Good morning. My name is Melinda, and I'll be your conference operator today. At this time, I'd like to welcome everyone to the Biogen First Quarter 2025 Earnings Call and Business Update. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. Today's conference is being recorded. Thank you. I would now like to turn the conference over to Mr. Tim Power, Head of Investor Relations. Mr. Power, you may begin your conference.

Thanks, Melinda. Good morning, and welcome to Biogen's first quarter 2025 earnings call. During this call, we will make forward-looking statements, which involve risks and uncertainties that may cause actual results to differ materially from our forward-looking statements. We provide a comprehensive list of risk factors in our SEC filings, which I encourage you to review. Our earnings release and other documents related to our results as well as reconciliations between GAAP and non-GAAP results discussed on this call can be found in the Investors section of biogen.com. We've also posted the slides to our website that we'll be using during the call. On today's call, I'll be joined by our President and Chief Executive Officer, Chris Viehbacher; Dr. Priya Singhal, our Head of Development; and Robin Kramer, our Chief Financial Officer. We'll make some opening comments and then we'll move to the Q&A session. And to allow us to get through as many questions as possible, we kindly ask that you limit yourself to one question. I'll now turn the call over to Chris.

Thank you, Tim. Good morning, everybody. Maybe first a warm welcome to Robin. This is your first quarter as CFO of Biogen, Robin. So, we had a very good start to the year, strong quarter. Biogen is really a tale of two companies, in my view. There's one company which has been an MS company, and that portfolio, as you all know, has been gradually declining. But there's a new Biogen emerging. And when I look at the rare disease business, ZURZUVAE and LEQEMBI, and VUMERITY, we actually have a commercial portfolio that we're actively promoting that's now accounted for about 45% of our product revenue. And those products mostly have a very long runway to continue to grow. And so, we've been talking about it for a few years, but I think now this is actually starting to become visible. We're rolling these products out worldwide. We had the approval of LEQEMBI in Europe, for example, which is a very important approval for us. But we've also seen the approval of SKYCLARYS in the UK and Brazil. Of course, the next lever of growth is going to be our pipeline. And there we're very happy to get the FDA Fast Track designation for our ASO targeting BIIB080. That's remarkable since we haven't actually even read out Phase 2 yet. And I think it's a sign of confidence in the importance of this potential new medicine in the treatment of Alzheimer's. And of course, we've initiated the Phase 3 TRANSCEND study for felzartamab in AMR. And of course, we've always said we've got a very strong balance sheet. We're going to continue to patiently and in a disciplined way augment the pipeline through external innovation. And we're very happy about the partnership that we've built with Stoke on zorevunersen in Dravet syndrome. That’s going to be an important medicine for us. Now, if we turn to where we are with these new product launches. So, LEQEMBI, I mean look at that, $96 million, that's almost $100 million. Now, we're into serious product territory. We have, as I said, obtained the marketing authorization in the EU. And it's important not just because of the market potential in the EU, but now we can say that this is a drug that has been recognized for its importance, its efficacy, and its safety profile by all major regulators in the world. And that's an important sign of confidence. This is again the first disease-modifying agent that has ever been approved in Alzheimer’s. This is a brand new territory. And I think having that kind of regulatory endorsement is extremely important. Now, as we all know, this has been a challenging product to launch, given the workload that this applies to the treating physician. And we're looking forward to a number of the innovations that are coming along that we think can actually reduce that workload. First, of course, is one we have in the bag in the first quarter, which was the approval for the IV maintenance, which will allow us to reduce the dosing for patients after 18 months of treatment to once per month. Then, we're going to make that even easier for physicians with hopefully an approval in August for the subcutaneous formulation, and that offers the potential of at-home administration with an auto-injector. And, of course, in the first half of next year, we're looking forward to the approval, hopefully again, of the subcutaneous formulation for initiation, which will dramatically reduce the need for infusion bed capacity. In addition, of course, this isn't related to Eisai or Biogen, these are independent companies, but there are companies who are pursuing approval for blood-based biomarker tests. And hopefully at some point, we'll be able to see those blood-based biomarkers supplant the need for PET scans and/or lumbar punctures. So, there's an awful lot of catalysts coming for LEQEMBI, but we're very much encouraged now that we've got critical mass behind this. We've also launched a new approach to commercialization from April 1. We and our partners Eisai have spent a lot of time going back through the data, thinking about the lessons learned and have adapted our commercial approach. One of the things, for instance, that we will be doing this year is starting direct patient engagement in Alzheimer's. Now, switching to ZURZUVAE, this is a product that continues to do nicely with Q1 sales of $28 million. Since launch, we have now been able to treat 10,000 women with PPD, and the majority of those prescriptions are actually first-line therapy for postpartum depression. A lesson that we learned along the way was that the physician who is the most important in treating postpartum depression is actually not the psychiatrist, but the OB-GYN. So, 80% of our scripts in Q1, for instance, were from OB-GYNs. One of the most important things here is that you're talking about a one-and-done treatment essentially. And so, to make this commercially viable, you actually need to have writers expand, and we did see that. We were able to expand the number of physicians writing this by 20% in Q1. More importantly, it's getting physicians to write repeat prescriptions. One of the most encouraging things is that we're not only seeing the repeat prescriptions, but I think as physicians gain the experience with ZURZUVAE, they're also gaining the confidence to actually go and be more proactive about diagnosing postpartum depression. I think we're actually seeing a virtuous cycle where this positive response from patients encourages greater attention to a disease