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Amgen's 2013 Revenues Increased 8 Percent To $18.7 Billion And Adjusted Earnings Per Share (EPS) Increased 17 Percent To $7.60

Companies mentioned in this article: Amgen

THOUSAND OAKS, Calif., Jan. 28, 2014 /PRNewswire/ -- Amgen (NASDAQ:AMGN) today announced financial results for the fourth quarter and full year of 2013. Key results include:

    --  For the fourth quarter, total revenues increased 13 percent to $5,011
        million, with product sales growing at 11 percent. Adjusted EPS grew 30
        percent to $1.82, with higher revenues, the end of the Enbrel(®)
        (etanercept) profit share, and a lower tax rate partially offset by
        increased Research & Development (R&D) investment. The fourth quarter
        includes results for Onyx Pharmaceuticals, Inc. (Onyx), which was
        acquired on Oct. 1, 2013.
    --  For the full year, total revenues increased 8 percent to $18,676
        million, with 9 percent product sales growth driven by strong
        performance across the portfolio. Adjusted EPS grew 17 percent to $7.60,
        with higher revenues and a lower tax rate partially offset by increased
        R&D investment.
    --  GAAP EPS were $1.33 in the fourth quarter compared to $1.01 a year ago
        and $6.64 for the full year compared to $5.52 in 2012.
    --  Free cash flow for the full year was $5.6 billion compared to $5.2
        billion in 2012.

"Amgen delivered financially and strategically in 2013," said Robert A. Bradway, chairman & chief executive officer. "We now have ten innovative development programs with registration-enabling data expected by 2016, six biosimilars in development and expanded presence in more than 75 countries. We are excited about our prospects for long-term growth."


                                          Year-over-Year             Year-over-Year
                                          --------------             --------------

    $Millions, except EPS and percentages   Q4 '13       Q4 '12          YOY        FY '13       FY '12       YOY  
                                            ------       ------          -----      ------       ------       -----


    Total
     Revenues                                    $5,011       $4,421          13%        $18,676      $17,265       8%

    Adjusted
     Net Income                                  $1,391       $1,088          28%         $5,814       $5,119      14%

    Adjusted
     EPS                                          $1.82        $1.40          30%          $7.60        $6.51      17%


    GAAP Net
     Income                                      $1,021         $788          30%         $5,081       $4,345      17%

    GAAP EPS                                      $1.33        $1.01          32%          $6.64        $5.52      20%
    --------                                      -----        -----         ---           -----        -----     ---


    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 11 percent for the fourth quarter of 2013
        versus the fourth quarter of 2012, and 9 percent for the full year
        driven by strong performance across the portfolio.
    --  Combined Neulasta(® )(pegfilgrastim) and NEUPOGEN(®) (filgrastim)
        sales increased year-over-year by 8 percent for the fourth quarter and
        for the full year.
        --  Global Neulasta sales increased 10 percent year-over-year for the
            fourth quarter and 7 percent for the full year driven mainly by
            price.
        --  Global NEUPOGEN sales decreased 1 percent year-over-year for the
            fourth quarter. Sales increased 11 percent for the full year due to
            a $155 million order from the U.S. government that occurred in the
            third quarter of 2013.
    --  ENBREL sales increased 3 percent year-over-year for the fourth quarter
        and 7 percent for the full year driven mainly by price.
    --  Aranesp(®) (darbepoetin alfa) sales decreased 4 percent year-over-year
        for the fourth quarter and decreased 6 percent for the full year due
        mainly to lower unit demand.
    --  EPOGEN(®) (epoetin alfa) sales increased 10 percent year-over-year for
        the fourth quarter driven by higher unit demand. Sales increased 1
        percent for the full year.
    --  Sensipar(®)/Mimpara(®) (cinacalcet) sales increased 20 percent
        year-over-year for the fourth quarter and 15 percent for the full year.
        Sales increases were driven by higher unit demand and price.
    --  Combined sales of Vectibix(®) (panitumumab) and Nplate(®)
        (romiplostim) increased 16 percent year-over-year for the fourth quarter
        and increased 12 percent for the full year driven mainly by higher unit
        demand.
    --  XGEVA(®) (denosumab) sales increased 33 percent year-over-year for the
        fourth quarter and increased 36 percent for the full year, driven by
        higher unit demand.
    --  Prolia(®) (denosumab) sales increased 53 percent year-over-year for the
        fourth quarter and increased 58 percent for the full year, driven by
        higher unit demand.
    --  Kyprolis(®) (carfilzomib) sales for the fourth quarter of 2013 were $73
        million.

