Amgen 2Q Earnings Beat, Raises Guidance, Denosumab Deal Print
Monday, 27 July 2009 16:21

Amgen (NASDAQ:AMGN) reported adjusted earnings per share (EPS) of $1.29 for 2Q09, an increase of 13% compared to $1.14 for the 2Q08. Adjusted net income increased 6% to $1.3 billion during 2Q09 versus $1.2 billion during 2Q08. Total revenue declined by 1% during 2Q09 to $3.71 billion versus $3.76 billion during 2Q08. The Company provided revenue guidance for 2009 that is trending towards the upper end of its current guidance range of $14.4-14.8 billion. Amgen now expects 2009 adjusted EPS to be in the range of $4.80-4.95, an increase from the previous range of $4.55 to $4.75. The Company now expects 2009 capital expenditures to be less than $600 million, down from the previous estimate of approximately $650 million.

During 2Q09, total product sales declined 2% to $3.63 billion from $3.69 billion during 2Q08 while U.S. sales were flat during the period at $2.83 billion and international sales declined 6% to $801 million due to an unfavorable impact of about $103 million from foreign exchange.

Global sales of Aranesp (darbepoetin alfa) decreased 16% to $693 million in the second quarter of 2009 versus $825 million during the second quarter of 2008 while sales of EPOGEN (Epoetin alfa) increased 3% to $638 million. Combined worldwide sales of Neulasta (pegfilgrastim) and NEUPOGEN (Filgrastim) decreased 4% to $1,158 million in the second quarter of 2009 versus $1,201 million for the second quarter of 2008.

Global sales of Enbrel (etanercept) increased 7% during 2Q09 to $899 million while Sensipar (cinacalcet) posted an 11% sales increase to $167 million. Vectibix (panitumumab) sales during 2Q09 came in at $56 million as compared to $32 million during 2Q08.

On 7/27/09, Amgen and GlaxoSmithKline (NYSE:GSK) also announced a deal to share commercialization of Amgen's monoclonal antibody denosumab for postmenopausal osteoporosis (PMO) in Europe, Australia, New Zealand and Mexico once the product is approved in these countries. Amgen will commercialize the drug for PMO and oncology in the U.S. and Canada and for all oncology indications in Europe and specified markets while GSK will register and commercialize denosumab for all indications in countries where Amgen does not currently have a commercial presence, including China, Brazil, India and South Korea. Financial terms of the partnership include an initial payment and near-term commercial milestones to Amgen totaling $120 million, and ongoing royalties. In Europe, Amgen and GlaxoSmithKline will share profits after accounting for expenses associated with the partnership.

AMGN has a pending BLA for denosumab with a PDUFA action date during early 4Q09 which is included in the FDA Calendar database of 283 entries as of 7/27/09. On 6/22/09, the FDA announced that Amgen's experimental osteoporosis drug denosumab (proposed brand name Prolia) will be reviewed by an Advisory Panel at a meeting on 8/13/09. The FDA Advisory Panel will discuss the Company's proposed uses of (1) treating and preventing osteoporosis in post-menopausal women and (2) treating and preventing bone loss in patients undergoing hormone ablation therapy for prostate and breast cancer. On 7/7/09, AMGN announced that a pivotal, Phase 3, head-to-head trial evaluating denosumab versus Zometa (zoledronic acid) in the treatment of bone metastases in 2,049 patients with advanced breast cancer met its primary and secondary endpoints and demonstrated superior efficacy compared to Zometa.

Vectibix: The Company discussed the approval of revisions to the U.S. prescribing information for the epidermal growth factor receptor (EGFr) class of antibodies, including Vectibix by the U.S. Food and Drug Administration (FDA). This decision follows the FDA's December 2008 Oncologics Drugs Advisory Committee (ODAC) meeting where the clinical utility of the KRAS gene as a predictive biomarker in patients with metastatic colorectal cancer (mCRC) treated with anti-EGFr antibody was discussed. Use of Vectibix is not recommended for the treatment of colorectal cancer with KRAS mutations in codon 12 or 13.

Motesanib: The Company indicated that enrollment has resumed for the Phase 3 MONET1 trial evaluating motesanib in combination with paclitaxel and carboplatin for the first-line treatment of advanced non-small cell lung cancer (NSCLC). The Company also noted that the data from Phase 2 study evaluating motesanib in combination with chemotherapy or bevacizumab in combination with chemotherapy will be presented at the World Conference on Lung Cancer. Motesanib is part of a broad co-development program between Amgen, Takeda (TKPHY.PK), and Millennium.

AMG 423: The Company noted it exercised its option to the worldwide rights (excluding Japan) of Cytokinetics' (NASDAQ:CYTK) cardiac contractility program, which includes CK-1827452, a novel cardiac myosin activator being developed for the treatment of heart failure.

AMG 102: In Phase 2 studies, limited efficacy was seen in glioblastoma multiforme and renal cell carcinoma when AMG 102 was administered in monotherapy, but the effect size was not large enough to warrant moving forward with late-stage studies in these indications. Phase 2 combination studies with AMG 102 in the gastric, prostate, mCRC, and small cell lung cancer settings continue.

Dulanermin: The Company has received a preliminary report on the Phase 2 NSCLC study with dulanermin (rhApo2L/TRAIL), which is being developed in collaboration with Genentech. The Phase 2 program continues to progress and the Company will be reviewing the complete NSCLC data set with Genentech later this year.

AMG 222: The Company has received results from a Phase 2a study of AMG 222 in patients with type 2 diabetes. The results support continued Phase 2 development of AMG 222.

AMG 785: The Company announced that it is in the process of initiating Phase 2 studies of AMG 785 (Sclerostin) in fracture healing and postmenopausal osteoporosis.

Disclosure: No positions

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