On February 12, 2025 Biogen Inc. (NASDAQ: BIIB) reported fourth quarter and full year 2024 financial results (Press release, Biogen, FEB 12, 2025, View Source [SID1234650209]). Commenting on the results, President and Chief Executive Officer Christopher A. Viehbacher said:
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"We believe 2024 was an important year on our journey to deliver long-term sustainable growth. We delivered continued revenue growth from our ongoing product launches including LEQEMBI, where we believe there remains a significant long-term opportunity. We also achieved key development milestones across our late-stage pipeline, where we continue to prioritize high-conviction assets with the potential to drive growth well into the next decade. Our financial discipline has enabled a restructuring of our operating expenses with a reallocation of resources toward potential future growth drivers. We believe that continued execution against these key strategic elements, as well as a disciplined approach to business development, will allow us to generate long-term value for our shareholders by bringing innovative medicines to patients."
Financial Highlights
Q4 ’24 Q4 ’23 △
r (CC*)
FY ’24 FY ’23 △
r (CC*)
Total Revenue (in millions) $2,455 $2,386 3% 2% $9,676 $9,836 (2)% (2)%
GAAP diluted EPS $1.83 $1.71 7% N/A $11.18 $7.97 40% N/A
Non-GAAP diluted EPS $3.44 $2.95 17% N/A $16.47 $14.72 12% N/A
Note: Percent changes represented as favorable/(unfavorable) versus the prior year period.
N/A = not applicable.
* Percentage changes in revenue growth at constant currency (CC) are presented excluding the impact of changes in foreign currency exchange rates and hedging gains or losses. Foreign currency revenue values are converted into U.S. dollars using the exchange rates from the end of the previous calendar year.
A reconciliation of GAAP to Non-GAAP financial measures can be found in Table 4 at the end of this news release.
Revenue Summary
(In millions, except percentages) Q4 ’24 Q4 ’23 △
r (CC#)
FY ’24 FY ’23 △ △ (CC#)
Multiple Sclerosis (MS) product revenue(1)
$1,070 $1,168 (8)% (9)% $4,350 $4,662 (7)% (7)%
Rare disease revenue(2)
$535 $472 13% 15% $1,988 $1,803 10% 11%
Biosimilars revenue $202 $188 7% 4% $793 $770 3% 2%
Other product revenue(3)
$26 $4 NMF NMF $83 $12 NMF NMF
Total product revenue $1,833 $1,832 —% —% $7,214 $7,247 —% —%
Revenue from anti-CD20 therapeutic programs $465 $436 7% 7% $1,750 $1,690 4% 4%
Alzheimer’s collaboration revenue(4)
$27 $2 NMF NMF $60 $— NMF NMF
Contract manufacturing, royalty and other revenue $130 $117 12% 9% $653 $899 (27)% (28)%
Total revenue $2,455 $2,386 3% 2% $9,676 $9,836 (2)% (2)%
Note: Percent changes represented as favorable/(unfavorable) versus the prior year period. Numbers may not foot or recalculate due to rounding.
NMF = no meaningful figure.
(1) MS includes TECFIDERA, VUMERITY, AVONEX, PLEGRIDY, TYSABRI and FAMPYRA.
(2) Rare disease includes SPINRAZA, SKYCLARYS and QALSODY.
(3) Other includes ZURZUVAE, ADUHELM and FUMADERM.
(4) Includes Biogen’s 50% share of net revenue and cost of sales, including royalties, from the LEQEMBI Collaboration.
•Fourth quarter and full year 2024 ZURZUVAE revenue was approximately $23 million and approximately $72 million, respectively.
Expense Summary
(In millions, except percentages) Q4 ’24 Q4 ’23 △ FY ’24 FY ’23 △
GAAP cost of sales*
$583 $618 6% $2,310 $2,533 9%
% of Total Revenue 24% 26% 24% 26%
Non-GAAP cost of sales*
$540 $587 8% $2,137 $2,502 15%
% of Total Revenue 22% 25% 22% 25%
GAAP R&D expense $532 $571 7% $2,042 $2,462 17%
Non-GAAP R&D expense $528 $568 7% $1,930 $2,262 15%
GAAP SG&A expense $680 $609 (12)% $2,404 $2,550 6%
Non-GAAP SG&A expense $673 $588 (14)% $2,340 $2,277 (3)%
Note: Percent changes represented as favorable/(unfavorable) versus the prior year period
*Excluding amortization and impairment of acquired intangible assets
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•The decrease in fourth quarter 2024 GAAP and Non-GAAP cost of sales as a percentage of total revenue was driven primarily by lower idle capacity charges.
•The decrease in full year 2024 GAAP and Non-GAAP cost of sales as a percentage of total revenue was driven primarily by product mix, particularly the year-over-year increase in revenue from new product launches, a decrease in contract manufacturing revenue, and lower idle capacity charges.
•The decrease in fourth quarter and full year 2024 GAAP and Non-GAAP R&D expense was driven primarily by savings from the Company’s R&D prioritization and Fit for Growth initiatives.
•The increase in fourth quarter 2024 GAAP and Non-GAAP SG&A was driven primarily by sales and marketing spend to support product launches, partially offset by savings from the Company’s Fit for Growth initiative.
•Full year 2024 GAAP and Non-GAAP SG&A includes higher operational spending on sales and marketing activities in support of LEQEMBI and SKYCLARYS, which was partially offset by cost-reduction measures realized in connection with the Company’s Fit for Growth program.
