Biogen reported third-quarter revenue of about $2.5 billion Tuesday, edging out Wall Street’s forecast, as a data readout nears for its closely watched Alzheimer’s candidate.

The biotech’s $2.51 billion in sales came in just ahead of the $2.47 billion anticipated by a consensus of analysts, driven by better-than-expected revenue from some in-line brands. 

SMA drug Spinraza brought in $431 million during the quarter (versus consensus of $415 million), and MS drug Tecfidera saw turnover of $340 million (versus $319 million). On the negative side, the $138 million in sales of MS pill Vumerity missed Wall Street’s estimate by $9 million. 

All are facing pressure from generics, payers and competition. Arguably more important to the company’s future is the regulatory pathway and commercial preparations for Alzheimer’s hopeful lecanemab. 

Last month, Biogen and partner Eisai reported top-line Phase 3 data for the monoclonal antibody. Lecanemab met the trial’s primary endpoint with a treatment difference of 0.45, which translated into a statistically significant 27% change versus placebo. Additionally, all secondary endpoints were met.

Eisai is slated to present full results from the study next month. Although long-term safety remains a question, analysts said that the top-line results position lecanemab for accelerated approval by the Food and Drug Administration on January 6. After that, the companies are likely to file for traditional approval.

On a Tuesday analyst call, Biogen was asked how quickly the company would ramp up spending for a launch. It’s a valid question, given that it was forced to disband its Alzheimer’s sales and marketing team after Aduhelm failed to secure Medicare coverage, not to mention the move from a potential accelerated approval to a full one.

With final decision-making authority resting with Eisai, the Biogen execs provided little in the way of additional details on launch preparations, any exchange with regulators or pricing considerations. They did, however, offer some color.

CEO Michel Vounatsos reiterated on the call that “we had no choice than to take the actions that we took,” due to the gap between Medicare’s Aduhelm reimbursement decision and the lecanemab readout. “Now there is a new page.”

Should Biogen and Eisai receive accelerated approval for lecanemab early in the year, Vounatsos added, Biogen would assess the “relative strength” on each continent of filing for full approval at the same time in the U.S., Europe and Japan. 

Management acknowledged there is essentially no coverage for the drug with accelerated approval only.

Approved under that same pathway in June 2021, Biogen’s Aduhelm flopped commercially after the Centers for Medicare and Medicaid Services refused to extend coverage. Even slashing the price in half didn’t work. Some private payers and academic medical centers also balked at the drug’s high price, versus its uncertain clinical benefit.

Following the Aduhelm disaster, the company launched a restructuring program designed to save $1 billion. It also embarked on a search for a new CEO to replace Vounatsos. 

“Most of [Aduhelm’s sales force] has been eliminated as part of our $1 billion cost savings that we’ve committed,” said CFO Michael McDonnell on the Tuesday call. “And so for the most part, the lecanemab commercialization will be a new ramp and a new infrastructure that will be built.”

As for building that infrastructure, “We’ll do that in a very paced and controlled manner,” Vounatsos pledged.

Left unsaid is that rebooting the commercial team is one thing, but asking CMS to reconsider reimbursement is quite another.

As part of its national coverage decision (NCD) in April, CMS said that it would consider full coverage of future monoclonal antibody drugs directed against amyloid plaque — should any such agents receive full FDA approval.

“Eisai is already engaging with CMS to discuss this,” noted Priya Singhal, Biogen’s interim R&D chief. She added that “in the final scenario [of] that NCD…[CMS noted that it] would act with urgency and potentially a reconsideration could be [taken up]. That could take nine to 12 months.”

Updating the CMS coverage decision, along with the rigor of any future registry studies that may be required to achieve full approval, depends on the quality of the full dataset, Singhal said. She noted that Biogen continues to engage with CMS as it awaits the lecanemab data readout.

Meanwhile, on Tuesday Biogen also slightly increased its 2022 top-line guidance, from a range of $9.9 billion to $10.1 billion to $10.0 billion to $10.15 billion. Analysts, however, cautioned that the slightly better performance doesn’t change prospects for its aging portfolio.

“The outlook for existing MS and Spinraza franchises remains poor,” wrote Raymond James analyst Danielle Brill in an investor note. “Biosimilars are the only product segment that is actually expected to grow over the next few years.”

Older med Tecfidera’s revenue declined 32% versus the third quarter of 2021, due to generic entry in the U.S. and elsewhere, primarily in Germany. Earlier this month, an EU court issued a non-binding advisory opinion which, if adopted, would give Tecfidera statutory market protection until at least February 2024. 

“There is no deadline for the court to issue its final decision, but we understand that approximately three to five months after issuance of the advocate general’s opinion is typical,” McDonnell said.

Given that Biogen must split lecanemab profits 50/50 with Eisai, it’s unlikely that its cut of the revenue alone can ease the company’s pain, Brill pointed out. That said, Biogen can ill afford a repeat of past mistakes. 

As Vounatsos later admitted, it was wrong to launch Aduhelm with a $56,000 a year price tag. Also, there were significant delays between the commercial ramp-up and realization of revenue.

To that end, Biogen must work hand-in-hand with Eisai on pricing and putting an infrastructure in place that supports the best possible launch of lecanemab.

“Obviously, there were a number of things on Aduhelm that didn’t go the direction that we had anticipated,” said McDonnell. “But I do feel confident that we’ll be able to gauge [lecanemab’s launch preparation] in a way that…the ramp in spend will have better proximity to revenue than what you saw on Aduhelm.”