Shares in GSK fell more than 6% on Thursday after the U.S. Centers for Disease Control and Prevention (CDC) narrowed its usage recommendation for respiratory syncytial virus (RSV) vaccines.
The CDC now advises the vaccine for individuals aged 60 to 74 who are at increased risk of severe RSV due to medical conditions but refrained from recommending it for those under 60.
This decision is a setback for GSK, which manufactures the Arexvy RSV vaccine and had high hopes for it to become a blockbuster product. The company is facing patent expiries and declining revenues from its current top-selling drugs by the end of this decade.
GSK stock recovered some of the losses and was down 4.4% at the time of writing.
Commenting on the development, analysts at UBS said they believe the CDC’s decision hurts GSK the most “as they were the only company looking for a 50-59 endorsement.” However, they added the whole market size could be impacted by a clear move not to explore revaccination options until there is further evidence of the benefit of revaccination.
Despite the negative read to GSK, the investment bank reiterated its Buy rating on the stock due to “higher than consensus sales driven by Shingrix and Cabenuva in 2028, and higher EPS on improved gross margins from mix towards more specialty drugs vs. lower priced primary care products.”