Eli Lilly jumps 10% after it says it will seek approval for its Alzheimer's drug following designation as a breakthrough therapy by the FDA

On the wall of the Lilly France unit of Eli Lilly and Co, near Strasbourg Thomson Reuters, is the logo of Lilly.Eli Lilly's stock rose 10% Thursday, after the company announced it would seek an expedited approval for its Alzheimer drug.Following phase two data, Donanemab was awarded a breakthrough therapy designation by the FDA.This move comes only weeks after Biogen was approved by the FDA for its Alzheimer's drug, despite critics about insufficient data.Subscribe to our daily newsletter 10 Things Before The Opening Bell.After the announcement that donanemab, its Alzheimer's drug candidate was being approved by FDA accelerated approval, Eli Lilly shares jumped 10%The news from the Indianapolis-based company comes as the FDA has designated the drug a breakthrough therapy. This will allow it to be approved quickly. Donanemab achieved its primary endpoint during a phase 2 trial earlier this year.Given that Biogen recently approved Aduhelm, a controversial Alzheimer’s treatment, investors are likely to be bullish about the possibility of Eli Lilly's Alzheimer’s drug candidate being approved by the FDA. Many, including scientists who were part of an FDA panel that reviewed the drug, argued that Biogen's data was not sufficient to be approved.Eli Lilly stated that it would file for an accelerated approval of donanemab in the latter part of this year, even though the drug's phase 3 trial is still ongoing. One Wall Street analyst was shocked by Eli Lilly's announcement.Terence Flynn, an analyst at Goldman Sachs, stated in a Thursday note that Eli Lilly's request for accelerated approval of the drug was "ahead of our expectations" because he believed the FDA could have requested more safety data from the Phase 3 trial.Flynn said that donanemab approval could raise questions about the near-term market share of Biogen's Aduhelm. Biogen shares fell as high as 7% during Thursday trades.Goldman Sachs rates Eli Lilly a Buy with $270 price targets. This represents potential upside of 24% after Wednesday's close.Markets Insider