A Time for Growth: An Interview with Amgen CEO Kevin Sharer
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Kevin Sharer knows something about growth. After stints as an officer in the U.S. Navy’s nuclear submarine program and as a junior consultant at McKinsey, the Annapolis graduate went to work for General Electric in 1984. There, he served as a staff assistant to Jack Welch and later as general manager of two divisions, first software and then satellites, both in fast-growing and rapidly changing industries. He joined MCI in 1989 as head of sales and marketing, rising to president of the business markets division during a period of spiraling growth at the upstart long-distance provider. In 1992, he came to Amgen as president, chief operating officer, and heir apparent to CEO Gordon Binder. He became CEO in May 2000, when Binder retired, and chairman in January 2001.


Amgen grew to be the world’s largest biotechnology company based on the success of just two products, both developed in the late 1980s: Epogen (an anti-anemia drug for kidney dialysis patients) and Neupogen (an anti-infection drug for cancer chemotherapy patients). Sharer’s aim as CEO has been to broaden the company’s offerings. One move has been the expansion into “small molecule” products, traditional chemical-based pharmaceuticals that can be formulated as pills. (Biotechnology’s “large molecule” products are proteins that must be injected.) Sharer also has worked to boost the output of the company’s R&D labs. Although the only new products to hit the market since Sharer became CEO are Aranesp (a second-generation anti-anemia drug that lasts longer between injections than Epogen) and Neulasta (a second-generation anti-infection drug with similar benefits over


Neupogen), both have been big successes. Finally, Sharer has formed alliances with other biotech firms and gone on an acquisition campaign. The most significant acquisition has been Amgen’s $11 billion purchase in 2002 of Immunex, the third-largest biotech company and the maker of Enbrel, a drug used to treat inflammation in arthritis patients.


These moves have spurred impressive growth. Revenue this year is expected to be around $10 billion, up from about $3 billion four years ago. Earnings could hit $3 billion, up from $1 billion. The market has at times been cautious in rewarding this growth, reflecting concerns about the company’s product pipeline, Medicare reimbursement for its products, and challenges to its patents. But it’s been a heady ride so far.


With the launch of its new products, Amgen has faced serious competition for the first time. Years ago, the company sold to Johnson & Johnson the exclusive rights to market Epogen (under the J&J brands Procrit and Eprex) for nondialysis-related uses, including the anti-anemia treatment of chemotherapy patients. But because of a favorable legal ruling, Amgen has been able to enter this lucrative field with its new anemia drug, Aranesp, precipitating a fierce battle with J&J. In addition, Enbrel, the product that Amgen acquired when it bought Immunex, goes head-to-head against anti-inflammation products made by, among others, Johnson & Johnson.


Competition requires the company to adopt a new mind-set, Sharer says. His office at company headquarters in Thousand Oaks, California, is decorated with paintings from his personal collection—some of them aggressive enough that colleagues have asked that they be removed from public areas. For example, a menacing work by British artist Ray Richardson depicts an unsavory-looking character pointing out of the frame to something—someone?—lying on the ground. Centrally positioned is a portrait of General Custer. It’s a reminder, explains Sharer, that “you’d better not underestimate your competitors. You might lose everything.” Next to it, though, is a portrait of Custer’s Native-American scout with a different message—that “a leader’s actions can have a devastating effect on others.”


In this edited conversation with HBR senior editor Paul Hemp, Sharer talks in depth about how a “leader’s actions” must be tailored to meet the demands of a high-growth environment.


What was your most unexpected lesson in leading for growth?


It was probably something I learned before I came to Amgen, way back in 1989, when I left GE and joined MCI as head of sales and marketing. It was a period of extremely rapid growth at MCI. Although I had no background in the industry, I was pretty cocky. I remember thinking, “Boy, they’re getting one of GE’s youngest VPs. Aren’t they lucky?” And within three months I went to the CEO, Bert Roberts, and announced that we had the wrong conceptualization of the business. Among other things, I told him that we should be organized by markets rather than by geography. Ultimately, my ideas were for the most part accepted and implemented. But that didn’t matter. The way I went about making my views known guaranteed I was immediately isolated.


At GE, a new senior manager was expected to make quick and dramatic change aimed at strengthening the business, and I came into MCI with that ethos. Well, you could do that at GE, but as a newcomer to MCI, this was exactly the wrong approach.


