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What changed in Alkermes plc.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Alkermes plc.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+424 added−348 removedSource: 10-K (2026-02-25) vs 10-K (2025-02-12)

Top changes in Alkermes plc.'s 2025 10-K

424 paragraphs added · 348 removed · 297 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

209 edited+105 added−21 removed455 unchanged
Biggest changeFactors that may cause revenues from our products to grow at a slower than expected rate, decrease or cease all together, include, among others: • the perception of physicians and other members of the healthcare community as to our products’ safety and efficacy relative to that of current or future competing products and the willingness or ability of physicians and other members of the healthcare community to prescribe, dispense and/or administer, and patients to use, our products; • unfavorable publicity concerning us, our licensees, our products, similar classes of drugs or our industry generally; 30 • the cost-effectiveness of our products and reimbursement policies of government and third-party payers that may impact use of our products; • the cost and availability of raw materials necessary for the manufacture of our products; • the successful manufacture of our products on a timely and cost-effective basis; • the size of the markets for our products, and patient and physician satisfaction with our products; • significant changes in the competitive landscape for our products, including any approvals of generic versions of our products or other branded products that may compete with our products; • adverse event information relating to our products or to similar classes of drugs; • changes to the product labels of our products, or of products within the same drug classes, to add new significant warnings or restrictions on use; • our ability to engage third parties to manufacture, package and/or distribute our products on acceptable terms, or at all; • the unfavorable outcome of investigations, arbitrations, litigation or other legal proceedings, including government requests for information related to one or more of our products, securities litigation, IP litigation, including so-called “Paragraph IV” litigation relating to products from which we receive revenue, litigation or other proceedings before the USPTO Patent Trial and Appeal Board (the “PTAB”) or its equivalent in other jurisdictions outside of the U.S., and any other litigation or arbitration related to any of our products; • regulatory developments and actions related to the manufacture, commercialization or continued use of our products, including FDA actions such as the issuance of a REMS or warning letter, or conduct of an audit by the FDA or another regulatory authority in which a manufacturing or quality deficiency is identified; • the extent and effectiveness of the sales, marketing and distribution support for our products, including the size of our and our licensees’ sales forces and investments in marketing strategies, and our and our licensees’ decisions as to the timing and volume of product orders and shipments, the timing of product launches, and product pricing and discounting; • disputes with our licensees relating to the use of our technology in, and marketing and sale of, products from which we received, or currently receive, manufacturing and/or royalty revenue and the amounts and duration of payments to be made with respect to such products; • exchange rate valuations and fluctuations; • U.S. and global political and administrative changes, conflicts and/or instability, public health matters, economic conditions and/or any related changes in applicable laws and regulations or federal and state policy efforts, that may impact resources and markets for our products or the systems and environments in which we operate; and • any other material adverse developments with respect to the commercialization of our products.
Biggest changeFactors that may cause revenues from our products to grow at a slower than expected rate, decrease or cease all together, include, among others: • the perception of physicians and other members of the healthcare community as to our products’ safety and efficacy relative to that of current or future competing products and the willingness or ability of physicians and other members of the healthcare community to prescribe, dispense and/or administer, and patients to use, our products, including those that are scheduled by the DEA; 34 • unfavorable publicity concerning us, our licensees, our products, similar classes of drugs or our industry generally; • the cost-effectiveness of our products and reimbursement policies of government and third-party payers that may impact use of our products; • our ability to obtain and/or maintain regulatory exclusivities, including orphan drug exclusivity for LUMRYZ; • with respect to LUMRYZ, our ability and the ability of our certified pharmacies, physicians and patients to meet the requirements under the REMS, and physician and patient perception and assessment of the burdens associated with obtaining LUMRYZ in compliance with the REMS; • the cost and availability of raw materials necessary for the manufacture of our products; • the successful manufacture of our products on a timely and cost-effective basis; • our ability to engage third parties to manufacture, package and/or distribute our products on acceptable terms, or at all; • the size of the markets for our products, and patient and physician satisfaction with our products; • significant changes in the competitive landscape for our products, including any approvals of generic versions of our products or other branded products that may compete with our products; • adverse event information relating to our products or to similar classes of drugs; • changes to the product labels of our products, or of products within the same drug classes, to add new significant warnings or restrictions on use; • the unfavorable outcome of investigations, arbitrations, litigation or other legal proceedings, including government requests for information related to one or more of our products, securities litigation, IP litigation, including so-called “Paragraph IV” litigation relating to products from which we receive revenue, litigation or other proceedings before the USPTO Patent Trial and Appeal Board (the “PTAB”) or its equivalent in other jurisdictions outside of the U.S., and any other litigation or arbitration related to any of our products; • regulatory developments and actions related to the manufacture, commercialization or continued use of our products, including FDA actions such as the issuance or modification of a REMS or issuance of an untitled or warning letter, or conduct of an audit by the FDA, the DEA, or another regulatory authority in which a manufacturing or quality deficiency is identified; • the extent and effectiveness of the sales, marketing and distribution support for our products, including the size of our and our licensees’ sales forces and investments in marketing strategies, and our and our licensees’ decisions as to the timing and volume of product orders and shipments, the timing of product launches, and product pricing and discounting; • disputes with our licensees relating to the use of our technology in, and marketing and sale of, products from which we received, or currently receive, manufacturing and/or royalty revenue and the amounts and duration of payments to be made with respect to such products; • exchange rate valuations and fluctuations; • issuance and/or implementation of rules by CMS or other federal agencies that lessen the net revenue we receive on the sale of our products or that serve to alter the prices of competitors’ products with which we compete; • the impact of participation in the MDRP and 340B programs on the sales of our products, including the net revenue received from such sales; • U.S. and global political and administrative changes, conflicts and/or instability, public health matters, economic conditions and/or any related changes in applicable laws and regulations or federal and state policy efforts, that may impact resources and markets for our products or the systems and environments in which we operate; and • any other material adverse developments with respect to the commercialization of our products. 35 Revenues generated by sales of our products depend, in part, on the availability from third-party payers of reimbursement for our products and the extent of cost-sharing arrangements for patients (e.g., patient co-payment, co-insurance, deductible obligations) and cost-control measures imposed, and any reductions in payment rate or reimbursement or increases in our or in patients’ financial obligation to payers could result in decreased sales of our products and/or decreased revenues.
INVEGA SUSTENNA/XEPLION is manufactured by Janssen. INVEGA TRINZA is approved in the U.S. for the treatment of schizophrenia in patients who have been adequately treated with INVEGA SUSTENNA for at least four months. TREVICTA is approved in the EU for the maintenance treatment of schizophrenia in adult patients who are clinically stable on XEPLION. INVEGA TRINZA/TREVICTA is manufactured by Janssen.
INVEGA SUSTENNA/XEPLION is manufactured by Janssen. INVEGA TRINZA is approved in the U.S. for the treatment of schizophrenia in patients who have been adequately treated with INVEGA SUSTENNA for at least four months. TREVICTA is approved in the EU for the maintenance treatment of schizophrenia in adult patients who are clinically stable on XEPLION.
Our arrangements with licensees are critical to bringing to market and/or successfully commercializing products using our proprietary technologies and from which we receive manufacturing and/or royalty revenue.
Our arrangements with licensees are critical to successfully commercializing and/or bringing to market products using our proprietary technologies and from which we receive manufacturing and/or royalty revenue.
Even if we succeed in our efforts to obtain rights to suitable products, product candidates, or technologies, the competitive business environment may result in high transaction costs, and our investment in these potential assets would remain subject to the inherent risks associated with the development and commercialization of new medicines and may not yield the growth or success that we anticipate, which could have a material adverse effect on our business and financial results and the market price of our ordinary shares.
Even if we succeed in our efforts to obtain rights to suitable products, product candidates, or technologies, the competitive business environment may result in high transaction costs, and our investment in these potential assets remain, or would remain, subject to the inherent risks associated with the development and commercialization of new medicines and may not yield the growth or success that we anticipate, which could have a material adverse effect on our business and financial results and the market price of our ordinary shares.
We rely solely on our manufacturing facility in Wilmington, Ohio for the manufacture of VIVITROL, ARISTADA, ARISTADA INITIO, LYBALVI and RISPERDAL CONSTA.
We rely solely on our manufacturing facility in Wilmington, Ohio for the manufacture of ARISTADA, ARISTADA INITIO, LYBALVI, RISPERDAL CONSTA and VIVITROL.
The FDA and various regulatory agencies outside the U.S. have inspected and approved our commercial manufacturing facilities. However, the FDA and any other regulatory agencies may not approve any other facility that we or our third-party providers may operate and, once approved, any of these facilities may not remain in compliance with cGMP and other regulations.
The FDA and various regulatory agencies outside the U.S. have inspected and approved our commercial manufacturing facility. However, the FDA and any other regulatory agencies may not approve any other facility that we or our third-party providers may operate and, once approved, any of these facilities may not remain in compliance with cGMP and other regulations.
The loss of key personnel due to any of these factors or our inability to hire and retain personnel who have technical, scientific, manufacturing, management, regulatory, legal, compliance or commercial backgrounds could materially adversely impact our business, including the achievement of our manufacturing, research and development, commercial, financial and other operational and strategic business objectives.
The loss of key personnel due to any of these or other factors or our inability to hire and retain personnel who have technical, scientific, manufacturing, management, regulatory, legal, compliance or commercial backgrounds could materially adversely impact our business, including the achievement of our manufacturing, research and development, commercial, financial and other operational and strategic business objectives.
For example, in August 2023, following a trial in the Teva patent infringement lawsuit discussed above, we entered into a confidential settlement and license agreement (the “Settlement Agreement”) with Teva in August 2023 to resolve the proceedings between the parties.
For example, in August 2023, following a trial in the Teva patent infringement lawsuit discussed above, we entered into a confidential settlement and license agreement (the “Settlement Agreement”) with Teva to resolve the proceedings between the parties.
The GDPR also imposes additional obligations on, and required contractual provisions to be included in, contracts between companies subject to the GDPR and their third-party processors that relate to the processing of personal data.
The GDPR also imposes additional obligations on, and required contractual provisions to be included in, contracts between companies subject to the GDPR and their third-party processors that relate to the processing of personal data.
Additionally, the use of artificial intelligence tools (“AI”) is increasing in the biopharmaceutical industry and, as with many developing technologies, presents risks and challenges that could affect its further development, adoption and use.
Additionally, the use of artificial intelligence (“AI”) tools is increasing in the biopharmaceutical industry and, as with many developing technologies, presents risks and challenges that could affect its further development, adoption and use.
See “Item 1A—Risk Factors” in this Annual Report and specifically those sections entitled “If there are changes in, or we fail to comply with, the extensive legal and regulatory requirements affecting the healthcare industry, we could be subject to investigations, litigation, costs, penalties and business losses,” “Revenues generated by sales of our products depend, in part, on the availability from third-party payers of reimbursement for our products and the extent of cost-sharing arrangements for patients (e.g., patient co-payment, co-insurance, deductible obligations) and cost-control measures imposed, and any reductions in payment rate or reimbursement or increases in our or in patients’ financial obligation to payers could result in decreased sales of our products and/or decreased revenues” and “The clinical study or commercial use of our products may cause unintended side effects or adverse reactions, or incidents of misuse may occur, which could adversely affect our products, business and share price.” Laws and regulations have been enacted by the U.S. federal government and various states to regulate the sales and marketing practices of pharmaceutical manufacturers.
See “Item 1A—Risk Factors” in this Annual Report and specifically those sections entitled “If there are changes in, or we fail to comply with, the extensive legal and regulatory requirements affecting the 27 healthcare industry, we could be subject to investigations, litigation, costs, penalties and business losses,” “Revenues generated by sales of our products depend, in part, on the availability from third-party payers of reimbursement for our products and the extent of cost-sharing arrangements for patients (e.g., patient co-payment, co-insurance, deductible obligations) and cost-control measures imposed, and any reductions in payment rate or reimbursement or increases in our or in patients’ financial obligation to payers could result in decreased sales of our products and/or decreased revenues” and “The clinical study or commercial use of our products may cause unintended side effects or adverse reactions, or incidents of misuse may occur, which could adversely affect our products, business and share price.” Laws and regulations have been enacted by the U.S. federal government and various states to regulate the sales and marketing practices of pharmaceutical manufacturers.
Factors that may impact our future spend, and in turn our future profitability, include, among others: • the scope of our research and development activities, including the number of programs, products, indications or new technologies that we may pursue, and our ability, if sought, to share development costs through potential collaborations; • the time and expense required to pursue FDA and/or other regulatory approvals for our products; • the time and expense required to prosecute, enforce, defend and/or challenge patent and other IP rights; • the costs of operating and maintaining our manufacturing and research facilities, including the costs and availability of raw materials or components of our products; • the costs of doing business with third-party vendors, including suppliers, manufacturers, packagers and distributors and CROs; • the scope and costs of our commercial activities, including expansion of our sales force and our investment in direct-to-consumer campaigns and other initiatives; • the cost of possible business development activities, including licenses or acquisitions of technologies, compounds or product rights or the potential acquisition of other assets, including equipment, facilities or businesses; • the costs related to potential litigation, arbitration or other legal proceedings or government requests for information; • the costs of defending against potential or actual proxy contests or other activist shareholder actions; 43 • the costs of compliance with new regulations applicable to us, including those related to the measurement, reporting and assurance of environmental performance data and other sustainability matters; and • the costs associated with recruiting, compensating and retaining a highly-skilled workforce in an environment where competition for highly-skilled employees is intense.
Factors that may impact our future spend, and in turn our future profitability, include, among others: • the scope of our research and development activities, including the number of programs, products, indications or new technologies that we may pursue, and our ability, if sought, to share development costs through potential collaborations; • the time and expense required to pursue FDA and/or other regulatory approvals for our products; • the time and expense required to prosecute, enforce, defend and/or challenge patent and other IP rights; • the costs of operating and maintaining our manufacturing and research facilities, including the costs and availability of raw materials or components of our products; • the costs of doing business with third-party vendors, including suppliers, manufacturers, packagers and distributors and CROs; • the scope and costs of our commercial activities, including expansion of our sales force and our investment in direct-to-consumer campaigns and other initiatives; • the cost of possible business development activities, including licenses or acquisitions of technologies, compounds or product rights or the potential acquisition of other assets, including equipment, facilities or businesses; 49 • the costs related to potential litigation, arbitration or other legal proceedings or government requests for information; • the costs of defending against potential or actual proxy contests or other activist shareholder actions; • the costs of compliance with new regulations applicable to us, including those related to the measurement, reporting and assurance of environmental performance data and other sustainability matters; and • the costs associated with recruiting, compensating and retaining a highly-skilled workforce in an environment where competition for highly-skilled employees is intense.
In addition to the centralized procedure, Europe also has: (i) a nationalized procedure, which requires a separate application to, and approval determination by, each country; (ii) a decentralized procedure, whereby applicants submit identical applications to several countries and receive simultaneous approval; and (iii) a mutual recognition procedure, where applicants submit an application to one country for review and other countries may accept or reject the initial decision.
In addition to this centralized procedure, Europe also has: (i) a nationalized procedure, which requires a separate application to, and approval determination by, each country; (ii) a decentralized procedure, whereby applicants submit identical applications to several countries and receive simultaneous approval; and (iii) a mutual recognition procedure, where applicants submit an application to one country for review and other countries may accept or reject the initial decision.
Even if favorable coverage and reimbursement status is attained for one or more products for which we have received regulatory approval, less favorable coverage policies and reimbursement rates may be implemented in the future. Outside the United States Within the EU, products are paid for by a variety of payers, with governments being the primary source of payment.
Even if favorable coverage and reimbursement status is attained for one or more products for which we have received regulatory approval, less favorable coverage policies and reimbursement rates may be implemented in the future. 30 Outside the United States Within the EU, products are paid for by a variety of payers, with governments being the primary source of payment.
