Yahoo Finance Amgen Inc (AMGN) Q1 2024 Earnings Call Transcript Highlights: Strong Growth and Strategic Advances
Total Revenue: $7.4 billion, up 22% year-over-year.
Product Sales: Excluding Horizon products, increased 6% year-over-year.
Operating Margin: Q1 operating margin was 43%.
Free Cash Flow: $0.5 billion, decreased from $0.7 billion the previous year.
Net Income: Not specifically mentioned.
Earnings Per Share (EPS): 2024 guidance anticipates non-GAAP EPS between $19 and $20.20.
Key Product Sales: Repatha $517 million, up 33%; EVENITY $342 million, up 35%; TEZSPIRE $173 million, up 80%; BLINCYTO $244 million, up 26%.
Rare Disease Sales: Over $950 million in Q1, TEPEZZA $424 million, up 5% year-over-year.
2024 Revenue Guidance: Expected in the range of $32.5 billion to $33.8 billion.
Research and Development (R&D) Expenses: Non-GAAP R&D expenses to increase by approximately 25% year-over-year.
Release Date: May 02, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
Amgen Inc (NASDAQ:AMGN) reported strong sales growth of 22% year-over-year in the first quarter, driven by robust volume growth across its four therapeutic pillars.
The company's newest pillar of growth, rare disease, contributed nearly $1 billion of sales in the quarter, up 14% compared to the previous year, highlighting significant upside potential.
Amgen Inc (NASDAQ:AMGN) is advancing a broad range of potential first-in-class medicines in its mid- and late-stage pipeline, including tarlatamab for small cell lung cancer and MariTide for obesity and related conditions.
The integration of Horizon, including its people, products, and pipeline, is proceeding well, reflecting a strong fit between the organizations and contributing positively to growth.
Amgen Inc (NASDAQ:AMGN) is actively expanding its manufacturing capacity to support both clinical and commercial supply, ensuring readiness for future product launches and market demands.
Negative Points
Despite overall strong performance, Enbrel sales decreased by 2% year-over-year in the first quarter, driven by volume decline.
The company's non-GAAP operating expenses rose by 33%, reflecting significant investments in Horizon acquired products and other late-stage pipeline medicines, which could pressure profit margins if not managed effectively.
Amgen Inc (NASDAQ:AMGN) faces challenges in the inflammation business, as Otezla sales only increased by 1% year-over-year, affected by external factors like the Change Healthcare cybersecurity issue.
The COURSE Phase IIa study of TEZSPIRE in COPD patients did not achieve statistical significance, which may affect its potential impact and market adoption in this indication.
While Amgen Inc (NASDAQ:AMGN) is making strides in its biosimilars portfolio, it experienced a 12% year-over-year growth in the first quarter, with challenges due to lower inventory levels and net selling price decline.
Q & A Highlights
Q: On MariTide, what were you looking to learn in the Phase II trial that enabled you to move forward to Phase III? A: (James E. Bradner - Executive VP of Research and Development & Chief Scientific Officer) The Phase II study was well-designed and executed, providing a broad and differentiated profile that guides and encourages the Phase III clinical investigation.
Q: Can you confirm that the interim analysis for MariTide looked at all doses and included safety metrics? A: (James E. Bradner - Executive VP of Research and Development & Chief Scientific Officer) The study was comprehensive with measurements, but specific details on individual characteristics cannot be discussed to avoid bias. The results to date are satisfactory, and all study arms remain active without patient dropout issues.
Q: Regarding MariTide, which areas do you see as points of differentiation? A: (Murdo Gordon - EVP of Global Commercial Operations) The focus is on achieving a broad and differentiated profile for MariTide, considering both in-market products and those in development.
Q: What preparations are being made for the potential launch of tarlatamab? A: (Murdo Gordon - EVP of Global Commercial Operations) Preparations are robust, with trained field personnel ready to engage treating physicians immediately post-approval. The focus is on broad access and significant patient impact, especially given the dire need in small cell lung cancer treatment.
Q: What are the manufacturing complexities and investments expected for AMG 133 compared to traditional GLP-1s? A: (Robert A. Bradway - Chairman, CEO & President) The manufacturing process for AMG 133, based on an antibody backbone, aligns with Amgen's expertise in biotherapeutic manufacturing. The company is prepared for the clinical and commercial scale-up, maintaining a reliable supply chain.
Q: Could you discuss the potential expansion of MariTide beyond diabetes and obesity? A: (James E. Bradner - Executive VP of Research and Development & Chief Scientific Officer) The focus remains on addressing unmet needs in obesity and related conditions, including diabetes, with a comprehensive Phase III program planned.
Q: What is the status of the subcutaneous TEPEZZA program for TED? A: (James E. Bradner - Executive VP of Research and Development & Chief Scientific Officer) A Phase III study for moderate to severe active TED using subcutaneous administration has been initiated, aiming to match the efficacy of intravenous studies.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.