Amgen, based in Thousand Oaks, California, is a leading global biotech company. Its key products include Prolia, Enbrel, Xgeva, Otezla, Repatha, Tepezza, Evenity, Kyprolis, Aranesp, and Nplate. The shares are a component of the S&P 500.

Investors and analysts of all stripes seem amazed by the speed at which stocks are recovering from the early August swoon. Insiders, who had been so pessimistic a just few weeks ago, are included in this group. Among the positive indicators, the Insider Index from Vickers Stock Research has moved in a positive direction for a second week, marking its least-bearish reading since early May. Additionally, Vickers' Total One-Week Sell/Buy Ratio, NYSE One-Week Sell/Buy Ratio, and Nasdaq One-Week Sell/Buy Ratio are all lower (bullish) for a second week, and down dramatically from highs seen a mere three weeks ago. The above has led Vickers' Total, NYSE, and Nasdaq Eight-Week Sell/Buy Ratios to also move lower for the first time in months. And all of the above is taking place in an environment that features growing transaction volume now that earnings-related trading restrictions are falling away. On a sector basis, insider buying outpaced selling in the Energy sector by a factor of 2.75-times. On the flipside, selling by insiders last week was greatest in Information Technology, with shares valued at $157 million sold versus $25 million bought. This week, analysts at Vickers highlighted insider transactions of interest at Quanta Services Inc. (NYSE: PWR) and ConocoPhillips (NYSE: COP).

Amgen is a leader in biotechnology-based human therapeutics. Flagship drugs include red blood cell boosters Epogen and Aranesp, immune system boosters Neupogen and Neulasta, and Enbrel and Otezla for inflammatory diseases. Amgen introduced its first cancer therapeutic, Vectibix, in 2006 and markets bone-strengthening drug Prolia/Xgeva (approved 2010) and Evenity (2019). The acquisition of Onyx bolstered the firm's therapeutic oncology portfolio with Kyprolis. Recent launches include Repatha (cholesterol-lowering), Aimovig (migraine), Lumakras (lung cancer), and Tezspire (asthma). The 2023 Horizon acquisition brings several rare-disease drugs, including thyroid eye disease drug Tepezza. Amgen also has a growing biosimilar portfolio.

Prior to this year, the biotechnology industry had underperformed the broader market since reversing a multi-year trend that had seen superior returns since coming out of the Great Recession. But biotech has been a brighter light in 2024. In 2021 and 2022, the equal-weight SPDR Biotech ETF (XBI) Index, which includes more small-cap, development-stage companies, declined 21% and 26%, respectively, compared with a 27% gain and 18% decline for the S&P 500. The trend continued in 2023, with XBI gaining 8% compared with a 24% advance for the S&P 500. We attribute this underperformance, particularly for development-stage companies, to factors including a "risk-off" environment among investors amid elevated inflation and increasing interest rates, which contributed to challenging financing markets and a near closing of the IPO window. In addition, an elevated number of biotech companies traded below their cash reserves and explored strategic alternatives or bankruptcy. We also note increased scrutiny over runaway drug pricing weighing on the industry. But the tide may be starting to turn. Biotech has outpaced the broader Healthcare sector YTD in 2024 and, looking ahead, mergers and acquisitions (M&A) and the ability to raise capital are major keys to the future growth of the industry. We are encouraged by the return of some larger scale M&A deals and a seemingly healthy appetite for deals from larger biotech and big pharma players, as a new wave of patent expirations for many high-revenue-generating medicines is expected in the second half of the decade.