Recent budgetary pressures in many EU countries are causing governments to consider or implement various cost-containment measures, such as price freezes, increased price cuts and rebates, and expanded generic substitution and patient cost-sharing. If budget pressures continue, governments may implement additional cost-containment measures. 26 Other Regulations Foreign Corrupt Practices Act : We are subject to the U.S.
Recent budgetary pressures in many EU countries are causing governments to consider or implement various cost-containment measures, such as price freezes, increased price cuts and rebates, and expanded generic substitution and patient cost-sharing. If budget pressures continue, governments may implement additional cost-containment measures. Other Regulations Foreign Corrupt Practices Act : We are subject to the U.S.
Once approval from a regulatory agency is obtained, if a company makes a material change in manufacturing equipment, location or process, 22 additional regulatory review and approval may be required. Companies also must adhere to cGMP and product-specific regulations enforced by the FDA and other regulatory agencies both in the manufacture of clinical product and following product approval.
Once approval from a regulatory agency is obtained, if a company makes a material change in manufacturing equipment, location or process, additional regulatory review and approval may be required. Companies also must adhere to cGMP and product-specific regulations enforced by the FDA and other regulatory agencies both in the manufacture of clinical product and following product approval.
The FDA is prohibited from accepting any abbreviated new drug application (“ANDA”) for a generic drug or 505(b)(2) application referencing the NCE for five years from the date of approval of the NCE, or four years in the case of an ANDA or 505(b)(2) application containing a patent challenge, and in both cases may not approve such generic drug or 505(b)(2) application until expiration of NCE marketing exclusivity.
The FDA is prohibited from accepting any 26 abbreviated new drug application (“ANDA”) for a generic drug or 505(b)(2) application referencing the NCE for five years from the date of approval of the NCE, or four years in the case of an ANDA or 505(b)(2) application containing a patent challenge, and in both cases may not approve such generic drug or 505(b)(2) application until expiration of NCE marketing exclusivity.
The source, timing and availability of any financing will depend on global economic conditions, credit and financial market conditions, interest rates and other factors. If we issue additional equity securities or securities convertible into equity securities, our shareholders would suffer dilution of their investment, and it may adversely affect the market price of our ordinary shares.
The source, timing and availability of any future additional financing will depend on global economic conditions, credit and financial market conditions, interest rates and other factors. If we issue additional equity securities or securities convertible into equity securities, our shareholders would suffer dilution of their investment, and it may adversely affect the market price of our ordinary shares.
The ability of the FDA or other regulatory agencies to review and approve new products or manage post-approval requirements for marketed products can be affected by a variety of factors, including government budget and funding levels, ability to hire and retain key personnel and accept the payment of user fees, and statutory, regulatory, and policy changes.
The ability of the FDA or other regulatory agencies to review and approve new products or manage post-approval requirements for marketed products can be affected by a variety of factors, including government budget and funding levels, ability to hire and retain key personnel and accept the payment of user fees, and statutory, regulatory, political and policy changes.
We believe that we use customary pharmaceutical company practices to market our products, including through advertisements, professional symposia, selling initiatives and other methods, and to educate individual physicians, nurses, social workers, counselors and other stakeholders involved in the treatment of opioid dependence, alcohol dependence, schizophrenia and bipolar I disorder.
We believe that we use customary pharmaceutical company practices to market our products, including through advertisements, professional symposia, selling initiatives and other methods, and to educate individual physicians, nurses, social workers, counselors and other stakeholders involved in the treatment of opioid dependence, alcohol dependence, schizophrenia, bipolar I disorder and narcolepsy.
Other pharmaceutical companies are developing products for the treatment of schizophrenia that, if approved by the FDA, would compete with LYBALVI. In the treatment of bipolar I disorder, LYBALVI and RISPERDAL CONSTA compete with antipsychotics such as oral aripiprazole; VRAYLAR; ABILIFY MAINTENA; ABILIFY ASIMTUFII; CAPLYTA; RYKINDO; risperidone; quetiapine; olanzapine; and ziprasidone.
Other pharmaceutical companies are developing products for the treatment of schizophrenia that, if approved by the FDA, would compete with LYBALVI. In the treatment of bipolar I disorder, LYBALVI and RISPERDAL CONSTA compete with antipsychotics such as oral aripiprazole; VRAYLAR; ABILIFY MAINTENA; ABILIFY ASIMTUFII; CAPLYTA; RYKINDO; UZEDY; risperidone; quetiapine; olanzapine; and ziprasidone.
For example, the FDA may require, as a condition of approval, restricted distribution and use, enhanced labeling, special packaging or 21 labeling, expedited reporting of certain adverse events, pre-approval of promotional materials or restrictions on direct-to-consumer advertising, any of which could negatively impact the commercial success of a drug.
For example, the FDA may require, as a condition of approval, restricted distribution and use, enhanced labeling, special packaging or labeling, expedited reporting of certain adverse events, pre-approval of promotional materials or restrictions on direct-to-consumer advertising, any of which could negatively impact the commercial success of a drug.
If we were to be unsuccessful in resolving any such tax controversy in our favor, we could be liable for significant additional U.S. federal and state income tax than those we anticipate, which would materially adversely affect our financial condition, cash flows and results of operations.
If we were to be unsuccessful in resolving any such tax controversy in our favor, we could be liable for significant additional U.S. federal and state income tax than those we 51 anticipate, which would materially adversely affect our financial condition, cash flows and results of operations.
Third-party payers are increasingly challenging the prices charged for medical products and examining the medical necessity and cost-effectiveness of medical products, in addition to their safety and efficacy. 24 Medicaid is a joint federal and state program that is administered by the states for low-income and disabled beneficiaries.
Third-party payers are increasingly challenging the prices charged for medical products and examining the medical necessity and cost-effectiveness of medical products, in addition to their safety and efficacy. Medicaid is a joint federal and state program that is administered by the states for low-income and disabled beneficiaries.
If we are unable to obtain renewal of share issuance authorities from our shareholders, or are otherwise 46 limited by the terms of new share issuance authorities approved by our shareholders, our ability to use our authorized but unissued share capital to effect or to fund acquisition or other transaction opportunities, or to otherwise raise capital, could be adversely affected.
If we are unable to obtain renewal of share issuance authorities from our shareholders, or are otherwise limited by the terms of new share issuance authorities approved by our shareholders, our ability to use our authorized but unissued share capital to effect or to fund acquisition or other transaction opportunities, or to otherwise raise capital, could be adversely affected.
We require that our contract manufacturers adhere to cGMP in the manufacture of our products or components of our products for clinical use. Research & Development We devote significant resources to R&D programs. We focus our R&D efforts on developing novel therapeutics in areas of high unmet medical need.
We require that our contract manufacturers adhere to cGMP in the manufacture of our products or components of our products for clinical use. 16 Research & Development We devote significant resources to R&D programs. We focus our R&D efforts on developing novel therapeutics in areas of high unmet medical need.
The regulation further made clear that 5i drugs would qualify as “not generally dispensed” and, therefore, able to use the alternative AMP calculation, if not more than thirty percent (30%) of their sales were to RCPs or to wholesalers for RCPs.
The regulation further made clear that 5i drugs would qualify as “not generally dispensed” and, therefore, able to use the alternative AMP calculation, if not 29 more than thirty percent (30%) of their sales were to RCPs or to wholesalers for RCPs.
Government enforcement agencies have shown increased interest in pharmaceutical companies' product and patient assistance programs, including reimbursement support services, and a number of investigations into these programs have resulted in significant civil and criminal settlements. Our payment support programs could become the target of similar actions.
Government enforcement agencies have shown increased interest in pharmaceutical companies’ product and patient assistance programs, including reimbursement support services, and a number of investigations into these programs have resulted in significant civil and criminal settlements. Our patient support programs could become the target of similar actions.
Price recalculations also may affect the ceiling price at which we are required to offer our products under the 340B program and give rise to an obligation to refund entities participating in the 340B program for overcharges during past quarters impacted by a price recalculation. 41 Civil monetary penalties can be applied if we are found to have knowingly submitted any false price or product information to the government, if we are found to have made a misrepresentation in the reporting of our average sales price, if we fail to submit the required price data on a timely basis, or if we are found to have charged 340B covered entities more than the statutorily mandated ceiling price.
Price recalculations also may affect the ceiling price at which we are required to offer our products under the 340B program and give rise to an obligation to refund entities participating in the 340B program for overcharges during past quarters impacted by a price recalculation. 47 Civil monetary penalties can be applied if we are found to have knowingly submitted any false price or product information to the government, if we are found to have made a misrepresentation in the reporting of our average sales price, if we fail to submit the required price data on a timely basis, or if we are found to have charged 340B covered entities more than the statutorily mandated ceiling price.
Lundbeck A/S plc; VRAYLAR (cariprazine), which is marketed and sold by Abbvie Inc.; COBENFY (xanomeline and trospium chloride), which is marketed and sold by Bristol-Myers Squibb Company; other oral compounds currently on the market; and generic versions of branded oral products.
Lundbeck A/S plc; VRAYLAR (cariprazine), which is marketed and sold by Abbvie Inc.; COBENFY (xanomeline and trospium chloride), which is marketed and sold by Bristol-Myers Squibb Company; UZEDY; other oral compounds currently on the market; and generic versions of branded oral products.
Pricing and reimbursement for our products may be adversely affected by a number of factors, including: changes in, and implementation of, federal or state government regulations or private third-party payors’ reimbursement policies; pressure by employers on private health insurance plans to reduce costs; and consolidation and increasing assertiveness of payors and pharmacy benefit managers (“PBMs”) seeking price discounts or 31 rebates in connection with the placement of our products on their formularies and, in some cases, the imposition of restrictions on access or coverage of particular drugs or pricing determined based on perceived value.
Pricing and reimbursement for our products may be adversely affected by a number of factors, including: changes in, and implementation of, federal or state government regulations, legislation or private third-party payors’ reimbursement policies; pressure by employers on private health insurance plans to reduce costs; and consolidation and increasing assertiveness of payors and pharmacy benefit managers (“PBMs”) seeking price discounts or rebates in connection with the placement of our products on their formularies and, in some cases, the imposition of restrictions on access or coverage of particular drugs or pricing determined based on perceived value.
If any ANDA filers were to receive FDA approval to sell generic versions of our products or the products from which we receive revenue and/or prevail in any patent litigation with respect to such products, our business, financial condition, cash flows and results of operations could be materially adversely affected. 40 Risks Related to Regulatory or Legal Matters Litigation or arbitration filed against Alkermes, including securities litigation, or actions (such as citizens petitions) filed against regulatory agencies in respect of our products, may result in financial losses, harm our reputation, divert management resources, negatively impact the approval of our products, or otherwise negatively impact our business.
If any ANDA filers were to receive FDA approval to sell generic versions of our products or the products from which we receive revenue and/or prevail in any patent litigation with respect to such products, our business, financial condition, cash flows and results of operations could be materially adversely affected. 46 Risks Related to Regulatory or Legal Matters Litigation or arbitration filed against Alkermes, including securities litigation, or actions (such as citizens petitions) filed against regulatory agencies in respect of our products, may result in financial losses, harm our reputation, divert management resources, negatively impact the approval of our products, or otherwise negatively impact our business.
In connection with the separation of our oncology business into Mural Oncology plc completed in November 2023, we sought and received a private letter ruling from the IRS (the “IRS Ruling”) and an opinion from our U.S. tax advisor (the “U.S.
In connection with the separation of our oncology business into Mural Oncology plc (“Mural”) completed in November 2023, we sought and received a private letter ruling from the IRS (the “IRS Ruling”) and an opinion from our U.S. tax advisor (the “U.S.
We rely heavily on our licensees in the commercialization and continued development of products from which we receive revenue and, if our licensees are not effective, or if disputes arise in respect of our contractual arrangements, our revenues could be materially adversely affected.
We rely on our licensees in the commercialization and continued development of products from which we receive revenue and, if our licensees are not effective, or if disputes arise in respect of our contractual arrangements, our revenues could be materially adversely affected.
Timelines for the initiation, conduct and completion of clinical trials may be delayed by many factors, including: • issues with the opening, operation or inspection of a new or ongoing clinical trial site, including those located in or near geographic areas of conflict or areas impacted by political, environmental, public health or economic events; • delays or failures of third-party CROs and other third-party service providers and clinical investigators to manage and conduct the trials, perform oversight of the trials, including data audit and verification procedures, or to meet expected timelines; • an inability to recruit, enroll and retain clinical trial participants at the expected rate or at all, or to adequately follow participants after treatment; • safety or tolerability issues that may arise during clinical trials; • an inability to manufacture or obtain sufficient quantities of materials used for clinical trials; and 34 • unforeseen governmental or regulatory issues or concerns, including those of the FDA and other regulatory agencies, that may impact the strategies for, and design, timelines or feasibility of, our clinical development programs.
Timelines for the initiation, conduct and completion of clinical trials may be delayed by many factors, including: • issues with the opening, operation or inspection of a new or ongoing clinical trial site, including those located in or near geographic areas of conflict or areas impacted by political, environmental, public health or economic events; • delays or failures of third-party CROs and other third-party service providers and clinical investigators to manage and conduct the trials, perform oversight of the trials, including data audit and verification procedures, or to meet expected timelines; • an inability to recruit, enroll and retain clinical trial participants at the expected rate or at all, or to adequately follow participants after treatment; • safety or tolerability issues that may arise during clinical trials; • an inability to manufacture or obtain sufficient quantities of materials used for clinical trials; and • unforeseen governmental or regulatory issues or concerns, including those of the FDA, the DEA and other regulatory 39 agencies, that may impact the strategies for, and design, timelines or feasibility of, our clinical development programs.
There are no further milestones to be earned under this agreement. The agreement also provides for royalty 11 payments, which consist of a patent royalty and a know-how royalty, both of which are determined on a country-by-country basis.
There are no further milestones to be earned under this agreement. The agreement also provides for royalty payments, which consist of a patent royalty and a know-how royalty, both of which are determined on a country-by-country basis.
Our trademarks, including VIVITROL, ARISTADA, ARISTADA INITIO and LYBALVI, are important to us and are generally covered by trademark applications or registrations with the U.S. Patent and Trademark Office (the “USPTO”) and the patent or trademark offices of other countries.
Our trademarks, including ARISTADA, ARISTADA INITIO, LUMRYZ, LYBALVI and VIVITROL, are important to us and are generally covered by trademark applications or registrations with the U.S. Patent and Trademark Office (the “USPTO”) and the patent or trademark offices of other countries.
For information about risks relating to the manufacture of our marketed products and product candidates, see “Item 1A—Risk Factors” in this Annual Report and specifically those sections entitled “We rely on third parties to provide goods and services in connection with the manufacture and distribution of the products we manufacture” and “We are subject to risks related to the manufacture of our products.” Marketed Products We manufacture ARISTADA, ARISTADA INITIO, LYBALVI, VIVITROL and microspheres for RISPERDAL CONSTA at our Wilmington, Ohio facility.
For information about risks relating to the manufacture of our marketed products and product candidates, see “Item 1A—Risk Factors” in this Annual Report and specifically those sections entitled “We rely on third parties to provide goods and services in connection with the manufacture and distribution of our products” and “We are subject to risks related to the manufacture of our products.” Marketed Products We manufacture ARISTADA, ARISTADA INITIO, LYBALVI, VIVITROL and microspheres for RISPERDAL CONSTA at our Wilmington, Ohio facility.
The Inflation Reduction Act includes several provisions that will impact our business to varying degrees, including those that impose new manufacturer financial liability on all drugs in Medicare Part D beginning in 2025, allow the U.S. government to negotiate prices for some drugs covered under Medicare Part D beginning in 2026 and Medicare Part B beginning in 2028, and require companies to pay rebates to Medicare for drug prices that increase faster than inflation.