Product Sales Detail by Product and Geographic Region



    $Millions, except percentages Q4 '13               Q4 '12       YOY  
                                  ------               ------       -----

                                    US       ROW       TOTAL      TOTAL     TOTAL
                                    ---      ---       -----      -----     -----


    Neulasta(R)/
     NEUPOGEN(R)                      $1,121      $286     $1,407    $1,306          8%

    Neulasta(R)                          870       228      1,098       994         10%

    NEUPOGEN(R)                          251        58        309       312        (1%)

    Enbrel(R)                          1,120        80      1,200     1,161          3%

    Aranesp(R)                           180       290        470       489        (4%)

    EPOGEN(R)                            525         0        525       479         10%

    Sensipar(R)
     /
     Mimpara(R)                          217        90        307       256         20%

    Vectibix(R)                           36        66        102        91         12%

    Nplate(R)                             66        54        120       101         19%

    XGEVA(R)/
     Prolia(R)                           351       171        522       369         41%

    XGEVA(R)                             203        83        286       215         33%

    Prolia(R)                            148        88        236       154         53%

    Kyprolis                              71         2         73         0          *

    Other                                  0        73         73        85       (14%)
                                                   ---        ---       ---


    Total
     product
     sales                            $3,687    $1,112     $4,799    $4,337         11%
                                      ======    ======     ======    ======        ===



    $Millions, except percentages FY '13                FY '12      YOY  
                                  ------                ------      -----

                                    US        ROW       TOTAL       TOTAL       TOTAL
                                   ---        ---       -----       -----       -----


     Neulasta(R)/
     NEUPOGEN(R)                       $4,668    $1,122      $5,790      $5,352         8%

    Neulasta(R)                         3,499       893       4,392       4,092         7%

    NEUPOGEN(R)                         1,169       229       1,398       1,260        11%

    Enbrel(R)                           4,256       295       4,551       4,236         7%

    Aranesp(R)                            747     1,164       1,911       2,040       (6%)

    EPOGEN(R)                           1,953         0       1,953       1,941         1%

     Sensipar(R)
     /
     Mimpara(R)                           757       332       1,089         950        15%

    Vectibix(R)                           126       263         389         359         8%

    Nplate(R)                             241       186         427         368        16%

    XGEVA(R)/
     Prolia(R)                          1,226       537       1,763       1,220        45%

    XGEVA(R)                              764       255       1,019         748        36%

    Prolia(R)                             462       282         744         472        58%

    Kyprolis(R)                            71         2          73           0         *

    Other                                   0       246         246         173        42%
                                                    ---         ---         ---


    Total
     product
     sales                            $14,045    $4,147     $18,192     $16,639         9%
                                      =======    ======     =======     =======       ===


    * Not
     meaningful
    -----------

Operating Expense and Tax Rate Analysis, on an Adjusted Basis

    --  Cost of Sales margin decreased 0.8 points in the fourth quarter of 2013
        and 0.6 points for the full year.
    --  R&D expenses increased 27 percent in the fourth quarter of 2013 and 19
        percent for the full year, primarily in support of our later-stage
        clinical programs, including evolocumab (AMG 145) and Kyprolis.
    --  Selling, General & Administrative (SG&A) expenses decreased 3 percent in
        the fourth quarter of 2013 driven primarily by the end of the ENBREL
        profit share with Pfizer on Oct. 31, which reduced expenses $129 million
        compared with the fourth quarter of 2012, offset partially by the
        addition of Onyx. For the full year, SG&A expenses increased 4 percent,
        driven primarily by the U.S. healthcare reform federal excise fee and
        the addition of Onyx.

                                                                                                                                                                                         
                           $Millions, except percentages
                                                                                                                                                                                         
    On an Adjusted Basis                       Q4 '13                    Q4 '12                  YOY                     FY '13                   FY '12                   YOY  
                                               ------                    ------                  -----                   ------                   ------                   -----
                                                                                                                                                                                         
                                                                                                                                                                   
    Cost of Sales                                     $770                      $727                        6%                  $2,870                  $2,735                        5%
                                                                                                                                                                                         
                     % of
                     sales          16.0%                    16.8%                           (0.8) pts.                            15.8%                   16.4%         (0.6) pts.
                                                                                                                                                                                       
                     % of
                     sales
                     (Excluding
                     PR
                     excise
                     tax)           13.9%                    14.7%                          (0.8) pts.                           13.8%                   14.4%         (0.6) pts.
                                                                                                                                                                   
    Research & Development                          $1,168                      $917                       27%                  $3,929                  $3,296                       19%
                                                                                                                                                                                       
                     % of
                     sales          24.3%                    21.1%                           3.2 pts.                            21.6%                   19.8%          1.8 pts.
                                                                                                                                                                   
    Selling, General &
     Administrative                                 $1,306                    $1,351                      (3%)                  $4,905                  $4,717                        4%
                                                                                                                                                                                       
