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Leases
 12 Months Ended
Dec. 31, 2024
Leases [Abstract]  
Leases Leases
Operating Leases
Our operating leases relate to the majority of our real estate leases and each of our embedded leases with contract manufacturing organizations.
Corporate Headquarters
In 2011, we entered into two lease agreements, pursuant to which we lease approximately 1.1 million square feet of office and laboratory space in two buildings in Boston, Massachusetts for a term of 15 years (our “Corporate Headquarters”). In August 2024, we amended the existing lease agreements to, among other terms, extend the lease termination dates from December 2028 to June 2044 (the “Amendments”). We have the option to extend the amended leases for up to two additional ten-year periods.
The Amendments did not grant us any additional rights of use not contemplated in the existing lease agreements. As a result, we have accounted for the Amendments as modifications that extend the terms of the existing leases and reassessed the classification of the leases as of their effective dates. We remeasured the lease liabilities using our incremental borrowing rate
as of the effective date of the Amendments and classified the leases associated with our Corporate Headquarters as operating leases because none of the finance lease criteria were met. As of December 31, 2024, the adjusted right-of-use assets associated with our Corporate Headquarters, totaling $840.0 million, were recorded within “Operating lease assets” and the long-term portion of the remeasured lease liabilities of $1.0 billion were recorded within “Long-term operating lease liabilities.”
Prior to the Amendments, we classified the leases associated with our Corporate Headquarters as finance leases because the present value of the sum of the lease payments exceeded substantially all of the fair value of our Corporate Headquarters at lease inception. As of December 31, 2023, our Corporate Headquarters were recorded as assets with net book values of $177.0 million within “Property and equipment, net” and long-term liabilities of $258.1 million within “Long-term finance lease liabilities.”
As of December 31, 2024 and 2023, the amounts recorded within “Other current liabilities” related to our Corporate Headquarters were not material to our condensed consolidated balance sheets.
Jeffrey Leiden Center for Cell and Genetic Therapies
In 2019, we entered into an agreement to lease approximately 269,000 square feet of office and laboratory space near our corporate headquarters in Boston, Massachusetts for a term of 16 years. Base rent payments commenced in 2021 and will continue through November 2036. We utilize the initial period as our lease term. We have an option to extend the lease term for up to two additional ten-year periods.
Embedded Leases with Contract Manufacturing Organizations
We have several embedded leases with contract manufacturing organizations related to the manufacturing and commercialization of our products, which are classified as operating leases and have remaining lease terms up to 8 years as of December 31, 2024.
Finance Leases
As of December 31, 2024, our finance leases primarily relate to our research site in San Diego and land related to a facility that we own.
San Diego Lease
In 2015, we entered into a lease agreement pursuant to which we lease approximately 170,000 square feet of office and laboratory space in San Diego, California for a term of 16 years (the “San Diego Lease”). Base rent payments commenced in 2019 and will continue through May 2034. We utilize this initial period as our lease term. We have an option to extend the lease term for up to two additional five-year terms. The San Diego Lease is classified as a finance lease because the present value of the sum of its lease payments exceeded substantially all of the fair value of the research site at lease inception.
Please refer to our accounting policy, Leases, in Note A, “Nature of Business and Accounting Policies,” for further information on the accounting treatment for our finance and operating leases.
Aggregate Lease Information
The components of lease cost recorded in our consolidated statements of income were as follows:
Year ended December 31,
202420232022
(in millions)
Operating lease cost$103.9 $47.8 $35.3 
Finance lease cost
Amortization of leased assets30.9 42.7 51.0 
Interest on lease liabilities25.2 38.8 43.5 
Variable lease cost43.6 44.6 39.8 
Sublease income(1.6)(2.7)(2.7)
Net lease cost$202.0 $171.2 $166.9 
Our variable lease cost during 2024, 2023 and 2022 primarily related to operating expenses, taxes and insurance associated with our real estate leases.
