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What changed in Solventum's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Solventum'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.

+373 added−351 removedSource: 10-K (2026-02-27) vs 10-K (2025-02-28)

Top changes in Solventum's 2025 10-K

373 paragraphs added · 351 removed · 258 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

79 edited+25 added−51 removed71 unchanged
Biggest changeIf the European Medical Agency concludes that all requirements for efficacy, safety and quality are met, it issues a positive opinion that is forwarded to the European Commission and the European Commission makes the final decision on the granting of a marketing authorization. 12 Table of Contents China The chief pharmaceutical product and medical device regulator in China is the National Medical Products Administration (“NMPA”), which enforces medical device and pharmaceutical product laws and regulations and standards and has the power to issue fines, seize products, withdraw or suspend an approval or a registration for serious non-compliances, and refer cases for criminal prosecution.
Biggest changeChina The chief pharmaceutical product and medical device regulator in China is the National Medical Products Administration ("NMPA"), which enforces medical device and pharmaceutical product laws and regulations and standards and has the power to issue fines, seize products, withdraw or suspend an approval or a registration for serious non-compliances, and refer cases for criminal prosecution.
Class III devices typically require pre-market approval. Most medical devices are cleared by FDA through the Pre-Market Notification, or 510(k), process. This process requires medical device manufacturers to demonstrate that their devices are as safe and effective as (i.e., substantially equivalent to) a legally marketed medical device.
Class III devices typically require pre-market approval. Most medical devices are cleared by the FDA through the Pre-Market Notification, or 510(k), process. This process requires medical device manufacturers to demonstrate that their devices are as safe and effective as (i.e., substantially equivalent to) a legally marketed medical device.
In certain markets the pricing for certain Solventum’s products may be subject to prior approval, including in jurisdictions where Solventum’s products are subject to government reimbursement, whereas in other markets Solventum may be able to set its own prices for its products subject to certain degrees of monitoring and control by the applicable governmental authority.
In certain markets the pricing for certain of Solventum’s products may be subject to prior approval, including in jurisdictions where Solventum’s products are subject to government reimbursement, whereas in other markets Solventum may be able to set its own prices for its products subject to certain degrees of monitoring and control by the applicable governmental authority.
Pre-market notifications are required for most Class II and some Class I medical devices. Due to the level of risk associated with Class III devices, the FDA has determined that these devices require a Pre-market approval (a “PMA”). A PMA application is the most stringent type of marketing application required by the FDA.
Pre-market notifications are required for most Class II and some Class I medical devices. Due to the level of risk associated with Class III devices, the FDA has determined that these devices require a pre-market approval (a " PMA " ). A PMA application is the most stringent type of marketing application required by the FDA.
Following the completion of the clinical trials, the NDA process with the FDA generally involves the following: • preparation of and submission to the FDA of an NDA; • potential review of the product application by an FDA advisory committee, where appropriate and if applicable; • a determination by the FDA within 60 days of its receipt of an NDA to file the application for review; • satisfactory completion of an FDA pre-approval inspection of the manufacturing facilities where the proposed product drug substance and drug product are produced to assess compliance with current Good Manufacturing Processes (“cGMP”), and audits of selected clinical trial sites to ensure compliance with GCP; and • FDA review and approval of an NDA prior to any commercial marketing or sale of the drug or biologic in the United States.
Following the completion of the clinical trials, the NDA process with the FDA generally involves the following: • preparation of and submission to the FDA of an NDA; • potential review of the product application by an FDA advisory committee, where appropriate and if applicable; • a determination by the FDA within 60 days of its receipt of an NDA to file the application for review; • satisfactory completion of an FDA pre-approval inspection of the manufacturing facilities where the proposed product drug substance and drug product are produced to assess compliance with current Good Manufacturing Processes ("cGMP"), and audits of selected clinical trial sites to ensure compliance with GCP; and • FDA review and approval of an NDA prior to any commercial marketing or sale of the drug or biologic in the United States.
In addition, many of Solventum’s products are subject to regulation by the Consumer Product Safety Commission (the “CPSC”) under the Consumer Product Safety Act and other laws enforced by the CPSC. These statutes and related regulations establish safety standards and bans for consumer products.
In addition, many of Solventum’s products are subject to regulation by the Consumer Product Safety Commission (the "CPSC") under the Consumer Product Safety Act and other laws enforced by the CPSC. These statutes and related regulations establish safety standards and bans for consumer products.
Principal competitors include Optum, Microsoft (Nuance), Epic, Cerner, Athena, and a host of start-up technologies actively working to disrupt the areas of revenue cycle management and clinician productivity. In the United States, the market for value-based care software solutions is highly fragmented and subject to continuous entry of new competitors. The market is even more fragmented internationally.
Principal competitors include Optum, Microsoft (Nuance), Epic, Oracle (Cerner), Waystar, Athena, and a host of start-up technologies actively working to disrupt the areas of revenue cycle management and clinician productivity. In the United States, the market for value-based care software solutions is highly fragmented and subject to continuous entry of new competitors. The market is even more fragmented internationally.
Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), are available on our website for free as soon as reasonably practicable after they are filed electronically with the SEC.
Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), are available on our website for free as soon as reasonably practicable after they are filed electronically with the SEC.
We partner with our medical affairs group to enhance our clinical insight and expand awareness of clinical studies regarding our solutions by increasing both the number of peer-reviewed publications and the visibility for existing publications that address our solutions. Intellectual Property Development and protection of our proprietary technologies through IP rights is a strategic priority for our business.
We partner with our medical and scientific affairs to enhance our clinical insight and expand awareness of clinical studies regarding our solutions by increasing both the number of peer-reviewed publications and the visibility for existing publications that address our solutions. Intellectual Property Development and protection of our proprietary technologies through IP rights is a strategic priority for our business.
Our business possesses strong customer relationships, a broad, wide-ranging, and well-known portfolio of brands, differentiated technology, and manufacturing expertise. We serve a diverse customer base, ranging from multidisciplinary hospitals and local clinics/practices to biopharmaceutical manufacturers. Our long-tenured and collaborative customer relationships globally give us unique insights into their needs and preferences.
Our business possesses strong customer relationships, a broad, wide-ranging, and well-known portfolio of brands, differentiated technology, and manufacturing expertise. We serve a diverse customer base, ranging from multidisciplinary hospitals to local clinics/practices. Our long-tenured and collaborative customer relationships globally give us unique insights into their needs and preferences.
To expand our market coverage into emerging geographies in the Latin America ("LATAM"), Europe, Middle East and Africa ("EMEA"), and Asia regions, we employ an export commercial model and leverage local partners to market and sell our products. Our local third-party partners facilitate regulatory and cross-border import compliance and distribute directly to the customer.
To expand our market coverage into emerging geographies in the Latin America, Europe, Middle East and Africa, and Asia regions, we employ an export commercial model and leverage local partners to market and sell our products. Our local third-party partners facilitate regulatory and cross-border import compliance and distribute directly to the customer.
Compliance with EHS laws, regulations, customer requirements, and industry standards requires, among other things, that we maintain and operate our equipment safely; obtain and keep current environmental permits, radioactive material licenses, and radiation machine registrations; install pollution control technologies; and maintain certain records and submit specific reports.
Compliance with EHS laws, regulations, customer requirements, and industry standards require, among other things, that we maintain and operate our equipment safely; obtain and keep current environmental permits, radioactive material licenses, and radiation machine registrations; install pollution control technologies; and maintain certain records and submit specific reports.
Consequences of non-compliance may include monetary fines of up to five percent of the previous year’s revenue, termination of data transfers and personal liability imposed on those directly responsible. Solventum is also subject to similar privacy and data protection frameworks in other developed and emerging markets.
Consequences of non-compliance with PIPL may include monetary fines of up to five percent of the previous year’s revenue, termination of data transfers and personal liability imposed on those directly responsible. Solventum is also subject to similar privacy and data protection frameworks in other developed and emerging markets.
The first eight years of her career were in consulting with Accenture. Ms. Landucci has served on the Board of Directors for Healthy Women, the leading independent, non-profit health information source for women in the U.S. Ms. Landucci earned her Bachelor of Arts in Environmental Studies from Gustavus Adolphus College. Garri Garrison . Ms.
The first eight years of her career were in consulting with Accenture. Ms. Landucci has served on the Board of Directors for Healthy Women, the leading independent, non-profit health information source for women in the U.S. Ms. Landucci earned her Bachelor of Arts in Environmental Studies from Gustavus Adolphus College.
In the MedSurg segment, our advanced wound care market is highly competitive, particularly in the United States and Europe, with our principal competitors including Smith & Nephew, Medela, Mölnlycke, Coloplast, and Convatec. Our infection prevention and surgical supplies solutions are offered in highly competitive and fragmented end markets, especially in the United States and Europe.
In the MedSurg segment, the advanced wound care market is highly competitive, particularly in the United States and Europe, with our principal competitors including Smith & Nephew, Medaxis, Mölnlycke, Coloplast, and Convatec. Our infection prevention and surgical supplies solutions are offered in highly competitive and fragmented end markets, especially in the United States and Europe.
The respective age of each individual in the tables below is as of December 31, 2024. No family relationships exist among any of the executive officers named, nor is there any undisclosed arrangement or understanding pursuant to which any person was selected as an officer.
The respective age of each individual in the tables below is as of December 31, 2025. No family relationships exist among any of the executive officers named, nor is there any undisclosed arrangement or understanding pursuant to which any person was selected as an officer.
In addition to REACH and OSHA, Solventum manufacturing facilities are also subject to additional environmental, health and safety statutes, regulations and permit requirements, including, but not limited to, applicable requirements under the Clean Air Act, the Clean Water Act, the Resource Conservation and Recovery Act, the Seveso-III Directive (Directive 2012/18/EU), the European Machinery Directive (Directive 2006/42/EC), the EU Industrial Emissions Directive (Directive 2010/75/EU), and the European Pollutant Release and Transfer Register.
In addition, Solventum manufacturing facilities are also subject to environmental, health and safety statutes, regulations and permit requirements, including, but not limited to, applicable requirements under the Clean Air Act, the Clean Water Act, the Resource Conservation and Recovery Act, the Seveso-III Directive (Directive 2012/18/EU), the European Machinery Directive (Directive 2006/42/EC), the EU Industrial Emissions Directive (Directive 2010/75/EU), and the European Pollutant Release and Transfer Register.
Before each clinical study may be initiated, an independent Institutional Review Board or ethics committee representing each clinical site must approve such study. The clinical studies must be adequate, well-controlled and conducted in accordance with Good Clinical Practice (“GCP”) requirements.
Before each clinical study may be initiated, an independent Institutional Review Board or ethics committee representing each clinical site must approve such study. The clinical studies must be adequate, well-controlled and conducted in accordance with Good Clinical Practice ( " GCP " ) requirements.
The NDA process typically begins with the completion of extensive preclinical laboratory tests and preclinical animal studies, which may need to be performed in accordance with the Good Laboratory Practices regulations, followed by the submission to 11 Table of Contents the FDA of an investigational new drug application which must become effective before human clinical trials may begin and must be updated annually.
The NDA process typically begins with the completion of extensive preclinical laboratory tests and preclinical animal studies, which may need to be performed in accordance with the Good Laboratory Practices regulations, followed by the submission to the FDA of an investigational new drug application which must become effective before human clinical trials may begin and must be updated annually.
After the completion of the clinical trials, an NDA is submitted to the FDA to demonstrate that a drug is safe and effective in its proposed use(s), the benefits of the drug outweigh the risks, the drug’s proposed labeling (package insert) is appropriate, and the methods used to manufacture the drug are adequate to preserve the drug’s identity, strength, quality, and purity.
After the completion of the clinical trials, an NDA is submitted to the FDA to demonstrate that a drug is safe and effective in its proposed use(s), the benefits of the drug outweigh the risks, the drug’s proposed labeling (package insert) is appropriate, and 11 Table of Contents the methods used to manufacture the drug are adequate to preserve the drug’s identity, strength, quality, and purity.
Engaging talent such as those who are involved in our Employee Resource Networks, which are open to everyone, has proven to be a way to empower and inspire our workforce as they drive innovation in unique ways. • Compensation and Benefits : Our total compensation for employees includes a variety of components that support sustainable employment and the ability to build a strong financial future, including competitive market-based pay and comprehensive benefits.
Engaging talent such as those who are involved in our Employee Impact Groups, which are open to everyone, has proven to be a way to empower and inspire our workforce as they drive innovation in unique ways. • Compensation and Benefits : Our total compensation for employees includes a variety of components that support sustainable employment and the ability to build a strong financial future, including competitive market-based pay and comprehensive benefits.
These laws, regulations, ordinances, requirements and standards affect a significant portion of our activities globally across each of our segments and product lines and require compliance related to, among other things: (a) occupational health, safety, and well-being; (b) the protection of the environment; (c) emissions and discharges to air and water; (d) greenhouse gas management and climate change; (e) the use of natural resources; (f) the handling, use, storage, transportation, and disposal of toxic or hazardous materials, radioactive materials, and solid and hazardous wastes; and (g) the procurement and use of select materials and chemicals.
These affect a significant portion of our activities globally across each of our segments and product lines and require compliance related to, among other things: (a) occupational health, safety, and well-being; (b) the protection of the environment; (c) emissions and discharges to air and water; (d) greenhouse gas management and climate change; (e) the use of natural resources; (f) the handling, use, storage, transportation, and disposal of toxic or hazardous materials, radioactive materials, and solid and hazardous wastes; and (g) the procurement and use of select materials and chemicals.
Generally, drugs are brought to the market through the New Drug Application (“NDA”) process or an Over-the-Counter (“OTC”) Monograph. Solventum’s pharmaceutical products are brought to market through the NDA and OTC pathways.
Generally, drugs are brought to the market through the New Drug Application ( " NDA " ) process or an Over-the-Counter ( " OTC " ) Monograph. Solventum’s pharmaceutical products are brought to market through the NDA and OTC pathways.
Information on how to submit any such communications can be found on Solventum’s website, under “Ethics and Compliance.” Solventum’s Chief Compliance Officer has a direct reporting obligation to the Audit Committee and regularly reports to the Audit Committee on compliance with Solventum's Code of Conduct, including the effectiveness of Solventum's compliance program.
Information on how to submit any such communications can be found on Solventum’s website, under "Ethics and Compliance." Solventum’s Chief Compliance Officer has a direct reporting obligation to the Audit Committee and regularly reports to the Audit Committee on compliance with Solventum's Code of Conduct, including the effectiveness of Solventum's compliance program.
Our relationship with employee-representative 7 Table of Contents organizations outside the U.S. takes many forms, including in European Union countries where we engage with representative bodies for employees, such as employee forums, works councils and trade unions, in accordance with local law. Our employees are united in our mission to provide better, smarter, safer healthcare to improve lives.
Our relationship with employee-representative organizations outside the U.S. takes many forms, including in European Union countries where we engage with representative bodies for employees, such as employee forums, works councils and trade unions, in accordance with local law. Our employees are united in our mission to provide better, smarter, safer healthcare to improve lives.
Our culture highlights collaboration and teamwork, along with a focus on empathy, solving challenges and improving care. The ability to recruit, retain, develop, protect, and fairly compensate our global workforce will be a key driver of our success.
Our culture highlights collaboration and teamwork, along with a focus on empathy, solving challenges and improving care. 7 Table of Contents The ability to recruit, retain, develop, protect, and fairly compensate our global workforce will be a key driver of our success.
Research and Development Activities Our Research and Development (“R&D ” ) activities are focused on developing new solutions that are clinically supported and differentiated as well as improving on our marketed solutions to address evolving customer needs and enable better outcomes and access for patients.
Research and Development Activities Our Research and Development ("R&D") activities are focused on developing new solutions that are clinically supported and differentiated as well as improving on our marketed solutions to address evolving customer needs and enable better outcomes and access for patients.
These insights inform our innovation processes, drive stronger customer retention, and create multiple avenues for further customer engagement. Business Segments We are organized into four operating business segments that are aligned with the markets we serve.
These insights inform our innovation processes, drive stronger customer retention, and create multiple avenues for further customer engagement. Business Segments We are organized into three reportable operating business segments that are aligned with the markets we serve.
Our R&D team consists of approximately 2,000 employees, including research scientists, chemical engineers, data scientists, software engineers, application development engineers and product developers. They are supported by a team of accomplished clinicians from our medical affairs group.
Our R&D team consists of approximately 2,000 employees, including research scientists, chemical engineers, data scientists, software engineers, and product developers. They are supported by a team of accomplished clinicians from our medical affairs.
United States In the United States, the Food, Drug, and Cosmetic Act (“FDA”) authorizes the FDA to oversee and regulate the production, sale, and distribution of food, drugs, medical devices, and cosmetics. Medical Devices Solventum’s medical devices are regulated by the FDA’s Center for Devices and Radiological Health.
United States In the United States, the Food, Drug, and Cosmetic Act authorizes the Food and Drug Administration to oversee and regulate the production, sale, and distribution of food, drugs, medical devices, and cosmetics. Medical Devices Solventum’s medical devices are regulated by the FDA’s Center for Devices and Radiological Health.
See “Item 10: Directors, Executive Officers and Corporate Governance – Code of Ethics” for information about our Code of Ethics governing our Chief Executive Officer, Chief Financial Officer and Controller and Chief Accounting Officer. Solventum’s Board of Directors has also implemented a Code of Business Conduct and Ethics for Directors of Solventum.
See "Item 10: Directors, Executive Officers and Corporate Governance – Code of Ethics" for information about our Code of Ethics governing our Chief Executive Officer, Chief Financial Officer and Controller and Chief Accounting Officer. Solventum’s Board of Directors has also implemented a Code of Business Conduct and Ethics for Directors of Solventum.
The health care software technology market in which we conduct our business, and the healthcare information technology (“HCIT ” ) industry in general, is highly competitive and dynamic, characterized by the continual introduction of new products and technologies.
The health care software technology market in which we conduct our business, and the healthcare information technology ("HCIT") industry in general, is highly competitive and dynamic, characterized by the continual introduction of new products and technologies.
Pharmaceutical Products The European Medicines Agency is responsible for regulating pharmaceutical products in the European Union. The European Medicines Agency implements a system similar to the U.S. FDA’s Center for Drug Evaluation and Research and it is responsible for evaluating the quality, safety, and efficacy of drug products in the EU.
The European Medicines Agency implements a system similar to the U.S. FDA’s Center for Drug Evaluation and Research and it is responsible for evaluating the quality, safety, and efficacy of drug products in the EU.
A n OTC drug monograph is a type of “recipe book” covering acceptable ingredients, doses, formulations, labeling, and, in some cases, testing parameters. OTC drug monographs are continually updated to add additional ingredients and labeling as needed. Products conforming to a monograph may be marketed without FDA pre-approval.
A n OTC drug monograph is a type of " recipe book " covering acceptable ingredients, doses, formulations, labeling, and, in some cases, testing parameters. OTC drug monographs are continually updated to add additional ingredients and labeling as needed. Products conforming to a monograph may be marketed without FDA pre-approval.
Some of these products meet the definition of medical devices or pharmaceuticals and are regulated, as such, by various governmental bodies, globally. All products produced by the MedSurg and Dental Solutions segments, with very few exceptions, meet the definition of a medical device or pharmaceutical product.
Some of these products meet the definition of medical devices, pharmaceuticals or combination products and are regulated, as such, by various governmental bodies, globally. All products produced by the MedSurg and Dental Solutions segments, with 10 Table of Contents very few exceptions, meet the definition of a medical device or pharmaceutical product.
