The Food and Drug Administration approved BiogenAlzheimer’s treatment (BIIB), obrazovanumab, on Monday – although the nutrient supply remains suspended in the long-awaited solution.
Aducanumab, now known as Aduhelm, is the first Alzheimer’s treatment novel to receive approval in nearly two decades. This is the first treatment that focuses on the underlying pathology of the disease. Other drugs treat the symptoms of the disease. But approval is accelerating, which means the FDA requires additional testing and can change its decision at any time.
This is probably due to the controversial nature of Aduhelm. The FDA had already kicked the can on its way once. In addition, experts do not agree on what causes neurodegenerative disease, nor how to treat it. And some say Biogen’s evidence is vague at best.
The FDA acknowledges the increased attention in its review. The agency said it had used a “fine-toothed comb” to analyze data it said were “unclear.”
“We understand that Aduhelm has attracted the attention of the press, Alzheimer’s patients, our elected staff and other stakeholders,” the FDA said in a news release. “With the treatment of a serious life-threatening illness in balance, it makes sense that so many people are monitoring the outcome of this examination.”
On the stock market today, Biogen shares were suspended before the decision. The shares remained suspended during the last actions.
Biogenic stock and educationumab
Experts do not agree on what causes Alzheimer’s disease.
Biogen’s Aduhelm relies on the beta amyloid theory, which suggests that the accumulation of toxic plaques in the brain is the culprit for neurodegenerative disease.
Aducanumab works by removing these beta amyloid plaques. In this way, Biogen hopes to slow down the cognitive decline of Alzheimer’s patients. The FDA agreed with this logic, saying removing plaque was “reasonably likely to predict significant benefit to patients.”
Biogen CEO Michel Vunazos celebrated the victory in a written statement.
“This historic moment is the culmination of more than a decade of groundbreaking research into the complex field of Alzheimer’s disease,” he said. “We believe that this first-class medicine will change the treatment of people living with Alzheimer’s disease and bring about continuous innovation in the years to come.”
Beta amyloid is an older theory
The beta amyloid approach is one of the oldest theories in Alzheimer’s disease. It also has some well-known failures, including Biogen.
In early 2019, Biogen said that obrazovanumab did not show an advantage in the two phase 3 tests known as Engage and Emerge. Then the nutrient reserves lost a third of their value. Months later, the company – and Biogen shares – reversed. Biogen said the Emerge study was actually a success.
This is based on an ad hoc analysis that the FDA helped complete.
Another failure is Eli Lily(LLY) solanezumab in 2016 Roche (RHHBY), Merck (MRK), Johnson and Johnson (JNJ) and others have eliminated all studies testing beta amyloid approaches to Alzheimer’s disease.
But Mizuho Securities analyst Salim Sayed suggested that FDA approval could confirm the treatment theory. The street plans $ 10 billion in sales for Aduhelm, he said in a customer report. It maintained its neutral rating and its price value of 244 for Biogen shares.
Voting participants shook up biogen stocks
To receive approval, the drug usually needs two successful phase 3 studies.
In early November, an advisory committee voted against the approval of obrazovanumab, saying that a successful Emerge study and a mid-level test called Study 103 were not enough for approval. Ten members of the commission voted no, one was uncertain and no one voted yes.
Several members of the commission went so far as to later write an article published in the Journal of the American Medical Association, a medical journal. The nutrient supply decreased the next day.
However, in its approval, the FDA claims that in all studies it has evaluated “Aduhelm consistently and very convincingly reduces the level of amyloid plaques in the brain” in terms of dose and time.
Make or break for nutrient stocks?
Many consider the decision to be a binary event for biogen stocks.
The company’s largest drug, multiple sclerosis treatment, called Tecfidera, faces generic competitors and sales are declining. Novartis has a gene therapy that competes with the treatment of spinal muscular atrophy of Biogen and Ionis Pharmaceuticals Spinraza.
For this reason, nutrient stocks are undergoing wild changes in the news about obrazovanumab.
Wedbush analyst Laura Chico says the drama is probably not over for Biogen shares. She sees “difficult decisions ahead” as doctors decide whether to prescribe Aduhelm and insurance companies decide whether to reimburse their treatment costs.
It raised its price target for Biogen shares to 300 from 240, but maintained its neutral rating.
Other biotechnologies with a likely impact
The decision could affect other companies in the Alzheimer’s area. Lilly has a new drug targeting beta amyloids called donanemab. Biogen and Japan’s Eisai are also working on a beta amyloid-focused drug called BAN2401.
But many others are testing newer approaches to the disease. These include names like Anavex Life Sciences (AVXL), Cortex (CRTX) and Athira Pharmaceuticals (ATHA).
Like nutrient stocks, Annovis Bio (ANVS) and Cassava science (SAVA) have also had huge changes in the news about Alzheimer’s treatment.
Wedbush’s Chico claims that Aduhelm’s approval decision is based on the only successful Phase 3 study, which sets a “weak precedent” for other approvals.
“The FDA’s decision poses a challenge for future sponsors with perhaps little precedent,” she said in a client report.
Follow Alison Gatlin on Twitter at @IBD_AGatlin.
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