FORM 10-Q
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(Mark One)
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ý
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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
September 30, 2018
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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: 0-19034
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New York
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13-3444607
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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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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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
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Yes
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ý
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No
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¨
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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
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Yes
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ý
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No
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¨
|
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
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Large accelerated filer
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ý
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Accelerated filer
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¨
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Non-accelerated filer
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¨
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Smaller reporting company
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¨
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Emerging growth company
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¨
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If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
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¨
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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
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Yes
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¨
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No
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ý
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Class of Common Stock
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Number of Shares
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Class A Stock, $.001 par value
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1,911,354
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Common Stock, $.001 par value
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106,323,210
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Page Numbers
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"ARCALYST
®
", "EYLEA
®
", "Regeneron
®
", "Regeneron Genetics Center
®
", "
VelociGene
®
", "
VelociMab
®
", "
VelocImmune
®
", "
VelociMouse
®
", "
VelociSuite
®
", and "ZALTRAP
®
" 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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September 30,
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December 31,
|
||||
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2018
|
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2017
|
||||
ASSETS
|
|||||||
Current assets:
|
|
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|
||||
Cash and cash equivalents
|
$
|
1,087,843
|
|
|
$
|
812,733
|
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Marketable securities
|
1,104,309
|
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596,847
|
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||
Accounts receivable - trade, net
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1,665,737
|
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1,538,642
|
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Accounts receivable from Sanofi
|
269,271
|
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193,684
|
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Accounts receivable from Bayer
|
267,937
|
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242,014
|
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||
Inventories
|
1,039,679
|
|
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726,138
|
|
||
Prepaid expenses and other current assets
|
284,807
|
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224,972
|
|
||
Total current assets
|
5,719,583
|
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4,335,030
|
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||
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||||
Marketable securities
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1,873,569
|
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1,486,494
|
|
||
Property, plant, and equipment, net
|
2,524,446
|
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|
2,358,605
|
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||
Deferred tax assets
|
562,818
|
|
|
506,291
|
|
||
Other noncurrent assets
|
125,197
|
|
|
77,866
|
|
||
Total assets
|
$
|
10,805,613
|
|
|
$
|
8,764,286
|
|
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|
||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|||||||
Current liabilities:
|
|
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|
||||
Accounts payable
|
$
|
172,361
|
|
|
$
|
178,183
|
|
Accrued expenses and other current liabilities
|
781,924
|
|
|
637,162
|
|
||
Deferred revenue from Sanofi
|
246,812
|
|
|
177,746
|
|
||
Deferred revenue - other
|
216,133
|
|
|
142,392
|
|
||
Total current liabilities
|
1,417,230
|
|
|
1,135,483
|
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||
|
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||||
Capital and facility lease obligations
|
707,203
|
|
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703,453
|
|
||
Deferred revenue from Sanofi
|
421,196
|
|
|
379,936
|
|
||
Deferred revenue - other
|
197,651
|
|
|
249,263
|
|
||
Other noncurrent liabilities
|
194,033
|
|
|
152,073
|
|
||
Total liabilities
|
2,937,313
|
|
|
2,620,208
|
|
||
|
|
|
|
||||
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 - 1,911,354 in 2018 and 2017
|
2
|
|
|
2
|
|
||
Common Stock, $.001 par value; 320,000,000 shares authorized; shares issued - 110,288,595 in 2018 and 109,477,222 in 2017
|
110
|
|
|
110
|
|
||
Additional paid-in capital
|
3,841,174
|
|
|
3,512,833
|
|
||
Retained earnings
|
4,433,904
|
|
|
2,946,733
|
|
||
Accumulated other comprehensive (loss) income
|
(10,519
|
)
|
|
640
|
|
||
Treasury Stock, at cost; 3,990,021 shares in 2018 and 3,763,868 shares in 2017
|
(396,371
|
)
|
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(316,240
|
)
|
||
Total stockholders' equity
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7,868,300
|
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6,144,078
|
|
||
Total liabilities and stockholders' equity
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$
|
10,805,613
|
|
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$
|
8,764,286
|
|
|
|
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|
||||
The accompanying notes are an integral part of the financial statements.
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Three Months Ended
September 30, |
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Nine Months Ended
September 30, |
||||||||||||
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2018
|
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2017
|
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2018
|
|
2017
|
||||||||
Statements of Operations
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||||||||
Revenues:
|
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|
||||||||
Net product sales
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$
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1,025,488
|
|
|
$
|
957,367
|
|
|
$
|
3,009,779
|
|
|
$
|
2,739,745
|
|
Sanofi collaboration revenue
|
|
256,265
|
|
|
245,175
|
|
|
683,508
|
|
|
677,670
|
|
||||
Bayer collaboration revenue
|
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264,373
|
|
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236,625
|
|
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775,164
|
|
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640,919
|
|
||||
Other revenue
|
|
117,370
|
|
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61,506
|
|
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314,552
|
|
|
231,446
|
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||||
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1,663,496
|
|
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1,500,673
|
|
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4,783,003
|
|
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4,289,780
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||||||||
Expenses:
|
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||||||||
Research and development
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556,972
|
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529,749
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1,584,847
|
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1,547,159
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|
||||
Selling, general, and administrative
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369,232
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306,766
|
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1,064,886
|
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910,520
|
|
||||
Cost of goods sold
|
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30,817
|
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46,388
|
|
|
136,010
|
|
|
149,774
|
|
||||
Cost of collaboration and contract manufacturing
|
|
79,552
|
|
|
57,844
|
|
|
180,918
|
|
|
141,547
|
|
||||
|
|
1,036,573
|
|
|
940,747
|
|
|
2,966,661
|
|
|
2,749,000
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Income from operations
|
|
626,923
|
|
|
559,926
|
|
|
1,816,342
|
|
|
1,540,780
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Other income (expense):
|
|
|
|
|
|
|
|
|
||||||||
Other income (expense), net
|
|
16,432
|
|
|
11,861
|
|
|
81,842
|
|
|
2,048
|
|
||||
Interest expense
|
|
(7,494
|
)
|
|
(6,182
|
)
|
|
(20,851
|
)
|
|
(19,084
|
)
|
||||
|
|
8,938
|
|
|
5,679
|
|
|
60,991
|
|
|
(17,036
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Income before income taxes
|
|
635,861
|
|
|
565,605
|
|
|
1,877,333
|
|
|
1,523,744
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Income tax expense
|
|
(41,206
|
)
|
|
(177,288
|
)
|
|
(253,286
|
)
|
|
(498,752
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
|
$
|
594,655
|
|
|
$
|
388,317
|
|
|
$
|
1,624,047
|
|
|
$
|
1,024,992
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income per share - basic
|
|
$
|
5.50
|
|
|
$
|
3.64
|
|
|
$
|
15.06
|
|
|
$
|
9.66
|
|
Net income per share - diluted
|
|
$
|
5.17
|
|
|
$
|
3.32
|
|
|
$
|
14.14
|
|
|
$
|
8.84
|
|
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares outstanding - basic
|
|
108,033
|
|
|
106,706
|
|
|
107,828
|
|
|
106,108
|
|
||||
Weighted average shares outstanding - diluted
|
|
115,088
|
|
|
117,028
|
|
|
114,843
|
|
|
115,994
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Statements of Comprehensive Income
|
|
|
|
|
|
|
|
|
||||||||
Net income
|
|
$
|
594,655
|
|
|
$
|
388,317
|
|
|
$
|
1,624,047
|
|
|
$
|
1,024,992
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
||||||||
Unrealized gain (loss) on marketable securities
|
|
752
|
|
|
21,485
|
|
|
(6,954
|
)
|
|
36,645
|
|
||||
Unrealized gain on cash flow hedges
|
|
341
|
|
|
2
|
|
|
2,388
|
|
|
30
|
|
||||
Comprehensive income
|
|
$
|
595,748
|
|
|
$
|
409,804
|
|
|
$
|
1,619,481
|
|
|
$
|
1,061,667
|
|
|
|
|
|
|
|
|
|
|
||||||||
The accompanying notes are an integral part of the financial statements.
