Amgen's ( AMGN) first-quarter earnings report, due Thursday, probably won't look very pretty.

At best, the company will post a modest increase in profits and revenue that matches Wall Street's expectations. However, an earnings miss, spurred by disappointing sales of two or three of its key drugs -- Aranesp, Epogen and Enbrel -- seems to be the consensus view of analysts and investors heading into Thursday's report.

The expectations for weak first-quarter earnings have weighed on Amgen's stock price, down 22% for the year. Amgen was falling 0.8% to $45.70 in recent trading.

Biotech Select

Amgen is expected to grow first-quarter earnings by 3% to $1.15 a share on total revenue of $3.64 billion growing 1% year over year, according to Thomson Reuters.

Worldwide sales of the company's anemia drug Aranesp are expected to fall about 5% sequentially to $669 million, while sales of Enbrel, which is mainly used to treat rheumatoid arthritis and psoriasis, are expected to drop 1% to $908 million, according to analysts' consensus estimates.

Prescription tracking data for the first two months of the year suggest sales of Aranesp, Enbrel, or both, could sink even further below already-lowered Wall Street expectations. Amgen has previously warned of a reduction in worldwide Aranesp sales due to new safety-related label restrictions mandated by regulators in the U.S. and Europe. Less expensive copycat versions of Aranesp -- so-called biosimilars -- are also being marketed by competitors in Europe.

The headwinds hitting Enbrel include strong competition from other rheumatoid arthritis drugs, including Abbott Labs' ( ABT) Humira, as well as the recession, which is forcing some patients to delay or forgo expensive treatments for non-life threatening diseases like rheumatoid arthritis.

Last Wednesday, Abbott reported lower-than-expected Humira sales for the first quarter.

At this point, Wall Street is only looking for Amgen to grow 2009 earnings by 2%. The hope is that real growth will return in 2010 with the approval and launch of denosumab -- first for osteoporosis and then for cancer treatment-induced bone loss.

The U.S. Food and Drug Administration is reviewing denosumab for osteoporosis with an approval decision expected in October. The first of several phase III cancer studies -- a head-to-head trial of denosumab compared with Novartis' ( NVS) Zometa in breast cancer patients -- is expected to report results in the third quarter.
At the time of publication, Feuerstein's Biotech Select model portfolio was long Amgen.

Adam Feuerstein writes regularly for TheStreet.com. In keeping with TSC's editorial policy, he doesn't own or short individual stocks, although he owns stock in TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. Feuerstein appreciates your feedback; click here to send him an email.

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