Biogen scraps Alzheimer drug trials, shares slump by a quarter

TOKYO/BENGALURU (Reuters) – Biogen and partner Eisai Co Ltd are ending two late-stage trials testing the experimental Alzheimer’s drug aducanumab, marking the latest setback for an industry racing to develop treatments for the memory-robbing disease.

FILE PHOTO: A sign marks a Biogen facility in Cambridge, Massachusetts, U.S. January 26, 2017. REUTERS/Brian Snyder

Analysts expect the successful development of a treatment for Alzheimer’s, which affects about 5.7 million Americans, to virtually guarantee multi-billion dollar annual sales, but experimental treatments have had a dismal track record with more than 100 failures.

Shares in Biogen slid 26 percent in premarket trading to $235. Japanese markets were closed for a national holiday.

The decision to discontinue the trials was made after an independent data monitoring committee reported the drug was unlikely to be successful, the companies said. The recommendation was not based on safety concerns, they added.

The trials ended just two weeks after Eisai’s CEO expressed confidence in the drug. “I believe we have already gone through the riskiest stage,” Haruo Naito told a press conference earlier this month.

Investors have long been skeptical of Biogen’s Alzheimer drug pipeline and the company has been making acquisitions to diversify its potential future treatments.

SVB Leerink analyst Geoffrey Porges said in a note that the brokerage could not find any near term catalysts that would help Biogen’s stock recover above $300.

Big drug companies including Eli Lilly, AstraZeneca Plc, Roche AG, Pfizer Inc, Merck and Co Inc, and Johnson and Johnson have all previously abandoned Alzheimer drug trials over lack of effectiveness or safety concerns.

Still, Biogen said it would not abandon its efforts to develop a treatment.

“This disappointing news confirms the complexity of treating Alzheimer’s disease and the need to further advance knowledge in neuroscience,” Biogen Chief Executive Officer Michel Vounatsos said.

“We will continue advancing our pipeline of potential therapies in Alzheimer’s disease.”

The companies will also discontinue a mid-stage study and a long-term extension study of aducanumab which was designed to target the brain-destroying protein beta amyloid.

Reporting by Tamara Mathias in Bengaluru; Takashi Umekawa in Tokyo; Editing by Shinjini Ganguli and Kirsten Donovan.