REGENERON PHARMACEUTICALS, INC. 10-K

Item 9A. Controls and Procedures Evaluation of Disclosure Controls and Procedures Our management, with the participation of our principal executive officer and principal financial officer, conducted an evaluation of the effectiveness of our disclosure controls and procedures (as such term is defined in Rules 13a-15(e) or 15d-15(e) under the Securities Exchange Act of 1934, as amended (the "Exchange Act")), as of the end of the period covered by this Annual Report on Form 10-K. Based on this evaluation, our principal executive officer and principal financial officer each concluded that, as of the end of such period, our disclosure controls and procedures were effective in ensuring that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported on a timely basis, and is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosures. Management's Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) or 15d-15(f) under the Exchange Act. Our management conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 2023 using the framework in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on that evaluation, our management has concluded that our internal control over financial reporting was effective as of December 31, 2023. The effectiveness of the Company's internal control over financial reporting as of December 31, 2023 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which appears under Part IV, Item 15. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Changes in Internal Control over Financial Reporting There has been no change in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) or 15d-15(f) under the Exchange Act) during the quarter ended December 31, 2023 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting. 90 Table of Contents Inherent Limitations on Effectiveness of Controls Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or internal controls over financial reporting will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the system are met and cannot detect all deviations. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud or deviations, if any, within the company have been detected. Projections of any evaluation of effectiveness to future periods are subject to the risks that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Item 9B. Other Information As disclosed in the table below, during the three months ended December 31, 2023, certain of our directors and/or executive officers adopted plans for trading arrangements intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) of the Exchange Act. Name Position Date of Plan Adoption Scheduled End Date of Trading Arrangement (a) Total Number of Securities to Be Sold Under the Plan Robert E. Landry Executive Vice President, Finance and Chief Financial Officer 11/9/2023 5/6/2024 14,337 (a) The trading arrangement may expire on an earlier date if and when all transactions under the arrangement are completed. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. PART III Item 10. Directors, Executive Officers and Corporate Governance The information required by this item (other than the information set forth in the next paragraph in this Item 10) will be included in our definitive proxy statement with respect to our 2024 Annual Meeting of Shareholders to be filed with the SEC, and is incorporated herein by reference. We have adopted a code of business conduct and ethics that applies to our officers, directors, and employees. The full text of our code of business conduct and ethics can be found on our website (http://www.regeneron.com) under the "Governance" heading on the "Investors & Media" page. We may satisfy the disclosure requirements under Item 5.05 of Form 8-K regarding an amendment to, or a waiver from, a provision of our code of business conduct and ethics that applies to our principal executive officer, principal financial officer, principal accounting officer, or controller, or persons performing similar functions, by posting such information on our website where it is accessible through the same link noted above. Item 11. Executive Compensation The information called for by this item will be included in our definitive proxy statement with respect to our 2024 Annual Meeting of Shareholders to be filed with the SEC, and is incorporated herein by reference. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters The information called for by this item will be included in our definitive proxy statement with respect to our 2024 Annual Meeting of Shareholders to be filed with the SEC, and is incorporated herein by reference. Item 13. Certain Relationships and Related Transactions, and Director Independence The information called for by this item will be included in our definitive proxy statement with respect to our 2024 Annual Meeting of Shareholders to be filed with the SEC, and is incorporated herein by reference. Item 14. Principal Accountant Fees and Services The information called for by this item will be included in our definitive proxy statement with respect to our 2024 Annual Meeting of Shareholders to be filed with the SEC, and is incorporated herein by reference. 91 Table of Contents PART IV Item 15. Exhibits and Financial Statement Schedules (a) 1. Financial Statements The consolidated financial statements filed as part of this report are listed on the Index to Financial Statements on page F-1. 2. Financial Statement Schedules All schedules for which provision is made in the applicable accounting regulations of the SEC are not required under the related instructions or are inapplicable and, therefore, have been omitted. 3. Exhibits Exhibit Number Description 3.1 Restated Certificate of Incorporation, as amended. (Incorporated by reference from the Form 10-Q for Regeneron Pharmaceuticals, Inc. (the "Registrant"), for the quarter ended June 30, 2015, filed August 4, 2015.) 3.2 Amended and Restated By-Laws. (Incorporated by reference from the Form 8-K for the Registrant filed December 21, 2016.) 3.2.1 Amendment to the Amended and Restated By-Laws effective June 9, 2023. (Incorporated by reference from the Form 8-K for the Registrant filed June 14, 2023.) 4.1 Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2019, filed February 7, 2020.) 4.2 Indenture, dated August 12, 2020, between the Registrant and U.S. Bank National Association. (Incorporated by reference from the Form 8-K for the Registrant, filed August 12, 2020.) 4.3 First Supplemental Indenture, dated August 12, 2020, between the Registrant and U.S. Bank National Association. (Incorporated by reference from the Form 8-K for the Registrant, filed August 12, 2020.) 4.4 Form of 1.750% Senior Note due 2030 (included in Exhibit 4.3). 4.5 Form of 2.800% Senior Note due 2050 (included in Exhibit 4.3). 10.1 + Regeneron Pharmaceuticals, Inc. Second Amended and Restated 2000 Long-Term Incentive Plan. (Incorporated by reference from the Registration Statement on Form S-8 for the Registrant, filed June 13, 2011.) 10.1.1 + Form of option agreement and related notice of grant for use in connection with the grant of time based vesting stock options to the Registrant's non-employee directors and executive officers under the Regeneron Pharmaceuticals, Inc. Second Amended and Restated 2000 Long-Term Incentive Plan. (Incorporated by reference from the Form 10-Q for the Registrant, for the quarter ended March 31, 2009, filed April 30, 2009.) 10.1.2 + Form of option agreement and related notice of grant for use in connection with the grant of time based vesting stock options to the Registrant's non-employee directors under the Regeneron Pharmaceuticals, Inc. Second Amended and Restated 2000 Long-Term Incentive Plan (revised). (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2011, filed February 21, 2012.) 10.1.3 + Amendment No. 1 to the Regeneron Pharmaceuticals, Inc. Second Amended and Restated 2000 Long-Term Incentive Plan. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2013, filed February 13, 2014.) 10.2 + Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan. (Incorporated by reference from the Registration Statement on Form S-8 for the Registrant, filed June 12, 2017.) 10.2.1 + Form of stock option agreement and related notice of grant for use in connection with the grant of non-qualified stock options to the Registrant's executive officers under the Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan. (Incorporated by reference from the Form 8-K for the Registrant, filed June 18, 2014.) 10.2.2 + Form of restricted stock award agreement and related notice of grant for use in connection with the grant of restricted stock awards to the Registrant's executive officers under the Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan. (Incorporated by reference from the Form 8-K for the Registrant, filed June 18, 2014.) 10.2.3 + Form of stock option agreement and related notice of grant for use in connection with the grant of non-qualified stock options to the Registrant's non-employee directors under the Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan. (Incorporated by reference from the Form 8-K for the Registrant, filed June 18, 2014.) 10.2.4 + Form of stock option agreement and related notice of grant for use in connection with the grant of non-qualified stock options to the Registrant's executive officers under the Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (revised). (Incorporated by reference from the Form 8-K for the Registrant, filed November 19, 2015.) 92 Table of Contents 10.2.5 + Form of restricted stock award agreement and related notice of grant for use in connection with the grant of restricted stock awards to the Registrant's executive officers under the Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (revised). (Incorporated by reference from the Form 8-K for the Registrant, filed November 19, 2015.) 10.2.6 + Form of stock option agreement and related notice of grant for use in connection with the grant of non-qualified stock options to the Registrant's non-employee directors under the Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (revised). (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2015, filed February 11, 2016.) 10.2.7 + Form of stock option agreement and related notice of grant for use in connection with the grant of non-qualified stock options to the Registrant's executive officers under the Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2017, filed February 8, 2018.) 10.2.8 + Form of restricted stock award agreement and related notice of grant for use in connection with the grant of restricted stock awards to the Registrant's executive officers under the Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2017, filed February 8, 2018.) 10.2.9 + Form of stock option agreement and related notice of grant for use in connection with the grant of non-qualified stock options to the Registrant's non-employee directors under the Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2017, filed February 8, 2018.) 10.2.10 + Form of stock option agreement and related notice of grant for use in connection with the grant of non-qualified stock options to the Registrant's executive officers under the Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (revised 2018). (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2018, filed February 7, 2019.) 10.2.11 + Form of restricted stock award agreement and related notice of grant for use in connection with the grant of restricted stock awards to the Registrant's executive officers under the Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (revised 2018). (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2018, filed February 7, 2019.) 10.2.12 + Form of stock option agreement and related notice of grant for use in connection with the grant of non-qualified stock options to the Registrant's non-employee directors under the Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (revised 2018). (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2018, filed February 7, 2019.) 10.2.13 + Form of restricted stock unit award agreement and related notice of grant for use in connection with the grant of restricted stock units to the Registrant's non-employee directors under the Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2018, filed February 7, 2019.) 10.2.14 + Form of stock option agreement and related notice of grant for use in connection with the grant of non-qualified stock options to the Registrant's executive officers under the Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (revised 2019). (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2019, filed February 7, 2020.) 10.2.15 + Form of restricted stock award agreement and related notice of grant for use in connection with the grant of restricted stock awards to the Registrant's executive officers under the Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (revised 2019). (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2019, filed February 7, 2020.) 10.2.16 + Form of stock option agreement and related notice of grant for use in connection with the grant of non-qualified stock options to the Registrant's non-employee directors under the Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (revised 2019). (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2019, filed February 7, 2020.) 10.2.17 + Form of restricted stock unit award agreement and related notice of grant for use in connection with the grant of restricted stock units to the Registrant's non-employee directors under the Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (revised 2019). (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2019, filed February 7, 2020.) 10.3 + Second Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan. (Incorporated by reference from the Registration Statement on Form S-8 for the Registrant, filed June 16, 2020.) 10.3.1 + Form of stock option agreement and related notice of grant for use in connection with the grant of non-qualified stock options to the Registrant's executive officers under the Second Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2020, filed February 8, 2021.) 10.3.2 + Form of restricted stock award agreement and related notice of grant for use in connection with the grant of restricted stock awards to the Registrant's executive officers under the Second Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2020, filed February 8, 2021.) 93 Table of Contents 10.3.3 + Form of stock option agreement and related notice of grant for use in connection with the grant of non-qualified stock options to the Registrant's non-employee directors under the Second Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2020, filed February 8, 2021.) 10.3.4 + Form of restricted stock unit award agreement and related notice of grant for use in connection with the grant of restricted stock units to the Registrant's non-employee directors under the Second Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2020, filed February 8, 2021.) 10.3.5 + Form of performance restricted stock unit award agreement and related notice of grant for use in connection with the grant of performance restricted stock units to Leonard S. Schleifer, M.D., Ph.D. and George D. Yancopoulos, M.D., Ph.D. under the Second Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2020, filed February 8, 2021.) 10.3.6 + Form of stock option agreement and related notice of grant for use in connection with the grant of non-qualified stock options to the Registrant's executive officers under the Second Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (revised 2023) . 10.3.7 + Form of restricted stock award agreement and related notice of grant for use in connection with the grant of restric ted stock awards to the Registrant's executive officers under the Second Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (revised 2023). 10.4 + Amended and Restated Employment Agreement, dated as of November 14, 2008, between the Registrant and Leonard S. Schleifer, M.D., Ph.D. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2008, filed February 26, 2009.) 10.4.1 + Waiver and Consent, dated as of April 14, 2023, pursuant to the Amended and Restated Employment Agreement, dated as of November 14, 2008, between the Registrant and Leonard S. Schleifer, M.D., Ph.D. (Incorporated by reference from the Form 10-Q for the Registrant, for the quarter ended June 30, 2023, filed August 3, 2023 .) 10.5 + Offer Letter for Robert E. Landry effective September 9, 2013. (Incorporated by reference from the Form 8-K for the Registrant, filed September 12, 2013.) 10.6 + Regeneron Pharmaceuticals, Inc. Change in Control Severance Plan, amended and restated effective as of November 14, 2008. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2008, filed February 26, 2009.) 10.7 + Regeneron Pharmaceuticals, Inc. Cash Incentive Bonus Plan. (Incorporated by reference from the Form 8-K for the Registrant, filed June 17, 2015.) 10.7.1 + First Amendment to Cash Incentive Bonus Plan. (Incorporated by reference from the Form 10-Q for the Registrant, for the quarter ended March 31, 2023, filed May 4, 2023.) 10.8* IL-1 Antibody Termination Agreement by and between Novartis Pharma AG, Novartis Pharmaceuticals Corporation and the Registrant, dated as of June 8, 2009. (Incorporated by reference from the Form 10-Q for the Registrant, for the quarter ended June 30, 2009, filed August 4, 2009.) 10.9* License and Collaboration Agreement, dated as of October 18, 2006, by and between Bayer HealthCare LLC and the Registrant. (Incorporated by reference from the Form 10-Q for the Registrant, for the quarter ended September 30, 2006, filed November 6, 2006.) 10.9.1* Restated Amendment Agreement, dated December 30, 2014 and entered into effective as of May 7, 2012, by and between Bayer HealthCare LLC and the Registrant. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2014, filed February 12, 2015.) 10.9.2** Second Amendment Agreement, dated December 19, 2019, by and between Bayer HealthCare LLC and the Registrant. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2019, filed February 7, 2020.) 10.10* Amended and Restated License and Collaboration Agreement, dated as of November 10, 2009, by and among Aventis Pharmaceuticals Inc., sanofi-aventis Amerique du Nord, and the Registrant. (Incorporated by reference from the Form 10-K/A for the Registrant, for the year ended December 31, 2009, filed June 2, 2010.) 10.10.1** First Amendment to Amended and Restated License and Collaboration Agreement by and between the Registrant and Aventis Pharmaceuticals Inc., dated May 1, 2013. (Incorporated by reference from the Form 10-Q for the Registrant, for the quarter ended June 30, 2023, filed August 3, 2023.) 10.10.2* Amendment No. 2 to Amended and Restated License and Collaboration Agreement, dated July 27, 2015 and entered into effective as of July 1, 2015, by and between the Registrant and Sanofi Biotechnology SAS, as successor-in-interest to Aventis Pharmaceuticals, Inc. (Incorporated by reference from the Form 10-Q for the Registrant, for the quarter ended September 30, 2015, filed November 4, 2015.) 10.10.3** Third Amendment to Amended and Restated License and Collaboration Agreement, dated as of April 5, 2020, and effective as of April 1, 2020, by and between the Registrant, Sanofi Biotechnology SAS, and Sanofi. (Incorporated by reference from the Form 10-Q for the Registrant, for the quarter ended June 30, 2020, filed August 5, 2020.) 94 Table of Contents 10.10.4** Fourth Amendment to Amended and Restated License and Collaboration Agreement, dated as of October 6, 2021, by and between the Registrant, Sanofi Biotechnology SAS, and Sanofi. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2021, filed February 7, 2022.) 10.10.5** Fifth Amendment to Amended and Restated License and Collaboration Agreement, dated as of June 1, 2022, by and between the Registrant, Sanofi Biotechnology SAS, and Sanofi. (Incorporated by reference from the Form 10-Q for the Registrant, for the quarter ended June 30, 2022, filed August 3, 2022.) 10.11** Praluent Cross License & Commercialization Agreement, dated as of April 5, 2020, and effective as of April 1, 2020, by and between the Registrant and Sanofi Biotechnology SAS. (Incorporated by reference from the Form 10-Q for the Registrant, for the quarter ended June 30, 2020, filed August 5, 2020.) 