Post by icemandios on Mar 16, 2023 13:36:40 GMT
March 15, 2023 02:51 PM EDT
Pharma
Law
Amgen sued in federal court for allegedly hiding $10.7B IRS bill from investors
Paul Schloesser
Associate Editor
Almost a year after Amgen told investors that the IRS wanted billions of dollars in back taxes, a Detroit pension fund is taking on Amgen in federal court — proposing a class action jury trial against the pharma giant.
In the 42-page complaint (case 1:23-cv-02138-ER) filed in federal district court in Manhattan on Monday, Roofers Local No. 149 Pension Fund sued Amgen, CEO Robert Bradway and CFO Peter Griffith, accusing the company of hiding its tax information from investors and delaying reporting of the claimed back taxes — effectively making “false and misleading statements,” according to the filing.
The fund also claimed that Amgen’s share price fell 6.5% on Aug. 4, 2021, and 4.3% on April 28, 2022 after multiple notices came out that implicated how much Amgen owed per what the US government claimed, “ultimately causing investors to suffer hundreds of millions of dollars in losses when the truth was belatedly revealed,” according to the filing.
The issue first came to light in the pharma giant’s first-quarter earnings last year, after Amgen reported it received a notice from the IRS that it was looking at Amgen’s profit allocation between the US and Puerto Rico from 2010-2015. At the time, the concern was that Amgen owed Uncle Sam somewhere north of $7 billion.
Some of Amgen’s main manufacturing facilities are located in Puerto Rico.
An Amgen spokesperson told Endpoints News that the company believes the allegations “are without merit” and that it “will vigorously defend our position in court.”
The spokesperson also highlighted a note sent to investors by investor relations VP Arvind Sood, sent at an undated time, that even further broke down Amgen’s rationale on how much is subsequently owed out of the original $10.7 billion balance.
Per the VP’s note, of the $10.7 billion, $2 billion is “wholly unwarranted,” and another $2 billion results from IRS errors in “accounting for certain income and expenses.” On top of that, Amgen says that any payment would go down by $4.2 billion — $1.1 billion from a previous deposit and the other $3.1 billion in repatriation tax from the 2017 tax reform law that passed back under the Trump administration.
“Thus, in our view the IRS proposed adjustments and penalties are overstated by several billions,” the note added.
Amgen has been looked at before for its low tax rate. Senate Finance Chair Ron Wyden (D-OR) reached out to Amgen late last year asking for “voluntary compliance” to provide financial information on how it ended up paying a lower tax rate than the standard 21% US corporate tax rate.
Pharma
Law
Amgen sued in federal court for allegedly hiding $10.7B IRS bill from investors
Paul Schloesser
Associate Editor
Almost a year after Amgen told investors that the IRS wanted billions of dollars in back taxes, a Detroit pension fund is taking on Amgen in federal court — proposing a class action jury trial against the pharma giant.
In the 42-page complaint (case 1:23-cv-02138-ER) filed in federal district court in Manhattan on Monday, Roofers Local No. 149 Pension Fund sued Amgen, CEO Robert Bradway and CFO Peter Griffith, accusing the company of hiding its tax information from investors and delaying reporting of the claimed back taxes — effectively making “false and misleading statements,” according to the filing.
The fund also claimed that Amgen’s share price fell 6.5% on Aug. 4, 2021, and 4.3% on April 28, 2022 after multiple notices came out that implicated how much Amgen owed per what the US government claimed, “ultimately causing investors to suffer hundreds of millions of dollars in losses when the truth was belatedly revealed,” according to the filing.
The issue first came to light in the pharma giant’s first-quarter earnings last year, after Amgen reported it received a notice from the IRS that it was looking at Amgen’s profit allocation between the US and Puerto Rico from 2010-2015. At the time, the concern was that Amgen owed Uncle Sam somewhere north of $7 billion.
Some of Amgen’s main manufacturing facilities are located in Puerto Rico.
An Amgen spokesperson told Endpoints News that the company believes the allegations “are without merit” and that it “will vigorously defend our position in court.”
The spokesperson also highlighted a note sent to investors by investor relations VP Arvind Sood, sent at an undated time, that even further broke down Amgen’s rationale on how much is subsequently owed out of the original $10.7 billion balance.
Per the VP’s note, of the $10.7 billion, $2 billion is “wholly unwarranted,” and another $2 billion results from IRS errors in “accounting for certain income and expenses.” On top of that, Amgen says that any payment would go down by $4.2 billion — $1.1 billion from a previous deposit and the other $3.1 billion in repatriation tax from the 2017 tax reform law that passed back under the Trump administration.
“Thus, in our view the IRS proposed adjustments and penalties are overstated by several billions,” the note added.
Amgen has been looked at before for its low tax rate. Senate Finance Chair Ron Wyden (D-OR) reached out to Amgen late last year asking for “voluntary compliance” to provide financial information on how it ended up paying a lower tax rate than the standard 21% US corporate tax rate.