Keros Stock Hits Rock Bottom After Pulmonary Hypertension Trial Halt, But Retail Bets On A Rebound

Keros Therapeutics Inc. shares lost over three-quarters of their market capitalization on Thursday, marking an all-time low, after the company halted two high-dose arms in its Phase 2 TROPOS trial of cibotercept for pulmonary arterial hypertension. 

The voluntary pause followed a safety review identifying unexpected adverse events, including pericardial effusion.

Dosing in the 1.5 mg/kg arm continues after a benefit-risk assessment, and Keros plans to report topline data from all treatment arms by Q2 2025. 

The company is collaborating with the FDA and other regulators to address the safety concerns.

Wall Street turned bearish on Keros following the news. 

TD Cowen, William Blair, and BTIG downgraded the stock (to ‘Hold’, ‘Market Perform’ and ‘Neutral’, respectively), citing increased uncertainty and potential regulatory hurdles. 

BTIG noted that safety concerns might necessitate stringent FDA labeling, complicating the drug’s path to market.

Despite the crash, retail sentiment on Stocktwits turned ‘extremely bullish,’ with the ticker trending among the top five on the platform. 

Optimistic users highlighted Keros’ broader pipeline, including its potential in obesity treatments and other promising partnerships.

Earlier this month, Japan’s Takeda Pharmaceuticals agreed to a deal worth over $1 billion for Keros’ elritercept, which is being developed for anemia and could rival Bristol Myers Squibb’s Reblozyl.

Other highlights from Keros’ pipeline include KER-050, its lead candidate for anemia, which received FDA fast-track designation in March, and KER-065, being studied for Duchenne muscular dystrophy and obesity.

Keros shares have lost more than 60% year-to-date, but retail investors appear undeterred for now, speculating on a potential rebound fueled by its long-term opportunities.

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