Indexes Outputs

Default spread 0.00%

Risk free rate 0.70%
CRP 0.37%
Equity risk premium 5.20%
Biogen Beta levered 1.57
Biogen beta unlevered 1.45
Market value of equity in MLN 55,562.97
Market value of debt in MLN 6,599.95
WACC 8.54%
Free cash flow to the Firm 3,594.68
Free cash flow to the Equity 4,333.59
Adj ROC 25%
Adj ROE 28%
gOI 9%
gNI 9%
gStable 0.70%
TV Equity side valuation 129430.71
Value of Equity 108584.04
Value per share 656.09
 BIOGEN INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENT OF INCO

Revenues:
Product, net
Revenues from anti-CD20 therapeutic programs
Other
Total revenues
Cost and expenses:
Cost of sales, excluding amortization and impairment of acquired intangible assets
Research and development
Selling, general and administrative
Amortization and impairment of acquired intangible assets
Collaboration profit (loss) sharing
Loss on divestiture of Hillerød, Denmark manufacturing operations
(Gain) loss on fair value remeasurement of contingent consideration
Restructuring charges
Acquired in-process research and development
Total cost and expenses
Income from operations
Other income (expense), net
Income before income tax expense and equity in loss of investee, net of tax
Income tax expense
Equity in loss of investee, net of tax
Net income
Net income (loss) attributable to noncontrolling interests, net of tax
Net income attributable to Biogen Inc.
Net income per share:
Basic earnings per share attributable to Biogen Inc.
Diluted earnings per share attributable to Biogen Inc.
Weighted-average shares used in calculating:
Basic earnings per share attributable to Biogen Inc.
Diluted earnings per share attributable to Biogen Inc.
Net income attributable to Biogen Inc.
Other comprehensive income:
Unrealized gains (losses) on securities available for sale:
Unrealized gains (losses) recognized during the period, net of tax
Less: reclassification adjustment for (gains) losses included in net income, net of tax
Unrealized gains (losses) on securities available for sale, net of tax
Unrealized gains (losses) on cash flow hedges:
Unrealized gains (losses) recognized during the period, net of tax
Less: reclassification adjustment for (gains) losses included in net income, net of tax
Unrealized gains (losses) on cash flow hedges, net of tax
Gains (losses) on net investment hedges:
Gains (losses) recognized during the period, net of tax
Less: reclassification adjustment for (gains) losses included in net income, net of tax
Gains (losses) on net investment hedges, net of tax
Unrealized gains (losses) on pension benefit obligation, net of tax
Currency translation adjustment
Total other comprehensive income (loss), net of tax
Comprehensive income attributable to Biogen Inc.
Comprehensive income (loss) attributable to noncontrolling interests, net of tax
Comprehensive income

BIOGEN INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (u

ASSETS
Cash, cash equivalents and marketable securities
Accounts receivable, net
Inventory
Other current assets
Total current assets
Marketable securities
Property, plant and equipment, net
Operating lease assets
Intangible assets, net
Goodwill
Investments and other assets
TOTAL ASSETS
LIABILITIES AND EQUITY
Current portion of notes payable
Other current liabilities
Total current liabilities
Notes payable
Long-term operating lease liabilities
Other long-term liabilities
Equity
TOTAL LIABILITIES AND EQUITY

CONDENSED CONSOLIDATED STATEMENTS OF CAS

(unaudited, in millions)

Net income
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation, amortization and impairments
Acquired in-process research and development
Share-based compensation
Contingent consideration
Loss on divestiture of Hillerød, Denmark manufacturing operations
Deferred income taxes
Unrealized (gain) loss on strategic investments
Loss on equity method investment
Other
Changes in operating assets and liabilities, net:
Accounts receivable
Due from anti-CD20 therapeutic programs
Inventory
Accrued expenses and other current liabilities
Income tax assets and liabilities
Other changes in operating assets and liabilities, net
Net cash flows provided by operating activities
Cash flows from investing activities:
Proceeds from sales and maturities of marketable securities
Purchases of marketable securities
Contingent consideration paid related to Fumapharm AG acquisition
Acquisition of Nightstar Therapeutics plc, net of cash acquired
Proceeds from divestiture of Hillerød, Denmark manufacturing oper.
Purchases of property, plant and equipment
Acquired in-process research and development
Acquisitions of intangible assets
Proceeds from sales of strategic investments
Other
Net cash flows provided by investing activities
Cash flows from financing activities:
Purchases of treasury stock
Payments related to issuance of stock for share-based compensation arrangements, net
Other
Net cash flows used in financing activities
Net increase (decrease) in cash and cash equivalents
Effect of exchange rate changes on cash and cash equivalents
Cash and cash equivalents, beginning of the period
Cash and cash equivalents, end of the period
TATEMENT OF INCOME (unaudited, in millions, except per share amounts)

For the 3 Months Ended March 31

As of March 31, As of March 31, As of LAST TTM
2020
2,904.6                2019               
2,680.0 December
11,379.80 11,604.40
31, 2019
520.4 517.4 2,290.40 2,293.40
109.3 292.4 707.70 524.60
3,534.3 3,489.8 14,377.90 14,422.40
— — — —
454.3 602.0 1,955.40 1,807.70
476.3 563.7 2,280.60 2,193.20
570.1 567.7 2,374.70 2,377.10
71.5 68.2 489.90 493.20
71.8 58.1 241.60 255.30
— 115.5 55.30 -60.20
-4.6 11.5 -63.70 -79.80
— 0.4 1.50 1.10
75.0 — — 75.0
1,714.4 1,987.1 7,335.30 7,062.60
1,819.9 1,502.7 7,042.60 7,359.80
-120.5 357.3 83.30 -394.50
1,699.4 1,860.0 7,125.90 6,965.30
292.0 422.5 1,158.00 1,027.50
14.8 28.7 79.40 65.50
1,392.6 1,408.8 5,888.50 5,872.30
6.5 — — 6.5
1,399.1 1,408.8 5,888.50 5,878.80
— — — —
8.10 7.17 31.47 32.40
8.08 7.15 31.42 32.35
— — — —
172.8 196.6 187.10 163.30
173.1 197 187.40 163.50
1,399.1 1,408.8 5,888.50 5,888.50
— — —
— — —
— — 11.80 11.80
-3.60 -3.60
-7.8 6.9 8.20 8.20
— — — —
— — 88.10 88.10
— — -115.00 -115.00
33.8 16.9 -26.90 -26.90
23 14 —
— — 28.60 28.60
— — -7.00 -7.00
— — 21.60 21.60
0.8 0.6 -1.50 -1.50
 -63.9 -17.8 103.80 103.80
-14.10 -20.60 105.20 105.20
1,385.00 1,429.40 5,993.70 5,993.70
-5.9 — -0.40 -0.40
1,379.10 1,429.40 5,993.30 5,993.30

