Amgen, Inc. (AMGN) stock prices were down a marginal 0.15% as of market close on April 27th, 2021, inching the price down to USD$255.13. Subsequent pre-market fluctuations saw the stock price fall by 3.38%, bringing the price per share down to USD$246.50.
Total Revenues Suffer
The COVID-19 pandemic has been devastating for Amgen since its onset more than a year ago, with the ongoing and cumulative negative effects of the virus continuing to cripple patient visits and new patient diagnoses. This has resulted in total revenues for Q1 2021 experiencing a decline of 4% to hit USD$5.9 billion, as compared to the first quarter of the previous year. GAAP earnings per share for Q1 2021 were reported at USD$2.83, an 8% decrease as a result of the fall in revenues.
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Product Sales Decrease
Given the cyclical nature of historic patterns of Enbrel, Otezla, and Aimovig sales, the lower Q1 2020 sales numbers are to be expected. Benefit plan changes being implemented, insurance reverifications, and increased co-pay expenses are largely to account for the sales of the first quarter historically being lower than for the rest of the year. Total product sales fell by 5% in Q1 2021 compared to the same time period of the previous year. While net selling price suffered by 7%, unit volumes were up by 4%.
AMGN Liquidity Position
With USD$1.9 billion of free cash flow having been generated in Q1 2021, the company’s cash and investments totaled USD$10.6 billion at the end of the quarter. Outstanding debt as of the end of Q1 2021 was USD$32.7 billion. Q1 2020 also saw AMGN repurchase 3.7 million shares of its common stock, with the total transaction costing the company USD$865 million. As of the end of Q1 2021, AMGN reported USD$5.5 billion left as per its stock repurchase authorization.
Promising Developments in Product Portfolio
Having been granted Priority Review Status by the U.S. FDA, LUMAKRAS has seen the completion of its regulatory submissions across the EU, UK, Canada, Brazil, Japan, Switzerland, and Australia. Bemarituzumab has been granted Breakthrough Therapy Designation by the FDA, with plans to investigate the antibody’s effect on solid tumors such as squamous cell NSCLSC.
Future Outlook for AMGN
As the world races towards universal immunization against the COVID-19 virus in an effort to resume normal social and economic functioning, AMGN is gearing up after a very troubling past several quarters. As the ravaging effects of the pandemic and related government mandates and restrictions ease up, the company is leveraging its resources to capitalize on an era of post-pandemic growth.
