Biogen didn't just win the most closely watched FDA green light of the year. Its newly minted Alzheimer's disease drug, Aduhelm, snared an approval that covers all Alzheimer's patients, not just a select group of them, meaning millions could be eligible.
And it set an aggressive price tag, in the words of one analyst, that's several times higher than market watchers had predicted—roughly $56,000 for the average patient.
The upshot? Some $10 billion in peak sales, analysts say. And "one of the biggest launches in biopharma history."
Aduhelm, also known as aducanumab, will face its challenges. With the much-publicized controversy over its approval—including a scathing thumbs-down from an FDA advisory panel—some doctors will need convincing to prescribe it, and some patients might be skeptical as well.
Before the approval, analysts were torn on whether Biogen would score the Alzheimer’s nod at all. Some placed the drugmaker’s chances of clean approval at less than a coin flip.
But it didn't just score its approval: It won an "almost shockingly broad" label, Bernstein analysts wrote to clients.
The FDA approved the drug for all Alzheimer's patients—totaling more than 6 million people in the U.S.—even though the drug was only studied in patients with early disease.
The agency also didn’t place a limit on treatment duration, suggesting patients could stay on Aduhelm “until either all plaque is removed or the patient progresses,” the Bernstein analysts noted. The treatment is a monthly IV infusion.
Aduhelm, under that label, has millions of patients to target, and they could all take the drug indefinitely. But there's another key variable in the launch equation—price—and Biogen came out aggressive.
Biogen set Aduhelm’s list price at $4,312 per infusion for a patient of average weight, or $56,000 per year—several times higher than experts had previously estimated. It’s well above the recommendation from the drug-cost watchdogs at the Institute for Clinical and Economic Review, which previously said Aduhelm should cost $8,300 per year—at most—given the “insufficient” evidence supporting its benefits. Several analysts had estimated the drug would cost around $10,000 per year.
Analysts have already started laying out lofty sales estimates. Aduhelm could reach $10 billion in peak sales, Bernstein analysts said in their note. Meanwhile, Cantor Fitzgerald analysts wrote that Biogen "is now set up for one of the biggest drug launches in biopharma history." The investment bank predicted peak sales of roughly $8.2 billion in 2028.
Biogen "has the potential to generate (at least) $10 billion in peak sales" and a successful launch "has the potential to completely change the profile of the company," Guggenheim analyst Yatin Suneja said, Reuters reports.
If one thing’s for certain, Biogen needed an FDA win for Aduhelm. The Massachusetts-based company has gone all-in on the drug amid serious troubles elsewhere in its business. Multiple sclerosis drug Tecfidera and spinal muscular atrophy med Spinraza have been facing increasing competitive pressures, dragging Biogen to a sales decline in 2020.
The FDA handed aducanumab an accelerated approval based on a surrogate endpoint—the destruction of amyloid plaques—rather than the drug's ability to slow cognitive decline. A reduction in those plaques is “reasonably likely to predict important benefits to patients,” the agency argued.
The endorsement is contingent on results from a confirmatory trial. But analysts weren't worried.
"We're confident the Street will not be overly concerned on this, and it would be done in a way that would not have significant jeopardy to stakeholders, in our view," Jefferies analysts said in a note Monday.
Shares of Biogen, which were halted Monday morning pending the FDA's decision, jumped roughly 52% to about $434 per share once trading resumed.
Even with an agency go-ahead in hand, analysts have said aducanumab could face a number of hurdles before it reaches patients. Physicians may be unsure who should get it and for how long, while payers may balk at its lofty price tag and erect barriers that could limit reimbursement, analysts warn.
After the approval, Mizuho analyst Salim Syed wrote to clients that there's "a lot of pressure" on payers and that insurers could point to the drug's data to "make this difficult for doctors and patients alike." The launch "may be not be as smooth at the market is currently implying," Syed wrote.