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What changed in OPKO HEALTH, INC.'s 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of OPKO HEALTH, INC.'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.

+173 added−186 removedSource: 10-K (2026-02-26) vs 10-K (2025-03-03)

Top changes in OPKO HEALTH, INC.'s 2025 10-K

173 paragraphs added · 186 removed · 109 edited across 2 sections

Item 7. Management's Discussion & Analysis

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

98 edited+64 added−76 removed100 unchanged
Biggest changeFor the year ended December 31, 2023, revenue from the transfer of intellectual property included $116.7 million from Pfizer, which included a $90.0 million milestone payment triggered by the FDA approval of NGENLA (Somatrogon), $22.6 million from gross profit share and royalty payments for both NGENLA (Somatrogon) and Pfizer's Genotropin® (Somatropin), $50.0 million from Merck in consideration for the rights granted under the Merck Agreement, $7.0 million from VFMCRP triggered by the German price approval for Rayaldee , $2.5 million from Nicoya due to Nicoya's submission of the investigational new drug application to China's Center for Drug Evaluation, $1.2 million from the BARDA Contract, and $2.4 million from contract manufacturers' commercial milestones.
Biggest changeThe following summarize the components of revenue from the transfer of intellectual property and other for the periods presented, highlighting the impact of significant milestones, royalties, and upfront payments on our results of operations: Year Ended December 31, 2025 • BARDA Contract: $28.5 million recognized for ongoing performance • Pfizer:$31.9 million in royalty revenue, consisting of gross profit share and royalty payments for NGENLA ® and Genotropin® • Regeneron:$7.2 million which includes $7.0 million upfront payment • Eli Lilly: $4.3 million in royalty revenue following the commercial launch of Mazdutide in China • Contract Manufacturers: $7.4 million from commercial milestones Year Ended December 31, 2024 • Pfizer:$30.0 million, inclusive of $28.3 million from gross profit share and royalty payments for both NGENLA ® and Pfizer's Genotropin® (Somatropin) • BARDA Contract: $23.8 million recognized under the agreement • Merck:$12.5 million milestone payment under the Merck Agreement • Contract Manufacturers: $10.2 million from commercial milestones Year Ended December 31, 2023 • Pfizer:$116.7 million, which included a $90.0 million milestone payment triggered by the FDA approval of NGENLA ® and $22.6 million from gross profit share and royalty payments for both NGENLA ® and Pfizer's Genotropin® • Merck:$50.0 million in consideration for the rights granted under the Merck Agreement • VFMCRP:$7.0 million triggered by the German price approval for Rayaldee • Nicoya:$2.5 million due to the submission of the investigational new drug application to China's Center for Drug Evaluation • BARDA Contract: $1.2 million recognized under the agreement • Contract Manufacturers: $2.4 million from commercial milestones Concentration of credit risk and allowance for doubtful accounts .
Cost of revenue . Cost of revenue for the year ended December 31, 2024 decreased by 7% to $92.5 million compared to $99.5 million for the year ended December 31, 2023, which was primarily driven by favorable foreign exchange fluctuations.
Cost of revenue for the year ended December 31, 2024 decreased by 7% to $92.5 million compared to $99.5 million for the year ended December 31, 2023, which was primarily driven by favorable foreign exchange fluctuations.
For The Years Ended December 31, 2024 and 2023 Our consolidated loss from operations for the years ended December 31, 2024 and 2023 was as follows: For the years ended December 31, (In thousands) 2024 2023 Change % Change Revenues: Revenue from services $ 480,667 $ 515,275 $ (34,608 ) (7 )% Revenue from products 155,111 167,557 (12,446 ) (7 )% Revenue from transfer of intellectual property and other 77,364 180,663 (103,299 ) (57 )% Total revenues 713,142 863,495 (150,353 ) (17 )% Costs and expenses: Cost of revenue 494,632 545,368 (50,736 ) (9 )% Selling, general and administrative 304,220 300,559 3,661 1 % Research and development 105,214 89,593 15,621 17 % Contingent consideration - (1,036 ) 1,036 100 % Amortization of intangible assets 82,634 86,032 (3,398 ) (4 )% Gain on sale of assets (121,493 ) - (121,493 ) (100 )% Total costs and expenses 865,207 1,020,516 (155,309 ) (15 )% Loss from operations (152,065 ) (157,021 ) 4,956 3 % 64 Table of Contents Diagnostics For the years ended December 31, (In thousands) 2024 2023 Change % Change Revenues Revenue from services $ 480,667 $ 515,275 $ (34,608 ) (7 )% Total revenues 480,667 515,275 (34,608 ) (7 )% Costs and expenses: Cost of revenue 402,109 445,827 (43,718 ) (10 )% Selling, general and administrative 205,185 202,341 2,844 1 % Research and development 2,075 2,508 (433 ) (17 )% Amortization of intangible assets 16,916 20,195 (3,279 ) (16 )% Gain on sale of assets (121,493 ) - (121,493 ) (100 )% Total costs and expenses 504,792 670,871 (166,079 ) (25 )% Loss from operations (24,125 ) (155,596 ) 131,471 84 % Revenue .
For The Years Ended December 31, 2024 and 2023 Our consolidated income (loss) from operations for the years ended December 31, 2024 and 2023 is as follows: For the years ended December 31, (In thousands) 2024 2023 Change % Change Revenues: Revenue from services $ 480,667 $ 515,275 $ (34,608 ) (7 )% Revenue from products 155,111 167,557 (12,446 ) (7 )% Revenue from transfer of intellectual property and other 77,364 180,663 (103,299 ) (57 )% Total revenues 713,142 863,495 (150,353 ) (17 )% Costs and expenses: Cost of revenue 494,632 545,368 (50,736 ) (9 )% Selling, general and administrative 304,220 300,559 3,661 1 % Research and development 105,214 89,593 15,621 17 % Contingent consideration — (1,036 ) 1,036 100 % Amortization of intangible assets 82,634 86,032 (3,398 ) (4 )% Gain on sale of assets (121,493 ) — (121,493 ) (100 )% Total costs and expenses 865,207 1,020,516 (155,309 ) (15 )% Loss from operations (152,065 ) (157,021 ) 4,956 (3 )% Diagnostics 63 Table of Contents For the years ended December 31, (In thousands) 2024 2023 Change % Change Revenues Revenue from services $ 480,667 $ 515,275 (34,608 ) (7 )% Total revenues 480,667 515,275 (34,608 ) (7 )% Costs and expenses: Cost of revenue 402,109 445,827 (43,718 ) (10 )% Selling, general and administrative 205,185 202,341 2,844 1 % Research and development 2,075 2,508 (433 ) (17 )% Amortization of intangible assets 16,916 20,195 (3,279 ) (16 )% Gain on sale of assets (121,493 ) — (121,493 ) (100 )% Total costs and expenses 504,792 670,871 (166,079 ) (25 )% Loss from operations (24,125 ) (155,596 ) 131,471 84 % Revenue .