|
|
|
Nine Months Ended
September 30, |
||||||
|
|
2018
|
|
2017
|
||||
Cash flows from operating activities:
|
|
|
|
|
||||
Net income
|
|
$
|
1,624,047
|
|
|
$
|
1,024,992
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
||||
Depreciation and amortization
|
|
105,441
|
|
|
110,960
|
|
||
Non-cash compensation expense
|
|
300,652
|
|
|
380,144
|
|
||
Other non-cash items, net
|
|
(82,694
|
)
|
|
44,016
|
|
||
Deferred taxes
|
|
(33,521
|
)
|
|
(108,242
|
)
|
||
Changes in assets and liabilities:
|
|
|
|
|
||||
Increase in Sanofi, Bayer, and trade accounts receivable
|
|
(228,605
|
)
|
|
(359,829
|
)
|
||
Increase in inventories
|
|
(281,624
|
)
|
|
(235,645
|
)
|
||
Increase in prepaid expenses and other assets
|
|
(87,817
|
)
|
|
(28,209
|
)
|
||
Decrease in deferred revenue
|
|
(29,462
|
)
|
|
(59,116
|
)
|
||
Increase (decrease) in accounts payable, accrued expenses, and other liabilities
|
|
179,852
|
|
|
(28,908
|
)
|
||
Total adjustments
|
|
(157,778
|
)
|
|
(284,829
|
)
|
||
Net cash provided by operating activities
|
|
1,466,269
|
|
|
740,163
|
|
||
|
|
|
|
|
||||
Cash flows from investing activities:
|
|
|
|
|
||||
Purchases of marketable and other securities
|
|
(1,533,558
|
)
|
|
(883,748
|
)
|
||
Sales or maturities of marketable securities
|
|
644,103
|
|
|
379,275
|
|
||
Capital expenditures
|
|
(297,638
|
)
|
|
(164,963
|
)
|
||
Other
|
|
(10,000
|
)
|
|
—
|
|
||
Net cash used in investing activities
|
|
(1,197,093
|
)
|
|
(669,436
|
)
|
||
|
|
|
|
|
||||
Cash flows from financing activities:
|
|
|
|
|
||||
Proceeds in connection with capital and facility lease obligations
|
|
—
|
|
|
57,000
|
|
||
Payments in connection with capital and facility lease obligations
|
|
—
|
|
|
(19,925
|
)
|
||
Proceeds from issuance of Common Stock
|
|
87,408
|
|
|
226,892
|
|
||
Payments in connection with Common Stock tendered for employee tax obligations
|
|
(77,096
|
)
|
|
(77,832
|
)
|
||
Repurchases of Common Stock
|
|
(4,378
|
)
|
|
—
|
|
||
Net cash provided by financing activities
|
|
5,934
|
|
|
186,135
|
|
||
|
|
|
|
|
||||
Net increase in cash, cash equivalents, and restricted cash
|
|
275,110
|
|
|
256,862
|
|
||
|
|
|
|
|
||||
Cash, cash equivalents, and restricted cash at beginning of period
|
|
825,233
|
|
|
547,703
|
|
||
|
|
|
|
|
||||
Cash, cash equivalents, and restricted cash at end of period
|
|
$
|
1,100,343
|
|
|
$
|
804,565
|
|
|
|
|
|
|
||||
The accompanying notes are an integral part of the financial statements.
|
|
|
September 30, 2018
|
||||||||||
Balance Sheet Data
|
|
As Reported
|
|
Adjustments
|
|
Balance Without Adoption of ASC 606
|
||||||
Inventories
|
|
$
|
1,039,679
|
|
|
$
|
17,518
|
|
|
$
|
1,057,197
|
|
Deferred tax assets
|
|
$
|
562,818
|
|
|
$
|
(15,027
|
)
|
|
$
|
547,791
|
|
Total assets
|
|
$
|
10,805,613
|
|
|
$
|
2,491
|
|
|
$
|
10,808,104
|
|
Accrued expenses and other current liabilities
|
|
$
|
781,924
|
|
|
$
|
(1,175
|
)
|
|
$
|
780,749
|
|
Deferred revenue from Sanofi (current)
|
|
$
|
246,812
|
|
|
$
|
(60,406
|
)
|
|
$
|
186,406
|
|
Deferred revenue - other (current)
|
|
$
|
216,133
|
|
|
$
|
(78,611
|
)
|
|
$
|
137,522
|
|
Total current liabilities
|
|
$
|
1,417,230
|
|
|
$
|
(140,192
|
)
|
|
$
|
1,277,038
|
|
Deferred revenue from Sanofi (noncurrent)
|
|
$
|
421,196
|
|
|
$
|
(28,078
|
)
|
|
$
|
393,118
|
|
Deferred revenue - other (noncurrent)
|
|
$
|
197,651
|
|
|
$
|
32,952
|
|
|
$
|
230,603
|
|
Total liabilities
|
|
$
|
2,937,313
|
|
|
$
|
(135,318
|
)
|
|
$
|
2,801,995
|
|
Retained earnings
|
|
$
|
4,433,904
|
|
|
$
|
137,809
|
|
|
$
|
4,571,713
|
|
Total stockholders' equity
|
|
$
|
7,868,300
|
|
|
$
|
137,809
|
|
|
$
|
8,006,109
|
|
Total liabilities and stockholders' equity
|
|
$
|
10,805,613
|
|
|
$
|
2,491
|
|
|
$
|
10,808,104
|
|
|
|
Three Months Ended
September 30, 2018
|
|
Nine Months Ended
September 30, 2018
|
||||||||||||||||||||
Consolidated Statement of Operations Data
|
|
As Reported
|
|
Adjustments
|
|
Balance Without Adoption of ASC 606
|
|
As Reported
|
|
Adjustments
|
|
Balance Without Adoption of ASC 606
|
||||||||||||
Sanofi collaboration revenue
|
|
$
|
256,265
|
|
|
$
|
12,172
|
|
|
$
|
268,437
|
|
|
$
|
683,508
|
|
|
$
|
(5,159
|
)
|
|
$
|
678,349
|
|
Other revenue
|
|
$
|
117,370
|
|
|
$
|
24,574
|
|
|
$
|
141,944
|
|
|
$
|
314,552
|
|
|
$
|
(22,615
|
)
|
|
$
|
291,937
|
|
Total revenues
|
|
$
|
1,663,496
|
|
|
$
|
36,746
|
|
|
$
|
1,700,242
|
|
|
$
|
4,783,003
|
|
|
$
|
(27,774
|
)
|
|
$
|
4,755,229
|
|
Cost of collaboration and contract manufacturing
|
|
$
|
79,552
|
|
|
$
|
(17,518
|
)
|
|
$
|
62,034
|
|
|
$
|
180,918
|
|
|
$
|
(17,518
|
)
|
|
$
|
163,400
|
|
Income from operations
|
|
$
|
626,923
|
|
|
$
|
54,264
|
|
|
$
|
681,187
|
|
|
$
|
1,816,342
|
|
|
$
|
(10,256
|
)
|
|
$
|
1,806,086
|
|
Income before income taxes
|
|
$
|
635,861
|
|
|
$
|
54,264
|
|
|
$
|
690,125
|
|
|
$
|
1,877,333
|
|
|
$
|
(10,256
|
)
|
|
$
|
1,867,077
|
|
Income tax expense
|
|
$
|
(41,206
|
)
|
|
$
|
(2,663
|
)
|
|
$
|
(43,869
|
)
|
|
$
|
(253,286
|
)
|
|
$
|
4,630
|
|
|
$
|
(248,656
|
)
|
Net income
|
|
$
|
594,655
|
|
|
$
|
51,601
|
|
|
$
|
646,256
|
|
|
$
|
1,624,047
|
|
|
$
|
(5,626
|
)
|
|
$
|
1,618,421
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
Net Product Sales in the United States
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
EYLEA
®
|
|
$
|
1,021,782
|
|
|
$
|
953,279
|
|
|
$
|
2,997,829
|
|
|
$
|
2,727,132
|
|
ARCALYST
®
|
|
3,706
|
|
|
4,088
|
|
|
11,950
|
|
|
12,613
|
|
||||
|
|
$
|
1,025,488
|
|
|
$
|
957,367
|
|
|
$
|
3,009,779
|
|
|
$
|
2,739,745
|
|
|
Rebates, Chargebacks, and Discounts
|
|
Distribution-
Related
Fees
|
|
Other Sales-
Related
Deductions
|
|
Total
|
||||||||
Balance as of December 31, 2017
|
$
|
29,840
|
|
|
$
|
34,142
|
|
|
$
|
21,320
|
|
|
$
|
85,302
|
|
Provisions
|
159,060
|
|
|
155,523
|
|
|
29,730
|
|
|
344,313
|
|
||||
Credits/payments
|
(145,813
|
)
|
|
(150,956
|
)
|
|
(35,756
|
)
|
|
(332,525
|
)
|
||||
Balance as of September 30, 2018
|
$
|
43,087
|
|
|
$
|
38,709
|
|
|
$
|
15,294
|
|
|
$
|
97,090
|
|
|
|
|
|
|
|
|
|
||||||||
Balance as of December 31, 2016
|
$
|
12,712
|
|
|
$
|
29,465
|
|
|
$
|
3,674
|
|
|
$
|
45,851
|
|
Provisions
|
121,599
|
|
|
140,860
|
|
|
33,518
|
|
|
295,977
|
|
||||
Credits/payments
|
(108,811
|
)
|
|
(136,272
|
)
|
|
(21,444
|
)
|
|
(266,527
|
)
|
||||
Balance as of September 30, 2017
|
$
|
25,500
|
|
|
$
|
34,053
|
|
|
$
|
15,748
|
|
|
$
|
75,301
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
