What changed in this filing

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Item 1A. Risk Factors

2025-02-12 compared with 2024-02-14 · 119 added, 105 removed, 339 unchanged (40% of the section changed)

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• our ability to maintain a positive reputation among patients, healthcare providers and others, which may be impacted by our pricing and reimbursement decisions.

LEQEMBI and SKYCLARYS are in the early stages of commercial launch in the U.S.

LEQEMBI is in the early stages of commercial launch in the U.S.

and certain international markets and SKYCLARYS is in the early stages of commercial launch in the U.S.

and certain European markets.

In addition to risks associated with new product launches and the other factors described in these Risk Factors, Biogen’s and Eisai’s ability to successfully commercialize LEQEMBI and our ability to successfully commercialize SKYCLARYS may be adversely affected due to:

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• the approval of other new products for the same or similar indications;

• Eisai’s and Biogen’s ability to maintain a positive reputation among patients, healthcare providers and others in the Alzheimer’s disease community, which may be impacted by pricing and reimbursement decisions relating to LEQEMBI, which are made by Eisai;

• Biogen's ability to obtain and maintain adequate reimbursement for SKYCLARYS;

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It is difficult to predict the success and the time and cost of product development of novel approaches for the treatment of diseases.

The development of novel approaches for the treatment of diseases, including development efforts in new modalities such as those based on the antisense oligonucleotide platform and gene therapy, may present additional challenges and risks, including obtaining approval from regulatory authorities that have limited experience with the development of such therapies.

For example, we are currently seeking approval of SKYCLARYS in Europe and any delays or challenges regarding its approval in Europe may adversely impact our ability to realize the anticipated benefits from the Reata acquisition.

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The development of novel approaches for the treatment of diseases, including development efforts in new modalities such as those based on the antisense oligonucleotide platform and gene therapy, presents additional challenges and risks, including obtaining approval from regulatory authorities that have limited experience with the development of such therapies.

For example, we are currently seeking approval of LEQEMBI in Europe and the approval of a subcutaneous formulation of LEQEMBI in the U.S.

and any delays or challenges may impact our ability to realize the anticipated benefits from LEQEMBI.

Clinical trial data are subject to differing interpretations and even if we view data as sufficient to support the safety, effectiveness and/or approval of an investigational therapy, regulatory authorities may disagree and may require additional data, limit the scope of the approval or deny approval altogether.

Furthermore, the approval of a product candidate by one regulatory agency does not mean that other regulatory agencies will also approve such product candidate.

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Success in preclinical work or early-stage clinical trials does not ensure that later stage or larger scale clinical trials will be successful.

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Even if we could successfully develop new products or indications, we may make a strategic decision to discontinue development of a product candidate or indication if, for example, we believe commercialization will be difficult relative to the standard of care or we prioritize other opportunities in our pipeline.

Sales of new products or products with additional indications may not meet investor expectations.

Additionally, sales of new products or products with additional indications may not meet investor expectations.

If we fail to compete effectively, our business and market position would suffer.

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market in 2020.

In addition, in some markets, when a generic or biosimilar version of one of our products is commercialized, it may be automatically substituted for our product and significantly reduce our revenue in a short period of time.

In addition, in some markets, when a generic or biosimilar version of one of our products is commercialized, it has in the past and may in the future be automatically substituted for our product and significantly reduce our revenue in a short period of time.

Our ability to compete, maintain and grow our business may also be adversely affected due to a number of factors, including:

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Our business may be adversely affected if we do not successfully execute or realize the anticipated benefits of our strategic and growth initiatives.

The successful execution of our strategic and growth initiatives may depend upon internal development projects, commercial initiatives and external opportunities, which may include the acquisition and in-licensing of products,

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technologies, companies, the entry into strategic alliances and collaborations or our Fit for Growth program, as well as our ability to execute on previously-announced initiatives such as the exploration of strategic options for our biosimilars business.

The successful execution of our strategic and growth initiatives depends upon internal development projects, commercial initiatives and external opportunities, which may include the acquisition and in-licensing of products, technologies, companies, the entry into strategic alliances and collaborations or our Fit for Growth program, as well as our ability to execute on strategic decisions and initiatives.

While we believe we have a number of promising programs in our pipeline, failure or delay of internal development projects to advance or difficulties in executing on our commercial initiatives could impact our current and future growth, resulting in additional reliance on external development opportunities for growth.

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Supporting the further development of our existing products and potential new products in our pipeline will require significant capital expenditures and management resources, including investments in research and development, sales and marketing, manufacturing capabilities and other areas of our business.

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We may fail to initiate or complete transactions for many reasons, including failure to obtain regulatory or other approvals as well as a result of disputes or litigation.

Furthermore, we may not be able to achieve the full strategic and financial benefits expected to result from transactions, or the benefits may be delayed or not occur at all.

Furthermore, we may not be able to achieve the full strategic and financial benefits expected to result from transactions or strategic decisions, such as the decision to retain the biosimilars business, or the benefits may be delayed or not occur at all.

We may also face additional costs or liabilities in completed transactions that were not contemplated prior to completion.