Our leases are included on our consolidated balance sheets as follows:
As of December 31,
20242023
(in millions)
Operating leases
Operating lease assets$1,356.8 $293.6 
Total operating lease assets
$1,356.8 $293.6 
Other current liabilities$87.1 $33.1 
Long-term operating lease liabilities1,544.4 348.6 
Total operating lease liabilities
$1,631.5 $381.7 
Finance leases
Property and equipment, net$57.9 $272.8 
Total finance lease assets
$57.9 $272.8 
Other current liabilities$5.2 $50.6 
Long-term finance lease liabilities112.8 376.1 
Total finance lease liabilities
$118.0 $426.7 
Maturities of our finance and operating lease liabilities as of December 31, 2024 were as follows:
Year
Operating Leases
Finance Leases
Total
(in millions)
2025$167.3 $10.2 $177.5 
2026158.7 11.4 170.1 
2027157.9 11.8 169.7 
2028154.7 12.2 166.9 
2029102.8 12.5 115.3 
Thereafter
1,997.8 130.9 2,128.7 
Total lease payments
2,739.2 189.0 2,928.2 
Less: tenant allowance
(199.2)— (199.2)
Less: amount representing interest
(908.5)(71.0)(979.5)
Present value of lease liabilities
$1,631.5 $118.0 $1,749.5 
The weighted-average remaining lease terms and discount rates related to our leases were as follows:
As of December 31,
20242023
Weighted-average remaining lease term (in years)
Operating leases15.5811.24
Finance leases22.1710.06
Weighted-average discount rate
Operating leases4.61 %2.42 %
Finance leases
4.58 %8.20 %
Supplemental cash flow information related to our leases was as follows:
Year ended December 31,
202420232022
(in millions)
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases$113.5 $62.8 $50.8 
Operating cash flows from finance leases$25.7 $38.4 $42.5 
Financing cash flows from finance leases$33.6 $44.9 $85.5 
Right-of-use assets obtained in exchange for lease obligations
Operating leases
$1,120.9 $2.4 $58.6 
The right-of-use assets of $1.1 billion that are included in the table above for 2024 were obtained in exchange for operating lease obligations of $1.3 billion, including $847.9 million of right-of-use operating lease assets and $1.0 billion of operating lease obligations related to the Amendments for our Corporate Headquarters. The Amendments also resulted in a reduction to our finance leases of $275.3 million and a net reduction to our property and equipment of $107.5 million.
Leases Leases
Operating Leases
Our operating leases relate to the majority of our real estate leases and each of our embedded leases with contract manufacturing organizations.
Corporate Headquarters
In 2011, we entered into two lease agreements, pursuant to which we lease approximately 1.1 million square feet of office and laboratory space in two buildings in Boston, Massachusetts for a term of 15 years (our “Corporate Headquarters”). In August 2024, we amended the existing lease agreements to, among other terms, extend the lease termination dates from December 2028 to June 2044 (the “Amendments”). We have the option to extend the amended leases for up to two additional ten-year periods.
The Amendments did not grant us any additional rights of use not contemplated in the existing lease agreements. As a result, we have accounted for the Amendments as modifications that extend the terms of the existing leases and reassessed the classification of the leases as of their effective dates. We remeasured the lease liabilities using our incremental borrowing rate
as of the effective date of the Amendments and classified the leases associated with our Corporate Headquarters as operating leases because none of the finance lease criteria were met. As of December 31, 2024, the adjusted right-of-use assets associated with our Corporate Headquarters, totaling $840.0 million, were recorded within “Operating lease assets” and the long-term portion of the remeasured lease liabilities of $1.0 billion were recorded within “Long-term operating lease liabilities.”
Prior to the Amendments, we classified the leases associated with our Corporate Headquarters as finance leases because the present value of the sum of the lease payments exceeded substantially all of the fair value of our Corporate Headquarters at lease inception. As of December 31, 2023, our Corporate Headquarters were recorded as assets with net book values of $177.0 million within “Property and equipment, net” and long-term liabilities of $258.1 million within “Long-term finance lease liabilities.”
As of December 31, 2024 and 2023, the amounts recorded within “Other current liabilities” related to our Corporate Headquarters were not material to our condensed consolidated balance sheets.
Jeffrey Leiden Center for Cell and Genetic Therapies
In 2019, we entered into an agreement to lease approximately 269,000 square feet of office and laboratory space near our corporate headquarters in Boston, Massachusetts for a term of 16 years. Base rent payments commenced in 2021 and will continue through November 2036. We utilize the initial period as our lease term. We have an option to extend the lease term for up to two additional ten-year periods.
