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Amgen

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About Amgen

Amgen is among the biggest of the biotech big'uns, and it's determined to get even bigger. 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), – more... 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 50 countries (primarily in North America and Europe) to doctors, hospitals, pharmacies, and other health care providers.

Operations

Sales of the company's top offerings -- Neulasta, Neupogen, Enbrel, Aranesp, and Epogen -- together account for about 90% 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, Japanese brewer and drugmaker Kirin sells the Neupogen/Neulasta compunds in Asian markets, and Enbrel is marketed internationally by Pfizer.

Financial Analysis

Amgen experienced a 4% increase in revenues (to some $15.6 billion) in 2011 due to rising sales of its newer products. However, profits dipped 20% to $3.7 billion as the company experienced an increase in legal settlement charges (Amgen paid some $780 million to settle allegations related to its historical sales and marketing practices) and in general corporate and restructuring expenses.

The company has been conducting cost-cutting efforts, including the streamlining of facilities and sales of some noncore assets. In 2011 it sold a development and manufacturing facility in Fremont, California to Boehringer Ingelheim. Amgen aims to keep its operations nimble to minimize losses from patent expirations and other competitive and economic hazards that might impact its operations.

For instance, Amgen expects an increase in competition in future years due to US health care reform legislation that aims to allow for the approval of biosimilars (generic biotech drugs) in a shorter amount of time. Such rules already apply in the European Union, where the firm faces competition from generic biologics on products including Aranesp, Neupogen, and Neulasta. In addition, the Centers for Medicare and Medicaid (CMS) has altered its dialysis reimbursement guidelines for ESA products (those with proteins that stimulate red blood cell production), such as Epogen and Aranesp, that caused a 17% drop in revenues from ESAs during 2011.

Strategy

To prepare for the future loss of patent protection on its top products in coming years, Amgen continues to launch new products it hopes will best its bestsellers. New FDA approvals are germane to the company's long-term success, and the firm has launched a number of new products over the years including Sensipar/Mimpara, Nplate, and Vectibix. In 2010 and 2011, Amgen gained US approval to launch Prolia and XGEVA, both of which contain the same active ingredient but are used differently. Prolia is approved to treat postmenopausal osteoporosis (and cancer-related bone loss in Europe), and XGEVA is approved for treating cancer-related bone weakness. Amgen is working to extend the indications and markets for the products, and it is counting on successful commercialization of both drugs to help grow its business in the next few years.

The company also relies on gaining additional approvals on its existing bestsellers to round out its revenue channels and extend their patent protection as long as possible. For example, in addition to being a key player in the rheumatoid arthritis market, Enbrel's sales have climbed as the FDA has approved the drug to be used for psoriasis and other related inflammatory conditions. Amgen also works to shift existing patients over to its newer, next-generation products as patents expire; for instance, as Neupogen begins to face competition from biosimilars (generic biotech drugs) in some markets, the company has worked to shift patients over to Neulasta, its newer patent-protected offering for neutropenia (a low white-blood cell condition found in chemotherapy patients).

Amgen boasts a bulging internal R&D pipeline of compounds target cancer, inflammation, kidney disease, and neurological, cardiovascular, and bone and blood disorders, mostly based on biotech (molecular and cellular biology) technologies. In addition to its proprietary efforts, the company expands its product line through periodic acquisitions and partnerships. For example, Amgen has co-development deals with drugmakers including GlaxoSmithKline, Takeda Pharmaceutical, and Daiichi Sankyo. Amgen formed a new partnership with AstraZeneca in 2012 to jointly develop and commercialize five monoclonal antibodies (single-source proteins) from its clinical inflammation portfolio with applications in respiratory, dermatology, and rheumatology conditions.

Mergers and Acquisitions

In 2011 Amgen increased its cancer treatment and development programs when it acquired BioVex in a deal worth up to $1 billion ($425 million upfront, plus $575 million in potential milestone payments). The purchase added an experimental cancer vaccine, OncoVEX, that is being developed to treat melanoma and other forms of cancer. The following year the company further expanded its oncology pipeline through the purchase of biotech firm Micromet in a $1.2 billion deal; the purchase added blinatumomab, an antibody candidate in clinical development for acute lymphoblastic leukemia and non-Hodgkin's lymphoma. Also in 2012 Amgen paid $315 million to acquire KAI Pharmaceuticals and gain worldwide rights (in all markets except Japan) to its development-stage treatment of secondary hyperparathyroidism, a complication in patients with chronic kidney disease on dialysis. It also struck a $415 million deal to acquire deCODE genetics to expand its library of validated disease targets.

While the US market accounts for more than 75% of annual revenues, Amgen has also been working to extend its reach in international markets. In addition to extending its product offerings into high-growth regions such as Japan, China, Russia, and Africa, the firm has made select international acquisitions. To establish a presence in Brazil's growing market, the company paid $215 million in 2011 to acquire pharmaceutical maker Bergamo. It also purchased a manufacturing plant in Ireland from Pfizer that year. In 2012 Amgen purchased Turkish drugmaker Mustafa Nevzat Pharmaceuticals to expand its presence in the Middle East and add branded generic injectable drugs to its offerings. – less

Amgen Employer Reviews

Administrative Coordinator (Former Employee), Mississauga, ONJanuary 6, 2012
Process Engineer (Current Employee), West Greenwich, RIOctober 20, 2014
Senior Associate (Former Employee), Thousand Oaks, CAOctober 14, 2014
SENIOR MAINTENANCE TECHNICIAN /TECHNICIAN LEAD (Current Employee), West Greenwich, RIOctober 8, 2014