Biogen has been weighing what to do with its hemophilia drugs, which don’t fit in with the rest of its portfolio. And now, it’s come up with an answer.
The Big Biotech will spin off its hemophilia business as a publicly traded company, it said Tuesday--a move that will help it focus on its neurodegenerative portfolio. While it considered other alternatives--such as selling off the division--a spinoff will yield the most value for shareholders, it figures.
Investors should have shares of the so-far-unnamed new company--to be helmed by John Cox, Biogen’s current EVP of pharma operations and technology, and based in the Boston area--in hand by the end of 2016 or early 2017, Biogen said on a conference call.
The way the Massachusetts drugmaker sees it, spinning off its hemophilia assets will result in two profitable companies that can “respond more quickly to the rapidly changing developments and global opportunities in their respective patient markets”--a factor that’s especially important in the hemophilia space, where next-gen competition and new approaches to treatment are quickly rising through the pipelines of multiple players. And jettisoning those products--including long-acting newcomers Eloctate and Alprolix, which generated combined revenues of $640 million during the 12 months ended March 31, 2016--will free it up to buckle down on development areas such as multiple sclerosis, Alzheimer’s disease and Parkinson’s disease.
The spinoff won’t be the only major change Biogen has enacted recently. In October, it embarked on a large-scale restructuring effort with the aim of pare down costs and throwing more money behind Tecfidera, a multiple sclerosis pill whose growth trajectory had slowed since the beginning of its red-hot launch. As of Q1, those initiatives seemed to be paying off, with EPS trouncing forecasts and R&D and SG&A costs coming in well below consensus estimates.
The company still has plenty on its plate, though. Two of its key meds--Tecfidera and fellow MS therapy Tysabri--are currently facing IP challenges that could put billions in sales at risk.
- read Biogen's release
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