Reaffirming Earnings Guidance for 2001, Biogen Seeks Recovery for Schering’s Unpaid Royalties on Alpha Interferon Products

Biogen, Inc. (NASDAQ/BGEN) today announced it has filed with the American Arbitration Association to pursue claims against Schering-Plough Corporation, which unilaterally discontinued U.S. alpha interferon royalty payments to Biogen in January 2001. Schering-Plough is the exclusive licensee of Biogen’s alpha interferon patents, and Biogen’s claims relate to sales of Schering-Plough’s Intron A® and PegIntron® products.

The arbitration’s purpose is to compel Schering-Plough to pay Biogen for unpaid royalties on US sales of Intron A® and PegIntron® for the period from January 2001 to July 2002. Additionally, Biogen is using the arbitration process to preempt any potential future dispute with Schering-Plough regarding royalty payments commencing July 2002. Schering-Plough’s obligation to pay royalties commencing in July 2002 arises under a lawsuit settlement agreement related to a Roche/Genentech-owned U.S. patent application.

Biogen today reaffirmed that it expects earnings for 2001 in the range of $1.90 to $1.92 diluted earnings per share. Since January 2001, Biogen has not recognized any royalties related to Intron A® and PegIntron®. Biogen’s 2001 earnings guidance has consistently excluded royalty payments from Schering-Plough. Total royalties for Biogen in 2001 will comprise slightly more than five percent of total revenues.

“Given Schering-Plough’s history of taking aggressive positions in contract interpretation and forcing matters into arbitration, Biogen wants to achieve a definitive resolution of all outstanding and potential royalty issues,” said Tom Bucknum, vice president and general counsel at Biogen. “We believe the arbitrators will recognize Biogen’s rights and Schering-Plough’s obligations.”

In addition to historical facts, this press release contains forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those reflected in the forward-looking statements. Reference is made in particular to statements regarding the Company’s view as to the possible outcome of arbitration proceedings as well as statements regarding anticipated revenues and earnings for the year. Factors which could cause actual financial results to differ from the Company’s current expectations include, without limitation, the impact of competitive products on AVONEX® (Interferon beta-1a) sales, any change in market acceptance for AVONEX in key markets worldwide, any unexpected negative results related to AVONEX and the other risks and uncertainties associated with drug development and commercialization described in the Company’s periodic reports filed with the Securities and Exchange Commission. Factors which could cause actual results related to the outcome of the arbitration to differ materially from the Company’s current expectations include the risk that the arbitration panel will interpret the contract differently than Biogen does or that other determinations or decisions adverse to the Company will be made during the course of the arbitration.

Biogen, Inc., winner of the U.S. National Medal of Technology, is a biopharmaceutical company principally engaged in discovering and developing drugs for human healthcare through genetic engineering. Headquartered in Cambridge, MA, the Company’s revenues are generated from international sales of AVONEX® (Interferon beta-1a) for treatment of relapsing forms of multiple sclerosis, and from the worldwide sales by licensees of a number of products, including alpha interferon and hepatitis B vaccines and diagnostic products( Prescribing Information ). Biogen’s research and development activities are focused on novel products to treat inflammatory and autoimmune diseases, neurological diseases, cancer, fibrosis and congestive heart failure. The Company maintains active clinical research programs in protein therapeutics, small molecules, genomics and gene therapy. For copies of press releases and additional information about the Company, please consult Biogen’s Homepage on the World Wide Web at

AVONEX® (Interferon beta-1a) is a registered trademark of Biogen, Inc. AVONEX is approved in the U.S. and in most other countries around the world for the treatment of relapsing forms of multiple sclerosis. Intron A® and PegIntron® are registered trademarks of Schering-Plough Corporation.