What changed in this filing

/stocks — the workspaceLOADING

Item 7. Management’s Discussion and Analysis

2024-02-14 compared with 2023-02-15 · 580 added, 626 removed, 309 unchanged (80% of the section changed)

5 unchanged sentences

Biogen is a global biopharmaceutical company focused on discovering, developing and delivering innovative therapies for people living with serious and complex diseases worldwide.

We have a broad portfolio of medicines to treat MS, have introduced the first approved treatment for SMA and co-developed two treatments to address a defining pathology of Alzheimer’s disease.

We are focused on advancing our pipeline in neurology, neuropsychiatry, specialized immunology and rare diseases.

We have a broad portfolio of medicines to treat MS, have introduced the first approved treatment for SMA, co-developed treatments to address a defining pathology of Alzheimer’s disease and launched the first approved treatment to target a genetic cause of ALS.

Through our 2023 acquisition of Reata we market the first and only drug approved in the U.S.

for the treatment of Friedreich's Ataxia in adults and adolescents aged 16 years and older.

We are focused on advancing our pipeline in neurology, specialized immunology and rare diseases.

We support our drug discovery and development efforts through internal research and development programs and external collaborations.

1 unchanged sentence

SPINRAZA for the treatment of SMA;

ADUHELM for the treatment of Alzheimer's disease;

SKYCLARYS for the treatment of Friedreich's Ataxia;

QALSODY for the treatment of ALS;

and FUMADERM for the treatment of severe plaque psoriasis.

We also collaborate with Eisai on the commercialization of LEQEMBI for the treatment of Alzheimer's disease, which was granted accelerated approval by the FDA in January 2023.

We have certain business and financial rights with respect to RITUXAN for the treatment of non-Hodgkin's lymphoma, CLL and other conditions;

We also have collaborations with Eisai on the commercialization of LEQEMBI for the treatment of Alzheimer's disease and Sage on the commercialization of ZURZUVAE for the treatment of PPD and we have certain business and financial rights with respect to RITUXAN for the treatment of non-Hodgkin's lymphoma, CLL and other conditions;

RITUXAN HYCELA for the treatment of non-Hodgkin's lymphoma and CLL;

1 unchanged sentence

OCREVUS for the treatment of PPMS and RMS;

LUNSUMIO (mosunetuzumab), which was granted accelerated approval in the U.S.

during the fourth quarter of 2022 for the treatment of relapsed or refractory follicular lymphoma;

glofitamab, an investigational bispecific antibody for the potential treatment of non-Hodgkin's lymphoma;

LUNSUMIO for the treatment of relapsed or refractory follicular lymphoma;

COLUMVI, a bispecific antibody for the treatment of non-Hodgkin's lymphoma;

and have the option to add other potential anti-CD20 therapies, pursuant to our collaboration arrangements with Genentech, a wholly-owned member of the Roche Group.

In addition to continuing to invest in new potential innovation in MS and SMA we are advancing our mid-to-late stage programs including zuranolone for MDD and PPD, BIIB080 for Alzheimer's disease, tofersen for ALS and both litifilimab and dapirolizumab pegol for certain forms of lupus.

We also commercialize biosimilars of advanced biologics including BENEPALI, an etanercept biosimilar referencing ENBREL, IMRALDI, an adalimumab biosimilar referencing HUMIRA, and FLIXABI, an infliximab biosimilar referencing REMICADE, in certain countries in Europe, as well as BYOOVIZ, a ranibizumab biosimilar referencing LUCENTIS, in the U.S.

We continue to develop potential biosimilar products including BIIB800, a proposed tocilizumab biosimilar referencing ACTEMRA, and SB15, a proposed aflibercept biosimilar referencing EYLEA.

We commercialize a portfolio of biosimilars of advanced biologics including BENEPALI, an etanercept biosimilar referencing ENBREL, IMRALDI, an adalimumab biosimilar referencing HUMIRA, and FLIXABI, an infliximab biosimilar referencing REMICADE, in certain countries in Europe, as well as BYOOVIZ, a ranibizumab biosimilar referencing LUCENTIS, in the U.S.

and certain international markets.

We also have exclusive rights to commercialize TOFIDENCE, a tocilizumab biosimilar referencing ACTEMRA.

We continue to develop potential biosimilar product SB15, a proposed aflibercept biosimilar referencing EYLEA.

In February 2023 we announced that we are exploring strategic options for our biosimilars business.

2 unchanged sentences

To that end, we continually review our manufacturing capacity, capabilities, processes and facilities.

In order to support our future growth and drug development pipeline, we are expanding our large molecule production capacity by building a large-scale biologics manufacturing facility in Solothurn, Switzerland.

In the second quarter of 2021 a portion of the facility received a GMP multi-product license from SWISSMEDIC.

In order to support our future growth and drug development pipeline, we expanded our large molecule production capacity and built a large-scale biologics manufacturing facility in Solothurn, Switzerland.

In the second quarter of 2021 a portion of the facility (the first manufacturing suite) received a GMP multi-product license from the SWISSMEDIC and was placed into service.

The second manufacturing suite became operational in January 2024.

Solothurn has been approved for the manufacture of ADUHELM and LEQEMBI by the FDA.

We estimate the second manufacturing suite at the Solothurn facility will be operational by the end of 2023.

We believe that the Solothurn facility will support our anticipated near-term needs for the manufacturing of biologic assets.

If we are unable to fully utilize our manufacturing facilities, due to lower than forecasted demand for our products, we will incur excess capacity charges which will have a negative effect on our financial condition and results of operations.

Our revenue depends upon continued sales of our products as well as the financial rights we have in our anti-CD20 therapeutic programs, and, unless we develop, acquire rights to and/or commercialize new products and technologies, we will be substantially dependent on sales from our products and our financial rights in our anti-CD20 therapeutic programs for many years.

In the longer term, our revenue growth will depend upon the successful clinical development, regulatory approval and launch of new commercial

Table of Conten ts

products as well as additional indications for our existing products, our ability to obtain and maintain patents and other rights related to our marketed products, assets originating from our research and development efforts and/or successful execution of external business development opportunities.

We believe that the Solothurn facility will support our anticipated near to mid-term needs for the manufacturing of biologic assets, including the commercial launch of LEQEMBI.

The plant represents a significant increase in our overall manufacturing capacity and is not yet being fully utilized, resulting in our recording of excess capacity charges.

If we are unable to fully utilize our manufacturing facilities, we will incur additional excess capacity charges which would have a negative effect on our financial condition and results of operations.

In the longer term, our revenue growth will depend upon the successful clinical development, regulatory approval and launch of new commercial products as well as additional indications for our existing products, our ability to obtain

T able of Contents

and maintain patents and other rights related to our marketed products, assets originating from our research and development efforts and/or successful execution of external business development opportunities.

BUSINESS ENVIRONMENT

3 unchanged sentences

Risk Factors, included in this report.

ADUHELM (aducanumab)

In June 2021 the FDA granted accelerated approval of ADUHELM, which, until March of 2022, we had been collaborating on with Eisai, based on reduction in amyloid beta plaques observed in patients treated with ADUHELM.

As part of the accelerated approval, we are required to conduct a confirmatory trial to verify the clinical benefit of ADUHELM in patients with Alzheimer’s disease.

The FDA may withdraw approval if, among other things, the confirmatory trial fails to verify clinical benefit of ADUHELM, ADUHELM's benefit-risk is no longer positive or we fail to comply with the conditions of the accelerated approval.

In April 2022 the CMS released a final NCD for the class of anti-amyloid treatments in Alzheimer's disease, including ADUHELM.

The final NCD confirmed coverage with evidence development, in which patients with Medicare can only access treatment if they are part of an approved clinical trial.

This decision effectively resulted in denying all Medicare beneficiaries access to ADUHELM.

We expect that this decision will reduce future demand for ADUHELM to a minimal level.

During the first quarter of 2022, as a result of the final NCD, we recorded approximately $275.0 million of charges associated with the write-off of inventory and purchase commitments in excess of forecasted demand related to ADUHELM.

Additionally, for the year ended December 31, 2022, we recorded approximately $111.0 million of aggregate gross idle capacity charges related to ADUHELM.

These charges were recorded in cost of sales within our consolidated statements of income for the year ended December 31, 2022.

We have recognized approximately $197.0 million related to Eisai's 45.0% share of inventory, idle capacity charges and contractual commitments in collaboration profit (loss) sharing

within our consolidated statements of income for the year ended December 31, 2022.

Additionally, as a result of the final NCD we have substantially eliminated our commercial infrastructure supporting ADUHELM, retaining minimal resources to manage patient access programs, including a continued free drug program for patients currently on treatment in the U.S.

We expect to continue funding certain regulatory and research and development activities for ADUHELM, including the continuation of the EMBARK re-dosing study and the Phase 4 post-marketing requirement study, ENVISION.

Additional actions regarding ADUHELM may be informed by upcoming data readouts expected for this class of antibodies, as well as further engagement with the FDA and CMS.

On March 14, 2022, we amended our ADUHELM Collaboration Agreement with Eisai.

As of the amendment date, we have sole decision making and commercialization rights worldwide on ADUHELM, and beginning January 1, 2023, Eisai receives only a tiered royalty based on net sales of ADUHELM, and no longer participates in sharing ADUHELM's global profits and losses.

Eisai's share of development, commercialization and manufacturing expense was limited to $335.0 million for the period from January 1, 2022 to December 31, 2022, which was achieved as of December 31, 2022.

Once this limit was achieved, we became responsible for all ADUHELM related costs.

Rest of World

In October 2020 the EMA accepted for review the MAA for aducanumab and in December 2020 the Ministry of Health, Labor and Welfare (MHLW) accepted for review the Japanese NDA for aducanumab.

In December 2021 the CHMP of the EMA adopted a negative opinion on the MAA for aducanumab in Europe.

We sought re-examination of the opinion by the CHMP.

In April 2022 we announced our decision to withdraw our MAA for aducanumab in Europe.

Multiple TECFIDERA generic entrants are now in North America, Brazil and certain E.U.

1 unchanged sentence

The generic competition for TECFIDERA has significantly reduced our TECFIDERA revenue and we expect that TECFIDERA revenue will continue to decline in the future.

In the E.U., we are seeking to enforce a patent granted in June 2022 that relates to TECFIDERA and expires in 2028.

In addition, we are litigating to affirm that TECFIDERA is entitled to regulatory data and

Table of Conten ts

market protection until at least February 2024.

Our Company, the EMA and the EC have each appealed the May 2021 decision of the European General Court, which annulled the EMA's decision not to validate an application for approval of a TECFIDERA generic on the basis that the EMA and EC conducted the wrong assessment when determining TECFIDERA's entitlement to regulatory data and marketing protection.

Our Company, the EMA and the EC have each appealed the General Court’s decision as wrongly decided and the appeal is pending.

On October 6, 2022, the Advocate General of the CJEU issued a nonbinding advisory opinion in Biogen's favor.

This opinion recommends that the CJEU set aside the judgment of the European General Court.

We are awaiting the decision of the CJEU.

For additional information, please read Note 21, Litigation , to our consolidated financial statements included in this report and the discussion under Results of Operations - Product Revenue - Multiple Sclerosis (MS) - Fumarate below.

Business Update Regarding COVID-19 and Other Disruptions

The COVID-19 pandemic continues to present a substantial public health and economic challenge around the world.

The length of time and full extent to which the COVID-19 pandemic directly or indirectly impacts our business, results of operations and financial condition, including sales, expense, reserves and allowances, the supply chain, manufacturing, clinical trials, research and development costs and employee-related costs, depends on future developments that are highly uncertain, subject to change and are difficult to predict, including as a result of new information that may emerge concerning COVID-19 and the actions taken to contain or treat COVID-19 as well as the economic impact on local, regional, national and international customers and markets.

We are monitoring the demand for our products, including the duration and degree to which we may see delays in starting new patients on a product due to hospitals diverting the resources that are necessary to administer certain of our products to care for COVID-19 patients, including products, such as TYSABRI and SPINRAZA, that are administered in a physician's office or hospital setting.

We may also see reduced demand for immunosuppressant therapies during the COVID-19 pandemic.

While we are currently continuing the clinical trials we have underway in sites across the globe, COVID-19 precautions have impacted the timeline for some of our clinical trials and these precautions may,

directly or indirectly, have a further impact on timing in the future.

Following a favorable March 2023 decision of the CJEU affirming TECFIDERA's right to regulatory data and marketing protection and the EC determination in May 2023 that TECFIDERA is entitled to an additional year of market protection for its pediatric indication, we believe that TECFIDERA is entitled to regulatory marketing protection in the E.U.

until at least February 2, 2025, and are seeking to enforce this protection.

In December 2023, the EC revoked all centralized marketing authorizations for generic versions of TECFIDERA.

As of December 31, 2023, some of the TECFIDERA generics have not yet fully exited some E.U.

markets and we expect removal of all generics from the market will take additional time.

We are closely monitoring this situation and working to enforce our legal right to market protection.

In addition, we will continue to enforce our EP 2 653 873 patent related to TECFIDERA, which expires in 2028.

For additional information, please read Note 21, Litigation , to our consolidated financial statements included in this report.

BUSINESS UPDATE REGARDING MACROECONOMIC CONDITIONS AND OTHER DISRUPTIONS

Significant portions of our business are conducted in Europe, Asia and other international geographies.

Factors such as global health outbreaks, adverse weather events, geopolitical events, inflation, labor or raw material shortages and other supply chain disruptions could result in product shortages or other difficulties and delays or increased costs in manufacturing our products.

Additionally, global disputes and interruptions in international relationships, including tariffs, trade protection measures, import or export licensing requirements and the imposition of trade sanctions or similar restrictions by the U.S.

or other governments, affect our ability to do business.

For example, tensions between the U.S.

and China have led to a series of tariffs and sanctions being imposed by the U.S.

on imports from China mainland, as well as other business restrictions.

CURRENT ECONOMIC CONDITIONS

Economic conditions remain vulnerable as markets continue to be impacted in part by elevated inflation, rising interest rates, global supply chain constraints and recent bank failures.

During 2023 concerns arose with respect to the financial condition of certain banking institutions in the U.S., in particular those with exposure to certain types of depositors and large portfolios of investment securities.

In March 2023 two such banks were closed and taken over by the FDIC, which created significant market disruption.

While we did not have any direct exposure to these institutions, we do maintain our cash at financial institutions, often in balances that exceed the current FDIC insurance limits, and will continue to monitor our cash, cash equivalents and investments and take steps to identify any potential impact and minimize any disruptions on our business.

If other banks and financial institutions enter receivership or become insolvent in the future due to financial conditions affecting the banking system and financial markets, our ability to access our cash, cash equivalents and investments, including transferring funds, making payments or receiving funds, may be threatened and could have a material adverse effect on our business and financial condition.

GEOPOLITICAL TENSIONS

The ongoing geopolitical tensions related to Russia's invasion of Ukraine have resulted in global business disruptions and economic volatility, including sanctions and other restrictions levied on the government and businesses in Russia.

Although we do not have affiliates or employees, in either Russia or Ukraine, we do provide various therapies to patients in Russia through a distributor and are currently involved in clinical trials with sites in Ukraine and Russia.

The timing and costs of these trials may be impacted as a result of the conflict.

In addition, new government sanctions on the export of certain manufacturing materials to Russia may delay or limit our ability to get new products approved.

The impact of the conflict on our operations and financial performance remains uncertain and will depend on future developments, including the severity and duration of the conflict, its impact on regional and global economic conditions and whether the conflict spreads or has effects on countries outside Ukraine and Russia.

Revenue generated from sales in these regions represented less than 2.0% of total product revenue for the years ended December 31, 2022 and 2021.

We will continue to monitor the ongoing conflict between Russia and Ukraine and assess any potential impacts on our business, supply chain, partners or customers, as well as any factors that could have an adverse effect on our results of operations.

Factors such as the COVID-19 pandemic and other global health outbreaks, adverse weather events, geopolitical events, labor or raw material shortages and other supply chain disruptions could result in product shortages or other difficulties and delays or increased costs in manufacturing our products.

For additional information on the various risks posed by the COVID-19 pandemic and the conflict in Ukraine, please read Item 1A.

Risk Factors, included in this report.

Table of Conten ts

The ongoing geopolitical tensions related to Russia's invasion of Ukraine and the recent military conflict in the Middle East have resulted in global business disruptions and economic volatility.

For example, sanctions and other restrictions have been levied on the government and businesses in Russia.

Although we do not have affiliates or employees, in either Russia or Ukraine, we do provide various therapies to patients in Russia through a distributor.

In addition, new government sanctions on the export of certain

T able of Contents

manufacturing materials to Russia may delay or limit our ability to get new products approved.

The impact of the conflict on our operations and financial performance remains uncertain and will depend on future developments, including the severity and duration of the conflict between Russia and Ukraine, its impact on regional and global economic conditions and whether the conflict spreads or has effects on countries outside Ukraine and Russia.

We will continue to monitor the ongoing conflict between Russia and Ukraine as well as the military conflict in the Middle East and assess any potential impacts on our business, supply chain, partners or customers, as well as any factors that could have an adverse effect on our results of operations.

Revenue generated from sales in Russia and Ukraine represent less than 2.0% of total revenue for the years ended December 31, 2023, 2022 and 2021.

Revenue generated from sales in the broader Middle East region represents less than 2.0% of total revenue for the years ended December 31, 2023, 2022 and 2021.

INFLATION REDUCTION ACT OF 2022

1 unchanged sentence

The IRA introduced new tax provisions, including a 15.0% corporate alternative minimum tax and a 1.0% excise tax on stock repurchases.

The provisions of the IRA will be effective for periods after December 31, 2022.

The enactment of the IRA did not result in any material adjustments to our income tax provision or net deferred tax assets as of December 31, 2022.

We expect additional guidance and regulations to be issued in future periods and will continue to assess its potential impact on our business and results of operations as further information becomes available.

The provisions of the IRA are effective for periods after December 31, 2022.

The IRA did not result in any material adjustments to our income tax provision or other income tax balances as of December 31, 2023 and 2022.

Preliminary guidance has been issued by the IRS and we expect additional guidance and regulations to be issued in future periods.

We will continue to assess its potential impact on our business and results of operations as further information becomes available.