The division presidents, whom I relied on to carry out my sales and marketing initiatives, saw me as an adversary who was trying to reorganize their jobs rather than as an ally trying to win the brutal fight against AT&T. The very people I needed felt I wasn’t working in their personal best interests—which was true, in a way. I was working in what I thought were the best interests of the company. But I was doing the right thing in the wrong way.


It took me nearly a year to figure this out. Finally, Bert Roberts called me into his office and said, “Look, Kevin, I’ve heard from a lot of the division presidents, and you’ve got real problems. You’ve got to quit trying to do their jobs.” This stern warning really surprised me. But I was lucky to get it. The pre-WorldCom MCI was like a motorcycle gang out to do just one thing—get AT&T. That’s how tough we needed to be if we were going to bring down a giant. When the gang members got nasty toward one another, though, there was bound to be collateral damage!


So I learned the hard way that you need to become credible and enlist support inside the company before you start trying to be a change agent. If you think you’re going to make change happen simply by force of personality or position or intellect, you’d better think again.


So what did you do differently when you joined Amgen as president and heir apparent? Again, you were an outsider—and a somewhat unlikely one at that.


Right, here I was, this guy from the telephone business. The Wall Street Journal compared my arrival to John Sculley’s arrival at Apple. Hiring me was definitely an out-of-the-box move by CEO Gordon Binder. He was a former CFO in a company of scientists, and I think he felt he needed a deputy who shared his business orientation. He knew that I probably could help out in sales, marketing, manufacturing, and engineering. And I guess he figured that if he’d hired the wrong guy, he’d know it in two or three years and could fire me, leaving enough time to find another successor.


Amgen was already tremendously successful when I got here in 1992. There were about 2,000 people, sales were a little over $1 billion, and the company was the leader in an industry — about which I knew nothing. My last brush with health care was ninth-grade biology.


So I set out to learn the business from the ground up—and to show my desire to learn. I listened in executive meetings. I made calls with sales representatives. I asked one of our scientists—a midlevel researcher named Gene Medlock, who was about my age and an easy guy to like—to teach me biology. He gave me reading assignments, and we’d have regular sessions in his office in front of a blackboard. Seven years later, as I was preparing to become CEO, I took six months and devoted roughly half my time to furthering my knowledge: I spent time in our labs, got tutored by a PhD biologist from McKinsey, and visited research chiefs at several pharmaceutical and biotechnology companies.


If I hadn’t had that chastening experience at MCI, I could easily have blown up early on at Amgen. As it was, I became an insider before I started to make changes. And so by the time I became CEO, I’d already made enough changes that some people said it looked like a takeover from the inside. And it kind of was.


“If I hadn’t had that chastening experience at MCI, I could easily have blown up early on at Amgen.”


While yours was a fairly natural ascension to the CEO position, you have since shaken up the company in significant ways. Surely not everyone has been happy with this.


Yes, for Amgen to get to the next stage of growth, we needed to overcome some ingrained perceptions. Our first two products, Epogen and Neupogen, had been enormously successful. This led some people at Amgen to conclude that marketing isn’t necessary if you have great products. Indeed, some viewed marketing as a threat to our science-based research and product development. “Science will provide” was kind of a mantra. Related to this was the belief that, because we had such great science, there wasn’t much outside the company that we could benefit from.


But marketing was important. Even if we produced the greatest drugs in the world, we’d be in trouble if we couldn’t get doctors to prescribe them or insurers to pay for them. As for our reluctance to look outside the company for ideas, I like to say that 0.1% of the biologists in the world work at Amgen. Those other 99.9% care about disease just as much as we do and are generating ideas that we should be aggressively looking at. There was another problem. When our only two products were Epogen and Neupogen, we had operated as a de facto monopoly. As we launched new drugs, we began to feel for the first time the heat of competition from the likes of Johnson & Johnson and Abbott Labs. So some changes had to be made.