that has unfortunately been sadly neglected for so many women. So, very good progress on ZURZUVAE. We've completed our own field expansion at Biogen, and that's been in place since the middle of the quarter. Now, if I turn to SKYCLARYS, we had worldwide sales of $124 million; that's up 59% year-over-year and 21% quarter-on-quarter. We did have some effect from the IRA. You all know about the Medicare tax that has been put in place, and that had an effect. Actually, our gross sales in the U.S. rose faster than our net sales in this quarter. One of the things about this disease, of course, is that this is of European origin as a genetic disease. And essentially where you find the patients is where all the European explorers went in the world. But logically, the biggest number of patients is in Europe. We have had an awful lot of success in finding patients. It’s actually, I think, easier to find them in Europe because they tend to be in centers, whereas they tend to be all over the country in the U.S. But even in the U.S., our U.S. team has been very creative in thinking about new tools to identify where patients are and find them. If I could see the next slide, you can see that we've got a nice steady growth in patient numbers. We've got about 2,400 patients on therapy globally. It's now available in 26 markets. I would caution that not all of those patients yet are paying patients. We have had an approach of having early access significantly higher than the average analog rare disease launch and actually in line pretty much with the SPINRAZA launch. I wasn’t here for that, but as we've gone back and looked at it, the SPINRAZA launch was one of the best, if not the best launch of a rare disease product. We're very happy with the progress of SKYCLARYS. Brazil’s approval is a very important market for us. There are a lot of patients in Brazil, again, going back to where Europeans went in the world. I had met with a number of physicians, and I know that this approval will be very welcome to patients there. Moving on to the pipeline, I think we've made a lot of progress here as well. I mean, you've heard me say time and again that I think we had an extremely high-risk pipeline. When I came here, first of all, it was highly concentrated in neuroscience. That's always an issue when you only have one therapeutic area. But neuroscience was also complicated because we don't always understand the underlying disease biology. The slowly progressing nature of those diseases means that you often couldn't do a Phase 2 study. So, you go immediately into a Phase 3 study. You end up doing incredibly expensive proof-of-concept studies as Phase 3. Now, neuroscience is who we are, and we have not wanted to abandon that by any means; there’s huge unmet need. But we felt that we needed to add another pillar to our company's future growth. The logical place to go was immunology. We've been in immunology since the founding of our company, particularly through MS. I quote my good friend and former colleague, Elias Zerhouni, who often said that we describe too many diseases by their symptoms and not by their cause. When you get into immunology, what's important are the immune pathways. That can lead you into a whole number of different indications, and that is something that Biogen understands very well. You can see on the left chart that we’ve been balancing this now. We have a nice balance between neurology, which has been the pride and home of Biogen for many years, and immunology, where I think we have a very strong right to play. If you look at the right chart, regarding immunology, one of the things you can do is do a proof of concept. Felzartamab is probably the best example of that. That is an ideal product where we've been able to get a very strong proof of concept. There is never a guarantee in any clinical trial, as all of you know. But as we look at the Phase 3 clinical trials for felzartamab, we feel a whole lot more confident about that than some of the other trials where we haven't had that. Looking at our pipeline, I would point out that we have five Phase 3 studies that are initiating this year. That's important from various points of view. First, obviously, there’s a huge potential behind all of those products, and we’re getting into late-stage development. It’s a sign of maturation of our pipeline. The second thing is, we're also increasing the number of shots on goal. We're not dependent on one or two projects. We're going to continue to build on that. The third point I would call out is that we have a number of data readouts coming. As we move into Phase 3, we'll have important readouts already in 2026. That's a nice cadence that will help underpin the continued emergence of this new Biogen. So, I think we’re making very good progress, and Priya is going to talk more about that. The last topic I would cover is one that I think is on everybody's mind, which is tariffs. It's a new topic for us all. In my 35 years in this industry, I've never had to spend as much time as we as a team have on tariffs in the first quarter. This is a very complicated area, and I know for investors, this is very complicated. I wanted to point out a number of features of Biogen, which I think differentiate us from some of our colleague companies in the industry. A number of you have been using the tax rate as a surrogate for what the tariff exposure might be, and I would submit to you that that's actually not appropriate in the case of Biogen. First, when you look at our product sales, 75% of our 2024 U.S. product revenue was attributable to products that already have manufacturing operations in the U.S. In fact, Biogen actually exports more than we import. Therefore, we also pay taxes in the U.S. at federal and state rates. Another structural difference is that approximately 55% of our 2024 product revenue came from countries outside the U.S. That’s unusual in our business. In most of the industry, 60% to 80% of product revenues come from the U.S. Biogen is much more diversified, which is really a function of the products that we have. As we look out for 2025, there is an exemption in place for the moment, and we know that the whole tariff situation is changing daily and is difficult to predict. But at least we can say that even if we lost the exemption and all of those tariffs announced by the U.S. administration on April 22 were to not only come into being but also apply to pharmaceuticals, this would still not affect our 2025 financial outlook. That’s partly due to the long supply chains we have and also due to our supply chain team's efforts; they built levels of inventory, not just of products but also of different ingredients and materials, because this is a highly complex area. Structurally, we are more of a U.S.-based company and always have been, and we're quite proud of that. With that, I'm going to pass it on to Priya to pick up the story on R&D.