The IRA also contains substantial drug pricing reforms that may have a significant impact on the pharmaceutical industry in the U.S.

2 unchanged sentences

Further, to incentivize biosimilar development, the IRA provides an 8.0% Medicare Part B add-on payment for qualifying biosimilar products for a five-year period.

The overall impact that the IRA will have on our business, results of operations and financial condition, and the impact on the pharmaceutical industry as a whole is not yet known.

The IRA's drug pricing controls and Medicare redesign may have an adverse impact on our sales (particularly for our products that are more substantially reliant on Medicare reimbursement), our business and our results of operations.

However, the degree of impact from this legislation on our business depends on a number of implementation decisions.

We will continue to assess as further information becomes available.

T able of Contents

FINANCIAL HIGHLIGHTS

Diluted earnings per share attributable to Biogen Inc.

were $20.87 for 2022, representing an increase of 100.7% as compared to $10.40 in the same period in 2021.

As described below under Results of Operations , our net income and diluted earnings per share attributable to Biogen Inc.

for the year ended December 31, 2023, compared to the year ended December 31, 2022, reflects the following:

• Total revenue was $10,173.4 million for 2022, representing an $808.3 million, or 7.4%, decrease compared to $10,981.7 million in 2021.

• Product revenue, net totaled $7,987.8 million for 2022, representing an $859.1 million, or 9.7%, decrease compared to $8,846.9 million in 2021.

This decrease was primarily due to a $666.5 million, or 10.9%, decrease in MS product

revenue, a $111.6 million, or 5.9%, decrease in SPINRAZA product revenue and an $80.0 million, or 9.6%, decrease in revenue from our biosimilar business.

◦ The decrease in MS product revenue of $666.5 million, or 10.9%, from $6,096.7 million in 2021 to $5,430.2 million in 2022, was primarily due to a decrease in TECFIDERA demand as a result of multiple TECFIDERA generic entrants in North America, Brazil and certain E.U.

countries, and a decrease in Interferon demand due to competition as patients transition to higher efficacy and oral MS therapies.

◦ The decrease in SPINRAZA revenue of $111.6 million, or 5.9%, from $1,905.1 million in 2021 to $1,793.5 million in 2022, was primarily due to country mix, the unfavorable impact of foreign currency exchange and the timing of shipments, partially offset by an increase in sales volumes.

The increase in sales volumes reflects growth in certain Asian markets, partially offset by a decrease in sales volumes from increased competition in certain established markets, particularly Germany and Japan.

◦ The decrease in revenue from our biosimilar business of $80.0 million, or 9.6%, from $831.1 million in 2021 to $751.1 million in 2022, was primarily due to unfavorable pricing and the unfavorable impact of foreign currency exchange, partially offset by an increase in sales volumes.

• Revenue from anti-CD20 therapeutic programs totaled $1,700.5 million for 2022, representing a $42.0 million, or 2.5%, increase compared to $1,658.5 million in 2021.

This increase was primarily due to a $144.6 million, or 14.6%, increase in royalty revenue on sales of OCREVUS, partially offset by a $103.4 million, or 18.0%, decrease in RITUXAN revenue.

Sales of RITUXAN have been adversely affected by biosimilar competition.

• Other revenue totaled $485.1 million for 2022, representing a $8.8 million, or 1.8%, increase from $476.3 million in 2021.

• Total cost and expense was $6,581.6 million for 2022, representing a $2,654.9 million, or 28.7%, decrease compared to $9,236.5 million in 2021.

Table of Conten ts

◦ Research and development expense decreased $270.1 million, or 10.8%, from $2,501.2 million in 2021 to $2,231.1 million in 2022, primarily due to higher upfront payments in 2021.

In 2021 we recorded approximately $285.0 million of upfront payments related to our collaborations with InnoCare, Ionis, Bio-Thera, Genentech, Capsigen Inc., and Ginkgo Bioworks, as compared to $28.5 million in 2022.

In addition, $39.1 million of estimated clinical trial closeout costs and manufacturing commitments associated with BIIB111 (timrepigene emparvovec) and BIIB112 (cotoretigene toliparvovec) were recorded in 2021.

◦ Amortization and impairment of acquired intangible assets decreased $515.4 million, or 58.5%, from $881.3 million in 2021 to $365.9 million in 2022, primarily due to higher impairment charges recorded in 2021.

In 2021 we recorded $629.3 million of impairment charges, as compared to $119.6 million in 2022.

◦ The decrease in cost and expense was also due to a pre-tax gain of $503.7 million recognized in 2022 related to the sale of one of our buildings.

◦ Other (income) expense, net for 2022 reflected a pre-tax gain of $1.5 billion related to the sale of our 49.9% equity interest in Samsung Bioepis, partially offset by a pre-tax charge of $900.0 million, plus settlement fees and expenses, related to a litigation settlement agreement to resolve a qui tam litigation relating to conduct prior to 2015.

As described below under Financial Condition, Liquidity and Capital Resources :

• We generated $1,384.3 million of net cash flow from operations for 2022.

• Cash, cash equivalents and marketable securities totaled approximately $5,598.5 million as of December 31, 2022.

• We repurchased and retired approximately 3.6 million shares of our common stock at a cost of approximately $750.0 million during 2022 under our 2020 Share Repurchase Program.

TOTAL REVENUE

$337.8 million or 3.3%

DILUTED EARNINGS PER SHARE

$12.90 or 61.8%

PRODUCT REVENUE

$741.1 million or 9.3%

• MS revenue decreased $768.3 million, or 14.1%

• Rare disease revenue increased $9.5 million, or 0.5%

• Biosimilars revenue increased $18.9 million, or 2.5%

• The decrease in MS product revenue was primarily due to a decrease in TECFIDERA demand as a result of multiple TECFIDERA generic entrants in North America, Brazil and certain E.U.

countries, a decrease in Interferon demand due to competition as patients transition to higher efficacy therapies and a decrease in U.S.

TYSABRI revenue primarily driven by increased competition and pricing pressure.

• The increase in rare disease revenue was primarily due to revenue from SKYCLARYS, which we began recognizing in the fourth quarter of 2023 as a result of our acquisition of Reata in September 2023.

The increase was partially offset by a decrease in rest of world SPINRAZA revenue primarily due to the unfavorable impact of foreign currency exchange, increased competition, a decrease in pricing and the timing of shipments.

TOTAL COST AND EXPENSE

$1,957.2 million or 29.7%

• Cost of sales increased $255.1 million, or 11.2%

• R&D expense increased $230.9 million, or 10.3%

• SG&A expense increased $146.1 million, or 6.1%

• Restructuring expense increased $87.7 million, or 66.9%

• Other income decreased $423.7 million, net

• The increase in cost of sales was primarily due to unfavorable product mix from increased contract manufacturing revenue, MS product mix and higher idle capacity charges, partially offset by a decrease in excess and obsolescence inventory charges in 2023.

• The increase in research and development expense was primarily due to clinical trial close out costs incurred in 2023 of approximately $125.4 million and the recognition of $197.0 million in equity-based compensation expense related to our acquisition of Reata.

• The increase in selling, general and administrative expense was primarily due to the recognition of $196.4 million in equity-based compensation expense related to our acquisition of Reata .

• The increase in restructuring expense was primarily due to higher severance benefits associated with the 2023 cost savings initiatives as compared to 2022.

• The decrease in other income, net was primarily due to the pre-tax gain of $1.5 billion recorded in 2022 related to the sale of our equity interest in Samsung Bioepis, partially offset by a pre-tax charge of $900.0 million, plus settlement fees and expenses, related to a litigation settlement agreement

• Additionally, total cost and expense in 2022 was reduced by a pre-tax gain of approximately $503.7 million related to a sale of a building.

T able of Contents

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

• We generated $1,547.2 million of net cash flow from operations for the years ended December 31, 2023.

Net cash flow from operations includes $393.4 million of equity-based compensation expense related to our acquisition of Reata in September 2023.

• Cash, cash equivalents and marketable securities totaled approximately $1.0 billion as of December 31, 2023, compared to approximately $5.6 billion as of December 31, 2022.

The decrease was primarily due to consideration paid for our acquisition of Reata in September 2023.

• There were no share repurchases of our common stock during 2023 under our 2020 Share Repurchase Program.

Approximately $2.1 billion remained available under our 2020 Share Repurchase Program as of December 31, 2023.

RECENT DEVELOPMENTS

DEVELOPMENTS IN KEY COLLABORATIVE RELATIONSHIPS

For additional information on our collaborative and other relationships discussed below, please read Note 19, Collaborative and Other Relationships , to our consolidated financial statements included in this report.

Eisai Collaboration Agreements

LEQEMBI (lecanemab) Collaboration Agreement

In January 2023 we and Eisai announced that the FDA granted accelerated approval of LEQEMBI, an anti-amyloid antibody for the treatment of Alzheimer's disease.

Additionally, in January 2023 we and Eisai announced the completed submission of a supplemental BLA to the FDA for traditional approval of LEQEMBI.

LEQEMBI (lecanemab)

United States

In July 2023 the FDA granted traditional approval of LEQEMBI, an anti-amyloid antibody for the treatment of Alzheimer's disease, which was previously granted accelerated approval by the FDA in January 2023.

Following the FDA's traditional approval of LEQEMBI, CMS confirmed broader coverage of LEQEMBI.

Additionally, in March 2023 Eisai announced that the U.S.

Veteran's Health Administration will be providing coverage of LEQEMBI to veterans living with early stages of Alzheimer's disease.

Rest of World

Key developments related to LEQEMBI (lecanemab) in rest of world markets during 2023 consisted of the following:

• In January 2024 we and Eisai announced that the SAG will convene at the request of the CHMP to discuss the MAA of lecanemab that is currently under review by the EMA.

The meeting of the SAG is expected to take place during the first quarter of 2024 and the EC decision for the MAA of lecanemab is expected during the first half of 2024.

• In January 2024 the NMPA approved LEQEMBI in China, with an expected launch date in 2024.

• In December 2023 we and Eisai announced that LEQEMBI intravenous infusion was launched in Japan.

• In September 2023 the Japanese Ministry of Health, Labor and Welfare approved LEQEMBI in Japan.

• In January 2023 the EMA accepted for review the MAA for lecanemab.

In January 2023 Eisai completed the submission of a MAA to the PMDA in Japan for lecanemab, and was granted Priority Review by the Japanese Ministry of Health, Labor and Welfare.

In December 2022 Eisai initiated a rolling submission of a BLA to the NMPA of China for the approval of lecanemab.

In March 2022 we extended our supply agreement with Eisai related to LEQEMBI from five years to ten years for the manufacture of LEQEMBI drug substance.

ADUHELM Collaboration Agreement

On March 14, 2022, we amended our ADUHELM Collaboration Agreement with Eisai.

Once this limit was achieved, we became responsible for all ADUHELM related costs.

For additional information on our collaboration arrangements with Eisai, please read Note 19, Collaborative and Other Relationships, to our consolidated financial statements included in this report.

Table of Conten ts

Zuranolone (BIIB125)

In June 2022 we and our collaboration partner Sage announced that the Phase 3 SKYLARK study of zuranolone, for the potential treatment of MDD and PPD, met its primary and all key secondary endpoints.

In December 2022 we and Sage completed the rolling submission of a NDA to the FDA for the approval of zuranolone for the potential treatment of MDD and PPD.

This submission completes the NDA filing initiated earlier in 2022.

In February 2023 the FDA accepted the NDA and granted Priority Review for zuranolone, with a PDUFA action date of August 5, 2023.

For additional information on our collaboration arrangement with Sage, please read Note 19, Collaborative and Other Relationships , to our consolidated financial statements included in this report.

LUNSUMIO (mosunetuzumab)

In January 2022 we exercised our option with Genentech to participate in the joint development and commercialization of LUNSUMIO (mosunetuzumab), a bispecific antibody for the treatment of relapsed or refractory follicular lymphoma.

In connection with this exercise, we recorded a $30.0 million option exercise fee payable to Genentech in December 2021.

In December 2022 Genentech announced that the FDA granted accelerated approval of LUNSUMIO, which was also approved by the EC in June 2022.

In December 2022 we reached an agreement with Genentech related to the commercialization and sharing of economics for glofitamab, an investigational T-cell engaging bispecific antibody targeting CD20 and CD3 for the potential treatment of B-cell non-Hodgkin's lymphoma.

For additional information on our collaboration arrangements with Genentech, please read Note 19, Collaborative and Other Relationships , to our consolidated financial statements included in this report.

Other Collaborative Relationships

Alcyone Therapeutics

In December 2022 we entered into a license and collaboration agreement with Alcyone to jointly develop the ThecaFlex DRx™ System, an implantable medical device intended for subcutaneous delivery of ASO therapies with a goal of improving the patient treatment experience and accessibility for people suffering from neurological disorders, such as SMA and ALS.

Under the terms of this collaboration, we

and Alcyone will jointly develop the ThecaFlex DRx™ System and Alcyone will be solely responsible for its manufacture and commercialization.

In connection with this transaction, we made an upfront payment of $10.0 million to Alcyone.

• In February 2023 the BLA for lecanemab was granted Priority Review by the NMPA of China.

• In May 2023 we and Eisai announced the submission of a MAA for lecanemab to the U.K.

MHRA in Great Britain, which has been designated by the MHRA for the Innovative Licensing and Access Pathway.

Additionally, in May 2023 Health Canada accepted for review the NDS for lecanemab.

• In June 2023 we and Eisai announced the submission of a MAA for lecanemab to the Ministry of Food and Drug Safety in South Korea.

ZURZUVAE (zuranolone)

In August 2023 the FDA approved ZURZUVAE for adults with PPD, pending DEA scheduling, which was completed in October 2023.

Upon approval, ZURZUVAE for PPD became the first and only oral, once-daily, 14-day treatment that can provide rapid improvements in depressive symptoms by day 15 for women with PPD.

ZURZUVAE for PPD became commercially available in the U.S.

during the fourth quarter of 2023.

Additionally, the FDA issued a CRL for the NDA for zuranolone in the treatment of adults with MDD.

The CRL stated that the application did not provide substantial evidence of effectiveness to support the approval of zuranolone for the treatment of MDD and that an additional study or studies would be needed.

We and Sage are continuing to seek feedback from the FDA and evaluating next steps.

T able of Contents

BUSINESS COMBINATIONS

REATA ACQUISITION

On September 26, 2023, we completed the acquisition of all of the issued and outstanding shares of Reata, a biopharmaceutical company focused on developing therapeutics that regulate cellular metabolism and inflammation in serious neurologic diseases.

As a result of this transaction we acquired SKYCLARYS (omaveloxolone), the first and only drug approved in the U.S.

for the treatment of Friedreich's Ataxia in adults and adolescents aged 16 years and older, as well as other clinical and preclinical pipeline programs.

Under the terms of this acquisition, we paid Reata shareholders $172.50 in cash for each issued and outstanding Reata share, which totaled approximately $6.6 billion.

In addition, we agreed to pay approximately $983.9 million in cash for Reata's outstanding equity awards, inclusive of employer taxes, of which approximately $590.5 million was attributable to pre-acquisition services and is therefore reflected as a component of total purchase price paid.

Of the $983.9 million paid to Reata's equity award holders, we recognized approximately $393.4 million as compensation attributable to the post-acquisition service period, of which $196.4 million was recognized as a charge to selling, general and administrative expense with the remaining $197.0 million as a charge to research and development expense within our consolidated statements of income for the year ended December 31, 2023 .

These amounts were associated with the accelerated vesting of stock options and RSUs previously granted to Reata employees that required no future services to vest.

For additional information on our acquisition of Reata, please read Note 2, Acquisitions , to our consolidated financial statements included in this report.

OTHER KEY DEVELOPMENTS

Tofersen (BIIB067)

In July 2022 we announced that the FDA accepted the NDA and granted Priority Review for tofersen, an investigational antisense drug being evaluated for people with SOD1 ALS, which currently has a PDUFA action date of April 25, 2023.

In December 2022 the EMA accepted for review the MAA for tofersen.

BIIB800 (referencing ACTEMRA)

In September 2022 we and our collaboration partner Bio-Thera announced that the EMA accepted for review the MAA for BIIB800, a proposed tocilizumab biosimilar referencing ACTEMRA, an anti-interleukin-6 receptor monoclonal antibody, for the treatment of severe, active and progressive rheumatoid arthritis.

In December 2022 the FDA accepted for review the abbreviated BLA for BIIB800.

BIIB122 (DNL151)

In October 2022 we and our collaboration partner Denali announced the initiation of the Phase 3 LIGHTHOUSE study of BIIB122 for the potential treatment of Parkinson's disease.

For additional information on our collaboration arrangement with Denali, please read Note 19, Collaborative and Other Relationships, to our consolidated financial statements included in this report .

SKYCLARYS (omaveloxolone)

In February 2024 the EC approved SKYCLARYS in the E.U.

for the treatment of FA in adults and adolescents aged 16 years and older.

SKYCLARYS is the first treatment approved within the E.U.

for this rare, genetic, progressive neurodegenerative disease.

QALSODY (tofersen)

In April 2023 the FDA approved QALSODY for the treatment of ALS in adults who have a mutation in the SOD1 gene.

This indication is approved under accelerated approval based on reduction in plasma neurofilament light chain observed in patients treated with QALSODY.

Continued approval for this indication may be contingent upon verification of clinical benefit in confirmatory trial(s).

until at least February 2, 2025, and are seeking to enforce this protection.

In December 2023, the EC revoked all centralized marketing authorizations for generic versions of TECFIDERA.

As of December 31, 2023, some of the TECFIDERA generics have not yet fully exited some E.U.

markets and we expect removal of all generics from the market will take additional time.

We are closely monitoring this situation and working to enforce our legal right to market protection.

In addition, we will continue to enforce our EP 2 653 873 patent related to TECFIDERA, which expires in 2028.

CORPORATE MATTERS

Samsung Bioepis - Biogen's Joint Venture with Samsung BioLogics

In April 2022 we completed the sale of our 49.9% equity interest in Samsung Bioepis to Samsung BioLogics.

Under the terms of this transaction, we received approximately $1.0 billion in cash at closing and expect to receive approximately $1.3 billion in cash to be deferred over two payments of approximately $812.5 million due at the first anniversary and approximately $437.5 million due at the second anniversary of the closing of this transaction.