10.12 Amended and Restated Investor Agreement, dated as of January 11, 2014, by and among Sanofi, sanofi-aventis US LLC, Aventis Pharmaceuticals Inc., sanofi-aventis Amerique du Nord, and the Registrant. (Incorporated by reference from the Form 8-K for the Registrant, filed January 13, 2014.) 10.12.1 Amendment to the Amended and Restated Investor Agreement, dated as of May 25, 2020, by and among the Registrant, Sanofi, Sanofi-Aventis US LLC, and Aventisub LLC. (Incorporated by reference from the Form 8-K for the Registrant, filed May 29, 2020.) 10.13*** Credit Agreement, dated as of December 19, 2022, by and among the Registrant, as a borrower and guarantor, certain direct subsidiaries of the Registrant, as the initial subsidiary borrowers, the lenders and issuing banks party thereto, and JPMorgan Chase Bank, N.A., as administrative agent, swingline lender, and an issuing bank. (Incorporated by reference from the Form 8-K for the Registrant, filed December 20, 2022.) 10.14** Amended and Restated Immuno-oncology License and Collaboration Agreement, dated as of June 1, 2022, by and between the Registrant and Sanofi Biotechnology SAS. (Incorporated by reference from the Form 10-Q for the Registrant, for the quarter ended June 30, 2022, filed August 3, 2022.) 10.15* Purchase Agreement, dated as of December 30, 2016, by and among BMR-Landmark at Eastview LLC and BMR-Landmark at Eastview IV LLC and the Registrant. (Incorporated by reference from the Form 10-K for the Registrant, for the year ended December 31, 2016, filed February 9, 2017.) 10.16*** Third Amended and Restated Participation Agreement, dated as of March 27, 2023, by and among Old Saw Mill Holdings LLC, as lessee, Bank of America, N.A., as administrative agent, BA Leasing BSC, LLC, as lessor, and the rent assignees party thereto from time to time. (Incorporated by reference from the Form 8-K for the Registrant, filed March 29, 2023.) 10.17*** Third Amended and Restated Lease and Remedies Agreement, dated as of March 27, 2023, between Old Saw Mill Holdings LLC, as lessee, and BA Leasing BSC, LLC, as lessor. (Incorporated by reference from the Form 8-K for the Registrant, filed March 29, 2023.) 10.18*** Third Amended and Restated Guaranty, dated as of March 27, 2023, made by the Registrant, Regeneron Healthcare Solutions, Inc., and Regeneron Genetics Center LLC, as guarantors. (Incorporated by reference from the Form 8-K for the Registrant, filed March 29, 2023.) 10.19** Master Agreement, dated as of April 8, 2019, by and between the Registrant and Alnylam Pharmaceuticals, Inc. (Incorporated by reference from the Form 10-Q for the Registrant, for the quarter ended June 30, 2019, filed August 6, 2019.) 10.19.1** Form of Co-Co Collaboration Agreement (Exhibit B to Master Agreement contained in Exhibit 10. 19 ). 10.19.2** Form of License Agreement (Exhibit C to Master Agreement contained in Exhibit 10.19 ). 10.19.3** Amendment No. 1 to Master Agreement, dated as of April 10, 2023, by and between the Registrant and Alnylam Pharmaceuticals, Inc. (Incorporated by reference from the Form 10-Q for the Registrant, for the quarter ended June 30, 2023, filed August 3, 2023.) 21.1 Subsidiaries of the Registrant. 23.1 Consent of PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm. 24.1 Power of Attorney (included on the signature page of this Annual Report on Form 10-K). 31.1 Certification of Principal Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934. 31.2 Certification of Principal Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934. 32 Certification of Principal Executive Officer and Principal Financial Officer pursuant to 18 U.S.C. Section 1350. 97.1 Cl awback Policy. 101 Interactive Data Files pursuant to Rule 405 of Regulation S-T formatted in Inline Extensible Business Reporting Language ("Inline XBRL"): (i) the Registrant's Consolidated Balance Sheets as of December 31, 2023 and 2022; (ii) the Registrant's Consolidated Statements of Operations and Comprehensive Income for the years ended December 31, 2023, 2022, and 2021; (iii) the Registrant's Consolidated Statements of Stockholders’ Equity for the years ended December 31, 2023, 2022, and 2021; (iv) the Registrant's Consolidated Statements of Cash Flows for the years ended December 31, 2023, 2022, and 2021; and (v) the notes to the Registrant's Consolidated Financial Statements. 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). 95 Table of Contents _______ * Portions of this document have been omitted and filed separately with the SEC pursuant to requests for confidential treatment pursuant to Rule 24b-2. ** Certain confidential portions of this Exhibit were omitted in accordance with Item 601(b)(10) of Regulation S-K. The Registrant agrees to furnish supplementally a copy of all confidential portions of this Exhibit that were omitted to the SEC upon its request. *** Certain of the exhibits and/or schedules to this Exhibit have been omitted in accordance with Item 601(a)(5) of Regulation S-K. The Registrant agrees to furnish supplementally a copy of all omitted exhibits and schedules of this Exhibit to the SEC upon its request. + Indicates a management contract or compensatory plan or arrangement. Item 16. Form 10-K Summary None. 96 Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. REGENERON PHARMACEUTICALS, INC. Date: February 5, 2024 By: /s/ LEONARD S. SCHLEIFER Leonard S. Schleifer, M.D., Ph.D. President and Chief Executive Officer 97 Table of Contents POWER OF ATTORNEY KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Leonard S. Schleifer and Christopher Fenimore, and each of them, his or her true and lawful attorney-in-fact and agent, with the full power of substitution and resubstitution, for him or her and in his or her name, place, and stead, in any and all capacities therewith, to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, granting unto each said attorney-in-fact and agent full power and authority to do and perform each and every act and thing requisite and necessary to be done, as fully to all intents and purposes as such person might or could do in person, hereby ratifying and confirming all that each said attorney-in-fact and agent, or either of them, or their or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated: Signature Title Date /s/ LEONARD S. SCHLEIFER Board Co-Chair, President and Chief Executive Officer (Principal Executive Officer) February 5, 2024 Leonard S. Schleifer, M.D., Ph.D. /s/ ROBERT E. LANDRY Executive Vice President, Finance and Chief Financial Officer (Principal Financial Officer) February 5, 2024 Robert E. Landry /s/ CHRISTOPHER FENIMORE Senior Vice President, Controller (Principal Accounting Officer) February 5, 2024 Christopher Fenimore /s/ GEORGE D. YANCOPOULOS Board Co-Chair, President and Chief Scientific Officer February 5, 2024 George D. Yancopoulos, M.D., Ph.D. /s/ BONNIE L. BASSLER Director February 5, 2024 Bonnie L. Bassler, Ph.D. /s/ MICHAEL S. BROWN Director February 5, 2024 Michael S. Brown, M.D. /s/ N. ANTHONY COLES Director February 5, 2024 N. Anthony Coles, M.D. /s/ JOSEPH L. GOLDSTEIN Director February 5, 2024 Joseph L. Goldstein, M.D. /s/ KATHRYN GUARINI Director February 5, 2024 Kathryn Guarini, Ph.D. /s/ CHRISTINE A. POON Director February 5, 2024 Christine A. Poon /s/ ARTHUR F. RYAN Director February 5, 2024 Arthur F. Ryan /s/ DAVID P. SCHENKEIN Director February 5, 2024 David P. Schenkein, M.D. /s/ GEORGE L. SING Director February 5, 2024 George L. Sing /s/ CRAIG B. THOMPSON Director February 5, 2024 Craig B. Thompson, M.D. /s/ HUDA Y. ZOGHBI Director February 5, 2024 Huda Y. Zoghbi, M.D. 98 Table of Contents REGENERON PHARMACEUTICALS, INC. INDEX TO FINANCIAL STATEMENTS Page Numbers Report of Independent Registered Public Accounting Firm (PCAOB ID 238 ) F- 2 Consolidated Balance Sheets as of December 31, 202 3 and 202 2 F- 4 Consolidated Statements of Operations and Comprehensive Income for the Years Ended December 31, 202 3 , 202 2 , and 202 1 F- 5 Consolidated Statements of Stockholders' Equity for the Years Ended December 31, 202 3 , 202 2 , and 202 1 F- 6 Consolidated Statements of Cash Flows for the Years Ended December 31, 202 3 , 202 2 , and 202 1 F- 8 Notes to Consolidated Financial Statements F- 9 to F- 46 F-1 Table of Contents Report of Independent Registered Public Accounting Firm To the Board of Directors and Stockholders of Regeneron Pharmaceuticals, Inc. Opinions on the Financial Statements and Internal Control over Financial Reporting We have audited the accompanying consolidated balance sheets of Regeneron Pharmaceuticals, Inc. and its subsidiaries (the "Company") as of December 31, 2023 and 2022, and the related consolidated statements of operations and comprehensive income, of stockholders' equity and of cash flows for each of the three years in the period ended December 31, 2023, including the related notes (collectively referred to as the "consolidated financial statements"). We also have audited the Company's internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2023 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO. Basis for Opinions The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management's Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company's consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. Definition and Limitations of Internal Control over Financial Reporting A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements. F-2 Table of Contents Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Critical Audit Matters The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Reserve for an Uncertain Tax Position As described in Notes 1 and 15 to the consolidated financial statements, the Company's reserves for uncertain tax positions were $ 696.4 million as of December 31, 2023. A reserve for an individual uncertain tax position represents a portion of the consolidated balance. The Company recognizes the financial statement effects of a tax position when management's assessment is that there is more than a 50% probability that the position will be sustained upon examination by a taxing authority based upon its technical merits. Uncertain tax positions are recorded based upon certain recognition and measurement criteria. Management re-evaluates uncertain tax positions and considers various factors, including, but not limited to, changes in tax law, the measurement of tax positions taken or expected to be taken in tax returns, and changes in facts or circumstances related to a tax position. The Company adjusts the amount of the liability to reflect any subsequent changes in the relevant facts and circumstances surrounding the uncertain tax positions. The principal considerations for our determination that performing procedures relating to the reserve for an uncertain tax position is a critical audit matter are (i) the significant judgment by management when determining the reserve for the uncertain tax position; (ii) a high degree of auditor judgment, subjectivity and effort in performing procedures and evaluating management's determination of the reserve for the uncertain tax position; (iii) the assessment and evaluation of audit evidence available to support the reserve for the uncertain tax position is complex, and (iv) the audit effort involved the use of professionals with specialized skill and knowledge. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to the recognition of reserves for uncertain tax positions. These procedures also included, among others, (i) testing the information used in the calculation of the reserve for the individual uncertain tax position, such as international and federal filing positions, and the related final tax returns; (ii) testing the calculation of the reserve for the uncertain tax position; and (iii) evaluating management's assessment of the technical merits of tax positions and estimates of the amount of tax benefit expected to be sustained, as well as the likelihood of the possible outcome. Professionals with specialized skills and knowledge were used to assist in evaluating the technical merits and the tax benefit expected to be sustained and the application of relevant tax laws. /s/ PricewaterhouseCoopers LLP Florham Park, New Jersey February 5, 2024 We have served as the Company’s auditor since 1989. F-3 Table of Contents REGENERON PHARMACEUTICALS, INC. CONSOLIDATED BALANCE SHEETS (In millions, except per share data) December 31, 2023 2022 ASSETS Current assets: Cash and cash equivalents $ 2,730.0 $ 3,105.9 Marketable securities 8,114.8 4,636.4 Accounts receivable, net 5,667.3 5,328.7 Inventories 2,580.5 2,401.9 Prepaid expenses and other current assets 386.6 411.2 Total current assets 19,479.2 15,884.1 Marketable securities 5,396.5 6,591.8 Property, plant, and equipment, net 4,146.4 3,763.0 Intangible assets, net 1,038.6 915.5 Deferred tax assets 2,575.4 1,723.7 Other noncurrent assets 444.1 336.4 Total assets $ 33,080.2 $ 29,214.5 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable $ 606.6 $ 589.2 Accrued expenses and other current liabilities 2,357.9 2,074.2 Deferred revenue 458.9 477.9 Total current liabilities 3,423.4 3,141.3 Long-term debt 1,982.9 1,981.4 Finance lease liabilities 720.0 720.0 Deferred revenue 126.7 69.8 Other noncurrent liabilities 854.1 638.0 Total liabilities 7,107.1 6,550.5 Commitments and contingencies Stockholders' equity: Preferred Stock, par value $ .01 per share; 30.0 shares authorized; shares issued and outstanding - none — — Class A Stock, convertible, par value $ .001 per share; 40.0 shares authorized; shares issued and outstanding - 1.8 in 2023 and 2022 — — Common Stock, par value $ .001 per share; 320.0 shares authorized; shares issued - 133.1 in 2023 and 130.4 in 2022 0.1 0.1 Additional paid-in capital 11,354.0 9,949.3 Retained earnings 27,260.3 23,306.7 Accumulated other comprehensive loss ( 80.9 ) ( 238.8 ) Treasury Stock, at cost; 25.5 shares in 2023 and 22.6 shares in 2022 ( 12,560.4 ) ( 10,353.3 ) Total stockholders' equity 25,973.1 22,664.0 Total liabilities and stockholders' equity $ 33,080.2 $ 29,214.5 The accompanying notes are an integral part of the financial statements. F-4 Table of Contents REGENERON PHARMACEUTICALS, INC. CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (In millions, except per share data) Year Ended December 31, 2023 2022 2021 Statements of Operations Revenues: Net product sales $ 7,078.0 $ 6,893.7 $ 12,117.2 Collaboration revenue 5,503.1 4,914.1 3,673.3 Other revenue 536.1 365.1 281.2 13,117.2 12,172.9 16,071.7 Expenses: Research and development 4,439.0 3,592.5 2,860.1 Acquired in-process research and development 186.1 255.1 48.0 Selling, general, and administrative 2,631.3 2,115.9 1,824.9 Cost of goods sold 932.1 800.0 1,773.1 Cost of collaboration and contract manufacturing 883.7 760.4 664.4 Other operating (income) expense, net ( 2.1 ) ( 89.9 ) ( 45.6 ) 9,070.1 7,434.0 7,124.9 Income from operations 4,047.1 4,738.9 8,946.8 Other income (expense): Other income (expense), net 225.2 179.3 436.3 Interest expense ( 73.0 ) ( 59.4 ) ( 57.3 ) 152.2 119.9 379.0 Income before income taxes 4,199.3 4,858.8 9,325.8 Income tax expense 245.7 520.4 1,250.5 Net income $ 3,953.6 $ 4,338.4 $ 8,075.3 Net income per share - basic $ 37.05 $ 40.51 $ 76.40 Net income per share - diluted $ 34.77 $ 38.22 $ 71.97 Weighted average shares outstanding - basic 106.7 107.1 105.7 Weighted average shares outstanding - diluted 113.7 113.5 112.2 Statements of Comprehensive Income Net income $ 3,953.6 $ 4,338.4 $ 8,075.3 Other comprehensive income (loss), net of tax: Unrealized gain (loss) on debt securities 158.2 ( 213.6 ) ( 56.4 ) Loss on foreign currency translation ( 0.3 ) — — Unrealized gain on cash flow hedges — 1.0 0.9 Comprehensive income $ 4,111.5 $ 4,125.8 $ 8,019.8 The accompanying notes are an integral part of the financial statements. F-5 Table of Contents REGENERON PHARMACEUTICALS, INC. CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (In millions) Class A Stock Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Total Stockholders' Equity Shares Amount Shares Amount Shares Amount Balance, December 31, 2020 1.8 $ — 121.5 $ 0.1 $ 6,716.2 $ 10,893.0 $ 29.3 ( 16.4 ) $ ( 6,613.3 ) $ 11,025.3 Issuance of Common Stock for equity awards granted under long-term incentive plans — — 6.2 — 1,676.0 — — — — 1,676.0 Common Stock tendered upon exercise of stock options and vesting of restricted stock for employee tax obligations — — ( 1.5 ) — ( 944.6 ) — — — — ( 944.6 ) Issuance/distribution of Common Stock for 401(k) Savings Plan — — — — 40.7 — — 0.1 7.4 48.1 Repurchases of Common Stock — — — — — — — ( 3.1 ) ( 1,655.0 ) ( 1,655.0 ) Stock-based compensation charges — — — — 599.2 — — — — 599.2 Net income — — — — — 8,075.3 — — — 8,075.3 Other comprehensive loss, net of tax — — — — — — ( 55.5 ) — — ( 55.5 ) Balance, December 31, 2021 1.8 — 126.2 0.1 8,087.5 18,968.3 ( 26.2 ) ( 19.4 ) ( 8,260.9 ) 18,768.8 Issuance of Common Stock for equity awards granted under long-term incentive plans — — 4.8 — 1,517.4 — — — — 1,517.4 Common Stock tendered upon exercise of stock options and vesting of restricted stock for employee tax obligations — — ( 0.6 ) — ( 445.7 ) — — — — ( 445.7 ) Issuance/distribution of Common Stock for 401(k) Savings Plan — — — — 52.3 — — 0.1 7.4 59.7 Repurchases of Common Stock — — — — — — — ( 3.3 ) ( 2,099.8 ) ( 2,099.8 ) Stock-based compensation charges — — — — 737.8 — — — — 737.8 Net income — — — — — 4,338.4 — — — 4,338.4 Other comprehensive loss, net of tax — — — — — — ( 212.6 ) — — ( 212.6 ) Balance, December 31, 2022 1.8 — 130.4 0.1 9,949.3 23,306.7 ( 238.8 ) ( 22.6 ) ( 10,353.3 ) 22,664.0 F-6 Table of Contents CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (continued) Class A Stock Common Stock Additional Paid-in Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) Treasury Stock Total Stockholders' Equity Shares Amount Shares Amount Shares Amount Issuance of Common Stock for equity awards granted under long-term incentive plans — — 3.5 — 1,152.2 — — — — 1,152.2 Common Stock tendered upon exercise of stock options and vesting of restricted stock for employee tax obligations — — ( 0.8 ) — ( 708.4 ) — — — — ( 708.4 ) Issuance/distribution of Common Stock for 401(k) Savings Plan — — — — 66.6 — — 0.1 7.5 74.1 Repurchases of Common Stock — — — — — — — ( 3.0 ) ( 2,214.6 ) ( 2,214.6 ) Stock-based compensation charges — — — — 894.3 — — — — 894.3 Net income — — — — — 3,953.6 — — — 3,953.6 Other comprehensive income, net of tax — — — — — — 157.9 — — 157.9 Balance, December 31, 2023 1.8 $ — 133.1 $ 0.1 $ 11,354.0 $ 27,260.3 $ ( 80.9 ) ( 25.5 ) $ ( 12,560.4 ) $ 25,973.1 The accompanying notes are an integral part of the financial statements. F-7 Table of Contents REGENERON PHARMACEUTICALS, INC. CONSOLIDATED STATEMENTS OF CASH FLOWS (In millions) Year Ended December 31, 2023 2022 2021 Cash flows from operating activities: Net income $ 3,953.6 $ 4,338.4 $ 8,075.3 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 421.0 341.4 286.2 Stock-based compensation expense 885.0 725.0 601.7 Losses (gains) on marketable and other securities, net 266.4 36.8 ( 387.0 ) Other non-cash items, net ( 0.1 ) 368.0 568.7 Deferred income taxes ( 837.8 ) ( 746.4 ) ( 147.1 ) Acquired in-process research and development in connection with asset acquisition — 195.0 — Changes in assets and liabilities: (Increase) decrease in accounts receivable ( 338.8 ) 707.8 ( 1,927.4 ) Increase in inventories ( 271.7 ) ( 696.5 ) ( 494.3 ) Increase in prepaid expenses and other assets ( 120.1 ) ( 148.6 ) ( 240.7 ) Increase (decrease) in deferred revenue 37.9 32.4 ( 120.2 ) Increase (decrease) in accounts payable, accrued expenses, and other liabilities 598.6 ( 138.4 ) 866.1 Total adjustments 640.4 676.5 ( 994.0 ) Net cash provided by operating activities 4,594.0 5,014.9 7,081.3 Cash flows from investing activities: Purchases of marketable and other securities ( 11,646.0 ) ( 7,487.9 ) ( 7,048.1 ) Sales or maturities of marketable and other securities 9,442.2 5,550.5 2,215.3 Capital expenditures ( 718.6 ) ( 590.1 ) ( 551.9 ) Payments for Libtayo intangible asset ( 207.8 ) ( 1,026.8 ) — Acquisitions, net of cash acquired ( 54.9 ) ( 230.3 ) — Net cash used in investing activities ( 3,185.1 ) ( 3,784.6 ) ( 5,384.7 ) Cash flows from financing activities: Proceeds from issuance of Common Stock 1,145.5 1,519.5 1,672.3 Payments in connection with Common Stock tendered for employee tax obligations ( 700.6 ) ( 445.7 ) ( 1,032.7 ) Repurchases of Common Stock ( 2,235.0 ) ( 2,082.8 ) ( 1,645.4 ) Net cash used in financing activities ( 1,790.1 ) ( 1,009.0 ) ( 1,005.8 ) Effect of exchange rate changes on cash, cash equivalents, and restricted cash ( 0.4 ) — — Net (decrease) increase in cash, cash equivalents, and restricted cash ( 381.6 ) 221.3 690.8 Cash, cash equivalents, and restricted cash at beginning of period 3,119.4 2,898.1 2,207.3 Cash, cash equivalents, and restricted cash at end of period $ 2,737.8 $ 3,119.4 $ 2,898.1 Supplemental disclosure of cash flow information Cash paid for interest (net of amounts capitalized) $ 73.1 $ 53.7 $ 55.8 Cash paid for income taxes $ 870.3 $ 1,502.4 $ 1,218.4 The accompanying notes are an integral part of the financial statements. F-8 Table of Contents REGENERON PHARMACEUTICALS, INC. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. Business Overview and Summary of Significant Accounting Policies Organization and Business Regeneron Pharmaceuticals, Inc. and its subsidiaries ("Regeneron," "Company," "we," "us," and "our") is a fully integrated biotechnology company that invents, develops, manufactures, and commercializes medicines for people with serious diseases. The Company's products and product candidates in development are designed to help patients with eye diseases, allergic and inflammatory diseases, cancer, cardiovascular and metabolic diseases, hematologic conditions, infectious diseases, and rare diseases. The Company's research and development efforts have led to eleven products that have received marketing approval by the U.S. Food and Drug Administration ("FDA"). In addition, REGEN-COV ® was authorized under an Emergency Use Authorization ("EUA") from November 2020 until January 2022 when the EUA was revised to exclude its use in geographic regions where infection or exposure is likely due to a variant that is not susceptible to the treatment; as a result, REGEN-COV is not currently authorized for use in any U.S. states, territories, or jurisdictions. The Company is a party to collaboration agreements to develop and commercialize, as applicable, certain products and product candidates (see Note 3). The Company operates in one business segment, which includes all activities related to the discovery, development, and commercialization of medicines for serious diseases. The Company's business is subject to certain risks including, but not limited to, uncertainties relating to conducting research activities, product development, obtaining regulatory approvals, competition, and obtaining and enforcing patents. Basis of Presentation The consolidated financial statements include the accounts of Regeneron and its wholly-owned subsidiaries. Intercompany balances and transactions are eliminated in consolidation. Certain reclassifications have been made to prior period amounts to conform with the current period's presentation. Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates. Concentration of Credit Risk Financial instruments which potentially expose the Company to concentrations of credit risk consist of cash, cash equivalents, certain investments, and accounts receivable. In accordance with the Company's policies, the Company mandates asset diversification and monitors exposure with its counterparties. Concentrations of credit risk with respect to collaborator (see Note 3) and customer accounts receivable are significant. As of December 31, 2023 and 2022, two individual customers accounted for 83 % and 86 % of the Company's net trade accounts receivable balances, respectively. The Company has contractual payment terms with each of its collaborators and customers, and the Company monitors their financial performance and credit worthiness so that it can properly assess and respond to any changes in their credit profile. As of December 31, 2023 and 2022, there were no write-offs and allowances of accounts receivable related to credit risk for the Company's collaborators or customers. Significant Accounting Policies Cash and Cash Equivalents The Company considers all highly liquid debt instruments with a maturity of three months or less when purchased to be cash equivalents. The carrying amount reported in the Consolidated Balance Sheet for cash and cash equivalents approximates its fair value. Debt and Equity Securities The Company has an investment policy that includes guidelines on acceptable investment securities, minimum credit quality, maturity parameters, and diversification. The Company invests its cash primarily in debt securities. The Company considers its investments in debt securities to be "available-for-sale," as defined by authoritative guidance issued by the Financial Accounting Standards Board ("FASB"). These assets are carried at fair value and the unrealized gains and losses are included in accumulated other comprehensive income (loss). Realized gains and losses on available-for-sale debt securities are included in other income F-9 Table of Contents (expense), net. The Company reviews its portfolio of available-for-sale debt securities, using both quantitative and qualitative factors, to determine if declines in fair value below cost have resulted from a credit-related loss or other factors. If the decline in fair value is due to credit-related factors, a loss is recognized in net income, whereas if the decline in fair value is not due to credit-related factors, the loss is recorded in other comprehensive income (loss). The Company also has investments in equity securities that are carried at fair value with changes in fair value recognized within other income (expense), net. The Company has elected to measure certain equity investments it holds that do not have readily determinable fair values at cost less impairment, if any, and adjusts for observable price changes in orderly transactions for identical or similar investments of the same issuer within other income (expense), net. Accounts Receivable The Company's trade accounts receivable arise from product sales and represent amounts due from its customers. In addition, the Company records accounts receivable arising from its collaboration and licensing agreements. The Company monitors the financial performance and credit worthiness of its counterparties so that it can properly assess and respond to changes in their credit profile. The Company provides allowances against receivables for estimated losses, if any, that may result from a counterparty's inability to pay. Amounts determined to be uncollectible are written-off against the allowance. Inventories Inventories are stated at the lower of cost or net realizable value. The Company determines the cost of inventory using the first-in, first-out, or FIFO, method. The Company capitalizes inventory costs associated with the Company's products prior to regulatory approval when, based on management's judgment, future commercialization is considered probable and the future economic benefit is expected to be realized; otherwise, such costs are expensed. The determination to capitalize inventory costs is based on various factors, including status and expectations of the regulatory approval process, any known safety or efficacy concerns, potential labeling restrictions, and any other impediments to obtaining regulatory approval. The Company periodically analyzes its inventory levels to identify inventory that may expire prior to expected sale or has a cost basis in excess of its estimated realizable value, and writes down such inventories as appropriate. In addition, the Company's products are subject to strict quality control and monitoring which the Company performs throughout the manufacturing process. If certain batches or units of product no longer meet quality specifications or become obsolete due to expiration, the Company records a charge to write down such inventory to its estimated realizable value. Property, Plant, and Equipment Property, plant, and equipment are stated at cost, net of accumulated depreciation. Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets. Leasehold improvements are amortized over the shorter of the estimated useful lives of the assets or the remaining lease term. Costs of construction of certain long-lived assets include capitalized interest, which is amortized over the estimated useful life of the related asset. Expenditures for maintenance and repairs which do not materially extend the useful lives of the assets are charged to expense as incurred. The cost and accumulated depreciation or amortization of assets retired or sold are removed from the respective accounts, and any gain or loss is recognized within income from operations. The estimated useful lives of property, plant, and equipment are as follows: Building and improvements 10 – 50 years Laboratory and other equipment 3 – 10 years Furniture and fixtures 5 years The Company periodically assesses the recoverability of long-lived assets, such as property, plant, and equipment, and evaluates such assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. F-10 Table of Contents Leases The Company determines if an arrangement is a lease considering whether there is an identified asset and the contract conveys the right to control its use. Leases with an initial term of 12 months or less are not recorded on the balance sheet. The Company may include options to extend or terminate a lease within the lease term when it is reasonably certain that it will exercise that option. The Company accounts for lease components (e.g., rental payments) separately from non-lease components (e.g., common area maintenance costs). Lease liabilities are recognized at the lease commencement date based on the present value of the remaining lease payments, discounted using the rate implicit in the lease. For leases where an implicit rate is not readily determinable, the Company uses its incremental borrowing rate based on information available at the lease commencement date to determine the present value of future lease payments. Lease expense for operating leases is recognized on a straight-line basis over the expected lease term. Acquisitions The Company makes a determination whether a transaction should be accounted for as a business combination or as an asset acquisition. 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 as indefinite-lived intangible assets. Any excess of the purchase price (consideration transferred) over the fair values of net assets acquired is recorded as goodwill. In a business combination, contingent consideration obligations are recorded at fair value as of the acquisition date and remeasured each subsequent reporting period until the contingencies have been resolved, with any changes in fair value recorded in Other operating (income) expense, net. If it is determined that the assets acquired do not meet the definition of a business, or if substantially all of the fair value of the assets acquired are concentrated in a single identifiable asset, then the transaction is accounted for as an asset acquisition rather than a business combination. In an asset acquisition, assets acquired are recorded at cost, goodwill is not recognized, and acquired in-process research and development with no alternative future use is charged to expense. Intangible Assets Intangible assets acquired in a business combination are recorded at fair value, while intangible assets acquired in connection with an asset acquisition are recorded at cost. Payments to acquire intangible assets in an asset acquisition may include up-front payments and contingent consideration. With regard to contingent consideration in an asset acquisition, the Company recognizes regulatory milestones upon achievement, royalties in the period in which the underlying sales occur, and sales-based milestones when the milestone is deemed probable by the Company of being achieved. If contingent consideration is recognized subsequent to the acquisition date in an asset acquisition, the amount of such consideration is recorded as an addition to the cost basis of the intangible asset with a cumulative catch-up adjustment for amortization expense as if the additional amount of consideration had been accrued from the outset of the acquisition. Indefinite-lived intangible assets are subject to impairment testing until completion or abandonment of the associated research and development efforts. Definite-lived intangible assets are amortized to Cost of goods sold over the estimated useful lives of the assets based on the pattern in which the economic benefits of the intangible assets are consumed; if that pattern cannot be reliably determined, a straight-line basis is used. Intangible assets are reviewed for recoverability whenever events or changes in circumstances indicate that the carrying amount of the asset may not be recoverable. If an indicator of impairment exists, the Company compares the projected undiscounted cash flows to be generated by the asset to the intangible asset's carrying amount. If the projected undiscounted cash flows of the intangible asset are less than the carrying amount, the intangible asset is written down to its fair value in the period in which the impairment occurs. Product Revenue Revenue from product sales is recognized at a point in time when the Company's customer is deemed to have obtained control of the product, which generally occurs upon receipt or acceptance by its customer. The amount of revenue the Company recognizes from product sales may vary due to rebates, chargebacks, and discounts provided under governmental and other programs, distribution-related fees, and other sales-related deductions. In order to determine the transaction price, the Company estimates, utilizing the expected value method, the amount of variable consideration to which the Company will be entitled. This estimate is based upon contracts with customers, healthcare providers, payors, and government agencies, statutorily-defined discounts applicable to government-funded programs, historical experience, estimated payor mix, F-11 Table of Contents and other relevant factors. The Company reviews its estimates of rebates, chargebacks, and other applicable provisions each period and records any necessary adjustments in the current period's net product sales. • Rebates: The Company's rebates include amounts paid to managed care organizations, group purchasing organizations, state Medicaid programs, and other rebate programs. The Company estimates reductions to product sales for each type of rebate and records an allowance for rebates in the same period in which the related product sales are recognized. The Company's liability for rebates consists of estimates for claims related to the current and prior periods that have not been paid and estimates for claims that will be made related to product that exists in the distribution channel at the end of the period. • Chargebacks and Discounts: The Company's reserves related to discounted pricing to eligible physicians, Veterans' Administration ("VA"), Public Health Services, and others (collectively "qualified healthcare providers") represent the Company's estimated obligations resulting from contractual commitments to sell products to qualified healthcare providers at prices lower than the list prices the Company charges to its customers (i.e., distributors and specialty pharmacies). The Company's customers charge the Company for the difference between what they pay for the products and the discounted selling price to the qualified healthcare providers. The Company estimates reductions to product sales for each type of chargeback and records an allowance for chargebacks in the same period that the related product sales are recognized. The Company's reserve for chargebacks consists of amounts for which it expects to issue credit based on expected sales by its customers to qualified healthcare providers and chargebacks that customers have claimed but for which the Company has not yet issued credit. • Distribution-Related Fees: The Company has written contracts with its customers that include terms for distribution-related fees. The Company estimates and records distribution and related fees due to its customers generally based on gross sales. • Other Sales-Related Deductions : The Company's other sales-related deductions include co-pay assistance programs and product returns. The Company estimates and records other sales-related deductions generally based on gross sales, written contracts, and other relevant factors. Consistent with industry practice, the Company generally offers its customers a limited right to return product purchased directly from the Company, which is principally based upon the product's expiration date. Product returned is generally not resalable given the nature of the Company's products and method of administration. The Company develops estimates for product returns based upon historical experience, shelf life of the product, and other relevant factors. The Company monitors product supply levels in the distribution channel, as well as sales by its customers, using product-specific data provided by its customers. If necessary, the Company's estimates of product returns may be adjusted in the future based on actual returns experience, known or expected changes in the marketplace, or other factors. Collaborative Arrangements The Company has entered into various collaborative arrangements to research, develop, manufacture, and commercialize products and/or product candidates. Although each of these arrangements is unique in nature, such arrangements involve a joint operating activity where both parties are active participants in the activities of the collaboration and exposed to significant risks and rewards dependent on the commercial success of the activities. In arrangements where the Company does not deem its collaborator to be its customer, payments to and from its collaborator are presented in the Company's statement of operations based on the nature of our business operations, the nature of the arrangement, including the contractual terms, and the nature of the payments. In general, the presentation of such amounts is summarized below. F-12 Table of Contents Nature/Type of Payment Statement of Operations Presentation Regeneron's share of profits or losses in connection with commercialization of products Collaboration revenue Reimbursement for manufacturing of commercial supplies Collaboration revenue Royalties and/or sales-based milestones earned Collaboration revenue Reimbursement of Regeneron's research and development expenses Reduction to Research and development expenses Regeneron's obligation for its share of collaborator's research and development expenses Research and development expense Up-front/opt-in and development milestone payments to collaborators Acquired in-process research and development expense Reimbursement of Regeneron's commercialization-related expenses Reduction to Selling, general, and administrative expense Regeneron's obligation for its share of collaborator's commercialization-related expenses Selling, general, and administrative expense Regeneron's obligation to pay collaborator for its share of gross profits when Regeneron is deemed to be the principal Cost of goods sold Up-front and development milestones earned (when there is a combined unit of account which includes a license and providing research and development services) Other operating income In agreements involving multiple goods or services promised to be transferred to the Company's collaborator, the Company assesses, at the inception of the contract, whether each promise represents a separate obligation (i.e., is "distinct"), or whether such promises should be combined as a single unit of account. When the Company has a combined unit of account which includes a license and providing research and development services to its collaborator, recognition of up-front payments and development milestones earned from its collaborator is deferred (as a liability) and recognized over the development period (i.e., over time) typically using an input method on the basis of the Company's research and development costs incurred relative to the total expected cost which determines the extent of the Company's progress toward completion. The Company reviews its estimates each period and makes revisions to such estimates as necessary. When the Company is entitled to reimbursement of all or a portion of the expenses (e.g., research and development expenses) that it incurs under a collaboration, it records those reimbursable amounts in the period in which such costs are incurred. If