Good morning. My name is Shelby and I will be your conference operator today. At this time, I would like to welcome everyone to the Biogen Third Quarter 2021 earnings call and financial update. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question-and-answer session. If you'd like to ask a question during this time, please follow the operator's instructions. Please limit yourself to one question to allow all participants time for questions. If you require any further follow-ups, please follow the operator's instructions. Thank you. I would like to now turn the conference over to Mike Hencke, Investor Relations. Mr. Hencke, you may begin.

Good morning and welcome to Biogen's third quarter 2021 earnings call. Before we begin, I encourage everyone to go to the Investors section of biogen.com to find the earnings release and related financial tables, including our GAAP financial measures and a reconciliation of the GAAP to non-GAAP financial measures that we will discuss today. Our GAAP financials are provided in Tables 1 and 2 and Table 4 includes the reconciliation of our GAAP to non-GAAP financial results. We believe non-GAAP financial results better represent the ongoing economics of our business and reflect how we manage the business internally. We have also posted slides on our website that follow the discussions related to this call. I would like to point out that we will be making forward-looking statements, which are based on our current expectations and beliefs. These statements are subject to certain risks and uncertainties and our actual results may differ materially. I encourage you to consult the risk factors discussed in our SEC filings for additional detail. Today, we will be discussing ADUHELM. ADUHELM is indicated for the treatment of Alzheimer's disease. Treatment with ADUHELM should be initiated in patients with mild cognitive impairment or mild dementia stage of disease, the population in which treatment was initiated in clinical trials. There are no safety or effectiveness data on initiating treatment at earlier or later stages of the disease than were studied. This indication is approved under accelerated approval based on reduction in amyloid beta plaques observed in patients treated with ADUHELM. Continued approval for this indication may be contingent upon verification of clinical benefit in a confirmatory trial or trials. ADUHELM can cause serious side effects, including amyloid-related imaging abnormalities or ARIA. ARIA is a common side effect that does not usually cause any symptoms, but can be serious. ADUHELM can cause serious allergic reactions. The most common side effects include ARIA, headache, and fall. Please see full prescribing information and patient medication guide at aduhelm.com. On today's call, I am joined by our Chief Executive Officer, Michel Vounatsos, Dr. Al Sandrock, Head of Research & Development, and our CFO, Mike McDonnell. We will also be joined for the Q&A portion of our call by Alisha Alaimo, President of our U.S. organization, and Toby Ferguson, Head of Neuromuscular Development. As a reminder, during the Q&A portion of the call, we kindly ask that you limit yourself to one question. I will now turn the call over to Michel.

