Contractual Obligations and Off-Balance Sheet Arrangements

Contractual Obligations

Our contractual obligations primarily consist of our obligations under non-cancellable operating leases, capital leases, long-term debt obligations and defined benefit and other purchase obligations, excluding amounts related to uncertain tax positions, funding commitments, contingent development, regulatory and commercial milestone payments, TYSABRI contingent payments and contingent consideration related to our business combinations, as described below.

On December 1, 2015, we purchased land in Solothurn, Switzerland where we are building a biologics manufacturing facility over the next several years. As of June 30, 2016, we had contractual commitments of approximately $226.0 million for the construction of this facility.

There have been no ~~other~~ material changes in our contractual obligations since December 31, ~~2015.~~

~~Tax Related Obligations~~

We exclude liabilities pertaining to uncertain tax positions from our summary of contractual obligations as we cannot make a reliable estimate of the period of cash settlement with the respective taxing authorities. As of June 30, 2016, we have approximately $70.0 million of liabilities associated with uncertain tax positions.

~~Other Funding Commitments~~

As of June 30, 2016, we have several on-going clinical studies in various clinical trial stages. Our most significant clinical trial expenditures are to contract research organizations (CROs). The contracts with CROs are generally cancellable, with notice, at our option. We have recorded accrued expenses of approximately $36.0 million on our condensed consolidated balance sheet for expenditures incurred by CROs as of June 30, 2016. ~~We have approximately $490.0 million in cancellable future commitments based on existing CRO contracts as of June 30, 2016.~~

As of June 30, 2016, we have planned clinical trials for our nusinersen program which is managed by Ionis. We have agreed to pay up to approximately $72.5 million to Ionis as the trials for this program proceed. If these trials advance, and we continue with our Ionis program, it is possible that we could make a significant amount of additional development payments in the future.

~~Contingent Development, Regulatory and Commercial Milestone Payments~~

Based on our development plans as of June 30, 2016, we could make potential future milestone payments to third parties of up to approximately $3.4 billion as part of our various collaborations, including licensing and development programs. Payments under these agreements generally become due and payable upon achievement of certain development, regulatory or commercial milestones. Because the achievement of these milestones had not occurred as of June 30, 2016, such contingencies have not been recorded in our financial statements. Amounts related to contingent milestone payments are not considered contractual obligations as they are contingent on the successful achievement of certain development, regulatory approval and commercial milestones.

~~We anticipate that we may pay approximately $40.0 million of milestone payments during the remainder of 2016, provided various development, regulatory or commercial milestones are achieved.~~

TYSABRI Contingent Payments

In 2013 we acquired from Elan Corporation plc (Elan) full ownership of all remaining rights to TYSABRI that we did not already own or control. Under the terms of the acquisition agreement, we are obligated to make contingent payments to Elan of 18% on annual worldwide net sales up to $2.0 billion and 25% on annual worldwide net sales that exceed $2.0 billion. Royalty payments to Elan and other third parties are recognized as cost of sales in our condensed consolidated statements of income. Elan was acquired by Perrigo Company plc (Perrigo) in December ~~2013. Following that acquisition, we began making~~2013, and Perrigo subsequently sold its rights to these ~~royalty~~ payments to ~~Perrigo.~~another third party effective January 2017.

Contingent Consideration related to Business Combinations

In connection with our acquisitions of Convergence Pharmaceuticals Ltd. (Convergence), Stromedix, Inc. (Stromedix) and Biogen International Neuroscience GmbH (BIN), formerly Panima Pharmaceuticals AG, we agreed to make additional payments based upon the achievement of certain milestone events.

As the acquisitions of Convergence, Stromedix and BIN ~~formerly Panima Pharmaceuticals AG,~~ occurred after January 1, 2009, we record contingent consideration liabilities at their fair value on the acquisition date and revalue these obligations each reporting period.

We may pay up to approximately ~~$1.3~~$1.2 billion in remaining milestones related to these acquisitions.

Fumapharm AG

In 2006 we acquired Fumapharm AG. As part of this acquisition we acquired FUMADERM and TECFIDERA (together, Fumapharm Products). We are required to make contingent payments to former shareholders of Fumapharm AG or holders of their rights based on the attainment of certain cumulative sales levels of Fumapharm Products and the level of total net sales of Fumapharm Products in the prior ~~twelve~~12- month period.

During the six months ended June 30, ~~2016,~~2017, we paid $600.0 million in contingent payments as we reached the ~~$7.0~~$11.0 billion and ~~$8.0~~$12.0 billion cumulative sales levels related to the Fumapharm Products in the fourth quarter of ~~2015~~2016 and the first quarter of ~~2016,~~2017, respectively, and accrued $300.0 million upon reaching ~~$9.0~~$13.0 billion in total cumulative sales of Fumapharm Products in the second quarter of ~~2016.~~2017.

We will owe an additional $300.0 million contingent payment for every additional $1.0 billion in cumulative sales level of Fumapharm Products reached if the prior 12 months sales of the Fumapharm Products exceed $3.0 billion, until such time as the cumulative sales level reaches $20.0 billion, at which time no further contingent payments ~~shall~~will be due. If the prior 12 months sales of Fumapharm Products are less than $3.0 billion, contingent payments remain payable on a decreasing tiered basis. These payments ~~will~~would be accounted for as an increase to goodwill as incurred, in accordance with the accounting standard applicable to business combinations when we acquired ~~Fumapharm.~~Fumapharm AG. Any portion of the payment ~~which~~that is tax deductible will be recorded as a reduction to goodwill. Payments are due within 60 days following the end of the quarter in which the applicable cumulative sales level has been reached.

Contingent Development, Regulatory and Commercial Milestone Payments

Based on our development plans as of June 30, 2017, we could make potential future milestone payments to third parties of up to approximately $3.1 billion, including approximately $0.6 billion in development milestones, approximately $0.9 billion in regulatory milestones and approximately $1.6 billion in commercial milestones, as part of our various collaborations, including licensing and development programs. Payments under these agreements generally become due and payable upon achievement of certain development, regulatory or commercial milestones. Because the achievement of these milestones had not occurred as of June 30, 2017, such contingencies have not been recorded in our financial statements. Amounts related to contingent milestone payments are not considered contractual

obligations as they are contingent on the successful achievement of certain development, regulatory approval or commercial milestones.

Provided various development, regulatory or commercial milestones are achieved, we anticipate that we may pay approximately $55.0 million of milestone payments during the remainder of 2017 in addition to the $90.0 million in payments to Ionis for the regulatory approvals of SPINRAZA in the E.U. and Japan and a $60.0 million developmental milestone payment to the former stockholders of iPierian upon dosing of the first patient in the Phase 2 PSP study for BIIB092.

Other Funding Commitments

As of June 30, 2017, we have several ongoing clinical studies in various clinical trial stages. Our most significant clinical trial expenditures are to contract research organizations (CROs). The contracts with CROs are generally cancellable, with notice, at our option. We recorded accrued expenses of approximately $36.0 million in our condensed consolidated balance sheet for expenditures incurred by CROs as of June 30, 2017. We have approximately $442.0 million in cancellable future commitments based on existing CRO contracts as of June 30, 2017.

Tax Related Obligations

We exclude liabilities pertaining to uncertain tax positions from our summary of contractual obligations as we cannot make a reliable estimate of the period of cash settlement with the respective taxing authorities. As of June 30, 2017, we have approximately $36.0 million of liabilities associated with uncertain tax positions.

Other Off-Balance Sheet Arrangements

We do not have any relationships with entities often referred to as structured finance or special purpose entities that were established for the purpose of facilitating off-balance sheet arrangements. As such, we are not exposed to any financing, liquidity, market or credit risk that could arise if we had engaged in such relationships. We consolidate variable interest entities if we are the primary beneficiary.

New Accounting Standards

For a discussion of new accounting standards please read Note 1, Summary of Significant Accounting Policies - New Accounting Pronouncements, to our condensed consolidated financial statements included in this report.

Critical Accounting Estimates

The preparation of our condensed consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the U.S. (U.S. GAAP), requires us to make estimates, judgments and assumptions that may affect the reported amounts of assets, liabilities, equity, revenues and expenses and related disclosure of contingent assets and liabilities. On an ~~on-going~~ongoing basis we evaluate our estimates, judgments and methodologies. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable, the results of which form the basis for making judgments about the carrying values of assets, liabilities and equity and the amount of revenues and expenses. Actual results may differ from these estimates under different assumptions or conditions.

For a discussion of our critical accounting estimates, please read Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our ~~2015~~2016 Form 10-K. There have been no material changes to these critical accounting estimates since our ~~2015~~2016 Form 10-K.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Market Risk

We are subject to certain risks which may affect our results of operations, cash flows and fair values of assets and liabilities, including volatility in foreign currency exchange rates, interest rate movements, pricing pressures worldwide and weak economic conditions in the foreign markets in which we operate. We manage the impact of foreign currency exchange rates and interest rates through various financial instruments, including derivative instruments such as foreign currency forward contracts, interest rate lock contracts and interest rate swap contracts. We do not enter into financial instruments for trading or speculative purposes. The ~~counter-parties~~counterparties to these contracts are major financial institutions, and there is no significant concentration of exposure with any one ~~counter-party.~~counterparty.

Foreign Currency Exchange Risk

Our results of operations are subject to foreign currency exchange rate fluctuations due to the global nature of our operations. We have operations or maintain distribution relationships in the U.S., Europe, Canada, Asia, and Central and South America. In addition, we recognize our share of pre-tax co-promotion profits on RITUXAN in Canada. As a result, our financial position, results of operations and cash flows can be affected by market fluctuations in foreign currency exchange rates, primarily with respect to the Euro, British pound sterling, Canadian dollar, Swiss franc, Danish krone and Japanese yen.

While the financial results of our global activities are reported in U.S. dollars, the functional currency for most of our foreign subsidiaries is their respective local currency. Fluctuations in the foreign currency exchange rates of the countries in which we do business will affect our operating results, often in ways that are difficult to predict. In particular, as the U.S. dollar strengthens versus other currencies, the value of the non-U.S. revenue will decline when reported in U.S. dollars. The impact to net income as a result of a strengthening U.S. dollar will be partially mitigated by the value of non-U.S. expense which will also decline when reported in U.S. dollars. As the U.S. dollar weakens versus other currencies, the value of the non-U.S. revenue and expenses will increase when reported in U.S. dollars.

We have established revenue and operating expense hedging and balance sheet risk management programs to protect against volatility of future foreign currency cash flows and changes in fair value caused by volatility in foreign currency exchange rates.

In June 2016 the U.K. voted in a referendum to voluntarily depart from the E.U., known as ~~Brexit.~~Brexit, and in March 2017, the U.K. formally started the process for the U.K. to leave the E.U. The macroeconomic impact on our results of operations from ~~this vote~~these developments remains unknown. To date, the foreign currency exchange impact has been negligible since we hedged the balance sheet foreign currency exchange risk.

Revenue and Operating Expense Hedging Program

Our foreign currency hedging program is designed to mitigate, over time, a portion of the impact resulting from volatility in exchange rate changes on revenues and operating expenses. We use foreign currency forward contracts to manage foreign currency risk, with the majority of our forward contracts used to hedge certain forecasted revenue and operating expense transactions denominated in foreign currencies in the next 1824 months. We do not engage in currency speculation. For a more detailed disclosure of our revenue and operating expense hedging program, please read Note 8,9, Derivative Instruments, to our condensed consolidated financial statements included in this report.

Our ability to mitigate the impact of exchange rate changes on revenues and net income diminishes as significant exchange rate fluctuations are sustained over extended periods of time. In particular, devaluation or significant deterioration of foreign currency exchange rates are difficult to mitigate and likely to negatively impact earnings. The cash flows from these contracts are reported as operating activities in our condensed consolidated statements of cash flows.

Balance Sheet Risk Management Hedging Program

We also use forward contracts to mitigate the foreign currency exposure related to certain balance sheet items. The primary objective of our balance sheet risk management program is to mitigate the exposure of foreign currency denominated net monetary assets and liabilities of foreign affiliates. In these instances, we principally utilize currency forward contracts. We have not elected hedge accounting for the balance sheet related items. The cash flows from these contracts are reported as operating activities in our condensed consolidated statement of cash flows.

The following quantitative information includes the impact of currency movements on forward contracts used in our revenue, operating expense and balance sheet hedging programs. As of June 30, ~~2016~~2017 and December 31, ~~2015,~~2016, a hypothetical adverse 10% movement in foreign currency rates compared to the U.S. dollar across all maturities would result in a hypothetical decrease in the fair value of forward contracts of approximately ~~$178.0~~$234.0 million and ~~$185.0~~$172.0 million, respectively. The estimated fair value change was determined by measuring the impact of the hypothetical exchange rate movement on outstanding forward contracts. Our use of this methodology to quantify the market risk of such instruments is subject to assumptions and actual impact could be significantly different. The quantitative information about market risk is limited because it does not take into account all foreign currency operating transactions.

