BIOMARIN PHARMACEUTICAL INC

(1)BUSINESS OVERVIEW AND SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

BioMarin Pharmaceutical Inc. (the Company or BioMarin) is a global biotechnology company dedicated to translating the promise of genetic discovery into medicines that make a profound impact on the life of each patient. The San Rafael, California-based company, founded in 1997, has a proven track record of innovation with eight commercial therapies and a strong clinical and preclinical pipeline. Using a distinctive approach to drug discovery and development, BioMarin pursues treatments that offer new possibilities for patients and families around the world navigating rare or difficult to treat genetic conditions.

Basis of Presentation

These Consolidated Financial Statements have been prepared pursuant to United States generally accepted accounting principles (U.S. GAAP) and the rules and regulations of the Securities and Exchange Commission (the SEC) for Annual Reports on Form 10-K and include the accounts of BioMarin and its wholly owned subsidiaries. All intercompany transactions have been eliminated. Management performed an evaluation of the Company’s activities through the date of filing of this Annual Report on Form 10-K, and has concluded that there were no subsequent events or transactions that occurred subsequent to the balance sheet date and prior to the filing of this Annual Report on Form 10-K.

Effective January 1, 2024, the Company changed its presentation for foreign currency transaction gains and losses resulting from remeasurement and idle plant costs within its Consolidated Statements of Income. Effective with this change in presentation, foreign currency transaction gains and losses resulting from remeasurement are presented in Other Expense, Net and idle plant costs are presented in Cost of Sales. Prior to this change in presentation, both foreign currency transaction gains and losses resulting from remeasurement and idle plant costs were presented in Selling, General and Administrative (SG&A) expense. The Company believes that this change in presentation is preferable because the revised presentation is more consistent with how management measures the Company’s operating performance. The change in presentation had no impact to Net Income, Total Stockholders’ Equity or earnings per share for the twelve months ended December 31, 2023 or 2022.

Prior period amounts on the Consolidated Statements of Income were revised to conform to current period presentation. The following table reflects the impacts of the change in presentation for the prior periods presented.

Use of Estimates

U.S. GAAP requires management to make estimates and assumptions that affect amounts reported on the Company’s Consolidated Financial Statements and accompanying disclosures. Although these estimates are based on management’s best knowledge of current events and actions that the Company may undertake in the future, actual results may be different from those estimates. The Consolidated Financial Statements reflect all adjustments of a normal, recurring nature that are, in the opinion of management, necessary for a fair presentation of results.

Significant Accounting Policies

Cash and Cash Equivalents

The Company treats highly liquid investments, readily convertible to cash, with original maturities of three months or less on the purchase date as cash equivalents.

Marketable and Non-Marketable Securities

Marketable Securities

The Company determines the appropriate classification of its investments in debt and equity securities at the time of purchase and reevaluates such designations at each reporting period. The Company classifies its debt and equity securities with original maturities greater than three months when purchased as either short-term or long-term investments based on each instrument’s underlying contractual maturity date and its availability for use in current operations.

All marketable securities are classified as available-for-sale. Available-for-sale debt securities are measured and recorded at fair market value with unrealized gains and losses included in Accumulated Other Comprehensive Income (AOCI) on the Company’s Consolidated Balance Sheets, with the exception of any declines in fair value below the cost basis that are a result of a credit loss, which, if any, are reported in Other income (expense), net in the current period through an allowance for credit losses. Impairment assessments are made at the individual security level each reporting period. When the fair value of an investment is less than its cost at the balance sheet date, a determination is made as to whether the impairment is related to a credit loss and, if so, an impairment loss is recognized in earnings equal to the difference between the investment’s amortized cost and fair value at such date.

Non-Marketable Equity Securities

The Company records investments in equity securities, other than equity method investments, at fair market value, if fair value is readily determinable. Equity securities with no readily determinable fair values are recorded using the measurement alternative of cost adjusted for observable price changes in orderly transactions for identical or similar investments of the same issuer less impairment, if any. Investments in equity securities are recorded in Other Assets on the Company's Consolidated Balance Sheets. Unrealized gains and losses are reported in Other income (expense), net. The Company regularly reviews its non-marketable equity securities for indicators of impairment.

