A Phase 3 failure is always disappointing. However, I am bit annoyed by some of the news articles that have appeared in the press today crying "woe is me" and, specifically, "The bigger warning signs from CSL's heartburn", (The Australian), saying that management have some explaining to do.

Drug development is risky and, even at Stage 3, there is a 50-60% chance of failure. Which means that we EXPECT 5 or 6 out of every 10 drugs entering Phase 3 to be abandoned.

What distringuishes big pharma (like $CSL) from much more risky companies (like $NEU, $BOT - which I also hold), is that $CSL has a large pipeline across all development stages and addressing different therapy needs.

CSL112 in the success case might have been a blockbuster, and on a risked basis, today's SP correction is probably justified. However, I await any judgement on this until later in the year when we get an overall update on how the overall development portfolio is progressing.

And as @RobN rightly says, tomorrow is all about the 70-80% of the NPV of the company that is generating revenue today. It will be interesting to hear tomorrow what the progress is on revenue and margins.

Disc: Held