Biogen (BIIB) 10-Q 17 Jul 09 2009 Q2 Quarterly report Financial data

Document and Company Informatio

Document and Company Information (USD $)
	6 Months Ended Jun. 30, 2009	Jul. 13, 2009
Document and Entity Information [Abstract]
Entity Registrant Name	Biogen Idec Inc.
Entity Central Index Key	0000875045
Document Type	10-Q
Document Period End Date	2009-06-30
Amendment Flag	false
Amendment Description	N/A
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float	13005469098
Entity Common Stock, Shares Outstanding		288,855,922

Consolidated Statements of Inco

Consolidated Statements of Income (USD $)
In Thousands, except Per Share data	3 Months Ended Jun. 30, 2009	3 Months Ended Jun. 30, 2008	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
Revenues:
Product	$790,970	$684,486	$1,524,378	$1,349,556
Unconsolidated joint business	275,570	278,822	554,388	526,045
Other revenues	26,749	30,136	51,008	60,029
Total revenues	1,093,289	993,444	2,129,774	1,935,630
Costs and expenses:
Cost of sales, excluding amortization of acquired intangible assets	90,721	92,401	188,918	193,335
Research and development	416,453	252,259	695,931	510,491
Selling, general and administrative	220,829	245,689	442,660	461,518
Collaboration profit sharing	49,138	33,429	91,911	54,835
Amortization of acquired intangible assets	93,234	72,869	182,482	147,650
Acquired in-process research and development	0	0	0	25,000
Total costs and expenses	870,375	696,647	1,601,902	1,392,829
Income from operations	222,914	296,797	527,872	542,801
Other income (expense), net	14,680	(4,018)	21,526	(938)
Income before income tax expense	237,594	292,779	549,398	541,863
Income tax expense	92,709	84,706	157,934	167,983
Net income	144,885	208,073	391,464	373,880
Net income attributable to noncontrolling interest, net of tax	2,040	1,445	4,632	4,155
Net income attributable to Biogen Idec Inc.	$142,845	$206,628	$386,832	$369,725
Basic earnings per share attributable to Biogen Idec Inc.	0.49	0.71	1.34	1.26
Diluted earnings per share attributable to Biogen Idec Inc.	0.49	0.7	1.33	1.24
Weighted-average shares used in calculating:
Basic earnings per share attributable to Biogen Idec Inc.	288,615	290,356	288,162	293,268
Diluted earnings per share attributable to Biogen Idec Inc.	290,359	293,476	290,014	296,554

Consolidated Balance Sheets

Consolidated Balance Sheets (USD $)
In Thousands	Jun. 30, 2009	Dec. 31, 2008
Current assets:
Cash and cash equivalents	$786,804	$622,385
Marketable securities	836,270	719,586
Collateral received for loaned securities	0	29,991
Accounts receivable, net	511,286	446,665
Due from unconsolidated joint business	198,206	206,925
Loaned securities	0	29,446
Inventory	268,529	263,602
Other current assets	143,183	139,400
Total current assets	2,744,278	2,458,000
Marketable securities	1,047,611	891,406
Property, plant and equipment, net	1,608,660	1,594,754
Intangible assets, net	1,978,519	2,161,058
Goodwill	1,138,621	1,138,621
Investments and other assets	259,507	235,152
Total assets	8,777,196	8,478,991
Current liabilities:
Collateral payable on loaned securities	0	29,991
Accounts payable	210,941	107,417
Taxes payable	81,594	223,260
Accrued expenses and other	496,694	534,887
Current portion of notes payable and line of credit	14,697	27,667
Total current liabilities	803,926	923,222
Notes payable and line of credit	1,085,607	1,085,431
Long-term deferred tax liability	310,962	356,017
Other long-term liabilities	330,996	280,369
Total liabilities	2,531,491	2,645,039
Equity:
Preferred stock, par value $0.001 per share	0	0
Common stock, par value $0.0005 per share	149	149
Additional paid-in capital	6,142,936	6,073,957
Accumulated other comprehensive income (loss)	11,293	(11,106)
Retained earnings	516,632	270,180
Treasury stock, at cost	(458,472)	(527,097)
Total Biogen Idec Inc. shareholders' equity	6,212,538	5,806,083
Noncontrolling interest	33,167	27,869
Total equity	6,245,705	5,833,952
Total liabilities and equity	$8,777,196	$8,478,991

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) (USD $)
	Jun. 30, 2009	Dec. 31, 2008
Preferred stock, par value	0.001	0.001
Common stock, par value	0.0005	0.0005

