Amgen Acquires KAI - Analyst Blog

By Zacks Equity Research,

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Amgen ( AMGN ) recently completed its acquisition of privately held pharma company, KAI Pharmaceuticals. With this acquisition, which was first announced in April 2012, Amgen has gained global rights (excluding Japan) to KAI-4169.

At the time of announcing the deal, Amgen had said that it would make a cash payment of $315 million and loan an undisclosed amount to support KAI Pharmaceuticals' phase III development plans for KAI-4169.


KAI-4169 is being evaluated for the treatment of secondary hyperparathyroidism (SHPT) in chronic kidney disease (CKD) patients on dialysis. SHPT is a common and serious complication for the above patient population.

KAI Pharmaceuticals has already presented encouraging phase IIa data on the candidate. Patients in the KAI-4169 arm experienced a sustained reduction in parathyroid hormone (PTH), phosphorus, calcium and FGF-23. KAI-4169 was found to be well tolerated with adverse events including nausea, headache, anxiety and vomiting. While there were no discontinuations due to adverse events, the incidence of gastrointestinal adverse events was similar in both the KAI-4169 and placebo arms.

KAI Pharmaceuticals has a partnership with Ono Pharmaceutical Co., Ltd. for the development and commercialization of KAI-4169 in Japan. KAI-4169 may also have the potential to be used in pre-hemodialysis applications.

Our Take

We note that Amgen already has a presence in the CKD market in the form of Sensipar (EU trade name: Mimpara). Sensipar, approved for the treatment of CKD patients on dialysis who suffer from SHPT, posted sales of $808 million in 2011. By developing KAI-4169, Amgen is most likely looking to maintain its share in this market once Sensipar loses patent protection. KAI-4169 could represent a different and convenient treatment option for patients as it is being developed as an intravenous (IV) formulation that will be administered at the time of dialysis while Sensipar is a tablet.

Amgen has been pretty active on the deal making front. Major deals include a collaboration agreement with AstraZeneca ( AZN ) for the joint development and commercialization of five monoclonal antibodies in Amgen's pipeline and the acquisition of biotech company, Micromet, Inc.

We currently have a Neutral recommendation on Amgen, which carries a Zacks #3 Rank (short-term 'Hold' rating).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

This article appears in: Investing , Business , Stocks
Referenced Stocks: AMGN , AZN , PTH

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