In 1985, Amgen Inc. licensed some of the rights to its first product – Epogen (erythropoietin alfa) to promote red blood cell production in non-dialysis patients – to a subsidiary of Johnson & Johnson (J&J). That transaction provided Amgen a much-needed 5% royalty on non-dialysis sales in the US, and for all indications outside the US for no selling or marketing cost. The strategic marketing agreement also provided the wider but nascent biotech sector with a good dose of validation and implied that the (then) orphan indication was commercially significant enough for J&J to devote its marketing muscle and expertise. As Amgen retained the rights to market Epogen in the US for dialysis patients, the relationship also allowed Amgen to learn the best practice of pharmaceutical marketing from J&J.
The success of Epogen exceeded at least Amgen’s expectations at the time the agreement was signed, but brought with it...