Any failure in the execution of a transaction, in the integration of an acquired asset or business or in achieving expected synergies could result in slower growth, higher than expected costs, the recording of asset impairment charges and other actions which could adversely affect our business, financial condition and results of operations.

For example, we recently acquired Reata and are in the process of integrating Reata into our Company.

The ultimate success of our acquisition of Reata and our ability to realize the anticipated benefits from the acquisition, including the SKYCLARYS product and anticipated synergies, depends on, among other things, how effective we are in integrating the Biogen and Reata operations.

For example, we recently acquired Reata and HI-Bio and are in the process of integrating Reata and HI-Bio into our Company.

The ultimate success of our acquisitions of Reata and HI-Bio and our ability to realize the anticipated benefits from the acquisitions, including future performance of the SKYCLARYS product and further development of the felzartamab product and anticipated synergies, depends on, among other things, how effective we are in integrating the Biogen, Reata and HI-Bio operations.

We face risks associated with our Fit for Growth program that may impair our ability to achieve anticipated savings and operational efficiencies or that may otherwise harm our business.

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• our ability to receive reimbursement for our products or our ability to receive comparable reimbursement to that of competing products;

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• our value-based contracting program pursuant to which we aim to tie the pricing of our products to their clinical values by either aligning price to patient outcomes or adjusting price for patients who discontinue therapy for any reason, including efficacy or tolerability concerns.

Our ability to set the price for our products varies significantly from country to country and, as a result, so can the price of our products.

Governments may use a variety of cost-containment measures to control the cost of products, including price cuts, mandatory rebates, value-based pricing and reference pricing (i.e., referencing prices in other countries and using those reference prices to set a price).

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countries and using those reference prices to set a price).

Drug prices are under significant scrutiny in the markets in which our products are prescribed;

for example the IRA has certain provisions related to drug pricing.

for example the IRA has certain provisions related to drug pricing, including the ability for the U.S.

government to set prices for certain drugs in Medicare.

We expect drug pricing and other health care costs to continue to be subject to intense political and societal pressures on a global basis.

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Our failure to obtain or maintain adequate coverage, pricing or reimbursement for our products could have an adverse effect on our business, reputation, revenue and results of operations.

We depend on relationships with collaborators and other third-parties for revenue, and for the development, regulatory approval, commercialization and marketing of certain of our products and product candidates, which are outside of our full control.

We rely on a number of collaborative and other third-party relationships for revenue and the development, regulatory approval, commercialization and marketing of certain of our products and product candidates.

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• disputes may arise under an agreement, including with respect to the achievement and payment of milestones, payment of development or commercial costs, ownership of rights to technology developed, and the underlying agreement may fail to provide us with significant protection or may fail to be effectively enforced if the collaborators or third-parties fail to perform;

• the interests of our collaborators or third-parties may not always be aligned with our interests, and such parties may not pursue regulatory approvals or market a product in the same manner or to the same extent

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that we would, which could adversely affect our revenue, or may adopt tax strategies that could have an adverse effect on our business, results of operations or financial condition;

• third-party relationships require the parties to cooperate, and failure to do so effectively could adversely affect product sales or the clinical development or regulatory approvals of product candidates under joint control, could result in termination of the research, development or commercialization of product candidates or could result in litigation or arbitration;

• the interests of our collaborators or third-parties may not always be aligned with our interests, and such parties may not protect and enforce any intellectual property rights or pursue regulatory approvals or market a product in the same manner or to the same extent that we would, which could adversely affect our revenue, or may adopt tax strategies that could have an adverse effect on our business, results of operations or financial condition;

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could result in termination of the research, development or commercialization of product candidates or could result in litigation or arbitration;

• any failure on the part of our collaborators or third-parties to comply with applicable laws, including tax laws, regulatory requirements and/or applicable contractual obligations or to fulfill any responsibilities they may have to protect and enforce any intellectual property rights underlying our products could have an adverse effect on our revenue or reputation as well as involve us in possible legal proceedings;

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Legislative and regulatory proposals, enactments to reform health care insurance programs (including those contained in the IRA) and increasing pressure from social sources could significantly influence the manner in which our products are prescribed, purchased and reimbursed.

For example, provisions of the PPACA have resulted in changes in the way health care is paid for by both governmental and private insurers, including increased rebates owed by manufacturers under the Medicaid Drug Rebate Program, annual fees and taxes on manufacturers of certain branded prescription drugs, the requirement that manufacturers participate in a discount program for certain outpatient drugs under Medicare Part D and the expansion of the number of hospitals eligible for discounts under Section 340B of the Public Health Service Act.

For example, provisions of the PPACA have resulted in changes in the way health care is paid for by both governmental and private insurers, including increased rebates owed by manufacturers under the Medicaid Drug Rebate Program, annual fees and taxes on manufacturers of certain branded prescription drugs, the requirement that manufacturers participate in a discount program for certain outpatient drugs under Medicare Part D and under Section 340B of the Public Health Service Act and similar state legislation.

These changes have had and are expected to continue to have a significant impact on our business.

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In addition, there have been (including elements of the IRA), and are expected to continue to be, legislative proposals to address prescription drug pricing.

