FDA To Review Alzheimer's Brain Scan (LLY)

The research of Alzheimer's disease continues as new tests show great promise for the early diagnosis of the illness. According to the New York Times, the Food and Drug Administration will review a newly developed brain scan which purportedly can detect plaques indicative of Alzheimer's disease.

A critical component of the brain scan is a dye created by Avid Pharmaceuticals, a company owned by Eli Lilly (NYSE: LLY). Avid used 152 participants to perform brain scans and autopsies (upon death of course). The test sought to determine if the plaques on the brain scans would be present in the autopsy. Results were positive as the scans were confirmed accurate by the brain autopsies in 28 out of 29 people.

If the FDA gives its stamp of approval on the brain scan, it will likely be used as a critical diagnostic tool for Alzheimer's or serve to rule out the disease and allow doctors to consider other possible diagnoses.

Another study showed promise in detection of a protein fragment that composes the Alzheimer-specific plaque. Tests determined that blood levels in the protein were correlated to an increased risk of memory problems, according to the article. This test however, is not yet ready for public use.

You may consider taking a long position in Eli Lilly. If the FDA approves the brain scan, it might become a highly profitable medical service and subsequently, it may cause an increase in the stock price. Eli Lilly is currently trading at $34.79 and has a price-earnings ratio of 7.98.

Neither Benzinga nor its staff recommends that you buy, sell, or hold any security. We do not offer investment advice, personalized or otherwise. Benzinga recommends that you conduct your own due diligence and consult a certified financial professional for personalized advice about your financial situation.