Early in Leqembi's launch, Biogen's Alzheimer's disease sales are negative

You’ve got to spend money to make money, and for Biogen, that means an $18 million revenue hit attributable to the company's Alzheimer's portfolio.

As the drugmaker holds out hope for broader coverage of its Eisai-partnered Alzheimer’s med Leqembi, the program has yet to gain a commercial foothold. Thanks to nearly $19 million in charges related to the Eisai partnership, Biogen recorded negative $18 million in first-quarter Alzheimer's disease sales.

Biogen’s negative Alzheimer's revenue accounts for sales of both Aduhelm and Leqembi, the company explained in a press release Tuesday. Aside from that revenue hit, the company also took a $45 million charge related to idle manufacturing capactiy.

“[A]s we’ve said before, we do have a higher cost base than the average company in our category,” Biogen’s newly minted CEO Chris Viehbacher said on a call with analysts Tuesday.

In a bid to rectify the situation, Biogen has debuted a program dubbed Fit to Growth, which aims to align operations with expected revenue while leaving cash on hand for upcoming launches.

Those product debuts include Leqembi, plus tofersen in amyotrophic lateral sclerosis (ALS) and zuranalone in major depressive disorder and postpartum depression.

Hours after Biogen's first-quarter earnings conference call Tuesday, the company won FDA accelerated approval for tofersen, which now carries the commercial moniker Qalsody.

Meanwhile, Biogen and its partner Eisai are poised to get a second bite at the Alzheimer’s disease apple with Leqembi, though coverage of the med is currently stymied thanks to the troubled legacy of its predecessor Aduhelm. By the company’s second-quarter earnings call, Biogen expects “to be in a different place on Leqembi,” he added.

Biogen’s neurology troubles aren’t limited to Alzheimer’s disease, however.

The company missed Wall Street's product sales expectations by $100 million driven in large part by “weakness across the [multiple sclerosis] franchise," Mizuho Securities analysts wrote in a note to clients. The analysts noted that the first quarter of the year “can be weak in MS,” though Biogen’s sales haul in the field was “a bit weaker than expected.”

That said, it wasn’t all bad news for the company, which beat Wall Street's overall revenue estimates for the quarter by about $100 million. This was “entirely driven” by a roughly $200 million beat in contract manufacturing, plus royalties and other revenue, the Mizuho team explained.

Editor's note: This story was corrected to reflect the accurate reasoning behind Biogen's negative Alzheimer's disease sales.