On Friday, Piper Sandler maintained its Overweight rating and $325.00 price target on shares of Biogen (NASDAQ:BIIB), following news that the U.S. Food and Drug Administration (FDA) has decided to convene an Advisory Committee (AdCom) to review competitor Eli Lilly (NYSE:LLY)'s donanemab and has delayed its regulatory approval decision.
The news is seen as positive for Biogen, as their product Leqembi could benefit from the delayed entry of a competing Alzheimer's disease therapy.
The FDA's decision to take a closer look at donanemab comes after concerns were raised regarding its long-term safety and notably higher rates of Amyloid-Related Imaging Abnormalities (ARIA), an adverse effect associated with Alzheimer's treatments that target amyloid plaques. In contrast, Leqembi, Biogen's therapy, has demonstrated a safety advantage in this area.
According to Piper Sandler, the commercial success of revolutionary Alzheimer's treatments like Leqembi could be enhanced by having additional advocacy for amyloid-targeting therapies. This is particularly relevant given Leqembi's marked safety advantage over donanemab. Despite the FDA's concerns with donanemab, Piper Sandler anticipates its eventual approval.
The firm continues to project worldwide end-user revenue for Leqembi at $352 million for the fiscal year 2024 and $1,395 million for the fiscal year 2025. This outlook is based on the drug's efficacy and safety profile, which is expected to play a significant role in its commercial performance in the competitive Alzheimer's disease treatment market.
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