REGENERON PHARMACEUTICALS, INC.REGN
REGENERON PHARMACEUTICALS, INC. Stock Compensation Disclosure
Long-Term Incentive Plans
The Company has used long-term incentive plans for the purpose of granting equity awards to employees of the Company, including officers, and non-employee members of the Company's board of directors (collectively, "Participants"). The Participants may receive awards as determined by a committee of independent members of the Company's board of directors or, to the extent authorized by such committee with respect to certain Participants, a duly authorized employee (collectively, the "Committee"). The incentive plan currently used by the Company is the Second Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (the "Second Amended and Restated 2014 Incentive Plan"). It was most recently adopted and approved by the Company's shareholders in 2020. As of the most recent shareholder approval date, the Second Amended and Restated 2014 Incentive Plan provided for the issuance of up to 22.3 million shares of Common Stock in respect of awards. In addition, upon expiration, forfeiture, surrender, exchange, cancellation, or termination of any award previously granted under the Amended and Restated Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (the "Amended and Restated 2014 Incentive Plan"), the Regeneron Pharmaceuticals, Inc. 2014 Long-Term Incentive Plan (the "Original 2014 Incentive Plan"), or the Second Amended and Restated 2000 Long-Term Incentive Plan (the "2000 Incentive Plan"), any shares subject to such award are added to the pool of shares available for grant under the Second Amended and Restated 2014 Incentive Plan.
The awards that may be made under the Second Amended and Restated 2014 Incentive Plan include: (a) non-qualified stock options and incentive stock options, (b) restricted stock awards, (c) shares of phantom stock (also referred to as restricted stock units, which may be time- or performance-based), and (d) other awards. Any award granted may (but is not required to) be subject to vesting based on the attainment by the Company of performance goals pre-established by the Committee.
Stock option awards grant Participants the right to purchase shares of Common Stock at prices determined by the Committee, with exercise prices that are equal to or greater than the average of the high and low market prices of the Company's Common Stock on the date of grant (the "Market Price"). Options vest over a period of time determined by the Committee, generally on a pro rata basis over a four-year period. The Committee also determines the expiration date of each option. The maximum term of options that have been awarded under the 2000 Incentive Plan, the Original 2014 Incentive Plan, the Amended and Restated 2014 Incentive Plan, and the Second Amended and Restated 2014 Incentive Plan (collectively, the "Incentive Plans") is ten years.
Restricted stock awards grant Participants shares of restricted Common Stock. Such shares are nontransferable for a period determined by the Committee ("vesting period"). Should employment terminate, as specified in the Incentive Plans, except as determined by the Committee in its discretion and subject to the applicable Incentive Plan documents, the ownership of any unvested restricted stock awards will be transferred to the Company.
Phantom stock awards provide the Participant the right to receive Common Stock or an amount of cash based on the value of the Common Stock at a future date. The award is subject to such restrictions, if any, as the Committee may impose at the date of grant or thereafter, including a specified period of employment or the achievement of performance goals. Time-based restricted stock units and performance-based restricted stock units are each a type of phantom stock award permitted under the Second Amended and Restated 2014 Incentive Plan.
The Incentive Plans contain provisions that allow for the Committee to provide for the immediate vesting of awards upon a change in control of the Company, as defined in the Incentive Plans.
As of December 31, 2025, there were 12.4 million shares available for future grants under the Second Amended and Restated 2014 Incentive Plan.
a. Stock Options
The table below summarizes the activity related to stock option awards under the Company's Incentive Plans during 2025.
Number of Shares (In millions) | Weighted-Average Exercise Price | Weighted-Average Remaining Contractual Term | Intrinsic Value (In millions) | ||||||||||||||||||||||||||
Outstanding as of December 31, 2024 | 12.7 | $ | 588.47 | ||||||||||||||||||||||||||
2025: | Granted | 0.7 | $ | 691.40 | |||||||||||||||||||||||||
| Forfeited | (0.4) | $ | 752.01 | ||||||||||||||||||||||||||
| Exercised | (1.2) | $ | 519.17 | ||||||||||||||||||||||||||
Outstanding as of December 31, 2025 | 11.8 | $ | 596.65 | 5.7 years | $ | 2,185.9 | |||||||||||||||||||||||
Vested and expected to vest as of December 31, 2025 | 11.5 | $ | 592.93 | 5.7 years | $ | 2,178.9 | |||||||||||||||||||||||
Exercisable as of December 31, 2025 | 8.7 | $ | 536.47 | 4.7 years | $ | 2,100.0 | |||||||||||||||||||||||
The Company satisfies stock option exercises with newly issued shares of the Company's Common Stock. The total intrinsic value of stock options exercised during 2025, 2024, and 2023 was $193.6 million, $1.682 billion, and $1.096 billion, respectively. The intrinsic value represents the amount by which the market price of the underlying stock exceeds the exercise price of an option.
The table below summarizes the weighted-average exercise prices and weighted-average grant-date fair values of options granted during the years ended December 31, 2025, 2024, and 2023.