Good morning, everyone. And thank you for joining us. We continue to view 2021 as a transformational year for our Company. We are satisfied with our 2021 pipeline accomplishments and the continued operational performance of the Company. However, we are obviously disappointed that uptake of ADUHELM in the U.S. has been delayed. We had solid financial results for the third quarter with total revenue of $2.8 billion and non-GAAP EPS of $4.77. Biogen has continued to execute well and demonstrate resilience across MS, SMA, and biosimilars despite competition. Mike will provide more details on our financial results and I will focus primarily on ADUHELM. We continue to believe in ADUHELM's long-term potential and this quarter we continued to progress the launch in the U.S. in anticipation of the reimbursement decision for Medicare patients. We are working through the three near-term challenges we have previously described with a core focus on enabling patient access. Importantly, we have made steady progress on key metrics, but the healthcare system remains a major bottleneck. In particular, the lack of clarity on reimbursement has delayed patient access to the first treatment to address an underlying pathology of Alzheimer's disease, which is reasonably likely to predict clinical benefit. We look forward to the upcoming Medicare national coverage determination expected by next April, which would clarify Medicare reimbursement for the entire class of antibodies directed against amyloid. The NCD is a rigorous process involving a number of consultations. We understand this is required for this new class of drugs for Alzheimer's. However, keep in mind this will delay access for many patients by approximately 300 days from approval. Biogen is acting with urgency across the three strategic priorities as we work to support access for patients. First, we are working to improve the community's understanding of our clinical data. As a reminder, the Phase 3 EMERGE study met its pre-specified primary and secondary endpoints, showing a significant reduction in clinical decline. Patients who receive high-dose ADUHELM experience significant benefits on measures of cognition and function, including activities of daily living. Although the other Phase 3 study, ENGAGE, did not meet its primary endpoint, analyses for both studies demonstrated that higher exposure to ADUHELM was associated with greater reduction in clinical decline. We have submitted these Phase III results to a top-tier journal with the manuscript now under peer review, in addition to preparation for publication of our data. We will continue to generate additional data. We launched ICARE-AD, the first real-world observational Phase IV study in Alzheimer's disease designed to evaluate the safety and effectiveness of ADUHELM in clinical practice. We have submitted a draft protocol to the FDA for the required Phase IV confirmatory study. We have fully resourced this study with the goal of completing it ahead of schedule. In addition to presenting ADUHELM data at scientific meetings, the EMBARK baseline data have been accepted for presentation at next month's CTAD meeting, which will provide important information regarding the impact of ADUHELM in treatments. Furthermore, we also plan to present important new plasma phosphorylated tau data from EMERGE and ENGAGE that highlight the downstream effect of aducanumab as soon as possible. Overall, the approval of ADUHELM was supported by a significant dataset from eight studies, with more than 3,000 patients. We look forward to continuing to generate additional data to support the clinical profile of ADUHELM. Our second priority is to rapidly develop the necessary infrastructure. At launch, we established partnerships with LabCorp and Mayo Clinic Laboratories for amyloid beta CSF testing. Throughout the quarter, we saw a continuous increase in the number of patients utilizing this hub. We also continue to advocate for reimbursement of amyloid PET imaging. Furthermore, we are continuing to see additional sites come online with approximately 120 sites now treating patients with ADUHELM and many more sites in progress. And third, to clarify reimbursement: as we wait for the NCD decision for this class of antibodies, we have obtained an ADUHELM J-code becoming active in January of next year and hope this will help simplify the coding process for healthcare providers. Looking forward, in addition to presenting and publishing the data that I previously mentioned, the most significant near-term milestones will be the outcome of the NCD for antibodies directed against amyloid. We expect a draft decision in January followed by a final decision in April of 2022. In Alzheimer's more broadly, our partner Eisai recently initiated the FDA rolling submission for lecanemab BLA under the accelerated approval pathway following the receipt of breakthrough therapy designation. With the approval of anti-amyloid antibodies that are either approved or in late-stage development, Biogen and Eisai have the opportunity to provide patients with two out of the four potential options. With the first FDA-approved therapy to address an underlying pathology of Alzheimer's disease, the potential to bring lecanemab and our promising pipeline programs such as BIIB080, and with the benefit of digital technologies, we believe Biogen is well-positioned to remain a long-term leader in Alzheimer's disease. Moving beyond Alzheimer's disease, together with our partners at Sage, we continue to make progress towards bringing potential novel therapeutic options to patients suffering from depression. We recently obtained positive data from a Phase 2 study in Japan representing the third positive placebo-controlled study for zuranolone in MDD. In addition, we announced our plans to initiate a filing in the U.S. Lastly, we recently reported data from the VELOCE Phase III study of tofersen in ALS. Although the VELOCE study did not meet the primary endpoint, signs of reduced disease progression across multiple endpoints were observed. We are encouraged by this study of evidence and are engaging with regulators on next steps. Following discussion with investigators, Biogen, and having listened to the voice of patient advocacy groups, we intend to expand the early access program to the broader population of individuals living with SOD1 ALS. We believe these recent developments represent a significant step forward in our goal of transforming Biogen from a multiple sclerosis-focused company to one that is built upon a multi-franchise portfolio across a broad spectrum of neuroscience areas. I would now like to turn the call over to Al for a more detailed update on our progress in R&D.

