Economic Value Added (EVA)
EVA is registered trademark of Stern Stewart.
Economic value added or economic profit is the difference between revenues and costs,where costs include not only expenses, but also cost of capital.
Economic Profit
Regeneron Pharmaceuticals Inc., economic profit calculation
US$ in thousands
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 NOPAT. See details »
2 Cost of capital. See details »
3 Invested capital. See details »
4 2025 Calculation
Economic profit = NOPAT – Cost of capital × Invested capital
= 3,147,470 – 10.23% × 13,198,700 = 1,797,882
The economic profit analysis for the period between 2021 and 2025 reveals a significant contraction in value creation following a peak in 2021, followed by a period of volatility and relative stabilization.
- Net Operating Profit After Taxes (NOPAT)
- A substantial decline in NOPAT is observed from 2021 to 2023, decreasing from 7,819,887 thousand USD to 2,823,336 thousand USD. A partial recovery occurred in 2024, with NOPAT rising to 3,374,924 thousand USD, before declining slightly to 3,147,470 thousand USD in 2025. The overall trend indicates a significant reduction in operating profitability compared to the initial period.
- Invested Capital and Cost of Capital
- Invested capital demonstrates a general upward trajectory, growing from 10,786,500 thousand USD in 2021 to 13,198,700 thousand USD in 2025. Throughout this period, the cost of capital remained highly stable, fluctuating within a narrow range between 10.13% and 10.29%. The continuous increase in the capital base, paired with a stable cost of capital, has increased the absolute capital charge required to achieve positive economic profit.
- Economic Profit Performance
- Economic profit experienced a sharp decline, falling from 6,726,688 thousand USD in 2021 to a period low of 1,588,608 thousand USD in 2023. While there was a moderate rebound to 2,080,481 thousand USD in 2024, the figure retreated to 1,797,882 thousand USD by 2025. Despite the overall downward trend from the 2021 peak, economic profit remained positive in every year analyzed, confirming that the returns on invested capital consistently exceeded the cost of capital.
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Net Operating Profit after Taxes (NOPAT)
Regeneron Pharmaceuticals Inc., NOPAT calculation
US$ in thousands
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Elimination of deferred tax expense. See details »
2 Addition of increase (decrease) in deferred revenue.
3 Addition of increase (decrease) in equity equivalents to net income.
4 2025 Calculation
Interest expense on capitalized operating leases = Operating lease liability × Discount rate
= 266,800 × 5.38% = 14,354
5 2025 Calculation
Tax benefit of interest expense = Adjusted interest expense × Statutory income tax rate
= 58,154 × 21.00% = 12,212
6 Addition of after taxes interest expense to net income.
7 2025 Calculation
Tax expense (benefit) of investment income = Investment income, before tax × Statutory income tax rate
= 716,800 × 21.00% = 150,528
8 Elimination of after taxes investment income.
The financial performance, as indicated by Net Income and Net Operating Profit After Taxes (NOPAT), demonstrates considerable fluctuation over the five-year period. A significant decline in both metrics is observed between 2021 and 2023, followed by a partial recovery in subsequent years.
- NOPAT Trend
- NOPAT experienced a substantial decrease from US$7,819,887 thousand in 2021 to US$2,823,336 thousand in 2023, representing a decline of approximately 64%. This suggests a weakening in core operational profitability. A subsequent increase to US$3,374,924 thousand in 2024 indicates some recovery, but NOPAT decreased again in 2025 to US$3,147,470 thousand, suggesting the recovery may not be sustained.
- Relationship between Net Income and NOPAT
- While both Net Income and NOPAT follow a similar pattern of decline and partial recovery, NOPAT consistently represents a larger value than Net Income. This difference could be attributed to factors not reflected in net income, such as non-operating expenses or gains, or differences in accounting treatment. The gap between the two metrics appears relatively stable throughout the period.
The observed volatility in NOPAT warrants further investigation to determine the underlying drivers. Potential areas of inquiry include changes in revenue, cost of goods sold, operating expenses, and tax rates. The decrease in 2025, following the 2024 increase, suggests potential challenges in maintaining operational efficiency or market position.
