What changed in this filing

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Item 1A. Risk Factors

2023-05-04 compared with 2022-11-03 · 194 added, 230 removed, 765 unchanged (36% of the section changed)

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Please carefully consider all of the information in this Form 10-Q, including the full set of risks set forth in this "Risk Factors" section, and in our other filings with the SEC before making an investment decision regarding Regeneron.

Risks Related to the COVID-19 Pandemic

• Our business may be further adversely affected by the effects of the COVID-19 pandemic, including those impacting our manufacturing and supply chain operations, research and development efforts, commercial operations and sales force, administrative personnel, third-party service providers, and business partners and customers, as well as the demand for our marketed products.

• We face risks related to the development, manufacturing, and potential future commercialization of REGEN-COV and "next generation" monoclonal antibodies targeting SARS-CoV-2.

Commercialization Risks

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• We rely on limited internal and contracted manufacturing and supply chain capacity, which could adversely affect our ability to commercialize our products and to advance our clinical pipeline.

As we increase our production in response to higher product demand or in anticipation of a potential regulatory approval, our current manufacturing capacity will likely not be sufficient, and our dependence on our collaborators and/or contract manufacturers may increase, to produce adequate quantities of drug material for both commercial and clinical purposes.

As we increase our production in response to higher product demand or in anticipation of a potential regulatory approval, our current manufacturing capacity will

likely not be sufficient, and our dependence on our collaborators and/or contract manufacturers may increase, to produce adequate quantities of drug material for both commercial and clinical purposes.

• Expanding our manufacturing capacity and establishing fill/finish capabilities will be costly and we may be unsuccessful in doing so in a timely manner, which could delay or prevent the launch and successful commercialization of our products approved for marketing and could jeopardize our clinical development programs.

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• We have undertaken and may in the future undertake strategic acquisitions, and any difficulties from integrating such acquisitions could adversely affect our business, operating results, and financial condition.

Other Risks Factors – Risks Related to Employees, Information Technology, Financial Results and Liquidity, and Our Common Stock

Other Risks Related to Our Business and Our Common Stock

• Our business is dependent on our key personnel and will be harmed if we cannot recruit and retain leaders in our research, development, manufacturing, and commercial organizations.

• Significant disruptions of information technology systems or breaches of data security could adversely affect our business.

• Public health outbreaks, epidemics, or pandemics (such as the COVID-19 pandemic) have adversely affected and may in the future adversely affect our business.

• We may need additional funding in the future, which may not be available to us, and which may force us to delay, reduce, or eliminate our product development programs or commercialization efforts.

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• Our stock price is extremely volatile.

• Our existing shareholders may be able to exert significant influence over matters requiring shareholder approval and over our management.

Risks Related to the COVID-19 Pandemic

Our business may be further adversely affected by the effects of the COVID-19 pandemic.

In December 2019, a novel strain of coronavirus, SARS-CoV-2, causing a disease referred to as COVID-19, was reported to have surfaced in Wuhan, China.

It has since spread around the world, evolved into multiple new variants, and caused a global pandemic.

This pandemic has adversely affected and/or has the potential to adversely affect, among other things, the economic and financial markets and labor resources of the countries in which we operate;

our manufacturing and supply chain operations, research and development efforts, commercial operations and sales force, administrative personnel, third-party service providers, and business partners and customers;

and the demand for our marketed products.

The COVID-19 pandemic has resulted in the imposition of various restrictions and mandates around the world to reduce the spread of the disease, including governmental orders that direct individuals to shelter at their places of residence, direct businesses and governmental agencies to cease non-essential operations at physical locations, prohibit certain non-essential gatherings, maintain social distancing, order cessation of non-essential travel, and require proof of vaccination and/or negative COVID-19 test results.

The COVID-19 pandemic has continued to ebb and flow, with different jurisdictions having higher levels of infections than others and new variants of the SARS-CoV-2 virus (such as the Omicron-lineage variants) emerging and spreading more easily and quickly than other variants.

The trajectory and the ultimate impact of the pandemic are highly uncertain and subject to change and we do not yet know the full extent of potential delays or impacts on our business, our clinical trials, healthcare systems, or the global economy as a whole.

These effects could have a material impact on our operations.

By way of example, continuation or re-imposition of various government-imposed or private-sector measures relating to the COVID-19 pandemic (including those we previously implemented, such as work-from-home policies for some employees) may further negatively impact productivity, disrupt our business, and delay our clinical programs and development timelines beyond the delays we have already experienced and disclosed.

Such restrictions and limitations may also further negatively impact our access to regulatory authorities (which are affected, among other things, by applicable travel restrictions and may be delayed in responding to inquiries, reviewing filings, and conducting inspections);

our ability to perform regularly scheduled quality checks and maintenance;

and our ability to obtain services from third-party specialty vendors and other providers or to access their expertise as fully and timely as needed.

The COVID-19 pandemic may also result in the loss of some of our key personnel, either temporarily or permanently.

We and our employees may also be subject to government vaccine mandates, which may have a negative impact on our ability to retain employees or hire new employees and could adversely impact our business.

In addition, our sales and marketing efforts were previously negatively impacted and may be further negatively impacted by postponement or cancellation of face-to-face meetings and restrictions on access by non-essential personnel to hospitals or clinics to the extent such measures slow down adoption or further commercialization of our marketed products.

The demand for our marketed products may also be adversely impacted by the restrictions and limitations adopted in response to the COVID-19 pandemic, particularly to the extent they affect the patients' ability or willingness to start or continue treatment with our marketed products.

Any of the foregoing factors may result in lower net product sales of our marketed products.

For example, net product sales of EYLEA in the United States decreased for the three months ended June 30, 2020, compared to the same period in 2019, due in part to the impact of the COVID-19 pandemic.

See Part I, Item 2.

"Management's Discussion and Analysis of Financial Condition and Results of Operations - Results of Operations" for a discussion of our net product sales.

Demand for some or all of our marketed products may be further reduced if shelter-in-place, social distancing, or similar orders remain in effect or are re-implemented and, as a result, some of our inventory may become obsolete and may need to be written off, impacting our operating results.

These and similar, and perhaps more severe, disruptions in our operations may materially adversely impact our business, prospects, operating results, and financial condition.

Various government-imposed or private-sector measures relating to the COVID-19 pandemic (or the perception that such restrictions or limitations on the conduct of business operations could occur) previously impacted, and may impact in the future, personnel at our research and manufacturing facilities, our suppliers, and other third parties on which we rely, as well as the availability or cost of materials produced by or purchased from such parties, resulting in supply chain strains or disruptions that may become material.

While some materials and services may be obtained from more than one supplier or provider, port closures and other restrictions, whether resulting from the COVID-19 pandemic or otherwise (including any government restrictions or limitations, such as those that may be imposed under the Defense Production Act), could materially disrupt our supply chain or limit our ability to obtain sufficient materials or services (including fill/finish services) required for the development and manufacturing of our products and product candidates as well as our research efforts.

If microbial, viral (including COVID-19), or other contaminations are discovered in our products, product candidates, the materials used for their production, or in our facilities, or in the facilities of our collaborators, third-party contract manufacturers, or other providers or suppliers, the affected facilities may need to be closed or may otherwise be affected for an extended period of time, or the contamination may result in other delays or disruptions in our direct or indirect supply chain.

In addition, infections, hospitalizations, and deaths related to COVID-19 previously disrupted and may in the future disrupt the United States' healthcare and healthcare regulatory systems.

These and other possible disruptions relating to the COVID-19 pandemic could divert healthcare resources away from, or materially delay, FDA review and potential approval of our product candidates and new indications for our marketed products.

In addition, some of our clinical trials were previously and may in the future be affected by the COVID-19 pandemic.

This impact could result in further delays in site initiation and patient enrollment due to prioritization of hospital resources toward the COVID-19 pandemic, patients' inability to comply with clinical trial protocols if quarantines impede patient movement or interrupt healthcare services, and restrictions on trial initiations imposed by hospitals and other trial sites as a result of the COVID-19 pandemic.

Similarly, our ability to recruit and retain patients and principal investigators and site staff who, as healthcare providers, may have heightened exposure to COVID-19, was previously and may in the future be delayed or disrupted.

We continue to evaluate the adverse impact of the COVID-19 pandemic on an individual trial basis.

Any such disruptions may further negatively impact the progress of our clinical trials, including the readouts of trial results, the timing of regulatory review, and any anticipated program milestones.

While the potential economic impact brought by, and the duration of, the COVID-19 pandemic may be difficult to assess or predict, it previously caused significant disruption of global financial markets and could cause more economic disruption in the future, making it more difficult for us to access capital if needed.

In addition, a recession or market correction resulting from the spread of COVID-19 could materially affect our business and the value of our Common Stock.

To the extent the COVID-19 pandemic adversely affects our business, prospects, operating results, or financial condition, it may also have the effect of heightening many of the other risks described in this "Risk Factors" section.

We face risks related to the development, manufacturing, and potential future commercialization of REGEN-COV and "next generation" monoclonal antibodies targeting SARS-CoV-2.

In response to the COVID-19 pandemic, we developed REGEN-COV (known as Ronapreve in countries outside the United States), a novel investigational antibody cocktail treatment designed to prevent and treat infection from the SARS-CoV-2 virus.

REGEN-COV received an EUA from the FDA in November 2020 for the treatment of mild to moderate COVID-19 in certain patients.

However, based on laboratory data that showed markedly decreased binding to the Omicron spike protein, REGEN-COV is highly unlikely to be active against the Omicron-lineage variants.

In January 2022, the FDA revised the EUA to exclude its use in geographic regions where, based on available information including variant susceptibility and regional variant frequency, infection or exposure is likely due to a variant such as an Omicron-lineage variant that is not susceptible to the treatment.

With this EUA revision, REGEN-COV is not currently authorized for use in any U.S.

states, territories, or jurisdictions, since Omicron-lineage variants are currently dominant across the United States.

In light of these developments, we cannot predict whether (if at all) or to what extent REGEN-COV may be reauthorized or approved for use by the FDA in the future.

In July 2022, the FDA notified us that its review of the BLA for REGEN-COV to treat COVID-19 in non-hospitalized patients and as prophylaxis in certain individuals is ongoing;

it is possible that approval of this BLA may be further delayed or not granted at all.

In addition to our REGEN-COV program, we are progressing "next generation" monoclonal antibodies targeting SARS-CoV-2 (together with REGEN-COV referred to below as "our COVID-19 monoclonal antibodies").

There can be no assurance as to the timing or success of any studies evaluating "next generation" antibodies and whether any of such antibodies will retain activity against present or future variants of concern.

We also face risks related to our significant investment in the development, supply, allocation, distribution, pricing, and potential future commercialization of our COVID-19 monoclonal antibodies.

We have committed and may continue to commit significant capital and resources to fund and supply clinical trials and to accelerate and scale up the production of our COVID-19 monoclonal antibodies, which involves a complex manufacturing process that is both resource- and time-sensitive.

For example, the impact of prioritizing certain manufacturing-related resources for our COVID-19 monoclonal antibodies includes, among other things, drawing down inventory safety stock levels for certain of our other products (including Dupixent and EYLEA).

Depending on the demand for our products (including any future demand for our COVID-19 monoclonal antibodies), our ability to re-establish successfully our customary manufacturing cadence, and other relevant factors, we may not be able to replenish our inventory safety stock to the levels we deem prudent or supply our products and product candidates in sufficient quantities to satisfy our commercial and development needs.

