Amgen 2009 Annual Report Download - page 63

• unexpected demand for or shortage of raw materials, medical devices or components
• labor disputes or shortages, including the effects of a pandemic flu outbreak or otherwise
• failure to comply with our quality standards which results in quality and product failures, product con-
tamination and/or recall
These events could adversely affect our ability to satisfy demand for our products, which could adversely af-
fect our product sales and operating results materially. For example, we have experienced shortages in certain
components necessary for the formulation, fill and finish of certain of our products in our Puerto Rico facility
without impact on our ability to supply these products. However, we may experience these or other shortages in
the future resulting in delayed shipments, supply constraints, contract disputes and/or stock-outs of our products.
Also, certain of the raw materials required in the commercial and clinical manufacturing and the formulation of
our products are sourced from other countries and/or derived from biological sources, including mammalian tis-
sues. In addition, one of our marketed products also includes bovine serum and HSA. Some countries in which
we market our products may restrict the use of certain biologically derived substances in the manufacture of
drugs. We continue to investigate alternatives to certain biological sources and alternative manufacturing proc-
esses that do not require the use of certain biologically derived substances as such raw materials may be subject
to contamination and/or recall.
A material shortage, contamination, recall and/or restriction of the use of certain biologically derived sub-
stances or other raw materials, which may be sourced from other countries, used in the manufacture of our
products could adversely impact or disrupt our commercial manufacturing of our products or could result in a
mandated withdrawal of our products from the market. This could adversely affect our ability to satisfy demand
for our products, which could adversely affect our product sales and operating results materially. Further, any
disruptions or delays by us or by third-party suppliers or partners in converting to alternatives to certain bio-
logically derived substances and alternative manufacturing processes or our ability to gain regulatory approval
for the alternative materials and manufacturing processes could increase our associated costs or result in the rec-
ognition of an impairment in the carrying value of certain related assets, which could have a material and adverse
affect on our results of operations.
Manufacturing difficulties, disruptions or delays could limit supply of our products and limit our product
sales.
Manufacturing biologic human therapeutic products is difficult, complex and highly regulated. We currently
manufacture all of our principal products and plan to manufacture many of our product candidates. In addition,
we currently use third-party contract manufacturers to produce or assist in the production of ENBREL, Sensi-
par®/Mimpara®and Nplate®as well as our late-stage product candidate denosumab and plan to use contract
manufacturers to produce a number of our other late-stage product candidates. Our ability to adequately and
timely manufacture and supply our products is dependent on the uninterrupted and efficient operation of our fa-
cilities and those of our third-party contract manufacturers, which may be impacted by:
• availability or contamination of raw materials and components used in the manufacturing process, partic-
ularly those for which we have no other source or supplier
• capacity of our facilities and those of our contract manufacturers
• facility contamination by microorganisms or viruses
• labor disputes or shortages, including the effects of a pandemic flu outbreak
• compliance with regulatory requirements
• changes in forecasts of future demand
• timing and actual number of production runs
• updating of manufacturing specifications
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