Interest Rate Risk

Our investment portfolio includes cash equivalents and short-term investments. The fair value of our marketable securities is subject to change as a result of potential changes in market interest rates. The potential change in fair value for interest rate sensitive instruments has been assessed on a hypothetical 100 basis point adverse movement across all maturities. As of June 30, ~~2016~~2017 and December 31, ~~2015,~~2016, we estimate that such hypothetical 100 basis point adverse movement would result in a hypothetical loss in fair value of approximately ~~$50.0~~$48.0 million and ~~$43.0~~$50.0 million, respectively, to our interest rate sensitive instruments. The fair values of our investments were determined using third-party pricing services or other market observable data.

To achieve a desired mix of fixed and floating interest rate debt, we entered into interest rate swap contracts during 2015 for certain of our fixed-rate debt. These derivative contracts effectively converted a fixed-rate interest coupon to a floating-rate LIBOR-based coupon over the life of the respective note. As of June 30, ~~2016~~2017 and December 31, ~~2015,~~2016, a 100 basis-point adverse movement (increase in LIBOR) would increase annual interest expense by approximately $6.8 ~~million, respectively.~~million.

Pricing Pressure

Governments in some international markets in which we operate have implemented measures aimed at reducing healthcare costs to ~~constrain~~limit the overall level of government expenditures. These implemented measures vary by country and include, among other things, mandatory rebates and discounts, prospective and possible retroactive price reductions and suspensions on price increases of pharmaceuticals.

In addition, certain countries set prices by reference to the prices in other countries where our products are marketed. Thus, our inability to secure favorable prices in a particular country may impair our ability to obtain acceptable prices in existing and potential new markets, ~~and~~which may limit market growth. The continued implementation of pricing actions throughout Europe may also lead to higher levels of parallel trade.

In the U.S., federal and state legislatures, health agencies and third-party payors continue to focus on containing the cost of health care. Legislative and regulatory proposals, enactments to reform health care insurance programs and increasing pressure from social sources could significantly influence the manner in which our products are prescribed and purchased. It is possible that additional federal health care reform measures will be adopted in the future, which could result in increased pricing pressure and reduced reimbursement for our products and otherwise have an adverse impact on our financial position or results of operations.

Our products are also susceptible to increasing competition from generics and biosimilars in many markets. Generic versions of drugs and biosimilars are likely to be sold at substantially lower prices than branded products. Accordingly, the introduction of generic or biosimilar versions of our marketed products, as well as lower-priced competing products, likely would significantly reduce both the price that we receive for such marketed products and the volume of products that we sell, which may have an adverse impact on our results of operations.

There is also significant economic pressure on state budgets that may result in states increasingly seeking to achieve budget savings through mechanisms that limit coverage or payment for our drugs. Managed care organizations are also continuing to seek price discounts and, in some cases, to impose restrictions on the coverage of particular drugs.

Credit Risk

We are subject to credit risk from our accounts receivable related to our product sales. The majority of our accounts receivable arise from product sales in the U.S. and Europe with concentrations of credit risk limited due to the wide variety of customers and markets using our products, as well as their dispersion across many different geographic areas. Our accounts receivable are primarily due from wholesale distributors, public hospitals and other government entities. We monitor the financial performance and creditworthiness of our customers so that we can properly assess and respond to changes in their credit profile. We operate in certain countries where weakness in economic conditions can result in extended collection periods. We continue to monitor these conditions, including the volatility associated with international economies and the relevant financial markets, and assess their possible impact on our business. To date, we have not experienced any significant losses with respect to the collection of our accounts receivable.

Credit and economic conditions in the E.U. continue to remain uncertain, which has, from time to time, led to long collection periods for our accounts receivable and greater collection risk in certain countries.

We believe that our allowance for doubtful accounts was adequate as of June 30, ~~2016~~2017 and December 31, ~~2015.~~2016. However, if significant changes occur in the availability of government funding or the reimbursement practices of these or other governments, we may not be able to collect on amounts due to us from customers in such countries and our results of operations could be adversely affected.

Item 4. Controls and Procedures

Disclosure Controls and Procedures and Internal Control over Financial Reporting

Controls and Procedures

We have carried out an evaluation, under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, of the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended), as of June 30, ~~2016.~~2017. Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures are effective in ensuring that (a) the information required to be disclosed by us in the reports that we file or submit under the Securities Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities Exchange Commission’s rules and forms, and (b) such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, our management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures.

Changes in Internal Control over Financial Reporting

There were no changes in our internal control over financial reporting during the quarter ended June 30, ~~2016,~~2017, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Part II — OTHER INFORMATION

Item 1. Legal Proceedings

Please refer to Note ~~18,~~19, Litigation, to our condensed consolidated financial statements included in this report, which is incorporated into this item by reference.

Item 1A. Risk Factors

We are substantially dependent on revenues from our principal products.

Our current revenues depend upon continued sales of our principal products, and, unless we develop or acquire rights to new products and technologies, we ~~are~~may be substantially dependent on sales from our principal products for many years. Further, iffollowing the ~~proposed spin off~~completion of the spin-off of our hemophilia business, ~~is completed,~~ our revenues ~~will be~~are further reliant and concentrated on sales of our MS products in an increasingly competitive ~~market.~~market, and revenue from sales of our product for SMA. Any of the following negative developments relating to any of our principal products may adversely affect our revenues and results of operations or could cause a decline in our stock price:

safety or efficacy issues;

the introduction or greater acceptance of competing products, including lower-priced competing products;

constraints and additional pressures on product pricing or price increases, ~~due to a number of factors,~~ including those resulting from governmental or regulatory requirements, increased competition, or changes in, or, implementation of, reimbursement policies and practices of payors and other third parties; or

adverse legal, administrative, regulatory or legislative developments.

SPINRAZA was recently approved by the FDA, the European Commission and the Japanese Ministry of Health, Labor and Welfare, and is in the early stages of commercial launch. In addition to risks associated with new product launches and the other factors described in these “Risk Factors”, our ability to successfully commercialize SPINRAZA may be adversely affected due to:

our limited marketing experience within the SMA market, which may impact our ability to develop relationships with the associated medical and scientific community;

the lack of readiness of healthcare providers to treat patients with SMA;

the effectiveness of our commercial strategy for marketing SPINRAZA; and

our ability to maintain a positive reputation among patients, healthcare providers and others in the SMA community, which may be impacted by pricing and reimbursement decisions relating to SPINRAZA.

If we fail to compete effectively, our business and market position would suffer.

The biopharmaceutical industry and the markets in which we operate are intensely competitive. We compete in the marketing and sale of our products, the development of new products and processes, the acquisition of rights to new products with commercial potential and the hiring and retention of personnel. We compete with biotechnology and pharmaceutical companies that have a greater number of products on the market and in the product pipeline, greater financial and other resources and other technological or competitive advantages. One or more of our competitors may benefit from significantly greater sales and marketing capabilities, may develop products that are accepted more widely than ours or may receive patent protection that dominates, blocks or adversely affects our product development or business.

In the MS market, we face intense competition as the number of products and competitors continues to expand. Due to our significant reliance on sales of our MS products, our business may be harmed if we are unable to successfully compete in the MS market. More specifically, our ability to compete, maintain and grow our share in the MS market may be adversely affected due to a number of factors, including:

the introduction of more efficacious, safer, less expensive or more convenient alternatives to our MS products, including our own products and products of our collaborators;

the introduction of lower-cost biosimilars, follow-on products or generic versions of branded MS products sold by our competitors, and the possibility of future competition from generic versions or prodrugs of existing therapeutics or from off-label use by physicians of therapies indicated for other conditions to treat MS patients;

patient dynamics, including the size of the patient population and our ability to attract new patients to our therapies;

damage to physician and patient confidence in any of our MS products or to our sales and reputation as a result of label changes or adverse experiences or events that may occur with patients treated with our MS products;

inability to obtain appropriate pricing and reimbursement for our MS products compared to our competitors in key international markets; or

our ability to obtain and maintain patent, data or market exclusivity for our MS products.

Similarly, the hemophilia treatment market is a highly competitive market, with current treatments marketed by companies that have substantially greater financial resources and marketing expertise. Our ability to successfully compete in the hemophilia market and gain share in this market may be adversely affected due to a number of reasons, including:

~~difficulty in further penetrating this market if our therapies are not regarded by patients, healthcare providers or payers as offering significant benefits and value over current treatments;~~

changes in technology, including the introduction by other companies of new technologies, such as gene therapies and bispecific antibody technology that have the potential to transform the standard of care in hemophilia, or longer-lasting or more efficacious, safer, less expensive or more convenient treatments than our therapies; or

our limited marketing experience within the hemophilia treatment market relative to certain of our competitors, which may impact our ability to develop relationships with the associated medical and scientific community.

Sales of our products depend, to a significant extent, on adequate coverage, pricing and reimbursement from ~~third-party~~third party payors, which are subject to increasing and intense pressure from political, social, competitive and other sources. Our inability to maintain adequate coverage, or a reduction in pricing or reimbursement, could have an adverse effect on our business, revenues and results of operations, and could cause a decline in our stock price.

Sales of our products are dependent, in large part, on the availability and extent of coverage, pricing and reimbursement from government health administration authorities, private health insurers and other organizations. When a new pharmaceutical product is approved, the availability of government and private reimbursement for that product may be uncertain, as is the pricing and amount for which that product will be reimbursed.

Pricing and reimbursement for our products may be adversely affected by a number of factors, including:

changes in, and implementation of, federal, state or foreign government regulations or private third-party payors' reimbursement policies;

pressure by employers on private health insurance plans to reduce costs; and

consolidation and increasing assertiveness of payors, including managed care organizations, health insurers, pharmacy benefit managers, government health administration authorities, private health insurers and other organizations, seeking price discounts or rebates in connection with the placement of our products on their formularies and, in some cases, the imposition of restrictions on access or coverage of particular drugs or pricing determined based on perceived value.

Our ability to set the price for our products can vary significantly from country to country and as a result so can the price of our products. Certain countries set prices by reference to the prices in other countries where our products are marketed. Thus, our inability to secure adequate prices in a particular country may not only limit the revenue from our products within that country, but may also adversely affect our ability to obtain acceptable prices in other markets. This may create the opportunity for third-party cross-border trade or influence our decision to sell or not to sell a product, thus adversely affecting our geographic expansion plans and revenues.

Our failure to maintain adequate coverage, pricing or reimbursement for our products would have an adverse effect on our business, revenues and results of ~~operation,~~operations, could curtail or eliminate our ability to adequately fund research and development programs for the discovery and commercialization of new products, and could cause a decline in our stock price.

Drug prices are under significant scrutiny in the markets in which our products are prescribed. ~~Drug~~We expect drug pricing and other health care costs to continue to be subject to intense political and societal pressures ~~which we anticipate will continue and escalate~~ on a global basis. In addition, competition from current and future competitors may negatively impact our ability to maintain pricing and our market share. New products or treatments brought to market by our competitors could cause

revenues for our products to decrease due to potential price reductions and lower sales volumes. As a result, our business and reputation may be harmed, our stock price may be adversely impacted and experience periods of volatility and our results of operations may be adversely impacted.

Our results of operations may be adversely affected by current and potential future healthcare reforms.

In the U.S., federal and state legislatures, health agencies and third-party payors continue to focus on containing the cost of health care. Legislative and regulatory proposals and enactments to reform health care insurance programs could significantly influence the manner in which our products are prescribed and purchased. For example, provisions of the Patient Protection and Affordable Care Act (PPACA) have resulted in changes in the way health care is paid for by both governmental and private insurers, including increased rebates owed by manufacturers under the Medicaid Drug Rebate Program, annual fees and taxes on manufacturers of certain branded prescription drugs, the requirement that manufacturers participate in a discount program for certain outpatient drugs under Medicare Part D and the expansion of the number of hospitals eligible for discounts under Section 340B of the Public Health Service Act. These changes have had and are expected to continue to have a significant impact on our business.

We may face uncertainties as a result of federal and administrative efforts to repeal, substantially modify or invalidate some or all of the provisions of the PPACA. There is no assurance that the PPACA, as currently enacted or as amended in the future, will not adversely affect our business and financial results, and we cannot predict how future federal or state legislative or administrative changes relating to healthcare reform will affect our business.

