Amgen 2007 Annual Report Download - page 62

For example, we announced that after discussions with the FDA we have decided not to file for approval of
motesanib diphosphate in refractory thyroid cancer until there is more clarity on what would constitute an appro-
priate regulatory filing package for that indication. We believe that the safety concerns around our ESAs
expressed by the FDA must be addressed to the agency’s satisfaction before new indications or expanded label-
ing of our ESA products will likely be approved.
Further, several of our product candidates have failed or been discontinued at various stages in the product
development process, including, but not limited to, Brain Derived Neurotrophic Factor (“BDNF”), Mega-
karyocyte Growth and Development Factor (“MGDF”) and Glial Cell Lined-Derived Neurotrophic Factor
(“GDNF”). For example, in 1997, we announced the failure of BDNF for the treatment of amyotrophic lateral
sclerosis, or Lou Gehrig’s Disease, because the product candidate, when administered by injection, did not pro-
duce acceptable clinical results for a specific use after a phase 3 trial, even though BDNF had progressed
successfully through preclinical and earlier clinical trials. In addition, in 1998, we discontinued development of
MGDF, a novel platelet growth factor, at the phase 3 trial stage after several people in platelet donation trials de-
veloped low platelet counts and neutralizing antibodies. Also, in June 2004, we announced that the phase 2 study
of GDNF for the treatment of advanced Parkinson’s disease did not meet the primary study endpoint upon com-
pletion of nine months of the double-blind treatment phase of the study even though a small phase 1 pilot
investigator-initiated open-label study over a three year period appeared to result in improvements for advanced
Parkinson’s disease patients. Subsequently, in the fall of 2004 we discontinued clinical development of GDNF in
patients with advanced Parkinson’s disease after several patients in the phase 2 study developed neutralizing
antibodies and new preclinical data showed that GDNF caused irreversible damage to the area of the brain crit-
ical to movement control and coordination. On February 11, 2005, we confirmed our previous decision to halt
clinical trials and, as a part of that decision and based on thorough scientific review, we also concluded that we
will not provide GDNF to the 48 patients who participated in clinical trials that were terminated in the fall of
2004. Of course, there may be other factors that prevent us from marketing a product. We cannot guarantee we
will be able to produce or manufacture commercially successful products. (See “— Difficulties, disruptions or
delays in manufacturing or failure to comply with manufacturing regulations may limit supply of our products
and limit our product sales.”; “— Our current products and products in development cannot be sold if we do not
gain or maintain regulatory approval of our products and we may be required to perform additional clinical tri-
als or change the labeling of our products or take other potentially limiting or costly actions if we or others
identify side effects after our products are on the market.” and “— Before we commercialize and sell any of our
product candidates, we must conduct clinical trials in humans; if we fail to adequately manage these trials we
may not be able to sell future products and our sales could be adversely affected.”)
Our business may be affected by government investigations or litigation.
We and certain of our subsidiaries are involved in legal proceedings relating to various patent matters, gov-
ernment investigations, our business operations, government requests for information and other legal proceedings
that arise from time to time in the ordinary course of our business. Matters required to be disclosed by us are set
forth in Note 10, “Contingencies” to the Consolidated Financial Statements and are updated as required in sub-
sequently filed Form 10-Qs. Litigation is inherently unpredictable, and the outcome can result in excessive
verdicts and/or injunctive relief that affects how we operate our business. Consequently, it is possible that we
could, in the future, incur judgments or enter into settlements of claims for monetary damages or change the way
we operate our business, which could have a material adverse effect on our results of operations, financial posi-
tion or cash flows.
The federal government, state governments and private payers are investigating, and many have filed ac-
tions against numerous pharmaceutical and biotechnology companies, including Amgen and Immunex, now a
wholly owned subsidiary of ours, alleging that the reporting of prices for pharmaceutical products has resulted in
false and overstated average wholesale price (“AWP”), which in turn is alleged to have improperly inflated the
reimbursement paid by Medicare beneficiaries, insurers, state Medicaid programs, medical plans and other pay-
ers to healthcare providers who prescribed and administered those products. A number of these actions have been
brought against us and/or Immunex. Additionally, a number of states have pending investigations regarding our
Medicaid drug pricing practices and the U.S. Departments of Justice and Health and Human Services have re-
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