Biogen’s fortunes depend on it getting approval for its Alzheimer’s candidate aducanumab. The company's lacklustre third-quarter results, announced yesterday, emphasised this fact.
The project faces an US FDA advisory committee on November 6, and the agency usually – but not always – follows the advice of its panels, so the outcome will be a big indicator of whether aducanumab will get the nod. But predicting which way the panel will swing is tough: on the one hand is aducanumab's unconvincing efficacy and safety, and on the other a dire lack of options for Alzheimer’s patients.
During yesterday’s earnings call, Biogen execs were not giving anything away about what might be discussed at the hearing. The overall message was one of optimism, with Alfred Sandrock, head of R&D, stating: “We continue to believe that aducanumab has a substantial evidence of efficacy. If we didn't believe that we wouldn't have filed.”
Some sellside analysts are already trying to convince themselves, and investors, that adu is heading for a green light. Evercore ISI’s Umer Raffat pointed to “very positive” body language from execs on the earnings call, while Leerink wrote that the company’s management “sounds confident”.
Both sets of analysts were also cheered by the fact that, according to Biogen, the FDA has said that it plans to act early on aducanumab if possible, raising hopes of an approval before the project’s March 7 Pdufa date.
Indeed, Evercore analysts are taking the long gap between the adcom and Pdufa date as a positive sign. According to their dissection of past decisions, the shorter this period the more likely a drug is to get rejected. Furthermore, their analysis found a 20% increased probability of approval for every 100 days between the two dates. The time lag for adu is 121 days.
Still, these “clues” seem tenuous at best, and little should be read into the optimism of Biogen management. The picture will hopefully become clearer when the FDA releases its briefing documents, due two days before the panel hearing.
A signal Emerges?
It is easy to understand why the agency might be sceptical of the efficacy data supporting adu’s filing. Both of the project’s pivotal trials, Engage and Emerge, failed at an interim analysis. Biogen later said that this result had been incorrect, and that longer-term data showed a hit in Emerge, although not in Engage (Shock revelation sees Biogen erase its aducanumab losses, October 22, 2019).
A major debate is likely around the clinical relevance of data collected via such a post-hoc analysis.
Adu’s safety profile will also be under scrutiny. The project has been linked with a high rate of vasogenic oedema (Aria-E), or brain swelling. Mr Sandrock yesterday said Aria-E was manageable with drug titration and monitoring with MRI.
On the other side of the coin is the paucity of options for Alzheimer’s: current therapies can only manage symptoms, and no new drugs have been approved for the disease since 2002. Given the ageing population and growing incidence of Alzheimer’s, the FDA could come under pressure to approve a project that only hints at disease modification.
Even if adu is approved, getting payers onside could be another story. The US pricing watchdog Icer yesterday released a draft scoping document, stating its intention to compare the cost-effectiveness of adu plus best supportive care, versus supportive care alone.
Biogen’s chief executive, Michel Vounatsos, said yesterday that it was premature to discuss adu’s potential price, but that the company was working with Icer and other advisors here.
With adu’s chances of approval on a knife edge, Biogen might have been expected to turn to M&A to spread its risk. However, it is doing the opposite and doubling down – yesterday a $5bn share buyback scheme was unveiled.
True, the big biotech might not be in the best position to negotiate with potential targets. But this will not improve if adu is rejected, while the pressure to buy will only intensify.