On May 1, 2025 Biogen Inc. (NASDAQ: BIIB) reported first quarter 2025 financial results (Press release, Biogen, MAY 1, 2025, View Source [SID1234652426]).
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"Biogen delivered strong first-quarter results, supporting our strategy for long-term growth. We are encouraged by the transformation in our commercial product portfolio, with approximately 45% of total product revenue in the first quarter derived from important medicines outside of our MS business," said Christopher A. Viehbacher, President and Chief Executive Officer. "In an environment of potential tariffs and medical supply security concerns, Biogen operates a significant manufacturing presence in the U.S. Roughly 75% of our 2024 U.S. product revenues were generated by products which have manufacturing operations in the U.S. In addition, Biogen pays substantial taxes in the U.S. since our U.S. market revenues are almost entirely taxable in the U.S. at Federal and state tax rates."
Financial Highlights
Q1 ’25 Q1 ’24 △
r (CC*)
Total Revenue (in millions) $2,431 $2,290 6% 8%
GAAP diluted EPS $1.64 $2.70 (39)% N/A
Non-GAAP diluted EPS $3.02 $3.67 (18)% 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.
First quarter 2025 GAAP and Non-GAAP diluted EPS reflects the ~($0.95) impact from a $165 million upfront transaction payment to Stoke related to the collaboration agreement for zorevunersen in Dravet syndrome.
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) Q1 ’25 Q1 ’24 △
r (CC*)
Multiple sclerosis (MS) product revenue(1)
$953 $1,076 (11)% (10)%
Rare disease revenue(2)
$563 $424 33% 36%
Biosimilars revenue $181 $197 (8)% (5)%
Other product revenue(3)
$29 $15 93% 92%
Total product revenue $1,727 $1,712 1% 3%
Revenue from anti-CD20 therapeutic programs $378 $394 (4)% (4)%
Alzheimer’s collaboration revenue(4)
$33 $3 NMF NMF
Contract manufacturing, royalty and other revenue $293 $182 61% 63%
Total revenue $2,431 $2,290 6% 8%
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) Multiple sclerosis includes TECFIDERA, VUMERITY, AVONEX, PLEGRIDY, TYSABRI and FAMPYRA. Effective
January 1, 2025, our collaboration and license agreement for FAMPYRA global commercialization rights was terminated.
(2) Rare disease includes SPINRAZA, SKYCLARYS and QALSODY.
(3) Other includes ADUHELM, FUMADERM and ZURZUVAE – First quarter 2025 ZURZUVAE revenue was approximately $28 million.
(4) Includes Biogen’s 50% share of net revenue and cost of sales, including royalties, from the LEQEMBI Collaboration.
Expense Summary
(in millions) Q1 ’25 Q1 ’24 △
GAAP cost of sales*
$629 $542 (16)%
% of Total Revenue 26% 24%
Non-GAAP cost of sales*
$580 $500 (16)%
% of Total Revenue 24% 22%
GAAP R&D expense $434 $445 3%
Non-GAAP R&D expense $427 $439 3%
GAAP SG&A expense $573 $582 2%
Non-GAAP SG&A expense $572 $569 (1)%
GAAP acquired in-process R&D (IPR&D), upfront and milestone expense $201 $8 NMF
Non-GAAP acquired IPR&D, upfront and milestone expense $201 $8 NMF
Note: Percent changes represented as favorable/(unfavorable) versus the prior year period
NMF = no meaningful figure.
* Excluding amortization and impairment of acquired intangible assets
•The increase in first quarter 2025 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 contract manufacturing revenue, partially offset by an increase in launch product revenue.
•The decrease in first quarter 2025 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 decrease in first quarter 2025 GAAP SG&A was driven primarily by the Company’s Fit for Growth initiative, partially offset by sales and marketing spend to support product launches.
•The increase in first quarter 2025 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.
