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What changed in Bausch & Lomb Corp's 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Bausch & Lomb Corp'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.

+523 added−529 removedSource: 10-K (2025-02-19) vs 10-K (2024-02-21)

Top changes in Bausch & Lomb Corp's 2024 10-K

523 paragraphs added · 529 removed · 414 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

81 edited+22 added−25 removed126 unchanged
Biggest changeVision Care $ 2,543 61 % $ 2,369 63 % $ 2,327 62 % Pharmaceuticals 836 20 % 681 18 % 720 19 % Surgical 767 19 % 718 19 % 718 19 % Total revenues $ 4,146 100 % $ 3,768 100 % $ 3,765 100 % Effective in the first quarter of 2023, certain products historically included in the reported results of the Pharmaceuticals segment are now included in the reported results of the Vision Care segment and certain products included in the reported results of the Vision Care segment are now included in the reported results of the Pharmaceuticals segment.
Biggest changeVision Care $ 2,739 57 % $ 2,543 61 % $ 2,369 63 % Pharmaceuticals 1,209 25 % 836 20 % 681 18 % Surgical 843 18 % 767 19 % 718 19 % Total revenues $ 4,791 100 % $ 4,146 100 % $ 3,768 100 % Comparative segment information for 2024, 2023 and 2022 is further presented in Note 21, “SEGMENT INFORMATION” to our audited Consolidated Financial Statements.
Biotrue ® ONEday for Presbyopia integrates the Company’s 3-Zone Progressive™ design with seamless transitions between near, far and intermediate distances for clear, comfortable vision across all distances. 3 • PureVision ® , a silicone hydrogel frequent replacement contact lens using AerGel ® technology lens material to allow natural levels of oxygen to reach the eye as well as resist protein buildup.
Biotrue ® ONEday for Presbyopia integrates the Company’s 3-Zone Progressive™ design with seamless transitions between near, far and intermediate distances for clear, comfortable vision across all distances. • PureVision ® , a silicone hydrogel frequent replacement contact lens using AerGel ® technology lens material to allow natural levels of oxygen to reach the eye as well as resist protein buildup.
The Company also has a robust, global succession planning process that allows us to define talent needs based on business strategy, identify talent and drive development and growth, strengthen the pipeline for critical leadership positions, and optimize talent deployment across the business.
The Company also has a robust, global succession planning process that allows us to define talent needs based on business strategy, identify talent, drive development and growth, strengthen the pipeline for critical leadership positions and optimize talent deployment across the business.
Biotrue ® multi-purpose solution contains hyaluronic acid (sodium hyaluronate) a lubricant naturally found in eyes and is pH balanced to match healthy tears. • Bausch + Lomb Renu ® Advanced Formula multi-purpose solution is a novel soft and silicone hydrogel contact lens solution that makes use of three disinfectants and two moisture agents. • Boston ® solution is a specialty cleansing solution design for gas permeable contact lenses. 2 • Artelac ® is an eye moisturizer eye drop which enables quick wetting of dry eyes.
Biotrue ® multi-purpose solution contains hyaluronic acid (sodium hyaluronate) a lubricant naturally found in eyes and is pH balanced to match healthy tears. • Bausch + Lomb Renu ® Advanced Formula multi-purpose solution is a novel soft and silicone hydrogel contact lens solution that makes use of three disinfectants and two moisture agents. • Boston ® solution is a specialty cleansing solution design for gas permeable contact lenses. • Artelac ® is an eye moisturizer eye drop which enables quick wetting of dry eyes.
You are invited to read and copy any reports, statements or other information, other than confidential filings, that we file with the CSA. These filings are also electronically available from the Canadian System for Electronic Document Analysis and Retrieval + (“SEDAR+”) at www.sedarplus.ca , the Canadian equivalent of the SEC’s electronic document gathering and retrieval system. 15
You are invited to read and copy any reports, statements or other information, other than confidential filings, that we file with the CSA. These filings are also electronically available from the Canadian System for Electronic Data Analysis and Retrieval + (“SEDAR+”) at www.sedarplus.ca , the Canadian equivalent of the SEC’s electronic document gathering and retrieval system. 15
These employees are located around the world, with approximately 5,100 in the United States, 3,300 in Europe excluding Ireland, 2,300 in Asia-Pacific countries, 1,600 in Ireland, 400 in Latin America, 400 in Russia and Commonwealth of Independent State countries, 100 in Canada and 100 in the Middle East and Africa. Collective bargaining exists for some employees in several countries.
These employees are located around the world, with approximately 5,200 in the United States, 3,400 in Europe excluding Ireland, 2,300 in Asia-Pacific countries, 1,600 in Ireland, 400 in Latin America, 400 in Russia and Commonwealth of Independent State countries, 100 in Canada and 100 in the Middle East and Africa. Collective bargaining exists for some employees in several countries.
The PIPL is the first national-level law comprehensively regulating issues in relation to personal information protection. The PIPL provides for very specific administrative requirements and security controls when transferring personal data outside the Peoples Republic of China. These transfer requirements came into effect on March 1, 2023.
The PIPL is the first Chinese national-level law comprehensively regulating issues in relation to personal information protection. The PIPL provides for very specific administrative requirements and security controls when transferring personal data outside the Peoples Republic of China. These transfer requirements came into effect on March 1, 2023.
Biotrue ® ONEday for Astigmatism includes evolved peri-ballast geometry designed to work with natural blink patterns to deliver stability, clear vision and comfort for the astigmatic patient. • Biotrue ® ONEday for Presbyopia daily disposable contact lens for presbyopic patients developed using the Company’s proprietary Surface Active Technology.
Biotrue ® ONEday for Astigmatism includes evolved peri-ballast geometry designed to work with natural blink patterns to deliver stability, clear vision and comfort for the astigmatic patient. • Biotrue ® ONEday for Presbyopia daily disposable contact lens for presbyopic patients developed using the Company’s proprietary Surface Active Technology TM .
This single laser platform enables surgeons to perform capsulotomies, fragmentation, arcuate incisions, corneal incisions, and LASIK flaps. ◦ Teneo TM Excimer Laser system for corneal refractive surgery. • Intraocular Lenses ◦ A portfolio of ophthalmic surgical IOLs, including implantable IOLs such as Akreos ® , enVista ® , Crystalens ® and Trulign ® .
This single laser platform enables surgeons to perform capsulotomies, fragmentation, arcuate incisions, corneal incisions and LASIK flaps. ◦ Teneo ® Excimer Laser system for corneal refractive surgery. • Intraocular Lenses ◦ A portfolio of ophthalmic surgical IOLs, including implantable IOLs such as Akreos ® , enVista ® , Crystalens ® and Trulign ® .
In the United States, the EU and other significant or potentially significant markets for our products and product candidates, government authorities and third-party payors are increasingly 10 attempting to limit or regulate the price of medical products and services, which has resulted in lower average realized prices.
In the United States, the EU and other significant or potentially significant markets for our products and product candidates, government authorities and third-party payors are increasingly attempting to limit or regulate the price of medical products and services, which has resulted in lower average realized prices.
In addition, we believe that 1 we can grow our market opportunity by expanding into emerging therapeutic areas, new geographies and researching and securing other indications for our products.
In addition, we believe that we can grow our market opportunity by expanding into emerging therapeutic areas, new geographies and researching and securing other indications for our products.
This approach harnesses the cross-functional expertise of our R&D, quality, clinical, medical and regulatory affairs, supply chain and commercial representatives at every phase of product development. Our R&D organization focuses on the development of products through clinical trials. Currently, we have over 60 R&D projects in our global pipeline, which are being developed in and for multiple countries.
This approach harnesses the cross-functional expertise of our R&D, quality, clinical, medical and regulatory affairs, supply chain and commercial representatives at every phase of product development. Our R&D organization focuses on the development of products through clinical trials. Currently, we have approximately 60 R&D projects in our global pipeline, which are being developed in and for multiple countries.
In the U.S., the Hatch-Waxman Act provides non-patent regulatory exclusivity for five years from the date of the first FDA approval of a new drug compound in a New Drug Application (“NDA”). The FDA, with one exception, is prohibited during those five years from accepting for filing a generic, or an Abbreviated New Drug Application (“ANDA”), that references the NDA.
In the U.S., the Hatch-Waxman Act provides non-patent regulatory exclusivity for five years from the date of the first FDA approval of a new drug compound ("NCE") in a NDA. The FDA, with one exception, is prohibited during those five years from accepting for filing a generic, or an Abbreviated New Drug Application (“ANDA”), that references the NDA.
The regulatory framework for data privacy, data security and data transfers worldwide is rapidly evolving and is likely to remain uncertain for the foreseeable future.
The regulatory 10 framework for data privacy, data security and data transfers worldwide is rapidly evolving and is likely to remain uncertain for the foreseeable future.
In the United States, we have approximately 1,100 employees on our commercial team dedicated to our efforts to sell and market contact lens, lens care, consumer eye health, surgical and prescription pharmaceutical products, which are sold through wholesalers, retailers and eye care professional practices.
In the United States, we have approximately 1,150 employees on our commercial team dedicated to our efforts to sell and market contact lens, lens care, consumer eye health, surgical and prescription pharmaceutical products, which are sold through wholesalers, retailers and eye care professional practices.
We continually seek input from eye care professionals through medical and scientific advisory boards to help us refresh and update all of these initiatives as well as to create new opportunities to provide our customers with the necessary resources to use our products safely and effectively.
We continually seek input from eye care professionals through medical and scientific advisory boards to help us refresh and update these initiatives as well as to create new opportunities to provide our customers with the necessary resources to use our products safely and effectively.
The SEC also maintains an Internet website at www.sec.gov that contains reports, proxy and information statements and other information regarding issuers, including us, that file electronically with the SEC. We are also required to file reports and other information with the securities commissions in all provinces and territories in Canada.
The SEC also maintains an Internet website at www.sec.gov that contains reports, proxy and information statements and other information regarding issuers, including us, that file electronically with the SEC. We are also required to file reports and other information with the securities commissions in all provinces (except Quebec) and territories in Canada.
To achieve this goal, we plan to generate sustainable and profitable growth by employing the following strategies: • Leverage our expertise as an eye health-focused company to strengthen our market position - Our comprehensive product offering—spanning over-the counter (“OTC”) products, nutritional supplements, eye health products, ophthalmic pharmaceuticals, contact lenses, lens care products and ophthalmic surgical devices and instruments— allows us to build strong brand loyalty and engage with patients and consumers throughout the entire continuum of their eye health needs over time.
To achieve this goal, we plan to position the Company for sustainable and profitable long-term growth by employing the following strategies: • Leverage our expertise as an eye health-focused company to strengthen our market position - Our comprehensive product offering—spanning over-the counter (“OTC”) products, nutritional supplements, eye health products, ophthalmic pharmaceuticals, contact lenses, lens care products and ophthalmic surgical devices and instruments— allows us to build strong brand loyalty and engage with patients and consumers throughout the entire continuum of their eye health needs over time.
For example, with respect to some of our largest or most significant products, the supply of the finished product for each of our Lumify ® , Vyzulta ® , SofLens ® , MIEBO ® , XIIDRA ® and PureVision ® products are only available from a single source, the supply of the active pharmaceutical ingredients or other components for our Vyzulta ® , MIEBO ® and PreserVision ® products are also only available from a single source and certain of our Biotrue ® , Softlens ® and Ultra ® contact lens products are also only available from a single source.
For example, with respect to some of our largest or most significant products, the supply of the finished product for each of our Lumify ® , Vyzulta ® , SofLens ® , MIEBO ® , XIIDRA ® and PureVision ® products are only available from a single source, the supply of the active pharmaceutical ingredients or other components for our Lumify ® , Vyzulta ® , MIEBO ® and PreserVision ® products are also only available from a single source and certain of our Biotrue ® , Soflens ® and Bausch + Lomb Ultra ® contact lens products are also only available from a single source.
The expiration of these patents is not expected to have a material adverse effect on our business. We currently own or exclusively license approximately 126 pending U.S. patent applications.
The expiration of these patents is not expected to have a material adverse effect on our business. We currently own or exclusively license approximately 127 pending U.S. patent applications.
Generally, preclinical studies and clinical trials of the products must first be conducted and the results submitted to the applicable regulatory agency (such as the FDA) for approval. In addition, with respect to medical devices, in April 2017, the European Commission adopted the Medical Device Regulation (“MDR”), which replaced the Medical Device Directive (“MDD”).
Generally, preclinical studies and clinical trials of the products must first be conducted and the results submitted to the applicable regulatory agency (such as the FDA) for approval. In addition, with respect to medical devices, in April 2017, the European Commission adopted the European Medical Device Regulation (“EU MDR”), which replaced the Medical Device Directive (“MDD”).
Vision Care Our Vision Care segment consists of our consumer eye care and contact lens businesses. For the year ended December 31, 2023, our revenue from the Vision Care segment breaks down as follows: 65% from our consumer eye care business and 35% from our contact lens business.
Vision Care Our Vision Care segment consists of our consumer eye care and contact lens businesses. For the year ended December 31, 2024, our revenue from the Vision Care segment breaks down as follows: 65% from our consumer eye care business and 35% from our contact lens business.
As a consequence, beginning in June 2021 through May 2022, we have been required to appoint an authorized representative in Switzerland in order to export our CE- marked medical devices to Switzerland. Additionally, the name and address of the Swiss authorized representative must be placed on the packaging.
As a consequence, beginning in June 2021, we have been required to appoint an authorized representative in Switzerland in order to export our CE- marked medical devices to Switzerland. Additionally, the name and address of the Swiss authorized representative must be placed on the packaging.
For the year ended December 31, 2023, our revenue from Surgical products was comprised as follows: 25% from equipment, 24% from implantables and 51% from consumables.
For the year ended December 31, 2024, our revenue from Surgical products was comprised as follows: 25% from equipment, 24% from implantables and 51% from consumables.
Products representing approximately 26% of our product sales for 2023 are produced in total, or in part, by third-party manufacturers under manufacturing arrangements. In some cases, the principal raw materials, including active pharmaceutical ingredients, used by us (or our third-party manufacturers) for our various products are purchased in the open market or are otherwise available from several sources.
Products representing approximately 37% of our product sales for 2024 are produced in total, or in part, by third-party manufacturers under manufacturing arrangements. In some cases, the principal raw materials, including active pharmaceutical ingredients, used by us (or our third-party manufacturers) for our various products are purchased in the open market or are otherwise available from several sources.
Bausch + Lomb considers relations with employees to be good and have not experienced any work stoppages, slowdowns or other serious labor problems that have materially impeded business operations. During 2023, Bausch + Lomb did not experience any business disruption as a result of normal course employee turnover.
Bausch + Lomb considers relations with employees to be good and we have not experienced any work stoppages, slowdowns or other serious labor problems that have 13 materially impeded business operations. During 2024, Bausch + Lomb did not experience any business disruption as a result of normal course employee turnover.
The registering entity will then register each of the devices for which they are responsible for placing on the market in the UK, whether in Great Britain or Northern Ireland, as required by the UM MDR 2002. Until May 25, 2021, our products bearing a CE mark could be exported from the EEA to Switzerland.
The registering entity will then register each of the devices for which they are responsible for placing on the market in the UK, whether in Great Britain or Northern Ireland, as required by the UM MDR 2002. Until May 25, 2021, our products bearing a CE mark could be exported from the European Economic Area (“EEA”) to Switzerland.
We launched our first silicone hydrogel daily disposable multifocal contact lens in May 2023, and plan to launch a toric lens in 2024. • Bausch + Lomb ULTRA ® , a silicone hydrogel frequent replacement contact lens for patients with myopia or hyperopia that uses our proprietary MoistureSeal ® technology, which allows the contact lens to retain 95% of moisture after 16 hours of wear, limiting lens dryness and resulting symptoms. • Bausch + Lomb ULTRA ® for Astigmatism, a monthly planned replacement contact lens for astigmatic patients developed using our proprietary MoistureSeal ® technology.
In addition, we launched our first silicone hydrogel daily disposable multifocal contact lens in May 2023, and launched a toric lens in the U.S. in June 2024. • Bausch + Lomb ULTRA ® , a silicone hydrogel frequent replacement contact lens for patients with myopia or hyperopia that uses our proprietary MoistureSeal ® technology, which allows the contact lens to retain 95% of moisture after 16 hours of wear, limiting lens dryness and resulting symptoms. • Bausch + Lomb ULTRA ® for Astigmatism, a monthly planned replacement contact lens for astigmatic patients developed using our proprietary MoistureSeal ® technology.
In reference to the foregoing exception, if a patent is indexed in the FDA Orange Book for the new drug compound, a generic may file an ANDA four years from the NDA approval date if it also files a Paragraph IV Certification with the FDA challenging the patent.
In reference to the foregoing exception, if a patent is indexed in the FDA Orange Book for the NCE, a generic may file an ANDA four years from the NDA approval date if it also files a Paragraph IV Certification with the FDA challenging the patent.
As a fully integrated eye health business, Bausch + Lomb has an established line of contact lenses, intraocular lenses ("IOLs") and other medical devices, surgical systems and devices, vitamin and mineral supplements, lens care products, prescription eye-medications and other consumer products that positions us to compete in all areas of the eye health market.
As a fully integrated eye health business, Bausch + Lomb has a comprehensive portfolio of approximately 400 products, which includes an established line of contact lenses, intraocular lenses ("IOLs") and other medical devices, surgical systems and devices, vitamin and mineral supplements, lens care products, prescription eye-medications and other consumer products that positions us to compete in all areas of the eye health market.
Health, Safety and Wellness Our employees' health, safety and wellness are of utmost importance to us. On an ongoing basis, we measure how well we are fostering the health and safety of our employees through our Days Away Rate (“DAR”), which captures globally the number of days that our employees are away from work due to illness or injury.
On an ongoing basis, we measure how well we are fostering the health and safety of our employees through our Days Away Rate (“DAR”), which captures globally the number of days that our employees are away from work due to illness or injury.
For additional information and for details of key projects in our pipeline, see Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Overview — Positioning for Growth” of this Form 10-K.
For additional information and for details of key projects in our pipeline, see Item 7. “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Overview — Product Development” of this Form 10-K.
Human Capital Resources As of December 31, 2023, we had approximately 13,300 employees, which included approximately 7,200 in production, 4,250 in sales and marketing, 1,000 in general and administrative positions and 850 in R&D.
Human Capital Resources As of December 31, 2024, we had approximately 13,500 employees, which included approximately 7,200 in production, 4,300 in sales and marketing, 1,000 in general and administrative positions and 1,000 in R&D.
In 2023, we achieved an annual DAR of 6, which met our annual not to exceed goal of 6 and is far below other similar industry standard DAR of 22.
In 2024, we achieved an annual DAR of 4.9, which met our annual not to exceed goal of 6 and is far below other similar industry standard DAR of 22.
Data and Patent Exclusivity For certain of our products, we rely on a combination of regulatory and patent rights to protect the value of our investment in the development of these products. As of February 16, 2024, we own or exclusively license approximately 2,349 granted patents throughout the world, approximately 462 of which are U.S. patents.
Data and Patent Exclusivity For certain of our products, we rely on a combination of regulatory and patent rights to protect the value of our investment in the development of these products. As of February 12, 2025, we own or exclusively license approximately 2,584 granted patents throughout the world, approximately 465 of which are U.S. patents.
Our international commercial footprint is represented through approximately 3,150 employees on our commercial team as well as a network of distribution partners. 11 Our sales effort allows us to deliver the full suite of Bausch + Lomb products to key clinician decision makers, recognize cross-selling opportunities for key products from other product categories and impact consumer purchasing decisions. • Our sales representatives within the global consumer products and global vision care business categories are focused on promoting and selling our products to large and mid-sized retailers, pharmacies and eye care professionals as well as optimizing and expanding our shelf presence at retailers. • Our sales representatives within the ophthalmic pharmaceuticals business category are focused on promoting and marketing our products to wholesalers, large retailers, eye care professionals, independent pharmacies and hospitals. • Our sales representatives within the global surgical business category are focused on selling products and equipment to eye care professionals, physicians, including ophthalmic surgeons, hospitals and ambulatory surgery centers.
Our sales effort allows us to deliver the full suite of Bausch + Lomb products to key clinician decision makers, recognize cross-selling opportunities for key products from other product categories and impact consumer purchasing decisions. • Our sales representatives within the global consumer products and global vision care business categories are focused on promoting and selling our products to large and mid-sized retailers, pharmacies and eye care professionals as well as optimizing and expanding our shelf presence at retailers. • Our sales representatives within the ophthalmic pharmaceuticals business category are focused on promoting and marketing our products to wholesalers, large retailers, eye care professionals, independent pharmacies and hospitals. • Our sales representatives within the global surgical business category are focused on selling products and equipment to eye care professionals, physicians, including ophthalmic surgeons, hospitals and ambulatory surgery centers.
