FORM 10-Q
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(Mark One)
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(X)
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the quarterly period ended
March 31, 2016
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OR
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( )
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
||
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For the transition period from __________ to __________
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Commission File Number
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0-19034
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New York
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13-3444607
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(State or other jurisdiction of
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(I.R.S. Employer Identification No.)
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incorporation or organization)
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777 Old Saw Mill River Road, Tarrytown, New York
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10591-6707
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(Address of principal executive offices)
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(Zip Code)
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Yes
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X
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No
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Yes
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X
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No
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Large accelerated filer
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X
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Accelerated filer
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Non-accelerated filer
|
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(Do not check if a smaller reporting company)
|
Smaller reporting company
|
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Yes
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No
|
X
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Class of Common Stock
|
|
Number of Shares
|
Class A Stock, $.001 par value
|
|
1,913,136
|
Common Stock, $.001 par value
|
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103,165,457
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Page Numbers
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"ARCALYST
®
", "EYLEA
®
", "ZALTRAP
®
", "
VelocImmune
®
", "
VelociGene
®
", "
VelociMouse
®
", "
VelociMab
®
", and "
VelociSuite
®
" are trademarks of Regeneron Pharmaceuticals, Inc. Trademarks and trade names of other companies appearing in this report are, to the knowledge of Regeneron Pharmaceuticals, Inc., the property of their respective owners.
|
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March 31,
|
|
December 31,
|
||||
|
2016
|
|
2015
|
||||
ASSETS
|
|||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
604,214
|
|
|
$
|
809,102
|
|
Marketable securities
|
244,965
|
|
|
236,121
|
|
||
Accounts receivable - trade, net
|
1,450,572
|
|
|
1,152,489
|
|
||
Accounts receivable from Sanofi
|
173,782
|
|
|
153,152
|
|
||
Accounts receivable from Bayer
|
240,867
|
|
|
162,152
|
|
||
Inventories
|
303,294
|
|
|
238,578
|
|
||
Prepaid expenses and other current assets
|
115,685
|
|
|
163,501
|
|
||
Total current assets
|
3,133,379
|
|
|
2,915,095
|
|
||
|
|
|
|
||||
Marketable securities
|
555,210
|
|
|
632,162
|
|
||
Property, plant, and equipment, net
|
1,666,391
|
|
|
1,594,120
|
|
||
Deferred tax assets
|
543,689
|
|
|
461,945
|
|
||
Other assets
|
5,791
|
|
|
5,810
|
|
||
Total assets
|
$
|
5,904,460
|
|
|
$
|
5,609,132
|
|
|
|
|
|
||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|||||||
Current liabilities:
|
|
|
|
||||
Accounts payable and accrued expenses
|
$
|
733,276
|
|
|
$
|
644,112
|
|
Deferred revenue from Sanofi, current portion
|
99,314
|
|
|
101,573
|
|
||
Deferred revenue - other, current portion
|
73,626
|
|
|
51,914
|
|
||
Other current liabilities
|
13,508
|
|
|
13,563
|
|
||
Total current liabilities
|
919,724
|
|
|
811,162
|
|
||
|
|
|
|
||||
Deferred revenue from Sanofi
|
565,773
|
|
|
582,664
|
|
||
Deferred revenue - other
|
170,658
|
|
|
82,015
|
|
||
Facility lease obligations
|
362,230
|
|
|
362,919
|
|
||
Other long-term liabilities
|
120,993
|
|
|
115,535
|
|
||
Total liabilities
|
2,139,378
|
|
|
1,954,295
|
|
||
|
|
|
|
||||
Stockholders' equity:
|
|
|
|
||||
Preferred stock, $.01 par value; 30,000,000 shares authorized; issued and outstanding - none
|
—
|
|
|
—
|
|
||
Class A Stock, convertible, $.001 par value; 40,000,000 shares authorized; shares issued and outstanding - 1,913,136 in 2016 and 1,913,776 in 2015
|
2
|
|
|
2
|
|
||
Common Stock, $.001 par value; 320,000,000 shares authorized; shares issued - 106,739,966 in 2016 and 106,378,001 in 2015
|
107
|
|
|
106
|
|
||
Additional paid-in capital
|
3,049,651
|
|
|
3,099,526
|
|
||
Retained earnings
|
1,018,436
|
|
|
852,700
|
|
||
Accumulated other comprehensive income
|
4,364
|
|
|
8,572
|
|
||
Treasury stock, at cost; 3,659,588 shares in 2016 and 3,642,820 in 2015
|
(307,478
|
)
|
|
(306,069
|
)
|
||
Total stockholders' equity
|
3,765,082
|
|
|
3,654,837
|
|
||
Total liabilities and stockholders' equity
|
$
|
5,904,460
|
|
|
$
|
5,609,132
|
|
|
|
|
|
||||
The accompanying notes are an integral part of the financial statements.
