BioArctic Shares Soar 27% on Alzheimer's Collaboration with Bristol Myers Squibb

Shares of Swedish biotech firm BioArctic AB soared by over 27% on Thursday following the announcement of a significant collaboration with U.S. pharmaceutical giant Bristol Myers Squibb (BMS).

BioArctic AB (publ) (STO:BIOA B) stock soared on Thursday after the Swedish biotech firm announced a major collaboration with U.S. pharmaceutical giant Bristol Myers Squibb (NYSE:BMY).

The partnership will center on two of BioArctic's next-generation Alzheimer's disease programs, BAN1503 and BAN2803.

Of particular note is the incorporation of BioArctic's cutting-edge brain transporter technology (BTT) in BAN2803.

According to RBC Capital Markets analysts, BTT is a potentially transformative method for targeting amyloid beta plaques in the brain, a key factor in Alzheimer's progression.

The collaboration will see BMS pay BioArctic an upfront sum of $100 million, with the possibility of an additional $1.25 billion in milestone payments if the projects achieve key developmental and commercial targets.

Furthermore, BioArctic is set to receive low double-digit royalties on future sales if the programs are successful in reaching the market.

This partnership is being seen as a major validation of BioArctic's technology, especially its BTT platform, which is designed to improve the delivery and safety profile of Alzheimer's treatments.

RBC analysts noted that while BioArctic's technology lags behind Roche's trontinemab by a few years, the backing of BMS could allow the company to accelerate the development of its programs and potentially offer a best-in-class solution.

One of BioArctic's major innovations is targeting pyroglutamate amyloid beta subtypes, which are highly prone to aggregation and contribute to the formation of harmful plaques in Alzheimer's patients.

RBC analysts believe that this focus, combined with the delivery advantages of the BTT platform, could give BioArctic treatments a competitive edge over existing therapies.

With BMS's resources and expertise now backing BioArctic's work, the company is poised to challenge larger players in the Alzheimer's treatment market.

BioArctic stock closed at SEK 170.00 on Thursday, reflecting a sharp increase in investor confidence.

RBC Capital Markets maintained its “Outperform” rating on the stock, setting a price target of SEK 340.00, citing the collaboration's potential to create long-term value.