Amgen Profit Tops Estimates; Lifts FY Guidance

(RTTNews) - Biotechnology giant Amgen Inc. (AMGN), Tuesday posted a better-than-expected increase in third-quarter profit on improved sales of its white blood cell boosters Neulasta and Neupogen, arthritis drug Enbrel, and osteoporosis treatment Xgeva. Sales were also boosted with contribution from myeloma drug Kyprolis after the acquisition of Onyx Pharmaceuticals. Amgen's earnings and revenues for the quarter topped Wall Street estimates.

Looking ahead, Amgen also lifted its adjusted earnings and sales outlook for 2013.

Thousand Oaks, California-based Amgen reported third-quarter net income of $1.4 billion or $1.79 per share, compared with $1.1 billion or $1.41 per share last year.

Excluding items, adjusted earnings for the quarter were $1.5 billion or $1.94 per share, compared with $1.3 billion or $1.67 per share a year ago. On average, 20 analysts polled by Thomson Reuters expected earnings of $1.77 per share for the quarter. Analysts' estimates typically exclude special items.

Revenue for the quarter climbed 10 percent to $4.75 billion from $4.3 billion in the prior year. Twenty analysts had a consensus revenue estimate of $4.60 billion for the quarter.

Combined sales of Neulasta and Neupogen were up 18 percent from a year ago to $1.6 billion and Enbrel sales climbed 7 percent to $1.16 billion.

Total sales of XGEVA, for the prevention of skeletal related events, and Prolia, for postmenopausal osteoporosis, jumped 41 percent to $439 million. Kyprolis recorded sales of $65 million, up 6 percent sequentially.

Meanwhile, sales of anemia drug Aranesp fell 10 percent to about $450 million, while Epogen sales were flat at $491 million.

Amgen's research expense for the third quarter climbed to $989 million from $880 million last year, while income tax expense declined to $135 million from $136 million a year ago.

For 2013, Amgen now expects adjusted earnings of $7.35 to $7.45 per share and revenue of $18.3 billion to $18.5 billion. Earlier, earnings were estimated above the midpoint of $7.30 to $7.45 per share with revenue ranging from $17.8 billion to $18.2 billion.

Analysts currently estimate earnings of $7.32 per share on revenue of $18.33 billion for 2013.

In August, Amgen agreed to buy cancer drug maker Onyx Pharmaceuticals Inc. (ONXX) for about $10.4 billion, thus gaining the myeloma drug Kyprolis. Market analysts expects Kyprolis to generate annual sales between $2 billion and $3 billion in a few years.

Amgen will also gain revenues from Nexavar, the liver and kidney cancer drug that Onyx sells in partnership with Germany's Bayer AG, and also royalty payments from Bayer's colon cancer treatment drug Stivarga.

Earlier today, Amgen repurchased rights to Neulasta and Neupogen in emerging markets from Roche. Effective January 2014, Amgen will assume responsibility for these products in markets outside the U.S. and Europe with annual sales of about $200 million.

AMGN closed Tuesday at $116.12, up $2.48 or 2.18%, on a volume of 3.2 million shares on the Nasdaq. In after hours, the stock gained $0.90 or 0.78%, trading at $117.02. In the last 52 weeks, the share trended in the range of $81.56 - $117.91, on a three-month average volume of 3.18 million.