|
|
|
Three Months Ended
March 31,
|
||||||
|
|
2016
|
|
2015
|
||||
Statements of Operations
|
|
|
|
|
||||
Revenues:
|
|
|
|
|
||||
Net product sales
|
|
$
|
784,182
|
|
|
$
|
544,573
|
|
Sanofi collaboration revenue
|
|
219,694
|
|
|
173,356
|
|
||
Bayer collaboration revenue
|
|
179,592
|
|
|
123,846
|
|
||
Other revenue
|
|
17,381
|
|
|
27,837
|
|
||
|
|
1,200,849
|
|
|
869,612
|
|
||
|
|
|
|
|
||||
Expenses:
|
|
|
|
|
||||
Research and development
|
|
470,112
|
|
|
343,113
|
|
||
Selling, general, and administrative
|
|
289,677
|
|
|
158,991
|
|
||
Cost of goods sold
|
|
78,942
|
|
|
42,570
|
|
||
Cost of collaboration and contract manufacturing
|
|
32,810
|
|
|
41,385
|
|
||
|
|
871,541
|
|
|
586,059
|
|
||
|
|
|
|
|
||||
Income from operations
|
|
329,308
|
|
|
283,553
|
|
||
|
|
|
|
|
||||
Other income (expense):
|
|
|
|
|
||||
Investment income
|
|
2,249
|
|
|
180
|
|
||
Interest and other expense, net
|
|
(1,406
|
)
|
|
(7,210
|
)
|
||
|
|
843
|
|
|
(7,030
|
)
|
||
|
|
|
|
|
||||
Income before income taxes
|
|
330,151
|
|
|
276,523
|
|
||
|
|
|
|
|
||||
Income tax expense
|
|
(164,415
|
)
|
|
(200,502
|
)
|
||
|
|
|
|
|
||||
Net income
|
|
$
|
165,736
|
|
|
$
|
76,021
|
|
|
|
|
|
|
||||
Net income per share - basic
|
|
$
|
1.59
|
|
|
$
|
0.74
|
|
Net income per share - diluted
|
|
$
|
1.45
|
|
|
$
|
0.66
|
|
|
|
|
|
|
||||
Weighted average shares outstanding - basic
|
|
104,290
|
|
|
102,227
|
|
||
Weighted average shares outstanding - diluted
|
|
114,228
|
|
|
114,519
|
|
||
|
|
|
|
|
||||
Statements of Comprehensive Income
|
|
|
|
|
||||
Net income
|
|
$
|
165,736
|
|
|
$
|
76,021
|
|
Other comprehensive income (loss):
|
|
|
|
|
||||
Unrealized loss on marketable securities, net of tax
|
|
(4,208
|
)
|
|
(4,347
|
)
|
||
Comprehensive income
|
|
$
|
161,528
|
|
|
$
|
71,674
|
|
|
|
|
|
|
||||
The accompanying notes are an integral part of the financial statements.
|
|
|
Three Months Ended
March 31,
|
||||||
|
|
2016
|
|
2015
|
||||
Cash flows from operating activities:
|
|
|
|
|
||||
Net income
|
|
$
|
165,736
|
|
|
$
|
76,021
|
|
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
22,977
|
|
|
16,027
|
|
||
Non-cash compensation expense
|
|
142,250
|
|
|
103,759
|
|
||
Other non-cash charges and expenses, net
|
|
3,957
|
|
|
8,808
|
|
||
Deferred taxes
|
|
(79,785
|
)
|
|
(37,256
|
)
|
||
Changes in assets and liabilities:
|
|
|
|
|
||||
Increase in Sanofi, Bayer, and trade accounts receivable
|
|
(397,428
|
)
|
|
(329,746
|
)
|
||
Increase in inventories
|
|
(62,263
|
)
|
|
(5,434
|
)
|
||
Decrease in prepaid expenses and other assets
|
|
39,260
|
|
|
43,434
|
|
||
Increase (decrease) in deferred revenue
|
|
91,205
|
|
|
(7,457
|
)
|
||
Increase in accounts payable, accrued expenses, and other liabilities
|
|
103,431
|
|
|
30,117
|
|
||
Total adjustments
|
|
(136,396
|
)
|
|
(177,748
|
)
|
||
Net cash provided by (used in) operating activities
|
|
29,340
|
|
|
(101,727
|
)
|
||
|
|
|
|
|
||||
Cash flows from investing activities:
|
|
|
|
|
||||
Purchases of marketable securities
|
|
—
|
|
|
(95,775
|
)
|
||
Sales or maturities of marketable securities
|
|
60,409
|
|
|
80,456
|
|
||
Capital expenditures
|
|
(104,094
|
)
|
|
(114,162
|
)
|
||
Net cash used in investing activities
|
|
(43,685
|
)
|
|
(129,481
|
)
|
||
|
|
|
|
|
||||
Cash flows from financing activities:
|
|
|
|
|
||||
(Payments) proceeds in connection with facility lease obligations
|
|
(598
|
)
|
|
6,738
|
|
||
Repayments of convertible senior notes
|
|
(1,739
|
)
|
|
(16,686
|
)
|
||
Payments in connection with reduction of outstanding warrants
|
|
(242,117
|
)
|
|
(124,531
|
)
|
||
Proceeds from issuance of Common Stock
|
|
39,304
|
|
|
76,273
|
|
||
Payments in connection with Common Stock tendered for employee tax obligations
|
|
(1,042
|
)
|
|
(21,192
|
)
|
||
Excess tax benefit from stock-based compensation
|
|
15,649
|
|
|
169,794
|
|
||
Net cash (used in) provided by financing activities
|
|
(190,543
|
)
|
|
90,396
|
|
||
|
|
|
|
|
||||
Net decrease in cash and cash equivalents
|
|
(204,888
|
)
|
|
(140,812
|
)
|
||
|
|
|
|
|
||||
Cash and cash equivalents at beginning of period
|
|
809,102
|
|
|
648,719
|
|
||
|
|
|
|
|
||||
Cash and cash equivalents at end of period
|
|
$
|
604,214
|
|
|
$
|
507,907
|
|
|
|
|
|
|
||||
The accompanying notes are an integral part of the financial statements.
