Amgen 2010 Annual Report Download - page 172

2010 2009
December 31,
Long-lived assets:
United States ........................................................ $ 3,248 $ 3,525
Puerto Rico ......................................................... 2,079 1,920
International countries ................................................. 195 293
Total long-lived assets ............................................... $ 5,522 $ 5,738
Major customers
In the United States, we sell primarily to wholesale distributors of pharmaceutical products. We utilize these
wholesale distributors as the principal means of distributing our products to healthcare providers, such as physicians or
their clinics, dialysis centers, hospitals and pharmacies. In Europe, our products are sold principally to healthcare
providers and/or wholesalers depending upon the distribution practice in each country. We monitor the financial
condition of our larger customers and limit our credit exposure by setting credit limits, requiring letters of credit and
obtaining credit insurance, as we deem appropriate. We had product sales to three large wholesaler customers each
accounting for more than 10% of total revenues for the years ended December 31, 2010, 2009 and 2008. On a
combined basis, these distributors accounted for 71% and 88% of worldwide gross revenues and U.S. gross product
sales, respectively, for 2010, as noted in the table below. Certain information with respect to these distributors for the
years ended December 31, 2010, 2009 and 2008 is as follows (dollar amounts in millions):
2010 2009 2008
AmerisourceBergen Corporation:
Gross product sales ............................................ $7,678 $7,179 $7,099
% of total gross revenues ........................................ 38% 37% 37%
% of U.S. gross product sales ..................................... 47% 46% 46%
McKesson Corporation:
Gross product sales ............................................ $3,913 $3,694 $3,594
% of total gross revenues ........................................ 19% 19% 19%
% of U.S. gross product sales ..................................... 24% 24% 23%
Cardinal Health, Inc.:
Gross product sales ............................................ $2,813 $2,841 $2,823
% of total gross revenues ........................................ 14% 15% 15%
% of U.S. gross product sales ..................................... 17% 18% 18%
At December 31, 2010 and 2009, amounts due from these three large wholesalers each exceeded 10% of gross
trade receivables, and accounted for 54% and 53%, respectively, of net trade receivables on a combined basis. At
December 31, 2010 and 2009, 44% and 45%, respectively, of trade receivables, net were due from customers
located outside the United States, primarily in Europe. Our total allowance for doubtful accounts as of December 31,
2010 and 2009 was not material.
21. Subsequent event
On January 24, 2011, we announced that we had entered into an agreement to acquire BioVex Group, Inc.
(“BioVex”), a privately held biotechnology company developing treatments for cancer and the prevention of
infectious disease, including OncoVEX
GM-CSF
, a novel oncolytic vaccine in phase 3 clinical development for the
treatment of melanoma and head and neck cancer. In connection with this acquisition, which will be accounted for
as a business combination, we will make an upfront payment of $425 million and will be obligated to pay up to an
additional $575 million contingent upon the achievement of certain regulatory and sales milestones with regard
F-50
AMGEN INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)