Get 40% Off
⚠ Earnings Alert! Which stocks are poised to surge?
See the stocks on our ProPicks radar. These strategies gained 19.7% year-to-date.
Unlock full list

Biogen leans on new Alzheimer's drug to calm investor worries

Published 07/20/2022, 07:09 AM
Updated 07/20/2022, 05:25 PM
© Reuters. FILE PHOTO: A sign marks a Biogen facility in Cambridge, Massachusetts, U.S. January 26, 2017.  REUTERS/Brian Snyder/File Photo

By Manas Mishra

(Reuters) -Biogen Inc on Wednesday tried to assuage investor worries by laying out a plan for its Alzheimer's disease drug being developed with Eisai Co (OTC:ESALY) Ltd and promising to draw lessons from the setbacks to its treatment Aduhelm.

Biogen (NASDAQ:BIIB) also disclosed that it had agreed to pay $900 million to resolve a whistleblower lawsuit accusing it of paying doctors kickbacks to prescribe multiple sclerosis drugs. The case had been set to go on trial next week in Boston. It did not admit wrongdoing.

Biogen's experimental Alzheimer's drug, lecanemab, is crucial for the growth of the drugmaker as it faces competition for several of its blockbuster drugs, including multiple sclerosis treatment Tecfidera.

Lecanemab data is expected in the fall. Biogen and Eisai have filed for an accelerated approval and the U.S. regulator has set a January deadline.

"We'll take learnings from Aduhelm as necessary and as where we can and we'll resource (the launch) at each phase of its commercialization very gradually," Chief Financial Officer Michael McDonnell said.

In June, Aduhelm became the first treatment for Alzheimer's disease to be approved in the United States in decades, but Medicare, the government health plan for people over age 65, sharply curtailed its use on efficacy concerns.

Biogen in May had to significantly pull back the sale of Aduhelm, which generated $100,000 in the second quarter.

Since the drug's approval, Biogen shares have been nearly halved.

On Tuesday, the shares were trading 2% lower even as the drugmaker raised its full-year profit forecast. Sales fell 18% to $397.9 million, above expectations of $367.7 million.

"We suspect investors are not likely to be satisfied by upside from such legacy products," Piper Sandler analyst Christopher Raymond said.

© Reuters. FILE PHOTO: A sign marks a Biogen facility in Cambridge, Massachusetts, U.S. January 26, 2017.  REUTERS/Brian Snyder/File Photo

Biogen expects annual profit in the range of $15.25 to $16.75 per share, up from a prior forecast of $14.25 to $16.

Excluding items, it earned $5.25 per share, above estimates of $4.06. The profit was helped by a $500 million share repurchase program, Wedbush analyst Laura Chico said.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.