Amgen Inc. (AMGN) Earnings Call Transcript & Summary

Day 1 of the BofA Healthcare Conference. So my name is Geoff Meacham, I'm the senior biopharma analyst. We're thrilled today with us to have Amgen, and on stage, Peter Griffith, CFO. Peter, good to see you.

Great to be here, Geoff. Thank you so much for inviting us.

Of course. We have Jay Bradner from the R&D team, and we have Justin from the IR team. So guys, thanks for joining. I know there's going to be a lot of questions on obesity. But maybe just to do a post 1Q, your sort of high-level takeaways and kind of how you think about the view looking forward?

Geoff, thank you. Thank all of you for your interest in Amgen. We're delighted you're here today. Let me give you a few comments and then we'll jump right into Q&A. Exciting time at Amgen, as you know, and I think that's why we're here. we're reaching many, many more patients around the world with our existing medicines, advancing a broad range of potential first-in-class and/or best-in-class medicines in our mid- and late-stage pipeline, redefining what's possible in research as we harness transformative technologies. Obviously, obesity is front and center. These days, hopefully, you heard our confidence and the opportunity for MariTide on the earnings call. At a high level, we announced that the MariTide interim analysis for the Phase II study is complete and that we are confident in MariTide's differentiated profile, and we're actively planning a broad Phase III program, including obesity, obesity-related conditions and diabetes. We've also initiated activities to further expand manufacturing capacity with both clinical and commercial supply in mind. We had a chance to meet with investors following the earnings call. We were asked an important question, how do we view the business beyond obesity? In short, we've got great confidence we're on a path to deliver attractive, long-term growth through the end of the decade and beyond, not just because of obesity but rather from the breadth and the depth of our 4 therapeutic areas, general medicine, oncology, inflammation and rare disease, each of which have strong momentum and plenty of room to grow. In terms of marketed products, let's recap. Repatha in the first quarter up 33%, 44% volume growth; EVENITY was up 35%, the bone franchise; BLINCYTO, acute lymphoblastic leukemia, very important medicine, up 26%; TEZSPIRE, treating severe asthma, up 80%. With BLINCYTO, we expect an approval in June, June 21 PDUFA date that should accelerate our efforts to integrate into earlier lines for acute lymphoblastic leukemia. With TEZSPIRE, we'll share encouraging data later this month that reflect the attractive potential of the medicine in chronic obstructive pulmonary disease where new treatments are very much needed. Rare disease contributed nearly $1 billion of sales in the quarter, up 14% year-over-year. Of those sales from a year ago, we didn't own Horizon the year before that, but we wanted to give you apples-to-apples on that, including TAVNEOS. Those are all significant upside in those products, first-in-class, early life cycle products, TEPEZZA, KRYSTEXXA, UPLIZNA and TAVNEOS. We're pushing -- pursuing launches in new geographic markets, new indications and new formulations for each. So beyond the strong foundation provided by the marketed products, we wanted to remind you about our rapidly advancing number of promising new medicines in our mid- and late-stage pipeline. All 4 of our therapeutic areas. We're eagerly awaiting approval of tarlatamab, which is the first T-cell engaging therapy to demonstrate significant clinical activity against the common solid tumor. Behind that in Phase I, we have xaluritamig for prostate cancer, we're excited in xaluritamig too for -- as a T-cell engaging therapy. We anticipate data readouts from 5 Phase III trials later this year and recently announced the development of a biosimilar to KEYTRUDA, ABP 234 as we look to build upon the global leadership we've established in biosimilars. And beyond these programs, we have a number of very exciting potentially first-in-class and/or best-in-class programs in Lp(a) with olpasiran -- and that's a cardiovascular outcome trial; rocatinlimab, Phase III, for atopic dermatitis. That first Phase III read-out expected later this year and a number of oncology programs, including AMG 193. And I mentioned xaluritamig, bemarituzumab in gastric cancer. These programs alone have great potential to contribute meaningfully to the long-term growth. So just one thought to leave you with here as we jump into Q&A. Geoff certainly knows that. Just recognize to protect the integrity of the study of MariTide, we're limited in what we can say about it before completion of the ongoing study. So we feel great about a broad range of medicines at Amgen. We're looking forward to continue to drive innovation at speed and scale through the decade and beyond. So Geoff, that's not just the first quarter. That's more, and we're excited about what's going on. I would just say too at Amgen. I always like to start as we go into this. The mission at Amgen, people come to work each day because of the mission at Amgen. We discover, we develop, we manufacture and we deliver first-in-class and best-in-class innovative medicines to patients with serious and grievous illnesses and all over the globe. So we're excited about that every day, and that's why we're here, Geoff?

