EX-99.1 3 ex99-1.txt FINANCIAL STATEMENTS FOR BIOGEN SAVINGS PLAN 1 Exhibit 99.1 BIOGEN, INC. BIOGEN SAVINGS PLAN FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES DECEMBER 31, 1999 AND 1998 2 BIOGEN, INC. BIOGEN SAVINGS PLAN INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULE --------------------------------------------------------------------------------
PAGE Report of Independent Accountants 1 Statement of Assets Available for Plan Benefits as of December 31, 1999 and 1998 2 Statements of Changes in Assets Available for Plan Benefits for the Years Ended December 31, 1999 and 1998 3 Notes to Financial Statements 4-7 Supplemental Schedules*: Supplemental Schedule I Assets Held for Investment Purposes as of December 31, 1999 8 Supplemental Schedule II Transactions Involving Amounts in Excess of 5% of the Current Value 9 of Plan Assets for the Year Ended December 31, 1999 * Other schedules have been omitted because such schedules are not applicable.
3 REPORT OF INDEPENDENT ACCOUNTANTS To the Participants and Administrator of the Biogen Savings Plan In our opinion, the accompanying statements of assets available for plan benefits and the related statements of changes in assets available for plan benefits present fairly, in all material respects, the assets available for plan benefits of the Biogen Savings Plan (the "Plan") at December 31, 1999 and 1998, and the changes in assets available for plan benefits for the years then ended in conformity with accounting principles generally accepted in the United States. These financial statements are the responsibility of the Plan's management; our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these statements in accordance with auditing standards generally accepted in the United States, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for the opinion expressed above. Our audits were conducted for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules I and II are presented for the purpose of additional analysis and are not a required part of the basic financial statements but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. These supplemental schedules are the responsibility of the Plan's management. The supplemental schedules have been subjected to the auditing procedures applied in the audits of the basic financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole. June 27, 2000 PricewaterhouseCoopers LLP Boston, Massachusetts 4 BIOGEN, INC. BIOGEN SAVINGS PLAN STATEMENT OF ASSETS AVAILABLE FOR PLAN BENEFITS DECEMBER 31, 1999 AND 1998 -------------------------------------------------------------------------------- 1999 1998 ASSETS Investments at fair value: Mutual Funds: Fidelity Intermediate Bond Fund $ 1,375,497 $ 1,226,161 Fidelity Puritan Fund* 5,873,976 5,393,202 Fidelity Value Fund 824,946 1,002,445 Fidelity Magellan Fund* 12,722,798 9,278,946 Fidelity Retirement Government Money Market Fund 1,978,221 1,632,338 Fidelity Growth Company Fund* 15,675,154 7,802,376 Fidelity International Growth Income Fund 11,528 -- Fidelity Asset Manager Fund 1,344,059 1,066,774 Fidelity US Equity Index Fund* 4,129,562 2,677,468 Fidelity US Bond Index Fund 420,465 279,121 Fidelity Low-Priced Stock Fund 711,337 486,853 USAA International Fund 772,722 535,219 Janus Worldwide Fund 2,669,669 749,449 ----------- ----------- Total mutual funds 48,509,934 32,130,352 ----------- ----------- Biogen, Inc. Stock Fund: Biogen, Inc. common stock* 18,858,795 8,523,321 Interest bearing cash 271,009 174,421 ----------- ----------- Total Biogen, Inc. Stock Fund 19,129,804 8,697,742 ----------- ----------- Loans to participants 715,247 743,526 ----------- ----------- Total investments 68,354,985 41,571,620 ----------- ----------- Receivables: Investment income receivable 1,767 -- Receivable for investments sold 116,760 -- ----------- ----------- Total receivables 118,527 -- ----------- ----------- Assets available for plan benefits $68,473,512 $41,571,620 =========== =========== * Represents 5% or more of assets available for plan benefits. The accompanying notes are an integral part of these financial statements. 2 5 BIOGEN, INC. BIOGEN SAVINGS PLAN STATEMENT OF CHANGES IN ASSETS AVAILABLE FOR PLAN BENEFITS FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998 -------------------------------------------------------------------------------- 1999 1998 Additions: Net appreciation of investments: Mutual funds $ 8,205,188 $ 3,580,013 Biogen, Inc. common stock 9,376,362 4,654,644 Investment income: Dividends and interest 3,227,039 2,116,226 Contributions: Employer contributions 759,576 620,721 Participant contributions 5,214,809 4,228,628 Participant rollovers 1,631,157 1,071,575 ----------- ----------- Total additions 28,414,131 16,271,807 Deductions: Benefits paid to participants 1,511,839 2,963,213 Administrative fees 400 116 ----------- ----------- Total deductions 1,512,239 2,963,329 ----------- ----------- Net increase 26,901,892 13,308,478 Assets available for plan benefits: Beginning of year 41,571,620 28,263,142 ----------- ----------- End of year $68,473,512 $41,571,620 =========== =========== The accompanying notes are an integral part of these financial statements. 3 6 BIOGEN, INC. BIOGEN SAVINGS PLAN NOTES TO FINANCIAL STATEMENTS -------------------------------------------------------------------------------- 1. DESCRIPTION OF THE PLAN The following brief description of the Biogen Savings Plan (the "Plan") is provided for general information purposes only. Participants should refer to the Plan agreement for more complete information. GENERAL INFORMATION Biogen, Inc. (the "Company") established the Plan as a deferred profit-sharing plan under Section 401(a) of the Internal Revenue Code of 1986, effective January 1, 1987. The Plan is designed to allow eligible employees to accumulate savings for retirement in the Plan without paying income taxes until the savings are actually received. ADMINISTRATION OF THE PLAN The Plan is administered by the Savings Plan Committee (the "Plan Committee"), whose members are appointed by the Company. Fidelity Management Trust Company is the Plan trustee (the "Trustee"). The majority of administrative costs of the Plan have been assumed by the Company. PARTICIPATION Participation in the Plan is voluntary. Each employee of the Company is eligible to participate in the Plan upon the attainment of age 21 unless he/she is (a) a student employed on a temporary basis, (b) an employee of a non-U.S. subsidiary or division of the Company, or (c) a member of a collective bargaining unit. CONTRIBUTIONS Eligible employees may make savings deposits to the Plan in whole percentages of their gross salary ranging from a minimum of 2% to a maximum of 18%, subject to certain limitations. For each pay period, the Company will make a matching contribution of units of the Biogen, Inc. Stock Fund equal in value to 25% of each employee's savings deposit up to a maximum of 6% of the employee's gross salary, subject to certain limitations. PARTICIPANT ACCOUNTS Fidelity Investments Institutional Operations Company, Inc. is the Plan's recordkeeper. Each participant's account is credited with the participant's contribution, the Company's matching contribution and Plan earnings. Allocations are based on participant earnings or account balances, as defined. The benefit to which a participant is entitled is the benefit that can be provided from the participant's vested account. INVESTMENT OF CONTRIBUTIONS Company matching contributions are invested in the Biogen, Inc. Stock Fund. The Biogen, Inc. Stock Fund includes Biogen, Inc. stock and cash or short term investments for liquidity purposes. Employee contributions are invested at the direction of the employee in increments of 10% in any combination of the following investment options: o An intermediate bond fund designed to earn a high level of current return. It is invested in Fidelity's Intermediate Bond Fund. o A balanced fund designed to preserve principal balance by investing in a diversified portfolio of high yielding stocks and bonds. It is invested in Fidelity's Puritan Fund. o A fund which seeks to provide capital appreciation from investments in companies which are undervalued or which possess valuable fixed assets. It is invested in Fidelity's Value Fund. 4 7 o An aggressive growth fund invested which seeks to achieve capital appreciation. It is invested in Fidelity's Magellan Fund. o A US government money market fund seeks high current earnings while preserving capital and liquidity. It is invested in Fidelity's Retirement Government Money Market Fund. o A growth company fund which seeks to provide capital appreciation from investments primarily in common stock of companies with above-average growth characteristics. It is invested in Fidelity's Growth Company Fund. o An