10-KPeriod: FY2015

BIOGEN INC. Annual Report, Year Ended Dec 31, 2015

Filed February 3, 2016For Securities:BIIB

Summary

Biogen Inc.'s 2015 10-K filing highlights a year of significant revenue growth, driven primarily by the strong performance of TECFIDERA, its multiple sclerosis (MS) treatment. Total revenues increased by 10.9% to $10.76 billion, with product revenues reaching $9.19 billion. The company also saw contributions from newer hemophilia treatments, ELOCTATE and ALPROLIX, and continued to benefit from its collaboration with Genentech on RITUXAN and GAZYVA. In 2015, Biogen underwent a corporate restructuring, including workforce reductions and program discontinuations, aimed at reinvesting savings into key commercial activities and pipeline advancement. The company also actively managed its capital allocation, returning approximately $5.0 billion to shareholders through its share repurchase program and investing in strategic acquisitions and manufacturing capabilities, including land in Switzerland for a new biologics facility. The company also filed applications for ZINBRYTA (daclizumab high yield process) in the EU and US for MS, and initiated Phase 3 studies for aducanumab, a potential Alzheimer's disease treatment.

Financial Statements
Beta
Revenue$10.76B
Cost of Revenue$1.24B
Gross Profit$9.52B
SG&A Expenses$2.11B
Operating Expenses$5.87B
Operating Income$4.89B
Interest Expense$95.50M
Net Income$3.55B
EPS (Basic)$15.38
EPS (Diluted)$15.34
Shares Outstanding (Basic)230.70M
Shares Outstanding (Diluted)231.20M

Key Highlights

  • 1Total revenues grew by 10.9% to $10.76 billion in 2015, with product revenues up 12.0% to $9.19 billion, largely driven by TECFIDERA's 25.1% revenue increase.
  • 2Biogen repurchased approximately $5.0 billion of its common stock in 2015.
  • 3The company announced a corporate restructuring in October 2015, including an 11% workforce reduction and discontinuation of certain programs, aiming to reinvest savings into key commercial activities and pipeline advancement.
  • 4Key regulatory milestones were achieved for ZINBRYTA (daclizumab high yield process) with marketing authorization applications validated by the EMA and accepted by the FDA for relapsing forms of MS.
  • 5Biogen initiated two global Phase 3 studies for aducanumab (BIIB037) for early Alzheimer's disease, with FDA agreement on the study protocols.
  • 6The company invested in expanding manufacturing capabilities, acquiring land in Switzerland for a new biologics facility and purchasing a drug product manufacturing facility in North Carolina.
  • 7Biogen's joint venture, Samsung Bioepis, received a positive opinion from the EMA for BENEPALI (etanercept biosimilar) and had its Marketing Authorization Application validated by the EMA for FLIXABI (infliximab biosimilar).

Frequently Asked Questions

Biogen's main revenue driver in 2015 was TECFIDERA, which saw a 25.1% increase in revenue. Other significant contributors included AVONEX, TYSABRI, and revenues from unconsolidated joint businesses like RITUXAN and GAZYVA. The newer hemophilia treatments, ELOCTATE and ALPROLIX, also began contributing to revenue.

In 2015, Biogen undertook several strategic initiatives including a corporate restructuring to optimize expenses, a significant share repurchase program returning $5.0 billion to shareholders, strategic acquisitions like Convergence Pharmaceuticals, investments in manufacturing capacity, and advancing its late-stage pipeline, notably with the initiation of Phase 3 trials for aducanumab in Alzheimer's disease.

Key risks highlighted include substantial dependence on revenues from principal products like TECFIDERA, intense competition from other biopharmaceutical companies and the potential introduction of generics and biosimilars, pricing and reimbursement pressures worldwide, and the inherent risks and uncertainties associated with drug development, including clinical trial failures and regulatory hurdles. Manufacturing disruptions and reliance on third-party collaborators also pose risks.

Biogen initiated two global Phase 3 studies, ENGAGE and EMERGE, for its Alzheimer's disease candidate, aducanumab (BIIB037), in September 2015. The FDA had previously agreed to Special Protocol Assessments for these study protocols, indicating concurrence on their design and size, which are intended to form the basis for regulatory approval.