Q3 2022 Amgen Inc Earnings Call
My name is <unk> and I'll be your conference facilitator today for Amgen's third quarter 2022 financial results conference call all lines and placed on mute to prevent any background noise there'll be a question and answer session. At the conclusion of the last few years prepared remarks to ensure that everyone has a chance to participate.
We'd like to request that you limit yourself to asking one question during the Q&A session.
To ask a question. Please press Star then the number one on your telephone keypad to withdraw your question. Please press star two.
I would now like to introduce Arvind Sood, Vice President of Investor Relations. Mr. Sood, you may now begin.
Okay. Thank you, Jason and good afternoon, everybody and welcome to our Q3 call.
So we continued with our execution during the quarter with a focus on driving volume growth for our key products and advancing our innovative pipeline.
Leading the discussion today will be our chairman and CEO , Bob Bradway, we have posted some slides for your reference and my customary reminder, that we will be making some forward looking statements and use of non-GAAP financial measures to describe our performance so with that I would like to turn the call over to Bob.
Okay. Thank you all of you for joining our call.
In the face of both macroeconomic and industry specific challenges Amgen remains laser focused on delivering for patients and shareholders.
Benefit of that focus was evident in the third quarter with volumes up a healthy, 8% and 16% outside the United States.
These results reflect the strong underlying demand for our medicines and the value they bring to patients even in challenging economic times like those prevailing at the moment.
Revenues for the quarter were down 1%, reflecting a 5% net price decline.
System with what we communicated earlier in the year and a 2% impact from foreign exchange.
All told 11 of our products generated record sales in the quarter and non-GAAP earnings per share increased 15% with free cash flow is reaching $2 8 billion for the quarter.
Looking forward, we remain focused on several growth drivers.
With the recent closing of the Chemo Centrex acquisition, we're excited to have <unk> in our portfolio <unk> is the first new treatment for <unk> associated vasculitis in more than 10 years, and we're confident that we can leverage our decades of experience in inflammation and nephrology to bring this innovative medicine to many more patients moving forward.
Forward.
Two recently launched products to inspire and <unk> are off to solid starts to.
Aspire is performing well and asthma and we have studies underway for several other indications for that product as well.
<unk> is performing well globally with patients payers and prescribers recognizing the importance of this innovation.
We have combination studies underway, we're exploring the many different ways. This product may benefit patients through time.
We have a number of key products led by <unk>, Cosla Prolia and <unk> entity that we know can benefit millions more patients globally than they do today.
And let's not lose sight of the fact that these four products collectively generated $2 billion in third quarter sales with volume growth of 17%.
We've built an industry, leading biosimilars business, having now launched five products in markets around the world.
And we are months away from being the first company to launch a biosimilar to humira in the U S.
<unk> is already the most prescribed humira biosimilar in Europe , giving us confidence as we prepare to enter the U S market.
Looking forward, our next wave of Biosimilars to stay Lora Soliris in Eylea.
Our well positioned with our having now successfully completed phase III trials for all three of these molecules.
We have many potential new medicines advancing through our innovative pipeline, including El Paso ramp Carlotta Mab broker Tinder, Mab, <unk> Mab and AMG 133.
These five molecules and several others that.
That youll hear about shortly from Dave Reese, our vintage Amgen, which is first in class medicines that make a big difference for patients suffering from serious diseases for which there remains a real need for new and better treatments.
And best in class approved treatment for patients with anchor associated vasculitis.
Let's walk through our third quarter financial results before discussing our 2022 guidance.
The financial results are shown on slide six of the slide deck.
And Q3, we recognize total revenue of $6.7 billion.
This represents a modest decline of 1% year over year.
Excluding the impact of foreign currency total revenue in product sales grew too and 1% respectively.
Earnings per share of $4 70, screw, 15% versus a recast Q3 2021 recall those results included $400 million recorded and R&D expense related to our upfront payment to license rights to AMG 451 rocket 10 lament from Cuba, Karen Corporation K Casey.
non-GAAP EPS grew 1%, excluding the 400 million expense for the K K C license.
Murder, We'll review product sales with you, but I would highlight that are established product portfolio generated almost $900 million and product sales and continues to deliver strong cash flow to fund both internal and external innovation.
Other revenues of $450 million increased 8% year over year.
non-GAAP operating expenses decreased 8% year over year, primarily driven by the 400 million payment to K K C. In Q3 2021.
Excluding the impact of the $400 million upfront payment third quarter total non-GAAP operating expenses increased 4% year over year, reflecting investments to advance our research capabilities and pipeline, while also supporting product launches and we delivered a 52.5% operating margin as a percentage of product say.
<unk>.