D BALANCE SHEETS (unaudited, in millions)

As of March 31, As of December 31,
2020 2019
3,860.4 4,475.9
2,604.2 2,470.7
858.8 804.2
683.8 631.0
8,007.2 8,381.8
969.5 1,408.1
3,281.6 3,247.3
422.0 427.0
3,446.9 3,527.4
5,752.0 5,757.8
4,240.0 4,484.9
26,119.2 27,234.3

1,501.8 1,495.8
3,136.8 3,368.0
4,638.6 4,863.8
4,459.9 4,459.0
403.7 412.7
4,080.1 4,159.7
12,536.9 13,339.1
26,119.2 27,234.3

STATEMENTS OF CASH FLOWS

d, in millions)
2020 2019 2019 LAST TTM
1,392.60 1,408.80 5,888.50 5,872.30

119.90 121.10 680.60 679.40

75.00 — — 75.00
67.70 45.70 182.30 204.30
-4.60 11.50 -63.70 -79.80
— 115.50 55.30 -60.20
36.90 228.00 67.10 -124.00
62.00 -375.00 437.00
— — —
45.70 50.70 69.20 64.20
-238.40 -136.60 68.80 -33.00
78.60 — -63.30 15.30
-62.20 129.00 -19.20 -210.40
-347.40 -138.40 240.20 31.20
223.00 170.30 16.10 68.80
18.50 -171.10 -43.30 146.30
1,467.30 1,459.50 7,078.60 7,086.40

2,389.30 1,489.20 6,007.00 6,907.10

-1,684.70 -825.00 -5,252.60 -6,112.30
— -300.00 -300.00 0.00
- - -744.40 -
- - 923.70 -
-149.70 -127.10 -514.50 -537.10
-75.00 — — -75.00
-37.00 — -155.00 -192.00
0.50 — 479.30 479.80
-0.50 1.70 27.00 24.80
442.90 238.80 470.50 674.60

-2,220.20 -655.80 -5,868.30 -7,432.70

-29.60 -32.20 - 2.60
4.50 8.70 3.60 -0.60
-2,245.30 -679.30 -5,860.40 -7,426.40
-335.10 1,019.00 1,688.70 334.60
12.70 -0.40 0.40 13.50
2,913.70 1,224.60 1,224.60 2,913.70
2,591.30 2,243.20 2,913.70 3,261.80
 BIOGEN INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME
(In millions, except per share amounts)

For the Years Ended December 31

Revenues: 2019 2018 2017

Product, net 11,379.80 10,886.80 10,354.70
Revenues from anti-CD20 therapeutic programs Other 2,290.40 1,980.20 1,559.20
Other 707.70 585.90 360.00
Total revenues 14,377.90 13,452.90 12,273.90
Cost and expenses:
Cost of sales, excluding amortization and impairment of acquired intangible assets 1,955.40 1,816.30 1,630.00
Research and development 2,280.60 2,597.20 2,253.60
Selling, general and administrative 2,374.70 2,106.30 1,933.90
Amortization and impairment of acquired intangible assets 489.90 747.30 814.70
Collaboration profit (loss) sharing 241.60 185.00 112.30
Loss on divestiture of Hillerød, Denmark manufacturing operations 55.30 — —
(Gain) loss on fair value remeasurement of contingent consideration -63.70 -12.30 62.70
Acquired in-process research and development — 112.50 120.00
Restructuring charges 1.50 12.00 0.90
Total cost and expenses 7,335.30 7,564.30 6,928.10
Income from operations 7,042.60 5,888.60 5,345.80
Other income (expense), net 83.30 11.00 -217.00
Income before income tax expense and equity in loss of investee, net of tax 7,125.90 5,899.60 5,128.80
Income tax expense 1,158.00 1,425.60 2,458.70
Equity in loss of investee, net of tax 79.40 — —
Net income 5,888.50 4,474.00 2,670.10
Net income (loss) attributable to noncontrolling interests, net of tax — 43.30 131.00
Net income attributable to Biogen Inc. 5,888.50 4,430.70 2,539.10
Net income per share:
Basic earnings per share attributable to Biogen Inc. 31.47 21.63 11.94
Diluted earnings per share attributable to Biogen Inc. 31.42 21.58 11.92
Weighted-average shares used in calculating:
Basic earnings per share attributable to Biogen Inc 187.10 204.90 212.6
Diluted earnings per share attributable to Biogen Inc. 187.40 205.30 213
Net income attributable to Biogen Inc. 5,888.50 4,430.70 2,539.10
Other comprehensive income:
Unrealized gains (losses) on securities available for sale:
Unrealized gains (losses) recognized during the period, net of tax 11.80 -10.60 -3.5
Less: reclassification adjustment for (gains) losses included in net income, net of tax -3.60 6.70 12.7
Unrealized gains (losses) on securities available for sale, net of tax 8.20
Unrealized gains (losses) on cash flow hedges: -3.90 9.2
Unrealized gains (losses) recognized during the period, net of tax 88.10 97.40 -193.8
Less: reclassification adjustment for (gains) losses included in net income, net of tax -115.00 41.80 31.5
Unrealized gains (losses) on cash flow hedges, net of tax -26.90 139.20 -162.3
Gains (losses) on net investment hedges:
Gains (losses) recognized during the period, net of tax 28.60 5.00 —
Less: reclassification adjustment for (gains) losses included in net income, net of tax -7.00 -1.50 —
Gains (losses) on net investment hedges, net of tax 21.60 3.50 —
Unrealized gains (losses) on pension benefit obligation, net of tax -1.50 5.50 -4.1
Currency translation adjustment 103.80 -67.80 158.7
Total other comprehensive income (loss), net of tax 105.20 76.50 1.5
Comprehensive income attributable to Biogen Inc. 5,993.70 4,507.20 2,540.60
Comprehensive income (loss) attributable to noncontrolling interests, net of tax -0.40 42.90 131
Comprehensive income 5,993.30 4,550.10 2,671.60
 BIOGEN INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS
(In millions, except per share amounts)