The Inflation Reduction Act includes several provisions that will impact our business to varying degrees, including those that imposed new manufacturer financial liability on all drugs in Medicare Part D beginning in 2025, allow the U.S. government to negotiate prices for some drugs covered under Medicare Part D beginning in 2026 and Medicare Part B beginning in 2028, and require companies to pay rebates to Medicare for drug prices that increase faster than inflation.
Product(s) Covered Expiration Date 8,431,576 ARISTADA; ARISTADA INITIO 2030 8,796,276 ARISTADA; ARISTADA INITIO 2030 10,112,903 ARISTADA; ARISTADA INITIO 2030 10,023,537 ARISTADA 2030 10,351,529 ARISTADA; ARISTADA INITIO 2030 11,518,745 ARISTADA; ARISTADA INITIO 2030 12,180,164 ARISTADA; ARISTADA INITIO 2030 11,273,158 ARISTADA; ARISTADA INITIO 2039 9,034,867 ARISTADA 2032 10,226,458 ARISTADA 2032 9,193,685 ARISTADA 2033 9,861,699 ARISTADA 2033 10,342,877 ARISTADA 2033 10,639,376 ARISTADA 2033 11,097,006 ARISTADA 2033 11,969,469 ARISTADA 2033 9,452,131 ARISTADA 2035 9,526,726 ARISTADA 2035 10,064,859 ARISTADA 2035 10,238,651 ARISTADA 2035 10,478,434 ARISTADA 2035 10,813,928 ARISTADA 2035 10,973,816 ARISTADA 2035 11,406,632 ARISTADA 2035 11,883,394 ARISTADA 2035 10,016,415 ARISTADA INITIO 2035 10,688,091 ARISTADA INITIO 2035 10,849,894 ARISTADA INITIO 2035 11,115,552 ARISTADA INITIO 2035 VIVITROL We have a number of patents and pending patent applications covering our microsphere technology throughout the world, which, to some extent, cover VIVITROL.
Product(s) Covered Expiration Date 8,431,576 ARISTADA; ARISTADA INITIO 2030 8,796,276 ARISTADA; ARISTADA INITIO 2030 10,112,903 ARISTADA; ARISTADA INITIO 2030 10,023,537 ARISTADA 2030 10,351,529 ARISTADA; ARISTADA INITIO 2030 11,518,745 ARISTADA; ARISTADA INITIO 2030 12,180,164 ARISTADA; ARISTADA INITIO 2030 11,273,158 ARISTADA; ARISTADA INITIO 2039 12,251,381 ARISTADA; ARISTADA INITIO 2039 9,034,867 ARISTADA 2032 10,226,458 ARISTADA 2032 9,193,685 ARISTADA 2033 9,861,699 ARISTADA 2033 10,342,877 ARISTADA 2033 10,639,376 ARISTADA 2033 11,097,006 ARISTADA 2033 11,969,469 ARISTADA 2033 12,311,027 ARISTADA 2033 9,452,131 ARISTADA 2035 9,526,726 ARISTADA 2035 10,064,859 ARISTADA 2035 10,238,651 ARISTADA 2035 10,478,434 ARISTADA 2035 10,813,928 ARISTADA 2035 10,973,816 ARISTADA 2035 11,406,632 ARISTADA 2035 11,883,394 ARISTADA 2035 10,016,415 ARISTADA INITIO 2035 10,688,091 ARISTADA INITIO 2035 10,849,894 ARISTADA INITIO 2035 11,115,552 ARISTADA INITIO 2035 VIVITROL We have a number of patents and pending patent applications covering our microsphere technology throughout the world, which, to some extent, cover VIVITROL.
The Inflation Reduction Act includes several provisions that will impact our business to varying degrees, including the Drug Price Negotiation Program applicable to Medicare Parts D and B and those provisions that impose new manufacturer financial liability on all drugs in Medicare Part D beginning in 2025, and require companies to pay rebates to Medicare for drug prices that increase faster than inflation.
The Inflation Reduction Act includes several provisions that will impact our business to varying degrees, including the Drug Price Negotiation Program applicable to Medicare Parts D and B and those provisions that imposed new manufacturer financial liability on all drugs in Medicare Part D beginning in 2025, and require companies to pay rebates to Medicare for drug prices that increase faster than inflation.
Failure to comply with reporting requirements could also subject us to sanctions and/or investigations by Nasdaq or the SEC or other regulatory authorities. 49 The increasing use of social media platforms and artificial intelligence tools present new risks and challenges. Social media is increasingly being used as a means of corporate communications and for purposes of social networking and commentary.
Failure to comply with reporting requirements could also subject us to sanctions and/or investigations by Nasdaq or the SEC or other regulatory authorities. 56 The increasing use of social media platforms and artificial intelligence tools present new risks and challenges. Social media is increasingly being used as a means of corporate communications and for purposes of social networking and commentary.
Key Development Program Our R&D is focused on the development of innovative medicines in the field of neuroscience that are designed to address unmet patient needs. As part of our ongoing R&D efforts, we have devoted, and will continue to devote, significant resources to conducting preclinical work and clinical studies to advance the development of new pharmaceutical products.
Key Development Programs Our R&D is focused on the development of innovative medicines in the field of neuroscience that are designed to address unmet patient needs. As part of our ongoing R&D efforts, we have devoted, and will continue to devote, significant resources to conducting preclinical work and clinical studies to advance the development of new pharmaceutical products.
Other pharmaceutical companies are developing products for the treatment of bipolar I disorder that, if approved by the FDA, would compete with LYBALVI. 16 In the treatment of alcohol dependence, VIVITROL competes with generic acamprosate calcium (also known as CAMPRAL) and generic disulfiram (also known as ANTABUSE) as well as currently marketed drugs, including generic drugs, also formulated from naltrexone.
Other pharmaceutical companies are developing products for the treatment of bipolar I disorder that, if approved by the FDA, would compete with LYBALVI. 18 In the treatment of alcohol dependence, VIVITROL competes with generic acamprosate calcium (also known as CAMPRAL) and generic disulfiram (also known as ANTABUSE) as well as currently marketed drugs, including generic drugs, also formulated from naltrexone.
We rely on these licensees in various respects, including commercializing such products, conducting development activities with respect to new formulations or new indications for such products, and/or managing the regulatory approval process for such products. 33 We earn significant royalty revenue from sales by our licensees of our licensed products and third-party products incorporating our proprietary technologies.
We rely on these licensees in various respects, including commercializing such products, conducting development activities with respect to new formulations or new indications for such products, and/or managing the regulatory approval process for such products. 38 We earn significant royalty revenue from sales by our licensees of our licensed products and third-party products incorporating our proprietary technologies.
Negative or inaccurate posts or comments about us or our products on any social media or other public platforms could also damage our reputation, brand image and goodwill. Any of these events, if they were to occur, could cause us to incur liability, face overly restrictive regulatory actions or suffer reputational or other harm to our business. 50
Negative or inaccurate posts or comments about us or our products on any social media or other public platforms could also damage our reputation, brand image and goodwill. Any of these events, if they were to occur, could cause us to incur liability, face overly restrictive regulatory actions or suffer reputational or other harm to our business. 57
See the section entitled “ Proprietary Technology Platforms ” and “ Patents and Proprietary Rights ” in “Item 1—Business” in this Annual Report for information with respect to our proprietary technologies and the IP protection for these products. We receive royalties and/or manufacturing and other revenues from the commercialization of these products under our collaborative arrangements with these third parties.
See the sections entitled “ Proprietary Technology Platforms ” and “ Patents and Proprietary Rights ” in “Item 1—Business” in this Annual Report for information with respect to our proprietary technologies and the IP protection for these products. We receive royalties and/or manufacturing and other revenues from the commercialization of these products under our collaborative arrangements with these third parties.
We provide, and contract with third-party vendors to provide, customer services and other related programs for our products, such as product-specific websites, insurance research services and order, delivery and fulfillment services. Our sales force for VIVITROL in the U.S. consisted of approximately 105 individuals as of December 31, 2024.
We provide, and contract with third-party vendors to provide, customer services and other related programs for our products, such as product-specific websites, insurance research services and order, delivery and fulfillment services. Our sales force for VIVITROL in the U.S. consisted of approximately 105 individuals as of December 31, 2025.
In addition, our licensees may own additional patents that cover those products from which we receive royalties. 17 ARISTADA and ARISTADA INITIO We have several U.S. patents and patent applications, and a number of corresponding non-U.S. counterparts, that cover ARISTADA and/or ARISTADA INITIO. Our principal U.S. patents for ARISTADA and/or ARISTADA INITIO and their expiration dates are as follows: U.S.
In addition, our licensees may own additional patents that cover those products from which we receive royalties. 19 ARISTADA and ARISTADA INITIO We have several U.S. patents and patent applications, and a number of corresponding non-U.S. counterparts, that cover ARISTADA and/or ARISTADA INITIO. Our principal U.S. patents for ARISTADA and/or ARISTADA INITIO and their expiration dates are as follows: U.S.
If any of these facts, assumptions, representations, statements or undertakings are, or become, inaccurate or incomplete, or if we or Mural Oncology plc breach any of our respective covenants in the separation documents, the IRS Ruling and/or the U.S. Tax Opinion may be invalid and the conclusions reached therein could be jeopardized. Notwithstanding the U.S.
If any of these facts, assumptions, representations, statements or undertakings are, or become, inaccurate or incomplete, or if we or Mural breach any of our respective covenants in the separation documents, the IRS Ruling and/or the U.S. Tax Opinion may be invalid and the conclusions reached therein could be jeopardized. Notwithstanding the U.S.
Our financial and other material information is routinely posted to and accessible on the Investors section of our website, available at www.alkermes.com. Investors are encouraged to review the Investors section of our website because we may post material information on that site that is not otherwise disseminated by us. 29 Item 1 A.
Our financial and other material information is routinely posted to and accessible on the Investors section of our website, available at www.alkermes.com. Investors are encouraged to review the Investors section of our website because we may post material information on that site that is not otherwise disseminated by us. 33 Item 1 A.
We do not expect such rules to have a material effect on our business in 2025; however, such minimum tax rate rules or other similar rules could have a material adverse effect on our business, financial condition, cash flows and results of operations in future years. Our deferred tax assets may not be realized.
We do not expect such rules to have a material effect on our business in 2026; however, such minimum tax rate rules or other similar rules could have a material adverse effect on our business, financial condition, cash flows and results of operations in future years. Our deferred tax assets may not be realized.
Factors that may impact our future revenue, and in turn our future profitability, include, among others, our or our licensees’ (as applicable) ability to: • successfully commercialize VIVITROL, the ARISTADA product family, LYBALVI, VUMERITY, XEPLION, INVEGA TRINZA/TREVICTA and INVEGA HAFYERA/BYANNLI and any other marketed products from which we earn revenue in the countries in which such products are approved; • successfully develop, and obtain and maintain regulatory approval for, products in the U.S. and/or in other countries; • successfully manufacture our products and third-party products efficiently and in a cost-effective manner; • obtain adequate reimbursement coverage for our products and third-party products from insurance companies, government programs and other third-party payers; • successfully protect and defend our confidential information and IP rights related to our technologies and our products; • achieve product development or sales milestones under our collaborative arrangements; and • resolve favorably any commercial disputes that may arise in respect of collaborative arrangements from which we receive revenues.
Factors that may impact our future revenue, and in turn our future profitability, include, among others, our, our third-party contract manufacturers or our licensees’ (as applicable) ability to: • successfully commercialize VIVITROL, the ARISTADA product family, LYBALVI, LUMRYZ, VUMERITY, XEPLION, INVEGA TRINZA/TREVICTA and INVEGA HAFYERA/BYANNLI and any other marketed products from which we earn revenue in the countries in which such products are approved; • successfully develop, and obtain and maintain regulatory approval for, products in the U.S. and/or in other countries; • successfully manufacture our products and third-party products efficiently and in a cost-effective manner; • obtain adequate reimbursement coverage for our products and third-party products from insurance companies, government programs and other third-party payers; • successfully protect and defend our confidential information and IP rights related to our technologies and our products; • maintain regulatory exclusivities or the benefits of such exclusivities; • achieve product development or sales milestones under our collaborative arrangements; and • resolve favorably any commercial disputes that may arise in respect of collaborative arrangements from which we receive revenues.
Unexpected refunds to the government, and responding to a government investigation or enforcement action, would be expensive and time-consuming, and could have a material adverse effect on our business, financial condition, results of operations and growth prospects. 42 Our business involves environmental, health and safety risks.
Unexpected refunds to the government, and responding to a government investigation or enforcement action, would be expensive and time-consuming, and could have a material adverse effect on our business, financial condition, results of operations and growth prospects. 48 Our business involves environmental, health and safety risks.
LYBALVI is a combination of olanzapine, an atypical antipsychotic, and samidorphan, an opioid antagonist, in a single bilayer tablet. LYBALVI is available in fixed dosage strengths composed of 10 mg of samidorphan and 5 mg, 10 mg, 15 mg or 20 mg of olanzapine. We exclusively manufacture and commercialize LYBALVI in the U.S. In January 2025, U.S.
LYBALVI is a combination of olanzapine, an atypical antipsychotic, and samidorphan, an opioid antagonist, in a single bilayer tablet. LYBALVI is available in fixed dosage strengths composed of 10 mg of samidorphan and 5 mg, 10 mg, 15 mg or 20 mg of olanzapine. We exclusively manufacture and commercialize LYBALVI in the U.S.
With respect to our products, we believe that our ability to successfully compete will depend on, among other things, the existence of competing or alternative products in the marketplace, including generic competition, and the relative price of those products; the efficacy, safety and reliability of our products compared to competing or alternative products; product acceptance by, and preferences of, physicians, other healthcare providers and patients; our ability to comply with applicable laws, regulations and regulatory requirements with respect to the manufacture and/or commercialization of our products, including any changes or increases to regulatory restrictions; protection of our proprietary rights relating to our products; our ability to obtain reimbursement for our products; our ability to complete clinical development and obtain regulatory approvals for our products, and the timing and scope of any such regulatory approvals; our ability to successfully manufacture and provide a reliable supply of commercial quantities of a product to the market; and our ability to recruit, retain and develop skilled employees.
With respect to our products, we believe that our ability to successfully compete will depend on, among other things, the existence of competing or alternative products in the marketplace, including generic competition, and the relative price of those products; the efficacy, safety and reliability of our products compared to competing or alternative products; product acceptance by, and preferences of, physicians, other healthcare providers and patients; our ability to comply with applicable laws, regulations and regulatory requirements with respect to the manufacture and/or commercialization of our products, including any imposed REMS program or any other changes or increases to regulatory restrictions; protection of our proprietary rights relating to our products; our ability to obtain reimbursement for our products; our ability to complete clinical development and obtain regulatory approvals for our products, and the timing and scope of any such regulatory approvals; our, or our contract manufacturers’, ability to successfully manufacture and provide a reliable supply of commercial quantities of a product to the market; and our ability to recruit, retain and develop skilled employees.
Tax Opinion were based on and relied on, among other things, certain facts, assumptions, representations, and undertakings from us and Mural Oncology plc, including those relating to past and future conduct of the companies’ respective business operations and other matters.
Tax Opinion were based on and relied on, among other things, certain facts, assumptions, representations, and undertakings from us and Mural, including those relating to past and future conduct of the companies’ respective business operations and other matters.
In 2024, employee health, safety and wellness continued to be of particular focus and importance for the Company. 28 Available Information and Website Disclosure Our principal executive offices are located at Connaught House, 1 Burlington Road, Dublin 4, Ireland D04 C5Y6. Our telephone number is +353-1-772-8000 and our website address is www.alkermes.com .
In 2025, employee health, safety and wellness continued to be of particular focus and importance for the Company. Available Information and Website Disclosure Our principal executive offices are located at Connaught House, 1 Burlington Road, Dublin 4, Ireland D04 C5Y6. Our telephone number is +353-1-772-8000 and our website address is www.alkermes.com .
