10-QPeriod: Q3 FY2010

BIOGEN INC. Quarterly Report for Q3 Ended Sep 30, 2010

Filed October 26, 2010For Securities:BIIB

Summary

Biogen Idec reported total revenues of $1,175.8 million for the third quarter of 2010, a 4.9% increase compared to the same period in 2009. While overall revenues grew, income from operations saw a significant decrease of 49.5% to $194.1 million. This decline was primarily driven by a substantial $205.0 million charge for in-process research and development (IPR&D) related to the Knopp Neurosciences agreement. Net income attributable to Biogen Idec decreased by 8.5% to $254.1 million. Key revenue drivers included strong performance from AVONEX, which saw an 11.0% increase in worldwide revenue, and continued growth in TYSABRI, with Biogen Idec's share of revenue rising by 6.6%. However, RITUXAN revenue decreased by 9.1%, largely due to royalty expirations in international markets. The company also announced strategic reviews under its new CEO, George A. Scangos, aimed at focusing R&D efforts and maximizing shareholder value, with potential strategic priority changes anticipated by year-end. The company repurchased approximately 9.0 million shares in the quarter, reflecting its commitment to returning capital to shareholders.

Financial Highlights

53 data points
Beta

Revenue

$1.18B

91.8% Gross Margin

Net Income

$254.10M

21.6% Net Margin

EPS (Diluted)

$1.05

Total Assets

$7.39B

Cash & Equivalents

$626.76M

Free Cash Flow

$389.28M

Financial Statements
Beta
Revenue$1.18B
Cost of Revenue$95.92M
Gross Profit$1.08B
R&D Expenses$319.05M
SG&A Expenses$244.16M
Operating Expenses$981.65M
Operating Income$194.13M
Interest Expense$9.30M
Net Income$254.10M
EPS (Basic)$1.06
EPS (Diluted)$1.05
Shares Outstanding (Basic)239.86M
Shares Outstanding (Diluted)242.31M

Key Highlights

  • 1Total revenues increased by 4.9% to $1,175.8 million in Q3 2010, compared to Q3 2009.
  • 2Income from operations significantly decreased by 49.5% to $194.1 million, largely due to a $205.0 million IPR&D charge.
  • 3Net income attributable to Biogen Idec decreased by 8.5% to $254.1 million.
  • 4AVONEX revenues grew by 11.0% to $643.6 million, driven by both US and international markets.
  • 5TYSABRI revenue (Biogen Idec's share) increased by 6.6% to $220.7 million, reflecting continued patient uptake.
  • 6RITUXAN revenue (Biogen Idec's share) decreased by 9.1% to $258.0 million, primarily due to international royalty expirations.
  • 7The company repurchased approximately 9.0 million shares during the quarter, returning capital to shareholders.

Frequently Asked Questions

The substantial decrease in income from operations was primarily due to a $205.0 million charge for in-process research and development (IPR&D) related to the company's collaboration and license agreement with Knopp Neurosciences, Inc.

AVONEX and TYSABRI are the key revenue drivers. AVONEX saw an 11.0% increase in worldwide revenue, while Biogen Idec's share of TYSABRI revenue grew by 6.6%.

RITUXAN revenue experienced a 9.1% decrease, primarily attributed to royalty expirations in international markets, which have led to declining revenue from those regions.

Yes, under the new CEO George A. Scangos, Biogen Idec is evaluating its strategic priorities to focus R&D efforts on high-potential projects and improve decision-making speed. Changes to strategic priorities and operational initiatives are anticipated before the end of the year.