|
|
Rebates &
Chargebacks
|
|
Distribution-
Related
Fees
|
|
Other Sales-
Related
Deductions
|
|
Total
|
||||||||
Balance as of December 31, 2015
|
$
|
6,419
|
|
|
$
|
48,313
|
|
|
$
|
517
|
|
|
$
|
55,249
|
|
Provision related to current period sales
|
18,885
|
|
|
35,788
|
|
|
2,910
|
|
|
57,583
|
|
||||
Credits/payments
|
(17,457
|
)
|
|
(50,353
|
)
|
|
(2,557
|
)
|
|
(70,367
|
)
|
||||
Balance as of March 31, 2016
|
$
|
7,847
|
|
|
$
|
33,748
|
|
|
$
|
870
|
|
|
$
|
42,465
|
|
|
|
|
|
|
|
|
|
||||||||
Balance as of December 31, 2014
|
$
|
3,083
|
|
|
$
|
21,166
|
|
|
$
|
532
|
|
|
$
|
24,781
|
|
Provision related to current period sales
|
11,353
|
|
|
24,781
|
|
|
1,383
|
|
|
37,517
|
|
||||
Credits/payments
|
(9,779
|
)
|
|
(13,036
|
)
|
|
(1,411
|
)
|
|
(24,226
|
)
|
||||
Balance as of March 31, 2015
|
$
|
4,657
|
|
|
$
|
32,911
|
|
|
$
|
504
|
|
|
$
|
38,072
|
|
|
|
Three Months Ended
March 31,
|
||||||
Sanofi Collaboration Revenue
|
|
2016
|
|
2015
|
||||
Antibody:
|
|
|
|
|
||||
Reimbursement of Regeneron research and development expenses
|
|
$
|
193,602
|
|
|
$
|
168,820
|
|
Reimbursement of Regeneron commercialization-related expenses
|
|
73,274
|
|
|
8,458
|
|
||
Regeneron's share of losses in connection with commercialization of antibodies
|
|
(99,422
|
)
|
|
(22,405
|
)
|
||
Other
|
|
2,965
|
|
|
2,561
|
|
||
Total Antibody
|
|
170,419
|
|
|
157,434
|
|
||
Immuno-oncology:
|
|
|
|
|
||||
Reimbursement of Regeneron research and development expenses
|
|
29,275
|
|
|
—
|
|
||
Other
|
|
20,000
|
|
|
—
|
|
||
Total Immuno-oncology
|
|
49,275
|
|
|
—
|
|
||
ZALTRAP
®
:
|
|
|
|
|
||||
Reimbursement of Regeneron research and development expenses
|
|
—
|
|
|
686
|
|
||
Other
|
|
—
|
|
|
15,236
|
|
||
Total ZALTRAP
|
|
—
|
|
|
15,922
|
|
||
|
|
$
|
219,694
|
|
|
$
|
173,356
|
|
|
|
Three Months Ended
March 31,
|
||||||
Bayer Collaboration Revenue
|
|
2016
|
|
2015
|
||||
EYLEA:
|
|
|
|
|
||||
Regeneron's net profit in connection with commercialization of EYLEA outside the United States
|
|
$
|
145,835
|
|
|
$
|
89,426
|
|
Sales milestones
|
|
—
|
|
|
15,000
|
|
||
Cost-sharing of Regeneron EYLEA development expenses
|
|
2,743
|
|
|
2,657
|
|
||
Other
|
|
26,492
|
|
|
12,912
|
|
||
Total EYLEA
|
|
175,070
|
|
|
119,995
|
|
||
PDGFR-beta antibody:
|
|
|
|
|
||||
Cost-sharing of rinucumab/aflibercept (REGN2176-3) development expenses
|
|
1,896
|
|
|
1,254
|
|
||
Other
|
|
2,626
|
|
|
2,597
|
|
||
Total PDGFR-beta
|
|
4,522
|
|
|
3,851
|
|
||
|
|
$
|
179,592
|
|
|
$
|
123,846
|
|
|
|
Three Months Ended
March 31, |
||||||
|
|
2016
|
|
2015
|
||||
Net income - basic
|
|
$
|
165,736
|
|
|
$
|
76,021
|
|
Effect of dilutive securities:
|
|
|
|
|
||||
Convertible senior notes - interest expense related to contractual coupon interest rate and amortization of discount and note issuance costs
|
|
56
|
|
|
—
|
|
||
Net income - diluted
|
|
$
|
165,792
|
|
|
$
|
76,021
|
|
|
|
|
|
|
||||
(Shares in thousands)
|
|
|
|
|
||||
Weighted average shares - basic
|
|
104,290
|
|
|
102,227
|
|
||
Effect of dilutive securities:
|
|
|
|
|
||||
Stock options
|
|
8,147
|
|
|
9,313
|
|
||
Restricted stock
|
|
469
|
|
|
467
|
|
||
Convertible senior notes
|
|
44
|
|
|
—
|
|
||
Warrants
|
|
1,278
|
|
|
2,512
|
|
||
Dilutive potential shares
|
|
9,938
|
|
|
12,292
|
|
||
Weighted average shares - diluted
|
|
114,228
|
|
|
114,519
|
|
||
|
|
|
|
|
||||
Net income per share - basic
|
|
$
|
1.59
|
|
|
$
|
0.74
|
|
Net income per share - diluted
|
|
$
|
1.45
|
|
|
$
|
0.66
|
|
|
|
Three Months Ended March 31,
|
||||
(Shares in thousands)
|
|
2016
|
|
2015
|
||
Stock options
|
|
7,539
|
|
|
3,673
|
|
Restricted stock
|
|
19
|
|
|
—
|
|
Convertible senior notes
|
|
—
|
|
|
1,929
|
|
|
|
Amortized
|
|
Unrealized
|
|
Fair
|
||||||||||
As of March 31, 2016
|
|
Cost Basis
|
|
Gains
|
|
Losses
|
|
Value
|
||||||||
Corporate bonds
|
|
$
|
710,989
|
|
|
$
|
1,920
|
|
|
$
|
(879
|
)
|
|
$
|
712,030
|
|
U.S. government and government agency obligations
|
|
50,383
|
|
|
194
|
|
|
(2
|
)
|
|
50,575
|
|
||||
Municipal bonds
|
|
16,113
|
|
|
45
|
|
|
(3
|
)
|
|
16,155
|
|
||||
Equity securities
|
|
17,005
|
|
|
10,057
|
|
|
(5,647
|
)
|
|
21,415
|
|
||||
|
|
$
|
794,490
|
|
|
$
|
12,216
|
|
|
$
|
(6,531
|
)
|
|
$
|
800,175
|
|
|
|
|
|
|
|
|
|
|
||||||||
As of December 31, 2015
|
|
|
|
|
|
|
|
|
||||||||
Corporate bonds
|
|
$
|
770,092
|
|
|
$
|
156
|
|
|
$
|
(2,565
|
)
|
|
$
|
767,683
|
|
U.S. government and government agency obligations
|
|
51,402
|
|
|
—
|
|
|
(193
|
)
|
|
51,209
|
|
||||
Municipal bonds
|
|
17,930
|
|
|
5
|
|
|
(11
|
)
|
|
17,924
|
|
||||
Equity securities
|
|
17,005
|
|
|
14,461
|
|
|
—
|
|
|
31,466
|
|
||||
|
|
$
|
856,429
|
|
|
$
|
14,622
|
|
|
$
|
(2,769
|
)
|
|
$
|
868,282
|
|
|
|
March 31, 2016
|
|
December 31, 2015
|
||||
Maturities within one year
|
|
$
|
244,965
|
|
|
$
|
236,121
|
|
Maturities after one year through five years
|
|
533,795
|
|
|
600,695
|
|
||
|
|
$
|
778,760
|
|
|
$
|
836,816
|
|
|
Less than 12 Months
|
|
12 Months or Greater
|
|
Total
|
||||||||||||||||||
As of March 31, 2016
|
Fair Value
|
|
Unrealized Loss
|
|
Fair Value
|
|
Unrealized Loss
|
|
Fair Value
|
|
Unrealized Loss
|
||||||||||||
Corporate bonds
|
$
|
132,085
|
|
|
$
|
(190
|
)
|
|
$
|
135,211
|
|
|
$
|
(689
|
)
|
|
$
|
267,296
|
|
|
$
|
(879
|
)
|
U.S. government and government agency obligations
|
7,822
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
7,822
|
|
|
(3
|
)
|
||||||
Municipal bonds
|
2,571
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
2,571
|
|
|
(2
|
)
|
||||||
Equity securities
|
9,353
|
|
|
(5,647
|
)
|
|
—
|
|
|
—
|
|
|
9,353
|
|
|
(5,647
|
)
|
||||||
|
$
|
151,831
|
|
|
$
|
(5,842
|
)
|
|
$
|
135,211
|
|
|
$
|
(689
|
)
|
|
$
|
287,042
|
|
|
$
|
(6,531
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
As of December 31, 2015
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Corporate bonds
|
$
|
668,199
|
|
|
$
|
(2,473
|
)
|
|
$
|
23,749
|
|
|
$
|
(92
|
)
|
|
$
|
691,948
|
|
|
$
|
(2,565
|
)
|
U.S. government and government agency obligations
|
51,215
|
|
|
(193
|
)
|
|
—
|
|
|
—
|
|
|
51,215
|
|
|
(193
|
)
|
||||||
Municipal bonds
|
11,917
|
|
|
(11
|
)
|
|
—
|
|
|
—
|
|
|
11,917
|
|
|
(11
|
)
|
||||||
|
$
|
731,331
|
|
|
$
|
(2,677
|
)
|
|
$
|
23,749
|
|
|
$
|
(92
|
)
|
|
$
|
755,080
|
|
|
$
|
(2,769
|
)
|
|
|
|
Fair Value Measurements at Reporting Date Using
|
||||||||
As of March 31, 2016
|
Fair Value
|
|
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
||||||
Available-for-sale marketable securities:
|
|
|
|
|
|
||||||
Corporate bonds
|
$
|
712,030
|
|
|
—
|
|
|
$
|
712,030
|
|
|
U.S. government and government agency obligations
|
50,575
|
|
|
—
|
|
|
50,575
|
|
|||
Municipal bonds
|
16,155
|
|
|
—
|
|
|
16,155
|
|
|||
Equity securities
|
21,415
|
|
|
$
|
21,415
|
|
|
—
|
|
||
|
$
|
800,175
|
|
|
$
|
21,415
|
|
|
$
|
778,760
|
|
|
|
|
|
|
|
||||||
As of December 31, 2015
|
|
|
|
|
|
||||||
Available-for-sale marketable securities:
|
|
|
|
|
|
||||||
Corporate bonds
|
$
|
767,683
|
|
|
—
|
|
|
$
|
767,683
|
|
|
U.S. government and government agency obligations
|
51,209
|
|
|
—
|
|
|
51,209
|
|
|||
Municipal bonds
|
17,924
|
|
|
—
|
|
|
17,924
|
|
|||
Equity securities
|
31,466
|
|
|
$
|
31,466
|
|
|
—
|
|
||
|
$
|
868,282
|
|
|
$
|
31,466
|
|
|
$
|
836,816
|
|
|
March 31,
|
|
December 31,
|
||||
|
2016
|
|
2015
|
||||
Raw materials
|
$
|
85,180
|
|
|
$
|
59,151
|
|
Work-in-process
|
157,921
|
|
|
132,068
|
|
||
Finished goods
|
14,231
|
|
|
11,197
|
|
||
Deferred costs
|
45,962
|
|
|
36,162
|
|
||
|
$
|
303,294
|
|
|
$
|
238,578
|
|
|
March 31,
|
|
December 31,
|
||||
|
2016
|
|
2015
|
||||
Accounts payable
|
$
|
120,595
|
|
|
$
|
140,962
|
|
Accrued payroll and related costs
|
92,668
|
|
|
133,223
|
|
||
Accrued clinical trial expense
|
82,533
|
|
|
88,297
|
|
||
Accrued sales-related charges, deductions, and royalties
|
190,763
|
|
|
195,986
|
|
||
Income taxes payable
|
144,078
|
|
|
—
|
|
||
Other accrued expenses and liabilities
|
102,639
|
|
|
85,644
|
|
||
|
$
|
733,276
|
|
|
$
|
644,112
|
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
•
|
EYLEA (aflibercept) Injection
, known in the scientific literature as VEGF Trap-Eye, is available in the United States, European Union (EU), Japan, and other countries outside the United States for the treatment of neovascular age-related macular degeneration (wet AMD), diabetic macular edema (DME), macular edema following retinal vein occlusion (RVO), which includes macular edema following central retinal vein occlusion (CRVO) and macular edema following branch retinal vein occlusion (BRVO). EYLEA is also available in the EU, Japan, and certain other countries outside the United States for the treatment of myopic choroidal neovascularization (mCNV) and in the United States for the treatment of diabetic retinopathy in patients with DME. Bayer has additional regulatory applications for EYLEA for various indications pending in other countries. We are collaborating with Bayer on the global development and commercialization of EYLEA outside the United States.
