What changed in this filing

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Item 1. Financial Statements

2023-11-02 compared with 2023-08-03 · 234 added, 108 removed, 610 unchanged (36% of the section changed)

3 unchanged sentences

(In millions, except per share data)

June 30, December 31,

September 30, December 31,

Current assets:

45 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2023 2022 2023 2022

26 unchanged sentences

Other comprehensive income (loss), net of tax:

Unrealized (loss) gain on debt securities ( 15.7 ) ( 53.7 ) 41.5 ( 198.6 )

Unrealized gain (loss) on debt securities

21.3 ( 51.3 ) 62.8 ( 249.9 )

Loss on foreign currency translation ( 0.4 ) — ( 0.8 ) —

33 unchanged sentences

Balance, June 30, 2023 1.8 — 131.6 0.1 10,888.5 25,092.9 ( 197.7 ) ( 24.5 ) ( 11,765.9 ) 24,017.9

Issuance of Common Stock for equity awards granted under long-term incentive plans

— — 0.7 — 268.9 — — — — 268.9

Common Stock tendered upon exercise of stock options and vesting of restricted stock for employee tax obligations

— — ( 0.2 ) — ( 129.4 ) — — — — ( 129.4 )

Issuance/distribution of Common Stock for 401(k) Savings Plan

— — — — 16.1 — — — 1.9 18.0

Repurchases of Common Stock

— — — — — — — ( 0.6 ) ( 507.1 ) ( 507.1 )

Stock-based compensation charges — — — — 207.4 — — — — 207.4

Net income — — — — — 1,007.8 — — — 1,007.8

Other comprehensive income, net of tax

— — — — — — 20.9 — — 20.9

Balance, September 30, 2023 1.8 $ — 132.1 $ 0.1 $ 11,251.5 $ 26,100.7 $ ( 176.8 ) ( 25.1 ) $ ( 12,271.1 ) $ 24,904.4

CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (Unaudited) (continued)

23 unchanged sentences

Balance, June 30, 2022 1.8 — 128.3 0.1 9,120.2 20,793.9 ( 223.8 ) ( 20.6 ) ( 9,002.6 ) 20,687.8

Issuance of Common Stock for equity awards granted under long-term incentive plans

— — 0.9 — 322.9 — — — — 322.9

Common Stock tendered upon exercise of stock options and vesting of restricted stock for employee tax obligations

— — ( 0.2 ) — ( 108.9 ) — — — — ( 108.9 )

Issuance/distribution of Common Stock for 401(k) Savings Plan

— — — — 12.9 — — — 1.6 14.5

Repurchases of Common Stock

— — — — — — — ( 1.4 ) ( 913.0 ) ( 913.0 )

Stock-based compensation charges — — — — 171.1 — — — — 171.1

Net income — — — — — 1,315.7 — — — 1,315.7

Other comprehensive loss, net of tax — — — — — — ( 51.3 ) — — ( 51.3 )

Balance, September 30, 2022 1.8 $ — 129.0 $ 0.1 $ 9,518.2 $ 22,109.6 $ ( 275.1 ) ( 22.0 ) $ ( 9,914.0 ) $ 21,438.8

The accompanying notes are an integral part of the financial statements.

2 unchanged sentences

(In millions)

Six Months Ended

Nine Months Ended

September 30,

Cash flows from operating activities:

8 unchanged sentences

Changes in assets and liabilities:

Decrease in accounts receivable 207.4 875.1

(Increase) decrease in accounts receivable

( 256.1 ) 488.2

Increase in inventories ( 224.4 ) ( 552.2 )

9 unchanged sentences

Payments for Libtayo intangible asset ( 145.7 ) ( 926.8 )

Asset acquisition, net of cash acquired — ( 230.3 )

Acquisitions, net of cash acquired

( 51.1 ) ( 230.3 )

Net cash used in investing activities ( 3,118.9 ) ( 1,926.9 )

24 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(In millions) 2023 2022 2023 2022

5 unchanged sentences

19.1 13.6 53.3 33.2

3.3 3.0 7.7 3.0

$ 1,786.1 $ 1,801.4 $ 5,226.2 $ 5,194.4

(a) Prior to July 1, 2022, Regeneron recorded net product sales of Libtayo in the United States and Sanofi recorded net product sales of Libtayo outside the United States.

2 unchanged sentences

(b) Rest of world ("ROW")

As of June 30, 2023 and December 31, 2022, the Company had $ 3.718 billion and $ 3.586 billion, respectively, of trade accounts receivable that were recorded within Accounts receivable, net.

The Company had product sales to certain customers that accounted for more than 10% of total gross product revenue for the three and six months ended June 30, 2023 and 2022.

As of September 30, 2023 and December 31, 2022, the Company had $ 3.792 billion and $ 3.586 billion, respectively, of trade accounts receivable that were recorded within Accounts receivable, net.

