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Monday, June 7 is a date biotech investors should circle on their calendars, if they haven’t already. It’s the deadline for the U.S. Food and Drug Administration to decide whether to approve
Biogen’s
much-debated Alzheimer’s disease therapy, aducanumab.
The news will have enormous implications for patients, for Biogen (ticker: BIIB), and for the biotech sector.
More than six million Americans have Alzheimer’s, and, as Barron’s highlighted in February, it has been nearly two decades since a new treatment for the disease has been approved. Yet experts have questioned whether aducanumab is good enough. An FDA advisory committee said in November that the data Biogen gathered didn’t prove the drug’s efficacy.
The FDA’s decision will be sure to spark a big move in Biogen shares. Jefferies analyst Michael Yee wrote on May 12 that the stock could climb as much as 70% if the drug gets approved—and fall as much as 40% if it is rejected.
And there will be ripple effects. Biogen shares make up 3.6% of the
iShares Nasdaq Biotechnology
exchange-traded fund (IBB). Success for Biogen would boost the ETF and help biotech recover from a recent slide.
But for Biogen, the challenges won’t end on June 7. Even if aducanumab gets approved, healthcare payers may balk at paying for it. The Institute for Clinical and Economic Review, an influential voice on drug pricing, issued a draft report on May 5 that presented prices for aducanumab based on cost-effectiveness calculations. They’re a fraction of the price Biogen is expected to set if the drug wins approval.
Next Week
Monday 5/31
Stock and fixed-income markets are closed in observance of Memorial Day.
The Organization for Economic Cooperation and Development releases its latest economic outlook. In its March interim report, the OECD projected a 5.6% growth rate for global gross domestic product in 2021, an upward revision of a full percentage point from the December 2020 forecast.
Tuesday 6/1
Hewlett Packard Enterprise,
and
Zoom Video Communications
announce quarterly results.
The Institute for Supply Management releases its Manufacturing Purchasing Managers’ Index for May. Consensus estimate is for a 60.8 reading, roughly even with the April data.
The Census Bureau reports construction spending for April. Expectations are for a 0.6% month-over-month rise to a seasonally adjusted annual rate of $1.52 trillion. Construction spending remains just below its all-time peak in January of this year.
Wednesday 6/2
NetApp,
and PVH report earnings.
Philip Morris International
hosts a webcast led by CEO Jacek Olczak to discuss the company’s sustainability strategy.
The Federal Reserve releases the beige book for the fourth of eight times this year. The report presents anecdotal data on the health of the economy collected by the 12 Federal Reserve Bank districts.
Thursday 6/3
ADP releases its National Employment report for May. Consensus estimate is for a 610,000 gain in nonfarm private-sector employment, following an increase of 742,000 in April.
J.M. Smucker,
and
Lululemon
Athletica hold conference calls to discuss earnings.
The Bureau of Economic Analysis reports total light-vehicle sales for May. In April, they hit a seasonally adjusted annual rate of 18.5 million, the highest figure since July 2005.
The ISM releases its Services PMI for May. Consensus estimate is for a 63.2 reading, compared with April’s 62.7 figure.
Friday 6/4
Amgen
hosts a conference call to discuss drug trial data from its oncology pipeline. The information will be presented at the 2021 American Society of Clinical Oncology annual meeting, which runs virtually from June 4 through June 8.
The Bureau of Labor Statistics releases the jobs report for May. Economists forecast a 700,000 rise in nonfarm payrolls, after a relatively modest 266,000 gain in April. The unemployment rate is expected to edge down to 5.9% from 6.1%. The April increase was a massive shortfall from the one million jump expected by some economists.
Write to Josh Nathan-Kazis at josh.nathan-kazis@barrons.com