Some of these proposals could have significant effects on our business, including an executive order issued in September 2020 to test a “most favored nation” model for Part B and Part D drugs that tie reimbursement rates to international drug pricing metrics.

These actions and the uncertainty about the future of the PPACA and healthcare laws may put downward pressure on pharmaceutical pricing and increase our regulatory burdens and operating costs.

We face uncertainties regarding potential healthcare reforms, governmental policy and prioritization, and the uncertainty about the future of the PPACA and healthcare laws may put downward pressure on pharmaceutical pricing and increase our regulatory burdens and operating costs.

There is also significant economic pressure on state budgets, that may result in states increasingly seeking to achieve budget savings through mechanisms that limit coverage or payment for our drugs.

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and some other international markets, the government provides health care at low cost to consumers and regulates pharmaceutical prices, patient eligibility or reimbursement levels to control costs for the government-sponsored health care system.

Many countries have announced or implemented measures, and may in the future implement new or additional measures, to reduce health care costs to limit the overall level of government

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expenditures.

Many countries have announced or implemented measures, and may in the future implement new or additional measures, to reduce health care costs to limit the overall level of government expenditures.

These measures vary by country and may include, among other things, patient access restrictions, suspensions on price increases, prospective and possible retroactive price reductions and other recoupments and increased mandatory discounts or rebates, recoveries of past price increases and greater importation of drugs from lower-cost countries.

These measures have negatively impacted our revenue and may continue to adversely affect our revenue and results of operations in the future.

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Our success in commercializing biosimilars is subject to risks and uncertainties inherent in the development, manufacture and commercialization of biosimilars.

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We are dependent, in part, on the efforts of collaboration partners and other third-parties over whom we have limited or no control in the development and manufacturing of biosimilars products.

For example, a recently announced potential acquisition of a contract development and manufacturing organization by a third party.

For example, a recently completed acquisition of a contract development and manufacturing organization by a third party may impact its operational, strategic or financial risk.

If these third-parties fail to perform successfully, or reduce their third party manufacturing production, our biosimilar product development or commercialization of biosimilar products could be delayed, revenue from biosimilar products could decline and/or we may not realize the anticipated benefits of these arrangements;

• Competitive Challenges.

Biosimilar products face significant competition, including from innovator products and biosimilar products offered by other companies that may receive greater acceptance or more favorable reimbursement.

Local tendering processes may restrict biosimilar products from being marketed and sold in some jurisdictions.

The number of competitors in a jurisdiction, the timing of approval and the ability to market biosimilar products successfully in a timely and cost-effective manner are additional factors that may impact our success in this business area;

• Regulatory Compliance.

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Manufacturing biosimilars is complex.

If we encounter any manufacturing or supply chain difficulties we may be unable to meet demand.

If we encounter any persistent manufacturing or supply chain difficulties we may be unable to meet demand.

We are dependent on a third-party for the manufacture of our biosimilar products and such third-party may not perform its obligations in a timely and cost-effective manner or in compliance with applicable regulations and may be unable or unwilling to increase production capacity commensurate with demand for our existing or future biosimilar products.

For example, one of our contract manufacturers for IMRALDI and BENEPALI was acquired by a third party in December 2024, which may have an impact on our biosimilars business;

• Intellectual Property and Regulatory Challenges.

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Market success of biosimilar products will be adversely affected if patients, physicians and/or payors do not accept biosimilar products as safe and efficacious products offering a more competitive price or other benefit over existing therapies.

• Competitive Challenges.

Local tendering processes may restrict biosimilar products from being marketed and sold in some jurisdictions.

The decision to explore strategic options related to our biosimilars business could adversely affect our operations related to our biosimilars business.

Risks Related to Intellectual Property

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In addition, settlements of such proceedings often result in reducing the period of exclusivity and other protections, resulting in a reduction in revenue from affected products.

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In many markets, including the U.S., manufacturers may be allowed to rely on the safety and efficacy data of the innovator's product and do not need to conduct clinical trials before marketing a competing version of a product after there is no longer patent or regulatory exclusivity.

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In addition, manufacturers of generics and biosimilars may choose to launch or attempt to launch their products before the expiration of our patent or other intellectual property protections.

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Furthermore, our products may be determined to infringe patents or other intellectual property rights held by third-parties.

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Successful preclinical work or early stage clinical trials does not ensure success in later stage trials, regulatory approval or commercial viability of a product.

Positive results in a clinical trial may not be replicated in subsequent or confirmatory trials.

Positive results in a clinical trial have in the past and may not in the future be replicated in subsequent or confirmatory trials.

Additionally, success in preclinical work or early stage clinical trials does not ensure that later stage or larger scale clinical trials will be successful or that regulatory approval will be obtained.

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Regulatory authorities may also fail to approve the facilities or processes used to manufacture a product candidate, our dosing or delivery methods or companion devices.

Regulatory authorities may grant marketing approval that is more restricted than anticipated, including limiting indications to narrow patient populations and the imposition of safety monitoring, educational requirements, requiring confirmatory trials and risk evaluation and mitigation strategies.

