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 metabolic diseases. Its top protein-based therapeutic products include Neulasta and Neupogen (both used as anti-infectives in cancer patients), Aranesp and Epogen (used to fight anemia in chronic kidney disease and cancer patients), and Enbrel for rheumatoid arthritis. In addition, Amgen has extensive drug research and development programs. Its products are marketed in approximately 100 countries to doctors, hospitals, pharmacies, and other health care providers.
Amgen's six therapeutic areas of focus are oncology and hematology, cardiovascular disease, inflammation, bone health, nephrology, and neuroscience.
In addition to Neulasta, Neupogen, Aranesp, Epogen, and Enbrel, some of the company's marketed drugs include XGEVA and Prolia (for the prevention of skeletal-related events) and Sensipar/Mimpara (for the treatment of secondary hyperparathyroidism in chronic kidney disease patients on dialysis). Amgen also markets Vectibix, Nplate, Kyprolis, BLINCYTO, Repatha, Corlanor, IMLYGIC, and Parsabiv.
Like most biotech firms, Amgen partners with other companies to get medicines on the market. It has a 50-50 partnership with Japanese brewer and drugmaker Kirin through which it develops and out-licenses certain product rights. (It agreed to buy Kirin out for $780 million in 2017.) Additionally, it has a collaboration with AstraZeneca to develop and commercialize some of the monoclonal antibodies from its clinical inflammation portfolio. The company is also working with UCB to develop and commercialize romosozumab, which has shown positive results for the treatment of osteoporosis in postmenopausal women. In another collaboration, Amgen is working with Bayer HealthCare to develop and commercialize Nexavar around the world. And in 2018, the FDA approved migraine treatment Aimovig, which is made by Amgen and Novartis.
Amgen operates distribution centers in the US (primarily in California and Kentucky) and the Netherlands. Though its products are marketed in nearly 100 countries (primarily in North America and Europe), the US accounts for some 80% of revenue. Amgen continues to expand into growth markets, adding new markets in Latin America, Asia, and the Middle East.
The company owns about 180 properties, including manufacturing facilities in Brazil, Ireland, the Netherlands, Puerto Rico, Singapore, and Turkey.
Sales and Marketing
Sales of Amgen's top offerings -- Neulasta, Enbrel, Aranesp, and Prolia -- together account for more than 60% of annual revenues. Most of these sales take place within the US market, where they are distributed through wholesalers including AmerisourceBergen, McKesson, and Cardinal Health. Amgen employs a direct sales force in the US, Canadian, and European markets to promote its products; it uses partners and independent representatives in other global markets. For instance, Kirin sells the Neupogen/Neulasta compounds in Asian markets, and Enbrel is marketed internationally by Pfizer.
Amgen also markets certain of its products directly to consumers using print, online, and television advertising. With partners, the company markets products to health care providers including physicians, hospitals, and pharmacies.
Sales to AmerisourceBergen, McKesson, and Cardinal Health each account for more than 10% of total revenue.
Amgen's revenues had been trending up for several years until 2017, when revenue took a slight dip. Net income, which had also been rising, fell significantly in 2017.
Because product sales and other revenues slipped a bit, revenue declined less than 1% to $22.8 billion in 2017. The company's top three products (ENBREL, Neulasta, and Aranesp) all had lower sales that year. This was partially offset by higher sales of Prolia and Sensipar/Mimpara. Product sales fell in the US, largely due to increased competition or reduced demand. Sales outside of the US, though, rose as a result of higher demand.
Net income, on the other hand, fell 74% to $2 billion that year. Expenses remained relatively flat, but the one-time impact of the 2017 Tax Act cut into the firm's bottom line.
Cash and cash equivalents rose 17% to $3.8 billion during 2017. Although cash used in financing activities (largely paying down debt) more than doubled, cash used in investing activities (including investments in properties) declined by more than half.
Amgen's strategy for growth covers several key areas, including developing innovative medicines, transitioning to next-generation biomanufacturing, and branching into branded biosimilars. It has made strides in these areas through such efforts as launching products around the world and investing in its manufacturing capabilities (including its new next-generation biomanufacturing plant in Singapore and a similar plant in Rhode Island, which broke ground in 2018). However, the company faces challenges which it plans to face head on.
To prepare for the pending losses of patent protection on its top products in coming years, Amgen is launching new products it hopes will best its bestsellers. The company faces increased competition as the FDA has begun approving biosimilars (generic biotech drugs) in a shorter amount of time. For example, in 2018, the FDA approved biosimilar versions of both Epogen and Neulasta. (Neulasta alone brought in some 20% of Amgen's revenue in 2017, so the loss of exclusivity could be very detrimental to the company.) In Europe, Amgen faces competition from biologics of products including Aranesp, Neupogen, and Neulasta.
In fact, the company is taking advantage of the increased acceptance of biosimilars by engaging in their development itself. In 2017 its MVASI biosimilar version of Avastin was approved by the FDA and the European Council; MVASI is the first anti-cancer biosimilar. Amgen's AMJEVITA was approved by the FDA as a competitor of Humira.
Looking for other new products, Amgen's activities are focused on identifying and validating targets through human genetics. Amgen boasts a bulging pipeline of compounds that target cancer, inflammation, kidney disease, and neurological, cardiovascular, and bone and blood disorders, mostly based on biotech technologies.
Mergers and Acquisitions
In 2019 Amgen agreed to acquire psoriasis and psoriatic arthritis drug Otezla from Celgene for $13.4 billion to strengthen its inflammation portfolio. Celgene is divesting the drug to meet regulatory approval for its merger with Bristol-Myers Squibb.
1 AMGEN CENTER DR
Thousand Oaks, CA 91320-1799
Phone: 1 (805) 447-1000
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): 21,500
Thousand Oaks, CA
Newbury Park, CA
South San Francisco, CA
West Greenwich, RI