Biogen Plays Deal Maker

Motley Fool Stock Advisor pick Biogen Idec (Nasdaq: BIIB) isn't letting the "for sale" signs it has put up get in the way of continuing its drug development activities. Last week it announced a collaboration deal with small, privately held, Swiss-based Neurimmune Therapeutics.

The deal -- worth up to $380 million in milestone and upfront payments -- that Biogen inked with Neurimmune is a discovery stage collaboration agreement over potential Alzheimer's disease drug candidates.

The agreement gives Biogen marketing and clinical stage development control over Alzheimer's disease antibodies targeting amyloid beta that Neurimmune discovers. Amyloid beta plaques have been found in the brains of Alzheimer's patients and it is theorized that reducing or preventing the buildup will help to at least prevent the disease's progression.

If this Alzheimer's disease target sounds familiar, it's because it is the same one that Elan (NYSE: ELN) and partner Wyeth (NYSE: WYE) are testing their drug candidate, AAB-001, against.

The duo announced earlier this year that they would begin phase 3 trials of AAB-001, and data from a moderately sized 240-person phase 2 study is expected in 2008. The phase 2 results should give insight into how good a choice amyloid beta is as a drug target in humans.

The average drug takes 12 years to get from the lab through FDA approval, if it even makes it that far. Therefore, since the new deal doesn't give Biogen access to any clinical stage drug candidates, it will be many years before the possible fruits of this collaboration may develop.

Nonetheless, this deal with Neurimmune demonstrates that Biogen's leadership isn't letting the distraction of putting itself up for sale get too much in the way of everyday business. That should be some comfort to shareholders in case no buyer ponies up the cash to acquire the company.