Biogen, Elan Report Another Death During Drug Trial

Drug makers Biogen Idec Inc. and Elan Corp. said Wednesday that a rare and often fatal disease had been diagnosed in a third patient receiving their suspended multiple sclerosis drug Tysabri.

Shares of Cambridge, Mass.-based Biogen fell 11% to $34 in after-hours trading on Nasdaq. U.S.-traded shares of Dublin, Ireland-based Elan slid 46% to $3.75 after hours.

The companies suspended sales of Tysabri last month after one patient died of progressive multifocal leukoencephalopathy, or PML, during a clinical trial of Tysabri in combination with Avonex, Biogen’s older multiple sclerosis drug. The disease was later confirmed in a second patient.

The companies said the latest diagnosis was in a patient participating in a trial of Tysabri as a treatment for Crohn’s disease who died in December 2003. The patient had been mistakenly diagnosed with brain cancer.

“This is bad. And it’s bad because this was a patient who was not evidently on Avonex,” said Alexander Hittle of A.G. Edwards. “The best hope for the drug was that [the PML cases were] in some way the result of a combination of Tysabri with Avonex, and Tysabri could be brought back onto market as a stand-alone therapy. This is going to make it very tough for them to get Tysabri back onto the market.”

Biogen and Elan said their evaluation of Tysabri’s safety was continuing, involving assessment of about 3,000 clinical trial patients. Results of the evaluation will be discussed with regulatory agencies to determine the drug’s future commercial availability, the companies said.

Biogen spokesman Jose Juves said the safety review was “going to take months.”

A Food and Drug Administration spokesman said, “We will carefully review this new information as part of our assessment of this drug.”

Tysabri had been expected to be an important future growth driver for Biogen and was seen as crucial to Elan’s fortunes. The drug had been expected to generate sales of more than $1 billion a year.