Earnings Call Transcript
AMGEN INC (AMGN)
Earnings Call Transcript - AMGN Q3 2022
Arvind Sood, Vice President of Investor Relations
Okay. Thank you, Jason. Good afternoon, everybody, and welcome to our Q3 call. So we continued with our execution during the quarter with a focus on driving volume growth for our key products and advancing our innovative pipeline. Leading the discussion today will be our Chairman and CEO, Bob Bradway. We have posted some slides for your reference and my customary reminder that we'll be making some forward-looking statements and use non-GAAP financial measures to describe our performance. So with that, I would like to turn the call over to Bob.
Bob Bradway, Chairman and CEO
Okay. Thank you, all of you, for joining our call. In the face of both macroeconomic and industry-specific challenges, Amgen remains laser-focused on delivering for patients and shareholders. Benefit of that focus was evident in the third quarter with volumes up a healthy 8% and 16% outside the United States. These results reflect the strong underlying demand for our medicines and the value they bring to patients even in challenging economic times like those prevailing at the moment. Revenues for the quarter were down 1%, reflecting a 5% net price decline consistent with what we communicated earlier in the year and a 2% impact from foreign exchange. All told, 11 of our products generated record sales in the quarter, and non-GAAP earnings per share increased 15% with free cash flows reaching $2.8 billion for the quarter. Looking forward, we remain focused on several growth drivers. With the recent closing of the ChemoCentryx acquisition, we're excited to have TAVNEOS in our portfolio. TAVNEOS is the first new treatment for ANCA-associated vasculitis in more than 10 years, and we're confident that we can leverage our decades of experience in inflammation and nephrology to bring this innovative medicine to many more patients moving forward. Two recently launched products, TEZSPIRE and LUMAKRAS, are off to solid starts. TEZSPIRE is performing well in asthma, and we have studies underway for several other indications for that product as well. LUMAKRAS is performing well globally with patients, payers, and prescribers recognizing the importance of this innovation. With combination studies underway, we're exploring the many different ways this product may benefit patients through time. We have a number of key products led by Repatha, Otezla, Prolia, and EVENITY that we know can benefit millions more patients globally than they do today. And let's not lose sight of the fact that these four products collectively generated $2 billion in third quarter sales with volume growth of 17%. We've built an industry-leading biosimilars business, having now launched five products in markets around the world, and we're months away from being the first company to launch a biosimilar to HUMIRA in the U.S. AMGEVITA is already the most prescribed HUMIRA biosimilar in Europe, giving us confidence as we prepare to enter the U.S. market. Looking forward, our next wave of biosimilars to STELARA, SOLIRIS, and EYLEA are well positioned with our having now successfully completed Phase III trials for all three of these molecules. We have many potential new medicines advancing through our innovative pipeline, including Olpasiran, tarlatamab, rocatinlimab, bemarituzumab, and AMG 133. These five molecules and several others that you'll hear about shortly from Dave Reese are vintage Amgen, which are first-in-class medicines that make a big difference for patients suffering from serious diseases for which there remains a real need for new and better treatments. Finally, we have a highly engaged and committed workforce, and I want to thank them, as always, for their great work. With that, let me turn over to our CFO, Peter Griffith.
Peter Griffith, CFO
Thank you, Bob. We're pleased with our execution this quarter, and we are on track to deliver against our long-term objectives, most importantly serving patients. Our recently closed acquisition of ChemoCentryx adds a newly launched innovative product to our portfolio, TAVNEOS, a first-in-class and best-in-class approved treatment for patients with ANCA-associated vasculitis. Let's walk through our third quarter financial results before discussing our 2022 guidance. The financial results are shown on Slide 6 of the slide deck. In Q3, we recognized total revenue of $6.7 billion. This represents a modest decline of 1% year-over-year. Excluding the impact of foreign currency, total revenue and product sales grew 2% and 1%, respectively. Earnings per share of $4.70 grew 15% versus our recast Q3 2021. Recall those results included $400 million recorded in R&D expense related to our upfront payment to license rights to AMG 451, rocatinlimab, from Kyowa Kirin Corporation, KKC. Non-GAAP EPS grew 1%, excluding the $400 million expense for the KKC license. Murdo will review product sales with you, but I would highlight that our established product portfolio generated almost $900 million in product sales and continues to deliver strong cash flows to fund both internal and external innovation. Other revenues of $415 million increased 8% year-over-year. Non-GAAP operating expenses decreased 8% year-over-year primarily driven by the $400 million payment to KKC in Q3 2021. Excluding the impact of the $400 million upfront payment, third quarter total non-GAAP operating expenses increased 4% year-over-year, reflecting investments to advance our research capabilities and pipeline while also supporting product launches. And we delivered a 52.5% operating margin as a percentage of product sales. On a non-GAAP basis, cost of sales as a percent of product sales increased 0.3 percentage points on a year-over-year basis to 16.1% primarily due to changes in product mix, partially