Earnings Call Transcript - AMGN Q1 2020

Operator, Operator

My name is Ian, and I’ll be your conference facilitator today for Amgen's First Quarter 2020 Financial Results Conference Call. All lines have been placed on mute to prevent any background noise. There will be a question-and-answer session at the conclusion of the last speaker’s prepared remarks. In order to ensure that everyone has a chance to participate, we would like to request that you limit yourself to asking one question during the Q&A session. I would now like to introduce Arvind Sood, Vice President of Investor Relations. Mr. Sood, you may now begin.

Arvind Sood, Vice President of Investor Relations

Okay. Thanks, Ian. Good afternoon, everyone. Thanks for joining us for our Q1 call. I hope you and your families are staying safe. We are positioned with the COVID-19 pandemic. I know I speak on behalf of all my colleagues at Amgen when I say that it's a source of great pride that we work in an industry that can be a part of the solution. Before we start, I would like to recognize those who are new in their coverage of Amgen, including Tim Anderson of Wolfe Research; Carter Gould of Barclays; and Michael Schmidt of Guggenheim. Welcome. Over the past few weeks I've talked with many of you, and you have expressed concerns and posed questions about how this COVID pandemic will impact our business, including supply chain, clinical trials, commercial operations, and growth outlook. As our growth outlook will be defined by how these variables unfold in the future, we have modified the order of presenters today so you can get a good sense of how we are dealing with the uncertainties and remedial actions we are taking to run our business effectively. Our CEO, Bob Bradway, will commence the call with some opening comments; followed by our Head of R&D, Dave Reese, who will provide a pipeline update; our Head of Commercial Operations, Murdo Gordon, who will give you a state of the business; and then our CFO, Peter Griffith, who will bring it all together by helping you understand what all this means in terms of our growth outlook. By the way, consistent with the recommendations for social distancing, we are all in different locations today. So please bear with us as we are doing the best we can. Just a quick reminder that we'll use non-GAAP financial measures in today's presentation, and some of the statements will be forward-looking statements. I would direct you to our 10-K and subsequent filings, which identify factors that could cause our actual results to differ materially. So with that, I would like to turn the call over to Bob. Bob?

Bob Bradway, CEO

Okay. Good afternoon, everyone. I want to acknowledge upfront that this has been an extraordinary quarter for all of us. Global pandemic, economic disruption like none of us have seen before, and of course financial volatility that has been dizzying at times. But I hope you're keeping well, and we're certainly grateful to you for joining the call. Results show we're managing through the COVID disruption quite well and feel we're operating from a position of strength with a healthy balance sheet, a strong portfolio of products, and an organization that has proven itself time and again to be innovative, resilient, and able to adapt quickly to changing circumstances. I want to take a few moments to share how we've been responding to COVID-19 and then we can dive into the details of the first quarter and what we see for the remainder of the year. We've mobilized our company around four priorities. First, taking care of our staff, our 23,000 staff around the world; second, continuing to serve patients with an uninterrupted supply of our commercial and clinical medicines; third, leveraging our core genetics, immunology, and antibody expertise in the fight against COVID-19; and finally, supporting the communities where we live and work. Our first priority from the beginning of the pandemic has been to ensure the safety of our people and their families. To encourage social distancing, Amgen staff worldwide are mostly working from home now. We're encouraged that in a few markets, conditions have improved to the point where we've begun returning our people to the workplace, and we hope to expand our back-to-the-workplace activities in the coming weeks. I would also note that about a quarter of our staff are engaged in essential manufacturing and R&D activities that have required them to continue coming to the workplace every day. We're taking every possible measure to keep these employees safe, and we're grateful to them for their commitments to patients and to our business. All our staff are performing really well, as you can see from our results. At a time when healthcare systems around the world are being stretched to their limits, we're committed to working collaboratively with our partners in the healthcare ecosystem. We need to make sure that we're both responding to COVID-19 and meeting the ongoing needs of other seriously ill patients amidst this health crisis that we as a society never intended. From a supply chain perspective, we've not experienced any significant disruptions, and we don't currently anticipate any shortages of our medicines due to COVID-19. With respect to clinical trials, our pivotal studies, including for AMG 510, Otezla, tezepelumab, and omecamtiv mecarbil, are fully enrolled and expected to read out this year, as previously announced. Other programs such as our BiTEs in oncology have also continued to progress, and we're encouraged by the accumulating data there. Where programs have been interrupted by the COVID pandemic, we're busy making plans to get them restarted as soon as appropriate from a patient safety and regulatory perspective. By now, it's clear that overcoming this pandemic will require innovative science. While the virus may have gotten the jump on us at the outset, the good news is that the community of innovative biopharmaceutical companies is moving at a speed and scale never seen before, and we're gaining ground on the virus with each passing day. While our research does not include antivirals, we have a role to play in this battle, leveraging our genetics, immunology, and antibody expertise to do so. As previously announced, we're harnessing the molecular epidemiology work done by our deCODE subsidiary and working with our partners at Adaptive Biotechnologies to develop an antibody to prevent or treat COVID-19. If we're successful, our industry-leading manufacturing capabilities will play an important role in helping us meet the needs of patients. In addition, based on its mechanism of action, Otezla might help prevent the respiratory distress seen in late-stage COVID patients. As Dave Reese will explain in a moment, we'll be exploring this question in clinical trials imminently. And we've long prioritized being a good citizen within the healthcare ecosystem and within the communities where we live and work. COVID-19 has been devastating for many. While we certainly have been impacted by the pandemic at Amgen, we recognize that we're in a fortunate position, and we're committed to doing our part to help during this time of need. Toward that end, the Amgen Foundation is supporting COVID-19 in a variety of ways, with a focus on communities where we have a significant presence. To give you just one example, we donated testing equipment in Ventura County, our home county, that effectively has doubled the testing capacity for COVID-19 here. Looking forward, we're confident in the future. We were in a strong position heading into the COVID-19 pandemic, and we expect to stay strong as we come through the other side of this. We remain focused on delivering sustained long-term growth, and we're confident in our outlook for that. As I've already noted, we have a number of important innovative medicines advancing our pipeline, and the key programs remain on track from a timing perspective. Our integration of Otezla has been seamless. In Japan, we have now successfully completed the integration of our Astellas partnership. And we're already well advanced in collaborating effectively with our colleagues in Beijing, China. All this gives me confidence that we're executing effectively around the world despite the challenges of COVID-19. Finally, a fact that will enable us to continue our capital allocation principles, which to remind you are to invest in innovation internally and externally, while returning significant capital to our shareholders. Though the pandemic is still very fluid, and to be sure the first few weeks of April have clearly shown some signs of disruption, the combination of our results from the first quarter and our expectation of an improving outlook for global healthcare activity gives us confidence that the guidance we provided earlier in the year still incorporates the likely range of outcomes for our business in 2020. Peter will give you more clarity on this shortly. Amgen's strength has always come from its people. Like me, they believe in the power of science to make a difference in the world. We often talk about this being the biocentury, the golden age of innovation for biology. We may have met our challenge of the century in SARS-CoV-2, but I hope however bleak this pandemic may seem at times, that all of you share our optimism: this virus will ultimately yield to the relentless efforts of the biopharmaceutical industry. I'm proud of the team at Amgen for coming together to support each other and all those we serve during such a challenging time. I'm proud also of the work we are doing with our industry colleagues to tackle the COVID-19 challenge. With that, let me turn over to Dave Reese, who will provide a pipeline update. Dave?

