XML 30 R9.htm IDEA: XBRL DOCUMENT
v3.22.2.2

Collaboration, License, and Other Agreements | 9 Months Ended
--- | ---
Sep. 30, 2022
Revenue from Contract with Customer [Abstract] |
Collaboration, License, and Other Agreements | Collaboration, License, and Other Agreements a. Sanofi Amounts recognized in our Statements of Operations in connection with our collaborations with Sanofi are detailed below:
|  | Statement of Operations Classification |  | Three Months Ended September 30, |  | Nine Months Ended September 30,
(In millions) |  |  | 2022 |  | 2021 |  | 2022 |  | 2021
Antibody: |  |  |  |  |  |  |  |  |  |
Regeneron's share of profits in connection with commercialization of antibodies |  | Collaboration revenue |  | $ | 551.1 | * |  | $ | 387.0 |  |  | $ | 1,463.0 | * |  | $ | 975.2 |
Sales-based milestone earned |  | Collaboration revenue |  | $ | — |  |  | $ | 50.0 |  |  | $ | 50.0 |  |  | $ | 50.0 |
Reimbursement for manufacturing of commercial supplies |  | Collaboration revenue |  | $ | 160.5 |  |  | $ | 144.7 |  |  | $ | 466.8 |  |  | $ | 361.2 |
Other |  | Collaboration revenue |  | $ | (0.2) |  |  | $ | — |  |  | $ | 28.7 |  |  | $ | — |
(Regeneron's obligation for its share of Sanofi R&D expenses)/reimbursements of R&D expenses, net |  | (R&D expense)/reduction of R&D expense |  | $ | (4.3) |  |  | $ | 34.9 |  |  | $ | 59.6 |  |  | $ | 89.5 |
Reimbursement of commercialization-related expenses |  | Reduction of SG&A expense |  | $ | 108.6 |  |  | $ | 79.0 |  |  | $ | 311.1 |  |  | $ | 216.9 |
Immuno-oncology: |  |  |  |  |  |  |  |  |  |
Regeneron's share of profits (losses) in connection with commercialization of Libtayo outside the United States |  | Collaboration revenue |  | $ | — |  |  | $ | (3.0) |  |  | $ | 6.7 |  |  | $ | (12.6) |
Reimbursement for manufacturing of ex-U.S. commercial supplies |  | Collaboration revenue |  | $ | — |  |  | $ | 3.1 |  |  | $ | 4.6 |  |  | $ | 10.5 |
Reimbursement of R&D expenses |  | Reduction of R&D expense |  | $ | — |  |  | $ | 21.8 |  |  | $ | 42.7 |  |  | $ | 66.2 |
Reimbursement of commercialization-related expenses |  | Reduction of SG&A expense |  | $ | — |  |  | $ | 22.8 |  |  | $ | 41.4 |  |  | $ | 62.0 |
Regeneron's obligation for its share of Sanofi commercial expenses |  | SG&A expense |  | $ | — |  |  | $ | (9.4) |  |  | $ | (19.9) |  |  | $ | (28.0) |
Regeneron's obligation for Sanofi's share of Libtayo U.S. gross profits |  | Cost of goods sold |  | $ | — |  |  | $ | (34.6) |  |  | $ | (70.1) |  |  | $ | (99.4) |
Amounts recognized in connection with up-front payments received |  | Other operating income |  | $ | — |  |  | $ | (47.7) |  |  | $ | 35.1 |  |  | $ | (4.1) |
* Net of one-time payment of $56.9 million to Sanofi in connection with the amendment to the Antibody License and Collaboration Agreement described below
Antibody The Company is party to a global, strategic collaboration with Sanofi to research, develop, and commercialize fully human monoclonal antibodies (the "Antibody Collaboration"), which currently consists of Dupixent® (dupilumab), Kevzara® (sarilumab), and itepekimab. Under the terms of the Antibody License and Collaboration Agreement, Sanofi is generally responsible for funding 80% to 100% of agreed-upon development costs. We are obligated to reimburse Sanofi for 30% to 50% of worldwide development expenses that were funded by Sanofi based on our share of collaboration profits from commercialization of collaboration products. Under the terms of the Antibody License and Collaboration Agreement, we were required to apply 10% of our share of the profits from the Antibody Collaboration in any calendar quarter to reimburse Sanofi for these development costs. On July 1, 2022, an amendment to the Antibody License and Collaboration Agreement became effective, pursuant to which the percentage of Regeneron’s share of profits used to reimburse Sanofi for such development costs increased from 10% to 20%. A portion of the value associated with the increase in reimbursement percentage was deemed to be contingent consideration attributable to the Company's acquisition of the Libtayo rights described within the "Immuno-oncology" section below; this portion will be recorded as an increase to the Libtayo intangible asset over time as the Company repays such development costs to Sanofi. Sanofi leads commercialization activities for products under the Antibody Collaboration, subject to the Company's right to co-commercialize such products. In addition to profit and loss sharing, the Company is entitled to receive sales milestone payments from Sanofi. During the three months ended March 31, 2022, the Company earned a $50.0 million sales-based milestone from Sanofi, upon aggregate annual sales of antibodies outside the United States (including Praluent) exceeding $2.0 billion on a rolling twelve-month basis. During the three months ended September 30, 2021, the Company earned a $50.0 million sales-based milestone from Sanofi, upon aggregate annual sales of antibodies outside the United States (including Praluent) exceeding $1.5 billion on a rolling twelve-month basis. We are entitled to receive up to an aggregate of $100.0 million in additional sales milestone payments from Sanofi, which includes the next sales milestone payment of $50.0 million that would be earned when such sales outside the United States exceed $2.5 billion on a rolling twelve-month basis. The following table summarizes contract balances in connection with the Company's Antibody Collaboration with Sanofi:
|  | September 30, |  | December 31,
(In millions) |  | 2022 |  | 2021
Accounts receivable, net |  | $ | 770.0 |  |  | $ | 504.8 |
Deferred revenue |  | $ | 476.2 |  |  | $ | 368.7 |
Immuno-oncology The Company was previously a party to a collaboration with Sanofi for antibody-based cancer treatments in the field of immuno-oncology (the "IO Collaboration"). Under the terms of the Immuno-oncology License and Collaboration Agreement, the parties were co-developing and co-commercializing Libtayo. The parties shared equally, on an ongoing basis, development and commercialization expenses for Libtayo. The Company had principal control over the development of Libtayo and led commercialization activities in the United States, while Sanofi led commercialization activities outside of the United States. The parties shared equally in profits and losses in connection with the commercialization of Libtayo. Effective July 1, 2022, the Company obtained the exclusive right to develop, commercialize, and manufacture Libtayo worldwide under an Amended and Restated Immuno-oncology License and Collaboration Agreement with Sanofi (the "A&R IO LCA"). Consequently, in July 2022, the Company made a $900.0 million up-front payment to Sanofi, and Sanofi is eligible to receive a $100.0 million regulatory milestone and up to an aggregate of $100.0 million in sales-based milestones upon achieving certain amounts of worldwide net product sales of Libtayo through 2023. The Company will also pay Sanofi an 11% royalty on net product sales of Libtayo through March 31, 2034. The transaction was accounted for as an asset acquisition and amounts paid to Sanofi in connection with obtaining the worldwide rights to Libtayo, including the up-front payment and any contingent consideration, are recorded as an intangible asset. See Note 8 for additional information related to the intangible asset recorded in connection with the transaction. In accordance with the Amended and Restated Immuno-oncology Discovery and Development Agreement, the Company was obligated to reimburse Sanofi for half of the development costs it funded that were attributable to clinical development of antibody product candidates from our share of profits from commercialized IO Collaboration products. Under the A&R IO LCA, the amount of development costs incurred under the IO Collaboration for which we are obligated to reimburse Sanofi was $35.0 million as of the effective date of the A&R IO LCA, and the Company pays Sanofi a 0.5% royalty on net product sales of Libtayo until all such development costs have been reimbursed by Regeneron. The following table summarizes contract balances in connection with the Company's IO Collaboration with Sanofi:
|  | September 30, |  | December 31,
(In millions) |  | 2022 |  | 2021
Accounts receivable, net |  | $ | 3.6 |  |  | $ | (22.5) |
Deferred revenue |  | $ | — |  |  | $ | 16.0 |
Other liabilities |  | $ | — |  |  | $ | 276.1 |
Other liabilities included up-front payments received from Sanofi for which recognition had been deferred. During the three months ended September 30, 2021, we updated our estimate of the total research and development costs expected to be incurred (which resulted in a change to the estimate of the stage of completion) in connection with the IO Collaboration, and, as a result, recorded a cumulative catch-up adjustment of $66.9 million as a reduction to other operating income. In connection with the A&R IO LCA described above, the remaining IO Collaboration Other liabilities balance of $241.0 million as of July 1, 2022 was recognized as a reduction to the intangible asset during the three months ended September 30, 2022. b. Bayer The Company is party to a license and collaboration agreement with Bayer for the global development and commercialization of EYLEA (aflibercept) and aflibercept 8 mg outside the United States. Agreed-upon development expenses incurred by the Company and Bayer are generally shared equally. Bayer markets EYLEA outside the United States and the companies share equally in profits and losses from sales. In Japan, the Company was entitled to receive a tiered percentage of between 33.5% and 40.0% of EYLEA net product sales through 2021, and effective January 1, 2022, the companies share equally in profits and losses from sales. Amounts recognized in our Statements of Operations in connection with our Bayer collaboration are as follows:
|  | Statement of Operations Classification |  | Three Months Ended September 30, |  | Nine Months Ended September 30,
(In millions) |  |  | 2022 |  | 2021 |  | 2022 |  | 2021
Regeneron's share of profits in connection with commercialization of EYLEA outside the United States |  | Collaboration revenue |  | $ | 315.3 |  |  | $ | 351.0 |  |  | $ | 993.4 |  |  | $ | 995.3 |
Reimbursement for manufacturing of ex-U.S. commercial supplies |  | Collaboration revenue |  | $ | 17.5 |  |  | $ | 14.0 |  |  | $ | 60.3 |  |  | $ | 41.6 |
One-time payment in connection with change in Japan arrangement |  | Collaboration revenue |  | $ | — |  |  | $ | — |  |  | $ | 21.9 |  |  | $ | — |
Reimbursement of R&D expenses |  | Reduction of R&D expense |  | $ | 11.8 |  |  | $ | 14.5 |  |  | $ | 32.7 |  |  | $ | 35.2 |
Regeneron's obligation for its share of Bayer research and development expenses |  | R&D expense |  | $ | (4.7) |  |  | $ | (8.0) |  |  | $ | (22.4) |  |  | $ | (31.4) |
The following table summarizes contract balances in connection with our Bayer collaboration:
|  | September 30, |  | December 31,
(In millions) |  | 2022 |  | 2021
Accounts receivable, net |  | $ | 323.0 |  |  | $ | 355.5 |
Deferred revenue |  | $ | 131.1 |  |  | $ | 129.4 |
c. U.S. Government In 2020 and 2021, we entered into agreements to manufacture and deliver filled and finished drug product of REGEN-COV (casirivimab and imdevimab) to the U.S. government. In connection with one of our 2021 agreements, Roche supplied a portion of the doses to Regeneron to fulfill our agreement with the U.S. government (see "Roche" section below for further details regarding our collaboration agreement with Roche). As of December 31, 2021, the Company had completed its final deliveries of drug product under its agreements with the U.S. government. See Note 2 for REGEN-COV net product sales recognized during the three and nine months ended September 30, 2021. d. Roche In 2020, we entered into a collaboration agreement (the "Roche Collaboration Agreement") with Roche to develop, manufacture, and distribute the casirivimab and imdevimab antibody cocktail (known as REGEN-COV in the United States and Ronapreve™ in other countries). Under the terms of the collaboration agreement, we lead global development activities for casirivimab and imdevimab, and the parties jointly fund certain studies. Under the terms of the agreement, each party is obligated to dedicate a certain amount of manufacturing capacity to casirivimab and imdevimab each year. We distribute the product in the United States and Roche distributes the product outside of the United States. The parties share gross profits from worldwide sales based on a pre-specified formula, depending on the amount of manufactured product supplied by each party to the market. Each quarter, a single payment is due from one party to the other to true-up the global gross profits between the parties. If Regeneron is to receive a true-up payment from Roche, such amount will be recorded to Collaboration revenue. If Regeneron is to make a true-up payment to Roche, such amount will be recorded to Cost of goods sold. Amounts recognized in our Statements of Operations in connection with the Roche Collaboration Agreement are as follows:
|  | Statement of Operations Classification |  | Three Months Ended September 30, |  | Nine Months Ended September 30,
(In millions) |  |  | 2022 |  | 2021 |  | 2022 |  | 2021
Global gross profit payment from Roche in connection with sales of Ronapreve |  | Collaboration revenue |  | $ | 6.4 |  |  | $ | 127.1 |  |  | $ | 230.9 |  |  | $ | 361.8 |
Reimbursement of research and development expenses from Roche (recorded as a reduction of Research and development expense) was $10.5 million and $138.3 million for the three and nine months ended September 30, 2021. Such amounts were not material for the three and nine months ended September 30, 2022. The following table summarizes contract balances in connection with the Roche Collaboration Agreement:
|  | September 30, |  | December 31,
(In millions) |  | 2022 |  | 2021
Accounts receivable, net |  | $ | 3.2 |  |  | $ | — |
Accrued expenses and other current liabilities |  | $ | — |  |  | $ | 268.8 |
