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Investing.com -- Genmab (CSE:GMAB) (NASDAQ:GMAB) announced on Monday, March 10, that Johnson&Johnson (NYSE:JNJ) has chosen not to proceed with the development of GEN3014 (HexaBody-CD38), a next-gen version of their megablockbuster cancer drug, Darzalex.
Genmab’s U.S.-listed shares closed 9% lower Monday and fell by an additional 3.6% in Tuesday’s premarket trade.
GEN3014, also known as HexaBody-CD38, is an investigational monoclonal antibody developed by Genmab that targets the CD38 protein on multiple myeloma cells, enhancing immune-mediated tumor cell destruction.
The company held an investor call to discuss the decision, during which it shared initial data from a head-to-head study comparing GEN3014 to Darzalex.
While the results suggested potentially deeper responses, they were not compelling enough for J&J or Genmab to pursue further development of GEN3014 for other indications.
The findings offered some validation of the HexaBody platform but fell short of justifying continued investment in the drug.
Following the post-announcement stock pullback, analysts at William Blair upgraded Genmab stock to an Outperform rating.
“While we had been cautious on the potential of GEN3014 to beat Darzalex in a head-to-head study, getting past the highly anticipated J&J decision and expected share pullback now allows investors to focus on the company’s pipeline and potential blockbusters including Epkinly, Rina-S, and acasunlimab,” analysts said.
“With a steady cadence of Phase III readouts beginning in 2026 and potential for nearly $6 billion in revenues in 2032, the first full year post-Darzalex royalties, we are upgrading shares of Genmab to Outperform.”
Separately, RBC Capital Markets analysts said J&J’s decision marks “the most likely outcome.”
With the GEN3014 now removed from the firm’s forecasts, RBC analysts made slight estimate changes in the mid-term and lowered its price target on Genmab shares to DKK 2,300 from DKK 2,400.
“Attention will likely now turn to potential phase 2 updates for acasunlimab and Rina-S later this year,” the analysts noted.