The Company had product sales to certain customers that accounted for more than 10% of total gross product revenue for the three and nine months ended September 30, 2023 and 2022.

Sales to each of these customers as a percentage of the Company's total gross product revenue are as follows:

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

2023 2022 2023 2022

Besse Medical, a subsidiary of AmerisourceBergen Corporation

Besse Medical, a subsidiary of Cencora, Inc.

53 % 56 % 52 % 56 %

3 unchanged sentences

Statement of Operations Classification Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(In millions) 2023 2022 2023 2022

15 unchanged sentences

Amounts recognized in connection with up-front payments received Other operating income $ — $ — $ — $ 35.1

* Net of one-time payment of $ 56.9 million to Sanofi in connection with the amendment to the Antibody License and Collaboration Agreement described below

(a) As described within the " Immuno-Oncology " section below, effective July 1, 2022, the Company obtained the exclusive right to develop, commercialize, and manufacture Libtayo worldwide.

7 unchanged sentences

Sanofi leads commercialization activities for products under the Antibody Collaboration, subject to the Company's right to co-commercialize such products.

In addition to profit and loss sharing, the Company is entitled to receive sales milestone payments from Sanofi.

In addition to profit and loss sharing, the Company was entitled to receive sales milestone payments from Sanofi.

During the three months ended September 30, 2023, the Company earned the final $ 50.0 million sales-based milestone from Sanofi, upon aggregate annual sales of antibodies outside the United States (including Praluent) exceeding $ 3.0 billion on a rolling twelve-month basis.

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.

The Company is entitled to receive the final sales milestone payment of $ 50.0 million when such sales outside the United States exceed $ 3.0 billion on a rolling twelve-month basis.

The following table summarizes contract balances in connection with the Company's Antibody Collaboration with Sanofi:

June 30, December 31,

September 30, December 31,

(In millions) 2023 2022

10 unchanged sentences

In connection with the A&R IO LCA, in 2022, the Company made a $ 900.0 million up-front payment to Sanofi, as well as a $ 100.0 million regulatory milestone payment.

In addition, Sanofi earned a $ 65.0 million sales-based milestone upon the achievement of a specified amount of worldwide net product sales of Libtayo in 2022 and is eligible to receive an additional $ 35.0 million sales-based milestone upon the achievement of a specified amount of worldwide net product sales of Libtayo in 2023 (aggregate of $ 100.0 million in sales-based milestones eligible to be earned under the terms of the A&R IO LCA).

In addition, Sanofi was eligible to earn an aggregate of $ 100.0 million in Libtayo sales-based milestones under the terms of the A&R IO LCA, of which they earned $ 65.0 million in 2022 and $ 35.0 million in 2023.

The Company also pays Sanofi an 11 % royalty on net product sales of Libtayo through March 31, 2034.

5 unchanged sentences

Statement of Operations Classification Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(In millions) 2023 2022 2023 2022

6 unchanged sentences

The following table summarizes contract balances in connection with the Company's Bayer collaboration:

June 30, December 31,

September 30, December 31,

(In millions) 2023 2022

7 unchanged sentences

Statement of Operations Classification Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(In millions) 2023 2022 2023 2022

1 unchanged sentence

Other Collaboration revenue $ ( 5.7 ) $ — $ ( 9.5 ) $ —

Reimbursement of research and development expenses from Roche was not material for the three and six months ended June 30, 2023 and 2022.

Reimbursement of research and development expenses from Roche was not material for the three and nine months ended September 30, 2023 and 2022.

The following table summarizes contract balances in connection with the Company's Roche collaboration:

June 30, December 31,

September 30, December 31,

(In millions) 2023 2022

Accounts receivable, net $ — $ 396.6

In 2019, the Company and Alnylam entered into a global, strategic collaboration to discover, develop, and commercialize RNA interference ("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, the Company and Alnylam Pharmaceuticals, Inc.

entered into a global, strategic collaboration to discover, develop, and commercialize RNA interference ("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 connection with entering into 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.

For each program, the Company provides Alnylam with a specified amount of funding at program initiation and at lead candidate designation, and Alnylam is eligible to receive two $ 100.0 million clinical proof-of-principle milestones for each of the eye and CNS programs (an aggregate of $ 200.0 million in development milestones).

Under the terms of the collaboration, the parties plan to perform discovery research until designation of lead candidates.

For each program, the Company provides Alnylam with a specified amount of funding at program initiation and at lead candidate designation.

Under the terms of the collaboration, the parties perform discovery research until designation of lead candidates.

Following designation of a lead candidate, the parties may further advance such lead candidate under either a co-development/co-commercialization collaboration agreement ("Co-Co Collaboration Agreement") (under which the parties are advancing ALN-APP and ALN-PNP, which are currently in clinical development) or license agreement.

Amounts recognized in the Company's Statements of Operations in connection with its Alnylam collaboration were not material for the three and six months ended June 30, 2023 and 2022.