e. Alnylam In 2018, the Company and Alnylam Pharmaceuticals, Inc. entered into a collaboration to discover RNA interference ("RNAi") therapeutics for NASH and potentially other related diseases, as well as to research, co-develop and commercialize any therapeutic product candidates that emerge from these discovery efforts (including ALN-HSD, which is currently in clinical development). The parties share equally, on an ongoing basis, development expenses for ALN-HSD. In 2019, the parties entered into a global, strategic collaboration to discover, develop, and commercialize RNAi therapeutics for a broad range of diseases by addressing therapeutic disease targets expressed in the eye and central nervous system ("CNS"), in addition to a select number of targets expressed in the liver. For each program, we provide Alnylam with a specified amount of funding at program initiation and at lead candidate designation. Following designation of a lead candidate, the parties may further advance such lead candidate under either a co-commercialization collaboration agreement structure (under which the parties are advancing ALN-APP, which is currently in clinical development) or a license agreement. In addition, during 2019, the parties entered into a Co-Commercialization Collaboration Agreement for a silencing RNA ("siRNA") therapeutic targeting the C5 component of the human complement pathway being developed by Alnylam, with Alnylam as the lead party, and a License Agreement for a combination product consisting of such siRNA therapeutic (cemdisiran) and a fully human monoclonal antibody being developed by the Company (pozelimab), with the Company as the licensee. Under the C5 siRNA Co-Commercialization Collaboration Agreement, the parties share costs equally and under the License Agreement, the licensee is responsible for its own costs and expenses. Amounts recognized in our Statements of Operations in connection with the Alnylam agreements described above were not material for the three and nine months ended September 30, 2022 and 2021. In addition, contract balances in our Balance Sheets were not material as of September 30, 2022 and December 31, 2021. f. Checkmate In May 2022, the Company completed its acquisition of Checkmate Pharmaceuticals, Inc. (“Checkmate”) for a total equity value of approximately $250 million. The Company made an assessment as to whether the set of assets acquired constituted a business and should be accounted for as a business combination. Given that substantially all of the fair value of the gross assets acquired was concentrated in a single identifiable asset, vidutolimod, which is in clinical development for oncology, the transaction was accounted for as an asset acquisition. As a result of the acquisition, the Company recorded (i) a charge of $195.0 million to Acquired in-process research and development and (ii) net assets of $35.3 million, net of cash, related to the assets acquired (including deferred tax assets and investments) and liabilities assumed. g. Teva The Company and Teva are parties to a collaboration agreement (the "Teva Collaboration Agreement") to develop and commercialize fasinumab globally, excluding certain Asian countries that are subject to our collaboration agreement with Mitsubishi Tanabe Pharma Corporation ("MTPC"). Under the terms of the Teva Collaboration Agreement, the Company leads global development activities and the parties share development costs equally. In connection with the agreement, Teva made a $250.0 million non-refundable up-front payment in 2016, and as of September 30, 2022, we had received an aggregate $120.0 million of development milestones from Teva. These amounts were initially recorded within other liabilities and were being recognized (as other operating income) over the period in which the Company was to satisfy its obligation to perform development activities. During the three months ended September 30, 2022, we discontinued further clinical development of fasinumab and, as a result, recorded $31.9 million as an increase to other operating income as we deemed our obligation to provide development services in connection with the Teva Collaboration Agreement to be complete.

X
- Definition The entire disclosure for collaborative arrangements in which the entity is a participant, including a) information about the nature and purpose of such arrangements; b) its rights and obligations thereunder; c) the accounting policy for collaborative arrangements; and d) the income statement classification and amounts attributable to transactions arising from the collaborative arrangement between participants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 808 -SubTopic 10 -Section 50 -Paragraph 1 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=6931272&loc=SL5834143-161434 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 808 -SubTopic 10 -Section 50 -Paragraph 1 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=6931272&loc=SL5834143-161434 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 808 -URI https://asc.fasb.org/topic&trid=5833765 + Details
Name: | us-gaap_CollaborativeArrangementDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | us-gaap_RevenueFromContractWithCustomerAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration