Product Sales

EYLEA^® net product sales in the United States totaled $734.4 million and $445.0 million for the three months ended September 30, 2015 and 2014, respectively, and $1,930.0 million and $1,218.8 million for the nine months ended September 30, 2015 and 2014, respectively. In addition, ARCALYST^® net product sales totaled $3.2 million and $3.8 million for the three months ended September 30, 2015 and 2014, respectively, and $9.9 million and $10.4 million for the nine months ended September 30, 2015 and 2014, respectively.

The Company recorded 65% and 72% for the three months ended September 30, 2015 and 2014, respectively, and 67% and 75% for the nine months ended September 30, 2015 and 2014, respectively, of its total gross product revenue from sales to Besse Medical, a subsidiary of AmerisourceBergen Corporation.

Revenue from product sales is recorded net of applicable provisions for rebates and chargebacks under governmental programs, distribution-related fees, and other sales-related deductions. The following table summarizes the provisions, and credits/payments, for these sales-related deductions during the nine months ended September 30, 2015 and 2014.



	Rebates & Chargebacks			Distribution- Related Fees			Other Sales- Related Deductions			Total
Balance as of December 31, 2014	$	3,083		$	21,166		$	532		$	24,781
Provision related to current period sales	41,290			88,049			6,024			135,363
Credits/payments	(38,011		)	(71,007		)	(6,052		)	(115,070		)
Balance as of September 30, 2015	$	6,362		$	38,208		$	504		$	45,074

Balance as of December 31, 2013	$	4,400		$	19,663		$	538		$	24,601
Provision related to current period sales	23,265			53,689			1,202			78,156
Credits/payments	(23,873		)	(54,878		)	(1,211		)	(79,962		)
Balance as of September 30, 2014	$	3,792		$	18,474		$	529		$	22,795

Under the provisions of the Patient Protection and Affordable Care Act ("PPACA") and the Health Care and Education Reconciliation Act of 2010, a non-tax deductible annual fee (the "Branded Prescription Drug Fee") is imposed on pharmaceutical manufacturers that sell branded prescription drugs to specified government programs. In July 2014, the Internal Revenue Service ("IRS") issued final regulations that provide guidance on the Branded Prescription Drug Fee. The final regulations differ in some respects from the temporary regulations previously issued by the IRS in 2011, including that a company is liable for the fee based on its branded prescription drug sales in the current year, instead of the liability only being applicable upon the first qualifying branded prescription drug sale of the following fee year under the temporary regulations. As a result of the issuance of these final IRS regulations, the Company began recording an estimate of the fee in the same period in which its qualifying branded prescription drug sales occur. Therefore, in the third quarter of 2014, an incremental charge was recorded to (i) recognize a liability for the estimated fee payable based on 2014 sales through the first nine months of 2014, and (ii) expense the remaining prepaid asset recorded under the previous accounting for the estimated fee payable based on 2013 sales. The impact of the incremental charge in the third quarter of 2014 was $40.6 million, which was included in selling, general, and administrative expenses.