Shares of Biogen and Ionis Pharmaceuticals soared Monday after an interim analysis of late-stage data showed their drug for a deadly muscle disorder in infants met its main goal.
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Babies with spinal muscular atrophy who got the experimental drug, nusinersen, achieved motor-skills development milestones better than those who didn’t get the treatment, the companies said in a statement.
“This is a upside surprise, as investors did not have high confidence the drug would work (Biogen’s pipeline is viewed as high risk/high reward), let alone at the interim analysis where the hurdle is even higher to stop”, wrote RBC Capital Markets analyst Michael Yee in a research note.
Shares of Biogen, which plans to file marketing applications for the potential blockbuster in the coming months, rose about 5.2 percent to $304.95. During the trial, Nusinersen illustrated an acceptable safety profile.
In exercising its option to take over the Nusinersen program, Biogen will pay $75 million to Ionis, the Carlsbad, Calif., company formerly known as Isis Pharmaceuticals Inc. The company added that the Phase 3 study assessed nusinersen in infantile-onset (consistent with Type 1) SMA.
Nusinersen is also being evaluated in two other studies in different SMA patient groups that will continue as planned.
Ionis is eligible to receive tiered royalties on any potential sales of nusineren up to a percentage in the mid-teens, in addition to up to $150 million in milestone payments based on regulatory approvals. We look forward to working with Biogen on completing the clinical program and preparing for what we hope is a positive regulatory review.
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Ionis’ stock has plummeted so far in 2016, falling more than 52 percent.
