Why Amgen Shares Are Trading Lower Today

Amgen Inc AMGN reported Q1 FY23 sales of $6.11 billion, down 2% Y/Y, resulting from lower revenue from COVID-19 manufacturing collaboration, partially offset by a 2% increase in product sales. The consensus estimate stood at $6.17 billion.

Product sales growth was driven by 14% volume growth, partially offset by 5% lower net selling price, 3% unfavorable changes to estimated sales deductions, 2% lower inventory levels, and 2% negative impact from foreign exchange. 

Excluding the 2% negative impact of foreign exchange on product sales, total revenues were largely unchanged from Q1 2022.

Related: Amgen Faces Lawsuit For Hiding Its Stupendous Tax Bill Of $10B.

Adjusted EPS decreased 6% to $3.98, beating the consensus of $3.85.

Pipeline Update: On the chopping block at Amgen is a study of rozibafusp alfa, formerly dubbed AMG 570, a Phase 2b study for systemic lupus erythematosus has been stopped “for futility.”

The other immunology program to be cut is a separate phase 2b study of efavaleukin alfa, formerly AMG 592. The interleukin-2 (IL-2) mutein Fc fusion protein was also being assessed in SLE in a Phase 2b study for futility. 

Amgen continues to evaluate the IL-2 drug in a mid-stage trial for ulcerative colitis.

Guidance: Amgen expects FY23 revenue of $26.2-$27.3 billion compared to the consensus of $26.7 billion, with adjusted EPS of $17.60-$18.70 versus the Wall Street estimate of $17.72.

Price Action: AMGN shares are down 2.23% at $234.99 premarket on the last check Friday.