We have collaborated with our employees to create five employee resource groups, or ERGs: Limitless, a network to support people impacted by disability or illness; MOSAIC, a multicultural network; Operation Salute, a network to support active duty military members, veterans and their families; Pride@Work, an LGBTQ+ and allies network; and Women Inspired Network (WIN), a women’s network.
In recent years, we have collaborated with our employees to create five employee resource groups, or ERGs: Limitless, a network to support people impacted by disability or illness; MOSAIC, a multicultural network; Operation Salute, a network to support active duty military members, veterans and their families; Pride@Work, an LGBTQ+ and allies network; and Women Inspired Network (WIN), a women’s network.
We survey employees at least annually, which allows our employees to share their insights on a regular basis and provides us with opportunities to regularly assess and address employee feedback. As many of our office-based employees have adapted to a hybrid work model, we have continued to implement our expanded employee communications strategies to keep all employees connected and informed.
We survey employees at least annually, which allows our employees to share their insights on a regular basis and provides us with opportunities to regularly assess and address employee feedback. As many of our office-based employees have adapted to a hybrid work model, we have continued to utilize expanded employee communications strategies to keep our employees connected and informed.
At December 31, 2024, our accumulated deficit was $1.0 billion, which was primarily the result of net losses incurred from continuing operations from 1987, the year Alkermes, Inc. was founded, through December 31, 2022, partially offset by net income from continuing operations over certain fiscal periods, including net income earned during the years ended December 31, 2024 and December 31, 2023.
At December 31, 2025, our accumulated deficit was $0.7 billion, which was primarily the result of net losses incurred from continuing operations from 1987, the year Alkermes, Inc. was founded, through December 31, 2022, partially offset by net income from continuing operations over certain fiscal periods, including net income earned during the years ended December 31, 2025, 2024 and 2023.
Competition for such personnel in our industry and the geographic regions in which we operate is intense, with numerous companies also developing, launching or marketing products, including products against which our products directly compete.
Competition for such personnel in our industry and the geographic regions in which we operate is intense, with numerous companies also developing, manufacturing or marketing products, including products against which our products directly compete.
Disruptions at the FDA and other regulatory agencies that are unrelated to our company or our products, including due to changes in government, could increase the time required for new drugs to be reviewed and approved, or otherwise cause delays to the regulatory approval or post-approval processes for our products, which could adversely affect our business.
Disruptions at the FDA and other regulatory agencies that are unrelated to our company or our products, including due to changes in government or significant changes in leadership or personnel, could increase the time required for new drugs to be reviewed and approved, or otherwise cause delays to the regulatory approval or post-approval processes for our products, which could adversely affect our business.
In addition, our employees may knowingly or inadvertently engage on social media and with AI in ways that may not comply with our social media policy or guidelines with respect to AI or other legal, contractual or regulatory requirements.
In addition, our employees may knowingly or inadvertently engage on social media and with AI in ways that may not comply with our social media or AI policies or guidelines with respect to AI or other legal, contractual or regulatory requirements.
Regulatory approval by the FDA or other regulatory agencies can be delayed, limited or not granted at all for many reasons, including: • a product may not demonstrate sufficient safety and efficacy or a sufficiently favorable benefit/risk profile for each target indication in accordance with applicable regulatory agencies’ standards; • data from preclinical testing and clinical trials may be interpreted by applicable regulatory agencies in different ways than we or our licensees interpret it; 35 • regulatory agencies may not agree with our or our licensees’ regulatory approval strategies, plans for accelerated development timelines, components of our or our licensees’ filings such as clinical trial designs, conduct and methodologies, or the sufficiency of our or our licensees’ submitted data to meet their requirements for product approval; • regulatory agencies might not approve our or our licensees’ manufacturing processes or facilities, or those of the CROs and contract manufacturing organizations who conduct research or manufacturing work on our or our licensees’ behalf; • failure by our clinical investigational sites and the records kept at such sites, including any clinical trial data, to be in compliance with the FDA’s GCP, or EU legislation governing GCP, or to pass FDA, EMA or EU member state inspections of clinical trials; • regulatory agencies may change their requirements for approval or post-approval marketing; and • adverse medical events during our clinical trials or during clinical trials of other product candidates in the same class could lead to requirements that trials be repeated or extended, or that a development program be terminated or placed on clinical hold, even if other studies or trials relating to the program are successful.
Regulatory approval by the FDA or other regulatory agencies can be delayed, limited or not granted at all for many reasons, including: • a product may not demonstrate sufficient safety and efficacy or a sufficiently favorable benefit/risk profile for each target indication in accordance with applicable regulatory agencies’ standards; • data from preclinical testing and clinical trials may be interpreted by applicable regulatory agencies in different ways than we or our licensees interpret it; • regulatory agencies may not agree with our or our licensees’ regulatory approval strategies, plans for accelerated development timelines, components of our or our licensees’ filings such as clinical trial designs, conduct and 40 methodologies, or the sufficiency of our or our licensees’ submitted data to meet their requirements for product approval; • regulatory agencies might not approve our or our licensees’ manufacturing processes or facilities, or those of the CROs and third-party contract manufacturers who conduct research or manufacturing work on our or our licensees’ behalf; • failure by our clinical investigational sites and the records kept at such sites, including any clinical trial data, to be in compliance with the FDA’s GCP, or EU legislation governing GCP, or to pass FDA, EMA or EU member state inspections of clinical trials; • regulatory agencies may change their requirements for approval or post-approval marketing, including potential imposition or modification of a REMS; and • adverse medical events during our clinical trials or during clinical trials of other product candidates in the same class could lead to requirements that trials be repeated or extended, or that a development program be terminated or placed on clinical hold, even if other studies or trials relating to the program are successful.
We have a portfolio of proprietary commercial products for the treatment of alcohol dependence, opioid dependence, schizophrenia and bipolar I disorder, and a pipeline of clinical and preclinical candidates in development for neurological disorders, including narcolepsy and idiopathic hypersomnia. Headquartered in Ireland, we also have a corporate office and R&D center in Massachusetts and a manufacturing facility in Ohio.
We have a portfolio of proprietary commercial products for the treatment of alcohol dependence, opioid dependence, schizophrenia, bipolar I disorder and narcolepsy, and a pipeline of clinical and preclinical candidates in development for neurological disorders. Headquartered in Ireland, we also have a corporate office and R&D center in Massachusetts and a manufacturing facility in Ohio.
We rely on third parties for the timely supply of goods and services that play a role in our manufacturing activities, including, among others, specified raw materials, equipment, contract manufacturing, formulation and packaging services, storage and product distribution services, customer service activities and product returns processing, and some of these goods and services for our products are currently only available from a single source or a limited number of qualified sources.
We rely on third parties for the timely supply of goods and services that play a role in the manufacture and distribution of our products, including, among others, specified raw materials, equipment, contract manufacturing, formulation and packaging services, operation of the LUMRYZ REMS, storage and product distribution services, customer service activities and product returns processing, and some of these goods and services for our products are currently only available from a single source or a limited number of qualified sources.
In May 2024, we completed the sale of our Athlone Facility and related business to Novo Nordisk (“Novo”) and entered into subcontracting arrangements to continue certain development and manufacturing activities performed at the Athlone Facility for a period of time after the closing of the transaction, which may continue through the end of 2025.
In May 2024, we completed the sale of our Athlone Facility and related business to Novo Nordisk (“Novo”) and entered into subcontracting arrangements to continue certain development and manufacturing activities performed at the Athlone Facility for a period of time after the closing of the transaction, which concluded by the end of 2025.
In May 2024, our shareholders renewed our board of directors’ general authority to allot and issue ordinary shares in an amount equal to approximately 20% of our issued ordinary share capital (as of April 10, 2024), and to issue ordinary shares for cash on a non-pre-emptive basis in an amount equal to approximately 20% of our issued share capital (as of April 10, 2024); however, these share issuance authorities were granted for eighteen months only, at which point they will lapse unless renewed by our shareholders.
In May 2025, our shareholders renewed our board of directors’ general authority to allot and issue ordinary shares in an amount equal to approximately 20% of our issued ordinary share capital (as of April 1, 2025), and to issue ordinary shares for cash on a non-pre-emptive basis in an amount equal to approximately 20% of our issued share capital (as of April 1, 2025); however, these share issuance authorities were granted for eighteen months only, at which point they will lapse unless renewed by our shareholders.
We seek to attract, hire, develop, recognize and retain qualified and highly skilled employees with experience in areas such as R&D, including early discovery, medicinal chemistry, translational medicine, formulation development, and clinical trials operations capabilities; IP prosecution, enforcement and defense; medical affairs; manufacturing operations; U.S. federal and state government affairs; sales and marketing; and market access, among other areas.
We seek to attract, hire, develop, retain and motivate qualified and highly-skilled employees with experience in areas such as R&D, including early discovery, medicinal chemistry, translational medicine, formulation development, and clinical trials operations capabilities; IP prosecution, enforcement and defense; medical affairs; manufacturing operations; U.S. federal and state government affairs; sales and marketing; and market access, among others.
Opioid dependence is a serious and chronic brain disease characterized by compulsive, prolonged self-administration of opioid substances that are not used for a medical purpose. According to the 2023 U.S. National Survey on Drug Use and Health, an estimated 5.4 million people aged 18 or older in the U.S. had an opioid use disorder* in the prior year.
Opioid dependence is a serious and chronic brain disease characterized by compulsive, prolonged self-administration of opioid substances that are not used for a medical purpose. According to the 2024 U.S. National Survey on Drug Use and Health, an estimated 4.6 million people aged 18 or older in the U.S. had an opioid use disorder* in the prior year.
Alcohol dependence is a serious and chronic brain disease characterized by cravings for alcohol, loss of control over drinking, withdrawal symptoms and an increased tolerance for alcohol. According to the 2023 U.S. National Survey on Drug Use and Health, an estimated 28.1 million people aged 18 or older in the U.S. had an alcohol use disorder* in the prior year.
Alcohol dependence is a serious and chronic brain disease characterized by cravings for alcohol, loss of control over drinking, withdrawal symptoms and an increased tolerance for alcohol. According to the 2024 U.S. National Survey on Drug Use and Health, an estimated 27.1 million people aged 18 or older in the U.S. had an alcohol use disorder* in the prior year.
In May 2024, we completed the sale of our research and development business and manufacturing facility in Athlone, Ireland (the “Athlone Facility”) where VUMERITY is manufactured.
In May 2024, we completed the sale of our research and development business and manufacturing facility in Athlone, Ireland (the “Athlone Facility”) where VUMERITY was manufactured.
There is a risk that the use of social media and AI by us or our employees to communicate about our products or business or for other business purposes may cause us to be found in violation of applicable requirements and could result in regulatory actions or legal claims against us related to off-label marketing or other prohibited activities.
There is a risk that we or our employees may use social media and AI to communicate about our products or business or for other business purposes that may cause us to be found in violation of applicable requirements and could result in regulatory actions or legal claims against us, including claims related to off-label marketing or other prohibited activities.
For example, and as discussed above, the Inflation Reduction Act includes several provisions that will impact our business to varying degrees, including those that impose new manufacturer financial liability on all drugs in Medicare Part D beginning in 2025, allow the U.S. government to negotiate prices for some drugs covered under Medicare Part B and Part D with effect beginning in 2026, and require companies to pay rebates to Medicare for drug prices that increase faster than inflation.
For example, and as discussed above, the Inflation Reduction Act includes several provisions that will impact our business to varying degrees, including those that imposed new manufacturer financial liability on all drugs in Medicare Part D beginning in 2025, allow the U.S. government to negotiate prices for some drugs covered under Medicare Part B and Part D, and require companies to pay rebates to Medicare for drug prices that increase faster than inflation.
For example, Teva entities filed an ANDA seeking approval to engage in the commercial manufacture, use or sale of a generic version of VIVITROL and alleged that one of our Orange-Book patents related to VIVITROL is invalid, unenforceable and/or will not be infringed by Teva’s proposed product.
For example, Teva entities filed an ANDA seeking approval to engage in the commercial manufacture, use or sale of a generic version of VIVITROL and alleged that one of our Orange-Book patents related to VIVITROL was invalid, unenforceable and/or would not be infringed by Teva’s proposed product.
(together with Janssen Pharmaceuticals, Inc., Janssen International and their affiliates “Janssen”) Worldwide INVEGA TRINZA / TREVICTA Schizophrenia Janssen Worldwide INVEGA HAFYERA / BYANNLI Schizophrenia Janssen Worldwide Our Key Licensed Product Product Indication(s) Licensee Licensed Territory VUMERITY Multiple sclerosis Biogen Worldwide Proprietary Products We have developed and now commercialize products designed to help address the unmet needs of people living with opioid dependence, alcohol dependence, schizophrenia and bipolar I disorder.
(together with Janssen Pharmaceuticals, Inc., Janssen International and their affiliates “Janssen”) Worldwide INVEGA TRINZA / TREVICTA Schizophrenia Janssen Worldwide INVEGA HAFYERA / BYANNLI Schizophrenia Janssen Worldwide Our Key Licensed Product Product Indicated Disease State Licensee Licensed Territory VUMERITY Multiple sclerosis Biogen Worldwide Proprietary Products We have developed and now commercialize products designed to help address the unmet needs of people living with opioid dependence, alcohol dependence, schizophrenia and bipolar I disorder.
We are, and may in the future become, involved in various legal proceedings, including those asserting violations of securities and/or fraud and abuse laws and those asserting claims related to product liability, IP and/or contractual arrangements.
We are, and may in the future become, involved in various legal proceedings, including those asserting violations of securities and/or fraud and abuse laws and those asserting claims related to product liability, class actions or antitrust claims, IP and/or contractual arrangements.
Alcohol dependence; Opioid dependence U.S. 7 The following provides summary information regarding certain key third-party products using our proprietary technologies under license and our key licensed product, that are commercialized by our licensees: Key Third-Party Products Using Our Proprietary Technologies Product Indication(s) Licensee Licensed Territory RISPERDAL CONSTA Schizophrenia; Bipolar I disorder Janssen Pharmaceuticals, Inc. and Janssen Pharmaceutica International, a division of Cilag International AG (“Janssen International”) Worldwide INVEGA SUSTENNA / XEPLION INVEGA SUSTENNA : Schizophrenia; Schizoaffective disorder XEPLION : Schizophrenia Janssen Pharmaceutica N.V.
Alcohol dependence; Opioid dependence U.S. 8 The following provides summary information regarding certain key third-party products using our proprietary technologies under license and our key licensed product, that are commercialized by our licensees: Key Third-Party Products Using Our Proprietary Technologies Product Indicated Disease State Licensee Licensed Territory RISPERDAL CONSTA Schizophrenia; Bipolar I disorder Janssen Pharmaceuticals, Inc. and Janssen Pharmaceutica International, a division of Cilag International AG (“Janssen International”) Worldwide INVEGA SUSTENNA / XEPLION INVEGA SUSTENNA : Schizophrenia; Schizoaffective disorder XEPLION : Schizophrenia Janssen Pharmaceutica N.V.
In October 2019, we entered into a commercial supply agreement with Biogen for the commercial supply of VUMERITY, an amendment to such commercial supply agreement and an amendment to the license and collaboration agreement with Biogen, pursuant to which Biogen has conducted a technology transfer and, following an agreed manufacturing transition period, has elected to assume responsibility for the manufacture (itself or through a designee) of clinical and commercial supplies of VUMERITY in exchange for an increase in the royalty rate to be paid by Biogen to us on net sales of product that is manufactured by Biogen or its designee.
