Investors flocked back to Biogen last week after the drugmaker said its potential Alzheimer’s treatment may have new life. But many on Wall Street preach caution. Company shares had plunged in March after Biogen stopped two studies of a drug called aducanumab when partial results suggested it was not likely to succeed. But on Oct. 22 Biogen made a surprise announcement that it will seek regulatory approval to sell the drug, and the stock shot up. Biogen said a subsequent data analysis suggested that the drug, when delivered at high doses, helped reduce a decline of thinking skills in patients
with early stage Alzheimer’s. Any drug that treats Alzheimer’s could generate billions in revenue, analysts say. The problem is that it’s far from clear that aducanumab does that effectively enough to get approved. Most analysts who cover the company have kept a “hold” rating on the shares instead of recommending that investors buy. Canaccord Genuity’s Sumant Kulkarni said he needs to see more data, expected to be presented at a medical meeting in early December, before he decides whether to change his recommendation. Kulkarni gives the drug a 20% chance of getting approved.