We expect our investment in the development and manufacture of our COVID-19 monoclonal antibodies to continue through 2022 and potentially beyond, although the magnitude of our investment will be subject to clinical data results, the duration of the COVID-19 pandemic, and other factors, including regulatory outcomes.

If we are unable to obtain a new EUA for any of our "next generation" monoclonal antibodies, or obtain regulatory approvals for any of the foregoing, or if we make a strategic decision to discontinue development of, or not commercialize, our COVID-19 monoclonal antibodies or are otherwise not successful in their commercialization, we may be unable to recoup our significant expenses incurred to date and/or in the future related to the development and production of our COVID-19 monoclonal antibodies.

While we previously recognized significant revenues in connection with sales of REGEN-COV, the degree to which future sales of our COVID-19 monoclonal antibodies will continue to impact our results of operations is highly uncertain.

• Our existing shareholders may be able to exert substantial influence over matters requiring shareholder approval and over our management.

Risks Related to Commercialization of Our Marketed Products, Product Candidates, and New Indications for Our Marketed Products

We are substantially dependent on the success of EYLEA and Dupixent.

EYLEA net sales represent a substantial portion of our revenues and this concentration of our net sales in a single product makes us substantially dependent on that product.

For the nine months ended September 30, 2022 and 2021, EYLEA net sales in the United States represented 54% and 38% of our total revenues, respectively.

If we were to experience difficulty with the commercialization of EYLEA in the United States or if Bayer were to experience any difficulty with the commercialization of EYLEA outside the United States (including as a result of the COVID-19 pandemic discussed above), or if we and Bayer are unable to maintain current marketing approvals of EYLEA, we may experience a reduction in revenue and may not be able to sustain profitability, and our business, prospects, operating results, and financial condition would be materially harmed.

EYLEA net product sales represent a substantial portion of our revenues and this concentration of our net sales in a single product makes us substantially dependent on that product.

For the three months ended March 31, 2023 and 2022, EYLEA net product sales in the United States represented 45% and 51% of our total revenues, respectively.

For the three months ended March 31, 2023, EYLEA global net product sales decreased by 4%, compared to the same period in 2022, as discussed in Part I, Item 2.

"Management's Discussion and Analysis of Financial Condition and Results of Operations - Results of Operations." If we were to experience difficulty with the commercialization of EYLEA in the United States or if Bayer were to experience any difficulty with the commercialization of EYLEA outside the United States, if EYLEA net product sales experience a sustained decline in or outside the United States, or if we and Bayer are unable to maintain current marketing approvals of EYLEA, we may experience a reduction in revenue and may not be able to stay profitable at the levels we previously achieved or at all, and our business, prospects, operating results, and financial condition may be materially harmed.

In the United States, the regulatory exclusivity period for EYLEA (i.e., the period during which no biosimilar product can be approved by the FDA) will expire after May 17, 2024.

See "Risks Related to Intellectual Property and Market Exclusivity - Loss or limitation of patent rights, and regulatory pathways for biosimilar competition, could reduce the duration of market exclusivity for our products " below.

As a result, we face the risk of lower EYLEA net product sales due to biosimilar competition following such expiration, which may have a material adverse impact on our results of operations.

While we have submitted a BLA for aflibercept 8 mg with the FDA, the degree to which any future net product sales of aflibercept 8 mg (if approved) may offset any potential decrease in EYLEA net product sales, resulting from the factors discussed above or otherwise, is highly uncertain.

In addition, we are dependent on our share of profits from the commercialization of Dupixent under our Antibody Collaboration with Sanofi.

If we or Sanofi were to experience any difficulty with the commercialization of Dupixent or if we or Sanofi are unable to maintain current marketing approvals of Dupixent, we may experience a reduction in revenue and our business, prospects, operating results, and financial condition would be materially harmed.

If we or our collaborators are unable to continue to successfully commercialize our products, our business, prospects, operating results, and financial condition will be materially harmed.

We expect that the degree of commercial success of our marketed products will continue to depend on many factors, including the following (as applicable):

• the continued impact of SARS-CoV-2 (the virus that has caused the COVID-19 pandemic) on our business and the demand for our marketed products, as well as its continued impact on, among other things, our employees, collaborators, suppliers, and other third parties on which we rely, our ability to continue to manage our supply chain, and the global economy (as further discussed above under "Risks Related to the COVID-19 Pandemic - Our business may be further adversely affected by the effects of the COVID-19 pandemic ");

• effectiveness of the commercial strategy in and outside the United States for the marketing of our products, including pricing strategy;

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and, in the case of EYLEA, the existing and potential new branded and biosimilar competition for EYLEA (discussed further under " The commercial success of our products and product candidates is subject to significant competition - Marketed Products" below) and the willingness of retinal specialists and patients to start or continue treatment with EYLEA or to switch from another product to EYLEA;

• the effect of existing and new health care laws and regulations currently being considered or implemented in the United States, including price reporting and other disclosure requirements of such laws and regulations and the potential impact of such requirements on physician prescribing practices and payor coverage;

• the effect of existing and new health care laws and regulations currently being considered or implemented in the United States, including measures requiring the U.S.

government in the future to negotiate the prices of certain drugs and price reporting and other disclosure requirements and the potential impact of such requirements on physician prescribing practices and payor coverage;

• serious complications or side effects in connection with the use of our marketed products, as discussed under "Risks Related to Maintaining Approval of Our Marketed Products and the Development and Obtaining Approval of Our Product Candidates and New Indications for Our Marketed Products - Serious complications or side effects in connection with the use of our products and in clinical trials for our product candidates and new indications for our marketed products could cause our regulatory approvals to be revoked or limited or lead to delay or discontinuation of development of our product candidates or new indications for our marketed products, which could severely harm our business, prospects, operating results, and financial condition " below;

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• our ability to meet the demand for commercial supplies of our marketed products;

• the outcome of the pending proceedings relating to EYLEA, Dupixent, Praluent, and REGEN-COV (described further in Note 14 to our Condensed Consolidated Financial Statements included in this report), as well as other risks relating to our marketed products and product candidates associated with intellectual property of other parties and pending or future litigation relating thereto (as discussed under "Risks Related to Intellectual Property and Market Exclusivity" below);

• the outcome of the pending proceedings relating to EYLEA, Praluent, and REGEN-COV (described further in Note 11 to our Condensed Consolidated Financial Statements included in this report), as well as other risks relating to our marketed products and product candidates associated with intellectual property of other parties and pending or future litigation relating thereto (as discussed under "Risks Related to Intellectual Property and Market Exclusivity" below);

• the outcome of the pending government proceedings and investigations and other matters described in Note 11 to our Condensed Consolidated Financial Statements included in this report (including the civil complaint filed against us on June 24, 2020 in the U.S.

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As our currently marketed products and most of our product candidates are biologics, bringing them to market may cost more than bringing traditional, small-molecule drugs to market due to the complexity associated with the research, development, production, supply, and regulatory review of such products.

Given cost sensitivities in many health care systems (which may continue to be exacerbated as a result of the COVID-19 pandemic), our currently marketed products and product candidates are likely to be subject to continued pricing pressures, which may have an adverse impact on our business, prospects, operating results, and financial condition.

In addition, in order for private insurance and governmental payors (such as Medicare and Medicaid in the United States) to reimburse the cost of our marketed products, we must maintain, among other things, our FDA registration and our National Drug Code, formulary approval by PBMs, and recognition by insurance companies and the Centers for Medicare & Medicaid Services (the "CMS").

Given cost sensitivities in many health care systems, our currently marketed products and product candidates are

likely to be subject to continued pricing pressures, which may have an adverse impact on our business, prospects, operating results, and financial condition.

There is no certainty that we will be able to obtain or maintain the applicable requirements for reimbursement (including relevant formulary coverage, as discussed further below) of our current and future marketed products, which may have a material adverse effect on our business.

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It is likely that federal and state legislatures and health agencies will continue to focus on additional health care reform measures in the future that will impose additional constraints on prices and reimbursements for our marketed products.

this trend may be further accelerated as a result of the COVID-19 pandemic.

Further, there have been several recent U.S.

Congressional inquiries and proposed federal and state legislation and policies (in addition to those already in effect) designed to, among other things, bring more transparency to drug pricing, review the relationship between pricing and manufacturer patient programs, reduce the out-of-pocket cost of prescription drugs, and reform government program reimbursement methodologies for drugs.

Congressional inquiries and recently approved or proposed federal and state legislation and policies (in addition to those already in effect) designed to, among other things, bring more transparency to drug pricing, review the relationship between pricing and manufacturer patient programs, reduce the out-of-pocket cost of prescription drugs, and reform government program reimbursement methodologies for drugs.

Notably, the U.S.

Congress recently passed the Inflation Reduction Act (the "IRA"), which includes measures allowing the government to negotiate prices of certain prescription drugs under Medicare (including those covered under Medicare Part B, such as EYLEA and, potentially in the future, aflibercept 8 mg) and measures redesigning the Medicare Part D benefit to limit patient out-of-pocket drug costs and shift liabilities among stakeholders, including manufacturers.

While enacted into law, it is unclear how the provisions of the IRA will be implemented and the extent to which the policy changes will ultimately impact reimbursement levels of our marketed products covered under Medicare Part B (such as EYLEA) or our product candidates that may in the future be covered under Medicare Part B (such as aflibercept 8 mg).

Congress recently passed the Inflation Reduction Act ("IRA"), which includes, among other items, provisions regarding the following:

• Implementation of a Medicare Drug Price Negotiation Program (the "Medicare Drug Price Negotiation Program").

The Medicare Drug Price Negotiation Program requires the government to set prices for select high-expenditure drugs covered under Medicare Parts B and D.

In the first two years, only Part D drugs are eligible for inclusion in the Medicare Drug Price Negotiation Program.

Starting in 2026, the government is authorized to select both Part B and Part D drugs for inclusion in the Medicare Drug Price Negotiation Program, with established prices for selected drugs to go into effect in 2028 absent certain disqualifying events.

• Medicare Inflation Based Rebates .

The IRA includes measures penalizing manufacturers that raise prices of drugs covered under Medicare Parts B and D at a rate that exceeds the rate of inflation.

• Medicare Part D Program Redesign .

The IRA implements changes to the Medicare Part D benefits to limit patient out-of-pocket drug costs and shift program liabilities from patients to other stakeholders, including health plans, manufacturers, and the government.

While enacted into law, it is currently unclear how many of the provisions of the IRA (including the Medicare Drug Price Negotiation Program with respect to Part B drugs and biologics) will be implemented and the extent to which the policy changes will ultimately impact reimbursement levels of our marketed products, including those covered under Medicare Part B (such as EYLEA) or our product candidates that may be covered under Medicare Part B (such as aflibercept 8 mg) or Medicare Part D in the future.

At the state level, legislatures are becoming increasingly aggressive in passing legislation and implementing regulations designed to control pharmaceutical and biological product pricing, including price or patient reimbursement constraints, discounts, restrictions on certain product access, and price and marketing cost disclosure and transparency measures.

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If our marketed products are not included within an adequate number of formularies, adequate reimbursement levels are not provided, the eligible insured patient population for our products is limited, or a key payor refuses to provide reimbursement for our products in a particular jurisdiction altogether, this could have a material adverse effect on our and our collaborators' ability to commercialize the applicable product.

