Amgen faces significant financial risks from ongoing legal proceedings, particularly tax disputes with the IRS, potentially resulting in substantial additional tax liabilities. Reimbursement pressures from government and commercial payers, including price controls and rebates, threaten profitability. Changes in U.S. and international reimbursement policies, and state-level actions, also pose risks to sales and pricing. Cybersecurity breaches and system outages could disrupt operations and expose sensitive data.
Financial Upside
Amgen's product sales increased 24% in the three months and 22% in the nine months ended September 30, 2024, driven by volume growth. The Horizon acquisition contributed significantly to this growth, with new products like TEPEZZA and KRYSTEXXA generating substantial revenue. Unrealized gains on strategic investments, like BeiGene, also contributed to positive income. Amgen maintains a substantial cash balance and intends to continue investing in innovation, reducing debt, and returning capital to shareholders through dividends and stock repurchases.
