Biogen's Japanese partner has a second Alzheimer's drug coming

[NEW YORK] Biogen Inc beat the odds, bringing the first drug intended to slow the progression of Alzheimer's disease to the US market. Investors are hoping Eisai Co Ltd, its Japanese partner in the medicine, can do it again with a second compound from the pair that's still in development.

The US Food and Drug Administration's backing of the drug Aduhelm may boost the chances for BAN2401 and Tokyo-based Eisai, which is in a sales and profit sharing agreement with Biogen for both treatments. The drugs work by targeting the beta amyloid protein that clogs the brains of patients with Alzheimer's disease.

Researchers long believed that interfering with the protein, a hallmark of the disease, was the key to treating the condition, but pharmaceutical companies spent billions of dollars on experimental compounds that failed again and again to slow the inexorable progression of the mind-wasting disease. Aduhelm is the first such medicine to make it to the market.

"This approval will have a halo effect on BAN2401 and the wider pipeline," said Jefferies analyst Stephen Barker. "It will certainly impact how the stock market evaluates the Alzheimer's research from Biogen and Eisai in general." The Japanese drugmaker partnered with Biogen in 2014 to co-develop several Alzheimer's related compounds. In 2017, Eisai exercised an option to expand the agreement to include Aduhelm, originally known as aducanumab.

Eisai's shares were untraded in Tokyo Tuesday amid a trading imbalance, as bids outweighed offers. Biogen shares closed at US$395.85, up 38.3 per cent in US trading.

Two Trials

Eisai is leading two pivotal trials on BAN2401, which also goes by the name lecanemab. Final results for the study in patients with early-stage disease are expected within the next year. The FDA's approval of Aduhelm may indicate a shift in how the agency thinks about Alzheimer's disease, and the sentiments are lifting expectations for the experimental compound's future.

"Our other drug lecanemab is also based on the beta amyloid hypothesis, so we are very encouraged by this approval," an Eisai spokesman told Bloomberg by phone.

Closer on the calendar are regulatory approval decisions for Aduhelm in Europe and Japan, which will likely come later this year, Barker said.

Japan's top government spokesman Katsunobu Kato said Tuesday that the country would review the drug in an appropriate manner, while Australia's Therapeutic Goods Administration said it is currently evaluating the medication.

For the Aduhelm agreement, Eisai will book sales in Asia outside of China and South Korea, while Biogen will book most of the rest of the world, including US and Europe.

Profits will be split about 50-50, with Biogen taking a greater share in US and Europe, and Eisai taking a greater share in Japan and Asia, other than China and South Korea.

BLOOMBERG