THOUSAND OAKS - Amgen (NASDAQ: AMGN) today announced financial results for the third quarter of 20231.
'We are excited about our pipeline progress and our operating performance in the third quarter,' said Robert A. Bradway, chairman and chief executive officer. 'With the completion of the Horizon acquisition, Amgen has added rare disease medicines that fit well with our broad innovative portfolio.'
Key results include: Total revenues increased 4% to $6.9 billion in comparison to the third quarter of 2022, resulting from a 5% increase in product sales. Product sales growth was driven by 11% volume growth, partially offset by 3% lower net selling price and 3% unfavorable changes to estimated sales deductions.
Volume growth of 11% included double-digit volume growth from BLINCYTO (blinatumomab), EVENITY (romosozumab-aqqg), Repatha (evolocumab) and Nplate (romiplostim).
U.S. volume grew 11% and ex-U.S. volume grew 12%, including 27% volume growth in the Asia Pacific region.
GAAP earnings per share (EPS) decreased 19% from $3.98 to $3.22, driven by a net impairment charge in Q3 2023 of approximately $650 million following a decision to discontinue development of AMG 340, partially offset by increased revenues.
GAAP operating income decreased from $2.7 billion to $2.0 billion, and GAAP operating margin decreased 11.7 percentage points to 30.9%.
Non-GAAP EPS increased 6% from $4.70 to $4.96, driven by increased revenues, partially offset by higher operating expenses.
Non-GAAP operating income increased from $3.3 billion to $3.4 billion, and non-GAAP operating margin decreased 0.5 percentage points to 52.0%.
The Company generated $2.5 billion of free cash flow for the third quarter of 2023 versus $2.8 billion in the third quarter of 2022.
Product Sales Performance
Total product sales increased 5% for the third quarter of 2023 versus the third quarter of 2022. Unit volumes grew 11%, partially offset by 3% lower net selling price and 3% unfavorable changes to estimated sales deductions.
General Medicine
Repatha sales increased 31% year-over-year for the third quarter, driven by 44% volume growth, partially offset by lower net selling price. In the U.S., sales grew 29%, driven by 45% volume growth, partially offset by lower net selling price resulting from higher rebates to support and expand access for patients. Outside the U.S., sales grew 34%, driven by 43% volume growth, partially offset by lower net selling price. Repatha remains the global proprotein convertase subtilisin/kexin type 9 (PCSK9) segment leader, with over 2 million patients treated since launch.
Prolia (denosumab) sales increased 14% year-over-year for the third quarter, primarily driven by 7% volume growth and higher net selling price. We are on track to treat over 7 million patients with Prolia in 2023.
EVENITY sales increased 53% year-over-year to a record $307 million for the third quarter, driven by strong volume growth. U.S. volumes grew 41% year-over-year and volumes outside the U.S. grew 63%.
Aimovig (erenumab-aooe) sales decreased 12% year-over-year for the third quarter, driven by lower net selling price, partially offset by favorable changes to estimated sales deductions.
Inflammation
TEZSPIRE (tezepelumab-ekko) generated $161 million of sales in the third quarter. Quarter-over-quarter sales increased 21%, driven by 18% volume growth that benefited from the pre-filled, single-use pen, which was approved for self-administration by the U.S. Food and Drug Administration (FDA) in the first quarter. Healthcare providers are increasingly recognizing TEZSPIRE's unique, differentiated profile and its broad potential to treat the 2.5 million patients worldwide with severe asthma who are uncontrolled, without any phenotypic or biomarker limitation.
TAVNEOS (avacopan) generated $37 million of sales in the third quarter. Quarter-over-quarter sales increased 23%, driven by volume growth. U.S. volumes grew 18% quarter-over-quarter. In the U.S., approximately 2,300 patients have now been treated with TAVNEOS.
Otezla (apremilast) sales decreased 10% year-over-year for the third quarter, driven by lower net selling price, unfavorable changes to estimated sales deductions and lower inventory levels, partially offset by 1% volume growth. In the U.S., net selling price declined, driven by higher rebates to support and expand access for commercial and Medicare Part D patients. Otezla demand in the quarter continued to be impacted by free drug programs for newly launched competition. For the remainder of 2023, we expect demand to be affected by these free drug programs.
We expect future growth for Otezla to be driven by its established efficacy and safety profile, strong payer coverage with limited prior authorization requirements and ease of administration. Otezla remains the only approved oral systemic therapy with a broad indication and is well-positioned to help the 1.5 million U.S. patients with mild-to-moderate psoriasis who cannot be optimally addressed by a topical and can benefit from a systemic treatment like Otezla.
Enbrel (etanercept) sales decreased 6% year-over-year for the third quarter, primarily driven by an 8% decline from unfavorable changes to estimated sales deductions, resulting from a $47 million favorable adjustment in the third quarter of 2022 compared to a $37 million unfavorable adjustment in this quarter. Year-over-year volume increased 1% in the third quarter, driven by an increase in new patients starting treatment as a result of improved payer coverage. For the remainder of 2023, we expect this improved coverage will lead to growth in new patients and declining net selling price.