Thank you, Michel, and good morning, everyone. As always, I'd like to start by thanking the Biogen team for their hard work as we continue to advance our R&D programs. In addition to key readouts in major depressive disorder and ALS, we hosted an R&D Investor Day to tell you about our pipeline programs, research capabilities, and expertise. I encourage you to take a look at these presentations on our website. Let me now start with Alzheimer's disease, beginning with aducanumab. At the R&D Day presentation earlier this month, I underscored the importance of determining the relationship between drug to biology, as well as biology to disease during the drug development process. In late June, FDA made data from the drug approval package of ADUHELM publicly available. The clinical pharmacology review included in the approval package addresses some of these key relationships. This first figure shows the relationship between the amyloid plaque burden as measured by the observed SUVR score versus drug exposure as measured by the predicted cumulative AUC, both at week 78, taking into account all of the data from both Phase 3 trials of aducanumab. The relationship between exposure to aducanumab and amyloid plaque reduction is consistent across the two studies and shows that amyloid plaque burden decreases as cumulative drug exposure increases. The next figure from the same document plots the relationship between the reduction in amyloid plaque burden as measured by SUVR and the preservation of clinical function as measured by the CDR-Sum of Boxes across multiple dose levels of several anti-beta antibodies. Studies 301 and 302 are referred to as study 2 and study 1, respectively, in the ADUHELM label. When viewed together, these data from six different anti-amyloid antibodies showed that there is an association between amyloid plaque reduction and the reduction in clinical decline, and that greater degrees of amyloid plaque reduction are associated with greater reduction in clinical decline. At the annual AAIC meeting in July, we presented additional data from the EMERGE, ENGAGE, and PRIME trials, which show that aducanumab treatment led to a reduction in amyloid plaques, as well as downstream biomarkers of Alzheimer's disease pathophysiology, and led to a slowing of clinical decline. We're looking forward to presenting more data from our aducanumab trials, including the baseline data from the EMBARK study at the upcoming CTAD meeting next month in Boston. We're also looking forward to presenting at the earliest possible opportunity at a scientific venue new data on plasma p-tau reflecting the downstream biological and clinical effects of aducanumab, which I believe will be of great interest to scientists and clinicians. By way of reminder, amyloid plaques containing A-beta protein and neurofibrillary tangles containing phosphorylated tau are the defining pathophysiologic features of Alzheimer's disease. Finally, I'm happy to say that we are on track to soon publish the Phase III aducanumab trial results in a major peer-reviewed journal. This quarter we also submitted a draft protocol for the required Phase IV confirmatory trial of aducanumab to the FDA. As I have said before, we have fully resourced this study and aim to complete it ahead of schedule. The key goal of the confirmatory study is to ensure that we have enrolled appropriate numbers of Alzheimer's disease patients from underrepresented populations. It is estimated that by 2030, nearly 40% of all Americans living with Alzheimer's disease will be African American or Latinx. Therefore, having sufficient participation of these communities is especially important to reflect the diversity of the disease in the real world. Through the Phase IV confirmatory study, as well as ICARE-AD, we aim to provide further evidence of the clinical benefits and risks associated with aducanumab treatments. Outside of the United States, we're under regulatory review in multiple geographies, including the EU, where we are actively preparing for a scientific advisory group meeting as part of the CHMP review process. Turning to lecanemab, we're looking forward to when we can potentially provide two amyloid antibody options for Alzheimer's disease patients. As previously announced, our collaboration partner Eisai recently initiated a rolling submission of lecanemab data to the FDA for potential accelerated approval. We expect this submission to be complete sometime in 2022. Moving to MS, we presented new data at the annual ECTRIMS meeting last week, including primary results from the NOVA Phase 3b study evaluating the efficacy of TYSABRI extended interval dosing versus the approved every-4-weeks dosing; a real-world claims-based analysis of relapse and hospitalization rates in MS patients treated with natalizumab versus ocrelizumab; a new analysis of the EVOLEDRY MS-2 data focusing on the impact of dose titration on the GI tolerability of VUMERITY relative to TECFIDERA; and data from the MS PATHS showing that 100% of people with MS treated with natalizumab, interferons, or fumarates achieved an antibody response following COVID-19 vaccination as compared to 40% of MS patients treated with anti-CD20 or S1P therapies. With respect to the introduction of VUMERITY in the EU, we were happy to learn of the approval in Switzerland, as well as the positive CHMP opinion, and look forward to the final EMA decision. In neuropsychiatry, we were excited to see the results of the Phase II study of zuranolone in major depressive disorder recently completed by Shionogi. The Phase II trial was similar in design to the other studies evaluating zuranolone in MDD and compared 20 mg and 30 mg doses of zuranolone to placebo in Japanese patients with MDD. The results of this study further support the safety and efficacy profile of zuranolone in that it demonstrated rapid onset and significant reductions in the HAM-D 17 score at Day 3, Day 8, and Day 15. Additionally, while not statistically significant for all comparisons, we saw separation from placebo for both the 20 mg and 30 mg treatment arms. All adverse events in the study were mild to moderate and consistent with the known safety profile of zuranolone. The Shionogi study is now the third double-blind placebo-controlled trial evaluating zuranolone in MDD where the primary endpoint of the change in the HAM-D score at Day 15 was met. These results in MDD are in addition to the efficacy of zuranolone in PPD as observed in the RBX trials. Given the consistent results observed across the zuranolone trials, Biogen and Sage have announced plans to submit an NDA to the FDA in the second half of 2022. The planned initial submission package will be used to seek approval of zuranolone for the treatment of major depressive disorder, and an additional filing for postpartum depression is anticipated in the first half of 2023. Additionally, the CORAL study designed to evaluate zuranolone as an acute rapid-response therapy when co-initiated with standard antidepressant therapy is now fully enrolled with top-line data expected in early 2022. Moving to neuromuscular disorders, this quarter we announced results from the pivotal Phase III study evaluating tofersen in people with SOD1-mediated ALS. The Phase III VALOR study utilized a study design to stratify participants into faster and slower progressing cohorts. We were disappointed when we learned that the study did not meet the primary endpoint of a statistically significant change from baseline to Week 28 in the ALS Functional Rating Scale in the faster progressing population. Nevertheless, we did observe encouraging trends favoring tofersen across multiple secondary and exploratory measures of biological and clinical activity, including assessments of motor function, respiratory function, muscle strength, and quality of life. Moreover, a pre-specified integration of data from the Phase III study and its ongoing open-label extension study reinforced these findings and showed that early tofersen initiation led to a slower decline across these measures. Beyond the clinical measures, we observed reductions in CSF SOD1 as compared to placebo, suggesting target engagement was achieved. Moreover, on the key secondary endpoint of a change in plasma neurofilament light, a potential marker of neuronal degeneration, we observed reductions of 67% in the faster progressing patients, and 40% to 48% in the slower progressing patients with tofersen treatment relative to placebo. To our knowledge, this represents the greatest reductions in plasma neurofilament levels ever observed in an ALS clinical trial. Most adverse events in the Phase III study were mild-to-moderate in severity, and many were consistent with ALS disease progression or lumbar puncture-related events. Serious adverse events, including transverse myelitis, were seen in some patients receiving tofersen. Based on the results of the Phase III study, we are actively engaging regulators, the medical community, patient advocacy groups, and other key stakeholders around the world to determine next steps for tofersen. Additionally, following discussions with key medical experts and emphasis, we plan to provide early access to tofersen to all eligible SOD1 ALS patients through an expanded access program. Given the possible importance of early treatment of SOD1 ALS, we continue to enroll patients in the OLE study, a Phase 3 trial of tofersen initiated in clinically pre-symptomatic SOD1 mutation carriers. Our hope is that treating patients earlier in the disease may provide the best opportunity to slow or even delay the onset of this terrible disease. Also in neuromuscular disorders, this quarter we announced our plans to initiate a Phase 3b study, which aims to evaluate whether treatment with an investigational higher dose of nusinersen has the potential to improve clinical outcomes in patients previously treated with risdiplam. Our SPINRAZA data indicate that exposure remains similar as patients age and grow. We're also advancing the ongoing DEVOTE study, evaluating the safety and efficacy of higher exposures of SPINRAZA, as our pre-clinical studies indicate that we ought to be able to safely increase its dose. With the DEVOTE and ASCEND studies we hope to further inform SMA treatment and address the remaining unmet needs of patients. In summary, as I described during our recent R&D Investor Day, we believe the science is advancing and that this is exactly the right time to be pioneers in neuroscience. By leveraging a deep understanding of human genetics and disease biology, we are working to usher in the future of neurotherapeutics, where we identify the right patients and treat early, perhaps even before the onset of symptoms, to meaningfully delay or even prevent disease progression. I will now turn the call over to Mike.