- Overall Performance
- The period under review demonstrates a period of instability. While the company shows some ability to recover from the low point in 2023, the performance in 2025 indicates that the recovery may be limited. Continued monitoring of NOPAT and its contributing factors is recommended.
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Cash Operating Taxes
Regeneron Pharmaceuticals Inc., cash operating taxes calculation
US$ in thousands
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
The relationship between income tax expense and cash operating taxes demonstrates notable fluctuations over the five-year period. Cash operating taxes generally exceed income tax expense, suggesting timing differences between reported accounting income and actual cash outflows for taxes.
- Overall Trend - Cash Operating Taxes
- Cash operating taxes exhibit a decreasing trend from 2021 to 2023, followed by a slight increase in 2024 and a more substantial rise in 2025. The value decreased from US$1,400,760 thousand in 2021 to US$995,682 thousand in 2023, representing a 28.9% decline. A modest increase to US$989,515 thousand occurred in 2024, before a significant jump to US$1,372,884 thousand in 2025.
- Overall Trend - Income Tax Expense
- Income tax expense shows a significant decrease from 2021 to 2022, followed by continued declines through 2023, a slight increase in 2024, and a further increase in 2025. The value fell from US$1,250,500 thousand in 2021 to US$245,700 thousand in 2023, a decrease of 80.3%. An increase to US$367,300 thousand was observed in 2024, and a further increase to US$725,800 thousand in 2025.
- Relationship Between Tax Items
- The difference between cash operating taxes and income tax expense varied considerably. In 2021, cash operating taxes exceeded income tax expense by US$150,260 thousand. This difference narrowed in 2022 to US$725,998 thousand. By 2023, cash operating taxes exceeded income tax expense by US$750,000 thousand. The difference decreased to US$622,115 thousand in 2024, and then increased to US$647,084 thousand in 2025. This suggests that deferred tax assets or liabilities are playing a significant role in the company’s tax position.
The substantial fluctuations in both income tax expense and cash operating taxes warrant further investigation to understand the underlying drivers, such as changes in tax laws, the utilization of tax credits, or alterations in the company’s accounting practices related to deferred taxes. The increasing trend in both measures in 2025 suggests a potential increase in future tax liabilities.
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Invested Capital
Regeneron Pharmaceuticals Inc., invested capital calculation (financing approach)
US$ in thousands
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Addition of capitalized operating leases.
2 Elimination of deferred taxes from assets and liabilities. See details »
3 Addition of deferred revenue.
4 Addition of equity equivalents to stockholders’ equity.
5 Removal of accumulated other comprehensive income.
6 Subtraction of construction in progress.
7 Subtraction of marketable securities.
The invested capital of the organization demonstrates a generally increasing trend over the five-year period, although with some fluctuation. Total reported debt & leases and stockholders’ equity both contribute to this figure, and their individual movements influence the overall invested capital.
- Invested Capital Trend
- Invested capital increased from US$10,786,500 thousand in 2021 to US$12,287,700 thousand in 2022, representing a substantial rise. A decrease was then observed in 2023, with invested capital falling to US$11,998,500 thousand. Subsequent years show renewed growth, reaching US$12,653,600 thousand in 2024 and US$13,198,700 thousand in 2025. This suggests periods of capital investment followed by potential adjustments or reallocations.
- Debt & Leases
- Total reported debt & leases exhibits a consistent, albeit moderate, upward trend throughout the period. Starting at US$2,767,900 thousand in 2021, it increases to US$2,972,700 thousand in 2025. The increases are relatively steady year-over-year, indicating a consistent reliance on debt financing.
- Stockholders’ Equity
- Stockholders’ equity demonstrates a strong and consistent upward trend. It increased significantly from US$18,768,800 thousand in 2021 to US$31,256,900 thousand in 2025. This growth suggests successful earnings retention and/or new equity issuance, contributing significantly to the overall increase in invested capital.
- Relationship between Components
- While both debt & leases and stockholders’ equity contribute to invested capital, stockholders’ equity represents the larger portion and drives the majority of the overall trend. The relatively smaller increases in debt & leases are overshadowed by the substantial growth in equity. The dip in invested capital in 2023 appears to be influenced by a combination of factors, including a slight decrease in equity growth and the impact of debt levels.