Thank you, Chris. This quarter, we made significant progress advancing and expanding our high-conviction late-stage pipeline. We believe our pipeline will play a critical role as we work to deliver sustainable long-term growth enabled by increased momentum in our data flow. This includes potential key approvals this year and expected registrational data starting next year. This quarter, we delivered key milestones across Alzheimer’s, immunology, and rare diseases. First, as Chris mentioned, our tau-targeting ASO BIIB080 received Fast Track designation from the FDA in Alzheimer's disease in April. Alzheimer's is a complex and fatal disease that we believe will require multiple therapeutic approaches to address its diverse pathologies. BIIB080 is a differentiated approach to targeting tau, and the Fast Track designation was based on encouraging Phase 1b data, which showed dose-dependent CSF tau reductions, decreases in tau PET signal, and favorable trends on exploratory cognitive and functional measures. In immunology, we initiated the TRANSCEND Phase 3 study of felzartamab in AMR. This is the first of three Phase 3 studies that we expect to initiate this year for felzartamab, with additional studies in IgAN and PMN anticipated by midyear. Importantly, we expanded our late-stage rare disease pipeline, acquiring rights to zorevunersen in Dravet syndrome in all territories outside the United States, Canada, and Mexico. Dravet syndrome is a developmental and epileptic encephalopathy characterized by severe recurrent seizures and significant cognitive and behavioral impairments. More than 90% of patients continue to experience seizures despite treatment with the best available anti-seizure medicines, and there are currently no medications approved that meaningfully address the underlying cognitive and behavioral aspects of the disease. Zorevunersen is an investigational ASO that is designed to potentially treat the underlying cause of Dravet syndrome for the first time by increasing the Nav1.1 protein production in brain cells. We're encouraged by the Phase 1/2a data we've seen, specifically in respect to cognition and behavior, as well as seizures. Looking at the right-hand side of the slide, scores on the Vineland-3 show that zorevunersen resulted in substantial improvements across multiple measures of cognition and behavior. This was initially observed in the Phase 1/2a study with continued improvement in the open-label extensions out to two years. We believe these results support the potential for zorevunersen to be the first disease-modifying therapy in Dravet syndrome. We look forward to working with Stoke on advancing the Phase 3 EMPEROR study, which we expect to initiate in the next few months. We continue to remain focused on advancing the standard of care in Alzheimer's, and I believe we've made significant progress. Starting with LEQEMBI, we are really excited about the recent approval in Europe. We're also continuing to advance the subcutaneous formulation for both treatment maintenance and initiation to further aid patient optionality and convenience. Furthermore, we believe that the strength of the LEQEMBI real-world data continues to support the urgency to treat symptomatic early AD patients today. We believe it is important that we continue to execute on the opportunity in presymptomatic AD. Clarity AD established that removing plaque in a symptomatic early AD population leads to clinical benefits, and that symptomatic patients with low or no tau can potentially achieve an even greater benefit. We believe AHEAD 3-45 is the right study design to evaluate the potential benefit of LEQEMBI in a true presymptomatic population. Beyond LEQEMBI, we continue to target Alzheimer’s disease biology with potential next-wave therapies, including BIIB080 and novel delivery technologies. Overall, I'm encouraged by the progress we're making in Alzheimer's and believe we are well-positioned to lead the evolution of the treatment landscape. Turning to the pre-proof-of-concept pipeline, I'm excited again about the progress we've made in rebuilding this area. We are applying a strong scientific rationale as we invest in these programs using a disciplined, data-driven decision-making approach to build out a sustainable pipeline with a promising pre-POC pipeline. During this quarter, we made significant progress in this area, including completing enrollment in the Phase 2 study for our LRRK2 inhibitor for idiopathic Parkinson's disease with Denali. Applying our approach to follow the science, these Phase 2 data, which are expected next year, will provide clarity on the potential path forward to Phase 3. We will continue to maintain this approach as we work to grow the pipeline by introducing more assets into early-stage development, both from our organization as well as external innovation sources. With that, I would now like to hand the call over to Robin for a financial update.

