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Amgen profit tops Street view, boosts full-year forecast

An Amgen sign is seen at the company's office in South San Francisco, California October 21, 2013. REUTERS/Robert Galbraith

By Bill Berkrot

(Reuters) - Amgen Inc (AMGN.O) on Thursday reported higher-than-expected second-quarter profit and revenue, helped by strong sales of its Enbrel rheumatoid arthritis drug and cost cutting, and the company raised its full-year forecasts.

Excluding special items, Amgen earned $2.57 per share, topping analysts' average expectations by 14 cents, according to Thomson Reuters I/B/E/S.

The strong second-quarter performance led the world's largest biotechnology company to boost 2015 profit and revenue expectations. Amgen now sees adjusted earnings of $9.55 to $9.80 per share, up from its prior view of $9.35 to $9.65. It sees revenue coming in between $21.1 billion and $21.4 billion, up from $20.9 billion to $21.3 billion.

"The magnitude of the guidance raise was substantial," said Cowen and Co analyst Eric Schmidt. "The numbers are all very good." Amgen's shares rose 1.8 percent in extended trading.

The company is expecting U.S. approval of what could be its next big product, a potent new type of cholesterol fighter called Repatha, by late August. It won European approval earlier this month. Regeneron (REGN.O) and Sanofi (SASY.PA) gained U.S. approval of a similar medicine last week.

"We are on track to deliver on our long-term objectives for patients and shareholders," Chief Executive Robert Bradway said in a statement.

The company also named to its board industry veteran Fred Hassan, who has a long history of selling large companies, including Pharmacia and Schering-Plough.

"They are making headway with expense cuts," said Bernstein analyst Geoffrey Porges. "Now it's really all about the PCSK9 approval and launch," he said of Repatha.

Revenue for the quarter rose to $5.37 billion, exceeding Wall Street forecasts of $5.32 billion.

Unfavorable foreign exchange rates due to the strong dollar hurt revenue by 2.5 percentage points, the company said. Amgen gets about 22 percent of its sales from overseas.

Enbrel sales rose 8 percent to $1.36 billion, driven by price increases despite a highly competitive market. Analysts had been looking for about $1.25 billion.

Osteoporosis drug Prolia also topped expectations by about $30 million with sales of $340 million for the quarter.

Sales of the infection-fighting white blood cell boosters Neulasta and Neupogen, which are bracing for competition from new biosimilar versions, were in line with expectations at $1.41 billion.

Amgen has been working to cut costs. Research and development expense was down 6 percent and operating expenses fell 1 percent.

Net profit rose to $1.65 billion, or $2.15 per share, from $1.55 billion, or $2.01, a year ago.

(Additional reporting by Deena Beasley in Los Angeles; Editing by James Dalgleish)