Amgen Earnings Call Highlights Growth Engines, Tax Risk

Amgen Inc ((AMGN)) has held its Q1 earnings call. Read on for the main highlights of the call.

Amgen’s latest earnings call struck a cautiously upbeat tone, with management emphasizing solid commercial momentum, upgraded guidance and a strengthening late‑stage pipeline despite visible headwinds. Modest 4% overall sales growth was powered by high‑growth franchises, while cash generation and AI‑enabled R&D gains helped offset pressure from legacy products, rising costs and unresolved tax disputes.

Growth Engines Now Dominate the Portfolio

Six key growth drivers generated roughly 70% of Amgen’s product sales in the first quarter and grew 24% year over year, effectively cushioning the blow from drugs facing loss of exclusivity. Management framed this mix shift as a structural advantage, arguing that diversified, durable franchises are increasingly anchoring revenue as older products decline.

Broad-Based Product Strength Supports Top Line

Total product sales increased 4% compared with the prior year, underpinned by breadth rather than dependence on any single blockbuster. Sixteen products posted double‑digit growth, and 17 are now annualizing above $1 billion in sales, giving Amgen a wide base of scale products to weather competitive and pricing pressures.

Repatha Surges on Strong Outcomes Data

Repatha stood out with first‑quarter sales of $876 million, up 34% year over year, benefiting from both volume gains and growing physician confidence. New VESALIUS‑CV subgroup data showed a 31% reduction in major cardiovascular events in high‑risk diabetes patients and nominal mortality reductions, bolstering the drug’s clinical and commercial narrative.

Evenity Lifts Bone Franchise Amid Legacy Declines

Evenity delivered 27% year‑over‑year sales growth to $562 million, including 35% growth in the U.S., where it now holds about 65% of the bone‑builder market. With roughly 320,000 U.S. patients treated and strong uptake in Japan, management highlighted Evenity as a key offset to steep erosion in older osteoporosis brands.

Rare Disease and Specialty Assets Accelerate

Amgen’s rare disease portfolio grew 25% to $1.2 billion, reflecting momentum in high‑value specialty therapies. Eplisna sales nearly tripled to $262 million, while TEPEZZA’s U.S. sales rose 29% to $490 million, supported by more than 25,000 patients treated and encouraging Phase III data for an on‑body injector enabling subcutaneous dosing.

Oncology and Biosimilars Deliver Double-Digit Gains

The innovative oncology portfolio posted 25% growth to $1.8 billion, with Imdeltra contributing $258 million and Blincyto advancing 12% to $415 million despite trial pauses in other indications. Biosimilars also remained a growth pillar, with sales up 14% to $835 million, including $280 million from PABLUE in the quarter.

Financial Strength Underpins Upgraded Outlook

Non‑GAAP operating margin came in at 45%, reflecting disciplined cost control alongside stepped‑up investment. Amgen generated $1.5 billion of free cash flow in the quarter and used its balance sheet flexibility to raise 2026 revenue guidance to $37.1–$38.5 billion and non‑GAAP EPS guidance to $21.70–$23.10.

Stepping Up R&D and Manufacturing Investment

Non‑GAAP R&D spending climbed 16% year over year as Amgen leaned into late‑stage assets like Meritide, Imdeltra and olpasiran. Capital expenditures reached $700 million in the quarter, with roughly $2.6 billion planned for the year to expand manufacturing capacity, including preparations for a potential Meritide launch.

Pipeline Advances in Meritide and Olpasiran

Meritide is advancing through multiple Phase III trials, including switch and long‑term maintenance studies that test every 8‑ and 12‑week dosing and a three‑step dose escalation aimed at improving gastrointestinal tolerability. Olpasiran continues in Phase III with more than 95% reductions in Lp(a) and the launch of the OCEANA CCTA study, reinforcing its cardiovascular risk‑reduction potential.

AI Efficiencies Boost R&D and Operations

Management spotlighted emerging benefits from AI initiatives, which have roughly halved antibody lead‑optimization timelines and, in some instances, tripled clinical site enrollment rates. AI tools have also reduced production line clearance time from about 30 minutes to roughly 2 minutes per batch and started to streamline regulatory documentation work.

Legacy Bone Brands Face Sharp Erosion

Loss of exclusivity is hitting legacy osteoporosis products hard, with combined Prolia and XGEVA sales down 32% to $1.1 billion in the quarter. Amgen warned investors to expect accelerated erosion through 2026 as multiple biosimilars enter the market, reinforcing the urgency of scaling newer growth drivers.

Cost of Sales and Margin Pressures Build

Non‑GAAP cost of sales rose to 19.5% of product sales, driven by higher profit‑share and royalty obligations plus an evolving product mix. Management does not expect these pressures to ease near term and signaled that cost of sales will remain a headwind for margins even as overall profitability stays robust.

Regulatory and Clinical Setbacks Temper Optimism

The FDA has proposed withdrawing approval for Tabneos, adding to regulatory friction around parts of the portfolio. Separately, enrollment for blinatumomab subcutaneous and SLE trials has been paused over inflammatory events under FDA review, and Amgen has discontinued development of AMG 193, underscoring the inherent risk in its pipeline.

IRS Audit Clouds the Tax Outlook

Amgen disclosed receipt of a draft IRS Notice of Proposed Adjustment for 2016–2018 that challenges profit allocations between the U.S. and Puerto Rico and could be material if fully sustained. This comes on top of unresolved tax litigation for 2010–2015, injecting additional uncertainty into the company’s long‑term effective tax rate.

Higher OI&E Expense and Funding Dynamics

Non‑GAAP other income and expense totaled $480 million of expense in the first quarter, even after a roughly $90 million gain linked to debt repurchases. For the full year, Amgen expects $2.2–$2.3 billion of non‑GAAP OI&E expense, reflecting the cost of its capital structure as it continues investing heavily in growth initiatives.

Repatha Cash-Pay Channel Still Nascent

The Amgen Now cash‑pay program for Repatha is drawing interest, with roughly 8,000–9,000 patients moving through the channel. However, management stressed that this remains a small portion of Repatha’s volume and is not yet a meaningful driver of overall growth, serving more as an access pilot than a core strategy.

Guidance and Outlook Emphasize Durable Growth

Amgen’s guidance calls for 2026 revenue of $37.1–$38.5 billion and non‑GAAP EPS of $21.70–$23.10, assuming a 15.0–16.5% non‑GAAP tax rate and a roughly 45–46% operating margin. The company expects other revenue of $1.7–$1.8 billion, non‑GAAP OI&E expense of $2.2–$2.3 billion, capex around $2.6 billion and share repurchases capped at $3 billion, with second‑quarter margins roughly in line with the first.

Amgen’s earnings call painted the picture of a company successfully pivoting from aging blockbusters to a new generation of specialty and oncology assets while leaning on AI and heavy investment to sustain its edge. For investors, the upgraded guidance, strong free cash flow and visible pipeline milestones offer support, even as tax disputes, regulatory risks and cost pressures demand continued vigilance.