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Biogen’s aducanumab would be first new treatment in years for disease if approved by FDA

The pharmaceutical industry is eagerly awaiting the US regulator’s decision on a potential blockbuster Alzheimer’s drug. The drug is controversial but, if approved, would be the first new treatment for the debilitating disease in years.

The US Food and Drug Administration is expected to announce on Monday whether or not it approves Biogen’s drug aducanumab, which claims to slow the progression of Alzheimer’s disease. 

Why is this important?

If aducanumab is approved, it would be one of the most significant decisions the FDA has made in years. For many Alzheimer’s sufferers and their families it would be hailed as revolutionary in a field where few treatments exist and no new drugs have been approved since 2003.

But the drug, which Biogen made alongside Japanese company Eisai, has been mired in controversy, with many arguing that the treatment simply does not work.

In January, the FDA postponed its decision after months of delays. Pharma investors, as well as the 6m people living with Alzheimer’s in the US, are nervously waiting for the regulator’s conclusion.

“Without question this is the biggest binary event in biopharma in 2021,” said Colin Bristow, an analyst at UBS, referring to the drug’s approval or rejection.

How does the drug work?

Aducanumab is a monoclonal antibody treatment which is administered intravenously to patients with moderate Alzheimer’s disease.

Biogen says that the drug binds to beta amyloid molecules that create plaques in the brain and breaks up the clumps, thereby reducing the progression of Alzheimer’s so people can continue to perform daily tasks such as cleaning and shopping.

The drug tests the “amyloid hypothesis”, proponents of which believe that plaque build-up in the brain causes Alzheimer’s.

Howard Fillit, founding executive director of the Alzheimer’s Drug Discovery Foundation, called it “the first rigorous test of the amyloid hypothesis”.

What are the controversies around the drug?

Many scientists dispute that aducanumab works at all following a series of issues with Biogen’s clinical trials. 

In March 2019, Biogen halted its two trials after an independent committee said the drug was not going to be effective. But in October 2020, the company said new analysis of a larger trial data set showed the drug worked when given at a higher dose.

Biogen has also been criticised for supplying analysis after its trials have concluded and some scientists say its data is insufficient to merit regulatory approval. In November, an FDA advisory panel hit back at the agency’s findings of “substantial evidence” that aducanumab worked.

“There’s a clear and well delineated bar that a product has to be able to get over in order to access the market and this product didn’t,” said Caleb Alexander, professor at the Johns Hopkins Bloomberg School of Public Health, and one of the panel members.

“I’ll fall out of my chair if they approve it,” he said, adding that a green light “would mark one of the most consequential and poor decisions that the FDA has made in recent history”.

Why do so many people oppose the drug?

A string of pharmaceutical companies have tried and failed to prove the amyloid hypothesis and create a drug that slows the advance of Alzheimer’s. Little evidence exists that clearing amyloids reduces progression of the disease.

The aborted trials include Pfizer and Johnson & Johnson’s scrapped study in 2012 and Merck’s failed trial in 2017. Last year, Eli Lilly and Roche’s two drugs also both failed to slow the rate of cognitive decline.

What happens if it is approved?

Approval will be hailed by those living with Alzheimer’s as a way forward, as well as a vindication for Biogen which has battled criticism of its handling of the drug’s development for years.

The Alzheimer’s Association has urged the FDA to endorse aducanumab, saying that any treatment that gives patients more time is worthwhile. 

Analysts expect the drug to become a blockbuster seller for Biogen, although revenue estimates vary.

Matthew Harrison, head of biotech research at Morgan Stanley, said patient demand is likely to be vast, but some doctors have refused to administer aducanumab even if it gets approval. “Investors aren’t sure to understand what that dynamic will ultimately mean.”

He expects Biogen to reap $7bn worth of sales by 2030 while Bristow of UBS anticipates peak annual sales worth $18bn worldwide.

“It would be one of the biggest drugs in the industry,” said Bristow.

What happens if it is rejected?

Rejection of aducanumab will be a knock for people suffering from Alzheimer’s who have pinned their hopes for a slower mental decline on the drug.

