Sector News

Biogen to spin off hemophilia drugs business

May 4, 2016
Life sciences

Biogen Inc plans to spin off its hemophilia drug business as a publicly traded company, leaving the drugmaker to focus on developing drugs for neurodegenerative diseases, the company said on Tuesday.

Biogen said it considered a number of alternatives including a sale before deciding to split the business in a tax-free transaction, which it said would deliver the most value to its shareholders.

The new company will include treatments Eloctate and Alprolix for hemophilia A and B, which had total sales of $554.2 million in 2015, about 5 percent of Biogen’s revenue. Hemophilia is a group of hereditary genetic disorders that impairs the body’s ability to control blood clotting.

Biogen began a sweeping restructuring program in October to cut costs and focus on core areas such as neurology and autoimmune diseases. In April, Reuters reported that it was looking at selling the hemophilia assets.

After that report, Citi analyst Robyn Karnauskas said the business could be worth $4.8 billion to $6.4 billion.

Biogen expects the transaction to occur by the end of this year or early next year.

Biogen will focus on developing drugs for neurodegenerative diseases such as multiple sclerosis, spinal muscular atrophy (SMA), Alzheimer’s disease, Parkinson’s disease, amyotrophic lateral sclerosis (ALS), and neuropathic pain. It will keep its bestselling MS drug, Tecfidera.

The company’s promising Alzheimer’s drug candidate generated excitement last year after early data showed a reduction in amyloid plaque in the brain and some cognitive improvement.

Biogen’s collaboration on Eloctate and Alproprix with Swedish Orphan Biovitrum AB will continue, CEO George Scangos said during a conference call with analysts. The move to spin off the hemophilia drugs would have been premature 6 or 12 months ago, he said. “It’s not really a shift in strategy. It is the fact that the business has matured. It is doing very well. It is profitable. It can stand on its own,” Scangos said. The area of the company focused on hemophilia also has a pipeline of experimental products that need to be “aggressively” developed, he said.

Biogen’s executive vice president, pharmaceutical operations and technology, John Cox, will be the chief executive officer of the new company, which will be based in the Boston area, Biogen said.

Biogen shares were largely unchanged in early trading at $274.52, versus their Monday close of $273.67.

By Amrutha Penumudi and Rosmi Shaji in Bengaluru and Caroline Humer in New York

Source: Reuters

comments closed

Related News

September 25, 2022

Rise of the machines: Novo Nordisk pledges $200M to create first quantum computer for life sciences

Life sciences

Big Pharma has long seen the potential for AI and machine learning to accelerate drug development. But Novo Nordisk is going a step further by channeling $200 million toward the creation of a computer that will outrun anything in existence.

September 25, 2022

Mount Sinai AI uncovers new brain analysis method to predict dementia, Alzheimer’s disease

Life sciences

Current methods for diagnosing Alzheimer’s disease rely on a complex combination of self- and caregiver-reported symptoms, a physical examination and either a PET scan or a spinal tap to look for evidence of amyloid plaque build-ups in the brain. But a new artificial intelligence-based method may make the diagnostic process a much more objective one.

September 25, 2022

New AstraZeneca-backed report finds big money behind diverse owners and entrepreneurs in Europe

Life sciences

There is lots of talk about diversity and inclusion in business, including in pharma and medtech. A new report by the Open Political Economy Network (OPEN), a think tank focusing on migration and diversity, released its “Minority Businesses Matter: Europe” report highlighting the successes and challenges of ethnic minority-owned businesses in Europe.