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About Amgen Inc.

Amgen is among the biggest of the biotechs. The company uses cellular biology and medicinal chemistry to target cancers, kidney ailments, inflammatory disorders, and other diseases. Their top protein-based therapeutic products include Enbrel (rheumatoid arthritis), Neulasta (anti-infective for cancer patients), Prolia and XGEVA (osteoporosis and bone metastases), and Aranesp and Epogen (used to fight anemia in chronic kidney disease and cancer patients). In addition, Amgen has extensive drug research and development programs. Amgen's products are marketed in about 100 countries; the US market accounts for almost 75% of sales.

Operations

Amgen operates in one business segment: human therapeutics.

Amgen's human therapeutics has six therapeutic areas that focuses on oncology/hematology, inflammation, bone health, cardiovascular disease, neuroscience, and biosimilars (generic biotech drugs).

The company's top selling drugs are rheumatoid arthritis and psoriasis treatment Enbrel bringing more than $5 billion of sales and cancer-related infection preventative Neulasta with about $4 billion. Other blockbusters bringing in more than $1 billion each include Prolia and XGEVA (bone fracture prevention), Aranesp and EPOGEN (anemia in kidney and cancer patients), and Sensipar/Mimpara (hyperparathyroidism in kidney dialysis patients). Amgen also markets Aimovig, BLINCYTO, Corlanor, IMLYGIC, KANJINTI, KYPROLIS, MVASI, Neupogen, Nplate, Parsabiv, Repatha, and Vectibix.

Like most biotech firms, Amgen partners with other companies on the development and sale of certain drugs. Through a partnership with UCB, in 2019 Amgen gained FDA approval for osteoporosis drug EVENITY, and in 2018 the FDA approved migraine treatment Aimovig, which is made by Amgen and Novartis. Additionally, Amgen commercializes cancer drug Nexavar with Bayer HealthCare, and it collaborates with AstraZeneca to develop and commercialize some of the monoclonal antibodies from its clinical inflammation portfolio.

Geographic Reach

Headquartered in Thousand Oaks, California, Amgen operates about 190 properties, including manufacturing facilities in the US (California, Massachusetts, Rhode Island, and Puerto Rico), Brazil, Ireland, the Netherlands, Singapore, and Turkey.

Though its products are marketed in about 100 countries (primarily in North America and Europe), the US accounts for more than 70% of sales. Amgen continues to expand product sales in growth markets in Latin America, Asia, and the Middle East.

Sales and Marketing

Most of Amgen's sales take place within the US market, where its medicines are distributed through wholesalers. The top three global wholesalers -- AmerisourceBergen, McKesson, and Cardinal Health -- together account for more than 80% of Amgen's US sales.

Amgen markets its products through a direct sales force in the US, Europe, and other select geographies; it uses partners in some global markets. The firm promotes its products to health care providers including physicians, hospitals, dialysis centers and pharmacies. Amgen also uses print, online, and television advertising to market certain products directly to consumers.

Advertising expenses were ranging from $620 million to more than $780 million in 2017 to 2019.

Financial Performance

After a continuous revenue increase in 2015 to 2018, with a slight decline in 2017 as key product sales were impacted by competition and demand challenges in the US market, Amgen's revenue for 2019 is on a downward trend, primarily due to the a decline in net selling price and lower milestone payments. Overall, their revenue increased 8% between 2015 and 2019. Net income, after a continuous increase is also on a downward trend in 2019.

Revenue decreased by 2% in 2019 to some $23.4 billion. US sales decreased 6%, while international sales rose 14%. Product revenue was down by 1% driven primarily by a decline in net selling price, offset partially by higher unit demand. Other revenues decreased for 2019, driven primarily by lower milestone payments, offset partially by higher royalties.

Amgen posted a net income of $7.8 billion in 2019, a decrease of $552 million from driven primarily by higher spending in research and early pipeline in support of oncology programs, offset partially by an impairment charge associated with an IPR&D asset in 2018.

