Amgen Inc.
(NDAQ:AMGN) shares dropped $0.79, or 1.55%, today after the company
announced that it is weighing its cost cutting options designed to
counteract the declining sales of its best-selling amnesia drug. The
biotech company is consider, among other things, slowing its research
and development programs, tighten capital projects, and a rumored
layoff of 20,000 employees. Shareholders are hoping that such efforts
can help the company turn itself around and jump the share price.
Amgen
saw sales of its top-selling Aranesp amnesia drug drop 19% to $578
million in the second quarter from $713 million a year earlier. The
company said it was taking action, however, to restore Amgen by
adjusting their cost basis to be more in line with revenue growth,
seeking efficiencies, and making "tough-minded" choices. Through
trimming the growth of operating expenses and suspending some of its
capital projects, the company hopes to improve.
In the end, if
the company is able to reduce its operating expenses and jump its
earnings per share enough to compensate for poor sales, it could mean
significant share appreciation for shareholders. This makes AMGN a
stock
worth watching!
Related CompaniesBiogen Idec Inc. (BIIB)Genetech Inc. (DNA)Johnson & Johnson Co. (JNJ)