After posting a 4% rise in adjusted net income for the fourth quarter to $1.1 billion, Amgen has announced it is to acquire BioVex Group in a deal that could cost the US biotech giant up to $1 billion.
First up, the financials and turnover edged up 1% to $3.84 billion. The figures reflect a decline in revenues from its anaemia drug Aranesp (darbepoetin alfa), down 21% to $633 million and its older erythropoiesis stimulating agent, Epogen (epoetin alfa), which fell 16% to $591 million. Combined turnover of Amgen’s white blood cell stimulators Neulasta (pegfilgrastim) and Neupogen (filgrastim) increased 3% to $1.24 billion, while sales of the anti-inflammatory Enbrel (etanercept), partnered with Pfizer’s Wyeth unit and sold by Amgen in North America, were up 3% at $939 million.
Sensipar/Mimpara (cinacalcet), for the treatment of secondary hyperparathyroidism in dialysis patients, rose 10% to $188 million, while sales of the colorectal cancer drug Vectibix (panitumumab) leapt 20% to $79 million. Nplate (romiplostim), for the treatment of chronic immune thrombocytopenic purpura, increased 59% to $65 million.
Analysts were a bit disappointed with sales of Prolia (denosumab) which was approved last year in the USA and Europe for the treatment of postmenopausal women at increased risk of osteoporotic fractures. It brought in just $20 million, although Xgeva (also denosumab), which was approved in November for the treatment of bone metastases to reduce skeletal related events in patients with cancer, contributed $8 million.
Amgen chief executive Kevin Sharer said the firm had delivered solid earnings growth while absorbing the impact of health care reform in the USA, a factor which hit fourth-quarter earnings by $65 million. He added that "our priorities in 2011 are to make Prolia and Xgeva successes, advance and enrich our pipeline".
That has started with the proposed acquisition of BioVex a privately-held, venture-funded company headquartered in Woburn, Massachusetts. It employs 60 people there and has 30 employees in Abingdon, UK.
The attraction of the latter is that it is developing a novel oncolytic vaccine which is in Phase III and "may represent a new approach to treating melanoma and head and neck cancer".
Under the terms of the agreement, Amgen will pay up to $1 billion, ie $425 million in cash at closing and up to $575 million in additional payments upon the achievement of certain regulatory and sales milestones. The transaction has been approved by the boards of directors of each company, and is expected to close in the first quarter.
Amgen reported $17.4 billion in cash and equivalents at the end of 2010 and on a conference call, Mr Sharer said more "intelligent acquisitions” could be on the cards. He added: "We have a belief that if you don’t invest money in R&D you can’t succeed in this business,” saying that "one should expect Amgen to continue to make further in-licensing pipeline deals for the rest of the year”.