Still, I didn’t come to these conclusions in a vacuum. When it was announced in December 1999 that I was going to become CEO the following year, I asked the top 150 people in the company to meet with me for an hour each—150 hours in total. And I gave each of them the same five questions, which they received in advance: What three things do you want to change? What three things do you want to keep? What are you most worried I might do? What do you want me to do? Is there anything else you want to talk about? And I just listened for an hour. Many of the people came in with stuff written down, and in the case of those who didn’t, I took notes. And then I tabulated all the responses, coming up with a pretty accurate and timely picture of what the top 150 leaders in the company wanted to do. I put all of this together and sent out a memo to the entire company summarizing my findings. These interviews gave me the mandate to do what I needed to do. It created a shared reality for the company and allowed people to begin aligning around a number of goals. The exercise was probably the single most important thing I did upon becoming CEO.


What’s happened since?


Even in this short time, we’ve been through three or four different stages of growth. The first involved restructuring the management team and changing the culture so we’d be able to launch new products. Next, we took action by acquiring Immunex and its popular drug, Enbrel, and by launching Aranesp and Neulasta. Then we entered a period of what you could call hypergrowth, as we ramped up the production and marketing of those three drugs, hired a lot of people, and expanded geographically. We were barely in control as we tried to keep up with the growth. We almost went off the rails last year because our accounts payable system was mainly paper based. Today, although we still expect growth on the order of 20% this year, we’re more in control. It’s a period of consolidation.


Just this morning, I was talking with a division head about how to get one part of the division to the next level. Now that we’ve got all the organizational boxes filled with people, we talked about whether the group has the right structure and the right executive skills to support a company 50% bigger than we are now. Last year, I wouldn’t have had the time to have that discussion.


Leadership isn’t easy in this kind of dizzying environment. What has your approach been?


Well, for one thing, a CEO must always be switching between what I call different altitudes—tasks of different levels of abstraction and specificity. At the highest altitude, you’re asking the big questions: What are the company’s mission and strategy? Do people understand and believe in these aims? Are decisions consistent with them? At the lowest altitude, you’re looking at on-the-ground operations: Did we make that sale? What was the yield on the last lot in that factory? How many days of inventory do we have for a particular drug? And then there’s everything in between: How many chemists do we need to hire this quarter? What should we pay for a small biotech company that has a promising new drug? Is our production capacity adequate to roll out a product in a new market?


You have to be working at all of these levels simultaneously, and that’s not easy. Jack Welch was the master of rapidly shifting between levels or even engaging with several altitudes at once. I made plenty of presentations to him as a staff guy and as a general manager. If you had weeks to get ready and Jack had none, you could stay even with him for half an hour. Then you were going to start losing.


But most CEOs tend to gravitate toward the altitude where they are most comfortable. That’s natural. Someone might choose to operate almost exclusively at the highest possible altitude: “I’m going to be responsible for the company’s strategic vision.” Another might choose to operate mainly at a lower altitude: “I’m going to pick the curtains in that hotel.” Both altitudes are important. But most CEOs who get in trouble do so because they get stuck at a particular altitude.


What’s your preferred altitude?


Well, I certainly have a tendency to get tied up in the nitty-gritty details of a problem. In the Navy’s nuclear submarine program, and particularly with Admiral Rickover, whom I served under, the expectation was that a young officer knew everything. If there was some component problem in the ship, you were expected to know, right down to the circuit level, how it worked and why it wasn’t working. You weren’t expected to take the screwdriver and fix it, but you were supposed to have comprehensive knowledge of the system.


There’s a problem, though, transferring this ingrained tendency I have to a business setting. When I go into what I call my submarine mode—when I go very, very deep into a problem—I tend to think I can solve it myself, ignoring the advice of experts and closing down debate. I’ve paid a price for this—for example, in forging ahead with a product that others were telling me didn’t have sufficient commercial promise.


There are other dangers in spending too much time at a low altitude. Regular, detailed operating reviews of major business units encourage financial discipline and accountability. But you have to be sure that you don’t schedule these meetings too frequently and end up interfering with the very people you’re trying to help. If you’re not really careful, you can create a situation where people are doing nothing but getting ready for the next briefing.


