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Amgen Inc Earnings - Analysis & Highlights for Q4 2024
Overview
PositivesNegativesOutlook
- Product sales grew by 11% YoY in Q4, driven by strong execution across the business.
- EVENITY continues to be the segment leader in the bone-builder market in the US.
- Repatha, a multibillion-dollar product, continues to expand as access improves worldwide.
- TEPEZZA's Q1 performance is expected to be lower than the other three quarters due to insurance verification and purchasing patterns in the market.
- The slope of the biosimilar erosion is expected to be towards the back end due to the settlements reached.
- The next medicine after MariTide did not meet the high bar for clinical investigation at Amgen.
- The company expects Q1 non-GAAP operating margin to be the lowest of the year at roughly 42%.
- Capital expenditures are expected to be approximately $2.3 billion in 2025.
- Revenue range reflects strong growth outlook driven by numerous opportunities across each therapeutic area.
- Q1 non-GAAP operating margin is expected to be the lowest of the year at roughly 42% and then accelerate in each of the quarters following the first quarter.
- Other revenue is expected to be approximately $1.4 billion for the full year.
Q&A Highlights from Amgen Inc Earnings Call Q4 2024
- Analyst asked about the growth runway and potential for biosimilar competition for KRYSTEXXA and the competitive landscape for TEPEZZA.
- Murdo Gordon stated that KRYSTEXXA had a strong year-over-year growth, with Horizon performance included, and that the portfolio of products is early in their life cycle with more data to flow. He also mentioned that TEPEZZA has a number of catalysts for growth in the US and internationally, including recent approval in Japan.
- Murdo Gordon stated that KRYSTEXXA had a strong year-over-year growth, with Horizon performance included, and that the portfolio of products is early in their life cycle with more data to flow. He also mentioned that TEPEZZA has a number of catalysts for growth in the US and internationally, including recent approval in Japan.
- Analyst asked about Amgen's strategic view of where it wants to be in a couple of years, given the focus on MariTide and the desire for a multiple asset portfolio, including orals.
- Robert Bradway stated that Amgen's obesity efforts fit well with its strength in cardiovascular disease, nephrology, and primary care, and that it has all the talent, capabilities, ideas, and rising medicines to be a major player in obesity. Jay Bradner added that the company is confident in MariTide and the pipeline behind it, with ideas targeting integrins and non-integrins, and medicines that will be given orally or subcutaneously. He also mentioned that Amgen is interested in open partnerships through external innovation.
- Robert Bradway stated that Amgen's obesity efforts fit well with its strength in cardiovascular disease, nephrology, and primary care, and that it has all the talent, capabilities, ideas, and rising medicines to be a major player in obesity. Jay Bradner added that the company is confident in MariTide and the pipeline behind it, with ideas targeting integrins and non-integrins, and medicines that will be given orally or subcutaneously. He also mentioned that Amgen is interested in open partnerships through external innovation.
- Analyst asked about the key lessons learned from the Repatha VESALIUS-CV outcome study results and how they can be leveraged across Amgen's portfolio, including olpasiran and MariTide.
- Robert Bradway explained that Amgen has learned a lot from Repatha, including their leading capability in population genetics and epidemiology. The broad use of Repatha in secondary prevention has set up VESALIUS-CV, a Phase 3 large cardiovascular outcome study, for success. The study will provide a valuable data set for understanding the improvement of cardiovascular outcomes for patients. Amgen has already harvested insights from Repatha and applied them to the design and execution of the olpasiran Phase 3 program, which is expected to have an event-driven outcome in the second half of 2024. Murdo Gordon added that the synergies between LDL lowering and Lp(a) lowering will be significant and substantial, and the intentionality and speed to move to a pharmacotherapeutic for Lp(a) lowering will be different than it has been for LDL.
