<PAGE>   1


                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549



                                    FORM 10-Q

             QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
                         SECURITIES EXCHANGE ACT OF 1934



                  FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2001



                         COMMISSION FILE NUMBER 0-12042



                                  BIOGEN, INC.
             (Exact name of registrant as specified in its charter)



        MASSACHUSETTS                                         04-3002117
 (State or other jurisdiction of                            (I.R.S. Employer
 incorporation or organization)                             Identification No.)



                    14 CAMBRIDGE CENTER, CAMBRIDGE, MA 02142
                                 (617) 679-2000
          (Address, including zip code, and telephone number, including
            area code, of registrant's principal executive offices)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                              Yes [X]           No [ ]

The number of shares of the registrant's Common Stock, $0.01 par value,
outstanding as of April 30, 2001 was 148,627,468 shares.

<PAGE>   2
                                  BIOGEN, INC.

                                      INDEX

<TABLE>
<CAPTION>

PART I - FINANCIAL INFORMATION                                                                         PAGE NUMBER
<S>                                                                                                    <C>
Condensed Consolidated Statements of Income - Three months ended March 31, 2001 and 2000                    3

Condensed Consolidated Balance Sheets - March 31, 2001 and December 31, 2000                                4

Condensed Consolidated Statements of Cash Flows -
    Three months ended March 31, 2001 and 2000                                                              5

Notes to Condensed Consolidated Financial Statements                                                        6

Management's Discussion and Analysis of Financial Condition and Results of Operations                       10

PART II - OTHER INFORMATION                                                                                 15
</TABLE>


         Note concerning trademarks: AVONEX(R) is a registered trademark of
Biogen, Inc.


                                       2
<PAGE>   3
                          BIOGEN, INC. AND SUBSIDIARIES
                   CONDENSED CONSOLIDATED STATEMENTS OF INCOME
                                   (unaudited)
                    (in thousands, except per share amounts)

<TABLE>
<CAPTION>

                                                       Three Months Ended
                                                           March 31,
                                                     2001            2000
                                                   --------         --------
<S>                                                <C>              <C>
REVENUES:
       Product                                     $219,997         $174,596
       Royalties                                     17,050           42,252
                                                   --------         --------
Total revenues                                      237,047          216,848
                                                   --------         --------
COSTS AND EXPENSES:

       Cost of revenues                              29,146           28,623
       Research and development                      72,770           63,006
       Selling, general and administrative           48,560           41,183
                                                   --------         --------
Total costs and expenses                            150,476          132,812
                                                   --------         --------
Income from operations                               86,571           84,036
Other income, net                                    16,463           99,024
                                                   --------         --------
INCOME BEFORE INCOME TAXES                          103,034          183,060
Income taxes                                         30,911           61,694
                                                   --------         --------
NET INCOME                                         $ 72,123         $121,366
                                                   ========         ========

BASIC EARNINGS PER SHARE                           $   0.49         $   0.81
                                                   ========         ========
DILUTED EARNINGS PER SHARE                         $   0.47         $   0.77
                                                   ========         ========
SHARES USED IN COMPUTING:
Basic earnings per share                            148,188          150,360
                                                   ========         ========
Diluted earnings per share                          153,491          157,712
                                                   ========         ========
</TABLE>

            See Notes to Condensed Consolidated Financial Statements.


                                       3
<PAGE>   4
                          BIOGEN, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (in thousands)

<TABLE>
<CAPTION>
                                                       March 31,             December 31,
                                                          2001                 2000
                                                      -----------          -----------
                                                      (unaudited)
<S>                                                   <C>                  <C>
ASSETS
Current assets
       Cash and cash equivalents                      $    28,455          $    48,737
       Marketable securities                              719,572              633,675
       Accounts receivable, net                           146,804              143,178
       Deferred tax assets                                 48,476               40,047
       Other current assets                                61,565               62,634
                                                      -----------          -----------
       Total current assets                             1,004,872              928,271
                                                      -----------          -----------
Property, plant and equipment
       Cost                                               573,625              537,072
       Less accumulated depreciation                      145,000              136,643
                                                      -----------          -----------
       Property, plant and equipment, net                 428,625              400,429
                                                      -----------          -----------
Patents, net                                               13,938               13,510
Marketable securities                                      39,393               71,982
Other assets                                               18,755               17,664
                                                      -----------          -----------
                                                      $ 1,505,583          $ 1,431,856
                                                      ===========          ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
       Accounts payable                               $    41,707          $    37,869
       Current portion of long-term debt                    4,888                4,888
       Accrued expenses and other                         179,592              178,264
                                                      -----------          -----------
       Total current liabilities                          226,187              221,021
                                                      -----------          -----------
Long-term debt, less current portion                       46,380               47,185
Other long-term liabilities                                52,659               57,248
Commitments and contingencies                                --                   --

Shareholders' equity
       Common stock                                         1,517                1,517
       Additional paid-in capital                         784,571              772,172
       Retained earnings                                  571,189              543,913
       Accumulated other comprehensive income               6,477               22,376
       Treasury stock, at cost                           (183,397)            (233,576)
                                                      -----------          -----------
Total shareholders' equity                              1,180,357            1,106,402
                                                      -----------          -----------
                                                      $ 1,505,583          $ 1,431,856
                                                      ===========          ===========
</TABLE>

            See Notes to Condensed Consolidated Financial Statements.


                                       4
<PAGE>   5
                          BIOGEN, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                   (unaudited)
                                 (in thousands)


<TABLE>
<CAPTION>
                                                                                Three Months Ended
                                                                                    March 31,
                                                                              2001              2000
                                                                           ---------          ---------
<S>                                                                        <C>                <C>
CASH FLOWS FROM OPERATING ACTIVITIES
      Net income                                                           $  72,123          $ 121,366
      Adjustments to reconcile net income to
         net cash provided from operating activities:
         Depreciation and amortization                                         8,777              8,233
         Deferred income taxes                                                   (70)               273
         Tax benefit of stock options                                         12,224             61,106
         Other                                                                   (66)              (780)
         Gain on sale of non-current marketable securities                    (2,540)           (92,447)
         Changes in:
             Accounts receivable                                              (3,626)             1,869
             Other current and other assets                                    2,851              4,705
             Accounts payable, accrued expense and
                other current and long-term liabilities                         (319)           (25,491)
                                                                           ---------          ---------
         Net cash from operating activities                                   89,354             78,834
                                                                           ---------          ---------

CASH FLOWS FROM INVESTING ACTIVITIES
      Purchases of marketable securities                                    (483,159)          (196,483)
      Proceeds from sales and maturities of marketable securities            403,624            229,990
      Proceeds from sales of non-current marketable securities                 2,774             91,958
      Acquisitions of property and equipment                                 (36,553)           (34,653)
      Additions to patents                                                      (848)            (1,249)
                                                                           ---------          ---------
         Net cash from investing activities                                 (114,162)            89,563
                                                                           ---------          ---------

CASH FLOWS FROM FINANCING ACTIVITIES
      Payments of long-term debt                                                (805)              (805)
      Purchases of treasury stock                                             (5,047)          (149,470)
      Proceeds from put warrants                                                --                 --
      Issuance of common and treasury stock, related to stock
         option exercises                                                     10,378             26,997
                                                                           ---------          ---------
         Net cash from investing activities                                    4,526           (123,278)
                                                                           ---------          ---------

NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS                         (20,282)            45,119

CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD                                48,737             56,920
                                                                           ---------          ---------
CASH AND CASH EQUIVALENTS, END OF PERIOD                                   $  28,455          $ 102,039
                                                                           =========          =========
</TABLE>

            See Notes to Condensed Consolidated Financial Statements.


                                       5
<PAGE>   6
                          BIOGEN, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (unaudited)

1.  BASIS OF PRESENTATION

In the opinion of management, the accompanying unaudited condensed consolidated
financial statements include all adjustments, consisting of only normal
recurring accruals, necessary to present fairly the financial position, results
of operations and cash flows of Biogen, Inc. and its subsidiaries (the
"Company"). The Company's accounting policies are described in the Notes to the
Consolidated Financial Statements in the Company's 2000 Annual Report on Form
10-K. Interim results are not necessarily indicative of the operating results
for the full year.

The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements, and
the reported amounts of revenues and expenses during the reporting period.
Actual results could differ from those estimates. Certain amounts for the three
months ended March 31, 2000 have been reclassified to conform to the current
period presentation.

INVENTORIES

Inventories are stated at the lower of cost or market with cost determined under
the first-in/first-out ("FIFO") method and are included in other current assets.
Included in inventory are raw materials used in the production of pre-clinical
and clinical products which are expensed as research and development costs when
consumed. The components of inventories are as follows:

<TABLE>
<CAPTION>
                        March 31,      December 31,
(in thousands)           2001             2000
                       ---------------------------
<S>                    <C>             <C>
Raw materials           $ 8,104         $ 7,775
Work in process          15,751          17,582
Finished goods           12,701          14,172
                        -------         -------
                        $36,556         $39,529
                        =======         =======
</TABLE>