Regulatory authorities have in the past and may in the future grant marketing approval that is more restricted than anticipated, including limiting indications to narrow patient populations and the imposition of safety monitoring, educational requirements, requiring confirmatory trials and risk evaluation and mitigation strategies.

The occurrence of any of these events could result in significant costs and expense, have an adverse effect on our business, financial condition and results of operations and/or cause our stock price to decline or experience periods of volatility.

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Adverse safety events involving our marketed products, generic or biosimilar versions of our marketed products or products from the same class as one of our products may have a negative impact on our business.

Discovery of safety issues with our products could create product liability and could cause additional regulatory scrutiny and

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requirements for additional labeling or safety monitoring, withdrawal of products from the market and/or the imposition of fines or criminal penalties.

Discovery of safety issues with our products could create product liability and could cause additional regulatory scrutiny and requirements for additional labeling or safety monitoring, withdrawal of products from the market and/or the imposition of fines or criminal penalties.

Adverse safety events may also damage physician, patient and/or investor confidence in our products and our reputation.

Any of these could result in adverse impacts on our results of operations.

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Regulatory authorities are making greater amounts of stand-alone safety information directly available to the public through periodic safety update reports, patient registries and other reporting requirements.

The reporting of adverse safety events involving our products or products similar to ours and public rumors about such events may increase claims against us and may also cause our product sales to decline or our stock price to experience periods of volatility.

Restrictions on use or safety warnings that may be required to be included in the label of our products may significantly reduce expected revenue for those products and require significant expense and management time.

Risks Related to Our Operations

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As a result, we are increasingly dependent upon our information systems to operate our business and our ability to effectively manage our business depends on the security, reliability and adequacy of our information systems and data, which includes use of cloud technologies, including Software as a Service (SaaS), Platform as a Service (PaaS) and Infrastructure as a Service (IaaS).

Breakdowns, invasions, corruptions, destructions and/or breaches, which impact may include, but not limited to, comprising the capacity, reliability or security of our information systems or those of our business partners, including our cloud tech

nologies, and/or unauthorized access to our data and information could subject us to significant liability, negatively impact our business operations, and/or require replacement of technology and/or sizeable ransom payments.

Breakdowns, invasions, corruptions, destructions and/or breaches, which may include impacts such as, but not limited to, comprising the capacity, reliability or security of our information systems or those of our business partners, including our cloud technologies, and/or unauthorized access to our data and information could subject us to significant liability, negatively impact our business operations, and/or require replacement of technology and/or sizeable ransom payments.

Our information systems, including our cloud technologies, continue to increase in multitude and complexity, increasing our vulnerability when breakdowns, malicious intrusions and random attacks occur.

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Cybersecurity threats and incidents are often carried out by motivated, well-resourced, skilled and persistent actors, including nation states, organized crime groups, “hacktivists” and may include or target employees or contractors acting with careless or malicious intent.

Recent developments in the threat landscape include use of AI and machine learning, as well as an increased number of cyber extortion attacks, with higher financial ransom demand amounts and increasing sophistication and variety of ransomware techniques and methodology.

Recent developments in the threat landscape include use of adversarial AI techniques and machine learning, as well as an increased number of cyber extortion attacks, with higher financial ransom demand amounts and increasing sophistication and variety of ransomware techniques and methodology.

Geopolitical instability, including that related to Russia's invasion of Ukraine or the conflict in the Middle East, may increase the risk of cybersecurity threats.

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Our liability insurance may not be sufficient in type or amount to cover us against claims related to security breaches, cyber-attacks and other related breaches.

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Regulations continue to change as regulators worldwide consider new rules.

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These new regulations or other regulations being considered in Europe and around the world may impact the manner in which we operate.

Regulators are imposing new data privacy and security requirements, including new and greater monetary fines for privacy violations.

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Regulators currently impose new data privacy and security requirements, including monetary fines for privacy violations.

For example, the E.U.’s General Data Protection Regulation established regulations regarding the handling of personal data, and provides an enforcement authority and imposes large penalties for noncompliance.

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Failure to comply with these current and future laws, policies, industry standards or legal obligations or any security incident resulting in the unauthorized access to, or acquisition, release or transfer of personal information may result in governmental enforcement actions, litigation, fines and penalties or adverse publicity and could cause our customers to lose trust in us, which could have a material adverse effect on our business and results of operations.

The increasing use of AI-based software presents new risks and challenges and could adversely affect our business and reputation.

The use of AI-based software is increasingly being used in the biopharmaceutical industry, including by us, such as for research, marketing, manufacturing and commercialization, and we expect to use technology that uses AI in the future.

As with many developing technologies, AI-based software presents risks and challenges.

For example, algorithms may be flawed;

data sets may be insufficient, of poor quality or contain biased information;

and inappropriate or controversial data practices could impair results.

If the analyses that AI-based software assist in producing are deficient or inaccurate, we could be subjected to competitive harm, potential legal liability and brand or reputational harm.

Use of AI-based software may also lead to cybersecurity risks or the release of confidential proprietary information, including personal data, which may impact our ability to realize the benefit of our intellectual property or violate our internal policies, data protection laws or contractual requirements.

The use of AI-based software may also result in unauthorized access of personal data or the intellectual property of third parties.

