FRANKFURT (dpa-AFX) - Merck KGaA's discontinuation of two studies for the use of the promising drug Xevinapant spooked investors on the stock exchange on Tuesday morning. In early trading on Xetra, the shares of the pharmaceutical and chemical company slumped by almost 10 percent to just under 151 euros. They slipped to their lowest level since the beginning of May. They were the biggest loser in the leading Dax index, which fell by 1.3 percent.

The Darmstadt-based company took the failure of the two advanced studies as an opportunity to discontinue the entire research program with the cancer drug Xevinapant. One study involved a combination of the drug with chemotherapy in patients with head and neck tumors. According to Merck, the study is not expected to achieve its primary objective. In addition, a trial for a combination of xevinapant with radiotherapy will be terminated.

Analyst Brian Balchin from investment firm Jefferies had assigned a probability of only five percent to the discontinuation of the trials for use in locally advanced head and neck tumors. The expert was already anticipating a mid to high single-digit percentage discount on the Merck share price before the start of trading.

In principle, investors could now question the company's ability in terms of research and development, according to Balchin. Not least in view of the recent disappointing trial data for the drug Evobrutinib against multiple sclerosis.

This was also the view of one share trader: "The debate on how to revive research and development in Merck's pharmaceutical division is now likely to gather pace". This would weigh heavily on the share price. On the other hand, the negative news is now known and priced into the share price.

"This means that one of the beacons of hope is suffering a severe setback not only for all patients, but also for the company," commented capital market strategist Jürgen Molnar from RoboMarkets on the end of the studies. The share price has now reached support at the round mark of 150 euros. Should the price fall below this level, investors are likely to focus on the mid-April low of EUR 142.70./bek/ajx/tih