|
•
|
Praluent (alirocumab) Injection
, which is available in the United States where it is indicated as an adjunct to diet and maximally tolerated statin therapy for the treatment of adults with heterozygous familial hypercholesterolemia or clinical atherosclerotic cardiovascular disease (ASCVD), who require additional lowering of LDL cholesterol. Praluent is also available in certain countries in Europe for the treatment of adult patients with primary hypercholesterolemia (heterozygous familial hypercholesterolemia (HeFH) and non-familial) or mixed dyslipidemia as an adjunct to diet: (a) in combination with a statin, or statin with other lipid-lowering therapies in patients unable to reach their LDL-cholesterol goals with the maximally-tolerated dose of a statin, or (b) alone or in combination with other lipid-lowering therapies for patients who are statin intolerant, or for whom a statin is contraindicated. The effect of Praluent on cardiovascular morbidity and mortality has not been determined. We are collaborating with Sanofi on the global development and commercialization of Praluent.
|
•
|
ARCALYST
®
(rilonacept) Injection for Subcutaneous Use
, which is available in the United States for the treatment of Cryopyrin-Associated Periodic Syndromes (CAPS), including Familial Cold Auto-inflammatory Syndrome (FCAS) and Muckle-Wells Syndrome (MWS), in adults and children 12 years and older.
|
Trap-based Clinical Programs
|
|
EYLEA
|
|
In Phase 3 clinical development for the treatment of Neovascular Glaucoma (NVG) (in Japan) in collaboration with Bayer. Phase 3 study for the treatment of non-proliferative diabetic retinopathy (NPDR) in patients without DME initiated in the first quarter of 2016. As described below, aflibercept is also being studied in combination with (i) rinucumab, an antibody to Platelet Derived Growth Factor Receptor Beta (PDGFR-beta), and (ii) nesvacumab, an antibody to angiopoietin-2 (Ang2).
|
|
Antibody-based Clinical Programs in Collaboration with Sanofi
|
|
Praluent
|
|
Antibody to PCSK9. In Phase 3 clinical development for LDL cholesterol reduction and for the prevention of cardiovascular events. The effect of Praluent on cardiovascular morbidity and mortality has not been determined.
|
|
Sarilumab (REGN88)
|
|
Antibody to the interleukin-6 receptor (IL-6R). In clinical development in rheumatoid arthritis (Phase 3) and non-infectious uveitis (Phase 2).
|
|
Dupilumab (REGN668)
|
|
Antibody to the interleukin-4 receptor (IL-4R) alpha subunit. In clinical development in atopic dermatitis in adults (Phase 3), atopic dermatitis in pediatric patients (Phase 2), asthma (Phase 3), and eosinophilic esophagitis (EoE) (Phase 2). Plan to conduct Phase 3 studies in patients with nasal polyps.
|
|
REGN2810
|
|
Antibody to programmed cell death protein 1 (PD-1). In Phase 1 clinical development in solid tumors and advanced hematologic malignancies. Potentially pivotal Phase 2 study for the treatment of advanced cutaneous squamous cell carcinoma initiated in the second quarter of 2016.
|
|
Antibody-based Clinical Program in Collaboration with Bayer
|
|
Rinucumab/aflibercept (REGN2176-3)
**
|
|
Combination product comprised of an antibody to PDGFR-beta co-formulated with aflibercept for intravitreal injection for use in ophthalmology. In Phase 2 clinical development for the treatment of wet AMD. Fast Track designation received from the U.S. Food and Drug Administration (FDA) for the treatment of patients with wet AMD.
|
|
Nesvacumab/aflibercept (REGN910-3)
**
|
|
Combination product comprised of an antibody to Ang2 co-formulated with aflibercept for intravitreal injection for use in ophthalmology. Phase 2 studies for the treatment of wet AMD and DME initiated in the first quarter of 2016.
|
|
Antibody-based Clinical Program in Collaboration with Mitsubishi Tanabe Pharma
|
|
Fasinumab (REGN475)
*
|
|
Antibody to Nerve Growth Factor (NGF). In Phase 2/3 clinical development (16-week study) for pain due to osteoarthritis and lower back pain. Phase 3 long-term safety and efficacy study in patients with osteoarthritis of knee and hip initiated in the first quarter of 2016. Phase 2b/3 study for chronic lower back pain initiated in the first quarter of 2016.
|
|
Antibody-based Clinical Programs Developing Independently
|
|
REGN2222
*
|
|
Antibody to the Respiratory Syncytial Virus-F (RSV-F) protein. In Phase 3 clinical development for prevention of RSV infection.
|
|
Evinacumab (REGN1500)
*
|
|
Antibody to Angptl-3. In Phase 1/2 clinical development for the treatment of homozygous familial hypercholesterolemia (HoFH) and severe forms of hyperlipidemia.
|
|
Trevogrumab (REGN1033)
*
|
|
Antibody to myostatin (GDF8). Phase 2 monotherapy clinical development in skeletal muscle disorders completed. Combination therapy plans are in development.
|
|
REGN1908-1909
*
|
|
Antibody to Feld1. In Phase 1 clinical development against allergic disease.