In certain foreign countries, pricing, coverage, and level of reimbursement of prescription drugs are subject to governmental control, and we and our collaborators may be unable to obtain coverage, pricing, and/or reimbursement on terms that are favorable to us or necessary for us or our collaborators to successfully commercialize our marketed products in those countries.

In many foreign countries, pricing, coverage, and level of reimbursement of prescription drugs are subject to governmental control, and we and our collaborators may be unable to obtain coverage, pricing, and/or reimbursement on terms that are favorable to us or necessary for us or our collaborators to successfully commercialize our marketed products in those countries.

In some foreign countries, the proposed pricing for a drug must be approved before it may be lawfully marketed.

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Our results of operations may suffer if we or our collaborators are unable to market our products in foreign countries or if coverage and reimbursement for our marketed products in foreign countries is limited or delayed.

As discussed below under " If we are unable to establish commercial capabilities outside the United States for Libtayo, Dupixent, or any other products we intend to commercialize or co-commercialize outside the United States, our business, prospects, operating results, and financial condition may be adversely affected, " we will need to manage these and other commercialization-related risks in order for us to successfully develop commercial capabilities outside the United States (including those necessary for our successful commercialization and co-commercialization of Libtayo and Dupixent, respectively).

The commercial success of our products and product candidates is subject to significant competition.

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There is significant actual and potential future competition for each of our marketed products.

EYLEA and (if approved) aflibercept 8 mg.

EYLEA faces and, if approved, aflibercept 8 mg will face, significant competition in the marketplace.

For example, EYLEA competes in one or more of its approved indications with other VEGF inhibitors, including Novartis and Genentech/Roche's Lucentis ® (ranibizumab), Novartis' Beovu ® (brolucizumab), and Genentech/Roche's Susvimo ® (ranibizumab ocular implant) and Vabysmo ® (faricimab-svoa), as well as biosimilar versions of Lucentis commercialized in the United States by Biogen Inc.

For example, EYLEA competes in one or more of its approved indications with other VEGF inhibitors, including Genentech/Roche's Vabysmo ® (faricimab-svoa) and Susvimo ® (ranibizumab ocular implant), Novartis and Genentech/Roche's Lucentis ® (ranibizumab), and Novartis' Beovu ® (brolucizumab), as well as biosimilar versions of Lucentis commercialized in the United States by Biogen Inc.

and Coherus BioSciences, Inc.

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In atopic dermatitis, there are topical and systemic JAK inhibitors and an antibody against IL-13 approved for atopic dermatitis and others are in development.

In addition, a number of companies are developing antibodies against IL-4Ra, IL-13Ra1, OX40(L), and/or IL-31R.

In addition, a number of companies are developing antibodies against IL-4Ra, IL-13Ra1, OX40(L), and/or IL-31R that may compete with Dupixent in atopic dermatitis and other indications (including asthma and/or prurigo nodularis), as applicable.

In asthma, competitors to Dupixent include antibodies against the IL-5 ligand or the IL-5 receptor, immunoglobulin E, or thymic stromal lymphopoietin ("TSLP");

and some of these antibodies are either approved or in development for indications that also compete or may compete in the future with Dupixent in CRSwNP and EoE.

There are several other potentially competitive products in development that may compete with Dupixent in asthma, as well as potential future indications,

including antibodies against the IL-33 ligand or receptor.

There are several other potentially competitive products in development that may compete with Dupixent in asthma, as well as potential future indications, including antibodies against the IL-33 ligand or receptor.

Dupixent also faces competition from inhaled products in asthma and potential future indications.

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There are several competitors that are marketing and/or developing antibodies against PD-1 and/or PDL-1 (some of which were approved in the relevant indications and commercialized before Libtayo), including Merck's Keytruda ® (pembrolizumab), Bristol-Myers Squibb's Opdivo ® (nivolumab), Roche's Tecentriq ® (atezolizumab), and AstraZeneca's Imfinzi ® (durvalumab).

Other marketed products.

There is also significant actual and potential future competition for other products marketed or otherwise commercialized by us and/or our collaborators under our collaboration agreements with them.

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We also rely on Sanofi for sales, marketing, and distribution of Dupixent in countries outside the United States.

While we exercised our option under the Antibody Collaboration to co-commercialize Dupixent in certain jurisdictions outside the United States and have commenced this co-commercialization in some of these jurisdictions, we will continue to rely in part on Sanofi's sales and marketing organization in such jurisdictions and there can be no assurance that we will be able to successfully conduct such co-commercialization in the expected time frame or at all.

While we exercised our option under the Antibody Collaboration to co-commercialize Dupixent in certain jurisdictions outside the United States, we will continue to rely in part on Sanofi's sales and marketing organization in such jurisdictions.

If we and our collaborators are unsuccessful in continuing to commercialize the marketed products subject to such collaborations, or if Bayer or Sanofi terminate their respective collaborations with us, our business, prospects, operating results, and financial condition would be materially impaired.

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Therefore, termination of the Bayer collaboration agreement or our Antibody Collaboration would create substantial new and additional risks to the successful commercialization of the applicable products, particularly outside the United States.

For additional information regarding our collaborations with Bayer and Sanofi, see "Risks Related to Our Reliance on or Transactions with Third Parties - If our collaboration with Bayer for EYLEA is

terminated, or Bayer materially breaches its obligations thereunder, our business, prospects, operating results, and financial condition, and our ability to continue to commercialize EYLEA outside the United States would be materially harmed " below and "Risks Related to Our Reliance on or Transactions with Third Parties - If our Antibody Collaboration with Sanofi is terminated, or Sanofi materially breaches its obligations thereunder, our business, prospects, operating results, and financial condition, and our ability to develop, manufacture, and commercialize certain of our products and product candidates in the time expected, or at all, would be materially harmed " below.

For additional information regarding our collaborations with Bayer and Sanofi, see "Risks Related to Our Reliance on or Transactions with Third Parties - If our collaboration with Bayer for EYLEA is terminated, or Bayer materially breaches its obligations thereunder, our business, prospects, operating results, and financial condition, and our ability to continue to commercialize EYLEA outside the United States would be materially harmed " below and "Risks Related to Our Reliance on or Transactions with Third Parties - If our Antibody Collaboration with Sanofi is terminated, or Sanofi materially breaches its obligations thereunder, our business, prospects, operating results, and financial

condition, and our ability to develop, manufacture, and commercialize certain of our products and product candidates in the time expected, or at all, would be materially harmed " below.

Sales of our marketed products recorded by us and our collaborators could be reduced by imports from countries where such products may be available at lower prices.

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We sell our marketed products for which we record net product sales in the United States to several distributors and specialty pharmacies, as applicable, which generally sell the product directly to healthcare providers or other pharmacies (as applicable).

For the nine months ended September 30, 2022 and 2021, our gross product sales of such products to two customers accounted on a combined basis for 85% and 53% of our total gross product revenue, respectively.

We expect significant customer

concentration to continue for the foreseeable future.

For the three months ended March 31, 2023 and 2022, our gross product sales of such products to two customers accounted on a combined basis for 77% and 85% of our total gross product revenue, respectively.

We expect significant customer concentration to continue for the foreseeable future.

Our ability to generate and grow sales of these products will depend, in part, on the extent to which our distributors and specialty pharmacies are able to provide adequate distribution of these products to healthcare providers.

Although we believe we can find additional distributors, if necessary, our revenue during any period of disruption could suffer and we might incur additional costs.

In addition, these customers are responsible for a significant portion of our net trade accounts receivable balances.

In addition, these customers are responsible for a significant portion

of our net trade accounts receivable balances.

The loss of any large customer, a significant reduction in sales we make to them, any cancellation of orders they have made with us, or any failure to pay for the products we have shipped to them could adversely affect our results of operations.

If we are unable to establish commercial capabilities outside the United States for products we intend to commercialize or co-commercialize outside the United States, our business, prospects, operating results, and financial condition may be adversely affected.

If we are unable to establish commercial capabilities outside the United States for Libtayo, Dupixent, and any other products we intend to commercialize or co-commercialize outside the United States, our business, prospects, operating results, and financial condition may be adversely affected.

We have limited commercial capabilities outside the United States and do not currently have a fully established organization for the sales, marketing, and distribution of marketed products outside the United States.

We will need to establish some or all of these capabilities outside the United States for any product we decide to independently commercialize or co-commercialize outside the United States.

For example, following the exercise of our option under the Antibody Collaboration to co-commercialize Dupixent in certain jurisdictions outside the United States, we have begun establishing certain commercial capabilities for Dupixent in such jurisdictions.

In addition, we and Sanofi recently amended the IO Collaboration to transfer the rights to develop, commercialize, and manufacture Libtayo exclusively to our Company, on a worldwide basis, over the course of a defined transition period, and we will need to establish commercial, development, and manufacturing capabilities for Libtayo in many jurisdictions outside the United States.

See Part I, Item 2.

"Management's Discussion and Analysis of Financial Condition and Results of Operations - Collaboration, License, and Other Agreements - Sanofi." There may be other circumstances in which we need to establish commercial capabilities outside the United States, including because we decide to commercialize a particular product independently;

For example, in 2022, we and Sanofi amended the IO Collaboration to transfer all rights to develop, commercialize, and manufacture Libtayo exclusively to our Company, on a worldwide basis, over the course of a defined transition period, and we will need to establish certain sales, marketing, distribution, and manufacturing capabilities for Libtayo to support certain markets outside the United States.

We will also need to obtain and/or maintain regulatory approvals for Libtayo in many jurisdictions outside of the United States.

In addition, following the exercise of our option under the Antibody Collaboration to co-commercialize Dupixent in certain jurisdictions outside the United States, we have established certain commercial capabilities for Dupixent in some of these jurisdictions and are in the process of establishing these capabilities in others.

There may be other circumstances in which we need to establish commercial capabilities outside the United States, including because we decide to commercialize a particular product independently;

we are unable to find an appropriate collaborator;

or an existing collaborator decides to opt out or breaches its obligations to us with respect to a particular product.

In order to commercialize or co-commercialize any products outside the United States, we must build our sales, marketing, distribution, managerial, and other capabilities in the relevant markets or make arrangements with third parties to perform these services, any of which will likely be expensive and time consuming and could delay product launch or the co-commercialization of a product in one or more markets outside the United States.

We cannot be certain that we will be able to successfully develop commercial capabilities outside the United States (including as it relates to Dupixent and Libtayo) within an acceptable time frame, without incurring substantial expenses, or at all.

These and other difficulties relating to commercializing our products outside the United States may severely harm our business, prospects, operating results, and financial condition.

In order to commercialize or co-commercialize any products outside the United States, we must build our sales, marketing, distribution, regulatory, managerial, and other capabilities in the relevant markets or make arrangements with third parties to perform these services, any of which will likely be expensive and time consuming and could delay product launch or the co-commercialization of a product in one or more markets outside the United States.

We cannot be certain that we will be able to successfully develop commercial capabilities outside the United States (including as it relates to Libtayo and Dupixent) within an acceptable time frame, without incurring substantial expenses, or at all.

These and other difficulties relating to commercializing our products outside the United States may harm our business, prospects, operating results, and financial condition.

Risks Related to Maintaining Approval of Our Marketed Products and the Development and Obtaining Approval of Our Product Candidates and New Indications for Our Marketed Products

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A REMS may include various elements, ranging from a medication guide or patient package insert to limitations on who may prescribe or dispense the drug, depending on what the FDA considers necessary for the safe use of the drug.

