Amgen upgraded at RBC on catalyst setup and growth drivers

RBC Capital Markets upgraded Amgen (NASDAQ:AMGN) to Outperform from Sector Perform on Tuesday, arguing that the pharma giant deserves additional recognition over its 2024 catalyst path and better visibility to its long-term growth drivers.

Analyst Gregory Renza notes that concerns about Amgen's (AMGN) revenue attrition due to upcoming key patent expiries have increasingly become less of a problem given its recent acquisition of Horizon Pharma, catalyst momentum, and other factors.

"We see 2024 as the year for greater visibility on AMGN's pipeline strength, and with recent evidence of execution, we see the reward-risk profile as skewed positively, RBC wrote, raising its price target on AMGN to $300 from $256 per share.

RBC points to the California-based pharma giant's obesity candidate, mari-tide, formerly known as AMG-133. The company has completed enrollments in a Phase 2 trial for the GIPR antagonist/GLP-1 receptor agonist, expecting topline data in H2 2024.

"We expect ph.II data to include a longer followup (to week 52), which would provide a more complete picture on maritide's competitiveness relative to incumbent GLP-1(s)," Renza wrote, referring to competing products from Novo Nordisk (NVO) and Eli Lilly (LLY).

Noting the company's established business lines, especially in relation to cholesterol therapy, Repatha, and biosimilars, the firm doesn't expect Amgen (AMGN) to face a revenue drop despite upcoming patent expiries for key products.