AMJEVITA/AMGEVITA (adalimumab) sales increased 30% year-over-year for the third quarter, driven by 53% volume growth, partially offset by lower net selling price. Ex-U.S. sales increased 10% year-over-year, driven by 22% volume growth, partially offset by lower net selling price. U.S. sales increased 21% quarter-over-quarter, driven by 41% volume growth, partially offset by lower inventory levels.
Hematology-Oncology
BLINCYTO sales increased 55% year-over-year to a record $220 million for the third quarter, driven by 56% volume growth, supported by broad prescribing for patients with B-cell precursor acute lymphoblastic leukemia.
Vectibix (panitumumab) sales increased 2% year-over-year for the third quarter to a record $252 million, driven by higher net selling price and 4% volume growth, partially offset by unfavorable foreign exchange impact.
KYPROLIS (carfilzomib) sales increased 10% year-over-year for the third quarter, primarily driven by 8% volume growth.
LUMAKRAS/LUMYKRAS (sotorasib) generated $52 million of sales for the third quarter. Year-over-year sales decreased 31% for the third quarter, primarily driven by unfavorable changes to estimated sales deductions related to ongoing reimbursement negotiations in France.
XGEVA (denosumab) sales increased 5% year-over-year for the third quarter, driven by higher net selling price.
Nplate sales increased 45% year-over-year for the third quarter, driven by 43% volume growth resulting from a $142 million order from the U.S. government.
MVASI (bevacizumab-awwb) sales increased 2% year-over-year for the third quarter, driven by 17% volume growth and favorable changes to estimated sales deductions, partially offset by lower net selling price. The published third quarter Average Selling Price (ASP) for MVASI in the U.S. declined 19% year-over-year and 1% quarter-over-quarter. Going forward, we expect continued net selling price erosion driven by increased competition.
KANJINTI (trastuzumab-anns) sales decreased 72% year-over-year for the third quarter, driven by lower net selling price, unfavorable changes to estimated sales deductions and volume declines.
Established Products
Total sales of our established products, which include EPOGEN (epoetin alfa), Aranesp, Parsabiv (etelcalcetide) and Neulasta (pegfilgrastim), decreased 30% year-over-year for the third quarter, driven by lower net selling price and volume declines. In the aggregate, we expect the year-over-year net selling price and volume erosion for this portfolio of products to continue.
Non-GAAP Financial Measures
In this news release, management has presented its operating results for the third quarters of 2023 and 2022, in accordance with U.S. Generally Accepted Accounting Principles (GAAP) and on a non-GAAP basis. In addition, management has presented its full year 2023 EPS and tax guidance in accordance with GAAP and on a non-GAAP basis. These non-GAAP financial measures are computed by excluding certain items related to acquisitions, divestitures, restructuring and certain other items from the related GAAP financial measures. Beginning January 1, 2022, following industry guidance from the U.S. Securities and Exchange Commission, the Company no longer excludes adjustments for upfront license fees, development milestones and in-process research and development (IPR&D) expenses of pre-approval programs related to licensing, collaboration and asset acquisition transactions from its non-GAAP financial measures. Management has presented Free Cash Flow (FCF), which is a non-GAAP financial measure, for the third quarters of 2023 and 2022. FCF is computed by subtracting capital expenditures from operating cash flow, each as determined in accordance with GAAP.
The Company believes that its presentation of non-GAAP financial measures provides useful supplementary information to and facilitates additional analysis by investors. The Company uses certain non-GAAP financial measures to enhance an investor's overall understanding of the financial performance and prospects for the future of the Company's normal and recurring business activities by facilitating comparisons of results of normal and recurring business operations among current, past and future periods. The Company believes that FCF provides a further measure of the Company's liquidity.
The Company uses the non-GAAP financial measures set forth in the news release in connection with its own budgeting and financial planning internally to evaluate the performance of the business, including to allocate resources and to evaluate results relative to incentive compensation targets. The non-GAAP financial measures are in addition to, not a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP.
About Amgen
Amgen is committed to unlocking the potential of biology for patients suffering from serious illnesses by discovering, developing, manufacturing and delivering innovative human therapeutics. This approach begins by using tools like advanced human genetics to unravel the complexities of disease and understand the fundamentals of human biology.
Amgen focuses on areas of high unmet medical need and leverages its expertise to strive for solutions that improve health outcomes and dramatically improve people's lives. A biotechnology pioneer since 1980, Amgen has grown to be one of the world's leading independent biotechnology companies, has reached millions of patients around the world and is developing a pipeline of medicines with breakaway potential.
Amgen is one of the 30 companies that comprise the Dow Jones Industrial Average and is also part of the Nasdaq-100 index. In 2023, Amgen was named one of 'America's Greatest Workplaces' by Newsweek, one of 'America's Climate Leaders' by USA Today and one of the 'World's Best Companies' by TIME.