Since the use of AI is subject to new or evolving laws and regulations, compliance may impose operational costs and limit our ability to use AI-based software, and failure to comply may result in potential government actions, litigation, fines, penalties or adverse publicity.

Manufacturing issues could substantially increase our costs, limit supply of our products and/or reduce our revenue.

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In some cases, due to the unique manner in which our products are manufactured, we rely on single source providers of raw materials and manufacturing supplies.

These third-parties are independent entities subject to their own unique operational and financial risks that are outside of our control.

For example, a recently announced potential acquisition of a contract development and manufacturing organization by a third party.

These third-parties are independent entities subject to their own unique operational, strategic and financial risks that are outside of our control.

For example, a recently completed acquisition of a contract development and manufacturing organization by a third party may impact its operational, strategic or financial risk.

These third-parties may not perform their obligations in a timely and cost-effective manner or in compliance with applicable regulations, and they may be unable or unwilling to increase production capacity commensurate with demand for our existing or future products.

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We rely on our manufacturing facilities for the production of drug substance for our large molecule products and product candidates.

Our global bulk supply of these products and product candidates depends on the uninterrupted and efficient operation of these facilities, which could be adversely affected by equipment failures, labor or raw material shortages, geopolitical instability, public health epidemics, natural disasters, power failures, cyber-attacks and many other factors.

Our global bulk supply of these products and product candidates depends on the uninterrupted and efficient operation of these facilities, which could be adversely affected by equipment failures, labor or raw material shortages, geopolitical instability, public health epidemics, natural disasters, adverse weather events, power failures, cyber-attacks and many other factors.

• Risks Relating to Compliance with current GMP (cGMP).

We and our third-party providers are generally required to maintain compliance with cGMP and other stringent requirements and are subject to inspections by the FDA and other regulatory authorities to confirm compliance.

We and our third-party providers are required to maintain compliance with cGMP and other stringent requirements, as applicable, and are subject to inspections by the FDA and other regulatory authorities to confirm compliance.

Any delay, interruption or other issues that arise in the manufacture, fill-finish, packaging or storage of our products as a result of a failure of our facilities or operations or those of third-parties to receive regulatory approval or pass any regulatory agency inspection could significantly impair our ability to develop and commercialize our products.

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Even minor deviations from normal manufacturing processes could result in reduced production yields, product defects and other supply disruptions.

If microbial, viral or other contaminations are discovered in our products or manufacturing facilities, we may need to close our manufacturing facilities for an extended period of time to investigate and remediate the contaminant.

If microbial, viral or other contaminations are discovered

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in our products or manufacturing facilities, we may need to close our manufacturing facilities for an extended period of time to investigate and remediate the contaminant.

Any adverse developments affecting our manufacturing operations or the operations of our third-party suppliers and manufacturers may result in shipment delays, inventory shortages, lot failures, product withdrawals or recalls or other interruptions in the commercial supply of our products.

Furthermore, factors such as geopolitical events, global health outbreaks, weather events, labor or raw material shortages and other supply chain disruptions could result in difficulties and delays in manufacturing our products, which could have an adverse impact on our results in operations or result in product shortages.

Furthermore, factors such as geopolitical events, global health outbreaks, adverse weather events, labor or raw material shortages, imposition of tariffs or trade restrictions and other supply chain disruptions could result in difficulties and delays in manufacturing our products, which could have an adverse impact on our results in operations or result in product shortages.

We may also have to take inventory write-offs and incur other charges and expense for products that fail to meet specifications, undertake costly remediation efforts or seek more costly manufacturing alternatives.

Such developments could increase our

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manufacturing costs, cause us to lose revenue or market share as patients and physicians turn to competing therapeutics, diminish our profitability or damage our reputation.

Such developments could increase our manufacturing costs, cause us to lose revenue or market share as patients and physicians turn to competing therapeutics, diminish our profitability or damage our reputation.

In addition, although we have business continuity plans to reduce the potential for manufacturing disruptions or delays and reduce the severity of a disruptive event, there is no guarantee that these plans will be adequate, which could adversely affect our business and operations.

Management, personnel and other organizational changes may disrupt our operations, and we may have difficulty retaining personnel or attracting and retaining qualified replacements on a timely basis for the management and other personnel who may leave the Company.

Changes in management, other personnel and our overall retention rate may disrupt our business, and any such disruption could adversely affect our operations, programs, growth, financial condition or results of operations.

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Qualified individuals are in high demand, and we may incur significant costs to attract or retain them.

We may face difficulty in attracting and retaining talent for a number of reasons, including management changes, integration related to the Reata acquisition, the underperformance or discontinuation of one or more marketed, pre-clinical or clinical programs, recruitment by competitors or changes in the overall labor market.

We may face difficulty in attracting and retaining talent for a number of reasons, including management changes, integration related to the Reata and HI-Bio acquisitions, the underperformance or discontinuation of one or more marketed, pre-clinical or clinical programs, recruitment by competitors or changes in the overall labor market.

In addition, changes in our organizational structure or in our flexible working arrangements could impact employees' productivity and morale as well as our ability to attract, retain and motivate employees.

