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Harvard University

Networking in a Biotech Innovation Hub

Amgen on the move in Cambridge, Massachusetts

MAY 18, 2015

At a recent reception held at Amgen’s Massachusetts facility, Senior Vice President of Business Development David Piacquad and Amgen deal makers spoke with more than 100 people from biotech startups, venture capital groups, and industry peers. The reception was organized by the business development team in Cambridge and took place during the World Medical Innovation Forum held in Boston, where Amgen also played a prominent role with presentations from Amgen’s senior leadership team.

Here are six takeaways from the event that highlight Amgen’s business development approach to partnerships and deal making:

  1. Partnerships have always been important to Amgen’s growth—and that continues
    While reflecting on Amgen’s 35 years as a company, Piacquad noted that partnerships have long played an important role in its growth. He went on to note that roughly half of the molecules in Amgen’s late-stage pipeline come from acquisitions or licensing agreements, reflecting Amgen’s “balanced approach to sourcing internal and external innovation.”
  2. Amgen is expert in structuring highly customized deals
    “Sometimes we hear from people that Amgen only does one type of deal,” said Piacquad. “That’s not true. What we are really good at is the customized, or bespoke, deal. I think our strength lies in getting together with another party to understand what they need and what we need and being really thoughtful about how we can come to an agreement.” He pointed to recent deals like with Celimmune, Kite Pharma, and Astellas as examples.
  3. Long-term relationship-building is important to Amgen
    “We look at about 2,900 deals a year and we end up only doing a handful so we are pretty selective,” noted Piacquad. “However, if you’ve dealt with us and we didn’t end up doing a deal, hopefully we gave you thoughtful feedback and we created a relationship for future dialog.”
  4. Amgen is reaching out to innovators at early stages through Amgen Ventures
    “Venture-based companies are absolutely the lifeblood of this industry and at Amgen Ventures, we have $500 million under management, not all invested,” said Piacquad, “$200 million is for direct investments in companies and $300 million is for LP investments. We think this is a really important part of what we do and, in addition to funding, we bring a lot of expertise.” He also talked about Amgen’s sponsorship of LabCentral, a unique laboratory space for scientists in Cambridge. 
  5. Amgen spinouts are an example of realizing value—and innovation
    “As a company, Amgen has an R&D budget of approximately $3.5 billion, and yet we still can’t fund every project we have,” said Piacquad. “There are too many good projects to fund. Every now and then we have good projects that are just below the funding line and we say, ‘This is a good technology. This has a really good chance to make it and to do something important. So what do we do? Do we kill it or do we spin it out and maybe play for something bigger? In cases where we have a thematic portfolio, and a management team that can make something happen, the spinout is a great model we are actively using.” He went on to mention recent spinouts like NextCODE Health and Atara Biotherapeutics, the latter involving investing with one of the founding investors of Amgen 35 years ago—a testament to what can be achieved by maintaining positive relationships with potential partners and investors.
  6. Amgen is focused on creating collaborative relationships in biotech innovation hubs like Cambridge
    “Amgen is focused on enhancing its presence in key innovation hubs,” said Amgen Vice President and Site Head Sam Guhan, who introduced Piacquad and welcomed attendees, “and when you talk about innovative hubs in the life sciences, there is no better place to be than Cambridge, Massachusetts. We are very excited to be here, about our plans for growth, and about increasing collaborations with biotech startups, industry peers, and academic institutions in the area.” One example of this type of collaboration is with Mass. General, Broad Institute and Amgen related to inflammatory bowel disease.


Forward-Looking Statements

This release contains forward-looking statements that involve significant risks and uncertainties, including those discussed below and others that can be found in our Form 10-K for the year ended December 31, 2014, and in any subsequent periodic reports on Form 10-Q and Form 8-K.  Amgen is providing this information as of the date of this release and does not undertake any obligation to update any forward-looking statements contained in this document as a result of new information, future events or otherwise.

No forward-looking statement can be guaranteed and actual results may differ materially from those we project.  The Company’s results may be affected by our ability to successfully market both new and existing products domestically and internationally, clinical and regulatory developments (domestic or foreign) involving current and future products, sales growth of recently launched products, competition from other products (domestic or foreign) and difficulties or delays in manufacturing our products.  In addition, sales of our products are affected by reimbursement policies imposed by third-party payers, including governments, private insurance plans and managed care providers and may be affected by regulatory, clinical and guideline developments and domestic and international trends toward managed care and healthcare cost containment as well as U.S. legislation affecting pharmaceutical pricing and reimbursement.  Government and others’ regulations and reimbursement policies may affect the development, usage and pricing of our products.  Furthermore, our research, testing, pricing, marketing and other operations are subject to extensive regulation by domestic and foreign government regulatory authorities.  We or others could identify safety, side effects or manufacturing problems with our products after they are on the market.  Our business may be impacted by government investigations, litigation and product liability claims.  If we fail to meet the compliance obligations in the corporate integrity agreement between us and the U.S. government, we could become subject to significant sanctions.  Further, while we routinely obtain patents for our products and technology, the protection offered by our patents and patent applications may be challenged, invalidated or circumvented by our competitors.  We depend on third parties for a significant portion of our manufacturing capacity for the supply of certain of our current and future products and limits on supply may constrain sales of certain of our current products and product candidate development.  In addition, we compete with other companies with respect to some of our marketed products as well as for the discovery and development of new products.  Discovery or identification of new product candidates cannot be guaranteed and movement from concept to product is uncertain; consequently, there can be no guarantee that any particular product candidate will be successful and become a commercial product.  Further, some raw materials, medical devices and component parts for our products are supplied by sole third-party suppliers.  Our efforts to integrate the operations of companies we have acquired may not be successful.  We may experience difficulties, delays or unexpected costs and not achieve anticipated benefits and savings from our recently announced restructuring plan.  Our business performance could affect or limit the ability of the Amgen Inc. Board of Directors to declare a dividend or our ability to pay a dividend or repurchase our common stock.