Correction: The date of the aducanumab presentation is July 22, not July 18 as previously stated.

CAMBRIDGE, Mass. (TheStreet) -- Get ready for Act 2 of Biogen (BIIB - Get Report): The Alzheimer's Story.

On Wednesday, July 22, Biogen will present updated results from a closely watched clinical trial involving its Alzheimer's drug candidate aducanumab (formerly known as BIIB037.) Investors first saw aducanumab data from this study in March. The results were both spectacular and controversial.

Treatment with aducanumab led to a statistically significant improvement in cognition compared to placebo in patients with mild Alzheimer's. A large number of aducanumab-treated patients also experienced potentially worrisome brain swelling. The early-stage study only enrolled a small number of Alzheimer's patients, which means the drug's benefit might not hold up when a larger study is conducted. [The graveyard of Alzheimer's drug research is filled with drugs which looked great early but blew up late.]

Overall, investors cheered the March aducanumab results because they buoyed hopes that an amyloid plaque-busting Alzheimer's drug might finally work after years of failures. For Biogen, aducanumab has the potential to generate billions of dollars in new revenue.

Let's take a look at the two main efficacy slides from the March aducanumab study presentation to better understand 1) the importance of the July 22 update;  and 2) frame investor expectations.

First up is the chart depicting aducanumab's effect on the Clinical Dementia Rating (CDR-sb) scale, a measure of cognition. Pay close attention to the red line representing Alzheimer's patients treated with a 6 mg dose of aducanumab.

The red line (6 mg aducanumab) stops at 26 weeks. On July 22, we'll get more data tracking performance of these patients out to 54 weeks, matching the results we already have for patients treated with 1 mg, 3 mg and 10 mg doses of aducanumab, plus placebo. 

A positive dose response is ideal, so the best outcome for the July 22 update will have the 6 mg dose of aducanumab landing somewhere between the green line (3 mg dose) and the dark blue line (10 mg dose) at 54 weeks. Alarm bells might go off if the 6 mg dose significantly underperforms the 3 mg dose. If the 6 mg dose doesn't beat the 1 mg dose (the light blue line) or even worse, looks like a placebo (the orange line), Biogen is in trouble and the stock will fall. [Sell-side analysts will still come to the defense of Biogen even if the aducanumab update looks bad because that's what they do.]

This next chart tracks aducanumab's effect on the Mini-Mental State Exam, another measure of Alzheimer's-related cognition.

Notice how the red line (6 mg dose) overlaps the orange placebo line up to 24 weeks. That's a big "uh oh." You'd expect the 6 mg dose to behave more like the 3 mg and 10 mg doses, but that was not the case here when these data were presented in March. Like with the CDR, it will be comforting to see patients on the 6 mg dose diverge from placebo on the MMSE scale when we see the 52-week data on July 22. Can the 6 mg dose catch up completely so that its effect on MMSE resembles the 10 mg dose? We'll see soon enough. 

The impressive efficacy of aducanumab demonstrated last March was marred somewhat by safety risks. The incidence of amyloid-related imaging abnormalities (ARIA), a form of brain swelling, was the most frequently reported adverse event in the study. In Alzheimer's patients who carry the AopeE4 gene, which puts them at higher risk for the disease, the rate of ARIA was 43% and 55% for the 3 mg and 10 mg doses of aducanumab, respectively. This led to treatment discontinuation in 10% of patients on the 3 mg dose and 35% of patients on the 10 mg dose. 

Lower ARIA rates are better, so on July 22 investors will be paying attention to the safety of the 6 mg dose of aducanumab to see if its better tolerated than the 10 mg dose. 

Unless the updated results from the 6 mg dose of aducanumab look absolutely awful, don't expect much change in investor sentiment about Biogen and its Alzheimer's program. The company has already started a large, phase III study of aducanumab set to enroll 1,350 prodromal Alzheimer's patients. Results could be ready in the middle of 2018.

Adam Feuerstein writes regularly for TheStreet. In keeping with company editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.