As part of this transaction, we are also eligible to receive up to an additional $50.0 million upon the achievement of certain commercial milestones.

Our policy for contingent payments of this nature is to recognize the payments in the period that they become realizable, which is generally the same period in which the payments are earned.

Table of Conten ts

For additional information on the sale of our equity interest in Samsung Bioepis, please read Note 3, Dispositions, to our consolidated financial statements included in this report.

2022 Cost Saving Initiatives

In December 2021 and May 2022 we announced our plans to implement a series of cost-reduction measures that when completed we expect may yield approximately $1.0 billion in expense savings.

These savings are being achieved through a number of initiatives, including reductions to our workforce, the substantial elimination of our commercial ADUHELM infrastructure, the consolidation of certain real estate locations and operating efficiency gains across our selling, general and administrative and research and development functions.

Under these initiatives, we estimate we will incur total restructuring charges of approximately $131.0 million, primarily related to severance.

These amounts were substantially incurred during 2022.

As of December 31, 2022, approximately $35.9 million remained in our restructuring reserve and payments are expected to be made through 2026.

For additional information on our 2022 cost saving initiatives, please read Note 4, Restructuring , to our consolidated financial statements included in this report.

Senior Note Redemption

In July 2022 we redeemed our 3.625% Senior Notes totaling $1.0 billion in aggregate principal amount prior to their maturity on September 15, 2022.

For additional information on the redemption of our Senior Notes, please read Note 13, Indebtedness , to our consolidated financial statements included in this report.

125 Broadway Sale and Leaseback Transaction

In September 2022 we completed the sale of our building and land parcel located at 125 Broadway for an aggregate sales price of approximately $603.0 million, which is inclusive of a $10.8 million tenant allowance.

Simultaneously, with the close of this transaction we leased back the building for a term of approximately 5.5 years.

For additional information on our 125 Broadway sale and leaseback transaction, please read Note 11, Property, Plant and Equipment and Note 12, Leases , to our consolidated financial statements included in this report.

FIT FOR GROWTH

In 2023 we initiated additional cost saving measures as part of our Fit for Growth program to reduce operating costs, while improving operating efficiency and effectiveness.

The Fit for Growth program is expected to generate approximately $1.0 billion in gross operating expense savings and $800.0 million in net operating expense savings by 2025, some of which will be reinvested in various initiatives.

The Fit for Growth program is currently estimated to include net headcount reductions of approximately 1,000 employees and we expect to incur restructuring charges ranging from approximately $260.0 million to $280.0 million.

For additional information on our Fit for Growth program, please read Note 4, Restructuring , to our consolidated financial statements included in this report.

T able of Contents

DISCONTINUED PROGRAMS AND STUDIES

ENVISION STUDY

In November 2023 we notified Neurimmune of our decision to terminate our collaboration and license agreement with Neurimmune, to discontinue the development and commercialization of ADUHELM and to terminate the ENVISION clinical study.

In connection with this termination, we recorded close-out costs of approximately $60.0 million in research and development expense within our consolidated statements of income for the year ended December 31, 2023.

In September 2023 we discontinued our EMBARK study for aducanumab.

In connection with this discontinuation we recorded termination costs of approximately $43.0 million in research and development expense within our consolidated statements of income for the year ended December 31, 2023 .

ACORDA COLLABORATION

In January 2024 we notified Acorda of our decision to terminate our collaboration and license agreement, effective January 1, 2025.

As a result of this termination, Acorda will regain global commercialization rights to FAMPYRA.

In June 2023 we and Denali announced plans to terminate the Phase 3 LIGHTHOUSE study for BIIB122, a small molecule inhibitor of LRRK2 in Parkinson's disease.

The protocol for the Phase 2b LUMA study for BIIB122 in patients with early-stage Parkinson’s disease was amended to now include eligible patients with a LRRK2 genetic mutation in addition to continuing to enroll eligible patients with early-stage idiopathic Parkinson’s disease.

In April 2023 we announced that we would terminate the development of BIIB093 (glibenclamide IV), currently in a Phase 3 study for LHI and a Phase 2 study for brain contusion, due to operational challenges and other strategic considerations.

In connection with this termination, we recorded close-out costs of approximately $13.2 million in research and development expense within our consolidated statements of income for the year ended December 31, 2023.

In April 2023 we announced that we will be pausing the initiation of a Phase 2b study for BIIB131 (TMS-007) for acute ischemic stroke and will continue to assess whether to initiate this study.

We sold the rights to BIIB131 to a third-party biopharmaceutical company in exchange for an upfront with potential milestones and future royalties on global sales.

In April 2023 we announced that we would discontinue further development of BIIB132 in spinocerebellar ataxia type 3, as part of our ongoing research and development prioritization initiative.

T able of Contents

RESULTS OF OPERATIONS

The following revenue discussion should be read in conjunction with Note 5, Revenue , to our consolidated financial statements included in this report.

Revenue is summarized as follows:

6 unchanged sentences

Revenue from anti-CD20 therapeutic programs 1,689.6 1,700.5 1,658.5 (0.6) 2.5 (10.9) 42.0

Other revenue 485.1 476.3 774.6 1.8 (38.5) 8.8 (298.3)

Contract manufacturing, royalty and other revenue 899.3 485.1 476.3 85.4 1.8 414.2 8.8

Total revenue $ 9,835.6 $ 10,173.4 $ 10,981.7 (3.3) % (7.4) % $ (337.8) $ (808.3)

Table of Conten ts

PRODUCT REVENUE

2 unchanged sentences

(In millions, except percentages) 2023 2022 2021

Multiple Sclerosis (MS):

TECFIDERA $ 1,443.9 $ 1,951.9 $ 3,841.1 (26.0) % (49.2) % $ (508.0) $ (1,889.2)

553.4 410.4 64.3 34.8 538.3 143.0 346.1

Total Fumarate 1,997.3 2,362.3 3,905.4 (15.5) (39.5) (365.0) (1,543.1)

AVONEX 973.5 1,208.7 1,491.9 (19.5) (19.0) (235.2) (283.2)

PLEGRIDY 331.9 357.4 385.6 (7.1) (7.3) (25.5) (28.2)

Total Interferon 1,305.4 1,566.1 1,877.5 (16.6) (16.6) (260.7) (311.4)

TYSABRI 2,030.9 2,063.1 1,946.1 (1.6) 6.0 (32.2) 117.0

FAMPYRA 96.6 105.2 103.1 (8.2) 2.0 (8.6) 2.1

MS 5,430.2 6,096.7 7,832.1 (10.9) (22.2) (666.5) (1,735.4)

Spinal Muscular Atrophy:

SPINRAZA 1,793.5 1,905.1 2,052.1 (5.9) (7.2) (111.6) (147.0)

BENEPALI 441.0 498.3 481.6 (11.5) 3.5 (57.3) 16.7

IMRALDI 224.5 233.4 216.3 (3.8) 7.9 (8.9) 17.1

FLIXABI 81.3 99.4 97.9 (18.2) 1.5 (18.1) 1.5

4.3 — — nm — 4.3 —

Multiple Sclerosis $ 4,661.9 $ 5,430.2 $ 6,096.7 (14.1) % (10.9) % $ (768.3) $ (666.5)

Rare disease 1,803.0 1,793.5 1,905.1 0.5 (5.9) 9.5 (111.6)

Biosimilars 770.0 751.1 831.1 2.5 (9.6) 18.9 (80.0)

FUMADERM 8.2 11.0 12.2 (25.5) (9.8) (2.8) (1.2)

ADUHELM 4.8 3.0 — 60.0 nm 1.8 3.0

11.8 13.0 14.0 (9.2) (7.1) (1.2) (1.0)

Total product revenue, net $ 7,246.7 $ 7,987.8 $ 8,846.9 (9.3) % (9.7) % $ (741.1) $ (859.1)

(1) VUMERITY became commercially available in the E.U.

(1) Other includes FUMADERM, ADUHELM and ZURZUVAE, which became commercially available in the U.S.

during the fourth quarter of 2023.

(2) BYOOVIZ launched in the U.S.

in June 2022 and became commercially available during the third quarter of 2022.

nm Not meaningful

Table of Conten ts

Multiple Sclerosis (MS)

Fumarate revenue includes sales from TECFIDERA and VUMERITY.

During the fourth quarter of 2021 VUMERITY was approved for the treatment of RRMS in the E.U., Switzerland and the U.K.

For 2022 compared to 2021, the 13.8% decrease in U.S.

Fumarate revenue was primarily due to a decrease in TECFIDERA demand as a result of multiple TECFIDERA generic entrants in the U.S.

market, partially offset by net price increases in TECFIDERA driven by lower pharmacy rebates, managed care rebates and co-pay assistance as well as an increase in VUMERITY sales volumes.

For 2022 compared to 2021, the 16.9% decrease in rest of world Fumarate revenue was primarily due to TECFIDERA pricing reductions and a decrease in TECFIDERA demand as multiple TECFIDERA generic entrants entered into markets such as Germany and Canada.

The decrease was also driven by the unfavorable impact of foreign currency exchange, partially offset by an increase in VUMERITY sales volumes.

In the E.U., we are seeking to enforce a patent granted in June 2022 that relates to TECFIDERA and expires in 2028.

In addition, we are litigating to affirm that TECFIDERA is entitled to regulatory data and market protection until at least February 2024.

Our Company, the EMA and the EC have each appealed the May 2021 decision of the European General Court, which annulled the EMA's decision not to

validate an application for approval of a TECFIDERA generic on the basis that the EMA and EC conducted the wrong assessment when determining TECFIDERA's entitlement to regulatory data and marketing protection.

Our Company, the EMA and the EC have each appealed the General Court’s decision as wrongly decided and the appeal is pending.

On October 6, 2022, the Advocate General of the CJEU issued a nonbinding advisory opinion in Biogen's favor.

This opinion recommends that the CJEU set aside the judgment of the European General Court.

We are awaiting the decision of the CJEU.

For additional information, please read Note 21, Litigation, to our consolidated financial statements included in this report.

We expect that TECFIDERA revenue will continue to decline in 2023, compared to 2022, as a result of generic competition in the North America, Latin America and certain E.U.

We expect an increase in VUMERITY sales volumes in 2023, compared to 2022, mostly due to demand growth in the U.S.

and select European markets.

We believe that we have resolved previously reported manufacturing issues at our contract manufacturer.

T able of Contents

MULTIPLE SCLEROSIS

• Global TECFIDERA revenue decreased $431.4 million, from $1,443.9 million in 2022 to $1,012.5 million in 2023, or 29.9%, driven by a decrease in demand as a result of multiple TECFIDERA generic entrants in North America, Brazil and certain E.U.

• Global Interferon revenue decreased $199.7 million, from $1,305.4 million in 2022 to $1,105.7 million in 2023, or 15.3%, driven by a decrease in sales volumes as patients transition to higher efficacy therapies.

• Global VUMERITY revenue increased $22.9 million, from $553.4 million in 2022 to $576.3 million in 2023, or 4.1%, primarily due to an increase in global demand, partially offset by higher discounts and allowances in the U.S.

driven by a favorable Medicaid-related sales adjustment in the first quarter of 2022.

• Global TYSABRI revenue decreased $154.0 million, from $2,030.9 million in 2022 to $1,876.9 million in 2023, or 7.6%, primarily due to a decrease in U.S.

TYSABRI revenue driven by a decrease in demand, higher discounts and unfavorable channel dynamics.

MS revenue includes sales from TECFIDERA, VUMERITY, AVONEX, PLEGRIDY, TYSABRI and FAMPYRA.

In 2024 we expect total MS revenue will continue to decline as a result of increasing competition for many of our MS products in both the U.S.

and rest of world markets.

We are also aware of a biosimilar entrant of TYSABRI that was approved in the U.S.

in August 2023 and the E.U.

in September 2023.

We believe that future sales of TYSABRI may be adversely affected by the entrance of this biosimilar.

We believe that we have resolved previously reported manufacturing issues at our VUMERITY contract manufacturer.

In addition, we are in the process of securing regulatory approval for a secondary source of supply.

We do not anticipate a supply shortage in 2024 and are currently focused on rebuilding adequate inventory.

Table of Conten ts

For 2022 compared to 2021, the 18.9% decrease in U.S.

Interferon revenue was primarily due to a decrease in Interferon sales volumes of 15.5%.

The net decline in sales volumes reflects the continued decline of the Interferon market as patients transition to higher efficacy and oral MS therapies.

For 2022 compared to 2021, the 12.9% decrease in rest of world Interferon revenue was primarily due to a decrease in Interferon sales volumes of 6.0% resulting from the continued decline of the Interferon market as patients transition to higher efficacy and oral MS therapies, as well as the unfavorable impact of foreign currency exchange.

We expect that Interferon revenue will continue to decline in both the U.S.

and rest of world markets in 2023, compared to 2022, as a result of increasing competition from other MS products.

For 2022 compared to 2021, U.S.

TYSABRI revenue was relatively flat, with a modest decrease in sales volumes, partially offset by an increase in pricing, net of higher discounts and allowances.

For 2022 compared to 2021, rest of world TYSABRI revenue was relatively flat, with a modest decrease in pricing and the unfavorable impact of foreign currency exchange, partially offset by an increase in sales volumes.

We anticipate TYSABRI revenue to be relatively flat on a global basis in 2023, compared to 2022, despite increasing competition from additional treatments for MS.

We expect to continue to face price reductions in certain European markets.

We are also aware of a potential biosimilar entrant of TYSABRI that may enter the U.S.

and European markets as early as 2023.

Table of Conten ts

Spinal Muscular Atrophy

For 2022 compared to 2021, U.S.

SPINRAZA revenue was relatively flat, with a modest increase in sales volumes of 3.7%, resulting from the timing of shipments, partially offset by higher discounts and allowances.

For 2022 compared to 2021, the 9.4% decrease in rest of world SPINRAZA revenue was primarily due to country mix, the unfavorable impact of foreign currency exchange and the timing of shipments, partially offset by an increase in sales volumes.

Despite competition from a gene therapy product and an oral product, we anticipate SPINRAZA revenue to be relatively flat in 2023, compared to 2022.

Moderate growth in the U.S.

as well as continued access expansion in emerging markets is expected to offset increased competition and the impact of loading dose dynamics.

For additional information on our collaboration arrangements with Ionis, please read Note 19, Collaborative and Other Relationships, to our consolidated financial statements included in this report.

BENEPALI, IMRALDI, FLIXABI and BYOOVIZ

During the third quarter of 2021 BYOOVIZ, a ranibizumab biosimilar referencing LUCENTIS, was approved in the U.S., the E.U and the U.K.

T able of Contents

SPINRAZA revenue increased $10.3 million, from $600.2 million in 2022 to $610.5 million in 2023, or 1.7%, primarily due to an increase in pricing, partially offset by higher discounts and allowances.

• Rest of world SPINRAZA revenue decreased $62.6 million, from $1,193.3 million in 2022 to $1,130.7 million in 2023, or 5.2%, primarily due to the unfavorable impact of foreign currency exchange, a decrease in demand in certain European markets driven by increased competition, a decrease in pricing and the timing of shipments in certain Asian markets.

SKYCLARYS revenue was $55.9 million in 2023, which we began recognizing during the fourth quarter of 2023, subsequent to our acquisition of Reata.

Rare disease revenue includes sales from SPINRAZA, QALSODY, which became commercially available in the U.S.

during the second quarter of 2023, and SKYCLARYS (omaveloxolone), which was obtained as part of our acquisition of Reata in September 2023.

SKYCLARYS became commercially available in the U.S.

during the second quarter of 2023 and we began recognizing revenue from SKYCLARYS in the U.S.

during the fourth quarter of 2023, subsequent to our acquisition of Reata.

In February 2024 the EC approved SKYCLARYS in the E.U.

for the treatment of FA in adults and adolescents aged 16 years and older.

In 2024 we expect growth in rare disease revenue as we continue to launch SKYCLARYS in the U.S.

Despite competition from a gene therapy product and an oral product, we anticipate SPINRAZA revenue to be relatively flat in 2024.

We expect moderate growth in SPINRAZA in the U.S.

as well as continued access expansion in emerging markets to offset increased competition and the impact of loading dose dynamics.

T able of Contents

• For 2023 compared to 2022, the increase in biosimilar revenue was primarily due to an increase in sales volumes related to the continued launch of BYOOVIZ in the U.S.

and rest of world, partially offset by unfavorable BYOOVIZ pricing and the unfavorable impact of foreign currency exchange.

Biosimilars revenue includes sales from BENEPALI, IMRALDI, FLIXABI and BYOOVIZ.

BYOOVIZ launched in the U.S.

in June 2022 and became commercially available in July 2022 through major distributors in the U.S.

For 2022 compared to 2021, the 9.6% decrease in biosimilar revenue was primarily due to unfavorable pricing and the unfavorable impact of foreign currency exchange, partially offset by an increase in sales volumes.

We anticipate modest growth in revenue from our biosimilars business in 2023, compared to 2022, driven by the continued launch of BYOOVIZ in the U.S.

and rest of world, offset in part by continued price reductions in certain markets.

We are currently working with our contract manufacturer for IMRALDI to address facility regulatory inspection deficiencies at two filling locations, which could impact supply and have an adverse impact on 2023 IMRALDI sales, if not resolved.

Manufacturing of BENEPALI also utilizes one of these facilities and therefore could have an adverse impact on 2023 BENEPALI sales.

We are working with our existing secondary supplier for BENEPALI with the aim to secure additional capacity.

Table of Conten ts

For additional information on our collaboration arrangements with Samsung Bioepis, please read Note 19, Collaborative and Other Relationships, to our consolidated financial statements included in this report.

In 2023 BYOOVIZ became commercially available in certain international markets.

During the third quarter of 2023 the FDA approved TOFIDENCE, a tocilizumab biosimilar referencing ACTEMRA, which we expect to become commercially available during 2024.

In 2024 we anticipate modest growth in revenue from our biosimilars business driven by the continued launch of BYOOVIZ in the U.S.

and rest of world, offset in part by lower pricing in certain markets.

We continue to work with our third-party contract manufacturers for IMRALDI and BENEPALI to address supply constraints.

