Amgen Inc. (AMGN, Financial) informed the market June 7 through the PR Newswire that the members of the Food and Drug Administration’s Oncologic Drugs Advisory Committee will get together on July 13 to examine Amgen's Biologics License Application (BLA).
The global health care company headquartered in Thousand Oaks, California, is seeking approval for its ABP 215, a biosimilar candidate to Roche's Avastin, the brand name under which bevacizumab is commercialized.
Subject to the Biosimilar User Fee Act, the Food and Drug Administration’s action date is targeted for Sept. 14.
Besides ABP 215, Amgen is jointly working with Allergan (AGN, Financial) for the development of three other oncology biosimilars and their commercialization. ABP is being developed and commercialized by Amgen and Allergan according to a collaboration agreement that the two health care companies reached in December 2011.
As a biosimilar to Roche’s bevacizumab, ABP 215 will be used for the treatment of those pathologies that are caused by the growth of new blood vessels (angiogenesis). Acting as a monoclonal antibody in the anti-tumor immune therapy, ABP 215 is intended to prevent angiogenesis and will therefore be used for the treatment of various forms of tumors, including colon, rectum, lung and kidney cancer and some eye diseases.
Once ABP 215 has obtained the approval for its commercialization in the U.S., Amgen will update its portfolio of products with another one for cancer treatment. The health care company produces and markets Neulasta, the brand name under which Amgen’s pegfilgrastim is used in the anti-tumor chemotherapy. Neulasta is one of Amgen’s most sold products with 20% to 25% of the company’s total revenue coming in from its sale.
Amgen closed the first quarter of 2017 with revenue coming in at $5.199 billion and for the next quarter and full year 2017 analysts forecast that Amgen will make revenue of $5.66 billion and $22.59 billion.
Amgen is trading at $162.95, up $1.29 per share or plus 0.77% since Wednesday with a price-earnings (P/E) ratio of 15.48, a price-book (P/B) ratio of 3.92 and a price-sales (P/S) ratio of 5.23.
The forward P/E ratio for Amgen is 12.88 that, multiplied by an EPS of $12.45 as forecasted by analysts for full fiscal 2017, gives a value of $160.356. Compared with the current share price that leads to the conclusion that this health care stock is a little bit overvalued by the stock market.
The analysts’ average target price is $180.83 per share which represents a nearly 11% upside from the current market valuation.
The recommendation rating for Amgen is 2.4 out of 5.
Disclosure: I have no positions in any stock mentioned in this article.