Thank you, Al. We're very pleased with our third quarter results as we continue to execute well. As we move forward, we remain fully focused on our core business, including the launch of ADUHELM in the United States. Total revenue for the third quarter of $2.8 billion declined 18% versus the prior year at both actual and constant currency and reflects the impact of TECFIDERA generics. Total MS revenue for the third quarter was $1.8 billion inclusive of Ocrevus royalties. Looking at some of the individual products within MS globally: TECFIDERA revenue for the third quarter was $499 million. In the U.S., third quarter revenue of $179 million was flat versus the prior quarter with lower volume offset by a decrease in discounts and allowances. We expect TECFIDERA revenue in the U.S. to decline going forward. Outside of the U.S., third quarter TECFIDERA revenue of $319 million increased by 13% versus the prior year with 7% underlying patient growth. We were pleased with the continued ramp in VUMERITY revenue from $91 million in the second quarter to $121 million in the third quarter. We are also pleased that VUMERITY received a positive CHMP opinion in the EU, as well as full regulatory approval in Switzerland. TYSABRI third quarter global revenue of $523 million increased 1% versus the prior year, notwithstanding some negative channel dynamics in the United States. We were pleased to see 7% growth in global TYSABRI patients. We believe TYSABRI remains well-positioned to play an increasingly important role in the treatment of MS with initiatives including subcutaneous administration and extended interval dosing. We are also encouraged by the new data on COVID vaccinations that Al mentioned. Moving to SMA, global third quarter SPINRAZA revenue of $444 million decreased by 10% versus the prior year. In the U.S., SPINRAZA revenue of $140 million decreased by 23% versus the prior year as we see continued impact from competition. However, we were encouraged to see that this decline decreased versus the second quarter of this year. Outside the U.S., SPINRAZA revenue decreased 2% versus the prior year due to competition and pricing pressure in Europe, partially offset by growth in regions outside of Europe. As a reminder, Q1 and Q2 2021 SPINRAZA revenue outside the U.S. benefited from accelerated shipments. Total ADUHELM revenue for the third quarter was $300,000 as we saw wholesalers gradually draw down inventory purchased in Q2 for the three main reasons Michel discussed: uptake has been delayed, reimbursement uncertainty, and operational bottlenecks. I would refer you to the slide as well as slides in the appendix for details on the accounting with Eisai and Neurimmune, which differs depending on geography. Moving on to our biosimilars business, third quarter revenue of $203 million decreased by 2% versus the prior year as we continued to be negatively impacted by pricing pressure as well as the COVID-19 pandemic. We're excited that BIoviz was approved in the U.S., EU, and UK, and believe that we have the opportunity to continue to grow our biosimilars business by commercializing new products and entering new geographies such as the U.S. Total anti-CD20 revenue in the third quarter of $415 million decreased 26% versus the prior year. This decline was primarily driven by the decline in RITUXAN revenue, as we see continued impact from biosimilars, a trend that we expect going forward. Total other revenue in the third quarter of $158 million increased 26% versus the prior year. Other revenue in the quarter benefited from the timing of shipments related to contract manufacturing. Third quarter gross margin was 82% of revenue, down slightly from 83% in the prior quarter, and down from 87% in Q3 of 2020. The reduction in gross margin versus the prior year was primarily due to declines in TECFIDERA and RITUXAN, both of which are high-margin products. We expect continued downward pressure on gross margins going forward. Moving now to expenses and the balance sheet: third quarter non-GAAP R&D expense was $702 million, which included a $125 million upfront payment related to our collaboration with InnoCare. Non-GAAP SG&A was $651 million, including approximately $135 million related to ADUHELM. Note that beginning in the second quarter, Eisai's reimbursement of U.S. SG&A costs is reflected in the collaboration profit sharing line. Third quarter collaboration profit sharing was a net expense of $21 million, which includes the reimbursement of $51 million from Eisai related to the commercialization of ADUHELM in the U.S. Our effective non-GAAP tax rate for the quarter was approximately 14% versus approximately 19% in the third quarter of last year. Third quarter non-GAAP loss attributable to non-controlling interest was $11 million. As a reminder, ADUHELM royalties and commercial launch milestones paid to Neurimmune will be reflected in this line. Eisai's reimbursement for these items will be reflected in collaboration profit sharing. During the quarter, we repurchased 2.2 million shares of the Company's common stock for $750 million. As of September 30, 2021, there was $2.8 billion remaining under the share repurchase program authorized in October of 2020. Our weighted average diluted share count was approximately 149 million shares for the quarter. Non-GAAP diluted earnings per share in the third quarter was $4.77. In the third quarter, we generated approximately $805 million in cash flow from operations. CapEx was $42 million and free cash flow was approximately $763 million. We ended the quarter with $7.3 billion in debt, $3.9 billion in cash and marketable securities, and $3.3 billion in net debt. In addition, our $1 billion revolving credit facility was undrawn as of the end of Q3. Overall, we remain in a very strong financial position with significant cash and financial capacity to grow the business over the long term. Let me now turn to our updated full-year guidance for 2021. We are increasing our full-year 2021 revenue guidance from our previous range of $10.65 billion to $10.85 billion to a new range of $10.8 billion to $10.9 billion primarily as a result of stronger MS performance. We are increasing our non-GAAP diluted EPS guidance from our previous range of $17.50 to $19.00 to a new range of $18.85 to $19.35 primarily driven by the revenue upside I just mentioned. We are lowering our capital expenditure guidance from a previous range of $375 million to $425 million to a new range of $250 million to $300 million primarily as a result of delayed spend on certain projects, including some which have been impacted by COVID-19. Our guidance assumes minimal ADUHELM revenue in 2021. We continue to expect revenue to start ramping in 2022 and beyond, particularly after the NCD decision in April, assuming a positive outcome. We expect continued declines in both TECFIDERA and RITUXAN in the U.S. and that the decreased revenue from these high-margin products will put pressure on our gross margin percentage. Full-year non-GAAP R&D expenses are expected to be between $2.45 billion and $2.55 billion; this range is consistent with our previous guidance. Full-year non-GAAP SG&A expenses are expected to be between $2.6 billion and $2.7 billion. This range is consistent with our previous guidance and includes an approximate $500 million ADUHELM investment. Of this amount, approximately $150 million would be reimbursable by Eisai as reflected as collaboration profit sharing effective April 1st and not part of SG&A. This ADUHELM investment is slightly less than our previous estimates. We will continue to actively manage the pace of this spend. This annual SG&A range also assumes seasonally higher spending in Q4, consistent with previous years. I would refer you to our press release for other important guidance assumptions. In closing, we're very pleased with our financial performance and are very focused on the ADUHELM launch. We remain in a very strong financial position with significant cash, modest leverage, and a business that generates significant free cash flow. We believe these dynamics position us well to continue to grow the business over the long term. I will now turn the call back over to Michel for his closing comments.