Dave Reese, Head of R&D

Thanks, Bob, and good afternoon, everyone. Due to the ongoing COVID-19 pandemic, today’s R&D update will be adapted from my usual format. You can find some first quarter highlights in our press release and presentation, and I look forward to answering any questions about our pipeline after my initial comments. We are currently facing one of the largest public health challenges in history, impacting patient care and clinical development significantly. Therefore, my remarks will primarily focus on our R&D operations and the execution of clinical trials during this time, where our top priority is ensuring the safety of patients and healthcare providers involved in these trials. Regarding key late-stage trials set to report results this year, we've been collaborating closely with AstraZeneca and Cytokinetics to carry out our pivotal studies for tezepelumab and omecamtiv mecarbil, both of which are fully enrolled. We do not anticipate major delays and still expect to conclude these studies this year, aiming for high-quality data from both trials. This is similarly true for our potentially pivotal Phase II study for AMG 510, now known as sotorasib, in patients with advanced non-small cell lung cancer, which is also fully enrolled. As I mentioned last quarter, we will gather a minimum of six months of response data from these patients, with results anticipated later this year. I would like to note that the Phase III trial for Otezla in mild to moderate psoriasis remains on track, and we expect data from this study in the upcoming weeks. As previously mentioned, we have temporarily halted enrollment in clinical trials when there is uncertainty regarding the safety of subjects or data integrity. Patients already participating in our studies continue to receive their investigational products, and we are focused on supporting our clinical investigators to ensure the proper care of these patients, adhering to clinical site and agency guidelines. We are collaborating with regulators and have implemented study procedures consistent with recent FDA guidelines, such as remote monitoring, virtual follow-up, alternative assessment locations, and home delivery of investigational products. We are making decisions on a study-by-study and site-by-site basis to reduce risk for patients and maintain trial integrity. For example, we are still enrolling patients in certain studies where there is potential for significant benefit in serious life-threatening conditions, provided site resources allow for safe enrollment and monitoring. These trials include our half-life extended BiTE programs targeting BCMA and PSMA, and we look forward to sharing data from them later this year. In other studies, such as the sotorasib Phase I combination study with Keytruda and the Phase III confirmatory study, we have paused enrollment to prioritize safety. Timelines may be affected, and I will keep you updated as the situation evolves and we gain clarity. There remains strong interest from investigators in providing their patients access to investigational therapies that could offer significant benefits, and we are continuing to advance study start-up activities for sotorasib and our entire portfolio to facilitate rapid site activation. We anticipate resuming enrollment in paused studies and starting new studies as soon as it is safe to do so. As we look forward to this year’s clinical study results, we will work with medical conferences and journals to ensure timely sharing of important data within the medical community, assuming many congresses remain virtual through the end of 2020. We are committed to providing data updates promptly. We are also continuing to prioritize our programs across both preclinical and clinical stages. For instance, stemming from our progress with half-life extended BiTE molecules, we have discontinued the development of our first-generation continuous infusion PSMA and BCMA BiTE programs. In research, essential work has persisted, and we are starting to ramp up laboratory activities across different regions as conditions permit. I’m also pleased to report that our collaboration with BeiGene is progressing well, and this quarter we began transferring certain functional activities to BeiGene, including non-promotional activities related to in-line products and some local regulatory tasks in China. I want to conclude by discussing how we are utilizing our expertise in therapeutic antibody development and immunology to address COVID-19. Our collaboration with Adaptive Biotechnologies to identify neutralizing antibodies from COVID-19 patients is currently underway. We see this as a unique opportunity, combining Adaptive’s profiling expertise with Amgen’s capabilities in immunology and antibody engineering. We are working diligently to identify high-quality therapeutic candidates swiftly, taking advantage of frequent interactions with regulatory authorities. We anticipate that there will be multiple generations of antibody therapeutics and aim to develop the best possible candidates. In addition to our therapeutic antibody initiatives, we are also in discussions with various groups conducting platform trials for COVID-19 and expect Otezla to enter the clinic soon as a potential immunomodulatory treatment for adult patients with the disease. Moreover, we are actively partaking in collective efforts to advance COVID-19 therapeutics, including the ACTIV partnership with the NIH. Finally, I want to recognize our staff, who are working tirelessly under these difficult circumstances to support our patients. Their dedication and execution have been outstanding, and I am immensely grateful to them. Now, I will turn it over to Murdo Gordon.