international equity fund which seeks capital growth, current income and growth of income. It is invested in the Fidelity International Growth & Income Fund. o An asset allocation fund that seeks total return with reduced risk over the long term. It is invested in the Fidelity Asset Manager Fund. o A long term growth fund which seeks to provide investment results that correspond to the total return performance of common stock of companies publicly traded in the US. It is invested in the Fidelity US Equity Index Fund. o A corporate bond fund that seeks to replicate the price and interest performance of the debt securities in the Lehman Brothers Aggregate Bond Index. It is invested in the Fidelity US Bond Index Fund. o A fund which seeks to provide capital appreciation from investments in companies which are undervalued or which are out of favor with other investors and that could offer the possibility for significant growth. It is invested in the Fidelity Low-Priced Stock Fund. o A fund that seeks long term capital growth and current income from investments in stocks of companies organized and operating principally outside the United States. It is invested in the USAA International Fund. o A fund that seeks capital growth over the long term from investments in common stocks of foreign and domestic companies. It is invested in the Janus Worldwide Fund. o A fund that pools money to buy shares of Biogen, Inc. stock and cash or short-term investments. It is invested in the Biogen, Inc. Stock Fund. Dividends, interest, and other distributions received in any fund are reinvested in the same fund. VESTING Participants are fully vested in their savings deposit accounts and rollover accounts at all times. Participants will vest in the employer's matching contribution at a rate of 25% for each year of Plan service and will be fully vested after four years of Plan service. Participants become 100% vested in employer's matching contributions upon retirement or termination of employment due to disability. WITHDRAWALS AND DISTRIBUTIONS Distributions are generally payable at termination of employment due to retirement, disability, death or any other reason. Distribution payments are made in cash in a lump sum for employees' contributions and in whole shares of stock for Company matching contributions. Forfeitures of nonvested amounts are used to reduce the amount of future Company matching contributions. 5 8 LOANS Participants may borrow against their savings deposits. Loans will bear a reasonable interest rate determined by the Company. Repayment of loans is made by direct withholdings of a participant's salary for a period not to exceed five years (ten years for a residential loan). The minimum loan amount is $1,000 and a participant may borrow up to a maximum of 50% of the participant's vested account balance or $50,000, whichever is smaller. There is no minimum service requirement for a participant to be eligible for a loan. PLAN AMENDMENT AND TERMINATION The Company has the right to amend, suspend or terminate the Plan, but may not do so in a way which would divest a participant of accrued vested benefits. If the Plan is terminated, the Trustee will distribute the assets held in the trust, after payment of expenses, in such a manner as the Committee shall determine. The Company currently has no intention to terminate the Plan. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts and disclosures in the financial statements. Actual results could differ from those estimates. The following is a summary of significant accounting policies which are in conformity with accounting principles generally accepted in the United States consistently followed by the Plan in the preparation of its financial statements. BASIS OF ACCOUNTING The financial statements of the Plan are prepared on the accrual basis of accounting. INVESTMENTS Plan investments are stated at fair value. The Company stock is valued at its quoted market price. Mutual fund investments are valued at net asset value representing the value of which shares of the fund may be purchased or redeemed. Loans to participants are stated at principal plus accrued interest, which approximates fair value. Purchases and sales of securities are recorded on a trade-date basis. Cost is determined on the average cost basis. Net appreciation or depreciation, which includes realized and unrealized gains or losses on investments, is