Moody's cuts Amgen view to negative

Moody's Investors Service said it revised its outlook on Amgen Inc. to negative from stable.

The agency also assigned A2 ratings to Amgen's new $4 billion offering of senior unsecured notes and $1 billion bank credit facility due 2010 and affirmed the company's senior unsecured notes, debentures, LYONs, zero-coupon convertible notes, medium-term notes, senior unsecured convertible notes due 2011 and senior unsecured convertible notes due 2013 at A2 and its short-term rating at Prime-1.

Of the proceeds from the new notes, $3 billion will be used to purchase shares of common stock on or about the closing date of the offering and the remainder will go toward general corporate purposes including capital expenditures, working capital needs and other business initiatives.

The outlook revision reflects Moody's view that the timing and amount of the debt-financed share repurchase is aggressive at a time when Amgen's operating risk profile has increased and its cash flows face new uncertainties that may affect its cash flows in 2007 and beyond, including the degree to which providers may change their usage of Aranesp and Epogen in light of safety questions, whether Centers for Medicare & Medicaid Services adopts a recently proposed coverage change that would eliminate Medicare reimbursement for many approved uses of Aranesp and whether Roche launches Mircera in the U.S. market in 2007.

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