                     % of
                     sales          27.2%                    31.2%                          (4.0) pts.                           27.0%                   28.3%         (1.3) pts.
                                                                                                                                                                   
    TOTAL Operating Expenses                        $3,244                    $2,995                        8%                 $11,704                 $10,748                        9%
                                                                                                                                                                                         
                                                                                                                                                                                         
    pts: percentage points
                                                                                                                                                                                         
    PR: Puerto Rico
    ---------------

    --  Tax Rates for the fourth quarter and full year of 2013 reflect the
        favorable impacts of changes in the jurisdictional mix of income and
        expenses and the current year benefit from the federal R&D credit. The
        full year adjusted tax rate also benefited from the resolution of the
        Company's federal income tax audit for tax years 2007-2009 and the
        retroactive extension of the 2012 federal R&D credit in the first
        quarter of 2013.



     On
     an
     Adjusted
     Basis                 Q4 '13      Q4 '12         YOY     FY '13      FY '12         YOY  
                           ------      ------         -----   ------      ------         -----


     Tax
     Rate                        12.7%       16.1% (3.4) pts.        9.2%       15.9% (6.7) pts.

     Tax
     Rate
     (Excluding
     PR
     excise
     tax
     credits)                    16.9%       20.3% (3.4) pts.       13.6%       20.3% (6.7) pts.

    pts: percentage points

    PR: Puerto Rico
    ---------------

Cash Flow and Balance Sheet Discussion

    --  The Company generated $1.6 billion of free cash flow in the fourth
        quarter of 2013. For the full year, free cash flow increased $0.4
        billion to $5.6 billion.
    --  The Company's first quarter 2014 dividend of $0.61 per share declared on
        Dec. 13, 2013, will be paid on Mar. 7, 2014, to all stockholders of
        record as of the close of business on Feb. 13, 2014. This dividend
        represents a 30 percent increase from that paid in each of the previous
        four quarters.
    --  The Company did not repurchase shares in the fourth quarter and has $1.6
        billion remaining under its stock repurchase authorization.


              $Billions, except shares    Q4 '13        Q4 '12  YOY      FY '13  FY '12  YOY  
                                          ------        ------  -----    ------  ------  -----


     Operating
     Cash
     Flow                                    $1.8          $0.8    $1.0     $6.3    $5.9    $0.4

     Capital
     Expenditures                             0.2           0.2     0.0      0.7     0.7     0.0

    Free
     Cash
     Flow                                     1.6           0.6     1.0      5.6     5.2     0.4

     Dividends
     Paid                                     0.4           0.3     0.1      1.4     1.1     0.3

    Cost
     of
     Shares
     Repurchased                              0.0           1.2    (1.2)     0.8     4.7    (3.9)

     Adjusted
     Avg.
     Diluted
     Shares
     (millions)                               766           778     (12)     765     786     (21)


    Cash
     and
     Investments*                            22.8          24.1    (1.3)    22.8    24.1    (1.3)

    Debt
     Outstanding                             32.1          26.5     5.6     32.1    26.5     5.6

     Stockholders'
     Equity                                  22.1          19.1     3.0     22.1    19.1     3.0


                  *                Includes cash, cash
                                   equivalents and
                                   marketable securities,
                                   and long-term
                                   restricted investments.
                                    The impact of the Onyx
                                    acquisition in the
                                   fourth quarter of 2013
                                   was $9.7 billion, net
                                   of Onyx's cash and
                                   investments acquired.
                                   The Onyx acquisition
                                   was partially financed
                                   with $8.1 billion in
                                   bank debt.

                                   Note: Numbers may not
                                   add due to rounding
                                  ----------------------

2014 Guidance

For the full year 2014, the Company expects:

    --  Total revenues to be in the range of $19.2 billion to $19.6 billion and
        adjusted EPS to be in the range of $7.90 to $8.20. This includes an $800
        million incremental operating income contribution due to the end of the
        ENBREL profit share.
    --  Adjusted tax rate to be in the range of 15 percent to 16 percent. This
        assumes the federal R&D credit will be extended for 2014 and also
        includes the impact of the foreign tax credit associated with the Puerto
        Rico excise tax. The Puerto Rico excise tax credit reduces the adjusted
        rate by three to four percentage points.
    --  Capital expenditures to be approximately $800 million.