Mainly, though, I prefer to work at a middle-to-high altitude. I’m fascinated with long-term strategic alternatives. I’m not a daydreamer, but because Amgen’s financial resources give it a variety of options, I like to reflect on and talk about those options. Here, too, I sometimes have to force myself out of my comfort zone. I’ve decided that I need to look at these big-picture options two or three times a year and then put them away, unless a dramatic event changes the landscape. Otherwise, it can be destabilizing to the organization. People begin wondering, “What idea is Kevin going to have next?” I also have learned to be careful about ruminating on these things with the wrong audience. When you reflect on strategy, you’re reflecting on the possibility of change, which can be unsettling if it seems to be always on the CEO’s mind. So increasingly, I confine these discussions to a relatively small group of people.


Describe a day in which you had to make rapid shifts in altitude.


The day before yesterday, we had a morning executive committee meeting—our biweekly gathering of our top ten executives—in which we considered a range of issues. Do we make a $100 million investment that would involve dramatic changes in our European operations? This was a high-altitude kind of decision. We also did a country-by-country review of our biggest product. Which accounts are we winning and why? What does the sales force distribution look like? How did last week’s revenue data point compare to the trend line? Down-on-the-ground sort of stuff.


Later in the day, I met with a consultant who is helping us do assessments of our executives. We talked about a CEO succession candidate who might take over six to nine years from now. The consultant had interviewed 20 people about this candidate, and he synthesized those discussions for me. So that’s another pretty high-altitude activity.


And then I spent some time on, well, the shape of the boardroom table. Because our boardroom is too big, we can’t get the kind of intimacy that I want. So I had the architects put together a mock-up boardroom table in another room that was a lot smaller. I wanted to see if we could get a shirtsleeves-rolled-up, around-the-kitchen-table feel. And I’m down in this room trying to decide how the dynamics of the group might change in that setting.


So you’re always aware of the level you’re working at and ready to move to another one?


Yes, but you also have to choose which of three broad areas you will focus on at any given moment: one, context—that is, the mission, aspirations, values, and leadership behavior that define a company—two, strategy, and three, execution. Obviously, a variety of altitudes exist within each of these three areas. Moving nimbly in and out of these areas and at different altitudes in each is crucial to leadership success, particularly in times of rapid growth and uncertainty.


So, for example, you might need to spend time working on a redesign of your organizational structure—a high-level, operational task—and then quickly switch to drafting a memo to all employees aimed at reinforcing one of the company’s values—a low-level, context-setting task. Thinking of my job in this way helps me decide where to devote my energies and keeps me from getting stuck at one altitude or in one area. It also helps to ensure that the urgent doesn’t crowd out the important.


In what ways can the urgent crowd out the important?


Actually, the urgent often is the most important. But it’s easy to forget about other important items that aren’t making immediate demands on you. For instance, it’s easy to forget the importance of regularly educating the board about where the company is and where it’s heading. It’s critical that the management and the board stay in sync. And this is hard to do, because we’re living this thing every day, whereas the board shows up four to six times a year for five to six hours. It’s tempting to go to the board meeting and say, “Here are the results, here’s how we’re doing against budget, here’s…here’s…here’s…Any questions? Thanks a lot.”


But it’s crucial that the board is thinking with you, particularly when you’re growing fast. Because if you don’t have the board with you, you can’t seize opportunities as they come up. Yesterday we got fast approval for an acquisition because the board immediately understood where the company was and how this acquisition fit into our strategic and operational framework.


To take a more specific instance, in that discussion I had earlier this morning with the division head, we talked about the org chart for part of that function. It had too many cumbersome layers, in part because we’re trying to accommodate some people by letting them keep their current positions. So the “urgent” is: How do we accommodate these people who, at the moment, we can’t really afford to lose? The “important” is: How do we ultimately get the right organization in place? You might conclude that, because we have an urgent need to retain these people, we’ll have to settle for a subpar structure. At the same time, we don’t want the preferences of a few people to keep us from building a structure that will allow us to grow. In the end, we found a way—or at least I think we did—to deal with the right now and still find a path to the future.


One aspect of Amgen’s growth is its workforce. How have you integrated all of these new people into the company?


I read a George Will column once in which he mused on what it took to be an American, as compared with what it took to be a German or a Frenchman. He said he didn’t know what it took to be a German or a Frenchman. But he knew that to be an American, you really only had to believe in the Constitution, the Declaration of Independence, and the Bill of Rights, and either speak English or be learning to speak English. If you buy into that, you’re American. And I thought to myself, “Gee, at our growth rate—half our 13,000 employees are new in the last two years—we’re a company of immigrants! So what does it take to be part of Amgen?” Well, you’ve got to believe in our corporate mission—to serve patients. You’ve got to believe in and act on our corporate aspiration—to be the best human therapeutics company. And you’ve got to believe in our set of corporate values, which range from competing intensely to respecting one another. If you really believe in these, you’re part of Amgen.


