Investors felt the weight of disappointment as shares of Fulcrum Therapeutics, Inc. (NASDAQ: FULC) plummeted by 61.1% on September 12th. The catalyst behind this dramatic fall was the revelation of less-than-promising top-line data from the phase III REACH study. This trial assessed the feasibility of losmapimod, a prospective treatment for facioscapulohumeral muscular dystrophy (FSHD), a rare and crippling condition with no approved remedies to date.
The trial fell short of its primary objective, as losmapimod failed to exhibit a significant change in relative surface area (RSA) compared to placebo at week 48. The secondary endpoints also fell short of achieving nominal statistical significance, amplifying the disappointment among investors.
Year to date, Fulcrum’s stock has dwindled by a staggering 49%, starkly contrasting with the industry’s modest decline of 0.8%.
Image Source: Zacks Investment Research
Evaluation of Data from FULC’s REACH Study
The data extracted from the REACH study indicated minuscule improvements with losmapimod treatment in comparison to the placebo group. Although patients exhibited slight enhancements in certain areas, the results were far from substantial. Subsequently, Fulcrum decided to discontinue any further development of losmapimod in FSHD.
Future Prospects for FULC in Pipeline Development
Fulcrum is redirecting its focus towards another compound, pociredir, currently in an early-stage trial for sickle cell disease (SCD), a hereditary blood disorder. The phase Ib PIONEER study has been evaluating pociredir’s efficacy in SCD treatment, with the FDA already granting it Fast Track and Orphan Drug designations.
The significant unmet medical need within SCD presents Fulcrum with a potential avenue for growth. The company’s cash reserves of $273.8 million as of June 30, 2024, are earmarked for advancing pociredir’s development for SCD and other pipeline activities.
Zacks Rank & Other Biotech Stocks to Consider
Fulcrum currently boasts a Zacks Rank #1 (Strong Buy), signifying positive market sentiment towards the stock. Other top-ranking stocks in the biotech sector include Illumina, Inc. (NASDAQ: ILMN) and Krystal Biotech, Inc. (NASDAQ: KRYS), both holding a Zacks Rank #1 at present.
Recent estimations for Illumina’s and Krystal Biotech’s earnings indicate promising prospects for the future, although their stock performances have varied in the current year.