Murdo Gordon, Head of Commercial Operations

Thanks, Dave, and good afternoon, everyone. We started the year with strong volume-driven growth of 15% on a global basis, with 10% in the U.S. and 32% ex-U.S. Growth was generated broadly across our portfolio of newer products, more than offsetting declines in our mature brands. Given the unprecedented nature of the COVID-19 pandemic, I want to start by sharing our views on how disruptions in the global healthcare system may impact our business, and then I'll walk through what we're seeing at the product level and what actions we are taking. Like others in our sector, we're seeing varying degrees of impact from COVID-19 across our portfolio, as physician-patient interactions are interrupted. These reduced interactions have led to some delays in diagnosis and treatment, which in turn reduces new patient starts. Data from IQVIA suggests that patient office visits have declined by over 50%, although some of this is being offset by telemedicine and telehealth services. Data also show that some patients refilled prescriptions early, and that there was a modest benefit of approximately $100 million from inventory in the quarter. Finally, increased utilization of patient affordability programs and changes in segment mix due to increased U.S. unemployment could negatively impact U.S. net prices. Treatments like Prolia that require in-office administration by a healthcare provider have been negatively impacted. On the other hand, a product like Otezla may benefit given that it provides a convenient oral option for patients compared with injectable or IV biologics, some of which require monitoring. Despite this disruption, our teams are responding to customer needs via remote interactions. We're identifying innovative solutions to help patients, and we're supplying products reliably and consistently. Now let me review some product details, beginning with Prolia on Slide 12. Prolia grew 10% year-over-year from higher volume. Strong demand growth in January and February was consistent with prior years. In March, we began to see a negative impact on Prolia in-office injections and have since observed a substantial step down in utilization versus prior years. In more recent weeks, we're beginning to see signs of stabilization, and we'll be able to provide more clarity on this when we report our Q2 results in July. The importance of treating osteoporosis in patients who are at high-risk of fractures is critical. Our teams are working to address continuity of care issues and exploring novel solutions such as alternate sites of care, mobile nurse-administered injections, and prescription fills at specialty and retail pharmacies. We're also working with policymakers and advocacy organizations to address treatment challenges in this environment. Moving to Evenity, which launched in Japan and the U.S. in the first half of 2019. Evenity posted $100 million in sales during the first quarter, driven by continued uptick. In Japan, which represents roughly two-thirds of Evenity sales, we've attained shares similar to those established anabolic therapies. In the U.S., we saw an acceleration in demand trends with improvements in persistence in Q1 as clinics gained more experience. As patients complete their one-year cycle of therapy with Evenity, we will work with healthcare providers to help transition these patients to Prolia. Evenity and Prolia are a complementary set of options to address the 9 million fractures that occur worldwide in postmenopausal osteoporosis patients, and our teams are focused on ensuring these patients are not compromised during this pandemic. Moving to Repatha, we're off to a strong start in 2020. Our efforts over the past 18 months to improve access and affordability have yielded strong results, as Q1 sales grew by 62% year-over-year, driven by 98% volume growth versus the same period last year. New-to-brand prescriptions in the U.S. steadily improved in Q1, growing 51% year-over-year, and we held 80% market share exiting the quarter. As we appreciated in our last earnings call, Part D contracting to improve access and affordability resulted in a step down in Repatha's net selling price in Q1. We expect net selling price to be relatively stable for the remainder of the year. On to Aimovig on Slide 15. On a year-over-year basis, net sales grew 20% with underlying volume growth of 46%. Aimovig remains the market leader with 48% total prescription share. To date, almost 330,000 patients have been prescribed Aimovig by more than 33,000 prescribers. With the recent addition to CVS National Preferred Formulary, we now have access to 93% of covered lives, which led to a 19% growth quarter-over-quarter in new-to-brand prescriptions. Net price was sequentially lower due to expanded access with CVS and higher co-pay utilization that occurs each year in the first quarter. These factors were partially offset by the proportion of paid prescriptions increasing to almost 90%, up from 81% in Q4 of 2019. Next to our inflammation portfolio starting with Otezla. Integration has been seamless, evidenced by 23% year-over-year growth driven by volume. These results, coupled with planned label expansion, give us confidence in our ability to realize the full global potential of Otezla, as an affordable option with a very well-defined efficacy and safety profile. In the current COVID environment, Otezla provides a convenient oral option for patients. It's conducive to telemedicine and does not require lab monitoring. Moving to Enbrel, sales were $1.2 billion in Q1 and included a $70 million year-over-year benefit from favorable changes in accounting estimates related to sales deductions. Consistent with prior trends, prescription volumes declined 5% year-over-year. We continue to expect a limited benefit from net selling price in 2020 versus 2019. In this environment, we're supporting Enbrel's strong continuing base of patients in maintaining their course of therapy through disruptions and out-of-pocket cost barriers. As you know, Enbrel has been on the market for over 20 years and does not require routine lab monitoring. Now to slide 18. Another contributor to our inflammation franchise is Amgevita, which for three consecutive quarters has been the number one adalimumab Biosimilar in Europe, recording $86 million of sales in Q1. Switching to our hematology and oncology business, our innovative portfolio of six brands collectively totaled $1.3 billion in the quarter, growing by 11% year-over-year. Certain products like XGEVA may be impacted in the current environment due to disruptions in physician-patient interactions. Although others, including Neulasta OnPro and our oncology biosimilars MVASI and KANJINTI, provide greater value. Let me highlight some of our larger products. KYPROLIS grew 14% year-over-year led by a 21% increase in U.S. sales, which was driven by expanded use in second and third-line multiple myeloma. Neulasta declined 40% year-over-year; recall that Q1 of 2019 benefited from a $98 million BARDA order, which did not repeat this quarter. OnPro continues to be the preferred choice and has held quarter-over-quarter share at 54% despite facing an additional competitor. The revised NCCN guidelines recommend increased use of G-CSFs to minimize the risk of febrile neutropenia in cancer patients. OnPro provides a unique value proposition, particularly now as patients can receive their G-CSF treatment without having to return to their site of care. Our two oncology biosimilars, MVASI and KANJINTI, generated $234 million in sales globally in the first quarter. In the U.S., they sold $108 million and $96 million respectively, with market shares exiting Q1 at or above 27%. We continue to see encouraging adoption rates in clinics, with hospital adoption accelerating. These biosimilars are increasingly valuable given the cost savings that they provide. Switching to nephrology, starting on slide 24. Given the serious nature of end-stage renal disease, patients require dialysis treatments three days per week. Therefore, we're not seeing a meaningful impact on the use of Amgen medications in these patients that can be attributed to COVID-19. In Q1, EPOGEN sales declined 29% primarily due to lower net selling price from our contractual commitment with DaVita and approximately $20 million of unfavorable changes in accounting estimates. Sensipar sales declined 42% year-over-year due to the impact of generic competition. As a reminder, supplemental patent protection certificates for cinacalcet have now expired in major EU markets, which could result in a significant decline in ex-U.S. sales in 2020. Parsabiv grew by 39% year-over-year in the first quarter. Independent and midsize dialysis providers already utilize Parsabiv for the majority of their calcimimetic patients, while FMC and DaVita continue to increase adoption. In summary, I'm truly inspired by the entrepreneurial spirit of our employees who are helping patients and healthcare providers in this unprecedented time. And with that, I'd like to turn over to Peter.