The administration has also indicated an intent to address prescription drug pricing and recent Congressional hearings have brought increased public attention to the costs of prescription drugs. These actions and the uncertainty about the future of the PPACA and healthcare laws may put downward pressure on pharmaceutical pricing and increase our regulatory burdens and operating costs.

There is also significant economic pressure on state budgets that may result in states increasingly seeking to achieve budget savings through mechanisms that limit coverage or payment for our drugs. In recent years, some states have considered legislation and ballot initiatives that would control the prices of drugs, including laws to allow importation of pharmaceutical products from lower cost jurisdictions outside the U.S. and laws intended to impose price controls on state drug purchases. State Medicaid programs are increasingly requesting manufacturers to pay supplemental rebates and requiring prior authorization by the state program for use of any drug for which supplemental rebates are not being paid. Government efforts to reduce Medicaid expenses may lead to increased use of managed care organizations by Medicaid programs. This may result in managed care organizations influencing prescription decisions for a larger segment of the population and a corresponding constraint on prices and reimbursement for our products. In addition, under the PPACA, as states implement their health care marketplaces or operate under the federal exchange, the impact on drug manufacturers, including us, will depend in part on the formulary and benefit design decisions made by insurance sponsors or plans participating in these programs. It is possible that we may need to provide discounts or rebates to such plans in order to maintain favorable formulary access for our products for this patient population, which could have an adverse impact on our sales and results of operations.

In the E.U. and some other international markets, the government provides health care at low cost to consumers and regulates pharmaceutical prices, patient eligibility or reimbursement levels to control costs for the government-sponsored health care system. Many countries have announced or implemented measures to reduce health care costs to constrain their overall level of government expenditures. These measures vary by country and may include, among other things, patient access restrictions, suspensions on price increases, prospective and possibly retroactive price reductions and other recoupments and increased mandatory discounts or rebates, recoveries of past price increases and greater importation of drugs from lower-cost countries to higher-cost countries. These measures have negatively impacted our revenues, and may continue to adversely affect our revenues and results of operations in the future.

Adverse safety events or restrictions on use and safety warnings for our products can negatively affect our business, product sales and stock price.

Adverse safety events involving our marketed products may have a negative impact on our business. Discovery of safety issues with our products could create product liability and could cause additional regulatory scrutiny and requirements for additional labeling or safety monitoring, withdrawal of products from the market and the imposition of fines or criminal penalties. Adverse safety events may also damage physician and patient confidence in our products and our reputation. Any of these could result in liabilities, loss of revenue, material write-offs of inventory, material impairments of intangible assets, goodwill and fixed assets, material restructuring charges and other adverse impacts on our results of operations.

Regulatory authorities are making greater amounts of stand-alone safety information directly available to the public through periodic safety update reports, patient registries and other reporting requirements. The reporting of adverse safety events involving our products or products similar to ours and public rumors about such events may

increase claims against us and may also cause our product sales or stock price to decline or experience periods of volatility.

Restrictions on use or significant safety warnings that may be required to be included in the label of our products, such as the risk of developing progressive multifocal leukoencephalopathy, ~~(PML),~~ a serious brain infection, or liver injury, in the label for certain of our products, may significantly reduce expected revenues for those products and require significant expense and management time.

If we are unable to obtain and maintain adequate protection for our data, intellectual property and other proprietary rights, our business may be harmed.

Our success depends in part on our ability to obtain and defend patent and other intellectual property rights that are important to the commercialization of our products and product candidates. The degree of patent protection that will be afforded to our products and processes in the U.S. and in other important markets remains uncertain and is dependent upon the scope of protection decided upon by the patent offices, courts, administrative bodies and lawmakers in these countries. We can provide no assurance that we will successfully obtain or preserve patent protection for the technologies incorporated into our products and processes, or that the protection obtained will be of sufficient breadth and degree to protect our commercial interests in all countries where we conduct business. If we cannot prevent others from exploiting our inventions, we will not derive the benefit from them that we currently expect. Furthermore, we can provide no assurance that our products will not infringe patents or other intellectual property rights held by third parties.

We also rely on regulatory exclusivity for protection of our products. Implementation and enforcement of regulatory exclusivity, which may consist of regulatory data protection and market protection, varies widely from country to country. Failure to qualify for regulatory exclusivity, or failure to obtain or maintain the extent or duration of such protections that we expect in each of the markets for our products due to challenges, changes or interpretations in the law or otherwise, could affect our revenue for our products or our decision on whether to market our products in a particular country or countries or could otherwise have an adverse impact on our results of operations.

Litigation, interferences, oppositions, inter partes reviews or other proceedings are, have been and may in the future be necessary in some instances to determine the validity and scope of certain of our proprietary rights, and in other instances to determine the validity, scope or non-infringement of certain patent rights claimed by third parties to be pertinent to the manufacture, use or sale of our products. We may also face challenges to our patent and regulatory protections covering our products by third parties, including manufacturers of generics and biosimilars that may choose to launch or attempt to launch their products before the expiration of our patent or regulatory exclusivity. Litigation, interference, oppositions, inter partes reviews, administrative challenges or other similar types of proceedings are unpredictable and may be protracted, expensive and distracting to management. The outcome of such proceedings could adversely affect the validity and scope of our patent or other proprietary rights, hinder our ability to manufacture and market our products, require us to seek a license for the infringed product or technology or result in the assessment of significant monetary damages against us that may exceed amounts, if any, accrued in our financial statements. An adverse determination in a judicial or administrative proceeding or a failure to obtain necessary licenses could prevent us from manufacturing or selling our products. Furthermore, payments under any licenses that we are able to obtain would reduce our profits derived from the covered products and services.

Our long-term success depends upon the successful development of new products and additional indications for existing products.

Our long-term viability and growth will depend upon successful development of additional indications for our existing products as well as successful development of new products and technologies from our research and development activities, our biosimilars joint venture with Samsung Biologics or licenses or acquisitions from third parties.

Product development is very expensive and involves a high degree of risk. Only a small number of research and development programs result in the commercialization of a product. Clinical trials may indicate that our product candidates lack efficacy, have harmful side effects, result in unexpected adverse events or raise other concerns that may significantly reduce the likelihood of regulatory approval. This may result in terminated programs, significant restrictions on use and safety warnings in an approved label, adverse placement within the treatment paradigm or significant reduction in the commercial potential of the product candidate.

Clinical trials and the development of biopharmaceutical products is a lengthy and complex process. If we fail to adequately manage our clinical activities, our clinical trials or potential regulatory approvals may be delayed or denied.

Conducting clinical trials is a complex, time-consuming and expensive process. Our ability to complete clinical trials in a timely fashion depends in large part on a number of key factors. These factors include protocol design, regulatory and institutional review board approval, patient enrollment rates and compliance with extensive current Good Clinical Practices. If we or our third-party clinical trial providers or third-party contract research organizations, or CROs, do not successfully carry out these clinical activities, our clinical trials or the potential regulatory approval of a product candidate may be delayed or be unsuccessful.

We have opened clinical sites and are enrolling patients in a number of countries where our experience is more limited. In most cases, we use the services of third parties to carry out our clinical trial related activities and rely on such parties to accurately report their results. Our reliance on third parties for these activities may impact our ability to control the timing, conduct, expense and quality of our clinical trials. One CRO has responsibility for a substantial portion of our clinical trial related activities and reporting. If this CRO does not adequately perform, many of our trials may be affected. We may need to replace our CROs. Although we believe there are a number of other CROs we could engage to continue these activities, the replacement of an existing CRO may result in the delay of the affected trials or otherwise adversely affect our efforts to obtain regulatory approvals and commercialize our product candidates.

Successful preclinical work or early stage clinical trials does not ensure success in later stage trials, regulatory approval or commercial viability of a product.

Positive results in a trial may not be replicated in subsequent or confirmatory trials. Additionally, success in preclinical work or early stage clinical trials does not ensure that later stage or larger scale clinical trials will be successful or that regulatory approval will be obtained. In addition, even if later stage clinical trials are successful, regulatory authorities may delay or decline approval of our product candidates. Regulatory authorities may disagree with our view of the data, require additional studies or disagree with our trial design or endpoints. Regulatory authorities may also fail to approve the facilities or the processes used to manufacture a product candidate, our dosing or delivery methods or companion devices. Regulatory authorities may grant marketing approval that is more restricted than anticipated. These restrictions may include limiting indications to narrow patient populations and the imposition of safety monitoring, educational requirements and risk evaluation and mitigation strategies. The occurrence of any of these events could result in significant costs and expenses, have an adverse effect on our business, financial condition and results of operations, and cause our stock price to decline or experience periods of volatility.

Even if we are able to successfully develop new products or indications, sales of new products or products with additional indications may not meet investor expectations. We may also make a strategic decision to discontinue development of a product or indication if, for example, we believe commercialization will be difficult relative to the standard of care or other opportunities in our pipeline.

Conducting clinical trials is a complex, time-consuming and expensive process. Our ability to complete clinical trials in a timely fashion depends in large part on a number of key factors. These factors include protocol design, regulatory and institutional review board approval, patient enrollment rates and compliance with current Good Clinical Practices. If we or our third-party clinical trial providers or third-party CROs do not successfully carry out these clinical activities, our clinical trials or the potential regulatory approval of a product candidate may be delayed or be unsuccessful.

We have opened clinical sites and are enrolling patients in a number of countries where our experience is limited. In most cases, we use the services of third parties to carry out our clinical trial related activities and rely on such parties to accurately report their results. Our reliance on third parties for these activities may impact our ability to control the timing, conduct, expense and quality of our clinical trials. One CRO has responsibility for a substantial portion of our clinical trial related activities and reporting. If this CRO does not adequately perform, many of our trials may be affected. We may need to replace our CROs. Although we believe there are a number of other CROs we could engage to continue these activities, the replacement of an existing CRO may result in the delay of the affected trials or otherwise adversely affect our efforts to obtain regulatory approvals and commercialize our product candidates.

Management and key personnel changes may disrupt our operations, and we may have difficulty retaining key personnel or attracting and retaining qualified replacements on a timely basis for management and other key personnel who may leave the Company.

We have experienced changes in management and other key personnel in critical functions across our ~~organization. In July 2016, we announced that~~organization, including most recently our chief executive officer ~~will be leaving~~and our company after his successor is identified. It is possible that we may experience other personnel changes in connection with our business operations and the proposed spin off of our hemophilia business.chief financial officer. Changes in management and other key personnel have the potential to disrupt our business, and any such disruption could adversely affect our operations, programs, growth, financial condition and results of operations. Further, new members of management may have different perspectives on programs and opportunities for our business, which may cause us to focus on new business opportunities or reduce or change emphasis on our existing business programs.

Our success is dependent upon our ability to attract and retain qualified management and key personnel in a highly competitive environment. Qualified individuals are in high demand, and we may incur significant costs to attract them, particularly at the executive level. We may face difficulty in attracting and retaining key talent for a number of reasons, such as management changes, the underperformance or discontinuation of one or more late stage programs or recruitment by competitors. We cannot assure you that we will be able to hire or retain the personnel necessary for our operations or that the loss of any such personnel will not have a material impact on our financial condition and results of operations.

Manufacturing issues could substantially increase our costs, limit supply of our products and reduce our revenues.

The process of manufacturing our products is complex, highly regulated and subject to numerous risks, including:

Risk of Product Loss. The manufacturing process for our products is extremely susceptible to product loss due to contamination, oxidation, equipment failure or improper installation or operation of equipment, or vendor or operator error. Even minor deviations from normal manufacturing processes could result in reduced production yields, product defects and other supply disruptions. If microbial, viral or other contaminations are discovered in our products or manufacturing facilities, we may need to close our manufacturing facilities for an extended period of time to investigate and remediate the contaminant.

Risks of Reliance on Third Parties and Single Source Providers. We rely on third-party suppliers and manufacturers for many aspects of our manufacturing process for our products and product candidates. In some cases, due to the unique manner in which our products are manufactured, we rely on single source providers of ~~several~~ raw materials and manufacturing supplies. These third parties are independent entities subject to their own unique operational and financial risks that are outside of our control. These third parties may not perform their obligations in a timely and cost-effective manner or in compliance with applicable regulations, and they may be unable or unwilling to increase production capacity commensurate with demand for our existing or future products. Finding alternative providers could take a significant amount of time and involve significant expense due to the specialized nature of the services and the need to obtain regulatory approval of any significant changes to our suppliers or manufacturing methods. We cannot be certain that we could reach agreement with alternative providers or that the FDA or other regulatory authorities would approve our use of such alternatives.