Thank you, Priya. I'm pleased to be participating in my first earnings call since stepping into the CFO role. I'd like to begin by extending my gratitude to those in the investment community with whom I've had the pleasure of speaking in my first few months as CFO, and I'm looking forward to spending time with many more of you in the near future. To start, I would like to provide a few highlights on our first quarter financial results. Please note, the comparisons I'm about to make are against the first quarter of 2024, unless otherwise noted. Total revenue for the first quarter of $2.4 billion was up 6% year-over-year, aided in part by the timing of SPINRAZA and corporate partner revenue shipments. Our four launch products delivered approximately $200 million of revenue in the first quarter, an increase of 22% quarter-over-quarter and more than doubling year-over-year. First quarter non-GAAP diluted EPS was $3.02, which was down 18%. This includes the $165 million upfront paid in connection with the Stoke transaction, which impacted EPS by approximately $0.95 in the quarter. Absent that charge, first quarter non-GAAP diluted EPS would have been $3.97, up 8% year-over-year. In the first quarter, we generated $222 million of free cash flow, which includes the $165 million upfront paid to Stoke. We ended the quarter with $2.6 billion of cash. Shortly, I will provide an update on our full year guidance. Now, I'll turn to a few comments on revenue and commercial dynamics in the first quarter. Starting with our MS franchise, our global product revenue declined 11% year-over-year, driven primarily by competition. This included impacts from a biosimilar for TYSABRI in Europe and generic competition for TECFIDERA globally. We have started to see generics launch in certain countries in Europe, such as France and the Netherlands. While we will continue to vigorously defend our IP, we do expect to see further impacts from TECFIDERA generics in Europe this year. A bright spot for MS in Q1 was VUMERITY, where we saw an increase in demand and VUMERITY remains the #1 branded oral therapy. For SPINRAZA, we continue to be encouraged by the consistency and demand globally, including growth in the U.S. of 4% year-over-year. In the first quarter, ex-U.S. SPINRAZA revenue benefited from a one-time VAT refund and the timing of shipments in certain markets, which together were a benefit of approximately $26 million versus Q1 of 2024. As I mentioned earlier, our four launch products together delivered $200 million of revenue to Biogen in the first quarter, an increase of 22% quarter-over-quarter and more than doubling year-over-year. We continue to see steady sequential growth of LEQEMBI with first quarter global end market sales booked by Eisai of approximately $96 million, up approximately 11% sequentially from the fourth quarter of 2024. Global SKYCLARYS revenue was $124 million, a sequential increase of 21% versus the fourth quarter of 2024, driven by continued geographic expansion outside the U.S. Revenue for SKYCLARYS in the U.S. was $69 million, impacted by expected Medicare discount dynamics, partially offset by demand growth. Both ZURZUVAE and QALSODY continued to grow sequentially, driven by increases in demand for each product. The increase in corporate partner revenue in the first quarter was driven by the timing of certain batch commitments related to our contract manufacturing business, some of which were associated with batches of LEQEMBI. We continue to believe that corporate partner revenue will be roughly consistent when comparing full year 2025 with full year 2024. Due to planned maintenance activities and the timing of batch releases, we expect minimal corporate partner revenue in Q4. I'll now turn to a few comments regarding expenses. First quarter non-GAAP cost of sales was impacted by increased lower-margin contract manufacturing revenue. Non-GAAP core operating expenses, which include R&D and SG&A expenses, decreased 1% year-over-year as benefits from our R&D prioritization and Fit for Growth initiatives allowed us to absorb incremental spending associated with our advancing and expanding development pipeline, as well as our product launches. Non-GAAP operating income included approximately $201 million of acquired in-process R&D charges, including the $165 million upfront payment made in connection with the Stoke transaction, which had an approximately $0.95 impact to EPS. Excluding the $165 million upfront payment, non-GAAP operating income would have been $748 million, up 7% year-over-year. As a reminder, we and our peers are required to present upfront and milestone charges in GAAP and non-GAAP operating results. Beginning this quarter, we will break out acquired in-process R&D, including upfronts and milestones in a separate line item in our P&L, consistent with many of our peers. We believe this provides better transparency about our core R&D activities and business development activities. We plan to disclose the schedule of expected charges for each quarter ahead of our earnings calls to aid in modeling. Now, I'd like to provide a brief update on our balance sheet. We generated $222 million of free cash flow in the first quarter, taking into account the aforementioned $165 million upfront payment to Stoke. We ended the quarter with $2.6 billion of cash and approximately $3.7 billion of net debt, and believe that our balance sheet remains strong, allowing us to continue to invest in both internal and external growth opportunities. Turning now to guidance, where we are pleased that our expected underlying business outlook for the year has not materially changed. We are updating our full year EPS guidance to reflect the approximately $0.95 impact from the Stoke transaction, along with $0.20 of an earnings tailwind from foreign exchange impacts from a weaker U.S. dollar. We now expect our full year 2025 non-GAAP diluted earnings per share to be between $14.50 and $15.50. We continue to expect total revenue for 2025 to decline by a mid-single-digit percentage, driven primarily by an increased decline in our MS business. We expect that our launch products will generate sequential revenue growth, but we expect the absolute MS revenue decline to be steeper than this growth in 2025. As a reminder, we expect a potential biosimilar entry for TYSABRI in the U.S., which we believe could occur sometime in the fourth quarter of this year. As I mentioned earlier, we have started to see generics for TECFIDERA entering Europe, and while we will continue to vigorously defend our IP, we do expect to see further impacts from generics in Europe this year. We believe that corporate partner revenue will be roughly consistent when comparing full year 2025 with full year 2024. Due to planned maintenance activities and the timing of batch releases, we expect minimal corporate partner revenue in Q4. We believe we are on track to deliver the $1 billion of gross savings and $800 million of net savings under our Fit for Growth initiative. Many of our guidance considerations have remained the same as when we guided for the year back in February. I will also refer you to our press release for other important guidance assumptions. Finally, a topic of great interest to many investors is the impact on our business from tariffs. Biogen currently does not expect a material impact in 2025 from potential tariffs as announced by the U.S. administration on April 2, 2025, even if the exemption for pharmaceuticals were to be removed. This is based on both a significant portion of U.S. revenue being derived from products that have manufacturing operations in the United States, as well as our current global inventory position. Our guidance range also considers potential retaliatory tariffs from China as announced. However, the U.S. and international tariff landscape remains uncertain, and our guidance does not contemplate any new tariffs that may be announced in the future. I’ll also note that when excluding one-time tax impacts, our tax rate is broadly a function of our business mix and therefore does not serve as a good proxy for estimating potential tariff impacts. Biogen's effective tax rate is a reflection of our U.S. market revenues being almost entirely taxable in the U.S. at the full federal plus state tax rates. We generate a relatively high percentage of our revenue outside the U.S., which is taxable in those markets and in the U.S. under the GILTI regime. We will continue to monitor and analyze the current and future U.S. and reciprocal tariff landscape as it evolves. I'll now pass the call over to Chris for some closing comments.

