TOKYO -- A pharmaceutical alliance between Japan's Eisai and U.S.-based Biogen has succeeded in developing the world's first therapeutic drug approved for slowing the onset of Alzheimer's disease.
On June 7, the U.S. Food and Drug Administration approved Aducanumab, a new drug developed by the two companies. Until now, there have been no drugs that can suppress the progression of dementia symptoms and this drug, the first new Alzheimer's treatment approved in the U.S. in 18 years, faced a bumpy road to get to this point.
Commercialization of the new drug will provide a big growth boost for both companies, which invested heavily in developing treatments for dementia.
Biogen had been working on Aducanumab since 2007 and Eisai joined the project a decade later to conduct joint clinical trials. The drug is aimed at patients in the early stages of Alzheimer's disease. It is effective in removing amyloid beta, which accumulates in the brain and is considered a disease-causing substance. The new drug also prevents the destruction of nerve cells.
Biogen's share price skyrocketed on news of the FDA approval, rising 64% at one point from last weekend before ending Monday 38% higher on the Nasdaq exchange.
"The approval of [Aducanumab] represents a crucial inflection point in our collective battle against Alzheimer's disease," said Biogen CEO Michel Vounatsos in a statement. "By addressing a defining pathology of the disease, this novel therapy has the potential to help fundamentally change the way patients are diagnosed and treated."
The approval process was not straightforward. Clinical trials, the basis for the approval decision, were split regarding the drug's efficacy. In one trial that involved about 1,600 patients in the early stages of Alzheimer's disease, patients given the drug for a year and a half showed about 20% less cognitive decline than those who did not receive the drug.
However, other trials failed to show any effect and development was temporarily halted in 2019. Later, a reanalysis of the data confirmed the drug's efficacy and development started again.
Even after Biogen submitted its application for approval to the FDA in July 2020, many members of the advisory committee expressed opposition. In addition, the FDA's target date for completing its review -- originally March 2021 -- was pushed back by three months to allow for the verification of additional data submitted by Biogen.
The FDA said Aducanumab "was clearly shown in all trials to substantially reduce amyloid beta plaques," and that "the evidence presented in the [Aducanumab] application met the standard for Accelerated Approval."
Because the drug has been designated for accelerated approval, a separate validation study will need to be conducted after it has gone on the market. The FDA said that if "the confirmatory trial does not verify the drug's anticipated clinical benefit, FDA has regulatory procedures in place that could lead to removing the drug from the market."
Alfred Sandrock, head of development at Biogen, said in an interview with Nikkei that the company respects the views of the advisory committee members, but he believed the FDA had decided that the benefits of the new drug outweigh the risks.
Even the conditional commercialization of the new drug is significant for both Biogen and Eisai. Eisai has been focusing on dementia since 1983, and has invested in the development of drugs like Aricept in 1997. The company has "invested an amount comparable to the mega-pharmaceuticals," according to Eisai CEO Haruo Naito.
Biogen has also focused on neurological diseases, particularly Alzheimer's disease.
At its peak, Aricept had annual sales of 300 billion yen ($2.74 billion at current exchange rates), underpinning Eisai's revenue. However, although the drug temporarily improves cognitive function, it loses its effectiveness after eight to 18 months and can no longer be administered.
Aducanumab, however, directly affects the causative agent, and can thus curb the worsening of symptoms over the long term.
Eisai, which has been investing aggressively with limited resources, is expected to profit significantly from the new drug's approval. The company filed for approval of Aducanumab in Japan in December 2020, and the process is expected to go smoothly now that the FDA has given the green light. Another Alzheimer's Eisai drug, Lecanemab, is in the final stages of clinical trials, and the company plans to apply for approval as soon as fiscal 2023.
Eisai is trying to expand its business to peripheral dementia treatment services, aiming to build a portfolio of products and services ranging from prevention to diagnosis and treatment.
However, Aducanumab still faces one more obstacle: pricing.
Aducanumab is a biopharmaceutical that uses antibodies -- the proteins that form the basis of human immunity. Biopharmaceuticals tend to be more expensive than conventional drugs, which are produced through chemical synthesis. There are concerns that such drugs will prove prohibitively expensive for health care systems.
Biogen announced on June 7 that the annual treatment cost of the drug would be $56,000. The intravenous treatment, which is given every four weeks, costs $4,312 per dose for a patient weighing 74 kg, the average weight of dementia patients in the U.S.
Biogen's Vounatsos said in an interview with CNBC that he believes the price is fair. Biogen and Eisai also issued a statement saying they would not raise the price of the drug for four years.
According to the World Health Organization, there are an estimated 50 million dementia patients globally, of which 60% to 70% have Alzheimer's disease. Some experts estimate the number will triple to 150 million by 2050.
The question for Eisai, which is "prepared to live and die with dementia [treatments]" according to Naito, is how it can link critical therapeutic drugs to peripheral services like prevention and diagnosis.