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ALLISON GATLIN

Biogen Rises After 'Drama-Free' Panel Votes Unanimously In Support Of Alzheimer's Drug

Biogen stock drifted higher Monday after a panel of advisors to the Food and Drug Administration voted unanimously in favor of its newest Alzheimer's treatment.

Piper Sandler analyst Christopher Raymond called the Friday event "drama-free." Panelists voted unanimously that a study called Clarity-AD verifies the clinical benefit of Biogen's new Alzheimer's treatment, Leqembi.

Leqembi won accelerated approval in January and could soon gain the FDA's full approval. This will be key to winning reimbursement from the Centers for Medicare and Medicaid Services, which insures the lion's share of Alzheimer's patients.

"While the discussion on benefit/risk in various patient subpopulations sparked some differing of opinions, the general takeaway was to allow doctors/patients/caregivers to decide individual benefit/risk tolerance for treatment," Raymond said. "Overall, with the drama-free (advisory committee), we see little to quibble with ahead of the July 6 (potential approval date)."

On the stock market today, Biogen stock rose 1.5%, ending the regular session at 313.41. Shares were halted during Friday's regular session.

Biogen Stock: No Aduhelm Encore

Advisory committee meetings haven't always been drama-free for Biogen.

An earlier Alzheimer's drug, dubbed Aduhelm, won accelerated approval in 2021 despite losing out at its advisory committee meeting. Though it had the FDA's backing, CMS said it wouldn't reimburse for Aduhelm costs unless patients were enrolled in the confirmatory study. Biogen quickly backed off its Aduhelm marketing efforts.

Leqembi is Biogen's second shot in Alzheimer's treatment. Medicare has said it will pay for Leqembi if the drug gains full approval and for patients enrolled in a registry.

Leqembi works by removing an abnormal plaque in the brain called beta amyloid. Drugs in this class can cause brain swelling known as amyloid-related imaging abnormalities, or ARIA. ARIA is more common in patients with a certain genetic mutation, those taking blood thinners and patients with a condition called cerebral amyloid angiopathy.

But most panelists said patients should be informed of the risks and have a choice. Colette Johnston, a patient advocate and panelist at Friday's meeting, recalled being her father's primary caregiver following his Alzheimer's diagnosis.

"Even with the risks, and there are significant concerns there, I can't tell you what I would have paid to have this option," she said.

27% Slower Decline

In the Clarity-AD study, Biogen and partner Eisai said patients who received Leqembi had a 27% slower decline in cognition over 18 months than the placebo recipients. Further, Biogen stock rose on that news in late November.

During the meeting Friday, panelists focused on the effectiveness, safety and statistics surrounding Leqembi. Johnston, the patient advocate, says patients with Alzheimer's are well versed in risk.

"Every day of an Alzheimer's patient's life or their caregiver is just an endless series of making risk/benefit comparisons," Johnston said. "In that position, this would be an easy one for me."

Mizuho Securities analyst Salim Syed noted the statical presentation surrounding Leqembi was also seemingly in favor. Statistician Tristan Massie was highly critical of Biogen's first Alzheimer's drug, Aduhelm. His presentation during Aduhelm's advisory committee meeting involved 35 pages. He wrapped up the Leqembi presentation with nine pages.

"Very smooth presentation," Syed said.

He has a buy rating and 340 price target on Biogen stock.

Enthusiasm For Alzheimer's Treatment

Biogen stock has run up this year on enthusiasm for its efforts in Alzheimer's treatment. Unlike its first Alzheimer's drug to gain accelerated approval, Wall Street largely expects Leqembi to gain a traditional approval and reimbursement from Medicare.

Shares broke out of a double-bottom base with a buy point at 295.90 in late April, according to IBD MarketSmith charts. Now, Biogen stock is hanging out in the 5% chase zone, which runs from 295.90 to 310.70.

Biogen stock also has a strong Relative Strength Rating of 92, according to IBD Digital. This puts shares among the top 8% of all stocks when it comes to 12-month performance.

Follow Allison Gatlin on Twitter at @IBD_AGatlin.

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