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Amgen Shares Fall on Data Delay

January 27, 2006|From Reuters

Amgen Inc. said Thursday that its fourth-quarter earnings rose nearly 20%, but the company's stock fell after it said data from a trial of its highly anticipated new cancer drug would be released later than expected.

Investors had hoped the company would release interim results of a trial of its experimental colon cancer drug panitumumab in combination with other therapies at a meeting with analysts in New York.

Instead, Amgen said it was still enrolling participants in the clinical trial and wouldn't release the results until later. That helped drive down Thousand Oaks-based Amgen's shares $3.57, or 4.7%, to $71.90.

"People were expecting to see some results from the panitumumab trial and they weren't there," said Les Funtleyder, healthcare strategist at brokerage Miller Tabak. "Anytime there is a deviation from projected plans there is going to be nervousness."

The world's biggest biotechnology company said net earnings rose to $824 million, or 66 cents a share, from $689 million, or 53 cents, a year earlier.

Excluding one-time items, earnings matched the average analysts' estimate of 75 cents a share. Revenue rose 12% to $3.3 billion.

Panitumumab is one of the most advanced drugs in Amgen's pipeline and is a crucial part of the company's effort to supplement its more mature products with new growth drivers.

It would compete with ImClone Systems Inc.'s colon cancer drug Erbitux. ImClone's shares rose $1.27, or 3.7%, to $35.76.

"I want our investors to know as much as possible about what we're doing," said Roger Perlmutter, Amgen's head of research and development. "But I can't compromise a study just because an investor wants to know."

Amgen, which aims by the end of the first quarter to file for marketing approval of panitumumab to treat patients who have failed other therapies, is testing the drug in combination with Genentech Inc.'s Avastin plus chemotherapy.

Should the combination treatment prove successful, panitumumab could potentially be used in patients who have not been treated with previous therapies -- a much bigger market.

The company has forecast that it expects the drug to generate annual sales of $2 billion but said that might be conservative.

The company expects 2006 earnings excluding one-time items of $3.55 to $3.70 a share on revenue of $13.9 billion to $14.4 billion.

Analysts, on average, expect the company to earn $3.64 a share in 2006 and expect revenue of $14.3 billion.

Fourth-quarter sales of Aranesp, a treatment for anemia in cancer and kidney dialysis patients, rose 24% to $873 million, driven by increased demand. U.S. sales of the drug were $579 million, up from $449 million a year earlier.

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