What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2023-08-03 compared with 2023-05-04 · 175 added, 108 removed, 530 unchanged (35% of the section changed)

33 unchanged sentences

Three Months Ended

June 30, Six Months Ended

(In millions, except per share data) 2023 2022 2023 2022

5 unchanged sentences

Product Disease Territory

EU Japan ROW (e)

EU Japan Other (e)

EYLEA (aflibercept) Injection (a)

15 unchanged sentences

Disease Territory

EU Japan ROW (e)

EU Japan Other (e)

Dupixent (dupilumab) Injection (b) (continued)

Eosinophilic esophagitis ("EoE") (in adults and adolescents)

Prurigo nodularis a a a

Prurigo nodularis a a a a

Libtayo (cemiplimab) Injection (c)

32 unchanged sentences

(d) The Company is solely responsible for the development and commercialization of Praluent in the United States, and Sanofi is solely responsible for the development and commercialization of Praluent outside of the United States.

(e) Rest of world ("ROW").

A checkmark in this column indicates that the product has received marketing approval in at least one country outside of the United States, European Union ("EU"), or Japan.

(e) A checkmark in this column indicates that the product has received marketing approval in at least one country outside of the United States, European Union ("EU"), or Japan.

(f) Known as REGEN-COV in the United States and Ronapreve ™ in other countries.

6 unchanged sentences

(In millions) U.S.

ROW Total (Total Sales)

$ 1,500.1 $ 886.3 $ 2,386.4 $ 1,621.2 $ 869.8 $ 2,491.0 (4 %)

$ 2,105.2 $ 684.2 $ 2,789.4 $ 1,582.1 $ 509.7 $ 2,091.8 33 %

$ 130.2 $ 79.8 $ 210.0 $ 90.9 $ 50.4 $ 141.3 49 %

$ 40.5 $ 99.8 $ 140.3 $ 31.2 $ 77.7 $ 108.9 29 %

REGEN-COV (e)

$ — $ — $ — $ — $ 22.8 $ 22.8 (100 %)

$ 56.9 $ 42.6 $ 99.5 $ 43.0 $ 39.3 $ 82.3 21 %

Other products (f)

$ 22.5 $ 16.9 $ 39.4 $ 12.1 $ 19.0 $ 31.1 27 %

Six Months Ended

2023 2022 % Change

(In millions) U.S.

ROW Total U.S.

18 unchanged sentences

Refer to "Collaboration, License, and Other Agreements" section below for further details.

Included in this line item is approximately $6 million of net product sales recorded by Sanofi in the first quarter of 2023 in connection with sales in certain markets outside the United States (Sanofi records net product sales in such markets during a transition period until inventory on hand as of July 1, 2022 is sold through to the end customers).

Included in this line item for the six months ended June 30, 2023 is $6 million of first quarter 2023 net product sales recorded by Sanofi in connection with sales in certain markets outside the United States (Sanofi recorded net product sales in such markets during a transition period until inventory on hand as of July 1, 2022 had been sold through to the end customers).

(d) Regeneron records net product sales of Praluent in the United States.

5 unchanged sentences

Not included in this line item are net product sales of ARCALYST, which are recorded by Kiniksa;

net product sales of ARCALYST were $40 million for the fourth quarter of 2022.

net product sales of ARCALYST were $43 million for the first quarter of 2023.

(g) Rest of world ("ROW")

Programs in Clinical Development

13 unchanged sentences

–Wet AMD and DME (U.S., EU, and Japan)

–FDA decision on BLA for wet AMD, DME, and DR (target action date of June 27, 2023)

–European Commission ("EC") and Ministry of Health, Labour and Welfare ("MHLW") decision on regulatory submissions for wet AMD and DME (first half 2024)

–Report two-year data from Phase 3 studies in wet AMD and DME (third quarter 2023)

–FDA issued Complete Response Letter ("CRL") for Biologics License Application ("BLA") for wet AMD, DME, and DR due to unresolved observations resulting from an inspection at third-party contract manufacturer

–Resubmitted BLA for wet AMD, DME, and DR

–Reported positive two-year data from Phase 3 study in DME

–FDA decision on BLA for wet AMD, DME, and DR

–European Commission ("EC") and Japan's Ministry of Health, Labour and Welfare ("MHLW") decision on regulatory submissions for wet AMD and DME (fourth quarter 2023/first half 2024)

–Report two-year data from Phase 3 study in wet AMD (third quarter 2023)

Immunology & Inflammation

4 unchanged sentences

–EoE in pediatrics (c)

–Chronic obstructive pulmonary disease ("COPD")

–Chronic obstructive pulmonary disease ("COPD") (d)

–Bullous pemphigoid (c)

2 unchanged sentences

–Atopic dermatitis in pediatrics and adolescents (6 months–14 years of age) (Japan)

–Prurigo nodularis (Japan)

–CSU in adults and adolescents (U.S.

