BiiB.US (BIIB.US) shares were down more than 5% pre-market after its Alzheimer's drug was rejected by European regulators.

The European Medicines Agency's (EMA) Committee for Medicinal Products for Human Use has rejected Leqembi, a drug developed by Japan's Eisai and Biogen to treat Alzheimer's disease, a blow to a company seeking to expand sales in one of the world's largest drug markets. The drug, which was approved in the US last year, has been slowed by logistical issues. Biogen, which has been seeking to boost its market share with the drug, which it developed in partnership with Eisai, has been hit by a decline in sales of its main multiple sclerosis drug. Biogen's shares were down 5.48 per cent in pre-trading on Friday, while BioArctic, Eisai's partner in the Nordic region for commercialising Leqembi, fell 31 per cent in Europe, the biggest single-day drop since November 2020.

Eisai's drug has already been approved in several other countries, including Japan, China and Israel. This month, Eli Lilly's Alzheimer's treatment drug Aduhelm was approved in the US, becoming the second drug to slow the disease.

Abrahams, an analyst at Royal Bank of Canada Capital Markets, estimates that Europe accounts for about 20 per cent of Leqembi's potential market. Even if an appeal overturns the decision, he said, it would delay the launch in Europe.

"It's likely to slow down global uptake of the drug and the class in general," he said.