Shares of Eli Lilly (NYSE: LLY) and Biogen (NASDAQ: BIIB) are both down after the latter's clinical trial of a drug intended to treat Alzheimer's disease failed to have any substantial impact on the progression of the disease.
Lilly had been testing the drug Solanezumab in a clinical trial with the help of Washington University. The trial involved 90 patients, 50 would be issued the drug, while the rest would be issued a placebo. Despite the best hopes of Lilly and Washington University researchers, the drug had no effects and did nothing to slow the progression of Alzheimer's disease.
The failure of the clinical trial does not bode well for Biogen's drug, Aducanumab, which was previously submitted to the FDA for approval. Biogen's own trials had mixed results; notably, late-stage trials had failed to produce positive results. Aducanumab functions similarly to Lilly's Solanezumab, which did not bode well for Biogen when news of the Solanezumab trial's failure. Biogen's stock fell 1.8% during Monday trading likely due to the shaken confidence of investors, who may not be so sure of the FDA's approval after the failure of their contemporary's trial. Lilly suffered a drop of 4.1% during premarket trading, though it recovered somewhat later in the day.
From a business standpoint, the failure of Solanezumab and the potential denial of Aducanumab casts doubt on the ability of Lilly and Biogen to push their Alzheimer's drugs to sell through the FDA. While the development of an Alzheimer's drug is a gamble for investors, considering the obstacles for researchers in understanding the disease, at the very least investors seem to be willing to continue betting on Alzheimer's treatments if Lilly's recovery by the end of trading on Monday is any indication.
From a medical standpoint, the failure may cast doubt on the prevailing theory of treatment that had been the center of the development of Solanezumab and Aducanumab. The working theory for the two drugs is that attacking beta-amyloid plaques in the brain may help slow the progression of the disease, as the plaques are believed to be a key culprit in Alzheimer's disease. While the failure has some investors casting doubt, researchers have stood by the theory. Continuous study has found a recurring pattern in the progression of how the disease progresses, tying amyloid plaques to the progression of the disease. Researchers are keen to continue testing as there are plenty of variables that can be changed that may see the drug become more effective in addressing this pattern, such as adjusting dosages. Additional clinical studies may be a gamble, but it cannot be denied that while trials fail, researchers still gain valuable insight into the mechanics of the disease, and may finally find a way to apply Solanezumab and Aducanumab in a way that finally breaks the pattern of progression.