Awesome. Thank you, Peter. Great background. Jay, so let's get into just a few questions on MariTide. I'm sure you've gotten a few post the quarter. So I guess one of the main questions that we're getting is just differentiation, so once monthly or longer could be one element of that. I know you're still working on optimizing the profile in Phase III. But give us maybe Amgen's view of how you would sort of stack up the kind of the profile of MariTide relative to standards of care today from a competitor or from a differentiation standpoint.

Well, thanks for the question. And really honestly, we're thrilled by the interest in this medicine, which we think is very special, very unique medicine. I'm sure that many in the room are familiar with AMG 133 or MariTide. I'll give just a little background on what the medicine is in part to address your question, but to bring everybody along in the discussion. So companies like ours, and honestly, like Novo and Eli Lilly have been studying metabolism and obesity with real surgical focus for more than a decade. And we didn't show up to this party because it got hot and interesting, we've had scientists at Amgen probing on mechanisms of obesity for 20 years. And secondly, we probably are the industry's leading harvester of insights from human genetic variation, if you know, our work at deCODE Genetics in Iceland. And so putting these 2 pieces together, interest in metabolism and a fundamental capability in human genome science, we learned years ago that polymorphisms or variation in the GIP receptor or its pathway that would lead to its down regulation were protective against obesity and cardiovascular outcomes. And so scientists like Murielle Veniant-Ellison and others in our organization built a monoclonal antibody that would inhibit the GIP receptor, recognizing that GLP-1 agonism can also confer favorable physiology on obesity and related conditions, we have appended 2 GLP-1 peptides to this antibody. But one would be wrong to think of this as a pharmacokinetic play only because it turns out that the exact spatial location of those appended peptides in the middle of the antibody versus the terminus or up in the variable chains has a quite substantial effect on the preclinical measurements of weight loss. And so with this sort of precision instrument, antibody peptide conjugate, 2:1 DAR, we built a strong preclinical data set that's now widely considered and reported, a Phase I data set that was strongly encouraging, a Phase II human clinical investigation and are now amidst, as Peter shared, a 592-patient, 11-arm characterization of this molecule antecedent to Phase III definitive clinical investigation. As we recently reported, we've conducted an interim analysis quite recently and had a chance as a very small group to see the complete unblinded arm assigned data set and emerge from that analysis very confident in the medicine as well as its differentiated profile. One could infer from some of the characteristics I've shared and the many measurements you make in Phase II clinical investigation really many things around differentiation. And as Peter shared, we're not at liberty right now to dimensionalize that for you. But the profile that we see, even with outstanding medicines in the market is differentiated, and it's given us the confidence to enter into final Phase III planning as well as to announce and open a Phase II clinical trial dedicated for the study of diabetes.

Got you. That's helpful. And just along those lines, and again, appreciating that you may -- you're going to talk about this data in a more public format when you publish the data or presented at a conference. But maybe give us some perspective on what you saw on the tolerability piece of it in the ongoing Phase II that would give you the confidence to go into a Phase III to invest heavily in the development beyond that, knowing that, of course, the Phase I was, what, 50 patients or something in that range? And maybe help us with bridging the Phase II optimism with what kind of you learned and fit in Phase I.

I mean for all medicines, but especially those treating diseases as broad as we hope MariTide can, it will be a broad Phase III program that we will hopefully open. Tolerability is very important. What I can share at this time is that of this 11-arm study that seeks to explore chronic weight management in different doses and schedules, monthly and even less frequent dosing as well as with different paths to peak dose and all arms of this study remain open right now.

Okay. And from the device itself, just help us with bridge, the injectable device and kind of how you see the ultimate Phase III and commercial profile happening in the real world with the device, with what you have today and in Phase I?

With early clinical investigation, we take the fastest path to initiating these studies with a reliable administration of -- subcutaneous administration of MariTide. But we expect, once this medicine is brought to patients worldwide that it will be a simple, handheld auto-injector with an outstanding patient experience.

