To The Moon

Blood tests for Alzheimer’s disease are becoming a hot topic. Detecting the abnormal protein ptau 217 in blood can diagnose Alzheimer’s with up to 90% accuracy. Although current clinical detection rates are lower, and no products have yet received FDA approval, the potential for this test is huge.

As technology advances, early screening and diagnosis of Alzheimer’s through blood tests could open up significant opportunities for drug companies with relevant treatments, such as $Eli Lilly(LLY)$ and $Biogen(BIIB)$.

1. $Eli Lilly(LLY)$

Eli Lilly is a global healthcare giant with a market cap over $800 billion. Their hottest products right now are the weight loss and diabetes drugs, Zepbound and Mounjaro, which have investors excited. However, their recently FDA-approved early Alzheimer’s treatment, Kisunla, also has enormous potential.

Clinical trials show Kisunla can slow cognitive decline by 35% compared to a placebo over 18 months. Analysts estimate its peak sales could hit $5 billion. With new blood tests potentially identifying more early-stage Alzheimer’s patients, Kisunla’s revenue potential could grow even more.

Lilly is also developing other Alzheimer’s treatments, which could provide further growth opportunities.Lilly’s strong financial position supports its focus on multiple growth avenues. Over the past four years, the company’s profits have never dropped below $5 billion.

2. $Biogen(BIIB)$

For investors looking for value, Biogen might be the better choice. They have two approved Alzheimer’s drugs: Leqembi and Aduhelm, though the latter has been discontinued.

In January 2023, the FDA approved Leqembi (lecanemab-irmb) for Alzheimer’s under accelerated approval. Recent studies suggest the best results come after three years of use. However, if treatment is stopped, the disease can worsen, implying patients might need lifelong treatment.

Plus, Leqembi requires administration every two weeks in a medical setting. Biogen, however, is working with partner Eisai to develop a monthly version that might get approval in January, and a weekly injection version for home use.

Biogen’s market cap is just $29 billion, with a P/E ratio of 13, significantly lower than Lilly’s 57. This makes Biogen more attractive for value investors. However, Biogen’s investment risks are higher, with growth heavily reliant on Alzheimer’s treatments. The company’s revenue has struggled, dropping 27% to $9.8 billion over the past three years.