Thank you, Mike. Biogen continues to demonstrate resilience and strong execution in the third quarter of the year, providing a solid foundation for the Company as we make progress on the ADUHELM launch ahead of the important data releases and publications in addition to the NCD decision for the class of anti-amyloid antibodies anticipated next April. We believe ADUHELM represents a significant step in the fight against Alzheimer's disease, as the first FDA-approved treatment to address a defined pathology of the disease, which is reasonably likely to predict clinical benefit. We know that patients are suffering right now from the disease, and it is those patients we keep in mind as we work to support access. In fact, at the CTAD meeting next month, we'll be presenting an analysis showing that without access, every day that passes we estimate that over a thousand Americans move from mild to moderate Alzheimer's dementia, and therefore may no longer be appropriate for initiation of treatment with ADUHELM. As many have observed, our current system so far falls short in diagnosing and intervening in the disease. In addition, Alzheimer's disease is a particularly acute issue of inequality as African Americans are up to three times more likely and Latinx individuals are 1.5 times more likely to have Alzheimer's disease when compared to others. We understand the seriousness of the issue and that inclusion of underrepresented populations in drug development is often low, including in our Alzheimer's clinical trial. We also know that we have work to do and a role to play in correcting this. For that reason the design of ICARE-AD, our real-world Phase IV observational study of ADUHELM, aims to include at least 16% of the trial's expected enrollment from Black, African American, and Latinx patients. In closing, I would like to thank our employees around the world who have demonstrated a dedication to making a positive impact on patients' lives and all of the physicians, caregivers, and participants in our clinical development programs. Our ability to deliver medicines to patients could not be realized without the passion and commitment. We will now open the call for questions.

As a reminder, please limit yourself to one question. Your first question comes from the line of Robyn Karnauskas.

Thanks for taking my question. I think a lot of us have struggled with some of the headlines coming from doctors about how they do not want to give the drug. I understand that you are highlighting the NCD decision as the core reason for a lack of reimbursement. Can you talk a little bit about how you are going to convince doctors even if you have a positive NCD decision to give the drug to patients? Is the negative commentary in the headlines driving this reluctance? Is that a core block for uptake of the drug?

Absolutely. The first priority that we have is to educate the community based on the current data and additional data that we're going to communicate and publish in the near future. They also expect to see a full publication in a peer-reviewed journal. These concerns are interrelated with the uncertainty about reimbursement. I will ask Alisha to say a bit more.

Thank you, Michel, and thank you, Robyn, for the question. This is actually not an exact science and what we're hearing is that the majority of prescribers actually fall into a combination of two categories. The first is around the benefit-risk profile, which of course you are reading about and the question refers to. The second is hesitancy due to the NCD analysis. However, there is a meaningful portion of prescribers that are still undecided. So those are some of the headlines. We do have a very large bucket that haven't made a decision one way or another. This is why we have multiple teams working every single day and working very hard to help educate sites and HCPs on our clinical data and on the reimbursement pathways, which are very complex. Michel referenced this in his opening statements. We're working with urgency because the cost of doing nothing is also well understood. Michel mentioned that we estimate that a thousand patients a day advance in their Alzheimer's journey from mild to moderate AD, and therefore may no longer be appropriate for ADUHELM. We are really committed to being a part of the solution, and that's what motivates us each and every day. As soon as we get more data, we will be sure to share it because we understand where the question is coming from. So thank you.

We believe evidence not only coming from aducanumab but also potentially from all the anti-amyloid products will represent a significant body of evidence for those who are skeptical about amyloid. We are also very encouraged by the data on ADUHELM. We continue to invest strongly behind our data. More to come.

We'll take our question from the line of Michael Yee with Jefferies.

Good morning and thank you for the update. Appreciating that you commented that the NCD, of course, is an important milestone, can you comment around your view on what the scenarios would be and what you believe a positive NCD outcome is, and how important PET reimbursement would be as a part of that positive outcome? Thank you.

Thank you, Michael. We are advocating for PET reimbursement and Alisha will provide more color on the options.

Thank you, Michel and thank you Michael for your question. It's important to remember that the NCD is not only for ADUHELM; it's going to be for the entire class of monoclonal antibodies that target amyloid for the treatment of Alzheimer's disease. We can't speculate on the outcome of the NCD analysis. We do believe it will be a major milestone and will alleviate a lot of the confusion that we're seeing with physicians. There are five potential outcomes and the three that people most talk about are: one, a new coverage decision; two, coverage with evidence development (CED); and three, coverage with restrictions. If you look at history over the last 20 years, there were 12 NCD processes: one was a non-coverage, one was an off-label CED, and the other ten were basically covered indications. So even though we can't comment on the outcome, we are in this rigorous process and are replying to them anytime that they need additional data. Remember that all manufacturers are in this process together.

Next question.

Your next question comes from the line of Cory Kasimov with JPMorgan.

Hey. Good morning, guys. Thank you for taking my question. I know we're all waiting for the NCD. At this stage of the launch, is there any consideration being given to changing the gross price of ADUHELM given how difficult initial traction has been, or do you think that's not a key impediment in all of this?

I think that the NCD is critical, and data dissemination is even more critical; the two are interrelated. When we look at the metrics and market research, price doesn't come up as the first worry. We have a strong rationale. We disagree with the underlying assumptions of some assessments about long-term efficacy. We always have the opportunity to fine-tune pricing and keep that as an option, but first is data, which is interrelated with the decision for the NCD, and infrastructure is also progressing. Alisha, do you want to comment on the issue of price?

