Updated from 5:37 p.m. EDTAmgen ( AMGN) surged past analysts' third-quarter profit expectations Wednesday, with some help from foreign exchange rates and an accounting change, and the biotech company raised its full-year profit and revenue outlook. Shares were up $2.80, or 5.6%, at $52.50 in recent post-market trading. Amgen earned $1.23 a share in the quarter, up from $1.08 a year prior, on an adjusted basis, while revenue rose 7% to $3.88 billion. Those results surpassed the average expectation of analysts, who were looking for $1.08 a share on revenue of $3.7 billion. Safety, reimbursement and regulatory concerns have in recent years jolted Amgen's anemia drug sales and quarterly revenue. But last quarter, Amgen beat earnings expectations, fueled by better-than-expected sales of anemia drugs Aranesp and Epogen. The Food and Drug Administration has since announced label changes for the class of medications that includes Aranesp and Johnson & Johnson's ( JNJ)Procrit. Third-quarter product sales again beat expectations, though Amgen received some aid. The company reported $845 million in worldwide sales of Aranesp, up from $818 million in the third quarter of the year prior. However, U.S. Aranesp sales were lifted by $54 million thanks to an accounting change. Amgen that without the change, U.S. sales would have declined 12%. The drop, which was slightly offset by price increases, reflects the damage done to demand by regulatory, reimbursement and label alterations. Without the help of favorable foreign-exchange rates, Amgen said international sales of Aranesp decreased 2%. All told, worldwide sales of Aranesp, excluding the accounting change and benefit from foreign exchange, dropped 8% year over year.
Amgen reported $634 million in sales of Epogen, while analysts had expected $610 million. Amgen said the 7% increase year-over-year increase was due primarily to an increase in the product's sales price, beneficial changes in wholesale inventory levels and revised estimates of dialysis demand. Turning to other products, Amgen sold $893 million of Enbrel, beating the expectation for $855 million, and $1.19 billion of Neupogen and Neulasta, in line with estimates. Looking ahead, Amgen now expects slightly lower research and development expenses for the year, and it's now forecasting an adjusted profit in the range of $4.45 to $4.55, on revenue of $14.9 billion to $15.2 billion. Amgen previously projected a profit of $4.25 to $4.45 a share, with revenue of $14.6 billion to $14.9 billion. The new guidance surpasses the Thomson Reuters consensus targets of $4.38 a share and revenue of $14.82 billion. "We view these results as a relief," said Citi analyst Yaron Werber. Amgen is holding a business review meeting on Nov. 7. Investor focus remains on Amgen's late-stage bone-drug denosumab, it's most promising pipeline product. Positive data were announced earlier this year in women with postmenopausal osteoporosis, and additional findings should be available in the coming months. "It was a very good quarter from a
profit statement perspective," said JP Morgan analyst Geoffrey Meacham. "But the stock performance hinges more on denosumab data in 2009, as well as their investor meeting in November." Nobody ever made a dime by panicking, says Jim Cramer. Moneymaking opportunities exist despite the market turmoil. So where's a market master like Cramer putting his money these days? Check out his personal portfolio at Action Alerts PLUS. Take a free trial now.