Gillian R. Brassil (Bloomberg): Amgen Settles Investor Suit Over Tax Liability for $74 Million:
Amgen Inc. agreed to cough up $74 million to resolve allegations that the pharmaceutical giant delayed alerting investors that it may owe the IRS $10.7 billion in back taxes and penalties.
The proposed settlement class includes those who acquired Amgen stock from July 29, 2020, to April 27, 2022, the pension fund leading the case told the US District Court for the Southern District of New York Monday. If approved by the court, the deal would resolve more than three years of litigation over whether Amgen and two top executives put off telling investors about the amount of money the IRS demanded after it accused the company of transfer pricing — shifting profits to a subsidiary — to lower corporate income taxes.
The IRS told Amgen in 2017 and 2020 that it was seeking that amount over two periods — but the company didn’t disclose the full bill until April 2022, sending share prices plummeting, according to the investor lawsuit.
This was one of multiple shareholder lawsuits filed in the wake of the IRS bill. Amgen’s practice of allocating billions in income to its subsidiary in Puerto Rico drew regulatory scrutiny, with the IRS demanding about $8.7 billion in purportedly underpaid taxes over the course of six years plus $2 billion in penalties.
Amgen challenged the IRS in US Tax Court; a decision there is pending.
Judge John P. Cronan in 2024 denied the defendants’ bid to dismiss this proposed securities class action, holding that the pension fund adequately alleged Amgen, its CEO, and chief financial officer acted at least with reckless disregard of defrauding shareholders by withholding information about the scope of the potential liability.
“Amgen has reached an agreement to settle this case, subject to court approval,” a spokesperson said in an emailed statement. “We continue to believe that the claims in this case are without merit and the settlement includes no admission of liability or wrongdoing.”
Robbins Geller Rudman & Dowd LLP, lead counsel for the pension fund, didn’t immediately respond to an email seeking comment. Skadden, Arps, Slate, Meagher & Flom LLP represents Amgen, CEO Robert A. Bradway, and soon-to-retire CFO Peter H. Griffith.
The case is In re Amgen Inc. Sec. Litig., S.D.N.Y., No. 1:23-cv-02138, motion 7/20/26.
