UPDATE 2-Biogen discontinues experimental arthritis drug
(Adds analyst comment, stock price)
LOS ANGELES, Oct 9 (Reuters) - Biogen Idec Inc (BIIB.O) said on Thursday it will discontinue development of baminercept as a treatment for rheumatoid arthritis after the experimental drug failed to prove effective in a mid-stage trial.
Biogen said it will continue to analyze the study results and will submit the data for presentation at an upcoming medical meeting.
"Baminercept was not considered a growth driver for Biogen Idec; and therefore we do not expect this news to significantly impact the stock," BMO Capital Markets analyst Jason Zhang said in a research note.
He said baminercept accounted for 14 percent of the $207 million in increase in Biogen's 2007 research and development expense, but any savings from the program would easily be offset by increased costs for other projects.
Biogen will report third-quarter earnings on Oct. 21.
"We expect that the growth momentum seen in the last two quarters will likely slow down in the third quarter following the announcement of two new PML (progressive multifocal leukoencephalopathy) cases in early August," Zhang said, referring to the dangerous brain infection that has been linked to Biogen's multiple sclerosis drug Tysabri.
Biogen Idec shares, which fell 3.4 percent to close at $44.76 in regular trading on Nasdaq, were unchanged after hours. (Reporting by Deena Beasley, editing by Richard Chang and Andre Grenon)