In summary, the organization’s invested capital has generally increased over the observed period, primarily driven by growth in stockholders’ equity. Debt & leases have also increased, but to a lesser extent. The fluctuation in invested capital in 2023 warrants further investigation to understand the underlying causes.
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Cost of Capital
Regeneron Pharmaceuticals Inc., cost of capital calculations
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 81,939,193) | 81,939,193) | ÷ | 84,501,993) | = | 0.97 | 0.97 | × | 10.47% | = | 10.15% | ||
| Long-term debt and finance lease liabilities3 | 2,296,000) | 2,296,000) | ÷ | 84,501,993) | = | 0.03 | 0.03 | × | 2.74% × (1 – 21.00%) | = | 0.06% | ||
| Operating lease liability4 | 266,800) | 266,800) | ÷ | 84,501,993) | = | 0.00 | 0.00 | × | 5.38% × (1 – 21.00%) | = | 0.01% | ||
| Total: | 84,501,993) | 1.00 | 10.23% | ||||||||||
Based on: 10-K (reporting date: 2025-12-31).
1 US$ in thousands
2 Equity. See details »
3 Long-term debt and finance lease liabilities. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 78,355,186) | 78,355,186) | ÷ | 80,793,586) | = | 0.97 | 0.97 | × | 10.47% | = | 10.15% | ||
| Long-term debt and finance lease liabilities3 | 2,204,000) | 2,204,000) | ÷ | 80,793,586) | = | 0.03 | 0.03 | × | 2.91% × (1 – 21.00%) | = | 0.06% | ||
| Operating lease liability4 | 234,400) | 234,400) | ÷ | 80,793,586) | = | 0.00 | 0.00 | × | 5.52% × (1 – 21.00%) | = | 0.01% | ||
| Total: | 80,793,586) | 1.00 | 10.23% | ||||||||||
Based on: 10-K (reporting date: 2024-12-31).
1 US$ in thousands
2 Equity. See details »
3 Long-term debt and finance lease liabilities. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 102,773,356) | 102,773,356) | ÷ | 105,109,056) | = | 0.98 | 0.98 | × | 10.47% | = | 10.24% | ||
| Long-term debt and finance lease liabilities3 | 2,248,000) | 2,248,000) | ÷ | 105,109,056) | = | 0.02 | 0.02 | × | 2.92% × (1 – 21.00%) | = | 0.05% | ||
| Operating lease liability4 | 87,700) | 87,700) | ÷ | 105,109,056) | = | 0.00 | 0.00 | × | 5.38% × (1 – 21.00%) | = | 0.00% | ||
| Total: | 105,109,056) | 1.00 | 10.29% | ||||||||||
Based on: 10-K (reporting date: 2023-12-31).
1 US$ in thousands
2 Equity. See details »
3 Long-term debt and finance lease liabilities. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 85,367,935) | 85,367,935) | ÷ | 87,599,135) | = | 0.97 | 0.97 | × | 10.47% | = | 10.20% | ||
| Long-term debt and finance lease liabilities3 | 2,163,000) | 2,163,000) | ÷ | 87,599,135) | = | 0.02 | 0.02 | × | 2.86% × (1 – 21.00%) | = | 0.06% | ||
| Operating lease liability4 | 68,200) | 68,200) | ÷ | 87,599,135) | = | 0.00 | 0.00 | × | 5.20% × (1 – 21.00%) | = | 0.00% | ||
| Total: | 87,599,135) | 1.00 | 10.26% | ||||||||||
Based on: 10-K (reporting date: 2022-12-31).
1 US$ in thousands
2 Equity. See details »
3 Long-term debt and finance lease liabilities. See details »
4 Operating lease liability. See details »
| Capital (fair value)1 | Weights | Cost of capital | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Equity2 | 67,550,508) | 67,550,508) | ÷ | 70,225,408) | = | 0.96 | 0.96 | × | 10.47% | = | 10.07% | ||
| Long-term debt and finance lease liabilities3 | 2,606,700) | 2,606,700) | ÷ | 70,225,408) | = | 0.04 | 0.04 | × | 2.02% × (1 – 21.00%) | = | 0.06% | ||
| Operating lease liability4 | 68,200) | 68,200) | ÷ | 70,225,408) | = | 0.00 | 0.00 | × | 5.20% × (1 – 21.00%) | = | 0.00% | ||
| Total: | 70,225,408) | 1.00 | 10.13% | ||||||||||
Based on: 10-K (reporting date: 2021-12-31).
