Biogen Needs a New CEO. Here Are Some Options.

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Investors may have to wait for the name of the next Biogen CEO.

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Courtesy of Biogen

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Biogen kicked off a high-stakes guessing game earlier this month when it announced that its CEO Michelle Vonatsos would be leaving, after the company effectively threw the towel over its efforts to market its controversial Alzheimer’s disease therapy EduHelm. Dia: Who will be the next CEO of the company?

The executive who replaces Vounatos will inherit a large-cap biotech facing significant challenges: declining sales of key drugs, a disappointing denial of its EduHelm program, and a 34.5% drop in the stock price over the past two years. A period in which the S&P 500 is up 38.6%.

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Still, Biogen (ticker: BIIB) is one of a small group of large-cap biotechs with a high-profile perch for an executive willing to take on a challenge. This could mean an efficient merger and acquisition strategy, or an attempt to sell the company to a larger competitor.

In a note early Tuesday, RBC Capital Markets analyst Brian Abrahams offered a list of his top picks for Biogen’s next CEO, which most recently saw Alexion’s former CEO Pfizer (PFE) and a major Biopharma take on the biggies. Two CEOs of the biotech are involved. The executive who once ran Allergan among others.

“BIIB will be best served by a competent CEO in any major strategic” [business development] to revive the pipeline, or that could potentially reorganize the company’s portfolio to make it attractive to an acquirer, and to help re-energize the story and investor base at the end of the year. to seek a new leadership,” Abraham wrote.

Abraham suggested several potential CEOs who sold large biopharma companies, including Vlad Couric, currently CEO of Biohaven Pharmaceutical (BHVN), which Pfizer agreed to buy earlier this month for $11.6 billion Was. However, it looks like Couric won’t be available: Pfizer’s acquisition of BioHaven won’t kick off until next year, and Couric is currently set to lead a successor company that will continue to develop the drugs in BioHaven’s pipeline, Seven. Peptide drugs belonging to a different gene from calcitonin that Pfizer wants.

Another name on Abraham’s list is Amit Munshi, who headed Arena Pharmaceuticals, which Pfizer acquired this year for $6.7 billion. Arena developed a drug called atrassimod that is now expected to be a blockbuster for Pfizer; On Tuesday, Pfizer unveiled new promising data on two Phase 3 trials of the drug.

“We believe they have the experience and proven execution potential to take a critical look at BIIB,” Abrahams wrote.

Abraham also suggested Ludwig Huntson, CEO of Alexion when it was acquired by AstraZeneca (AZN) for $39 billion, and Brent Saunders, CEO of Allergan when it was acquired by AbbVie (ABBV) for $63 billion.

Abrahams enlisted several current pharmaceutical executives, including Anne White, who leads neuroscience at Eli Lilly (LLY) and is responsible for its Alzheimer’s therapy, dovanamab, which works similarly to Biogen’s EduHelm.

Another option cited by Abraham is Jeffrey Leiden, former CEO of Vertex (VRTX) and currently its executive chairman. Abraham wrote that Leiden “could be tapped by the BIIB’s more conservative leaning board, given his proven track record of changing companies,” but noted that he was “not sure” Leiden would want the job.

Other names on Abraham’s list include a former Biogen CFO named Paul Clancy and Alisha Alimo, the current president of Biogen. “We don’t necessarily expect someone to take the top seat within the organization and believe investors may find the internal hire less exciting,” Abrahams wrote.

Investors may have some time to wait. Biogen awaits data from phase III trials of lecanumab, another Alzheimer’s drug, expected this fall, which will be a catalyst for the stock. Abraham said he doesn’t necessarily think the company will do a pickup before announcing those data.

Write to josh [email protected]

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