Sanofi Collaboration Revenue
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Antibody:
|
|
|
|
|
|
|
|
|
||||||||
Reimbursement of Regeneron research and development expenses
|
|
$
|
76,150
|
|
|
$
|
128,539
|
|
|
$
|
201,026
|
|
|
$
|
421,056
|
|
Reimbursement of Regeneron commercialization-related expenses
|
|
103,666
|
|
|
90,339
|
|
|
292,756
|
|
|
251,002
|
|
||||
Regeneron's share of losses in connection with commercialization of antibodies
|
|
(38,924
|
)
|
|
(98,315
|
)
|
|
(182,595
|
)
|
|
(328,998
|
)
|
||||
Other
|
|
33,166
|
|
|
41,848
|
|
|
82,150
|
|
|
84,338
|
|
||||
Total Antibody
|
|
174,058
|
|
|
162,411
|
|
|
393,337
|
|
|
427,398
|
|
||||
Immuno-oncology:
|
|
|
|
|
|
|
|
|
||||||||
Reimbursement of Regeneron research and development expenses
|
|
74,797
|
|
|
61,649
|
|
|
225,675
|
|
|
188,408
|
|
||||
Reimbursement of Regeneron commercialization-related expenses
|
|
3,236
|
|
|
1,115
|
|
|
6,507
|
|
|
1,864
|
|
||||
Other
|
|
4,174
|
|
|
20,000
|
|
|
57,989
|
|
|
60,000
|
|
||||
Total Immuno-oncology
|
|
82,207
|
|
|
82,764
|
|
|
290,171
|
|
|
250,272
|
|
||||
|
|
$
|
256,265
|
|
|
$
|
245,175
|
|
|
$
|
683,508
|
|
|
$
|
677,670
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2018
|
|
2017
|
||||
Accounts receivable
|
|
$
|
187,704
|
|
|
$
|
121,001
|
|
Deferred revenue
|
|
$
|
199,523
|
|
|
$
|
117,682
|
|
|
|
Nine Months Ended
September 30, 2018
|
||
Increase due to shipments of commercial supplies to Sanofi
|
|
$
|
178,608
|
|
Revenue recognized that was included in deferred revenue at the beginning of the period
|
|
$
|
(96,767
|
)
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2018
|
|
2017
|
||||
Accounts receivable
|
|
$
|
75,627
|
|
|
$
|
59,274
|
|
Deferred revenue
|
|
$
|
468,484
|
|
|
$
|
440,000
|
|
|
|
Nine Months Ended
September 30, 2018
|
||
Increase as a result of cumulative-effect adjustment arising from the adoption of ASC 606
|
|
$
|
93,643
|
|
Revenue recognized that was included in deferred revenue at the beginning of the period
|
|
$
|
(65,159
|
)
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
Bayer EYLEA Collaboration Revenue
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Regeneron's net profit in connection with commercialization of EYLEA outside the United States
|
|
$
|
243,152
|
|
|
$
|
205,367
|
|
|
$
|
721,522
|
|
|
$
|
571,126
|
|
Reimbursement of Regeneron EYLEA development expenses
|
|
1,676
|
|
|
6,053
|
|
|
8,811
|
|
|
10,833
|
|
||||
Other
|
|
20,764
|
|
|
15,714
|
|
|
45,321
|
|
|
36,910
|
|
||||
|
|
$
|
265,592
|
|
|
$
|
227,134
|
|
|
$
|
775,654
|
|
|
$
|
618,869
|
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2018
|
|
2017
|
||||
Accounts receivable
|
|
$
|
269,155
|
|
|
$
|
241,153
|
|
Deferred revenue
|
|
$
|
85,504
|
|
|
$
|
68,734
|
|
|
|
Nine Months Ended
September 30, 2018
|
||
Increase due to shipments of commercial supplies to Bayer
|
|
$
|
47,958
|
|
Revenue recognized that was included in deferred revenue at the beginning of the period
|
|
$
|
(31,188
|
)
|
|
|
September 30,
|
|
December 31,
|
||||
|
|
2018
|
|
2017
|
||||
Accounts receivable (recorded within Prepaid expenses and other current assets)
|
|
$
|
87,985
|
|
|
$
|
71,297
|
|
Deferred revenue
|
|
$
|
213,660
|
|
|
$
|
197,357
|
|
|
|
Nine Months Ended
September 30, 2018
|
||
Increase as a result of cumulative-effect adjustment arising from the adoption of ASC 606
|
|
$
|
48,216
|
|
Increase due to amounts invoiced, excluding amounts recognized as revenue during the period
|
|
$
|
33,774
|
|
Revenue recognized that was included in deferred revenue at the beginning of the period
|
|
$
|
(67,771
|
)
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net income - basic and diluted
|
|
$
|
594,655
|
|
|
$
|
388,317
|
|
|
$
|
1,624,047
|
|
|
$
|
1,024,992
|
|
|
|
|
|
|
|
|
|
|
||||||||
(Shares in thousands)
|
|
|
|
|
|
|
|
|
||||||||
Weighted average shares - basic
|
|
108,033
|
|
|
106,706
|
|
|
107,828
|
|
|
106,108
|
|
||||
Effect of dilutive securities:
|
|
|
|
|
|
|
|
|
||||||||
Stock options
|
|
7,027
|
|
|
9,809
|
|
|
6,999
|
|
|
9,386
|
|
||||
Restricted stock
|
|
28
|
|
|
513
|
|
|
16
|
|
|
500
|
|
||||
Dilutive potential shares
|
|
7,055
|
|
|
10,322
|
|
|
7,015
|
|
|
9,886
|
|
||||
Weighted average shares - diluted
|
|
115,088
|
|
|
117,028
|
|
|
114,843
|
|
|
115,994
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Net income per share - basic
|
|
$
|
5.50
|
|
|
$
|
3.64
|
|
|
$
|
15.06
|
|
|
$
|
9.66
|
|
Net income per share - diluted
|
|
$
|
5.17
|
|
|
$
|
3.32
|
|
|
$
|
14.14
|
|
|
$
|
8.84
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||
(Shares in thousands)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||
Stock options
|
|
14,446
|
|
|
4,515
|
|
|
14,821
|
|
|
8,892
|
|
Restricted stock
|
|
—
|
|
|
—
|
|
|
57
|
|
|
—
|
|
|
|
Amortized
|
|
Unrealized
|
|
Fair
|
||||||||||
As of September 30, 2018
|
|
Cost Basis
|
|
Gains
|
|
Losses
|
|
Value
|
||||||||
Available-for-sale debt securities:
|
|
|
|
|
|
|
|
|
||||||||
Corporate bonds
|
|
$
|
2,562,051
|
|
|
$
|
2,316
|
|
|
$
|
(18,124
|
)
|
|
$
|
2,546,243
|
|
U.S. government and government agency obligations
|
|
112,046
|
|
|
25
|
|
|
(1,523
|
)
|
|
110,548
|
|
||||
Municipal bonds
|
|
2,068
|
|
|
—
|
|
|
(5
|
)
|
|
2,063
|
|
||||
Commercial paper
|
|
109,412
|
|
|
1
|
|
|
—
|
|
|
109,413
|
|
||||
Certificates of deposit
|
|
65,940
|
|
|
—
|
|
|
—
|
|
|
65,940
|
|
||||
|
|
$
|
2,851,517
|
|
|
$
|
2,342
|
|
|
$
|
(19,652
|
)
|
|
$
|
2,834,207
|
|
|
|
|
|
|
|
|
|
|
||||||||
As of December 31, 2017
|
|
|
|
|
|
|
|
|
||||||||
Available-for-sale debt securities:
|
|
|
|
|
|
|
|
|
||||||||
Corporate bonds
|
|
$
|
1,717,976
|
|
|
$
|
2,176
|
|
|
$
|
(7,672
|
)
|
|
$
|
1,712,480
|
|
U.S. government and government agency obligations
|
|
186,699
|
|
|
34
|
|
|
(1,241
|
)
|
|
185,492
|
|
||||
Municipal bonds
|
|
4,600
|
|
|
—
|
|
|
(13
|
)
|
|
4,587
|
|
||||
Commercial paper
|
|
106,973
|
|
|
—
|
|
|
—
|
|
|
106,973
|
|
||||
Certificates of deposit
|
|
11,024
|
|
|
—
|
|
|
—
|
|
|
11,024
|
|
||||
|
|
$
|
2,027,272
|
|
|
$
|
2,210
|
|
|
$
|
(8,926
|
)
|
|
$
|
2,020,556
|
|
|
|
September 30,
2018
|
|
December 31,
2017
|
||||
Maturities within one year
|
|
$
|
1,104,309
|
|
|
$
|
593,783
|
|
Maturities after one year through five years
|
|
1,729,898
|
|
|
1,426,773
|
|
||
|
|
$
|
2,834,207
|
|
|
$
|
2,020,556
|
|
|
Less than 12 Months
|
|
12 Months or Greater
|
|
Total
|
||||||||||||||||||
As of September 30, 2018
|
