Amgen 2007 Annual Report Download - page 83

Aranesp®
For the years ended December 31, 2007, 2006 and 2005, total Aranesp®sales by geographic region were as
follows (dollar amounts in millions):
2007 Change 2006 Change 2005
Aranesp®— U.S. .......................... $2,154 (23)% $2,790 33% $2,104
Aranesp®— International .................... 1,460 10% 1,331 14% 1,169
Total Aranesp®............................ $3,614 (12)% $4,121 26% $3,273
The decrease in U.S. Aranesp®sales for the year ended December 31, 2007 was principally driven by a de-
cline in demand. This decline primarily reflects physician conformance to label and reimbursement changes that
occurred throughout 2007, primarily in the supportive cancer care setting and, to a lesser extent, a decline in our
segment share. Given the timing of these label and reimbursement changes, their impact was primarily realized in
the second half of 2007, with U.S. Aranesp®sales experiencing a decrease of 38% compared to the second half
of 2006. During the latter part of the three months ended December 31, 2007, Aranesp®sales began to stabilize
within a reasonable range as physicians incorporated into their anemia management approaches the new labels
and reimbursement changes. In particular, these developments, which are discussed in more detail in “Item 1.
Business — Key Developments,” include the Decision Memorandum issued by CMS on July 30, 2007, which
significantly restricts Medicare reimbursement for use of Aranesp®in CIA and which we believe has also neg-
atively impacted Aranesp®use in CIA for patients covered by private insurance plans. In addition, these
developments include a significant decline in Aranesp®use in AoC throughout 2007 and the ESA product label
changes in the United States, which occurred on March 9, 2007 and November 8, 2007.
The increase in international Aranesp®sales for the year ended December 31, 2007 was primarily driven by
favorable foreign currency exchange rate changes of $100 million. Excluding the impact of foreign currency ex-
change rate changes, international Aranesp®sales for the year ended December 31, 2007 increased 2%.
International sales were negatively impacted in Europe by dosing conservatism in the oncology segment and
pricing pressures across all ESAs. Through December 31, 2007, biosimilars and other recently introduced mar-
keted products in Europe have not had a significant impact on Aranesp®sales.
The increase in U.S. Aranesp®sales for the year ended December 31, 2006 was primarily driven by demand
reflecting segment growth and share gains. The growth in U.S. Aranesp®sales also reflects increased Aranesp®
usage in U.S. hospital dialysis clinics from continued conversion from EPOGEN®, which we believe stabilized in
mid-2006. The increase in international Aranesp®sales for the year ended December 31, 2006 was also princi-
pally driven by demand.
In addition to the factors mentioned in the “Product sales” section above, future worldwide Aranesp®sales
will be dependent, in part, on such factors as:
• reimbursement developments including:
OCMS Decision Memorandum issued on July 30, 2007 which significantly restricts Medicare re-
imbursement for the use of Aranesp®in CIA and any related impact on private payers’
reimbursement or healthcare providers’ prescribing behavior;
Oreimbursement changes resulting from current or future product label changes;
Oreimbursement and cost containment pressures by third-party payers, including governments and
private insurance plans;
• regulatory developments, including:
Oproduct label changes occurring on November 8, 2007 and March 9, 2007 in the United States for
the class of ESAs, including Aranesp®and EPOGEN®;
Opending product label changes in the United States for the class of ESAs, including Aranesp®and
EPOGEN®, as a result of discussions with the FDA regarding safety data from the PREPARE and
GOG-191 studies and the submission of a PAS in December 2007 that addressed questions raised
at the May 10, 2007 ODAC meeting;
71