By Fineline Cube US-based biopharmaceutical company Biogen (NASDAQ: BIIB) has released its financial report for the second quarter of 2023, which shows the firm continuing to face challenges due to the underwhelming market entry of its Alzheimer’s therapy, Aduhelm (aducanumab). In response, Biogen announced plans to make 1,000 job cuts as part of a “Fit for Growth” program, aimed at generating approximately USD 1 billion in annualized savings on operating expenses, with USD 300 million of those savings allocated to R&D and other savings initiatives.
Aduhelm’s Impact on Biogen’s Performance
Biogen has been struggling since Aduhelm received accelerated approval in the United States in June 2021. The drug failed to generate significant returns as the Center for Medicare & Medicaid Services (CMS) refused to expand reimbursement beyond patients participating in a post-market clinical trial. Despite having two Alzheimer’s products on the market, including Leqembi (lecanemab), which gained full approval and CMS coverage in July 2023, Biogen’s financial performance has been affected.
Q2 2023 Revenues and Product Performance
In Q2 2023, Biogen’s revenues reached USD 2.5 billion, a 3% decrease year-on-year in constant currency terms. Aduhelm/Leqembi sales contributed a negative USD 20 million due to related costs. The multiple sclerosis (MS) portfolio saw sales decline by 14% year-on-year, primarily due to Tecfidera’s performance in the US. However, Tecfidera benefited from an extension of market protection in the EU until 2025. Spinraza (nusinersen), a drug for spinal muscular atrophy, generated USD 437.1 million, marking a 5% year-on-year increase.
CEO’s Outlook on Leqembi and the ‘Fit for Growth’ Program
During the earnings conference call, CEO Christopher Viehbacher expressed optimism about Leqembi’s ongoing launch, highlighting it as the first disease-modifying treatment for Alzheimer’s disease to receive full FDA approval and CMS reimbursement. However, he also noted the unpredictability surrounding Leqembi’s market progress, given Aduhelm’s failed launch. The company is focusing on educating physicians and identifying appropriate patients for the drug. Aduhelm and Leqembi are expected to generate negative revenues in 2023 due to commercialization costs. Leqembi’s list price is set at USD 26,500 for a year of treatment, compared to Aduhelm’s initial launch price of USD 56,000, which was later reduced to USD 28,000. Medicare patients can expect to pay around USD 5,000 per year out-of-pocket for Leqembi.
Viehbacher described the “Fit for Growth” program as a comprehensive redesign of the company, addressing historically high operating expenses and over-investment in legacy products. The staff layoffs are affecting both R&D and sales departments, with significant reductions already implemented in R&D.-Fineline Info & Tech