Tuesday, Cantor Fitzgerald maintained its Overweight rating and $405.00 price target on Amgen (NASDAQ:AMGN), following the discovery of new data related to the company's drug candidate, MariTide (AMG-133). The uncovered information reveals bone mineral density (BMD) data from the Phase 1 study of MariTide, which was previously an unknown factor and considered a risk due to the drug's mechanism of GIPR antagonism.
The additional data also includes information on AMG 598, a predecessor molecule that Amgen may have been researching to potentially challenge the hypothesis that GIPR antagonism leads to BMD loss. This was found by accessing hidden tabs in one of the extended data excel files titled "Source Data Extended Data Fig. 4."
The data suggests a 4% loss in BMD for participants receiving a 420mg dose of MariTide during the 12-week multiple ascending dose (MAD) study. The firm notes that while patients could naturally experience BMD loss during weight loss treatments if their diet is not optimized, the observed dose-dependent increase in BMD loss could be concerning.
The Phase 1 findings have prompted discussions on the potential implications for MariTide's development. The firm recognizes that BMD loss could be a natural side effect of weight loss treatments, but also acknowledges the possibility that a dose-dependent increase in BMD loss might impede the drug's progress.
In summary, Cantor Fitzgerald has reaffirmed its positive stance on Amgen, with the newly discovered data from the MariTide study contributing to the ongoing evaluation of the drug's safety and efficacy profile. The firm's price target for Amgen remains unchanged at $405.00.
In other recent news, Amgen reported a significant Q3 growth, with revenues rising 23% to $8.5 billion. This growth is credited to double-digit sales growth in ten products, especially in the oncology and rare disease sectors. The company's rare disease portfolio alone generated $1.2 billion, with TEPEZZA leading the pack at $488 million. Amgen also revealed substantial progress in its clinical pipeline, focusing on innovative treatments for obesity, type 2 diabetes, and various cancers.
In terms of future expectations, Amgen anticipates total revenues for 2024 to range between $33.0 billion and $33.8 billion. The company also increased its capital expenditure guidance to approximately $1.3 billion. Notably, Amgen is planning for increased investments in research and development and manufacturing, especially for its promising treatment for obesity and type 2 diabetes, MariTide, which is set for a broad Phase III program.
Despite preparing for increased competition in the osteoporosis market, the company expressed strong confidence in long-term growth across diversified portfolios. This optimism is backed by significant upcoming launches in biosimilars and ongoing clinical developments, including the approval of TEPEZZA in Japan and the expected launch by early 2025.
InvestingPro Insights
Amgen's financial health and market position offer additional context to the recent developments in its drug pipeline. According to InvestingPro data, Amgen boasts a substantial market capitalization of $158.48 billion, underscoring its significant presence in the biotechnology sector. The company's revenue growth of 21.25% over the last twelve months demonstrates its ability to expand its market share and potentially fund ongoing research and development efforts, such as the MariTide study.
InvestingPro Tips highlight Amgen's strong dividend history, having raised its dividend for 14 consecutive years. This consistent dividend growth, coupled with a current dividend yield of 2.8%, may appeal to investors looking for stable income alongside potential capital appreciation from drug development successes.
However, it's worth noting that Amgen is trading at a high P/E ratio of 38.63, which could suggest that the market has already priced in expectations for future growth, possibly including the potential success of drugs like MariTide. Investors should consider this valuation in light of the newly discovered data and its potential impact on the drug's development path.
For those seeking a more comprehensive analysis, InvestingPro offers 8 additional tips that could provide further insights into Amgen's investment potential.
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