Amgen investors await weight-loss drug data

By Deena Beasley

(Reuters) -Amgen investors eyeing dramatic share price gains for rivals with successful obesity drugs will be focused on any updates the biotech company may provide on its own weight-loss drug candidates when it reports quarterly earnings on Thursday.

Amgen has said it expects to have first-in-human results from a small, early-stage trial of experimental oral compound AMG786 before the end of June.

"We are still collecting and analyzing the data," Amgen Chief Scientific Officer Jay Bradner told Reuters in an interview.

The Thousand Oaks, California-based company has not disclosed the design of AMG786, saying only that it does not target hormones secreted by the digestive system called incretins.

Amgen's most advanced weight loss candidate, MariTide, does target incretins and is given by injection. It joins a compound designed to activate the GLP-1 hormone associated with a feeling of fullness to an antibody that blocks activity of a different gut hormone, GIP, that has been linked to fat storage and metabolic regulation.

MariTide is "hitting these targets in a really different and unique way ... medically this could translate into better efficacy and better durability," Bradner said.

Amgen is one of several companies trying to grab a piece of the weight-loss drug pie that some analysts forecast will exceed $100 billion a year by the end of the decade.

Popular weight-loss drugs first used as diabetes treatments - Eli Lilly's Zepbound and Novo Nordisk's Wegovy, neither of which have been able to keep up with demand - are weekly injections that activate GLP-1. Zepbound is designed to also activate GIP.

"Weekly injections with weekly symptoms is not for every patient, and we're hopeful that the dose and schedule of MariTide will be much less frequent," Bradner said, referring to side effects of the medicines.

Lee Brown, analyst at investment research firm Third Bridge, said health insurers and other payers "do not want to be dealing with a duopoly" and would embrace effective new weight-loss options.

A large company like Amgen, despite being a later market entrant, has significant tools at its disposal to negotiate pricing and coverage terms with payers, he said.

Amgen expects to have results from a 52-week, mid-stage trial of MariTide late this year. Some of those patients will be enrolled in another study for a second full year of dosing.

Data from a small Phase 1 trial showed that at the highest monthly dose tested, given for 12 weeks, MariTide led to mean weight loss of 14.5%, which was maintained for 70 days. Some patients sustained substantial weight loss for 150 days after the last dose.

In large Phase 3 trials that lasted more than a year, Wegovy and Zepbound showed weight loss of 15% and 21%, respectively.

'UP A LOT OR DOWN A LOT'

Shares of Amgen have fallen about 15% since early February, when full results of its 49-person MariTide study were published in a medical journal, including details on trial drop outs and high rates of nausea for patients given the highest dose.

"The way the stock market prices Amgen there is always a fear that they won't be able to come up with an outstanding new biologic every three or four years," said Bill Smead, chief investment officer at Smead Capital Management, which holds Amgen shares.

Smead said he remains confident in Amgen's long-term value "in an environment where good ideas are hard to come by."

Year-to-date, Lilly's shares have gained 30% and Novo Nordisk's are up 25%. Both have become among the world's most valuable publicly traded companies due to explosive demand for their weight-loss drugs.

For the first quarter, analysts expect Amgen to report earnings of $3.88 per share on revenue of $7.44 billion, according to LSEG data.

The company's shares were up 0.75% at $275.99 on Wednesday.

Jefferies biotechnology analyst Michael Yee in a recent video said nearly all of his recent meetings have been on the topic of obesity, particularly Amgen's experimental drugs.

"Quite frankly Amgen is the name of the year," he said. "It's either going to be up a lot or down a lot."

(Reporting By Deena BeasleyEditing by Bill Berkrot)