Forward-Looking Statements
This news release contains forward-looking statements that are based on the current expectations and beliefs of Amgen. All statements, other than statements of historical fact, are statements that could be deemed forward-looking statements, including any statements on the outcome, benefits and synergies of collaborations, or potential collaborations, with any other company (including BeiGene, Ltd. or Kyowa Kirin Co., Ltd.), the performance of Otezla (apremilast) (including anticipated Otezla sales growth and the timing of non-GAAP EPS accretion), our acquisitions of Teneobio, Inc., ChemoCentryx, Inc., or Horizon Therapeutics plc (including the prospective performance and outlook of Horizon's business, performance and opportunities and any potential strategic benefits, synergies or opportunities expected as a result of such acquisition, and any projected impacts from the Horizon acquisition on our acquisition-related expenses going forward), as well as estimates of revenues, operating margins, capital expenditures, cash, other financial metrics, expected legal, arbitration, political, regulatory or clinical results or practices, customer and prescriber patterns or practices, reimbursement activities and outcomes, effects of pandemics or other widespread health problems on our business, outcomes, progress, and other such estimates and results. Forward-looking statements involve significant risks and uncertainties, including those discussed below and more fully described in the Securities and Exchange Commission reports filed by Amgen, including our most recent annual report on Form 10-K and any subsequent periodic reports on Form 10-Q and current reports on Form 8-K. Unless otherwise noted, Amgen is providing this information as of the date of this news release and does not undertake any obligation to update any forward-looking statements contained in this document as a result of new information, future events or otherwise.
No forward-looking statement can be guaranteed and actual results may differ materially from those we project. Our results may be affected by our ability to successfully market both new and existing products domestically and internationally, clinical and regulatory developments involving current and future products, sales growth of recently launched products, competition from other products including biosimilars, difficulties or delays in manufacturing our products and global economic conditions. In addition, sales of our products are affected by pricing pressure, political and public scrutiny and reimbursement policies imposed by third-party payers, including governments, private insurance plans and managed care providers and may be affected by regulatory, clinical and guideline developments and domestic and international trends toward managed care and healthcare cost containment. Furthermore, our research, testing, pricing, marketing and other operations are subject to extensive regulation by domestic and foreign government regulatory authorities. We or others could identify safety, side effects or manufacturing problems with our products, including our devices, after they are on the market. Our business may be impacted by government investigations, litigation and product liability claims. In addition, our business may be impacted by the adoption of new tax legislation or exposure to additional tax liabilities. If we fail to meet the compliance obligations in the corporate integrity agreement between us and the U.S. government, we could become subject to significant sanctions. Further, 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, or we may fail to prevail in present and future intellectual property litigation. We perform a substantial amount of our commercial manufacturing activities at a few key facilities, including in Puerto Rico, and also depend on third parties for a portion of our manufacturing activities, and limits on supply may constrain sales of certain of our current products and product candidate development. An outbreak of disease or similar public health threat, such as COVID-19, and the public and governmental effort to mitigate against the spread of such disease, could have a significant adverse effect on the supply of materials for our manufacturing activities, the distribution of our products, the commercialization of our product candidates, and our clinical trial operations, and any such events may have a material adverse effect on our product development, product sales, business and results of operations. We rely on collaborations with third parties for the development of some of our product candidates and for the commercialization and sales of some of our commercial products. In addition, we compete with other companies with respect to many of our marketed products as well as for the discovery and development of new products. Discovery or identification of new product candidates or development of new indications for existing products cannot be guaranteed and movement from concept to product is uncertain; consequently, there can be no guarantee that any particular product candidate or development of a new indication for an existing product will be successful and become a commercial product. Further, some raw materials, medical devices and component parts for our products are supplied by sole third-party suppliers. Certain of our distributors, customers and payers have substantial purchasing leverage in their dealings with us. The discovery of significant problems with a product similar to one of our products that implicate an entire class of products could have a material adverse effect on sales of the affected products and on our business and results of operations. Our efforts to collaborate with or acquire other companies, products or technology, and to integrate the operations of companies or to support the products or technology we have acquired, may not be successful. There can be no guarantee that we will be able to realize any of the strategic benefits, synergies or opportunities arising from the Horizon acquisition, and such benefits, synergies or opportunities may take longer to realize than expected. We may not be able to successfully integrate Horizon, and such acquisition or integration may take longer, be more difficult or cost more than expected. A breakdown, cyberattack or information security breach of our information technology systems could compromise the confidentiality, integrity and availability of our systems and our data. Our stock price is volatile and may be affected by a number of events. Our business and operations may be negatively affected by the failure, or perceived failure, of achieving our environmental, social and governance objectives. The effects of global climate change and related natural disasters could negatively affect our business and operations. Global economic conditions may magnify certain risks that affect our business. Our business performance could affect or limit the ability of our Board of Directors to declare a dividend or our ability to pay a dividend or repurchase our common stock. We may not be able to access the capital and credit markets on terms that are favorable to us, or at all.
Contact:
Jessica Akopyan
Tel: 805-440-5721
Justin Claeys
Tel: 805-313-9775
AMGEN INC. 
