Novartis shares are heading for their best single-day gain since 2023 after positive clinical data for a potential blockbuster drug offset the pause of eight rap-cel autoimmune trials following three patient deaths. The stock's resilience reflects a diversified pipeline and strong first-half 2026 earnings.
Novartis shares head for best day since 2023 as blockbuster drug data offsets rap-cel trial pause tied to three deaths.
"Emergence of adverse events in NVS and BMY autoimmune trials highlight risks but could reduce competition in a crowded CAR-T space," William Blair analysts wrote in a note to investors.
Novartis paused screening, randomization and dosing across eight early- and mid-stage studies of rapcabtagene autoleucel (rap-cel) on Aug. 24 after three patients died from immune effector cell-associated hemophagocytic syndrome (IEC-HS), a severe inflammatory complication. The affected program spans systemic lupus erythematosus, systemic sclerosis, myositis, rheumatoid arthritis, Sjögren's disease, generalized myasthenia gravis and multiple sclerosis. Cancer studies of rap-cel remain unaffected.
The ADR last closed at $152.46, while the Swiss line traded at 124.14 CHF on Aug. 31 after an intraday gain of 0.3 percent. A one-year Novartis position would have been worth 12,232.11 CHF on Aug. 28, reflecting double-digit appreciation plus dividends. The stock now trades near the upper end of its 12-month range.
Bristol Myers Squibb has also voluntarily frozen some studies of its CAR-T candidate zolacabtagene autoleucel (zola-cel) after observing "transient and reversible inflammatory events," a spokesperson confirmed. The BMS events were not fatal. William Blair noted that rapid manufacturing, a feature of both rap-cel and zola-cel, could be driving increased cell expansion and the reported toxicities.
Novartis reported higher first-half 2026 revenue and net income versus the prior year, driven by growth in cardiovascular, oncology and immunology products. Entresto, the heart failure drug, delivered high-single-digit to low-double-digit sales growth, helping offset generic erosion. Management reiterated full-year 2026 guidance for continued sales and core operating income growth.
At the EULAR 2026 meeting, Novartis presented early data from its AUTOGRAPH studies showing clinically meaningful improvements and rapid, deep B-cell depletion in patients with severe, treatment-refractory idiopathic inflammatory myopathies and diffuse cutaneous systemic sclerosis. The company described the safety profile as manageable at the time.
The company is now reviewing safety data with independent data committees and regulators to identify risk factors for IEC-HS, including patient populations, lymphodepletion regimens and CAR-T exposure. The outcome will determine whether the program resumes with modified protocols or faces broader limitations.
The positive blockbuster data points to continued pipeline-driven growth, providing a buffer against the autoimmune setback. Investors will watch for updated guidance on rap-cel's regulatory path and the next clinical readout for the blockbuster candidate.
This article is for informational purposes only and does not constitute investment advice.