Thank you, Michel. Cory, price is always an important factor for sites and for patients, but what I can share is that we have not heard that price is the primary driver for decisions not to treat patients. The headwinds we're facing are the ones Michel mentioned and that you read in the press. As with other therapies, if patients think they might face difficulty affording ADUHELM, we do have financial assistance programs that are available to help these patients. If reimbursement or affordability is a concern, we hope our programs can provide a potential pathway because we do believe lack of financial means should not be a barrier for patients to access ADUHELM.

Importantly, at launch we offered innovative contracting and pricing options on a voluntary basis to support sustainability. The offer remains available and decision-makers and health systems are aware, but we are respecting the NCD process. Next question.

Your next question comes from the line of Marc Goodman with SVB Leerink.

Good morning. My question is on zuranolone. Moving forward with this product, a two-week treatment course implies a pretty significant cost per treatment. This would be an all-in strategy on a paradigm shift in depression treatment, which seems risky. I'm curious about the market research you've done and conversations with psychiatrists to know they have buy-in and that this will be successful. The product works quickly, which is important, but the two-week treatment course would be very different. Thanks.

What is important is that eventually we will be in a position to transform the management of major depressive disorder and postpartum depression. For the time being, we're driven by science, readouts, and the data that we get. We haven't had detailed public discussion on price yet while the team is building market research and evidence to be ready should the data confirm. We are pleased with the three placebo-controlled results pointing in the same direction.

Thanks, Marc. It is a paradigm shift in thinking for psychiatrists, so there will be a lot of education necessary assuming we do get approval. The current standard of care uses SSRIs or SNRIs which take weeks, if not longer, for patients to respond and many patients stay on them chronically, often with side effects. A two-week treatment course where clinicians can give the drug as needed is a very different way of thinking and could be attractive. The rapid onset—seeing efficacy in a few days—allows physicians to be reassured and consider the two-week course followed by as-needed treatments. It is a different approach, but I think it's very exciting.

Next question.

Your next question comes from the line of Matthew Harrison with Morgan Stanley.

Good morning. Thanks for taking my question. Al, could you comment and just remind us around the differences in the BAN2401 (lecanemab) Phase III study versus the aducanumab studies? How important do you think a successful Phase III study is for BAN2401 next year, especially in terms of changing physician perception around aducanumab and anti-amyloid drugs?

I think it's very important, Matthew, because doctors are uncertain about the benefit-risk profile. As Michel said, the data that comes not only from aducanumab but from all of these anti-Aβ antibodies that can substantially reduce amyloid burden will be important. There are more similarities than differences between aducanumab and lecanemab: both bind aggregated forms of Aβ and both reduce amyloid plaque burden substantially. Differences include that lecanemab may not require the same titration scheme and current evidence suggests ARIA rates with lecanemab may be lower than those seen with aducanumab, although we'll learn more from Phase III. The Phase III design is similar to aducanumab's Phase III trials in that the primary endpoint is the CDR-Sum of Boxes, an established clinical efficacy measure for Alzheimer's disease.

Thank you. The design of the Phase 3 trial for lecanemab is similar to aducanumab. The primary endpoint for both is CDR-Sum of Boxes.

Next question.

Your next question comes from the line of Geoff Meacham with Bank of America.

Morning, guys. Thanks for taking the question. Prior to approval, you talked about expansion of manufacturing capacity and investing heavily in the commercial aspect for the launch. Has the strategy changed given the pace of the rollout? Are you in a holding pattern before the April NCD or will you remain aggressive on investments for the ADUHELM launch?

We are staying the course as a Company. It feels like an extended pre-launch period. We are staging the spend very closely. Mike, the team and I are scrutinizing investment requests from around the world. We want to be extremely vigilant, but we stay the course because we believe in our data and in the additional data coming. Infrastructure is progressing and we are making steady progress.

Jeff, it's a great question. I would describe our approach as a gating process. We continue to believe in the long-term potential of ADUHELM, and at the same time because of the delays we're gating the spend. We're still making a meaningful investment—an estimated $500 million of SG&A in 2021 (approximately $350 million net of reimbursement). Some CapEx ties to facilities to support ADUHELM, but most of the reduction in our CapEx guidance ties to timing and global supply chain challenges. We'll be prudent and gate the spend, but we will continue to be ready and invest aggressively when appropriate.

This is an extended pre-launch, but we're encouraged by the progress: about 120 centers are treating ADUHELM, which is more than double from months ago. Some large institutions want more data and we'll provide it in a few weeks. The process is taking longer than expected, but we must be resilient.

We'll take our next question from the line of Umer Raffat with Evercore.

