A GSK Cancer Drug Is Making a Comeback. It’s So-So News for the Stock.

GSK’s American depositary receipts jumped in response to an FDA decision on Thursday, only to fall back on Friday. Above, the company’s headquarters in London. (Justin Tallis / AFP / Getty Images)

Key Points

• The FDA approved Blenrep for multiple myeloma in combination with bortezomib and dexamethasone, but only for later-stage patients.
• GSK’s stock initially rose 2.9% on approval news but fell 5% the next day as investors assessed the limited scope of the approval.
• Experts pointed to high rates of eye problems among patients using Blenrep during a July advisory committee meeting.

The Food and Drug Administration’s approval of the cancer drug Blenrep late Thursday offered some vindication for GSK, which has been battling for years to get the treatment back on the market, but the details weren’t quite good enough to satisfy investors.

GSK American depositary receipts jumped in the final moments of trading on Thursday, when news of the approval crossed the wire. It closed up 2.9% at $45.54.

As investors examined the company update, however, sentiment reversed. On Friday, the stock was down 5% to $43.25, more than giving up the gain.

The FDA approved Blenrep as a treatment for multiple myeloma, a form of blood cancer, when administered in conjunction with two other medicines, called bortezomib and dexamethasone. But it didn’t approve a separate combination GSK had proposed. The company had wanted Blenrep to be given in conjunction with the drugs pomalidomide and dexamethasone as well

What is more, while GSK had asked the FDA to approve the Blenrep combination for patients with multiple myeloma who have already received at least one line of earlier treatment, the FDA approval only covers later-stage patients who had received at least two lines of treatment.

That all adds up to a mixed conclusion to the Blenrep saga, which has dogged GSK for the past three years.

The FDA initially approved Blenrep as a stand-alone treatment for multiple myeloma patients in 2020. But in 2022, it said it would withdraw the drug after it failed a required confirmatory trial.

GSK tried again with the combination regimens, and two separate Phase 3 trials yielded promising results in 2024. In the trial that tested Blenrep with bortezomib and dexamethasone, called DREAMM-7, GSK saw a 51% reduction in the risk of death.

There was, however, significant skepticism among experts about the new Blenrep combinations. At a meeting of an outside advisory committee of cancer experts convened by the FDA in July, FDA staff and outside experts pointed to high rates of eye problems in patients on Blenrep. They also raised concern that the combination trials hadn’t tested enough doses.

At the end of the July meeting, when asked whether the “overall risk-benefit” of the Blenrep combination with bortezomib and dexamethasone was “favorable,” the outside experts voted 3 to 5 against. They were even less convinced by the other combination, which the FDA didn’t ultimately approve. Only one expert voted in favor.

“This was a challenging decision because the efficacy data were strong, but the toxicity data were also very strong,” Dr. Neil Vasan, a medical oncologist at NYU Langone, said at the conclusion of the meeting. He voted against both combinations.

GSK’s ADRs fell 4.7% to $36.47 on the day of the vote as hope for the approval of either of the combinations dropped. While the FDA isn’t bound by the votes of its expert committees, it often follows their guidance.

An FDA decision on the two combinations had been due on July 23, a week after the committee meeting. When July 23 arrived, however, GSK said that it had extended the deadline until October.

“We remain very confident that Blenrep can bring significant benefit to patients with multiple myeloma in the U.S. and are in constructive discussions with the agency,” the company’s CEO, Emma Walmsley, said on an investor call in late July.

The approval Thursday avoids a worst-case scenario for GSK. But it isn’t the victory the company had likely hoped for.

“We believe Blenrep can redefine treatment for patients with multiple myeloma in all parts of the world, and we are accelerating its development in earlier lines of therapy to support its use across all stages of this difficult-to-treat cancer,” the company’s chief scientific officer, Tony Wood, said in a statement.

Analysts see the drug eventually hitting blockbuster status. The consensus forecast among those tracked by FactSet is that sales will climb to $2.1 billion by 2030.

GSK’s ADRs are up almost 28% this year. It has gotten a lift in recent weeks from the tariff and drug-price deals that Pfizer and AstraZeneca struck with the Trump administration, which appear to have eased political pressure across the pharma sector.

The company’s CEO, Emma Walmsley, also announced her departure in late September. She will be succeeded at the end of the year by Luke Miels, the company’s chief commercial officer.

Write to Josh Nathan-Kazis at josh.nathan-kazis@barrons.com