The following table summarizes the components of our research and development expenses: Research and Development Expenses For the years ended December 31, 2024 2023 External expenses: Research and development employee-related expenses $ 1,333 $ 1,729 Other internal research and development expenses 742 779 Total research and development expenses $ 2,075 $ 2,508 The decrease in research and development expenses for the year ended December 31, 2024 was primarily due to a decrease in employee-related expenses as a result of the continued cost-reduction initiatives implemented at BioReference and the BioReference Transaction.
The following table summarizes the components of our research and development expenses: 64 Table of Contents Research and Development Expenses For the years ended December 31, 2024 2023 External expenses: Research and development employee-related expenses $ 1,333 $ 1,729 Other internal research and development expenses 742 779 Total research and development expenses $ 2,075 $ 2,508 The decrease in research and development expenses for the year ended December 31, 2024 was primarily due to a decrease in employee-related expenses as a result of the continued cost-reduction initiatives implemented at BioReference and the BioReference Transaction.
Research and Development Activities: If we are entitled to reimbursement from our customers for specified research and development expenses, we account for them as separate performance obligations if distinct. We also determine whether the research and development funding would result in revenues or an offset to research and development expenses in accordance with provisions of gross or net revenue presentation.
Research and Development Activities: If we are entitled to reimbursement from our collaborators for specified research and development expenses, we account for them as separate performance obligations if distinct. We also determine whether the research and development funding would result in revenues or an offset to research and development expenses in accordance with provisions of gross or net revenue presentation.
For the year ended December 31, 2024, we recorded $77.4 million in revenue from the transfer of intellectual property and other. Revenue for the year ended December 31, 2024 principally reflects $30.0 million from Pfizer, which includes $28.3 million from gross profit share and royalty payments for both NGENLA (somatrogon) and Pfizer's Genotropin® (somatropin).
For the year ended December 31, 2024, we recorded $77.4 million in revenue from the transfer of intellectual property and other. Revenue for the year ended December 31, 2024 principally reflects $30.0 million from Pfizer, which includes $28.3 million from gross profit share and royalty payments for both NGENLA ® and Pfizer's Genotropin®.
Actual cash flows attributed to the project are likely to be different than those assumed since projections are subjected to multiple factors including trial results and regulatory matters which could materially change the ultimate commercial success of the asset as well as significantly alter the costs to develop the respective asset into commercially viable products. 77 Table of Contents • Tax rates – The expected future income is tax effected using a market participant tax rate.
Actual cash flows attributed to the project are likely to be different than those assumed since projections are subjected to multiple factors including trial results and regulatory matters which could materially change the ultimate commercial success of the asset as well as significantly alter the costs to develop the respective asset into commercially viable products. • Tax rates – The expected future income is tax effected using a market participant tax rate.
This was primarily driven by a $90.0 million milestone payment, triggered by the FDA approval of NGENLA (somatrogon), and $26.7 million in revenue that included $22.6 million from gross profit share and royalty payments for both NGENLA (somatrogon) and Pfizer's Genotropin® (somatropin).
This was primarily driven by a $90.0 million milestone payment, triggered by the FDA approval of NGENLA ® , and $26.7 million in revenue that included $22.6 million from gross profit share and royalty payments for both NGENLA ® and Pfizer's Genotropin®.
We limit foreign currency transaction risk through hedge transactions with foreign currency forward contracts. Under these forward contracts, for any rate above or below the rate fixed by the contract, we receive or pay the difference between the spot rate and the fixed rate for the given amount at the settlement date.
We limit foreign currency transaction risk through hedge transactions with foreign currency forward contracts. Under these forward contracts, for any rate above or below the fixed rate, we receive or pay the difference between the spot rate and the fixed rate for the given amount at the settlement date.
Our future cash requirements, and the timing of those requirements, will depend on a number of factors, including the approval and success of our products and products in development, particularly our long acting Somatrogon (hGH-CTP) for which we have received approval in over 50 markets, including the United States, Europe, Japan, Australia and Canada, the commercial success of Rayaldee , BioReference’s financial performance, possible acquisitions and dispositions, the continued progress of research and development of our product candidates, the timing and outcome of clinical trials and regulatory approvals, the costs involved in preparing, filing, prosecuting, maintaining, defending, and enforcing patent claims and other intellectual property rights, the status of competitive products, the availability of financing, our success in developing markets for our product candidates and results of government investigations, payor claims, existing legal proceedings and those that may arise in the future.
Our future cash requirements, and the timing of those requirements, will depend on a number of factors, including the approval and success of our products and products in development, particularly our long acting Somatrogon (hGH-CTP) for which we have received approval in over 50 markets, including the United States, Europe, Japan, Australia and Canada, the commercial success of Rayaldee, the commercial launch of Mazdutide by our partners, BioReference’s financial performance, possible acquisitions and dispositions, the continued progress of research and development of our product candidates, the timing and outcome of clinical trials and regulatory approvals, the costs involved in preparing, filing, prosecuting, maintaining, defending, and enforcing patent claims and other intellectual property rights, the status of competitive products, the availability of financing, our success in developing markets for our product candidates and results of government investigations, payor claims, existing legal proceedings (including the ITA litigation) and those that may arise in the future.
This was partially offset by continued cost-reduction initiatives at BioReference, which included a reduction in employee headcount and the streamlining of certain smaller operations, resulting in an overall decrease in employee-related expenses and other operating efficiencies. The divestiture of certain laboratory operations also contributed to the reduction in employee-related expenses. 65 Table of Contents Research and development expenses .
This was partially offset by continued cost-reduction initiatives at BioReference, which included a reduction in employee headcount and the streamlining of certain smaller operations, resulting in an overall decrease in employee-related expenses and other operating efficiencies. The divestiture of certain laboratory operations also contributed to the reduction in employee-related expenses. Research and development expenses .
Revenue in 2024 also included $23.8 million from the BARDA Contract, a $12.5 million milestone payment from Merck, and $10.2 million from contract manufacturers' commercial milestones. 66 Table of Contents In comparison, for the year ended December 31, 2023, we recorded $180.7 million in revenue from the transfer of intellectual property and other.
Revenue in 2024 also included $23.8 million from the BARDA Contract, a $12.5 million milestone payment from Merck, and $10.2 million from contract manufacturers' commercial milestones. In comparison, for the year ended December 31, 2023, we recorded $180.7 million in revenue from the transfer of intellectual property and other.
Considering the high risk nature of research and development and the industry’s success rate of bringing developmental compounds to market, IPR&D impairment charges may occur in future periods. Estimating the fair value of IPR&D for potential impairment is highly sensitive to changes in projections and assumptions and changes in assumptions could potentially lead to impairment.
Considering the high risk nature of research and development and the industry’s success rate of bringing developmental compounds to market, IPR&D impairment charges 71 Table of Contents may occur in future periods. Estimating the fair value of IPR&D for potential impairment is highly sensitive to changes in projections and assumptions and changes in assumptions could potentially lead to impairment.
Billings for services are included in revenue net of allowances for contractual discounts, allowances for differences between the amounts billed and estimated program payment amounts, and implicit price concessions provided to uninsured patients which are all elements of variable consideration. 78 Table of Contents The following are descriptions of our payors for laboratory services: Healthcare Insurers.
Billings for services are included in revenue net of allowances for contractual discounts, allowances for differences between the amounts billed and estimated program payment amounts, and implicit price concessions provided to uninsured patients which are all elements of variable consideration. The following are descriptions of our payors for laboratory services: Healthcare Insurers.
We assess if these options provide a material right to the licensee and if so, they are accounted for as separate performance obligations at the inception of the contract and revenue is recognized only if the option is exercised and products or services are subsequently delivered or when the rights expire.
We assess if these options provide a material right to the licensee and if so, they are accounted for as separate performance obligations at the 74 Table of Contents inception of the contract and revenue is recognized only if the option is exercised and products or services are subsequently delivered or when the rights expire.
In 2023, revenue also included $50.0 million from Merck in consideration for the rights granted to Merck under the Merck Agreement, $7.0 million from VFMCRP triggered by the German price approval for Rayaldee , $2.5 million from Nicoya due to Nicoya's submission of the investigational new drug application to China's Center for Drug Evaluation, $2.4 million from contract manufacturers' commercial milestones and $1.2 million from the BARDA Contract.
In 2023, revenue also included $50.0 million from Merck in consideration for the rights granted to Merck under the Merck Agreement, $7.0 million from VFMCRP triggered by the German price approval for Rayaldee , $2.5 million from Nicoya due to Nicoya's submission of the investigational new drug application to China's Center for Drug Evaluation, $2.4 million from contract manufacturers' commercial milestones and $1.2 million from the BARDA Contract. 65 Table of Contents Cost of revenue .
Under this program, we may repurchase shares through various methods, including open market purchases, block trades, privately negotiated transactions and accelerated share repurchases, as well as pursuant to pre-set trading plans meeting the requirements of Rule 10b5-1(c) of the Exchange Act, and otherwise in compliance with applicable laws.
Under this program, the Company may repurchase shares from time to time through various methods, including open market purchases, block trades, privately negotiated transactions, accelerated share repurchases, as well as pursuant to pre-set trading plans meeting the requirements of Rule 10b5-1(c) of the Exchange Act, and otherwise in compliance with applicable laws.
The following table provides information as of December 31, 2024, with respect to the amounts and timing of our known contractual obligation payments due by period.
The following table provides information as of December 31, 2025, with respect to the amounts and timing of our known contractual obligation payments due by period.
Gross accumulated currency translation adjustments recorded as a separate component of shareholders’ equity were $52.7 million and $34.6 million at December 31, 2024 and 2023, respectively. We are subject to foreign currency translation risk for fluctuations in exchange rates during the period of time between the consummation and cash settlement of transactions.
Gross accumulated currency translation adjustments recorded as a separate component of shareholders’ equity were $17.6 million and $52.7 million at December 31, 2025 and 2024, respectively. We are subject to foreign currency translation risk for fluctuations in exchange rates during the period of time between the consummation and cash settlement of transactions.
Our financial statements are reported in USD; therefore, fluctuations in exchange rates affect the translation of revenues and expenses denominated in foreign currencies into USD for purposes of reporting our consolidated financial results. During the years ended December 31, 2024, 2023 and 2022, the most significant currency exchange rate exposures were to the Chilean Peso and Euro.
Our financial statements are reported in USD and, accordingly, fluctuations in exchange rates affect the translation of revenues and expenses denominated in foreign currencies into USD for purposes of reporting our consolidated financial results. During the years ended December 31, 2025, 2024 and 2023, the most significant currency exchange rate exposures were to the Chilean Peso and Euro.
We recorded no contingent consideration for the year ended December 31, 2024. 67 Table of Contents Amortization of intangible assets . Amortization of intangible assets was $65.7 million and $65.8 million, respectively, for the years ended December 31, 2024 and 2023. Amortization expense reflects the amortization of acquired intangible assets with defined useful lives.
We recorded no contingent consideration for the year ended December 31, 2024. Amortization of intangible assets . Amortization of intangible assets was $65.7 million and $65.8 million, respectively, for the years ended December 31, 2024 and 2023. Amortization expense reflects the amortization of acquired intangible assets with defined useful lives.
As of December 31, 2024 and 2023, we have liabilities of approximately $2.0 million and $3.1 million within Accrued expenses and Other long-term liabilities related to reimbursements for payor overpayments. Revenue from products. We recognize revenue from product sales when a customer obtains control of promised goods or services.
As of December 31, 2025 and 2024, we have liabilities of approximately $2.1 million and $2.0 million, respectively, within Accrued expenses and Other long-term liabilities related to reimbursements for payor overpayments. Revenue from products. We recognize revenue from product sales when a customer obtains control of promised goods or services.
Implicit price concessions represent differences between amounts billed and the estimated consideration that we expect to receive from patients, which considers historical collection experience and other factors including current market conditions. Adjustments to the estimated allowances, based on actual receipts from the patients, are recorded upon settlement.
Implicit price concessions represent differences between amounts billed and the estimated consideration that we expect to receive from patients, which considers historical collection experience and other 72 Table of Contents factors including current market conditions. Adjustments to the estimated allowances, based on actual receipts from the patients, are recorded upon settlement.
We believe that cash, cash equivalents and restricted cash on hand at December 31, 2024 are sufficient to meet our anticipated cash requirements for operations and debt service beyond the next 12 months.
We believe that the cash, cash equivalents and restricted cash on hand on December 31, 2025 are sufficient to meet our anticipated cash requirements for operations and debt service beyond the next 12 months.
For the year ended December 31, 2024, the tax rate differed from the U.S. federal statutory rate of 21% primarily due to the relative mix in earnings and losses in the U.S. versus foreign tax jurisdictions, impact related to the BioReference Transaction, the impact of the payments under Merck Agreement, the impact of sales of the GeneDx investment, and operating results in tax jurisdictions which do not result in a tax benefit. 68 Table of Contents Loss from investments in investees .
For the year ended December 31, 2024, the tax rate differed from the U.S. federal statutory rate of 21% primarily due to the relative mix in earnings and losses in the U.S. versus foreign tax jurisdictions, impact related to the BioReference Transaction, the impact of the payments under Merck Agreement, the impact of sales of the GeneDx investment, and operating results in tax jurisdictions which do not result in a tax benefit.
Goodwill was $529.3 million and $598.3 million at December 31, 2024 and 2023, respectively. Estimating the fair value of a reporting unit for goodwill impairment is highly sensitive to changes in projections and assumptions and changes in assumptions could potentially lead to impairment.
Goodwill was $484.3 million and $529.3 million at December 31, 2025 and 2024, respectively. Estimating the fair value of a reporting unit for goodwill impairment is highly sensitive to changes in projections and assumptions and changes in assumptions could potentially lead to impairment.
We anticipate further legislative activity and administrative guidance in 2025, and will continue to evaluate the impacts of enacted legislation and pending legislation to enact Pillar Two Model Rules in the non-US tax jurisdictions we operate in.
We anticipate further legislative activity and administrative guidance, and will continue to evaluate the impacts of enacted legislation and pending legislation to enact Pillar Two Model Rules in the non-US tax jurisdictions we operate in. 77 Table of Contents
RESULTS OF OPERATIONS Foreign Currency Exchange Rates For the years ended December 31, 2024, 2023, and 2022, approximately 23.1%, 29.6%, and 21.6% of revenue, respectively, was denominated in currencies other than the U.S. Dollar (USD).
RESULTS OF OPERATIONS Foreign Currency Exchange Rates For the years ended December 31, 2025, 2024, and 2023, approximately 28.0%, 23.1%, and 29.6% of revenue, respectively, was denominated in currencies other than the U.S. Dollar (USD).
Our indefinite lived IPR&D assets will not be amortized until the underlying development programs are completed. Upon obtaining regulatory approval, IPR&D assets will be accounted for as a finite-lived intangible asset and amortized on a straight-line basis over its estimated useful life of approximately 12 years.
Amortization expense reflects the amortization of acquired intangible assets with defined useful lives. Our indefinite lived IPR&D assets will not be amortized until the underlying development programs are completed. Upon obtaining regulatory approval, IPR&D assets will be accounted for as a finite-lived intangible asset and amortized on a straight-line basis over its estimated useful life of approximately 12 years.
At December 31, 2024 and 2023, receivable balances (net of explicit and implicit price concessions) from Medicare and Medicaid were 4.8% and 6.7%, respectively, of our consolidated Accounts receivable, net. The portion of our accounts receivable due from individual patients comprises the largest portion of credit risk.
At December 31, 2025 and 2024, receivable balances (net of explicit and implicit price concessions) from Medicare and Medicaid were 5.2% and 4.8%, respectively, of our consolidated Accounts receivable, net. The portion of our accounts receivable due from individual patients comprises the largest portion of credit risk.
Cash used in operations of $183.5 million for year ended December 31, 2024 principally reflects general and administrative expenses related to our corporate operations, research and development activities and sales and marketing activities related to our pharmaceutical and diagnostic business.
Cash used in operations of $178.5 million for year ended December 31, 2025 principally reflected general and administrative expenses related to our corporate operations, research and development activities and sales and marketing activities related to our pharmaceutical and diagnostic business.
The corresponding revenues or offset to research and development expenses are recognized as the related performance obligations are satisfied. BARDA Contract: Revenue from the BARDA contract is generated under terms that are cost plus fee. We recognize revenue using the incurred costs output method to measure progress.
The corresponding revenues or offset to research and development expenses are recognized as the related performance obligations are satisfied. BARDA Contract (as defined in Note 16 of the Consolidated Financial Statements): Revenue from the BARDA Contract is generated under terms that are cost plus fee. We recognize revenue using the incurred costs output method to measure progress.
These lines of credit are short-term and are used primarily as a source of working capital. The highest aggregate principal balance at any time outstanding during the year ended December 31, 2024, was $23.6 million. We intend to continue to draw on these lines of credit as needed.
These lines of credit are short-term and are used primarily as a source of working capital. The highest aggregate principal balance at any time outstanding during the year ended December 31, 2025 was $14.3 million. We intend to continue to draw under these lines of credit as needed.
Our diagnostics business, BioReference Health, LLC (“BioReference”), is a highly specialized laboratory in the United States, with a sales and marketing team focused on growth and new product integration, including the 4Kscore ® prostate cancer test.
Our diagnostics business, BioReference Health, LLC (“BioReference”), is a highly specialized laboratory in the United States, with a sales and marketing team focused on growth and new product integration, including the 4Kscore® test which is designed to assesses a patient's probability for prostate cancer.
ITEM 7. MANAGEMENT ’ S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
ITEM 7. MANAG EMENT ’ S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
Income taxes. Income taxes are accounted for under the asset-and-liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and the respective tax bases and for operating loss and tax credit carryforwards.
Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and the respective tax bases and for operating loss and tax credit carryforwards.
For the years ended December 31, 2024, 2023 and 2022, we recognized $29.0 million, $31.0 million and $27.2 million in net product revenue from sales of Rayaldee . Taxes collected from customers related to revenues from services and revenues from products are excluded from revenues. Revenue from intellectual property.
For the years ended December 31, 2025, 2024 and 2023, we recognized $29.8 million, $29.0 million and $31.0 million, respectively, in net product revenue from sales of Rayaldee . Taxes collected from customers related to revenues from services and revenues from products are excluded from revenues. 73 Table of Contents Revenue from intellectual property.
As of December 31, 2024, the total commitments under our lines of credit with financial institutions in Chile and Spain were $30.8 million, of which $13.5 million was drawn as of December 31, 2024. At December 31, 2024, the weighted average interest rate on these lines of credit was approximately 5.52%.
As of December 31, 2025, the total commitments under our lines of credit with financial institutions in Chile and Spain were $30.4 million, of which $8.5 million was drawn as of December 31, 2025. On December 31, 2025, the weighted 68 Table of Contents average interest rate on these lines of credit was approximately 5.5%.
Under the terms of the VFMCRP Agreement, we are entitled to receive up to an additional $15 million in regulatory milestones and $200 million in milestone payments tied to the launch, pricing and sales of Rayaldee , including a $7 million regulatory milestone payment we recorded in the first quarter of 2023 triggered by the German price approval for Rayaldee and $3 million regulatory milestone payment we recognized in 2022 following the first sale of Rayaldee in Europe.
VFMCRP Agreement: • Entitled to receive up to an additional $15 million in regulatory milestones. • Entitled to receive $200 million in milestone payments tied to the launch, pricing, and sales of Rayaldee . • Received a $7 million regulatory milestone payment in the first quarter of 2023, triggered by the German price approval for Rayaldee . • Recognized a $3 million regulatory milestone payment in 2022 following the first sale of Rayaldee in Europe. • Eligible to receive tiered, double-digit royalty payments.
Subsequent to acquisition, goodwill and indefinite lived intangible assets are tested at least annually as of October 1 for impairment, or when events or changes in circumstances indicate it is more likely than not that the carrying amount of such assets may not be recoverable.
At acquisition, we generally determine the fair value of intangible assets, including IPR&D, using the “income method.” Subsequent to acquisition, goodwill and indefinite lived intangible assets are tested at least annually as of October 1 for impairment, or when events or changes in circumstances indicate it is more likely than not that the carrying amount of such assets may not be recoverable.
Loss from investments in investees . We have made investments in certain early stage companies that we believe have valuable proprietary technology and significant potential to create value for us as a shareholder or member.
Loss from investments in investees . We have invested in certain early stage companies that we believe have valuable proprietary technology and significant potential to create value for us as an equity holder.
As the government has access to development research, it benefits incrementally as R&D activities occur. Revenue will only be recognized when research and development services are performed to the extent of actual costs incurred. Sales-based Milestone and Royalty Payments: Our customers may be required to pay us sales-based milestone payments or royalties on future sales of commercial products.
Revenue will only be recognized when research and development services are performed to the extent of actual costs incurred. Sales-based Milestone and Royalty Payments: Our collaborators may be required to pay us sales-based milestone payments or royalties on future sales of commercial products.
If the combined performance obligation is satisfied over time, we apply an appropriate method of measuring progress for purposes of recognizing revenue from nonrefundable, upfront license fees.
If the combined performance obligation is satisfied over time, we apply an appropriate method of measuring progress for purposes of recognizing revenue from nonrefundable, upfront license fees. We evaluate the measure of progress each reporting period and, if necessary, adjust the measure of performance and related revenue recognition.
We may have an obligation to reimburse Medicare, Medicaid, and third-party payors for overpayments regardless of fault.
We may have an obligation to reimburse Medicare, Medicaid, and third-party payors for overpayments regardless of fault. We have periodically identified and reported overpayments, reimbursed payors for overpayments and taken appropriate corrective action.
We have periodically identified and reported overpayments, reimbursed payors for overpayments and taken appropriate corrective action. 79 Table of Contents Settlements with third-party payors for retroactive adjustments due to audits, reviews or investigations are also considered variable consideration and are included in the determination of the estimated transaction price for providing services.
Settlements with third-party payors for retroactive adjustments due to audits, reviews or investigations are also considered variable consideration and are included in the determination of the estimated transaction price for providing services.
Fair value changes of derivative instruments, net for the years ended December 31, 2023 and 2022 were $0.8 million of expense and $0.7 million reversal of expense, respectively. Derivative expense for the years ended December 31, 2023 and 2022 was principally related to the change in fair value on foreign currency forward exchange contracts at OPKO Chile.
Fair value changes of derivative instruments, net for the years ended December 31, 2025 and 2024 were $0.4 million of expense and $26.2 million reversal of expense, respectively. Derivative 62 Table of Contents expense was principally related to the change in fair value of the 2029 Convertible Notes and of foreign currency forward exchange contracts at OPKO Chile.
Various countries have enacted or have announced plans to enact new tax laws to implement the global minimum tax. We considered the applicable tax law changes on Pillar Two implementation in the relevant countries, and there is no material impact to our tax results for the period.
We considered the applicable tax law changes on Pillar Two implementation in the relevant countries, and there is no material impact to our tax results for the period.
On January 7, 2025, ModeX announced the dosing of the first participant in a Phase 1 study for an EBV vaccine candidate being developed in collaboration with Merck which triggered a $12.5 million milestone payment from Merck under the Merck Agreement.
(as defined in the Merck Agreement) • On January 7, 2025, a $12.5 million milestone payment was triggered by the dosing of the first participant in a Phase 1 study for an EBV vaccine candidate.
Loss from investments in investees was $0.1 million and $0.4 million for the years ended December 31, 2023 and 2022, respectively. LIQUIDITY AND CAPITAL RESOURCES At December 31, 2024, we had cash, cash equivalents and restricted cash of approximately $445.6 million.
Loss from investments in investees was $18.0 thousand and $107.0 thousand for the years ended December 31, 2024 and 2023, respectively. 67 Table of Contents LIQUIDITY AND CAPITAL RESOURCES At December 31, 2025, we had cash, cash equivalents and restricted cash of approximately $382.7 million.
Inventory obsolescence expense for the years ended December 31, 2024, 2023 and 2022 was $2.1 million, $8.1 million and $4.1 million, respectively. 82 Table of Contents RECENT ACCOUNTING PRONOUNCEMENTS Accounting standards yet to be adopted In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”), which modifies the rules on income tax disclosures to require entities to disclose (i) specific categories in the rate reconciliation, (ii) the income or loss from continuing operations before income tax expense or benefit (separated between domestic and foreign) and (iii) income tax expense or benefit from continuing operations (separated by federal, state and foreign).
In December 2023, the FASB issued ASU No. 2023-09, “Income Taxes (Topic 740): Improvements to Income Tax Disclosures” (“ASU 2023-09”), which modifies the rules on income tax disclosures to require entities to disclose (i) specific categories in the rate reconciliation, (ii) the income or loss from continuing operations before income tax expense or benefit (separated between domestic and foreign) and (iii) income tax expense or benefit from continuing operations (separated by federal, state and foreign).
BioReference® offers a broad spectrum of diagnostic testing services for oncology, urology ( 4Kscore ), and corrections nationwide, setting new standards with our industry-leading turnaround times. BioReference also provides comprehensive clinical and women’s health testing in New York and New Jersey.
BioReference® offers a broad spectrum of diagnostic testing services for urology (4Kscore), and corrections nationwide, setting new standards with its industry-leading turnaround times. BioReference also provides comprehensive clinical and women’s health testing in New York and New Jersey. Our test offerings are backed by a team of board-certified medical professionals and driven by the latest healthcare guidelines and standards.
The timing and volume of repurchases will depend on market conditions, our capital management, investment opportunities, and other factors. The program does not obligate us to repurchase any specific number of shares, has no set expiration date, and may be modified, suspended, or discontinued at our discretion.
The timing and amount of any repurchases is subject to general market conditions, the Company's capital management, investment opportunities, and other factors. The repurchase program does not obligate the Company to repurchase any specific number of shares, has no time limit, and may be modified, suspended, or discontinued at any time at the Company's discretion.
Actual results could differ significantly from these estimates. Goodwill and intangible assets. Goodwill, IPR&D and other intangible assets acquired in business combinations, licensing and other transactions was $1.3 billion and $1.5 billion at December 31, 2024 and 2023, respectively.
Actual results could differ significantly from these estimates. 70 Table of Contents Goodwill and intangible assets. Goodwill, in-process research and development (“IPR&D”) and other intangible assets acquired in business combinations, licensing and other transactions was $1.2 billion and $1.3 billion at December 31, 2025 and 2024, respectively.
Corporate For the years ended December 31, (In thousands) 2024 2023 Change % Change Costs and expenses: Selling, general and administrative $ 41,028 $ 42,531 $ (1,503 ) (4 )% Research and development 117 78 39 50 % Total costs and expenses 41,145 42,609 (1,464 ) (3 )% Loss from operations $ (41,145 ) $ (42,609 ) $ 1,464 3 % Operating loss for our unallocated corporate operations for the years ended December 31, 2024 and 2023 was $41.4 million and $42.6 million, respectively, and principally reflect general and administrative expenses incurred in connection with our corporate operations.
Corporate For the years ended December 31, (In thousands) 2025 2024 Change % Change Costs and expenses: Selling, general and administrative $ 39,835 $ 41,028 $ (1,193 ) (3 )% Research and development 491 117 374 320 % Total costs and expenses 40,326 41,145 (819 ) (2 )% Loss from operations $ (40,326 ) $ (41,145 ) $ 819 2 % Operating loss for our unallocated corporate operations for the years ended December 31, 2025 and 2024 was $40.3 million and $41.1 million, respectively, and principally reflects general and administrative expenses incurred in connection with our corporate operations.
Furthermore, as a result of our sale of GeneDx in April 2022, genomic test revenues decreased by $48.3 million for the year ended December 31, 2023. 69 Table of Contents Estimated collection amounts are subject to the complexities and ambiguities of billing, reimbursement regulations and claims processing, as well as considerations unique to Medicare and Medicaid programs, and require us to consider the potential for retroactive adjustments when estimating variable consideration in the recognition of revenue for the period in which the related services are rendered.
Estimated collection amounts are subject to the complexities and ambiguities of billing, reimbursement regulations and claims processing, as well as considerations unique to Medicare and Medicaid programs, and require us to consider the potential for retroactive adjustments when estimating variable consideration in the recognition of revenue for the period in which the related services are rendered.
For the year ended December 31, 2024, and 2023, negative revenue adjustments due to changes in estimates of implicit price concessions for performance obligations satisfied in prior periods of $1.5 million and $19.2 million, respectively, were recognized.
For the years ended December 31, 2025 and 2024, we recorded $1.3 million and $1.5 million, respectively, of negative revenue adjustments due to changes in estimates of implicit price concessions for performance obligations satisfied in prior periods mainly due to the composition of patient payer mix.
We also manufacture and sell Rayaldee , an FDA approved treatment for secondary hyperparathyroidism (“SHPT”) in adults with stage 3 or 4 chronic kidney disease (“CKD”) and vitamin D insufficiency, through our pharmaceutical division. We have also expanded our pharmaceutical pipeline with early-stage immune therapies targeting cancer and infectious diseases through our 2022 acquisition of ModeX Therapeutics, Inc. (“ModeX”).
Also, through our pharmaceutical business, we manufacture and sell Rayaldee , an FDA approved treatment for secondary hyperparathyroidism (“SHPT”) in adults with stage 3 or 4 chronic kidney disease (“CKD”) and vitamin D insufficiency. Our subsidiary, ModeX Therapeutics, Inc. (“ModeX”), is a biotechnology company focused on developing innovative multi-specific immune therapies for cancer and infectious disease candidates.
(“Pfizer”) for the development and commercialization of Somatrogon (hGH-CTP). Regulatory approvals for Somatrogon (hGH-CTP) for the treatment of growth hormone deficiency in children and adolescents have been secured in more than 50 markets, including the United States, European Union (“EU”) Member States, Japan, Canada, and Australia, where it is marketed under the brand name NGENLA®.
Regulatory approvals for Somatrogon (hGH-CTP) for the treatment of children and adolescents, as young as three years of age, with growth disturbance due to insufficient secretion of growth hormone, have been secured in more than 50 markets worldwide, including in the United States, European Union Member States, Japan, Canada, and Australia under the brand name NGENLA®.
We evaluate the measure of progress each reporting period and, if necessary, adjust the measure of performance and related revenue recognition. 80 Table of Contents Development and Regulatory Milestone Payments: Depending on facts and circumstances, we may conclude that it is appropriate to include the milestone in the estimated transaction price or that it is appropriate to fully constrain the milestone.
Development and Regulatory Milestone Payments: Depending on facts and circumstances, we may conclude that it is appropriate to include the milestone in the estimated transaction price or that it is appropriate to fully constrain the milestone.
For the years ended December 31, 2023, and 2022, negative revenue adjustments due to changes in estimates of implicit price concessions for performance obligations satisfied in prior periods of $19.2 million and $21.5 million, respectively, were recognized.
For the years ended December 31, 2025 and 2024, we recorded $1.3 million and $1.5 million, respectively, of negative revenue adjustments due to changes in estimates of implicit price concessions for performance obligations satisfied in prior periods mainly due to the composition of patient payer mix.
For the year ended December 31, 2023, the tax rate differed from the U.S. federal statutory rate of 21% primarily due to the relative mix in earnings and losses in the U.S. versus foreign tax jurisdictions, the impact of the payments under the Merck Agreement, and operating results in tax jurisdictions which do not result in a tax benefit.
While the U.S. federal statutory income tax rate is 21%, our consolidated effective tax rate for both periods differed from this rate primarily due to the relative mix of earnings and losses generated in the U.S. versus foreign tax jurisdictions, as well as the operating results in tax jurisdictions which do not result in a tax benefit.
We assess the collectability of accounts receivable balances by considering factors such as historical collection experience, customer credit worthiness, the age of accounts receivable balances, regulatory changes and current economic conditions and trends that may affect a customer’s ability to pay. Actual results could differ from those estimates.
At December 31, 2025 and 2024, receivables due from patients represented approximately 1.5% and 1.7%, respectively, of our consolidated accounts receivable, net. 75 Table of Contents We assess the collectability of accounts receivable balances by considering factors such as historical collection experience, customer credit worthiness, the age of accounts receivable balances, regulatory changes and current economic conditions and trends that may affect a customer’s ability to pay.
If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, then an impairment charge is recognized for the amount by which the carrying amount of the asset exceeds the fair value of the asset.
This assessment involves comparing the carrying amount of an asset, which is its cost minus accumulated amortization, to its estimated future undiscounted cash flows. If an asset's carrying amount exceeds its estimated future cash flows, then an impairment charge is recognized to reflect the difference between the asset's carrying amount and its fair value.
Revenue for laboratory services is recognized at the time test results are reported, which approximates when services are provided and the performance obligations are satisfied. Services are provided to patients covered by various third-party payor programs including various managed care organizations, as well as the Medicare and Medicaid programs.
Services are provided to patients covered by various third-party payor programs including various managed care organizations, as well as the Medicare and Medicaid programs.
Other income (expense), net . Other income (expense), net for the years ended December 31, 2023 and 2022, was $17.0 million and $155.8 million of expense, respectively.
Other income (expense), net . Other income (expense), net for the years ended December 31, 2025 and 2024, was ($29.9) million of expense and $206.9 million of income, respectively.
ASU 2023-09 should be applied on a prospective basis, but retrospective application is permitted. We are currently evaluating the potential impact of adopting this new guidance on our consolidated financial statements and related disclosures. Recently adopted accounting standards In November 2023, the FASB issued ASU No 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”).
ASU 2023-09 should be applied on a prospective basis, but retrospective application is permitted. We are currently evaluating the potential impact of adopting this new guidance on our consolidated financial statements and related disclosures. 76 Table of Contents In November 2024, the FASB issued ASU 2024-04, Debt (Subtopic 470-20): Debt with Conversion and Other Options.
Net intangible assets other than goodwill were $811.6 million and $935.3 million at December 31, 2024 and 2023, respectively, including IPR&D of $195.0 million at December 31, 2024 and 2023. Intangible assets are highly vulnerable to impairment charges, particularly newly acquired assets for recently launched products and IPR&D.
Net intangible assets other than goodwill were $711.3 million and $811.6 million at December 31, 2025 and 2024, respectively, including IPR&D of $195.0 million at December 31, 2025 and 2024.
On December 15, 2022, the EU member states agreed to implement the OECD’s global minimum tax rate of 15%. The OECD issued Pillar Two model rules and continues to release guidance on these rules. The inclusive framework calls for tax law changes by participating countries to take effect in 2025.
On December 15, 2022, the EU member states agreed to implement the OECD’s global minimum tax rate of 15%. The OECD issued Pillar Two model rules and continues to release guidance on these rules. Various participating countries have enacted or have announced plans to enact new tax laws to implement the global minimum tax, some effective beginning in 2024.
We have invested in certain early stage companies that we believe have valuable proprietary technology and significant potential to create value for us as an equityholder. We account for these investments under the equity method of accounting, resulting in the recording of our proportionate share of their losses until our share of their loss exceeds our investment.
Loss from investments in investees . We have invested in certain early stage companies that we believe have valuable proprietary technology and significant potential to create value for us as an equity holder.
Upon obtaining regulatory approval, IPR&D assets are then accounted for as a finite-lived intangible asset and amortized on a straight-line basis over its estimated useful life. If the project is abandoned, the IPR&D asset is charged to expense.
Upon regulatory approval, IPR&D assets are classified as finite-lived intangible assets. These assets are then amortized on a straight-line basis over their estimated useful lives. If a project is abandoned, the associated IPR&D costs are immediately expensed. We also regularly assess finite-lived intangible assets for impairment.
Cash provided by investing activities was $352.2 million for the year ended December 31, 2024 primarily reflected both the proceeds from the BioReference Transaction and the sale of equity securities, offset by capital expenditures.
Cash provided by investing activities was $230.3 million for the year ended December 31, 2025, primarily reflecting $197.8 million in total proceeds from the BioReference Transaction and Oncology Transaction, inclusive of escrow released, and $52.2 million from the sale of equity securities, offset by a $7.7 million investment in Entera and $13.0 million in capital expenditures.
Selling, general and administrative expenses . Selling, general and administrative expenses for the years ended December 31, 2023 and 2022 were $55.7 million and $49.2 million, respectively, representing an increase of 13% from the prior year period.
Selling, general and administrative expenses . Selling, general and administrative expenses for the years ended December 31, 2025 and 2024 were $129.3 million and $205.2 million, respectively, representing a decrease of 37.0% from the prior year.
The allowance for credit losses was $1.3 million and $2.0 million at December 31, 2024 and 2023, respectively. The credit loss expense for the years ended December 31, 2024, 2023 and 2022 was $0.1 million, $0.3 million and $0.3 million, respectively. Accounts receivable as of December 31, 2024 included $3.6 million of government contract revenue earned under the BARDA contract.
Accounts receivable as of December 31, 2025 and 2024 included $2.3 million and $3.6 million, respectively, of government contract revenue earned under the BARDA Contract. Income taxes. Income taxes are accounted for under the asset-and-liability method.
Until the investees’ technologies are commercialized, if ever, we anticipate they will report net losses. Loss from investments in investees was $18.0 thousand and $107.0 thousand for the years ended December 31, 2024 and 2023, respectively.
Loss from investments in investees was $29.0 thousand and $18.0 thousand for the years ended December 31, 2025 and 2024, respectively.
There is no assurance that these lines of credit or other funding sources will be available to us on acceptable terms, or at all, in the future. Separately, on September 16, 2024, BioReference fully repaid its obligations and terminated the BioReference Credit Agreement.
There is no assurance that these lines of credit or other funding sources will be available to us on acceptable terms, or at all, in the future. Our liquidity would be impacted by the successful achievement of various milestones and the generation of royalty revenues under our existing collaboration and licensing agreements.
Cash provided by financing activities of $184.2 million primarily reflected the issuance of our 2029 Convertible Notes and the issuance of the 2044 Notes, which was partially offset by the redemption of the 2025 Notes, repurchase of shares of our Common Stock, and net repayments on our lines of credit.
Cash used in financing activities of $118.1 million primarily reflected both the repurchase of Common Stock for $47.0 million and the 2029 Convertible 144A Notes for $62.2 million, as well as net repayments on our lines of credit of $7.9 million.
Labcorp paid to the Company aggregate consideration of $237.5 million in cash, subject to certain adjustments as set forth in the Labcorp Asset Purchase Agreement. The assets acquired by Labcorp included BioReference's laboratory testing businesses focused on clinical diagnostics, reproductive health, and women's health across the United States, excluding New York and New Jersey.
Labcorp acquired select assets of BioReference (the “BioReference Transaction”), which were part of our diagnostics segment and included BioReference's laboratory testing businesses focused on clinical diagnostics, reproductive health, and women's health across the United States, excluding BioReference's New York and New Jersey operations.
In addition, we are eligible to receive regional, tiered gross profit sharing for both Somatrogon (hGH-CTP) and Pfizer’s Genotropin®.
Restated Pfizer Agreement: • Eligible to receive an additional $50.0 million in regulatory milestones. • Eligible to receive regional, tiered gross profit sharing for both NGENLA ® and Pfizer’s Genotropin®.
Under the terms of the Merck Agreement, we received an initial payment of $50.0 million and are also eligible to receive up to an additional $860.0 million upon the achievement of certain commercial and development milestones under several indications.
As of December 31, 2025, the historical and potential payments from these agreements were as follows: Merck Agreement: • Received an initial payment of $50.0 million. • Eligible for up to an additional $860.0 million upon achieving certain commercial and development milestones under several indications. • Potential for tiered royalty payments ranging from high single digits to low double digits upon achieving certain sales targets of the Product.
We amortize intangible assets with definite lives on a straight-line basis over their estimated useful lives, ranging from 3 to 20 years. We use the straight-line method of amortization as there is no reliably determinable pattern in which the economic benefits of our intangible assets are consumed or otherwise used up.
We use the straight-line method of amortization as there is no reliably determinable pattern in which the economic benefits of our intangible assets are consumed or otherwise used up. Amortization expense was $77.9 million, $82.6 million and $86.0 million for the years ended December 31, 2025, 2024 and 2023, respectively. Revenue recognition .

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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 changeOur financial statements are reported in USD and, accordingly, fluctuations in exchange rates will affect the translation of revenues and expenses denominated in foreign currencies into USD for purposes of reporting our consolidated financial results. During the years ended December 31, 2024 and 2023, the most significant currency exchange rate exposures were to the Chilean Peso and Euro.
Biggest changeFor the years ended December 31, 2025, 2024, and 2023, approximately 28.0%, 23.1%, and 29.6% of revenue was denominated in currencies other than the USD. Our financial statements are reported in USD and, accordingly, fluctuations in exchange rates will affect the translation of revenues and expenses denominated in foreign currencies into USD for purposes of reporting our consolidated financial results.
For information on such open foreign exchange forward contracts for the years ended December 31, 2024 and 2023 see “Management’s Discussion and Analysis—Results of Operations— Foreign Currency Exchange Rates.” We do not engage in trading market risk sensitive instruments or purchasing hedging instruments or “other than trading” instruments that are likely to expose us to significant market risk, whether interest rate, foreign currency exchange, commodity price, or equity price risk.
For information on such open foreign exchange forward contracts for the years ended December 31, 2025 and 2024 see “Management’s Discussion and Analysis—Results of Operations— Foreign Currency Exchange Rates.” We do not engage in trading market risk sensitive instruments or purchasing hedging instruments or “other than trading” instruments that are likely to expose us to significant market risk, whether interest rate, foreign currency exchange, commodity price, or equity price risk.
Based on our outstanding balances at December 31, 2024, if our applicable interest rates on our variable rate debt increase by 1%, then our debt service on an annual basis would increase by approximately $2.5 million. Our other outstanding convertible senior notes have fixed rates of interest; therefore, we are not exposed to interest rate risk on those instruments.
Based on our outstanding balances at December 31, 2025, if our applicable interest rates on our variable rate debt increase by 1%, then our debt service on an annual basis would increase by approximately $2.5 million. Our other outstanding convertible senior notes have fixed rates of interest; therefore, we are not exposed to interest rate risk on those instruments.
To minimize the exposure due to adverse shifts in interest rates, we maintain investments at an average maturity of generally less than three months. 84 Table of Contents
To minimize the exposure due to adverse shifts in interest rates, we maintain investments at an average maturity of generally less than three months. 79 Table of Contents
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK In the normal course of doing business, we are exposed to the risks associated with foreign currency exchange rates and changes in interest rates.
ITEM 7A. QUANT ITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK In the normal course of doing business, we are exposed to the risks associated with foreign currency exchange rates and changes in interest rates.
Government and its agencies, bank obligations, repurchase agreements and high-quality corporate issuers, and money market funds that invest in such debt instruments, and, by policy, restrict our exposure to any single corporate issuer by imposing concentration limits.
Government and its agencies, bank obligations, repurchase agreements and high-quality corporate issuers, and money market funds that invest in such debt instruments, and, by policy, restrict our exposure to any single corporate issuer by imposing 78 Table of Contents concentration limits.
We currently do not hedge interest rate exposure. Because of the short-term maturities of our investments, we do not believe that a change in market interest rates would have a significant negative impact on the value of our investment portfolio except for reduced interest income. At December 31, 2024, we had cash, cash equivalents and restricted cash of $445.6 million.
We currently do not hedge interest rate exposure. Because of the short-term maturities of our investments, we do not believe that a change in market interest rates would have a significant negative impact on the value of our investment portfolio except for reduced interest income. At December 31, 2025, we had cash, cash equivalents and restricted cash of $382.7 million.
As of December 31, 2024, the principal outstanding balance under our 2044 Notes, which accrue interest at the 3-month SOFR, was $250.0 million at a weighted average interest rate of approximately 12.98%.
As of December 31, 2025, the principal outstanding balance under our 2044 Notes, which accrue interest at the 3-month SOFR, was $250.0 million at a weighted average interest rate of approximately 12.11%.
The weighted average interest rate related to our cash, cash equivalents and restricted cash for the year ended December 31, 2024 was approximately 3.4%. As of December 31, 2024, the principal outstanding balances under our Chilean and Spanish lines of credit was $13.5 million in the aggregate at a weighted average interest rate of approximately 5.52%.
The weighted average interest rate related to our cash, cash equivalents and restricted cash for the year ended December 31, 2025 was approximately 3.8%. As of December 31, 2025, the principal outstanding balances under our Chilean and Spanish lines of credit was $8.5 million in the aggregate at a weighted average interest rate of approximately 5.5%.
See Note 7 to the audited consolidated financial statements contained in this Annual Report on Form 10-K. The primary objective of our investment activities is to preserve the principal while at the same time maximizing yield without significantly increasing risk. To achieve this objective, we may invest our excess cash in debt instruments of the U.S.
See Note 7 to the Consolidated Financial Statements. The primary objective of our investment activities is to preserve the principal while at the same time maximizing yield without significantly increasing risk. To achieve this objective, we may invest our excess cash in debt instruments of the U.S.
Gross accumulated currency translation adjustments recorded as a separate component of shareholders’ equity were $52.7 million and $34.6 million at December 31, 2024 and 2023, respectively.
During the years ended December 31, 2025 and 2024, the most significant currency exchange rate exposures were to the Chilean Peso and Euro. Gross accumulated currency translation adjustments recorded as a separate component of shareholders’ equity were $17.6 million and $52.7 million at December 31, 2025 and 2024, respectively.
Removed
For the years ended December 31, 2024, 2023, and 2022, approximately 23.1%, 29.6%, and 21.6% of revenue was denominated in currencies other than the U.S. Dollar (USD).

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