By Deena Beasley
(Reuters) -Amgen on Tuesday said its second-quarter profit slipped 1% as higher expenses, including costs related to development of its experimental obesity drug MariTide, offset a 20% increase in revenue driven by the biotechnology company's October acquisition of rare disease drugmaker Horizon Therapeutics (NASDAQ:HZNP).
Amgen (NASDAQ:AMGN) reported adjusted earnings of $4.97 per share, which was 3 cents shy of the average analyst estimate, according to LSEG data.
Quarterly revenue of $8.39 billion was slightly ahead of the $8.37 billion forecast by analysts.
"The quarter overall looks fairly uneventful," Mizuho analyst Salim Syed said in a research note, adding that the earnings miss was driven by slightly weaker margins and a slightly higher share count.
Amgen shares, which closed up 1% at $328.95, were down 2% after hours.
Second-quarter sales of cholesterol drug Repatha rose 25% to $532 million, while sales of older rheumatoid arthritis drug Enbrel fell 15% to $902 million.
Sales of Tepezza, Horizon's thyroid eye disease drug, rose 7% from a year earlier to $479 million, while gout drug Krystexxa saw sales rise 20% to $294 million.
Excluding Horizon's drugs, Amgen said product sales grew 5%.
Investors are focused on progress with the weight-loss drug MariTide. The company said it expects to have initial data from a mid-stage trial of the medicine late this year.
It also plans to begin human testing of a different obesity drug candidate before the end of the year.
For MariTide, "we are laser focused on preparing to quickly launch a broad Phase 3 program in obesity, obesity-related conditions and diabetes," Amgen Chief Financial Officer Peter Griffith said in an interview.
Some analysts have forecast the market for new drugs for weight loss reaching $130 billion a year by the early 2030s.
Griffith said Amgen raised its capital spending target for full-year 2024 to $1.3 billion from $1.1 billion due in part to investment in MariTide and its manufacturing.
Amgen also raised the lower end of its 2024 revenue outlook to a range of $32.8 billion to $33.8 billion from a previous low end forecast of $32.5 billion.
Amgen narrowed its 2024 adjusted earnings estimate and now expects a profit of $19.10 to $20.10 per share, compared with its previous view of $19.00 to $20.20.
Analysts have forecast 2024 earnings per share of $19.51 on revenue of $33.1 billion.