Amgen 2015 Annual Report Download - page 47

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Item 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
The following management’s discussion and analysis (MD&A) is intended to assist the reader in understanding Amgen’s
business. MD&A is provided as a supplement to, and should be read in conjunction with, our consolidated financial statements
and accompanying notes. Our results of operations discussed in MD&A are presented in conformity with accounting principles
generally accepted in the United States (GAAP). Amgen operates in one business segment: human therapeutics. Therefore, our
results of operations are discussed on a consolidated basis.
Forward-looking statements
This report and other documents we file with the SEC contain forward-looking statements that are based on current
expectations, estimates, forecasts and projections about us, our future performance, our business, our beliefs and our management’s
assumptions. In addition, we, or others on our behalf, may make forward-looking statements in press releases or written statements,
or in our communications and discussions with investors and analysts in the normal course of business through meetings, webcasts,
phone calls and conference calls. Such words as “expect,” “anticipate,” “outlook,” “could,” “target,” “project,” “intend,” “plan,”
“believe,” “seek,” “estimate,” “should,” “may,” “assume,” and “continue,” as well as variations of such words and similar
expressions are intended to identify such forward-looking statements. These statements are not guarantees of future performance
and they involve certain risks, uncertainties and assumptions that are difficult to predict. We describe our respective risks,
uncertainties and assumptions that could affect the outcome or results of operations in Item 1A. Risk Factors. We have based our
forward-looking statements on our management’s beliefs and assumptions based on information available to our management at
the time the statements are made. We caution you that actual outcomes and results may differ materially from what is expressed,
implied or forecast by our forward-looking statements. Reference is made in particular to forward-looking statements regarding
product sales, regulatory activities, clinical trial results, reimbursement, expenses, earnings per share (EPS), liquidity and capital
resources, trends and planned dividends, stock repurchases and restructuring plans. Except as required under the federal securities
laws and the rules and regulations of the SEC, we do not have any intention or obligation to update publicly any forward-looking
statements after the distribution of this report, whether as a result of new information, future events, changes in assumptions or
otherwise.
Overview
Amgen is committed to unlocking the potential of biology for patients suffering from serious illnesses by discovering,
developing, manufacturing and delivering innovative human therapeutics. This approach begins by using tools like advanced
human genetics to unravel the complexities of disease and understand the fundamentals of human biology.
Amgen focuses on areas of high unmet medical need and leverages its biologics manufacturing expertise to strive for solutions
that improve health outcomes and dramatically improve people’s lives. A biotechnology pioneer since 1980, Amgen has grown
to be one of the world’s leading independent biotechnology companies, has reached millions of patients around the world and is
developing a pipeline of medicines with breakaway potential.
Our principal products include ENBREL, Neulasta®, Aranesp®, EPOGEN®, Sensipar®/Mimpara®, XGEVA®, Prolia® and
NEUPOGEN®. For additional information about our products, see Part I, Item 1. Business—Marketing, Distribution and Selected
Marketed Products.
In 2015, we advanced our strategy, by delivering strong financial performance across the business, advancing our innovative
pipeline and branded biosimilar programs, developing improved biologic drug delivery systems, transforming our business to a
more focused operating model and returning capital to shareholders.
• Financial performance was strong, as total revenues and product sales increased 8% driven by strong performance across
the portfolio except EPOGEN® and NEUPOGEN® which both decreased by 9%. Net income and diluted EPS increased
by 35%, driven by higher total revenue and lower operating expenses. Cash flows from operating activities grew 6% to
$9.1 billion, driven by higher operating income, enabling us to grow the business and invest for the future.
• Our progress can also be seen in six innovative new launches - four in oncology and two in cardiovascular disease. For
example, we continued to expand indications for our products, including for Kyprolis® , which is now the only approved
therapy for relapsed or refractory multiple myeloma with proven efficacy as a single agent, doublet or triplet combination,
that is offered in a variety of doses to meet individual patient needs.
• Our pipeline continues to advance with the recent regulatory submissions for Parsabiv™, positive phase 3 data for
romosozumab (in collaboration with UCB), phase 2 data for AMG 334 (in collaboration with Novartis) and phase 2b
data for omecamtiv mecarbil (in collaboration with Cytokinetics). In 2015, we also continued to advance our biosimilar
program, including the filing for global regulatory approval for ABP 501, biosimilar adalimumab (HUMIRA®) and phase
3 data for ABP 215, biosimilar bevacizumab (Avastin®).