sorry for the late response. I guess you have seen the positive articles in the last few days regarding AMGN......everything looks green from here. Profit takers will come in for sure but from where? New highs ....new highs...new highs. Don't cha love it?
Thursday March 11, 8:21 pm Eastern Time
Amgen shares jump as analysts sense growth spurt
By Mark Egan
LOS ANGELES, March 11 (Reuters) - Shares of Amgen Inc. rose 7 percent on Thursday to an all-time high after signals that sales of the leading biotechnology company's two blockbuster drugs were growing faster than analysts had thought.
Shares of Amgen, which makes the billion-dollar drugs Epogen, for kidney dialysis patients, and Neupogen, for cancer and AIDS patients, was $4.81 higher at $75.625 Thursday afternoon in trading on Nasdaq.
The surge followed an announcement on Wednesday that the world's biggest biotech concern would invest in a prostate cancer drug and still meet earnings expectations for the year.
The Thousand Oaks, Calif.-based company said it would collaborate with Praecis Pharmaceuticals Inc. to commercialize a drug, called abarelix, that it hopes can treat prostate cancer and other illnesses.
Amgen said the collaboration would add $100 million to its expenses for 1999 and that total product sales would grow in the mid to high teens in 1999.
Even after the higher expenses, Amgen said, it is comfortable with the current range of analysts' fiscal 1999 earnings estimates of $1.80 to $1.85 a share.
That comment, more than the announcement of the collaboration, led analysts to believe that sales of Amgen's existing drugs were going better than previous forecasts. And given Amgen's usually cautious stance on earnings forecasts, some analysts said the company could even beat those numbers.
''Management has been guiding analysts to view earnings in a cautious way,'' said Gruntal & Co. analyst David Saks. ''The company is now basically saying that in spite of spending an extra $100 million they still feel comfortable with the earnings range and ... reading between the lines, I'm saying they're (hinting) they're even going to beat that range.''
Saks raised his 1999 earnings estimate to $1.85 a share from $1.84, his 2000 estimate to $2.10 from $2.06 and his 2001 number to $2.40 from $2.35.
He also placed a one-year price target of $88 a share and said the stock could reach $100 by the middle of 2000.
Saks said he now expected 1999 sales of Epogen, the company's red blood cell stimulator, to grow 22 percent to $1.68 billion, up from a previous forecast of 19 percent growth. He forecast sales of Neupogen, the company's white blood cell stimulator, to gain 8 percent to $1.2 billion, up from a previous forecast of a 6 percent growth.
Everen Securities cut its intermediate-term rating on Amgen to market performer from outperform, based on the current stock valuation, but maintained its long-term outperform opinion.
Analysts said the addition of abarelix, currently in late-stage clinical trials, could also boost potential revenues with the market for that drug estimated at anything from $50 million to $400 million depending on its effectiveness.
Abarelix, known as a GnRH antagonist, inhibits the action of gonadotropin-releasing hormone (GnRH) on the pituitary gland, thereby reducing the production of testosterone in men and estrogen in women. The approach benefits patients with a number of diseases and medical conditions including prostate cancer and endometriosis.
In phase II studies, abarelix was shown to reduce testosterone to very low levels in the great majority of men within the first week of treatment. Currently available drugs cause an initial surge in testosterone levels that can stimulate cell growth in prostate cancer.
Amgen, with 1998 sales of $2.2 billion, has in recent months been looking for acquisitions and collaborations to boost its product line since it has yet to find a third drug to match its two blockbusters, Epogen and Neupogen.
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