- RBC Capital's Michael Yee maintains his Outperform rating on Amgen (AMGN -1.2%) with a price target of $190 (14% upside). His rationale is based on the potential for a delay in the U.S. launch of the Neulasta (pegfilgrastim) biosimilar from Toronto, Canada-based Apotex, still under FDA review.
- He feels that there is a chance that the product will not be approved (unlikely) or Amgen's litigation will tie matters up until at least mid-2016 (likely). Amgen sued Apotex accusing it of infringing on two patents ('138 and '784). The case is scheduled to be heard in July 2016.
- Amgen is also accusing Apotex of violating the Biosimilar Price Competition and Innovation Act (BPCIA) by failing to provide 180-day effective notice of commercial marketing. Apotex has not provided the notice because its offering has not been cleared yet (FDA filing was December 2014). Amgen successfully employed this delaying tactic in its suit against Novartis' (NVS -0.9%) Sandoz unit over its Neupogen (filgrastim) biosimilar Zarxio, approved by the FDA in March but unable to be launched until September.
- Mr. Yee believes that the legal maneuverings will give Amgen sufficient time to convert many Neulasta customers to its on-body formulation even if it does not prevail in its case against Apotex.