10q10k10q10k.net

What changed in Viatris's 10-K — 2023 vs 2024

vs

Paragraph-level year-over-year comparison of Viatris's 2023 and 2024 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 2024 report.

+637 added−646 removedSource: 10-K (2025-02-27) vs 10-K (2024-02-28)

Top changes in Viatris's 2024 10-K

637 paragraphs added · 646 removed · 505 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

115 edited+50 added−52 removed41 unchanged
Biggest changeIn conjunction with these transactions, Viatris and the respective buyers have entered or will enter into various agreements to provide a framework for our relationship with the respective buyers after the closing of the divestitures, including TSAs, manufacturing and supply agreements, and distribution agreements, as necessary. 7 Table of Contents On February 28, 2024, the Company announced that it will acquire the development programs and certain personnel related to selatogrel and cenerimod from Idorsia in exchange for an upfront payment to Idorsia of $350 million, potential development and regulatory milestone payments, and certain contingent payments of additional sales milestone payments and tiered sales royalties.
Biggest changeUnder the terms of the original agreements, the development programs and certain personnel for selatogrel and cenerimod were transferred to Viatris from Idorsia in exchange for an upfront payment to Idorsia of $350 million, potential contingent milestone payments (including $300 million payable upon the achievement of certain development and regulatory milestones, and $2.1 billion payable upon the achievement of certain tiered sales milestones), as well as potential contingent tiered sales royalties.
We are convinced that patients and systems around the world are best served by a healthcare company applying a well-rounded and long-term approach, maintaining viability while working to manage inherent risks and opportunities and continuously striving to advance sustainable operations and responsible practices in a focused way. We see healthcare not as it is, but as it should be.
We are convinced that patients and health systems around the world are best served by a healthcare company applying a well-rounded and long-term approach, maintaining viability while working to manage inherent risks and opportunities and continuously striving to advance sustainable operations and responsible practices in a focused way. We see healthcare not as it is, but as it should be.
As the Company looks to the future, its goal is to leverage its proven scientific capabilities to create a durable and higher-margin portfolio of products. Viatris intends to continue building its pipeline and focusing on products with greater complexity while also investing in the lifecycle management of certain key products in our current portfolio.
As the Company looks to the future, Viatris’ goal is to leverage its proven scientific capabilities to create a durable and higher-margin portfolio of products. Viatris intends to continue building its pipeline and focusing on products with greater complexity while also investing in the lifecycle management of certain key products in our current portfolio.
The manufacturing of generic medicines is held to the same standards of GMP by health authorities as the manufacturing of branded medicines. National health authorities inspect our facilities around the world to ensure that generic manufacturing, packaging and testing sites pass the same quality standards as those of brand drugs. Gx products typically are sold under their INNs.
The manufacturing of generic medicines is held to the same standards of GMP by health authorities as the manufacturing of branded medicines. National health authorities inspect our facilities around the world to ensure that generic manufacturing, packaging and testing sites pass the same quality standards as those of brand drugs. Generic products typically are sold under their INNs.
Brand and branded generic products are more sensitive to promotion than are unbranded generic products. They therefore represent the primary focus of most of our sales representatives and product-level marketing activity. Our OTC products, which are sold directly to consumers without a prescription and without reimbursement, are generally sold under a brand name.
Brand and branded generic products are more sensitive to promotion than are unbranded generic products. They therefore represent the primary focus of most of our sales representatives and product-level marketing activity. Our remaining OTC products, which are sold directly to consumers without a prescription and without reimbursement, are generally sold under a brand name.
Our generic medicines work in the same way and provide the same clinical benefits as their as their brand-name counterparts and may cost less, providing patients and the healthcare system important savings and medicine options which we believe are essential to making healthcare accessible.
Our generic medicines work in the same way and provide the same clinical benefits as their as their brand-name counterparts and may cost less, providing patients and the healthcare system important savings and options which we believe are essential to making healthcare accessible.
The Company’s significant manufacturing, warehousing and distribution activities are located primarily in the U.S., Puerto Rico, Singapore, India, Australia, China, and certain E.U. countries, including Ireland. In addition, we maintain administrative facilities around the world. While many of these key facilities are owned, Viatris also leases certain facilities from third parties.
The Company’s significant manufacturing, warehousing and distribution activities are located primarily in the U.S., Puerto Rico, Singapore, India, Australia, China, and certain EU countries, including Ireland. In addition, we maintain administrative facilities around the world. While many of these key facilities are owned, Viatris also leases certain facilities from third parties.
For additional information, see Part I, Item 1A “Risk Factors - We have and may continue to experience pressure on the pricing of and reimbursements for certain of our products due to pricing controls, social or government pressure to lower the cost of drugs, and consolidation across the supply chain. ” of this Form 10-K.
For additional information, see Part I, Item 1A Risk Factors - “ We have and may continue to experience pressure on the pricing of and reimbursements for certain of our products due to pricing controls, social or government pressure to lower the cost of drugs, and consolidation across the supply chain. ” of this Form 10-K.
Viatris offers a number of these important medicines to patients, including Breyna™ Inhalation Aerosol, the first FDA-approved generic version of Symbicort®, Wixela Inhub®, the first generic of ADVAIR DISKUS® and glatiramer acetate injection, a generic version of Copaxone®, for example. Our current complex products are considered generics and are included within our generics revenue category.
Viatris offers a number of these important medicines to patients, including Breyna™ Inhalation Aerosol, the first FDA-approved generic version of Symbicort®, Wixela Inhub®, the first generic of ADVAIR DISKUS® and glatiramer acetate injection, a generic version of Copaxone®. Our current complex products are considered generics and are included within our generics revenue category.
For additional information, see Part I, Item 1A “Risk Factors - We have a limited number of manufacturing facilities and certain third-party suppliers produce a substantial portion of our API and products, some of which require a highly exacting and complex manufacturing process. ” of this Form 10-K.
For additional information, see Part I, Item 1A Risk Factors - “ We have a limited number of manufacturing facilities and certain third-party suppliers produce a substantial portion of our API and products, some of which require a highly exacting and complex manufacturing process. ” of this Form 10-K.
In addition, authorities often conduct pre-approval plant inspections to determine whether our systems and processes comply with current GMP and other regulations, and clinical-trial reviews to evaluate regulatory compliance and data integrity. Our suppliers, contract manufacturers, clinical trial partners and other business partners are subject to similar regulations and periodic inspections.
In addition, authorities often conduct pre-approval plant inspections to determine whether the Company’s systems and processes comply with current GMP and other regulations, and clinical-trial reviews to evaluate regulatory compliance and data integrity. Our suppliers, contract manufacturers, clinical trial partners and other business partners are subject to similar regulations and periodic inspections.
INNs facilitate the identification of pharmaceutical substances or APIs. Each INN is unique and globally recognized. A nonproprietary name also is known as a generic name. Complex drugs are medicines that could have a complex active ingredient, complex formulation, complex route of delivery or complex drug device combinations.
INNs facilitate the identification of pharmaceutical substances or API. Each INN is unique and globally recognized. A nonproprietary name also is known as a generic name. Complex drugs are medicines that could have a complex active ingredient, complex formulation, complex route of delivery or complex drug device combinations.
In substitution markets, pharmacists generally are authorized (and in some cases required) by law to dispense an unbranded or branded generic, if available, in place of a brand-name medicine, or vice versa. Drug companies may use sales 14 Table of Contents forces in these markets too, with representatives calling on and educating pharmacy personnel about their organization and products.
In substitution markets, pharmacists generally are authorized (and in some cases required) by law to dispense an unbranded or branded generic, if available, in place of a brand-name medicine, or vice versa. Drug companies may use sales forces in these markets too, with representatives calling on and educating pharmacy personnel about their organization and products.
Together with a global, flexible and diverse supply chain, our platform strives to mitigate risks of disruption and ensure supply reliability. Our responsive global network has helped us maintain a reliable supply of much needed medicines throughout times of significant volatility.
Together with a global, flexible and diverse supply chain, our platform strives to mitigate risks of disruption and ensure supply reliability. Our responsive global network has helped us maintain a reliable supply of much needed medicines through times of significant volatility.
Our research, development and clinical platform, which includes regulatory activities, seeks to deliver new product opportunities across all of our categories and markets and to evaluate opportunities to expand the scope of our existing product portfolio with a focus on development activities.
Viatris’ research, development and clinical platform, which includes regulatory activities, seeks to deliver new product opportunities across all of the Company’s categories and markets and to evaluate opportunities to expand the scope of our existing product portfolio with a focus on development activities.
Note, however, that pharmacists operating in distribution markets also may be authorized to make substitution decisions when dispensing medicines. Examples of countries served by Viatris that are mainly distribution markets are the U.S. generics business, the U.K. and Norway. The allocation of our sales and marketing resources reflects the characteristics of these different market types.
Note, however, that pharmacists operating in distribution markets 14 Table of Contents also may be authorized to make substitution decisions when dispensing medicines. Examples of countries served by Viatris that are mainly distribution markets are the U.S. generics business, the U.K. and Norway. The allocation of our sales and marketing resources reflects the characteristics of these different market types.
Many countries in this segment are brand-conscious with generic penetration rates lower than developed markets. Among our products sold in the segment are Lipitor®, Lyrica®, Norvasc®, Celebrex®, and ARVs. Refer to Note 15 Segment Information included in Part II, Item 8 of this Form 10-K for more information about our segments.
Many countries in this segment are brand-conscious with generic penetration rates lower than developed markets. Among Viatris products sold in the segment are Lipitor®, Lyrica®, Norvasc®, Celebrex®, and ARVs. Refer to Note 15 Segment Information included in Part II, Item 8 of this Form 10-K for more information about the Company’s segments.
Together, with our commitment to provide access to a sustainable, affordable, and diverse portfolio of high-quality medicines and our goal to be a Partner of Choice® for companies big and small, Viatris works to improve access and meet evolving healthcare needs around the world. PARTNERSHIP Leveraging our collective expertise to connect people to products and services.
Together, with our commitment to provide access to a sustainable, affordable, and diverse portfolio of high-quality medicines and our goal to be a Partner of Choice® for companies big and small, Viatris works to improve access and meet evolving healthcare needs around the world. 10 Table of Contents PARTNERSHIP Leveraging our collective expertise to connect people to products and services.
While many important strides have been made to treat these illnesses, there is still more to be done in countries where lack of access to therapeutics, preventative treatment and diagnostics often result in patients not receiving proper care, and those where HIV transmission continues thirty years into the epidemic.
While many important strides have been made to treat these illnesses, there is still more to be done in countries where lack of access to therapeutics, preventative treatment and diagnostics often result in patients not receiving proper care, and those where HIV transmission continues decades into the epidemic.
Brand drugs include branded generics which are off-patent products that are sold under an approved proprietary name for marketing purposes. Brand products often become branded generics once patent protections or other forms of exclusivity expire. Branded generic products are common in many countries outside the U.S., including emerging markets.
Brand drugs include branded generics which are off-patent products that are 13 Table of Contents sold under an approved proprietary name for marketing purposes. Brand products often become branded generics once patent protections or other forms of exclusivity expire. Branded generic products are common in many countries outside the U.S., including emerging markets.
While committed to generics and specialty products, over the last several years, a greater portion of our investments has been focused on complex or difficult-to-formulate products, such as modified release injectables, rather than on commodity products, such as conventional oral solid dosage forms.
While committed to generics and specialty products, over the last several years, a greater portion of the Company’s investments has been focused on complex or difficult-to-formulate products, such as modified release or complex injectables such as glucagon, rather than on commodity products, such as conventional oral solid dosage forms.
Government Regulation Regulation by governmental authorities is a significant factor in the R&D, manufacture, marketing, sales and distribution of pharmaceuticals. Our products are subject to robust developmental studies which include analytical determinations of strength, quality, purity as well as rigorous safety and efficacy determinations using preclinical, pharmacokinetic studies and clinical evaluations to gather data to support regulatory review and approval.
Government Regulation Regulation by governmental authorities is a significant factor in the R&D, production, marketing, sales and distribution of pharmaceuticals. Viatris’ products are subject to robust developmental studies which include analytical determinations of strength, quality, purity as well as rigorous safety and efficacy determinations using preclinical, pharmacokinetic studies and clinical evaluations to gather data to support regulatory review and approval.
As a company, Viatris: 9 Table of Contents • Covers a broad range of therapeutic areas . We produce medicines for patients across a broad range of major therapeutic areas. From cardiovascular health to oncology, Viatris offers quality treatment options across more than 10 major therapeutic areas covering a wide variety of noncommunicable and infectious diseases.
As a company, Viatris: • Covers a broad range of therapeutic areas . We produce medicines for patients across a broad range of major therapeutic areas. From cardiovascular health to oncology, Viatris offers quality treatment options across more than 10 major therapeutic areas covering a wide variety of noncommunicable and infectious diseases.
Drug companies employ sales forces to educate doctors about the clinical benefits of their products. Representatives call on individual doctors or group practices; the process is known as detailing. Examples of countries served by Viatris that are mainly prescription markets are the U.S. brand business, China, Turkey, Poland and Mexico.
Pharmacies then dispense the products as directed. Drug companies employ sales forces to educate doctors about the clinical benefits of their products. Representatives call on individual doctors or group practices; the process is known as detailing. Examples of countries served by Viatris that are mainly prescription markets are the U.S. brand business, China, Turkey, Poland and Mexico.
Our leadership position in a number of countries provides us a platform to fulfill the needs of patients, physicians, pharmacies, customers and payors. Significant products sold by the Developed Markets segment include Lyrica®, Lipitor®, Creon®, Influvac®, Wixela Inhub®, EpiPen® Auto-Injector, Fraxiparine®, and Yupelri®. New product launches are an important growth driver.
Viatris’ leadership position in a number of countries provides the Company a platform to fulfill the needs of patients, physicians, pharmacies, customers and payors. Significant products sold by the Developed Markets segment include Lyrica®, Lipitor®, Creon®, Influvac®, Wixela Inhub®, EpiPen® Auto-Injector, Fraxiparine®, and Yupelri®. New product launches are an important growth driver.
The Upjohn Business was a global, primarily off-patent branded and generic established medicines business, which included 20 primarily off-patent oral solid dose legacy brands, such as Lyrica®, Lipitor®, Celebrex® and Viagra®. 8 Table of Contents Mylan was founded in 1961 as a privately-owned company and grew over time into one of the largest manufacturers of generic drugs in the U.S.
The Upjohn Business was a global, primarily off-patent branded and generic established medicines business, which included 20 primarily off-patent oral solid dose legacy brands, such as Lyrica®, Lipitor®, Celebrex® and Viagra®. Mylan was founded in 1961 as a privately-owned company and grew over time into one of the largest manufacturers of generic medicines in the U.S.
We have a strong history of partnering with other pharmaceutical companies, nonprofit organizations, government agencies, policymakers, trade associations and alliances, industry researchers and patient advocacy groups to promote sustainable access to treatment, build more resilient healthcare systems and drive these issues within our industry on global, regional and local levels.
We have a strong history of playing a leading role by partnering with other pharmaceutical companies, nonprofit organizations, government agencies, policymakers, trade associations and alliances, industry researchers and patient advocacy groups to promote sustainable access to treatment, build more resilient healthcare systems and drive these issues within our industry on global, regional and local levels.
Healthcare consumerism, increased spending power, and demand for premium medical products have generated strong growth in these new channels and partially absorbed the reductions seen in hospital channel due to VBP. Additional pricing and volume pressure for pharmaceutical products sold in the hospital channels is expected to continue during 2024 and could negatively impact our results of operations.
Healthcare consumerism, increased spending power, and demand for premium medical products have generated strong growth in these new channels and partially absorbed the reductions seen in the hospital channel due to VBP. Additional pricing and volume pressure for pharmaceutical products sold in the hospital channel is expected to continue during 2025 and could negatively impact the Company’s results of operations.
Any failure or delay by us, our suppliers of manufactured drug product, collaborators or licensees, in obtaining and maintaining regulatory approvals could adversely affect the marketing of our products and our ability to receive product revenue, license revenue or profit-sharing payments.
Any failure or delay by Viatris, its suppliers of manufactured drug product, collaborators or licensees, in obtaining and maintaining regulatory approvals could adversely affect the marketing of our products and our ability to receive product revenue, license revenue or profit-sharing payments.
We act courageously and believe we are uniquely positioned to be a source of stability in a world of evolving healthcare needs. Viatris empowers people worldwide to live healthier at every stage of life. We do so via Access , Leadership and Partnership . ACCESS Viatris provides high-quality, trusted medicines, regardless of geography or circumstance.
We act courageously and believe we are uniquely positioned to be a source of stability in a world of evolving healthcare needs. Our mission is to empower people worldwide to live healthier at every stage of life. We do so via Access , Leadership and Partnership . ACCESS Viatris provides high-quality, trusted medicines, regardless of geography or circumstance.
Post-approval activities, such as advertising and promotion, pharmacovigilance, post-marketing regulatory commitments, and pharmacopeial monographs, are subject to extensive regulation and controls as well. The lengthy process of developing products and obtaining required approvals and the continuing need for post-approval compliance with applicable statutes and regulations require the expenditure of substantial resources.
Post-approval activities, such as advertising and promotion, pharmacovigilance, post-marketing regulatory commitments, and pharmacopeial monographs, are also subject to extensive regulation and controls. 16 Table of Contents The lengthy process of developing products and obtaining required approvals and the continuing need for post-approval compliance with applicable statutes and regulations require the expenditure of substantial resources.
Partnerships and collaborations are critical, as are policies and strong healthcare systems that allow for healthy competitive environments. The need is universal, and we work with an array of organizations, globally, regionally, locally, public and private to support sustainable access to quality medicines at consistent quality standards.
Partnerships and collaborations are critical, as are policies and strong healthcare systems that allow for healthy competitive environments. The need is universal, and Viatris works with an array of both public and private organizations, globally, regionally, and locally, to support sustainable access to quality medicines at consistent quality standards.
Decision-makers vary by country or region, reflecting law and custom, giving rise to different types of pharmaceutical markets. Many countries feature a mix of or hybrids of various market types, though the Company may focus on just one type in a particular country. In prescription markets, physicians decide which medicines patients will take. Pharmacies then dispense the products as directed.
Decision makers vary by country or region, reflecting law and custom, giving rise to different types of pharmaceutical markets. Many countries feature a mix of or hybrids of various market types, though the Company may focus on just one type in a particular country. In prescription markets, physicians decide which medicines patients will take.
Other Regulatory Requirements Our business is subject to a wide range of various other federal, state, non-governmental, and local agency rules and regulations. They focus on fraud and corruption, pricing and reimbursement, data privacy, and the environment, among many other considerations.
Other Regulatory Requirements Viatris’ business is subject to a wide range of various other federal, state, national, regional, provincial, non-governmental, and local agency rules and regulations. They focus on fraud and corruption, pricing and reimbursement, data privacy, and the environment, among many other considerations.
For additional information, see Part I, Item 1A “Risk Factors - We rely on the effectiveness of our patents, trademarks, confidentiality agreements and other measures to protect our intellectual property rights. ” of this Form 10-K.
For additional information, see Part I, Item 1A Risk Factors - “ We 17 Table of Contents rely on the effectiveness of our patents, trademarks, confidentiality agreements and other measures to protect our intellectual property rights. ” of this Form 10-K.
We also use our platform to determine whether there is an opportunity to integrate new products into our portfolio. The manufacturing of APIs and finished dosage forms is currently performed by a combination of internal and external manufacturing operations.
We also use our platform to determine whether there is an opportunity to integrate new products into our portfolio. 11 Table of Contents The manufacturing of API and finished dosage forms is currently performed by a combination of internal and external manufacturing operations.
Our business and operating model is deliberately designed and implemented to deliver on our strategy to provide and sustain access to medicine at scale.
Our strength is in our diversity. Our business and operating model is deliberately designed and implemented to deliver on our strategy to provide and sustain access to medicine at scale.
Licensing and Other Partner Agreements We periodically enter into commercial licensing and other partner agreements with other pharmaceutical companies for the development, manufacture, marketing and/or sale of pharmaceutical products. Doing so helps us share risks and costs, leverage strengths and scale up commercialization, but usually requires us to also share future profits.
Licensing and Other Partner Agreements Viatris periodically enters into commercial licensing and other partner agreements with other pharmaceutical companies for the development, manufacture, marketing and/or sale of pharmaceutical products. Doing so helps the Company share risks and costs, leverage strengths and scale up commercialization, but usually requires the Company to also share future profits.
In the case of OTC products, consumers are the decision-makers. OTC products are commonly sold via retail channels, such as pharmacies, drugstores and supermarkets. This makes their sale and marketing comparable to other retail businesses, with broad advertising and trade-channel promotion. Consumers often are loyal to well-known OTC brands.
For our remaining OTC products, consumers are the decision-makers. OTC products are commonly sold via retail channels, such as pharmacies, drugstores and supermarkets. This makes their sale and marketing comparable to other retail businesses, with broad advertising and trade-channel promotion. Consumers often are loyal to well-known OTC brands.
The result often is that medicines become available sooner and to a significantly larger group of patients. Our significant licensing and other partner agreements are primarily focused on the development, manufacturing, supply and commercialization of multiple, high-value generic compounds and respiratory products, among other complex products.
The result often is that medicines become available sooner and to a significantly larger group of patients. The Company’s significant licensing and other partner agreements are focused on the development, manufacturing, supply and commercialization of multiple, high-value generic compounds, respiratory products, and other complex or innovative products.
While we will continue to diligently pursue important generics opportunities, we will increasingly focus on limited-competition complex and novel products targeting gaps in care, all with a first-to-market emphasis and serving our mission of patient access. Complex product categories are critical to patient health and are growing at a rapid pace.
While Viatris will continue to diligently pursue important generics opportunities, the Company will increasingly focus on limited-competition complex and novel products targeting gaps in care, all with a first-to-market emphasis and serving our mission of patient access. The Company believes innovative and complex products categories are critical to patient health and are growing at a rapid pace.
Our product pipeline includes a variety of dosage forms, including oral solid dosage forms, transdermals, injectables, inhalation, and other delivery systems.
The Company’s product pipeline includes a variety of dosage forms, including oral solid dosage forms, transdermals, injectables, inhalation, and other delivery systems.
With the global platforms and infrastructure supporting our innovative Global Healthcare Gateway®, we are enhancing our capital allocation approach to business development, and our organic and inorganic R&D investments through a focused governance structure to ensure the highest level of strategic decision-making.
With the global platforms and infrastructure supporting its innovative Global Healthcare Gateway®, the Company is enhancing its capital allocation approach to business development, and its organic and inorganic R&D investments through a focused governance structure to ensure the highest level of strategic decision-making.
Community Engagement We seek to foster healthy communities around the world by supporting education, health and disease awareness efforts that, in particular, promote empowering patients and creating access to care. We work via in-kind and monetary donations, volunteering our time and talents and engaging with partners to find solutions.
Community Engagement Viatris seeks to foster healthy communities around the world by supporting education, health and disease awareness efforts that, in particular, promote empowering patients and creating access to care. The Company works via in-kind and monetary donations, volunteering time and talents and engaging with partners to find solutions.
During the periods protected, developers often recoup their investments and earn a profit. In many high-income countries, the brand business often is characterized by higher margins on lower volumes - especially as compared with generic manufacturers. Viatris has numerous branded drugs, including iconic brands, as well as several global key brands to help patients manage their health.
In many high-income countries, the brand business often is characterized by higher margins on lower volumes - especially as compared with generic manufacturers. Viatris has numerous branded drugs, including iconic brands, as well as several global key brands to help patients manage their health.
With the needs of people at the center, we often work to help find solutions that support resilient healthcare systems. We have designed our global operations and supply chain to be a reliable and flexible partner for access across the world, constantly adapting to an ever-evolving landscape. We pursue holistic approaches to prevention, diagnosis, treatment, and disease management.
With the needs of people at the center, Viatris often works to help find solutions that support resilient healthcare systems. The Company has designed its global operations and supply chain to be a reliable and flexible partner for access across the world, constantly adapting to an ever-evolving landscape. Viatris pursues holistic approaches to prevention, diagnosis, treatment, and disease management.
Important recent launches include lenalidomide and Breyna™ in the U.S. While our U.S. customer base is extensive, it comprises a small number of very large firms as the pharmaceutical industry has undergone tremendous change and consolidation.
Important recent launches include Breyna™ and lisdexamfetamine in the U.S., and Rivaroxaban in certain European markets. While Viatris’ U.S. customer base is extensive, it comprises a small number of very large firms as the pharmaceutical industry has undergone tremendous change and consolidation.
For more information about certain of these regulations and the associated risks we face, see Part I, Item 1A “Risk Factors” of this Form 10-K. Research and Development Our R&D organization, which includes developers and regulatory and clinical experts, works collaboratively across our different R&D centers around the world, which include technology-focused development sites and global R&D centers.
For more information about certain of these regulations and the associated risks the Company faces, see Part I, Item 1A Risk Factors of this Form 10-K. Research and Development Viatris’ R&D organization, which includes developers and regulatory and clinical experts, works collaboratively across the Company’s different R&D centers around the world, which include technology-focused development sites and global R&D centers.
Underpinned by Viatris’ relevance and success in meeting evolving healthcare needs, we seek to create value for and together with our key stakeholders – the people who trust our medicines every day, the health systems who rely on us, the people who make up Viatris, our partners and the investors who believe in our ability to execute on our ambitious mission.
We seek to create value for and together with our key stakeholders – the people who trust our medicines every day, the health systems who rely on us, the people who make up Viatris, our partners and the investors who believe in our ability to execute on our ambitious mission.
We work to build public health awareness, to support and implement research, to deliver access to health education, and to advocate for public policies that advance sustainable access at scale, globally. We are keenly aware that no one can meet this high aspiration alone.
The Company works to build public health awareness, to support and implement research, to deliver access to health education, and to advocate for public policies that advance sustainable access at scale, globally. Viatris is keenly aware that no one can meet this high aspiration alone.
We have an extensive trademark portfolio totaling more than 34,000 trademarks filed globally and routinely apply to register key brand names, generic names, branded generic names, and trade names in numerous countries around the world. Our registered trademarks are renewable indefinitely, and are maintained in accordance with the laws of the countries in which they are registered.
Viatris has an extensive trademark portfolio totaling more than 28,700 trademarks filed globally and routinely apply to register key brand names, generic names, branded generic names, and trade names in numerous countries around the world. The Company’s registered trademarks are renewable indefinitely, and are maintained in accordance with the laws of the countries in which they are registered.
Further, we have well-established safeguards in place to protect our proprietary know-how and trade secrets, both of which we consider extremely valuable to our intellectual property portfolio. We look for intellectual property licensing opportunities to or from third parties, related not only to our existing products, but as a means for expanding our product portfolio.
Further, Viatris has well-established safeguards in place to protect our proprietary know-how and trade secrets, both of which the Company considers extremely valuable to its intellectual property portfolio. The Company looks for intellectual property licensing opportunities to or from third parties, related not only to our existing products, but as a means for expanding our product portfolio.
We are actively engaging with potential partners to help them accelerate possibilities of using their own healthcare assets to reach more patients by leveraging our unique global platform – our R&D, supply chain, manufacturing, regulatory, commercial and legal expertise.
The Company is actively engaging with potential business partners to help them accelerate possibilities of using their own healthcare assets to reach more markets and patients by leveraging Viatris’ unique global platform – its R&D, supply chain, manufacturing, regulatory, commercial and legal expertise.
We have designed our global operations and supply chain to be a reliable and flexible partner for access across the world, constantly adapting to an ever-evolving landscape. As of December 31, 2023, Viatris operated approximately 40 manufacturing sites worldwide that produce oral solid doses, injectables, complex dosage forms and APIs on five different continents.
We have designed our global operations and supply chain to be a reliable and flexible partner for access across the world, constantly adapting to an ever-evolving landscape. Viatris operates approximately 26 manufacturing and packaging sites worldwide that produce oral solid doses, injectables, and products with complex dosage forms on five different continents.
Our Emerging Markets segment encompasses our presence in more than 125 countries with developing markets and emerging economies including in Asia, Africa, Eastern Europe, Latin America and the Middle East as well as the Company’s ARV franchise. 15 Table of Contents Developed Markets The Developed Markets segment comprises our operations primarily in North America and Europe.
Emerging Markets The Emerging Markets segment encompasses our presence in more than 125 countries with developing markets and emerging economies including in Asia, Africa, Eastern Europe, Latin America and the Middle East as well as the Company’s ARV franchise.
On October 1, 2023, the Company announced it received an offer for the divestiture of its OTC Business, and entered into definitive agreements to divest its women’s healthcare business and, separately, in another transaction, its rights to two women’s healthcare products in certain countries, its API business in India and commercialization rights in the Upjohn Distributor Markets.
In October 2023, the Company announced it had received an offer for the divestiture of its OTC Business and had entered into definitive agreements to divest its women’s healthcare business primarily related to oral and injectable contraceptives, its API business in India, its rights to two women’s healthcare products in certain countries, and commercialization rights in the Upjohn Distributor Markets.
These acquisitions assisted in creating robust research, manufacturing, supply chain and commercial platforms on a global scale; substantially expanding its portfolio of medicines; diversifying by geography, product type and channel; maintaining its commitment to quality; and cultivating its global workforce.
These acquisitions assisted in creating robust research, manufacturing, supply chain and commercial platforms on a global scale; substantially expanding its portfolio of medicines; diversifying by geography, product type and channel; maintaining its commitment to quality; and cultivating its global workforce. Business Model and Operations At Viatris, we have a relentless focus on delivering access at scale.
The agreements also provide Viatris a right of first refusal and a right of first negotiation for certain other assets in Idorsia’s pipeline. The closing of the transaction is subject to certain closing conditions.
The agreements also provide Viatris a right of first refusal and a right of first negotiation for certain other assets in Idorsia’s pipeline.
We expect to retain some selective R&D capabilities in API and to continue to have access to adequate API supplies through a manufacturing and supply agreement with the API business buyer and our arrangements with other manufacturers.
After completing the divestiture of our API business in India, we continue to maintain some selective R&D capabilities in API and believe we have access to adequate API supplies through a manufacturing and supply agreement with the API business buyer and our arrangements with other manufacturers.
We also grew our initial Employee Resource Groups, which include EmpoWer advocating for an ecosystem that empowers women to reach their full potential; VIVID supporting LGBTQ+ employees and allies; RISE supporting our colleagues of African descent; and Care, advocating for caregivers with the Company.
Our Employee Resource Groups have expanded to include EmpoWer advocating for an ecosystem that empowers women to reach their full potential; VIVID supporting LGBTQ+ employees and allies; RISE supporting our colleagues of African descent; and Care, advocating for caregivers.
With what we believe is an extensive portfolio of medicines to meet nearly every health need, a one-of-a-kind global supply chain designed to reach more people with health solutions when and where they need them, and the scientific expertise to address some of the world’s most enduring health challenges, access takes on deeper meaning at Viatris.
We see access as fundamental to empowering people worldwide to live healthier at every stage of life—a powerful concept in challenging times. 8 Table of Contents With what we believe is an extensive portfolio of medicines to meet nearly every health need, a one-of-a-kind global supply chain designed to reach more people with health solutions when and where they need them, and the scientific expertise to address some of the world’s most enduring health challenges, access takes on deeper meaning at Viatris.
Viatris collaborates with many organizations to help prevent, diagnose, and treat many cardiovascular illnesses. Our deep experience in emerging and developed markets affords a tried-and-true method of achieving high impact across the patient experience, from awareness to adherence.
With our acquisition of selatogrel and licensing agreement for sotagliflozin, we are continuing to build on our strong presence in cardiovascular disease. Viatris collaborates with many organizations to help prevent, diagnose, and treat cardiovascular illnesses. Our deep experience in emerging and developed markets affords a tried-and-true method of achieving high impact across the patient experience, from awareness to adherence.
Viatris currently markets prescription brand and generic drugs, including complex drugs. Brand drugs typically are prescription pharmaceuticals that are sufficiently novel as to be protected by patents or other forms of exclusivity. As such, these drugs, which bear trade names, may be produced and sold only by those owning the rights, subject to certain challenges that other companies may make.
Branded drugs are typically prescription pharmaceuticals that are sufficiently novel as to be protected by patents or other forms of exclusivity. As such, these drugs, which bear trade names, may be produced and sold only by those owning the rights, subject to certain challenges that other companies may make. Developing new medicines can take years and significant investment.
Developing new medicines can take years and significant investment. Only a few promising therapies ever enter clinical trials. Fewer still are approved for sale by health authorities, at which point marketing to healthcare providers and consumers begins. Because patents and exclusivities last many years, they serve as an incentive to developers.
Only a few promising therapies ever enter clinical trials. Fewer still are approved for sale by health authorities, at which point marketing to healthcare providers and consumers begins. Because patents and exclusivities last many years, they serve as an incentive to developers. During the periods protected, developers often recoup their investments and earn a profit.
Viatris’ executive management team is focused on ensuring that the Company is optimally structured and efficiently resourced to deliver sustainable value to patients, shareholders, customers and other key stakeholders.
Viatris’ executive management team is focused on ensuring that the Company is optimally structured and efficiently resourced to deliver sustainable value to patients, shareholders, customers and other key stakeholders. The Company operates in more than 165 countries and territories with approximately 32,000 employees.
We also have an extensive patent portfolio and actively file for patent protection in various countries to protect our brand-name, generic, branded generic, and OTC products, including processes for making and using them. We have more than 3,300 patents filed globally.
The Company also has an extensive patent portfolio and actively files for patent protection in various countries to protect its brand-name, generic, branded generic, and remaining OTC products, including processes for making and using them. The Company has more than 2,400 patents filed globally.
And that means further expanding beyond our current scope into more innovative products, including NCEs and 505(b)(2) products. 10 Table of Contents LEADERSHIP Viatris is advancing sustainable operations and innovative solutions to improve patient health and support more resilient healthcare systems. Viatris is committed to providing steady leadership in a world that is constantly evolving.
And that means further expanding beyond our current scope into more innovative products, including innovative, best-in-class, patent-protected assets that address areas of significant unmet medical need. LEADERSHIP Viatris is advancing sustainable operations and innovative solutions to improve patient health and support more resilient healthcare systems. Viatris is committed to providing steady leadership in a world that is constantly evolving.
Effective as of November 16, 2020, Upjohn, Mylan and Pfizer consummated the combination of Mylan with the Upjohn Business through a Reverse Morris Trust transaction, Viatris became the parent entity of the combined Upjohn Business and Mylan business, and Upjohn changed its name to “Viatris Inc.”.
Effective as of November 16, 2020, Upjohn, Mylan and Pfizer consummated the combination of Mylan with the Upjohn Business through a Reverse Morris Trust transaction, Viatris became the parent entity of the combined Upjohn Business and Mylan business, and Upjohn changed its name to “Viatris Inc.” As a result of the Combination, Mylan ceased to exist as a separate legal entity after merging with and into Mylan II B.V., an indirect wholly owned subsidiary of Viatris.
Pharmaceutical wholesalers/distributors purchase prescription medicines and other medical products directly from manufacturers for storage in warehouses and distribution centers. The distributors then fill orders placed by healthcare providers and other authorized buyers. Pharmaceutical retailers purchase products directly from manufacturers or wholesalers/distributors. They then sell them to consumers in relatively small quantities for personal use.
The distributors then fill orders placed by healthcare providers and other authorized buyers. Pharmaceutical retailers purchase products directly from manufacturers or wholesalers/distributors. They then sell them to consumers in relatively small quantities for personal use. Institutional pharmacies address the unique needs of hospitals, nursing homes and other such venues.
We believe Viatris is well positioned to serve such customers in the Developed Markets due to the scale we have built in terms of R&D, manufacturing, and portfolio breadth. Greater China The Greater China segment includes our operations in mainland China, Taiwan, and Hong Kong. The Viatris Greater China portfolio predominantly consists of branded LOE products.
Viatris believes it is well positioned to serve such customers in the Developed Markets due to the scale it has built in terms of R&D, supply chain, and portfolio breadth. 15 Table of Contents Greater China The Greater China segment includes our operations in mainland China, Taiwan, and Hong Kong.
As discussed above, the Company has entered into a definitive agreement to divest its API business in India. • Robust global technical resources , including thousands of scientists, regulatory experts and medical and product safety professionals working around the world on innovative therapies and solutions for patients everywhere. • Strong global commercial team , including sales team members and marketing professionals whose goal is to ensure that products are shipped to customers around the globe. • Diverse and differentiated global portfolio includes products in more than 10 major therapeutic areas, including both infectious diseases and NCDs and medicines that treat the top 10 leading causes of death globally, as determined by the WHO.
We are committed to advancing responsible and sustainable operations and work diligently to minimize our environmental footprint across the Viatris network while safeguarding access to medicine. • Robust global technical resources , including thousands of scientists, regulatory experts, clinical, medical and product safety professionals working around the world on innovative therapies and solutions for patients everywhere. • Strong global commercial team , including sales team members and marketing professionals whose goal is to ensure that our products reach customers around the globe. • Diverse and differentiated global portfolio includes products in more than 10 major therapeutic areas, including both infectious diseases and NCDs, and medicines that help treat the top 10 leading causes of death globally, as determined by the WHO.
We rely on cost-effective manufacturing processes to meet the rapidly changing needs of our customers around a reliable, high quality supply of pharmaceutical products.
Viatris relies on a flexible and cost-effective supply chain to meet the rapidly changing needs of its customers around a reliable, high-quality supply of pharmaceutical products.
All major Viatris brands are included in the VBP molecule lists. We have re-balanced our business to expand our focus on the retail pharmacy and e-commerce channels while maintaining our presence in the hospital channel.
The VBP policy for LOE molecules is now in its sixth year and includes approximately 400 molecules. All major Viatris brands are included in the VBP molecule lists. The Company has re-balanced its business to expand its focus on the retail pharmacy and e-commerce channels while maintaining its presence in the hospital channel.
Our colleagues are leading our mission and we continue to build our culture with a focus on colleague experience and engagement; learning and development; career progression; DEI; talent attraction and our deep commitment to the health, safety and wellbeing of our colleagues, their families and the communities we serve.
Our colleagues are dedicated to our mission and we continue to build our culture with a focus on colleague experience and engagement; learning and development; career progression; workplace culture; talent attraction and our deep commitment to the health, safety and wellbeing of our colleagues, their families and the communities we serve. 19 Table of Contents We remain committed to building upon our foundations, harmonizing our processes and programs and initiating many firsts for Viatris.
We rely on the aforementioned types of intellectual property, as well as our copyrights, trade dress, regulatory exclusivities and contractual protections, to establish a broad scope of intellectual property rights for our product portfolio. Sustainability To learn about our sustainability work in depth, we encourage you to read our 2022 Sustainability Report 1 .
Viatris relies on the aforementioned types of intellectual property, as well as our copyrights, trade dress, regulatory exclusivities and contractual protections, to establish a broad scope of intellectual property rights for our product portfolio.
The table below displays the percentage of consolidated net sales to our largest customers during the years ended December 31, 2023, 2022 and 2021: Percentage of Consolidated Net Sales 2023 2022 2021 McKesson Corporation 10 % 11 % 9 % AmerisourceBergen Corporation 10 % 10 % 9 % Cardinal Health, Inc. 5 % 5 % 5 % We serve our customers through a team of highly-skilled sales and marketing professionals, all of whom are focused on establishing Viatris as our customers’ partner of choice.
(formerly AmerisourceBergen Corporation) 12 % 10 % 10 % Cardinal Health, Inc. * 5 % 5 % * Net sales represented less than 10% of consolidated net sales during the period. We serve our customers through a team of highly-skilled sales and marketing professionals, all of whom are focused on establishing Viatris as our customers’ partner of choice.
The Company’s business in North America is driven mainly by our operations in the U.S., where we are one of the largest providers of prescription medicines. The U.S. pharmaceutical industry is very competitive, and the primary means of competition are innovation and development, timely FDA approval, manufacturing capabilities, product quality, marketing, portfolio size, customer service, reputation and price.
The U.S. pharmaceutical industry is very competitive, and the primary means of competition are innovation and development, timely FDA approval, manufacturing and supply chain capabilities, product quality, marketing, portfolio size, customer service, reputation and price.
The Company remains committed to maintaining the highest quality manufacturing standards at its facilities around the world and to continuous assessment and improvement in a time of evolving industry dynamics and regulatory expectations. Customers and Marketing Our customers include retail and pharmacy establishments, wholesalers and distributors, payers, insurers and governments, and institutions such as hospitals; among others.
The Company remains committed to maintaining the highest quality manufacturing standards at its facilities around the world and to continuous assessment and improvement in a time of evolving industry dynamics and regulatory expectations.
Most importantly, protecting the health and safety of our colleagues is essential at Viatris. We have a global Environmental, Health and Safety Management System, technical requirements, processes and systems that establish the foundation of this program. These elements apply to all locations and guide us in cultivating a culture of health and safety throughout our global workforce.
We have a global Environmental, Health and Safety Management System, technical requirements, processes and systems that establish the foundation of our health and safety program. This focus, along with our deep commitment to wellbeing, applies to all locations and guides us in cultivating a culture of health and safety throughout our global workforce.
For example, we are working on a number of programs including the potential to be first to market for our generics of Abilify Maintena®, Injectafer®, Invega Trinza®, Ozempic®, Venofer® and Wegovy™.
For example, the Company is working on a number of programs including the potential to be first-to-market for our generics of Abilify Maintena®, Injectafer®, Invega Trinza®, Ozempic®, Venofer® and Wegovy™. The Company is also working with its partners on novel and/or complex products such as our biosimilar to BOTOX® (onabotulinumtoxinA).

