NEW YORK (Associated Press) - Wall Street continues to maintain a positive outlook on Biogen Idec Inc.'s multiple sclerosis drug Tysabri, as another safety label change seems to have appeased the Food and Drug Administration and the company said two patients suffering from potentially fatal side effects are recovering.
The Food and Drug Administration late Monday said it is working with the company to address label changes to the drug, though the Cambridge, Mass.-based company said it has already updated the warning.
The prior label warning addressed the risk for patients taking the drug in combination with other therapies, while the new addition addresses the risk for patients taking only Tysabri to treat the autoimmune disorder.
"In a sign of support for the drug, the FDA stated that Tysabri monotherapy may lead to a lower risk of PML compared to Tysabri used in combination with other immunomodulatory therapies," said Thomas Weisel Partners analyst M. Ian Somaiya, in a note to investors. "We view the label change as relatively minor and believe it reflects the FDA's support for continued Tysabri use."
He reaffirmed a "Market Weight" rating, though, over concern there could be further downside to the stock if new cases are reported in the U.S.
Biogen shares gained 55 cents to reach $54.16 before midday.American Depository Shares of Elan jumped 60 cents, or 4.2 percent, to $14.85 Tuesday. The stock has traded between $9.55 and $37.45 over the last 52 weeks.
Deutsche Bank-North America analyst Mark Schoenebaum also reaffirmed a "Market Weight" rating on Biogen, keeping a positive outlook for the drug, but acknowledging that more PML cases are likely in the future.
"The lack of new cases and recovery of these two cases may provide a short-term upswing for Biogen's stock," he said, in a note to investors.He is maintaining an estimate of 56,000 patients on Tysabri by 2013.
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