However, as of May 26, 2021, the Mutual Recognition Agreement between the European Economic Area (“EEA”) and Switzerland has not been updated to include the requirements of EU MDR.
However, as of May 26, 2021, the Mutual Recognition Agreement between the EEA and Switzerland has not been updated to include the requirements of the EU MDR.
Our private label distribution agreements do not, individually or in the aggregate, represent a material portion of our business and we are not substantially dependent on them. We also subcontract the manufacturing of certain of our products, including products manufactured under the rights acquired from other pharmaceutical companies.
These agreements may be subject to minimum purchase or sales obligations. Our private label distribution agreements do not, individually or in the aggregate, represent a material portion of our business and we are not substantially dependent on them. We also subcontract the manufacturing of certain of our products, including products manufactured under the rights acquired from other pharmaceutical companies.
Through the date of this filing, all of our global operations and facilities have the relevant operational good manufacturing practices certificates and all Company products and operating sites are in good compliance standing with all relevant notified bodies and global health authorities.
Through the date of this filing, all of our global operations and facilities have the relevant operational good manufacturing practices certificates and all Company products and operating sites are in good compliance standing with all relevant notified bodies and global health authorities. We use a diverse and broad range of raw materials in manufacturing our products.
As of December 31, 2023, approximately 850 dedicated R&D personnel globally in 12 R&D facilities were involved in our R&D efforts.
As of December 31, 2024, approximately 1,000 dedicated R&D personnel globally in 12 R&D facilities were involved in our R&D efforts.
Of our issued patents, approximately 84% will expire within the next 10 years and the remaining approximately 16% will expire thereafter. Within the next three years, the following number of U.S. patents held by us is set to expire: approximately 30 patents in 2024, approximately 29 patents in 2025 and approximately 23 patents in 2026.
Of our issued patents, approximately 78% will expire within the next 10 years and the remaining approximately 22% will expire thereafter. Within the next three years, the following number of U.S. patents held by us is set to expire: approximately 23 patents in 2025, approximately 23 patents in 2026 and approximately 36 patents in 2027.
Sales and Marketing We sell our portfolio of products and services through direct sales forces and independent distributors depending on specific market and product needs. Our global business sells and distributes products in approximately 100 countries. Our footprint is bolstered by a global commercial team of approximately 4,250 employees.
“Risk Factors” of this Form 10-K for additional information. 11 Sales and Marketing We sell our portfolio of products and services through direct sales forces and independent distributors depending on specific market and product needs. Our global business sells and distributes products in approximately 100 countries. Our footprint is bolstered by a global commercial team of approximately 4,300 employees.
For a discussion of these risks, see Item 1A. “Risk Factors” of this Form 10-K. See Note 22, “SEGMENT INFORMATION” to our audited Consolidated Financial Statements for revenues and long-lived assets by geographic area. Available Information Our Internet address is www.bausch.com .
Changes in the relative values of currencies may materially affect our results of operations. For a discussion of these risks, see Item 1A. “Risk Factors” of this Form 10-K. See Note 21, “SEGMENT INFORMATION” to our audited Consolidated Financial Statements for revenues and long-lived assets by geographic area. Available Information Our Internet address is www.bausch.com .
In international markets, we market Yellox TM (bromfenac ophthalmic solution, 0.9%) which is indicated for the treatment of postoperative ocular inflammation following cataract extraction. • Lotemax ® Suspension (loteprednol etabonate ophthalmic suspension, 0.5%) is a topical corticosteroid indicated for the treatment of steroid responsive inflammatory conditions of the palpebral and bulbar conjunctiva, cornea, and anterior segment of the globe and for the treatment of post-operative inflammation following ocular surgery. • Alrex ® (loteprednol etabonate ophthalmic suspension, 0.2%) is indicated for the temporary relief of the signs and symptoms of seasonal allergic conjunctivitis. 4 • Zylet ® (loteprednol etabonate 0.5% and tobramycin 0.3% ophthalmic suspension) indicated for the steroid-responsive inflammatory ocular conditions for which a corticosteroid is indicated and where superficial bacterial ocular infection or a risk of bacterial ocular infection exists.
In international markets, we market Yellox ® (bromfenac ophthalmic solution, 0.9%) which is indicated for the treatment of postoperative ocular inflammation following cataract extraction. • Lotemax ® Suspension (loteprednol etabonate ophthalmic suspension, 0.5%) is a topical corticosteroid indicated for the treatment of steroid responsive inflammatory conditions of the palpebral and bulbar conjunctiva, cornea, and anterior segment of the globe and for the treatment of post-operative inflammation following ocular surgery. • Alrex ® (loteprednol etabonate ophthalmic suspension, 0.2%) is indicated for the temporary relief of the signs and symptoms of seasonal allergic conjunctivitis. • Zylet ® (loteprednol etabonate 0.5% and tobramycin 0.3% ophthalmic suspension) indicated for the steroid-responsive inflammatory ocular conditions for which a corticosteroid is indicated and where superficial bacterial ocular infection or a risk of bacterial ocular infection exists. 4 Surgical Our Surgical segment consists of medical device equipment, consumables and technologies for the treatment of cataracts, corneal, vitreous and retinal eye conditions, which includes IOLs and delivery systems, phacoemulsification equipment and other surgical instruments and devices necessary for ophthalmic surgery.
Initial Public Offering and Separation of the Bausch + Lomb Eye Health Business On August 6, 2020, our parent company, BHC, announced its plan to separate our eye health business into an independent publicly traded entity, separate from the remainder of BHC (the “Separation”).
On August 6, 2020, BHC announced its plan to separate our eye health business into an independent publicly traded entity, separate from the remainder of BHC (the “Separation”).
We may incur liabilities, expenses, costs and other operational losses under the GDPR and privacy laws of the applicable EU and EEA Member States and the United Kingdom in connection with any measures we take to comply with them. In addition, in China, the Personal Information Protection Law (the “PIPL”) came into force in November 2021.
We may incur liabilities, expenses, costs and other operational losses under the GDPR and privacy laws of the applicable EU and EEA Member States and the United Kingdom in connection with any measures we take to comply with them.
Employees are empowered to explore roles that are of interest and gain insights into their strengths and development needs. A variety of development programs are provided to support employees at every stage of their career and incorporate individual development plans that aim to help employees reach their career goals.
A variety of development programs are provided to support employees at every stage of their career and incorporate individual development plans that aim to help employees reach their career goals.
In addition, we are unable to predict what environmental or and occupational health and safety legislation or regulations may be proposed, adopted or enacted in the future. See Item 1A. “Risk Factors” of this Form 10-K for additional information.
In addition, we are unable to predict what environmental or and occupational health and safety legislation or regulations may be proposed, adopted or enacted in the future. See Item 1A.
Manufacturing and Supply We manufacture the significant majority of our products at 25 manufacturing facilities in 10 countries worldwide, including the United States, Ireland, China, Germany, France and Italy, with the remainder of our production assigned to high quality third-party manufacturers.
“Risk Factors” of this Form 10-K for additional information on our competition risks. 12 Manufacturing and Supply We manufacture the significant majority of our products at 23 manufacturing facilities in 10 countries worldwide, including the United States, Ireland, China, Germany, France and Italy, with the remainder of our production assigned to high quality third-party manufacturers.
Item 1. Business Bausch + Lomb Corporation (and its subsidiaries) (“Bausch + Lomb,” “we,” “us,” “our” or the “Company”) is a leading global eye health company dedicated to protecting and enhancing the gift of sight for millions of people around the world – from the moment of birth through every phase of life.
Item 1. Business Bausch + Lomb Corporation (and its subsidiaries) (“Bausch + Lomb,” “we,” “us,” “our” or the “Company”) is dedicated to protecting and enhancing the gift of sight for millions of people around the world – from the moment of birth through every phase of life. Our mission is simple, yet powerful: helping you see better, to live better.
This resulted in the initial public offering of Bausch + Lomb (the “B+L IPO”), and our common shares began trading on the New York Stock Exchange and the Toronto Stock Exchange, in each case under the ticker symbol “BLCO”, on May 6, 2022. Prior to the completion of the B+L IPO, we were an indirect wholly-owned subsidiary of BHC.
This resulted in the initial public offering of Bausch + Lomb (the “B+L IPO”), and our common shares began trading on the New York Stock Exchange (“NYSE”) and the Toronto Stock Exchange (“TSX”), in each case under the ticker symbol “BLCO”, on May 6, 2022.
Aside from the change in name, there were no other changes made to this segment at that time. Our principal Pharmaceuticals products include: • XIIDRA ® (lifitegrast ophthalmic solution) 5%, a non-steroid eye drop specifically approved to treat the signs and symptoms of dry eye disease focusing on inflammation associated with dry eye.
Our principal Pharmaceuticals products include: • XIIDRA ® (lifitegrast ophthalmic solution) 5%, a non-steroid eye drop specifically approved to treat the signs and symptoms of dry eye disease focusing on inflammation associated with dry eye.
Corporate Social Responsibility The Bausch Foundation was established to improve the lives of patients globally by providing access to safe, effective medicines and by financially supporting health care education and causes.
These programs include medical coverage, retirement benefits, paid time off and life and other insurances. 14 Corporate Social Responsibility The Bausch Foundation was established to improve the lives of patients globally by providing access to safe, effective medicines and by financially supporting health care education and causes.
Our sole focus on eye health with one of the most comprehensive portfolios in the industry enables us to reach a broad set of customers through coordinated delivery of solutions across the pharmaceutical, vision and surgical product lines. See Item 1A. “Risk Factors” of this Form 10-K for additional information on our competition risks.
The principal methods of competition for our products include quality, efficacy, market acceptance, price and marketing and promotional efforts. Our sole focus on eye health with one of the most comprehensive portfolios in the industry enables us to reach a broad set of customers through coordinated delivery of solutions across the pharmaceutical, vision and surgical product lines. See Item 1A.
In order to manage any single-sourced suppliers we maintain sufficient inventory consistent with good practice and production lead-times. We believe that the loss of any one supplier would not adversely affect our business to a significant extent. Some of our products are provided by suppliers under a private label distribution agreement.
We purchase the materials and components for each of our product categories from a wide variety of suppliers. In order to manage any single-sourced suppliers we maintain sufficient inventory consistent with good practice and production lead-times. We believe that the loss of any one supplier would not adversely affect our business to a significant extent.
All of our foreign operations are subject to risks inherent in conducting business abroad, including price and currency exchange controls, fluctuations in the relative values of currencies, political and economic instability and restrictive governmental actions including possible nationalization or expropriation. Changes in the relative values of currencies may materially affect our results of operations.
All of our foreign operations are subject to risks inherent in conducting business abroad, including compliance with multiple legal and regulatory regimes, price and currency exchange controls, fluctuations in the relative values of currencies, political and economic instability, the imposition of and adverse changes to duties, tariff and other trade protection measures and restrictive governmental actions including possible nationalization or expropriation, and our domestic operations are subject to risks including the imposition of retaliatory measures.
For example, in the EEA, the collection and use of personal data, including clinical trial data, is governed by the provisions of the General Data Protection Regulation (“GDPR”). The GDPR became effective on May 25, 2018, repealing its predecessor directive and increasing responsibility and liability of companies in relation to the processing of personal data of EU data subjects.
The GDPR became effective on May 25, 2018, repealing its predecessor directive and increasing responsibility and liability of companies in relation to the processing of personal data of EU data subjects.
Food and Drug Administration (the “FDA”) in May 2023, and Lumify ® Eye Allergy, for which we expect to submit an NDA during 2024. • Blink ® OTC product line consists of a variety of eye drops and contact lens rewetting drops designed to provide immediate and long-lasting symptom relief.
Food and Drug Administration (the “FDA”) in April 2024, began launching in the first quarter of 2025. • Blink ® OTC product line consists of a variety of eye drops and contact lens rewetting drops designed to provide immediate and long-lasting symptom relief.
We intend to leverage our global regulatory and commercial capabilities to accelerate product approvals and launches across current and future markets. • Continuous investment in our product portfolio - We continuously search for new product opportunities through internal development and through strategic licensing and acquisition opportunities, that, if successful, will allow us to leverage our commercial footprint and supplement our existing product portfolio and address specific unmet needs in the market.
We intend to leverage our global regulatory and commercial capabilities to accelerate product approvals and launches across current and future markets. • Continuous investment in our product portfolio - We continuously search for new product opportunities through internal development and through strategic licensing and acquisition opportunities, that, if successful, will allow us to leverage our commercial footprint and supplement our existing product portfolio and address specific unmet needs in the market. • Constantly optimize the way our business operates - We continuously implement and search for new ways to drive operational efficiencies and margin expansion, which includes investing in our infrastructure at our manufacturing and distribution facilities, as well as using predictive analytics to help eliminate downtime on our automated lines.
No individual customers accounted for 10% or more of our total revenue for 2023, 2022 and 2021. Competition Our competitors include specialty and other large pharmaceutical companies, medical device companies, biotechnology companies, OTC companies and generic manufacturers, in the United States, Canada, Europe, Asia, Latin America, the Middle East, Africa and in other countries in which we market our products.
Competition Our competitors include specialty and other large pharmaceutical companies, medical device companies, biotechnology companies, OTC companies and generic manufacturers, in the United States, Canada, Europe, Asia, Latin America, the Middle East, Africa and in other countries in which we market our products. The market for Bausch + Lomb products is very competitive, both across product categories and geographies.
The lens also incorporates an aspheric optical design that reduces spherical aberration. • SofLens ® Daily Disposable Contact Lenses, which use ComfortMoist ® Technology (a combination of thin lens design and moisture-rich packaging solution) and High Definition Optics™ which is an aspheric design that reduces spherical aberration over a range of powers, especially in low light.
The lens also incorporates an aspheric optical design that reduces spherical aberration. • SofLens ® Daily Disposable Contact Lenses, which use ComfortMoist TM Technology (a combination of thin lens design and moisture-rich packaging solution) and High Definition Optics™ which is an aspheric design that reduces spherical aberration over a range of powers, especially in low light. 3 Pharmaceuticals Our Pharmaceuticals segment consists of a broad line of proprietary and generic pharmaceutical products for post-operative treatments and treatments for a number of eye conditions, such as glaucoma, eye inflammation, ocular hypertension, dry eyes and retinal diseases.
Under these agreements, the supplier generally retains the intellectual property and exclusive manufacturing rights. The supplier private labels the 12 products under the Bausch + Lomb brand for sale in certain fields of use and geographic territories. These agreements may be subject to minimum purchase or sales obligations.
Some of our products are provided by suppliers under a private label distribution agreement. Under these agreements, the supplier generally retains the intellectual property and exclusive manufacturing rights. The supplier private labels the products under the Bausch + Lomb brand for sale in certain fields of use and geographic territories.
The market for Bausch + Lomb products is very competitive, both across product categories and geographies. In addition to larger diversified pharmaceutical and medical device companies, we face competition in the eye health market from mid-size and smaller, regional and entrepreneurial companies with fewer products in niche areas or regions.
In addition to larger diversified pharmaceutical and medical device companies, we face competition in the eye health market from mid-size and smaller, regional and entrepreneurial companies with fewer products in niche areas or regions. We sell a broad range of products, and competitive factors vary by product line and geographic area in which the products are sold.
Our principal contact lens products include: • SiHy Daily, a silicone hydrogel daily disposable contact lens designed to provide outstanding comfort and clear vision throughout the day. To date SiHy Daily has been launched in approximately 50 countries, under the brand names INFUSE ® , Bausch + Lomb ULTRA ® ONE DAY and AQUALOX ® ONE DAY.
Our principal contact lens products include: • SiHy Daily, a silicone hydrogel daily disposable contact lens designed to provide outstanding comfort and clear vision throughout the day.
We are also subject to extensive and evolving regulations regarding the manufacturing, processing, distribution, importing, exporting, and labeling of our products and their raw materials. In light of the rapid and ongoing global regulations and expectations relating to environmental, social and governance (“ESG”) matters, we are developing an integrated ESG program.
We are also subject to extensive and evolving regulations regarding the manufacturing, processing, distribution, importing, exporting, and labeling of our products and their raw materials.
Talent Development and Total Rewards We are committed to the development of employees and believe that our success coincides with employees’ achievements of personal and professional goals. Through our Employee Development Framework, the Company endeavors to support employees’ interests to grow to their full potential, achieve career goals and contribute to the success of the Company.
Through our Employee Development Framework, the Company endeavors to support employees’ interests to grow to their full potential, achieve career goals and contribute to the success of the Company. Employees are empowered to explore roles that are of interest and gain insights into their strengths and development needs.
We are expanding our portfolio of premium IOLs built on the enVista ® platform with enVista Aspire TM (Monofocal Plus), enVista Envy TM Trifocal and enVista Beyond TM (extended depth of focus (“EDOF”)) optical designs with two options: non-Toric and Toric for astigmatism patients. enVista Aspire TM monofocal and toric IOLs with Intermediate Optimized optics launched in the U.S. during October 2023 and we anticipate launching the Trifocal and EDOF optical designs for presbyopia in the U.S. in 2024 and 2026, respectively. • Surgical Instruments ◦ Storz ® Ophthalmic instruments are our suite of surgical instruments which include precision microsurgical instruments, diamond knives and single-use surgical instruments, as well as instruments customized for individual surgeons under the Storz ® Ophthalmic Instrument brand.
We are expanding our portfolio of premium IOLs built on the enVista ® platform with enVista Aspire ® (Monofocal Plus), enVista Envy TM Trifocal and enVista Beyond TM (extended depth of focus (“EDOF”)) optical designs with two options: non-Toric and Toric for astigmatism patients. enVista Aspire ® monofocal and toric IOLs with Intermediate Optimized optics were launched in the U.S. during October 2023 and in Europe in January 2025 and we anticipate launching in Canada in 2025. enVista Envy TM launched in Canada in June 2024 and the U.S. launch is in-process, after receiving FDA approval in October 2024.
The Company also provides competitive benefit programs based on local practice in the countries where employees work. These programs include medical coverage, retirement benefits, paid time off and life and other insurances.
The Company also provides competitive benefit programs based on local practice in the countries where employees work.
Sales in the fourth quarter tend to be higher based on consumer and customer purchasing patterns associated with health care reimbursement programs. However, there are no assurances that these historical trends will continue in the future. 14 Geographic Areas A significant portion of our revenues is generated from operations or otherwise earned outside the U.S. and Canada.
Sales in the first quarter tend to be lower as patient co-pays and deductibles reset at the beginning of each year. Sales in the fourth quarter tend to be higher based on consumer and customer purchasing patterns associated with health care reimbursement programs. However, there are no assurances that these historical trends will continue in the future.
Moreover, states have been frequently amending existing laws, requiring attention to changing regulatory requirements. Internationally, laws and regulations in many jurisdictions apply broadly to the collection, transmission, dissemination, use, privacy, confidentiality, security, retention, availability, integrity and other processing of health-related and other sensitive and personal information.
Internationally, laws and regulations in many jurisdictions apply broadly to the collection, transmission, dissemination, use, privacy, confidentiality, security, retention, availability, integrity and other processing of health-related and other sensitive and personal information. For example, in the EEA, the collection and use of personal data, including clinical trial data, is governed by the provisions of the General Data Protection Regulation (“GDPR”).
In July 2023, we acquired the Blink ® OTC product line of eye and contact lens drops from Johnson & Johnson Vision, which consists of Blink ® Tears Lubricating Eye Drops, Blink ® Tears Preservative Free Lubricating Eye Drops, Blink GelTears ® Lubricating Eye Drops, Blink ® Triple Care Lubricating Eye Drops, Blink Contacts ® Lubricating Eye Drops and Blink-N-Clean ® Lens Drops (collectively, the “Blink ® Product Line”).
In July 2023, we acquired the Blink ® OTC product line of eye and contact lens drops from Johnson & Johnson Vision, which consists of Blink ® Tears Lubricating Eye Drops, Blink ® Tears Preservative Free Lubricating Eye Drops, Blink GelTears ® Lubricating Eye Drops, Blink ® Triple Care 2 Lubricating Eye Drops, Blink Contacts ® Lubricating Eye Drops and Blink-N-Clean ® Lens Drops (collectively, the “Blink ® Product Line”). • Blink TM NutriTears ® - During June 2024, we expanded our over-the-counter dry eye portfolio with the launch of Blink TM NutriTears ® , a clinically proven OTC supplement that targets the key root causes of dry eyes, promotes healthy tear production and provides noticeable relief of eye dryness symptoms.
See Item 1A. “Risk Factors” of this Form 10-K for additional information on the risks associated with the Separation.
The Distribution is subject to the achievement of targeted debt leverage ratios and the completion of the Separation is subject to the receipt of any applicable shareholder and other necessary approvals and other factors and is subject to various risk factors. See Item 1A. “Risk Factors” of this Form 10-K for additional information on the risks associated with the Separation.
