Amgen Soars 17% on New Study

I recently lowered Amgen to a Hold in Portfolio Grader although the stock has been a member of my Blue Chip Growth Buy List since January. The stock is up strongly today after the company reported its lead experimental product, a bone strengthening medicine, worked better than a potential rival in a study.

According to the study, Amgen’s denosumab did better job in delaying fractures and other problems for breast cancer patients whose illness had spread to their bones than Novartis’ Zometa.

Analysts up and down Wall Street are very pleased with the results and are aggressively raising their sales estimates. Amgen’s stock has been up by as much as 17% today. This how Bloomberg describes denosumab:

Denosumab, a genetically engineered antibody, is designed to block the action of a protein called RANK Ligand, which leads to the breakdown of bones. Amgen has said it anticipates a decision from the U.S. Food and Drug Administration on whether it can sell denosumab for osteoporosis by Oct. 19. The drug would compete with cheaper copies of Merck & Co.’s Fosamax.

Amgen is also studying denosumab to see if it can prevent serious fractures and other damage that frequently occurs in patients with cancer that has spread to the bones.

The stock continues to be a Hold although I may upgrade it soon.

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