On a non-GAAP basis cost of sales as a percent of product sales increased 0.3 percentage points on a year over year basis to $16, 1%, primarily due to changes in product mix, partially offset by lower manufacturing costs and lower costs associated with fewer COVID-19 antibody shipments.
Excluding the $400 million upfront payment non-GAAP R&D spend in the third quarter increased 10% year over year, primarily due to higher late stage program support and research and early pipeline spent.
Partially offset by lower marketed product support.
non-GAAP SG&A expenses increased 1% year over year, we continue to focus on prioritizing key investments and activities, while driving productivity automation and digitalization.
non-GAAP Oh irony was about $370 million in expense in the third quarter. This was driven by increased net interest expense and our share of Beijing result, because we're used to the equity method of accounting.
R R.
<unk> with lower than anticipated due to gains from liability management that we do not expect to the same extent and future court.
Bruce.
We have a strong balance sheet generate significant cash flow and retain significant financial flexibility to execute strategic business development opportunities and execute on our multiple capital allocation priorities.
And the third quarter, we executed on the following.
First our recent acquisition that came with Sentrix is a clear example of investing in the best innovation in this case external for patients.
Second investing in our business through capital expenditures, including advancing construction on our new environmentally friendly facilities in Ohio, and North Carolina.
Third returning capital to shareholders through growing dividends, including one dollar and 94 cents per share in the quarter, representing a 10% increase from Q3 2021.
And fourth opportunistic share repurchases the final settlement of the accelerated share repurchase.
ASR program.
Occurred in the third quarter, and we have repurchased about $6 $3 billion of shares your Z.
Turning to the outlook for the business for 2022.
We're pleased with our execution through the third quarter for the full year, we now expect to absorb about $560 million and FX headwinds against product sales based on recent FX rates.
Of which we absorbed nearly $400 million through the third quarter.
And this is net of our hedging activities.
Reflecting are strong execution through the third quarter and despite challenging foreign exchange dynamics were updating our 2022 revenue guidance range to $26.0 billion to $26.3 billion.
We are updating our non-GAAP EPS range to $17.25 to $17.85. This range encompasses both FX headwinds of approximately 3% or 45 cents for the full year based on recent FX race and cost associated with our acquisition of chemo.
Sentrix incurred between closing and you're in.
I'll share a few additional points to consider for the remainder of 2022 with a particular focus on how these trends are likely to impact Q4.
We expect FX headwinds to reduce product sales in Q4 by about $165 million.
The U S government has agreed to purchase $290 million or and play we will recognize about $200 million of those sales in queue for with the remainder of 2023.
We have completed the previously discussed divestiture of Gen Center are generics business in Turkey, and will no longer recognized product sales and operating expenses from that business effective November 2nd 2022.
Sales of that business annualize at approximately $90 million.
We now expect full year of the revenue for 2022.
Between $1.5 billion to $1.6 billion.
Versus our prior guidance of one four to 1.6 billion.
When comparing against our recast 2021 results. We continue to expect full year non-GAAP operating expenses to reflect a low double digit decrease year over year.
We continue to expect 2022, non-GAAP operating margin as a percentage of product sales to be roughly 50%.
We continue to expect non-GAAP cost of sales in the range of 15.5% to 16.5%.
As a percentage of product sales.
We now expect non-GAAP R&D expenses in 2022 to decreased 5% to 8% year over year compared to our recast 2021, non-GAAP Rd expensive, which include the $400 million upfront payment we discussed above.
We expect non-GAAP SG&A spend to be roughly flat year over year as a percentage of product sales.
We expect <unk> to be in the range of 1.6 to 1.7 billion with fourth quarter results closer to the first and second quarter results.
For the full year, we know anticipate a non gas tax rate range of 13.5% to 14.5%.
Down from our prior guidance of 14.0% to 15.0%.
As you consider your modeling for 2023 <unk>.
Recall, the tax law changes and acted by Puerto Rico in June of 2022.
Replace the Puerto Rico excise tax the prep in favor of an income tax will increase our 2023 income tax expense.
While reducing by roughly an equivalent amount or cost of goods sold.
However, there will be a one time residual negative impact in 2023 related to the amount of the press currently capitalized inventory that will be charged the cost of goods sold without a corresponding tax benefit.
This charge is slightly larger than the benefit previously recognized with the implementation of the press and 2011, which was discussed in our 2011 Form 10-K.
Summing up since the business review in February much has changed at the macro level with the strengthening of the U S. Dollar persistently high inflation higher interest rates and the passing of the inflation reduction Act.
Despite these headwinds we have executed well in 2022 as we plan for 2023, we anticipate that these headwinds will continue we're adapting our operating plans and expect to successfully execute against them like.
Like previous years, we expect to provide 2000 twenty-three guidance on our queue for earnings call in January or.