2.  FINANCIAL INSTRUMENTS

On June 15, 1998, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 133, "Accounting for Derivative Instruments
and Hedging Activities", ("SFAS 133"). The Company elected to adopt SFAS 133 in
the fourth quarter of 1998. All derivatives are recognized on the balance sheet
at their fair value. Changes in the fair value of derivatives are recorded each
period in current earnings or other comprehensive income, depending on whether a
derivative is designated as part of a hedge transaction and, if it is, the type
of hedge transaction. The Company assesses, both at its inception and on an
on-going basis, whether the derivatives that are used in hedging transactions
are highly effective in offsetting the changes in cash flows of hedged items.
The Company assesses hedge ineffectiveness on a quarterly basis and records the
gain or loss related to the ineffective portion to current earnings to the
extent significant. If the Company determines that a hedged forecasted
transaction is no longer probable of occurring, the Company discontinues hedge
accounting for the affected portion of the transaction, and any unrealized gain
or loss on the contract is recognized in current earnings.

As of March 31, 2001, the Company had $15.8 million outstanding under a floating
rate loan secured by one of the Company's laboratory and office buildings in
Cambridge, Massachusetts and $35.4 million outstanding under a floating rate
loan agreement for financing the construction of its biological manufacturing
facility in North Carolina. The Company uses interest rate swap agreements to
mitigate the risk associated with its floating rate debt. The fair value of the
interest rate swap agreements at March 31, 2001, representing the cash
requirements of the Company to settle the agreements, was approximately $2.6
million. The fair value

                                       6
<PAGE>   7
of the interest rate swap agreements at March 31, 2000, representing the cash
the Company would receive to settle the agreements, was approximately $691,000.
The Company has designated the interest rate swaps as cash flow hedges. There
were no amounts of hedge ineffectiveness related to the Company's interest rate
swaps during the three months ended March 31, 2001 or in the comparable period
of 2000, and no gains or losses were excluded from the assessment of hedge
effectiveness. The Company records the differential to be paid or received on
the interest rate swaps as incremental interest expense.

The Company has foreign currency forward contracts to hedge specific forecasted
transactions denominated in foreign currencies. All foreign currency forward
contracts have durations of ninety days to 9 months. These contracts have been
designated as cash flow hedges and accordingly, to the extent effective, any
unrealized gains or losses on these foreign currency forward contracts are
reported in other comprehensive income. Realized gains and losses for the
effective portion are recognized with the underlying hedge transaction. The
notional settlement amount of the foreign currency forward contracts outstanding
at March 31, 2001 was approximately $82.4 million. These contracts had a fair
value of approximately $5 million, representing an unrealized gain, and were
included in other current assets at March 31, 2001.

For the three months ended March 31, 2001 and 2000, there were no significant
amounts recognized in earnings due to hedge ineffectiveness or as a result of
the discontinuance of cash flow hedge accounting because it was no longer
probable that the hedge forecasted transaction would occur. The Company
recognized $3 million of gains in product revenue and $830,000 of gains in
royalty revenue for the settlement of certain effective cash flow hedge
instruments during the three months ended March 31, 2001. For the three months
ended March 31, 2000, the Company recognized a $2.4 million of gains in product
revenue and $600,000 of gains in royalty revenue for the settlement of certain
cash flow hedge instruments during the period. These settlements were recorded
in the same period as the related forecasted transactions affecting earnings.

3.  COMPREHENSIVE INCOME

Comprehensive income is comprised of net income and other comprehensive income.
Other comprehensive income includes certain changes in equity that are excluded
from net income, such as translation adjustments and unrealized holding gains
and losses on available-for-sale marketable securities, net of tax and certain
derivative instruments, net of tax. Comprehensive income for the three months
ended March 31, 2001 and 2000 was $56.2 million and $100.3 million,
respectively.

4.  EARNINGS PER SHARE

The Company calculates earnings per share in accordance with Statement of
Financial Accounting Standards No. 128, "Earnings per Share". Basic earnings per
share is computed by dividing the net income available to common shareholders by
the weighted average number of shares of common stock outstanding. For purposes
of calculating diluted earnings per share the denominator includes both the
weighted average number of shares of common stock outstanding and the number of
dilutive common stock equivalents such as stock options and warrants. Options to
purchase approximately 1.9 million shares were outstanding at March 31, 2001 but
not included in the computation of diluted earnings per share because the
options' exercise prices were greater than the average market price during the
period. Shares used in calculating basic and diluted earnings per share for the
three-month periods ending March 31, are as follows:

<TABLE>
<CAPTION>
(in thousands)                              2001             2000
                                           -------         -------
<S>                                        <C>             <C>
Weighted average number of shares
      of common stock outstanding          148,188         150,360
Dilutive stock options                       5,303           7,352
                                           -------         -------
Shares used in calculating diluted
     Earnings per share                    153,491         157,712
                                           =======         =======
</TABLE>


                                       7
<PAGE>   8
5.  SHARE REPURCHASE PROGRAM

On December 18, 2000, the Company announced that its Board of Directors had
authorized the repurchase of up to 4 million shares of the Company's common
stock. The repurchased stock will provide the Company with treasury shares for
general corporate purposes, such as stock to be issued under employee stock
option and stock purchase plans. Stock purchases are expected to occur from time
to time throughout 2001. To enhance the current stock repurchase program, the
Company entered into an agreement with an independent third party under which
the Company committed to purchase up to 500,000 shares of the Company's stock
subject to the terms of the agreement. The Company purchased 76,000 shares
through March 31, 2001 at a cost of $5 million. The agreement permits a net
share settlement at the Company's option. The stock repurchase program may be
discontinued at any time. In November of 2000, the Company completed a previous
stock repurchase program. During 2000, the Company repurchased approximately 4.6
million shares of its common stock under this program at a cost of $300.2
million.


6.  OTHER INCOME, NET

Other income, net consists of the following (in thousands):

<TABLE>
<CAPTION>

                                         March 31,
                                ---------------------------
                                   2001              2000
                                --------          --------
<S>                             <C>               <C>
Interest income                 $ 11,785          $ 10,737
Interest expense                  (1,039)           (1,108)
Other income                       5,717            89,395
                                --------          --------
Total other income, net         $ 16,463          $ 99,024
                                ========          ========
</TABLE>

Other income for the three-months ended March 31, 2001 includes non-recurring
gains on the sale of certain non-current marketable securities totaling
approximately $2.5 million. Other income for the three-months ended March 31,
2000 includes non-recurring gains on the sale of certain non-current marketable
securities totaling approximately $92.4 million.

7.  INCOME TAX EXPENSE

Income tax expense as a percentage of pre-tax income for the quarters ended
March 31, 2001 and 2000 was 30% and 33.7%, respectively. During the quarter
ended March 31, 2000, the Company recognized non-recurring gains on the sale of
certain non-current marketable securities. Excluding the tax effect on this
non-recurring gain, the Company's effective tax rate for the quarter was 30%.
The effective tax rate varied from the U.S. statutory rates for the first
quarter of 2001 and 2000 primarily due to higher sales in European jurisdictions
with lower tax rates and to the utilization of research and development credits.
The Company's effective tax rate outside the U.S. is lower than the U.S. tax
rate, and the Company expects that the U.S. tax rate will decline as a
percentage of its total tax rate as international sales increase.

8.  LITIGATION

On July 3, 1996, Berlex Laboratories, Inc. ("Berlex") filed suit against Biogen
in the United States District Court for the District of New Jersey alleging
infringement by Biogen of Berlex's "McCormick" patent (U.S. Patent No.
5,376,567) in the United States in the production of Biogen's AVONEX(R)
(Interferon beta-1a) product. In November 1996, Berlex's New Jersey action was
transferred to the United States District Court in Massachusetts and
consolidated for pre-trial purposes with a related declaratory judgment action
previously filed by Biogen. On August 18, 1998, Berlex filed a second suit
against Biogen alleging infringement by Biogen of a patent which was issued to
Berlex in August 1998 and which is related to the McCormick patent (U.S. Patent
No. 5,795,779). On September 23, 1998, the cases were consolidated for pre-trial
and trial purposes. Berlex sought a judgment granting it damages, a trebling of
any damages awarded and a permanent injunction restraining Biogen from the
alleged infringement. A hearing on the parties' summary judgment motions in the
case was completed in March 2000. In September 2000, the District Court rendered
final judgment in favor of Biogen and against Berlex determining that Biogen's
production of AVONEX(R) did not infringe any of the claims of the Berlex
patents. Berlex has appealed this decision with the Court of Appeals for the
Federal Circuit and the parties are in the process of briefing the appeal for
oral argument. An unfavorable ruling on appeal would result in the case being
remanded to the District Court for trial. If Berlex were to be successful in its
appeal and the case were remanded, an unfavorable ruling in the remanded case
could have a material adverse effect on the Company's results of

                                       8
<PAGE>   9
operations and financial position. The Company believes that the decision of the
District Court that Biogen does not infringe the Berlex patents is sound, but
the ultimate outcome of the appeal is not currently determinable. As a result,
an estimate of any potential loss or range of loss cannot be made at this time.

In 1995, the Company filed an opposition with the Opposition Division of the
European Patent Office to oppose a European patent (the "Rentschler I Patent")
issued to Dr. Rentschler Biotechnologie GmbH ("Rentschler") relating to
compositions of matter of beta interferon. In 1997, the European Patent Office
issued a decision to revoke the Rentschler I Patent. Rentschler appealed that
decision and an oral hearing on the appeal took place in December 2000. At the
oral hearing in order to gain reinstatement of the patent, Rentschler narrowed
the patent claims so as to claim only a specific cell line. Biogen does not use
the specific cell line now claimed. On October 13, 1998, the Company filed
another opposition with the Opposition Division of the European Patent Office to
oppose a second European patent issued to Rentschler (the "Rentschler II
Patent") with certain claims regarding compositions of matter of beta interferon
with specific regard to the structure of the glycosylated molecule. A hearing on
the Company's opposition will likely be held in 2001. While Biogen believes that
the Rentschler II Patent will be revoked and that the revocation of the
Rentschler I Patent will be upheld on appeal, if either the Rentschler I Patent
or the Rentschler II Patent were to be upheld and if Rentschler were to obtain,
through legal proceedings, a determination that the Company's sale of AVONEX(R)
in Europe infringes a valid Rentschler patent, such result could have a material
adverse effect on the Company's results of operation and financial position.

9.  SEGMENT INFORMATION

The chief operating decision makers review the profit and loss of the Company on
an aggregate basis and manage the operations of the Company as a single
operating segment. Accordingly, the Company operates in one segment, which is
the business of developing, manufacturing and marketing drugs for human health
care. The Company currently derives product revenues from sales of its AVONEX(R)
(Interferon beta-1a) product for the treatment of relapsing forms of multiple
sclerosis. The Company also derives revenue from royalties on worldwide sales by
the Company's licensees of a number of products covered under patents controlled
by the Company, including alpha interferon and hepatitis B vaccines and
diagnostic products.


                                       9
<PAGE>   10
                          BIOGEN, INC. AND SUBSIDIARIES
         MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
                             RESULTS OF OPERATIONS


OVERVIEW

Biogen, Inc. (the "Company" or "Biogen") is a biopharmaceutical company
principally engaged in the business of developing, manufacturing and marketing
drugs for human health care. The Company currently derives revenues from sales
of its AVONEX(R) (Interferon beta-1a) product for the treatment of relapsing
forms of multiple sclerosis ("MS"). The Company also derives revenue from
royalties on worldwide sales by the Company's licensees of a number of products
covered under patents controlled by the Company, including alpha interferon and
hepatitis B vaccines and diagnostic products.

RESULTS OF OPERATIONS

For the quarter ended March 31, 2001, the Company reported net income of $72.1
million or $0.47 per diluted share as compared to $121.4 million or $0.77 per
diluted share for the comparable period of 2000.

Total revenues for the quarter ended March 31, 2001 were $237 million, as
compared to $216.8 million in the same period of 2000, an increase of $20.2
million or approximately 9%.

Product revenues in the current quarter were $220 million as compared to $174.6
million for the same period of 2000, an increase of $45.4 million or
approximately 26%. Product revenues from AVONEX(R) represent approximately 93%
of the Company's total revenues in the current quarter as compared to 81% for
the same period of 2000. The growth in the first quarter of 2001 over the
comparable period in 2000 is primarily attributable to an increase in the sales
volume of AVONEX(R) in the United States and in the fifteen member countries of
the European Union ("EU"). AVONEX(R) sales outside of the United States were
approximately $58.2 million in the first quarter of 2001 as compared to $48.4
million in 2000.

Revenues from royalties in the period ended March 31, 2001 were $17.1 million, a
decrease of $25.2 million or approximately 59.7% as compared to $42.3 million of
royalty revenue for the same period in 2000. Revenues from royalties represented
approximately 7% of total revenues for the first three months of 2001 as
compared to 19% for the same period of 2000. The decrease in royalty revenues in
the current quarter over the comparable period in 2000 is primarily the result
of reductions attributable to a dispute with Schering-Plough Corporation
("Schering-Plough") over eighteen months of royalties payable by Schering-Plough
on U.S. sales of its alpha interferon products, including INTRON(R) A, patent
expirations and lower licensee sales.

The Company expects product sales as a percentage of total revenues to continue
to increase in the near and long term as the Company continues to market
AVONEX(R) worldwide. The Company, however, expects to face increasing
competition in the MS marketplace from existing and new MS treatments that may
impact sales of AVONEX(R). The Company expects to continue to experience
declining royalty revenues as a result of patent expirations. In addition, sales
levels of products sold by the Company's licensees may also fluctuate from
quarter to quarter due to the timing and extent of major events such as new
indication approvals or government sponsored programs.