Peter Griffith, CFO

Thank you, Murdo. Good afternoon, everyone. Before reviewing our results and guidance, I would like to take a moment to build on Bob's comments regarding the unprecedented COVID-19 pandemic and provide additional insights into how we are responding to and navigating through the associated macroeconomic challenges. First, we confront these challenges from a position of strength. Our fundamentals are strong, with over $8 billion of cash and investments and a business that generated $2 billion of free cash flow in the first quarter. We remain committed to our capital allocation principles, which start with investing in internal innovation. We will patiently evaluate external business development opportunities that clear our hurdle rate and are consistent with our areas of therapeutic focus. Our capital expenditures remain a high priority, including our industry-leading environmentally friendly next-generation biomanufacturing facility in Rhode Island. We will continue to return capital to our shareholders. Our capital allocation principles will continue to build on our efficient capital structure which results in an optimal weighted average cost of capital. Now I will briefly walk through our first quarter financial results before discussing our 2020 guidance. The financial results are shown on Slide 29 of the slide deck. The first quarter marked another period of solid performance as we grew volumes by 15%, increased investments in the business, and delivered 17% year-over-year non-GAAP EPS growth. Q1 revenues at $6.2 billion increased 11% year-over-year. In the quarter, we saw worldwide product sales increase 12% to $5.9 billion, as our portfolio transitioned with strong growth from our newer products outpacing declines in our mature products. Now on to the rest of the P&L. Total operating expenses for the quarter increased 7% year-over-year. For the full year, we now expect total operating expenses to grow in the high single-digit percentage range year-over-year on an absolute basis. On a non-GAAP basis, cost of sales as a percent of product sales decreased by 1.6 percentage points to 13.1%, driven primarily by lower manufacturing costs, partially offset by an increase in milestone expense. For the full year, we continue to expect cost of sales as a percent of product sales to be generally consistent with 2019. Research and development expenses of $927 million were 8% higher due to higher spending on Otezla and AMG 510, partially offset by cost recoveries from our collaboration with BeiGene. For the full year, we also expect R&D spend on an absolute basis to increase as we invest in our innovative pipeline and new Otezla indications, with these increases partially offset by R&D recoveries received from our BeiGene collaboration. SG&A expenses increased 12%. And for the full year, we continue to expect SG&A spend to increase primarily due to Otezla spend. Our Q1 non-GAAP operating income at $3.2 billion increased 15% from the prior year. Non-GAAP operating margin was 53.9% for the quarter compared to 52.4% in Q1 of 2019. Other income and expenses were a net $335 million expense in Q1. This is unfavorable by $177 million on a year-over-year basis. This year-over-year change was due to lower interest income on cash balances, as well as market fluctuations of publicly traded securities held in our venture portfolio. We anticipate non-GAAP other income and expense to be a net expense toward the upper end of the $1.2 billion to $1.4 billion range we previously provided. Recall that we will begin recording under the equity method of accounting our share of BeiGene's profit or loss beginning in Q2. The non-GAAP tax rate decreased 1.8 percentage points versus Q1 2019 to 12.8%. Non-GAAP net income was $2.5 billion, a 17% year-over-year increase for the first quarter, supported by a 5% reduction in share count versus Q1 2019. Turning next to cash flow and the balance sheet on Slide 30. During Q1 2020, we generated strong cash flow reflecting a diversified portfolio of products coupled with an industry-leading cost structure. Free cash flow was $2.0 billion in Q1 2020 versus $1.7 billion in Q1 2019. In Q1 2020, we returned a total of $1.9 billion to shareholders through dividend payments totaling over $900 million and over $900 million to repurchase 4.3 million shares at an average price of $219 per share. For the remainder of the year, we plan to maintain our quarterly dividend of $1.60 per share and will execute opportunistic share repurchases that will result in an amount at the lower end of our previous guidance of $3 billion to $5 billion for 2020. Cash and investments totaled $8 billion at the end of Q1 2020, a decrease of $18.3 billion from the end of Q1 2019. This decrease was primarily driven by the Otezla and BeiGene transactions, cash returned to shareholders in the form of share repurchases, as well as net debt repayments, partially offset by free cash flow generated during the period. Additionally, I note in Q2 2020, we plan to make $1.75 billion in debt maturity payments. We issued $5 billion of long-term debt in February in order to take advantage of market conditions for refinancing our long-term debt maturities in 2020 and partially those in 2021. We will continue to be opportunistic with strong access to capital markets. Debt outstanding at the end of the quarter totaled $31.8 billion and carries a weighted average interest rate of 3.7%. Turning to the outlook for the business for 2020 starting on slide 31. Our guidance provided in January contemplated a broad range of outcomes. Due to the uncertainty related to the COVID-19 impact, we expect some degree of uncertainty in quarterly revenue and earnings over the year. We currently expect that we will see the greatest impact later in Q2, with stabilization and then partial recovery occurring during the second half of the year. And now turning to slide 32, we are reaffirming our guidance with a revenue range of $25.0 billion to $25.6 billion and a non-GAAP EPS range of $14.85 to $15.6. We will be monitoring the business as the dynamics underlying these assumptions evolve across Q2, and we'll review our latest perspectives with you at our next earnings call. We are now guiding to capital expenditures of $600 million versus our prior guidance of $700 million, reflecting a change in the timing of spend, rather than a change to our investment plans. Additionally, we are reaffirming our non-GAAP tax rate guidance of 13.5% to 14.5% for the full year. This concludes the financial update. I've been with Amgen a little over six months, and it’s a privilege to serve patients every day here by supporting and enabling the Amgen difference. Each day during this COVID-19 disruption, I'm reminded that innovation is the miracle drug. With that, I'll turn it back over to Bob for some closing remarks.

Bob Bradway, CEO

Well, before my closing remarks, we'll go to Q&A. So let's have Ian open it up for Q&A, and remind our callers of the process that we'll follow. Thanks.

Operator, Operator

Certainly. Our first question is from the line of Jay Olson with Oppenheimer. Jay, your line is open.

Jay Olson, Analyst

Hi. Thanks for taking the question. And thank you for the work that you're doing to fight the COVID-19 pandemic. I wanted to ask about the non-GAAP operating margin. It ticked up nicely in the first quarter. And I noticed that you lowered the OpEx expected growth rate slightly. So, I was wondering, how do you expect the operating margin to evolve over the course of 2020? And do you expect that higher operating margin to be sustainable in a post COVID-19 world? Thank you.

Peter Griffith, CFO

Jay, thank you for the question; it’s a good one. As I indicated, we do project that for the full year, our total OpEx will grow in the high single-digit percentage range. We are confident in our cost structure and our productivity work here at Amgen. So I think our operating margin speaks for itself and we expect it to be an industry-leading cost margin going forward in 2020. Of course, we don't give any guidance beyond 2020 on the margin.