Fourth Quarter Product and Pipeline Update

Projected milestones for innovative late-stage clinical programs:


           Clinical
            Program           Lead Indication              Milestone        Timing
           --------           ---------------              ---------        ------

          Evolocumab           Dyslipidemia               Phase 3 data      Q1 2014
          ----------           ------------               ------------      -------

          Ivabradine       Chronic heart failure          U.S. filing       H1 2014
          ----------       ---------------------          -----------       -------

          Kyprolis(R)        Multiple myeloma        Phase 3 ASPIRE interim
                                                            analysis*       H1 2014

                                                      Phase 3 FOCUS data*
    ---                                                ------------------

          Talimogene
         laherparepvec      Metastatic melanoma          Phase 3 data***     H1 2014
         -------------      -------------------          -------------      -------

         Blinatumomab     Relapsed/refractory ALL         Phase 2 data      H1 2014
         ------------     -----------------------         ------------      -------

          Trebananib     Recurrent ovarian cancer        Phase 3 data***     H2 2014
          ----------     ------------------------        -------------      -------

         Velcalcetide  Secondary hyperparathyroidism      Phase 3 data      H2 2014

           (AMG 416)
           --------

         Brodalumab**            Psoriasis                Phase 3 data             2014
          -----------            ---------                ------------             ----

        Romosozumab***  Postmenopausal osteoporosis       Phase 3 data      H1 2016
         -------------  ---------------------------       ------------      -------

          Rilotumumab         Gastric Cancer             Phase 3 data*             2016
          -----------         --------------              ------------             ----

* Event driven studies
(**) Overall survival (secondary endpoint)
** Developed in collaboration with AstraZeneca/MedImmune
*** Developed in collaboration with UCB
ALL = acute lymphoblastic leukemia

The company provided the following information on selected clinical programs:

Evolocumab:

    --  The Company discussed pivotal data received from four Phase 3 lipid
        lowering studies in subjects with elevated LDL cholesterol and continues
        to expect the results from a fifth Phase 3 study in the first quarter of
        2014.

Romosozumab:

    --  The Company discussed that it has increased the sample size and
        completed enrollment in its Phase 3 placebo-controlled registrational
        study in women with postmenopausal osteoporosis.

Blinatumomab:

    --  The Company discussed the recent initiation of a Phase 3 study in
        patients with relapsed/refractory B-precursor ALL.

Biosimilars:

    --  The Company announced that it has commenced a pivotal study for its
        biosimilar Avastin(®) (bevacizumab), the third Amgen biosimilar to
        enter a pivotal trial.
    --  The Company announced that enrollment has resumed for its pivotal study
        for biosimilar Herceptin(®) (trastuzumab).

Note: Avastin(®) and Herceptin(®) are products of Genentech/Roche.

Non-GAAP Financial Measures
The Adjusted non-GAAP (U.S. Generally Accepted Accounting Principles) financial measures included above for the three and twelve months ended Dec. 31, 2013 and 2012 exclude, for the applicable periods, certain expenses related to acquisitions, cost-savings initiatives and certain other adjustments, as applicable. These adjustments and other items are presented on the attached reconciliations.

Management has presented its operating results in accordance with GAAP and on an "adjusted" (or non-GAAP) basis and Free Cash Flow which is a non-GAAP financial measure for the three and twelve months ended Dec. 31, 2013 and 2012. In addition, management has presented its full year 2014 EPS and tax rate guidance in accordance with GAAP and on an "adjusted" (or non-GAAP) basis. The Company believes that the presentation of non-GAAP financial measures provides useful supplementary information to and facilitates additional analysis by investors. The Company uses these non-GAAP financial measures in connection with its own budgeting and financial planning. These non-GAAP financial measures are in addition to, not a substitute for, or superior to, measures of financial performance prepared in conformity 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 biologics manufacturing 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 the world's largest independent biotechnology company, has reached millions of patients around the world and is developing a pipeline of medicines with breakaway potential.

For more information, visit www.amgen.com and follow us on www.twitter.com/amgen.

Forward-Looking Statements
This news release contains forward-looking statements that involve significant risks and uncertainties, including those discussed below and others that can be found in our Form 10-K for the year ended Dec. 31, 2012, and in any subsequent periodic reports on Form 10-Q and Form 8-K. 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. The Company's results may be affected by our ability to successfully market both new and existing products domestically and internationally, clinical and regulatory developments (domestic or foreign) involving current and future products, sales growth of recently launched products, competition from other products (domestic or foreign), and difficulties or delays in manufacturing our products. In addition, sales of our products are affected by reimbursement policies imposed by third-party payors, 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 as well as U.S. legislation affecting pharmaceutical pricing and reimbursement. Government and others' regulations and reimbursement policies may affect the development, usage and pricing of our products. 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 after they are on the market. Our business may be impacted by government investigations, litigation and product liability claims. 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. We depend on third parties for a significant portion of our manufacturing capacity for the supply of certain of our current and future products and limits on supply may constrain sales of certain of our current products and product candidate development. In addition, we compete with other companies with respect to some of our marketed products as well as for the discovery and development of new products. Discovery or identification of new product candidates cannot be guaranteed and movement from concept to product is uncertain; consequently, there can be no guarantee that any particular product candidate 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. Our efforts to integrate the operations of companies we have acquired may not be successful. 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.