|
|
REGN1979
|
|
Bispecific antibody against CD20 and CD3. In Phase 1 clinical development for Non-Hodgkin's Lymphoma, Chronic Lymphocytic Leukemia, and Acute Lymphoblastic Leukemia. REGN1979 is also being studied in combination with REGN2810 (antibody to PD-1) in B-cell malignancies.
|
*
Sanofi did not opt-in to or elected not to continue to co-develop the product candidate. Under the terms of our agreement, Sanofi is entitled to receive royalties on any future sales of the product candidate.
|
||||
**
Antibodies targeting the PDGF family of receptors and ligands in ophthalmology and all other indications, and antibodies targeting the Ang2 receptor and ligand in ophthalmology were previously included in our antibody collaboration with Sanofi. Under the terms of our agreements, Sanofi is entitled to receive potential development milestones and royalties on any future sales of the product candidate.
|
•
|
For SOLO 1 and SOLO 2, respectively, 37% and 36% of patients who received dupilumab 300 mg weekly, and 38% and 36% of patients who received dupilumab 300 mg every two weeks, achieved clearing or near-clearing of skin lesions (IGA 0 or 1), compared to 10% and 8.5% with placebo (p<0.0001). This was the primary endpoint of the study in the United States.
|
•
|
For SOLO 1 and SOLO 2, respectively, the percent improvement in EASI from baseline was 72% and 69% in patients who received the 300 mg weekly dose, and 72% and 67% for patients who received dupilumab 300 mg every two weeks, compared to 38% and 31% for placebo (p<0.0001).
|
•
|
For SOLO 1 and SOLO 2, respectively, 52.5% and 48% of patients who received dupilumab 300 mg weekly, and 51% and 44% of patients who received dupilumab 300 mg every two weeks, achieved EASI-75 compared to 15% and 12% with placebo (p<0.0001). This was the key secondary endpoint in the United States and one of the primary endpoints in the EU.
|
Antibody-based Clinical Programs:
|
|
|
|
|
|
|
2016 Events to Date
|
|
2016-2017 Plans (next 12 months)
|
Praluent (PCSK9 Antibody)
|
|
Reported positive results from Phase 3 ODYSSEY ESCAPE trial
|
|
Report additional data from Phase 3 ODYSSEY program
|
|
|
The DMC of the ODYSSEY OUTCOMES study completed the first interim analysis for futility and recommended the study continue with no changes
|
|
Submit for additional regulatory approvals outside the United States
|
|
|
|
Regulatory agency and reimbursement authority decisions on applications outside the United States
|
|
|
|
|
|
Prespecified early-stopping interim analysis by DMC of ODYSSEY OUTCOMES trial
|
|
|
|
|
Filing of supplemental BLA for monthly dosing regimen
|
|
|
|
|
|
|
|
|
|
|
(In millions)
|
2016
|
|
2015
|
||||
Revenues
|
$
|
1,200.8
|
|
|
$
|
869.6
|
|
Operating expenses
|
(871.5
|
)
|
|
(586.1
|
)
|
||
Other income (expense)
|
0.8
|
|
|
(7.0
|
)
|
||
Income before income taxes
|
330.1
|
|
|
276.5
|
|
||
Income tax expense
|
(164.4
|
)
|
|
(200.5
|
)
|
||
Net income
|
$
|
165.7
|
|
|
$
|
76.0
|
|
(In millions)
|
2016
|
|
2015
|
||||
Net product sales
|
$
|
784.2
|
|
|
$
|
544.6
|
|
Collaboration revenue:
|
|
|
|
||||
Sanofi
|
219.7
|
|
|
173.4
|
|
||
Bayer
|
179.6
|
|
|
123.8
|
|
||
Total collaboration revenue
|
399.3
|
|
|
297.2
|
|
||
Other revenue
|
17.3
|
|
|
27.8
|
|
||
Total revenues
|
$
|
1,200.8
|
|
|
$
|
869.6
|
|
(In millions)
|
Rebates &
Chargebacks
|
|
Distribution-
Related
Fees
|
|
Other Sales-
Related
Deductions
|
|
Total
|
||||||||
Balance as of December 31, 2015
|
$
|
6.4
|
|
|
$
|
48.3
|
|
|
$
|
0.5
|
|
|
$
|
55.2
|
|
Provision related to current period sales
