Alkermes shares tumble as sleep disorder drug shows limited advantage over rival

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By Kamal Choudhury

(Reuters) -Alkermes shares tumbled more than 10% on Wednesday after its experimental sleep disorder drug showed weaker-than-expected results, lowering its competitive edge against a rival candidate from Centessa.

The drug candidate, alixorexton, met both main goals of an eight-week mid-stage study in 93 patients with narcolepsy type 2, a condition that causes excessive daytime sleepiness and disrupts the brain’s ability to regulate sleep and wake cycles.

The treatment was designed to target orexin 2 receptor, which plays a key role in staying awake.

The data showed less improvement in wakefulness, the ability to stay awake, when measured using a common scale, compared to Centessa trials for patients with the same condition, said UBS analyst So Youn Shim.

U.S.-listed shares of Centessa jumped more than 17% in the day.

While the 14 mg and 18 mg doses of alixorexton improved patients’ ability to remain awake when given once daily during an eight-hour test period, the effect showed “more variability” at six and eight hours after dosing, suggesting the drug’s effectiveness appeared to fade later in the day.

Alixorexton “disappoints” on measures of staying awake in the tested patient population, Piper Sandler analysts said, adding that Centessa’s ORX750 at 4 milligrams showed strong early results at week two.

Alkermes now plans to test a split dosing regime in late-stage trial, Chief Medical Officer Craig Hopkinson said. The study would also test once-daily administration.

UBS’ So Youn Shim said twice-daily dosing would remove the drug’s “potential competitive advantage” over rivals such as Takeda’s oveporexton.

Piper Sandler analysts also said pushing the dose higher in the upcoming late-stage study “is somewhat of a risky strategy for Alkermes, given that it would essentially be ‘flying blind’ in the phase-3 study with doses that haven’t yet been tested in phase 2”.

Alkermes said it plans to start a late-stage trial program in the first quarter of 2026.

(Reporting by Kamal Choudhury in Bengaluru; Editing by Anil D’Silva, Sahal Muhammed and Shilpi Majumdar)