10-Q – 2026-07-29 – biib-20260630.htm

Ionis Pharmaceuticals, Inc.
2018 Ionis Agreement
In the second quarter of 2026 we exercised our option with Ionis and obtained a worldwide, exclusive, royalty-bearing license to develop and commercialize a pre-clinical therapy under this agreement. In connection with the option exercise, we made a payment of $ 15.0  million to Ionis, which was recorded in acquired in-process research and development, upfront and milestone expense within our consolidated statements of income for the three and six months ended June 30, 2026.
2017 SMA Collaboration Agreement
In December 2017 we entered into a collaboration agreement with Ionis to identify new ASO drug candidates for the potential treatment of SMA. Under this agreement, we have options to license therapies arising out of this collaboration and will be responsible for the development and commercialization of such therapies.
In December 2021 we exercised our option with Ionis and obtained a worldwide, exclusive, royalty-bearing license to develop and commercialize salanersen (BIIB115), an investigational ASO in development for SMA.
In the second quarter of 2026 we recognized and paid a $ 45.0  million milestone payment due upon the initiation of a Phase 3 trial in salanersen, which was recorded in acquired in-process research and development, upfront and milestone expense within our consolidated statements of income for the three and six months ended June 30, 2026. Additionally, we may pay Ionis up to $ 110.0  million in additional development and regulatory milestone payments related to this program. Upon commercialization, we may also pay Ionis up to $ 400.0  million in additional performance-based milestone payments and tiered royalties on potential net sales of such therapies ranging from the mid-teens to high-twenties percentages.
For additional information on our collaboration arrangements with Ionis, please read Note 19, Collaborative and Other Relationships , to our consolidated financial statements included in our 2025 Form 10-K.
Eisai Co., Ltd.
LEQEMBI (lecanemab) Collaboration
We have a collaboration agreement with Eisai to jointly develop and commercialize LEQEMBI (lecanemab), an anti-amyloid antibody for the treatment of Alzheimer's disease. The FDA granted traditional approval of LEQEMBI in July 2023. Prior to receiving traditional approval, LEQEMBI had been granted accelerated approval by the FDA in January 2023, at which time it became commercially available in the U.S. Outside of the U.S., LEQEMBI is now approved in the E.U. (April 2025), Australia (September 2025), China (January 2024), Japan (September 2023) and other international markets. LEQEMBI monthly IV maintenance dosing for the treatment of early Alzheimer's disease was approved in the U.S. and China in January 2025 and September 2025, respectively, and LEQEMBI subcutaneous autoinjector (IQLIK) for weekly maintenance dosing and initiation dosing was approved in the U.S. in August 2025 and July 2026, respectively.
All costs, including research, development, sales and marketing expense, are shared equally between us and Eisai. We also share profits and losses equally. We currently have a supply agreement with Eisai to manufacture LEQEMBI drug substance and drug product through the end of 2031.
Subject to the limitations in the LEQEMBI Collaboration Agreement, Eisai has final decision-making authority on all matters relating to the collaboration and serves as the lead of LEQEMBI development and regulatory submissions globally. We co-commercialize and co-promote LEQEMBI with Eisai. The LEQEMBI Collaboration Agreement provides that each commercialization plan shall allocate the responsibilities for the activities under the plan in an equitable fashion taking into account Biogen's and Eisai's respective capabilities and provide a meaningful role for each party.
Upon commercialization of LEQEMBI in the U.S., we began recognizing our 50.0 % share of LEQEMBI product revenue, net and cost of sales, including royalties, within Alzheimer's collaboration revenue in our condensed consolidated statements of income, as we are not the principal.
Our share of LEQEMBI sales and marketing expense and development expense are recorded within selling, general and administrative expense and research and development expense, respectively, within our condensed consolidated statements of income.
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A summary of development and sales and marketing expense related to the LEQEMBI Collaboration is as follows:

For the Three Months Ended June 30, For the Six Months Ended June 30,
(In millions) 2026 2025 2026 2025
Total development expense incurred by the collaboration related to the advancement of LEQEMBI $ 61.5   $ 54.9   $ 130.8   $ 107.5  
Biogen's share of the LEQEMBI Collaboration development expense reflected in research and development expense in our condensed consolidated statements of income 30.8   27.5   65.4   53.8  
Total sales and marketing expense incurred by the LEQEMBI Collaboration
155.2   171.2   324.7   348.9  
Biogen's share of the LEQEMBI Collaboration sales and marketing expense reflected in selling, general and administrative expense in our condensed consolidated statements of income 77.6   85.7   162.3   174.5  

Amounts receivable from Eisai related to the agreements discussed above were approximately $ 134.1  million and $ 90.2  million as of June 30, 2026 and December 31, 2025, respectively. Amounts payable to Eisai related to the agreements discussed above were approximately $ 92.5  million and $ 95.5  million as of June 30, 2026 and December 31, 2025, respectively.
For additional information on our collaboration arra ngements with Eisai, please read Note 19, Collaborative and Other Relationships, to our consolidated financial statements included in our 2025 Form 10-K.
UCB
We have a collaboration agreement with UCB, effective November 2003, to jointly develop and commercialize dapirolizumab pegol, an anti-CD40L pegylated Fab, for the potential treatment of SLE and other future agreed indications. Either we or UCB may propose development of dapirolizumab pegol in additional indications. If the parties do not agree to add an indication as an agreed indication to the collaboration, we or UCB may, at the sole expense of the applicable party, pursue development in such excluded indication(s), subject to an opt-in right of the non-pursuing party after proof of clinical activity.
All costs incurred for agreed indications, including research, development, sales and marketing expense, are shared equally between us and UCB. If marketing approval is obtained, both companies will jointly commercialize dapirolizumab pegol and share profits and losses equally.
A summary of development expense related to the UCB collaboration agreement is as follows:

For the Three Months Ended June 30, For the Six Months Ended June 30,
(In millions) 2026 2025 2026 2025
Total UCB collaboration development expense $ 29.3   $ 17.8   $ 58.7   $ 39.6  
Biogen's share of the UCB collaboration development expense reflected in research and development expense in our condensed consolidated statements of income 14.6   8.9   29.3   19.8  

Supernus Pharmaceuticals, Inc. (previously Sage Therapeutics, Inc.)
In November 2020 we entered into a global collaboration and license agreement with Sage to jointly develop and commercialize ZURZUVAE (zuranolone) for the treatment of PPD. In July 2025 Sage was acquired by Supernus. ZURZUVAE was approved in the U.S. in August 2023 and in the E.U. in September 2025.
Under this collaboration, both companies will share equal responsibility and costs for development as well as profits and losses for commercialization in the U.S. Outside of the U.S., we are responsible for development and commercialization, excluding Japan, Taiwan and South Korea, with respect to zuranolone and may pay Supernus potential tiered royalties in the high-teens to low-twenties percentages.
We share 50.0 % of the net collaboration results in the U.S. with Supernus, which are recognized in collaboration profit sharing/(loss reimbursement) in our condensed consolidated statements of income. For the three and six month s ended June 30, 2026, we recognized net profit-sharing expense of approximately $ 23.9 million and $ 40.9 million, respectively, to reflect Supernus' 50.0 % share of the net collaboration results, compared to net profit-sharing expense of approximately $ 17.8 million and $ 27.9 million, respectively, in the prior year comparative periods.
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A summary of development and sales and marketing expense related to the Supernus collaboration is as follows:

For the Three Months Ended June 30, For the Six Months Ended June 30,
(In millions) 2026 2025 2026 2025
Total Supernus collaboration development expense $ 1.2   $ 1.5   $ 2.4   $ 3.9  
Biogen's share of the Supernus collaboration development expense reflected in research and development expense in our condensed consolidated statements of income 0.6   0.8   1.2   2.0  
Total sales and marketing expense incurred by the Supernus collaboration 53.3   45.7   100.8   89.2  
Biogen's share of the Supernus collaboration sales and marketing expense reflected in selling, general and administrative expense and collaboration profit sharing/(loss reimbursement) in our condensed consolidated statements of income 26.7   22.9   50.4   44.6  

Denali Therapeutics Inc.
In August 2020 we entered into a collaboration and license agreement with Denali to co-develop and co-commercialize BIIB122, a small molecule inhibitor of LRRK2 for Parkinson's disease (LRRK2 Collaboration).
Under the LRRK2 Collaboration, both companies share responsibility and costs for global development based on specified percentages as well as profits and losses for commercialization in the U.S. and China. Outside the U.S. and China we are responsible for commercialization and may pay Denali potential tiered royalties.
In May 2026 Biogen and Denali announced topline results from the Phase 2b LUMA study evaluating BIIB122, which showed that BIIB122 did not meet its primary and secondary endpoints. Based on these results we and Denali will discontinue development of BIIB122 in idiopathic Parkinson's disease.
A summary of development expense related to the Denali collaboration is as follows:

For the Three Months Ended June 30, For the Six Months Ended June 30,
(In millions) 2026 2025 2026 2025
Total Denali collaboration development expense $ 5.5   $ 12.1   $ 15.8   $ 24.9  
Biogen's share of the Denali collaboration development expense reflected in research and development expense in our condensed consolidated statements of income 3.3   7.2   9.5   14.9  

Stoke Therapeutics, Inc.
In February 2025 we entered into a collaboration and license agreement with Stoke to co-develop and commercialize zorevunersen, an investigational ASO that targets the SCN1A gene for the potential treatment of Dravet syndrome, a rare form of genetic epilepsy associated with refractory seizures and neurodevelopmental impairments. Zorevunersen dosed its first patient in August 2025, advancing zorevunersen to a global Phase 3 trial.
Under the terms of this agreement, Stoke will continue to lead global development and retain exclusive development and commercialization rights for zorevunersen in the U.S., Canada and Mexico and we will have exclusive rights to commercialize zorevunersen in the rest of the world. Both companies will share responsibility for external clinical development costs, where Stoke is responsible for 70.0 % of these development costs and we are responsible for the remaining 30.0 % of these development costs.
In connection with the closing of this transaction we made an upfront payment of $ 165.0  million to Stoke, which was recognized in acquired in-process research and development, upfront and milestone expense within our condensed consolidated statements of income for the six months ended June 30, 2025. We may also pay Stoke potential development and commercial milestone payments of up to $ 50.0  million and $ 335.0  million, respectively, if all the specified milestones set forth in this collaboration are achieved. In addition, we may pay Stoke tiered royalties on potential net sales of any products developed under this collaboration in the low-double digit to high-teen percentages.
We also have an exclusive option to license certain future follow-on ASO products targeting the SCN1A gene in all territories worldwide other than the U.S., Canada and Mexico, in exchange for separate milestone, cost sharing and royalty considerations.
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A summary of development expense related to the Stoke collaboration agreement is as follows:

For the Three Months Ended June 30, For the Six Months Ended June 30,
(In millions) 2026 2025 2026 2025
Total Stoke collaboration development expense $ 14.3   $ 8.9   $ 26.5   $ 12.8  
Biogen's share of the Stoke collaboration development expense reflected in research and development expense in our condensed consolidated statements of income 4.3   2.6   8.0   3.8  

Samsung Bioepis Co., Lt d.
2019 Development and Commercialization Agreement
In December 2019 we completed a transaction with Samsung Bioepis and secured the exclusive rights to commercialize two potential ophthalmology biosimilar products, BYOOVIZ, a ranibizumab biosimilar referencing LUCENTIS, and OPUVIZ, an aflibercept biosimilar referencing EYLEA, in major markets worldwide, including the U.S., Canada, Europe, Japan and Australia. The agreement established that Samsung Bioepis will be responsible for development and will supply both products to us at a pre-specified gross margin of approximately 45.0 %.
In October 2024 we notified Samsung Bioepis of our decision to terminate our 2019 Development and Commercialization Agreement (the DCA Agreement) solely within the U.S. and Canada. The transfer of commercialization rights for BYOOVIZ and OPUVIZ in the U.S. and Canada back to Samsung Bioepis was completed as of December 31, 2025.
In October 2025 we completed the sale of our remaining commercial rights to BYOOVIZ and OPUVIZ in Europe. Samsung Bioepis has full responsibility for commercialization of BYOOVIZ upon the transfer of commercial rights from Biogen back to Samsung Bioepis, which became effective as of January 2026.
We reflected revenue on sales of BYOOVIZ to third parties in product revenue, net in our condensed consolidated statements of income and recorded the related cost of revenue and sales and marketing expense in our condensed consolidated statements of income to their respective line items when these costs are incurred.
2013 Commercial Agreement
In December 2013 we entered into an agreement with Samsung Bioepis to commercialize, over a 10-year term, three anti-TNF biosimilar product candidates which includes IMRALDI, an adalimumab biosimilar referencing HUMIRA, FLIXABI, an infliximab biosimilar referencing REMICADE, and BENEPALI, an etanercept biosimilar referencing ENBREL, in Europe. In July 2024 we exercised an option to extend this agreement by an additional five years .
We reflect revenue on sales of BENEPALI, IMRALDI and FLIXABI to third parties in product revenue, net in our condensed consolidated statements of income and record the related cost of revenue and sales and marketing expense in our condensed consolidated statements of income to their respective line items when these costs are incurred. Royalty payments to AbbVie on sales of IMRALDI are recognized in cost of sales within our condensed consolidated statements of income.
We share 50.0 % of the profit or loss related to our 2013 commercial agreement with Samsung Bioepis, which is recognized in collaboration profit sharing/(loss reimbursement) in our condensed consolidated statements of income. For the three and six months ended June 30, 2026, we recognized net profit-sharing expense of approximately $ 44.9  million and $ 102.1 million, respectively, to reflect Samsung Bioepis' 50.0 % sharing of the net collaboration profits, compared to net profit-sharing expense of approximately $ 57.2 million and $ 105.2 million, respectively, in the prior year comparative periods.
Other Services
Simultaneous with the formation of Samsung Bioepis, we also entered into a license agreement with Samsung Bioepis. Under this license agreement, we granted Samsung Bioepis an exclusive license to use, develop, manufacture and commercialize biosimilar products created by Samsung Bioepis using Biogen product-specific technology. In exchange, we receive single-digit royalties on biosimilar products developed and commercialized by Samsung Bioepis. Royalty revenue under the license agreement is recognized as a component of contract manufa cturing, royalty and other revenue in our condensed consolidated statements of income.
Amounts receivable from Samsung Bioepis related to the agreements discussed above were approximately $ 3.5  million and $ 4.4  million as of June 30, 2026 and December 31, 2025, respectively. Amounts payable to
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Samsung Bioepis related to the agreements discussed above were zero and approximately $ 42.7  million as of June 30, 2026 and December 31, 2025, respectively.
For additional information on our collaboration arrangements with Samsung Bioepis and our other significant collaboration arrangements, please read Note 19, Collaborative and Other Relationships, to our consolidated financial statements included in our 2025 Form 10-K.
Sobi
As part of our acquisition of Apellis, we have a collaboration and license agreement with Sobi to jointly develop and commercialize pegcetacoplan for use systemically or for local non-ophthalmological administration. Under the agreement, we have commercialization rights for EMPAVELI in the U.S. and Sobi has exclusive rights to commercialize pegcetacoplan as ASPAVELI in the rest of the world.
We supply pegcetacoplan to Sobi for development and for commercialization outside of the United States in accordance with a supply agreement between the parties.
Pursuant to the terms of our collaboration and license arrangement, as amended by a buy-down agreement entered into in July 2025 which reduces Sobi's royalty obligations by 90% subject to a defined cap, we are eligible to receive tiered royalties in the low single digits on net sales of ASPAVELI outside of the United States. If the defined cap is exceeded in a future period, the royalty terms in the original agreement will be reinstated, and we will earn royalties ranging from the high teens to high twenties on such net sales.
For the three and six months ended June 30, 2026, we recognized approximately $ 13.3  million in revenues from Sobi related to the agreements above, which are reflected as a component of contract manufacturing, royalty and other revenue in our condensed consolidated statements of income.
Other Research and Discovery Arrangements and Funding Arrangements
These arrangements may include the potential for future milestone payments based on the achievement of certain clinical and commercial development payable over a period of several years.
Alteogen Inc.
In March 2026 we entered into an exclusive license agreement with Alteogen Inc. to enable the development of a subcutaneous formulation of two biologics using Alteogen's ALT-B4 hyaluronidase technology.
In connection with the closing of this transaction we accrued an upfront payment of $ 20.0  million to Alteogen, which was recognized in acquired in-process research and development, upfront and milestone expense within our condensed consolidated statements of income for the six months ended June 30, 2026 and was paid during the second quarter of 2026.
Alteogen will also be eligible to receive a $ 10.0  million option payment if a second program is selected for development, as well as potential development, regulatory and commercial milestone payments and tiered royalties in the mid-single digit percentages on net sales of any combination products resulting from the collaboration.
Alloy Therapeutics, Inc.
In March 2026 we entered into a collaboration and license agreement with Alloy Therapeutics Inc. for the use of Alloy’s novel and proprietary AntiClastic ASO Platform. Through this collaboration, we plan to apply the platform to advance antisense therapeutics against multiple targets.
In connection with the closing of this transaction we accrued an upfront payment of $ 12.0  million to Alloy, which was recognized in acquired in-process research and development, upfront and milestone expense within our condensed consolidated statements of income for the six months ended June 30, 2026 and was paid during the second quarter of 2026.
Alloy will also be eligible to receive potential milestone payments and tiered royalties on any products resulting from the collaboration.
Royalty Pharma Funding Arrangement
In February 2025 we entered into a funding agreement with Royalty Pharma under which we received $ 200.0  million in 2025 and $ 50.0  million in 2026 to co-fund our development costs for the litifilimab program. As there is a substantive transfer of risk to the financial partner for the amount invested, the development funding will be
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recognized by us as an obligation to perform contractual services. This funding was recognized as a reduction to research and development expense within our condensed consolidated statements of income, proportionate to the related expen se. For the three and six months ended June 30, 2026, we received $ 25.0  million and $ 50.0 million, respectively, from Royalty Pharma, compared to $ 50.0  million and $ 100.0  million, respectively, in the prior year comparative periods. All funding has been received and the funding period has concluded as of June 30, 2026.
If the litifilimab clinical trials are successful for the indications based on the applicable clinical trials, upon regulatory approval in the U.S. or certain major markets in the world, Royalty Pharma will be eligible to receive approval-based fixed milestone payments of up to $ 250.0  million. The milestone payments due upon approval will be recorded as a component of other (income) expense, net within our condensed consolidated statements of income, when incurred.
If litifilimab receives regulatory approval, Royalty Pharma will be eligible to receive royalties of a mid-single digit percentage of the applicable net sales, which will be recorded as cost of sales within our condensed consolidated statements of income.
MorphoSys AG
As part of our acquisition of HI-Bio in July 2024, we acquired HI-Bio's pre-existing in-license commitments under third-party agreements with MorphoSys (a wholly-owned subsidiary of Novartis), which included tiered royalties on potential future net sales ranging from high-single digit to mid-teen percentages, as well as potential development, regulatory and commercial milestone payments of up to $ 130.0  million, $ 230.0  million and $ 640.0  million, respectively. These amounts included milestone payments due upon the first patient dosed in a Phase 3 clinical trial of felzartamab in a first and second indication of $ 35.0  million and $ 30.0  million, respectively, which were earned during the first and second quarters of 2025 and recorded within acquired in-process research and development, upfront and milestone expense.
In April 2026 we entered into a definitive agreement with TJ Bio, where we assumed regulatory and sales milestone obligations under a pre-existing agreement between TJ Bio and MorphoSys and may pay MorphoSys tiered royalties on potential net sales of felzartamab in the greater China region.
Other
For the three and six months ended June 30, 2026, we recorded approximately $ 4.0  million and $ 6.0 million, respectively, as acquired in-process research and development, upfront and milestone expense in our condensed consolidated statements of income related to other research and discovery related arrangements, compared to $ 16.6  million and $ 17.3  million, respectively, in the prior year comparative periods.