1 US$ in thousands
2 Equity. See details »
3 Long-term debt and finance lease liabilities. See details »
4 Operating lease liability. See details »
Economic Spread Ratio
Regeneron Pharmaceuticals Inc., economic spread ratio calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Economic profit1 | 1,797,882) | 2,080,481) | 1,588,608) | 2,286,590) | 6,726,688) | |
| Invested capital2 | 13,198,700) | 12,653,600) | 11,998,500) | 12,287,700) | 10,786,500) | |
| Performance Ratio | ||||||
| Economic spread ratio3 | 13.62% | 16.44% | 13.24% | 18.61% | 62.36% | |
| Benchmarks | ||||||
| Economic Spread Ratio, Competitors4 | ||||||
| AbbVie Inc. | 0.54% | -2.40% | -4.11% | 5.32% | 4.71% | |
| Amgen Inc. | 6.11% | -0.67% | 2.15% | 6.66% | 6.66% | |
| Bristol-Myers Squibb Co. | 5.48% | -22.18% | 1.38% | -1.40% | 0.91% | |
| Danaher Corp. | -10.72% | -10.89% | -11.66% | -6.65% | -5.82% | |
| Eli Lilly & Co. | 29.94% | 14.28% | 1.21% | 8.31% | 9.99% | |
| Gilead Sciences Inc. | 12.42% | -10.66% | 2.68% | -0.45% | 6.60% | |
| Johnson & Johnson | 11.34% | 1.67% | -0.18% | 5.09% | 10.15% | |
| Merck & Co. Inc. | 10.27% | 13.14% | -9.17% | 11.01% | 11.20% | |
| Pfizer Inc. | -3.81% | -3.50% | -9.60% | 17.82% | 10.99% | |
| Thermo Fisher Scientific Inc. | -7.47% | -8.27% | -8.74% | -6.99% | -4.97% | |
| Vertex Pharmaceuticals Inc. | 20.56% | -23.09% | 10.85% | 13.60% | 14.81% | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Economic profit. See details »
2 Invested capital. See details »
3 2025 Calculation
Economic spread ratio = 100 × Economic profit ÷ Invested capital
= 100 × 1,797,882 ÷ 13,198,700 = 13.62%
4 Click competitor name to see calculations.
The financial trajectory from 2021 to 2025 is characterized by a significant contraction in value creation efficiency during the initial period, followed by a phase of stabilization. A notable divergence is observed between the growth of invested capital and the volatility of economic profit, which directly impacts the economic spread ratio.
- Economic Profit Trends
- A sharp decline in economic profit occurred between 2021 and 2023, falling from 6,726,688 thousand USD to a low of 1,588,608 thousand USD. While a moderate recovery was recorded in 2024, reaching 2,080,481 thousand USD, the figure declined again to 1,797,882 thousand USD by the end of 2025. This suggests a period of significant volatility in the company's ability to generate returns above its cost of capital.
- Invested Capital Growth
- Invested capital demonstrates a general upward trend over the five-year period. After an initial increase from 10,786,500 thousand USD in 2021 to 12,287,700 thousand USD in 2022, a slight contraction occurred in 2023. Subsequently, capital expanded steadily, reaching 13,198,700 thousand USD by 2025. This indicates a consistent commitment to capital deployment despite the fluctuations in economic profit.
- Economic Spread Ratio Analysis
- The economic spread ratio experienced a precipitous drop from a peak of 62.36% in 2021 to 13.24% in 2023. This collapse reflects a substantial reduction in the margin by which the return on invested capital exceeds the cost of capital. From 2023 through 2025, the ratio remained relatively stable, fluctuating within a narrow band between 13.24% and 16.44%, indicating that the company has reached a new, lower equilibrium in its value-generation efficiency.