Inventory

The Company values inventory at the lower of cost and net realizable value and determines the cost of inventory using the average-cost approach on the first-in, first out (FIFO) method. The Company analyzes its inventory levels quarterly for obsolescence and, if required, adjusts inventory to its net realizable value if the cost basis of inventory is in excess of its expected net realizable value, or for quantities in excess of expected demand. If the Company determines cost exceeds its net realizable value, the resulting adjustments are recognized as Cost of Sales in the Consolidated Statements of Income.

Property, Plant and Equipment

Property, plant and equipment are stated at historical cost net of accumulated depreciation. Depreciation is computed using the straight-line method over the related estimated useful lives, as presented in the table below. Significant additions and improvements are capitalized, whereas repairs and maintenance are expensed as incurred. Depreciation of property, plant and equipment are included in Cost of Sales, Research and Development (R&D) and SG&A, as appropriate, in the Consolidated Statements of Income. Property and equipment purchased for specific R&D projects with no alternative future uses are expensed as incurred and recorded to R&D in the Consolidated Statements of Income.

Leases

The Company's lease portfolio primarily consists of leases for properties and equipment for administrative, manufacturing and R&D activities. The Company determines if an arrangement is a lease at contract inception. For leases where the Company is the lessee, Right of Use (ROU) assets represent the Company’s right to use the underlying asset for the term of the lease and the lease liabilities represent the lease payment obligation. ROU assets and lease liabilities are recognized at the lease commencement date based on the present value of the future lease payments over the lease term. The Company uses its incremental borrowing rate based on the information available at the commencement date of the underlying lease arrangement to determine the present value of lease payments. The ROU asset also includes any prepaid lease payments and any lease incentives received. The lease term to calculate the ROU asset and related lease liability includes options to extend or terminate the lease when it is reasonably certain that the Company will exercise the option. The Company’s lease agreements generally do not contain any material variable lease payments, residual value guarantees or restrictive covenants.

Lease expense for operating leases is recognized on a straight-line basis over the lease term as an operating expense while expense for financing leases is recognized as depreciation expense and interest expense using the accelerated interest method of recognition. When an arrangement requires payments for lease and non-lease components, the Company has elected to account for lease and non-lease components separately. Lease expense for leases with a term of twelve months or less is recognized on a straight-line basis and are not included in the recognized ROU assets and lease liabilities.

Goodwill and Intangible Assets

The Company records goodwill in a business combination when the total consideration exceeds the fair value of the assets acquired.

Intangible assets with indefinite useful lives are related to purchased in-process research and development (IPR&D) projects and are measured at their respective fair values as of the acquisition date. Intangible assets related to IPR&D projects are considered to be indefinite-lived until the completion or abandonment of the associated R&D efforts. If and when development is complete, which generally occurs if and when regulatory approval to market a product is obtained, the associated assets are considered finite-lived and are amortized using the straight-line method based on their respective estimated useful lives at that point in time. The amortization of these intangible assets is included in Intangible Asset Amortization in the Consolidated Statements of Income.

Intangible assets with finite useful lives primarily consist of acquired intellectual property and royalty rights, regulatory approval and first commercial sales milestone payments as well as costs associated with technology transfer to qualify third-party manufacturing facilities for commercial production. Intangible assets are recorded at cost, net of accumulated amortization, and amortize over their estimated useful lives on a straight-line basis. Amortization expense is recorded in Intangible Asset Amortization on the Company's Consolidated Statements of Income, except for amortization expense related to the technology transfer, which is recorded in Cost of Sales.

Impairment

The Company assesses goodwill and indefinite-lived intangible assets for impairment annually in the fourth quarter, or more frequently as warranted by events or changes in circumstances that indicate that the carrying amount may not be recoverable.

Goodwill is assessed for impairment by comparing the fair value of the Company’s reporting unit with its carrying amount. If the carrying value of the reporting unit exceeds its fair value, an impairment loss equal to the difference would be recorded.

