AMAG Pharmaceuticals Inc.
) first quarter 2013 loss of 19 cents per share was narrower than
the year-ago loss of 58 cents and the Zacks Consensus Estimate of
a loss of 20 cents per share. Higher revenues and lower expenses
resulted in the narrower loss.
Revenues during the reported quarter climbed 16% to $17.9
million, surpassing the Zacks Consensus Estimate of $17 million.
Revenues in the first quarter of 2013 benefited from higher
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 first quarter of 2013, US net sales of Feraheme amounted
to $15.6 million, up 14.3% year over year. The increase was
attributable primarily to volume growth.
AMAG has a partnership agreement with
) for Feraheme, in the EU and Canada. We note that Rienso (EU
trade name of Feraheme) was launched in the EU and Canada during
the fourth quarter of 2012.
AMAG is working on expanding Feraheme's label. In Dec 2012, the
company submitted a supplemental new drug application (sNDA) to
the US Food and Drug Administration (FDA) for Feraheme. AMAG is
looking to get Feraheme's label expanded for the treatment of CKD
adults suffering from IDA with a history of unsuccessful oral
iron therapy. The US regulatory body is expected to render a
final decision on the proposed label expansion by Oct 21, 2013.
Successful label expansion would boost the sales potential of the
drug in the US.
Total operating cost (including cost of goods sold) in the
quarter amounted to $22.4 million, down 24% from the year-ago
period. While research and development (R&D) expenses
declined 56.8%, selling, general and administrative (SG&A)
expenses climbed up 6.3% in the reported quarter.
Lower R&D expenses resulting from the completion of the
company's global IDA clinical program reduced operating expenses.
2013 Outlook Maintained
AMAG reiterated its previously announced guidance for 2013. The
company still expects to generate total revenues in the range of
$73-$77 million in 2013. The Zacks Consensus Estimate of $75
million is well within the company's guidance. The company
expects Feraheme US sales to be within $63 million and $67
AMAG also expects to generate around $10 million from royalties,
product sales related to ex-US sales of Feraheme/Rienso and
The company expects to incur operating expenses of around $78-$82
million in 2013. AMAG expects to exit 2013 with cash and
investments in the range of $206-$211 million.
We believe that the company's guidance for 2013 is achievable. We
expect investor focus to remain on Feraheme's performance and the
company's efforts to expand the product's label.
AMAG currently carries a Zacks Rank #3 (Hold). Meanwhile, other
stocks such as
Transcept Pharmaceuticals Inc.
Catalyst Pharmaceutical Partners Inc.
) currently look more attractive in the pharma space carrying a
Zacks Rank #1 (Strong Buy).
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