Eisai Plunges After Alzheimer Drug Fails to Win Japan Backing
Eisai Plunges After Alzheimer Drug Fails to Win Japan Backing
(Bloomberg) -- Eisai Co. saw its shares tumble to the lowest level in nearly two years after its controversial treatment for Alzheimer’s disease failed to win backing from Japan’s ministry panel on Wednesday.
Shares of Eisai dropped as much as 9.2% in Tokyo morning trading, the biggest fall since July and reaching a level last seen in early 2020, while the benchmark Topix gained 0.4%. Its American partner for the drug, Biogen Inc., was little changed at $234.48 in Nasdaq trading on Wednesday.
The committee of experts of Japan’s health ministry said on Wednesday after markets in Tokyo closed that it will be difficult to back the drug, called Aduhelm in the U.S., and they will need to reassess it based on additional trial data, after European Union’s drug regulator rejected the medicine last week.
The panel said the results from the two trials filed were inconsistent, while the clinical impact of lowering amyloid beta -- the main component of the plaques found in the brains of people with Alzheimer’s disease -- wasn’t established. Swelling and bleeding in the brain was also seen after the administration of the drug.
“It’s difficult to clearly judge the efficacy of the drug from the data obtained,” the panel said, according to a statement from Japan’s health ministry. “It’s necessary to re-examine the efficacy and safety of the drug based on the results of trials with appropriate design to be conducted in future.”
Following the decision, Eisai and Biogen said it’s committed to bringing the treatment to patients in Japan in a statement on Wednesday.
High Cost
The medicine won U.S. approval in June and became the first new treatment for Alzheimer’s disease in almost 20 years. Yet, the drug has faced skepticism from medical professionals who aren’t certain of its efficacy, with some members of the outside committee that advised regulators resigning in protest.
Even so, patient groups have cheered the arrival of Aduhelm, the first therapy that aims to alter the course of the disease. At the same time, its high cost has been a concern, which has forced Biogen to recently halve the list price of the drug to $28,200, just months after launch.
The European Medicines Agency rejected the drug on Dec. 16, dimming Aduhelm’s prospects in the region. The agency reviewed studies of the medicine and recommended that the European Commission refuse its marketing application. While the opinion can be appealed, the European Commission makes its decision based on the EMA’s recommendation and typically follows its advice.
The agency said that while it reduces amyloid beta, the link between that and clinical improvement hasn’t been proven. The panel also said the studies didn’t show the drug was safe enough, as some brain scans of patients suggested abnormal swelling or bleeding.
‘Negative Trend’
The two companies said they will ask the agency to re-examine the opinion, a process that takes about two months upon receipt of the necessary documents. The EMA’s review committee had given “a negative trend vote” on the U.S. drugmaker’s application for Aduhelm last month, signaling a likely rejection.
Such a move “effectively wipes away 40% of potential future revenue,” Brian Abraham and other analysts at REC Capital Markets wrote in a note to clients at the time.
Biogen and Eisai said last week they plan to start another study of Aduhelm in May, with a goal of confirming its benefits in about four years. The U.S. Food and Drug Administration required the trial as part of its approval for the medicine.
Biogen shares, which jumped more than 50% following the U.S. approval in June, have plunged and are trading below level prior to the drug’s authorization. While Eisai’s stock jumped 48% in June, its has given up those gains.
©2021 Bloomberg L.P.