Amgen has announced financial results for the fourth quarter and full year of 2015. Key results include:
- For the fourth quarter, total revenues increased 4 percent to $5,536 million, with 3 percent product sales growth driven by Enbrel®(etanercept), Sensipar® (cinacalcet), Prolia® (denosumab), Kyprolis® (carfilzomib) and XGEVA® (denosumab). Adjusted operating income grew 16 percent to $2,366 million and adjusted EPS grew 21 percent to $2.61.
- For the full year, total revenues increased 8 percent to $21,662 million, with 8 percent product sales growth. Adjusted operating income grew 19 percent to $10,052 million and adjusted EPS grew 19 percent to $10.38.
- 2015 adjusted operating margin improved by 4 percentage points to 48 percent.
- GAAP EPS were $2.37 in the fourth quarter compared to $1.68 a year ago and $9.06 for the full year compared to $6.70 in 2014. GAAP operating income was $2,033 million in the fourth quarter compared to $1,459 million a year ago and $8,470 million for the full year compared to $6,191 million in 2014. 2014 was negatively impacted by charges for the restructuring plan announced in the third quarter of 2014.
- Free cash flow for the full year was $8.5 billion compared to $7.8 billion in 2014 driven by higher revenues and higher operating income.
|
$Millions, except EPS and percentages
|
|
Q4 '15
|
|
Q4 '14
|
|
YOY Δ
|
|
FY '15
|
|
FY '14
|
|
YOY Δ
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Revenues
|
|
$ 5,536
|
|
$ 5,331
|
|
4%
|
|
$ 21,662
|
|
$ 20,063
|
|
8%
|
|
Adjusted Operating Income
|
|
$ 2,366
|
|
$ 2,033
|
|
16%
|
|
$ 10,052
|
|
$ 8,475
|
|
19%
|
|
Adjusted Net Income
|
|
$ 1,985
|
|
$ 1,670
|
|
19%
|
|
$ 7,954
|
|
$ 6,700
|
|
19%
|
|
Adjusted EPS
|
|
$ 2.61
|
|
$ 2.16
|
|
21%
|
|
$ 10.38
|
|
$ 8.70
|
|
19%
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
GAAP Operating Income
|
|
$ 2,033
|
|
$ 1,459
|
|
39%
|
|
$ 8,470
|
|
$ 6,191
|
|
37%
|
|
GAAP Net Income
|
|
$ 1,800
|
|
$ 1,294
|
|
39%
|
|
$ 6,939
|
|
$ 5,158
|
|
35%
|
|
GAAP EPS
|
|
$ 2.37
|
|
$ 1.68
|
|
41%
|
|
$ 9.06
|
|
$ 6.70
|
|
35%
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
References in this release to "adjusted" measures, measures presented "on an adjusted basis" or to free cash flow refer to non-GAAP financial measures. These adjustments and other items are presented on the attached reconciliations.
|
Product Sales Performance
- Total product sales increased 3 percent for the fourth quarter of 2015 versus the fourth quarter of 2014. The increase was driven primarily by ENBREL, Sensipar, Prolia, Kyprolis and XGEVA. Product sales increased 8 percent for the full year.
- ENBREL sales increased 8 percent year-over-year for the fourth quarter driven by net selling price, offset partially by the impact from inventory changes and competition. Sales increased 14 percent for the full year driven by net selling price, offset partially by the impact from competition.
- Neulasta® (pegfilgrastim) sales decreased 2 percent year-over-year for the fourth quarter driven by lower unit demand and unfavorable changes in foreign exchange rates, offset partially by net selling price. Sales increased 3 percent for the full year driven by net selling price, offset partially by unfavorable changes in foreign exchange rates.
- Aranesp® (darbepoetin alfa) sales increased 4 percent year-over-year for the fourth quarter and 1 percent for the full year. Unit demand grew in the United States (U.S.) as dialysis customers shifted some purchases from EPOGEN® (epoetin alfa) to Aranesp. Unit demand growth was offset partially by unfavorable changes in foreign exchange rates and net selling price.