•First quarter 2025 GAAP and Non-GAAP acquired IPR&D, upfront and milestone expense was approximately $201 million and includes a $165 million upfront transaction payment to Stoke related to the collaboration agreement for zorevunersen, and a $35 million milestone to MorphoSys AG as part of the initiation of the Phase 3 trial of felzartamab in antibody-mediated rejection.
Other Financial Highlights
•First quarter 2025 GAAP and Non-GAAP collaboration profit sharing was a net expense of approximately $58 million, which includes approximately $48 million related to Biogen’s collaboration with Samsung Bioepis, and approximately $10 million related to Biogen’s collaboration with Sage Therapeutics, Inc. and the commercialization of ZURZUVAE in the U.S.
•First quarter 2025 GAAP other expense was approximately $68 million, primarily driven by net interest expense and net losses on strategic equity investments. First quarter 2025 Non-GAAP other expense was approximately $33 million, primarily driven by net interest expense.
•First quarter 2025 GAAP and Non-GAAP effective tax rates were 22.7% and 19.4%, respectively. First quarter 2024 GAAP and Non-GAAP effective tax rates were 15.4% and 15.9%, respectively.
Financial Position
•First quarter 2025 net cash flow from operations was approximately $259 million. Capital expenditures were approximately $37 million, and free cash flow, defined as net cash flow from operations less capital expenditures, was approximately $222 million.
•As of March 31, 2025, Biogen had cash and cash equivalents totaling approximately $2.6 billion and approximately $6.3 billion in total debt, resulting in net debt of approximately $3.7 billion.
•For the first quarter of 2025 the Company’s weighted average diluted shares were approximately 147 million.
3
Full Year 2025 Financial Guidance
For the full year 2025, Biogen’s expected underlying business outlook remains unchanged and Biogen is updating its expected Non-GAAP diluted EPS guidance range to reflect the $165 million upfront transaction payment to Stoke and more favorable foreign exchange as follows:
Full Year 2025 Non-GAAP Diluted EPS
Prior Guidance (February 2025) $15.25 to $16.25
Approx. impact from $165 million Stoke upfront
($0.95)
Benefit mainly from foreign exchange +$0.20
Updated Guidance $14.50 to $15.50
This updated Non-GAAP diluted EPS guidance range reflects the ~($0.95) impact from a $165 million upfront transaction payment to Stoke related to the collaboration agreement for zorevunersen in Dravet syndrome, partially offset by a $0.20 benefit mainly from foreign exchange.
For 2025 as compared to 2024, Biogen expects total revenue to decline by a mid-single digit percentage as further declines in multiple sclerosis product revenue are expected to be partially offset by increases in revenue from product launches.
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. 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 incorporates the Company’s view that Biogen’s 2025 financial outlook is not currently expected to be materially impacted by potential tariffs as previously announced by the U.S. Administration on April 2, 2025, even if the exemption for pharmaceuticals were to be removed. This is based on both a significant proportion of U.S. revenue being derived from products which have manufacturing operations in the United States, and the Company’s current global inventory positions. The U.S. and international tariff landscape remains uncertain, and this guidance does not include contemplation of any new tariffs.
This financial guidance also assumes that foreign exchange rates as of April 25, 2025, will remain in effect for the remainder of the year, net of hedging activities.
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. 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.
Other Key Recent Events
•Today Biogen announced that BIIB122, a LRRK2 inhibitor for Parkinson’s disease developed in collaboration with Denali Therapeutics, Phase 2b LUMA study has fully enrolled with a readout expected in 2026.
•Today Biogen announced that it plans to host a series of investor events to highlight the development pipeline. Biogen plans to hold the first virtual event on June 11th at 10 a.m. ET with a focus on felzartamab and rare disease. Biogen does not intend to disclose new clinical data on the call.
Conference Call and Webcast
The Company’s earnings conference call for the first quarter will be broadcast via the internet at 8:30 a.m. ET on May 1, 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.