Thank you, Robin. Again, if I come back to where Biogen is going, you just have to look at our pipeline. We've got another four Phase 3 starts that's after the Phase 3 start already in AMR. We've got three clinical trial readouts coming. We've got three regulatory decisions coming. One of the other things I'll say is in this first quarter, we did a significant restructuring of research. I'm really quite excited about what we're doing there, as an industry, we rely too much on late-stage business development. The most cost-effective place to do collaborations is actually pre-clinically, and we have a goal of signing four to five new research collaborations this year. Biogen has been known for breakthrough medicines. In fact, all four products that we launched in 2023 and '24 are first-in-class, first-ever disease-modifying agents. We go after some of the hardest-to-treat diseases. One of the challenges about being a breakthrough company is that you're in diseases where a lot of investment committees are not already doing much research. If I take AMR, the antibody-mediated rejection, for example, there's really no treatment there today. One of the things that we feel we would like to do is to do a deeper dive into some of these diseases and pipeline assets, not intending to present new data, but to say, okay, what's the competitive landscape? What's Biogen's right to win here? What's the patient journey? What will it really take to move the needle on one of these diseases? What will the reimbursement landscape be like? What's the epidemiology? I think AMR is a huge opportunity for Biogen. And we saw 80% resolution of AMR in Phase 2 trials, so we have a high level of confidence in that. We're interested in IgAN. What's it going to take to capture interest in IgAN? I spent an entire day with our West Coast Hub just on felzartamab, and there are a lot of great things happening there. Notably, not all CD38s are alike. We would like to invite whoever is interested to attend some of these thematic seminars. The first one we're going to hold is on June 11, and hopefully, that will be the first of a series. It’s just meant to be educational and to provide a deeper dive, and we’ll have some of our top internal experts available on all subjects to answer any and all questions. So with that, Tim, I'll turn it back to you for Q&A.

