Biogen Inc. (BIIB) Q4 2025 Earnings Call Transcript
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Overview
The earnings call highlights steady revenue growth and promising product development, but concerns remain. The Q&A reveals uncertainties in product launches and market strategy, with unclear guidance on share buybacks and financials. Despite strong pipeline prospects, the lack of specific margin details and the focus on long-term development may temper immediate investor enthusiasm. Overall, the sentiment is mixed, leading to a neutral rating.
Key Financial Performance
Growth Products Revenue Generated $3.3 billion in fiscal '25, up 19% year-over-year. The increase is attributed to intelligent investments and the inclusion of VUMERITY in the growth products category.
Revenue from Products Launched Since 2023 Generated around $1 billion in revenue, showing strong growth. This includes products like LEQEMBI, SKYCLARYS, ZURZUVAE, and QALSODY.
MS Business Revenue Generated $3 billion in fiscal '25. Despite being a mature segment, it continues to perform well.
LEQEMBI In-Market Sales Approximately $134 million in Q4 2025, up 10% sequentially and 54% year-over-year. Growth driven by steady demand globally.
SKYCLARYS Revenue $133 million in Q4 2025, representing 30% growth year-over-year. Sequential growth in the U.S. was $14 million, benefiting from $9 million of favorable inventory dynamics.
SPINRAZA Revenue $356 million in Q4 2025. U.S. revenue grew year-over-year to $169 million. Full-year revenue was down 2% year-over-year, showing resilience in a competitive market.
VUMERITY Revenue $181 million in Q4 2025, with 19% year-over-year growth for the full year, driven by improved affordability in the U.S. with the IRA Part D redesign.
TYSABRI Revenue $398 million in Q4 2025. U.S. revenue was $244 million, while ex-U.S. revenue was $153 million. Resilience shown despite biosimilar competition in the EU.
Anti-CD20 Therapeutic Programs Revenue $521 million in Q4 2025, up 12% year-over-year, driven by royalties from OCREVUS and the subcutaneous launch.
Total Revenue $9.9 billion for the full year 2025, up 2% year-over-year. Growth attributed to strong performance of growth products and resilient MS business.
Free Cash Flow $2.1 billion for the full year 2025, supported by strong commercial execution and disciplined expense management.
Cash and Marketable Securities $4.2 billion at the end of 2025, strengthening the balance sheet and providing flexibility for strategic investments.
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Operating Highlights
Growth Products Revenue: Generated $3.3 billion in fiscal '25, up 19%.
New Product Launches: Products launched since 2023 (LEQEMBI, SKYCLARYS, ZURZUVAE, QALSODY) generated around $1 billion in revenue.
LEQEMBI Market Leadership: LEQEMBI holds over 60% of the anti-amyloid therapy market share.
SPINRAZA High Dose: Launched in Japan with early signs of exceeding expectations.
ZURZUVAE Growth: Sales more than doubled in 2025, highlighting the burden of postpartum depression.
SKYCLARYS Expansion: Approved in Brazil and launching globally except in Asia.
LEQEMBI Expansion: Regulatory filings underway in Japan and China for IQLIK initiation.
SKYCLARYS Global Launch: Expanding to new markets globally except Asia.
Pipeline Expansion: Significant pipeline growth in 2025 with new assets and collaborations.
Business Development: Acquired Alcyone Therapeutics and collaborations with Vanqua and Dayra Therapeutics.
Operational Efficiency: Cost reduction measures and disciplined expense management led to robust cash flow of $2.1 billion in 2025.
Focus on Early-Stage Pipeline: Investing in high-risk, high-reward projects like LRRK2 in Parkinson's and anti-tau ASO.
Strategic Investments: Prelaunch activities for lupus and nephrology portfolio to support future growth.
Shift to Growth Products: Revenue from growth products exceeded MS business revenue in Q4 2025.
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Risk or Challenges
Regulatory and Competitive Pressures: The company faces regulatory hurdles, including the need for FDA approvals for key products like LEQEMBI and SPINRAZA. Competitive pressures in the MS market are expected to lead to a mid-teen percentage revenue decline in 2026.
