On September 1, 2026, the Wall Street Journal first reported that Novartis AG (NYSE:NVS) paused eight clinical trials of its experimental CAR-T cell therapy rap-cel in autoimmune and neurological conditions, including lupus, rheumatoid arthritis, and multiple sclerosis. It happened after three patients died from immune effector cell-associated hemophagocytic syndrome, a rare and severe immune reaction.
Bristol-Myers Squibb Company (NYSE:BMY) separately paused enrollment in its own competing CAR-T program, zola-cel, as a precaution after observing what the company described as “transient and reversible” inflammatory events, though without any reported deaths.
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Bull Case
Novartis AG (NYSE:NVS) has limited the disruption to rap-cel’s autoimmune and neurological programs. The company’s two ongoing rap-cel trials in lymphoma and leukemia continue because the pause does not cover those studies. This separation protects the therapy’s more established oncology opportunity and allows Novartis to collect clinical data while investigators examine the autoimmune safety events.
Bristol-Myers Squibb Company (NYSE:BMY) faces a less severe disclosed safety situation than Novartis. The firm described its inflammatory events as transient and reversible and reported no deaths. It paused only new enrollment rather than stopping every aspect of the trials. This narrower response could give Bristol Myers a clearer path toward restarting enrollment if its safety review identifies an effective monitoring or treatment strategy.
The safety events may not invalidate the entire autoimmune CAR-T field. The therapies use specialized rapid-manufacturing processes, which researchers must evaluate as a possible contributor to the reactions. If investigators identify a controllable manufacturing or dosing issue, both companies could modify their protocols and preserve part of the programs’ long-term pipeline value.
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Bear Case
Three patient deaths create a major safety and development risk for Novartis AG (NYSE:NVS). The company paused all eight affected trials. It shows that the problem reaches across several autoimmune and neurological indications rather than one isolated study. Longer delays, stricter trial requirements, or program cancellations could increase research costs and remove potential future products from Novartis’ pipeline.
The companies’ disclosure timelines also create governance and reputational concerns. Bristol-Myers Squibb Company (NYSE:BMY) informed regulators and researchers in early June but waited about three months before informing the broader public. Novartis confirmed its pause only after an analyst noticed the halted trials in a public database. The company disclosed the deaths one week later. These delays could weaken investor trust and attract greater regulatory scrutiny.
Safety problems at two major drugmakers could slow the broader autoimmune CAR-T market. Regulators may demand more monitoring, smaller initial doses, longer follow-up periods, or more studies before allowing development to proceed. These requirements would increase costs, delay possible approvals, and push any future revenue further into the future, reducing the programs’ risk-adjusted value.
Hedge Fund Sentiment
Novartis AG (NYSE:NVS) hedge fund count grew to 38 in the second quarter from 31 in the first, with position value rising to $3.66 billion from $3.02 billion, according to Insider Monkey’s database, positioning built before this and Novartis’ other subsequent pipeline setbacks became public. Bristol-Myers Squibb Company (NYSE:BMY) saw hedge fund interest move in the opposite direction, with holders falling to 74 from 83 and position value declining to $4.79 billion from $5.97 billion.
Conclusion
Bristol Myers currently faces the less damaging situation because it reported reversible events, no deaths, and a narrower enrollment pause. Novartis faces substantially greater risk after three deaths forced it to halt eight trials, although its oncology studies remain active. Investors should treat both autoimmune programs as highly uncertain until the companies identify the cause of the reactions and secure regulatory support to restart enrollment. The safety reviews will determine whether these setbacks represent manageable clinical problems or a lasting loss of pipeline value.
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