Mereo BioPharma Group PLC's stock price fell by 18.46%, crossing below the 5-day SMA, following a significant announcement regarding its clinical trials.
The decline is attributed to Mereo BioPharma's announcement on December 29, 2025, regarding two Phase 3 studies failing to achieve statistical significance on primary endpoints, leading to a staggering 87.64% drop in stock price. This failure has severely impacted market confidence in its bone metabolism treatment, setrusumab. Additionally, a legal investigation has been initiated, further increasing the company's legal risks and affecting investor sentiment.
The implications of these trial failures are profound, as they not only reflect the challenges faced by Mereo in clinical development but also highlight the market's heightened sensitivity to success rates in biopharmaceutical trials. Investors are likely to remain cautious as the company navigates these setbacks.
Wall Street analysts forecast MREO stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for MREO is 2.08 USD with a low forecast of 0.50 USD and a high forecast of 5.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
8 Analyst Rating
Wall Street analysts forecast MREO stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for MREO is 2.08 USD with a low forecast of 0.50 USD and a high forecast of 5.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
6 Buy
2 Hold
0 Sell
Strong Buy
Current: 0.449
Low
0.50
Averages
2.08
High
5.00
Current: 0.449
Low
0.50
Averages
2.08
High
5.00
Cantor Fitzgerald
Kristen Kluska
Overweight
downgrade
$6 -> $3
2025-12-29
Reason
Cantor Fitzgerald
Kristen Kluska
Price Target
$6 -> $3
AI Analysis
2025-12-29
downgrade
Overweight
Reason
Cantor Fitzgerald analyst Kristen Kluska lowered the firm's price target on Mereo BioPharma to $3 from $6 and keeps an Overweight rating on the shares after the company announced that neither of the Phase 3 Orbit and Cosmic studies for setrusumab in Osteogenesis Imperfecta achieved statistical significance against their primary endpoints.
LifeSci Capital
Outperform -> Market Perform
downgrade
2025-12-29
Reason
LifeSci Capital
Price Target
2025-12-29
downgrade
Outperform -> Market Perform
Reason
LifeSci Capital downgraded Mereo BioPharma to Market Perform from Outperform.
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BTIG
analyst
Buy
downgrade
$6 -> $1
2025-12-29
Reason
BTIG
analyst
Price Target
$6 -> $1
2025-12-29
downgrade
Buy
Reason
BTIG lowered the firm's price target on Mereo BioPharma to $1 from $6 and keeps a Buy rating on the shares after the company announced that neither of the Phase 3 Orbit and Cosmic studies for setrusumab in Osteogenesis Imperfecta achieved statistical significance against their primary endpoints. However, the bone mineral density improvements had strong statistical significance in both trials and could support a potential path to market, adds the analyst, who points out that the FDA endorsed BMD as a valid surrogate endpoint in osteoporosis ten days ago. Based on today's update, the firm is lowering its view of the probability of success for setrusumab in OI to 30% from 90% and "conservatively" removing alvelestat in AATD from its valuation on Mereo, the analyst tells investors.
Baird
Outperform -> NULL
downgrade
$8 -> $1
2025-12-29
Reason
Baird
Price Target
$8 -> $1
2025-12-29
downgrade
Outperform -> NULL
Reason
Baird lowered the firm's price target on Mereo BioPharma to $1 from $8 and keeps an Outperform rating on the shares after the company announced that neither the ORBIT nor COSMIC study of setrusumab produced a statistically-significant reduction in the key primary endpoint of annualized fracture rate. Given the negative top-line results, the firm is removing its "Fresh Pick" designation and reducing its view of the probability of success for setrusumab in Osteogenesis Imperfecta to 5%, the analyst tells investors.
About MREO
Mereo BioPharma Group plc is a biopharmaceutical company focused on the development of therapeutics for rare diseases. The Company has developed a portfolio of late-stage clinical product candidates, and its two rare disease product candidates are setrusumab for the treatment of osteogenesis imperfecta (OI) and alvelestat primarily for the treatment of severe alpha-1 antitrypsin deficiency-associated lung disease (AATD-LD). In addition to the rare disease programs, it has two oncology product candidates in clinical development, which include Etigilimab, an IgG1 monoclonal antibody which binds to the human T-cell immunoreceptor with Ig and ITIM domains (TIGIT) receptor on immune cells to improve the activation and effectiveness of T-cell and NK cell antitumor activity and Navicixizumab is a bispecific antibody that inhibits delta-like ligand 4 (DLL4) and vascular endothelial growth factor (VEGF). Navicixizumab is developed for the treatment of late-line ovarian cancer.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
