What Amgen actually does
Amgen is one of the original biotechnology companies, founded in 1980 in California. It develops and sells medicines made from living cells, with products in areas such as inflammation, bone health, heart disease and cancer. Well-known brands include Enbrel, Prolia, Repatha and Otezla.
How the business makes money
Amgen sells prescription drugs through wholesalers, pharmacies and hospitals. A drug can earn a great deal while it is protected by patents, so the company spends heavily on research and buys other companies to refill its pipeline. In 2023 it bought Horizon Therapeutics, which added debt but also new products.
The dividend story
Amgen started paying a dividend in 2011 and has raised it regularly since. The payout is paid quarterly and is meaningful relative to the share price. The key question for any pharma dividend is whether the next generation of medicines can replace the ones that lose protection.
What to keep an eye on
- Patent expiries. Older drugs face cheaper biosimilar competition.
- Drug pricing. Government price negotiation and insurer pressure.
- Debt. Acquisitions have left the balance sheet more leveraged.
- Pipeline results. Trial setbacks can move the share price a lot.
Quick take
Amgen is a cash-generating biotech with a growing dividend, but its future depends on what comes next from the pipeline.