On Tuesday, Morgan Stanley (NYSE:MS) maintained an Equalweight rating on Amgen (NASDAQ:AMGN) shares, with a steady price target of $22.00. The firm's analysis followed Amgen's announcement of Phase 2 trial results for its diabesity treatment, MariTide. The data reportedly aligns with the outcomes anticipated in one of the scenarios Morgan Stanley had previously outlined.
Amgen's recent press release detailed that MariTide showed significant weight loss in obese patients, with up to 20% average weight reduction at the 52-week mark, which is comparable to weight loss results from Eli Lilly (NYSE:LLY)'s Tirzepatide. In type 2 diabetes patients, MariTide resulted in up to 17% weight loss and a notable decrease in average HbA1c levels. The company also highlighted the absence of a weight loss plateau in both patient subsets.
The treatment demonstrated a discontinuation rate of approximately 11%, with less than 8% discontinuing due to gastrointestinal-related events. The release also mentioned that the incidence of nausea and vomiting was substantially reduced with dose escalation. No new safety concerns were identified, and MariTide was noted to improve various cardiometabolic parameters without significant increases in free fatty acids or negative impacts on bone mineral density.
Morgan Stanley awaits further details from Amgen's conference call, particularly regarding the choice of Phase 3 dose and schedule, dose response, the shape of weight loss curves, and placebo response. The firm also noted the context of recent policy uncertainties affecting the broader sector, which has been a topic of investor conversations.
For its base case, Morgan Stanley projects worldwide unadjusted sales of MariTide to reach approximately $5.9 billion by 2033. The firm estimates that Amgen's base business, excluding MariTide, is valued at roughly $220 to $240 per share.
In other recent news, biotechnology company Amgen has seen significant developments. The company's Q3 revenues increased by 23%, reaching $8.5 billion, and projections for 2024 revenues range between $33.0 billion and $33.8 billion. Amgen has also announced the appointment of Howard Chang, M.D., Ph.D., as its new Senior Vice President of Research and Chief Scientific Officer.
Citi initiated coverage on Amgen with a neutral rating and a $335 price target, focusing on the potential impact of MariTide, the company's treatment for obesity and diabetes. Other analyst firms such as TD Cowen, Jefferies, and Cantor Fitzgerald have maintained their Buy or Overweight ratings for the company, with price targets ranging from $383 to $405.
BMO Capital Markets has also maintained an Outperform rating on Amgen with a price target of $362.00, while Barclays (LON:BARC) reiterated an Equalweight rating, maintaining a price target of $315.00.
Amgen's drug candidate, MariTide, has attracted attention due to concerns about its effects on bone mineral density and heart rate increases. Despite these concerns, TD Cowen and BMO Capital Markets have expressed confidence in the drug's safety profile based on larger data sets. These are recent developments that have shaped the investor perspective on Amgen.
InvestingPro Insights
To complement Morgan Stanley's analysis of Amgen's MariTide trial results, InvestingPro data offers additional financial context. Amgen's market capitalization stands at $158.03 billion, reflecting its significant presence in the biotechnology sector. The company's revenue growth of 21.25% over the last twelve months and 23.18% in the most recent quarter indicates strong financial performance, potentially supporting its research and development efforts in treatments like MariTide.
InvestingPro Tips highlight Amgen's consistent dividend history, having raised its dividend for 14 consecutive years. This suggests financial stability, which could be reassuring for investors considering the company's long-term prospects in the competitive diabesity treatment market. Additionally, Amgen's profitability over the last twelve months aligns with analysts' predictions for continued profitability this year, potentially providing resources for further development of MariTide and other pipeline products.
For investors seeking a more comprehensive analysis, InvestingPro offers 7 additional tips that could provide deeper insights into Amgen's financial health and market position.
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