Biogen(US:BIIB)2025-05-01 10:52Performance Overview Biogen's Q1 2025 saw total revenue rise 6% to $2.4 billion, though diluted EPS declined due to a $165 million payment, with new products now comprising 45% of total product revenue Q1 2025 Financial Highlights | | Q1 '25 | Q1 '24 | △ | |---|---|---|---| | Total Revenue (in millions) | $2,431 | $2,290 | 6% | | GAAP diluted EPS | $1.64 | $2.70 | (39)% | | Non-GAAP diluted EPS | $3.02 | $3.67 | (18)% | - The decline in EPS includes a significant impact of approximately ($0.95) per share from a $165 million upfront payment to Stoke Therapeutics for the zorevunersen collaboration57 - The company's commercial portfolio is transforming, with revenue from products outside the Multiple Sclerosis (MS) business now constituting approximately 45% of total product revenue4 - Biogen highlights its significant U.S. manufacturing presence, noting that roughly 75% of its 2024 U.S. product revenues were from products with manufacturing operations in the U.S4 Financial Performance Q1 2025 financial performance saw revenue growth from rare disease and contract manufacturing, offsetting declines in MS and biosimilars, while increased acquired IPR&D expenses were managed by cost-saving initiatives, maintaining a solid cash position Revenue Analysis Total revenue increased 6% to $2.43 billion, driven by strong growth in Rare Disease and Contract Manufacturing, partially offset by declines in MS and Biosimilars, with significant growth in Alzheimer's collaboration revenue Q1 2025 Revenue by Segment (in millions) | Segment | Q1 '25 | Q1 '24 | △ | |---|---|---|---| | Multiple sclerosis (MS) product revenue | $953 | $1,076 | (11)% | | Rare disease revenue | $563 | $424 | 33% | | Biosimilars revenue | $181 | $197 | (8)% | | Alzheimer's collaboration revenue | $33 | $3 | NMF | | Contract manufacturing, royalty and other revenue | $293 | $182 | 61% | | Total revenue | $2,431 | $2,290 | 6% | Expense Analysis GAAP Cost of Sales increased to 26% of revenue, R&D expenses decreased by 3%, while Acquired IPR&D significantly rose to $201 million due to collaboration payments, and SG&A expenses remained flat Q1 2025 Expense Summary (GAAP, in millions) | Expense Category | Q1 '25 | Q1 '24 | △ | |---|---|---|---| | Cost of sales | $629 | $542 | (16)% | | R&D expense | $434 | $445 | 3% | | SG&A expense | $573 | $582 | 2% | | Acquired IPR&D, upfront and milestone expense | $201 | $8 | NMF | - The increase in Acquired IPR&D expense was driven by a $165 million upfront payment to Stoke for the zorevunersen collaboration and a $35 million milestone payment to MorphoSys AG for the felzartamab Phase 3 trial initiation14 Financial Position and Cash Flow As of March 31, 2025, Biogen reported a net debt of approximately $3.7 billion, with $2.6 billion in cash and $6.3 billion in total debt, generating $259 million in net cash flow from operations and $222 million in free cash flow Key Financial Position & Cash Flow Data (as of Q1 2025) | Metric | Value (in millions) | |---|---| | Cash and cash equivalents | $2,598 | | Total Debt | ~$6,300 | | Net Debt | ~$3,700 | | Net cash flow from operations | $259 | | Free cash flow | $222 | Business and Pipeline Highlights Biogen reported strong commercial momentum for new products like LEQEMBI and SKYCLARYS, while strengthening its pipeline with new collaborations and advancing key candidates like BIIB080 which received FDA Fast Track designation - LEQEMBI global in-market sales reached approximately $96 million, with U.S. sales contributing $52 million5 - Global SKYCLARYS revenue was approximately $124 million, showing continued demand growth5 - The pipeline was expanded with an agreement for zorevunersen (Dravet syndrome) and initiation of a Phase 3 study for felzartamab (kidney transplant rejection)5 - BIIB080, an investigational