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Lilly (LLY) Stock Down as FDA Delays Decision on Donanemab
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Eli Lilly and Company’s (LLY - Free Report) stock declined 2.3% on Friday after it announced that an FDA decision on its regulatory filing for an important pipeline candidate, donanemab, its anti-amyloid beta antibody for early symptomatic Alzheimer's disease, will be delayed.
Donanemab biologics license application (BLA) was based on data from the TRAILBLAZER-ALZ 2 confirmatory phase III study. Lilly said an FDA advisory committee will be convened to discuss data from the TRAILBLAZER-ALZ 2 study to get more information about donanemab’s safety and effectiveness. A date for the meeting of the Peripheral and Central Nervous System Drugs Advisory Committee has not been set yet. The FDA decision on donanemab was expected in the first quarter of 2024, which has now been postponed.
Lilly’s stock has skyrocketed 134.9% in the past year compared with an increase of 34.0% for the industry.
Image Source: Zacks Investment Research
Data from the TRAILBLAZER-ALZ 2 phase III study showed that treatment with donanemab significantly slowed cognitive and functional decline in early symptomatic Alzheimer's disease patients. Of the participants, 47% treated with donanemab had no clinical progression in the first year (defined as no decline in CDR-SB, a key measure of disease severity) compared with 29% on placebo. In patients with the earliest stage of the disease, an even greater benefit was observed, with a 60% slowing of decline compared with placebo.
As far as the safety profile of the candidates was concerned, the incidence of total amyloid-related imaging abnormalities (ARIA), a brain swelling side effect associated with anti-amyloid antibodies, was 24% in the donanemab arm. ARIA-H (microhemorrhages or superficial siderosis) occurred in 31.4% of donanemab-treated patients versus 13.6% in the placebo group.
We remind investors that in January last year, the FDA issued a complete response letter (CRL) to its BLA seeking accelerated approval for donanemab. The BLA was based on data from the phase II TRAILBLAZER-ALZ study. The FDA rejected the BLA as it believed the accelerated approval submission included data for only a limited number of patients. Lilly later re-filed the BLA and is now seeking traditional approval based on data from the TRAILBLAZER-ALZ 2 study.
It is expected that anti-amyloid beta antibodies have the potential to show some efficacy in early symptomatic Alzheimer’s patients. Two FDA-approved amyloid plaque-targeting therapies are Biogen (BIIB - Free Report) and Japan’s Eisai’s Leqembi (lecanemab) and Aduhelm. Leqembi gained full approval from the FDA for early Alzheimer’s disease in the United States and broad reimbursement from The Centers for Medicare & Medicaid Services in July 2023. Though Leqembi sales were slow in 2023, Biogen/Eisai expects the same to start growing from 2024.
Biogen/Eisai’s controversial medicine, Aduhelm, was approved by the FDA in 2021. However, in January 2024, Biogen discontinued the development and commercialization of Aduhelm as the drug failed to generate any significant sales due to a lack of access to Medicare beneficiaries. Biogen’s stock gained 1.8% on the FDA’s delayed decision on donanemab.
In the past 60 days, estimates for GSK’s 2024 earnings per share have improved from $3.87 to $4.03 while that for 2025 has increased from $4.20 per share to $4.39. In the past year, shares of GSK have risen 28.7%.
Earnings of GSK beat estimates in three of the last four quarters while missing the same once. GSK delivered a four-quarter average earnings surprise of 7.59%.
In the past 60 days, 2024 estimates for Vanda Pharmaceuticals have narrowed from a loss of 46 cents to earnings of 1 cent. In 2025, loss estimates have narrowed from 94 cents to 48 cents per share in the past 60 days. In the past year, shares of VNDA have declined 37.7%.
Vanda Pharmaceuticals delivered a three-quarter average earnings surprise of 92.88%.
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Lilly (LLY) Stock Down as FDA Delays Decision on Donanemab
Eli Lilly and Company’s (LLY - Free Report) stock declined 2.3% on Friday after it announced that an FDA decision on its regulatory filing for an important pipeline candidate, donanemab, its anti-amyloid beta antibody for early symptomatic Alzheimer's disease, will be delayed.
