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Amgen
CEO Gives Update, Discusses Patent Dispute with Roche
February
8, 2007--Amgen
Chairman and CEO Kevin Sharer took the podium at the
Merrill Lynch Global Pharmaceutical, Biotechnology and
Medical Device Conference in
New York
last Thursday. Sharer opened the session by saying the
company is proud of what it delivered in 2006. Its
2006 revenue and adjusted earnings per share grew an
impressive 15% and 22%, respectively. The period also
saw the launch of Vectibix (panitumumab) for the
treatment of EGFR-expressing metastatic colorectal
cancer, with early results beating expectations.
Also
in 2006, Amgen closed the acquisitions of Abgenix and
Avidia; it also struck a collaboration with
Cytokinetics in the cardiovascular space. Said Sharer,
this set of results and activities is a real
expression of Amgen’s strategy for trying to develop
innovative medicines for grievous illnesses: to reach
outside the company when they can while fundamentally
pursuing organic growth with a heavy R&D
investment-based strategy. When it comes to M&A
activity, “Our first preference is to in-license the
molecule. If we need to buy a company to get the
molecule, then we do it,” said Sharer, using Abgenix
as an example. “But we don’t have any desire to
try to change the nature of our company through some
major transaction,” explaining that Amgen’s focus
is on getting good products, and that, historically,
half its pipeline has come from outside the company. “I
think that’s healthy. We’re constantly looking
outside the company and—within reason—will pay up
for good opportunities,” said Sharer.
Amgen
is projecting solid growth in 2007, estimating total
revenue will be in the range of $15.4–16 billion
(8–12% growth), and anticipating adjusted earnings
per share to range from $4.30–4.50 (10–15%
growth).
Sharer
updated the progress of a few of Amgen’s pipeline
drugs, noting positive results from its AMG 531 (an Fc-peptide
fusion protein) immune
thrombocytopenic purpura (ITP) and AMG 706 (motesanib
diphosphate) thyroid cancer trials. Negative results
were reported from its Aranesp (darbepoetin
alfa) anemia of cancer trial. Also of
potential concern to investors is Vectibix’s
response-rate data from the PACCE study.
Tackling
Aranesp’s utility in anemia of cancer, Sharer noted
that this off-label indication of the drug might
actually account for as much as 10% of Aranesp’s
sales (Aranesp is labeled for chemotherapy-induced
anemia). The disappointing Phase III study evaluated
anemic patients with active cancer, who were not
receiving chemotherapy or radiotherapy, and showed
there was a higher death risk in the Aranesp arm of
the trial. Sharer points out that the study population
was comprised of very sick patients—approximately
60% of patients had advanced (Stage IV) disease. He
emphasized that this study and its results are
unrelated
to Aranesp’s on-label indication for
chemotherapy-induced anemia.
Next
up: Vectibix, which is performing well on the market
for its labeled indication. However, response-rate
data from the PACCE (Panitumumab Advanced Colorectal
Cancer Evaluation) study (evaluating Vectibix in
first-line treatment of metastatic colorectal cancer
with or without bevacizumab plus chemotherapy) did not
address the primary end point of progression-free
survival. However, there were no unexpected adverse
experiences. An interim analysis of safety and
efficacy (including progression-free survival after
25% of events have accrued) is expected to be
available in the second quarter of 2007. Enrollment is
underway for first- and second-line colorectal cancer
registrational trials. “PACCE is not the be all and
end all for Vectibix,” Sharer said about exploring
other Vectibix trials. “I’m confident the clinical
data are there and we’ll be able to deliver in the
market place.”
Sharer
also talked about Amgen’s patent dispute with Roche.
Amgen has filed a lawsuit in federal court against
Roche, claiming that Roche’s anemia treatment
Mircera
(currently under FDA review with a decision expected
around May) violates Amgen patents. Roche’s CEO has
said that if Mircera is approved, they will launch the
drug regardless of the ongoing patent dispute. “If
Roche launches, they will certainly get business,”
said Sharer, noting it’s impossible to hold 100%
market share forever. “But we think we have good
defenses,” adding that Amgen’s 2007 guidance is
wider than normal because “we’ve put in our own
thinking about what might happen.”
The
trial is scheduled to begin September 7. In the
meantime, Amgen has the option to ask for a
preliminary injunction that would prevent Roche from
selling Mircera in advance of the trial, in the event it is
approved. Amgen is carefully considering the potential
ramifications of such a move and has not decided
whether or not it will seek the preliminary
injunction. “The judge may not want to hear the case
twice [once for deciding on the preliminary injunction
and again when the case goes to trial],” Sharer
explained. “And if a preliminary injunction were
denied, that would put pressure on the stock.” He is
confident that Amgen will win in court.
URL: http://www.pharmadd.com/topnews/February
8 2007.asp
Copyright
2007, Cambridge Healthtech Institute. All Rights
Reserved.
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