Amgen Invests In Deals, Share Buybacks And Manufacturing As Sales Dip
Amgen reported reduced revenue for 2017 and its 2018 guidance anticipates either flat sales or further decline, so the company is under increasing pressure to spend its $41.7bn in cash in ways that boost earnings, but $14.4bn already is committed to buying stock back from shareholders.
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Amgen started 2018 off on solid footing with a 2% jump in Q1 revenue to $5.55bn versus consensus estimates of $5.4bn, but new drugs like the CGRP inhibitor Aimovig are needed to keep the momentum going and supplement declining sales for key products.
Investors await news from Lilly on whether it will use repatriated cash for M&A; from Biogen on its Spinraza and gene therapy strategies in light of Novartis' AveXis deal; and from Amgen on pipeline programs and acquisitions as major products face new competition. Immuno-oncology combination updates are anticipated from Roche, plus guidance on how GSK will cope with Advair generics, HIV competition from Gilead and the cost of new drug launches is expected.
As pharma invests its bounty from last year's tax reform in stock buybacks, capital improvements and other investments, Sen. Cory Booker issues a report suggesting companies should lower drug prices instead, but does not offer recommendations for how that might be done.