                                                                                                                           
    Amgen Inc.
                                                                                                                           
    Condensed Consolidated Statements of Income - GAAP
                                                                                                                           
    (In millions, except per share data)
                                                                                                                           
    (Unaudited)
                                                                                                                           
                                                                          
                                     Three months
                                         ended             Years ended
                                                                          
                                     December 31,         December 31,
                                     ------------         ------------
                                                                                                                           
                                               2013                 2012                    2013                     2012
                                               ----                 ----                    ----                     ----
                                                                                                                           
    Revenues:
                                                                                                                           
      Product
       sales                                 $4,799               $4,337                 $18,192                  $16,639
                                                                                                                           
      Other
       revenues                                 212                   84                     484                      626
                                                ---                  ---                     ---                      ---
                                                                                                                           
        Total revenues                        5,011                4,421                  18,676                   17,265
                                              -----                -----                  ------                   ------
                                                                                                                           
                                                                                                                           
    Operating expenses:
                                                                                                                           
      Cost of
       sales                                  1,029                  922                   3,346                    3,199
                                                                                                                           
      Research
       and
       development                            1,249                  938                   4,083                    3,380
                                                                                                                           
      Selling,
       general
       and
       administrative                         1,521                1,373                   5,184                    4,814
                                                                                                                           
      Other                                      25                  100                     196                      295
                                                                                                                           
        Total operating expenses              3,824                3,333                  12,809                   11,688
                                              -----                -----                  ------                   ------
                                                                                                                           
                                                                                                                           
    Operating income                          1,187                1,088                   5,867                    5,577
                                                                                                                           
                                                                                                                           
    Interest expense, net                       261                  291                   1,022                    1,053
                                                                                                                           
    Interest and other income,
     net                                         88                  126                     420                      485
                                                ---                  ---                     ---                      ---
                                                                                                                           
                                                                                                                           
    Income before income taxes                1,014                  923                   5,265                    5,009
                                                                                                                           
                                                                                                                           
    Provision for income taxes                   (7)                 135                     184                      664
                                                                                                                           
                                                                                                                           
    Net income                               $1,021                 $788                  $5,081                   $4,345
                                             ======                 ====                  ======                   ======
                                                                                                                           
                                                                                                                           
    Earnings per share:
                                                                                                                           
      Basic                                   $1.35                $1.03                   $6.75                    $5.61
                                                                                                                           
      Diluted                                 $1.33                $1.01                   $6.64                    $5.52
                                                                                                                           
                                                                                                                           
    Average shares used in
     calculation of earnings per
     share:
                                                                                                                           
      Basic                                     754                  763                     753                      775
                                                                                                                           
      Diluted                                   766                  778                     765                      787


    Amgen Inc.

    Condensed Consolidated Balance Sheets - GAAP

    (In millions)

    (Unaudited)


                                  December 31,           December 31,

                                                    2013                 2012
                                                    ----                 ----

    Assets

    Current assets:

      Cash, cash
       equivalents
       and
       marketable
       securities                                $19,401              $24,061

      Trade
       receivables,
       net                                         2,697                2,518

      Inventories                                  3,019                2,744

      Other current
       assets                                      2,250                1,886
                                                   -----                -----

        Total current
         assets                                   27,367               31,209

    Property, plant
     and equipment,
     net                                           5,349                5,326

    Intangible
     assets, net                                  13,262                3,968

    Goodwill                                      14,968               12,662

    Restricted
     investments                                   3,413                    -

    Other assets                                   1,766                1,133
                                                   -----                -----

    Total assets                                 $66,125              $54,298
                                                 =======              =======


    Liabilities and
     Stockholders'
     Equity

    Current
     liabilities:

      Accounts
       payable and
       accrued
       liabilities                                $5,442               $5,696

      Current
       portion of
       long-term
       debt                                        2,505                2,495

        Total current
         liabilities                               7,947                8,191

    Long-term debt                                29,623               24,034

    Other noncurrent
     liabilities                                   6,459                3,013

    Stockholders'
     equity                                       22,096               19,060
                                                  ------               ------

    Total
     liabilities and
     stockholders'
     equity                                      $66,125              $54,298
                                                 =======              =======



    Shares
     outstanding                                     755                  756

                                                                                               
    Amgen Inc.
                                                                                               
    GAAP to "Adjusted" Reconciliations
                                                                                               
    (In millions)
                                                                                               
    (Unaudited)
                                                                                               
