EXHIBIT 99
AMGEN INC.
FACTORS THAT MAY AFFECT FUTURE RESULTS
Factors That May Affect Future Results
Amgen operates in a rapidly changing environment that
involves a number of risks, some of which are beyond the
Company's control. The following discussion highlights some
of these risks and others are discussed elsewhere herein and
in other documents filed by the Company with the Securities
and Exchange Commission.
Period to period fluctuations
The Company's operating results may fluctuate for a
number of reasons. The forecasting of revenue is inherently
uncertain for a variety of reasons. Because the Company
plans its operating expenses, many of which are relatively
fixed in the short term, on the basis that revenues will
continue to grow, even a relatively small revenue shortfall
may cause a period's results to be below expectations. Such
a revenue shortfall could arise from any number of factors,
including lower than expected demand, wholesalers' buying
patterns, product pricing strategies, fluctuations in
foreign currency exchange rates, changes in government or
private reimbursement, transit interruptions, overall
economic conditions or natural disasters (including
earthquakes).
See "Results of Operations - Product sales -
NEUPOGEN(R) (Filgrastim)" for a discussion regarding
quarterly NEUPOGEN(R) sales.
The Company's stock price, like that of other
biotechnology companies, is subject to significant
volatility. If revenues or earnings in any quarter fail to
meet the investment community's expectations, there could be
an immediate impact on the Company's stock price. The stock
price may also be affected by, among other things, clinical
trial results and other product development related
announcements by Amgen or its competitors, regulatory
matters, intellectual property and legal matters, or broader
industry and market trends unrelated to the Company's
performance.
Rapid growth
In light of management's views of the potential for
future growth of the Company's business, the Company has
adopted an aggressive growth plan that includes substantial
and increased investments in research and development and
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investments in facilities that will be required to support
significant growth. This plan carries with it a number of
risks, including a higher level of operating expenses, the
difficulty of attracting and assimilating a large number of
new employees, and the complexities associated with managing
a larger and faster growing organization.
Product development
The Company intends to continue to develop product
candidates. Successful product development in the
biotechnology industry is highly uncertain and only a small
minority of research and development programs ultimately
result in commercially successful drugs. Product
development is dependent on numerous factors, many of which
are beyond the Company's control. Product candidates that
appear promising in the early phases of development may fail
to reach market for numerous reasons. They may be found to
be ineffective or to have harmful side effects in clinical
or preclinical testing, fail to receive necessary regulatory
approvals, be uneconomic because of manufacturing costs or
other factors, or be precluded from commercialization by the
proprietary rights of others. Success in preclinical and
early clinical trials does not ensure that large scale
clinical trials will be successful. Clinical results are
frequently susceptible to varying interpretations which may
delay, limit or prevent further clinical development or
regulatory approvals. The length of time necessary to
complete clinical trials and receive approval for product
marketing by regulatory authorities varies significantly by
product and indication and is often difficult to predict.
Regulatory approvals
The success of current products and future product
candidates of the Company will depend in part upon
maintaining and obtaining regulatory approval to market
products. Domestic and foreign statutes and regulations
govern matters relating to the Company's products and
product candidates and the research and development
activities associated with them. The Company's product
candidates may prove to have undesirable side effects that
may interrupt or delay clinical studies and could ultimately
prevent or limit their commercial use. The Company or
regulatory authorities may suspend or terminate clinical
trials at any time if the participants in such trials are
believed to be exposed to unacceptable health risks. Even
if regulatory approval is obtained, a marketed product and
its manufacturer are subject to continued review. Later
discovery of previously unknown problems with a product or
manufacturer may result in restrictions on such product or
manufacturer, including withdrawal of the product from the
market. Failure to obtain necessary approvals, or the
restriction, suspension, or revocation of any approvals, or
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the failure to comply with regulatory requirements could
have a material adverse effect on the Company.
Reimbursement
The success of the Company's products partially depends
upon the extent to which a consumer is willing to pay the
price or able to obtain reimbursement for the cost of these
products from government health administration authorities,
private health insurers, and other organizations.
Significant uncertainties exist as to the reimbursement
status of newly approved therapeutic products, and current
reimbursement policies for existing products may change. It
is possible that changes in reimbursement or failure to
obtain reimbursement may reduce the demand for or the price
of the Company's products.
Several factors could influence the pricing or
reimbursement for the Company's products including: (1)
third-party payors continuing to challenge the prices
charged for medical services and products, (2) the trend
towards managed care in the United States, (3) the growth of
organizations which could control or significantly influence
the purchase of health care services and products, and (4)
legislative proposals to reform health care or reduce
government insurance programs. NEUPOGEN(R) usage has been
and is expected to continue to be affected by cost
containment pressures on health care providers worldwide.
In addition, patients receiving EPOGEN(R) in connection with
treatment for end stage renal disease are covered primarily
under medical programs provided by the federal government.
Therefore, EPOGEN(R) sales may also be affected by future
changes in reimbursement rates or the basis for
reimbursement by the federal government.
Competition
Substantial competition exists in the biotechnology
industry from pharmaceutical and biotechnology companies
which may have technical or competitive advantages. The
Company competes with these companies in the development of
technologies and processes and sometimes competes with them
in acquiring technology from academic institutions,
government agencies, and other private and public research
organizations. There can be no assurance that the Company
will be able to produce or acquire rights to products that
have commercial potential. Even if the Company achieves
product commercialization, there can be no assurance that
one or more of the Company's competitors may not: (1)
achieve product commercialization earlier than the Company,
(2) receive patent protection that dominates or adversely
affects the Company's activities, or (3) have significantly
greater marketing capabilities.
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The field of biotechnology has undergone rapid and
significant technological change. The Company expects that
the technology associated with the Company's research and
development will continue to develop rapidly, and the
Company's future success will depend in large part on its
ability to maintain a competitive position with respect to
this technology. Rapid technological development by the
Company or others may result in some of the Company's
product candidates, products, or processes becoming obsolete
before the Company recovers a significant portion of the
research, development, manufacturing, and commercialization
expenses it incurs. This could have a material adverse
effect on the Company.
Intellectual property and legal matters
The patent positions of pharmaceutical and
biotechnology companies can be highly uncertain and involve
complex legal and factual questions. Accordingly the
breadth of claims allowed in such companies' patents cannot
be predicted. Patent disputes are frequent and can preclude
commercialization of products. The Company is and may in
the future be involved in material patent litigation. Such
litigation, if decided adversely, could subject the Company
to significant liabilities and cause the Company to obtain
third party licenses or cease using the technology or
product in dispute.
The Company is involved in arbitration proceedings with
Ortho Pharmaceutical Corporation, a subsidiary of Johnson &
Johnson ("Johnson & Johnson"), relating to a license granted
by the Company to Johnson & Johnson for sales of Epoetin
alfa in the United States for all human uses except dialysis
and diagnostics. See Note 4 to the Condensed Consolidated
Financial Statements - "Contingencies - Johnson and Johnson
arbitrations." While it is impossible to predict accurately
or determine the outcome of these proceedings, based
primarily upon the merits of its claims and based upon
certain liabilities established due to the inherent
uncertainty of any arbitrated result, the Company believes
that the outcome of these proceedings will not have a
material adverse effect on its financial statements.
However, it is possible that an adverse decision could,
depending on its magnitude, have a material adverse effect
on the financial statements.
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