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Biogen Stops Late-Stage Studies on Alzheimer's Candidate

Zacks Equity Research

Biogen BIIB and its Japan-based partner Eisai announced the discontinuation of two late-stage studies evaluating their Alzheimer’s disease (“AD”) candidate, elenbecestat. The decision was taken following a safety review conducted by the Data Safety Monitoring Board. The board’s recommendation to discontinue the studies was due to unfavorable risk-benefit ratio.

The two phase III studies with identical protocols were evaluating elenbecestat, an oral BACE inhibitor, in patients with mild cognitive impairment or mild AD, collectively known as early AD. Detailed data from these studies will be presented at future medical meetings.

The companies will also halt the long-term extension of the phase II study (Study 202), on elenbecestat, as part of this decision.

However, the discontinuation was expected by investors, following the failure of another AD candidate, aducanumab, in March. Shares were up almost 1.9% on Sep 13, presumably as investors anticipate lower expenses with termination of another fruitless but costly program. Shares of the company have declined 21.4% so far this year compared with the industry’s decrease of 1.7%

The decision to discontinue aducanumab development was taken following a futility analysis conducted by an independent data monitoring committee (“IDMC”). The analysis showed that the studies are unlikely to meet their primary endpoints. However, there were no safety concerns.

We remind investors that in July, Amgen along with partner Novartis NVS had announced the discontinuation of two pivotal phase II/III studies evaluating their BACE1 inhibitor, CNP520, to prevent or delay the symptoms of AD in a high-risk population.

Alzheimer’s, a fatal condition that causes progressive decline in memory, has always been a highly challenging area and not much progress has been made despite significant investments (both funds and resources). Several companies have failed to develop safe and effective treatment options for this deadly brain disease.

In January 2019, Roche RHHBY discontinued two late-stage studies evaluating its AD candidate, crenezumab as it was unlikely to meet primary endpoints of the studies as assessed by an IDMC.

In 2018, several large pharma companies, including Merck, Pfizer and Lilly/AstraZeneca stopped development of their AD candidates either due to low possibility of success or safety concerns.

Despite the setbacks, companies continue to invest heavily in developing AD treatments, given the high commercial potential in this market. Success in this area would lead to huge returns. This is because more than 5 million Americans are living with AD with the numbers expected to triple by 2050, per data from Alzheimer's Association. The market has immense commercial potential and companies coming out with new treatments could rake in billions of dollars in sales.

Biogen continues to develop another AD candidate, BAN2401, in a phase III Clarity AD study. Other companies working on Alzheimer’s disease treatments include Novartis, AstraZeneca AZN, Eisai, Alector and Amgen.

Biogen Inc. Price

Biogen Inc. Price

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Zacks Rank

Biogen currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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