Embedded Leases with Contract Manufacturing Organizations
We have several embedded leases with contract manufacturing organizations related to the manufacturing and commercialization of our products, which are classified as operating leases and have remaining lease terms up to 8 years as of December 31, 2024.
Finance Leases
As of December 31, 2024, our finance leases primarily relate to our research site in San Diego and land related to a facility that we own.
San Diego Lease
In 2015, we entered into a lease agreement pursuant to which we lease approximately 170,000 square feet of office and laboratory space in San Diego, California for a term of 16 years (the “San Diego Lease”). Base rent payments commenced in 2019 and will continue through May 2034. We utilize this initial period as our lease term. We have an option to extend the lease term for up to two additional five-year terms. The San Diego Lease is classified as a finance lease because the present value of the sum of its lease payments exceeded substantially all of the fair value of the research site at lease inception.
Please refer to our accounting policy, Leases, in Note A, “Nature of Business and Accounting Policies,” for further information on the accounting treatment for our finance and operating leases.
Aggregate Lease Information
The components of lease cost recorded in our consolidated statements of income were as follows:
Year ended December 31,
202420232022
(in millions)
Operating lease cost$103.9 $47.8 $35.3 
Finance lease cost
Amortization of leased assets30.9 42.7 51.0 
Interest on lease liabilities25.2 38.8 43.5 
Variable lease cost43.6 44.6 39.8 
Sublease income(1.6)(2.7)(2.7)
Net lease cost$202.0 $171.2 $166.9 
Our variable lease cost during 2024, 2023 and 2022 primarily related to operating expenses, taxes and insurance associated with our real estate leases.
Our leases are included on our consolidated balance sheets as follows:
As of December 31,
20242023
(in millions)
Operating leases
Operating lease assets$1,356.8 $293.6 
Total operating lease assets
$1,356.8 $293.6 
Other current liabilities$87.1 $33.1 
Long-term operating lease liabilities1,544.4 348.6 
Total operating lease liabilities
$1,631.5 $381.7 
Finance leases
Property and equipment, net$57.9 $272.8 
Total finance lease assets
$57.9 $272.8 
Other current liabilities$5.2 $50.6 
Long-term finance lease liabilities112.8 376.1 
Total finance lease liabilities
$118.0 $426.7 
Maturities of our finance and operating lease liabilities as of December 31, 2024 were as follows:
Year
Operating Leases
Finance Leases
Total
(in millions)
2025$167.3 $10.2 $177.5 
2026158.7 11.4 170.1 
2027157.9 11.8 169.7 
2028154.7 12.2 166.9 
2029102.8 12.5 115.3 
Thereafter
1,997.8 130.9 2,128.7 
Total lease payments
2,739.2 189.0 2,928.2 
Less: tenant allowance
(199.2)— (199.2)
Less: amount representing interest
(908.5)(71.0)(979.5)
Present value of lease liabilities
$1,631.5 $118.0 $1,749.5 
The weighted-average remaining lease terms and discount rates related to our leases were as follows:
As of December 31,
20242023
Weighted-average remaining lease term (in years)
Operating leases15.5811.24
Finance leases22.1710.06
Weighted-average discount rate
Operating leases4.61 %2.42 %
Finance leases
4.58 %8.20 %
Supplemental cash flow information related to our leases was as follows:
Year ended December 31,
202420232022
(in millions)
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases$113.5 $62.8 $50.8 
Operating cash flows from finance leases$25.7 $38.4 $42.5 
Financing cash flows from finance leases$33.6 $44.9 $85.5 
Right-of-use assets obtained in exchange for lease obligations
Operating leases
$1,120.9 $2.4 $58.6 
The right-of-use assets of $1.1 billion that are included in the table above for 2024 were obtained in exchange for operating lease obligations of $1.3 billion, including $847.9 million of right-of-use operating lease assets and $1.0 billion of operating lease obligations related to the Amendments for our Corporate Headquarters. The Amendments also resulted in a reduction to our finance leases of $275.3 million and a net reduction to our property and equipment of $107.5 million.