We have a significant global research, development, manufacturing and commercial footprint of approximately 13,300 employees and a presence in approximately 100 countries, extending our reach to billions of potential customers across the globe.
Founded in 1853, Bausch + Lomb has a significant global research, development, manufacturing and commercial footprint of approximately 13,500 employees and a presence in approximately 100 countries.
In 2023, our ONE by ONE and Biotrue Eye Care Recycling programs were recognized as Sustainability Award winners by Business Intelligence Group in the “Sustainability Service of the Year” category. The ONE by ONE Recycling program has collected more than 76 million used contact lenses, blister packs and top foils since the program's launch in November 2016.
The ONE by ONE Recycling program has collected more than 94 million used contact lenses, blister packs and top foils since the program's launch in November 2016. Seasonality of Business Historically, revenues from our business tend to be weighted toward the second half of the year.
To date, we have launched and acquired the right to launch Lumify ® in various countries.
To date, we have launched and acquired the right to launch Lumify ® in various countries. A new line extension formulation, Lumify ® Preservative Free, for which the New Drug Application (“NDA”) was approved by the U.S.
We believe there is significant opportunity in each of our businesses and we believe our existing portfolio, commercial footprint and pipeline of product development projects position us to build value for our investors. Segment Information Our portfolio of products fall into three operating and reportable segments: (i) Vision Care, (ii) Pharmaceuticals and (iii) Surgical.
In 1 addition, we continue to search for ways to invest in our sales execution, such as through enhancing our digital capabilities to streamline our ordering process. We believe there is significant opportunity in each of our businesses and we believe our existing portfolio, commercial footprint and pipeline of product development projects position us to build value for our investors.
Segment revenues for the years 2023, 2022 and 2021 were as follows: 2023 2022 2021 (in millions) Amount Pct. Amount Pct. Amount Pct.
Segment Information Our portfolio of products fall into three operating and reportable segments: (i) Vision Care, (ii) Pharmaceuticals and (iii) Surgical. Segment revenues for the years 2024, 2023 and 2022 were as follows: 2024 2023 2022 (in millions) Amount Pct. Amount Pct. Amount Pct.
In the 2022 employee survey, 75% of employees viewed our health care and wellness benefit programs as meeting their needs, which is significantly higher than the external norm against which we compare. 13 Diversity, Equity and Inclusion We are dedicated to fostering an inclusive work environment where everyone feels welcomed, supported and valued for their talents and contributions.
In the 2024 employee survey, 75% of employees viewed our health care and wellness benefit programs as meeting their needs, which is aligned to the results of our 2022 survey.
See Note 2, “SIGNIFICANT ACCOUNTING POLICIES” to our audited Consolidated Financial Statements for additional information. As of February 16, 2024, BHC directly or indirectly holds 310,449,643 Bausch + Lomb common shares, which represents approximately 88.4% of the issued and outstanding common shares of Bausch + Lomb.
Bausch + Lomb is a subsidiary of Bausch Health Companies Inc. (“BHC”), with BHC directly or indirectly holding 310,449,643 Bausch + Lomb common shares, which represents approximately 88.1% of the issued and outstanding common shares of Bausch + Lomb, as of February 12, 2025.
Bausch + Lomb understands that BHC continues to believe that completing the Separation makes strategic sense and that BHC continues to evaluate all relevant factors and considerations related to completing the Separation, including the effect of the lawsuit filed against Norwich Pharmaceuticals Inc.
Bausch + Lomb understands that BHC continues to believe that completing the Separation, which may include the transfer of all or a portion of BHC’s remaining direct or indirect equity interest in Bausch + Lomb to its shareholders (the “Distribution”), the monetization of all or a portion of BHC’s ownership interest in Bausch + Lomb, the sale of the Company (a “Sale Transaction”) or a combination thereof, makes strategic sense and that BHC continues to evaluate all relevant factors and considerations related to completing the Separation, including those factors described in BHC’s public filings.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeFurthermore, the Distribution (as defined below) may not occur; • The Separation is subject to challenge and could be subject to further challenges in the future, any of which could delay or prevent the consummation of such transactions or cause them to occur on worse terms than we currently expect; • We have limited history of operating as an independent company, and our historical financial information prior to the B+L IPO is not necessarily representative of the results that we would have achieved as an independent or standalone company and may not be a reliable indicator of our future results; • Until the completion of the Separation, BHC will control the direction of our business, and the concentrated ownership of our common shares will prevent you and other shareholders from influencing significant decisions; • Some of our directors and officers may have actual or potential conflicts of interest because of their equity ownership in BHC, and some of our directors may have actual or potential conflicts of interest because they also serve as directors of BHC; • Potential tax liabilities that may arise as a result of the Separation or related transactions; • Certain requirements of the public company “butterfly reorganization” rules in Section 55 of the Income Tax Act (Canada) (the “ Tax Act”) depend on events that may not be within our control; • We potentially could have received better terms from unaffiliated third parties than the terms we received in our agreements with BHC; • The potential indemnification obligations to BHC and the ability of BHC to satisfy its corresponding indemnification obligations to us; • As long as BHC owns a majority of our common shares, we may rely on certain exemptions from the corporate governance requirements of the New York Stock Exchange (“NYSE”) available to “controlled companies” and of the Toronto Stock Exchange (“TSX”) available to “majority controlled” companies; • The impact of the actual or perceived future sales of our common shares (including via the Distribution) on our common share price; • The services that BHC provides to us may not be sufficient to meet our needs; • The transfer of certain outstanding assets, liabilities and contracts relating to the Separation and any delays thereof; • Our ability to successfully develop our pipeline of products, which is highly uncertain and requires significant expenditures and time, including risks relating to obtaining necessary government approvals; 16 • Failure to comply with post-approval legal and regulatory requirements for our marketed products; • Interruptions to our manufacturing operations and those of our third-party manufacturers, including as a result of failure to comply with applicable regulations; • Certain of our products or components thereof are available from a single source or a limited number of sources; • Issues relating to inventory levels or fluctuations in buying patterns by our large distributors and retail customers and supply chain disruptions; • Failure to yield new products that achieve commercial success; • Changes in market acceptance of our products due to inadequate reimbursement for such products or otherwise. • The impact of competition and new medical and technological developments in our markets; • The loss of the services of, or our inability to recruit, retain, motivate, our executives and other key employees; • Pricing decisions, including as a result of price changes and/or new programs to enhance patient access to our products; • Failure to maintain our relationships with health care providers who recommend our products to their patients; • Our inability to control certain aspects of our third party distribution arrangements: • The impact on our revenues of our policies and programs relating to returns, allowances, chargebacks and marketing; • Risks associated with wholesaler concentration; • Acquisition and integration risks; • Potential obligations under our indemnity agreements and arrangements; • Environmental, social and governance (ESG) matters and our ability to monitor and respond appropriately; • Our indebtedness could adversely affect our business and our ability to meet our obligations; • International operations risks associated with conducting a significant portion of our business outside the United States, including with respect to foreign currency risk and the ongoing Ukraine-Russia and Israel-Hamas conflicts; • The loss of patent protection or exclusivity rights and, even where we retain patent protection or exclusivity rights, competition from similar products in the markets in which we participate; • The inability to obtain, maintain, license, enforce, defend or otherwise protect our intellectual property rights; • Breakdown, interruption or breach of our information technology systems; • Competition for our pharmaceutical, OTC products or medical devices; • The potential increase of our effective tax rates, including as a result of changes in applicable tax laws; • The impact of ongoing and potential legal and governmental proceedings, including with respect to intellectual property; • Compliance by our third party partners and service providers of their contractual, legal and regulatory obligations; • Product liability matters, including potential product recalls or voluntary market withdrawals; • Compliance with various laws and regulations, including with respect to marketing, promotional and business practices and fraud and abuse, anti-bribery, environmental and privacy and security matters; and • Enactment of new regulations or changes in existing regulations related to the health care system.
Biggest changeFurthermore, the Distribution or the Sale Transaction may not occur; • The Separation is subject to challenge and could be subject to further challenges in the future, any of which could delay or prevent the consummation of such transactions or cause them to occur on worse terms than we currently expect; • We have limited history of operating as an independent company, and our historical financial information prior to the B+L IPO is not necessarily representative of the results that we would have achieved as an independent or standalone company and may not be a reliable indicator of our future results; • Until the completion of the Separation, BHC will control the direction of our business, and the concentrated ownership of our common shares will prevent you and other shareholders from influencing significant decisions; • Some of our directors and officers may have actual or potential conflicts of interest because of their equity ownership in BHC, and some of our directors may have actual or potential conflicts of interest because they also serve as directors of BHC; • Potential tax liabilities that may arise as a result of the Separation or related transactions; • If the Distribution occurs pursuant to the public company “butterfly reorganization” rules in Section 55 of the Income Tax Act (Canada) (the “ Tax Act”), certain requirements of those rules depend on events that may not be within our control; • We potentially could have received better terms from unaffiliated third parties than the terms we received in our agreements with BHC; • The potential indemnification obligations to BHC and the ability of BHC to satisfy its corresponding indemnification obligations to us; • As long as BHC owns a majority of our common shares, we may rely on certain exemptions from the corporate governance requirements of the NYSE available to “controlled companies” and of the TSX available to “majority controlled” companies; • The impact of the actual or perceived future sales of our common shares on our common share price; • Our ability to successfully develop our pipeline of products, which is highly uncertain and requires significant expenditures and time, including risks relating to obtaining necessary government approvals; • Failure to comply with post-approval legal and regulatory requirements for our marketed products; 16 • Interruptions to our manufacturing operations and those of our third-party manufacturers, including as a result of failure to comply with applicable regulations; • Certain of our products or components thereof are available from a single source or a limited number of sources; • Issues relating to inventory levels or fluctuations in buying patterns by our large distributors and retail customers and supply chain disruptions; • Failure to yield new products that achieve commercial success; • Changes in market acceptance of our products due to inadequate reimbursement for such products or otherwise. • The impact of competition and new medical and technological developments in our markets; • The loss of the services of, or our inability to recruit, retain, motivate, our executives and other key employees; • Pricing decisions, including as a result of price changes and/or new programs to enhance patient access to our products; • Failure to maintain our relationships with health care providers who recommend our products to their patients; • Our inability to control certain aspects of our third party distribution arrangements: • The impact on our revenues of our policies and programs relating to returns, allowances, chargebacks and marketing; • Risks associated with wholesaler concentration; • Acquisition and integration risks; • Potential obligations under our indemnity agreements and arrangements; • Environmental, social and governance (ESG) matters and our ability to monitor and respond appropriately; • Our indebtedness could adversely affect our business and our ability to meet our obligations; • International operations risks associated with conducting a significant portion of our business outside the United States, including with respect to foreign currency risk and the ongoing Ukraine-Russia conflict and Middle East conflict involving Israel, Hamas and other countries and militant groups in the region; • The loss of patent protection or exclusivity rights and, even where we retain patent protection or exclusivity rights, competition from similar products in the markets in which we participate; • The inability to obtain, maintain, license, enforce, defend or otherwise protect our intellectual property rights; • Breakdown, interruption or breach of our information technology systems; • Competition for our pharmaceutical, OTC products or medical devices; • The potential increase of our effective tax rates, including as a result of changes in applicable tax laws; • The impact of potential imposition of and adverse changes to duties, tariffs and other trade protection measures (including any retaliations to such measures); • The impact of ongoing and potential legal and governmental proceedings, including with respect to intellectual property; • Compliance by our third party partners and service providers of their contractual, legal and regulatory obligations; • Product liability matters, including potential product recalls or voluntary market withdrawals; • Compliance with various laws and regulations, including with respect to marketing, promotional and business practices and fraud and abuse, anti-bribery, environmental and privacy and security matters; and • Enactment of new regulations or changes in existing regulations related to the health care system.
However, BHC has no obligation to complete the Distribution on the terms that have been previously disclosed or at all, and it will have the ability to unilaterally terminate the Distribution Arrangement Agreement in its sole discretion at any time before the Distribution Arrangement is implemented, and Bausch + Lomb may terminate the Distribution Arrangement Agreement in accordance with its terms as of the outside date of December 31, 2024 (unless the parties otherwise agree).
However, BHC has no obligation to complete the Distribution on the terms that have been previously disclosed or at all, and it will have the ability to unilaterally terminate the Distribution Arrangement Agreement in its sole discretion at any time before the Distribution Arrangement is implemented, and, as of the outside date of December 31, 2024, Bausch + Lomb may terminate the Distribution Arrangement Agreement in accordance with its terms (unless the parties otherwise agree).
The liquidity of our common shares and/or debt securities in the market may be constrained for as long as BHC continues to hold a significant position in our common shares and/or debt securities. A lack of liquidity in our common shares and/or debt securities could depress the price of our common shares.
The liquidity of our common shares and/or debt securities in the market may be constrained for as long as BHC continues to hold a significant position in our common shares and/or debt securities. A lack of liquidity in our common shares and/or debt securities could depress the price of our common shares and/or debt securities.
Changes in government regulations or private third-party payors’ reimbursement policies may reduce reimbursement for our products. In addition, such third-party payors may otherwise make the decision to reduce reimbursement of some or all our products or fail to cover some or all our products in such programs or assert that reimbursements were not in accordance with applicable requirements.
Changes in government regulations or private third-party payors’ reimbursement policies may reduce reimbursement for our products. In addition, such third-party payors may otherwise make the decision to reduce reimbursement of some or all of our products or fail to cover some or all of our products in such programs or assert that reimbursements were not in accordance with applicable requirements.
As long as BHC controls the majority of the voting power of our outstanding common shares, except where Canadian law requires that a matter be determined by a majority of the votes cast by minority shareholders and excludes BHC from the 21 minority for that purpose, BHC will generally be able to control, whether directly or indirectly through its ability to remove and elect directors, and subject to applicable law, substantially all matters affecting us, including: • any determination with respect to our business direction and policies, including the election and removal of directors and the appointment and removal of officers; • any determinations with respect to mergers, amalgamations, business combinations or dispositions of assets; • our financing and dividend policy, and the payment of dividends on our common shares, if any; • compensation and benefit programs and other human resources policy decisions; • changes to any other agreements that may adversely affect us; and • determinations with respect to our tax returns and other tax matters.
As long as BHC controls the majority of the voting power of our outstanding common shares, except where Canadian law requires that a matter be determined by a majority of the votes cast by minority shareholders and excludes BHC from the minority for that purpose, BHC will generally be able to control, whether directly or indirectly through its ability to remove and elect directors, and subject to applicable law, substantially all matters affecting us, including: • any determination with respect to our business direction and policies, including the election and removal of directors and the appointment and removal of officers; • any determinations with respect to mergers, amalgamations, business combinations or dispositions of assets; • our financing and dividend policy, and the payment of dividends on our common shares, if any; • compensation and benefit programs and other human resources policy decisions; • changes to any other agreements that may adversely affect us; and • determinations with respect to our tax returns and other tax matters.
If the Distribution were to be effected pursuant to the public company “butterfly reorganization” rules in Section 55 of the Tax Act as BHC initially anticipated, the Company and BHC would recognize a taxable gain on the completion of the Distribution if (a) within three years of completing the Distribution, we engage in a subsequent spin-off or split-up transaction under Section 55 of the Tax Act or BHC engages in a split-up (but not spin-off) transaction under Section 55 of the Tax Act, (b) a “specified shareholder” as defined for purposes of the “butterfly reorganization” rules in Section 55 of the Tax Act disposes of our shares or shares of BHC, or property that derives 10% or more of its value from such shares and an unrelated person or a partnership acquires such property or property substituted therefor as part of the “series of transactions” which includes the Distribution; (c) there is an acquisition of control of the Company or BHC that is part of the “series of transactions” that includes the Distribution; or (d) certain persons acquire shares in our capital (other than in specified permitted transactions) in contemplation of, and as part of the “series of transactions” that includes, the Distribution.
If the Distribution were to be effected pursuant to the public company “butterfly reorganization” rules in Section 55 of the Tax Act as BHC initially anticipated, the Company and BHC would recognize a taxable gain on the completion of the Distribution if (a) within three years of completing the Distribution, we engage in a subsequent spin-off or split-up transaction under Section 55 of the Tax Act or BHC engages in a split-up (but not spin-off) transaction under Section 55 of the Tax Act, (b) a “specified shareholder” as defined for purposes of the “butterfly reorganization” rules in Section 55 of the Tax Act disposes of our shares or shares of BHC, or property that derives 10% or more of its value from such shares and an 23 unrelated person or a partnership acquires such property or property substituted therefor as part of the “series of transactions” which includes the Distribution; (c) there is an acquisition of control of the Company or BHC that is part of the “series of transactions” that includes the Distribution; or (d) certain persons acquire shares in our capital (other than in specified permitted transactions) in contemplation of, and as part of the “series of transactions” that includes, the Distribution.
Levels of market acceptance for our new products could be impacted by several factors, some of which are not within our control, including but not limited to the following: • safety, efficacy, convenience and cost-effectiveness of our products compared to the products of our competitors; • scope of approved uses and marketing approval; • availability of patent or regulatory exclusivity; • timing of market approvals and market entry; 30 • ongoing regulatory obligations following approval, such as the requirement to conduct Risk Evaluation and Mitigation Strategy (“REMS”) programs; • any restrictions or “black box” warnings required on the labeling of such products; • availability of alternative products from our competitors; • acceptance of the price of our products; • effectiveness of our sales forces and promotional efforts; • the level of reimbursement of our products; • acceptance of our products on government and private formularies; • ability to market our products effectively at the retail level or in the appropriate setting of care; and • the reputation of our products.
Levels of market acceptance for our new products could be impacted by several factors, some of which are not within our control, including but not limited to the following: • safety, efficacy, convenience and cost-effectiveness of our products compared to the products of our competitors; • scope of approved uses and marketing approval; • availability of patent or regulatory exclusivity; • timing of market approvals and market entry; • ongoing regulatory obligations following approval, such as the requirement to conduct Risk Evaluation and Mitigation Strategy (“REMS”) programs; • any restrictions or “black box” warnings required on the labeling of such products; • availability of alternative products from our competitors; • acceptance of the price of our products; • effectiveness of our sales forces and promotional efforts; • the level of reimbursement of our products; • acceptance of our products on government and private formularies; • ability to market our products effectively at the retail level or in the appropriate setting of care; and • the reputation of our products.
Our failure or that of our contract manufacturers to comply with cGMP regulations, quality system management requirements or similar regulations outside of the United States, or compliance with environmental laws or regulations, could result in enforcement action by the FDA or its foreign counterparts, or other regulatory bodies, including, but not limited to, warning letters, fines, injunctions, civil or criminal penalties, recall or seizure of products, total or partial suspension of production or importation, suspension or withdrawal of regulatory approval for approved or in-market products, refusal of the government to renew marketing applications or approve pending applications or supplements, refusal of certificates for export to foreign jurisdictions, suspension of ongoing clinical trials, imposition of new manufacturing requirements, closure of facilities and criminal prosecution.
Our failure or that of our contract manufacturers to comply with cGMP regulations, quality system management requirements or similar regulations outside of the United States, or compliance with environmental laws or regulations, could result in enforcement action by the FDA or its foreign counterparts, or other regulatory bodies, including, but not limited to, warning letters, fines, injunctions, civil or criminal penalties, recall or seizure of products, total or partial suspension of production or importation, suspension or withdrawal of regulatory approval for approved or in-market products, refusal of the government to renew marketing applications or 28 approve pending applications or supplements, refusal of certificates for export to foreign jurisdictions, suspension of ongoing clinical trials, imposition of new manufacturing requirements, closure of facilities and criminal prosecution.
In particular, such historical financial information included in this Form 10-K is not necessarily indicative of our future results of operations, financial condition or cash flows primarily because of the following factors, among others: • Prior to the B+L IPO, our business had been operated by BHC as part of its broader corporate organization, rather than as an independent company; BHC or one of its affiliates provided support for various corporate functions for us, such as information technology, compensation and benefits, human resources, engineering, finance and internal audit. 20 • Our historical financial results prior to the B+L IPO reflect the direct, indirect and allocated costs for such services historically provided by BHC.
In particular, such historical financial information included in this Form 10-K is not necessarily indicative of our future results of operations, financial condition or cash flows primarily because of the following factors, among others: • Prior to the B+L IPO, our business had been operated by BHC as part of its broader corporate organization, rather than as an independent company; BHC or one of its affiliates provided support for various corporate functions for us, such as information technology, compensation and benefits, human resources, engineering, finance and internal audit. • Our historical financial results prior to the B+L IPO reflect the direct, indirect and allocated costs for such services historically provided by BHC.
