BIOMARIN PHARMACEUTICAL INC Management’s Discussion and Analysis of Financial Condition and Results of Operations (Form 10-Q)

The following discussion of our financial condition and results of operations
should be read in conjunction with our Condensed Consolidated Financial
Statements and the related Notes thereto included in this Quarterly Report on
Form 10-Q. This discussion contains forward-looking statements that involve
risks and uncertainties. When reviewing the discussion below, you should keep in
mind the substantial risks and uncertainties that could impact our business. In
particular, we encourage you to review the risk factor related to the impact of
the coronavirus pandemic, "The COVID-19 pandemic could continue to materially
adversely affect our business, results of operations and financial condition."
described in "Risk Factors" in Part II, Item 1A in this Quarterly Report on Form
10-Q, amongst the other risk factors. These risks and uncertainties could cause
actual results to differ significantly from those projected in forward-looking
statements contained in this report or implied by past results and trends.
Forward-looking statements are statements that attempt to forecast or anticipate
future developments in our business, financial condition or results of
operations. See the section titled "Forward-Looking Statements" that appears at
the beginning of this Quarterly Report on Form 10-Q. These statements, like all
statements in this report, speak only as of the date of this Quarterly Report on
Form 10-Q (unless another date is indicated), and, except as required by law, we
undertake no obligation to update or revise these statements in light of future
developments. Our Condensed Consolidated Financial Statements have been prepared
in accordance with United States (U.S.) generally accepted accounting principles
(U.S. GAAP) and are presented in U.S. Dollars (USD).


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Contents

   Management's Discussion and Analysis of Financial Condition and Results of
                             Operations (continued)
                  (In millions, except as otherwise disclosed)

Overview

We are a global biotechnology company that develops and commercializes
innovative therapies for people with serious
and life-threatening rare diseases and medical conditions. We select product
candidates for diseases and conditions that represent
a significant unmet medical need, have well-understood biology and provide an
opportunity to be first-to-market or offer a
significant benefit over existing products.

Our pipeline consists of seven commercial therapies and several clinical and preclinical product candidates. A summary of our commercial products, as of
March 31, 2022is provided below:

Commercial Products                          Indication
Products marketed by BioMarin:
Vimizim (elosulfase alpha)                MPS IVA (1)
Naglazyme (galsulfase)                    MPS VI (2)
Kuvan (sapropterin dihydrochloride)       PKU (3)
Palynziq (pegvaliase-pqpz)                PKU (4)
Brineura (cerliponase alfa)               CLN2 (5)
Voxzogo (vosoritide)                      Achondroplasia
Products not marketed by BioMarin:
Aldurazyme (laronidase)                   MPS I (6)


(1)For the treatment of Mucopolysaccharidosis IV Type A

(2)For the treatment of mucopolysaccharidosis VI

(3) For the treatment of Phenylketonuria

(4)For adult patients with PKU

(5) For the treatment of late infantile neuronal ceroid lipofuscinosis type 2

(6)For the treatment of mucopolysaccharidosis I

A summary of our ongoing clinical development programs, as of March 31, 2022is provided below:

                                            Target
Clinical Development Programs             Indication                              Stage
Valoctocogene roxaparvovec          Severe Hemophilia A                      Clinical Phase 3
BMN 307 (1)                         PKU                                     Clinical Phase 1/2
BMN 255                             Primary hyperoxaluria                   Clinical Phase 1/2
BMN 331                             Hereditary Angioedema                   Clinical Phase 1/2


(1)  The FDA placed a clinical hold in September 2021 and requested data for
additional non-clinical studies in February 2022. We will communicate next steps
for the program when available.
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Management report and analysis of the financial situation and the results of

                             Operations (continued)
                  (In millions, except as otherwise disclosed)

Financial Highlights

Key elements of our operating results include the following:

                                                                Three Months Ended
                                                                    March 31,
                                                                               2022         2021
Total revenues                                                              $  519.4      $ 486.0
Cost of sales                                                               $  117.0      $ 120.2
Research and development (R&D) expense                                      $  160.8      $ 148.7
Selling, general and administrative (SG&A) expense                          

$194.6 $174.3

Gain on sale of nonfinancial assets, net                                    $ (108.0)     $     -

Provision for income taxes                                                  $   13.4      $   5.9
Net income                                                                  $  120.8      $  17.4

See “Results of Operations” below for a discussion of our results for the periods presented.

