Worldwide product sales increased 14 percent in the first quarter to $909 million
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Total product sales guidance for 2002 raised to low 20 percent range from high
teens
FOR IMMEDIATE RELEASE
THOUSAND OAKS, Calif. - April 25, 2002 - Amgen (Nasdaq:
AMGN) announced that worldwide product sales increased
14 percent to $909 million in the first quarter of 2002, from $798 million for
the first quarter last year.
Earnings per share for the first quarter of 2002 were $0.32, compared with earnings
per share of $0.28 for the first quarter of 2001, an increase of 14 percent.
"With the recent approval of NeulastaTM (pegfilgrastim),
Amgen has launched three new products in the last six months," said Kevin Sharer,
Amgen's chairman and chief executive officer. "These are exciting times for
Amgen and we are pleased with the significant progress made so far to build
the foundation necessary to ensure patient access to our new products," Sharer
added.
Research and Development expense of $203 million was 2 percent lower than the
prior year due to lower outside expenses.
As part of the anticipated acquisition of Immunex, the Company has delayed certain
near-term investments in anticipation of the research and development infrastructure
it will inherit from Immunex in the second half of the year. The Company anticipates
research and development spending will accelerate significantly in the second
half of the year once the Immunex transaction has closed.
Selling, General, and Administrative expense of $246 million was
25% higher than the prior year as support for new products and new product launches
was increased.
The company benefited from a lower tax rate in the quarter, 31% versus 34% last
year, as changes to the structure and operational effectiveness of Amgen's Puerto
Rico manufacturing operation, and to a lesser extent, changes to U.S. sales
and distribution functions reduced the tax rate. For the full year 2002, the
tax rate is expected to be approximately 31%, excluding the impact of the Immunex
acquisition. These initiatives will continue to reduce the tax rate beyond 2002.
In the quarter, Amgen issued $2.8 billion of 30-year zero coupon convertible
senior notes and utilized $650 million of the proceeds to simultaneously repurchase
approximately 11.3 million shares. Amgen's total share repurchases in the quarter
were $715 million representing the buy-back of approximately 12.5 million shares.
The remainder of the proceeds from the zero coupon convertible senior notes
will be utilized for general corporate purposes, including acquisitions, additional
share repurchases, capital expenditures, and working capital.
Amgen did not update expense and earnings per share guidance due to ongoing
decisions regarding the additional support for new product launches and the
potential impact of the Immunex acquisition.
Product Sales Performance
First quarter combined sales of EPOGEN(R) (Epoetin alfa), Amgen's anemia therapy for patients on dialysis, and AranespTM (darbepoetin alfa), its next-generation anemia treatment for patients on dialysis and not on dialysis, reached $551 million, a 10 percent increase from $503 million for EPOGEN(R)-only sales in the first quarter of 2001. Worldwide AranespTM sales in the first quarter were $39 million. The company believes that demand for EPOGEN(R) decreased slightly in the quarter due to inventory drawdowns at end-users. However, for the full year the company continues to believe that Epogen(R) sales will be driven by underlying dialysis patient growth in the 5-6% range and inflation related price increases. Amgen continues to believe that full year EPOGEN(R)/ AranespTM sales will grow in the low 20% range over 2001.
Worldwide sales of NEUPOGEN(R) (Filgrastim), used to decrease the incidence of infection during many types of cancer-related chemotherapy treatments, increased 21 percent to $355 million in the first quarter of 2002, from $294 million in the same period last year. Amgen believes that sales were driven principally by increased demand, which the company believes grew in the low double-digits, and wholesaler inventory changes. For the full year, including the impact of the recent launch of NeulastaTM, the combined NEUPOGEN(R) /NeulastaTM growth rate is expected to be in the mid-teens, versus the company's previous guidance of mid single digit growth for NEUPOGEN(R) alone.
Total product sales are expected to grow in the low 20% range over 2001 versus the company's previous guidance of high teens growth.
American Society of Oncology
In May, data will be presented on a number of Amgen's late-stage pipeline products at the annual meeting of the American Society of Oncology (ASCO) in Orlando, Florida. Presentations will detail recent studies of AranespTM treatment of anemic patients with cancer; of NeulastaTM in patients with cancer receiving chemotherapy; and of epratuzumab treatment of patients with low-grade non-Hodgkin's lymphoma.