offset by lower manufacturing costs and lower costs associated with fewer COVID-19 antibody shipments. Excluding the $400 million upfront payment, non-GAAP R&D spend in the third quarter increased 10% year-over-year primarily due to higher late-stage program support and research and early pipeline spend, partially offset by lower marketed product support. Non-GAAP SG&A expenses increased 1% year-over-year. We continue to focus on prioritizing key investments and activities while driving productivity, automation, and digitalization. Non-GAAP OI&E was about $370 million in expense in the third quarter. This was driven by increased net interest expense and our share of BeiGene results because of our use of the equity method of accounting. Our OI&E was lower than anticipated due to gains from liability management that we do not expect to the same extent in future quarters. We have a strong balance sheet, generate significant cash flow, and retain significant financial flexibility to execute strategic business development opportunities and execute on our multiple capital allocation priorities. In the third quarter, we executed on the following: first, our recent acquisition at ChemoCentryx is a clear example of investing in the best innovation, in this case, external for patients; second, investing in our business through capital expenditures, including advancing construction on our new environmentally friendly facilities in Ohio and North Carolina; third, returning capital to shareholders through growing dividends, including $1.94 per share in the quarter, representing a 10% increase from Q3 2021; and fourth, opportunistic share repurchases. The final settlement of the accelerated share repurchase, ASR program, occurred in the third quarter, and we have repurchased about $6.3 billion of shares year-to-date. Turning to the outlook for the business for 2022. We're pleased with our execution through the third quarter. For the full year, we now expect to absorb about $560 million in FX headwinds against product sales based on recent FX rates, of which we absorbed nearly $400 million through the third quarter. This is net of our hedging activities, reflecting our strong execution through the third quarter. And despite challenging foreign exchange dynamics, we're updating our 2022 revenue guidance range to $26.0 billion to $26.3 billion. We are updating our non-GAAP EPS range to $17.25 to $17.85. This range encompasses both FX headwinds of approximately 3% or $0.45 for the full year based on recent FX rates and costs associated with our acquisition of ChemoCentryx incurred between closing and year-end. I'll share a few additional points to consider for the remainder of 2022 with a particular focus on how these trends are likely to impact Q4. We expect FX headwinds to reduce product sales in Q4 by about $165 million. The U.S. government has agreed to purchase $290 million of Nplate. We will recognize about $200 million of those sales in Q4 with the remainder in 2023. We have completed the previously discussed divestiture of Gensenta, our generics business, in Turkey and will no longer recognize product sales and operating expenses from that business effective November 2, 2022. Sales of that business annualized at approximately $90 million. We now expect full year other revenue for 2022 between $1.5 billion to $1.6 billion versus our prior guidance of $1.4 billion to $1.6 billion. When comparing against our recast 2021 results, we continue to expect full year non-GAAP operating expenses to reflect a low double-digit decrease year-over-year. We continue to expect 2022 non-GAAP operating margin as a percentage of product sales to be roughly 50%. We continue to expect non-GAAP cost of sales in the range of 15.5% to 16.5% as a percentage of product sales. We now expect non-GAAP R&D expenses in 2022 to decrease 5% to 8% year-over-year compared to our recast 2021 non-GAAP R&D expenses, which include the $400 million upfront payment we discussed above. We expect non-GAAP SG&A spend to be roughly flat year-over-year as a percentage of product sales. We expect OI&E to be in the range of $1.6 billion to $1.7 billion with fourth quarter results closer to the first and second quarter results. For the full year, we now anticipate a non-GAAP tax rate range of 13.5% to 14.5%, down from our prior guidance of 14.0% to 15.0%. As you consider your modeling for 2023, recall that tax law changes enacted by Puerto Rico in June of 2022 that replaced the Puerto Rico excise tax, the PRET, in favor of an income tax will increase our 2023 income tax expense while reducing by roughly an equivalent amount of cost of goods sold. Note, however, there will be a one-time residual negative impact in 2023 related to the amount of the PRET currently capitalized in inventory that will be charged to cost of goods sold without a corresponding tax benefit. This charge is slightly larger than the benefit previously recognized with the implementation of the PRET in 2011, which was discussed in our 2011 Form 10-K. Summing up, since the business review in February, much has changed at the macro level with the strengthening of the U.S. dollar, persistently high inflation, higher interest rates, and the passing of the Inflation Reduction Act. Despite these headwinds, we have executed well in 2022. As we plan for 2023, we anticipate that these headwinds will continue. We're adapting our operating plans and expect to successfully execute against them. Like previous years, we expect to provide 2023 guidance on our Q4 earnings call in January. Our confidence in the long-term growth of Amgen remains strong. I thank our millions of patients for their courage and my 25,000 colleagues for their mission-driven work on behalf of those patients every day. This concludes the financial update. I'll turn it over to Murdo.
