Biogen Inc. (NASDAQ:BIIB)

Biogen Inc., asset turnover by geographic area

	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
U.S.	4.19	5.70	6.37	7.95	7.13
Europe	1.13	1.09	1.25	1.39	1.50
Germany	45.76	37.22	40.96	—	—
Asia	44.19	38.86	69.76	96.77	39.00
Other	28.88	56.82	52.46	284.11	197.95

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

The asset turnover ratios across various geographic segments reveal a general trend of declining efficiency in asset utilization within primary Western markets, contrasted by high but volatile turnover in emerging or smaller regional markets.

United States and Europe: A consistent downward trajectory is observed in the primary Western regions. The U.S. market reached a peak ratio of 7.95 in 2018 before entering a period of steady decline, ending at 4.19 in 2021. Europe mirrored this contraction, decreasing from 1.50 in 2017 to a low of 1.09 in 2020, with a negligible recovery to 1.13 in 2021.
Asia and Germany: These regions maintain significantly higher turnover ratios than the U.S. and Europe, though they exhibit greater volatility. Asia saw a substantial spike in 2018 at 96.77, followed by a correction that stabilized the ratio between 38.86 and 44.19 from 2020 to 2021. Germany, with reporting beginning in 2019, showed a strong performance with ratios ranging from 37.22 to 45.76.
Other Regions: The most extreme fluctuations are evident in the Other category. This segment recorded an exceptionally high turnover of 284.11 in 2018, which was followed by a precipitous drop to 52.46 in 2019. This downward momentum continued through 2021, where the ratio fell to 28.88, indicating a significant shift in the relationship between revenue generation and asset base in these areas.

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Area Asset Turnover: U.S.

Biogen Inc.; U.S.; area asset turnover calculation

	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Selected Financial Data (US$ in thousands)
Revenues	5,832,300)	8,531,100)	9,511,500)	9,160,900)	8,742,200)
Long-lived assets	1,390,500)	1,496,300)	1,493,200)	1,152,700)	1,226,900)
Area Activity Ratio
Area asset turnover¹	4.19	5.70	6.37	7.95	7.13

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

¹ 2021 Calculation
Area asset turnover = Revenues ÷ Long-lived assets
= 5,832,300 ÷ 1,390,500 = 4.19

The analysis of U.S. operations indicates a significant decline in the efficiency of long-lived asset utilization between 2018 and 2021. While the asset base remained relatively stable, a sharp contraction in revenues led to a deterioration of the asset turnover ratio.

Revenue Performance: U.S. revenues experienced growth in the initial period, rising from US$ 8.74 billion in 2017 to a peak of US$ 9.51 billion in 2019. This trend reversed sharply thereafter, with revenues declining to US$ 8.53 billion in 2020 and falling further to US$ 5.83 billion by December 31, 2021.
Long-lived Asset Trends: The investment in long-lived assets showed less volatility than revenue. Assets decreased slightly in 2018 to US$ 1.15 billion before increasing and plateauing at approximately US$ 1.49 billion during 2019 and 2020. By the end of 2021, long-lived assets stood at US$ 1.39 billion.
Area Asset Turnover Analysis: The area asset turnover ratio reached its maximum efficiency in 2018 at 7.95. Following this peak, a consistent downward trend is observed, with the ratio falling to 6.37 in 2019, 5.70 in 2020, and 4.19 in 2021. This decline demonstrates that the company generated progressively less revenue per unit of long-lived asset, primarily because the reduction in revenue significantly outpaced any reduction in the asset base.

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Area Asset Turnover: Europe

Biogen Inc.; Europe; area asset turnover calculation

	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Selected Financial Data (US$ in thousands)
Revenues	2,635,700)	2,503,400)	2,678,000)	3,403,200)	2,913,200)
Long-lived assets	2,337,800)	2,290,200)	2,135,400)	2,442,800)	1,948,200)
Area Activity Ratio
Area asset turnover¹	1.13	1.09	1.25	1.39	1.50

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

¹ 2021 Calculation
Area asset turnover = Revenues ÷ Long-lived assets
= 2,635,700 ÷ 2,337,800 = 1.13

The financial performance in the European region between 2017 and 2021 is characterized by a decline in asset utilization efficiency. While the region experienced an initial surge in revenue, the subsequent inability to maintain those levels alongside a general increase in the long-lived asset base resulted in a downward trajectory for the area asset turnover ratio.

Revenue Trends: Revenues peaked in 2018 at 3,403,200 thousand USD, representing a significant increase from 2,913,200 thousand USD in 2017. However, a downward trend followed, with revenues falling to 2,678,000 thousand USD in 2019 and reaching a period low of 2,503,400 thousand USD in 2020. A slight recovery was noted in 2021, with revenues rising to 2,635,700 thousand USD.
Long-lived Asset Growth: The investment in long-lived assets showed a general upward trend over the five-year period. Assets increased from 1,948,200 thousand USD in 2017 to a peak of 2,442,800 thousand USD in 2018. Despite a temporary reduction to 2,135,400 thousand USD in 2019, assets grew steadily thereafter, closing at 2,337,800 thousand USD by the end of 2021.
Area Asset Turnover Analysis: The area asset turnover ratio demonstrates a consistent decline from 1.50 in 2017 to 1.09 in 2020. This contraction indicates that each unit of long-lived asset generated progressively less revenue over this timeframe. The ratio experienced a marginal improvement to 1.13 in 2021, coinciding with the slight uptick in revenues, though it remained substantially lower than the 2017 baseline.

