AMGEN PROFITS DOWN DESPITE HIGHER REVENUE

Amgen reported a net income of $2.95 billion on revenue of $14.27 billion in 2006, compared with a net income of $3.67 billion on revenue of $12.43 billion in 2005.

R&D expenses shot up to $3.37 billion, compared with $2.31 billion the year before. The company also wrote off $1.23 billion of in-process R&D costs for companies Amgen acquired in 2006 -- $130 million for Avidia and $1.1 billion for Abgenix. Sales costs edged up to $2.09 billion from $2.08 billion, while selling, general and administrative costs increased to $3.37 billion from $2.79 billion.

As of Dec. 31, 2006, cash, cash equivalents and marketable securities were $6.3 billion, of which approximately $4.2 billion was generated from operations in foreign tax jurisdictions and is intended for use outside the U.S. On the same date, total debt outstanding was $9 billion.

Amgen said that over the past several years, its product sales growth has been primarily driven by sales of Aranesp, Neulasta and Enbrel, which have benefited primarily from gains in market share and/or segment growth. The company said it expects these products to continue to drive year-over-year sales growth in the near term, and also anticipates that Vectibix will contribute to this growth. However, the company added that maintaining or increasing market share will be more of a challenge than in previous years, as it experienced a loss of market share for Enbrel in 2006 compared with 2005.