Biogen's Alzheimer's Drug 'Falls Far Short Of Compelling Argument For Approval,' Baird Says In Downgrade

Biogen Inc BIIB shares gained more than 25% earlier this year when the company said it planned a regulatory filing for its Alzheimer's drug aducanumab following a new data analysis. 

Ahead of the Dec. 5 presentation of aducanumab data at the Clinical Trials on Alzheimer's Disease annual congress, Baird put forward a bearish thesis on why the pipeline asset is unlikely to receive FDA approval. 

The Analyst

Brian Skorney downgraded Biogen from Neutral to Underperform with a $250 price target.

The Thesis

Biogen's CTAD presentation could serve as a meaningful negative catalyst for Biogen, with the hype around aducanumab descending into broader critique of the full data set and the company's decision to file based on it, Skorney said in a Monday note. (See his track record here.)

When the clinical benefit as measured from the EMERGE study is characterized, it is going to disappoint, the analyst said.

The numerical benefit is around 0.4 points compared to 0.5 points for Eisai Co., Ltd's ESALY marketed drug Aricept and 0.34 points for Eli Lilly And Co's LLY pipeline asset solaneuzumab.

The safety disclosure for aducanumab is at the bare minimum, he said. 

Aducanumab falls far short of a compelling argument for approval, Skorney said. 

"The bottom line is, the FDA standard of approval is substantial evidence of efficacy and the cumulative data for aducanumab falls really far short of this standard to anyone but the most ardent GOOP subscribers." 

Price Action

Biogen shares were down 2.58% at $292.06 at the time of publication Monday. 

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