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If we, or our vendors or donation recipients, are found to fail to comply with relevant laws, regulations or government guidance in the operation of these or other patient assistance programs, we could be subject to significant fines or penalties.

Risks relating to compliance with laws and regulations may be heightened as we continue to expand our global operations and enter new therapeutic areas with different patient populations, which may have different product distribution methods, marketing programs or patient assistance programs from those we currently utilize or support.

Risks relating to compliance with laws and regulations may be heightened as we continue to expand our global operations and enter new therapeutic areas with different patient populations, which

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may have different product distribution methods, marketing programs or patient assistance programs from those we currently utilize or support.

Conditions and regulations governing the health care industry are subject to change, with possible retroactive effect, including:

• new laws, regulations or judicial decisions, or new interpretations of existing laws, regulations or judicial decisions, related to health care availability, pricing or marketing practices, compliance with employment practices, method of delivery, payment for health care products and services, compliance with health information and data privacy and security laws and regulations, tracking and reporting payments and other transfers of value made to physicians and teaching hospitals, extensive anti-bribery and anti-corruption prohibitions, product serialization and labeling requirements and used product take-back requirements;

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• changes in the FDA and foreign regulatory approval processes or perspectives that may delay or prevent the approval of new products and result in lost market opportunity;

• changes in the FDA and foreign regulatory approval processes, staffing, resources or perspectives that may delay or prevent the approval of new products and result in lost market opportunity;

• government shutdowns or relocations may result in delays to the review and approval process, slowing the time necessary for new drug candidates to be reviewed and/or approved, which may adversely affect our business;

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• changes in FDA and foreign regulations that may require additional safety monitoring, labeling changes, restrictions on product distribution or use or other measures after the introduction of our products to market, which could increase our costs of doing business, adversely affect the future permitted uses of approved products or otherwise adversely affect the market for our products.

Additionally, conditions and regulations governing the health care industry in the U.S.

are subject to greater risk of change and uncertainty as a result of changes in legislative and regulatory priorities and personnel.

Violations of governmental regulation may be punishable by criminal and civil sanctions, including fines and civil monetary penalties and exclusion from participation in government programs, including Medicare and Medicaid, as well as against executives overseeing our business.

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• increased cost of goods due to factors such as inflation and supply chain disruptions;

• additional complexity in manufacturing internationally, including materials manufactured in China;

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• additional complexity in manufacturing or conducting clinical research internationally, including materials manufactured in China or working with CROs in China;

• delays in clinical trials relating to geopolitical instability related to Russia's invasion of Ukraine and the military conflict in the Middle East;

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• the imposition of governmental controls;

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• diverse data privacy and protection requirements;

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laws and regulations;

• the far-reaching anti-bribery and anti-corruption legislation in the U.K., including the U.K.

• the anti-bribery and anti-corruption legislation across the globe, including the U.K.

Bribery Act 2010, and elsewhere and escalation of investigations and prosecutions pursuant to such laws;

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If our employees, agents, distributors, collaborators or third-party providers are found to have engaged in such practices, we could suffer severe penalties and may be subject to other liabilities, which could negatively affect our business, operating results and financial condition.

We built a large-scale biologics manufacturing facility and are building a gene therapy manufacturing facility, which will result in the incurrence of significant investment with no assurance that such investment will be recouped.

We built a large-scale biologics manufacturing facility and are building a gene therapy, clinical packaging and other manufacturing facility, which will result in the incurrence of significant investment with no assurance that such investment will be recouped.

In order to support our future growth and drug development pipeline, we have expanded our large molecule production capacity by building a large-scale biologics manufacturing facility in Solothurn, Switzerland with no assurance that the additional capacity will be required or this investment will be recouped.

Although the Solothurn facility was approved by the FDA for ADUHELM and LEQEMBI, there can be no assurance that the regulatory authorities will approve the Solothurn facility for the manufacturing of other products.

Additionally, we are building a new gene therapy manufacturing facility in RTP, North Carolina with no assurance that this investment will be fully utilized.

If we are unable to fully utilize this gene therapy manufacturing facility, charges from excess capacity may occur and would have a negative effect on our financial condition and results of operations.

Although the Solothurn facility was approved by the FDA for LEQEMBI, there can be no assurance that the regulatory authorities will approve the Solothurn facility for the manufacturing of other products.

Additionally, we are building a new gene therapy, clinical packaging and other manufacturing facility in RTP, North Carolina with no assurance that this investment will be fully utilized.

If we are unable to fully utilize this gene therapy, clinical packaging and other manufacturing facility, charges from excess capacity may occur and would have a negative effect on our financial condition and results of operations.

If we are unable to fully utilize our manufacturing facilities, our business may be harmed.

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Third-parties might illegally distribute and sell counterfeit or unfit versions of our products, which do not meet our rigorous manufacturing, distribution and testing standards.

A patient who receives a counterfeit or unfit drug may be at risk for a number of dangerous health consequences.

A patient who receives a counterfeit or unfit drug may be

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at risk for a number of dangerous health consequences.

Our reputation and business could suffer harm as a result of counterfeit or unfit drugs sold under our brand name.

