Pharmas Market with Mike Huckman

Amgen's Bone Drug Data: Is There "Bone Of Contention"?


After the closing bell yesterday, Amgen put out apress release announcing that phase 3 pivotal data are being published in a scientific/medical journal about its most important drug development pipeline product--an osteoporosis drug known as D-mab. (Whenever you see the letters mab at the end of the scientific name for a drug it means it's a monoclonal antibody).

The biotech company says the results are positive--that the twice-a-year shot strengthened bones across the board. First, the stock popped in volatile after-hours trading and then it went down. Minutes later, Bear Stearns analyst Mark Schoenebaum put out a rapid-fire research note to clients highlighting in boldface red type (black type here):

"This is ***NOT*** the primary trial that the Street is waiting for--that trial is in PMO-prevention, and is due to end in the Aug./Sept timeframe. As a reminder, Amgen has previously communicated most data from this trial--thus, we expect limited stock impact from the data."

FYI--PMO stands for postmenopausal osteoporosis.

Schoenebaum or someone who lives with him owns AMGN, Bear has banked Amgen and wants to do it again soon and it makes a market in the stock.

But this morning at least a few analysts are raising red flags. "Safety-wise, the infection rate was higher with Dmab (8 to 1)," writes FBR analyst Jim Reddoch. Wachovia's George Farmer calls it "a concerning trend of increased serious adverse events, including a statistically significant higher frequency of infections requiring hospitalization."

The infections were knocked out by antibiotics but Farmer says, "We caution, however, if not a regulatory risk, such data included in an eventual product label could limit the commercialization potential of dmab in a field of generally safe and effective generic and branded (osteoporosis drugs)." Wachovia and FBR make a market in AMGN.

A spokesperson for Amgen says the company expects to have all the data it needs by the end of this year to file for Food and Drug Administration approval of the drug.

And separately, while I was travelling back from the cardiology conference in Chicago the other day, Amgen posted its proxy statement on the web. Chairman and CEO Kevin Sharer took about a $4 million pay cut last year as the company saw revenue and profits fall from all the controversy over its anemia drugs.

He still received a total compensation package of nearly $20 million. Two other top-level AMGN execs also took it on the chin--relatively speaking, of course. R & D Chief Dr. Roger Perlmutter had his pay cut more than in half to $4.7 million and George Morrow, who runs commercial operations, pulled in $3.6 million in 2007 versus the $8.7 million he got in '06.

Sharer's perks included $25,000 for use of a company car and driver and nearly a quarter-million dollars worth of flight time on the company's aircraft. By way of contrast, Amgen's rival to the north, Genentech , is not in the aviation business. The company doesn't own any private jets. Whenever possible, I'm told its execs fly commercial, although for obvious security and business reasons never too many of them on the same flight.

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