Similarly, any sale of any of our common shares by BHC will constitute a “control distribution” under Canadian securities laws (generally a sale by a person or a group of persons holding more than 20% of our outstanding voting securities) and will be subject to restrictions under Canadian securities laws, unless the sale is qualified under a prospectus filed with Canadian securities regulatory authorities, is made pursuant to a prospectus exemption, or if prior notice of the sale is filed with the Canadian securities regulatory authorities at least seven days before any sale and there has been compliance with certain other requirements and restrictions regarding the manner of sale, payment of commissions, reporting and availability of current public information about us and compliance with applicable Canadian securities laws.
Similarly, any sale of any of our common shares by BHC will constitute a “control distribution” under Canadian securities laws (generally a sale by a person or a group of persons holding more than 20% of our outstanding voting securities) and will be subject to restrictions under Canadian securities laws, unless the sale is qualified under a prospectus filed with Canadian securities regulatory authorities, is made pursuant to a prospectus exemption, or if prior notice of the sale is filed with the Canadian securities regulatory authorities at least seven days before any sale and there has been compliance with certain other 25 requirements and restrictions regarding the manner of sale, payment of commissions, reporting and availability of current public information about us and compliance with applicable Canadian securities laws.
If certain approvals and consents are not received prior to the anticipated effective date of the Distribution, we and BHC may decide to proceed nonetheless, or we and BHC may either delay or amend the implementation of all or part of the Distribution, including possibly delaying the 19 completion of the Distribution in order to allow sufficient time to complete such matters or effecting the Distribution other than by way of a plan of arrangement under applicable corporate law (such as through a reduction of capital).
If certain approvals and consents are not received prior to the anticipated effective date of the Distribution, we and BHC may decide to proceed nonetheless, or we and BHC may either delay or amend the implementation of all or part of the Distribution, including possibly delaying the completion of the Distribution in order to allow sufficient time to complete such matters or effecting the Distribution other than by way of a plan of arrangement under applicable corporate law (such as through a reduction of capital).
These laws require data controllers to implement stringent operational requirements, including, for example, transparent and expanded disclosure to data subjects about how their personal data is collected and processed, grant rights for data subjects to access, delete or object to the processing of their data, mandatory data breach notification requirements (and in certain cases, affected individuals), set limitations on retention of information and outline significant documentary requirements to demonstrate compliance through policies, procedures, training and audits.
These laws require data controllers to implement stringent operational requirements, including, for example, transparent and expanded disclosure to data subjects about how their personal data is collected and processed, grant rights for data subjects to access, delete or object to the processing of their data, mandatory data breach notification requirements (and in certain cases, affected individuals), set limitations on retention of information and outline significant 48 documentary requirements to demonstrate compliance through policies, procedures, training and audits.
As long as BHC controls a majority of the voting power of our issued and outstanding common shares with respect to a particular matter, it will generally be able to determine the outcome of all corporate actions requiring shareholder approval (as further described below) and will be able to block a takeover bid made for the shares of the Company as Canadian securities laws require that a minimum of 50% of the issued and outstanding shares be tendered to the bid in order for the bid to succeed.
As long as BHC controls a majority of the voting power of our issued and outstanding common shares with respect to a particular matter, it will generally be able to determine the outcome of all corporate actions requiring shareholder approval (as further described below) and will be able to block a takeover bid made for the shares of the Company as Canadian securities laws require that a minimum of 50% of the issued and outstanding shares be tendered to the bid in order for the bid 21 to succeed.
We may not achieve these and other anticipated benefits for a variety of reasons, including, among others: • the Separation has required significant amounts of management’s time and effort and may continue to require management’s further time and effort, which may divert management’s attention from operating and growing our business; • as a result of the Separation, we may be more susceptible to economic downturns and other adverse events than if we were still a part of BHC; • following the B+L IPO, we commenced operating as an independent company and, as a result, our business is less diversified than BHC’s business prior to the completion of the B+L IPO; 18 • our business has and may continue to experience a loss of scale and purchasing power and access to certain financial, managerial and professional resources from which we have benefited at lower cost in the past; • the other actions required to complete the Separation could disrupt our operations; and • the development of our operations and infrastructure in connection with the Separation, and any future expansion of such operations and infrastructure, may not be entirely successful, and may strain our operations and increase our operating expenses.
We may not achieve these and other anticipated benefits for a variety of reasons, including, among others: • the Separation has required significant amounts of management’s time and effort and may continue to require management’s further time and effort, which may divert management’s attention from operating and growing our business; • as a result of the Separation, we may be more susceptible to economic downturns and other adverse events than if we were still a part of BHC; • following the B+L IPO, we commenced operating as an independent company and, as a result, our business is less diversified than BHC’s business prior to the completion of the B+L IPO; 18 • our business has and may continue to experience a loss of scale and purchasing power and access to certain financial, managerial and professional resources from which we have benefited at lower cost in the past; • the manner and terms of the Separation; • the other actions required to complete the Separation could disrupt our operations; and • the development of our operations and infrastructure in connection with the Separation, and any future expansion of such operations and infrastructure, may not be entirely successful, and may strain our operations and increase our operating expenses.
There are rapid and ongoing developments and changing expectations relating to ESG matters and factors such as the impact of our operations on climate change, water and waste management, our practices relating to sustainability and product stewardship, product safety, access to health care and affordable drugs, management of business ethics and human capital development, which may result in increased regulatory, social or other scrutiny on us.
There are rapid and ongoing developments and regulations and changing expectations relating to ESG matters and factors such as the impact of our operations on climate change, water and waste management, our practices relating to sustainability and product stewardship, product safety, access to health care and affordable drugs, management of business ethics and human capital development, which may result in increased regulatory, social or other scrutiny on us.
If we are in violation of any of these requirements or any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business, including the imposition of significant criminal and civil fines and penalties, exclusion from federal health care programs or other sanctions, including consent orders or corporate integrity agreements.
If we are in violation of any of these requirements or any such actions are instituted against us, and we are not successful in defending ourselves or asserting our rights, those actions could have a significant impact on our business, including the imposition of significant criminal and civil 47 fines and penalties, exclusion from federal health care programs or other sanctions, including consent orders or corporate integrity agreements.
In addition, the FDA and Health Canada approval must be obtained in the U.S. and Canada, respectively, EMA approval (drugs) and CE Marking (devices) and/or registration under the European Commission’s Medical Device Regulation (“MDR”) 2017/745 must be obtained in countries in the EU and similar approvals must be obtained from comparable agencies in other countries, prior to marketing or manufacturing new pharmaceutical and medical device products for use by humans.
In addition, the FDA and Health Canada approval must be obtained in the U.S. and Canada, respectively, EMA approval (drugs) and CE Marking (devices) and/or registration under the European Commission’s Medical Device Regulation 2017/745 must be obtained in countries in the EU and similar approvals must be obtained from comparable agencies in other countries, prior to marketing or manufacturing new pharmaceutical and medical device products for use by humans.
The Inclusive Framework agreement must now be implemented by the OECD Members who have agreed to the plan, effective in 2024. Many members of the Inclusive Framework have either introduced or announced their intention to introduce certain components of the global minimum tax in line with the model rules for fiscal year beginning on or after December 31, 2023.
The Inclusive Framework agreement must be implemented by the OECD Members who have agreed to the plan, effective in 2024. Many members of the Inclusive Framework have either introduced or announced their intention to introduce certain components of the global minimum tax in line with the model rules for fiscal year beginning on or after December 31, 2023.
The withdrawal of a product following complaints and/or incurring significant costs, including the requirement to pay substantial damages in personal injury cases or product liability cases, could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares and/or debt securities to decline.
The withdrawal of a product following complaints and/or incurring significant costs, including the requirement to pay substantial damages in personal injury cases or product liability cases, could have a material adverse 46 effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares and/or debt securities to decline.
Any negative impact on economic conditions and international markets, continued volatility or deterioration in the debt and equity capital markets, inflation, deflation or other adverse economic conditions may adversely affect our business, liquidity, financial condition, cash flows and results of operations and could cause the market value of our common shares and/or debt securities to decline.
Any negative impact on economic conditions and international markets, continued volatility or deterioration in the debt and equity capital markets, heightened inflation, deflation or other adverse economic conditions may adversely affect our business, liquidity, financial condition, cash flows and results of operations and could cause the market value of our common shares and/or debt securities to decline.
If we are found to infringe, misappropriate or otherwise violate the intellectual property rights of others, we could lose our right to develop, manufacture or sell products, including our generic products, or could be required to pay monetary damages or royalties to license proprietary rights from third parties, which could be substantial and include treble damages if we are found to willfully infringe intellectual property rights or others.
If we are found to infringe, misappropriate or otherwise violate the intellectual property rights of others, we could lose our right to develop, manufacture or sell products, including our generic products, or could be required to pay monetary damages or royalties to license proprietary rights from third parties, which could be substantial and include treble damages if we are found to willfully infringe intellectual property 40 rights or others.
Under the MDR, several transitional measures apply to medical devices that are certified under the MDD or AIMDD prior to May 26, 2021 or, for class I device, for which a declaration of conformity was drawn up prior to May 26, 2021, allowing these devices to be placed on the market after May 26, 2021 under certain conditions for a transitional period.
Under the EU MDR, several transitional measures apply to medical devices that are certified under the MDD or AIMDD prior to May 26, 2021 or, for class I device, for which a declaration of conformity was drawn up prior to May 26, 2021, allowing these devices to be placed on the market after May 26, 2021 under certain conditions for a transitional period.
Finally, these acquisitions and other arrangements, even if successfully integrated, may fail to further our business strategy as anticipated or to achieve anticipated benefits and success, expose us to increased competition or challenges with respect to our products or geographic markets, and expose us to additional liabilities associated with an acquired business, product, technology or other asset or arrangement.
Finally, these acquisitions and other arrangements, even if successfully integrated, may fail to further our business strategy as anticipated or to achieve anticipated benefits and success, expose us to increased competition or challenges with 34 respect to our products or geographic markets, and expose us to additional liabilities associated with an acquired business, product, technology or other asset or arrangement.
There can be no assurance that these agreements will be self-executing or otherwise provide meaningful protection for our trade secrets or other intellectual property or proprietary information. These agreements may not effectively prevent disclosure or 40 misappropriation of such information and disputes may still arise with respect to the ownership of intellectual property.
There can be no assurance that these agreements will be self-executing or otherwise provide meaningful protection for our trade secrets or other intellectual property or proprietary information. These agreements may not effectively prevent disclosure or misappropriation of such information and disputes may still arise with respect to the ownership of intellectual property.
Some of the risks we face include: • Current market and economic conditions in one or more of our markets could impact our ability to grow our business; • Inflation could materially adversely affect out business and operations; • We may not realize the anticipated benefits from the Separation, and the Separation could harm our business; • The Separation is subject to certain uncertainties.
Some of the risks we face include: • Current market and economic conditions in one or more of our markets could impact our ability to grow our business; • Inflation could materially adversely affect our business and operations; • We may not realize the anticipated benefits from the Separation, and the Separation could harm our business; • The Separation is subject to certain uncertainties.
Any reduction or elimination of such reimbursement or coverage could result in a negative impact on the utilization of our products and, as a result, could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares and/or debt securities to decline.
Any reduction or elimination of such reimbursement or coverage could result in a negative 31 impact on the utilization of our products and, as a result, could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares and/or debt securities to decline.
Our ability to respond to these competitive pressures will depend on our ability to decrease our costs and maintain gross margins and operating results and to introduce new products successfully and on a timely basis, and to achieve manufacturing efficiencies and sufficient manufacturing capacity and capabilities for such products. Tax- and Accounting-related Risks Our effective tax rates may increase.
Our ability to respond to these competitive pressures will depend on our ability to 43 decrease our costs and maintain gross margins and operating results and to introduce new products successfully and on a timely basis, and to achieve manufacturing efficiencies and sufficient manufacturing capacity and capabilities for such products. Tax- and Accounting-related Risks Our effective tax rates may increase.
If BHC proceeds with the Distribution pursuant to the Distribution Arrangement, at the hearing for the Final Order, the Supreme Court of British Columbia would consider whether to approve the Distribution based on the applicable legal requirements and the evidence and submissions before the Court as to, among other things, whether the Distribution Plan of Arrangement is fair and reasonable.
If BHC proceeds with the Distribution 19 pursuant to the Distribution Arrangement, at the hearing for the Final Order, the Supreme Court of British Columbia would consider whether to approve the Distribution based on the applicable legal requirements and the evidence and submissions before the Court as to, among other things, whether the Distribution Plan of Arrangement is fair and reasonable.
The registering entity will then register each of the devices for which they are responsible for placing on the market in the UK, whether in Great Britain or Northern Ireland, as required by the UM MDR 2002. This may create added expense and challenges as explained below.
The registering entity will then register each of the 27 devices for which they are responsible for placing on the market in the UK, whether in Great Britain or Northern Ireland, as required by the UM MDR 2002. This may create added expense and challenges as explained below.
The disruption to, or suspension of, our business and operations in Russia, Belarus and Ukraine would adversely impact our business, financial condition, cash flows and results of operations in this region which may, in turn, materially adversely impact our overall business, financial condition, cash flows and results of operations, which impact 38 could be material, and could cause the market value of our common shares and/or debt securities to decline.
The disruption to, or suspension of, our business and operations in Russia, Belarus and Ukraine would adversely impact our business, financial condition, cash flows and results of operations in this region which may, in turn, materially adversely impact our overall business, financial condition, cash flows and results of operations, which impact could be material, and could cause the market value of our common shares and/or debt securities to decline.
Certain of our products are the subject of third-party distribution or sublicense agreements, pursuant to which we may manufacture and sell products to other companies, which distribute such products in return for a royalty or a supply price, in both cases which are often based on net sales.
Certain of our products are the subject of third-party distribution or sublicense agreements, pursuant to which we may manufacture and sell products to other companies, which distribute such products in return for a royalty or a supply price, in 33 both cases which are often based on net sales.
Risks Relating to Intellectual Property and Exclusivity The expiration or loss of patent protection or regulatory exclusivity rights for our key products could adversely impact our business. In addition, we have faced competition in the past and expect to face additional competition in the future, including with respect to our products that have patent protection or exclusivity rights.
Risks Relating to Intellectual Property and Exclusivity 39 The expiration or loss of patent protection or regulatory exclusivity rights for our key products could adversely impact our business. In addition, we have faced competition in the past and expect to face additional competition in the future, including with respect to our products that have patent protection or exclusivity rights.
Furthermore, from time to time, changes to the applicable legislation, regulations or policies may be introduced that change these review and approval processes for our products, which changes may make it more difficult and costly to obtain or maintain regulatory approvals. Our marketed products will be subject to ongoing regulatory review.
Furthermore, from time to time, changes to the applicable legislation, regulations or 26 policies may be introduced that change these review and approval processes for our products, which changes may make it more difficult and costly to obtain or maintain regulatory approvals. Our marketed products will be subject to ongoing regulatory review.
However, if we make any significant changes in the design or intended purpose of our devices, they will no longer benefit from such transitional periods. Generally, the MDR imposes stricter requirements on manufacturers, importers and distributors of medical devices.
However, if we make any significant changes in the design or intended purpose of our devices, they will no longer benefit from such transitional periods. Generally, the EU MDR imposes stricter requirements on manufacturers, importers and distributors of medical devices.
Moreover, the requirements to provide clinical data for medical devices has become stricter and as a result we may need to conduct new time consuming and costly clinical investigations with our existing medical devices to meet the new requirements, including to obtain CE certificates under the MDR.
Moreover, the requirements to provide clinical data for medical devices has become stricter and as a result we may need to conduct new time consuming and costly clinical investigations with our existing medical devices to meet the new requirements, including to obtain CE certificates under the EU MDR.
While we have been successful in launching some of our products, we may not achieve the same level of success with respect to all of our new products, and we may face additional challenges associated with operating as an independent company following the completion of the Separation.
While we have been successful in launching some of our products, we may not achieve the same level of success with respect to all of our new products, and we may face additional challenges associated with operating as an independent company following the 30 completion of the Separation.
Also our compliance requirements extend to other current good practices with which we must comply and adhere to with respect to the development and commercialization of our products and medical devices, including not only cGMP, but also Current Good Laboratory Practices (“cGLP”), Current Good Clinical Practices (“cGLP”) and Current Good Distribution Practices (“cGDP”).
Also our compliance requirements extend to other current good practices with which we must comply and adhere to with respect to the development and commercialization of our products and medical devices, including not only cGMP, but also Current Good Laboratory Practices (“cGLP”), Current Good Clinical Practices (“cGCP”) and Current Good Distribution Practices (“cGDP”).
We could experience substantial production delays or inventory shortages in the event of any such occurrence until we or 28 they repair such equipment or facility or we or they build or locate replacement equipment or a replacement facility, as applicable, and seek to obtain necessary regulatory approvals for such replacement.
We could experience substantial production delays or inventory shortages in the event of any such occurrence until we or they repair such equipment or facility or we or they build or locate replacement equipment or a replacement facility, as applicable, and seek to obtain necessary regulatory approvals for such replacement.
In addition, incidents of adverse drug reactions, unintended side effects or misuse relating to our products could result in additional regulatory controls or restrictions, or even lead to the regulatory authority requiring us to recall or withdraw the 27 product from the market.
In addition, incidents of adverse drug reactions, unintended side effects or misuse relating to our products could result in additional regulatory controls or restrictions, or even lead to the regulatory authority requiring us to recall or withdraw the product from the market.
These legal and administrative proceedings will remain with BHC and will be controlled by BHC, but the Company will share in applicable future liabilities, should any result from these proceedings. These proceedings are complex and extended and occupy the resources of our management and employees.
These legal and administrative 45 proceedings will remain with BHC and will be controlled by BHC, but the Company will share in applicable future liabilities, should any result from these proceedings. These proceedings are complex and extended and occupy the resources of our management and employees.
Such 47 events may result in governmental enforcement actions and prosecutions, private litigation, fines and penalties or adverse publicity, and could cause customers and business partners to lose trust in us, which could have an adverse effect on our reputation and business.
Such events may result in governmental enforcement actions and prosecutions, private litigation, fines and penalties or adverse publicity, and could cause customers and business partners to lose trust in us, which could have an adverse effect on our reputation and business.
If we fail to adequately forecast demand for any new or existing product, or fail to determine the appropriate product mix for production purposes, we may 29 face production capacity issues in manufacturing sufficient quantities of a given product.
If we fail to adequately forecast demand for any new or existing product, or fail to determine the appropriate product mix for production purposes, we may face production capacity issues in manufacturing sufficient quantities of a given product.
See Note 5, “FAIR VALUE MEASUREMENTS” and Note 8, “INTANGIBLE ASSETS AND GOODWILL” to our audited Consolidated Financial Statements included elsewhere in this 10-K for further information on these impairment charges.
See Note 5, “FAIR VALUE MEASUREMENTS” and Note 8, “INTANGIBLE ASSETS AND GOODWILL” to our audited Consolidated Financial Statements included elsewhere in this Form 10-K for further information on these impairment charges.
These restrictions or limitations are or may be imposed contractually (such as through our contracts with group purchasing organizations or others), through legislation (such as the new Inflation Reduction Act, which, among other things, requires manufacturers to pay rebates to Medicare if prices increase faster than inflation for products used by Medicare beneficiaries) or through decisions or commitments we decide to make ourselves (such as through the pricing committees we have established or may establish for certain of our businesses).
These restrictions or limitations are or may be imposed contractually (such as through our contracts with group purchasing organizations or others), through legislation (such as the Inflation Reduction Act, which, among other things, currently requires manufacturers to pay rebates to Medicare if prices increase faster than inflation for products used by Medicare beneficiaries) or through decisions or commitments we decide to make ourselves (such as through the pricing committees we have established or may establish for certain of our businesses).
If incurred, tax liabilities could have a material effect on our financial position. We potentially could have received better terms from unaffiliated third parties than the terms we received in our agreements with BHC.
If incurred, tax liabilities could have a material effect on our financial position. 24 We potentially could have received better terms from unaffiliated third parties than the terms we received in our agreements with BHC.
We cannot provide assurance that current sanctions or potential future changes in these sanctions or other measures will not have a material impact on our operations in Russia, Belarus and Ukraine.
In addition, we cannot provide assurance that current sanctions or potential future changes in these sanctions or other measures will not have a material impact on our operations in Russia, Belarus and Ukraine.
The Revolving Credit Facility also contains financial covenants that: (1) prior to the IG Trigger (as defined herein), require us to, if, as of the last day of any fiscal quarter (commencing with the fiscal quarter ending December 31, 2022), loans under the Revolving Credit Facility and swingline loans are outstanding in an aggregate amount greater than 40% of the total commitments in respect of the Revolving Credit Facility at such time, maintain a maximum first lien net leverage ratio of not greater than 4.50:1.00 and (2) after the IG Trigger, require us to, as of the last day of each fiscal quarter ending after the IG Trigger, (a) maintain a total leverage ratio of not greater than 4.00:1.00 (provided that such ratio will increase to 4.50:1.00 in connection with certain acquisitions for the four fiscal quarter period commencing with the quarter in which such acquisition is consummated) and (b) maintain an interest coverage ratio of not less than 3.00:1.00.