… 137 more changes not shown on this page.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

200 edited+38 added−39 removed243 unchanged
Biggest changeA significant escalation or expansion of the conflict’s current scope may have a negative impact on our operations and financial results in future periods; • changes in laws, regulations, and practices that impact the pharmaceutical industry and/or healthcare systems, including but not limited to imports, exports, manufacturing, quality, cost, pricing, reimbursement, approval, inspection, and delivery of healthcare; • changes in policies designed to promote foreign investment, including significant tax incentives, liberalized import and export duties, and preferential rules on foreign investment and repatriation; • differing local product preferences and product requirements; • adverse changes in the economies in which we or our partners and suppliers operate as a result of a slowdown in overall growth; • changes in government or economic policies, elections, or financial, political, or social change or instability that affects the markets or countries in which we or our partners operate; • changes in employment or labor laws, or wage increases in the countries in which we or our partners and suppliers operate; • local, regional and global restrictions on banking and commercial activities in certain markets, especially emerging markets; • longer payment cycles and increased exposure to counterparty risk; • volatility in international financial markets and increased foreign currency risk; • inflation or hyperinflation in certain markets, including Turkey; • supply disruptions and increases in energy and transportation costs; • increased tariffs on the import or export of our products or API, including on imports from China to the U.S. as a result of the escalation of trade tensions between the countries or otherwise; • burdens to comply with multiple, changing and potentially conflicting laws, regulations and disclosure requirements, including those relating to environmental, social and governance matters, carbon emissions, health and safety, labor and human rights; • natural or man-made disasters, including droughts, floods, earthquakes, hurricanes and the impact of climate change in the countries in which we or our partners and suppliers operate; and • local disturbances, the outbreak of highly contagious diseases or other health epidemics or pandemics, terrorist attacks, riots, social disruption, wars, or regional hostilities in the countries in which we or our partners and suppliers operate and that could affect the economy, our operations and employees by disrupting operations and communications, making travel and the conduct of our business more difficult, and/or causing our customers to be concerned about our ability to meet their needs.
Biggest changeA significant escalation or expansion of the conflict’s current scope may have a negative impact on our operations and financial results in future periods; • changes in laws, regulations, and practices that impact the pharmaceutical industry and/or healthcare systems, including but not limited to imports, exports, manufacturing, quality, cost, pricing, reimbursement, approval, inspection, and delivery of healthcare; • changes in policies designed to promote foreign investment, including significant tax incentives, liberalized import and export duties, and preferential rules on foreign investment and repatriation; • differing local product preferences and product requirements; • adverse changes in the economies in which we or our partners and suppliers operate as a result of a slowdown in overall growth; • changes in government or economic policies, elections, or financial, political, or social change or instability that affects the markets or countries in which we or our partners operate; • reductions in funding by U.S. governmental agencies for certain products in our Emerging Markets region; • changes in employment or labor laws, or wage increases in the countries in which we or our partners and suppliers operate; • local, regional and global restrictions on banking and commercial activities in certain markets, especially emerging markets; • longer payment cycles and increased exposure to counterparty risk; • volatility in international financial markets and increased foreign currency risk; • inflation or hyperinflation in certain markets, including Turkey and Egypt; • supply disruptions and increases in energy and transportation costs; • increased tariffs on the import or export of our products, ingredients or inputs into our products, or API, including potentially significant reciprocal tariffs on products sold between the U.S. and other countries as a result of recent trade policy shifts in the U.S.; • changes in U.S. government procurement laws for pharmaceutical products related to compliance with the Trade Agreements Act or country of origin policies, or changes in U.S. agency procurement policies for pharmaceutical products manufactured in India or China; • burdens to comply with multiple, changing and potentially conflicting laws, regulations and disclosure requirements, including those relating to environmental, social and governance matters, carbon emissions, health and safety, labor and human rights; • natural or man-made disasters, including droughts, floods, earthquakes, hurricanes, wildfires and the impact of climate change in the countries in which we or our partners and suppliers operate; and • local disturbances, the outbreak of highly contagious diseases or other health epidemics or pandemics, terrorist attacks, riots, social disruption, wars, or regional hostilities in the countries in which we or our partners and suppliers operate and that could affect the economy, our operations and employees by disrupting operations and communications, making travel and the conduct of our business more difficult, and/or causing our customers to be concerned about our ability to meet their needs.
Treasury’s Office of Foreign Assets Control, the Iran Threat Reduction and Syria Human Rights Act of 2012 and rules relating to the use of certain “conflict minerals” under Section 1502 of the Dodd-Frank Wall Street Reform and the Consumer Protection Act; • sanctions and our interpretation of those sanctions, trade controls, supply chain and staffing challenges as a result of the ongoing conflict between Russia and Ukraine that have impacted and may continue to impact our ability to market or sell pharmaceuticals in either country or subject us to increased government scrutiny, and a significant escalation or expansion of the conflict’s current scope may have a negative impact on our operations and financial results in future periods; • instability in the Middle East, especially the ongoing conflict in Israel and Gaza, has impacted and may continue to impact our and our partners’ ability to develop and manufacture products in the region and to transport those products to other markets, and may impact the ability of regulators to conduct required inspections at our or our partners’ manufacturing facilities in the region.
Treasury’s Office of Foreign Assets Control, the Iran Threat Reduction and Syria Human Rights Act of 2012 and rules relating to the use of certain “conflict minerals” under Section 1502 of the Dodd-Frank Wall Street Reform and the Consumer Protection Act; • sanctions and our interpretation of those sanctions, trade controls, supply chain and staffing challenges as a result of the ongoing conflict between Russia and Ukraine that have impacted and may continue to impact our ability to market or sell pharmaceuticals in either country or subject us to increased government scrutiny, and a significant escalation or expansion of the conflict’s current scope may have a negative impact on our operations and financial results in future periods; • instability in the Middle East, especially the ongoing conflict in Israel and Gaza, has impacted and may continue to impact our and our partners’ ability to develop and manufacture products in the region and to transport those products to other markets, and has impacted and may continue to impact the ability of regulators to conduct required inspections at our or our partners’ manufacturing facilities in the region.
A significant disruption at any such facilities within our internal or third-party supply chain, even on a short-term basis, whether due to the failure of a third-party supplier to fulfill the terms of their agreement with us, labor disruption, adverse quality or compliance observation, other regulatory action, infringement of brand or other third-party intellectual property rights, natural disaster, civil or political unrest, export or import restrictions, or other events could impair our ability to produce and ship products to the market on a timely basis and could, among other consequences, subject us to exposure to claims from customers.
A significant disruption at any facilities within our internal or third-party supply chain, even on a short-term basis, whether due to the failure of a third-party supplier to fulfill the terms of their agreement with us, labor disruption, adverse quality or compliance observation, other regulatory action, infringement of brand or other third-party intellectual property rights, natural disaster, civil or political unrest, export or import restrictions, or other events could impair our ability to produce and ship products to the market on a timely basis and could, among other consequences, subject us to exposure to claims from customers.
Our level of indebtedness could have important consequences, including but not limited to: • increasing our vulnerability to general adverse economic and industry conditions; • requiring us to dedicate a substantial portion of our cash flow from operations to make debt service payments, or repay debt as it matures, thereby reducing the availability of cash flow to fund working capital, capital expenditures, acquisitions and investments, dividend payments or share repurchases, and other general corporate purposes; • limiting our flexibility in planning for, or reacting to, challenges and opportunities, and changes in our businesses and the markets in which we operate; • limiting our ability to obtain additional financing to fund our working capital, capital expenditures, acquisitions and debt service requirements and other financing needs; • increasing our vulnerability to increases in interest rates in general related to any of our indebtedness that bears interest at floating rates or when refinancing maturing debt at higher rates; • increasing our exposure to currency fluctuations, since a significant portion of our indebtedness is denominated in currencies other than the U.S. dollar, such as our Euro and Japanese yen denominated debt; and • placing us at a competitive disadvantage to our competitors that have less debt.
Our level of indebtedness could have important consequences, including but not limited to: • increasing our vulnerability to general adverse economic and industry conditions; • requiring us to dedicate a substantial portion of our cash flow from operations to make debt service payments, or repay debt, thereby reducing the availability of cash flow to fund working capital, capital expenditures, acquisitions and investments, dividend payments or share repurchases, and other general corporate purposes; • limiting our flexibility in planning for, or reacting to, challenges and opportunities, and changes in our businesses and the markets in which we operate; • limiting our ability to obtain additional financing to fund our working capital, capital expenditures, acquisitions and debt service requirements and other financing needs; • increasing our vulnerability to increases in interest rates in general related to any of our indebtedness that bears interest at floating rates or when refinancing maturing debt at higher rates; • increasing our exposure to currency fluctuations, since a significant portion of our indebtedness is denominated in currencies other than the U.S. dollar, such as our Euro and Japanese yen denominated debt; and • placing us at a competitive disadvantage to our competitors that have less debt.
These strategies include, but are not limited to: • entering into agreements whereby other generic companies will begin to market an authorized generic, which is the approved brand-name drug without the brand-name on its label, at the same time or after generic competition initially enters the market; • launching their own authorized generic product prior to or at the same time or after generic competition initially enters the market; • pricing a branded product at a discount equivalent to generic pricing; • filing frivolous petitions with the FDA or other regulatory bodies seeking to prevent or delay approvals, including timing the frivolous filings so as to thwart generic competition by causing delays of our product approvals; 33 Table of Contents • contracting strategies among pharmaceutical manufacturers and PBMs that could decrease generic or biosimilar utilization and negatively impact our product launches; • seeking to establish regulatory and legal obstacles that would make it more difficult to demonstrate bioequivalence or to meet other requirements for approval, and/or to prevent regulatory agency review of applications; • initiating legislative or other efforts to limit the substitution of generic versions of brand pharmaceuticals; • filing suits for patent infringement and other claims that may delay or prevent regulatory approval, manufacture, and/or sale of generic products; • introducing “next-generation” products prior to the expiration of market exclusivity for the reference product, which often materially reduces the demand for the generic or the reference product for which we seek regulatory approval; • persuading regulatory bodies to withdraw the approval of brand-name drugs for which the patents are about to expire and converting the market to another product of the brand company on which longer patent protection exists; • obtaining extensions of market exclusivity by conducting clinical trials of brand drugs in pediatric populations or by other methods; and • seeking to obtain new patents on drugs for which patent protection is about to expire.
These strategies include, but are not limited to: • entering into agreements whereby other generic companies will begin to market an authorized generic, which is the approved brand-name drug without the brand-name on its label, at the same time or after generic competition initially enters the market; • launching their own authorized generic product prior to or at the same time or after generic competition initially enters the market; • pricing a branded product at a discount equivalent to generic pricing; • filing frivolous petitions with the FDA or other regulatory bodies seeking to prevent or delay approvals, including timing the frivolous filings so as to thwart generic competition by causing delays of our product approvals; • contracting strategies among pharmaceutical manufacturers and PBMs that could decrease generic or biosimilar utilization and negatively impact our products; 32 Table of Contents • seeking to establish regulatory and legal obstacles that would make it more difficult to demonstrate bioequivalence or to meet other requirements for approval, and/or to prevent regulatory agency review of applications; • initiating legislative or other efforts to limit the substitution of generic versions of brand pharmaceuticals; • filing suits for patent infringement and other claims that may delay or prevent regulatory approval, manufacture, and/or sale of generic products; • introducing “next-generation” products prior to the expiration of market exclusivity for the reference product, which often materially reduces the demand for the generic or the reference product for which we seek regulatory approval; • persuading regulatory bodies to withdraw the approval of brand-name drugs for which the patents are about to expire and converting the market to another product of the brand company on which longer patent protection exists; • obtaining extensions of market exclusivity by conducting clinical trials of brand drugs in pediatric populations or by other methods; and • seeking to obtain new patents on drugs for which patent protection is about to expire.
We may miscalculate the risks associated with our strategic initiatives at the time they are made or not have the resources or ability to access all the relevant information to evaluate them properly, including with regard to the potential of R&D pipelines, manufacturing issues, compliance issues, or the outcome of ongoing legal and other proceedings.
We may miscalculate the risks associated with our strategic initiatives and priorities at the time they are made or not have the resources or ability to access all the relevant information to evaluate them properly, including with regard to the potential of R&D pipelines, manufacturing issues, compliance issues, or the outcome of ongoing legal and other proceedings.
In 2022, President Biden signed into law the Inflation Reduction Act, which includes numerous Medicare reforms that will affect reimbursement for certain pharmaceuticals covered by Medicare and modify the Part D and Part B program structure, including shifting the liability for certain prescription drug costs shared between Medicare, pharmaceutical manufacturers, and Part D plans.
In 2022, then-President Biden signed into law the Inflation Reduction Act, which includes numerous Medicare reforms that will affect reimbursement for certain pharmaceuticals covered by Medicare and modify the Part D and Part B program structure, including shifting the liability for certain prescription drug costs shared between Medicare, pharmaceutical manufacturers, and Part D plans.
The overall execution of our strategic initiatives may result in material unanticipated problems, expenses, liabilities, competitive responses, operational inefficiencies, adverse tax consequences, impairment or restructuring charges, loss of customer relationships, difficulty attracting and retaining qualified employees, and diversion of management’s and/or employee’s attention, among other potential adverse consequences.
The overall execution of our strategic initiatives and priorities may result in material unanticipated problems, expenses, liabilities, competitive responses, operational inefficiencies, adverse tax consequences, impairment or restructuring charges, loss of customer relationships, difficulty attracting and retaining qualified employees, and diversion of management’s and/or employee’s attention, among other potential adverse consequences.
Our reporting and payment obligations related to our participation in U.S. federal healthcare programs, including Medicare, Medicaid and the VA, are complex and often involve subjective decisions that could change as a result of new business circumstances, new regulations or agency guidance, or advice of legal counsel.
Our reporting and payment obligations related to our participation in U.S. federal healthcare programs, including Medicare, Medicaid and the VA, are complex and often involve subjective decisions that could change as a result of new business circumstances, new laws, regulations or agency guidance, or advice of legal counsel.
Viatris has in the past undertaken and may in the future undertake restructuring programs in order to achieve synergies and ensure the Company is optimally structured and efficiently resourced. The process of integrating operations and implementing restructuring initiatives could cause an interruption of, or loss of momentum in, the activities of one or more of Viatris’ businesses.
Viatris has also in the past undertaken and may in the future undertake restructuring programs in order to achieve synergies and ensure the Company is optimally structured and efficiently resourced. The process of integrating operations and implementing restructuring initiatives could cause an interruption of, or loss of momentum in, the activities of one or more of Viatris’ businesses.
We have potential tax exposures resulting from the varying application of statutes, regulations, and interpretations which include exposures on intercompany terms of cross-border arrangements among our subsidiaries (including intercompany loans, sales, and services agreements) in relation to various aspects of our business, including manufacturing, marketing, sales, and delivery functions.
We have potential tax exposures resulting from the varying application of statutes, regulations, and interpretations which include exposures on intercompany terms of cross-border arrangements among our subsidiaries (including intercompany loans, licenses, sales, and services agreements) in relation to various aspects of our business, including manufacturing, marketing, sales, and delivery functions.
In addition, rising rates of inflation have increased and may continue to increase pressure on governments, insurers and other payors to implement additional cost containment measures. There is no guarantee that these cost containment measures will be rolled back in the event that inflation rates decrease in the future.
In addition, rates of inflation have increased and may continue to increase pressure on governments, insurers and other payors to implement additional cost containment measures. There is no guarantee that these cost containment measures will be rolled back in the event that inflation rates decrease in the future.
If proposals like these in the U.S., EU, or in other countries where we or our partners and suppliers operate were to become effective, or if any other actions by our competitors and other third parties to prevent or delay activities necessary to the approval, manufacture, or distribution of our products are successful, our entry into the market and our ability to generate revenues associated with new products may be delayed, reduced, or eliminated, which could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
If proposals like these in the U.S., EU, or in other countries where we or our partners and suppliers operate were to become effective, or if any other actions by our competitors and other third parties to prevent or delay activities necessary to the approval, manufacture, or distribution of our products are successful, our entry into the market and our ability to generate revenues associated with new products may be delayed, reduced, or eliminated, which could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
With respect to government enforcement of state and federal laws, including antitrust laws, as well as private plaintiff litigation of so-called “pay for delay” patent settlements, large verdicts, settlements or government fines are possible, especially in the U.S. and EU.
With respect to government enforcement of state and federal laws, including antitrust laws, as well as private plaintiff litigation of antitrust claims, including so-called “pay for delay” patent settlements, large verdicts, settlements or government fines are possible, especially in the U.S. and EU.
After we complete an acquisition, the following factors could result in material charges and adversely affect our operating results and may adversely affect our cash flows: • costs incurred to combine the operations of companies we acquire, such as transitional employee expenses and employee retention, redeployment or relocation expenses; • liabilities assumed in purchase accounting; • impairment of goodwill or intangible assets, including acquired IPR&D; • amortization of intangible assets acquired; • a reduction in the useful lives of intangible assets acquired; • identification of or changes to assumed contingent liabilities, including, but not limited to, litigation reserves, contingent purchase price consideration including fair value adjustments, income tax contingencies and other non-income tax contingencies, after our final determination of the amounts for these contingencies or the conclusion of the measurement period (generally up to one year from the acquisition date), whichever comes first; • significant costs to restructure our operations and to reduce our cost structure, including cost related to severance payments, plant shutdowns and costs to achieve anticipated synergies; and • charges to our operating results resulting from expenses incurred to effect the acquisition.
After we complete an acquisition, the following factors could result in material charges and adversely affect our operating results and may adversely affect our cash flows: 27 Table of Contents • costs incurred to combine the operations of companies we acquire, such as transitional employee expenses and employee retention, redeployment or relocation expenses; • liabilities assumed in purchase accounting; • impairment of goodwill or intangible assets, including acquired IPR&D; • amortization of intangible assets acquired; • a reduction in the useful lives of intangible assets acquired; • identification of or changes to assumed contingent liabilities, including, but not limited to, litigation reserves, contingent purchase price consideration including fair value adjustments, income tax contingencies and other non-income tax contingencies, after our final determination of the amounts for these contingencies or the conclusion of the measurement period (generally up to one year from the acquisition date), whichever comes first; • significant costs to restructure our operations and to reduce our cost structure, including cost related to severance payments, plant shutdowns and costs to achieve anticipated synergies; and • charges to our operating results resulting from expenses incurred to effect the acquisition.
Additionally, changes in the effective tax rate as a result of a change in the mix of earnings in countries with differing statutory tax rates, changes in our overall profitability, changes in the valuation of deferred tax assets and liabilities, changes in tax laws or in their application, the results of audits and the examination of previously filed tax returns and related challenges and assessments by taxing authorities, and continuing assessments of our tax exposures could impact our tax liabilities, income tax expense and cash taxes paid, which could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
Additionally, changes in the effective tax rate as a result of a change in the mix of earnings in countries with differing statutory tax rates, changes in our overall profitability, changes in the valuation of deferred tax assets and liabilities, changes in tax laws or in their application, the results of audits and the examination of previously filed tax returns and related challenges and assessments by taxing authorities, and continuing assessments of our tax exposures could impact our tax liabilities, income tax expense and cash taxes paid, which could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
Although we believe our cross-border arrangements among our subsidiaries are based upon internationally accepted standards and applicable law, tax authorities in various jurisdictions may disagree with and subsequently challenge the amount of profits taxed in their country, which may result in increased tax liability, including accrued interest and penalties, which would cause our tax expense to increase and could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
Although we believe our cross-border arrangements among our subsidiaries are based upon internationally accepted standards and applicable law, tax authorities in various jurisdictions may disagree with and subsequently challenge the amount of profits taxed in their country, which may result in increased tax liability, including accrued interest and penalties, which would cause our tax expense to increase and could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
These integration and restructuring processes have in the past and may in the future require Viatris’ senior management to devote considerable amounts of time to these processes, which could decrease the time they have to manage and service Viatris’ businesses, and develop new products or strategies.
These integration and restructuring processes have in the past and may in the future require Viatris’ senior management to devote considerable amounts of time to these processes, which has in the past and could in the future decrease the time they have to manage and service Viatris’ businesses, and develop new products or strategies.
Maintaining the security, confidentiality and integrity of this confidential information (including trade secrets or other intellectual property, proprietary business information and personal information) is important to our competitive business position. However, such information can be difficult and costly to protect.
Maintaining our access to and the security, confidentiality and integrity of this confidential information (including trade secrets or other intellectual property, proprietary business information and personal information) is important to our competitive business position. However, such information can be difficult and costly to protect.
Bribery Act, Chinese anti-corruption laws and similar worldwide anti-corruption laws, which impose restrictions on certain conduct and may carry substantial fines and penalties. ◦ Our competitors, including branded pharmaceutical companies, and/or other third parties, may allege that we or our suppliers are infringing upon their intellectual property, including in an “at risk launch” situation, which could result in substantial monetary damages, impact our ability to launch a product and/or our ability to continue marketing a product, and/or force us to expend substantial resources in resulting litigation, the outcome of which is uncertain. ◦ We are involved in various legal proceedings and certain government inquiries and may experience unfavorable outcomes of such proceedings or inquiries. ◦ We are increasingly dependent on IT and information systems and our systems and infrastructure face certain risks, including cybersecurity and data leakage risks. • Finance Risks ◦ There can be no guarantee that we will continue to pay dividends or repurchase shares under our stock buyback program. ◦ We may not be able to maintain competitive financial flexibility and our corporate tax rate which could adversely affect us and our shareholders. ◦ Currency fluctuations and changes in exchange rates have impacted and could continue to adversely affect our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price. ◦ We have significant indebtedness, which could lead to adverse consequences or adversely affect our financial position and prevent us from fulfilling our obligations under such indebtedness, and any refinancing of this debt could be at significantly higher interest rates. ◦ There are inherent uncertainties involved in estimates, judgments and assumptions used in the preparation of financial statements in accordance with U.S.
Bribery Act, Chinese anti-corruption laws and similar worldwide anti-corruption laws, which impose restrictions on certain conduct and may carry substantial fines and penalties. ◦ Our competitors, including branded pharmaceutical companies, and/or other third parties, may allege that we or our suppliers are infringing upon their intellectual property, including in an “at risk launch” situation, 21 Table of Contents which could result in substantial monetary damages, impact our ability to launch a product and/or our ability to continue marketing a product, and/or force us to expend substantial resources in resulting litigation, the outcome of which is uncertain. ◦ We are involved in various legal proceedings and certain government inquiries and may experience unfavorable outcomes of such proceedings or inquiries. ◦ We are increasingly dependent on IT and information systems and our systems and infrastructure face certain risks, including cybersecurity and data leakage risks. • Finance Risks ◦ There can be no guarantee that we will continue to pay dividends or repurchase shares under our share repurchase program. ◦ We may not be able to maintain competitive financial flexibility and our corporate tax rate which could adversely affect us and our shareholders. ◦ Currency fluctuations and changes in exchange rates have impacted and could continue to adversely affect our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price. ◦ We have significant indebtedness, which could lead to adverse consequences or adversely affect our financial position and prevent us from fulfilling our obligations under such indebtedness, and any refinancing of this debt could be at significantly higher interest rates. ◦ There are inherent uncertainties involved in estimates, judgments and assumptions used in the preparation of financial statements in accordance with U.S.
Please also refer to “ A significant portion of our revenues is derived from sales to a limited number of customers.” The numerous cost-containment measures by governments and other payors, failing to win tenders, the implementation of price control systems, adverse legislation and regulation, the consolidation of our customers, or continued social or government pressure to lower the cost of pharmaceutical products could have a material adverse impact on our business, reputation, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
Please also refer to “ A significant portion of our revenues is derived from sales to a limited number of customers.” The numerous cost-containment measures by governments and other payors, failing to win tenders, the implementation of price control systems, adverse legislation and regulation, the consolidation of our customers, or continued social or government pressure to lower the cost of pharmaceutical products could have a material adverse impact on our business, reputation, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
Alternatively, if a court were to find these exclusive forum provisions inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings described above, Viatris may incur additional costs associated with resolving such matters in other jurisdictions or forums, which could materially and adversely affect Viatris’ business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
Alternatively, if a court were to find these exclusive forum provisions inapplicable to, or unenforceable in respect of, one or more of the specified types of actions or proceedings described above, Viatris may incur additional costs associated with resolving such matters in other jurisdictions or forums, which could materially and adversely affect Viatris’ business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
If Pfizer were to dispute its retention of these matters, or if there is an adverse outcome in the matters that Pfizer has agreed to retain, this could have an adverse impact on Viatris.
If Pfizer were to successfully dispute its retention of these matters, or if there is an adverse outcome in the matters that Pfizer has agreed to retain, this could have an adverse impact on Viatris.
Other related factors that could affect our business include: • Competitors’ products may be safer, more effective, more effectively marketed or sold, or have lower prices or better performance features than ours; • PBMs and other pharmaceutical manufacturers may utilize contracting strategies that could decrease utilization of or otherwise negatively impact our products; • Vertical integration of pharmacies and large purchasing organizations or consolidation among distribution outlets; and • Our sales have suffered and may suffer in the future as a result of changes in consumer demand for our products, including those related to fluctuations in consumer buying patterns tied to seasonality or other factors, willingness of 30 Table of Contents customers to switch among products of different pharmaceutical manufacturers, importation by consumers or the introduction of new products by competitors.
Other related factors that could affect our business include: • Competitors’ products may be safer, more effective, more effectively marketed or sold, or have lower prices or better performance features than ours; • PBMs and other pharmaceutical manufacturers may utilize contracting strategies that could decrease utilization of or otherwise negatively impact our products; • Vertical integration of pharmacies and large purchasing organizations or consolidation among distribution outlets; and • Our sales have suffered and may suffer in the future as a result of changes in consumer demand for our products, including those related to fluctuations in consumer buying patterns tied to seasonality or other factors, willingness of customers to switch among products of different pharmaceutical manufacturers, importation by consumers or the introduction of new products by competitors.
For example, the EU has implemented particularly stringent regulations with respect to manufacturing standards for API imported into Europe that place the certification requirement on the regulatory bodies of the exporting countries.
The EU has implemented particularly stringent regulations with respect to manufacturing standards for API imported into Europe that place the certification requirement on the regulatory bodies of the exporting countries.
Even in the case of indemnification, there are risks inherent in such indemnities and, accordingly, there can be no assurance that we will receive the full benefits of such indemnification, or that we will not experience an adverse result in a matter that is not indemnified, which could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
Even in the case of indemnification, there are risks inherent in such indemnities and, accordingly, there can be no assurance that we will receive the full benefits of such indemnification, or that we will not experience an adverse result in a matter that is not indemnified, which could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
We are or may be involved in various legal proceedings and certain government inquiries or investigations, including, but not limited to, patent infringement, product liability, personal injury, securities fraud, claims with respect to the manufacture, sale, marketing and distribution of opioid products, antitrust matters, breach of contract, and claims involving Medicare, Medicaid and/or VA reimbursements, or laws relating to sales, marketing, and pricing practices.
We are or may be involved in various legal proceedings and certain government inquiries or investigations, including, but not limited to, patent infringement, product liability, personal injury, securities fraud, claims with respect to the manufacture, sale, marketing and distribution of opioid products, antitrust matters, breach of contract, consumer protection matters, and claims involving Medicare, Medicaid and/or VA reimbursements, or laws relating to sales, marketing, and pricing practices.
An adverse decision in a case such as this, or a judicial order preventing us or our suppliers and partners from manufacturing, marketing, selling, and/or other activities necessary to the manufacture and distribution of our products, could result in substantial penalties, and/or have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
