<PAGE> 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K/A
(Mark One)
[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission file number: 0-12042
BIOGEN, INC.
(Exact name of Registrant as specified in its charter)
Massachusetts 04-3002117
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
14 Cambridge Center, Cambridge, Massachusetts 02142
(Address of principal executive offices)(zip code)
Registrant's telephone number, including area code: (617) 679-2000
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: Common Stock,
$.01 par value
(Title of class)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
--- ---
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. [ ]
Aggregate market value of Common Stock held by nonaffiliates of the
Registrant at March 9, 1999 (excludes shares held by directors): $8,018,804,742.
Exclusion of shares held by any person should not be construed to indicate that
such person possesses the power, direct or indirect, to direct or cause the
direction of management or policies of the Registrant, or that such person is
controlled by or under common control with the Registrant. Common Stock
outstanding at March 9, 1999: 75,111,450 shares.
DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Registrant's 1998 Annual Report to Shareholders are
incorporated by reference into Parts II and IV of this Report.
<PAGE> 2
This Form 10-K/A amends the Company's Annual Report on Form 10-K for
the fiscal year ended December 31, 1998 to add as exhibits to the Form 10-K the
financial statements for the Biogen Savings Plan and the related independent
accountants' consent.
<PAGE> 3
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K
(3) Exhibits
The following documents are added as exhibits to the Form 10-K:
Exhibit No. Description
(23) Consent of PricewaterhouseCoopers LLP
(99.1) Financial Statements for Biogen Savings Plan
<PAGE> 4
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
BIOGEN, INC.
By: /s/ Michael J. Astrue
----------------------------------------
Michael J. Astrue
Vice President - General Counsel
Dated June 28, 1999
<PAGE> 1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Registration
Statement on Form S-8 of Biogen Savings Plan of our report dated June 28, 1999
relating to the financial statements and supplemental schedules of the Biogen
Savings Plan for the year ended December 31, 1998 included with this Form
10-K/A.
PricewaterhouseCoopers LLP
Boston, Massachusetts
June 28, 1999
<PAGE> 1
BIOGEN, INC.
BIOGEN SAVINGS PLAN
FINANCIAL STATEMENTS AND
SUPPLEMENTAL SCHEDULES
DECEMBER 31, 1998 AND 1997
<PAGE> 2
BIOGEN, INC.
BIOGEN SAVINGS PLAN
INDEX TO FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
PAGE
<S> <C>
Report of Independent Accountants 1
Statement of Assets Available for Plan Benefits as 2
of December 31, 1998 and 1997
Statements of Changes in Assets Available for Plan
Benefits (with Fund Information) for the Year Ended
December 31, 1998 and December 31, 1997 3-6
Notes to Financial Statements 7-10
Supplemental Schedules*:
Supplemental Schedule I
Assets Held for Investment as of December 31, 1998 11
Supplemental Schedule II
Transactions Involving Amounts in Excess of 5%
of the Current Value of Plan Assets for the Year
Ended December 31, 1998 12
</TABLE>
* Other schedules have been omitted because such schedules are not applicable.
<PAGE> 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 Biogen Savings Plan (the "Plan") at December 31, 1998 and 1997, and
the changes in assets available for plan benefits for the years ended December
31, 1998 and 1997 in conformity with generally accepted accounting principles.
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
generally accepted auditing standards 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. The fund information in the
statement of changes in assets available for plan benefits is presented for
purposes of additional analysis rather than to present the changes in assets
available for plan benefits of each fund. These supplemental schedules and fund
information are the responsibility of the Plan's management. The supplemental
schedules and fund information 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.
PricewaterhouseCoopers LLP
Boston, MA
June 28, 1999
<PAGE> 4
BIOGEN, INC.
BIOGEN SAVINGS PLAN
STATEMENT OF ASSETS AVAILABLE FOR PLAN BENEFITS
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
December 31,
-----------------------------
ASSETS 1998 1997
- ------ ------------ ------------
<S> <C> <C>
Investments at fair value:
Mutual funds:
Fidelity Intermediate Bond Fund $ 1,226,161 $ 1,184,786
Fidelity Puritan Fund 5,393,202 4,591,063
Fidelity Value Fund 1,002,445 774,097
Fidelity Magellan Fund 9,278,946 6,867,334
Fidelity Retirement Government Money Market Fund 1,632,338 1,525,381
Fidelity Growth Company Fund 7,802,376 5,751,258
Fidelity International Growth Income Fund -- 455,993
Fidelity Asset Manager Fund 1,066,774 663,018
Fidelity US Equity Index Fund 2,677,468 1,679,043
Fidelity US Bond Index Fund 279,121 197,146
Fidelity Low Priced Stock Fund 486,853 111,518
USAA International Fund 535,219 20,983
Janus Worldwide Fund 749,449 170,532
----------- -----------
Total mutual funds 32,130,352 23,992,152
----------- -----------
Biogen Stock Fund:
Biogen, Inc. common stock 8,523,321 3,486,508
Interest bearing cash 174,421 77,153
----------- -----------
Total Biogen, Inc. Stock Fund 8,697,742 3,563,661
----------- -----------
Loans to participants 743,526 707,329
----------- -----------
Total investments 41,571,620 28,263,142
----------- -----------
Assets available for plan benefits $41,571,620 $28,263,142
=========== ===========
</TABLE>
The accompanying notes are an integral part of the financial statements.
2
<PAGE> 5
BIOGEN, INC.
BIOGEN SAVINGS PLAN
STATEMENT OF CHANGES IN ASSETS AVAILABLE FOR PLAN BENEFITS
(WITH FUND INFORMATION)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
YEAR ENDED
DECEMBER 31, 1998
PARTICIPANT DIRECTED
---------------------------------------------------------------------------------------------------------------
FIDELITY
RETIREMENT FIDELITY FIDELITY FIDELITY FIDELITY
FIDELITY FIDELITY FIDELITY FIDELITY GOVERNMENT GROWTH INTERNATIONAL ASSET U.S. EQUITY
INTERMEDIATE PURITAN VALUE MAGELLAN MONEY MARKET COMPANY GROWTH MANAGER INDEX
BOND FUND FUND FUND FUND FUND FUND INCOME FUND FUND FUND
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ADDITIONS
Contributions:
Employee $ 152,792 $ 656,225 $ 212,858 $ 930,736 $ 111,712 $ 954,476 $ 26,285 $ 172,823 $ 449,820
Rollover 37,417 70,647 34,632 191,413 240,729 124,056 4,398 56,518 67,137
Employer -- -- -- -- -- -- -- -- --
---------- --------- ---------- ---------- ---------- ---------- ---------- ---------- ---------
Total contributions 190,209 726,872 247,490 1,122,149 352,441 1,078,532 30,683 229,341 516,957
Net appreciation
(depreciation) of
investments:
Mutual funds 12,604 231,231 (148,518) 1,881,829 -- 1,086,360 29,944 504 472,062
Biogen, Inc. common
stock -- -- -- -- -- -- -- -- --
Interest and dividend
income 79,702 531,015 143,361 420,549 81,601 537,700 -- 147,477 43,580
Other loan repayment 10,646 79,691 4,364 143,795 24,915 119,374 4,594 23,972 18,424
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Total additions 293,161 1,568,809 246,697 3,568,322 458,957 2,821,966 65,221 401,294 1,051,023
DEDUCTIONS
Distributions to
participants (154,828) (496,593) (22,956) (929,234) (103,229) (479,017) (113) (22,961) (138,987)
---------- ---------- --------- ---------- --------- --------- ---------- ---------- ----------
Net increase (decrease)
prior to interfund
transfers and loans 138,333 1,072,216 223,741 2,639,088 355,728 2,342,949 65,108 378,333 912,036
Interfund transfers
and loans (96,958) (270,077) 4,607 (227,476) (248,771) (291,831) (521,101) 25,423 86,389
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Net increase (decrease) 41,375 802,139 228,348 2,411,612 106,957 2,051,118 (455,993) 403,756 998,425
Assets available for
plan benefits,
beginning of year 1,184,786 4,591,063 774,097 6,867,334 1,525,381 5,751,258 455,993 663,018 1,679,043
---------- ---------- ---------- ---------- ---------- ---------- ---------- --------- ----------
Assets available for
plan benefits, end
of year $1,226,161 $5,393,202 $1,002,445 $9,278,946 $1,632,338 $7,802,376 $ -- $1,066,774 $2,677,468
========== ========== ========== ========== ========== ========== ========== ========== ==========
</TABLE>
The accompanying notes are an integral part of the financial statements.
3
<PAGE> 6
BIOGEN, INC.