Bob Bradway, CEO

Just to state the obvious, Jay, we would have liked to have spent more in Q1, but we were getting a little disrupted there at the end of the quarter. So we'll see what it's like for the remaining three quarters of the year.

Operator, Operator

And our next question is from the line of Tim Anderson with Wolfe Research. Tim, your line is open.

Tim Anderson, Analyst

Thank you very much. My question is something that's probably a thorn in your side, which is the ongoing Enbrel patent challenge. That's one of the bigger events for the company in 2020, the appeals court ruling. And I'm sure you're confident in your positioning on how that will play out. But these things are never certain. So, I'm wondering if you can just help us describe what Plan B would be in the event that Sandoz actually prevails as your largest product. I'm guessing you had some sort of contingency plan in place. I know it's a low probability event, but any perspective would be helpful?

Dave Reese, Head of R&D

Tim, we're not going to go into details on that. Obviously, we continue to feel confident in the intellectual property around Enbrel. So let's leave it at that for now. Thanks.

Operator, Operator

And our next question is from the line of Chris Raymond with Piper Sandler. Chris, your line is open.

Chris Raymond, Analyst

Thank you. I understand that you have discussed your collaboration with Adaptive in your antibody program. However, there are many companies, including Regeneron and others, working on similar products. Could you provide more details on what sets your approach apart? Additionally, can you elaborate on your timelines for entering the clinic? Thank you.

Dave Reese, Head of R&D

Thanks, Chris, Dave Reese here. I'll take that question. Yes. So, as you know there are a number of efforts going forward to develop therapeutic antibodies. And what we're trying to do, I think, that is potentially unique here is number one, combine Adaptive's capabilities in immuno-profiling with our immunology and particularly our genetics work based out of deCODE. Our goal also is to identify a very high-quality therapeutic candidate, and it's my belief that there may well be more than one generation of antibody therapeutics entering the clinic. So, as we think about this, we want to balance speed of development, which of course is important, with generating the highest quality candidate. As work progresses, we are up and running in the laboratory, but we will provide guidance in terms of clinical timelines as that work unfolds. But that collaboration is actively proceeding right now.

Bob Bradway, CEO

Chris, maybe I could just add a comment about manufacturing. Obviously, we produce a lot of protein. We have great expertise in manufacturing at scale. And we think one of the things we can bring to the party here is our ability to supply a vast number of patients with our antibody.

Operator, Operator

And our next question is from the line of Geoff Meacham with Bank of America. Geoff, your line is open.

Geoff Meacham, Analyst

Afternoon guys. Thanks for the question. I guess one for Bob. When you had the first full quarter of Otezla in the mix and now it looks like you have a pretty competitive growth profile in the industry from a top and bottom-line perspective? So, I know that's obviously fully expected, but does either the growth acceleration or the volatility from COVID affect your attitude towards business development? I'm just thinking about maybe a step-up in the number of deals, or maybe increasing appetite for larger ones in this environment? Thank you.

Dave Reese, Head of R&D

I think the environment is still quite fluid, Geoff. So, I'm hesitant to provide a definitive answer to your question at this moment. However, I want to emphasize that we believe we are in a strong position. We've discussed our balance sheet and our commitment to investing in both internal and external innovation. We're focused on our strategy and will assess whether there are external opportunities that can enhance our key areas. Additionally, I want to express my appreciation for my Amgen colleagues; we successfully integrated three significant transactions in the first quarter. Starting strong with Otezla, BeiGene, and our Japan transaction was a priority for us, and we feel we've accomplished that in the first four months of the year. So, I'm optimistic about that.

Operator, Operator

And our next question is from the line of Michael Yee with Jefferies. Michael, your line is open.

Michael Yee, Analyst

Thank you for the question. And congrats on all the progress, and appreciate the color during this tough time. My question was for David. On AMG 510, of course, you didn't mention you have an update at ASCO. Can you just remind us how to think about colorectal cancer as a monotherapy? I guess what was new there? And then excluding lung and colorectal, there's an update there. Can you just remind us what would be the relevance there? And then the timing on the combos which are not at ASCO? What to think about there and timing? I appreciate the update.

Dave Reese, Head of R&D

Thank you, Michael. Yes, we have several questions about AMG 510. We are still enrolling patients for monotherapy with colorectal cancer. As I mentioned earlier, we will review the data in the coming months to decide if there is a viable path for monotherapy in colorectal cancer or if combination therapy is the better option. Regarding other indications outside of lung and colorectal cancers, there are additional types of cancer, including a small portion of pancreatic cancer, appendiceal cancer, and endometrial cancer. We will provide updates on these tumors and their response data at ASCO. Lastly, concerning the combination therapy trial, we have paused some of these trials either because they had just started or were about to begin. We are preparing to resume them, and I expect to see some initial data by late this year or early next year. However, we are confident that the overall program has not faced significant disruptions, and we are quite pleased with its progress.

Operator, Operator

And our next question is from the line of Terence Flynn with Goldman Sachs. Terence, your line is open.

Terence Flynn, Analyst

Hi. Thanks for taking the question. Maybe a follow-up for me on AMG 510. I know you guys have guided to the Phase 2 lung cancer data in the middle part of this year. Just wondering now as we're closer to the data if you could share any perspective on what you view as kind of the efficacy bar here? Is Cyramza the right bar? Or should we think about higher efficacy here given it's a targeted drug? Thank you.

Dave Reese, Head of R&D

Thanks, Terence. This is Dave. Yes. In terms of the timing of the data, I'd point out that what we've indicated is that we want at least six months of response data on all patients. Given that the last patients were enrolled towards the end of last year, that it takes a month or two typically for responses to develop. You can see that that pushes it into the second half of the year in terms of when we expect the data readout. We're absolutely on track and we're not experiencing any, I would say, substantial hiccups in the Phase 2 monotherapy study. We do want robust duration of response and progression-free survival data as part of that package. I think those endpoints, along with response rate, will be an important part of the package in this Phase 2 monotherapy study.

Operator, Operator

And our next question is from the line of Yaron Werber with Cowen. Yaron, your line is open.

