Bristol Myers Squibb's Cobenfy Faces Setback in Schizophrenia Trial

Bristol Myers Squibb's (BMS) ambitious plans for its novel schizophrenia drug Cobenfy have hit a significant roadblock, as the medication failed to demonstrate superior efficacy in a crucial phase 3 trial. This setback, coupled with recent disappointing results for another key product, raises concerns about the pharmaceutical giant's strategy to navigate upcoming patent expirations.

Cobenfy Falls Short in Adjunctive Treatment Trial

Cobenfy, a centerpiece of BMS's $14 billion acquisition of Karuna Therapeutics, failed to show statistically significant improvement as an adjunctive treatment for schizophrenia in the phase 3 Arise trial. The study aimed to evaluate Cobenfy's efficacy when used alongside atypical antipsychotics in patients with inadequately controlled schizophrenia.

While the trial showed a numerical improvement, with Cobenfy demonstrating a 2-point reduction compared to placebo on the Positive and Negative Syndrome Scale (PANSS) total score at week 6, this difference did not reach statistical significance. The PANSS is a clinician-administered tool used to assess schizophrenia symptoms.

This outcome has led analysts to significantly reduce their sales projections for Cobenfy. Leerink Partners, for instance, has slashed their 2030 sales estimate from $5.8 billion to $2.6 billion, citing concerns about the drug's modest efficacy and its twice-daily dosing regimen.

Potential Silver Linings and Future Prospects

Despite the setback, some analysts remain cautiously optimistic about Cobenfy's future. Citi analysts, while lowering their 2030 sales estimate by $600 million to $2.8 billion, suggest that Cobenfy could still achieve over $5 billion in annual sales with additional indications.

One such promising area is Alzheimer's disease psychosis, where Jefferies analyst Akash Tewari sees potential for Cobenfy to reach $4 billion in peak sales. BMS is currently conducting phase 3 trials (Adept-1, -2, and -4) in this indication, with results expected later this year and in 2026.

Interestingly, the Arise trial revealed that Cobenfy appeared to have better efficacy in patients not taking background risperidone, showing a nominal 3.4-point reduction in PANSS versus placebo in this subgroup. This finding could potentially inform future clinical strategies and off-label use.

Broader Implications for Bristol Myers Squibb

The Cobenfy setback is not an isolated incident for BMS. Just days earlier, the company announced that its heart medication Camzyos had failed in a phase 3 trial for non-obstructive hypertrophic cardiomyopathy (HCM). Camzyos, acquired through BMS's $13.1 billion purchase of MyoKardia in 2020, was expected to be a significant growth driver for the company.

These recent trial failures have put pressure on BMS's strategy to offset the impending loss of patent protection for several key products, including Revlimid, Pomalyst, Opdivo, and the Pfizer-partnered Eliquis. The company had been counting on newer drugs like Cobenfy and Camzyos to help maintain its market position during this transitional period.

As Bristol Myers Squibb navigates these challenges, the pharmaceutical industry will be closely watching how the company adjusts its pipeline strategy and whether it can successfully bring new, effective treatments to market in the face of these recent setbacks.