Indefinite-lived intangible assets are assessed for impairment first by performing a qualitative assessment. If the qualitative assessment indicates that it is more likely than not that the fair value of an indefinite-lived intangible asset is less than its carrying amount, then the Company will perform a quantitative assessment and record an impairment loss.

Long-lived Asset Impairment

The Company’s long-lived assets consist of property, plant and equipment, lease ROU assets and finite-lived intangible assets, which includes costs associated with technology transfer to qualify manufacturing facilities for commercial production. Should there be an indication of impairment, the Company tests for recoverability by comparing the estimated undiscounted future cash flows expected to result from the use of the asset or asset group and its eventual disposition to the carrying amount of the asset or asset group. Any excess of the carrying value of the asset or asset group over its estimated fair value is recognized as an impairment loss. Impairment charges related to property, plant or equipment that are not material are recorded to depreciation expense and presented in SG&A in the Consolidated Statements of Income. Impairment charges for finite-lived intangible assets associated with technology transfer costs that are not material are recorded to Cost of Sales in the Consolidated Statements of

Income. Impairment charges related to all other finite-lived intangible assets that are not material are recorded to Intangible Asset Amortization in the Consolidated Statements of Income.

Capitalized Software

The Company capitalizes software development costs associated with internal use software, including external direct costs of materials and services and payroll costs for employees devoting time to a software project. Costs incurred during the preliminary project stage, as well as costs for maintenance and training, are expensed as incurred. When placed in service, implementation costs are subsequently amortized on a straight-line basis over the expected useful life of the asset. As of December 31, 2024 and 2023, $72.1 million and $30.6 million of capitalized costs associated with cloud computing arrangements were included in Other Assets on the Company’s Consolidated Balance Sheets.

Revenue Recognition

The Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which the Company expects to receive in exchange for those goods or services. To determine revenue recognition for contracts with customers, the Company performs the following five steps:

(i)identification of the promised goods or services in the contract;

(ii)determination of whether the promised goods or services are performance obligations including whether they are distinct in the context of the contract;

(iii)measurement of the transaction price, including the constraint on variable consideration;

(iv)allocation of the transaction price to the performance obligations based on estimated selling prices; and

(v)recognition of revenue when (or as) the Company satisfies each performance obligation. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account.

Net Product Revenues

In the U.S., the Company’s commercial products, except for PALYNZIQ and ALDURAZYME, are generally sold to specialty pharmacies or end-users, such as hospitals, which act as retailers. PALYNZIQ is distributed in the U.S. through certain certified specialty pharmacies under the PALYNZIQ Risk Evaluation and Mitigation Strategy (REMS) and ALDURAZYME is marketed world-wide by Sanofi. Outside the U.S., the Company’s commercial products are sold to its authorized distributors or directly to government purchasers or hospitals, which act as the end-users. Revenues from product sales are recognized when the customer obtains control of the Company’s product, which occurs at a point in time, typically upon shipment to the customer. The Company's payment terms vary by customer, jurisdiction or, in some instances, by product. With the exception of Sanofi and certain outcomes-based contracts, most of the Company's payment terms are based on customary commercial terms and are generally less thanone year after the customer obtains control. The Company does not adjust revenue for the effects of a significant financing component for contracts if the period between the transfer of control and corresponding payment is expected to beone year or less. Amounts collected from customers and remitted to governmental authorities, which primarily consist of value-added taxes related to product sales in foreign jurisdictions, are presented on a net basis on the Company’s Consolidated Statements of Income, in that taxes billed to customers are not included as a component of Net Product Revenues.

For ALDURAZYME revenues, the Company receives a payment ranging from 39.5% to 50% on worldwide net ALDURAZYME sales by Sanofi depending on sales volume, which is included in Net Product Revenues on the Company’s Consolidated Statements of Income. The Company recognizes its best estimate of the revenue it expects to earn when the product is released and control is transferred to Sanofi. The Company records ALDURAZYME net product revenues based on the estimated variable consideration payable when the product is sold through by Sanofi. Actual amounts of consideration ultimately received may differ from the Company’s estimates. Differences between the estimated variable consideration to be received from Sanofi and actual payments received are not expected to be material. If actual results vary from the Company’s estimates, the Company will make adjustments, which would affect Net Product Revenues and earnings in the period such variances become known.

