amgen presentation

8/18/2019 Amgen Presentation

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Amgen

Team 2: Joshua Zamarron, James Stariha

Elizabeth Allen, Michael Johnson

Michael Mullin


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Industry AnalysisStrong growth rate

arriers to Enter

!om"etition

Threat o# Substitutes

$ower o# uyers

%rowth&$ro't $otential


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%rowth (ateEstimated mar)et *alue in 2+- is ./01 illion

%o*ernment Initiati*es

Increased (esearch and e*elo"ment #unding

!ountries becoming ma3or mar)ets

!hina, India, Euro"e

Mergers and Ac4uisitionAmgen and Immune5


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arriers to Enter6i)elihood is wea)

Ma3ority startu"s are s"in o7s

ased on inno*ati*e "roducts o# "rocesses

resulting #rom disco*eries in academic research6ong start u" "eriods with little "ro't

8igh '5ed costs

9ot enough #unding research and de*elo"ment;%o*ernment (egulations


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!om"etitionMore than ,+++ iotech com"anies in 9orth

America

To" < o# these com"anies ma)ing ma3ority o#

re*enue

!om"etition #or "atents

%ood #or Industry


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uyer $ower(anges #rom 8ealthcare "ro*iders to #armers

and growers

Amgen

8ealthcare "ro*iders8os"itals

S"ecialized "roducts don=t allow #or much buyer"ower


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%rowth&$ro't $otential

Mar)et >alue ./01 illion


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En*ironmental Threat and?""ortunity $ro'le ET?$;

An en*ironmental threat and o""ortunity "ro'le is adescri"tion o# the structure o# e5ternal #actors@

Multi"le (easons #or an ET?$

@ It hel"s the organization to identi#y o""ortunities and threats

2@ !onsolidates and strengthens an organization=s "osition

1@ $ro*ides strategists in#ormation on which sectors ha*e a#a*orable im"act on the organization

/@ The organization gains )nowledge o# its standing withres"ect to its en*ironment

0@ 8el"s #ormulate strategies@


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Ste"s in an ET?$@ Identi#y ma3or En*ironmental #actors such as:

economic, "olitical, social, technological,com"etiti*e, geogra"hical, etc@

2@ En*ironmental #actors are then subdi*ided intosubsectors o# each #actor@

1@ These #actors are then analyzed to determinema3or wea)nesses and strengths in each o# the

subsectors@

/@ The im"act o# each #actor is then accessed asbeing either #a*orable, un#a*orable, or neutral@


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Economic BactorsEconomic #actors a7ect the "urchasing "ower o#

"otential customers and the 'rm=s cost o# ca"ital@

These #actors include: business cycle, inCationarytrends, consum"tion, em"loyment, in*estment,

monetary, and 'scal "olicies@

E5": The most recent 'scal "olicy e*ent that hasha""ened, is that buried within the Biscal !li7 Section-12, is a clause that delays Medicare "rice restraints on

a class o# drugs including Sensi"ar@ This "ro*ision leadsto Amgen ha*ing two more years to sell Sensi"arwithout go*ernmental controls@ The delay o# Medicare"rice restraints has a "ositi*e e7ect on Amgen@


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$olitical Bactors$olitical #actors are how and to what degree

go*ernment inter*enes in the economy@

$olitical #actors include: "olitical "ower, ideologies,interest grou"s, social stability, legislation, andregulation@

E5": ?ne o# the most recent and contro*ersiallegislations "assed was the Dnited States health carere#orm@ Amgen e5"ects a drastic increase o#

com"etition in #uture years due to this legislation@ Thelegislation allows the a""ro*al o# biosimilars, genericbiotech drugs, to ta)e signi'cantly shorter time


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Social BactorsSocial #actors im"act an organization due to the

social, cultural, demogra"hic, and en*ironmental"ro'les in the industry@

Social #actors include: age distribution, geogra"hicdistribution, income distribution, mobility, education,#amily *alues, and business attitudes@

Amgen stri*es to encourage a high"er#ormingen*ironment where team members embrace thetalents and bac)grounds o# each other as well asnourish inno*ati*e thin)ing, and achie*e their #ullability and "otential that leads to Amgen=s success@


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Technological Bactors Technological #actors im"act how an organization or

com"any o"erates in relation to e4ui"ment used inthe com"any=s en*ironment@

Technological Bactors include: rate o# technologicalchange, #uture raw material a*ailability, rawmaterial cost, technological de*elo"ments, and"roduct li#e cycle@

!E? (obert radway announced during a lecture atMIT that he belie*es the com"any is on the cus" o#a ma3or change in how we manu#acture "roteins@F


