Biogen’s Rough Week Adds to Alzheimer’s Drug Issues as Shares Fall

(Bloomberg) -- Biogen Inc.’s rough five-month stretch that has wiped out $25 billion took another hit this week as Wall Street grappled with the company’s challenging path forward.

The surprise retirement of Biogen’s top scientific executive, Al Sandrock, and a signal that Europe’s medicines regulator may be reluctant to clear its Alzheimer’s disease drug sent shares to the lowest level in eight months. 

Biogen shares have dropped as much as 7.3% over two days as analysts debated the outlook for one of the oldest U.S. biotechnology companies amid concerns around its hotly-debated Alzheimer’s disease drug and competitive issues for its broader drug portfolio. It feels like Biogen’s “footing remains pretty shaky,” wrote Wedbush analyst Laura Chico.

The stock has spiraled 38% since closing at a six-year high after the landmark approval of its Alzheimer’s drug, Aduhelm. While shares have been bloodied, Wall Street analysts remain mixed on the company’s prospects with 18 rating the stock a buy and 13 advising clients to hold. The average analyst price target of $361 implies a more than 40% return from current levels.

The analyst most optimistic about the company, Truist’s Robyn Karnauskas, said that shares could rally if Biogen’s move to overturn Mylan’s Tecfidera patent victory plays out. 

Piper Sandler analyst Christopher Raymond stuck with his overweight rating and said that despite the week where “the hits just keep on coming,” neurologists still project solid uptake of Aduhelm. Next year’s Medicare coverage determination for the drug is likely to serve as a catalyst, he continued.

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