Amgen Plans New U.S. Plant After Tax Changes
By Austen Hufford
Amgen Inc. said Thursday it will spend up to $300 million to build a new U.S. manufacturing plant as it detailed the impact of the recent tax law changes.
The company also said it has added $10 billion under an existing share buyback program. It had $4.4 billion remaining under a current buyback program at the end of 2017.
Shares fell 3.5% in post-market trading as the company swung to a loss in its latest quarter on a $6.1 billion tax-related charge and missed expectations for revenue and profit. Despite growth from new drugs, lower sales from legacy products dragged overall revenue lower.
In the fourth quarter, Amgen reported a loss of $4.26 billion, or a loss of $5.89 a share, compared with a profit of $1.94 billion, or $2.59 a share, a year earlier. On an adjusted basis, the company reported earnings per share of $2.89, below the $3.03 analysts polled by Thomson Reuters had expected.
Revenue fell 2.7% to $5.8 billion, below the $5.83 billion expected by Wall Street.
The new U.S. plant, which will make products for both domestic and foreign markets, is part of $3.5 billion in capital expenditures planned over the next five years. Amgen said it expects about 75% of planned capital spending to be in the U.S., up from about 50% in recent years.
Some major drugs such as rheumatoid arthritis and psoriasis drug Enbrel and anemia-treatment Aranesp saw revenue declines on lower demand. In 2016, the U.S. Food and Drug Administration approved a lower-priced replica of Enbrel, though it has been held up by Amgen legal challenges.
Repatha sales grew 69% to $98 million, below the $106.1 million expected by analysts polled by FactSet. The drug, a class of PCSK9 inhibitors that lowers cholesterol, has struggled to gain approvals from insurance companies because of its price tag. The drug lists for more than $14,000 a year.
Sales of osteoporosis treatment Prolia rose 24% to $574 million, above the $531.1 million expected by analysts.
For 2018, the company expects revenue of $21.8 billion to $22.8 billion and adjusted earnings per share of $12.60 to $13.70. Analysts had expected revenue of $22.8 billion and earnings per share of $12.71.
Write to Austen Hufford at firstname.lastname@example.org
(END) Dow Jones Newswires
February 01, 2018 17:25 ET (22:25 GMT)Copyright (c) 2018 Dow Jones & Company, Inc.