More than 6m people in the US are living with the disease, according to the Alzheimer’s Association, and many conditions have worsened during the coronavirus pandemic as contact between loved ones was reduced in order to slow the spread of the virus.

Rejection will also be a heavy blow for Biogen, which has spent millions on the drug’s development and fallen behind in other areas. The company’s shares have fluctuated wildly following previous announcements about the drug.

“Aducanumab really hurt Biogen for a while because it was such an overwhelming focus of the company, they got behind in gene therapy [and] new neurodegenerative treatments,” said Tom Shrader, managing director of BTIG.

What will the FDA’s decision mean for other companies?

A green light from the FDA is likely to instil confidence in the amyloid hypothesis and boost investment in further studies. Eli Lilly is trialling donanemab, another drug which removes amyloids, and positive news for Biogen is likely to boost sentiment towards Lilly’s study.

Geoff Meacham, analyst at Bank of America, said a rejection “is not necessarily going to put a death nail in the coffin of the amyloid hypothesis” because Biogen’s controversial trials are difficult to compare to others’. Meanwhile, imaging technologies have progressed so patients can be more effectively screened to see whether they have amyloids in their brains in the first place. 

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Demna Gvasalia buffed up his supersized silhouettes to a glamorous sheen.

The Hacking Project between Gucci and Balenciaga rolls on, with Balenciaga’s Demna Gvasalia swapping Gs for Bs in the Florentine house’s iconic diamond monogram — and adding a Magritte-esque touch by gleefully vandalizing one weekender with the tag “This Is Not a Gucci Bag.”

The spring collection is a thought-provoking play on what is real and what isn’t, and where technology has messed with our heads. Artist Eliza Douglas, and clones of her, model all 44 looks for women and men in a gripping, yet disquieting runway video by Quentin Deronzier. Achieving the hyper-realistic clones involved teaching body doubles to walk like Douglas, and grafting her impassive face onto them with the latest digital tools so convincingly that Gvasalia confessed he couldn’t identify the real her from the deep fakes — and this is the woman who has opened or closed every Balenciaga show since he arrived at the French house in 2015.

According to Gvasalia, the clones are a critique on fashion’s obsession with trends and “hero” items, which diminishes individuality, while the hacks on Gucci were a giddy, Kering-approved commentary on counterfeiting and the don’t ask, don’t tell practice of appropriation so widespread in fashion.

Meanwhile, the extensive post-production technology used to create the video — involving planar tracking, rotoscoping, machine learning and 3D modeling — is the designer’s way of prompting people to think about our obsession with screens and the deluge of digital imagery we consume, rarely knowing if it’s been photoshopped, put through some filter or if it’s actually true.

Which left the stage for the Balenciaga clothes, all of which are 100 percent real and heightened expressions of Gvasalia’s obsessions — oversized silhouettes, puffers, hoodies, trenchcoats, floral dresses and tracksuits — this time all buffed up to relay a modern type of elegance exemplified by his sexy bustier and trousers, done up in sweatshirt material, and hulking down jackets with jutting, face-framing collars. The supersized fashions had a commanding presence, hovering somewhere between chic glamor and punk rebellion.

The show opened with what resembled mourning garb and gradually cheered itself up with candy-colored Crocs, a sweatshirt featuring the Simpsons wearing last season’s Balenciaga, clutch bags resembling fast-food packaging, and a fishtail finale gown that’s a ringer for the one Divine wore in “Pink Flamingos” in 1972, though done up in stretch velvet.

“It’s kind of a Demna wardrobe,” Gvasalia shrugged.

And it’s — fingers crossed — his last hurrah with haute technology, which became integral to his creative expression during the pandemic. He’s had a blast making fashion films and even a video game, but the digital realm is losing its charm. Balenciaga is banking on a live show at its restored Avenue George V salons during couture week in Paris, marking Gvasalia’s first stab at high fashion and the brand’s comeback to couture after a 53-year absence.

The acquisition of the medical-supply company, valued at more than $30 billion, is the biggest LBO in more than a decade

The acquisition of Medline Industries Inc. that was agreed to over the weekend, the biggest leveraged buyout in more than a decade, serves as the clearest sign yet that the appetite for megadeals is rising as the pandemic eases and private-equity firms look to deploy mountains of cash.