COSTS AND EXPENSES

Total costs and expenses for the current quarter of 2001 were $150.5 million as
compared to $132.8 million in the same period of 2000, an increase of
approximately 13%.

Cost of revenues in the first three months of 2001 totaled $29.1 million, an
increase of $500,000 or 2% as compared to the comparable period in 2000. The
increase in cost of revenues was attributable to the higher sales volume of
AVONEX(R). Included in cost of revenues for the period ended March 31, 2001 and
2000 is $28.3 million and $26 million, respectively, of costs related to product
revenues and $838,000 and $2.6

                                       10
<PAGE>   11
million, respectively, of costs related to royalty revenue. Gross margins on
product revenues increased to approximately 87% for the period ended March 31,
2001 compared to 85% in the same period in 2000. Gross margins on royalty
revenue increased to approximately 95% for the period ended March 31, 2001
compared to 94% in the same period in 2000. The Company expects that gross
margins on royalty revenue will fluctuate in the future based on changes in
sales volumes for specific products.

Research and development expenses in the current quarter were $72.8 million, an
increase of $9.8 million or 16% as compared to $63 million in the same period of
2000. The increase was primarily due to an increase in clinical trial costs and
the costs associated with an increase in the Company's other development efforts
related to its ongoing research and development programs. The Company expects
that, in the near and long-term, research and development expenses will increase
as the Company continues to expand its development efforts with respect to new
products, conducts clinical trials of these products and continues work on new
formulations and delivery methods for AVONEX(R).

Selling, general and administrative expenses in the first quarter of 2001 were
$48.6 million, an increase of $7.4 million or 18% as compared to the same period
of 2000. This increase was primarily due to an increase in selling and marketing
expenses related to the sale of AVONEX(R). The Company expects that selling,
general and administrative expenses will continue to increase in the near term
as the Company continues to expand its sales and marketing efforts and
organizations necessary to sell AVONEX(R) worldwide.

OTHER INCOME, NET

Other income, net consists primarily of interest income, partially offset by
interest expenses and other non-operating income and expenses. Other income, net
in the current quarter of 2001 was $16.5 million as compared to $99 million in
2000, a decrease of $82.5 million. Interest income for the first quarter of 2001
was $11.8 million compared to $10.7 million in the same period of 2000, an
increase of $1.1 million or 10% due primarily to higher average yields and an
increase in funds invested. Other income decreased by $83.7 million in the first
three months of 2001 from the same period in 2000, due primarily to the sale of
certain non-current marketable securities generating non-recurring gains of
approximately $92.4 million in the first quarter of 2000. The Company expects
interest income to vary based on changes in the amount of funds invested and
fluctuations in interest rates.

INCOME TAXES

Income tax expense as a percentage of pre-tax income for the quarters ended
March 31, 2001 and 2000 was 30% and 33.7%, respectively. During the quarter
ended March 31, 2000, the Company recognized non-recurring gains on the sale of
certain non-current marketable securities totaling approximately $92.4 million.
Excluding the tax effect on these non-recurring gains, the Company's effective
tax rate for the quarter was 30%. The effective tax rate varied from the U.S.
statutory rates for the first quarter of 2001 and 2000 primarily due to higher
sales in European jurisdictions with lower tax rates and to the utilization of
research and development credits. The Company's effective tax rate outside the
U.S. is lower than the U.S. tax rate, and the Company expects that the U.S. tax
rate will decline as a percentage of its total tax rate as international sales
increase.

FINANCIAL CONDITION

At March 31, 2001, cash, cash equivalents and short-term marketable securities
were $748 million compared with $682.4 million at December 31, 2000, an increase
of $65.6 million. Working capital

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increased $71.4 million to $778.7 million. Net cash from operating activities
for the period ended March 31, 2001 was $89.4 million compared with $78.8
million for the same period in 2000. Cash outflows from investing activities
during the first quarter of 2001 included investments in property and equipment
and patents of $37.4 million. Net cash outflows from investing activities
related to marketable securities was $76.8 million. Significant cash outflows
from financing activities included $5 million for purchases of the Company's
common stock under its stock repurchase program and $805,000 for repayments on
loan agreements with banks. Cash inflows included $10.4 million from common
stock option exercises and employee stock purchase plan activity.

