Amgen Plans New U.S. Plant After Tax Changes

02/01/18 05:25 PM EST
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 austen.hufford@wsj.com

 

(END) Dow Jones Newswires

February 01, 2018 17:25 ET (22:25 GMT)

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