Yaron Werber, Analyst

Great. Thanks for taking my question as well. I have an AMG 510 question as well. The Phase 3, David, the study obviously is fairly sizable. It's 650 patients head-to-head against docetaxel. I think it kind of drew some questions as to why was docetaxel really used as the control and not Cyramza in combo? And maybe give us a little bit of sense why is this study so sizable? Should we read into your expectation on OR? Or is it really about trying to power for survival? Thank you.

Dave Reese, Head of R&D

Yes. Thanks, Yaron, for the question. In terms of the comparator arm, this choice was based on what remains one of the standards of care, docetaxel, around the world after discussions with regulatory authorities and investigators, we feel that that's an appropriate comparator here. The sample size calculations were driven by the desire to be able to robustly test for overall survival. So the second part of your statement there is correct. If this was powered on overall survival.

Operator, Operator

And our next question is from the line of Matthew Harrison with Morgan Stanley. Matthew, your line is open.

Matthew Harrison, Analyst

Great. Good evening. Thanks for taking the question. I just wanted to ask a question around stocking dynamics for the quarter. I know you called out a couple of one-time items and what you thought was the benefit from COVID. Could you maybe just put that in context? Obviously, normally in the first quarter you see a lot of destocking across the product lines. Did you not see that typical destocking? And so could that be also a potential benefit that's going to come out through the year? Maybe you could just comment on that? Thanks.

Murdo Gordon, Head of Commercial Operations

Yes. Hi, Matthew, it's Murdo. Yes, as I mentioned, we saw about $100 million of stocking inventory build, I should say, in the first quarter, which happened across markets. The only other element that I would maybe compare in contrast to some other companies that are reporting is our business, given that it's predominantly specialty biologics, I know a fair amount of physician administration products didn't necessarily have the same extent of early prescription fills and patient 90-day fills, that would have been an additional pull forward for some other companies. As they reported, they blended that dynamic with end customer and wholesale inventory build. So the $100 million refers to end customer and wholesaler inventory specifically. On products like Otezla, we may have had some pull forward from some early fills and maybe 90-day scripts. And we'll just have to wait and see how that works through in Q2.

Operator, Operator

And our next question is from the line of Robyn Karnauskas with SunTrust Robinson. Robyn, your line is open.

Robyn Karnauskas, Analyst

Hi, guys. Thank you so much and great work on running the business in this time. So can I take a broader step back question? I know we've been focused on a lot of specific questions. You guys have had a lot of experience during this financial crisis and people switching from a commercial payer to a Medicare or government payer. Help us think about how you managed that? How you get people quickly to switch? And how you manage the impact of that? And then secondly for telemedicine, how comfortable are prescribers writing to Evenity? And how do you think that telemedicine really impacts your business? I know that's a new one for you? Thank you.

Bob Bradway, CEO

Robyn, before Murdo answers, let me make sure we heard that you said how comfortable are we writing or are doctors writing? Did you say Evenity prescriptions in telemedicine?

Murdo Gordon, Head of Commercial Operations

Right. Yes, Robyn, if I could just clarify further on the first part of your question, is your question related to opening up government access like we've done over the last little while? Or is it the transition of people potentially from commercial to a government benefit because of COVID-19?

Robyn Karnauskas, Analyst

It's really transition. So what a lot of people are asking is: if we transition—given a potential, a lot of people at work, they're going to transition to a government-based plan. You've been through this before, so you're one of the few companies that can probably tell us how you manage that? And how you'll run the business, and you think the impact might be?

Murdo Gordon, Head of Commercial Operations

Okay. No, that's helpful. Thanks for the clarification. So, let's start with that topic. First off, our overall Medicaid portion of our business right now is quite low. It's less than 10% of our total revenue. The majority of our products beyond that are reimbursed through Medicare Part B and D, with about 50% of our total business being reimbursed through commercial. So it's that commercial piece, as you rightly point out, that is likely—or a portion of that is likely to transition to a government channel. Now the thing that's harder to predict is at what rate? So, as people who become unemployed and an important distinction is that furloughed employees retain benefits for a period of time if they opt into Cobra, and furloughed employees are often still on their self-insured company employee plan. So there's a time lag that's going to occur before people transition to either a state exchange or a Medicaid benefit. So I think the impact could be a delayed one, more like towards the end of this year and into 2021. And of course, trying to pin down the actual numbers of Americans that are going to end up in unemployment benefits is hard to peg right now. So those are the two things. It's the total bolus and the rate of change. I've heard some commentary and read some things that would appear to indicate people expect it earlier. Our perspective is that some of these patients and people will transition over time, and it will more likely be a delay to an effect into 2021. On telemedicine, I would just say that there's a variety of maturity of how telemedicine is used by therapeutic area. If you think about mental health—and I would argue even in neurology—telemedicine is already used quite extensively, even pre-COVID. I would say that the uptake for telemedicine and evaluating someone like a migraine patient is going to be relatively straightforward as it would be perhaps for a dermatology patient. So in the case of neurology, migraine would be Aimovig, and then for dermatology, it would be Otezla. Evenity is primarily prescribed post-fracture, so patients are likely to be in a clinic or a hospital setting. The ability for the physician to evaluate the patient and prescribe Evenity is probably pretty straightforward related to that acute event. We're watching it closely. Because of Aimovig and other brands that—where telemedicine was already being used fairly extensively, we had some experience here that goes back over a year and we've been scaling our experience there now. I think Amgen will be on the front foot when it comes to building out our capabilities in that area.

Operator, Operator

And our next question is from the line of Ronny Gal with Bernstein. Ronny, your line is open.

Ronny Gal, Analyst

Hi. Good evening. And let me add my thanks to Dave for all the work you're doing on COVID-19. Two, if I may. First for David, the PD-1, and you expanded that work a couple of times; you started with about 40 patients, now you have about 270 patients. Given that you're originally a little bit skeptical at Amgen about PD-1, is this just looking for ways to leverage the same protocol to do more? And what does that mean about your ability to bring that product to market and timing? And then to Murdo, you've done fabulously well with about—as I, by my count, you did about $320 million this quarter. Now, we have Pfizer coming in the United States, they've taken a bit more price decreases. What is your expectation for the rest of the year? If you can also mention what you guys are doing with your REMICADE biosimilar; kind of an interesting product?

Dave Reese, Head of R&D

Well thanks, Ronnie. This is Dave. I'll start with the PD-1 question for AMG 404. We continue to develop AMG 404 primarily as a combination partner for our pipeline agents. This is a Phase I umbrella study, and we added cohorts to study additional indications where the tumors in question have well-described PD-1 sensitivity. That will limit the need, we hope, for single-arm data in future trials, and ultimately we think we'll probably need on the order of 200, give or take, monotherapy patients to support the standard safety package for AMG 404. All of that put together—the expansion of the Phase I trial allowed us an efficient way to generate appropriate data.