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (USD $)
In Thousands	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
Cash flows from operating activities:
Net income	$391,464	$373,880
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation and amortization of property, plant and equipment and intangible assets	248,877	212,471
Acquired in-process research and development	0	25,000
Share-based compensation	78,892	67,647
Non-cash interest (income) expense and foreign exchange remeasurement loss (gain), net	(7,592)	12,151
Deferred income taxes	(42,772)	(14,757)
Realized gain on sale of marketable securities and strategic investments	(15,434)	(5,928)
Write-down of inventory to net realizable value	11,475	9,838
Impairment of marketable securities, investments and other assets	10,002	15,451
Excess tax benefit from stock options	(2,800)	(18,448)
Changes in operating assets and liabilities, net:
Accounts receivable	(63,842)	(86,302)
Due from unconsolidated joint business	8,719	(17,535)
Inventory	(14,353)	(28,187)
Other assets	(5,537)	(7,427)
Accrued expenses and other current liabilities	22,950	101,412
Other liabilities and taxes payable	(90,748)	3,741
Net cash flows provided by operating activities	529,301	643,007
Cash flows from investing activities:
Purchases of marketable securities	(1,869,415)	(1,060,159)
Proceeds from sales and maturities of marketable securities	1,637,562	1,391,949
Collateral received under securities lending	29,991	61,253
Acquisitions, net of cash acquired	0	(25,000)
Purchases of property, plant and equipment	(71,721)	(157,093)
Purchases of other investments	(35,202)	(11,611)
Proceeds from the sale of a strategic equity investment	5,565	15
Net cash flows (used in) provided by investing activities	(303,220)	199,354
Cash flows from financing activities:
Purchase of treasury stock	(57,631)	(559,767)
Proceeds from issuance of stock for share-based compensation arrangements	24,387	89,532
Change in cash overdraft	7,525	873
Excess tax benefit from stock options	2,800	18,448
Proceeds from borrowings	0	986,980
Repayment of borrowings	(10,867)	(1,512,474)
Obligation under securities lending	(29,991)	(61,253)
Net cash flows used in financing activities	(63,777)	(1,037,661)
Net increase (decrease) in cash and cash equivalents	162,304	(195,300)
Effect of exchange rate changes on cash and cash equivalents	2,115	2,131
Cash and cash equivalents, beginning of the period	622,385	659,662
Cash and cash equivalents, end of the period	$786,804	$466,493

Business Overview

Business Overview
	6 Months Ended Jun. 30, 2009 USD / shares
Business Overview [Abstract]
Business Overview	1. Business Overview Overview Biogen Idec Inc. (Biogen Idec, we, us or the Company) is a global biotechnology company that creates new standards of care in therapeutic areas with high unmet medical needs. We currently have four marketed products. Our marketed products are used for the treatment of multiple sclerosis, or MS, non-Hodgkins lymphoma, or NHL, rheumatoid arthritis, or RA, Crohns disease and psoriasis, which are summarized in the table below. Product Indications AVONEX Relapsing MS (interferon beta-1a) RITUXAN* Certain B-cell NHL (rituximab) RA TYSABRI** Relapsing MS (natalizumab) Crohns disease FUMADERM Severe psoriasis (dimethylfumarate and monoethylfumarate salts) * Outside the United States, Canada and Japan, MabThera is the trade name for rituximab. We refer to rituximab, RITUXAN and MabThera collectively as RITUXAN. ** TYSABRI is indicated in the United States for the treatment of some patients with moderately to severely active Crohns disease. Basis of Presentation In the opinion of management, the accompanying unaudited consolidated financial statements include all adjustments, consisting of only normal recurring accruals, necessary for a fair statement of our financial position, results of operations and cash flows. The information included in this quarterly report on Form10-Q should be read in conjunction with our consolidated financial statements and the accompanying notes included in our annual report on Form10-K for the year ended December31, 2008. Our accounting policies are described in the Notes to Consolidated Financial Statements in our 2008 annual report on Form10-K and updated, as necessary, in this Form10-Q. The year-end consolidated balance sheet data presented for comparative purposes was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States. The results of operations for the three and six months ended June30, 2009 are not necessarily indicative of the operating results for the full year or for any other subsequent interim period. Effective January1, 2009, we implemented Statement of Financial Accounting Standards No.160, Noncontrolling Interests in Consolidated Financial Statements, an amendment to ARB No.51, or SFAS160. This standard changed the accounting for and reporting of minority interest (now called noncontrolling interest) in our consolidated financial statements. Upon adoption, certain prior period amounts have been reclassified to conform to the current period financial statement presentation. These reclassifications did not have a material impact on our previously reported financial position or results of operations. Refer to Note8, Equity, and Note12, Other Income (Expense), Net, of this Form10-Q for additional information on the adoption of SFAS160. Principles of Consolidation The consolidated financial statements reflect our financial statements, those of our wholly-owned subsidiaries and of our joint

Inventory

Inventory
	6 Months Ended Jun. 30, 2009 USD / shares
Inventory [Abstract]
Inventory	2. Inventory Inventories are stated at the lower of cost or market with cost determined under the first-in, first-out, or FIFO, method. Included in inventory are raw materials used in the production of pre-clinical and clinical products, which are charged to research and development expense when consumed. The components of inventories are as follows (in millions): As of As of June30, December31, 2009 2008 Raw materials $ 38.8 $ 29.8 Work in process 173.4 180.0 Finished goods 56.3 53.8 Total Inventory $ 268.5 $ 263.6 Amounts written down related to unmarketable inventory are charged to cost of product revenues, a component of total cost of sales, excluding amortization of acquired intangible assets. During the three and six months ended June30, 2009 we have written-down $2.1million and $11.5million, respectively, in unmarketable inventory as compared to $5.5million and $9.8million, respectively, during the prior year comparative periods.