Revenue Reserves

Revenues from product sales are recorded at the net sales price (transaction price), which includes estimates of variable consideration for which reserves are established and which result from government and commercial rebates, chargebacks, sales returns, and other incentives that are offered within contracts between the Company and its customers, such as specialty pharmacies, hospitals, authorized distributors and government purchasers. These reserves are based on the amounts earned or to be claimed on the related sales and are classified as reductions of accounts receivable (if the amount is payable to the customer) or a current liability (if the amount is payable to a party other than a customer). Where appropriate, these estimates take into consideration a range of possible outcomes that are probability-weighted for relevant factors such as the Company’s historical experience, current contractual and statutory requirements, specific known market events and trends, patient outcomes, industry data and forecasted customer buying and payment patterns. Overall, these reserves reflect the Company’s best estimates of the amount of consideration to which it is entitled based on the terms of the contract. The amount of variable consideration that is included in the transaction price may be constrained and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in a future period. Actual amounts of consideration ultimately received may differ from the Company’s estimates, however the Company does not expect any such difference to be material. If actual results in the future vary from the Company’s estimates, the Company will adjust its estimates, which would affect net product revenue and earnings in the period such variances become known.

Government and Commercial Rebates: The Company records reserves for rebates payable under government programs, such as Medicaid, and commercial arrangements, such as managed care rebates, as a reduction of revenue at the time product revenues are recorded. The Company’s reserve calculations require estimates, including estimates of customer mix and patient outcomes, to determine which sales will be subject to rebates and the amount of such rebates. The Company updates its estimates and assumptions on a quarterly basis and records any necessary adjustments to its reserves.

Sales Returns: The Company records allowances for product returns, if appropriate, as a reduction of revenue at the time product sales are recorded. Several factors are considered in determining whether an allowance for product returns is required, including market exclusivity of the products based on their orphan drug status, the patient population, the customers’ limited return rights and the Company’s historical experience with returns. Because of the pricing of the Company’s commercial products, the limited number of patients and the customers’ limited return rights, most customers and retailers carry a limited inventory. The Company relies on historical return rates to estimate a reserve for returns. Based on these factors and the fact that the Company has not experienced significant product returns to date, return allowances are not material.

Other Incentives: Other incentives include fees paid to the Company’s distributors and discounts for prompt payment. The Company also offers a branded co-pay assistance program for eligible patients with commercial insurance in the U.S. who are on an eligible BioMarin product. The branded co-pay assistance programs assist commercially insured patients who have coverage for an eligible BioMarin product and are intended to reduce each participating patient’s portion of the financial responsibility of the purchase price up to a specified dollar amount of assistance. The Company records fees paid to distributors, cash discounts and amounts paid under the brand specific co-pay assistance program for each patient as a reduction of revenue.

Royalty and Other Revenues

Royalties: For arrangements that include the receipt of sales-based royalties, including milestone payments based on the level of sales when the license is deemed to be the predominant item to which the royalties relate, the Company recognizes revenue at the later of (a) when the related sales occur, or (b) when the performance obligation to which some or all of the royalty has been allocated has been satisfied (or partially satisfied).

Licenses of intellectual property: If the license to the Company’s intellectual property is determined to be distinct from the other performance obligations identified in the arrangement, the Company recognizes revenues from non-refundable, up-front fees allocated to the license when the license is transferred to the customer and the customer is able to use and benefit from the license. For licenses that are bundled with other promises, the Company uses judgment to assess the nature of the combined performance obligation to determine whether the combined performance obligation is satisfied over time or at a point in time and, if over time, the appropriate method of measuring progress for purposes of recognizing revenue from non-refundable, up-front fees. The Company evaluates the measure of progress each reporting period and, if necessary, adjusts the measure of performance and related revenue recognition.

