Watch out for Enbrel’s Contribution to Amgen, Inc. (AMGN)’s 2Q Numbers


Amgen, Inc. (NASDAQ:AMGN) has consistently delivered more than expected earnings in the last four quarters. The company’s earnings have rarely missed Wall Street expectations. That was mainly because of the company’s product profile that has not been affected by patent expiry loss. As a result, expectations are elevated from the analysts, as well as, the investors.

Product Revenues

Amgen, Inc. (NASDAQ:AMGN) generates nearly two-third of its product revenues from four products. The main product contribution is Neulasta / NEUPOGEN. Both contributed 28.3% of the product revenue of $4.87 billion in the first quarter. However, its contribution dipped from 31.7% in the year-ago quarter since there was no YOY growth. Therefore, the trend might have continued in the June quarter too.

The next is Enbrel drug. Its contribution of 22.9% to the total revenue is significant because the product delivered 13% uptick compared to overall product sales growth of 12%. Its contribution improved by 22 basis points from the year-ago quarter. Another drug, EPOGEN, witnessed 16% YOY growth and contributed 10.96% to the overall product revenue. Its YOY contribution has improved by 25 basis points. Only one drug was dragging the product sales, i.e. NEUPOGEN.

Key Growth Drivers

Amgen, Inc. (NASDAQ:AMGN) believed that its key drivers for growth would come from pricing, as well as, increased unit demand. The company also expects a significant contribution from its product, Prolia, Sensipar, and XGEVA. The growth in the United States is expected to outpace the International market by constant currency in the second quarter.

The drug maker believes that its focus has been clear on expense discipline, as well as, priorities. The company’s objective is to successfully implement new product launches. While advancing its strong pipeline of key medicines, its objective was to transform its business to boost alertness and deliver efficiencies besides cost saving. The company is also aiming to deliver progress on long-term objectives.

Product Pipeline

The pharmaceutical company disclosed recently that its new cholesterol-lowering drug, Repatha, was approved by the European Commission. The company said that it was the first to be approved for high cholesterol treatment. In another development the drug maker revealed positive BLINCYTO Phase two trial results in patients affected by relapsed or refractory Philadelphia chromosome – Positive B-Cell Precursor Acute Lymphoblastic Leukemia. The company’s ASPIRE supplementary NDA is also under the priority review by the US FDA. It will also submit ENDEAVOR for approval.

Amgen, Inc. (NASDAQ:AMGN) believes that it has got enough products and pipeline to ensure future growth. Analysts are expecting the company deliver earnings of $2.42 a share and revenue of $5.32 billion for the June quarter. Analysts have revised their EPS estimation upwards in the last one week period suggesting that the company’s earnings might beat one more time. The company is reporting its June quarter numbers on July 30.

Viraj Shah

Viraj Shah has completed M.Com (Finance) and is currently pursuing his CFP. He tracks US markets along with other global markets like India very closely. He is very passionate about stocks, real estate, and technology. He also believes that money can always be made in the market.

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