ARS Pharma plunges 23% as CVS Caremark delays Neffy formulary decision

ARS Pharmaceuticals Corp. shares plunged 23% after CVS Caremark declined to add its epinephrine spray Neffy to its formulary.

The company disclosed the decision in a commercial update, saying no new major commercial insurers have added Neffy to their formularies since its launch. CVS Caremark, one of the three largest pharmacy benefit managers in the US, postponed any potential formulary inclusion until January.

The stock fell to $4.82 in after-hours trading, extending its decline for the year to more than 60%. Neffy, approved by the Food and Drug Administration in August 2024, was the first needle-free epinephrine treatment for severe allergic reactions, offering an alternative to auto-injectors such as Mylan's EpiPen.

The CVS decision represents a major commercial setback for ARS Pharmaceuticals, as formulary access is critical for patient adoption and prescription volume. Without CVS Caremark coverage, a significant portion of insured patients may face high out-of-pocket costs, limiting Neffy's market penetration. The drug's launch had been closely watched by investors as a test of demand for needle-free alternatives in the epinephrine market.

The company had been working to secure commercial insurance coverage since Neffy's launch, with previous announcements highlighting progress with select regional plans. The lack of a national PBM win leaves the drug at a competitive disadvantage against established epinephrine auto-injectors that have held formulary positions for years. Mylan's EpiPen and generic versions dominate the market, with decades of established prescribing patterns.

ARS Pharmaceuticals ended the regular session at $6.26 before the after-hours collapse. Trading volume surged to multiple times the daily average as investors reacted to the news.

The delay puts ARS Pharmaceuticals in a precarious financial position, as Neffy revenue was expected to be the company's primary growth driver. Investors will watch for any updates on formulary negotiations with other major PBMs, including Express Scripts and OptumRx, in the coming months. The company's cash runway and valuation will depend on its ability to secure broader coverage before the January review cycle.

This article is for informational purposes only and does not constitute investment advice.