J&J scraps depression testing for potential blockbuster drug

Johnson & Johnson is terminating some research for an experimental drug that the company previously predicted could be a multibillion-dollar product.

In a statement released Thursday afternoon, J&J said it will stop developing the drug, called aticaprant, as an add-on therapy for patients with major depressive disorder. Over the past few years, a series of large, late-stage clinical trials tested aticaprant in adults who have hard-to-treat MDD and moderate-to-severe cases of a defining symptom of the disorder, anhedonia, which presents as a loss of interest or an inability to experience joy.

While the drug continues to look safe and well-tolerated, the program has shown “insufficient efficacy in the target patient population,” according to J&J. Aticaprant may still have potential, however, so the company plans to “explore future development opportunities” in other “areas of high unmet need.”

J&J says it remains committed to the neuroscience space, as evidenced by its recent agreement to acquire Intra-Cellular Therapies — maker of the mind-stabilizing therapy Caplyta — for nearly $15 billion. The pharmaceutical giant noted, too, that it still expects its medicines division to hit a compound annual growth rate of 5% to 7%. That division recorded $57 billion in sales last year, an increase of 4% from 2023.

For now, though, prospects appear dimmer for one of J&J’s more closely followed projects. David Risinger, an analyst at Leerink Partners, wrote in a note to clients that Wall Street has been penciling about $1 billion in annual sales from aticaprant by 2032.

J&J had outlined an even rosier forecast in late 2023, when it projected peak annual sales could fall anywhere between $1 billion and $5 billion.

The setback will almost certainly dent those estimates, and could make J&J’s goal of becoming the top neuroscience company by 2030 more difficult. Yet for a behemoth like J&J, aticaprant was just one of nearly 20 novel drug programs across its pipeline that it had said could eventually reach blockbuster status.

Perhaps that’s why J&J’s stock was little affected Friday, rising more than 1%. Meanwhile, shares of Neumora Therapeutics, a biotechnology startup working on a similar drug, were down close to 5%.

Neumora debuted in late 2021, armed with half a billion dollars in funding from some of the industry’s most prolific venture capital firms, including Arch Venture Partners and Polaris Partners, as well as Amgen. The biotech continued to raise money and, in the summer of 2023, raked in another $250 million by going public.

Neumora’s stock took a sharp dive early this year, though, when a late-stage study found its drug navacaprant to be no better than a placebo at treating moderate-to-severe MDD. J&J’s and Neumora’s are both designed to block “kappa opioid receptors,” a type of protein that regulates various parts of the nervous system. Research indicates these proteins affect mood, stress and pain perception.

Brian Abrahams, an analyst at RBC Capital Markets, suspects the discontinued J&J trials could erode “any residual hope” these drugs might be useful in depression. It may also “cast further doubt” on the likelihood of success for Neumora’s ongoing studies.

Stifel analyst Paul Matteis echoed those sentiments, writing in a note to clients that the news is a “big blow” to the thesis around kappa opioid receptor drugs. Matteis downgraded his rating on Neumora stock to “Hold,” arguing the stock “becomes much harder to defend” following J&J’s decision.

Neumora shares are down more than 90% since the company’s initial public offering, and, as of late Friday morning, they traded at roughly $1.45 apiece.

AbbVie is also developing a kappa opioid antagonist it acquired via its Cerevel Therapeutics acquisition last year. According to the company’s pipeline chart, the drug is in Phase 1 testing.

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