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%eogra"hical Bactors%eogra"hical Bactors are im"ortant to the o*erall

analysis o# a com"any@

%eogra"hical #actors include: "lant&warehouse

location, relocation o# #acilities, head4uarters, and#oreign mar)ets@

Although the Dnited States mar)ets contribute tomore than G0< o# Amgen=s Annual re*enues,

Amgen has been wor)ing to increase its reach ininternational and #oreign mar)ets@ The com"any hase5tended its "roducts to highgrowth regions suchas Ja"an, !hina, (ussia, and A#rica@


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Amgen SH?T AnalysisStrengths Weaknesses

•E5"ertise in ( o# "roteinthera"eutics hel"ed Amgen buildstrong "roduct "ort#olio•9eulasta, 9eu"ogen and Enbreldri*ing Amgen=s to"line growth•Strong I$( "osition enablingAmgen to o7set biosimilar•(estructuring initiati*es dri*ing

signi'cant "ro't growth during a"eriod o# declining sales

•eclining sales o# Aranes" and

E"ogen•iscontinuation o# late stageclinical trials•(elati*ely low le*els o#technology di*ersi'cationincreasing de"endency on

thera"eutic "roteins

?""ortunity Threats

E5"anding $rolia #ranchise coulddri*e to"line growth, and reduceAmgen=s de"endency on "rotein

thera"euticsAc4uisitions could strengthenAmgen=s "i"elineBocus on the emerging economies"ro*iding growth o""ortunities!ollaboration with Hatson couldhel" Amgen enter oncology

biosimilars mar)et

•A7yma5=s ?montys li)ely toa7ect Aranes" and E"ogensales•!ost containment measuresmay a7ect Amgen=s salesgrowth


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StrengthsE5"ertise in (

To" o# industry

rea)throughs in $E%ylation and %lycosylationtechni4ues increased drug e7ecti*eness

irectly res"onsible #or de*elo"ment o# ne5t strength

9eulasta, 9eu"ogen, and Enbrel dri*ing to"line growth

e*elo"ed #rom $E%ylation and %lycosylation techni4ues#rom 1/ hrs to 0+ hrs;

Amgen=s to" three "roducts contributing to o*er 00< o#re*enues

9eulasta&9eu"ogen .0@2 billion in sales 2+


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StrengthsStrong I$( "osition enabling Amgen to o7set

biosimilar com"etition

8ighly inno*ati*e industry and "rotecting"ro"rietary "ro"erty is essential

Strong ( means nothing i# it is not "rotected

Success#ully de#ended "ro"erty numerous timesincluding + claims o# in#ringement on / o#Amgen=s E$? "atents that led to a "ermanent

in3unction against Swiss big $harma (oche #rome*er selling its "roducts in the DS


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Hea)nesseseclining sales o# Aranes" and E"ogen

!oncerns raised about sa#ety o# the drugs

BA issued blac) bo5ed warnings o# increasedchance o# death and other cardio*ascular disease

In 2++- sales reached + billion

iscontinuation o# late stage clinical trials

Two trials in "hase III #ailed due to statistics that

they had no real e7ectsE5tremely e5"ensi*e

id not loo) good ha*ing bac) to bac) #ailures


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Hea)nesses(elati*ely low le*els o# "roduct di*ersi'cation

1 most success#ul "roducts are all "roteinthera"eutics00< o# re*enues

?ther com"anies "ulling ahead in "romisingmedicine o# "rotein antibodies, small molecule,and limited MA=s drugs

Thera"eutic antibody mar)et is estimated to bethe #astest growing mar)et through 2+0

I$( could limit #uture growth in mar)ets same that"rotected their $E%ylation and %lycosylation #romothers;


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?""ortunityE5"anding $rolia Branchise could dri*e to"line growth

In 2+2 BA released new indicator #or $rolia as a treatment to increasebone mass in men

Showed signi'cant increases in sa#ety and eKcacy


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?""ortunityBocus on emerging economies "ro*iding growth

o""ortunity

?*er "ast / years ha*e e5"anded #rom 10countries to 0+

Including razil and Tur)ey

razil to" ten $harmaceuticals mar)et in the worldand by 2+0 it is estimated to be '#th

Hith more "lans to increase to G0 countries by

2+0 hel"s with di*ersity;


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ThreatsA7yma5=s ?montys li)ely to a7ect Aranes" and E"ogen sales

BA a""ro*ed their $eginesatide in3ection

6i)ely to out"er#orm Amgen=s and only need in3ections once amonth *s@ 1 times a wee)

!ombined with the sa#ety concerns already raised #uture does

not loo) good

!ost containment measures may a7ect Amgen=s sales growth

Amgen relies hea*ily on reimbursements #rom go*ernment aid"rograms and "ri*ate third "arty "ayers

