Amgen 2012 Annual Report Download - page 55

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48
in certain components necessary for the formulation, fill and finish of certain of our products in our Puerto Rico facility. Further
quality issues which result in unexpected additional demand for certain components may lead to shortages of required raw materials
or components (such as we have experienced with EPOGEN® glass vials). We may experience or continue to 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 of our products are sourced from other
countries and/or derived from biological sources, including mammalian tissues. In addition, one of our marketed products also
uses bovine serum and human serum albumin. 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 processes that do not require the use of certain biologically derived substances because 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 substances or other
raw materials, which may be sourced from other countries and that are used in the manufacture of our products could adversely
impact or disrupt the commercial manufacturing of our products or could result in a mandated withdrawal of our products from
the market. This could negatively impact our ability to satisfy demand for our products, which could materially and adversely
affect our product sales, business and operating results. Further, any disruptions or delays by us or by third-party suppliers or
partners in converting to alternatives to certain biologically 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 recognition of an impairment in the carrying value of certain related assets, which could have a material and adverse
effect on our business and 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 are involved
in the manufacture of 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, Prolia®, Sensipar®/Mimpara®,
Nplate®, XGEVA® and Vectibix® and plan to use contract manufacturers to produce or assist in the production of a number of our
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 facilities and those of our third-party contract manufacturers, which may be impacted
by:
• availability or contamination of raw materials, components and equipment used in the manufacturing process, particularly
those for which we have no other source or supplier;
• capacity of our facilities and those of our contract manufacturers;
• contamination by microorganisms or viruses;
• natural or other disasters, including hurricanes, earthquakes, volcanoes or fires;
• labor disputes or shortages, including the effects of a pandemic flu outbreak, natural disaster, or otherwise;
• degree of compliance with regulatory requirements;
• changes in forecasts of future demand;
• timing and actual number of production runs;
• updating of manufacturing specifications;
• production success rates and yields; and
• timing and outcome of product quality testing.
If the efficient manufacture and supply of our products is interrupted, we may experience delayed shipments, supply
constraints, stock-outs and/or recalls of our products. For example, over the past several years we have initiated a number of
voluntary recalls of certain lots of our products. (See Our current products and products in development cannot be sold if we do
not maintain or gain regulatory approval.) If we are at any time unable to provide an uninterrupted supply of our products to