What is the primary purpose of this 8-K filing?

The primary purpose of this 8-K filing is to report Amgen Inc.'s unaudited financial results for the fourth quarter and full year ended December 31, 2006, along with the accompanying press release which provides detailed financial information and non-GAAP adjustments.

What are non-GAAP financial measures and why does Amgen use them?

Non-GAAP financial measures are financial metrics that exclude certain items from GAAP (Generally Accepted Accounting Principles) financial results. Amgen uses them to exclude the impact of stock option expensing, merger and acquisition-related costs, and amortization of acquired intangible assets. The company believes these measures provide useful supplementary information to investors, allowing for better comparisons between periods and a clearer understanding of ongoing operational performance.

What were some of the significant items adjusted for in the non-GAAP measures for 2006?

For 2006, significant adjustments included the impact of expensing stock options under SFAS No. 123R, costs and amortization related to the acquisitions of Avidia, Abgenix, and Tularik, and write-offs of acquired in-process R&D. These were applied to various line items including cost of sales, R&D, SG&A, net income, and earnings per share.

Were there any notable non-GAAP adjustments for the 2005 period discussed?

Yes, for 2005, adjustments included Tularik merger expenses, a legal settlement related to Genentech, Immunex intangible asset amortization, a tax liability from repatriating foreign earnings, manufacturing write-offs, and a net gain from terminating a manufacturing agreement with Genentech. These adjustments also impacted various financial metrics including R&D, SG&A, net income, and earnings per share.

AMGN 8-K: Earnings & Results

Summary

Amgen Inc. filed an 8-K on January 25, 2007, to report its unaudited financial results for the fourth quarter and full year ended December 31, 2006. The report details the company's use of non-GAAP financial measures, which exclude items such as the expensing of stock options (SFAS No. 123R) and various merger and acquisition-related costs and intangible asset amortization. These adjustments are presented to provide investors with a clearer view of operational performance by isolating ongoing business activities from one-time or non-cash charges. Key adjustments for 2006 include impacts from the acquisitions of Avidia, Abgenix, Tularik, and Immunex, as well as stock option expensing. For 2005, adjustments relate to Tularik merger expenses, a legal settlement, Immunex intangible asset amortization, a tax liability, and other charges like manufacturing write-offs and a gain from terminating a manufacturing agreement with Genentech. Amgen believes these non-GAAP measures offer useful supplementary information for analyzing performance trends and for internal budgeting and planning.

Key Highlights

1Amgen Inc. reported its unaudited financial results for the three and twelve months ended December 31, 2006.
2The company utilized non-GAAP financial measures, adjusting for stock option expensing (SFAS No. 123R) and various acquisition-related costs (Avidia, Abgenix, Tularik, Immunex).
3Key acquisition-related adjustments include merger expenses, intangible asset amortization, and in-process R&D write-offs for 2006.
4For 2005, adjustments focused on merger expenses, legal settlements, intangible asset amortization, tax liabilities, manufacturing charges, and gains/losses from contract terminations.
5Non-GAAP measures were presented for cost of sales, R&D expense, SG&A expense, provision for income taxes, net income, and diluted earnings per share.
6The company believes these non-GAAP measures facilitate analysis and comparisons between periods.
7The press release announcing these results is attached as Exhibit 99.1.

AMGEN INC 8-K Report, Financial Results (Jan 25, 2007)

Summary

Key Highlights

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