Biogen Inc. shares surged more than 18% Friday after the biotechnology company and Tokyo-based Eisai Co. Ltd. announced positive results from a mid-stage trial of a treatment for Alzheimer’s disease.
The final analysis at 18 months of the 856-patient Phase 2 clinical study of BAN2401 in early Alzheimer’s disease demonstrated statistically significant slowing in cognitive decline and reduction of amyloid beta accumulated in the brain, the companies said in a release late Thursday.
Amyloid beta are the protein fragments that are found in the brains of patients suffering from the disease and that some believe cause it.
“New data provide compelling evidence to further support amyloid hypothesis as a therapeutic target for Alzheimer’s disease,” the companies said.
“We will discuss these very encouraging results with regulatory authorities to determine the best path forward,” said Lynn Kramer, chief clinical officer and chief medical officer, neurology, at ESALY, +21.52%
Analysts mostly welcomed the news, especially after earlier data from the trial that proved disappointing.
Alzheimer’s is the most common form of dementia and affects about 50 million people worldwide, according to the Alzheimer’s Association. There is still no cure for the disease or way to stop its progression, although the U.S. Food and Drug Administration has approved some medications to treat symptoms related to memory loss, language and other thought processes.
“While few specifics are available, we believe these results offer patients some hope as they lift the sentiment around the potential to find a treatment for slowing disease progression in Alzheimer’s (in which no product has worked so far), and more specifically around the anti-amyloid approach toward AD (which has seen several failed attempts in the past),” Canaccord analyst Sumant Kulkarni wrote in a note.
For investors, the results are likely a pleasant surprise after a 12-month review of the data had “failed” in the same trial, said Kulkarni. The analyst is making no changes to Biogen’s BIIB, +19.63% model, which does not include any value for BAN2401.
“That said, we believe the thesis around our recent upgrade of BIIB is now firmly on track, and we are reiterating our buy,” he wrote.
Mizuho analyst Salim Syed, who also rates Biogen a buy, asked whether the news could help propel the stock back toward the $400 level again soon.
“As of last night and prior to the BIIB BAN2401 news, the stock was sitting again at $300,” Syed wrote in a note. “BAN2401 is a more advanced dataset than Aducanumab’s PRIME Ph 1B trial.”
Aducanumab is another Biogen treatment for Alzheimer’s that is currently in Phase 3 trials. Aducanumab is an antibody that clings to amyloid beta and reduces their ability to develop into plaques.
But Leerink analyst Geoffrey Porges took a more downbeat view of the data, noting a lack of detail from a complex trial.
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“We do not feel that Biogen, Eisai or the whole amyloid field deserves much credit for this disclosure,” he wrote, noting the lack of external validation for the ADCOM’s endpoint, or Alzheimer’s disease Composite Score, a goal created by Eisai researchers.
“There is very little detail about other more validated cognitive measures in the joint press release and we find no reason to believe this either proves or disproves the amyloid hypothesis or has any impact on the likelihood that aducanumab will succeed in its ongoing phase III trial,” the analyst wrote.
Like Canaccord, Leerink does not include BAN2401 in its revenue forecasts for Biogen, and said it would not do so without more detailed data and disclosures, as we ll as more independent evaluation of clinical effects. Leerink rates Biogen at market perform.
Biogen shares have gained about 9% in 2018, outperforming the S&P 500’s SPX, +0.85% 3% gain.