Confidence in long term growth of Amgen remains strong I think our millions of patients for their courage and my 25000 colleagues for their mission driven work on behalf of those patients every day.
This concludes the financial update I'll turn it over to Murdock.
Thanks Pizza, we saw strong volume growth in the third quarter with an 8% increase year on year.
We delivered record quarterly sales for 11 products, including a entity to spire, I'm jovito, Vectibix, kyprolis and play and billing cycle.
And double digit volume growth for several additional products, including <unk> and <unk> <unk>.
Excluding the impact of foreign exchange third quarter global product sales grew 1% as our volume increases were offset by a 5% decline in net selling price consistent with our prior estimates <unk>.
Including the 2% negative foreign exchange impact product sales declined 1% over here.
I'll start now with our general Medicine business, which includes Prolia, if entity Rip Harper and <unk> overall revenue for this portfolio grew 14% year over year, driven by 20% volume growth and.
Bone health Prolia sales grew 7% year over year, driven by 8% volume growth.
If entity, which complements probably on our bond portfolio had record sales of 201 million for the quarter driven by 45% volume growth in the U S and 32% volume growth outside of the U S.
<unk> sales increased 14% year over year, driven by 52% volume growth, which was partially offset by lower net selling price.
In the U S. We generated 32% volume growth aided by broad adoption of or pass up by cardiologist and increasing adoption by primary care providers. We also saw a declining net selling prices in the U S. As we offered higher rebates to support broad Medicare part D and commercial patient access look.
Going ahead to 2023, we expect less year over year use price erosion than we saw in 2022.
Outside the U S sales of Repass grew 26% driven by 73% volume growth net.
Net price declines outside the U S were primarily a result of repetitive inclusion on China's national reimbursement drug list as of January 1st 2000 2002.
Overall, we remain focused on addressing leading cause of morbidity and mortality by bringing were positive patients in need all around the world.
Moving to our inflammation portfolio Otezla sales increased 3% year over year for the quarter.
Tesla saw at 9% volume growth, partially offset by lower inventory and unfavorable foreign exchange impact.
In the U S. So Tesla remains the leader in bio naive psoriasis patient share and we see broader adoption of otezla among patients with mild to moderate psoriasis.
Looking forward, we expect continued strong volume growth given hotez was established safety profile strong pair of coverage and unique position as the only systemic oral the country.
Rod spectrum of patients with psoriasis, regardless of the severity of their disease.
<unk> sales decreased 14% year over year for the third quarter, driven by lower net selling price unfavorable changes to estimated sales adoptions and a 3% decline in volume.
And Bro remains an important product for patients due to its long track record of efficacy and safety.
I'm very pleased with our strong U S launch to spier, which generates at $55 million of sales in the third quarter.
Just some pulmonologists have prescribed touched by her across a broad range of patients with severe uncontrolled asthma.
We're also seeing initiation in both biologic naive and previously treated patients.
Physicians acknowledged touched buyers unique differentiated profile and it's broad potential to treat the 2.5 million patients worldwide with severe asthma, who are uncontrolled without requiring any phenotypic and biomarker testing.
We recently completed our acquisition of chemo, Sentrix, which adds tognino. So our portfolio top nios recently launched as a first in class treatment for anchor associated vasculitis or.
This is a serious systemic auto immune disease that leads to inflammation and eventual destruction of small blood vessels. This inflammatory disease can lead to permanent Oregon damage and in some severe cases can be life threatening tab.
Needless represents a significant advance in treatment for the eight to 10000 U S patients a year, who develop severe active disease or experience major relapses of AAV.
<unk> is often managed by rheumatologist, and Nephrologist, where Amgen has a strong market presence and successful track record, we look forward to applying our deep expertise and inflammation experience to help many more patients manage AAV with time news.
Moving to our hematology and oncology business are six innovative products grew 8% year over year with 10% volume growth.
<unk> strong volume growth in the courts or benefited from timing of shipments to our partners in Japan.
Our launch of limit crowds is progressing well.
With revenues of $75 million in the third quarter quarter over quarter sales declined to 3% driven by lower net selling price due to a 12 million dollar unfavorable price adjustment, resulting from our reimbursement approval in Germany.
This was partially offset by 15% volume growth.
In the U S. <unk> has been prescribed to over 3700 patients by over 2200 clinicians in both academic and community settings.
<unk> the U S. <unk> has now been approved in over 45 countries was launched in 13 markets and are rapidly pursuing reimbursement in the remaining markets. As we've noted before near term the market for a limit crashes focused on the 7000 U as in 20000 X U S patients and the second <unk>.
<unk> setting longer term, we expect <unk> to come from early airlines therapy, and the potential is luma crashed to treat other tumor types.
Sales of our oncology Biosimilars declined 25% year over year, while our biosimilars for ambushing <unk>, both hold leading shares we expect continued net selling price deterioration and accelerating volume to clients drill.
