Sunday, May 11

Biogen Says No New Brain Infections In First Tysabri Update

By Thomas Gryta Of DOW JONES NEWSWIRES NEW YORK -(Dow Jones)- Biogen Idec Inc. (BIIB) reported that there were no new cases of a rare brain infection in users of its multiple sclerosis drug Tysabri in the first of its planned weekly Web-based updates on Friday.

The Cambridge, Mass., biotech, which sells Tysabri with Ireland's Elan Plc (ELN), will post the updates in an effort to more consistently disclose incidences of the often fatal condition.

A suspected link to progressive multifocal leukoencephalopathy, or PML, led to Tysabri being pulled from the market for 18 months beginning in 2005. Since the relaunch, the company has reported that four people had confirmed cases of PML, with one dying.

This past summer marked the two-year anniversary of Tysabri's re-launch, raising Wall Street's anxiety over PML-related news. The timeline is important because two patients with PML in 2005 were using the drug for more than two years.

Biogen will post an update of PML cases on the investor relations section of its Web site every Friday at 4:30 p.m. EST and will continue to do so until July 24, which is the third anniversary of the drug's relaunch.

"I think it is going to provide a lot of clarity and almost realtime information to the market to really make decisions and evaluate the situation," said Citigroup analyst Yaron Werber.

Werber has criticized Biogen's former policy of disclosing new cases through 8-K filings with the Securities and Exchange Commission as making investors nervous and pressuring the company's shares.

Biogen's stock, which closed up 30 cents, or 0.6%, at $48.25, is down 17% for the last 12 months.

Elan closed Friday down 31 cents, or 3.6%, at $8.39 and is down 67% in the last year. Tysabri is Elan's biggest seller, making it more sensitive to related news, plus it was hurt by disappointing data over the summer from an Alzheimer's disease drug in development with Wyeth (WYE).

Werber expects the regular updates to help ease of the "fear of the unexpected" in Biogen shares. He agrees with stopping the disclosures in late July, when a clear picture of the PML risk in Tysabri should be firmly established. "

At some point they would be wise to cut this off," he said. "Because this sort of information is going to be very good for the competition. You can't go on marketing a product in this situation forever."