Tuesday October 27, 4:14 pm Eastern Time
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Company Press Release
Amgen Reports Solid Third-Quarter Results and Announces Additional $1 Billion Stock Repurchase
THOUSAND OAKS, Calif.--(BUSINESS WIRE)--Oct. 27, 1998--Amgen (Nasdaq:AMGN - news) Tuesday announced that earnings per share for the third quarter ended Sept. 30, 1998 increased 168 percent, to $0.83 compared to $0.31 for the third quarter a year ago.
Earnings per share in the third quarter of 1997 included a charge of $0.35 per share relating to a spillover arbitration award to Ortho Pharmaceuticals. Excluding that charge, earnings per share for the third quarter of 1998 would have increased 26 percent.
Net income for the third quarter of 1998 increased 164 percent, to $221 million, from $84 million for the third quarter of 1997, including the one-time charge. Without that charge, net income would have increased 23 percent.
Product sales increased 16 percent for the third quarter, to $642 million from $553 million.
Sales of EPOGEN(R)(Epoetin alfa) increased 23 percent, to $350 million from $285 million. Sales of NEUPOGEN(R)(Filgrastim) increased 7 percent, to $287 million from $268 million. Sales of INFERGEN(R)(Interferon alfacon-1), which was approved by the Food and Drug Administration in October 1997, were $5 million in the third quarter.
''We are particularly pleased with the strong growth in sales of EPOGEN. Increased doses of EPOGEN move more patients into the recommended level of red blood cells, which results in improved outcomes and better quality of life for dialysis patients,'' said Gordon Binder, chairman and chief executive officer.
Amgen has completed its $1 billion stock repurchase program announced in October 1997. Amgen's Board of Directors has authorized the additional repurchase of up to $1 billion in Amgen common stock through the end of 1999.
Progress was made during the quarter on a number of research and development programs. Results from two phase 2 clinical trials of Amgen's novel erythropoiesis stimulating protein (NESP), presented yesterday at the annual meeting of the American Society of Nephrology, showed that NESP safely and effectively raises the level of red blood cells in anemic dialysis patients.
The initial analysis of preliminary three-month clinical data from two native leptin phase 2 studies in obese subjects demonstrated that there was no statistically significant difference between native leptin and placebo for the study population as a whole in either phase 2 study at three months. However, significant weight loss was achieved for a commercially attractive subset of subjects. Patients in the subset in which leptin appeared to have a clinically meaningful effect at three months can be identified prior to treatment. Amgen plans to conduct an additional phase 2 trial to confirm and further evaluate this subset of patients. Development of second-generation leptin molecules to achieve higher deliverable doses is continuing.
Also, during the quarter, Amgen began a phase 1 clinical trial of osteoprotegerin (OPG), a recombinant version of a naturally-occurring protein that appears to be a critical regulator of bone mass. The clinical trial is designed to evaluate the safety of OPG in healthy, post-menopausal women.
Earlier this month, a phase 2 trial designed to evaluate the safety and efficacy of Calcimimetics in normalizing parathyroid hormone and circulating calcium levels was begun in patients with primary hyperparathyroidism. This disease affects more than 500,000 Americans, and surgery is the only current treatment option.
This news release contains forward-looking statements that involve risks and uncertainties, including risks associated with sales, preclinical and clinical development, regulatory and reimbursement matters and other risks described from time to time in the SEC reports filed by Amgen, including the recently-filed Form 10-Q.
Amgen is a global biotechnology company that discovers, develops, manufactures and markets cost-effective human therapeutics based on advances in cellular and molecular biology.
Amgen Inc.
Condensed Consolidated Statements of Operations
(In millions, except per share data)
(Unaudited)
Three Months Ended Nine Months Ended
Sept. 30, Sept. 30,
1998 1997 1998 1997
Revenues:
Product sales $641.8 $552.8 $1,819.8 $1,655.5
Corporate partner
revenues 38.4 30.8 90.9 98.2
Royalty income 20.7 14.7 52.5 40.6
Total revenues 700.9 598.3 1,963.2 1,794.3
Operating expenses:
Cost of sales 87.2 74.3 250.1 223.1
Research and development 166.0 172.6 470.9 465.7
Marketing and selling 80.2 73.2 221.3 223.1
General and administrative 54.0 46.2 148.0 134.3
Loss of affiliates, net 4.3 4.1 20.7 24.7
Legal assessment -- 157.0 -- 157.0
Total operating expenses 391.7 527.4 1,111.0 1,227.9
Operating income 309.2 70.9 852.2 566.4
Other income/(expense):
Interest and other income 16.1 17.5 55.2 51.4
Interest expense, net (3.2) (0.1) (8.7) (0.8)
Total other income/
(expense) 12.9 17.4 46.5 50.6
Income before income taxes 322.1 88.3 898.7 617.0
Provision for income taxes 101.1 4.5 274.1 152.4
Net income $221.0 $83.8 $624.6 $464.6
Earnings per share:
Basic earnings per share $0.87 $0.32 $2.45 $1.75
Diluted earnings per
share $0.83 $0.31 $2.37 $1.68
Shares used in calculation of:
Basic earnings per share 255.1 264.7 255.2 265.3
Diluted earnings per
share 265.0 273.9 264.0 276.1
Amgen Inc.
Condensed Consolidated Balance Sheets
(In millions)
(Unaudited)
Sept. 30, Dec. 31,
1998 1997
Assets
Current assets:
Cash and marketable securities $1,124.9 $1,026.5
Trade receivables 296.3 269.0
Inventories 109.1 109.2
Other current assets 166.1 138.8
Total current assets 1,696.4 1,543.5
Property, plant and equipment, net 1,398.0 1,186.2
Other non-current assets 349.6 380.5
Total assets $3,444.0 $3,110.2
Liabilities and Stockholders' Equity
Current liabilities $ 875.0 $ 741.9
Non-current liabilities 223.0 229.0
Stockholders' equity 2,346.0 2,139.3
Total liabilities and stockholders'
equity $3,444.0 $3,110.2
Shares outstanding 254.5 258.3
EDITOR'S NOTE: An electronic version of this news release may be accessed via the company's web site at www.Amgen.com. Visit the Corporate Center and click on Amgen News. Journalists and media representatives may sign up to receive all news releases electronically at time of announcement by filling out a short form in the Amgen News section of the web site.
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Contact:
Amgen, Thousand Oaks
David Kaye, 805/447-6692 (media)
Denise Powell, 805/447-4346 (investors) |