1 unchanged sentence

–Approved by EC for EoE in adults and adolescents

–Approved by MHLW for prurigo nodularis

–Reported that Phase 3 trial in COPD with evidence of type 2 inflammation met its primary and all key secondary endpoints;

–Phase 3 trial in chronic cold induced urticaria did not meet its required efficacy endpoints

–MHLW decision on regulatory submission for atopic dermatitis in pediatrics and adolescents (6 months–14 years of age) in Japan (second half 2023)

–Submit sBLA for EoE in pediatrics (mid-2023)

presented at 2023 American Thoracic Society International Conference and published in New England Journal of Medicine

–MHLW decision on regulatory submission for atopic dermatitis in pediatrics and adolescents (6 months–14 years of age) (second half 2023)

–Supplemental BLA ("sBLA") filing acceptance and submission of regulatory application in the EU for EoE in pediatrics (second half 2023)

–Report results from replicate Phase 3 trial in COPD (mid-2024)

–FDA decision on sBLA (target action date of October 22, 2023) and MHLW decision on regulatory submission (first half 2024) for CSU in adults and adolescents

Clinical Program (continued)

2 unchanged sentences

Dupixent (dupilumab) (b)

–Phase 3 trial in chronic cold induced urticaria did not meet its required efficacy endpoints

–Discontinued further clinical development in allergic fungal rhinosinusitis and chronic rhinosinusitis without nasal polyposis

–FDA decision on sBLA (target action date of October 22, 2023) and MHLW decision on regulatory submission (first half 2024) for CSU in adults and adolescents

Kevzara (sarilumab) (b)

5 unchanged sentences

Antibody to IL-33

–Phase 3 COPD program passed interim futility analysis conducted by Independent Data Monitoring Committee ("IDMC")

–Report results from Phase 3 study in COPD (2025)

5 unchanged sentences

Antibody to PD-1

–First-line NSCLC, BNT116 combination

–Neoadjuvant CSCC

–Second-line cervical cancer, ISA101b combination

–First-line NSCLC, BNT116 (s) combination

–Adjuvant CSCC

–Approved by EC for first-line NSCLC, chemotherapy combination

Clinical Program (continued)

Phase 1 Phase 2 Phase 3 Regulatory Review (h)

2023 Events to Date Select Upcoming Milestones

Fianlimab (f) (REGN3767)

2 unchanged sentences

–First-line metastatic melanoma

–First-line adjuvant melanoma

–Initiate Phase 3 study (in combination with Libtayo) in perioperative melanoma (second half 2023)

–First-line adjuvant melanoma –Presented positive data from Phase 1 trial (in combination with Libtayo) in advanced melanoma at 2023 American Society of Clinical Oncology ("ASCO") Annual Meeting

–Initiate potentially pivotal Phase 2 study (in combination with Libtayo) in perioperative melanoma (second half 2023)

–Initiate Phase 2 study (in combination with Libtayo) in perioperative NSCLC (second half 2023)

Immune activator targeting TLR9

–Solid tumors –Initiate Phase 2 study in melanoma

Clinical Program (continued)

Phase 1 Phase 2 Phase 3 Regulatory Review (h)

2023 Events to Date Select Upcoming Milestones

–Solid tumors

Ubamatamab (f)

5 unchanged sentences

Bispecific antibody targeting PSMA and CD28

–Prostate cancer

–Report additional results from Phase 1/2 study (in combination with Libtayo) in prostate cancer (second half 2023/first half 2024)

–Prostate cancer –Discontinued enrollment in cohorts in combination with full-dose Libtayo

–Report additional results from Phase 1/2 study (in combination with Libtayo) in prostate cancer (2024)

Bispecific antibody targeting PSMA and CD3

9 unchanged sentences

–Solid tumors

Clinical Program (continued)

Phase 1 Phase 2 Phase 3 Regulatory Review (h)

2023 Events to Date Select Upcoming Milestones

Odronextamab (i) (REGN1979)

3 unchanged sentences

("B-NHL") (m) (pivotal study)

–Initiate Phase 3 studies in follicular lymphoma ("FL") and diffuse large B-cell lymphoma ("DLBCL"), including earlier lines of therapy (second quarter 2023)

Clinical Program (continued)

Phase 1 Phase 2 Phase 3 Regulatory Review (h)

2023 Events to Date Select Upcoming Milestones

Odronextamab (i) (REGN1979)

–Submit BLA and Marketing Authorization Application ("MAA") for relapsed/refractory FL and DLBCL (second half 2023)

–Relapsed/refractory FL and DLBCL (EU) –Initiate Phase 3 studies in follicular lymphoma ("FL") and diffuse large B-cell lymphoma ("DLBCL"), including earlier lines of therapy (second half 2023)

–BLA filing acceptance for relapsed/refractory FL and DLBCL (second half 2023)

Bispecific antibody targeting CD22 and CD28

3 unchanged sentences

–Multiple myeloma (pivotal study) (c)(e)

–Initiate Phase 3 study in multiple myeloma, including earlier lines of therapy (mid-2023)

–Submit BLA for relapsed/refractory multiple myeloma (second half 2023)

–Presented updated positive data from pivotal trial in multiple myeloma at ASCO Annual Meeting –Initiate Phase 3 study in multiple myeloma, including earlier lines of therapy (third quarter 2023)

–Present data from pivotal study in multiple myeloma (fourth quarter 2023)

–Submit BLA for relapsed/refractory multiple myeloma (fourth quarter 2023)

Bispecific antibody targeting BCMA and CD3

4 unchanged sentences

–CD55-deficient protein-losing enteropathy ("CHAPLE"), monotherapy (c)(e) (potentially pivotal study)

–Myasthenia gravis, cemdisiran combination (k)

–Paroxysmal nocturnal hemoglobinuria ("PNH"), cemdisiran combination (c)(k)

–Myasthenia gravis, cemdisiran combination (t)

–Paroxysmal nocturnal hemoglobinuria ("PNH"), cemdisiran combination (c)(t)

–CHAPLE, monotherapy (adults and children aged 1 year and older) (U.S.)

