Amgen AMGN · USD

Segment and other informationWe operate our business in one operating segment, which also represents one reportable segment: human therapeutics. Therefore, results of our operations are reported on a consolidated basis for purposes of segment reporting, consistent with internal management reporting.The human therapeutics segment is engaged in the discovery, development, manufacturing and delivery of innovative medicines to fight some of the world’s toughest diseases. The Company’s Chief Executive Officer has been identified as the chief operating decision maker (CODM). The CODM manages and allocates resources on a consolidated basis. The determination of a single segment is consistent with the financial information regularly reviewed by the CODM for purposes of evaluating performance and allocating resources, which is reviewed on a consolidated basis. As the Company’s CODM evaluates the financial performance of the Company’s human therapeutics segment on a consolidated basis, the measure of segment performance is net income, as reflected in the Consolidated Statements of Income. The CODM uses net income to allocate resources on a consolidated basis, which enables the CODM to assess both the overall level of resources available and optimize distribution of resources across functions, therapeutic areas, regions and R&D programs in line with our long-term corporate-wide strategic goals. In addition, the CODM may also evaluate financial performance based on net income adjusted for certain items that are unusual and non-recurring. As the Company manages its assets on a consolidated basis, the measure of segment assets is total assets, as reflected in the Consolidated Balance Sheets. See Note 10, Investments, for further information regarding equity method investments, and Net cash used in investing activities in the Consolidated Statements of Cash Flows for further information regarding capital expenditures.

RevenuesWe operate our business in one operating segment, which also represents one reportable segment: human therapeutics. Therefore, results of our operations are reported on a consolidated basis for purposes of segment reporting, consistent with internal management reporting. Revenues by product and by geographic area, based on customers’ locations, are presented below. A substantial portion of ROW product sales relates to products sold in Europe.Revenues were as follows (in millions):Year ended December 31, 2025Year ended December 31, 2024Year ended December 31, 2023U.S.ROWTotalU.S.ROWTotalU.S.ROWTotalProlia$2,978 $1,436 $4,414 $2,885 $1,489 $4,374 $2,733 $1,315 $4,048 Repatha1,663 1,353 3,016 1,139 1,083 2,222 793 842 1,635 Otezla1,839 426 2,265 1,699 427 2,126 1,777 411 2,188 ENBREL2,199 27 2,226 3,288 28 3,316 3,650 47 3,697 EVENITY1,600 500 2,100 1,131 432 1,563 809 351 1,160 XGEVA1,355 729 2,084 1,507 718 2,225 1,527 585 2,112 TEPEZZA(1)1,758 145 1,903 1,835 16 1,851 441 7 448 BLINCYTO1,049 510 1,559 800 416 1,216 566 295 861 Nplate1,027 497 1,524 970 486 1,456 996 481 1,477 TEZSPIRE (2)1,478 — 1,478 972 — 972 567 — 567 KYPROLIS913 499 1,412 948 555 1,503 921 482 1,403 Aranesp416 973 1,389 386 956 1,342 452 910 1,362 KRYSTEXXA(1)1,340 — 1,340 1,185 — 1,185 272 — 272 Vectibix604 571 1,175 519 526 1,045 461 523 984 Other products(3)5,437 1,826 7,263 4,037 1,593 5,630 3,307 1,389 4,696 Total product sales(4)25,656 9,492 35,148 23,301 8,725 32,026 19,272 7,638 26,910 Other revenues763 840 1,603 562 836 1,398 534 746 1,280 Total revenues$26,419 $10,332 $36,751 $23,863 $9,561 $33,424 $19,806 $8,384 $28,190 ____________(1) TEPEZZA and KRYSTEXXA were acquired from the acquisition of Horizon on October 6, 2023, and include product sales in the periods after the acquisition date.(2) TEZSPIRE is marketed by our collaborator AstraZeneca outside the United States.(3) Consists of product sales of our non-principal products.(4) Hedging gains and losses, which are included in product sales, were not material for the years ended December 31, 2025, 2024 and 2023.In the United States, we sell primarily to pharmaceutical wholesale distributors that we use as the principal means of distributing our products to healthcare providers. Outside the United States, we sell principally to healthcare providers and/or pharmaceutical wholesale distributors depending on the distribution practice in each country.

