Latest PML case sets Biogen investors off

Analysts are increasingly skeptical of Biogen Idec, as each weekly Tysabri update turns up another patient with the potentially deadly brain infection PML. As you know, the company announced Friday that a 10th case of progressive multifocal encephalopathy had developed in a patient using its top-selling multiple sclerosis drug. That's the 10th case since Tysabri was reintroduced in 2006, after the first three cases of PML prompted Biogen to pull the drug from the market.

When Tysabri came back to the market under a strict risk-management program, company officials warned that PML was likely to crop up again. Obviously it has, and with each new case the unease seems to mount. Analysts at Deutsche Bank downgraded Biogen stock yesterday as investors started selling off their shares; the stock lost 5.5 percent by day's end.

Because the likelihood of PML appears to increase with treatment time, some neurologists have been giving patients Tysabri "holidays," though Biogen isn't keen on the idea. Meanwhile, the estimated risk of some 1 in 1,000 patients is reasonable for many people, one expert told the Wall Street Journal, because the odds are that MS patients will develop significant disability without the drug.

But whatever the treatment strategies, it's clear that Biogen has had to back off its early hopes of taking Tysabri to blockbuster status. And with its stock price on the wane, it could find itself a takeover target, which would make dissident shareholder Carl Icahn happy. But that's another story.

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