- Sensipar/Mimpara® sales increased 21 percent year-over-year for the fourth quarter and 22 percent for the full year driven by net selling price and higher unit demand.
- Prolia sales increased 21 percent year-over-year for the fourth quarter and 27 percent for the full year driven by higher unit demand.
- XGEVA sales increased 10 percent year-over-year for the fourth quarter and 15 percent for the full year driven primarily by higher unit demand.
- EPOGEN sales decreased 37 percent year-over-year for the fourth quarter and 9 percent for the full year driven by the impact of competition and, to a lesser extent, the shift in U.S. dialysis customer purchases to Aranesp.
- NEUPOGEN® (filgrastim) sales decreased 4 percent year-over-year for the fourth quarter driven by the impact of competition in the U.S. and unfavorable changes in foreign exchange rates, offset partially by favorable changes in accounting estimates. Sales decreased 9 percent for the full year driven by the impact of competition in the U.S.
- Kyprolis sales increased 63 percent year-over-year for the fourth quarter and 55 percent for the full year driven by higher unit demand.
- Nplate® (romiplostim) sales increased 15 percent year-over-year for the fourth quarter and 12 percent for the full year driven by higher unit demand.
- Vectibix® (panitumumab) sales increased 2 percent year-over-year for the fourth quarter and 9 percent for the full year driven by higher unit demand, offset partially by unfavorable changes in foreign exchange rates.
|
Product Sales Detail by Product and Geographic Region
|
| |
|
$Millions, except percentages
|
|
Q4 '15
|
|
Q4 '14
|
|
YOY Δ
|
| |
|
US
|
ROW
|
TOTAL
|
|
TOTAL
|
|
TOTAL
|
| |
|
|
|
|
|
|
|
|
|
Enbrel®
|
|
$1,375
|
$66
|
$1,441
|
|
$1,337
|
|
8%
|
|
Neulasta®
|
|
960
|
196
|
1,156
|
|
1,180
|
|
(2%)
|
|
Aranesp®
|
|
249
|
250
|
499
|
|
479
|
|
4%
|
|
Sensipar® / Mimpara®
|
|
299
|
85
|
384
|
|
317
|
|
21%
|
|
Prolia®
|
|
247
|
133
|
380
|
|
315
|
|
21%
|
|
XGEVA®
|
|
254
|
102
|
356
|
|
325
|
|
10%
|
|
EPOGEN®
|
|
342
|
0
|
342
|
|
539
|
|
(37%)
|
|
NEUPOGEN®
|
|
203
|
60
|
263
|
|
274
|
|
(4%)
|
|
Kyprolis®
|
|
134
|
14
|
148
|
|
91
|
|
63%
|
|
Nplate®
|
|
82
|
55
|
137
|
|
119
|
|
15%
|
|
Vectibix®
|
|
51
|
84
|
135
|
|
132
|
|
2%
|
|
Other*
|
|
26
|
62
|
88
|
|
66
|
|
33%
|
| |
|
|
|
|
|
|
|
|
|
Total product sales
|
|
$4,222
|
$1,107
|
$5,329
|
|
$5,174
|
|
3%
|
| |
|
|
|
|
|
|
|
|
|
* Other includes MN Pharma, BLINCYTO®, Bergamo, Repatha®, Corlanor®, and IMLYGICTM
|
| |
|
|
|
|
|
|
|
|
|
$Millions, except percentages
|
|
FY '15
|
|
FY '14
|
|
YOY Δ
|
| |
|
US
|
ROW
|
TOTAL
|
|
TOTAL
|
|
TOTAL
|
| |
|
|
|
|
|
|
|
|
|
Enbrel®
|
|
$5,099
|
$265
|
$5,364
|
|
$4,688
|
|
14%
|
|
Neulasta®
|
|
3,891
|
824
|
4,715
|
|
4,596
|
|
3%
|
|
Aranesp®
|
|
900
|
1,051
|
1,951
|
|
1,930
|
|
1%
|
|
EPOGEN®
|
|
1,856
|
0
|
1,856
|
|
2,031
|
|
(9%)
|
|
Sensipar® / Mimpara®
|
|
1,069
|
346
|
1,415
|
|
1,158
|
|
22%
|
|
XGEVA®
|
|
1,006
|
399
|
1,405
|
|
1,221
|
|
15%
|
|
Prolia®
|
|
837
|
475
|
1,312
|
|
1,030
|
|
27%
|
|
NEUPOGEN®
|
|
793
|
256
|
1,049
|
|
1,159
|
|
(9%)
|
|
Vectibix®
|
|
204
|
345
|
549
|
|
505
|
|
9%
|
|
Nplate®
|
|
317
|
208
|
525
|
|
469
|
|
12%
|
|
Kyprolis®
|
|
467
|
45
|
512
|
|
331
|
|
55%
|
|
Other*
|
|
84
|
207
|
291
|
|
209
|
|
39%
|
| |
|
|
|
|
|
|
|
|
|
Total product sales
|
|
$16,523
|
$4,421
|
$20,944
|
|
$19,327
|
|
8%
|
| |
|
|
|
|
|
|
|
|
|