reflected for the year in the statement of changes in assets available for plan benefits. Interest income is recorded on the accrual basis. Dividends are recorded on the ex-dividend date. PAYMENT OF BENEFITS Benefits are recorded when paid. INCOME TAXES No provision for income taxes has been made in the financial statements as the Plan qualifies as a tax-exempt entity under Section 401 of the Internal Revenue Code ("Code"). The Plan has received a favorable determination letter dated June 5, 1996 from the Internal Revenue Service. The Plan has since been amended and a new letter has not been requested. Management has asserted the Plan, as amended, and its operations have been and continue to be in accordance with all applicable provisions of the Code and the Employee Retirement Income Security Act of 1974. 6 9 RECLASSIFICATIONS Amounts shown by investment fund option on the statement of assets available for plan benefits as of December 31, 1998 and the statement of changes in assets available for plan benefits for the year ended December 31, 1998 have been reclassified to be shown in total to conform to current year presentation in order to adopt AICPA Statement of Position 99-3, "Accounting for and Reporting of Certain Investments for Defined Contribution Benefit Plans." 3. LOANS TO PARTICIPANTS At December 31, 1999 and 1998, the Plan had loans receivable from participants aggregating $715,247 and $743,526, respectively. Interest rates on the loans range from 7.0% to 11.0% annually. The loans are secured by the participant's interest in the Plan. 4. PARTY-IN-INTEREST TRANSACTIONS Certain of the Plan's assets are invested in mutual funds for which FMR Corp. provides investment advisory services. FMR Corp. is an affiliate of both Fidelity Management Trust Company and Fidelity Investments Institutional Operations Company, Inc. Accordingly, these transactions qualify as party-in-interest. 5. NONPARTICIPANT-DIRECTED INVESTMENT Information about the assets and the significant components of the changes in assets relating to the nonparticipant-directed investment is as follows: DECEMBER 31, 1999 1998 Assets: Biogen, Inc. Stock Fund $19,129,804 $8,697,742 Receivables 118,527 -- ----------- ---------- $19,248,331 $8,697,742 =========== ========== YEAR ENDED DECEMBER 31, 1999 1998 Changes in Assets: Employer contributions $ 759,576 $ 620,721 Participant contributions 521,651 124,328 Dividends 17,924 -- Net appreciation 9,376,362 4,654,644 Transfer of investments from other options 370,227 95,758 Benefits paid to participants (495,151) (361,370) ----------- ---------- $10,550,589 $5,134,081 =========== ========== 7 10 BIOGEN, INC. SUPPLEMENTAL SCHEDULE I BIOGEN SAVINGS PLAN ASSETS HELD FOR INVESTMENT PURPOSES DECEMBER 31, 1999 -------------------------------------------------------------------------------- NUMBER OF SHARES/ CURRENT UNITS COST VALUE --------- ---- ------- 140,932 Fidelity Intermediate Bond Fund* $ 1,375,497 308,669 Fidelity Puritan Fund* 5,873,976 18,830 Fidelity Value Fund* 824,946 93,119 Fidelity Magellan Fund* 12,722,798 1,978,221 Fidelity Retirement Government Money Market Fund* 1,978,221 185,945 Fidelity Growth Company Fund* 15,675,154 383 Fidelity International Growth Income Fund 11,528 68,330 Fidelity Asset Manager Fund* 1,344,059 79,277 Fidelity U.S. Equity Index Fund* 4,129,562 41,263 Fidelity US Bond Index Fund* 420,465 31,419 Fidelity Low-Priced Stock Fund* 711,337 32,952 USAA International Fund 772,722 34,930 Janus Worldwide Fund 2,669,669 ----------- Total mutual funds 48,509,934 ----------- 223,181 Biogen, Inc. common stock* $4,469,031 18,858,795 Interest bearing cash 271,009 ----------- Total Biogen, Inc. Stock Fund 19,129,804 ----------- Loans to participants* 7.0% to 11.0% 715,247 ----------- Total $68,354,985 =========== * Party-in-interest. 8 11 BIOGEN, INC. SUPPLEMENTAL SCHEDULE II BIOGEN SAVINGS PLAN TRANSACTIONS INVOLVING AMOUNTS IN EXCESS OF 5% OF CURRENT VALUE OF PLAN ASSETS YEAR ENDED DECEMBER 31, 1999 --------------------------------------------------------------------------------
CURRENT DESCRIPTION VALUE ON OF PURCHASE SELLING LEASE EXPENSE HISTORICAL TRANSACTION PARTY INVOLVED ASSET PRICE PRICE RENTAL INCURRED COST DATE GAIN (LOSS) Biogen, Inc. Biogen, Inc. common stock $2,950,330 $ -- $ -- $ -- $ -- $2,950,330 $ -- 1,460,975 -- -- 1,144,819 1,460,975 316,156
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