The Revolving Credit Facility contains financial covenants (the “Revolving Facility Financial Covenant”) that: (1) prior to the IG Trigger (as defined herein), require us to, if, as of the last day of any fiscal quarter (commencing with the fiscal quarter ending December 31, 2022), loans under the Revolving Credit Facility and swingline loans are outstanding in an aggregate amount greater than 40% of the total commitments in respect of the Revolving Credit Facility at such time, maintain a maximum first lien net leverage ratio of not greater than 4.50:1.00 and (2) after the IG Trigger, require us to, as of the last day of each fiscal quarter ending after the IG Trigger, (a) maintain a total leverage ratio of not greater than 4.00:1.00 (provided that such ratio will increase to 4.50:1.00 in connection with certain acquisitions for the four fiscal quarter period commencing with the quarter in which such acquisition is consummated) and (b) maintain an interest coverage ratio of not less than 3.00:1.00.
Our ability to effectively monitor and respond to the rapid and ongoing developments and expectations relating to environmental, social and governance (“ESG”) matters, including related social expectations and concerns, may impose unexpected costs or result in reputational or other harm that could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares and/or debt securities to decline.
Our ability to effectively monitor and respond to the rapid and ongoing developments and expectations relating to environmental, social and governance (“ESG”) matters, including related social expectations and concerns, have imposed (and may continue to impose) unexpected costs and/or may result in reputational or other harm that could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares and/or debt securities to decline.
Furthermore, the Distribution may not occur.” In addition, in order to preserve the tax-free treatment of the Distribution, if effected, for U.S. federal income tax purposes, we will be restricted from taking certain actions, including, during the two-year period after the Distribution, discontinuing the active conduct of our trade or business, merging or amalgamating with any other person (other than in connection with the Distribution), redeeming or otherwise acquiring our shares (other than pursuant to certain open-market repurchases of less than 20% of our common shares, in the aggregate), soliciting, participating or supporting any acquisition of our shares by any person or business combination having a similar effect, or otherwise taking any action that could 23 reasonably be expected to adversely affect the tax-free treatment of the Distribution for U.S. federal income tax purposes.
Furthermore, the Distribution or the Sale Transaction may not occur.” In addition, in order to preserve the tax-free treatment of the Distribution, if effected, for U.S. federal income tax purposes, we will be restricted from taking certain actions, including, during the two-year period after the Distribution, discontinuing the active conduct of our trade or business, merging or amalgamating with any other person (other than in connection with the Distribution), redeeming or otherwise acquiring our shares (other than pursuant to certain open-market repurchases of less than 20% of our common shares, in the aggregate), soliciting, participating or supporting any acquisition of our shares by any person or business combination having a similar effect, or otherwise taking any action that could reasonably be expected to adversely affect the tax-free treatment of the Distribution for U.S. federal income tax purposes.
In addition, these third-party manufacturers may have the ability to increase the supply price payable by us for the manufacture and supply of our products, in some cases without our consent.
In addition, these third-party manufacturers may 29 have the ability to increase the supply price payable by us for the manufacture and supply of our products, in some cases without our consent.
Defending against or settling such claims and any unfavorable legal decisions, settlements or orders could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares and/or debt securities to decline. See Note 20, “LEGAL PROCEEDINGS” to our audited Consolidated Financial Statements for additional information.
Defending against or settling such claims and any unfavorable legal decisions, settlements or orders could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares and/or debt securities to decline. See Note 19, “LEGAL PROCEEDINGS” to our audited Consolidated Financial Statements for additional information.
Complying with these rules and regulations has and will substantially increase our legal and financial compliance costs and make some activities more time-consuming and costly. • In addition, as a public company, our management is required to conduct an annual evaluation of our internal controls over financial reporting and include a report of management on our internal controls in our annual reports on Form 10-K, commencing with this Form 10-K.
Complying with these rules and regulations has and will substantially increase our legal and financial compliance costs and make some activities more time-consuming and costly. • In addition, as a public company, our management is required to conduct an annual evaluation of our internal controls over financial reporting and include a report of management on our internal controls in our annual reports on Form 10-K.
We may, or may not, be able to provide this data in time to obtain MDR certifications in a timely fashion when our existing certificates expire.
We may, or may not, be able to provide this data in time to obtain EU MDR certifications in a timely fashion when our existing certificates expire.
For example, with respect to some of our largest or most significant products, the supply of the finished product for each of our Lumify ® , Vyzulta ® , SofLens ® , MIEBO ® , XIIDRA ® and PureVision ® products are only available from a single source, the supply of the active pharmaceutical ingredients (“API”) or other components for our Vyzulta ® , MIEBO ® and PreserVision ® products are also only available from a single source and certain of our Biotrue ® , Softlens ® and Ultra ® contact lens products are also only available from a single source.
For example, with respect to some of our largest or most significant products, the supply of the finished product for each of our Lumify ® , Vyzulta ® , SofLens ® , MIEBO ® , XIIDRA ® and PureVision ® products are only available from a single source, the supply of the active pharmaceutical ingredients (“API”) or other components for our Lumify ® , Vyzulta ® , MIEBO ® and PreserVision ® products are also only available from a single source and certain of our Biotrue ® , Softlens ® and Bausch + Lomb Ultra ® contact lens products are also only available from a single source.
In a higher inflationary environment, we may be unable to raise the prices of our products and services sufficiently to keep up with the rate of inflation. Moreover, negative macroeconomic conditions could adversely impact our ability to obtain financing in the future on terms acceptable to us, or at all.
In a heightened inflationary environment, we may be unable to raise the prices of our products and services sufficiently to keep up with the rate of inflation. Moreover, negative macroeconomic conditions could adversely impact our ability to obtain financing in the future on terms acceptable to us, or at all.
The following events or occurrences, among others, could cause fluctuations in our financial performance and/or the market price of our common shares and/or debt securities from period to period: • development and launch of new competitive products; • the timing and receipt of regulatory approvals or lack of approvals; • costs related to business development transactions; • changes in the amount we spend to promote our products; 51 • delays between our expenditures to acquire new products, technologies or businesses and the generation of revenues from those acquired products, technologies or businesses; • changes in treatment practices of health care and eye care professionals that currently prescribe certain of our products; • increases in the cost of raw materials used to manufacture our products; • actions by the FDA or other regulatory bodies relating to our manufacturers; • manufacturing and supply interruptions; • our responses to price competition; • new legislation that would control or regulate the prices of drugs; • a protracted and wide-ranging trade conflict between the United States and China; • expenditures as a result of legal actions (and settlements thereof), including the defense of our patents and other intellectual property; • market acceptance of our products; • the timing of wholesaler and distributor purchases and success of our wholesaler and distributor arrangements; • general economic and industry conditions, including potential fluctuations in interest rates; • changes in seasonality of demand for certain of our products; • foreign currency exchange rate fluctuations; • changes to, or the confidence in, our business strategy; • changes to, or the confidence in, our management; and • expectations for future growth.
The following events or occurrences, among others, could cause fluctuations in our financial performance and/or the market price of our common shares and/or debt securities from period to period: • development and launch of new competitive products; • the timing and receipt of regulatory approvals or lack of approvals; • costs related to business development transactions; • changes in the amount we spend to promote our products; • delays between our expenditures to acquire new products, technologies or businesses and the generation of revenues from those acquired products, technologies or businesses; 52 • changes in treatment practices of health care and eye care professionals that currently prescribe certain of our products; • increases in the cost of raw materials used to manufacture our products; • actions by the FDA or other regulatory bodies relating to our manufacturers; • manufacturing and supply interruptions; • our responses to price competition; • new legislation that would control or regulate the prices of drugs; • protracted and wide-ranging trade conflicts, including between the United States and China, Canada, Mexico and other countries; • expenditures as a result of legal actions (and settlements thereof), including the defense of our patents and other intellectual property; • market acceptance of our products; • the timing of wholesaler and distributor purchases and success of our wholesaler and distributor arrangements; • general economic and industry conditions, including potential fluctuations in interest rates; • changes in seasonality of demand for certain of our products; • foreign currency exchange rate fluctuations; • changes to, or the confidence in, our business strategy; • changes to, or the confidence in, our management; and • expectations for future growth.
If we are unable to adequately recognize and respond to such developments and governmental, societal, investor and consumer expectations relating to such 35 ESG matters, we may miss corporate opportunities, become subject to additional scrutiny, incur unexpected costs or experience damage to our reputation or our various brands.
However, if we are unable to adequately recognize and respond to such developments and governmental, societal, investor and consumer expectations relating to such ESG matters, we may miss corporate opportunities, become subject to additional scrutiny, incur unexpected costs or experience damage to our reputation or our various brands.
The Company conducted its annual goodwill impairment test as of October 1, 2023. No impairment to the goodwill of any reporting unit was identified. If market conditions deteriorate, or if the Company is unable to execute its strategies, it may be necessary to record impairment charges in the future.
The Company conducted its annual goodwill impairment test as of October 1, 2024. No impairment to the goodwill of any reporting unit was identified. If market conditions deteriorate, or if the Company is unable to execute its strategies, it may be necessary to record impairment charges in the future.
In addition, we could, in the future, face additional legal proceedings and investigations and inquiries by governmental agencies relating to these or similar matters. For more information regarding legal proceedings, see Note 20, “LEGAL PROCEEDINGS” to our audited Consolidated Financial Statements.
In addition, we could, in the future, face additional legal proceedings and investigations and inquiries by governmental agencies relating to these or similar matters. For more information regarding legal proceedings, see Note 19, “LEGAL PROCEEDINGS” to our audited Consolidated Financial Statements.
Additional sanctions or other measures may be imposed by the global community, and counteractive measures may be taken by the Russian government, other entities in Russia or governments or other entities outside of Russia. In 2023, we derived approximately 3% of our revenues from sales of our products in Russia, Ukraine and Belarus.
Additional sanctions or other measures may be imposed by the global community, and counteractive measures may be taken by the Russian government, other entities in Russia or governments or other entities outside of Russia. In 2024, we derived approximately 3% of our revenues from sales of our products in Russia, Ukraine and Belarus.
A failure to maintain these relationships or poor performance by these third parties could negatively impact our 45 business.
A failure to maintain these relationships or poor performance by these third parties could negatively impact our business.
B HC informed us in the past that it intended to conduct the Distribution by way of a statutory plan of arrangement under applicable corporate law (the “ Distribution Arrangement”) to be implemented in accordance with the terms and subject to the conditions set out in the plan of arrangement (the “ Distribution Plan of Arrangement”) appended to the Arrangement Agreement entered into between Bausch + Lomb and BHC (the “ Distribution Arrangement Agreement”).
If a Distribution is to occur, B HC informed us in the past that it intended to conduct the Distribution by way of a statutory plan of arrangement under applicable corporate law (the “ Distribution Arrangement”) to be implemented in accordance with the terms and subject to the conditions set out in the plan of arrangement (the “ Distribution Plan of Arrangement”) appended to the Arrangement Agreement entered into between Bausch + Lomb and BHC (the “ Distribution Arrangement Agreement”).
We cannot provide any assurances with respect to the accuracy of our assumptions, including our assumptions with respect to future revenues of the XIIDRA ® products or assumptions regarding our ability to successfully develop and obtain regulatory approval for the acquired pipeline assets.
We cannot provide any assurances with respect to the accuracy of our assumptions, including our assumptions with respect to future revenues of the business or products or assumptions regarding our ability to successfully develop and obtain regulatory approval for any acquired pipeline assets.
Following the B+L IPO, BHC continues to provide some of these services to us on a transitional basis, pursuant to a transition services agreement that we entered into with BHC in connection with the Separation.
Following the B+L IPO, BHC continued to provide some of these services to us on a transitional basis, pursuant to a transition services agreement that we entered into with BHC in connection with the Separation.
As a consequence, beginning in June 2021 through May 2022, we have been required to appoint an authorized representative in Switzerland in order to export our CE-marked medical devices to Switzerland. Additionally, the name and address of the Swiss authorized representative must be placed on the packaging. This has created added expenses and challenges.
As a consequence, beginning in June 2021, we have been required to appoint an authorized representative in Switzerland in order to export our CE-marked medical devices to Switzerland. Additionally, the name and address of the Swiss authorized representative must be placed on the packaging. This has created added expenses and challenges.
The applicability of these restrictions and the extent and nature of any indemnity obligations will depend on the manner in which the Distribution is ultimately effected, including whether or not the Distribution is effected pursuant to the public company “butterfly reorganization” rules of the Tax Act, which may be outside of our control.
The applicability of these restrictions and the extent and nature of any indemnity obligations will depend on the manner in which the Distribution is ultimately effected (if at all), including whether or not the Distribution is effected pursuant to the public company “butterfly reorganization” rules of the Tax Act, which may be outside of our control.
BHC’s interests may not be the same as, or may conflict with, our interests or the interests of our other shareholders Because BHC’s interests may differ from ours or from those of our other shareholders, actions that BHC takes with respect to us, as our controlling shareholder and pursuant to its rights under the MSA, may not be favorable to us or our other securityholders.
Because BHC’s interests may differ from ours or from those of our other shareholders and other stakeholders, actions that BHC takes with respect to us, as our controlling shareholder and pursuant to its rights under the MSA, may not be favorable to us or our other securityholders and stakeholders.
These inflationary pressures and other negative macroeconomic conditions could impact our revenues and resulting margins and could have an adverse impact on results of operations and could cause the market value of our common shares and/or debt securities to decline.
These inflationary pressures and other negative macroeconomic conditions (including the potential impact of tariffs) could impact our revenues and resulting margins and could have an adverse impact on results of operations and could cause the market value of our common shares and/or debt securities to decline.
If our products are not included within an adequate number of formularies or adequate reimbursement levels are not provided, or if those policies increasingly favor generic products, this could have a material adverse effect on our business, financial condition, cash flows and results of operations or result in additional pricing pressure on our products and could cause the market value of our common shares and/or debt securities to decline. 31 Catastrophic events may disrupt our business.
If our products are not included within an adequate number of formularies or adequate reimbursement levels are not provided, or if those policies increasingly favor generic products, this could have a material adverse effect on our business, financial condition, cash flows and results of operations or result in additional pricing pressure on our products and could cause the market value of our common shares and/or debt securities to decline.
All of our foreign operations are subject to risks inherent in conducting business abroad, including, among other things: • difficulties in coordinating and managing foreign operations, including ensuring that foreign operations comply with foreign laws as well as Canadian and U.S. laws applicable to Canadian companies with U.S. and foreign operations, such as export and sanctions laws and the FCPA, the Canadian Corruption of Foreign Public Officials Act and other applicable worldwide anti-bribery laws; • price and currency exchange controls; • restrictions on the repatriation of funds; • scarcity of hard currency, including the U.S. dollar, which may require a transfer or loan of funds to the operations in such countries, which they may not be able to repay on a timely basis; • political and economic instability; • ongoing uncertainties as a result of instability or changes in geopolitical conditions, including military or political conflicts, such as those caused by the ongoing conflicts between Russia and Ukraine or Israel and Hamas (the potential escalation or geographic expansion of which could heighten other risks identified elsewhere in this “Risk Factors” section); • compliance with multiple regulatory regimes; • compliance with economic sanctions laws and other laws that apply to our activities in the countries where we operate; • less established legal and regulatory regimes in certain jurisdictions, including as relates to enforcement of anti-bribery and anti-corruption laws and the reliability of the judicial systems; • differing degrees of protection for intellectual property; • unexpected changes in foreign regulatory requirements, including quality standards and other certification requirements; • new export license requirements; • adverse changes in tariff and trade protection measures; • differing labor regulations; • potentially negative consequences from changes in or interpretations of tax laws; • restrictive governmental actions; • possible nationalization or expropriation; • credit market uncertainty; • restrictions on business activities and other challenges associated with pandemics, including the lingering COVID-19 pandemic, epidemics, outbreaks of an infectious disease or similar events; • differing local practices, customs and cultures, some of which may not align or comply with our Company practices and policies or U.S. laws and regulations; • difficulties with licensees, contract counterparties, or other commercial partners; and • differing local product preferences and product requirements.
All of our foreign operations are subject to risks inherent in conducting business abroad, including, among other things: • difficulties in coordinating and managing foreign operations, including ensuring that foreign operations comply with foreign laws as well as Canadian and U.S. laws applicable to Canadian companies with U.S. and foreign operations, such as export and sanctions laws and the FCPA, the Canadian Corruption of Foreign Public Officials Act and other applicable worldwide anti-bribery laws; • price and currency exchange controls; • restrictions on the repatriation of funds; • scarcity of hard currency, including the U.S. dollar, which may require a transfer or loan of funds to the operations in such countries, which they may not be able to repay on a timely basis; • political and economic instability; • ongoing uncertainties as a result of instability or changes in geopolitical conditions, including military or political conflicts, such as those caused by the ongoing conflict between Russia and Ukraine or the conflict in the Middle East involving Israel, Hamas and other countries and militant groups in the region (the potential escalation or geographic expansion of which could heighten other risks identified elsewhere in this “Risk Factors” section); • compliance with multiple regulatory regimes; • compliance with economic sanctions laws and other laws that apply to our activities in the countries where we operate; • less established legal and regulatory regimes in certain jurisdictions, including as relates to enforcement of anti-bribery and anti-corruption laws and the reliability of the judicial systems; • differing degrees of protection for intellectual property; • unexpected changes in foreign regulatory requirements, including quality standards and other certification requirements; • new export license requirements; • adverse changes in tariff and trade protection measures, especially in light of recent comments made by the new Trump administration; • differing labor regulations; • potentially negative consequences from changes in or interpretations of tax laws; • restrictive governmental actions; • possible nationalization or expropriation; • credit market uncertainty; • restrictions on business activities and other challenges associated with pandemics, epidemics, outbreaks of an infectious disease or similar events; • differing local practices, customs and cultures, some of which may not align or comply with our Company practices and policies or U.S. laws and regulations; • difficulties with licensees, contract counterparties, or other commercial partners; and • differing local product preferences and product requirements.
Risks Relating to Information Technology We have become increasingly dependent on information technology systems and infrastructure and any breakdown, interruption, breach or other compromise of our information technology systems or those of our third party service providers could subject us to liability or interrupt the operation of our business, which could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares and/or debt securities to decline.
Any of the foregoing events would harm our business, financial condition, results of operations and prospects and could cause the market value of our common shares and/or debt securities to decline. 41 Risks Relating to Information Technology We have become increasingly dependent on information technology systems and infrastructure and any breakdown, interruption, breach or other compromise of our information technology systems or those of our third party service providers could subject us to liability or interrupt the operation of our business, which could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares and/or debt securities to decline.
If impairment exists, we would be required to take an impairment charge with respect to the impaired asset. 44 For example, in 2023, 2022 and 2021, we recognized impairments to finite-lived and indefinite-lived intangible assets of less than $1 million, $1 million and $12 million, respectively. These asset impairments were primarily attributable to the discontinuance of certain product lines.
If impairment exists, we would be required to take an impairment charge with respect to the impaired asset. For example, in 2024, 2023 and 2022, we recognized impairments to finite-lived and indefinite-lived intangible assets of $5 million, less than $1 million and $1 million, respectively. These asset impairments were primarily attributable to the discontinuance of certain product lines.
In April 2017, the European Union adopted MDR, which repeals and replaces the Medical Device Directive (“MDD”) and active implantable medical devices Directive (“AIMDD”) 90/385/EEC. The MDR, for most parts, became applicable on May 26, 2021.
In April 2017, the European Union adopted the European Medical Device Regulations (“EU MDR”), which repeals and replaces the Medical Device Directive (“MDD”) and active implantable medical devices Directive (“AIMDD”) 90/385/EEC. The EU MDR, for most parts, became applicable on May 26, 2021.
Potential difficulties that may be encountered in the integration process include the 34 following: integrating personnel (such as the XIIDRA salesforce brought on as part of the XIIDRA Acquisition), operations and systems, while maintaining focus on selling and promoting existing and newly-acquired products; coordinating geographically dispersed organizations; distracting management and employees from operations; retaining existing customers and attracting new customers; maintaining the business relationships the acquired company has established, including with health care providers; and managing inefficiencies associated with integrating the operations of the Company and the acquired business, product or other assets.
Potential difficulties that may be encountered in the integration process include the following: integrating personnel, operations and systems, while maintaining focus on selling and promoting existing and newly-acquired products; coordinating geographically dispersed organizations; distracting management and employees from operations; retaining existing customers and attracting new customers; maintaining the business relationships the acquired company has established, including with health care providers; and managing inefficiencies associated with integrating the operations of the Company and the acquired business, product or other assets.