An adverse decision in a case such as this, or a judicial order preventing us or our suppliers and partners from manufacturing, marketing, selling, and/or other activities necessary to the manufacture and distribution of our products, could result in substantial penalties, and/or have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
These risks include, but are not limited to: • compliance with the national and local laws, regulations and customs of countries in which we do business, including, but not limited to, data privacy and protection, environmental and social regulations, import/export and enforcement of intellectual property rights; 27 Table of Contents • less established legal and regulatory regimes in certain jurisdictions, including China, where the interpretation and enforcement of laws, rules and regulations may involve uncertainties and can be inconsistent; • that litigation, administrative and court proceedings may be protracted, expensive and unpredictable; • that governments in certain jurisdictions may favor local businesses and make it more difficult for foreign businesses to operate on an equal footing, including but not limited to by promoting or requiring the local manufacture of pharmaceutical products and API or the establishment of local sites and offices; • increased uncertainties related to the enforcement of contracts with certain parties; • compliance with a variety of U.S. laws including, but not limited to, trade controls or sanctions, regulations put forth by the U.S.
These risks include, but are not limited to: • compliance with the national and local laws, regulations and customs of countries in which we do business, including, but not limited to, data privacy and protection, environmental and social regulations, import/export and enforcement of intellectual property rights; • less established legal and regulatory regimes in certain jurisdictions, including China, where the interpretation and enforcement of laws, rules and regulations may involve uncertainties and can be inconsistent; • litigation, administrative and court proceedings may be protracted, expensive and unpredictable; • governments in certain jurisdictions may favor local businesses and make it more difficult for foreign businesses to operate on an equal footing, including but not limited to by promoting or requiring the local manufacture of pharmaceutical products and API or the establishment of local sites and offices; • increased uncertainties related to the enforcement of contracts with certain parties; • compliance with a variety of U.S. laws including, but not limited to, trade controls or sanctions, regulations put forth by the U.S.
In some cases, such studies have resulted, and may in the future result, in the discontinuation or variation of product marketing authorizations or requirements for risk management programs, such as a patient registry. Any of these events could adversely affect our profitability, business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
In some cases, such studies have resulted, and may in the future result, in the discontinuation or variation of product marketing authorizations or requirements for risk management programs, such as a patient registry. Any of these events could adversely affect our profitability, business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
Further, any such interruption, security breach, or loss, misappropriation, and/or unauthorized access, use or disclosure of confidential information, including personal information regarding our patients and employees, could result in financial, legal, business, and reputational harm to us and could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
Further, any such interruption, security breach, or loss, misappropriation, and/or unauthorized access, use or disclosure of confidential information, including personal information regarding our patients and employees, could result in financial, legal, business, and reputational harm to us and could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
To the extent that we expend significant resources on R&D efforts and are not able, ultimately, to introduce successful new and/or complex or innovative products as a result of those efforts, there could be a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
To the extent that we expend significant resources on R&D efforts and are not able, ultimately, to introduce successful new and/or complex or innovative products as a result of those efforts, there could be a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
These factors could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price. We have a limited number of manufacturing facilities and certain third-party suppliers produce a substantial portion of our API and products, some of which require a highly exacting and complex manufacturing process.
These factors could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price. We have a limited number of manufacturing facilities and certain third-party suppliers produce a substantial portion of our API and products, some of which require a highly exacting and complex manufacturing process.
If we or one of our suppliers experience any of the problems described above, such problems could have a material adverse effect on our reputation, business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price. Our future success is highly dependent on our ability to attract, motivate and retain key personnel.
If we or one of our suppliers experience any of the problems described above, such problems could have a material adverse effect on our reputation, business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price. Our future success is highly dependent on our ability to attract, motivate and retain key personnel.
Failure to adapt to or comply with government regulations, regulatory requirements or investor or stakeholder expectations and standards could negatively impact our reputation, ability to do business with certain partners, access to investors and capital, and our stock price, and could lead to novel forms of litigation, including shareholder litigation and governmental investigations or enforcement actions related to environmental, social and governance matters.
Failure to adapt to or comply with government regulations, regulatory requirements or investor or stakeholder expectations and standards could negatively impact our reputation, ability to do business with certain partners, access to investors and capital, and our stock price, and could lead to novel forms of litigation, including shareholder litigation and governmental investigations or enforcement actions, sanctions or fines related to environmental, social and governance matters.
The occurrence of any of the above risks could have an adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price. A relatively small group of products may represent a significant portion of our revenues, net sales, gross profit, or net earnings from time to time.
The occurrence of any of the above risks could have an adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price. A relatively small group of products may represent a significant portion of our revenues, net sales, gross profit, or net earnings from time to time.
In addition, current or prospective Viatris employees may experience uncertainty about their future roles at the Company as a result of our strategic initiatives, acquisitions, divestitures, integration activities or restructuring program. As a result, we may lose key personnel or may be unable to attract, retain and motivate qualified individuals, or the associated costs may increase.
In addition, current or prospective Viatris employees may experience uncertainty about their future roles at the Company as a result of our strategic initiatives, acquisitions, divestitures, integration activities or restructuring programs. As a result, we may lose key personnel or may be unable to attract, retain and motivate qualified individuals, or the associated costs may increase.
These and other provisions of the Viatris Charter, the Viatris Bylaws and the DGCL could have the effect of delaying, deferring or preventing a proxy contest, tender offer, merger or other change in control, which may have a material adverse effect on Viatris’ business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
These and other provisions of the Viatris Charter, the Viatris Bylaws and the DGCL could have the effect of delaying, deferring or preventing a proxy contest, tender offer, merger or other change in control, which may have a material adverse effect on Viatris’ business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
If integration activities or restructuring programs are unsuccessful, if the estimated costs are higher than anticipated, or if we are unable to realize the anticipated synergies and other benefits, there could be a material adverse effect on Viatris’ business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
If integration activities or restructuring programs are unsuccessful, if the estimated costs are higher than anticipated, or if we are unable to realize the anticipated synergies and other benefits, there could be a material adverse effect on Viatris’ business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
If our employees or agents are found to have engaged in such practices, we could suffer severe criminal or civil penalties, reputational harm and other consequences that could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
If our employees or agents are found to have engaged in such practices, we could suffer severe criminal or civil penalties, reputational harm and other consequences that could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price. There are inherent uncertainties involved in estimates, judgments and assumptions used in the preparation of financial statements in accordance with U.S. GAAP.
Any of the foregoing could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price. There are inherent uncertainties involved in estimates, judgments and assumptions used in the preparation of financial statements in accordance with U.S. GAAP.
There can be no assurance that we will be able to achieve all of our intended goals or outlooks with respect to such strategies within the anticipated timeframes or at all, fully realize the expected benefits of any such transactions or arrangements, or successfully manage base business erosion or grow in future periods.
There can be no assurance that we will be able to achieve all of our intended goals or outlooks with respect to such strategies and priorities within the anticipated timeframes or at all, fully realize the expected benefits of any such transactions or arrangements, or successfully manage base business erosion or grow in future periods.
If we were to experience a significant reduction in or loss of business with one or more such customers, or if one or more such customers were to experience difficulty in paying us on a timely basis, our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price could be materially adversely affected.
If we were to experience a significant reduction in or loss of business with one or more such customers, or if one or more such customers were to experience difficulty in paying us on a timely basis, our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price could be materially adversely affected.
Loss of sales or revenues, as well as public loss of confidence in the integrity of pharmaceutical products as a result of counterfeiting, diversion, or theft could have a material adverse effect on our business, reputation, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
Loss of sales or revenues, as well as public loss of confidence in the integrity of pharmaceutical products as a result of counterfeiting, diversion, or theft could have a material adverse effect on our business, reputation, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
If we are unable to adequately protect our technology, trade secrets or proprietary know-how, or enforce our intellectual property rights, this could cause a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
If we are unable to adequately protect our technology, trade secrets or proprietary know-how, or enforce our intellectual property rights, this could cause a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
Moreover, if we obtain regulatory approval for a drug, it may be limited, for example, 34 Table of Contents with respect to the indicated uses and delivery methods for which the drug may be marketed, or may include warnings, precautions or contraindications in the labeling, which could restrict our potential market for the drug.
Moreover, if we obtain regulatory approval for a drug, it may be limited, for example, with respect to the indicated uses and delivery methods for which the drug may be marketed, or may include warnings, 33 Table of Contents precautions or contraindications in the labeling, which could restrict our potential market for the drug.
If we are unable to, or choose not to, pay a quarterly dividend or repurchase shares under our stock buyback program, this may have a negative impact on the perception of the Company as an investment opportunity by shareholders or investment analysts, which may in turn negatively impact our stock price.
If we are unable to, or choose not to, pay a quarterly dividend or repurchase shares under our share repurchase program, this may have a negative impact on the perception of the Company as an investment opportunity by shareholders or investment analysts, which may in turn negatively impact our stock price.
This summary is not exhaustive and is qualified by reference to the full set of risk factors set forth in this Part I, Item 1A. • Strategic Risks ◦ We may not realize the intended benefits of, or achieve the intended goals or outlooks with respect to, our strategic initiatives, including divestitures, acquisitions or other potential transactions. ◦ There are risks and uncertainties associated with the Announced Divestitures, including the OTC Transaction, one or more of which could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or stock price. ◦ The integration of acquired businesses as well as restructuring programs have presented and may in the future present significant challenges. ◦ There are ongoing risks and uncertainties associated with the Biocon Biologics Transaction, one or more of which could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or stock price. ◦ We have and may continue to experience pressure on the pricing of and reimbursements for certain of our products due to pricing controls, social or government pressure to lower the cost of drugs, and consolidation across the supply chain. ◦ We have significant operations globally, which exposes us to the risks inherent in conducting our business internationally. ◦ Charges to earnings resulting from acquisitions could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price. • Operational Risks ◦ Current and changing economic conditions, including inflation, may adversely affect our industry, business, partners and suppliers. ◦ The pharmaceutical industry is heavily regulated, and we face significant costs and uncertainties associated with our efforts to comply with applicable laws and regulations. ◦ The use of legal, regulatory, and legislative strategies by both brand and generic competitors, including but not limited to “authorized generics” and regulatory petitions, may increase costs associated with the introduction or marketing of our generic products, could delay or prevent such introduction, and could significantly reduce our revenue and profit. ◦ If we are unable to successfully introduce new products in a timely manner, our future revenue and profitability may be adversely affected. ◦ We expend a significant amount of resources on R&D efforts that may not lead to successful product introductions. ◦ Even if our products in development receive regulatory approval, such products may not achieve expected levels of market acceptance. ◦ Our business is highly dependent upon market perceptions of us, our products and brands, and the safety and quality of our products and brands, as well as the effectiveness of our sales and marketing activities, and we may be adversely impacted by negative publicity or findings. ◦ We have a limited number of manufacturing facilities and certain third-party suppliers produce a substantial portion of our API and products, some of which require a highly exacting and complex manufacturing process. ◦ Our future success is highly dependent on our ability to attract, motivate and retain key personnel. 21 Table of Contents • Compliance Risks ◦ We are subject to the U.S.
This summary is not exhaustive and is qualified by reference to the full set of risk factors set forth in this Part I, Item 1A. • Strategic Risks ◦ We may not realize the intended benefits of, or achieve the intended goals or outlooks with respect to, our strategic initiatives and priorities, including divestitures, acquisitions or other potential transactions. ◦ There are ongoing risks and uncertainties associated with our recent divestitures, one or more of which could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price. ◦ The integration of acquired businesses as well as restructuring programs have presented and may in the future present significant challenges. ◦ We have and may continue to experience pressure on the pricing of and reimbursements for certain of our products due to pricing controls, social or government pressure to lower the cost of drugs, and consolidation across the supply chain. ◦ We have significant operations globally, which exposes us to the risks inherent in conducting our business internationally. ◦ Charges to earnings resulting from acquisitions could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price. • Operational Risks ◦ Current and changing economic conditions, including inflation, may adversely affect our industry, business, partners and suppliers. ◦ The pharmaceutical industry is heavily regulated, and we face significant costs and uncertainties associated with our efforts to comply with applicable laws and regulations. ◦ The use of legal, regulatory, and legislative strategies by both brand and generic competitors, including but not limited to “authorized generics” and regulatory petitions, may increase costs associated with the introduction or marketing of our generic products, could delay or prevent such introduction, and could significantly reduce our revenue and profit. ◦ If we are unable to successfully introduce new products in a timely manner, our future revenue and profitability may be adversely affected. ◦ We expend a significant amount of resources on R&D efforts that may not lead to successful product introductions. ◦ Even if our products in development receive regulatory approval, such products may not achieve expected levels of market acceptance. ◦ Our business is highly dependent upon market perceptions of us, our products and brands, and the safety and quality of our products and brands, as well as the effectiveness of our sales and marketing activities, and we may be adversely impacted by negative publicity or findings. ◦ We have a limited number of manufacturing facilities and certain third-party suppliers produce a substantial portion of our API and products, some of which require a highly exacting and complex manufacturing process. ◦ Our future success is highly dependent on our ability to attract, motivate and retain key personnel. • Compliance Risks ◦ We are subject to the U.S.
Sales of a limited number of our products from time to time represent a significant portion of our revenues, net sales, gross profit, and net earnings. For each of the years ended December 31, 2023 and 2022, Viatris’ top ten products in terms of sales, in the aggregate, represented approximately 33% of the Company’s net sales.
Sales of a limited number of our products from time to time represent a significant portion of our revenues, net sales, gross profit, and net earnings. For each of the years ended December 31, 2024 and 2023, Viatris’ top ten products in terms of sales, in the aggregate, represented approximately 33% of the Company’s net sales.
If any of these legal proceedings or inquiries were to result in an adverse outcome, the impact could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
If any of these legal proceedings or inquiries were to result in an adverse outcome, the impact could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
Our business, financial condition, results of operations, cash flows, ability to pay dividends, and/or stock price could be materially affected by any of these risks, if they occur, or by other factors not currently known to us, or not currently considered to be material.
Our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price could be materially affected by any of these risks, if they occur, or by other factors not currently known to us, or not currently considered to be material.
To the extent that a loss occurs, depending on the nature of the loss and the level of insurance coverage maintained, it could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
To the extent that a loss occurs, depending on the nature of the loss and the level of insurance coverage maintained, it could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
These factors could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price. If we incur additional debt, the risks described above could intensify.
These factors could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price. If we incur additional debt, the risks described above could intensify.
Any such changes could result in corresponding changes to the amounts of liabilities, revenues, expenses and income and could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
Any such changes could result in corresponding changes to the amounts of liabilities, revenues, expenses and income and could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
If we are unsuccessful in retaining our key employees or enforcing certain post-employment contractual provisions such as confidentiality provisions, it may have a material adverse impact on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price. Compliance Risks We are subject to the U.S. Foreign Corrupt Practices Act, the U.K.
If we are unsuccessful in retaining our key employees or enforcing certain post-employment contractual provisions such as confidentiality provisions, it may have a material adverse impact on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price. Compliance Risks We are subject to the U.S. Foreign Corrupt Practices Act, U.S.
Currency fluctuations and changes in exchange rates have impacted and could continue to adversely affect our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price. Although we report our financial results in U.S.
Currency fluctuations and changes in exchange rates have impacted and could continue to adversely affect our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price. Although we report our financial results in U.S.
Charges to earnings resulting from acquisitions could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price . Under U.S.
Charges to earnings resulting from acquisitions could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price . Under U.S.
As the legislative and regulatory landscape for data privacy and security continues to evolve around the world, there has been an increasing focus on data privacy and security matters that may affect our business. In the U.S., federal laws include HIPAA, which governs the use, disclosure, and security of protected health information by HIPAA covered entities and business associates.
As the legislative and regulatory landscape for data privacy and security continues to evolve around the world, there has been an increasing focus on data privacy and security matters that may affect our business. 41 Table of Contents In the U.S., federal laws include HIPAA, which governs the use, disclosure, and security of protected health information by HIPAA covered entities and business associates.
The occurrence of any one or more of the above risks could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
The occurrence of any one or more of the above risks could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
The substantial unexpected costs we may incur could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
The substantial unexpected costs we may incur could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
If we or our third-party suppliers’ face significant manufacturing issues, this could lead to shutdowns, delays or product shortages, or to our being entirely unable to supply certain products to customers for an extended period of time.
If we or our third-party suppliers face significant manufacturing issues, this could lead to shutdowns, delays or product shortages, or to our being entirely unable to supply certain products to customers for an extended period of time.
Such impairments or losses have in the past and could in the future materially affect Viatris’ reported net earnings, business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
Such impairments or losses have in the past and could in the future materially affect Viatris’ reported net earnings, business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
The occurrence of any of the above risks could have a material adverse effect on our industry, business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
The occurrence of any of the above risks could have a material adverse effect on our industry, business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
The occurrence of any of the above risks could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
The occurrence of any of the above risks could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
In addition, regulations intended to limit greenhouse gas emissions or water usage, such as greenhouse gas emission reduction obligations, carbon pricing, and taxes on emissions, fuel and energy, or to mitigate the impacts of climate change may become more prevalent, which could increase our operating costs and the costs charged by suppliers.
In addition, regulations intended to limit greenhouse gas emissions or water usage, such as greenhouse gas emission reduction obligations, carbon pricing, and taxes on emissions, fuel and energy, or to mitigate the 43 Table of Contents impacts of climate change may become more prevalent, which could increase our operating costs and the costs charged by suppliers.
Our competitors may be able to develop products and processes competitive with or superior to our own for many reasons, including but not limited to the possibility that they may have: • proprietary processes or delivery systems; • larger or more productive R&D and marketing staff; • larger or more efficient production capabilities in a particular therapeutic area; • more experience in preclinical testing and human clinical trials; • more products; • more experience in developing new drugs; or • greater financial resources.
Our competitors may be able to develop products and processes competitive with or superior to our own for many reasons, including but not limited to the possibility that they may have: • proprietary processes or delivery systems; • larger or more productive R&D and marketing staff; • larger or more efficient production capabilities in a particular therapeutic area; • more experience in preclinical testing and human clinical trials; • more products; 28 Table of Contents • more experience in developing new drugs; or • greater financial resources.
In addition, Viatris has agreed to pay Pfizer an amount equal to 57% of any losses actually incurred or suffered by Viatris, its predecessors or subsidiaries, since July 29, 2019, arising out of third-party actions relating to the manufacture, distribution, marketing, promotion or sale of opioids by 40 Table of Contents or on behalf of Viatris, its predecessors or subsidiaries.
In addition, Viatris has agreed to pay Pfizer an amount equal to 57% of any losses actually incurred or suffered by Viatris, its predecessors or subsidiaries, since July 29, 2019, arising out of third-party actions relating to the manufacture, distribution, marketing, promotion or sale of opioids by or on behalf of Viatris, its predecessors or subsidiaries.
If global credit markets contract, future debt financing may not be available to us when required or may not be available on acceptable terms or at all, and as a result we may 46 Table of Contents be unable to grow our business, take advantage of business opportunities, respond to competitive pressures or satisfy our obligations under our indebtedness.
If global credit markets contract, future debt financing may not be available to us when required or may not be available on acceptable terms or at all, and as a result we may be unable to grow our business, take advantage of business opportunities, respond to competitive pressures or satisfy our obligations under our indebtedness.
Many markets in which we operate have implemented or may implement tender systems for generic pharmaceuticals in an effort to lower prices. Under such tender systems, manufacturers submit bids which establish prices for generic pharmaceutical products. Upon winning the tender, the winning company will receive a preferential reimbursement for a period of time.
Many markets in which we operate have implemented or may implement tender systems for generic pharmaceuticals in an effort to lower prices. Under such tender systems, manufacturers submit bids which establish prices for generic pharmaceutical products. Upon winning the tender, the winning company will receive a preferential reimbursement for a period 24 Table of Contents of time.
If the volume or pricing of our largest selling products declines in the future, our business, financial condition, results of operations, cash flows, and/or share price could be materially adversely affected. Operational Risks Current and changing economic conditions, including inflation, may adversely affect our industry, business, partners and suppliers.
If the volume or pricing of our largest selling products declines in the future, our business, financial condition, results of operations, cash flows, and/or share price could be materially adversely affected. 29 Table of Contents Operational Risks Current and changing economic conditions, including inflation, may adversely affect our industry, business, partners and suppliers.
The preparation of financial statements in accordance with U.S. GAAP involves making estimates, judgments and assumptions that affect reported amounts of assets, liabilities, revenues, expenses and income. Estimates, judgments and assumptions are inherently subject to change in the future and any necessary revisions to prior estimates, judgments or assumptions could lead to a restatement.
The preparation of financial statements in accordance with U.S. GAAP involves making estimates, judgments and assumptions that affect reported amounts of assets, liabilities, revenues, expenses 46 Table of Contents and income. Estimates, judgments and assumptions are inherently subject to change in the future and any necessary revisions to prior estimates, judgments or assumptions could lead to a restatement.
The Viatris Charter provides that unless Viatris, through approval of the Viatris Board, otherwise consents in writing, the Court of Chancery of the State of Delaware or, if and only if the Court of Chancery of the State of Delaware dismisses such action for lack of subject matter jurisdiction, another state court sitting in the State of Delaware (or, if no state court located within the State of Delaware has jurisdiction, the federal district court for the District of Delaware), will be the sole and exclusive forum for any derivative action or proceeding brought on behalf of Viatris, any action or proceeding asserting a claim of breach of a fiduciary duty owed by any director or officer or other employees of Viatris to Viatris or its stockholders, creditors or other constituents, any action asserting a claim against Viatris or any of its directors, officers or other employees arising pursuant to, or seeking to enforce any right, obligation or remedy under, any provision of the DGCL or the Viatris Charter or the Viatris Bylaws, as each may be amended from time to time, any action or proceeding asserting a claim against Viatris or any of its directors, officers or other employees governed by the internal affairs doctrine or any action or proceeding as to which the DGCL (as it may be amended from time to time) confers jurisdiction on the Court of Chancery of the State of Delaware.
The exclusive forum provisions in the Viatris Charter could discourage lawsuits against Viatris and its directors and officers. 48 Table of Contents The Viatris Charter provides that unless Viatris, through approval of the Viatris Board, otherwise consents in writing, the Court of Chancery of the State of Delaware or, if and only if the Court of Chancery of the State of Delaware dismisses such action for lack of subject matter jurisdiction, another state court sitting in the State of Delaware (or, if no state court located within the State of Delaware has jurisdiction, the federal district court for the District of Delaware), will be the sole and exclusive forum for any derivative action or proceeding brought on behalf of Viatris, any action or proceeding asserting a claim of breach of a fiduciary duty owed by any director or officer or other employees of Viatris to Viatris or its stockholders, creditors or other constituents, any action asserting a claim against Viatris or any of its directors, officers or other employees arising pursuant to, or seeking to enforce any right, obligation or remedy under, any provision of the DGCL or the Viatris Charter or the Viatris Bylaws, as each may be amended from time to time, any action or proceeding asserting a claim against Viatris or any of its directors, officers or other employees governed by the internal affairs doctrine or any action or proceeding as to which the DGCL (as it may be amended from time to time) confers jurisdiction on the Court of Chancery of the State of Delaware.
For the years ended December 31, 2023 and 2022, Viatris’ top three customers in terms of net sales, in the aggregate, represented approximately 25% and 26%, respectively, of the Company’s consolidated total net sales.
For the years ended December 31, 2024 and 2023, Viatris’ top three customers in terms of net sales, in the aggregate, represented approximately 26% and 25%, respectively, of the Company’s consolidated total net sales.
Given our dependence on market perception and sales and marketing efforts, negative publicity associated with product or brand quality, patient illness, or other adverse effects resulting from, or perceived to be resulting from, our products or brands, or our partners’ and suppliers’ manufacturing facilities, or an inability to increase or maintain the effectiveness and 36 Table of Contents efficiency of our sales and marketing activities could have a material adverse effect on our reputation, business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
Given our dependence on market perception and sales and marketing efforts, negative publicity associated with product or brand quality, patient illness, or other adverse effects resulting from, or perceived to be resulting from, our products or brands, or our partners’ and suppliers’ manufacturing facilities, or an inability to increase or maintain the effectiveness and efficiency of our sales and marketing activities could have a material adverse effect on our reputation, business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
Our actual effective tax rate may vary from our expectation and that variance may be material. For example, in 2022 the U.S. Inflation Reduction Act was signed into law which, among other things, provides for a corporate alternative minimum tax of 15% beginning in 2023 on adjusted financial statement income and an excise tax of 1% on corporate stock repurchases.
Our actual effective tax rate may vary from our expectation and that variance may be material. For example, in 2022 the U.S. Inflation Reduction Act was signed into law which, among other things, provides for a corporate alternative minimum tax of 15% on adjusted financial statement income and an excise tax of 1% on corporate share repurchases.
Other countries in which we operate have, or are developing, laws and regulations governing the collection, use, securing and transmission of personal information as well that may affect our business or require us to adapt our technologies or 42 Table of Contents practices.
Other countries in which we operate have, or are developing, laws and regulations governing the collection, use, securing and transmission of personal information as well that may affect our business or require us to adapt our technologies or practices.
Companies are facing increasing expectations and scrutiny from customers, regulators, governments, investors, lenders, employees and other stakeholders related to their environmental, social and governance practices and disclosure.
Companies are facing increasing expectations and scrutiny from customers, regulators, governments, investors, lenders, employees and other stakeholders related to their environmental, social and governance practices and disclosures.
See also “ The pharmaceutical industry is heavily regulated, and we face significant costs and uncertainties associated with our efforts to comply with applicable laws and regulations.” We purchase certain API and other materials and supplies that we use in our manufacturing operations, as well as certain finished products, from many different foreign and domestic suppliers.
See also “ The pharmaceutical industry is heavily regulated, and we face significant costs and uncertainties associated with our efforts to comply with applicable laws and regulations.” 36 Table of Contents We purchase certain API and other materials and supplies that we use in our manufacturing operations, as well as certain finished products, from many different foreign and domestic suppliers.
Certain divestitures also have resulted and may in the future result in continued financial and operational exposure to the divested assets or businesses, such as through guarantees or other financial arrangements, indemnification, continued supply and transition services obligations to the divested businesses, stranded costs, or potential litigation.
These divestitures have resulted and may in the future result in continued financial and operational exposure to the divested assets or businesses, such as through guarantees or other financial arrangements, indemnification, continued supply and transition services obligations to the divested businesses, stranded costs, or potential litigation.
Other factors, including changes in tax or securities laws, such as the U.S. Inflation Reduction Act of 2022 which imposes a corporate excise tax of 1% on net stock repurchases beginning in 2023, could also impact our stock repurchases.
Other factors, including changes in tax or securities laws, such as the U.S. Inflation Reduction Act of 2022 which imposes a corporate excise tax of 1% on net stock repurchases, could also impact our share repurchases.