Milestone payments: At the inception of each arrangement that includes developmental, regulatory or commercial milestone payments, the Company evaluates whether achieving the milestones is considered probable and estimates the amount to be included in the transaction price using the most likely amount method. If it is probable that a significant revenue reversal would not occur, the value of the associated milestone (such as a regulatory submission by the Company) is included in the transaction price. Milestone payments that are not within the control of the Company, such as approvals from regulators or where attainment of the specified event is dependent on the development activities of a third party, are not considered probable of being achieved until those approvals are received or the specified event occurs. Revenue is recognized from the satisfaction of performance obligations in the amount billable to the customer.

Research and Development

R&D costs are generally expensed as incurred. These expenses include contract R&D services provided by third parties, preclinical and clinical studies, raw materials costs associated with manufacturing clinical product, quality control and assurance, other R&D activities, facilities and regulatory costs and R&D-related personnel costs including salaries, benefits and stock-based compensation. Upfront and milestone payments made to third parties in connection with licensed intellectual property, which does not have an alternative future use or does not reach technological feasibility, are expensed as incurred up to the point of regulatory approval. Advance payments for goods or services for use in research and development activities are capitalized and recorded in other current assets, and then expensed as the related goods are delivered or the services are performed.

Advertising Expenses

The costs of advertising are presented in SG&A in the Consolidated Statements of Income and are expensed as incurred. Advertising expenses were $34.5 million, $27.8 million and $25.2 million in 2024, 2023 and 2022, respectively.

Earnings Per Common Share

Basic earnings per share is calculated by dividing Net Income by the weighted average shares of common stock outstanding during the period. Diluted earnings per share reflects the potential dilution that would occur if securities or other contracts to issue common stock were exercised or converted into common stock; however, potential common stock equivalent shares are excluded if their effect is anti-dilutive.

Stock-Based Compensation

The Company has equity incentive plans under which various types of equity-based awards may be granted to employees. Stock-based compensation expense is recognized on a straight-line basis over the requisite service period, which is generally the vesting period required to obtain full vesting, and is classified as Cost of Sales, R&D or SG&A, as appropriate, in the Consolidated Statements of Income. The Company accounts for forfeitures as they occur.

Restricted Stock Units

The fair value of restricted stock units (RSUs) with service-based vesting conditions and RSUs with performance conditions is determined to be the fair market value of the Company’s underlying common stock on the date of grant. The stock-based compensation expense for RSUs with service-based vesting is recognized over the period during which the vesting restrictions lapse. Stock-based compensation expense for RSUs with performance conditions is recognized beginning in the period the Company determines it is probable that the performance condition will be achieved. Management expectations related to the achievement of performance goals associated with RSUs with performance conditions are assessed regularly to determine whether such grants are expected to vest. The fair value for RSUs with market conditions is estimated using the Monte Carlo valuation model, utilizing expected volatility rates derived from those of the Company and the members of the referenced peer group. Related stock-based compensation is recognized, beginning on the grant date, on a straight-line basis regardless of whether the market condition is met unless the required service is not performed.

Stock Options and Purchase Rights

The fair value of each stock option award and purchase rights under the Company’s Employee Stock Purchase Plan (ESPP) are estimated on the date of grant using the Black-Scholes valuation model and the following assumptions: expected term, expected volatility, risk-free interest rate and expected dividend yield. The dividend yield reflects that the Company has not paid any cash dividends since inception and does not intend to pay any cash dividends in the foreseeable future. The expected term of stock options is based on observed historical exercise patterns. In estimating the life of stock options, the Company has identified two employee groups with distinctly different historical exercise patterns: executive and non-executive. The executive employee group has a history of holding stock options for longer periods than non-executive employees. The expected term of purchase rights for ESPP is based on each tranche of an offering period, which isfour tranches in atwenty-four-month period.

The determination of the fair value of stock-based payment awards using a pricing model is affected by the Company’s stock price and may use assumptions regarding a number of complex and subjective variables.