If not resolved these supply constraints could have an adverse impact on 2024 sales.

In addition, one of our contract manufacturers for IMRALDI and BENEPALI entered into a proposed acquisition by a third party, which is expected to close at the end of 2024.

We are currently evaluating the impact this will have on our biosimilars business.

In February 2023 we announced that we are exploring strategic options for our biosimilars business.

T able of Contents

REVENUE FROM ANTI-CD20 THERAPEUTIC PROGRAMS

Genentech (Roche Group)

Our share of RITUXAN, including RITUXAN HYCELA, and GAZYVA collaboration operating profits in the U.S., royalty revenue on sales of OCREVUS and other revenue from anti-CD20 therapeutic programs are summarized in the table below.

Our share of RITUXAN, including RITUXAN HYCELA, GAZYVA and LUNSUMIO collaboration operating profits in the U.S., royalty revenue on sales of OCREVUS and other revenue from anti-CD20 therapeutic programs are summarized in the table below.

For purposes of this discussion, we refer to RITUXAN and RITUXAN HYCELA collectively as RITUXAN.

For the Years Ended December 31,

(In millions) 2023 2022 2021

Royalty revenue on sales of OCREVUS $ 1,266.2 $ 1,136.3 $ 991.7

Biogen’s share of pre-tax profits in the U.S.

for RITUXAN and GAZYVA

for RITUXAN, GAZYVA and LUNSUMIO (1)

409.4 547.0 647.7

Other revenue from anti-CD20 therapeutic programs 14.0 17.2 19.1

Total revenue from anti-CD20 therapeutic programs $ 1,689.6 $ 1,700.5 $ 1,658.5

(1) LUNSUMIO became commercially available in the U.S.

during the first quarter of 2023.

ROYALTY REVENUE ON SALES OF OCREVUS

For 2023 compared to 2022, the increase in royalty revenue on sales of OCREVUS was primarily due to sales growth of OCREVUS in the U.S.

OCREVUS royalty revenue is based on our estimates from third party and market research data of OCREVUS sales occurring during the corresponding period.

Differences between actual and estimated royalty revenue will be adjusted for in the period in which they become known, which is generally expected to be the following quarter.

BIOGEN'S SHARE OF PRE-TAX PROFITS IN THE US.

FOR RITUXAN, GAZYVA AND LUNSUMIO

The following table provides a summary of amounts comprising our share of pre-tax profits in the U.S.

for RITUXAN and GAZYVA:

for RITUXAN, GAZYVA and LUNSUMIO:

For the Years Ended December 31,

7 unchanged sentences

product revenue, net was primarily due to a decrease in sales volumes of RITUXAN in the U.S.

28.4%, primarily due to the onset of competition from multiple biosimilar products.

For 2022 compared to 2021, the decrease in collaboration costs and expense was primarily due to lower cost of sales, selling and marketing expense, distribution costs and other costs and expense related to RITUXAN.

of 15.2%, resulting from competition from multiple biosimilar products, partially offset by an increase in sales volumes of GAZYVA of 17.9%.

For 2023 compared to 2022, the increase in collaboration costs and expense was primarily due to higher expense related to LUNSUMIO, which became commercially available in the first quarter of 2023.

In April 2023 our pre-tax profit share for RITUXAN, GAZYVA and LUNSUMIO decreased from 37.5% to 35.0%.

Prior to regulatory approval, we record our share of the expense incurred by the collaboration for the development of anti-CD20 products in research and development expense and pre-commercialization costs within selling, general and administrative expense in our consolidated statements of income.

After an anti-CD20 product is approved, we record our share of the development and sales and marketing expense related to that product as a reduction of our share of pre-tax profits in revenue from anti-CD20 therapeutic programs.

We are aware of several other anti-CD20 molecules, including biosimilar products, that have been approved and are competing with RITUXAN and GAZYVA in the oncology and other markets.

3 unchanged sentences

in future years.

Royalty Revenue on Sales of OCREVUS

For 2022 compared to 2021, the increase in royalty revenue on sales of OCREVUS was primarily due to sales growth of OCREVUS in the U.S.

OCREVUS royalty revenue is based on our estimates from third party and market research data of OCREVUS sales occurring during the corresponding period.

Differences between actual and estimated royalty revenue will be adjusted for in the period in which they become known, which is generally expected to be the following quarter.

T able of Contents

OTHER REVENUE FROM ANTI-CD20 THERAPEUTIC PROGRAMS

Other revenue from anti-CD20 therapeutic programs consists of our share of pre-tax co-promotion profits from RITUXAN in Canada.

In December 2022 the FDA approved LUNSUMIO, a bispecific antibody for the treatment of relapsed or refractory follicular lymphoma.

Our share of pre-tax profits and losses on LUNSUMIO will be included as a component of revenue from anti-CD20 therapeutic programs in our consolidated statements of income.

For the year ended December 31, 2022, LUNSUMIO revenue was immaterial.

Other revenue from anti-CD20 therapeutic programs consists of our share of pre-tax co-promotion profits from RITUXAN in Canada, royalty revenue on sales of LUNSUMIO outside the U.S.

and royalty revenue on net sales of COLUMVI in the U.S, which became commercially available during the second quarter of 2023.

For additional information on our collaboration arrangements with Genentech, including information regarding the pre-tax profit-sharing formula and its impact on future revenue from anti-CD20 therapeutic programs, please read Note 19, Collaborative and Other Relationships, to our consolidated financial statements included in this report.

Table of Conten ts

Other Revenue

Other revenue consists of royalty revenue and contract manufacturing and other revenue and is summarized as follows:

Royalty Revenue and Contract Manufacturing and Other Revenue

Contract Manufacturing and Other Revenue

We record contract manufacturing and other revenue primarily from amounts earned under contract manufacturing agreements.

For 2022 compared to 2021, the decrease in contract manufacturing and other revenue was primarily due to lower contract manufacturing revenue related to the timing of batch releases.

Royalty Revenue

We receive royalties from net sales on products related to patents that we have out-licensed, as well as royalty revenue on biosimilar products from our collaboration arrangements with Samsung Bioepis.

CONTRACT MANUFACTURING, ROYALTY AND OTHER REVENUE

Contract manufacturing, royalty and other revenue is summarized as follows:

For the Years Ended December 31,

(In millions) 2023 2022 2021

Contract manufacturing revenue $ 848.2 $ 417.7 $ 427.7

Royalty and other revenue 51.1 67.4 48.6

Total contract manufacturing, royalty and other revenue $ 899.3 $ 485.1 $ 476.3

CONTRACT MANUFACTURING REVENUE

We record contract manufacturing revenue primarily from amounts earned under contract manufacturing agreements with our strategic customers.

For 2023 compared to 2022, the increase in contract manufacturing revenue was primarily driven by higher volumes due to the timing of batch production, which includes batches related to LEQEMBI that we began recognizing in the first quarter of 2023 upon the accelerated approval of LEQEMBI in the U.S.

As part of the 2020 sale of our Hillerød, Denmark manufacturing operations to FUJIFILM, we provided FUJIFILM with certain minimum batch production commitment guarantees, including batches related to our contract manufacturing arrangements.

As of December 31, 2023, these batch commitments have been satisfied and we expect that our contract manufacturing revenue will be lower in 2024, compared to 2023, as we are no longer supplying contract manufacturing customers in this manner.

For additional information on our collaboration arrangements with Eisai, please read Note 19, Collaborative and Other Relationships, to our consolidated financial statements included in this report.

ROYALTY AND OTHER REVENUE

Royalty and other revenue primarily reflects the royalties we receive from net sales on products related to patents that we have out-licensed, as well as royalty revenue on biosimilar products from our license arrangements with Samsung Bioepis and our 50.0% share of LEQEMBI product revenue, net and cost of sales, including royalties, as we are not the principal.

For additional information on our collaborative arrangements with Samsung Bioepis, please read Note 19, Collaborative and Other Relationships , to our consolidated financial statements included in this report.

RESERVES FOR DISCOUNTS AND ALLOWANCES

Revenue from product sales is recorded net of reserves established for applicable discounts and

allowances, including those associated with the implementation of pricing actions in certain international markets where we operate.

Revenue from product sales is recorded net of reserves established for applicable discounts and allowances, including those associated with the implementation of pricing actions in certain international markets where we operate.

These reserves are based on estimates of the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (if the amount is payable to our customer) or a liability (if the amount is payable to a party other than our customer).

2 unchanged sentences

If actual results vary, we adjust these estimates, which could have an effect on earnings in the period of adjustment.

T able of Contents

Reserves for discounts, contractual adjustments and returns that reduced gross product revenue are summarized as follows:

Table of Conten ts

For the Years Ended December 31,

(In millions) 2023 2022 2021

Contractual adjustments $ 2,681.7 $ 2,716.9 $ 2,852.6

Discounts 735.2 663.9 732.8

Returns 38.2 5.1 11.9

Total discounts and allowances $ 3,455.1 $ 3,385.9 $ 3,597.3

For the years ended December 31, 2023, 2022 and 2021, reserves for discounts and allowances as a percentage of gross product revenue were 32.0%, 30.1% and 28.6%, respectively.

Discounts include trade term discounts and wholesaler incentives.

For 2022 compared to 2021, the decrease in discounts was primarily due to a decrease in gross sales, driven by lower TECFIDERA sales, offset by higher purchase discounts for TYSABRI.

CONTRACTUAL ADJUSTMENTS

Contractual adjustments primarily relate to Medicaid and managed care rebates in the U.S., pharmacy rebates, co-payment (copay) assistance, Veterans Administration, 340B discounts, specialty pharmacy program fees and other government rebates or applicable allowances.

For 2022 compared to 2021, the decrease in contractual adjustments was primarily driven by lower

TECFIDERA sales in the U.S., resulting in lower pharmacy rebates, Medicaid rebates and managed care rebates, as well as lower Medicaid rebates in the U.S.

driven by a favorable change in estimates for VUMERITY.

Contractual adjustments primarily relate to Medicaid and managed care rebates in the U.S., pharmacy rebates, co-payment (copay) assistance, VA, 340B discounts, specialty pharmacy program fees and other government rebates or applicable allowances.

For 2023 compared to 2022, the decrease in contractual adjustments was primarily due to lower government rebates in the U.S.

as a result of a contract pharmacy change made during the first quarter of 2023 related to our Interferons, partially offset by higher managed care and Medicaid rebates in the U.S.

and higher government rebates in rest of world.

Discounts include trade term discounts and wholesaler incentives.

For 2023 compared to 2022, the increase in discounts was primarily driven by higher purchase and volume discounts for biosimilars.

Product return reserves are established for returns made by wholesalers.

1 unchanged sentence

The majority of wholesaler returns are due to product expiration.

Provisions for product returns are recognized in the period the related revenue is recognized, resulting in a reduction to product sales.

For 2022 compared to 2021, return reserves were relatively consistent.

Provisions for estimated product returns are recognized in the period the related revenue is recognized, resulting in a reduction to product sales.

For 2023 compared to 2022, the increase in returns was primarily driven by higher return rates in the U.S.

For additional information on our revenue reserves, please read Note 5, Revenue, to our consolidated financial statements included in this report.

T able of Contents

COST AND EXPENSE

6 unchanged sentences

Amortization and impairment of acquired intangible assets 240.6 365.9 881.3 (34.2) (58.5) (125.3) (515.4)

Collaboration profit (loss) sharing (7.4) 7.2 232.9 (202.8) (96.9) (14.6) (225.7)

(Gain) loss on divestiture of Hillerød, Denmark manufacturing operations — — (92.5) — nm — 92.5

(Gain) loss on fair value remeasurement of contingent consideration (209.1) (50.7) (86.3) 312.4 (41.3) (158.4) 35.6

Acquired in-process research and development — 18.0 75.0 (100.0) (76.0) (18.0) (57.0)

Collaboration profit sharing/(loss reimbursement) 218.8 (7.4) 7.2 nm (202.8) 226.2 (14.6)

(Gain) loss on fair value remeasurement of contingent consideration — (209.1) (50.7) nm 312.4 209.1 (158.4)

Acquired in-process research and development — — 18.0 — nm — (18.0)

Restructuring charges 218.8 131.1 — 66.9 nm 87.7 131.1

Gain on sale of building (503.7) — — nm — (503.7) —

Gain on sale of building — (503.7) — nm nm 503.7 (503.7)

Other (income) expense, net 315.5 (108.2) 1,095.5 (391.6) (109.9) 423.7 (1,203.7)

1 unchanged sentence

nm Not meaningful

Table of Conten ts

COST OF SALES, EXCLUDING AMORTIZATION AND IMPAIRMENT OF ACQUIRED INTANGIBLE ASSETS

For the Years Ended December 31,

(In millions) 2023 2022 2021

Product $ 1,787.2 $ 1,504.8 $ 1,281.2

Royalty 746.2 773.5 828.5

Total cost of sales $ 2,533.4 $ 2,278.3 $ 2,109.7

Cost of sales, as a percentage of total revenue, were 25.8%, 22.4% and 19.2% for the years ended December 31, 2023, 2022 and 2021, respectively.

PRODUCT COST OF SALES

For 2022 compared to 2021, the increase in product cost of sales was primarily due to higher charges in 2022 associated with the write-off of excess ADUHELM inventory and purchase commitments, higher gross idle capacity charges associated with our manufacturing facilities and increased product cost of sales driven by product mix.

For 2023 compared to 2022, the increase in product cost of sales was primarily due to unfavorable product mix from increased contract manufacturing revenue, MS product mix and higher idle capacity charges, partially offset by a decrease in excess and obsolescence inventory charges in 2023.

Contract manufacturing revenue includes LEQEMBI inventory produced for Eisai, beginning in the first quarter of 2023 upon the accelerated approval of LEQEMBI in the U.S.

Cost of sales as a percentage of revenue was adversely affected by LEQEMBI batches due to minimal margins.

The increase was partially offset by a decrease in excess and obsolescence inventory charges as 2022 included a write-off of approximately $275.0 million during the first quarter of 2022 of excess inventory and contractual commitments related to ADUHELM.

As a result of our acquisition of Reata in September 2023 we recorded a fair value step-up adjustment related to the acquired inventory of SKYCLARYS of approximately $1.3 billion.

This fair value step-up adjustment will be amortized to cost of sales within our consolidated statements of income when the inventory is sold, which is expected to be within approximately 3 years from the acquisition date.

For the year ended December 31, 2023, amortization from the fair value step-up adjustment as a result of inventory sold during the fourth quarter was approximately $31.5 million.

For additional information on our acquisition of Reata, please read Note 2, Acquisitions , to our consolidated financial statements included in this report.

Write Downs and Other Charges

Inventory amounts written down as a result of excess, obsolescence or unmarketability totaled $124.4 million, $336.2 million and $167.6 million for the years ended December 31, 2023, 2022 and 2021, respectively.

For the years ended December 31, 2022 and 2021, we recorded approximately $286.0 million and $170.0 million, respectively, of charges associated with the write-off of ADUHELM inventory and purchase commitments in excess of forecasted demand.

T able of Contents

For the year ended December 31, 2022, we recorded approximately $286.0 million of charges associated with the write-off of ADUHELM inventory and contractual commitments in excess of forecasted demand.

We also recognized approximately $197.0 million related to Eisai's 45.0% share of inventory, idle capacity charges and contractual commitments in collaboration profit sharing/(loss reimbursement) within our consolidated statements of income for the year ended December 31, 2022.

For the years ended December 31, 2023 and 2022, we recorded approximately $165.2 million and $119.0 million, respectively, of aggregate gross idle capacity charges.

We have also recognized approximately $197.0 million and $99.0 million related to Eisai's 45.0% share of inventory, idle capacity charges and contractual commitments, which was recorded in collaboration profit (loss) sharing within our consolidated statements of income for the years ended December 31, 2022 and 2021, respectively.

For additional information on our collaboration arrangements with Eisai, please read Note 19, Collaborative and Other Relationships , to our consolidated financial statements included in this report.

ROYALTY COST OF SALES

For 2022 compared to 2021, the decrease in royalty cost of sales was primarily due to lower royalties payable on lower sales of SPINRAZA, TYSABRI and AVONEX, partially offset by higher royalties payable on higher sales of VUMERITY.

For 2023 compared to 2022, the decrease in royalty cost of sales was primarily due to lower royalties payable on lower sales of TYSABRI, partially offset by an increase in royalty cost of sales due to higher royalties payable on higher sales of VUMERITY and SKYCLARYS, which we began recognizing in the fourth quarter of 2023, subsequent to our acquisition of Reata.

T able of Contents

RESEARCH AND DEVELOPMENT

Table of Conten ts

We support our drug discovery and development efforts through the commitment of significant resources to discovery, research and development programs and business development opportunities.

A significant amount of our research and development costs consist of indirect costs incurred in support of overall research and development activities and non-specific programs, including activities that benefit multiple programs, such as management costs, as well as depreciation, information technology and facility-based expenses.

These costs are considered other research and development costs in the table above and are not allocated to a specific program or stage.

Research and development expense incurred in support of our marketed products includes costs associated with product lifecycle management activities including, if applicable, costs associated with the development of new indications for existing products.

Late stage programs are programs in Phase 3 development or in registration stage.

Early stage programs are programs in Phase 1 or Phase 2 development.

Research and discovery represents costs incurred to support our discovery research and translational science efforts.

Costs are reflected in the development stage based upon the program status when incurred.

Therefore, the same program could be reflected in different development stages in the same year.

For several of our programs, the research and development activities are part of our collaborative and other relationships.

Our costs reflect our share of the total costs incurred.

For 2022 compared to 2021, the decrease in research and development expense was primarily due to higher milestone payments in 2021, partially offset by the advancement of BIIB059 (anti-BDCA2) for the potential treatment of SLE and CLE, the development of LUNSUMIO, a a bispecific antibody for the treatment of relapsed or refractory follicular lymphoma, the development of BIIB124 (SAGE-324) for the potential treatment of essential tremor, which we are developing in collaboration with Sage, the development of BIIB122 (DNL151) for the potential treatment of Parkinson's disease, which we are developing in collaboration with Denali, and the development of BIIB800, a proposed tocilizumab biosimilar referencing ACTEMRA.