… 197 more changes not shown on this page.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

17 edited+0 added−1 removed9 unchanged
Biggest changeThe Company’s Chief Information Security Officer & Head of Global Security, under the direction of the Company’s Chief Compliance Officer, reports quarterly to the Risk Management Team, which includes the CEO, President, CFO, General Counsel, Chief Human Relations Officer, Head of Corporate Affairs, Regional Presidents, Chief Information Officer and Chief Compliance Officer, and the Viatris Board on the progress of the information security program and overall security status.
Biggest changeThe Company’s Chief Information Security Officer & Head of Global Security, under the direction of the Company’s Chief Compliance Officer, reports quarterly to an internal risk committee of senior management, which includes the CEO, CFO, Chief Legal Officer, Chief People Officer, Chief Corporate Affairs Officer, Chief Information Officer, Chief Compliance Officer, Chief Quality Officer, Chief Supply Officer, Chief R&D Officer and Regional Presidents, as well as the Viatris Board on the progress of the information security program and overall security status.
ITEM 2. Properties For information regarding properties, refer to Item 1 “Business” in Part I of this Form 10-K. ITEM 3. Legal Proceedings For information regarding legal proceedings, refer to Note 19 Litigation included in Item 8 in Part II of this 10-K.
ITEM 2. Properties For information regarding properties, refer to Item 1 “Business” in Part I of this Form 10-K. ITEM 3. Legal Proceedings For information regarding legal proceedings, refer to Note 19 Litigation included in Part II, Item 8 of this 10-K.
In the event of a severe cybersecurity incident, such as a ransomware attack or other incident that has a severe adverse effect on Viatris’ operations, critical systems or sensitive data, or which may cause severe reputational damage, executive management may determine that is necessary to notify the Viatris Board or the Compliance and Risk Oversight Committee about such a cybersecurity incident immediately.
In the event of a severe cybersecurity incident, such as a ransomware attack or other incident that has a severe adverse effect on Viatris’ operations, critical systems or sensitive data, or which may cause severe reputational damage, executive management may determine that it is necessary to notify the Viatris Board or the Compliance and Risk Oversight Committee about such a cybersecurity incident immediately.
The Viatris IT team, led by the Chief Information Officer, is responsible for ongoing security operations such as maintaining firewalls and patch management. In addition, the delivery of many information security programs relies on IT resources to execute the delivery and implementation of security solutions, such as end-point protection and end-of-life protocols.
The Viatris IT team, led by the Chief Information Officer, is responsible for ongoing security operations such as maintaining firewalls and patch management. In addition, the delivery of many information security programs relies on IT resources to execute the selection, delivery and implementation of security solutions, such as end-point protection and end-of-life protocols.
With respect to IT and cybersecurity risks, Viatris maintains an information security program that is aligned with the National Institute of Standards and Technology Cybersecurity Framework standards, and which is designed to identify, protect, detect, respond to and recover from cybersecurity threats.
With respect to IT and cybersecurity risks, Viatris maintains an information security program that is aligned with the National Institute of Standards and Technology Cybersecurity Framework, and which is designed to govern, identify, protect, detect, respond to and recover from cybersecurity threats.
The CIRP is managed by the information security team and is reviewed at least annually. Viatris tests the CIRP through technical exercises at least semi-annually, reviews the CIRP with executive management annually, and periodically conducts executive tabletop exercises/scenarios.
The CIRP is managed by the Viatris global information security team and is reviewed at least annually. Viatris tests the CIRP through technical exercises semi-annually, reviews the CIRP with executive management annually, and periodically conducts executive tabletop exercises/scenarios.
The full Viatris Board receives a report on the respective quarterly discussions from the Chair of the Compliance and Risk Oversight Committee each quarter. We and our suppliers, partners, customers and vendors have in the past and will likely continue to experience cybersecurity threats and incidents, including attacks on and compromises of our systems.
The full Viatris Board receives a report on the respective quarterly discussions from the Chair of the Compliance and Risk Oversight Committee each quarter. We and our suppliers, partners, customers and vendors have in the past experienced and will in the future likely continue to experience cybersecurity threats and incidents, including attacks on and compromises of our systems.
For additional information regarding how cybersecurity threats are reasonably likely to materially affect our business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price, see Part I, Item 1A “Risk Factors – “ We are increasingly dependent on IT and our systems and infrastructure face certain risks, including cybersecurity and data leakage risks.” of this Form 10-K.
For additional information regarding how cybersecurity threats are reasonably likely to materially affect our business, financial condition, results of operations, cash flows, ability to pay dividends, repurchase shares, and/or stock price, see Part I, Item 1A Risk Factors – “ We are increasingly dependent on IT and information systems and our systems and infrastructure face certain risks, including cybersecurity and data leakage risks.” of this Form 10-K.
Key aspects of the information security program are also provided by third-party managed security providers, including but not limited to first- and second-line support for incident response and the Company’s vulnerability assessment process. Our suppliers, subcontractors and third-party service providers, including third-party managed security providers, are subject to cybersecurity obligations and controls.
Key aspects of the information security program are also provided by third-party managed security providers, including first- and second-line support for incident response and the Company’s vulnerability assessment process. Our suppliers, subcontractors and third-party service providers, including third-party managed security providers, are subject to cybersecurity obligations and controls.
We conduct initial risk assessments of third-party suppliers and service providers based on various factors and then review and monitor these third-party suppliers and service providers based on their relative assessed level of risk. We also require our suppliers, subcontractors and third-party service providers to agree to cybersecurity-related contractual terms and conditions of purchase.
We conduct initial risk assessments of third-party suppliers and service providers based 50 Table of Contents on various factors and then review and monitor these third-party suppliers and service providers based on their relative assessed level of risk. We also require our suppliers, subcontractors and third-party service providers to agree to cybersecurity-related contractual terms and conditions of purchase.
Our internal audit function coordinates cross functionally to periodically complete the Company’s enterprise risk assessment, including the identification of key and emerging risks, and reviews and refreshes this analysis quarterly with executive management.
Our internal audit function coordinates cross functionally to maintain the Company’s enterprise risk assessment, including the identification of key and emerging risks, and reviews and refreshes this analysis quarterly with executive management.
Viatris’ current Chief Information Security Officer & Head of Global Security has over 20 years of experience in information security within the pharmaceutical industry.
Viatris’ current Chief Information Security Officer & Head of Global Security has over 25 years of experience in information security within the pharmaceutical industry.
As part of this program, Viatris has adopted a Cybersecurity Incident Response Plan (referred to as CIRP) to establish a guide for Viatris’ leadership and incident response stakeholders through an “incident” (a single event or a set of anomalous and adverse “events” (for purposes of the CIRP, a change in a system or technology device that could impact the confidentiality, integrity, and availability of Viatris’ data and technology assets) caused by malicious intent or by accident impacting Viatris’ network, computing systems, or digital information).
As part of its information security program, Viatris has adopted a Cybersecurity Incident Response Plan (CIRP) to establish a guide for Viatris’ leadership and incident response stakeholders through an “incident” – a single event or a set of anomalous and adverse “events” or, for purposes of the CIRP, a change in a system, technology device or environment that could impact the confidentiality, integrity, availability or safety of Viatris’ data, employees or assets, caused by malicious intent or accident and impacting Viatris’ network, computing systems, digital information, employees or assets.
The CIRT is generally responsible for determining the potential impacts to the Company, including severity, notifying appropriate parties pursuant to the CIRP and determining whether to engage a third-party incident response vendor, among other responsibilities. Critical and high severity incidents require the engagement of the senior leadership once such an incident is confirmed.
The CIRT is responsible for determining the potential impacts to the Company, including severity, notifying appropriate parties pursuant to the CIRP and determining whether to engage a third-party incident response vendor, among other responsibilities. Critical incidents require implementation of the global crisis plan and high severity incidents require notification to the executive leadership team once such an incident is confirmed.
For each key or emerging risk identified, the Company establishes risk monitoring ownership, evaluating risk mitigation opportunities and collecting quarterly updates for executive management and the Viatris Board’s Compliance and Risk Oversight Committee.
For each key or emerging risk identified, the Company establishes risk monitoring ownership, from which quarterly updates are collected for executive management and the Viatris Board’s Compliance and Risk Oversight Committee.
The Company participates in several industry and third-party threat monitoring and information-sharing services, and these engagements provide insight into vulnerabilities and threats which are incorporated into the security operations scanning 50 Table of Contents as well as shared with the IT team for remediation.
The Company participates in several industry and third-party threat monitoring and information-sharing services, and these engagements provide insight into vulnerabilities and threats which are incorporated into the security operations and IT remediation.
The severity of the incident guides the determination of the parties to whom the incident will be escalated, and the Company may decide to seek assistance from a third-party incident response vendor.
The severity of the incident guides the determination of the parties to whom the incident will be escalated, and the Company may decide to seek assistance from a third-party incident response vendor. Viatris’ Cybersecurity Incident Response Team (CIRT) reports to the Chief Information Security Officer & Head of Global Security and has the role of investigating and executing incident protocols.
Removed
Viatris’ Cybersecurity Incident Response Team (referred to as CIRT) reports to the Chief Information Security Officer & Head of Global Security and has the role of investigating and executing incident protocols.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

