Probability of Financial Distress (%) measures the probability that a company will go bankrupt in the upcoming year given its current financial position. A higher ratio indicates a larger probability of bankruptcy for the company, while a lower ratio indicates a healthier fundamental. As of today, Biogen's Probability of Financial Distress (%) is 0.04%.
Like the Altman Z-Score, the PFD measures a company's bankruptcy risk. However, the main drawback of the Z-score is it does not apply to banks and insurance companies. According to Investopedia, the concept of "working capital" does not apply to banks and insurance companies, as financial institutions do not have typical current assets or current liabilities like inventories or accounts payable.
Competitive Comparison
For the Drug Manufacturers - General subindustry, Biogen's Probability of Financial Distress (%), along with its competitors' market caps and Probability of Financial Distress (%) data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Biogen Probability of Financial Distress (%) Distribution
For the Drug Manufacturers industry and Healthcare sector, Biogen's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where Biogen's Probability of Financial Distress (%) falls into.
Biogen Probability of Financial Distress (%) Calculation
Probability of Financial Distress (%) (PFD) was developed by John Campbell, Jens Hilscher and Jan Szilagyi in their Search of Distress Risk. It measures the probability that a company will go bankrupt within the next 12 months given its current financial position.
The Probability of Financial Distress (%) was obtained by a logit probability model based on eight explanatory variables. The logit formula to compute the probability of financial distress (LPFD) is given below:
| LPFD | = | -20.12 * NIMTAAVG | + | 1.60 * TLMTA | - | 7.88 * EXRETAVG | + | 1.55 * SIGMA | - | 0.005 * RSIZE | - | 2.27 * CASHMTA | + | 0.070 * MB | - | 0.09 * PRICE | - | 8.87 |
| = | -7.74 |
The Probability of Financial Distress (%) (PFD) was then obtianed by:
| PFD | = | 1 | / | (1 + e^(-LPFD)) | * | 100% |
| = | 0.04% |
The eight explanatory variables are:
1. NIMTAAVG = Net Income to Market Total Assets
*Note that for companies reported quarterly, geometrically declining weighted quarterly Net Income data in latest four quarters are used.
2. TLMTA = Total liabilities to Market Total Assets
3. CASHMTA = Cash to Market Total Assets
For non-financial companies, CASHMTA is measured as:
4. EXRETAVG = Excess Return compared to the S&P 500
EXRETAVG is the weighted excess return compared to the S&P 500 in past 12 month. Geometrically declining weights are imposed on the monthly excess return to reflect lagged information. The weight is halved each quarter.
5. SIGMA = Standard Deviation of Daily Returns
For sigma, we use the annualized standard deviation of a company's returns over the past 92 days (or 63 trading days).
6. RSIZE = Relative Size
| RSIZE | = | log (Market Cap | / | Total Market Cap of S&P 500 companies) |
7. MB = Market to Adjusted Book Equity Ratio
8. PRICE
PRICE is measured as the log of the stock price, capped at log(15).
Biogen (Biogen) Business Description
Traded in Other Exchanges
Address
225 Binney Street, Cambridge, MA, USA, 02142
Biogen and Idec merged in 2003, combining forces to market Biogen's multiple sclerosis drug Avonex and Idec's cancer drug Rituxan. Today, Rituxan and next-generation antibody Gazyva are marketed via a collaboration with Roche. Biogen also markets novel multiple sclerosis drugs Plegridy, Tysabri, Tecfidera, and Vumerity. In Japan, Biogen's MS portfolio is copromoted by Eisai. Hemophilia therapies Eloctate and Alprolix (partnered with Sobi) were spun off as part of Bioverativ in 2017. Biogen's newer products include Spinraza (SMA, with partner Ionis), Leqembi (Alzheimers, with partner Eisai), Skyclarys (Friedreich's Ataxia, Reata), Zurzuvae (post-partum depression, Sage), and Qalsody (ALS, Ionis). Biogen has several drug candidates in phase 3 trials in neurology-related fields.
Executives
| Priya Singhal |
officer: Head of Development |
C/O ZAFGEN, INC., 175 PORTLAND STREET 4TH FL, BOSTON MA 02114 |
| Jane Grogan |
officer: Head of Research |
BIOGEN INC., 225 BINNEY STREET, CAMBRIDGE MA 02142 |
| Susan Langer |
director |
BIOGEN INC., 225 BINNEY STREET, CAMBRIDGE MA 02142 |
| Ginger Gregory |
officer: EVP, Human Resources |
C/O BIOGEN INC., 225 BINNEY ST., CAMBRIDGE MA 02142 |
| Adam Keeney |
officer: Head of Corporate Development |
BIOGEN INC., 225 BINNEY STREET, CAMBRIDGE MA 02142 |
| Christopher Viehbacher |
director, officer: President and CEO |
C/O AXCELLA HEALTH, INC., 840 MEMORIAL DRIVE, CAMBRIDGE MA 02139 |
| Susan H Alexander |
officer: EVP, General Counsel |
C/O BIOGEN IDEC INC., 14 CAMBRIDGE CENTER, CAMBRIDGE MA 02142 |
| Nicole Murphy |
officer: Head of Pharm Ops and Tech |
BIOGEN INC., 225 BINNEY STREET, CAMBRIDGE MA 02142 |
| Rachid Izzar |
officer: Head of Alzheimer's Disease |
BIOGEN INC., 225 BINNEY STREET, CAMBRIDGE MA 02142 |
| Chirfi Guindo |
officer: EVP Glob. Mkt Acc & Cust Innov |
C/O BIOGEN INC., 225 BINNEY ST., CAMBRIDGE MA 02142 |
| Alfred Sandrock |
officer: Grp SVP, Chief Medical Officer |
14 CAMBRIDGE CENTER, CAMBRIDGE MA 02142 |
| Brian S Posner |
director |
14 CAMBRIDGE CENTER, CAMBRIDGE MA 02142 |
| Jones William D /ca/ |
director |
|
| Maria C Freire |
director |
C/O ALEXANDRIA REAL ESTATE EQUITIES, INC, 26 NORTH EUCLID AVENUE, PASADENA CA 91101 |
| Jesus B Mantas |
director |
BIOGEN INC., 225 BINNEY STREET, CAMBRIDGE MA 02142 |
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