Thanks, Chris. Melinda, can we go to our first question, please?

Certainly. Your first question comes from Brian Abrahams with RBC Capital Markets. Please go ahead.

Hey, good morning, and thanks for taking my question. Congrats on the recent LEQEMBI approval in Europe. Can you talk about what the rollout strategy could look like there and your sense of what the reimbursement process and amenability could be? Thanks.

Yeah. Thanks, Brian. That is certainly going to take some time. The fact that the approval took a while tells you that there’s a lot of thought going into that. One of the things about when you first launch a first-in-class disease-modifying agent is that you're not displacing anything in a budget. These products are incremental adds to the total healthcare budget of countries. It can be easier to launch a product that's a me-too that simply cannibalizes the budget of another product. This is obviously a significant market in Europe; Europe is an aging continent, even more so than the United States. There are a lot of eligible patients. We’ll be taking that with our partners Eisai market by market. I do believe that LEQEMBI has run the gauntlet. There has been a full examination of the efficacy, the safety, but also the economic benefit. The EMA does take into account some aspects of the economic impact. The deep interrogation by European Union countries should help us as we go into reimbursement, as it has all been thoroughly evaluated, but I think it will still take some time, and we will see that some countries will launch faster, which is generally the case in Europe.

Thanks, Chris. Let's go to the next question, please.

We go next to Evan Seigerman with BMO Capital Markets.

Hi, all. Thank you so much for taking my question. I want to touch again on LEQEMBI, but this time with the subcutaneous formulation. Maybe remind us how that potential for at-home administration can help accelerate sales in the United States? I mean, we're seeing some good uptake, but I think that could really help get things going further. And maybe some of the hurdles that you have to overcome to really get full penetration there? Thank you.

All right. The first is subcutaneous for maintenance. These are patients who have been undergoing bi-weekly infusions now for 18 months. I think there are two aspects for the commercial. First is, we're busy making sure that physicians and patients understand the need to continue therapy. We have long-term extension data demonstrating that in 36 months after treatment, patients are still doing better on treatment than if they stop. Establishing the maintenance market is key. The patients are older and getting to infusion centers is not always easy. We're simplifying the physician's workload with once monthly dosing, but we believe this will be more effective as a long-term chronic therapy if patients have a more patient-friendly administration like subcutaneous. This will help establish and extend the treatment life of a patient in maintenance. During initiation, we may see some physicians prefer to continue with infusion for a few months timed with MRIs, and then switch to subcutaneous, whereas more rural settings may find subcutaneous administration beneficial from the outset. This will reduce the workload for physicians, and caregivers will appreciate the option for at-home treatment.

Melinda, can we go to the next question, please?

We go to Salveen Richter with Goldman Sachs.

