Biogen (NASDAQ:BIIB) shares are trading lower in the early going Friday on the Medicare decision to restrict the coverage for the Food and Drug Adminisration-approved Alzheimer’s therapies that target Amyloid proteins in the brain.
The decision affects Aduhelm, a controversially approved Alzheimer’s therapy developed by Biogen and Eisai. Following the news, Needham has slashed the price target for Biogen by ~10% to $262 per share to imply a premium of ~27% to the last close.
One analyst argues that the decision would limit Aduhelm coverage to 1,000s range, indicating a significant restriction on its potential. Medicare first announced the proposal in January, and the analyst does not expect "a significant downside” to Biogen shares on the final decision as she notes that the stock already reflects the negative decision."
BIIB shares nicked ahead three cents to $211.67.
