Are Amgen's Patent Worries Hiding Its Real Growth Engine?

Markets are focused on Amgen's (AMGN) legacy drugs facing patent cliffs, but a new metric reveals a faster-growing core business is already taking over. According to a Trefis analysis, the patent cliff fears may be hiding the company's real growth engine.

Recommendation Change

No analyst recommendation change was reported in the article, but the analysis suggests investors may be overestimating patent expiration risks.

Analyst's Rationale

Trefis argues that Amgen has a portfolio of newer products growing rapidly, such as rare disease and oncology drugs, which could offset declining revenues from older drugs. One key number shows that revenue from newer products accounts for an increasing share of total revenue.

Context

Amgen's stock (AMGN) has been negatively impacted by patent expiration fears for drugs like Enbrel and Prolia. However, the company has invested heavily in R&D and secured approvals for new drugs such as Lumakras and Tezspire.

What We Conclude

While patent cliff concerns remain, Amgen may have a strong internal growth engine that is not fully appreciated. Investors are encouraged to look beyond legacy drugs and evaluate the potential of new products.