Nurix Therapeutics said on Tuesday that Sanofi has decided to discontinue development of an experimental treatment for autoimmune and inflammatory diseases, eliminating potential future milestone payments and royalties related to the program.

Shares of Nurix plunged 38% in extended trading.

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The US biotech company said Sanofi (SASY.PA) had notified it of its decision to stop the development of SAR448272, an oral drug candidate, after discontinuing an early-stage trial As a result, Nurix said it does not expect to receive any future development, regulatory or commercial milestone payments, or royalties associated with the treatment Sanofi did not immediately respond to Reuters' request for comment Nurix added that it remains eligible for milestone payments and royalties from other drug candidates being developed under its collaboration agreement with Sanofi "While today's news is disappointing, Nurix remains in a strong position," CEO Arthur Sands said in a statement, citing the company's clinical-stage and preclinical pipeline Nurix said it had cash, cash equivalents and marketable securities of about $1.1 billion as of August 31, which it expects to fund operations into the second half of 2029 Under a collaboration signed in 2019, Nurix used its targeted protein degradation platform to discover drug candidates for Sanofi In 2025, Sanofi expanded the partnership by licensing two programs that target transcription factors for autoimmune and inflammatory diseases, including the now-discontinued candidate, Nurix said