1 edited+0 added−0 removed0 unchanged
Biggest changeITEM 3. Legal Proceedings 51 ITEM 4. Mine Safety Disclosures 51 PART II ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 52 ITEM 6. [Reserved] 53 ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 54 ITEM 7A. Quantitative and Qualitative Disclosures about Market Risk 77 ITEM 8.
Biggest changeITEM 3. Legal Proceedings 51 ITEM 4. Mine Safety Disclosures 51 PART II ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 52 ITEM 6. [Reserved] 53 ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 54 ITEM 7A. Quantitative and Qualitative Disclosures about Market Risk 76 ITEM 8.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

6 edited+0 added−1 removed2 unchanged
Biggest changeThe graph tracks the performance of a $100 investment in our common stock and in each index (with the reinvestment of all dividends) from November 16, 2020 to December 31, 2023. The historical share price data has been revised to reflect updated source information. The revisions are not significant to previously reported amounts.
Biggest changeThe graph tracks the performance of a $100 investment in our common stock and in each index (with the reinvestment of all dividends) from November 16, 2020 to December 31, 2024.
November 16, 2020 December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 Viatris Inc. 100.00 119.67 88.40 75.78 77.34 S&P 500 100.00 115.21 148.28 121.43 153.35 Dow Jones U.S. Pharmaceuticals 100.00 104.70 130.85 141.10 141.08
November 16, 2020 December 31, 2020 December 31, 2021 December 31, 2022 December 31, 2023 December 31, 2024 Viatris Inc. 100.00 119.67 88.40 75.78 77.34 92.55 S&P 500 100.00 115.21 148.28 121.43 153.35 191.72 Dow Jones U.S. Pharmaceuticals 100.00 104.70 130.85 141.10 141.08 152.31
On February 26, 2024, the Company’s Board of Directors declared a quarterly cash dividend of $0.12 per share on the Company’s issued and outstanding common stock, which will be payable on March 18, 2024 to shareholders of record as of the close of business on March 11, 2024.
On February 24, 2025, the Company’s Board of Directors declared a quarterly cash dividend of $0.12 per share on the Company’s issued and outstanding common stock, which will be payable on March 18, 2025 to shareholders of record as of the close of business on March 10, 2025.
ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the NASDAQ Stock Market under the symbol “VTRS”. As of February 22, 2024, there were approximately 103,200 holders of record of shares of Viatris common stock.
ITEM 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities Our common stock is traded on the NASDAQ Stock Market under the symbol “VTRS”. As of February 21, 2025, there were approximately 95,287 holders of record of shares of Viatris common stock.
The Company paid quarterly cash dividends of $0.12 per share on the Company’s issued and outstanding common stock on March 16, 2022, June 16, 2022, September 16, 2022 and December 16, 2022.
The Company paid quarterly cash dividends of $0.12 per share on the Company’s issued and outstanding common stock on March 18, 2024, June 14, 2024, September 13, 2024 and December 13, 2024.
The Company paid quarterly cash dividends of $0.11 per share on the Company’s issued and outstanding common stock on June 16, 2021, September 16, 2021 and December 16, 2021. 52 Table of Contents STOCK PERFORMANCE GRAPH Viatris common stock has been listed on the NASDAQ under the symbol “VTRS” since November 17, 2020.
The Company also paid quarterly cash dividends of $0.12 per share on the Company’s issued and outstanding common stock in each of the four quarters of 2023 and 2022. 52 Table of Contents STOCK PERFORMANCE GRAPH Viatris common stock has been listed on the NASDAQ under the symbol “VTRS” since November 17, 2020.
Removed
The Company paid quarterly cash dividends of $0.12 per share on the Company’s issued and outstanding common stock on March 17, 2023, June 16, 2023, September 15, 2023 and December 15, 2023.