Supply Chain and Reimbursement Challenges: Reimbursement for LEQEMBI IQLIK under Part D will not be fully available until 2027, creating potential financial strain. Additionally, the timing of shipments for products like SPINRAZA and SKYCLARYS can distort revenue trends.
Market Creation and Adoption: The company must create markets for new products like ZURZUVAE and SKYCLARYS, which involves significant investment and effort. For example, postpartum depression remains highly undiagnosed, limiting the immediate market for ZURZUVAE.
Operational and Strategic Execution Risks: The company is investing heavily in prelaunch activities for lupus and nephrology portfolios, which could strain resources if not executed effectively. Additionally, the need to build up the early-stage pipeline adds to operational complexity.
Economic and Financial Risks: The company expects a mid-single-digit percentage decline in total revenue for 2026, driven by competitive pressures and market dynamics. This could impact financial stability and shareholder value.
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Guidance & Outlook
LEQEMBI IQLIK Approval: Expected FDA decision for subcutaneous AI initiation on May 24, 2026. Regulatory filings are also underway in Japan and China.
SPINRAZA High Dose Approval: Awaiting regulatory decision in the U.S. with a PDUFA date in April 2026. High-dose approval already achieved in Europe and Japan.
Litifilimab Phase III Data: Phase III data in systemic lupus erythematosus (SLE) expected by the end of 2026. Phase II/III data for cutaneous lupus erythematosus (CLE) expected mid-2027.
Felzartamab in AMR: Data expected in 2027 for antibody-mediated rejection (AMR).
LEQEMBI Preclinical Study: Fully recruited study with results expected in 2028, focusing on early-stage Alzheimer's patients to assess prevention or delay of symptoms.
Revenue Guidance for 2026: Total revenue expected to decline by a mid-single-digit percentage compared to 2025. MS product revenue (excluding VUMERITY) expected to decline by a mid-teen percentage.
Growth Products: Continued focus on growth products like LEQEMBI, SPINRAZA, ZURZUVAE, and SKYCLARYS, with expectations of steady growth and market expansion.
Pre-POC Pipeline: Data readouts expected in 2026 for BIIB122 in Parkinson's disease and BIIB080 in early Alzheimer's disease. Additional INDs anticipated over the next 18 months.
Operational Focus for 2026: Strategic investments in lupus and nephrology prelaunch activities while maintaining core operating expenses consistent with 2025.
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Shareholder Return Plan
The selected topic was not discussed during the call.
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Key Q&A
Q:Can you walk us through how to think about the cadence of sales growth for LEQEMBI this year?
A:The company does not have clear data on how many patients go on to maintenance but estimates a persistency of about 70%. Most patients are on monthly infusions after the plaque removal period. There is a progressive uptake of the subcutaneous pen, but full reimbursement is pending. Growth is expected to be linear quarter-on-quarter, with potential acceleration in the latter half of the year or 2027, contingent on full reimbursement for subcutaneous pens.
Q:When do you think Biogen's top line could return to growth?
A:Growth products have outpaced declines in the MS portfolio in the past two years. However, further erosion is expected due to TECFIDERA generic erosion in Europe and the introduction of a TYSABRI biosimilar. Growth depends on positive Phase III results and product launches, such as litifilimab and AMR in 2028. Business development opportunities are being explored, but acquisitions must provide shareholder value. The company has high conviction in its late-stage pipeline.
Q:What is the commercial opportunity for BIIB080 in Alzheimer's?
A:The neurology community is closely watching BIIB080 data, as tau is considered an important target in Alzheimer's. BIIB080 can reduce tau, but the impact on cognition and side effects need to be evaluated. If positive, the neurology community is expected to be excited, but a Phase III program would be required, delaying commercialization by several years.
Q:How important are subgroups and tau sub-studies for BIIB080?
A:Subgroups and tau sub-studies are very important. The study includes tau PET, fluid biomarkers, and clinical data trends. A tau sub-study is included, testing three doses and two dosing regimens in a randomized controlled trial. This will provide comprehensive insights into the scientific hypothesis.