Driven by increased competition the.
The most recently published average selling price for <unk> in the U S declined 37% year over year and for <unk> declined 38% a year over year overtime, we expect longterm growth in our biosimilars business to be driven by the addition of new molecules and additional launches.
Bearing ourselves for the upcoming launch advantage of beta Archie Mara Biosimilar in the U S and early 2023.
Followed by the next wave of Biosimilar launches to still IRA Eylea and Solaris.
Overall, I'm very pleased with our execution in the quarter or international presence and diverse portfolio products position as well to deliver on the execution of our long term growth strategy and with that I'll turn it over to Dave.
Thanks, Murto good afternoon, everyone I'd like to start by welcoming our new colleagues from chemo Sentrix. We're excited that you are now part of Amgen.
For research and development third quarter was one of continued execution or represented new data on several programs and continued to progress are innovative clinical pipeline.
Beginning with General Medicine, this coming weekend at the American Heart Association meeting, we plan to present data from a phase two study of will pass around a leipoa protein literally targeting small interfering RNA molecule in subjects with elevated LP literally.
We also plan to present additional data from our path before in the past or open label extension studies, highlighting the association between the significant and sustained achievement of low and very low LDL cholesterol levels and lower rates of major cardiovascular events.
Data from the single and multiple dose cohorts of a phase one study of AMG 133, a multi specific that inhibits the gastric inhibitory polypeptide receptor are gipper and activates the glib one receptor will be presented at the 20th World Congress on insulin resistance diabetes and cardiovascular disease.
<unk> hybrid conference in December .
As a reminder, a unique aspect of being M. G. 133 is the inhibition of gipper, an innovative approach that we chose to take based on human genetic data suggests decreased expression of gipper leads to lower body mass index and lower weight.
We look forward to discussing them or have a annual pass around data along with an update on AMG 133 at our Investor call scheduled for Monday November 7th.
Turning the inflammation in September we presented data from the phase III sprout trial or Otezla treatment resulted in significant improvement and measures of moderate to severe plaques psoriasis at week 16, compared to placebo and children's ages six to 17.
We also presented data from the Otezla phase III discreet trial, where 16 week data demonstrated statistically significant improvements in genital psoriasis, including skin itch.
And quality of life in patients with moderate to severe disease.
Based on these results discussion with the FDA is ongoing for discrete to add clinical data to use prescribing information and discussions with regulatory authorities globally for sprout are forthcoming.
In September because fire was approved in the European Union and in Japan, and regulatory reviews continue in other jurisdictions.
And oncology, we presented data from <unk> Ah DLL, three targeting bite molecule being studying in patients with small cell lung cancer.
These data demonstrated encouraging anti tumor activity with notable response durability and survival.
In this setting Starlight amount delivered a confirmed overall response rate of 23% of median duration of response of 13 months and a median overall survival of $13. Two months, we continued to enroll patients in a potentially registration will phase two study in this setting.
We're also investigating carlotta map in combination with standard of care and first line small cell lung cancer in combination with AMG four O four a P. D. One inhibitor in patients with second line or later small cell lung cancer and in neuroendocrine prostate cancer.
In August we presented data from our room across checkpoint inhibitor and shipped to combination studies based on these data we continued to explore luma crass in both settings.
In September we presented data on Lima crafts in combination with Vectibix or this combination demonstrated encouraging efficacy and safety in patients with chemo refractory metastatic colorectal cancer.
Phase III trial continues to enroll using this combination.
We also presented data from the global Phase III code break 200, confirmatory trial or luma crash treatment led to increased progression free survival and a significantly higher objective response rate in patients with <unk> 12 feet mutated non small cell lung cancer compared with Docetaxel.
Patient reported outcomes were also improved with Lima crafts versus dos attacks.
We've just received initial top line data from a post marketing requirements study comparing the 960 milligrams daily dose of Luma crafts with a lower dose of 240 milligrams daily in patients with <unk> 12 C mutated advanced non small cell lung cancer.
Following discussions with regulators, we're planning to submit data from this study along with co break 200 confirmatory phase three data.
As a reminder, we are investigating multiple potential to pass the first line treatment of non small cell lung cancer with Lima, crass potentially segmented by PDL, one expression levels or the non small cell lung cancer population breaks down into roughly thirds across PDL, one high expressers inter.
Intermediate are lower expresses and PDL one negative expression.
We've seen promising early data in the PDR, one negative population and are planning to initiate a phase three study of Lou Macross, plus chemotherapy and first wallowing advanced or metastatic non small cell lung cancer.
Finally, I'm pleased to announce that the primary analysis of a phase three study evaluating the efficacy and safety of AVP 93, eight an investigational biosimilar to eylea compared with Hi, Leah met its primary endpoint in subjects with Neovascular age related macular degeneration with these data.
And previously announced phase III data from our Biosimilar candidates to Solaris Alara, we've completed our goal of delivering positive phase III data from three Biosimilars in 2000 2002.
In conclusion, with an innovative portfolio or approximately three quarters of our clinical stage programs have first thing class potential and a growing portfolio biosimilars, we're well positioned to continue to deliver important new medicines for patients and growth for shareholders over the near and long term I will now turn it back the ball.
Okay. Thank you, David and Joe small Wanna, We now open the lineup for.
Questions. If you would remind our colors of the procedure, we can get started.
If you would like to ask a question. Please redstart followed by one on your telephone keypad.
Any reason you'd like to remove that question. Please press star followed by two again to ask a question press Star one.
Our first question comes from South being Richter with Goldman Sachs. Your lines now open.
Good afternoon. Thanks for taking my question on an <unk> 133, and obesity could you just help us understand how you'll evaluate the data and in the context of existing therapies.
I've I've moved forward decision and how you're thinking about differentiation here. It's just a matter of taking a piece of the market given sides or or do you think there's there's other aspects here to the program.
Once you took the push up thanks <unk>. We know there was a lot of interest in this program and as we mentioned will be showing the data in full.
In the first week of December at the hybrid corn conference.
Obesity is a large.
Very heterogeneous disease, it's global public health problem.
The things that I would look for in a.
Evaluating this molecule going forward will be the dosing dosing interval what are the kinetics of weight loss.
Rapid is that weight loss whether sustainability.
And then finally, the overall Tolerability, we do plan on using our extensive capabilities in human data to help shape our thinking.
And guide this development program and as we move forward.
Okay.
Let's take the next question. Our next question comes from Matthew Harrison with Morgan Stanley Your lines now open.
Great. Good afternoon. Thanks for taking my question I wanted to ask a question now that you've you've been through more hopefully been through most of the contracting season for next year I think one of the key investor concerns is obviously with Biosimilar humira coming next year, what impact that could have to <unk> pricing die.
<unk> for next year. So I'm wondering if you can just comment on on how to think about the potential impact too <unk> and it's <unk>.
Pricing next year. Thanks.
Thank you Matthew smartphone.
We are obviously excited about the opportunity to launch the first biosimilar tissue Myra and so where we are active in our discussions with payers and pbms for that.
We are not seeing a massive amount of change two embryos access going forward and we continue to believe we've got.
Good regard on the part of the pears in Pbms for the efficacy and safety of Enbrel.
And if there were to be a change in enbrel.
Pricing it would be for volume gains as I mentioned in my opening remarks were declining and volumes about 3% a.
Year on year, our goal is to maintain that.
And maybe even improve upon it but we're.
We're not quite finished in the contracting cycle.
Okay, just one let's go to the next question. Please.
Our next question comes from <unk> with Evercore. Your line is not open.
I got it thanks for taking my question I have a two part question on what everybody wants to talk about which is obesity. So lillian no load. The two lead players in the glib space. They both have or at least age programs I'm talking phase one stage programs on triple agonist et cetera, and one thing that always emphasizes that they have certain pre defined thresholds for moving and.
Any of those programs forward in those thresholds are off of incremental efficacy beyond the current most competitive products out there and my question is I imagine you were thinking about some of those thresholds to relative to Mongiardo, perhaps cagney with Emma and you think about the progression of your program and and I'm curious if you could speak to that and <unk>.
<unk>, if you could just clarify for us the low and the high dose data from single ascending dose you showed at your.
Business review early in the year was that an average up the first three and the highest three of the six cohorts in phase one or was it. The first two out of the six course I wasn't quite sure what the low and the high meant within the single depending dose and I'm I remember there were six different courts within single sending thank you very much.
Yeah, we'll get back to you on the latter half of that question I'll remember off the top of my head what that is but.
We're going to have it in a month, you'll have the full data set with all of the Ah cohorts broken out so.
I think at that point it it will be very clear in terms of thresholds.
As I discussed a short while ago.
Any potential avenues to differentiation here of course degree of weight loss is one of them, but also dosing interval what the kinetics are importantly, durability importantly, tolerability since a fair number of patients transition off of these agents for Tolerability. So those are the sorts of things that will be taking a look at.
As we assess whether we've got a differentiated products and it's worth or scale investment.
Our next question comes from Michael <unk> with Jeffries.
Your lines now open your lines.
Thank you.
I'm Gonna ask another follow up on 133, David last Court you said you actually started the phase two I actually didn't hear that here can you just talk about the actual status of where you are with 133 am.
And all showed the fact that I believe it's been disclosed that you dialed back <unk> see so we should not be expecting material diabetes types effects and this is not what we're looking for are people should be examining our scrutinizing. Thank you.