As of December 31
2019 2018
ASSETS
Current assets:
Cash and cash equivalents 2,913.70 1,224.60
Marketable securities 1,562.20 2,313.40
Accounts receivable, net 1,880.50 1,958.50
Due from anti-CD20 therapeutic programs 590.20 526.90
Inventory 804.20 929.90
Other current assets 631.00 687.60
Total current assets 8,381.80 7,640.90
Marketable securities 1,408.10 1,375.90
Property, plant and equipment, net 3,247.30 3,601.20
Operating lease assets 427.00 0.00
Intangible assets, net 3,527.40 3,120.00
Goodwill 5,757.80 5,706.40
Deferred tax asset 3,232.10 2,153.90
Investments and other assets 1,252.80 1,690.60
Total assets 27,234.30 25,288.90
LIABILITIES AND EQUITY
Current liabilities: 1,495.80 —
Current
Taxes portion of notes payable
payable 71.40 63.50
Accounts payable 530.80 370.50
Accrued expenses and other 2,765.80 2,861.20
Total current liabilities 4,863.80 3,295.20
Notes payable 4,459.00 5,936.50
Deferred tax liability 2,810.80 1,636.20
Long-term operating lease liabilities 412.70 —
Other long-term liabilities 1,348.90 1,389.40
Total liabilities 13,895.20 12,257.30
Commitments and contingencies
Equity:
Biogen Inc. shareholders’ equity
Preferred stock, par value $0.001 per share — —
Common stock, par value $0.0005 per share 0.10 0.10
Additional paid-in capital — —
Accumulated other comprehensive loss -135.20 -240.40
Retained earnings 16,455.40 16,257.00
Treasury stock, at cost; 23.8 million and 23.8 million
shares, respectively
-2,977.10 -2,977.10
Total Biogen Inc. shareholders’ equity 13,343.20 13,039.60
Noncontrolling interests -4.10 -8.00
Total equity 13,339.10 13,031.60
Total liabilities and equity 27,234.30 25,288.90
 BIOGEN INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)

Cash flows from operating activities: 2019 2018

Net income 5,888.50 4,474.00
Adjustments to reconcile net income to net cash flows from operating activities:
Depreciation, amortization and impairments 680.60 1,016.60
Acquired in-process research and development — 112.50
Share-based compensation 182.30 157.50
Deferred income taxes 67.10 108.30
Contingent consideration -63.70 -12.30
Loss on divestiture of Hillerød, Denmark manufacturing operations 55.30 —
Other 69.20 -69.10
Changes in operating assets and liabilities, net:
Accounts receivable 68.80 -205.20
Due from anti-CD20 therapeutic programs -63.30 5.70
Inventory -19.20 -52.10
Other assets:
Accrued expenses and other current liabilities 240.20 465.50
Income tax assets and liabilities 16.10 321.70
Other liabilities -43.30 -135.40
Net cash flows provided by operating activities 7,078.60 6,187.70
Cash flows from investing activities:
Proceeds from sales and maturities of marketable securities 6,007.00 9,173.70
Purchases of marketable securities -5,252.60 -7,694.80
Contingent consideration related to Fumapharm AG acquisition -300.00 -1,500.00
Acquisition of Nightstar Therapeutics plc, net of cash acquired -744.40 —
Proceeds from divestiture of Hillerød, Denmark manufacturing operations 923.70 —
Acquired in-process research and development — -112.50
Acquisitions of businesses, net of cash acquired — —
Purchases of property, plant and equipment -514.50 -770.60
Acquisitions of intangible assets -155.00 -3.00
Purchase of Ionis Pharmaceuticals, Inc. stock — -462.90
Investment in Samsung Bioepis — -676.60
Proceeds from sales of strategic investments 479.30 —
Other 27.00 0.40
Net cash flows provided by (used in) investing activities 470.50 -2,046.30
Cash flows from financing activities:
Purchases of treasury stock -5,868.30 -4,352.60
Payments related to issuance of stock for share-based compensation arrangements, net
Net contribution (distribution) to noncontrolling interests 4.30 -36.40
Proceeds from borrowings
Repayments of borrowings — -3.20
Net cash contribution to Bioverativ, Inc. — —
Contingent consideration payments — -58.20
Other 3.60 -21.60
Net cash flows used in financing activities -5,860.40 -4,472.00
Net increase (decrease) in cash and cash equivalents 1,688.70 -330.60
Effect of exchange rate changes on cash and cash equivalents 0.40 -18.60
Cash and cash equivalents, beginning of the year 1,224.60 1,573.80
Cash and cash equivalents, end of the year 2,913.70 1,224.60
OF CASH FLOWS

2017 2016 2015

2,670.10 3,695.70 $ 3.593,20

1,081.00 682.70 600.40

120.00 — —
128.00 154.80 161.40
91.70 -175.00 -145.60
62.70 14.80 30.50
— — —
162.10 89.00 129.90

-435.60 -241.40 29.00

-232.00 13.90 -31.10
-94.50 -165.60 -174.40
-76.60 59.10 -127.00
-227.40 622.30 199.30
1,303.90 -232.60 -429.40
-2.40 69.50 83.20
4,551.00 4,587.20 3,919.40

5,565.90 7,378.90 4,063.00

-5,355.20 -7,913.20 -6,864.90
-1,200.00 -1,200.00 -850.00
— — —
— — —
-120.00 — —
— — -198.80
-867.40 -616.10 -643.00
-975.40 -111.60 -15.40
 — — —
— — —
— — —
-11.00 -22.80 -44.50
-2,963.10 -2,484.80 -4,553.60

-1,365.40 -1,000.00 -5,000.00

-5.30 -8.50 -70.90
-134.10 — -56.10
— — 5,930.50
-560.90 -2.70 -2.10
-302.70 — —
-3.00 -38.60 -13.10
-13.90 -2.80 -5.20
-2,380.00 -1,052.60 783.10
-792.10 1,049.80 148.90
39.40 -31.30 -45.80
2,326.50 1,308.00 1,204.90
1,573.80 $ 2.326,50 $ 1.308,00
 Risk Free rate:
US 10-years treasury
Default spread US 0.00%
bond
Risk free rate US 0.70%

