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Why Biogen's FDA Approval Is Shocking

By Taylor Carmichael – Jun 26, 2021 at 11:00AM

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Many doctors don't like the drug, and the trial data was underwhelming. Nonetheless, Biogen's Alzheimer's drug was approved-- and the market opportunity is huge.

There hasn't been a new Alzheimer's drug in a couple of decades. Earlier this week the Food and Drug Administration (FDA) surprised the stock market when it gave a thumbs-up to Biogen's (BIIB -4.46%) new pharmaceutical, aducanumab, as a treatment for Alzheimer's. The trial data has convinced many doctors that the drug doesn't actually work -- and it has some safety issues as well. Nonetheless, Biogen stands to make billions of dollars off this drug.

What does the future hold for this stock? Corinne Cardina, bureau chief of Healthcare and Cannabis for the Motley Fool, and writer Taylor Carmichael discuss Biogen. This Fool Live segment was recorded on June 18.

Corinne Cardina: Some long anticipated news coming out of Biogen. Let's talk about the Alzheimer's drug, what happened with it, why is it surprising to some, frustrating to some. What do you think about the Alzheimer drug news from Biogen?

Taylor Carmichael: I have not been following the story, so I was amazed researching it and just shocked really. I mean, nobody thought this drug was going to be approved. I mean, they had unimpressive phase 3 data. They didn't meet their primary endpoint, they didn't meet their secondary, it was bad data. People were really shocked that this got FDA approval. What the company did, they did a kind of post hoc analysis of the data, some have argued that they cherry picked their data. But working with the FDA, they looked back at the data, they looked back at the studies, then they convinced the FDA to approve the drug. This drug has some safety concerns, they had issues with, I think it was brain bleed in some Alzheimer patients, and they also had efficacy concerns, that some people think it just doesn't work. It's not a cure for Alzheimer's.

Corinne Cardina: It delays the progression or allegedly delays the progression. The drug name is called aducanumab. The brand name is called Aduhelm, which isn't that much better to say. [laughs] But basically, their advisory committee voted, I think, it was December. Everyone on the FDA's advisory committee gave it a thumbs-down. The FDA actually ended up approving the drug, so some people have quit the advisory committee in protest for the FDA basically going against them. We're not really sure if doctors are going to end up prescribing this to Alzheimer patients, that has yet to be seen. Obviously, it was just approved.

Corinne Cardina has no position in any of the stocks mentioned. Taylor Carmichael has no position in any of the stocks mentioned. The Motley Fool recommends Biogen. The Motley Fool has a disclosure policy.

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