* Other includes MN Pharma, BLINCYTO®, Bergamo, Repatha®, Corlanor®, and IMLYGICTM
|
| |
|
|
|
|
|
|
|
|
Operating Expense, Operating Margin and Tax Rate Analysis, on an Adjusted Basis
- Operating Expenses decreased 4 percent year-over-year in the fourth quarter of 2015 and remained flat for the full year. Changes in foreign exchange rates reduced operating expenses by 2 percent in the fourth quarter and 3 percent for the full year.
- Cost of Sales margin improved by 1.6 percentage points year-over-year in the fourth quarter of 2015 and 1.3 percentage points for the full year driven primarily by manufacturing efficiencies, higher net selling price and lower royalties.
- Research & Development (R&D) expenses decreased 10 percent year-over-year in the fourth quarter of 2015 driven by savings from transformation and process improvement efforts, as well as a $60 million upfront payment in the fourth quarter of 2014 related to the Company's cancer immunotherapy collaboration with Kite Pharma. For the full year, R&D expenses decreased 5 percent driven primarily by savings from transformation and process improvement efforts, offset partially by increased support for launch products.
- Selling, General & Administrative (SG&A) expenses increased 3 percent year-over-year in the fourth quarter of 2015 and 6 percent for the full year driven primarily by investments in new product launches, offset partially by savings from transformation and process improvement efforts.
- Operating Margin improved by 5 percentage points year-over-year in the fourth quarter of 2015 and 4 percentage points for the full year.
- Adjusted Tax Rate for the fourth quarter of 2015 increased 1.4 percentage points year-over-year driven primarily by a lower benefit from the federal R&D tax credit. The full year adjusted tax rate increased 1.9 percentage points driven primarily by changes in the geographic mix of earnings.
|
$Millions, except percentages
|
|
|
|
|
|
|
|
|
|
|
|
On an Adjusted Basis
|
Q4 '15
|
|
Q4 '14
|
|
YOY Δ
|
|
FY '15
|
|
FY '14
|
|
YOY Δ
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of Sales*
|
$764
|
|
$825
|
|
(7%)
|
|
$3,033
|
|
$3,059
|
|
(1%)
|
| |
% of sales
|
14.3%
|
|
15.9%
|
|
(1.6) pts
|
|
14.5%
|
|
15.8%
|
|
(1.3) pts
|
|
Research & Development
|
$1,057
|
|
$1,168
|
|
(10%)
|
|
$3,917
|
|
$4,121
|
|
(5%)
|
| |
% of sales
|
19.8%
|
|
22.6%
|
|
(2.8) pts
|
|
18.7%
|
|
21.3%
|
|
(2.6) pts
|
|
Selling, General & Administrative
|
$1,349
|
|
$1,305
|
|
3%
|
|
$4,660
|
|
$4,408
|
|
6%
|
| |
% of sales
|
25.3%
|
|
25.2%
|
|
0.1 pts
|
|
22.2%
|
|
22.8%
|
|
(0.6) pts
|
|
TOTAL Operating Expenses
|
$3,170
|
|
$3,298
|
|
(4%)
|
|
$11,610
|
|
$11,588
|
|
0%
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Margin
|
|
|
|
|
|
|
|
|
|
|
|
| |
operating income as a % of sales
|
44.4%
|
|
39.3%
|
|
5.1 pts
|
|
48.0%
|
|
43.9%
|
|
4.1 pts
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax Rate*
|
11.6%
|
|
10.2%
|
|
1.4 pts
|
|
16.8%
|
|
14.9%
|
|
1.9 pts
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
pts: percentage points
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
*
|
Impact of Puerto Rico excise tax is included in Cost of Sales and Tax Rate. Excluding Puerto Rico excise tax, Cost of Sales would be 1.8 pts. and 1.9 pts. lower for full years 2015 and 2014, respectively; and the Tax Rate would be 2.7 pts. and 3.3 pts. higher for full years 2015 and 2014.
|
Cash Flow and Balance Sheet
- The Company generated $1.9 billion of free cash flow in the fourth quarter of 2015 versus $2.2 billion in the fourth quarter of 2014. For the full year, free cash flow was $8.5 billion compared to $7.8 billion in 2014 driven by higher revenues and higher operating income.
- The Company's first quarter 2016 dividend of $1.00 per share declared on Dec. 15, 2015, will be paid on March 8, 2016, to all stockholders of record as of Feb. 16, 2016.
- During the fourth quarter, the Company repurchased 1.2 million shares of common stock at a total cost of $184 million. For the full year, the Company repurchased 12 million shares of common stock at a total cost of $1.85 billion. At the end of 2015, the Company had $4.9 billion remaining under its stock repurchase authorization.
|
$Billions, except shares
|
|
Q4 '15
|
|
Q4 '14
|
|
YOY Δ
|
|
FY '15
|
|
FY '14
|
|
YOY Δ
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Cash Flow
|
$2.1
|
|
$2.4
|
|
($0.4)
|
|
$9.1
|
|
$8.6
|
|
$0.5
|
|
Capital Expenditures
|
0.2
|
|
0.2
|
|
0.0
|
|
0.6
|
|
0.7
|
|
0.1
|
|
Free Cash Flow
|
1.9
|
|
2.2
|
|
(0.4)
|
|
8.5
|
|
7.8
|
|
0.6
|
|
Dividends Paid
|
0.6
|
|
0.5
|
|
0.1
|
|
2.4
|
|
1.9
|
|
0.5
|
|
Share Repurchase
|
0.2
|
|
0.2
|
|
0.0
|
|
1.9
|
|
0.2
|
|
1.7
|
|
Avg. Diluted Shares (millions)
|
761
|
|
772
|
|
(11)
|
|
766
|
|
770
|
|
(4)
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and Investments
|
31.4
|
|
27.0
|
|
4.4
|
|
31.4
|
|
27.0
|
|
4.4
|
|
Debt Outstanding
|
31.6
|
|
30.7
|
|
0.9
|
|
31.6
|
|
30.7
|
|
0.9
|
|
Stockholders' Equity
|
28.1
|
|
25.8
|
|
2.3
|
|
28.1
|
|
25.8
|
|
2.3
|
| |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |
Note: Numbers may not add due to rounding
|
|
|
|
|
|
|
2016 Guidance
For the full year 2016, the Company now expects:
- Total revenues in the range of $22.0 billion to $22.5 billion and adjusted EPS in the range of $10.60 to $11.00. Previously, the Company expected total revenues in the range of $21.7 billion to $22.3 billion and adjusted EPS in the range of $10.35 to $10.75.
- Adjusted tax rate to be in the range of 19.5 percent to 20.5 percent, which includes the benefit of the federal R&D tax credit.
