Mereo BioPharma Shares Plunge 87.5% After Phase 3 Study Fails to Meet Primary Endpoints
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Dec 29 2025
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Source: Benzinga
- Study Failure: Mereo BioPharma's Phase 3 ORBIT and COSMIC studies failed to achieve statistical significance in reducing clinical fracture rates, causing shares to plummet 87.5% to $0.29 in pre-market trading, severely undermining market confidence in the company.
- Partner Impact: Ultragenyx Pharmaceutical, a partner of Mereo, also saw its shares drop 43.7% to $19.26, reflecting investor pessimism about the drug's prospects, which may affect future collaborations and funding for research and development.
- Market Reaction: Other related stocks, such as SPAC III Acquisition Corp and Sellas Life Sciences, experienced declines of 11.7% and 7.6%, respectively, indicating a broader erosion of confidence in the biotech sector among investors.
- Investor Sentiment: The failure of Mereo's studies has dampened investor sentiment in the biotech field, potentially leading to capital outflows and stricter financing conditions that could hinder the growth of other companies in the industry.
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Analyst Views on MREO
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
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
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.
Mereo BioPharma Under Investigation for Securities Law Compliance
- Legal Investigation Initiated: Holzer & Holzer, LLC is investigating whether Mereo BioPharma Group plc complied with federal securities laws, particularly after the December 29, 2025 announcement of Phase 3 Orbit and Cosmic study results, which revealed that neither study achieved statistical significance, leading to a stock price drop.
- Poor Clinical Trial Results: Mereo's studies failed to demonstrate that setrusumab (UX143) was superior to placebo or bisphosphonates in reducing clinical fracture rates, raising doubts about the product's efficacy in treating Osteogenesis Imperfecta, which could adversely affect future market performance.
- Investor Loss Warning: Following the disappointing study results, Mereo's stock price declined, prompting Holzer & Holzer to encourage investors who purchased shares during this period and suffered losses to reach out to discuss their legal rights, highlighting a commitment to investor protection.
- Law Firm Background: Since its founding in 2000, Holzer & Holzer has focused on vigorous representation of shareholders and investors, recovering hundreds of millions of dollars for defrauded shareholders, underscoring its expertise and influence in the securities litigation field.
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Mereo BioPharma Updates on Rare Disease Programs, Extends Cash Runway to 2027
- Drug Development Progress: Mereo BioPharma's setrusumab (UX-143) for Osteogenesis Imperfecta did not meet its primary endpoint in December 2025 trials, yet achieved statistical significance in improving bone mineral density, indicating potential therapeutic value that may influence future regulatory approvals.
- Cash Flow Outlook: Following recent clinical data, Mereo expects its cash runway to extend into mid-2027, with CEO Denise Scots-Knight noting ongoing assessments of overall Phase 3 trial data to determine next steps, ensuring continued investment in R&D.
- New Drug Clinical Plans: Mereo's alvelestat (MPH-966) is set to initiate a global Phase 3 trial enrolling approximately 220 patients for Alpha-1 Antitrypsin Deficiency, expected to support regulatory submissions in both the U.S. and Europe, demonstrating the company's strategic focus in the rare disease sector.
- Partnership Development: Mereo has partnered with Ashibio, Inc. for the development of vantictumab (OMP18R5), which will fully fund the global program for Autosomal Dominant Osteopetrosis Type 2, with a Phase 2 study planned for the second half of 2026, further expanding the company's product pipeline.
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