Will These Biotech Stocks Bring Clarity For Alzheimer’s Patients?


    Big pharma has felt the pressure for years to develop a drug that will halt the progression of Alzheimer’s disease. This is an incredibly debilitating neurological ailment that begins with memory loss and eventually suppresses patients of brain function. This can quickly lead to dementia and death.

    Therefore the success of such a drug therapy to combat or even cure the effects of Alzheimer’s would have a profound societal impact and help to contain the cost of an ever-growing population of Alzheimer’s patients; the number is estimated to be in the ball-park of 5 million in the U.S. and 26 million worldwide.

    Several companies have begun to tackle this tall order of drug development and phase trials to hopefully bring to market a therapy that shows promise. In fact some think that a successful treatment/treatments for Alzheimer’s could generate $10 billion to $20 billion in annual revenue. Companies that are focusing their efforts on this segment include Eli Lilly (LLY), Pfizer (PFE), Elan (ELN), Johnson & Johnson (JNJ), and Biogen Idec (BIIC).

    From an outside perspective these companies’ drugs may appear the same and of course, they are in the fact that they all work to combat the effects of Alzheimer’s Disease but that’s where the similarities stop. Results from pivotal trials on solanezumab, developed by ILLY, and bapineuzumab, developed by PFE, ELN and JNJ, are expected in the third quarter of this year. If either drug works and clears the FDA, it could be a matter of months until it hits the market. Tim Anderson, a pharmaceutical analyst for Bernstein Research, stated, “If these Alzheimer’s drugs hit it big, they could become the next Lipitor.” Anderson pegs the chance of success for the Lilly drug at 20%, saying that solanezumab is a “lottery ticket” with a huge potential payoff. Bapineuzumab has a better shot, though most analysts view its odds at less than 50%.

    Analysts are estimating that Lilly and Elan may have 10% downside if the drugs fail and upside of 50% or more if they score. Success for bapineuzumab could trigger an attempt by J&J to buy out Elan’s 25% stake in the drug, or purchase the entire company.

    An experimental drug for Alzheimer’s disease sharply slowed the decline in mental function in a small clinical trial, as reported by researchers earlier in March. The drug is being developed by Biogen Idec and could achieve sales of billions of dollars a year if the results from the small trial are replicated in larger trials that BIIC says it hopes to begin this year. The drug is called aducanumab. It met and in several cases greatly exceeded Wall St. expectations in terms of how much the highest dose slowed “cognitive decline”. However, there was a high incidence of a particular side effect that might make it difficult to use the highest dose.

    Federal funding for Alzheimer’s research is about $600 million, which the Alzheimer’s Association considers “inadequate”. Last year, a blue-ribbon panel of scientists recommended to the U.S. Department of Health and Human Services that the figure be raised to at least $2 billion per year. With so much anticipation, it’s no surprise that more emphasis is being placed on finding a cure or at least a viable therapy for that matter. Will it be in 2015?



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