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Late yesterday, the FDA announced plans to replace animal testing in the development of monoclonal antibody therapies and other drugs with human-relevant methods. The FDA's animal testing requirement will be reduced, refined, or potentially replaced using a range of approaches, including AI-based computational models of toxicity and cell lines and organoid toxicity testing in a laboratory setting (so-called New Approach Methodologies or NAMs data).

The FDA said implementation of the regimen will begin immediately for investigational new drug (IND) applications, where inclusion of NAMs data is encouraged.
We posted an InPlay comment last night on names being impacted, but now that we have had time to digest the news a bit, we wanted to provide more color.

News is seen as Positive for:

• Certara (CERT +19%) is seen as a key player in the shift toward reducing animal testing in drug development, particularly through its biosimulation and AI-driven modeling platforms.
• Recursion Pharma (RXRX +25%) provides an AI-driven drug discovery platform which should reduce reliance on animal studies. It uses machine learning to identify drug targets and optimize molecules.
• Simulations Plus (SLP +27%) is a leader in the biosimulation market by providing software and consulting services supporting drug discovery, development, research, and regulatory submissions. It is advancing alternatives to traditional animal testing through its computational modeling and simulation technologies.
• Schrodinger (SDGR +23%) is a leader in computational drug discovery and is actively working to reduce reliance on animal testing through AI and physics-based simulations.
• Absci corp. (ABSI +14%) focuses on AI-driven drug discovery with a focus on reducing reliance on animal testing through computational and high-throughput wet lab methods.

News is seen as negative for:

Charles River Labs (CRL +2.2%): CRL is a major supplier of animals used in testing. CRL dropped 28% as the news hit the wires late yesterday but it is recovering a bit today.