Excluding upfront payments, we expect our core research and development expense to modestly increase in 2023, as we continue to invest in our pipeline.

We intend to continue committing significant resources to targeted research and development opportunities where there is a significant unmet need and where a drug candidate has the potential to be highly differentiated.

Research and development expense, as a percentage of total revenue, was 25.0%, 21.9% and 22.8% for the years ended December 31, 2023, 2022 and 2021, respectively.

For 2023 compared to 2022, the increase in research and development was primarily due to approximately $197.0 million of equity-based compensation expense incurred as a result of our acquisition of Reata in 2023, an increase in spending for the development of LEQEMBI for the treatment of Alzheimer's disease, litifilimab for the treatment of CLE and SLE, and TOFIDENCE, a tocilizumab biosimilar referencing ACTEMRA, as well as clinical trial close out costs incurred in 2023 of approximately $125.4 million.

EARLY STAGE PROGRAMS

The increase in early stage programs was driven by an increase in costs associated with:

• development of BIIB121 for the treatment of Angelman syndrome;

• development of litifilimab for the treatment of CLE;

• development of BIIB115 for the treatment of SMA;

• development of BIIB091 for the treatment of MS;

• development of BIIB080 for the treatment of Alzheimer's disease.

The increase was partially offset by a decrease in costs associated with:

• discontinuation of BIIB104 for the treatment of cognitive impairment associated with schizophrenia;

• discontinuation of BIIB078 for the treatment of Alzheimer's disease.

LATE STAGE PROGRAMS

The decrease in late stage programs was driven by a decrease in costs associated with:

• advancement of LEQEMBI from late stage to marketed upon the accelerated approval of LEQEMBI in the U.S.;

• advancement of ZURZUVAE from late stage to marketed upon the approval of ZURZUVAE for PPD in the U.S.;

• advancement of QALSODY from late stage to marketed upon the accelerated approval of QALSODY in the U.S.;

• advancement of LUNSUMIO from late stage to marketed upon the accelerated approval of LUNSUMIO in the U.S.

The decrease was partially offset by an increase in costs associated with:

• development of litifilimab for the treatment of SLE into late stage;

• development of TOFIDENCE, a tocilizumab biosimilar referencing ACTEMRA.

MARKETED PROGRAMS

The increase in marketed programs was driven by an increase in costs associated with:

• advancement of LEQEMBI from late stage to marketed upon the accelerated approval of LEQEMBI in the U.S.;

• increased spend in ADUHELM primarily due to the change in our cost sharing arrangement with Eisai and clinical trial close out costs of approximately $103.0 million from the termination of our EMBARK and ENVISION studies;

• advancement of ZURZUVAE from late stage to marketed upon the approval of ZURZUVAE for PPD in the U.S.;

• increased spend in SKYCLARYS as a result of our acquisition of Reata in September 2023;

• advancement of QALSODY from late stage to marketed upon the accelerated approval of QALSODY in the U.S.

T able of Contents

MILESTONE AND UPFRONT EXPENSE

Research and development expense for 2023 includes:

• $37.0 million in charges to research and development expense in connection with milestone payments to Ionis;

• $15.0 million charge to research and development expense in connection with the upfront payment associated with entering into our collaboration with Alectos in the second quarter of 2022;

• $10.0 million charge to research and development expense in connection with the upfront payment associated with entering into

Table of Conten ts

our collaboration with Alcyone in the fourth quarter of 2022.

• $7.5 million charge to research and development expense in connection with a milestone payment to Ionis;

• $5.0 million charge to research and development expense in connection with exercising our option with Denali to license the ATV-enabled anti-amyloid beta program.

Research and development expense for 2022 includes:

• $125.0 million charge to research and development expense in connection with the upfront payment associated with entering into our collaboration with InnoCare in the third quarter of 2021;

• $60.0 million charge to research and development expense upon the exercise of our option under our collaboration agreement with Ionis to develop and commercialize BIIB115, an investigational ASO in development for SMA;

• $30.0 million charge to research and development expense related to the option exercise fee payable to Genentech to jointly develop and commercialize LUNSUMIO;

• $30.0 million charge to research and development expense in connection with the upfront payment associated with entering into a commercialization and license agreement with Bio-Thera to develop, manufacture and commercialize BIIB800.

The upfront payments associated with these collaborations are classified as research and development expense as the programs they relate to had not achieved regulatory approval as of the payment date.

For additional information about these collaboration arrangements, please read Note 19, Collaborative and Other Relationships, to our consolidated financial statements included in this report.

• $37.0 million in charges to research and development expense in connection with milestone payments to Ionis;

• $15.0 million charge to research and development expense in connection with the upfront payment associated with entering into our collaboration with Alectos Therapeutics Inc.

in the second quarter of 2022;

• $10.0 million charge to research and development expense in connection with the upfront payment associated with entering into our collaboration with Alcyone Therapeutics in the fourth quarter of 2022.

Research and development expense is reported above based on the following classifications.

The development stage reported is based upon the program status when incurred.

Therefore, the same program could be reflected in different development stages in the same year.

• Research and discovery:

represents costs incurred to support our discovery research and translational science efforts.

• Early stage programs:

For 2022 compared to 2021, the decrease in spending related to our early stage programs was primarily due to a decrease in costs associated with:

• the discontinuation of cinpanemab (BIIB054) in Parkinson's disease;

• the discontinuation of gosuranemab (BIIB092) in Alzheimer's disease;

• the discontinuation of cotoretigene toliparvovec (BIIB112) in X-linked retinitis pigmentosa;

• the advancement of litifilimab (BIIB059) for the potential treatment of SLE into late stage;

• the advancement of BIIB122 for the potential treatment of Parkinson's disease into late stage;

• the discontinuation of vixotrigine (BIIB074) in TGN and DPN;

• the discontinuation of BIIB078 for the potential treatment of Alzheimer's disease.

The decrease was partially offset by an increase in costs associated with:

• an increase in spending in the development of BIIB124 for the potential treatment of essential tremor;

• an increase in spending in the development of litifilimab (BIIB059) for the potential treatment of CLE;

• an increase in spending in the development of BIIB113 for the potential treatment of Alzheimer's disease;

• an increase in spending in the development of BIIB131 for the potential treatment of acute ischemic stroke;

• an increase in spending in the development of BIIB121 for the potential treatment of Angelman syndrome.

are programs in Phase 1 or Phase 2 development.

• Late stage programs:

For 2022 compared to 2021, the decrease in spending associated with our late stage programs was primarily due to a decrease in costs associated with:

• the advancement of ADUHELM from late stage to marketed upon the accelerated approval of ADUHELM in the U.S.;

• the discontinuation of BIIB111 in choroideremia.

The decrease was partially offset by an increase in costs associated with:

• the advancement of litifilimab (BIIB059) for the potential treatment of SLE into late stage;

• the advancement of BIIB122 for the potential treatment of Parkinson's disease into late stage;

• the advancement of BIIB800, a proposed tocilizumab biosimilar referencing ACTEMRA, into late stage.

Marketed Programs

For 2022 compared to 2021, the increase in spending associated with our marketed programs was primarily due to an increase in costs associated with:

• the advancement of ADUHELM from late stage to marketed upon the accelerated approval of ADUHELM in the U.S.;

• the advancement of LUNSUMIO from late stage to marketed upon the accelerated approval of LUNSUMIO in the U.S.

Table of Conten ts

Other Research and Development

In March 2019 Eisai initiated a global Phase 3 trial for the development of LEQEMBI in early Alzheimer's disease.

Under our collaboration arrangement, Eisai serves as the lead of LEQEMBI development and regulatory submissions globally with both companies co-commercializing and co-promoting the product, and Eisai having final decision-making authority.

All costs, including research, development, sales and marketing expense, are shared equally between us and Eisai.

In January 2023 the FDA granted accelerated approval of LEQEMBI.

Additionally, in January 2023 Eisai completed the submission of a supplemental BLA to the FDA for approval under the traditional pathway for LEQEMBI.

As of December 31, 2022, we had approximately $89.8 million of work-in-process inventory related to LEQEMBI.

For additional information on our collaboration arrangements with Eisai, please read Note 19, Collaborative and Other Relationships, to our consolidated financial statements included in this report.

are programs in Phase 3 development or in registration stage.

• Marketed products:

includes costs associated with product lifecycle management activities including, if applicable, costs associated with the development of new indications for existing products.

• Other research and development costs:

These costs are considered other research and development costs in the table above and are not allocated to a specific program or stage.

For several of our programs, the research and development activities are part of our collaborative and other relationships.

Our costs reflect our share of the total costs incurred.

For the year ended December 31, 2023, other research and development costs also includes approximately $197.0 million of equity-based compensation expense incurred as a result of our acquisition of Reata in September 2023.

Excluding any milestone and upfront payments, we expect our core research and development expense to decrease in 2024, while continuing to invest in our pipeline.

This is primarily due to the continued realization of our cost savings initiatives and the one-time costs incurred from our acquisition of Reata in September 2023 of approximately $197.0 million.

For additional information on our acquisition of Reata, please read Note 2, Acquisitions , to our consolidated financial statements included in this report.

T able of Contents

SELLING, GENERAL AND ADMINISTRATIVE

For 2022 compared to 2021, the decrease in selling, general and administrative expense was primarily due to cost-reduction measures realized during 2022.

As a result of the final NCD we have substantially eliminated our commercial infrastructure supporting ADUHELM, retaining minimal resources to manage patient access programs, including a continued free drug program for patients currently on treatment in the U.S.

Beginning in the second quarter of 2021 reimbursement from Eisai for its share of U.S.

ADUHELM selling, general and administrative expense is recognized in collaboration profit (loss) sharing in our consolidated statements of income.

We expect selling, general and administrative costs to continue to decline in 2023 due to the implementation of our cost saving initiatives during 2022, which include the substantial elimination of our commercial infrastructure supporting ADUHELM as well as other cost-reduction measures.

For 2023 compared to 2022, selling, general and administrative expense increased by approximately 6.1% primarily due to the recognition of approximately $196.4 million in equity-based compensation expense related to our acquisition of Reata in September 2023.

Additionally, we incurred transaction and integration-related expense of approximately $34.6 million related to this acquisition.

The increase in selling, general and administrative expense was also due to a $31.0 million obligation to Eisai related to the termination of the co-promotion agreement for our MS products in Japan during 2023 and approximately $11.5 million of accelerated depreciation, associated with exiting a leased property, recognized during the second quarter of 2023.

The increases were partially offset by the impact of cost-reduction measures realized during 2023.

We expect selling, general and administrative costs to continue to decline in 2024 due to the continued realization of our cost savings initiatives and the one-time costs incurred from our acquisition of Reata in 2023 of approximately $196.4 million.

For additional information on our acquisition of Reata, please read Note 2, Acquisitions , to our consolidated financial statements included in this report.

For additional information on our collaboration arrangements with Eisai, please read Note 19, Collaborative and Other Relationships, to our consolidated financial statements included in this report.

AMORTIZATION AND IMPAIRMENT OF ACQUIRED INTANGIBLE ASSETS

Our amortization expense is based on the economic consumption and impairment of intangible assets.

Our most significant amortizable intangible assets are related to our TYSABRI, AVONEX, SPINRAZA, VUMERITY and TECFIDERA (rest of world) products and other programs acquired through business combinations.

For 2022 compared to 2021, the decrease in amortization and impairment of acquired intangible assets was primarily due to higher impairment charges in 2021 of approximately $629.3 million, compared to impairment charges of approximately $119.6 million in 2022.

For the year ended December 31, 2022, amortization and impairment of acquired intangible assets reflects the impact of a $119.6 million impairment charge related to vixotrigi ne for the potential treatment of DPN.

For the year ended December 31, 2021, amortization and impairment of acquired intangible assets reflects the impact of a $365.0 million impairment charge related to BIIB111, a $220.0 million impairment charge related to BIIB112 and a $44.3 million impairment charge related to vixotrigine for the potential treatment of TGN.

Table of Conten ts

Our most significant amortizable intangible assets are related to TYSABRI, AVONEX, SPINRAZA, VUMERITY and SKYCLARYS, which was obtained as part of our acquisition of Reata in September 2023.

For additional information on our acquisition of Reata, please read Note 2, Acquisitions , to our consolidated financial statements included in this report.

For 2023 compared to 2022, the decrease i n amortization and impairment of acquired intangible assets was primarily due to higher impairment charges in 2022 of approximately $119.6 million, compared to no impairment charges in 2023.

For the year ended December 31, 2022 , amortization and impairment of acquired intangible assets reflects the impact of a $119.6 million impairment charge related to vixotrigi ne (BIIB074) for the potential treatment of DPN.

Amortization of acquired intangible assets, excluding impairment charges, totaled $240.6 million, $246.3 million and $252.0 million for the years ended December 31, 2023, 2022 and 2021, respectively.

We monitor events and expectations regarding product performance.

If new information indicates that the assumptions underlying our most recent analysis are substantially different than those utilized in our current estimates, our analysis would be updated and may result in a significant change in the anticipated lifetime revenue of the relevant products.

The occurrence of an adverse event could substantially increase the amount of amortization expense related to our acquired intangible assets as compared to previous periods or our current expectations, which may result in a significant negative impact on our future results of operations.

IPR&D Related to Business Combinations

IPR&D represents the fair value assigned to research and development assets that we acquired as part of a business combination and had not yet reached technological feasibility at the date of acquisition.

We review amounts capitalized as acquired IPR&D for impairment annually, as of October 31, and whenever events or changes in circumstances indicate to us that the carrying value of the assets might not be recoverable.

Overall, the value of our acquired IPR&D assets is dependent upon several variables, including estimates of future revenue and the effects of competition, our ability to secure sufficient pricing in a competitive market, our ability to confirm safety and efficacy based on data from clinical trials and regulatory feedback, the level of anticipated development costs and the probability and timing of successfully advancing a particular research program from one clinical trial phase to the next.

We are continually reevaluating our estimates concerning these and other variables, including our life cycle management strategies, research and development priorities and development risk, changes in program and portfolio economics and related impact of foreign currency exchange rates and economic trends and evaluating industry and company data regarding the productivity of clinical research and the development process.

Changes in our estimates may result in a significant change to our valuation of our IPR&D assets.

In the periods following our acquisition of vixotrigine, there were numerous delays in the initiation of Phase 3 studies for the potential treatment of TGN and for the potential t reatment of DPN, another form of neuropathic pain.

We engaged with the FDA regarding the design of the potential Phase 3 studies of vixotrigine for the potential treatment of TGN and DPN and performed an additional clinical trial of vixotrigine, which was completed during 2022.

The performance of this additional clinical trial delayed the initiation of the Phase 3 studies of vixotrigine for the potential treatment of TGN, and, as a result, we recognized an impairment charge of $44.3 million related to vixotrigine for the potential treatment of TGN during the first quarter of 2021.

During the fourth quarter of 2022 we discontinued further development of vixotrigine based on regulatory, development and commercialization challenges.

For the year ended December 31, 2022, we recognized an impairment charge of approximately $119.6 million related to vixotrigine for the potential treatment of DPN, reducing the remaining book value of this IPR&D intangible asset to zero.

We also adjusted the value of our contingent consideration obligations related to this asset resulting in a pre-tax gain of approximately $209.1 million, which was recognized in (gain) loss on fair value remeasurement of contingent consideration within our consolidated statements of income.

BIIB111 and BIIB112

During the second quarter of 2021 we announced that our Phase 3 STAR study of BIIB111 and our Phase 2/3 XIRIUS study of BIIB112 did not meet their primary endpoints.

In the third quarter of 2021 we suspended further development on these programs based on the decision by management as part of its strategic review process.

For the year ended December 31, 2021, we recognized an impairment charge of $365.0 million related to BIIB111 and an impairment charge of $220.0 million related to BIIB112, reducing the remaining book values of these IPR&D intangible assets to zero.

In addition, as a result of our decision to suspend further development of BIIB111 and BIIB112, we recorded charges of approximately $39.1 million during the third quarter of 2021 related to our manufacturing arrangements and other costs that we expect to incur as a result of suspending these programs.

These charges were recognized in research and development expense in our consolidated statements of income for the year ended December 31, 2021.

Table of Conten ts

The decrease in amortization of acquired intangible assets, excluding impairment charges, over the three years was primarily due to a lower rate of amortization for acquired intangible assets.

For additional information on the amortization and impairment of our acquired intangible assets, please read Note 7, Intangible Assets and Goodwill , to our consolidated financial statements included in this report.

Collaboration Profit (Loss) Sharing

Collaboration profit (loss) sharing primarily includes Samsung Bioepis' 50.0% share of the profit or loss related to our biosimilars 2013 commercial agreement with Samsung Bioepis and, beginning in the second quarter of 2021, Eisai's 45.0% share of income and expense in the U.S.

COLLABORATION PROFIT SHARING/(LOSS REIMBURSEMENT)

Collaboration profit sharing/(loss reimbursement) primarily includes Samsung Bioepis' 50.0% share of the profit or loss related to our biosimilars 2013 commercial agreement with Samsung Bioepis.

In the third quarter of 2023 we began recognizing collaboration profit sharing/(loss reimbursement) related to Sage's 50.0% share of income and expense in the U.S.

related to ZURZUVAE for PPD.

During 2022 we recognized Eisai's 45.0% share of income and expense in the U.S.

related to the ADUHELM Collaboration Agreement.

1 unchanged sentence

For the years ended December 31, 2023 and 2022, we recognized net profit-sharing expense of $223.5 million and $217.4 million, respectively, to reflect Samsung Bioepis' 50.0% sharing of the net collaboration profits.

For the years ended December 31, 2022 and 2021 we recognized net reductions to our operating expense of approximately $224.7 million and $233.2 million, respectively, to reflect Eisai's 45.0% share of net collaboration losses in the U.S.

For the year ended December 31, 2021, we also recognized net reductions to our operating expense of $45.0 million to reflect Eisai's 45.0% share of the $100.0 million milestone payment made to Neurimmune related to the launch of ADUHELM in the U.S.

during the second quarter of 2021.

For additional information on our collaboration arrangements with Samsung Bioepis and Eisai, please read Note 19, Collaborative and Other Relationships , to our consolidated financial statements included in this report.