Uncertainty related to the COVID-19 pandemic

The COVID-19 pandemic continues to affect economies and business around the
world. Our global revenue sources, mostly in the form of demand interruptions
such as missed patient infusions and delayed treatment starts for new patients,
and our overall business operations were impacted by COVID-19 during the three
months ended March 31, 2022 and 2021, and we anticipate a continued impact on
our financial results in 2022. The extent and duration of such effects remain
uncertain and difficult to predict, particularly as virus variants continue to
spread. We are actively monitoring and managing our response and assessing
actual and potential impacts to our operating results and financial condition,
as well as developments in our business, which could further impact the
developments, trends and expectations described below. See the risk factor
related to the impact of the coronavirus pandemic, "The COVID-19 pandemic could
continue to materially adversely affect our business, results of operations and
financial condition." described in "Risk Factors" in Part II, Item 1A of this
Quarterly Report, for additional details on the impact of the COVID-19 pandemic.

Business developments

We continued to grow our commercial business and advance our product candidate
pipeline during 2022. We believe that the combination of our internal research
programs, acquisitions and partnerships will allow us to continue to develop and
commercialize innovative therapies for people with serious and life-threatening
rare diseases and medical conditions. Below is a summary of key business
developments:

Continuous focus on research and development

Late-stage regulatory portfolio

?Voxzogo: The global launch of Voxzogo is actively underway, with market access
and reimbursement progressing as anticipated. Since December 2021, we have seen
worldwide increases in the number of children being treated with commercial
Voxzogo and in the number of active markets contributing to Voxzogo sales.

Marketing authorization reviews of Voxzogo are ongoing in Japan and
Australiawith potential approvals in these countries in 2022.

During the quarter, we provided a top-line update on the Phase 2 randomized,
double-blind, placebo-controlled Voxzogo study in infants and young children up
to five years of age with achondroplasia. 52-week results trended in favor of
Voxzogo compared to placebo on height Z-score and annualized growth velocity,
and with no worsening in proportionality in the overall study population. We
intend to initiate discussions with regulatory health authorities to discuss
next steps regarding efforts to expand access to Voxzogo treatment for this
younger age group. We expect to share results from this study at a scientific
meeting mid-year 2022.

•Valoctocogene roxaparvovec: The European Medicines Agency (EMA) continues to
review our Marketing Authorization Application (MAA) for valoctocogene
roxaparvovec and we expect a Committee for Medicinal Products for Human Use
opinion mid-year 2022. We have provided the EMA with two-year follow-up safety
and efficacy data from the GENEr8-1 study.

Based on favorable results from the two-year follow-up safety and efficacy data
from the GENEr8-1 study, we are targeting BLA resubmission for valoctocogene
roxaparvovec in June 2022 followed by an expected six-month
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Management report and analysis of the financial situation and the results of

                             Operations (continued)
                  (In millions, except as otherwise disclosed)

FDA review process. A pre-submission interaction with the FDA is scheduled later in the second quarter of 2022 to discuss our BLA resubmission efforts.

During the first quarter of 2022, we announced that a subject treated with
valoctocogene roxaparvovec in the Phase 2 study over five years ago reported a
salivary gland mass in late 2021. The event was reported as unrelated to
valoctocogene roxaparvovec by the investigator. The subject was successfully
treated and we conducted a genomic analysis from a tissue sample containing the
mass. On April 27, 2022, we announced the findings from the completed analysis
showed a comparable pattern of integration between healthy and tumor containing
tissues, with no evidence emerging that vector integration contributed to the
salivary gland mass. These data will be supplied to the EMA, as part of the
ongoing review of our MAA, as well as included in the BLA resubmission.