Revenue Recognition

Revenue Recognition
	6 Months Ended Jun. 30, 2009 USD / shares
Revenue Recognition [Abstract]
Revenue Recognition	3. Revenue Recognition Product Revenues We recognize revenue when all of the following criteria are met: persuasive evidence of an arrangement exists; delivery has occurred or services have been rendered; the sellers price to the buyer is fixed or determinable; and collectibility is reasonably assured. Revenues from product sales are recognized when title and risk of loss have passed to the customer, which is typically upon delivery. However, under the terms of a development and marketing collaboration agreement with Elan Pharma International, Ltd., or Elan, an affiliate of Elan Corporation, plc, we manufacture TYSABRI and collaborate with Elan on the products marketing, commercial distribution and on-going development activities. Therefore, sales of TYSABRI in the United States are recognized on the sell-through model, that is, upon shipment of the product by Elan to its third party distributor rather than upon shipment to Elan. For sales of TYSABRI outside the United States, we are responsible for distributing TYSABRI to customers and are primarily responsible for all operating activities. Generally, revenue on sales of TYSABRI outside the United States is recognized at the time of product delivery to our customers and distributors, as all revenue recognition criteria have been met. Reserves Reserves for Discounts and Allowances Revenues are recorded net of applicable allowances for trade term discounts, wholesaler incentives, Medicaid rebates, Veterans Administration rebates, managed care rebates, product returns and other applicable allowances. Reserves established for these discounts and allowances are classified as reductions of accounts receivable (if the amount is payable to our customer) or a liability (if the amount is payable to a party other than our customer). Our product revenue reserves are based on estimates of the amounts earned or to be claimed on the related sales. These estimates take into consideration our historical experience, current contractual requirements, statutory requirements, specific known market events and trends and forecasted customer buying patterns. If actual results vary, we may need to adjust these estimates, which could have an effect on earnings in the period of the adjustment. An analysis of the amount of, and change in, reserves is as follows (in millions): Contractual Discounts Adjustments Returns Total Beginning balance, as of January1, 2009 $ 9.2 $ 48.1 $ 18.1 $ 75.4 Current provisions relating to sales in current period 36.3 89.5 9.6 135.4 Adjustments relating to prior periods 3.2 3.2 Payments/returns relating to sales in current period (24.5 ) (35.8 ) (0.3 ) (60.6 ) Payments/returns relating to sales in prior periods (8.1 ) (46.7 ) (8.6 ) (63.4 ) Ending balance, as of June30,

Intangible Assets and Goodwill

Intangible Assets and Goodwill
	6 Months Ended Jun. 30, 2009 USD / shares
Intangible Assets and Goodwill [Abstract]
Intangible Assets and Goodwill	4. Intangible Assets and Goodwill Intangible assets and goodwill, net of accumulated amortization, impairment charges and adjustments, are as follows (in millions): As of June30, As of December31, 2009 2008 Estimated Accumulated Accumulated Life Cost Amortization Net Cost Amortization Net Out-licensed patents 12years $ 578.0 $ (274.3 ) $ 303.7 $ 578.0 $ (250.3 ) $ 327.7 Core/developed technology 15-20years 3,005.3 (1,397.1 ) 1,608.2 3,005.3 (1,241.0 ) 1,764.3 Trademarks and tradenames Indefinite 64.0 64.0 64.0 64.0 In-licensed patents 14years 3.0 (1.0 ) 2.0 3.0 (0.9 ) 2.1 Assembled workforce 4years 2.1 (1.5 ) 0.6 2.1 (1.2 ) 0.9 Distribution rights 2years 12.7 (12.7 ) 12.7 (10.6 ) 2.1 Total intangible assets $ 3,665.1 $ (1,686.6 ) $ 1,978.5 $ 3,665.1 $ (1,504.0 ) $ 2,161.1 Goodwill Indefinite $ 1,138.6 $ $ 1,138.6 $ 1,138.6 $ $ 1,138.6 Intangible Assets Our intangible assets consist of patents, licenses, core/developed technology, trademarks, tradenames, assembled workforce, and distribution rights, the majority of which arose in connection with the merger of Biogen Inc. and Idec Pharmaceuticals Corporation, or the Merger. These intangible assets were recorded at fair value and are stated net of accumulated amortization and impairments. Intangible assets related to patents, licenses, core/developed technology, assembled workforce, and distribution rights are amortized over their remaining estimated useful lives, ranging from 2 to 20years. The useful lives of our assets are primarily based on the legal or contractual life of the underlying patent or contract, which does not include additional years for the extension or renewal of the contract or patent. Our amortization policy for intangible assets is based on the principles in Statement of Financial Accounting Standards No.142, Goodwill and Other Intangible Assets, or SFAS142, which requires that the amortization of intangible assets reflect the pattern that the economic benefits of the intangible assets are consumed. Effective January1, 2009, we implemented FASB Staff Position (FSP) FAS142-3, Determination of the Useful Life of Intangible Assets, or FSP