In addition, contract balances in the Company's Balance Sheets were not material as of June 30, 2023 and December 31, 2022.

Sonoma Biotherapeutics, Inc.

During the three months ended September 30, 2023, the Company became obligated to pay Alnylam a $ 100.0 million development milestone, which was recorded to Acquired in-process research and development expense, upon the achievement of specified proof-of-principle criteria for the ALN-APP program.

Alnylam is eligible to receive an additional $ 100.0 million clinical proof-of-principle milestone in connection with an eye program.

Amounts recognized in the Company's Statements of Operations in connection with its Alnylam collaboration are as follows:

Statement of Operations Classification Three Months Ended

September 30, Nine Months Ended

September 30,

(In millions) 2023 2022 2023 2022

Regeneron's obligation for its share of Alnylam R&D expenses, net of reimbursement of R&D expenses

(R&D expense)

$ ( 13.5 ) $ ( 10.6 ) $ ( 52.1 ) $ ( 36.1 )

Development milestone

Acquired in-process research and development $ ( 100.0 ) $ — $ ( 100.0 ) $ —

The following table summarizes contract balances in connection with the Company's Alnylam collaboration:

September 30, December 31,

(In millions) 2023 2022

Accrued expenses and other current liabilities

$ 111.5 $ 7.4

In March 2023, the Company and Sonoma Biotherapeutics, Inc.

4 unchanged sentences

The Company will have the option to lead late-stage development and commercialization on all products globally, with Sonoma retaining rights to co-promote all such products in the United States.

Biomedical Advanced Research and Development Authority ("BARDA")

In August 2023, the Company expanded its Other Transaction Agreement ("OTA") with BARDA, pursuant to which the U.S.

Department of Health and Human Services ("HHS") is obligated to fund up to 70 % of the Company's costs incurred for certain development activities related to a next-generation COVID-19 monoclonal antibody therapy for the prevention of SARS-CoV-2 infection.

The agreement could result in payments to the Company of up to approximately $ 326 million in the aggregate to support clinical development, clinical manufacturing, and the regulatory licensure process.

Amounts recognized within Other revenue in the Company's Statements of Operations in connection with this BARDA agreement were $ 34.2 million for the three months ended September 30, 2023.

The following table summarizes the Company's contract balances in connection with this BARDA agreement:

September 30,

(In millions) 2023

Accounts receivable, net

In 2017, the Company entered into an agreement with Decibel Therapeutics, Inc.

to discover and develop new potential therapeutics to protect, repair and restore hearing (including DB-OTO, which is currently in clinical development, and preclinical programs for GJB2-related and stereocilin-related hearing loss).

In connection with the agreement, the Company also purchased shares of Decibel stock.

In August 2023, the Company entered into an Agreement and Plan of Merger to acquire Decibel, and in September 2023, the Company completed its acquisition of Decibel.

The Company paid $ 101.3 million in cash (or $ 4.00 per share of Decibel common stock), of which $ 6.6 million was attributed to post-combination services to be rendered by Decibel equity award holders, and as a result, was excluded from the amount of consideration transferred for purchase accounting.

In addition, Decibel shareholders received one non-tradeable contingent value right ("CVR") per share of Decibel common stock, which entitles the holder to receive up to $ 3.50 per share in cash upon achievement of certain clinical development and regulatory milestones for DB-OTO within specified time periods.

At closing, the Company recorded a liability related to the fair value of the CVRs of $ 43.7 million (see Note 6).

The maximum aggregate amount that holders of the CVRs may be entitled to receive if all the milestones contemplated by the CVRs are achieved is approximately $ 97 million.

The fair value of the Company's investment in Decibel stock immediately before the acquisition date was $ 10.3 million.

The Decibel acquisition was accounted for as a business combination.

In a business combination, the acquisition method of accounting generally requires that the assets acquired and liabilities assumed be recorded as of the date of the acquisition at their respective fair values.

Amounts allocated to acquired in-process research and development are capitalized and accounted for as indefinite-lived intangible assets, subject to impairment testing until completion or abandonment of the associated research and development efforts.

Any excess of the purchase price (consideration transferred) over the fair values of net assets acquired is recorded as goodwill.

Transaction costs in connection with a business combination are expensed as incurred.

The following table summarizes the amounts recognized for assets acquired and liabilities assumed based on their estimated fair values as of the acquisition date:

September 25,

(In millions) 2023

Cash and cash equivalents $ 42.2

Marketable securities 12.1

Deferred tax assets, net

Indefinite-lived intangible asset related to in-process research and development 42.5

Other assets and liabilities, net

The final determination of fair values of assets acquired, liabilities assumed, and tax-related items will be completed no later than one year from the acquisition date.

In May 2022, the Company completed its acquisition of Checkmate Pharmaceuticals, Inc.

(“Checkmate”) for a total equity value of approximately $ 250 million.