Fair Value
|
|
Unrealized Loss
|
|
Fair Value
|
|
Unrealized Loss
|
|
Fair Value
|
|
Unrealized Loss
|
||||||||||||
Corporate bonds
|
$
|
1,417,464
|
|
|
$
|
(10,946
|
)
|
|
$
|
406,594
|
|
|
$
|
(7,178
|
)
|
|
$
|
1,824,058
|
|
|
$
|
(18,124
|
)
|
U.S. government and government agency obligations
|
7,826
|
|
|
(202
|
)
|
|
95,690
|
|
|
(1,321
|
)
|
|
103,516
|
|
|
(1,523
|
)
|
||||||
Municipal bonds
|
—
|
|
|
—
|
|
|
998
|
|
|
(5
|
)
|
|
998
|
|
|
(5
|
)
|
||||||
|
$
|
1,425,290
|
|
|
$
|
(11,148
|
)
|
|
$
|
503,282
|
|
|
$
|
(8,504
|
)
|
|
$
|
1,928,572
|
|
|
$
|
(19,652
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
As of December 31, 2017
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Corporate bonds
|
$
|
930,970
|
|
|
$
|
(4,924
|
)
|
|
$
|
256,750
|
|
|
$
|
(2,748
|
)
|
|
$
|
1,187,720
|
|
|
$
|
(7,672
|
)
|
U.S. government and government agency obligations
|
110,532
|
|
|
(409
|
)
|
|
67,921
|
|
|
(832
|
)
|
|
178,453
|
|
|
(1,241
|
)
|
||||||
Municipal bonds
|
2,582
|
|
|
(10
|
)
|
|
2,005
|
|
|
(3
|
)
|
|
4,587
|
|
|
(13
|
)
|
||||||
|
$
|
1,044,084
|
|
|
$
|
(5,343
|
)
|
|
$
|
326,676
|
|
|
$
|
(3,583
|
)
|
|
$
|
1,370,760
|
|
|
$
|
(8,926
|
)
|
|
|
|
Fair Value Measurements at Reporting Date Using
|
||||||||
As of September 30, 2018
|
Fair Value
|
|
Quoted Prices in
Active Markets
for Identical
Assets
(Level 1)
|
|
Significant Other
Observable Inputs
(Level 2)
|
||||||
Available-for-sale debt securities:
|
|
|
|
|
|
||||||
Corporate bonds
|
$
|
2,546,243
|
|
|
—
|
|
|
$
|
2,546,243
|
|
|
U.S. government and government agency obligations
|
110,548
|
|
|
—
|
|
|
110,548
|
|
|||
Municipal bonds
|
2,063
|
|
|
—
|
|
|
2,063
|
|
|||
Commercial paper
|
109,413
|
|
|
—
|
|
|
109,413
|
|
|||
Certificates of deposit
|
65,940
|
|
|
—
|
|
|
65,940
|
|
|||
Equity securities (unrestricted)
|
90,445
|
|
|
$
|
90,445
|
|
|
—
|
|
||
Equity securities (restricted)
|
53,226
|
|
|
—
|
|
|
53,226
|
|
|||
|
$
|
2,977,878
|
|
|
$
|
90,445
|
|
|
$
|
2,887,433
|
|
|
|
|
|
|
|
||||||
As of December 31, 2017
|
|
|
|
|
|
||||||
Available-for-sale debt securities:
|
|
|
|
|
|
||||||
Corporate bonds
|
$
|
1,712,480
|
|
|
—
|
|
|
$
|
1,712,480
|
|
|
U.S. government and government agency obligations
|
185,492
|
|
|
—
|
|
|
185,492
|
|
|||
Municipal bonds
|
4,587
|
|
|
—
|
|
|
4,587
|
|
|||
Commercial paper
|
106,973
|
|
|
—
|
|
|
106,973
|
|
|||
Certificates of deposit
|
11,024
|
|
|
—
|
|
|
11,024
|
|
|||
Equity securities (unrestricted)
|
62,785
|
|
|
$
|
62,785
|
|
|
—
|
|
||
|
$
|
2,083,341
|
|
|
$
|
62,785
|
|
|
$
|
2,020,556
|
|
|
September 30,
|
|
December 31,
|
||||
|
2018
|
|
2017
|
||||
Raw materials
|
$
|
216,671
|
|
|
$
|
190,045
|
|
Work-in-process
|
435,671
|
|
|
302,042
|
|
||
Finished goods
|
28,397
|
|
|
21,791
|
|
||
Deferred costs
|
358,940
|
|
|
212,260
|
|
||
|
$
|
1,039,679
|
|
|
$
|
726,138
|
|
|
September 30,
|
|
December 31,
|
||||
|
2018
|
|
2017
|
||||
Interest rate swap contracts
|
$
|
75,000
|
|
|
$
|
75,000
|
|
Interest rate cap contracts
|
$
|
75,000
|
|
|
$
|
75,000
|
|
|
|
September 30,
|
|
September 30,
|
||||
|
|
2018
|
|
2017
|
||||
Cash and cash equivalents
|
|
$
|
1,087,843
|
|
|
$
|
792,065
|
|
Restricted cash included in Other noncurrent assets
|
|
12,500
|
|
|
12,500
|
|
||
Total cash, cash equivalents, and restricted cash shown in the Condensed Consolidated Statement of Cash Flows
|
|
$
|
1,100,343
|
|
|
$
|
804,565
|
|
ITEM 2.
|
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(In millions, except per share data)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenues
|
|
$
|
1,663.5
|
|
|
$
|
1,500.7
|
|
|
$
|
4,783.0
|
|
|
$
|
4,289.8
|
|
Net income
|
|
$
|
594.7
|
|
|
$
|
388.3
|
|
|
$
|
1,624.0
|
|
|
$
|
1,025.0
|
|
Net income per share - diluted
|
|
$
|
5.17
|
|
|
$
|
3.32
|
|
|
$
|
14.14
|
|
|
$
|
8.84
|
|
Net Product Sales of Regeneron-Discovered Products
(2)
|
|
Three Months Ended
September 30, |
||||||||||||||||||||||
(In millions)
|
|
2018
|
|
2017
|
||||||||||||||||||||
|
|
U.S.
|
|
ROW
(1)
|
|
Total
|
|
U.S.
|
|
ROW
(1)
|
|
Total
|
||||||||||||
EYLEA
(2)
|
|
$
|
1,021.8
|
|
|
$
|
654.6
|
|
|
$
|
1,676.4
|
|
|
$
|
953.3
|
|
|
$
|
563.7
|
|
|
$
|
1,517.0
|
|
ARCALYST
|
|
3.7
|
|
|
—
|
|
|
3.7
|
|
|
4.1
|
|
|
—
|
|
|
4.1
|
|
||||||
Net product sales recorded by Regeneron
|
|
$
|
1,025.5
|
|
|
|
|
|
|
|
|
$
|
957.4
|
|
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net product sales recorded by Sanofi
(2)
:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Dupixent
|
|
$
|
219.6
|
|
|
$
|
43.0
|
|
|
$
|
262.6
|
|
|
$
|
88.5
|
|
|
$
|
0.4
|
|
|
$
|
88.9
|
|
Praluent
|
|
$
|
48.4
|
|
|
$
|
31.8
|
|
|
$
|
80.2
|
|
|
$
|
31.8
|
|
|
$
|
17.6
|
|
|
$
|
49.4
|
|
Kevzara
|
|
$
|
19.9
|
|
|
$
|
5.0
|
|
|
$
|
24.9
|
|
|
$
|
2.6
|
|
|
$
|
0.4
|
|
|
$
|
3.0
|
|
ZALTRAP
|
|
$
|
1.5
|
|
|
$
|
23.8
|
|
|
$
|
25.3
|
|
|
$
|
3.0
|
|
|
$
|
18.7
|
|
|
$
|
21.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
|
Nine Months Ended
September 30, |
||||||||||||||||||||||
|
|
2018
|
|
2017
|
||||||||||||||||||||
|
|
U.S.
|
|
ROW
(1)
|
|
Total
|
|
U.S.
|
|
ROW
(1)
|
|
Total
|
||||||||||||
EYLEA
(2)
|
|
$
|
2,997.8
|
|
|
$
|
1,944.5
|
|
|
$
|
4,942.3
|
|
|
$
|
2,727.1
|
|
|
$
|
1,590.0
|
|
|
$
|
4,317.1
|
|
ARCALYST
|
|
12.0
|
|
|
—
|
|
|
12.0
|
|
|
12.6
|
|
|
—
|
|
|
12.6
|
|
||||||
Net product sales recorded by Regeneron
|
|
$
|
3,009.8
|
|
|
|
|
|
|
$
|
2,739.7
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net product sales recorded by Sanofi
(2)
:
|
|
|
|
|
|
|
|
|
||||||||||||||||
Dupixent
|
|
$
|
517.7
|
|
|
$
|
85.5
|
|
|
$
|
603.2
|
|
|
$
|
116.9
|
|
|
$
|
0.7
|
|
|
$
|
117.6
|
|
Praluent
|
|
$
|
121.6
|
|
|
$
|
92.0
|
|
|
$
|
213.6
|
|
|
$
|
89.8
|
|
|
$
|
41.6
|
|
|
$
|
131.4
|
|
Kevzara
|
|
$
|
48.1
|
|
|
$
|
13.3
|
|
|
$
|
61.4
|
|
|
$
|
3.4
|
|
|
$
|
0.4
|
|
|
$
|
3.8
|
|
ZALTRAP
|
|
$
|
6.6
|
|
|
$
|
73.4
|
|
|
$
|
80.0
|
|
|
$
|
7.6
|
|
|
$
|
51.0
|
|
|
$
|
58.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
(1)
Rest of world
|
||||||||||||||||||||||||
(2)
Bayer records net product sales of EYLEA outside the United States and Sanofi records global net product sales of Dupixent, Praluent, Kevzara, and ZALTRAP. Refer to "Overview" above and "Collaboration Agreements" below for further details.
|
Clinical Program
|
|
Phase 1
|
|
Phase 2
|
|
Phase 3
|
|
Regulatory Review
(i)
|
EYLEA
|
|
|
|
|
|
Non-proliferative diabetic retinopathy (NPDR) in patients without DME
|
|
Diabetic retinopathy (U.S.)