                                                                                               
                                                                                                           
                                                              Three months
                                                                  ended               Years ended
                                                                                                        
                                                              December 31,           December 31,
                                                              ------------           ------------
                                                                                                          
                                                            2013          2012        2013          2012
                                                            ----          ----        ----          ----
                                                                                               
                                                                                               
      GAAP cost of sales                                  $1,029          $922      $3,346        $3,199
                                                                                               
      Adjustments to cost of sales:
                                                                                                          
      Stock option expense (a)                                (3)           (3)         (9)          (12)
                                                                                                          
      Acquisition-related expenses
       (b)                                                  (256)          (74)       (467)         (292)
                                                                                               
      Certain charges pursuant to our
       efforts to improve cost
       efficiencies in our operations
       related to accelerated
       depreciation of certain
       manufacturing facilities                                -          (118)          -          (160)
                                                                                                          
      Total adjustments to cost of
       sales                                                (259)         (195)       (476)         (464)
                                                                                               
      Adjusted cost of sales                                $770          $727      $2,870        $2,735
                                                            ====          ====      ======        ======
                                                                                               
                                                                                               
                                                                                               
      GAAP research and development
       expenses                                           $1,249          $938      $4,083        $3,380
                                                                                               
      Adjustments to research and development expenses:
                                                                                                          
      Stock option expense (a)                                (2)           (5)        (12)          (22)
                                                                                                          
      Acquisition-related expenses
       (c)                                                   (79)          (16)       (142)          (50)
                                                                                               
      Certain charges pursuant to our
       efforts to improve cost
       efficiencies in our operations
       related to a lease abandonment                          -             -           -           (12)
                                                                                                          
      Total adjustments to research
       and development expenses                              (81)          (21)       (154)          (84)
                                                                                               
      Adjusted research and
       development expenses                               $1,168          $917      $3,929        $3,296
                                                          ======          ====      ======        ======
                                                                                               
                                                                                               
                                                                                               
      GAAP selling, general and
       administrative expenses                            $1,521        $1,373      $5,184        $4,814
                                                                                               
      Adjustments to selling, general and administrative
       expenses:
                                                                                                          
      Stock option expense (a)                                (3)           (5)        (13)          (25)
                                                                                                          
      Acquisition-related expenses
       (d)                                                  (212)          (17)       (266)          (72)
                                                                                                          
      Total adjustments to selling,
       general and administrative
       expenses                                             (215)          (22)       (279)          (97)
                                                                                               
      Adjusted selling, general and
       administrative expenses                            $1,306        $1,351      $4,905        $4,717
                                                          ======        ======      ======        ======
                                                                                               
                                                                                               
                                                                                               
      GAAP operating expenses                             $3,824        $3,333     $12,809       $11,688
                                                                                            
      Adjustments to
       operating expenses:
                                                                                                          
      Adjustments to cost of sales                          (259)         (195)       (476)         (464)
                                                                                                          
      Adjustments to research and
       development expenses                                  (81)          (21)       (154)          (84)
                                                                                                          
      Adjustments to selling, general
       and administrative expenses                          (215)          (22)       (279)          (97)
                                                                                                          
      Expense resulting from changes
       in the estimated fair values of
       the contingent consideration
       obligations related to a prior
       year business combination                              (2)          (26)       (113)          (31)
                                                                                                          
      Acquisition-related expenses
       (e)                                                     2            (6)          2           (25)
                                                                                                          
      Certain charges pursuant to our
       efforts to improve cost
       efficiencies in our operations
       (f)                                                   (25)          (69)        (71)         (175)
                                                                                               
      Benefit/(Expense) related to
       various legal proceedings                               -             1         (14)          (64)
                                                                                                          
      Total adjustments to operating
       expenses                                             (580)         (338)    (1,105)          (940)
                                                                                               
      Adjusted operating expenses                         $3,244        $2,995     $11,704       $10,748
                                                          ======        ======     =======       =======
                                                                                               
                                                                                               
                                                                                               
      GAAP income before income taxes                     $1,014          $923      $5,265        $5,009
                                                                                               
      Adjustments to income before income taxes:
                                                                                                          
      Adjustments to operating
       expenses                                              580           338       1,105           940
                                                                                               
      Non-cash interest expense
       associated with our convertible
       notes                                                   -            36          12           140
                                                                                               
      Bridge financing costs
       associated with the Onyx
       business combination                                    -             -          22             -
                                                                                                          
      Total adjustments to income
       before income taxes                                   580           374       1,139         1,080
                                                                                               
      Adjusted income before income
       taxes                                              $1,594        $1,297      $6,404        $6,089
                                                          ======        ======      ======        ======
                                                                                               
                                                                                               
                                                                                               