Forward-looking Statements
This news release contains forward-looking statements with
respect to expected research and development spending, the expected tax rate,
and the expected growth in product sales, that involve significant risks and
uncertainties, including those discussed below and more fully described in the
Securities and Exchange Commission (the "SEC") reports filed by Amgen, including
our most recent Form 10-K and our Registration Statement on Form S-4 filed with
the SEC on January 31, 2002, as amended by Amendment No. 1 to the Registration
Statement filed with the SEC on March 22, 2002. Amgen conducts research in the
biotechnology/pharmaceutical field where movement from concept to product is
uncertain; consequently, there can be no guarantee that any particular product
candidate will be successful and become a commercial product.
Furthermore, our research, testing, pricing, marketing,
and other operations are subject to extensive regulation by domestic and foreign
government regulatory authorities. In addition, sales of our products are affected
by reimbursement policies imposed by third party payors, including governments,
private insurance plans, and managed care providers. These government regulations
and reimbursement policies may affect the development, usage, and pricing of
our products. Furthermore, sales of our products are affected by lower than
expected demand, changes in wholesaler buying patterns, and increased competition
from new and existing products.
In addition, while we routinely obtain patents for our products and technology,
the protection offered by our patents and patent applications may be challenged,
invalidated or circumvented by our competitors.
Because forward-looking statements involve risks and uncertainties, actual results
may differ materially from current results expected by Amgen. Amgen is providing
this information as of April 25, 2002 and expressly disclaims any duty to update
information contained in this press release.
Amgen is a global biotechnology company that discovers, develops, manufactures,
and markets important human therapeutics based on advances in cellular and molecular
biology.
CONTACT: Amgen, Thousand Oaks
| Jeff Richardson | 805/447-3227 | (media) |
| Cary Rosansky | 805/447-4634 | (investors) |
# # #
EDITOR'S NOTE: An electronic version of this news release
may be accessed via our web site at www.amgen.com. Visit the Corporate Center
and click on Amgen News. Journalists and media representatives may sign up to
receive all news releases electronically at time of announcement by filling
out a short form in the Amgen News section of the web site.
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Amgen Inc.
Condensed Consolidated Statements of Operations
(In millions, except per share data)
(Unaudited)
Three Months Ended
March 31,
2002 2001
Revenues:
Product sales.......................... $ 908.6 $ 798.4
Corporate partner revenues............. 31.5 51.1
Royalty income......................... 68.4 52.1
Total revenues..................... 1,008.5 901.6
Operating expenses:
Cost of sales.......................... 103.6 89.4
Research and development............... 203.4 206.7
Selling, general and administrative.... 245.8 196.2
Loss (earnings) of affiliates, net..... (1.7) (7.2)
Total operating expenses........... 551.1 485.1
Operating income....................... 457.4 416.5
Other income (expense):
Interest and other income.............. 43.7 49.1
Interest expense, net.................. (7.0) (4.3)
Total other income................. 36.7 44.8
Income before income taxes............. 494.1 461.3
Provision for income taxes............. 153.2 156.4
Net income............................. $ 340.9 $ 304.9
Earnings per share:
Basic earnings per share............ $ 0.33 $ 0.29
Diluted* earnings per share.......... $ 0.32 $ 0.28
Shares used in calculation of earnings per share:
Basic earnings per share............ 1,043.6 1,041.1
Diluted* earnings per share.......... 1,085.6 1,086.2
*The calculation of diluted earnings per share for 2002 includes the
additional dilution from the assumed conversion of convertible notes
under the "if converted" method. Income for diluted earnings per share
in 2002 includes the add-back of interest expense and the amortization
of debt issuance costs, net of taxes, associated with such convertible
notes.
Amgen Inc.
Condensed Consolidated Balance Sheets
(In millions)
(Unaudited)
March 31, December 31,
2002 2001
Assets
Current assets:
Cash and marketable securities..... $ 5,174.5 $ 2,662.2
Trade receivables.................. 525.1 497.2
Inventories........................ 371.6 355.6
Other current assets............... 334.8 343.6
Total current assets........... 6,406.0 3,858.6
Property, plant and equipment, net..... 1,967.9 1,946.1
Other non-current assets............... 691.0 638.4
Total assets........................... $ 9,064.9 $ 6,443.1
Liabilities and Stockholders' Equity
Current liabilities.................... $ 1,068.2 $ 1,002.9
Non-current liabilities................ 3,046.9 223.0
Stockholders' equity................... 4,949.8 5,217.2
Total liabilities and
stockholders' equity............. $ 9,064.9 $ 6,443.1
Shares outstanding..................... 1,039.0 1,045.8