Eli Lilly Alzheimer’s Drug Gains FDA Breakthrough Status

Eli Lilly & Co. rose after its experimental drug for Alzheimer’s gained breakthrough status from U.S. regulators, a designation that will speed its consideration for approval.

The Lilly drug now becomes the third to receive the designation based on its ability to attack amyloid, an abnormal protein believed to be involved in the damage Alzheimer’s causes in the brain. Lilly said on Thursday it intends to submit later this year a biologics license application for its therapy, called donanemab, under the accelerated approval pathway.

The Indianapolis-based drugmaker rose 8.7% to $235.97 at 9:35 a.m. in New York trading. Biogen fell 5.1% to $353.06.

Biogen Inc.’s Aduhelm was approved for the treatment of Alzheimer’s on June 7 after gaining breakthrough status in a controversial move by the Food and Drug Administration. Lecanemab, another drug being developed by Biogen and its partner Eisai Co., received the designation Wednesday.

Critics of the Biogen drug’s approval have said that human trials haven’t definitively shown its effectiveness, and that its $56,000 annual price tag is excessive. Still, the FDA’s posture toward Aduhelm has spurred interest in other Alzheimer’s candidates, particularly anti-amyloid agents.

In March, Lilly reported data from a small, mid-stage study showing that donanemab slowed decline by 32% on a composite measure of cognition and function when compared to a placebo. It also completely removed a type of amyloid from the brains of the majority of patients who received it.

Breakthrough therapy status is designed to speed development and review of drugs for serious or life threatening ailments. It doesn’t mean the FDA will approve the drug in question, or that the agency has determined that the experimental medicine represents a breakthrough.

Though the results appeared more straightforward than previous studies, they drew mixed reactions from researchers and bankers alike.

Lilly’s move to seek accelerated approval later this year “is somewhat surprising to us from a timing perspective” said Stifel Financial Corp. analyst Paul Matteis said in a note to investors.

Donanemab’s efficacy data looks good relative to Aduhelm’s and is “less confusing,” according to Matteis. He said he remains unsure as to whether the FDA would be comfortable with the size of the safety data accrued.

Should Lilly’s candidate ultimately be cleared by regulators, it could drive down the price of Aduhelm, Matteis said. Analysts surveyed by Bloomberg currently estimate donanemab’s 2024 sales at $358 million.

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