The US company Biogen is under pressure after the debacle at the launch of its first Alzheimer’s drug. Thanks to a promising second product, he has the chance for a fresh start, also in his huge factory in Luterbach.
Biogen has spent around 1.5 billion Swiss francs on the new plant in Luterbach. However, it is still not sufficiently utilized.
The largest and most expensive biotech factory in Switzerland is in Luterbach near Solothurn, but the around 500 employees still lack the volume. The US biotechnology group Biogen, which had the huge plant built for 1.5 billion Swiss francs, was forced to write off 12 million dollars in the past third quarter – because of unused capacity.
When asked, the company did not want to comment on where exactly the value adjustment was made. “We cannot say anything about this,” said a spokesman. In market circles, however, it is an open secret that the plant has not been sufficiently utilized to date.
Only meager sales
The factory was originally intended to produce the new Alzheimer’s drug Aduhelm on a large scale. At the time of the US approval announcement in early June 2021, Biogen said it was looking to add 80 employees to the more than 500 it already had.
Almost a year and a half later, the group has to put up with the accusation of having caused what is probably the biggest flop of all pharmaceutical companies to date in the launch of a new drug. In the first nine months of this year, sales from the marketing of Aduhelm were limited to a paltry 4.5 million dollars.
Confidence thanks to lecanemab
But despite all these adversities, Biogen has not lost hope of doing big business with the treatment of Alzheimer’s. Since the end of September, positive study data from the development of a new potential drug against dementia, lecanemab, have provided renewed confidence.
Although the detailed data are still pending (they are to be presented to the experts at a congress at the end of November), Biogen seems to be counting on receiving approval for this product as well. The decision of the US health authority FDA is expected in January.
And Lecanemab is also to be manufactured in Luterbach. Biogen has signed a ten-year contract with its Japanese partner Eisai for the production of the active ingredient. However, it seems that this time calculations are being made more cautiously. The personnel planning is “completed on a large scale,” explains the spokesman for Biogen. In other words: The existing team has to last until further notice.
How are the doctors and payers reacting?
In any case, it is still unclear whether Biogen will succeed in the second attempt, which failed colossally the first time. The phase 3 study on lecanemab showed that mental deterioration could be slowed down by 27 percent during 18 months of treatment with the drug. But opinions differ as to whether this will suffice for a prescription.
It also remains to be seen whether the Medicare health insurance, which is available to all residents of the USA over the age of 65 and is therefore decisive for the vast majority of people affected by Alzheimer’s in the country, will handle reimbursement less restrictively than at Aduhelm. Last April, she decided to reimburse the costs of treatment with Aduhelm only to those patients who take part in a follow-up clinical study. Very few treating physicians want to take on this effort together with the patients and their relatives.
Also Roche and Eli Lilly in the running
In addition, Biogen and Eisai face intense competition. Competitors Roche and Eli Lilly have similar compounds in late-stage development and are expected to present results in late November 2022 and mid-next year, respectively.
Biogen and Eisai had already agreed on a partnership for Aduhelm. Unlike Aduhelm, the Japanese are now in charge. Eisai will set the price for lecanemab, Biogen’s management assured this week at the presentation of the latest quarterly results. In the case of Aduhelm, an outcry from the American public forced the company to halve the price for an annual treatment, originally set at $56,000, to $28,000.
Eisai will also define how exactly lecanemab should be marketed, said outgoing Biogen CEO Michel Vounatsos. The French manager was urged to announce his resignation last May after a good five-year tenure.
High expectations on Wall Street
Biogen no longer has its own capacities for the marketing of lecanemab. The large sales team that the group had built up in connection with Aduhelm was largely disbanded in recent months for cost reasons. This time they want to gradually invest in marketing instead of making advance payments.
It is possible that the hoped-for billions in sales in the business with Alzheimer’s patients will still materialize. Biogen and Eisai have not yet released any forecasts for lecanemab, but Wall Street is talking of peak annual sales of $8 billion. Analysts at the investment bank Goldman Sachs even see the sales up to $14 billion climb.