By Frances Bishopp

With approximately 30,000 patients worldwide on its multiple sclerosis drug, Avonex, Biogen Inc. said the company continues to gain momentum, ending the second quarter of 1997 with sales of the product at $56.4 million, up $3.8 million from the first quarter of 1997.

Biogen's net income in the second quarter of 1997 was $20 million, or $.26 cents a share, a considerable jump from the second quarter of 1996, when the company reported a net loss of $9 million, or 13 cents per share, based on revenues of $45.4 million.

Biogen's revenues for the second quarter of 1997 were $97.6 million.

Biogen, of Cambridge, Mass., reported Avonex sales continue to meet expectations in the European market. The company said it is selling Avonex (beta interferon-1a) in countries that represent just over 50 percent of the potential market and anticipates pricing and reimbursement approvals shortly in France, Italy, The Netherlands and Spain, which, together with the countries in which the product is sold, represent 85 percent of the potential European market.

Peter Drake, an analyst with Vector Securities International Inc., of Deerfield, Ill., said he expects inflow of more than $15 million in European revenues from Avonex in the second half of the year.

With one of the top management teams in the sector in charge of one of the best drugs in the sector, Biogen should be a core holding in any biotechnology portfolio, Drake said.

Avonex was approved in May 1996.

Biogen's agenda, according to a prepared statement included in its fiscal report, includes educating physicians on the approval and use of Avonex earlier in the multiple sclerosis disease process than the current standard, extending its geographic reach through approvals in new markets and sponsoring clinical trials designed to identify new indications for Avonex.

Avonex competes with two other multiple sclerosis drugs: Betaseron, sold by Berlex Laboratories Inc., of Wayne, N.J., and made by Chiron Corp., of Emeryville, Calif.; and Copaxone, made by Teva Industries Inc., of Jerusalem, and marketed in the U.S. by Teva Marion Partners, a joint venture between Teva and Hoechst Marion Roussel, of Frankfurt, Germany.

Betaseron (beta interferon-1b) has been on the market since 1993 and is nearly the same molecule as Avonex. Copaxone, an amino acid peptide fragment derived from myelin basic protein, was launched this year.

Besides Avonex, which is sold for relapsing forms of multiple sclerosis, Biogen's revenues are royalties from sales of products licensed to pharmaceutical firms, including alpha interferon and hepatitis B vaccines and diagnostic products.

Biogen's pipeline includes: CVT-124, an adenosine A-receptor antagonist, which is in Phase II trials for congestive heart failure; LFA3TIP, a T cell inhibitor, in Phase II testing for severe psoriasis; Gelsolin, a recombinant form of a natural actin-severing agent thought to work by reducing airway mucus viscosity in cystic fibrosis patients; and Avonex, for treatment of glioma.

In addition, the company is in Phase I trials with a CD40 ligand antibody, designed to inhibit B cells as a potential therapy for inflammatory and autoimmune diseases, and is in preclinical studies with OP-1, a recombinant osteogenic protein-1, believed to have production applications in renal disease.

OP-1 came to Biogen in a $122.5 million collaboration with Creative BioMolecules Inc. in 1996. Also, Biogen is developing a small molecule antagonist of VLA-4 for asthma. VLA-4 is a cell adhesion protein on the surface of white blood cells.

Biogen's research and development expenses for the second quarter of 1997 were $32 million, an increase from $29.3 million for the same period in 1996.

At the end of the second quarter of 1997, Biogen's royalty revenue was at $36 million, up approximately $1 million from the same period in 1996.

Drake said he expects Biogen to continue to be transaction-oriented in 1997, with the possibility of a late-stage deal occurring before the end of the year.

Biogen is collaborating with CV Therapeutics Inc., of Palo Alto, Calif., on development of CVT-124 for treatment of edema associated with congestive heart failure.

Biogen's stock (NASDAQ:BGEN) closed Friday at $35.50, up $0.438. *