Blackstone Group Inc., BX 0.95% Carlyle Group Inc. and Hellman & Friedman LLC said Saturday they struck a buyout deal that, according to people familiar with the matter, values the closely held medical-supply company at more than $30 billion—or around $34 billion including debt. That makes it the largest leveraged buyout since the 2007-08 financial crisis.

Merger-and-acquisition activity has been busy across the board so far this year, with a string of large tie-ups lately including Discovery Inc.’s $53 billion deal to combine with AT&T Inc.’s Warner Media arm and Canadian National Railway Co. outbidding a rival to buy Kansas City Southern. In the U.S., $1.24 trillion of deals have been reached in 2021, up more than fourfold compared with the same period last year when lockdowns crimped economic activity and acquisition volume, according to Dealogic.

But private-equity firms, tasked with putting over a trillion dollars to work, had largely shied away from the biggest deals—until now.

Big buyouts, which involve borrowing large amounts of money to amplify potential returns, all but disappeared after a number of the targets performed poorly or filed for bankruptcy in the wake of the financial crisis, weighed down by enormous sums of debt.

Between 2005 and 2007, private-equity firms sealed 18 deals valued at $10 billion or more, according to Dealogic. Since then, they had only struck 10, before Medline.

There had been signs firms were regaining their taste for big buyouts, as they approached targets including Japan’s Toshiba Corp. and Dutch telecommunications company Royal KPN NV. But until now no such deal had gotten over the finish line.

“This could be the transaction that opens up the floodgates,” said Dusty Philip, co-chairman of global M&A at Goldman Sachs Group Inc., which advised Medline. “You have ideal conditions for large LBOs: low interest rates, aggressive financing markets and a significant amount of dry powder.”

Indeed, buyout firms are now sitting on more than $1.6 trillion of unspent cash, according to data provider Preqin—and that doesn’t take into account the billions that big institutional investors are clamoring to invest directly in deals.

The fact that three private-equity firms came together—they are equal partners—harks back to an earlier era before the crisis, when so-called club deals were common. They fell out of favor as firms have generally preferred to form partnerships with their biggest investors, but have started to appear more lately in another sign that the scope for megabuyouts is increasing.

The Medline deal capped a rapid-fire sales process that kicked off just over two months ago, attracting a field of bidders that is a who’s who of the biggest buyout firms. The size was part of the appeal, giving the firms the ability to put large amounts of capital to work without having to worry about competition from strategic bidders because of antitrust concerns. In a sign of how hungry the firms were for the deal, senior executives from the bidders made pilgrimages to Medline’s suburban-Chicago headquarters to woo members of the family that founded the company.

The winners beat out a rival bid from the private-equity arm of the Canadian investing firm Brookfield Asset Management Inc. late Friday and signed the deal Saturday afternoon, the people said. The sales process had originally been expected to last several more weeks.

Based in Northfield, Ill., Medline is a little-known but major competitor in the field of medical equipment. It manufactures and distributes equipment and supplies used in hospitals, surgery centers, acute care and other medical facilities in more than 125 countries.

Medline’s vast product lineup includes surgical gowns, examination gloves and diagnostic equipment, as well as consumer-facing brands such as Curad bandages. It has some $17.5 billion in annual sales.

The brothers James and Jon Mills founded the company in 1966, taking it public in 1972 before buying back the shares five years later. Since 1997, James’s son Charlie has been Medline’s chief executive, working alongside President Andy Mills and Chief Operating Officer Jimmy Abrams, who is Andy’s brother-in-law.

The family would remain the single largest shareholder in the company after the buyout and the management team would remain in place, the company said. GIC Pte Ltd., Singapore’s sovereign-wealth fund, is also investing in the deal.

In addition to Goldman, BDT & Co. acted as financial adviser to Medline, and Wachtell, Lipton, Rosen & Katz was legal adviser. BofA Securities Inc., J.P. Morgan, Barclays, Morgan Stanley and Centerview Partners advised Blackstone, Carlyle and Hellman & Friedman. Simpson Thacher & Bartlett LLP was the group’s legal adviser.