–FDA decision on BLA for CHAPLE, monotherapy (target action date of August 20, 2023)

–FDA decision on BLA for pozelimab monotherapy for CHAPLE (target action date of August 20, 2023)

Clinical Program (continued)

Phase 1 Phase 2 Phase 3 Regulatory Review (h)

2023 Events to Date Select Upcoming Milestones

Antibody to IL2Rg

7 unchanged sentences

–Transfusion dependent iron overload

Clinical Program (continued)

Phase 1 Phase 2 Phase 3 Regulatory Review (h)

2023 Events to Date Select Upcoming Milestones

General Medicine

1 unchanged sentence

Antibodies to SARS-CoV-2 variants

–Initiate clinical development of "next generation" antibody (mid-2023)

–Initiate clinical development of "next generation" antibody (second half 2023)

Praluent (alirocumab)

Antibody to PCSK9

–HeFH in pediatrics –Submit sBLA for HeFH in pediatrics (mid-2023)

–HeFH in pediatrics and adolescents

–HeFH in pediatrics and adolescents (8–17 years of age) (U.S.)

–FDA decision on sBLA for HeFH in pediatrics and adolescents (target action date of March 10, 2024)

Evkeeza (evinacumab) (f)(l)

Antibody to ANGPTL3

–HoFH in pediatrics (5–11 years of age) (EU)

–HoFH in adults, adolescents, and pediatrics (5–11 years of age) (Japan)

–Approved by FDA for HoFH in pediatrics (5–11 years of age)

7 unchanged sentences

–Partial lipodystrophy

Clinical Program (continued)

Phase 1 Phase 2 Phase 3 Regulatory Review (h)

2023 Events to Date Select Upcoming Milestones

REGN5381/REGN9035

Agonist antibody to NPR1/reversal agent to REGN5381

–Reversal agent in healthy volunteers –Heart failure –Report initial data in healthy volunteers (2023)

–Reversal agent in healthy volunteers –Heart failure –Paused enrollment in Phase 1 and Phase 2 studies pending protocol amendment

–Report initial data in healthy volunteers (second half 2023)

RNAi therapeutic targeting HSD17B13

5 unchanged sentences

–Reported positive interim data from single dose part of Phase 1 trial in early-onset Alzheimer’s disease

AAV-based gene therapy

–Hearing loss in pediatrics (c) (Phase 1/2)

For purposes of the table above, a program is classified in Phase 1, 2, or 3 clinical development after recruitment for the corresponding study or studies has commenced.

19 unchanged sentences

by the FDA due to findings observed in prior non-clinical chronic toxicology studies.

(r) In collaboration with Decibel

(s) BioNTech's BNT116 is an mRNA cancer vaccine

(t) Under the terms of our license agreement for the combination consisting of cemdisiran and pozelimab, Alnylam is entitled to receive royalties on sales of the combination (if any), as well as sales milestones.

Additional Information - Clinical Development Programs

Aflibercept 8 mg

In June 2023, the FDA issued a CRL for the BLA for aflibercept 8 mg for the treatment of patients with wet AMD, DME, and DR.

The CRL was issued solely due to unresolved observations resulting from a May 2023 FDA inspection at a third-party contract manufacturing organization, Catalent, that the Company engaged to complete vial-filling for aflibercept 8 mg.

The CRL did not identify any issues with the aflibercept 8 mg clinical efficacy or safety profile, trial design, labeling, or drug substance manufacturing, and no additional clinical data or trials have been requested.

The May 2023 inspection was conducted as part of the FDA review process for both the aflibercept 8 mg BLA and the pending BLA for pozelimab, as both product candidates are filled on the same manufacturing line in Catalent's facility.

Catalent has already provided certain manufacturing data and other information to the FDA, and expects to be able to provide the remaining required data and information in August 2023.

The FDA has stated that its review of the Catalent manufacturing data in the context of the pozelimab BLA will support actions for both the pozelimab BLA and the aflibercept 8 mg BLA resubmission.

The FDA has also informed the Company that it will strive to complete its review prior to the target action date for the pozelimab BLA (August 20, 2023), and, if unable to do so, may extend its review by up to 3 months while still continuing to prioritize the review.

Based on this information, the Company anticipates the FDA will act on the pozelimab and aflibercept 8 mg BLAs before the end of the third quarter 2023.

In June 2023, the Company announced top-line, two-year (96 weeks) data for aflibercept 8 mg from the pivotal PHOTON trial in patients with DME.

In addition, in July 2023, the results were presented at the American Society of Retina Specialists annual meeting.

During the trial, aflibercept 8 mg patients were initially randomized to either 12- or 16-week dosing intervals (after three initial monthly doses) and were able to shorten or extend dosing intervals if pre-specified criteria were met.

