May 3 (Reuters) - Biogen Inc said on Tuesday that
chief executive Michel Vounatsos will step down and that the
company is pulling back on selling its controversial Alzheimer's
drug Aduhelm, in what appears to be a final blow to its prospect
of becoming a big seller.
The future of Aduhelm has been in doubt since the U.S.
government's Medicare program restricted coverage of the
medicine to patients in clinical trials.
Aduhelm was expected to be the company's next big
blockbuster treatment, but controversy over its approval without
clear evidence of patient benefit and the U.S. decision to
severely limit access cast serious doubt on its sales potential.
Biogen said on Tuesday https://bit.ly/3LHu8vF it was looking
at "substantially" eliminating commercial infrastructure related
to Aduhelm and plans for more cost cuts, in addition to the
current program to save $500 million annually.
Biogen last month decided to withdraw its marketing
application for Aduhelm in Europe after failing to convince the
European regulator of the treatment's benefits.
The company said it will retain minimal resources to make
Aduhelm available to patients currently taking the drug in the
Vounatsos, who was named as the CEO in 2016, will continue
in his role until a successor is appointed, the company said.
Under his leadership, the U.S. biotech developed and launched
several important growth drivers including spinal muscular
atrophy drug Spinraza and multiple sclerosis drug Vumerity.
"The news (about Vounatsos) is not surprising, given the
many setbacks the company has faced," said RBC Capital Markets
analyst Brian Abrahams, adding that it "may help add to the
perception that Biogen will turn the page from being overly
levered to Alzheimer's to assembling a more diverse pipeline."
Biogen shares were up about 1.3% at $210.03 on Tuesday. The
stock is down 47% since Aduhelm was approved in June.
The company was betting on Aduhelm, the first new treatment
for the memory-robbing disease in nearly 20 years, to act as a
buffer as its main established revenue drivers face rising
The U.S. Food and Drug Administration approved the treatment
last June despite a lack of clear evidence that it slowed
cognitive decline and over objections of the agency's panel of
outside expert advisers.
Aduhelm had sales of just $2.8 million in the first quarter,
missing analysts' diminished estimates. The company said its
earnings were hit by a $275 million Aduhelm inventory write-off.
Excluding items, Biogen earned $4.38 per share, in line with
Vounatsos called the setbacks faced by the company in the
last 12 months "significant," but said Biogen remained committed
to Alzheimers disease.
Biogen is still counting on a second Alzheimer's drug,
lecanemab which, like Aduhelm, was developed with Japanese
company Eisai Co. Ltd.
Biogen plans to complete a rolling submission of data for
lecanemab under the U.S. accelerated approval pathway in the
current quarter before submitting it for full approval in 2023.
On Tuesday, Eisai revised down its operating profit forecast
for the year ended March 31 by 31.4% to 53.5 billion yen ($411
million), citing the impact of the U.S. coverage policy for
($1 = 130.1300 yen)
(Reporting by Leroy Leo and Mrinalika Roy in Bengaluru;
Additional reporting by Makiko Yamazaki in Tokyo; Editing by
Shounak Dasgupta and Bill Berkrot)