Amgen (AMGN) reported financial results for the second quarter 2009 on Jul 27, 2009. Revenues totaled $3,713 million, down 1% from the second quarter in 2008, but far ahead of our expectations by approximately $150 million. The revenue upside was driven by strong sales of key products: Aranesp at $693 million, nearly $50 million above expectations, and Enbrel at $899 million, nearly $70 million above expectations. Other products - including Epogen at $638 million, Neupogen at $327 million, and Neulasta at $831 million - were in-line with expectations.

Sales of the company's two ESA (Erythropoiesis-Stimulating Agent) products, Aranesp and Epogen, declined by 8% from the second quarter 2009, reflecting the negative impact, primarily in the supportive cancer care setting, of additional product label changes that occurred in August 2008. However, market share stabilization and modest pricing strength lead to the upside to our forecasts. Sales of Enbrel increased 7%

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The pharmaceutical industry is entering a period of substantial change in 2009. Most of the names in the industry are facing significant patent challenges in the years to come. U.S.-based firms are facing foreign exchange headwinds, as well. Revenue growth is non-existent, and earnings growth is being driven primarily by mergers, cost-cutting and share buybacks. Knowing that investors rarely pay-up for this type of manufactured earnings growth, we struggle to see a broad-based out-performance for the large-cap pharmaceutical sector in 2009.Valuations, however, are attractive, with several of the largest players trading at PEs below 10x, including: Pfizer (PFE, 7.5x), Eli Lilly (LLY, 8.1x), Merck (MRK, 8.3x), Sanofi (SNY, 7.5x), AstraZeneca (AZN, 7.6x) and GlaxoSmithKline (gsk, 9.3x) based on our fiscal 2009 estimates. Attractive valuations, along with big dividend yields, should protect investors against significant downside risk even if the economy continues ...

For Immediate Release

Chicago, IL - April 27, 2009 - Zacks Equity Research picks Teva Pharmaceuticals (TEVA) as Bull of the Day and Amgen, Inc. (AMGN) as Bear of the Day. In addition, the analysts at Zacks Equity Research discuss the latest on Wells Fargo (WFC), US Bancorp (USB) and SunTrust (STI).

Full analysis of all these stocks is available at: http://at.zacks.com/?id=2678

Bull of the Day

We are initiating coverage on Teva Pharmaceuticals (TEVA) with a Buy rating and a price target of $52. We are impressed with the company's strong performance in 2008 despite the global slowdown and are optimistic on growth prospects.

We expect Teva to continue posting strong revenues and earnings going forward thanks to new product launches, both generic and branded. We are also pleased to see Teva's progress with its branded and biogenerics pipeline. Biogenerics should help drive growth in the long-term.

Meanwhile, the

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Results over the past few quarters demonstrate the challenging environment for Amgen, Inc. (AMGN) specifically with its key products, Aranesp and Enbrel. Management believes that the first quarter represents a trough with respect to product sales.

We struggle to see what re-accelerates Amgen's top-line in the second half of the year. Management's revenue guidance of $14.4 to $14.8 billion looks high to us, and seems to include significant inventory stocking on key product and/or a big upfront licensing deal for denosumab. We are hesitant to model either.

Amgen should be able to meet its EPS target of between $4.55 and $4.75, but with the top-line most likely staying weak, we struggle to see how the stock moves higher. We are advising investors to exit the stock. Our target is $40. Zacks Investment Research

Obama's Healthcare Plan Is Big Bark, Small Bite by Jason Napodano, CFA

When President Obama's administration released the proposed budget for the upcoming fiscal year, drug stocks quickly dropped. Fears of socialized medicine, or "Hillary-Care 2.0" turned investors away from the sector.

Was the drop warranted?

There are 6 key components to healthcare reform that could have a meaningful impact on pharmaceutical and biotechnology companies in the near future.Four of these are potentially negative, whereas the other 2 are potentially positive.

First Potential Negative: Increasing Pricing Rebates

The new proposal calls for an increase in Medicaid rebates from the current level of 15% to 21%. This equates to a 6% decrease in pricing power by all the companies in our universe into the Medicaid market. If we delve deeper into the ramification of this

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For Immediate Release

Chicago, IL - March 27, 2009 - Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Cognizant Technology Solutions Corp. (CTSH), Infosys Technologies, Ltd. (INFY), Wipro Ltd. (WIT), Amgen, Inc. (AMGN) and AK Steel (AKS).

Get the most recent insight from Zacks Equity Research with the free Profit from the Pros newsletter: http://at.zacks.com/?id=4579.

Here are highlights from Thursday's Analyst Blog:

Cognizant Sails in Choppy Waters

Recent outlook for companies in the IT Services sector has not been positive, and the sentiment has been supported by datapoints through CY2009. However, companies like Cognizant Technology Solutions Corp. (CTSH), Infosys Technologies, Ltd. (

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Amgen, Inc. (AMGN), a global biotechnology company, is focused on the development and commercialization of human therapeutics. The company's key products are Epogen/Aranesp (anemia), Neupogen/Neulasta (neutropenia), and Enbrel (inflammatory disease). Results over the past few quarters demonstrate the challenging, but stabilizing ESA market.Nevertheless, we still feel as though the pipeline is significantly undervalued, and we continue to recommend the name as a long-term Hold within the biotechnology sector. Recent positive news on phase III denosumab is a big reason we continue to be positive on Amgen. Our price target is $56.Based on our 2009 through 2013 model, the 5-year earnings CAGR [compound annual growth rate] of 7% is generally in-line with that of most large-cap pharmaceutical companies. Yet it is well below some of the larger biotechnology peers such as Genentech (DNA), Biogen (BIIB), Celgene  (CELG), Genzyme (GENZ) and Gilead ...

Highlighted companies include Genentech, inc. (DNA), Amgen, Inc. (AMGN) and Wyeth (WYE).Waxman's Bill Bad for Biotech Companies (and Doctors, Patients and America)California Representative Henry Waxman (D-CA), Chairman of the House Energy and Commerce Committee, has proposed legislation, along with his colleagues, that would give the U.S. Food and Drug Administration (FDA) the authority to approve generic (bioequivalent) versions of biotech drugs. As of now, there exists no path to approval for so called follow-on biologics as there is with small-molecule pharmaceutical products.According to the Wall Street Journal, the main contention on the bill remains how many years of market exclusivity a product would receive after approval. Mr. Waxman is calling for 5 years, whereas the biotech companies and trade organizations are asking for 14 years.This is a serious issue for investors in biotechnology stocks, in our view. Allowing ...

Amgen, Inc. (AMGN), a global biotechnology company, is focused on the development and commercialization of human therapeutics. The company's key products are Epogen/Aranesp (anemia), Neupogen/Neulasta (neutropenia), and Enbrel (inflammatory disease).Results over the past few quarters demonstrate the challenging, but stabilizing ESA [erythropoiesis stimulating agents] market. Nevertheless, we still feel as though the pipeline is significantly undervalued, and we continue to recommend the name as a long-term hold within the biotechnology sector.Recent positive news on phase III denosumab is a big reason we continue to be positive on Amgen. Our price target is $62.Read the full analyst report on AMGN. "AMGN" Free Stock Analysis: Buy? Sell? Hold?Zacks Investment Research