Skip to main content

Market Overview

Stiff Biosimilar Headwinds To Negatively Impact Amgen's Aging Drug Portfolio

Share:
Stiff Biosimilar Headwinds To Negatively Impact Amgen's Aging Drug Portfolio

Bernstein's Aaron Gal initiated Amgen, Inc. (NASDAQ: AMGN) at Market Perform and set a price target of $161. The company will have a hard time offsetting "stiff biosimilar headwinds," Gal noted.

Amgen has a very old drug portfolio with G-CSFs, ESAs and Enbrel accounting for over 100 percent of its net income. By 2020, Gal believes Amgen will lose $4.8 billion (22 percent of its revenue), as the market share of key drugs Neupogen, Neulasta, Epogen, and Enbrel will erode by 2020. "We have no reason to assume Sandoz would be able to overcome Biogen Inc (NASDAQ: BIIB)'s Enbrel IP, but the concern will likely weigh on the stock starting 2H17 as we approach a trial date," Gal noted.

Gal ended with a 2 percent revenue growth CAGR and a 5 percent EPS CAGR. Amgen has very little room to turn its trajectory around, as it has already committed 60 percent of its net income to investors and "has taken splitting the company off the table," Gal stated. The only major way to improve its position would be to use its cash and buy an OUS based company or merge with a similarly structured large cap company.

"Amgen is a large company facing a patent cliff and the remaining business does not have enough growth to change the trajectory," Gal concluded.

Latest Ratings for AMGN

DateFirmActionFromTo
Apr 2021OppenheimerMaintainsOutperform
Mar 2021BarclaysMaintainsEqual-Weight
Mar 2021Morgan StanleyMaintainsOverweight

View More Analyst Ratings for AMGN
View the Latest Analyst Ratings

 

Related Articles (AMGN + BIIB)

View Comments and Join the Discussion!

Posted-In: Analyst Color Biotech Long Ideas Health Care Price Target Initiation Analyst Ratings Trading Ideas

Latest Ratings

StockFirmActionPT
PPDBairdDowngrades48.0
OSPNSidoti & Co.Upgrades39.0
PLTSidoti & Co.Upgrades48.0
LRCXArgus ResearchMaintains725.0
ROSTLoop CapitalMaintains145.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
SPAC
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com