In October 2019, we entered into a commercial supply agreement with Biogen for the commercial supply of VUMERITY, an amendment to such commercial supply agreement and an amendment to the license and collaboration agreement with Biogen, pursuant to which Biogen has, following a completed technology transfer and an agreed manufacturing transition period, assumed all responsibility for the manufacture (itself or through a designee) of clinical and commercial supplies of VUMERITY in exchange for an increase in the royalty rate to be paid by Biogen to us on net sales of product that is manufactured by Biogen or its designee.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe serve as the guarantor of a lease assigned to Mural Oncology, Inc., a subsidiary of Mural Oncology plc, for a facility in Waltham, Massachusetts with approximately 180,000 square feet of corporate offices, administrative areas and laboratories. This lease expires in 2026 and includes a tenant option to extend the term for an additional five-year period.
Biggest changeIn December 2025, we entered into a lease agreement for an approximately 6,675 square foot corporate office space in Athlone, Ireland. The initial term of the lease commenced on January 1, 2026, expires on December 31, 2030 and includes an option to extend for an additional five-year period.
Item 2. P roperties We lease an approximately 14,600 square foot corporate office space in Dublin, Ireland, which is our corporate headquarters. This lease expires in 2027 and does not include an additional tenant option to further extend the term. We lease an approximately 231,000 square foot corporate office and R&D center in Waltham, Massachusetts.
Item 2. P roperties We lease an approximately 14,600 square foot corporate office space in Dublin, Ireland, which is our corporate headquarters. This lease expires in January 2027 and does not include an additional tenant option to further extend the term.
We lease an approximately 7,000 square foot corporate office and administrative space in Washington, DC. This lease expires in 2029 and includes a tenant option to extend the term for an additional five-year period. We own an approximately 375,000 square foot manufacturing facility in Wilmington, Ohio.
This lease expires in 2029 and includes a tenant option to extend the term for an additional five-year period. We lease an approximately 17,065 square foot corporate office and administrative space in Chesterfield, Missouri. This lease expires in 2029 and includes a tenant option to extend the term for an additional three-year period.
We believe that our current facilities are suitable and adequate for our current and near-term preclinical, clinical and commercial requirements.
We own an approximately 375,000 square foot manufacturing facility in Wilmington, Ohio. We believe that our current facilities are suitable and adequate for our current and near-term preclinical, clinical and commercial requirements.
This lease, which commenced in January 2020, expires in 2035 and includes a tenant option to extend the term for an additional ten-year period.
We lease an approximately 231,000 square foot corporate office and R&D center in Waltham, Massachusetts. This lease, which commenced in January 2020, expires in 2035 and includes a tenant option to extend the term for an additional ten-year period. We lease an approximately 7,000 square foot corporate office and administrative space in Washington, DC.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings For information regarding legal proceedings, refer to the discussion under the heading “Litigation” in Note 19, Commitments and Contingent Liabilities in the “Notes to Consolidated Financial Statements” in this Annual Report, which discussion is incorporated, in relevant part, into this Item 3 by reference. Item 4. Mine Saf ety Disclosures Not Applicable. 52 PART II
Biggest changeItem 3. Legal Proceedings For information regarding legal proceedings, refer to the discussion under the heading “Litigation” in Note 19, Commitments and Contingent Liabilities in the “Notes to Consolidated Financial Statements” in this Annual Report, which discussion is incorporated, in relevant part, into this Item 3 by reference. Item 4. Mine Saf ety Disclosures Not Applicable. 59 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeIn order for the share registrar to be satisfied as to the application of this Irish stamp duty treatment where relevant, the shareholder must confirm to us that the shareholder would be the beneficial owner of the related book-entry interest in those ordinary shares recorded in the systems of DTC, and in exactly the same proportions or vice-versa, as a result of the transfer and there is no agreement for the sale of the related book-entry interest or the ordinary shares or an interest in the ordinary shares, as the case may be, by the shareholder to a third party being contemplated.
Biggest changeSimilarly, a shareholder who holds ordinary shares through DTC may transfer those ordinary shares out of DTC without giving rise to Irish stamp duty provided that the shareholder would be the beneficial owner of the ordinary shares, and in exactly the same proportions, as a result of the transfer, and at the time of the transfer out of DTC there is no sale of those ordinary shares to a third party being contemplated by the shareholder. 61 In order for the share registrar to be satisfied as to the application of this Irish stamp duty treatment where relevant, the shareholder must confirm to us that the shareholder would be the beneficial owner of the related book-entry interest in those ordinary shares recorded in the systems of DTC, and in exactly the same proportions or vice-versa, as a result of the transfer and there is no agreement for the sale of the related book-entry interest or the ordinary shares or an interest in the ordinary shares, as the case may be, by the shareholder to a third party being contemplated.
Legislative, administrative or judicial changes may modify the tax consequences described below. 53 The statements do not constitute tax advice and are intended only as a general guide.
Legislative, administrative or judicial changes may modify the tax consequences described below. The statements do not constitute tax advice and are intended only as a general guide.
However, a shareholder who is neither resident nor ordinarily resident in Ireland and who is entitled to an exemption from DWT, generally has no liability for Irish income tax or to the universal social charge on a dividend from us, unless they holds their ordinary shares through a branch or agency in Ireland which carries out a trade on their behalf.
However, a shareholder who is neither resident nor ordinarily resident in Ireland and who is entitled to an exemption from DWT, generally has no liability for Irish income tax or to the universal social charge on a dividend from us, unless they hold their ordinary shares through a branch or agency in Ireland which carries out a trade on their behalf.
The comparison assumes $100 was invested on December 31, 2019 in our ordinary shares and in each of the foregoing indices and further assumes reinvestment of any dividends. We did not declare or pay any dividends on our ordinary shares during the comparison period.
The comparison assumes $100 was invested on December 31, 2020 in our ordinary shares and in each of the foregoing indices and further assumes reinvestment of any dividends. We did not declare or pay any dividends on our ordinary shares during the comparison period.
As of December 31, 2024, the remaining amount authorized under the Repurchase Program was $200.0 million, exclusive of any fees, commissions or other related expenses.
As of December 31, 2025, the remaining amount authorized under the Repurchase Program was $200.0 million, exclusive of any fees, commissions or other related expenses.
Irish taxes applicable to U.S. holders The following is a general summary of the main Irish tax considerations applicable to the purchase, ownership and disposition of our ordinary shares by U.S. holders. It is based on existing Irish law and practices in effect on January 6, 2025, and on discussions and correspondence with the Irish Revenue Commissioners.
Irish taxes applicable to U.S. holders The following is a general summary of the main Irish tax considerations applicable to the purchase, ownership and disposition of our ordinary shares by U.S. holders. It is based on existing Irish law and practices in effect on January 15, 2026, and on discussions and correspondence with the Irish Revenue Commissioners.
Item 5. Market for Registrant’s Common Equity, Related Sto ckholder Matters and Issuer Purchases of Equity Securities Market and shareholder information Our ordinary shares are traded on the Nasdaq Global Select Market under the symbol “ALKS.” There were 87 shareholders of record of our ordinary shares on February 7, 2025.
Item 5. Market for Registrant’s Common Equity, Related Sto ckholder Matters and Issuer Purchases of Equity Securities Market and shareholder information Our ordinary shares are traded on the Nasdaq Global Select Market under the symbol “ALKS.” There were 79 shareholders of record of our ordinary shares on February 20, 2026.
The following graph compares the cumulative total shareholder return on our ordinary shares from December 31, 2019 through December 31, 2024 with the cumulative returns of the Nasdaq Composite Total Return Index and the Nasdaq Biotechnology Index.
The following graph compares the cumulative total shareholder return on our ordinary shares from December 31, 2020 through December 31, 2025 with the cumulative returns of the Nasdaq Composite Total Return Index and the Nasdaq Biotechnology Index.
The following table sets forth our share repurchase activity for the three months ended December 31, 2024: Period Total Number of Ordinary Shares Purchased (a) (1) Average Price Paid per Ordinary Share (b) Total Number of Ordinary Shares Purchased as Part of Publicly Announced Program (c) (2) Approximate Dollar Value (in millions) of Ordinary Shares that May Yet Be Purchased Under the Program (d) (2) October 1, 2024 – October 31, 2024 4,686 28.74 — $ 200.0 November 1, 2024 – November 30, 2024 3,727 27.41 — $ 200.0 December 1, 2024 – December 31, 2024 3,413 31.43 — $ 200.0 Totals 11,826 $ 29.10 — (1) Consists of ordinary shares acquired during the three months ended December 31, 2024 to satisfy tax withholding obligations related to the vesting of equity awards.
The following table sets forth our share repurchase activity for the three months ended December 31, 2025: Period Total Number of Ordinary Shares Purchased (a) (1) Average Price Paid per Ordinary Share (b) Total Number of Ordinary Shares Purchased as Part of Publicly Announced Program (c) (2) Approximate Dollar Value (in millions) of Ordinary Shares that May Yet Be Purchased Under the Program (d) (2) October 1, 2025 – October 31, 2025 3,902 31.11 — $ 200.0 November 1, 2025 – November 30, 2025 3,046 31.60 — $ 200.0 December 1, 2025 – December 31, 2025 1,611 29.43 — $ 200.0 Totals 8,559 $ 30.97 — (1) Consists of ordinary shares acquired during the three months ended December 31, 2025 to satisfy tax withholding obligations related to the vesting of equity awards.
The Repurchase Program has no set expiration date and may be suspended or discontinued at any time.
The Repurchase Program has no set expiration date and may be suspended or discontinued at any time. During the year ended December 31, 2025, we did not repurchase any ordinary shares under the Repurchase Program.
Withholding tax on dividends While we have no current plans to pay dividends, dividends on our ordinary shares would generally be subject to Irish dividend withholding tax (“DWT”) at 25%, unless an exemption applies.
This summary is not exhaustive and shareholders should consult their own tax advisers as to the tax consequences in Ireland, or other relevant jurisdictions where we operate, including the acquisition, ownership and disposition of ordinary shares. 60 Withholding tax on dividends While we have no current plans to pay dividends, dividends on our ordinary shares would generally be subject to Irish dividend withholding tax (“DWT”) at 25%, unless an exemption applies.
The statements are in reference to individuals who are considered non-resident and non-ordinarily resident of Ireland for tax purposes. This summary is not exhaustive and shareholders should consult their own tax advisers as to the tax consequences in Ireland, or other relevant jurisdictions where we operate, including the acquisition, ownership and disposition of ordinary shares.
The statements are in reference to individuals who are considered non-resident and non-ordinarily resident of Ireland for tax purposes.
Year Ended December 31, 2019 2020 2021 2022 2023 2024 Alkermes 100 98 114 128 136 141 Nasdaq Composite Total Return 100 145 177 119 173 224 Nasdaq Biotechnology Index 100 126 126 114 119 118 Item 6. [Reserved] Not applicable. 55
Year Ended December 31, 2020 2021 2022 2023 2024 2025 Alkermes 100 117 131 141 147 143 Nasdaq Composite Total Return 100 122 82 119 154 187 Nasdaq Biotechnology Index 100 100 90 94 93 125
Removed
Similarly, a shareholder who 54 holds ordinary shares through DTC may transfer those ordinary shares out of DTC without giving rise to Irish stamp duty provided that the shareholder would be the beneficial owner of the ordinary shares, and in exactly the same proportions, as a result of the transfer, and at the time of the transfer out of DTC there is no sale of those ordinary shares to a third party being contemplated by the shareholder.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeA rollforward of our provisions for sales and allowances is as follows: (In millions) Contractual Adjustments (1) Discounts (2) Product Returns Other Total Balance, December 31, 2022 $ 226.7 $ 26.2 $ 29.7 $ 7.9 $ 290.5 Provision: Current year 509.7 326.9 33.4 71.5 941.5 Prior year (8.8 ) — 2.8 — (6.0 ) Total 500.9 326.9 36.2 71.5 935.5 Payments and credits related to: Current year sales (308.4 ) (293.8 ) — (56.2 ) (658.4 ) Prior year sales (184.8 ) (30.6 ) (24.8 ) (13.0 ) (253.2 ) Total (493.2 ) (324.4 ) (24.8 ) (69.2 ) (911.6 ) Balance, December 31, 2023 $ 234.4 $ 28.7 $ 41.1 $ 10.2 $ 314.4 Provision: Current year 557.7 386.6 28.6 87.4 1,060.3 Prior year (20.6 ) — (3.7 ) — (24.3 ) Total 537.1 386.6 24.9 87.4 1,036.0 Payments and credits related to: Current year sales (369.9 ) (353.6 ) — (70.8 ) (794.3 ) Prior year sales (172.6 ) (18.1 ) (15.5 ) (13.5 ) (219.7 ) Total (542.5 ) (371.7 ) (15.5 ) (84.3 ) (1,014.0 ) Balance, December 31, 2024 $ 229.0 $ 43.6 $ 50.5 $ 13.3 $ 336.4 (1) “Contractual Adjustments” include “Medicaid Rebates” and “Medicare Part D” accruals (2) “Discounts” include “Chargebacks” and “Product Discounts” Manufacturing Revenue We recognize manufacturing revenues from the sale of products we manufacture for resale by our licensees.
Biggest changeActual Medicare Part D rebates have not differed materially from our estimates. 71 A rollforward of our provisions for sales and allowances is as follows: (In millions) Contractual Adjustments (1) Discounts (2) Product Returns Other Total Balance, December 31, 2023 $ 234.4 $ 28.7 $ 41.1 $ 10.2 $ 314.4 Provision: Current year 557.7 386.6 28.6 87.4 1,060.3 Prior year (20.6 ) — (3.7 ) — (24.3 ) Total 537.1 386.6 24.9 87.4 1,036.0 Payments and credits related to: Current year sales (369.9 ) (353.6 ) — (70.8 ) (794.3 ) Prior year sales (172.6 ) (18.1 ) (15.5 ) (13.5 ) (219.7 ) Total (542.5 ) (371.7 ) (15.5 ) (84.3 ) (1,014.0 ) Balance, December 31, 2024 $ 229.0 $ 43.6 $ 50.5 $ 13.3 $ 336.4 Provision: Current year 544.5 420.4 29.9 89.1 1,083.9 Prior year (43.3 ) 0.2 (12.6 ) (0.4 ) (56.1 ) Total 501.2 420.6 17.3 88.7 1,027.8 Payments and credits related to: Current year sales (392.8 ) (398.9 ) — (80.1 ) (871.8 ) Prior year sales (127.5 ) (23.9 ) (12.4 ) (12.6 ) (176.4 ) Total (520.3 ) (422.8 ) (12.4 ) (92.7 ) (1,048.2 ) Balance, December 31, 2025 $ 209.9 $ 41.4 $ 55.4 $ 9.3 $ 316.0 (1) “Contractual Adjustments” include “Medicaid Rebates” and “Medicare Part D” accruals (2) “Discounts” include “Chargebacks” and “Product Discounts” Manufacturing Revenue We recognize manufacturing revenues from the sale of products we manufacture for resale by our licensees.
For information related to risks surrounding our deferred tax assets, see “Item 1A—Risk Factors” in this Annual Report and specifically the section entitled “Our deferred tax assets may not be realized.” Recent Accounting Pronouncements See Note 2, Summary of Significant Accounting Policies , “New Accounting Pronouncements” in our “Notes to Consolidated Financial Statements” in this Annual Report for discussion, if any, of new accounting standards.
For information related to risks surrounding our deferred tax assets, see “Item 1A—Risk Factors” in this Annual Report and specifically the section entitled “Our deferred tax assets may not be realized.” 73 Recent Accounting Pronouncements See Note 2, Summary of Significant Accounting Policies , “New Accounting Pronouncements” in our “Notes to Consolidated Financial Statements” in this Annual Report for discussion, if any, of new accounting standards.
We have reviewed these critical accounting estimates and related disclosures with the audit and risk committee of our board of directors. Revenue from Contracts with Customers We recognize revenue when our customer obtains control of promised goods or services, in an amount that reflects the consideration which we expect to receive in exchange for those goods or services.