As a result of the transaction, which was accounted for as an asset acquisition, the Company recorded (i) a charge of $ 195.0 million to Acquired in-process research and development and (ii) net assets of $ 35.3 million, net of cash, related to the assets acquired (including deferred tax assets and investments) and liabilities assumed.

for a total equity value of approximately $ 250 million.

As a result of the transaction, which was accounted for as an asset acquisition, the Company recorded, during the three months ended June 30, 2022, (i) a charge of $ 195.0 million to Acquired in-process research and development and (ii) net assets of $ 61.7 million, including $ 26.4 million of cash and cash equivalents acquired, related to the assets acquired (including deferred tax assets and investments) and liabilities assumed.

Net Income Per Share

4 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

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

9 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(Shares in millions) 2023 2022 2023 2022

1 unchanged sentence

Marketable Securities

Marketable securities as of June 30, 2023 and December 31, 2022 consist of both available-for-sale debt securities of investment grade issuers (see below and Note 6) as well as equity securities of publicly traded companies (see Note 6).

Marketable securities as of September 30, 2023 and December 31, 2022 consist of both available-for-sale debt securities of investment grade issuers (see below and Note 6) as well as equity securities of publicly traded companies (see Note 6).

The following tables summarize the Company's investments in available-for-sale debt securities:

(In millions) Amortized Unrealized Fair

As of June 30, 2023

As of September 30, 2023

Cost Basis Gains Losses Value

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The Company classifies its investments in available-for-sale debt securities based on their contractual maturity dates.

The available-for-sale debt securities as of June 30, 2023 mature at various dates through April 2029.

The available-for-sale debt securities as of September 30, 2023 mature at various dates through April 2029.

The fair values of available-for-sale debt securities by contractual maturity consist of the following:

June 30, December 31,

September 30, December 31,

(In millions) 2023 2022

6 unchanged sentences

(In millions)

As of June 30, 2023

As of September 30, 2023

Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss

13 unchanged sentences

$ 3,300.9 $ ( 76.9 ) $ 4,332.2 $ ( 225.9 ) $ 7,633.1 $ ( 302.8 )

The unrealized losses on corporate bonds as of June 30, 2023 were primarily driven by increases in interest rates.

The unrealized losses on corporate bonds as of September 30, 2023 were primarily driven by increases in interest rates.

The Company has reviewed its portfolio of available-for-sale debt securities and determined that the decline in fair value below cost did not result from credit-related factors.

In addition, the Company does not intend to sell, and it is not more likely than not that the Company will be required to sell, such securities before recovery of their amortized cost bases.

With respect to marketable securities, for the three and six months ended June 30, 2023 and 2022, amounts reclassified from Accumulated other comprehensive loss into Other income (expense), net were related to realized gains/losses on sales of available-for-sale debt securities.

For the three months ended ended June 30, 2023, realized gains on sales of marketable securities were not material and there were no realized losses.

For the six months ended June 30, 2023, and for the three and six months ended June 30, 2022, realized gains and losses on sales of marketable securities were not material.

With respect to marketable securities, for the three and nine months ended September 30, 2023 and 2022, amounts reclassified from Accumulated other comprehensive loss into Other income (expense), net were related to realized gains/losses on sales of available-for-sale debt securities.

For the three months ended September 30, 2023, realized gains on sales of marketable securities were not material and there were no realized losses.

For the nine months ended September 30, 2023, and for the three and nine months ended September 30, 2022, realized gains and losses on sales of marketable securities were not material.

Fair Value Measurements

The table below summarizes the Company's assets which are measured at fair value on a recurring basis.

The following fair value hierarchy is used to classify assets, based on inputs to valuation techniques utilized to measure fair value:

• Level 1 - Quoted prices in active markets for identical assets

The table below summarizes the Company's assets and liabilities which are measured at fair value on a recurring basis.

The following fair value hierarchy is used to classify assets and liabilities, based on inputs to valuation techniques utilized to measure fair value:

• Level 1 - Quoted prices in active markets for identical assets or liabilities

• Level 2 - Significant other observable inputs, such as quoted market prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, or model-based valuations in which significant inputs used are observable

1 unchanged sentence

(In millions) Fair Value Measurements at Reporting Date

As of June 30, 2023

Fair Value Level 1 Level 2

As of September 30, 2023

Fair Value Level 1 Level 2 Level 3

Cash equivalents $ 1,018.5 $ 119.9 $ 898.6 $ —

9 unchanged sentences

$ 14,558.3 $ 1,039.3 $ 13,519.0 $ —

Contingent consideration - CVRs

$ 43.7 $ — $ — $ 43.7

As of December 31, 2022

10 unchanged sentences

$ 12,891.0 $ 1,298.3 $ 11,592.7 $ —

The Company held certain restricted equity securities as of June 30, 2023 which are subject to transfer restrictions that expire at various dates through 2024.