Donanemab biologics license application (BLA) was based on data from the TRAILBLAZER-ALZ 2 confirmatory phase III study. Lilly said an FDA advisory committee will be convened to discuss data from the TRAILBLAZER-ALZ 2 study to get more information about donanemab’s safety and effectiveness. A date for the meeting of the Peripheral and Central Nervous System Drugs Advisory Committee has not been set yet. The FDA decision on donanemab was expected in the first quarter of 2024, which has now been postponed.
Lilly’s stock has skyrocketed 134.9% in the past year compared with an increase of 34.0% for the industry.
Image Source: Zacks Investment Research
Data from the TRAILBLAZER-ALZ 2 phase III study showed that treatment with donanemab significantly slowed cognitive and functional decline in early symptomatic Alzheimer's disease patients. Of the participants, 47% treated with donanemab had no clinical progression in the first year (defined as no decline in CDR-SB, a key measure of disease severity) compared with 29% on placebo. In patients with the earliest stage of the disease, an even greater benefit was observed, with a 60% slowing of decline compared with placebo.
As far as the safety profile of the candidates was concerned, the incidence of total amyloid-related imaging abnormalities (ARIA), a brain swelling side effect associated with anti-amyloid antibodies, was 24% in the donanemab arm. ARIA-H (microhemorrhages or superficial siderosis) occurred in 31.4% of donanemab-treated patients versus 13.6% in the placebo group.
We remind investors that in January last year, the FDA issued a complete response letter (CRL) to its BLA seeking accelerated approval for donanemab. The BLA was based on data from the phase II TRAILBLAZER-ALZ study. The FDA rejected the BLA as it believed the accelerated approval submission included data for only a limited number of patients. Lilly later re-filed the BLA and is now seeking traditional approval based on data from the TRAILBLAZER-ALZ 2 study.
It is expected that anti-amyloid beta antibodies have the potential to show some efficacy in early symptomatic Alzheimer’s patients. Two FDA-approved amyloid plaque-targeting therapies are Biogen (BIIB - Free Report) and Japan’s Eisai’s Leqembi (lecanemab) and Aduhelm. Leqembi gained full approval from the FDA for early Alzheimer’s disease in the United States and broad reimbursement from The Centers for Medicare & Medicaid Services in July 2023. Though Leqembi sales were slow in 2023, Biogen/Eisai expects the same to start growing from 2024.
Biogen/Eisai’s controversial medicine, Aduhelm, was approved by the FDA in 2021. However, in January 2024, Biogen discontinued the development and commercialization of Aduhelm as the drug failed to generate any significant sales due to a lack of access to Medicare beneficiaries. Biogen’s stock gained 1.8% on the FDA’s delayed decision on donanemab.
Zacks Rank & Stocks to Consider
Lilly currently has a Zacks Rank #3 (Hold).
Eli Lilly and Company Price and Consensus
Eli Lilly and Company price-consensus-chart | Eli Lilly and Company Quote
Some better-ranked stocks in the healthcare sector are Vanda Pharmaceuticals (VNDA - Free Report) and GSK, plc (GSK - Free Report) , both with a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
In the past 60 days, estimates for GSK’s 2024 earnings per share have improved from $3.87 to $4.03 while that for 2025 has increased from $4.20 per share to $4.39. In the past year, shares of GSK have risen 28.7%.
Earnings of GSK beat estimates in three of the last four quarters while missing the same once. GSK delivered a four-quarter average earnings surprise of 7.59%.
In the past 60 days, 2024 estimates for Vanda Pharmaceuticals have narrowed from a loss of 46 cents to earnings of 1 cent. In 2025, loss estimates have narrowed from 94 cents to 48 cents per share in the past 60 days. In the past year, shares of VNDA have declined 37.7%.
Vanda Pharmaceuticals delivered a three-quarter average earnings surprise of 92.88%.