Biogen shares were up by 5.5% on Jan. 29 after the pharma company announced that the U.S. Food and Drug Administration (FDA) had extended the review period by three months for its drug candidate for Alzheimer’s disease – aducanumab.
Biogen (BIIB) had submitted additional clinical data and analyses in response to an information request from the FDA as part of the ongoing review of the drug. The FDA considered this additional information as a “Major Amendment” that would require more time to review.
Michel Vounatsos, CEO at Biogen, said, “We are committed to working with the FDA as it completes its review of the aducanumab application. We want to thank the FDA for its continued diligence during the review.”
The company had submitted the drug application for aducanumab to the FDA in July of last year and the FDA granted it a “Priority Review” in August. (See Biogen stock analysis on TipRanks)
Analyst reactions to this announcement were mixed. On Jan. 29, Stifel Nicolaus analyst Paul Matteis upgraded the stock to Buy from Hold and raised the price target from $258 to $358.
Meanwhile, Piper Sandler analyst Christopher Raymond reiterated a Hold rating on the stock and kept the price target at $265 on Jan. 29.
Raymond said about the extended review period that it was “unclear if this is bullish or bearish” or whether the FDA is “waiting for new permanent leadership as cover before making such a controversial approval/rejection decision.” He added that the “outcome remains unanalyzable.”
The rest of the Street is in line with Raymond’s outlook with a Hold consensus rating. That’s based on 10 analysts recommending a Buy, 10 analysts suggesting a Hold, and 5 analysts recommending a Sell. The average analyst price target of $296.30 implies a 4.8% upside potential to current levels. Shares have risen by 16.1% in the past month.