Murdo Gordon, Head of Commercial Operations

Yes. And when it comes to our biosimilars business, we are pleased with the run rate of over $300 million in the quarter. I would say—I would attribute our success first and foremost to Amgen's reputation as a high-quality biologics manufacturer. I think that is something that differentiates us and is perceived well by our customers. Our experience in Europe was a very positive one. We applied those lessons learned to our U.S. launches of the two oncology biosimilars, and I think it shows you that the biosimilars market is functioning well in the United States. I would also say that the biosimilar business model for Amgen is very much integrated with our innovative products. The same people who are defending Neulasta, the same account managers who are defending Neulasta day-in day-out and making sure that the benefit of OnPro is understood by our customers are the same people who are establishing the uptake curve for MVASI and KANJINTI. So those account relationships that we've cultivated over many, many years in oncology have been extremely valuable. Our relationships at the payer-provider level, I think, have helped us extend that trajectory nicely. I would also say that our patient services are exemplary, and we have the very same patient services that we have for a product like KYPROLIS or XGEVA we apply to our biosimilars business as well. And then you mentioned, I think, Avsola, which is our Remicade biosimilar. We do intend to launch that this year. That product will help strengthen what is already a strong immunotherapy portfolio for us and will help us broaden out that customer perspective. Again, that product will be integrated with our innovative autoimmune portfolio.

Bob Bradway, CEO

Ian, let's proceed with the next question. Since it’s getting late on the East Coast, I kindly ask everyone to limit themselves to one question. Ian, please continue with the next inquiry.

Operator, Operator

Certainly. Our next one is from the line of Evan Seigerman with Credit Suisse. Evan, your line is open.

Evan Seigerman, Analyst

Hi guys. Thank you so much for taking the question. And, kind of, a follow-up from what you were just talking about, Murdo. So how has the pandemic impacted the uptick of biosimilars? Have you seen an acceleration in adoption to save costs? Or have centers really delayed uptake given potentially overwhelmed systems? Thank you.

Murdo Gordon, Head of Commercial Operations

So it's a bit early to tell, so take my comments with a very few weeks of experience here. I would say so far we have not seen a negative effect on our uptake. If anything, we're seeing a steepening of our uptake curve. The one thing I will say that we haven't yet assessed that could happen is the total cycles of bevacizumab or the total cycles of trastuzumab could be impacted. So from a share of molecule perspective, we're very pleased. What we're watching is the total number of infusions of each of the molecules going forward.

Operator, Operator

And our next question is from the line of Dane Leone with Raymond James. Dane?

Dane Leone, Analyst

Hi. Thank you for taking the questions and the update. I just want to ask a business development question, and I'll just keep it to one here. When you're thinking about ramping up your efforts with KRAS, obviously, the initial data set is great for how you're thinking about the target oncology space. Thinking about that and then also thinking about the bolt-on with Otezla that you did to start broadening out how you think about immunology, where do you want to go in those respective areas from a biz dev perspective? I mean, there's a lot of room you guys still have to work with, especially in target oncology. Should we be expecting more bolt-on acquisitions within these two areas over the course of 2020?

Bob Bradway, CEO

I don't know about the course of 2020, Dane. Those are two areas of keen interest for us, for sure, oncology and inflammation. We will continue to look for attractive innovative assets that we think we can add value to. The trick is always to be able to license or acquire molecules at a price that leaves a return for our shareholders, and we're pretty comprehensive in the way we assess the marketplace, and we'll continue to keep an active watch and see whether there are some things that might be a good fit.

Operator, Operator

Great. Thank you.

Umer Raffat, Analyst

Hi, I just learned how to unmute myself. So thank you so much. David, one question for you, if I may. I think it will be very helpful for investors to understand if you're optimistic on the durability of response with KRAS monotherapy? And if you're starting to develop a view whether a MEK or a PD-1 as a better combination partner? Thank you so much.

Dave Reese, Head of R&D

Thank you, Umer, for the question. Yes. I mean, I think duration of response is one of the critical questions, and that's why I indicated that the Phase II trial I think is going to give us the definitive answer there. That will—and we wish to have enough follow-up to very robustly address both duration of response and progression-free survival. In terms of the combinations, I think it's perhaps a little too early to pick favorites. We are looking at a number of combinations, which is typical for oncology programs. All of those are based on an underlying biological rationale, and as I indicated, we'll be generating data in that program in combinations over the course of this year.

Operator, Operator

And next we have a question from the line of Michael Schmidt with Guggenheim. Michael, your line is open.

Michael Schmidt, Analyst

Hi, guys. Good evening, and thanks for taking my question. I had a high-level question on the biosimilar business, which has been going really well for Amgen. I'm just wondering, as we see the biosimilar market mature longer-term and as we see potentially more product launch within these markets, I guess, what is your view on the long-term price erosion relative to brand? And how should we think about a potential floor relative to the manufacturing and development costs in the biosimilar area? Thank you.

Murdo Gordon, Head of Commercial Operations

Yes. Thanks, Michael. The one thing I mentioned earlier in response to the question on biosimilars was the Amgen experience in knowing how to make biologics at scale in a very efficient way. So we have really good margins on this business. And I think going by our experience in Europe, where I would argue that the price degradation has probably been faster than it will be in the U.S., even with multiple competitors, we've been able to compete effectively for volume and we've been able to retain a very profitable business there. We, obviously, don't have a lot of analogs in the U.S. to understand the rate of change, so I'm going to hold back from speculating on what the future will hold. But there are clear things here that the more competitors you have compressed in the early phase of a biosimilar launch path, the more likely there is to be some precipitous price erosion. We're fortunate that we were early in the U.S. with both MVASI and KANJINTI and able to establish a very strong foothold in the market. I'll also repeat it. I said it earlier, but I do think that the biosimilar market is alive and well in the U.S. and functioning as you would hope free markets would.

Operator, Operator

And our next question is from the line of Carter Gould with Barclays. Carter, your line is open.

Carter Gould, Analyst

Thanks for fitting me in. I guess, maybe, just a bigger picture question around sort of the lasting impact of COVID. When you guys think about, either shift to manufacturing strategy, location, bigger picture questions on footprint, and I guess, as well as commercialization models. I guess, it's just a really kind of a bigger picture question. When we return to normal, would that look different to sort of your infrastructure and business model, as how you have set it up historically? Thank you.

