Amgen 2011 Annual Report Download - page 74

coverage will be adequate or that such coverage will continue to remain available on acceptable terms, if at all.
The extent of the coverage of our insurance could limit our ability to mitigate for lost sales and such losses could
materially and adversely affect our product sales, business and operating results. Our Puerto Rico facility is also
subject to the same difficulties, disruptions or delays in manufacturing experienced in our other manufacturing
facilities. For example, the limited number of lots of ENBREL and EPOGEN®voluntarily recalled in 2009 and
2010 were manufactured at our Puerto Rico facility. In future inspections, our failure to adequately address the
FDA’s expectations could lead to further inspections of the facility or regulatory actions. (See Manufacturing
difficulties, disruptions or delays could limit supply of our products and limit our product sales.)
Our intellectual property positions may be challenged, invalidated, circumvented or expire, or we may fail
to prevail in present and future intellectual property litigation.
Our success depends in part on our ability to obtain and defend patent rights and other intellectual property
rights that are important to the commercialization of our products and product candidates. The patent positions of
pharmaceutical and biotechnology companies can be highly uncertain and often involve complex legal, scientific
and factual questions. Third parties may challenge, invalidate or circumvent our patents and patent applications
relating to our products, product candidates and technologies. In addition, our patent positions might not protect
us against competitors with similar products or technologies because competing products or technologies may
not infringe our patents. For certain of our product candidates, there are third parties who have patents or pending
patent applications that they may claim necessitate payment of a royalty or prevent us from commercializing
these product candidates in certain territories. Patent disputes are frequent, costly and can preclude, delay or
increase the cost of commercialization of products. We have been in the past, and may be in the future, involved
in patent litigation. A determination made by a court, agency or tribunal concerning infringement, validity,
enforceability, injunctive or economic remedy, or the right to patent protection, for example, are typically subject
to appellate or administrative review. Upon review, such initial determinations may be afforded little or no
deference by the reviewing tribunal and may be affirmed, reversed, or made the subject of reconsideration
through further proceedings. A patent dispute or litigation may not discourage a potential violator from bringing
the product that is alleged to infringe to market prior to a final resolution of the dispute or litigation. For example,
until the Pennsylvania District Court entered final judgment and a permanent injunction against Teva on July 15,
2011 pursuant to a joint stipulation and settlement agreement between the parties, Teva had announced that it
intended to sell its filgrastim product, upon approval from the FDA, in the United States without a license from
us and prior to the expiration of our G-CSF patents. The period of time from inception until resolution of a patent
dispute or litigation is subject to the availability and schedule of the court, agency or tribunal before which the
dispute or litigation is pending. We may be subject to competition during this period and may not be able to fully
recover for the losses, damages, and harms we incur from infringement by the competitor product even if we
prevail. Moreover, if we lose or settle current or future litigations at certain stages or entirely, we could be
subject to competition and/or significant liabilities, be required to enter into third-party licenses for the infringed
product or technology or be required to cease using the technology or product in dispute. In addition, we cannot
guarantee that such licenses will be available on terms acceptable to us, or at all.
Further, under the Hatch-Waxman Act, our products approved by the FDA under the Food, Drug and
Cosmetic Act may be the subject of patent litigation with generic competitors before expiry of the five year
period of data exclusivity provided for under the Hatch-Waxman Act and prior to the expiration of the patents
listed for the product. Likewise, our biologic products may be the subject of patent litigation prior to the
expiration of our patents and, with respect to competitors seeking approval as a biosimilar or interchangeable
version of our products, prior to the twelve year exclusivity period provided under the Biologics Price
Competition and Innovation Act of 2009.
Over the next several years, many of the existing patents on our principal products will expire. (See Item 1.
Business — Marketed Products.) As our patents expire, competitors may be able to legally produce and market
similar products or technologies, including biosimilars, which may have a material adverse effect on our product
sales, business and results of operations. (See Item 7A. Management’s Discussion and Analysis of Financial
Condition and Results of Operations — Financial Condition, Liquidity and Capital Resources.) We have
received,
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