Bragar Eagel & Squire, PC reminds investors

NEW YORK, June 1, 2024 (GLOBE NEWSWIRE) — Bragar Eagel & Squire, PC, a nationally recognized shareholder rights law firm, reminds investors that a class action lawsuit has been filed against Biogen Inc. (“Biogen” or the “Company”) (NASDAQ: BIIB) in the U.S. District Court for the District of Colorado on behalf of all persons and entities who purchased or otherwise acquired Biogen securities between February 3, 2022 and February 13, 2024, both dates inclusive (the “Class Period”). Investors have until July 22, 2024 to request that the Court appoint them as lead plaintiff in the lawsuit.

Click here to take part in the promotion.

Biogen is a global biopharmaceutical company that discovers, develops and delivers therapies to people with serious and complex diseases around the world. The company has operations in several countries in North and South America, Europe and Asia.

Biogen’s products include Leqembi and Aduhelm for the treatment of Alzheimer’s disease (“AD”), as well as various drugs for the treatment of multiple sclerosis (“MS”). Sales of its MS-related products have historically accounted for the majority of the Company’s product revenues. However, in recent years, increasing competition from generic biosimilars of Biogen’s MS-related products has slowed the sales growth of these products and resulted in declining revenues. As a result, the Company has increasingly focused on developing new products to increase its revenues. Because AD-related treatments represented a lucrative market for Biogen, the Company’s AD-related products were particularly important to Defendants and investors throughout the Class Period.

In 2021, Biogen suffered a major setback in the company’s development of Alzheimer’s treatments. It was embroiled in controversy after investigative reports revealed that the company may have engaged in inappropriate communications with U.S. Food and Drug Administration (“FDA”) officials to obtain regulatory approval of Aduhelm to treat Alzheimer’s, despite concerns about the drug’s safety and efficacy, among other things. Biogen and FDA’s communications and conduct have been the subject of investigations by the U.S. Federal Trade Commission, the U.S. Securities and Exchange Commission (“SEC”), several congressional committees, and the U.S. Department of Health and Human Services’ Office of the Inspector General.

The previous investigations were not the only source of controversy for Biogen. Separately, in 2022, the U.S. Department of Justice (“DOJ”) announced that Biogen had agreed to pay $900 million to settle allegations that the company caused the filing of false claims with Medicare and Medicaid by paying bribes to doctors to induce them to prescribe the company’s MS-related drugs.

Following these controversies, Biogen launched a campaign to supposedly improve its transparency, corporate governance, and compliance controls and procedures. Among other things, the company replaced its Chief Executive Officer (“CEO”) in November 2022 and has since released compliance, corporate responsibility, and environmental, social, and governance reports touting the company’s supposedly improved compliance and governance practices.

In addition, the controversy surrounding Aduhelm’s regulatory approval has, at least in part, prevented the drug from gaining a foothold in the lucrative Alzheimer’s disease treatment market. Accordingly, defendants and investors have been particularly focused on the launch of the Company’s product Leqembi, which was developed in collaboration with Eisai Co., Ltd. (“Eisai”) and received FDA approval as a treatment for Alzheimer’s disease in 2023. Biogen and Eisai have set a goal of treating 10,000 patients with Leqembi by the end of March 2024.

In February 2023, Biogen provided guidance for non-GAAP diluted earnings per share (“EPS”) in a range of $15.00 to $16.00 per share for the full year (“FY”) 2023 and reiterated that guidance over several quarters.

Then, in July 2023, Biogen announced that it would acquire Reata Pharmaceuticals, Inc. (“Reata”) for $172.50 per share in cash, representing an enterprise value of approximately $7.3 billion (the “Reata Acquisition”). The Reata Acquisition represented another important opportunity for Biogen to strengthen its product portfolio and offset declining sales of MS-related treatments by acquiring Reata’s drug Skyclarys, which was the only treatment approved in the United States for patients with Friedreich’s ataxia. Biogen stated that the Reata Acquisition would be only “slightly” dilutive to Biogen’s 2023 non-GAAP diluted earnings per share.