The longer-term data among aflibercept 8 mg patients who completed the trial demonstrated that the vast majority of patients were able to maintain or further extend these dosing intervals through two years with:

• 89% maintaining ≥12-week dosing intervals through two years, compared to 93% through one year (48 weeks);

• 84% maintaining ≥16-week dosing intervals through two years, compared to 89% maintaining a 16-week dosing interval through one year;

• 44% meeting the criteria for ≥20-week dosing intervals by week 96, including 17% and 27% who were eligible for 20- and 24-week dosing intervals, respectively.

The visual gains for aflibercept 8 mg remained consistent with the first year of the trial.

In PHOTON, the safety of aflibercept 8 mg also continued to be similar to EYLEA through two years and remained consistent with the known safety profile of EYLEA from previous clinical trials for DME.

In May 2023, Bayer announced that it initiated a Phase 3 study to evaluate the efficacy and safety of aflibercept 8 mg at extended dosing intervals compared to the standard of care, EYLEA, in RVO to support potential future regulatory submissions outside the United States.

In March 2023, the Company and Sanofi announced that the primary and all key secondary endpoints were met in the BOREAS trial (the first of two Phase 3 trials) in adults currently on maximal standard-of-care inhaled therapy (triple therapy) with uncontrolled COPD and evidence of type 2 inflammation.

1 unchanged sentence

The safety results were generally consistent with the known safety profile of Dupixent in its approved indications.

In the ongoing Phase 1 study of REGN5678, the Company has observed antitumor activity in combination with Libtayo as well as with REGN5678 monotherapy.

Due to the emerging safety profile, including two immune-mediated Grade 5 adverse events (death), one of which occurred in July 2023, the Company has discontinued enrollment of patients receiving the combination of REGN5678 and full-dose Libtayo.

The Company plans to explore REGN5678 combinations with lower doses of Libtayo.

The Company also plans to enroll patients in a REGN5678 monotherapy cohort, as well as in combination with other immunotherapy modalities.

In April 2023, the Company and Alnylam Pharmaceuticals, Inc.

reported positive interim data from the single dose portion of the Phase 1 study of ALN-APP in early-onset Alzheimer’s disease.

Alnylam announced incremental data at the 2023

Alzheimer’s Association International Conference ("AAIC") in July 2023.

The Phase 1 trial is ongoing, with safety and efficacy trends to be further evaluated as more data are gathered.

As described in the "Collaboration, License, and Other Agreements - Alnylam" section below, Alnylam is eligible to receive a $100.0 million development milestone from us upon achieving specified clinical proof-of-principle criteria for a central nervous system ("CNS") program (including the ALN-APP program).

Collaboration, License, and Other Agreements

28 unchanged sentences

Agreed-upon development expenses incurred by the Company and Bayer are generally shared equally.

Bayer markets EYLEA outside the United States, and the companies share equally in profits and losses from such sales.

Bayer is responsible for commercialization activities outside the United States, and the companies share equally in profits and losses from such sales.

We are obligated to reimburse Bayer for 50% of the development costs that it has incurred under the agreement from our share of the collaboration profits.

1 unchanged sentence

Within the United States, we retain exclusive commercialization rights and are entitled to all profits from such sales.

In 2018, we and Alnylam Pharmaceuticals, Inc.

entered into a collaboration to discover RNA interference ("RNAi") therapeutics for NASH and potentially other related diseases, as well as to research, co-develop and commercialize any therapeutic product candidates that emerge from these discovery efforts (including ALN-HSD, which is currently in clinical development).

Under the terms of the collaboration agreement, the parties share development costs equally.

During the fourth quarter of 2022, Alnylam elected to opt-out of further development activities related to ALN-HSD;

as a result, we retain the exclusive right to develop and commercialize such product and Alnylam will receive a royalty on sales, if any.

In 2019, we and Alnylam entered into a global, strategic collaboration to discover, develop, and commercialize RNAi therapeutics for a broad range of diseases by addressing therapeutic disease targets expressed in the eye and central nervous system ("CNS"), in addition to a select number of targets expressed in the liver.

In 2019, we and Alnylam entered into a global, strategic collaboration to discover, develop, and commercialize RNAi therapeutics for a broad range of diseases by addressing therapeutic disease targets expressed in the eye and central nervous system, in addition to a select number of targets expressed in the liver.

In connection with the collaboration, the Company made an up-front payment of $400.0 million to Alnylam, and also purchased shares of Alnylam common stock for $400.0 million.

4 unchanged sentences

In addition, we have an option to extend the Research Term for an additional five-year period for a research extension fee of $300.0 million.

At the stage of designation of a lead candidate for CNS programs and liver programs, the parties have alternating rights to be a lead party for collaboration products.

At the stage of designation of a lead candidate for eye programs, we have the sole right to take the product forward as a licensee.

The lead party is required to take the program forward under the License Agreement structure unless the other party exercises its rights to opt-in to a Co-Co Collaboration Agreement as a participating party, in which case the lead party is required to take the program forward under the Co-Co Collaboration Agreement structure.

Alnylam does not have rights to opt-in to a Co-Co Collaboration Agreement for eye programs.

Under a License Agreement, the lead party is designated as the licensee and has the right to develop and commercialize the collaboration product under such program.

