Amgen 2000 Annual Report Download - page 22
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Please find page 22 of the 2000 Amgen annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.Selling, General and Administrative
In 2000, selling, general and administrative (“SG&A’’ )expenses
increased $172.6 million or 26% over the prior year. This increase
was primarily due to higher staff-related costs and outside market-
ing expenses as the Company continues to support its existing
products and prepares for anticipated new product launches. In
1999, SG&A expenses increased $138.9 million or 27% over the
prior year primarily due to higher staff-related costs and outside
marketing expenses as the Company prepared for anticipated new
product launches.
Other Items, Net
Other items, net consisted of three non-recurring items: 1) legal
awards associated with the spillover arbitration with Johnson &
Johnson, 2) a write-off of acquired in-process research and devel-
opment associated with the acquisition of Kinetix Pharmaceuticals,
Inc. and 3) a charitable contribution to the Amgen Foundation.
See Note 4 to the Consolidated Financial Statements.
Interest and Other Income
In 2000, interest and other income increased $57.9 million or 66%
over the prior year. This increase was primarily due to gains realized
on the sale of certain equity securities in the Company’s portfolio
and higher interest income generated from the Company’s invest-
ment portfolio as a result of higher average cash balances and
higher interest rates. In 1999, interest and other income increased
$42.6 million or 93% over the prior year. This increase was princi-
pally due to the absence of write-downs recorded in 1998 of certain
non-current assets, primarily marketable equity securities.
Income Taxes
The Company’s effective tax rate was 32.0%, 30.0% and 29.5%
for 2000, 1999 and 1998, respectively. The tax rate in all three
years reflected the tax benefits from the sale of products manufac-
tured in the Company’s Puerto Rico manufacturing facility. The
Company’s tax rate has increased as a result of increased taxable
income combined with a provision in the federal tax law that caps
tax benefits associated with the Company’s Puerto Rico operations
at the 1995 income level. In addition, the 2000 tax rate increased
as a result of the write-off of acquired in-process research and
development, which is not deductible for tax purposes.
25
Management’s Discussion and Analysis
of Financial Condition and Results of Operations
91 $97.9
92 $319.7
93 $357.6
94 $537.7
95 $644.3
R&D
SG&A
Cost of Sales
Selected Operating Expenses
(as a Percent of Product Sales)
25.3%
22.5%
96
13.6%
28.4%
21.8%
97
13.6%
26.4%
20.5%
98
13.7%
27.0%
21.5%
99
13.2%
26.4%
25.8%
00
12.8%