In summary, the diverging paths of revenue and asset accumulation between 2018 and 2020 eroded the operational efficiency of the European asset base. The stabilization observed in 2021 suggests a potential inflection point, though the overall five-year trend indicates a reduced capacity to generate sales from long-term regional investments.

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Area Asset Turnover: Germany

Biogen Inc.; Germany; area asset turnover calculation

	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Selected Financial Data (US$ in thousands)
Revenues	1,162,400)	1,161,200)	1,126,400)	—)	—)
Long-lived assets	25,400)	31,200)	27,500)	—)	—)
Area Activity Ratio
Area asset turnover¹	45.76	37.22	40.96	—	—

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

¹ 2021 Calculation
Area asset turnover = Revenues ÷ Long-lived assets
= 1,162,400 ÷ 25,400 = 45.76

Revenue generated in Germany exhibited modest growth between 2019 and 2021, increasing from $1.126 billion to $1.162 billion. While a growth trend was observable between 2019 and 2020, performance plateaued in 2021 with only a marginal increase in total revenues.

Revenue Trends: Revenues rose by approximately 3.08% in 2020 and remained nearly stagnant in 2021, indicating a stabilization of the top-line performance in the German market.
Long-lived Asset Dynamics: Asset levels fluctuated over the period, increasing from $27.5 million in 2019 to $31.2 million in 2020, before declining to $25.4 million by the end of 2021. The 2021 reduction represents the lowest asset level recorded in the three-year period.
Area Asset Turnover Analysis: The asset turnover ratio experienced a decline from 40.96 in 2019 to 37.22 in 2020, which corresponds with the increase in long-lived assets outpacing revenue growth. Conversely, a significant recovery occurred in 2021, with the ratio rising to 45.76. This improvement in efficiency was driven by the reduction in the asset base while maintaining consistent revenue levels.

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Area Asset Turnover: Asia

Biogen Inc.; Asia; area asset turnover calculation

	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Selected Financial Data (US$ in thousands)
Revenues	724,700)	629,600)	432,500)	377,400)	202,800)
Long-lived assets	16,400)	16,200)	6,200)	3,900)	5,200)
Area Activity Ratio
Area asset turnover¹	44.19	38.86	69.76	96.77	39.00

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

¹ 2021 Calculation
Area asset turnover = Revenues ÷ Long-lived assets
= 724,700 ÷ 16,400 = 44.19

Revenues in the Asian region exhibited a consistent and strong upward trajectory between 2017 and 2021, growing from $202.8 million to $724.7 million. This represents a significant expansion in regional scale. While revenue increased steadily, the associated long-lived assets remained relatively stable until 2020, at which point a substantial increase in capital investment was observed, with assets rising to $16.4 million by 2021.

Revenue Growth Patterns: A steady increase in revenue is observed throughout the analyzed period. The most significant absolute growth occurred between 2019 and 2020, where revenues rose from $432.5 million to $629.6 million, indicating a period of accelerated market penetration or product adoption.
Asset Base Evolution: Long-lived assets remained low and fluctuated slightly between 2017 and 2019. A sharp escalation occurred in 2020, with assets increasing from $6.2 million to $16.2 million. This substantial rise suggests a strategic investment in regional infrastructure or long-term assets to support the growing revenue base.
Area Asset Turnover Volatility: The area asset turnover ratio demonstrated significant volatility, peaking at 96.77 in 2018. This peak was the result of increasing revenues coupled with a decrease in long-lived assets to $3.9 million. The ratio subsequently declined, reaching a low of 38.86 in 2020, which directly correlates with the surge in the asset base. A modest recovery to 44.19 was observed in 2021, as revenue growth began to slightly outpace the incremental increase in assets.

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Area Asset Turnover: Other

Biogen Inc.; Other; area asset turnover calculation

	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
Selected Financial Data (US$ in thousands)
Revenues	626,600)	619,300)	629,500)	511,400)	415,700)
Long-lived assets	21,700)	10,900)	12,000)	1,800)	2,100)
Area Activity Ratio
Area asset turnover¹	28.88	56.82	52.46	284.11	197.95

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

¹ 2021 Calculation
Area asset turnover = Revenues ÷ Long-lived assets
= 626,600 ÷ 21,700 = 28.88

An analysis of the financial data reveals a significant divergence between revenue growth and the accumulation of long-lived assets, resulting in a substantial decline in the area asset turnover ratio over the five-year period ending December 31, 2021.

Revenue Performance: Revenues exhibited a consistent upward trajectory from 2017 to 2019, increasing from 415.7 million to 629.5 million. Following this growth phase, revenues stabilized, remaining relatively flat between 2019 and 2021, with a final value of 626.6 million.
Long-Lived Asset Expansion: Long-lived assets remained minimal during 2017 and 2018, totaling 2.1 million and 1.8 million, respectively. A significant shift occurred in 2019, where assets increased more than six-fold to 12 million. This expansion trend continued through 2021, reaching 21.7 million, representing a total increase of approximately 933% from the 2017 baseline.
Area Asset Turnover Trends: The area asset turnover ratio peaked in 2018 at 284.11, reflecting high revenue generation relative to a very small asset base. However, a sharp contraction occurred in 2019, with the ratio falling to 52.46 as long-lived assets grew aggressively. Despite a marginal recovery to 56.82 in 2020, the ratio declined further to 28.88 by the end of 2021.

The overall trend indicates that while revenue growth plateaued after 2019, the company continued to invest heavily in long-lived assets. The resulting decline in the asset turnover ratio suggests a diminishing efficiency in utilizing these specific assets to generate revenue within the analyzed area.

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Revenues

Biogen Inc., revenues by geographic area

US$ in thousands

	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
U.S.	5,832,300)	8,531,100)	9,511,500)	9,160,900)	8,742,200)
Europe	2,635,700)	2,503,400)	2,678,000)	3,403,200)	2,913,200)
Germany	1,162,400)	1,161,200)	1,126,400)	—)	—)
Asia	724,700)	629,600)	432,500)	377,400)	202,800)
Other	626,600)	619,300)	629,500)	511,400)	415,700)
Total	10,981,700)	13,444,600)	14,377,900)	13,452,900)	12,273,900)

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

Total revenue experienced an initial growth phase from 2017 to 2019, reaching a peak of $14.38 billion, followed by a contraction that resulted in a decline to $10.98 billion by the end of 2021. This overall trajectory is heavily influenced by the performance of the primary domestic market.

United States Revenue Trends: The U.S. market serves as the primary revenue driver, though it exhibited significant volatility toward the end of the period. After peaking at $9.51 billion in 2019, revenues declined to $8.53 billion in 2020 and experienced a sharp contraction to $5.83 billion in 2021. The substantial decrease in U.S. earnings is the central factor contributing to the decline in total global revenue.
European and German Market Analysis: Revenue attributed to Europe peaked in 2018 at $3.40 billion before experiencing a downward trend and stabilizing at $2.64 billion by 2021. Notably, Germany began appearing as a separate reporting line in 2019, maintaining a consistent revenue level of approximately $1.16 billion through 2021, which suggests a stable performance within that specific territory despite broader regional fluctuations.
Growth in Asia and Other Regions: A consistent upward trend is observed in the Asian market, which grew from $202.8 million in 2017 to $724.7 million in 2021, representing the most significant proportional growth among all geographic segments. Similarly, revenue from other regions increased from $415.7 million in 2017 to $626.6 million in 2021, indicating a steady expansion in non-core geographic areas.

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Long-lived assets

Biogen Inc., long-lived assets by geographic area

US$ in thousands

	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019	Dec 31, 2018	Dec 31, 2017
U.S.	1,390,500)	1,496,300)	1,493,200)	1,152,700)	1,226,900)
Europe	2,337,800)	2,290,200)	2,135,400)	2,442,800)	1,948,200)
Germany	25,400)	31,200)	27,500)	—)	—)
Asia	16,400)	16,200)	6,200)	3,900)	5,200)
Other	21,700)	10,900)	12,000)	1,800)	2,100)
Total	3,791,800)	3,844,800)	3,674,300)	3,601,200)	3,182,400)

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31).

Total long-lived assets exhibited a general growth trend from 2017 to 2020, increasing from US$ 3.18 billion to US$ 3.84 billion, before experiencing a slight contraction to US$ 3.79 billion by the end of 2021. The asset distribution is heavily concentrated in Europe and the United States, which collectively represent the vast majority of the company's long-term geographic investment.

European Market Dominance: Europe consistently maintains the highest valuation of long-lived assets. A substantial increase occurred between 2017 and 2018, with assets rising from US$ 1.95 billion to US$ 2.44 billion. Despite a brief dip in 2019, the region remained the primary asset hub, concluding 2021 with US$ 2.34 billion.
U.S. Asset Fluctuations: Long-lived assets in the United States showed a non-linear trend, decreasing from US$ 1.23 billion in 2017 to US$ 1.15 billion in 2018, followed by a significant increase to approximately US$ 1.50 billion by 2020. A moderate decline to US$ 1.39 billion was observed in 2021.
Strategic Expansion in Asia and Other Regions: While representing a smaller fraction of the total portfolio, Asia showed a marked increase in assets, particularly between 2019 and 2020, where values grew from US$ 6.2 million to US$ 16.2 million. Similarly, the assets categorized as "Other" grew from US$ 2.1 million in 2017 to US$ 21.7 million in 2021, indicating a trend toward broader geographic diversification.
Germany Reporting Granularity: Germany began appearing as a distinct reporting line in 2019 with US$ 27.5 million in assets. The value peaked in 2020 at US$ 31.2 million before adjusting to US$ 25.4 million in 2021, reflecting a shift toward more granular financial reporting for specific European territories.

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