Murdo Gordon, Executive Vice President
Thanks, Peter. We saw strong volume growth in the third quarter with an 8% increase year-on-year. We delivered record quarterly sales for 11 products, including EVENITY, TEZSPIRE, AMGEVITA, Vectibix, KYPROLIS, Nplate, and BLINCYTO; and double-digit volume growth for several additional products, including Repatha and LUMAKRAS. Excluding the impact of foreign exchange, third quarter global product sales grew 1% as our volume increases were offset by a 5% decline in net selling price, consistent with our prior estimates. Including the 2% negative foreign exchange impact, product sales declined 1% year-over-year. I'll start now with our general medicine business, which includes Prolia, EVENITY, Repatha, and Aimovig. Overall revenue for this portfolio grew 14% year-over-year driven by 20% volume growth. In bone health, Prolia sales grew 7% year-over-year driven by 8% volume growth. EVENITY, which complements Prolia in our bone portfolio, had record sales of $201 million for the quarter driven by 45% volume growth in the U.S. and 30% volume growth outside of the U.S. Repatha sales increased 14% year-over-year driven by 52% volume growth, which was partially offset by lower net selling price. In the U.S., we generated 32% volume growth aided by broad adoption of Repatha by cardiologists and increasing adoption by primary care providers. We also saw declining net selling prices in the U.S. as we offered higher rebates to support broad Medicare Part D and commercial patient access. Looking ahead to 2023, we expect less year-over-year U.S. price erosion than we saw in 2022. Outside the U.S., sales of Repatha grew 26% driven by 73% volume growth. Net price declines outside the U.S. were primarily a result of Repatha's inclusion on China's National Reimbursement Drug List as of January 1, 2022. Overall, we remain focused on addressing the leading causes of morbidity and mortality by bringing Repatha to patients in need all around the world. Moving to our inflammation portfolio. Otezla sales increased 3% year-over-year for the quarter. Otezla saw 9% volume growth, partially offset by lower inventory and unfavorable foreign exchange impact. In the U.S., Otezla remains the leader in bio-naive psoriasis patient share, and we see broader adoption of Otezla among patients with mild-to-moderate psoriasis. Looking forward, we expect continued strong volume growth given Otezla's established safety profile, strong payer coverage, and unique position as the only systemic oral that can treat a broad spectrum of patients with psoriasis regardless of the severity of their disease. ENBREL sales decreased 14% year-over-year for the third quarter driven by lower net selling price, unfavorable changes to estimated sales deductions, and a 3% decline in volume. ENBREL remains an important product for patients due to its long track record of efficacy and safety. I'm very pleased with our strong U.S. launch of TEZSPIRE, which generated $55 million of sales in the third quarter. Allergists and pulmonologists have prescribed TEZSPIRE across a broad range of patients with severe uncontrolled asthma. We're also seeing initiation in both biologic-naive and previously treated patients. Physicians acknowledge TEZSPIRE's unique differentiated profile and its broad potential to treat the 2.5 million patients worldwide with severe asthma who are uncontrolled without requiring any phenotypic and biomarker testing. We recently completed our acquisition of ChemoCentryx, which adds TAVNEOS to our portfolio. TAVNEOS recently launched as a first-in-class treatment for ANCA-associated vasculitis, or AAV. This is a serious systemic autoimmune disease that leads to inflammation and eventual destruction of small blood vessels. This inflammatory disease can lead to permanent organ damage and, in some severe cases, can be life-threatening. TAVNEOS represents a significant advance in treatment for the 8,000 to 10,000 U.S. patients a year who develop severe active disease or experience major relapses of AAV. AAV is often managed by rheumatologists and nephrologists, where Amgen has a strong market presence and successful track record. We look forward to applying our deep expertise and inflammation experience to help many more patients manage AAV with TAVNEOS. Moving to our hematology and oncology business. Our six innovative products grew 8% year-over-year with 10% volume growth. For Vectibix and Nplate, strong volume growth in the quarter benefited from the timing of shipments to our partners in Japan. Our launch of LUMAKRAS is progressing well with revenues of $75 million in the third quarter. Quarter-over-quarter sales declined 3% driven by lower net selling price due to a $12 million unfavorable price adjustment resulting from our reimbursement approval in Germany. This was partially offset by 15% volume growth. In the U.S., LUMAKRAS has been prescribed to over 3,700 patients by over 2,200 clinicians in both academic and community settings. Outside the U.S., LUMAKRAS has now been approved in over 45 countries. We've launched in 30 markets and are rapidly pursuing reimbursement in the remaining markets. As we've noted before, near term, the market for LUMAKRAS is focused on the 7,000 U.S. and 20,000 ex-U.S. patients in the second-line setting. Longer term, we expect LUMAKRAS growth to come from earlier-line therapy and the potential of LUMAKRAS to treat other tumor types. Sales of our oncology biosimilars declined 25% year-over-year. While our biosimilars for MVASI and KANJINTI both hold leading shares, we expect continued net selling price deterioration and accelerating volume declines driven by increased competition. The most recently published average selling price for MVASI in the U.S. declined 37% year-over-year and for KANJINTI declined 38% year-over-year. Over time, we expect long-term growth in our biosimilars business to be driven by the addition of new molecules and additional launches. We're preparing ourselves for the upcoming launch of AMGEVITA, our HUMIRA biosimilar, in the U.S. in early 2023, followed by the next wave of biosimilar launches to STELARA, EYLEA, and SOLIRIS. Overall, I'm very pleased with our execution in the quarter. Our international presence and diverse portfolio of products positions us well to deliver on the execution of our long-term growth strategy. And with that, I'll turn it over to Dave.
