You remember that growth machine? The one that saw its shares quintuple over a couple of years in the late 1990s?
It's back.
Shares of Amgen (NASDAQ:AMGN) are up 40% from their lows in March -- and for good reason. As I pointed out when Johnson & Johnson (NYSE:JNJ) reported earnings last week, the slide of anemia drugs seems to be slowing, and Amgen's drugs aren't likely to see competition in the U.S. from Roche's Mircera.
Revenue was up just 7% year over year in the third quarter, but that's considerably better than everyone was expecting -- including Amgen, which raised revenue expectations for the year by 2%. And the bottom line -- excluding charges, but including stock options -- was up a very impressive 14%.
More importantly, Amgen's future looks good as well. After a couple of delays, Nplate, its treatment for immune thrombocytopenic purpura (ITP), a chronic blood platelet disorder, was approved. Additionally, GlaxoSmithKline's (NYSE:GSK) and Ligand Pharmaceuticals' (NASDAQ:LGND) potential competing drug, Promacta, seems to be stuck in FDA limbo, now that we're more than a month past its PDUFA date.
Farther along, but with a potentially much larger market, its osteoporosis treatment, denosumab, is performing well in clinical trials. The exact timing of filing the marketing application for denosumab remains unknown, but management says it should be in the "very very near future." So investors shouldn't have to wait too much longer to see how the drug will compete in the very competitive landscape that includes Novartis' (NYSE:NVS) Reclast, Eli Lilly's (NYSE:LLY) Evista and Forteo, and generic versions of Merck's (NYSE:MRK) Fosamax, just to name a few.
Amgen doesn't really look cheap by most measures right now, but growth stocks hardly ever do. If Amgen can continue the growth and get denosumab approved, it should be well on its way to another growth spurt -- and its stock is sure to follow.