Item 7. Management's Discussion & Analysis

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

159 edited+44 added−47 removed82 unchanged
Biggest changeFactors that could cause or contribute to such differences include, but are not limited to: • the possibility that the Company may not realize the intended benefits of, or achieve the intended goals or outlooks with respect to, its strategic initiatives (including divestitures, acquisitions, or other potential transactions) or move up the value chain by focusing on more complex and innovative products to build a more durable higher margin portfolio; • the possibility that the Company may be unable to achieve intended or expected benefits, goals, outlooks, synergies, growth opportunities and operating efficiencies in connection with divestitures, acquisitions, other transactions, or restructuring programs, within the expected timeframes or at all; • with respect to previously announced divestitures that have not been consummated, including the divestiture of substantially all of our OTC Business, such divestitures not being completed on the expected timelines or at all and the risk that the conditions set forth in the definitive agreements with respect to such divestitures will not be satisfied or waived; • with respect to previously announced divestitures, failure to realize the total transaction values for the divestitures and/or the expected proceeds for any or all such divestitures, including as a result of any purchase price adjustment or a failure to achieve any conditions to the payment of any contingent consideration; • goodwill or impairment charges or other losses related to the divestiture or sale of businesses or assets (including but not limited to announced divestitures that have not yet been consummated); • the Company’s failure to achieve expected or targeted future financial and operating performance and results; • the potential impact of public health outbreaks, epidemics and pandemics; • actions and decisions of healthcare and pharmaceutical regulators; • changes in relevant laws, regulations and policies and/or the application or implementation thereof, including but not limited to tax, healthcare and pharmaceutical laws, regulations and policies globally (including the impact of recent and potential tax reform in the U.S. and pharmaceutical product pricing policies in China); • the ability to attract, motivate and retain key personnel; • the Company’s liquidity, capital resources and ability to obtain financing; • any regulatory, legal or other impediments to the Company’s ability to bring new products to market, including but not limited to “at-risk launches”; • success of clinical trials and the Company’s or its partners’ ability to execute on new product opportunities and develop, manufacture and commercialize products; • any changes in or difficulties with the Company’s manufacturing facilities, including with respect to inspections, remediation and restructuring activities, supply chain or inventory or the ability to meet anticipated demand; • the scope, timing and outcome of any ongoing legal proceedings, including government inquiries or investigations, and the impact of any such proceedings on the Company; • any significant breach of data security or data privacy or disruptions to our IT systems; • risks associated with having significant operations globally; • the ability to protect intellectual property and preserve intellectual property rights; • changes in third-party relationships; 54 Table of Contents • the effect of any changes in the Company’s or its partners’ customer and supplier relationships and customer purchasing patterns, including customer loss and business disruption being greater than expected following an acquisition or divestiture; • the impacts of competition, including decreases in sales or revenues as a result of the loss of market exclusivity for certain products; • changes in the economic and financial conditions of the Company or its partners; • uncertainties regarding future demand, pricing and reimbursement for the Company’s products; • uncertainties and matters beyond the control of management, including but not limited to general political and economic conditions, inflation rates and global exchange rates; and • inherent uncertainties involved in the estimates and judgments used in the preparation of financial statements, and the providing of estimates of financial measures, in accordance with U.S.
Biggest changeFactors that could cause or contribute to such differences include, but are not limited to: • the possibility that the Company may not realize the intended benefits of, or achieve the intended goals or outlooks with respect to, its strategic initiatives and priorities (including divestitures, acquisitions, strategic alliances, collaborations, or other potential transactions) or accelerate its growth by building on the strength of its base business with an expanding portfolio of innovative, best-in-class, patent-protected assets; • the possibility that the Company may be unable to achieve intended or expected benefits, goals, outlooks, synergies, growth opportunities and operating efficiencies in connection with divestitures, acquisitions, strategic alliances, collaborations, or other transactions, or restructuring programs, within the expected timeframes or at all; • the ongoing risks and uncertainties associated with our recent divestitures; • goodwill or impairment charges or other losses; • the Company’s failure to achieve expected or targeted future financial and operating performance and results; • the potential impact of natural or man-made disasters, public health outbreaks, epidemics, pandemics, or social disruption in regions where we or our partners or suppliers operate; • actions and decisions of healthcare and pharmaceutical regulators; • changes in relevant laws, regulations and policies and/or the application or implementation thereof, including but not limited to tax, healthcare and pharmaceutical laws, regulations and policies globally; • the ability to attract, motivate and retain key personnel; • the Company’s liquidity, capital resources and ability to obtain financing; • any regulatory, legal or other impediments to the Company’s ability to bring new products to market, including but not limited to “at-risk launches”; • success of clinical trials and the Company’s or its partners’ ability to execute on new product opportunities and develop, manufacture and commercialize products; • any changes in or difficulties with the Company’s manufacturing facilities, including with respect to inspections, remediation and restructuring activities, supply chain or inventory or the ability to meet anticipated demand; • the scope, timing and outcome of any ongoing legal proceedings, including government inquiries or investigations, and the impact of any such proceedings on the Company; • any significant breach of data security or data privacy or disruptions to our IT systems; • risks associated with having significant operations globally; • the ability to protect intellectual property and preserve intellectual property rights; • changes in third-party relationships; • the effect of any changes in the Company’s or its partners’ customer and supplier relationships and customer purchasing patterns, including customer loss and business disruption being greater than expected following an adverse regulatory action, acquisition or divestiture; • the impacts of competition, including decreases in sales or revenues as a result of the loss of market exclusivity for certain products; • changes in the economic and financial conditions of the Company or its partners; • uncertainties regarding future demand, pricing and reimbursement for the Company’s products; 54 Table of Contents • uncertainties and matters beyond the control of management, including but not limited to general political and economic conditions, tariffs and trade policies, inflation rates and global exchange rates; and • inherent uncertainties involved in the estimates and judgments used in the preparation of financial statements, and the providing of estimates of financial measures, in accordance with U.S.
Net cash provided by operating activities is derived from net earnings (loss) adjusted for non-cash operating items, gains and losses attributed to investing and financing activities and changes in operating assets and liabilities resulting from timing differences between the receipts and payments of cash, including changes in cash primarily reflecting the timing of cash collections from customers, payments to vendors and employees and tax payments in the ordinary course of business.
Net cash provided by operating activities is derived from net (loss) earnings adjusted for non-cash operating items, gains and losses attributed to investing and financing activities and changes in operating assets and liabilities resulting from timing differences between the receipts and payments of cash, including changes in cash primarily reflecting the timing of cash collections from customers, payments to vendors and employees and tax payments in the ordinary course of business.
Fair Value Adjustments, Including Contingent Consideration The impact of changes to the fair value of assets and liabilities, including contingent and deferred consideration and non-marketable equity investments, and the related accretion income or expense are excluded from adjusted net earnings and adjusted EBITDA because they are not indicative of the Company’s ongoing operations due to the variability of the amounts and the lack of predictability as to the occurrence and/or timing and management believes their exclusion is helpful to understanding the underlying, ongoing operational performance of the business.
Fair Value Adjustments, Including Contingent Consideration The impact of changes to the fair value of assets and liabilities, including contingent and deferred consideration and non-marketable equity investments, and the related accretion income or expense are excluded from adjusted EBITDA, adjusted net earnings, and adjusted EPS because they are not indicative of the Company’s ongoing operations due to the variability of the amounts and the lack of predictability as to the occurrence and/or timing and management believes their exclusion is helpful to understanding the underlying, ongoing operational performance of the business.
Dollar Notes are subject to certain limitations and terms similar to those applicable to other guarantees of similar instruments, including that (i) the guarantees are subject to fraudulent transfer and conveyance laws and (ii) each guarantee is limited in amount to an amount not to exceed the maximum amount that can be guaranteed by the applicable guarantor without rendering the guarantee, as it relates to such guarantor, voidable under applicable fraudulent transfer and conveyance laws or similar laws affecting the rights of creditors generally.
Dollar Notes are subject to certain limitations and terms similar to those applicable to other guarantees of similar instruments, including that (i) the guarantees are subject to fraudulent transfer and conveyance laws and (ii) each guarantee is limited to an amount not to exceed the maximum amount that can be guaranteed by the applicable guarantor without rendering the guarantee, as it relates to such guarantor, voidable under applicable fraudulent transfer and conveyance laws or similar laws affecting the rights of creditors generally.
Acquisitions, Intangible Assets, Goodwill and Contingent Consideration The Company accounts for acquired businesses using the acquisition method of accounting in accordance with the provisions of ASC 805 , Business Combinations , which requires that the assets acquired and liabilities assumed be recorded at the date of acquisition at their respective estimated fair values.
Acquisitions, including Intangible Assets, Goodwill and Contingent Consideration The Company accounts for acquired businesses using the acquisition method of accounting in accordance with the provisions of ASC 805 , Business Combinations , which requires that the assets acquired and liabilities assumed be recorded at the date of acquisition at their respective estimated fair values.
Share-based Compensation Expense Share-based compensation expense is excluded from adjusted cost of sales, adjusted net earnings and adjusted EBITDA. Our share-based compensation programs have become increasingly weighted toward performance-based compensation, which leads to variability and to a lack of predictability as to the occurrence and/or timing of amounts incurred.
Share-based Compensation Expense Share-based compensation expense is excluded from adjusted cost of sales, adjusted EBITDA, adjusted net earnings, and adjusted EPS. Our share-based compensation programs have become increasingly weighted toward performance-based compensation, which leads to variability and to a lack of predictability as to the occurrence and/or timing of amounts incurred.
Because this process involves management making estimates with respect to future sales volumes, pricing, new product launches, government reform actions, anticipated cost environment and overall market conditions, and because these estimates form the basis for the determination of whether or not an impairment charge should be recorded, these estimates are considered to be critical accounting estimates. 73 Table of Contents The Company records contingent consideration liabilities resulting from business acquisitions or divestitures at its estimated fair value on the acquisition or divestiture date.
Because this process involves management making estimates with respect to future sales volumes, pricing, new product launches, government reform actions, anticipated cost environment and overall market conditions, and because these estimates form the basis for the determination of whether or not an impairment charge should be recorded, these estimates are considered to be critical accounting estimates. 72 Table of Contents The Company records contingent consideration liabilities resulting from business acquisitions or divestitures at its estimated fair value on the acquisition or divestiture date.
The income tax provision for the year ended December 31, 2023 was negatively impacted by the goodwill impairment related to the planned divestiture of the OTC Business, partially offset by the deferred tax impact of the Company’s internal tax restructuring.
The income tax provision for the year ended December 31, 2023 was negatively impacted by the goodwill impairment related to the divestiture of the OTC Business, partially offset by the deferred tax impact of the Company’s internal tax restructuring.
The following table presents unaudited summarized financial information of Viatris Inc., Mylan Inc., Utah Acquisition Sub Inc., and Mylan II B.V. on a combined basis as of and for the years ended December 31, 2023 and 2022. All intercompany balances have been eliminated in consolidation. This unaudited combined summarized financial information is presented utilizing the equity method of accounting.
The following table presents unaudited summarized financial information of Viatris Inc., Mylan Inc., Utah Acquisition Sub Inc., and Mylan II B.V. on a combined basis as of and for the years ended December 31, 2024 and 2023. All intercompany balances have been eliminated in consolidation. This unaudited combined summarized financial information is presented utilizing the equity method of accounting.
Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to utilize the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss incurred in certain taxing jurisdictions over the three-year period ended December 31, 2023.
Management assesses the available positive and negative evidence to estimate if sufficient future taxable income will be generated to utilize the existing deferred tax assets. A significant piece of objective negative evidence evaluated was the cumulative loss incurred in certain taxing jurisdictions over the three-year period ended December 31, 2024.
A variance of 5% between estimated and recorded litigation reserves and actual resolution of certain legal matters would have an effect on our litigation reserve balance of approximately $8.6 million. Refer to Note 19 Litigation included in Part II, Item 8 of this Form 10-K for further discussion of litigation matters.
A variance of 5% between estimated and recorded litigation reserves and actual resolution of certain legal matters would have an effect on our litigation reserve balance of approximately $19.2 million. Refer to Note 19 Litigation included in Part II, Item 8 of this Form 10-K for further discussion of litigation matters.
We have identified the following to be our critical accounting policies: the determination of net revenue provisions, acquisitions, intangible assets, goodwill and contingent consideration, income taxes and the impact of existing legal matters. Revenue Recognition We recognize revenues in accordance with ASC 606, Revenue from Contracts with Customers .
We have identified the following to be our critical accounting policies: the determination of net revenue provisions; accounting for acquisitions, including intangible assets, goodwill and contingent consideration; income taxes; and the impact of existing legal matters. Revenue Recognition We recognize revenues in accordance with ASC 606, Revenue from Contracts with Customers .
At December 31, 2023, our material cash requirements from known contractual and other obligations primarily relate to repayment of outstanding borrowings and interest, open purchase orders, post-employment benefit plans, unrecognized tax benefits, capital expenditures, dividends and leases. For additional information, refer to Notes 2, 7, 10, 12, 14, and 16 in Part II, Item 8 of this Form 10-K.
At December 31, 2024, our material cash requirements from known contractual and other obligations primarily relate to repayment of outstanding borrowings and interest, open purchase orders, post-employment benefit plans, unrecognized tax benefits, capital expenditures, dividends and leases. For additional information, refer to Notes 2, 7, 10, 12, 14, and 16 included in Part II, Item 8 of this Form 10-K.
The Company reports segment information on the basis of markets and geography, which reflects its focus on bringing its broad and diversified portfolio of branded and generic products, including complex products, to people in markets everywhere. Our Developed Markets segment comprises our operations primarily in North America and Europe.
The Company reports segment information on the basis of markets and geography, which reflects its focus on bringing its large and diversified portfolio of branded and generic products, including complex products, to people in markets everywhere. Our Developed Markets segment comprises our operations primarily in North America and Europe.
It is possible that an unfavorable resolution of any of the ongoing matters could have a material effect on the Company’s business, financial condition, results of operations, cash flows, ability to pay dividends and/or stock price.
It is possible that an unfavorable resolution of any of the ongoing matters could have a material effect on the Company’s business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price.
While the Company believes that it has meritorious defenses with respect to the claims asserted against it and the assumed legal matters referenced above, and intends to vigorously defend its position, the process of resolving these matters is inherently uncertain and may develop over a long period of time, and so it is not possible to predict the ultimate resolution of any such matter.
While the Company believes that it has meritorious defenses with respect to the claims asserted against it and the assumed legal matters referenced above, and intends to vigorously defend its position, the process of resolving these matters is 69 Table of Contents inherently uncertain and may develop over a long period of time, and so it is not possible to predict the ultimate resolution of any such matter.
(2) The constant currency percentage change is derived by translating net sales or revenues for the current period at prior year comparative period exchange rates, and in doing so shows the percentage change from 2023 constant currency net sales or revenues to the corresponding amount in the prior year.
(2) The constant currency percentage change is derived by translating net sales or revenues for the current period at prior year comparative period exchange rates, and in doing so shows the percentage change from 2024 constant currency net sales or revenues to the corresponding amount in the prior year.
Other Income, Net Other income, net includes gains and losses from divestitures of businesses, changes in the fair value of equity securities, foreign exchange, expense (income) related to post-employment benefit plans, TSA income, and interest and dividend income.
Other Expense (Income), Net Other expense (income), net includes gains and losses from divestitures of businesses, changes in the fair value of equity securities, extinguishment of debt, foreign exchange, expense (income) related to post-employment benefit plans, TSA income, and interest and dividend income.
Dollar Notes, which are fully and unconditionally guaranteed on a senior unsecured basis by Mylan Inc., Viatris Inc. and Mylan II B.V. Mylan Inc. is the issuer of the Mylan Inc. U.S. Dollar Notes, which are fully and unconditionally guaranteed on a senior unsecured basis by Mylan II B.V., Viatris Inc. and Utah Acquisition Sub Inc.
Following the Combination, Utah Acquisition Sub Inc. is the issuer of the Utah U.S. Dollar Notes, which are fully and unconditionally guaranteed on a senior unsecured basis by Mylan Inc., Viatris Inc. and Mylan II B.V. Mylan Inc. is the issuer of the Mylan Inc. U.S.
We continually monitor our provision for chargebacks and evaluate our reserve and estimates as additional information becomes available. A change of 5% would have an effect on our reserve balance of approximately $26.5 million. • Rebates, promotional programs and other sales allowances : this category includes rebate and other programs to assist in product sales.
We continually monitor our provision for chargebacks and evaluate our reserve and estimates as additional information becomes available. A change of 5% would have an effect on our reserve balance of approximately $24.7 million. • Rebates, promotional programs and other sales allowances : this category includes rebate and other programs to assist in product sales.
A variance of 5% between estimated reserves and valuation allowances and actual resolution and realization of these tax items would have an effect on our reserve balance and valuation allowance of approximately $34.7 million. Legal Matters Viatris is involved in various legal proceedings, some of which involve claims for substantial amounts.
A variance of 5% between estimated reserves and valuation allowances and actual resolution and realization of these tax items would have an effect on our reserve balance and valuation allowance of approximately $74.5 million. Legal Matters Viatris is involved in various legal proceedings, some of which involve claims for substantial amounts.
We estimate that the amounts that may be paid during the next twelve months to be approximately $89 million. Additionally, these agreements may also include potential sales-based milestones and call for us to pay a percentage of amounts earned from the sale of the product as a royalty or a profit share.
We estimate that the amounts that may be paid during the next twelve months to be approximately $33 million. These agreements may also include potential sales-based milestones and call for us to pay a percentage of amounts earned from the sale of the product as a royalty or a profit share.
GAAP, and adjusted cost of sales and adjusted gross margin for the year ended December 31, 2023 compared to the year ended December 31, 2022 is as follows: Year Ended December 31, (In millions, except %s) 2023 2022 U.S.
GAAP, and adjusted cost of sales and adjusted gross margin for the year ended December 31, 2024 compared to the year ended December 31, 2023 is as follows: Year Ended December 31, (In millions, except %s) 2024 2023 U.S.
We anticipate our cash requirements related to ordinary course purchases of goods and services will be consistent with our past levels. In the normal course of business, Viatris periodically enters into employment, legal settlement and other agreements which incorporate indemnification provisions.
We anticipate our cash requirements related to ordinary course purchases of goods and services will be consistent with our past levels. In the normal course of business, Viatris periodically enters into acquisition, divestiture, collaboration, employment, legal settlement and other agreements which incorporate indemnification provisions.
A change of 5% would have an effect on our reserve balance of approximately $55.2 million. • Returns : consistent with industry practice, Viatris maintains a return policy that allows customers to return a product, which varies country by country in accordance with local practices, generally within a specified period prior (six months) and subsequent (twelve months) to the expiration date.
A change of 5% would have an effect on our reserve balance of approximately $63.3 million. • Returns : consistent with industry practice, Viatris maintains a return policy that allows customers to return a product, which varies country by country in accordance with local practices, generally within a specified period prior (six months) and subsequent (twelve months) to the expiration date.
(b) Includes purchase accounting related amortization. (c) See items detailed in the Reconciliation of U.S. GAAP Net Earnings (Loss) to Adjusted Net Earnings. Liquidity and Capital Resources Our primary source of liquidity is net cash provided by operating activities, which was $2.80 billion for the year ended December 31, 2023.
(b) Includes purchase accounting related amortization. (c) See items detailed in the Reconciliation of U.S. GAAP Net (Loss) Earnings to Adjusted Net Earnings. Liquidity and Capital Resources Our primary source of liquidity is net cash provided by operating activities, which was $2.30 billion for the year ended December 31, 2024.
In addition, tax adjustments to adjusted earnings are recorded to present items on an after-tax basis consistent with the presentation of adjusted net earnings.
In addition, tax adjustments to adjusted earnings are recorded to present items on an after-tax basis consistent with the presentation of adjusted net earnings and adjusted EPS.
In 2023, significant items in financing activities included the following: • repayments of Senior Notes at maturity of approximately $1.25 billion, consisting of the 3.125% Senior Notes and the 4.200% Senior Notes; • share repurchases of $250.0 million; • cash dividends paid of $575.6 million; and • payment of $220.0 million to Biocon Biologics related to the closing working capital target, partially offset by net cash of $47.6 million, primarily collected on behalf of other partners, which are included in Other items, net.
In 2023, significant items in financing activities included the following: 66 Table of Contents • repayments of Senior Notes at maturity of approximately $1.25 billion, consisting of the 3.125% Senior Notes and the 4.200% Senior Notes; • share repurchases of $250.0 million; • cash dividends paid of $575.6 million; and • payment of $220.0 million to Biocon Biologics related to the closing working capital target, partially offset by net cash of $47.6 million collected on behalf of various partners, including Biocon Biologics, which are included in Other items, net.
The Company is in compliance with its covenants at December 31, 2023 and expects to remain in compliance for the next twelve months.
The Company is in compliance with its covenants at December 31, 2024 and expects to remain in compliance for the next twelve months.
A change of 5% would have an effect on our reserve balance of approximately $21.3 million. • Governmental rebate programs : government reimbursement programs in the U.S. include Medicare, Medicaid, and State Pharmacy Assistance Programs established according to statute, regulations and policy.
A change of 5% would have an effect on our reserve balance of approximately $20.0 million. • Governmental rebate programs : government reimbursement programs in the U.S. include Medicare, Medicaid, and State Pharmacy Assistance Programs established according to statute, regulations and policy.
(In millions) Year Ended December 31, 2023 Year Ended December 31, 2022 Revenues $ — $ — Gross profit — — Loss from operations (1,243.8) (1,132.4) Net earnings 54.7 2,078.6 Other Commitments The Company is involved in various disputes, governmental and/or regulatory inquiries, investigations and proceedings, tax proceedings and litigation matters, both in the U.S. and abroad, that arise from time to time, some of which could result in losses, including damages, fines and/or civil penalties, and/or criminal charges against the Company.
(In millions) Year Ended December 31, 2024 Year Ended December 31, 2023 Revenues $ — $ — Gross profit — — Loss from operations (1,206.6) (1,243.8) Net (loss) earnings (634.2) 54.7 Other Commitments The Company is involved in various disputes, governmental and/or regulatory inquiries, investigations and proceedings, tax proceedings and litigation matters, both in the U.S. and abroad, that arise from time to time, some of which could result in losses, including damages, fines and/or civil penalties, and/or criminal charges against the Company.
Due to the inherent uncertainty involved in making these estimates, assumptions and judgments, actual results could differ materially. Any future increases to the Company’s valuation allowances could materially impact the Company’s consolidated financial condition and results of operations. At December 31, 2023 and 2022, the Company’s net deferred tax assets totaled $692.9 million and $925.9 million, respectively.
Due to the inherent uncertainty involved in making these estimates, assumptions and judgments, actual results could differ materially. Any future increases to the Company’s valuation allowances could materially impact the Company’s consolidated financial condition and results of operations. At December 31, 2024 and 2023, the Company’s net deferred tax assets totaled $753.0 million and $692.9 million, respectively.
The significant items excluded from adjusted cost of sales, adjusted net earnings, and adjusted EBITDA include: 63 Table of Contents Purchase Accounting Amortization and Other Related Items The ongoing impact of certain amounts recorded in connection with acquisitions of both businesses and assets is excluded from adjusted cost of sales, adjusted net earnings, and adjusted EBITDA.
The significant items excluded from adjusted cost of sales, adjusted EBITDA, adjusted net earnings, and adjusted EPS include: Purchase Accounting Amortization and Other Related Items The ongoing impact of certain amounts recorded in connection with acquisitions of both businesses and assets is excluded from adjusted cost of sales, adjusted EBITDA, adjusted net earnings, and adjusted EPS.
(i) Adjusted for changes for uncertain tax positions. Reconciliation of U.S. GAAP Net Earnings (Loss) to EBITDA and Adjusted EBITDA Below is a reconciliation of U.S. GAAP net earnings (loss) to EBITDA and adjusted EBITDA for the year ended December 31, 2023 compared to the prior year periods: Year Ended December 31, (In millions) 2023 2022 2021 U.S.
(h) Adjusted for changes for uncertain tax positions. Reconciliation of U.S. GAAP Net (Loss) Earnings to EBITDA and Adjusted EBITDA Below is a reconciliation of U.S. GAAP net (loss) earnings to EBITDA and adjusted EBITDA for the year ended December 31, 2024 compared to the prior year periods: Year Ended December 31, (In millions) 2024 2023 2022 U.S.
Refer to the consolidated statements of cash flows in Part II, Item 8 of this Form 10-K for additional details on other significant sources and uses of cash during the years ended December 31, 2023 and 2022. Capital Resources Our cash and cash equivalents totaled $991.9 million at December 31, 2023.
Refer to the consolidated statements of cash flows in Part II, Item 8 of this Form 10-K for additional details on other significant sources and uses of cash during the years ended December 31, 2024 and 2023. Capital Resources Our cash and cash equivalents totaled $734.8 million at December 31, 2024.
Accruals for these provisions are presented in the consolidated financial statements as reductions in determining net sales and as a contra asset in accounts 71 Table of Contents receivable, net (if settled via credit) and other current liabilities (if paid in cash).
Accruals for these provisions are presented in the consolidated financial statements as reductions in determining net sales and as a contra asset in accounts receivable, net (if settled via credit) and other current liabilities (if paid in cash).
Borrowings outstanding under the Receivables Facility bear interest at the applicable base rate plus 0.775%, and under the Note Securitization Facility at the relevant base rate plus 1.00% and are included as a component of short-term borrowings, while the accounts receivable securing these obligations remain as a component of accounts receivable, net, in our consolidated balance sheets.
Borrowings outstanding under the Receivables Facility bear interest at the applicable base rate plus 0.775% and are included as a component of short-term borrowings, while the accounts receivable securing these obligations remain as a component of accounts receivable, net, in our consolidated balance sheets.
The Company also believes that adjusted EBITDA better focuses management on the Company’s underlying operational results and true business performance and, is used, in part, for management’s incentive compensation. We calculate EBITDA as U.S. GAAP net earnings (loss) adjusted for net contribution attributable to equity method investments, income tax provision (benefit), interest expense and depreciation and amortization.
