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Lundbeck shares in freefall after disappointing drug trial

Maneesh Venkatesh
October 29th, 2018


This article is more than 6 years old.

New schizophrenia treatment no better than current offerings as stock plummets by 30 percent

Pills easy to source, say youngsters (photo: Pixabay)

Shares in Lundbeck plunged by 30 percent at the end of last week after the Danish pharma giant reported disappointing results for its new schizophrenia treatment.

The share-price fall followed the announcement late on Thursday, dropping from 398.9 to 283.1 kroner, before a slight rally on Friday saw it finish the week on 294.7.

High hopes turn to dust
Lundbeck had high hopes that its new drug, provisionally named Lu AF35700, would provide a treatment for schizophrenia superior to its current offerings Risperidone or Olanzapine, and analysts were predicting blockbuster sales.

But the disappointing results of the third phase tests – the final hurdle before a drug can seek health authority approval – have derailed those dreams, leaving Lundbeck facing an estimated loss of 4 billion dollars.

Hopeful about Parkinson’s treatment
The company will now pin its hopes on Foliglurax, a new treatment for Parkinson’s disease in its second phase of testing, along with an Alzheimer’s treatment currently in phase one.

Earlier this month, fellow Danish pharma goliath Novo Nordisk emerged as a rival when it announced its intention to produce treatments for neurodegenerative diseases such as Parkinson’s and Alzheimer’s – the first time it has ever encroached on Lundbeck’s territory.

READ MORE: Novo looks towards neurodegenerative diseases to increase future profitability


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A survey carried out by Megafon for TV2 has found that 71 percent of parents have handed over children to daycare in spite of them being sick.

Moreover, 21 percent of those surveyed admitted to medicating their kids with paracetamol, such as Panodil, before sending them to school.

The FOLA parents’ organisation is shocked by the findings.

“I think it is absolutely crazy. It simply cannot be that a child goes to school sick and plays with lots of other children. Then we are faced with the fact that they will infect the whole institution,” said FOLA chair Signe Nielsen.

Pill pushers
At the Børnehuset daycare institution in Silkeborg a meeting was called where parents were implored not to bring their sick children to school.

At Børnehuset there are fears that parents prefer to pack their kids off with a pill without informing teachers.

“We occasionally have children who that they have had a pill for breakfast,” said headteacher Susanne Bødker. “You might think that it is a Panodil more than a vitamin pill, if it is a child who has just been sick, for example.”

Parents sick and tired
Parents, when confronted, often cite pressure at work as a reason for not being able to stay at home with their children.

Many declare that they simply cannot take another day off, as they are afraid of being fired.

Allan Randrup Thomsen, a professor of virology at KU, has heavily criticised the parents’ actions, describing the current situation as a “vicious circle”.

“It promotes the spread of viruses, and it adds momentum to a cycle where parents are pressured by high levels of sick-leave. If they then choose to send the children to daycare while they are still recovering, they keep the epidemic going in daycares, and this in turn puts a greater burden on the parents.”