Fair Value Measurements

Fair Value Measurements
	6 Months Ended Jun. 30, 2009 USD / shares
Fair Value Measurements [Abstract]
Fair Value Measurements	5. Fair Value Measurements Effective January1, 2008, we implemented Statement of Financial Accounting Standards No.157, Fair Value Measurements, or SFAS157, for financial assets and liabilities that are remeasured and reported at fair value at each reporting period, and non-financial assets and liabilities that are remeasured and reported at fair value at least annually. In accordance with the provisions of FSP FAS157-2, Effective Date of FASB Statement No.157, we elected to defer until January1, 2009 implementation of SFAS157 as it relates to our non-financial assets and liabilities that are recognized and disclosed at fair value in the financial statements on a non-recurring basis. The adoption of SFAS157 for our non-financial assets and liabilities that are remeasured at fair value on a non-recurring basis did not have a material impact on our financial position or results of operations upon adoption; however, this standard may impact us in subsequent periods and require additional disclosures. Effective this quarter, we implemented FSP FAS157-4, Determining Fair Value When the Volume and Level of Activity for the Asset or Liability Have Significantly Decreased and Identifying Transactions That Are Not Orderly, or FSP FAS157-4. FSP FAS157-4 provides additional guidelines for making fair value measurements more consistent with the principles presented in SFAS157 and provides authoritative guidance in determining whether a market is active or inactive, and whether a transaction is distressed. This FSP is applicable to all assets and liabilities (i.e. financial and nonfinancial) and requires enhanced disclosures, including interim and annual disclosure of the input and valuation techniques (or changes in techniques) used to measure fair value and the defining of the major security types comprising debt and equity securities held based upon the nature and risk of the security. The adoption of this FSP did not impact our financial position or results of operations; however, adoption has enhanced disclosures for our investments in marketable debt securities and resulted in the reclassification of certain amounts included within our previously reported disclosures to conform to the presentation adopted in the current year. Effective this quarter, we have also implemented FSP FAS107-1 and APB 28-1, Interim Disclosures about Fair Value of Financial Instruments, or FSP FAS107-1. FSP FAS107-1 amended Statement of Financial Accounting Standards No.107, Disclosures about Fair Value of Financial Instruments, and APB Opinion No.28, Interim Financial Reporting, to require disclosures about the fair value of financial instruments in interim as well as in annual financial statements. The adoption of this standard has resulted in the disclosure of the fair values attributable to our debt instruments within our interim report. Since this FSP addresses disclosure requirements, the adoption of this FSP did not impact our financial position or results of operations. Summary of Assets and Liabilities Recorded at Fair Value The tables below present information about our assets and liabilities that are measured at fair va

Financial Instruments

Financial Instruments
	6 Months Ended Jun. 30, 2009 USD / shares
Financial Instruments [Abstract]
Financial Instruments	6. Financial Instruments Financial instruments that potentially subject us to concentrations of credit risk are accounts receivable and marketable securities. The majority of our accounts receivable are payable by wholesale distributors and large pharmaceutical companies and collateral is generally not required from these large customers. We monitor the financial performance and credit worthiness of our large customers so that we can properly assess and respond to changes in their credit profile. Our portfolio of marketable securities is subject to concentration limits set within our investment policy that help to mitigate our credit exposure. Marketable Securities, including Strategic Investments The following is a summary of our marketable securities and strategic investments (in millions): Gross Gross Fair Unrealized Unrealized Amortized As of June30, 2009: Value Gains Losses Cost Available-for-sale Corporate debt securities Current $ 189.9 $ 1.7 $ $ 188.2 Non-current 222.7 5.2 (0.4 ) 217.9 Government securities Current 642.1 1.9 640.2 Non-current 625.4 6.3 (0.3 ) 619.4 Mortgage and other asset backed securities Current 4.3 0.1 4.2 Non-current 199.5 5.5 194.0 Total available-for-sale securities $ 1,883.9 $ 20.7 $ (0.7 ) $ 1,863.9 Other Investments Strategic investments, non-current $ 5.7 $ 2.1 $ $ 3.6 Gross Gross Fair Unrealized Unrealized Amortized As of December31, 2008: Value Gains Losses Cost Available-for-sale Corporate debt securities Current $ 128.2 $ 0.4 $ $ 127.8 Non-current 200.3 2.6 197.7 Government securities Current 582.8 1.5 581.3 Non-current 422.2 8.7 413.5 Mortgage and other asset backed securities Current 13.9 13.9 Non-current 293.0 3.3 (0.3 ) 290.0 Total available-for-sale securiti

Property Plant and Equipment

Property Plant and Equipment
	6 Months Ended Jun. 30, 2009 USD / shares
Property Plant and Equipment Disclosure [Abstract]
Property, Plant and Equipment	7. Property, Plant and Equipment Property, plant and equipment are recorded at historical cost, net of accumulated depreciation of $588.8million and $537.0million as of June30, 2009 and December31, 2008, respectively.