The Company calculates and provides for income taxes in each of the tax jurisdictions in which it operates. Deferred tax assets and liabilities, measured using enacted tax rates, are recognized for the future tax consequences of temporary differences between the tax and financial statement basis of assets and liabilities. A valuation allowance reduces the deferred tax assets to the amount that is more likely than not to be realized. The Company establishes liabilities or reduces assets for uncertain tax positions when the Company believes certain tax positions are not more likely than not of being sustained if challenged. Each quarter, the Company evaluates these uncertain tax positions and adjusts the related tax assets and liabilities in light of changing facts and circumstances.

The Company uses financial projections to support its net deferred tax assets, which contain significant assumptions and estimates of future operations. If such assumptions were to differ significantly, it may have a material impact on the Company’s ability to realize its deferred tax assets. At the end of each period, the Company will reassess the ability to realize its deferred tax assets. If it is more likely than not that the Company would not realize the deferred tax assets, a valuation allowance may need to be established against all or a portion of the deferred tax assets, which will result in a charge to tax expense.

Foreign Currency

For the Company and its subsidiaries, the functional currency has been determined to be the U.S. Dollar (USD). Assets and liabilities denominated in foreign currency are remeasured at period-end exchange rates for monetary assets and liabilities. Non-monetary assets and liabilities denominated in foreign currencies are remeasured at historical rates. Foreign currency transaction losses resulting from remeasurement recognized in Other Expense, Net in the Consolidated Statements of Income totaled $8.6 million, $27.7 million and $11.4 million in 2024, 2023 and 2022, respectively.

Derivatives and Hedging Activities

The Company uses foreign currency exchange forward contracts (forward contracts) to hedge certain operational exposures resulting from potential changes in foreign currency exchange rates. Such exposures result from portions of the Company’s forecasted revenues and operating expenses being denominated in currencies other than the USD, primarily the Euro. The Company designates certain of these forward contracts as hedging instruments and also enters into forward contracts that are considered to be economic hedges that are not designated as hedging instruments. Whether designated or undesignated, these forward contracts protect against the reduction in value of forecasted foreign currency cash flows resulting from gross product revenues, operating expenses and monetary asset or liability positions designated in currencies other than the USD. To receive hedge accounting treatment, cash flow hedges must be highly effective in offsetting changes to expected future cash flows on hedged transactions. The Company does not hold or issue derivative instruments for trading or speculative purposes.

The Company is exposed to counterparty credit risk on its derivatives. The Company has established and maintains strict counterparty credit guidelines and enters into hedging agreements with financial institutions that are investment grade or better to minimize the Company’s exposure to potential defaults. The Company is not required to pledge collateral under these agreements.

The Company accounts for its derivative instruments as either assets or liabilities on its Consolidated Balance Sheets and measures them at fair value, which is estimated using current exchange and interest rates and takes into consideration the current creditworthiness of the counterparties or the Company, as applicable. For derivatives designated as hedging instruments, the entire change in the fair value of qualifying derivative instruments is recorded in AOCI and amounts deferred in AOCI are reclassified to earnings in the same line item in which the earnings effect of the hedged item is reported. Derivatives not designated as hedging instruments are adjusted to fair value through earnings in SG&A in the Consolidated Statements of Income.

Fair Value of Financial Instruments

The Company applies fair value accounting for all financial assets and liabilities and nonfinancial assets and liabilities that are recognized or disclosed at fair value in the financial statements on a recurring basis. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities that are required to be recorded at fair value, the Company considers the principal or most advantageous market in which the Company would transact and the market-based risk measurements or assumptions that market participants would use to price the asset or liability, such as risks inherent in valuation techniques, transfer restrictions and credit risk. When estimating fair value, depending on the nature and complexity of the asset or liability, the Company may use the following techniques:

•Income approach, which is based on the present value of a future stream of net cash flows

•Market approach, which is based on market prices and other information from market transactions involving identical or comparable assets or liabilities.

