10-QPeriod: Q1 FY2009

BIOGEN INC. Quarterly Report for Q1 Ended Mar 31, 2009

Filed April 17, 2009For Securities:BIIB

Summary

Biogen Idec Inc. reported strong first-quarter 2009 results, with total revenue reaching $1,036.5 million, a 10.0% increase year-over-year. Net income attributable to the company was $244.0 million, translating to diluted earnings per share of $0.84, a significant 55.6% increase compared to the prior year. This performance was primarily driven by the robust growth of TYSABRI and continued increases in AVONEX and RITUXAN revenues, partially offset by rising costs. The company highlighted the significant contribution of TYSABRI, which saw a 44.0% increase in revenue to $165.2 million, driven by a growing patient base. AVONEX revenue also saw a 3.6% increase to $555.3 million, though this was due to price increases rather than demand. RITUXAN revenue from the joint business arrangement increased by 12.8% to $278.8 million. Despite a 5.1% rise in total costs and expenses, including increased R&D spending, the company achieved substantial earnings growth, aided by a notable 21.7% decrease in income tax expense.

Financial Highlights

28 data points
Beta

Revenue

$1.04B

90.5% Gross Margin

Net Income

$244.00M

23.5% Net Margin

EPS (Diluted)

$0.84

Cash & Equivalents

$764.10M

Free Cash Flow

$263.71M

Financial Statements
Beta
Revenue$1.04B
Cost of Revenue$98.20M
Gross Profit$938.30M
R&D Expenses$279.48M
SG&A Expenses$221.83M
Operating Expenses$731.53M
Operating Income$304.96M
Net Income$244.00M
EPS (Basic)$0.85
EPS (Diluted)$0.84
Shares Outstanding (Basic)287.70M
Shares Outstanding (Diluted)289.74M

Key Highlights

  • 1Total revenue for Q1 2009 was $1,036.5 million, up 10.0% from Q1 2008.
  • 2Diluted EPS increased significantly by 55.6% to $0.84, driven by revenue growth and a lower tax expense.
  • 3TYSABRI revenue surged by 44.0% to $165.2 million, indicating strong market adoption and patient growth.
  • 4AVONEX revenue increased by 3.6% to $555.3 million, primarily due to price increases.
  • 5RITUXAN revenue from the joint business arrangement grew 12.8% to $278.8 million, supported by increased unit sales.
  • 6Research and development expenses increased by 8.2% to $279.5 million, reflecting continued investment in late-stage programs.
  • 7Effective tax rate decreased significantly to 21.0% in Q1 2009 from 33.4% in Q1 2008, largely due to favorable tax law changes.

Frequently Asked Questions

The primary drivers were the strong performance of TYSABRI, which saw a 44.0% revenue increase, and continued growth in AVONEX and RITUXAN revenues. These increases were partially offset by a 5.1% rise in total costs and expenses.

TYSABRI revenue is growing significantly due to an increase in patients using the drug. However, the company continues to monitor six reported cases of progressive multifocal leukoencephalopathy (PML), a known side effect, which they believe has negatively impacted TYSABRI's growth. Despite this, TYSABRI is a key growth driver for the company.

Biogen Idec's share of co-promotion profits from RITUXAN in the U.S. increased to $179.5 million. Total revenue from the unconsolidated joint business arrangement for RITUXAN was $278.8 million, an increase of 12.8% year-over-year. This growth is attributed to increased unit sales for B-cell NHL and chronic lymphocytic leukemia treatments, as well as rheumatoid arthritis, and price increases.

Research and development expenses increased by 8.2% in Q1 2009 primarily due to the advancement of several late-stage programs and the LINGO program. The company expects R&D expenses to continue increasing in 2009 due to greater investment in its registration-stage clinical pipeline.