By Bill Berkrot
NEW YORK (Reuters) - Amgen Inc said it expects generic versions of biotech drugs, known as biosimilars, to be a multibillion-dollar opportunity for the company and has targeted some of the industry's biggest sellers, including the main rivals for its own blockbuster rheumatoid arthritis drug Enbrel.
The company on Thursday also said that between this year and 2016 it will have key late-stage data from eight experimental medicines.
Amgen Chief Executive Robert Bradway, at a meeting in New York to update analysts and investors on business strategy, said the company plans to launch six biosimilars beginning in 2017 - four cancer drugs and the two Enbrel rivals - Abbvie's Humira and Remicade, which is sold by Johnson & Johnson and Merck & Co Inc.
It also plans to launch biosimilar versions of Roche Holding AG's multibillion-dollar cancer drugs Avastin, Herceptin and Rituxan, as well as Eli Lilly and Co's Erbitux.
"They went after six of the largest biologics in the market with a total of over $40 billion in revenue. But they laid out this big goal without a lot of specifics," said RBC Capital Markets analyst Michael Yee, who is looking for details on pricing and the types of studies the company will conduct to bring its biosimilars to market.
"Certainly biosimilars are an important driver to 2017 and beyond, but we'd like more specifics."
The world's largest biotechnology company believes it has a unique capability to become a major player in biosimilars once U.S. health regulators finalize the approval pathway for such drugs, which are not identical matches of the branded medicines in the manner of traditional generic versions of pills.
"The company is clearly straddling two business opportunities that sometimes seem in conflict with each other - a defender of the innovative products and a participant in biosimilar products. That tension is going to continue to be difficult for them to manage," said Sanford Bernstein analyst Geoffrey Porges.
Amgen research chief Sean Harper said the company was viewing biosimilars as more of a global opportunity. "We feel that these medicines are very valuable and in many parts of the world patients have no access to them because they are so expensive," he said.
Enbrel, which had 2012 sales of $4.2 billion and has patent protection into 2028, will become more profitable at the end of the year, when a profit-sharing arrangement with Pfizer becomes a royalty payment. That will result in an operating profit of about $800 million in 2014, the company said.
Amgen raised its 2013 earnings forecast to account for a tax credit due to federal settlements for prior years. Amgen now expects adjusted 2013 earnings of $7.05 to $7.35 per share, and said it would record the credit in the first quarter.
The company last month forecast earnings per share of $6.85 to $7.15. The 2013 revenue forecast remains unchanged at $17.8 billion to $18.2 billion.
Chief Financial Officer Jonathan Peacock said Amgen will continue to return more than 60 percent of adjusted net profit to shareholders through dividend increases and some share buybacks.
The company also said it plans to continue to pursue strategic acquisitions, and that it expects to expand its business into major Asian markets in 2015 and 2016. "The fact that Amgen was not present in Japan and China was a noticeable gap," Bradway said.
"They are a bellwether for the industry," Bernstein's Porges said of Amgen. "The real focus is getting into lower-priced markets and lower-priced products and driving business through cost efficiencies. That tells you something about the state of the industry."
Harper provided an update of the company's drugs in development in several therapeutic areas, including medicines for a variety of cancers, heart disease, osteoporosis and psoriasis.
The cancer drugs include trebananib for ovarian cancer with key late-stage data expected in mid-2013, and rilotumumab for advanced gastric cancer, a huge unmet need in China and emerging markets. Late-stage data on that drug is due in 2016, just about the time the company sees making a move into China.
Amgen's highest-profile drug in development is AMG-145, its cholesterol fighter from a closely watched new class of medicines called PCSK9 inhibitors meant to be taken by patients unable to tolerate statins, like Lipitor and Zocor, or those who fail to reach LDL goals with statins. In earlier clinical trials, PCSK9 inhibitors have dramatically reduced bad LDL cholesterol.
The class, which blocks a protein that prevents the body from removing artery-clogging LDL cholesterol from the bloodstream, is a hot area of research being pursued by several companies, including Regeneron Pharmaceuticals Inc in partnership with Sanofi SA, and Pfizer.
Amgen has begun a Phase III AMG-145 program with more than 26,000 patients over seven studies. It expects to have initial Phase III data in early 2014, and estimates having results in 2018 from a large so-called outcomes study to demonstrate that it can reduce heart attacks and strokes.
Harper said he was confident that AMG-145 would show "a decrease in cardiovascular outcomes". He added: "This will be the biggest study Amgen has ever done."
He expressed similar confidence that romosozumab for post-menopausal osteoporosis would prevent fractures in a pair of late-stage trials of about 6,000 women, with data expected in 2015.
Tony Hooper, Amgen's head of global commercial operations, said AMG-145 would compete in a market estimated to be 17 million high-risk patients.
Amgen shares were off 96 cents, or 1.1 percent, at $85.63 on Nasdaq, on a generally down day for the broader market.
(Additional reporting by Deena Beasley in Los Angeles; Editing by Gerald E. McCormick, Chizu Nomiyama, Matthew Lewis and Dale Hudson)