Solventum’s Code of Conduct for employees and the Code of Business Conduct and Ethics for Directors are available on Solventum’s website at www.solventum.com. Additional Information Solventum’s Internet address is www.solventum.com.
Solventum’s Code of Conduct for employees and the Code of Business Conduct and Ethics for Directors are available on Solventum’s website at www.solventum.com. 16 Table of Contents Additional Information Solventum’s Internet address is www.solventum.com.
Accordingly, the development, manufacture, and commercialization of these products must comply with the regulations governing medical devices or pharmaceuticals in the markets we serve. Conversely, none of the products produced by the Health Information Systems and Purification and Filtration segments meet the definition of medical devices or pharmaceuticals.
Accordingly, the development, manufacture, and commercialization of these products must comply with the regulations governing medical devices or pharmaceuticals in the markets we serve. Conversely, none of the products produced by the Health Information Systems segment meet the definition of medical devices or pharmaceuticals.
Determinations of the safety and efficacy of our products are solely within the authority of the FDA or other applicable regulatory authorities in jurisdictions outside the United States.
Determinations of the safety and efficacy of our products are solely within the authority of the United States Food and Drug Administration ("FDA") or other applicable regulatory authorities in jurisdictions outside the United States.
Health Information Systems (15.8% of 2024 total sales) provides healthcare systems with software solutions – including computer-assisted physician documentation, direct-to-bill and coding automation, classification methodologies, speech recognition, and data visualization platforms – that are designed to eliminate revenue cycle waste, create more time for patient care, and support value-based care.
Health Information Systems (16.3% of 2025 total sales) provides healthcare systems with software solutions – including computer-assisted physician documentation, direct-to-bill and coding automation, classification methodologies, speech recognition, and data visualization platforms – that are designed to eliminate revenue cycle waste, create more time for patient care, and support value-based care.
For a discussion of these laws and regulations, see the section titled “Environmental, Health, and Safety Matters.” 15 Table of Contents Information about our Executive Officers Below is a list of the executive officers of the Company and other significant employees who are members of our leadership team.
For a discussion of these laws and regulations, see the section titled "Environmental, Health, and Safety Matters." 14 Table of Contents Information about our Executive Officers Below is a list of the executive officers of the Company and other significant employees who are members of our leadership team.
Previously, Ms. Kirberger was Executive Vice President, General Counsel and Corporate Secretary at Elanco, a pharmaceutical company in the animal health field, from June 2021 to November 2023, where she was responsible for the global strategy and operations of the legal function and had responsibility for Corporate Affairs, Ethics & Compliance and ESG. Prior to joining Elanco, Ms.
Kirberger was Executive Vice President, General Counsel and Corporate Secretary at Elanco, a pharmaceutical company in the animal health field, from June 2021 to November 2023, where she was responsible for the global strategy and operations of the legal function and had responsibility for Corporate Affairs, ESG and Enterprise Risk Management programs. Prior to joining Elanco, Ms.
Item 1. Business Solventum Corporation (“Solventum, ” or the “Company ” ), is a leading global healthcare company developing, manufacturing, and commercializing a broad portfolio of solutions that leverages deep material science, data science, and digital capabilities to address critical customer and patient needs.
Item 1. Business Solventum Corporation ("Solventum," "we," "our," "us," or the "Company"), is a leading global healthcare company developing, manufacturing, and commercializing a broad portfolio of solutions that leverages deep material science, data science, and digital capabilities to address critical customer and patient needs.
The product portfolio of each segment is dynamic and changes with time, depending on the needs of the customers served. While the Health Information Systems and Purification and Filtration segments do not currently include medical devices or pharmaceutical products, this may change in the future.
The product portfolio of the segment is dynamic and changes with time, depending on the needs of the customers served. While the Health Information Systems segment does not currently include medical devices or pharmaceutical products, this may change in the future.
These regulations apply to the activities performed by most of Solventum’s employees, including but not limited to sales and marketing, research and development, regulatory affairs, quality assurance, medical affairs, and operations, both before and after a product is commercially distributed. These regulations differ by country and/or region and are dynamic.
These regulations are dynamic and • apply to all facilities of Solventum’s business that conduct the foregoing activities, regardless of where the facilities are located; • apply to the activities performed by most of Solventum’s employees, including but not limited to sales and marketing, research and development, regulatory affairs, quality assurance, medical affairs, and operations, both before and after a product is commercially distributed; and • differ by country and/or region.
This information is presented in the table below as of the date of the 10-K filing (February 28, 2025).
This information is presented in the table below as of the date of the 10-K filing (February 27, 2026).
Dental Solutions (15.7% of 2024 total sales) is a provider of a comprehensive suite of dental and orthodontic products including brackets, aligners, restorative cements, and bonding agents that span the “life of the tooth,” including products designed for preventative dental care, direct and indirect restoration, and broad orthodontic needs.
Dental Solutions (16.2% of 2025 total sales) is a provider of a comprehensive suite of dental and orthodontic products including brackets, aligners, restorative cements, and bonding agents that span the "life of the tooth," including products designed for preventative dental care, direct and indirect restoration, and broad orthodontic needs.
We believe that collaboration across our organization further enhances our R&D capabilities by encouraging the sharing of best practices, enabling collaborative development and issue resolution, promoting synergies in development and manufacturing, and creating a broad culture of exploration.
We believe that collaboration across our organization further enhances our R&D capabilities by standardization of common processes and sharing of best practices, enabling consistent and collaborative development and issue resolution, promoting synergies in development and manufacturing, and creating a broad culture of solving what matters.
Medical devices are classified into three classes: Class I (Lowest Risk), Class II, and Class III (Highest Risk). Approved products are subject to post-market requirements for reporting adverse events and recalls, as well as regular risk assessments of devices and potentially re-evaluation reports of the safety and effectiveness of the device based on more significant safety signals.
Approved products are subject to post-market requirements for reporting adverse events and recalls, as well as regular risk assessments of devices and potentially re-evaluation reports of the safety and effectiveness of the device based on more significant safety signals.
MedSurg (56.2% of 2024 total sales) is a provider of solutions including negative pressure wound therapy, advanced wound dressings, advanced skin care, I.V. site management, sterilization assurance, temperature management, surgical supplies, medical tapes and wraps, stethoscopes, medical electrodes, and medical technologies Original Equipment Manufacturer (“OEM ”) .
MedSurg (57.9% of 2025 total sales) is a provider of solutions including negative pressure wound therapy, advanced wound dressings, advanced skin care, synthetic tissue matrices, I.V. site management, sterilization assurance, temperature management, surgical supplies, medical tapes and wraps, stethoscopes, medical electrodes, and medical technologies Original Equipment Manufacturer ("OEM" ) .
Our export commercial team provides technical, clinical, and marketing support both directly to our customers as well as to our third-party partners, to help increase customer satisfaction and support our ability to grow our global presence. Global Supply Chain and Sourcing Our sourcing, production, and distribution network is managed globally.
Our export commercial team provides technical, clinical, and marketing support both directly to our customers as well as to our third-party partners, to help increase customer satisfaction and support our ability to grow our global presence.
Prior to joining Medtronic, he was Vice President of Global Manufacturing at Covidien. Mr. Harrington earned his Bachelor's degree in Business Administration from Kingston College. Marcela Kirberger . Ms. Kirberger has served as the Chief Legal Affairs Officer of Solventum since 2024 after serving as the Chief Legal Affairs Officer of 3M’s Health Care Business Group since November 2023.
Prior to joining Medtronic, he was Vice President of Global Manufacturing at Covidien. Mr. Harrington earned his Bachelor's degree in Business Administration from Kingston College. Marcela Kirberger . Ms. Kirberger has served as the Chief Corporate and Legal Affairs Officer and Corporate Secretary of Solventum since 2026, and was previously the Chief Legal Affairs Officer since 2024.
While Solventum utilizes industry standard processes, including the National Institute of Standards and Technology (the “NIST”) privacy framework and third-party management processes, to assess the potential impact of emerging laws and enforcement trends on its business and to mitigate potential impacts on its business, data privacy laws and regulations and their scope and enforcement are constantly evolving, and Solventum cannot predict what effect, if any, changes to these laws and regulations and Solventum’s compliance with them may have on its business.
While Solventum utilizes industry standard processes, including the National Institute of Standards and Technology (the "NIST") privacy framework and third-party management processes, to assess the potential impact of emerging laws and enforcement trends on its business and to mitigate potential impacts on its business, data privacy laws and regulations and their scope and enforcement are constantly evolving, and Solventum cannot predict what effect, if any, changes to these laws and regulations and Solventum’s compliance with them may have on its business. 13 Table of Contents Global Healthcare Compliance The marketing, promotion, and sale of medical devices, drugs, and services is regulated by the U.S.
Regulatory authorities, including the FDA, strictly regulate the indications for use and associated promotional safety and effectiveness claims that may be made about approved or cleared products.
Regulatory authorities, including the FDA and other government bodies in the jurisdictions where Solventum markets its products, strictly regulate the indications for use and associated promotional safety and effectiveness claims that may be made about approved or cleared products.
Medical Devices Locally manufactured medical devices gain market authorization through municipal authorities, while medical devices that are not manufactured in China are reviewed by the NMPA and must be accompanied by appropriate documentation showing that the device has been approved in its country of origin.
Medical Devices Locally manufactured medical devices gain market authorization through municipal authorities, while medical devices that are not manufactured in China are reviewed by the NMPA and must be accompanied by appropriate documentation showing that the device has been approved in its country of origin. 12 Table of Contents Medical devices are classified into three classes: Class I (Lowest Risk), Class II, and Class III (Highest Risk).
Classification is dependent on a variety of factors, including duration of use, whether the device is invasive or non-invasive, and whether the device is considered “active.” Notified bodies are responsible for ensuring that manufacturers comply with the requirements of the Medical Device Regulation. All medical devices in Solventum’s current portfolio are regulated as medical devices in the European Union.
Classification is dependent on a variety of factors, including duration of use, whether the device is invasive or non-invasive, and whether the device is considered "active." Notified bodies are responsible for ensuring that manufacturers comply with the requirements of the Medical Device Regulation. Pharmaceutical Products The European Medicines Agency is responsible for regulating pharmaceutical products in the European Union.
Health Insurance Portability and Accountability Act of 1996, as amended, (the “HIPAA”), the California Consumer Privacy Act (the “CCPA”), and similar U.S. state laws, the European Union’s General Data Protection Regulation (the “E.U. GDPR”), the United Kingdom’s Data Protection Act 2018 (the “UK DPA”) and the General Data Protection Regulation (the “U.K.
Health Insurance Portability and Accountability Act of 1996, as amended, (the "HIPAA"), the California Consumer Privacy Act (the "CCPA"), and similar U.S. state laws, the European Union’s General Data Protection Regulation (the "E.U. GDPR"), the United Kingdom’s Data Protection Act 2018 (the "UK DPA") and the General Data Protection Regulation (the "U.K.
Solventum commits a significant amount of resources to maintain compliance with these regulations. Compliance with these regulations requires Solventum to create systems, processes, and procedures that are aligned with the regulations in all markets Solventum serves. Compliance also requires Solventum to maintain knowledge of the current regulations that govern its activities.
Compliance with these regulations requires Solventum to create systems, processes, and procedures that are aligned with the regulations in all markets Solventum serves. Compliance also requires Solventum to maintain knowledge of the current regulations that govern its activities. As these regulations change, Solventum must adapt its systems, processes, and procedures to comply with the new regulations. See "Item 1A.
GDPR”), and China’s Personal Information Protection Law (“PIPL”), and Personal Data Cross Border Transfer Rule (“CBDT”).
GDPR"), and China’s Personal Information Protection Law ("PIPL"), and Personal Data Cross Border Transfer Rule ("CBDT").
Our supply chain resiliency program consisting of regional sources of supply, dual-source manufacturing capabilities and vertically integrated operations presents a competitive advantage by providing a reliable supply of products to our customers. 9 Table of Contents Regulations General The regulations applicable to Solventum are promulgated and enforced by government bodies in individual countries and govern the methods and controls used for the design, manufacture, packaging labeling, storage, safety, sales and distribution, marketing clearance or approval, advertising and promotion, sterilization, installation, servicing, performance and effectiveness of the products Solventum sells globally.
Regulations General The regulations applicable to Solventum are promulgated and enforced by government bodies in individual countries and govern the methods and controls used for the design, manufacture, packaging labeling, storage, safety, sales and distribution, marketing clearance or approval, advertising and promotion, sterilization, installation, servicing, performance and effectiveness of the products Solventum sells globally.
A CE Mark is a symbol placed on a product that declares that the product is compliant with the essential requirements of applicable health, safety and environmental protection regulation.
Manufacturers must demonstrate compliance to the requirements of the Medical Device Regulation, prior to affixing the CE Mark on the products and commercializing in the European Union. A CE Mark is a symbol placed on a product that declares that the product is compliant with the essential requirements of applicable health, safety and environmental protection regulation.
Acquisitions As part of our business strategy, Solventum intends to monitor its business portfolio and organizational structure and may make acquisitions that expand or enhance its organizational structure.
These solutions are designed to ensure accuracy of reimbursement and reduce the administrative burden that clinicians face. Acquisitions and Divestitures As part of our business strategy, Solventum intends to monitor its business portfolio and organizational structure and may make acquisitions and divestitures that expand or enhance its organizational structure.
These include laws and regulations related to kickbacks, false claims, self-referrals, and healthcare fraud and abuse. Similar regulations are imposed at the state level, as well as in many global markets in which we do business. The U.S. FCPA, the U.K.
Similar regulations are imposed at the state level, as well as in many global markets in which we do business. The U.S. FCPA, the U.K.
Barry earned his Bachelor of Science in Environmental Science from Texas Tech University. Tammy Gomez . Ms. Gomez has served as the Chief Human Resources Officer of Solventum since 2024. Before joining Solventum, Ms. Gomez was Executive Vice President and Chief Human Resource Officer at Owens & Minor from July 2022 to December 2023.
Ms. Knight currently serves on the board of directors of Waters Corporation. 15 Table of Contents Tammy Gomez . Ms. Gomez has served as the Chief Human Resources Officer of Solventum since 2024. Before joining Solventum, Ms. Gomez was Executive Vice President and Chief Human Resource Officer at Owens & Minor from July 2022 to December 2023.
McMillan started his career in accounting, audit, financial analysis and investor relations positions at various institutions. Mr. McMillan earned his Bachelor of Science in Business Administration from Merrimack College and an MBA from Bentley University McCallum Graduate School of Business. Sanjiv Arora . Mr. Arora has served as the Chief Strategy and Corporate Development Officer of Solventum since 2024.
McMillan started his career in accounting, audit, financial analysis and investor relations positions at various institutions. Mr. McMillan earned his Bachelor of Science in Business Administration from Merrimack College and an MBA from Bentley University McCallum Graduate School of Business. Mr. McMillan currently serves on the board of directors of Hologic Inc. Heather Knight . Ms.
In addition, our distribution network footprint meets the needs of our customers in a cost-effective model. As we separate from 3M, we continue to leverage 3M's distribution networks and manufacturing sites across certain geographies. The use of both distribution network and manufacturing sites are covered under a Transition and Distribution Agreement and a Transition Contract Manufacturing Agreement, respectively, with 3M.
As we separate from 3M, we continue to leverage 3M's established infrastructure across certain geographies ensuring continuity and reliability during our transition, while we invest in expanding our independent capabilities. The use of both distribution networks and manufacturing sites is covered under a Transition and Distribution Agreement and a Transition Contract Manufacturing Agreement, respectively, with 3M.
Solventum maintains the confidentiality of all reported concerns in accordance with legal requirements and in the best interest of the organization and those involved. Solventum does not tolerate retaliation for anyone who raises a genuine concern in good faith and educates employees on this policy.
Solventum does not tolerate retaliation for anyone who raises a genuine concern in good faith and educates employees on this policy.
Use is critically evaluated on an on-going basis, and non-PFAS alternatives are utilized, when possible. Regulatory and legislative activities concerning PFAS are accelerating in the United States, Europe and elsewhere.
As an example, a specific chemical category of interest is Per - and polyfluoroalkyl substances ("PFAS"). A small number of Solventum’s products utilize and/or contain PFAS. Use is critically evaluated on an on-going basis, and non-PFAS alternatives 8 Table of Contents are utilized when possible. Regulatory and legislative activities concerning PFAS are accelerating in the United States, Europe and elsewhere.
Solventum Ethics and Compliance maintains processes to receive, retain, and address concerns received from internal, external or anonymous sources. Solventum takes all reported concerns about business conduct seriously and employs a team of experienced investigators who review each concern thoroughly and conduct investigations when necessary.
Solventum Legal Affairs team maintains processes to receive, retain, and address concerns received from internal, external or anonymous sources. Solventum employs a team of experienced investigators who review the reported concerns and conduct investigations when necessary. Solventum maintains the confidentiality of reported concerns in accordance with legal requirements and in the best interest of the organization and those involved.
OTC monograph products that do not comply with these standards can be deemed unapproved new drugs and can be required to be withdrawn from the market.
OTC monograph products that do not comply with these standards can be deemed unapproved new drugs and can be required to be withdrawn from the market. European Union Medical Devices All medical devices that are placed on the market or put into service in the European Union must meet the requirements of the Medical Device Regulation.
Failure to comply with these laws may expose Solventum to monetary fines and penalties, criminal and civil enforcement actions and reputational damage. Quality and Safety The FDA and comparable authorities in other jurisdictions regulate the facilities and operational procedures that Solventum uses to manufacture its products. Solventum is required to register its facilities with these authorities.
Quality and Safety The FDA and comparable authorities in other jurisdictions regulate the facilities and operational procedures that Solventum uses to manufacture its products. Solventum is required to register its facilities with these authorities. Solventum’s products are required to be manufactured in facilities that operate in accordance with current cGMPs.
These include, but are not limited to, permitting, licensing, and authorization requirements, and regulatory obligations.
We are subject to various laws, regulations, ordinances, customer requirements, and industry standards related to EHS matters. These include, but are not limited to, permitting, licensing, and authorization requirements, and regulatory obligations.
Name Age Position Bryan Hanson 58 Chief Executive Officer Wayde McMillan 55 Chief Financial Officer Sanjiv Arora 59 Chief Strategy & Corporate Development Officer Chris Barry 52 Executive Vice President and Group President, Medical Surgical Tammy Gomez 53 Chief Human Resources Officer Paul Harrington 56 Chief Supply Chain Officer Marcela Kirberger 58 Chief Legal Affairs Officer Amy Landucci 50 Chief Information and Digital Officer Garri Garrison 65 President, Health Information Systems Vaughn Grannis 61 President, Purification and Filtration Karim Mansour 51 President, Dental Solutions The following are brief biographies describing the backgrounds of our executive officers.
Name Age Position Bryan Hanson 59 Chief Executive Officer Wayde McMillan 56 Chief Financial Officer Heather Knight 54 Chief Commercial Officer Tammy Gomez 54 Chief Human Resources Officer Paul Harrington 57 Chief Supply Chain Officer Marcela Kirberger 59 Chief Corporate & Legal Affairs Officer Amy Landucci 51 Chief Information & Digital Officer The following are brief biographies describing the backgrounds of our executive officers.
Failure to comply with cGMPs could disrupt Solventum’s ability to manufacture or supply its products. Solventum is also required to establish and follow quality systems to comply with certain post-market surveillance requirements, specifically those pertaining to adverse event reporting for medical devices and pharmaceuticals.
The FDA and comparable authorities in other jurisdictions periodically inspect Solventum’s manufacturing facilities for compliance with cGMP or similar manufacturing standards in the applicable country. Solventum is also required to establish and follow quality systems to comply with certain post-market surveillance requirements, specifically those pertaining to adverse event reporting for medical devices and pharmaceuticals.
The CCPA has been amended by the California Privacy Rights Act (“CPRA”), which came into effect, in most material respects, on January 1, 2023. The CPRA significantly modifies the CCPA, including by expanding consumers’ rights with respect to certain sensitive personal information. The E.U. GDPR and the U.K.
The CCPA has been amended by the California Privacy Rights Act ("CPRA"), which came into effect, in most material respects, on January 1, 2023, and was most recently updated again in 2025. The most recent updates address cybersecurity audits, risk assessments, and automated decision-making technology. The E.U. GDPR and the U.K.
Our employee base consists of approximately 22,000 employees, with approximately 40% having more than 10 years of tenure. We have approximately 11,000 employees in the United States and approximately 2,600 in Germany. Of our employees, approximately 5,200 are production employees working in plants across the globe.
We have approximately 10,000 employees in the United States and approximately 2,000 in Germany. Of our employees, approximately 4,000 are production employees working in plants across the globe. We do not have any unionized facilities in the US.
Global Healthcare Compliance The marketing, promotion, and sale of medical devices, drugs, and services is regulated by the U.S. Department of Health and Human Services and equivalent U.S. state and non-U.S. agencies responsible for reimbursement and regulation of the delivery of healthcare items and services.
Department of Health and Human Services and equivalent U.S. state and non-U.S. agencies responsible for reimbursement and regulation of the delivery of healthcare items and services. These include laws and regulations related to kickbacks, false claims, self-referrals, and healthcare fraud and abuse.
In addition, we have a professional and flexible work environment that promotes innovation and well-being and rewards performance. Environmental, Health, and Safety Matters We are subject to various laws, regulations, ordinances, customer requirements, and industry standards related to environment, health, and safety ( “ EHS ” ) matters.
In addition, we have a professional and flexible work environment that promotes innovation and well-being and rewards performance. Environmental, Health, and Safety Matters Solventum benefits from having both an Environmental Health and Safety (EHS) organization and a Product Stewardship (PS) organization which collaborate to ensure environmental, health and safety ("EHS") considerations are proactively managed across facilities and products.
Outside the U.S., we compete primarily with local players in the respective country or region, in addition to new market entrants. The Purification and Filtration segment competes against a diverse spectrum of competitors.
Outside the U.S., we compete primarily with local players in the respective country or region, in addition to new market entrants. Human Capital We have a long-tenured and diverse talent base with significant work experience, technical qualifications, and healthcare industry expertise. Our employee base consists of approximately 20,000 employees, with approximately 40% having more than 10 years of tenure.
Garrison has served as the President of Solventum’s Health Information Systems business since 2024. Ms. Garrison has more than 35 years of experience in healthcare, including more than 27 years spent at 3M.
Knight has served as Chief Commercial Officer of Solventum since November 2025. Ms. Knight has more than 30 years of experience in the healthcare industry.
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These solutions are designed to ensure accuracy of reimbursement and reduce the administrative burden that clinicians face. Purification and Filtration (11.6% of 2024 total sales) is a provider of purification and filtration technologies including filters, purifiers, cartridges, and membranes.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeSolventum is required to comply with increasingly complex and changing legal and regulatory requirements that govern the collection, use, storage, security, transfer, disclosure and other processing of personal data in the U.S. and in other countries, including, but not limited to, the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”), as amended, the Health Information Technology for Economic and Clinical Health Act of 2009, the California Consumer Privacy Act (“CCPA”) and other similar state laws in the U.S., the European Union’s Global Data Protection Regulation (“GDPR”), the U.K.’s Data Protection Act 2018 and General Data Protection Regulation, China’s Personal Information Protection Law, PRC Cybersecurity Law and Personal Data Cross Border Transfer Rule, and various other country-specific requirements at the state and federal level around the world.
Biggest changeExamples of those laws include, but are not limited to, the Health Insurance Portability and Accountability Act of 1996, as amended by the Health Information Technology for Economic and Clinical Health Act of 2009 (collectively, HIPAA), various U.S. state consumer privacy laws that have become effective recently, the EU General Data Protection Regulation (Regulation (EU) 2016/679 (GDPR) and the United Kingdom's version of the same, the Lei Gerai de Proteção de Dados Pessoias (Brazil LGPD), China’s Personal Information Protection Law (PIPL), PRC Cybersecurity Law and Personal Data Cross Border Transfer Rule, the European Union's Artificial Intelligence Act and various other country-specific requirements at the state and federal level around the world.
Solventum develops, manufactures, distributes and sells its products globally, and, accordingly, Solventum’s operations and the execution of its business strategies and plans are subject to global competition and economic and geopolitical risks that are beyond its control, such as, among other things, disruptions in financial markets, economic downturns, military conflicts, political changes and trends such as protectionism, economic nationalism resulting in government actions impacting international trade agreements, imposing trade restrictions such as tariffs, and retaliatory countermeasures, changes in regulatory regimes that could restrict Solventum’s ability to manufacture and sell its products (including healthcare regulatory regimes), diminished or insufficient protection of intellectual property and government deficit reduction and other austerity measures in locations or industries in which Solventum operates.
Solventum develops, manufactures, distributes and sells its products globally, and, accordingly, Solventum’s operations and the execution of its business strategies and plans are subject to global competition and economic and geopolitical risks that are beyond its control, such as, among other things, disruptions in financial markets, economic downturns, military conflicts, political changes and trends such as protectionism, economic nationalism or regionalism resulting in government actions impacting international trade agreements, imposing trade restrictions such as tariffs, and retaliatory countermeasures, changes in regulatory regimes that could restrict Solventum’s ability to manufacture and sell its products (including healthcare regulatory regimes), diminished or insufficient protection of intellectual property and government deficit reduction and other austerity measures in locations or industries in which Solventum operates.
Accordingly, the financial information included herein does not necessarily reflect the financial condition, results of operations or cash flows that Solventum would have achieved as a separate, publicly traded company during the periods presented or those that Solventum will achieve in the future primarily as a result of the factors described below: • Prior to the Spin-Off, Solventum’s working capital requirements and capital for its general corporate purposes, including capital expenditures and acquisitions, had historically been satisfied as part of the corporate-wide cash management policies of 3M.
Accordingly, the financial information included herein does not necessarily reflect the financial condition, results of operations or cash flows that Solventum would have achieved as a separate, publicly traded company during the periods prior to the Spin-Off or those that Solventum will achieve in the future primarily as a result of the factors described below: • Prior to the Spin-Off, Solventum’s working capital requirements and capital for its general corporate purposes, including capital expenditures and acquisitions, had historically been satisfied as part of the corporate-wide cash management policies of 3M.
To the extent Solventum’s contract sterilizers are unable to sterilize Solventum’s products, whether due to capacity, availability of materials for sterilization, regulatory or other constraints, including federal and state regulations on the use of ethylene oxide, Solventum may be unable to transition to alternative internal or external resources or methods in a timely or cost effective manner or at all, which could have a material impact on Solventum’s results of operations and financial condition. 3M is the sole source of supply for raw materials used in certain of our products and our business will be harmed if 3M does not satisfy our requirements. 3M is the sole source of supply for certain chemical materials and inputs used in our products (including transparent IV film dressings, biological indicators for sterilization assurance, medical securement tapes and dental composites and cements) that, as of the Spin-Off, accounted for approximately $3 billion of our revenue for fiscal year 2024, including a material with a manufacturing process proprietary to 3M that is used in our products accounting for approximately $2 billion of our revenue for fiscal year 2024.
To the extent Solventum’s contract sterilizers are unable to sterilize Solventum’s products, whether due to capacity, availability of materials for sterilization, regulatory or other constraints, including federal and state regulations on the use of ethylene oxide, Solventum may be unable to transition to alternative internal or external resources or methods in a timely or cost effective manner or at all, which could have a material impact on Solventum’s results of operations and financial condition. 3M is the sole source of supply for raw materials used in certain of our products and our business will be harmed if 3M does not satisfy our requirements. 3M is the sole source of supply for certain chemical materials and inputs used in our products (including transparent IV film dressings, biological indicators for sterilization assurance, medical securement tapes and dental composites and cements) that, as of the Spin-Off, accounted for approximately $3 billion of our revenue for fiscal year 2025, including a material with a manufacturing process proprietary to 3M that is used in our products accounting for approximately $2 billion of our revenue for fiscal year 2025.
Solventum may face potential liabilities related to PFAS, which could adversely impact Solventum’s results. 3M has agreed to assume, and indemnify and defend us against, certain liabilities relating to PFAS, generally including all such liabilities relating to the period prior to the Spin-Off, as well as certain liabilities relating to Solventum products that contain PFAS and that continue to be sold on the same basis by Solventum following the Spin-Off through 2025.
Solventum may face potential liabilities related to PFAS, which could adversely impact Solventum’s results. 3M agreed to assume, and indemnify and defend us against, certain liabilities relating to PFAS, generally including all such liabilities relating to the period prior to the Spin-Off, as well as certain liabilities relating to Solventum products that contain PFAS and that continue to be sold on the same basis by Solventum following the Spin-Off through 2025.
The potential options available to Solventum following 2025 (after which sales by Solventum of products containing or enabled by PFAS will no longer be subject to indemnification from 3M), regarding the use of PFAS in products will involve risks, which risks may be material, and could have a material adverse effect on Solventum’s results of operations, cash flows or consolidated financial position.
The potential options available to Solventum following 2025 (after which sales by Solventum of products containing or enabled by PFAS will no longer be subject to indemnification from 3M), regarding PFAS in products will involve risks, which risks may be material, and could have a material adverse effect on Solventum’s results of operations, cash flows or consolidated financial position.
This also may require Solventum to redesign or modify its products to incorporate new components and obtain regulatory authorization, qualification or certification of these redesigned or modified products. Supplier relationships could be interrupted due to supplier material shortages, equipment malfunctions, transportation delays, inflationary pricing pressures, work stoppages, labor shortages and other disruptive events, or could be terminated.
This also may require Solventum to redesign or modify its products to incorporate new components and obtain regulatory authorization, qualification or certification of these redesigned or modified products. Supplier relationships could be interrupted due to supplier material shortages, equipment malfunctions, transportation delays, tariffs, inflationary pricing pressures, work stoppages, labor shortages and other disruptive events, or could be terminated.
Such transactions will be subject, in certain circumstances, to the consent of 3M under the Tax Matters Agreement that Solventum entered into with 3M, as discussed in “—Risks Related to the Spin-Off and Solventum’s Relationship with 3M.” There can be no assurance that any future transactions of this type will be pursued or, if pursued, will be successful.
Such transactions will be subject, in certain circumstances, to the consent of 3M under the Tax Matters Agreement that Solventum entered into with 3M, as discussed in "—Risks Related to the Spin-Off and Solventum’s Relationship with 3M." There can be no assurance that any future transactions of this type will be pursued or, if pursued, will be successful.
See “—Risks Related to the Spin-Off and Solventum’s Relationship with 3M—Following the Spin-Off, Solventum’s commercial relationships with 3M remain significant, which could adversely affect Solventum’s business, its ability to meet other obligations and the market price of its common stock.” Certain of Solventum’s products, like the products of other companies in Solventum’s industries, contain or are enabled by PFAS. 3M announced in December 2022 that it would work to discontinue the use of PFAS across its product portfolio by the end of 2025, and, as described above, 3M has agreed to indemnify Solventum for certain PFAS-related product claims related to sales of products through such date.
See "—Risks Related to the Spin-Off and Solventum’s Relationship with 3M—Following the Spin-Off, Solventum’s commercial relationships with 3M remain significant, which could adversely affect Solventum’s business, its ability to meet other obligations and the market price of its common stock." Certain of Solventum’s products, like the products of other companies in Solventum’s industries, contain or are enabled by PFAS. 3M announced in December 2022 that it would work to discontinue the use of PFAS across its product portfolio by the end of 2025, and, as described above, 3M agreed to indemnify Solventum for certain PFAS-related product claims related to sales of products through such date.
Following the Spin-Off, Solventum continues to have significant commercial relationships with 3M, including under the agreements that Solventum entered into with 3M in connection with the Spin-Off, which include the Separation and Distribution Agreement, a Transition Services Agreement, a Transition Distribution Services Agreement, a Transition Contract Manufacturing Agreement, Research and Development Master Services Agreements, Real Estate License Agreements, an Intellectual Property Cross License Agreement, a 3M Mark Use Agreement, a Transition Trademark License Agreement, Master Supply Agreements, a Tax Matters Agreement, an Employee Matters Agreement, and a Stockholder’s and Registration Rights Agreement (collectively, the “3M Agreements”), as well as 3M’s continued ownership of Solventum’s common stock and the ownership of equity interests of 3M by certain officers and directors of Solventum.
Following the Spin-Off, Solventum continues to have significant commercial relationships with 3M, including under the agreements that Solventum entered into with 3M in connection with the Spin-Off, which include the Separation and Distribution Agreement, a Transition Services Agreement, a Transition Distribution Services Agreement, a Transition Contract Manufacturing Agreement, Research and Development Master Services Agreements, Real Estate License Agreements, an Intellectual Property Cross License Agreement, a 3M Mark Use Agreement, a Transition Trademark License Agreement, Master Supply Agreements, a Tax Matters Agreement, an Employee Matters Agreement, and a Stockholder’s and Registration Rights Agreement (collectively, the "3M Agreements"), as well as 3M’s continued ownership of Solventum’s common stock and the ownership of equity interests of 3M by certain officers and directors of Solventum.
The impacts of climate change may include physical risks (e.g., rising sea levels or frequency and severity of extreme weather conditions, including natural disasters), social and human effects (e.g., population dislocations, economic disruption, political and social instability or harm to health and well-being), compliance costs and transition risks (e.g., regulatory or technology changes), shifts in market trends (e.g., customers increasingly prioritize purchasing products that are sustainably made) and other adverse effects.
The impacts of climate change may include physical risks (e.g., rising sea levels or frequency and severity of extreme weather conditions, including natural disasters), social and human effects (e.g., population dislocations, economic disruption, political and social instability or harm to health and well-being) and transition risks (e.g., regulatory or technology changes), shifts in market trends (e.g., customers increasingly prioritize purchasing products that are sustainably made) and other adverse effects.
In addition, 3M’s indemnity of Solventum with respect to certain liabilities relating to PFAS prior to Spin-Off may not be sufficient to protect Solventum against the full amount of such liabilities if, for example, 3M fails to fully satisfy its indemnification obligations or disputes whether that liability arose prior to the Spin-Off. • If Solventum does not satisfactorily perform its obligations under the 3M Agreements, it may be held liable for any resulting losses suffered by 3M, subject to certain limits.
In addition, 3M’s indemnity of Solventum with respect to certain liabilities relating to PFAS prior to Spin-Off may not be sufficient to protect Solventum against the full amount of such liabilities if, for example, 3M fails to fully satisfy its indemnification obligations or disputes whether that liability is subject to indemnification. • If Solventum does not satisfactorily perform its obligations under the 3M Agreements, it may be held liable for any resulting losses suffered by 3M, subject to certain limits.
In addition, these systems and services may also be more expensive than the amounts reflected in its historical consolidated financial statements or less efficient than the systems and services 3M is expected to provide during the transition period to Solventum. 24 Table of Contents • Solventum is relying on 3M to satisfy its obligations under the 3M Agreements not only for a successful transition but also for the success of its long-term operations.
In addition, these systems and 21 Table of Contents services may also be more expensive than the amounts reflected in its historical consolidated financial statements or less efficient than the systems and services 3M is expected to provide during the transition period to Solventum. • Solventum is relying on 3M to satisfy its obligations under the 3M Agreements not only for a successful transition but also for the success of its long-term operations.
A public health crisis, including any resurgence of the COVID-19 pandemic may limit access to these professionals, and resulting travel restrictions, shutdowns and similar measures in response to any such public health crisis may impact Solventum’s ability to maintain these relationships, which in turn would adversely affect its ability to develop, market and sell new and improved products.
A public health crisis, epidemic or pandemic, including any resurgence of the COVID-19 pandemic may limit access to these professionals, and resulting travel restrictions, shutdowns and similar measures in response to any such public health crisis may impact Solventum’s ability to maintain these relationships, which in turn would adversely affect its ability to develop, market and sell new and improved products.
Solventum agreed that, upon the request of 3M and pursuant to the terms of the stockholder’s and registration rights agreement, it will use its reasonable best efforts to effect a registration under applicable federal and state securities laws of any shares of Solventum’s common stock retained by 3M to the extent that 3M wishes to sell the shares of our common stock it retained in a registered offering. 3M’s shares are restricted securities within the meaning of Rule 144 under the Securities Act and are eligible for resale by 3M in the public market without registration subject to volume, manner of sale and holding period limitations under Rule 144 under the Securities Act.
Solventum agreed that, upon the request of 3M and 36 Table of Contents pursuant to the terms of the stockholder’s and registration rights agreement, it will use its reasonable best efforts to effect a registration under applicable federal and state securities laws of any shares of Solventum’s common stock retained by 3M to the extent that 3M wishes to sell the shares of our common stock it retained in a registered offering. 3M’s shares are restricted securities within the meaning of Rule 144 under the Securities Act and are eligible for resale by 3M in the public market without registration subject to volume, manner of sale and holding period limitations under Rule 144 under the Securities Act.
Use of these software solutions could result in Solventum’s increased vulnerability to cyber-attack, malicious intrusions, breakdowns, interference or other significant disruptions, exposure to penalties from non-compliance with emerging regulations, and may result in defects in design or manufacture or other problems that could result in system disruption or compromise the information security of Solventum’s other systems.
Use of these technology solutions could result in Solventum’s increased vulnerability to cyber-attack, malicious intrusions, breakdowns, interference or other significant disruptions, exposure to penalties from non-compliance with emerging regulations, and may result in defects in design or manufacture or other problems that could result in system disruption or compromise the information security of Solventum’s other systems.
Solventum’s future results are subject to vulnerability with respect to materials and fluctuations in the costs and availability of purchased components, compounds, raw materials, energy, production capacity and labor due to shortages, increased demand and wages, logistics, supply chain interruptions, manufacturing site disruptions, regulatory developments and other disruptive factors.
Solventum’s future results are subject to vulnerability with respect to materials and fluctuations in the costs and availability of purchased components, compounds, raw materials, energy, production capacity and labor due to shortages, increased demand and wages, logistics, supply chain interruptions, manufacturing site disruptions, regulatory developments, tariffs, inflation and other disruptive factors.
Solventum operates globally, including in some jurisdictions that pose potentially elevated risks of fraud or corruption or increased risk of internal control issues, and is subject to risks related to international, federal, state and local treaties, laws and regulations, including those involving product liability; antitrust; intellectual property; environmental, health and safety; tax; the FCPA and other anti-bribery laws; international import and export requirements and trade sanctions compliance; regulations of the U.S.
Solventum operates globally, including in some jurisdictions that pose potentially elevated risks of fraud or corruption or increased risk of internal control issues, and is subject to risks related to international, federal, state and local treaties, laws and 28 Table of Contents regulations, including those involving product liability; antitrust; intellectual property; environmental, health and safety; tax; the FCPA and other anti-bribery laws; international import and export requirements and trade sanctions compliance; regulations of the U.S.
The IRS Ruling is and any Tax Opinion were based upon and rely on, among other things, various facts and assumptions, as well as certain representations, statements and undertakings of 22 Table of Contents 3M and Solventum, including those relating to the past and future conduct of 3M and Solventum.