Okay. Makes sense. And looking to beyond 133 or MariTide in the obesity pipeline, when you think about 786 or maybe other mechanisms of action in metabolic from your deCODE days or from the deCODE data, are there more novel targets to be explored in this space?

There are, Geoff. Thanks. We have a handful of programs behind MariTide. This isn't a one-and-done adventure for us. This longitudinal commitment to the biology and pharmacology of obesity and its related conditions has proffered a number of mechanistically novel approaches to chronic weight management and associated diseases. You mentioned the 786 molecule, which we just announced, we're retiring from the portfolio. And we did not take this decision lightly. In the fullness of time, we'll be able to describe to the community the mechanism of action, the remarkable molecule that we made and all that we learned from it. But the bar is just higher right now. At Amgen, 4 medicines that one might invest, so strongly behind for obesity. And it's a competitive landscape, which is great for patients, but it also really draws us to focus our attention on those medicines that we have the confidence in carrying the distance. And the totality of the data set around 786 did not meet the bar that we have for medicines that we would advance into Phase II clinical investigation for obesity.

Jeff, I would add to that. In terms of allocating capital to obesity, we view it as a platform and we've said that all along. We're very, very committed to it. We think Amgen is going to be an important participant in this global health crisis, and we're all in. We think this moment is made for Amgen. And I think one way to think about these different activities we have is heterogeneity of how we view obesity, right, Jay? And how we think about that. And we're just going to be committed to exploring what needs to be explored on behalf of patients.

That's right. I mean this is a massive number of patients that need these medicines. And surely this at the individual level, at various population levels, they'll have different needs, different expectations, different desires, weekly injectable therapy is not for everybody. And so recognizing that our pipeline seeks to develop incretin-based medicines like MariTide as well as non-incretin, mechanistically distinct medicines, injectable, in this case, monthly or less frequent medicines like MariTide and also oral medicines. And the call to arms out in the biotech industry has created so much attention to this as well. We don't view this as only an internal innovation story, and we watch innovation broadly in this sector.

And along these lines and maybe for both of you guys, when you think about the investments to make in manufacturing capacity, obviously, a super hot topic today with Lilly and Novo. You can likely get to Phase III pretty easily with Amgen's current capabilities. But how are you thinking about 3, 5 years from now, if MariTide -- if the data shape up, like you think it's going to shape up in a Phase III, what's the kind of level of investment you'll have to make in manufacturing. Maybe help us also with the difficulty of manufacturing just given the science behind the drug.

Well, let me jump in on that one, Jeff. That's an area that we're spending, as you can imagine, an enormous amount of time. And maybe it's an area that it's not disadvantageous to be later in the market, not the first 2. Amgen, really, since 2007, and we think all the way back is always had an opportunity to supply medicine for patients without any shortages. But we recognize in this case, this is a really important and large public health crisis. So we're prepared to invest behind it. I've indicated that we're making the capital expenditures we need to make this year to advance that broad Phase III opportunity, opportunities that we see for MariTide itself. And from a capacity perspective, our investors should, rest assured, that we're exploring all the alternatives we need. I would just remind all of you that we opened Amgen Ohio in the first quarter. It's a fill-and-finish drug product plant, very automated. We think state-of-the-art. And I went through there and I was just glad to avoid all those automated vehicles with no one driving them because I was going through there. But it's a great plant. So we're proud of that in the Columbus area. We've also shared with you that we have a new drug substance plant that's opening in Holly Springs, North Carolina, right next to the research triangle in the first half of 2026. That's on time. And so we're looking forward to having that in our network. And we always are thinking about network optimization around the world. And so we're committed to spend the capital both on a CapEx standpoint and an OpEx standpoint to make sure that we're fully prepared to meet patient demand on this as best we possibly can. And that's -- we show up every day for patients, and we realize this is a critical part of the equation here. So that's where we sit on it. We're going to keep pushing very, very hard on capacity and make sure we don't leave any stone unturned.

Can I pipe in because you invited around chemical synthesis if you could bring pipe word out.

I thought you're going to give them the peptide on the antibody.

Peter, you have this lovely way of saying that Amgen was made for this moment. I'm new to the company just these last 5 months. And now I've been to most of the sites and the large manufacturing facilities, and it's just true what you say. It's not every company that's built for biotherapeutic manufacturing. It's not every company that's built for biotherapeutic manufacturing at a population scale. How many patients have received Prolia now?