What Happened?
Shares of biotech company Biogen (NASDAQ: BIIB) jumped 4.8% in the afternoon session after the company and its partner Eisai received FDA approval for a weekly subcutaneous injection of their Alzheimer's drug, Leqembi, for maintenance dosing.
The new, more convenient formulation, which will be marketed as Leqembi Iqlik, allows for at-home administration for patients who have been on the drug for 18 months. This provides an alternative to the previous hour-long intravenous infusions. Adding to the positive momentum, Biogen, along with partner Stoke Therapeutics, presented promising data for zorevunersen at the 36th International Epilepsy Congress. The data showed durable seizure reductions in patients with Dravet syndrome, a severe form of epilepsy, supporting the drug's potential as a first-in-class disease-modifying treatment.
After the initial pop the shares cooled down to $138.69, up 4.9% from previous close.
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What Is The Market Telling Us
Biogen’s shares are not very volatile and have only had 4 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The previous big move we wrote about was 20 days ago when the stock gained 4.1% on the news that markets continued to rally amid growing speculation of an impending interest rate cut by the Federal Reserve. Following a favorable Consumer Price Index (CPI) report, investors are increasingly betting on a rate reduction next month, a sentiment amplified by U.S. Treasury Secretary Scott Bessent's call for a significant cut. This has fueled a 'risk-on' environment across Wall Street. Lower interest rates are typically beneficial for growth-oriented sectors like healthcare, as they reduce the cost of borrowing for research and innovation and increase the present value of future earnings.
Biogen is down 7.5% since the beginning of the year, and at $138.69 per share, it is trading 32.3% below its 52-week high of $204.95 from September 2024. Investors who bought $1,000 worth of Biogen’s shares 5 years ago would now be looking at an investment worth $485.62.
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