The IRS Ruling is and any Tax Opinion were based upon and 19 Table of Contents rely on, among other things, various facts and assumptions, as well as certain representations, statements and undertakings of 3M and Solventum, including those relating to the past and future conduct of 3M and Solventum.
The success of any such activities will depend upon a number of factors, including Solventum’s ability to: • identify suitable acquisition targets or assets, conduct due diligence, negotiate transactions on favorable terms and ultimately complete such transactions; • compete for acquisition targets and assets, which may lead to substantial increases in purchase price or terms that are less attractive to Solventum; • finance any future acquisition, investment, alliance or other transaction on terms acceptable to Solventum, if at all (which may involve the use of Solventum’s shares for payment of the purchase price); 26 Table of Contents • identify, negotiate and ultimately complete suitable divestitures or other strategic transactions; • comply with applicable laws and regulations, including foreign laws and regulations; • obtain any legally required rulings by antitrust or other regulatory bodies; • successfully and timely integrate and operate acquired businesses; • protect intellectual property and prevail in litigation relating to newly acquired technologies; • predict or realize expected growth opportunities, cost savings, synergies and market acceptance of acquired companies’ products; and • successfully identify and retain key target employees and customers.
The success of any such activities will depend upon a number of factors, including Solventum’s ability to: • identify suitable acquisition targets or assets, conduct due diligence, negotiate transactions on favorable terms and ultimately complete such transactions; • compete for acquisition targets and assets, which may lead to substantial increases in purchase price or terms that are less attractive to Solventum; • finance any future acquisition, investment, alliance or other transaction on terms acceptable to Solventum, if at all (which may involve the use of Solventum’s shares for payment of the purchase price); • identify, negotiate and ultimately complete suitable divestitures or other strategic transactions; • comply with applicable laws and regulations, including foreign laws and regulations; • obtain any legally required rulings by antitrust or other regulatory bodies; • successfully and timely integrate and operate acquired businesses; • successfully separate any divested business; • protect intellectual property and prevail in litigation relating to newly acquired technologies; • predict or realize expected growth opportunities, cost savings, synergies and market acceptance of acquired companies’ products; and • successfully identify and retain key target employees and customers.
Acquisitions, strategic alliances, divestitures and other strategic events resulting from portfolio management actions and other evolving business strategies, and possible further organizational restructuring, could affect future results. Solventum monitors its business portfolio and organizational structure and may make acquisitions, divestitures and changes to its organizational structure or enter into strategic alliances or joint ventures.
Acquisitions, strategic alliances, divestitures and other strategic events resulting from portfolio management actions and other evolving business strategies, and possible further organizational restructuring, could affect future results. Solventum monitors its business portfolio and organizational structure and may make acquisitions, divestitures and changes to its organizational structure or enter into strategic alliances, equity investments or joint ventures.
These commercial relationships could potentially have important consequences to Solventum and its investors, including: • Solventum could be negatively affected if it is required to make material payments pursuant to its indemnification obligations to 3M with respect to certain taxes (and any related costs and other damages) resulting from the separation and for uninsured liabilities related to the Bair Hugger patient warming system under the Separation and Distribution Agreement and certain other 3M Agreements.
These commercial relationships could potentially have important consequences to Solventum and its investors, including: • Solventum could be negatively affected if it is required to make material payments pursuant to its indemnification obligations to 3M such as with respect to certain taxes (and any related costs and other damages) resulting from the separation and/or for uninsured liabilities related to the Bair Hugger patient warming system under the Separation and Distribution Agreement and certain other 3M Agreements.
Department of Health and Human Services, including the Centers for Medicare & Medicaid Services (“CMS”), as well as comparable state and non-U.S. agencies responsible for reimbursement and regulation of healthcare goods and services, including laws and regulations related to kickbacks, false claims, self-referrals and healthcare fraud.
Department of Health and Human Services, including the Centers for Medicare & Medicaid Services ("CMS"), as well as comparable state and non-U.S. agencies responsible for reimbursement and regulation of healthcare goods and services, including laws and regulations related to kickbacks, false claims, self-referrals and healthcare fraud.
The U.S. and other governments have imposed export controls on certain products and financial and economic sanctions on certain industry sectors and parties in Russia. 3M suspended operations of its subsidiaries, including those of Solventum’s business, in Russia in March 2022 and, in September 2022, committed to a plan to exit the related net assets in Russia, including those of Solventum’s business, through a sale of 3M’s Russian subsidiaries that was consummated in 25 Table of Contents June 2023.
The U.S. and other governments have imposed export controls on certain products and financial and economic sanctions on certain industry sectors and parties in Russia. 3M suspended operations of its subsidiaries, including those of Solventum’s business, in Russia in March 2022 and, in September 2022, committed to a plan to exit the related net assets in Russia, including those of Solventum’s business, through a sale of 3M’s Russian subsidiaries that was consummated in June 2023.
The timing, declaration, amount and payment of any future dividend will be within the discretion of Solventum’s Board of Directors and 38 Table of Contents will depend upon many factors, including Solventum’s financial condition, earnings, capital requirements of its operating subsidiaries, covenants associated with certain of Solventum’s debt service obligations, legal requirements, regulatory constraints, industry practice, ability to access capital markets, and other factors deemed relevant by Solventum’s Board of Directors.
The timing, declaration, amount and payment of any future dividend will be within the discretion of Solventum’s Board of Directors and will depend upon many factors, including Solventum’s financial condition, earnings, capital requirements of its operating subsidiaries, covenants associated with certain of Solventum’s debt service obligations, legal requirements, regulatory constraints, industry practice, ability to access capital markets, and other factors deemed relevant by Solventum’s Board of Directors.
These regulations and standards apply to all 33 Table of Contents facilities of Solventum’s business that conduct the activities previously described, regardless of where the facilities are located, as well as the activities performed by most of Solventum’s employees, including but not limited to, sales and marketing, research and development, regulatory affairs, quality assurance, medical, affairs and operations, both before and after a product is commercially distributed.
These regulations and standards apply to all facilities of Solventum’s business that conduct the activities previously described, regardless of where the facilities are located, as well as the activities performed by most of Solventum’s employees, including but not limited to, sales and marketing, research and development, regulatory affairs, quality assurance, medical, affairs and operations, both before and after a product is commercially distributed.
If 3M does not, or is unable to, satisfy its obligations under some of the 3M Agreements, such as the Research and Development Master Services Agreements and the Master Supply Agreements, under which 3M has agreed to provide services or goods to Solventum for either a long-term duration or for a shorter transition period, as applicable, Solventum could experience significant short-term and long-term disruptions to its business or other operational difficulties or losses. • The disposition by 3M of its remaining ownership interest in Solventum, which currently represents 19.9% of the outstanding Solventum common stock, may be subject to various conditions, including receipt of any necessary regulatory and other approvals and the existence of satisfactory market conditions.
If 3M does not, or is unable to, satisfy its obligations under some of the 3M Agreements, such as the Research and Development Master Services Agreements and the Master Supply Agreements, under which 3M has agreed to provide services or goods to Solventum for either a long-term duration or for a shorter transition period, as applicable, Solventum could experience significant short-term and long-term disruptions to its business or other operational difficulties or losses. • The disposition by 3M of its remaining ownership interest in Solventum, which currently represents approximately 14.8% of the outstanding Solventum common stock, may be subject to various conditions, including receipt of any necessary regulatory and other approvals and the existence of satisfactory market conditions.
Solventum intends to monitor BEPS 2.0 and other tax-related developments in the U.S. and foreign jurisdictions, including rule changes and implementation timing, to evaluate the impact BEPS 2.0 and other tax legislation or regulation may have on Solventum’s financial results. Solventum’s tax burden could increase as a result of ongoing or future tax audits and inquiries.
Solventum intends to monitor BEPS 2.0 and other 35 Table of Contents tax-related developments in the U.S. and foreign jurisdictions, including rule changes and implementation timing, to evaluate the impact BEPS 2.0 and other tax legislation or regulation may have on Solventum’s financial results. Solventum’s tax burden could increase as a result of ongoing or future tax audits and inquiries.
Solventum is also subject to compliance risks related to legal or regulatory requirements, contract requirements, policies and practices or other matters that require or encourage Solventum and its suppliers, vendors or channel parties, to conduct business in a certain way, and Solventum’s activity as well as the activity of 30 Table of Contents such suppliers, vendors or channel parties could adversely affect Solventum’s business.
Solventum is also subject to compliance risks related to legal or regulatory requirements, contract requirements, policies and practices or other matters that require or encourage Solventum and its suppliers, vendors or channel parties, to conduct business in a certain way, and Solventum’s activity as well as the activity of such suppliers, vendors or channel parties could adversely affect Solventum’s business.
Solventum’s failure to comply with these laws could 34 Table of Contents result in contract terminations, suspension or debarment from contracting with these entities, civil fines and damages, criminal prosecution and possible exclusion from participation in federal healthcare programs such as Medicare and Medicaid, as well as possible recoupment of any overpayments related to such violations.
Solventum’s failure to comply with these laws could result in contract terminations, suspension or debarment from contracting with these entities, civil fines and damages, criminal prosecution and possible exclusion from participation in federal healthcare programs such as Medicare and Medicaid, as well as possible recoupment of any overpayments related to such violations.
The ability to bring new products and services to market is subject to difficulties or delays in development, such as the inability to identify viable new products and services, obtain adequate intellectual property protection, regulatory approvals and reimbursement in the U.S. and abroad and successfully complete clinical trials or gain market acceptance of new products and services.
The ability to bring new products and services to market is subject to difficulties or delays in development, such as the inability to identify viable new products and services, obtain adequate intellectual property 26 Table of Contents protection, regulatory approvals and reimbursement in the U.S. and abroad and successfully complete clinical trials or gain market acceptance of new products and services.
In particular, a portion of Solventum’s revenues is derived from jurisdictions where adequately protecting intellectual property rights may prove more 36 Table of Contents challenging or impossible. In addition, the laws of many jurisdictions may not provide an adequate forum to effectively address situations where Solventum’s intellectual property rights have been compromised.
In particular, a portion of Solventum’s revenues is derived from jurisdictions where adequately protecting intellectual property rights may prove more challenging or impossible. In addition, the laws of many jurisdictions may not provide an adequate forum to effectively address situations where Solventum’s intellectual property rights have been compromised.
Solventum is exposed to changes in interest rates, including through variable rate debt and due to the fact that increases in interest rates may adversely affect the financial condition of Solventum’s counterparties in a manner that may affect their ability to transact with Solventum or their demand for Solventum’s products and services.
Solventum is exposed to changes in interest rates, including through variable rate debt and due to the fact that increases in interest rates may adversely affect the financial condition of Solventum’s counterparties in a manner that may affect their ability 25 Table of Contents to transact with Solventum or their demand for Solventum’s products and services.
For example, o-rings, gaskets and seals and are used in filters needed for high stress process conditions, molded plastic parts are used in the plastic housing of perioperative temperature management devices, medical grade membranes are used in negative pressure wound therapy fluid canisters, release liners are used with adhesive dressings, circuit boards are used in electronic hardgoods, such as negative pressure wound therapy devices, and lithium ion batteries are included in surgical clippers.
Examples include o-rings, gaskets and seals used in filters needed for high stress process conditions, molded plastic parts used in the plastic housing of perioperative temperature management devices, medical grade membranes used in negative pressure wound therapy fluid canisters, release liners used with adhesive dressings, circuit boards used in electronic hardgoods, such as negative pressure wound therapy devices, and lithium ion batteries included in surgical clippers.
These provisions may also prevent or discourage attempts to remove and replace incumbent directors. In addition, an acquisition or further issuance of Solventum stock could trigger the application of Section 355(e) of the Code, causing the Spin-Off to be taxable to 3M.
These provisions may also prevent or discourage attempts to remove and replace incumbent directors. 37 Table of Contents In addition, an acquisition or further issuance of Solventum stock could trigger the application of Section 355(e) of the Code, causing the Spin-Off to be taxable to 3M.
As an 32 Table of Contents independent company, Solventum is generally responsible for all PFAS-related liabilities resulting from its business, operations and activities following the Spin-Off, subject to the indemnification by 3M of certain liabilities relating to certain Solventum products sold through 2025.
As an independent company, Solventum is generally responsible for all PFAS-related liabilities resulting from its business, operations and activities following the Spin-Off, subject to the indemnification by 3M of certain liabilities relating to certain Solventum products sold through 2025.
Such events could lead to recalls or safety alerts relating to Solventum’s products (either voluntary or as required by the FDA or similar governmental authorities in other countries), and could result, in certain cases, in the removal of a product from the market.
Such events could lead to recalls or safety alerts relating to Solventum’s products (either voluntary or as required by the FDA or similar governmental authorities in other countries), and could result, in certain cases, in the removal of 33 Table of Contents a product from the market.
Demand for Solventum’s products and services, which impacts revenue and profit margins, will be affected by, among other things, (i) the development and timing of the introduction of competitive products and services; (ii) Solventum’s pricing strategies; (iii) changes in customer order patterns, such as changes in the levels of inventory maintained by customers, vendors or channel partners; (iv) changes in customers’ preferences for Solventum’s products and services, including the success of products and services offered by competitors; (v) changes in customer designs for their products and services that can affect the demand for Solventum’s products and services; (vi) changes in the business environment related to disruptive technologies, such as artificial intelligence, block-chain, expanded analytics and other enhanced learnings from increasing volume of available data; (vii) local market conditions, such as mandatory intellectual property transfers, protectionist measures and other government policies supporting increased local competition; (viii) costs of production or delivery, whether due to geographic location, currency fluctuations, taxes, duties or otherwise; (ix) the perception of Solventum’s brand and image in the market; (x) changing regulatory standards, legal requirements or enforcement rigor; (xi) failure to acquire or effectively integrate businesses and technologies that complement or expand Solventum’s existing businesses; and (xii) consolidation among customers, suppliers, channel partners or competitors.
Demand for Solventum’s products and services, which impacts revenue and profit margins, will be affected by, among other things, (i) the development and timing of the introduction of competitive products and services; (ii) Solventum’s pricing strategies; (iii) changes in customer order patterns, such as changes in the levels of inventory maintained by customers, vendors or channel partners; (iv) changes in customers’ preferences for Solventum’s products and services, including the success of products and services offered by competitors; (v) changes in customer designs for their products and services that can affect the demand for Solventum’s products and services; (vi) the emergence of new AI-enabled competitors and business model disruption, particularly for our HIS business; (vii) changes in the business environment related to disruptive technologies, such as AI, block-chain, expanded analytics and other enhanced learnings from increasing volume of available data; (viii) local market conditions, such as mandatory intellectual property transfers, protectionist measures and other government policies supporting increased local competition; (ix) costs of production or delivery, whether due to geographic location, currency fluctuations, taxes, duties or otherwise; (x) the perception of Solventum’s brand and image in the market; (xi) changing regulatory standards, legal requirements or enforcement rigor; (xii) failure to acquire or effectively integrate businesses and technologies that complement or expand Solventum’s existing businesses; and (xiii) consolidation among customers, suppliers, channel partners or competitors.
Following the Spin-Off, Solventum’s may be more vulnerable to changing market conditions and therefore more volatile. • Prior to the Spin-Off, 3M or one of its affiliates performed various corporate functions for Solventum’s business such as information technology, legal, treasury, accounting, auditing, human resources, investor relations and finance.
Following the Spin-Off, Solventum’s results of operations or cash flows may be more vulnerable to changing market conditions and therefore more volatile. • Prior to the Spin-Off, 3M or one of its affiliates performed various corporate functions for Solventum’s business such as information technology, legal, treasury, accounting, auditing, human resources, investor relations and finance.
In addition, some of Solventum’s suppliers are limited- or sole-source suppliers, and Solventum’s ability to meet its obligations to customers depends on the performance, product quality and stability of such suppliers and Solventum’s ability to source 29 Table of Contents alternatives in a cost effective manner.
In addition, some of Solventum’s suppliers are limited- or sole-source suppliers, and Solventum’s ability to meet its obligations to customers depends on the performance, product quality and stability of such suppliers and Solventum’s ability to source alternatives in a cost effective manner.
Our reputation or our brands could also be adversely affected by negative publicity related to our industry, our competitors, our competitors’ products, our customers or our third-party partners, including healthcare professionals, and other individuals with whom we have relationships, even if the publicity is not directly related to our company or our brands and even if the publicity is not accurate.
Our reputation or our brands could 23 Table of Contents also be adversely affected by negative publicity related to our industry, our competitors, our competitors’ products, our customers or our third-party partners, including healthcare professionals, and other individuals with whom we have relationships, even if the publicity is not directly related to our company or our brands and even if the publicity is not accurate.
Although Solventum maintains general liability insurance to mitigate monetary exposure, the amount of liability that may result from certain of these risks may not always be covered by, or could exceed, the applicable insurance coverage.
Although Solventum maintains general liability insurance to mitigate monetary exposure, the amount of liability 30 Table of Contents that may result from certain of these risks may not always be covered by, or could exceed, the applicable insurance coverage.
The process of obtaining regulatory clearances and/or approvals to market and sell Solventum’s products can be rigorous, costly and time-consuming and the clearances and/or approvals might not be granted timely or result in limitations on the indicated uses of products.
The process of obtaining regulatory clearances and/or approvals to 32 Table of Contents market and sell Solventum’s products can be rigorous, costly and time-consuming and the clearances and/or approvals might not be granted timely or result in limitations on the indicated uses of products.
In particular, Solventum could be negatively impacted by the Base Erosion and Profit Shifting 2.0 initiative (“BEPS 2.0”) by the Organization for Economic Cooperation and Development (“OECD”) which, if enacted by OECD member countries, would likely impact the amount of tax that multinationals, such as Solventum, pay in the future.
In particular, Solventum could be negatively impacted by the Base Erosion and Profit Shifting 2.0 initiative ("BEPS 2.0") by the Organization for Economic Cooperation and Development ("OECD") which, if enacted by OECD member countries, would likely impact the amount of tax that multinationals, such as Solventum, pay in the future.
Any failure to achieve and maintain effective internal controls could have a material adverse effect on its business, financial condition, results of operations and cash flows. 21 Table of Contents In connection with the Spin-Off, Solventum incurred debt obligations and may incur additional obligations in the future, which could adversely affect its business and profitability and its ability to meet other obligations.
Any failure to achieve and maintain effective internal controls in a timely, effective and cost-effective manner could have a material adverse effect on its business, financial condition, results of operations and cash flows. 18 Table of Contents In connection with the Spin-Off, Solventum incurred debt obligations and may incur additional obligations in the future, which could adversely affect its business and profitability and its ability to meet other obligations.
As a manufacturer of products reimbursable by federal healthcare programs, Solventum is subject to the Physician Payments Sunshine Act, which requires it to annually report certain payments and other transfers of value it makes to U.S.-licensed physicians or U.S. teaching hospitals.
As a manufacturer of products reimbursable by federal healthcare programs, Solventum is subject to the Physician Payments Sunshine Act, which requires it to annually report certain payments and other transfers of value it makes to U.S.-licensed physicians and certain advanced practice providers, and U.S. teaching hospitals.
Solventum’s business relies on the secure electronic transmission, storage and hosting of sensitive information, including personal information, protected health information, financial information, intellectual property and other sensitive information related to our customers 31 Table of Contents and workforce.
Solventum’s business relies on the secure electronic transmission, storage and hosting of sensitive information, including personal information, protected health information, financial information, intellectual property and other sensitive information related to our customers and workforce.
If Solventum loses suppliers, if their operations are substantially interrupted, if their prices continue to increase significantly due to inflationary pressures, or if any of them fail to meet performance or quality specifications, Solventum may be required to identify and qualify one or more replacement suppliers.
