This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Elan and American Home Hold Steady on Solid Alzheimer's Drug Results

Elan (ELN) found no undue side effects in early-stage human tests of a novel Alzheimer's disease vaccine, but investors reacted in muted fashion and analysts said it's too early to predict whether the drug will succeed.

Elan's vaccine, called AN-1792, under development with American Home Products (AHP - Get Report), caused a stir last July when results of a trial in mice were published in Nature, the science journal. Data showed that Elan's compound seemed to help clear troublesome proteins known as amyloid plaques from the brains of mice that had been genetically altered to develop symptoms of Alzheimer's.

Some scientists think plaque deposits in the brain clog nerve signal transmission, causing the disorientation and forgetfulness that is common in Alzheimer's patients. But no one is certain what causes the brain-deteriorating disorder, which afflicts some 15 million people worldwide.

Elan reported the results of clinical tests at the World Alzheimer's Congress 2000 in Washington Tuesday. Its stock slipped 1, or 1.9%, to 50 15/16 in heavy trading, while American Home shares added 1, or 1.6%, to 59 5/8.

Analysts say the high failure rate of drugs in clinical trials, particularly for Alzheimer's, precludes sales forecasts for now. But most agree that an effective treatment for Alzheimer's could quickly become a top-seller, particularly as the 47 million baby boomers develop age-related disorders and demand new drugs.

"We don't pay attention to phase one or two trial data," says Scott Shevick, analyst with American Home underwriter Bear Stearns. "History says that no one, not companies or analysts, calls new drugs correctly." In agreement is Neil Sweig, an analyst with Ryan Beck, which hasn't underwritten for either company: "I have no interest in phase one data, due to the high failure rate." Shevick has a buy on AHP and Sweig a neutral rating, but neither analyst follows Elan.

Alzheimer's is proving to be one of the most difficult areas of medical research, although that hasn't stopped drug companies from pouring millions of dollars into finding new drugs for the disease.

In the past year, Aventis (AVE) and Bayer both suffered high-profile failures of Alzheimer's drugs in late-stage clinical trials. And Warner-Lambert's Cognex, introduced in 1993 as the first of a new class of Alzheimer's drugs, has been overtaken by Pfizer's (PFE) Aricept, now the dominant treatment, although Novartis' (NVS) Exelon, introduced in May, is rapidly gaining market share. Warner-Lambert is now part of Pfizer.

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
ELN $0.00 0.00%
AHP $11.19 0.00%
AAPL $93.74 0.00%
FB $117.58 0.00%
GOOG $693.01 0.00%


Chart of I:DJI
DOW 17,773.64 -57.12 -0.32%
S&P 500 2,065.30 -10.51 -0.51%
NASDAQ 4,775.3580 -29.9330 -0.62%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs