Amgen’s (AMGN) existing oncology blockbuster drugs, Neupogen and Neulasta, are facing the threat of competition from biosimilars, or generic biotech drugs. To protect its profit margins, Amgen has introduced Kyprolis and Blincyto in the US market.
The above graph shows the distribution of multiple myeloma, or MM, patients across various lines of treatment. It shows that drugs approved for newly diagnosed patients have a larger target audience than that of drugs approved for relapsed patients.
To reduce its exposure with Neupogen and Neulasta, Amgen added Kyprolis to its drug portfolio through the acquisition of Onyx Pharmaceuticals. Approved in 2012 as the third line of treatment for MM, the drug was a direct competitor for Celgene’s Pomalyst. According to WebMd, “Multiple myeloma is a cancer that affects plasma cells, a kind of white blood cell found in the soft insides of your bones, called marrow.”
New approval as second line treatment
According to EvaluatePharma, the global MM market is expected to double from $6.5 billion in 2013 to $13.5 billion in 2020. Additionally, as new therapies are extending survival, the duration of the therapy as well as the lines of treatment are also on the rise. Based on results from the phase III trial ASPIRE, the FDA approved Kyprolis in July 2015 as the second line of treatment for the treatment of multiple myeloma patients.
ASPIRE shows that unlike previous second line therapies treating patients for eight months, Kyprolis has to be administered for 18 months to MM patients. The second line drug approval has also enabled Kyprolis to target a larger share of the MM market, currently dominated by Celgene’s (CELG) Revlimid, Novartis’s (NVS) Farydak, and Takeda and Johnson & Johnson’s (JNJ) Velcade.
Investors can get diversified exposure to Amgen’s new MM drug, Kyprolis, yet avoid unique company risks, by investing in the iShares NASDAQ Biotechnology ETF (IBB). IBB holds 8.53% of its total holdings in Amgen.