David Reese, Executive Vice President, Research and Development
Thanks, Murdo, and good afternoon, everyone. I'd like to start by welcoming our new colleagues from ChemoCentryx. We're excited that you're now part of Amgen. For research and development, the third quarter was one of continued execution as we presented new data on several programs and continued to progress our innovative clinical pipeline. Beginning with general medicine. This coming weekend at the American Heart Association meeting, we plan to present data from a Phase II study of Olpasiran, a lipoprotein little a targeting small interfering RNA molecule in subjects with elevated Lp little a. We also plan to present additional data from the Repatha FOURIER and Repatha open-label extension studies highlighting the association between the significant and sustained achievement of low and very low LDL cholesterol levels and lower rates of major cardiovascular events. Data from the single- and multiple-dose cohorts of the Phase I study of AMG 133, a multispecific that inhibits the gastric inhibitory polypeptide receptor, or GIPR, and activates the GLP-1 receptor, will be presented at the 20th World Congress on Insulin Resistance, Diabetes and Cardiovascular Disease Hybrid Conference in December. As a reminder, the unique aspect of AMG 133 is the inhibition of GIPR, an innovative approach that we chose to take based on human genetic data that suggest decreased expression of GIPR leads to lower body mass index and lower weight. We look forward to discussing the Repatha and Olpasiran data along with an update on AMG 133 at our investor call scheduled for Monday, November 7. Turning to inflammation. In September, we presented data from the Phase III SPROUT trial, where Otezla treatment resulted in significant improvement in measures of moderate-to-severe plaque psoriasis at week 16 compared to placebo in children ages 6 to 17. We also presented data from the Otezla Phase III DISCRETE trial, where 16-week data demonstrated statistically significant improvements in genital psoriasis, including skin, itch, and quality of life in patients with moderate-to-severe disease. Based on these results, discussion with the FDA is ongoing for DISCRETE to add clinical data to the U.S. prescribing information, and discussions with regulatory authorities globally for SPROUT are forthcoming. In September, TEZSPIRE was approved in the European Union and Japan, and regulatory reviews continue in other jurisdictions. In oncology, we presented data from tarlatamab, a DLL3-targeting BiTE molecule being studied in patients with small cell lung cancer. These data demonstrated encouraging antitumor activity with notable response durability and survival. In this setting, tarlatamab delivered a confirmed overall response rate of 23%, a median duration of response of 13 months, and a median overall survival of 13.2 months. We continue to enroll patients in a potentially registrational Phase II study in this setting. We're also investigating tarlatamab in combination with standard of care in first-line small cell lung cancer, in combination with AMG 404, a PD-1 inhibitor, in patients with second-line or later small cell lung cancer, and in neuroendocrine prostate cancer. In August, we presented data from our LUMAKRAS checkpoint inhibitor and SHIP2 combination studies. Based on these data, we continue to explore LUMAKRAS in both settings. In September, we presented data on LUMAKRAS in combination with Vectibix, where this combination demonstrated encouraging efficacy and safety in patients with chemorefractory metastatic colorectal cancer. Phase III trial continues to enroll using this combination. We also presented data from the global Phase III CodeBreaK 200 confirmatory trial, where LUMAKRAS treatment led to increased progression-free survival and a significantly higher objective response rate in patients with KRAS G12C mutated non-small cell lung cancer compared with docetaxel. Patient-reported outcomes were also improved with LUMAKRAS versus docetaxel. We've just received initial top line data from a post-marketing requirement study comparing the 960-milligram daily dose of LUMAKRAS with a lower dose of 240 milligrams daily in patients with KRAS G12C-mutated advanced non-small cell lung cancer. Following discussions with regulators, we are planning to submit data from this study along with CodeBreaK 200 confirmatory Phase III data. As a reminder, we are investigating multiple potential to pass the first-line treatment of non-small cell lung cancer with LUMAKRAS, potentially segmented by PD-L1 expression levels, where the non-small cell lung cancer population breaks down into roughly 1/3 across PD-L1 high expressers, intermediate or low expressers, and PD-L1-negative expression. We've seen promising early data in the PD-L1-negative population and are planning to initiate a Phase III study of LUMAKRAS plus chemotherapy in first-line advanced or metastatic non-small cell lung cancer. Finally, I'm pleased to announce that the primary analysis of a Phase III study evaluating the efficacy and safety of ABP 938, an investigational biosimilar to EYLEA compared with EYLEA, met its primary endpoint in subjects with neovascular age-related macular degeneration. With these data and previously announced Phase III data from our biosimilar candidates to SOLIRIS and STELARA, we have completed our goal of delivering positive Phase III data from three biosimilars in 2022. In conclusion, with an innovative portfolio of approximately 3/4 of our clinical stage programs having first-in-class potential and a growing portfolio of biosimilars, we are well positioned to continue to deliver important new medicines for patients and growth for shareholders over the near and long term. I'll now turn it back to Bob.
