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Biogen chairman to step down as new CEO walks thin line with Alzheimer’s launch Leqembi

Biogen will soon have a new board leader, potentially giving new CEO Chris Viehbacher more freedom to make bold moves to salvage the big biotech from declining revenues and a bruised reputation.

Biogen’s long-time chairman and influential biotech mogul Stelios Papadopoulos, Ph.D., will retire from the post under company policy, Viehbacher told reporters during a call Wednesday.

Papadopoulos, 74, is nearing Biogen’s mandatory retirement age of 75 for directors. He has been Biogen’s chair since 2014 and was founder of several other companies, including targeted cancer drug maker Exelixis.

Papadopoulos is nearing the end of his board tenure as Biogen reels from revenue declines across its business sectors, plus the disastrous launch of Alzheimer’s disease drug Aduhelm.

In 2022, every revenue line item declined at Biogen. Thanks to generics to Tecfidera, Biogen’s multiple sclerosis revenues dropped 11% to $5.4 billion. Increased competition led sales of spinal muscular atrophy therapy Spinraza to fall by 6% to $1.8 billion. Pricing pressure contributed to a 10% decrease for Biogen’s biosimilars. And Aduhelm? The launch didn’t go anywhere.

To Viehbacher, who took over in November, transforming Biogen is a top priority. He’s counting on Eisai-partnered Alzheimer’s drug Leqembi and Sage Therapeutics-shared depression med zuranolone to bring the goods.

During a call on Wednesday, Viehbacher spent a lot of time walking a thin line between talking up Leqembi’s potential and managing investor expectations. After all, the drug’s predecessor Aduhelm, a drug once billed as a potential $10 billion blockbuster, only generated $13 million last year.

“I’ve been in this business a long time. It’s pretty rare that you’d have this opportunity to launch not one, but two, major products,” Viehbacher said. “And not just any products, but products that are really quite transformative in their respective therapeutic areas.”

Just a few seconds later, the chief executive switched to a more cautious tone, noting that Leqembi is “not a round white pill” that can be launched easily. Diagnostic and infusion capacity restrictions, plus the overall limited number of neurologists, could hinder the rollout, he said.

The infrastructure challenges and the need for education around diagnosis and safety means Leqembi is opening up “a whole new vista” for physicians and patients, Viehbacher said.

One “game changer,” to Viehbacher, is blood biomarkers that could potentially eliminate the need for PET scans and lumbar puncture for Alzheimer’s diagnosis. But those tests are still years away, he said.

Another big hurdle is Medicare coverage. Eisai is in talks with the Centers for Medicare & Medicaid Services, hoping to rework a restrictive coverage policy around anti-amyloid antibodies like Leqembi.

Previously with Aduhelm, the CMS, Biogen, physician groups and patient advocacy bodies engaged in a heated debate over reimbursement. But the tone from the community is much different this time with Leqembi, Viehbacher said, noting that the American Association of Neurologists recently wrote to the CMS to support the new drug’s reimbursement.

Neurologists view Leqembi’s phase 3 Clarity AD data as “very compelling,” and “there’s a growing consensus that this is a medicine that is very much needed by a broad population,” the Biogen CEO added.

Viehbacher declined to put a timeline to potential resolution of Medicare’s coverage policy limitations. While one analyst on Wednesday’s call suggested nine months based on a precedent, Viehbacher argued past experience simply doesn’t matter because Leqembi is in an unusual situation.

Before any progress with CMS, Biogen expects Leqembi’s commercialization expenses to exceed the drug’s revenues in 2023. Biogen is also redirecting some resources from the MS franchise to support Leqembi’s launch, Viehbacher said. But the company will need to find the right balance so it doesn’t further hurt MS sales, he added.

Biogen is still in the middle of a cost-cutting initiative, which aims to save $1 billion per year. Plus, Eisai’s move to bow out of the Aduhelm partnership puts more pressure on Biogen’s costs in 2023. So, Viehbacher is trying to be careful with where he spends.

“One of the things I’m really trying to drive here is focus in the company—what really matters, what’s going to grow the business and how do we align our resources behind that,” Viehbacher said.