Amgen’s Profit Surges 38% in Quarter

Amgen Inc. reported Tuesday that its second-quarter profit had risen sharply, beating Wall Street expectations, because of strong drug sales. The biotechnology titan also increased its already rosy financial outlook for the year.

The Thousand Oaks company reported a profit of $1 billion, or 82 cents a share, an increase of 38% from the previous year’s second-quarter profit of $748 million, or 57 cents. Revenue rose 23% to $3.2 billion.

Amgen said its second-quarter earnings would have been $1.1 billion, or 88 cents a share, if it had not incurred special charges related to its acquisition of rival Immunex Corp. and other one-time expenses.

On that basis, the earnings beat Wall Street analysts’ expectations by 16 cents a share, according to Thomson First Call.

The earnings were released after the close of regular trading. Amgen shares gained 2 cents to $70.52. In after-hours trading, the shares soared $5.22, or 7.4%, to $75.74, topping their 52-week high.

Analysts were unanimously laudatory during a conference call with company executives after the release of the results.

“A phenomenal quarter,” said Matt Geller, an analyst with CIBC World Markets.

Amgen said it was beating rival Johnson & Johnson in the battle to provide anemia relief to chemotherapy patients. It also said fears that Medicare reimbursement changes would hurt sales of its cancer drugs had not materialized.

“This strong performance gives us confidence for the rest of the year,” Chief Executive Kevin Sharer said.

The company said it now expected to earn $3.10 to $3.20 a share in 2005, increasing its guidance from the $2.80-to-$2.90 range it issued three months ago.

Just six months ago, the company ratcheted down its financial guidance over concern that doctors would prescribe less of the company’s cancer drugs because of the Medicare billing changes.

But “we found a way to work with physicians,” Sharer said.

Sharer said the company’s financial performance during the three months that ended June 30 “was one of the most impressive quarters we ever had.”

The company’s stock price has risen almost 20% since April, when it first announced that the Medicare changes wouldn’t hamper sales.

J&J; reported Tuesday that sales of its two anemia fighters fell 5%; Amgen’s flagship anti-anemia drugs Epogen and a next-generation, longer-lasting version called Aranesp had combined sales of $1.5 billion in the quarter, a 20% increase compared with $1.25 billion in sales a year earlier.

Patients suffering from anemia because of kidney disease and chemotherapy take the two drugs to raise the number of oxygen-rich red blood cells in their bodies. The drugs also are abused by many elite athletes, especially bicyclists, because they help boost endurance.

Combined sales of the company’s two drugs that prevent infection in chemotherapy patients, Neulasta and Neupogen, rose 25% to $899 million in the second quarter.

Sales of Amgen’s rheumatoid arthritis drug, Enbrel, rose to $639 million in the quarter, a 45% increase over the same period last year.