Yeah, No I don't believe we announced we had started phase II, Mike, but rather that were in planning we do expect initial.
Initiating the phase two trial in the relative near term and once that gets launch of course, we'll talk about design.
And give guidance in terms of expected data availability.
I wouldn't over think.
The grip, one component and I'm not sure.
That's on point.
Again, when we share the data in a month, you'll get a look at that.
Thank you.
Our next question comes from J Olson was Oppenheimer.
Your lines now open.
Oh, Hey, congrats on the quarter and closing the chemo centric steel.
You have a lot of volume growth outside the U S. In the third quarter and as an example, I think you said repast <unk> 73 per cent X U S with inclusion on China's national drug reimbursement list.
Can you talk about the piece of product launches.
Outside the U S and volume growth and how do you expect U S vs X U S revenue mix to evolve over time. Thank you.
Yeah.
Sure I think.
<unk> is a good example of how.
Now with our broadened international presence, we're able to bring new.
New products and new launches to the market fairly quickly.
What we're seeing in China's rapid expansion of rapacity recall, we were on the market for just over a year prior to securing Nash.
National reimbursement government. So we did establish good understanding education awareness of Repass, we were promoting it primarily for <unk>.
Percutaneous coronary intervention patients who are stand patients.
Where.
Unmet need was deemed to be highest amongst the private cash pay patient group, but.
I think what you're seeing is the there's real demand in these markets to help millions of patients who are at very high risk of coronary vascular disease and so we're.
We're continuing to build out our business in Japan, and China, We had good volume growth in Europe , and obviously, we also had good volume growth in the U S. So we're excited about the evolution of Rip Alpha and we continue to feel good about how that product will drive.
Volume and revenue growth for us in the future.
With respect to other launches the other good example that we are seeing is just the <unk> launch given that we've got approval in roughly 40 markets. We've got reimbursement in roughly 30 markets and we're pursuing.
Reimbursement in the remaining countries.
Our our teams are oncology teams around the world doing a very nice job of identifying curiosity 12 C. Second line patients and making sure that they have a <unk> as a treatment option. So I'm I'm really pleased that the.
International presence, we've been building for many years now is in full place is functioning at a high level and delivering strong volume growth going forward. We have some partner products, where we don't necessarily have the launches in every country, where we have our partners to do that but.
But wherever Amgen has the global responsibility and rates for products.
Feeling very good about our potential and ability to launch them globally.
Let me just don't forget.
The slides.
Sure abuse afternoon, we have to be outside the U S.
Data available free on all the different products.
<unk> contribution from international business there.
Our next question comes from Jeffrey Meacham with Bank of America. Your line is now open.
Hey, this is Charlie I'll input shaft. Thanks for taking a question and congrats on the the results.
Questions regarding the I guess the I V. S was still there are a couple potential lunchtime you I think <unk> no you you mentioned that.
Yosemite submitted the still the raw data show the F. D. A I'm wondering you know you are expecting to see the product a bunch <unk> second half of next year.
And whether you anticipate how any pushed back follow up on J&J and I guess similarly, <unk> timing is in the <unk> 24 timeframe and if you anticipate any pushback followed probably general thank you.
Yeah. Thanks for the question Charlie We're we're obviously pleased with a successful data readouts on those products and some that have been.
Been filed.
We expect to be in the first wave of those biosimilar launches in.
We're not disclosing specific launch timing on those fries.
Jason Let's take the next question.
Our next question comes from.
Evan senior men with BMO capital No lines now open.
I got it. Thank you so much for taking the question I'm not gonna ask about 133, but rather on luma craft. So you had mentioned you had data from the dose reduction trial can you characterize how we should think about the relative efficacy of the lower doses versus the approved dose and on the Pembroke combination trial noticing the slide you talked about a dose expansion with a lower dose <unk> are you.
You also treating in combination with that lower dose.
Yeah. Thanks Evan.
We understand that there's a lot of interest in the dose comparison data.
Just getting the top.
Topline results to the FDA and other regulatory authorities. So it's premature to share these data prior to their review.
The appropriate conversations.
In regards to the combination trial I believe you're referring to.
Checkpoint inhibitors, we're doing a lower dose lead in as I've mentioned before and then layering on top of that dosing.
Checkpoint inhibitors. So they are then given concurrently.
Going forward.
Okay. Thank you.
[laughter].
Our next question comes from the <unk>.
Wells Fargo.
Alright, Thanks for taking my question.
That's in the Quad results. So I have a question regarding that.
The 30% plus Utah.
<unk> declined that'd be have seemed at the bus couple by it similar.
Is it is it is it is unexpected lies.
