Biogen Loses $8 Billion in Market Value in One Day After Failed Trial
June 8, 2016
By Mark Terry, BioSpace.com Breaking News Staff
Miracles can be hard to come by, and a potential miracle drug developed by Cambridge, Massachusetts-based Biogen , failed to meet the endpoints of a Phase II clinical trial.
Biogen has always been ambitious, and its success in the multiple sclerosis (MS) market has been dazzling. Investors and patients alike are hopeful that the company’s forays into Alzheimer’s disease will be as well. The company’s opicinumab (anti-LINGO-1), is an investigational, fully human monoclonal antibody that the company hoped would actually repair the nerve damage caused by MS. Unfortunately, the company’s Phase II SYNERGY study failed to hit the primary endpoint, a complex measure that evaluated improvement of physical function, cognitive function, and disability.
The company did say, however, that “evidence of a clinical effect with a complex, unexpected dose-response was observed,” although what that response was isn’t disclosed.
“It is only through taking thoughtful, calculated risks that we can bring major advances to patients,” said Alfred Sandrock, Biogen’s executive vice president and chief medical officer, in a statement. “Achieving repair of the human central nervous system through remyelination would be a substantial achievement, and while we missed the primary endpoint, the SYNERGY study results suggested evidence of a clinical effect of opicinumab. Due to the complex nature of the data set, we continue to analyze the results to inform the design of our next study.”
The drug also did not meet a secondary efficacy endpoint, looking at the slowing of disability of progression. The drug was well-tolerated and the safety profile was consistent with prior studies.
Biogen plunged on the news. Shares traded for $289.84 on Monday, June 6, and dropped to $252.58 on June 7. Shares are currently trading for $252.86. The company’s market value dropped by almost $8 billion.
The goal of Biogen was to push the company into a new period, where its drugs didn’t just slow the progression of MS, but could actually start to reverse the effects. It also had the possibility of being used to treat a number of neurological diseases that are caused by damage to myelin.
“While it could have been a revolutionary product,” said Eric Schmidt, a senior research analyst with Cowen and Co., to The Boston Globe, “expectations were very, very low.” Cowen and Co. had previously given the drug a 15 percent chance of success. “We think Biogen has a stable MS business these days, and that other pipeline programs could meet with success and could drive shares substantially higher.”
The company’s three other MS drugs are Avonex, Tysabri and Tecfidera, and each creates about $1 billion in annual revenue.
In the Phase II trial, Biogen compared opicinumab to Avonex. If opicinumab had been successful in the trial and continued to commercial development, it would have created an entirely new category of MS drugs.
“We are not surprised by the study’s failure,” Geoffrey Porges, an analyst with Leerink Partners wrote in a note to investors. “Opicinumab certainly had the potential to contribute substantial new revenue to Biogen…. However, the indication and the biology of this target are challenging.”
The company indicated it plans to continue analyzing data, which it will present at MS-related conferences in the future, possibly this fall.