Biogen Idec shares rise on drug sales outlook

Shares rose $1.27, or 2.6 percent, to $51.04 in afternoon trading. Meanwhile, the Dow Jones Industrial average and other indexes plummeted as the House failed to pass a $700 billion financial bailout package for the financial sector.

Wall Street has remained positive on the outlook for Biogen's multiple sclerosis drug Tysabri, despite potential safety issues. Tysabri was pulled from the market in 2005 after being linked to a rare brain disease called progressive multifocal leukoencephalopathy, or PML. The drug was reintroduced in mid-2006 under restricted sales conditions. About 32,000 patients are on Tysabri worldwide, with 17,800 in the U.S., and the company hopes to eventually get 100,000 patients worldwide.

In July, the company reported two new cases of PML. Still, analysts have been pointing to sales estimates from pharmaceutical data company IMS Health showing gains for both Tysabri and the multiple sclerosis drug Avonex.

"We do concede that IMS sales tracking for Tysabri is highly variable, but are encouraged by the August trends," Citi analyst Dr. Yaron Werber said in a note to investors.

He said a projected sales of about $115 million for the quarter for Tysabri are consistent with his $114 million estimate. Based on discussions with physicians, he said, the vast majority are not planning on changing usage of Tysabri.

Meanwhile, sales of Avonex seem to tracking at about $316 million, compared with his estimate of $332 million, but an average estimate of $308 million.

Werber reaffirmed a "Hold" rating on the Cambridge, Mass.-based company.