This spreadsheet supplement corresponds to Exhibit 17 (Change in Biogen Valuation from Aducanumab Approval) from Case 623-046 "Biogen and the Aduhelm Melee."
Alzheimer's Disease is a devastating condition affecting millions of Americans. At this time, there is no cure. In 2021, Biogen's Aduhelm (aducanumab) received FDA approval under the accelerated approval pathway after a controversial approval process. This case explores Alzheimer's drug development, Aduhelm's clinical trials, FDA regulatory processes, the impact of the disease on payors and the broader healthcare system, the valuation of an Alzheimer's therapy, and the valuation of the company that produces it.
The case explores the intersection of capital allocation and shareholder activism in the biopharmaceutical industry. As many biopharma companies face looming patent expirations for key medicines, the case asks the question of whether investing in R&D and M&A is an imperative. Three biopharma companies have been under scrutiny by Elliott Management, one of the largest shareholder activists for various reasons. The range of investment options for biopharma companies are outlined, including investing in the business via R&D and M&A, and returning capital to shareholders via dividends and share repurchases. The uniqueness of large biopharma companies is reviewed including enviable profit margins, significant risk in R&D, questionable perpetuity value, and the pressure from shareholder activists to prudently deploy capital.
This case explores incentives for rare disease drug development by chronicling the role of the Spinal Muscular Atrophy (SMA) Foundation in forming strategic partnerships with the scientific research community and pharmaceutical developers to transform the trajectory of innovation for the disease. In the 17 years since its inception, the Spinal Muscular Atrophy (SMA) Foundation has helped transform SMA from an underfunded and poorly researched disease with no available treatments to one with three novel drugs approved by the Food and Drug Administration (FDA). While these therapies greatly improved the quality of life for many newly diagnosed patients, there was still a substantial portion of existing patients with unmet medical needs. Though many in the medical community, and even at the FDA, felt that SMA had been all but cured, the Foundation could not accept that their work was done until every patient had a treatment option.
The operating executives of Health and Benefits for Onex Partners, Megan Jackson Frye and Sam Camens, faced a challenge: Healthcare costs for employees of Onex's portfolio companies were continuing to rise above the consumer price index, reflecting broader trends across employer-sponsored health insurance in the U.S. Against this backdrop, Frye and Camens considered recommending that Onex's portfolio companies adopt value-based insurance design (VBID) principles to encourage employees to take high-value medications, for example by reducing copays for drugs managing diabetes or heart conditions. The case encourages students to put themselves in the shoes of Frye and Camens, who were grappling with evidence promoted by VBID's proponents on its potential to simultaneously improve employee health and curb employer costs. The case includes content on employer-provided health insurance in the U.S., as well as the consequences of cost-sharing on consumer behavior, health, and spending.
This Technical Note provides an introduction to Bayes' Rule and the statistical intuition that stems from it. In this note, we review the concepts that underlie Bayesian statistics, and we offer several simple mathematical examples to illustrate applications of Bayes' Rule. Instructors can assign this note either as a standalone reading to familiarize students with Bayesian statistics or as a supplement to accompany "Adaptive Platform Trials: The Clinical Trial of the Future?" (HBS Case No. 618-025). This case introduces the concept of an adaptive platform clinical trial, in which Bayesian statistical methods are used to expedite the investigation and regulatory approval of promising new therapies, such as cancer treatments.
For more than two decades, scientific advances have been driving profound changes in drug discovery and the drug industry itself. This case provides an overview and description of these technical and scientific advances. Written for the nonscientific reader, it may be used as companion reading for other case materials that require basic knowledge of the tools, techniques, and approaches used in the pharmaceutical and biotechnology industries.
In 2008, the state of Oregon had the budget to enroll 10,000 individuals into Medicaid. But officials knew that demand for Medicaid would be far greater. To give all poor, uninsured Oregonians a fair chance at receiving health insurance, the state established a lottery. In this simple lottery, renowned economists Katherine Baicker (at Harvard) and Amy Finkelstein (at MIT) found a rare and promising natural experiment. For decades, evidence on the impacts of health insurance on health was dominated by observational studies, which offered inconclusive answers. Under the Oregon lottery, some individuals were randomly selected from a waiting list to receive insurance while others were not, enabling comparison between the two groups, and in effect creating a randomized experiment. The Oregon health experiment, as it came to be known, would finally give economists and policymakers rigorous evidence on how access to health insurance affected the provision and use of health care, and ultimately, influenced the health and well-being of the population. By 2016, as part of the Patient Protection and Affordable Care Act, an estimated 25 million Americans were set to obtain health insurance, 12 million under Medicaid alone; driving home the need to find conclusive answers to these longstanding questions. Case number 2019.0
For nearly two decades, the leading evidence on hormone therapy was based on findings from observational studies like the Nurses' Health Study. In 1985, researchers at Nurses' Health Study confirmed that postmenopausal women who took estrogen had lower rates of heart disease than women who had never taken the hormone. These influential findings helped drive the surge in hormone prescriptions in the 1980s and 1990s. But in 2002, in a stunning turnaround, researchers for a randomized clinical trial called the Women's Health Initiative reported that hormone therapy, in fact, increased the risk of heart disease and stroke among postmenopausal women. Almost overnight, prescriptions for hormone treatment plummeted. For millions of women who were either abruptly taken off hormones or denied treatment, though, the feeling of confusion and anguish remained. At the heart of the hormone therapy controversy was the fact that two different research approaches-observational studies and randomized experiments-had arrived at diametrically opposite results, once again raising questions about what constituted reliable evidence. Case Number 2005.0