On December 18, 2000, the Company announced that its Board of Directors had
authorized the repurchase of up to 4 million shares of the Company's common
stock. The repurchased stock will provide the Company with treasury shares for
general corporate purposes, such as stock to be issued under employee stock
option and stock purchase plans. Stock purchases are expected to occur from time
to time throughout 2001. To enhance the current stock repurchase program, the
Company entered into an agreement with an independent third party under which
the Company committed to purchase up to 500,000 shares of the Company's stock
subject to the terms of the agreement. The Company purchased 76,000 shares
through March 31, 2001 at a cost of $5 million. The agreement permits a net
share settlement at the Company's option. The stock repurchase program may be
discontinued at any time. In November of 2000, the Company completed a previous
stock repurchase program. During 2000, the Company repurchased approximately 4.6
million shares of its common stock under this program at a cost of $300.2
million.

On October 4, 1999, the Company began construction of its new research and
development center in Cambridge, Massachusetts. The new 224,000 square foot
building was completed in the spring of 2001 at a total cost of approximately
$95 million, of which $87.6 million had been committed at March 31, 2001.
Additionally, the Company is building a large scale manufacturing plant in
Research Triangle Park, North Carolina. The Company expects that construction
will be completed at the end of 2001 at a total cost of approximately $175
million, of which $158.7 million had been committed at March 31, 2001.

Several legal proceedings were pending during the current quarter, which involve
the Company. See Note 8 of the Notes to the Condensed Consolidated Financial
Statements. See also Item 1 - Business, "Patents and Other Proprietary Rights"
of the Company's Annual Report on Form 10-K for the fiscal year ended December
31, 2000 for discussions of these legal proceedings.

The Company believes that existing funds and cash generated from operations are
adequate to satisfy its working capital and capital expenditure requirements in
the foreseeable future. However, the Company may raise additional capital to
take advantage of favorable conditions in the market or in connection with the
Company's development activities.

OUTLOOK

SAFE HARBOR STATEMENT UNDER PRIVATE SECURITIES LITIGATION REFORM ACT OF 1996

In addition to historical information, this quarterly report contains
forward-looking statements that involve risks and uncertainties that could cause
actual results to differ materially from those reflected in such forward-looking
statements. Reference is made in particular to forward-looking statements
regarding the anticipated level of future product sales, royalty revenues,
expenses and profits and predictions as to the anticipated outcome of pending
litigation and patent-related proceedings. These and all other forward-looking
statements are made based on the Company's current belief as to the outcome and
timing of such future events. Factors which could cause actual results to differ
from the Company's expectations and which could negatively impact the Company's
financial condition and results of operations are discussed below and elsewhere
in this Management's Discussion and Analysis of Financial Condition and Results
of Operations.

DEPENDENCE ON AVONEX(R) SALES

The Company's ability to sustain increases in revenues and profitability in the
near term will be primarily dependent on the level of revenues and profitability
from AVONEX(R) sales. The Company's ability to sustain profitability from
sales of AVONEX(R) will depend on a number of factors, including: continued
market acceptance of AVONEX(R) worldwide; the Company's ability to maintain a
high level of patient satisfaction with AVONEX(R); the nature of regulatory
and pricing decisions related to AVONEX(R) worldwide and the extent to which
AVONEX(R) receives and maintains reimbursement coverage;

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successful resolution of the lawsuit with Berlex related to the "McCormick"
patents, which if ultimately decided in Berlex's favor could have a material
adverse effect on the Company's financial position and results of operations;
success in revoking the Rentschler patent since if the patent were to be upheld
and if Rentschler were to obtain, through legal proceedings, a determination
that the Company's sale of AVONEX(R) in Europe infringes a valid Rentschler
patent, such result could have a material adverse effect on the Company's
results of operation and financial condition; the success of ongoing development
work related to AVONEX(R) in expanded MS indications; the continued
accessibility of third parties to vial, label, and distribute AVONEX(R) on
acceptable terms; and the Company's ability to sustain market share of AVONEX(R)
in light of the impact of competitive products for the treatment of MS. In the
United States, one of the Company's competitors, Serono Laboratories, Inc., is
conducting a head-to-head study of its Rebif(R), a (recombinant interferon
beta-1a) product and AVONEX(R) in an attempt to get Rebif(R) approved before
expiration of AVONEX's orphan drug status in 2003. If Serono Laboratories, Inc.
is successful, competition in the United States MS marketplace will increase.