Contingencies and commitments ContingenciesIn the ordinary course of business, we are involved in various legal proceedings, government investigations and other matters that are complex in nature and have outcomes that are difficult to predict. See Part I, Item 1A. Risk Factors—Our business may be affected by litigation and government investigations. We describe our legal proceedings and other matters that are significant or that we believe could become significant in this footnote.We record accruals for loss contingencies to the extent that we conclude it is probable that a liability has been incurred and the amount of the related loss can be reasonably estimated. We evaluate, on a quarterly basis, developments in legal proceedings and other matters that could cause an increase or decrease in the amount of the liability that has been accrued previously.Our legal proceedings involve various aspects of our business and a variety of claims, some of which present novel factual allegations and/or unique legal theories. The outcomes of these proceedings are inherently uncertain and depend on a variety of factors, including the development of the factual record, judicial or administrative rulings, and, in certain cases, the outcome of appellate review. Further, certain of the matters pending against us are at earlier stages of the legal process, which in complex proceedings of the sort we face often extend for several years, and have not progressed sufficiently through discovery and/or the development of important factual information and legal issues to enable us to estimate. Accordingly, except for amounts accrued, in each of the matters described in this filing in which we could incur a liability, our opponents seek an award of a not-yet-estimable amount of damages or an amount that is not material. While it is not possible to accurately predict or determine the eventual outcomes of these matters, an adverse determination in one or more of these matters currently pending could have a material adverse effect on our consolidated results of operations, financial position or cash flows.Certain recent developments concerning our legal proceedings and other matters are discussed below.Repatha Patent LitigationPatent Disputes in the International RegionWe are involved in and expect future involvement in additional disputes regarding our PCSK9 patents in other jurisdictions and regions.

Income taxesIncome before income taxes included the following (in millions):Years ended December 31,202520242023Domestic$8,220 $4,040 $4,047 Foreign756 569 3,808 Total income before income taxes$8,976 $4,609 $7,855 The provision for income taxes included the following (in millions):Years ended December 31,202520242023Current provision:Federal$959 $965 $1,524 State35 33 43 Foreign971 759 786 Total current provision1,965 1,757 2,353 Deferred benefit:Federal(465)(860)(1,124)State7 (18)(25)Foreign(242)(360)(66)Total deferred benefit(700)(1,238)(1,215)Total provision for income taxes$1,265 $519 $1,138 Deferred income taxes reflect the tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, tax credit carryforwards and the tax effects of NOL carryforwards. As of December 31, 2022, we elected to establish deferred taxes with respect to the U.S. tax on the earnings of our foreign subsidiaries for the reversal of temporary items in future years. Significant components of our deferred tax assets and liabilities were as follows (in millions):December 31,20252024Deferred income tax assets:NOL and credit carryforwards$1,368 $1,352 Accrued expenses890 693 Capitalized research and development expenses1,655 1,762 Investments— 1 Expenses capitalized for tax218 200 Earnings of foreign subsidiaries2,305 1,496 Stock-based compensation138 130 Other349 361 Total deferred income tax assets6,923 5,995 Valuation allowance(1,299)(1,019)Net deferred income tax assets5,624 4,976 Deferred income tax liabilities:Acquired intangible assets(2,065)(2,573)Debt(260)(264)Fixed assets(192)(143)Fair value of acquired inventory(28)(114)Investments(422)— Other(271)(244)Total deferred income tax liabilities(3,238)(3,338)Total deferred income taxes, net$2,386 $1,638 The Company has determined that unremitted foreign earnings are not considered indefinitely reinvested to the extent foreign earnings can be distributed without a significant tax cost.Valuation allowances are provided to reduce the amounts of our deferred tax assets to an amount that is more likely than not to be realized based on an assessment of positive and negative evidence, including estimates of future taxable income necessary to realize future deductible amounts.

