Amgen suffers another round of negative news
Amgen Inc.’s annus horribilis continues.
On Friday, the Thousand Oaks-based biotech giant received a series of bad news that follows negative developments in recent months.
First, experts from the European Union’s drug regulator recommended that the company’s high-profile cancer drug Vectibix not be approved, dealing the company another financial and psychological blow.
Separately, Swiss drug maker Roche Holding announced Friday that the European body was recommending approval for its new anemia drug Mircera in patients with chronic kidney disease, just a week after the U.S. Food and Drug Administration stopped short of giving the drug full approval.
The medication, which is now likely to get European approval this summer and may get U.S. approval soon after, is a direct competitor to Amgen’s highly profitable anti-anemia medication Aranesp.
Meanwhile, data released Friday showed that sales of Aranesp -- one of the company’s top-selling medications -- are eroding faster than recently predicted, threatening the company’s revenue outlook.
Monthly prescription sales data for April compiled by NDC Health Information Services showed that daily Aranesp sales declined 16% and total units declined 13% from March.
However, investors took the setbacks in stride, reinforcing some analysts’ views that Amgen’s stock already had factored in bad news. The shares, which are down 20% this year, dropped 2 cents to close at $54.55 on Friday.
Several recent studies have raised questions about the safety of Aranesp and its shorter-acting predecessor Epogen in some patients and dosages. This month an FDA advisory panel recommended that the agency change the drugs’ labels and lower recommended dosages for some patients.
The federal Medicare agency followed days later with an announcement that it might scale back reimbursements for the drugs soon.
The drugs treat anemia in more than 1 million cancer and dialysis patients a year.
Few experts expected the drugs’ sales to fall so rapidly so soon.
“Their sales numbers were atrocious,” said Robert W. Baird & Co. biotech analyst Christopher Raymond, who recently downgraded the stock from “outperform” to “neutral.”
Raymond said the European news was “important but not yet lethal” because European sales for Vectibix were expected to be $25 million this year compared with $200 million in the U.S. He said he believed Micera’s approval on both sides of the Atlantic could take longer than some predict.
Vectibix, a cutting-edge cancer therapy, won FDA approval last September to treat late-stage colon cancer patients.
The drug, viewed as a key medicine in Amgen’s development pipeline, is part of a new generation of cancer therapies known as monoclonal antibodies. They induce an immune response against a cancer cell by targeting individual growth factors rather than the whole tumor.
In a statement, Amgen said it would appeal the European decision by the Committee for Medicinal Products for Human Use. There are precedents for companies appealing and overturning committee decisions. Last year Roche appealed the recommendation not to approve Tarceva for pancreatic cancer.
Dr. Randy Hecht, a gastroenterologist and oncologist at UCLA’s Jonsson Comprehensive Cancer Center, said he believed that the company would eventually succeed in reversing the panel’s decision because the drug is so similar to Erbitux, a late-stage colon cancer drug sold by ImClone Systems Inc. and Bristol-Myers Squibb Co. that is approved in Europe and the U.S.
“There is no reason for them not to approve” Vectibix. “It essentially does the same thing as Erbitux,” he said.
The London-based European Medicines Agency said its committee was concerned that there wasn’t sufficient evidence to show a benefit of Vectibix.
Though many stock analysts have turned on Amgen in recent weeks, several remain positive.
“Some of the chips will eventually fall their way, and they have some strong fundamentals,” said Shiv Kapoor, a biotech analyst at Montgomery & Co.
Several of the company’s pipeline drugs look promising, including its osteoporosis drug Denosumab and a late-stage drug candidate for lung and breast cancer.
