Biogen, Elan Fall on Brain Infection Fears

NEW YORK -- Shares of Biogen Idec(BIIB Quote) fell Friday as European regulators investigate reports of 23 cases of Tysabri patients with a potentially fatal brain infection.

The stock fell $2.54, or 5.4%, to $44.69 in midday trading. Shares have traded between $37.21 and $55.34 over the past 52 weeks. American depository shares of Biogen's partner, Elan(ELN Quote), fell $1.26, or 19.6%, to $5.17.

The multiple sclerosis drug was pulled from the market in 2005 due to concerns about the condition, called progressive multifocal leukoencephalopathy, or PML. Sales resumed in July 2006 with restrictions and a monitoring program. As of July 2009, the company had reported 11 cases of the condition and said it would stop updating reports of additional cases.

Analysts have mainly brushed off ongoing concerns of PML risks, with many saying they have already been priced into the stock. Still, some do not expect sales of the drug at the same levels they were before the PML issues.

"PML rates are exactly as we predicted in July," said Leerink Swann analyst Dr. Joshua Schimmer, in a note to investors. "If anything, our view of the Cylex assay (safety monitoring) is improving."