Equity

Equity
	6 Months Ended Jun. 30, 2009 USD / shares
Equity Note Disclosure [Abstract]
Equity	8. Equity The following tables reflects the reconciliation at the beginning and the end of the period of the carrying amount of equity attributable to the shareholders of Biogen Idec Inc., equity attributable to noncontrolling interests, and total equity (in millions): For the For the Three Months Ended June30, 2009 Three Months Ended June30, 2008 Biogen Idec Inc. Biogen Idec Inc. Shareholders Noncontrolling Shareholders Noncontrolling Equity Interest Total Equity Equity Interest Total Equity Beginning Balance $ 5,987.7 $ 32.6 $ 6,020.3 $ 5,532.7 $ 24.7 $ 5,557.4 Comprehensive income: Net income 142.9 2.0 144.9 206.6 1.4 208.0 Unrealized gains(losses) on securities available for sale, net of tax of $(0.8) and $3.5 1.4 1.4 (6.1 ) (6.1 ) Unrealized gains(losses) on foreign currency forward contracts, net of tax of $2.6 and $(3.8) (16.3 ) (16.3 ) 6.5 6.5 Unrealized gains(losses) on pension benefit obligation, net of tax of $0 0.1 0.1 Translation adjustments 58.4 (1.4 ) 57.0 (2.7 ) (0.1 ) (2.8 ) Comprehensive income (loss) 186.5 0.6 187.1 204.3 1.3 205.6 Distribution to noncontrolling interest (1.4 ) (1.4 ) Capital contribution from noncontrolling interest 1.6 1.6 Repurchase of common stock for Treasury, at cost (319.5 ) (319.5 ) Issuance of common stock from conversion of subordinated notes payable 0.1 0.1 Issuance of common stock under stock option and stock purchase plans 7.3 7.3 61.2 61.2 Issuance of common stock under stock award plans (2.0 ) (2.0 ) (1.8 ) (1.8 ) Compensation expense related to share-based payments 42.5 42.5 35.0 35.0 Tax benefit from share-based payments (9.5 ) (9.5 ) 10.9 10.9 Ending Balance $ 6,212.5 $ 33.2 $ 6,245.7 $ 5,522.9

Earnings per Share

Earnings per Share
	6 Months Ended Jun. 30, 2009 USD / shares
Earnings per Share Disclosure [Abstract]
Earnings per Share	9. Earnings per Share Basic and diluted earnings per share are calculated as follows (in millions): For the For the Three Months Six Months Ended Ended June30, June30, 2009 2008 2009 2008 Numerator: Net income attributable to Biogen Idec Inc. $ 142.8 $ 206.6 $ 386.8 $ 369.7 Adjustment for net income allocable to preferred stock (0.2 ) (0.3 ) (0.7 ) (0.6 ) Net income used in calculating basic and diluted earnings per share $ 142.6 $ 206.3 $ 386.1 $ 369.1 Denominator: Weighted average number of common shares outstanding 288.6 290.4 288.2 293.3 Effect of dilutive securities: Stock options and employee stock purchase plan 0.7 1.9 0.7 2.0 Time-vested restricted stock units 1.1 1.2 1.1 1.2 Performance-vested restricted stock units Restricted stock awards 0.1 Dilutive potential common shares 1.8 3.1 1.8 3.3 Shares used in calculating diluted earnings per share 290.4 293.5 290.0 296.6 The following amounts were not included in the calculation of net income per share because their effects were anti-dilutive or the performance criteria had not been met for the performance-vested restricted stock units (in millions): For the For the Three Months Ended Six Months Ended June30, June30, 2009 2008 2009 2008 Numerator: Net income allocable to preferred stock $ 0.2 $ 0.3 $ 0.7 $ 0.6 Denominator: Stock options 7.4 4.0 7.3 5.2 Time-vested restricted stock units 1.1 0.2 1.1 0.2 Performance-vested restricted stock units Convertible preferred stock 0.5 0.5 0.5 0.5 Total 9.0 4.7 8.9 5.9 Effective January1, 2009, we implemented FSP EITF03-6-1, Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities, or FSP EITF03-6-1. FSP EITF03-6-1 addresses whether ins