|
Dupixent (dupilumab)
(a)
Antibody to IL-4R alpha subunit
|
|
|
|
Grass allergy
|
|
Atopic dermatitis in adolescents and pediatrics (6–17 years of age)
(d)
|
|
Asthma in adults and adolescents (EU and Japan)
|
|
|
|
Peanut allergy
|
|
|
|||
|
|
|
|
|
Atopic dermatitis in pediatrics (6 months–5 years of age) (Phase 2/3)
(d)
|
|
Atopic dermatitis in adolescents (12–17 years of age) (U.S. and EU)
|
|
|
|
|
|
|
Asthma in pediatrics (6–11 years of age)
|
|
Auto-injector for 200 mg dose
|
|
|
|
|
|
|
Chronic rhinosinusitis with nasal polyps (CRSwNP)
|
|
|
|
|
|
|
|
|
|
Eosinophilic esophagitis (EOE) (Phase 2/3)
(c)
|
|
|
Praluent (alirocumab)
(a)
Antibody to PCSK9
|
|
|
|
|
|
Homozygous familial hypercholesterolemia (HoFH)
(c)
in adults and pediatrics
|
|
Cardiovascular risk reduction (U.S. and EU)
|
|
|
|
|
|
HeFH in pediatrics
|
|
First-line treatment of hyperlipidemia (U.S.)
|
|
Kevzara (sarilumab)
(a)
Antibody to IL-6R
|
|
|
|
Polyarticular-course juvenile idiopathic arthritis (pcJIA)
|
|
Polymyalgia rheumatica
|
|
|
|
|
|
|
Systemic juvenile idiopathic arthritis (sJIA)
|
|
|
|
|
Libtayo (cemiplimab)
(a)
Antibody to PD-1
(h)
|
|
Solid tumors and advanced hematologic malignancies
|
|
Metastatic or locally advanced and unresectable CSCC
(d)
|
|
First-line and second-line non-small cell lung cancer (NSCLC)
|
|
Metastatic or locally advanced CSCC (EU)
|
|
|
|
Basal cell carcinoma (BCC) (potentially pivotal study)
|
|
Second-line cervical cancer
|
|
|
|
Fasinumab
(b)(f)
(REGN475)
Antibody to NGF
|
|
|
|
|
|
Osteoarthritis of knee and hip
(e)
|
|
|
|
|
|
|
|
|
|
|
|
Clinical Program
(continued)
|
|
Phase 1
|
|
Phase 2
|
|
Phase 3
|
|
Regulatory Review
(i)
|
Evinacumab
(f)
(REGN1500)
Antibody to ANGPTL3
|
|
|
|
Refractory hypercholesterolemia (both HeFH and non-FH)
|
|
HoFH
(c)(d)
|
|
|
|
|
|
Severe hypertriglyceridemia
|
|
|
|
|
|
Garetosmab
(f)
(REGN2477)
Antibody to Activin A
|
|
Muscle-wasting diseases (in combination with trevogrumab)
|
|
Fibrodysplasia ossificans progressiva (FOP)
(c)(e)
(potentially pivotal study)
|
|
|
|
|
REGN3500
(a)
Antibody to IL-33. Studied as monotherapy and in combination with Dupixent.
|
|
|
|
Asthma
|
|
|
|
|
|
|
|
Chronic obstructive pulmonary disease (COPD)
|
|
|
|
|
|
Trevogrumab
(f)
(REGN1033)
Antibody to myostatin (GDF8)
|
|
Muscle-wasting diseases (in combination with garetosmab) (on clinical hold in the United States)
|
|
|
|
|
|
|
REGN1908-1909
(f)
Multi-antibody therapy to Feld1
|
|
Cat allergy
|
|
|
|
|
|
|
REGN1979
Bispecific antibody against CD20 and CD3
|
|
Certain B-cell malignancies (monotherapy and in combination with cemiplimab)
(c)
|
|
|
|
|
|
|
REGN-EB3
(g)
(REGN3470-3471-3479)
Multi-antibody therapy to Ebola virus
|
|
Ebola virus
infection
(c)
|
|
|
|
|
|
|
REGN3048-3051
(g)
Multi-antibody therapy to Middle East Respiratory Syndrome (MERS) virus
|
|
MERS virus infection
|
|
|
|
|
|
|
REGN3767
(a)
Antibody to LAG-3 protein
|
|
Advanced cancers (administered alone or in combination with cemiplimab)
|
|
|
|
|
|
|
Pozelimab
(f)
(REGN3918)
Antibody to C5
|
|
Paroxysmal nocturnal hemoglobinuria (PNH)
|
|
|
|
|
|
|
REGN4461
Agonist antibody to leptin receptor (LEPR)
|
|
Lipodystrophy and obesity
|
|
|
|
|
|
|
REGN4018
(a)
Bispecific antibody targeting MUC16 and CD3
|
|
Platinum-resistant ovarian cancer (administered alone or in combination with cemiplimab)
|
|
|
|
|
|
|
REGN4659
(a)
Antibody to CTLA4
|
|
Advanced NSCLC (administered alone or in combination with cemiplimab)
|
|
|
|
|
|
|
REGN5069
Antibody to GFRα3
|
|
Pain
|
|
|
|
|
|
|
(a)
In collaboration with Sanofi
|
||||
(b)
In collaboration with Teva and Mitsubishi Tanabe Pharma
|
||||
(c)
U.S. Food and Drug Administration (FDA) granted orphan drug designation
|
||||
(d)
FDA granted Breakthrough Therapy designation
|
||||
(e)
FDA granted Fast Track designation
|
||||
(f)
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 global sales of the product candidate.
|
||||
(g)
Sanofi did not opt-in to the product candidate. Under the terms of our agreement, Sanofi is entitled to receive royalties on any future sales of the product candidate. We and the Biomedical Advanced Research Development Authority (BARDA) of the U.S. Department of Health and Human Services (HHS) are parties to agreements whereby HHS provides certain funding to support research, development, and manufacturing of these antibodies.
|
||||
(h)
Studied as monotherapy and in combination with other antibodies and treatments
|
||||
(i)
Regulatory application submitted. Information in this column relates to U.S., EU, and Japan submissions only.
|
Clinical Program
|
|
2018 Events to Date
|
|
2018–2019 Plans (next 12 months)
|
EYLEA
|
|
Chinese State Food and Drug Administration (CFDA) approved EYLEA for DME and wet AMD
|
|
FDA decision on sBLA for the treatment of diabetic retinopathy (target action date of May 13, 2019)
|
|
Reported 24-week positive top-line results from Phase 3 PANORAMA study for the treatment of NPDR in patients without DME
|
|
Re-submission of Prior-Approval Supplement (PAS) for pre-filled syringe
|
|
|
|
Initiate a study of higher dose formulations of aflibercept
|
||
|
Reported that the Phase 3 PANORAMA study met its one-year primary endpoint and key secondary endpoints
|
|
|
|
|
Submitted sBLA for the treatment of diabetic retinopathy
|
|
|
|
|
FDA issued Complete Response Letter (CRL) regarding the sBLA for pre-filled syringe
|
|
|
|
|
Treat and Extend dosing regimen approved in the EU for wet AMD
|
|
|
|
|
|
FDA approved sBLA for every 12-week dosing regimen option after one year of effective therapy in patients with wet AMD
|
|
|
|
|
FDA approved sBLA for vial-only presentation
|
|
|
Dupixent (dupilumab; IL-4R Antibody)
|
|
Ministry of Health, Labor and Welfare (MHLW) in Japan approved Dupixent for the treatment of atopic dermatitis in adults not adequately controlled with existing therapies
|
|
FDA decision on sBLA for expanded atopic dermatitis indication in adolescent patients (12–17 years of age) (target action date of March 11, 2019)
|
|
|
Initiated Phase 2/3 study in pediatric patients (6 months–5 years of age) with severe atopic dermatitis
|
|
EMA decision on regulatory application for asthma
|
|
|
Reported positive results from Phase 3 study in adolescent patients (12–17 years of age) with atopic dermatitis
|
|
Submit sBLA for CRSwNP
|
|
|
FDA accepted for priority review sBLA for expanded atopic dermatitis indication in adolescent patients (12–17 years of age)
|
|
Initiate Phase 2/3 program in COPD
|
|
|
Submitted Marketing Authorization Application (MAA) for expanded atopic dermatitis indication in adolescent patients (12–17 years of age)
|
|
|
|
|
FDA approved sBLA for moderate-to-severe asthma in patients 12 years of age and older
|
|
|
|
|
Regulatory application for asthma accepted for review by the European Medicines Agency (EMA) and Pharmaceuticals and Medical Devices Agency (PMDA) in Japan
|
|
|
|
|
Positive results from two Phase 3 trials for the treatment of moderate-to-severe asthma published in the
New England Journal of Medicine
|
|
|
|
|
Initiated Phase 2 study in grass allergy
|