Bob Bradway, Chairman and CEO
Okay. Thank you, David. And Jason, why don't we now open the line up for questions. If you would remind our callers of the procedure, we can get started.
Operator, Operator
Our first question comes from Salveen Richter with Goldman Sachs. Your line is now open.
Salveen Richter, Analyst
Good afternoon. Thanks for taking my question. On AMG 133 in obesity, could you just help us understand how you'll evaluate the data in the context of existing therapies to make a move forward decision and how you're thinking about differentiation here? Is it just a matter of taking a piece of the market given size? Or do you think there's other aspects here to the program?
Bob Bradway, Chairman and CEO
Dave, why don't you take that question?
David Reese, Executive Vice President, Research and Development
Yes. Thanks, Salveen. We know there's a lot of interest in this program. And as we mentioned, we'll be showing the data in full in the first week of December at the hybrid conference. Obesity is a large, very heterogeneous disease. It's a global public health problem. The things that I would look for in evaluating this molecule going forward will be the dosing; dosing interval; what are the kinetics of weight loss; how rapid is that weight loss; what is sustainability. And then finally, the overall tolerability. We do plan on using our extensive capabilities in human data to help shape our thinking and guide this development program as we move forward.
Salveen Richter, Analyst
Thank you.
Arvind Sood, Vice President of Investor Relations
Jason, we'll take the next question.
Operator, Operator
Our next question comes from Matthew Harrison with Morgan Stanley. Your line is now open.
Matthew Harrison, Analyst
Great. Good afternoon. Thanks for taking the question. I wanted to ask a question now that you've been through - or hopefully been through most of the contracting season for next year. I think one of the key investor concerns is obviously with biosimilar HUMIRA coming next year, what impact that could have to ENBREL and ENBREL pricing dynamics for next year. So I'm wondering if you can just comment on how to think about the potential impact to ENBREL and its pricing next year? Thanks.
Murdo Gordon, Executive Vice President
Thank you, Matthew. It's Murdo. We're obviously excited about the opportunity to launch the first biosimilar to HUMIRA. And so we are active in our discussions with payers and PBMs for that. We are not seeing a massive amount of change to ENBREL's access going forward, and we continue to believe we've got good regard on the payers and PBMs for the efficacy and the safety of ENBREL. And if there were to be a change in ENBREL pricing, it would be for volume gains. As I mentioned in my opening remarks, we're declining in volumes about 3% year-on-year. Our goal is to maintain that and maybe even improve upon it. But we're not quite finished in the contracting cycle.
Arvind Sood, Vice President of Investor Relations
Okay. Next question please?
Operator, Operator
Our next question comes from Umer Raffat with Evercore. Your line is now open.
Umer Raffat, Analyst
Hi, guys. Thanks for taking my question. I have a two part question on what everybody wants to talk about, which is obesity. So Lilly and Novo, the two lead players in the GLP space, they both have early-stage programs. I'm talking Phase I stage programs on triple agonist, et cetera. And one thing they always emphasize is that they have certain predefined thresholds for moving any of those programs forward. And those thresholds are off of incremental efficacy beyond the current most competitive products out there. And my question is, I imagine you're thinking about some of those thresholds too relative to Manjaro, perhaps Carsem, as you think about the progression of your program. And I'm curious if you could speak to that. And secondly, if you could just clarify for us, the low- and the high-dose data from single ascending dose you showed at your business review early in the year, was that an average of the first three and the highest three of the six cohorts in Phase I? Or was it the first two out of the six cohorts? I wasn't quite sure with the low and the high meant within the single ascending.
David Reese, Executive Vice President, Research and Development
Yes, we'll follow up on the latter part of your question. I can't recall offhand what that is, but in a month, you'll receive the complete data set with all of the cohorts detailed. At that time, it will be very clear. Regarding thresholds, as I mentioned earlier, there are several potential ways to differentiate here. Weight loss is certainly one; however, dosing interval, kinetics, durability, and tolerability are also crucial, as many patients switch off these agents due to tolerability issues. These are the factors we will examine to determine if we have a differentiated product that justifies our investment.
Operator, Operator
Our next question comes from Michael Yee with Jefferies. Your line is now open.
