The U.S. Court of Appeals for the Federal Circuit affirmed a New Jersey federal court’s ruling that biopharmaceutical company Amgen’s (NASDAQ:AMGN) patents covering the psoriasis drug Otezla are valid, prohibiting Novartis’ (NYSE:NVS) Sandoz and Zydus Pharmaceuticals from selling their generic versions of the drug until February 2028.
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However, the Federal Circuit upheld a decision to invalidate one of Amgen’s patents that, as per Sandoz, would have barred its generic versions of Otezla until 2034. A spokesperson for Sandoz told Reuters that the company welcomed the decision, as it allows the sale of Otezla generics in 2028 instead of 2034.
Amgen purchased Otezla from Celgene Corp in 2019 for $13.4 billion. The company generated revenue worth $2.3 billion through the worldwide sales of Otezla in 2022, reflecting a 2% growth from the prior year. Otezla accounted for over 9% of the company’s overall product sales last year.
Amgen is facing increased competition and stagnating sales for many of its key products. The company’s revenue increased 1.3% to $26.3 billion in 2022. It expects 2023 revenue in the range of $26 billion and $27.2 billion. Amgen’s outlook doesn’t include the proposed acquisition of Horizon Therapeutics, which it expects to complete in the first half of 2023. Amgen is acquiring Horizon for about $28 billion to expand its portfolio of rare disease treatments.
What is the Target Price for Amgen Stock?
Wall Street is sidelined on Amgen stock, with a Hold consensus rating based on six Buys, seven Holds, and three Sells. The average price target of $253.31 implies nearly 3% upside. Shares have declined more than 6% since the start of 2023.