|
|
|
|
|
|
|
Net Income
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(In millions, except per share data)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Revenues
|
|
$
|
1,663.5
|
|
|
$
|
1,500.7
|
|
|
$
|
4,783.0
|
|
|
$
|
4,289.8
|
|
Operating expenses
|
|
(1,036.6
|
)
|
|
(940.7
|
)
|
|
(2,966.7
|
)
|
|
(2,749.0
|
)
|
||||
Other income (expense), net
|
|
9.0
|
|
|
5.7
|
|
|
61.0
|
|
|
(17.0
|
)
|
||||
Income before income taxes
|
|
635.9
|
|
|
565.7
|
|
|
1,877.3
|
|
|
1,523.8
|
|
||||
Income tax expense
|
|
(41.2
|
)
|
|
(177.3
|
)
|
|
(253.3
|
)
|
|
(498.8
|
)
|
||||
Net income
|
|
$
|
594.7
|
|
|
$
|
388.4
|
|
|
$
|
1,624.0
|
|
|
$
|
1,025.0
|
|
|
|
|
|
|
|
|
|
|
||||||||
Net income per share - diluted
|
|
$
|
5.17
|
|
|
$
|
3.32
|
|
|
$
|
14.14
|
|
|
$
|
8.84
|
|
Revenues
|
|
Three Months Ended
September 30, |
|
Increase
|
|
Nine Months Ended
September 30, |
|
Increase
|
||||||||||||||||
(In millions)
|
|
2018
|
|
2017
|
|
(Decrease)
|
|
2018
|
|
2017
|
|
(Decrease)
|
||||||||||||
Net product sales in the United States:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
EYLEA
|
|
$
|
1,021.8
|
|
|
$
|
953.3
|
|
|
$
|
68.5
|
|
|
$
|
2,997.8
|
|
|
$
|
2,727.1
|
|
|
$
|
270.7
|
|
ARCALYST
|
|
3.7
|
|
|
4.1
|
|
|
(0.4
|
)
|
|
12.0
|
|
|
12.6
|
|
|
(0.6
|
)
|
||||||
Sanofi and Bayer collaboration revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Sanofi
|
|
256.3
|
|
|
245.2
|
|
|
11.1
|
|
|
683.5
|
|
|
677.7
|
|
|
5.8
|
|
||||||
Bayer
|
|
264.4
|
|
|
236.6
|
|
|
27.8
|
|
|
775.2
|
|
|
640.9
|
|
|
134.3
|
|
||||||
Other revenue
|
|
117.3
|
|
|
61.5
|
|
|
55.8
|
|
|
314.5
|
|
|
231.5
|
|
|
83.0
|
|
||||||
Total revenues
|
|
$
|
1,663.5
|
|
|
$
|
1,500.7
|
|
|
$
|
162.8
|
|
|
$
|
4,783.0
|
|
|
$
|
4,289.8
|
|
|
$
|
493.2
|
|
(In millions)
|
Rebates, Chargebacks, and Discounts
|
|
Distribution-
Related
Fees
|
|
Other Sales-
Related
Deductions
|
|
Total
|
||||||||
Balance as of December 31, 2017
|
$
|
29.9
|
|
|
$
|
34.1
|
|
|
$
|
21.3
|
|
|
$
|
85.3
|
|
Provisions
|
48.5
|
|
|
51.7
|
|
|
11.2
|
|
|
111.4
|
|
||||
Credits/payments
|
(30.7
|
)
|
|
(42.0
|
)
|
|
(14.7
|
)
|
|
(87.4
|
)
|
||||
Balance as of March 31, 2018
|
47.7
|
|
|
43.8
|
|
|
17.8
|
|
|
109.3
|
|
||||
Provisions
|
49.2
|
|
|
50.4
|
|
|
8.7
|
|
|
108.3
|
|
||||
Credits/payments
|
(60.4
|
)
|
|
(56.5
|
)
|
|
(9.7
|
)
|
|
(126.6
|
)
|
||||
Balance as of June 30, 2018
|
36.5
|
|
|
37.7
|
|
|
16.8
|
|
|
91.0
|
|
||||
Provisions
|
61.4
|
|
|
53.4
|
|
|
9.8
|
|
|
124.6
|
|
||||
Credits/payments
|
(54.8
|
)
|
|
(52.4
|
)
|
|
(11.3
|
)
|
|
(118.5
|
)
|
||||
Balance as of September 30, 2018
|
$
|
43.1
|
|
|
$
|
38.7
|
|
|
$
|
15.3
|
|
|
$
|
97.1
|
|
|
|
|
|
|
|
|
|
||||||||
Balance as of December 31, 2016
|
$
|
12.7
|
|
|
$
|
29.5
|
|
|
$
|
3.6
|
|
|
$
|
45.8
|
|
Provisions
|
38.9
|
|
|
41.2
|
|
|
9.5
|
|
|
89.6
|
|
||||
Credits/payments
|
(28.5
|
)
|
|
(42.3
|
)
|
|
(8.6
|
)
|
|
(79.4
|
)
|
||||
Balance as of March 31, 2017
|
23.1
|
|
|
28.4
|
|
|
4.5
|
|
|
56.0
|
|
||||
Provisions
|
39.4
|
|
|
48.8
|
|
|
11.1
|
|
|
99.3
|
|
||||
Credits/payments
|
(39.4
|
)
|
|
(48.2
|
)
|
|
(12.7
|
)
|
|
(100.3
|
)
|
||||
Balance as of June 30, 2017
|
23.1
|
|
|
29.0
|
|
|
2.9
|
|
|
55.0
|
|
||||
Provisions
|
43.3
|
|
|
50.9
|
|
|
12.9
|
|
|
107.1
|
|
||||
Credits/payments
|
(40.9
|
)
|
|
(45.8
|
)
|
|
(0.1
|
)
|
|
(86.8
|
)
|
||||
Balance as of September 30, 2017
|
$
|
25.5
|
|
|
$
|
34.1
|
|
|
$
|
15.7
|
|
|
$
|
75.3
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(In millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Antibody:
|
|
|
|
|
|
|
|
|
||||||||
Reimbursement of Regeneron research and development expenses - Discovery Agreement
|
|
—
|
|
|
$
|
37.9
|
|
|
—
|
|
|
$
|
130.0
|
|
||
Reimbursement of Regeneron research and development expenses - License and Collaboration Agreement
|
|
$
|
76.2
|
|
|
90.6
|
|
|
$
|
201.0
|
|
|
291.1
|
|
||
Reimbursement of Regeneron commercialization-related expenses
|
|
103.7
|
|
|
90.3
|
|
|
292.8
|
|
|
251.0
|
|
||||
Regeneron's share of losses in connection with commercialization of antibodies
|
|
(38.9
|
)
|
|
(98.3
|
)
|
|
(182.6
|
)
|
|
(329.0
|
)
|
||||
Other
|
|
33.1
|
|
|
41.9
|
|
|
82.1
|
|
|
84.3
|
|
||||
Total Antibody
|
|
174.1
|
|
|
162.4
|
|
|
393.3
|
|
|
427.4
|
|
||||
Immuno-oncology:
|
|
|
|
|
|
|
|
|
||||||||
Reimbursement of Regeneron research and development expenses - Discovery Agreement
|
|
34.7
|
|
|
33.9
|
|
|
108.4
|
|
|
111.1
|
|
||||
Reimbursement of Regeneron research and development expenses - License and Collaboration Agreement
|
|
40.1
|
|
|
27.8
|
|
|
117.3
|
|
|
77.3
|
|
||||
Reimbursement of Regeneron commercialization-related expenses
|
|
3.2
|
|
|
1.1
|
|
|
6.5
|
|
|
1.9
|
|
||||
Other
|
|
4.2
|
|
|
20.0
|
|
|
58.0
|
|
|
60.0
|
|
||||
Total Immuno-oncology
|
|
82.2
|
|
|
82.8
|
|
|
290.2
|
|
|
250.3
|
|
||||
Total Sanofi collaboration revenue
|
|
$
|
256.3
|
|
|
$
|
245.2
|
|
|
$
|
683.5
|
|
|
$
|
677.7
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(In millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Regeneron's net profit in connection with commercialization of EYLEA outside the United States
|
|
$
|
243.2
|
|
|
$
|
205.4
|
|
|
$
|
721.5
|
|
|
$
|
571.1
|
|
Reimbursement of Regeneron development expenses
|
|
0.5
|
|
|
13.4
|
|
|
8.3
|
|
|
26.4
|
|
||||
Other
|
|
20.7
|
|
|
17.8
|
|
|
45.4
|
|
|
43.4
|
|
||||
|
|
$
|
264.4
|
|
|
$
|
236.6
|
|
|
$
|
775.2
|
|
|
$
|
640.9
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(In millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Net product sales outside the United States
|
|
$
|
654.6
|
|
|
$
|
563.7
|
|
|
$
|
1,944.5
|
|
|
$
|
1,590.0
|
|
Regeneron's share of collaboration profit from sales outside the United States
|
|
$
|
256.7
|
|
|
$
|
218.5
|
|
|
$
|
761.1
|
|
|
$
|
611.7
|
|
Reimbursement of development expenses incurred by Bayer in accordance with Regeneron's payment obligation
|
|
(13.5
|
)
|
|
(13.1
|
)
|
|
(39.6
|
)
|
|
(40.6
|
)
|
||||
Regeneron's net profit in connection with commercialization of EYLEA outside the United States
|
|
$
|
243.2
|
|
|
$
|
205.4
|
|
|
$
|
721.5
|
|
|
$
|
571.1
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(In millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Teva collaboration revenue:
|
|
|
|
|
|
|
|
|
||||||||
Reimbursement of Regeneron research and development expenses
|
|
$
|
27.6
|
|
|
$
|
28.5
|
|
|
$
|
101.1
|
|
|
$
|
82.1
|
|
Other
|
|
41.5
|
|
|
11.7
|
|
|
95.5
|
|
|
58.9
|
|
||||
Total Teva collaboration revenue
|
|
69.1
|
|
|
40.2
|
|
|
196.6
|
|
|
141.0
|
|
||||
Other revenue
|
|
48.2
|
|
|
21.3
|
|
|
117.9
|
|
|
90.5
|
|
||||
Total other revenue
|
|
$
|
117.3
|
|
|
$
|
61.5
|
|
|
$
|
314.5
|
|
|
$
|
231.5
|
|
•
|
Recognition of a portion of deferred revenue from up-front and other payments received from MTPC, including a portion related to the achievement of a $20.0 development milestone in the third quarter of 2018, and, in the nine-month period ended September 30, 2017, recognition of a substantive development milestone of $30.0 million from MTPC, in connection with our fasinumab collaboration.