      GAAP provision for income taxes                        $(7)         $135        $184          $664
                                                                                               
      Adjustments to provision for income taxes:
                                                                                                          
      Income tax effect of the above
       adjustments (g)                                       228            97         376           329
                                                                                                          
      Other income tax adjustments (h)                       (18)          (23)         30           (23)
                                                                                                          
      Total adjustments to provision
       for income taxes                                      210            74         406           306
                                                                                               
      Adjusted provision for income
       taxes                                                $203          $209        $590          $970
                                                            ====          ====        ====          ====
                                                                                               
                                                                                               
                                                                                               
      GAAP net income                                     $1,021          $788      $5,081        $4,345
                                                                                               
      Adjustments to net income:
                                                                                                          
      Adjustments to income before
       income taxes, net of the tax
       effect of the above adjustments                       352           277         763           751
                                                                                                          
      Other income tax adjustments (h)                        18            23         (30)           23
                                                                                                          
      Total adjustments to net income                        370           300         733           774
                                                                                               
      Adjusted net income                                 $1,391        $1,088      $5,814        $5,119
                                                          ======        ======      ======        ======



    Amgen Inc.

    GAAP to "Adjusted" Reconciliations

    (In millions, except per share data)

    (Unaudited)



                   The following table presents the computations for
                   GAAP and "Adjusted" diluted EPS, computed under
                   the treasury stock method.

                   "Adjusted" EPS presented below excludes stock
                   option expense:


                                                        Three months
                                                            ended                         Three months ended

                                                     December 31, 2013                    December 31, 2012
                                                     -----------------                    -----------------

                                                           GAAP        "Adjusted"                  GAAP         "Adjusted"
                                                           ----        ----------                  ----         ----------

                  Income (Numerator):

                   Net income for basic and diluted
                   EPS                                        $1,021              $1,391                  $788             $1,088
                                                              ======


                  Shares (Denominator):

                    Weighted-average shares for
                     basic EPS                                   754                 754                   763                763

                    Effect of dilutive securities*                12                  12                    15                 15

                    Weighted-average shares for
                     diluted EPS                                 766                 766                   778                778
                                                                 ===


                  Diluted EPS                                  $1.33               $1.82                 $1.01              $1.40
                                                               =====


                                                         Year ended                           Year ended

                                                     December 31, 2013                    December 31, 2012
                                                     -----------------                    -----------------

                                                           GAAP        "Adjusted"                  GAAP         "Adjusted"
                                                           ----        ----------                  ----         ----------

                  Income (Numerator):

                   Net income for basic and diluted
                   EPS                                        $5,081              $5,814                $4,345             $5,119
                                                              ======


                  Shares (Denominator):

                    Weighted-average shares for
                     basic EPS                                   753                 753                   775                775

                    Effect of dilutive securities*                12                  12                    12                 11

                    Weighted-average shares for
                     diluted EPS                                 765                 765                   787                786
                                                                 ===


                  Diluted EPS                                  $6.64               $7.60                 $5.52              $6.51
                                                               =====


                   *Dilutive securities used to compute "Adjusted"
                   diluted EPS were computed assuming that we do
                   not expense stock options.


         (a)       For the three months and year ended December 31,
                   2013, the total pre-tax expense for employee
                   stock options was $8 million and $34 million,
                   respectively, compared with $13 million and $59
                   million for the corresponding periods of the
                   prior year.


                   "Adjusted" diluted EPS including the impact of
                   stock option expense were as follows:


                                                        Three months
                                                            ended                             Years ended

                                                        December 31,                         December 31,
                                                        ------------                         ------------

                                                                2013                2012                  2013               2012
                                                                ----                ----                  ----               ----


                   "Adjusted" diluted EPS,
                   excluding stock option expense              $1.82               $1.40                 $7.60              $6.51


                   Impact of stock option expense
                   (net of tax)                                (0.01)              (0.01)                (0.03)             (0.06)
                                                              ------


                   "Adjusted" diluted EPS,
                   including stock option expense              $1.81               $1.39                 $7.57              $6.45
                                                               =====


         (b)       The adjustments related primarily to non-cash
                   amortization of developed product technology
                   rights acquired in business combinations,
                   including $176 million in 2013 related to Onyx.


         (c)       For the three months ended December 31, 2013, the
                   adjustments related primarily to charges
                   associated with the Onyx business combination,
                   which included the acceleration of Onyx unvested
                   equity compensation (Onyx equity compensation).
                   The three months and year ended December 31,
                   2013, also included adjustments related
                   primarily to non-cash amortization of
                   intangible assets acquired in prior year
                   business combinations. The adjustments in 2012
                   related primarily to non-cash amortization of
                   intangible assets as well as retention and
                   severance expenses.


