AbbVie ends work on cancer drug Rova-T after failures

AbbVie Inc. said it would stop all research on its experimental cancer treatment Rova-T, a drug it bought in its $5.8 billion 2016 takeover of Stemcentrx Inc.

The decision to stop work on Rova-T marks the formal end to a costly project that resulted in a $4 billion writedown by the pharmaceutical company in January.

On Thursday, AbbVie said in a statement that the drug wasn't effective in a study of lung cancer patients and that it would halt all future development. Last year, the company said it wouldn't seek accelerated approval for the drug, suggesting its results were not as promising as once hoped.

AbbVie shares rose 0.7% to $66.52 at 9:39 a.m. in New York, in line with gains in the rest of the stock market. Investors had already largely written off expectations for the drug.

AbbVie's $5.8 billion deal for Stemcentrx was an attempt to diversify its revenue away from Humira, the blockbuster drug that makes up more than half its sales, with a new, experimental therapy. Instead, AbbVie is now going ahead with its $63 billion takeover of Allergan Plc, which is less of a bet on risky R&D and more about lucrative existing products like the anti-wrinkle drug Botox.