Amgen's Lumakras off to a strong start toward analyst's blockbuster predictions pegged to combo potential

Approved in May—three months ahead of schedule—and becoming a first-in-class treatment for a certain type of lung cancer previously thought to be undruggable, Amgen’s Lumakras is off to a promising start.

On Tuesday, when the company reported third-quarter earnings, Lumakras came in at $36 million for a cumulative $45 million since it launched for non-small cell lung cancer with the KRAS G12C mutation.

“Lumakras has been prescribed by over 500 oncologists in both academic and community settings. A majority of clinical laboratories have updated their testing reports to reflect KRAS G12C as an actionable mutation, and approximately 75% of patients with non-small cell lung cancer are now being tested for the mutation at the time of diagnosis,” Amgen’s commercial operations chief Murdo Gordon said. “I’m very pleased with the Lumakras launch uptake in the U.S.”

With regulatory reviews ongoing in Europe and Japan, those markets would further boost sales.

Competitors targeting the KRAS mutation are coming at Lumakras—most notably Mirati Therapeutics—but Amgen’s treatment has a valuable head start.

“We think the early Lumakras trends are encouraging and that Lumakras will continue to be the leader in the field for KRAS G12C if others enter the market,” wrote Cantor Fitzgerald in a note to investors. “Being the first to market and because of the positive feedback from prescribing physicians, it will be difficult for competition to significantly penetrate Amgen’s market share.”

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The analysts estimate Lumakras sales to hit $57 million in the fourth quarter and $350 million in 2022 and see much more potential for growth with positive readouts from trials of combo treatments, particularly for colorectal cancer.

“Multiple, late-stage Lumakras combination studies have multiple shots on goal, which is how we think the product could become a multibillion-dollar asset for the company,” wrote Cantor Fitzgerald.

Amgen also reported that its psoriasis and psoriatic arthritis treatment Otezla increased sales by 13% year-over-year in the third quarter to $609 million despite a price drop. A December decision due from the FDA on Otezla’s potential label expansion to include mild-to-moderate plaque psoriasis brings the possibility of an additional 1.5 million patients. Otezla's existing psoriasis approval is for moderate-to-severe patients.

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Amgen presented other encouraging developments in the pipeline, prompting an optimistic assessment from Piper Sandler analyst Christopher Raymond.

“We think management does have an urgency around remaking the product mix with recent BD activity in oncology and inflammation,” Raymond wrote. “And given the strong operational track record, we want to own this name for the transformation of the product mix.”

Overall, Amgen reported revenue of $6.7 billion, up 4% from last year and 14% from the previous quarter, driven by higher demand and partially offset by “net selling pressure across various products,” Cantor Fitzgerald wrote.

“Our robust pipeline of potential new medicines across all stages of development sets us up well to drive growth over the long term,” Amgen CEO Robert Bradway said.