ERP 5.20% The company has been listed

on a mature market so the
ERP’s value is taken from the
Aswath Damodaran* website.
*Source: https://pages.stern.nyu

Country Revenues (2019) % CRP % CRP of Revenue

Operation Based A
U.S. 6713.8 59.0% 0.00% 0.0%
Western Europe 3794.5 33.34% 1.06% 0.35% To evaluate the Biog
Japan 320.3 2.81% 0.69% 0.02% Country Risk Premiu
Other 551.2 4.84% 0.00% 0.00%
Total Revenues 11379.8 0.37%

Western Europe CRP by country Other CRP by country

Germany 0.00% Denmark 0.00%
Italy 2.17% Switzerland 0.00%
French 0.49% Average 0.00%
Portugal 2.17%
Spain 1.57%
Netherlands 0.00%
Average of CRP 1.06%
Source: https://pages.stern.nyu.edu/~adamodar/

Operation Based Approach

To evaluate the Biogen exposure to the

Country Risk Premium.
Comparable Firms Historical Levered BetaMarket D/E Marginal Tax Rate
Amgen 1.13 14.58 27.00%
Gilead Sciences, Inc. 0.99 14.58 27.00%
Regeneron Pharmaceuticals, Inc. 0.8 14.58 27.00%
Seattle Genetics, Inc. 1.71 14.58 27.00%
Repligen Corporation 1.39 14.58 27.00%
Vertex Pharmaceuticals Incorpora 1.32 14.58 27.00%
Alnylam Pharmaceuticals, Inc. 2.22 14.58 27.00%
Alexion Pharmaceuticals, Inc. 1.62 14.58 27.00%
Global Blood Therapeutics, Inc. 1.61 14.58 27.00%
UroGen Pharma Ltd. 1.3 14.58 27.00%
AbbVie Inc. 0.79 14.58 27.00%
Abeona Therapeutics Inc. 1.46 14.58 27.00%
ACADIA Pharmaceuticals Inc 2.34 14.58 27.00%
Xencor, Inc. 1.33 14.58 27.00%
Bellicum Pharmaceuticals, Inc. 1.9 14.58 27.00%
Flexion Therapeutics, Inc. 1.47 14.58 27.00%
Jounce Therapeutics, Inc. 3.89 14.58 27.00%
XOMA Corporation 1.1 14.58 27.00%
AquaBounty Technologies, Inc. 1.03 14.58 27.00%
Calithera Biosciences, Inc. 2.17 14.58 27.00%
Editas Medicine, Inc. 2.51 14.58 27.00%
Palatin Technologies, Inc. 1.67 14.58 27.00%
Bio-Path Holdings, Inc. 3.16 14.58 27.00%
DiaMedica Therapeutics Inc. 1.71 14.58 27.00%
Orgenesis Inc. 1.12 14.58 27.00%
Organovo Holdings, Inc. 1.87 14.58 27.00%
Aeglea BioTherapeutics, Inc. 1.02 14.58 27.00%
Eiger BioPharmaceuticals, Inc. 0.88 14.58 27.00%
Novavax, Inc. 0.36 14.58 27.00%
ZIOPHARM Oncology, Inc. 2.94 14.58 27.00%
Fate Therapeutics, Inc. 1.69 14.58 27.00%
Zafgen, Inc. -0.26 14.58 27.00%
Calyxt, Inc. 2.02 14.58 27.00%
Galectin Therapeutics, Inc. 2.93 14.58 27.00%
Yield10 Bioscience, Inc. 2.46 14.58 27.00%
XBiotech Inc. 1.13 14.58 27.00%
Voyager Therapeutics, Inc. 2.2 14.58 27.00%
VistaGen Therapeutics, Inc. -0.31 14.58 27.00%
DelMar Pharmaceuticals, Inc. 1.22 14.58 27.00%
Viking Therapeutics, Inc. 2.17 14.58 27.00%
Celcuity Inc. 0.78 14.58 27.00%
MacroGenics, Inc. 2.09 14.58 27.00%
Acorda Therapeutics, Inc. 1.63 14.58 27.00%
Vericel Corporation 2.59 14.58 27.00%
Verastem, Inc. 2.17 14.58 27.00%
ChemoCentryx, Inc. 2.22 14.58 27.00%
Merrimack Pharmaceuticals, Inc. 1.84 14.58 27.00%
Concert Pharmaceuticals, Inc. 1.19 14.58 27.00%
Emergent BioSolutions Inc. 1.31 14.58 27.00%
Heat Biologics, Inc. 1.16 14.58 27.00%
Veracyte, Inc. 1.06 14.58 27.00%
Average% 14.58 27.00%
Average 1.61 0.1458 27.00%
Biogen% 10.62% 27.00%
Biogen 0.88 0.11 27.00%

The comparable firms have been chosen

Levered Beta (Industry) 1.61 casually among the same industry of our
company "Drugs (Biotechnology)" in order to
Unlevered Beta (Industry) 1.45 eliminate all bias caused by the self selection
Biogen ~ Beta (Unlevered) 1.45 methods.
Biogen ~ Beta (Levered) 1.57
company "Drugs (Biotechnology)" in order to
eliminate all bias caused by the self selection
methods.
Current accounting data Value
Current EBIT 7,359.80
Current interest expenses 187.40
Current leasing expenses 0
Book value of debt 4,459.90
The current leasing expen
capitalized by the compan
they aren’t considered as
Modified interest coverage ratio 39.27
Associated default spread 0.63%
Pre-tax Kd 1.33% All the datas have been taken fro
After-tax Kd 1% Biogen annual report, while the m
tax rate has been taken from the
Damodaran website (as for ERP)
http://pages.stern.nyu.edu/~adamoda
Year Future leases commitment
2020 87.6
2021 81.5
2022 75.7
2023 72.5
2024 69
After 158.3

Avarage yearly lease commit. 77.26

From 2020 to 2024
Since we have a value of 158,3 we need to add (158,3/77,26) = 2 years approximated

Year Future leases commitment

2020 87.6
2021 81.5
2022 75.7
2023 72.5
2024 69
2025 77.26
2026 77.26

Adjusted EBIT 7,359.80

Current EBIT 7,359.80
Current leasing expences 0.00
Current year amortization 0.00

