What Happened?
Shares of biotech company Biogen (NASDAQ: BIIB) jumped 5.6% in the afternoon session after investors continued to cheer a string of growth signals, including the $1 billion purchase of RayThera Inc., an FDA Breakthrough Therapy tag for its drug candidate Salanersen, and a recent analyst upgrade.
The acquisition of RayThera is set to bolster Biogen's immunology pipeline. The positive sentiment was further supported by the U.S. Food and Drug Administration's 'Breakthrough Therapy' designation for Salanersen, a treatment for spinal muscular atrophy. This news, combined with a recent upgrade to 'Buy' from investment firm Needham and a strong first-quarter earnings beat, reinforced investor confidence. Additionally, Biogen is integrating its multi-billion dollar purchase of Apellis by halting some research programs to focus on its key marketed drugs, Empaveli and Syfovre, demonstrating a clear strategy to prioritize high-value assets.
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What Is The Market Telling Us
Biogen’s shares are not very volatile and have only had 6 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 10 months ago when the stock gained 4.8% on the news that the company and its partner Eisai received FDA approval for a weekly subcutaneous injection of their Alzheimer's drug, Leqembi, for maintenance dosing.
The new, more convenient formulation, which will be marketed as Leqembi Iqlik, allows for at-home administration for patients who have been on the drug for 18 months. This provides an alternative to the previous hour-long intravenous infusions. Adding to the positive momentum, Biogen, along with partner Stoke Therapeutics, presented promising data for zorevunersen at the 36th International Epilepsy Congress. The data showed durable seizure reductions in patients with Dravet syndrome, a severe form of epilepsy, supporting the drug's potential as a first-in-class disease-modifying treatment.
Biogen is up 19.7% since the beginning of the year, and at $212.80 per share, it has set a new 52-week high. Despite the year-to-date gain, investors who bought $1,000 worth of Biogen’s shares 5 years ago would now be looking at only $625.39.
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