Biogen CEO George Scangos is headed out the door, and competitors might be circling.
Photograph by Mike Segar — Reuters

The pharmaceutical company's early drug trial aimed at combatting the disease had positive results. If future trials are successful, the drug could be a huge money-maker.

By Jen Wieczner
March 20, 2015

Biogen Idec wowed the market Friday by providing evidence that its Alzheimer’s drug may be the first to successfully treat the underlying cause of the disease.

In a clinical trial, the drug showed a meaningful slowing of the cognitive declines and dementia associated with Alzheimer’s—an up to 82% improvement in mental symptoms compared to the control group after a year of treatment.

Presenting trial data for the developmental drug known as aducanumab, Biogen said that it had significantly reduced amyloid plaque buildup in the brain, which is considered a contributor of Alzheimer’s disease.

While the Cambridge, Mass.-based company still has a long way to go before winning FDA approval for the drug, the phase 1 trial results were so encouraging that some analysts suggested the treatment could eventually be worth at least $10 billion in sales. Biogen’s shares closed 10% higher after the company shared the data at a conference in Nice, France.

An effective treatment for Alzheimer’s has long eluded the pharmaceutical industry. Part of the problem is that researchers have struggled to definitively link a particular gene or marker to the disease. Biogen may have confirmed such a relationship, raising the possibility of treating people with Alzheimer’s by identifying a target for future medications. Drugs that can alleviate dementia and other cognitive symptoms could help the 5 million Americans who have the disease.

Where Biogen BIIB may have really excelled, though, was in the design of its clinical trial, rather than the drug itself. To start, the company carefully screened prospective trial participants using PET scans to make sure they actually had the amyloid plaques that the drug targets.

That additional step, say experts, may be why Biogen’s drug achieved a statistically significant benefit while other companies have failed with their experimental treatments, such as Eli Lilly’s solanezumab, which flopped in multiple trials. “Anywhere between 20 to 30% in the trial probably could not have benefited from the therapy,” Andy Acker, manager of the Janus Global Life Science fund, says of the other studies. “That creates a lot of noise.”

Biogen also selected only patients with early or mild forms of Alzheimer’s for its trial, which may have made it easier to show a bigger cognitive improvement. “The magnitude of the efficacy improvements is really striking,” says Mark Schoenebaum, a biotech and pharmaceuticals analyst for Evercore ISI.

And if the company can replicate similarly impressive results in subsequent trials, it may have the very first blockbuster Alzheimer’s drug on its hands. “How valuable would it be to have a drug that actually could address the underlying cause of Alzheimer’s?” muses Acker. Answer: probably somewhere in the billions-of-dollars range.

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