Amgen Leans on Newer Drugs as Pandemic Hampers Demand

By Micah Maidenberg

Amgen Inc. said the Covid-19 pandemic weighed on demand for a number of its therapies as patients weren't able to visit doctors but newer products helped it deliver both sales and volume growth.

Overall, Amgen reported $6.21 billion in revenue for the second quarter, up 6% compared with last year and slightly ahead of nearly $6.2 billion that analysts expected for the period, according to FactSet.

Volumes rose 13% year over year, helped by drugs such as Otezla, a treatment for plaque psoriasis that Amgen acquired in November. The drug generated $561 million in sales for the quarter, the company said.

But sales and volumes for other Amgen products were hampered by the coronavirus, which kept many people in the U.S. and other markets at home starting this spring and out of doctors' offices.

Lower interactions between patients and doctors as the coronavirus spread has emerged as a challenge for companies focused on health. Several big health-care companies, including insurer Humana Inc. and Walgreens Boots Alliance Inc., have partnered on an advertising campaign aimed at encouraging people to return to medical providers.

"The pandemic interrupted many physician-patient interactions, which led to delays in diagnosis and treatment with varying degrees of impact across our portfolio," Amgen said Tuesday.

Sales of Enbrel, a medicine used to treat rheumatoid arthritis and other conditions, fell 9% in the quarter to $1.25 billion amid competition and due to the pandemic, Amgen said. Enbrel is the company's biggest drug by sales.

Amgen reported second-quarter net income of $1.8 billion, or $3.05 a share, down from $2.18 billion, or $3.57 a share, the year earlier.

Operating expenses were up 22% in the quarter, as Amgen absorbed Otezla, which it purchased last November for $13.4 billion from Celgene Corp. as part of Celgene's merger Bristol-Myers Squibb Co. Amgen said it recorded higher amortization expenses related to the drug.

Earnings following adjustments rose to $4.25 a share for the quarter and were ahead of the $3.82 a share consensus estimate.

Amgen also said Tuesday it is developing therapeutic antibodies that may be complementary with other antibodies directed against the coronavirus.

Write to Micah Maidenberg at [e-mail]

(END) Dow Jones Newswires

July 28, 2020 16:16 ET (20:16 GMT)

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