Biogen stock surged Wednesday after partner Eisai unveiled Alzheimer's treatment test results that two doctors reportedly described as "magnificent."
But questions do remain, analysts say. In the study called Clarity, Biogen and Eisai's experimental drug, called lecanemab, significantly cut down on beta amyloid, an abnormal protein in the brains of patients with Alzheimer's disease. This led to a 27% slower decline in cognition over 18 months. But roughly one in five patients experienced brain swelling or bleeding.
Still, analysts expect the Food and Drug Administration to approve lecanemab. The key challenge after that will be whether the Centers for Medicare and Medicaid Services opt to reimburse for the Alzheimer's treatment, Wedbush analyst Laura Chico said in a report.
RBC Capital Markets analyst Brian Abrahams remains bullish. He expects Biogen and Eisai to notch about $400 million in worldwide sales in 2024, growing to $5 billion by 2027 and $10 billion by 2031, even allowing for some market split with Eli Lilly, which is testing a rival drug.
"Palpable physician enthusiasm from presenters and audience likely speaks to broad use," Abrahams said in a note to clients. "Though we continue to believe initial uptake will take time as experience with patient selection and management, and administration infrastructure/formulation evolve."
On today's stock market, Biogen stock jumped 4.7% to 305.17. Eisai stock leapt 8.3% to 70.10.
Biogen Stock: Benefit As Early As Six Months
On multiple scales, lecanemab's cognitive benefit began appearing as early as six months and improved through 18 months. On a measure of functional benefit — patients' ability to perform activities of daily living — lecanemab led to a 37% improvement, Eisai said.
RBC's Abrahams says this improvement "is something we believe will be viewed as clinically meaningful enough that it would necessitate physicians discussing starting lecanemab for most of their potentially eligible patients."
Though lecanemab showed a broad benefit across patient groups, there was one major inconsistency in the results. Researchers split patients into groups based on their genetic makeup. Among patients with a specific mutation in their APOE4 gene, placebo recipients had better results on a scale of symptoms.
Patients with this genetic mutation are more susceptible to developing early Alzheimer's disease. But they also accounted for just 15% of patients in the study, in line with estimates that they account for just 10% of the entire patient population.
This is the group with the highest risk of brain swelling and bleeding "where lecanemab would be used cautiously if at all," Abrahams said. He kept his buy rating on Biogen stock.
Brain Swelling/Bleeding Still A Risk
Overall, 17.3% of patients who received the Alzheimer's treatment experienced swelling or bleeding in the brain. In comparison, 9% of placebo recipients had the same effect, dubbed amyloid-related imaging abnormalities, or ARIA. The side effect is common with beta amyloid-targeting therapies. Patients with APOE4 genetic mutations have a higher risk of ARIA.
In total, two out of 1,608 lecanemab recipients died vs. one out of 897 patients in the placebo group.
"Both cases (in the lecanemab group) had significant comorbidities and risk factors including (use of blood thinners) contributing to macro-hemorrhage or death," Eisai spokeswoman Libby Holman told Investor's Business Daily by email. "Therefore, it is Eisai's assessment that the deaths cannot be attributed to lecanemab."
The presenter made an argument for lecanemab's safety profile, but doctors will have to tread carefully, Wedbush's Chico said.
"Admittedly, he noted in a real-world context, physicians will have to be mindful as they manage potential ARIA-related events," she said.
Chico kept her neutral rating on Biogen stock, but boosted her price target to 247 from 218.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