Select a development portfolio at an early stage

?BMN 255 for primary hyperoxaluria type 1, a subset of chronic renal disease: We
have completed the single ascending dose arm of the First-in-Human study and are
analyzing the results. We believe the availability of a potent, orally
bioavailable, small molecule like BMN 255 may be able to significantly reduce
disease and treatment burden in certain people with chronic renal disease.

?BMN 331 gene therapy product candidate for Hereditary Angioedema (HAE): During
the first quarter of 2022, we announced that we began dosing patients in the
Phase 1/2 HAERMONY study to evaluate BMN 331, an investigational AAV5-mediated
gene therapy for people living with HAE. The FDA granted Orphan Disease
Designation status to BMN 331 in 2021.


Critical accounting estimates

In preparing our Condensed Consolidated Financial Statements in accordance with
U.S. GAAP and pursuant to the rules and regulations promulgated by the
Securities and Exchange Commission (the SEC), we make assumptions, judgments and
estimates that can have a significant impact on our net income/loss and affect
the reported amounts of certain assets, liabilities, revenues and expenses, and
related disclosures. On an ongoing basis, we evaluate our estimates and discuss
our critical accounting estimates with the Audit Committee of our Board of
Directors. We base our estimates on historical experience and various other
assumptions that we believe to be reasonable under the circumstances. Actual
results could differ materially from these estimates under different assumptions
or conditions. Historically, our assumptions, judgments and estimates relative
to our critical accounting estimates have not differed materially from actual
results.

The full extent to which the ongoing COVID-19 pandemic could continue to
directly or indirectly impact our business, results of operations and financial
condition, including revenues, expenses, reserves and allowances, manufacturing,
clinical trials and research and development costs will depend on future
developments that continue to remain highly uncertain at this time, particularly
as virus variants continue to spread. As events continue to evolve and
additional information becomes available, our estimates may change materially in
future periods.

There have been no material changes in our critical accounting estimates during the three months ended March 31, 2022compared to those disclosed in the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in our Annual Report on Form 10-K for the year ended
December 31, 2021filed with the Security and Exchange Commission on
February 25, 2022.

Recent accounting pronouncements

See Note 1 to our accompanying Condensed Consolidated Financial Statements for a
description of recent accounting pronouncements, if any, and our expectation of
their impact on our results of operations and financial condition.


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Management report and analysis of the financial situation and the results of

                             Operations (continued)
          (In millions of U.S. dollars, except as otherwise disclosed)

Operating results

Net revenue from products

Net product revenue consisted of the following:

                                                                  Three Months Ended
                                                                      March 31,
                                                                               2022             2021            Change
Net product revenues by product:
Vimizim                                                                     $ 183.0          $ 158.4          $  24.6
Naglazyme                                                                     128.0            107.3             20.7
Kuvan                                                                          59.3             70.8            (11.5)
Palynziq                                                                       54.9             54.0              0.9
Brineura                                                                       36.2             27.3              8.9
Voxzogo                                                                        19.7                -             19.7
Total net product revenues marketed by BioMarin                             $ 481.1          $ 417.8          $  63.3
Aldurazyme net product revenues marketed by Sanofi                             24.4             50.0            (25.6)
Total net product revenues                                                  $ 505.5          $ 467.8          $  37.7


Net Product Revenues include revenues generated from our approved products. In
the U.S., our 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) program, and Aldurazyme is marketed worldwide by Sanofi. Outside the
U.S., our commercial products are sold to authorized distributors or directly to
government purchasers or hospitals, which act as the end-users. In certain
countries, governments place large periodic orders for our products. The timing
of these large government orders can be inconsistent and can create significant
quarter to quarter variation in our revenues.

The increase in net product revenue for the three months ended March 31, 2022
compared to 2021 is mainly attributable to the following elements:

•Vimizim and Naglazyme: increase in product sales mainly attributed to new patients starting treatment and timing of orders in the Middle East and Europe;

• Voxzogo: commercial sales due to new patients starting treatment in Europe and the WE following regulatory approvals from the EMA and FDA in the third and fourth quarters of 2021, respectively;

• Brineura: increase in sales mainly due to new patients
Europe; partially offset by

•Aldurazyme: lower product revenues due to the delivery schedule of bulk product batches to Sanofi; and

•Kuvan: lower sales primarily attributed to generic competition as a result of
the loss of exclusivity in the U.S. that occurred in October 2020. We
anticipated and prepared for this loss of exclusivity and the reduction in our
market share, as well as the adverse effect on our revenues and results of
operations. We expect to continue to experience adverse effects on our market
share and revenues in the future due to the loss of exclusivity in the U.S. and
the contracting sapropterin dihydrochloride market.

In certain countries, governments place large periodic orders for our products.
We expect that the timing of these large government orders will continue to be
inconsistent, which may create significant period to period variation in our
revenues. We anticipate the COVID-19 pandemic will have a continued impact on
the remainder of 2022 Net Product Revenues as many of our products are
administered via infusions in a clinic or hospital setting and/or by a
healthcare professional. Although we continue to work with our patient community
and health care providers to find alternative arrangements where necessary, such
as providing infusions at home, the revenue from the doses of our products that
are missed by patients and the lost revenue from delayed treatment starts for
new patients will never be recouped.

See the risk factors "The sale of generic versions of Kuvan by generic
manufacturers has adversely affected and will continue to adversely affect our
revenues and may cause a decline in Kuvan revenues faster than expected" and
"The COVID-19 pandemic could continue to materially adversely affect our
business, results of operations and financial condition" in "Risk Factors"
included in Part II, Item 1A of this Quarterly Report for additional information
on risks we face.
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Management report and analysis of the financial situation and the results of

                             Operations (continued)
          (In millions of U.S. dollars, except as otherwise disclosed)

We face exposure to movements in foreign currency exchange rates, primarily the
Euro. We use foreign currency exchange forward contracts to hedge a percentage
of our foreign currency exposure. The following table shows our Net Product
Revenues denominated in USD and foreign currencies:

                                                       Three Months Ended
                                                           March 31,
                                                                         2022         2021        Change
Sales denominated in USD                                               $ 259.3      $ 255.4      $  3.9
Sales denominated in foreign currencies                                  246.2        212.4        33.8
Total net product revenues                                             $ 505.5      $ 467.8      $ 37.7


                                                                      Three Months Ended
                                                                          March 31,
                                                                                   2022             2021            Change

Unfavorable impact of exchange rates on sales of products denominated in currencies other than the USD

$(9.0) $(3.4) $(5.6)


The unfavorable impact for the three months ended March 31, 2022 as compared to
2021 was primarily driven by weakness relative to the USD associated with the
Euro and Turkish Lira along with currencies from certain Latin American markets.

Royalties and other income

Royalty and Other Revenues include royalties earned on net sales of products
sold by third parties, up-front licensing fees, milestones achieved by licensees
or sublicensees and rental income associated with the tenants in our facilities.

                                           Three Months Ended
                                               March 31,
                                                              2022        2021       Change
Royalty and other revenues                                  $ 13.8      $ 18.3      $ (4.5)


The decrease in Royalty and Other Revenues for the three months ended March 31,
2022 as compared to 2021 was primarily due the absence of the license payment
received from a third party due to their achievement of a regulatory milestone
in the first quarter of 2021; partially offset by an increase in royalties
earned from net sales of third parties.

We expect to continue to collect royalties from third parties in the future.

Cost of sales and gross margin

Cost of Sales includes raw materials, personnel and facility and other costs
associated with manufacturing our commercial products. These costs include
production materials, production costs at our manufacturing facilities,
third-party manufacturing costs, and internal and external final formulation and
packaging costs. Cost of Sales also includes royalties payable to third parties
based on sales of our products and charges for inventory valuation reserves.

The following table summarizes our cost of sales and gross margin:

                               Three Months Ended
                                   March 31,
                                                 2022          2021        Change
Total revenues                                $ 519.4       $ 486.0       $ 33.4
Cost of sales                                 $ 117.0       $ 120.2       $ (3.2)
Gross margin                                     77.5  %       75.3  %       2.2  %

Cost of sales decreased for the three months ended March 31, 2022 compared to 2021, primarily due to lower Aldurazyme sales volume and lower Palynziq manufacturing costs per unit; partially offset by higher sales volumes of Vimizim and

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Management report and analysis of the financial situation and the results of

                             Operations (continued)
          (In millions of U.S. dollars, except as otherwise disclosed)
Naglazyme. Gross margin increased primarily due to portfolio mix with higher
sales volume of products with higher margins, lower inventory reserves and the
improved per unit Palynziq manufacturing costs.

We expect the gross margin to be between approximately 75% and 77% over the next twelve months.

Research and Development

R&D expenses include costs associated with research and development of product candidates and post-marketing research commitments related to our approved products. R&D expenses primarily include preclinical and clinical studies, personnel and raw material costs associated with manufacturing the clinical product, quality control and assurance, other R&D activities, facilities and regulatory costs.

We manage our R&D expense by identifying the R&D activities we anticipate will
be performed during a given period and then prioritizing efforts based on
scientific data, probability of successful development, market potential,
available human and capital resources and other similar considerations. We
continually review our product pipeline and the development status of product
candidates and, as necessary, reallocate resources among the research and
development portfolio that we believe will best support the future growth of our
business.

We continuously evaluate the recoverability of costs associated with pre-launch
or pre-qualification manufacturing activities, and capitalize the costs incurred
related to those activities if it is determined that recoverability is highly
likely and therefore future revenues are expected. When regulatory approval and
the likelihood of future revenues for a product candidate are less certain, the
related manufacturing costs are expensed as R&D expenses. We had $11.3 million
of manufacturing-related costs for valoctocogene roxaparvovec capitalized as
pre-launch inventory as of March 31, 2022. See Note 3 to our accompanying
Consolidated Financial Statements for additional information regarding our
inventory.

R&D expenses break down as follows:

                                              Three Months Ended
                                                  March 31,
                                                                2022         2021        Change
Research and early development                                $  49.0      $  29.8      $ 19.2
Valoctocogene roxaparvovec                                       30.7         25.8         4.9
Voxzogo                                                          29.1         36.3        (7.2)
Other approved products                                          28.3         26.0         2.3
BMN 307                                                          12.7         15.4        (2.7)
BMN 331                                                           7.0          9.6        (2.6)
BMN 255                                                           2.2          1.8         0.4
Other                                                             1.8          4.0        (2.2)
Total R&D expense                                             $ 160.8      $ 148.7      $ 12.1

The increase in R&D expenses for the three months ended March 31, 2022 compared to 2021 mainly includes the following elements:

• higher spending on research and early development programs due to increased preclinical activities and IND-enabling studies for planned IND filings; and

•an increase in clinical trial activities related to the continued development of valoctocogene roxaparvovec; partially offset by

•a decrease in Voxzogo related expenses due to increased capitalization of
manufacturing costs following the EU and U.S. regulatory approvals in the second
half of 2021.

We expect R&D expense to increase in future periods, primarily due to increased
activities for our research and early development programs while we continue to
develop our later stage programs.

Selling, general and administrative expenses

Sales and marketing (S&M) expenses consisted primarily of employee-related expenses for our sales group, brand marketing, patient support groups and pre-marketing expenses related to our product candidates. general and

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Management report and analysis of the financial situation and the results of

                             Operations (continued)
          (In millions of U.S. dollars, except as otherwise disclosed)

administrative expenses (G&A) consisted mainly of business support expenses and other administrative expenses, including personnel expenses.

