July 8 (Reuters) - Biogen Inc (BIIB.O) on Thursday said the U.S. Food and Drug Administration has narrowed use of its Alzheimer"s drug after the agency drew sharp criticism for its broad approval of the drug last month without proof of clear benefit against the disease. The new label for Biogen"s Aduhelm recommends that the treatment be used only for Alzheimer"s patients with mild cognitive impairment or mild dementia, the group that was tested in clinical trials. Biogen has estimated that around 1.5 million people in the United States would be eligible for Aduhelm, which is priced at $56,000 a year. Biogen"s shares were up nearly 3% in midday trading. The FDA"s initial approval of the drug for all Alzheimer"s patients has been widely criticized. Several members of the FDA"s advisory panel have resigned in protest over the decision. read more Wall Street analysts said they did not expect the label change to affect sales of the drug, and said it would instead help Biogen in securing reimbursement from health insurers. "It helps get people going on the right direction to refined and appropriately focused reimbursement, which helps get everyone comfortable that the right people will get the drug," said Jefferies analyst Michael Yee. Aduhelm, also known as aducanumab, was approved despite mixed clinical trial results. Some experts believe more proof is needed, while others are convinced that Aduhelm"s proven ability to clear amyloid brain plaques will benefit Alzheimer"s patients. The FDA approved the drug under a program allowing for biomarker, rather than clinical, evidence of effectiveness. Biogen said it had asked for an update to the label, a written information that accompanies a drug, after "dialogue with FDA, physicians and patient advocates." "The intent is to help prescribing physicians to engage with patients," Biogen said in a statement. The new label also says there is no safety or effectiveness data on initiating treatment at earlier or later stages of the disease. "We don’t expect the new Aduhelm label to impact peak sales for this product. Biogen has indicated all along that it will be promoting the use of the product for the population that was part of the clinical studies," SVB Leerink analyst Marc Goodman said in a research note. Analysts expect Aduhelm to reach annual sales of $4.8 billion by 2025, according to Refinitiv data. The Biogen drug - the first therapy designed to attack an underlying cause of Alzheimer"s - has been hailed by patient advocates and some neurologists eager for a treatment for the memory-robbing disease. Other doctors say clinical trial results were inconsistent and more proof is needed. (Corrects name of brokerage in paragraph 12 of July 8 story to "SVB Leerink", not "Leerink") Reporting by Manas Mishra in Bengaluru; Editing by Saumyadeb Chakrabarty, Shinjini Ganguli and Dan Grebler Our Standards: The Thomson Reuters Trust Principles.