The company ended 2019 with $6 billion in cash, down by $908 million from 2018. Operating activities contributed 9.2 billion while investing activities contributed $5.7 billion (mostly acquisitions), and financing activities used $15.8 billion on stock repurchases, dividends, and debt repayments.

Strategy

Amgen continues to expand their genetics validation efforts by acquiring a DNA-encoded library drug discovery platform. The platform provides access to the screening of billions of molecules and efficient optimization of drug properties in the process of identifying the drug candidate. Amgen announced a collaboration focusing on discovering new connections between genetics and human disease and another collaboration to participate in a consortium to provide the whole-genome sequencing of approximately 500,000 participants in the United Kingdom. Other collaborations of Amgen includes creating a custom-designed proteins to improve human health and another with BeiGene to advance 20 medicines from their innovative oncology pipeline in China and globally. Amgen anticipate utilizing data from clinical trials conducted in China to advance the development of their oncology portfolio globally.

From time to time, Amgen enters into business relationships, including joint ventures and collaborative arrangements. They acquire product, R&D technology rights and establish R&D collaborations with third parties to enhance their strategic position. Amgen has been in a collaboration with Novartis to jointly develop and commercialize Aimovig. They are also in a collaboration with Bayer HealthCare LLC (Bayer) to jointly develop and commercialize Nexavar.

Amgen focuses integrated activities to maintain and strengthen their competitive position in the industry. In 2019, Amgen have advanced their innovative pipeline, launched branded biosimilar programs, built global geographic reach and expanded their next generation manufacturing capabilities, while returning capital to shareholders. Amgen also continues to expand the commercialization and marketing of their products into other geographic territories, including parts of Latin America, the Middle East and Asia.

Mergers and Acquisitions

In 2019 Amgen acquired psoriasis and psoriatic arthritis drug Otezla from Celgene for $13.4 billion to strengthen its inflammation portfolio. Celgene divested the drug to meet regulatory approval for its merger with Bristol-Myers Squibb.

The company also agreed to purchase a 21% stake in Chinese biotech firm BeiGene for some $2.8 billion. BeiGene will commercialize some of Amgen's drugs such as XGEVA, KYPROLIS and BLINCYTO in the Chinese market.

Company Background

Amgen was formed as Applied Molecular Genetics (AMGen) in 1980 by scientists and venture capitalists to develop drugs based on molecular biology. In 1983 company scientist Fu-Kuen Lin cloned the human protein erythropoietin (EPO), which stimulates the body's red blood cell production. The firm went public that year and shortened its name to Amgen. 

The FDA approved Epogen (the brand name of EPO) for anemia in 1989. In 1991 Amgen received approval to market neutropenia drug Neupogen. In 2001 it won approval for Aranesp, an updated version of Epogen. In 2003 the company bought drugmaker Immunex (developer of Enbrel) for $10.3 billion. Following drug approvals include Neulasta (2002), Sensipar (2004), Vectibix (2006), Nplate (2008), Prolia and XGEVA (2010), and Corlanor, IMLYGIC, and Repatha (2015).

The firm entered the biosimilar market in 2011. It acquired deCODE Genetics (genome analysis) and Micromet (BLINCYTO developer) in 2012 and Onyx Pharmaceuticals (Kyprolis developer) in 2013.

Amgen Inc.

1 Amgen Center Dr
Thousand Oaks, CA 91320-1799
Phone: 1 (805) 447-1000

Firm Stats

Employer Type: Publicly Owned
Stock Symbol: AMGN
Stock Exchange: , NASDAQ
Chairman and CEO: Robert A. Bradway
EVP and CFO: David W. Meline
EVP Operations: Esteban Santos
Employees (This Location): 2,577
Employees (All Locations): 23,400

Major Office Locations

Thousand Oaks, CA

Other Locations

Newbury Park, CA
South San Francisco, CA
Longmont, CO
Washington, DC
Louisville, KY
Cambridge, MA
Chesterbrook, PA
West Greenwich, RI
Houston, TX
Seattle, WA
Saint-Lambert, Canada
Surrey, Canada