- Robert Bradway explained that Amgen has learned a lot from Repatha, including their leading capability in population genetics and epidemiology. The broad use of Repatha in secondary prevention has set up VESALIUS-CV, a Phase 3 large cardiovascular outcome study, for success. The study will provide a valuable data set for understanding the improvement of cardiovascular outcomes for patients. Amgen has already harvested insights from Repatha and applied them to the design and execution of the olpasiran Phase 3 program, which is expected to have an event-driven outcome in the second half of 2024. Murdo Gordon added that the synergies between LDL lowering and Lp(a) lowering will be significant and substantial, and the intentionality and speed to move to a pharmacotherapeutic for Lp(a) lowering will be different than it has been for LDL.
- Analyst asked about Amgen's stance on looking overseas for clinical-stage assets and their appetite for M&A post the Horizon acquisition.
- Robert Bradway stated that Amgen's position on business development remains consistent, and they are focused on molecules that they think they can add value to, irrespective of where they come from. They have maintained a very active search for interesting opportunities for licensing and acquisitions all around the globe, and they are open for business, looking for those opportunities.
- Robert Bradway stated that Amgen's position on business development remains consistent, and they are focused on molecules that they think they can add value to, irrespective of where they come from. They have maintained a very active search for interesting opportunities for licensing and acquisitions all around the globe, and they are open for business, looking for those opportunities.
- Analyst asked about incorporating the Phase 3 program schedule into the MariTide Phase 2 obesity data presentation and if ADA is a fair assumption for the presentation.
- Amgen plans to present the Phase 2 part 1 data at the ADA meeting in June 2024, and the company looks forward to presenting the full MariTide Phase 2 obesity data at a later date.
- Amgen plans to present the Phase 2 part 1 data at the ADA meeting in June 2024, and the company looks forward to presenting the full MariTide Phase 2 obesity data at a later date.
- Analyst asked about the growth potential of TEPEZZA in both the US and international markets, specifically in Japan and other new markets.
- Murdo J. Gordon, Amgen's executive vice president of global commercial operations, provided an overview of TEPEZZA's growth potential in Japan and other international markets. He mentioned that Japan has a significant epidemiology of 25,000 patients, and the care model in Japan reduces the friction that prescribers and patients experience in terms of finding access to the right physician and then access to a site of care. He also mentioned that the company has identified over 550 patients in Japan who have been identified by prescribers, and the weekly data are showing some pretty good steady momentum. He also mentioned that Amgen has seven other markets that they plan to launch TEPEZZA in, pending regulatory approvals, and that international growth is a catalyst for the overall brand. He also mentioned that TEPEZZA follows the pattern seen in other products in Amgen's portfolio where the first quarter of the year will be lower than the other three quarters, mostly due to insurance reverification and purchasing patterns in the market. However, long-term, TEPEZZA's growth is looking very good given the international approvals and the momentum that Amgen plans to generate in the US.
- Murdo J. Gordon, Amgen's executive vice president of global commercial operations, provided an overview of TEPEZZA's growth potential in Japan and other international markets. He mentioned that Japan has a significant epidemiology of 25,000 patients, and the care model in Japan reduces the friction that prescribers and patients experience in terms of finding access to the right physician and then access to a site of care. He also mentioned that the company has identified over 550 patients in Japan who have been identified by prescribers, and the weekly data are showing some pretty good steady momentum. He also mentioned that Amgen has seven other markets that they plan to launch TEPEZZA in, pending regulatory approvals, and that international growth is a catalyst for the overall brand. He also mentioned that TEPEZZA follows the pattern seen in other products in Amgen's portfolio where the first quarter of the year will be lower than the other three quarters, mostly due to insurance reverification and purchasing patterns in the market. However, long-term, TEPEZZA's growth is looking very good given the international approvals and the momentum that Amgen plans to generate in the US.
- Analyst asked about the indication for the MARITIME trials, which are scheduled to start in the first half of 2025, and whether the trials will have a head-to-head comparison against incumbents such as tirzepatide or sema.
- James E. Bradner, the Chief Executive Officer of Amgen, explained that the MARITIME Phase 3 program is focused on chronic weight management, cardiovascular disease, kidney disease, Type 2 diabetes, sleep apnea, heart failure, and possibly additional indications. He stated that it would be premature to discuss the design principles of the trials at this time, but they look forward to initiating the MARITIME Phase 3 program.