The licensee will be responsible for its own costs and expenses incurred in connection with the development and commercialization of the collaboration products under the License Agreement.

The licensee will pay to the licensor certain development and/or commercialization milestone payments, as well as certain tiered royalty payments to the licensor based on the aggregate annual net sales of the collaboration product.

For CNS programs and liver programs, under a Co-Co Collaboration Agreement, the party designated as the lead party will lead development and commercialization of the program and the parties will split profits and share costs equally, subject to certain co-funding opt-outs at specified clinical trial phases or under other conditions.

If a party exercises its co-funding opt-out right,

the lead party will be required to make certain tiered royalty payments to the other party based on the aggregate annual net sales of the collaboration product and the timing of the exercise of the co-funding opt-out right.

Under the terms of the collaboration, when we are the licensee under a License Agreement or the lead party under a Co-Co Collaboration Agreement, Alnylam will be responsible for the manufacture and supply of the product to us for Phase 1 and Phase 2 clinical trials.

In addition, during 2019, the parties entered into a Co-Co Collaboration Agreement for cemdisiran, a small interfering RNA ("siRNA") therapeutic targeting the C5 component of the human complement pathway being developed by Alnylam, with Alnylam as the lead party, and a License Agreement for a combination consisting of cemdisiran and pozelimab, with us as the licensee.

Under the C5 siRNA Co-Co Collaboration Agreement, the parties shared costs equally, and under the License Agreement, we as the licensee are responsible for our own costs and expenses.

The C5 siRNA License Agreement contains a flat low double-digit royalty payable to Alnylam on potential future net sales of the combination only subject to customary reductions, as well as up to $325.0 million in sales milestones.

During the fourth quarter of 2022, we elected to opt-out of further development activities pursuant to the Co-Co Collaboration Agreement for cemdisiran as a monotherapy;

as a result, Alnylam retains the right to develop and commercialize such product and we will receive a royalty on sales (if any).

Alnylam is the lead party for ALN-APP, and we are the lead party for ALN-PNP.

In addition, during 2019, the parties entered a License Agreement for a combination consisting of cemdisiran (a small interfering RNA ("siRNA") therapeutic targeting the C5 component of the human complement pathway being developed by Alnylam) and pozelimab, with us as the licensee.

Under the License Agreement, we as the licensee are responsible for our own costs and expenses.

In 2016, we entered into a license and collaboration agreement with Intellia Therapeutics, Inc.

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In addition, our research and development activities and related costs which are not reimbursed are expected to expand and require additional resources.

We also expect to incur substantial costs related to the commercialization of our marketed products.

We also expect to incur substantial costs related to the commercialization of our

marketed products.

Our financial results may fluctuate from quarter to quarter and will depend on, among other factors, the net sales of our products;

12 unchanged sentences

Results of Operations

Three Months Ended March 31, 2023 and 2022

Three and Six Months Ended June 30, 2023 and 2022

Three Months Ended

June 30, Six Months Ended

(In millions, except per share data) 2023 2022 2023 2022

8 unchanged sentences

Three Months Ended

(In millions) 2023 2022 $ Change

June 30, Six Months Ended

(In millions) 2023 2022 $ Change 2023 2022 $ Change

Net product sales:

6 unchanged sentences

Evkeeza - U.S.

19.3 11.1 8.2 34.2 19.6 14.6

Inmazeb - U.S.

2.2 — 2.2 4.4 — 4.4

Total net product sales $ 1,772.1 $ 1,754.4 $ 17.7 $ 3,440.1 $ 3,393.0 $ 47.1

8 unchanged sentences

Net Product Sales

Net product sales of EYLEA in the United States decreased for the three months ended March 31, 2023, compared to the same period in 2022, primarily due to an increase in sales-related deductions, partly offset by higher sales volume.

Net product sales of EYLEA in the United States decreased for the three and six months ended June 30, 2023, compared to the same periods in 2022, primarily due to a lower net selling price resulting from increased competition.

As described in "Collaboration, License, and Other Agreements - Sanofi - Immuno-Oncology " above, effective July 1, 2022, the Company became solely responsible for the research, development, and commercialization of Libtayo worldwide and began recording net product sales of Libtayo outside the United States.

2 unchanged sentences

Three Months Ended

June 30, Six Months Ended

(In millions) 2023 2022 2023 2022

2 unchanged sentences

Reimbursement for manufacturing of commercial supplies (a)

192.6 145.5 354.5 306.3

Other — 28.9 — 28.9

Total Antibody 943.7 671.0 1,742.1 1,297.1

4 unchanged sentences

As described above under "Collaboration, License, and Other Agreements - Sanofi - Antibody ", on July 1, 2022, an amendment to the LCA became effective, pursuant to which the percentage of Regeneron's share of profits in any calendar quarter used to reimburse Sanofi for development costs which were funded by Sanofi increased from 10% to 20%.

The increase in our share of profits in connection with commercialization of antibodies during the three months ended March 31, 2023, compared to the same period in 2022, was driven by profits associated with higher Dupixent sales, partly offset by the impact of the amendment to the LCA.

The increase in our share of profits in connection with commercialization of antibodies during the three and six months ended June 30, 2023, compared to the same periods in 2022, was driven by higher profits associated with Dupixent sales, partly offset by the impact of the amendment to the LCA.

