Ozempic's early success in kidney disease trial hits dialysis stocks
By Mariam Sunny
(Reuters) -Shares of dialysis service providers DaVita (NYSE:DVA) and Fresenius Medical Care (NYSE:FMS) fell sharply on Wednesday after Novo Nordisk (NYSE:NVO)'s Ozempic showed early signs of success in delaying the progression of kidney disease in diabetes patients.
The Danish drugmaker said late on Tuesday it will stop the trial almost a year ahead of schedule, based on interim results from the study, which met the pre-set criteria for efficacy according to an independent data monitoring committee.
The dialysis market has for decades been sustained by high rates of obesity and diabetes, which contribute to kidney damage, but GLP-1 drugs such as Novo's Ozempic and Wegovy have been seen to dramatically improve both conditions.
Novo's announcement is the latest sign of disruption caused by the success of GLP-1 drugs, which have hit the shares of food companies, providers of bariatric surgery and companies that make glucose-monitoring devices.
The new data is the «latest piece of positive news» for GLP-1 drugs and continues its clinical advancements, said Wells Fargo analyst Mohit Bansal, adding that success in kidney-disease patients could unlock a population of as many as 5 million patients for such medication.
Citi analysts said GLP-1 drugs could shrink the size of the eligible dialysis population over time.
U.S.-listed shares of Fresenius fell 15.5%, to $17.7, and Davita fell about 16%, to $76.8, in premarket hours. Shares of U.S.-based Baxter International (NYSE:BAX), which makes products used by dialysis therapy providers, also fell 9.5% to $33.8 premarket.
Frankfurt-listed shares of Fresenius fell 7.7%, to 25.52 euros ($27.09).
Davita's price-to-earnings ratio for the next 12 months, a common
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