ASO therapy for Alzheimer's disease, received FDA Fast Track designation5 - The Phase 2b LUMA study for BIIB122 (Parkinson's disease), in collaboration with Denali Therapeutics, is fully enrolled with a readout expected in 202627 Full Year 2025 Financial Guidance Biogen updated its full-year 2025 Non-GAAP diluted EPS guidance to $14.50-$15.50, reflecting a negative impact from the Stoke payment partially offset by foreign exchange, while expecting a mid-single digit revenue decline and $800 million in 'Fit for Growth' savings Full Year 2025 Non-GAAP Diluted EPS Guidance Update | | Amount | |---|---| | Prior Guidance (February 2025) | $15.25 to $16.25 | | Approx. impact from Stoke upfront payment | ($0.95) | | Benefit mainly from foreign exchange | +$0.20 | | Updated Guidance | $14.50 to $15.50 | - Full year 2025 total revenue is expected to decline by a mid-single digit percentage at constant currency versus 2024516 - The 'Fit for Growth' program is expected to generate approximately $800 million in net savings by the end of 2025, with combined Non-GAAP R&D and SG&A expenses projected to be ~$3.9 billion16 Financial Statements (Tables) This section provides detailed unaudited financial statements for Q1 2025, including the Condensed Consolidated Statement of Income, Balance Sheets, Product Revenue breakdown, and GAAP to Non-GAAP reconciliations for key metrics Table 1: Condensed Consolidated Statement of Income This table presents the company's Q1 2025 revenues, costs, and expenses, resulting in a net income of $240.5 million and diluted EPS of $1.64, compared to $393.4 million and $2.70 respectively in Q1 2024 Q1 2025 vs Q1 2024 Statement of Income Highlights (in millions) | | For the Three Months Ended March 31, | |---|---|---| | | 2025 | 2024 | | Total revenue | $2,431.0 | $2,290.5 | | Total cost and expense | $2,119.8 | $1,825.7 | | Income before income tax | $311.2 | $464.8 | | Net income attributable to Biogen Inc. | $240.5 | $393.4 | | Diluted earnings per share | $1.64 | $2.70 | Table 2: Condensed Consolidated Balance Sheets This table illustrates the company's financial position as of March 31, 2025, showing total assets of $28.03 billion, with cash and cash equivalents at $2.60 billion and total liabilities at $11.05 billion Balance Sheet Highlights (in millions) | | As of March 31, 2025 | As of December 31, 2024 | |---|---|---| | Cash and cash equivalents | $2,598.3 | $2,375.0 | | Total current assets | $7,626.0 | $7,456.8 | | TOTAL ASSETS | $28,033.1 | $28,049.3 | | Total current liabilities | $5,297.4 | $5,528.8 | | TOTAL LIABILITIES AND EQUITY | $28,033.1 | $28,049.3 | Table 3: Product Revenue Details This table provides a detailed breakdown of product revenues by drug and region, highlighting declining TYSABRI sales, growing SPINRAZA sales, and strong uptake of new products like SKYCLARYS and ZURZUVAE Q1 2025 Key Product Revenue (in millions) | Product | Q1 2025 Total Revenue | Q1 2024 Total Revenue | |---|---|---| | TYSABRI | $381.5 | $431.3 | | SPINRAZA | $423.9 | $341.3 | | SKYCLARYS | $123.9 | $78.0 | | ZURZUVAE | $27.7 | $12.4 | Table 4: GAAP to Non-GAAP Reconciliation This table details adjustments reconciling GAAP to Non-GAAP measures for Q1 2025, including $101.3 million for amortization and $49.4 million for inventory fair value step-up, bridging GAAP diluted EPS of $1.64 to Non-GAAP diluted EPS of $3.02 Q1 2025 GAAP to Non-GAAP EPS Reconciliation | | Per Share Amount | |---|---| | Total diluted earnings per share, GAAP | $1.64 | | Adjustments to GAAP net income | $1.38 | | Total diluted earnings per share, Non-GAAP | $3.02 | Q1 2025 Free Cash Flow Reconciliation (in millions) | | Amount | |---|---| | Net cash provided by operating activities | $259.3 | | Less: Purchases of property, plant and equipment | $37.1 | | Free cash flow | $222.2 |