Amgen Inc. shares rose 6% on Thursday after the Clinton administration eased Medicare reimbursement guidelines for its blockbuster anti-anemia drug, Epogen.
Thousand Oaks-based Amgen relies on Epogen for about half of its revenue, and most of that comes from Medicare. The change in rules for reimbursement took effect Tuesday, a Medicare spokesman said.
The change "is likely to propel [Epogen] back to double-digit growth rates," Meirav Chovav, analyst at Salomon Smith Barney, wrote in a report. She had been projecting Epogen sales growth of about 7% this year and 8% in 1999.
Amgen shares rose $3.38 to close at $58.38 in heavy trading on the Nasdaq.
This week's action relaxes Medicare's decision last September to impose strict guidelines for coverage of Epogen to treat anemia in kidney patients. The guidelines made certain patients ineligible for coverage of Epogen, which generates more than $1 billion a year in revenue. Some of those patients will now be eligible.
Amgen, for its part, said it couldn't comment on what impact the changes might have.
The company had been lobbying Congress heavily to ease the restrictions.