- Baird is out in defense of Amgen (NASDAQ:AMGN) noting the shares have been buffeted recently by a wave of negative sentiment regarding Aranesp, with concerns about safety, biosimilar legislation, Mircera competition and reimbursement. For their part, they think the only substantive risk here relates to safety. After a comprehensive review, the firm sees that risk as both manageable and more than in the stock.
First, while AMGN has reported negative results in anemia of cancer (AOC), they believe any moderation in AOC use can be offset by share gains pre-dialysis for example. Second, in Aranesp's labeled indication-chemotherapy-induced anemia (CIA), they think clinical and commercial risks have been blown out of proportion.
Firm recalls, a survival trial in small-cell lung cancer is expected mid-year. While it is entirely possible that the outcome may be negative, the firm thinks the preponderance of existing data indicate at least an equivalent survival benefit between Aranesp and control.
Third, with heightened EPO scrutiny, they find it hard to support the additional bearish argument that Mircera will be imminently approved.
Reiterates Outperform rating, $90 price target.
Notablecalls: While I don't think the call is outright actionable from the trading perspective, it does highlight the right things. NC was outgamed in AMGN couple of days ago in a pretty classic way. If you check the comment posted under the AMGN call and compare the timing to the chart you'll see capitulation happened right around the bottom (as it always does, of course). I do suspect that some of you did make some dinero on the initial call but in case you're trading lots greater than say 10,000 shares it didn't go a long way in helping your performance. Was there a lesson here?
First, while AMGN has reported negative results in anemia of cancer (AOC), they believe any moderation in AOC use can be offset by share gains pre-dialysis for example. Second, in Aranesp's labeled indication-chemotherapy-induced anemia (CIA), they think clinical and commercial risks have been blown out of proportion.
Firm recalls, a survival trial in small-cell lung cancer is expected mid-year. While it is entirely possible that the outcome may be negative, the firm thinks the preponderance of existing data indicate at least an equivalent survival benefit between Aranesp and control.
Third, with heightened EPO scrutiny, they find it hard to support the additional bearish argument that Mircera will be imminently approved.
Reiterates Outperform rating, $90 price target.
Notablecalls: While I don't think the call is outright actionable from the trading perspective, it does highlight the right things. NC was outgamed in AMGN couple of days ago in a pretty classic way. If you check the comment posted under the AMGN call and compare the timing to the chart you'll see capitulation happened right around the bottom (as it always does, of course). I do suspect that some of you did make some dinero on the initial call but in case you're trading lots greater than say 10,000 shares it didn't go a long way in helping your performance. Was there a lesson here?
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