Court reaffirms Tecfidera decision in Biogen's favor
- Biogen has cause to celebrate — a U.S. Court of Appeals has supported an earlier ruling that the company did not mislead investors about the effect the brain infection-related death of a patient taking Tecfidera (dimethyl fumarate) for multiple sclerosis had on the drug's sales.
- The class action lawsuit, led by GBR Group, was based on statements from 10 confidential witnesses and alleged that Biogen made more than 20 statements that failed to illustrate how the patient death and a subsequent warning from the Food and Drug Administration had a noteworthy impact on Tecfidera sales and the propensity for physicians to prescribe it. What's more, the plaintiffs claimed Biogen made those statements with scienter, meaning the company knew it was acting in the wrong.
- U.S. District Court for the District of Massachusetts previously shot down the plaintiff's amended complaint "for failure to meet the heightened pleading requirements of the Private Securities Litigation Reform Act ('PSLRA')." The appeals court reaffirmed that decision in a May 12 ruling.
Back in 2014, a patient treated with Biogen's Tecfidera died from pneumonia related to a viral brain infection called progressive multifocal leukoencephalopathy (PML). This had an immediate impact on the company's stock, pushing it down by 7%, and reduced sales of the drug.
Throughout 2015 and 2016, Biogen worked to streamline its enterprise, including terminating pipeline programs, reducing its workforce, closing a manufacturing facility in Cambridge, Mass. and spinning off its hemophilia business, in part to push more cash into Tecfidera sales and marketing. The company's new CEO, Michel Vounatsos, has been focused on rejuvenating the Tecfidera franchise, and its sales grew by 9% to $3.97 billion in 2016 compared with 2015.
Biogen is also continuing to collect real-world data on Tecfidera. Analyses of claims data have shown Tecfidera increases the time to first relapse in newly diagnosed and previously treated patients by 30% compared to teriflunomide in newly diagnosed patients and those previously treated with a disease-modifying therapy. Biogen's drug has also shown comparable efficacy to Novartis' Gilenya (fingolimod).
Safety issues aren't the only problem Tecfidera faces, however.
Former Turing Pharmaceuticals head Martin Shkreli, an unlikely pricing advocate, accused Biogen not too long ago of selling the treatment at higher prices in the U.S. compared with Europe. Shkreli is far from the only one to suggest that MS drug prices are too high.
Tecfidera has also undergone patent challenges from Danish drugmaker Forward Pharma and the Coalition for Affordable Drugs, both of which relate to Biogen's U.S. Patent No. 8,399,514, which covers the treatment of multiple sclerosis with 480 mg of dimethyl fumarate.
In January 2017, Biogen licensed all intellectual property to dimethyl fumarate from Forward Pharma for $1.25 billion, and in March 2017, the U.S. Patent and Trademark Office (USPTO) upheld Biogen's patent against the coalition and against Forward Pharma.
- United States Court of Appeals Statement
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