Biohaven Drug Is a Long Shot, but Success Could Boost Shares

Results of phase 3 study of treatment for rare disease expected by mid-year

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Mar 22, 2022
  • Troriluzole could add $800 million to its top line in 2030, say analysts
  • Wall Street gives drug’s chance for success at 25%
  • Company optimistic changes in study protocol could make the difference
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Biohaven Pharmaceutical Holding Company Ltd. (

BHVN, Financial) and its shareholders could be in for a pleasant surprise if the company’s failed Alzheimer’s drug proves effective in treating a rare disease.

The odds are long, but the company is keeping its fingers crossed that troriluzole performs well in a phase 3 trial in patients with spinocerebellar ataxia. A readout is expected before the middle of the year.

Sell-side analysts on Wall Street aren’t optimistic about troriluzole’s chances of meeting study goals, with Leerink putting the likelihood of success at about 25%, reported the pharma consulting group Evaluate. But if troriluzole surprises, it’s projected to add about $800 million to Biohaven’s coffers in 2030. That would be a nice boost for a company that registered sales of just over $462 million in 2021.

Even if the study craters, analysts don’t think it will be a big deal given positive results probably aren’t reflected in the current share price. At the same time, a successful trial would likely be a big lift for the company and perhaps its stock.


It’s probably not prudent for investors to bank on troriluzole’s eventual approval for what would be the first therapy for a rare disease characterized by problems with coordination. After all, the drug already came up short in a phase 2/3 trial in this condition, as well as obsessive-compulsive disorder and generalized anxiety disorder.

However, Biohaven thinks several changes in the study protocol coupled with a higher dose could increase the chances for a successful result. A single positive pivotal study could be enough to get the drug over the regulatory hump in the U.S. given the unmet need and the dearth of treatments in the pipeline.

In 2021, Biohaven posted a loss of $13.09 per share, 3 cents higher than 2020’s loss. Adjuted loss in 2021 was $9.86 per share, narrowing 4.4% year over year.

Wall Street didn’t like those numbers. Shares of the New Haven, Connecticut-based biotech retreated nearly 9% on Feb. 25 following the release of its quarterly and year-end results. The good news is that company’s stock is up more than 40% in the past year while the industry declined more than 37%.

All of Biohaven’s revenues last year came from its migraine treatment Nurtec ODT, which soared 40% sequentially and 441% year over year due to strong demand coupled with higher prices. The drug was launched about two years ago.

Biohaven pulled off two deals last month. In the first, it strengthened its neurosciences unit by acquiring Channel Biosciences and its experimental epilepsy treatment for $100 million in cash and stock. The company also licensed a potential spinal muscular atrophy drug from Bristol Myers Squibb (BMY).

Investor’s Daily reported Piper Sandler analyst Christopher Raymond heartily endorsed the arrangements. "The two deals announced today add significant pipeline optionality at a reasonable price, in a development space that we see as right in Biohaven's wheelhouse," Raymond said in a report to clients. He kept his overweight rating on the stock.


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