My fellow stockholders,
I am honored to write you as Biogen’s new President and Chief Executive Officer and to have joined a team that is pioneering important new medicines to address some of the most difficult and challenging conditions in healthcare. For more than 40 years, Biogen has been driven by its heritage of innovation. As we write the next chapter in our story, I see substantial opportunity to build on that strong legacy as we execute on clear priorities to put the company back on a sustainable growth trajectory.
In 2022, Biogen continued to advance therapeutic breakthroughs for patients and achieved financial performance in line with expectations, while adversely affected by increased competition in our multiple sclerosis (MS) portfolio. I step into this role with the clear understanding that we are operating in a much more competitive environment, with a cost base higher than industry benchmarks, and therefore need to transform the business to build an even stronger company for the benefit of patients, investors and other stakeholders.
We are starting that journey with some clear advantages, including being in the remarkable position of having developed two potentially transformative medicines that we believe would give us significant potential future opportunity. The first would treat Alzheimer’s disease (AD), and a second, pending U.S. Food and Drug Administration (FDA) approval, would treat depression in a new way. In 2023, we are focused on executing on these and other opportunities, while also reducing our cost base, as we build on our 2022 results.
We maintained a strong financial position last year, giving us the opportunity to invest prudently in our business. We generated more than $10.1 billion in revenue, while reducing overall expenses through our cost reduction measures.
We ended the year with approximately $5.6 billion in total cash, cash equivalents and marketable securities. Allocating that capital will be a primary focus for Biogen in 2023 as we look to rationalize our cost base and achieve a meaningful return on investment where we do invest.
I would like to thank you for your continued support of and investment in Biogen. I outline below how in 2023 we intend to execute against several priorities.
Bringing two breakthrough medicines to market
In January 2023, the FDA granted accelerated approval to LEQEMBI (lecanemab-irmb), a treatment for early AD developed in collaboration with Eisai Co., Ltd (Eisai). The accelerated approval was based on phase 2 data that demonstrated LEQEMBI reduced the accumulation of amyloid-beta (Aβ) plaque in the brain, a defining feature of AD. The data from the phase 3 CLARITY AD study provide clear evidence that reducing plaque burden slows cognitive decline. After decades of research, we can now see the promise of potential disease modification.
With potential traditional approval – the Prescription Drug User Fee Act (PDUFA) date is planned for July 6, 2023 – broader access could be within reach of more patients. The Centers for Medicare & Medicaid Services (CMS) announced its intent to provide broader coverage on the same day within the Coverage with Evidence Development framework.
We believe LEQEMBI represents a catalyst for further innovation and is an incredible opportunity to build upon as we invest in advancing the care of patients suffering with AD. We continue to see progress in the development of blood-based and digital biomarkers. We imagine a world where early detection, before the onset of symptoms, will have the potential to allow treatment much earlier in the disease course to potentially delay or even prevent AD. Biogen is committed to continuing research in AD, including investigation into a promising molecule in our pipeline which could reduce tau, another defining pathology of AD.
In collaboration with Sage Therapeutics Inc. (Sage), we have advanced zuranolone, a potential treatment for major depressive disorder (MDD) and postpartum depression (PPD). If approved, zuranolone could be an important new treatment option in an area with high unmet need.
We have all seen the surge in mental illness the last few years, and we know the current standard-of-care antidepressants may not work for everyone or may take up to six to eight weeks to reach maximal efficacy when they do. Zuranolone is currently under priority review at the FDA as a potential 14-day, rapid-acting, once-daily, oral medication to treat MDD and PPD following promising phase 3 clinical trial results. Its novel mechanism of action targets brain networks responsible for functions such as mood, arousal, behavior and cognition and could provide benefit as early as day three. With a PDUFA date set for August 5, 2023, we are anticipating a potential launch toward the end of the year in the United States, and we are building our commercial infrastructure and capabilities to enter this market.
Strengthening our portfolio and our pipeline, and improving operational efficiency
We believe our return to a sustainable growth trajectory will also require thoughtful portfolio and pipeline optimization, external growth initiatives and diligent cost management across the enterprise.
In our core business, we are working to deliver on further growth opportunities in spinal muscular atrophy (SMA) and improving our profitability in MS. We have started a review of our strategic options for our biosimilars business.
Our research and development pipeline and balance sheet are strong, and we believe our pipeline will be able to deliver significant growth over the medium and long term. But there is still more we must do to optimize our existing portfolio and diversify into new therapeutic areas such as neuropsychiatry, specialized immunology and rare diseases. We are closely examining new paths to balancing and de-risking our pipeline in a systemic and data-driven way, while sharpening our focus on value generation in the areas in which we have the most confidence, as compared to the achievement of operational milestones alone.
Through internal research and development, thoughtful business development, and disciplined capital allocation, I believe we will create new opportunities for growth.
We also have the goal of bringing our cost base in line with our revenue expectations while, at the same time, investing in upcoming launches and potential future growth drivers. We remain on track to achieve our previously announced $1.0 billion in cost-saving initiatives, and we will continue to seek new ways to create shareholder value and achieve greater operational efficiency.
Building on our heritage of innovation
As we approach the 45th anniversary of Biogen, it is a privilege to lead such an established, purpose-driven and diverse organization. I was drawn to join Biogen not only for its reputation as a biotechnology pioneer, but also by its dynamic team, which is as committed to advancing health equity as it is to pioneering patient breakthroughs. I have had the pleasure of getting to know many talented employees over the past several months and have witnessed firsthand their incredible expertise, tenacity and passion for our mission. I look forward to executing against our key milestones in 2023, with the support of the accomplished team at Biogen, our strong partnerships with collaborators like Eisai and Sage, and the continued support of our shareholders.
Sincerely,
Christopher A. Viehbacher
President and Chief Executive Officer
Read the original letter here.
