Final production commitments from a site in Hillerød, Denmark since sold to Fujifilm brought in $230 million in contract manufacturing revenues for Biogen in 2023.

Dan Stanton, Managing editor

February 15, 2024

2 Min Read

For the full year 2023, Biogen reported sales of $9.8 billion, down 3% year-on-year due in part to reduced sales from the firm’s multiple sclerosis products.

Rare disease and biosimilar sales remained relatively flat, but one segment that grew over the past 12 months was Biogen’s contract manufacturing business, which pulled in $899 million – up 85%.

But this growth is a one-off, CFO Mike McDonnell said on its conference call, attributing the jump to “completing certain batch commitments in 2023, as part of the 2020 sale of Hillerød.”

Biogen announced the sale of the Denmark site to contract development and manufacturing organization (CDMO) Fujifilm Diosynth Biotechnologies in 2019, with the deal closing the following year. As part of the sale, Biogen provided Fujifilm certain minimum batch production commitment guarantees, including batches related to its contract manufacturing arrangements.

“We had manufacturing operations there, and these batch commitments contributed roughly $320 million in 2023, which will not recur in 2024,” McDonnell said. In its regulatory 10-K filing, the firm confirms it is “no longer supplying contract manufacturing customers in this manner.”

The filing also notes Biogen continues to produce some drug substance products for others from its RTP, North Carolina site. The site also makes Biogen’s own products, including Avonex (interferon beta-1a), Plegridy (peginterferon beta), Tysabri (natalizumab), and Qalsody (tofersen).

Biogen also includes certain sales of approved Alzheimer’s drug Leqembi (lecanemab) – made from its Solothurn, Switzerland site – to its partner Eisai within its CDMO business.

Despite the expected decline in CDMO sales, McDonnell expects new product launches and lower idle capacity charges to have a favorable impact on cost of sales as a percentage of revenue for 2024.

“We also believe we can grow our operating income at a low-double-digit percentage and operating margins by a mid-single-digit percentage, as compared to 2023. We expect this to be driven by improved cost of sales as a percentage of revenue, as well as lower expected operating expenses, resulting from our Fit for Growth initiative.”

About the Author(s)

Dan Stanton

Managing editor

Journalist covering the international biopharmaceutical manufacturing and processing industries.

Founder and editor of Bioprocess Insider, a daily news offshoot of publication Bioprocess International, with expertise in the pharmaceutical and healthcare sectors, in particular, the following niches: CROs, CDMOs, M&A, IPOs, biotech, bioprocessing methods and equipment, drug delivery, regulatory affairs and business development.

From London, UK originally but currently based in Montpellier, France through a round-a-bout adventure that has seen me live and work in Leeds (UK), London, New Zealand, and China.

You May Also Like