Bob Bradway, CEO

Yes. That's a really interesting question, Carter, and one that I think we'll get a lot of attention once things have settled down a little bit. It's still awfully fluid to be trying to predict how the experience of COVID-19 will affect our industry or our business model. But we'd be happy to engage with you on that topic in greater length, again, when the dust has settled a little bit. Fundamentally for us, our supply chain is in great shape. We, unlike some of our peers in the industry, predominantly manufacture in the U.S. Obviously, even the people who work for us there are U.S. citizens, and so we have the benefit that the vast majority, nearly all of our manufacturing is done in the U.S. That supply chain question is a little bit less relevant for us and some of our industry peers. This isn't going to be the last viral challenge that we face as a society, and I think we'll all be trying to improve our business continuity planning and thinking when we come out of this to make sure that we're in the strongest position possible to avoid interruptions from events like this. But I think there will be a lot of learning across the whole economy, including the biotech economy. So we look forward to talking with you at the right time.

Operator, Operator

And next we have a question from the line of Mohit Bansal with Citi. Mohit, your line is open.

Mohit Bansal, Analyst

Great. Thanks for taking my question, and congrats on all the progress. I have a quick question regarding your IL-2 mutant program. What is your level of excitement around this program? Seems like you have two fully enrolled trials at this point. Should we expect to see any data from this program later this year? Thank you.

Dave Reese, Head of R&D

Thanks, Mohit. Dave here. Yes, we remain keenly interested in AMG 592 IL-2 mutant. We're enrolling trials going forward, and we'd expect data over the course of the year or perhaps early next year. Some of those trials we did temporarily pause because of the reluctance of investigators to start patients on new immunomodulatory agents in the course of the epidemic. We remain quite interested in that program, and we'll provide guidance as to when we're going to get data readouts as we move forward.

Operator, Operator

And next we have a question from the line of Kennen MacKay with RBC Capital Markets. Kennen, your line is open.

Kennen MacKay, Analyst

Hi. Thanks for taking the question. Maybe for Peter or Bob. Actually, I'd love to hear Dr. Reese's perspective. I was wondering where you are seeing the most opportunity for M&A and really where you're focused there? And Dave, I had hoped to include you in that question really just to get your perspective on where some of the most interesting biology and chemistry is taking place now and what Bob has referred to so eloquently as the golden age of biotechnology. Thanks so much.

Bob Bradway, CEO

Well, Dave, since I talked a little bit about M&A business development already on the call, why don't we let you take a crack at this. So, what areas, what mechanisms are most intriguing to you and your R&D colleagues at the moment?

Dave Reese, Head of R&D

Yes, I think it is a golden age and I would approach it from two perspectives. There are new platforms, and our Head of Research, she has published a very great article in Nature a week or two ago. I'd encourage all of you to read about what we call an induced proximity platform. This is a new suite of technologies that we think can open up much of the undruggable space. That sort of business development remains of great interest to us. And then, as we've said before, I think there's a ferment of activity across the therapeutic areas of great interest to us, and that will continue to be a focus going forward.

Operator, Operator

And next we have a question from the line of Salim Syed with Mizuho. Salim, your line is open.

Salim Syed, Analyst

Great. Thanks so much for that question, guys. Bob, maybe just one for you just a high-level one. Given your discussions with folks in Washington, obviously the rhetoric in biotech and pharma has been pretty negative over the last few years, especially around drug pricing, etc. And I'm wondering with given this COVID-19, has that changed the rhetoric at all in your view? And is there anything sustainably positive that can carry on post-COVID in terms of rhetoric coming out of Washington in your view? Thank you.

Bob Bradway, CEO

Well, I think everybody recognizes that we're going to need science and innovation to lead us out of this challenge that we find ourselves in globally. So the importance of innovation and a little bit of humility, perhaps, in all camps about how hard it is to have the right innovation available for the world at the right time. So the good news is that the government, innovators, academia, and everybody are working together at a speed and a scale that I've never seen in my career. I think that's a good sign, and hopefully, we'd be able to look back on this one day and say that it worked. We've got a special ecosystem, in particular, in this country. Hopefully, we'll be able to look back and say when we faced the biggest challenge of our lifetimes, the industry came through and delivered what we needed. If we're able to do that, I think it inevitably will help remind everybody that we haven't generated all the innovation we need as a society. There are still lots of areas of unmet medical need. The more we can do to address it, the better. But the question of drug pricing is not going to go away, but hopefully, there'll be some respect for how profoundly important innovation is.

Arvind Sood, Vice President of Investor Relations

And let's take one last question if there's a quick one, after which I'll ask Bob to make some concluding comments.

Operator, Operator

Very well. Our final question is from the line of Jim Birchenough with Wells Fargo Securities. Jim, your line is open.

Jim Birchenough, Analyst

Good afternoon. It's Nick on for Jim. Thanks all very much for squeezing us in. You had mentioned earlier in your prepared comments about Otezla, the role of Otezla in COVID. Can you just elaborate on that? And is this in the acute setting? Or perhaps is there an opportunity for patients who have ongoing organ dysfunction after they leave the hospital, maybe due to inflammation?

Dave Reese, Head of R&D

Well, thanks, James. This is Dave. Yes, we think it's actually—there will be utility in studying Otezla in a variety of settings, ranging from, for example, hospitalized patients but those that are not yet in the ICU to attempt to prevent progression to more serious disease, as well as those with more serious disease. Again, we're in active discussions or have committed to platform trials. The one real guiding principle we have here is that we want these to be rigorous studies to provide the highest quality answers.

Bob Bradway, CEO

Okay. Let me just wrap up, recognizing that it's pushing on 7:00 on the East Coast. Again, let me reiterate our appreciation for you joining the call. I hope what you take away is that we delivered a solid quarter one. We feel we're executing the business well. Our objective will be to remain an effective steward of the business through the short term. We want to be a leading corporate citizen through this challenging period as well, and we will remain focused on delivering long-term growth by advancing innovation in those areas that you're familiar with at Amgen. So thank you all. Keep safe. Look forward to catching up with you on the next quarterly call.

Arvind Sood, Vice President of Investor Relations

Thanks everybody. Myself and the IR team will be around for some time. So feel free to reach out to us. Thanks again.

Operator, Operator

Ladies and gentlemen, we thank you greatly for joining us for Amgen's First Quarter 2020 Financial Results Conference Call. This does conclude the call. You may now disconnect.