Amgen (AMGN - Get Report) reported mixed results on Wednesday as sales for its cornerstone RA and psoriasis drug Enbrel slid 15%, to $1.8 billion, while revenue guidance for the year remained unchanged. Investors registered their displeasure as after-hours trading saw shares drop more than 3%.
The company's revenues decreased 1%, to $5.4 billion, from one year earlier, and the company's product sales slid 1% as well. On the positive side, Amgen's first-quarter earnings rose from $2.50 a share to $2.79 year over year.
That mark fell short, however. An analysis by FactSet Research Systems showed analysts expected earnings of $2.99 per share on revenues of $5.61 billion.
Amgen blamed the double-digit drop in Enbrel sales on increased competition in the sector as well as lower growth in both the rheumatology and dermatology sectors vs. prior quarters. The past growth of the drug, which is featured in TV ads featuring pro golfer Phil Mickelson, has been a revenue driver for Amgen. But ahead of the earnings announcement, the company tried to soften the ground in terms of expectations, warning that Embrel would likely be impacted by pricing pressure.
The company blamed fewer shipping days in the first quarter and higher costs to patients as a drag on sales and also said that it expected the drug's sales to turn upward as 2017 goes on.
At the other end of the range, Amgen's sale of osteoporosis drug Prolia jumped 21%, to $425 million, about $10 million higher than what analysts expected.
Despite the drop in first-quarter revenues, the company maintained its revenues guidance for 2017 at $22.3 billion to $23.1 billion.
The company pointed to its ability to capture and control costs as the Amgen operating expenses dropped 8%, to $2.87 billion, and both R&D and general and administrative expenses decreased 12%.
Amgen also said it was looking to grow via acquisitions but said the current environment made those prospects more challenging.
Another theme from the company was blaming payers for a less than robust reception for Amgen's new drug to lower cholesterol, Repatha, a medication for patients at risk for strokes and heart attacks. The company reported sales of $49 million, 36% short of analysts' consensus. Amgen pulled no punches as it blamed insurers and pharmacy benefit managers for failing to embrace the drug in the way that the company hoped. The company was also critical of the guidelines doctors face prescribing Repatha as too burdensome. Company officers said a number of times on the earnings call that Amgen is counting on white papers from outside researchers on best treatment practices for cholesterol as well as physicians complaining about the process the must follow to put Repatha in patients' hands.
The company's earnings report comes just three days after it announced an expanded partnership with Novartis tied to the prevention of migraines with erenumab. The original collaboration in 2015 between the pharmaceutical companies called for a united effort to team up on global neuroscience work tied to Alzheimer's disease and migraines.
The expanded collaboration calls for the two companies to work on co-commercialize of erenumab in the United States while Amgen retains the rights in Japan, and Novartis picks up the commercial rights in Canada and retains the commercialization rights around the rest of the world.
Erenumab is a human monoclonal antibody designed to target and block the Calcitonin gene-related peptide receptor, which is believed to be critical in mediating the incapacitating pain of migraine. Positive data from a trio of studies on migraine prevention were announced last year. This data will help support discussions with regulatory agencies with a filing anticipated in the second quarter of this year.