For the year ended December 31, 2023, we recognized net reductions to our operating expense of approximately $4.7 million to reflect Sage's 50.0% share of net collaboration losses in the U.S.

For the year ended December 31, 2022, we recognized net reductions to our operating expense of approximately $224.7 million to reflect Eisai's 45.0% share of net collaboration losses in the U.S.

For additional information on our collaboration and license arrangements with Samsung Bioepis, Sage and Eisai, please read Note 19, Collaborative and Other Relationships, to our consolidated financial statements included in this report.

T able of Contents

(GAIN) LOSS ON FAIR VALUE REMEASUREMENT OF CONTINGENT CONSIDERATION

For the year ended December 31, 2022, the changes in fair value of our contingent consideration obligations were primarily due to the discontinuation of further development efforts related to vixotrigine for the potential treatment of TGN and DPN, resulting in a reduction of our contingent consideration obligations of approximatel y $195.4 million, and changes in the interest rates used to revalue our contingent consideration liabilities.

For the year ended December 31, 2021, the changes in fair value of our contingent consideration obligations were primarily due to reductions in the probability of technical and regulatory success and delays in the expected timing of the achievement of certain remaining developmental milestones related to our vixotrigine programs.

For the year ended December 31, 2022, the changes in fair value of our contingent consideration obligations were primarily due to the discontinuation of further development efforts related to vixotrigine for the potential treatment of TGN and DPN, resulting in a reduction of our contingent consideration obligations of approximatel y $195.4 million, reducing the remaining fair value of vixotrigine to zero, as well as changes in the interest rates used to revalue our contingent consideration liabilities.

For additional information on our IPR&D intangible assets, please read Note 7, Intangible Assets and Goodwill , to our consolidated financial statements included in this report.

Table of Conten ts

RESTRUCTURING CHARGES

2023 FIT FOR GROWTH RESTRUCTURING PROGRAM

In 2023 we initiated additional cost saving measures as part of our Fit for Growth program to reduce operating costs, while improving operating efficiency and effectiveness.

Total charges incurred from our 2023 cost saving initiatives are summarized as follows:

For the Years Ended December 31,

(In millions) Severance

Costs Accelerated Depreciation and Other Costs Total

Selling, general and administrative $ — $ 23.3 $ 23.3

Research and development — 1.2 1.2

Restructuring charges 153.4 34.6 188.0

Total charges $ 153.4 $ 59.1 $ 212.5

includes costs associated with items such as asset abandonment and write-offs, facility closure costs, pretax gains and losses resulting from the termination of certain leases, employee non-severance expense, consulting fees and other costs.

REATA INTEGRATION

Following the close of our Reata acquisition, we implemented an integration plan designed to realize operating synergies through cost savings and avoidance.

These amounts are primarily related to severance and are expected to be paid by the end of 2024.

For the year ended December 31, 2023, we recognized approximately $30.4 million of net pre-tax restructuring charges related to employee severance costs.

2022 COST SAVING INITIATIVES

In December 2021 and May 2022 we announced our plans to implement a series of cost-reduction measures that when completed we expect may yield approximately $1.0 billion in expense savings.

Under these initiatives, we estimate we will incur total restructuring charges of approximately $131.0 million, primarily related to severance.

These amounts were substantially incurred during 2022.

As of December 31, 2022, approximately $35.9 million remained in our restructuring reserve and payments are expected to be made through 2026.

For the year ended December 31, 2022, we recognized approximately $131.1 million of net pre-tax restructuring charges related to our 2022 cost saving initiatives, of which approximately $112.6 million consisted of employee severance costs.

Our restructuring reserve is included in accrued expense and other in our consolidated balance sheets.

In September 2022 we entered into an agreement to partially terminate a portion of our lease located at 300 Binney Street, as well as to reduce the lease term for the majority of the remaining space.

This resulted in a gain of approximately $5.3 million, which was recorded within restructuring charges in our consolidated statements of income for the year ended December 31, 2022 .

For additional information on our 300 Binney Street lease modification, please read

Note 12, Leases , to these consolidated financial statements included in this report.

Following an evaluation of our current capacity needs, in March 2022 we ceased using a patient services office space in Durham, NC.

Our decision to cease use of the facility resulted in the immediate expense of certain leasehold improvements and other assets at this facility.

As a result, we recognized approximately $10.4 million of accelerated depreciation expense, which was recorded in restructuring charges in our consolidated statements of income for the year ended December 31, 2022 .

In May 2022 we entered into a lease assignment agreement whereby we assigned our remaining lease obligations to an external third party.

As a result of the lease assignment, we derecognized the related operating lease obligation and right-of-use asset during the second quarter of 2022.

For the year ended December 31, 2022, we recognized other restructuring costs of approximately $13.2 million, which were recorded in restructuring charges in our consolidated statements of income.

Other restructuring costs include items such as facility closure costs, employee non-severance expense, asset write-offs and other costs.

The following table summarizes the charges and spending related to our 2022 workforce reductions for the year ended December 31, 2022 :

(In millions) Total

Restructuring reserve, December 31, 2021 $ —

Expense 112.6

Payment (78.0)

Foreign currency and other adjustments 1.3

Restructuring reserve, December 31, 2022 $ 35.9

Table of Conten ts

In December 2021 and May 2022 we announced our plans to implement a series of cost-reduction measures during 2022.

These savings are being achieved through a number of initiatives, including reductions to our workforce, the substantial elimination of our commercial ADUHELM infrastructure, deprioritization of certain research and development programs, the consolidation of certain real estate locations and operating efficiencies across our selling, general and administrative and research and development functions.

Charges related to our 2022 cost saving initiatives were substantially incurred during 2022 with remaining payments expected to be made through 2026.

T able of Contents

Total charges incurred from our 2022 cost saving initiatives are summarized as follows:

For the Years Ended December 31,

(In millions) Severance

Costs Accelerated Depreciation and Other Costs Total Severance Costs Accumulated Depreciation and Other Costs (1)

Restructuring charges $ (2.2) $ 2.6 $ 0.4 $ 112.6 $ 18.5 $ 131.1

Total charges $ (2.2) $ 2.6 $ 0.4 $ 112.6 $ 18.5 $ 131.1

(1) Amounts reflect a gain recorded during the third quarter of 2022 of approximately $5.3 million related to the partial termination of a portion of our lease located at 300 Binney Street.

For additional information on our 300 Binney Street lease modification, please read Note 12, Leases , to these consolidated financial statements.

For additional information on our cost saving initiatives, please read Note 4, Restructuring, to our consolidated financial statements included in this report.

GAIN ON SALE OF BUILDING

This sale resulted in a pre-tax gain on sale of approximately $503.7 million, net of transaction costs, for the year ended December 31, 2022.

Simultaneously, with the close of this transaction we leased back the building for a term of approximately 5.5 years, which resulted in the recognition of approximately $168.2 million in new lease liabilities and right-of-use assets recorded within our consolidated balance sheets as of December 31, 2022.

This sale resulted in a pre-tax gain on sale of approximately $503.7 million, net of transaction costs, which is reflected within gain on sale of building in our consolidated statements of income for the year ended December 31, 2022.

Simultaneously, with the close of this transaction we leased back the building for a term of approximately 5.5 years, which resulted in the recognition of approximately $168.2 million in a new lease liability and right-of-use asset recorded within our consolidated balance sheets as of December 31, 2022.

The sale and immediate leaseback of this building qualified for sale and leaseback treatment and is classified as an operating lease.

1 unchanged sentence

OTHER (INCOME) EXPENSE, NET

For 2022 compared to 2021, the change in other (income) expense, net primarily reflects a pre-tax gain during 2022 of approximately $1.5 billion related to the sale of our 49.9% equity interest in Samsung Bioepis, partially offset by a pre-tax charge of $900.0 million, plus settlement fees and expenses, related to a litigation settlement agreement to resolve a qui tam litigation relating to conduct prior to 2015.

For the year ended December 31, 2022, net unrealized losses and realized (gains) losses on our holdings in equity securities were approximately $264.7 million and zero, respectively, compared to net unrealized losses and realized gains of $831.4 million and $10.3 million, respectively, in 2021.

The net unrealized losses recognized during the year ended December 31, 2022, primarily reflect a decrease in the aggregate fair value of our investments in Denali and Sangamo common stock of approximately $278.0 million.

The net unrealized losses recognized during the year ended December 31, 2021, primarily reflect decreases in the aggregate fair value of our investments in Denali, Sage, Sangamo and Ionis common stock of approximately $819.6 million.

For the year ended December 31, 2022, net interest expense was $157.3 million, compared to $242.6 million in 2021.

This decrease was primarily due to higher interest income earned on our investments in 2022, compared to 2021, and lower interest expense in 2022 due to the redemption of our 3.625% Senior Notes due September 15, 2022, with an aggregate principal amount of $1.0 billion.

For 2023 compared to 2022, we anticipate a decrease in net interest expense as a result of lower average debt balances in 2023 and an increase in

Table of Conten ts

interest income driven by higher interest rates on our cash and marketable securities.

For 2023 compared to 2022, the change in other (income) expense, net primarily reflects a pre-tax gain recorded during 2022 of approximately $1.5 billion related to the sale of our 49.9% equity interest in Samsung Bioepis, partially offset by a pre-tax charge recorded during 2022 of approximately $900.0 million, plus settlement fees and expenses, related to a litigation settlement agreement to resolve a qui tam litigation relating to conduct prior to 2015.

Additionally, other (income) expense, net for 2023 reflects higher interest income driven by higher interest rates in 2023.

NET (GAINS) LOSSES IN EQUITY SECURITIES

For the year ended December 31, 2023, net unrealized and realized losses on our holdings in equity securities were approximately $270.0 million and $5.2 million, respectively, compared to net unrealized losses and realized (gains) losses of approximately $264.7 million and zero, respectively, in 2022.

• The net unrealized losses recognized during the year ended December 31, 2023, primarily reflect a decrease in the aggregate fair value of our investments in Sage, Denali, Sangamo and Ionis common stock of approximately $248.5 million.

• The net unrealized losses recognized during the year ended December 31, 2022, primarily reflect a decrease in the aggregate fair value of our investments in Denali and Sangamo common stock of approximately $278.0 million, partially offset by an increase in the fair value of Ionis and Sage common stock of approximately $27.3 million.

INTEREST INCOME AND EXPENSE

For the year ended December 31, 2023, net interest income was $29.6 million, compared to net interest expense of $157.3 million in 2022.

The increase was primarily due to higher interest rates leading to greater interest income earned on our investments in 2023, compared to 2022.

For 2024 compared to 2023, we anticipate an increase in net interest expense as a result of lower cash balances leading to lower interest income due to the funding of our acquisition of Reata.

For additional information on the sale of our equity interest in Samsung Bioepis, please read Note 3, Dispositions , to our consolidated financial statements included in this report.

For additional information on the redemption of our Senior Notes, please read Note 13, Indebtedness , to our consolidated financial statements included in this report.

T able of Contents

For additional information on the litigation settlement agreement, please read Note 18, Other Consolidated Financial Statement Detail , to our consolidated financial statements included in this report.

INCOME TAX PROVISION

For the Years Ended December 31,

(In millions, except percentages) 2023 2022 2021

Income before income tax (benefit) expense $ 1,296.8 $ 3,591.8 $ 1,745.2

Income tax (benefit) expense 135.3 632.8 52.5

Effective tax rate 10.4 % 17.6 % 3.0 %

Our effective tax rate fluctuates from year to year due to the global nature of our operations.

The factors that most significantly impact our effective tax rate include changes in tax laws, variability in the allocation of our taxable earnings among multiple jurisdictions, the amount and characterization of our research and development expense, the levels of

certain deductions and credits, acquisitions and licensing transactions.

For the year ended December 31, 2022, compared to 2021, the increase in our effective tax rate, excluding the impact of the net Neurimmune deferred tax asset, as discussed below, includes the tax impacts of the litigation settlement agreement and the sale of our building at 125 Broadway.

These increases were partially offset by the impact of the current year tax benefits related to an international reorganization to align with global tax developments, the impacts of the sale of our equity interest in Samsung Bioepis and the tax impacts of the decision to discontinue development of vixotrigine.

Further in 2021, our effective tax rate benefited from the tax effects of the BIIB111 and BIIB112 impairment charges and the non-cash tax effects of changes in the value of our equity instruments.

For 2023 compared to 2022, the decrease in our effective tax rate was driven by the impact of the non-cash changes in the value of our equity investments, the impact of Fit for Growth related expenses and Reata acquisition-related expenses, as well as the combined net unfavorable tax rate impacts in 2022 related to a litigation settlement agreement, the sale of our equity interest in Samsung Bioepis, the impact of a Neurimmune valuation allowance and an international reorganization to align with global tax developments.

The change also benefits from the resolution of an uncertain tax matter during the first quarter of 2023 related to tax credits.

For additional information on our acquisition of Reata, please read Note 2, Acquisitions , to our consolidated financial statements included in this report.

Neurimmune Deferred Tax Asset

During 2021 we recorded a net deferred tax asset in Switzerland of approximately $100.0 million on Neurimmune's tax basis in ADUHELM, the realization of which was dependent on future sales of ADUHELM.

During the first quarter of 2022, upon issuance of the final NCD related to ADUHELM, we recorded an increase in a valuation allowance of approximately $85.0 million to reduce the net value of this deferred tax asset to zero.

These adjustments to our net deferred tax asset are each recorded with an equal and offsetting amount assigned to net income (loss) attributable to noncontrolling interests, net of tax in our consolidated statements of income, resulting in a zero net impact to net income attributable to Biogen Inc.

For additional information on our collaboration arrangement with Neurimmune, please read Note 20, Investments in Variable Interest Entities , to our consolidated financial statements included in this report.

Inflation Reduction Act

In August 2022 the IRA was signed into law in the U.S.

The IRA introduced new tax provisions, including a 15.0% corporate alternative minimum tax and a 1.0% excise tax on stock repurchases.

The provisions of the IRA will be effective for periods after December 31, 2022.

The enactment of the IRA did not result in any material adjustments to our income

Table of Conten ts

tax provision or net deferred tax assets as of December 31, 2022.

For additional information on our income taxes, uncertain tax positions and income tax rate reconciliation, please read Note 17, Income Taxes , to our consolidated financial statements included in this report.

6 unchanged sentences

For the year ended December 31, 2022, we recognized net income on our investment of $2.6 million, reflecting our share of Samsung Bioepis' operating profits, net of tax, totaling $17.0 million offset by amortization of basis differences totaling $14.4 million.

This amount reflects our share of

results prior to the sale of Samsung Bioepis as the results are recognized one quarter in arrears.

For the year ended December 31, 2021, we recognized net income on our investment of $34.9 million, reflecting our share of Samsung Bioepis' operating profits, net of tax, totaling $64.6 million offset by amortization of basis differences totaling $29.7 million.

Net income on our investment for the year ended December 31, 2021, reflects a $31.2 million benefit related to the release of a valuation allowance on deferred tax assets associated with Samsung Bioepis.

The valuation allowance was released in the second quarter of 2021 based on a consideration of the positive and negative evidence, including the historic earnings of Samsung Bioepis.

This amount reflects our share of results prior to the sale of Samsung Bioepis as the results are recognized one quarter in arrears.

For additional information on the sale of our equity interest in Samsung Bioepis, please read Note 3, Dispositions , to our consolidated financial statements included in this report.

1 unchanged sentence

NONCONTROLLING INTERESTS, NET OF TAX

Our consolidated financial statements include the financial results of our variable interest entity, Neurimmune, as we determined that we are the primary beneficiary.

For 2022 compared to 2021, the change in net income (loss) attributable to noncontrolling interests, net of tax, was primarily due to a deferred tax benefit and milestone payment recorded in 2021, as discussed below.

Table of Conten ts

For 2021 the change in net income (loss) attributable to noncontrolling interests, net of tax, was also due to the $100.0 million milestone payment to Neurimmune related to the launch of ADUHELM in the U.S.

For additional information on our collaboration agreement with Neurimmune, please read Note 20, Investments in Variable Interest Entities, to our consolidated financial statements included in this report.

For additional information on our income taxes please read Note 17, Income Taxes , to our consolidated financial statements included in this report.

Table of Conten ts

Our consolidated financial statements include the financial results of a variable interest entity, Neurimmune, as we determined that we were the primary beneficiary.

In November 2023 we notified Neurimmune of our decision to terminate the Neurimmune Agreement.

Subsequent to the termination, we reconsidered our relationship with Neurimmune and determined that we were no longer the primary beneficiary of the variable interest entity.

As a result, we recorded a net gain on the deconsolidation of

T able of Contents

Neurimmune of approximately $3.0 million, which was recorded in other (income) expense, net within our consolidated statements of income for the year ended December 31, 2023.

For 2023 compared to 2022, the change in net income (loss) attributable to noncontrolling interests, net of tax, was primarily due to an increase in a valuation allowance of approximately $85.0 million recorded in the first quarter of 2022.

For additional information on the valuation allowance, deconsolidation and our collaboration agreement with Neurimmune, please read Note 20, Investments in Variable Interest Entities, to our consolidated financial statements included in this report.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

4 unchanged sentences

Cash and cash equivalents $ 1,049.9 $ 3,419.3 (69.3) % $ (2,369.4)

Marketable securities — current 1,473.5 1,541.1 (4.4) (67.6)

Marketable securities — non-current 705.7 892.0 (20.9) (186.3)

Marketable securities — current — 1,473.5 nm (1,473.5)

Marketable securities — non-current — 705.7 nm (705.7)

Total cash, cash equivalents and marketable securities $ 1,049.9 $ 5,598.5 (81.2) % $ (4,548.6)

Current portion of notes payable $ — $ 999.1 nm $ (999.1)

Notes payable 6,281.0 6,274.0 0.1 7.0

Current portion of term loan $ 150.0 $ — nm $ 150.0

Notes payable and term loan 6,788.2 6,281.0 8.1 507.2

Total borrowings $ 6,938.2 $ 6,281.0 10.5 % $ 657.2

5 unchanged sentences

We have historically financed and expect to continue to fund our operating and capital expenditures primarily through cash flow earned through our operations, as well as our existing cash resources.

We believe generic competition for TECFIDERA in the U.S.

and other key markets and the impact of biosimilar competition on RITUXAN sales volumes will continue to reduce our cash flow from operations in 2023 and will have a significant adverse impact on our future cash flow from operations.