the Company's collaborator performs research and development work or commercialization-related activities and the parties share the related costs, the Company also recognizes, as expense (e.g., research and development expense or selling, general, and administrative expense, as applicable) in the period when its collaborator incurs such expenses, the portion of the collaborator's expenses that the Company is obligated to reimburse. The Company's collaborators provide the Company with estimated expenses for the most recent fiscal quarter. The estimates are revised, if necessary, in subsequent periods if actual expenses differ from those estimates. Under certain of the Company's collaboration agreements, product sales and cost of sales may be recorded by the Company's collaborators as they are deemed to be the principal in the transaction. In arrangements where the Company: • supplies commercial product to its collaborator, the Company may be reimbursed for its manufacturing costs as commercial product is shipped to the collaborator (however, recognition of such cost reimbursements may be deferred until the product is sold by the Company's collaborator to third-party customers); • shares in any profits or losses arising from the commercialization of such products, the Company records its share of the variable consideration, representing net product sales less cost of goods sold and shared commercialization and other expenses, in the period in which such underlying sales occur and costs are incurred by the collaborator; • receives royalties and/or sales-based milestone payments from its collaborator, the Company recognizes such amounts in the period earned. The Company's collaborators provide it with estimates of product sales and the Company's share of profits or losses, as applicable, for each quarter. The estimates are revised, if necessary, in subsequent periods if the Company's actual share of profits or losses differ from those estimates. Research and Development Expenses Research and development expenses include costs attributable to the conduct of research and development programs, including the cost of salaries, payroll taxes, employee benefits, materials, supplies, depreciation on and maintenance of research equipment, F-13 Table of Contents costs related to research collaboration and licensing agreements, clinical trial expenses, the cost of services provided by outside contractors, including services related to the Company's clinical trials, the cost of manufacturing drug for use in research and development, amounts that the Company is obligated to reimburse to collaborators for research and development expenses that they incur, and the allocable portions of facility costs. Costs associated with research and development are expensed. For each clinical trial that the Company conducts, certain clinical trial costs are expensed immediately, while others are expensed over time based on the expected total number of patients in the trial, the rate at which patients enter and remain in the trial, and/or the period over which clinical investigators, contract research organizations ("CROs"), or other third-party service providers are expected to provide services. In the event of early termination of a clinical trial, the Company accrues and recognizes expenses in an amount based on its estimate of the remaining noncancelable obligations associated with the winding-down of the clinical trial, including any applicable penalties. Stock-based Compensation The Company recognizes stock-based compensation expense for equity grants under the Company's long-term incentive plans (including stock options, restricted stock awards, and restricted stock units (both time-based and performance-based)) to employees and non-employee members of the Company's board of directors (as applicable) based on the grant-date fair value of those awards. The grant-date fair value of an award is generally recognized as compensation expense over the award's requisite service period. Stock-based compensation expense also includes an estimate, which is made at the time of grant, of the number of awards that are expected to be forfeited. This estimate is revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates. In addition, the Company reassesses its forfeiture rate assumptions at least annually, considering both historical forfeiture experience and an estimate of future forfeitures for currently outstanding unvested awards. The Company uses the Black-Scholes model to compute the estimated fair value of stock option awards. Additionally, the Company uses a Monte Carlo simulation to compute the estimated fair value of performance-based restricted stock units that are subject to vesting based on the Company’s attainment of pre-established criteria that include a market condition. For performance-based restricted stock units that contain a performance condition, the Company recognizes stock-based compensation expense if and when the Company determines that it is probable the performance condition will be achieved (based on the number of shares expected to be vested and issued). The Company reassesses the probability of achievement at each reporting period and adjusts compensation cost, as necessary. If there are any changes in the Company's probability assessment, the Company recognizes a cumulative catch-up adjustment in the period of the change in estimate, with the remaining unrecognized expense recognized prospectively over the remaining requisite service period. If the Company subsequently determines that the performance criteria are not met or are not expected to be met, any amounts previously recognized as compensation expense are reversed in the period when such determination is made. Income Taxes The provision for income taxes includes U.S. federal, state, local, and foreign taxes. Income taxes are accounted for under the liability method. Deferred tax assets and liabilities are recognized for the expected future tax consequences of events that have been included in the financial statements or tax returns, including deferred tax assets and liabilities for expected amounts of global intangible low-taxed income ("GILTI") inclusions. Deferred tax assets and liabilities are determined as the difference between the tax basis of assets and liabilities and their respective financial reporting amounts ("temporary differences") at enacted tax rates in effect for the years in which the differences are expected to reverse. A valuation allowance is established for deferred tax assets for which it is more likely than not that some portion or all of the deferred tax assets will not be realized. The Company recognizes the financial statement effects of a tax position when management's assessment is that there is more than a 50% probability that the position will be sustained upon examination by a taxing authority based upon its technical merits. Uncertain tax positions are recorded based upon certain recognition and measurement criteria. The Company re-evaluates uncertain tax positions and considers various factors, including, but not limited to, changes in tax law, the measurement of tax positions taken or expected to be taken in tax returns, the effective settlement of matters subject to audit, information obtained during in-process audit activities, and changes in facts or circumstances related to a tax position. The Company adjusts the amount of the liability to reflect any subsequent changes in the relevant facts and circumstances surrounding the uncertain tax positions. The Company recognizes interest and penalties related to income tax matters in income tax expense. F-14 Table of Contents Per Share Data Basic net income per share is computed by dividing net income by the weighted average number of shares of Common Stock and Class A Stock outstanding. Net income per share is presented on a combined basis, inclusive of Common Stock and Class A Stock outstanding, as each class of stock has equivalent economic rights. Basic net income per share excludes restricted stock until vested. Diluted net income per share includes the potential dilutive effect of common stock equivalents as if such securities were converted or exercised during the period, when the effect is dilutive. Common stock equivalents include outstanding stock options and unvested restricted stock under the Company's long-term incentive plans, which are included under the treasury stock method when dilutive. Recently Issued Accounting Standards In November 2023, the FASB issued Accounting Standards Update No. 2023-07, Segment Reporting - Improvements to Reportable Segment Disclosures . The amendments require disclosure of incremental segment information on an annual and interim basis. The amendments also require companies with a single reportable segment to provide all disclosures required by this amendment and all existing segment disclosures in Accounting Standards Codification 280, Segment Reporting . The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods beginning after December 15, 2024. The Company does not expect the adoption of the amendments to have a significant impact on its financial statements. In December 2023, the FASB issued Accounting Standards Update No. 2023-09, Income Taxes - Improvements to Income Tax Disclosures . The amendments require (i) enhanced disclosures in connection with an entity's effective tax rate reconciliation and (ii) income taxes paid disaggregated by jurisdiction. The amendments are effective for annual periods beginning after December 15, 2024. The Company does not expect the adoption of the amendments to have a significant impact on its financial statements. 2. Product Sales Net product sales consist of the following: Year Ended December 31, (In millions) 2023 2022 2021 EYLEA ® HD U.S. $ 165.8 $ — $ — EYLEA ® U.S. 5,719.6 6,264.6 5,792.3 Total EYLEA HD and EYLEA U.S. 5,885.4 6,264.6 5,792.3 Libtayo ®(a) U.S. 538.8 374.5 306.3 Libtayo (a) ROW (b) 324.3 73.0 — Total Libtayo Global 863.1 447.5 306.3 Praluent ® U.S. 182.4 130.0 170.0 REGEN-COV ®(c) U.S. — — 5,828.0 Evkeeza ® U.S. 77.3 48.6 18.4 Inmazeb ® U.S. 69.8 3.0 — ARCALYST ®(d) U.S. — — 2.2 $ 7,078.0 $ 6,893.7 $ 12,117.2 (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. Effective July 1, 2022, the Company records global net product sales of Libtayo. See Note 3 for further details. (b) Rest of world ("ROW") (c) Net product sales of REGEN-COV in the United States relate to product sold in connection with the Company's agreements with the U.S. government. See Note 3 for further details. (d) Effective April 1, 2021, Kiniksa records net product sales of ARCALYST in the United States. Previously, the Company recorded net product sales of ARCALYST in the United States. As of December 31, 2023 and 2022, the Company had $ 3.888 billion and $ 3.586 billion, respectively, of trade accounts receivable that were recorded within Accounts receivable, net. F-15 Table of Contents The Company had product sales to certain customers that accounted for more than 10% of total gross product revenue for each of the years ended December 31, 2023, 2022, and 2021. Sales to each of these customers as a percentage of the Company's total gross product revenue are as follows: Year Ended December 31, 2023 2022 2021 Besse Medical, a subsidiary of Cencora, Inc. 51 % 55 % 30 % McKesson Corporation 25 % 28 % 18 % U.S. government * * 43 % * Sales to the U.S. government represented less than 10% of total gross product revenue during the period. Revenue from product sales is recorded net of applicable provisions for rebates, chargebacks, and discounts, distribution-related fees, and other sales-related deductions. Accruals for chargebacks and discounts are recorded as a direct reduction to accounts receivable. Accruals for rebates, distribution-related fees, and other sales-related deductions are recorded within accrued liabilities. The following table summarizes the provisions, and credits/payments, for sales-related deductions. (In millions) Rebates, Chargebacks, and Discounts Distribution- Related Fees Other Sales- Related Deductions Total Balance as of December 31, 2020 $ 202.2 $ 77.2 $ 44.8 $ 324.2 Provisions 1,047.1 363.6 150.4 1,561.1 Credits/payments ( 1,034.7 ) ( 360.8 ) ( 127.6 ) ( 1,523.1 ) Balance as of December 31, 2021 214.6 80.0 67.6 362.2 Provisions 1,537.3 431.1 141.1 2,109.5 Credits/payments ( 1,398.0 ) ( 399.7 ) ( 127.2 ) ( 1,924.9 ) Balance as of December 31, 2022 353.9 111.4 81.5 546.8 Provisions 2,074.5 439.2 155.3 2,669.0 Credits/payments ( 1,972.7 ) ( 388.3 ) ( 157.5 ) ( 2,518.5 ) Balance as of December 31, 2023 $ 455.7 $ 162.3 $ 79.3 $ 697.3 F-16 Table of Contents 3. Collaboration, License, and Other Agreements a. Sanofi Amounts recognized in the Company's Statements of Operations in connection with its collaborations with Sanofi are detailed below: Statement of Operations Classification Year Ended December 31, (In millions) 2023 2022 2021 Antibody: Regeneron's share of profits in connection with commercialization of antibodies Collaboration revenue $ 3,136.5 $ 2,082.0 * $ 1,363.0 Sales-based milestones earned Collaboration revenue $ 50.0 $ 100.0 $ 50.0 Reimbursement for manufacturing of commercial supplies Collaboration revenue $ 613.0 $ 633.7 $ 488.8 Other Collaboration revenue $ — $ 28.7 $ — Regeneron's obligation for its share of Sanofi R&D expenses, net of reimbursement of R&D expenses (R&D expense)/Reduction of R&D expense $ ( 83.7 ) $ 43.0 $ 129.2 Reimbursement of commercialization-related expenses Reduction of SG&A expense $ 534.4 $ 437.4 $ 320.5 Immuno-oncology (a) : Regeneron's share of profits (losses) in connection with commercialization of Libtayo outside the United States Collaboration revenue $ — $ 6.7 $ ( 13.6 ) Reimbursement for manufacturing of ex-U.S. commercial supplies Collaboration revenue $ — $ 4.6 $ 14.0 Reimbursement of R&D expenses Reduction of R&D expense $ — $ 42.7 $ 85.1 Reimbursement of commercialization-related expenses Reduction of SG&A expense $ — $ 41.4 $ 89.6 Regeneron's obligation for its share of Sanofi commercial expenses SG&A expense $ — $ ( 19.9 ) $ ( 36.3 ) Regeneron's obligation for Sanofi's share of Libtayo U.S. gross profits Cost of goods sold $ — $ ( 70.1 ) $ ( 133.0 ) Amounts recognized in connection with up-front payments received Other operating income $ — $ 35.1 $ 6.1 * Net of one-time payment of $ 56.9 million to Sanofi in connection with the amendment to the Antibody License and Collaboration Agreement (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. Antibody The Company is party to a global, strategic collaboration with Sanofi to research, develop, and commercialize fully human monoclonal antibodies (the "Antibody Collaboration"), which currently consists of Dupixent ® (dupilumab), Kevzara ® (sarilumab), and itepekimab . Under the terms of the Antibody License and Collaboration Agreement (the "LCA"), Sanofi is generally responsible for funding 80 % to 100 % of agreed-upon development costs. The Company is obligated to reimburse Sanofi for 30 % to 50 % of worldwide development expenses that were funded by Sanofi based on the Company's share of collaboration profits from commercialization of collaboration products. Under the terms of the LCA, the Company was required to apply 10 % of its share of the profits from the Antibody Collaboration in any calendar quarter to reimburse Sanofi for these development costs. On July 1, 2022, an amendment to the LCA became effective, pursuant to which the percentage of the Company's share of profits used to reimburse Sanofi for such development costs increased from 10 % to 20 %. A portion of the value associated with the increase in reimbursement percentage was deemed to be contingent consideration attributable to the Company's acquisition of the Libtayo (cemiplimab) rights described within the " Immuno-Oncology " section below; this portion is recorded as an increase to the Libtayo intangible asset over time as the Company repays such development costs to Sanofi. The Company's contingent reimbursement obligation to Sanofi under the Antibody Collaboration was approximately $ 2.330 billion as of December 31, 2023. F-17 Table of Contents Sanofi leads commercialization activities for products under the Antibody Collaboration, subject to the Company's right to co-commercialize such products. The Company co-commercializes Dupixent in the United States and in certain countries outside the United States. The parties equally share profits from sales within the United States. The parties share profits outside the United States on a sliding scale based on sales starting at 65 % (Sanofi)/ 35 % (Regeneron) and ending at 55 % (Sanofi)/ 45 % (Regeneron). In addition to profit sharing, the Company was entitled to receive sales milestone payments from Sanofi. In 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, which was previously included in the LCA) exceeding $ 3.0 billion on a rolling twelve-month basis. In 2022, the Company earned two $ 50.0 million sales-based milestones from Sanofi, upon aggregate annual sales of antibodies outside the United States (including Praluent) exceeding $ 2.0 billion and $ 2.5 billion, respectively, on a rolling twelve-month basis. In 2021, 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 $ 1.5 billion, on a rolling twelve-month basis. The Company's significant promised goods and services in connection with the Antibody Collaboration consist of providing research and development services, including the manufacturing of clinical supplies, and providing commercial-related services, including the manufacturing of commercial supplies. The Company recognizes amounts in connection with the Antibody Collaboration based on the amount it has the right to invoice and such amount corresponds directly with the Company's performance to date. The following table summarizes contract balances in connection with the Company's Antibody Collaboration with Sanofi: As of December 31, (In millions) 2023 2022 Accounts receivable, net $ 1,029.1 $ 692.3 Deferred revenue $ 427.7 $ 415.8 Immuno-Oncology The Company was previously a party to a collaboration with Sanofi for antibody-based cancer treatments in the field of immuno-oncology (the "IO Collaboration"). The IO Collaboration was governed by an Amended and Restated Immuno-oncology Discovery and Development Agreement ("Amended IO Discovery Agreement"), and an Immuno-oncology License and Collaboration Agreement ("IO License and Collaboration Agreement"). In connection with the execution of the original Immuno-oncology Discovery and Development Agreement in 2015 ("2015 IO Discovery Agreement"), which was subsequently replaced by the Amended IO Discovery Agreement (as discussed below), Sanofi made a $ 265.0 million non-refundable up-front payment to the Company. Pursuant to the 2015 IO Discovery Agreement, the Company was to identify and validate potential immuno-oncology targets and develop therapeutic antibodies against such targets through clinical proof-of-concept. Effective December 31, 2018, the Company and Sanofi entered into the Amended IO Discovery Agreement, which narrowed the scope of the existing discovery and development activities conducted by the Company under the 2015 IO Discovery Agreement to developing therapeutic bispecific antibodies targeting (i) BCMA and CD3 and (ii) MUC16 and CD3 through clinical proof-of-concept. During 2021, Sanofi did not exercise its options to license rights to these product candidates; as a result, the Company retains the exclusive right to develop and commercialize such product candidates and Sanofi will receive a royalty on sales (if any). In addition, the Company has no further obligations to develop drug product candidates under the Amended IO Discovery Agreement. In connection with the execution of the IO License and Collaboration Agreement in 2015, Sanofi made a $ 375.0 million non-refundable up-front payment to the Company. Under the terms of the IO License and Collaboration Agreement, the parties were co-developing and co-commercializing Libtayo. The parties shared equally, on an ongoing basis, development and commercialization expenses for Libtayo. The Company had principal control over the development of Libtayo and led commercialization activities in the United States, while Sanofi led commercialization activities outside the United States. The parties shared equally in profits and losses in connection with the commercialization of Libtayo. Recognition of the up-front payments received from Sanofi had been deferred (recorded within Other liabilities), and such amounts were being recognized over the remaining period in which the Company was obligated to perform development activities. During 2021, the Company updated its estimate of the total research and development costs expected to be incurred (which resulted in a change to the estimate of the stage of completion) in connection with the IO Collaboration, and, as a result, recorded a cumulative catch-up adjustment of $ 66.9 million as a reduction to other operating income. F-18 Table of Contents In connection with the Amended and Restated Immuno-oncology License and Collaboration Agreement with Sanofi (the "A&R IO LCA") described below, the remaining IO Collaboration Other liabilities balance of $ 241.0 million as of July 1, 2022 was recognized as a reduction to the intangible asset recorded in connection with the transaction during 2022. Effective July 1, 2022, the Company obtained the exclusive right to develop, commercialize, and manufacture Libtayo worldwide under the A&R IO LCA. 