Adjusted Mkt value debt 6,599.95

Book value of debt 4,459.90

Interest expence 187.40
Maturity 13.74
Pre-tax Kd 1.33%
 Long-term debt Maturity
Senior notes due 2022 1,038.90 2022
Senior notes due 2025 1,897.20 2025
Senior notes due 2045 2,107.90 2045
5,044.00

Years Debt W.A. Maturity

3 1,038.90 20.60%
6 1,897.20 37.61%
26 2,107.90 41.79%
5,044.00 100.00%

Maturity Interest expense Pre-tax Kd

1 187.40 1.33%
2 187.40 1.33%
3 187.40 1.33%
4 187.40 1.33%
5 187.40 1.33%
6 187.40 1.33%
7 187.40 1.33%
8 187.40 1.33%
9 187.40 1.33%
10 187.40 1.33%
11 187.40 1.33%
12 187.40 1.33%
13 187.40 1.33%
14 187.40 1.33%
14 4,459.90 1.33%

Another way to calculate the exact present value of debt with more accuracy consists in not approximating the "W.A. Maturity":
 Other data value
Risk free rate 0.70%
Marginal tax rate 27%

The current leasing expenses are

For developed market firms with market cap > $5 billion
capitalized by the company and so
If interest coverage ratio is
they aren’t considered as costs.
> ≤ to Rating is
8.50 100000 Aaa/AAA
All the datas have been taken from the 2019 6.5 8341.19.00 Aa2/AA
Biogen annual report, while the marginal 5.5 8339.19.00 A1/A+
tax rate has been taken from the Aswath 4.25 8338.19.00 A2/A
Damodaran website (as for ERP) 3 4170.39.00 A3/A-
http://pages.stern.nyu.edu/~adamodar/.
2.5 16668.39.00 Baa2/BBB
2.25 4168.39.00 Ba1/BB+
2 41668.39.00 Ba2/BB
2.15 16667.39.00 B1/B+
1.5 12500.59.00 B2/B
1.25 8334.19.00 B3/B-
0.8 4167.39.00 Caa/CCC
1.05 13333.19.00 Ca2/CC
0.2 10833.19.00 C2/C
-100000 3333.19.00 D2/D

Future leases commit. Discount rate Present value of lease

2020 87.6 1.33% 86.45
2021 81.5 1.33% 79.37
2022 75.7 1.33% 72.76
2023 72.5 1.33% 68.77
2024 69 1.33% 64.59
2025 77.26 1.33% 71.37
2026 77.26 1.33% 70.43
513.75
 Year
3
6
26

W.A. Maturity
0.62
2.26
10.87
13.74

Pv of debt
184.94
182.51
180.12
177.75
175.42
173.12 Shares (mln) 174.06
170.85 Current stock price 319.21
168.60 TOTAL mkt value of equity 55,562.97
166.39
164.21
162.05 Mkt value of debt 6,086.20
159.92 PV operating leasing 513.75
157.82 TOTAL mkt value of debt 6,599.95
155.75
3706.74
6086.20

t approximating the "W.A. Maturity": 6058.67

market cap > $5 billion

Spread is
0.63%
0.78%
0.98%
1.08%
1.22%
1.56%
2.00%
2.40%
3.51%
4.21%
5.15%
8.20%
8.,64%
11.34%
15.12%
Marginal tax rate 27%
Beta levered 1.57
ERP 5.20%
CRP 0.37%
Risk free rate 0.70%
Cost of equity 9.44%
Market value of equity 55,562.97
After-tax Cost of debt 1%
Market value of debt 6,599.95
WACC 8.54%
To obtain the KE I used the
CAPM’s model, taking into
consideration the CRP value.
 Year R&D exp. Accumulated Dep. 31/12/19 Unamortized Portion 31/12/2019 Amortization 31/12/19
% % %
2019 (TTM) 2193.20 10.00% 219.32 90.00% 1973.88 10.00% 219.32
2018 2597.20 20.00% 519.44 80.00% 2077.76 10.00% 259.72
2017 2253.60 30.00% 676.08 70.00% 1577.52 10.00% 225.36
2016 1973.30 40.00% 789.32 60.00% 1183.98 10.00% 197.33
2015 2012.80 50.00% 1006.40 50.00% 1006.40 10.00% 201.28
2014 1893.42 60.00% 1136.05 40.00% 757.37 10.00% 189.34
2013 1444.05 70.00% 1010.84 30.00% 433.22 10.00% 144.41
2012 1334.92 80.00% 1067.94 20.00% 266.98 10.00% 133.49
2011 1219.60 90.00% 1097.64 10.00% 121.96 10.00% 121.96
2010 1248.60 100.00% 1248.60 0.00% 0.00 10.00% 124.86
9399.07 1817.07

R&D Expenses $ 2,193.20

Operating Income $ 7,359.80
Net Income $ 5,872.30
BV Equity $ 12,536.90
BV Capital $ 26,119.20

ADJ Operating Income $ 7,735.93

ADJ Net Income $ 6,248.43
ADJ BV Equity $ 21,935.97
ADJ BV Capital $ 35,518.27
 Datas taken from the company's Annual report of the last 10 Ye
Acquisitions of 2020 2019 2018 2017 2016 2015
intangible assets 155 3 975.4 111.6 15.4
Purchases of property,
plant and equipment 514.5 770.6 867.4 616.1 643

Acquired in process,
research &
development - 112.5 120 - -
D&A 680.6 1016.6 1081 682.7 600.4
R&D 2,193.20
Fumapharm AG
acquisition 300 1500 1200 1200 850
Acquisition of Nightstar
Therapeutics 744.4
Purchase of Ionis
Pharmaceuticals, Inc.
stock 462.9

Year CAPEX Year D&A Year

2015 658.4 2010 355.744 2015
2016 727.7 2011 358.933 2016
2017 1,962.80 2012 365.648 2017
2018 886.10 2013 531.7 2018
2019 (current) 669.50 2014 688.1 2019 (current
Average 980.90 2015 600.4 Average
2016 682.7
2017 1081
2018 1016.6
2019 (current) 680.6
Average 636.1425

