Friday, October 31, 2008

Biogen, Elan shares fall as third Tysabri patient suffers brain infection

30 October 2008

Biogen Idec and partner Elan Corp have suffered a slide in their respective share prices after a new case of progressive multifocal leukoencephalopathy in a multiple sclerosis patient being treated with Tysabri, was disclosed.

In a filing to the US Securities and Exchange Commission, Biogen said that the relevant regulatory agencies had been notified of a confirmed case of PML, a potentially deadly brain infection, in a patient suffering from MS in the USA who had been on Tysabri (natalizumab). The disclosure comes after Biogen and Elan reported in July that two cases of PML had emerged in Europe.

In the latest case, the filing reveals that the patient received 14 injections of Tysabri. The patient has a history of prior disease-modifying therapies including beta-interferons and Texa’s Copaxone (glatiramer acetate) and he/she had also been treated with methotrexate for a rheumatology condition. The individual is now under the care of their treating physician, Biogen said.

PML has played a major part in the history of Tysabri. These recent cases are the first to be recorded since the reintroduction of natalizumab in the USA and approval in Europe two years ago. Biogen and Elan had voluntarily withdrawn the drug a year earlier after three patients developed the brain infection.

Since reintroduction, sales of Tysabri have soared – by the end of September there were 35,500 patients using the drug worldwide and in the third quarter of this year, 3,700 new patients were added. It has also now available in the USA as a treatment for Crohn's disease and Biogen and Elan expect that 100,000 MS patients will be taking the drug by 2010.
Biogen and Elan have a strict monitoring programme in place for the therapy and the reintroduction of Tysabri was based in part on the number of PML cases not exceeding the level acceptable to the US Food and Drug Administration (one in every 1,000). As only three cases have been reported, the treatment is well within that limit but the news has certainly spooked investors.

In after-hours trading last night, Biogen shares had fallen by as much as 15%, while this morning Elan stock has been hit. At 9.40 UK time, the Irish firm’s shares were down 18% to 4.80 euros.

Ian Hunter, an analyst at Goodbodys in Dublin, has issued a research note this morning saying “we believe that this new case should do little to projected numbers of patients on Tysabri, given that the considerable pull back in momentum after the first two cases…will have accounted for the majority of those patients and physicians wary enough of the PML risk” to consider not taking or prescribing the drug. However, the fact that this patient was on the drug for 13 months and the other two were on it for 14 and 17 months “may suggest that there is a timing issue and that it takes over a year on Tysabri for the interaction between drug and patient to lead to the development of PML”.

By Kevin Grogan