         (d)       The adjustments in 2013 related primarily to the
                   Onyx equity compensation. Both 2013 and 2012
                   included non-cash amortization of intangible
                   assets acquired in prior year business
                   combinations as well as business combination
                   transaction costs.


         (e)       The adjustments in 2012 related primarily to the
                   write-off of a non-key intangible asset
                   acquired in a prior year business combination.


         (f)       The adjustments in 2013 and the three months
                   ended December 31, 2012, related primarily to
                   severance expenses. For the year ended December
                   31, 2012, the adjustments related primarily to
                   severance expenses and lease abandonment costs.


         (g)       The tax effect of the adjustments between our
                   GAAP and "Adjusted" results takes into account
                   the tax treatment and related tax rate(s) that
                   apply to each adjustment in the applicable tax
                   jurisdiction(s). Generally, this results in a
                   tax impact at the U.S. marginal tax rate for
                   certain adjustments, including the majority of
                   amortization of intangible assets, whereas the
                   tax impact of other adjustments, including stock
                   option expense, depends on whether the amounts
                   are deductible in the tax jurisdictions where
                   the expenses are incurred or the asset is
                   located and the applicable tax rate(s) in those
                   jurisdictions. Due to these factors, the
                   effective tax rates for the adjustments to our
                   GAAP income before income taxes, for the three
                   months and year ended December 31, 2013, were
                   39.3% and 33.0%, respectively, compared with
                   25.9% and 30.5% for the corresponding periods of
                   the prior year.


         (h)       For the three months ended December 31, 2013, the
                   adjustments related primarily to certain prior
                   period items excluded from adjusted earnings.
                   For the year ended December 31, 2013, the
                   adjustments related to resolving certain non-
                   routine transfer-pricing and acquisition-
                   related issues with tax authorities as well as
                   the impact related to certain prior period items
                   excluded from adjusted earnings. The adjustments
                   in 2012 related to certain prior period items
                   excluded from adjusted earnings.


    Note:          The 2012 expenses related to amortization of
                   certain acquired intangible assets within
                   operating expenses have been reclassified to
                   conform to the current year presentation.

                                                                                                                          
    Amgen Inc.
                                                                                                                          
    Reconciliation of Free Cash Flow
                                                                                                                          
    (In millions)
                                                                                                                          
    (Unaudited)
                                                                                                                          
                                                                             
                                             Three                 Years
                                             months                ended
                                             ended
                                                                             
                                            December              December
                                              31,                   31,
                                           ---------             ---------
                                                                                                                          
                                                 2013                  2012                  2013                   2012
                                                 ----                  ----                  ----                   ----
                                                                                                            
      Cash Flows
       from
       Operations                $1,835                  $812                $6,291                 $5,882
                                                                                                            
      Capital
       Expenditures                (201)                 (200)                 (693)                  (689)
                                                                                                            
      Free Cash
       Flow                      $1,634                  $612                $5,598                 $5,193
                                   ====                  ====                  ====                 ======



    Reconciliation of GAAP EPS Guidance to "Adjusted"

    EPS Guidance for the Year Ending December 31, 2014

    (Unaudited)


                                                        2014
                                                        ----


    GAAP diluted EPS guidance                          $6.89 - $7.19


    Known adjustments to arrive at "Adjusted"
     earnings*:

                          Acquisition-
                          related
                          expenses        (a)           1.00

                          Stock
                          option
                          expense                       0.01


    "Adjusted" diluted EPS guidance                    $7.90 - $8.20
                                                       ===== = =====



                                         The known
                                         adjustments
                                         are
                                         presented
                                         net of
                                         their
                                         related
                                         tax impact
                                         which
                                         amount to
                                         approximately
                                         $0.56 per
                                         share in
                                         the
    *                                    aggregate.


                                         To exclude
                                         acquisition-
                                         related
                                         expenses
                                         related
                                         primarily
                                         to non-
                                         cash
                                         amortization
                                         of
                                         intangible
                                         assets
                                         acquired
                                         in prior
                                         year
                                         business
    (a)                                  combinations.


    Reconciliation of GAAP Tax Rate Guidance to
     "Adjusted"

    Tax Rate Guidance for the Year Ending
     December 31, 2014

    (Unaudited)



                                                          2014
                                                          ----


    GAAP tax rate guidance                                  11% -          12%


                            Tax rate
                            effect of
                            known
                            adjustments
                            discussed
                            above                            4%



    "Adjusted" tax rate guidance                            15% -          16%
                                                           ===  =         ===

CONTACT: Amgen, Thousand Oaks
Ashleigh Koss, 805-313-6151 (media)
Arvind Sood, 805-447-1060 (investors)

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SOURCE Amgen