Amgen, Inc. (NASDAQ:AMGN) announced a neuroscience collaboration with Novartis in the areas of Alzheimer’s disease and migraine. The collaboration acceleratesAmgen’s potential entry into Alzheimer’s disease by teaming up with Novartis on a differentiated and genetically validated Alzheimer’s disease program directed at genetically predisposed individuals at risk of developing Alzheimer’s disease. The collaboration also enables Amgen to focus on the commercialization of its migraine programs in the U.S., Canada and Japan, while leveraging Novartis’ strong commercial capabilities in neuroscience throughout Europe and other markets worldwide.
The agreement combines each company’s BACE (beta-site APP-cleaving enzyme-1) programs targeting Alzheimer’s disease into a global co-commercialization and co-development arrangement. Novartis’ Phase 1/2a BACE inhibitor (CNP520) will be the lead molecule and each company’s pre-clinical BACE inhibitor programs will be potential follow-ons. Amgen will make upfront and milestone payments, and will be responsible for disproportional research and development (R&D) costs for an agreed-upon period followed by a 50/50 cost and profit share arrangement. CNP520 is planned to be included in a pioneering prevention study, in collaboration with the Banner Alzheimer’s Institute. Amgen was the first company to clone the BACE gene and subsequent genetic validation of the BACE target has been confirmed by Amgen subsidiary deCODE Genetics.
As part of the collaboration, Novartis receives global co-development rights and commercial rights outside of the U.S., Canada and Japan to the investigative molecules in Amgen’s migraine portfolio program. This includes AMG 334 in Phase 3 and AMG 301 in Phase 1, as well as an option to commercialize an additional early-stage Amgen molecule in these territories. In exchange for territory rights,Novartis will fund disproportional amounts of global R&D expenses for an agreed-upon period on the migraine programs and pay Amgen double-digit royalties on sales.
“We are very pleased to be joining forces with Novartis on two important neuroscience programs where there remains high unmet medical need,” said Sean E. Harper, M.D., executive vice president of Research and Development atAmgen. “Our collaboration on BACE inhibition reflects Amgen’s strategic focus on genetically validated drug candidates while our collaboration in migraine creates an opportunity to more rapidly advance AMG 334 on a global scale.” (Original Source)
Shares of Amgen opened today at $147.46 . AMGN has a 1-year high of $181.81 and a 1-year low of $127.67. The stock’s 50-day moving average is $163.96 and its 200-day moving average is $159.78.
On the ratings front, Amgen has been the subject of a number of recent research reports. In a report issued on August 27, Piper Jaffray analyst Joshua Schimmer reiterated a Buy rating on AMGN, with a price target of $200, which represents a potential upside of 35.6% from where the stock is currently trading. Separately, on August 17, Deutsche Bank’s Robyn Karnauskas maintained a Buy rating on the stock and has a price target of $195.
According to TipRanks.com, which ranks over 7,500 financial analysts and bloggers to gauge the performance of their past recommendations, Joshua Schimmer and Robyn Karnauskas have a total average return of 2.2% and 11.2% respectively. Schimmer has a success rate of 42.5% and is ranked #1333 out of 3742 analysts, while Karnauskas has a success rate of 61.7% and is ranked #192.
The street is mostly Bullish on AMGN stock. Out of 10 analysts who cover the stock, 6 suggest a Buy rating and 4 recommend to Hold the stock. The 12-month average price target assigned to the stock is $178.90, which implies an upside of 21.3% from current levels.