The FDA has substantial discretion in the approval process (including with respect to setting specific conditions for submission) and may either refuse to accept an application for substantive review or may form the opinion after review of an application that the application is

insufficient to allow approval of a product candidate.

If the FDA does not accept our application for review or approve our application, it may require that we conduct additional clinical, preclinical, or manufacturing validation studies and submit the data before it will reconsider our application.

Depending on the extent of these or any other studies that might be required, approval of any applications that we submit may be delayed significantly, or we may be required to expend more resources.

It is also possible that any such additional studies, if performed and completed, may not be considered sufficient by the FDA to make our applications approvable.

also possible that any such additional studies, if performed and completed, may not be considered sufficient by the FDA to make our applications approvable.

If any of these outcomes occur, we may be forced to delay or abandon our applications for approval.

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The FDA may also require us to conduct additional clinical trials after granting approval of a product.

Its ability to do so has been enhanced by the Food and Drug Administration Amendments Act of 2007, pursuant to which the FDA has the explicit authority to require post-marketing studies (also referred to as post-approval or Phase 4 studies), labeling changes based on new safety information, and compliance with FDA-approved risk evaluation and mitigation strategies.

The FDA has the explicit authority to require post-marketing studies (also referred to as post-approval or Phase 4 studies), labeling changes based on new safety information, and compliance with FDA-approved risk evaluation and mitigation strategies.

Post-approval studies, whether conducted by us or by others and whether mandated by regulatory agencies or voluntary, and other data about our marketed products (or data about products similar to our marketed products that implicate an entire class of products or are perceived to do so) may result in changes in product labeling, restrictions on use, product withdrawal or recall, loss of approval, or lower sales of our products.

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However, the FDA's review goals are subject to change and the duration of the FDA's review depends on a number of factors, including the number and types of other applications that are submitted to the FDA around the same time period or are pending, and may be delayed for reasons beyond our control.

For example, an FDA travel complication related to scheduling a routine clinical trial site inspection in eastern Europe has delayed the FDA's decision on the sBLA for the combination treatment of Libtayo with chemotherapy in NSCLC until after the original target action date.

Even if any of our applications receives a priority review designation, we may not ultimately be able to obtain approval of our application within a time frame consistent with the FDA's stated review goals or at all, and such designation may not actually lead to a faster development or regulatory review or approval process.

Procedures that are equivalent in scope, but which can vary widely in application, apply in foreign countries.

For example, in 2022, an FDA travel complication related to scheduling a routine clinical trial site inspection in eastern Europe delayed by nearly two months the FDA's approval of our sBLA for the combination treatment of Libtayo with chemotherapy in NSCLC.

If we believe we meet eligibility requirements, we may apply for various regulatory incentives in the United States, such as breakthrough therapy designation, fast track designation, accelerated approval, or priority review, where available, that serve to expedite drug development and/or review, and we may also seek similar designations elsewhere in the world.

Often, regulatory agencies have broad discretion in determining whether or not product candidates qualify for such regulatory incentives and benefits, and we cannot guarantee we would be successful in obtaining beneficial regulatory designations by the FDA or other regulatory agencies.

Even if obtained, such designations may not result in faster development processes, reviews, or approvals compared to drugs considered for approval under conventional FDA procedures.

In addition, the FDA may later decide that any of our development programs no longer meets the conditions for a beneficial regulatory designation (including due to factors beyond our control, such as intervening competitive developments) or decide that the time period for FDA review or approval will not be shortened.

The FDA and comparable foreign regulatory authorities enforce Good Clinical Practice requirements ("GCPs") and other regulations and legal requirements through periodic inspections of trial sponsors, clinical research organizations ("CROs"), principal investigators, and trial sites.

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Before approving a new drug or biologic product, the FDA and such comparable foreign regulatory authorities require that the facilities at which the product will be manufactured or advanced through the supply chain be in compliance with current Good Manufacturing Practices, or cGMP, requirements and regulations governing the manufacture, shipment, and storage of the product.

Additionally, manufacturers of biological products and their facilities are subject to payment of substantial user fees and continual review and periodic inspections by the FDA and other regulatory authorities for compliance with cGMP regulations and adherence to any commitments made in the applicable BLA.

These cGMP requirements and regulations are not prescriptive instructions on how to manufacture products, but rather a series of principles that must be observed during

manufacturing;

Additionally, manufacturers of biological products and their facilities are subject to payment of substantial user fees

and continual review and periodic inspections by the FDA and other regulatory authorities for compliance with cGMP regulations and adherence to any commitments made in the applicable BLA.

These cGMP requirements and regulations are not prescriptive instructions on how to manufacture products, but rather a series of principles that must be observed during manufacturing;

as a result, their implementation may not be clearly delineated and may present a challenging task.

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grant similar powers to the competent authorities and impose similar obligations on companies.

In addition to the standard drug approval process, the Secretary of HHS may authorize the issuance of, and the FDA Commissioner may issue, an EUA to allow an unapproved medical product to be used in an emergency based on criteria established by the Food, Drug, and Cosmetic Act, including that the product at issue may be effective in diagnosing, treating, or preventing serious or life-threatening diseases when there are no adequate, approved, and available alternatives.

In addition to the standard drug approval process, the Secretary of the U.S.

Department of Health and Human Services ("HHS") may authorize the issuance of, and the FDA Commissioner may issue, an EUA to allow an unapproved medical product to be used in an emergency based on criteria established by the Food, Drug, and Cosmetic Act, including that the product at issue may be effective in diagnosing, treating, or preventing serious or life-threatening diseases when there are no adequate, approved, and available alternatives.

An EUA terminates when the emergency determination underlying the EUA terminates.

The FDA may also revoke, revise, or restrict an EUA for a variety of reasons, including where it is determined that the underlying health emergency no longer exists or warrants such authorization or the medical product is no longer effective in diagnosing, treating, or preventing the underlying health emergency.

For example, in January 2022, the FDA revised the EUA previously granted for REGEN-COV to exclude its use in geographic regions where, based on available information including variant susceptibility and regional variant frequency, infection or exposure is likely due to a variant such as an Omicron-lineage variant that is not susceptible to the treatment.

With this EUA revision, REGEN-COV is not currently authorized for use in any U.S.

states, territories, or jurisdictions, since Omicron-lineage variants are currently dominant across the United States.

For example, in January 2022, the FDA revised the EUA previously granted for REGEN-COV to exclude its use in geographic regions (currently including all U.S.

states, territories, and jurisdictions) where, based on available information including variant susceptibility and regional variant frequency, infection or exposure is likely due to a variant such as an Omicron-lineage variant that is not susceptible to the treatment.

Any such termination, revocation, or revision of an EUA could adversely impact our business in a variety of ways, including by having to absorb related manufacturing and overhead costs as well as potential inventory write-offs if regulatory approval is not obtained timely or at all.

For example, during the fourth quarter of 2021, we recorded a charge of $231.7 million to write down REGEN-COV inventory.

For example, during each of the years ended December 31, 2022 and 2021, we recorded a charge to write down inventory related to REGEN-COV.

In addition to the FDA and other regulatory agency regulations in the United States, we are subject to a variety of foreign regulatory requirements governing human clinical trials, manufacturing, marketing and approval of drugs, and commercial sale and distribution of drugs in foreign countries.

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In addition, actions by a regulatory agency in a country or region with respect to a product candidate may have an impact on the approval process for that product candidate in another country or region.

Foreign regulatory authorities may ask for additional data in order to begin a clinical study, including phase 3 clinical trials required to submit a Marketing Authorization Application ("MAA") in the EU.

Foreign regulatory authorities may ask for additional data in order to begin a clinical study, including Phase 3 clinical trials required to submit a MAA in the EU.

In addition, such authorities often have the authority to require post-approval studies, such as a post-authorization safety study ("PASS") and/or post-authorization efficacy study ("PAES"), which involve various risks similar to those described above.

Whether or not we obtain FDA approval for a product in the United States, we must obtain approval of the product by the comparable regulatory authorities in foreign countries before we can market that product or any other product in those countries.

Furthermore, in the European Economic Area ("EEA"), if we do not manage to retain a Qualified Person Responsible for Pharmacovigilance ("QPPV"), to maintain a Pharmacovigilance System Master File ("PSMF"), or to comply with other pharmacovigilance obligations, we may be at risk of our clinical trials being closed prematurely, our marketing authorization being suspended, and we may be subject to other enforcement actions by the national competent authorities of the EEA or the EC.

The exact requirements concerning pharmacovigilance reporting may differ in the numerous countries in which we conduct clinical trials.

Failure to comply with the related pharmacovigilance requirements may result in the premature closure of the clinical trials and other enforcement actions by the relevant regulatory authorities.

Furthermore, we are subject to pharmacovigilance reporting and other pharmacovigilance requirements, which may differ in the numerous countries in which we conduct clinical trials or commercialize a product.

Failure to comply with any such requirements may result in the premature closure of the clinical trials and other enforcement actions by the relevant regulatory authorities.

For example, if we do not manage to retain a Qualified Person Responsible for Pharmacovigilance ("QPPV"), to maintain a Pharmacovigilance System Master File ("PSMF"), or to comply with other pharmacovigilance obligations in the European Economic Area ("EEA"), we may be at risk of our clinical trials being closed prematurely, our marketing authorization being suspended, and we may be subject to other enforcement actions by the national competent authorities of the EEA or the EC.

Preclinical and clinical studies required for our product candidates and new indications of our marketed products are expensive and time-consuming, and their outcome is highly uncertain.

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For example, we and our collaborators are currently conducting and may in the future conduct or initiate clinical trials with sites in Russia and/or Ukraine.

While we currently do not expect the conflict between Russia and Ukraine and related developments to have a significant impact on our ability to obtain results from clinical trials conducted by us or our collaborators, actions taken by Russia or potentially other countries in Ukraine and surrounding areas may adversely affect our ability to adequately conduct certain clinical trials and maintain compliance with relevant protocols due to, among other reasons, the prioritization of hospital resources away from clinical trials, reallocation or evacuation of site staff and subjects, or as a result of government-imposed curfews, warfare, violence, or other governmental action or events that restrict movement.

These developments may also result in our inability to access sites for monitoring or to obtain data from affected sites or patients going forward.

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Moreover, even if we obtain positive results from preclinical testing or clinical trials, we may not achieve the same success in future trials, or the FDA and analogous foreign regulatory authorities may deem the results insufficient for an approval.

If concerns arise about the safety of a product candidate or non-compliance with the protocol or applicable regulatory requirements, the FDA or other regulatory authorities can delay or suspend a clinical trial by placing it on a full or partial "clinical hold" pending receipt of additional data or the satisfaction of other conditions.

A clinical hold may require us to spend significant resources to address the underlying causes of the clinical hold and may result in a delay in the clinical program, which may be significant.

In addition, if we are not able to successfully address such underlying causes or our response is not deemed adequate to lift the clinical hold, the clinical program may have to be terminated.

Any such clinical program delays or terminations may adversely affect our business.

Many of our clinical trials are conducted under the oversight of Independent Data Monitoring Committees ("IDMCs").

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Any of our ongoing clinical trials may be discontinued or amended in response to recommendations made by responsible IDMCs based on their review of such interim trial results.

For example, we previously discontinued actively treating patients with fasinumab (which at such time only involved dosing in an optional second-year extension phase of one trial) following a recommendation from the responsible IDMC that the program be terminated based on available evidence to date;

For example, we previously discontinued actively treating patients with fasinumab following a recommendation from the responsible IDMC that the program be terminated based on available evidence at that time;

and we later discontinued further clinical development of fasinumab.