We have reviewed these critical accounting estimates and related disclosures with the audit and risk committee of our board of directors. 70 Revenue from Contracts with Customers We recognize revenue when our customer obtains control of promised goods or services, in an amount that reflects the consideration which we expect to receive in exchange for those goods or services.
Operating cash flow is derived by adjusting our net income (loss) for non-cash operating items such as depreciation, amortization and share-based compensation and changes in operating assets and liabilities, which reflect timing differences between the receipt and payment of cash associated with transactions and when they are recognized in our results of operations.
Operating cash flow is derived by adjusting our net income for non-cash operating items such as depreciation, amortization and share-based compensation and changes in operating assets and liabilities, which reflect timing differences between the receipt and payment of cash associated with transactions and when they are recognized in our results of operations.
To date, actual chargebacks have not differed materially from our estimates; 63 • Product Discounts —cash consideration, including sales incentives, given by us under agreements with a number of wholesaler, distributor, pharmacy, and treatment provider customers that provide them with a discount on the purchase price of products.
To date, actual chargebacks have not differed materially from our estimates; • Product Discounts —cash consideration, including sales incentives, given by us under agreements with a number of wholesaler, distributor, pharmacy, and treatment provider customers that provide them with a discount on the purchase price of products.
Investing Activities Cash flows used in investing activities during 2024 primarily consisted of $176.2 million in net purchases of investments and the purchase of $33.5 million of property, plant and equipment. These outflows were offset by proceeds from the sale of the Athlone Facility and related business of $97.9 million.
Cash flows used in investing activities during 2024 primarily consisted of $176.2 million in net purchases of investments and the purchase of $33.5 million of property, plant and equipment. These outflows were partially offset by proceeds from the sale of the Athlone Facility and related business of $97.9 million.
For additional discussion of our agreements with Janssen related to the long-acting INVEGA products, including the royalty provisions set forth therein and the related arbitration proceedings and outcome, see the section entitled “ Collaborative Arrangements — Janssen ” in “Item 1—Business” in this Annual Report.
For additional discussion of our agreements with Janssen related to the long-acting INVEGA products, including the royalty provisions set forth therein and the related completed arbitration proceedings and outcome, see the section entitled “ Collaborative Arrangements — Janssen ” in “Item 1—Business” in this Annual Report.
Accordingly, the accompanying consolidated financial statements for all periods have been updated to present the assets and liabilities associated with the oncology business separately as discontinued operations on the consolidated balance sheet and the results of such discontinued operations reported as a separate component of income in the consolidated statements of operations and comprehensive income (loss).
Accordingly, the accompanying consolidated financial statements for all periods have been updated to present the assets and liabilities associated with the oncology business separately as discontinued operations on the consolidated balance sheet and the results of such discontinued operations reported as a separate component of income in the consolidated statements of operations and comprehensive income.
A number of companies currently market and/or are developing products to treat schizophrenia and/or bipolar I disorder that may compete with and negatively impact future sales of ARISTADA, ARISTADA INITIO and LYBALVI. Increased competition may lead to reduced unit sales of ARISTADA, ARISTADA INITIO and LYBALVI and increased pricing pressure.
Increased competition may lead to reduced unit sales of VIVITROL and increased pricing pressure. A number of companies currently market and/or are developing products to treat schizophrenia and/or bipolar I disorder that may compete with and negatively impact future sales of ARISTADA, ARISTADA INITIO and LYBALVI.
All of our royalties qualify for the sales-and-usage exemption under Topic 606 as (i) such royalties are based strictly on the sales-and-usage by 64 the licensee; and (ii) a license of IP is the sole or predominant item to which such royalties relate.
All of our royalties qualify for the sales-and-usage exemption under Topic 606 as (i) such royalties are based strictly on the sales-and-usage by the licensee; and (ii) a license of IP is the sole or predominant item to which such royalties relate.
For additional information related to discontinued operations, see Note 3, Discontinued Operations , in our “Notes to Consolidated Financial Statements” in this Annual Report. Impairment of Long-Lived Assets Long-lived assets, other than goodwill which is separately tested for impairment, are evaluated for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable.
For additional information related to discontinued operations, see Note 15, Discontinued Operations , in our “Notes to Consolidated Financial Statements” in this Annual Report. 72 Impairment of Long-Lived Assets Long-lived assets, other than goodwill which is separately tested for impairment, are evaluated for impairment whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable.
We expect that our existing cash, cash equivalents and investments will be sufficient to finance our anticipated working capital and other cash requirements, including capital expenditures, for at least the twelve months following the date from which our financial statements were issued.
We expect that our existing cash, cash equivalents, restricted cash and investments will be sufficient to finance our anticipated working capital and other cash requirements, including debt services and capital expenditures, for at least the twelve months following the date from which our financial statements were issued.
A detailed discussion of our 2022 financial condition and results of operations, and of 2023 year-over-year changes as compared to 2022, can be found in “Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2023, which was filed with the SEC on February 21, 2024.
A detailed discussion of our 2023 financial condition and results of operations, and of 2024 year-over-year changes as compared to 2023, can be found in “Item 7—Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2024, which was filed with the SEC on February 12, 2025.
We estimate that approximately $72.0 million of income taxes would be payable on the repatriation of the unremitted earnings to Ireland.
We estimate that approximately $70.0 million of income taxes would be payable on the repatriation of the unremitted earnings to Ireland.
Product Sales, Net Our product sales, net consist of sales in the U.S. of VIVITROL, ARISTADA, ARISTADA INITIO and LYBALVI, primarily to wholesalers, specialty distributors and pharmacies. Product sales, net are recognized when the customer obtains control of the product, which is when the product has been received by the customer.
Product Sales, Net Our product sales, net in 2025 and 2024 consisted of sales in the U.S. of ARISTADA, ARISTADA INITIO, LYBALVI and VIVITROL primarily to wholesalers, specialty distributors and pharmacies. Product sales, net are recognized when the customer obtains control of the product, which is when the product has been received by the customer.
Cumulative unremitted earnings of U.S. subsidiaries totaled approximately $933.5 million as of December 31, 2024. In the event of a repatriation of those earnings in the form of dividends or otherwise, we may be liable for income taxes, subject to adjustment, if any, for foreign tax credits and foreign withholding taxes payable to foreign tax authorities.
Cumulative unremitted earnings of U.S. subsidiaries totaled approximately $965.7 million as of December 31, 2025. In the event of a repatriation of those earnings in the form of dividends or otherwise, we may be liable for income taxes, subject to adjustment, if any, for foreign tax credits and foreign withholding taxes payable to foreign tax authorities.
Overview We have a portfolio of proprietary products that we manufacture, market and sell in the U.S.—VIVITROL, ARISTADA, ARISTADA INITIO and LYBALVI. We also earn manufacturing and/or royalty revenues on net sales of products commercialized by our licensees, the most significant of which in 2024 were the long-acting INVEGA products and VUMERITY.
Overview We have a portfolio of proprietary products that we manufacture, market and/or sell in the U.S., which in 2025 was comprised of ARISTADA, ARISTADA INITIO, LYBALVI and VIVITROL. We also earned manufacturing and/or royalty revenues on net sales of products commercialized by our licensees, the most significant of which in 2025 were the long-acting INVEGA products and VUMERITY.
In addition, each of INVEGA SUSTENNA and INVEGA TRINZA is currently subject to Paragraph IV litigation in response to companies seeking to market generic versions of such product.
In addition, INVEGA SUSTENNA is currently subject to Paragraph IV litigation in response to companies seeking to market generic versions of such product.
Cash flows provided by operating activities during 2024 primarily consisted of net income of $367.1 million, adjusted for non-cash items, including share-based compensation of $96.6 million and depreciation and amortization of $28.5 million and deferred income taxes of $40.5 million.
Cash flows provided by operating activities during 2024 primarily consisted of net income of $367.1 million, adjusted for non-cash items, including share-based compensation of $96.6 million, depreciation and amortization of $28.5 million and deferred income taxes of $40.5 million, partially offset by changes in working capital of $97.4 million.
The following table summarizes our cash flows for the years ended December 31, 2024 and 2023: Year Ended December 31, (In millions) 2024 2023 Cash and cash equivalents, beginning of period $ 457.5 $ 292.5 Cash flows provided by operating activities 439.1 401.4 Cash flows (used in) provided by investing activities (111.3 ) 53.3 Cash flows used in financing activities (494.1 ) (289.7 ) Cash and cash equivalents, end of period $ 291.2 $ 457.5 Operating Activities Cash flows provided by operating activities represent the cash receipts and disbursements related to all of our activities other than investing and financing activities.
The following table summarizes our cash flows for the years ended December 31, 2025 and 2024: Year Ended December 31, (In millions) 2025 2024 Cash, cash equivalents and restricted cash, beginning of period $ 291.1 $ 457.5 Cash flows provided by operating activities 520.8 439.1 Cash flows provided by (used in) investing activities 295.5 (111.3 ) Cash flows provided by (used in) financing activities 12.4 (494.1 ) Cash, cash equivalents and restricted cash, end of period $ 1,119.8 $ 291.2 Operating Activities Cash flows provided by operating activities represent the cash receipts and disbursements related to all of our activities other than investing and financing activities.
Manufacturing and Royalty Revenues Manufacturing revenue from RISPERDAL CONSTA and VUMERITY are recognized at the point in time that the product has been fully manufactured. Royalties earned on our licensees’ net sales of products using our proprietary technologies are recognized in the period such products are sold by our licensees.
Manufacturing and Royalty Revenues Substantially all of our manufacturing revenue was recognized at the point in time that the product has been fully manufactured. Royalties earned on our licensees’ net sales of products using our proprietary technologies and our licensed product were recognized in the period such products were sold by our licensees.
Debt In December 2024, we prepaid in full all Former Term Loans under the Former Credit Agreement for a total of $289.5 million. The Company did not incur any early termination penalties in connection with the termination of the Former Credit Agreement (other than customary breakage costs).
In December 2024, we prepaid in full all Former Term Loans under the Company’s then-in-effect amended and restated credit agreement (the “Former Credit Agreement”) for a total of $289.5 million and terminated the agreement. We did not incur any early termination penalties in connection with the termination of the Former Credit Agreement (other than customary breakage costs).
We have no off-balance sheet arrangements that are reasonably likely to have a material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources in the next 12 months.
We have no off-balance sheet arrangements that are reasonably likely to have a material effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures, or capital resources in the next 12 months. 68 Information about our cash flows, by category, is presented in the accompanying consolidated statements of cash flows.
The latest to expire of our patents covering ARISTADA, ARISTADA INITIO and LYBALVI in the U.S. will expire in 2039, 2039 and 2041, respectively; and, as such, we do not anticipate any generic versions of these products to enter the market in the near term.
Increased competition may lead to reduced unit sales of ARISTADA, ARISTADA INITIO and LYBALVI and increased pricing pressure. The latest to expire of our patents covering ARISTADA and ARISTADA INITIO in the U.S. will expire in 2039; and, as such, we do not anticipate any generic versions of these products to enter the market in the near term.
The following table compares product sales, net earned during the years ended December 31, 2024 and 2023: Year Ended December 31, (In millions) 2024 2023 Change VIVITROL $ 457.3 $ 400.4 $ 56.9 ARISTADA and ARISTADA INITIO 346.2 327.7 18.5 LYBALVI 280.0 191.9 88.1 Product sales, net $ 1,083.5 $ 920.0 $ 163.5 A number of companies currently market and/or are developing products to treat addiction, including alcohol and opioid dependence, that may compete with, and negatively impact, future sales of VIVITROL.
The following table compares product sales, net earned during the years ended December 31, 2025 and 2024: Year Ended December 31, (In millions) 2025 2024 Change VIVITROL $ 467.9 $ 457.3 $ 10.6 ARISTADA and ARISTADA INITIO 370.0 346.2 23.8 LYBALVI 346.7 280.0 66.7 Product sales, net $ 1,184.6 $ 1,083.5 $ 101.1 A number of companies currently market and/or are developing products to treat addiction, including alcohol and opioid dependence, that may compete with, and negatively impact, future sales of VIVITROL.
Increased competition from new products or generic versions of any one or more of the long-acting INVEGA products may lead to reduced unit sales of the long-acting INVEGA products, including those not yet genericized, and increased pricing pressure.
Though we no longer receive royalties from INVEGA SUSTENNA in the U.S., increased competition from new products or generic versions of any one or more of the long-acting INVEGA products may lead to reduced unit sales of all of the long-acting INVEGA products, including those not yet genericized, and increased pricing pressure.
The following table sets forth our external R&D expenses for the years ended December 31, 2024 and 2023 relating to our then-current development programs and our internal R&D expenses, listed by the nature of such expenses: Year Ended December 31, (In millions) 2024 2023 Change External R&D expenses: Development programs: ALKS 2680 $ 46.0 $ 31.3 $ 14.7 LYBALVI 18.7 15.4 3.3 Other external R&D expenses 36.6 51.7 (15.1 ) Total external R&D expenses 101.3 98.4 2.9 Internal R&D expenses: Employee-related 114.5 128.3 (13.8 ) Occupancy 11.2 12.3 (1.1 ) Depreciation 5.7 9.6 (3.9 ) Other 12.6 22.2 (9.6 ) Total internal R&D expenses 144.0 172.4 (28.4 ) Research and development expenses $ 245.3 $ 270.8 $ (25.5 ) These amounts are not necessarily predictive of future R&D expenses.
The following table sets forth our external R&D expenses for the years ended December 31, 2025 and 2024 relating to our then-current development programs and our internal R&D expenses, listed by the nature of such expenses: Year Ended December 31, (In millions) 2025 2024 Change External R&D expenses: Development programs: Alixorexton $ 95.8 $ 46.0 $ 49.8 LYBALVI 18.8 18.7 0.1 Other external R&D expenses 52.7 36.6 16.1 Total external R&D expenses 167.3 101.3 66.0 Internal R&D expenses: Employee-related 126.0 114.5 11.5 Occupancy 13.0 11.2 1.8 Depreciation 5.6 5.7 (0.1 ) Other 12.1 12.6 (0.5 ) Total internal R&D expenses 156.7 144.0 12.7 Research and development expenses $ 324.0 $ 245.3 $ 78.7 These amounts are not necessarily predictive of future R&D expenses.
Other Income, Net Year Ended December 31, (In millions) 2024 2023 Change Interest income $ 42.5 $ 30.9 $ 11.6 Interest expense (22.6 ) (23.0 ) 0.4 Other income (expense), net 3.2 (0.5 ) 3.7 Total other income, net $ 23.1 $ 7.4 $ 15.7 Interest income consists of interest earned on our cash and available-for-sale investments.
Other Income, Net Year Ended December 31, (In millions) 2025 2024 Change Interest income $ 45.3 $ 42.5 $ 2.8 Interest expense (12.3 ) (22.6 ) 10.3 Other income, net 4.5 3.2 1.3 Total other income, net $ 37.5 $ 23.1 $ 14.4 Interest income consists of interest earned on our cash and available-for-sale investments.
As of December 31, 2024, we had $393.9 million of Irish NOL carryforwards, $14.1 million of U.S. federal NOL carryforwards, $43.2 million of state NOL carryforwards and $34.0 million of state tax credits which will either expire on various dates through 2039 or can be carried forward indefinitely.
As of December 31, 2025, we had $210.2 million of Irish NOL carryforwards, $13.6 million of U.S. federal NOL carryforwards, $43.2 million of state NOL carryforwards and $35.2 million of state tax credits which will either expire on various dates through 2040 or can be carried forward indefinitely.
These events were partially offset by an increase in our product sales, net and a decrease in our operating expenses in 2024. These items are discussed in further detail within the “Results of Operations” section below.
These items were partially offset by an increase in product sales, net of $101.1 million and a decrease in our income tax provision of $21.8 million. These items are discussed in further detail within the “Results of Operations” section below.
