Amgen 2015 Annual Report Download - page 41

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of or actions against us citing novel theories of recovery. Any of these results could have a material adverse effect on our business
and results of operations.
We are increasingly dependent on information technology systems, infrastructure and data security.
We are increasingly dependent upon information technology systems, infrastructure and data security. The multitude and
complexity of our computer systems and the potential value of our data make them inherently vulnerable to service interruption
or destruction, malicious intrusion and random attack. Likewise, data privacy or security breaches by employees or others may
pose a risk that sensitive data including intellectual property, trade secrets or personal information belonging to the Company, its
patients, customers or other business partners may be exposed to unauthorized persons or to the public. As a global biotechnology
company, our systems are subject to frequent cyber-attacks. These attacks are growing in their frequency, sophistication and
intensity, and are becoming increasingly difficult to detect. They are often carried out by motivated, well-resourced, skilled and
persistent actors including nation states, organized crime groups and “hacktivists.” Cyber-attacks could include the deployment
of harmful malware and key loggers, a denial-of-service attack, a malicious website, the use of social engineering and other means
to affect the confidentiality, integrity and availability of our information technology systems, infrastructure and data. Our key
business partners face similar risks and any security breach of their systems could adversely affect our security posture. Although
in the past we have experienced cyber-attacks and intrusions into our computer systems, we do not believe that such attacks have
had a material adverse effect on our operations. While we continue to invest heavily in the protection of our critical or sensitive
data and information technology, there can be no assurance that our efforts will prevent or detect service interruptions or breaches
in our systems that could adversely affect our business and operations and/or result in the loss of critical or sensitive information,
which could result in financial, legal, business or reputational harm to us.
Global economic conditions may negatively affect us and may magnify certain risks that affect our business.
Our operations and performance have been, and may continue to be, affected by global economic conditions. Financial
pressures may cause government or other third-party payers to more aggressively seek cost containment measures. (See Our sales
depend on coverage and reimbursement from third-party payers, and pricing and reimbursement pressures may affect our
profitability.) As a result of global economic conditions, some third-party payers may delay or be unable to satisfy their
reimbursement obligations. Job losses or other economic hardships may also affect patients’ ability to afford health care as a result
of increased co-pay or deductible obligations, greater cost sensitivity to existing co-pay or deductible obligations, lost healthcare
insurance coverage or for other reasons. We believe such conditions have led and could continue to lead to reduced demand for
our products, which could have a material adverse effect on our product sales, business and results of operations. Economic
conditions may also adversely affect the ability of our distributors, customers and suppliers to obtain the liquidity required to buy
inventory or raw materials and to perform their obligations under agreements with us, which could disrupt our operations. Although
we monitor our distributors’, customers’ and suppliers’ financial condition and their liquidity to mitigate our business risks, some
of our distributors, customers and suppliers may become insolvent, which could have a material adverse effect on our product
sales, business and results of operations.
We maintain a significant portfolio of investments disclosed as cash equivalents and marketable securities on our Consolidated
Balance Sheet. The value of our investments may be adversely affected by interest rate fluctuations, downgrades in credit ratings,
illiquidity in the capital markets and other factors that may result in other than temporary declines in the value of our investments.
Any of those events could cause us to record impairment charges with respect to our investment portfolio or to realize losses on
the sale of investments.
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. Announcements
or discussions of possible restrictive actions by government or private payers that would impact our business or industry if ultimately
enacted or adopted may also cause our stock price to fluctuate, whether or not such restrictive actions ever actually occur. Similarly,
actual or perceived safety issues with our products or similar products can have an immediate and rapid impact on our stock price,
whether or not our operating results are materially impacted.
Item 1B. UNRESOLVED STAFF COMMENTS
None.