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If additional clinical experience indicates that any of our product candidates or new indications for our marketed products has many side effects or causes serious or life-threatening side effects, the development of the product candidate may be delayed or fail, or, if the product candidate has received regulatory approval, such approval may be revoked, which would severely harm our business, prospects, operating results, and financial condition.

With respect to EYLEA and aflibercept 8 mg, there are many potential safety concerns associated with significant blockade of VEGF that may limit our ability to further successfully commercialize EYLEA and to obtain regulatory approval for aflibercept 8 mg.

These serious and potentially life-threatening risks, based on clinical and preclinical experience of VEGF inhibitors, include bleeding, intestinal perforation, hypertension, proteinuria, congestive heart failure, heart attack, and stroke.

Other VEGF blockers have reported side effects that became evident only after large-scale trials or after marketing approval when large numbers of patients were treated.

There are risks inherent in the intravitreal administration of drugs like aflibercept (such as intraocular inflammation ("IOI"), sterile and culture positive endophthalmitis, corneal decomposition, retinal detachment, and

retinal tear), which can cause injury to the eye and other complications.

The side effects previously reported for aflibercept include conjunctival hemorrhage, macular degeneration, eye pain, retinal hemorrhage, and vitreous floaters.

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For example, in the United States and the EU, EYLEA is approved in the 2mg pre-filled syringe.

The success of our products and product candidates may depend to a significant extent on the performance of such devices, some of which may be novel or comprised of complex components.

The success of our products and product candidates may depend to a significant extent on the performance of such devices, some of which may be novel or comprised of

complex components.

Given the increased complexity of the review process when approval of the product and device is sought under a single marketing application and the additional risks resulting from a product candidate's designation as a combination product discussed below, our product candidates used with such drug-delivery devices may be substantially delayed in receiving regulatory approval or may not be approved at all.

The FDA review process and criteria for such applications are not well established, which could also lead to delays in the approval process.

In addition, some of these drug-delivery devices may

be provided by single-source, third-party providers or our collaborators.

In addition, some of these drug-delivery devices may be provided by single-source, third-party providers or our collaborators.

In any such case, we may be dependent on the sustained cooperation of those third-party providers or collaborators to supply and manufacture the devices;

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Such opposition proceedings are increasingly common in Europe and are costly to defend.

For example, our European Patent No.

2,264,163 (which concerns genetically engineered mice capable of producing chimeric antibodies that are part human and part mouse) is the subject of opposition proceedings in the European Patent Office (the "EPO") (currently pending before its Boards of Appeal).

In addition, on October 26 and October 27, 2021, anonymous parties initiated opposition proceedings in the EPO against our European Patent No.

For example, in 2021, anonymous parties initiated opposition proceedings in the European Patent Office ("EPO") against our European Patent No.

2,944,306 (which concerns pre-filled syringes comprising ophthalmic formulations containing VEGF antagonists such as aflibercept for intravitreal administration), as described in Note 11 to our Condensed Consolidated Financial Statements included in this report.

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Changes in either the patent laws or their interpretation in the United States and other countries may diminish our ability to protect our inventions or our ability to obtain, maintain, and enforce our intellectual property rights.

Any such changes could also affect the value of our intellectual property or narrow the scope of our patents.

For example, the World Trade Organization ("WTO") is currently considering an extension of a recently adopted waiver of certain intellectual property rights under the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights for COVID-19 vaccines to include therapeutics.

timing of a decision on whether or not to extend the waiver is unknown.

We cannot be certain that our intellectual property rights related to our COVID-19 monoclonal antibodies or any other current or future product or product candidate or technology would not be eliminated, narrowed, or weakened by any such extension or other rulemaking.

Any such changes could

also affect the value of our intellectual property or narrow the scope of our patents.

We cannot be certain that our intellectual property rights related to any current or future product or product candidate or technology would not be eliminated, narrowed, or weakened by any such change or other rulemaking.

Additionally, the United States and other government actions related to Russia's invasion of Ukraine may limit or prevent filing, prosecution, and maintenance of patent applications in Russia.

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We are aware of several companies developing biosimilar versions of EYLEA, as discussed further under "Risks Related to Commercialization of Our Marketed Products, Product Candidates, and New Indications for Our Marketed Products - The commercial success of our products and product candidates is subject to significant competition - Marketed Products" above.

In the United States, the regulatory exclusivity period for EYLEA (i.e., the period during which no biosimilar product can be approved by the FDA) extends through May 17, 2024 following the recently announced pediatric exclusivity granted by the FDA.

See Part I, Item 2.

"Management's Discussion and Analysis of Financial Condition and Results of Operations - Overview - Programs in Clinical Development." The loss of market exclusivity for a product (such as EYLEA) would likely materially and negatively affect revenues from product sales of that product and thus our financial results and condition.

The loss of market exclusivity for a product (such as EYLEA) would likely materially and negatively affect revenues from product sales of that product and thus our financial results and condition.

Risks Related to Manufacturing and Supply

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We have large-scale manufacturing operations in Rensselaer, New York and Limerick, Ireland.

clinical pipeline advances as planned.

In addition to expanding our internal capacity, we intend to continue to rely on our collaborators, and may also rely on contract manufacturers, to produce commercial quantities of drug material needed for commercialization of our products.

Manufacturing facilities operated by us and by third-party contract manufacturers engaged by us would be inadequate to produce the active pharmaceutical ingredients of our current marketed products and our product candidates in sufficient clinical quantities if our clinical pipeline advances as planned or if there is greater demand than currently expected for our marketed products.

In addition to expanding our internal capacity, we intend to continue to rely on our collaborators, and may also rely on contract

manufacturers, to produce commercial quantities of drug material needed for commercialization of our products.

As we increase our production in anticipation of potential regulatory approval for our product candidates, our current manufacturing capacity will likely not be sufficient, and our dependence on our collaborators and/or contract manufacturers may increase, to produce adequate quantities of drug material for both commercial and clinical purposes.

The COVID-19 pandemic has exacerbated and may in the future further exacerbate certain of these risks.

For example, the impact of prioritizing certain manufacturing-related resources for our COVID-19 monoclonal antibodies has included and may in the future include, among other things, drawing down inventory safety stock levels for certain of our other products (including Dupixent and EYLEA).

Depending on the demand for our products, our ability to re-establish successfully our customary manufacturing cadence, and other relevant factors, we may not be able to replenish our inventory safety stock to the levels we deem prudent or supply our products and product candidates in sufficient quantities to satisfy our commercial and development needs.

We also rely entirely on other parties and our collaborators for filling and finishing services.

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"Management's Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources" for information about expected capital expenditures relating to this and other projects).

In addition, we may need to develop or acquire additional manufacturing capabilities to the extent we or our collaborators pursue the development of drugs generated by means other than our existing "Trap" or VelociSuite ® technologies, such as siRNA gene silencing, genome editing, and targeted viral-based gene delivery and expression.

Further, we will need to hire and train significant numbers of employees and managerial personnel to staff our expanding manufacturing and supply chain operations, as well as any future fill/finish activities.

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In addition, if we or our collaborators experience excess inventory, it may be necessary to write down or write off such excess inventory or incur an impairment charge with respect to the facility where such product is manufactured, which could adversely affect our operating results.

For example, during the fourth quarter of 2021, we recorded a charge of $231.7 million to write down REGEN-COV inventory.

For example, during each of the years ended December 31, 2022 and 2021, we recorded a charge to write down inventory related to REGEN-COV.

Third-party service or supply failures, or other failures, business interruptions, or other disasters affecting our manufacturing facilities in Rensselaer, New York and Limerick, Ireland, the manufacturing facilities of our collaborators, or the facilities of any other party participating in the supply chain, would adversely affect our ability to supply our products.

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Also, the complexity of our manufacturing process may make it difficult, time-consuming, and expensive to transfer our technology to our collaborators or contract manufacturers.

Also, certain raw materials or other products necessary for the manufacture and formulation of our marketed products and product candidates, some of which are difficult to source, are provided by single-source unaffiliated third-party suppliers.

Certain raw materials or other products necessary for the manufacture and formulation of our marketed products and product candidates, some of which are difficult to source, are provided by single-source unaffiliated third-party suppliers.

In addition, we rely on certain third parties or our collaborators to perform filling, finishing, distribution, laboratory testing, and other services related to the manufacture of our marketed products and product candidates, and to supply various raw materials and other products.

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Because of the breadth of these laws and the narrowness of the safe harbors, it is possible that some of our business activities could be challenged under one or more of such laws.

As described further in Note 14 to our Condensed Consolidated Financial Statements included in this report, we are party to civil litigation initiated in June 2020 by the U.S.

As described further in Note 11 to our Condensed Consolidated Financial Statements included in this report, we are party to civil litigation initiated in 2020 by the U.S.

Attorney's Office for the District of Massachusetts concerning our support of a 501(c)(3) organization that provides financial assistance to patients;

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Information provided by companies is aggregated and posted annually on an "Open Payments" website, which is managed by CMS, the agency responsible for implementing these disclosure requirements.

Beginning in 2022, applicable manufacturers also are required to report information regarding payments and transfers of value provided to physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists, anesthesiologist assistants, and certified nurse-midwives.

Applicable manufacturers also are required to report information regarding payments and transfers of value provided to physician assistants, nurse practitioners, clinical nurse specialists, certified nurse anesthetists, anesthesiologist assistants, and certified nurse-midwives.

We also have similar reporting obligations in other countries based on laws, regulations, and/or industry trade association requirements.

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An ADR proceeding could subject us to onerous procedural requirements and could result in additional liability.

On November 30, 2022, HRSA issued a notice of proposed rulemaking that proposes several changes to the ADR process.

Further, any additional future changes to the definition of average manufacturer price and the Medicaid rebate amount under the PPACA or otherwise could affect our 340B ceiling price calculations and negatively impact our results of operations.

We have obligations to report the average sales price for certain of our drugs to the Medicare program as a part of our agreement to participate in the Medicaid Drug Rebate program.

For calendar quarters beginning January 1, 2022, we need to report the average sales price for certain drugs under the Medicare program regardless of whether we participate in the Medicaid Drug Rebate program.

We have obligations to report the average sales price for certain of our drugs to the Medicare program.

Statutory or regulatory changes or CMS guidance could affect the average sales price calculations for our products and the resulting Medicare payment rate, and could negatively impact our results of operations.

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If we overcharge the government in connection with our arrangements with FSS or Tricare, we are required to refund the difference to the government.

Failure to make necessary disclosures or to identify contract overcharges can result in allegations against us under

the False Claims Act and other laws and regulations.

Unexpected refunds to the government, and/or response to a government investigation or enforcement action, would be expensive and time-consuming, and could have a material adverse effect on our business, financial condition, results of operations, and future prospects.

Failure to make necessary disclosures or to identify contract overcharges can result in allegations against us under the False Claims Act and other laws and regulations.

Unexpected refunds to the government, and/or response to a government

investigation or enforcement action, would be expensive and time-consuming, and could have a material adverse effect on our business, financial condition, results of operations, and future prospects.

Risks from the improper conduct of employees, agents, contractors, or collaborators could adversely affect our reputation and our business, prospects, operating results, and financial condition.

