AMAG Pharmaceuticals Inc.'s
) third quarter 2012 loss of 16 cents per share was narrower than
the Zacks Consensus Estimate of a loss of 24 cents and the
year-ago loss of 78 cents per share. Lower operating expenses
resulted in a narrower loss.
Quarterly revenues climbed 1.1% to $17.4 million, below the
Zacks Consensus Estimate of $21 million. Bulk of the revenues in
the third quarter of 2012 came from Feraheme sales.
AMAG records revenues mainly from Feraheme, an injectable drug
for intravenous use as iron replacement therapy for the treatment
of iron deficiency anemia (IDA) in adults suffering from chronic
kidney disease (CKD).
In the reported quarter, net sales of Feraheme amounted to
$16.2 million, up 2.4% from the year-ago quarter.
AMAG has a partnership agreement with
) for Feraheme, in the EU and Canada. We note that Rienso (EU
trade name of Feraheme) was launched recently in the EU while it
was launched in Canada in October this year. AMAG already
received $3 million as milestone payment for the Canadian launch
of the drug and is anticipating a $15 million milestone payment
from Takeda for the European sale of the drug.
AMAG is working on expanding Feraheme's label. The company is
conducting two studies conducted in patients with IDA regardless
of the underlying cause. AMAG reported positive results from the
second phase III clinical trial during the third quarter of 2012.
AMAG intends to submit a supplemental new drug application (sNDA)
to the US Food and Drug Administration (FDA) for this indication
by year end.
Total operating cost (including cost of goods sold) in the
quarter amounted to $22.3 million, down 35.9% from the year-ago
period. Lower research and development (R&D) expenses related
to the company's global IDA clinical program helped reduce
operating expenses. Both R&D expenses and selling, general
and administrative (SG&A) expenses were on the downtrend in
the reported quarter.
Feraheme Outlook Raised
AMAG updated its guidance for 2012. Feraheme sales are now
expected in the range of $58-$60 million for 2012 (old guidance:
$55-$58 million). Further, AMAG has lowered its total operating
expenses (excluding cost of goods sold) guidance to the range of
$87-$90 million (old guidance: $90 - $95 million).
The company still expects to exit 2012 with cash and
investments of $225-$230 million. The guidance excludes the
impact of a business development transaction. AMAG also expects
to receive milestone payments totaling $33 million pertaining to
regulatory approvals and commercial launches of Rienso in the EU
and Canada. Of this $33 million AMAG has already received $18
We currently have an Outperform recommendation on AMAG. The
stock carries a Zacks #3 Rank (short-term Hold rating). We expect
investor focus to remain on Feraheme's performance and the
company's efforts to expand the product's label.
AMAG PHARMA INC (AMAG): Free Stock Analysis
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