Note 19:
Investments in Variable Interest Entities

Unconsolidated Variable Interest Entities
We have relationships with various variable interest entities that we do not consolidate as we lack the power to direct the activities that significantly impact the economic success of these entities. These relationships include investments in certain biotechnology companies and research collaboration agreements.
As of June 30, 2026 and December 31, 2025, the carrying value of our investments in certain biotechnology companies representing potential unconsolidated variable interest entities totaled $ 48.4 million and $ 49.8 million, respectively. Our maximum exposure to loss related to these variable interest entities is limited to the carrying value of our investments.
We have also entered into research collaboration agreements with certain variable interest entities where we are required to fund certain development activities. These development activities are included in research and development expense in our condensed consolidated statements of income as they are incurred. We have provided no financing to these variable interest entities other than previous contractually required amounts.
For additional information on our investments in variable interest entities, please read Note 20, Investments in Variable Interest Entities, to our consolidated financial statements included in our 2025 Form 10-K.
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Note 20:
Litigation

We are currently involved in various claims, investigations and legal proceedings, including the matters described below. For information as to our accounting policies relating to claims and legal proceedings, including use of estimates and contingencies, please read Note 1, Summary of Significant Accounting Policies, to our consolidated financial statements included in our 2025 Form 10-K.
With respect to some loss contingencies, an estimate of the possible loss or range of loss cannot be made until management has further information, including, for example, (i) which claims, if any, will survive dispositive motion practice; (ii) information to be obtained through discovery; (iii) information as to the parties' damages claims and supporting evidence; (iv) the parties’ legal theories; and (v) the parties' settlement positions. If an estimate of the possible loss or range of loss can be made at this time, it is included in the potential loss contingency description below.
The claims and legal proceedings in which we are involved also include challenges to the scope, validity or enforceability of the patents relating to our products, pipeline or processes and challenges to the scope, validity or enforceability of the patents held by others. These include claims by third parties that we infringe their patents. An adverse outcome in any of these proceedings could result in one or more of the following and have a material impact on our business or consolidated results of operations and financial position: (i) loss of patent protection; (ii) inability to continue to engage in certain activities; and (iii) payment of significant damages, royalties, penalties and/or license fees to third parties.
Loss Contingencies
Securities Litigation
We and certain current and former officers are defendants in four securities actions pending in the District Court, one filed in November 2020 (Nadia Shash was named lead plaintiff and named in an amended complaint along with named plaintiff Amjad Khan in April 2021), which relates to statements about ADUHELM, one filed by the Oklahoma Firefighters Pension and Retirement System in February 2022, which relates to statements about ADUHELM, one filed in May 2024 (Francis Clarity Stokes was named lead plaintiff and named along with Thomas Allen Gray in an amended complaint filed in December 2024), which relates to statements about LEQEMBI, TECFIDERA and VUMERITY, and one filed in August 2023 (Ray Peleckas and the Michigan Laborers’ Pension Fund were appointed lead plaintiffs and named in an amended complaint filed in October 2023), which relates to statements made by Apellis Pharmaceuticals, Inc. about SYFOVRE. All allege violations of federal securities laws under 15 U.S.C. §78j(b) and §78t(a) and 17 C.F.R. §240.10b-5c and seek declarations of the actions as class actions and monetary relief. In March 2026 the District Court dismissed the action brought by Thomas Allen Gray and Frances Clarity Stokes and they appealed. In June 2026 Thomas Allen Gray requested voluntary dismissal of his appeal but the appeal by lead plaintiff Frances Clarity Stokes continues. In April 2026 the parties in the action brought by the Oklahoma Firefighters Pension and Retirement System reached an agreement in principle to settle the action and the District Court preliminarily approved the settlement in June 2026 and set a hearing on final approval for September 29, 2026. In March 2025 the District Court dismissed the action brought by Michigan Laborers' Pension Fund and Ray Peleckas. They appealed and the appeal is pending.
Derivative Actions
We and members of the Board of Directors are named as defendants in five derivative actions pending in the District Court, one filed by The Booth Family Trust (Booth) in February 2022, one filed by Elaine Wang (Wang) in July 2022, one filed by Jonathan Blaufarb (Blaufarb I) in July 2024, one filed by Lawrence Hollin (Hollin) in October 2024 and one filed by Jonathan Blaufarb (Blaufarb II) in October 2024. The Booth, Wang and Blaufarb II actions relate to ADUHELM and other matters, and the Blaufarb I and Hollin actions relate to statements about LEQEMBI, our compliance controls, 2023 earnings guidance and other matters. The actions allege breach of fiduciary duty, waste of corporate assets and other common law claims, and violations of the Securities Exchange Act of 1934, 15 U.S.C. §78a et seq. The actions seek declaratory and injunctive relief, monetary relief payable to Biogen and attorneys’ fees and costs payable to the plaintiffs. All derivative actions are stayed.
IMRALDI Patent Litigation
IMRALDI is an adalimumab biosimilar manufactured by Samsung Bioepis that Biogen commercializes in Europe.
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Fresenius Kabi has alleged infringement of national counterparts of its EP '3 145 488 Patent (the EP '488 Patent), including in Spain, Italy, France and Germany, and has also threatened litigation in Switzerland. In June 2022, Fresenius Kabi filed a claim for damages and injunctive relief against Biogen France SAS in the Tribunal de Grande Instance de Paris alleging infringement of the French counterpart of the EP '488 Patent by a formulation of IMRALDI no longer commercialized in France and alleging damages of approximately € 19.1 million plus interest and costs. Biogen disputes infringement and challenges the validity of the patent. Trial was held in June 2026 and a decision is pending.
In May 2025 the Higher Regional Court of Düsseldorf, Germany held that a formulation of IMRALDI we no longer commercialize in Germany infringed the German counterpart of the EP '488 Patent, enjoined infringement and declared Fresenius Kabi's right to seek damages. Biogen has requested review of the decision by Germany's Federal Court of Justice and has challenged the validity of the patent in a separate proceeding, and a hearing on validity is set for February 2027.
Humana Patient Assistance Litigation
In February 2025 Humana filed suit against Biogen Inc., Biogen U.S. Corp. and Advanced Care Scripts, Inc. in Jefferson Circuit Court in Kentucky alleging damages related to providing MS patients with free medications and making charitable contributions to non-profit organizations that provide financial assistance to MS patients. Humana alleges breach of contract, fraud and other claims under various state laws and seeks damages, attorneys' fees and costs.
Genentech Litigation
In February 2023 Genentech Inc. filed suit in the U.S. District Court for the Northern District of California claiming that it was owed royalties on sales of TYSABRI that occurred after the expiration of a patent licensed by Genentech to Biogen. In November 2025 the court entered judgment against us for approximately $ 124.3  million. We appealed and the appeal is pending.
Antitrust Litigation
In October 2025 Local No. 1 Health Fund, the Mayor and City Council of Baltimore, Teamsters Local 237 Welfare Fund, Teamsters Local 237 Retirees' Benefit Fund, UFCW Local 1500 Welfare Fund and Jacksonville Police Officers and Fire Fighters Health Insurance Trust filed an amended complaint against us in now consolidated proceedings in the U.S. District Court for the Northern District of Illinois (the Illinois federal court). The first complaint was filed in August 2024. The plaintiffs allege violations of federal antitrust laws including 15 U.S.C. §§ 1, 2 and 13(c), the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. §1962(c) and of various state laws, based on allegations about our contracts with pharmacy benefit managers related to TECFIDERA and VUMERITY and other allegations. Plaintiffs seek declarations of the actions as class actions, monetary, declaratory and equitable relief and attorneys' fees and costs.
In addition, in September 2025 Walgreen Co. and The Kroger Co. sued us in the Illinois federal court, alleging violations of 15 U.S.C. §§ 1 and 2 based on allegations about our contracts with pharmacy benefit managers related to TECFIDERA and VUMERITY and other allegations. They seek monetary, declaratory and equitable relief and attorneys' fees and costs.
Neurimmune Litigation
In May 2025 we sued Neurimmune Holding AG and Neurimmune Subone AG (collectively, "Neurimmune") in the District Court seeking declaratory judgment and permanent injunctive relief regarding our rights under a terminated collaboration agreement related to aducanumab. In September 2025 Neurimmune counterclaimed for declaratory judgment, breach of contract and unfair competition under Massachusetts G.L. 93A and seeks monetary, declaratory and equitable relief and attorneys' fees and costs.
TECFIDERA E.U. Litigation
We have sued certain generic companies for damages for sales of generic versions of TECFIDERA in violation of our regulatory market protection, including Neuraxpharm Pharmaceuticals S.L., Neuraxpharm Netherlands B.V., Zaklady Farmaceutyczne Polpharma S.A., Sandoz B.V., Mylan Ireland Ltd. and Mylan B.V. in the District Court of Amsterdam Netherlands in November 2023; Sandoz A/S in the Danish Maritime and Commercial High Court in June 2024; and STADA Arzneimittel AG, STADA Nordic ApS, Sandoz A/S, Sandoz (Denmark) and Sandoz A/S (Finland), Glenmark Arzneimittel AG and Glenmark Pharmaceuticals Nordic AB in the Finnish Market Court in July 2024. All of these
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(unaudited, continued)

parties have counterclaimed for damages based on our actions to enforce TECFIDERA's regulatory marketing protection.
In September 2025 the European General Court annulled the May 2023 European Commission decision granting TECFIDERA an additional year of regulatory marketing protection extending until February 2025. We and the European Commission appealed and the appeal is pending.
In November 2025 the Technical Boards of Appeal of the European Patent Office revoked our EP 2 653 873 patent related to TECFIDERA, after which we stopped enforcing this patent and its national counterparts. Certain generic companies have filed claims for damages based on injunctions we obtained prior to patent revocation. Such claims have been filed in the Danish Maritime and Commercial High Court by Viatris ApS in January 2024, Glenmark Pharmaceuticals Nordic AB in July 2025, Sandoz A/S in October 2025, Neuraxpharm Sweden AB and Neuraxpharm Pharmaceuticals S.L. in February 2026 and in the Prague Municipal Court, Czechia, by Glenmark Pharmaceuticals s.r.o., Glenmark Pharmaceuticals Distribution s.r.o. and Zakłady Farmaceutyczne Polpharma S.A. in May 2026.
Germany Tax Matter
In December 2025 and January 2026 a German tax authority issued assessments against us of approximately € 209.8  million including interest, which continues to accrue. We are challenging the assessments.
Other Matters
Government Investigations
In May 2024 the Italian Competition Authority informed us that it is investigating Biogen and other companies in relation to our biosimilar product BYOOVIZ.
In September 2025 we received a Civil Investigative Demand from the Louisiana Department of Justice for information regarding our policies relating to the purchase of drugs by healthcare organizations that are covered entities under Section 340B of the Public Health Service Act.
In January 2026 we received a request for information regarding TECFIDERA from the European Commission Directorate-General for Competition. In July 2026 the Commission informed us that it has closed the matter.
In May 2026 the Italian Competition Authority announced that it is investigating Biogen in relation to our STRATIFY JCV assay.
TYSABRI Biosimilar Patent Matter
In September 2022 we filed an action in the U.S. District Court for the District of Delaware against Sandoz Inc., other Sandoz entities and Polpharma Biologics S.A. under the Biologics Price Competition and Innovation Act, 42 U.S.C. §262, seeking a declaratory judgment of patent infringement. In January 2026 we filed an amended complaint against Sandoz Inc. alleging infringement of U.S. Patent Nos. 10,233,245 and U.S. 11,292,845 and seeking damages. Trial against Sandoz Inc. is scheduled for April 2027.
Hatch-Waxman Act Litigation relating to SPINRAZA
In May and June 2026, Biogen filed patent infringement proceedings relating to SPINRAZA Orange-Book listed patents (U.S. Patent Nos. 9,926,559, 10,436,802 and 12,013,403) pursuant to the Drug Price Competition and Patent Term Restoration Act of 1984 (the Hatch-Waxman Act) in the U.S. District Court for the District of Delaware against Somerset Therapeutics, LLC, Somerset Pharma, LLC, Somerset Therapeutics Private Limited f/k/a Somerset Therapeutics Limited and Odin Pharmaceuticals, LLC (collectively, Somerset) and Cipla Ltd. and Cipla USA, Inc.
In June 2026, Biogen, Cold Spring Harbor Laboratory and Ionis Pharmaceuticals, Inc. filed patent infringement proceedings relating to additional SPINRAZA Orange-Book listed patents (U.S. Patent Nos. 8,361,977, 8,980,853 and 9,717,750) pursuant to the Hatch-Waxman Act in the U.S. District Court for the District of Delaware against Somerset.
Eisai Matter
In June 2025 we filed a request for arbitration in the International Court of Arbitration of the International Chamber of Commerce seeking adoption of a budget and commercialization plan for the European Territory that allocates commercialization activities to Biogen and Eisai in an equitable fashion taking into account our respective capabilities and provides a meaningful role for each party. A hearing is set for May 2027.
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BIOGEN INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited, continued)

Product Liability and Other Legal Proceedings
We are also involved in product liability claims and other legal proceedings incidental to our normal business activities. While the outcome of any of these proceedings cannot be accurately predicted, we do not believe the ultimate resolution of any of these existing matters would have a material adverse effect on our business or financial condition.

Note 21:
Segment Information

We operate and are managed as one operating segment, and derive revenue from activities related to the discovery, development and delivery of innovative therapies for people living with serious and complex diseases.
Our research and development organization is responsible for the research and discovery of new product candidates and supports development and registration efforts for potential future products. Our pharmaceutical, operations and technology organization manages the development of the manufacturing processes, clinical trial supply, commercial product supply, distribution, buildings and facilities. Our commercial organization is responsible for U.S. and international development of our commercial products. We are also supported by corporate staff functions.
Our CEO, as the CODM, manages and allocates resources to the operations of our company on a total company basis by assessing the overall level of resources available and deciding how to best deploy these resources across functions, therapeutic areas and research and development projects that are in line with our long-term company-wide strategic goals. In making these decisions, our CEO is provided with and uses consolidated financial information for purposes of evaluating performance, forecasting future period financial results, allocating resources and setting incentive targets. The CODM performs this assessment based on the segment’s net income. Through this analysis, which includes a comparison to budgeted results, the CODM assesses performance and how to allocate resources across the functions discussed above. The measure of segment assets used in determining how to manage and allocate resources is reported within our condensed consolidated balance sheets as total assets.
The table presented below, which was prepared in accordance with the accounting policies discussed in Note 1, Summary of Significant Accounting Policies , to our consolidated financial statements included in our 2025 Form 10-K, contains additional information on our segment’s revenue and profits, including significant segment expense and other segment items.
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BIOGEN INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited, continued)

Additional Segment Information
The following table includes additional information about reported segment revenue, significant segment expense and segment measure of profitability:

For the Three Months Ended June 30, For the Six Months Ended June 30,
(In millions) 2026 2025 2026 2025
Total revenue $ 2,736.0   $ 2,645.5   $ 5,213.8   $ 5,076.5  
Less cost and expense:
Cost of sales, excluding amortization and impairment of acquired intangible assets:
Product cost of sales 582.3   415.0   1,061.0   877.2  
Royalty cost of sales 194.6   190.0   376.9   357.1  
Research and development:
Research and discovery 41.6   46.6   82.1   90.9  
Early stage programs 49.3   51.9   118.3   124.3  
Late stage programs 119.8   44.6   222.3   94.0  
Marketed products 151.8   87.7   306.0   177.2  
Other research and development costs (1)
167.1   168.2   339.9   346.7  
Acquired in-process research and development, upfront and milestone expense 164.0   46.6   198.0   247.3  
Selling, general and administrative 709.7   583.8   1,317.0   1,156.3  
Other segment expense (2)
458.3   376.3   775.3   730.2  
Net Income attributable to Biogen Inc. $ 97.5   $ 634.8   $ 417.0   $ 875.3  

(1) Other research and development costs primarily consist of indirect costs incurred in support of overall research and development activities and non-specific programs, including activities that benefit multiple programs, such as management costs, as well as depreciation, information technology and facility-based expenses and are not allocated to a specific program or stage.
(2) Other segment expense includes: amortization and impairment of acquired intangible assets; collaboration profit sharing/(loss reimbursement); (gain) loss on fair value remeasurement of contingent consideration; restructuring charges; other (income) expense, net; and income tax (benefit) expense .
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ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion should be read in conjunction with our unaudited condensed consolidated financial statements (condensed consolidated financial statements) and the accompanying notes beginning on page  8 of this quarterly report on Form 10-Q and our audited consolidated financial statements and the accompanying notes included in our 2025 Form 10-K.
The results and operations of Apellis, along with the estimated fair values of the assets acquired and liabilities assumed in the Apellis acquisition, have been included in our condensed consolidated financial statements since the closing of the Apellis acquisition on May 14, 2026.

EXECUTIVE SUMMARY
INTRODUCTION
Biogen is a global biopharmaceutical company focused on discovering, developing and delivering innovative therapies for people living with serious and complex diseases. We are focused on advancing our pipeline, including significant late stage programs, in neurology, specialized immunology and rare diseases across multiple modalities. Our drug discovery and development efforts are supported by internal research and development programs, external collaborations and acquisitions of businesses and assets.
Our marketed products include VUMERITY, TYSABRI, TECFIDERA, AVONEX and PLEGRIDY for the treatment of MS; SPINRAZA for the treatment of SMA; SKYCLARYS for the treatment of FA; QALSODY for the treatment of ALS; SYFOVRE for the treatment of GA; and EMPAVELI for the treatment of PNH, C3G and primary IC-MPGN.
We also have collaborations with Eisai on the commercialization of LEQEMBI for the treatment of Alzheimer's disease and Supernus on the commercialization of ZURZUVAE for the treatment of PPD. We have certain business and financial rights with current and other potential anti-CD20 therapies, pursuant to our collaboration arrangements with Genentech, a wholly owned member of the Roche Group. Under the collaboration arrangements, we currently recognize revenue from the following products: OCREVUS, GAZYVA, RITUXAN, RITUXAN HYCELA, LUNSUMIO and COLUMVI.
On May 14, 2026, we completed the acquisition of Apellis. As a result of this acquisition we acquired SYFOVRE for the treatment of geographic atrophy, or GA, an immune-mediated retinal disease; and EMPAVELI for the treatment of paroxysmal nocturnal hemoglobinuria, or PNH, a rare blood disorder, and C3 glomerulopathy, or C3G, and primary immune complex membranoproliferative glomerulonephritis, or primary IC-MPGN, in rare immune-mediated kidney diseases. For additional information on the acquisition of Apellis, please read Note 2, Acquisitions , to these condensed consolidated financial statements.
We commercialize a portfolio of biosimilars of advanced biologics including: BENEPALI, an etanercept biosimilar referencing ENBREL; IMRALDI, an adalimumab biosimilar referencing HUMIRA; and FLIXABI, an infliximab biosimilar referencing REMICADE.
For additional information on our collaboration arrangements, please read Note 18, Collaborative and Other Relationships, to our condensed consolidated financial statements included in this report.
BUSINESS ENVIRONMENT
The biopharmaceutical industry and the markets in which we operate are intensely competitive. Many of our competitors are working to develop or have commercialized products similar to those we market. In addition, the commercialization of certain of our own approved products, products of our collaborators and pipeline product candidates may negatively impact future sales of our existing products.
Our products and revenue streams continue to face increasing competition in many markets from the introduction of new originator therapies, generics, biosimilars of existing products and products approved under abbreviated regulatory pathways. Some of these products are likely to be sold at substantially lower prices than branded products. Accordingly, the introduction of such products as well as other lower-priced competing products has significantly reduced, and in the future may significantly reduce, both the price that we are able to charge for our products and the volume of products we sell, which can negatively impact our revenue. In addition, in some markets, when a generic or biosimilar version of one of our products is commercialized, it may be automatically substituted for our product and significantly reduce our revenue in a short period of time.
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Sales of our products depend, to a significant extent, on the availability and extent of adequate coverage, pricing and reimbursement from government health administration authorities, private health insurers and other organizations. When a new pharmaceutical product is approved, the availability of government and private reimbursement for that product may be uncertain, as is the pricing and the amount for which that product will be reimbursed.
Our future revenue growth will depend upon the successful clinical development, regulatory approval and launch of new commercial products as well as additional indications for our existing products, our ability to obtain and maintain patents and other rights related to our marketed products, assets originating from our research and development efforts and/or successful execution of external business development opportunities.
We seek to ensure an uninterrupted supply of medicines to patients around the world. To that end, we regularly review our manufacturing capacity, capabilities, processes and facilities. In order to support our future growth and drug development pipeline, we expanded our large molecule production capacity and built a large-scale biologics manufacturing facility in Solothurn, Switzerland. The Solothurn facility is operational and has been approved for the manufacture of LEQEMBI and TYSABRI. We believe that the Solothurn facility will support our anticipated near to mid-term needs for the manufacturing of biologic assets. The plant represents a significant increase in our overall manufacturing capacity. Additionally, we continue to invest to modernize, automate and support the capacity requirements for our pipeline and existing products at our existing manufacturing facilities in RTP, North Carolina. If we are unable to fully utilize our manufacturing facilities, we will incur additional excess capacity charges which would have a negative effect on our financial condition and results of operations.
For a detailed discussion on our business environment, please read Item 1. Business , in our 2025 Form 10-K. For additional information on our competition and pricing risks that could negatively impact our product sales, please read Item 1A. Risk Factors included in this report.
TYSABRI
A biosimilar entrant of TYSABRI was approved in the U.S. and the E.U. in 2023. We expect the future sales of TYSABRI will continue to be adversely affected by the entrance of this biosimilar.
TECFIDERA
In November 2025 the Technical Boards of Appeal of the European Patent Office revoked our EP 2 653 873 patent related to TECFIDERA, after which we stopped enforcing this patent and its national counterparts. Multiple TECFIDERA generic entrants are now in North America, Brazil and the E.U. and have deeply discounted prices compared to TECFIDERA. The generic competition for TECFIDERA has significantly reduced our TECFIDERA revenue compared to prior periods, and we expect that TECFIDERA revenue will continue to decline.
For additional information, please read Note 20, Litigation , to our condensed consolidated financial statements included in this report.
BUSINESS UPDATE REGARDING MACROECONOMIC CONDITIONS AND OTHER POTENTIAL DISRUPTIONS
Significant portions of our business are conducted in Europe, Asia and other international geographies. Factors such as global health outbreaks, adverse weather events, geopolitical events or conflicts, tariffs, inflation, labor or raw material shortages and other supply chain disruptions could result in product shortages or other difficulties and delays or increased costs in manufacturing or distributing our products.
Economic conditions remain uncertain as markets continue to be impacted in part by continued inflationary pressures, higher interest rates, extreme weather events, global supply chain uncertainties and risks associated with geopolitical conflicts. Global supply chain disruptions, such as strikes, work stoppages, port congestion, port closures, trade restrictions, capacity constraints and other logistical problems, may affect our ability to do business.
INTERNATIONAL TRADE
Global conflicts or disputes and interruptions in international relationships, including tariffs, trade protection measures, economic embargoes, import or export licensing requirements and the imposition of trade sanctions or similar restrictions, may affect our ability to do business and the costs that we incur in providing products to our patients.
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In 2025 the U.S. imposed a series of tariffs on imports from nearly all countries, including tariffs pursuant to the IEEPA subject to certain exemptions. Trade-related tensions between the U.S. and China have also led to a series of tariffs and sanctions being imposed by the U.S. on imports from China and retaliatory tariffs imposed by China on U.S. imports, subject as well to exemptions.
Furthermore, in 2025, the U.S. reached a series of Framework Agreements with some countries and trading blocs including the E.U., Switzerland, the U.K., Japan and South Korea, carving U.S. tariff rates for certain import categories between 10.0% and 15.0%.
In February 2026 the U.S. Supreme Court issued a ruling striking down tariffs previously imposed under the IEEPA. The ultimate availability, timing and amount of any potential refunds of such tariffs remain highly uncertain and could be subject to further legal, regulatory and administrative developments. The amount of IEEPA tariff refunds, if any, that we ultimately recover may differ from the full amount we previously paid. Furthermore, any potential refunds or recoveries may be offset by refunds due to customers for payments made in connection with the IEEPA tariffs. As of this filing date, we have not recorded a receivable for any refund of IEEPA tariffs.
Following the Supreme Court's decision, the U.S. Administration imposed a 10% baseline tariff on imports from nearly all countries, in addition to any existing non-IEEPA tariffs. The baseline tariff expired on July 24, 2026. Effective July 24, 2026, the U.S. Administration imposed new tariffs of 10.0% to 12.5% on goods from approximately 60 economies under Section 301 of the Trade Act of 1974, subject to certain exemptions, and reduced rates for goods from certain economies where we have significant operations or commercial presence, such as the E.U. and Switzerland. There remains substantial uncertainty regarding the duration of existing and newly announced tariffs, potential changes or pauses to such tariffs, tariff levels and whether further additional tariffs or other retaliatory actions may be imposed, modified or suspended and the impacts of such actions on our business.
The U.S. Secretary of Commerce previously initiated an investigation to determine the effects on the national security of imports of pharmaceuticals and pharmaceutical ingredients, including finished drug products, medical countermeasures, critical inputs such as active pharmaceutical ingredients, key starting materials and derivative products of those items, under Section 232 of the Trade Expansion Act of 1962. In April 2026 after the investigation concluded, the U.S. Administration issued a Proclamation imposing a 100% tariff on imports of patented pharmaceuticals, biologics and associated ingredients, subject to certain exemptions and reduced rates. The Proclamation tariffs are effective for certain categories on July 31, 2026, and others on September 29, 2026.
In June 2026, the EU Parliament published a list of tariffs’ exemptions for U.S. originating goods (including some pharmaceuticals) with an effective date of July 1, 2026, until December 31, 2029.
There is a high degree of uncertainty concerning what future steps countries and economic blocs will take in response to changes in global trade rules and economics.
We have a significant manufacturing presence in the U.S. While our portfolio is evolving, approximately three quarters of our 2025 U.S. product revenue was attributable to products that were largely manufactured in the U.S. However, we, and the biopharmaceutical industry, do utilize partners and production facilities located outside the U.S. for certain raw materials, ingredients, processes and components for our products and their delivery technologies. Engaging alternative suppliers may involve seeking additional regulatory approvals and incurring additional costs and risks associated with new suppliers. This may be costly in terms of time and resources needed or result in delays.
Key products that are currently manufactured primarily outside the U.S. are EMPAVELI, LEQEMBI, TECFIDERA and VUMERITY. In 2024 we initiated a technology transfer process to enable us to manufacture LEQEMBI in the U.S., which was approved in January 2026.
Although certain starting materials for SKYCLARYS rely on a single supplier based in China, the manufacturing process, including active pharmaceutical ingredients and drug substance, is primarily conducted in the U.S.
We are working to mitigate potential exposure from tariffs across our network, and as of the date of this filing, we do not expect the tariffs currently applicable to our business to result in a material adverse effect on our operations in 2026. This is based on existing tariffs in place or potential tariffs as previously announced by the U.S. Administration, our manufacturing footprint and our inventory levels and market positioning. Should additional tariffs be enacted, our business could be impacted in the future and our results and operations could differ materially from our current expectations. We will continue to monitor the current and future global tariff landscape as it evolves.
GEOPOLITICAL TENSIONS
The ongoing geopolitical tensions related to Russia's invasion of Ukraine and the military conflict in the Middle East and other global geopolitical developments have resulted in global business disruptions and economic volatility. For example, sanctions and other restrictions have been levied on the government and businesses in Russia. Although
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we do not have affiliates or employees in either Russia or Ukraine, we do provide various therapies to patients in Russia through a distributor. Government sanctions on the export of certain manufacturing materials to Russia may delay or limit our ability to get new products approved. The impact of the conflict on our operations and financial performance remains uncertain and will depend on future developments, including the severity and duration of the conflict between Russia and Ukraine, its impact on regional and global economic conditions and whether the conflict spreads or has effects on countries outside Ukraine and Russia.
We are closely monitoring ongoing geopolitical tensions in the Middle East, including the recent conflict involving the U.S., Israel and Iran, and the related regional instability. The ongoing geopolitical conflicts in the region could lead to significant disruption of fuel and energy supplies and increases in global fuel prices, which could heighten inflationary pressures, disrupt global supply chains and adversely impac t the availability and pricing of raw materials. For example, our primary shipping method for resources and finished goods is through air freight. We will continue to evaluate and take actions to mitigate any potential impacts on our business, results of operations and financial condition. Although the long-term effects remain uncertain, this geopolitical conflict did not have any material effects on our results of operations for the three and six months ended June 30, 2026 .
We will continue to monitor the ongoing conflict between Russia and Ukraine as well as the military conflict in the Middle East and other global geopolitical developments and assess any potential impacts on our business, supply chain, partners or customers, as well as any factors that could have an adverse effect on our results of operations. Revenue generated from sales in Russia and Ukraine represent less than 2.0% of total revenue for the three and six months ended June 30, 2026 and 2025. Additionally, revenue generated from sales in the broader Middle East region represents less than 3.0% of total revenue for the three and six months ended June 30, 2026 and 2025.
FACTORS AFFECTING PHARMACEUTICAL PRICING AND OTHER DEVELOPMENTS
Drug prices are under significant scrutiny in the markets in which our products are prescribed; for example the IRA has certain provisions related to drug pricing, including the ability for the U.S. government to set prices for certain drugs in Medicare. We expect drug pricing and other healthcare costs will continue to be subject to political and societal pressures on a global basis. As the policy environment remains dynamic, we will continue to monitor how uncertainty with respect to how the U.S. and foreign tariffs and the U.S. and international pricing may impact our business in the future.
Additionally, our ability to set the price for our products varies significantly from country to country and, as a result, so can the price or reimbursement of our products. Governments may use a variety of cost-containment measures to control the cost of medicines, including price cuts, mandatory rebates, value-based pricing and reference pricing (i.e., referencing prices in other countries and using those reference prices to set a price).
Our failure to obtain or maintain adequate coverage, pricing or reimbursement for our products could have an adverse effect on our business, reputation, revenue and results of operations, could curtail or eliminate our ability to adequately fund research and development programs for the discovery and commercialization of new products and/or could cause a decline or volatility in our stock price.
In addition to the impact of competition, pricing actions and other measures being taken worldwide designed to reduce healthcare costs and limit the overall level of government expenditures, our sales and operations could also be affected by other risks of doing business internationally, including the impact of public health epidemics on employees, the global economy and the delivery of healthcare treatments, geopolitical events, tariffs, supply chain disruptions, foreign currency exchange fluctuations, changes in intellectual property legal protections and changes in trade regulations and procedures.
In August 2022 the IRA was signed into law in the U.S. The IRA introduced new tax provisions, including a 15.0% corporate alternative minimum tax and a 1.0% excise tax on stock repurchases. The provisions of the IRA are effective for periods after December 31, 2022. The IRA did not result in any material adjustments to our income tax provision or other income tax balances as of June 30, 2026 and December 31, 2025. Preliminary guidance has been issued by the IRS and we expect additional guidance and regulations to be issued in future periods. We continue to assess its potential impact on our business and results of operations as further information becomes available.
The IRA also contains substantial drug pricing reforms that may have a significant impact on the pharmaceutical industry in the U.S. This includes the following:
(i)    allowing CMS to negotiate prices for select high-cost Medicare Part D drugs (beginning in 2026) and Part B drugs (beginning in 2028) to reduce out-of-pocket prescription drug costs for beneficiaries, potentially resulting in higher contributions from plans and manufacturers;
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(ii)    drug inflationary rebate requirements to penalize manufacturers from raising the prices of Medicare covered single-source drugs and biologics beyond the inflation-adjusted rate, beginning in 2022 for Part D drugs and 2023 for Part B drugs;
(iii)    to incentivize biosimilar development, the IRA provides an 8.0% Medicare Part B add-on payment for qualifying biosimilar products for a five-year period; and
(iv)    Medicare Part D redesign which replaces the current coverage gap provisions and establishes a $2,000 cap for out-of-pocket costs for Medicare beneficiaries beginning in 2025, with manufacturers being responsible for up to 10.0% of costs up to the $2,000 cap and up to 20.0% after that cap is reached.
The IRA's drug pricing controls and Medicare Part D redesign had an adverse impact on our sales, particularly for our products that are more substantially reliant on Medicare reimbursement. The IRA Medicare Part D redesign had a modest net unfavorable impact to our full-year 2025 revenue of approximately $90.0 million, concentrated in our SKYCLARYS and MS portfolio product revenue, approximately a quarter of which was associated with SKYCLARYS.
The degree of impact from this legislation on our business depends on a number of forthcoming implementation actions by regulatory authorities, which may be further impacted by other legislative acts that may modify or replace the IRA, such as the OBBBA, as discussed below. The full extent of the IRA's impact on our sales and, in turn, our business, remains uncertain.
Additionally, in May 2025 the U.S. government issued an executive order aiming to establish an MFN drug pricing policy that would tie U.S. drug prices to the prices paid for drugs in other developed countries. If HHS sets MFN pricing targets for prescription drugs, including the use of international reference pricing to set drug prices in the U.S., it could result in reduced prices and reimbursement for certain of our products in the U.S. We continue to evaluate the potential impact of this executive order. This executive order and any additional legislation, regulations or initiatives related to drug pricing, such as the CMS-proposed MFN initiatives, the Global Benchmark for Efficient Drug Pricing for certain Medicare Part B drugs and the Guarding U.S. Medicare Against Rising Drug Costs for certain Medicare Part D drugs, could create additional uncertainty around the timing and prioritization around worldwide commercial efforts and adversely impact our business and results of operations.
2025 LEGISLATION AND TAX REFORM
On July 4, 2025, the U.S. signed into law the H.R.1 legislation formally titled "An Act to Provide for Reconciliation Pursuant to Title II of H. Con. Res. 14", commonly referred to as the OBBBA.
The OBBBA contains tax provisions, such as the permanent extension or revision of certain expiring provisions of the Tax Cuts and Jobs Act enacted in 2017, modifications to the international tax framework and the restoration of favorable tax treatment for certain business provisions. The provisions of the OBBBA have multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027.
Given the complexity of tax laws, related regulations and interpretations, our current estimates may require revision as additional information becomes available regarding the application of the OBBBA provisions.
The OBBBA also enacts significant potential changes to Medicaid funding and rescinds or does not continue elements of the PPACA. The OBBBA implements additional eligibility rules on government health plans, expands administrative procedures around enrollment, modifies how states can obtain federal funding for Medicaid and no longer extends ACA premium subsidies. Additional federal and state guidance is expected to be issued in order to implement these OBBBA provisions, most of which have effective dates in 2027 and 2028.
At this time, we are unable to determine the overall impact that the OBBBA will have on our business, results of operations and financial condition, or the impact the OBBBA will have on the pharmaceutical industry as a whole because any such impact will depend upon developing interpretations of the OBBBA provisions and implementing regulations, which may be material.
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FINANCIAL HIGHLIGHTS

