Genmab (GMAB) Shares Plunge 0.74% to 2025 Low as Merus Acquisition Spark Market Skepticism

Genmab (GMAB) shares fell 0.74% on Monday, marking their lowest level since October 2025. Intraday data showed a steeper 1.91% decline, signaling renewed pressure on the Danish biotech firm amid investor reassessment of its strategic and financial outlook.

The recent volatility follows Genmab’s $8 billion acquisition of Merus, a Dutch biotech company, in early October 2023. The deal, which added Merus’ bispecific antibody platform and lead candidate petosemtamab to Genmab’s portfolio, initially fueled optimism. Petosemtamab, a therapy for B-cell malignancies, is nearing regulatory approval and has drawn analyst attention for its potential to generate near-term revenue. However, the stock’s recent pullback suggests market skepticism about the long-term value of the acquisition and the drug’s commercial viability.

Analyst sentiment played a pivotal role in shaping Genmab’s trajectory. Raghuram Selvaraju and Asthika Goonewardene, two prominent biotech analysts, raised price targets for Genmab in October 2023, citing petosemtamab’s clinical progress and the Merus deal’s strategic fit. These upgrades initially drove a 4% surge in the stock price. Yet, the subsequent decline indicates that investors are recalibrating expectations, particularly as top-line data from petosemtamab trials remain pending until 2024. Analysts had previously highlighted the drug’s potential for rapid commercialization, but delays or mixed results could amplify risk perceptions.

Valuation metrics also contributed to the stock’s mixed performance. While discounted cash flow models and price-to-earnings ratios historically suggested undervaluation, recent market conditions have shifted. Genmab’s trailing P/E of 14.3x, below the biotech sector average, initially attracted investors. However, broader economic uncertainties and sector-specific risks—such as regulatory hurdles and competitive pressures—have tempered enthusiasm. The acquisition’s $8 billion price tag, while strategic, has raised questions about Genmab’s balance sheet flexibility and long-term return on investment.

Market dynamics in the biotech sector further influenced Genmab’s stock. A broader reassessment of growth stocks, driven by shifting interest rate expectations and risk appetite, has led to sector-wide volatility. Genmab’s focus on oncology innovation, particularly bispecific antibodies, aligns with industry trends, but its recent underperformance highlights the sector’s sensitivity to near-term data and macroeconomic factors. The company’s ability to execute its M&A strategy and deliver on petosemtamab’s promise will likely determine its trajectory in the coming months.

Despite the recent downturn, Genmab remains positioned to benefit from key milestones. Petosemtamab’s potential approval and commercialization could redefine its revenue profile, while the Merus acquisition strengthens its pipeline. However, the market’s current reaction underscores the need for concrete data and clear differentiation in a competitive oncology landscape. As investors await further developments, Genmab’s stock may continue to experience swings based on regulatory updates, analyst commentary, and broader market sentiment.