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Biogen Loses Big MS Gamble As Anti-LINGO Fails Clinical Trial
Biogen is back to the drawing board with its potentially revolutionary MS drug candidate. (iStockphoto)
AMY REEVES6/07/2016
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Biogen (BIIB) said Tuesday that its risky but potentially transformative multiple-sclerosis drug candidate had failed its clinical trial, driving the big biotech's stock down sharply on Tuesday.
Biogen said that its drug opicinumab, better known by its medical acronym anti-LINGO, hadn't met either the primary or secondary endpoints in its mid-stage trial, which measured improvements in physical and cognitive functions as well as disability and disease progression. Biogen nonetheless said that "evidence of a clinical effect with a complex, unexpected dose-response was observed," so it was analyzing the results in hopes of designing another study.
Anti-LINGO is a novel technology that promised to be the first to rebuild myelin -- the fatty layer around the nerve cells that erodes in MS patients -- and thereby actually reverse the progression of the disease. Results last year of an earlier trial of optic neuritis -- a form of vision loss in MS patients associated with demyelination -- were technically positive but ambiguous enough that expectations were low going into the MS results.
"This was one of the most unknown, unpredictable major clinical events investors were trying to do work on," wrote RBC Capital Markets analyst Michael Yee in a research note. "It also reflects the challenging dynamic with the stock for many growth investors in that it is seen as a 'high risk, high reward' pipeline company, and it's hard to get conviction on the events without data despite lots of potential upside if it works."
Biogen's other high-risk, high-reward program is in Alzheimer's disease, which was very promising in earlier trials but is in a disease area with a long history of failure. The next batch of data on that isn't expected for more than a year, though an expected Eli Lilly (LLY) report on its own Alzheimer's drug late this year could provide some read-across, analysts say.
Biogen shares tumbled 12.8% to 252.86 on the stock market today. The stock gapped below its 200-day and 50-day moving averages.
AMY REEVES | Facebook | @IBD_Areeves