As described below under Results of Operations , our net income and diluted earnings per share attributable to Biogen Inc. for the three months ended June 30, 2026, compared to the three months ended June 30, 2025, reflects the following:

TOTAL REVENUE

Increased
$90.5 million or 3.4%

DILUTED EARNINGS PER SHARE

Decreased
$3.67 or 84.8%

PRODUCT REVENUE, NET

Increased
$37.7 million or 2.0%

• Rare disease revenue increased $58.7 million, or 10.8%
• Specialized immunology revenue of $127.8 million
• MS revenue decreased $143.9 million, or 13.0%

• The increase in rare disease product revenue was primarily due to revenue growth from our launch products, including SKYCLARYS and QALSODY as well as the launch of the high dose regimen of SPINRAZA, partially offset by unfavorable inventory dynamics resulting from timing of shipments of SPINRAZA in certain international markets.
• U.S. revenue for SYFOVRE and EMPAVELI was $127.8 million, which we began recognizing during the quarter, subsequent to our acquisition of Apellis on May 14, 2026.
• The decrease in MS product revenue was primarily due to a decrease in global demand of TECFIDERA, particularly in Europe, resulting from generic competition as well as decrease in global demand of our Interferon products as patients continue the long-term trend of transitioning to oral and higher efficacy therapies.
• ZURZUVAE revenue of $70.8 million in the second quarter of 2026 was driven by the continued launch in the U.S.

TOTAL COST AND EXPENSE

Increased
$702.1 million or 36.9%

• Cost of sales increased $171.9 million, or 28.4%
• R&D expense increased $130.6 million, or 32.7%
• SG&A expense increased $125.9 million, or 21.6%
• Acquired IPR&D, upfront and milestone expense increased $117.4 million, or 251.9%

• The increase in cost of sales was primarily due to higher amortization costs associated with the acquired inventory fair value step-up adjustment, which increased by $112.8 million, as well as higher revenues.
• The increase in R&D expense was primarily due to approximately $37.5 million of step-up amortization related to SKYCLARYS inventory, higher spend on clinical trials, including felzartamab, salanersen and litifilimab as well as operating expense from Apellis.
• The increase in SG&A expense was primarily due to the inclusion of the commercial and management operations of Apellis subsequent to our acquisition of the company and an increase in operational spending on sales and marketing activities in support of our U.S. and international product launches.
• The increase in acquired IPR&D, upfront and milestone expense was due to $164.0 million in upfront and milestone payments in the second quarter of 2026, primarily driven by our agreement with TJ Bio.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

• Cash, cash equivalents and marketable securities totaled approximately $1.3 billion as of June 30, 2026, compared to approximately $4.2 billion as of December 31, 2025. The decrease was primarily due to total consideration paid of $5.1 billion for our acquisition of Apellis, net of cash acquired, partially offset by net borrowings of $1.8 billion.

• We generated approximately $1.1 billion of net cash flow from operations for the six months ended June 30, 2026, compared to approximately $420.2 million in the prior year comparative period. The increase was primarily due to higher worldwide tax payments in 2025.

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RECENT DEVELOPMENTS
ACQUISITIONS
APELLIS PHARMACEUTICALS, INC.
On May 14, 2026, we completed the acquisition of all of the issued and outstanding shares of Apellis, a commercial-stage biopharmaceutical company focused on the discovery, development and commercialization of novel therapeutic compounds to treat diseases with high unmet needs. As a result of this acquisition we acquired two FDA-approved products from Apellis: SYFOVRE (pegcetacoplan injection) for the treatment of GA, an immune-mediated retinal disease; and EMPAVELI (pegcetacoplan) for the treatment of PNH, a rare blood disorder, and C3G and primary IC-MPGN, rare immune-mediated kidney diseases. The addition of Apellis is expected to enhance our short- and long-term revenue growth profile by adding two commercialized, differentiated, specialized immunology products to our growth portfolio.
Under the terms of this acquisition, Apellis shareholders were entitled to $41.00 in cash for each issued and outstanding Apellis share, which totaled approximately $5.3 billion, and one contractual, non-transferable contingent value right per share representing the right to receive contingent cash payments of up to an aggregate of $4.00 per share in cash, subject to the achievement of specified annual global net sales thresholds for SYFOVRE. In addition, the total purchase price included approximately $70.7 million of future consideration attributable to pre-acquisition services.
We funded this acquisition of Apellis with available cash and marketable securities on hand, supplemented by the issuance of a $2.0 billion term loan under our 2026 Term Loan and a $400.0 million drawdown from our revolving credit facility.
We accounted for this acquisition as a business combination using the acquisition method of accounting in accordance with ASC Topic 805, Business Combinations , and recorded assets acquired and liabilities assumed at their respective fair values as of the acquisition date.
For additional information on our acquisition of Apellis, please read Note 2, Acquisitions , to our condensed consolidated financial statements included in this report.
RAYTHERA INC.
In June 2026 we entered into a definitive agreement to acquire all of the issued and outstanding shares of RayThera Inc., a private biotechnology company focused on discovering and developing small molecule therapies in immunology. RayThera's portfolio includes a lead program which entered Phase 1 development during the third quarter of 2026 and other anti-inflammatory assets that could potentially treat immune-mediated conditions across a range of indications.
We have agreed to pay an upfront cash payment of $225.0 million upon closing, plus additional potential amounts payable upon the achievement of future clinical and regulatory milestones totaling $775.0 million.
We plan to account for this proposed acquisition as an asset acquisition as the value being acquired primarily relates to the lead program and will record the upfront payment in acquired in-process research and development, upfront and milestone expense within our condensed consolidated statements of income upon the completion of this proposed acquisition. We anticipate the proposed acquisition to close during the third quarter of 2026, subject to the satisfaction of customary closing conditions. Under the terms of this proposed acquisition, we will lead future development, manufacturing and global commercialization efforts.
The proposed acquisition excludes certain preclinical assets, which will be divested from RayThera into a newly formed independent company prior to the expected closing of this acquisition.
For additional information on our proposed acquisition of RayThera, please read Note 2, Acquisitions, to our condensed consolidated financial statements included in this report.
TJ BIOPHARMA (HANGZHOU) CO., LTD.
In April 2026 we entered into an asset purchase agreement with TJ Biopharma (Hangzhou) Co., Ltd. to acquire TJ Bio's exclusive rights to felzartamab in the greater China region. With this agreement, we own exclusive worldwide rights to felzartamab.
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Under the terms of this agreement we made an upfront payment of $100.0 million to TJ Bio, which was recorded in acquired in-process research and development, upfront and milestone expense within our condensed consolidated statements of income for the three and six months ended June 30, 2026.
T J Bio will also be eligible to receive potential commercial and sales milestone payments of up to $20.0 million and $730.0 million, respectively, if all specified milestones set forth in this collaboration are achieved. In addition, we may pay TJ Bio tiered royalties on potential net sales of felzartamab in the greater China region in the mid-single digit to low-double digit percentages.
Additionally, we assumed regulatory and sales milestone obligations under a pre-existing agreement between TJ Bio and MorphoSys and may pay MorphoSys tiered royalties on potential net sales of felzartamab in the greater China region.
COLLABORATIVE AND OTHER RELATIONSHIPS
ALTEOGEN INC.
In March 2026 we entered into an exclusive license agreement with Alteogen Inc. to enable the development of a subcutaneous formulation of two biologics using Alteogen's ALT-B4 hyaluronidase technology.
In connection with the closing of this transaction we accrued an upfront payment of $20.0 million to Alteogen, which was recognized in acquired in-process research and development, upfront and milestone expense within our condensed consolidated statements of income for the six months ended June 30, 2026, and was paid during the second quarter of 2026.
Alteogen will also be eligible to receive a $10.0 million option payment if a second program is selected for development, as well as potential development, regulatory and commercial milestone payments and tiered royalties in the mid-single digit percentages on net sales of any combination products resulting from the collaboration.
ALLOY THERAPEUTICS, INC.
In March 2026 we entered into a collaboration and license agreement with Alloy Therapeutics Inc. for the use of Alloy’s novel and proprietary AntiClastic ASO Platform. Through this collaboration, we plan to apply the platform to advance antisense therapeutics against multiple targets.
In connection with the closing of this transaction we accrued an upfront payment of $12.0 million to Alloy, which was recognized in acquired in-process research and development, upfront and milestone expense within our condensed consolidated statements of income for the six months ended June 30, 2026, and was paid during the second quarter of 2026.
Alloy will also be eligible to receive potential milestone payments and tiered royalties on any products resulting from the collaboration.
DEVELOPMENTS IN KEY COLLABORATIVE RELATIONSHIPS
LEQEMBI (lecanemab)
United States
Key developments related to LEQEMBI in the U.S. during 2026 consisted of the following:
• In May 2026 the FDA extended the review period by three months for the supplemental BLA for LEQEMBI subcutaneous autoinjector, LEQEMBI IQLIK, for a weekly initiation dose, with a new PDUFA action date of August 24, 2026; in July 2026 the FDA approved the supplemental BLA.
• In March 2026 we and our collaboration partner Eisai announced new real-world findings from an analysis of long-term treatment persistence and baseline characteristics among people receiving IV lecanemab. The findings showed that most patients continue with ongoing maintenance therapy after the initial 18 months of treatment.
Rest of World
Key developments related to LEQEMBI (lecanemab) in rest of world markets during 2026 consisted of the following:
• In February 2026 the BLA for LEQEMBI subcutaneous autoinjector was designated for Priority Review by the NMPA in China.
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OTHER KEY DEVELOPMENTS
BIIB091
• In July 2026 we announced that the Phase 2 data in relapsing-remitting multiple sclerosis has achieved proof-of-concept and that we will be exploring next steps for the asset.
ZURZUVAE (zuranalone)
• In September 2025 the EC approved ZURZUVAE in the E.U. for the treatment of PPD in adults following childbirth, offering the first and only treatment indicated for PPD in the E.U. In July 2026 ZURZUVAE launched in Germany.
DIRANERSEN (BIIB080)
• In May 2026, we announced topline results from the Phase 2 CELIA study evaluating diranersen, an investigational ASO therapy targeting tau, in individuals with early Alzheimer's disease. CELIA did not meet its primary endpoint assessing dose response; based upon what we believe to be an unprecedented combination of reduction in tau pathology and clinical benefit, including cognition, we plan to advance diranersen to registrational development.
LITIFILIMAB
• In March 2026 we announced positive results from the Phase 2 part of the AMETHYST Phase 2/3 study (Part A) of litifilimab in people living with CLE. The Phase 2 part of the AMETHYST study met its primary endpoint of reduction of disease activity in people living with CLE at Week 16, with more litifilimab participants achieving clear/almost clear skin. If approved, litifilimab could be the first targeted therapy for this disease.
• In January 2026 the FDA granted Breakthrough Therapy designation for litifilimab for the treatment of CLE.
SALANERSEN (BIIB115)
• In March 2026 we presented additional results from the Phase 1b study of salanersen, an ASO given once a year for the treatment of SMA. The data showed support for the safety and effectiveness of salanersen over one year of treatment in children with SMA who had the potential for improvement due to suboptimal clinical status with prior gene therapy.
• In June 2026 the FDA granted Breakthrough Therapy designation for salanersen for the treatment of SMA.
SPINRAZA (nusinersen)
• In March 2026 the FDA approved the high dose regimen of SPINRAZA, which is comprised of 50 mg/5 mL and 28mg/5 mL doses for the treatment of SMA.
• In January 2026 the EC granted marketing authorization for a high dose regimen of SPINRAZA in the E.U. for the treatment of 5q SMA, which is the most common form of the disease and represents approximately 95% of all SMA cases. The high dose regimen is comprised of 50 mg/5 mL and 28 mg/5 mL doses and individuals transitioning from the 12 mg dose will receive one 50 mg dose in place of their next 12 mg dose, followed by 28 mg maintenance doses every four months thereafter.
DISCONTINUED PROGRAMS AND STUDIES
BIIB122
• In May 2026 we and our collaboration partner Denali, announced topline results from the Phase 2b LUMA study evaluating BIIB122, an investigational small molecule inhibitor of LRRK2 in individuals with early-stage Parkinson's disease. Results from the study show that BIIB122 did not meet its primary and secondary endpoints. Based on these results we and Denali will discontinue development of BIIB122 in idiopathic Parkinson's disease.
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RESULTS OF OPERATIONS
REVENUE
The following revenue discussion should be read in conjunction with Note 5, Revenue , to our condensed consolidated financial statements included in this report.
Revenue is summarized as follows:

  For the Three Months Ended June 30,
(In millions, except percentages) 2026 2025 $ Change % Change
Product revenue, net:
United States $ 1,114.5  40.7  % $ 941.1  35.6  % $ 173.4  18.4  %
Rest of world 801.9  29.3  937.6  35.4  (135.7) (14.5)
Total product revenue, net 1,916.4  70.0  1,878.7  71.0  37.7  2.0 
Revenue from anti-CD20 therapeutic programs 513.5  18.8  467.3  17.7  46.2  9.9 
Alzheimer's collaboration revenue (1)
63.7  2.3  54.9  2.1  8.8  16.0 
Contract manufacturing, royalty and other revenue
242.4  8.9  244.6  9.2  (2.2) (0.9)
Total revenue $ 2,736.0  100.0  % $ 2,645.5  100.0  % $ 90.5  3.4  %

For the Six Months Ended June 30,
(In millions, except percentages) 2026 2025 $ Change % Change
Product revenue, net:
United States $ 1,953.7  37.5  % $ 1,694.9  33.4  % $ 258.8  15.3  %
Rest of world 1,715.0  32.9  1,910.3  37.6  (195.3) (10.2)
Total product revenue, net 3,668.7  70.4  3,605.2  71.0  63.5  1.8 
Revenue from anti-CD20 therapeutic programs 932.6  17.9  845.5  16.7  87.1  10.3 
Alzheimer's collaboration revenue (1)
123.2  2.3  87.9  1.7  35.3  40.2 
Contract manufacturing, royalty and other revenue 489.3  9.4  537.9  10.6  (48.6) (9.0)
Total revenue $ 5,213.8  100.0  % $ 5,076.5  100.0  % $ 137.3  2.7  %

(1) Alzheimer's collaboration revenue consists of our 50.0% share of LEQEMBI product revenue, net and cost of sales, including royalties.
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PRODUCT REVENUE
Product revenue is summarized as follows:

  For the Three Months Ended June 30,
2026 2025
(In millions, except percentages) United
States Rest of
World Total %
Total United
States Rest of
World Total %
Total $
Change % Change

Multiple Sclerosis $ 621.0  $ 342.3  $ 963.3  50.2  % $ 657.4  $ 449.8  $ 1,107.2  58.9  % $ (143.9) (13.0) %

Rare Disease 294.9  306.8  601.7  31.4  234.8  308.2  543.0  28.9  58.7  10.8 

Specialized Immunology (1)
127.8  —  127.8  6.7  —  —  —  —  127.8  — 

Biosimilars 0.1  152.7  152.8  8.0  2.5  179.2  181.7  9.7  (28.9) (15.9)

Other (2)
70.7  0.1  70.8  3.7  46.4  0.4  46.8  2.5  24.0  51.3 
Total product revenue, net $ 1,114.5  $ 801.9  $ 1,916.4  100.0  % $ 941.1  $ 937.6  $ 1,878.7  100.0  % $ 37.7  2.0  %

For the Six Months Ended June 30,
2026 2025
(In millions, except percentages) United
States Rest of
World Total %
Total United
States Rest of
World Total %
Total $
Change % Change
Multiple Sclerosis $ 1,180.4  $ 740.4  $ 1,920.8  52.4  % $ 1,147.8  $ 912.4  $ 2,060.2  57.1  % $ (139.4) (6.8) %
Rare Disease 519.4  639.5  1,158.9  31.6  465.8  640.5  1,106.3  30.7  52.6  4.8 
Specialized Immunology (1)
127.8  —  127.8  3.5  —  —  —  —  127.8  — 
Biosimilars 0.1  334.9  335.0  9.1  6.8  355.7  362.5  10.1  (27.5) (7.6)
Other (2)
126.0  0.2  126.2  3.4  74.5  1.7  76.2  2.1  50.0  65.6 
Total product revenue, net $ 1,953.7  $ 1,715.0  $ 3,668.7  100.0  % $ 1,694.9  $ 1,910.3  $ 3,605.2  100.0  % $ 63.5  1.8  %

(1) Specialized Immunology includes EMPAVELI and SYFOVRE, which were obtained as part of our acquisition of Apellis in May 2026.
(2) Other includes ZURZUVAE, FUMADERM and ADUHELM.
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MULTIPLE SCLEROSIS

• Global TYSABRI revenue decreased $3.8 million, from $454.6 million in 2025 to $450.8 million in 2026, or 0.8%, primarily due to a decrease in U.S. demand resulting from increased competition and timing of shipments in certain international markets. The decrease was partially offset by a favorable pricing change in the U.S. and the favorable impact of foreign currency exchange.
• Global VUMERITY revenue decreased $15.8 million, from $212.3 million in 2025 to $196.5 million in 2026, or 7.4%, primarily due to inventory dynamics.
• Global TECFIDERA revenue decreased $102.7 million, from $193.6 million in 2025 to $90.9 million in 2026, or 53.0%, driven by a decrease in global demand, particularly in Europe, as a result of multiple TECFIDERA generic entrants.
• Global Interferon revenue decreased $21.6 million, from $246.7 million in 2025 to $225.1 million in 2026, or 8.8%, driven by a decrease in global demand as patients continue the long-term trend of transitioning to oral and higher efficacy therapies, partially offset by an increase in pricing in the U.S.

