Amgen reports 15% revenue growth in Q3, expanded R&D focus

By Jennifer Lanning Drey

Portland, Ore., Oct. 23 - Amgen Inc. reported $3.61 billion in third-quarter revenues, representing 15% growth over the $3.15 billion it reported in revenues for the third quarter of 2005, according to a company news release.

The growth was primarily driven by strong demand for products including Aranesp (darbepoetin alfa) and Neulasta (pegfilgrastim), said Richard Nanula, Amgen's chief financial officer, during a company conference call held Monday.

The company finished the third quarter with cash and marketable securities of $5.8 billion and debt of $9.0 billion but expects to finish the year with a cash balance that is about $2.0 billion less than its debt, Nanula said.

Amgen has increased investments in research and development by between 30% and 40% so far this year, and the additional R&D focus has manifest itself through the initiation and expansion of large product opportunities, company chief executive officer Kevin Sharer told investors during Monday's call.

During the quarter, the company began two new "mega-trials," which it defines as clinical trials with more than 200 sites, he said.

One of the mega-trials will study Vectibix as a treatment first-line colorectal cancer. The other will determine whether Sensipar/Mimpara (cinacalcet HCI) can effectively reduce the risk of mortality and morbidity in patients with stage-five chronic kidney disease undergoing maintenance dialysis.

In total, Amgen has started nine mega-trials in 2006, Sharer said.

Amgen has 47 molecules in its research and development pipeline, and the company has committed 11 new molecules into clinical development this year.

Amgen reported adjusted net income, excluding stock option expense, of $1.22 billion, or $1.04 per share, for the third quarter.

The numbers compare to $1.07 billion, or $0.85 per share, during the third quarter of 2005.

"We feel really good about this quarter, about the year to date and about the future," Sharer said.

Plan to use Aranesp data

Amgen also said Monday that it plans to propose to the Food and Drug Administration that the agency allow the company to submit existing data in response to the FDA's request for additional data to support both the every-two-weeks and the monthly dosing regiments of Aranesp for chronic kidney disease.

Amgen received an approvable letter earlier this month in response to the supplemental Biologics License Application the company filed for the products in December 2005.

"We do have quite a lot of data that was not available to us at the time of the filing of the supplementary BLA and those data could be used in principal to support approval," said Roger Perlmutter, executive vice president of research and development for Amgen.

Amgen is a biotechnology company based in Thousand Oaks, Calif.

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