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THOUSAND OAKS, Calif., Aug. 4, 2022 /PRNewswire/ -- Amgen (NASDAQ:AMGN) today announced financial results for the second quarter of 2022. Key results include:

• Total revenues increased 1% to $6.6 billion in comparison to the second quarter of 2021, resulting from 3% growth in global product sales partially offset by lower Other Revenue from our COVID-19 manufacturing collaboration.
• Volumes grew double-digits for a number of products including Repatha^® (evolocumab), Prolia^® (denosumab), LUMAKRAS^®/LUMYKRAS™ (sotorasib) and EVENITY^® (romosozumab-aqqg).
• GAAP earnings per share (EPS) increased from $0.81 to $2.45 driven by a decrease in operating expenses due to the write-off of $1.5 billion in Acquired In-Process Research & Development (Acquired IPR&D) associated with our acquisition of Five Prime Therapeutics in Q2 2021 and lower weighted-average shares outstanding in Q2 2022, partially offset by an impairment charge related to the divestiture of GENSENTA, a generics subsidiary in Turkey.
• GAAP operating income increased from $0.8 billion to $2.2 billion, and GAAP operating margin increased 21.1 percentage points to 34.6%.
• Non-GAAP EPS increased from $1.77 to $4.65 driven by a decrease in operating expenses due to the write-off of $1.5 billion in Acquired IPR&D associated with our acquisition of Five Prime Therapeutics in Q2 2021 and lower weighted-average shares outstanding in Q2 2022.
• Non-GAAP operating income increased from $1.6 billion to $3.3 billion, and non-GAAP operating margin increased 26.8 percentage points to 53.1%.
• The Company generated $1.7 billion of free cash flow for the second quarter versus $1.7 billion in the second quarter of 2021.
• 2022 total revenues guidance revised to $25.5-$26.4 billion; EPS guidance revised to $11.01-$12.15 on a GAAP basis, and reaffirmed at $17.00-$18.00 on a non-GAAP basis.

"We are focused on delivering our long-term objectives by serving an ever-increasing number of patients around the world with our medicines," said Robert A. Bradway, chairman and chief executive officer. "We are advancing our pipeline and look forward to important readouts over the next few months."

Non-GAAP EPS has been recast due to an update to our non-GAAP policy effective January 1, 2022, resulting in a $2.61 reduction of previously-reported non-GAAP EPS for the second quarter of 2021.  Refer to Non-GAAP Financial Measures below for further discussion.

References in this release to "non-GAAP" measures, measures presented "on a non-GAAP basis" and "free cash flow" (computed by subtracting capital expenditures from operating cash flow) refer to non-GAAP financial measures. Beginning January 1, 2022, the Company's non-GAAP financial measures no longer exclude adjustments for upfront license fees, development milestones and IPR&D expenses of pre-approval programs related to licensing, collaboration and asset acquisition transactions. For purposes of comparability, the non-GAAP financial results for the second quarter of 2021 have been updated to reflect this change. Adjustments to the most directly comparable GAAP financial measures and other items are presented on the attached reconciliations. Refer to Non-GAAP Financial Measures below for further discussion.

Product Sales Performance

Total product sales increased 3% for the second quarter of 2022 versus the second quarter of 2021. Unit volumes grew 10%, partially offset by 6% lower net selling price and 2% negative impact from foreign exchange.

General Medicine

• Prolia^® sales increased 13% year-over-year for the second quarter, primarily driven by 12% volume growth.
• EVENITY^® sales increased 46% year-over-year to a record $191 million for the second quarter, driven by strong volume growth across our markets. U.S. sales grew 65% year-over-year, driven by 60% volume growth. Outside the U.S., EVENITY sales grew 17%, driven by 37% volume growth, partially offset by foreign exchange impact.
• Repatha^® sales increased 14% year-over-year for the second quarter, driven by 55% volume growth, partially offset by lower net selling price. In the U.S., sales grew 8%, driven by 38% 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 20%. Repatha remains the global proprotein convertase subtilisin/kexin type 9 (PCSK9) segment leader, with over 1.1 million patients treated since launch.
• Aimovig^® (erenumab-aooe) sales increased 12% year-over-year for the second quarter, primarily driven by higher net selling price, partially offset by a 11% decline in volume.

