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FDA agrees to review Biogen’s Alzheimer’s drug

The Food and Drug Administration has agreed to review an approval application for Biogen’s experimental Alzheimer’s disease medication, the company announced Friday. The review period has a deadline of March 7, 2021.If approved, Biogen’s aducanumab would become the first drug marketed as a treatment for the underlying cause of Alzheimer’s — a title that would likely drive billions of dollars in sales. An antibody drug, aducanumab binds to sticky conglomerations of a protein called amyloid beta, which many researchers believe impairs neurological function when it misfolds and bunches up.Biogen’s approval application hinges on two large clinical trials of patients with early Alzheimer’s disease. An initial look at the studies suggested neither would succeed, but upon further evaluation, Biogen claimed there was enough positive data to warrant approval. Yet the results, as well as how Biogen analyzed them, have drawn criticism from, and division within, the Alzheimer’s research community.

An aducanumab approval could help steady Biogen as it works through the challenges that threaten its business. Competition has weighed heavier on the company’s two best-selling products, at the same time that its pipeline of experimental neuroscience drugs has drawn more concern than excitement from investors.

But while Biogen cleared one hurdle in getting the FDA to review its application, a stamp of approval is far from guaranteed. Wall Street analysts have estimated the probability of such an outcome to be in the roughly 30% to 50% range.

“At a high level this all sounds great, but at the same time, there still are a ton of questions surrounding the aducanumab dataset,” Stifel analyst Paul Matteis wrote in an Aug. 7 note to clients.

Many of those questions revolve around the disparate findings from the two large clinical studies. Despite being identical in design, one study showed patients experienced less decline on a cognitive test after receiving a high dose regimen of aducanumab, while the other study showed the opposite, with patients given placebo performing better than those on the high dose.

Biogen has offered an idea as to why the study outcomes were so different: the failed trial did so because fewer patients received the most effective dose of the drug. Whether that idea passes muster with the FDA is unclear.

In addition to the data uncertainties, there have been questions about the FDA’s view on neuroscience drugs and how that could impact the agency’s decision. Notably, Biogen said Friday that it didn’t have to use a special voucher for the FDA to agree to a speedy review of aducanumab, which, Jefferies analyst Michael Yee wrote, suggests the agency sees the application as important.

Indeed, the review is likely to draw national attention, given the crucial need for new therapies for Alzheimer’s. But Baird analyst Brian Skorney, who has long doubted that aducanumab is effective, doesn’t expect the agency to give into the pressures to approve it.

“Given the history of the FDA Division of Neurology’s ability to provide sound critique of unsupportable applications, we believe the review will be negative but acknowledge that political pressure continues to play a clear role in everything at FDA these days,” Skorney wrote in a note to investors Friday.

The drama will be on display publicly, as Biogen announced the FDA is planning to hold an advisory committee meeting on an as-yet undetermined date. The meeting will have company representatives and a team of FDA staff debate the merits of aducanumab in front of a panel of experts, which will then make a recommendation to the agency about whether or not to approve the drug. The meeting is expected to be “one of the most watched and anticipated reviews in a very long time,” according to Yee.

Yee expects Biogen shares to trade above $500 apiece if aducanumab gets approved, with the assumption that the drug reaches peak yearly sales of $5 billion to $10 billion. If rejected, the stock could fall to $225 per share, according to Yee.

Biogen shares were up 9% Friday morning, to trade a little higher than $302 apiece.