Citi: Diversified business growth of Amgen (AMGN.US) offsets decline in Enbrel revenue; future outlook depends on execution of R&D pipeline

According to Zhitong Finance APP, after the US stock market closed on Tuesday, November 3, Amgen (AMGN.US) announced its third quarter 2026 results. The financial report shows that third-quarter revenue reached $10.365 billion, an 8% year-on-year increase, exceeding market expectations of around $10.05–10.07 billion. In terms of profitability, non-GAAP earnings per share were $6.45, a 14% year-on-year increase, beating expectations of $5.77–5.79; non-GAAP operating margin was 47.3%, up 0.2 percentage points year-on-year; free cash flow was $3.7 billion (compared to $4.2 billion in the same period last year).

Product sales for the quarter reached $9.883 billion, an 8% year-on-year increase. The six key growth products collectively grew 27% year-on-year and accounted for over 70% of product sales. Repatha, EVENITY, TEZSPIRE, UPLIZNA, BLINCYTO, and IMDELLTRA all achieved double-digit growth, with a total of 17 products reaching an annualized third-quarter sales scale of over $1 billion.

In its post-earnings research report, Citi pointed out that Repatha (sales of $1.1 billion; exceeded expectations by $46 million; up 37% year-on-year) remains the most significant highlight, benefiting from continued penetration in cardiology and primary care. At the same time, Evenity (sales of $751 million; exceeded expectations by $24 million), Uplizna (sales of $451 million; exceeded expectations by $71 million), and Imdelltra (sales of $406 million; exceeded expectations by $79 million) also provided additional growth momentum for the company. Tepezza (sales of $526 million; $66 million below expectations; down 6% year-on-year) was adversely affected by inventory liquidation. Prolia (sales of $632 million; $48 million below expectations) and Xgeva (sales of $288 million; $39 million below expectations) continued to see revenue declines after biosimilars entered the market, with sales and net prices both dropping (year-on-year drops of 45% and 47%, respectively). However, the diversification of the company's product portfolio remains sufficient to absorb short-term pressures.

Amgen also raised its full-year 2026 guidance, with total revenue expectations raised to $38.9–39.7 billion (previously $38.2–39.4 billion) and non-GAAP EPS guidance raised to $22.90–23.70 (previously $22.30–23.50).

Citi believes that Amgen's upward revision of its full-year guidance further boosts market confidence in its commercial execution, but its medium- to long-term valuation increasingly depends on whether its R&D pipeline can meet expectations. In fact, although Repatha, the oncology business, and the rare disease business have strong momentum, the uncertainty related to Lp(a) and the data gap before MariTide phase III clinical readout keep the bank cautious. Citi maintains a "Neutral" rating on Amgen, with a target price of $405.

Citi notes: 1) the diversification of the product portfolio continues to absorb the impact of the decline in revenue from denosumab products, with Repatha and the rare disease business as primary growth drivers. 2) The core growth engines remain solid, as Repatha, Evenity, Tezspire, Uplizna, Blincyto, and Imdelltra all delivered strong sales performance. 3) Compared to quarterly performance, dazodalibep, olpasiran, and MariTide are more crucial in influencing the company's future valuation multiples.

It is reported that Amgen announced three positive Phase III results in the third quarter. Dazodalibep met the primary endpoint in the Phase III OASIS-301 study in systemic Sjögren's syndrome, with the monthly dosing group showing a 5.6-point improvement from baseline and the quarterly dosing group improving 5.2 points (placebo-corrected increases of 1.8 and 1.4 points respectively), and achieved key secondary endpoints such as patient-reported dry mouth. The second Phase III study in symptomatic patients is expected to read out within the year, and management emphasized that the two populations were enrolled separately, making it "difficult to extrapolate directly from study 301 to study 303." TEZSPIRE achieved both histological remission and swallowing symptom co-primary endpoints in its eosinophilic esophagitis Phase III trial, with efficacy maintained for up to 52 weeks. Daxdilimab achieved the primary endpoint in both dosing groups in the Phase II study for discoid lupus erythematosus and will advance to Phase III. In the weight-loss field, the MARITIDE III project completed enrollment for two sleep apnea studies and cardiovascular outcomes studies this quarter, as well as the first of three Phase III studies in type 2 diabetes. The company claims MariTide may become the first weight-loss therapy requiring only monthly dosing, with just 4–6 injections per year, and is currently conducting studies on an at-home autoinjector pen.