Amgen (AMGN - Free Report) stock has risen 38.2% this year so far against a decline of 23.4% for the industry.
Here we discuss the factors for the stock's outperformance. Amgen’s key drugs like Prolia, Repatha and Otezla are aiding sales, driven by volume growth. These drugs are gaining consistent approvals for label expansions.
Moreover, Amgen is evaluating Prolia/Xgeva, Vectibix, Enbrel, Aranesp, Kyprolis, Nplate and Blincyto for additional indications. Importantly, new drugs Lumakras and Tezspire are off to an encouraging start. Lumakras (sotorasib) was approved for advanced non-small cell lung cancer (NSCLC) in the United States in May 2021 and in the EU in January 2022. It is now available in more than 45 countries. Also, label expansion studies on Lumakras, with the potential to significantly expand the currently addressable patient population, are progressing rapidly.
Tezspire (tezepelumab) was approved to treat severe asthma in the United States in December 2021. Amgen has a partnership with AstraZeneca (AZN - Free Report) for Tezspire. In September, AstraZeneca announced that Tezspire was approved in Japan and Europe. Amgen and AstraZeneca share costs and profits equally after payment by AstraZeneca of a mid-single-digit inventor royalty to Amgen. While AstraZeneca leads development, Amgen leads manufacturing.
Amgen is also rapidly advancing its robust pipeline of early and late-stage assets. Several phase III readouts are due in 2023, which could act as catalysts for the stock. The recent acquisition of ChemoCentryx added a strategic new growth asset in Tavneos to Amgen’s portfolio
Amgen also boasts a strong biosimilars portfolio, which is an important long-term growth driver. Amgen markets Kanjinti (a biosimilar of Roche’s [RHHBY] Herceptin) and Mvasi (a biosimilar of Roche’s Avastin) in the United States and Amgevita (a biosimilar of AbbVie’s [ABBV] Humira), Kanjinti and Mvasi outside the United States. In the United States, AbbVie’s Humira biosimilar, Amjevita is expected to be launched in 2023. Amgen will be one of the first companies to launch its biosimilar of AbbVie’s Humira in early 2023.
Biosimilars of J&J’s Stelara (ABP 654), Alexion’s Soliris (ABP 959) and Regeneron’s Eylea (ABP 938) are in late-stage state development. Amgen has successfully completed phase III studies for all these biosimilar candidates. Amgen’s biosimilars revenues are annualizing at over $2 billion in sales, while it is expected to more than double from 2021 to 2030, supported by Amjevita launch and other biosimilars in late-stage development.
Amgen has its share of problems. Increased pricing headwinds and competitive pressure are hurting sales of many of Amgen’s products, including some biosimilars. The Humira U.S. sales erosion in 2023 and increasing biosimilar competition for some other legacy products create potential revenue headwinds.
Amgen’s net selling price has declined for the past few years with the trend expected to continue in 2023 due to increased competition. In addition, foreign exchange headwinds with the strengthening of the U.S. dollar, increasing interest rates, persistently high inflation, supply chain pressure and the war in Europe are creating an uncertain macro environment.
Nonetheless, continued strong growth of key drugs, higher sales from ex-U.S. markets, increased contribution from its high-quality biosimilars and costs savings should keep the stock afloat in 2023.
Zacks Rank
Amgen currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Amgen (AMGN - Free Report) stock has risen 38.2% this year so far against a decline of 23.4% for the industry.
Here we discuss the factors for the stock's outperformance. Amgen’s key drugs like Prolia, Repatha and Otezla are aiding sales, driven by volume growth. These drugs are gaining consistent approvals for label expansions.
Moreover, Amgen is evaluating Prolia/Xgeva, Vectibix, Enbrel, Aranesp, Kyprolis, Nplate and Blincyto for additional indications. Importantly, new drugs Lumakras and Tezspire are off to an encouraging start. Lumakras (sotorasib) was approved for advanced non-small cell lung cancer (NSCLC) in the United States in May 2021 and in the EU in January 2022. It is now available in more than 45 countries. Also, label expansion studies on Lumakras, with the potential to significantly expand the currently addressable patient population, are progressing rapidly.
Tezspire (tezepelumab) was approved to treat severe asthma in the United States in December 2021. Amgen has a partnership with AstraZeneca (AZN - Free Report) for Tezspire. In September, AstraZeneca announced that Tezspire was approved in Japan and Europe. Amgen and AstraZeneca share costs and profits equally after payment by AstraZeneca of a mid-single-digit inventor royalty to Amgen. While AstraZeneca leads development, Amgen leads manufacturing.
Amgen is also rapidly advancing its robust pipeline of early and late-stage assets. Several phase III readouts are due in 2023, which could act as catalysts for the stock. The recent acquisition of ChemoCentryx added a strategic new growth asset in Tavneos to Amgen’s portfolio
Amgen also boasts a strong biosimilars portfolio, which is an important long-term growth driver. Amgen markets Kanjinti (a biosimilar of Roche’s [RHHBY] Herceptin) and Mvasi (a biosimilar of Roche’s Avastin) in the United States and Amgevita (a biosimilar of AbbVie’s [ABBV] Humira), Kanjinti and Mvasi outside the United States. In the United States, AbbVie’s Humira biosimilar, Amjevita is expected to be launched in 2023. Amgen will be one of the first companies to launch its biosimilar of AbbVie’s Humira in early 2023.
Biosimilars of J&J’s Stelara (ABP 654), Alexion’s Soliris (ABP 959) and Regeneron’s Eylea (ABP 938) are in late-stage state development. Amgen has successfully completed phase III studies for all these biosimilar candidates. Amgen’s biosimilars revenues are annualizing at over $2 billion in sales, while it is expected to more than double from 2021 to 2030, supported by Amjevita launch and other biosimilars in late-stage development.
Amgen has its share of problems. Increased pricing headwinds and competitive pressure are hurting sales of many of Amgen’s products, including some biosimilars. The Humira U.S. sales erosion in 2023 and increasing biosimilar competition for some other legacy products create potential revenue headwinds.
Amgen’s net selling price has declined for the past few years with the trend expected to continue in 2023 due to increased competition. In addition, foreign exchange headwinds with the strengthening of the U.S. dollar, increasing interest rates, persistently high inflation, supply chain pressure and the war in Europe are creating an uncertain macro environment.
Nonetheless, continued strong growth of key drugs, higher sales from ex-U.S. markets, increased contribution from its high-quality biosimilars and costs savings should keep the stock afloat in 2023.
Zacks Rank
Amgen currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
4 Oil Stocks with Massive Upsides
Global demand for oil is through the roof... and oil producers are struggling to keep up. So even though oil prices are well off their recent highs, you can expect big profits from the companies that supply the world with "black gold."
Zacks Investment Research has just released an urgent special report to help you bank on this trend.
In Oil Market on Fire, you'll discover 4 unexpected oil and gas stocks positioned for big gains in the coming weeks and months. You don't want to miss these recommendations.
Download your free report now to see them.
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