BIOGEN SAVINGS PLAN
STATEMENTS OF CHANGES IN ASSETS AVAILABLE FOR PLAN BENEFITS
(WITH FUND INFORMATION)(CONTINUED)
================================================================================
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1998
PARTICIPANT DIRECTED
----------------------------------------------------------------------------------------------
FIDELITY
FIDELITY U.S. LOW-PRICED USAA JANUS
BOND INDEX STOCK INTERNATIONAL WORLDWIDE LOAN BIOGEN, INC.
FUND FUND FUND FUND FUND STOCK FUND TOTAL
------------ ---------- ------------- --------- --------- ---------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
ADDITIONS
Contributions:
Employee $ 58,255 $167,490 $131,749 $165,229 $ -- $ 38,178 $ 4,228,628
Rollover 9,528 70,092 17,333 61,525 -- 86,150 1,071,575
Employer -- -- -- -- -- 620,721 620,721
--------- -------- -------- -------- --------- ---------- -----------
Total contributions 67,783 237,582 149,082 226,754 -- 745,049 5,920,924
Net appreciation (depreciation)
of investments:
Mutual funds 4,297 (43,827) (26,312) 79,839 -- -- 3,580,013
Biogen, Inc. common stock -- -- -- -- -- 4,654,644 4,654,644
Interest and dividend income 12,866 34,906 18,847 2,954 -- -- 2,054,558
Other loan repayment 3,318 968 19,018 2,249 (393,660) -- 61,668
--------- -------- -------- -------- --------- ---------- -----------
Total additions 88,264 229,629 160,635 311,796 (393,660) 5,399,693 16,271,807
DEDUCTIONS
Distributions to participants (154,415) (18,330) (33,650) (31,226) (16,420) (361,370) (2,963,329)
--------- -------- -------- -------- --------- ---------- -----------
Net increase (decrease) prior to
interfund transfers and loans (66,151) 211,299 126,985 280,570 (410,080) 5,038,323 13,308,478
Interfund transfers and loans 148,126 164,036 387,251 298,347 446,277 95,758 --
--------- -------- -------- -------- --------- ---------- -----------
Net increase 81,975 375,335 514,236 578,917 36,197 5,134,081 13,308,478
Assets available for plan
benefits, beginning of year 197,146 111,518 20,983 170,532 707,329 3,563,661 28,263,142
--------- -------- -------- -------- --------- ---------- -----------
Assets available for plan
benefits, end of year $ 279,121 $486,853 $535,219 $749,449 $ 743,526 $8,697,742 $41,571,620
========= ======== ======== ======== ========= ========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
4
<PAGE> 7
BIOGEN, INC.
BIOGEN SAVINGS PLAN
STATEMENTS OF CHANGES IN ASSETS AVAILABLE FOR PLAN BENEFITS
(WITH FUND INFORMATION)(CONTINUED)
================================================================================
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1997
PARTICIPANT DIRECTED
---------------------------------------------------------------------------------------------------------------
FIDELITY
RETIREMENT FIDELITY FIDELITY FIDELITY FIDELITY
FIDELITY FIDELITY FIDELITY FIDELITY GOVERNMENT GROWTH INTERNATIONAL ASSET U.S. EQUITY
INTERMEDIATE PURITAN VALUE MAGELLAN MONEY MARKET COMPANY GROWTH MANAGER INDEX
BOND FUND FUND FUND FUND FUND FUND INCOME FUND FUND FUND
------------ -------- -------- -------- ------------ -------- ------------ -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
ADDITIONS
Contributions:
Employee $ 136,470 $ 636,147 $108,506 $ 854,609 $ 116,702 $ 956,584 $ 176,161 $130,312 $ 276,459
Rollover 89,268 134,265 94,989 179,750 150,629 142,438 71,025 57,876 86,356
Employer -- -- -- -- -- -- -- -- --
---------- ---------- -------- ---------- ---------- ---------- --------- -------- ----------
Total
contributions 225,738 770,412 203,495 1,034,359 267,331 1,099,022 247,186 188,188 362,815
Net appreciation
(depreciation)
of investments:
Mutual funds 9,109 428,934 (16,488) 995,802 -- 338,019 2,593 51,161 317,955
Biogen, Inc.