Michael Yee, Analyst
Thank you. I'm going to ask another follow-up on 133. David, last quarter, you said you actually started the Phase II. I actually didn't hear that here. Can you just talk about the actual status of where you are with 133 and also the fact that I believe it's been disclosed that you dialed back the GLP-1 potency, so we should not be expecting material, diabetes types effects, and this is not what we're looking for or people should be examining or scrutinizing? Thank you.
David Reese, Executive Vice President, Research and Development
Yes. No, I don't believe we announced we had started Phase II, Mike, but rather that we're in planning. We do expect to initiate the Phase II trial in the relative near term. And once that gets launched, of course, we'll talk about design and give guidance in terms of expected data availability. I wouldn't overthink the GLP-1 component, and I'm not sure that's on point. I think, again, when we share the data in a month, you'll get a look at that.
Operator, Operator
Our next question comes from Jay Olson with Oppenheimer. Your line is now open.
Jay Olson, Analyst
Hey, congrats on the quarter and closing the ChemoCentryx deal. You have a lot of volume growth outside the U.S. in the third quarter. And as an example, I think you said Repatha grew 73% ex-U.S. with inclusion on China's National Drug Reimbursement List. Can you talk about the pace of product launches outside the U.S. and volume growth and how do you expect U.S. versus ex-U.S. revenue mix to evolve over time? Thank you.
Bob Bradway, Chairman and CEO
Do you want to - yes, jump in.
Murdo Gordon, Executive Vice President
Thanks, Jay. Repatha demonstrates how our expanded international presence allows us to quickly introduce new products and launches. In China, we're experiencing rapid growth for Repatha. We were on the market for just over a year before getting on the national reimbursement drug list, which helped us build a solid understanding and awareness of Repatha. We primarily promoted it for patients undergoing percutaneous coronary interventions, where the need is greatest among cash-pay patients. There is significant demand in these markets to assist millions of patients at high risk of cardiovascular disease. We're actively growing our business in Japan and China, had strong volume growth in Europe, and also experienced solid growth in the U.S. We are optimistic about Repatha's progression and its potential to drive volume and revenue growth in the future. Another example is the LUMAKRAS launch, where we've received approval in about 40 markets and reimbursement in around 30. Our oncology teams globally are effectively identifying KRAS G12C second-line patients and ensuring they know about LUMAKRAS as a treatment option. I am pleased that our international presence, built over many years, is functioning effectively and yielding strong volume growth. Looking ahead, we have partner products where we may not launch in every country, but wherever Amgen holds global responsibility and rights, we feel confident about our ability to launch them successfully.
Bob Bradway, Chairman and CEO
And Jay, let me just add, in the slides we shared with you, we have the outside U.S. data available for all the different products. You'll see the current contribution from the international business there.
Operator, Operator
Our next question comes from Geoffrey Meacham with Bank of America. Your line is now open.
Unidentified Analyst, Analyst
Hey, this is Charlie on for Geoff. Thanks for taking the question and congrats on the results. I just have questions regarding the, I guess, the EYLEA as well as STELARA kind of potential launch timing. I think given you mentioned that you already submitted the STELARA data to the FDA, I'm wondering you're expecting to see the product launch kind of second half of next year and whether you anticipate any pushback from J&J? And I guess similarly kind of for EYLEA, were like launch timing is in the 2024 time frame and if you anticipate kind of any pushback from Regeneron? Thank you.
Murdo Gordon, Executive Vice President
Thanks for the question, Charlie. We're obviously pleased with the successful data readouts on those products and some that have been filed. We expect to be in the first wave of those biosimilar launches, and we're not disclosing specific launch timing on those products.
Operator, Operator
Our next question comes from Evan Seigerman with BMO Capital. Your line is now open.
Evan Seigerman, Analyst
Hi, guys. Thank you so much for taking the question. I'm not going to ask about 133 but rather on LUMAKRAS. So you had mentioned you had data from the dose-reduction trial. Can you characterize how we should think about the relative efficacy of the lower doses versus the approved dose? And on the pembro combination trial, I noticed in the slides, you talked about a dose expansion with a lower dose lead-in. Are you also treating in combination with that lower dose?
David Reese, Executive Vice President, Research and Development
Yes. Thanks, Evan. Look, we understand there's a lot of interest in the dose comparison data. We're just getting the top line results to the FDA and other regulatory authorities. So it's premature to share these data prior to their review and the appropriate conversations. In regards to the combination trial, I believe you're referring to with checkpoint inhibitors, we're doing a lower dose lead-in, as I've mentioned before, and then layering on top of that dosing the checkpoint inhibitors. So they are then given concurrently going forward.
Operator, Operator
Our next question comes from Mohit Bansal with Wells Fargo.
Mohit Bansal, Analyst
Great. Thanks for taking my questions and congrats on the quarter result. So I have a question regarding the 30%-plus year over decline that we have seen with a couple of biosimilars. Is it on expected lives 3 or 4 years after launch? And how should we think about the other biosimilars you have in your portfolio? How should we think about the long-term pricing dynamic there? Because it was an expectation that the pricing would probably stabilize after a certain point, but it doesn't seem like that in biosimilar.
