Sales of Amgen's New Anemia Drug May Not Be So Sanguine

U.S. drug regulators finally approved Amgen's(AMGN Quote) antianemia drug Aranesp on Tuesday. But if you're expecting Aranesp sales to turbocharge Amgen's growth, guess again.

Aranesp is a glorified me-too drug that is being hyped by Wall Street to justify Amgen's position atop the biotech mountain. Investors who played Aranesp's approval for the trade over the past couple of months made a smart call. Now, however, it's time to proceed with extreme caution.

Amgen developed Aranesp to be a longer-acting version of its current red blood cell-boosting drug, Epogen, with which it shares marketing rights with Johnson & Johnson(JNJ Quote). The biotech sold $1.9 billion worth of Epogen last year, even though it's restricted to selling the drug only to U.S. kidney-dialysis patients suffering from anemia. J&J sold another $2.7 billion of the drug under the name Procrit last year here and abroad for the treatment of early stage kidney disease and for cancer (J&J got the better of the co-marketing deal, but more on that later).

Epogen/Procrit is the bestselling biotech drug ever created, so naturally, Amgen bulls believe that the Son of Epogen -- Aranesp -- will be another multibillion-dollar product for the company, especially because it doesn't have to share sales with J&J this time.

Well, Aranesp might meet these lofty expectations one day, but it's not going to happen quickly, nor will it happen without a serious fight from J&J. ...