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These entities, including the SEC and The NASDAQ Stock Market LLC, have issued a significant number of new and increasingly complex requirements and regulations over the course of the last several years and continue to develop additional requirements and regulations.

For example, in March 2022, the SEC proposed new rules for extensive and prescriptive climate-related disclosure in annual reports and registration statements, which would also require inclusion of certain climate-related financial metrics in a note to companies’ audited financial statements.

Also in March 2022, the SEC proposed rules that are intended to enhance and standardize disclosures regarding cybersecurity risk management, strategy, and governance, as well as cybersecurity incident reporting, by public companies.

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• changes in the FDA and foreign regulatory processes for new therapeutics that may delay or prevent the approval of any of our current or future product candidates;

• new laws, regulations, or judicial decisions related to healthcare availability or the payment for healthcare products and services, including prescription drugs, that would make it more difficult for us to market and sell products once they are approved by the FDA or foreign regulatory agencies;

• new laws, regulations, or judicial decisions related to prescription drugs or other healthcare products, healthcare availability, or the payment for healthcare products and services, including prescription drugs, that would make it more difficult for us to market and sell products once they are approved by the FDA or foreign regulatory agencies;

• changes in FDA and foreign regulations that may require additional safety monitoring prior to or after the introduction of new products to market, which could materially increase our costs of doing business;

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As described above, the PPACA and potential regulations thereunder easing the entry of competing follow-on biologics into the marketplace, other new legislation or implementation of existing statutory provisions on importation of lower-cost competing drugs from other jurisdictions, and legislation on comparative effectiveness research are examples of previously enacted and possible future changes in laws that could adversely affect our business.

government could carry out other significant changes in legislation, regulation, and government policy, including with respect to government reimbursement changes and drug price control measures (such as those discussed above under "Risks Related to Commercialization of Our Marketed Products, Product Candidates, and New Indications for Our Marketed Products - Sales of our marketed products are dependent on the availability and extent of reimbursement from third-party payors, and changes to such reimbursement may materially harm our business, prospects, operating results, and financial condition ").

federal or state governments could carry out other significant changes in legislation, regulation, or government policy, including with respect to government reimbursement changes or drug price control measures (such as those discussed above under "Risks Related to Commercialization of Our Marketed Products, Product Candidates, and New Indications for Our Marketed Products - Sales of our marketed products are dependent on the availability and extent of reimbursement from third-party payors, and changes to such reimbursement may materially harm our business, prospects, operating results, and financial condition ") or the PPACA or other healthcare reform laws.

While it is not possible to predict whether and when any such changes will occur, changes in the laws, regulations, and policies governing the development and approval of our product candidates and the commercialization, importation, and reimbursement of our products could adversely affect our business.

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Risks associated with our operations outside the United States could adversely affect our business.

We have operations and conduct business in several countries outside the United States and we plan to expand these activities.

For example, as discussed above, we recently commenced co-commercialization activities under the Antibody Collaboration related to Dupixent in certain jurisdictions outside the United States and we will need to establish commercial capabilities related to Libtayo outside the United States following the amendment to the IO Collaboration.

Consequently, we are, and will continue to be, subject to risks related to operating in foreign countries, and many of these risks will increase as we expand our activities in such jurisdictions.

We have operations and conduct business in several countries outside the United States and we plan to significantly expand the scope of these activities in existing and/or additional countries.

For example, as discussed above, we will need to establish commercial capabilities related to Libtayo in certain markets outside the United States following the amendment to the IO Collaboration;

and we perform co-commercialization activities under the Antibody Collaboration related to Dupixent in certain jurisdictions outside the United States.

Consequently, we are, and will continue to be, subject to risks related to operating in foreign countries, particularly those in which we have not previously established operations, and many of these risks will increase as we expand our activities in such jurisdictions.

These risks include:

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• cultural differences in the conduct of business.

For example, effective January 31, 2020, the United Kingdom commenced an exit from the EU, commonly referred to as "Brexit." The transition period for Brexit expired on December 31, 2020 following the entry into a trade agreement that now

governs the United Kingdom's relationship with the EU.

We do not know to what extent Brexit will ultimately impact the business and regulatory environment in the United Kingdom, the rest of the EU, or other countries.

For example, the impact of Brexit on the ongoing validity in the United Kingdom of current EU authorizations for medicinal products and on the future process for obtaining and maintaining marketing authorization for pharmaceutical products manufactured or sold in the United Kingdom remains uncertain.

We have large-scale manufacturing operations in Limerick, Ireland and have also established an office in the vicinity of London.

Changes impacting our ability to conduct business in the United Kingdom or other EU countries, or changes to the regulatory regime applicable to our operations in those countries (such as with respect to the approval of our product candidates), may materially and adversely impact our business, prospects, operating results, and financial condition.

We have large-scale manufacturing operations in Limerick, Ireland and have also established offices in the United Kingdom, Germany, and other countries outside the United States.

Changes impacting our ability to conduct business in the those countries, or changes to the regulatory regime applicable to our operations in those countries (such as with respect to the approval of our product candidates), may materially and adversely impact our business, prospects, operating results, and financial condition.

We may incur additional tax liabilities related to our operations.

We are subject to income tax in the United States and various foreign jurisdictions.

Significant judgment is required in determining our worldwide tax liabilities, and our effective tax rate is derived from a combination of the applicable statutory rates in the various jurisdictions in which we operate.

We are subject to income tax in the United States and foreign jurisdictions in which we operate.

Significant judgment is required in determining our worldwide tax liabilities, and our effective tax rate is derived from the applicable statutory tax rates and relative earnings in each taxing jurisdiction.

We record liabilities for uncertain tax positions that involve significant management judgment as to the application of law.

The Internal Revenue Service or other domestic or foreign taxing authorities have previously disagreed, and may in the future disagree, with our interpretation of tax law as applied to the operations of Regeneron and its subsidiaries or with the positions we may take with respect to particular tax issues on our tax returns (see also Note 14 of the Company's Consolidated Financial Statements included in the Company's Annual Report on Form 10-K for the year ended December 31, 2021).

Consequently, our reported effective tax rate and our after-tax cash flows may be materially and adversely affected by tax assessments or judgments in excess of accrued amounts we have estimated in preparing our financial statements.

Further, our effective tax rate may also be adversely affected by numerous other factors, including changes in the mix of our profitability from country to country, changes in tax laws and regulations, and tax effects of the accounting for stock-based compensation (which depend in part on the price of our stock and, therefore, are beyond our control).

For example, the IRA has created a new corporate alternative minimum tax of 15% on adjusted financial statement income that applies to certain corporations for tax years beginning after December 31, 2022.

Further specifics of this legislation will be outlined in Treasury regulations and any impact to the Company will depend on a number of factors, including any offsets for foreign tax credits or general business credits.

The IRA also created an excise tax of 1% of the value of certain stock repurchases after December 31, 2022 that generally applies to publicly traded domestic corporations.

We are in the process of evaluating the potential impact of these alternative minimum and excise tax provisions of the IRA.

Other changes to U.S.

tax laws and/or recommendations from the Organization for Economic Co-operation and Development (the "OECD") regarding a global minimum tax and other changes being considered and/or implemented in countries where we operate could materially impact our tax provision, cash tax liability, and effective tax rate.

In addition, recommendations by the OECD and the EU could require companies to disclose more information to tax authorities on operations around the world, which may lead to greater audit scrutiny.

Even though we regularly assess the information provided to tax authorities in determining the appropriateness of our tax reserves, such tax authorities could take a position that is contrary to our expectations, and the result could adversely affect our provision for income tax and our current rate.

Domestic or foreign taxing authorities have previously disagreed, and may in the future disagree, with our interpretation of tax law as applied to the operations of Regeneron and its subsidiaries or with the positions we may take with respect to particular tax issues on our tax returns.

Consequently, tax assessments or judgments in excess of accrued amounts that we have estimated in preparing our financial statements may materially and adversely affect our reported effective tax rate or our cash flows.

Further, other factors may adversely affect our effective tax rate, including changes in the mix of our profitability from country to country, changes in tax laws and regulations, and tax effects of the accounting for stock-based compensation (which depend in part on the price of our stock and, therefore, are beyond our control).

For example, the IRA has created a corporate alternative minimum tax of 15% on adjusted financial statement income and an excise tax of 1% of the value of certain stock repurchases that apply to certain corporations for tax years beginning after December 31, 2022.

Further, actions taken by the Organization for Economic Co-operation and Development and the EC could also influence tax laws in countries in which we operate, including the implementation of a global minimum tax.

Changes to these or other laws and regulations or their interpretations could materially adversely impact our effective tax rate or cash flows.

We face risks related to the personal data we collect, process, and share.

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In addition to the GDPR, certain EU Member States have issued or will be issuing their own implementation legislation.

In June 2021, the European Commission introduced new standard contractual clauses required to be incorporated into certain new and existing agreements within prescribed timeframes in order to continue to lawfully transfer personal data outside the EU.

In June 2021, the EC introduced new standard contractual clauses required to be incorporated into certain new and existing agreements within prescribed timeframes in order to continue to lawfully transfer personal data outside the EU.

Compliance with these requirements has been and is expected to continue to be costly and time consuming.

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health care providers, including research institutions from which we or our collaborators obtain clinical trial data, are subject to privacy and security regulations promulgated under HIPAA.

For example, as part of our human genetics initiative, our wholly-owned subsidiary, Regeneron Genetics Center LLC, has entered into collaborations with research institutions, including the Geisinger Health System, which are subject to HIPAA.

For example, as part of our human genetics initiative, our wholly-owned subsidiary, Regeneron Genetics Center LLC, has entered into collaborations with many research institutions, which are subject to HIPAA.

Regeneron is not a covered entity or business associate under HIPAA and thus is not subject to its requirements.

However, we could be subject to criminal penalties if we, our affiliates, or our agents knowingly receive, use, or disclose protected health information ("PHI") in a manner that is not permitted under HIPAA.

However, we could be subject to criminal penalties if we, our affiliates, or our agents knowingly receive PHI in a manner that is not permitted under HIPAA.

Consequently, depending on the facts and circumstances, we could face substantial criminal penalties if we knowingly receive PHI from a health care provider or research institution that has not satisfied HIPAA's requirements for its disclosure.

There are instances where we collect and maintain personal data, which may include health information that is outside the scope of HIPAA but within the scope of state health privacy laws or similar state level privacy legislation.

There are instances where we collect and maintain personal data, which may include

health information that is outside the scope of HIPAA but within the scope of state health privacy laws or similar state level privacy legislation.

This information may be received throughout the clinical trial process, in the course of our research collaborations, directly from individuals who enroll in our patient assistance programs, and from our own employees in a pandemic response process (such as in connection with the COVID-19 pandemic).

Consumer protection laws impact the manner in which we develop and maintain processes to support our patient assistance programs, product marketing activities, and the sharing of employee and clinical data for internal and third-party commercial activities.

states have proposed and passed consumer privacy laws, which were modeled after the California Consumer Privacy Act of 2018 (the "CCPA").

The CCPA, which became effective on January 1, 2020, is a consumer protection law that establishes requirements for data use and sharing transparency and provides California residents with personal data privacy rights regarding the use, disclosure, and retention of their personal data.

states have proposed and passed consumer privacy laws, which were modeled after the California Consumer Privacy Act of 2018 ("CCPA") and influenced by the GDPR.

The CCPA is a consumer protection law that establishes requirements for data use and sharing transparency and provides California residents with personal data privacy rights regarding the use, disclosure, and retention of their personal data.

