2 Sympathy Plays To Watch For In The Wake Of Biogen's Positive Alzheimer's Drug Data

Biogen Inc. BIIB and partner Eisai Co. Ltd. ESALY announced late on Tuesday positive Phase 3 results for their second-generation Alzheimer's treatment candidate lecanemab.

What Happened: Biogen-Eisai’s late-stage trial would provide “strongly persuasive” data for the first time to support amyloid as a key component of Alzheimer's, SVB Leerink analyst Marc Goodman said.

Research on Alzheimer's treatment is based on two main hypotheses — amyloid cascade and tau hyperphosphorylation.

The amyloid cascade hypothesis states that amyloid plaques formed outside the cells by the aggregation of amyloid beta protein are the main cause of the neurodegenerative disorder. The tau hypothesis blames Alzheimer's on neurofibrillary tangles made of up modified tau protein, which is found in neurons.

Goodman expects the positive results to reinvigorate the Alzheimer's space.

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Why It's Important: The positive results reported by Biogen-Eisai will increase investor focus on near-term anti-amyloid beta monoclonal antibody readouts from Roche AG RHHBY and Eli Lilly & Company LLY, Goodman said in the note.

Roche is evaluating a candidate called gantenerumab in the GRADUATE Phase 3 study. The Swiss pharma giant is expected to read out from the study in the fourth quarter.

Lilly, for its part, will release results from the TRAILBLAZER ALZ-2 study of donanemab, another amyloid-targeting Alzheimer's candidate, in the first half of 2023.

When these readouts are in, investors are likely to focus on any potential differentiating features that emerge, Goodman said.