With just a passing glance, it would be easy to assume Biogen Inc (NASDAQ:BIIB) shares have only pulled back this week because of a bit of a “buy the rumor, sell the news” thinking.
After all, BIIB jumped nearly 10% on Friday following news that its Alzheimer’s disease treatment called aducanumab (BIIB-037) showed tremendous promise in Phase 1 testing, and Biogen shares were up more than 40% in the last 12 months. If any stock deserved a breather, it was BIIB.
There may well be more to the pullback though. While BIIB-037 did indeed show measurable efficacy as a therapy for Alzheimer’s, a mere four days later fresh data was released reminding investors that the Biogen drug may well be barking up the wrong Alzheimer’s disease tree.
Investors are at the proverbial fork in the road where they’re going to have to bet on one of the Alzheimer’s disease drug theories, or another. And, that starts with a closer look at both sides of the coin.
The Biogen Approach to Alzheimer’s
Broadly speaking, aducanumab was designed on the more common assumption that a buildup of amyloid plaque in the brain is the cause of Alzheimer’s disease.
Beta amyloid is a protein normally found in the fatty membrane of nerve cells. As long as it stays there, these proteins don’t cause problems. Over time, though, beta amyloid can build up as plaque around brain synapses, effectively cutting of the nerve impulses that are necessary for proper brain function. Moreover, an excess of this plaque has even been linked to the destruction of these synapses that ultimately store memories and controlling body movements.
The solution is to prevent the buildup and eventual clumping of beta amyloid, and if possible, reverse it.
That’s exactly what the Biogen trial of aducanumab aimed to do. And, though the study was limited only to patients just beginning to show signs of Alzheimer’s disease and it took a large doses of the drug to create a statistically significant outcome, the study’s results suggest might be on to something.
It’s still far too soon for investors to pop the champagne corks just yet, however.
While the trial’s outcome through Phase 1B offered promise to those patients willing and able to take good-sized doses of the drug, a small sample size of only about 160 trial participants isn’t going to cut it with the FDA. A much wider sample will be needed before any final approval is granted — and the bigger a trial gets, the greater the odds problems could surface.
And, in the BIIB-037 trial, the worst side effect (brain swelling) observed in the group taking the largest doses — the ones that experienced meaningful efficacy.
It’s also worth noting that similar anti-amyloid plaque treatments from Eli Lilly and Co (NYSE:LLY), Roche Holding Ltd. (OTCMKTS:RHHBY), Johnson & Johnson (NYSE:JNJ), and Pfizer Inc. (NYSE:PFE) have all failed to show any significant benefit in recent trials.
Other Approaches to Treating Alzheimer’s
Not all drug developers believe a buildup of amyloid plaque is the root cause of Alzheimer’s disease. Some have hypothesized it’s actually a buildup of a so-called tau protein behind the cognitive dysfunction generally diagnosed as Alzheimer’s.
Tau, like beta amyloid, is naturally found in the brain. Its role is to maintain nerve cells’ conduits that allow for the delivery of “food” and other proteins needed to maintain that cell. However, tau can become tangled, essentially closing off that conduit, leading to that cell’s death. Some researchers further believe the enzyme glycogen synthase kinase-3 (GSK-3) spurs this tangling, and are developing an inhibitor to stave off its effects.
While the tau theory remains the minority stance, the premise became at least a little more credible early this week after the findings from a study done by the Mayo Clinic were published in a trade journal. The research determined that an excess of tau protein was found in most of the brains of deceased Alzheimer’s victims. In fact, the level of tau protein determined the severity of the disease’s impact.
Though the study still didn’t offer a cause-effect relationship between high levels of tau or opine why tau could become entangled with itself to begin with, it did suggest the link between tau buildup and Alzheimer’s disease was stronger than the link between amyloid plaque and Alzheimer’s disease.
There are fewer drug developers focused on tau, and even fewer that are publicly-traded. It’s interesting that more and more mainstream developers are getting on board, though.
Johnson & Johnson is one of them. Through its subsidiary Jannsen Pharmaceuticals, it recently inked a deal with AC Immune to be the exclusive licensee of its tau-based Alzheimer’s disease drug ACI-35, currently in Phase 1 testing. Other major pharma companies may follow that lead, as the premise gains traction.
Bottom Line for Alzheimer’s Disease Drugs
While it’s possible Biogen may be on to something, in light of failures of similar Alzheimer’s juxtaposed with a new but promising approach via the suppression of entangles tau proteins, investors have a tough choice to make. While it’s concerning the anti-amyloid plaque approach has hit so many walls, it’s no less concerning that tau research is young.
The really confounding aspect of the debate, however, is the possible relationship between tau and amyloid plaque.
Some researchers believe the two work together to cause Alzheimer’s disease. The prevention of that interplay rather than the outright prevention of amyloid plaque and entangled tau may well be the key to a cure, as some have observed high levels of amyloid plaque alone — with no tau present — doesn’t lead to Alzheimer’s disease.
Conversely, tau tends to not become entangled if beta amyloid doesn’t react with it in the first place. Unfortunately, the brain needs both proteins to function properly, and it’s difficult to isolate them from one another.
To that end, it seems both research avenues have their merits, and their drawbacks. There’s little doubt that the answer is in the midst of the tau/amyloid debate though. What’s still unclear is the root mechanism. Until that’s discovered, all these trials are just best guesses.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.