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Amgen Earnings Rebound on Sales of Anemia Drugs

Firm posts third-quarter profit of 46 cents a share, compared with a loss a year ago. It also narrows its '03 revenue forecast.

October 22, 2003|Denise Gellene | Times Staff Writer

Amgen Inc. swung to a profit in the third quarter on sharply higher sales of its anemia drugs, the biotechnology giant said Tuesday.

Amgen's revenue gain came at the expense of rival Johnson & Johnson, which posted an 8% drop in anemia drug sales in the quarter. Thousand Oaks-based Amgen said its full-year anemia drug sales should be $3.8 billion to $4 billion, a slight increase over its earlier forecast.

Amgen reported third-quarter earnings of $612 million, or 46 cents a share, contrasted with a loss of $2.6 billion, or $2.10, a year ago. The year-earlier quarter included a $3-billion write-off related to the acquisition of Immunex Corp.

Excluding litigation and other expenses, Amgen's third-quarter profit was $714 million, or 53 cents a share, topping Wall Street's estimate of 51 cents, according to Thomson First Call.

Amgen's quarterly sales rose to $2.2 billion, up 47% from $1.5 billion a year ago, led by a 58% gain in combined sales of anemia drugs Aranesp and Epogen.

Amgen continued to close the sales gap with J&J, which markets anemia drugs under a license from Amgen. This year, Amgen's anemia medications have posted combined sales of $2.8 billion, compared with $3 billion for J&J's products. Sixty percent of Amgen's sales are in the dialysis business, where it has a monopoly.

Sales of Enbrel, Amgen's rheumatoid arthritis drug that is also used to treat psoriasis, soared 116% over the year-ago quarter, when the product faced supply shortages. Enbrel soon will face competition from Genentech Inc.'s Raptiva, a psoriasis medication expected to receive marketing approval from the Food and Drug Administration next week.

Amgen Chairman and Chief Executive Kevin Sharer said the psoriasis market was big enough to accommodate a new competitor but declined to predict how Raptiva might affect Enbrel's sales. "We believe Enbrel is a better, safer product," he said.

Amgen's latest results included a charge of $47 million, or 2 cents a share, related to a settlement of patent litigation with Genentech.

Expenses rose in the quarter because of higher research and development spending and the increased cost of producing and marketing Enbrel.

Amgen said its fourth-quarter expenses would include an $86.5-million payment related to a recent diabetes drug licensing agreement with Biovitrum.

Amgen narrowed its full-year product sales forecast to $7.6 billion to $7.9 billion. Amgen previously said total product sales would be $7.5 billion to $8 billion.

Amgen announced its results after the market closed. On Nasdaq, Amgen rose $1.76 to $63.65. The stock fell to $61.65 in after-hours trading.

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