WASHINGTON -
Amgen shares have dropped 27 percent the past year with two-thirds of the decline coming since early December, reflecting investor fears its best-selling anemia drugs could plunge again this year after 25 percent revenue drops in 2007.
Driving the declines: federal regulators coming down on the anemia treatments, which have been linked to increased risk of death and cancerous tumor growth surges.
Next Thursday, an outside panel of experts for the Food and Drug Administration will review data on three injectable anemia drugs: Epogen and Aranesp, made by Amgen, and Johnson & Johnson's Procrit.
The drugs treat the blood-disorder anemia patients with kidney failure or who are undergoing chemotherapy.
FDA outside panelists could recommend no action or an outright halt to the drugs' use in cancer patients or some action in between those two extremes. Most analysts say they expect regulators will take a middle road, perhaps limiting use of the drugs to certain forms of cancer.
FDA is not required to follow its panelists recommendations, though it often does. The agency twice slapped warnings on anemia drugs last year, after six studies showed patients had higher risk of death or accelerated tumor growth.
Since regulators added "black box" warnings, the most serious ones the FDA has, in November, new studies and analysis have further underscored the risks of these drugs.
Amgen released preliminary results late last year showing women with cervical and breast cancer died sooner and had faster tumor growth when taking its drugs. The current drug labeling does not mention those risks.
Diversified giant J&J has weathered the added regulatory scrutiny and action, but Amgen, which some Wall Street analysts presumed had bottomed last fall, continue to slide.
U.S. sales of Amgen's anemia drugs fell nearly 25 percent to $6.3 billion for 2007, according to figures from IMS Health Inc., a health care research firm. If the FDA's outside panel recommends middle-of-the-road limits next week and the FDA concurs, Amgen sales this year would fall another $150 million to $250 million to just over $6 billion, estimates Goldman Sachs' analyst May-Kin Ho. She adds that the stock could fall another $1 to $2 a share in the meantime.
Last month an analysis of 51 trials showed patients taking anemia drugs were 10 percent more likely to die and 57 percent more likely to have dangerous blood clots than those who weren't taking the drugs. Previous reports had found similar results.
Amgen scientists are expected to argue next week that those safety problems were caused by doctors using higher-than-recommended doses of the drugs. That issue is already addressed by FDA's labeling, they say, which warns doctors to use the lowest doses of the drugs possible.
Amgen will also argue that the risks of Aranesp and Epogen still do not outweigh the alternative - giving patients regular blood transfusions.
"There are various risks with blood transfusion and you have to wonder if we would be having this vigorous debate if there were an epidemic of blood-borne illness," said Amgen Vice President Dr. Roy Baynes.
However, many experts say blood transfusions are safer now than two decades ago, when concerns over HIV in the national blood supply persuaded many doctors to prescribe anemia drugs.
Given that all blood donations are now screened for HIV, Dr. Charles Bennett argued doctors can cut down on prescribing drugs like Aranesp.
"It's clear that these drugs were overused because we've seen sales drop so dramatically in the past year without seeing reports of people dying in the streets," said Bennett, a professor at Northwestern University, who authored the most recent analysis of anemia drug risks.
Bennett and other cancer experts said it's unlikely FDA would withdrawal Aranesp and its peers for use in all cancer patients - but analysts are not ruling that possibility out.
Under that scenario, Goldman's Ho estimates Amgen's 2008 sales would fall $750 million, reducing earnings 35 to 40 cents per share while shares could fall another $3 to $4 a share.
WASHINGTON -
Amgen shares have dropped 27 percent the past year with two-thirds of the decline coming since early December, reflecting investor fears its best-selling anemia drugs could plunge again this year after 25 percent revenue drops in 2007.
Driving the declines: federal regulators coming down on the anemia treatments, which have been linked to increased risk of death and cancerous tumor growth surges.
Next Thursday, an outside panel of experts for the Food and Drug Administration will review data on three injectable anemia drugs: Epogen and Aranesp, made by Amgen, and Johnson & Johnson's Procrit.
The drugs treat the blood-disorder anemia patients with kidney failure or who are undergoing chemotherapy.
FDA outside panelists could recommend no action or an outright halt to the drugs' use in cancer patients or some action in between those two extremes. Most analysts say they expect regulators will take a middle road, perhaps limiting use of the drugs to certain forms of cancer.
FDA is not required to follow its panelists recommendations, though it often does. The agency twice slapped warnings on anemia drugs last year, after six studies showed patients had higher risk of death or accelerated tumor growth.
Since regulators added "black box" warnings, the most serious ones the FDA has, in November, new studies and analysis have further underscored the risks of these drugs.
Amgen released preliminary results late last year showing women with cervical and breast cancer died sooner and had faster tumor growth when taking its drugs. The current drug labeling does not mention those risks.
Diversified giant J&J has weathered the added regulatory scrutiny and action, but Amgen, which some Wall Street analysts presumed had bottomed last fall, continue to slide.
U.S. sales of Amgen's anemia drugs fell nearly 25 percent to $6.3 billion for 2007, according to figures from IMS Health Inc., a health care research firm. If the FDA's outside panel recommends middle-of-the-road limits next week and the FDA concurs, Amgen sales this year would fall another $150 million to $250 million to just over $6 billion, estimates Goldman Sachs' analyst May-Kin Ho. She adds that the stock could fall another $1 to $2 a share in the meantime.
Last month an analysis of 51 trials showed patients taking anemia drugs were 10 percent more likely to die and 57 percent more likely to have dangerous blood clots than those who weren't taking the drugs. Previous reports had found similar results.
Amgen scientists are expected to argue next week that those safety problems were caused by doctors using higher-than-recommended doses of the drugs. That issue is already addressed by FDA's labeling, they say, which warns doctors to use the lowest doses of the drugs possible.
Amgen will also argue that the risks of Aranesp and Epogen still do not outweigh the alternative - giving patients regular blood transfusions.
"There are various risks with blood transfusion and you have to wonder if we would be having this vigorous debate if there were an epidemic of blood-borne illness," said Amgen Vice President Dr. Roy Baynes.
However, many experts say blood transfusions are safer now than two decades ago, when concerns over HIV in the national blood supply persuaded many doctors to prescribe anemia drugs.
Given that all blood donations are now screened for HIV, Dr. Charles Bennett argued doctors can cut down on prescribing drugs like Aranesp.
"It's clear that these drugs were overused because we've seen sales drop so dramatically in the past year without seeing reports of people dying in the streets," said Bennett, a professor at Northwestern University, who authored the most recent analysis of anemia drug risks.
Bennett and other cancer experts said it's unlikely FDA would withdrawal Aranesp and its peers for use in all cancer patients - but analysts are not ruling that possibility out.
Under that scenario, Goldman's Ho estimates Amgen's 2008 sales would fall $750 million, reducing earnings 35 to 40 cents per share while shares could fall another $3 to $4 a share.
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