SG&A expenses consisted of the following:

                                  Three Months Ended
                                      March 31,
                                                    2022         2021        Change
S&M expense                                       $ 104.9      $  94.2      $ 10.7
G&A expense                                          89.7         80.1         9.6
Total SG&A expense                                $ 194.6      $ 174.3      $ 20.3


S&M spend by product was as follows:

                                                                Three Months Ended
                                                                    March 31,
                                                                                  2022         2021       Change
PKU Products (Kuvan and Palynziq)                                               $  29.1      $ 30.8      $ (1.7)
MPS Products (Aldurazyme, Naglazyme and Vimizim)                                   27.1        24.4         2.7
Voxzogo                                                                            22.1        16.5         5.6
Valoctocogene roxaparvovec                                                         15.7        12.2         3.5
Brineura                                                                            7.7         8.1        (0.4)
Other                                                                               3.2         2.2         1.0
Total S&M expense                                                               $ 104.9      $ 94.2      $ 10.7


The increase in S&M expense for the three months ended March 31, 2022 as
compared to 2021 was primarily a result of increased activities in support of
Voxzogo commercial launch following EU and U.S. regulatory approvals in the
latter half of 2021, and an increase in valoctocogene roxaparvovec commercial
launch preparation activities.

The increase in general and administrative expenses is primarily due to increased plant downtime related to maintaining our gene therapy manufacturing facility as well as increased employee related expenses.

We expect SG&A expenses to increase in future periods as we prepare for new product launches and support our global business as it expands.

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Management report and analysis of the financial situation and the results of

                             Operations (continued)
          (In millions of U.S. dollars, except as otherwise disclosed)

Amortization of intangible assets and contingent consideration and gain on sale of non-financial assets, net

Changes during the periods presented for Intangible Asset Amortization and
Contingent Consideration and Gain on Sale of Nonfinancial Assets, Net were as
follows:

                                                                       Three Months Ended
                                                                           March 31,
                                                                                    2022             2021            Change
Changes in the fair value of contingent consideration                            $   2.0          $   2.3          $  (0.3)
Amortization of intangible assets                                                   15.6             15.4              0.2

Total amortization of intangible assets and contingent consideration

$17.6 $17.7 $(0.1)

Gain on sale of nonfinancial assets, net                                    

$108.0 $- $108.0


Fair value of contingent consideration - the increase in the fair value of
contingent consideration for the three months ended March 31, 2022 as compared
to 2021 was attributable to changes in the estimated probability of achieving
sales milestones related to our PKU products.

Amortization of intangible assets – the charge for the three months ended
March 31, 2022 compared to 2021 was relatively stable.

Gain on Sale of Nonfinancial Assets, Net - the increase in the three months
ended March 31, 2022 as compared to 2021 is due to the sale in the first quarter
of 2022 of the Priority Review Voucher (PRV) that we received in connection with
the FDA approval of Voxzogo in 2021. In exchange for the PRV, we received lump
sum payment of $110.0 million, which was recognized as a gain on the sale of
intangible assets, net of broker fees.

interest income

We invest our cash equivalents and investments in U.S. government securities and
other high credit quality debt securities in order to limit default and market
risk.

                               Three Months Ended
                                   March 31,
                                                  2022       2021       Change
Interest income                                  $ 1.8      $ 2.4      $ (0.6)


The decrease in Interest Income for the three months ended March 31, 2022
compared to 2021 was primarily due to lower interest rates. We expect Interest
Income to be higher over the next 12 months due to anticipated higher interest
rates and yields on our cash equivalents and investments.

Interest charges

We incur interest expense primarily on our convertible debt. Interest expense for the periods presented is as follows:

                                  Three Months Ended
                                      March 31,
                                                     2022       2021       Change
Interest expense                                    $ 3.8      $ 3.8      $    -


Interest Expense for the three months ended March 31, 2022 was flat as compared
to 2021. We do not expect Interest Expense to fluctuate significantly over the
next 12 months. See Note 6 to our accompanying Condensed Consolidated Financial
Statements for additional information regarding our debt.
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Management report and analysis of the financial situation and the results of

                             Operations (continued)
          (In millions of U.S. dollars, except as otherwise disclosed)

Other expenses, net

Other net expenses for the periods presented are as follows:

                                  Three Months Ended
                                      March 31,
                                                     2022        2021       Change
Other expense, net                                 $ (1.2)     $ (0.5)     $ (0.7)


The increase in Other Expense, Net for the three months ended March 31, 2022
compared to 2021 was primarily due to the loss on the fair value of the assets
held in our deferred compensation plan.