Inflammation

• TEZSPIRE^® (tezepelumab-ekko) generated $29 million of sales in the second quarter, driven by strong adoption by both allergists and pulmonologists across all severe asthma patient types. Healthcare providers acknowledge TEZSPIRE's unique, differentiated profile and its broad potential to treat the 2.5 million patients worldwide with severe asthma who are uncontrolled or biologic eligible, without any phenotypic and biomarker limitation.
• Otezla^® (apremilast) sales increased 11% year-over-year for the second quarter, driven by 8% volume growth and favorable changes to estimated sales deductions, partially offset by lower net selling price. In the U.S., total prescription (TRx) volumes grew 12% year-over-year and new-to-brand prescriptions (NBRx) grew 18% year-over-year, supported by broader adoption of Otezla among patients with mild-to-moderate psoriasis. We expect continued volume growth in the second half of 2022 given our unique, broad indication to treat patients suffering from mild, moderate or severe psoriasis.
• Enbrel^® (etanercept) sales decreased 8% year-over-year for the second quarter, primarily driven by lower net selling price and a 3% decline in volume. Going forward, we expect net selling price to continue to decline year-over-year, driven by increased competition.
• AMGEVITA™ (adalimumab) sales increased 8% year-over-year for the second quarter, driven by 32% volume growth, partially offset by foreign exchange impact and lower net selling price resulting from increased competition. AMGEVITA continued to be the most prescribed adalimumab biosimilar in Europe.

Hematology-Oncology

• LUMAKRAS^®/LUMYKRAS™ (sotorasib) generated $77 million of sales for the second quarter, representing 24% quarter-over-quarter growth. In the U.S., LUMAKRAS has been prescribed to over 3,000 patients by over 1,900 physicians in both academic and community settings. Outside the U.S., LUMYKRAS has now been approved in over 40 countries around the world. We are actively launching in 25 markets and pursuing reimbursement in the remaining countries.
• KYPROLIS^® (carfilzomib) sales increased 13% year-over-year for the second quarter, driven by 19% volume growth, partially offset by lower net selling price.
• XGEVA^® (denosumab) sales increased 9% year-over-year for the second quarter, driven by higher net selling price and favorable changes to estimated sales deductions. Volume remained flat year-over-year in the second quarter.
• Vectibix^® (panitumumab) sales decreased 13% year-over-year for the second quarter driven by the timing of shipments to Takeda, our partner in Japan, in the second quarter of 2021. In the U.S., sales increased 4% year-over-year, driven by volume growth.
• Nplate^® (romiplostim) sales increased 16% year-over-year for the second quarter, primarily driven by 11% volume growth and higher net selling price.
• BLINCYTO^® (blinatumomab) sales increased 29% year-over-year for the second quarter, driven by volume growth.
• MVASI^® sales decreased 17% year-over-year for the second quarter, driven by lower net selling price that was partially offset by 10% volume growth. In the U.S., MVASI continued to hold leading volume share with 49% of the bevacizumab segment for the quarter. The most recently published Average Selling Price (ASP) for MVASI in the U.S. declined 39% year-over-year and 21% quarter-over-quarter. Looking forward, we expect continued net selling price erosion and declining volume driven by increased competition and continued ASP erosion.
• KANJINTI^® (trastuzumab-anns) sales decreased 46% year-over-year for the second quarter, primarily driven by declines in net selling price and volume. In the U.S., KANJINTI continued to hold leading volume share with 41% of the trastuzumab segment in the quarter. The most recently published ASP for KANJINTI in the U.S. declined 43% year-over-year and 21% quarter-over-quarter. Going forward, we expect continued net selling price deterioration and volume declines driven by increased competition and continued ASP erosion.