In developing these principles—our mission, our aspiration, and our values—we’ve tried to reinforce a common culture that will keep the organization aligned as we grow. We settled on these principles after a lot of discussion. For example, our corporate aspiration wasn’t arrived at immediately. We could have aspired to simply be the biggest biotech company, but that wasn’t very inspiring nor, by the late 1990s, very challenging. So we settled on aspiring to be one of the top-ten companies in market capitalization in our industry. I was responsible for this aspiration—and what a dud it was! During those interviews I had with the company’s 150 most-senior executives, people basically said, “Top-ten market capitalization as an aspiration? You’ve got to be kidding. That sounds like GE or something. We’re patient focused and science based. Why aren’t we aiming as high as we can possibly aim? Why aren’t we trying to be the best human therapeutics company in the world?” And that’s what we adopted as our corporate aspiration.


“People basically said, ‘Top-ten market capitalization as an aspiration? You’ve got to be kidding. That sounds like GE or something. Why aren’t we aiming as high as we can possibly aim?’”


All the new faces at Amgen include people at the top. Why have you brought in so many senior executives from outside?


A top management team is the most revealing window into a CEO’s style, values, and aspirations. You can’t overestimate its importance, particularly when you’re growing fast—not to mention when you’re migrating from a monopoly position to a competitive one, as we have. When you go from being a $3 billion company to a $10 billion company in four years, you’d better have people with $20 billion worth of capability in them. At this rate of growth, you want to overman the challenges, instead of always trying to play catch-up, because otherwise things will implode.


Not everybody can or wants to grow in capability and contribution at the same rate as the company. So how do you deal with somebody who at the $1 billion level is terrific and who at the $5 billion level is struggling in that same job? Sometimes you reduce the scope or complexity of the job. Sometimes you just say, “It’s been a great ride, thanks a lot, we’re going to help you get to a place that’s more consistent with your abilities.” Neither of those decisions is easy to make or implement. But they’re necessary.


There’s another problem: If you don’t have the right top team, you won’t have the right tiers below them. A-players won’t work for B-players. Maybe with a company like GE, the reputation of the company is so strong that it can attract top people to work for weaker managers. In a new company like Amgen, that won’t happen.

“If you don’t have the right top team, you won’t have the right tiers below them.”

Of the ten-person executive committee, eight have been at the company for four years or less. I’ve been here for 12 years, and one fellow has been at Amgen for 21 years. His case is interesting. Dennis Fenton is the head of operations. Over the years, he’s been willing to take jobs outside of his comfort zone. With no relevant experience whatsoever, he left manufacturing and took over sales and marketing for a while when the head of that division died suddenly. When I became CEO, he ran research and then human resources later on. Unlike some of his longtime colleagues, who found it hard to imagine a challenging and discontinuous future for Amgen, he had real fire in his gut.


How did you go about recruiting people for the top management team?


We had executive recruiters, but I also kept an eye out for people who might, for one reason or another, be open to changing jobs. We knew who we wanted as head of R&D, which was a new position with responsibilities that had formerly been the CEO’s. This individual—Roger Perlmutter, an R&D executive at Merck—wouldn’t return our phone calls, so we finally settled on another candidate we thought might work. One day, I noticed in the Wall Street Journal the announcement of a management change at Merck, one that looked like it might not be all that great for Perlmutter. So I asked David Baltimore, who’s on our board of directors and a Nobel laureate, to call Roger, on the theory that scientists always return the phone calls of Nobel laureates. It worked. We got Roger to come out to the company and basically offered him a job that day. After some intense negotiation over the Christmas holidays, he joined us.