Amendments to the CCPA have, among other things, imposed new obligations to provide notice where personal data will be de-identified.

Failure to comply with the CCPA may result in, among other things, significant civil penalties and injunctive relief, or statutory or actual damages.

In addition, California residents have the right to bring a private right of action in connection with data privacy incidents involving certain elements of personal data.

These claims may result in significant liability and damages.

These laws and regulations are constantly evolving and may impose limitations on our business activities.

Several other U.S.

states have introduced similar consumer protection laws that may go into effect in the near future.

At the federal level, Section 5 of the Federal Trade Commission Act is a consumer protection law that bars unfair and deceptive acts and practices and requires, among other things, companies to notify individuals that they will safeguard their personal data and that they will fulfil the commitments made in their privacy notices.

The Federal Trade Commission has brought legal actions against organizations that have violated consumers' privacy rights or have misled them by failing to maintain appropriate security.

states have introduced similar consumer protection laws, some of which are set to go into effect in the near future.

At the federal level, Section 5 of the FTC Act is a consumer protection law that bars unfair and deceptive acts and practices and requires, among other things, companies to notify individuals that they will safeguard their personal data and that they will fulfil the commitments made in their privacy notices.

The FTC has brought legal actions against organizations that have violated consumers' privacy rights or have misled them by failing to maintain appropriate security.

Furthermore, health privacy laws, data breach notification laws, consumer protection laws, data localization laws, and genetic privacy laws may apply directly to our operations and/or those of our collaborators and may impose restrictions on our collection, use, and dissemination of individuals' health and other personal data.

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If Sanofi does not perform its obligations with respect to the product candidates it is co-developing with us, our ability to develop, manufacture, and commercialize these product candidates will be significantly adversely affected.

We have limited commercial capabilities outside the United States and would have to develop or outsource these capabilities for products commercialized under our Antibody Collaboration (see also "Risks Related to Commercialization of Our Marketed Products, Product Candidates, and New Indications for Our Marketed Products - If we are unable to establish commercial capabilities outside the United States for products we intend to commercialize or co-commercialize outside the United States, our business, prospects, operating results, and financial condition may be adversely affected " above).

We have limited commercial capabilities outside the United States and would have to develop or outsource these capabilities for products commercialized under our Antibody Collaboration (see also "Risks Related to Commercialization of Our Marketed Products, Product Candidates, and New Indications for Our Marketed Products - If we are unable to establish commercial capabilities outside the United States for Libtayo, Dupixent, or any other products we intend to commercialize or co-commercialize outside the United States, our business, prospects, operating results, and financial condition may be adversely affected " above).

Termination of the Antibody Collaboration would create substantial new and additional risks to the successful development and commercialization of the products subject to such collaborations, particularly outside the United States.

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If Bayer were to terminate its collaboration agreement with us, we may not have the resources or skills to replace those of our collaborator, which could require us to seek another collaboration that might not be available on favorable terms or at all, and could cause significant issues for the commercialization of EYLEA outside the United States and result in substantial additional costs and/or lower revenues to us.

We have limited commercial capabilities outside the United States and would have to develop or outsource these capabilities (see also "Risks Related to Commercialization of Our Marketed Products, Product Candidates, and New Indications for Our Marketed Products - If we are unable to establish commercial capabilities outside the United States for products we intend to commercialize or co-commercialize outside the United States, our business, prospects, operating results,

and financial condition may be adversely affected " above).

We have limited commercial capabilities outside the United States and would have to develop or outsource these capabilities (see also "Risks Related to Commercialization of Our Marketed Products, Product Candidates, and New Indications for Our Marketed Products - If we are unable to establish commercial capabilities outside the United States for Libtayo, Dupixent, or any other products we intend to commercialize or co-commercialize outside the United States, our business, prospects, operating results, and financial condition may be adversely affected " above).

Termination of the Bayer collaboration agreement would create substantial new and additional risks to the successful commercialization of EYLEA and, if approved, any potential future commercialization of aflibercept 8 mg outside the United States.

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We also depend, or will depend, on some of these or other third parties in connection with the commercialization of our marketed products and our product candidates and new indications for our marketed products if they are approved for marketing.

If any of our existing collaborators or service providers breaches or terminates its agreement with us or does not perform its development or manufacturing services under an agreement in a timely manner (including as a result of its inability to perform due to financial or other relevant constraints, such as due to Russia's invasion of Ukraine) or in compliance with applicable GMPs, GLPs, or GCP standards, we could experience additional costs, delays, and difficulties in the manufacture or development of, or in obtaining approval by regulatory authorities for, or successfully commercializing our product candidates.

or other relevant constraints, such as due to Russia's invasion of Ukraine) or in compliance with applicable GMPs, GLPs, or GCP standards, we could experience additional costs, delays, and difficulties in the manufacture or development of, or in obtaining approval by regulatory authorities for, or successfully commercializing our product candidates.

We and our collaborators rely on third-party service providers to support the distribution of our marketed products and for many other related activities in connection with the commercialization of these marketed products.

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In either case, the incurrence of these charges could adversely affect our operating results for particular periods.

Risks Related to Employees

Other Risks Related to Our Business

We are dependent on our key personnel and if we cannot recruit and retain leaders in our research, development, manufacturing, and commercial organizations, our business will be harmed.

We are highly dependent on certain of our executive officers, other key members of our senior management team, and the Chair of our board of directors.

We are highly dependent on certain of our executive officers and other key members of our senior management team.

If we are not able to retain (or for any other reason lose the services of) any of these persons, our business may suffer.

In particular, we depend on the services of P.

Roy Vagelos, M.D., the Chair of our board of directors;

Schleifer, M.D., Ph.D., our President and Chief Executive Officer;

and George D.

In particular, we depend on the services of Leonard S.

Schleifer, M.D., Ph.D., our President and Chief Executive Officer, and George D.

Yancopoulos, M.D., Ph.D., our President and Chief Scientific Officer.

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We may not be able to continue to attract and retain the qualified personnel necessary to continue to advance our business and achieve our strategic objectives.

Information Technology Risks

Significant disruptions of information technology systems or breaches of data security could adversely affect our business.

Our business is increasingly dependent on critical, complex, and interdependent information technology systems, including Internet-based systems, to support business processes as well as internal and external communications.

These systems are also critical to enable remote working arrangements, which have been growing in importance due in part to the COVID-19 pandemic and related developments.

These systems are also critical to enable remote working arrangements, which have been growing in importance.

The size and complexity of our computer systems make us potentially vulnerable to IT system breakdowns, internal and external malicious intrusion, and computer viruses and ransomware, which may impact product production and key business processes.

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or globally), which could have a material adverse effect on our business, prospects, operating results, and financial condition.

Risks Related to Our Financial Results, Liquidity, and Need for Additional Financing

Public health outbreaks, epidemics, or pandemics (such as the COVID-19 pandemic) have adversely affected and may in the future adversely affect our business.

The COVID-19 pandemic previously adversely affected, and the COVID-19 pandemic or other actual or threatened public health outbreaks, epidemics, or pandemics may in the future adversely affect, among other things, the economic and financial markets and labor resources of the countries in which we operate;

and the demand for our marketed products.

These and other adverse effects may result from various developments including the following :

• The imposition of various restrictions and mandates to reduce the spread of outbreaks, epidemics, or pandemics, including governmental orders that direct individuals to shelter at their places of residence, direct businesses and governmental agencies to cease non-essential operations at physical locations, prohibit certain non-essential gatherings, maintain social distancing, order cessation of non-essential travel, and require proof of vaccination and/or negative test results.

• Negative impacts on productivity, disruptions to our business, and delays to our clinical programs and development timelines caused by the imposition of various government-imposed or private-sector measures relating to outbreaks, epidemics, or pandemics.

Such restrictions and limitations could also negatively impact our access to regulatory authorities (which may be affected, among other things, by travel restrictions and may be delayed in responding to inquiries, reviewing filings, and conducting inspections);

our ability to perform regularly scheduled quality checks and maintenance;

and our ability to obtain services from third-party specialty vendors and other providers or to access their expertise as fully and timely as needed.

• The loss of key personnel, either temporarily or permanently.

• Negative impacts to our sales and marketing efforts due to the postponement or cancellation of face-to-face meetings and restrictions on access by non-essential personnel to hospitals or clinics to the extent such measures slow down adoption or further commercialization of our marketed products.

• Reduced demand for some or all of our marketed products due to, among other factors, shelter-in-place, social distancing, or similar orders.

• Supply chain strains or disruptions (such as port closures and government or other restrictions or limitations, whether resulting from a public health outbreak, epidemic, pandemic, or otherwise, such as those that may be imposed under the Defense Production Act) that result in reduced availability or increased cost of materials produced by or purchased from our suppliers or other third parties on which we rely.

• Microbial, viral, or other contamination of our products, product candidates, the materials used for their production, or in our facilities (or in the facilities of our collaborators, third-party contract manufacturers, or other providers or suppliers), which could result in the closure of or other impact to the affected facilities for an extended period of time, or could result in other delays or disruptions in our direct or indirect supply chain.

• Disruptions to the healthcare and healthcare regulatory systems, which could among other matters, divert healthcare resources away from, or materially delay, regulatory review and potential approval of our product candidates and new indications for our marketed products.

• Pricing pressures, rebates, clawbacks, and other changes in reimbursement policies and programs resulting from the financial strain of a public health outbreak, epidemic, or pandemic on government-funded healthcare systems.

• Risks related to any therapies we may have developed or be in the process of developing in response to any such public health outbreak, epidemic, or pandemic (such as REGEN-COV and our "next generation" monoclonal antibodies targeting SARS-CoV-2), including heightened regulatory scrutiny;

restrictions on administration that limit widespread and timely access to any such therapies;

fluctuations in, or elimination of, demand for any such therapies (including due to the availability of superior or competitive therapies or preventative measures);

mutations of the disease-causing pathogen impacting efficacy;

and revocations of or restrictions on any emergency use authorizations.

• Impacts on our clinical trials due to delays in site initiation and patient enrollment as a result of prioritization of hospital resources to address the public health outbreak, epidemic, or pandemic, patients' inability to comply with clinical trial protocols if quarantines impede patient movement or interrupt healthcare services, and restrictions on trial initiations imposed by hospitals and other trial sites.

Similarly, our ability to recruit and retain patients and principal investigators and site staff could be delayed or disrupted.

Any such disruptions could negatively impact the progress of our clinical trials, including the readouts of trial results, the timing of regulatory review, and any anticipated program milestones.

• Significant disruption to the global financial markets or economy, which may make it more difficult for us to access capital if needed.

In addition, a recession or market correction resulting from a public health outbreak, epidemic, or pandemic could materially affect the value of our Common Stock.

These and similar, and perhaps more severe, disruptions in our operations may materially adversely impact our business, prospects, operating results, and financial condition.

To the extent a public health outbreak, epidemic, or pandemic adversely affects our business, prospects, operating results, or financial condition, it may also have the effect of heightening many of the other risks described in this "Risk Factors" section.

We may need additional funding in the future, which may not be available to us, and which may force us to delay, reduce or eliminate our product development programs or commercialization efforts.

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However, one or more of our collaboration agreements may terminate, our revenues may fall short of our projections or be delayed, or our expenses may increase, any of which could result in our capital being consumed significantly faster than anticipated.