Hi guys, thanks for taking my questions. I have two parts. First, streets are carrying around $1 billion in U.S. ADUHELM revenue for 2022, which implies north of ~75,000 new starts next year. That seems high. Since we're trying to level set today, is 25,000 new starts for next year too high an expectation? Second, as we're heading into the lecanemab PDUFA, it feels like there wasn't enough street discourse between management and the street ahead of ADUHELM pricing. Is it reasonable to expect a lecanemab price point more consistent with what the street assumed for Alzheimer's market pricing? Thanks very much.

Umer, I'll take the first part. We're not guiding for 2022 today. We did say we expect minimal revenue for the rest of 2021 and expect revenue to ramp in 2022 post-NCD assuming a positive decision in April. We don't have great visibility to patient counts, which is why we are not providing specific patient guidance publicly. That said, sites are continuing to progress: approximately 120 sites have infused at least one patient, more than double what it was about six weeks ago. We'll continue to monitor these metrics and ramp as quickly as we can. Remember that titration is important—patients will titrate up to higher doses—so the revenue ramp will be gradual. The important takeaway is that over the long term we continue to view ADUHELM as a very meaningful multi-billion opportunity.

Uptake should accelerate once the system has indication of coverage—draft decision in January and final decision in April—but I don't expect uptake to be explosive or linear. It will be non-linear because the patient journey is long. Hundreds of sites are in progress beyond the 120 active sites. We will provide more detail at the appropriate time.

On the lecanemab pricing question, that's something we'll consider at the appropriate time. We don't have additional comment today.

Your next question comes from the line of Ronny Gal with Bernstein.

Good morning. A question about ADUHELM versus lecanemab dynamics. Looking at comparative data, lecanemab appears to have at least the same benefit as aducanumab and may be safer. Given lecanemab's Phase 3 readout expected next year, could lecanemab become the major Alzheimer's product Biogen markets in future years, or do you still expect ADUHELM to be the main growth driver? Can you talk about competitive dynamics?

We are delighted to see lecanemab coming along strong. It reached robust Phase 2 data after aducanumab and is encouraging, but Phase 2 is smaller—Phase 3 will be larger and is needed. We stand by the data for ADUHELM; we know our data and have confidence in the product. With lecanemab, we could eventually have a stronger position, but we need to wait for additional data. We may have more than one product in the market and this competition could enlarge the market.

I agree. Things can look promising after Phase 2 but Phase 3 is larger, involves more sites and countries, and time will tell. We'll learn more with Phase 3 and ultimately from the label.

Next question, please.

Your next question comes from the line of Salim Zad with Mizuho.

Great. Good morning, and thanks for the color and detail. One on ADUHELM: When we look at peak sales estimates around $9 billion, that seems to imply chronic administration. Given potential coverage with evidence, possible restrictions on treatment duration, and that moderate patients may no longer be appropriate for treatment, should people be looking at ADUHELM more as an incidence-based model or with potential duration caps coming out of the NCD?

I don't think people will look solely at incident use as is done for some other diseases. We stand behind the data and believe long-term prospects are significant. Competition could enlarge the market. There is room for multiple players. The U.S. delay is due to system readiness, but we believe the situation will evolve.

In terms of the possibility of stopping treatment after a certain period, data suggest that after amyloid plaque reduction the plaque burden can remain low during a treatment gap. Other biomarkers change slowly during a treatment gap, suggesting ongoing biological effects. So the question of chronically treating versus stopping after some period remains open and will require more study. We look forward to providing more data on this.

We have time for one more question.

Your final question comes from the line of Phil Nadeau with Cowen & Company.

Morning. Thanks for fitting me in. A question on the sites that are activated: you mentioned about 120 sites currently activated. How many do you think you could have activated by the NCD decision in April? Also, could you talk about the challenges in opening those sites? Are the challenges the same as physician reluctance or are there additional issues like logistics around monitoring for ARIA or giving the infusions?

Alisha?

Thank you for the question, Phil. We're at approximately 120 activated sites, meaning at least one patient has been infused. We also have several hundred sites in queue on this journey. Activated sites do not capture all sites that are in multiple activation steps. The operational challenges are the same in many respects and have been significant because these sites have never administered a drug like this for their patients. They need to set up protocols, determine where to do MRIs, where to do lumbar punctures, and where to do infusions. This has taken time—some sites have been working on this since June. Our original strategy focused on sites where the majority of diagnosed patients are seen; we had over 900 sites prepared. We believe once we share additional data and the NCD outcome is finalized, those sites will be prioritized to get patients through the system.

Thank you so much for attending the call today. Biogen delivered a very strong quarter; the base business is solid. We're making progress on ADUHELM despite the short-term challenges we face. The key is the mid-to-longer-term outlook. We have a path forward for zuranolone and we're preparing to launch biosimilars in the U.S. in coming months. Thank you very much for attending the call.

This concludes today's call. Thank you for your participation. You may now disconnect.