Provision for income taxes

The following table summarizes our income tax expense:

                                           Three Months Ended
                                               March 31,
                                                              2022       2021       Change
Provision for income taxes                                  $ 13.4      $ 5.9      $  7.5


The increase in income tax expense for the three months ended March 31, 2022 as
compared to 2021 was primarily due to taxes on increased income recognized in
the first quarter of 2022 from the sale of the PRV.

Financial position, liquidity and capital resources

Our cash, cash equivalents and investments in March 31, 2022 and
December 31, 2021 were the following:

                                           March 31, 2022       December 31, 2021       Change
Cash and cash equivalents                 $         605.4      $            587.3      $ 18.1
Short-term investments                              450.8                   426.6        24.2
Long-term investments                               462.8                  

507.8 (45.0) Cash, cash equivalents and investments $1,519.0 $1,521.7 $(2.7)


We believe our cash generated from sales of our commercial products, in addition
to our cash, cash equivalents and investments will be sufficient to satisfy our
liquidity requirements for at least the next 12 months. We believe we will meet
longer-term expected future cash requirements and obligations through a
combination of cash flows from operating activities, available cash and
investments balances and available revolving loan balances. We will need to
raise additional funds from equity or debt securities, loans or collaborative
agreements if we are unable to satisfy our liquidity requirements. For example,
we may require additional financing to fund the repayment of our convertible
debt, future milestone payments and our future operations, including the
commercialization of our products and product candidates currently under
development, preclinical studies and clinical trials, and potential licenses and
acquisitions. The timing and mix of our funding alternatives could change
depending on many factors, including how much we elect to spend on our
development programs, potential licenses and acquisitions of complementary
technologies, products and companies or if we settle our convertible debt in
cash. Our ability to raise additional capital may also be adversely impacted by
potential worsening global economic conditions and the recent disruptions to,
and volatility in, financial markets in the U.S. and worldwide resulting from
the ongoing COVID-19 pandemic.

We are mindful that conditions in the current macroeconomic environment could
affect our ability to achieve our goals. We sell our products in countries that
face economic volatility and weakness. Although we have historically collected
receivables from customers in such countries, sustained weakness or further
deterioration of the local economies and currencies and adverse effects of the
impact of the ongoing COVID-19 pandemic may cause customers in those countries
to be unable to pay for our
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Management report and analysis of the financial situation and the results of

                             Operations (continued)
          (In millions of U.S. dollars, except as otherwise disclosed)

some products. We will continue to monitor these conditions and attempt to adjust our business processes as necessary to mitigate macroeconomic risks to our business.

Our cash flows are summarized as follows:

                                                                   Three Months Ended March 31,
                                                            2022                  2021              Change

Net cash (used in) provided by operating activities  $    (45.4)              $   113.5          $  (158.9)
Net cash provided by (used in) investing activities  $     87.8               $   (70.8)         $   158.6
Net cash used in financing activities                $    (25.3)            

$(24.4) $(0.9)


The decrease in net cash provided by operating activities in the three months
ended March 31, 2022 compared to March 31, 2021 was primarily attributed to the
timing of cash receipts from our customers, the absence of a tax refund from a
Federal carryback claim received in Q1 2021, and higher employee
compensation-related payments.

The increase in net cash provided by investing activities in the three months
ended March 31, 2022 compared to March 31, 2021 was primarily attributable to
the proceeds from the sale of the PRV in the first quarter of 2022 and lower net
purchases of available-for-sale debt securities.

Net cash flows generated by financing activities during the three months ended March 31, 2022 compared to March 31, 2021 was relatively flat.

