Eli Lilly's new Alzheimer's drug Donanemab faces another setback! FDA once again delays its approval for market launch.

Eli Lilly's new drug for treating Alzheimer's disease, donanemab, has once again had its market approval timeline delayed by regulators.

On Friday, March 8th, according to the latest news from the U.S. Food and Drug Administration (FDA), the FDA decided to postpone the approval of the donanemab drug and will convene an external expert meeting to discuss the safety and efficacy of the drug. It is reported that this is the second time the drug has encountered regulatory approval delays.

Considering that Alzheimer's disease is a chronic condition affecting millions of people worldwide, and so far, there is no definitive cure, patients urgently need more treatment options. Whether Eli Lilly's donanemab can become a new hope for patients depends crucially on the evaluation by the expert committee and the final approval from the FDA.

The approval delay of this drug has impacted Eli Lilly's product line's market schedule. This event may affect the company's performance and stock price, so patients, doctors, and investors are closely monitoring the progress of this drug.

Currently, the specific discussion time of the expert committee and the exact date of the new drug's market launch have not been announced. However, Eli Lilly stated that the advisory committee meeting to discuss the drug may not take place for several months.

The drug's approval delay is mainly due to two reasons: FDA's cautious approach to new drug approvals and the occurrence of severe side effects with donanemab. However, Eli Lilly remains confident that this delay will not affect its financial performance in 2024.

The specific timeline for the approval decision is yet to be determined. Despite Eli Lilly's announcement last year of clinical trial data demonstrating the drug's safety and efficacy, the FDA decided to postpone its approval and take additional review steps. Following this announcement, Eli Lilly's stock price only slightly dropped to $775 in pre-market trading, while another pharmaceutical company related to Alzheimer's disease, Biogen, saw a 3% increase to $226 in pre-market trading.

Eli Lilly had originally expected the drug to receive FDA approval by the end of last year. In November last year, Eli Lilly announced that the FDA needed more time for review, thus delaying the approval decision to the first quarter of 2024. However, the FDA's decision on March 8th marked the drug's second encounter with regulatory approval delays, making the specific timeline of this approval highly anticipated.

Anne White, President of Eli Lilly's Neuroscience Division, commented on this:

"The approval delay came unexpectedly at the end of the review process for us. We will cooperate with the FDA's requirements to meet approval standards, and the company has made adequate preparations for the drug's market launch." "We don't have many details yet, but the agency has indicated that they will promptly take review actions. FDA will announce the meeting date of the advisory committee in the Federal Register, and these meetings usually take place about two months after the announcement." After the Advisory Committee meeting, we hope that the FDA can quickly make a decision on whether to approve the drug, so that we can provide it to patients.

Eli Lilly believes that this delay will not affect the financial performance in 2024.

The main reasons for the approval delay of the drug are twofold. Firstly, as a decision that can have far-reaching consequences, the FDA adopts a cautious approach to new drug approvals. Secondly, donanemab has previously shown severe side effects.

Before a drug is approved, the FDA typically holds an Advisory Committee meeting to rigorously review the drug, ensuring that any potential new drug on the market meets strict safety and efficacy standards to protect the public from potential risks. While the Advisory Committee's recommendations are not always strictly followed by the FDA, they are usually taken into consideration when deciding whether to approve a drug.

Therefore, although it may pose a challenge for drug manufacturers, this additional review step is crucial for the well-being of patients. For example, the Alzheimer's drug Leqembi, jointly developed by Eisai and Biogen, was approved and launched last year, following a similar process to that of donanemab.

Howard Fillit, co-founder of the Alzheimer's Drug Discovery Foundation, stated that "conducting due diligence is a critical step before distributing drugs to patients."

Furthermore, the FDA's cautious approach to new Alzheimer's treatments is due to the drug's history of severe side effects.

According to data from the Alzheimer's Association, over 6 million Americans suffer from Alzheimer's disease, which typically affects the elderly and is characterized by symptoms such as memory loss and cognitive decline. Tau proteins and amyloid proteins are two closely related proteins associated with Alzheimer's disease, and their abnormal deposition is a key feature in the disease's mechanism. The treatment mechanism of donanemab mainly involves clearing amyloid proteins from the brain through monthly infusions.

Last year, Eli Lilly released clinical trial data proving the drug's safety and efficacy. The results showed that Donanemab demonstrated a certain degree of effectiveness in slowing down memory and cognitive decline, with an overall slowing rate ranging from 22% to 29%, comparable to the 27% slowing effect demonstrated by Biogen's Leqembi.

The study specifically pointed out that in Alzheimer's patients with low to moderate levels of tau proteins, donanemab significantly outperformed the placebo, with a progression inhibition rate of up to 35.1%, meeting the primary goal of the study and demonstrating the drug's potential value.

Unfortunately, this drug has shown severe side effects, including brain swelling and bleeding. In the treatment group, 24% of patients experienced brain swelling, and additionally, 31% of patients receiving donanemab treatment experienced brain bleeding, leading to the deaths of three patients receiving treatment. In comparison, the incidence of these symptoms in patients receiving a placebo treatment was around 14%. The serious side effects have raised concerns about the safety of this drug by the FDA, which also plans to review the impact of Tau protein closely related to the progression of Alzheimer's disease. Considering that over 6 million Americans are affected by this disease, FDA's cautious evaluation is crucial as it is a decision that could have far-reaching implications. Therefore, even if the efficacy is proven, Eli Lilly may face challenges in commercializing Donanemab in the market.

However, Eli Lilly remains confident and has stated that this delay will not affect its financial forecast for 2024. Some analysts believe this optimism may be based on two factors: first, the company's confidence in Donanemab obtaining final FDA approval and successfully entering the market.

Second, the company has enough other product lines and businesses to support its financial expectations, so even with the delay in Donanemab's launch, it will not have a negative impact on the overall financial situation of the company. In February of this year, Eli Lilly predicted that with the momentum of its weight loss and diabetes drugs, its revenue in 2024 will reach between $40.4 billion and $41.6 billion.

Moreover, according to LSEG data, analysts expect that the sales of Donanemab will significantly increase in the coming years, from around $190 million in 2024 to approximately $837 million in 2025.