Gossamer Bio's stock collapses after Phase 3 trial failure for PAH drug

Gossamer Bio is facing major setbacks after its key drug candidate, seralutinib, failed a critical Phase 3 trial. The company's stock has dropped sharply, losing around 86% of its value since January. With a market capitalisation now below $100 million, investors are watching closely ahead of its next quarterly report on May 12.

The troubles began when seralutinib, an inhaled inhibitor targeting PDGFR, CSF1R, and c-KIT, missed its primary goal in the PROCERA Phase 3 study for treating pulmonary arterial hypertension (PAH). Earlier Phase 1 and 2 trials had shown promise, but this failure now threatens the entire development programme. The full results from PROCERA are not due until February 2026, though a new Phase 3 study, SERENADA, has already started.

Analysts have reacted with caution. Cantor Fitzgerald downgraded Gossamer Bio's stock from 'Overweight' to 'Neutral' after the trial's disappointing outcome. The company's shares, already in steep decline, last traded at about $0.42. Opinions among analysts remain split, with two advising investors to sell while four still recommend buying. Their price targets vary widely, from a low of $0.30 to a high of $15.00, averaging $5.43.

In response, Gossamer Bio has scheduled a 'Type C' meeting with the U.S. Food and Drug Administration (FDA) in June. The aim is to explore potential regulatory pathways despite the trial's failure. Concrete feedback from the FDA is expected by July.

The company's future now hinges on the FDA's response and the progress of its remaining studies. With its stock in penny-stock territory and analyst views divided, Gossamer Bio's next moves will be critical. The upcoming quarterly results on May 12 may provide further clarity on its financial and operational standing.