Global Bulk Supply Risks. We rely on our principal manufacturing facilities ~~in Cambridge, MA, RTP, NC and Hillerød, Denmark~~ for the production of drug substance for our large molecule products and product candidates. Our global bulk supply of these products and product candidates depends on the uninterrupted and efficient operation of these facilities, which could be adversely affected by equipment failures, labor shortages, natural disasters, power failures and numerous other factors.

Risks Relating to Compliance with ~~cGMP.~~current Good Manufacturing Practices (cGMP). We and our third-party providers are generally required to maintain compliance with cGMP and other stringent requirements and are subject to inspections by the FDA and comparable agencies in other jurisdictions to confirm such compliance. Any delay, interruption or other issues that arise in the manufacture, fill-finish, packaging or storage of our products as a result of a failure of our facilities or the facilities or operations of third parties to pass any regulatory agency inspection could significantly impair our ability to develop and commercialize our products. Significant noncompliance could also result in the imposition of monetary penalties or other civil or criminal sanctions and damage our reputation.

Any adverse developments affecting our manufacturing operations or the operations of our third-party suppliers and manufacturers may result in shipment delays, inventory shortages, lot failures, product withdrawals or recalls or other interruptions in the commercial supply of our products. We may also have to take inventory write-offs and incur other charges and expenses for products that fail to meet specifications, undertake costly remediation efforts or seek more costly manufacturing alternatives. Such developments could increase our manufacturing costs, cause us to lose revenue or market share as patients and physicians turn to competing therapeutics, diminish our profitability or damage our reputation.

We depend on relationships with collaborators and other third parties for revenue, and for the development, regulatory approval, commercialization and marketing of certain of our products and product candidates, which are outside of our full control.

We rely on a number of significant collaborative and other third-party relationships for revenue, and for the development, regulatory approval, commercialization and marketing of certain of our products and product candidates. We also outsource to third parties certain aspects of our regulatory affairs and clinical development relating to our products and product candidates. Reliance on collaborative and other third-party relationships subjects us to a number of risks, including:

we may be unable to control the resources our ~~collaborator~~collaborators or third ~~party devotes~~parties devote to our programs or products;

disputes may arise under the agreement, including with respect to the achievement and payment of milestones or ownership of rights to technology developed with our ~~collaborator~~collaborators or other third ~~party,~~parties, and the underlying

contract with our ~~collaborator~~collaborators or other third ~~party~~parties may fail to provide significant protection or may fail to be effectively enforced if the ~~collaborator~~collaborators or third ~~party fails~~parties fail to perform;

the interests of our ~~collaborator~~collaborators or third ~~party~~parties may not always be aligned with our interests, and such ~~party~~parties may not pursue regulatory approvals or market a product in the same manner or to the same extent that we would, which could adversely affect our revenues;

third-party relationships and collaborations often require the parties to cooperate, and failure to do so effectively could adversely affect product sales, or the clinical development or regulatory approvals of products under joint control or could result in termination of the research, development or commercialization of product candidates or result in litigation or arbitration; and

any failure on the part of our ~~collaborator~~collaborators or other third ~~party~~parties to comply with applicable laws and regulatory requirements in the marketing, sale and maintenance of the ~~market~~marketing authorization of our products or to fulfill any responsibilities our ~~collaborator~~collaborators or other third parties may have to protect and enforce any intellectual property rights underlying our products could have an adverse effect on our revenues as well as involve us in possible legal proceedings.

Given these risks, there is considerable uncertainty regarding the success of our current and future collaborative efforts. If these efforts fail, our product development or commercialization of new products could be delayed or revenues from products could decline.

Our business may be adversely affected if we do not successfully execute our growth initiatives.

~~We are experiencing a period of slower revenue growth compared to recent years.~~ We anticipate growth through internal development projects, commercial initiatives and external opportunities, which may include the acquisition, partnering and in-licensing of products, technologies and companies or the entry into strategic alliances and collaborations. While we believe we have a number of promising programs in our pipeline, failure of internal development projects to advance or difficulties in executing on our commercial initiatives could impact our current and future growth, resulting in additional reliance on external development opportunities for growth. The availability of high quality, cost-effective development opportunities is limited and competitive, and we are not certain that we will be able to identify candidates that we and our shareholders consider suitable or complete transactions on terms that are acceptable to us and our shareholders. We may fail to complete transactions for other reasons, including if we are unable to obtain desired financing on favorable terms, if at all. Even if we are able to successfully identify and complete acquisitions and other strategic alliances and collaborations, we may face unanticipated costs or liabilities in connection with the transaction or we may not be able to integrate them or take full advantage of them or otherwise realize the benefits that we expect.

Supporting our growth initiatives and the further development of our existing products and potential new products in our pipeline ~~requires~~will require significant capital expenditures and management resources, including investments in research and development, sales and marketing, manufacturing capabilities and other areas of our business. If we do not successfully execute our growth initiatives, then our business and financial results may be adversely affected and we may incur asset impairment or restructuring charges.

~~The proposed spin off~~We are pursuing opportunities to expand our manufacturing capacity for future clinical and commercial requirements for product candidates, which will result in the incurrence of ~~our hemophilia business is subject to various risks and uncertainties and may not be completed on the terms or timeline currently contemplated, if at all, and will involve~~ significant ~~time and expense, which could harm our business, results of operations and financial condition.~~

In May 2016, we announced plans to separate our hemophilia business as an independent, publicly-traded company. The transaction is expected to be completed in early 2017, subject to satisfaction of certain conditions. Unanticipated developments could delay, prevent or otherwise adversely affect this proposed spin off, including but not limited to disruptions in general market conditions or potential problems, delays or difficulties in satisfying conditions and obtaining approvals and clearances or litigation or other legal proceedings that may arise as a result of the proposed spin off. In addition, consummation of the spin off will require final approval from our Board of Directors. Therefore, we cannot assure that we will be able to complete the spin off on the terms or on the timeline that we announced, if at all.

~~We will incur significant expenses in connection~~investment with the spin off, and such costs and expenses may be greater than we anticipate. In addition, completion of the spin off will require a significant amount of management time and effort which may disrupt our business or otherwise divert management’s attention from other aspects of our business operations. Any such difficulties could adversely affect our business, results of operations and financial condition.

~~The proposed spin off may not achieve some or all of the anticipated benefits.~~

~~If the spin off is completed, there is uncertainty as to whether the anticipated operational, financial and strategic benefits of the spin off will be achieved. There can be~~ no assurance that ~~the combined value of the common stock of the two publicly-traded companies~~such investment will be ~~equal~~recouped.

While we believe we currently have sufficient large scale manufacturing capacity to ~~or greater than what the value of~~meet our ~~common stock~~near-term manufacturing requirements, it is probable that we would ~~have been had the proposed separation not occurred. The combined value of the common stock of the two companies could be lower than anticipated~~need additional large scale manufacturing capacity to support future clinical and commercial manufacturing requirements for product candidates in our pipeline, if such candidates are successful and approved. We are building a ~~variety of reasons, including, but not limited~~large scale biologics manufacturing facility in Solothurn, Switzerland. Due to the ~~inability~~long lead times necessary for the expansion of ~~the new spin off company~~manufacturing capacity, we expect to ~~operate and compete effectively as an independent company, and the stock price of the common stock of each of the two companies could experience periods of volatility.~~make significant investments to build or obtain third-party contract manufacturers with no assurance that such investment will be recouped. If we ~~fail~~are unable to ~~achieve the anticipated benefits of the spin off,~~adequately and timely manufacture and supply our ~~stock price could decline.~~

~~If the spin off does not qualify as a transaction that is generally tax-free for U.S. federal income tax purposes, we~~products and ~~our stockholders could be subject to significant tax liabilities.~~

We intend to obtain an opinion of outside counsel regarding the qualification of the distribution in the spin off, together with certain related transactions, as a transaction that is generally tax-free for U.S. federal income tax purposes. The opinion will be based on and rely on, among other things, certain facts and assumptions, as well as certain representations, statements and undertakings of Biogen and the new spin off company, including those relating to the past and future conduct of Biogen and the new spin off company. If any of these facts, assumptions, representations, statements or undertakings are, or become, inaccurate or incomplete,product candidates or if we ~~or the new spin off company breach any of their respective covenants in the separation documents, the opinion of counsel~~do not fully utilize our manufacturing facilities, our business may be invalid and the conclusions reached therein could be jeopardized. It is also possible that the U.S. Internal Revenue Service, or the IRS, could determine that the distribution in the spin off, together with certain related transactions, is taxable for U.S. federal income tax purposes if it determines that any of these facts, assumptions, representations, statements or undertakings are incorrect or have been violated or if it disagrees with the conclusions in the opinion of counsel. An opinion of counsel is not binding on the IRS or any court and there can be no assurance that the IRS will not challenge the conclusions reached in the opinion. If the distribution in the spin off, together with certain related transactions, is ultimately determined to be taxable, we and our stockholders that are subject to U.S. federal income tax could incur significant tax liabilities.harmed.

A breakdown or breach of our technology systems could subject us to liability or interrupt the operation of our business.

We are increasingly dependent upon technology systems and data. Our computer systems continue to increase in multitude and complexity due to the growth in our business, making them potentially vulnerable to breakdown, malicious intrusion and random attack. Likewise, data privacy or security breaches by individuals authorized to

access our technology systems or others may pose a risk that sensitive data, including intellectual property, trade secrets or personal information belonging to us, our patients, customers or other business partners, may be exposed to unauthorized persons or to the public. Cyber-attacks are increasing in their frequency, sophistication and intensity, and are becoming increasingly difficult to detect. They are often carried out by motivated, well-resourced, skilled and persistent actors including nation states, organized crime groups, “hacktivists" and ~~“hacktivists.”~~employees or contractors acting with malicious intent. Cyber-attacks could include the deployment of harmful malware and key loggers, ransomware, a denial-of-service attack, a malicious website, the use of social engineering and other means to affect the confidentiality, integrity and availability of our technology systems and data. Our key business partners face similar risks and any security breach of their systems could adversely affect our security posture. While we continue to build and improve our systems and infrastructure and believe we have taken appropriate security measures to reduce these risks to our data and information technology systems, there can be no assurance that our efforts will prevent breakdowns or breaches in our systems that could adversely affect our business and operations and/or result in the loss of critical or sensitive information, which could result in financial, legal, business or reputational harm to us. In addition, our liability insurance may not be sufficient in type or amount to cover us against claims related to security breaches, cyber-attacks and other related breaches.

If we fail to comply with the extensive legal and regulatory requirements affecting the health care industry, we could face increased costs, penalties and a loss of business.

Our activities, and the activities of our collaborators, distributors and other third-party providers, are subject to extensive government regulation and oversight both in the U.S. and in foreign jurisdictions. The FDA and comparable agencies in other jurisdictions directly regulate many of our most critical business activities, including the conduct of preclinical and clinical studies, product manufacturing, advertising and promotion, product distribution, adverse event reporting and product risk management. Our interactions in the U.S. or abroad with physicians and other health care providers that prescribe or purchase our products are also subject to government regulation designed to prevent fraud and abuse in the sale and use of the products and place significant restrictions on the marketing practices of health care companies. Health care companies such as ours are facing heightened scrutiny of their relationships

with health care providers from anti-corruption enforcement officials. In addition, health care companies such as ours have been the target of lawsuits and investigations alleging violations of government regulation, including claims asserting submission of incorrect pricing information, impermissible off-label promotion of pharmaceutical products, payments intended to influence the referral of health care business, submission of false claims for government reimbursement, antitrust violations or violations related to environmental matters. There is also enhanced scrutiny of company-sponsored patient assistance programs, including insurance premium and co-pay assistance programs and donations to ~~third party~~third-party charities that provide such assistance. If we or our vendors or donation recipients are deemed to fail to comply with relevant laws, regulations or government guidance in the operation of these programs, we could be subject to significant fines or penalties. Risks relating to compliance with laws and regulations may be heightened as we continue to expand our global operations and enter new therapeutic areas with different patient populations, which may have different product distribution methods, marketing programs or patient assistance programs from those we currently utilize or support.

Regulations governing the health care industry are subject to change, with possibly retroactive effect, including:

new laws, regulations or judicial decisions, or new interpretations of existing laws, regulations or decisions, related to health care availability, pricing or marketing practices, compliance with wage and hour laws and other employment practices, method of delivery, payment for health care products and services, compliance with health information and data privacy and security laws and regulations, tracking and reporting payments and other transfers of value made to physicians and teaching hospitals, extensive anti-bribery and anti-corruption prohibitions, product serialization and labeling requirements and used product take-back requirements;

changes in the FDA and foreign regulatory approval processes that may delay or prevent the approval of new products and result in lost market opportunity;

the hiring freeze implemented by the federal government in 2017, including at the FDA, could impact the review and potential approval of new products, which may adversely affect our business and financial condition;

requirements that provide for increased transparency of clinical trial results and quality data, such as the ~~EMA’s~~European Medicines Agency's clinical transparency policy, which could impact our ability to protect trade secrets and competitively-sensitive information contained in approval applications or could be misinterpreted leading to reputational damage, misperception or legal action, which could harm our business; and

changes in FDA and foreign regulations that may require additional safety monitoring, labeling changes, restrictions on product distribution or use, or other measures after the introduction of our products to market, which could increase our costs of doing business, adversely affect the future permitted uses of approved products or otherwise adversely affect the market for our products.

Violations of governmental regulation may be punishable by criminal and civil sanctions against us, including fines and civil monetary penalties and exclusion from participation in government programs, including Medicare and Medicaid, as well as against executives overseeing our business. In addition to penalties for violation of laws and regulations, we could be required to repay amounts we received from government payors, or pay additional rebates and interest if we are found to have miscalculated the pricing information we have submitted to the government. We cannot ensure that our compliance controls, policies and procedures will in every instance protect us from acts committed by our employees, collaborators, partners or third-party providers that would violate the laws or regulations of the jurisdictions in which we operate. Whether or not we have complied with the law, an investigation into alleged unlawful conduct could increase our expenses, damage our reputation, divert management time and attention and adversely affect our business.

~~Our indebtedness could adversely affect our business and limit our ability to plan for or respond to changes in our business.~~

Our indebtedness, together with our significant contingent liabilities, including milestone and royalty payment obligations, could have important consequences to our business; for example, such obligations could:

~~increase our vulnerability to general adverse economic and industry conditions;~~

~~limit our ability to access capital markets and incur additional debt in the future;~~

require us to dedicate a substantial portion of our cash flow from operations to payments on our indebtedness, thereby reducing the availability of our cash flow for other purposes, including business development efforts, research and development and mergers and acquisitions; and

limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we operate, thereby placing us at a competitive disadvantage compared to our competitors that have less debt.

~~Our sales and operations are subject to the risks of doing business internationally.~~

~~We are increasing our presence in international markets, particularly emerging markets, subjecting us to many risks that could adversely affect our business and revenues, such as:~~

~~the inability to obtain necessary foreign regulatory or pricing approvals of products in a timely manner;~~

~~collectability of accounts receivable;~~

~~fluctuations in foreign currency exchange rates, in particular the recent strength of the U.S. dollar versus foreign currencies which has adversely impacted our revenues and net income;~~

~~difficulties in staffing and managing international operations;~~

~~the imposition of governmental controls;~~

~~less favorable intellectual property or other applicable laws;~~

~~increasingly complex standards for complying with foreign laws and regulations that may differ substantially from country to country and may conflict with corresponding U.S. laws and regulations;~~

~~the far-reaching anti-bribery and anti-corruption legislation in the U.K., including the U.K. Bribery Act 2010, and elsewhere and escalation of investigations and prosecutions pursuant to such laws;~~

~~compliance with complex import and export control laws;~~

~~restrictions on direct investments by foreign entities and trade restrictions;~~

~~greater political or economic instability; and~~

~~changes in tax laws and tariffs.~~

In addition, our international operations are subject to regulation under U.S. law. For example, the Foreign Corrupt Practices Act prohibits U.S. companies and their representatives from offering, promising, authorizing or making payments to foreign officials for the purpose of obtaining or retaining business abroad. In many countries, the health care professionals we regularly interact with may meet the definition of a foreign government official for purposes of the Foreign Corrupt Practices Act. Failure to comply with domestic or foreign laws could result in various adverse consequences, including: possible delay in approval or refusal to approve a product; recalls, seizures or withdrawal of an approved product from the market; disruption in the supply or availability of our products or suspension of export or import privileges; the imposition of civil or criminal sanctions; the prosecution of executives overseeing our international operations; and damage to our reputation. Any significant impairment of our ability to sell products outside of the U.S. could adversely impact our business and financial results.

Our effective tax rate may fluctuate and we may incur obligations in tax jurisdictions in excess of accrued amounts.

As a global biopharmaceutical company, we are subject to taxation in numerous countries, states and other jurisdictions. As a result, our effective tax rate is derived from a combination of applicable tax rates in the various places that we operate. In preparing our financial statements, we estimate the amount of tax that will become payable in each of such places. Our effective tax rate, however, may be different than experienced in the past due to numerous factors, including changes in the mix of our profitability from country to country, the results of examinations and audits of our tax filings, adjustments to the value of our uncertain tax positions, changes in accounting for income taxes and changes in tax laws. Any of these factors could cause us to experience an effective tax rate significantly different from previous periods or our current expectations.

In addition, our inability to secure or sustain acceptable arrangements with tax authorities and future changes in the tax laws, among other things, may result in tax obligations in excess of amounts accrued in our financial statements.

In the U.S., there are several proposals under consideration to reform tax law, including proposals that may reduce or eliminate the deferral of U.S. income tax on our unrepatriated earnings, penalize certain transfer pricing structures and reduce or eliminate certain foreign or domestic tax credits or deductions. Our future reported financial results may be adversely affected by tax law changes which restrict or eliminate certain foreign tax credits or our ability to deduct expenses attributable to foreign earnings, or otherwise affect the treatment of our unrepatriated earnings.

In addition to U.S. tax reform proposals, the adoption of some or all of the recommendations set forth in the Organization for Economic Co-operation and Development’s project on “Base Erosion and Profit Shifting” ~~(BEPS)~~ by tax authorities in the countries in which we operate could negatively impact our effective tax rate. These recommendations focus on payments from affiliates in high tax jurisdictions to affiliates in lower tax jurisdictions and the activities that give rise to a taxable presence in a particular country.

Our indebtedness could adversely affect our business and limit our ability to plan for or respond to changes in our business.

increase our vulnerability to general adverse economic and industry conditions;

limit our ability to access capital markets and incur additional debt in the future;

Our sales and operations are subject to the risks of doing business internationally.

We are increasing our presence in international markets, particularly emerging markets, subjecting us to many risks that could adversely affect our business and revenues, such as:

the inability to obtain necessary foreign regulatory or pricing approvals of products in a timely manner;

uncertainties regarding the collectability of accounts receivable;

fluctuations in foreign currency exchange rates, in particular the recent strength of the U.S. dollar versus foreign currencies, which has adversely impacted our revenues and net income;

difficulties in staffing and managing international operations;

the imposition of governmental controls;

less favorable intellectual property or other applicable laws;

increasingly complex standards for complying with foreign laws and regulations that may differ substantially from country to country and may conflict with corresponding U.S. laws and regulations;

the far-reaching anti-bribery and anti-corruption legislation in the U.K., including the U.K. Bribery Act 2010, and elsewhere and escalation of investigations and prosecutions pursuant to such laws;

the effects of the implementation of the U.K.'s decision to voluntarily depart from the E.U., known as Brexit;

compliance with complex import and export control laws;

restrictions on direct investments by foreign entities and trade restrictions;

greater political or economic instability; and

changes in tax laws and tariffs.

Our operating results are subject to significant fluctuations.

Our quarterly revenues, expenses and net income (loss) have fluctuated in the past and are likely to fluctuate significantly in the future due to the risks described in these “Risk Factors” as well as the timing of charges and expenses that we may take. We have recorded, or may be required to record, charges that include:

the cost of restructurings;

impairments with respect to investments, fixed assets and long-lived assets, including in-process R&D and other intangible assets;

inventory write-downs for failed quality specifications, charges for excess or obsolete inventory and charges for inventory write downs relating to product suspensions, expirations or recalls;

changes in the fair value of contingent consideration;

bad debt expenses and increased bad debt reserves;

outcomes of litigation and other legal or administrative proceedings, regulatory matters and tax matters;

milestone payments under license and collaboration agreements; and

payments in connection with acquisitions and other business development activities.

Our revenues are also subject to foreign currency exchange rate fluctuations due to the global nature of our operations. Although we have foreign currency forward contracts to hedge specific forecasted transactions denominated in foreign currencies, our efforts to mitigate the impact of fluctuating currency exchange rates may not be successful. As a result, currency fluctuations among our reporting currency, the U.S. dollar and the currencies in which we do business will affect our operating results, often in unpredictable ways. Our net income may also fluctuate due to the impact of charges we may be required to take with respect to foreign currency hedge transactions. In particular, we may incur higher than expected charges from hedge ineffectiveness or from the termination of a hedge relationship.

Our operating results during any one period do not necessarily suggest the anticipated results of future periods.

We are pursuing opportunities to expand our manufacturing capacity for future clinical and commercial requirements for product candidates, which will result in the incurrence of significant investment with no assurance that such investment will be recouped.

While we believe we currently have sufficient manufacturing capacity to meet our near-term manufacturing requirements, it is probable that we would need additional manufacturing capacity to support future clinical and commercial manufacturing requirements for product candidates in our pipeline, if such candidates are successful and approved. We are building a biologics manufacturing facility in Solothurn, Switzerland and acquired an additional manufacturing facility in RTP, NC. Due to the long lead times necessary for the expansion of manufacturing capacity, we expect to incur significant investment to build or expand our facilities or obtain third-party contract manufacturers with no assurance that such investment will be recouped. If we are unable to adequately and timely manufacture and supply our products and product candidates or if we do not fully utilize our manufacturing facilities, our business may be harmed.

Our investment in Samsung Bioepis, and our success in commercializing biosimilars developed by Samsung Bioepis, ~~are~~is subject to risks and uncertainties inherent in the development, manufacture and commercialization of biosimilars.

Our investment in Samsung Bioepis, and our success in commercializing biosimilars developed by Samsung Bioepis, ~~are~~is subject to a number of risks, including:

Reliance on Third Parties. We are dependent on the efforts of Samsung Bioepis and other third parties over whom we have limited or no control in the development and manufacturing of biosimilars products. If Samsung Bioepis or such other third parties fail to perform successfully, we may not realize the anticipated benefits of our investment in Samsung Bioepis;

Regulatory Compliance. Biosimilar products may face regulatory hurdles or delays due to the evolving and uncertain regulatory and commercial pathway of biosimilars products in certain jurisdictions;

Intellectual Property and Regulatory Challenges. Biosimilar products may face extensive patent clearances, patent infringement litigation, injunctions or regulatory challenges, which could prevent the commercial launch of a product or delay it for many years;

Failure to Gain Market and Patient Acceptance. Market success of biosimilar products will be adversely affected if patients, physicians ~~and~~and/or payers do not accept biosimilar products as safe and efficacious products offering a more competitive price or other benefit over existing therapies;

Ability to Provide Adequate Supply. Manufacturing biosimilars is complex. If we encounter any manufacturing or supply chain difficulties, we may be unable to meet higher than anticipated demand; and

Competitive Challenges. Biosimilar products face significant competition, including from innovator products and from biosimilar products offered by other companies. In some jurisdictions, local tendering processes may restrict biosimilar products from being marketed and sold in those jurisdictions. The number of competitors in a jurisdiction, the timing of approval and the ability to market biosimilar products successfully in a timely and cost-effective matter are additional factors that may impact our success and/or the success of Samsung Bioepis in this business area.

Our investments in properties may not be fully realized.

We own or lease real estate primarily consisting of buildings that contain research laboratories, office space and manufacturing operations. For strategic or other operational reasons, we may decide to further consolidate or co-locate certain aspects of our business operations or dispose of one or more of our properties, some of which may be located in markets that are experiencing high vacancy rates and decreasing property values. If we determine that the fair value of any of our owned properties is lower than their book value we may not realize the full investment in these properties and incur significant impairment charges or additional depreciation when the expected useful ~~life~~lives of certain assets have been shortened due to the anticipated closing of facilities. If we decide to fully or partially vacate a leased property, we may incur significant cost, including facility closing costs, employee separation and retention expenses, lease termination fees, rent expense in excess of sublease income and impairment of leasehold improvements and accelerated depreciation of assets. Any of these events may have an adverse impact on our results of operations.

Our portfolio of marketable securities is subject to market, interest and credit risk that may reduce its value.

We maintain a portfolio of marketable securities for investment of our cash. Changes in the value of our portfolio of marketable securities could adversely affect our earnings. In particular, the value of our investments may decline due to increases in interest rates, downgrades of the bonds and other securities included in our portfolio, instability in the global financial markets that reduces the liquidity of securities included in our portfolio, declines in the value of collateral underlying the securities included in our portfolio and other factors. Each of these events may cause us to record charges to reduce the carrying value of our investment portfolio or sell investments for less than our acquisition cost. Although we attempt to mitigate these risks through diversification of our investments and continuous monitoring of our portfolio's overall risk profile, the value of our investments may nevertheless decline.

