What trends are visible in Amgen's operating expenses?

Amgen's operating expenses exhibit several notable trends:

1. **Increase in Operating Expenses**: Amgen's adjusted operating expenses have shown a significant upward trajectory, rising by 27% to $4.46 billion in the third quarter of 2024 compared to the same period in the previous year. This increase is particularly notable in research and development (R&D) expenses, which have risen by 35% to $1.44 billion.
2. **Rising Trend in SG&A Spending**: The selling, general, and administrative (SG&A) expenses have also seen a notable increase, growing by 21% to $1.57 billion. This suggests a strategic expansion or restructuring that may be supporting the company's growth in sales and acquisitions, such as the Horizon Therapeutics acquisition.
3. **Impact of Acquisition on Operating Expenses**: The acquisition of Horizon Therapeutics has had a substantial impact on Amgen's operating expenses. The incremental expenses from Horizon, including amortization expense and other acquisition-related costs, have contributed to the overall increase in operating expenses. For instance, the acquisition contributed $954 million in sales from October 6 to December 31, 2023.
4. **Growth in Product Sales Driving Expenses**: The growth in product sales, which has been driven by volume growth and the addition of new products like those from the Horizon acquisition, is contributing to the rise in operating expenses. For example, product sales grew by 24% year-over-year to $8.15 billion, with higher volumes partially offset by lower selling prices.
5. **Operating Margin Pressure**: The increase in operating expenses has put pressure on Amgen's operating margins, with the adjusted operating margin declining to 49.6% in the third quarter. This decline reflects the costs associated with growth and the integration of acquired businesses.

In summary, Amgen's operating expenses are on an upward trend, primarily driven by strategic initiatives such as the Horizon acquisition and the resulting increase in product sales. However, these expenses are putting pressure on the company's operating margins, which may require careful management to maintain profitability.