Biogen's (NASDAQ: BIIB) stock soared by more than 40% following the U.S. Food and Drug Administration's (FDA) approval of its Alzheimer's Treatment which is designed to slow cognitive decline. However, the decision was met by considerable skepticism by many who question the drug's effectiveness and its cost. One FDA panel member resigned his seat in protest of the decision.
This is the first approval for an Alzheimer's Treatment in two decades and had been eagerly awaited given the huge number of people affected by the disease. While most existing drugs treat the symptoms of Alzheimer's, Biogen's Aduhelm works by reducing clumps of a toxic protein that many see as one of the causes of the diseases. Others see it as simply a marker of the disease.
Importantly, Biogen's drug doesn't cure or reverse the disease's progression, instead, it treats a marker of the disease. The drug is expected to be priced at around $50,000 per patient which would be a huge windfall for the company.
However, there's a lot of controversy around the decision as the drug had been rejected by the FDA two years ago. Another panel of independent experts also objected to its approval in November. They concluded that the clinical data showed no evidence that the treatment had benefits for patients.
The FDA decision focused its approval process on Aduhelm's efficacy to clear the toxic proteins. However, Biogen will be required to complete a larger clinical trial showing that the clearing of these proteins has a positive effect on cognition. If it fails to do so, then it's possible that the treatment could be rejected.
This is different than the FDA's typical approval process, however, this is being attributed to the decades of no meaningful drug development for Alzheimer's and the desperate need for some sort of treatment.
The decision has split the medical community, however, it's being interpreted by many in the public as a meaningful breakthrough that could increase if Biogen is allowed to market the drug. Therefore, doctors will have a tough task in prescribing the drug but keeping realistic expectations.
An indication of the vociferous debate around the drug is that a member of the FDA's advisory panel, Dr. Aaron Kesselheim, resigned his seat in protest of the decision. According to his resignation letter, he said it "was probably the worst drug approval decision in recent U.S. history."