There can be no assurance that we will continue to repurchase stock or that we will repurchase stock at favorable prices.

~~Our~~From time to time our Board of Directors ~~has approved~~authorizes stock repurchase programs, ~~and may approve additional repurchase programs in the future.~~including most recently our 2016 Share Repurchase Program. The amount and timing of stock repurchases are subject to capital availability and our determination that stock repurchases are in the best interest of our ~~stockholders~~shareholders and are in compliance with all respective laws and our agreements applicable to the repurchase of stock. Our ability to repurchase stock will depend upon, among other factors, our cash balances and potential future capital requirements for strategic transactions, our results of operations, our financial condition and other factors beyond our control that we may deem relevant. A reduction in, or the completion or expiration of, our stock repurchase programs could have a negative effect on our stock price. We can provide no assurance that we will repurchase stock at favorable prices, if at all.

We may not be able to access the capital and credit markets on terms that are favorable to us.

We may seek access to the capital markets to supplement our existing funds and cash generated from operations for working capital, capital expenditure and debt service requirements and other business initiatives. The capital and credit markets have experienced extreme volatility and disruption, which leads to uncertainty and liquidity issues for both borrowers and investors. In the event of adverse capital and credit market conditions, we may be unable to obtain capital market financing on favorable terms. Changes in credit ratings issued by nationally recognized credit rating agencies could also adversely affect our cost of financing and the market price of our securities.

We may incur operational difficulties or be exposed to claims and liabilities as a result of the separation and distribution of Bioverativ.

On February 1, 2017, we distributed all of the then outstanding shares of Bioverativ common stock to Biogen shareholders in connection with the separation of our hemophilia business. In connection with the distribution, we entered into a separation and distribution agreement and various other agreements (including a transition services agreement, a tax matters agreement, a manufacturing and supply agreement, an employee matters agreement, an intellectual property matters agreement and certain other commercial agreements). These agreements govern the separation and distribution and the relationship between us and Bioverativ going forward, including with respect to potential tax-related losses associated with the separation and distribution. They also provide for the performance of services by each company for the benefit of the other for a period of time (including under the manufacturing and supply agreement pursuant to which we will manufacture and supply certain products and materials to Bioverativ).

The spin-off of our hemophilia business as an independent public company is intended to qualify for tax-free treatment to Biogen and its shareholders under the Internal Revenue Code. Completion of the spin-off was conditioned upon, among other things, our receipt of a favorable opinion from our tax advisors with respect to the tax-free nature of the transaction. The opinion is not binding on the U.S. Internal Revenue Service, or the courts, and there can be no assurance that the IRS or the courts will not challenge the qualification of the spin-off as a tax-free transaction or that any such challenge would not prevail. If the spin-off is determined to be taxable, Biogen and its shareholders could incur significant tax liabilities, which could adversely affect our business, financial condition, or results of operations.

Bioverativ has agreed to indemnify us for certain potential liabilities that may arise, but we cannot guarantee that Bioverativ will be able to satisfy its indemnification obligations.

The separation and distribution agreement provides for indemnification obligations designed to make Bioverativ financially responsible for many liabilities that may exist relating to its business activities, whether incurred prior to or after the distribution, including any pending or future litigation. It is possible that a court would disregard the

allocation agreed to between us and Bioverativ and require us to assume responsibility for obligations allocated to Bioverativ. Third parties could also seek to hold us responsible for any of these liabilities or obligations, and the indemnity rights we have under the separation and distribution agreement may not be sufficient to fully cover all of these liabilities and obligations. Even if we are successful in obtaining indemnification, we may have to bear costs temporarily. In addition, our indemnity obligations to Bioverativ may be significant. These risks could negatively affect our business, financial condition or results of operations.

The separation of Bioverativ continues to involve a number of risks, including, among other things, the indemnification risks described above and the potential that management’s and our employees’ attention will be significantly diverted by the provision of transitional services. Certain of the agreements described above provide for the performance of services by each company for the benefit of the other for a period of time. If Bioverativ is unable to satisfy its obligations under these agreements, including its indemnification obligations, we could incur losses. These arrangements could also lead to disputes over rights to certain shared property and over the allocation of costs and revenues for products and operations. Our inability to effectively manage the separation activities and related events could adversely affect our business, financial condition or results of operations.

We may not achieve some or all of the anticipated benefits of the separation of Bioverativ, which may adversely affect our business.

We may not be able to achieve the full strategic and financial benefits expected to result from the separation of Bioverativ, or such benefits may be delayed or not occur at all. If we fail to achieve some or all of the expected benefits of the separation, or if such benefits are delayed, our business, financial condition, results of operations and the value of our stock could be adversely impacted.

Our business involves environmental risks, which include the cost of compliance and the risk of contamination or injury.

Our business and the business of several of our strategic partners involve the controlled use of hazardous materials, chemicals, biologics and radioactive compounds. Although we believe that our safety procedures for handling and disposing of such materials comply with state, federal and foreign standards, there will always be the risk of accidental contamination or injury. If we were to become liable for an accident, or if we were to suffer an extended facility shutdown, we could incur significant costs, damages and penalties that could harm our business. Manufacturing of our products and product candidates also requires permits from government agencies for water supply and wastewater discharge. If we do not obtain appropriate permits, including permits for sufficient quantities of water and wastewater, we could incur significant costs and limits on our manufacturing volumes that could harm our business.

The illegal distribution and sale by third parties of counterfeit versions of our products or stolen products could have a negative impact on our reputation and business.

Third parties might illegally distribute and sell counterfeit or unfit versions of our products, which do not meet our rigorous manufacturing, distribution and testing standards. A patient who receives a counterfeit or unfit drug may be at risk for a number of dangerous health consequences. Our reputation and business could suffer harm as a result of counterfeit or unfit drugs sold under our brand name. Stolen inventory that is not properly stored or sold through unauthorized channels could adversely impact patient safety, our reputation and our business. In addition, ~~thefts of~~ inventory atthat is stolen from warehouses, plants or while in-transit, ~~which are not properly~~and that is subsequently improperly stored and ~~which are~~ sold through unauthorized channels, could adversely impact patient safety, our reputation and our business.

The increasing use of social media platforms presents new risks and challenges.

Social media is increasingly being used to communicate about our products and the diseases our therapies are designed to treat. Social media practices in the biopharmaceutical industry continue to evolve and regulations relating to such use are not always clear. This evolution creates uncertainty and risk of noncompliance with regulations applicable to our business. For example, patients may use social media channels to comment on the effectiveness of a product or to report an alleged adverse event. When such disclosures occur, there is a risk that we fail to monitor and comply with applicable adverse event reporting obligations or we may not be able to defend the company or the public's legitimate interests in the face of the political and market pressures generated by social media due to restrictions on what we may say about our products. There is also a risk of inappropriate disclosure of sensitive information or negative or inaccurate posts or comments about us on any social networking website. If any of these events were to occur or we otherwise fail to comply with applicable regulations, we could incur liability, face overly restrictive regulatory actions or incur other harm to our business.

Some of our collaboration agreements contain change in control provisions that may discourage a third party from attempting to acquire us.

Some of our collaboration agreements include change in control provisions that could reduce the potential acquisition price an acquirer is willing to pay or discourage a takeover attempt that could be viewed as beneficial to shareholders. Upon a change in control, some of these provisions could trigger reduced milestone, profit or royalty payments to us or give our collaboration partner rights to terminate our collaboration agreement, acquire operational control or force the purchase or sale of the programs that are the subject of the collaboration.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

Issuer Purchases of Equity Securities

The following table summarizes our common stock repurchase activity under our 2016 Share Repurchase Program during the second quarter of 2017:



Period	Total Number of Shares Purchased (#)	Average Price Paid per Share ($)		Total Number of Shares Purchased as Part of Publicly Announced Programs (#)	Maximum Approximate Dollar Value of Shares That May Yet Be Purchased Under Our Programs ($ in millions)
April 2017	2,300,000	$	272.03	2,300,000	$	3,156.0
May 2017	571,804	$	273.03	571,804	$	3,000.0
June 2017	—	—		—	$	—
Total	2,871,804	$	272.23

In July 2016 our Board of Directors authorized a program to repurchase up to $5.0 billion of our common stock (2016 Share Repurchase Program). This authorization does not have an expiration date. ~~Repurchased shares~~All share repurchases under this authorization will be retired. ~~The 2016 Share Repurchase Program is in addition to the approximately 1.3~~Under this program, we repurchased and retired 2.9 million and 3.7 million shares ~~remaining under our February 2011 Share Repurchase Program (2011 Share Repurchase Program), which has been used principally to offset~~of common stock ~~issuances under our share-based compensation plans. During~~at a cost of $781.8 million and $1.0 billion during the three and six months ended June 30, ~~2016 and 2015, we did not~~2017, respectively. As of June 30, 2017, approximately $3.0 billion remains available to repurchase ~~any~~ shares ~~of common stock~~ under ~~our 2011 Share Repurchase Program.~~this authorization.

In ~~May 2015,~~February 2011 our Board of Directors authorized a program to repurchase up to ~~$5.0 billion~~20.0 million shares of ~~our~~ common stock, which was completed as of ~~December~~March 31, ~~2015.~~2017. During the six months ended June 30, ~~2015,~~2017, we repurchased ~~and retired 0.1~~1.3 million shares of common stock at a cost of ~~$42.2 million.~~$365.4 million under this program. During the three and six months ended June 30, 2016, we did not repurchase any shares of common stock under this program.

Item 6. Exhibits

The exhibits listed on the Exhibit Index immediately preceding such exhibits, which is incorporated herein by reference, are filed or furnished as part of this Quarterly Report on Form 10-Q.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

BIOGEN INC.

/s/ ~~Paul J. Clancy~~Gregory F. Covino

~~Paul J. Clancy~~Gregory F. Covino

~~Executive~~ Vice President, Finance

Chief Accounting Officer and

~~Chief~~Interim Principal Financial Officer

~~(principal~~ (principal financial officer)

July ~~21, 2016~~25, 2017

EXHIBIT INDEX



Exhibit Number		Description of Exhibit

3.1		Fourth Amended and Restated Bylaws of Biogen Inc. Filed as Exhibit 3.1 to our Current Report on Form 8-K filed on June 9, 2017.

10.1*		Biogen Inc. 2017 Omnibus Equity Plan. Filed as Appendix B to our Definitive Proxy Statement on Schedule 14A filed on April 26, 2017.

10.2*+		~~Letter regarding employment arrangement~~Form of ~~John Cox dated May 19, 2016.~~restricted stock unit award agreement under the Biogen Inc. 2017 Omnibus Equity Plan.

10.3*+		Form of market stock unit award agreement under the Biogen Inc. 2017 Omnibus Equity Plan.

10.4*+		Form of performance unit award agreement under the Biogen Inc. 2017 Omnibus Equity Plan.

10.5*+		Form of performance unit award agreement under the Biogen Inc. 2017 Omnibus Equity Plan.

31.1+		Certification of the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2+		Certification of the ~~Chief~~Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1++		Certification Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101++		The following materials from Biogen Inc.’s Quarterly Report on Form 10-Q for the quarter ended June 30, ~~2016,~~2017, formatted in XBRL (Extensible Business Reporting Language): (i) the Condensed Consolidated Statements of Income, (ii) the Condensed Consolidated Statements of Comprehensive Income, (iii) the Condensed Consolidated Balance Sheets, (iv) the Condensed Consolidated Statements of Cash Flows, and (v) Notes to Condensed Consolidated Financial Statements.