We also got our new sales and marketing head, George Morrow, by acting decisively. I had asked numerous people—consultants, financial analysts, doctors—whom they thought was the best sales and marketing manager in the industry, and his name came up time and again. I got an introduction to him through a mutual friend, and we had lunch. But he had a great job at Glaxo and was a possible candidate for the CEO job there. Then Glaxo and SmithKline announced plans to merge. My response? I showed up at his house in North Carolina on a stormy Friday night to try to sell him and his family on Amgen and California. After several months of discussion, we seemed close to a deal. And then he called to express some reservations about our proposed agreement with him.


A key hire was slipping away. A rapid altitude change was required. I canceled all my appointments and got a detailed briefing from our HR people on the complex elements of an executive financial package so that I could persuasively address his concerns. I then took out a blank piece of paper and spent four hours crafting a personal, absolutely from-the-heart letter that conveyed how much he had impressed us. I acknowledged his concerns and described as clearly as I could the opportunity he had to help us transform the company. He accepted the job.


So you get a super team in place. How do you ensure that you have the team’s support?


The key, I think, is something that’s easy to say and hard to do: I trust them. That means I give people a lot of freedom and flexibility and authority. For example, we’re considering a major scientific investment. The head of research went and talked with a key board member about concerns the board might have with the investment so that he would be ready to answer questions about it at the next meeting. I didn’t have to tell him to do that. And he didn’t have to ask me if it was OK to go talk to a board member. This kind of independence is possible because the team is so capable and because we have very tight alignment around our goals.


Trust also means that the executive committee manages as a council. We really work together as a leadership team rather than as a rubber stamp operation for me. My model as CEO is the prime ministerial one, where if you don’t have the support of independent, strong, and knowledgeable cabinet members, you don’t have a job. This is quite different from the presidential model, where you have a bunch of people in the cabinet whom you may not know that well and whom you choose to fire every now and then.


This view of the CEO role is reflected in how I am evaluated. Each year, the nine people who report to me deliver to the board a collective review of my performance. I’m not in the room when this report is presented. Then the directors call me in and talk to me. It isn’t always the most comfortable exercise, but it’s healthy for everybody. I want to be a role model for my team by acknowledging that, like everyone, I can benefit from coaching. In fact, one of the best ways to grow as a CEO is to listen to your executive team, which has a near-perfect understanding of your leadership balance sheet.


Growth usually is accompanied by some awkward stumbles. What sort of mistakes have you made as Amgen has grown?


We’ve had our share of failures. One was the launch of a product called Kineret. It’s a product that is very helpful to some patients with rheumatoid arthritis, and it was clearly a scientific breakthrough. But as company president in the late 1990s—and this is an example of my going into “submarine mode”—I failed to listen to the marketplace and people who were objective. I essentially said, “Look, I am going to decide the revenue potential of this product, and that’s it.” Then we spent money based on that estimated revenue potential, causing us to lose millions of dollars—because the potential was nothing like what I was asserting.


The seeds of this mistake are instructive. For one thing, my decision represented a bet by me that some clinical data not yet available would show this drug to be more efficacious than it really was. What drove me to make this seriously bad decision? Amgen had not had a new product in almost ten years, and we were desperate to show that we could innovate and move into the treatment of diseases that were beyond those of our two successful products. When a company that is growing rapidly becomes concerned that it doesn’t have the products needed to sustain that growth, it can get desperate. And the likelihood is that you’re going to make some marginal investment decisions in the pursuit of growth.


Another failure was the development of a product called Leptin, which in the mid-1990s got a lot of attention because people saw it as a cure for obesity. Everybody heard about this fat mouse that got real skinny. Columnist Dave Barry said that if the drug worked, “I’d inject my eyeballs with it.” There was scientific evidence that this thing was a real breakthrough, and I told the product development guys to invest as much they needed to explore the drug’s potential. And even when the initial results weren’t very positive, we just kept investing. Now you could say that this was an aggressive pursuit of science, which in part it was. You could also say that we needed to learn how to say stop.


With Kineret and Leptin alone, I was responsible for investing millions of dollars of shareholder money unwisely. Hopefully, there’s some stuff I’ve done on the other side of the ledger that balances it out. And those projects haven’t been a complete loss. We teach cases about these failures in our new executive leadership development course, a four-day program for the top 400 managers in the company.


You can’t let past mistakes, and the fear of making more, paralyze you. In fact, I like to say that sometimes you have to be willing to bet your job if you’re going to move an enterprise forward.


How often have you placed that bet?