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 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. The transaction was accounted for as an asset acquisition and amounts paid to Sanofi in connection with obtaining the worldwide rights to Libtayo, including the up-front payment and any contingent consideration, are recorded as an intangible asset. See Note 8 for additional information related to the intangible asset. In accordance with the Amended IO Discovery Agreement, the Company was obligated to reimburse Sanofi for half of the development costs it funded that were attributable to clinical development of product candidates from the Company's share of profits from commercialized IO Collaboration products. Under the A&R IO LCA, the amount of development costs incurred under the IO Collaboration for which the Company was obligated to reimburse Sanofi was $ 35.0 million as of the effective date of the A&R IO LCA, and the Company pays Sanofi a 0.5 % royalty on net product sales of Libtayo until all such development costs have been reimbursed by Regeneron. The Company's contingent reimbursement obligation to Sanofi under the A&R IO LCA was approximately $ 28 million as of December 31, 2023. b. Bayer The Company is party to a license and collaboration agreement with Bayer for the global development and commercialization of EYLEA 8 mg (aflibercept 8 mg) and EYLEA (aflibercept) outside the United States. Agreed-upon development expenses incurred by the Company and Bayer are generally shared equally. The Company is also obligated to use commercially reasonable efforts to supply clinical and commercial bulk product. Within the United States, the Company is responsible for commercialization and retains profits from such sales. Bayer is responsible for commercialization activities outside the United States, and the companies share equally in profits from such sales. In Japan, the Company was entitled to receive a tiered percentage of between 33.5 % and 40.0 % of EYLEA net product sales through 2021, and effective January 1, 2022, the companies share equally in profits from sales in Japan. The Company is obligated to reimburse Bayer out of its share of the collaboration profits for 50 % of the agreed-upon development expenses that Bayer has incurred in accordance with a formula based on the amount of development expenses that Bayer has incurred and the Company's share of the collaboration profits, or at a faster rate at the Company's option. The Company's contingent reimbursement obligation to Bayer was approximately $ 293 million as of December 31, 2023. Amounts recognized in the Company's Statements of Operations in connection with its Bayer collaboration are as follows: Statement of Operations Classification Year Ended December 31, (In millions) 2023 2022 2021 Regeneron's share of profits in connection with commercialization of EYLEA outside the United States Collaboration revenue $ 1,376.4 $ 1,317.4 $ 1,349.2 Reimbursement for manufacturing of ex-U.S. commercial supplies Collaboration revenue $ 111.1 $ 91.4 $ 60.1 One-time payment in connection with change in Japan arrangement Collaboration revenue $ — $ 21.9 $ — Regeneron's obligation for its share of Bayer R&D expenses, net of reimbursement of R&D expenses (R&D expense)/Reduction of R&D expense $ ( 44.0 ) $ 16.7 $ 5.2 F-19 Table of Contents The following table summarizes contract balances in connection with the Company's Bayer collaboration: As of December 31, (In millions) 2023 2022 Accounts receivable, net $ 381.7 $ 348.2 Deferred revenue $ 138.2 $ 131.9 c. Alnylam 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. 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 (under which the parties are advancing ALN-APP and ALN-PNP, which are currently in clinical development) or a license agreement. The initial target nomination and discovery period is five years (which may under certain situations automatically be extended for up to seven years in the aggregate) (the "Research Term"). In addition, the Company has the option to extend the Research Term for an additional five-year period for a research extension fee of $ 300.0 million. During 2023, the Company paid a $ 100.0 million development milestone to Alnylam, 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 Year Ended December 31, (In millions) 2023 2022 2021 Regeneron's obligation for its share of Alnylam R&D expenses, net of reimbursement of R&D expenses (R&D expense) $ ( 74.1 ) $ ( 55.8 ) $ ( 60.5 ) Development milestone Acquired in-process research and development $ ( 100.0 ) $ — $ — The following table summarizes contract balances in connection with the Company's Alnylam collaboration: As of December 31, (In millions) 2023 2022 Accrued expenses and other current liabilities $ 22.6 $ 7.4 d. Roche The Company is a party to a collaboration agreement with Roche to develop, manufacture, and distribute the casirivimab and imdevimab antibody cocktail (known as REGEN-COV in the United States and Ronapreve ™ in other countries). Under the terms of the collaboration agreement, the parties jointly fund certain studies, and the Company has the right to distribute the product in the United States while Roche has the right to distribute the product outside the United States. The parties share gross profits from worldwide sales based on a pre-specified formula, depending on the amount of manufactured product supplied by each party to the market. F-20 Table of Contents Amounts recognized in the Company's Statements of Operations in connection with its Roche collaboration are as follows: Statement of Operations Classification Year Ended December 31, (In millions) 2023 2022 2021 Global gross profit payment from Roche in connection with sales of REGEN-COV and Ronapreve Collaboration revenue $ 224.3 $ 627.3 $ 361.8 Other Collaboration revenue $ ( 13.3 ) $ — $ — Reimbursement of R&D expenses (R&D expense)/Reduction of R&D expense $ ( 1.5 ) $ 6.8 $ 128.1 Global gross profit payment to Roche in connection with sales of REGEN-COV and Ronapreve Cost of goods sold $ — $ — $ 259.6 The following table summarizes contract balances in connection with the Company's Roche collaboration: As of December 31, (In millions) 2023 2022 Accounts receivable, net $ — $ 396.6 e. Intellia In 2016, the Company entered into a license and collaboration agreement with Intellia Therapeutics, Inc. to advance CRISPR/Cas9 gene-editing technology for in vivo therapeutic development. The parties collaborate to conduct research for the discovery, development, and commercialization of new therapies, in addition to the research and technology development of the CRISPR/Cas9 platform. Under the terms of the 2016 agreement, the parties agreed to a target selection process, whereby the Company may obtain exclusive rights in up to 10 targets to be chosen by the Company during the collaboration term, subject to various adjustments and limitations set forth in the agreement. Certain targets that either the Company or Intellia selects may be subject to a co-development and co-commercialization arrangement at the Company's option or Intellia’s option, as applicable. NTLA-2001, which is in clinical development, is subject to a co-development and co-commercialization arrangement pursuant to which Intellia will lead development and commercialization activities and the parties share an agreed-upon percentage of development expenses and profits (if commercialized). In 2020, the Company expanded its existing collaboration with Intellia to provide the Company with rights to develop products for additional in vivo CRISPR/Cas9-based therapeutic targets and for the parties to jointly develop potential products for the treatment of hemophilia A and B, with Regeneron leading development and commercialization activities. In addition, the Company also received non-exclusive rights to independently develop and commercialize ex vivo gene edited products. In connection with the agreement, in 2020, the Company made a $ 70.0 million up-front payment. In September 2023, the Company further expanded its existing collaboration to develop additional in vivo CRISPR-based gene editing therapies focused on neurological and muscular diseases. Intellia will lead the design of the editing methodology, the Company will lead the design of the targeted viral vector delivery approach, and the parties share costs equally. Each company will have the opportunity to lead potential development and commercialization of product candidates for one target, and the company that is not leading development and commercialization will have the option to enter into a co-development and co-commercialization agreement for the target. In October 2023, the Company elected to extend the period for selecting targets under the 2016 license and collaboration agreement for an additional two years until April 2026; as a result, the Company became obligated to make a $ 30.0 million extension payment to Intellia (which was recorded to Acquired in-process research and development expense in 2023). Amounts recognized in the Company's Statements of Operations in connection with research and development activities co-funded under the Intellia agreements were not material for the years ended December 31, 2023, 2022, and 2021. In addition, contract balances in the Company's Balance Sheets in connection with the Intellia agreements were not material as of December 31, 2023 and 2022. F-21 Table of Contents f. Sonoma In March 2023, the Company and Sonoma Biotherapeutics, Inc. entered into a license and collaboration agreement to bring together the Company's VelociSuite ® technologies with Sonoma's technology platform for the discovery, development, and commercialization of novel regulatory T cell ("Treg") therapies for autoimmune diseases. In connection with the agreement, the Company made a $ 45.0 million up-front payment (which was recorded to Acquired in-process research and development expense in 2023) and, in April 2023, the Company purchased an aggregate of $ 30.0 million of Sonoma preferred stock. Sonoma is also eligible to receive a $ 45.0 million development milestone payment. The Company and Sonoma will co-fund research and development activities and share equally any future commercial expenses and profits. 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. Amounts recognized in the Company's Statements of Operations in connection with research and development activities co-funded under the Sonoma agreement were not material for the year ended December 31, 2023. In addition, contract balances in the Company's Balance Sheets in connection with the Sonoma agreement were not material as of December 31, 2023. g. U.S. Government In 2021, the Company entered into agreements with the U.S. Department of Defense and the U.S. Department of Health and Human Services ("HHS") to manufacture and deliver filled and finished drug product of REGEN-COV to the U.S. government. Roche supplied a portion of the doses to Regeneron to fulfill the Company's agreement with the U.S. government (see "Roche" above for further details regarding the Company's collaboration agreement with Roche). As of December 31, 2021, the Company had completed its final deliveries of drug product under these agreements. See Note 2 for REGEN-COV net product sales recognized during the year ended December 31, 2021 in connection with these agreements. In August 2023, the Company expanded its Other Transaction Agreement ("OTA") with the Biomedical Advanced Research and Development Authority ("BARDA"), pursuant to which the 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. Pursuant to the terms of the expanded agreement, the Company could receive payments 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 the expanded BARDA agreement were $ 50.4 million for the year ended December 31, 2023. The following table summarizes the Company's contract balances in connection with this BARDA agreement: As of December 31, (In millions) 2023 Accounts receivable, net $ 18.5 h. Decibel 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 (which was accounted for as a business combination). 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 5). 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. F-22 Table of Contents 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 58.1 Indefinite-lived intangible asset related to in-process research and development 42.5 Goodwill 5.2 Other assets and liabilities, net ( 11.4 ) $ 148.7 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. i. Checkmate In 2022, the Company completed its acquisition of Checkmate Pharmaceuticals, Inc. 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 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. j. Other In addition to the collaboration agreements discussed above, the Company has various other license and collaboration agreements that are not individually significant to its operating results or financial condition at this time. Pursuant to the terms of those agreements, the Company may be required to pay, or it may receive, additional amounts contingent upon the occurrence of various future events (e.g., upon the achievement of various development and commercial milestones) which in the aggregate could be significant. The Company may also incur, or get reimbursed for, significant research and development costs. The Company has also in-licensed patent and/or technology pursuant to agreements which contain provisions that require the Company to pay royalties, as defined, at rates that range from 0.5 % to 12.0 %, in the event the Company sells or licenses any proprietary products developed under the respective agreements. As described above, as a result of obtaining worldwide rights to Libtayo, the Company pays Sanofi a royalty on net product sales of Libtayo. In addition, in 2018, the Company and Sanofi entered into a license agreement with Bristol-Myers Squibb Company, E. R. Squibb & Sons, L.L.C., and Ono Pharmaceutical Co., Ltd. to obtain a license under certain patents owned and/or exclusively licensed by one or more of those parties that includes the right to develop and sell Libtayo. Under the agreement, the Company paid royalties of 8.0 % on worldwide sales of Libtayo through December 31, 2023, and is obligated to pay royalties of 2.5 % from January 1, 2024 through December 31, 2026. Prior to July 1, 2022, royalties on such sales were shared equally by the Company and Sanofi. For the years ended December 31, 2023, 2022, and 2021, the Company recorded royalty expense (net of reimbursements from collaborators, as applicable) in its Statements of Operations of $ 117.6 million, $ 84.5 million, and $ 66.9 million, respectively, based on product sales under various licensing agreements. F-23 Table of Contents 4. Marketable Securities Marketable securities as of December 31, 2023 and 2022 consist of both available-for-sale debt securities of investment grade issuers (see below and Note 5) as well as equity securities of publicly traded companies (see Note 5). The following tables summarize the Company's investments in available-for-sale debt securities: (In millions) Amortized Unrealized Fair As of December 31, 2023 Cost Basis Gains Losses Value Corporate bonds $ 6,492.5 $ 10.4 $ ( 104.9 ) $ 6,398.0 U.S. government and government agency obligations 4,839.6 2.4 ( 8.6 ) 4,833.4 Sovereign bonds 58.1 — ( 0.9 ) 57.2 Commercial paper 636.8 0.2 ( 0.2 ) 636.8 Certificates of deposit 520.8 0.6 — 521.4 Asset-backed securities 88.2 0.1 ( 1.2 ) 87.1 $ 12,636.0 $ 13.7 $ ( 115.8 ) $ 12,533.9 As of December 31, 2022 Corporate bonds $ 6,975.5 $ — $ ( 291.1 ) $ 6,684.4 U.S. government and government agency obligations 2,945.4 0.9 ( 6.9 ) 2,939.4 Sovereign bonds 67.1 — ( 3.0 ) 64.1 Commercial paper 121.1 — — 121.1 Certificates of deposit 182.1 — ( 0.1 ) 182.0 Asset-backed securities 28.9 — ( 1.7 ) 27.2 $ 10,320.1 $ 0.9 $ ( 302.8 ) $ 10,018.2 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 December 31, 2023 mature at various dates through April 2029. The fair values of available-for-sale debt securities by contractual maturity consist of the following: As of December 31, (In millions) 2023 2022 Maturities within one year $ 8,114.8 $ 4,636.4 Maturities after one year through five years 4,414.5 5,381.4 Maturities after five years 4.6 0.4 $ 12,533.9 $ 10,018.2 The following table shows the fair value of the Company's available-for-sale debt securities that have unrealized losses, aggregated by investment category and length of time that the individual securities have been in a continuous loss position. F-24 Table of Contents Less than 12 Months 12 Months or Greater Total (In millions) As of December 31, 2023 Fair Value Unrealized Loss Fair Value Unrealized Loss Fair Value Unrealized Loss Corporate bonds $ 2,363.3 $ ( 2.4 ) $ 4,034.7 $ ( 102.5 ) $ 6,398.0 $ ( 104.9 ) U.S. government and government agency obligations 4,780.6 ( 6.0 ) 52.7 ( 2.6 ) 4,833.3 ( 8.6 ) Sovereign bonds 12.4 ( 0.1 ) 44.8 ( 0.8 ) 57.2 ( 0.9 ) Commercial paper 636.8 ( 0.2 ) — — 636.8 ( 0.2 ) Asset-backed securities 61.8 ( 0.3 ) 25.3 ( 0.9 ) 87.1 ( 1.2 ) $ 7,854.9 $ ( 9.0 ) $ 4,157.5 $ ( 106.8 ) $ 12,012.4 $ ( 115.8 ) As of December 31, 2022 Corporate bonds $ 2,445.4 $ ( 73.1 ) $ 4,200.4 $ ( 218.0 ) $ 6,645.8 $ ( 291.1 ) U.S. government and government agency obligations 785.2 ( 2.0 ) 71.0 ( 4.9 ) 856.2 ( 6.9 ) Sovereign bonds 18.6 ( 1.1 ) 45.6 ( 1.9 ) 64.2 ( 3.0 ) Certificates of deposit 40.2 ( 0.1 ) — — 40.2 ( 0.1 ) Asset-backed securities 11.5 ( 0.6 ) 15.2 ( 1.1 ) 26.7 ( 1.7 ) $ 3,300.9 $ ( 76.9 ) $ 4,332.2 $ ( 225.9 ) $ 7,633.1 $ ( 302.8 ) The unrealized losses on corporate bonds as of December 31, 2023 and 2022 were primarily driven by increased 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 years ended December 31, 2023, 2022, and 2021, 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. Realized gains and losses on sales of marketable securities were not material for the years ended December 31, 2023, 2022, and 2021. The Company recognized interest income of $ 495.9 million, $ 160.1 million, and $ 45.8 million for the years ended December 31, 2023, 2022, and 2021, respectively, in Other income (expense), net. F-25 Table of Contents 5. Fair Value Measurements 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 • Level 3 - Significant other unobservable inputs (In millions) Fair Value Measurements at Reporting Date As of December 31, 2023 Fair Value Level 1 Level 2 Level 3 Assets: Cash equivalents $ 928.1 $ 6.4 $ 921.7 $ — Available-for-sale debt securities: Corporate bonds 6,398.0 — 6,398.0 — U.S. government and government agency obligations 4,833.4 — 4,833.4 — Sovereign bonds 57.2 — 57.2 — Commercial paper 636.8 — 636.8 — Certificates of deposit 521.4 — 521.4 — Asset-backed securities 87.1 — 87.1 — Equity securities (unrestricted) 864.5 864.5 — — Equity securities (restricted) 112.9 112.9 — — Total assets $ 14,439.4 $ 983.8 $ 13,455.6 $ — Liabilities: Contingent consideration - CVRs $ 43.7 $ — $ — $ 43.7 As of December 31, 2022 Assets: Cash equivalents $ 1,662.8 $ 88.3 $ 1,574.5 $ — Available-for-sale debt securities: Corporate bonds 6,684.4 — 6,684.4 — U.S. government and government agency obligations 2,939.4 — 2,939.4 — Sovereign bonds 64.1 — 64.1 — Commercial paper 121.1 — 121.1 — Certificates of deposit 182.0 — 182.0 — Asset-backed securities 27.2 — 27.2 — Equity securities (unrestricted) 24.6 24.6 — — Equity securities (restricted) 1,185.4 1,185.4 — — Total assets $ 12,891.0 $ 1,298.3 $ 11,592.7 $ — The Company held certain restricted equity securities as of December 31, 2023 which are subject to transfer restrictions that expire at various dates throug h 2024 . During the years ended December 31, 2023 and 2022, the Company recorded $ 237.8 million and $ 39.8 million, respectively, of net unrealized losses on equity securities in Other income (expense), net. During the year ended December 31, 2021, the Company recorded $ 386.1 million of net unrealized gains on equity securities in Other income (expense), net. In addition, during the year ended December 31, 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. F-26 Table of Contents In addition to the investments summarized in the table above, as of December 31, 2023 and 2022, the Company had $ 74.3 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. 