Analysts: Donanemab approval to boost amyloid-blocking Alzheimer’s drugs

The approval of Eli Lilly's experimental Alzheimer's drug, donanemab, is expected to boost the sales of Eisai and Biogen’s competing medication, Leqembi, according to analysts. Following a favorable recommendation from an FDA panel on Monday, donanemab is poised to receive the agency's approval soon.

Myles Minter, an analyst at William Blair, expressed optimism, suggesting that the approval of donanemab could be beneficial for the entire market. Like Leqembi, donanemab targets the reduction of a toxic brain protein called amyloid, which is believed to contribute to the progression of Alzheimer's disease.

Although Leqembi was approved in the U.S. last year, its market adoption has been slow. Over one million people are estimated to be suitable candidates for amyloid-blocking treatments, yet Leqembi only achieved $19 million in sales during its initial quarter. There is ongoing debate regarding which drug, Leqembi or donanemab, might hold a market advantage. Leqembi is perceived as safer, while donanemab offers a more convenient dosing schedule.

Analyst Paul Matteis from Stifel highlighted that Leqembi’s safety profile is particularly important for risk-averse neurologists. Ahead of the FDA meeting, he noted that the drug’s clear safety advantages are significant. At that meeting, FDA expert advisers unanimously agreed (11-0) that donanemab’s benefits outweigh its risks, paving the way for likely approval.

Some analysts argue that the presence of both drugs on the market could paradoxically benefit each other. Brian Abrahams from RBC Capital Markets suggested that Lilly’s marketing efforts to promote donanemab could also bolster the market presence of Biogen’s Leqembi.

Both Leqembi and donanemab are the results of extensive research and significant financial investment into the theory that removing amyloid deposits can mitigate cognitive decline in Alzheimer’s patients. This field has seen notable failures, including the controversial launch and subsequent withdrawal of Biogen’s Aduhelm.

Leqembi’s approval was initially expected to lead to widespread use, but Eisai and Biogen encountered resistance from insurers, particularly with Medicare, which only extended coverage after the FDA converted its conditional approval to full standard approval.

Analyst Marc Goodman from Leerink Partners commented that donanemab’s approval could help accelerate the market acceptance of amyloid-blocking drugs by building the necessary commercial infrastructure. Having two treatments available can increase awareness among physicians and patients, which should drive demand, according to Jefferies analyst Michael Yee.

The preference for either drug will depend on how stakeholders weigh the risks and benefits. Both treatments have associated risks, such as a brain-swelling side effect known as ARIA, linked to amyloid removal. Donanemab, however, requires infusions every four weeks compared to Leqembi's biweekly regimen. In Lilly’s main clinical trial, donanemab was effective enough that patients could stop treatment after an average of 47 weeks.

The increased risk of ARIA with donanemab could necessitate more frequent MRI scans to monitor for side effects, potentially raising treatment costs and burden. Conversely, the less frequent dosing might offset these drawbacks.

The Institute for Clinical and Economic Review, a nonprofit organization, had initially estimated that donanemab would be less expensive per life year gained if both drugs were priced equally, though they later retracted this evaluation following an earlier FDA decision on Lilly's application.

Analyst Matteis from Stifel believes that donanemab will help grow the market for amyloid-blocking drugs without cannibalizing Leqembi's market share. He expects that the differences in ARIA risk and dosing schedules will balance out, allowing space for both treatments in the market.