PureTech Health surges on positive Karuna Therapeutics drug trial

PureTech Health surged on Tuesday after US biopharmaceutical company Karuna Therapeutics - in which it owns a 32% stake - said a day earlier that a phase 2 trial of its schizophrenia treatment met its primary endpoint.

Karuna shares rocketed 433% on Monday after it said that its KarXT treatment for acute psychosis in schizophrenia patients demonstrated a "statistically significant and clinically meaningful" reduction in total positive and negative syndrome scale (PANSS) score compared with a placebo. The treatment was also well tolerated and Karuna said it was aiming to launch a phase 3 trial by the end of next year.

Broker Liberum said the data was "impressive with an 11.6 point improvement in PANSS score comfortably ahead of expectations". This compares with currently-approved drugs which show 9-10 point improvements.

"Importantly, the drug was remarkably well tolerated with similar discontinuation rates between placebo and drug arms. PureTech's 32% stake in Karuna is worth $130m based on the Karuna Friday closing price, but will likely be up significantly on this news."

Liberum noted that schizophrenia is a difficult disease to treat and there's still need for better drugs. "KarXT looks to have delivered excellent efficacy," it said.

At 1215 GMT, PureTech shares were up 16.5% at 290p.