Despite rough start, Biogen's Aduhelm should find footing, analysts say. But don't expect much in 2021

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Biogen's long-term Alzheimer's opportunity "remains intact," but there are still some unanswered questions left to determine the drug's "true potential," the RBC analyst group said. (Biogen)

As Biogen's new Alzheimer's drug Aduhelm makes headlines nearly every day—many covering the drug's slower-than-expected uptake—one team of biopharma analysts is lowering its 2021 expectations for the med. Nonetheless, despite the drug sputtering out the gate, the team still sees a multibillion-dollar sales opportunity for the company in Alzheimer's disease.

Writing to investors Wednesday, analysts with RBC Capital Markets said they're lowering their third-quarter sales estimate for the drug to $5.5 million, with about $5 million of that figure expected to come from stockpiling. Their calculations suggest about 100 patients have received the med so far. 

On the other hand, Wall Street's third-quarter consensus projection is $16 million, "which would imply either significantly more stockpiling or patient numbers in the 1,000s rather than 100s," the RBC team wrote.

As for the fourth quarter, the team sees a "similar disconnect" between its estimate and Wall Street's consensus view. The RBC team is predicting $7.1 million, while the consensus estimate is $36 million.

The RBC team notes that Biogen's stock is trading much lower than it was right after the Aduhelm approval, suggesting that the market appreciates the "revised expectations" for the med. Still, some analyst estimates "need to come down ahead of earnings, which may drive further negative pressure/sentiment for the stock," the RBC team wrote.

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In the long run, Biogen's opportunity in Alzheimer's "remains intact," the RBC group added, but there are still some unanswered questions left to determine the drug's "true potential." While certain healthcare systems have opted against offering the treatment right away, RBC's research suggests the drug will eventually find some use based on the team's expectations for federal reimbursement and some support among doctors.

After its controversial FDA approval in June, Aduhelm is up for a pivotal reimbursement decision from the Centers for Medicare & Medicaid Services (CMS), expected to come in January. The RBC analysts think that "some form of reimbursement from CMS remains likely." 

Since its FDA nod, the drug has had to weather several setbacks. The Department of Veterans Affairs decided last month against adding Aduhelm to its formulary, while Massachusetts' largest healthcare provider this week said it won't administer the drug, The Boston Globe reports.

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Overall, the RBC team thinks that consensus figures for the med are "overly optimistic" right now. But the team doesn't discount Biogen's long-term opportunity in Alzheimer's.

Taking Aduhelm's potential into account plus the newly filed lecanemab, RBC Capital Markets analysts think Biogen could eventually capture $5.6 billion in annual Alzheimer's drug sales. On the competitive front, threats from Eli Lilly and Roche could disrupt the field down the line, the team pointed out.