Regeneron's share of profits in connection with the commercialization of Dupixent and Kevzara is summarized below:

Three Months Ended

June 30, Six Months Ended

(In millions) 2023 2022 2023 2022

7 unchanged sentences

Regeneron's share of collaboration profits as a percentage of Dupixent and Kevzara net product sales 26% 23% 25% 22%

During the three months ended March 31, 2022, the Company earned a $50.0 million sales-based milestone from Sanofi, upon aggregate annual sales of antibodies outside the United States (including Praluent) exceeding $2.0 billion on a rolling twelve-month basis.

During the six months ended June 30, 2022, the Company earned a $50.0 million sales-based milestone from Sanofi, upon aggregate annual sales of antibodies outside the United States (including Praluent) exceeding $2.0 billion on a rolling twelve-month basis.

As the A&R IO LCA became effective July 1, 2022, the three months ended June 30, 2022 was the last period in which Sanofi collaboration revenue was recognized in connection with the IO Collaboration.

1 unchanged sentence

Three Months Ended

June 30, Six Months Ended

(In millions) 2023 2022 2023 2022

2 unchanged sentences

commercial supplies (a)

27.2 17.8 52.5 42.8

One-time payment in connection with change in Japan arrangement (b)

6 unchanged sentences

Three Months Ended

June 30, Six Months Ended

(In millions) 2023 2022 2023 2022

9 unchanged sentences

Three Months Ended

June 30, Six Months Ended

(In millions) 2023 2022 2023 2022

Global gross profit payment from Roche in connection with sales of Ronapreve $ — $ 8.2 $ 222.2 $ 224.5

Other (3.8) — (3.8) —

Total Roche collaboration revenue $ (3.8) $ 8.2 $ 218.4 $ 224.5

Roche distributes and records net product sales of Ronapreve outside the United States, and the parties share gross profits from worldwide sales.

Three Months Ended

(In millions, except headcount data) 2023 2022 Change

June 30, Six Months Ended

(In millions, except headcount data) 2023 2022 Change 2023 2022 Change

Research and development (a)

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(a) Includes costs incurred net of any cost reimbursements from collaborators who are not deemed to be our customers

(b) Cost of collaboration and contract manufacturing includes costs we incur in connection with producing commercial drug supplies for collaborators and others.

Operating expenses included a total of $238.7 million and $166.9 million for the three months ended March 31, 2023 and 2022, respectively, of stock-based compensation expense related to equity awards granted under our long-term incentive plans.

(b) Includes costs we incur in connection with producing commercial drug supplies for collaborators and others

Operating expenses included stock-based compensation of $202.0 million and $159.8 million for the three months ended June 30, 2023 and 2022, respectively, and $440.7 million and $326.7 million for the six months ended June 30, 2023 and 2022, respectively.

Stock-based compensation expense relates to equity awards granted under our long-term incentive plans.

Research and Development Expenses

6 unchanged sentences

Three Months Ended

June 30, Six Months Ended

(In millions) 2023 2022 *

$ Change 2023 2022 *

Direct research and development expenses:

Dupixent (dupilumab) $ 50.1 $ 40.1 $ 10.0 $ 99.3 $ 72.2 $ 27.1

Fianlimab 34.8 3.4 31.4

Libtayo (cemiplimab) 32.9 38.6 (5.7)

Aflibercept 8 mg 27.9 13.6 14.3 53.6 33.8 19.8

Odronextamab 22.1 11.5 10.6

Linvoseltamab 26.3 11.7 14.6 41.1 17.1 24.0

Libtayo (cemiplimab) 25.4 37.2 (11.8) 58.3 75.8 (17.5)

Odronextamab 19.6 13.9 5.7 41.8 25.3 16.5

Fianlimab 18.1 4.6 13.5 52.9 8.0 44.9

Other product candidates in clinical development and other research programs

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* Certain prior year amounts have been reclassified to conform to the current year's presentation.

Total research and development expenses increased for the three months ended March 31, 2023, compared to the same period in 2022, partially due to the impact of the amendments to the Sanofi collaboration agreements (which were effective July 1, 2022) described under the "Collaboration, License, and Other Agreements" section above, as (i) Sanofi is no longer reimbursing us for 50% of Libtayo development costs and (ii) we recognize our 50% share of research and development expenses in connection with the Sanofi Antibody Collaboration.

Research and development expenses included stock-based compensation expense of $139.5 million and $92.4 million for the three months ended March 31, 2023 and 2022, respectively.

Total research and development expenses increased for the three and six months ended June 30, 2023, compared to the same periods in 2022, partially due to the impact of the amendments to the Sanofi collaboration agreements (which were effective July 1, 2022) described under the "Collaboration, License, and Other Agreements" section above, as (i) Sanofi is no longer reimbursing us for 50% of Libtayo development costs (such reimbursements were previously included in Reimbursement of research and development expenses by collaborators in the table above) and (ii) we recognize our 50% share of research and development expenses in connection with the Sanofi Antibody Collaboration.

Clinical manufacturing costs for the three and six months ended June 30, 2023 increased due to manufacturing activity associated with our earlier-stage product candidates.

Research and development expenses included stock-based compensation expense of $109.1 million and $89.7 million for the three months ended June 30, 2023 and 2022, respectively, and $248.6 million and $182.1 million for the six months ended June 30, 2023 and 2022, respectively.