• Global TYSABRI revenue increased $56.2 million, from $836.1 million in 2025 to $892.3 million in 2026, or 6.7%, primarily due to a favorable pricing change in the U.S. and the favorable impact of foreign currency exchange.
• Global VUMERITY revenue increased $24.4 million, from $351.1 million in 2025 to $375.5 million in 2026, or 6.9%, primarily due to favorable pricing in the U.S., partially offset by inventory dynamics.
• Global TECFIDERA revenue decreased $199.3 million, from $399.7 million in 2025 to $200.4 million in 2026, or 49.9%, driven by a decrease in global demand, particularly in Europe, as a result of multiple TECFIDERA generic entrants.
• Global Interferon revenue decreased $20.4 million, from $473.0 million in 2025 to $452.6 million in 2026, or 4.3%, driven by a decrease in global demand as patients continue the long-term trend of transitioning to oral and higher efficacy therapies, partially offset by an increase in pricing in the U.S. and the favorable impact of foreign currency exchange.

MS revenue includes sales from TECFIDERA, VUMERITY, AVONEX, PLEGRIDY and TYSABRI.
In 2026 we expect total MS revenue will decline as a result of high levels of competition for many of our MS products in both the U.S. and rest of world markets. We expect TECFIDERA revenue will be adversely impacted by accelerating generic competition in certain markets in the E.U., and we expect TYSABRI revenue to continue to be adversely affected by the entrance of a biosimilar.
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RARE DISEASE

• U.S. SPINRAZA revenue increased $55.0 million, from $149.3 million in 2025 to $204.3 million in 2026, or 36.8%, primarily driven by demand and stocking for the high-dose regimen.
• Rest of world SPINRAZA revenue decreased $45.8 million, from $243.4 million in 2025 to $197.6 million in 2026, or 18.8%, primarily due to unfavorable inventory dynamics resulting from timing of shipments of SPINRAZA in certain international markets, partially offset by higher pricing of the high dose regimen and the favorable impact of foreign currency exchange.
• Global SKYCLARYS revenue increased $37.6 million, from $130.3 million in 2025 to $167.9 million in 2026, or 28.9%, primarily related to an increase in global demand mostly driven by the continued launch in Europe and certain other international markets.
• Global QALSODY revenue increased $11.9 million, from $20.0 million in 2025 to $31.9 million in 2026, or 59.5%, primarily related to an increase in rest of world sales volumes driven by the continued launch in international markets.

• U.S. SPINRAZA revenue increased $42.8 million, from $303.7 million in 2025 to $346.5 million in 2026, or 14.1% primarily driven by demand and stocking for the high-dose regimen.
• Rest of world SPINRAZA revenue decreased $83.5 million, from $512.9 million in 2025 to $429.4 million in 2026, or 16.3%, primarily due to unfavorable inventory dynamics resulting from timing of shipments of SPINRAZA in certain international markets, partially offset by the favorable impact of foreign currency exchange.
• Global SKYCLARYS revenue increased $64.4 million, from $254.2 million in 2025 to $318.6 million in 2026, or 25.3%, primarily related to an increase in global demand mostly driven by the continued launch in Europe and certain other international markets.
• Global QALSODY revenue increased $28.9 million, from $35.5 million in 2025 to $64.4 million in 2026, or 81.4%, primarily related to an increase in rest of world sales volumes driven by the continued launch in Europe.

Rare disease revenue includes sales from SPINRAZA, QALSODY and SKYCLARYS.
In 2026 we expect growth in rare disease revenue due to the continued launch of SKYCLARYS in Europe and other international markets as well as the continued launch of QALSODY in Europe. We anticipate global SPINRAZA revenue growth to be relatively flat in 2026.
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SPECIALIZED IMMUNOLOGY

• In connection with our acquisition of Apellis on May 14, 2026, we acquired SYFOVRE (pegcetacoplan injection) for the treatment of GA, an immune-mediated retinal disease and EMPAVELI (pegcetacoplan) for the treatment of PNH, a rare blood disorder, and C3G and IC-MPGN, rare immune-mediated kidney diseases. U.S. revenue for SYFOVRE and EMPAVELI were $97.4 million and $30.4 million, respectively for the three and six months ended June 30, 2026.

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

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BIOSIMILARS

• For the three and six months ended June 30, 2026, compared to the same periods in 2025, the decreases in biosimilar revenue were primarily due to a decrease in sales volume and unfavorable pricing resulting from competition, partially offset by the favorable impact of foreign currency exchange .

Biosimilars revenue includes sales from BENEPALI, IMRALDI, FLIXABI, BYOOVIZ and TOFIDENCE. In 2025 we completed the sale of our rights to TOFIDENCE and BYOOVIZ.

OTHER PRODUCT REVENUE

ZURZUVAE
For three months ended June 30, 2026, global ZURZUVAE revenue increased $24.4 million, from $46.4 million in 2025 to $70.8 million in 2026, or 52.6%. For six months ended June 30, 2026, global ZURZUVAE revenue increased $52.1 million, from $74.1 million in 2025 to $126.2 million in 2026 or 70.3%. The increases were primarily due to higher demand resulting from an increase in total patients in the U.S. We anticipate growth in U.S. ZURZUVAE revenue as we expect total patients to continue to increase in 2026.

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REVENUE FROM ANTI-CD20 THERAPEUTIC PROGRAMS
Our share of RITUXAN, including RITUXAN HYCELA, GAZYVA and LUNSUMIO collaboration operating profits in the U.S., royalty revenue on sales of OCREVUS and other revenue from anti-CD20 therapeutic programs are summarized in the table below. For purposes of this discussion, we refer to RITUXAN and RITUXAN HYCELA collectively as RITUXAN.

  For the Three Months Ended June 30, For the Six Months Ended June 30,
(In millions) 2026 2025 2026 2025
Royalty revenue on sales of OCREVUS $ 381.4  $ 353.8  $ 698.6  $ 642.6 
Biogen’s share of pre-tax profits in the U.S. for RITUXAN, GAZYVA and LUNSUMIO 125.7  107.7  220.4  191.4 
Other revenue from anti-CD20 therapeutic programs 6.4  5.8  13.6  11.5 
Total revenue from anti-CD20 therapeutic programs $ 513.5  $ 467.3  $ 932.6  $ 845.5 

ROYALTY REVENUE ON SALES OF OCREVUS
For the three and six months ended June 30, 2026, compared to the same periods in 2025, the increases in royalty revenue on sales of OCREVUS were primarily due to sales growth of OCREVUS in the U.S.
OCREVUS royalty revenue is based on our estimates from third party and market research data of OCREVUS sales occurring during the corresponding period. Differences between actual and estimated royalty revenue will be adjusted for in the period in which they become known, which is generally expected to be the following quarter.
BIOGEN'S SHARE OF PRE-TAX PROFITS IN THE U.S. FOR RITUXAN, GAZYVA AND LUNSUMIO
For the three and six months ended June 30, 2026, compared to the same periods in 2025, the increases in our share of pre-tax profits in the U.S. for RITUXAN, GAZYVA and LUNSUMIO were primarily due to increases in sales volumes.
OTHER REVENUE FROM ANTI-CD20 THERAPEUTIC PROGRAMS
Other revenue from anti-CD20 therapeutic programs consists of our share of pre-tax co-promotion profits from RITUXAN in Canada, royalty revenue on sales of LUNSUMIO outside the U.S. and royalty revenue on net sales of COLUMVI in the U.S.
For additional information on our collaboration arrangements with Genentech, including information regarding the pre-tax profit-sharing formula and its impact on future revenue from anti-CD20 therapeutic programs, please read Note 18, Collaborative and Other Relationships, to our condensed consolidated financial statements included in this report.

ALZHEIMER'S COLLABORATION REVENUE
Alzheimer's collaboration revenue consists of our 50.0% share of LEQEMBI product revenue, net and cost of sales, including royalties, as we are not the principal. We began recognizing Alzheimer's collaboration revenue upon the accelerated approval of LEQEMBI in the U.S. during the first quarter of 2023.
For the three and six months ended June 30, 2026, we recognized Alzheimer's collaboration revenue of approximately $63.7 million and $123.2 million, respectively, compared to $54.9 million and $87.9 million, respectively, in the prior year comparative periods. The increases were primarily due to higher sales volumes driven by the continued launch of LEQEMBI in the U.S. and international markets. Additionally, the second quarter of 2025 reflects the favorable impact from the timing of shipments to China as we optimized our global inventory positions.
For additional information on our collaboration arrangements with Eisai, please read Note 18, Collaborative and Other Relationships, to our condensed consolidated financial statements included in this report.
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CONTRACT MANUFACTURING, ROYALTY AND OTHER REVENUE
Contract manufacturing, royalty and other revenue is summarized as follows:

  For the Three Months Ended June 30, For the Six Months Ended June 30,
(In millions) 2026 2025 2026 2025
Contract manufacturing revenue $ 232.4  $ 225.0  $ 469.6  $ 507.3 
Royalty and other revenue
10.0  19.6  19.7  30.6 
Total contract manufacturing, royalty and other revenue $ 242.4  $ 244.6  $ 489.3  $ 537.9 

CONTRACT MANUFACTURING REVENUE
Contract manufacturing revenue primarily reflects amounts earned under contract manufacturing agreements with our strategic customers and batches of LEQEMBI related to our collaboration with Eisai.
For the three months ended June 30, 2026, compared to the same periods in 2025, the increase in contract manufacturing revenue was primarily driven by the contract manufacturing business acquired as part of our acquisition of Apellis.
For the six months ended June 30, 2026, compared to the same periods in 2025, the decrease in contract manufacturing revenue were primarily driven by lower volumes due to timing of batch production.
ROYALTY AND OTHER REVENUE
Royalty and other revenue primarily reflects royalty revenue on biosimilar products from our license arrangements with Samsung Bioepis and royalties we receive from net sales on products related to patents that we have out-licensed, including arrangements with Sobi that we inherited through our acquisition of Apellis.
For additional information on our license arrangements with Samsung Bioepis and our collaboration arrangements with Eisai, please read Note 18, Collaborative and Other Relationships, to our condensed consolidated financial statements included in this report.

RESERVES FOR DISCOUNTS AND ALLOWANCES
Revenue from product sales is recorded net of reserves established for applicable discounts and allowances, including those associated with the implementation of pricing actions in certain international markets where we operate.
The IRA's drug pricing controls and Medicare Part D redesign had an adverse impact on our sales, particularly for our products that are more substantially reliant on Medicare reimbursement. The IRA Medicare Part D redesign had a modest net unfavorable impact to our full-year 2025 revenue of approximately $90.0 million, concentrated in our SKYCLARYS and MS portfolio product revenue, approximately a quarter of which was associated with SKYCLARYS.
The degree of impact from this legislation on our business depends on a number of forthcoming implementation actions by regulatory authorities, which may be further impacted by other legislative acts that may modify or replace the IRA, such as the OBBBA. The full extent of the IRA's impact on our sales and, in turn, our business, remains uncertain.
Reserves for discounts, contractual adjustments and returns that reduced gross product revenue are summarized as follows:

For the Three Months Ended June 30, For the Six Months Ended June 30,
(In millions) 2026 2025 2026 2025
Contractual adjustments $ 627.6  $ 680.1  $ 1,282.9  $ 1,338.4 
Discounts 223.0  208.4  437.8  395.5 
Returns 9.4  8.7  27.1  18.2 
Total discounts and allowances $ 860.0  $ 897.2  $ 1,747.8  $ 1,752.1 

For the three and six months ended June 30, 2026, reserves for discounts and allowances as a percentage of gross product revenue were approximately 30.7% and 32.0%, respectively, compared to 31.9% and 32.5%, respectively, in the prior year comparative periods.
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CONTRACTUAL ADJUSTMENTS
Contractual adjustments primarily relate to Medicaid and managed care rebates in the U.S., pharmacy rebates, co-payment (copay) assistance, VA, 340B discounts, GPO rebates, specialty pharmacy program fees and other government rebates or applicable allowances.
For the three months ended June 30, 2026, compared to the same period in 2025, the decrease in contractual adjustments was primarily driven by favorable changes in estimates primarily due to lower Medicaid rebates in the U.S., as well as lower Medicare manufacturer reserve in the U.S. and lower rebates in rest of world markets. The decreases were partially offset by GPO rebates and other rebates resulting from the sale of SYFOVRE and EMPAVELI subsequent to our acquisition of Apellis.
For the six months ended June 30, 2026, compared to the same period in 2025, the decrease in contractual adjustments was primarily driven by favorable changes in estimates primarily due to lower Medicaid rebates in the U.S., as well as lower managed care rebates in the U.S. and lower rebates in rest of world markets. The decreases were partially offset by GPO rebates and other rebates resulting from the sale of SYFOVRE and EMPAVELI subsequent to our acquisition of Apellis.
DISCOUNTS
Discounts include trade term discounts, wholesaler incentives and volume related discounts.
For the three months ended June 30, 2026, compared to the same period in 2025, the increase in discounts was primarily driven by higher volume discounts in the U.S. and rest of world as well as discounts recorded resulting from the sale of SYFOVRE and EMPAVELI subsequent to our acquisition of Apellis.
For the six months ended June 30, 2026, compared to the same period in 2025, the increase in discounts was primarily driven by higher purchase discounts in rest of world, higher volume discounts in the U.S. and discounts recorded resulting from the sale of SYFOVRE and EMPAVELI subsequent to our acquisition of Apellis.
RETURNS
Product return reserves are established for returns made by wholesalers. In accordance with contractual terms, wholesalers are permitted to return product for reasons such as damaged or expired product. The majority of wholesaler returns are due to product expiration. Provisions for estimated product returns are recognized in the period the related revenue is recognized, resulting in a reduction to product sales.
For the six months ended June 30, 2026, compared to the same period in 2025, the increase in returns were primarily driven by higher returns in the U.S.
For additional information on our revenue reserves, please read Note 5, Revenue, to our condensed consolidated financial statements included in this report.
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COST AND EXPENSE
A summary of total cost and expense is as follows:

  For the Three Months Ended June 30,
(In millions, except percentages) 2026 2025 $ Change % Change
Cost of sales, excluding amortization and impairment of acquired intangible assets $ 776.9  $ 605.0  $ 171.9  28.4  %
Research and development 529.6  399.0  130.6  32.7 
Acquired in-process research and development, upfront and milestone expense 164.0  46.6  117.4  251.9 
Selling, general and administrative 709.7  583.8  125.9  21.6 
Amortization and impairment of acquired intangible assets 168.2  130.9  37.3  28.5 
Collaboration profit sharing/(loss reimbursement) 68.8  75.0  (6.2) (8.3)
(Gain) loss on fair value remeasurement of contingent consideration 2.5  13.2  (10.7) (81.1)
Restructuring charges 165.4  (0.7) 166.1  nm
Other (income) expense, net 18.5  48.7  (30.2) (62.0)
Total cost and expense $ 2,603.6  $ 1,901.5  $ 702.1  36.9  %

For the Six Months Ended June 30,
(In millions, except percentages) 2026 2025 $ Change % Change
Cost of sales, excluding amortization and impairment of acquired intangible assets $ 1,437.9  $ 1,234.3  $ 203.6  16.5  %
Research and development 1,068.6  833.1  235.5  28.3 
Acquired in-process research and development, upfront and milestone expense 198.0  247.3  (49.3) (19.9)
Selling, general and administrative 1,317.0  1,156.3  160.7  13.9 
Amortization and impairment of acquired intangible assets 304.7  242.7  62.0  25.5 
Collaboration profit sharing/(loss reimbursement) 143.0  133.1  9.9  7.4 
(Gain) loss on fair value remeasurement of contingent consideration 23.0  22.8  0.2  0.9 
Restructuring charges 173.3  34.6  138.7  400.9 
Other (income) expense, net 38.2  117.1  (78.9) (67.4)
Total cost and expense $ 4,703.7  $ 4,021.3  $ 682.4  17.0  %

nm Not meaningful
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COST OF SALES, EXCLUDING AMORTIZATION AND IMPAIRMENT OF ACQUIRED INTANGIBLE ASSETS

For the Three Months Ended June 30, For the Six Months Ended June 30,
(In millions) 2026 2025 2026 2025
Product $ 582.3  $ 415.0  $ 1,061.0  $ 877.2 
Royalty 194.6  190.0  376.9  357.1 
Total cost of sales $ 776.9  $ 605.0  $ 1,437.9  $ 1,234.3 