So you are 40 years after launch and how should we think about the other by some that you have a new portfolio. How should you think about the long term pricing dynamic data because it wasn't expecting an expectation that the pricing would probably stabilised after a certain point, but he doesn't seem like that and buy some of their life.
Thanks for the question I think what what's.
What's important to remember when you're thinking about U S biosimilars as products and the.
Bye and bill or medical benefits side will continue to see price declines over time because of the way in which they average selling price calculation works products on the pharmacy benefits site, So think Medicare part D products or commercial insured.
Retail pharmacy products, they are likely to have.
Slower declines in the slope of their net price overtime now both of those conditions depend on how many competitors for each molecule. So everyone's a little bit different but I would hesitate to put a timeframe on the class of products I think you need to look at each one of the molecules.
One thing I will say is we've been very clear and where we're going to get growth in our biosimilars portfolio and that's by launching successive new biosimilars on top of.
Continuing base of business outside the U S biosimilar pricing tends to come down fairly rapidly and then can hold in some of the larger what we call retail markets and in markets, where it's a heavy tender business prices will continue to decline as long as they're a competitive market.
Okay.
Absolutely.
Thank you. Our next question comes from the <unk> with Cohen lines now open.
Great. Thanks for taking my question I got just a couple of maybe the first one on 173 can you comment it's an antibody can we assume it's monthly dosing.
And then secondly for 93rd yet against me now.
No that was gonna be <unk> eight milligrams approved it's obviously the same underlying drawing just the different formulations, how does that impact what you need to do to bring into high dose 930 to market and other jobs versus the fiscal year 25 potential lunch. Thank you.
Yeah, Let me take the first part on 133.
It is it's.
As I said, it's a multi specific or by functional molecule meaning.
An antibody component that inhibits the gipper.
Receptor.
And then there's a component that agonizes glib one so.
As you noted you can expect and the body like pharmacokinetics.
And we will be sharing all of that.
A month, but.
That's what you will drive the dosing interval on 938, let me ask Murdo to comment briefly on that.
You are only we continue to.
Want to be able to have a.
A full complement of competitive.
Biosimilar products that compete effectively with their innovative products and with I think done that very successfully thanks to the talented team and our formulation and process development organization. So we feel confident that we'll be able to bring.
Various concentrations across the portfolio as needed.
So.
We're working on that one.
Let's go to the our next question comes from David risen Jerry with SBB Securities The lines now open.
Great. Thanks, very much so.
So my question is on Biosimilars timing for 2023, please regarding M davita.
In light of your Interchangeability study, which has an estimated completion in January assuming that succeeds when in 2023 do you think F. D. A will add interchange ability took a label and then is the Amgen planning to launch Biosimilar Solara in September at risk if patent.
<unk> remains outstanding Thank you.
Yeah. Thanks again for the question.
That may be take the second part first where we haven't made any statements about when we will launch our Biosimilar star, but we're pleased that we've got.
Strong data in hand and.
We're pleased that we've got.
The strength of the Amgen manufacturing network and commercial organization ready to go.
And we will track that state that space closely we expect to be in the first wave of launches on still are highly on Solaris.
Next wave of new Biosimilar launches and we expect to be in the market and.
Early fab in the new year with empty Oveta.
The interchangeability, that's an interesting one I think over time that may grow in importance.
But being first with <unk>, we understand it to be a lower priority from payers and pbms.
But we do expect to have interchange ability.
And irrelevant timeframe for when the other biosimilar entrance to hew Myra come into the market.
Yeah. Thank you have a question.
Next question comes from Robin car Nonstick us with choose your line is now open.
Hi, Thanks for taking my question I'm, just gonna follow up with you on the Enbrel comment ahead.
Ahead of the biological extramarital lines, we've heard that April is often used as a.
Third or second line TNF and so I was just curious whether.
You'd notice that you don't expect further pricing decline.
Part of it is that went to and well he might relaunches that really you're already having any blood or if you've already got to enroll in many cases and that's why there may not be a motivation to have to compete on price just try to clarify that the detailed questions. Maybe help me understand the dynamics there. Thank you.
Yes, Robin thanks for the opportunity to clarify I didn't say that we don't expect continued price declines on Enbrel I said, we don't expect the current price declines to be dramatically different going into next year. So we do expect to continue to concede price on enbrel is categories quite competitive.
But we don't see the slope of that changing dramatically.
And Enbrel is used across a broad range of patient types in rheumatoid arthritis as well as in <unk>.
Sorry, I think arthritis, I think what we see as we see a lot of frontline usage still and we do see some post TNF frontline usage. So.
I think that will continue not every patient is going to respond to TNF inhibitor and many clinic.
Clinicians prefer the well demonstrated safety and efficacy profile of Enbrel and we think that will continue despite biosimilar options in the market.
So that that that hopefully clarifies your question.
