Amgen 2011 Annual Report Download - page 75

and we continue to seek, additional patent protection relating to our products, including patents on our products,
specific processes for making our products, formulations and particular uses of our products. However, competitors
may be able to invalidate, design around or otherwise circumvent our patents and sell competing products. For
example, while we do not expect biosimilars competition on ENBREL in the United States for the foreseeable
future, there are a number of competing therapies currently on the market and more in clinical development that are
different from ENBREL but are used to treat the same inflammatory diseases treated by ENBREL. Although we
continue to develop new products, and obtain patent protection for these new product candidates, we may not be
able to replace the revenue lost upon the expiration of the patents on our current products.
From time to time, U.S. and other policymakers have proposed reforming the patent laws and regulations of
their countries. In September 2011, after years of Congressional debate regarding patent reform legislation,
President Obama signed into law the America Invents Act (the Act) considered by many to be the most
substantial revision of U.S. patent law since 1952. The Act’s various provisions will go into effect over an
18-month period. The Act changes the current “first-to-invent” system to a system that awards a patent to the
“first-inventor-to-file” for an application for a patentable invention. This change alters the pool of available
materials that can be used to challenge patents and eliminates the ability to rely on prior research work in order to
lay claim to patent rights. Disputes as to whether the first filer is in fact the true inventor will be resolved through
newly implemented derivation proceedings. The Act also creates mechanisms to allow challenges to newly
issued patents in the patent office in post-grant proceedings and new inter partes reexamination proceedings.
Although many of the changes bring U.S. law into closer harmony with European and other national patent laws,
the new bases and procedures may make it easier for competitors to challenge our patents, which could result in
increased competition and have a material adverse effect on our product sales, business and results of operations.
The changes may also make it harder to challenge third-party patents and place greater importance on being the
first inventor to file a patent application on an invention.
Our stock price is volatile.
Our stock price, like that of our peers in the biotechnology and pharmaceutical industries, is volatile. Our
revenues and operating results may fluctuate from period to period for a number of reasons. Events such as a
delay in product development or even a relatively small revenue shortfall may cause financial results for a period
to be below our expectations or projections. As a result, our revenues and operating results and, in turn, our stock
price may be subject to significant fluctuations.
We may not be able to access the capital and credit markets on terms that are favorable to us, or at all.
The capital and credit markets may experience extreme volatility and disruption which may lead to
uncertainty and liquidity issues for both borrowers and investors. We may access the capital markets to
supplement our existing funds and cash generated from operations in satisfying our needs for working capital;
capital expenditure and debt service requirements; our plans to pay dividends and repurchase stock; and other
business initiatives we plan to strategically pursue, including acquisitions and licensing activities. In the event of
adverse capital and credit market conditions, we may not be able to obtain capital market financing on similar
favorable terms, or at all, which could have a material adverse effect on our business and results of operations.
Changes in credit ratings issued by nationally recognized credit rating agencies could adversely affect our cost of
financing and have an adverse effect on the market price of our securities.
Guidelines and recommendations published by various organizations can reduce the use of our products.
Government agencies promulgate regulations and guidelines directly applicable to us and to our products.
However, professional societies, HTA organizations, practice management groups, insurance carriers, physicians,
private health/science foundations and organizations involved in various diseases from time to time may also
publish guidelines or recommendations to healthcare providers, administrators and payers, and patient
communities. Recommendations by government agencies or those other groups/organizations may relate to such
matters as usage, dosage, route of administration and use of related therapies as well as reimbursement of our
products by government and private payers. Recommendations or guidelines that are followed by patients,
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