Thank you. Good morning. Just following up on Evan's question here, could you just speak to your thoughts on LEQEMBI uptake and growth going forward, not only with subcutaneous maintenance dosing in the second half, but also with Fujirebio's in vitro diagnostic, which should enter the market as well? Thank you.

We don't have much information about the diagnostic. The process to get a diagnostic approved is different from a drug, and the reimbursement situation is also different. The recent report by the Alzheimer's Association highlighted the need for early diagnosis. Most patients are actually seeing primary care physicians, and it can take a while to distinguish whether this is normal aging, another form of dementia, or Alzheimer’s, sometimes two to three years or more before a diagnosis is made. There’s real interest in early treatment because the earlier we can get to a patient before there has been too much neuronal damage or death, the better. We need to establish those diagnostics. The benefits of this approach would be two-fold: we can get patients on treatment at an earlier stage of their disease, and studies are ongoing to gain evidence of that. At CTAD in 2023, we showed that patients with low tau were stable after six months; 70% were stable and 60% showed some level of improvement. So, blood-based diagnostics will be extremely important, but we have to wait and see where those companies are in the regulatory process.

Can we go to the next question, please?

Your next question comes from Tim Anderson with Bank of America.

Thank you. On LEQEMBI, how are you seeing the market parse out between your product and Lilly's Kisunla? There’s obviously a significant difference in terms of commercial positioning around finite dosing. I'm wondering who's going to win that battle. Are you seeing prescribers take patients off therapy after a period under the idea that once plaque is gone, they no longer need to give the drug?

I think first, I would say we consider the launch of this product to have been September of '23 because that's when we had full approval and reimbursement from CMS. We didn’t even get the question on reimbursement for PET scans clarified until about November of that year. Therefore, I think we’re still early in the launch phase. To your question on this versus donanemab, it depends on the physician. We will see those who favor the idea of finite dosing, but there has been insight at the recent AD/PD that once you have a maintenance indication and see the data, you will realize that once you’ve removed the plaque, you’re not done. There's a chance of plaque returning and potential damage. Education will be necessary to demonstrate the importance of continuing therapy. Ultimately, it will be up to the physician and the patient who may prefer donanemab depending on their condition. We’re focusing on ensuring that more patients benefit from these disease-modifying treatments.

Can we go to the next question, please, Melinda?

Next up is Chris Schott with JPMorgan.

Great. Thanks so much for the question. I would love a bit more elaboration on the latest thoughts on business development in terms of the size and scopes of deals you're considering. It's been a volatile market, and I'm wondering if that's changing your views at all or the range of opportunities that might be available to Biogen. Thank you.

Thanks for that question. There has been a shift in the last four to six weeks. Valuation is one thing, but we are still focused on securing the right assets. Many healthcare investors are facing pressure from LPs and are looking for liquidity. We've had a lot of companies who were reluctant to act due to low valuations, but we’re also finding that many companies are struggling to obtain financing. If you're looking to acquire, there might be an ease in discussions. Moreover, I believe we will see collaborations where companies provide funding as some ventures dry up for others. Biogen is positioned well. We have retained our HI-Bio team and are building out that team, which gives us expertise in collaborations and makes us a trusted partner. There are opportunities out there, but it takes patience and discipline to find the right collaborations.

Thanks, Chris. Could we go to the next question, please?

We'll go to Michael Yee with Jefferies.

Thanks. Good morning. I wanted to ask Priya about the early AHEAD 3-45 study. I know you’ve guided to a 2028 readout. Your competitor is also guiding to a readout, although I think there's an assumption they may come earlier. Can you discuss one or two points about your positioning versus that study and particularly what would make you extremely confident that it’s going to work and/or readout? Because I know that you have an interim but I'm assuming you're not going to take that interim. Thank you.

Yes. Thanks, Mike. Overall, I’d like to start by stating that with Clarity AD, we established that LEQEMBI clears plaque, and that translates to clinical benefit. With regards to the presymptomatic Alzheimer’s disease area, it’s a big spectrum. We believe AHEAD 3-45 is positioned to provide a comprehensive understanding and evaluation of how LEQEMBI can preserve cognition. We are testing it in two parallel trials: AHEAD 3, consisting of 400 subjects, with 20 to 40 centiloids of amyloid, and the other trial being greater than 40 centiloids, which will evaluate whether it prevents cognitive decline. We expect full enrollment and guidance on readout in 2028, reserving the optionality to look at data earlier; though we will not comment on that now. AHEAD 3 tests stopping the accumulation of amyloid while AHEAD 45 focuses on preventing cognitive decline with sensitive clinical endpoints alongside amyloid and tau PET. In contrast, TRAILBLAZER-ALZ 3 evaluates whether donanemab can slow clinical progression in a mixed symptomatic population and presymptomatic patients. AHEAD 3 and AHEAD 45 are part of our strategy to clarify how we can make decisions about treating presymptomatic patients.

