10-KPeriod: FY2011

BIOGEN INC. Annual Report, Year Ended Dec 31, 2011

Filed February 3, 2012For Securities:BIIB

Summary

Biogen Idec reported total revenues of $5.05 billion for the year ended December 31, 2011, representing a 7.0% increase compared to the previous year. This growth was primarily driven by strong performance in AVONEX and TYSABRI, which saw revenue increases of 6.7% and 19.9% respectively. TYSABRI's strong growth, in particular, highlights its increasing importance to the company's financial health, despite ongoing concerns regarding its safety profile and the associated risk management programs. The company also saw a 22.8% increase in net income attributable to Biogen Idec Inc., reaching $1.23 billion, or $5.04 per diluted share. Looking ahead, Biogen Idec's long-term success hinges on the continued sales of its key products and the successful development and commercialization of its pipeline candidates, notably BG-12 for multiple sclerosis. The company's investment in research and development remains substantial, underscoring its commitment to innovation. However, investors should remain mindful of the competitive landscape, potential regulatory hurdles, and the company's dependence on a few core products, as highlighted in the risk factors.

Financial Highlights

57 data points
Beta

Revenue

$5.05B

90.8% Gross Margin

Net Income

$1.23B

24.5% Net Margin

EPS (Diluted)

$5.04

Total Assets

$9.05B

Cash & Equivalents

$514.54M

Free Cash Flow

$1.52B

Financial Statements
Beta
Revenue$5.05B
Cost of Revenue$466.78M
Gross Profit$4.58B
R&D Expenses$1.22B
SG&A Expenses$1.06B
Operating Expenses$3.32B
Operating Income$1.72B
Interest Expense$33.00M
Net Income$1.23B
EPS (Basic)$5.09
EPS (Diluted)$5.04
Shares Outstanding (Basic)242.40M
Shares Outstanding (Diluted)245.03M

Key Highlights

  • 1Total revenues reached $5.05 billion in 2011, up 7.0% year-over-year.
  • 2AVONEX revenues increased by 6.7% to $2.69 billion, driven by price increases in the U.S. and demand growth outside the U.S.
  • 3TYSABRI revenues surged by 19.9% to $1.08 billion, reflecting increased commercial demand and pricing.
  • 4Net income attributable to Biogen Idec Inc. grew by 22.8% to $1.23 billion, or $5.04 per diluted share.
  • 5The company is preparing regulatory submissions for BG-12, an oral treatment for relapsing multiple sclerosis, following positive Phase 3 trial results.
  • 6Research and development expenses were $1.22 billion, a slight decrease from the prior year, reflecting a strategic realignment of resources.
  • 7The company's cash, cash equivalents, and marketable securities totaled $3.11 billion as of December 31, 2011, providing significant financial flexibility.

Frequently Asked Questions

Biogen Idec's primary revenue drivers in 2011 were its multiple sclerosis (MS) therapies, AVONEX and TYSABRI, which generated $2.69 billion and $1.08 billion in revenues, respectively. The company also generated significant revenue from RITUXAN through its joint business with Genentech, contributing $996.6 million.

Biogen Idec is substantially dependent on revenues from its three principal products: AVONEX, TYSABRI, and RITUXAN. Any negative developments related to these products, such as safety issues, increased competition (including biosimilars), or adverse regulatory actions, could significantly impact revenues. Furthermore, TYSABRI's sales growth is critical, but is subject to significant safety warnings, including the risk of progressive multifocal leukoencephalopathy (PML), which could limit its market potential.

A significant development is the positive top-line results from the Phase 3 trials for BG-12, an oral compound for relapsing multiple sclerosis. The company is preparing regulatory submissions for BG-12. Other key late-stage pipeline candidates include Daclizumab for MS, Factor VIII and IX for hemophilia, and dexpramipexole for ALS.

Biogen Idec conducts business globally and is therefore subject to foreign currency exchange rate fluctuations. The company uses foreign currency forward contracts to manage this risk, primarily by hedging forecasted international revenues denominated in foreign currencies. These hedging activities are intended to mitigate, over time, the impact of currency volatility on net income and earnings per share.