Biotech ETFs rallied Friday after Biogen (NasdaqGS: BIIB) announced successful results from its Alzheimer’s drug trial.
On Friday, large-cap biotechnology sector ETFs lead the charge. The iShares Nasdaq Biotechnology ETF (NasdaqGS: IBB) increased 3.2%, First Trust NYSE Arca Biotechnology Index Fund (NYSEArca: FBT) advanced 2.9% and VanEck Vectors Biotech ETF (NYSEArca: BBH) was 2.8% higher.
Meanwhile, BIIB shares surged 16.9% Friday. BIIB makes up 7.9% of IBB, 3.6% of FBT and 5.5% of BBH.
Biogen shares jumped Friday after the biotech firm and Eisai announced positive results from a Phase II study with BAN2401, an anti-amyloid beta protofibril antibody, in 856 patients with early Alzheimer’s disease, CNBC reports.
Biogen’s Overweight Rating
J.P. Morgan told clients the announcement is a good sign for the Biogen, reiterating an overweight rating for the company stock.
“Bigger picture, the data today adds to our confidence that there may indeed be a correlation between amyloid beta levels and cognitive functioning which, in our view, positions BIIB nicely for a potentially substantial wave of anticipation trade well ahead of the future binary aducanumab readouts (as we believe prevailing levels reflect minimal contribution from Alzheimer’s),” J.P. Morgan analyst said in a note.