During the three and six months ended June 30, 2023, we recorded $ 30.9 million and $ 195.6 million of net unrealized losses, respectively, on equity securities in Other income (expense), net;

and during the three and six months ended June 30, 2022, we recorded $ 163.7 million and $ 374.9 million of net unrealized losses, respectively, on equity securities in Other income (expense), net.

In addition to the investments summarized in the table above, as of June 30, 2023 and December 31, 2022, the Company had $ 78.3 million and $ 48.3 million, respectively, in equity investments that do not have a readily determinable fair value.

The Company held certain restricted equity securities as of September 30, 2023 which are subject to transfer restrictions that expire at various dates through 2024.

During the three and nine months ended September 30, 2023, the Company recorded $ 100.3 million and $ 295.9 million of net unrealized losses, respectively, on equity securities in Other income (expense), net.

In addition, during the three months ended September 30, 2023, the Company recorded a write-down of $ 29.0 million in Other income (expense), net related to the

Company's investments in private companies.

During the three and nine months ended September 30, 2022, the Company recorded $ 254.3 million of net unrealized gains and $ 120.6 million of net unrealized losses, respectively, on equity securities in Other income (expense), net.

In addition to the investments summarized in the table above, as of September 30, 2023 and December 31, 2022, the Company had $ 60.8 million and $ 48.3 million, respectively, in equity investments that do not have a readily determinable fair value.

These investments are recorded within Other noncurrent assets.

The fair value of our long-term debt, which was determined based on Level 2 inputs, was estimated to be $ 1.476 billion and $ 1.443 billion as of June 30, 2023 and December 31, 2022, respectively.

As described in Note 3, in September 2023, the Company acquired Decibel and recorded a liability for the CVRs within other liabilities.

The fair value of the CVR liability is determined based on the probability of achieving certain clinical development and regulatory milestones and estimated discount rates.

The fair value of the CVR liability is remeasured each reporting period until the contingencies are resolved, with any changes in fair value recorded in Other operating (income) expense, net.

The fair value of the Company's long-term debt, which was determined based on Level 2 inputs, was estimated to be $ 1.395 billion and $ 1.443 billion as of September 30, 2023 and December 31, 2022, respectively.

Inventories consist of the following:

June 30, December 31,

September 30, December 31,

(In millions) 2023 2022

4 unchanged sentences

$ 2,562.0 $ 2,401.9

Inventory balances in the table above are net of reserves of $ 747.9 million and $ 720.7 million as of June 30, 2023 and December 31, 2022, respectively.

Inventory balances in the table above are net of reserves of $ 726.2 million and $ 720.7 million as of September 30, 2023 and December 31, 2022, respectively.

Deferred costs represent the costs of product manufactured and shipped to the Company's collaborators for which recognition of revenue has been deferred.

1 unchanged sentence

federal, state, and foreign income taxes.

The Company's effective tax rate was 10.6 % and 11.5 % for the three months ended June 30, 2023 and 2022, respectively, and 8.0 % and 9.8 % for the six months ended June 30, 2023 and 2022, respectively.

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

The Company's effective tax rate was 9.3 % and 12.9 % for the three months ended September 30, 2023 and 2022, respectively, and 8.4 % and 11.1 % for the nine months ended September 30, 2023 and 2022, respectively.

The Company's effective tax rate for the three and nine months ended September 30, 2023 and September 30, 2022 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.

The Company's effective tax rate for the three and six months ended June 30, 2022 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.

In August 2022, the Inflation Reduction Act of 2022 ("IRA") was signed into law in the United States.

1 unchanged sentence

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

The IRA did not have a material impact on the Company's financial statements for the three and six months ended June 30, 2023.

The IRA did not have a material impact on the Company's financial statements for the three and nine months ended September 30, 2023.

Stockholders' Equity

Share Repurchase Programs

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

5 unchanged sentences

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

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

As of September 30, 2023, $ 1.826 billion remained available for share repurchases under the January 2023 program.

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

As described in Note 8, effective January 1, 2023 share repurchases, net of issuances, are subject to a 1% excise tax;

1 unchanged sentence

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(In millions) 2023 2022 2023 2022

3 unchanged sentences

The following provides a reconciliation of cash, cash equivalents, and restricted cash reported within the Condensed Consolidated Balance Sheet to the total of the same such amounts shown in the Condensed Consolidated Statement of Cash Flows:

September 30,

(In millions) 2023 2022

Cash and cash equivalents $ 2,152.3 $ 3,491.3

Restricted cash included in Prepaid expenses and other current assets 5.5 —

Restricted cash included in Other noncurrent assets

3 unchanged sentences

Supplemental disclosure of non-cash investing and financing activities

June 30, December 31, June 30, December 31,

September 30, December 31, September 30, December 31,

(In millions) 2023 2022 2022 2021

1 unchanged sentence

Accrued contingent consideration for Libtayo intangible asset $ 62.8 $ 135.5 $ 116.0 $ —

Accrued contingent consideration in connection with acquisitions

$ 43.7 $ — $ — $ —

Legal Matters

4 unchanged sentences

The Company recognizes accruals for loss contingencies associated with such proceedings when it is probable that a liability will be incurred and the amount of loss can be reasonably estimated.