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Economic Profit Margin
Regeneron Pharmaceuticals Inc., economic profit margin calculation, comparison to benchmarks
| Dec 31, 2025 | Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | ||||||
| Economic profit1 | 1,797,882) | 2,080,481) | 1,588,608) | 2,286,590) | 6,726,688) | |
| Revenues | 14,342,900) | 14,202,000) | 13,117,200) | 12,172,900) | 16,071,700) | |
| Add: Increase (decrease) in deferred revenue | (51,700) | 227,800) | 37,900) | 32,400) | (120,200) | |
| Adjusted revenues | 14,291,200) | 14,429,800) | 13,155,100) | 12,205,300) | 15,951,500) | |
| Performance Ratio | ||||||
| Economic profit margin2 | 12.58% | 14.42% | 12.08% | 18.73% | 42.17% | |
| Benchmarks | ||||||
| Economic Profit Margin, Competitors3 | ||||||
| AbbVie Inc. | 0.54% | -2.95% | -5.16% | 7.52% | 8.04% | |
| Amgen Inc. | 10.18% | -1.32% | 5.60% | 10.67% | 11.04% | |
| Bristol-Myers Squibb Co. | 6.74% | -28.77% | 2.07% | -2.18% | 1.57% | |
| Danaher Corp. | -32.86% | -33.60% | -38.27% | -16.51% | -14.53% | |
| Eli Lilly & Co. | 22.79% | 11.35% | 1.04% | 7.07% | 9.22% | |
| Gilead Sciences Inc. | 18.38% | -16.51% | 4.56% | -0.76% | 11.67% | |
| Johnson & Johnson | 16.64% | 2.01% | -0.21% | 6.10% | 10.61% | |
| Merck & Co. Inc. | 15.48% | 16.26% | -10.67% | 13.73% | 16.26% | |
| Pfizer Inc. | -8.52% | -7.44% | -24.97% | 19.50% | 11.73% | |
| Thermo Fisher Scientific Inc. | -15.79% | -15.83% | -17.45% | -12.89% | -10.11% | |
| Vertex Pharmaceuticals Inc. | 18.13% | -18.96% | 14.56% | 20.07% | 18.36% | |
Based on: 10-K (reporting date: 2025-12-31), 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31).
1 Economic profit. See details »
2 2025 Calculation
Economic profit margin = 100 × Economic profit ÷ Adjusted revenues
= 100 × 1,797,882 ÷ 14,291,200 = 12.58%
3 Click competitor name to see calculations.
An analysis of the financial performance from 2021 to 2025 reveals a significant contraction in economic value creation, followed by a period of relative stabilization. The most pronounced decline occurred between 2021 and 2023, after which metrics showed modest fluctuations without returning to initial levels.
- Economic Profit Trajectory
- Economic profit experienced a sharp reduction, falling from 6,726,688 thousand US$ in 2021 to a low of 1,588,608 thousand US$ in 2023. While a recovery was observed in 2024 with an increase to 2,080,481 thousand US$, this momentum did not persist into 2025, as the figure declined again to 1,797,882 thousand US$.
- Adjusted Revenue Trends
- Adjusted revenues exhibited volatility throughout the period. A notable decrease occurred in 2022, dropping to 12,205,300 thousand US$ from 15,951,500 thousand US$ in 2021. This was followed by a steady recovery through 2024, peaking at 14,429,800 thousand US$, before remaining largely flat in 2025 at 14,291,200 thousand US$.
- Economic Profit Margin Analysis
- The economic profit margin reflects a substantial erosion of value-generation efficiency. The margin collapsed from a peak of 42.17% in 2021 to 12.08% by 2023. A marginal improvement to 14.42% was recorded in 2024, but the margin retracted to 12.58% in 2025. The disparity between the 2021 peak and subsequent years suggests a fundamental shift in the relationship between revenues and the cost of capital employed.
The data indicates that the decline in economic profit was more severe than the decline in adjusted revenues, particularly between 2021 and 2022. This suggests that the reduction in economic value was driven not only by revenue fluctuations but also by potential increases in operating expenses or a higher capital charge during that interval.
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