Established Products

• Total sales of our established products, which include Neulasta^® (pegfilgrastim), NEUPOGEN^® (filgrastim), EPOGEN^® (epoetin alfa), Aranesp^® (darbepotein alfa), Parsabiv^® (etelcalcetide), and Sensipar^®/Mimpara™ (cinacalcet), decreased 15% year-over-year for the second quarter, primarily driven by lower net selling price. In the second quarter, the published ASP for Neulasta in the U.S. declined 35% year-over-year and 9% quarter-over-quarter. In the aggregate, we expect the year-over-year net selling price and volume erosion for this portfolio of products to continue.

Product Sales Detail by Product and Geographic Region

Operating Expense, Operating Margin and Tax Rate Analysis

On a GAAP basis:

• Total Operating Expenses decreased 22%. Cost of Sales margin decreased 2.8 percentage points primarily driven by lower COVID-19 antibody shipments and lower manufacturing costs, partially offset by unfavorable product mix. Research & Development (R&D) expenses decreased 4% primarily due to lower marketed product support, partially offset by higher spend in research and early pipeline. Acquired IPR&D expenses were zero in Q2 2022, compared to $1.5 billion in Q2 2021 due to the Five Prime Therapeutics acquisition. Selling, General & Administrative (SG&A) expenses decreased 4%. R&D and SG&A expenses were also impacted by lower acquisition-related expenses from Five Prime Therapeutics.
• Operating Margin as a percentage of product sales increased 21.1 percentage points to 34.6%.
• Tax Rate decreased 2.8 percentage points primarily due to the Five Prime Therapeutics non-deductible IPR&D expense in the prior year, partially offset by the impact of current year net unfavorable items, including an increase in the interest expense on tax reserves and the tax impact of the GENSENTA impairment charge.

On a non-GAAP basis:

• Total Operating Expenses decreased 34%. Cost of Sales margin decreased 2.2 percentage points primarily driven by lower COVID-19 antibody shipments and lower manufacturing costs, partially offset by unfavorable product mix. R&D expenses decreased 2% primarily due to lower marketed product support, partially offset by higher spend in research and early pipeline. Acquired IPR&D expenses were zero in Q2 2022, compared to $1.5 billion in Q2 2021 due to the Five Prime Therapeutics acquisition. SG&A expenses decreased 2%.
• Operating Margin as a percentage of product sales increased 26.8 percentage points to 53.1%.
• Tax Rate decreased 11.6 percentage points primarily due to the Five Prime Therapeutics non-deductible IPR&D expense in the prior year.

$Millions, except percentages		GAAP						Non-GAAP
		Q2 '22		Q2 '21		YOY ?		Q2 '22		Q2 '21		YOY ?
Cost of Sales		$ 1,510		$ 1,637		(8 %)		$    926		$ 1,034		(10 %)
% of product sales		24.0 %		26.8 %		(2.8) pts		14.7 %		16.9 %		(2.2) pts
Research & Development		$ 1,039		$ 1,082		(4 %)		$ 1,020		$ 1,036		(2 %)
% of product sales		16.5 %		17.7 %		(1.2) pts		16.2 %		16.9 %		(0.7) pts
Acquired IPR&D		$      —		$ 1,505		NM		$      —		$ 1,505		NM
% of product sales		— %		24.6 %		NM		— %		24.6 %		NM
Selling, General & Administrative		$ 1,327		$ 1,384		(4 %)		$ 1,313		$ 1,345		(2 %)
% of product sales		21.1 %		22.6 %		(1.5) pts		20.9 %		22.0 %		(1.1) pts
Other		$    542		$      90		*		$      —		$      —		NM
Total Operating Expenses		$ 4,418		$ 5,698		(22 %)		$ 3,259		$ 4,920		(34 %)
Operating Margin
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