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Amgen(AMGN) - 2024 Q1 - Quarterly Report
AMGNAmgen(AMGN)2024-05-02 23:27
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Financial Performance - Total revenues for the three months ended March 31, 2024, were 7,447million,a227,447 million, a 22% increase from 6,105 million in the same period of 2023[10]. - Product sales reached 7,118million,upfrom7,118 million, up from 5,846 million, reflecting a 22% growth year-over-year[10]. - Operating income decreased to 991millionfrom991 million from 1,921 million, representing a decline of 48%[10]. - Net loss for the three months ended March 31, 2024, was (113)millioncomparedtoanetincomeof(113) million compared to a net income of 2,841 million in the same period of 2023[10]. - Basic and diluted loss per share for the current period was (0.21),downfromearningsof(0.21), down from earnings of 5.32 and 5.28,respectively,intheprioryear[10].−Thecompanyreportedapretaxlossof5.28, respectively, in the prior year[10]. - The company reported a pretax loss of 68 million for Q1 2024, compared to a pretax income of 3,442millioninQ12023[45].−TheeffectivetaxrateforthethreemonthsendedMarch31,2024,was(66.2)3,442 million in Q1 2023[45]. - The effective tax rate for the three months ended March 31, 2024, was (66.2)%, compared to 17.5% for the same period in 2023, primarily due to the earnings mix from the inclusion of the Horizon business[45][46]. Expenses and Investments - Research and development expenses increased to 1,343 million from 1,058million,markinga271,058 million, marking a 27% rise[10]. - Total operating expenses rose to 6,456 million, up from 4,184million,indicatinga544,184 million, indicating a 54% increase[10]. - The company reported depreciation and amortization expenses of 1,399 million for the quarter, compared to 900millionintheprioryear[23].−Amortizationoffinite−livedintangibleassetsforthethreemonthsendedMarch31,2024,was900 million in the prior year[23]. - Amortization of finite-lived intangible assets for the three months ended March 31, 2024, was 1.2 billion, compared to 693millionforthesameperiodin2023,indicatingasignificantincreaseofapproximately73.2693 million for the same period in 2023, indicating a significant increase of approximately 73.2%[74]. - The total estimated amortization of finite-lived intangible assets for the remaining nine months of 2024 is projected to be 3.6 billion[74]. Cash and Assets - Cash and cash equivalents decreased to 9,708millionfrom9,708 million from 10,944 million[15]. - Total assets as of March 31, 2024, were 92,980million,downfrom92,980 million, down from 97,154 million at the end of 2023[15]. - Total inventories decreased to 8,724millionasofMarch31,2024,from8,724 million as of March 31, 2024, from 9,518 million as of December 31, 2023, a decline of approximately 8.3%[67]. - The fair value of money market mutual funds decreased from 10,266millionasofDecember31,2023,to10,266 million as of December 31, 2023, to 9,099 million as of March 31, 2024[89]. - The fair value of equity securities decreased from 4,514millionasofDecember31,2023,to4,514 million as of December 31, 2023, to 3,985 million as of March 31, 2024[89]. Debt and Liabilities - Long-term debt decreased to 60,061millionfrom60,061 million from 63,170 million, reflecting a reduction of 5%[15]. - The total carrying value of debt decreased to 64,020millionasofMarch31,2024,from64,020 million as of March 31, 2024, from 64,613 million as of December 31, 2023[78]. - The company repurchased portions of various notes for an aggregate cost of 410millionduringthethreemonthsendedMarch31,2024,resultingina410 million during the three months ended March 31, 2024, resulting in a 133 million gain on extinguishment of debt[79]. - Total liabilities as of March 31, 2024, were 1,168million,comparedto1,168 million, compared to 1,188 million as of December 31, 2023[89]. Acquisitions - The company completed the acquisition of Horizon Therapeutics for approximately 27.8billion,enhancingitsportfolioinrarediseases[31].−Theacquisitionincludedcashconsiderationof27.8 billion, enhancing its portfolio in rare diseases[31]. - The acquisition included cash consideration of 26.7 billion and additional costs related to options and equity awards totaling 523million[33].−Thefairvalueofdeveloped−product−technologyrightsacquiredintheHorizonacquisitionwasestimatedat523 million[33]. - The fair value of developed-product-technology rights acquired in the Horizon acquisition was estimated at 19,590 million[34]. - The estimated fair value of acquired inventory from Horizon was 5,025million,withamortizationexpectedoverapproximately27months[35].LegalandRegulatoryMatters−Legalproceedingsandinvestigationsmayhaveoutcomesthataredifficulttopredict,potentiallyaffectingthecompany′sfinancialposition[116].−ThecompanyisinvolvedinpatentlitigationconcerningRepathaandotherproducts,withsignificanthearingsscheduledinthecomingyears[118].−Amgen′spatentclaimsrelatedtothe′736PatentwerefoundvalidandenforceablebytheNewJerseyDistrictCourt[121].−Amgensuccessfullydismissedindirectpurchasers′claimsintheantitrustclassactionsinDelawareDistrictCourt[122].MarketandInvestmentRisks−Thecompanyrecognizedanunrealizedlossof5,025 million, with amortization expected over approximately 27 months[35]. Legal and Regulatory Matters - Legal proceedings and investigations may have outcomes that are difficult to predict, potentially affecting the company's financial position[116]. - The company is involved in patent litigation concerning Repatha and other products, with significant hearings scheduled in the coming years[118]. - Amgen's patent claims related to the '736 Patent were found valid and enforceable by the New Jersey District Court[121]. - Amgen successfully dismissed indirect purchasers' claims in the antitrust class actions in Delaware District Court[122]. Market and Investment Risks - The company recognized an unrealized loss of 454 million on its equity investment in BeiGene for the three months ended March 31, 2024, compared to an unrealized gain of 1.9billionforthesameperiodin2023[60].−ThecarryingvalueoftheequityinvestmentinBeiGenewas1.9 billion for the same period in 2023[60]. - The carrying value of the equity investment in BeiGene was 3.0 billion as of March 31, 2024, down from 3.4billionasofDecember31,2023[60].−Thecompanyincurrednetchangesinvaluationsofcontingentconsiderationobligationsof3.4 billion as of December 31, 2023[60]. - The company incurred net changes in valuations of contingent consideration obligations of 2 million for the three months ended March 31, 2024[94].