Analyst Conference Summary

conference date: July 24, 2007 @ 5:30 AM Pacific Time
for quarter ending: June 30, 2007 (2nd quarter)

Forward-looking statements

Overview: Good quarter overall with very strong sequential GAAP net income growth.

Basic data:

Revenue was $773 million, up 8% sequentially from $716 million and up 17% from $660 million year-earlier.

GAAP net income was $186 million, up 41% sequentially from $132 million and up from a $171 million loss in Q2 2006.

Non-GAAP net income was $240 million, up 22% from year-earlier.

Earnings per share (GAAP EPS) were $0.54, well up from a loss of $0.50 per share year earlier.

Non-GAAP EPS was $0.70, up 23% from year-earlier.

Guidance:

Increased guidance for full 2007 to revenue growth over 2006 of 16% to 18%. Non-GAAP EPS between $2.60 and $2.70. This includes impact of recent tender offer, which will increase shares to the 290 to 296 million range.

Capital expenditures will range from $250 to $300 million.

GAAP EPS for the full year is estimated between $1.84 and $1.94.

Conference Highlights:

Strong results were driven by sales of Tysabri. Added Lixivaptan for hyponatremia to pipeline (going into Phase III) through a joint agreement with Cardiokine. Good European launches of Tysabri.

Non-GAAP figures exclude the following: $61 million amortization of intangibles from merger; share-based compensation expense of $8 million; tax benefit of $16 million.

Avonex for multiple sclerosis (MS) revenues increased 8% to $462 million. Of that U.S. sales were $270 million and international sales were $192 million.

Rituxan joint venture with Genentech: U.S. sales by Genentech were $582 million. Revenues from the joint venture were $230.6 million.

Tysabri revenue was $48 million. Physicians are continuing to prescribe for new patients. 14,000 global patients in July. Significant opportunities remain in U.S. 4 of 5 new patients are new to BIIB products. Most international sales were in Germany and Sweden. France launched in early June.

Fumaderm revenues were $5 million, about 2 months of revenue.

Royalties were $23 million, up 28% from year-earlier. Other income was $32 million.

No shares were repurchased during quarter. Share repurchases of $3 billion were completed on July 2, in Q3.

Reiterated prior announcements of new study plans and Tysabri study results. Now has 15 ongoing or planned Phase II studies. 2008 should be a key data result year. On July 2nd NICE (National Institute for Health and Clinical Excellence) recommended Tysabri for treatment of MS. Reminded us they have 4 potential new MS drugs in their pipeline. This should result in reimbursement allowance in Britain later this year.

Tysabri for Crone's Disease was disallowed in Europe, BIIB will appeal.

Cost of sales were $84.1 million. R&D $218.1 million. SG&A $203.6 million. Amortization $61.0 million.

Cash and equivalents ended at $1.8 billion.

Effective tax rate has improved. Q2 rate was 22%. IRS completed 2003-2004 audit. Increasing ratio of international income reduces tax rate. Balance effective rate 28 to 30%.

Cardiokine acquisition should complete in Q3 and will entail a $50 million acquisition charge.

Interest income will decrease and will start paying interest on $1.5 billion used for tender offer.

Q&A:

New patient adds for Tysabri? Sees steady adds and occasional blips upward in recent weeks. Discontinuations are running at a steady rate; usually because of hypersensitivity reactions.

Tysabri for Crones? Looking for both induction and maintenance. Have a number of different populations; data was presented in past. Efficacy is preserved across groups, even known refractory groups.

Market share? Avonex is mid-30s and holding nicely. Tysabri around 4% and is picking up over time.

Crones decision in Europe? FDA and European processes are very different, so Euro result is not necessarily an indicator for U.S. Too early to talk about follow-on trials.

Avonex to Tysabri switchers? That has declined, Tysabri is growing mainly through new MS patients (4%) and switches from competitors.

Margins going forward? We have an unusual mix of product deals, so margins are blended and won't change dramatically over time.

Expenses going forward may decrease compared to revenues even as we move pipeline forward. We do have milestone payments that should come due on a regular basis, but these are not really underlying.

Japan launch? Not a lot of volume in Japan as MS market, only 10,000 to 12,000 patients, but we do have an organization in Japan that is important.

Tysabri physician numbers? Adding about 100 per month. Number of patients per physician are also growing. Physicians often try one patient before doing the lot.

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