* Management contract or compensatory plan or arrangement

+ Filed herewith

++ Furnished herewith



Delaware		33-0112644
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)



Large accelerated filer x		Accelerated filer o
Non-accelerated filer o		Smaller reporting company o
(Do not check if a smaller reporting company)		Emerging growth companyo



		Page
PART I — FINANCIAL INFORMATION

Item 1.	Financial Statements (unaudited)

	Condensed Consolidated Statements of Income — For the Three and Six Months Ended June 30, ~~2016~~2017 and ~~2015~~2016	5

	Condensed Consolidated Statements of Comprehensive Income — For the Three and Six Months Ended June 30, ~~2016~~2017 and ~~2015~~2016	6

	Condensed Consolidated Balance Sheets — As of June 30, ~~2016~~2017 and December 31, ~~2015~~2016	7

	Condensed Consolidated Statements of Cash Flows — For the Six Months Ended June 30, ~~2016~~2017 and ~~2015~~2016	8

	Notes to Condensed Consolidated Financial Statements	9
	~~Certain totals may not sum due to rounding.~~

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	35

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	5857

Item 4.	Controls and Procedures	6059

PART II — OTHER INFORMATION

Item 1.	Legal Proceedings	6160

Item 1A.	Risk Factors	6160

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	74

Item 6.	Exhibits	74

Signatures		75


	For the Three Months Ended June 30,						For the Six Months Ended June 30,						For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2016			2015			2016			2015			2017			2016			2017			2016
Revenues:
Product, net	$	2,466.0		$	2,198.6		$	4,775.4		$	4,370.9		$	2,639.7		$	2,466.0		$	5,019.8		$	4,775.4
Revenues from anti-CD20 therapeutic programs	349.2			337.5			678.7			668.1			397.1			349.2			737.7			678.7
Other	79.0			55.6			166.9			107.6			41.6			79.0			131.6			166.9
Total revenues	2,894.2			2,591.6			5,621.0			5,146.6			3,078.4			2,894.2			5,889.1			5,621.0
Cost and expenses:
Cost of sales, excluding amortization of acquired intangible assets	370.3			286.1			683.3			598.6			366.2			370.3			750.8			683.3
Research and development	473.1			490.7			910.4			951.3			796.2			473.1			1,219.6			910.4
Selling, general and administrative	492.4			491.9			989.7			1,052.3			430.2			492.4			929.3			989.7
Amortization of acquired intangible assets	92.9			92.0			181.7			187.9			117.5			92.9			566.0			181.7
Acquired in-process research and development													120.0			—			120.0			—
Collaboration profit (loss) sharing													26.5			(5.6		)	47.3			(5.6		)
(Gain) loss on fair value remeasurement of contingent consideration	10.6			(2.2		)	12.9			5.6			21.2			10.6			31.2			12.9
Restructuring charges	—			—			9.7			—			—			—			—			9.7
Collaboration profit (loss) sharing	(5.6		)	—			(5.6		)	—
Total cost and expenses	1,433.7			1,358.5			2,782.1			2,795.6			1,877.8			1,433.7			3,664.2			2,782.1
Income from operations	1,460.5			1,233.1			2,838.9			2,351.0			1,200.6			1,460.5			2,224.9			2,838.9
Other income (expense), net	(58.5		)	(10.9		)	(111.3		)	(25.9		)	(68.2		)	(58.5		)	(105.8		)	(111.3		)
Income before income tax expense and equity in loss of investee, net of tax	1,402.0			1,222.2			2,727.6			2,325.1			1,132.4			1,402.0			2,119.1			2,727.6
Income tax expense	353.6			292.5			710.0			574.4			269.6			353.6			508.8			710.0
Equity in loss of investee, net of tax	—			4.9			—			5.7			—			—			—			—
Net income	1,048.4			924.8			2,017.6			1,745.0			862.8			1,048.4			1,610.3			2,017.6
Net income (loss) attributable to noncontrolling interests, net of tax	(1.4		)	(2.5		)	(3.1		)	(4.8		)	—			(1.4		)	(0.1		)	(3.1		)
Net income attributable to Biogen Inc.	$	1,049.8		$	927.3		$	2,020.7		$	1,749.8		$	862.8		$	1,049.8		$	1,610.4		$	2,020.7
Net income per share:
Basic earnings per share attributable to Biogen Inc.	$	4.79		$	3.94		$	9.23		$	7.44		$	4.07		$	4.79		$	7.53		$	9.23
Diluted earnings per share attributable to Biogen Inc.	$	4.79		$	3.93		$	9.21		$	7.42		$	4.07		$	4.79		$	7.52		$	9.21
Weighted-average shares used in calculating:
Basic earnings per share attributable to Biogen Inc.	219.1			235.3			219.0			235.1			211.9			219.1			213.7			219.0
Diluted earnings per share attributable to Biogen Inc.	219.4			235.7			219.3			235.7			212.2			219.4			214.0			219.3


	For the Three Months Ended June 30,						For the Six Months Ended June 30,						For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2016			2015			2016			2015			2017			2016			2017			2016
Net income attributable to Biogen Inc.	$	1,049.8		$	927.3		$	2,020.7		$	1,749.8		$	862.8		$	1,049.8		$	1,610.4		$	2,020.7
Other comprehensive income:
Unrealized gains (losses) on securities available for sale, net of tax	4.5			(0.2		)	7.0			1.1			7.2			4.5			5.6			7.0
Unrealized gains (losses) on cash flow hedges, net of tax	29.3			(96.2		)	(18.3		)	(8.9		)	(103.0		)	29.3			(126.8		)	(18.3		)
Unrealized gains (losses) on pension benefit obligation	0.7			2.9			0.9			4.1
Unrealized gains (losses) on pension benefit obligation, net of tax													(0.6		)	0.7			(0.5		)	0.9
Currency translation adjustment	(58.0		)	63.0			(48.4		)	(37.8		)	82.8			(58.0		)	102.8			(48.4		)
Total other comprehensive income (loss), net of tax	(23.5		)	(30.5		)	(58.8		)	(41.5		)	(13.6		)	(23.5		)	(18.9		)	(58.8		)
Comprehensive income attributable to Biogen Inc.	1,026.3			896.8			1,961.9			1,708.3			849.2			1,026.3			1,591.5			1,961.9
Comprehensive income (loss) attributable to noncontrolling interests, net of tax	(1.4		)	(2.3		)	(3.1		)	(4.5		)	—			(1.4		)	(0.1		)	(3.1		)
Comprehensive income	$	1,024.9		$	894.5		$	1,958.8		$	1,703.7		$	849.2		$	1,024.9		$	1,591.4		$	1,958.8



x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


	As of June 30, 2016			As of December 31, 2015			As of June 30, 2017			As of December 31, 2016
ASSETS
Current assets:
Cash and cash equivalents	$	1,362.0		$	1,308.0		$	1,169.5		$	2,326.5
Marketable securities	2,434.8			2,120.5			1,723.5			2,568.6
Accounts receivable, net	1,293.0			1,227.0			1,630.2			1,441.6
Due from anti-CD20 therapeutic programs	334.1			314.5			502.9			300.6
Inventory	996.4			893.4			936.5			1,001.6
Other current assets	1,027.4			836.9			1,146.1			1,093.3
Total current assets	7,447.7			6,700.3			7,108.7			8,732.2
Marketable securities	3,477.6			2,760.4			2,632.7			2,829.4
Property, plant and equipment, net	2,301.8			2,187.6			2,827.6			2,501.8
Intangible assets, net	3,967.6			4,085.1			4,051.3			3,808.3
Goodwill	3,167.1			2,663.8			3,870.4			3,669.3
Investments and other assets	1,153.0			1,107.6			1,268.3			1,335.8
Total assets	$	21,514.8		$	19,504.8		$	21,759.0		$	22,876.8
LIABILITIES AND EQUITY
Current liabilities:
Current portion of notes payable and other financing arrangements	$	4.8		$	4.8		$	559.9		$	4.7
Taxes payable	212.8			208.7			52.6			231.9
Accounts payable	225.9			267.4			330.3			279.8
Accrued expenses and other	2,072.7			2,096.8			2,436.9			2,903.5
Total current liabilities	2,516.2			2,577.7			3,379.7			3,419.9
Notes payable and other financing arrangements	6,538.3			6,521.5			5,954.0			6,512.7
Long-term deferred tax liability	105.6			124.9
Deferred tax liability							100.8			93.1
Other long-term liabilities	951.0			905.8			750.9			722.5
Total liabilities	10,111.1			10,129.9			10,185.4			10,748.2
Commitments and contingencies
Equity:
Biogen Inc. shareholders’ equity
Preferred stock, par value $0.001 per share	—			—			—			—
Common stock, par value $0.0005 per share	0.1			0.1			0.1			0.1
Additional paid-in capital	69.1			—			19.3			—
Accumulated other comprehensive loss	(282.8		)	(224.0		)	(338.8		)	(319.9		)
Retained earnings	14,229.1			12,208.4			14,881.7			15,071.6
Treasury stock, at cost	(2,611.7		)	(2,611.7		)	(2,977.1		)	(2,611.7		)
Total Biogen Inc. shareholders’ equity	11,403.8			9,372.8			11,585.2			12,140.1
Noncontrolling interests	(0.1		)	2.1			(11.6		)	(11.5		)
Total equity	11,403.7			9,374.9			11,573.6			12,128.6
Total liabilities and equity	$	21,514.8		$	19,504.8		$	21,759.0		$	22,876.8



(In millions)	Workforce Reduction			Pipeline Programs			Total
Restructuring reserve as of December 31, 2015	$	33.7		$	3.6		$	37.3
Expense	4.9			5.4			10.3
Payments	(28.7		)	(6.0		)	(34.7		)
Adjustments to previous estimates, net	(3.5		)	2.9			(0.6		)
Restructuring reserve as of June 30, 2016	$	6.4		$	5.9		$	12.3



(In millions)	Discounts			Contractual Adjustments			Returns			Total
Balance, as of December 31, 2015	$	56.1		$	548.7		$	57.9		$	662.7
Current provisions relating to sales in current year	266.8			973.8			17.6			1,258.2
Adjustments relating to prior years	(2.4		)	1.6			(5.5		)	(6.3		)
Payments/credits relating to sales in current year	(210.2		)	(605.1		)	(0.7		)	(816.0		)
Payments/credits relating to sales in prior years	(51.5		)	(384.9		)	(10.4		)	(446.8		)
Balance, as of June 30, 2016	$	58.8		$	534.1		$	58.9		$	651.8



(In millions)	As of June 30, 2016		As of December 31, 2015
Reduction of accounts receivable	$	161.3	$	144.6
Component of accrued expenses and other	490.5		518.1
Total reserves	$	651.8	$	662.7



		As of June 30, 2016							As of December 31, 2015
(In millions)	Estimated Life	Cost		Accumulated Amortization			Net		Cost		Accumulated Amortization			Net
Out-licensed patents	13-23 years	$	543.3	$	(514.9	)	$	28.4	$	543.3	$	(506.0	)	$	37.3
Developed technology	15-23 years	3,005.3		(2,604.5		)	400.8		3,005.3		(2,552.9		)	452.4
In-process research and development	Indefinite until commercialization	692.3		—			692.3		730.5		—			730.5
Trademarks and tradenames	Indefinite	64.0		—			64.0		64.0		—			64.0
Acquired and in-licensed rights and patents	6-18 years	3,405.4		(623.3		)	2,782.1		3,303.2		(502.3		)	2,800.9
Total intangible assets		$	7,710.3	$	(3,742.7	)	$	3,967.6	$	7,646.3	$	(3,561.2	)	$	4,085.1



(In millions)
Assets
Cash	$	302.7
Accounts receivable	144.7
Inventory	116.1
Property, plant and equipment, net	20.2
Intangible assets, net	56.8
Goodwill	314.1
Other, net	53.7
Assets transferred, net	$	1,008.3

Liabilities
Accrued expenses and other current liabilities	$	87.8
Other long-term liabilities	67.7
Liabilities transferred, net	$	155.5



(In millions)	As of June 30, 2017		As of December 31, 2016
Reduction of accounts receivable	$	191.0	$	166.9
Component of accrued expenses and other	533.3		438.6
Total reserves	$	724.3	$	605.5



		As of June 30, 2017							As of December 31, 2016
(In millions)	Estimated Life	Cost		Accumulated Amortization			Net		Cost		Accumulated Amortization			Net
Out-licensed patents	13-23 years	$	543.3	$	(529.8	)	$	13.5	$	543.3	$	(523.6	)	$	19.7
Developed technology	15-23 years	3,005.3		(2,662.2		)	343.1		3,005.3		(2,634.3		)	371.0
In-process research and development	Indefinite until commercialization	668.6		—			668.6		648.0		—			648.0
Trademarks and tradenames	Indefinite	64.0		—			64.0		64.0		—			64.0
Acquired and in-licensed rights and patents	4-18 years	3,937.1		(975.0		)	2,962.1		3,481.7		(776.1		)	2,705.6
Total intangible assets		$	8,218.3	$	(4,167.0	)	$	4,051.3	$	7,742.3	$	(3,934.0	)	$	3,808.3


(In millions)	As of June 30, 2016		As of June 30, 2017
2016 (remaining six months)	$	181.6
2017	325.1
2017 (remaining six months)			$	222.6
2018	298.2		425.8
2019	282.7		412.5
2020	277.1		378.6
2021	265.0		239.3
2022			216.7


