(Bloomberg) -- Biogen Inc. reported first-quarter profit that beat Wall Street’s expectations as the biotech giant’s new Alzheimer’s drug Leqembi gained traction and cost cuts took hold.

Adjusted earnings for the quarter were $3.67 a share, the Cambridge, Massachusetts-based company said Wednesday in a statement, while analysts surveyed by Bloomberg had foreseen $3.44. Leqembi sales of about $19 million were almost triple analysts’ average expectation, and Skyclarys, the company’s new drug for an inherited disease in children, also beat estimates.

The shares rose as much as 5.5% when New York markets opened, marking Biogen’s biggest intraday gain since January 2023. 

Biogen is seeking a boost from Leqembi, developed in partnership with Japan’s Eisai Co., as sales of its mainstay multiple sclerosis medications decline. The first drug shown to slow progression of Alzheimer’s, the mind-robbing disease that afflicts some 6 million Americans, Leqembi gained full US approval last year. While uptake has been slowed by logistical hurdles, doctors and hospitals are starting to get it to patients, Chief Executive Officer Christopher Viehbacher said.  

One hospital took three months to get approval to hire a nurse to help navigate patients, while another needed to put together a five-year business plan to be able to use infusion beds to administer the therapy, the CEO said in an interview. “They are overcoming all of these barriers and getting these processes in place,” he said.

Biogen’s rival in Alzheimer’s recently faced a setback. In March, Eli Lilly & Co. said its experimental drug for the disease would face further delays in gaining US approval.

Cost Cuts

Viehbacher, who took the helm at Biogen in late 2022, also cited cost control for the results. In July, Biogen said it would cut 1,000 jobs — more than 11% of its workforce — and reduce operating expenses by an additional $700 million by 2025.

Meanwhile, the company has sought treatments for rare diseases, agreeing last year to pay $7.3 billion for Reata Pharmaceuticals Inc., maker of Skyclarys, which has been cleared for sale in the US. It’s the first approved treatment for Friedreich’s ataxia, an inherited degenerative disease that can impair walking and coordination in children. 

Sales of the drug were $78 million in the quarter, while Wall Street analysts had foreseen $72 million.

Biogen has also partnered with Sage Therapeutics Inc. on Zurzuvae, the first pill for postpartum depression. Quarterly sales of that drug, which arrived in the US in December, were about $12 million, double the consensus estimate.

Biogen isn’t looking at any significant acquisitions this year, Viehbacher said. Instead, the company is interested in licensing drugs and collaborating with other companies to broaden its portfolio beyond neuroscience and into rare diseases and immunology. 

Quarterly revenue of $2.3 billion was roughly in line with analysts’ predictions. Biogen reaffirmed its outlook for adjusted earnings this year of $15 to $16 a share. 

(Updates shares in fourth paragraph.)

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