The complaint alleges that throughout the Class Period, Defendants made materially false and misleading statements about the Company’s business, operations and compliance policies. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Biogen exaggerated its efforts to improve transparency, corporate governance and compliance controls and procedures and the effectiveness of those controls and procedures; (ii) Biogen accordingly maintained inadequate compliance controls and procedures in connection with its foreign operations; (iii) Biogen and/or its employees acted unlawfully or otherwise improperly in several countries; (iv) thereby subjecting the Company to increased risk of governmental and/or regulatory scrutiny and enforcement actions, as well as significant legal, financial and reputational damage; (v) Biogen exaggerated the strength of its AD-related product portfolio, including the Company’s and Eisai’s efforts and success in bringing Leqembi to market and providing access to it; (vi) Biogen also downplayed the negative impact the Reata acquisition would have on its fiscal 2023 diluted non-GAAP earnings per share (EPS); (vii) all of the foregoing would likely have a material adverse effect on Biogen’s 2023 results; and (viii) as a result, the Company’s public statements were materially false and misleading at all relevant times.

On November 8, 2023, Biogen announced its third quarter 2023 results, including negatively revised FY 2023 non-GAAP diluted earnings per share guidance in a range of $14.50 to $15.00 per share, significantly below the prior FY 2023 non-GAAP diluted earnings per share guidance of $15.00 to $16.00 per share, and cited approximately $0.75 of dilution from the Reata acquisition.

On this news, Biogen’s stock price fell $13.92 per share, or 5.67%, to close at $231.69 per share on November 8, 2023.

On January 8, 2024, Biogen CEO Christopher A. Viehbacher (“Viehbacher”) attended JP Morgan’s 42nd Annual Healthcare Conference. During his speech at the conference, Defendant Viehbacher discussed the challenges of bringing Leqembi to market and retracted earlier expectations that 10,000 patients would be taking the drug by the end of March 2024.

As the market digested this news, Biogen’s stock price fell $10.77 per share, or 4.17%, over three consecutive trading days, closing at $247.21 per share on January 11, 2024.

On January 31, 2024, Biogen announced that it was discontinuing development and commercialization of Aduhelm and “recorded a one-time charge of approximately $60 million related to program completion costs in the fourth quarter of 2023.”

On February 6, 2024, news reports emerged that Eisai was facing challenges in bringing Leqembi to market and that only 2,000 patients had been given the drug in the United States.

After the market fully digested this news, Biogen’s stock price fell $5.01 per share, or 2.04%, to close at $240.54 per share on February 7, 2024.

Then, on February 13, 2024, Biogen issued a press release announcing fourth quarter (“Q4”) and fiscal year 2023 results. This included non-GAAP earnings per share (EPS) of $2.95 for the fourth quarter, missing consensus estimates by $0.23, and revenue of $2.4 billion for the fourth quarter, missing consensus estimates by $60 million and representing a year-over-year decrease of 5.5%. The company disclosed that fourth quarter diluted earnings per share (EPS) “were negatively impacted by $0.35 due to previously announced closing costs for ADUHELM.” In addition, in a subsequent conference call to discuss these results with investors and analysts, defendant Viehbacher confirmed that “we currently have approximately 2,000 patients on (Leqembi)” and that “we have indications that there are approximately 3,800 patients in the registry as of last week” – far from the target of 10,000 patients set by the company and Eisai for the end of the following month.

The disappointing results surprised both investors and analysts and led to numerous downgrades by major financial institutions as well as a flood of negative press coverage of these results.

As a result of these developments, Biogen’s stock price fell $18.09 per share, or 7.39%, to close at $226.65 per share on February 13, 2024.

Finally, on February 14, 2024, Biogen announced in a filing with the SEC that it had received a subpoena from the DOJ “requesting information about (Biogen’s) operations in several foreign countries” and that “the Company is also providing the SEC with information about (its) operations in several foreign countries.”

On this news, Biogen’s stock price fell $5.91 per share, or 2.61%, to close at $220.74 per share on February 14, 2024.

If you purchased or otherwise acquired Biogen stock and suffered a loss, are a long-term shareholder, have information, would like to learn more about these claims, or have any questions about this announcement or your rights or interests with respect to these matters, please contact Brandon Walker or Marion Passmore by email at [email protected], by phone at (212) 355-4648, or by completing this contact form. There is no cost or obligation to you.

About Bragar Eagel & Squire, PC:

Bragar Eagel & Squire, PC is a nationally recognized law firm with offices in New York, California and South Carolina. The firm represents individual and institutional investors in commercial, securities, derivatives and other complex litigation in state and federal courts across the country. For more information about the firm, visit www.bespc.com. Attorney advertising. Past results do not guarantee similar results.

Contact information:

Bragar Eagle & Squire, PC
Brandon Walker, Esq.

Marion Passmore, Esq.
(212) 355-4648
[email protected]
www.bespc.com