|
•
|
Sanofi's reimbursement for manufacturing commercial supplies of ZALTRAP and a percentage of aggregate net sales of ZALTRAP under the terms of the Amended ZALTRAP Agreement.
|
•
|
Recognition of revenue related to the $165.0 million up-front payment we received in August 2010, which was deferred upon receipt and was being recognized as revenue through mid-2018, in connection with the
VelocImmune
license agreement with Astellas. In accordance with the terms of the license agreement, Astellas terminated the agreement effective June 2018.
|
•
|
Royalties in connection with a June 2009 agreement with Novartis, under which we receive royalties on worldwide sales of Novartis' Ilaris
®
(canakinumab). The royalty rates in the agreement start at 4% and reach 15% when annual sales exceed $1.5 billion, and we are entitled to royalties until Novartis ceases sale of products subject to royalty.
|
•
|
Recognition of revenue in connection with our agreement with BARDA to develop, test, and manufacture an antibody therapy (REGN3470-3471-3479) for the treatment of Ebola virus infection.
|
|
|
Three Months Ended
September 30, |
|
Increase
|
|
Nine Months Ended
September 30, |
|
Increase
|
||||||||||||||||
(In millions)
|
|
2018
|
|
2017
|
|
(Decrease)
|
|
2018
|
|
2017
|
|
(Decrease)
|
||||||||||||
Research and development
|
|
$
|
557.0
|
|
|
$
|
529.7
|
|
|
$
|
27.3
|
|
|
$
|
1,584.8
|
|
|
$
|
1,547.2
|
|
|
$
|
37.6
|
|
Selling, general, and administrative
|
|
369.2
|
|
|
306.8
|
|
|
62.4
|
|
|
1,064.9
|
|
|
910.5
|
|
|
154.4
|
|
||||||
Cost of goods sold
|
|
30.8
|
|
|
46.4
|
|
|
(15.6
|
)
|
|
136.1
|
|
|
149.8
|
|
|
(13.7
|
)
|
||||||
Cost of collaboration and contract manufacturing
|
|
79.6
|
|
|
57.8
|
|
|
21.8
|
|
|
180.9
|
|
|
141.5
|
|
|
39.4
|
|
||||||
Total operating expenses
|
|
$
|
1,036.6
|
|
|
$
|
940.7
|
|
|
$
|
95.9
|
|
|
$
|
2,966.7
|
|
|
$
|
2,749.0
|
|
|
$
|
217.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Average headcount
|
|
7,147
|
|
|
5,875
|
|
|
1,272
|
|
|
6,763
|
|
|
5,653
|
|
|
1,110
|
|
|
|
Three Months Ended
September 30, |
|
Increase
|
|
Nine Months Ended
September 30, |
|
Increase
|
||||||||||||||||
(In millions)
|
|
2018
|
|
2017
|
|
(Decrease)
|
|
2018
|
|
2017
|
|
(Decrease)
|
||||||||||||
Direct research and development expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Dupixent (dupilumab)
|
|
$
|
36.4
|
|
|
$
|
50.0
|
|
|
$
|
(13.6
|
)
|
|
$
|
106.8
|
|
|
$
|
150.0
|
|
|
$
|
(43.2
|
)
|
Libtayo (cemiplimab)
|
|
53.0
|
|
|
33.7
|
|
|
19.3
|
|
|
129.9
|
|
|
78.3
|
|
|
51.6
|
|
||||||
Fasinumab
|
|
38.7
|
|
|
39.1
|
|
|
(0.4
|
)
|
|
152.8
|
|
|
112.0
|
|
|
40.8
|
|
||||||
Praluent (alirocumab)
|
|
16.4
|
|
|
21.2
|
|
|
(4.8
|
)
|
|
47.6
|
|
|
61.1
|
|
|
(13.5
|
)
|
||||||
Other product candidates in clinical development and other research programs
|
|
85.2
|
|
|
74.6
|
|
|
10.6
|
|
|
198.2
|
|
|
207.4
|
|
|
(9.2
|
)
|
||||||
Total direct research and development expenses
|
|
229.7
|
|
|
218.6
|
|
|
11.1
|
|
|
635.3
|
|
|
608.8
|
|
|
26.5
|
|
||||||
Indirect research and development expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Payroll and benefits
|
|
152.8
|
|
|
145.3
|
|
|
7.5
|
|
|
433.5
|
|
|
438.5
|
|
|
(5.0
|
)
|
||||||
Clinical manufacturing costs
|
|
85.6
|
|
|
97.7
|
|
|
(12.1
|
)
|
|
258.8
|
|
|
300.9
|
|
|
(42.1
|
)
|
||||||
Lab supplies, licensing, and other research and development costs
|
|
25.4
|
|
|
17.1
|
|
|
8.3
|
|
|
71.3
|
|
|
47.1
|
|
|
24.2
|
|
||||||
Occupancy and other operating costs
|
|
63.5
|
|
|
51.0
|
|
|
12.5
|
|
|
185.9
|
|
|
151.9
|
|
|
34.0
|
|
||||||
Total indirect research and development expenses
|
|
327.3
|
|
|
311.1
|
|
|
16.2
|
|
|
949.5
|
|
|
938.4
|
|
|
11.1
|
|
||||||
Total research and development expenses
|
|
$
|
557.0
|
|
|
$
|
529.7
|
|
|
$
|
27.3
|
|
|
$
|
1,584.8
|
|
|
$
|
1,547.2
|
|
|
$
|
37.6
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
(In millions)
|
|
2018
|
|
2017
|
|
2018
|
|
2017
|
||||||||
Income tax expense
|
|
$
|
41.2
|
|
|
$
|
177.3
|
|
|
$
|
253.3
|
|
|
$
|
498.8
|
|
Effective tax rate
|
|
6.5
|
%
|
|
31.3
|
%
|
|
13.5
|
%
|
|
32.7
|
%
|
|
September 30,
|
|
December 31,
|
|
Increase
|
||||||
(In millions)
|
2018
|
|
2017
|
|
(Decrease)
|
||||||
Financial assets:
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
1,087.8
|
|
|
$
|
812.7
|
|
|
$
|
275.1
|
|
Marketable securities - current
|
1,104.3
|
|
|
596.8
|
|
|
507.5
|
|
|||
Marketable securities - noncurrent
|
1,873.6
|
|
|
1,486.5
|
|
|
387.1
|
|
|||
|
$
|
4,065.7
|
|
|
$
|
2,896.0
|
|
|
$
|
1,169.7
|
|
|
|
|
|
|
|
||||||
Working capital:
|
|
|
|
|
|
||||||
Current assets
|
$
|
5,719.6
|
|
|
$
|
4,335.0
|
|
|
$
|
1,384.6
|
|
Current liabilities
|
1,417.2
|
|
|
1,135.5
|
|
|
281.7
|
|
|||
|
$
|
4,302.4
|
|
|
$
|
3,199.5
|
|
|
$
|
1,102.9
|
|
|
September 30,
|
|
September 30,
|
|
Increase
|
||||||
(In millions)
|
2018
|
|
2017
|
|
(Decrease)
|
||||||
Cash flows provided by operating activities
|
$
|
1,466.3
|
|
|
$
|
740.2
|
|
|
$
|
726.1
|
|
Cash flows used in investing activities
|
$
|
(1,197.1
|
)
|
|
$
|
(669.4
|
)
|
|
$
|
(527.7
|
)
|
Cash flows provided by financing activities
|
$
|
5.9
|
|
|
$
|
186.1
|
|
|
$
|
(180.2
|
)
|
•
|
effectiveness of the commercial strategy in and outside the United States for the marketing of our products, including pricing strategy;
|
•
|
sufficient coverage of, and reimbursement for, our marketed products by third-party payers, including Medicare and Medicaid in the United States and other government and private payers in the United States and foreign jurisdictions, as well as payer restrictions on eligible patient populations and the reimbursement process, both in the United States and abroad;
|
•
|
our ability and our collaborators' ability to maintain sales of our marketed products in the face of competitive products and to differentiate our marketed products from competitive products, including as applicable product candidates currently in clinical development; and, in the case of EYLEA, the willingness of retinal specialists and patients to switch from Lucentis
®
(ranibizumab) or off-label use of repackaged Avastin
®
(bevacizumab) to EYLEA or to start treatment with EYLEA;
|
•
|
maintaining and successfully monitoring commercial manufacturing arrangements for our marketed products with third parties who perform fill/finish or other steps in the manufacture of such products to ensure that they meet our standards and those of regulatory authorities, including the FDA, which extensively regulate and monitor pharmaceutical manufacturing facilities;
|
•
|
our ability to meet the demand for commercial supplies of our marketed products;
|
•
|
the outcome of the pending patent infringement proceedings relating to EYLEA, Dupixent, and Praluent (described further in Note 11 to our Condensed Consolidated Financial Statements included in this report), and other risks relating to our marketed products associated with intellectual property of other parties and pending or future litigation relating thereto, as discussed under "Risks Related to Intellectual Property and Market Exclusivity" below;
|
•
|
the results of post-approval studies, whether conducted by us or by others and whether mandated by regulatory agencies or voluntary, and studies of other products that could implicate an entire class of products or are perceived to do so; and
|
•
|
the effect of existing and new health care laws and regulations currently being considered or implemented in the United States, including reporting and disclosure requirements of such laws and regulations and the potential impact of such requirements on physician prescription practices.
