In pre-market trading on Friday, there was a notable surge in the shares of U.S. drugmaker Amgen, with a significant 13% jump to $316.26. This surge was prompted by the company’s teasing of encouraging data for its experimental obesity drug, MariTide. While this news sparked optimism among investors, it also left some on Wall Street frustrated due to the lack of detailed information provided.
Amgen, currently conducting mid-stage studies of its injectable drug MariTide, expressed confidence in its differentiated profile and its potential to address important unmet medical needs. The company anticipates releasing data from the Phase 2 trial later this year and is already planning a comprehensive Phase 3 program across multiple indications, including diabetes.
Despite a slight dip in the company’s first-quarter adjusted profit and slightly lower-than-expected sales of certain drugs like Enbrel and Otezla for arthritis and psoriasis treatment, respectively, investors remained focused on the prospects of MariTide. Analysts like Christopher Raymond from Piper Sandler underscored the significance of the MariTide update, emphasizing the need for more clarity regarding the drug’s differentiation from existing GLP-1s.
Although Amgen’s commentary on investing in manufacturing capacity for clinical and commercial supply was seen as encouraging, the lack of specific details about MariTide’s differentiation left some analysts cautious. As a result, brokerage RBC reduced its price target on Amgen’s stock by $4 to $332 following the announcement.
MariTide, administered via injection, combines a compound aimed at activating the GLP-1 hormone, which induces a feeling of fullness, with an antibody that blocks the activity of another gut hormone called GIP, associated with metabolic regulation.
Despite the recent surge, Amgen’s stock performance over the past 12 months has been relatively subdued compared to leading companies in the weight-loss market like Eli Lilly and Novo Nordisk. However, with a forward price-to-earnings ratio of 13.9, Amgen’s stock appears relatively undervalued compared to its peers. Investors will likely continue to monitor developments related to MariTide and other key initiatives by Amgen in the coming months.