Murdo Gordon, Executive Vice President
Thanks for the question, Mohit. I think what's important to remember when you're thinking at least about U.S. biosimilars is products in the buy and bill or medical benefit side will continue to see price declines over time because of the way in which the average selling price calculation works. Products on the pharmacy benefit side, so think Medicare Part D products or commercial-insured retail pharmacy products, they are likely to have slower declines in the slope of their net price over time. Now both of those conditions depend on how many competitors for each molecule. So everyone is a little bit different. But I would hesitate to put a timeframe on the class of products. I think you need to look at each one of the molecules. One thing I will say is we've been very clear on where we're going to get growth in our biosimilars portfolio, and that's by launching successive new biosimilars on top of our continuing base of business. Outside the U.S., biosimilar pricing tends to come down fairly rapidly and then can hold in some of the larger, what we call retail markets. In markets where it's a heavy tender business, prices will continue to decline as long as there are competitors in the market.
Operator, Operator
Our next question comes from Yaron Werber with Cowen.
Yaron Werber, Analyst
I got just a couple maybe. David, the first one on 133, can you comment it's an antibody? Can we assume it's monthly dosing? And then secondly, for 938 against EYLEA, now that there's going to be high-dose EYLEA, the 8 milligrams approved, it's obviously the same underlying drug, just a different formulation. How does that impact what you need to do to bring in a high-dose 938 to market and how that jives versus the fiscal year '25 potential launch?
David Reese, Executive Vice President, Research and Development
Yes. Let me address the first part regarding 133. It is a multispecific or bifunctional molecule, which has an antibody component that inhibits the GIPR receptor and another component that activates GLP-1. As you mentioned, you can anticipate antibody-like pharmacokinetics, and we will provide more details on that in a month. This will influence the dosing interval. Regarding 938, I will have Murdo provide a brief comment on that.
Murdo Gordon, Executive Vice President
Yes. Yaron, we continue to want to be able to have a full complement of competitive biosimilar products that compete effectively with their innovative parent products. And we've, I think, done that very successfully, thanks to the talented team in our formulation and process development organization. So we feel confident that we'll be able to bring various concentrations across the portfolio as needed. So we're working on that one.
Operator, Operator
Our next question comes from David Risinger with SVB Securities. Your line is now open.
David Risinger, Analyst
Great, thanks very much. So my question is on biosimilars timing for 2023, please. Regarding AMGEVITA, in light of your interchangeability study, which has an estimated completion in January, assuming that succeeds, when in 2023 do you think FDA will add interchangeability to the label? And then is Amgen planning to launch biosimilar STELARA in September at risk if patent litigation remains outstanding?
Murdo Gordon, Executive Vice President
Yes. Thanks again for the question. Maybe take the second part first. We haven't made any statements about when we will launch our biosimilar to STELARA, but we're pleased that we've got strong data in hand, and we're pleased that we've got the strength of the Amgen manufacturing network and commercial organization ready to go. And we'll track that space closely. We expect to be in the first wave of launches on STELARA, EYLEA, and SOLIRIS, the next wave of new biosimilar launches. And we expect to be in the market in early Feb in the new year with AMGEVITA. The interchangeability stat is an interesting one. I think over time, that may grow in importance. But being first with AMGEVITA, we understand it to be of lower priority from payers and PBMs. But we do expect to have interchangeability in a relevant time frame for when the other biosimilar entrants to HUMIRA come into the market.
Operator, Operator
Next question comes from Robyn Karnauskas with Truist.
Robyn Karnauskas, Analyst
I want to follow up on your comment about ENBREL in relation to the upcoming biosimilar HUMIRA launch. We’ve observed that ENBREL is frequently utilized as a second- or third-line TNF treatment. I'm interested in understanding whether you anticipate any additional pricing decreases, considering that with the HUMIRA launch, there's a potential flow-through effect to ENBREL. This could explain why there might not be a strong incentive to compete on price. Could you clarify the dynamics of this situation for me?
Murdo Gordon, Executive Vice President
Yes. Robyn, thanks for the opportunity to clarify. I didn't say that we don't expect continued price declines on ENBREL. I said we don't expect the current price declines to be dramatically different going into next year. So we do expect to continue to concede price on ENBREL as the category is quite competitive, but we don't see the slope of that changing dramatically. And ENBREL is used across a broad range of patient types in rheumatoid arthritis as well as in psoriatic arthritis. I think what we see is we see a lot of frontline usage still, and we do see some post-TNF frontline usage. So I think that will continue. Not every patient is going to respond to TNF inhibitor, and many clinicians prefer the well-demonstrated safety and efficacy profile of ENBREL, and we think that will continue despite biosimilar options in the market. So that hopefully clarifies your question.
Operator, Operator
Our next question comes from Colin Bristow with UBS. Your line is now open.