Stock-based compensationOur Amended 2009 Plan authorizes for issuance to employees of Amgen and nonemployee members of our Board of Directors shares of our common stock pursuant to grants of equity-based awards, including RSUs, stock options and performance units. The pool of shares available under the Amended 2009 Plan is reduced by one share for each stock option granted and by 1.9 shares for other types of awards granted, including full-value awards. In general, if any shares subject to an award granted under the Amended 2009 Plan expire or become forfeited, terminated or canceled without the issuance of shares, the shares subject to such awards are added back into the authorized pool on the same basis that they were removed. In addition, under the Amended 2009 Plan, shares withheld to pay for minimum statutory tax obligations with respect to full-value awards are added back into the authorized pool on the basis of 1.9 shares. As of December 31, 2025, the Amended 2009 Plan provides for future grants and/or issuances of up to approximately 35 million shares of our common stock. Stock-based awards under our employee compensation plans are made with newly issued shares reserved for this purpose.The following table reflects the components of stock-based compensation expense recognized in our Consolidated Statements of Income (in millions):Years ended December 31,202520242023RSUs$333 $351 $309 Performance units112 133 121 Stock options49 46 43 Total stock-based compensation expense, pretax494 530 473 Tax benefit from stock-based compensation expense(106)(114)(102)Total stock-based compensation expense, net of tax$388 $416 $371 Restricted stock units and stock optionsEligible employees generally receive an annual grant of RSUs and, for certain executive-level employees, stock options, with the size and type of award generally determined by the employee’s salary grade and performance level. Certain management and professional-level employees typically receive RSU grants upon commencement of employment. Nonemployee members of our Board of Directors also receive an annual grant of RSUs.Our RSU and stock option grants provide for accelerated or continued vesting in certain circumstances as defined in the plans and related grant agreements, including upon death, disability, termination in connection with a change in control and the retirement of employees who meet certain service and/or age requirements.

LeasesWe lease certain facilities and equipment related primarily to R&D, administrative and commercial activities. Leases with terms of 12 months or less are expensed as incurred and are not recorded in the Consolidated Balance Sheets.Most leases include one or more options to renew, with renewal terms that may extend the lease term up to ten years. The exercise of lease renewal options is at our sole discretion. In addition, some of our lease agreements include rental payments adjusted periodically for inflation. Our lease agreements neither contain residual value guarantees nor impose significant restrictions or covenants. We sublease certain real estate to third parties. Our sublease portfolio consists of operating leases from former R&D and administrative spaces.The following table summarizes information related to our leases, all of which are classified as operating, included in our Consolidated Balance Sheets (in millions):December 31,Consolidated Balance Sheets locations20252024Assets:Other noncurrent assets$602 $557 Liabilities:Accrued liabilities$135 $107 Other noncurrent liabilities696 673 Total lease liabilities$831 $780 The components of net lease costs were as follows (in millions): Years ended December 31,Lease costs202520242023Operating(1)$265 $219 $208 Sublease income(9)(17)(28)Total net lease costs$256 $202 $180 ____________(1) Includes short-term leases and variable lease costs, which were not material for the years ended December 31, 2025, 2024 and 2023.Maturities of lease liabilities as of December 31, 2025, were as follows (in millions):Maturity datesAmounts2026$148 2027153 2028128 202999 203077 Thereafter362 Total lease payments(1)967 Less imputed interest(136)Present value of lease liabilities$831 ____________(1) Includes future rental commitments for properties that have been subleased in the amount of $99 million. We expect to receive total future rental income of $54 million related to noncancellable subleases.The weighted-average remaining lease terms and weighted-average discount rates were as follows:December 31,20252024Weighted-average remaining lease term (in years)8.79.3Weighted-average discount rate4.0 %3.

