Amgen 'encouraged' by weight-loss drug interim data, shares jump

By Deena Beasley

(Reuters) -Amgen on Thursday said it was very encouraged after completing an interim analysis of its mid-stage study of experimental weight-loss drug MariTide and will no longer develop its oral obesity candidate AMG786.

Shares of Amgen surged 13% in after hours trading.

Investors are focused on Amgen's pipeline of experimental weight-loss drugs, and the company said it expects to have data from the Phase 2 MariTide trial late this year. Amgen also said it is planning "for a comprehensive Phase 3 program across multiple indications," including diabetes.

MariTide, given by injection, links a compound designed to activate the GLP-1 hormone associated with a feeling of fullness to an antibody that blocks activity of a different gut hormone, GIP, that has been linked to fat storage and metabolic regulation.

"Following the interim analysis, I would say we're confident in MariTide's differentiated profile and believe it will address important unmet medical needs," Amgen Chief Scientific Officer Jay Bradner said on a conference call.

If eventually approved, MariTide would compete with Novo Nordisk's Wegovy and Eli Lilly's Zepbound, which have been unable to keep up with explosive demand in a market some analysts see exceeding $100 billion by decade's end.

"Even modest market share assumptions in this large market may make investors more and more comfortable," although Lilly and Novo will still dominate the sector, Evercore ISI analyst Umer Raffat said in a research note.

Bradner added that "given the profile we have seen with AMG786, we will not pursue further development."

The company had not disclosed the design of AMG786, saying only it was an oral compound that does not target hormones like GLP-1 or GIP.

Amgen also reported a slightly lower first-quarter profit on Thursday, citing higher operating and interest expense from its recent acquisition of rare disease drugmaker Horizon Therapeutics, partially offset by double-digit revenue growth.

The biotechnology company's adjusted profit fell 1% to $3.96 per share, which still beat the average analyst estimate of $3.88 per share, according to LSEG data.

Revenue rose 22% to $7.45 billion, in line with analysts' estimates of $7.44 billion.

Quarterly product sales were led by an 8% jump for osteoporosis drug Prolia to $999 million, and a 33% increase to $517 million for cholesterol drug Repatha. Sales of rheumatoid arthritis drug Enbrel fell 2% to $567 million.

Sales of eye drug Tepezza, which Amgen acquired through its Horizon purchase, rose about 5% to $424 million.

Excluding Horizon's medications, Amgen said year-over-year product sales grew 6%.

For full-year 2024, the company nudged up the lower end of its revenue outlook to between $32.5 billion and $33.8 billion from a previous view of $32.4 billion to $33.8 billion.

Amgen narrowed its 2024 adjusted earnings estimate and now expects a profit of $19.00 to $20.20 per share, from a previous view of $18.90 to $20.30.

Analysts have forecast 2024 earnings per share of $19.50 on revenue of $33 billion.

Amgen expects to hear by mid-June whether the U.S. Food and Drug Administration will grant accelerated approval to targeted immunotherapy tarlatamab for treating adults with advanced small cell lung cancer that has worsened despite chemotherapy.

(Reporting By Deena BeasleyEditing by Bill Berkrot and David Gregorio)