PRODUCT COST OF SALES
For the three and six months ended June 30, 2026, compared to the same periods in 2025, the increases in product cost of sales were primarily due to higher period costs, higher cost of contract manufacturing revenue driven by the timing of batch releases, and higher amortization costs associated with the acquired inventory fair value step-up adjustment for SKYCLARYS, SYFOVRE and EMPAVELI.
Contract manufacturing revenue includes LEQEMBI inventory produced for Eisai. Cost of sales as a percentage of revenue was adversely affected by LEQEMBI batches due to lower margins associated with this business. For additional information on our collaboration arrangements with Eisai, please read Note 18, Collaborative and Other Relationships, to our condensed consolidated financial statements included in this report.
As a result of our acquisition of Apellis in May 2026, we recorded approximately $712.0 million of acquired inventory related to SYFOVRE and EMPAVELI, inclusive of fair value step-up adjustments related to the acquired inventory of SYFOVRE and EMPAVELI totaling approximately $567.5 million. We expect these amounts to be fully amortized by the end of 2029. For the three and six months ended June 30, 2026, amortization from the fair value step-up adjustments was approximately $69.7 million . For additional information on our acquisition of Apellis, please read Note 2, Acquisitions , to these condensed consolidated financial statements.
As a result of our acquisition of Reata in September 2023 we recorded a fair value step-up adjustment related to the acquired inventory of SKYCLARYS. We expect this amount to be fully amortized by the end of 2028. For the three and six months ended June 30, 2026, amortization from the fair value step-up adjustment recorded in cost of sales was approximately $95.6 million and $146.4 million, respectively, compared to $52.5 million and $103.9 million, respectively, in the prior year comparative periods. For additional information on our acquisition of Reata, please read Note 2, Acquisitions , to our consolidated financial statements included in our 2025 Form 10-K.
ROYALTY COST OF SALES
For the three months ended June 30, 2026, compared to the same period in 2025, the increase in royalty cost of sales was primarily due to royalties of $4.9 million associated with agreements acquired from Apellis.
For the six months ended June 30, 2026, compared to the same period in 2025, the increase in royalty cost of sales was primarily due to higher royalties payable associated with higher sales of TYSABRI.
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RESEARCH AND DEVELOPMENT

Research and development expense, as a percentage of total revenue, was 19.4% and 15.1% for the three months ended June 30, 2026 and 2025, respectively.
For the three months ended June 30, 2026, compared to the same period in 2025, the increase in research and development was primarily driven by approximately $37.5 million of step-up amortization related to SKYCLARYS inventory, higher spend on clinical trials, including felzartamab, salanersen and litifilimab as well as operating expense from Apellis. Clinical trial spend related to litifilimab during the second quarter of 2026 and 2025 was offset by $25.0 million and $50.0 million, respectively, in research and development funding received from Royalty Pharma.
EARLY STAGE PROGRAMS
Q2 2026 vs. Q2 2025
The decrease in early stage program expense was driven by a decrease in costs associated with:
• the advancement of salanersen for the treatment of SMA to late stage.
LATE STAGE PROGRAMS
Q2 2026 vs. Q2 2025
The increase in late stage program expense was driven by an increase in costs associated with:
• the advancement of salanersen for the treatment of SMA;
• the development of felzartamab for AMR, IgAN and PMN; and
• the development of litifilimab for the treatment of CLE and SLE, offset by Royalty Pharma funding received during the second quarter of 2026 and 2025 of $25.0 million and $50.0 million, respectively.
MARKETED PROGRAMS
Q2 2026 vs. Q2 2025
The increase in marketed program expense was driven by an increase in costs associated with:
• $37.5 million of step-up amortization related to SKYCLARYS inventory; and
• operating expenses incurred subsequent to our acquisition of Apellis.

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Research and development expense, as a percentage of total revenue, was 20.5% and 16.4% for the six months ended June 30, 2026 and 2025, respectively.
For the six months ended June 30, 2026, compared to the same period in 2025, the increase in research and development was primarily driven by approximately $94.3 million of step-up amortization related to SKYCLARYS inventory, higher spend on clinical trials, including felzartamab, salanersen and litifilimab as well as operating expense from Apellis. Clinical trial spend related to litifilimab during 2026 and 2025 was offset by $50.0 million and $100.0 million, respectively, in research and development funding received from Royalty Pharma.
EARLY STAGE PROGRAMS
YTD 2026 vs. YTD 2025
The decrease in early stage programs was driven by a decrease in costs associated with:
• the advancement of felzartamab for IgAN and PMN to late stage.
LATE STAGE PROGRAMS
YTD 2026 vs. YTD 2025
The increase in late stage programs was driven by an increase in costs associated with:
• the development of felzartamab for AMR, IgAN and PMN;
• the development of litifilimab for the treatment of CLE and SLE, offset by Royalty Pharma funding received during 2026 and 2025 of $50.0 million and $100.0 million, respectively;
• the advancement of salanersen for the treatment of SMA; and
• the development of zorevunersen for the treatment of Dravet syndrome.
MARKETED PROGRAMS
YTD 2026 vs. YTD 2025
The increase in marketed programs was driven by an increase in costs associated with:
• $94.3 million of step-up amortization related to SKYCLARYS inventory;
• expenses incurred resulting from our acquisition of Apellis; and
• increased spend on LEQEMBI for the treatment of Alzheimer's disease.

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Research and development expense is reported above based on the following classifications. The development stage reported is based upon the program status when incurred. Therefore, the same program could be reflected in different development stages in the same year. For several of our programs, the research and development activities are part of our collaborative and other relationships. Our costs reflect our share of the total costs incurred.
• Research and discovery: represents costs incurred to support our discovery research and translational science efforts.
• Early stage programs: are programs in Phase 1 or Phase 2 development.
• Late stage programs: are programs in Phase 3 development or in registration stage.
• Marketed products: includes costs associated with product lifecycle management activities including, if applicable, costs associated with the development of new indications for existing products.
• Other research and development costs: A significant amount of our research and development costs consist of indirect costs incurred in support of overall research and development activities and non-specific programs, including activities that benefit multiple programs, such as management costs, as well as depreciation, information technology and facility-based expenses. These costs are considered other research and development costs in the table above and are not allocated to a specific program or stage.
We expect our core research and development expense to increase in 2026, primarily due to investments in our late-stage programs and the reduction of research and development funding received from Royalty Pharma, which concluded during the second quarter of 2026. We intend to continue committing significant resources to targeted research and development opportunities while continuing to invest in our pipeline, where there is a significant unmet need and where a drug candidate has the potential to be highly differentiated.

ACQUIRED IN-PROCESS RESEARCH AND DEVELOPMENT, UPFRONT AND MILESTONE EXPENSE
Acquired in-process research and development, upfront and milestone expense includes costs incurred in connection with collaboration and license agreements such as upfront and milestone payments and, when applicable, premiums on equity securities and asset acquisitions of acquired in-process research and development.
For the three and six months ended June 30, 2026, acquired in-process research and development, upfront and milestone expense totaled approximately $164.0 million and $198.0 million, respectively, compared to $46.6 million and $247.3 million, respectively, in the prior year comparative periods. The decrease was driven by higher upfront and milestone payments in 2025 compared to 2026.
For the three months ended June 30, 2026, acquired in-process research and development, upfront and milestone expense primarily consists of the following activity:
• Upfront payment of $100.0 million to TJ Bio to acquire exclusive rights to felzartamab in the greater China region;
• Milestone payment of $45.0 million to Ionis in connection with the initiation of a Phase 3 trial in salanersen; and
• Upfront payment of $15.0 million to Ionis in connection with an option to obtain a worldwide, exclusive, royalty-bearing license to develop and commercialize a pre-clinical therapy.
For the three months ended June 30, 2025, acquired in-process research and development, upfront and milestone expense primarily consists of the following activity:
• Milestone payment of $30.0 million to MorphoSys accrued in connection with the first patient dosed in a Phase 3 clinical trial of felzartamab for the treatment of IgAN; and
• Upfront payment of $16.0 million to City Therapeutics in connection with the closing of our strategic research arrangement in May 2025.
For the six months ended June 30, 2026, acquired in-process research and development, upfront and milestone expense also included the following activity:
• Upfront payment of $20.0 million to Alteogen in connection with the closing of our collaboration and license agreement; and
• Upfront payment of $12.0 million to Alloy in connection with the closing of our collaboration and license agreement.
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For the six months ended June 30, 2025, acquired in-process research and development, upfront and milestone expense also included the following activity:
• Upfront payment of $165.0 million to Stoke in connection with the closing of our collaboration and license agreement; and
• Milestone payment of $35.0 million to MorphoSys in connection with the first patient dosed in a Phase 3 clinical trial of felzartamab for the treatment of AMR.
For additional information on our collaboration arrangements, please read Note 18, Collaborative and Other Relationships, to our condensed consolidated financial statements included in this report.

SELLING, GENERAL AND ADMINISTRATIVE
For the three and six months ended June 30, 2026, compared to the same periods in 2025, selling, general and administrative expense increased by approximately 21.6% and 13.9%, respectively, primarily due to the inclusion of the commercial and management operations of Apellis subsequent to our acquisition of the company and an increase in operational spending on sales and marketing activities in support of our U.S. and international product launches.
We expect selling, general and administrative expense for 2026 to increase when compared to 2025. We anticipate increased spend related to our integration efforts around our acquisition of Apellis and continued investment in product launches and pre-launch activities, partially offset by reduced spending for our mature products.

AMORTIZATION AND IMPAIRMENT OF ACQUIRED INTANGIBLE ASSETS
Our amortization expense is based on the economic consumption and impairment of intangible assets. Our most significant amortizable intangible assets are related to TYSABRI, AVONEX, SPINRAZA, VUMERITY, SKYCLARYS, and upon the May 2026 acquisition of Apellis, SYFOVRE and EMPAVELI.
For the three and six months ended June 30, 2026, amortization of acquired intangible assets, excluding impairment charges, totaled $168.2 million and $304.7 million, respectively, compared to $127.4 million and $239.2 million, respectively in the prior year comparative periods. The increases were primarily due to higher rates of amortization for the acquired intangible assets associated with SKYCLARYS. Additionally, we recorded $22.6 million of amortization for the acquired intangible assets as part of our acquisition of Apellis for the three and six months ended June 30, 2026. For additional information on our acquisition of Apellis, please read Note 2, Acquisitions , to these condensed consolidated financial statements.
For the three and six months ended June 30, 2026, we had no impairment charges. For the three and six months ended June 30, 2025, amortization and impairment of acquired intangible assets reflect the impact of a $3.5 million impairment charge related to a compound acquired from HI-Bio.
For additional information on the amortization and impairment of our acquired intangible assets, please read Note 7, Intangible Assets and Goodwill , to our condensed consolidated financial statements included in this report.

COLLABORATION PROFIT SHARING/(LOSS REIMBURSEMENT)
Collaboration profit sharing/(loss reimbursement) includes Samsung Bioepis' 50.0% share of the profit or loss related to our biosimilars 2013 commercial agreement with Samsung Bioepis and collaboration profit sharing/(loss reimbursement) related to Supernus' 50.0% share of the profit or loss related to ZURZUVAE for PPD.
For the three and six months ended June 30, 2026, we recognized net profit-sharing expense of approximately $44.9 million and $102.1 million, respectively, to reflect Samsung Bioepis' 50.0% sharing of the net collaboration profits, compared to net profit-sharing expense of approximately $57.2 million and $105.2 million, respectively, in the prior year comparative periods.
For the three and six months ended June 30, 2026, we recognized net profit-sharing expense of approximately $23.9 million and $40.9 million, respectively, to reflect Supernus' 50.0% share of the net collaboration results, compared to net profit-sharing expense of approximately $17.8 million and $27.9 million, respectively, in the prior year comparative periods.
For additional information on our collaboration and license arrangements with Samsung Bioepis and Supernus, please read Note 18, Collaborative and Other Relationships, to our condensed consolidated financial statements included in this report.
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(GAIN) LOSS ON FAIR VALUE REMEASUREMENT OF CONTINGENT CONSIDERATION
Consideration payable for certain of our business combinations include future payments that are contingent upon the occurrence of a particular event or events. We record an obligation for such contingent consideration payments at fair value on the acquisition date. We then revalue our contingent consideration obligations each reporting period. Changes in the fair value of our contingent consideration obligations, other than changes due to payments, are recognized as a (gain) loss on fair value remeasurement of contingent consideration in our condensed consolidated statements of income. In connection with our acquisitions of HI-Bio and Apellis we recorded contingent consideration obligations related to potential milestone payments.
F or the three and six months ended June 30, 2026 , changes in the fair value of our contingent consideration obligations were primarily due to changes in the probabilities of success and expected timing of the achievement of certain remaining developmental milestones related to our acquisition of HI-Bio, and the recognition of a $4.1 million obligation related to the acquisition of Apellis.
During the second quarter of 2025 the first milestone related to the fourth patient dosed in a phase 3 clinical trial of felzartamab for AMR was achieved, resulting in a $150.0 million milestone payment made to the former shareholders of HI-Bio, which was paid during the third quarter of 2025.
For additional information on our acquisition of Apellis, please read Note 2, Acquisitions , to these condensed consolidated financial statements. For additional information on our acquisition of HI-Bio, please read Note 2, Acquisitions , to our consolidated financial statements included in our 2025 Form 10-K.

RESTRUCTURING CHARGES
APELLIS INTEGRATION
Following the closing of the Apellis acquisition, we implemented an integration plan designed to realize operating synergies through cost savings and avoidance. For the three and six months ended June 30, 2026, we recognized approximately $153.2 million of net pre-tax restructuring charges, primarily consisting of employee severance costs and the acceleration of bonus payments that were subject to a double-trigger provision.
For additional information on our cost saving initiatives, please read Note 4, Restructuring, to our consolidated financial statements included in our 2025 Form 10-K.
2023 FIT FOR GROWTH RESTRUCTURING PROGRAM
In 2023 we initiated cost saving measures as part of our Fit for Growth program to reduce operating costs, while improving operating efficiency and effectiveness. The Fit for Growth program generated approximately $1.0 billion in gross operating expense savings by the end of 2025, some of which has been reinvested in various initiatives. The Fit for Growth program included net headcount reductions of approximately 1,400 employees and we incurred total restructuring charges of approximately $320.0 million, by the end of 2025.
For the six months ended June 30, 2025, we recorded approximately $34.2 million in restructuring charges related to severance costs from our Fit for Growth program within restructuring charges in our condensed consolidated statements of income.

OTHER (INCOME) EXPENSE, NET
For the three and six months ended June 30, 2026, compared to the same periods in 2025, the changes in other (income) expense, net primarily reflects higher gains on our equity investments in 2026.
INTEREST INCOME AND EXPENSE
For the three and six months ended June 30, 2026, net interest expense were approximately $57.0 million and $86.7 million, respectively, compared to $40.3 million and $76.4 million, respectively, in the prior year comparative periods. The changes were primarily due to lower interest income and higher interest expense resulting from our acquisition of Apellis. We anticipate higher net interest expense to continue in 2026 compared to 2025.
NET (GAINS) LOSSES IN EQUITY SECURITIES
For the three months ended June 30, 2026, net unrealized and realized gains on our holdings in equity securities were approximately $42.8 million and zero, respectively, compared to net unrealized and realized gains of approximately $5.3 million and zero, respectively, in the prior year comparative periods.
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• The net unrealized gains recognized during the three months ended June 30, 2026, primarily reflect an increase in the aggregate fair value of our investment in Denali common stock of approximately $46.7 million.
• The net unrealized gains recognized during the three months ended June 30, 2025, primarily reflect an increase in the aggregate fair value of our investments in Sage and Denali common stock of approximately $10.1 million. Sage was later disposed of during the third quarter of 2025.
For the six months ended June 30, 2026, net unrealized and realized gains on our holdings in equity securities were approximately $61.9 million and $3.2 million, respectively, compared to net unrealized losses and realized gains of approximately $35.7 million and $5.4 million, respectively, in the prior year comparative periods.
• The net unrealized gains recognized during the six months ended June 30, 2026, primarily reflect an increase in the aggregate fair value of our investment in Denali common stock of approximately $65.9 million.
• The net unrealized losses recognized during the six months ended June 30, 2025, primarily reflect a decrease in the aggregate fair value of our investments in Denali common stock of approximately $45.7 million, partially offset by an increase in the fair value of Sage common stock of approximately $23.0 million. Sage was later disposed of during the third quarter of 2025.

