Amgen is Acquiring… But Who? (AMGN)

June 18, 2010 · Filed Under Anemia, M&A, osteoporosis 

Amgen Inc. (NASDAQ: AMGN) is on the acquisition path.  Yesterday at a Goldman Sachs conference, CEO Kevin Sharer said that Amgen is aggressively looking for acquisition targets on an international diversification basis.  These acquisitions are not meant to be game changers and will not be any mega-deal as Sharer said that he won’t be betting the company’s future on any single deal.

The company was also noted as seeking to invest its growing offshore cash position on an intelligent basis and not in any companies that needed to be fixed or turned around with current problems.

As far as too much diversification, that might not be expected either.  Sharer shared that the clinical diagnostics acquisition belief does not really fit with the core operations of the company because it was noted that very few drugs have been directly linked to biomarkers that accurately patient suitability for drug responses.

At face value, Sharer also said that Amgen has a robust mid-stage drug pipeline.  As far as the woes of anemia drugs, Sharer of when or at what level the anemia drug sales of Aranesp and Epogen would come due to Medicare reimbursement changes, pricing pressures, and ultimately the patent expirations. It was just this week that new news came out that Medicare is revisiting anemia drug coverage, and throughout the election and start of the new administration President Obama had noted “generic biologicals” which target this anemia market.

An acquisition could of course be in teh cards here in the U.S. if the drugs have a large international presence and/or a large international opportunity.  The difference is that it seems that Amgen may be looking for new growth opportunities in new markets or in related markets rather than just more of the same.

The United Kingdom’s healthcare cost-effectiveness monitor has also just now recommended that Amgen’s newly-launched drug called Prolia for treating osteoporosis in post-menopausal women who are at increased risk for bone fractures.

We have been waiting for Amgen to make a diversification away into new or tangent markets.  Amgen is likely going to be acquiring.  The question is WHO? Or whom?  Stay tuned.

JON C. OGG

Comments

One Response to “Amgen is Acquiring… But Who? (AMGN)”

  1. william shelley on June 21st, 2010 10:18 am

    When Amgen has no growth, at 82 years old and a holder for 20 years, it would be nice if Kevin would pop for a dividend. When is hits 64, I am gone and I will no longer complain about Kevin vacationing in the company plane.

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