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(Bloomberg) -- Investors seeking the next obesity-like market opportunity will be closely watching developments related to treatments for Alzheimer’s disease in 2025.
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Companies including Biogen Inc. and Eli Lilly & Co. have spent billions of dollars on developing potential treatments, while others including Novo Nordisk A/S and Roche AG are also investigating the brain-destroying disease. Any breakthroughs in trials or drug approvals could have a big impact on share prices as investors factor in potential sales for a market which Bloomberg Intelligence estimates could reach $13 billion by 2030.
“The opportunity remains huge,” said Chris Eccles, a portfolio manager at AXA Investment Managers. “If we get a strong disease-modifying drug and very positive clinical trials, numbers can go back in models and forecasts can be revised upwards quite significantly, quite quickly.”
Firms developing Alzheimer’s drugs have already seen big peaks and troughs. Biogen shares soared 44% on a single day in November 2020 after news that an experimental drug appeared to be effective, before plunging days later after failing to get support from a panel of Food and Drug Administration advisers. Despite getting approval the following year, Biogen ultimately ditched the drug after years of debate over its efficacy. Many other drugs have also failed.
Two of the newest drugs to treat the disease are currently available in the US. Lecanemab, from Biogen and Japanese partner Eisai Co., is sold under the brand name Leqembi, and donanemab from Eli Lilly is branded as Kisunla. Both drugs work by reducing the brain amyloid levels in patients in the early stages of Alzheimer’s, and act to slow the disease. Still, they don’t stop or reverse it, while both treatments have side effects that include brain bleeding and brain swelling.
Read: What You Should Know About Newest Alzheimer’s Drugs: QuickTake
“It could be a year where we also see a bit more clarity in terms of traction for the drugs that are approved so far,” said Gregoire Biollaz, senior investment manager at Pictet Asset Management.
Here are some of the stocks to watch in 2025:
Biogen and Eisai
Patients currently on Leqembi take it as an infusion, though Biogen and Eisai have also developed a version that can be administered at home. In focus for investors in 2025 will be whether the injectable formulation wins regulatory approval, which would mean patients won’t have to travel for treatment.