Q:What leads you to have high conviction in litifilimab despite mixed Phase II data?
A:Litifilimab targets the BDCA2 pathway, which regulates immune response and the type 1 interferon signature pathway. Phase II data showed proof of concept in systemic and cutaneous lupus. Phase III trials are designed to confirm these findings, with primary endpoints capturing disease activity. The company remains optimistic but awaits readouts at the end of the year for SLE and mid-next year for CLE.
Q:How important is the eGFR endpoint for felzartamab, and why limit development to kidney transplant AMR?
A:The eGFR endpoint is important, but the primary endpoint is the main focus. The company is encouraged by Phase II results showing a >80% effect. Other transplants are being evaluated internally, and physicians are experimenting with CD38 in heart transplants. A sister trial for microvascular inflammation is also being initiated.
Q:What could HD SPINRAZA approval in the U.S. mean for top-line growth in 2026?
A:Initial results from Japan show higher-than-expected adoption and switchbacks. Increased efficacy levels may lead to higher sales, but the pace of physician transitions remains uncertain. The launch is considered important and has strong support from patient advocacy groups and physicians.
Q:How will Biogen redeploy commercial infrastructure for lupus and nephrology launches?
A:Biogen is building capabilities in new areas like transplant nephrology, rheumatology, and epileptology. The company is recruiting experienced talent and investing in market research. No major changes in OpEx trajectory are expected, as resources are being reallocated from legacy businesses to growth products.
Q:What is the steady-state target for LEQEMBI's product margin?
A:Specific product margins for LEQEMBI are not disclosed. Margins are expected to improve over time with revenue growth and manufacturing enhancements. Current investments in R&D and market creation are significant, but margin expansion will depend on revenue growth.
Q:Is this the right time for a share buyback or return of capital to shareholders?
A:The company is focused on deploying capital for long-term shareholder growth, primarily through business development transactions. Share buybacks are not ruled out but are not the current priority.
Q:What are the priorities for Biogen's early-stage pipeline?
A:Biogen focuses on areas with lower risk, such as ALS and Alzheimer's, leveraging biomarkers like neurofilament. The company is expanding into immunology, targeting rare diseases initially and exploring broader opportunities in earlier stages. Cost efficiency and derisked safety are key considerations.
Q:What was the magnitude of the one-time reimbursement true-up for SKYCLARYS, and how should the European rollout of ZURZUVAE be modeled?
A:The one-time reimbursement true-up for SKYCLARYS was $12 million, related to two European countries. ZURZUVAE's European rollout will be selective, targeting 3-4 countries due to pricing considerations. The company is mindful of the MFN environment and will prioritize high-value markets.
Q:Review of Unclear Management Responses
A:Management avoided providing specific product margin details for LEQEMBI, citing ongoing investments in R&D and market creation. They also did not provide a clear timeline for when Biogen's top line would return to growth, emphasizing uncertainties in product launches and business development opportunities. Additionally, they did not elaborate on the potential impact of share buybacks or provide detailed financial guidance for new product rollouts.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
American
BIIB
BTK degrader
CLE
INDs
IQLIK opportunity
Japan China
LEQEMBI
PDUFA date
Phase II
Phase III
Priya
SLE end
Society
VUMERITY
ZURZUVAE
breakthrough designation
chart
degrader clinic
intrathecal
litifilimab SLE
lupus
market leader
month litifilimab
neuron
persistency
point view
postpartum depression
priority review
risk reward
story
year month
BIIB Transcript
Biogen Inc. (BIIB) Q4 2025 Earnings Call Transcript
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The earnings call highlights steady revenue growth and promising product development, but concerns remain. The Q&A reveals uncertainties in product launches and market strategy, with unclear guidance on share buybacks and financials. Despite strong pipeline prospects, the lack of specific margin details and the focus on long-term development may temper immediate investor enthusiasm. Overall, the sentiment is mixed, leading to a neutral rating.
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