Blockbuster Anemia Drug Wins Approval : Thousand Oaks Firm Gets OK on Kidney Compound

The Food and Drug Administration today approved an anti-anemia drug made by Amgen Inc., giving the California firm an edge in the race to market what some analysts are calling biotechnology’s next blockbuster drug.

The approval of erythropoietin, or EPO, which would treat anemia linked to kidney diseases and other ailments, also should take Amgen out of the red and bring it back to profitability, company officials and industry analysts said.

“Amgen is ready to roll,” said Viren Mehta, an analyst at S. G. Warburg. “It will probably have a significant number of dialysis centers stocked within a number of days.”

Mehta said he expects about a quarter of the nation’s kidney dialysis patients who depend on transfusions will use the drug. “There will be a dramatic impact on the bottom line,” he added.

The FDA said Amgen’s EPO will be classified as an orphan drug in a program for medicines aimed at rare diseases. It will thus be entitled to special tax breaks. EPO is the first Amgen product to be approved by the federal drug agency.

‘Will Return to Profitability’

“We will return to profitability as a result of this action,” Amgen Chief Executive Gordon Binder told reporters after the FDA announcement.

Shares in the Thousand Oaks-based firm jumped $1.625 to $41.75 in over-the-counter trading as investors agreed the FDA’s approval would reverse the company’s fortunes.

“This is going to be fabulous,” said analyst Stuart Weisbrod at Prudential-Bache Securities. He said the drug could lead to an explosion in Amgen’s sales to as much as $80 million this year, compared with only $2.7 million in 1988.

EPO has been described by some analysts as biotechnology’s next blockbuster drug because it has many potential uses, including the treatment of anemia associated with cancer chemotherapy and use of the AIDS drug AZT.

Researchers say the drug reverses a debilitating form of anemia that is often triggered by dependence on an artificial kidney. About 100,000 Americans with severe kidney disease, and 300,000 other people around the world, require dialysis by an artificial kidney to remain alive. About three-quarters of these suffer from anemia and are thought to be candidates for EPO therapy.