Sumitomo Pharma shares plunge 12% despite greenlight for Parkinson's treatment

Shares of Japanese drugmaker Sumitomo Pharma fell over 12% Friday on what appeared to be profit-taking, a day after the government endorsed the company's iPS cell-based therapy for Parkinson's and heart disease.The decision is a milestone in Japan's years-long effort to cultivate a homegrown sector focused on cutting-edge cellular therapies.Sumitomo Pharma's stock, which rose more than 300% in 2025, hit its highest level since 2019 last week amid growing confidence in its Parkinson's therapy. The therapies rely on induced pluripotent stem (iPS) cells — adult cells that are reprogrammed back into a stem-cell-like state."While the treatment could potentially see widespread use and become a blockbuster in Japan and the US over the long term, we expect almost no profit contribution near term," said Citigroup Global Markets Japan's analyst Hidemaru Yamaguchi.Sumitomo's stock has been overheated, and recent gains have been "excessive," he added.According to Japan's Ministry of Health, Labor and Welfare, formal approval will be granted within the next one to two months, NHK reported.The endorsement comes years after Kyoto University professor Shinya Yamanaka, who later won a Nobel Prize for his stem cell research, first succeeded in generating iPS cells from mice in 2006.Sumitomo Pharma develops and markets prescription medicines across multiple therapeutic areas, including neuroscience, oncology and regenerative medicine.Got a confidential news tip? We want to hear from you.Sign up for free newsletters and get more CNBC delivered to your inboxGet this delivered to your inbox, and more info about our products and services.© 2026 Versant Media, LLC.

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