INCOME TAX PROVISION

For the Three Months Ended June 30, For the Six Months Ended June 30,
(In millions, except percentages) 2026 2025 2026 2025
Income before income tax (benefit) expense $ 132.4  $ 744.0  $ 510.1  $ 1,055.2 
Income tax (benefit) expense 34.9  109.2  93.1  179.9 
Effective tax rate 26.4  % 14.7  % 18.3  % 17.0  %

Our effective tax rate fluctuates from year to year due to the global nature of our operations. The factors that most significantly impact our effective tax rate include changes in tax laws, variability in the allocation of our taxable earnings among multiple jurisdictions, the amount and characterization of our research and development expense, the levels of certain deductions and credits, acquisitions and licensing transactions.
For the three and six months ended June 30, 2026, our effective tax rate was 26.4% and 18.3%, respectively, compared to 14.7% and 17.0%, respectively, in the prior year comparative periods. The increase in our effective tax rate for the three months ended June 30, 2026 was primarily driven by non-deductible expenses related to our Apellis acquisition and, to a lesser extent, the favorable deferred tax impacts of decreases in foreign withholding taxes recorded in the second quarter of 2025. The six months ended June 30, 2026, compared to the same period in 2025, also reflects favorable impacts of a current year settlement of a foreign tax audit and the vesting of certain share-based awards.
PILLAR TWO
The OECD has issued model rules, which generally provide for a jurisdictional minimum effective tax rate of 15.0% as defined in those rules. Various countries have or are in the process of enacting legislation intended to implement the principles. Our income tax provision for the three and six months ended June 30, 2026 and 2025, reflects currently enacted legislation and guidance related to the OECD model rules, including the Pillar Two side-by-side package announced by the OECD in January 2026. This enacted legislation and guidance related to the OECD model rules did not result in any material adjustments to our income tax provision or income tax balances as of June 30, 2026 and December 31, 2025. At this stage, we do not believe the side-by-side package impacts our financial results as of June 30, 2026 and December 31, 2025.
For additional information on our income taxes, please read Note 17, Income Taxes , to our consolidated financial statements included in our 2025 Form 10-K.
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FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES
Our financial condition is summarized as follows:

(In millions, except percentages) As of June 30, 2026 As of December 31, 2025 $ Change % Change
Financial assets:
Cash and cash equivalents $ 1,285.0  $ 3,008.5  $ (1,723.5) (57.3) %
Marketable securities — current —  807.2  (807.2) (100.0)
Marketable securities — non-current —  431.9  (431.9) (100.0)
Total cash, cash equivalents and marketable securities $ 1,285.0  $ 4,247.6  $ (2,962.6) (69.7) %
Borrowings:
Current portion notes payable $ 800.0  $ —  $ 800.0  nm
Notes payable $ 7,290.3  $ 6,286.8  $ 1,003.5  16.0  %
Total borrowings $ 8,090.3  $ 6,286.8  $ 1,803.5  28.7  %
Working capital:
Current assets $ 7,305.7  $ 8,974.1  $ (1,668.4) (18.6) %
Current liabilities (3,917.1) (3,349.4) (567.7) 16.9 
Total working capital $ 3,388.6  $ 5,624.7  $ (2,236.1) (39.8) %

OVERVIEW
We have historically financed and expect to continue to fund our operating and capital expenditures primarily through cash flow earned through our operations and borrowings, as well as our existing cash resources. We believe that the continued overall decline in our MS business from generic and biosimilar competition, our investments in the launch of key new products, the cost of developing of our pipeline and the completion of research funding arrangement with Royalty Pharma will have a significant adverse impact on our future cash flow from operations. We expect that these factors will be partially offset in the long term by the increased sales of new products and cash flows from the Apellis business.
We believe that our existing funds, when combined with cash generated from operations and our access to additional financing resources, if needed, are sufficient to satisfy our operating, working capital, strategic alliance, milestone payment, capital expenditure and debt service requirements for the foreseeable future. In addition, we may choose to opportunistically return cash to shareholders and pursue other business initiatives, including acquisition and licensing activities. We may also seek additional funding through a combination of new collaborative agreements, strategic alliances and additional equity and debt financings or from other sources should we identify a significant new opportunity.
On May 14, 2026, we completed the acquisition of all of the issued and outstanding shares of Apellis for $5.3 billion. This transaction was funded with available cash and marketable securities on hand, supplemented by the issuance of a $2.0 billion term loan under our 2026 Term Loan and a $400.0 million drawdown from our revolving credit facility. In connection with the acquisition we assumed responsibility for its outstanding debt obligations totaling approximately $496.7 million, which we subsequently repaid as of June 30, 2026. Additionally, we converted Apellis's outstanding unvested equity awards into cash awards totaling $416.3 million. These awards vest over the remaining requisite service periods of the original awards and are payable only if the applicable service conditions are satisfied, unless accelerated under specified termination provisions.
For additional information on our acquisition of Apellis, please read Note 2, Acquisitions , to our condensed consolidated financial statements included in this report.
For additional information on certain risks that could negatively impact our financial position or future results of operations, please read Item 1A. Risk Factors and Item 3. Quantitative and Qualitative Disclosures About Market Risk included in this report.
LIQUIDITY
WORKING CAPITAL
Working capital is defined as current assets less current liabilities. Our working capital was $3.4 billion and $5.6 billion as of June 30, 2026 and December 31, 2025, respectively. The change in working capital reflects a decrease
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in total current assets of approximately $1.7 billion and an increase in total current liabilities of approximately $567.7 million. The changes in total current assets and total current liabilities were primarily driven by the following:
CURRENT ASSETS
• $2.5 billion decrease in cash, cash equivalents and current marketable securities primarily due to consideration paid for our acquisition of Apellis as well as the repayment of $496.7 million in outstanding debt obligations assumed as part our Apellis acquisition;
• $543.2 million increase in accounts receivable primarily due to acquired receivables resulting for our acquisition of Apellis; and
• $216.2 million increase in inventory primarily due to the fair value step up adjustment for acquired inventory resulting from our acquisition of Apellis.
CURRENT LIABILITIES
• $800.0 million increase in current portion of debt due to the short-term portion of the outstanding term loan related to our acquisition of Apellis; and
• $176.3 million decrease in accrued expense and other primarily due to the timing of our annual incentive compensation payment.
For additional information on our acquisition of Apellis, please read Note 2, Acquisitions , to our condensed consolidated financial statements included in this report.
CASH, CASH EQUIVALENTS AND MARKETABLE SECURITIES
As of June 30, 2026, we had cash, cash equivalents and marketable securities totaling approximately $1.3 billion compared to approximately $4.2 billion as of December 31, 2025. The decrease in the balance was primarily due to the use of cash, cash equivalents and marketable securities to fund our acquisition of Apellis and subsequent settlement of its outstanding debt obligations, partially offset by the issuance of term loans and cash generated from operations.
Until required for another use in our business, we typically invest our cash reserves in bank deposits, certificates of deposit, commercial paper, corporate notes, U.S. and foreign government instruments, overnight reverse repurchase agreements and other interest-bearing marketable debt instruments in accordance with our investment policy. It is our policy to mitigate credit risk in our cash reserves and marketable securities by maintaining a well-diversified portfolio that limits the amount of exposure as to institution, maturity and investment type. We have experienced no significant limitations in our liquidity resulting from uncertainties in the banking sector.
For additional information on our collaboration arrangements, please read Note 18, Collaborative and Other Relationships, to our condensed consolidated financial statements included in this report .

CASH FLOW
The following table summarizes our cash flow activity:

  For the Six Months Ended June 30,
(In millions, except percentages) 2026 2025 % Change
Net cash flow provided by (used in) operating activities $ 1,094.4  $ 420.2  160.4  %
Net cash flow provided by (used in) investing activities (4,048.7) (104.3) nm
Net cash flow provided by (used in) financing activities 1,252.2  (34.7) nm

nm Not meaningful
OPERATING ACTIVITIES
Operating cash flow is derived by adjusting our net income for:
• non-cash operating items such as depreciation and amortization, impairment charges, unrealized (gain) loss on strategic investments and share-based compensation;
• changes in operating assets and liabilities, which reflect timing differences between the receipt and payment of cash associated with transactions and when they are recognized in results of operations; and
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• (gains) losses on the disposal of assets, deferred income taxes, changes in the fair value of contingent payments associated with our acquisitions of businesses and acquired in-process research and development.
For the six months ended June 30, 2026, compared to the same period in 2025, the increase in net cash flow provided by operating activities was primarily due to higher worldwide tax payments in 2025, compared to the same period in 2026. Net income in 2025 also included the $165.0 million upfront payment made to Stoke in connection with the closing of our collaboration and license agreement.
INVESTING ACTIVITIES
For the six months ended June 30, 2026, compared to the same period in 2025, the change in net cash flow in investing activities was primarily due to a $5.1 billion payment made in 2026 for our acquisition of Apellis, net of cash acquired. Additionally, in April 2026 we entered into a definitive agreement with TJ Bio to acquire TJ Bio's exclusive rights to felzartamab in the greater China region and made an upfront payment of $100.0 million during the second quarter of 2026.
FINANCING ACTIVITIES
For the six months ended June 30, 2026, compared to the same period in 2025, the change in net cash flow in financing activities was primarily due to the issuance of term loans totaling $2.0 billion under 2026 Term Loan which were used to partially fund our acquisition of Apellis, partially offset by a $200.0 million payment to settle a portion of the 2026 Term Loan and payments to settle debt obligations assumed from our Apellis acquisition totaling $496.7 million. Additionally, we borrowed $400.0 million under our revolving credit facility during the second quarter of 2026 and was repaid in full in June 2026.

CAPITAL RESOURCES
DEBT AND CREDIT FACILITIES
LONG-TERM DEBT AND TERM LOAN CREDIT AGREEMENTS
Our long-term obligations consist of our 2026 Term Loan and long-term debt related to our Senior Notes with final maturity dates ranging between 2030 and 2055. As of June 30, 2026, our outstanding balance related to long-term debt was $7.3 billion, net of discounts and debt offering costs.
In connection with our acquisition of Apellis we entered into a $2.0 billion term loan credit agreement. On the closing date of the Apellis acquisition we drew $2.0 billion from the 2026 Term Loan, comprised of a $1.0 billion floating rate 364-day tranche and a $1.0 billion floating rate two-year tranche. As of June 30, 2026, we had $1.8 billion outstanding under the term loan credit agreement, of which $800.0 million was outstanding under the 364-day tranche and $1.0 billion outstanding under the two-year tranche.
2024 REVOLVING CREDIT FACILITY
In August 2024 we entered into a $1.5 billion, five-year senior unsecured revolving credit facility under which we are permitted to draw funds for working capital and general corporate purposes. The terms of the revolving credit facility include a financial covenant that requires us not to exceed a maximum consolidated leverage ratio. We borrowed $400.0 million under our revolving credit facility during the second quarter of 2026 and this borrowing was repaid in full in June 2026. As of June 30, 2026 and December 31, 2025, we had no outstanding borrowings and were in compliance with all covenants under this facility.
For a summary of the fair and carrying values of our outstanding borrowings as of June 30, 2026 and December 31, 2025, please read Note 8, Fair Value Measurements, to our condensed consolidated financial statements included in this report.
For additional information on our credit facility please read Note 12, Indebtedness , to these condensed consolidated financial statements.
SHARE REPURCHASE PROGRAMS
In October 2020 our Board of Directors authorized our 2020 Share Repurchase Program, which is a program to repurchase up to $5.0 billion of our common stock. Our 2020 Share Repurchase Program does not have an expiration date. All shares repurchased under our 2020 Share Repurchase Program were retired. There were no share repurchases of our common stock during the three and six months ended June 30, 2026 and 2025. Approximately $2.1 billion remained available under our 2020 Share Repurchase Program as of June 30, 2026.
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CONTRACTUAL OBLIGATIONS AND OFF-BALANCE SHEET ARRANGEMENTS
CONTRACTUAL OBLIGATIONS
Our contractual obligations primarily consist of our obligations under non-cancellable operating leases, long-term debt obligations and defined benefit and other purchase obligations, excluding amounts related to uncertain tax positions, funding commitments, research and development funding arrangements with third parties, contingent development, regulatory and commercial milestone payments and contingent payments, as described below.
In addition, certain of our collaboration and licensing arrangements include royalty payment obligations. For additional information on our royalty payments please read, Note 22, Commitments and Contingencies , to our consolidated financial statements included in our 2025 Form 10-K.
In connection with our acquisition of Apellis in May 2026 we assumed additional contractual obligations related to operating lease commitments and royalty payments. Apellis entered into agreements to pay royalties on future sales which will cumulatively range in the low to mid single digits.
Aside from our new commitments related to Apellis, there have been no material changes in our contractual obligations since December 31, 2025.
CONTINGENT CONSIDERATION RELATED TO ACQUISITION OF BUSINESSES
In connection with our acquisition of Apellis in May 2026, each shareholder is entitled to one contractual, non-transferable contingent value right per share representing the right to receive contingent cash payments of up to an aggregate of $4.00 per share in cash, subject to the achievement of specified annual global net sales thresholds for SYFOVRE. For additional information on our acquisition of Apellis, please read Note 2, Acquisitions , to these condensed consolidated financial statements.
In connection with our acquisition of Alcyone in November 2025, w e may pay additional development and regulatory milestone payments to the former shareholders of Alcyone of up to a total of $75.0 million if approval is received for ThecaFlex DRx administration of SPINRAZA or other additional pipeline products.
In connection with our acquisition of HI-Bio in July 2024, we may make additional payments based upon the achievement of certain milestone events. We recognized the contingent consideration obligations associated with this acquisition at its fair value on the acquisition date and we revalue this obligation each reporting period. We may pay up to approximately $350.0 million in remaining milestones related to this acquisition. For additional information on our acquisition of HI-Bio, please read Note 2, Acquisitions , to our consolidated financial statements included in our 2025 Form 10-K.
CONTINGENT DEVELOPMENT, REGULATORY AND COMMERCIAL MILESTONE PAYMENTS
Based on our development plans as of June 30, 2026, we could make potential future milestone payments to third parties of up to approximately $7.9 billion, including approximately $1.0 billion in development milestones, approximately $0.9 billion in regulatory milestones and approximately $6.0 billion in commercial milestones, as part of our various collaborations, including licensing and development programs. Payments under these agreements generally become due and payable upon achievement of certain development, regulatory or commercial milestones. Because the achievement of these milestones was not considered probable as of June 30, 2026, such contingencies have not been recorded in our financial statements. Amounts related to contingent milestone payments are not considered contractual obligations as they are contingent on the successful achievement of certain development, regulatory or commercial milestones.
If certain research milestones are met, we may pay up to approximately $25.3 million in additional milestones in 2026 under our current agreements, excluding opt-in payments.
OTHER FUNDING COMMITMENTS
As of June 30, 2026, we have several ongoing clinical studies in various clinical trial stages. Our most significant clinical trial expenditures are to CROs. The contracts with CROs are generally cancellable, with notice, at our option. We recorded accrued expense of approximately $38.5 million in our condensed consolidated balance sheets for expenditures incurred by CROs as of June 30, 2026. We have approximately $627.6 million in cancellable future commitments based on existing CRO contracts as of June 30, 2026.
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TAX RELATED OBLIGATIONS
We exclude liabilities pertaining to uncertain tax positions from our summary of contractual obligations as we cannot make a reliable estimate of the period of cash settlement with the respective taxing authorities. As of June 30, 2026, we have approximately $145.2 million of liabilities associated with uncertain tax positions.

NEW ACCOUNTING STANDARDS
For a discussion of new accounting standards please read Note 1, Summary of Significant Accounting Policies, to our condensed consolidated financial statements included in this report.

CRITICAL ACCOUNTING ESTIMATES
The preparation of our condensed consolidated financial statements, which have been prepared in accordance with U.S. GAAP, requires us to make estimates, judgments and assumptions that may affect the reported amounts of assets, liabilities, equity, revenue and expense and related disclosure of contingent assets and liabilities. On an ongoing basis we evaluate our estimates, judgments and assumptions. We base our estimates on historical experience and on various other assumptions that we believe are reasonable, the results of which form the basis for making judgments about the carrying values of assets, liabilities and equity and the amount of revenue and expense. Actual results may differ from these estimates.
There have been no material changes to our critical accounting estimates since our 2025 Form 10-K. For a discussion of our other critical accounting estimates, please read Part II, Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2025 Form 10-K.