If Solventum loses suppliers, if their operations are substantially interrupted, if their prices continue to increase significantly due to tariffs or inflationary pressures, or if any of them fail to meet performance or quality specifications, Solventum may be 27 Table of Contents required to identify and qualify one or more replacement suppliers.
As noted above, many companies in Solventum’s industries use PFAS-containing products and components, and Solventum believes that its use of such products and components is of a nature and magnitude that is broadly consistent with that of other companies in these industries.
Many companies in Solventum’s industries use PFAS-containing products and components, and Solventum believes that its use of such products and components is of a nature and magnitude that is broadly consistent with that of other companies in these industries.
Internal Revenue Service (the “IRS”) regarding certain U.S. federal income tax matters relating to the Spin-Off, including the qualification of the Spin-Off, together with certain related transactions, as a transaction that is generally tax-free for U.S. federal income tax purposes pursuant to Sections 355 and 368(a)(1)(D) of the Internal Revenue Code of 1986, as amended (the “Code,” such qualification, “U.S.
Internal Revenue Service (the "IRS") regarding certain U.S. federal income tax matters relating to the Spin-Off, including the qualification of the Spin-Off, together with certain related transactions, as a transaction that is generally tax-free for U.S. federal income tax purposes pursuant to Sections 355 and 368(a)(1)(D) of the Internal Revenue Code of 1986, as amended (the "Code," such qualification, "U.S.
Because Solventum’s financial statements are denominated in U.S. dollars and a material percentage of its revenues are derived from outside the U.S., Solventum’s results of operations and its ability to realize projected growth rates in sales and earnings could be adversely affected if the value of the U.S. dollar strengthens significantly against foreign currencies.
Because Solventum’s financial statements are denominated in U.S. dollars and a material percentage of its revenues are derived from outside the U.S., Solventum’s results of operations and its ability to realize projected growth rates in sales and earnings could be adversely affected by volatility in foreign currency exchange rates, particularly if the value of the U.S. dollar strengthens significantly against foreign currencies.
Our reputation and our brands could in the future be damaged by negative publicity, whether or not valid. Negative publicity could relate to our company, our brands, our products, our supply chain, our ingredients, our packaging, our ESG practices, our employees or any other aspect of our business.
Our reputation and our brands could in the future be damaged by negative publicity, whether or not valid. Negative publicity could relate to our company, our brands, our products, our supply chain, our ingredients, our packaging, our sustainability and social impact practices, our employees or any other aspect of our business.
Any failure to comply with these laws and regulations could subject Solventum or its officers and employees to criminal and civil financial penalties. • Data Privacy and Cybersecurity Laws - Because Solventum is a business with a significant global footprint, compliance with evolving regulations and standards in data privacy and cybersecurity may result in increased costs, compliance challenges and the threat of increased regulatory enforcement activity.
Any failure to comply 29 Table of Contents with these laws and regulations could subject Solventum or its officers and employees to criminal and civil financial penalties. • Data Privacy, Emerging Technology and Cybersecurity Laws - Because Solventum is a business with a significant global footprint, compliance with evolving regulations and standards in data privacy, emerging technologies, and cybersecurity may result in increased costs, compliance challenges and the threat of increased regulatory enforcement activity.
If Solventum’s information technology systems, products or services or sensitive data are compromised, there are many consequences that could result including, but not limited to, patients or employees being exposed to financial or medical identity theft or suffering a loss of product functionality; losing existing customers or having difficulty attracting new customers; experiencing difficulty preventing, detecting and controlling fraud; being exposed to the loss or misuse of confidential information; having disputes with customers, physicians and other healthcare professionals; experiencing increases in operating expenses or an impairment in its ability to conduct its operations; incurring expenses or losing revenues as a result of a data privacy breach, product failure, information technology outages or disruptions; voluntary or forced recalls or modifications to Solventum’s products; or suffering other adverse consequences including time-consuming and expensive lawsuits or other legal action and damage to Solventum’s reputation.
If Solventum’s information technology systems, products or services or sensitive data are compromised, there are many consequences that could result including, but not limited to, patients or employees being exposed to financial or medical identity theft or suffering a loss of product functionality; losing existing customers or having difficulty attracting new customers; experiencing difficulty preventing, detecting and controlling fraud; being exposed to the loss or misuse of confidential information; having disputes with customers, physicians and other healthcare professionals; experiencing increases in operating expenses or an impairment in its ability to conduct its operations; incurring expenses or losing revenues as a result of a data privacy breach, product failure, information technology outages or disruptions; voluntary or forced recalls or modifications to Solventum’s products; or suffering other adverse consequences including time-consuming and expensive lawsuits or other legal action and damage to Solventum’s reputation. 34 Table of Contents Solventum is subject to numerous international, federal and state privacy and security laws.
In addition to the risks associated with enforcement activities and potential contractual liabilities, Solventum’s ongoing efforts to comply with evolving laws and regulations may be costly and require ongoing modifications to its policies, procedures and systems.
In addition to the risks associated with enforcement activities and potential contractual liabilities, Solventum’s ongoing efforts to comply with evolving laws and regulations may be costly and require ongoing modifications or limitations to its products, services, policies, procedures and systems.
Accordingly, 3M shareholders may sell large amounts of Solventum common stock in the open market, and Solventum is unable to predict whether and when such sales would occur. 3M holds 19.9% of Solventum’s outstanding common stock.
Accordingly, 3M shareholders may sell large amounts of Solventum common stock in the open market, and Solventum is unable to predict whether and when such sales would occur. 3M holds 14.8% of Solventum’s outstanding common stock.
Among other benefits, Solventum’s business historically had access to 3M’s 20 Table of Contents extensive global research and development resources, which historically enhanced its ability to innovate, develop new products and technologies, and improve and update existing products and technologies.
Among other benefits, Solventum’s business historically had access to 3M’s extensive global research and development resources, which historically enhanced its ability to innovate, develop new products and technologies, and improve and update existing products and technologies.
That technology includes systems that could be used to process, transmit and store sensitive information, including personal information, protected health information, employee data, financial 35 Table of Contents information, intellectual property, clinical data and sales and marketing data.
That technology includes systems that could be used to process, transmit and store sensitive information, including personal information, protected health information, employee data, financial information, intellectual property, clinical data and sales and marketing data.
For example, changes in the policies or practices of government programs, authorities or agencies (e.g., Medicare and Medicaid in the U.S.) resulting from the change in the U.S. presidential administration could adversely impact the amount of funding Solventum’s customers have for its products and services.
For example, changes in the policies or practices of government programs, authorities or agencies (e.g., Medicare and Medicaid in the U.S.) could adversely impact the amount of funding Solventum’s customers have for its products and services.
Solventum may not achieve these and other anticipated benefits for a variety of reasons, including, among others: (1) the operation of Solventum as a standalone public company continues to demand significant management resources and require significant amounts of management’s time and effort, which may divert management’s attention from operating and growing Solventum’s business; (2) Solventum may continue to be required to pay costs that could be substantial and material to its financial resources, including accounting, tax, legal and other professional services costs, recruiting and relocation costs associated with hiring key senior management and personnel new to Solventum, tax costs and other costs; and (3) operational challenges as a standalone company, including those related to customer service, pace of change and productivity improvements, could result in additional expenses or reductions in productivity.
Solventum may not achieve these and other anticipated benefits for a variety of reasons, including, among others: (1) the operation of Solventum as a standalone public company continues to demand significant management resources and require significant amounts of management’s time and effort, which may divert management’s attention from operating and growing Solventum’s business; (2) Solventum may continue to be required to pay costs that could be substantial and material to its financial resources, including costs associated with separating its operations from 3M and for related transition services, as well as increased accounting, tax, legal and other professional services costs; and (3) operational challenges as a standalone company, including those related to customer service, pace of change and productivity improvements, could result in additional expenses or reductions in productivity.
Risks Related to the Spin-Off and Solventum’s Relationship with 3M Solventum’s historical financial information for periods prior to the Spin-Off is not necessarily representative of the results or performance that it would have achieved as a separate, publicly traded company and may not be a reliable indicator of its future results or performance.
See "Special Note Regarding Forward-Looking Statements and Information." Risks Related to the Spin-Off and Solventum’s Relationship with 3M Solventum’s historical financial information for periods prior to the Spin-Off is not necessarily representative of the results or performance that it would have achieved as a separate, publicly traded company and may not be a reliable indicator of its future results or performance.
If Solventum or third parties fail to adequately safeguard confidential personal data, or if such information or data are wrongfully used by Solventum or third parties or disclosed to unauthorized persons or entities, such an event could result in a material adverse effect on its business, results of operations, financial condition and cash flows. • ESG and Climate Change - There has been increased focus in recent years by federal, international, state and local regulatory and legislative bodies to expand mandatory ESG reporting, diligence and disclosure requirements, including the European Union’s Corporate Sustainability Reporting Directive (CSRD), the recently enacted legislation in California requiring reporting of greenhouse gas emissions and climate risk and similar regulatory requirements in other jurisdictions.
If Solventum or third parties are unable to effectively manage the use of AI or other emerging technologies by employees and third party providers, Solventum or third parties may fail to adequately safeguard confidential personal data, or if such information or data are wrongfully used by Solventum or third parties or disclosed to unauthorized persons or entities, such an event could result in a material adverse effect on its business, results of operations, financial condition and cash flows. • Sustainability and Climate Change - There has been increased focus in recent years by federal, international, state and local regulatory and legislative bodies to expand mandatory sustainability reporting, diligence and disclosure requirements, including the European Union’s Corporate Sustainability Reporting Directive (CSRD), legislation in California requiring reporting of greenhouse gas emissions and climate risk and similar regulatory requirements in other jurisdictions.
Under the Tax Matters Agreement, Solventum would be required to indemnify 3M for the resulting tax, and this indemnity obligation might discourage, delay or prevent a change of control that Solventum shareholders may consider favorable.
Under the Tax Matters Agreement, Solventum would be required to indemnify 3M for the resulting tax, and this indemnity obligation might discourage, delay or prevent a change of control that Solventum shareholders may consider favorable. Item 1B. Unresolved Staff Comments None.
There have been accelerating regulatory and legislative activities concerning PFAS in the U.S., Europe and elsewhere, including increasingly strict restrictions on various uses of PFAS in products, as well as increased litigation relating to PFAS being filed against other parties.
There have been accelerating regulatory and legislative activities concerning PFAS globally, including increasingly strict restrictions on various uses of PFAS in products, as well as increased litigation relating to PFAS being filed against other parties.
Due to Solventum’s global operations, Solventum’s business is and will be impacted by public health crises such as the COVID-19 pandemic in the locations in which Solventum or its suppliers or customers operate, and these events have adversely affected, and could in the future adversely affect, Solventum’s operations and financial performance.
Due to Solventum’s global operations, Solventum’s business is and will be impacted by public health crises, epidemics and pandemics in the locations in which Solventum or its suppliers or customers operate, and these events have adversely affected, and could in the future adversely affect, Solventum’s operations and financial performance.
To the extent 3M does not prosecute infringement of the intellectual property licensed to Solventum, such intellectual property will not be protected and continued infringement of such intellectual property could result in a material adverse effect on Solventum’s business, results of operations, financial condition and cash flows.
To the extent 3M and Solventum cannot align on prosecuting infringement of the intellectual property licensed to Solventum, such intellectual property may not be protected and continued infringement of such intellectual property could result in a material adverse effect on Solventum’s business, results of operations, financial condition and cash flows.
Solventum has adopted transfer pricing policies that determine how income is allocated to each of the income tax jurisdictions in which Solventum operates, based on current interpretations of complex income tax regulations.
Solventum operates in multiple income tax jurisdictions both in the U.S. and internationally. Solventum has adopted transfer pricing policies that determine how income is allocated to each of the income tax jurisdictions in which Solventum operates, based on current interpretations of complex income tax regulations.
Securities Act of 1933, as amended (the “Securities Act”), except for shares owned by Solventum’s “affiliates,” as that term is defined in Rule 405 under the Securities Act.
Securities Act of 1933, as amended (the "Securities Act"), except for shares owned by Solventum’s "affiliates," as that term is defined in Rule 405 under the Securities Act.
Solventum may be unable to obtain, maintain, protect or effectively enforce its intellectual property rights. Solventum is substantially dependent on patent and other proprietary rights and relies on a combination of patents, trademarks, tradenames, copyrights, trade secrets and agreements (such as employee, non-disclosure and non-competition agreements) to protect its business and proprietary intellectual property.
Solventum is substantially dependent on patent and other proprietary rights and relies on a combination of patents, trademarks, tradenames, copyrights, trade secrets and agreements (such as employee, non-disclosure and non-competition agreements) to protect its business and proprietary intellectual property.
Solventum’s lack of access to 3M’s research and development resources may negatively impact it. • The cost of capital for Solventum’s business may be higher than 3M’s cost of capital prior to the Spin-Off, and Solventum may need to obtain additional financing from banks, through public offerings or private placements of debt or equity securities, strategic relationships or other arrangements in order to fund capital expenditures and investments, pay dividends and service debt, which may or may not be available and may be more costly. • Solventum’s historical financial information for periods prior to the Spin-Off does not reflect the debt that Solventum incurred as part of the Spin-Off. • As an independent public company, Solventum is subject to public company reporting requirements under the Exchange Act, and is required to prepare its standalone financial statements according to the rules and regulations required by the SEC.
Solventum’s lack of access to 3M’s research and development resources may negatively impact it. • The cost of capital for Solventum’s business may be higher than 3M’s cost of capital prior to the Spin-Off, and Solventum may need to obtain additional financing from banks, through public offerings or private placements of debt 17 Table of Contents or equity securities, strategic relationships or other arrangements in order to fund capital expenditures and investments, return capital to shareholders or service debt, which may or may not be available and may be more costly. • Solventum’s historical financial information for periods prior to the Spin-Off does not reflect the debt that Solventum incurred as part of the Spin-Off. • Solventum has and will continue to incur costs in connection with the separation from 3M and the related transition agreements entered into with 3M. • As an independent public company, Solventum is subject to public company reporting requirements under the Exchange Act, and is required to prepare its standalone financial statements according to the rules and regulations required by the SEC.
Tax-Free Status” and, such ruling, the “IRS Ruling”) be valid; and (2) 3M received one or more opinions of 3M’s tax advisors regarding U.S. Tax-Free Status (each, a “Tax Opinion”).
Tax-Free Status" and, such ruling, the "IRS Ruling") be valid; and (2) 3M received one or more opinions of 3M’s tax advisors regarding U.S. Tax-Free Status (each, a "Tax Opinion").
Solventum’s business is also impacted by social, political and labor conditions in locations in which Solventum or its suppliers or customers operate; adverse changes in the availability and cost of capital; monetary policy; interest rates; inflation; recession; commodity prices; currency volatility or exchange control; ability to expatriate earnings; and other laws and regulations in the jurisdictions in which Solventum or its suppliers or customers operate.
Solventum’s business is also impacted by social, political and labor conditions in locations in which Solventum or its suppliers or customers operate; adverse changes in the availability and cost of capital; monetary policy; interest rates; inflation; recession; commodity prices; currency volatility or exchange control; ability to expatriate earnings; and other laws and regulations in the jurisdictions in which Solventum or its suppliers or customers operate. 22 Table of Contents The global economy has been impacted by the conflicts between Russia and Ukraine and in the Middle East and other geopolitical events.
Solventum works with leading global healthcare professionals who provide considerable knowledge and experience. The research, development, marketing and sales of many of Solventum’s products depend on maintaining working relationships with healthcare professionals. Solventum relies on these professionals for assistance in the development and marketing of its products.
The research, development, marketing and sales of many of Solventum’s products depend on maintaining working relationships with healthcare professionals. Solventum relies on these professionals for assistance in the development and marketing of its products.
If Solventum cannot successfully introduce new products and services that address the needs of its customers, Solventum’s offerings may become obsolete, and its business results, cash flows and financial condition could suffer. 28 Table of Contents The success of many of Solventum’s products depends upon certain key healthcare professionals.
If Solventum cannot successfully introduce new products and services that address the needs of its customers, Solventum’s offerings may become obsolete, and its business results, cash flows and financial condition could suffer. The success of many of Solventum’s products depends upon certain key healthcare professionals. Solventum works with leading global healthcare professionals who provide considerable knowledge and experience.
In addition, privacy laws and regulations are becoming stricter and may potentially impose additional requirements on Solventum’s business, and certain jurisdictions have implemented data localization laws which can be costly and operationally difficult to satisfy. Solventum cannot be sure how these laws and regulations will be interpreted, enforced or applied to its operations.
In addition, privacy laws and regulations are becoming stricter and may potentially impose additional requirements on Solventum’s business, and certain jurisdictions have implemented data localization laws which can be costly and operationally difficult to satisfy.
Following the Spin-Off, Solventum now operates under its own brand and accordingly may no longer benefit from 3M’s long operating history, reputation and well-known brand.
Our ability to compete successfully depends on the strength of our brands. Following the Spin-Off, Solventum now operates under its own brand and accordingly may no longer benefit from 3M’s long operating history, reputation and well-known brand.
Products sold by Solventum’s competitors may infringe, misappropriate or otherwise violate intellectual property rights owned or licensed by Solventum and such infringement, misappropriation or violation may be undetected by Solventum. In addition, as Solventum’s patents expire, Solventum may be unsuccessful in extending their protection through patent term extensions.
Products sold by Solventum’s competitors may infringe, misappropriate or otherwise violate intellectual property rights owned or licensed by Solventum and such infringement, misappropriation or violation may be undetected by Solventum. In addition, as Solventum’s patents will expire in the normal course.
Solventum has also taken actions to meet this goal while owned by 3M, and, except as described below, Solventum intends to continue to work toward this goal. In addition, Solventum understands that 3M intends to cease supplying Solventum with PFAS-related products or components by the end of 2025.
Solventum has also taken actions to meet this goal while owned by 3M, and, except as described below, Solventum intends to minimize the use of PFAS in products wherever feasible. 3M ceased supplying Solventum with PFAS-related products or components at the end of 2025.
If such consents or approvals were not obtained, Solventum may not be entitled to the full benefit of such contracts, permits and other assets and rights, which could increase its expenses or otherwise harm its business and financial performance. 23 Table of Contents The Separation and Distribution Agreement provided that certain contracts, permits and other assets and rights were to be transferred from 3M or its subsidiaries to Solventum or its subsidiaries in connection with the separation.
If such consents or approvals were not 20 Table of Contents obtained, Solventum may not be entitled to the full benefit of such contracts, permits and other assets and rights, which could increase its expenses or otherwise harm its business and financial performance.
Public health crises such as the COVID-19 pandemic may increase Solventum’s cost of doing business and disrupt Solventum’s operations.
Public health crises may increase Solventum’s cost of doing business and disrupt Solventum’s operations.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeFor further discussion of the risks associated with cybersecurity incidents, see the cybersecurity risk factor of the section entitled “Item 1A. Risk Factors” in this Form 10-K.
Biggest changeDespite our cybersecurity program, there can be no assurance that we, or third parties with which we interact, will not experience a cybersecurity incident in the future that may materially affect us. For further discussion of the risks associated with cybersecurity incidents, see the cybersecurity risk factor of the section entitled "Item 1A. Risk Factors" in this Form 10-K.
The CISO has over 25 years of experience in cybersecurity, risk management, and compliance, and has served as the chief information security officer at other organizations. The Company’s CISO oversees the Company’s cybersecurity incident response plan and related processes that are designed to assess and manage material risks from cybersecurity threats.
The CISO has over 25 years of experience in cybersecurity, risk management, and compliance, and has served as the chief information security officer at other organizations. 38 Table of Contents The Company’s CISO oversees the Company’s cybersecurity incident response plan and related processes that are designed to assess and manage material risks from cybersecurity threats.
The Cybersecurity Subcommittee of the Disclosure Committee is comprised of the Controller and Chief Accounting Officer, Treasurer, Chief Legal Affairs Officer, Assistant Secretary, General Auditor, as well as the CISO, CIO and Chief Privacy 40 Table of Contents Officer.
The Cybersecurity Subcommittee of the Disclosure Committee is comprised of the Controller and Chief Accounting Officer, Treasurer, Chief Corporate & Legal Affairs Officer, Assistant Secretary, General Auditor, as well as the CISO, CIO and Chief Privacy Officer.
The Audit Committee regularly receives reports from our Chief Information Security Officer (“CISO”), Chief Information and Digital Officer (“CIO”) and other members of management on cybersecurity threat risk management, including security posture improvements, results from third-party assessments, identified risks and progress towards risk-mitigation-related goals. The full Board receives a report from our CISO and other members of management annually.
The Audit Committee regularly receives reports from our Chief Information Security Officer ("CISO"), Chief Information and Digital Officer ("CIO") and other members of management on cybersecurity threat risk management, including security posture improvements, results from third-party assessments, identified risks and progress towards risk-mitigation-related goals.
Management Our cybersecurity risk management and strategy processes are led by our CISO. The CISO works closely with the CIO, Chief Privacy Officer, and members of the legal team who report to the Chief Legal Affairs Officer to periodically review the cybersecurity program.
The CISO works closely with the CIO, Chief Privacy Officer, and members of the legal team who report to the Chief Corporate & Legal Affairs Officer to periodically review the cybersecurity program.
We identify and assess cybersecurity risk through various technologies, processes and policies that are regularly updated to align with the changing threat landscape, evolving business needs, as well as global regulatory requirements.
ERM is overseen by the Company’s board of directors (the "Board"), primarily through its committees, with its Audit Committee having direct oversight over cybersecurity matters. We identify and assess cybersecurity risk through various technologies, processes and policies that are regularly updated to align with the changing threat landscape, evolving business needs, as well as global regulatory requirements.
The Company’s CISO also coordinates with the Company’s Legal Affairs team and third parties, such as consultants and legal advisors, to assess and manage material risks from cybersecurity threats. The Company’s CISO is informed about and monitors the prevention, detection, mitigation, and remediation of cybersecurity incidents pursuant to criteria set forth in the Company’s incident response plan and related processes.
The Company’s CISO is informed about and monitors the prevention, detection, mitigation, and remediation of cybersecurity incidents pursuant to criteria set forth in the Company’s incident response plan and related processes.
Item 1C. Cybersecurity Risk Management The Company has practices and procedures designed to proactively and comprehensively manage risks from cybersecurity threats. These processes are integrated into the Company’s overall enterprise risk management, as overseen by the Company’s board of directors (the “Board”), primarily through its committees, with its Audit Committee having direct oversight over cybersecurity matters.
Item 1C. Cybersecurity Risk Management The Company has practices and procedures designed to proactively and comprehensively manage risks from cybersecurity threats. These processes are integrated into the Company’s overall enterprise risk management ("ERM"), which establishes a risk management framework that seeks to identify, assess, and manage risks across our business.
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The full Board receives a report from our CISO and other members of management on cybersecurity at least annually. Management Our cybersecurity risk management and strategy processes are led by our CISO.
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The Company’s CISO also coordinates with the Company’s Corporate & Legal Affairs team and third parties, such as consultants and legal advisors, to assess and manage material risks from cybersecurity threats.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeThe Company owns, leases or otherwise has rights to use approximately 277 facilities consisting of approximately 22 facilities owned and approximately 255 facilities that are leased or otherwise have rights to use. The Company's has 10 manufacturing facilities in the United States and 18 outside of the United States, including Canada, China, France, Germany, Ireland, Mexico, and Poland.
Biggest changeThe Company owns, leases or otherwise has rights to use approximately 270 facilities consisting of 20 owned facilities and approximately 250 facilities that are leased or otherwise have rights to use. The Company has 7 manufacturing facilities in the United States and 14 outside of the United States, including Canada, China, Germany, Ireland, Mexico, and Poland.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeItem 3. Legal Proceedings Discussion of legal matters is incorporated by reference from Part II, Item 8, Note 11, “ Commitments and Contingencies, ” to the consolidated financial statements, and should be considered an integral part of Part I, Item 3, “ Legal Proceedings. ”
Biggest changeItem 3. Legal Proceedings Discussion of legal matters is incorporated by reference from Part II, Item 8, Note 12, "Commitments and Contingencies," to the consolidated financial statements, and should be considered an integral part of Part I, Item 3, "Legal Proceedings."

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeCompany/Index April 1, 2024 June 30, 2024 September 30, 2024 December 31. 2024 Solventum Corporation $ 100.00 $ 76.53 $ 100.90 $ 95.60 S&P 500 Index 100.00 104.13 109.89 112.16 S&P 500 Health Care Index 100.00 99.50 100.90 93.91 Item 6. [Reserved]
Biggest changeCompany/Index April 1, 2024 June 30, 2024 December 31, 2024 June 30, 2025 December 31, 2025 Solventum Corporation $ 100.00 $ 76.53 $ 95.60 $ 109.75 $ 114.67 S&P 500 Index 100.00 104.13 112.16 118.33 130.55 S&P 500 Health Care Index 100.00 99.50 93.91 92.02 105.68
The graph assumes $100 was invested in each of these indices on April 1, 2024, the first day of “regular way” trading, for the Company's common stock. The comparisons are based on historical data and are not indicative of, nor intended to forecast, the future performance of the Company's common stock.
The graph assumes $100 was invested in each of these indices on April 1, 2024, the first day of "regular way" trading, for the Company's common stock. The comparisons are based on historical data and are not indicative of, nor intended to forecast, the future performance of the Company's common stock.
Stock Performance Graph The following graph compares the total shareholder return on the Company's common stock for the last 9 months since the company started trading on April 1, 2024 with the Standard & Poor's (“S&P”) 500 and S&P 500 Healthcare indices.
Stock Performance Graph The following graph compares the total shareholder return on the Company's common stock for the last 21 months since the company started trading on April 1, 2024 with the Standard & Poor's ("S&P") 500 and S&P 500 Healthcare indices.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities At February 21, 2025, there were 46,585 shareholders of record. Solventum’s stock ticker symbol is SOLV and is listed on the New York Stock Exchange, Inc. (“NYSE”). No cash dividends were declared or paid since the company's inception on April 1, 2024.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities At February 18, 2026, there were 43,602 shareholders of record. Solventum’s stock ticker symbol is SOLV and is listed on the New York Stock Exchange. No cash dividends were declared or paid since the company's inception on April 1, 2024.
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Issuer Purchases of Equity Securities In November 2025, Solventum's Board of Directors approved a share repurchase program, which authorizes the Company to purchase up to $1 billion of the Company's outstanding common stock. Pursuant to the authorization, repurchases may be made from time to time in the open market, including through a Rule 10b5-1 or Rule 10b-18 trading plan.
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The share repurchase program has no time limit, does not require the Company to acquire any amount of shares, and may be suspended or discontinued at any time. There were no issuer purchases of equity securities under the share repurchase program for the three months ended December 31, 2025.

Item 7. Management's Discussion & Analysis

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

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Biggest changeRefer to Note 17 to the consolidated financial statements for additional information on business segments. 43 Table of Contents Segment and Total Company Net Sales Year ended December 31, (Dollars in millions) 2024 2023 Total Currency Impact Other Organic Segment Sales MedSurg $ 4,637 $ 4,632 0.1 % (0.6) % (0.5) % 1.2 % Dental Solutions 1,295 1,329 (2.6) (0.7) (1.5) (0.4) Health Information Systems 1,306 1,285 1.6 — — 1.6 Purification and Filtration 956 951 0.6 (0.7) (0.9) 2.1 Corporate and Unallocated 59 — NM NM NM NM Total Company $ 8,254 $ 8,197 0.7 % (0.5) % — % 1.2 % Year ended December 31, (Dollars in millions) 2023 2022 Total Currency Impact Other Organic Segment Sales MedSurg $ 4,632 $ 4,585 1.0 % (0.6) % — % 1.6 % Dental Solutions 1,329 1,327 0.2 (0.4) (1.0) 1.6 Health Information Systems 1,285 1,227 4.7 — — 4.7 Purification and Filtration 951 991 (4.0) (0.4) — (3.6) Corporate and Unallocated — — — — — — Total Company $ 8,197 $ 8,130 0.8 % (0.4) % (0.2) % 1.4 % Segment and Total Company Operating Income Year ended December 31, (Dollars in millions) 2024 2023 2024 vs 2023 change Segment Operating Income MedSurg $ 887 $ 1,107 (19.9) % Dental Solutions 350 442 (20.8) Health Information Systems 431 423 1.9 Purification and Filtration 94 162 (42.0) Corporate and Unallocated (726) (442) 64.3 Total Company $ 1,036 $ 1,692 (38.8) % Year ended December 31, (Dollars in millions) 2023 2022 2023 vs 2022 change Segment Operating Income MedSurg $ 1,107 $ 1,061 4.3 % Dental Solutions 442 437 1.1 Health Information Systems 423 359 17.8 Purification and Filtration 162 177 (8.5) Corporate and Unallocated (442) (341) 29.6 Total Company $ 1,692 $ 1,693 (0.1) % 44 Table of Contents Net Sales by Geographic Area While the Company manages its businesses globally and believes its business segment results are the most relevant measure of performance, the Company also utilizes geographic area data as a secondary performance measure.
Biggest changeSegment and Total Company Net Sales Year ended December 31, (Millions) 2025 2024 Reported Growth Currency Impact Constant Currency Other Organic Growth Segment Sales Advanced Wound Care $ 1,883 $ 1,835 2.6 % 0.5 % 2.1 % 0.1 % 2.0 % Infection Prevention and Surgical Solutions 2,934 2,802 4.7 0.5 4.2 (0.4) 4.5 MedSurg 4,817 4,637 3.9 0.6 3.3 (0.2) 3.5 Dental Solutions 1,349 1,295 4.2 1.1 3.1 (0.2) 3.3 Health Information Systems 1,360 1,306 4.1 0.2 3.9 — 4.0 Purification and Filtration 497 709 (29.9) 1.1 (31.0) (36.5) 5.5 All Other 302 306 (1.5) 0.3 (1.8) 4.3 (6.1) Total Company $ 8,325 $ 8,254 0.9 % 0.6 % 0.3 % (3.0) % 3.3 % Year ended December 31, (Millions) 2024 2023 Reported Growth Currency Impact Constant Currency Other Organic Growth Segment Sales Advanced Wound Care $ 1,835 $ 1,826 0.5 % (0.3) % 0.8 % (0.1) % 0.9 % Infection Prevention and Surgical Solutions 2,802 2,805 (0.1) (0.8) 0.7 (0.7) 1.4 MedSurg 4,637 4,632 0.1 (0.6) 0.7 (0.5) 1.2 Dental Solutions 1,295 1,329 (2.6) (0.7) (2.0) (1.5) (0.4) Health Information Systems 1,306 1,285 1.6 — 1.6 — 1.6 Purification and Filtration 709 689 3.0 (0.6) 3.7 (0.9) 4.6 All Other 306 262 16.7 (0.9) 17.6 18.8 (1.2) Total Company $ 8,254 $ 8,197 0.7 % (0.5) % 1.2 % — % 1.2 % 43 Table of Contents Segment and Total Company Operating Income Year ended December 31, (Millions) 2025 2024 2025 vs 2024 change Segment Operating Income MedSurg $ 810 $ 887 (8.6) % Dental Solutions 346 350 (1.1) Health Information Systems 496 431 15.0 Purification and Filtration 96 74 29.7 All Other 42 30 40.0 Corporate and Unallocated 390 (736) 153.0 Total Company $ 2,181 $ 1,036 110.5 % Year ended December 31, (Millions) 2024 2023 2024 vs 2023 change Segment Operating Income MedSurg $ 887 $ 1,107 (19.9) % Dental Solutions 350 442 (20.8) Health Information Systems 431 423 1.9 Purification and Filtration 74 111 (33.3) All Other 30 51 (41.2) Corporate and Unallocated (736) (442) 66.5 Total Company $ 1,036 $ 1,692 (38.8) % 44 Table of Contents Net Sales by Geographic Area While the Company manages its businesses globally and believes its business segment results are the most relevant measure of performance, the Company also utilizes geographic area data as a secondary performance measure.
Capital spending is discussed in more detail below in the section entitled “—Cash Flows from Investing Activities.” Critical Accounting Estimates Information regarding significant accounting policies is included in Note 1 of the accompanying consolidated financial statements. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make certain estimates and assumptions.
Capital spending is discussed in more detail below in the section entitled "—Cash Flows from Investing Activities." Critical Accounting Estimates Information regarding significant accounting policies is included in Note 1 of the accompanying consolidated financial statements. The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make certain estimates and assumptions.
Our actual results could differ materially from the results contemplated by these forward-looking statements due to a number of factors, including those discussed below and elsewhere in this Annual Report on Form 10-K, particularly in “Risk Factors.” See “ Cautionary Note Regarding Forward-Looking Statements. ” All amounts discussed are in millions of U.S. dollars, unless otherwise indicated.
Our actual results could differ materially from the results contemplated by these forward-looking statements due to a number of factors, including those discussed below and elsewhere in this Annual Report on Form 10-K, particularly in "Risk Factors." See "Cautionary Note Regarding Forward-Looking Statements." All amounts discussed are in millions of U.S. dollars, unless otherwise indicated.
Commercial Paper On March 4, 2024, the Company entered into a commercial paper program that allows it to issue up to $2.0 billion aggregate principal amount of short-term notes to finance short-term liabilities. Any such issuance will mature within 364 days from date of issue. There was no commercial paper outstanding as of December 31, 2024.
Commercial Paper On March 4, 2024, the Company entered into a commercial paper program that allows it to issue up to $2.0 billion aggregate principal amount of short-term notes to finance short-term liabilities. Any such issuance will mature within 364 days from date of issue. There was no commercial paper outstanding at December 31, 2025.
Material Cash Requirements from Known Contractual and Other Obligations: Solventum’s material cash requirements from known contractual and other obligations primarily relate to the following, for which information on both a short-term and long-term basis is provided in the indicated notes to the consolidated financial statements: • Tax obligations—Refer to Note 7 to the consolidated financial statements. • Debt—Refer to Note 8 to the consolidated financial statements. • Commitments and contingencies—Refer to Note 11 to the consolidated financial statements. • Operating leases—Refer to Note 12 to the consolidated financial statements.
Material Cash Requirements from Known Contractual and Other Obligations: Solventum’s material cash requirements from known contractual and other obligations primarily relate to the following, for which information on both a short-term and long-term basis is provided in the indicated notes to the consolidated financial statements: • Tax obligations—Refer to Note 8 to the consolidated financial statements. • Debt—Refer to Note 9 to the consolidated financial statements. • Commitments and contingencies—Refer to Note 12 to the consolidated financial statements. • Operating leases—Refer to Note 13 to the consolidated financial statements.
The above table includes the impact of acquisitions and other actions. Capital Spending and Property, Plant and Equipment - Net: Investments in property, plant and equipment enable growth across many diverse markets, helping to meet product demand and increasing manufacturing efficiency.
The above table includes the impact of acquisitions, divestitures, and other actions. 51 Table of Contents Capital Spending and Property, Plant and Equipment - Net: Investments in property, plant and equipment enable growth across many diverse markets, helping to meet product demand and increasing manufacturing efficiency.
The Company is increasing its investment in manufacturing and sourcing capability in order to more closely align its production capability with its sales in major geographic areas in order to best serve its customers 50 Table of Contents throughout the world with proprietary, automated, efficient, safe and sustainable processes.
The Company is increasing its investment in manufacturing and sourcing capability in order to more closely align its production capability with its sales in major geographic areas in order to best serve its customers throughout the world with proprietary, automated, efficient, safe and sustainable processes.
Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is designed to provide a reader of Solventum’s financial statements with a narrative from the perspective of management.
Management’s Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") is designed to provide a reader of Solventum’s financial statements with a narrative from the perspective of management.
Refer to Item 7A, “Quantitative and Qualitative Disclosures About Market Risk,” for further discussion of foreign exchange rates risk, and interest rates risk and commodity prices risk.
Refer to Item 7A, "Quantitative and Qualitative Disclosures About Market Risk," for further discussion of foreign exchange rates risk, and interest rates risk and commodity prices risk.
Other, as comprised in the tables below, includes acquisition and divestiture-related activities. Acquisitions include non-health care related supply agreements that conveyed from 3M to the Company at Spin-Off and sales from new supply agreements with 3M that commenced at Spin-Off.
Other, as comprised in the tables below, includes acquisition and divestiture-related activities. Acquisitions include sales from Acera that was acquired in December 2025, non-health care related supply agreements that conveyed from 3M to the Company at Spin-Off and sales from new supply agreements with 3M that commenced at Spin-Off.
The Company did not perform a discounted cash flow analysis for any reporting unit for any period presented, as the market approach analysis resulted in sufficient headroom between the fair value and the carrying value for each of the Company's reporting units. As of December 31, 2024, goodwill totaled approximately $6.4 billion.
The Company did not perform a discounted cash flow analysis for any reporting unit for any period presented, as the market approach analysis resulted in sufficient headroom between the fair value and the carrying value for each of the Company's reporting units. As of December 31, 2025, goodwill totaled approximately $5.7 billion.
Costs of Software and Rentals Costs of software and rentals includes compensation-related costs associated with installation, training and maintenance for our software products, and depreciation, maintenance and refurbishment costs and freight costs related to our hardware rental units. Costs of software and rentals, measured as a percent of sales of software and rentals, increased in 2024 as compared to 2023.
Costs of Software and Rentals Costs of software and rentals includes compensation-related costs associated with installation, training and maintenance for our software products, and depreciation, maintenance and refurbishment costs and logistics costs related to our hardware rental units. Costs of software and rentals, measured as a percent of sales of software and rentals, decreased in 2025 as compared to 2024.
The Company also had approximately $40 million in bank guarantees, surety bonds, and other similar instruments issued and outstanding at December 31, 2024. These instruments are utilized in connection with normal business activities. Refer to Note 8 of the Company's consolidated financial statements included elsewhere in this Annual Report on Form 10-K for more information.
Debt and Credit Facilities Refer to Note 9 of the Company's consolidated financial statements included elsewhere in this Annual Report on Form 10-K for more information. The Company had approximately $82 million in bank guarantees, surety bonds, and other similar instruments issued and outstanding at December 31, 2025. These instruments are utilized in connection with normal business activities.
Cash, cash equivalents and marketable securities As of December 31, 2024, Solventum had $762 million of cash and cash equivalents, of which approximately $611 million was held by the Company’s foreign subsidiaries and approximately $151 million was held in the United States. These balances are invested in bank instruments and other high-quality fixed income securities.
Cash, cash equivalents and marketable securities As of December 31, 2025, Solventum had $878 million of cash and cash equivalents, of which approximately $800 million was held by the Company’s foreign subsidiaries and approximately $78 million was held in the United States. These balances are invested in bank instruments and other high-quality fixed income securities.
The increase was driven by higher compensation, including equity-based awards, and higher costs associated with both initial stand-up and ongoing operations to support a standalone company. SG&A, measured as a percent of total net sales, decreased slightly in 2023 when compared to 2022.
The increase was driven by costs incurred to separate the Purification and Filtration business, higher compensation, including equity-based awards, and higher costs associated with both initial stand-up and ongoing operations to support a standalone company. SG&A, measured as a percent of total net sales, increased in 2024 when compared to 2023.
Please refer to the section entitled “Process for Disclosure and Recording of Liabilities Related to Legal Proceedings” (contained in “Legal Proceedings” in Note 11 to the accompanying consolidated financial statements) for additional information about such estimates. Goodwill The Company makes certain estimates and judgments in impairment assessments of goodwill.
Please refer to the section entitled "Process for Disclosure and Recording of Liabilities Related to Legal Proceedings" (contained in "Legal Proceedings" in Note 12 to the accompanying consolidated financial statements) for additional information about such estimates. Goodwill and Intangible Assets The Company makes certain estimates and judgments in impairment assessments of goodwill.
Cash flow activity with 3M is reflected in the due from and due to related parties. This activity includes settlement of payables and receivables transferred at Spin-Off related to operating transactions between 3M and Solventum entities that occurred prior to the Spin-Off and transactions under the transition agreements with 3M.
This activity includes settlement of payables and receivables transferred at Spin-Off related to operating transactions between 3M and Solventum entities that occurred prior to the Spin-Off and transactions under the transition agreements with 3M.
The proceeds from these financing transactions were transferred to 3M in connection with the Spin-Off transaction, other than the amounts retained in order to achieve the $600 million retained cash target. The Company repaid $300 million outstanding principle issued under the senior term loan credit facilities. Financing cash outflows increased in 2023 due to higher net transfers to 3M.
The proceeds from these financing transactions were transferred to 3M in connection with the Spin-Off transaction, other than the amounts retained in order to achieve the $600 million retained cash target. During 2024, the Company repaid $300 million outstanding principal issued under the senior term loan credit facilities.
See Note 1, “Significant Accounting Policies - Organization and Description of Business and Basis of Presentation ” to the consolidated financial statements and Part 1, Item 1A “Risk Factors” for additional information.
See Note 1, "Significant Accounting Policies - Organization and Description of Business and Basis of Presentation " to the consolidated financial statements and Part 1, Item 1A "Risk Factors" for additional information.
Goodwill is tested for impairment annually in the fourth quarter of each year, as further discussed below, and is tested between annual tests if an event occurs or circumstances change that would indicate the carrying amount may be impaired. Impairment testing for goodwill is done at a reporting unit level, with all goodwill assigned to a reporting unit.
Goodwill is tested for impairment annually in the fourth quarter of each year, as further discussed below, and is tested between annual tests if an event occurs or circumstances change that would indicate the carrying amount may be impaired.
Costs of Sales Year ended Year ended December 31, (Percent of corresponding net sales) 2024 2023 2022 2024 vs 2023 2023 vs 2022 Cost of product 50.0 % 48.0 % 46.9 % 2.0 % 1.1 % Cost of software and rentals 25.7 25.3 26.3 0.4 (1.0) Costs of Product Costs of product includes manufacturing, engineering and freight costs.
Costs of Sales Year ended Year ended December 31, (Percent of corresponding net sales) 2025 2024 2023 2025 vs 2024 2024 vs 2023 Cost of product 53.6 % 50.0 % 48.0 % 3.6 % 2.0 % Cost of software and rentals 23.9 25.7 25.3 (1.8) 0.4 Costs of Product Costs of product includes manufacturing, engineering and logistics costs.
Year ended December 31, 2024 United States International Worldwide Net sales (millions) $ 4,749 $ 3,505 $ 8,254 % of worldwide sales 57.5 % 42.5 % 100.0 % Increase/(decrease) Total 3.2 % (2.5) % 0.7 % Currency Impact — (1.2) (0.5) Other 1.5 (1.9) — Organic 1.7 % 0.6 % 1.2 % Year ended December 31, 2023 United States International Worldwide Net sales (millions) $ 4,603 $ 3,594 $ 8,197 % of worldwide sales 56.2 % 43.8 % 100.0 % Increase/(decrease) Total 3.4 % (2.3) % 0.8 % Currency Impact — (1.0) (0.4) Other — (0.4) (0.2) Organic 3.4 % (0.9) % 1.4 % Additional information beyond what is included in the preceding table is as follows: Year ended 2024 results • In the United States geographic area, both total sales and organic sales increased.
Year ended December 31, 2025 (Millions) United States International Worldwide Net sales $ 4,668 $ 3,657 $ 8,325 % of worldwide sales 56.1 % 43.9 % 100.0 % Increase/(decrease) Organic growth 3.7 % 2.7 % 3.3 % Other (1.3) (5.1) (3.0) Constant Currency 2.4 (2.4) 0.3 Currency Impact — 1.4 0.6 Reported Growth 2.4 % (1.0) % 0.9 % Year ended December 31, 2024 (Millions) United States International Worldwide Net sales $ 4,559 $ 3,695 $ 8,254 % of worldwide sales 55.2 % 44.8 % 100.0 % Increase/(decrease) Organic growth 1.2 % 1.4 % 1.2 % Other 0.8 (1.0) — Constant Currency 2.0 0.4 1.2 Currency Impact — (1.2) (0.5) Reported Growth 2.0 % (0.8) % 0.7 % Additional information beyond what is included in the preceding table is as follows: Year ended 2025 results • In the United States geographic area, both total sales and organic sales increased.
Geographic Area Supplemental Information Employees as of December 31, Capital Spending for the year ended December 31, Property, Plant and Equipment - net as of December 31, (Millions, except Employees) 2024 2023 2022 2024 2023 2022 2024 2023 2022 United States 10,919 10,906 9,850 $ 229 $ 160 $ 144 $ 893 $ 770 $ 718 International 11,062 11,101 10,248 151 130 107 729 687 601 Total Company 21,981 22,007 20,098 $ 380 $ 290 $ 251 $ 1,622 $ 1,457 $ 1,319 Employment: Employment decreased slightly in 2024 when compared to 2023 and increased in 2023 when compared to 2022.
Geographic Area Supplemental Information Employees as of December 31, Capital Spending for the year ended December 31, Property, Plant and Equipment - net as of December 31, (Millions, except Employees) 2025 2024 2023 2025 2024 2023 2025 2024 2023 United States 10,308 10,919 10,906 $ 200 $ 229 $ 160 $ 773 $ 893 $ 770 International 10,276 11,062 11,101 179 151 130 553 729 687 Total Company 20,584 21,981 22,007 $ 379 $ 380 $ 290 $ 1,326 $ 1,622 $ 1,457 Employment: Employment decreased in 2025 when compared to 2024 and decreased slightly in 2024 when compared to 2023.
Interest Expense, Net and Other Expense (Income), Net Year ended December 31, (Dollars in millions) 2024 2023 2022 Interest expense, net $ 367 $ — $ — Other expense (income), net $ 64 $ 25 $ 1 Interest expense, net includes interest accrued on debt obligations, offset by interest income from cash and marketable securities.
Interest Expense, Net, Loss on Debt Extinguishment, Net, and Other Expense (Income), Net Year ended December 31, (Millions) 2025 2024 2023 Interest expense, net $ 347 $ 367 $ — Loss on debt extinguishment, net 82 — — Other expense (income), net 39 64 25 Interest expense, net includes interest accrued on debt obligations, offset by interest income from cash and marketable securities.
Health Information Systems (15.8% of consolidated sales for year ended December 31, 2024) Year ended December 31, 2024 2023 2022 Net sales (millions) $ 1,306 $ 1,285 $ 1,227 Increase/(decrease) Organic 1.6 % 4.7 % 6.6 % Other — — — Currency Impact — — (0.8) Total 1.6 % 4.7 % 5.8 % Business segment operating income (millions) $ 431 $ 423 $ 359 Percent change 1.9 % 17.8 % 1.4 % Percent of sales 33.0 % 32.9 % 29.3 % Year 2024 results: Sales in Health Information Systems were up 1.6%: • Positive sales growth was driven by continued adoption of our 3M TM 360 Encompass TM . • Clinician productivity solutions declined primarily due to impacts from changing market conditions.
Health Information Systems (16.3% of consolidated sales for year ended December 31, 2025) Year ended December 31, (Millions) 2025 2024 2023 Net sales $ 1,360 $ 1,306 $ 1,285 Increase/(decrease) Organic growth 4.0 % 1.6 % Other — — Constant currency 3.9 1.6 Currency impact 0.2 — Reported growth 4.1 % 1.6 % Business segment operating income $ 496 $ 431 $ 423 Percent change 15.0 % 1.9 % Percent of sales 36.5 % 33.0 % 32.9 % Year 2025 results: Sales in Health Information Systems were up 4.1%: • Positive organic growth was driven by expanded adoption of our Solventum™ 360 Encompass TM and performance management solutions. • Clinician productivity solutions declined primarily due to impacts from changing market conditions. • Foreign currency translation positively impacted sales by 0.2%.
Results of Operations Net Sales Refer to the preceding “ —Overview ” section and the “ —Performance by Business Segment ” section later in MD&A for discussion of sales change.
Financial condition Refer to the section entitled "—Financial Condition and Liquidity" below for a discussion of items impacting cash flows. Results of Operations Net Sales Refer to the preceding "—Overview" section and the "—Performance by Business Segment" section later in MD&A for discussion of sales change.
The Company continues to prioritize investment initiatives. R&D, measured as a percent of total net sales, decreased slightly in 2023 when compared to 2022 as the Company prioritized investment initiatives.
R&D, measured as a percent of total net sales, increased slightly in 2024 when compared to 2023 due to initial stand-up costs. The Company continues to prioritize investment initiatives.
Operating Expenses Year ended December 31, (Percent of total net sales) 2024 2023 2022 2024 vs 2023 2023 vs 2022 Selling, general and administrative (SG&A) 33.7 % 27.4 % 27.5 % 6.3 % (0.1) % Research and development (R&D) 9.4 9.2 9.4 0.2 (0.2) Operating Income 12.6 20.6 20.8 (8.0) (0.2) Selling, General and Administrative SG&A, measured as a percent of total net sales, increased in 2024 when compared to 2023.
This increase was driven by higher compensation costs. 46 Table of Contents Operating Expenses Year ended December 31, (Percent of total net sales) 2025 2024 2023 2025 vs 2024 2024 vs 2023 Selling, general and administrative (SG&A) 37.0 % 33.7 % 28.0 % 3.3 % 5.7 % Research and development (R&D) 8.9 9.4 9.2 (0.5) 0.2 Gain on sale of business 18.6 — 0.7 18.6 (0.7) Operating Income 26.2 12.6 20.6 13.6 (8.0) Selling, General and Administrative SG&A, measured as a percent of total net sales, increased in 2025 when compared to 2024.
Financial Instruments The Company enters into foreign exchange forward contracts to hedge against the effect of exchange rate fluctuations on cash flows denominated in foreign currencies and to offset, in part, the impacts of changes in value of various non-functional currency denominated items including certain intercompany financing balances.
As of December 31, 2025, unconditional purchase obligations aggregated to approximately $330 million over the next five years, primarily comprised of IT-related obligations. 54 Table of Contents Financial Instruments The Company enters into foreign exchange forward contracts to hedge against the effect of exchange rate fluctuations on cash flows denominated in foreign currencies and to offset, in part, the impacts of changes in value of various non-functional currency denominated items including certain intercompany financing balances.
Business segment operating income margin decreased when compared to the same period last year. The decrease was driven by higher costs to stand-up and operate our standalone structure after Spin-Off. Year 2023 results: Sales in MedSurg were up 1.0%: • Organic sales growth of 1.6% was driven by price partially offset by lower volume.
Business segment operating income margin decreased when compared to the same period last year. The decrease was driven by higher costs to stand-up and operate our standalone structure after Spin-Off.
Interest expense, net increased in 2024 as compared to 2023 due to interest incurred on the February 2024 issuance of senior notes and March 2024 draw on the senior term loan credit facilities. Refer to Note 8 to the consolidated financial statements for more information.
Interest expense, net decreased in 2025 as compared to 2024 due to lower interest expense as a result of lower debt outstanding. Interest expense, net increased in 2024 as compared to 2023 due to interest incurred on the February 2024 issuance of senior notes and March 2024 draw on the senior term loan credit facilities.
Costs of product, measured as a percent of sales of product, increased in 2024 when compared to 2023. The increase was driven by increased costs due to the impact of higher costs on inventory sourced under the master supply and transition manufacturing agreements with 3M and due to the cost of other transition support provided by 3M.
The increase was driven by increased costs due to the impact of higher costs on inventory sourced under the master supply and transition manufacturing agreements with 3M and due to the cost of other transition support provided by 3M that have been incurred since Spin-Off.
Refer to the section entitled “ —Performance by Business Segment ” below for discussion of sales change and operating performance.
Refer to the section entitled "—Performance by Business Segment" below for discussion of sales change and operating performance. Refer to Note 18 to the consolidated financial statements for additional information on the Company's business segments.
Other expense (income), net increased in 2024 as compared to 2023 resulting from charges associated with the substantial liquidation of foreign operations completed as part of our separation from 3M in addition to foreign currency impacts and investment losses. Other expense (income), net increased in 2023 as compared to 2022 due to investment losses and higher foreign currency transaction losses.
Other expense (income), net includes the non-service component of periodic pension cost, investment gains and losses, and foreign currency transaction gain (loss). Other expense (income), net decreased in 2025 as compared to 2024 primarily due to charges associated with the substantial liquidation of foreign operations completed as part of our separation from 3M.
Dental Solutions (15.7% of consolidated sales for the year ended December 31, 2024) Year ended December 31, 2024 2023 2022 Net sales (millions) $ 1,295 $ 1,329 $ 1,327 Increase/(decrease) Organic (0.4) % 1.6 % (0.1) % Other (1.5) (1.0) — Currency Impact (0.7) (0.4) (4.8) Total (2.6) % 0.2 % (4.9) % Business segment operating income (millions) $ 350 $ 442 $ 437 Percent change (20.8) % 1.1 % (9.3) % Percent of sales 27.0 % 33.3 % 32.9 % Year 2024 results: Sales in Dental Solutions were down (2.6%): • Volume declines associated with softening end-market demand were partially offset by the favorable impact of prior year price actions. 48 Table of Contents • Other is primarily driven by lost sales from the Company’s dental anesthetics business that was sold in August 2023 as well as lost sales from certain health care businesses retained by 3M India in connection with the Spin-Off. • Foreign currency translation negatively impacted sales by (0.7%).
Dental Solutions (16.2% of consolidated sales for the year ended December 31, 2025) Year ended December 31, (Millions) 2025 2024 2023 Net sales $ 1,349 $ 1,295 $ 1,329 Increase/(decrease) Organic growth 3.3 % (0.4) % Other (0.2) (1.5) Constant currency 3.1 (2.0) Currency impact 1.1 (0.7) Reported growth 4.2 % (2.6) % Business segment operating income $ 346 $ 350 $ 442 Percent change (1.1) % (20.8) % Percent of sales 25.6 % 27.0 % 33.3 % Year 2025 results: Sales in Dental Solutions were up 4.2%: • Organic growth was primarily driven by new product volume growth in restorative and prevention solutions, partially offset by a decline in traditional orthodontic products. • Other is driven by lost sales from certain health care businesses retained by 3M India in connection with the Spin-Off. • Foreign currency translation positively impacted sales by 1.1%.
Organic growth was led by MedSurg and Health Information Systems. • In the International geographic area, total sales decreased while organic sales increased. Organic growth was led by Purification and Filtration.
Organic growth was led by MedSurg and Health Information Systems. Other is comprised of lost sales due to the divestiture of the Purification and Filtration business in September 2025. • In the International geographic area, total sales declined while organic sales increased. Organic growth was led by MedSurg and Dental Solutions.
The following discussion and analysis provides information management believes to be relevant to understanding the financial condition and results of operations of Solventum for the years ended December 31, 2024 and 2023. This discussion contains forward-looking statements that are based upon current expectations and are subject to uncertainty and changes in circumstances.
The following discussion and analysis provides information management believes to be relevant to understanding the financial condition and results of operations of Solventum for the years ended December 31, 2025 and 2024.
Individual amounts in the consolidated statements of cash flows exclude the effect of exchange rate impacts on cash and cash equivalents, which are presented separately in the cash flows. Thus, the amounts presented in the following operating, investing and financing activities tables reflect changes in balances from period to period adjusted for these effects.
Thus, the amounts presented in the following operating, investing and financing activities tables reflect changes in balances from period to period adjusted for these effects.
This growth was partially offset by our membranes OEM and drinking water filtration product categories. • Other includes lost sales from certain health care businesses retained by 3M India in connection with the Spin-Off. • Foreign currency translation negatively impacted sales by (0.7%).
This growth was partially offset by our membranes OEM. • Other includes lost sales from certain health care businesses retained by 3M India in connection with the Spin-Off. • Foreign currency translation negatively impacted sales by (0.6)%. Business segment operating income margin decreased primarily due to the negative impact from costs to stand-up and operate our standalone structure after Spin-Off.
Business segment operating income margin increased when compared to the same period last year driven by both price increases and lower spending, partially offset by wage inflation.
Business segment operating income margin increased when compared to the same period last year, driven by sales price growth, product mix and lower external license fees.
We constantly seek to enable the improvement of standards of care and move healthcare forward with innovation powered by insights, clinical intelligence, technology, and manufacturing expertise. Our 70+ year history of discovering and innovating advanced solutions has helped us solve our customers’ toughest challenges and become a trusted partner.
We constantly seek to enable the improvement of standards of care and move healthcare forward with innovation powered by insights, clinical intelligence, technology, and manufacturing expertise.
Operating Business Segments Information related to the Company’s segments is presented in the tables that follow with additional context in the corresponding narrative below the tables. 47 Table of Contents MedSurg (56.2% of consolidated sales for the year ended December 31, 2024 ) Year ended December 31, 2024 2023 2022 Net sales (millions) $ 4,637 $ 4,632 $ 4,585 Increase/(decrease) Organic 1.2 % 1.6 % 2.7 % Other (0.5) — — Currency Impact (0.6) (0.6) (3.7) Total 0.1 % 1.0 % (1.0 %) Business segment operating income (millions) $ 887 $ 1,107 $ 1,061 Percent change (19.9) % 4.3 % (13.5 %) Percent of sales 19.1 % 23.9 % 23.1 % Year 2024 results: Sales in MedSurg were up 0.1%: • Organic sales growth of 1.2% was driven by volumes, primarily due to benefits from medical OEM products, I.V. site management, and single-use negative pressure wound therapy, partially offset by declines in traditional negative pressure wound therapy and sterilization assurance products. • Other includes lost sales from certain health care businesses retained by 3M India in connection with the Spin-Off. • Foreign currency translation negatively impacted sales by (0.6%).
Year 2024 results: Sales in MedSurg were up 0.1%: • Organic sales growth of 1.2% was driven by volumes, primarily due to benefits from medical OEM products, I.V. site management, and single-use negative pressure wound therapy, partially offset by declines in traditional negative pressure wound therapy and sterilization assurance products. • Other includes lost sales from certain health care businesses retained by 3M India in connection with the Spin-Off. • Foreign currency translation negatively impacted sales by (0.6%).
Operating Segments and Sales Change Information Solventum manages its operations in four business segments: MedSurg, Dental Solutions, Health Information Systems, and Purification and Filtration. References are made to organic sales change, which is defined as the change in net sales, absent the separate impacts on sales from foreign currency translation and acquisitions, net of divestitures.
References are made to organic sales change, which is defined as the change in net sales, absent the separate impacts on sales from foreign currency translation and acquisitions, net of divestitures. Constant currency, as reflected in the tables below, is defined as the change in net sales absent the impact on sales from foreign currency translation.
Prior to Spin-Off, Corporate and Unallocated primarily included amortization of acquired intangible assets, restructuring and related charges, and benefits or costs related to capitalized manufacturing variances. Corporate and Unallocated also includes Spin-Off and separation related costs.
Corporate and Unallocated primarily includes amortization of acquired intangible assets, restructuring and related charges, timing related benefits or costs associated with capitalized manufacturing variances, charges and recoveries related to certain litigation, transaction and employee retention costs related to the acquisition of Acera, and gains on sale of businesses. In addition, Corporate and Unallocated includes Spin-Off and separation related costs.
New Accounting Pronouncements Information regarding new accounting pronouncements is included in Note 1 to the Company's consolidated financial statements included elsewhere in this Annual Report on Form 10-K. Financial Condition and Liquidity The strength and stability of Solventum’s operating model and strong free cash flow capability provides financial flexibility and enables the Company to invest through business cycles.
New Accounting Pronouncements Information regarding new accounting pronouncements is included in Note 1 to the Company's consolidated financial statements included elsewhere in this Annual Report on Form 10-K.
The increase is primarily driven by additional separation related capital spending as the Company relocates manufacturing and source of supply from 3M. In addition, the Company is focused on investments to support growth, renewal and maintenance programs, and environmental health services.
The company continues to focus capital spending on separation related activities as the Company relocates manufacturing and source of supply from 3M. Purchases of property, plant and equipment increased in 2024 as compared to 2023. The increase is primarily driven by additional separation related capital spending as the Company relocates manufacturing and source of supply from 3M.
Year ended 2023 results • In the United States geographic area, all business segments saw organic sales growth year on year, led by Health Information Systems and MedSurg. • In the International geographic area, total sales growth and organic sales growth decreased. Organic growth decline in Purification and Filtration was partially offset by organic growth in MedSurg and Dental Solutions.
Other is comprised of lost sales due to the divestiture of the Purification and Filtration business in September 2025. Year ended 2024 results • In the United States geographic area, both total sales and organic sales increased. Organic growth was led by MedSurg and Health Information Systems. • In the International geographic area, total sales decreased while organic sales increased.
The Company expects to receive underlying materials or services for these purchase obligations. To the extent the limited amount of these purchase obligations fluctuates, it largely trends with normal-course changes in regular operating activities. Additionally, contractual capital commitments represent a small part of the Company’s expected capital spending.
Additionally, the Company enters into contractual obligations for cloud storage solutions, enterprise resource planning and other IT-related services. The Company expects to receive underlying materials or services for these purchase obligations. To the extent these purchase obligations fluctuate, it largely trends with normal-course changes in regular operating activities.
Transition to Standalone Company Solventum utilized allocations and carve-out methodologies through the date of the Spin-Off to prepare combined financial statements.
Unless the context otherwise requires, references to "Solventum" and the "Company" refer to (i) 3M’s Health Care Business prior to the Spin-Off as a carve-out business of 3M and (ii) Solventum Corporation and its subsidiaries following the Spin-Off. Transition to Standalone Company Solventum utilized allocations and carve-out methodologies through the date of the Spin-Off to prepare combined financial statements.
Divestiture impacts include lost sales from the Company’s dental anesthetics business that was sold in August 2023 as well as lost sales from certain health care businesses retained by 3M India in connection with the Spin-Off. Solventum believes this information is useful to investors and management in understanding ongoing operations and in analysis of ongoing operating trends.
Divestiture impacts include lost sales from the Company’s Purification and Filtration business that was sold in September 2025, certain health care businesses retained by 3M India in connection with the Spin-Off, as well as impacts from other immaterial divested businesses.
The Company has four reporting units, with the MedSurg reporting unit accounting for approximately 56 percent of the goodwill. Based on the annual tests in the fourth quarter of 2024, 2023, and 2022, no goodwill impairment was indicated for any of the Company's reporting units.
The Company has four reporting units that are assigned goodwill, with the MedSurg reporting unit accounting for approximately 74 percent of the goodwill balance. In connection with our annual testing in the fourth quarter of 2025, no qualitative indicators of impairment were identified for any of the Company's reporting units.
Corporate and Unallocated also includes sales and cost of sales related to our supply agreements with 3M and other supply agreements assumed by the Company at Spin-Off related to legacy 3M businesses. Because Corporate and Unallocated includes a variety of miscellaneous items, it is subject to fluctuation on a quarterly and annual basis.
All Other also includes sales and cost of sales related to our agreements to supply 3M and other supply agreements assumed by the Company at Spin-Off related to legacy 3M businesses, which were historically included within Corporate and Unallocated. Corporate and Unallocated Certain items are maintained at the corporate level and not allocated to the segments ("Corporate and Unallocated").
Solventum estimates that year-on-year foreign currency transaction effects, including hedging impacts, decreased pre-tax income by approximately $23 million in 2024. 45 Table of Contents Financial condition Refer to the section entitled “ —Financial Condition and Liquidity ” below for a discussion of items impacting cash flows.
Refer to Note 11 to the consolidated financial statements for additional details. 45 Table of Contents Foreign currency had a positive worldwide impact on sales for the year ended December 31, 2025 compared to 2024. Solventum estimates that year-on-year foreign currency transaction effects, including hedging impacts, increased pre-tax income by approximately $6 million in 2025.
This increase was driven by higher compensation costs. Costs of software and rentals, measured as a percent of sales of software and rentals, decreased in 2023 as compared to 2022 due to product mix from higher software sales.
The decrease was due to the impact of lower external license fees, price and sales mix, primarily driven by higher sales of our revenue cycle management solution. Costs of software and rentals, measured as a percent of sales of software and rentals, increased in 2024 as compared to 2023.
Volume growth into higher margin products drove mix benefit. 49 Table of Contents Purification and Filtration (11.6% of consolidated sales for the year ended December 31, 2024) Year ended December 31, 2024 2023 2022 Net sales (millions) $ 956 $ 951 $ 991 Increase/(decrease) Organic 2.1 % (3.6) % 7.1 % Other (0.9) — — Currency Impact (0.7) (0.4) (6.3) Total 0.6 % (4.0) % 0.8 % Business segment operating income (millions) $ 94 $ 162 $ 177 Percent change (42.0) % (8.5) % (22.7) % Percent of sales 9.9 % 17.0 % 17.9 % Year 2024 results: Sales in Purification and Filtration were up 0.6%: • Primarily driven by higher volume growth in our bioprocessing filtration product category.
MedSurg (57.9% of consolidated sales for the year ended December 31, 2025 ) Year ended December 31, (Millions) 2025 2024 2023 Net sales $ 4,817 $ 4,637 $ 4,632 Increase/(decrease) Organic growth 3.5 % 1.2 % Other (0.2) (0.5) Constant currency 3.3 0.7 Currency impact 0.6 (0.6) Reported growth 3.9 % 0.1 % Business segment operating income (millions) $ 810 $ 887 $ 1,107 Percent change (8.6) % (19.9) % Percent of sales 16.8 % 19.1 % 23.9 % 48 Table of Contents Year 2025 results: Sales in MedSurg were up 3.9%: • Organic growth was driven by volumes in our Infection Prevention and Surgical Solutions business, led by I.V. site management.
The Company's reporting units correspond to a business segment as this represents the lowest level of discrete financial information below sales that is available and is regularly reviewed by segment management. An impairment loss would be recognized when the carrying amount of the reporting unit’s net assets exceeds the estimated fair value of the reporting unit.
Impairment testing for goodwill is done at a reporting unit level, with all goodwill assigned to a reporting unit. An impairment loss would be recognized when the carrying amount of the reporting unit’s net assets exceeds the estimated fair value of the reporting unit.
Starting in the second quarter of 2024, Solventum established its own hedging program. Refer to Note 10 to the consolidated financial statements for additional details. The stronger U.S. dollar had a negative worldwide impact on sales for the year ended December 31, 2024 compared to 2023.
The stronger U.S. dollar had a negative worldwide impact on sales for the year ended December 31, 2024 compared to 2023. Solventum estimates that year-on-year foreign currency transaction effects, including hedging impacts, decreased pre-tax income by approximately $23 million in 2024.
Costs of product, measured as a percent of sales of product, increased in 2023 when compared to 2022. Material and labor inflation, partially offset by benefits from both price and logistics costs, drove an increase of 0.7%.
Costs of product, measured as a percent of sales of product, increased in 2024 when compared to 2023.
Sales are generally reported within the geographic area that originated the invoice to the Company's customer. Additional geographic financial information related to the Company’s operations is provided in Note 17 in the accompanying consolidated financial statements. Percent change information compares year ended December 31, 2024 and December 31, 2023 with the same periods for the prior year, unless otherwise indicated.
Percent change information compares year ended December 31, 2025 and December 31, 2024 with the same periods for the prior year, unless otherwise indicated.
Performance by Business Segment Note 17 to the consolidated financial statements provides an overview of Solventum’s business segments in addition to disclosures relating to Solventum’s segments. We manage our operations in four business segments. The reportable segments are MedSurg, Dental Solutions, Health Information Systems, and Purification and Filtration.
Upon closing the sale of our Purification and Filtration business, we primarily manage our operations in three business segments: MedSurg, Dental Solutions, and Health Information Systems. Our Chief Operating Decision Maker evaluates segment operating performance using net sales and business segment operating income.
Cash Flows from Financing Activities: Year ended December 31, (Millions) 2024 2023 2022 Cash Flows from Financing Activities Repayment of debt $ (300) $ — — Net transfers to 3M (8,251) (1,553) (1,456) Proceeds from long-term debt, net of issuance costs 8,303 — Other — net 8 1 (4) Net cash provided by (used in) financing activities $ (240) $ (1,552) (1,460) Proceeds from long-term debt of $8.3 billion were related to the first quarter issuance of $6.9 billion in senior notes and $1.5 billion in senior term loan credit facilities.
In addition, the Company repaid the remaining $200 million aggregate principal amount outstanding under the eighteen month senior unsecured term loan credit facility. 2024 proceeds from long-term debt of $8.3 billion were related to the first quarter issuance of $6.9 billion in senior notes and $1.5 billion in senior term loan credit facilities.
Removed
Certain columns and rows within tables may not add up due to the use of rounded numbers. 42 Table of Contents Unless the context otherwise requires, references to “Solventum” and the “Company” refer to (i) 3M’s Health Care Business prior to the Spin-Off as a carve-out business of 3M and (ii) Solventum Corporation and its subsidiaries following the Spin-Off.
Added
Discussion, analysis and comparisons of the year ended December 31, 2023 that are not included in this Annual Report on Form 10-K can be found in "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Annual Report on Form 10-K for the year ended December 31, 2024 filed on February 28, 2025.
Removed
Sales and operating income by business segment: The following tables contain sales and operating results by business segment for all periods presented. The Company’s use of the term “NM” reflects results considered not material due to not having material activity in comparable prior years.
Added
This discussion contains forward-looking statements that are based upon current expectations and are subject to uncertainty and changes in circumstances.
Removed
Managing currency risks Prior to April 1, 2024, Solventum indirectly participated in 3M’s centrally managed hedging program, which utilizes a number of tools to manage currency risk including natural hedges such as pricing, productivity, hard currency, hard currency-indexed billings, and localizing source of supply. 3M also used financial hedges to mitigate currency risk.
Added
Amounts reported within this Annual Report are rounded to the nearest million and the sum of the components may not equal the total amount reported due to rounding. Additionally, certain columns and rows within tables may not sum due to rounding.
Removed
The material and labor inflation was primarily driven by a 1.4% impact from a higher cost of inventory produced in 2022 but sold in 2023.
Added
Our 70+ year history of discovering and innovating advanced solutions has helped us solve our customers’ toughest challenges and become a trusted partner. 41 Table of Contents Operating Segments and Sales Change Information Solventum manages its operations in three reportable business segments: MedSurg, Dental Solutions, and Health Information Systems.
Removed
This decrease was driven by the impact of the gain related to the sale of the Company’s dental local anesthetic business of 0.7%, partially offset by higher expense due to restructuring charges of 0.5%. 46 Table of Contents Research and Development R&D, measured as a percent of total net sales, increased slightly in 2024 when compared to 2023 due to initial stand-up costs.
Added
On February 25, 2025, the Company entered into a Transaction Agreement to sell its Purification and Filtration business to Thermo Fisher Scientific Inc. ("Buyer").
Removed
This increase was partially offset by interest earned from cash and marketable securities held during the period. There was no material activity in the years ended December 31, 2023 or 2022. Other expense (income), net includes the non-service component of periodic pension cost, investment gains and losses, and currency-related impacts from foreign currency translation.
Added
On June 25, 2025, the Company and Buyer entered into an Amended and Restated Transaction Agreement to exclude the Company’s drinking water filtration business (the "Water Business") from the scope of the Purification and Filtration business to be acquired by Buyer (such acquired business, the "Business").
Removed
Provision (benefit) for Income Taxes: Year ended December 31, (Percent of pre-tax income/loss) 2024 2023 2022 Effective tax rate 20.9 % 19.3 % 20.6 % Refer to Note 7 to the consolidated financial statements for further discussion of income taxes.
Added
On September 1, 2025, Solventum completed the sale of the Business to the Buyer in accordance with the terms of the Agreement. The cash consideration paid to Solventum at closing was approximately $4 billion. Refer to Note 3, "Acquisitions and Divestitures" for additional information.
Removed
Our Chief Operating Decision Maker evaluates segment operating performance using net sales and business segment operating income. Corporate and Unallocated Certain items are maintained at the corporate level and not allocated to the segments ("Corporate and Unallocated").
Added
Solventum believes this information is useful to investors and management in understanding ongoing operations and in analysis of ongoing operating trends. Healthcare Market Drivers Changing demographics An aging population, the prevalence and incidence rates of chronic conditions, and a rising middle class are driving the demand for improved access to quality care.
Removed
Volume declines from our microfluidics and hand hygiene product lines, which benefited from higher sales during the pandemic, negatively impacted growth by 1.1%. Business segment operating income margin increased when compared to the same period last year. The increase was driven by spending control and price partially offset by material inflation.
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Optimizing workflows to improve care quality and operational efficiency Of the $5.3 trillion in annual U.S. healthcare spending, an estimated 25% represents administrative costs that do not contribute to health outcomes and which we believe to be potentially wasteful based on overall spending data reported by the Centers for Medicare & Medicaid Services in the NHE Fact Sheet (available on CMS.gov as of January 14, 2026) and administrative spending estimates published in JAMA (Shrank et. al., Waste in the US Health Care System: Estimated Costs and Potential for Savings , published October 7, 2019).
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Year 2023 results: Sales in Dental Solutions were up 0.2%: • Positive volume and price growth of 3.5% from dental products were partially offset by declines in traditional orthodontic products. • Other was negatively impacted by 1.1% due to the exit of Health Care operations in Russia.

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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 changeThe Company enters into foreign exchange forward contracts to hedge against the effect of exchange rate fluctuations on cash flows denominated in foreign currencies. These transactions are designated as cash flow hedges. Solventum may de-designate these cash flow hedge relationships in advance of the occurrence of the forecasted transaction.
Biggest changeSolventum is also exposed to the translation of foreign currency earnings to the U.S. dollar. The Company enters into foreign exchange forward contracts to hedge against the effect of exchange rate fluctuations on cash flows denominated in foreign currencies. These transactions are designated as cash flow hedges.
Senior management also establishes certain associated procedures relative to control and valuation, risk analysis, counterparty credit approval, and ongoing monitoring and reporting. 52 Table of Contents To quantify Solventum’s primary market risk exposure, the Company performs a sensitivity analysis based on hypothetical changes in foreign currency spot exchange rates and interest rates as further described in the sections below.
Senior management also establishes certain associated procedures relative to control and valuation, risk analysis, counterparty credit approval, and ongoing monitoring and reporting. To quantify Solventum’s primary market risk exposure, the Company performs a sensitivity analysis based on hypothetical changes in foreign currency spot exchange rates and interest rates as further described in the sections below.
At December 31, 2024, an instantaneous 100 basis point change in applicable interest rates would increase/decrease the Company's pre-tax earnings by approximately $10 million on an annualized basis as it relates to the Company’s floating-rate notes and interest rate swap agreements.
At December 31, 2025, an instantaneous 100 basis point change in applicable interest rates would increase/decrease the Company's pre-tax earnings by approximately $7 million on an annualized basis as it relates to the Company’s floating-rate notes, interest rate swap agreements, and interest earned on cash.
In addition, Solventum enters into foreign currency contracts that are not designated in hedging relationships to offset, in part, the impacts of changes in value of various non-functional currency denominated items including certain intercompany financing balances.
Solventum may de-designate these cash flow hedge relationships in advance of the occurrence of the forecasted transaction. In addition, Solventum enters into foreign currency contracts that are not designated in hedging relationships to offset, in part, the impacts of changes in value of various non-functional currency denominated items including certain intercompany financing balances.
Note also that hypothetical changes in these rates were not applied to cash equivalents, accounts receivable, and accounts payable, because of the short-term nature of these instruments. Refer to Note 1. Significant Accounting Policies, Note 8. Long-Term Debt and Short-Term Borrowings and Note 10.
Note also that hypothetical changes in these rates were not applied to cash equivalents, accounts receivable, and accounts payable, because of the short-term nature of these instruments.
Solventum manages interest rate risk and expense using a mix of fixed and floating rate debt. In addition, the Company may enter into interest rate swaps that are designated and qualify as fair value hedges.
Interest Rates Risk: The Company may be impacted by interest rate volatility with respect to existing debt and future debt issuances, and cash. Solventum manages interest rate risk and expense using a mix of fixed and floating rate debt. In addition, the Company may enter into interest rate swaps that are designated and qualify as fair value hedges.
Derivatives within the notes to the consolidated financial statements of this Annual Report on Form 10-K for additional discussion of foreign currency exchange, interest rates and financial instruments.
Refer to Note 1, "Significant Accounting Policies", Note 9, "Long-Term Debt and Short-Term Borrowings" and Note 11, "Derivatives" within the notes to the consolidated financial statements of this Annual Report on Form 10-K for additional discussion of foreign currency exchange, interest rates and financial instruments.
Foreign Currency Exchange Rates Risk: Foreign currency exchange rates and fluctuations in those rates may affect the Company’s net investment in foreign subsidiaries and may cause fluctuations in cash flows related to foreign denominated transactions.
Foreign Currency Exchange Rates Risk: Foreign currency exchange rates and fluctuations in those rates may affect the Company’s net investment in foreign subsidiaries and may cause fluctuations in cash flows related to foreign denominated transactions. As circumstances warrant, the Company also uses cross-currency swap contracts as instruments to hedge portions of the Company’s net investments in foreign operations.
At December 31, 2024, an instantaneous 10% change in applicable foreign currency spot exchange rates would have increased/decreased the aggregate fair value carrying amount of foreign exchange forward and by approximately $45 million. Interest Rates Risk: The Company may be impacted by interest rate volatility with respect to existing debt and future debt issuances.
At December 31, 2025, an instantaneous 10% change in applicable foreign currency spot exchange rates would have increased/decreased the aggregate fair value carrying amount of foreign exchange forward and cross currency swaps by approximately $42 million and $135 million, respectively.
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As circumstances warrant, the Company also uses cross-currency swap contracts as instruments to hedge portions of the Company’s net investments in foreign operations.Solventum is also exposed to the translation of foreign currency earnings to the U.S. dollar.
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The Company's interest rate sensitivity analysis includes the impact of interest rate changes on its floating-rate notes, interest rate swap agreements, and cash balances.