IS AMGEN A SAFE PORT? FIRM WEATHERS ECONOMY'S ILLS.

Byline: Evan Pondel Staff Writer

THOUSAND OAKS - Before the Sept. 11 attack in New York City and Washington, the U.S. economy was teetering on a recessionary fault line.

All the elements of an economy sinking deeper into financial despair were present: Two successive quarters in which economic activity shrinks, coupled with interest rate cuts by the Fed.

And just as the third quarter petered out, the word ``recession'' officially became apart of economists' vocabulary.

``The general consensus is now we've tipped into a recession,'' said Jack Kyser, chief economist for the Los Angeles County Economic Development Corp. ``The big question is what can we do for ourselves?''

For a Thousand Oaks-based company, the answer lies beneath a microscope.

What started out as an experiment to create dye for blue jeans blossomed into Amgen, a multibillion-dollar company that appears immune to an ailing economy.

``Amgen seems to be relatively resilient because people still use drugs in economic downtime,'' said Stefan Loren, an analyst with Legg Mason, a Baltimore-based investment group.

Among the beakers and test tubes, white-smocked scientists have been carrying out experiments at Amgen since 1983. But before the company began focusing on human diseases, some of Amgen's scientists fresh out of academia were tinkering with other ideas, including growth hormones for chickens.

``Working for Amgen was different than academia. Many of those exciting esoteric biological concepts never get to realize the benefits in academia,`` said Dr. Steve Elliott, a senior scientist at Amgen.

While growth hormone for chickens was intriguing to Elliott, the possibility of helping people battle debilitating diseases proved much more gratifying.

``Human therapeutics was a place not only where we could be successful ... it's a place where you can retain that urgency. There's a lot of disease out there,'' he said.

Last month, U.S. regulators approved Amgen's anemia drug Aranesp, potentially opening the door to a multibillion-dollar market.

``We're really pleased - the orders have been coming in and out over the last two weeks for the drug,'' said Karen Daniels, vice president of Aranesp marketing,

Anemia is characterized by a shortage of oxygen-carrying red blood cells that normally fuel the body. When a patient's kidneys aren't functioning properly, the body isn't able to produce enough erythropoietin, which stimulates production of red blood cells. Symptoms usually include general fatigue, sleep loss and heart problems.

Anthony Gringeri, vice president of product development at Amgen, said that before anemia drugs were available, doctors administered blood transfusions. However, in 1989, Amgen introduced Epogen, an anemia drug that targets patients with kidney failure.

A close relative of Epogen, Aranesp is a protein produced in Chinese hamster ovary cells. Though the Food and Drug Administration has approved Aranesp for dialysis and predialysis purposes only, the drug is far more potent than the existing treatment, Epoetin alfa, found under the names Epogen and Procrit. Epogen is manufactured by Amgen and Procrit is made by Johnson & Johnson.

Jeff Richardson, a spokesman for Amgen, said the company has submitted an application to the FDA for the approval of Aranesp in an oncological setting. The FDA took 18 months to approve Aranesp for dialysis and predialysis purposes.

As Amgen attempts to incite production of red blood cells, the company's financial health is compelling, said Ron Renaud, analyst with Bear Stearns in New York.

The company reported a 6.4 percent jump in second-quarter profits for the period ended June 30.

Net income was $321.9 million, or 30 cents a share, on revenues of $986.7 million. In the prior year's second quarter, the company earned $302.6 million, or 28 cents a share, on revenue of $914.4 million.

``I don't expect to see any surprises in the third quarter, either,'' Renaud said. Still, biotech companies haven't seen the fallout of other sectors and for that reason, Amgen is not an accurate litmus test of the economy as a whole.

``The economy out there is slowing down ... in contrast to the health care companies and biotech fortunes,'' said Dan Blake, a professor of economics at California State University, Northridge.

Amgen rose $1.29, or 2.25 percent, Friday to close at $58.74.

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2 photos, box

Photo:

(1 -- color) Research and development by Amgen scientist Steve Elliott was key to the development of the new drug Aranesp, which is grown in flasks like this one and used to treat anemia.

(2 -- color) Tony Lorenzini performs studies on erythropoietin, which stimulates production of red blood cells.

Phil McCarten/Staff Photographer

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