As of June 30, 2023 and December 31, 2022, the Company's accruals for loss contingencies were not material.

As of September 30, 2023 and December 31, 2022, the Company's accruals for loss contingencies were not material.

There are certain loss contingencies that the Company deems reasonably possible for which the possible loss or range of possible loss is not estimable at this time.

6 unchanged sentences

In the United States, Amgen asserted claims of U.S.

8,829,165 (the "'165 Patent") and 8,859,741 (the "'741 Patent"), and sought a permanent injunction to prevent the Company and the Sanofi defendants from commercial manufacturing, using, offering to sell, or selling within the United States (as well as importing into the United States) (collectively, "Commercializing") Praluent.

Amgen also sought a judgment of patent infringement of the asserted patents,

monetary damages (together with interest), costs and expenses of the lawsuits, and attorneys' fees.

(collectively, "Commercializing") Praluent.

Amgen also sought a judgment of patent infringement of the asserted patents, monetary damages (together with interest), costs and expenses of the lawsuits, and attorneys' fees.

As previously reported, on February 11, 2021, the United States Court of Appeals for the Federal Circuit (the "Federal Circuit") affirmed the lower court's decision that certain of Amgen's asserted patent claims are invalid based on lack of enablement.

10 unchanged sentences

and on March 21, 2023, the court denied Amgen's motion to dismiss.

On August 28, 2023, the Company filed an amended complaint in this matter;

and, as part of its response, on September 20, 2023, Amgen filed a counterclaim alleging that the Company engaged in unfair business practices in violation of state law.

A trial has been scheduled to begin in November 2024.

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United States

On February 11, 2020, anonymous parties filed two requests for ex parte reexamination of the Company's U.S.

10,406,226 (the "'226 Patent") and 10,464,992 (the "'992 Patent"), and the USPTO has granted both requests.

On May 5, 2021, Mylan Pharmaceuticals Inc.

filed inter partes review ("IPR") petitions in the USPTO against the Company's U.S.

9,254,338 (the "'338 Patent") and 9,669,069 (the "'069 Patent") seeking declarations of invalidity of the '338 Patent and the '069 Patent.

On November 10, 2021, the USPTO issued a decision instituting both IPR proceedings.

On December 9, 2021, Apotex Inc.

and Celltrion, Inc.

each filed two separate IPR petitions against the Company's '338 and '069 Patents requesting that their IPRs be instituted and joined with the IPR proceedings initiated by Mylan concerning the '338 and '069 Patents, which petitions were granted on February 9, 2022.

An oral hearing was held on August 10, 2022.

On November 9, 2022, the USPTO issued final written decisions finding that the claims of the '338 and '069 Patents are unpatentable and,

therefore, invalid.

Post-Grant Proceedings Before USPTO

Company Patent(s)

Challenger(s)

Type of Challenge

Date of Challenge

Latest Events/Current Status

10,406,226 (the "'226 Patent") and 10,464,992 (the "'992 Patent") Anonymous parties Ex parte reexamination

February 11, 2020 On September 11, 2023, the USPTO dismissed the '226 Patent reexamination proceedings following the Company’s filing of a Notice of Disclaimer, disclaiming all claims of the '226 Patent.

On September 8, 2023, the '992 Patent reexamination proceedings were stayed by the USPTO pending resolution of the inter partes review ("IPR") of the '992 Patent initiated by Celltrion, Inc., as discussed further below.

9,254,338 (the "'338 Patent") and 9,669,069 (the "'069 Patent") Mylan Pharmaceuticals Inc., Apotex Inc., and Celltrion, Inc.

IPR petitions seeking declarations of invalidity May 5, 2021 On November 9, 2022, the USPTO issued final written decisions finding that the claims of the '338 and '069 Patents are unpatentable and, therefore, invalid.

On January 10, 2023, the Company filed notices of appeal of the USPTO written decisions concerning the '338 and '069 Patents with the Federal Circuit.

In 2022, Mylan filed IPR petitions against the Company's U.S.

10,130,681 (the "'681 Patent") and 10,888,601 (the "'601 Patent") (each filed July 1, 2022) and 10,857,205 (the "'205 Patent") (filed October 28, 2022) seeking declarations of invalidity of each of these patents.

On January 11, 2023, the USPTO instituted IPR proceedings concerning the '681 Patent and the '601 Patent.

On February 21, 2023, the Company filed a Notice of Disclaimer with the USPTO, disclaiming all claims of the '205 Patent;

and, as a result, on March 1, 2023, the USPTO denied institution of Mylan's IPR petition against the '205 Patent.

