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Biogen’s stock fell on Thursday after chief executive Michel Vounatsos admitted that the launch of the controversial Alzheimer’s drug, Aduhelm, had been “slower than expected.”
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Vounatsos blamed “confusion, misinformation and controversy” surrounding the drug’s data and fast-track approval. This approval was based on what is called a substitution endpoint. This means Biogen (BIIB) has yet to prove Aduhelm’s clinical benefit in further testing.
On the stock market today, Biogen stock fell 6.7% to 300.15. This placed the shares well below the high of 468.55 after Aduhelm’s approval on June 7. Biogen shares have fallen since then, with major medical centers saying they will not administer Aduhelm.
Now, Vounatsos says Biogen may need to revisit its “already very low sales target” for the year.
Biogen Stock: Call for $ 10.76 Billion in Sales
In the second quarter – the quarter in which Aduhelm received approval – Biogen recorded $ 1.6 million in sales for the treatment of Alzheimer’s disease. At the time, financial forecasts assumed Aduhelm’s “modest” revenues in 2021, with sales expected to increase in subsequent years.
Biogen stock analysts currently forecast $ 10.76 billion in full-year revenue for all products. Turnover would fall by nearly 20%. The dive comes as Biogen’s Tecfidera multiple sclerosis treatment faces new generic rivals. Aduhelm was Biogen’s hope to help avoid falling sales.
But only about 50 centers across the country have given at least a dose of Aduhelm, Vounatsos said at an investor conference hosted by Morgan Stanley.
The company firmly defended its Aduhelm thesis. Aduhelm works by removing beta-amyloid plaque that has built up in the brains of patients with Alzheimer’s disease. Not all experts agree that removing this plaque is good for cognition.
Medicare making looms
Next, investors in Biogen shares research the Centers for Medicare and Medicaid Services to determine if they will cover Aduhelm. This process will take months. Aduhelm’s list price is $ 56,000 per year. This is the price before discounts and rebates.
Some have said that Aduhelm is going to break the Medicare bank.
It is estimated that one million to 2 million people in the United States would receive Aduhelm. The Kaiser Family Foundation estimated that if just 1 million people received the drug, it would cost Medicare $ 57 billion in one year. This far exceeds the agency’s total Part B expenditure for other drugs.
In addition to Biogen’s stock market dive, shares of Eli lilly (LLY) stumbled 5.8% to 240. Lilly is working on a next-gen version of Aduhelm. He is also being tested on a drug called donanemab which also clears the buildup of amyloid in the brain.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
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