common stock -- -- -- -- -- -- -- -- --
Interest and dividend
income 67,233 357,612 101,824 441,449 75,119 544,275 28,757 67,843 33,173
Other loan repayment 10,654 79,695 332 114,767 8,271 77,331 4,852 6,162 3,228
---------- ---------- -------- ---------- ---------- ---------- --------- -------- ----------
Total additions 312,734 1,636,653 289,163 2,586,377 350,721 2,058,647 283,388 313,354 717,171
DEDUCTIONS
Distributions to
participants (111,084) (258,837) (13,422) (512,085) (74,065) (339,838) (40,615) (30,546) (42,721)
---------- ---------- -------- ---------- ---------- ---------- --------- -------- ----------
Net increase prior
to interfund
transfers
and loans 201,650 1,377,816 275,741 2,074,292 276,656 1,718,809 242,773 282,808 674,450
Interfund transfers
and loans (122,564) (95,886) 415,007 (536,172) 4,035 (610,422) (219,468) 23,565 274,598
---------- ---------- -------- ---------- ---------- ---------- --------- -------- ----------
Net increase 79,086 1,281,930 690,748 1,538,120 280,691 1,108,387 23,305 306,373 949,048
Assets available for
plan benefits,
beginning of year 1,105,700 3,309,133 83,349 5,329,214 1,244,690 4,642,871 432,688 356,645 729,995
---------- ---------- -------- ---------- ---------- ---------- --------- -------- ----------
Assets available for
plan benefits,
end of year $1,184,786 $4,591,063 $774,097 $6,867,334 $1,525,381 $5,751,258 $ 455,993 $663,018 $1,679,043
========== ========== ======== ========== ========== ========== ========= ======== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
5
<PAGE> 8
BIOGEN, INC.
BIOGEN SAVINGS PLAN
STATEMENTS OF CHANGES IN ASSETS AVAILABLE FOR PLAN BENEFITS
(WITH FUND INFORMATION)(CONTINUED)
================================================================================
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31, 1997
---------------------------------------------------------------------------------
NON-PARTICIPANT
PARTICIPANT DIRECTED DIRECTED
----------------------------------------------------------------- ---------------
FIDELITY FIDELITY USAA
U.S. LOW-PRICED INTER- JANUS
BOND INDEX STOCK NATIONAL WORLDWIDE LOAN BIOGEN, INC. BIOGEN, INC.
FUND FUND FUND FUND FUND STOCK FUND STOCK TOTAL
-------- -------- -------- -------- --------- ---------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
ADDITIONS
Contributions:
Employee $ 32,752 $ 2,274 $ 258 $ 4,278 $ -- $ -- $ -- $ 3,431,512
Rollover 43,062 6,009 -- 6,509 -- -- -- 1,062,176
Employer -- -- -- -- -- 8,075 474,305 482,380
-------- -------- -------- -------- --------- ---------- ----------- -----------
Total contributions 75,814 8,283 258 10,787 -- 8,075 474,305 4,976,068
Net appreciation (depreciation)
of investments:
Mutual funds 3,680 451 (880) (9,828) -- -- -- 2,120,508
Biogen, Inc. common stock -- -- -- -- -- 85,697 (315,390) (229,693)
Interest and dividend income 7,855 913 1,081 11,616 -- -- 700 1,739,450
Other loan repayment 551 -- -- -- (257,280) -- -- 48,563
-------- -------- -------- -------- --------- ---------- ----------- -----------
Total additions 87,900 9,647 459 12,575 (257,280) 93,772 159,615 8,654,896
DEDUCTIONS
Distributions to participants (13,167) -- -- -- (14,714) -- (218,278) (1,669,372)
-------- -------- -------- -------- --------- ---------- ----------- -----------
Net increase (decrease) prior
to interfund
transfers and loans 74,733 9,647 459 12,575 (271,994) 93,772 (58,663) 6,985,524
Interfund transfers and loans 82,561 101,871 20,524 157,957 504,394 3,469,889 (3,469,889) --
-------- -------- -------- -------- --------- ---------- ----------- -----------
Net increase (decrease) 157,294 111,518 20,983 170,532 232,400 3,563,661 (3,528,552) 6,985,524
Assets available for plan
benefits, beginning of year 39,852 -- -- -- 474,929 -- 3,528,552 21,277,618
-------- -------- -------- -------- --------- ---------- ----------- -----------
Assets available for plan
benefits, end of year $197,146 $111,518 $ 20,983 $170,532 $ 707,329 $3,563,661 $ -- $28,263,142
======== ======== ======== ======== ========= ========== =========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
6
<PAGE> 9
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").
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.
INVESTMENT OF CONTRIBUTIONS
Company matching contributions are invested in the Biogen, Inc. Stock
Fund. Prior to December 5, 1997, the matching contribution was invested
directly in Biogen, Inc. stock. On December 5, 1997 the amounts in the
stock account were converted into units of the Biogen, Inc. Stock Fund
which 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:
* An intermediate bond fund designed to earn a high level of current
return. It is invested in Fidelity's Intermediate Bond Fund.
