Key Takeaways
- Argenx shares fell 11% after the company stopped its Phase 3 UNITY study of Vyvgart Hytrulo in Sjogren’s disease for futility.
- The sell-off looks overdone, since UNITY wasn’t due to read out until 2027 and Sjogren’s sales were unlikely to show up in the Street’s estimates through 2028.
- Analysts expect revenue to climb from $4.25 billion in 2025 to $9.33 billion in 2028, and the stock now trades at [about 24x] forward earnings.
- A Phase 3 myositis win in August and today’s positive Phase 2 celiac results for FB102 keep argenx’s push into new diseases going.
Argenx (ARGX) sank 11% on Thursday after the company pulled the plug on a late-stage trial of Vyvgart in Sjogren’s disease.
What happened
Before Thursday’s open, argenx said it will stop its Phase 3 UNITY study of Vyvgart Hytrulo, the under-the-skin version of efgartigimod, in adults with moderate-to-severe Sjogren’s. An independent data monitoring committee recommended stopping the study after an interim analysis concluded it can’t meet its primary endpoint. Safety was in line with the drug’s known profile.
Chief Medical Officer Luc Truyen didn’t sugarcoat it: “We are disappointed by this outcome, most of all for people living with Sjogren’s disease, who are still waiting for treatments that fundamentally change the course of their disease.”
That’s several billion dollars of market value gone on a single indication.
The near-term numbers barely move
Here’s the thing: UNITY wasn’t due to read out until 2027, so Sjogren’s sales were unlikely to be much of Wall Street’s estimates through 2028. Those estimates already call for steep growth from Vyvgart’s approved uses…
And nothing in today’s news makes me expect big cuts to those numbers.
What investors sold is the long tail: the idea that Vyvgart keeps expanding into one autoimmune disease after another. The worry is that UNITY followed an encouraging Phase 2 study of just 34 patients, which makes other small early wins look shakier.
Is the sell-off overdone?
I think so. After the drop, argenx trades at about 24x forward earnings.
That’s a reasonable price for a company analysts expect to more than double its revenue between 2025 and 2028.
And the expansion story is still alive. In August, Vyvgart Hytrulo met its primary endpoint in a Phase 3 myositis study, and William Blair projects peak sales of $3 billion in one subtype, IMNM, alone. Today’s Phase 2 results for FB102 also met their primary endpoint. argenx got the celiac drug when it bought Forte Biosciences in August, and Truyen called celiac a disease “where there are currently no approved therapies.” argenx plans to take FB102 into Phase 3.
Of course, a Phase 2 win is a long way from an approval, and the full UNITY analysis could still raise questions about other indications.
So what is argenx stock actually worth?
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Disclaimer:
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