Things could get worse for Biogen

You probably heard about the clinical trial failure that took about $20 billion out of Biogen’s valuation last week. Now comes a make-or-break patent decision that could further darken the company’s fortunes.

Tecfidera, a multiple sclerosis drug that accounts for about one-third of Biogen’s revenue, wasn’t expected to lose patent protection until 2028. But Mylan is challenging the key intellectual property that keeps Tecfidera exclusive, and a court decision, expected in 2020, could introduce early generic competition for Biogen’s best-selling product.

A negative ruling would cut about $4 billion from Biogen’s valuation, according to EP Vantage. And that could be the blow that exposes the company to a low-ball buyout offer, ending Biogen’s 40-year run as an independent drug developer.