Biogen MS Drug Tecfidera Wins Additional European ProtectionMeg Tirrell
Biogen Idec Inc.’s multiple sclerosis drug Tecfidera won designation as a “new active substance” in Europe, giving it added protection against generic copies and paving the way for approval there. The shares rose the most in more than two years.
The designation gives Biogen an additional 10 years of protection for Tecfidera, its pill for MS that’s projected to be the company’s top-seller by 2015. The European Medicines Agency’s Committee for Medicinal Products for Human Use posted the decision on its website today, updating a previous opinion.
Tecfidera was cleared in the U.S. and recommended for approval in Europe in March. Biogen had been in talks with regulators on the status of the extra protection before seeking final approval there, in an effort to hold off development of copycats for as long as possible. Analysts estimate the drug will draw $3.52 billion in revenue in 2016.
“The binary nature of this decision has been an overhang to Biogen shares since late May,” Eric Schmidt, an analyst with Cowen & Co., wrote in a research note today. “With a global launch of Tecfidera now likely, we expect Biogen to emerge as the cleanest long-term growth story in biotech.”
Biogen, which will move into its new Cambridge, Massachusetts, headquarters next week, rose 13 percent to $285.62 at the close in New York, its biggest gain since April 2011. The stock has gained 95 percent this year.
The EMA committee in June granted the new active substance designation to a Sanofi MS pill called Aubagio, reversing an earlier decision. Tecfidera’s main ingredient is dimethyl fumarate, a substance also found in Fumaderm, an older medicine used for psoriasis. Aubagio, also known as teriflunomide, has some similarities to an earlier medicine, leflunomide, Brian Abrahams, an analyst with Wells Fargo, wrote yesterday in a research note.
Biogen also sells the MS drugs Avonex, an injection, and Tysabri, an infusion. Michael Yee, an analyst with RBC Capital Markets, said today he expects Tecfidera will be approved in Europe by January and sold there starting in the first quarter as Biogen obtains reimbursement for the medicine in each country.
Approved in the U.S. in March, Tecfidera generated $286.4 million in third-quarter revenue, surpassing analysts’ estimates. About 35,000 patients are on the medicine, making it the most-prescribed pill for relapsing-remitting MS, Tony Kingsley, Biogen’s head of commercial operations, said earlier this month.
Sanofi’s Aubagio is also a pill, competing with Tecfidera as well as Novartis AG’s Gilenya.
“We are ready to introduce Tecfidera in EU countries shortly after anticipated approval,” Doug Williams, head of Biogen’s research and development, said in a statement today.