Ireland Total Cash and cash equivalents $ 70.3 $ 220.8 $ 291.1 $ 317.8 $ 139.7 $ 457.5 Investments—short-term 203.6 256.9 460.5 187.6 128.4 316.0 Investments—long-term 24.6 48.5 73.1 18.0 21.9 39.9 Total cash and investments $ 298.5 $ 526.2 $ 824.7 $ 523.4 $ 290.0 $ 813.4 Outstanding borrowings—short and long-term $ — $ — $ — $ 290.7 $ — $ 290.7 At December 31, 2024, our investments consisted of the following: Gross Amortized Unrealized Allowance for Estimated (In millions) Cost Gains Losses Credit Losses Fair Value Investments—short-term available-for-sale $ 459.1 $ 1.5 $ (0.1 ) $ — $ 460.5 Investments—long-term available-for-sale 73.3 — (0.3 ) — 73.0 Investments—long-term held-to-maturity 0.1 — — — 0.1 Total $ 532.5 $ 1.5 $ (0.4 ) $ — $ 533.6 Sources and Uses of Cash We generated $439.1 million and $401.4 million of cash from operating activities during the years ended December 31, 2024 and 2023, respectively.
Ireland Total Cash and cash equivalents $ 129.1 $ 259.5 $ 388.6 $ 70.3 $ 220.8 $ 291.1 Restricted cash — 731.2 731.2 — — — Investments—short-term 199.1 0.5 199.6 203.6 256.9 460.5 Investments—long-term 0.1 — 0.1 24.6 48.5 73.1 Total cash, restricted cash and investments $ 328.3 $ 991.2 $ 1,319.5 $ 298.5 $ 526.2 $ 824.7 At December 31, 2025, our investments consisted of the following: Gross Amortized Unrealized Allowance for Estimated (In millions) Cost Gains Losses Credit Losses Fair Value Investments—short-term available-for-sale $ 198.7 $ 0.9 $ — $ — $ 199.6 Investments—long-term available-for-sale — — — — — Investments—long-term held-to-maturity 0.1 — — — 0.1 Total $ 198.8 $ 0.9 $ — $ — $ 199.7 Sources and Uses of Cash We generated $520.8 million and $439.1 million of cash from operating activities during the years ended December 31, 2025 and 2024, respectively.
Financing Activities Cash flows used in financing activities during 2024 primarily related to the prepayment of our previously outstanding long-term debt in the full amount of $289.5 million, payment for the repurchase of our ordinary shares and related expenses in the amount of $200.3 million, and $29.6 million of employee taxes paid related to net share settlements of equity awards, partially offset by $27.6 million of cash that we received upon exercises of employee stock options.
Cash flows used in financing activities during 2024 primarily related to the prepayment of our previously outstanding long-term debt in the full amount of $289.5 million, payment for the repurchase of our ordinary shares and related expenses in the amount of $200.3 million, and $29.6 million of employee taxes paid related to net share settlements of equity awards, partially offset by $27.6 million of cash that we received upon exercises of employee stock options. 69 Debt On February 12, 2026, in connection with the Avadel Acquisition, we entered into a credit agreement (the “Credit Agreement”), by and among Alkermes plc, as the TopCo Borrower, Alkermes, Inc., as the U.S.
Our effective tax rate during the year ended December 31, 2024 was 16.1%, which exceeds the Irish statutory tax rate of 12.5%, primarily due to non-deductible expenses and income that was taxable at rates higher than the Irish statutory tax rate. The new corporate minimum tax rate of 15.0% did not have a material impact on our business in 2024.
Our effective tax rate during the year ended December 31, 2025 was 17.1%, which exceeds the Irish statutory tax rate of 12.5%, primarily due to non-deductible expenses and income that was taxable at rates higher than the Irish statutory tax rate. Our effective tax rate during the year ended December 31, 2024 was 16.1%.
In 2024, actual Medicaid utilization rates related to VIVITROL were lower than original estimates, due, in part, to $8.7 million in actual credits received in the fourth quarter of 2024 from certain states related to duplicate Medicaid billings.
In 2024, actual Medicaid utilization rates related to VIVITROL were lower than original estimates, due, in part, to $8.7 million in actual credits received from certain states in the fourth quarter of 2024 related to duplicate Medicaid billings; • Chargebacks —discounts that occur when contracted indirect customers purchase directly from wholesalers and specialty distributors.
The following table presents the adjustments deducted from product sales, gross to arrive at product sales, net, for sales of these products during the years ended December 31, 2024 and 2023: Year Ended December 31, (In millions, except for % of Sales) 2024 % of Sales 2023 % of Sales Product sales, gross $ 2,119.5 100.0 % $ 1,855.4 100.0 % Adjustments to product sales, gross: Medicaid rebates (454.0 ) (21.4 ) % (426.4 ) (23.0 ) % Chargebacks (231.5 ) (10.9 ) % (189.1 ) (10.2 ) % Product discounts (155.1 ) (7.3 ) % (137.7 ) (7.4 ) % Medicare Part D (83.0 ) (3.9 ) % (74.4 ) (4.0 ) % Other (112.4 ) (5.4 ) % (107.8 ) (5.8 ) % Total adjustments (1,036.0 ) (48.9 ) % (935.4 ) (50.4 ) % Product sales, net $ 1,083.5 51.1 % $ 920.0 49.6 % 56 VIVITROL product sales, gross, increased by 10%, which was primarily due to a 7% increase in the number of units sold and a 3.2% increase in the selling price that went into effect in January 2024.
The following table presents the adjustments deducted from product sales, gross to arrive at product sales, net, for sales of these products during the years ended December 31, 2025 and 2024: Year Ended December 31, (In millions, except for % of Sales) 2025 % of Sales 2024 % of Sales Product sales, gross $ 2,212.5 100.0 % $ 2,119.5 100.0 % Adjustments to product sales, gross: Medicaid rebates (421.8 ) (19.1 ) % (454.0 ) (21.4 ) % Chargebacks (254.3 ) (11.5 ) % (231.5 ) (10.9 ) % Product discounts (166.2 ) (7.5 ) % (155.1 ) (7.3 ) % Medicare Part D (79.5 ) (3.5 ) % (83.0 ) (3.9 ) % Other (106.1 ) (4.8 ) % (112.4 ) (5.4 ) % Total adjustments (1,027.9 ) (46.4 ) % (1,036.0 ) (48.9 ) % Product sales, net $ 1,184.6 53.6 % $ 1,083.5 51.1 % The increase in product sales, gross was due to a 19% increase in the number of units sold for LYBALVI and a 3% price increase for each of LYBALVI, ARISTADA/ARISTADA INITIO and VIVITROL that went into effect in January 2025, partially offset by decreases of 3% and 2% in the number of units sold for VIVITROL and ARISTADA/ARISTADA INITIO, respectively.
We are aware of potential generic and other competition to RISPERDAL CONSTA that may lead to reduced unit sales and increased pricing pressure. For a discussion of our agreements with Janssen related to RISPERDAL CONSTA, including the manufacturing provisions set forth therein, see the section entitled “ Collaborative Arrangements—Janssen ” in “Item 1—Business” in this Annual Report.
For a discussion of our agreements with Janssen related to RISPERDAL CONSTA, including the manufacturing provisions set forth therein, see the section entitled “ Collaborative Arrangements—Janssen ” in “Item 1—Business” in this Annual Report.
Cash flows provided by operating activities during 2023 primarily consisted of net income of $355.8 million, adjusted for non-cash items, including share-based compensation of $100.9 million and depreciation and amortization of $74.9 million, partially offset by changes in working capital of $36.7 million and deferred income taxes of $99.9 million.
Cash flows provided by operating activities during 2025 primarily consisted of net income of $241.7 million, adjusted for non-cash items, including share-based compensation of $98.7 million, depreciation and amortization of $27.2 million, deferred income taxes of $28.8 million and $119.1 million of changes in working capital.
See Note 12, Long-Term Debt , in the “Notes to Consolidated Financial Statements” in this Annual Report for additional discussion related to our Former Term Loans. 62 Discontinued Operations Net loss from discontinued operations consists of the results of our former oncology business and is reported as a separate component of income.
Discontinued Operations Net loss from discontinued operations consists of the results of our former oncology business and is reported as a separate component of income. For additional information, see Note 15, Discontinued Operations , in the “Notes to Consolidated Financial Statements” in this Annual Report. Critical Accounting Estimates Our consolidated financial statements are prepared in accordance with GAAP.
The ability to realize deferred tax assets depends on the ability to generate sufficient taxable income within the carryback or carryforward periods provided for in the tax law for each applicable tax jurisdiction.
Valuation of Deferred Tax Assets We evaluate the need for deferred tax asset valuation allowances based on a more-likely-than-not standard. The ability to realize deferred tax assets depends on the ability to generate sufficient taxable income within the carryback or carryforward periods provided for in the tax law for each applicable tax jurisdiction.
Income Tax Provision (Benefit) Year Ended December 31, (In millions) 2024 2023 Change Income tax provision (benefit) $ 71.6 $ (97.6 ) $ 169.2 The income tax provision in 2024 was primarily due to taxes on income earned in Ireland.
Income Tax Provision Year Ended December 31, (In millions) 2025 2024 Change Income tax provision $ 49.8 $ 71.6 $ (21.8 ) The income tax provisions in 2025 and 2024 were primarily due to taxes on income earned in Ireland.
Under the terms of a settlement and license agreement entered into in July 2019 with Amneal, we granted Amneal a non-exclusive license under certain patents covering VIVITROL, including the remaining patent covering VIVITROL in the U.S., to market and sell a generic formulation of VIVITROL in the U.S. beginning on the earlier of the First Entry Date, sometime in 2028 or earlier under certain circumstances.
Under the terms of a settlement and license agreement entered into in July 2019 with Amneal, we granted Amneal a non-exclusive license under certain patents covering VIVITROL, including the remaining patent covering VIVITROL in the U.S., to market and sell a generic formulation of VIVITROL in the U.S. beginning on the earlier of the First Entry Date, sometime in 2028 or earlier under certain circumstances, and in September 2025, entered into an authorized generic product supply agreement (the “AG Agreement”) with Amneal, pursuant to which we granted Amneal certain rights to distribute and sell in the U.S. an authorized generic version of VIVITROL for a one-year term beginning on the date of a Third Party ANDA Product Launch (as defined in the AG Agreement), subject to certain conditions set forth in the AG Agreement.
Actual product returns have not differed materially from our estimates; and • Medicare Part D —we record accruals for Medicare Part D liabilities under the Medicare Coverage Gap Discount Program (“CGDP”) as a reduction of sales. Under the CGDP, patients reaching the annual coverage gap threshold are eligible for reimbursement coverage for out-of-pocket costs for covered prescription drugs.
Actual product returns have not differed materially from our estimates; and • Medicare Part D —we record accruals for Medicare Part D liabilities under the Medicare Manufacturer Discount Program as a reduction of sales.
Included within these loss and credit carryforwards are $14.1 million of U.S. federal NOL carryforwards and $5.8 million of state NOL 60 carryforwards, acquired as part of the acquisition of Rodin Therapeutics, Inc. (“Rodin”) in November 2019, each of which are subject to a $0.5 million annual limitation.
Included within these loss and credit carryforwards are $13.6 million of U.S. federal NOL carryforwards and $5.3 million of state NOL carryforwards, acquired as part of the acquisition of Rodin Therapeutics, Inc. in November 2019, each of which are subject to a $0.5 million annual limitation. 67 Liquidity and Capital Resources Our financial condition is summarized as follows: December 31, 2025 December 31, 2024 (In millions) U.S.
All liens on the collateral securing the obligations under the Former Credit Agreement were released in connection with the termination. Such prepayment was accounted for as a debt extinguishment.
All liens on the collateral securing the obligations under the Former Credit Agreement were released in connection with the termination. Such prepayment was accounted for as a debt extinguishment. See Note 11, Long-Term Debt , in the “Notes to Consolidated Financial Statements” in this Annual Report for additional discussion related to our Former Term Loans.
The following table compares manufacturing and royalty revenues earned in the years ended December 31, 2024 and 2023: Year Ended December 31, (In millions) 2024 2023 Change Manufacturing and royalty revenues: Long-acting INVEGA products $ 236.5 $ 486.1 $ (249.6 ) VUMERITY 134.0 129.3 4.7 RISPERDAL CONSTA 23.5 37.3 (13.8 ) Other 80.1 90.7 (10.6 ) Manufacturing and royalty revenues $ 474.1 $ 743.4 $ (269.3 ) The decrease in royalty revenues related to the long-acting INVEGA products was primarily due to the receipt in June 2023 of back royalties of $195.4 million, inclusive of $8.1 million in late-payment interest, related to 2022 U.S. sales of the long-acting INVEGA products following the successful outcome of the arbitration proceedings related to such products and the expiration of our royalty on U.S. net sales of INVEGA SUSTENNA in August 2024.
The following table compares manufacturing and royalty revenues earned in the years ended December 31, 2025 and 2024: Year Ended December 31, (In millions) 2025 2024 Change Manufacturing and royalty revenues: Long-acting INVEGA products $ 109.6 $ 236.5 $ (126.9 ) VUMERITY 130.5 134.0 (3.5 ) RISPERDAL CONSTA 19.6 23.5 (3.9 ) Other 31.6 80.1 (48.5 ) Manufacturing and royalty revenues $ 291.3 $ 474.1 $ (182.8 ) The decrease in royalty revenues related to the long-acting INVEGA products was primarily due to the expiration of our royalty on net sales of INVEGA SUSTENNA in the U.S. in August 2024.
This includes RISPERDAL CONSTA as well as products manufactured at the Athlone Facility. This decrease was partially offset by an increase in the cost of goods sold for certain of our proprietary products due to increases in the number of units sold as discussed above, and an increase in costs related to VIVITROL out-of-specification batches and subsequent investigation costs.
We also had decreases in the cost of goods sold for certain of our proprietary products, primarily due to decreases in costs related to out-of-specification batches and investigation costs. These decreases were partially offset by an increase in the cost of goods sold for LYBALVI due to an increase in the number of units sold, as discussed above.
The increase in expenses related to ALKS 2680 was primarily due to an increase in spend related to the advancement of the development programs for the product, including completion of our phase 1b proof-of-concept studies, initiation of our phase 2 clinical studies, Vibrance-1 and Vibrance-2 and preparatory spend in advance of initiation of our phase 2 study for IH.
The increase in expenses related to alixorexton was primarily due to increased spend related to the advancement of the development program for the product, including initiation of our Vibrance-3 phase 2 clinical study, costs related to the completion of our Vibrance-1 and Vibrance-2 phase 2 studies, startup costs related to planning for our phase 3 clinical program and costs related to our long-term extension study for the product.
For a discussion of legal proceedings related to INVEGA TRINZA, see Note 19, Commitments and Contingent Liabilities in the “Notes to Consolidated Financial Statements” in this Annual Report, and for information about risks relating to these legal proceedings, see “Item 1A—Risk Factors” in this Annual Report, and specifically the section entitled “Uncertainty over IP in the biopharmaceutical industry has been the source of litigation and other legal proceedings, and we or our licensees may face claims against IP rights covering our products and competition from generic drug manufacturers.” The increase in VUMERITY revenue was due to an $8.3 million increase in royalty revenue, partially offset by a $3.6 million decrease in manufacturing revenue.
For a discussion of these legal proceedings, see Note 19, Commitments and Contingent Liabilities in the “Notes to Consolidated Financial Statements” in this Annual Report and for information regarding the risks relating to these legal proceedings, see “Risks Related to our Intellectual Property—Uncertainty 64 over IP in the biopharmaceutical industry has been the source of litigation and other legal proceedings, and we and our licensees have previously and may in the future face claims against IP rights covering our products and competition from generic drug manufacturers”.
