In June, a judge in West Virginia ruled that the patent for Biogen’s drug Tecfidera was invalid. While Biogen intends to appeal the ruling their chances for success are not high. Mylan (MYL), who brought the lawsuit, has said they will start producing biosimilars as soon as possible. In 2019, Tecfidera had sales of $4.4 billion which was around 31% of Biogen’s total revenues. Despite the setback from Tecfidera, Biogen still has a promising pipeline, headlined by their Alzheimer’s drug Aducanumab, and a fast-growing drug in Spinraza for spinal muscular atrophy (SMA). In 2019, sales of Spinraza grew 22% year-over-year to over $2 billion. Meanwhile management at Biogen is confident the FDA will approve Aducanumab, giving them another potential avenue for growth. Biogen had over $4.8 billion in cash and equivalents and sells for less than 12 times earnings.
From Jeff Auxier (Trades, Portfolio)'s Auxier Asset Management summer 2020 market commentary.