Colin Bristow, Analyst
Hey, good afternoon. Congrats on the quarter. So I'll take another one on 133, if I may. As we think about timeline, it took Lilly and Novo around 5 to 6 years to move their lips from sort of Phase I initiation to the market. Is there any reason at all for us to think that there's any sort of abbreviated path here that you could explore? And just with those sort of aforementioned time lines in mind and the fact that this efficacy bar that we see now could be raised by what are the competitor assets ahead of you, does this raise the bar for progression to Phase II from your side?
David Reese, Executive Vice President, Research and Development
Thank you for the question. Let me start by addressing obesity, which is a complex disease and a significant global public health issue. We believe that there are various underlying conditions associated with obesity. Some patients may primarily experience cardiovascular issues, while others may face type 2 diabetes or mechanical complications. We will utilize our human data capabilities to gain a deeper understanding and possibly segment these populations to identify specific benefits for certain patient subgroups. Additionally, we will consider several factors in this program moving forward, such as dosing, kinetics—particularly the speed and sustainability of weight loss—and overall tolerability. These are the aspects we will evaluate as we analyze Phase II data and decide on the next steps as the situation evolves.
Operator, Operator
Our next question comes from Carter Gould with Barclays. Your line is now open.
Carter Gould, Analyst
Great. Thanks for taking the question. Sorry to beat a dead horse here, but to follow up on the prior question, how important is it that you also pursue diabetes alongside an obesity indication? Or do you feel like you could just go after obesity and that might be able to suffice and work out commercially?
David Reese, Executive Vice President, Research and Development
Thank you, Carter. That’s a question we’ll address as we move forward. However, I don’t believe it’s crucial for this to be a diabetes medication. As I mentioned, obesity is linked to many diseases, and we will steer our development toward areas where we think we can have the greatest impact.
Operator, Operator
Our next question comes from Michael Schmidt with Guggenheim.
Unidentified Analyst, Analyst
This is Ted on for Michael. We have LUMAKRAS coming out of World conference with updated data on different combinations you presented, I mean, PD-1 and SHIP2. How do you think these different combo regimens can be positioned to develop each other? Do you have any updated view? And would you prioritize one over the other with data so far?
David Reese, Executive Vice President, Research and Development
Yes. No, in terms of the combination, SHIP2 checkpoint inhibitor combinations, we're enrolling Phase II trial now with the SHIP2 combination that will guide our development. That's a combination that could potentially be applied regardless of PD-L1 expression levels. And then as I mentioned, we are exploring in the PD-L1-positive population a low-dose run-in of LUMAKRAS then followed by layering on of the checkpoint inhibitor. And as those trials enroll, I'll provide guidance in terms of when we have data readouts. And those data will determine how we think about the first-line population. Finally, let me remind everyone again that in the PD-L1-negative population, we're going to be looking at a chemotherapy plus LUMAKRAS combination.
Arvind Sood, Vice President of Investor Relations
Jason, I see one more participant in the queue. So let's take one last question, after which Bob will make some closing comments.
Operator, Operator
Our final question is from Tim Anderson with Wolfe Research.
Tim Anderson, Analyst
I wanted to ask a two part biosimilar question related just to the U.S. market, and that's what you think uptake will be like in two disease areas that are a little different than most. So in the rare disease space, where you'll have a biosimilar SOLIRIS and then in the eye space with your biosimilar EYLEA, how do you think those will compare to disease areas where we already have precedents, such as in oncology? I know the ice space is buy and bill. I think rare diseases is not buy and both, but if you could compare those, please.
Murdo Gordon, Executive Vice President
Thank you, Tim, for your question. As I mentioned earlier, we need to consider each product individually regarding the factors that could lead to increased usage. Looking at oncology biosimilars, we initially assumed that patients might not switch during the maintenance phase of their treatment. However, what we observed in the buy-and-bill market for both MVASI and KANJINTI is that oncologists were confident in the quality of Amgen's biosimilars. This confidence was supported by the availability of our medical teams and sales representatives, who provided them with the necessary information about our biosimilars. Consequently, we did notice switching to our biosimilars during the treatment course. We realized that our expectations of hesitancy on the part of subscribers were different than anticipated. We are closely examining both SOLIRIS and EYLEA prescribers and have conducted market research with these customer segments. We are optimistic about the potential to add value to the healthcare system by providing biosimilar alternatives to these two branded products, and we believe we have a good chance of seeing significant uptake for both.
Bob Bradway, Chairman and CEO
Okay. Well, again, let me thank all of you for joining our call. We appreciate your interest in Amgen. And let me just end by saying that we remain focused on ending the year strong and positioning ourselves for a good '23 and beyond. We look forward to having a chance to engage with you again here in a few short weeks or Monday and then in a few short weeks thereafter, at various conferences. So thank you, and we'll look forward to seeing you soon.
Arvind Sood, Vice President of Investor Relations
Thanks, everybody.
Operator, Operator
This concludes our 2022 Q3 earnings call. You may now disconnect.