Biogen stock jumped — as Ionis stock gave back early gains — after a Food and Drug Administration panel offered a mixed view of their treatment for a deadly neurodegenerative condition.
The companies are hoping to win approval for tofersen, a potential treatment for a rare form of ALS, or amyotrophic lateral sclerosis. Also known as Lou Gehrig's disease, the condition leads to worsening muscle weakness and eventually death.
Biogen and Ionis Pharmaceuticals studied tofersen in patients with a genetic mutation known as SOD1. There are about 330 patients in the U.S. with this form of ALS. Late Wednesday, an FDA panel of experts voted unanimously, saying the presence of a biomarker in patients' blood suggests tofersen works.
But only three panelists said the evidence is enough for a traditional approval. Five said no and one abstained. Still, SVB Securities analyst Marc Goodman expects tofersen to win accelerated approval late next month. He notes the companies are also working on a study to confirm tofersen's benefit.
On today's stock market, Biogen stock popped 1.5% and closed at 265.17. Ionis stock, which soared in premarket trading, reversed and skidded 4.7%, ending the regular session at 33.62.
Biogen Stock, Ionis Stock: Accelerated Approval Likely
The biomarker question is an important one for Biogen and Ionis. Patients who received tofersen had lower levels of neurofilament in their blood. Neurofilament is a marker of neurodegeneration. All nine members of the FDA's Peripheral and Central Nervous System Drugs Advisory Committee said the presence of neurofilament suggests tofersen is likely doing its job.
But on a bearish note for Ionis stock and Biogen stock, only three panelists said the evidence supports a traditional approval. Traditional approval usually requires two Phase 3 studies. Biogen and Ionis ran one Phase 3 study called Valor and are enrolling a second called Atlas. The companies expect to have the Atlas results in 2027.
Goodman kept his outperform rating on Biogen stock, but added there are very few patients with ALS and the SOD1 genetic mutation. In a note to clients, he said he sees a peak of $300 million in U.S. sales.
Similarly, RBC Capital Markets analyst Luca Issi expects tofersen to win accelerated approval.
"Overall, most panelists agreed that risk benefit/profile is favorable in the context of a devastating disease that is 'extremely rare,' " Issi said in his note to clients. "While the vote is not binding, we think tofersen is likely to get accelerated approval with ongoing Atlas study to serve as confirmatory evidence."
Issi has an outperform rating and 65 price target on Ionis stock.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