Share Based Payments

Share Based Payments
	6 Months Ended Jun. 30, 2009 USD / shares
Share-Based Payments [Abstract]
Share-Based Payments	10. Share-Based Payments Our share-based compensation programs consist of share-based awards which include stock options, time-vested restricted stock units and performance-vested restricted stock units, as well as our employee stock purchase plan. Shared-based compensation expense For the three and six months ended June30, 2009 and 2008, share-based compensation expense recorded in accordance with Statement of Financial Accounting Standards No.123 (revised 2004), Share-Based Payments, or SFAS123(R), reduced our results of operations as follows (in millions, except per share amounts): For the For the Three Months Ended Six Months Ended June30, June30, 2009 2008 2009 2008 Effect on Effect on Net Income Net Income Income before income taxes $ (41.1 ) $ (33.1 ) $ (78.9 ) $ (67.6 ) Tax effect 12.7 10.0 24.2 20.8 Net income attributable to Biogen Idec, Inc. $ (28.4 ) $ (23.1 ) $ (54.7 ) $ (46.8 ) Share-based compensation expense and capitalized share-based costs for the three and six months ended June30, 2009 and 2008 were as follows (in millions): For the For the Three Months Ended June30, 2009 Three Months Ended June30, 2008 Stock Restricted Stock Stock Restricted Stock Options and Restricted Options and Restricted ESPP Stock Units Total ESPP Stock Units Total Research and development $ 1.2 $ 12.9 $ 14.1 $ 1.4 $ 12.8 $ 14.2 Selling, general and administrative 5.2 23.2 28.4 3.8 17.0 20.8 Total $ 6.4 $ 36.1 $ 42.5 $ 5.2 $ 29.8 $ 35.0 Capitalized share-based payment costs (1.4 ) (1.9 ) Share-based compensation expense $ 41.1 $ 33.1 For the For the Six Months Ended June30, 2009 Six Months Ended June30, 2008 Stock Restricted Stock Stock Restricted Stock Options and Restricted Options and Restricted ESPP Stock Units Total ESPP Stock Units

Income Taxes

Income Taxes
	6 Months Ended Jun. 30, 2009 USD / shares
Income Taxes [Abstract]
Income Taxes	11. Income Taxes Our effective tax rate was 39.0% and 28.7% for the three and six months ended June30, 2009, respectively, compared to 28.9% and 31.0% for the prior year comparative periods. The effective tax rate for the six months ended June30, 2009 was favorably impacted by changes in tax law that became effective during 2009 in certain state jurisdictions in which we operate. These changes required us to establish assets for certain tax credits and adjust certain deferred tax liabilities and reserves for uncertain tax positions, having a favorable effect of 5.5%. This favorable effect was offset by the impact of the collaboration and license agreement entered into with Acorda Therapeutics, Inc., or Acorda. There is no income tax benefit associated with the upfront payment made to Acorda, by a non-U.S.affiliate, which had a 7.5% and 2.3% unfavorable effect for the three and six months ended June30, 2009, respectively. Refer to Note13, Collaborations, of this Form10-Q for additional information related to the Acorda transaction. Our effective tax rate for the six months ended June30, 2008 was favorably impacted by the restructuring of our operations in foreign jurisdictions as well as other activities. Reconciliation between the U.S.federal statutory tax rate and our effective tax rate for the three and six months ended June30, 2009 and 2008 is as follows: For the For the Three Months Six Months Ended Ended June30, June30, 2009 2008 2009 2008 Statutory rate 35.0 % 35.0 % 35.0 % 35.0 % State taxes 4.1 1.6 1.1 2.2 Taxes on foreign earnings (2.7 ) (11.2 ) (4.4 ) (10.0 ) Credits and net operating loss utilization (1.3 ) 0.5 (5.9 ) (0.5 ) Fair value adjustment 4.4 3.6 2.8 3.5 IPRD 1.4 1.2 1.6 Non-deductible items (2.6 ) (0.7 ) (1.8 ) (0.8 ) Other 0.7 0.1 0.7 Effective tax rate 39.0 % 28.9 % 28.7 % 31.0 % On September12, 2006, we received a Notice of Assessment from the Massachusetts Department of Revenue for $38.9million, including penalties and interest, with respect to the 2002 tax year. Subsequently, we filed a petition with the Massachusetts Appellate Tax Board, seeking among other items, abatements of corporate excise tax for the 2001, 2002 and 2003 tax years. We believe that we have meritorious defenses to the proposed adjustment and are vigorously opposing the assessment. We believe that the assessment does not impact the level of liabilities for income tax contingencies. However, there is a possibility that we may not prevail in all of our assertions. If this is resolved u