De Schutter, Brett Icahn and Gary Hu are “independent directors” within the meaning of applicable regulatory and stock exchange requirements in the United States and within the meaning of Canadian securities regulations, certain of them have served and, in some cases, continue to serve, as directors of BHC.
Ling, Brett Icahn and Gary Hu are “independent directors” within the meaning of applicable regulatory and stock exchange requirements in the United States and within the meaning of Canadian securities laws, certain of them have served and, in some cases, continue to serve, as directors of BHC.
Additional unanticipated costs may be incurred in the integration of the acquired business with our business. In addition, as was the case with the XIIDRA Acquisition, we may also incur additional indebtedness to finance the transaction, which indebtedness may be material and may limit our operating or financial flexibility relative to our then current position.
Additional unanticipated costs may be incurred in the integration of the acquired business with our business. In addition, we may also incur additional indebtedness to finance the transaction, which indebtedness may be material and may limit our operating or financial flexibility relative to our then current position.
The indenture governing the October 2028 Secured Notes also contains negative covenants and events of default that are similar to those contained in the Credit Facilities (as defined herein).
The indenture governing the October 2028 Secured Notes also contains negative covenants and events of default that are similar to those contained in the Senior Secured Credit Facilities.
At the end of this transition period, we will need to perform these functions ourselves or hire third parties to perform these functions on our behalf, and these costs may differ significantly from the comparable expenses we have incurred in the past. • Prior to the B+L IPO, our working capital requirements and capital expenditures historically were satisfied as part of BHC’s corporate-wide cash management and centralized funding programs, and our cost of debt and other capital may significantly differ from the historical amounts reflected in our historical financial statements. • Prior to the B+L IPO, our business was integrated with that of BHC and we benefited from BHC’s size and scale in costs, employees and vendor and customer relationships.
As these transitional services expire or are terminated (as most now have), we will need to perform these functions ourselves or hire third parties to perform these functions on our behalf, and these costs may differ significantly from the comparable expenses we have incurred in the past. • Prior to the B+L IPO, our working capital requirements and capital expenditures historically were satisfied as part of BHC’s corporate-wide cash management and centralized funding programs, and our cost of debt and other capital may significantly differ from the historical amounts reflected in our historical financial statements. • Prior to the B+L IPO, our business was integrated with that of BHC and we benefited from BHC’s size and scale in costs, employees and vendor and customer relationships.
On August 4, 2023, Canada released draft legislation to enact certain components of the pillar two proposals into Canadian law as the Global Minimum Tax Act (“GMTA”). The GMTA is generally aligned with the model rules proposed by the OECD and is expected to become effective for fiscal years beginning on or after December 31, 2023.
On August 4, 2023, Canada released draft legislation to enact certain components of the pillar two proposals into Canadian law as the Global Minimum Tax Act (“GMTA”), which was enacted on June 20, 2024. The GMTA is generally aligned with the model rules proposed by the OECD and is effective for fiscal years beginning on or after December 31, 2023.
We are increasingly dependent upon our information technology systems and infrastructure, as well as those of third parties with whom we interact, and internal and public internet sites, data hosting and processing facilities, cloud-based services and hardware, social media sites and mobile technology, in connection with the conduct of our business. 41 We must constantly update our information technology systems and infrastructure and undertake investments in new information technology systems and infrastructure.
We are increasingly dependent upon our information technology systems and infrastructure, as well as those of third parties with whom we interact, and internal and public internet sites, data hosting and processing facilities, cloud-based services and hardware, social media sites and mobile technology, in connection with the conduct of our business.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeWhen a cybersecurity threat or incident is identified, the Cybersecurity and Risk Management Team will perform a technical investigation which typically consists of the following phases: i. Detection, which includes identifying the threat or incident, gathering all available facts surrounding the matter and performing an initial analysis to determine its level of severity.
Biggest changeDetection, which includes identifying the threat or incident, gathering all available facts surrounding the matter and performing an initial analysis to determine its level of severity. If the incident is classified as “Severity 1,” the Materiality Committee, as defined below, is notified to further assess the matter. ii.
The Company emphasizes continuous risk evaluation and mitigation to improve the Cybersecurity Risk Management Program’s resilience and instill a culture of vigilance across the Company's business.
The Company emphasizes continuous risk evaluation and mitigation to improve the Cybersecurity Risk Management Program’s resilience and to instill a culture of vigilance across the Company's business.
For more information about these risks, please see “Risk Factors—Risks Relating to Information Technology—We have become increasingly dependent on information technology systems and infrastructure and any breakdown, interruption, breach or other compromise of our information technology systems or those of our third party service providers could subject us to liability or interrupt the operation of our business, which could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares to decline” under Item 1A of this Annual Report Form 10-K.
For more information about these risks, please see “Risk Factors—Risks Relating to Information Technology—We have become increasingly dependent on information technology systems and infrastructure and any breakdown, interruption, breach or other compromise of our information technology systems or those of our third party service providers could subject us to liability or interrupt the operation of our business, which could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares to decline” under Item 1A of this Annual Report on Form 10-K.
As noted above, the Company has in place the following teams who are responsible for maintaining various phases of the Cybersecurity Risk Management Program: • Cybersecurity and Risk Management Team which is led by the VP, IT Security and Risk Management, who reports directly to the Chief Information Officer (“CIO”).
As noted above, the Company has in place the following teams who are responsible for maintaining various phases of the Cybersecurity Risk Management Program: • Cybersecurity and Risk Management Team which is led by the VP, IT Security and Risk Management, who reports directly to the interim Chief Information Officer (“CIO”).
The Company’s VP, IT Security and Risk Management and CIO who collectively lead our Cybersecurity and Risk Management Team have relevant degrees and certifications in Information Technology and Security and have extensive experience in their current and prior roles related to IT Security.
The Company’s VP, IT Security and Risk Management and interim CIO, who collectively lead our Cybersecurity and Risk Management Team, have relevant degrees and certifications in Information Technology and Security and have extensive experience in their current and prior roles related to IT Security.
This program, which is an integral part of our overall enterprise risk management program, implements controls and frameworks designed to align with industry best practices, including those based on the National Institute of Standards and Technology Cybersecurity Framework, the Sarbanes-Oxley Act of 2002 and HIPPA.
This program, which is an integral part of our overall enterprise risk management program, implements controls and frameworks designed to align with industry best practices, including those based on the National Institute of Standards and Technology Cybersecurity Framework, the Sarbanes-Oxley Act of 2002 and HIPAA.
The Cybersecurity and Risk Management Team is overseen by: 53 (i) the Executive Committee, which consists of, among others, the CEO, Chief Financial Officer, Chief Legal Officer and Chief Compliance and Privacy Officer, and (ii) the Audit Committee.
The Cybersecurity and Risk Management Team is overseen by: (i) the Executive Committee, which consists of, among others, the Chief Executive Officer, Chief Financial Officer, Chief Legal Officer and Chief Compliance and Privacy Officer, and (ii) the Audit Committee.
Along with leading the Company’s cybersecurity learning and awareness trainings, they also regularly participate in various third-party industry conferences and trainings. 54
Along with leading the Company’s cybersecurity learning and awareness trainings, they also regularly participate in various third-party industry conferences and trainings. 55
The Cybersecurity and Risk Management Team is responsible for maintaining and carrying out the Cybersecurity Risk Management Program. • Materiality Committee, which is led by the CIO, Controller and Chief Accounting Officer, and Deputy General Counsel.
The 54 Cybersecurity and Risk Management Team is responsible for maintaining and carrying out the Cybersecurity Risk Management Program. • Materiality Committee, which is led by the interim CIO, Controller and Chief Accounting Officer, and SVP, Assistant General Counsel.
The Cybersecurity and Risk Management Team, as described below, is responsible for the operationalization of the Company's cybersecurity practices, which consists of, but are not limited to: (i) updating and enhancing the Cybersecurity 52 Risk Management Program, (ii) overseeing third-party assessors, consultants, auditors, and other experts, and (iii) assessing, identifying, managing and addressing potential threats or incidents.
The Cybersecurity and Risk Management Team, as described below, is responsible for the operationalization of the Company's cybersecurity practices, which consists of, but are not limited to: (i) updating and enhancing the Cybersecurity Risk Management Program, (ii) overseeing third-party assessors, consultants, auditors, and other experts, and (iii) assessing, identifying, managing and addressing potential threats or incidents. 53 When a cybersecurity threat or incident is identified, the Cybersecurity and Risk Management Team will perform a technical investigation which typically consists of the following phases: i.
Recovery, which includes repairing the impacted systems, and if applicable, notifying and instructing impacted parties of next steps. iv. Post-Incident, which includes issuing a report summarizing the threat or incident, and the steps taken in assessing and eliminating the threat, as well as steps to implement to attempt to prevent similar future incidents.
Post-Incident, which includes issuing a report summarizing the threat or incident, and the steps taken in assessing and eliminating the threat, as well as steps to implement to attempt to prevent similar future incidents.
If the incident is classified as “Severity 1,” the Materiality Committee, as defined below, is notified to further assess the matter. ii. Containment and Eradication, which includes determining the cause and vulnerabilities so that the threat or incident can be isolated and eliminated. iii.
Containment and Eradication, which includes determining the cause and vulnerabilities so that the threat or incident can be isolated and eliminated. iii. Recovery, which includes repairing the impacted systems, and if applicable, notifying and instructing impacted parties of next steps. iv.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeLouis, Missouri Offices, R&D and manufacturing facility Surgical Owned 140,000 Macherio, Italy Offices, manufacturing and warehouse facility Vision Care Owned 119,000 Clearwater, Florida R&D and manufacturing facility Surgical Owned 102,000 Beijing, China Manufacturing facility Vision Care Owned 97,000 Item 3. Legal Proceedings See Note 20, “LEGAL PROCEEDINGS” to our audited Consolidated Financial Statements for details on legal proceedings. Item 4.
Biggest changeLouis, Missouri Offices, R&D and manufacturing facility Surgical Owned 140,000 Macherio, Italy Offices, manufacturing and warehouse facility Vision Care Owned 119,000 Clearwater, Florida R&D and manufacturing facility Surgical Owned 102,000 Beijing, China Manufacturing facility Vision Care Owned 97,000 Eppelheim, Germany Manufacturing facility Surgical Leased 78,000 Item 3.
The following are our principal properties, including the segments of our business that use each property: Location Purpose Segment Owned or Leased Approximate Square Footage Vaughan, Ontario, Canada Corporate headquarters and distribution facility All Segments Leased 66,000 Bridgewater, New Jersey Administration shared with BHC All Segments Leased 310,000 Rochester, New York Offices, R&D and manufacturing facility Pharmaceuticals + Vision Care Owned 953,000 Waterford, Ireland R&D and manufacturing facility Vision Care Owned 500,000 Woodruff, South Carolina Distribution facility Vision Care Leased 432,000 Jinan, China Offices and manufacturing facility Pharmaceuticals + Vision Care Owned 418,000 Berlin, Germany R&D, manufacturing, distribution and office facility Pharmaceuticals Owned 339,000 Greenville, South Carolina Manufacturing facility Vision Care Owned 314,000 Lynchburg, Virginia Offices and distribution facility Vision Care Owned 224,000 Tampa, Florida R&D and manufacturing facility Pharmaceuticals Owned 171,000 Aubenas, France Offices, manufacturing and warehouse facility Pharmaceuticals Owned 148,000 St.
The following are our principal properties, including the segments of our business that use each property: Location Purpose Segment Owned or Leased Approximate Square Footage Vaughan, Ontario, Canada Corporate headquarters and distribution facility All Segments Leased 66,000 Bridgewater, New Jersey Administration shared with BHC All Segments Leased 310,000 Rochester, New York Offices, R&D and manufacturing facility Pharmaceuticals + Vision Care Owned 953,000 Waterford, Ireland R&D and manufacturing facility Vision Care Owned 500,000 Woodruff, South Carolina Distribution facility Vision Care Leased 432,000 Jinan, China Offices and manufacturing facility Pharmaceuticals + Vision Care Owned 418,000 Berlin, Germany R&D, manufacturing, distribution and office facility Pharmaceuticals Owned 339,000 Greenville, South Carolina Manufacturing facility Vision Care Owned 314,000 Lynchburg, Virginia Offices and distribution facility Vision Care Owned 224,000 Aubenas, France Offices, manufacturing and warehouse facility Pharmaceuticals Owned 193,000 Tampa, Florida R&D and manufacturing facility Pharmaceuticals Owned 171,000 St.
Added
Legal Proceedings See Note 19, “LEGAL PROCEEDINGS” to our audited Consolidated Financial Statements for details on legal proceedings. Item 4. Mine Safety Disclosures None. 56 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe graph assumes that the value of the investment in our common shares, in each index, and in the peer groups (including reinvestment of dividends) was $100 on May 6, 2022 and tracks it through December 31, 2023. 5/6/22 6/22 9/22 12/22 3/23 6/23 9/23 12/23 Bausch + Lomb Corp $100.00 $76.20 $76.70 $77.55 $87.05 $100.35 $84.75 $85.30 S&P 500 $100.00 $91.91 $87.43 $94.04 $101.09 $109.92 $106.33 $118.76 S&P/TSX Composite $100.00 $91.35 $90.06 $95.43 $99.78 $100.87 $98.65 $106.64 2022 Peer Group $100.00 $95.90 $87.86 $96.72 $104.33 $109.18 $92.93 $104.57 2023 Peer Group $100.00 $95.94 $87.44 $96.41 $103.60 $108.18 $92.08 $103.30 Dividends Since the B+L IPO, no dividends have been declared or paid.
Biggest changeThe graph assumes that the value of the investment in our common shares, in each index, and in the peer groups (including reinvestment of dividends) was $100 on May 6, 2022 and tracks it through December 31, 2024. 5/6/22 12/31/22 12/31/23 12/31/24 Bausch + Lomb Corp $100.00 $77.55 $85.30 $90.30 S&P 500 $100.00 $94.04 $118.76 $148.47 S&P/TSX Composite $100.00 $95.43 $106.64 $129.73 2023 Peer Group $100.00 $96.44 $103.31 $93.45 2024 Peer Group $100.00 $99.38 $100.36 $93.86 Dividends Since the B+L IPO, no dividends have been declared or paid.
Treaty may generally be entitled 58 to claim benefits under the U.S. Treaty in respect of income, profits or gains derived through the LLC. Residents of the United States should consult their own tax advisors with respect to their eligibility for benefits under the U.S. Treaty. This summary is based upon the current provisions of the U.S.
Treaty may generally be entitled to claim benefits under the U.S. Treaty in respect of income, profits or gains derived through the LLC. Residents of the United States should consult their own tax advisors with respect to their eligibility for benefits under the U.S. Treaty. This summary is based upon the current provisions of the U.S.
The 2023 peer group therefore consists of a customized peer group of fifteen companies that includes: Agilent Technologies Inc, Alcon Inc., Align Technology Inc, The Cooper Companies Inc, Dentsply Sirona Inc, Dexcom Inc, Edwards Lifesciences Corp, Hologic Inc, Jazz Pharmaceuticals Plc, Organon & Co., Perrigo Company Plc, Resmed Inc, Teleflex Inc, Zimmer Biomet Holdings Inc and Zoetis Inc.
The 2023 peer group consists of a customized peer group of fifteen companies that includes: Agilent Technologies Inc, Alcon Inc., Align Technology Inc, The Cooper Companies Inc, Dentsply Sirona Inc, Dexcom Inc, Edwards Lifesciences Corp, Hologic Inc, Jazz Pharmaceuticals Plc, Organon & Co., Perrigo Company Plc, Resmed Inc, Teleflex Inc, Zimmer Biomet Holdings Inc and Zoetis Inc.
Treaty includes limitation on benefits rules that restrict the ability of certain persons who are resident in the United States to claim any or all benefits under the U.S. Treaty. Furthermore, limited liability companies (“LLCs”) that are not taxed as corporations pursuant to the provisions of the U.S.
Treaty includes limitation on benefits rules that restrict the ability of certain persons who are resident in the United States to claim any or all benefits under the U.S. Treaty. Furthermore, limited liability companies (“LLCs”) that are 59 not taxed as corporations pursuant to the provisions of the U.S.
Where an investment is determined to be injurious to national security, Cabinet can prohibit closing or, if closed, can order the investor to divest control. Short of a prohibition or divestment order, Cabinet can impose terms or conditions on the investment or can require the investor to provide binding undertakings to address the national security concern.
Where an investment is determined to be injurious to national security, Cabinet can prohibit closing or, if closed, can order the investor to divest control. Short of a prohibition or divestment order, Cabinet can impose terms or conditions on the investment or the Minister can require the investor to provide binding undertakings to address the national security concern.
While our Board of Directors will review our dividend policy periodically, we currently do not intend to pay any cash dividends in the foreseeable future. 57 Restrictions on Share Ownership by Non-Canadians There are no limitations under the laws of Canada or in our organizational documents on the right of foreigners to hold or vote securities of our Company, except that the Investment Canada Act (Canada) (the “Investment Canada Act”) may require review and approval by the Minister of Innovation, Science and Industry(Canada) (the “Minister”) of an acquisition of “control” of our Company by a “non-Canadian”.
While our Board of Directors will review our dividend policy periodically, we currently do not intend to pay any cash dividends in the foreseeable future. 58 Restrictions on Share Ownership by Non-Canadians There are no limitations under the laws of Canada or in our organizational documents on the right of foreigners to hold or vote securities of our Company, except that the Investment Canada Act (Canada) (the “Investment Canada Act”) may require review and approval by the Minister of Innovation, Science and Industry(Canada) (the “Minister”) of an acquisition of “control” of our Company by a “non-Canadian”.
Securities Authorized for Issuance under Equity Compensation Plans Information required under this Item will be included in our definitive proxy statement for the 2024 Annual Meeting of Shareholders expected to be filed with the SEC no later than 120 days after the end of the fiscal year covered by this Form 10-K (the “2024 Proxy Statement”), and such required information is incorporated herein by reference.
Securities Authorized for Issuance under Equity Compensation Plans Information required under this Item will be included in our definitive proxy statement for the 2025 Annual Meeting of Shareholders expected to be filed with the SEC no later than 120 days after the end of the fiscal year covered by this Form 10-K (the “2025 Proxy Statement”), and such required information is incorporated herein by reference.
Holders The approximate number of holders of record of our common shares as of February 16, 2024 was 4. 56 Performance Graph The graph below matches the cumulative total return of holders of Bausch + Lomb Corporation's common shares with the cumulative total returns of the: (i) S&P 500 index, (ii) the S&P/TSX Composite index, (iii) a 2022 peer group of companies and (iv) a 2023 peer group of companies.
Holders The approximate number of holders of record of our common shares as of February 12, 2025 was 4. 57 Performance Graph The graph below matches the cumulative total return of holders of Bausch + Lomb Corporation's common shares with the cumulative total returns of the: (i) S&P 500 index, (ii) the S&P/TSX Composite index, (iii) a 2023 peer group of companies and (iv) a 2024 peer group of companies.
Purchases of Equity Securities by the Company and Affiliated Purchases There were no purchases of equity securities by the Company during the fourth quarter of the year ended December 31, 2023. Item 6. Reserved 59
Purchases of Equity Securities by the Company and Affiliated Purchases There were no purchases of equity securities by the Company during the fourth quarter of the year ended December 31, 2024. Item 6. Reserved 60
The 2022 peer group consists of a customized peer group of fourteen companies that includes: Agilent Technologies Inc, Alcon Inc., Align Technology Inc, The Cooper Companies Inc, Dentsply Sirona Inc, Dexcom Inc, Edwards Lifesciences Corp, Hologic Inc, Jazz Pharmaceuticals Plc, Perrigo Company Plc, Resmed Inc, Teleflex Inc, Zimmer Biomet Holdings Inc and Zoetis Inc.
The 2024 peer group therefore consists of a customized peer group of fifteen companies that includes: Agilent Technologies Inc, Alcon Inc., Align Technology Inc, The Cooper Companies Inc, Dentsply Sirona Inc, Dexcom Inc, Edwards Lifesciences Corp, Hologic Inc, Jazz Pharmaceuticals Plc, Organon & Co., Perrigo Company Plc, Resmed Inc, Teleflex Inc, Viatris Inc. and Zimmer Biomet Holdings Inc.
The Commissioner may not make an application to the Competition Tribunal under Section 92 of the Competition Act more than one year after the merger has been substantially completed. Exchange Controls Canada has no system of exchange controls. There are no Canadian exchange restrictions on the repatriation of capital or earnings of a Canadian public company to non-resident investors.
Where transaction parties request and obtain from the Commissioner an “advance ruling certificate”, the Commissioner may not file an application in respect of the transaction. Exchange Controls Canada has no system of exchange controls. There are no Canadian exchange restrictions on the repatriation of capital or earnings of a Canadian public company to non-resident investors.
