Incyte INCY suffered a setback in its ongoing mid-stage study on MRGPRX2 (INCB000262) in chronic spontaneous urticaria (CSU).

Consequently, shares of Incyte were down 9% on Nov. 18 in after-market trading.

Shares of Incyte have risen 5.4% year to date against the industry’s 11.1% decline.

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INCY Pauses Enrollment in CSU Study

Incyte announced that it will pause enrollment in the ongoing phase II study of MRGPRX2 in CSU due to certain in vivo preclinical toxicology findings.

The data was also shared with the FDA. The company is now working closely with the FDA to determine the next steps.

Additionally, data from the phase II study evaluating MRGPRX4 in cholestatic pruritus does not support further development.

Meanwhile, enrollment in the other INCB000262 proof-of-concept studies is complete. Data from all studies will help support its future development and guide the potential growth of backup molecules.

INCY’s Heavy Dependence on Jakafi

Incyte’s lead drug, Jakafi, is a JAK1/JAK2 inhibitor approved for the treatment of polycythemia vera in adults who have had an inadequate response to or are intolerant of hydroxyurea; intermediate or high-risk myelofibrosis (MF), including primary MF, post-polycythemia vera MF and post-essential thrombocythemia MF in adults; steroid-refractory acute graft-versus-host disease (GVHD) in adult and pediatric patients 12 years and older; and chronic GVHD after failure of one or two lines of systemic therapy in adult and pediatric patients aged 12 years and older.

Sales in all indications continue to be strong and should maintain momentum.

While the uptake of recently approved drugs has been good and a potential approval of the additional drugs should diversify its portfolio, INCY is heavily dependent on Jakafi for its top-line growth.

Competition has increased for some of Jakafi’s approved indications. The FDA’s approval of GSK plc’s GSK Ojjaara for the treatment of intermediate or high-risk MF, including primary MF or secondary MF (post-polycythemia vera and post-essential thrombocythaemia), in adults with anemia, poses a concern.

Jakafi is also expected to lose patent protection in a few years. Hence, the successful development of new drugs is imperative to INCY.

INCY’s Zacks Rank & Stocks to Consider

Incyte currently carries a Zacks Rank #3 (Hold).

A couple of better-ranked stocks from the biotech sector are Immunocore Holdings plc IMCR and Castle Biosciences, Inc. CSTL, each carrying a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

In the past 60 days, estimates for Immunocore’s 2024 loss per share have narrowed from $1.79 to 94 cents. Loss per share estimates for 2025 have narrowed from $2.35 to $1.57 during the same time frame. Year to date, shares of IMCR have lost 54.6%.

IMCR’s earnings beat estimates in two of the trailing four quarters and missed the same in the other two, the average surprise being 25.57%.

In the past 60 days, estimates for Castle Biosciences’ 2024 loss per share have narrowed from 58 cents to 8 cents. Loss per share estimates for 2025 have narrowed from $2.13 to $1.88 during the same time frame. Year to date, shares of CSTL have surged 29.3%.

CSTL’s earnings beat estimates in each of the trailing four quarters, the average surprise being 172.72%.


 

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