Three is not a lucky number for Biogen Idec
That's the number of cases of progressive multifocal leukoencephalopathy (PML) that have been reported since their multiple sclerosis drug Tysabri made its return. It was put back on the market in 2006, after having been pulled a year earlier over reports of PML in Tysabri patients.
The third case of the often-deadly brain disorder was reported yesterday, but are three cases really that much worse than two? I really don't think so.
Another case was bound to pop up. As more patients use Tysabri, it becomes more likely that cases will be reported -- that's probability at work. The Food and Drug Administration didn't seem all that worried about the two cases reported in July. Other drugs -- like Rituxan, from Genentech
The growth curve for Tysabri sales has already begun to slow as patients switch to other multiple sclerosis drugs -- including Copaxone, from Teva Pharmaceutical's
I think investors are overreacting to the news. As a result, Biogen and Elan are both reaching prices that you just can't resist.