ITEM 3.    QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are subject to certain risks that may affect our results of operations, cash flow and fair values of assets and liabilities, including volatility in foreign currency exchange rates, interest rate movements and equity price exposure as well as changes in economic conditions in the markets in which we operate as a result of the conflict between Russia and Ukraine and the military conflict in the Middle East. We manage the impact of foreign currency exchange rates and interest rates through various financial instruments, including derivative instruments such as foreign currency forward contracts, foreign currency options, interest rate lock contracts and interest rate swap contracts. We do not enter into financial instruments for trading or speculative purposes. The counterparties to these contracts are major financial institutions, and there is no significant concentration of exposure with any one counterparty.
FOREIGN CURRENCY EXCHANGE RISK
Our results of operations are subject to foreign currency exchange rate fluctuations due to the global nature of our operations. As a result, our consolidated financial position, results of operations and cash flow can be affected by market fluctuations in foreign currency exchange rates, primarily with respect to the Euro, British pound sterling, Canadian dollar, Swiss franc and the Polish zloty.
While the financial results of our global activities are reported in U.S. dollars, the functional currency for most of our foreign subsidiaries is their respective local currency. Fluctuations in the foreign currency exchange rates of the countries in which we do business will affect our operating results, often in ways that are difficult to predict. In particular, as the U.S. dollar strengthens versus other currencies, the value of the non-U.S. revenue will decline when reported in U.S. dollars. The impact to net income as a result of a strengthening U.S. dollar will be partially mitigated by the value of non-U.S. expense, which will also decline when reported in U.S. dollars. As the U.S. dollar weakens versus other currencies, the value of the non-U.S. revenue and expense will increase when reported in U.S. dollars.
We have established revenue and operating expense hedging and balance sheet risk management programs to protect against volatility of future foreign currency cash flow and changes in fair value caused by volatility in foreign currency exchange rates.
During the second quarter of 2018 the International Practices Task Force of the Center for Audit Quality categorized Argentina as a country with a projected three-year cumulative inflation rate greater than 100.0%, which indicated that Argentina's economy is highly inflationary. This categorization did not have a material impact on our results of operations or financial position as of June 30, 2026, and is not expected to have a material impact on our results of operations or financial position in the future.
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REVENUE AND OPERATING EXPENSE HEDGING PROGRAM
Our foreign currency hedging program is designed to mitigate, over time, a portion of the impact resulting from volatility in exchange rate changes on revenue and operating expense. We use foreign currency forward contracts and foreign currency options to manage foreign currency risk, with the majority of our forward contracts and options used to hedge certain forecasted revenue and operating expense transactions denominated in foreign currencies in the next 18 months. We do not engage in currency speculation. For a more detailed disclosure of our revenue and operating expense hedging program, please read Note 10, Derivative Instruments, to our condensed consolidated financial statements included in this report.
Our ability to mitigate the impact of foreign currency exchange rate changes on revenue and net income diminishes as significant foreign currency exchange rate fluctuations are sustained over extended periods of time. In particular, devaluation or significant deterioration of foreign currency exchange rates are difficult to mitigate and likely to negatively impact earnings. The cash flow from these contracts are reported as operating activities in our condensed consolidated statements of cash flow.
BALANCE SHEET RISK MANAGEMENT HEDGING PROGRAM
We also use forward contracts to mitigate the foreign currency exposure related to certain balance sheet items. The primary objective of our balance sheet risk management program is to mitigate the exposure of foreign currency denominated net monetary assets and liabilities of foreign affiliates. In these instances, we principally utilize currency forward contracts. We have not elected hedge accounting for the balance sheet related items. The cash flow from these contracts are reported as operating activities in our condensed consolidated statements of cash flow.
The following quantitative information includes the impact of currency movements on forward contracts used in our revenue, operating expense and balance sheet hedging programs. As of June 30, 2026 and December 31, 2025, a hypothetical adverse 10.0% movement in foreign currency exchange rates compared to the U.S. dollar across all maturities would result in a hypothetical decrease in the fair value of forward contracts of approximately $243.0 million and $278.0 million, respectively. The estimated fair value change was determined by measuring the impact of the hypothetical exchange rate movement on outstanding forward contracts. Our use of this methodology to quantify the market risk of such instruments is subject to assumptions and the actual impact could be significantly different. The quantitative information about market risk is limited because it does not take into account all foreign currency operating transactions.
CREDIT RISK
Financial instruments that potentially subject us to concentrations of credit risk include cash and cash equivalents, investments, derivatives and accounts receivable. We attempt to minimize the risks related to cash and cash equivalents and investments by investing in a broad and diverse range of financial instruments. We have established guidelines related to credit ratings and maturities intended to safeguard principal balances and maintain liquidity. Our investment portfolio is maintained in accordance with our investment policy, which defines allowable investments, specifies credit quality standards and limits the credit exposure of any single issuer. We minimize credit risk resulting from derivative instruments by choosing only highly rated financial institutions as counterparties.
We operate in certain countries where weakness in economic conditions, including the effects of the conflict between Russia and Ukraine and the military conflict in the Middle East, can result in extended collection periods. We continue to monitor these conditions, including the volatility associated with international economies and the relevant financial markets, and assess their possible impact on our business. To date, we have not experienced any significant losses with respect to the collection of our accounts receivable.
We believe that our allowance for doubtful accounts was adequate as of June 30, 2026 and December 31, 2025.
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ITEM 4.     CONTROLS AND PROCEDURES
DISCLOSURE CONTROLS AND PROCEDURES AND INTERNAL CONTROL OVER FINANCIAL REPORTING
CONTROLS AND PROCEDURES
We have carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) or 15d-15(e) under the Securities Exchange Act of 1934, as amended), as of June 30, 2026. Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures are effective in ensuring that:
(a) the information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act is recorded, processed, summarized and reported within the time periods specified in the U.S. Securities and Exchange Commission’s rules and forms; and
(b) such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
In designing and evaluating our disclosure controls and procedures, our management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.
CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING
On May 14, 2026, we completed our acquisition of Apellis. The Apellis acquisition was accounted for as a business combination using the acquisition method of accounting. The results of operations of the acquired Apellis business have been included in our results of operations since May 14, 2026.
While we are currently in the process of evaluating and integrating Apellis' historical internal controls over financial reporting with ours, there were no changes in our internal control over financial reporting during the quarter ended June 30, 2026, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
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PART II OTHER INFORMATION

ITEM 1.    LEGAL PROCEEDINGS
For a discussion of legal proceedings as of June 30, 2026, please read Note 20, Litigation, to our condensed consolidated financial statements included in this report, which is incorporated into this item by reference.

ITEM 1A.    RISK FACTORS
Risks Related to Our Business
We are substantially dependent on revenue from our products.
Our revenue depends upon continued sales of our products as well as the financial rights we have in our anti-CD20 therapeutic programs. A significant portion of our revenue is concentrated on sales of our products in increasingly competitive markets. Any of the following negative developments relating to any of our products or any of our anti-CD20 therapeutic programs may adversely affect our revenue and results of operations or our stock price:
• the introduction, greater acceptance or more favorable reimbursement of competing products, including new originator therapies, generics, prodrugs and biosimilars of existing products and products approved under abbreviated regulatory pathways;
• safety or efficacy issues;
• limitations and additional pressures on product pricing or price increases, including those relating to inflation and those resulting from governmental or regulatory requirements, including those relating to any future potential drug price negotiation under the IRA or other legislative or executive acts; increased competition, including from generic or biosimilar versions of our products; or changes in, or implementation of, reimbursement policies and practices of payors and other third parties;
• adverse legal, administrative, geopolitical, regulatory or legislative developments; and
• our ability to maintain a positive reputation among patients, healthcare providers and others, which may be impacted by our pricing and reimbursement decisions.
We have many products in the stages of ongoing commercial launch in the U.S. and certain international markets. LEQEMBI continues to expand its commercial presence in the U.S. and certain international markets and SKYCLARYS is in the early stages of commercial launch in certain European markets. In addition to risks associated with new product launches and the other factors described in these Risk Factors, Biogen’s and Eisai’s ability to successfully commercialize LEQEMBI and our ability to successfully commercialize SKYCLARYS may be adversely affected due to:
• Eisai’s ability to obtain and maintain adequate reimbursement for LEQEMBI;
• the effectiveness of Eisai's and Biogen’s commercial strategy for marketing LEQEMBI;
• requirements such as participation in a registry and the use of imaging or other diagnostics for LEQEMBI;
• our ability to obtain approval in other markets;
• the approval and/or greater acceptance of other new products for the same or similar indications;
• Eisai’s and Biogen’s ability to maintain a positive reputation among patients, healthcare providers and others in the Alzheimer’s disease community, which may be impacted by pricing and reimbursement decisions relating to LEQEMBI, which are made by Eisai and/or third parties;
• Biogen's ability to obtain and maintain adequate reimbursement for SKYCLARYS; and
• the effectiveness of Biogen's commercial strategy for marketing SKYCLARYS.
Our long-term success depends upon the successful development of new products and additional indications for our existing products.
Our long-term success depends upon the successful development of new products from our research and development activities or our licenses or acquisitions from third parties, as well as the development of additional indications for our existing products. Product development is very expensive and involves a high degree of uncertainty and risk and is not always successful. Only a small number of research and development programs result in the commercialization of a product. It is difficult to predict the success and the time and cost of product development of novel approaches for the treatment of diseases. The development of novel approaches for the treatment of diseases, including development efforts in new modalities such as those based on the ASO platform, presents additional challenges and risks, including obtaining approval from regulatory authorities that have limited
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experience with the development of such therapies. For example, we are currently seeking approval of a subcutaneous formulation of LEQEMBI as a starting dose in the U.S. and any delays or challenges may impact our ability to realize the anticipated benefits from LEQEMBI.
Clinical trial data are subject to differing interpretations and even if we view data as sufficient to support the safety, effectiveness and/or approval of a product candidate, regulatory authorities may disagree and may require additional data, limit the scope of the approval or deny approval altogether. Furthermore, the approval of a product candidate by one regulatory agency does not mean that other regulatory agencies will also approve such product candidate.
Success in preclinical work or early stage clinical trials does not ensure that later stage or larger scale clinical trials will be successful. Clinical trials may indicate that our product candidates lack efficacy, have harmful side effects, result in unexpected adverse events or raise other concerns that may significantly reduce or delay the likelihood of regulatory approval. This may result in terminated programs, significant restrictions on use, safety warnings in an approved label, adverse placement within the treatment paradigm or significant reduction in the commercial potential of the product candidate.
Even if we could successfully develop new products or additional indications for our existing products, we may make a strategic decision to discontinue development of a product candidate or an additional indication for our existing products if, for example, we believe commercialization will be difficult relative to the standard of care or we prioritize other opportunities in our pipeline.
If we fail to compete effectively, our business and market position would suffer.
The biopharmaceutical industry and the markets in which we operate are intensely competitive. We compete in the marketing and sale of our products, the development of new products and processes, the acquisition of rights to new products with commercial potential and the hiring and retention of personnel. We compete with companies that have a greater number of products on the market and in the product pipeline, substantially greater financial, marketing, research and development and other resources and other technological or competitive advantages.
Our products continue to face increasing competition from the introduction of new originator therapies, generics, prodrugs and biosimilars of existing products and products approved under abbreviated regulatory pathways. Some of these products are likely to be sold at substantially lower prices than our branded products. The introduction of such products as well as other lower-priced competing products has in the past reduced, and may in the future significantly reduce, both the price that we are able to charge for our products and the volume of products we sell, which has and may continue to negatively impact our revenue. In addition, in some markets, when a generic or biosimilar version of one of our products is commercialized, it has in the past and may in the future be automatically substituted for our product and significantly reduce our revenue in a short period of time.
Our ability to compete, maintain and grow our business may be adversely affected by a number of factors, including:
• the introduction of other products, including products that may be more efficacious, safer, less expensive or more convenient alternatives to our products, including our own products and products of our collaborators;
• the off-label use by physicians of therapies indicated for other conditions to treat patients;
• patient dynamics, including the size of the patient population and our ability to identify, attract and maintain new and current patients to our therapies;
• the reluctance of physicians to prescribe, and patients to use, our products without additional data on the efficacy and safety of such products;
• damage to physician and patient confidence in any of our products, generic or biosimilars of our products or any other product from the same class as one of our products, or to our sales and reputation as a result of label changes, pricing and reimbursement decisions or adverse experiences or events that may occur with patients treated with our products or generic or biosimilars of our products;
• inability to obtain and maintain appropriate pricing and adequate reimbursement for our products compared to our competitors in key markets; and
• our ability to obtain and maintain patent, data or market exclusivity for our products.
Our business may be adversely affected if we do not successfully execute or realize the anticipated benefits of our strategic and growth initiatives.
The successful execution of our strategic and growth initiatives depends upon internal development projects, commercial initiatives and external opportunities, which may include the acquisition and in-licensing of products, technologies, companies, the entry into strategic alliances and collaborations, as well as our ability to execute on strategic decisions and initiatives.
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While we believe we have a number of promising programs in our pipeline, failure or delay of internal development projects to advance or difficulties in executing on our commercial initiatives could impact our current and future growth, resulting in additional reliance on external development opportunities for growth.
Supporting the further development of our existing products and potential new products in our pipeline will require significant capital expenditures and management resources, including investments in research and development, sales and marketing, manufacturing capabilities and other areas of our business.
We have made, and may continue to make, significant operating and capital expenditures for potential new products prior to regulatory approval with no assurance that such investment will be recouped, which may adversely affect our financial condition, business and operations.
The availability of high quality, fairly valued external product development is limited and the opportunity to acquire or in-license is highly competitive. As such, we are not certain that we will be able to identify suitable candidates for acquisition or in-licensing or if we will be able to reach agreement to make any such acquisition or in-license if suitable candidates are identified.
We may fail to initiate or complete transactions for many reasons, including failure to obtain regulatory or other approvals as well as a result of disputes or litigation. Furthermore, we may not be able to achieve the full strategic and financial benefits expected to result from transactions, collaborations or strategic decisions, such as the decision to retain the biosimilars business, or the benefits may be delayed or not occur at all. We may also face additional costs or liabilities in completed transactions that were not contemplated prior to completion.
Any failure in the execution of a transaction, in the integration of an acquired asset or business or in achieving expected synergies could result in slower growth, higher than expected costs, the recording of asset impairment charges and other actions which could adversely affect our business, financial condition and results of operations. For example, in May 2026, we completed our acquisition of Apellis, which became a wholly-owned subsidiary. Our ability to realize the anticipated benefits of the acquisition depends on, among other things, how efficiently and effectively we are able to integrate Apellis’ operations into ours and to commercialize EMPAVELI and SYFOVRE.
Sales of our products depend, to a significant extent, on the availability and extent of adequate coverage, pricing and reimbursement from government health administration authorities, private health insurers and other organizations, which are subject to increasing and intense pressure from political, social, competitive and other sources. Our inability to obtain and maintain adequate coverage, or a reduction in pricing or reimbursement, could have an adverse effect on our business, reputation, revenue and results of operations.
Sales of our products depend, to a significant extent, on the availability and extent of adequate coverage, pricing and reimbursement from governmental health administration authorities, private health insurers and other organizations. When a new pharmaceutical product is approved, the availability of government and private reimbursement for that product, diagnosis of the condition it treats and the cost to administer it may be uncertain, as is the pricing and amount for which that product will be reimbursed.
Pricing and reimbursement for our products may be adversely affected by a number of factors, including:
• changes in, and implementation of, federal, state or foreign government regulations or private third-party payors’ reimbursement policies;
• pressure by employers on private health insurance plans to reduce costs;
• consolidation and increasing assertiveness of governmental health administration authorities, private health insurers and other organizations seeking price discounts or rebates in connection with the placement of our products on their formularies and, in some cases, the imposition of restrictions on access or coverage of particular drugs or pricing determined based on perceived value;
• our ability to receive reimbursement for our products or our ability to receive comparable reimbursement to that of competing products; and
• our value-based contracting program pursuant to which we aim to tie the pricing of our products to their clinical values by either aligning price to patient outcomes or adjusting price for patients who discontinue therapy for any reason, including efficacy or tolerability concerns.
Our ability to set the price for our products varies significantly from country to country and, as a result, so can the price of our products. Governments may use a variety of cost-containment measures to control the cost of products, including price cuts, mandatory rebates, value-based pricing and reference pricing (i.e., referencing prices in other countries and using those reference prices to set a price). Drug prices are under significant scrutiny in the markets in which our products are prescribed; for example the IRA has certain provisions related to drug pricing, including the ability for the U.S. government to set prices for certain drugs in Medicare. We expect drug pricing and other healthcare costs to continue to be subject to political or societal pressures on a global basis. Certain countries set
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prices by reference to the prices in other countries where our products are marketed. Our inability to obtain and maintain adequate prices in a particular country has limited, and may in the future limit, the revenue from our products within that country and has, and may in the future, also adversely affect our ability to secure acceptable prices in existing and potential new markets, which has limited, and may in the future limit, market growth and result in reductions in revenue. This has created, or may create, the opportunity for third-party cross-border trade or influence our decision to sell or not to sell a product, thus adversely affecting our geographic expansion plans and revenue. Additionally, in certain jurisdictions governmental health agencies are permitted to adjust, retroactively and/or prospectively, reimbursement rates for our products. Reimbursement for our products by governments, including the timing of any reimbursements, are also affected by budgetary or political constraints, particularly in challenging economic environments. Government agencies often do not set their own budgets and therefore, have limited control over the amount of money they can spend. In addition, these agencies experience political pressure that dictate the manner in which they spend money. There can be no assurance that the economic, budgeting or political issues will not worsen and adversely impact sales or reimbursements of our products.
Competition from current and future competitors has and may continue to negatively impact our ability to maintain pricing and our market share. New products marketed by our competitors have caused and could continue to cause our revenue to decrease due to potential price reductions and lower sales volumes. Additionally, the introduction of generic or biosimilar versions of our products, follow-on products, prodrugs or products approved under abbreviated regulatory pathways has and may continue to significantly reduce the price and the volume of products we sell.
Many third-party payors continue to adopt benefit plan changes that shift a greater portion of prescription costs to patients, including more limited benefit plan designs, higher patient co-pay or co-insurance obligations and limitations on patients' use of commercial manufacturer co-pay payment assistance programs (including through co-pay accumulator adjustment or maximization programs). Significant consolidation in the health insurance industry has resulted in a few large insurers and pharmacy benefit managers exerting greater pressure in pricing and usage negotiations with drug manufacturers, significantly increasing discounts and rebates required of manufacturers and limiting patient access and usage. Further consolidation among insurers, pharmacy benefit managers and other payors would increase the negotiating leverage such entities have over us and other drug manufacturers. Additional discounts, rebates, coverage or plan changes, restrictions or exclusions as described above could have a material adverse effect on sales of our affected products.
Our failure to obtain or maintain adequate coverage, pricing or reimbursement for our products could have an adverse effect on our business, reputation, revenue and results of operations, could curtail or eliminate our ability to adequately fund research and development programs and/or could cause a decline or volatility in our stock price.
We depend on relationships with collaborators and other third parties for revenue, and for the development, regulatory approval, commercialization and marketing of certain of our products and product candidates, which are outside of our full control, and if these relationships fail, our business may be adversely affected.
We rely on a number of collaborative and other third-party relationships for revenue and the development, regulatory approval, commercialization and marketing of certain of our products and product candidates. We also outsource certain aspects of our regulatory affairs and clinical development relating to our products and product candidates to third parties. Reliance on third parties subjects us to a number of risks, including:
• we may be unable to control the resources our collaborators or third parties devote to our programs, products or product candidates, which may affect our ability to achieve development goals or milestones;
• disputes may arise under an agreement, including with respect to the achievement and payment of milestones, payment of development or commercial costs, ownership of rights to technology developed and the underlying agreement may fail to provide us with significant protection or may fail to be effectively enforced if the collaborators or third parties fail to perform;
• the interests of our collaborators or third parties may not always align with our interests, and such parties may not protect and enforce any intellectual property rights or pursue regulatory approvals or market a product in the same manner or to the same extent that we would, which could adversely affect our revenue, or may adopt tax strategies that could have an adverse effect on our business, results of operations or financial condition;
• the inability of the parties to cooperate effectively, which could adversely affect product sales or the clinical development or regulatory approvals of product candidates under joint control, could result in termination of the research, development or commercialization of product candidates or could result in litigation or arbitration;
• any failure on the part of our collaborators or third parties to comply with applicable laws, including tax laws, regulatory requirements and/or applicable contractual obligations or to fulfill any responsibilities they may have to protect and enforce any intellectual property rights underlying our products could have an adverse effect on our revenue or reputation as well as involve us in possible legal proceedings;
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