Inventory that is stolen from warehouses, plants or while in-transit, and that is subsequently improperly stored and sold through unauthorized channels, could adversely impact patient safety, our reputation and our business.

The increasing use of social media platforms and artificial intelligence based software presents new risks and challenges.

The increasing use of social media platforms presents new risks and challenges.

Social media is increasingly being used to communicate about our products and the diseases our therapies are designed to treat.

Social media practices in the biopharmaceutical industry continue to evolve and regulations relating to such use are not always clear and create uncertainty and risk of noncompliance with regulations applicable to our business.

For example, patients may use social media channels to comment on the effectiveness

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of a product or to report an alleged adverse event.

For example, patients may use social media channels to comment on the effectiveness of a product or to report an alleged adverse event.

When such disclosures occur, there is a risk that we fail to monitor and comply with applicable adverse event reporting obligations or we may not be able to defend the company or the public's legitimate interests in the face of the political and market pressures generated by social media due to restrictions on what we may say about our products.

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If any of these events were to occur or we otherwise fail to comply with applicable regulations, we could incur liability, face restrictive regulatory actions or incur other harm to our business.

Additionally, the use of AI based software is increasingly being used in the biopharmaceutical industry.

Use of AI based software may lead to the release of confidential proprietary information which may impact our ability to realize the benefit of our intellectual property.

Risks Related to Holding Our Common Stock

Our operating results are subject to significant fluctuations.

Our quarterly revenue, expense and net income (loss) have fluctuated in the past and are likely to fluctuate significantly in the future due to the risks described in these Risk Factors as well as the timing of charges and expense that we may take.

Our quarterly revenue, expense and net income have fluctuated in the past and are likely to fluctuate significantly in the future due to the risks described in these Risk Factors as well as the timing of charges and expense that we may take.

We have recorded, or may be required to record, charges that include:

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We may decide to consolidate or co-locate certain aspects of our business operations or dispose of one or more of our properties, some of which may be located in markets that are experiencing high vacancy rates and decreasing property values.

If we determine that the fair value of any of our owned properties is lower than their book value, we may not realize the full investment in these properties and incur significant impairment charges or additional depreciation when the expected useful lives of certain assets have been shortened due to the anticipated closing of facilities.

If we determine that the fair value of any of our owned properties is lower than their book value, we may not realize the full investment in these properties and incur significant

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impairment charges or additional depreciation when the expected useful lives of certain assets have been shortened due to the anticipated closing of facilities.

If we decide to fully or partially vacate a property, we may incur significant cost, including facility closing costs, employee separation and retention expense, lease termination fees, rent expense in excess of sublease income and impairment of leasehold improvements and accelerated depreciation of assets.

Any of these events may have an adverse impact on our results of operations.

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Our investment portfolio is subject to market, interest and credit risk that may reduce its value.

We maintain a portfolio of marketable securities for investment of our cash as well as investments in equity securities of certain biotechnology companies.

Changes in the value of our investment portfolio could adversely affect our earnings.

The value of our investments may decline due to, among other things, increases in interest rates, downgrades of the bonds and other securities in our portfolio, negative company-specific news, biotechnology market sentiment, instability in the global financial markets that reduces the liquidity of securities in our portfolio, declines in the value of collateral underlying the securities in our portfolio and other factors.

Each of these events may cause us to record charges to reduce the carrying value of our investment portfolio or sell investments for less than our acquisition cost.

Although we attempt to mitigate these risks through diversification of our investments and continuous monitoring of our portfolio's overall risk profile, the value of our investments may nevertheless decline.

There can be no assurance that we will continue to repurchase shares or that we will repurchase shares at favorable prices.

From time to time our Board of Directors authorizes share repurchase programs.

The amount and timing of share repurchases are subject to capital availability and our determination that share repurchases are in the best interest of our shareholders and are in compliance with all respective laws and our applicable agreements.

Our ability to repurchase shares will depend upon, among other factors, our cash balances and potential future capital requirements for strategic transactions, our results of operations, our financial condition and other factors beyond our control that we may deem relevant.

Additionally, the recently enacted IRA includes an excise tax on share repurchases, which will increase the cost of share repurchases.

A reduction in repurchases under, or the completion of, our share repurchase programs could have a negative effect on our stock price.

We can provide no assurance that we will repurchase shares at favorable prices, if at all.

We may not be able to access the capital and credit markets on terms that are favorable to us.

We may not be able to access the capital and credit markets on favorable terms, which could increase our financing costs.

We may seek access to the capital and credit markets to supplement our existing funds and cash generated from operations for working capital, capital expenditure and debt service requirements and other business initiatives.

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• limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate, thereby placing us at a disadvantage compared to our competitors that have less debt.

Our investment portfolio is subject to market, interest and credit risk that may reduce its value.

We maintain a portfolio of marketable securities for investment of our cash as well as investments in equity securities of certain biotechnology companies.

Changes in the value of our investment portfolio has in the past and may in the future adversely affect our earnings.

Each of these events may cause us to record charges to reduce the carrying value of our investment portfolio or sell investments for less than our acquisition cost.

There can be no assurance that we will repurchase shares or that we will repurchase shares at favorable prices, which may negatively affect our stock price.

From time to time our Board of Directors authorizes share repurchase programs.

Additionally, the recently enacted IRA includes an excise tax on share repurchases, which will increase the cost of share repurchases.

A reduction in repurchases under, or the completion of, our share repurchase programs could have a negative effect on our stock price.

We can provide no assurance that we will repurchase shares at favorable prices, if at all.

Some of our collaboration agreements contain change in control provisions that may discourage a third-party from attempting to acquire us.

Some of our collaboration agreements include change in control provisions that could reduce the potential acquisition price an acquirer is willing to pay or discourage a takeover attempt that could be viewed as beneficial to shareholders.

Upon a change in control, some of these provisions could trigger reduced milestone, profit or royalty payments to us or give our collaboration partner rights to terminate our collaboration agreement, acquire operational control or force the purchase or sale of the programs that are the subject of the collaboration.

Upon a change in control, some of these provisions could trigger reduced milestone, profit or royalty

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payments to us or give our collaboration partner rights to terminate our collaboration agreement, acquire operational control or force the purchase or sale of the programs that are the subject of the collaboration.

General Risk Factors

Our effective tax rate fluctuates, and we may incur obligations in tax jurisdictions in excess of accrued amounts.

Our effective tax rate fluctuates, and we may incur obligations in tax jurisdictions in excess of accrued amounts in our financial statements.

As a global biopharmaceutical company, we are subject to taxation in numerous countries, states and other jurisdictions.

As a result, our effective tax rate is derived from a combination of applicable tax rates, including

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withholding taxes, in the various places that we operate.

As a result, our effective tax rate is derived from a combination of applicable tax rates, including withholding taxes, in the various places that we operate.

In preparing our financial statements, we estimate the amount of tax that will become payable in each of such places.

Our effective tax rate may be different than experienced in the past or our current expectations due to many factors, including changes in the mix of our profitability from country to country, the results of examinations and audits of our tax filings, adjustments to the value of our uncertain tax positions, interpretations by tax authorities or other bodies with jurisdiction, the result of tax cases, changes in accounting for income taxes and changes in tax laws and regulations either prospectively or retrospectively and the effects of the integration of Reata.

and Switzerland, and regulations (including the Global Tax Deal Executive Order issued on January 20, 2025) either prospectively or retrospectively and the effects of the integrations of Reata and HI-Bio.

Our inability to secure or sustain acceptable arrangements with tax authorities and future changes in the tax laws, among other things, may result in tax obligations in excess of amounts accrued in our financial statements.

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Many countries have or are in the process of enacting legislation intended to implement the OECD GloBE Model Rules effective on January 1, 2024.

The impact on the Company will depend on the timing of implementation, the exact nature of each country's GloBE legislation, guidance and regulations thereon and their application by tax authorities either prospectively or retrospectively.

Our business involves environmental risks, which include the cost of compliance and the risk of contamination or injury.

Our business and the business of several of our strategic partners involve the controlled use of hazardous materials, chemicals, biologics and radioactive compounds.

The impact on the Company will depend on the timing of implementation, the exact nature of each country's GloBE legislation, guidance and regulations (including the Global Tax Deal Executive Order issued on January 20, 2025) thereon and their application by tax authorities either prospectively or retrospectively.

Our business involves environmental and operational risks, which include the cost of compliance and the risk of contamination or injury.

Our business and the business of several of our strategic partners involve the controlled use of hazardous materials, chemicals, biologics and radioactive compounds which make us subject to changing and evolving rules and interpretations, which could require us to incur substantial costs associated with compliance or to alter one or more of our business practices.

Although we believe that our safety procedures for handling and disposing of such materials comply with state, federal and foreign standards, there will always be the risk of accidental contamination or injury.

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If we do not obtain appropriate permits, including permits for sufficient quantities of water and wastewater, we could incur significant costs and limits on our manufacturing volumes that could harm our business.

Additionally, regulators are considering new environmental disclosure rules.

For example, the SEC and other regulators are considering environmental disclosure rules and California enacted new environmental disclosure laws in October 2023 that will generally require additional disclosure and reporting by 2026.

The new California laws, the Climate Corporate Data Accountability Act and the Climate-Related Financial Risk Act, each impose additional climate-related reporting requirements on large companies conducting business in the state of California.

We expect to be subject to these new laws, which impose extensive reporting obligations about greenhouse gas emissions and climate-related financial risks.

These recently enacted and proposed regulations may require us to incur compliance and disclosure costs and require management attention.

Additionally, regulators have passed new environmental disclosure rules.

For example, the E.U., California and certain other countries we do business in have promulgated new climate disclosure rules that will generally require additional disclosure.

Additionally, other regulators are considering environmental disclosure rules.

These new rules collectively will impose additional disclosure requirements relating to climate-related risks and emissions disclosures.

We expect to be subject to these new laws and regulations if or when they go into effect, which would impose extensive reporting obligations about greenhouse gas emissions and climate-related financial risks.

These recently enacted and proposed regulations may require us to incur compliance and disclosure costs and will likely require substantial management attention.

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 1A. Risk Factors