8ealth care re#orm huge threat to those re*enues

Already seen a


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Matching SH with ?T

•(elati*ely low le*els o# "roductdi*ersi'cation

•E5"ertise in (

•Strong I$(

•eclining Aranes" and E"ogensales

•!ost containment measures

•Ac4uired multi"le 'rms with"ro"rietary technologies and"romising new "roducts

•Entering emerging economies

•E5"anding $rolia #ranchise

•Bailure o# late stage clinical trials


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!om"etiti*e Bactors!om"etiti*e #orces at wor) in the industry and

their strength

!om"anies in the strongest&wea)est com"etiti*e"osition

eys to com"etiti*e success


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Amgen=s To" !om"etitors Johnson Johnson

9o*artis A%

Te*a $harmaceutical Industries 6imited

A = Bi i l


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Amgen=s BinancialAnalysis

9et income, sales, and o"erating e5"enses

!urrent ratio is 1@

Asset turno*er ratio is +@12

ebttoe4uity ratio #or 2+2 is @0

9et "ro't margin is +@20

(eturn on e4uity is +@22

(eturn on assets is +@+


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Mar)et Share


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Managerial Bactors The Scienti'c Method

Teams

i*ersity


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Technical Bactors

Manu#acturing

Bacilities

!ollaboration


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Senior Management(obert A@ radway: !hairman and!hie#

E5ecuti*e ?Kcer

Madha*an alachandran: E5ecuti*e >ice

$resident, ?"erations

>ictoria 8@ latter: Senior >ice $resident, D@S@%o*ernment A7airs

Suzanne laug: Senior >ice $resident, %lobalMar)eting and !ommercial e*elo"ment


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Senior Management !ont@$aul (@ Eisenberg: Senior >ice $resident, %lobal

(egulatory A7airs and Sa#ety

Sean E@ 8ar"er: E5ecuti*e >ice $resident,

(esearch and e*elo"ment

(ol# @ 8o7mann: Senior >ice $resident, D@S@!ommercial ?"erations

Anthony !@ 8oo"er: E5ecuti*e >ice $resident,%lobal !ommercial ?"erations


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Senior Management !ont@(aymond !@ Jordan: Senior >ice $resident, !or"orate

A7airs

iana 6@ Mcenzie: Senior >ice $resident and !hie#In#ormation ?Kcer

rian M@ Mc9amee: Senior >ice $resident, 8uman(esources

Joshua J@ ?#man: Senior >ice $resident, %lobal >alue

and Access

!ynthia M@ $atton: Senior >ice $resident and !hie#!om"liance ?Kcer


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Senior Management !ont@ Jonathan M@ $eacoc): E5ecuti*e >ice $resident

and !hie# Binancial ?Kcer

a*id J@ Scott: Senior >ice $resident,%eneral

!ounsel and Secretary

Michael Se*erino: Senior >ice $resident,%lobale*elo"ment and !or"orate !hie# Medical?Kcer


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oard o# irectorsa*id altimore: $resident Emeritus and (obert

Andrews Milli)an $ro#essor o# iology, !ali#orniaInstitute o# Technology

Bran) J@ iondi, Jr@: Senior Managing irector,Hater>iew Ad*isors 66!

(obert A@ radway: !hairman and !hie# E5ecuti*e?Kcer, Amgen Inc@

BranNois de !arbonnel: Bormer !hairman o# theoard and irector, Thomson S@A@ and irector o#!or"orations


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oard o# irectors>ance @ !o7man 6ead Inde"endent irector;:

(etired !hairman o# the oard and !E?, 6oc)heedMartin !or"oration

(obert A@ Ec)ert: Bormer !E? and !hairman o# theoard, Mattel, Inc

(ebecca M@ 8enderson, $h@: John and 9attyMcArthur Dni*ersity $ro#essor, 8ar*ard Dni*ersity

Bran) !@ 8erringer: !hairman and (etired !E?, Transamerica !or"oration


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oard o# irectors Tyler Jac)s: a*id 8@ och $ro#essor o# iology,

Massachusetts Institute o# Technology and directoro# the a*id 8@ och Institute #or Integrati*e!ancer (esearch

%ilbert S@ ?menn: $ro#essor o# Internal Medicine,8uman %enetics $ublic 8ealth and irector o#the !enter #or !om"utational Medicine andioin#ormatics, Dni*ersity o# Michigan, and #ormer

!E?, Dni*ersity o# Michigan 8ealth System

Judith !@ $elham: $resident Emeritus, Trinity 8ealth


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oard o# irectorsAdm@ J@ $aul (eason, DS9 (etired;: Bormer >ice

!hairman and $resident, Metro Machine!or"oration

6eonard @ Schae7er: Senior Ad*isor, T$%!a"ital

(onald @ Sugar: !hairman Emeritus, 9orthro"%rumman !or"oration


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Assessment

Im"ortance o# !ulture

!om"atibility with Strategic !hange

amgen presentation

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