For the year ended December 31, 2022, certain significant cash flows were as follows:

• $1,384.3 million in net cash flow provided by operating activities;

• $990.3 million in net proceeds received from the sale of our equity interest in Samsung Bioepis;

• $582.6 million in net proceeds received from the sale of one of our buildings;

• $1.0 billion payment made for the redemption of our 3.625% Senior Notes due September 15, 2022;

• $917.0 million in total net payments for a litigation settlement agreement and settlement fees and expenses;

• $932.9 million in total net payments for income taxes;

• $750.0 million used for share repurchases;

• $240.3 million used for purchases of property, plant and equipment.

For the year ended December 31, 2021, certain significant cash flows were as follows:

• $3,639.9 million in net cash flow provided by operating activities;

• $1.8 billion used for share repurchases;

• $170.0 million used in connection with our private offer to exchange (Exchange Offer) our tendered 5.200% Senior Notes due September 15, 2045 (2045 Senior Notes) for a new series of 3.250% Senior Notes due February 15, 2051 (2051 Senior Notes) and cash, and an offer to purchase our tendered 2045 Senior Notes for cash;

• $258.1 million used for purchases of property, plant and equipment;

• $247.9 million in total net payments for income taxes;

• $100.0 million milestone payment to Neurimmune.

We believe that generic and biosimilar competition for many of our key products, the continued overall decline of our MS business and our investments in the launch of key new products and the development of our pipeline will have a significant adverse impact on our future cash flow from operations.

We believe that our existing funds, when combined with cash generated from operations and our access to additional financing resources, if needed, are sufficient to satisfy our operating, working capital, strategic alliance, milestone payment, capital expenditure and debt service requirements for the foreseeable future.

In addition, we may choose to opportunistically return cash to shareholders and pursue other business initiatives, including acquisition and licensing activities.

We may, from time to time, also seek additional funding through a combination of new collaborative agreements, strategic alliances and additional equity and debt financings or from other

Table of Conten ts

sources should we identify a significant new opportunity .

We may also seek additional funding through a combination of new collaborative agreements, strategic alliances and additional equity and debt financings or from other sources should we identify a significant new opportunity.

On September 26, 2023 , we completed the acquisition of all of the issued and outstanding shares of Reata for $6.6 billion and $983.9 million for outstanding equity awards.

This transaction was funded with cash on hand and the issuance of a $1.0 billion term loan.

Additionally, we paid approximately $459.9 million to settle outstanding debt obligations acquired as part of our acquisition of Reata.

For additional information on our acquisition of Reata, please read Note 2, Acquisitions , to our consolidated financial statements included in this report.

T able of Contents

For additional information on certain risks that could negatively impact our financial position or future results of operations, please read Item 1A.

R isk Factors and Item 7A.

Risk Factors and Item 7A.

Quantitative and Qualitative Disclosures About Market Risk included in this report.

WORKING CAPITAL

Working capital is defined as current assets less current liabilities.

Our working capital was $3.4 billion as of December 31, 2023, compared to $6.5 billion as of December 31, 2022.

The change in working capital reflects a decrease in total current assets of approximately $2,931.9 million and an increase in total current liabilities of approximately $161.5 million.

The changes in total current assets and total current liabilities were primarily driven by the following:

CURRENT ASSETS

• $3,842.9 million decrease in cash, cash equivalents and current marketable securities primarily due to consideration paid for our acquisition of Reata as well as the early repayment of $350.0 million in outstanding debt obligations associated with our Reata acquisition ;

• $235.6 million decrease in other current assets primarily due to the receipt of $812.5 million from Samsung BioLogics related to the sale of Samsung Bioepis, partially offset by the final deferred payment of $437.5 million now due within one year;

• $1,183.0 million increase in inventory primarily due to the fair value step-up adjustment for acquired inventory from our acquisition of Reata.

CURRENT LIABILITIES

• $88.2 million decrease in accounts payable primarily due to timing of payments;

• $102.2 million increase in accrued expense and other primarily reflecting accrued costs related to our acquisition of Reata;

• $150.0 million increase in current portion of debt due to the short-term portion of our outstanding 2023 Term Loan related to our acquisition of Reata.

For additional information on our acquisition of Reata, please read Note 2, Acquisitions , to our consolidated financial statements included in this report.

For additional information on our 2023 Term Loan, please read Note 13, Indebtedness , to our consolidated financial statements included in this report.

For additional information on the sale of our equity interest in Samsung Bioepis, please read Note 3, Dispositions , to our consolidated financial statements included in this report.

CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES

As of December 31, 2023, we had cash, cash equivalents and marketable securities totaling approximately $1.0 billion compared to approximately $5.6 billion as of December 31, 2022.

The decrease in the balance was primarily due to the use of cash, cash equivalents and marketable securities to fund our acquisition of Reata.

In connection with our acquisition of Reata we paid approximately $6.6 billion for the issued and outstanding shares of Reata and $983.9 million related to Reata's outstanding equity awards, inclusive of employer taxes.

Additionally, we assumed a payable to Blackstone of approximately $300.0 million related to a one-time contract termination fee to eliminate potential future royalty obligations related to SKYCLARYS, which was triggered as part of the change in control provision under Reata's funding agreement with Blackstone.

For additional information on our acquisition of Reata, please read Note 2, Acquisitions , to these consolidated financial statements included in this report.

Until required for another use in our business, we typically invest our cash reserves in bank deposits, certificates of deposit, commercial paper, corporate notes, U.S.

1 unchanged sentence

It is our policy to mitigate credit risk in our cash reserves and marketable securities by maintaining a well-diversified portfolio that limits the amount of exposure as to institution, maturity and investment type.

As of December 31, 2022, we had cash, cash equivalents and marketable securities totaling approximately $5.6 billion compared to approximately $4.7 billion as of December 31, 2021.

The change in cash, cash equivalents and marketable securities at December 31, 2022, from December 31, 2021, was primarily due to net cash flow provided by operating activities, which includes $917.0 million in total net payments for a litigation settlement agreement and settlement fees and expenses, and $990.3 million in net proceeds received from the sale of our equity interest in Samsung Bioepis and $582.6 million in net proceeds received from the sale of one of our buildings, partially offset by $1.0 billion of cash used for the redemption of our 3.625% Senior Notes due September 15, 2022 and $750.0 million used for share repurchases.

The following table summarizes the fair value of our significant common stock investments:

We have experienced no significant limitations in our liquidity resulting from uncertainties in the banking sector.

T able of Contents

The following table summarizes the fair value of our significant common stock investments in our strategic investment portfolio:

As of December 31,

(In millions) 2023 2022

Denali $ 370.2 $ 550.7

Sage 238.0 231.9

Sangamo 74.3 173.7

Ionis 108.6 87.5

$ 273.6 $ 370.2

Although the contractual holding period restrictions on our investments in Denali, Sage,

Sangamo and Ionis have expired, our ability to liquidate these investments may be limited by the size of our interest, the volume of market related activity, our concentrated level of ownership and potential restrictions resulting from our status as a collaborator.

Sage 135.3 238.0

Total $ 416.8 $ 791.1

(1) During 2023 we sold a portion of our Sangamo and Denali common stock.

(2) During 2023 we sold our remaining shares of Ionis common stock.

Our ability to liquidate our investments in Denali, Sage and Sangamo may be limited by the size of our interest, the volume of market related activity, our concentrated level of ownership and potential restrictions resulting from our status as a collaborator.

Therefore, we may realize significantly less than the current value of such investments.

For additional information on our collaboration arrangements, please read Note 19, Collaborative and Other Relationships, to our consolidated financial statements included in this report .

Investments and Other Assets

Investments and other assets in our consolidated balance sheet as of December 31, 2021, includes the carrying value of our investment in Samsung Bioepis of $599.9 million.

In April 2022 we completed the sale of our 49.9% equity interest in Samsung Bioepis to Samsung BioLogics.

As part of this transaction, we are also eligible to receive up to an additional $50.0 million upon the achievement of certain commercial milestones.

If any payments due to us remain outstanding after the second anniversary of the closing of this transaction, we may elect to receive shares of Samsung BioLogics common stock at a 5.0% discount in lieu of a cash payment for the remaining amount due.

Currently, we believe that the likelihood of Samsung BioLogics failing to make timely payments to us for the amounts due is remote.

For additional information on the sale of our equity interest in Samsung Bioepis, please read Note 3, Dispositions , to our consolidated financial statements included in this report.

Capital Expenditures

In March 2021 we announced our plans to build a new gene therapy manufacturing facility in RTP, NC to support our gene therapy pipeline across multiple therapeutic areas.

The new manufacturing facility will be approximately 197,000 square feet and is expected to be operational by the end of 2023, with an estimated total investment of approximately $195.0 million.

Construction for this new facility began during the fourth quarter of 2021.

Table of Conten ts

In February 2021 we completed our Exchange Offer, consisting of the following:

• $624.6 million aggregate principal amount of our 2045 Senior Notes was exchanged for $700.7 million aggregate principal amount of our 2051 Senior Notes and approximately $151.8 million of aggregate cash payments;

• $8.9 million aggregate principal amount of our 2045 Senior Notes was redeemed for approximately $12.1 million of aggregate cash payments, excluding accrued and unpaid interest.

The following is a summary of our currently outstanding senior unsecured notes issued in 2020 (2020 Senior Notes):

• $1.5 billion aggregate principal amount of 2.25% Senior Notes due May 1, 2030;

• $1.5 billion aggregate principal amount of 3.15% Senior Notes due May 1, 2050.

The following is a summary of our currently outstanding senior unsecured notes issued in 2015 (2015 Senior Notes):

• $1.75 billion aggregate principal amount of 4.05% Senior Notes due September 15, 2025;

• $1.12 billion aggregate principal amount of 5.20% Senior Notes due September 15, 2045.

Our 2020 Senior Notes and our 2015 Senior Notes were issued at a discount, which are amortized as additional interest expense over the period from issuance through maturity.

In July 2022 we redeemed our 3.625% Senior Notes due September 15, 2022, with an aggregate principal amount of $1.0 billion.

For additional information on our Senior Notes, please read Note 13, Indebtedness , to our consolidated financial statements included in this report.

For a summary of the fair values of our outstanding borrowings as of December 31, 2022 and 2021, please read Note 8, Fair Value Measurements, to our consolidated financial statements included in this report.

Credit Facility

In January 2020 we entered into a $1.0 billion, five-year senior unsecured revolving credit facility under which we are permitted to draw funds for working capital and general corporate purposes.

The terms of the revolving credit facility include a financial

covenant that requires us not to exceed a maximum consolidated leverage ratio.

As of December 31, 2022 and 2021, we had no outstanding borrowings and were in compliance with all covenants under this facility.

Working Capital

Working capital is defined as current assets less current liabilities.

Working capital was $6.5 billion and $3.6 billion as of December 31, 2022 and 2021, respectively.

The change in working capital reflects an increase in total current assets of approximately $1.9 billion and a decrease in total current liabilities of approximately $1.0 billion.

Current Assets

The increase in total current assets was primarily driven by the following:

• net increase in cash, cash equivalents and marketable securities due to net cash flow provided by operating activities of approximately $1,384.3 million;

• receipt of approximately $990.3 million in cash, net of expenses, from the sale of our equity interest in Samsung Bioepis;

• recording of a receivable from Samsung BioLogics for approximately $798.8 million as part of the sale of our equity interest in Samsung Bioepis;

• cash receipt of approximately $582.6 million related to the sale of one of our buildings.

The increase was partially offset by cash used for the redemption of our 3.625% Senior Notes due September 15, 2022, of approximately $1.0 billion and share repurchases of $750.0 million and $917.0 million in total net payments for a litigation settlement agreement and settlement fees and expenses.

Current Liabilities

The decrease in total current liabilities was primarily due to the following:

• redemption of our 3.625% Senior Notes due September 15, 2022, of approximately $1.0 billion, which were classified within current liabilities in 2021;

• a reduction in our accounts payable.

Share Repurchase Programs

In October 2020 our Board of Directors authorized our 2020 Share Repurchase Program, which is a program to repurchase up to $5.0 billion of our common stock.

Our 2020 Share Repurchase Program does not have an expiration date.

All share repurchases under our 2020 Share Repurc hase

Table of Conten ts

Program will be retired.

Under our 2020 Share Repurchase Program, we repurchased and retired approximately 3.6 million, 6.0 million and 1.6 million shares of our common stock at a cost of approximately $750.0 million, $1.8 billion and $400.0 million during the years ended December 31, 2022, 2021 and 2020 , respectively.

Approximately $2.1 billion remained available under our 2020 Share Repurchase Program as of December 31, 2022.

In December 2019 our Board of Directors authorized our December 2019 Share Repurchase Program, which was a program to repurchase up to $5.0 billion of our common stock, which was completed as of September 30, 2020.

All shares repurchased under our December 2019 Share Repurchase Program were retired.

Under our December 2019 Share Repurchase Program, we repurchased and retired approximately 16.7 million shares of our common stock at a cost of

approximately $5.0 billion during the year ended December 31, 2020.

In March 2019 our Board of Directors authorized our March 2019 Share Repurchase Program, which was a program to repurchase up to $5.0 billion of our common stock, which was completed as of March 31, 2020.

All shares repurchased under our March 2019 Share Repurchase Program were retired.

Under our March 2019 Share Repurchase Program, we repurchased and retired approximately 4.1 million shares of our common stock at a cost of approximately $1.3 billion during the year ended December 31, 2020.

In August 2022 the IRA was signed into law.

Among other things, the IRA levies a 1.0% excise tax on net stock repurchases after December 31, 2022.

Historically, we have made discretionary share repurchases.

The following table summarizes our cash flow activity:

For the Years Ended December 31, % Change

For the Years Ended December 31, 2023

(In millions, except percentages) 2023 2022 2021

3 unchanged sentences

OPERATING ACTIVITIES

Cash flow from operating activities represents the cash receipts and disbursements related to all of our activities other than investing and financing activities.

We expect cash provided from operating activities will continue to be our primary source of funds to finance operating needs and capital expenditures for the foreseeable future.

Operating cash flow is derived by adjusting our net income for:

• non-cash operating items such as depreciation and amortization, impairment charges, unrealized gain (loss) on strategic investments, acquired IPR&D and share-based compensation;

• non-cash operating items such as depreciation and amortization, impairment charges, unrealized (gain) loss on strategic investments and share-based compensation;

• changes in operating assets and liabilities, which reflect timing differences between the receipt and payment of cash associated with transactions and when they are recognized in results of operations;

• changes in the fair value of contingent payments associated with our acquisitions of businesses and payments related to collaborations.

For 2022 compared to 2021, the decrease in net cash flow provided by operating activities was

primarily due to lower revenue in 2022, net payments of $917.0 million for a litigation settlement agreement and settlement fees and expenses, timing of payments and higher net income tax payments in 2022.

The higher tax payments are, in part, due to a change in the tax deductibility of payments made for research and development.

• (gains) losses on the disposal of assets, deferred income taxes, changes in the fair value of contingent payments associated with our acquisitions of businesses and acquired IPR&D.

For 2023 compared to 2022, the change in net cash flow provided by operating activities was driven by changes in operating assets and liabilities primarily related to a lower inventory build in 2023 as compared to 2022, the favorable timing of customer payment receipts in 2023 and the unfavorable timing of U.S.

federal tax payments in 2023.

Operating cash flow in 2023 was also negatively impacted by the $393.4 million in equity-based compensation payments associated with the Reata acquisition.

Operating cash flow in 2022 was also negatively impacted by the payment of of approximately $900.0 million, plus settlement fees and expenses, related to a litigation settlement agreement to resolve a qui tam litigation relating to conduct prior to 2015.

INVESTING ACTIVITIES

For 2022 compared to 2021, the increase in net cash flow provided by investing activities was primarily due to proceeds received from the sale of our 49.9% equity interest in Samsung Bioepis of $990.3 million, net of expenses, during the second quarter of 2022 as well as $582.6 million in net proceeds received from the sale of one of our buildings during the third quarter of 2022.

For 2023 compared to 2022, the change in net cash flow provided by (used in) investing activities was primarily due to a $6.9 billion payment made in 2023 for our acquisition of Reata, net of cash acquired, partially offset by higher net proceeds from the sales of marketable securities in the current period.

Additionally, we received $582.6 million in 2022 related to the sale of one of our buildings.

T able of Contents

FINANCING ACTIVITIES

For 2022 compared to 2021, the decrease in net cash flow used in financing activities was primarily due to $1.1 billion in lower share repurchases in 2022, partially offset by $832.2 million in higher debt repayments in 2022.

Table of Conten ts

For 2023 compared to 2022, the change in net cash flow provided by (used in) financing activities was primarily due to the issuance of our 2023 Term Loans totaling $1.0 billion under our $1.5 billion term loan credit agreement which were used to partially fund our acquisition of Reata, partially offset by repayments of borrowings and debt premiums paid totaling $809.9 million.

We had debt repayments of approximately $1.0 billion and share repurchases of $750.0 million during the same period in 2022.

For additional information on our acquisition of Reata, please read Note 2, Acquisitions , to our consolidated financial statements included in this report.

CAPITAL RESOURCES

DEBT AND CREDIT FACILITIES

LONG-TERM DEBT AND TERM LOAN CREDIT AGREEMENTS

Our long-term obligations primarily consist of long-term debt related to our Senior Notes with final maturity dates ranging between 2025 and 2051.

As of December 31, 2023, our outstanding balance related to long-term debt was $6,788.2 million.

In connection with our acquisition of Reata in September 2023 we entered into a $1.5 billion term loan credit agreement.

On the closing date of the Reata acquisition we drew $1.0 billion from the 2023 Term Loan, comprised of a $500.0 million floating rate 364-day tranche and a $500.0 million floating rate three-year tranche.

The remaining unused commitment of $500.0 million was terminated.

During the fourth quarter of 2023 we repaid $350.0 million of the 364-day tranche.

As of December 31, 2023, we had $650.0 million outstanding under the 2023 Term Loan, of which $150.0 million was outstanding under the 364-day tranche and $500.0 million was outstanding under the three-year tranche.