The Company also believes that adjusted EBITDA better focuses management on the Company’s underlying operational results and true business performance and is used, in part, for management’s incentive compensation. We calculate EBITDA as U.S. GAAP net earnings (loss) adjusted for income tax provision (benefit), interest expense and depreciation and amortization.
EBITDA is further adjusted for share-based compensation expense, litigation settlements and other contingencies, net, and restructuring, impairment of long-lived assets, acquisition and divestiture related and other special items to determine adjusted EBITDA. These adjustments are generally permitted under our credit agreement in calculating adjusted EBITDA for determining compliance with our debt covenants.
EBITDA is further adjusted for share-based compensation expense, litigation settlements and other contingencies, net, gain (loss) on divestitures of businesses, impairment of long-lived assets and goodwill, restructuring, acquisition and divestiture-related and other special items to determine adjusted EBITDA. These adjustments are generally permitted under our credit agreement in calculating adjusted EBITDA for determining compliance with our debt covenants.
Refer to Note 5 Divestitures in Part II, Item 8 of this Form 10-K for more information. For information regarding our dividends paid and declared and share repurchase program, refer to Note 2 Summary of Significant Accounting Policies in Part II, Item 8 of this Form 10-K.
For information regarding our dividends paid and declared and share repurchase program, refer to Note 2 Summary of Significant Accounting Policies included in Part II, Item 8 of this Form 10-K.
In addition, the agreements governing the Receivables Facility and Note Securitization Facility contain various customary affirmative and negative covenants, and customary default and termination provisions. We have entered into accounts receivable factoring agreements with financial institutions to sell certain of our non-U.S. accounts receivable.
In addition, the agreement governing the Receivables Facility contains various customary affirmative and negative covenants, and customary default and termination provisions. We have entered into accounts receivable factoring agreements with financial institutions to sell certain of our non-U.S. accounts receivable.
Divestitures On October 1, 2023, the Company announced it received an offer for the divestiture of its OTC Business, and entered into definitive agreements to divest its women’s healthcare business and, separately, in another transaction, its rights to two women’s healthcare products in certain countries, its API business in India and commercialization rights in the Upjohn Distributor Markets.
Divestitures In October 2023, the Company announced it had received an offer for the divestiture of its OTC Business and had entered into definitive agreements to divest its women’s healthcare business, its API business in India, its rights to two women’s healthcare products in certain countries, and commercialization rights in the Upjohn Distributor Markets.
We have entered into employment and other agreements with certain executives and other employees that provide for compensation and certain other benefits. These agreements provide for severance payments under certain circumstances. Licensing and Other Partner Agreements Under our licensing and other partner agreements, our potential maximum development milestones not accrued for at December 31, 2023 totaled approximately $415.0 million.
We have entered into employment and other agreements with certain executives and other employees that provide for compensation and certain other benefits. These agreements provide for severance payments under certain circumstances. Licensing and Other Partner Agreements Under our licensing and other partner agreements, our potential maximum development milestones not accrued for at December 31, 2024 totaled approximately $419.4 million.
These amounts include items such as: • Costs related to formal restructuring programs and actions, including costs associated with facilities to be closed or divested, employee separation costs, impairment charges, accelerated depreciation, incremental manufacturing variances, equipment relocation costs, decommissioning and other restructuring related costs; • Certain acquisition and divestiture costs, including costs relating to integration and planning, advisory and legal fees, certain financing related costs, certain reimbursements related to the Company’s obligation to reimburse Pfizer for certain financing and transaction related costs under the Business Combination Agreement and Separation and Distribution Agreement, certain other TSA related set-up and exit costs, and other business transformation and/or optimization initiatives, which are not part of a formal restructuring program, including employee separation and post-employment costs; • The pre-tax loss of the Company’s clean energy investments, whose activities qualify for income tax credits under the Code; only included in adjusted net earnings is the net tax effect of the entity’s activities; • Other costs, incurred from time to time, related to certain special events or activities that lead to gains or losses, including, but not limited to, incremental manufacturing variances, asset write-downs, including other-than-temporary impairments of investments in equity or debt instruments, or liability adjustments; • Certain costs to further develop and optimize our global enterprise resource planning systems, operations and supply chain; • Gains or losses from divestitures, including impairments of held for sale assets; and • The impact of changes related to uncertain tax positions are excluded from adjusted cost of sales and adjusted net earnings.
These amounts include items such as: • Costs related to formal restructuring programs and actions, including costs associated with facilities to be closed or divested, employee separation costs, impairment charges, accelerated depreciation, incremental manufacturing variances, equipment relocation costs, decommissioning and other restructuring related costs; • Certain acquisition and divestiture costs, including costs relating to integration and planning, advisory and legal fees, certain financing related costs, certain reimbursements related to the Company’s obligation to reimburse Pfizer for certain financing and transaction related costs under the Business Combination Agreement and Separation and Distribution Agreement, certain other TSA related set-up and exit costs, and other business transformation and/or optimization initiatives, which are not part of a formal restructuring program, including employee separation and post-employment costs; • Other costs, incurred from time to time, related to certain special events or activities that lead to gains or losses, including, but not limited to, incremental manufacturing variances, asset write-downs, including other-than-temporary impairments of investments in equity or debt instruments, or liability adjustments; 63 Table of Contents • Certain costs to further develop and optimize our global enterprise resource planning systems, operations and supply chain; • Gains or losses from divestitures, including impairments of held for sale assets; and • The impact of changes related to uncertain tax positions are excluded from adjusted net earnings and adjusted EPS.
Such forward-looking statements may include, without limitation, statements about the goals or outlooks with respect to the Company’s strategic initiatives, including but not limited to the Company’s two-phased strategic vision and potential and announced divestitures, acquisitions or other transactions; the benefits and synergies of such divestitures, acquisitions, or other transactions, or restructuring programs; future opportunities for the Company and its products; and any other statements regarding the Company’s future operations, financial or operating results, capital allocation, dividend policy and payments, stock repurchases, debt ratio and covenants, anticipated business levels, future earnings, planned activities, anticipated growth, market opportunities, strategies, competitions, commitments, confidence in future results, efforts to create, enhance or otherwise unlock the value of our unique global platform, and other expectations and targets for future periods.
Such forward-looking statements may include, without limitation, statements about the goals or outlooks with respect to the Company’s strategic initiatives and priorities, including but not limited to divestitures, acquisitions, strategic alliances, collaborations, or other potential transactions; the benefits and synergies of such divestitures, acquisitions, strategic alliances, collaborations, or other transactions, or restructuring programs; future opportunities for the Company and its products; and any other statements regarding the Company’s future operations, financial or operating results, capital allocation, dividend policy and payments, share repurchases, debt ratio and covenants, anticipated business levels, future earnings, planned activities, anticipated growth, market opportunities, strategies, competitions, commitments, confidence in future results, efforts to create, enhance or otherwise unlock value, and other expectations and targets for future periods.
Such objective evidence limits the ability to consider other subjective evidence such as our projections for future growth. Based on this evaluation and other factors, as of December 31, 2023, a valuation allowance of $421.4 million has been recorded in order to measure only the portion of the deferred tax asset that more likely than not will be realized.
Such objective evidence limits the ability to consider other subjective evidence such as our projections for future growth. Based on this evaluation and other factors, as of December 31, 2024, a valuation allowance of $1.23 billion has been recorded in order to measure only the portion of the deferred tax asset that more likely than not will be realized.
These matters are often complex and have outcomes that are difficult to predict. We have approximately $173 million accrued for legal contingencies at December 31, 2023.
These matters are often complex and have outcomes that are difficult to predict. We have approximately $384 million accrued for legal contingencies at December 31, 2024.
Accounts receivable are presented net of allowances relating to these provisions, which were comprised of the following at December 31, 2023 and 2022, respectively: (In millions) December 31, 2023 December 31, 2022 Accounts receivable, net $ 1,483.6 $ 1,798.7 Other current liabilities 996.3 888.8 Total $ 2,479.9 $ 2,687.5 We have not made and do not anticipate making any significant changes to the methodologies that we use to measure provisions for variable consideration; however, the balances within these reserves can fluctuate significantly through the consistent application of our methodologies.
Accounts receivable are presented net of allowances relating to these provisions, which were comprised of the following at December 31, 2024 and 2023, respectively: (In millions) December 31, 2024 December 31, 2023 Accounts receivable, net $ 1,547.0 $ 1,483.6 Other current liabilities 989.4 996.3 Total $ 2,536.4 $ 2,479.9 We have not made and do not anticipate making any significant changes to the methodologies that we use to measure provisions for variable consideration; however, the balances within these reserves can fluctuate significantly through the consistent application of our methodologies.
We derecognized $30.8 million and $34.7 million of accounts receivable as of December 31, 2023 and 2022 under these factoring arrangements, respectively. Additionally, in 2023, we entered into a similar arrangement for certain European countries.
We derecognized $68.5 million and $30.8 million of accounts receivable as of December 31, 2024 and 2023, respectively, under these factoring arrangements. Additionally, in 2023, we entered into a similar arrangement for certain European countries.
For the Emerging Markets reporting unit, the estimated fair value exceeded its carrying value by approximately $513 million or 7.7% for the annual goodwill impairment test. As it relates to the discounted cash flow approach for the Emerging Markets reporting unit at April 1, 2023, the Company forecasted cash flows for the next 10 years.
For the Europe reporting unit, the estimated fair value exceeded its carrying value by approximately $882 million or 7.9% for the annual goodwill impairment test. As it relates to the discounted cash flow approach for the Europe reporting unit at April 1, 2024, the Company forecasted cash flows for the next 10 years.
Dollar Notes, subject to certain exceptions set forth in the applicable indenture, such guarantor ceasing to be a guarantor or obligor in respect of any Triggering Indebtedness; and (5) with respect to the Registered Upjohn Notes, (a) upon the applicable guarantor no longer being an issuer or guarantor in respect of (i) Mylan Notes (as defined in the indenture governing the Registered Upjohn Notes) that have an aggregate principal amount in excess of $500.0 million or (ii) any Triggering Indebtedness; in each case, other than in respect of indebtedness or guarantees, as applicable, that are being concurrently released; or (b) upon receipt of the consent of holders of a majority of the aggregate principal amount of the outstanding notes of such series in accordance with the indenture governing the Registered Upjohn Notes. 69 Table of Contents The guarantee obligations of Viatris Inc., Mylan Inc., Utah Acquisition Sub Inc., and Mylan II B.V. under the Senior U.S.
Dollar Notes, subject to certain exceptions set forth in the applicable indenture, such guarantor ceasing to be a guarantor or obligor in respect of any Triggering Indebtedness; and (5) with respect to the Registered Upjohn Notes, (a) upon the applicable guarantor no longer being an issuer or guarantor in respect of (i) Mylan Notes (as defined in the indenture governing the Registered Upjohn Notes) that have an aggregate principal amount in excess of $500.0 million or (ii) any Triggering Indebtedness; in each case, other than in respect of indebtedness or guarantees, as applicable, that are being concurrently released; or (b) upon receipt of the consent of holders of a majority of the aggregate principal amount of the outstanding notes of such series in accordance with the indenture governing the Registered Upjohn Notes.
GAAP cost of sales $ 8,988.3 $ 9,765.7 Deduct: Purchase accounting amortization and other related items (2,421.6) (2,721.2) Acquisition and divestiture-related costs (40.7) (50.0) Restructuring-related costs (101.8) (56.8) Share-based compensation expense (2.9) (1.5) Other special items (119.2) (255.2) Adjusted cost of sales $ 6,302.1 $ 6,681.0 Adjusted gross profit (a) $ 9,124.8 $ 9,581.7 Adjusted gross margin (a) 59 % 59 % ____________ (a) Adjusted gross profit is calculated as total revenues less adjusted cost of sales.
GAAP cost of sales $ 9,115.7 $ 8,988.3 Deduct: Purchase accounting amortization and other related items (2,581.1) (2,421.6) Acquisition and divestiture-related costs (71.5) (40.7) Restructuring-related costs (115.7) (101.8) Share-based compensation expense (3.7) (2.9) Other special items (143.0) (119.2) Adjusted cost of sales $ 6,200.7 $ 6,302.1 Adjusted gross profit (a) $ 8,538.6 $ 9,124.8 Adjusted gross margin (a) 58 % 59 % ____________ (a) Adjusted gross profit is calculated as total revenues less adjusted cost of sales.
Our Greater China segment includes our operations in China, Taiwan and Hong Kong. Our JANZ segment reflects our operations in Japan, Australia and New Zealand.
Our Greater China segment includes our operations in mainland China, Taiwan and Hong Kong. Our JANZ segment consists of our operations in Japan, Australia and New Zealand.
Adjusted gross margins were approximately 59% for the year ended December 31, 2023, essentially flat when compared to the year ended December 31, 2022. 60 Table of Contents A reconciliation between cost of sales, as reported under U.S.
Adjusted gross margins were approximately 58% for the year ended December 31, 2024, essentially flat when compared to the year ended December 31, 2023. A reconciliation between cost of sales, as reported under U.S.
Because of the subjective nature inherent in assessing the outcome of litigation and because of the potential that an adverse outcome in a legal proceeding could 76 Table of Contents have a material adverse effect on our business, financial condition, results of operations, cash flows, and/or ordinary share price, such estimates are considered to be critical accounting estimates.
Because of the subjective nature inherent in assessing the outcome of litigation and because of the potential that an adverse outcome in a legal proceeding could have a material adverse effect on our business, financial condition, results of operations, cash flows, ability to pay dividends or repurchase shares, and/or stock price, such estimates are considered to be critical accounting estimates.
In addition, net sales also decreased by approximately $70.4 million, or 3%, due to the inclusion of net sales in the prior year period related to divestitures that have closed during 2022 and 2023.
Net sales also decreased by approximately $16.4 million, or 1%, due to the inclusion of net sales in the prior year period related to divestitures that have closed during 2023 and 2024.
The decrease in net sales was partially driven by the unfavorable impact of foreign currency translation of approximately $258.9 million, or 2%, primarily reflecting changes in the U.S. Dollar as compared to the currencies of subsidiaries in Japan, China and India.
The decrease in net sales was also partially driven by the unfavorable impact of foreign currency translation of approximately $239.5 million, or 2%, primarily reflecting changes in the U.S. Dollar as compared to the currencies of subsidiaries in Japan, China, and countries in Emerging Markets.
For the years ended December 31, 2022 and 2021, the Company recorded $0.6 million, and $19.4 million, respectively, of impairment charges, which were recorded as a component of amortization expense. At December 31, 2023 and 2022, the Company’s IPR&D assets totaled $319.4 million and $40.2 million, respectively.
For the years ended December 31, 2024 and 2022, the Company recorded $177.1 million and $0.6 million, respectively, of impairment charges, which were recorded as a component of amortization expense. There were no IPR&D impairment charges in 2023. At December 31, 2024 and 2023, the Company’s IPR&D assets totaled $814.2 million and $319.4 million, respectively.
GAAP financial measure. Investors and other readers are encouraged to review the related U.S. GAAP financial measures and the reconciliation of non-GAAP measures to their most directly comparable U.S.
Use of Non-GAAP Financial Measures Whenever the Company uses non-GAAP financial measures, we provide a reconciliation of the non-GAAP financial measures to their most directly comparable U.S. GAAP financial measure. Investors and other readers are encouraged to review the related U.S. GAAP financial measures and the reconciliation of non-GAAP measures to their most directly comparable U.S.
During the forecast period, the revenue compound annual growth rate was approximately 1.8%. A terminal year value was calculated with a 2.0% revenue growth rate applied. The discount rate utilized was 11.5% and the estimated tax rate was 17.4%.
During the forecast period, the revenue compound annual growth rate was approximately negative 0.3%. A terminal year value was calculated with a 1.0% revenue growth rate applied. The discount rate utilized was 8.0% and the estimated tax rate was 30.3%.
Adjusted gross margin is calculated as adjusted gross profit divided by total revenues. Operating Expenses Research and Development Expense R&D expense for the year ended December 31, 2023 was $805.2 million, compared to $662.2 million for the prior year, an increase of $143.0 million.
Adjusted gross margin is calculated as adjusted gross profit divided by total revenues. Operating Expenses Research and Development Expense R&D expense for the year ended December 31, 2024 was $808.7 million, essentially flat compared to R&D expense of $805.2 million for the prior year.
We are continuously evaluating the potential acquisition of products, as well as companies, as a strategic part of our future growth. Consequently, we may utilize current cash reserves or incur additional indebtedness to finance any such acquisitions, which could impact future liquidity.
These amounts are included within Accounts payable in the consolidated balance sheets. 67 Table of Contents We are continuously evaluating the potential acquisition of products, as well as companies, as a strategic part of our future growth. Consequently, we may utilize current cash reserves or incur additional indebtedness to finance any such acquisitions, which could impact future liquidity.
In addition, in connection with the OTC Transaction and the divestiture of our women’s healthcare business, we have agreed, at the closing of the respective transactions, to enter into distribution agreements for certain markets for a limited period of time.
In addition, in connection with the OTC Transaction and the divestiture of our women’s healthcare business, we entered into distribution agreements for certain markets for a limited period of time.
The Company anticipates having sufficient liquidity, including existing borrowing capacity under the Revolving Facility, Commercial Paper Program, Receivables Facility, and Note Securitization Facility combined with cash to be generated from operations, to fund foreseeable cash needs without requiring the repatriation of non-U.S. cash. The Company has access to $4.0 billion under the Revolving Facility which matures in July 2026.
The Company anticipates having sufficient liquidity, including existing borrowing capacity under the 2024 Revolving Facility, Commercial Paper Program, and Receivables Facility combined with cash to be generated from operations, to fund foreseeable cash needs without requiring the repatriation of non-U.S. cash.
This decrease was partially the result of the unfavorable impact of foreign currency translation of approximately $96.2 million, or 6%. Net sales also decreased by approximately $18.8 million, or 1%, due to the inclusion of net sales in the prior year period related to divestitures that have closed during 2022 and 2023.
Net sales decreased by approximately $294.6 million, or 12%, due to the inclusion of net sales in the prior year period related to divestitures that have closed during 2023 and 2024. The decrease in net sales was also partially driven by the unfavorable impact of foreign currency translation of approximately $116.2 million, or 5%.
Based on this evaluation, as of December 31, 2023, our reserve for unrecognized tax benefits totaled $272.8 million, of which $204.3 million was recorded in connection with the Combination and is subject to Pfizer’s indemnification obligations to Viatris under the Tax Matters Agreement.
Based on this 74 Table of Contents evaluation, as of December 31, 2024, our reserve for unrecognized tax benefits totaled $255.7 million, of which $182.2 million was recorded in connection with the Combination and is subject to Pfizer’s indemnification obligations to Viatris under the Tax Matters Agreement.
In connection with our API business divestiture, we have agreed to enter into a manufacturing and supply agreement pursuant to which we will purchase a significant amount of API from the purchaser in that transaction.
In connection with the API business divestiture, we entered into a manufacturing and supply agreement pursuant to which we are purchasing a significant amount of API from the purchaser in that transaction.
During 2022 and 2023, the global economy has been impacted by high levels of inflation and rising energy costs, which has resulted in significant economic volatility. As a result, central banks have and may continue to tighten their monetary policies and increase interest rates.
In recent years, the global economy has been impacted by high levels of inflation and rising energy costs, which has resulted in significant economic volatility. As a result, central banks have tightened their monetary policies and increased interest rates.
The current year and prior year provisions were impacted by the levels of income and the changing mix at which it is earned in jurisdictions with differing tax rates. 2022 Compared to 2021 Discussions of 2021 items and year-to-year comparisons between 2022 and 2021 are not included in this Form 10-K, and can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. 62 Table of Contents Use of Non-GAAP Financial Measures Whenever the Company uses non-GAAP financial measures, we provide a reconciliation of the non-GAAP financial measures to their most directly comparable U.S.
The current year and prior year provisions were also impacted by the levels of income and the changing mix at which it is earned in jurisdictions with differing tax rates. 2023 Compared to 2022 Discussions of 2022 items and year-to-year comparisons between 2023 and 2022 are not included in this Form 10-K, and can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023.
Changes to any of the Company’s assumptions related to the estimated fair value based on the discounted cash flows, including discount rates or the competitive environment related to the assets, could lead to future material impairment charges.
Changes to any of the Company’s assumptions related to the estimated fair value based on the discounted cash flows, including discount rates or the competitive environment related to the assets, could lead to future material impairment charges. Any future long-lived assets impairment charges could have a material impact on the Company’s consolidated financial condition and results of operations.
GAAP net earnings (loss) $ 54.7 $ 2,078.6 $ (1,269.1) Add adjustments: Net contribution attributable to equity method investments — — 61.9 Income tax provision 148.2 734.6 604.7 Interest expense (a) 573.1 592.4 636.2 Depreciation and amortization (b) 2,740.5 3,027.6 4,506.5 EBITDA $ 3,516.5 $ 6,433.2 $ 4,540.2 Add / (deduct) adjustments: Share-based compensation expense 180.7 116.4 111.2 Litigation settlements and other contingencies, net 111.6 4.4 329.2 Loss (gain) on divestitures of businesses 239.9 (1,754.1) — Impairment of goodwill related to assets held for sale 580.1 117.0 — Restructuring, acquisition and divestiture-related and other special items (c) 495.3 859.9 1,375.4 Adjusted EBITDA $ 5,124.1 $ 5,776.8 $ 6,356.0 ____________ (a) Includes amortization of premiums and discounts on long-term debt.
GAAP net (loss) earnings $ (634.2) $ 54.7 $ 2,078.6 Add adjustments: Income tax provision 11.0 148.2 734.6 Interest expense (a) 550.0 573.1 592.4 Depreciation and amortization (b) 2,893.2 2,740.5 3,027.6 EBITDA $ 2,820.0 $ 3,516.5 $ 6,433.2 Add / (deduct) adjustments: Share-based compensation expense 146.1 180.7 116.4 Litigation settlements and other contingencies, net 350.9 111.6 4.4 Loss (gain) on divestitures of businesses 399.4 239.9 (1,754.1) Impairment of goodwill 321.0 580.1 117.0 Restructuring, acquisition and divestiture-related and other special items (c) 632.0 495.3 859.9 Adjusted EBITDA $ 4,669.4 $ 5,124.1 $ 5,776.8 ____________ (a) Includes amortization of premiums and discounts on long-term debt.
The majority of our cash is invested in U.S. government money market funds. In order to support our global operations, we maintain significant cash and cash equivalents within the banking system with the majority of this at Global Systemically Important Banks. We monitor the third-party depository institutions that hold our cash and cash equivalents on a regular basis.
The majority of our cash is invested in U.S. government money market funds and in bank deposits. In order to support our global operations, we maintain significant cash and cash equivalents within the banking system with the majority of this at Global Systemically Important Banks.
Long-term Debt Maturity For information regarding our debt agreements and mandatory minimum repayments remaining on the outstanding notional amount of long-term debt at December 31, 2023, refer to Note 10 Debt in Part II, Item 8 of this Form 10-K. 68 Table of Contents The YEN Term Loan Facility and the Revolving Facility contain customary affirmative covenants for facilities of this type, including among others, covenants pertaining to the delivery of financial statements, notices of default and certain material events, maintenance of corporate existence and rights, property, and insurance and compliance with laws, as well as customary negative covenants for facilities of this type, including a financial covenant, which set the Maximum Leverage Ratio as of the end of any quarter at 3.75 to 1.00 for the quarter ended March 31, 2023 and each quarter ending thereafter, except in circumstances as defined in the related credit agreement, and other limitations on the incurrence of subsidiary indebtedness, liens, mergers and certain other fundamental changes, investments and loans, acquisitions, transactions with affiliates, payments of dividends and other restricted payments and changes in our lines of business.
The YEN Term Loan Facility and the 2024 Revolving Facility contain customary affirmative covenants for facilities of this type, including among others, covenants pertaining to the delivery of financial statements, notices of default and certain material events, maintenance of corporate existence and rights, property, and insurance and compliance with laws, as well as customary negative covenants for facilities of this type, including a financial covenant, which set the Maximum Leverage Ratio as of the end of any quarter at 3.75 to 1.00, except in circumstances as defined in the related credit agreement, and other limitations on the incurrence of subsidiary indebtedness, liens, mergers and certain other fundamental changes, investments and loans, acquisitions, transactions with affiliates, payments of dividends and other restricted payments and changes in our lines of business.
While the maximum amount to which Viatris may be exposed under such agreements cannot be reasonably estimated, the Company maintains insurance coverage, which management believes will effectively mitigate the Company’s obligations under these indemnification provisions. No amounts have been recorded in the consolidated financial statements with respect to the Company’s obligations under such agreements.
Further, for certain agreements, the Company maintains insurance coverage, which management believes will effectively mitigate the Company’s obligations under these indemnification provisions. No amounts have been recorded in the consolidated financial statements with respect to the Company’s obligations under such agreements.
As discussed below, Viatris has entered into certain transactions, including the Pending Announced Divestitures. Viatris is headquartered in the U.S., with global centers in Pittsburgh, Pennsylvania, Shanghai, China and Hyderabad, India. Viatris has four reportable segments: Developed Markets, Greater China, JANZ, and Emerging Markets.
Viatris is headquartered in the U.S., with global centers in Pittsburgh, Pennsylvania, Shanghai, China and Hyderabad, India. Viatris has four reportable segments: Developed Markets, Greater China, JANZ, and Emerging Markets.
The entrance into the market of additional competition generally has a negative impact on the volume and pricing of the affected products. Additionally, pricing is often affected by factors outside of the Company’s control.
As such, the timing of new product introductions can have a significant impact on the Company’s financial results. The entrance into the market of additional competition generally has a negative impact on the volume and pricing of the affected products. Additionally, pricing is often affected by factors outside of the Company’s control.
As of December 31, 2023, the Company did not have any borrowings outstanding under the Receivables Facility or the Note Securitization Facility. Under the terms of each of the Receivables Facility and Note Securitization Facility, certain of our accounts receivable secure the amounts borrowed and cannot be used to pay our other debts or liabilities.
The Company has a $400 million Receivables Facility which expires in April 2025. As of December 31, 2024, the Company did not have any borrowings outstanding under the Receivables Facility. Under the terms of the Receivables Facility, certain of our accounts receivable secure the amounts borrowed and cannot be used to pay our other debts or liabilities.
The respective obligations of Viatris Inc., Mylan Inc., Utah Acquisition Sub Inc., and Mylan II B.V. as guarantors of the applicable series of Senior U.S.
The guarantee obligations of Viatris Inc., Mylan Inc., Utah Acquisition Sub Inc., and Mylan II B.V. under the Senior U.S.
In the U.S. and some other countries, when market exclusivity expires and generic versions of a product are approved and marketed, there can often be very substantial and rapid declines in the branded product’s sales.
In the U.S. and some other countries, when market exclusivity expires and generic versions of a product are approved and marketed, there can often be very substantial and rapid declines in the branded product’s sales. For example, generic entry may occur for Amitiza® 24 μg in Japan in December 2025 upon expiration of patent exclusivity.
Viatris’ executive management team is focused on ensuring that the Company is optimally structured and efficiently resourced to deliver sustainable value to patients, shareholders, customers and other key stakeholders.
Viatris’ executive management team is focused on ensuring that the Company is optimally structured and efficiently resourced to deliver sustainable value to patients, shareholders, customers and other key stakeholders. The Company operates in more than 165 countries and territories with approximately 32,000 employees.