On January 6, 2023 and March 26, 2023, Samsung Bioepis Co., Ltd.

filed separate IPR petitions against the Company's '681 Patent and '601 Patent, respectively, seeking declarations of invalidity of such patents.

On July 19, 2023, the USPTO instituted an IPR proceeding concerning the '681 Patent.

On September 9, 2022, Apotex filed an IPR petition against the Company's U.S.

11,253,572 (the "'572 Patent") seeking a declaration of invalidity of the '572 Patent.

On March 10, 2023, the USPTO declined to institute an IPR proceeding concerning the '572 Patent.

On April 27, 2023, Samsung Bioepis Co., Ltd.

filed a separate IPR petition against the '572 Patent seeking a declaration of invalidity of the '572 Patent.

On January 17, 2023 and February 28, 2023, Celltrion filed IPR petitions against the '992 Patent and the '226 Patent, respectively, seeking declarations of invalidity of such patents.

10,130,681 (the "'681 Patent"), 10,888,601 (the "'601 Patent"), and 10,857,205 (the "'205 Patent") Mylan IPR petitions seeking declarations of invalidity July 1, 2022 ('681 Patent and '601 Patent)

October 28, 2022 ('205 Patent)

IPR proceedings concerning the '681 Patent and the '601 Patent instituted on January 11, 2023;

oral hearing held on October 25, 2023.

On March 1, 2023, the USPTO denied institution of Mylan's IPR petition against the '205 Patent following the Company's filing of a Notice of Disclaimer with the USPTO, disclaiming all claims of the '205 Patent.

'681 Patent and '601 Patent

Samsung Bioepis Co., Ltd.

IPR petitions seeking declarations of invalidity January 6, 2023 ('681 Patent)

March 26, 2023 ('601 Patent)

On July 19, 2023 and October 20, 2023, the USPTO instituted IPR proceedings concerning the '681 Patent and the '601 Patent, respectively.

11,253,572 (the "'572 Patent") Apotex

IPR petitions seeking declaration of invalidity

September 9, 2022

On March 10, 2023, the USPTO declined to institute an IPR proceeding.

Samsung Bioepis Co., Ltd.

IPR petition seeking declaration of invalidity

April 27, 2023

Decision whether to institute pending.

'992 Patent and '226 Patent

Celltrion IPR petitions seeking declarations of invalidity

January 17, 2023 ('992 Patent)

February 28, 2023 ('226 Patent)

On July 20, 2023, the USPTO instituted an IPR proceeding concerning the '992 Patent.

On September 1, 2023, the USPTO denied institution of Celltrion's IPR petition against the '226 Patent following the Company’s filing of a Notice of Disclaimer with the USPTO, disclaiming all claims of the '226 Patent.

Patent Litigation

On August 2, 2022, the Company filed a patent infringement lawsuit against Mylan in the United States District Court for the Northern District of West Virginia alleging that Mylan's filing for a U.S.

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A trial was held from June 12, 2023 through June 23, 2023 concerning certain claims of the '601 Patent, the '572 Patent, and the Company's U.S.

Closing arguments have been scheduled for August 3, 2023.

On October 26 and October 27, 2021, anonymous parties initiated opposition proceedings in the EPO against the Company's European Patent No.

2,944,306 (the "'306 Patent") seeking revocation of the '306 Patent in its entirety.

Between May 5-10, 2023, Amgen and three anonymous parties initiated opposition proceedings in the EPO against the Company's European Patent No.

3,716,992 (the "EP '992 Patent") seeking revocation of the EP '992 Patent in its entirety.

On June 22, 2023, Samsung Bioepis NL B.V.

initiated invalidation proceedings in the German Federal Patent Court against the German designation of the Company's European Patent No.

2,364,691 (the "'691 Patent") seeking revocation of the '691 Patent in its entirety.

Closing arguments were presented on August 3, 2023.

Post-Grant Proceedings

Authority/Court

Company Patent(s)

Challenger(s)

Type of Challenge

Date of Challenge

Latest Events/Current Status

European Patent No.

2,944,306 (the "'306 Patent") Anonymous parties Opposition proceedings October 26 and October 27, 2021 Oral hearing to be scheduled.

European Patent No.

3,716,992 (the "EP '992 Patent") Amgen and three anonymous parties Opposition proceedings May 5-10, 2023 Oral hearing to be scheduled.

German Federal Patent Court

German designation of European Patent No.

2,364,691 (the "'691 Patent") Samsung Bioepis NL B.V.

Invalidation proceedings June 22, 2023 Oral hearing to be scheduled.

On June 15, July 15, August 30, and October 4, 2022, the Company and Bayer Inc.