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. Through December 31, 2023, there were no changes in the fair value of the CVRs subsequent to the date of acquisition. The fair value of the Company's long-term debt (see Note 10), which was determined based on Level 2 inputs, was estimated to be $ 1.528 billion and $ 1.443 billion as of December 31, 2023 and 2022, respectively. 6. Inventories Inventories consist of the following: As of December 31, (In millions) 2023 2022 Raw materials $ 789.3 $ 818.4 Work-in-process 1,121.8 963.1 Finished goods 147.3 98.6 Deferred costs 522.1 521.8 $ 2,580.5 $ 2,401.9 Deferred costs represent the costs of product manufactured and shipped to the Company's collaborators for which recognition of revenue has been deferred. Inventory balances in the table above are net of reserves of $ 705.9 million and $ 720.7 million as of December 31, 2023 and 2022, respectively. For the years ended December 31, 2023, 2022, and 2021, Cost of goods sold included inventory write-offs and reserves of $ 102.3 million, $ 258.7 million, and $ 457.1 million, respectively. Inventory write-offs and reserves for the years ended 2022 and 2021 primarily related to REGEN-COV. 7. Property, Plant, and Equipment Property, plant, and equipment, net consists of the following: As of December 31, (In millions) 2023 2022 Building and improvements $ 2,423.1 $ 2,270.0 Leasehold improvements 133.9 114.3 Laboratory equipment 1,384.5 1,315.3 Computer equipment and software 389.7 337.4 Furniture, office equipment, and other 165.9 150.2 Land 283.1 264.5 Construction in progress 1,345.0 980.5 6,125.2 5,432.2 Accumulated depreciation and amortization ( 1,978.8 ) ( 1,669.2 ) $ 4,146.4 $ 3,763.0 Property, plant, and equipment in the table above includes leased property under the Company's finance lease at its Tarrytown, New York facility. See Note 11. Depreciation and amortization expense on property, plant, and equipment was $ 328.8 million, $ 303.9 million, and $ 281.1 million for the years ended December 31, 2023, 2022, and 2021, respectively. F-27 Table of Contents As of December 31, 2023 and 2022, $ 3.375 billion and $ 2.960 billion, respectively, of the Company's net property, plant, and equipment was located in the United States and $ 771.4 million and $ 803.0 million, respectively, was located outside the United States (primarily in Ireland). 8. Intangible Assets Intangible assets. net consist of the following: As of December 31, 2023 2022 (In millions) Estimated Useful Life Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross carrying Amount Accumulated Amortization Net Carrying Amount Acquired product rights - Libtayo 13 years $ 1,119.1 $ ( 126.7 ) $ 992.4 $ 946.3 $ ( 35.7 ) $ 910.6 Other intangibles 8 years 10.0 ( 6.3 ) 3.7 10.0 ( 5.1 ) 4.9 Acquired in-process research and development Indefinite 42.5 — 42.5 — — — $ 1,171.6 $ ( 133.0 ) $ 1,038.6 $ 956.3 $ ( 40.8 ) $ 915.5 As described in Note 3, during the year ended December 31, 2023, the Company recorded an indefinite-lived intangible asset of $ 42.5 million in connection with its acquisition of Decibel. During the year ended December 31, 2022, the Company recorded an intangible asset in connection with obtaining the exclusive right to develop, commercialize, and manufacture Libtayo worldwide. The intangible asset recognized upon the effective date of the A&R IO LCA primarily consisted of the $ 900.0 million up-front payment, offset by the remaining IO Collaboration other liabilities balance of $ 241.0 million. Additionally, during the years ended December 31, 2023 and 2022, the Company recorded additions to the Libtayo intangible asset related to contingent consideration (including regulatory and sales-based milestones) due to Sanofi. See Note 3. Amortization expense on intangible assets was $ 92.2 million and $ 37.6 million for the years ended December 31, 2023 and 2022, respectively. Amortization expense for the year ended December 31, 2021 was no t material. As of December 31, 2023, assuming no changes in the gross carrying amount of intangible assets, amortization expense is estimated to be approximately $ 85 million for each of the years ending December 31, 2024 through December 31, 2028. 9. Accrued Expenses and Other Current Liabilities Accrued expenses and other current liabilities consist of the following: As of December 31, (In millions) 2023 2022 Accrued payroll and related costs $ 618.2 $ 497.3 Accrued clinical expenses 292.2 295.0 Accrued sales-related costs 780.8 633.6 Other accrued expenses and liabilities 666.7 648.3 $ 2,357.9 $ 2,074.2 F-28 Table of Contents 10. Debt Credit Facility In December 2022, the Company entered into an agreement with a syndicate of lenders (the "2022 Credit Agreement") which provides for a $ 750.0 million senior unsecured five-year revolving credit facility (the "2022 Credit Facility") and replaced the Company's then-existing credit agreement, which was contemporaneously terminated. The 2022 Credit Agreement includes an option for the Company to elect to increase the commitments under the 2022 Credit Facility and/or to enter into one or more tranches of term loans in the aggregate principal amount of up to $ 500.0 million, subject to the consent of the lenders providing the additional commitments or term loans, as applicable, and certain other conditions. The 2022 Credit Agreement also provides a $ 50.0 million sublimit for letters of credit. Proceeds of the loans under the 2022 Credit Facility may be used to finance working capital needs, and for general corporate or other lawful purposes, of Regeneron and its subsidiaries. Regeneron Pharmaceuticals, Inc. has guaranteed all obligations under the 2022 Credit Facility. The 2022 Credit Agreement includes an option for the Company to elect to extend the maturity date of the 2022 Credit Facility beyond December 2027, subject to the consent of the extending lenders and certain other conditions. The Company had no borrowings outstanding under the 2022 Credit Facility as of December 31, 2023. The 2022 Credit Agreement contains operating covenants and a maximum total leverage ratio financial covenant. The Company was in compliance with all covenants of the 2022 Credit Agreement as of December 31, 2023. Senior Notes In 2020, the Company issued and sold $ 1.250 billion aggregate principal amount of senior unsecured notes due 2030 and $ 750 million aggregate principal amount of senior unsecured notes due 2050 (collectively, the "Notes"). The underwriting discounts and offering expenses are being amortized as additional interest expense over the period from issuance through maturity. Long-term debt in connection with the Notes, net of underwriting discounts and offering expenses, consists of the following: As of December 31, (In millions) 2023 2022 1.750 % Senior Notes due September 2030 $ 1,242.2 $ 1,241.0 2.800 % Senior Notes due September 2050 740.7 740.4 $ 1,982.9 $ 1,981.4 Interest on each series of Notes is payable semi-annually in arrears on March 15 and September 15 of each year until their respective maturity dates. Interest expense related to the Notes was $ 44.4 million in each of the years ended December 31, 2023, 2022, and 2021. The Notes may be redeemed at the Company’s option at any time at 100 % of the principal amount plus accrued and unpaid interest, and, until a specified period before maturity, a specified make-whole amount. The Notes contain a change-of-control provision that, under certain circumstances, may require the Company to offer to repurchase the Notes at a price equal to 101 % of the principal amount plus accrued and unpaid interest. The Notes also contain certain limitations on the Company's ability to incur liens and enter into sale and leaseback transactions, as well as customary events of default. 11. Leases The Company conducts certain of its research, development, and administrative activities at leased facilities. The Company also leases vehicles and other assets. Tarrytown, New York Lease The Company is party to a Third Amended and Restated Lease and Remedies Agreement (the "Third Amended and Restated Lease") with BA Leasing BSC, LLC, an affiliate of Banc of America Leasing & Capital, LLC ("BAL"), as lessor, which relates to the Company’s lease of laboratory and office facilities in Tarrytown, New York (the “Facility”); and a Third Amended and Restated Participation Agreement (the "Third Amended and Restated Participation Agreement") with Bank of America, N.A., as administrative agent (the "Administrative Agent"), and a syndicate of lenders (collectively with BAL, the "Participants"), as rent assignees. The Third Amended and Restated Lease and Third Amended and Restated Participation Agreement provide for a March 2027 maturity date of the $ 720.0 million lease financing (previously advanced by the Participants in March 2017 in connection with the acquisition by BAL of the Facility and the Company's lease of the Facility from BAL) and the end of the term F-29 Table of Contents of the Company's lease of the Facility from BAL, at which time all amounts outstanding thereunder will become due and payable in full. In accordance with the terms of the Third Amended and Restated Lease, the Company pays all maintenance, insurance, taxes, and other costs arising out of the use of the Facility. The Company is also required to make monthly payments of basic rent during the remaining term of the Third Amended and Restated Lease to satisfy the yield payable to the Participants on their outstanding advances under the Third Amended and Restated Participation Agreement. Such advances accrue yield at a variable rate per annum based on the one-month forward-looking Secured Overnight Financing Rate ("SOFR") term rate, plus a spread adjustment, plus an applicable margin that varies with the Company's debt rating and total leverage ratio. The Third Amended and Restated Participation Agreement and Third Amended and Restated Lease include an option for the Company to elect to further extend the maturity date of the Third Amended and Restated Participation Agreement and the term of the Third Amended and Restated Lease for an additional five-year period, subject to the consent of all the Participants and certain other conditions. The Company also has the option prior to the end of the term of the Third Amended and Restated Lease to (a) purchase the Facility by paying an amount equal to the outstanding principal amount of the Participants' advances under the Third Amended and Restated Participation Agreement, all accrued and unpaid yield thereon, and all other outstanding amounts under the Third Amended and Restated Participation Agreement, Third Amended and Restated Lease, and certain related documents or (b) sell the Facility to a third party on behalf of BAL. The Third Amended and Restated Lease is classified as a finance lease as the Company has the option to purchase the Facility under terms that make it reasonably certain to be exercised. The agreements governing the Third Amended and Restated Lease financing contain financial and operating covenants. Such financial covenants and certain of the operating covenants are substantially similar to the covenants set forth in the 2022 Credit Agreement. The Company was in compliance with all such covenants as of December 31, 2023. Aggregate Lease Information Amounts recognized in the Consolidated Balance Sheet related to the Company's leases are included in the table below. As of December 31, (In millions) Classification 2023 2022 Assets: Finance lease right-of-use assets Property, plant, and equipment, net (a) $ 605.7 $ 620.3 Operating lease right-of-use assets Other noncurrent assets (b) 78.0 71.2 $ 683.7 $ 691.5 Liabilities: Finance lease liabilities - noncurrent Finance lease liabilities $ 720.0 $ 720.0 Operating lease liabilities - current Accrued expenses and other current liabilities 19.0 12.4 Operating lease liabilities - noncurrent Other noncurrent liabilities 68.7 55.8 $ 807.7 $ 788.2 (a) Finance lease right-of-use assets were recorded net of accumulated amortization of $ 133.9 million and $ 119.4 million as of December 31, 2023 and 2022, respectively. (b) Operating lease right-of-use assets were recorded net of accumulated amortization of $ 44.6 million and $ 31.0 million as of December 31, 2023 and 2022, respectively. F-30 Table of Contents Lease costs consist of the following: Year Ended December 31, (In millions) 2023 2022 2021 Operating lease costs $ 19.2 $ 12.4 $ 10.3 Finance lease costs: Amortization of finance lease right-of-use assets 14.5 14.5 14.4 Interest on finance lease liabilities 45.0 21.6 11.9 Total finance lease costs 59.5 36.1 26.3 Total lease costs $ 78.7 $ 48.5 $ 36.6 Other information related to the Company's leases includes the following: As of December 31, 2023 2022 Weighted-average remaining lease term (in years): Finance leases 3.2 4.2 Operating leases 7.4 7.2 Weighted-average discount rate: Finance leases 5.08 % 4.84 % Operating leases 5.38 % 5.20 % Supplemental cash flow information related to the Company's leases includes the following: Year Ended December 31, (In millions) 2023 2022 2021 Cash paid for amounts included in the measurement of operating lease liabilities (included within cash flows from operating activities) $ 22.5 $ 7.7 $ 10.2 Right-of-use assets obtained in exchange for operating lease liabilities $ 31.9 $ 35.1 $ 0.2 The following is a maturity analysis of the Company's lease liabilities as of December 31, 2023: (In millions) Finance Leases Operating Leases Total 2024 $ 44.8 $ 24.1 $ 68.9 2025 39.5 20.1 59.6 2026 30.9 15.6 46.5 2027 728.4 12.4 740.8 2028 — 11.0 11.0 Thereafter — 20.1 20.1 Total undiscounted lease payments 843.6 103.3 946.9 Imputed interest ( 123.6 ) ( 15.6 ) ( 139.2 ) Total lease liabilities $ 720.0 $ 87.7 $ 807.7 F-31 Table of Contents 12. Stockholders' Equity The Company's Restated Certificate of Incorporation, as amended, provides for the issuance of up to 40 million shares of Class A Stock, par value $ 0.001 per share, and 320 million shares of Common Stock, par value $ 0.001 per share. Shares of Class A Stock are convertible, at any time, at the option of the holder into shares of Common Stock on a share-for-share basis. Holders of Class A Stock have rights and privileges identical to Common Stockholders except that each share of Class A is entitled to ten votes per share, while each share of Common Stock is entitled to one vote per share. Class A Stock may only be transferred to specified Permitted Transferees, as defined. Under the Company's Restated Certificate of Incorporation, the Company's board of directors is authorized to issue up to 30 million shares of Preferred Stock, in series, with rights, privileges, and qualifications of each series determined by the board of directors. Share Repurchase Programs In January 2021, the Company's board of directors authorized a share repurchase program to repurchase up to $ 1.5 billion of the Company's Common Stock. As of December 31, 2021, the Company had repurchased the entire $ 1.5 billion of its Common Stock that it was authorized to repurchase under the program. In November 2021, the Company's board of directors authorized a share repurchase program to repurchase up to $ 3.0 billion of the Company's Common Stock. As of June 30, 2023, the Company had repurchased the entire $ 3.0 billion of its Common Stock that it was authorized to repurchase under the program. In January 2023, the Company's board of directors authorized an additional share repurchase program to repurchase up to $ 3.0 billion of the Company's 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. 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. As of December 31, 2023, $ 1.531 billion remained available for share repurchases under the program. The table below summarizes the shares of the Company's Common Stock repurchased and the cost of the shares, which were recorded as Treasury Stock. Year Ended December 31, (In millions) 2023 2022 2021 Number of shares 2.9 3.3 3.0 Total cost of shares $ 2,214.6 $ 2,099.8 $ 1,655.0 13. Long-Term Incentive Plans The Company has used long-term incentive plans for the purpose of granting equity awards to employees of the Company, including officers, and non-employee members of the Company's board of directors (collectively, "Participants"). The Participants may receive awards as determined by a committee of independent members of the Company's board of directors or, to the extent authorized by such committee with respect to certain Participants, a duly authorized employee (collectively, the "Committee"). The incentive plan currently used by the Company is the Second Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (the "Second Amended and Restated 2014 Incentive Plan"). It was most recently adopted and approved by the Company's shareholders in 2020. As of the most recent shareholder approval date, the Second Amended and Restated 2014 Incentive Plan provided for the issuance of up to 22.3 million shares of Common Stock in respect of awards. In addition, upon expiration, forfeiture, surrender, exchange, cancellation, or termination of any award previously granted under the Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (the "Amended and Restated 2014 Incentive Plan"), the Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (the "Original 2014 Incentive Plan"), or the Second Amended and Restated 2000 Long-Term Incentive Plan (the "2000 Incentive Plan"), any shares subject to such award are added to the pool of shares available for grant under the Second Amended and Restated 2014 Incentive Plan. The awards that may be made under the Second Amended and Restated 2014 Incentive Plan include: (a) non-qualified stock options and incentive stock options, (b) restricted stock awards, (c) shares of phantom stock (also referred to as restricted stock units, which may be time- or performance-based), and (d) other awards. Any award granted may (but is not required to) be subject to vesting based on the attainment by the Company of performance goals pre-established by the Committee. F-32 Table of Contents Stock option awards grant Participants the right to purchase shares of Common Stock at prices determined by the Committee, with exercise prices that are equal to or greater than the average of the high and low market prices of the Company's Common Stock on the date of grant (the "Market Price"). Options vest over a period of time determined by the Committee, generally on a pro rata basis over a four-year period. The Committee also determines the expiration date of each option. The maximum term of options that have been awarded under the 2000 Incentive Plan, the Original 2014 Incentive Plan, the Amended and Restated 2014 Incentive Plan, and the Second Amended and Restated 2014 Incentive Plan (collectively, the "Incentive Plans") is ten years . Restricted stock awards grant Participants shares of restricted Common Stock or allow Participants to purchase such shares at a price determined by the Committee. Such shares are nontransferable for a period determined by the Committee ("vesting period"). Should employment terminate, as specified in the Incentive Plans, except as determined by the Committee in its discretion and subject to the applicable Incentive Plan documents, the ownership of any unvested restricted stock awards will be transferred to the Company. Phantom stock awards provide the Participant the right to receive Common Stock or an amount of cash based on the value of the Common Stock at a future date. The award is subject to such restrictions, if any, as the Committee may impose at the date of grant or thereafter, including a specified period of employment or the achievement of performance goals. Time-based restricted stock units and performance-based restricted stock units are each a type of phantom stock award permitted under the Second Amended and Restated 2014 Incentive Plan. The Incentive Plans contain provisions that allow for the Committee to provide for the immediate vesting of awards upon a change in control of the Company, as defined in the Incentive Plans. As of December 31, 2023, there were 14.6 million shares available for future grants under the Second Amended and Restated 2014 Incentive Plan. a. Stock Options The table below summarizes the activity related to stock option awards under the Company's Incentive Plans during 2023. Number of Shares (In millions) Weighted-Average Exercise Price Weighted-Average Remaining Contractual Term Intrinsic Value (In millions) Outstanding as of December 31, 2022 15.6 $ 481.62 2023: Granted 1.6 $ 835.91 Forfeited ( 0.2 ) $ 580.17 Exercised ( 2.8 ) $ 412.05 Outstanding as of December 31, 2023 14.2 $ 534.13 6.0 years $ 4,918.6 Vested and expected to vest as of December 31, 2023 13.8 $ 526.95 5.9 years $ 4,852.2 Exercisable as of December 31, 2023 9.6 $ 450.01 4.7 years $ 4,118.0 The Company satisfies stock option exercises with newly issued shares of the Company's Common Stock. The total intrinsic value of stock options exercised during 2023, 2022, and 2021 was $ 1.096 billion, $ 1.214 billion, and $ 1.707 billion, respectively. The intrinsic value represents the amount by which the market price of the underlying stock exceeds the exercise price of an option. F-33 Table of Contents The table below summarizes the weighted-average exercise prices and weighted-average grant-date fair values of options issued during the years ended December 31, 2023, 2022, and 2021. Number of Options Granted (In millions) Weighted-Average Exercise Price Weighted-Average Fair Value 2023: Exercise price equal to Market Price 1.6 $ 835.91 $ 264.37 2022: Exercise price equal to Market Price 2.0 $ 705.02 $ 220.88 2021: Exercise price equal to Market Price 2.3 $ 628.43 $ 174.20 For the years ended December 31, 2023, 2022, and 2021, the Company recognized $ 357.1 million, $ 341.9 million, and $ 328.7 million, respectively, of stock-based compensation expense related to stock option awards (net of amounts capitalized as inventory, which were not material for each of the three years). As of December 31, 2023, there was $ 589.6 million of stock-based compensation cost related to unvested stock options, net of estimated forfeitures, which had not yet been recognized. The Company expects to recognize this compensation cost over a weighted-average period of 1.8 years. Fair Value Assumptions: The following table summarizes the weighted average values of the assumptions used in computing the fair value of option grants during 2023, 2022, and 2021. 