Amgen 2010 Annual Report and Financial Summary
Total Page:16
File Type:pdf, Size:1020Kb
Amgen 2010 Annual Report and Financial Summary 3/9/11 12:32 PM Amgen Mission To serve patients About Amgen Amgen Values Amgen discovers, develops, manufactures, and delivers innovative human therapeutics. A biotechnology pioneer since 1980, Amgen was Be science-based one of the fi rst companies to realize the new science’s promise by Compete intensely and win bringing safe, effective medicines from lab to manufacturing plant to Create value for patients, staff, and stockholders patient. Amgen therapeutics have changed the practice of medicine, Be ethical helping millions of people around the world in the fi ght against cancer, Trust and respect each other kidney disease, rheumatoid arthritis, bone disease, and other serious Ensure quality illnesses. With a deep and broad pipeline of potential new medicines, Work in teams Amgen remains committed to advancing science to dramatically Collaborate, communicate, improve people’s lives. and be accountable 28822_Cov.indd 2 Letter to Stockholders Robert A. Bradway, Kevin W. Sharer, President and Chairman and Chief Operating Offi cer Chief Executive Offi cer Dear Stockholders, 2010 was a year of challenges met and promises delivered for Amgen’s Products patients, stockholders, and staff. We delivered an important, innovative bone health therapy, denosumab, in the form of two novel medicines: Prolia®, Aranesp® (darbepoetin alfa) approved in Europe, the United States, and several other countries for ™ postmenopausal osteoporosis, and XGEVA , approved in the United States Enbrel® (etanercept) for the prevention of skeletal-related events in patients with bone metastases from solid tumors. We grew revenues 3 percent, adjusted earnings per EPOGEN® (Epoetin alfa) share* 6 percent, and generated nearly $6 billion in operating cash fl ow, ® despite continuing global economic turmoil and a $200 million adverse Neulasta (pegfi lgrastim) impact to revenues from U.S. healthcare reform and reimbursement NEUPOGEN® (Filgrastim) headwinds. In sum, it was a superb operational year. Nplate® (romiplostim) Developing Denosumab: Amgen at Its Best ® The story of the development of denosumab is an excellent example of Prolia (denosumab) Amgen at its best. After 15 years of extraordinary effort from molecule to Sensipar® (cinacalcet) medicine, nearly $1.5 billion of investment, millions of staff hours, and complex clinical trials with thousands of patients around the world, Amgen Vectibix® (panitumumab) delivered two medicines for patients that are seen by many as one of the biggest therapeutic opportunities in our industry. We could not be prouder XGEVA™ (denosumab) of our ability to serve patients with these Amgen-discovered, -developed, and -delivered therapeutics. 2010 $15,053 2010 $5.21 2010 $5,787 2010 $2,773 2009 14,642 2009 4.91 2009 6,336 2009 2,739 2008 15,003 2008 4.55 2008 5,988 2008 2,910 2007 14,771 2007 4.29 2007 5,401 2007 3,064 2006 14,268 2006 3.90 2006 5,389 2006 3,191 06 07 08 09 10 06 07 08 09 10 06 07 08 09 10 06 07 08 09 10 Total revenues ($ in millions) “Adjusted” earnings per share (EPS)* Cash fl ow from operations ($ in millions) “Adjusted” research and development (R&D) expenses* ($ in millions) * “Adjusted” earnings per share and “adjusted” R&D expenses are non-GAAP fi nancial measures. See page 12 for reconciliations to U.S. Generally Accepted Accounting Principles (GAAP). 38822_Txt.indd 1 3/9/11 12:17 PM For their outstanding contribution and unfailing dedication to the innovative discovery and development of denosumab, we recognized two senior scientists, David Lacey and Scott Simonet, with our most prestigious internal scientifi c award, the George B. Rathmann Award for Scientifi c Excellence (see article at left). Other 2010 Accomplishments We advanced our pipeline signifi cantly in 2010 with 13 international approvals, 37 marketing applications fi led, four new molecules in clinical trials, and eight From left, Amgen CEO Kevin Sharer, Dr. David new cross-functional product teams formed that have responsibility for the Lacey, Dr. Scott Simonet, and Roger M. Perlmutter, global design and implementation of a new product’s development and M.D., Ph.D., executive vice president of Research commercialization strategy. We garnered a number of prestigious scientifi c and Development, at the presentation of the George awards (see Awards and Recognition box on page 3). B. Rathmann Award for Scientifi c Excellence. We continued to expand globally, providing our vital medicines for more Honoring Scientifi c patients around the world. We maintained very high compliance standards Innovation and performance in an increasingly challenging environment, and ended the year with strong momentum and a powerful base from which to grow The George B. Rathmann Award for revenues and earnings again. Scientifi c Excellence, named for the visionary entrepreneur who established Leadership Changes During the year, our management team was strengthened by naming Amgen and served as its fi rst CEO, is Bob Bradway as our president and chief operating offi cer and Jon Peacock Amgen’s top honor and is given for as our new executive vice president and chief fi nancial offi cer. George Morrow, breakthrough science. executive vice president, began his transition to retirement from Amgen. George is one of the most respected executives in our industry, and his This year Amgen is proud to recognize contributions to building the modern Amgen were immense. We look two pioneering scientists with this forward to his continued consultation and friendship. prestigious award: David Lacey, senior Delivering Growth in 2011 vice president of Research, and Scott Delivering fi nancially, delivering the best pipeline, and capturing growth Simonet, vice president of Research. opportunities are the goals we have set for 2011. Beyond the successful Lacey and Simonet were instrumental launches of Prolia® (denosumab) and XGEVA™ (denosumab)—our most in the discovery and development of important growth drivers this year—we will sustain and enhance the value of our the bone therapy denosumab, now existing $15 billion business. We will focus on growing our existing products, such as Neulasta® (pegfi lgrastim), Sensipar® (cinacalcet), Nplate® (romiplostim), marketed as Prolia® and XGEVA™. and Vectibix® (panitumumab), and invest in them to capture the opportunities. Lacey and Simonet are joint recipients In 2011, we will grow our investment in R&D with additional funding in of the second Rathmann Award. The discovery research, as well as our pivotal phase 3 trials, such as AMG 386 first recipient was Fu-Kuen Lin, the for the treatment of advanced ovarian cancer and ganitumab (previously Amgen scientist who fi rst successfully known as AMG 479), used in combination with existing therapeutics for pancreatic cancer. We are excited about the potential of our pipeline in cloned the erythropoietin gene. a number of therapeutic areas, including oncology, infl ammation, bone disease, and cardiovascular disease. We also expect to achieve important regulatory goals this year. For example, we reported landmark clinical trial data for XGEVA™ in December, showing signifi cant improvement in bone-metastasis-free survival in men with prostate cancer, thereby adding to the potential of XGEVA™ to benefi t patients. 38822_Txt.indd 2 3/9/11 12:17 PM We expect to fi le for approval of a new indication in prostate cancer in Awards and Recognition the United States in the fi rst half of 2011. • Prolia® (denosumab) wins Scrip’s Innovation from Inside and Out to Drive Growth Best New Drug award, one of the We will also use our considerable fi nancial strength to acquire or license industry’s highest global accolades. innovative molecules that address important unmet medical needs. The BioVex acquisition, which we announced in January 2011 and expect • Amgen receives the International Prix to close in the fi rst quarter of 2011, supports this strategy by further Galien award for Best Biopharmaceutical strengthening our late-stage oncology pipeline. BioVex’s lead product ® candidate, OncoVEXGM-CSF, is a novel oncolytic virus in phase 3 testing that Research and Development for Nplate has demonstrated encouraging antitumor activity in clinical studies for the (romiplostim). Nplate® also wins treatment of metastatic melanoma and head and neck cancer. We are very Prix Galien awards in France, the impressed with the science behind this innovative therapeutic and believe Netherlands, and Spain. it holds substantial promise to help patients with malignant disease. • Med Ad News ranks Amgen number With a focus on growth in 2011, we are accelerating our entry into one on its list of Top 10 Most Admired faster-growing markets such as Brazil, Turkey, Mexico, and Russia. In Biotechnology Companies. 2010, we conducted business in 50 countries, and our aim is to operate in 75 countries by 2015. This means many more patients could access our • Amgen is once again included on medicines, and we could add meaningful incremental revenue by that time. Fortune’s list of the most admired companies and contenders in America. On Course with Our Mission to Serve Patients One of our greatest rewards is helping patients. So when we learned • Amgen receives Best Biotechnology through media interviews that professional golfer Phil Mickelson is using Pipeline ranking from R&D Directions. Enbrel® (etanercept) to treat his psoriatic arthritis, we were gratifi ed he felt it was making a positive difference in his life. Having discovered that Phil • The Scientist places Amgen sixth is on ENBREL, we are now partnering with him to help people learn more among large biotech and pharmaceutical about psoriatic arthritis and other infl ammatory diseases as well as the treatments available for them. companies—and number 16 overall—on its Best Places to Work in Industry list. Our mission to serve patients and our aspiration to be the best human therapeutics company are what drive and sustain us. Continuing to deliver • Amgen places among the top against this mission and aspiration by growing our company, products, and 10 percent on the Forbes Global 2000 pipeline is the best way we know to serve society, stockholders, and staff.