Amgen (Nasdaq: AMGN) reported adjusted earnings per share (EPS) of $1.38 for the second quarter of 2010, an increase of 7 percent compared to $1.29 for the second quarter of 2009. Adjusted net income increased 1 percent to $1,326 million for the second quarter of 2010 compared to $1,311 million for the second quarter of 2009.
Total revenue increased 2 percent for the second quarter of 2010 to $3,804 million versus $3,713 million for the second quarter of 2009.
“We delivered a solid quarter,” said Kevin Sharer, chairman & CEO. “We are in the process of launching Prolia worldwide and look forward to working with global regulatory authorities to gain approval for denosumab in patients with advanced cancer.”
Adjusted EPS and adjusted net income for the second quarter of 2010 and 2009 exclude, for the applicable periods, stock option expense, certain expenses related to acquisitions, non-cash interest expense resulting from a change in accounting in the first quarter of 2009 for our convertible notes, the income tax benefit as a result of resolving certain non-routine transfer pricing issues with the Internal Revenue Service (“IRS”) and certain other items. These adjustments and other items are presented on the attached reconciliation tables.
On a reported basis and calculated in accordance with United States (U.S.) Generally Accepted Accounting Principles (GAAP), Amgen’s GAAP diluted EPS were $1.25 for the second quarter of 2010, unchanged from the second quarter of 2009. GAAP net income decreased 5 percent to $1,202 million for the second quarter of 2010 from $1,269 million for the second quarter of 2009. GAAP net income for the second quarter of 2009 was positively impacted by $115 million as a result of resolving certain non-routine transfer pricing issues with the IRS.
Product Sales Performance
Total product sales for the second quarter of 2010 decreased 1 percent to $3,613 million from $3,634 million for the second quarter of 2009. Sales in the U.S. totaled $2,787 million, a decrease of 2 percent versus $2,833 million for the second quarter of 2009. Second quarter 2010 U.S. product sales include a $45 million unfavorable impact for certain U.S. Health Care Reform Legislation provisions that were in effect during the second quarter, partially offset by a $9 million favorable adjustment related to changes in accounting estimates with respect to the accruals for U.S. Health Care Reform Legislation recorded in the first quarter of 2010. International sales increased 3 percent to $826 million versus $801 million for the second quarter of 2009. Changes in foreign exchange positively impacted second quarter 2010 sales by $11 million. Excluding the favorable impact of foreign exchange, total product sales decreased 1 percent and international product sales increased 2 percent.
Worldwide sales of Aranesp® (darbepoetin alfa) decreased 13 percent to $603 million in the second quarter of 2010 versus $693 million for the second quarter of 2009. In the U.S., Aranesp sales decreased 21 percent to $267 million for the second quarter of 2010 versus $338 million for the second quarter of 2009. The decrease was driven by a decline in demand. The decline in demand was due to a decrease in units sold reflecting an overall decline in the segment, and to a lesser extent, a slight loss of segment share. International Aranesp sales decreased 5 percent to $336 million versus $355 million in the second quarter of 2009 due to a decrease in demand reflecting an overall decline in the segment. Excluding the favorable impact of foreign exchange of $3 million, worldwide Aranesp sales decreased 13 percent and international product sales decreased 6 percent.
Sales of EPOGEN® (Epoetin alfa) increased 3 percent to $657 million in the second quarter of 2010 versus $638 million in the second quarter of 2009, primarily due to an increase in demand and favorable changes in wholesaler inventories. The increase in demand was principally due to patient population growth, partially offset by a decrease in dose utilization.
Combined worldwide sales of Neulasta® (pegfilgrastim) and NEUPOGEN® (Filgrastim) increased 1 percent to $1,174 million in the second quarter of 2010 versus $1,158 million for the second quarter of 2009. Combined sales of Neulasta and NEUPOGEN in the U.S. were $868 million in the second quarter of 2010 versus $855 million in the second quarter of 2009, an increase of 2 percent due primarily to favorable changes in wholesaler inventories, partially offset by a low single-digit percentage point decrease in demand. The decrease in demand was driven by a decline in units sold, partially offset by a mid single-digit percentage point increase in average net sales price. Combined international sales increased 1 percent to $306 million in the second quarter of 2010 versus $303 million for the second quarter of 2009. This increase was primarily driven by the positive impact of changes in foreign exchange of $5 million. This increase was partially offset by a slight decrease in demand. Excluding the impact of foreign exchange, combined worldwide product sales of NEUPOGEN and Neulasta increased 1 percent and international product sales decreased 1 percent.
Sales of Enbrel® (etanercept) decreased 2 percent in the second quarter of 2010 to $877 million versus $899 million for the second quarter of 2009, driven by a decrease in demand. The decrease in demand was principally due to a mid single-digit percentage point decline in units sold reflecting a share decline primarily as a result of increased competitive activity in dermatology, partially offset by an increase in average net sales price. ENBREL continues to maintain a leading position in both the rheumatology and dermatology segments.
Worldwide sales of Sensipar® (cinacalcet) increased 3 percent to $172 million in the second quarter of 2010 versus $167 million during the second quarter of 2009, primarily as a result of increased demand, partially offset by unfavorable changes in U.S. wholesaler inventories.
Vectibix® (panitumumab) sales for the second quarter of 2010 were $72 million compared to $56 million for the second quarter of 2009. Sales growth was driven by international demand partially as a result of recent launches.
Operating Expense Analysis on an Adjusted Basis: