What changed in this filing

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Item 7. Management’s Discussion and Analysis

2026-02-06 compared with 2025-02-12 · 428 added, 416 removed, 491 unchanged (63% of the section changed)

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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.

We market the first and only drug approved in the U.S.

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

We market the first and only drug approved in the U.S., the E.U.

and certain international markets for the treatment of FA 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, external collaborations and acquisitions.

Our marketed products include TECFIDERA, VUMERITY, AVONEX, PLEGRIDY and TYSABRI for the treatment of MS;

Our marketed products include VUMERITY, TYSABRI, TECFIDERA, AVONEX and PLEGRIDY for the treatment of MS;

SPINRAZA for the treatment of SMA;

SKYCLARYS for the treatment of FA;

QALSODY for the treatment of ALS;

and FUMADERM for the treatment of severe plaque psoriasis.

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 QALSODY for the treatment of ALS.

We also have collaborations with Eisai on the commercialization of LEQEMBI for the treatment of Alzheimer's disease and Supernus on the commercialization of ZURZUVAE for the treatment of PPD.

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;

GAZYVA for the treatment of CLL and follicular lymphoma;

GAZYVA for the treatment of CLL, follicular lymphoma and, following its approval in October 2025, lupus nephritis;

OCREVUS for the treatment of PPMS and RMS;

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IMRALDI, an adalimumab biosimilar referencing HUMIRA;

FLIXABI, an infliximab biosimilar referencing REMICADE;

and BYOOVIZ, a ranibizumab biosimilar referencing LUCENTIS, in certain international markets, as well as TOFIDENCE, a tocilizumab biosimilar referencing ACTEMRA, in the U.S.

and certain international markets.

We also have commercialization rights related to OPUVIZ, an aflibercept biosimilar referencing EYLEA.

On July 2, 2024, we completed the acquisition of HI-Bio.

As a result of this transaction we acquired HI-Bio's lead asset, felzartamab, an anti-CD38 antibody currently being evaluated for three leading indications, AMR, PMN and IgAN.

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

and FLIXABI, an infliximab biosimilar referencing REMICADE.

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

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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 SWISSMEDIC and was placed into service.

The second manufacturing suite, which was also licensed to operate by SWISSMEDIC, became operational in the first quarter of 2024.

Solothurn has been approved for the manufacture of LEQEMBI.

The Solothurn facility is operational and has been approved for the manufacture of LEQEMBI and TYSABRI.

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

The plant represents a significant increase in our overall manufacturing capacity.

Additionally, we continue to invest to modernize, automate and support the capacity requirements for our pipeline and existing products at our existing manufacturing facilities in RTP.

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.

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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 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.

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

We are defending the validity of our EP 2 653 873 patent related to TECFIDERA and expiring in 2028 in opposition proceedings in the European Patent Office.

We are also engaged in litigation in Europe to defend and enforce national counterparts of our EP 2 653 873 patent, with mixed results.

In November 2025 the Technical Boards of Appeal of the European Patent Office revoked our EP 2 653 873 patent related to TECFIDERA, after which we stopped enforcing this patent and its national counterparts.

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

A biosimilar entrant of TYSABRI was approved in the U.S.

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

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, tariffs, 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.

CURRENT ECONOMIC CONDITIONS

Economic conditions remain vulnerable as markets continue to be impacted in part by elevated inflation, higher interest rates, adverse weather events, global supply chain uncertainties and risks associated with geopolitical conflicts.

ADVERSE WEATHER EVENTS

Adverse weather conditions, including hurricanes, earthquakes, wildfires and natural disaster damage, may affect our ability to do business.

We currently have operations in RTP, North Carolina, which were not impacted by recent hurricanes.

GLOBAL SUPPLY CHAIN DISRUPTIONS

Global supply chain disruptions, such as strikes, work stoppages, port congestion, port closures and other logistical problems, may affect our ability to do business.

For example, in 2024 major port strikes on the East and Gulf Coasts of the U.S.

resulted in delayed cargo movement for several days.

As our primary shipping method for resources and finished goods is through air freight, the recent port strikes did not impact our business;

however, we will continue to assess any future port disruptions and if necessary, work to secure alternative transportation.

GEOPOLITICAL TENSIONS

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, affect our ability to do business.

For example, tensions between China and Taiwan and tensions between the U.S.

We expect the future sales of TYSABRI will continue to be adversely affected by the entrance of this biosimilar.

We review our goodwill for impairment annually, as of October 31, and whenever events or changes in circumstances indicate that the carrying value of the goodwill may not be recoverable.

As part of this analysis, we compare the fair value of our one reporting unit to its carrying value through the assessment of qualitative, and, if necessary, quantitative factors.

If the carrying value of the net assets assigned to the reporting unit exceeds the fair value of our reporting unit, we will record an impairment loss equal to the difference.

As of our most recent annual impairment analysis, we had no accumulated impairment losses related to goodwill.

An interim goodwill impairment test based on quantitative factors may be required if adverse events indicate an impairment might be present.

We monitor changes to our stock price between annual impairment tests, and we believe that general deterioration in macroeconomic and industry-specific conditions may not be indicators of a goodwill impairment, as such conditions may not represent a significant adverse change to our underlying operating performance, cash flows, financial condition or liquidity.

Should our market capitalization decline below the carrying value of our net assets for a sustained period, we would consider the length and severity of the decline and the reason for the decline when assessing whether potential goodwill impairment exists.

For additional information on goodwill, please read Note 7, Intangible Assets and Goodwill , to our consolidated financial statements included in this report.

INTERNATIONAL TRADE

Global disputes and interruptions in international relationships, including tariffs, trade protection measures, embargoes, import or export licensing requirements and the imposition of trade sanctions or similar restrictions, may affect our ability to do business and the costs that we incur in providing products to our patients.

has imposed a baseline tariff on imports from all countries, subject to certain exceptions.

Trade-related 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, retaliatory tariffs imposed by China on U.S.

imports, as well as other business restrictions, with additional restrictive measures being proposed.

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We, and the pharmaceutical industry, utilize China-based partners for certain raw materials, ingredients and components for our pharmaceutical products and their delivery devices.

Engaging alternative suppliers may involve seeking additional regulatory approvals and be costly in terms of time and resources needed.

For example, certain early processes related to our acquired SKYCLARYS product rely on a single supplier based in China.

We are continuing to evaluate SKYCLARYS' supply chain and prioritizing actions to mitigate risks associated with its manufacturing and our ability to supply patients.

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

on imports from China and retaliatory tariffs imposed by China on U.S.

Secretary of Commerce has further initiated an investigation to determine the effects on the national security of imports of pharmaceuticals and pharmaceutical ingredients, including finished drug products, medical countermeasures, critical inputs such as active pharmaceutical ingredients, key starting materials and derivative products of those items, under Section 232 of the Trade Expansion Act of 1962.

There is a high degree of uncertainty concerning what future steps countries and economic blocs will take in response to changes in global trade rules and economics.

We have a significant manufacturing presence in the U.S.

While our portfolio is evolving, approximately three quarters of our 2025 U.S.

product revenue was attributable to products which were largely manufactured in the U.S.

However, we, and the pharmaceutical industry, do utilize partners and production facilities located outside the U.S.

for certain raw materials, ingredients, processes and components for our pharmaceutical products and their delivery devices.

Engaging alternative suppliers may involve seeking additional regulatory approvals and incurring additional costs and risks associated with new suppliers.

This may be costly in terms of time and resources needed or result in delays.

Key products that are currently manufactured mainly outside the U.S.

are TECFIDERA, VUMERITY and LEQEMBI.

In 2024 we initiated a technology transfer process to enable us to manufacture LEQEMBI in the U.S., which was approved in January 2026.

Although certain starting materials for SKYCLARYS rely on a single supplier based in China, the manufacturing process, including active pharmaceutical ingredients and drug substance, is primarily conducted in the U.S.

We are working to mitigate potential exposure from tariffs across our network.

As of the date of this filing, we do not expect the tariffs currently applicable to our business to result in a material adverse effect on our operations in 2026.

This is based on existing tariffs either in place or potential tariffs as previously announced by the U.S.

Administration, our manufacturing footprint, and our inventory levels and positioning.

Should significant additional tariffs be enacted, our business could be impacted in the future and differ materially from our current expectations.

We will continue to monitor the current and future global tariff landscape as it evolves.

GEOPOLITICAL TENSIONS

The ongoing geopolitical tensions related to Russia's invasion of Ukraine and the military conflict in the Middle East and other global geopolitical developments 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 manufacturing materials to Russia may delay or limit our ability to get new products approved.

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 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.

We will continue to monitor the ongoing conflict between Russia and Ukraine as well as the military conflict in the Middle East and other global geopolitical developments 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, 2025, 2024 and 2023.

Additionally, revenue generated from sales in the broader Middle East region represents less than 2.0% of total revenue for the years ended December 31, 2025, 2024 and 2023.

INFLATION REDUCTION ACT OF 2022

FACTORS AFFECTING PHARMACEUTICAL PRICING AND OTHER DEVELOPMENTS

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

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In April 2024 CMS informed us that we qualified for the specified manufacturer exception pertaining to the Medicare Part D redesign.

We expect the IRA's drug pricing controls and Medicare Part D redesign may have an adverse impact on our sales, particularly for our products that are more substantially reliant on Medicare reimbursement.

We anticipate the IRA Medicare Part D redesign will have a modest net unfavorable impact to our 2025 revenue, ranging from approximately $50.0 million to $100.0 million, concentrated in our SKYCLARYS and MS portfolio product revenue, approximately a third of which could be associated with SKYCLARYS.

The degree of impact from this legislation on our business depends on a number of forthcoming implementation actions by regulatory authorities, the full extent of the IRA's impacts on our sales and, in turn, our business, remains unclear.

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The IRA's drug pricing controls and Medicare Part D redesign had an adverse impact on our sales, particularly for our products that are more substantially reliant on Medicare reimbursement.

The IRA Medicare Part D redesign had a

modest net unfavorable impact to our 2025 revenue of approximately $90.0 million, concentrated in our SKYCLARYS and MS portfolio product revenue, approximately a quarter of which was associated with SKYCLARYS.

The degree of impact from this legislation on our business depends on a number of forthcoming implementation actions by regulatory authorities, which may be further impacted by other legislative acts that may modify or replace the IRA, such as the OBBBA, as discussed below.

The full extent of the IRA's impacts on our sales and, in turn, our business, remains uncertain.

Additionally, in May 2025 the U.S.

government issued an executive order aiming to establish an MFN drug pricing policy that would tie U.S.

drug prices to the prices paid for drugs in other developed countries.

If HHS sets MFN pricing targets for prescription drugs, including the use of international reference pricing to set drug prices in the U.S., it could result in reduced prices and reimbursement for certain of the Company's products in the U.S.

We continue to evaluate the potential impact of this executive order.

This executive order and any additional legislation, regulations or initiatives related to drug pricing, such as the CMS-proposed MFN initiatives, the Global Benchmark for Efficient Drug Pricing for certain Medicare Part B drugs and the Guarding U.S.

Medicare Against Rising Drug Costs for certain Medicare Part D drugs, could create additional uncertainty around the timing and prioritization around worldwide commercial efforts and adversely impact our business and results of operations.

2025 LEGISLATION AND TAX REFORM

On July 4, 2025, the U.S.

signed into law the H.R.1 legislation formally titled "An Act to Provide for Reconciliation Pursuant to Title II of H.

14", commonly referred to as the OBBBA.

The OBBBA contains tax provisions, such as the permanent extension or revision of certain expiring provisions of the Tax Cuts and Jobs Act enacted in 2017, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions.

The provisions of the OBBBA have multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027.

The OBBBA did not result in any material adjustments to our total income tax provision for the year ended December 31, 2025, and we have adjusted our deferred tax balances to reflect the impacts of the OBBBA enactment.

However, given the complexity of tax laws, related regulations and interpretations, our current estimates may require revision as additional information becomes available regarding the application of the OBBBA provisions.

The OBBBA also enacts significant potential changes to Medicaid funding and rescinds or does not continue elements of the PPACA.

The OBBBA implements additional eligibility rules on government health plans, expands administrative procedures around enrollment, modifies how states can obtain federal funding for Medicaid and no longer extends ACA premium subsidies.

Additional federal and state guidance is expected to be issued in order to implement these OBBBA provisions, most of which have effective dates in 2027 and 2028.

At this time, we are unable to determine the overall impact that the OBBBA will have on our business, results of operations and financial condition, or the impact the OBBBA will have on the pharmaceutical industry as a whole because any such impact will depend upon developing interpretations of the OBBBA provisions and implementing regulations, which may be material.

FINANCIAL HIGHLIGHTS

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• Rare disease revenue increased $166.1 million, or 8.4%

• The decrease in MS product revenue was primarily due to a decrease in Interferon demand due to competition as patients transition to higher efficacy therapies and a decrease in global TYSABRI revenue driven by increased competition.

• The increase in rare disease product revenue in 2024 was primarily due to revenue from new product launches, including global SKYCLARYS revenue of $382.5 million, $72.2 million for ZURZUVAE and $32.4 million for QALSODY.

This was partially offset by a decrease in rest of world SPINRAZA revenue driven by the loss of an annual tender in Russia which resulted in an unfavorable impact of approximately $45.0 million.

The decrease was also impacted by the timing of SPINRAZA shipments and the unfavorable impact of foreign currency exchange.

• The decrease in MS product revenue was primarily due to a decrease in global TECFIDERA and TYSABRI demand due to increased competition outside the U.S.

from generic and biosimilar competition, respectively, partially offset by an increase in demand for U.S.

MS product revenue in the U.S.

also benefited from favorable commercial mix and approximately $47.6 million of favorable changes in estimates from discounts and allowances.

• The increase in rare disease product revenue was primarily due to our new product launches, including global SKYCLARYS revenue of $520.5 million and global QALSODY revenue of $86.9 million in 2025.

• ZURZUVAE revenue of $195.1 million in 2025 was driven by the continued launch in the U.S.

TOTAL COST AND EXPENSE

$564.2 million or 7.3%

• Cost of sales decreased $223.0 million, or 8.8%

• Cost of sales increased $93.8 million, or 4.1%

• R&D expense decreased $201.7 million, or 10.2%

• SG&A expense decreased $146.0 million, or 5.7%

• Amortization and impairment of acquired intangible assets increased $206.1 million, or 85.7%

• The decrease in cost of sales was primarily due to favorable product mix from lower contract manufacturing revenue and lower idle capacity charges, partially offset by approximately $181.5 million in SKYCLARYS amortization costs.

• The decrease in R&D expense was primarily driven by approximately $197.0 million of equity-based compensation expense recognized in 2023 related to our Reata acquisition, cost-reduction measures realized in 2024 in connection with our portfolio prioritization initiatives and our Fit for Growth program, as well as higher spend on clinical trials and close out costs incurred during 2023, partially offset by approximately $48.5 million in SKYCLARYS amortization costs and approximately $42.5 million of equity-based compensation expense recognized in 2024 related to our HI-Bio acquisition.

• The decrease in SG&A expense was primarily due to approximately $196.4 million of equity-based compensation expense recognized in 2023 related to our Reata acquisition.

• The increase in amortization and impairment of acquired intangible assets was primarily due to amortization for the acquired intangible assets associated with SKYCLARYS, as well as impairment charges of approximately $60.2 million during 2024.

• SG&A expense increased $29.9 million, or 1.2%

• Acquired IPR&D, upfront and milestone expense increased $410.3 million

• Impairment of ROU asset of $52.9 million

• The increase in cost of sales was primarily due to a charge recorded during 2025 of approximately $104.9 million related to a litigation matter and product mix, including higher contract manufacturing revenue driven by the timing of batch releases.

• The decrease in R&D expense was primarily driven by continued cost reduction measures realized in connection with our portfolio prioritization initiatives and our Fit for Growth program, offset in part by higher spend on clinical trials, including litifilimab and felzartamab.

Higher clinical trial spend related to litifilimab was offset by $200.0 million in R&D funding received from Royalty Pharma in 2025.

• The increase in SG&A expense was primarily due to an increase in operational spending on sales and marketing activities in support of LEQEMBI and SKYCLARYS as we continue to expand our U.S.

and international product launches.

• The increase in acquired IPR&D, upfront and milestone expense was primarily due to higher upfront and milestone payments incurred during 2025 compared to 2024.

• OIE includes higher litigation related expense in 2025 compared to 2024.

In 2025 we recorded $139.5 million related to various litigation matters, including our agreement in principle to resolve all claims relating to Biogen's acquisition of Convergence.

• Impairment of ROU asset reflects an impairment charge recorded in 2025 of approximately $52.9 million related to our Reata lease.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

• Cash and cash equivalents totaled approximately $2.4 billion as of December 31, 2024, compared to approximately $1.0 billion as of December 31, 2023.

• We generated approximately $2,875.5 million of net cash flow from operations for the year ended December 31, 2024.

• We received a net cash payment of $88.6 million from the sale of our rare pediatric disease PRV in 2024.

• In April 2024 we received $437.5 million from Samsung BioLogics related to the sale of our equity interest in Samsung Bioepis.

• In July 2024 we completed the acquisition of HI-Bio for $1.15 billion, which was funded through available cash on hand.

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• Cash, cash equivalents and marketable securities totaled approximately $4.2 billion as of December 31, 2025, compared to approximately $2.4 billion as of December 31, 2024.

• We generated approximately $2.2 billion of net cash flow from operations during 2025, compared to approximately $2.9 billion in 2024.

• The year-over-year reduction in net cash flow from operations was due in part to higher worldwide tax payments in 2025 of approximately $864.0 million driven by the timing of estimated payments.

• In May 2025 we issued our 2025 Senior Notes for an aggregate principal amount of $1.75 billion.

In June 2025 we used the net proceeds to redeem our 4.050% Senior Notes due September 15, 2025.

RECENT DEVELOPMENTS

ACQUISITIONS AND DIVESTITURES

HUMAN IMMUNOLOGY BIOSCIENCES

On July 2, 2024, we completed the acquisition of all of the issued and outstanding shares of HI-Bio, a privately-held clinical-stage biotechnology company focused on targeted therapies for patients with severe immune-mediated diseases.

HI-Bio's lead asset, felzartamab, an anti-CD38 antibody, is currently being evaluated for three leading indications, AMR, PMN and IgAN.

Felzartamab has received Breakthrough Therapy Designation and ODD from the FDA for development in the treatment of PMN and AMR.

Subsequent to our acquisition, felzartamab received ODD in the E.U.

in IgAN and solid organ transplantation.

The acquisition of HI-Bio is expected to augment our pipeline and build on our expertise in immunology.

Under the terms of this acquisition, we paid shareholders of HI-Bio approximately $1.15 billion at closing and may pay up to an additional $650.0 million in potential future development and regulatory milestone payments.

We funded this acquisition through available cash on hand and accounted for this acquisition as a business combination using the acquisition method of accounting in accordance with ASC Topic 805, Business Combinations , and recorded assets acquired and liabilities assumed at their respective fair values as of the acquisition date.

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

SALE OF PRIORITY REVIEW VOUCHER

In April 2024 we completed the sale of our rare pediatric disease PRV, generated by the development associated with SPINRAZA, to a third party.

In consideration for the PRV we received a cash payment of $103.0 million upon the closing of the PRV purchase, of which approximately $14.4 million was paid to Ionis.

Our net portion of approximately $88.6 million was recognized in gain on sale of priority review voucher, net within our consolidated statements of income for the year ended December 31, 2024.

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

ALCYONE THERAPEUTICS, INC.

In November 2025 we completed the acquisition of all of the issued and outstanding shares of Alcyone Therapeutics, Inc., a clinical-stage biotechnology company focused on pediatric care through precision CNS therapeutics and dosing platforms.

Alcyone's lead asset is ThecaFlex DRx, an implantable subcutaneous port and catheter device being investigated for the intrathecal delivery of ASOs, including SPINRAZA, which is designed to provide an alternative to repeat lumbar punctures in chronic intrathecal administration of medicines.

Total consideration for this transaction, which was recorded in acquired in-process research and development, upfront and milestone expense in our consolidated statements of income for the year ended December 31, 2025, was approximately $85.0 million, comprising a $50.0 million payment made upon closing and a $35.0 million payment that was considered probable as of December 31, 2025, and made upon FDA approval of a supplemental application in January 2026.

We may pay additional development and regulatory milestone payments to the former shareholders of Alcyone of up to a total of $75.0 million if approval is received for ThecaFlex DRx administration of SPINRAZA or other additional pipeline products.

We accounted for this transaction as an asset acquisition as the value being acquired primarily relates to a single asset.

U nder the terms of this acquisition, we will oversee the end-to-end development, manufacturing and commercialization of ThecaFlex DRx .

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

COLLABORATIVE AND OTHER RELATIONSHIPS

DAYRA THERAPEUTICS, INC.

COLLABORATION

In October 2025 we entered into a research collaboration with Dayra to discover and develop oral macrocyclic peptides for priority targets in immunological conditions.

Under the terms of this agreement, both companies will collaborate to identify, validate and optimize oral macrocycle candidates for high-priority immunological targets, with our company advancing the molecules through further development and potential commercialization, including manufacturing.

In connection with the closing of this transaction we made an upfront payment of $50.0 million to Dayra, which was recognized in acquired in-process research and development, upfront and milestone expense within our consolidated statements of income for the year ended December 31, 2025.

This agreement also provides us with the option to acquire the development candidates from Dayra, subject to additional payments per program.

Dayra will also be eligible to receive potential preclinical and clinical development milestone payments per program.

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

VANQUA BIO, INC.

COLLABORATION

In October 2025 we entered into a license agreement with Vanqua granting us exclusive worldwide rights to further develop, manufacture and commercialize Vanqua's preclinical oral C5aR1 antagonist compound.

In connection with the closing of this transaction we made an upfront payment of $70.0 million to Vanqua, which was recognized in acquired in-process research and development, upfront and milestone expense within our consolidated statements of income for the year ended December 31, 2025.

We may pay Vanqua potential development, regulatory or commercial, and sales milestone payments of up to $135.0 million, $295.0 million and $560.0 million, respectively, if all the specified milestones set forth in this collaboration are achieved.

In addition, we may pay Vanqua tiered royalties on potential net sales of any licensed product under this collaboration in the mid-single digit to low-double digit percentages.

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

CITY THERAPEUTICS, INC.

COLLABORATION

In May 2025 we entered into a strategic research arrangement with City Therapeutics to develop select novel RNAi therapies.

Through this arrangement, City Therapeutics will leverage its next-generation RNAi engineering technologies to develop an RNAi trigger molecule (or molecules) combined with our proprietary drug delivery technology.

The collaboration will initially focus on a single target that mediates key CNS diseases, utilizing tissue enhanced delivery technologies with the aim of allowing for systemic administration of medicines.

We will be responsible for IND-enabling studies and global clinical development along with any regulatory submissions and all activities related to commercialization, including manufacturing.

In connection with the closing of this transaction we made an upfront payment of $16.0 million to City Therapeutics, which was recognized in acquired in-process research and development, upfront and milestone expense within our consolidated statements of income for the year ended December 31, 2025 , and invested $30.0 million in exchange for a City Therapeutics convertible note, representing a minority equity interest in City Therapeutics, if converted.

This convertible note was recorded as a component of investments and other assets within our consolidated balance sheets as of December 31, 2025.

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

STOKE THERAPEUTICS, INC.

COLLABORATION

In February 2025 we entered into a collaboration and license agreement with Stoke to co-develop and commercialize zorevunersen, an investigational ASO that targets the SCN1A gene for the potential treatment of Dravet syndrome, a rare form of genetic epilepsy associated with refractory seizures and neurodevelopmental impairments.

Zorevunersen dosed its first patient in August 2025, advancing zorevunersen to a global Phase 3 trial.

Under the terms of this agreement, Stoke will continue to lead global development and retain exclusive development and commercialization rights for zorevunersen in the U.S., Canada and Mexico and we will have exclusive rights to commercialize zorevunersen in the rest of the world.

In connection with the closing of this transaction we made an upfront payment of $165.0 million to Stoke, which was recognized in acquired in-process research and development, upfront and milestone expense within our consolidated statements of income for the year ended December 31, 2025.

We also have an exclusive option to license certain future follow-on ASO products targeting the SCN1A gene in all territories worldwide other than the U.S., Canada and Mexico, in exchange for separate milestone, cost sharing and royalty considerations.

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

ROYALTY PHARMA FUNDING ARRANGEMENT

In February 2025 we entered into a funding agreement with Royalty Pharma under which we received $200.0 million in 2025 and will receive up to $50.0 million in 2026 to co-fund our development costs for the litifilimab program.

As there is a substantive transfer of risk to the financial partner for the amount invested, the development funding will be recognized by us as an obligation to perform contractual services.

This funding is being recognized as a reduction to research and development expense within our consolidated statements of income, proportionate to the related expense.

For the year ended December 31, 2025 , we recorded a reduction to research and development e xpense of $200.0 million within our consolidated statements of income.

If the litifilimab clinical trials are successful for the indications based on the applicable clinical trials, upon regulatory approval in the U.S.

or certain major markets in the world, Royalty Pharma will be eligible to receive approval-based fixed milestone payments of up to $250.0 million.

The milestone payments due upon approval will be recorded as a component of other (income) expense, net within our consolidated statements of income, when incurred.

If litifilimab receives regulatory approval, Royalty Pharma will be eligible to receive royalties of a mid-single digit percentage of the applicable net sales.

Royalties on net sales will be recorded as cost of sales within our consolidated statements of income.

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

DEVELOPMENTS IN KEY COLLABORATIVE RELATIONSHIPS

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consisted of the following:

• In January 2026 the FDA accepted for review the supplemental BLA for LEQEMBI subcutaneous autoinjector, LEQEMBI IQLIK, for weekly starting dose, with a PDUFA action date of May 24, 2026.

• In August 2025 the FDA approved the BLA for LEQEMBI subcutaneous autoinjector, LEQEMBI IQLIK, for weekly maintenance dosing.

• In January 2025 the FDA approved LEQEMBI monthly IV maintenance dosing for the treatment of early Alzheimer's disease.

• In January 2025 the FDA accepted for review the BLA for LEQEMBI subcutaneous autoinjector for weekly maintenance dosing, with a PDUFA action date set for August 31, 2025.

• In July 2024 Eisai presented new clinical data from the CLARITY AD study open-label extension of LEQEMBI, demonstrating that three years of continuous LEQEMBI treatment reduced clinical decline, resulting in a clinically meaningful benefit for early Alzheimer's disease patients.

Rest of World

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

• In January 2025 we and Eisai announced an update regarding the ongoing regulatory review of the MAA for lecanemab in the E.U., which the CHMP of the EMA previously adopted a positive opinion on in November 2024.

The EC has asked the CHMP to consider information on the safety of lecanemab that became available after the adoption of the CHMP opinion in November 2024 and whether this may require an update of the opinion, and to consider whether the wording of the risk minimization measures in the opinion is clear enough to ensure correct implementation.

These will be discussed at the CHMP meeting in February 2025.

• In December 2024 LEQEMBI was approved by the Federal Commission for the Protection Against Sanitary Risk in Mexico.

• In November 2024 we and Eisai announced the launch of LEQEMBI in South Korea, which had been approved by the Ministry of Food and Drug Safety in South Korea in May 2024.

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• In October 2024 the Therapeutic Goods Administration of Australia issued a public statement about the initial decision not to register lecanemab.

In December 2024 Eisai submitted a request for reconsideration of this decision.

• In August 2024 LEQEMBI was approved by the Medicines and Healthcare products Regulatory Agency in Great Britain and by the Ministry of Health and Prevention in the United Arab Emirates.

• In July 2024 LEQEMBI was approved in Hong Kong and Israel.

• In June 2024 we and Eisai announced the launch of LEQEMBI in China, which had been approved by the NMPA in China in January 2024.

• In January 2026 the BLA for LEQEMBI subcutaneous autoinjector was accepted for review by the NMPA in China.

• In November 2025 Eisai filed an NDA for LEQEMBI in Japan seeking approval for a subcutaneous autoinjector as a new route of administration to Japan's Pharmaceuticals and Medical Devices Agency.

• In November 2025 the MHRA in the UK approved LEQEMBI monthly IV maintenance dosing for the treatment of early Alzheimer's disease.

• In October 2025 Health Canada issued a Notice of Compliance with Conditions for LEQEMBI for the treatment of adult patients with a clinical diagnosis of mild cognitive impairment or mild dementia due to Alzheimer's disease who are either apolipoprotein E ε4 non-carriers or heterozygotes and who have confirmed amyloid pathology.

• In September 2025 the National Medical Products Administration in China approved LEQEMBI monthly IV maintenance dosing for the treatment of early Alzheimer's disease.

• In September 2025 the Therapeutic Goods Administration of Australia approved LEQEMBI for adults who are either apolipoprotein E ε4 non-carriers or heterozygous carriers.

• In June 2025 we filed a request for arbitration in the International Court of Arbitration of the International Chamber of Commerce seeking adoption of a budget and commercialization plan for the European Territory that allocates commercialization activities to Biogen and Eisai in an equitable fashion taking into account our respective capabilities and provides a meaningful role for each party.

• In April 2025 the EC approved LEQEMBI in the E.U.

for the treatment of adult patients with a clinical diagnosis of mild cognitive impairment and mild dementia due to Alzheimer's disease who are apolipoprotein E ε4 non-carriers or heterozygotes with confirmed amyloid pathology.

ZURZUVAE (zuranolone)

• In September 2025 the EC approved ZURZUVAE in the E.U.

for the treatment of PPD in adults following childbirth, offering the first and only treatment indicated for PPD in the E.U.

• In August 2025 the Medicines and Healthcare products Regulatory Agency in the U.K.

granted marketing authorization for ZURZUVAE for moderate to severe PPD in the U.K.

SALANERSEN (BIIB115)

• In June 2025 we announced positive interim topline results from the Phase 1b study of salanersen, an ASO being developed for the treatment of SMA.

Interim Phase 1b data shows children with SMA previously treated with gene therapy experienced a substantial slowing of neurodegeneration and clinically meaningful improvements in motor function following initiation of salanersen.

Our Phase 3 registrational study of salanersen is expected to begin in 2026.

OTHER KEY DEVELOPMENTS

In October 2024 the FDA granted felzartamab Breakthrough Therapy Designation for the treatment of late AMR without T-cell mediated rejection in kidney transplant patients.

Additionally, felzartamab was granted ODD in the E.U.

in IgAN and solid organ transplantation in November 2024 and December 2024, respectively.

UCB COLLABORATION

In September 2024 we and UCB announced positive topline data from the Phase 3 PHOENYCS GO study of dapirolizumab pegol, a novel Fc-free anti-CD40L drug candidate, in people living with moderate-to-severe SLE.

The Phase 3 study met the primary endpoint demonstrating clinical improvement in moderate-to-severe SLE with clinical improvements observed among key secondary endpoints.

Based on these results, UCB and Biogen initiated a second Phase 3 study in late 2024.

• In June 2025 we announced the initiation of dosing in the global Phase 3 PREVAIL study.

This study will evaluate the efficacy and safety of the investigational drug felzartamab compared to placebo on proteinuria and preservation of kidney function in adults diagnosed with IgAN.

In connection with the initiation of this dosing we paid a $30.0 million milestone payment to MorphoSys in July 2025.

Additionally, in June 2025 we announced the initiation of dosing in the global Phase 3 PROMINENT study.

This study will evaluate the efficacy and safety of the investigational drug felzartamab compared to tacrolimus in adults diagnosed with PMN.

• In March 2025 we announced the initiation of dosing in the global Phase 3 TRANSCEND study.

This study will evaluate the efficacy and safety of the investigational drug felzartamab compared to placebo in adult kidney transplant recipients diagnosed with AMR.

In connection with the initiation of this dosing we paid a $35.0 million milestone payment to MorphoSys in April 2025.

SPINRAZA (nusinersen)

In September 2024 we announced positive topline data from the Phase 2/3 DEVOTE study of nusinersen, which evaluated the safety and efficacy of a higher dose regimen of nusinersen in treatment-naive symptomatic infants with SMA.

In January 2025 the FDA accepted the supplemental NDA and the EMA validated the application for a higher dose regimen of nusinersen for SMA.

The higher dose regimen of nusinersen comprises a more rapid loading regimen, two 50 mg-doses 14 days apart, and higher maintenance regimen, 28 mg, every four months, compared to the currently approved dose of SPINRAZA.

• In January 2026 the EC granted marketing authorization for a high dose regimen of SPINRAZA in the E.U.

for the treatment of 5q SMA, which is the most common form of the disease and represents approximately 95% of all SMA cases.

The high dose regimen is comprised of 50 mg/5 mL and 28 mg/5 mL doses and individuals transitioning from the 12 mg dose will receive one 50 mg dose in place of their next 12 mg dose, followed by 28 mg maintenance doses every four months thereafter.

• In September 2025 the high dose regimen of SPINRAZA was approved by the Ministry of Health, Labour and Welfare in Japan.

• In September 2025 the FDA issued a CRL for the supplemental NDA for a higher dose regimen of nusinersen for the treatment of SMA.

The CRL requested an update to the technical information to be included in the Chemistry Manufacturing and Controls module of the supplemental NDA and did not cite any deficiencies in the clinical data of the high dose regimen.

We resubmitted the supplemental NDA to the FDA, which has been accepted for review with a PDUFA action date of April 3, 2026.

SKYCLARYS (omaveloxolone)

• In June 2025 we announced the initiation of dosing in the global Phase 3 BRAVE study.

This study will evaluate the efficacy and safety of omaveloxolone in children with FA between the ages of two and sixteen.

• In April 2025 SKYCLARYS was approved by the Medicines and Healthcare products Regulatory Agency in the U.K.

and in Brazil.

In March 2025 SKYCLARYS was approved by Health Canada.

QALSODY (tofersen)

• In July 2025 the Medicines and Healthcare products Regulatory Agency in the U.K.

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

• In March 2025 Health Canada issued marketing authorization with conditions for QALSODY for the treatment of ALS in adults who have a mutation in the SOD1 gene.

The authorization is conditional, pending the results of trials to verify its clinical benefit.

• In April 2025 the FDA granted Fast Track designation to BIIB080, an investigational ASO therapy targeting tau for the potential treatment of Alzheimer's disease.

CORPORATE MATTERS

2025 SENIOR NOTES

On May 12, 2025, we issued senior unsecured notes for an aggregate principal amount of $1.75 billion.

In June 2025 we used the net proceeds from the sale of our 2025 Senior Notes to redeem our 4.050% Senior Notes due September 15, 2025, prior to maturity.

For additional information relating to our 2025 Senior Notes, please read Note 13, Indebtedness , to our consolidated financial statements included in this report.

NEW CORPORATE HEADQUARTERS LEASE

In March 2025 we entered into a lease agreement with MIT Investment Management Company and BioMed Realty for the lease of approximately 580,000 square feet of office and research and development space located at 75 Broadway, Cambridge, Massachusetts, which will be used as our new global corporate headquarters, as well as integrating our research and development and technical operations teams alongside our North American commercial organization.

As part of a multi-year real estate consolidation plan that is expected to result in a reduction of approximately 40% of our real estate footprint in Massachusetts, this new lease is intended to replace two existing leases, both in Cambridge, Massachusetts, including our current corporate headquarters.

We expect the initial lease term of approximately 15.5 years to commence on May 31, 2028.

For additional information on our lease agreement, please read Note 12, Leases, to our consolidated financial statements included in this report.

DISCONTINUED PROGRAMS AND STUDIES

SAGE COLLABORATION

In October 2024 we and Sage agreed to not pursue further development of zuranolone for the potential treatment of MDD.

This decision was based on the significant new investment and time we expect would be needed to conduct the additional studies required to support approval of this indication.

In July 2024 we and Sage announced that the Phase 2 KINETIC 2 dose-range study of BIIB124 did not meet its endpoints.

Based on these results, we discontinued our further development of BIIB124 and terminated our rights under the collaboration and license agreement specific to BIIB124, effective February 17, 2025.

SAMSUNG BIOEPIS 2019 DEVELOPMENT AND COMMERCIALIZATION AGREEMENT

In October 2024 we notified Samsung Bioepis of our decision to terminate our 2019 Development and Commercialization Agreement (the DCA Agreement) solely within the U.S.

Biogen will transfer commercialization rights for BYOOVIZ and OPUVIZ in the U.S.

and Canada back to Samsung Bioepis over a period of up to 18 months.

During this transition period, we will continue to commercialize BYOOVIZ.

The termination does not impact the other markets in the DCA Agreement.

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IONIS COLLABORATION

In May 2024 we and Ionis announced that the Phase 1/2 ALSpire study of BIIB105, an investigational ASO for the potential treatment of ALS, did not meet its endpoints.

Based on these results, we discontinued our further development of BIIB105.

In May 2024 we announced that we have elected not to exercise our option to license and lead development of BIIB121, an ASO for the potential treatment of Angelman syndrome.

MERZ THERAPEUTICS (PREVIOUSLY ACORDA THERAPEUTICS, INC.)

In January 2024 we notified Acorda of our decision to terminate our collaboration and license agreement, effective January 1, 2025, whereby Acorda regained global commercialization rights to FAMPYRA.

On April 1, 2024, Acorda filed for bankruptcy protection and announced its intention to sell substantially all of Acorda's assets to a third party.

On July 10, 2024, Merz Therapeutics announced that its subsidiary Merz Pharmaceuticals LLC had completed the acquisition of FAMPYRA, and related assets from Acorda.

We are now working with Merz Therapeutics on the transition of global commercialization rights of FAMPYRA and we expect to recognize minimal revenue in 2025.

SALE OF TOFIDENCE

In March 2025 we completed the sale of our regulatory and commercial rights in the U.S.

for TOFIDENCE, a tocilizumab biosimilar referencing ACTEMRA, to Organon.

Under the terms of this transaction, we received a payment of approximately $51.0 million in July 2025 a nd recognized a de minimis loss within our consolidated statements of income for the year ended December 31, 2025.

For additional information on our sale of TOFIDENCE, please read Note 3, Dispositions , to our consolidated financial statements included in this report.

SALE OF BYOOVIZ AND OPUVIZ RIGHTS

In October 2025 we completed the sale of our remaining commercial rights to two ophthalmology assets in Europe:

BYOOVIZ, a ranibizumab biosimilar referencing LUCENTIS, and OPUVIZ, an aflibercept biosimilar referencing EYLEA.

Samsung Bioepis will have full responsibility for commercialization of BYOOVIZ upon the transfer of commercial rights from Biogen back to Samsung Bioepis, which became effective as of January 2026.

Under the terms of this transaction, we received a payment of $28.0 million in November 2025 and recognized a minimal gain on disposal within our consolidated statements of income for the year ended December 31, 2025.

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

BIIB143 (cemdomespib)

In early 2025 we discontinued further development of BIIB143 (cemdomespib) for the treatment of diabetic neuropathic pain, as part of our ongoing pipeline prioritization efforts.

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In early 2025 we discontinued further development of BIIB143 (cemdomespib) for the treatment of DPN, as part of our ongoing pipeline prioritization efforts.

FELZARTAMAB - LUPUS NEPHRITIS

In November 2025 we discontinued the open label Phase 1b study of felzartamab for the treatment of lupus nephritis.

RESULTS OF OPERATIONS

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Biosimilars 729.1 793.1 770.0 (8.1) 3.0 (64.0) 23.1

82.5 11.8 13.0 599.2 (9.2) 70.7 (1.2)

197.2 82.5 11.8 139.0 nm 114.7 70.7

Total product revenue, net $ 7,119.4 $ 7,213.5 $ 7,246.7 (1.3) % (0.5) % $ (94.1) $ (33.2)

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

during the fourth quarter of 2023.

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nm Not meaningful

(1) Other includes ZURZUVAE, FUMADERM and ADUHELM.

MULTIPLE SCLEROSIS

• Global TYSABRI revenue decreased $161.9 million, from $1,876.9 million in 2023 to $1,715.0 million in 2024, or 8.6%, primarily due to increased competition and a decrease in pricing in rest of world TYSABRI.

• Global TECFIDERA revenue decreased $45.4 million, from $1,012.5 million in 2023 to $967.1 million in 2024, or 4.5%, 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 $137.7 million, from $1,105.7 million in 2023 to $968.0 million in 2024, or 12.5%, driven by a decrease is demand as patients transition to higher efficacy therapies.

• Global VUMERITY revenue increased $51.7 million, from $576.3 million in 2023 to $628.0 million in 2024, or 9.0%, primarily due to an increase in global demand.

• Global VUMERITY revenue increased $118.8 million, from $628.0 million in 2024 to $746.8 million in 2025, or 18.9%, primarily due to an increase in global demand and a favorable change in estimate of approximately $20.3 million related to rebates and discounts in the U.S., partially offset by charges related to the IRA redesign.

• Global TYSABRI revenue decreased $49.6 million, from $1,715.0 million in 2024 to $1,665.4 million in 2025, or 2.9%, primarily due to increased competition in rest of world, including the impacts from a biosimilar entrant of TYSABRI in Europe.

• Global Interferon revenue decreased $22.4 million, from $968.0 million in 2024 to $945.6 million in 2025, or 2.3%, driven by a decrease in demand as patients transition to higher efficacy therapies, offset in part by a favorable change in estimate of approximately $19.3 million related to rebates and discounts in the U.S.

• Global TECFIDERA revenue decreased $287.4 million, from $967.1 million in 2024 to $679.7 million in 2025, or 29.7%, driven by a decrease in global demand as a result of multiple TECFIDERA generic entrants.

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

Effective January 1, 2025, our collaboration and license agreement for FAMPYRA global commercialization rights was terminated.

We expect to recognize minimal revenue in 2025.

In 2026 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 expect TECFIDERA revenue will be adversely impacted by accelerating generic competition in certain markets in the E.U.

Additionally, a biosimilar entrant of TYSABRI was approved in the U.S.

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

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SPINRAZA revenue increased $15.2 million, from $610.5 million in 2023 to $625.7 million in 2024, or 2.5%, primarily due to favorable net pricing, offset by a decrease in demand.

• Rest of world SPINRAZA revenue decreased $183.2 million, from $1,130.7 million in 2023 to $947.5 million in 2024, or 16.2%, primarily driven by the loss of an annual tender in Russia which resulted in an unfavorable impact of approximately $45.0 million.

The decrease was also impacted by the timing of shipments and the unfavorable impact of foreign currency exchange.

• Global SKYCLARYS revenue was $382.5 million in 2024, including $301.1 million of U.S.

SKYCLARYS revenue, which we began recognizing during the fourth quarter of 2023, subsequent to our acquisition of Reata, and $81.4 million of rest of world SKYCLARYS revenue, which was approved in the E.U.

and became commercially available during the first quarter of 2024.

• Global QALSODY revenue was $32.4 million in 2024.

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

during the second quarter of 2023 and commercially available in the E.U.

during the second quarter of 2024, and SKYCLARYS, 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.

SKYCLARYS was also approved in the E.U.

and became commercially available during the first quarter of 2024.

In 2025 we expect growth in rare disease revenue as we continue to launch SKYCLARYS in the U.S.

We anticipate global SPINRAZA revenue to be relatively flat in 2025.

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• For 2024 compared to 2023, the increase in biosimilar revenue was primarily due to an increase in sales volumes related to BENEPALI, partially offset by a decrease in pricing due to competitive pressures.

We expect that future sales of TYSABRI will continue to be adversely affected by the entrance of this biosimilar worldwide.

We expect the decline to be partially offset by continued increasing demand for VUMERITY.

SPINRAZA revenue decreased $0.2 million, from $625.7 million in 2024 to $625.5 million in 2025 as lower demand was mostly offset by an increase in pricing and timing of shipments.

• Rest of world SPINRAZA revenue decreased $26.2 million, from $947.5 million in 2024 to $921.3 million in 2025, or 2.8%, primarily due to lower demand and the unfavorable impact of foreign currency exchange, partially offset by a one-time VAT refund received in 2025 of approximately $18.1 million and the timing of shipments in certain rest of world markets.

• Global SKYCLARYS revenue increased $138.0 million, from $382.5 million in 2024 to $520.5 million in 2025, or 36.1%, primarily related to an increase in rest of world sales volumes driven by the continued launch in Europe and certain markets in the Middle East.

• Global QALSODY revenue increased $54.5 million, from $32.4 million in 2024 to $86.9 million in 2025, or 168.2%, primarily related to an increase in rest of world sales volumes driven by the continued launch in international markets as well as patient growth in the U.S.

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

during the second quarter of 2024, and SKYCLARYS which became commercially available in the E.U.

during the first quarter of 2024.

In 2026 we expect growth in rare disease revenue due to the continued launch of SKYCLARYS in the U.S., Europe and other international markets as well as the continued launch of QALSODY in Europe.

We anticipate global SPINRAZA revenue growth to be relatively flat in 2026.

• For 2025 compared to 2024, the decrease in biosimilar revenue was primarily due to a decrease in sales volumes, decreases in pricing due to competitive pressures in Europe and the unfavorable impact of foreign currency exchange.

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

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 became commercially available in the U.S.

during the second quarter of 2024 and approved in the E.U.

during the second quarter of 2024.

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 2025 sales.

In addition, one of our contract manufacturers for IMRALDI and BENEPALI was acquired by a third party in December 2024.

We have evaluated the impact this will have on our biosimilars business and have mitigation activities in progress designed to ensure supply continuity.

After evaluating our strategic options, we have made the decision to retain our biosimilars business.

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In 2025 we completed the sale of our rights to TOFIDENCE and BYOOVIZ.

OTHER PRODUCT REVENUE

ZURZUVAE revenue increased $122.9 million, from $72.2 million in 2024 to $195.1 million in 2025, or 170.2%, primarily due to higher demand resulting from an increase in total patients in the U.S.

We anticipate growth in U.S.

ZURZUVAE revenue as we expect total patients to continue to increase in 2026.

REVENUE FROM ANTI-CD20 THERAPEUTIC PROGRAMS

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for RITUXAN, GAZYVA and LUNSUMIO 420.2 392.0 409.4

392.0 409.4 547.0

Other revenue from anti-CD20 therapeutic programs 25.5 18.4 14.0

Total revenue from anti-CD20 therapeutic programs $ 1,860.6 $ 1,749.9 $ 1,689.6

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

during the first quarter of 2023.

ROYALTY REVENUE ON SALES OF OCREVUS

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Biogen's share of pre-tax profits $ 420.2 $ 392.0 $ 409.4

For 2024 compared to 2023, the decrease in U.S.

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

of 7.9%, resulting from competition from multiple biosimilar products, partially offset by an increase in sales volumes of GAZYVA of 11.8%.

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

For 2025 compared to 2024, the increase in our share of pre-tax profits in the U.S.

for RITUXAN, GAZYVA and LUNSUMIO was primarily due to an increase in sales volumes of GAZYVA of approximately 14.4%, partially offset by a decrease in sales volumes of RITUXAN of approximately 4.1%, resulting from competition from multiple biosimilar products.

For 2025 compared to 2024, the increase in collaboration cost and expense was primarily due to higher selling and marketing expense related to GAZYVA.

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.

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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.

B i osimilar products referencing RITUXAN have launched in the U.S and are being offered at lower prices.

This competition has had a significant adverse impact on the pre-tax profits of our collaboration arrangements with Genentech, as the sales of RITUXAN have decreased substantially compared to prior periods.

We expect that biosimilar competition will continue to increase as these products capture additional market share and that this will have a significant adverse impact on our co-promotion profits in the U.S.

in future years.

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B i osimilar products referencing RITUXAN are available in the U.S and are being offered at lower prices.

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, 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.

and royalty revenue on net sales of COLUMVI in the U.S.

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.

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during the first quarter of 2023.

For the year ended December 31, 2024, we recognized approximately $ 59.9 million of Alzheimer's collaboration revenue within our consolidated statements of income.

For the year ended December 31, 2023, our share of LEQEMBI product revenue, net, was fully offset by our share of cost of sales, including royalties, resulting in a zero net impact to Alzheimer's collaboration revenue within our consolidated statements of income.

For the years ended December 31, 2025 and 2024, we recognized Alzheimer's collaboration revenue of approximately $177.7 million and $59.9 million, respectively.

The increase was primarily due to higher sales volumes driven by the continued launch of LEQEMBI in the U.S.

and international markets and the favorable impact from the timing of shipments to China during the second quarter of 2025 as we optimized our global inventory positions.

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.

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CONTRACT MANUFACTURING REVENUE

Contract manufacturing revenue primarily reflects amounts earned under contract manufacturing agreements with our strategic customers.

For 2024 compared to 2023, the decrease in contract manufacturing revenue was primarily driven by higher volumes in 2023 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.

In addition, 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.

These batch commitments were satisfied as of December 31, 2023.

As a result, we recognized lower contract manufacturing revenue in 2024, compared to 2023, as we are no longer supplying contract manufacturing customers using Hillerød in this manner.

Contract manufacturing revenue primarily reflects amounts earned under contract manufacturing agreements with our strategic customers and batches of LEQEMBI related to our collaboration with Eisai.

For 2025 compared to 2024, the increase in contract manufacturing revenue was primarily driven by higher volumes due to the timing of batch production.

ROYALTY AND OTHER REVENUE

Royalty and other revenue primarily reflects royalty revenue on biosimilar products from our license arrangements with Samsung Bioepis and royalties we receive from net sales on products related to patents that we have out-licensed.

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

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

RESERVES FOR DISCOUNTS AND ALLOWANCES

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

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

and contains substantial drug pricing reforms.

The IRA's drug pricing controls and Medicare Part D redesign had an adverse impact on our sales, particularly for our products that are more substantially reliant on Medicare reimbursement.

The IRA Medicare Part D redesign had a

The full extent of the IRA's impacts on our sales and, in turn, our business, remains uncertain.

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

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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 2024 compared to 2023, the decrease in contractual adjustments was primarily due to lower government rebates in rest of world and biosimilars, partially offset by higher government rebates in the U.S.

For 2025 compared to 2024, the increase in contractual adjustments was primarily due to higher Medicare manufacturer reserves in the U.S.

driven by the IRA Medicare Part D redesign and higher government rebates in rest of world, offset in part by favorable changes in estimates of approximately $64.7 million primarily due to lower managed care rebates, as well as lower co-pay assistance and Medicaid rebates in the U.S.

Discounts include trade term discounts, wholesaler incentives and volume related discounts.

For 2024 compared to 2023, the increase in discounts was primarily driven by higher purchase and volume discounts for biosimilars and rest of world, as well as higher purchase discounts in the U.S.

For 2025 compared to 2024, the increase in discounts was primarily driven by higher volume discounts in the U.S.

for TYSABRI, offset by lower purchase discounts in rest of world and lower volume discounts for U.S.

Product return reserves are established for returns made by wholesalers.

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

For 2024 compared to 2023, return reserves were relatively consistent.

For 2025 compared to 2024, the decrease in returns was primarily driven by lower returns in the U.S., partially offset by higher returns in rest of world.

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

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COST AND EXPENSE

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Research and development 1,778.6 1,980.3 2,445.4 (10.2) (19.0) (201.7) (465.1)

Acquired in-process research and development, upfront and milestone expense 471.8 61.5 16.6 667.2 270.5 410.3 44.9

Selling, general and administrative 2,433.6 2,403.7 2,549.7 1.2 (5.7) 29.9 (146.0)

Amortization and impairment of acquired intangible assets 515.0 446.7 240.6 15.3 85.7 68.3 206.1

Collaboration profit sharing/(loss reimbursement) 254.4 218.8 (7.4) 16.3 nm 35.6 226.2

(Gain) loss on fair value remeasurement of contingent consideration 27.7 — (209.1) nm nm 27.7 209.1

Collaboration profit sharing/(loss reimbursement) 290.2 254.4 218.8 14.1 16.3 35.8 35.6

(Gain) loss on fair value remeasurement of contingent consideration 33.6 27.7 — 21.3 nm 5.9 27.7

Impairment of ROU asset 52.9 — — nm — 52.9 —

Restructuring charges 48.6 30.2 218.8 60.9 (86.2) 18.4 (188.6)

Gain on sale of priority review voucher, net (88.6) — — nm — (88.6) —

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

Gain on sale of priority review voucher, net — (88.6) — nm nm 88.6 (88.6)

Other (income) expense, net 305.6 343.6 315.5 (11.1) 8.9 (38.0) 28.1

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PRODUCT COST OF SALES

For 2024 compared to 2023, the decrease in product cost of sales was primarily due to favorable product mix from decreased contract manufacturing revenue and lower idle capacity charges, offset in part by approximately $181.5 million in SKYCLARYS amortization costs.

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.

For 2025 compared to 2024, the decrease in product cost of sales was primarily due to lower inventory write-offs, partially offset by product mix, including higher contract manufacturing revenue driven by the timing of batch releases and higher SKYCLARYS inventory step-up amortization costs.

Contract manufacturing revenue includes LEQEMBI inventory produced for Eisai.

Cost of sales as a percentage of revenue was adversely affected by LEQEMBI batches due to lower margins associated with this business.

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 is being amortized to cost of sales within our consolidated statements of income as the inventory is sold, which is expected to be sold over a period of approximately 4 years from the acquisition date.

This fair value step-up adjustment is being amortized to cost of sales as the inventory is sold.

We expect this amount to be fully amortized by the end of 2028.

For the years ended December 31, 2025 and 2024, amortization from the fair value step-up adjustment was approximately $216.9 million and $181.5 million, 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.

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

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Inventory amounts written down as a result of excess, obsolescence or unmarketability totaled $29.2 million, $101.9 million and $124.4 million for the years ended December 31, 2025, 2024 and 2023, respectively.

For the years ended December 31, 2024, 2023 and 2022, we recorded approximately $4.8 million, $165.2 million and $119.0 million, respectively, of aggregate gross idle capacity charges.

ROYALTY COST OF SALES

For 2024 compared to 2023 , the decrease in royalty cost of sales was primarily due to lower royalties payable associated with lower sales of SPINRAZA and TYSABRI, partially offset by higher royalties payable associated with higher sales of SKYCLARYS.

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For 2025 compared to 2024 , the increase in royalty cost of sales was primarily due to a charge recorded during 2025 of approximately $104.9 million related to a litigation matter.

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

RESEARCH AND DEVELOPMENT

Research and development expense, as a percentage of total revenue, was 18.0%, 20.5% and 24.9% for the years ended December 31, 2025, 2024 and 2023, respectively.

For 2024 compared to 2023, the decrease in research and development was primarily driven by approximately $197.0 million of equity-based compensation expense recognized in 2023 related to our acquisition of Reata, cost-reduction measures realized in 2024 in connection with our portfolio prioritization initiatives and our Fit for Growth program, as well as higher spend on clinical trials and close out costs incurred during 2023, partially offset by approximately $48.5 million of step-up amortization related to SKYCLARYS inventory and approximately $42.5 million of equity based compensation expense recognized in 2024 related to our acquisition of HI-Bio.

For 2025 compared to 2024, the decrease in research and development was primarily driven by continued cost-reduction measures realized in connection with our portfolio prioritization initiatives and our Fit for Growth program, approximately $23.9 million of step-up amortization related to SKYCLARYS inventory recorded in 2025, compared to $48.5 million in 2024, and approximately $42.5 million of equity-based compensation expense recognized in 2024 related to our acquisition of HI-Bio.

The decrease was offset in part by higher spend on clinical trials, including litifilimab and felzartamab.

Higher clinical trial spend related to litifilimab was offset by $200.0 million in research and development funding received from Royalty Pharma.

EARLY STAGE PROGRAMS

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

• advancement of BIIB059 for the treatment of CLE into late stage;

• discontinuation of BIIB143 for the treatment of diabetic neuropathic pain;

• discontinuation of BIIB121 for the treatment of Angelman syndrome;

• discontinuation of BIIB131 for the treatment of acute ischemic stroke.

• advancement of litifilimab for the treatment of CLE into late stage;

• discontinuation of BIIB105 for the treatment of ALS.

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

• development of salanersen for the treatment of SMA;

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

• development of cemdomespib for the treatment of diabetic neuropathic pain;

• development of BIIB091 for the treatment of MS.

LATE STAGE PROGRAMS

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

• 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 TOFIDENCE from late stage to marketed upon the approval of TOFIDENCE in the U.S.;

• discontinuation of BIIB093 for LHI.

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

• advancement of BIIB059 for the treatment of CLE into late stage;

• development of BIIB059 for the treatment of SLE.

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

• development of felzartamab for AMR, IgAN and PMN;

• increased spend on zorevunersen for the treatment of Dravet syndrome;

• development of litifilimab for the treatment of CLE and SLE, offset by Royalty Pharma funding of $200.0 million.

MARKETED PROGRAMS

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

• discontinuation of ADUHELM for the treatment of Alzheimer's disease;

• decreased spend on LEQEMBI for the treatment of Alzheimer's disease;

• decreased spend on ZURZUVAE for MDD.

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

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

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

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

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MILESTONE AND UPFRONT EXPENSE

Research and development expense for 2024 includes:

• $20.0 million in charges to research and development expense in connection with the upfront payment associated with entering into our collaboration with Neomorph in the fourth quarter of 2024;

• $16.0 million in charges to research and development expense in connection with milestone payments to C4;

• $12.0 million in charges to research and development expense in connection with milestone payments to Alcyone;

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

Research and development expense for 2023 includes:

• $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.

• $23.9 million of step-up amortization related to SKYCLARYS inventory recorded in 2025, compared to $48.5 million in 2024.

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

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

For 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 2023.

Excluding any milestone and upfront payments, we expect our core research and development expense to decrease in 2025, while continuing to invest in our pipeline, such as our acquisition of HI-Bio in July 2024.

This is primarily due to the continued realization of our cost savings initiatives.

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.

We expect our core research and development expense to increase slightly in 2026 with most investments in our late-stage programs.

We intend to continue committing significant resources to targeted research and development opportunities while continuing to invest in our pipeline, where there is a significant unmet need and where a drug candidate has the potential to be highly differentiated.

For additional information on our acquisitions of Reata and HI-Bio, please read Note 2, Acquisitions , to our consolidated financial statements included in this report.

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ACQUIRED IN-PROCESS RESEARCH AND DEVELOPMENT, UPFRONT AND MILESTONE EXPENSE

During the first quarter of 2025 we began presenting acquired in-process research and development, upfront and milestone expense as a separate line item in our consolidated statements of income.

Acquired in-process research and development, upfront and milestone expense includes costs incurred in connection with collaboration and license agreements such as upfront and milestone payments and, when applicable, premiums on equity securities and asset acquisitions of acquired in-process research and development, which were previously included in research and development expense.

For 2025 acquired in-process research and development, upfront and milestone expense primarily consists of the following activity:

• Upfront payment of $165.0 million made to Stoke in connection with the closing of our collaboration and license agreement;

• Total consideration, including upfront payment, of approximately $85.0 million in connection with the closing of our acquisition of Alcyone;

• Upfront payment of $70.0 million made to Vanqua in connection with the closing of our license agreement;

• Upfront payment of $50.0 million made to Dayra in connection with the closing of our research collaboration;

• Milestone payments of $35.0 million and $30.0 million to MorphoSys in connection with the first patient dosed in a Phase 3 clinical trial of felzartamab for the treatment of AMR and IgAN, respectively;

• Upfront payment of $16.0 million made to City Therapeutics in connection with the closing of our strategic research arrangement.

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

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

SELLING, GENERAL AND ADMINISTRATIVE

For 2024 compared to 2023, selling, general and administrative expense decreased by approximately 5.7% primarily due to equity-based compensation expense recognized in 2023 of approximately $196.4 million related to our acquisition of Reata.

Selling, general and administrative expense for 2024 also includes higher operational spending on sales and marketing activities in support of LEQEMBI and SKYCLARYS as we continue to expand our U.S.

and international product launches, which was partially offset by cost-reduction measures realized in connection with our Fit for Growth program.

In 2024, selling, general and administrative expense included the recognition of approximately $13.9 million in equity-based compensation expense related to our acquisition of HI-Bio that was associated with the accelerated vesting of stock options and RSUs previously granted to HI-Bio employees and required no future services to vest.

Additionally, we incurred transaction and integration-related expense of approximately $3.6 million related to our acquisition of HI-Bio.

In 2023, selling, general and administrative expense included the recognition of approximately $196.4 million in equity-based compensation expense related to our acquisition of Reata that was associated with the accelerated vesting of stock options and RSUs previously granted to Reata employees and required no future services to vest.

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

In 2023, selling, general and administrative expense also included a $31.0 million obligation to Eisai related to the termination of the co-promotion agreement for our MS products in Japan and approximately $11.5 million of accelerated depreciation.

GENERAL AND ADMINISTRATIVE EXPENSE

In 2024 compared to 2023, general and administrative expense decreased by approximately $173.2 million, or 19.6%, due to the recognition of approximately $196.4 million in equity-based compensation expense in 2023 related to our acquisition of Reata.

We expect selling, general and administrative costs to continue to decline in 2025 due to the continued realization of our cost-reduction measures in connection with our Fit for Growth program.

For additional information on our acquisitions of Reata and HI-Bio, please read Note 2, Acquisitions , to our consolidated financial statements included in this report.

For 2025 compared to 2024, selling, general and administrative expense increased by approximately 1.2% primarily due to an increase in operational spending on sales and marketing activities in support of LEQEMBI and SKYCLARYS as we continue to expand our U.S.

and international product launches.

The increase was partially offset by the realization of our cost-reduction measures in connection with our Fit for Growth program.

In 2026 we expect selling, general and administrative expense to be relatively flat as compared to 2025.

We anticipate increases in spend related to product launches and pre-launch activities will be offset by reduced spending within our mature products.

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 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 the year ended December 31, 2024 , amortization and impairment of acquired intangible assets reflects the impact of a $40.0 million impairment charge related to intangible assets from other clinical programs we acquired from Reata, reducing the remaining book value of these IPR&D intangible assets to zero, and a $20.2 million impairment charge related to intangible assets associated with Samsung Bioepis commercialization rights terminated during the third quarter of 2024.

For the year ended December 31, 2023, we had no impairment charges.

Our most significant amortizable intangible assets are related to TYSABRI, AVONEX, SPINRAZA, VUMERITY and SKYCLARYS.

Amortization of acquired intangible assets, excluding impairment charges, totaled $507.1 million, $386.5 million and $240.6 million for the years ended December 31, 2025, 2024 and 2023, respectively.

For 2024 compared to 2023, the increase in amortization of acquired intangible assets, excluding impairment charges, was primarily due to amortization for the Reata acquisition acquired intangible assets associated with SKYCLARYS.

The increase in amortization of acquired intangible assets, excluding impairment charges, was primarily due to amortization for the acquired intangible assets associated with SKYCLARYS and TYSABRI.

For the year ended December 31, 2025, amortization and impairment of acquired intangible assets reflects the impact of $7.9 million in impairment charges related to compounds acquired from HI-Bio.

For the year ended December 31, 2024, amortization and impairment of acquired intangible assets reflects the impact of a $40.0 million impairment charge related to intangible assets from other clinical programs we acquired from Reata, reducing the remaining book value of these IPR&D intangible assets to zero, and a $20.2 million impairment charge related to intangible assets associated with the termination of Samsung Bioepis' commercialization rights during the third quarter of 2024.

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.

For additional information on our 2019 Development and Commercialization Agreement with Samsung Bioepis, please read Note 19, Collaborative and Other Relationships , to our consolidated financial statements included in this report.

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COLLABORATION PROFIT SHARING/(LOSS REIMBURSEMENT)

Collaboration profit sharing/(loss reimbursement) 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 third quarter of 2023, collaboration profit sharing/(loss reimbursement) related to Sage's 50.0% share of the profit or loss in the U.S.

Collaboration profit sharing/(loss reimbursement) includes Samsung Bioepis' 50.0% share of the profit or loss related to our biosimilars 2013 commercial agreement with Samsung Bioepis and collaboration profit sharing/(loss reimbursement) related to Supernus' 50.0% share of the profit or loss in the U.S.

related to ZURZUVAE for PPD.

For the years ended December 31, 2025, 2024 and 2023, we recognized net profit-sharing expense of approximately $219.2 million, $227.4 million and $223.5 million, respectively, to reflect Samsung Bioepis' 50.0% sharing of the net collaboration profits.

For the years ended December 31, 2024 and 2023, we recognized net profit-sharing expense of approximately $27.0 million and net loss reimbursement of approximately $4.7 million, respectively, to reflect Sage's 50.0% share of net collaboration results in the U.S.

for ZURZUVAE for PPD.

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

For the years ended December 31, 2025, 2024 and 2023, we recognized net profit-sharing expense of approximately $71.0 million and $27.0 million, and net loss reimbursement of approximately $4.7 million, respectively, to reflect Supernus' 50.0% share of net collaboration results in the U.S.

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

(GAIN) LOSS ON FAIR VALUE REMEASUREMENT OF CONTINGENT CONSIDERATION

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We then revalue our contingent consideration obligations each reporting period.

Changes in the fair value of our contingent consideration obligations, other than changes due to payments, are recognized as a (gain) loss on fair value remeasurement of contingent consideration in our condensed consolidated statements of income.

Changes in the fair values of our contingent consideration obligations, other than changes due to payments, are recognized as a (gain) loss on fair value remeasurement of contingent consideration within our consolidated statements of income.

In connection with our acquisition of HI-Bio in July 2024 we recorded contingent consideration obligations related to potential milestone payments.

For the year ended December 31, 2024, the changes in the fair value of our contingent consideration obligations were primarily due to changes in interest rates used to revalue our contingent consideration liabilities, the passage of time and updates to the expected timing of achieving certain milestones which will trigger contingent consideration payments.

For the year ended December 31, 2025, changes in the fair value of our contingent consideration obligations were primarily due to changes in interest rates used to revalue our contingent consideration liabilities and the passage of time.

During the second quarter of 2025 the first milestone related to the fourth patient dosed in a Phase 3 clinical trial of felzartamab for AMR was achieved, resulting in a $150.0 million milestone payment made to the former shareholders of HI-Bio, which was paid during the third quarter of 2025.

In October 2025 the second milestone related to the fourth patient dosed in a Phase 3 clinical trial of felzartamab for IgAN was achieved, resulting in a $150.0 million milestone payment made to the former shareholders of HI-Bio, which was paid during the fourth quarter of 2025.

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

IMPAIRMENT OF RIGHT-OF-USE ASSET

As part of our acquisition of Reata, we assumed responsibility for a single-tenant, build-to-suit building of approximately 327,400 square feet of office and laboratory space located in Plano, Texas, with an initial lease term of 16 years.

We recorded a lease liability of approximately $151.8 million, with a corresponding right-of-use asset of approximately $121.2 million.

We are continuing to evaluate opportunities to sublease the property.

During the fourth quarter of 2025 we performed an impairment assessment for this right-of use asset.

This assessment involved estimating undiscounted future cash flows, including potential sublease income and remaining lease obligations.

As a result of this impairment assessment, we recorded an impairment charge of approximately $52.9 million related to this Reata lease, which is included in impairment of ROU asset within our consolidated statements of income for the year ended December 31, 2025.

For additional information on our leases, please read Note 12, Leases , to our consolidated financial statements included in this report.

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.

The Fit for Growth program is expected to generate approximately $1.0 billion in gross operating expense savings by the end of 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.

In 2023 we initiated 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 generated approximately $1.0 billion in gross operating expense savings by the end of 2025, some of which has been reinvested in various initiatives.

The Fit for Growth program included net headcount reductions of approximately 1,400 employees and we incurred total restructuring charges of approximately $320.0 million by the end of 2025.

Total charges incurred from our 2023 Fit for Growth program are summarized as follows:

For the Years Ended December 31,

(In millions) Severance Costs Accelerated Depreciation and Other Costs Total Severance

Costs Accelerated Depreciation and Other Costs Total

Selling, general and administrative $ — $ 13.8 $ 13.8 $ — $ 23.3 $ 23.3

Research and development — 11.7 11.7 — 1.2 1.2

Restructuring charges 24.2 — 24.2 153.4 34.6 188.0

Total charges $ 24.2 $ 25.5 $ 49.7 $ 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.

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REATA INTEGRATION

Following the close of our Reata acquisition in September 2023, we implemented an integration plan designed to realize operating synergies through cost savings and avoidance.

Under this initiative, we estimate we will incur total integration charges of approximately $35.0 million, related to severance and employment costs.

These severance and employment costs were substantially incurred during 2023.

Total charges incurred from our Reata integration are summarized as follows:

For the Years Ended December 31,

(In millions) Severance Costs Accelerated Depreciation and Other Costs Total Severance Costs Accelerated Depreciation and Other Costs Total

2025 2024 2023

(In millions) Severance Costs Accelerated Depreciation and Other Total Severance Costs Accelerated Depreciation and Other Total Severance Costs Accelerated Depreciation and Other Total

Selling, general and administrative $ — $ (1.4) $ (1.4) $ — $ 13.8 $ 13.8 $ — $ 23.3 $ 23.3

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Total charges $ 48.7 $ 8.7 $ 57.4 $ 24.2 $ 25.5 $ 49.7 $ 153.4 $ 59.1 $ 212.5

In connection with our acquisition of Reata we assumed responsibility for a single-tenant, build-to-suit building of approximately 327,400 square feet of office and laboratory space located in Plano, Texas, with an initial lease term of 16 years.

We do not intend to occupy this building and are evaluating opportunities to sublease the property.

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

HI-BIO INTEGRATION

Following the close of our HI-Bio acquisition in July 2024, we implemented an integration plan designed to realize operating synergies through cost savings and avoidance.

Under this initiative, we incurred approximately $2.6 million of severance and employment costs, which are reflected in restructuring charges within our consolidated statements of income for the year ended December 31, 2024 .

For additional information on our acquisition of HI-Bio, please read Note 2, Acquisitions , 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 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.

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 our consolidated financial statements included in this report.

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

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

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OTHER (INCOME) EXPENSE, NET

For 2024 compared to 2023, the change in other (income) expense, net primarily reflects lower interest income driven by lower cash balances in 2024, compared to 2023, partially offset by higher net losses on our holdings in equity securities in 2023.

NET (GAINS) LOSSES IN EQUITY SECURITIES

For the year ended December 31, 2024, net unrealized losses and realized gains on our holdings in equity securities were approximately $102.4 million and $2.0 million, respectively, compared to net unrealized and realized losses of approximately $270.0 million and $5.2 million, respectively, in 2023.

• The net unrealized losses recognized during the year ended December 31, 2024, primarily reflect a decrease in the aggregate fair value of our investments in Sage common stock of approximately $101.4 million, partially offset by an increase in the fair value of Denali and Sangamo common stock of approximately $7.5 million.

• 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.

For 2025 compared to 2024, the change in other (income) expense, net primarily reflects higher interest income in 2025 driven by higher cash balances as well as higher litigation related expense in 2025 compared to 2024.

In 2025 we recorded $139.5 million related to various litigation matters, including our agreement in principle to resolve all claims relating to Biogen's acquisition of Convergence, partially offset by higher net losses on our holdings in equity securities in 2024.

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

INTEREST INCOME AND EXPENSE

For the year ended December 31, 2024, net interest expense was approximately $182.7 million, compared to net interest income of $29.6 million in 2023.

The change was primarily due to lower interest income driven by lower cash balances in 2024, compared to 2023, due to use of cash on hand for business development transactions.

For 2025 compared to 2024, we anticipate lower net interest expense as a result of higher cash balances, somewhat offset by lower interest rates, leading to more interest income.

For the year ended December 31, 2025, net interest expense was approximately $142.5 million, compared to net interest expense of $182.7 million in 2024.

The change was primarily due to higher interest income driven by higher cash balances in 2025.

For 2026 compared to 2025, we anticipate lower net interest expense as a result of higher interest income driven by higher cash balances, partially offset by higher interest expense as a result of the issuance of our 2025 Senior Notes.

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

NET (GAINS) LOSSES IN EQUITY SECURITIES

For the year ended December 31, 2025, net unrealized and realized losses on our holdings in equity securities were approximately $18.2 million and $1.5 million, respectively, compared to net unrealized losses and realized gains of approximately $102.4 million and $2.0 million, respectively, in 2024.

• The net unrealized losses recognized during the year ended December 31, 2025, primarily reflect a decrease in the aggregate fair value of our investment in Denali common stock of approximately $27.7 million, partially offset by an increase in the fair value of Sage common stock of approximately $23.0 million.

• The net unrealized losses recognized during the year ended December 31, 2024, primarily reflect a decrease in the aggregate fair value of our investment in Sage common stock of approximately $101.4 million, partially offset by an increase in the fair value of Denali and Sangamo common stock of approximately $7.5 million.

INCOME TAX PROVISION

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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 2024 compared to 2023, the increase in our effective tax rate was partially driven by the relative deferred tax effects of the changes in the value of our equity investments and amortization of purchased intangible assets and inventory.

Further, 2023 benefited from the combined impacts of Reata acquisition-related expenses and the resolution of an uncertain tax matter related to tax credits.

This was partially offset by a 2024 benefit related to a decrease in our valuation allowance related to projected future foreign taxable income.

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

As a result of decreases in our stock price between the grant date of certain share-based compensation awards and the vesting date in 2025, we expect that we will record an income tax expense of approximately $15.0 million during the first quarter of 2025, upon the vesting of these awards.

The exact amount of the income tax expense will depend on our stock price at the time of vesting.

For 2025 compared to 2024, the increase in our effective tax rate was partially driven by changes in the territorial mix of our profitability and the impact of certain share-based compensation awards that vested during the first quarter of 2025, partially offset by the impact of the elimination of Italian withholding tax.

The OECD has issued model rules, which generally provide for a jurisdictional minimum effective tax rate of 15.0% as defined in those rules.

Various countries have or are in the process of enacting legislation intended to implement the principles effective January 1, 2024.

Our income tax provision for the year ended December 31, 2024, reflects currently enacted legislation and guidance related to the OECD model rules.

This enacted legislation and guidance related to the OECD model rules did not result in any material adjustments to our income tax provision or income tax balances as of December 31, 2024.

On January 20, 2025, the Global Tax Deal Executive Order was issued.

At this stage, we do not believe this Executive Order impacts our financial results as of December 31, 2024.

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Various countries have or are in the process of enacting legislation intended to implement the principles.

Our income tax provision for the years ended December 31, 2025 and 2024, reflects currently enacted legislation and guidance related to the OECD model rules including the Pillar Two side-by-side package announced by the OECD in January 2026.

This enacted legislation and guidance related to the OECD model rules did not result in any material adjustments to our income tax provision or income tax balances as of December 31, 2025 and 2024.

At this stage, we do not believe the side-by-side package impacts our financial results as of December 31, 2025.

2025 OBBBA TAX PROVISIONS

On July 4, 2025, the U.S.

signed into law the OBBBA.

The provisions of the OBBBA have multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027.

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.

NONCONTROLLING INTERESTS, NET OF TAX

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 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 additional information on the 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

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Cash and cash equivalents $ 3,008.5 $ 2,375.0 26.7 % $ 633.5

Total cash and cash equivalents $ 2,375.0 $ 1,049.9 126.2 % $ 1,325.1

Current portion of notes payable and term loan $ 1,748.6 $ 150.0 nm $ 1,598.6

Notes payable and term loan 4,547.2 6,788.2 (33.0) (2,241.0)

Marketable securities — current 807.2 — nm 807.2

Marketable securities — non-current 431.9 — nm 431.9

Total cash, cash equivalents and marketable securities $ 4,247.6 $ 2,375.0 78.8 % $ 1,872.6

Current portion of notes payable $ — $ 1,748.6 nm $ (1,748.6)

Notes payable 6,286.8 4,547.2 38.3 1,739.6

Total borrowings $ 6,286.8 $ 6,295.8 (0.1) % $ (9.0)

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nm Not meaningful

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

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.

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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 July 2, 2024, we completed the acquisition of all of the issued and outstanding shares of HI-Bio.

Under the terms of this acquisition, we paid shareholders of HI-Bio approximately $1.15 billion as well as an additional $43.7 million related to working capital adjustments as of the transaction close date.

These amounts were funded through available cash on hand.

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

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

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

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WORKING CAPITAL

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Our working capital was $5.6 billion as of December 31, 2025, compared to $1.9 billion as of December 31, 2024.

The change in working capital reflects an increase in total current assets of approximately $597.5 million and an increase in total current liabilities of approximately $2.1 billion.

The change in working capital reflects an increase in total current assets of approximately $1.5 billion and a decrease in total current liabilities of approximately $2.2 billion.

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

CURRENT ASSETS

• $1.3 billion increase in cash and cash equivalents ;

• $1.4 billion increase in cash, cash equivalents and current marketable securities ;

• $62.4 million decrease in accounts receivable, net related to our ongoing operations;

• $429.5 million decrease in other current assets primarily due to the receipt of $437.5 million from Samsung BioLogics related to the sale of our 49.9% equity interest in Samsung Bioepis.

• $292.4 million decrease in inventory primarily due to timing of production.

CURRENT LIABILITIES

• $184.1 million increase in accrued expense and other primarily due to $279.3 million of short-term contingent consideration recognized from our acquisition of HI-Bio, offset in part by the timing of our annual incentive compensation payment and other benefits-related payments;

• $1.6 billion increase in current portion of debt primarily due to the reclassification of our $1.75 billion aggregate principal amount of 4.05% Senior Notes due September 15, 2025, from long-term to short-term and the repayment of our 2023 Term Loan.

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

For additional information on the sale of our equity interest in Samsung Bioepis and the sale of our PRV, please read Note 3, Dispositions , 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.

• $1.7 billion decrease in the current portion of notes payable due to the redemption of our 4.050% Senior Notes due September 15, 2025, during the second quarter of 2025;

• $433.5 million decrease in taxes payable primarily due to the timing of tax payments.

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

CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES

As of December 31, 2024, we had cash and cash equivalents totaling approximately $2.4 billion compared to approximately $1.0 billion as of December 31, 2023.

The increase in the balance was primarily due to cash generated by our operations, the receipt of $437.5 million in April 2024 from Samsung BioLogics related to the sale of our 49.9% equity interest in Samsung Bioepis, the net cash receipt of $88.6 million from the sale of one of our two PRV's and proceeds from the sale of a portion of our Denali common stock and our remaining Sangamo common stock during 2024.

The increase was offset in part by $1.15 billion of cash and cash equivalents used to fund our acquisition of HI-Bio in July 2024 and $650.0 million of cash used for the repayment of our 2023 Term Loan.

As of December 31, 2025, we had cash, cash equivalents and marketable securities totaling approximately $4.2 billion compared to approximately $2.4 billion as of December 31, 2024.

The increase in the balance was primarily due to cash generated by our operations, which includes $200.0 million of research and development funding received from Royalty Pharma, partially offset by worldwide tax payments of approximately $864.0 million, an upfront payment made to Stoke of $165.0 million in connection with the closing of our collaboration and license agreement, milestone payments made to the former shareholders of HI-Bio totaling $300.0 million, a payment of $50.0 million in connection with our acquisition of Alcyone and total payments of $166.0 million in connection with our agreements with City Therapeutics, Dayra and Vanqua.

During the second quarter of 2025 we received $1.75 billion in net proceeds from the issuance of our 2025 Senior Notes, which was offset by a $1.75 billion payment made for the redemption of our 4.050% Senior Notes due September 15, 2025.

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.

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

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

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(In millions) 2025 2024

$ 145.8 $ 273.6

Sage 33.9 135.3

Denali $ 118.1 $ 145.8

Total $ 118.1 $ 179.7

(1) During 2024 we sold a portion of our Denali common stock and the remaining shares of our Sangamo common stock.

Our ability to liquidate our investments in Denali and Sage 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.

(1) In July 2025 Sage was acquired by Supernus.

Prior to this acquisition, we disposed of all of our shares of Sage common stock in a block trade.

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

For additional information on our 2025 Senior Notes, please read Note 13, Indebtedness , to our consolidated financial statements included in this report.

The following table summarizes our cash flow activity:

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• (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 2024 compared to 2023, the increase in net cash flow provided by operating activities was primarily due to higher net income, lower employee-benefit payments made during the first quarter of 2024, as compared to the same period in 2023, lower estimated federal tax payments made during 2024, as compared to 2023, and changes in non-cash adjustments to net income.

The increase was partially offset by the timing of working capital, which includes higher inventory levels, primarily associated with our contract manufacturing for LEQEMBI.

For 2025 compared to 2024, the decrease in net cash flow provided by operating activities was primarily due to lower net income in 2025, which included higher acquired in-process research and development, upfront and milestone payments in 2025, higher worldwide tax payments in 2025, compared to 2024, of approximately $864.0 million and $355.1 million, respectively, driven by the timing of estimated tax payments, the timing of customer payments and higher employee-benefit payments made during the first quarter of 2025, compared to the same period in 2024.

The decrease was offset in part by lower inventory levels and $200.0 million of research and development funding received from Royalty Pharma in 2025.

INVESTING ACTIVITIES

For 2024 compared to 2023, the change in net cash flow in investing activities was primarily due to cash payments made associated with our acquisition of HI-Bio in 2024 and with our acquisition of Reata in 2023.

Additionally, cash outlay in 2023 was partially offset by net proceeds received from the sale of our marketable securities.

For 2025 compared to 2024, the change in net cash flow in investing activities was primarily due to purchases of marketable securities in 2025 of $1.3 billion.

In 2024, net cash flow in investing activities included the acquisition of HI-Bio for $1.15 billion, partially offset by the receipt of $437.5 million from Samsung BioLogics related to the sale of our 49.9% equity interest in Samsung Bioepis and the net cash receipt of $88.6 million from the sale of one of our two PRVs.

FINANCING ACTIVITIES

For 2024 compared to 2023, the change in net cash flow in financing activities was primarily due to the repayment of our 2023 Term Loan for $650.0 million during 2024 compared to the issuance of term loans totaling $1.0 billion under our 2023 Term Loan which were used to partially fund our acquisition of Reata in 2023, partially offset by repayments of borrowings and debt premiums paid in 2023 totaling $809.9 million.

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

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For 2025 compared to 2024, the change in net cash flow in financing activities was primarily due to $1.75 billion in net proceeds received from the issuance of our 2025 Senior Notes, which was offset by a $1.75 billion payment made for the redemption of our 4.050% Senior Notes due September 15, 2025, as well as $300.0 million of milestone payments made to the former shareholders of HI-Bio, of which approximately $280.0 million was reflected within financing activities.

Additionally, net cash flow used in financing activities during 2024 included the repayment of our 2023 Term Loan for $650.0 million.

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

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

CAPITAL RESOURCES

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Our long-term obligations primarily consist of long-term debt related to our Senior Notes with final maturity dates ranging between 2030 and 2055.

As of December 31, 2024, our outstanding balance related to long-term debt was $4,547.2 million.

As of December 31, 2025, our outstanding balance related to long-term debt was $6.3 billion, net of discounts and debt offering costs.

2025 SENIOR NOTES

On May 12, 2025, we issued our 2025 Senior Notes for an aggregate principal amount of $1.75 billion.

In June 2025 we used the net proceeds from the sale of our 2025 Senior Notes to redeem our 4.050% Senior Notes due September 15, 2025, prior to maturity.

2023 TERM LOAN

In connection with our acquisition of Reata in September 2023 we entered into a $1.5 billion term loan credit agreement.

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All shares repurchased under our 2020 Share Repurc hase Program were retired.

There were no share repurchases of our common stock during the years ended December 31, 2024 and 2023.

There were no repurchases of our common stock during the years ended December 31, 2025 and 2024.

Approximately $2.1 billion remained available under our 2020 Share Repurchase Program as of December 31, 2025.

CAPITAL EXPENDITURES

In the fourth quarter of 2021 we began construction of a new gene therapy, clinical packaging and other 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.

We estimate the construction of this manufacturing facility will be completed during 2025.

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.

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CONTRACTUAL OBLIGATIONS AND OFF-BALANCE SHEET ARRANGEMENTS

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In addition to the minimum rental commitments, these leases may require us to pay additional amounts for taxes, insurance, maintenance and other operating expense.

(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.

(2) Obligations are presented net of sublease income expected to be received for our vacated portions of various 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.

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 2021 Exchange Offer Senior Notes, our 2020 Senior Notes and our 2015 Senior Notes, including principal and interest payments.

(4) Long-term debt obligations are related to our 2025 Senior Notes, our 2021 Exchange Offer Senior Notes, our 2020 Senior Notes and our 2015 Senior Notes, including principal and interest payments.

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 $234.0 million related to the remaining payments on the Transition Toll Tax and $11.7 million related to the fair value of net liabilities on derivative contracts.

(5) Purchase and other obligations includes approximately $58.9 million related to the fair value of net liabilities on derivative contracts.

ROYALTY PAYMENTS

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Royalty payments 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.

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 in cost of sales within 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.

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 in cost of sales within 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.

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

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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.

We make royalty payments to Alkermes on worldwide net sales of VUMERITY using a royalty rate of 15.0% on product that Alkermes has manufactured and 16.0% on product manufactured by us or a third-party designee, which are recognized as cost of sales in our consolidated statements of income.

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.

Reata entered into agreements to pay royalties on annual worldwide net sales of

SKYCLARYS, which will cumulatively range in the low to mid-single digit percentages.

Royalty payments are recognized as cost of sales in our consolidated statements of income.

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

LEASE COMMITMENTS

We expect the initial lease term of approximately 15.5 years to commence on May 31, 2028.

The estimated minimum lease payments as a result of the new lease total approximately $1.5 billion over the initial lease term.

For additional information on our leases, please read Note 12, Leases , to our consolidated financial statements included in this report.

CONTINGENT CONSIDERATION RELATED TO BUSINESS COMBINATIONS

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We recognized the contingent consideration obligations associated with this acquisition at its fair value on the acquisition date and we revalue this obligation each reporting period.

We may pay up to an additional $650.0 million in potential future development and regulatory milestone payments.

We may pay up to a total of $650.0 million in contingent development and regulatory milestone payments.

The acquisition-date fair value of these milestones was approximately $485.1 million.

We anticipate that we may trigger the first and second milestone payments of approximately $150.0 million each in 2025.

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

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

CONTINGENT DEVELOPMENT, REGULATORY AND COMMERCIAL MILESTONE PAYMENTS

Based on our development plans as of December 31, 2024, we could trigger potential future milestone payments to third parties of up to approximately $3.8 billion, including approximately $0.5 billion in development milestones, approximately $0.5 billion in regulatory milestones and approximately $2.8 billion in commercial milestones, as part of our various collaborations, including licensing and development programs and HI-Bio's pre-existing commitments, as discussed below.

Based on our development plans as of December 31, 2025, we could make potential future milestone payments to third parties of up to approximately $5.3 billion, including approximately $0.7 billion in development milestones, approximately $0.8 billion in regulatory milestones and approximately $3.8 billion in commercial milestones, as part of our various collaborations, including licensing and development programs.

Payments under these agreements generally become due and payable upon achievement of certain development, regulatory or commercial milestones.

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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 approximately $73.6 million in milestones in 2025 under our current agreements, excluding opt-in payments.

We acquired HI-Bio's pre-existing in-license commitments under third-party agreements, which include tiered royalties on potential future sales of felzartamab and izastobart/HIB210, ranging from high-single digit to mid-teen percentages, as well as potential future development, regulatory and commercial milestone payments related to felzartamab and izastobart/HIB210 of up to $130.0 million, $230.0 million and $640.0 million, respectively.

This amount includes potential milestone payments due upon the first patient dosed in a phase 3 clinical trial of felzartamab in a first and second indication of $35.0 million and $30.0 million, respectively, which we anticipate will be triggered in 2025.

If certain research milestones are met, we may pay up to approximately $67.5 million in additional milestones in 2026 under our current agreements, excluding opt-in payments.

This amount includes a $45.0 million milestone payment due upon the initiation of a Phase 3 trial of salanersen.

OTHER FUNDING COMMITMENTS

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As of December 31, 2025, we have approximately $166.8 million of liabilities associated with uncertain tax positions.

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As of December 31, 2024 and 2023, we have accrued income tax liabilities of approximately $234.0 million and $419.5 million, respectively, under the Transition Toll Tax.

The amount accrued as of December 31, 2024, is expected to be paid within one year.

The Transition Toll Tax is being paid in installments over an eight--year period, which started in 2018, and will not accrue interest.

As of December 31, 2024, we accrued income tax liabilities of approximately $234.0 million under the Transition Toll Tax, which was subsequently paid in full in April 2025.

OTHER OFF-BALANCE SHEET ARRANGEMENTS

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Product revenue is recorded net of reserves established for applicable discounts and allowances that are offered within contracts with our customers, health care providers or payors, including those associated with the implementation of pricing actions in certain of the international markets in which we operate.

Our process for

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estimating reserves established for these variable consideration components do not differ materially from our historical practices.

Our process for estimating reserves established for these variable consideration components do not differ materially from our historical practices.

Product revenue reserves, which are classified as a reduction in product revenue, are generally characterized in the following categories:

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When we purchase a business, the acquired IPR&D is measured at fair value, capitalized as an intangible asset and tested for impairment at least annually, as of October 31, until commercialization, after which time the IPR&D is amortized over its estimated useful life.

If we acquire an asset or group of assets that do not meet the definition of a business under applicable accounting standards, then the acquired IPR&D is expensed on its acquisition date.

If we acquire an asset or group of assets with no alternative future use that do not meet the definition of a business under applicable accounting standards, then the acquired IPR&D is expensed on its acquisition date.

Future costs to develop these assets are recorded to research and development expense within our consolidated statements of income as they are incurred.

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• estimating the timing of and expected costs to complete the in-process projects;

• projecting regulatory approvals;

• projecting the timing and likelihood of regulatory approvals;

• estimating future cash flow from product sales resulting from completed products and in process projects;

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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.

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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.

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Long-lived assets to be held and used include property, plant and equipment as well as intangible assets, including IPR&D and trademarks.

Property, plant and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable.

Property, plant and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable based on an estimate of undiscounted future cash flow resulting from the use of the assets and eventual disposition.

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 assess qualitative, and, if necessary, quantitative factors, and 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.

Changes in estimates and assumptions used in determining the fair value of our acquired IPR&D could result in an impairment.

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 $60.2 million for the year ended December 31, 2024, related to the impairment of other clinical programs we acquired from Reata and Samsung Bioepis commercialization rights terminated during the third quarter of 2024.

For the year ended December 31, 2023, we had no impairment charges.

Acquired IPR&D 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 $7.9 million for the year ended December 31, 2025, related to the impairment of compounds acquired from HI-Bio.

For the year ended December 31, 2024, we incurred impairment charges of approximately $60.2 million related to the impairment of other clinical programs we acquired from Reata and the termination of Samsung Bioepis' commercialization rights.

For additional information on our impairments, please read Note 7, Intangible Assets and Goodwill , to our consolidated financial statements included in this report.

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In preparing our consolidated financial statements, we estimate our income tax liability in each of the jurisdictions in which we operate by estimating our actual current tax expense together with assessing temporary differences resulting from differing treatment of items for tax and financial reporting purposes.

These differences result in

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deferred tax assets and liabilities, which are included in our consolidated balance sheets.

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 GILTI, we have included amounts related to GILTI taxes within temporary difference.

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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.

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

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