Alzheimer’s drugs: new medicines bring new hope to dementia battle

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Alzheimer’s disease has wrecked the hopes of countless drug researchers as thoroughly as the lives of its many sufferers. But persistence pays. Eli Lilly’s new drug donanemab significantly slows memory loss, the US company revealed this week. It is on track to win the second approval this year of a drug capable of altering the course of the disease. 

Donanemab removes a toxic protein called amyloid. This partly vindicates scientists who believe countering amyloid is key to treating Alzheimer’s. The advance is shared with a similar drug, lecanemab, made by US biotech Biogen and Japan’s Eisai.

It paves the way for a whole new class of treatments for dementia, rife among the ageing populations of the developed world.

Neither drug has a clear edge. Patients receive infusions of donanemab every four weeks, half as often as for lecanemab. They can be taken off the drug if scans show amyloid “plaques” on the brain have cleared.

Safety is a worry for both drugs. There were three suspected treatment-related deaths in each study. 

The potential of Eli Lilly’s Alzheimer’s drug has helped raise its share valuation. The stock trades at 49 times forward earnings, double where it was three years ago. But that has largely been fuelled by high expectations for its diabetes and obesity drugs, which account for almost 60 per cent of the drugmaker’s net present value, according to Berenberg. Even assuming peak sales for donanemab of $8bn, Lilly’s Alzheimer’s pipeline represents only 7 per cent of total NPV.

The stakes are higher for Biogen and Eisai, given their smaller sizes. When encouraging trial results for lecanemab were released in September, Biogen’s shares rose almost 45 per cent, while Eisai’s climbed 17 per cent. The US list price for lecanemab, called Leqembi, is $26,500 a year. Analysts expect Eisai and Biogen to split sales of $7.8bn and operating profits of $5.2bn in 2030, according to Visible Alpha.

These promising trial results will not end the scientific debate over Alzheimer’s. The amyloid protein is unlikely to be the only cause of the disease.

Still, the new drugs further validate pharmaceutical research following new weight-loss medicines and Covid-19 vaccines. Their significance exceeds their modest clinical benefits. Better treatments will supersede them. 

Lex is the FT’s concise daily investment column. Expert writers in four global financial centres provide informed, timely opinions on capital trends and big businesses. Click to explore