Our next question comes from corn Bristow with UBS. Your line is now.
Hey get off the needing congrats on the quarter. So I'll take another one on one side to me if I may as we think about timeline.
Many and neither around five to six years to move <unk>.
For me. This is in phase two initiation to the market is there any reason at all for us to think that there's any sort of <unk> you could explore and just what day of the appointment and time lines in mind.
The fact that this efficacy ball that we see now could be raised by what other pets are asset to the head of you does this raise the ball for progression to phase two from your side. Thank you.
Thanks for the question.
The.
Let me start with again the disease itself obesity, which is very heterogeneous disease. Obviously, it's one of the major public health problems globally right now our belief is that there are a number of diseases tucked within the label that will lead to.
Some patients have primarily cardiovascular manifestations others.
To buy a diabetes others mechanical problems.
So as I noted, we will be using our human data capabilities to further understand and potentially segment. These populations to determine if there can be particular benefit.
In some segments of patients and then I would.
Just remind you of the things that will look for in this program as we go forward to see whether we have differentiated molecule or not dosing again, the kinetics in particular pity and sustainability of weight loss and overall tolerability. Those are the things that will be looking at.
As we take a look at phase two data and determine as the field unfolds, where we go from there.
Let's take the next one.
Our next question comes from partner Gould with Barclays. Your line is now open.
Great. Thanks for taking my question, sorry to beat a dead horse here, but to follow up on the on the prior question. How important is it that you also perceived diabetes alongside any <unk>.
Any indication or do you feel like you could just go after obesity and that might.
Be able to suffice it and workout commercially thank you.
Yeah.
And thanks Carter that's a question will address as we go forward, but you don't feel that it's essential.
B a diabetes medication.
As I said this is obesity powers, a large number of diseases and.
We're going to guide our development to where we think we get amongst effect size.
Our next question comes from Michael Schmidt.
Your line is now open.
Hi, This is T V M for Michael Thanks for taking our questions. We have one go months without coming out of a wolgamott confidence with updated data.
Emotion <unk>.
One two how do you think.
<unk> they can.
<unk> <unk> do you have any of you and would you prioritize.
Data so far thank you.
Yeah, no in terms of the combinations shipped to checkpoint inhibitor combinations were were enrolling phase two trial now with the ship to combination that will guide our development.
That's a combination that could potentially be applied regardless of PDL, one expression levels and then as I mentioned, we are exploring in the PDL one positive population.
A low dose running of luma craft's been followed by layering on of the checkpoint inhibitor.
As those trials and roll I'll provide guidance in terms of when we have data readouts and those data will determine how we think about the first line population. Finally, let let me remind everyone again in the PDL one negative population, we're going to be looking at a chemotherapy, possibly macross combination.
And I see one more participant in the queue. So let's take one last question after Richard Bob will make some closing comments.
Our final question is from Tim Anderson with Wolf Research. Your line is now open.
Thank you I wanted to ask.
Two part Biosimilar question related just to the U S market and that's what you think uptake will be like in two disease areas that are a little different than most so in the rare disease space, where you'll have a bottomless layers.
Then in the eye space with your Biosimilar I Leah.
How do you think those will compare these areas, where we already have precedence such as an oncology I know the ice maybe some buying bill I think rare diseases is not buying bill, but if you could compare those please.
Yeah. Thanks for the question.
As I mentioned before you do have to look at each product slightly individually and the circumstances that would that would generate or drive uptake.
If we go back to the oncology Biosimilars, we had an assumption at the beginning of those products that patients may not get switched on.
The maintenance phase of their treatment, so mid cycle or mid course of treatment and what we saw at least in the buying bill space for both and <unk> was that encore.
Colleges were comfortable with the quality of the Amgen Biosimilars.
And by the fact that they had access to our our medical teams in our salespeople who were at their calling on them.
To help them understand.
The data behind our Biosimilars and so we did see.
Mid course of treatment switching to our Biosimilar, So I think.
The threshold for what we thought would be hesitancy on the part of the prescriber was different and I think that we are looking closely at both.
Hilarious prescribers and Eylea prescribers and we've done some in market research with with both customer types and we feel good about our opportunity to.
Create value for the healthcare system by offering.
Biosimilar alternatives to those two branded products and we feel good about our chances of having decent uptake on both.
Okay, We will get let me. Thank all of you for joining our call. We appreciate your interest in Amgen.
And let me just end by saying that we.
We remain focused on your strong and positioning ourselves for <unk>.
<unk> 23, and beyond we look forward to having a chance to engage with you again here in a few short weeks.
Monday, and then in a few short weeks thereafter root beers conferences. So thank you we'll look forward to seeing you soon.
Thanks, everybody.
This concludes our 2022 Q3 earnings call you may now disconnect.
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