Amgen's Bone Density Drug Needs to Prove Itself

You can see by the market's reaction to recent trial results what it thinks of this marketplace and the potential for Amgen (AMGN). This is a very different market than cancer -- much tougher to crack, lower-margin drugs and less growth potential. I don't think the results will push the company forward too much.

Denosumab, if approved, will eventually go head-to-head with very-low-cost generic Fosamax, a market leader -- and Fosamax (from Merck (MRK)) is a pill, while Denosumab requires an injection.

The Amgen drug may only succeed with later-stage patients not responding well to Fosamax or comparable drugs, depending on how it compares in a head-to-head trial that will produce data in the first half of 2008.

A lot depends on that trial -- if Amgen's drug does not do demonstrably better in trial, why would a patient or their payer pay for an expensive injectible compared to an oral, low-cost generic?

Bottom line: stay away from Amgen until it hits 40 -- and when it hits 40, continue to stay away until it produces more and better news about its pipeline.

AMGN 1-yr chart:

Comments

[twinnkie:]

amgn will hit 90 by early 2009

2007 Dec 27 05:36 PM