From a commercial point of view, AHEAD 3 and AHEAD 45 will provide physicians with the information they need, helping them with the risk-benefit equation when treating healthy patients. There’s ARIA associated with both products, so understanding when to treat earlier and at what level of amyloid burden is essential. The blood-based diagnostics will provide insights into positive tests, which will likely lead to PET scans for assessment. Without a full understanding of the amyloid burden, clinicians may hesitate to treat. I believe AHEAD 3 and AHEAD 45 could be landmark studies in Alzheimer’s.

Can we go to the next question, please, Melinda?

We go next to Umer Raffat with Evercore ISI.

Hi, this is Mike DiFiore for Umer. Thank you for taking our question. I want to ask about LEQEMBI. Lilly's drug generated approximately $20 million to $21 million in sales during its second full quarter of launch. This is slightly ahead of LEQEMBI's sales at the same point. My question is whether Biogen and Eisai have helped facilitate Lilly's position by enhancing the healthcare infrastructure. Can you discuss any competitive dynamics now that you're about 18 months into the launch? Thank you.

I think the answer is probably yes. There's been a lot of hard work, particularly with the IDNs, to develop treatment pathways and protocols necessary. Now we’re moving to the point of evaluating lecanemab versus donanemab. As I mentioned earlier, we want to ensure a market that expands rather than compete for market share in a small pool. We need to increase the number of centers and improve education so more patients can benefit from these new disease-modifying treatments.

Thanks, Chris. Let’s go to the next one, please.

Next up is Terence Flynn with Morgan Stanley.

Great. Thanks so much for taking my questions. There has been substantial focus on the FDA under the new administration. I know you made comments about your Dravet program moving to Phase 3. I'm curious if you could provide high-level comments about your interactions with the FDA, any changes to review teams, and regarding these rare diseases, do you think this FDA will be advancing more rapidly, and be more favorable to the industry regarding surrogate endpoints?

Overall, I'd say based on our interactions during review meetings and requests, we're not really seeing any changes at a high level. We remain on track with our engagements. Regarding Dravet syndrome, the data we saw during diligence has been compelling. First, the patients involved were on standard of care when we assessed the impact of zorevunersen. The burden of disease is high, with some reporting seven to ten seizures a week while on multiple medications. The impact we observed was an 87% seizure reduction in patients on full standard of care. The zorevunersen effect was durable out to about 76% when considering a six-month outlook. Stoke engaged with the FDA, Europe, and Japan, which provided useful regulatory insights for our Phase 3 EMPEROR trial design. We remain confident in the trial's approach to assess it as a potential disease-modifying therapy.

To address the broader question about the FDA, we haven’t encountered significant delays in our interactions. I am encouraged by recent comments from the new commissioner about prioritizing ultra-rare diseases and innovative strategies like surrogate markers to expedite patient access to drugs. There is considerable change happening at the FDA, and we are closely monitoring it. While there have been key leader transitions and staff reductions, we haven’t seen any adverse effects from this, and the new FDA leadership could be beneficial for us.

I know it’s a busy morning, so maybe we can squeeze one last question in here. Melinda, our last question, please?

We go next to Geoff Meacham with Citibank.

Great. Good morning, everyone. Thanks for the question. For Chris or Robin, on manufacturing, Biogen has historically had a lot of capacity in the U.S. going back to the original expectations in Alzheimer's. As we see more companies in biopharma announcing plans to onshore capacity, do you view your own capacity or resources differently? Is there a short-term opportunity to partner that's not in the model?

Yes, we've been utilizing our Solothurn facility, which is actually doing contract manufacturing to absorb capacity. That doesn't help someone looking in the U.S., but in RTP, we manufacture a lot for third-party companies. I knew of the RTP facility's reputation and quality even before joining Biogen. We will be open and looking for opportunities in that front.

Yeah, we have a good mix in both facilities between our own product manufacturing and those for partners.

Well, thanks for your time, everybody. Really appreciate it. If you have more questions later today, just reach out to the IR team. Thank you.

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