NET CAPEX 344.76

Adjusted CAPEX 3,174.10
Adjusted D&A 2,453.21
Adjusted NET CAPEX 1,972.35
s Annual report of the last 10 Years
2014 2013 2012 2011 2010 2009 2008 2007
- - 72.401 5 84.952

287.8 246.3 254.55 208.02 173.06 165.646 275.954 284.106

688.1 531.7 365.65 358.93 355.74 427.961 462.059 380.293

Acquisition
850
1200
1200
1962.9
1044.4
1251.46
 Datas taken from the company's Balance Sheet of the last 6 Years

2019 2018 2017 2016 2015 2014

Account receivables 1880.5 1985.5 1787 1441.6 1227 1292.4
Inventory 804.2 929.9 902.7 1001.6 893.4 804
Account payables 530.8 370.5 395.5 279.8 267.4 229.2
Total revenues 14377.9 13452.9 12273.9 11448.8 10763.8

2019 2018 2017 2016 2015 His.Average

Ch. Receivables -105 198.5 345.4 214.6 -65.4
Ch. Inventory -125.7 27.2 -98.9 108.2 89.4
Ch. Payables 160.3 -25 115.7 12.4 38.2
Ch. NonCash WC $ -391.00 $ 250.70 $ 130.80 $ 310.40 $ -14.20 $ 57.34
F.Revenues $ 14,377.90 $ 13,452.90 $ 12,273.90 $ 11,448.80 $ 10,763.80
WC as % of revenues -2.72% 1.86% 1.07% 2.71% -0.13% 0.56%

WC as % of revenues (average) $ 80.20

13.1% 13.1%
WC as % of revenues
(Industry) $ 1,889.26 $ 1,767.71
$ 121.55
 Damodaran website's value

Non-cash WC/ Sales (industry) 13.14%

Ch. NonCash WC $ 80.20
Adj. Capex $ 3,174.10
Adjusted D&A 2,453.21
Acquisition 1251.46

+Capex $ 3,174.10
+ Acquisition 1251.46
-D&A $ 2,453.21
+Ch.WC $ 80.20
Reinvestment Needs $ 2,052.55

Reinvestment Needs $ 2,052.55

Op. income $ 7,735.93
Tax rate 27.00%
Reinvestment Rate 36%

Adj. Op. income $ 5,647.23

* 1-Reinvestment Rate 64%
FCFF $ 3,594.68
Year Long term debt Mkt value of equity DR
2015 6,521.50 79,000.13 8%
2016 6,512.70 64,000.95 9%
2017 5,935.00 63,000.13 9%
2018 5,936.50 72,000.40 8%
2019 (current) 4,459.00 62,000.58 7%
1%

Equity Reinvestment Needs $ 1,914.84 Since volatility isn't high, it can

Reinvestment Needs $ 2,052.55 measure the FCFE

Debt/Capital 6.71%

FCFE $ 4,333.59
Net Income $ 6,248.43
Equity Reinvestment Needs $ 1,914.84
Op. income $ 5,647.23 Net income 6,248.43
BV equity 12,536.9 BV equity 12,536.9
BV debt 4,459.90 ROE 50%
Cash 3,860.40 R&D asset 9,399.07
ROC 43% Adj. ROE 28%
R&D asset 9,399.07
Adj. ROC 25%

ROC decomposition ROE decomposition

Return On Sales (ROS) 39% ROC 43%
Aftertax Op. income $ 5,647.23 1+D/E 1.05
Sales 14,377.90 IC 13,136.40
Sales to Capital ratio 1.09 Equity 12,536.9
Sales 14,377.90 1+NI/Fin. Exp. 1.11
IC 13,136.40 Net income 6,248.43
Aftertax Op. Inc. $ 5,647.23

GORDON GROWTH MODEL

HIGH-GROWTH PERIOD
Exp. Growth 9.1% 9.1% 9.1% 9.1% 9.1%
Year 1 2 3 4 5
EBIT (1-tax rate) 6161.5830464 6722.784982 7335.1016405074 8003.188593 8732.125441
Reinvestment Needs 2239.4963749 2443.471504 2666.024852674 2908.848539 3173.788801
FCFF 3922.0866715 4279.313477 4669.0767878333 5094.340054 5558.33664
WACC 8.54% 8.54% 8.54% 8.54% 8.54%
PV FCFF 3613.5661313 3329.314541 3067.422847098 2826.132169 2603.821981
Sum of PV FCFF 15440.2576688119
TV 131121.46
PV of TV 87049.8176884703
Value of Operating asset 102490.08

HIGH-GROWTH PERIOD
Exp Growth 8.7% 8.7% 8.7% 8.7% 8.7%
Year 1 2 3 4 5
Net income 6793.8683874 7386.91922 8031.7386882735 8732.845782 9495.153965
Equity reinv. Rate 31% 31% 31% 31% 31%
FCFE 679356% 738661% 803143% 873254% 949485%
Ke 9% 9.44% 9.44% 9.44% 9.44%
PV FCFE 620776% 567247% 518333% 473638% 432796%
Sum of PV FCFE 26,127.89
TV 129430.71
PV of TV 82456.149467425
Value of Equity 108584.04

Equity side Valuation

Value of Equity
(enterprise value) 108584.04
+Cash & cash equivalent 2913.7
+Marketable securities 1562.2
-Noncontrolling interest -25.42
+Investments in other asse 7767.36
Value of Firm 120801.88
Investments in
-Mkt value of debt 6,599.95 otherto
Price asset
book 1252.8
Value of equity 114201.93 ratio_ind
Mkt value of 6.2
/ #share 174.06 investments 7767.36
Value per share 656.09

Value per share 656.09

Current stock price 319.21
Reinvestment Rate 36% Equity reinv. Need $ 1,914.84
Adj. ROC 25% Net income $ 6,248.43
Growth O.I. 9.1% Equity Reinv. Rate 31%
Adj. ROE 28%
Growth N.I. 8.7%

Stable-Growth Input
Stable-Growth Rate 0.70%
Beta levered 1.2
Default spread 0.00%
Ke 7.4%
Wacc 6.7%
Stable ROC 6.7%
Stable ROE 7.4%
Reinvestment rate 10.4%
Equity Reinvestment Rate 9.5%
EBIT (1-tax rate) year 6 8793.25
FCFF in year 6 7875.40
Net income year 6 9561.62
FCFFE in year 6 8655.61
Terminal Value (Asset) 131121.46
Terminal Value (Equity) 129430.71

Noncontrolling interest -4.1

Price to book ratio 6.2
Mkt value of Noncontrolling interest -25.42

STRATEGY
Value per share < Price, so BUY/HOLD
 SAMPLE OF COMPANIES
INDUSTRY COMPANY Beta P/Eps ratio ttmPayout ratio Exp growth rate (5year

Drugs (Biotechnology) Biogen 0.51 10.07 0 0.18

Drugs (Biotechnology) Amgen 1.38 18.6 77.39.00 9.54
Drugs (Biotechnology) Gilead Sciences, Inc. 1.13 20.03 10.59.00 3.04
Drugs (Biotechnology) Regeneron Pharmaceuticals, Inc. 0.53 4.58 0 11.13
Drugs (Biotechnology) Seattle Genetics, Inc. 1.4 0 8.06
Drugs (Biotechnology) Repligen Corporation 1.05 297.58.00 0 0.22
Drugs (Biotechnology) Vertex Pharmaceuticals Incorporated 1.31 48.4 0 15.47
Drugs (Biotechnology) Alnylam Pharmaceuticals, Inc. 2.29 0 76.49.00
Drugs (Biotechnology) Alexion Pharmaceuticals, Inc. 1.41 9.51 0 2.11.00
Drugs (Biotechnology) Global Blood Therapeutics, Inc. 2.36 0 0.37
Drugs (Biotechnology) UroGen Pharma Ltd. 2.11 0
Drugs (Biotechnology) AbbVie Inc. 1.18 16.29 12.57 8.07
Drugs (Biotechnology) Abeona Therapeutics Inc. 1.58 0
Drugs (Biotechnology) ACADIA Pharmaceuticals Inc 2.22 0 0.25
Drugs (Biotechnology) Xencor, Inc. 1.01 0
Drugs (Biotechnology) Bellicum Pharmaceuticals, Inc. 0
Drugs (Biotechnology) Flexion Therapeutics, Inc. 2.06 0 0.2
Drugs (Biotechnology) Jounce Therapeutics, Inc. 2.37 4.05 0
Drugs (Biotechnology) XOMA Corporation 1.21 0 0.19
Drugs (Biotechnology) AquaBounty Technologies, Inc. 1.27 0
Drugs (Biotechnology) Calithera Biosciences, Inc. 2.35 0 1.15
Drugs (Biotechnology) Editas Medicine, Inc. 2.39 0
Drugs (Biotechnology) Palatin Technologies, Inc. 1.54 3.32 0
Drugs (Biotechnology) Bio-Path Holdings, Inc. 3.01 0
Drugs (Biotechnology) DiaMedica Therapeutics Inc. 2.14 0
Drugs (Biotechnology) Orgenesis Inc. 2.01 0
Drugs (Biotechnology) Organovo Holdings, Inc. 1.01 0
Drugs (Biotechnology) Aeglea BioTherapeutics, Inc. 2.06 0
Drugs (Biotechnology) Eiger BioPharmaceuticals, Inc. 0
Drugs (Biotechnology) Novavax, Inc. 1.22 0
Drugs (Biotechnology) ZIOPHARM Oncology, Inc. 2.48 0
Drugs (Biotechnology) Fate Therapeutics, Inc. 2.15 0
Drugs (Biotechnology) Zafgen, Inc. 0
Drugs (Biotechnology) Calyxt, Inc. 2.45 0
Drugs (Biotechnology) Galectin Therapeutics, Inc. 2.45 0
Drugs (Biotechnology) Yield10 Bioscience, Inc. 2.9 0
Drugs (Biotechnology) XBiotech Inc. 1.51 1.39 0
Drugs (Biotechnology) Voyager Therapeutics, Inc. 2.31 0
Drugs (Biotechnology) VistaGen Therapeutics, Inc. 0.00 0
Drugs (Biotechnology) DelMar Pharmaceuticals, Inc. 1.43.00 0
Drugs (Biotechnology) Viking Therapeutics, Inc. 2.04 0 0.4
Drugs (Biotechnology) MacroGenics, Inc. 2.15 0 -0.66
Drugs (Biotechnology) Acorda Therapeutics, Inc. 2.02 0 0.29.00
Drugs (Biotechnology) Vericel Corporation 3.39 0
Drugs (Biotechnology) Verastem, Inc. 0 2.54
Drugs (Biotechnology) ChemoCentryx, Inc. 2.06 0
Drugs (Biotechnology) Merrimack Pharmaceuticals, Inc. 0 0.56
Drugs (Biotechnology) Concert Pharmaceuticals, Inc. 1.32 0
Drugs (Biotechnology) Emergent BioSolutions Inc. 1.25 64.36.00 0 1.32
Drugs (Biotechnology) Heat Biologics, Inc. -0.01 0
Drugs (Biotechnology) Veracyte, Inc. 1.28.00 0
Drugs (Pharmaceutical) Notis Global, Inc. -0.03 0
Drugs (Pharmaceutical) Rock Creek Pharmaceuticals, Inc. 3.04.00 0
Drugs (Pharmaceutical) American Green, Inc. -0.07 0
Drugs (Pharmaceutical) Onconova Therapeutics, Inc. 2.03.00 0
Drugs (Pharmaceutical) Gala Pharmaceutical, Inc. -0.05 0
Drugs (Pharmaceutical) Petlife Pharmaceuticals, Inc. 2.48.00 0
Drugs (Pharmaceutical) Tetraphase Pharmaceuticals, Inc. 0 9.24
Drugs (Pharmaceutical) Hepion Pharmaceuticals, Inc. 1.6 0
Drugs (Pharmaceutical) Spotlight Innovation Inc. 0
Drugs (Pharmaceutical) Aeolus Pharmaceuticals, Inc. 2 0
Drugs (Pharmaceutical) Titan Pharmaceuticals, Inc. 1.26 0
Drugs (Pharmaceutical) BioPharmX Corporation 0
Drugs (Pharmaceutical) RespireRx Pharmaceuticals Inc. 0
Drugs (Pharmaceutical) Aradigm Corporation 0

New sample of companies added, but nobody of these have a values of P/E ratio

Drugs (Biotechnology) Syros Pharmaceuticals, Inc.