The Company’s fair value methodologies depend on the following types of inputs:

•Quoted prices for identical assets or liabilities in active markets (Level 1 inputs)

•Quoted prices for similar assets or liabilities in active markets, or quoted prices for identical or similar assets or liabilities that are not active, or inputs other than quoted process that are directly or indirectly observable, or inputs that are derived principally from, or corroborated by, observable market data by correlation or other means (Level 2 inputs)

•Unobservable inputs that reflect estimates and assumptions (Level 3 inputs)

The Company’s Level 2 instruments are valued using third-party pricing sources. The pricing services utilize industry standard valuation models, including both income and market-based approaches, for which all significant inputs are observable, either directly or indirectly, to estimate fair value. These inputs include reported trades of and broker/dealer quotes on the same or similar securities, issuer credit spreads, benchmark securities, prepayment/default projections based on historical data and other observable inputs. The Company validates the prices provided by its third-party pricing services by understanding the models used, obtaining market values from other pricing sources, analyzing pricing data in certain instances and confirming those securities traded in active markets.

The Company’s Level 3 financial assets and liabilities include acquired intangible assets resulting from business acquisitions. The estimated fair value of acquired finite-lived intangible assets is measured by applying a probability-based income approach utilizing an appropriate discount rate as of the acquisition date.

See Notes 2,7,8, and 10 to these Consolidated Financial Statements for further information on the nature of these financial instruments.

Recent Accounting Pronouncements

New Accounting Pronouncements Issued and Adopted

Segment Reporting

In November, 2023 the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2023-07, Segment Reporting Topic 280, Improvements to Reportable Segment Disclosures, to improve reportable segment disclosure requirements through enhanced disclosures about significant segment expenses. ASU 2023-07 expands public entities’ segment disclosures by requiring disclosure of significant segment expenses that are regularly provided to the Chief Operating Decision Maker (CODM) and included within each reported measure of segment profit or loss, an amount and description of its composition for other segment items and interim disclosures of a reportable segment’s profit or loss and assets. The Company adopted this ASU in December 2024 on a retrospective basis to all periods presented and it did not have a material impact on the Company's consolidated financial statements. See Note 12 to these Consolidated Financial Statements for further information.

New Accounting Pronouncements Issued But Not Yet Adopted

In December 2023, the FASB issued ASU 2023-09, Income Taxes Topic 740, Improvements to Income Tax Disclosures. The guidance requires disclosure of disaggregated information about the Company’s effective tax rate reconciliation as well as information on income taxes paid. The disclosure requirements will be applied on a prospective basis, with the option to apply it retrospectively. The effective date for the update is for fiscal years beginning after December 15, 2024 and interim periods within fiscal years beginning after December 15, 2027. The Company is currently evaluating the effect of the update on the Company's related disclosures.

Income Statement Disaggregation

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income Topic 220, Expense Disaggregation Disclosures. The guidance requires disclosure of additional information about specific expense categories in the notes to financial statements at interim and annual reporting periods. The disclosure requirements will be applied on a prospective basis, with the option to apply it retrospectively. The effective date for the update is for fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027. The Company is currently evaluating the effect of the update on the Company's related disclosures.

Accounting pronouncements not listed above were assessed and determined to be either not applicable or did not have a material impact on the Company's consolidated financial statements.

(2)FINANCIAL INSTRUMENTS

The following tables show the Company’s cash, cash equivalents and available-for-sale securities by significant investment category as of December 31, 2024 and 2023, respectively:

(1)The Company’s short-term marketable securities mature inone year or less.

(2)The Company’s long-term marketable securities mature betweenone andfive years.

As of December 31, 2024, the Company had the ability and intent to hold all investments that were in an unrealized loss position until maturity. The Company considered its intent and ability to hold the securities until recovery of amortized cost basis, the extent to which fair value is less than amortized cost basis, conditions specifically related to the security’s industry and geography, payment structure and history and changes to the ratings (if any) in determining that the decline in fair value compared to carrying value is not related to a credit loss.

The Company has certain investments in non-marketable equity securities, measured using unobservable valuation inputs and remeasured on a nonrecurring basis, which are collectively considered strategic investments. As of December 31, 2024 and December 31, 2023, the fair value of the Company’s strategic investments was $6.6 million and $11.3 million, respectively. These investments were recorded in Other Assets on the Company’s Consolidated Balance Sheets. In the second quarter of 2024, based on new developments, the Company became aware of factors that indicated a $4.5 million decline in the fair value of one of its strategic investments. In 2023, based on new developments at the time, the Company concluded that factors existed indicating it would no longer realize a $12.6 million equity investment in its non-marketable securities. The losses on the Company's equity investments were recorded to Other Expense, Net on the Company’s Consolidated Statements of Income for the respective periods.

