UPDATE: Biogen shares drop 3% on negative update for Alzheimer's disease drug

Biogen Inc. shares dropped 3% in morning trade Thursday after the company put out a negative update for its Alzheimer's disease drug. An Independent Data Monitoring Committee's 12-month analysis found that the therapy, BAN2401, "did not meet the criteria for success" based on the trial's primary endpoint. The phase 2 trial will continue through 18 months as planned, with a final analysis at the end, which is expected in the second half of next year. Biogen and Eisai Co. have been partners on BAN2401 since 2014, an agreement that included another Alzheimer's disease drug, E2609, which is also still being developed. Last month, the companies expanded the agreement and, as part of it, eliminated milestone payments for BAN2401. BAN2401's phase 2 trial enrolled 856 patients with early Alzheimer's disease. The Independent Data Monitoring Committee's analysis, called a "Bayesian analysis," was used in the hope that "it would enable us to demonstrate clinical success faster than more traditional study designs," said Lynn Kramer, chief clinical and medical officer of the Eisai Neurology Business Group. The companies emphasized that 16 interim analyses that looked at potential for futility did not find it, and that the Bayesian analysis at 12 months found "success was judged at an 80% of higher probability of achieving a Clinically Significant Difference." Despite the company's Thursday share decline, EvercoreISI analyst Umer Raffat said that the trial wasn't well understood and it shouldn't affect company shares much. "Today, all we learned is that the efficacy delta is <38% at mo 12 (and we know from prior interims that efficacy delta has been tracking at >~10%)," Raffat said. "Trial continues to mo 18. This is key." Biogen shares have risen nearly 3% over the last three months, compared with a 7.5% rise in the S&P 500 and a 10.6% rise in the Dow Jones Industrial Average .

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