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On March 23, 2023 and June 14, 2023, the Company and Bayer Inc.

filed patent infringement lawsuits against BCIL in the Federal Court of Canada seeking a declaration that the making, constructing, using, or selling of an aflibercept biosimilar would

directly or indirectly infringe one or more claims of the Company's '510 and '276 Patents.

filed patent infringement lawsuits against BCIL in the Federal Court of Canada seeking a declaration that the making, constructing, using, or selling of an aflibercept biosimilar would directly or indirectly infringe one or more claims of the Company's '510 and '276 Patents.

The June 14, 2023 lawsuit was filed after BCIL served Bayer Inc.

with a statutory notification in relation to the NDS on May 23, 2023.

On September 14, 2023, the Company, Bayer Inc., and Bayer Healthcare LLC filed patent infringement lawsuits against Viatris Canada and BCIL in the Federal Court of Canada seeking a declaration that the making, constructing, using, or selling of an aflibercept biosimilar would directly or indirectly infringe one or more claims of Bayer Healthcare LLC's Canadian Patent No.

2,970,315 (the "'315 Patent").

On May 9, 2023, Amgen Canada Inc.

("Amgen Canada") filed invalidation proceedings against the Company in the Federal Court of Canada seeking revocation of the '510 Patent and the '276 Patent.

On September 14, 2023, the Company, Bayer Inc., and Bayer Healthcare LLC filed patent infringement lawsuits against Amgen Canada in the Federal Court of Canada seeking a

declaration that the making, constructing, using, or selling of an aflibercept biosimilar would directly or indirectly infringe one or more claims of the '315 Patent.

On September 14, 2023, the Company and Bayer Inc.

filed three separate patent infringement lawsuits against Amgen Canada in the Federal Court of Canada seeking a declaration that the making, constructing, using, or selling of an aflibercept biosimilar would directly or indirectly infringe one or more claims of the Company's '193 Patent, '495 Patent, and '768 Patent, respectively.

On October 11, 2023, the Company, Bayer Inc., and Bayer Healthcare LLC filed two separate patent infringement lawsuits against Amgen Canada in the Federal Court of Canada seeking a declaration that the making, constructing, using, or selling of an aflibercept biosimilar would directly or indirectly infringe one or more claims of the Company's '510 Patent and '276 Patent, respectively.

On October 31, 2022 and December 13, 2022, Samsung Bioepis Co., Ltd.

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Court of Appeals for the Second Circuit.

An oral hearing before the U.S.

Court of Appeals for the Second Circuit was held on October 11, 2023.

Proceedings Relating to REGEN-COV (casirivimab and imdevimab)

On October 5, 2020, Allele Biotechnology and Pharmaceuticals, Inc.

("Allele") filed a lawsuit (as amended on April 8, 2021 and December 12, 2022) against the Company in the United States District Court for the Southern District of New York,

asserting infringement of U.S.

("Allele") filed a lawsuit (as amended on April 8, 2021 and December 12, 2022) against the Company in the United States District Court for the Southern District of New York, asserting infringement of U.S.

10,221,221 (the "'221 Patent").

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On July 16, 2021, the Company filed a motion to dismiss the complaint, which motion was denied on March 2, 2022.

On September 18, 2023, the parties entered into a stipulation that narrowed the case to (i) whether any safe harbor defense under federal law applies to Regeneron's use of the invention covered, based on the court's claim construction, by the '221 Patent;

(ii) damages for any use by Regeneron found to not be covered by such safe harbor defense;

and (iii) whether any use referred to in clause (ii) above was willful.

Department of Justice Matters

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An oral hearing on the parties' respective motions for summary judgment was held on July 21, 2023.

On September 27, 2023, the court (i) denied in part and granted in part the Company's motion for summary judgment and (ii) denied in its entirety the motion for partial summary judgment filed by the U.S.

Attorney's Office for the District of Massachusetts.

On October 25, 2023, the court certified for interlocutory appeal a portion of the court's September 27, 2023 order that addressed the causation standard applicable to the alleged violations of the federal Anti-Kickback Statute and federal False Claims Act.

In September 2019, the Company and Regeneron Healthcare Solutions, Inc., a wholly-owned subsidiary of the Company, each received a civil investigative demand ("CID") from the U.S.

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On July 25, 2023, the court in part granted and in part denied the Company's motion to dismiss.

On September 1, 2023, the Company filed a second motion to dismiss the amended complaint or, in the alternative, a motion for judgment on the pleadings.

A trial has been scheduled for April 2025.

In June 2021, the Company received a CID from the U.S.

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The MMO and Local 464A lawsuits are putative class action lawsuits.

On December 29, 2021, the lawsuits filed by UHC and Humana were stayed

by the United States District Court for the Southern District of New York pending resolution of the proceedings before the U.S.

On December 29, 2021, the lawsuits filed by UHC and Humana were stayed by the United States District Court for the Southern District of New York pending resolution of the proceedings before the U.S.

District Court for the District of Massachusetts discussed under "Department of Justice Matters" above.

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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 1. Financial Statements