See Note 1 to these Consolidated Financial Statements for additional discussion regarding the Company’s fair value measurements.

(3)INTANGIBLE ASSETS

Intangible Assets, Net consisted of the following:

The following table summarizes the carrying value and estimated remaining life of the Company’s finite-lived intangible assets as of December 31, 2024:

(1)Certain technology transfer assets have not yet been placed into service. The average remaining life presented is only for those placed into service.

(2)License payments include finite-lived intangible assets due to the Company's achievement oftwo commercial sale milestones related to ROCTAVIAN.

As of December 31, 2024, the estimated future amortization expense associated with the Company’s finite-lived intangible assets that have been placed into service, was as follows:

(4)PROPERTY, PLANT AND EQUIPMENT

Property, Plant and Equipment, Net, consisted of the following:

Depreciation expense, net of amounts capitalized into inventory, was $46.6 million, $40.3 million and $38.6 million for the years ended December 31, 2024, 2023 and 2022, respectively.

(5)INVENTORY

Inventory consisted of the following:

(6)SUPPLEMENTAL FINANCIAL STATEMENT INFORMATION

Accounts Payable and Accrued Liabilities consisted of the following:

Significant Revenue Rebates and Reserves for Cash Discounts

The roll forward of significant estimated accrued rebates and reserve for cash discounts for the years ended December 31, 2024, 2023 and 2022, were as follows:

(7)FAIR VALUE MEASUREMENTS

The Company measures certain financial assets and liabilities at fair value in accordance with the policy described in Note 1 to these Consolidated Financial Statements.

Other than the Company’s fixed-rate convertible debt disclosed in Note 10 to these Consolidated Financial Statements, there wereno financial assets or liabilities that were remeasured using Level 1 inputs as of December 31, 2024 and 2023. Refer to Notes 2 and 8 to these Consolidated Financial Statements for other financial assets and liabilities measured at fair value. The

Company hadno financial assets or liabilities that are remeasured on a recurring basis using Level 3 inputs as of December 31, 2024 and 2023.

Assets and liabilities that are remeasured on a recurring basis using Level 2 inputs consisted of the following:

(1)The restricted investments as of December 31, 2024 and 2023 secure the Company’s irrevocable standby letters of credit obtained in connection with certain commercial agreements.

There were no transfers between levels during the periods presented.

(8)DERIVATIVE INSTRUMENTS AND HEDGING STRATEGIES

The Company's forward contracts designated as hedging instruments have maturities up to 1.75 years. The Company's forward contracts that are considered to be economic hedges that are not designated as hedging instruments have maturities up tothree months.

The following table summarizes the aggregate notional amounts for the Company’s derivatives outstanding as of the periods presented.

The fair value carrying amounts of the Company’s derivatives, as classified within the fair value hierarchy, were as follows:

(1) Refer to Note 1 to these Consolidated Financial Statements for additional information related to the Company’s fair value measurements.

The following tables summarize the impact of gains and losses from the Company's derivatives on its Consolidated Statements of Income for the periods presented.

As of December 31, 2024, the Company expects to reclassify unrealized gains of $47.8 million from AOCI to earnings as the forecasted revenue and operating expense transactions occur over the next twelve months. For additional discussion of balances in AOCI see Note 11 to these Consolidated Financial Statements.

(9)LEASES

The following table presents the Company’s ROU assets and lease liabilities for the periods presented.

Maturities of lease liabilities as of December 31, 2024 by fiscal year were as follows:

Lease costs associated with payments under the Company’s leases for the periods presented were as follows:

(1) Includes short-term leases and variable lease costs, both of which were not material in the periods presented.

The following table includes the weighted average remaining lease terms and the weighted average discount rate used to calculate the present value of the Company’s lease liabilities:

As of December 31, 2024, noleases were expected to commence that would create significant rights and obligations for the Company.