Amgen Shares Hit 52-Week Low After Layoff Announcement
Amgen shares plunged to a 52-week low Thursday in the wake of the biotechnology firm’s announcement that it will lay off more than 2,000 and as many as 2,600 employees--or 12 to 14 percent of its labor force.
Amgen shares lost about 3 percent on the Nasdaq.
The layoffs, announced after market close Wednesday, come in reaction to weak sales for two of Amgen's anemia drugs, Aranesp and Epogen.
It will mark the first time Amgen has enacted layoffs.
Last year, Aranesp was Amgen’s top-selling drug, with sales of more than $4 billion. But this year, the formulation, designed for cancer patients suffering from chemotherapy-induced anemia, saw lower sales amid new safety warnings.
And on Aug. 1, Medicare imposed new rules that restrict reimbursement for the entire class of drugs encompassing both Aranesp and Epogen.
The company also said it will cut capital spending by some $1.9 billion over the next two years and shutter some of its plants. The moves are designed to save the firm $1 billion to $1.3 billion annually.