In 2023, the Company completed an assessment to review its current peers and added Organon & Co. to its peer group in order to ensure a robust group of peer companies across the health care supplies, health care equipment, and pharmaceuticals industries.
In 2024, the Company completed an assessment to review its current peers. As a result of this assessment, the Company removed Zoetis Inc. and added Viatris Inc. to its peer group. This replacement within the peer group was in order to add further weight to our peer group with companies who have a position in the eye care industry.
Added
Where a transaction has been notified to the Commissioner, the Commissioner may not make an application to the Competition Tribunal under Section 92 of the Competition Act more than one year after the transaction has been substantially completed (for a transaction that was not subject to mandatory notification and for which voluntary clearance was not sought, the timeframe for an application is three years following completion).

Item 7. Management's Discussion & Analysis

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

152 edited+35 added−60 removed127 unchanged
Biggest changeFood and Drug Administration (the “FDA”) and equivalent agencies outside of the United States and the results thereof; • actions by the FDA or other regulatory authorities with respect to our products or facilities; • compliance with the legal and regulatory requirements of our marketed products; • our ability to comply with the financial and other covenants contained in our Amended Credit Agreement, the indenture governing our October 2028 Secured Notes and other current or future debt agreements, including the limitations, restrictions and prohibitions such covenants may impose on the way we conduct our business, including prohibitions on incurring additional debt if certain financial covenants are not met, our ability to draw under the revolving credit facility under our Amended Credit Agreement (the “Revolving Credit Facility”) and restrictions on our ability to make certain investments and other restricted payments; • any downgrade or additional downgrade by rating agencies in our or BHC's credit ratings, which may impact, among other things, our ability to raise debt and the cost of capital for additional debt issuances; • changes in the assumptions used in connection with our impairment analyses or assessments, which would lead to a change in such impairment analyses and assessments and which could result in an impairment in the goodwill associated with any of our reporting units or impairment charges related to certain of our products or other intangible assets; • the risks and uncertainties relating to the XIIDRA Acquisition, including our ability to effectively and efficiently integrate the acquired XIIDRA ® product, pipeline products, transferred sales force and other assets into our existing business, risks that such integration efforts will potentially divert the efforts and attention of management and other employees away from our ongoing business operations, the effect of the transaction on our ability to maintain 86 relationships with customers, suppliers, and other business partners, risks relating to our increased levels of debt as a result of debt incurred to finance such acquisition and risks that we may not realize the expected benefits of the acquisition on a timely basis or at all; • the possibility that the unaudited pro forma financial information included in this Form 10-K may not necessarily be indicative of what the consolidated results of operations would have been had the XIIDRA Acquisition been completed on January 1, 2022 and may differ materially from our actual results of operations; • the uncertainties associated with the acquisition and launch of new products, assets and businesses (including the recently-acquired XIIDRA ® product and Blink ® product line and our recently launched MIEBO ® product), including, but not limited to, our ability to provide the time, resources, expertise and funds required for the commercial launch of new products, the acceptance and demand for new products, the failure to obtain required regulatory approvals, clearances or authorizations, and the impact of competitive products and pricing, which could lead to material impairment charges; • our ability or inability to extend the profitable life of our products, including through line extensions and other life-cycle programs; • our ability to manage the transition to our new Chairman and Chief Executive Officer and other new executive officers and key employees, the success of such individuals in assuming their respective roles and the ability of such individuals to implement and achieve the strategies and goals of the Company as they develop; • our ability to retain, motivate and recruit executives and other key employees; • our ability to implement effective succession planning for our executives and other key employees; • factors impacting our ability to achieve anticipated revenues for our products, including changes in anticipated marketing spend on such products and launch of competing products; • factors impacting our ability to achieve anticipated market acceptance for our products, including the pricing of such products, effectiveness of promotional efforts, reputation of our products and launch of competing products; • our ability to compete against companies that are larger and have greater financial, technical and human resources than we do, as well as other competitive factors, such as technological advances achieved, patents obtained and new products introduced by our competitors; • the extent to which our products are reimbursed by government authorities, pharmacy benefit managers (“PBMs”) and other third-party payors; the impact our distribution, pricing and other practices may have on the decisions of such government authorities, PBMs and other third-party payors to reimburse our products; and the impact of obtaining or maintaining such reimbursement on the price and sales of our products; • the inclusion of our products on formularies or our ability to achieve favorable formulary status, as well as the impact on the price and sales of our products in connection therewith; • the consolidation of wholesalers, retail drug chains and other customer groups and the impact of such industry consolidation on our business; • our ability to maintain strong relationships with physicians and other health care professionals; • our eligibility for benefits under tax treaties and the continued availability of low effective tax rates for the business profits of certain of our subsidiaries; • the implementation of the Organisation for Economic Co-operation and Development inclusive framework on Base Erosion and Profit Shifting, including the global minimum corporate tax rate, by the countries in which we operate; • the actions of our third-party partners or service providers of research, development, manufacturing, marketing, distribution or other services, including their compliance with applicable laws and contracts, which actions may be beyond our control or influence, and the impact of such actions on us; • the risks associated with the international scope of our operations, including our presence in emerging markets and the challenges we face when entering and operating in new and different geographic markets (including the challenges created by new and different regulatory regimes in such countries and the need to comply with applicable anti-bribery and economic sanctions, laws and regulations); • adverse global economic conditions and credit markets and foreign currency exchange uncertainty and volatility in certain of the countries in which we do business; 87 • trade conflicts, including the trade conflict between the United States and China; • risks associated with the ongoing conflict between Russia and Ukraine and the export controls, sanctions and other restrictive actions that have been or may be imposed by the United States, Canada, the EU and other countries against governmental and other entities and individuals in or associated with Russia, Belarus and parts of Ukraine, including its potential escalation and the potential impact on sales, earnings, market conditions and the ability of the Company to manage resources and historical investment in Russia; • risks associated with the ongoing conflict in the Middle East involving Israel and Hamas, including its potential escalation and the potential impact on our operations, sale of products and revenues in this region; • our ability to obtain, maintain and license sufficient intellectual property rights over our products and enforce and defend against challenges to such intellectual property; • the introduction of generic, biosimilar or other competitors of our branded products and other products, including the introduction of products that compete against our products that do not have patent or data exclusivity rights; • the expense, timing and outcome of pending or future legal and governmental proceedings, arbitrations, investigations, subpoenas, tax and other regulatory audits, examinations, reviews and regulatory proceedings against us or relating to us and settlements thereof; • our ability to obtain components, raw materials or finished products supplied by third parties (some of which may be single-sourced) and other manufacturing and related supply difficulties, interruptions and delays; • the disruption of delivery of our products and the routine flow of manufactured goods; • potential work stoppages, slowdowns or other labor problems at our facilities and the resulting impact on our manufacturing, distribution and other operations; • economic factors over which we have no control, including inflationary pressures as a result of historically high domestic and global inflation and otherwise, interest rates, foreign currency rates, and the potential effect of such factors on revenues, expenses and resulting margins; • interest rate risks associated with our floating rate debt borrowings; • our ability to effectively distribute our products and the effectiveness and success of our distribution arrangements; • our ability to effectively promote our own products and those of our co-promotion partners; • our ability to secure and maintain third-party research, development, manufacturing, licensing, marketing or distribution arrangements; • the risk that our products could cause, or be alleged to cause, personal injury and adverse effects, leading to potential lawsuits, product liability claims and damages and/or recalls or withdrawals of products from the market; • the mandatory or voluntary recall or withdrawal of our products from the market and the costs associated therewith; • the availability of, and our ability to obtain and maintain, adequate insurance coverage and/or our ability to cover or insure against the total amount of the claims and liabilities we face, whether through third-party insurance or self-insurance; • our indemnity agreements, which may result in an obligation to indemnify or reimburse the relevant counterparty, which amounts may be material; • the difficulty in predicting the expense, timing and outcome within our legal and regulatory environment, including with respect to approvals by the FDA, Health Canada, the European Medicines Agency (“EMA”) and similar agencies in other jurisdictions, legal and regulatory proceedings and settlements thereof, the protection afforded by our patents and other intellectual and proprietary property, successful generic challenges to our products and infringement or alleged infringement of the intellectual property of others; • the results of continuing safety and efficacy studies by industry and government agencies; • the success of preclinical and clinical trials for our drug development pipeline or delays in clinical trials that adversely impact the timely commercialization of our pipeline products, as well as other factors impacting the commercial success of our products, which could lead to material impairment charges; 88 • uncertainties around the successful improvement and modification of our existing products and development of new products, which may require significant expenditures and efforts; • the results of management reviews of our research and development portfolio (including following the receipt of clinical results or feedback from the FDA or other regulatory authorities), which could result in terminations of specific projects which, in turn, could lead to material impairment charges; • the seasonality of sales of certain of our products; • declines in the pricing and sales volume of certain of our products that are distributed or marketed by third parties, over which we have no or limited control; • compliance by us or our third-party partners and service providers (over whom we may have limited influence), or the failure by us or these third parties to comply, with health care “fraud and abuse” laws and other extensive regulation of our marketing, promotional and business practices (including with respect to pricing), worldwide anti-bribery laws (including the U.S.
Biggest change("Elios Vision") and Whitecap Biosciences, LLC, ("Whitecap Biosciences")), including risks that we may not realize the expected benefits of such acquisitions and transactions on a timely basis or at all, 85 risks that pipeline products acquired may not be commercialized as anticipated, and risks relating to any increased levels of debt as a result of debt incurred to finance certain of these acquisitions and transactions; • the uncertainties associated with the acquisition and launch of new products, assets and businesses, including, but not limited to, our ability to provide the time, resources, expertise and funds required for the commercial launch of new products, the acceptance and demand for new products, the failure to obtain required regulatory approvals, clearances or authorizations, and the impact of competitive products and pricing, which could lead to material impairment charges; • our ability or inability to extend the profitable life of our products, including through line extensions and other life-cycle programs; • our ability to retain, motivate and recruit executives and other key employees; • our ability to implement effective succession planning for our executives and other key employees; • factors impacting our ability to achieve anticipated revenues for our products, including changes in anticipated marketing spend on such products and launch of competing products; • factors impacting our ability to achieve anticipated market acceptance for our products, including the pricing of such products, effectiveness of promotional efforts, reputation of our products and launch of competing products; • our ability to compete against companies that are larger and have greater financial, technical and human resources than we do, as well as other competitive factors, such as technological advances achieved, patents obtained and new products introduced by our competitors; • the extent to which our products are reimbursed by government authorities, pharmacy benefit managers (“PBMs”) and other third-party payors; the impact our distribution, pricing and other practices may have on the decisions of such government authorities, PBMs and other third-party payors to reimburse our products; and the impact of obtaining or maintaining such reimbursement on the price and sales of our products; • the inclusion of our products on formularies or our ability to achieve favorable formulary status, as well as the impact on the price and sales of our products in connection therewith; • the consolidation of wholesalers, retail drug chains and other customer groups and the impact of such industry consolidation on our business; • our ability to maintain strong relationships with physicians and other health care professionals; • our eligibility for benefits under tax treaties and the continued availability of low effective tax rates for the business profits of certain of our subsidiaries; • the implementation of the Organisation for Economic Co-operation and Development inclusive framework on Base Erosion and Profit Shifting, including the global minimum corporate tax rate, by the countries in which we operate; • the actions of our third-party partners or service providers of research, development, manufacturing, marketing, distribution or other services, including their compliance with applicable laws and contracts, which actions may be beyond our control or influence, and the impact of such actions on us; • the risks associated with the international scope of our operations, including our presence in emerging markets and the challenges we face when entering and operating in new and different geographic markets (including the challenges created by new and different regulatory regimes in such countries and the need to comply with applicable anti-bribery and economic sanctions, laws and regulations); • adverse global economic conditions and credit markets and foreign currency exchange uncertainty and volatility in certain of the countries in which we do business; • risks associated with the potential imposition of and adverse changes to the U.S. duty, tariff and other trading policies, and any potential counter-duties, counter-tariffs and/or other counter-measures implemented in response by other countries, which could increase our manufacturing, distribution and other operational costs due to the higher duties and tariffs and the increased economic risks and uncertainties to the global economy as a result of potential trade wars and global supply chain issues that may be triggered by the tariff changes; • trade conflicts, including current and future trade disputes between the United States and China; 86 • risks associated with the ongoing conflict between Russia and Ukraine and the export controls, sanctions and other restrictive actions that have been or may be imposed by the United States, Canada, the EU and other countries against governmental and other entities and individuals in or associated with Russia, Belarus and parts of Ukraine, including its potential escalation and the potential impact on sales, earnings, market conditions and the ability of the Company to manage resources and historical investment in Russia; • risks associated with the ongoing conflict in the Middle East involving Israel, Hamas and other countries and militant groups in the region, including its potential continued escalation and expansion and the potential impact on our operations, sale of products and revenues in this region; • our ability to obtain, maintain and license sufficient intellectual property rights over our products and enforce and defend against challenges to such intellectual property; • the introduction of generic, biosimilar or other competitors of our branded products and other products, including the introduction of products that compete against our products that do not have patent or data exclusivity rights; • the expense, timing and outcome of pending or future legal and governmental proceedings, arbitrations, investigations, subpoenas, tax and other regulatory audits, examinations, reviews and regulatory proceedings against us or relating to us and settlements thereof; • our ability to obtain components, raw materials or finished products supplied by third parties (some of which may be single-sourced) and other manufacturing and related supply difficulties, interruptions and delays; • the disruption of delivery of our products and the routine flow of manufactured goods; • potential work stoppages, slowdowns or other labor problems at our facilities and the resulting impact on our manufacturing, distribution and other operations; • economic factors over which we have no control, including inflationary pressures as a result of heightened domestic and global inflation and otherwise, heightened interest rates, foreign currency rates, and the potential effect of such factors on revenues, expenses and resulting margins; • interest rate risks associated with our floating rate debt borrowings; • our ability to effectively distribute our products and the effectiveness and success of our distribution arrangements; • our ability to effectively promote our own products and those of our co-promotion partners; • our ability to secure and maintain third-party research, development, manufacturing, licensing, marketing or distribution arrangements; • the risk that our products could cause, or be alleged to cause, personal injury and adverse effects, leading to potential lawsuits, product liability claims and damages and/or recalls or withdrawals of products from the market; • the mandatory or voluntary recall or withdrawal of our products from the market and the costs associated therewith; • the availability of, and our ability to obtain and maintain, adequate insurance coverage and/or our ability to cover or insure against the total amount of the claims and liabilities we face, whether through third-party insurance or self-insurance; • our indemnity agreements, which may result in an obligation to indemnify or reimburse the relevant counterparty, which amounts may be material; • the difficulty in predicting the expense, timing and outcome within our legal and regulatory environment, including with respect to approvals by the FDA, Health Canada, the European Medicines Agency (“EMA”) and similar agencies in other jurisdictions, legal and regulatory proceedings and settlements thereof, the protection afforded by our patents and other intellectual and proprietary property, successful generic challenges to our products and infringement or alleged infringement of the intellectual property of others; • the results of continuing safety and efficacy studies by industry and government agencies; • the success of preclinical and clinical trials for our drug development pipeline or delays in clinical trials that adversely impact the timely commercialization of our pipeline products, as well as other factors impacting the commercial success of our products, which could lead to material impairment charges; 87 • uncertainties around the successful improvement and modification of our existing products and development of new products, which may require significant expenditures and efforts; • the results of management reviews of our research and development portfolio (including following the receipt of clinical results or feedback from the FDA or other regulatory authorities), which could result in terminations of specific projects which, in turn, could lead to material impairment charges; • the seasonality of sales of certain of our products; • declines in the pricing and sales volume of certain of our products that are distributed or marketed by third parties, over which we have no or limited control; • compliance by us or our third-party partners and service providers (over whom we may have limited influence), or the failure by us or these third parties to comply, with health care “fraud and abuse” laws and other extensive regulation of our marketing, promotional and business practices (including with respect to pricing), worldwide anti-bribery laws (including the U.S.
In addition, the October 2028 Secured Notes are structurally subordinated to: (i) all liabilities of any of the Company’s subsidiaries that do not guarantee the October 2028 Secured Notes and (ii) any of the Company’s debt that is secured by assets that are not collateral for the October 2028 Secured Notes.
In addition, the October 2028 Secured Notes are structurally subordinated to: (i) all liabilities of any of the Company’s subsidiaries that do not guarantee the October 2028 Secured Notes and (ii) any of the Company’s debt that is secured by assets that are not collateral for the October 2028 Notes.
Prior to October 1, 2025, the Company may on any one or more occasions redeem up to 40% of the aggregate principal amount of the October 2028 Secured Notes at a redemption price of 108.375% of the principal amount thereof, redeemed plus accrued and unpaid interest to, but not including, the date of redemption with the proceeds of one of more equity offerings.
Prior to October 1, 2025, the Company may on any one or more occasions redeem up to 40% of the aggregate principal amount of the October 2028 Secured Notes at a redemption price of 108.375% of the principal amount thereof, redeemed plus accrued and unpaid interest to, but not including, the date of redemption with the proceeds of one or more equity offerings.
The fair value of acquired in-process research and development (“IPR&D”) is also recognized at fair value using an income approach and consists of the following estimates and inputs: (i) each asset’s probability-adjusted future cash flows, which reflect the different stages of development of each product and the associated probability of successful completion and (ii) the risk-adjusted discount rate used to present value the cash flows. • Acquisition-related contingent consideration, which primarily consists of potential milestone payments, is determined in accordance with the acquisition method of accounting.
The fair value of acquired in-process research and development (“IPR&D”) is also recognized at fair value using an income approach and consists of the following estimates and inputs: (i) each asset’s probability-adjusted future cash flows, which reflect the different stages of development of each product and the associated probability of successful completion and (ii) the risk-adjusted discount rate used to present value the cash flows. 79 • Acquisition-related contingent consideration, which primarily consists of potential milestone payments, is determined in accordance with the acquisition method of accounting.
MIEBO ® is the first and only FDA-approved treatment for DED that directly targets tear evaporation and we believe the addition of MIEBO ® will help build upon our strong portfolio of integrated eye health products. • LuxLife ® – We are expanding our portfolio of premium IOLs built on the “Lux” platform with the LuxLife ® Trifocal IOL with two options, non-Toric and Toric for astigmatic patients.
MIEBO ® is the first and only FDA-approved treatment for DED that directly targets tear evaporation and the addition of MIEBO ® will help build upon our strong portfolio of integrated eye health products. • LuxLife ® – We are expanding our portfolio of premium IOLs built on the “Lux” platform with the LuxLife ® Trifocal IOL with two options, non-Toric and Toric for astigmatic patients.
Foreign Corrupt Practices Act and the Canadian Corruption of Foreign Public Officials Act), worldwide economic sanctions and/or export laws, worldwide environmental laws and regulation and privacy and security regulations; • the impacts of the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010 (the “Health Care Reform Act”) and any potential amendment thereof and other legislative and regulatory health care reforms in the countries in which we operate, including with respect to recent government inquiries on pricing; • the impact of any changes in or reforms to the legislation, laws, rules, regulation and guidance that apply to us and our businesses and products or the enactment of any new or proposed legislation, laws, rules, regulations or guidance that will impact or apply to us or our businesses or products; • the impact of changes in federal laws and policy that may be undertaken under the Biden administration; • illegal distribution or sale of counterfeit versions of our products; • interruptions, breakdowns or breaches in our information technology systems; and • risks in Item 1A.
Foreign Corrupt Practices Act and the Canadian Corruption of Foreign Public Officials Act), worldwide economic sanctions and/or export laws, worldwide environmental laws and regulation and privacy and security regulations; • the impacts of the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010 (the “Health Care Reform Act”) and any potential amendment thereof and other legislative and regulatory health care reforms in the countries in which we operate, including with respect to recent government inquiries on pricing; • the impact of any changes in or reforms to the legislation, laws, rules, regulation and guidance that apply to us and our businesses and products or the enactment of any new or proposed legislation, laws, rules, regulations or guidance that will impact or apply to us or our businesses or products; • the impact of changes in federal laws and policy that may be undertaken under the Trump administration; • illegal distribution or sale of counterfeit versions of our products; • interruptions, breakdowns or breaches in our information technology systems; and • risks in Item 1A.
Global Minimum Corporate Tax Rate On October 8, 2021, the Organisation for Economic Co-operation and Development (“OECD”)/G20 inclusive framework on Base Erosion and Profit Shifting (the “Inclusive Framework”) published a statement updating and finalizing the key components of a two-pillar plan on global tax reform originally agreed on July 1, 2021, and a timetable for implementation by 2023.
