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Biotech / Medical : Amgen Inc. (AMGN) -- Ignore unavailable to you. Want to Upgrade?

To: steve kammerer who wrote (1520)	7/18/2007 12:44:25 PM
From: Ray Rueb	Respond to of 1906

AMGN sales of Aranesp eat into J&J's Procrit Sales >> To: e_blastman who wrote (1519) 7/17/2007 11:22:36 AM >> From: steve kammerer of 1521 >> Uh-oh. J&J's sales of Procrit in the US down 14% during second quarter. This might be a bad interpretation of the data guys - this could mean Amgen's sales of Aranesp is up 20% What interests me more is that for the last months Amgen has had a hiring freeze and is undergoing an expense reduction program. This is what will affect the bottom line for this quarter. The real issue is that the future of the epo franchise IN CANCER treatment will be determined in September by the FDA. I believe most of Amgen's epo revenue comes from anemia which shouldn't be affected. Data from the annual report says 2006 Epogen sales were 2.5 bln but this was mostly anemia sales since epo is sold for cancer in US by J&J. So what's at risk is some portion of the 2.8 bln US Aranesp sales that are from the cancer segment. What amount is that? Just look at Procrit sales declines over the last 2 years and you'll see the Aranesp cancer segment sales. So let's just say for argument's sake that what Amgen can lose is $2 bln in US Aranesp sales. Here is the formula I want to use (after plugging in a modest 15% sales growth in all other drugs) 2006 total revenues of 14.3 bln minus 2 bln for lost Aranesp in Cancer equals 12.3 bln times modest 15% sales growth gives us 14.15 bln for an equiv year after the product loss. Is that so bad??? But a negative announcement will seem much worse for Amgen and idiots will panic and sell we'll have a true fire sale going on - time to back up the truck and load up and wait for the denosumab results and later denosumab sales. Personally, I dumped my shares and bought an equivalent amount of 09 and 10 leaps. If a fire sale hits, I'll double or triple my position again using 09 and 10 leaps. You all be careful out there Ray