Proactive Investors - What was supposed to be a stellar day for GSK PLC (LON:GSK) at the annual American Society of Clinical Oncology turned into quite the opposite.
News of an adverse ruling in a Delaware court affecting long-running litigation over Zantac, the heartburn tablet linked cancer, overshadowed what was a very bullish read-out from a trial of its Blenrep drug in people suffering multiple myeloma.
Its latest DREAMM clinical trials received little or no traction after Judge Medinilla decided to wave through 75,000 Zantac cases, which knocked 9.5% off the share price.
So, to paraphrase the investment bank research report writers, the 'DREAMM became a nightmare'.
"Settlement [of the legal case] is now unlikely at least until after the outcome from GSK's intended appeal to the Delaware Supreme Court, in our view," said US broker Jefferies in a note. It estimates the impact of the class action to be $2-3.5 billion.
Citi in a note reckons a Zantac settlement will cost the UK drugmaker around $3 billion. The American bank urged recipients of its research to take advantage of any "material weakness" in the stock price given how well the latest DREAMM clinical studies of Blenrep went.
Citi's price target is £21 a share as is Jefferies'. The stock was up 1% at £16.13.