Amgen first quarter sales disappoint, shares fall
(Reuters) - Amgen Inc (AMGN.O) on Tuesday reported first-quarter sales that fell short of Wall Street expectations for most of its biggest-selling medicines, and its shares fell more than 6 percent.
Revenue for the quarter rose 5 percent to $4.24 billion, but was shy of Wall Street expectations of $4.37 billion.
"It was a soft revenue quarter across the board. They missed on all the major products versus consensus and our expectations," said Geoffrey Porges, a biotech analyst with Sanford Bernstein. "It reflects the maturity and increasing competitive intensity facing the company's core products."
The world's biggest biotechnology company did manage to post a profit that exceeded expectations. Excluding one time items, Amgen had adjusted earnings of $1.96, topping analysts' average expectations by 12 cents, according to Thomson Reuters I/B/E/S.
Amgen made up for the shortfall in expected sales "with a little bit of belt tightening and a likely non-recurring tax windfall," Porges said.
Amgen still expects full year revenue of $17.8 billion to $18.2 billion. But it said it now sees earnings per share coming in above the midpoint of its forecast range of $7.05 to $7.35 per share. Wall Street is estimating revenue of $18.07 billion and earnings of $7.21 per share.
"We are well positioned to achieve our full year revenue growth projections," Chief Financial Officer Jonathan Peacock told analysts on a conference call.
The company posted a net profit of $1.43 billion, or $1.88 per share, compared with a profit of $1.18 billion, or $1.48 per share, a year ago.
Amgen earlier this year said it planned to make a big push into biosimilars - cheaper alternative versions of biotech medicines - with plans to launch six beginning in 2017. On Tuesday, it said it would begin a pivotal clinical trial of its version of Roche's (ROG.VX) multibillion-dollar breast cancer drug Herceptin during the current quarter.
Sales of the blockbuster rheumatoid arthritis drug Enbrel rose 11 percent to $1.04 billion in the first quarter, largely due to price increases. But that was short of Wall Street expectations of about $1.09 billion.
The anemia drug Aranesp saw sales fall 10 percent to $468 million, well short of analysts' estimates of about $490 million. Sales of the older anemia drug Epogen fell 2 percent to $435 million, missing Wall Street estimates of about $460 million. Both drugs have been in decline for years because of usage restrictions and safety concerns.
The anemia franchise did not appear to benefit much from the withdrawal from the market due to serious safety concerns of a new rival product - Omontys from Affymax Inc AFFY.O.
Even the fast growing newer drugs Xgeva, for preventing fractures due to cancer that has spread to the bones, and the related osteoporosis drug Prolia disappointed Wall Street.
Xgeva sales grew 46 percent to $223 million, short of the $235 million Wall Street was looking for, while Prolia sales jumped 61 percent to $142 million, shy of expectations of about $159 million and down from the prior quarter's $159 million.
Amgen blamed the Prolia performance on what it called "seasonal softness," and said it has seen a significant pickup in sales over the past six weeks.
Combined worldwide sales of the white blood cell boosters Neupogen and Neulasta were flat at $1.34 billion.
Amgen shares fell to $105.50 in extended trading from their Nasdaq close at $112.76. But Amgen shares had been on a tear, climbing 30 percent so far this year.
(Reporting by Bill Berkrot; Editing by Phil Berlowitz)
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