Other Financial Highlights
•Fourth quarter 2024 GAAP and Non-GAAP collaboration profit sharing was a net expense of approximately $57 million. This includes approximately $51 million related to Biogen’s collaboration with Samsung Bioepis, and approximately $6 million related to Biogen’s collaboration with Sage Therapeutics related to the commercialization of ZURZUVAE in the U.S.
•Full year 2024 GAAP and Non-GAAP collaboration profit sharing was a net expense of approximately $254 million. This includes approximately $227 million related to Biogen’s collaboration with Samsung Bioepis, and approximately $27 million related to Biogen’s collaboration with Sage Therapeutics related to the commercialization of ZURZUVAE in the U.S.
•Fourth quarter 2024 GAAP other expense was approximately $150 million and includes approximately $78 million of net losses on strategic equity investments and approximately $42 million of net interest expense. Fourth quarter 2024 Non-GAAP other expense was approximately $72 million, primarily driven by net interest expense.
•Full year 2024 GAAP other expense was approximately $344 million and includes approximately $183 million of net interest expense and approximately $100 million of net losses on strategic equity investments. Full year 2024 Non-GAAP other expense was approximately $243 million, primarily driven by net interest expense.
•Fourth quarter 2024 GAAP and Non-GAAP effective tax rates were 8.5% and 12.2%, respectively. Fourth quarter 2023 GAAP and Non-GAAP effective tax rates were 14.7% and 17.0%, respectively.
•Full year 2024 GAAP and Non-GAAP effective tax rates were 14.4% and 14.6%, respectively. Full year 2023 GAAP and Non-GAAP effective tax rates were 10.4% and 15.2%, respectively.
Financial Position
•Fourth quarter 2024 net cash flow from operations was approximately $761 million. Capital expenditures were approximately $39 million, and free cash flow, defined as net cash flow from operations less capital expenditures, was approximately $722 million.
•Full year 2024 net cash flow from operations was approximately $2.9 billion. Capital expenditures were approximately $154 million, and free cash flow, defined as net cash flow from operations less capital expenditures, was approximately $2.7 billion.
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•As of December 31, 2024, Biogen had cash and cash equivalents totaling approximately $2.4 billion with approximately $6.3 billion in total debt, resulting in net debt of approximately $3.9 billion.
•For the fourth quarter of 2024 the Company’s weighted average diluted shares were 146 million. For full year 2024 the Company’s weighted average diluted shares were 146 million.
Full Year 2025 Financial Guidance
For the full year 2025, Biogen expects a Non-GAAP diluted EPS guidance range as follows:
Full Year 2025 Guidance
Non-GAAP diluted EPS
$15.25 to $16.25
This Non-GAAP diluted EPS guidance range, which is based upon FX rates on February 7th, 2025, includes a headwind of approximately $0.35 from foreign exchange when compared to average exchange rates in 2024.
Total revenue is expected to decline by a mid-single digit percentage for 2025 compared to 2024 as further declines in multiple sclerosis product revenue are expected to be partially offset by increases in revenue from product launches.
For 2025 as compared to 2024, Biogen expects operating margin percentage to remain relatively flat. The Fit for Growth program is expected to generate approximately $1 billion of gross savings and $800 million net of reinvestment by the end of 2025. Since the program was initiated in 2023, approximately $400 million of net savings have been achieved, and Biogen expects to realize the balance by the end of 2025. Biogen expects combined Non-GAAP R&D expense and Non-GAAP SG&A expense to total approximately $3.9 billion in 2025.
This financial guidance does not include any impact from potential acquisitions or business development transactions or pending and future litigation or any impact of potential tax or healthcare reform, as all are hard to predict.
This guidance also assumes that foreign exchange rates as of February 7, 2025, will remain in effect for the remainder of the year, net of hedging activities. Other modeling considerations will be provided on the conference call and webcast.
Biogen may incur charges, realize gains or losses, or experience other events or circumstances in 2025 that could cause any of these assumptions to change and/or actual results to vary from this financial guidance.
Biogen does not provide guidance for GAAP reported financial measures (other than revenue) or a reconciliation of forward-looking Non-GAAP financial measures to the most directly comparable GAAP reported financial measures because the Company is unable to predict with reasonable certainty the financial impact of items such as the transaction, integration, and certain other costs related to acquisitions or large business development transactions; unusual gains and losses; potential future asset impairments; gains and losses from equity security investments; and the ultimate outcome of pending or future significant litigation without unreasonable effort. These items are uncertain, depend on various factors, and could have a material impact on GAAP reported results for the guidance period. For the same reasons, the Company is unable to address the significance of the unavailable information, which could be material to future results.
Key Recent Events
•As part of ongoing pipeline prioritization efforts, Biogen has decided to discontinue further development of BIIB113 in early Alzheimer’s disease, BIIB094 in early Parkinson’s disease, BIIB101 in multiple system atrophy, and BIIB143 (cemdomespib) in diabetic peripheral neuropathic pain.
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•In February 2025, Royalty Pharma plc announced that it had entered into an agreement with Biogen to provide research and development funding of up to $250 million for litifilimab. Following potential regulatory approval, Royalty Pharma plc will be eligible for regulatory milestones and royalties of a mid-single digits percentage of the applicable net sales.
Conference Call and Webcast
The Company’s earnings conference call for the fourth quarter will be broadcast via the internet at 8:30 a.m. ET on February 12, 2025 and will be accessible through the Investors section of Biogen’s website, www.biogen.com. Supplemental information in the form of a slide presentation is also accessible at the same location on the internet and will be subsequently available on the website for at least 90 days.