At least three times. The first was when I fired most of the management team and hired this entirely new group of people I didn’t know. Maybe these people weren’t as good as I’d thought. Maybe they didn’t have the passion to make Amgen as good as it could possibly be. Maybe they wouldn’t be able to work together. Maybe they wouldn’t hire good people to work for them. Any of those possibilities could have derailed us. But I hired from the outside not because I thought it was a great idea but because I thought it was a necessity, given how much our business was changing. I felt that the company would fail if I didn’t get the right leadership. My hope was that the people I brought in would be so unquestionably superb that current employees wouldn’t have any doubts about why the hires were made. I think that turned out to be the case.


The second time I bet my job was when we decided in 2001 to buy Immunex, just as we were in the process of launching our first two major products in many years: Aranesp and Neulasta. And not just launching them, but launching them into a competitive market and with a brand new team. Furthermore, the acquisition posed more than just the usual challenges of integration. There was also the challenge of quickly ramping up production of Immunex’s popular drug Enbrel, which was becoming somewhat tarnished in the marketplace because the company hadn’t been able to make the product fast enough to meet demand. The acquisition has so far proved to be a success.


My third bet was the decision to go head-to-head against J&J, which until then had been a collaborator of sorts because of our licensing Epogen to the company. Just before I became CEO, we were considering an alliance with J&J to jointly market Aranesp, our new anemia drug. I thought that might make good strategic sense and had discussions over the course of a year with Bill Weldon, then head of J&J’s pharmaceutical business and now CEO. Granted, there were difficulties in figuring out how to share the revenue. And it would be hard to overcome the litigious, Hatfield-and-McCoy history between the two companies. But this was a real option, especially given Amgen’s lack of experience operating in competitive markets.


Then, at a meeting in Paris of the company’s operating executives, I informally polled people during a cocktail reception. Everyone was dead set against a deal with J&J. They didn’t want to rest in the company’s shadow. “Okay,” I said, “that’s it. We’re going to compete against these guys”—the biggest, toughest player in the game, against its biggest product. If it hadn’t worked out, I wouldn’t be sitting here.


What in you has prompted this risk taking?


Jack Welch was centrally important to me as a CEO role model. As a young assistant to him, I observed him often and up close—and at a time when he was making his boldest moves to change GE. He was struggling, but he continued to move ahead. I remember a top management meeting where he said with utter conviction that GE was to become the most competitive enterprise and the company with the highest market capitalization on earth. This was during IBM’s zenith, and I remember sitting in the audience and thinking, “Gosh, this is a fanciful goal.” But his conviction made the hair stand up on the back of my neck.


Anyway, once I was making a presentation to some senior GE executives about acquiring RCA, after leading the team that did the analysis. Jack went around the table and asked everybody what they thought. Larry Bossidy, who was vice chairman at the time, said, “Boy, Jack, we’re going to have to send a lot of people home in Indiana.” I remember that because RCA had a big TV factory in Indiana. And as Jack continued around the table, I just kind of blurted out, “I’ve analyzed 300 companies, this is the best company, we need to do this acquisition, and we have to move on it.” My boss, the VP of corporate development, who I hadn’t cleared any of this with, went, “Uhhh, what are you saying here?”


Well, after we acquired RCA, Jack called me up into his office and said, “Hey, Kevin, I want to tell you something. Remember that meeting? There were two guys in the room who thought what you said was right—me and you. You took the shot, you said what you thought, and guess what? You were right. Good job, kid.” I’ll never forget that. His vision and aspiration for GE emboldened me in that meeting, and it continues to inspire me today.


It’s one thing to talk about bold moves when a company is growing like gangbusters. How do you lead as a company gets bigger and growth inevitably slows?


I think honesty plays a key role. You have to articulate a credible and achievable strategy for the company. We think we can maintain very strong growth over the next three to four years with our current products. Beyond that, who knows? You simply can’t see that far ahead. Until the FDA approves a product, it’s all speculation.


So I try to be optimistic but realistic. My aim is to underpromise and overdeliver. That’s the best approach in dealing with analysts and investors. And it’s the best approach, I think, with employees. Besides, our employees have something else to motivate them besides spectacular financial results—our mission of helping patients and our aspiration of being the best human therapeutics company in the world.