There are numerous uncertainties associated with drug development, including uncertainties related to safety and efficacy data from each phase of drug development, uncertainties related to the enrollment and performance of clinical trials, changes in regulatory requirements, changes in the competitive landscape affecting a product candidate, and other risks and uncertainties described in Part II, Item 1A.

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Acquired In-process Research and Development ("IPR&D")

Acquired IPR&D for the three months ended March 31, 2023 included a $45.0 million up-front payment in connection with our collaboration agreement with Sonoma Biotherapeutics, Inc.

Acquired IPR&D for the three months ended March 31, 2022

included a $20.0 million opt-in payment in connection with a product candidate under our collaboration agreement with Adicet Bio, Inc.

Acquired IPR&D for the six months ended June 30, 2023 included a $45.0 million up-front payment in connection with our collaboration agreement with Sonoma Biotherapeutics, Inc.

Acquired IPR&D for the three and six months ended June 30, 2022 included a $195.0 million charge related to the Company's acquisition of Checkmate Pharmaceuticals, Inc.

Additionally, Acquired IPR&D for the six months ended June 30, 2022 included a $20.0 million opt-in payment in connection with a product candidate under our collaboration agreement with Adicet Bio, Inc.

Selling, General, and Administrative Expenses

Selling, general, and administrative expenses increased for the three months ended March 31, 2023, compared to the same period in 2022, primarily due to an increase in commercialization-related expenses for Libtayo outside the United States (as effective July 1, 2022, the Company became solely responsible for the commercialization of Libtayo worldwide), higher headcount and headcount-related costs, and higher contributions to an independent not-for-profit patient assistance organization.

These increases were partly offset by a decrease in commercialization-related expenses for EYLEA.

Selling, general, and administrative expenses also included stock-based compensation expense of $76.8 million and $60.7 million for the three months ended March 31, 2023 and 2022, respectively.

Selling, general, and administrative expenses increased for the three and six months ended June 30, 2023, compared to the same periods in 2022, primarily due to an increase in commercialization-related expenses and integration costs for Libtayo outside the United States (as effective July 1, 2022, the Company became solely responsible for the commercialization of Libtayo worldwide), higher headcount and headcount-related costs, and higher contributions to an independent not-for-profit patient assistance organization.

Selling, general, and administrative expenses included stock-based compensation expense of $73.3 million and $57.5 million for the three months ended June 30, 2023 and 2022, respectively, and $150.1 million and $118.2 million for the six months ended June 30, 2023 and 2022, respectively.

Cost of Collaboration and Contract Manufacturing

Cost of collaboration and contract manufacturing increased for the three months ended March 31, 2023, compared to the same period in 2022, primarily due to the recognition of costs in connection with manufacturing commercial supplies for Sanofi related to Praluent outside the United States and Dupixent globally.

Cost of collaboration and contract manufacturing increased for the three and six months ended June 30, 2023, compared to the same periods in 2022, primarily due to the recognition of costs in connection with manufacturing commercial supplies of Dupixent.

Cost of collaboration and contract manufacturing for the six months ended June 30, 2023 also increased due to the recognition of costs in connection with manufacturing commercial supplies for Sanofi related to Praluent outside the United States.

Other Operating (Income) Expense

Other operating (income) expense, net, for the three months ended March 31, 2022 included recognition of amounts previously deferred in connection with up-front and development milestone payments, as applicable, received in connection with our Sanofi IO, Teva, and MTPC collaborative arrangements.

Other operating (income) expense, net, for the three and six months ended June 30, 2022 included recognition of amounts previously deferred in connection with up-front and development milestone payments, as applicable, received in connection with our Sanofi IO, Teva, and Mitsubishi Tanabe Pharma Corporation ("MTPC") collaborative arrangements.

As the A&R IO LCA became effective July 1, 2022, the three months ended June 30, 2022 was the last period in which such amounts were recognized in connection with our Sanofi IO Collaboration.

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Three Months Ended

June 30, Six Months Ended

(In millions) 2023 2022 2023 2022

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Other (2.1) 1.9 (3.3) 10.8

Other (expense) income, net (70.7) (183.8)

Other income (expense), net 85.3 (133.6) 14.6 (317.4)

Interest expense (18.9) (13.1) (36.9) (26.7)

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Three Months Ended

June 30, Six Months Ended

(In millions, except effective tax rate) 2023 2022 2023 2022

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Effective tax rate

The Company's effective tax rate for the three months ended March 31, 2023 was positively impacted, compared to the U.S.

federal statutory rate, primarily by stock-based compensation and income earned in foreign jurisdictions with tax rates lower than the U.S.

federal statutory rate.

The effective tax rate for the three months ended March 31, 2023 was positively impacted, compared to the same period in 2022, primarily by stock-based compensation.

10.6 % 11.5 % 8.0 % 9.8 %

The Company's effective tax rate for the three and six months ended June 30, 2023 was positively impacted, compared to the U.S.

federal statutory rate, primarily by income earned in foreign jurisdictions with tax rates lower than the U.S.

federal statutory rate and, to a lesser extent, stock-based compensation and federal tax credits for research activities.

