Biogen (BIIB) Q4 2024 Earnings Call Transcript

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Biogen (BIIB -6.20%)
Q4 2024 Earnings Call
Feb 12, 2025, 8:30 a.m. ET

Contents:

• Prepared Remarks
• Questions and Answers
• Call Participants

Prepared Remarks:

Operator

Good morning. My name is Jennifer, and I will be your conference operator today. At this time, I’d like to welcome everyone to the Biogen fourth-quarter and full-year 2024 earnings call and business update. [Operator instructions] Today’s conference is being recorded.

Thank you. I would now like to turn the conference over to Mr. Tim Power, head of investor relations. Mr.

Power, you may begin your conference.

Tim Power — Vice President, Head of Investor Relations

Thanks, Jennifer, and good morning, and welcome to Biogen’s fourth-quarter and full-year 2024 earnings call. During this call, we’ll make forward-looking statements, which involve risks and uncertainties that may cause actual results to differ materially from our forward-looking statements. We provide a comprehensive list of risk factors in our SEC filings, which I encourage you to review. Our earnings release and other documents related to our results as well as reconciliations between GAAP and non-GAAP results discussed on this call can be found in the Investors section of biogen.com.

We’ve also posted slides on our website that we will be using during the call. On today’s call, I’m joined by our president and chief executive officer, Christopher Viehbacher, Dr. Priya Singhal, head of development; and Mike McDonnell, chief financial officer. We’ll make some opening comments and then move to Q&A.

[Operator instructions] And with that, I’ll hand over to Chris.

Christopher Viehbacher — President and Chief Executive Officer

Thank you, Tim. Good morning, everybody. Perhaps before we get started, I’d just like to note that this is Mike McDonnell’s last quarterly presentation as CFO of Biogen. Mike, I believe this is your 97th quarter as a publicly quoted CFO.

So congratulations on that amazing career and I’ll just take the opportunity to thank you. You’ve been a terrific partner and team member, and it’s been great working with you, and we will miss you. And we, of course, are joined here also by Robin Kramer. I’m also proud to say that we’ve been able to promote from within, and it’s a great source of pride that we have that level of talent within the organization.

So let’s turn to Q4. As you all know, we have been faced with increased competition for our multiple sclerosis franchise. And really, all of our priorities are thinking about how do we now build a new Biogen, how do we build a new phase of growth. And we are focused really around three core priorities.

The first are clearly the four products that we launched last year in Alzheimer’s, Friedreich’s ataxia, depression, and ALS. Each of those products is not only first-in-class but first disease-modifying agent in each of these diseases. Now that’s a source of pride in the level of innovation that Biogen is capable of. But equally, from a commercial point of view, this is a significant challenge since the level of education when you’re a pioneer in an area is so much greater, and we’ll come back and talk a little bit more about that.

The next is we have really reprioritized the pipeline. It’s certainly been my experience over the years that focusing on a number of key projects is core to business success. And I’m pretty grateful to both Priya Singhal and Jane Grogan because they have both really, I think, cleaned out the pipeline for development in Priya’s cases, in research in Jane’s case, and we’re actually excited now by the products that are in there. We’ve got a number of key developments that will start reading out in 2026.

We think this is a multibillion-dollar portfolio. And we’re probably one of the few companies that can look at a pipeline that could be more than — it could be more than our current biopharmaceutical business when it gets to peak sales if it all, obviously, comes to market. So if we can go to the — and the third point, of course, is we have redesigned the company with a reduction of operating expenses, not just saving costs for the sake of cost but the ability to release resources for investing in growth, and that’s what we’re continuing to do. We’re excited about our pipeline, but we’ve also freed up an awful lot of cash flow, as you’ll see later.

And that cash flow, we’re investing for more substrate in growth. So yes, now, Dan, please next slide. So the race really that we are faced with is seeing the erosion of our multiple sclerosis product revenue, but I’m particularly happy to see in 2024 that the revenue from our launch products really offset the — more than offset the decline in our multiple sclerosis product revenue. And indeed, when you actually look at total revenue declined by $160 million, and you note that contract manufacturing declined by $247 million, it meant that really our core pharma business actually grew, and that’s for the first time in four years.