* 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.
* 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 the Fidelity Value Fund.
* An aggressive growth fund invested which seeks to achieve capital
appreciation. It is invested in Fidelity's Magellan Fund.
* 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.
7
<PAGE> 10
BIOGEN, INC.
BIOGEN SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
* 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.
* An international equity fund which seeks capital growth, current
income and growth of income. It is invested in the Fidelity
International Growth & Income Fund.
* An asset allocation fund that seeks total return with reduced risk
over the long term. It is invested in the Fidelity Asset Manager
Fund.
* 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.
* 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.
The Plan added the following investment options effective October 1,
1997:
* 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.
* 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.
* 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.
The Plan added the following investment option effective January 1,
1998.
* 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. Note: Prior to January 1, 1998 only the employer match
was invested in Biogen, Inc. stock.
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.
8
<PAGE> 11
BIOGEN, INC.
BIOGEN SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
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.
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 generally
accepted accounting principles 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 generally accepted accounting principles
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.
9
<PAGE> 12
BIOGEN, INC.
BIOGEN SAVINGS PLAN
NOTES TO FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
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 ("ERISA").
3. LOANS TO PARTICIPANTS
At December 31, 1998 and 1997, the Plan had loans receivable from
participants aggregating $743,526 and $707,329, 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.
10
<PAGE> 13
BIOGEN, INC. SUPPLEMENTAL SCHEDULE I
BIOGEN SAVINGS PLAN
ASSETS HELD FOR INVESTMENT (ITEM 27a, FORM 5500)
DECEMBER 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
NUMBER OF
SHARES/ CURRENT
UNITS COST VALUE
<S> <C> <C>
119,393 Fidelity Intermediate Bond Fund* $1,214,863 $1,226,161
268,720 Fidelity Puritan Fund* 4,726,490 5,393,202
21,628 Fidelity Value Fund* 1,172,750 1,002,445
76,800 Fidelity Magellan Fund* 6,509,795 9,278,946
Fidelity Retirement Government Money
1,632,338 Market Fund* 1,632,338 1,632,338
152,928 Fidelity Growth Company Fund* 5,944,521 7,802,376
-- Fidelity International Growth Income Fund* -- --
57,108 Fidelity Asset Manager Fund* 1,019,090 1,066,774
60,907 Fidelity U.S. Equity Index Fund* 1,978,805 2,677,468
25,329 Fidelity US Bond Index Fund* 273,440 279,121
21,307 Fidelity Low Priced Stock Fund* 526,460 486,853
27,717 USAA International Fund 562,683 535,219
15,824 Janus Worldwide Fund 682,152 749,449
------------ ------------
Total mutual funds 26,243,387 32,130,352
------------ ------------
102,703 Biogen, Inc. common stock* 2,726,578 8,523,321
174,421 Interest bearing cash 174,421 174,421
------------ ------------
Total Biogen, Inc. Stock Fund 2,900,999 8,697,742
------------ ------------
Loans to participants* 743,526 743,526
------------ ------------
Total $ 29,887,912 $ 41,571,620
============ ============
</TABLE>
* Party-in-interest.
11
<PAGE> 14
BIOGEN, INC. SUPPLEMENTAL SCHEDULE II
BIOGEN SAVINGS PLAN
TRANSACTIONS INVOLVING AMOUNTS IN EXCESS OF 5% OF CURRENT VALUE OF PLAN ASSETS
(ITEM 27d, FORM 5500)
YEAR ENDED DECEMBER 31, 1998
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION> CURRENT
NUMBER VALUE ON
OF PURCHASE SELLING LEASE EXPENSE HISTORICAL TRANSACTION
PARTY INVOLVED DESCRIPTION OF ASSET TRANSACTIONS PRICE PRICE RENTAL INCURRED COST DATE GAIN (LOSS)
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Fidelity Management Fidelity Puritan Fund 108 $1,493,901 $ $ $ $ $1,493,901 $
Trust Company 73 922,993 783,298 922,993 139,695
Fidelity Management Fidelity Magellan Fund 135 1,964,854 1,964,854
Trust Company 88 1,435,070 1,099,171 1,435,070 335,899
Fidelity Management Fidelity Growth Company 124 1,840,042 1,840,042
Trust Company 85 875,284 711,786 875,284 163,498
</TABLE>
12
