From Morningstar: 2024-06-03 07:16:00

Shares in GSK took a nearly 10% hit after a ruling brought up legal concerns over cancer risk tied to heartburn drug Zantac. GSK’s stock opened at £15.98, well below Morningstar’s fair value estimate of £22.20p. They face around 70,000 claims linked to carcinogen NDMA in Zantac.

A Delaware judge’s ruling allows 70,000 litigants to proceed with cases against GSK over Zantac’s alleged cancer risk. The FDA pulled the drug due to low levels of a potential carcinogen in 2020. GSK’s shares opened at £15.98, sharply lower than Morningstar’s fair value.

If found liable, GSK may face heavy compensation payouts. Other drug makers like Sanofi could also be impacted. GSK plans to appeal the ruling, maintaining that scientific evidence does not support cancer risks from Zantac. Morningstar analysts are closely monitoring the situation.



Read more at Morningstar: GSK Shares Dive as Litigation Woes Deepen