2023 2022 2021 Expected volatility 26 % 28 % 27 % Expected lives from grant date 5.1 years 5.2 years 5.5 years Expected dividend yield 0 % 0 % 0 % Risk-free interest rate 4.29 % 3.50 % 1.22 % Expected volatility has been estimated based on actual movements in the Company's stock price over the most recent historical periods equivalent to the options' expected lives. Expected lives are principally based on the Company's historical exercise experience with previously issued employee and board of directors' option grants. The expected dividend yield is zero as the Company has never paid dividends and does not currently have plans to do so. The risk-free interest rates are based on quoted U.S. Treasury rates for securities with maturities approximating the options' expected lives. b. Restricted Stock Awards and Time-Based Restricted Stock Units A summary of the Company's activity related to restricted stock awards and time-based restricted stock units (excluding performance-based restricted stock units, which are detailed further below) (collectively, "restricted stock") during 2023 is summarized below. Number of Shares/Units (In millions) Weighted-Average Grant Date Fair Value Unvested as of December 31, 2022 2.6 $ 571.19 2023: Granted 0.8 $ 838.11 Vested ( 1.0 ) $ 458.49 Forfeited ( 0.1 ) $ 585.23 Unvested as of December 31, 2023 2.3 $ 705.37 For the years ended December 31, 2023, 2022, and 2021, the Company recognized $ 475.9 million, $ 331.1 million, and $ 221.0 million, respectively, of stock-based compensation expense related to restricted stock (net of amounts capitalized as inventory, which were not material for each of the three years). As of December 31, 2023, there was $ 1.023 billion of stock-based F-34 Table of Contents compensation cost related to unvested restricted stock which had not yet been recognized. The Company expects to recognize this compensation cost over a weighted-average period of 2.2 years. c. Performance-based Restricted Stock Units Performance-based restricted stock units ("PSUs") have been granted to certain members of senior management of the Company. PSUs may be earned based upon the attainment of pre-established performance criteria, which may include a market and/or performance condition. Depending on the terms of the PSUs and the outcome of the pre-established performance criteria, a recipient may ultimately earn the target number of PSUs granted or a specified multiple thereof at the end of a 4 – 6 year vesting period, as applicable. The table below summarizes activity related to PSUs during 2023. The number of unvested PSUs represents the maximum number of units that are eligible to be earned. Number of Shares/Units (In millions) Weighted-Average Grant Date Fair Value Unvested as of December 31, 2022 1.5 $ 245.94 2023: Vested ( 0.1 ) $ 198.10 Unvested as of December 31, 2023 1.4 $ 247.91 For each of the years ended December 31, 2023, 2022, and 2021 the Company recognized $ 52.0 million of stock-based compensation expense related to PSUs. As of December 31, 2023, there was $ 104.1 million of stock-based compensation cost related to unvested PSUs which had not yet been recognized. The Company expects to recognize this compensation cost on a straight-line basis over a weighted average period of 2.3 years. Fair Value Assumptions: The following table summarizes the weighted average values of the assumptions used in computing the fair value of PSUs that were granted during 2022. The Company did not grant PSUs during 2023 and 2021. 2022 Expected volatility 32 % Expected dividend yield 0 % Risk-free interest rate 3.3 % 14. Employee Savings Plans The Company maintains the Regeneron Pharmaceuticals, Inc. 401(k) Savings Plan, as amended and restated (the "Savings Plan"). The terms of the Savings Plan allow U.S. employees (as defined by the Savings Plan) to contribute to the Savings Plan a percentage of their compensation. In addition, the Company may make discretionary contributions, as defined, to the accounts of participants under the Savings Plan. The Company also maintains additional employee savings plans outside the United States, which cover eligible employees. Expenses recognized by the Company related to contributions to such plans were $ 84.7 million, $ 67.6 million, and $ 55.5 million for the years ended December 31, 2023, 2022, and 2021, respectively. F-35 Table of Contents 15. Income Taxes The Company is subject to U.S. federal, state, and foreign income taxes. Components of income before income taxes consist of the following: Year Ended December 31, (In millions) 2023 2022 2021 United States $ ( 362.3 ) $ 839.9 $ 5,944.7 Foreign 4,561.6 4,018.9 3,381.1 $ 4,199.3 $ 4,858.8 $ 9,325.8 Components of income tax expense consist of the following: Year Ended December 31, (In millions) 2023 2022 2021 Current: Federal $ 667.9 $ 968.5 $ 1,429.8 State 7.7 7.4 6.2 Foreign 407.9 290.9 ( 38.4 ) Total current tax expense 1,083.5 1,266.8 1,397.6 Deferred: Federal ( 834.5 ) ( 797.7 ) ( 423.2 ) State ( 6.5 ) ( 2.7 ) ( 0.6 ) Foreign 3.2 54.0 276.7 Total deferred tax benefit ( 837.8 ) ( 746.4 ) ( 147.1 ) $ 245.7 $ 520.4 $ 1,250.5 A reconciliation of the U.S. statutory income tax rate to the Company's effective income tax rate is as follows: Year Ended December 31, 2023 2022 2021 U.S. federal statutory tax rate 21.0 % 21.0 % 21.0 % Taxation of non-U.S. operations ( 6.6 ) ( 5.5 ) ( 2.8 ) Stock-based compensation ( 4.6 ) ( 2.9 ) ( 2.4 ) Income tax credits ( 3.2 ) ( 2.0 ) ( 1.0 ) Foreign-derived intangible income deduction ( 0.3 ) ( 1.0 ) ( 1.4 ) Other permanent differences ( 0.4 ) 1.1 — Effective income tax rate 5.9 % 10.7 % 13.4 % F-36 Table of Contents Deferred income taxes reflect the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes. Significant components of the Company's deferred tax assets and liabilities are as follows: As of December 31, (In millions) 2023 2022 Deferred tax assets: Capitalized research and development expenses $ 1,728.2 $ 845.3 Deferred compensation 413.6 416.2 Accrued expenses 214.1 235.6 Fixed assets and intangible assets 154.8 227.6 Tax attribute carryforwards 88.7 41.3 Other 26.4 15.9 Total deferred tax assets 2,625.8 1,781.9 Deferred tax liabilities: Unrealized gains on investments ( 50.4 ) ( 58.2 ) Net deferred tax assets $ 2,575.4 $ 1,723.7 The Company's federal income tax returns for 2017 through 2022 remain open to examination by the IRS. The Company's 2017 and 2018 federal income tax returns are currently under audit by the IRS. In general, the Company's state income tax returns from 2018 to 2022 remain open to examination. The Company's income tax returns outside the United States remain open to examination from 2018 to 2022. The United States and many states generally have statutes of limitation ranging from 3 to 5 years; however, those statutes could be extended due to the Company's tax credit carryforward position. In general, tax authorities have the ability to review income tax returns in which the statute of limitation has previously expired to adjust the tax credits generated in those years. The following table reconciles the beginning and ending amounts of unrecognized tax benefits: (In millions) 2023 2022 2021 Balance as of January 1 $ 542.8 $ 410.9 $ 267.0 Gross increases related to current year tax positions 153.4 136.9 182.3 Gross increases (decreases) related to prior year tax positions 3.2 ( 5.0 ) 2.9 Gross decreases due to settlements and lapse of statutes of limitations ( 3.0 ) — ( 41.3 ) Balance as of December 31 $ 696.4 $ 542.8 $ 410.9 In 2023, 2022, and 2021, the increases in unrecognized tax benefits primarily related to the Company's calculation of certain tax credits and other items related to the Company's international operations. In 2021, the decrease in unrecognized tax benefits due to settlements and lapse of statutes of limitations was related to the closing of audits for the Company's federal income tax returns for 2015 and 2016. Interest expense related to unrecognized tax benefits was not material in 2023, 2022, and 2021. The Company does not believe that it is reasonably possible that the resolution of tax exposures within the next twelve months would have a material impact on the consolidated financial statements as of December 31, 2023. The amount of net unrecognized tax benefits that, if settled, would impact the effective tax rate is $ 442.5 million, $ 373.7 million, and $ 321.1 million as of December 31, 2023, 2022, and 2021, respectively. In August 2022, the Inflation Reduction Act of 2022 ("IRA") was signed into law in the United States. The IRA created a new corporate alternative minimum tax of 15% on adjusted financial statement income and an excise tax of 1% of the value of certain stock repurchases. 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 as of and for the periods ended December 31, 2023 and 2022. F-37 Table of Contents 16. Legal Matters From time to time, the Company is a party to legal proceedings in the course of the Company's business. The outcome of any such proceedings, regardless of the merits, is inherently uncertain. If the Company were unable to prevail in any such proceedings, its consolidated financial position, results of operations, and future cash flows may be materially impacted. Costs associated with the Company's involvement in legal proceedings are expensed as incurred . 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 December 31, 2023 and 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. Proceedings Relating to Praluent (alirocumab) Injection As described below, the Company is currently a party to patent infringement actions initiated by Amgen Inc. (and/or its affiliated entities) against the Company and/or Sanofi (and/or the Company's and Sanofi's respective affiliated entities) in a number of jurisdictions relating to Praluent. In addition, as described below, the Company filed a lawsuit against Amgen alleging that Amgen engaged in an anticompetitive bundling scheme which was designed to exclude Praluent from the market in violation of U.S. federal and state laws. United States In the United States, Amgen asserted claims of U.S. Patent Nos. 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) 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. On April 14, 2021, Amgen filed a petition for a rehearing en banc with the Federal Circuit, which was denied on June 21, 2021. On November 4, 2022, the United States Supreme Court granted Amgen's petition for writ of certiorari. An oral hearing was held on March 27, 2023. On May 28, 2023, the United States Supreme Court affirmed the Federal Circuit's decision that certain of Amgen's asserted patent claims are invalid based on lack of enablement. On May 27, 2022, the Company filed a lawsuit against Amgen in the United States District Court for the District of Delaware, alleging that, beginning in 2020, Amgen engaged in an anticompetitive bundling scheme which was designed to exclude Praluent from the market in violation of federal and state laws. The lawsuit seeks damages for harm caused by the alleged scheme, as well as injunctive relief restraining Amgen from continuing its alleged anticompetitive conduct. On August 1, 2022, Amgen filed a motion to dismiss the complaint. On August 11, 2022, Amgen filed a motion to stay these proceedings pending resolution of the patent litigation described in the preceding paragraph. An oral hearing on Amgen's motion to dismiss and motion to stay was held on January 6, 2023. On February 10, 2023, the court denied Amgen's motion to stay; 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. F-38 Table of Contents Europe Amgen has asserted European Patent No. 2,215,124 (the "'124 Patent"), which pertains to PCSK9 monoclonal antibodies, in certain countries in Europe. In October 2020, the '124 Patent claims directed to compositions of matter and medical use relevant to Praluent were ruled invalid based on a lack of inventive step by the Technical Board of Appeal (the "TBA") of the European Patent Office (the "EPO"). Following the EPO's decision, each of the '124 Patent infringement proceedings initiated by Amgen against the Company and certain of Sanofi's affiliated entities in these countries was dismissed, including in Germany. The dismissal in Germany followed an earlier finding of infringement and granting of an injunction, both of which were subsequently overturned. As a result of the overturned injunction in Germany, the Company and/or certain of Sanofi's affiliated entities are seeking damages caused by Amgen's enforcement of the injunction. An oral hearing has been scheduled for February 28, 2024. As part of its opposition to these damages claims, on March 23, 2022, Amgen filed a counterclaim that asserted the German designation of European Patent No. 2,641,917 (the "'917 Patent") and seeks, among other things, a judgment of patent infringement, injunctive relief, and monetary damages. The '917 Patent is a divisional patent of the '124 Patent discussed above (i.e., a patent that shares the same priority date, disclosure, and patent term of the parent '124 Patent but contains claims to a different invention). An oral hearing before the Munich Regional Court was held on November 29, 2023, at which Amgen's counterclaim was dismissed. The '917 Patent is also subject to opposition proceedings in the EPO, which were initiated by Sanofi on May 5, 2021. An oral hearing before the EPO was held on February 21, 2023, at which the '917 Patent was revoked. Amgen filed a notice to appeal to the TBA of the EPO on February 27, 2023. On June 1, 2023, Amgen filed a lawsuit against the Company and certain of Sanofi's affiliated entities in the Munich Local Division of the Unified Patent Court (the "UPC") alleging infringement of Amgen's European Patent No. 3,666,797 (the "'797 Patent"). The lawsuit seeks, among other things, a permanent injunction in several countries in Europe and monetary damages. The '797 Patent is a divisional patent of the '124 Patent discussed above. A trial has been scheduled for October 16–17, 2024. Also on June 1, 2023, Sanofi filed an action in the Munich Central Division of the UPC seeking revocation of the '797 Patent. A trial has been scheduled for June 4–5, 2024. Proceedings Relating to EYLEA (aflibercept) Injection Certain of the Company's patents pertaining to EYLEA are subject to post-grant proceedings before the United States Patent and Trademark Office ("USPTO"), EPO, or other comparable foreign authorities, including those described in greater detail below. In addition, the Company has filed patent infringement lawsuits in several jurisdictions alleging infringement of certain Company patents pertaining to EYLEA, including those described in greater detail below. United States Post-Grant Proceedings Before USPTO Company Patent(s) Challenger(s) Type of Challenge Date of Challenge Latest Events/Current Status U.S. Patent Nos. 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. On January 17, 2024, the Company filed a Notice of Disclaimer with the USPTO, disclaiming all claims of the '992 Patent. F-39 Table of Contents Company Patent(s) (continued) Challenger(s) Type of Challenge Date of Challenge Latest Events/Current Status U.S. Patent Nos. 9,254,338 (the "'338 Patent") and 9,669,069 (the "'069 Patent") Mylan Pharmaceuticals Inc., joined by Apotex Inc. and Celltrion IPR petitions seeking declarations of invalidity May 5, 2021 On November 9, 2022, the USPTO issued final written decisions finding that the challenged 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. U.S. Patent Nos. 10,130,681 (the "'681 Patent"), 10,888,601 (the "'601 Patent"), and 10,857,205 (the "'205 Patent") Mylan, joined by Celltrion ('601 and '681 Patents) and Samsung Bioepis Co., Ltd. ('601 Patent) IPR petitions seeking declarations of invalidity July 1, 2022 ('681 Patent and '601 Patent) October 28, 2022 ('205 Patent) On January 9, 2024, the USPTO issued final written decisions finding that that the challenged claims of the '681 and '601 Patents are unpatentable and, therefore, invalid. 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, joined by Biocon Biologics Inc. ('601 Patent) 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. U.S. Patent No. 11,253,572 (the "'572 Patent") Apotex IPR petition seeking declaration of invalidity September 9, 2022 On March 10, 2023, the USPTO declined to institute an IPR proceeding based on the Apotex IPR petition. Samsung Bioepis IPR petition seeking declaration of invalidity April 27, 2023 On November 17, 2023, the USPTO instituted IPR proceedings concerning the '572 Patent based on the Samsung IPR petition. '992 Patent and '226 Patent Celltrion, joined by Samsung Bioepis ('992 Patent) 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 January 17, 2024, the Company filed a Notice of Disclaimer with the USPTO, disclaiming all claims of 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. F-40 Table of Contents U.S. Patent Litigation On August 2, 2022, the Company filed a patent infringement lawsuit against Mylan, a wholly-owned subsidiary of Viatris Inc., in the United States District Court for the Northern District of West Virginia alleging that Mylan's filing for FDA approval of an aflibercept 2 mg biosimilar infringes certain Company patents. On April 20, 2023, Mylan filed a motion for summary judgment or partial summary judgment concerning four of the asserted patents. On April 26, 2023, the Company filed a stipulation accepting summary judgment of noninfringement of all asserted claims of the Company's U.S. Patent No. 11,104,715. On June 5, 2023, Biocon, as successor-in-interest to the aflibercept 2 mg biosimilar, was joined as a defendant to the lawsuit. 