Other Income

Other Income (Expense), Net
	6 Months Ended Jun. 30, 2009 USD / shares
Other Income (Expense), Net [Abstract]
Other Income (Expense), Net	12. Other Income (Expense), Net Total other income (expense), net, consists of the following (in millions): For the For the Three Months Six Months Ended Ended June30, June30, 2009 2008 2009 2008 Interest income $ 12.1 $ 15.3 $ 26.9 $ 38.2 Interest expense (9.3 ) (13.9 ) (19.2 ) (29.6 ) Impairments of investments (3.5 ) (5.9 ) (9.6 ) (14.6 ) Other, net 15.4 0.5 23.4 5.1 Total other income (expense), net $ 14.7 $ (4.0 ) $ 21.5 $ (0.9 ) Impairment on Investments During the three and six months ended June30, 2009, we recognized impairment losses of $3.5million and $6.0million, respectively on our strategic investments and non-marketable securities. In addition, during the three and six months ended June30, 2008, we recognized $3.0million and $9.4million, respectively, in charges for the impairment of strategic investments and non-marketable securities that were determined to be other-than-temporary. No impairment losses were recognized through earnings related to available for sale securities during the three months ended June30, 2009. For the six months ended June30, 2009, we recognized $3.6million in charges for the impairment of available for sale securities primarily related to mortgage and asset backed securities when we lacked the ability and intent to hold the securities to recovery. For the three and six months ended June30, 2008, we recognized $2.9million and $5.2million, respectively, in charges for the other-than-temporary impairment of available for sale securities primarily related to mortgage and asset backed securities. Other, net During the three and six months ended June30, 2009, Other, net included net gains on foreign currency of $1.9million and $7.4million, respectively, and reflected $7.5million and $11.9million, respectively, in net realized gains on marketable securities. Other, net for the three and six months ended June30, 2009 also included a $2.8million gain recognized on the sale of two strategic equity investments. Other, net for the three and six months ended June30, 2008 included gains on sales of marketable securities of $0.6million and $6.0million, respectively. Other, net for the six months ended June30, 2008 also included losses on foreign currency of $0.9million and hedge ineffectiveness of $1.2million, offset by a VAT refund of $3.8million. Noncontrolling Interest Prior year amounts related to noncontrolling interest (minority interest), historically reflected as a component of other income (expense), net, have been reclassified to conform to current year presentation as required by SFAS160. The adoption of SFAS160 has resulted in the reclassification of amounts previously reported as minority

Collaborations

Collaborations
	6 Months Ended Jun. 30, 2009 USD / shares
Collaborations [Abstract]
Collaborations	13. Collaborations In connection with our business strategy, we have entered into various collaboration agreements which provide us with rights to develop, produce and market products using certain know-how, technology and patent rights maintained by our collaborative partners. Terms of the various collaboration agreements may require us to make milestone payments upon the achievement of certain product research and development objectives and pay royalties on future sales, if any, of commercial products resulting from the collaboration. EITF No.07-01, Accounting for Collaborative Arrangements, or EITF07-01, prescribes that certain transactions between collaborators be recorded in the income statement on either a gross or net basis, depending on the characteristics of the collaboration relationship, and provides for enhanced disclosure of collaborative relationships. In accordance with EITF07-01, we evaluate our collaborative agreements for proper income statement classification based on the nature of the underlying activity. If payments to and from our collaborative partners are not within the scope of other authoritative accounting literature, the income statement classification for the payments is based on a reasonable, rational analogy to authoritative accounting literature that is applied in a consistent manner. Amounts due from our collaborative partners related to development activities are generally reflected as a reduction of research and development expense because the performance of contract development services is not central to our operations. For collaborations with commercialized products, if we are the principal, as defined in EITF No.99-19, Reporting Revenue as a Principal versus Net as an Agent, or EITF99-19, we record revenue and the corresponding operating costs in their respective line items within our statement of income. If we are not the principal, we record operating costs as a reduction of revenue. EITF99-19 describes the principal as the party who is responsible for delivering the product or service to the customer, has latitude to determine price, and has the risks and rewards of providing product or service to the customer, including inventory and credit risk. The adoption of EITF07-01 did not impact our financial position or results of operations; however it resulted in enhanced disclosures for our collaboration activities. Genentech We collaborate with Genentech, Inc., or Genentech, wholly-owned subsidiary of Roche Holdings, Inc., on the development and commercialization of RITUXAN. We also have rights to collaborate with Genentech on the development and commercialization of (1)anti-CD20 products that Genentech acquires or develops, which we refer to as New Anti-CD20 Products, and (2)anti-CD20 products that Genentech licenses from a third party, which we refer to as Third Party Anti-CD20 Products. Currently, there is only one New Anti-CD20 Product, ocrelizumab, and only one Third Party Anti-CD20 Product, GA101. Our collaboration rights for New Anti-CD20 Products are limited to the United States and our collaboration rights for Third Party Anti-CD20 Products are dependent upon Gen