Liquidity and Capital Resources

Our financial condition is summarized as follows:

March 31, December 31,

June 30, December 31,

(In millions) 2023 2022 $ Change

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Finance lease liabilities $ 720.0 $ 720.0 $ —

As of March 31, 2023, we also had borrowing availability of $750.0 million under a revolving credit facility.

Sources and Uses of Cash for the Three Months Ended March 31, 2023 and 2022

Three Months Ended

As of June 30, 2023, we also had borrowing availability of $750.0 million under a revolving credit facility.

Sources and Uses of Cash for the Six Months Ended June 30, 2023 and 2022

Six Months Ended

(In millions) 2023 2022 $ Change

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Cash flows used in investing activities $ (2,622.6) $ (2,119.2) $ (503.4)

Cash flows (used in) provided by financing activities $ (322.5) $ 64.7 $ (387.2)

Cash flows used in financing activities $ (936.7) $ (36.4) $ (900.3)

Cash Flows from Investing Activities

Capital expenditures during the three months ended March 31, 2023 included costs incurred in connection with the expansion of our Tarrytown, New York campus, as well costs associated with the expansion of our manufacturing facilities in Rensselaer, New York (including the ongoing construction of a fill/finish facility and related equipment).

Capital expenditures during the six months ended June 30, 2023 included costs incurred in connection with the expansion of our Tarrytown, New York campus, as well costs associated with the expansion of our manufacturing facilities in Rensselaer, New York (including the ongoing construction of a fill/finish facility and related equipment).

Additionally, capital expenditures for the six months ended June 30, 2023 is net of grant proceeds of $60.0 million primarily related to the expansion of our facilities in New York.

We expect to incur capital expenditures of $760 million to $830 million for the full year of 2023 primarily in connection with the continued expansion of our research, preclinical manufacturing, and support facilities at our Tarrytown campus and our Rensselaer manufacturing facility (including the fill/finish facility).

Payments for Libtayo intangible asset of $100.9 million during the three months ended March 31, 2023 were related to contingent consideration in connection with our acquisition of the exclusive right to develop, commercialize, and manufacture Libtayo worldwide (as described in "Collaboration, License, and Other Agreements - Sanofi - Immuno-Oncology " above).

Payments for Libtayo intangible asset of $121.8 million during the six months ended June 30, 2023 were related to contingent consideration in connection with our acquisition of the exclusive right to develop, commercialize, and manufacture Libtayo worldwide (as described in "Collaboration, License, and Other Agreements - Sanofi - Immuno-Oncology " above).

Asset acquisition, net of cash acquired, of $230.3 million during the six months ended June 30, 2022 was related to our acquisition of Checkmate.

Cash Flows from Financing Activities

Proceeds from issuances of Common Stock, in connection with exercises of employee stock options, were $485.2 million during the three months ended March 31, 2023, compared to $521.6 million during the three months ended March 31, 2022.

Proceeds from issuances of Common Stock, in connection with exercises of employee stock options, were $575.9 million during the six months ended June 30, 2023, compared to $828.4 million during the six months ended June 30, 2022.

For information related to repurchases of Common Stock, see " Share Repurchase Programs " section below.

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

The share repurchase program permits the Company to make repurchases through a variety of methods, including open-market transactions (including pursuant to a trading plan adopted in accordance with Rule 10b5-1 of the Exchange Act), privately negotiated transactions, accelerated share repurchases, block trades, and other transactions in

compliance with Rule 10b-18 of the Exchange Act.

Share repurchases may be made from time to time at management's discretion, and the timing and amount of any such repurchases will be determined based on share price, market conditions, legal requirements, and other relevant factors.

As of June 30, 2023, the Company had repurchased the entire $3.0 billion of its Common Stock it was authorized to repurchase under the program.

In January 2023, our board of directors authorized an additional share repurchase program to repurchase up to $3.0 billion of our Common Stock.

Repurchases may be made from time to time at management's discretion, and the timing and amount of any such repurchases will be determined based on share price, market conditions, legal requirements, and other relevant factors.

The program has no time limit and can be discontinued at any time.

There can be no assurance as to the timing or number of shares of any repurchases in the future.

In January 2023, our board of directors authorized an additional share repurchase program to repurchase up to an additional $3.0 billion of our Common Stock.

The share repurchase program was approved under terms substantially similar to the share repurchase program above.

As of March 31, 2023, an aggregate of $3.051 billion remained available for share repurchases under the programs.

As of June 30, 2023, $2.332 billion remained available for share repurchases under the program.

The table below summarizes the shares of our Common Stock we repurchased and the cost of the shares, which were recorded as Treasury Stock.

Three Months Ended

Six Months Ended

(In millions) 2023 2022

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"Management's Discussion and Analysis of Financial Condition and Results of Operations" of our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 (filed February 6, 2023).

There have been no material changes to critical accounting estimates during the three months ended March 31, 2023.

There have been no material changes to critical accounting estimates during the six months ended June 30, 2023.

Future Impact of Recently Issued Accounting Standards

As of March 31, 2023, the future adoption of recently issued accounting standards is not expected to have a material impact on the Company's financial position or results of operations.

As of June 30, 2023, the future adoption of recently issued accounting standards is not expected to have a material impact on the Company's financial position or results of operations.

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 2. Management’s Discussion and Analysis