Financing and credit facilities

Our $1.1 billion (undiscounted) of total convertible debt as of March 31, 2022
will impact our liquidity due to the semi-annual cash interest payments as well
as the repayment of the principal amount, if not converted. As of March 31,
2022, our indebtedness consisted of our 0.599% senior subordinated convertible
notes due in 2024 and our 1.25% senior subordinated convertible notes due in
2027, which, if not converted, will be required to be repaid in cash at maturity
in August 2024 and May 2027, respectively. For additional information related to
our convertible debt see, Note 6 to our accompanying Condensed Consolidated
Financial Statements and Note 10 - Debt to our Annual Report on Form 10-K for
the year ended December 31, 2021.

In October 2018, we entered into an unsecured revolving credit facility of up to
$200.0 million credit subfacility and a swingline loan subfacility. The credit
facility is intended to finance ongoing working capital needs and for other
general corporate purposes. In May 2021, we amended the credit facility
agreement, extending the maturity date from October 19, 2021 to May 28, 2024,
among other changes. The amended credit facility contains financial covenants
including a maximum leverage ratio and a minimum interest coverage ratio. As of
March 31, 2022, there were no amounts outstanding under the credit facility and
we and certain of our subsidiaries that serve as guarantors were in compliance
with all covenants.

Other important sources of liquidity

In the first quarter of 2022, we received a lump sum payment of $110.0 million
for the sale of the PRV received under the WE Voxzogo’s approval. See Note 3 to our accompanying condensed consolidated financial statements for further details.

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Management report and analysis of the financial situation and the results of

                             Operations (continued)
          (In millions of U.S. dollars, except as otherwise disclosed)

Material cash needs

Funding commitments

Our investment in our research and early development of product candidates and
continued development of our existing commercial products has a major impact on
our operating performance. R&D expenses for our commercial products and certain
product candidates for the period since inception as of March 31, 2022 were as
follows:


                               Since Program Inception
Valoctocogene roxaparvovec    $                  855.8
Voxzogo                       $                  729.1
BMN 307                       $                  253.5
BMN 331                       $                   87.1
BMN 255                       $                   28.1
Other approved products       $                2,401.5


We cannot estimate with certainty the cost to complete any of our product
development programs. We may need or elect to increase our spending above our
current long-term plans to be able to achieve our long-term goals. This may
increase our capital requirements, including: costs associated with the
commercialization of our products? additional clinical trials; investments in
the manufacturing of our commercial products? preclinical studies and clinical
trials for our product candidates? potential licenses and other acquisitions of
complementary technologies, products and companies? and general corporate
purposes. Additionally, we cannot precisely estimate the time to complete any of
our product development programs or when we expect to receive net cash inflows
from any of our product development programs. Please see "Risk Factors" included
in Part II, Item 1A of this Quarterly Report on Form 10-Q, for a discussion of
the reasons we are unable to estimate such information.

Purchase obligation

As of March 31, 2022, we had obligations of approximately $117.5 million, all of
which was short term and primarily related to firm purchase commitments entered
into in the normal course of business to procure active pharmaceutical
ingredients, certain inventory-related items and certain third-party R&D
services, production services and facility construction services.

Conditional consideration

As of March 31, 2022, we had $64.0 million of acquisition-related contingent
consideration on our Condensed Consolidated Balance Sheet, all of which is Euro
denominated and was short term. Of this amount, we expect to pay €30 million in
cash in Q2 2022 to a Merck Serono related to our achievement of a Palynziq sales
milestone in Q1 2022. For additional information related to our obligation to
Merck Serono related to a 2016 arrangement, see Note 17 to our Annual Report on
Form 10-K for the year ended December 31, 2021.

Other obligations

Our lease, contingent obligations and unrecognized tax benefits as of March 31,
2022 have not materially changed from those discussed in "Financial Condition,
Liquidity and Capital Resources" in Part II Item 7 of our Annual Report on Form
10-K for the year ended December 31, 2021.
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