- James E. Bradner, the Chief Executive Officer of Amgen, explained that the MARITIME Phase 3 program is focused on chronic weight management, cardiovascular disease, kidney disease, Type 2 diabetes, sleep apnea, heart failure, and possibly additional indications. He stated that it would be premature to discuss the design principles of the trials at this time, but they look forward to initiating the MARITIME Phase 3 program.
- Analyst asked about the potential sales level of biosimilars and whether Amgen is getting enough credit for its work in this area.
- Robert A. Bradway, the Executive Chairman of Amgen, acknowledged that they are a world leader in biosimilars and have a focus on reliably supplying biosimilars when they are appropriately able to enter the market. He stated that their objective is to be amongst the first wave of biosimilar entrants, and they have achieved this with PAVBLU. However, he mentioned that they do not give product-specific guidance. Murdo J. Gordon, the Executive Vice President of Global Commercial Operations, added that they are pleased with the launch of PAVBLU and are the only biosimilar available in the market right now, representing an opportunity that they will capitalize on. He also mentioned that retina specialists are very enthusiastic and positive about the launch of PAVBLU, and they are pleased that Amgen is bringing yet another high-quality biosimilar in a prefilled syringe. Peter H. Griffith, the Chief Financial Officer, added that Amgen operates very efficiently, leverages the broader Amgen footprint, and believes they are earning attractive returns for their shareholders. He also mentioned that they have a 100% success rate of FDA approval once they enter the clinic and have cumulative biosimilar sales of $10 billion through 2024, on track to double 2021 sales to over $4 billion by the end of the decade.
- Robert A. Bradway, the Executive Chairman of Amgen, acknowledged that they are a world leader in biosimilars and have a focus on reliably supplying biosimilars when they are appropriately able to enter the market. He stated that their objective is to be amongst the first wave of biosimilar entrants, and they have achieved this with PAVBLU. However, he mentioned that they do not give product-specific guidance. Murdo J. Gordon, the Executive Vice President of Global Commercial Operations, added that they are pleased with the launch of PAVBLU and are the only biosimilar available in the market right now, representing an opportunity that they will capitalize on. He also mentioned that retina specialists are very enthusiastic and positive about the launch of PAVBLU, and they are pleased that Amgen is bringing yet another high-quality biosimilar in a prefilled syringe. Peter H. Griffith, the Chief Financial Officer, added that Amgen operates very efficiently, leverages the broader Amgen footprint, and believes they are earning attractive returns for their shareholders. He also mentioned that they have a 100% success rate of FDA approval once they enter the clinic and have cumulative biosimilar sales of $10 billion through 2024, on track to double 2021 sales to over $4 billion by the end of the decade.
- Analyst asked about the Phase 3 ROCKET program and what the company is looking for in the readouts to get comfortable with their competitive positioning in the atopic dermatitis market.
- The company is reading out several studies of the ROCKET program, including the eighth study with more than 3,300 patients, which will provide a lot of granularity around the target product profile, safety, and efficacy of rocatinlimab. The company is looking to generate a lot of information about the potential to contribute to a better therapy for atopic dermatitis and the tolerability profile.
- The company is reading out several studies of the ROCKET program, including the eighth study with more than 3,300 patients, which will provide a lot of granularity around the target product profile, safety, and efficacy of rocatinlimab. The company is looking to generate a lot of information about the potential to contribute to a better therapy for atopic dermatitis and the tolerability profile.
- Analyst asked about the cadence of biosimilar erosion for denosumab and how the company is thinking about it.
- The company has a clearer understanding of the timing of when biosimilars will enter the market, and the slope of the biosimilar erosion is expected to be more towards the back end. The company is in a good position given their participation in the biosimilar market and their experience in defending against other biosimilar competition. They have a large team of account executives that have been calling on their XGEVA and Prolia accounts for many years, and they are the bone market leader.
- The company has a clearer understanding of the timing of when biosimilars will enter the market, and the slope of the biosimilar erosion is expected to be more towards the back end. The company is in a good position given their participation in the biosimilar market and their experience in defending against other biosimilar competition. They have a large team of account executives that have been calling on their XGEVA and Prolia accounts for many years, and they are the bone market leader.
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