Biogen Higher as Investors Await FDA Decision on Alzheimer's Drug

The FDA is expected to decide on Monday whether to clear Biogen's aducanumab Alzheimer's drug for marketing. The stock is higher.
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Biogen  (BIIB) - Get Report shares rose Friday as investors await the Food and Drug Administration’s decision, expected Monday, on whether to clear the company’s aducanumab Alzheimer's drug.

Analysts are mixed as to whether clearance will be granted. And whichever way the FDA goes, the impact on Biogen’s stock could be huge, they say.

This is “the mother of all binary events,” said J.P. Morgan Chase analyst Cory Kasimov, according to Bloomberg. A rejection could depress Biogen shares to $200, while approval could boost them to $450, he said.

Biogen recently traded at $287.75, up 5.6%. It has climbed 15% in the past six months.

Clearance would make aducanumab the first authorized treatment for the memory-destroying disease, Reuters reports. Alzheimer’s represents the sixth most prevalent cause of death in the U.S.

Biogen partners on the drug with Japan's Eisai ESALY. The FDA’s ruling will also affect other companies working on Alzheimer's cures, including Eli Lilly  (LLY) - Get Report, according to Reuters.

It also could have an impact on other neurological drugs and the pharmaceutical industry as a whole, the news service said.

In January, analysts reacted positively to the FDA’s decision to extend by three months the review period for aducanumab. That “seems like a bullish sign,” said Stifel analyst Paul Matteis.

In February, Biogen forecast weaker-than-expected earnings for 2021, amid mixed prognoses for its drugs. It predicted net income of $17 to $18.50 a share for this year, below the average analyst forecast of $25.09, according to Bloomberg.

It saw revenue at $10.45 billion to $10.75 billion, trailing analysts’ consensus estimate of $11.2 billion.