|
•
|
changes in the FDA and foreign regulatory processes for new therapeutics that may delay or prevent the approval of any of our current or future product candidates;
|
•
|
new laws, regulations, or judicial decisions related to healthcare availability or the payment for healthcare products and services, including prescription drugs, that would make it more difficult for us to market and sell products once they are approved by the FDA or foreign regulatory agencies;
|
•
|
changes in FDA and foreign regulations that may require additional safety monitoring prior to or after the introduction of new products to market, which could materially increase our costs of doing business; and
|
•
|
changes in FDA and foreign cGMPs that may make it more difficult and costly for us to maintain regulatory compliance and/or manufacture our marketed product and product candidates in accordance with cGMPs.
|
•
|
unfamiliar foreign laws or regulatory requirements or unexpected changes to those laws or requirements;
|
•
|
other laws and regulatory requirements to which our business activities abroad are subject, such as the FCPA and the U.K. Bribery Act (discussed in greater detail above under "
Risks from the improper conduct of employees, agents, contractors, or collaborators could adversely affect our reputation and our business, prospects, operating results, and financial condition
");
|
•
|
changes in the political or economic condition of a specific country or region;
|
•
|
fluctuations in the value of foreign currency versus the U.S. dollar;
|
•
|
our ability to deploy overseas funds in an efficient manner;
|
•
|
tariffs, trade protection measures, import or export licensing requirements, trade embargoes, and sanctions (including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury), and other trade barriers;
|
•
|
difficulties in attracting and retaining qualified personnel; and
|
•
|
cultural differences in the conduct of business.
|
•
|
net product sales of our marketed products (as recorded by us or our collaborators), in particular EYLEA, Dupixent, and Libtayo, as well as our overall operating results;
|
•
|
if any of our product candidates or our new indications for our marketed products receive regulatory approval, net product sales of, and profits from, these product candidates and new indications;
|
•
|
market acceptance of, and the market share for, our marketed products, especially EYLEA, Dupixent, and Libtayo;
|
•
|
whether our net product sales and net profits underperform, meet, or exceed the expectations of investors or analysts;
|
•
|
announcement of actions by the FDA or foreign regulatory authorities or their respective advisory committees regarding our, or our collaborators', or our competitors', currently pending or future application(s) for regulatory approval of product candidate(s) or new indications for marketed products;
|
•
|
announcement of submission of an application for regulatory approval of one or more of our, or our competitors', product candidates or new indications for marketed products;
|
•
|
progress, delays, or results in clinical trials of our or our competitors' product candidates or new indications for marketed products;
|
•
|
announcement of technological innovations or product candidates by us or competitors;
|
•
|
claims by others that our products or technologies infringe their patents;
|
•
|
challenges by others to our patents in the EPO and in the USPTO;
|
•
|
public concern as to the safety or effectiveness of any of our marketed products or product candidates or new indications for our marketed products;
|
•
|
pricing or reimbursement actions, decisions, or recommendations by government authorities, insurers, or other organizations (such as health maintenance organizations and pharmacy benefit management companies) affecting the coverage, reimbursement, or use of any of our marketed products or competitors' products;
|
•
|
our ability to raise additional capital as needed on favorable terms;
|
•
|
developments in our relationships with collaborators or key customers;
|
•
|
developments in the biotechnology industry or in government regulation of healthcare, including those relating to compounding (
i.e.
, a practice in which a pharmacist, a physician, or, in the case of an outsourcing facility, a person under the supervision of a pharmacist, combines, mixes, or alters ingredients of a drug to create a medication tailored to the needs of an individual patient);
|
•
|
large sales of our Common Stock by our executive officers, directors, or significant shareholders;
|
•
|
changes in tax rates, laws, or interpretation of tax laws;
|
•
|
arrivals and departures of key personnel;
|
•
|
general market conditions;
|
•
|
trading activity that results from the rebalancing of stock indices in which our Common Stock is included, or the inclusion or exclusion of our Common Stock from such indices;
|
•
|
other factors identified in these "Risk Factors"; and
|
•
|
the perception by the investment community or our shareholders of any of the foregoing factors.
|
•
|
our current executive officers and directors beneficially owned
9.5%
of our outstanding shares of Common Stock, assuming conversion of their Class A Stock into Common Stock and the exercise of all options held by such persons which are exercisable within 60 days of
September 30, 2018
, and
20.3%
of the combined voting power of our outstanding shares of Common Stock and Class A Stock, assuming the exercise of all options held by such persons which are exercisable within 60 days of
September 30, 2018
; and
|
•
|
our five largest shareholders plus Dr. Schleifer, our Chief Executive Officer, beneficially owned approximately
43.9%
of our outstanding shares of Common Stock, assuming, in the case of our Chief Executive Officer, the conversion of his Class A Stock into Common Stock and the exercise of all options held by him which are exercisable within 60 days of
September 30, 2018
. In addition, these five shareholders plus our Chief Executive Officer held approximately
50.1%
of the combined voting power of our outstanding shares of Common Stock and Class A Stock, assuming the exercise of all options held by our Chief Executive Officer which are exercisable within 60 days of
September 30, 2018
.
|
•
|
authorization to issue "blank check" preferred stock, which is preferred stock that can be created and issued by the board of directors without prior shareholder approval, with rights senior to those of our Common Stock and Class A Stock;
|
•
|
a staggered board of directors, so that it would take three successive annual shareholder meetings to replace all of our directors;
|
•
|
a requirement that removal of directors may only be effected for cause and only upon the affirmative vote of at least eighty percent (80%) of the outstanding shares entitled to vote for directors, as well as a requirement that any vacancy on the board of directors may be filled only by the remaining directors;
|
•
|
a provision whereby any action required or permitted to be taken at any meeting of shareholders may be taken without a meeting, only if, prior to such action, all of our shareholders consent, the effect of which is to require that shareholder action may only be taken at a duly convened meeting;
|
•
|
a requirement that any shareholder seeking to bring business before an annual meeting of shareholders must provide timely notice of this intention in writing and meet various other requirements; and
|
•
|
under the New York Business Corporation Law, in addition to certain restrictions which may apply to "business combinations" involving our Company and an "interested shareholder," a plan of merger or consolidation of our Company must be approved by two-thirds of the votes of all outstanding shares entitled to vote thereon. See the risk factor above captioned "
Our existing shareholders may be able to exert significant influence over matters requiring shareholder approval and over our management.
"
|
Period
|
|
Total Number of Shares (or Units) Purchased
|
|
Average Price Paid per Share (or Unit)
|
|
Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs
|
|
Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs
|
|||||
|
|
|
|
|
|
|
|
|
|||||
9/1/2018–9/30/2018
|
|
2,590
|
|
|
$
|
394.53
|
|
|
—
|
|
|
—
|
|
Period
|
|
Total Number of Shares (or Units) Purchased
|
|
Average Price Paid per Share (or Unit)
|
|
Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs
|
|
Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs
|
|||||
|
|
|
|
|
|
|
|
|
|||||
9/1/2018–9/30/2018
|
|
104,552
|
|
|
$
|
406.68
|
|
|
—
|
|
|
—
|
|
Exhibit Number
|
|
Description
|
31.1
|
|
|
31.2
|
|
|
32
|
|
|
101
|
|
Interactive Data File
|
101.INS
|
|
XBRL Instance Document
|
101.SCH
|
|
XBRL Taxonomy Extension Schema
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Document
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase
|
______
|
|
|
|
|
|
|
|
|
REGENERON PHARMACEUTICALS, INC.
|
|
|
|
|
|
|
|
|
Date:
|
November 6, 2018
|
|
By:
|
/s/ Robert E. Landry
|
|
|
|
|
|
|
|
|
|
|
|
Robert E. Landry
|
|
|
|
|
|
Senior Vice President, Finance and
|
|
|
|
|
|
Chief Financial Officer
|
|
|
|
|
|
(Duly Authorized Officer)
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Regeneron Pharmaceuticals, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
November 6, 2018
|
/s/ Leonard S. Schleifer
|
|
|
|
Leonard S. Schleifer, M.D., Ph.D.
|
|
|
|
President and Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
|
|
1.
|
I have reviewed this quarterly report on Form 10-Q of Regeneron Pharmaceuticals, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date:
|
November 6, 2018
|
/s/ Robert E. Landry
|
|
|
|
Robert E. Landry
|
|
|
|
Senior Vice President, Finance and Chief Financial Officer
|
|
|
|
(Principal Financial Officer)
|
|
|
(1)
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
/s/ Leonard S. Schleifer
|
Leonard S. Schleifer, M.D., Ph.D.
|
President and Chief Executive Officer
|
(Principal Executive Officer)
|
November 6, 2018
|
|
/s/ Robert E. Landry
|
Robert E. Landry
|
Senior Vice President, Finance and Chief Financial Officer
|
(Principal Financial Officer)
|
November 6, 2018
|