Litigation

Litigation
	6 Months Ended Jun. 30, 2009 USD / shares
Litigation [Abstract]
Litigation	14. Litigation Along with several other major pharmaceutical and biotechnology companies, Biogen, Inc. (now Biogen Idec MA, Inc., one of our wholly-owned subsidiaries) or, in some cases, Biogen Idec Inc., was named as a defendant in lawsuits filed by the City of New York and numerous Counties of the State of New York. All of the cases except for cases filed by the County of Erie, County of Oswego and County of Schenectady, or the Three County Actions are the subject of a Consolidated Complaint, first filed on June15, 2005 in the U.S.District Court for the District of Massachusetts in Multi-District Litigation No.1456, or the MDL proceedings. The complaints allege that the defendants (i)fraudulently reported the Average Wholesale Price for certain drugs for which Medicaid provides reimbursement, or the Covered Drugs; (ii)marketed and promoted the sale of Covered Drugs to providers based on the providers ability to collect inflated payments from the government and Medicaid beneficiaries that exceeded payments possible for competing drugs; (iii)provided financing incentives to providers to over-prescribe Covered Drugs or to prescribe Covered Drugs in place of competing drugs; and (iv)overcharged Medicaid for illegally inflated Covered Drugs reimbursements. Among other things, the complaints allege violations of New York state law and advance common law claims for unfair trade practices, fraud, and unjust enrichment. In addition, the amended Consolidated Complaint alleges that the defendants failed to accurately report the best price on the Covered Drugs to the Secretary of Health and Human Services pursuant to rebate agreements, and excluded from their reporting certain discounts and other rebates that would have reduced the best price. With respect to the MDL proceedings, some of the plaintiffs claims were dismissed, and the parties, including Biogen Idec, began a mediation of the outstanding claims on July1, 2008. We have not formed an opinion that an unfavorable outcome is either probable or remote in any of these cases, and do not express an opinion at this time as to their likely outcome or as to the magnitude or range of any potential loss. We believe that we have good and valid defenses to each of these complaints and are vigorously defending against them. On June17, 2006, Biogen Idec filed a Demand for Arbitration against Genentech, Inc. with the American Arbitration Association, or the AAA, which Demand was amended on December5, 2006 and on January29, 2008. In the Demand, Biogen Idec alleged that Genentech breached the parties Amended and Restated Collaboration Agreement dated June19, 2003, or the Collaboration Agreement, by failing to honor Biogen Idecs right to participate in strategic decisions affecting the parties joint development of certain pharmaceutical products, including humanized anti-CD20 antibodies. Genentech filed an Answering Statement in response to Biogen Idecs Demand in which Genentech denied that it had breached the Collaboration Agreement and alleged that Biogen Idec had breached the Collaboration Agreement. In its Answering Statement, filed in 2006, Genentech also asserted for the first time

Segment Information

Segment Information
	6 Months Ended Jun. 30, 2009 USD / shares
Segment Information [Abstract]
Segment Information	15. Segment Information We operate in one business segment, which is the business of development, manufacturing and commercialization of novel therapeutics for human health care and therefore, our chief operating decision-maker manages the operation of the Company as a single operating segment.

New Accounting Pronouncements

New Accounting Pronouncements
	6 Months Ended Jun. 30, 2009 USD / shares
New Accounting Pronouncements [Abstract]
New Accounting Pronouncements	16. New Accounting Pronouncements Effective January1, 2009, we implemented Statement of Financial Accounting Standards No.141(R), Business Combination, or SFAS141(R). This standard requires an acquiring company to measure all assets acquired and liabilities assumed, including contingent considerations and all contractual contingencies, at fair value as of the acquisition date. In addition, an acquiring company is required to capitalize IPRD and either amortize it over the life of the product, or write it off if the project is abandoned or impaired. The adoption of this standard did not have a material impact on our financial position or results of operations as SFAS141(R) is applicable to acquisitions completed after January1, 2009 and we did not complete any business combination transactions during the first six months of 2009. SFAS141(R) also amended Statement of Financial Accounting Standards No.109, Accounting for Income Taxes, or SFAS109, and FASB Interpretation No.48, Accounting for Uncertainty in Income Taxes, or FIN48. Previously, SFAS109 and FIN48, generally required post-acquisition adjustments related to business combination deferred tax asset valuation allowances and liabilities for uncertain tax positions to be recorded as an increase or decrease to goodwill. SFAS141(R) does not permit this accounting and, generally, requires any such changes to be recorded in current period income tax expense. Thus, all changes to valuation allowances and liabilities for uncertain tax positions established in acquisition accounting, whether the business combination was accounted for under SFAS141 or SFAS141(R), will be recognized in current period income tax expense. On April1, 2009, the FASB Board issued FSP FAS141(R)-1, Accounting for Assets Acquired and Liabilities Assumed in a Business Combination That Arise from Contingencies, or FSP FAS141(R)-1. FSP FAS141(R)-1 amends and clarifies SFAS141(R), to address application issues regarding the initial recognition and measurement, subsequent measurement and accounting, and disclosure of assets and liabilities arising from contingencies in a business combination. Due to the fact that SFAS141(R) is applicable to acquisitions completed after January1, 2009 and we did not have any business combinations in the first six months of 2009, the adoption of FSP FAS141(R)-1 did not impact our financial position or results of operations. In April 2009, the Securities and Exchange Commission, or SEC, issued Staff Accounting Bulletin No. 111 which aligns SEC regulations to the newly issued accounting standards (FSP FAS 115-1 and FAS 124-2) on accounting for other-than-temporary impairments for marketable debt securities. Specifically, it amends Topic 5.M to exclude debt securities from its scope. This bulletin did not impact our financial position or results of operations; however, we conduct periodic reviews to evaluate our investments for the other-than-temporary impairments in accordance with FSP FAS115-1. In June 2009, the SEC issued Staff Accounting BulletinNo.112, which updates the SECs rules and regulations to be consistent with the accounting principles and standard