	As of June 30, 2016				As of December 31, 2015				As of June 30, 2017				As of December 31, 2016
(In millions)	Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value
Notes payable to Fumedica	$	6.4	$	6.1	$	9.4	$	9.0
Notes payable to Fumedica AG									$	3.3	$	3.3	$	6.1	$	6.0
6.875% Senior Notes due March 1, 2018	598.2		561.9		602.6		565.3		569.9		554.8		583.7		558.5
2.900% Senior Notes due September 15, 2020	1,561.7		1,507.9		1,497.5		1,485.5		1,531.5		1,487.4		1,521.5		1,485.3
3.625% Senior Notes due September 15, 2022	1,061.0		992.7		1,014.2		992.2		1,051.8		993.8		1,026.6		993.2
4.050% Senior Notes due September 15, 2025	1,887.3		1,734.1		1,764.6		1,733.4		1,853.3		1,735.6		1,796.0		1,734.8
5.200% Senior Notes due September 15, 2045	1,996.3		1,721.3		1,757.6		1,721.1		1,996.2		1,721.7		1,874.5		1,721.5
Total	$	7,110.9	$	6,524.0	$	6,645.9	$	6,506.5	$	7,006.0	$	6,496.6	$	6,808.4	$	6,499.3


As of June 30, 2016 (In millions)	Fair Value		Gross Unrealized Gains		Gross Unrealized Losses			Amortized Cost
As of June 30, 2017 (In millions)										Fair Value		Gross Unrealized Gains		Gross Unrealized Losses			Amortized Cost
Corporate debt securities
Current	$	913.4	$	0.3	$	(0.2	)	$	913.3	$	988.9	$	0.1	$	(0.5	)	$	989.3
Non-current	1,376.9		7.8		(0.4		)	1,369.5		1,309.0		1.9		(2.5		)	1,309.6
Government securities
Current	1,521.3		0.6		—			1,520.7		732.9		—		(0.9		)	733.8
Non-current	1,452.1		3.1		(0.6		)	1,449.6		834.9		0.4		(3.3		)	837.8
Mortgage and other asset backed securities
Current	0.1		—		—			0.1		1.7		—		—			1.7
Non-current	648.6		1.4		(0.9		)	648.1		488.8		1.1		(1.2		)	488.9
Total marketable debt securities	$	5,912.4	$	13.2	$	(2.1	)	$	5,901.3	$	4,356.2	$	3.5	$	(8.4	)	$	4,361.1
Marketable equity securities, non-current	$	32.4	$	0.9	$	(2.1	)	$	33.6	$	15.2	$	0.1	$	(3.3	)	$	18.4



As of December 31, 2016 (In millions)	Fair Value		Gross Unrealized Gains		Gross Unrealized Losses			Amortized Cost
Corporate debt securities
Current	$	1,408.6	$	0.2	$	(0.6	)	$	1,409.0
Non-current	1,255.2		1.2		(4.7		)	1,258.7
Government securities
Current	1,156.0		0.2		(0.3		)	1,156.1
Non-current	1,016.5		0.5		(3.4		)	1,019.4
Mortgage and other asset backed securities
Current	4.0		—		—			4.0
Non-current	557.7		0.8		(2.2		)	559.1
Total marketable debt securities	$	5,398.0	$	2.9	$	(11.2	)	$	5,406.3
Marketable equity securities, non-current	$	24.9	$	0.7	$	(9.3	)	$	33.5



(In millions)	As of June 30, 2017
Goodwill, beginning of period	$	3,669.3
Elimination of goodwill allocated to our hemophilia business	(314.1		)
Increase to goodwill	508.9
Other	6.3
Goodwill, end of period	$	3,870.4


As of June 30, 2016 (In millions)	Total		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
As of June 30, 2017 (In millions)									Total		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	874.6	$	—	$	874.6	$	—	$	836.0	$	—	$	836.0	$	—
Marketable debt securities:
Corporate debt securities	2,290.3		—		2,290.3		—		2,297.9		—		2,297.9		—
Government securities	2,973.4		—		2,973.4		—		1,567.8		—		1,567.8		—
Mortgage and other asset backed securities	648.7		—		648.7		—		490.5		—		490.5		—
Marketable equity securities	32.4		32.4		—		—		15.2		15.2		—		—
Derivative contracts	30.1		—		30.1		—		4.6		—		4.6		—
Plan assets for deferred compensation	35.6		—		35.6		—		32.9		—		32.9		—
Total	$	6,885.1	$	32.4	$	6,852.7	$	—	$	5,244.9	$	15.2	$	5,229.7	$	—
Liabilities:
Derivative contracts	$	24.8	$	—	$	24.8	$	—	$	70.6	$	—	$	70.6	$	—
Contingent consideration obligations	515.7		—		—		515.7		492.1		—		—		492.1
Total	$	540.5	$	—	$	24.8	$	515.7	$	562.7	$	—	$	70.6	$	492.1



As of December 31, 2015 (In millions)	Total		Quoted Prices in Active Markets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Cash equivalents	$	909.5	$	—	$	909.5	$	—
Marketable debt securities:
Corporate debt securities	1,510.9		—		1,510.9		—
Government securities	2,875.9		—		2,875.9		—
Mortgage and other asset backed securities	494.1		—		494.1		—
Marketable equity securities	37.5		37.5		—		—
Derivative contracts	27.2		—		27.2		—
Plan assets for deferred compensation	40.1		—		40.1		—
Total	$	5,895.2	$	37.5	$	5,857.7	$	—
Liabilities:
Derivative contracts	$	14.7	$	—	$	14.7	$	—
Contingent consideration obligations	506.0		—		—		506.0
Total	$	520.7	$	—	$	14.7	$	506.0


	Notional Amount				Notional Amount
Foreign Currency: (In millions)	As of June 30, 2016		As of December 31, 2015		As of June 30, 2017		As of December 31, 2016
Euro	$	1,126.5	$	945.5	$	1,772.5	$	871.7
Swiss francs	43.5		80.8
British pound					77.4		—
Canadian dollar	39.9		76.7		39.2		—
Swiss franc					32.1		—
Total foreign currency forward contracts	$	1,209.9	$	1,103.0	$	1,921.2	$	871.7



For the Three Months Ended June 30,
Net Gains/(Losses) Reclassified from AOCI into Operating Income (Effective Portion)						Net Gains/(Losses) Recognized into Net Income (Ineffective Portion)
Location	2016			2015		Location	2016		2015
Revenue	$	(4.3	)	$	40.4	Other income (expense)	$	2.1	$	1.2
Operating expenses	$	(0.1	)	$	—	Other income (expense)	$	—	$	—

																										For the Six Months Ended June 30,
Net Gains/(Losses) Reclassified from AOCI into Operating Income (Effective Portion)	Net Gains/(Losses) Reclassified from AOCI into Operating Income (Effective Portion)						Net Gains/(Losses) Recognized into Net Income (Ineffective Portion)						Net Gains/(Losses) Reclassified from AOCI into Operating Income (Effective Portion)						Net Gains/(Losses) Recognized into Net Income (Ineffective Portion)
Location		2016			2015		Location	2016			2015			2017		2016			Location	2017			2016
Revenue		$	4.5		$	75.4	Other income (expense)	$	4.0		$	3.4		$	3.7	$	4.5		Other income (expense)	$	6.0		$	4.0
Operating expenses		$	(0.2	)	$	—	Other income (expense)	$	(0.3	)	$	—		$	0.2	$	(0.2	)	Other income (expense)	$	(0.3	)	$	(0.3	)


		Fair Value			Fair Value
(In millions)	Balance Sheet Location	As of June 30, 2016		Balance Sheet Location	As of June 30, 2017
Hedging Instruments:
Asset derivatives	Other current assets	$	2.0	Other current assets	$	1.9
	Investments and other assets	$	23.6
Liability derivatives	Accrued expenses and other	$	14.8	Accrued expenses and other	$	40.8
	Other long-term liabilities	$	—	Other long-term liabilities	$	29.5
Other Derivatives:
Asset derivatives	Other current assets	$	4.5	Other current assets	$	2.7
Liability derivatives	Accrued expenses and other	$	10.0	Accrued expenses and other	$	0.3

		Fair Value			Fair Value
(In millions)	Balance Sheet Location	As of December 31, 2015		Balance Sheet Location	As of December 31, 2016
Hedging Instruments:
Asset derivatives	Other current assets	$	16.6	Other current assets	$	50.4
	Investments and other assets	$	0.3	Investments and other assets	$	6.6
Liability derivatives	Accrued expenses and other	$	10.2	Other long-term liabilities	$	4.6
	Other long-term liabilities	$	2.5
Other Derivatives:
Asset derivatives	Other current assets	$	10.3	Other current assets	$	4.0
Liability derivatives	Accrued expenses and other	$	2.0	Accrued expenses and other	$	9.0



(In millions)	Income Statement Location	Amounts Reclassified from Accumulated Other Comprehensive Income
		For the Three Months Ended June 30,						For the Six Months Ended June 30,
		2016			2015			2016			2015
Gains (losses) on securities available for sale	Other income (expense)	$	(0.6	)	$	(0.2	)	$	(0.6	)	$	(0.3	)
	Income tax benefit (expense)	0.2			0.1			0.2			0.1

Gains (losses) on cash flow hedges	Revenues	(4.3		)	40.4			4.5			75.4
	Operating expenses	(0.1		)	—			(0.2		)	—
	Other income (expense)	—			—			0.1			—
	Income tax benefit (expense)	0.1			(0.2		)	—			(0.4		)

Total reclassifications, net of tax		$	(4.7	)	$	40.1		$	4.0		$	74.8



		~~Rates post Sobi Opt-In~~⁽³⁾
~~Royalty and Net Revenue Share Rates:~~	~~Method~~	~~Base Rate following~~ ~~1st commercial sale in~~ ~~the Sobi Territory:~~	~~Rate during the~~ ~~Reimbursement~~ ~~Period:~~
~~Sobi rate to Biogen on net sales in the Sobi Territory~~	~~Royalty~~	~~12%~~	~~Base Rate~~ ~~plus 5%~~
~~Biogen rate to Sobi on net sales in the Biogen North America Territory~~	~~Royalty~~	~~12%~~	~~Base Rate~~ ~~less 5%~~
~~Biogen rate to Sobi on net sales in the Biogen Direct Territory~~	~~Royalty~~	~~17%~~	~~Base Rate~~ ~~less 5%~~
~~Biogen rate to Sobi on net revenue~~⁽¹⁾ ~~from the Biogen Distributor Territory~~⁽²⁾	~~Net~~ ~~Revenue~~ ~~Share~~	~~50%~~	~~Base Rate~~ ~~less 15%~~


~~(1)~~	~~Net revenue represents Biogen’s pre-tax receipts from third-party distributors, less expenses incurred by Biogen in the conduct of commercialization activities supporting the distributor activities.~~


~~(2)~~	~~The Biogen Distributor Territory represents Biogen territories where sales are derived utilizing a third-party distributor.~~


~~(3)~~	A credit will be issued to Sobi against its reimbursement of the Opt-in Consideration in an amount equal to the difference in the rate paid by Biogen to Sobi on sales in the Biogen territories for certain periods prior to the first commercial sale in the Sobi Territory versus the rate that otherwise would have been payable on such sales.


(In millions, except percentages)	As of June 30, 2016			As of December 31, 2015			Change %		As of June 30, 2017			As of December 31, 2016			Change %
Financial assets:
Cash and cash equivalents	$	1,362.0		$	1,308.0		4.1	%	$	1,169.5		$	2,326.5		(49.7	)%
Marketable securities — current	2,434.8			2,120.5			14.8	%	1,723.5			2,568.6			(32.9	)%
Marketable securities — non-current	3,477.6			2,760.4			26.0	%	2,632.7			2,829.4			(7.0	)%
Total cash, cash equivalents and marketable securities	$	7,274.4		$	6,188.9		17.5	%	$	5,525.7		$	7,724.5		(28.5	)%
Borrowings:
Current portion of notes payable and other financing arrangements	$	4.8		$	4.8		—	%	$	559.9		$	4.7		**
Notes payable and other financing arrangements	6,538.3			6,521.5			0.3	%	5,954.0			6,512.7			(8.6	)%
Total borrowings	$	6,543.1		$	6,526.3		0.3	%	$	6,513.9		$	6,517.4		(0.1	)%
Working capital:
Current assets	$	7,447.7		$	6,700.3		11.2	%	$	7,108.7		$	8,732.2		(18.6	)%
Current liabilities	(2,516.2		)	(2,577.7		)	(2.4	)%	(3,379.7		)	(3,419.9		)	(1.2	)%
Total working capital	$	4,931.5		$	4,122.6		19.6	%	$	3,729.0		$	5,312.3		(29.8	)%


◦	$454.8 million payment made to Forward Pharma for the litigation and settlement charges that were accrued as of December 31, 2016; and