Biogen stock is down on a report that only around 100 patients have received its approved Alzheimer’s treatment Aduhelm as of Sept. 11.
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Investors’ deepest worries about Biogen
‘s controversial Alzheimer’s therapy seemed to be coming true early Wednesday. Health-care news site STAT revealed that only around 100 patients had received Biogen
‘s newly approved Alzheimer’s disease therapy Aduhelm as of Sept. 11.
Investors had expected the launch to go slowly, and Biogen (ticker: BIIB) has tried to limit expectations in recent months. Still, the STAT report suggests that the rollout is going even worse than investors had thought.
According to STAT, Biogen executives are now thinking about spending cuts, and possibly layoffs, due to the slow Aduhelm uptake.
Biogen stock is down 2.6% in Wednesday morning trading. The company did not respond to specific questions from Barron’s early Wednesday about the report. Instead, Biogen shared a statement, parts of which also appeared in the STAT piece. “We continue to see a high level of patient interest and we are making steady progress, including new site activations,” the company said. “Upgrading the infrastructure and establishing access pathways for a first of its kind medicine takes time.”
Biogen shares spiked in early June, when the Food and Drug Administration approved Aduhelm despite a searing objection late last year from an FDA advisory committee, jumping 38.3% in a single day.
Shares are down 25.3% since then. A wave of objections and criticisms from doctors and scientists came immediately after the approval, and significant questions arose about insurer coverage of the drug.
Shares fell in early September after the company’s CEO, Michel Vounastos, acknowledged at an industry conference that the rollout of Aduhelm was going slowly. “Although we are facing some near-term challenges, and everybody can see that, we continue to see a very high level of physician and patient interest, and we continue to believe the mid- to long-term opportunity remains significant,” Vounastos said at the conference, which was hosted by Morgan Stanley.
Another Biogen executive speaking at the same event blamed, among other things, an ongoing process launched by the Center for Medicaid and Medicaid Services to determine whether to limit coverage of Aduhelm. The executive, Biogen U.S. president Alisha Alaimo, said that the majority of sites that could infuse Aduhelm are waiting for “clarity on reimbursement,” and the outcome of the CMS process.
The Biogen executives did not say at that conference how many patients had received Aduhelm so far, but Alaimo said that they were “now aware of approximately 50 sites that are now infusing Aduhelm.”
Biogen reported in July $2 million in sales of Aduhelm in the second quarter of the year, short of the FactSet consensus estimate of $6.3 million. At the time, Biogen said it expected “modest Aduhelm revenue in 2021.” Analysts now expect $71 million in sales of Aduhelm this year, already down from the $121 they had expected in late June.
According to STAT’s calculations, 10,000 patients would have needed to start on Aduhelm before the end of the year to hit the Bloomberg analyst consensus estimate of $73 million. Given STAT’s reporting that only 100 have started so far, that number no longer seems within reach.
On Tuesday, Biogen held an investor day highlighting its pipeline progress that received mixed reviews from analysts. In a note out late Tuesday, SVB Leerink analyst Marc Goodman wrote that the lengthy presentation had confirmed his view that the company has a “strong disciplined approach to drug development in a very risky area,” and an interesting portfolio of opportunities “still underappreciated by investors.” Goodman has an Outperform rating on Biogen stock, with a $475 price target.
A contrasting takeaway came from Salim Syed, an analyst at Mizuho, who wrote Wednesday that the company made “no clear case for growth” beyond Aduhelm.
“This was the opportunity that Biogen had to showcase its pipeline beyond Aduhelm,” he wrote. “Bottom line, there was really nothing material that came out of the event that investors can now point to as the next leg of growth, in case Aduhelm underwhelms consensus.” Syed rates Biogen stock at Neutral with a $300 price target.
Write to Josh Nathan-Kazis at [email protected]
