Biogen Analysts Divided Over Alzheimer's Drug Following CTAD Presentation

Following Biogen Inc's BIIB presentation of detailed top-line results for aducanumab at the Alzheimer's conference, the stock ended Thursday's session up about 3.5%.

The presentation polarized analysts and clinicians alike, stirring a debate on whether the data is sufficient for the FDA to greenlight the drug.

The Analysts

Cantor Fitzgerald analyst Alethia Young maintained a Neutral rating and $300 price target. (See her track record here)

Raymond James analyst Steven Seedhouse reiterated a Market Perform rating. (See his track record here)

H.C. Wainwright analyst Andrew Fein reiterated a Buy rating and $335 price target. (See his track record here)

Debates Likely to Continue Into Adcom Meeting

Aducanumab data looked better than expectations, but questions remain around the negative ENGAGE and ARIA events, Young said, citing key opinion leaders.

The analyst pointed to the fact that the company failed to show the p-value for the patients post-PV4 on the CDR-DB analysis for both trials at high dose. The p-value could be critical to understand the strength of the post hoc analysis in the high exposure group.

The panelists who spoke after the presentation, according to the physicians, appeared to be one-sided in favor of aducanumab. Young noted that there was mixed reception to the data in the medical community.

As such, Cantor said the debates will likely continue into the AdCom panel meeting in 2020.

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Waiting Until The Saga Saga Resolves

Aducanumab is likely to be rejected at the FDA altar, as the Phase 3 program failed, Seedhouse said.

Invalidity of data presented to explain why the two Phase 3 trials diverged on key clinical endpoints and thus failed a futility analysis in March is self-evident. The analyst, therefore, assigned a zero probability of aducanumab being approved.

Approving aducanumab that causes ARIA in a mechanism-and-dose-dependent manner would mean FDA approving a drug that definitely adds risk and may add benefit, which is not the FDA's mandate. That said, Seedhouse said Biogen has only itself to blame for failing to prove the efficacy by "botching the trial design and/or botching the statistical analysis."

"In our view, the most responsible thing to do with the drug is run another trial (say, using PV4) and the most reasonable thing to do with the stock is to simply be uninvolved until this saga resolves, likely with an RTF or CRL, and sensibilities normalize," Seedhouse wrote in a note.

Aducanumab Can Offer Significant Potential Improvement

Biogen's presentation offered further context based on its larger dataset to resurrect the anti-amyloid beta antibody aducanumab, Fein said.

The analyst said the positive results were due to greater patient exposure to higher dose aducanumab over time and a larger comprehensive dataset compared to the original futility analysis.

The EMERGE trial's 23% reduction in clinical decline in CDR-SB dementia score at 78 weeks for the high dose, according to the analyst, is important as the management had indicated more than 20% improvement as clinically meaningful for these patients.

"Despite the noted complexities of the data, heterogeneous dosing, and drawbacks observed from the ENGAGE trial, we view the presented dataset positively and we continue to believe aducanumab can offer significant potential improvement addressing clinical decline in AD patients, in our view," Fein wrote in a note.

Price Action

Biogen shares, which have traded in a 52-week range of $215.78-$344, traded around $302 per share at time of publication.