|
18.9
|
|
|
35.8
|
|
|
2.9
|
|
|
57.6
|
|
||||
Credits/payments
|
(17.5
|
)
|
|
(50.4
|
)
|
|
(2.5
|
)
|
|
(70.4
|
)
|
||||
Balance as of March 31, 2016
|
$
|
7.8
|
|
|
$
|
33.7
|
|
|
$
|
0.9
|
|
|
$
|
42.4
|
|
|
|
|
|
|
|
|
|
||||||||
Balance as of December 31, 2014
|
$
|
3.1
|
|
|
$
|
21.2
|
|
|
$
|
0.5
|
|
|
$
|
24.8
|
|
Provision related to current period sales
|
11.4
|
|
|
24.7
|
|
|
1.4
|
|
|
37.5
|
|
||||
Credits/payments
|
(9.8
|
)
|
|
(13.0
|
)
|
|
(1.4
|
)
|
|
(24.2
|
)
|
||||
Balance as of March 31, 2015
|
$
|
4.7
|
|
|
$
|
32.9
|
|
|
$
|
0.5
|
|
|
$
|
38.1
|
|
Sanofi Collaboration Revenue
|
|
Three Months Ended March 31,
|
||||||
(In millions)
|
|
2016
|
|
2015
|
||||
Antibody:
|
|
|
|
|
||||
Reimbursement of Regeneron research and development expenses
|
|
$
|
193.6
|
|
|
$
|
168.8
|
|
Reimbursement of Regeneron commercialization-related expenses
|
|
73.3
|
|
|
8.5
|
|
||
Regeneron's share of losses in connection with commercialization of antibodies
|
|
(99.4
|
)
|
|
(22.4
|
)
|
||
Other
|
|
2.9
|
|
|
2.6
|
|
||
Total Antibody
|
|
170.4
|
|
|
157.5
|
|
||
Immuno-oncology:
|
|
|
|
|
||||
Reimbursement of Regeneron research and development expenses
|
|
29.3
|
|
|
—
|
|
||
Other
|
|
20.0
|
|
|
—
|
|
||
Total Immuno-oncology
|
|
49.3
|
|
|
—
|
|
||
ZALTRAP:
|
|
|
|
|
||||
Reimbursement of Regeneron research and development expenses
|
|
—
|
|
|
0.7
|
|
||
Other
|
|
—
|
|
|
15.2
|
|
||
Total ZALTRAP
|
|
—
|
|
|
15.9
|
|
||
Total Sanofi collaboration revenue
|
|
$
|
219.7
|
|
|
$
|
173.4
|
|
Bayer Collaboration Revenue
|
|
Three Months Ended March 31,
|
||||||
(In millions)
|
|
2016
|
|
2015
|
||||
EYLEA:
|
|
|
|
|
||||
Regeneron's net profit in connection with commercialization of EYLEA outside the United States
|
|
$
|
145.8
|
|
|
$
|
89.4
|
|
Sales milestones
|
|
—
|
|
|
15.0
|
|
||
Cost-sharing of Regeneron EYLEA development expenses
|
|
2.7
|
|
|
2.7
|
|
||
Other
|
|
26.6
|
|
|
12.9
|
|
||
Total EYLEA
|
|
175.1
|
|
|
120.0
|
|
||
PDGFR-beta antibody:
|
|
|
|
|
||||
Cost-sharing of REGN2176-3 development expenses
|
|
1.9
|
|
|
1.3
|
|
||
Other
|
|
2.6
|
|
|
2.5
|
|
||
Total PDGFR-beta antibody
|
|
4.5
|
|
|
3.8
|
|
||
Total Bayer collaboration revenue
|
|
$
|
179.6
|
|
|
$
|
123.8
|
|
Regeneron's Net Profit from EYLEA Sales Outside the United States
|
|
Three Months Ended March 31,
|
||||||
(In millions)
|
|
2016
|
|
2015
|
||||
Net product sales outside the United States
|
|
$
|
418.9
|
|
|
$
|
291.8
|
|
Regeneron's share of collaboration profit from sales outside the United States
|
|
159.4
|
|
|
103.4
|
|
||
Reimbursement of EYLEA development expenses incurred by Bayer in accordance with Regeneron's payment obligation
|
|
(13.6
|
)
|
|
(14.0
|
)
|
||
Regeneron's net profit in connection with commercialization of EYLEA outside the United States
|
|
$
|
145.8
|
|
|
$
|
89.4
|
|
Research and Development Expenses
|
|
Three Months Ended March 31,
|
|
Increase
|
||||||||
(In millions)
|
|
2016
|
|
2015
|
|
(Decrease)
|
||||||
Payroll and benefits
(1)
|
|
$
|
149.0
|
|
|
$
|
116.1
|
|
|
$
|
32.9
|
|
Clinical trial expenses
|
|
90.4
|
|
|
56.2
|
|
|
34.2
|
|
|||
Clinical manufacturing costs
(2)
|
|
125.1
|
|
|
88.8
|
|
|
36.3
|
|
|||
Research and other development costs
|
|
40.7
|
|
|
25.9
|
|
|
14.8
|
|
|||
Occupancy and other operating costs
|
|
42.0
|
|
|
29.2
|
|
|
12.8
|
|
|||
Cost-sharing of Bayer and Sanofi development expenses
(3)
|
|
22.9
|
|
|
26.9
|
|
|
(4.0
|
)
|
|||
Total research and development expenses
|
|
$
|
470.1
|
|
|
$
|
343.1
|
|
|
$
|
127.0
|
|