Key Takeaways:
- GSK stock price registered there highest single day gains in more than 2 years.
- The shares reacted to news of US court dismissing the Zantac lawsuit.
NEW DELHI (CoinChapter.com) — GSK Plc’s (NYSE: GSK) stock price rose to a new multi-month high of $39.74 on Dec 7 after jumping 16% from its intraday low of $34.2, its best daily performance since March 2020.
The rally came in response to the news of a US Federal judge rejecting thousands of lawsuits against the company’s heartburn drug Zantac. Meanwhile, from a technical perspective, GSK stock price eyes a bullish continuation toward its interim resistance near $39, as shown below.
Furthermore, GSK’s relative strength index became overbought, currently clocking at 77.92 on the daily charts. Overbought RSI levels often precede trend reversals. GSK stock price has been rising since Nov 11.
If GSK stocks start falling, they might fall to test support near $37. Moreover, continued sell-off could force GSK stock price to drop to $34.9 before recovering.
Judge Says Zantac Suit Against GSK “Based On Flawed Science”
The dismissal by Judge Robin Rosenberg in Florida handed pharmaceutical companies GSK, Pfizer, Sanofi, and Boehringer Ingelheim a big win. In his order, Judge Rosenberg said that the nearly 2,500 lawsuits against the companies were based on flawed science.
However, the judge said that the only reliable testing of Zantac showed an “unprovable risk of cancer.”
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In detail, Zantac is the brand name for ranitidine, a heartburn medication. Several pharmaceutical companies, including GSK, Pfizer, and Sanofi, have sold the drug over the past 35 years.
The judge ruled that the expert witnesses that the plaintiffs had brought forward used “unreliable methodologies” and did not objectively evaluate the data surrounding the drug. Additionally, Judge Rosenberg noted that no scientist outside the litigation concluded that ranitidine might cause cancer.
Meanwhile, the plaintiffs’ lawyers hit out against the verdict, calling it a “miscarriage of justice.”
The firms might still face several personal injury cases filed in state courts.
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