Our expenses may increase for many reasons, including expenses in connection with the commercialization of our marketed products and the potential commercial launches of our product candidates and new indications for our marketed products, manufacturing scale-up, expenses related to clinical trials testing of antibody-based product candidates we are developing on our own (without a collaborator), and expenses for which we are responsible in accordance with the terms of our collaboration agreements.

Our expenses may increase for many reasons, including expenses in connection with the commercialization of our marketed products and the potential commercial launches of our product candidates and new indications for our marketed products, manufacturing scale-up, expenses related to clinical trials testing of product candidates we are developing on our own (without a collaborator), and expenses for which we are responsible in accordance with the terms of our collaboration agreements.

We cannot be certain that our existing capital resources and our current and anticipated revenues will be sufficient to meet our operating needs.

We may require additional financing in the future and we may not be able to raise additional funds on acceptable terms or at all.

For example, there is no guarantee that we will have the ability to pay the principal amount due on our senior unsecured notes at maturity or redeem, repurchase, or refinance the notes prior to maturity on acceptable terms or at all.

For example, there is no guarantee that we will have the ability to pay the principal amount due on

our senior unsecured notes at maturity or redeem, repurchase, or refinance the notes prior to maturity on acceptable terms or at all.

In addition, in March 2022, we completed an extension of the $720.0 million lease financing for our existing corporate headquarters and other rentable area consisting of approximately 150 acres of predominately office buildings and laboratory space located in Tarrytown, New York, which is set to expire in March 2027.

Refer to Part I, Item 2.

"Management's Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources - Tarrytown, New York Leases " for further details.

Our ability to refinance or to obtain additional financing could be adversely affected if there is a significant decline in the demand for our products or other significantly unfavorable changes in economic conditions.

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We have certain indebtedness and contingent liabilities, including milestone and royalty payment obligations.

As of September 30, 2022, we had an aggregate of $2.701 billion of outstanding indebtedness under our senior unsecured notes and the lease financing facility.

As of March 31, 2023, we had an aggregate of $2.702 billion of outstanding indebtedness under our senior unsecured notes and the lease financing facility.

We may also incur additional debt in the future.

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Our revenue from outside the United States will increase as our products, whether marketed or otherwise commercialized by us or our collaborators, gain marketing approval in such jurisdictions.

Our primary foreign currency exposure relates to movements in the Japanese yen, euro, British pound sterling, Canadian dollar, and Australian dollar.

Our primary foreign currency exposure relates to movements in the Japanese yen, euro, British pound sterling, Canadian dollar, Chinese yuan, and Australian dollar.

dollar weakens against a specific foreign currency, our revenues will increase, having a positive impact on net income, but our overall expenses will increase, having a negative impact.

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Therefore, significant changes in foreign exchange rates can impact our operating results and the financial condition of our Company.

For example, as previously reported, the amount of our share of profits we earned in connection with commercialization of antibodies outside the United States was adversely impacted in 2022 by the U.S.

dollar strengthening against foreign currencies, including the Japanese yen and the euro.

Our investments are subject to risks and other external factors that may result in losses or affect the liquidity of these investments.

As of September 30, 2022, we had $3.491 billion in cash and cash equivalents and $9.499 billion in marketable securities (including $1.129 billion in equity securities).

As of March 31, 2023, we had $3.916 billion in cash and cash equivalents and $11.110 billion in marketable securities (including $1.059 billion in equity securities).

Our investments consist primarily of debt securities, including investment-grade corporate bonds.

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If any of our investments suffer market price declines, such declines may have an adverse effect on our financial condition and operating results.

Changes in the method of determining LIBOR, or the replacement of LIBOR with an alternative reference rate, may adversely affect our business, operating results, and financial condition.

We are subject to risks related to uncertainty regarding the London Interbank Offered Rate ("LIBOR"), which is in the process of being phased out.

The publication of U.S.

dollar LIBOR for certain tenors and all non-U.S.

dollar LIBOR tenors ceased after December 31, 2021 (other than certain sterling and Japanese yen settings being published on a synthetic temporary basis).

Banks reporting information used to set U.S.

dollar LIBOR for all other tenors are currently expected to stop doing so after June 30, 2023, although the LIBOR administrator may discontinue or modify LIBOR prior to that date.

In 2021, the U.S.

Federal Reserve Board and certain other regulatory bodies issued guidance encouraging banks and other financial market participants to cease entering into new contracts that use U.S.

dollar LIBOR as a reference rate as soon as practicable and in any event no later than December 31, 2021.

Although regulators in various jurisdictions have been working to replace LIBOR and have encouraged the development and adoption of alternative reference rates, such as SOFR, there continues to be uncertainty regarding the nature of potential changes to and future utilization of specific LIBOR tenors, the development and acceptance of alternative reference rates, and other reforms.

We cannot predict the consequences and timing of these developments or other market or regulatory changes related to the phase-out of LIBOR.

A transition away from LIBOR as a benchmark for establishing the applicable interest rate may adversely affect our outstanding variable-rate indebtedness (if any), as well as floating-rate debt securities in our investment portfolio.

For example, if a published U.S.

dollar LIBOR is unavailable or no longer representative, interest for borrowings (if any) with an interest rate based on LIBOR under our revolving credit facility will be determined using various alternative methods, any of which may result in interest obligations which are more than, or do not otherwise correlate over time with, the payments that would have been made on such debt prior to any LIBOR phase-out.

Risks Related to Our Common Stock

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• progress, delays, or results in clinical trials of our or our competitors' product candidates or new indications for marketed products;

• impact of the COVID-19 pandemic on our business, including any potential future sales of our COVID-19 monoclonal antibodies;

• announcement of technological innovations or product candidates by us or competitors;

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• general market conditions;

• impact of public health outbreaks, epidemics, or pandemics (such as the COVID-19 pandemic) on our business;

• our ability to repurchase our Common Stock under any share repurchase program on favorable terms or at all;

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A small number of our shareholders beneficially own a substantial amount of our Common Stock.

As of September 30, 2022, our five largest shareholders plus Dr.

Schleifer, our Chief Executive Officer, beneficially owned approximately 39.8% of our outstanding shares of Common Stock, assuming, in the case of our Chief Executive Officer, the conversion of his Class A Stock into Common Stock and the exercise of all options held by him which are exercisable within 60 days of September 30, 2022.

As of April 11, 2023, our five largest shareholders plus Dr.

Schleifer, our Chief Executive Officer, beneficially owned approximately 40.4% of our outstanding shares of Common Stock, assuming, in the case of our Chief Executive Officer, the conversion of his Class A Stock into Common Stock and the exercise of all options held by him which are exercisable within 60 days of April 11, 2023.

If our significant shareholders or we sell substantial amounts of our Common Stock in the public market, or there is a perception that such sales may occur, the market price of our Common Stock could fall.

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There can be no assurance that we will repurchase shares of our Common Stock or that we will repurchase shares at favorable prices.

In November 2021, our board of directors authorized a share repurchase program to repurchase up to $3.0 billion of our Common Stock (of which $1.186 billion remained available as of September 30, 2022).

In November 2021, our board of directors authorized a share repurchase program to repurchase up to $3.0 billion of our Common Stock;

and, in January 2023, our board of directors authorized an additional $3.0 billion for share repurchases (of which $3.051 billion remained available in the aggregate as of March 31, 2023).

There can be no assurance of any future share repurchases or share repurchase program authorizations.

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Holders of Class A Stock, who are generally the shareholders who purchased their stock from us before our initial public offering, are entitled to ten votes per share, while holders of Common Stock are entitled to one vote per share.

As of September 30, 2022, holders of Class A Stock held 14.5% of the combined voting power of all shares of Common Stock and Class A Stock then outstanding.

As of April 11, 2023, holders of Class A Stock held 14.4% of the combined voting power of all shares of Common Stock and Class A Stock then outstanding.

These shareholders, if acting together, would be in a position to substantially influence the election of our directors and the vote on certain corporate transactions that require majority or supermajority approval of the combined classes, including mergers and other business combinations.

This may result in our taking corporate actions that other shareholders may not consider to be in their best interest and may affect the price of our Common Stock.

As of September 30, 2022:

• our current executive officers and directors beneficially owned 7.0% of our outstanding shares of Common Stock, assuming conversion of their Class A Stock into Common Stock and the exercise of all options held by such persons which are exercisable within 60 days of September 30, 2022, and 18.5% of the combined voting power of our outstanding shares of Common Stock and Class A Stock, assuming the exercise of all options held by such persons which are exercisable within 60 days of September 30, 2022;

As of April 11, 2023:

• our current executive officers and directors beneficially owned 7.0% of our outstanding shares of Common Stock, assuming conversion of their Class A Stock into Common Stock and the exercise of all options held by such persons which are exercisable within 60 days of April 11, 2023, and 18.4% of the combined voting power of our outstanding shares of Common Stock and Class A Stock, assuming the exercise of all options held by such persons which are exercisable within 60 days of April 11, 2023;

• our five largest shareholders plus Dr.

In addition, these five shareholders plus our Chief Executive Officer held approximately 46.9% of the combined voting power of our outstanding shares of Common Stock and Class A Stock, assuming the exercise of all options held by our Chief Executive Officer which are exercisable within 60 days of September 30, 2022.

In addition, these five shareholders plus our Chief Executive Officer held approximately 47.4% of the combined voting power of our outstanding shares of Common Stock and Class A Stock, assuming the exercise of all options held by our Chief Executive Officer which are exercisable within 60 days of April 11, 2023.

The anti-takeover effects of provisions of our charter, by-laws, and of New York corporate law, as well as the contractual provisions in our investor and collaboration agreements and certain provisions of our compensation plans and agreements, could deter, delay, or prevent an acquisition or other "change of control" of us and could adversely affect the price of our Common Stock.

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• under the New York Business Corporation Law, in addition to certain restrictions which may apply to "business combinations" involving our Company and an "interested shareholder," a plan of merger or consolidation of our Company must be approved by two-thirds of the votes of all outstanding shares entitled to vote thereon.

See the risk factor above captioned " Our existing shareholders may be able to exert significant influence over matters requiring shareholder approval and over our management.

Further, Sanofi, Bayer, and Teva are currently bound by certain "standstill" provisions under the January 2014 amended and restated investor agreement between us and Sanofi, as amended;

our 2016 ANG2 license and collaboration agreement with Bayer;

and our 2016 collaboration agreement with Teva, respectively.

These provisions contractually prohibit Sanofi, Bayer, and Teva from seeking to directly or indirectly exert control of our Company or acquiring more than a specified percentage of our Class A Stock and Common Stock, taken together (30% in the case of Sanofi, 20% in the case of Bayer, and 5% in the case of Teva).

See the risk factor above captioned " Our existing shareholders may be able to exert substantial influence over matters requiring shareholder approval and over our management.

Further, certain of our collaborators are currently bound by "standstill" provisions under their respective agreements with us.

These include the January 2014 amended and restated investor agreement between us and Sanofi, as amended, and our 2016 ANG2 license and collaboration agreement with Bayer, which contractually prohibit Sanofi and Bayer, respectively, from seeking to directly or indirectly exert control of our Company or acquiring more than a specified percentage of our Class A Stock and Common Stock, taken together (30% in the case of Sanofi and 20% in the case of Bayer).

In addition, our Change in Control Severance Plan and the employment agreement with our Chief Executive Officer, each as amended and restated, provide for severance benefits in the event of termination as a result of a change in control of our Company.

2 unchanged sentences

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-Q

Item 1A. Risk Factors