… 170 more changes not shown on this page.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

7 edited+0 added−1 removed7 unchanged
Biggest changeIf our net investment decreases below the equivalent value of the non-U.S. debt borrowings, the change in the remeasurement basis of the debt would be subject to recognition in net income as changes occur. 77 Table of Contents Interest Rate and Long-Term Debt Risk Viatris’ exposure to interest rate risk arises primarily from our U.S.
Biggest changeThe foreign exchange gains or losses on these hedges is included in the foreign currency translation component of accumulated other comprehensive income (loss). If our net investment decreases below the equivalent value of the non-U.S. debt borrowings, the change in the remeasurement basis of the debt would be subject to recognition in net income as changes occur.
A 100 basis point change in interest rates on Viatris’ variable rate debt would result in a change in interest expense of approximately $2.9 million per year.
A 100 basis point change in interest rates on Viatris’ variable rate debt would result in a change in interest expense of approximately $2.6 million per year.
Fair Value Risk The Company’s fair value risk exposure relates primarily to our equity investments that do not have readily determinable fair values, principally the CCPS received as part of the Biocon Biologics Transaction. As of December 31, 2023 and 2022, the carrying value of these investments were approximately $1.14 billion and $1.09 billion, respectively.
Fair Value Risk The Company’s fair value risk exposure relates primarily to our equity investments that do not have readily determinable fair values, principally the CCPS received as part of the Biocon Biologics Transaction. As of December 31, 2024 and 2023, the carrying value of these investments were approximately $1.35 billion and $1.14 billion, respectively.
As of December 31, 2023, Viatris’ outstanding fixed rate borrowings consist principally of $17.33 billion notional amount of senior U.S. dollar and Euro notes. Generally, the fair value of fixed interest rate debt will decrease as interest rates rise and increase as interest rates fall.
As of December 31, 2024, Viatris’ outstanding fixed rate borrowings consist principally of $13.33 billion notional amount of senior U.S. dollar and Euro notes. Generally, the fair value of fixed interest rate debt will decrease as interest rates rise and increase as interest rates fall.
As of December 31, 2023, the fair value of our outstanding fixed rate senior U.S. dollar and Euro notes was approximately $15.25 billion. As of December 31, 2023, Viatris’ outstanding variable rate borrowings consist principally of borrowings under the Yen Term Loan Facility of $283.6 million.
As of December 31, 2024, the fair value of our outstanding fixed rate senior U.S. dollar and Euro notes was approximately $11.53 billion. As of December 31, 2024, Viatris’ outstanding variable rate borrowings consist principally of borrowings under the Yen Term Loan Facility of $254.4 million.
A hypothetical 20 percent decline in the fair value of these investments would have decreased the carrying value and other income, net by approximately $228.4 million at December 31, 2023. 78 Table of Contents
A hypothetical 20 percent decline in the fair value of these investments would have decreased the carrying value and increased other expense (income), net by approximately $270.0 million at December 31, 2024. 76 Table of Contents
Dollar and Euro borrowings and U.S. Dollar investments. We invest primarily on a variable-rate basis and we borrow on both a fixed and variable basis.
Interest Rate and Long-Term Debt Risk Viatris’ exposure to interest rate risk arises primarily from our U.S. Dollar and Euro borrowings and U.S. Dollar investments. We invest primarily on a variable-rate basis and we borrow on both a fixed and variable basis.
Removed
The foreign exchange gains or losses on these hedges is included in the foreign currency translation component of accumulated other comprehensive income (loss).

Other VTRS 10-K year-over-year comparisons