ROYALTY REVENUE

The Company receives royalty revenues which contribute a significant amount to
its overall profitability. The Company expects to continue to experience a
decline in royalty revenues as a result of patent expirations and other
patent-related events in the range of up to approximately $10 million per
quarter for 2001 (not including amounts that are subject to a dispute with
Schering-Plough as discussed below). See "Outlook - Patents and Other
Proprietary Rights" in the Company's Annual Report on Form 10-K for the period
ended December 31, 2000. The Company expects the most significant decline to be
in the amount of royalties received from Schering-Plough on sales of INTRON(R) A
as the result of patent expirations in the EU and Japan. The extent of the
decline in royalties related to United States sales of INTRON(R) A will depend
on the outcome of a dispute with Schering-Plough related to its royalty
obligations. Schering-Plough has taken the position that a Court of Appeal's
decision affirming a District Court's ruling which narrowed the scope of the
claims of Biogen's United States alpha interferon patent has caused the patent
to no longer cover Schering-Plough's alpha interferon products, and, that, as a
result, Schering-Plough no longer has an obligation to pay royalties under that
patent. Until expiration of Biogen's EU (Irish) patent in January 2001,
Schering-Plough continued to pay royalties on sales of product in the United
States based on manufacture of the product in Ireland. In any event, commencing
in July 2002, Schering-Plough is obligated to pay royalties on sales of its
alpha interferon products in the U.S., including INTRON(R)A, during the term of
a certain Roche/Genentech U.S. alpha interferon patent right under an agreement
between Biogen and Schering-Plough in connection with settlement of a lawsuit
with Roche/Genentech related to the Roche/Genentech patent right. Biogen is
vigorously opposing any attempt by Schering-Plough to discontinue payment of
royalties. If Schering-Plough were to prevail in arbitration, the resulting
decline in royalties on United States sales of alpha interferon products which
is in the range of up to approximately $10 million per quarter would continue
until July 2002.

There are a number of other factors which could also cause the actual level of
royalty revenue to differ from the Company's expectations. For example, pricing
reforms, health care reform initiatives, other legal and regulatory developments
and the introduction of competitive products may have an impact on product sales
by the Company's licensees. In addition, sales levels of products sold by the
Company's licensees may fluctuate from quarter to quarter due to the timing and
extent of major events such as new indication approvals or government sponsored
programs. Since the Company is not involved in the development or sale of
products by its licensees, the Company can not be certain of the timing or
potential impact of factors which may affect sales by the Company's licensees.
In the long term, the Company expects its royalty revenue to be affected most
significantly by patent expirations and a potential decrease in sales by
licensees of licensed products. See "Outlook - Patents and Other Proprietary
Rights."

There can be no assurance that the Company will achieve a positive outcome with
respect to any of the factors discussed in this Section or that the timing and
extent of the Company's success with respect to any combination of these factors
will be sufficient to result in sustained increases in revenues or profitability
or the sustained profitability of the Company. For a further discussion of risks
regarding drug development,

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patent matters, including the Berlex lawsuit on the "McCormick" patents and the
Amgen appeal, competition in the MS market and regulatory matters, see the
Company's Annual Report on Form 10-K for the period ended December 31, 2000
under the headings "Business - Risks Associated with Drug Development",
"Business - Patents and Other Proprietary Rights", "Business - Competition and
Marketing - AVONEX(R) (interferon beta-la)", "Business - Regulation", "Legal
Proceedings" and "Management's Discussion and Analysis of Financial Condition
and Results of Operations - Outlook."

PRODUCTS

AVONEX(R) is currently the only product sold by the Company. The Company's
long-term viability and growth will depend on the successful development and
commercialization of other products from its research activities and
collaborations. The Company continues to expand its development efforts related
to other potential products in its pipeline. The expansion of the pipeline may
include increases in spending on internal projects, the acquisition of
third-party technologies or products or other types of investments. Product
development involves a high degree of risk. Only a small number of research and
development programs result in the commercialization of a product. Success in
preclinical and early clinical trials does not ensure that later stage or large
scale clinical trials will be successful. Many important factors affect the
Company's ability to successfully develop and commercialize drugs, including the
ability to obtain and maintain necessary patents and licenses, to demonstrate
safety and efficacy of drug candidates at each stage of the clinical trial
process, to overcome technical hurdles that may arise, to meet applicable
regulatory standards, to receive required regulatory approvals, to be capable of
producing drug candidates in commercial quantities at reasonable costs, to
compete successfully against other products and to market products successfully.
There can be no assurance that the Company will be successful in its efforts to
develop and commercialize new products.


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PART II - OTHER INFORMATION

Item 5 - Other Information

None.

Item 6 - Exhibits and Reports on Form 8-K


(a) Exhibits

None.

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                                   SIGNATURES


Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.



                                              BIOGEN, INC.

Dated: May 15, 2001                           /s/ Peter N. Kellogg
                                              ---------------------------------
                                              Vice President - Finance and
                                              Chief Financial Officer



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