Number of Options Granted (In millions) | Weighted-Average Exercise Price | Weighted-Average Fair Value | ||||||||||||||||||
| 2025: | ||||||||||||||||||||
| Exercise price equal to Market Price | 0.7 | $ | 691.40 | $ | 206.58 | |||||||||||||||
| 2024: | ||||||||||||||||||||
| Exercise price equal to Market Price | 1.9 | $ | 786.79 | $ | 235.32 | |||||||||||||||
| 2023: | ||||||||||||||||||||
| Exercise price equal to Market Price | 1.6 | $ | 835.91 | $ | 264.37 | |||||||||||||||
For the years ended December 31, 2025, 2024, and 2023, the Company recognized $351.9 million, $376.0 million, and $357.1 million, respectively, of stock-based compensation expense related to stock option awards (net of amounts capitalized as inventory, which were not material for each of the three years). As of December 31, 2025, there was $385.8 million of stock-based compensation cost related to unvested stock options, net of estimated forfeitures, which had not yet been recognized. The Company expects to recognize this compensation cost over a weighted-average period of 1.7 years.
Fair Value Assumptions:
The following table summarizes the weighted average values of the assumptions used in computing the fair value of option grants during 2025, 2024, and 2023.
| 2025 | 2024 | 2023 | ||||||||||||||||||
| Expected volatility | 26 | % | 25 | % | 26 | % | ||||||||||||||
| Expected lives from grant date | 5.3 years | 5.0 years | 5.1 years | |||||||||||||||||
| Expected dividend yield | 0.49 | % | 0 | % | 0 | % | ||||||||||||||
| Risk-free interest rate | 3.79 | % | 4.11 | % | 4.29 | % | ||||||||||||||
Expected volatility has been estimated based on actual movements in the Company's stock price over the most recent historical periods equivalent to the options' expected lives. Expected lives are principally based on the Company's historical exercise experience with previously issued option grants. Expected dividend yield is based on the Company's historical practice and expectation of future dividend payments. During 2024 and 2023, the expected dividend yield was zero as the Company had not paid dividends nor did it expect to at the time of option grants. The risk-free interest rates are based on quoted U.S. Treasury rates for securities with maturities approximating the options' expected lives.
b. Restricted Stock Awards and Time-Based Restricted Stock Units
A summary of the Company's activity related to restricted stock awards and time-based restricted stock units (excluding performance-based restricted stock units, which are detailed further below) (collectively, "restricted stock") during 2025 is summarized below.
Number of Shares/Units (In millions) | Weighted-Average Grant Date Fair Value | ||||||||||||||||
Unvested as of December 31, 2024 | 2.5 | $ | 760.35 | ||||||||||||||
2025: | Granted | 1.4 | $ | 718.94 | |||||||||||||
| Vested | (0.7) | $ | 734.49 | ||||||||||||||
| Forfeited | (0.1) | $ | 753.77 | ||||||||||||||
Unvested as of December 31, 2025 | 3.1 | $ | 748.08 | ||||||||||||||
For the years ended December 31, 2025, 2024, and 2023, the Company recognized $589.8 million, $554.7 million, and $475.9 million, respectively, of stock-based compensation expense related to restricted stock (net of amounts capitalized as inventory, which were not material for each of the three years). As of December 31, 2025, there was $1.493 billion of stock-based compensation cost related to unvested restricted stock which had not yet been recognized. The Company expects to recognize this compensation cost over a weighted-average period of 2.3 years.
c. Performance-based Restricted Stock Units
Performance-based restricted stock units ("PSUs") have been granted to certain members of senior management of the Company. PSUs may be earned based upon the attainment of pre-established performance criteria, which may include a market and/or performance condition. Depending on the terms of the PSUs and the outcome of the pre-established performance criteria, a recipient may ultimately earn the target number of PSUs granted or a specified multiple thereof at the end of a 4–6 year vesting period, as applicable.
The table below summarizes activity related to PSUs during 2025. The number of unvested PSUs represents the maximum number of units that are eligible to be earned.
Number of Shares/Units (In millions) | Weighted-Average Grant Date Fair Value | ||||||||||||||||
Unvested as of December 31, 2024 | 1.4 | $ | 247.91 | ||||||||||||||
2025: | Vested | (1.2) | $ | 209.59 | |||||||||||||
Unvested as of December 31, 2025 | 0.2 | $ | 485.61 | ||||||||||||||
For each of the years ended December 31, 2025, 2024, and 2023 the Company recognized $52.0 million of stock-based compensation expense related to PSUs. As of December 31, 2025, there was no stock-based compensation cost expected to be recognized related to unvested PSUs.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 4, 2026 | Showing above |
| 2024 | Feb 5, 2025 | |
| 2023 | Feb 5, 2024 | |
| 2022 | Feb 6, 2023 | |
About Stock Compensation Disclosures
Stock-based compensation disclosures detail the equity awards granted to employees and executives — including stock options, restricted stock units (RSUs), and performance shares — along with the valuation methods and assumptions used to expense them. This section reveals the true cost of talent retention and the alignment between management incentives and shareholder interests.
Key signals: total unrecognized compensation expense and its expected recognition period signal future earnings headwinds from already-granted awards. For stock options, examine Black-Scholes assumptions — expected volatility, risk-free rate, and expected term — as understating any of these reduces reported compensation expense. Compare stock compensation expense as a percentage of revenue against peers to assess dilution cost. Watch vesting schedules for acceleration clauses tied to change-of-control events. Performance-based awards with undemanding targets may indicate weak governance. Add back stock compensation to operating cash flow to calculate a more conservative free cash flow figure.