2020 REVOLVING CREDIT FACILITY

In January 2020 we entered into a $1.0 billion, five-year senior unsecured revolving credit facility under which we are permitted to draw funds for working capital and general corporate purposes.

The terms of the revolving credit facility include a financial covenant that requires us not to exceed a maximum consolidated leverage ratio.

As of December 31, 2023, we had no outstanding borrowings and were in compliance with all covenants under this facility.

For a summary of the fair values of our outstanding borrowings as of December 31, 2023 and 2022, please read Note 8, Fair Value Measurements, to our consolidated financial statements included in this report.

For additional information on our Senior Notes, 2023 Term Loan and credit facility please read, Note 13, Indebtedness , to our consolidated financial statements included in this report.

SHARE REPURCHASE PROGRAMS

In October 2020 our Board of Directors authorized our 2020 Share Repurchase Program, which is a program to repurchase up to $5.0 billion of our common stock.

Our 2020 Share Repurchase Program does not have an expiration date.

All share repurchases under our 2020 Share Repurc hase Program will be retired.

Under our 2020 Share Repurchase Program, we repurchased and retired approximately 3.6 million and 6.0 million shares of our common stock at a cost of approximately $750.0 million and $1.8 billion during the years ended December 31, 2022 and 2021 , respectively.

There were no share repurchases of our common stock during the year ended December 31, 2023.

Approximately $2.1 billion remained available under our 2020 Share Repurchase Program as of December 31, 2023.

CAPITAL EXPENDITURES

In the fourth quarter of 2021 we began construction of a new gene therapy manufacturing facility in RTP, North Carolina to support our gene therapy pipeline across multiple therapeutic areas.

The new manufacturing facility will be approximately 197,000 square feet with an estimated total investment of approximately $195.0 million.

As we continue to advance our research and development prioritization efforts, which includes refocusing our investment in gene therapy, we are evaluating several alternative uses for this facility.

T able of Contents

CONTRACTUAL OBLIGATIONS AND OFF-BALANCE SHEET ARRANGEMENTS

15 unchanged sentences

In addition to the minimum rental commitments, these leases may require us to pay additional amounts for taxes, insurance, maintenance and other operating expenses.

(2) Obligations are presented net of sublease income expected to be received for our vacated portion of our Weston, MA facility and other facilities throughout the world.

(3) In September 2022 we completed the sale of our building and land parcel located at 125 Broadway.

Simultaneously, with the close of this transaction we leased back the building for a term of approximately 5.5 years.

(4) Long-term debt obligations are related to our 2015 Senior Notes, our 2020 Senior Notes and our 2021 Exchange Offer Senior Notes, including principal and interest payments.

(5) Purchase and other obligations include $558.0 million related to the remaining payments on a one-time mandatory deemed repatriation tax on accumulated foreign subsidiaries' previously untaxed foreign earnings (the Transition Toll Tax) and $26.0 million related to the fair value of net liabilities on derivative contracts.

(2) Obligations are presented net of sublease income expected to be received for our vacated portions of our Weston, Massachusetts facility and other facilities throughout the world.

(3) In connection with our acquisition of Reata in September 2023 we assumed operating lease commitments, including the responsibility for a single-tenant, built-to-suit building with a total net present value of rental expense of approximately $154.4 million over the next 15 years.

For additional information on our acquisition of Reata, please read Note 2, Acquisitions , to our consolidated financial statements included in this report.

(4) Long-term debt obligations are related to our 2015 Senior Notes, our 2020 Senior Notes and our 2021 Exchange Offer Senior Notes, including principal and interest payments, and our 2023 Term Loan.

For additional information on our long-term debt obligations, please read Note 13, Indebtedness , to our consolidated financial statements included in this report.

(5) Purchase and other obligations include $419.5 million related to the remaining payments on the Transition Toll Tax and $31.6 million related to the fair value of net liabilities on derivative contracts.

ROYALTY PAYMENTS

1 unchanged sentence

Royalty payments are recognized as cost of sales in our consolidated statements of income.

We make royalty payments on annual worldwide net sales of SPINRAZA using a tiered royalty rate between 11.0% and 15.0%, which are recognized as cost of sales in our consolidated statements of income.

We make royalty payments to Alkermes Pharma Ireland Limited, a subsidiary of Alkermes plc (Alkermes) on worldwide net sales of VUMERITY using a royalty rate of 15.0%, which are recognized as cost of sales in our consolidated statements of income.

We make royalty payments to Ionis on annual worldwide net sales of SPINRAZA using a tiered royalty rate between 11.0% and 15.0%, which are recognized as cost of sales in our consolidated statements of income.

For additional information on our collaboration arrangements with Ionis, please read Note 19, Collaborative and Other Relationships , to our consolidated financial statements included in this report.

We make royalty payments to Ionis on annual worldwide net sales of QALSODY using a tiered royalty rate between 11.0% and 15.0%, which are recognized as cost of sales in our consolidated statements of income.

For additional information on our collaboration arrangements with Ionis, please read Note 19, Collaborative and Other Relationships , to our consolidated financial statements included in this report.

We make royalty payments to Alkermes on worldwide net sales of VUMERITY using a royalty rate of 15.0%, which are recognized as cost of sales in our consolidated statements of income.

Royalties payable on net sales of VUMERITY are subject, under certain circumstances, to tiered minimum annual payment requirements for a period of five years following FDA approval.

T able of Contents

In October 2019 we entered into a new supply agreement and amended our license and collaboration agreement with Alkermes for VUMERITY.

We have elected to initiate a technology transfer and,

following a transition period, to manufacture VUMERITY or have VUMERITY manufactured by a third party we have engaged in exchange for paying an increased royalty rate to Alkermes on any portion of future worldwide net commercial sales of VUMERITY that is manufactured by us or our designee.

We have elected to initiate a technology transfer and, following a transition period, to manufacture VUMERITY or have VUMERITY manufactured by a third party we have engaged in exchange for paying an increased royalty rate to Alkermes on any portion of future worldwide net commercial sales of VUMERITY that is manufactured by us or our designee.

For additional information on our collaboration arrangement with Alkermes, please read Note 19, Collaborative and Other Relationships , to our consolidated financial statements included in this report.

In connection with our acquisition of Reata in September 2023 we assumed additional contractual obligations related to royalty payments.

Reata entered into agreements to pay royalties on future sales of SKYCLARYS, which will cumulatively range in the low- to mid-single digits.

For additional information on our acquisition of Reata, please read Note 2, Acquisitions , to our consolidated financial statements included in this report.

CONTINGENT DEVELOPMENT, REGULATORY AND COMMERCIAL MILESTONE PAYMENTS

1 unchanged sentence

Payments under these agreements generally become due and payable upon achievement of certain development, regulatory or commercial milestones.

Because the achievement of these milestones was not considered probable as

Table of Conten ts

of December 31, 2022, such contingencies have not been recorded in our financial statements.

Because the achievement of these milestones was not considered probable as of December 31, 2023, such contingencies have not been recorded in our financial statements.

Amounts related to contingent milestone payments are not considered contractual obligations as they are contingent on the successful achievement of certain development, regulatory or commercial milestones.

If certain clinical and commercial milestones are met, we may pay up to $356.2 million in milestones in 2023 under our current agreements.

This includes milestones totaling $225.0 million due to Sage upon the first commercial sale of zuranolone, for the potential treatment of MDD and PPD, in the U.S.

During the fourth quarter of 2023 we accrued a milestone payment due to Sage of $75.0 million upon the first commercial sale of ZURZUVAE for PPD in the U.S., which was recorded within intangible assets, net in our consolidated balance sheets, and subsequently paid in January 2024.

If certain clinical and commercial milestones are met, we may pay up to approximately $109.0 million in milestones in 2024 under our current agreements.

OTHER FUNDING COMMITMENTS

9 unchanged sentences

Of the amounts accrued as of December 31, 2023, approximately $185.4 million is expected to be paid within one year.

The Transition Toll Tax will be paid in installments over an eight--year period, which started in 2018, and will not accrue interest.

The Transition Toll Tax is being paid in installments over an eight--year period, which started in 2018, and will not accrue interest.

OTHER OFF-BALANCE SHEET ARRANGEMENTS

2 unchanged sentences

We consolidate variable interest entities if we are the primary beneficiary.

T able of Contents

NEW ACCOUNTING STANDARDS

3 unchanged sentences

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

The preparation of our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the U.S.

The preparation of our consolidated financial statements, which have been prepared in accordance with U.S.

GAAP, requires us to make estimates, judgments and assumptions that may affect the reported amounts of assets, liabilities, equity, revenue and expense and related disclosure of contingent assets and liabilities.

5 unchanged sentences

We recognize revenue when our customer obtains control of promised goods or services, in an amount that reflects the consideration which we expect to receive in exchange for those goods or services.

We recognize revenue following the five-step model prescribed under Financial Accounting Standards Board (FASB) Accounting Standards Codification 606, Revenue from Contracts with Customers :

We recognize revenue following the five-step model prescribed under FASB ASC 606, Revenue from Contracts with Customers :

(i) identify contract(s) with a customer;

6 unchanged sentences

In other countries, we sell our products primarily to wholesale distributors, hospitals, pharmacies and other third-party distribution partners.

These customers subsequently resell our products to

Table of Conten ts

health care providers and patients.

These customers subsequently resell our products to health care providers and patients.

In addition, we enter into arrangements with health care providers and payors that provide for government-mandated or privately-negotiated discounts and allowances related to our products.

9 unchanged sentences

These estimates reflect our historical experience, current contractual and statutory requirements, specific known market events and trends, industry data and forecasted customer buying and payment patterns.

The transaction price, which includes variable consideration reflecting the impact of discounts and allowances, may be subject to constraint and is included in the net sales price only to the extent that it is probable that a significant reversal of the amount of the cumulative revenue recognized will not occur in a future period.

T able of Contents

cumulative revenue recognized will not occur in a future period.

Actual amounts may ultimately differ from our estimates.

If actual results vary, we adjust these estimates, which could have an effect on earnings in the period of adjustment.

As of December 31, 2022, a 10.0% change in our discounts, contractual adjustments and reserves

would have resulted in a decrease of our pre-tax earnings by approximately $338.6 million.

As of December 31, 2023 and 2022, a 10.0% change in our discounts, contractual adjustments and reserves would have resulted in a decrease of our pre-tax earnings by approximately $345.5 million and $338.6 million, respectively.

In addition to discounts, rebates and product returns, we also maintain certain customer service contracts with distributors and other customers in the distribution channel that provide us with inventory management, data and distribution services, which are generally reflected as a reduction of revenue.

1 unchanged sentence

For additional information on our revenue, please read Note 5, Revenue , to our consolidated financial statements included in this report.

At each reporting period we review our inventories for excess or obsolescence and write-down obsolete or otherwise unmarketable inventory to its estimated net realizable value.

The determination of obsolete or excess inventory requires management to make estimates based on assumptions about the future demand of our products, product expiration dates, estimated future sales and our general future plans.

If customer demand subsequently differs from our forecasts, we may be required to record additional charges for excess inventory.

Although we believe that the assumptions we use in estimating inventory write-downs are reasonable, no assurance can be given that significant future changes in these assumptions or changes in future events and market conditions could result in different estimates.

During 2021 we wrote-off approximately $120.0 million of inventory in excess of forecasted demand related to ADUHELM.

During the first quarter of 2022 we wrote-off approximately $275.0 million, as a result of the final CMS decision.

As of December 31, 2022, the carrying value of our ADUHELM inventory was immaterial.

As of December 31, 2021, we had approximately $223.0 million of ADUHELM inventory.

ACQUIRED INTANGIBLE ASSETS, INCLUDING IPR&D

1 unchanged sentence

If we acquire an asset or group of assets that do not meet the definition of a business under applicable accounting standards, the acquired IPR&D is expensed on its acquisition date.

Future costs to develop these assets are recorded to

Table of Conten ts

research and development expense as they are incurred.

Future costs to develop these assets are recorded to research and development expense as they are incurred.

We have acquired, and expect to continue to acquire, intangible assets through the acquisition of biotechnology companies or through the consolidation of variable interest entities.

These intangible assets primarily consist of technology associated with human therapeutic products and IPR&D product candidates.

These intangible assets primarily consist of technology associated with human therapeutic products, IPR&D product candidates and priority review vouchers.

When significant identifiable intangible assets are acquired, we generally engage an independent third-party valuation firm to assist in determining the fair values of these assets as of the acquisition date.

9 unchanged sentences

No assurance can be given that the underlying assumptions used to estimate expected project sales, development costs or profitability, or the events associated with such projects, will transpire as estimated.

At each reporting period we review our inventories for excess or obsolescence and write-down obsolete or otherwise unmarketable inventory to its estimated net realizable value.

If customer demand subsequently differs from our forecasts, we may be required to record additional charges for excess inventory.

During 2022 and 2021 we wrote-off excess inventory of $275.0 million and $120.0 million, respectively, related to ADUHELM.

T able of Contents

IMPAIRMENT AND AMORTIZATION OF LONG-LIVED ASSETS

2 unchanged sentences

We review our intangible assets with indefinite lives for impairment annually, as of October 31, and whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable.

When performing our impairment assessment, we calculate the fair value using the same methodology as described above under Acquired

Intangible Assets, including IPR&D .

When performing our impairment assessment, we calculate the fair value using the same methodology as described above under Acquired Intangible Assets, including IPR&D .

If the carrying value of our acquired IPR&D exceeds its fair value, then the intangible asset is written down to its fair value.

1 unchanged sentence

Impairments are recorded within amortization and impairment of acquired intangible assets in our consolidated statements of income.

Based on our most recent impairment assessment we incurred impairment charges of approximately $119.6 million and $629.3 million for the years ended December 31, 2022 and 2021, respectively, mainly related to the discontinuation of IPR&D programs.

For additional information on our impairments, Note 7, Intangible Assets and Goodwill , to our consolidated financial statements included in this report.

Based on our most recent impairment assessment we incurred impairment charges of approximately $119.6 million for the year ended December 31, 2022, mainly related to the discontinuation of IPR&D programs.

For the year ended December 31, 2023, we had no impairment charges.

For additional information on our impairments, please read Note 7, Intangible Assets and Goodwill , to our consolidated financial statements included in this report.

Our most significant intangible assets are our acquired and in-licensed rights and patents.

3 unchanged sentences

For additional information on the impairment charges related to our long-lived assets during 2023, 2022 and 2021, please read Note 7, Intangible Assets and Goodwill, to our consolidated financial statements included in this report.

Contingent Consideration

We record contingent consideration resulting from a business combination at its fair value on the acquisition date.

Each reporting period thereafter, we revalue the remaining obligations and record increases or decreases in their fair value as an adjustment to contingent consideration expense in our consolidated statements of income.

Changes in the fair value of our contingent consideration obligations can result from changes to one or multiple inputs, including adjustments to the discount rates and achievement and timing of any cumulative sales-based and development milestones or changes in the probability of certain clinical events and changes in the assumed probability associated with regulatory approval.

These fair value measurements represent Level 3 measurements as they are based on significant inputs not observable in the market.

Table of Conten ts

Significant judgment is employed in determining the appropriateness of these assumptions as of the acquisition date and for each subsequent period.

Accordingly, changes in assumptions described above, could have a material impact on the amount of contingent consideration expense we record in any given period.

We prepare and file income tax returns based on our interpretation of each jurisdiction’s tax laws and regulations.

1 unchanged sentence

These differences result in deferred tax assets and liabilities, which are included in our consolidated balance sheets.

Upon our election in the fourth quarter of 2018 to record deferred taxes for global intangible low-taxed income (GILTI), we have included amounts related to GILTI taxes within temporary difference.

Upon our election in the fourth quarter of 2018 to record deferred taxes for GILTI, we have included amounts related to GILTI taxes within temporary difference.

Significant management judgment is required in assessing the realizability of our deferred tax assets.

6 unchanged sentences

We adjust the level of the liability to reflect any subsequent changes in the relevant facts surrounding the uncertain positions.

Our liabilities for uncertain tax positions can be relieved only if the contingency becomes legally extinguished, through

either payment to the taxing authority or the expiration of the statute of limitations, the recognition of the benefits associated with the position meet the “more likely than not” threshold or the liability becomes effectively settled through the examination process.

We consider matters to be effectively settled once the taxing authority has completed all of its required or expected examination procedures, including all appeals and administrative reviews, we have no plans to appeal or litigate any aspect of the tax position and we believe that it is highly unlikely that the taxing authority would examine or re-examine the related tax position.

Our liabilities for uncertain tax positions can be relieved only if the contingency becomes legally extinguished, through either payment to the taxing authority or the expiration of the statute of limitations, the recognition of the benefits associated with the position meet the “more likely than not” threshold or the liability becomes effectively settled through the examination process.

T able of Contents

or re-examine the related tax position.

We also accrue for potential interest and penalties related to unrecognized tax benefits in income tax expense.

BUSINESS COMBINATIONS

Business combinations are recorded using the acquisition method of accounting.

The results of operations of the acquired company are included in our results of operations beginning on the acquisition date, and assets acquired and liabilities assumed are recognized on the acquisition date at their respective fair values.

Any excess of consideration transferred over the net carrying value of the assets acquired and liabilities assumed as of the acquisition date is recognized as goodwill.

We use the multi-period excess earnings method, which is a form of the income approach, utilizing post-tax cash flow and discount rates in estimating the fair value of identifiable intangible assets acquired when allocating the purchase consideration paid for the acquisition.

The estimates of the fair value of identifiable intangible assets involve significant judgment by management and include assumptions with measurement uncertainty, such as the amount and timing of projected cash flow, long-term sales forecasts, discount rates and additionally for IPR&D intangible assets, the timing and probability of regulatory and commercial success.

We use the net realizable value method in estimating the fair value of acquired finished goods and work-in-process inventory.

Raw materials acquired are valued using the replacement cost method.

Transaction and restructuring costs related to business combinations are expensed as incurred.

The fair value of assets acquired and liabilities assumed in certain cases may be subject to revision based on the final determination of fair value during a period of time not to exceed 12 months from the acquisition date.

If we determine the assets acquired do not meet the definition of a business, the transaction will be accounted for as an asset acquisition rather than a business combination.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 7. Management’s Discussion and Analysis