- Capital expenditures to be approximately $700 million.
|
Fourth Quarter Product and Pipeline Update
|
|
Key development milestones:
|
| |
|
Clinical Program
|
Indication
|
Milestone
|
|
Repatha® (evolocumab)
|
Hyperlipidemia
|
Phase 3 CV imaging data expected H2 2016
Phase 3 CV outcomes data expected H2 2016*
Approved in Japan
|
|
Kyprolis
|
Relapsed multiple myeloma
|
Approved in U.S. (ENDEAVOR)
Approved in EU (ASPIRE)
EU regulatory review (ENDEAVOR)
|
|
IMLYGIC™ (talimogene laherparepvec)
|
Metastatic melanoma
|
Approved in EU
|
|
Parsabiv™ (etelcalcetide)†
|
Secondary hyperparathyroidism
|
Global regulatory reviews
|
|
XGEVA
|
Prevention of SREs in multiple myeloma
|
Phase 3 data expected Q4 2016*
|
|
Romosozumab‡
|
Postmenopausal osteoporosis
|
Phase 3 registrational data expected Q1 2016
|
|
AMG 334**
|
Migraine Prophylaxis
|
Phase 2b chronic migraine data expected H2 2016
|
|
ABP 215
(biosimilar bevacizumab)
|
Oncology
|
Global regulatory submissions expected 2016
|
|
ABP 501
(biosimilar adalimumab)
|
Inflammatory diseases
|
Global regulatory reviews
|
|
ABP 980
(biosimilar trastuzumab)
|
Breast Cancer
|
Phase 3 data expected H2 2016
|
|
*Event driven study; †Trade name provisionally approved by FDA; ‡Developed in world-wide collaboration with UCB, and Astellas in Japan; **Developed in collaboration with Novartis
|
The Company provided the following updates on selected product and pipeline programs:
Repatha
- In January 2016, Repatha was approved in Japan for the treatment of patients with familial hypercholesterolemia (FH) or hypercholesterolemia who have high risk of cardiovascular events and do not adequately respond to HMG-CoA reductase inhibitors (statins).
Kyprolis
- In November, the European Medicines Agency (EMA) approved the Marketing Authorization Application (MAA) for Kyprolis in combination for the treatment of relapsed multiple myeloma based on data from the Phase 3 ASPIRE study.
- In December, a Variation to the MAA was submitted to the EMA to expand the indication for Kyprolis in relapsed multiple myeloma based on data from the Phase 3 ENDEAVOR study.
- In January 2016, the U.S. Food and Drug Administration (FDA) approved the supplemental New Drug Application for Kyprolis in combination with dexamethasone or with lenalidomide plus dexamethasone for the treatment of patients with relapsed or refractory multiple myeloma who have received one to three lines of therapy. The FDA also approved Kyprolis as a single agent for the treatment of patients with relapsed or refractory multiple myeloma who have received one or more lines of therapy. This FDA decision converts to full approval the initial accelerated approval Kyprolis received in July 2012 as a single agent.
BLINCYTO® (blinatumomab)
- In November, the EMA approved the MAA for BLINCYTO for the treatment of Philadelphia chromosome-negative relapsed or refractory B-precursor acute lymphoblastic leukemia.
IMLYGIC
- In December, the EMA approved the MAA for IMLYGIC for the treatment of adults with unresectable melanoma that is regionally or distantly metastatic (Stage IIIB, IIIC and IVM1a) with no bone, brain, lung or other visceral disease.
XGEVA
- Data from the event driven Phase 3 study for the prevention of skeletal-related events in patients with multiple myeloma is expected in Q4 2016.
Romosozumab
- Data from the Phase 3 registrational study in women with postmenopausal osteoporosis is expected in Q1 2016.
AMG 334
- Data from the Phase 2b study in patients with chronic migraine is expected in H2 2016.
Biosimilars
- In January 2016, the FDA accepted for review Amgen's Biologics License Application for ABP 501, a biosimilar candidate to Humira® (adalimumab), and set a Biosimilar User Fee Act target action date of Sept. 25, 2016.
- In December, a MAA was submitted to the EMA for ABP 501.