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. Patent No. 11,084,865 (the "'865 Patent"). Closing arguments were presented on August 3, 2023. On December 27, 2023, the court issued a decision finding that (i) the asserted claims of the '865 Patent were valid and infringed by Mylan and (ii) the asserted claims of the '601 and '572 Patents were infringed by Mylan but were invalid as obvious. On November 8, November 22, and November 29, 2023, respectively, the Company filed patent infringement lawsuits against Celltrion, Samsung Bioepis, and Formycon AG in the United States District Court for the Northern District of West Virginia following service on Regeneron of each company's notice of commercial marketing. The lawsuits allege that each company has infringed certain Company patents, including based on each company's filing for FDA approval of an aflibercept 2 mg biosimilar. On December 27, 2023, the Company filed a second patent infringement lawsuit against Samsung Bioepis in the United States District Court for the Northern District of West Virginia alleging that Samsung's filing for FDA approval of an aflibercept 2 mg biosimilar infringes certain Company patents. A preliminary injunction hearing concerning each of these lawsuits has been scheduled for May 2, 2024. On January 10, 2024, the Company filed a patent infringement lawsuit against Amgen in the United States District Court for the Central District of California alleging that Amgen's filing for FDA approval of an aflibercept 2 mg biosimilar infringes certain Company patents. On January 11, 2024, the Company filed a motion with the United States Judicial Panel on Multidistrict Litigation seeking to transfer this lawsuit to the United States District Court for the Northern District of West Virginia for coordinated pretrial proceedings with the lawsuits described in the preceding paragraph. A hearing on the motion to transfer has been scheduled for March 28, 2024. Europe Post-Grant Proceedings Authority/Court Company Patent(s) Challenger(s) Type of Challenge Date of Challenge Latest Events/Current Status EPO European Patent No. 2,944,306 (the "'306 Patent") Anonymous parties Opposition proceedings October 26 and October 27, 2021 Oral hearing to be scheduled. EPO 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 Trial has been scheduled to begin in June 2025. Canada On June 15, July 15, August 30, and October 4, 2022, the Company and Bayer Inc. filed patent infringement lawsuits against BGP Pharma ULC d.b.a Viatris Canada ("Viatris Canada") in the Federal Court of Canada seeking a declaration that the making, constructing, using, or selling of an aflibercept 2 mg biosimilar would directly or indirectly infringe one or more claims of the Company's Canadian Patent Nos. 2,654,510 (the "'510 Patent") and 3,007,276 (the "'276 Patent") (in the lawsuit filed on June 15, 2022); the Company's Canadian Patent No. 2,965,495 (the "'495 Patent") (in the lawsuit filed on July 15, 2022); the Company's Canadian Patent No. 2,906,768 (the "'768 Patent") (in the lawsuit filed on August 30, 2022, which has been joined with the lawsuit filed on July 15, 2022); and the Company's Canadian Patent No. 3,129,193 (the "'193 Patent") (in the lawsuit filed on October 4, 2022). A trial for the lawsuit concerning the '510 Patent and the '276 Patent (the "Viatris Canada 510/276 Lawsuit") has been scheduled for March 2024; a trial for the lawsuit concerning the '193 Patent has been scheduled for May 2024; and a trial for the lawsuit concerning the '495 Patent and the '768 Patent has been scheduled for November/December 2024. The filing of the Viatris Canada 510/276 Lawsuit resulted in a statutory 24-month stay of regulatory approval of Viatris Canada's aflibercept 2 mg F-41 Table of Contents biosimilar in Canada unless the lawsuit is resolved earlier. On March 27, 2023, in light of the transfer of Viatris Canada's New Drug Submission ("NDS") of its aflibercept 2 mg biosimilar to Biosimilar Collaborations Ireland Limited ("BCIL"), the Company filed a motion in the Federal Court of Canada seeking termination of the Viatris Canada 510/276 Lawsuit. On June 5, 2023, BCIL was added as a defendant in the Viatris Canada 510/276 Lawsuit. 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 2 mg 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 2 mg 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 2 mg 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 2 mg 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 2 mg biosimilar would directly or indirectly infringe one or more claims of the Company's '510 Patent and '276 Patent, respectively. A trial for the lawsuits concerning the '510 Patent and the '276 Patent has been scheduled for May 2025. On January 15, 2024, the Company and Bayer Inc. filed patent infringement lawsuits against Celltrion, Inc., Celltrion Healthcare Co, Ltd., Celltrion Pharma Inc., and Celltrion Healthcare Canada Ltd. in the Federal Court of Canada seeking a declaration that the making, constructing, using, or selling of an aflibercept 2 mg biosimilar would directly or indirectly infringe one or more claims of the '510 Patent, the '276 Patent, the '495 Patent, the '768 Patent, the '193 Patent, and the '315 Patent. South Korea On October 31, 2022 and December 13, 2022, Samsung Bioepis Co., Ltd. initiated invalidation proceedings before the Intellectual Property Trial and Appeal Board of the Korean Intellectual Property Office against the Company's Korean Patent Nos. 1131429 and 1406811, respectively, seeking revocation of each of such patents in its entirety. On January 16, 2023, the Company filed patent infringement lawsuits against Samsung Bioepis Co., Ltd. and its parent company Samsung Biologics Co., Ltd. before the Seoul Central District Court seeking a declaration that the making, constructing, using, or selling of an aflibercept 2 mg biosimilar would infringe one or more claims of the Company's Korean Patent No. 659477 (the "'477 Patent"). On July 20, 2023, the Company filed a preliminary injunction petition against Samsung Bioepis Co., Ltd. and its parent company Samsung Biologics Co., Ltd. before the Seoul Central District Court seeking a court order enjoining the manufacture, use, and assignment of an aflibercept 2 mg biosimilar that infringes one or more claims of the '477 Patent; and on December 20, 2023, the Seoul Central District Court granted a preliminary injunction. On January 10, 2024, the injunction was lifted against the Samsung entities following the expiration of the '477 Patent. On March 2, 2023, the Company filed an affirmative scope confirmation action against Samsung Bioepis Co., Ltd. before the Intellectual Property Tribunal and Appeal Board of the Korean Intellectual Property Office seeking a ruling that Samsung Bioepis's aflibercept 2 mg biosimilar is covered by the claims of the '477 Patent. On March 7, 2023, the action was designated for expedited proceedings. Proceedings Relating to EYLEA (aflibercept) Injection Pre-filled Syringe On June 19, 2020, Novartis Pharma AG, Novartis Pharmaceuticals Corporation, and Novartis Technology LLC (collectively, "Novartis") filed a patent infringement lawsuit (as amended on August 2, 2021) in the U.S. District Court for the Northern District of New York asserting claims of Novartis's U.S. Patent No. 9,220,631 (the "'631 Patent") and seeking preliminary and permanent injunctions to prevent the Company from continuing to infringe the '631 Patent. Novartis also seeks a judgment of patent infringement of the '631 Patent, monetary damages (together with interest), an order of willful infringement of the '631 Patent (which would allow the court in its discretion to award damages up to three times the amount assessed), costs and expenses of the F-42 Table of Contents lawsuits, and attorneys' fees. On November 7, 2022, the Company and Novartis entered into a stipulation staying the lawsuit in light of the decision in the IPR proceeding discussed below. On July 16, 2020, the Company initiated two IPR petitions in the USPTO seeking a declaration of invalidity of the '631 Patent on two separate grounds. On October 26, 2021, the USPTO issued a decision instituting the IPR proceeding. An oral hearing was held on July 21, 2022. On October 25, 2022, the Patent Trial and Appeal Board ("PTAB") of the USPTO issued a final written decision invalidating all claims of the '631 Patent. On December 23, 2022, Novartis filed a notice of appeal of the PTAB's decision to the Federal Circuit. On July 17, 2020, the Company filed an antitrust lawsuit against Novartis and Vetter Pharma International Gmbh ("Vetter") in the United States District Court for the Southern District of New York seeking a declaration that the '631 Patent is unenforceable and a judgment that the defendants' conduct violates Sections 1 and 2 of the Sherman Antitrust Act of 1890, as amended (the "Sherman Antitrust Act"). The Company is also seeking injunctive relief and treble damages. On September 4, 2020, Novartis filed, and Vetter moved to join, a motion to dismiss the complaint, to transfer the lawsuit to the Northern District of New York, or to stay the suit; and on October 19, 2020, Novartis filed, and Vetter moved to join, a second motion to dismiss the complaint on different grounds. On January 25, 2021, the Company filed an amended complaint seeking a judgment that Novartis's conduct violates Section 2 of the Sherman Antitrust Act based on additional grounds, as well as a judgment of tortious interference with contract. On February 22, 2021, Novartis filed, and Vetter moved to join, a motion to dismiss the amended complaint. On September 21, 2021, the court granted Novartis and Vetter's motion to transfer this lawsuit to the Northern District of New York. As a result, this lawsuit was transferred to the same judge that had been assigned to the patent infringement lawsuit discussed above. On November 5, 2021, the Company filed a motion to stay these proceedings in light of the pending IPR proceeding discussed above. On January 31, 2022, the court denied the Company's motion to stay these proceedings and granted Novartis and Vetter's motion to dismiss the amended complaint. On June 10, 2022, the Company filed an appeal of the District Court's decision to dismiss the amended complaint with the U.S. 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. Patent No. 10,221,221 (the "'221 Patent"). Allele seeks a judgment of patent infringement of the '221 Patent, an award of monetary damages (together with interest), an order of willful infringement of the '221 Patent (which would allow the court in its discretion to award damages up to three times the amount assessed), costs and expenses of the lawsuit, and attorneys' fees. 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 In January 2017, the Company received a subpoena from the U.S. Attorney's Office for the District of Massachusetts requesting documents relating to its support of 501(c)(3) organizations that provide financial assistance to patients; documents concerning its provision of financial assistance to patients with respect to products sold or developed by Regeneron (including EYLEA, Praluent, ARCALYST, and ZALTRAP ® ); and certain other related documents and communications. On June 24, 2020, the U.S. Attorney's Office for the District of Massachusetts filed a civil complaint in the U.S. District Court for the District of Massachusetts alleging violations of the federal Anti-Kickback Statute, and asserting causes of action under the federal False Claims Act and state law. On August 24, 2020, the Company filed a motion to dismiss the complaint in its entirety. On December 4, 2020, the court denied the motion to dismiss. On December 28, 2022, the U.S. Attorney’s Office for the District of Massachusetts filed a motion for partial summary judgment. On January 31, 2023, the Company filed a motion for summary judgment. 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; and on December 11, 2023, the U.S. Court of Appeals for the First Circuit certified for appeal the court's September 27, 2023 order. 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. Department of Justice pursuant to the federal False Claims Act relating to remuneration paid to physicians in the form of consulting fees, advisory boards, speaker fees, and payment or reimbursement for travel and entertainment allegedly in violation of the federal Anti-Kickback Statute. The CIDs relate to F-43 Table of Contents EYLEA, Praluent, Dupixent, ZALTRAP, ARCALYST, and Kevzara and cover the period from January 2015 to the present. On June 3, 2021, the United States District Court for the Central District of California unsealed a qui tam complaint filed against the Company, Regeneron Healthcare Solutions, Inc., and Sanofi-Aventis U.S. LLC by two qui tam plaintiffs (known as relators) purportedly on behalf of the United States and various states (the "State Plaintiffs"), asserting causes of action under the federal False Claims Act and state law. Also on June 3, 2021, the United States and the State Plaintiffs notified the court of their decision to decline to intervene in the case. On October 29, 2021, the qui tam plaintiffs filed an amended complaint in this matter. On January 14, 2022, the Company filed a motion to dismiss the amended complaint in its entirety. 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. Department of Justice pursuant to the federal False Claims Act. The CID states that the investigation concerns allegations that the Company (i) violated the False Claims Act by paying kickbacks to distributors and ophthalmology practices to induce purchase of EYLEA, including through discounts, rebates, credit card fees, free units of EYLEA, and inventory management systems; and (ii) inflated reimbursement rates for EYLEA by excluding applicable discounts, rebates, and benefits from the average sales price reported to the Centers for Medicare & Medicaid Services. The CID covers the period from January 2011 through June 2021. The Company is cooperating with this investigation. On November 29, 2023, the U.S. Department of Justice informed the Company that it had filed a notice of partial intervention in this matter. California Department of Insurance Subpoena In September 2022, the Company received a subpoena from the Insurance Commissioner for the State of California pursuant to the California Insurance Code. The subpoena seeks information relating to the marketing, sale, and distribution of EYLEA, including (i) discounts, rebates, credit card fees, and inventory management systems; (ii) Regeneron's relationships with distributors; (iii) price reporting; (iv) speaker programs; and (v) patient support programs. The subpoena covers the period from January 1, 2014 through August 1, 2021. The Company is cooperating with this investigation. Proceedings Initiated by Other Payors Relating to Patient Assistance Organization Support The Company is party to several lawsuits relating to the conduct alleged in the civil complaint filed by the U.S. Attorney's Office for the District of Massachusetts discussed under "Department of Justice Matters" above. These lawsuits were filed by UnitedHealthcare Insurance Company and United Healthcare Services, Inc. (collectively, "UHC") and Humana Inc. ("Humana") in the United States District Court for the Southern District of New York on December 17, 2020 and July 22, 2021, respectively; and by Blue Cross and Blue Shield of Massachusetts, Inc. and Blue Cross and Blue Shield of Massachusetts HMO Blue, Inc. (collectively, "BCBS"), Medical Mutual of Ohio ("MMO"), Horizon Healthcare Services, Inc. d/b/a Horizon Blue Cross Blue Shield of New Jersey ("Horizon"), and Local 464A United Food and Commercial Workers Union Welfare Service Benefit Fund ("Local 464A") in the U.S. District Court for the District of Massachusetts on December 20, 2021, February 23, 2022, April 4, 2022, and June 17, 2022, respectively. These lawsuits allege causes of action under state law and the federal Racketeer Influenced and Corrupt Organizations Act and seek monetary damages and equitable relief. 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. District Court for the District of Massachusetts discussed under "Department of Justice Matters" above. On September 27, 2022, the lawsuits filed by BCBS, MMO, and Horizon were stayed by the U.S. District Court for the District of Massachusetts pending resolution of the proceedings before the same court discussed under "Department of Justice Matters" above; and, in light of these stays, the parties to the Local 464A action have also agreed to stay that matter. F-44 Table of Contents Proceedings Relating to Shareholder Derivative Complaint On June 29, 2021, an alleged shareholder filed a shareholder derivative complaint in the New York Supreme Court, naming the current and certain former members of the Company's board of directors and certain current and former executive officers of the Company as defendants and Regeneron as a nominal defendant. The complaint asserts that the individual defendants breached their fiduciary duties in relation to the allegations in the civil complaint filed by the U.S. Attorney's Office for the District of Massachusetts discussed under "Department of Justice Matters" above. The complaint seeks an award of damages allegedly sustained by the Company; an order requiring Regeneron to take all necessary actions to reform and improve its corporate governance and internal procedures; disgorgement from the individual defendants of all profits and benefits obtained by them resulting from their sales of Regeneron stock; and costs and disbursements of the action, including attorneys' fees. On July 28, 2021, the defendants filed a notice of removal, removing the case from the New York Supreme Court to the U.S. District Court for the Southern District of New York. On September 23, 2021, the plaintiff moved to remand the case to the New York Supreme Court. Also on September 23, 2021, the individual defendants moved to dismiss the complaint in its entirety. On December 19, 2022, the U.S. District Court for the Southern District of New York denied the plaintiff's motion to remand the case and granted a motion to stay the case pending resolution of the proceedings before the U.S. District Court for the District of Massachusetts discussed under "Department of Justice Matters" above. As a result of the stay, the court also terminated the Company's motion to dismiss the complaint without prejudice. The Company can therefore renew the motion to dismiss upon conclusion of the stay. 17. Net Income Per Share The calculations of basic and diluted net income per share are as follows: Year Ended December 31, (In millions, except per share data) 2023 2022 2021 Net income - basic and diluted $ 3,953.6 $ 4,338.4 $ 8,075.3 Weighted average shares - basic 106.7 107.1 105.7 Effect of dilutive securities: Stock options 4.9 4.9 5.4 Restricted stock awards and restricted stock units 2.1 1.5 1.1 Weighted average shares - diluted 113.7 113.5 112.2 Net income per share - basic $ 37.05 $ 40.51 $ 76.40 Net income per share - diluted $ 34.77 $ 38.22 $ 71.97 Shares which have been excluded from diluted per share amounts because their effect would have been antidilutive include the following: Year Ended December 31, (Shares in millions) 2023 2022 2021 Stock options 1.8 2.3 2.9 F-45 Table of Contents 18. Statement of Cash Flows The following provides a reconciliation of cash, cash equivalents, and restricted cash reported within the Consolidated Balance Sheet to the total of the same such amounts shown in the Consolidated Statement of Cash Flows: December 31, (In millions) 2023 2022 2021 Cash and cash equivalents $ 2,730.0 $ 3,105.9 $ 2,885.6 Restricted cash included in Other noncurrent assets 7.8 13.5 12.5 Total cash, cash equivalents, and restricted cash shown in the Consolidated Statement of Cash Flows $ 2,737.8 $ 3,119.4 $ 2,898.1 Restricted cash consists of amounts held by financial institutions pursuant to contractual arrangements. Supplemental disclosure of non-cash investing and financing activities As of December 31, (In millions) 2023 2022 2021 Accrued capital expenditures $ 75.4 $ 70.8 $ 74.8 Accrued contingent consideration in connection with acquisitions $ 71.6 $ 135.5 $ — F-46