10-QPeriod: Q1 FY2016

BIOGEN INC. Quarterly Report for Q1 Ended Mar 31, 2016

Filed April 21, 2016For Securities:BIIB

Summary

Biogen Inc.'s first-quarter 2016 results demonstrate robust top-line growth and improved profitability. Total revenues increased by 6.7% year-over-year to $2.73 billion, primarily driven by a 6.3% rise in product revenues, with strong performance from TECFIDERA, ELOCTATE, and ALPROLIX. This growth was partially offset by declining interferon revenues, as anticipated due to patient transitions to newer therapies. The company also saw significant growth in other revenues, up 69% due to increased other corporate revenue. Operating expenses decreased by 6.2%, showcasing effective cost management through reduced SG&A and R&D spending, despite a modest restructuring charge. Diluted earnings per share (EPS) surged by 26.9% to $4.43, reflecting the strong revenue growth and efficient cost control. The company generated substantial operating cash flow of $963.4 million, indicating healthy underlying business operations. Biogen's financial position remains solid, with total cash, cash equivalents, and marketable securities at $6.78 billion as of March 31, 2016. Key developments include positive regulatory recommendations for ALPROLIX in Europe and the EU approval for BENEPALI, signaling progress in the hemophilia and biosimilar portfolios, respectively.

Financial Highlights

52 data points
Beta

Revenue

$2.73B

88.5% Gross Margin

Net Income

$970.90M

35.6% Net Margin

EPS (Diluted)

$4.43

Total Assets

$20.67B

Cash & Equivalents

$1.13B

Free Cash Flow

$888.90M

Financial Statements
Beta
Revenue$2.73B
Cost of Revenue$313.00M
Gross Profit$2.41B
SG&A Expenses$497.30M
Operating Expenses$1.35B
Operating Income$1.38B
Interest Expense$63.30M
Net Income$970.90M
EPS (Basic)$4.44
EPS (Diluted)$4.43
Shares Outstanding (Basic)218.90M
Shares Outstanding (Diluted)219.30M

Key Highlights

  • 1Total revenues increased 6.7% to $2.73 billion, driven by strong product sales.
  • 2Product revenues grew 6.3% to $2.31 billion, with TECFIDERA, ELOCTATE, and ALPROLIX showing significant gains.
  • 3Diluted EPS increased by 26.9% to $4.43, demonstrating improved profitability.
  • 4Operating expenses decreased by 6.2% due to lower SG&A and R&D costs, alongside a restructuring charge of $9.7 million.
  • 5Net cash provided by operating activities was $963.4 million, up significantly from the prior year.
  • 6Cash, cash equivalents, and marketable securities totaled $6.78 billion, providing substantial liquidity.
  • 7Positive regulatory developments for ALPROLIX in the EU and approval for BENEPALI in the EU were noted.

Frequently Asked Questions

The primary driver of revenue growth was the increase in product revenues, specifically from TECFIDERA, ELOCTATE, and ALPROLIX. TECFIDERA saw a 14.7% increase in worldwide revenues, and ELOCTATE and ALPROLIX also contributed significantly with strong unit sales volume increases.

Biogen effectively managed its expenses by decreasing total cost and expenses by 6.2%. This was achieved through a 11.3% reduction in selling, general and administrative (SG&A) expenses and a 5.0% decrease in research and development (R&D) costs. A $9.7 million restructuring charge was recognized, but overall cost control measures were successful.

Biogen maintained a strong liquidity position, with cash, cash equivalents, and marketable securities totaling $6.78 billion as of March 31, 2016. The company generated $963.4 million in operating cash flow during the quarter, indicating robust operational liquidity and the ability to fund ongoing operations and strategic initiatives.

Key updates included a positive recommendation from the European Medicines Agency (EMA) for ALPROLIX marketing authorization in the EU, and the EU approval of BENEPALI, an etanercept biosimilar. These developments highlight progress in the hemophilia and biosimilar product portfolios.