Drugs (Biotechnology) T2 Biosystems, Inc.
Drugs (Biotechnology) Tauriga Sciences, Inc.
Drugs (Biotechnology) Synthetic Biologics, Inc.
Drugs (Biotechnology) Synthorx, Inc.
Drugs (Biotechnology) Syros Pharmaceuticals, Inc.
Drugs (Biotechnology) Taxus Cardium Pharmaceuticals Group, Inc.
Drugs (Biotechnology) TCR2 Therapeutics Inc.
Drugs (Biotechnology) Teligent, Inc.
Drugs (Biotechnology) Tenax Therapeutics, Inc.
Drugs (Biotechnology) Tengion, Inc.
Drugs (Biotechnology) TetraLogic Pharmaceuticals Corporation
Drugs (Biotechnology) TG Therapeutics, Inc.
Drugs (Biotechnology) Tonix Pharmaceuticals Holding Corp.
Drugs (Biotechnology) TRACON Pharmaceuticals, Inc.
Drugs (Biotechnology) Translate Bio, Inc.
Drugs (Biotechnology) Trevena, Inc.
Drugs (Biotechnology) TrovaGene, Inc.
Drugs (Biotechnology) Turning Point Therapeutics, Inc.
Drugs (Biotechnology) Twist Bioscience Corporation
Drugs (Biotechnology) U.S. Stem Cell, Inc.
Drugs (Biotechnology) Ultragenyx Pharmaceutical Inc.
Drugs (Biotechnology) United Therapeutics Corporation
Drugs (Biotechnology) Unity Biotechnology, Inc.
Drugs (Biotechnology) Unum Therapeutics Inc.
Drugs (Biotechnology) USA Equities Corp.
Drugs (Biotechnology) Vaccinex, Inc.
Drugs (Biotechnology) Vanda Pharmaceuticals Inc.
Drugs (Biotechnology) Vaxart, Inc.
Drugs (Biotechnology) VBI Vaccines Inc.
Drugs (Biotechnology) VIA Pharmaceuticals, Inc.
Drugs (Biotechnology) Viela Bio, Inc.
Drugs (Biotechnology) Viropro Inc.
Drugs (Biotechnology) Vitro Diagnostics, Inc.
Drugs (Biotechnology) vTv Therapeutics Inc.
Drugs (Biotechnology) Windtree Therapeutics, Inc.
Drugs (Biotechnology) X4 Pharmaceuticals, Inc.
Drugs (Biotechnology) Xeno Transplants Corporation
Drugs (Biotechnology) Y-mAbs Therapeutics, Inc.
St. deviation eps ROE Price/Book ratio Price/Sales ttm Debt (in million) D/E ratio

62.54.00 7.26 4.27 4.02 6370.00.00 51.17.00

71.05.00 12.36 2.00 6.23 32.25.00 336.17.00
26.19.00 3.43 8.30.00 4.15 24100.00.00 109.05.00
151.01.00 3.31 8.20 18.20 715.12.00 6.29.00
82.44.00 -0.14 1.50 20.10 75.26.00 4.24
15.46.00 0.27.00 18.50.00 31.10.00 266.24.00 1.29
3.39 4.30 20.00 23.10.00 533.35.00 8.25.00
-0.43 2.00 0.20 305.22.00 22.58
-1.38 3.41.00 16.50.00 9.20.00 2850.00.00 0.24
46.49.00 -0.37 20.30 6.10 158.02.00 30.18.00
-2.35 -0.43 11.40 30441.0 4.30.00 2.59.00
22.44.00 17.10 10.00
-4.06 -0.59 16.30 8.11.00 6.23
17.18.00 -0.31 20.30 35.40.00 6.09 1.35
-0.29 -0.07 6.00 32.00.00 10.18 2.12
-5.38 -0.20 12.14 16.05
1.14.00 -0.80 9.50 224.50.00
-0.18 5.46.00 2.20 4.20 19.10.00 12.52
29.14.00 -0.21 15.40 7.30 8.06 6.38
15.01.00 -0.30 3.50 785.50.00 4.58.00 13.10.00
1.57 -0.54 8.10 8.19 6.10
37.32.00 14.00 64.40.00 5.08 11.08
-4.93 10.53 3.10 13.00.00 0.17.00 0.19
-4.75 -0.54 14.10 0.42 2.37
93.45.00 -0.60 20.20 0.18 2.34
102.58.00 8.10 10.50 12.35 4.36
-2.86 -0.49 7.30 6.40
15.54.00 -0.04 9.00 5.17 12.07
 14.01 -0.36 12.10 8.32 3.18
19.15 192.00.00 332.28.00
-2.57 -0.67 11.30 2.19.00 1.22
90.28.00 -0.31 12.50 217.00.00 3.33 11
-4.66 -0.37 10.10 21.18.00 41.34.00
-4.93 -0.43 14.40 19.40 18.55 35.32.00
-2.72 -0.35 14.10 1.31 0.2
-5.90 -0.71 14.50 4.22
99.38.00 12.18.00 13.20
-3.17 -0.31 18.20 19.10 33.39.00 42.27.00
-3.19 -0.79 4.18.00
-0.46 -0.63 26.20.00
-0.95 -0.08 16.50.00 9.48 0.22
69.05.00 -0.41 18.50 33.10.00 29.7 15.59
-6.44 -0.37 2.10 3.40.00 250.26.00 81.6
-0.04 -0.08 11.10 16.40 27.26.00 25.08.00
20.34.00 -0.33 9.50 21.50 59.06.00 48.02.00
22.56 -0.30 15.50 17.10 22.26.00 33.11.00
-1.63 -0.22
-1.44 -0.35 12.40 3318.17.00 16.56 11.12
154.09.00 1.06.00 9.20 7.20.00 827.3 5.37
-0.02 -0.65 9.40 2.00 2.33 15.05.00
11.39.00 -0.10 17.40 24.50.00 13.33 6.18
-0.5 1.26.00 0.37
0.08 15.09.00
-6.83 1223.36.00 3.15
-6.27 -0.46 2.43 33.50.00
-0.61 84.03.00
1 1336.05.00
-5.99 -0.31 9.20 16.50 3.09.00 10.18
-5.52 -0.49 6.50 4.34 6.05
-0.77 7.40
-2.04 -0.64 5.30.00 14.20
-5.59 -0.81 20.30 20.10 4.44 310.31.00