Biogen sends CEO to the exit, abandons Aduhelm sales team in $1B overhaul
Biogen’s yearlong struggle with the controversial FDA approval and launch of Aduhelm has culminated in a deep overhaul reaching all the way to the CEO.
Biogen CEO Michel Vounatsos is ending his five-year-plus tenure, and the search is on for his successor, the company revealed Tuesday, along with a plan to “substantially eliminate” its commercial infrastructure for Aduhelm.
Trimming the Aduhelm commercial team and other cost-reduction measures are expected to save Biogen $500 million a year, bringing the company’s total cost-saving target to $1 billion.
That leaves the company with “minimal resources” to manage existing patient access programs, Vounatsos said during an investor call Tuesday. But that doesn’t mean Biogen is ready to give up on Aduhelm altogether. The company will continue to fund Aduhelm’s ongoing redosing study and, more importantly, its upcoming confirmatory trial, dubbed ENVISION.
Biogen unveiled a first $500 million cost-cutting program in December after halving Aduhelm’s price in anticipation of a draft Medicare coverage policy for Aduhelm. The company is now escalating the dramatic measures following a negative final Medicare decision which Vounatsos said effectively denies all patients access to Aduhelm. In that final decision, unveiled in April, the Centers for Medicare & Medicaid Services is limiting reimbursement to anti-beta amyloid antibodies like Aduhelm to approved clinical trials.
Without proper coverage, Aduhelm sales in the first quarter were only $2.8 million. Biogen also recorded about $275 million of charges from Aduhelm inventory write-offs.
Cutting the Alzheimer’s commercial capabilities comes as Biogen and partner Eisai expect to finish rolling submission for an FDA accelerated approval of their second Alzheimer’s asset, lecanemab, by June. The drug is also looking at a phase 3 readout from the confirmatory Clarity AD study in fall for a potential filing, which is now planned for the first quarter of 2023 for a full approval.
Biogen could arguably keep the team to potentially support lecanemab’s launch. So, scaling back now could be read as reduced confidence in the follow-on candidate. But Vounatsos said the company simply can’t wait that long.
“Based on the timing, it makes no sense to carry such a large team for such a long time,” Vounatsos said. “The preparation that was made on the infrastructure is there, and it’s certainly a big benefit for the entire class moving forward. But we could not afford to keep the team, unfortunately, for that many months.”
“Our sentiment on lecanemab does not change, just to be clear,” the CEO said.
Vounatsos called the CEO transition a “natural event” that would be “good for everyone involved.” He became Biogen’s CEO at the beginning of 2017. The outgoing chief described his reign as a “good term,” pointing out that his past key stints lasted similarly long.
In addition to the CEO transition and commercial slimdown, Biogen is also reprioritizing its R&D pipeline to potentially “accelerate, terminate, divest, or partner certain programs.”
“We will anchor to areas where we have success, where we have expertise, and build around those areas,” Priya Singhal, M.D., Biogen’s interim R&D head, told investors during the call.
Vountasos also confirmed that this rebalancing of R&D risks could be “potentially for some” commercial products. Still, Biogen will continue to stay within neuroscience, Singhal said, but it’s also looking for “adjacencies.”
May 3, 2022
