AMAG Q4 Earnings & Revenues Up Y/Y, Gives 2016 Outlook

AMAG Pharmaceuticals, Inc. AMAG reported earnings of $1.12 per share in the fourth quarter of 2015, up from 33 cents in the year-ago quarter. Adjusted earnings came in at 20 cents per share and missed the Zacks Consensus Estimate of earnings of 42 cents.

AMAG’s quarterly revenues of $108.7 million shot up 103.9% from the year-ago period. Adjusted revenues were recorded at $120.6 million, which included deferred revenue from purchase accounting. The Zacks Consensus Estimate was of revenues of $119 million.

For 2015, total revenue surged a whopping 236.4% to $418.3 million from 2014, primarily driven by the inclusion of Makena and Cord Blood Registry (CBR) in the company’s portfolio. Reported revenues barely beat the Zacks Consensus Estimate of $418.

Quarter in Detail

Makena sales came in at $67.4 million, up 199.6% year over year. The increase was primarily driven by a rise in the number of patients being treated with the drug.

Combined Feraheme and MuGard sales amounted to $23.5 million, down 4.1%.

During the reported quarter, the company reported CBR revenues of $17 million.
Research and development (R&D) expenses were $7.9 million, up 1.3%.

Selling, general and administrative (SG&A) expenses shot up 82.9% from the year-ago quarter to $50.3 million.

2016 Outlook

AMAG provided its financial guidance for 2016. The company projects total revenue in the range of $520 million to $570 million. The Zacks Consensus Estimate is of revenues of $546 million.

Makena sales are expected in the range of $310 million to $340 million, while combined Feraheme and MuGard sales are anticipated to be $95 million – $105 million.

CBR revenues are expected in the range of $115 million to $125 million.

Pipeline Update

AMAG plans to initiate a head-to-head phase III study on adult patients with iron deficiency anemia, who have failed or cannot tolerate oral iron treatment, in the first quarter of 2016. The company expects to present data from the study in 2017. It also expects an approval from the FDA in 2018, followed by its launch in the same year.

Moreover, the company anticipates an approval of its manufacturing supplement of a single-dose preservative-free formulation of Makena in the first quarter of 2016.

In addition, AMAG, in partnership with Antares Pharma Inc. ATRS, is developing a device for the subcutaneous administration of Makena by an auto-injector. The company expects to complete chemistry, manufacturing and controls, and pilot pharmacokinetics work, which will support the initiation of a bio-equivalence study by 2016-end.

Our Take

AMAG’s fourth-quarter 2015 results were disappointing, with the company missing both top-line and bottom-line expectations. Nevertheless, we expect investors to focus on the company’s consistent efforts to expand its maternal health portfolio.

AMAG currently carries a Zacks Rank #3 (Hold). A couple of better-ranked stocks in the health care sector include Anika Therapeutics Inc. ANIK and Horizon Pharma plc HZNP, both sporting a Zacks Rank #1 (Strong Buy).

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