Biogen, Eisai drive rally in Alzheimer’s stocks as lecanemab succeeds in late-stage trial

Sep. 28, 2022 6:43 AM ETBiogen Inc. (BIIB)RHHBY, LLY, SAVA, ESALY, AVXL, ESALF, RHHBF, ANVS, PRTA, ACIU, ABOS, CGTXBy: Dulan Lokuwithana, SA News Editor53 Comments

Alzheimers Concept Horizontal

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Biogen (NASDAQ:BIIB) and Japanese drugmaker Eisai (OTCPK:ESALF) (OTCPK:ESALY) announced their experimental Alzheimer's medication lecanemab met the main goal in a large late-stage trial, sparking pre-market gains Wednesday in companies with similar drugs in development.

The treatment was found to have cut the cognitive and functional decline of patients with early stage of the disease by 27%, compared to placebo, over 18 months in a study involving nearly 1,800 patients, the companies said Tuesday after the close.

The monoclonal antibody, designed to clear the beta-amyloid plaques in Alzheimer's brain, is similar in mechanism to a previous FDA-approved mediation that Biogen (BIIB) and Eisai (OTCPK:ESALF) developed but failed to gain Medicare coverage amid controversy over its clinical benefit.

While Biogen (BIIB) has added ~40%, Eisai (OTCPK:ESALF) shares closed ~17% higher on the Tokyo Stock Exchange.

The "study results prove the amyloid hypothesis, in which the abnormal accumulation of [amyloid-beta] in the brain is one of the main causes of Alzheimer's disease," noted Eisai Chief Executive Haruo Naito.

Eli Lilly (LLY), and Roche (OTCQX:RHHBY) (OTCQX:RHHBF), both of which are advancing similar anti-amyloid drugs for Alzheimer's in late-stage studies, have added ~8% and ~5%, respectively.

Cassava Sciences, Inc. (SAVA), which is developing its Alzheimer's candidate simufilam in two late-stage trials involving patients with mild-to-moderate Alzheimer's, has gained ~10%.

Other notable gainers in Alzheimer's space include Prothena Corporation (PRTA), Acumen Pharmaceuticals (ABOS), Annovis Bio (ANVS), Anavex Life Sciences (AVXL), Cognition Therapeutics (CGTX), and AC Immune (ACIU).

Meanwhile, on Wall Street, lecanemab data has prompted Baird to upgrade Biogen (BIIB) to Outperform from Neutral. Noting a best-case scenario with the readout, the analyst Brian Skorney argued that the results should not only lead to approval and reimbursement but also make it challenging for rivals to match.

The FDA has granted priority review for lecanemab as a treatment for early Alzheimer's disease, and the regulator is expected to make a decision by Jan. 06.

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