We expect royalty revenues from net sales of the long-acting INVEGA products to decrease further in 2025, as the royalty revenues related to U.S. net sales of INVEGA SUSTENNA comprised a significant portion of the overall royalty revenues for the long-acting INVEGA products.
Although we expect royalty revenues related to U.S. net sales of INVEGA TRINZA and INVEGA HAFYERA through certain specified dates in 2030, total royalty revenues from net sales of the long-acting INVEGA products have been, and we expect will continue to be lower as the royalty revenues related to U.S. net sales of INVEGA SUSTENNA comprised a significant portion of the overall royalty revenues from the long-acting INVEGA products.
Business Update In May 2024, we completed the sale of the Athlone Facility to Novo and entered into subcontracting arrangements to continue certain development and manufacturing activities performed at the Athlone Facility, which may continue through the end of 2025.
In May 2024, we completed the sale of the Athlone Facility to Novo and entered into subcontracting arrangements to continue certain development and manufacturing activities performed at the Athlone Facility, which concluded by the end of 2025. 63 Results of Operations Product Sales, Net Our product sales, net, consisted of sales of ARISTADA, ARISTADA INITIO, LYBALVI and VIVITROL, primarily to wholesalers, specialty distributors and pharmacies.
We expect VIVITROL, ARISTADA, ARISTADA INITIO, LYBALVI and VUMERITY to generate significant revenues for us in the near- and medium-term as we believe these products are singular or competitively advantaged products in their classes. In 2024, our net income from continuing operations was $372.1 million, as compared to $519.2 million in 2023.
We expect ARISTADA, ARISTADA INITIO, LYBALVI, VIVITROL and VUMERITY, and our new product, LUMRYZ, which we acquired and began to market and sell in the U.S. in February 2026, to generate significant revenues for us in the near- and medium-term as we believe these products are singular or competitively advantaged products in their classes.
Chargebacks could exceed historical experience and our estimates of future participation in these programs.
The allowance for chargebacks is made using the expected value and is based on actual and expected utilization of these programs. Chargebacks could exceed historical experience and our estimates of future participation in these programs.
The wholesaler or specialty distributor, in turn, then generally charges back to us the difference between the wholesale acquisition cost and the contracted price paid to the wholesaler or specialty distributor by the customer. The allowance for chargebacks is made using the expected value and is based on actual and expected utilization of these programs.
Contracted customers generally purchase a product at its contracted price. The wholesaler or specialty distributor, in turn, then generally charges back to us the difference between the wholesale acquisition cost and the contracted price paid to the wholesaler or specialty distributor by the customer.
The decrease in revenue from RISPERDAL CONSTA was primarily due to a decrease of $13.0 million in manufacturing revenue, which was primarily due to a decrease in the number of batches made available to Janssen.
The decrease in revenue related to RISPERDAL CONSTA was primarily due to a $3.6 million decrease in manufacturing revenue, primarily due to a decrease in the number of batches made available to Janssen for sale in the U.S., which has a higher selling price than product sold outside of the U.S.
Cash flows used in financing activities during 2023 primarily related to $275.0 million in cash distributed to Mural Oncology plc in connection with the Separation and $28.5 million of employee taxes paid related to net share settlements of equity awards, partially offset by $16.8 million of cash that we received upon exercises of employee stock options.
Financing Activities Cash flows provided by financing activities during 2025 were due to $43.4 million of cash that we received upon exercises of employee stock options, partially offset by $31.0 million of employee taxes paid related to the net share settlement of equity awards.
See “Item 7A—Quantitative and Qualitative Disclosures about Market Risk” in this Annual Report for information on currency exchange rate risk related to our revenues and “Item 1A—Risk Factors” in this Annual Report, and specifically the section entitled “Currency exchange rates may affect revenues and expenses” for risks related to currency exchange rates.
See “Item 7A—Quantitative and Qualitative Disclosures about Market Risk” in this Annual Report for information on currency exchange rate risk related to our revenues and “Item 1A—Risk Factors” in this Annual Report, and specifically the section entitled “Currency exchange rates may affect revenues and expenses” for risks related to currency exchange rates. 65 Costs and Expenses Cost of Goods Manufactured and Sold Year Ended December 31, (In millions) 2025 2024 Change Cost of goods manufactured and sold $ 196.5 $ 245.3 $ (48.8 ) The decrease in the cost of goods manufactured and sold was primarily related to a $43.7 million decrease in the cost of goods manufactured for certain legacy products following the sale of the Athlone Facility in May 2024.
Interest expense consists of interest incurred on our previously outstanding term loans scheduled to become due in 2026 (the “Former Term Loans”) under our former amended and restated credit agreement (the “Former Credit Agreement”), which we prepaid in full and terminated on December 19, 2024.
Interest expense consisted, in 2025, of financing costs related to the amended and restated bridge term loan credit agreement that we entered into on November 18, 2025, which provided for a senior secured bridge term loan facility in an aggregate amount of up to approximately $1.5 billion to fund the Avadel Acquisition (the “Bridge Credit Agreement”) and, in 2024, of previously outstanding term loans (the “Former Term Loans”) that were scheduled to become due in 2026 under our former amended and restated credit agreement, which we prepaid in full and terminated in December 2024.
The decrease in Medicaid rebates as a percentage of sales was primarily due to the increase in sales of LYBALVI, which has lower Medicaid utilization than VIVITROL, ARISTADA and ARISTADA INITIO, and actual Medicaid utilization rates related to VIVITROL being lower than original estimates, due, in part, to $8.7 million in actual credits received in the fourth quarter of 2024 from certain states related to duplicate Medicaid billings.
The decrease in Medicaid rebates as a percentage of sales was primarily due to gross-to-net favorability, as actual Medicaid rebates related to VIVITROL and ARISTADA/ARISTADA INITIO were lower than original estimates by approximately $26.7 million and $13.6 million, respectively.
Increased competition may lead to reduced unit sales of VIVITROL and increased pricing pressure. The latest to expire of our patents covering VIVITROL will expire in 2029 in the U.S.
In addition, the latest to expire of our patents covering VIVITROL will expire in 2029 in the U.S. and we expect generic versions of VIVITROL to enter the market in 2027.
The decrease in royalty revenue was due to expirations of the patents covering RISPERDAL CONSTA, which expired in the U.S. in January 2023 and in the EU in 2021. We expect revenues from RISPERDAL CONSTA to continue to decrease as patents covering RISPERDAL CONSTA continue to expire in markets where end-market net sales of RISPERDAL CONSTA occur.
We expect revenues from RISPERDAL CONSTA to continue to decrease as patents covering RISPERDAL CONSTA continue to expire in markets where end-market net sales of RISPERDAL CONSTA occur. We are aware of generic and other competition to RISPERDAL CONSTA that may lead to reduced unit sales and increased pricing pressure.
Selling, General and Administrative Expenses Year Ended December 31, (In millions) 2024 2023 Change Selling and marketing expense $ 446.2 $ 490.2 $ (44.0 ) General and administrative expense 199.0 199.6 (0.6 ) Selling, general and administrative expense $ 645.2 $ 689.8 $ (44.6 ) 59 The decrease in selling and marketing expense was primarily due to a $34.6 million decrease in marketing expense related primarily to decreased media spend and free goods, a $7.1 million decrease in professional services, primarily due to the decrease in media spend, and a $3.6 million decrease in employee related expenses, primarily due to a 7% decrease in sales and marketing headcount.
The increase in employee-related expenses was primarily due to increases in labor and benefits expense related to a 7% increase in R&D-related headcount during 2025. 66 Selling, General and Administrative Expenses Year Ended December 31, (In millions) 2025 2024 Change Selling and marketing expense $ 480.0 $ 446.2 $ 33.8 General and administrative expense 221.5 199.0 22.5 Selling, general and administrative expense $ 701.5 $ 645.2 $ 56.3 The increase in selling and marketing expense was primarily due to increases of $33.3 million and $9.4 million in employee-related expenses and certain sales and marketing-related training programs and materials, respectively, due to a 10% increase in sales and marketing-related headcount, partially offset by a $9.5 million decrease in marketing spend, primarily related to decreases in media spend for our proprietary products.
Cash flows provided by investing activities during 2023 primarily consisted of $101.1 million in net sales of investments and offset by the purchase of $48.0 million of property, plant and equipment. We expect to spend approximately $45.0 million to $50.0 million during the year ending December 31, 2025 for capital expenditures.
Investing Activities Cash flows provided by investing activities during 2025 primarily consisted of $333.1 million of net proceeds from the sale and maturities of investments, partially offset by the purchase of $40.4 million of property, plant and equipment.
For additional information, see Note 3, Discontinued Operations , in the “Notes to Consolidated Financial Statements” in this Annual Report. Critical Accounting Estimates Our consolidated financial statements are prepared in accordance with GAAP.
See Note 11, Long-Term Debt in the “Notes to Consolidated Financial Statements” in this Annual Report for additional information regarding the Bridge Credit Agreement and Former Term Loans.
The increase in royalty revenue was primarily due to an increase in end-market sales of VUMERITY to $628.0 million in 2024, as compared to $576.3 million in 2023. The decrease in manufacturing revenue was primarily due to a reduction in the selling price. The manufacturing fee we earn is based on our cost to produce VUMERITY.
The decrease in VUMERITY revenue was due to a $22.8 million decrease in manufacturing revenue, primarily due to a reduction in the number of batches manufactured for sale to Biogen, partially offset by a $19.2 million increase in royalty revenue, due to an increase in end-market sales of the product.
The decrease in employee-related expenses was primarily due to a decrease in salaries and benefits related to a 10% reduction in R&D-related headcount during 2024.
The increase in general and administrative expense was primarily due to a $12.5 million increase in employee-related expenses, primarily due to a 9% increase in general and administrative-related headcount and a $10.7 million increase in professional service fees, primarily related to the Avadel Acquisition.
Removed
The decrease in net income from continuing operations was primarily due to two significant one-time events in 2023, which were the receipt in June 2023 of back royalties and interest in respect of 2022 U.S. sales of the long-acting INVEGA products, following the successful outcome of the arbitration proceedings related to such products, and the partial release of our valuation allowance maintained against certain Irish deferred tax assets.
Added
In 2025, our net income from continuing operations was $241.7 million, as compared to $372.1 million in 2024. The decrease in net income from continuing operations of $130.5 million was primarily due to an increase in total expenses of $84.9 million and a decrease of $182.8 million in manufacturing and royalty revenues.
Removed
In November 2023, we completed the separation of our former oncology business into a new, independent, publicly-traded company (the “Separation”), which is more fully described in Note 3, Discontinued Operations , in the “Notes to Consolidated Financial Statements” in this Annual Report.
Added
Business Update In October 2025, we entered into the Transaction Agreement with Avadel, which was subsequently amended in November 2025, pursuant to which we agreed to acquire the entire issued and to be issued ordinary share capital of Avadel for consideration of (i) $21.00 per Avadel Share, payable in cash at closing and (ii) a non-transferable CVR entitling holders of Avadel Shares to a potential additional cash payment of $1.50 per Avadel Share, contingent upon achievement of a certain specified milestone.
Removed
Results of Operations As a result of the Separation, the historical results of our former oncology business have been reflected as discontinued operations in our consolidated financial statements through November 15, 2023, the date of the Separation. Prior period results of operations and balance sheet information have been recast to reflect this presentation.
Added
On February 12, 2026, we successfully completed the Avadel Acquisition, adding both LUMRYZ to our portfolio of proprietary commercial products and a commercial organization with experience in narcolepsy. During the three months ended December 31, 2025, we incurred costs of approximately $10.0 million in connection with the Avadel Acquisition.
Removed
Product Sales, Net Our product sales, net, consist of sales of VIVITROL, ARISTADA, ARISTADA INITIO, and LYBALVI, primarily to wholesalers, specialty distributors and pharmacies.
Added
The latest to expire of our patents covering LYBALVI in the U.S. will expire in 2041. We are currently engaged in Paragraph IV litigation with certain entities in respect of certain of the Company’s patents related to LYBALVI with expiration dates between 2032 and 2041.
Removed
ARISTADA and ARISTADA INITIO product sales, gross, increased by 5%, which was primarily due to a 3% increase in the number of units sold and a 3.0% increase in the selling price that went into effect in January 2024.
Added
The decrease in Other manufacturing and royalty revenue was primarily due to a $36.6 million decrease in revenue from FAMPYRA, as our manufacturing obligations for FAMPYRA concluded on December 31, 2024, and a $10.5 million decrease in manufacturing revenue from certain of our other legacy products.
Removed
LYBALVI product sales, gross, increased by 52%, which was primarily due to a 45% increase in the number of units sold and increases of 3.8% and 2.0% in the selling price that went into effect in January 2024 and July 2024, respectively.
Added
The increase in other external R&D expenses was primarily due to activities associated with our preclinical development programs. We expect R&D expense to increase in 2026, as we plan to initiate the phase 3 program for alixorexton and as ALKS 4510 and ALKS 7290, two internal early-stage development candidates which entered the clinic in 2025, advance.
Removed
Pursuant to the Final Award issued in the arbitration proceedings, 57 we are entitled to royalty revenues from Janssen related to U.S. net sales of INVEGA TRINZA and INVEGA HAFYERA through certain specified dates in 2030.
Added
The increase in the effective tax rate was primarily due to an increase in income taxable at rates higher than the Irish statutory tax rate. The new corporate minimum tax rate of 15% did not have a material impact on our business in 2025 and 2024.
Removed
As the assets used to manufacture VUMERITY were classified as held for sale and transferred to Novo in connection with the sale of the Athlone Facility, depreciation expense was removed from the manufacturing cost base, which had a negative impact on our manufacturing fee.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeWe have the intent and ability to hold these securities until recovery, which may be at maturity. 66 Currency Exchange Rate Risk Manufacturing and royalty revenues that we receive on certain of our products and services are a percentage of the net sales made by our licensees, and a portion of these sales are made in countries outside the U.S. and are denominated in currencies in which the product is sold, which is predominantly the euro.
Biggest changeCurrency Exchange Rate Risk Manufacturing and royalty revenues that we receive on certain of our products and services are a percentage of the net sales made by our licensees, and a portion of these sales are made in countries outside the U.S. and are denominated in currencies in which the product is sold, which is predominantly the euro.
For the year ended December 31, 2024, an average 10% weakening in the USD relative to the euro would have resulted in an increase to our expenses denominated in euro of approximately $3.9 million, as compared to an increase in our expenses of approximately $7.7 million for the year ended December 31, 2023.
For the year ended December 31, 2025, an average 10% weakening in the USD relative to the euro would have resulted in an increase to our expenses denominated in euro of approximately $3.7 million, as compared to an increase in our expenses of approximately $3.9 million for the year ended December 31, 2024. 74
For the year ended December 31, 2024, an average 10% strengthening of the USD relative to the currencies in which these products are sold would have resulted in revenues being reduced by approximately $8.9 million, as compared to a reduction in revenues of approximately $10.3 million for the year ended December 31, 2023.
For the year ended December 31, 2025, an average 10% strengthening of the USD relative to the currencies in which these products are sold would have resulted in revenues being reduced by approximately $13.9 million, as compared to a reduction in revenues of approximately $8.9 million for the year ended December 31, 2024.
We do not believe our exposure to liquidity and credit risk to be significant as approximately 41% and 59% of our investments at December 31, 2024 are in corporate debt securities with a minimum rating of A2 (Moody’s)/A (Standard and Poor’s) and debt securities issued by the U.S. government or its agencies, respectively.
We do not believe our exposure to liquidity and credit risk to be significant as approximately 49% and 51% of our investments at December 31, 2025 are in corporate debt securities with a minimum rating of A2 (Moody’s)/A (Standard and Poor’s) and debt securities issued by the U.S. government or its agencies, respectively.
Added
We have the intent and ability to hold these securities until recovery, which may be at maturity.

Other ALKS 10-K year-over-year comparisons