AcquisitionAcquisition of Horizon Therapeutics plcOn October 6, 2023, Amgen completed its acquisition of Horizon by acquiring all of the outstanding shares of Horizon for $116.50 per share in cash, representing a total consideration of approximately $27.8 billion. Horizon is a global biotechnology company focused on the discovery, development and commercialization of medicines that address critical needs of patients impacted by rare, autoimmune and severe inflammatory diseases. The acquisition, which was accounted for as a business combination, aligns with Amgen’s core strategy of delivering innovative medicines that make a significant difference for patients suffering from serious diseases and strengthens Amgen’s leading rare disease portfolio by adding first-in-class, early-in-lifecycle medicines, including TEPEZZA for TED, KRYSTEXXA for chronic refractory gout and UPLIZNA for neuromyelitis optica spectrum disorder. Upon its acquisition, Horizon became a wholly owned subsidiary of Amgen, and its operations have been included in our consolidated financial statements commencing on the acquisition date.During the year ended December 31, 2024, the purchase price allocation of the acquisition was completed and measurement period adjustments were finalized, which included changes to the purchase price allocation that resulted in a net increase of approximately $25 million to goodwill. The measurement period adjustments resulted primarily from adjustments to acquired assets and liabilities, including deferred tax attributes, based on facts and circumstances that existed as of the acquisition date and did not result from events subsequent to the acquisition date. The adjustments did not have a significant impact on Amgen’s results of operations during the year ended December 31, 2024, and would not have had a significant impact on prior-period results if the adjustments had been made as of the acquisition date.The following table summarizes the final total consideration and allocated acquisition date fair values of assets acquired and liabilities assumed, inclusive of measurement-period adjustments (in millions):Cash and cash equivalents$681 Inventories5,014 Property, plant and equipment, net318 Finite-lived intangible assets—developed-product-technology rights19,590 IPR&D1,060 Goodwill3,136 Deferred tax asset795 Deferred tax liability(2,488)Other assets and liabilities, net(273)Total assets acquired, net of liabilities assumed$27,833 The $27.

Amgen has a multi-layered and iterative approach towards assessing, identifying, managing and mitigating risks from cybersecurity threats. The Amgen Technology & Medical Organizations (ATMOS) function is designed to support our productivity, innovation and outreach globally through the quality delivery of information systems, solutions and services for our business and operations. The ATMOS function has a Cybersecurity & Digital Trust (CDT) team that assesses and reduces cybersecurity exposure, including by providing employees with training and resources to identify potential cybersecurity threats and implementing information technology security practices. The CDT team also monitors for cybersecurity threat activity and seeks to mitigate the impact from cybersecurity incidents by deploying information security engineers, system architects, analysts and cybersecurity specialists to provide monitoring, reporting and management of cybersecurity incidents.To evaluate the progress of its activities, our ATMOS function uses various industry and regulatory frameworks as guides to assess the state of the Company’s cybersecurity program maturity and controls, including our organizational, people, physical and technological controls. The CDT team also conducts reviews and evaluations of our cybersecurity resilience program with Amgen’s Cybersecurity & Digital Trust Governance Council (which includes leaders from CDT, Worldwide Compliance and Business Ethics, Regulatory Affairs, Operations, R&D, Global Commercial Operations, Corporate Audit, Finance, Law and Business Development functions).Our cybersecurity risk management program is considered by and integrated into our Company-wide Enterprise Risk Management program and shares common methodologies, reporting channels and governance processes that apply across the Enterprise Risk Management program to that of other enterprise level risks (such as product development, safety and surveillance, financial and intellectual property risks). Regular evaluations are conducted of the greatest risks to our business and their underlying risk drivers as well as the associated mitigation activities, maturity and controls. This program is overseen by our Executive Vice President and Chief Financial Officer and guided by the Enterprise Risk Council, a cross-functional group of the Company’s business leaders representing key business functions that is co-chaired by our Chief Audit Executive.