Global Minimum Corporate Tax Rate On October 8, 2021, the Organisation for Economic Co-operation and Development (“OECD”)/G20 inclusive framework on Base Erosion and Profit Shifting (the “Inclusive Framework”) published a statement updating and finalizing the key components of a two-pillar plan on global tax reform originally agreed on July 1, 2021, and a timetable for 64 implementation by 2023.
These mandatory prepayments may be used to satisfy future amortization. The amortization rate for the May 2027 Term Facility is 1.00% per annum, or $25 million, payable in quarterly installments, and the first installment was paid on September 30, 2022. Bausch + Lomb may direct that prepayments be 75 applied to such amortization payments in order of maturity.
These mandatory prepayments may be used to satisfy future amortization. The amortization rate for the May 2027 Term Facility is 1.00% per annum, or $25 million, payable in quarterly installments, and the first installment was paid on September 30, 2022. Bausch + Lomb may direct that prepayments be applied to such amortization payments in order of maturity.
The Inclusive Framework agreement must now be implemented by the OECD Members who have agreed to the plan, effective in 2024. Many members of the Inclusive Framework have either introduced or announced their intention to introduce certain components of the global minimum tax in line with the model rules for fiscal year beginning on or after December 31, 2023.
The Inclusive Framework agreement must be implemented by the OECD Members who have agreed to the plan, effective in 2024. Many members of the Inclusive Framework have either introduced or announced their intention to introduce certain components of the global minimum tax in line with the model rules for fiscal year beginning on or after December 31, 2023.
Strategic Acquisitions and Licensing Agreements To supplement our internal R&D initiatives and to build-out and refresh our product portfolio, we also search for opportunities to augment our pipeline through arrangements that allow us to gain access to unique products and investigational treatments, by strategically aligning ourselves with other innovative product solutions.
Strategic Acquisitions and Licensing Agreements To supplement our internal R&D initiatives and to build-out and refresh our product portfolio, we also search for opportunities to augment our pipeline through arrangements that allow us to gain access to unique products and 62 investigational treatments, by strategically aligning ourselves with other innovative product solutions.
Department of Health and Human Services, the FDA and applicable foreign governments in locations in which we operate; however, at this time, it is unclear the effect these matters may have on our businesses. For more information, see Item 1. “Business”.
Department of Health and Human Services, the FDA and applicable foreign governments in locations in which we operate; however, at this time, it is unclear the effect these matters may have on our businesses. 65 For more information, see Item 1. “Business”.
Revenue growth rates inherent in these forecasts were based on input from internal and external market research that compare factors such as growth in global economies, recent industry trends and 81 product life-cycles.
Revenue growth rates inherent in these forecasts were based on input from internal and external market research that compare factors such as growth in global economies, recent industry trends and product life-cycles.
Forward-looking statements can generally be identified by the use of words such as “believe,” “anticipate,” “expect,” “intend,” “estimate,” “plan,” “schedule,” “continue,” “future,” “will,” “may,” “can,” “might,” “could,” “would,” “should,” “target,” “potential,” “opportunity,” “designed,” “create,” “predict,” “project,” “timeline,” “forecast,” “outlook,” “guidance,” “seek,” “strive,” “suggest,” “prospective,” “strategy,” “indicative,” “intend,” “ongoing,” “decrease” or “increase” and positive and negative variations thereof or other similar expressions.
Forward-looking statements can generally be identified by the use of words such as “believe,” “anticipate,” “expect,” “intend,” “estimate,” “plan,” “schedule,” “continue,” “future,” “will,” “may,” “can,” “might,” “could,” “would,” “should,” “target,” “potential,” “opportunity,” “designed,” “create,” “predict,” “project,” “timeline,” “forecast,” “outlook,” “guidance,” “seek,” “strive,” “suggest,” “prospective,” “strategy,” “indicative,” “ongoing,” “likely,” “evolve,” “decrease” or “increase” and positive and negative variations thereof or other similar expressions.
For example, a successful challenge of our patent rights resulting in earlier than expected generic competition; 80 • an adverse change in the extent or manner in which an asset is used or is expected to be used.
For example, a successful challenge of our patent rights resulting in earlier than expected generic competition; • an adverse change in the extent or manner in which an asset is used or is expected to be used.
See Note 20, “LEGAL PROCEEDINGS” to our audited Consolidated Financial Statements for further details of these matters. Our ability to successfully defend the Company against pending and future litigation may impact cash flows. Future Licensing Payments In the ordinary course of business, we may enter into select licensing and collaborative agreements for the commercialization and/or development of unique products.
See Note 19, “LEGAL PROCEEDINGS” to our audited Consolidated Financial Statements for further details of these matters. Our ability to successfully defend the Company against pending and future litigation may impact cash flows. Future Licensing Payments In the ordinary course of business, we may enter into select licensing and collaborative agreements for the commercialization and/or development of unique products.
The ultimate outcome of any litigation or other contingency may be material to our results of operations, financial condition and cash flows. See Note 20, “LEGAL PROCEEDINGS” to our audited Consolidated Financial Statements for further details regarding our current legal proceedings. Income Taxes We have operations in various countries that have differing tax laws and rates.
The ultimate outcome of any litigation or other contingency may be material to our results of operations, financial condition and cash flows. See Note 19, “LEGAL PROCEEDINGS” to our audited Consolidated Financial Statements for further details regarding our current legal proceedings. Income Taxes We have operations in various countries that have differing tax laws and rates.
If market conditions deteriorate, or if the Company is unable to execute its strategies, it may be necessary to record impairment charges in the future. There were no goodwill impairment charges through December 31, 2023. See Note 8, “INTANGIBLE ASSETS AND GOODWILL” to our audited Consolidated Financial Statements for further details.
If market conditions deteriorate, or if the Company is unable to execute its strategies, it may be necessary to record impairment charges in the future. There were no goodwill impairment charges through December 31, 2024. See Note 8, “INTANGIBLE ASSETS AND GOODWILL” to our audited Consolidated Financial Statements for further details.
We caution that, as it is not possible to predict or identify all relevant factors that may impact forward-looking statements, the foregoing list of important factors that may affect future results is not exhaustive and should not be considered a complete statement of all potential risks and uncertainties. 89
We caution that, as it is not possible to predict or identify all relevant factors that may impact forward-looking statements, the foregoing list of important factors that may affect future results is not exhaustive and should not be considered a complete statement of all potential risks and uncertainties. 88
Positioning for Growth Product Development We continuously search for new product opportunities through internal development, strategic licensing agreements and acquisitions, that, if successful, will allow us to leverage our commercial footprint and supplement our existing product portfolio and address specific unmet needs in the market.
Product Development We continuously search for new product opportunities through internal development, strategic licensing agreements and acquisitions, that, if successful, will allow us to leverage our commercial footprint and supplement our existing product portfolio and address specific unmet needs in the market.
See Note 22, “SEGMENT INFORMATION” to our audited Consolidated Financial Statements for the disaggregation of revenues which depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by the economic factors of each category of customer contracts.
See Note 21, “SEGMENT INFORMATION” to our audited Consolidated Financial Statements for the disaggregation of revenues which depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by the economic factors of each category of customer contracts.
We believe that this acquisition is an important step in continuing to expand our surgical portfolio as it provides us with the opportunity to increase our manufacturing capacity and more specifically bolster our position in the ophthalmic microsurgical instrumentation market. We regularly consider further strategic licensing and acquisition opportunities, some of which could be material in size.
We believe that this acquisition is an important step in continuing to expand our surgical portfolio as it provided us with the opportunity to increase our manufacturing capacity and more specifically bolster our position in the ophthalmic microsurgical instrumentation market. 63 We regularly consider further strategic licensing and acquisition opportunities, some of which could be material in size.
Key surgical brands include Akreos ® , AMVISC ® , IC-8 ® Apthera™, Crystalens ® IOLs, enVista ® IOLs, Millennium ® , Stellaris Elite ® vision enhancement system, Synergetics ® , ClearVisc ® , StableVisc™, Storz ® ophthalmic instruments, VICTUS ® femtosecond laser, Teneo™, Eyefill ® and Zyoptix TM .
Key surgical brands include Akreos ® , AMVISC ® , IC-8 ® Apthera™, Crystalens ® IOLs, enVista ® IOLs, Millennium ® , Stellaris Elite ® vision enhancement system, 61 Synergetics ® , ClearVisc ® , StableVisc ® , Storz ® ophthalmic instruments, VICTUS ® femtosecond laser, Teneo ® , Eyefill ® and Zyoptix ® .
If we revise these forecasts or determine that certain planning events will not occur, an adjustment to the valuation allowance will be made to tax expense in the period such determination is made. 83 NEW ACCOUNTING STANDARDS Information regarding the recently issued new accounting guidance (adopted and not adopted as of December 31, 2023) is contained in Note 2, “SIGNIFICANT ACCOUNTING POLICIES” to our audited Consolidated Financial Statements. 84 FORWARD-LOOKING STATEMENTS Caution regarding forward-looking information and statements and “Safe-Harbor” statements under the U.S.
If we revise these forecasts or determine that certain planning events will not occur, an adjustment to the valuation allowance will be made to tax expense in the period such determination is made. 82 NEW ACCOUNTING STANDARDS Information regarding the recently issued new accounting guidance (adopted and not adopted as of December 31, 2024) is contained in Note 2, “SIGNIFICANT ACCOUNTING POLICIES” to our audited Consolidated Financial Statements. 83 FORWARD-LOOKING STATEMENTS Caution regarding forward-looking information and statements and “Safe-Harbor” statements under the U.S.
In particular, the Company can offer no assurance that any spinoff transaction will occur at all, or that any such transaction will occur on the timelines or in the manner anticipated by the Company and BHC; • ongoing litigation and potential additional litigation, claims, challenges and/or regulatory investigations challenging or otherwise relating to the B+L IPO and the proposed separation from BHC and the costs, expenses, use of resources, diversion of management time and efforts, liability and damages that may result therefrom; • pricing decisions that we have implemented or may in the future elect to implement at the direction of our pricing committees or otherwise; • legislative or policy efforts, including those that may be introduced and passed by the U.S.
In particular, the Company can offer no assurance that the Separation, Distribution and/ or a Sale Transaction will occur at all, or that any such transactions will occur on the timelines or in the manner anticipated by the Company and BHC; • ongoing litigation and potential additional litigation, claims, challenges and/or regulatory investigations challenging or otherwise relating to the B+L IPO and the proposed Separation from BHC and the costs, expenses, use of resources, diversion of management time and efforts, liability and damages that may result therefrom; • pricing decisions that we have implemented or may in the future elect to implement at the direction of our pricing committees or otherwise; • legislative or policy efforts, including those that may be introduced and passed by the U.S.
For additional discussion of our reportable segments, see the discussion in Item 1. "Business — Segment Information" and Note 22, “SEGMENT INFORMATION” to our audited Consolidated Financial Statements for further details on these reportable segments.
For additional discussion of our reportable segments, see the discussion in Item 1. "Business — Segment Information" and Note 21, “SEGMENT INFORMATION” to our audited Consolidated Financial Statements for further details on these reportable segments.
The October 2028 Secured Notes accrue interest at a rate of 8.375% per year, payable semi-annually in arrears on each April 1 and October 1, commencing on April 1, 2024. The October 2028 Secured Notes are guaranteed by each of the Company’s subsidiaries that is a guarantor under the Amended Credit Agreement (the “Note Guarantors”).
The October 2028 Secured Notes accrue interest at a rate of 8.375% per year, payable semi-annually in arrears on each April 1 and October 1, which commenced on April 1, 2024. The October 2028 Secured Notes are guaranteed by each of the Company’s subsidiaries that is a guarantor under the Amended Credit Agreement (the “Note Guarantors”).
A detailed discussion of the year-over-year changes of the Company’s 2022 results compared with that of 2021 can be found under "Management’s Discussion and Analysis of Financial Condition and Results of Operations'' included in our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC and the CSA on February 22, 2023. 66 2023 Compared to 2022 Revenues Our revenues are primarily generated from product sales in the therapeutic areas of eye health that consist of: (i) branded prescription eye-medications and pharmaceuticals, (ii) generic and branded generic prescription eye medications and pharmaceuticals, (iii) OTC vitamin and supplement products and (iv) medical devices (contact lenses, IOLs and ophthalmic surgical equipment).
A detailed discussion of the year-over-year changes of the Company’s 2023 results compared with that of 2022 can be found under "Management’s Discussion and Analysis of Financial Condition and Results of Operations'' included in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC and the CSA on February 21, 2024. 67 2024 Compared to 2023 Revenues Our revenues are primarily generated from product sales in the therapeutic areas of eye health that consist of: (i) branded prescription eye-medications and pharmaceuticals, (ii) generic and branded generic prescription eye medications and pharmaceuticals, (iii) OTC vitamin and supplement products and (iv) medical devices (contact lenses, IOLs and ophthalmic surgical equipment).
R&D expenses as a percentage of Product sales were approximately 7.8% and 8.2% for 2023 and 2022, respectively. Amortization of Intangible Assets Intangible assets with finite lives are amortized using the straight-line method over their estimated useful lives, generally 1 to 17 years. Management continually assesses the useful lives related to our long-lived assets to reflect the most current assumptions.
R&D expenses as a percentage of Product sales were approximately 7.2% and 7.8% for 2024 and 2023, respectively. Amortization of Intangible Assets Intangible assets with finite lives are amortized using the straight-line method over their estimated useful lives, generally 3 to 17 years. Management continually assesses the useful lives related to our long-lived assets to reflect the most current assumptions.
The Pharmaceuticals segment— consists of a broad line of proprietary and generic pharmaceutical products for post-operative treatments and treatments for a number of eye conditions, such as glaucoma, eye inflammation, ocular hypertension, dry eyes and retinal diseases. Key proprietary pharmaceutical brands are Vyzulta ® , Lotemax ® , Prolensa ® and 60 Minims ® .
The Pharmaceuticals segment— consists of a broad line of proprietary and generic pharmaceutical products for post-operative treatments and treatments for a number of eye conditions, such as glaucoma, eye inflammation, ocular hypertension, dry eyes and retinal diseases. Key proprietary pharmaceutical brands are MIEBO ® , XIIDRA ® , Vyzulta ® , Lotemax ® , Prolensa ® and Minims ® .
Our team of approximately 850 dedicated Research and Development (“R&D”) employees is focused on advancing our pipeline and identifying new product opportunities and we believe we have a significant innovation opportunity today. We plan to develop and, where applicable, commercialize our global pipeline of over 60 projects, many of which are global projects being developed in and for multiple countries.
Our team of approximately 1,000 dedicated Research and Development (“R&D”) employees is focused on advancing our pipeline and identifying new product opportunities and we believe we have a significant innovation opportunity today. We plan to develop and, where applicable, commercialize our global pipeline of approximately 60 projects, many of which are global projects being developed in and for multiple countries.
The following table presents segment revenues, segment revenues as a percentage of total revenues and the period-over-period changes in segment revenues for 2023 and 2022. 2023 2022 Change (in millions) Amount Pct. Amount Pct. Amount Pct.
The following table presents segment revenues, segment revenues as a percentage of total revenues and the period-over-period changes in segment revenues for 2024 and 2023. 2024 2023 Change (in millions) Amount Pct. Amount Pct. Amount Pct.
A detailed discussion of the year-over-year changes of the Company’s 2022 results compared with that of 2021 can be found under "Management’s Discussion and Analysis of Financial Condition and Results of Operations'' included in our Annual Report on Form 10-K for the year ended December 31, 2022, filed with the SEC and the CSA on February 22, 2023.
A detailed discussion of the year-over-year changes of the Company’s 2023 results compared with that of 2022 can be found under "Management’s Discussion and Analysis of Financial Condition and Results of Operations'' included in our Annual Report on Form 10-K for the year ended December 31, 2023, filed with the SEC and the CSA on February 21, 2024.
Year Ended December 31, 2023 Year Ended December 31, 2022 Change in Constant Currency Revenue (Non-GAAP) Revenue as Reported Changes in Exchange Rates Constant Currency Revenue (Non-GAAP) Revenue as Reported (in millions) Amount Pct.
Year Ended December 31, 2024 Year Ended December 31, 2023 Change in Constant Currency Revenue (Non-GAAP) Revenue as Reported Changes in Exchange Rates Constant Currency Revenue (Non-GAAP) Revenue as Reported (in millions) Amount Pct.
The applicable interest rate margins for borrowings under the Revolving Credit Facility are (i) between 0.75% to 1.75% with respect to U.S. dollar base rate or Canadian dollar prime rate borrowings and between 1.75% to 2.75% with respect to SOFR, EURIBOR, SONIA or CDOR borrowings based on the Company’s total net leverage ratio and (ii) after (x) Bausch + Lomb’s senior unsecured non-credit-enhanced long-term indebtedness for borrowed money receives an investment grade rating from at least two of Standard & Poor’s (“S&P”), Moody’s and Fitch and (y) the May 2027 Term Facility and September 2028 Term Facility have been repaid in full in cash (the “IG Trigger”), between 0.015% to 0.475% with respect to U.S. dollar base rate or Canadian dollar prime rate borrowings and between 1.015% to 1.475% with respect to SOFR, EURIBOR, SONIA or CDOR borrowings based on the Company’s debt rating.
The applicable interest rate margins for borrowings under the Revolving Credit Facility are (i) between 0.75% to 1.75% with respect to U.S. dollar base rate borrowings and between 1.75% to 2.75% with respect to SOFR, EURIBOR or SONIA borrowings based on the Company’s total net leverage ratio and (ii) after (x) Bausch + Lomb’s senior unsecured non-credit-enhanced long-term indebtedness for borrowed money receives an investment grade rating from at least two of Standard & Poor’s (“S&P”), Moody’s and Fitch and (y) the Term Facilities have been repaid in full in cash (the “IG Trigger”), between 0.015% to 0.475% with respect to U.S. dollar base rate borrowings and between 1.015% to 1.475% with respect to SOFR, EURIBOR or SONIA borrowings based on the Company’s debt rating.
We believe this acquisition will enable us to continue to grow our global OTC business. • Acquisition of AcuFocus – During January 2023, we acquired AcuFocus, Inc. ("AcuFocus"). AcuFocus is an ophthalmic medical device company that has delivered breakthrough small aperture intraocular technology to address diverse unmet needs in eye care.
This acquisition has enabled us to continue to grow our global OTC business. • Acquisition of AcuFocus – During January 2023, we acquired AcuFocus, Inc. ("AcuFocus"). AcuFocus is an ophthalmic medical device company that has delivered breakthrough small aperture intraocular technology to address diverse unmet needs in eye care.
Subject to certain exceptions and customary baskets set forth in the Amended Credit Agreement, Bausch + Lomb is required to make mandatory prepayments of the loans under the May 2027 Term Facility and September 2028 Term Facility under certain circumstances, including from: (i) 100% of the net cash proceeds of insurance and condemnation proceeds for property or asset losses (subject to reinvestment rights, decrease based on leverage ratios and net proceeds threshold), (ii) 100% of the net cash proceeds from the incurrence of debt (other than permitted debt as described in the Amended Credit Agreement), (iii) 50% of Excess Cash Flow (as defined in the Amended Credit Agreement) subject to decrease based on leverage ratios and subject to a threshold amount and (iv) 100% of net cash proceeds from asset sales (subject to reinvestment rights, decrease based on leverage ratios and net proceeds threshold).
Subject to certain exceptions and customary baskets set forth in the Amended Credit Agreement, Bausch + Lomb is required to make mandatory prepayments of the loans under the Term Facilities under certain circumstances, including from: (i) 100% of the net cash proceeds of insurance and condemnation proceeds for property or asset losses (subject to reinvestment rights, decrease based on leverage ratios and net proceeds threshold), (ii) 100% of the net cash proceeds from the incurrence of debt (other than permitted debt as described in the Amended Credit Agreement), (iii) 50% of Excess Cash Flow (as defined in the Amended Credit Agreement) subject to decrease based on leverage ratios and subject to a threshold 75 amount and (iv) 100% of net cash proceeds from asset sales (subject to reinvestment rights, decrease based on leverage ratios and net proceeds threshold).
Accordingly, the Company’s non-GAAP financial measures and ratios may not be comparable to such similarly titled non-GAAP financial measures and ratios used by other companies. 67 The following table presents a reconciliation of Revenues to constant currency revenues (non-GAAP) and the period-over-period changes in constant currency revenue (non-GAAP) for 2023 and 2022.
Accordingly, the Company’s non-GAAP financial measures and ratios may not be comparable to such similarly titled non-GAAP financial measures and ratios used by other companies. 68 The following table presents a reconciliation of Revenues to constant currency revenues (non-GAAP) and the period-over-period changes in constant currency revenue (non-GAAP) for 2024 and 2023.
As of December 31, 2023, the remaining mandatory quarterly amortization payments for the May 2027 Term Facility were $81 million through March 2027, with the remaining term loan balance being due in May 2027. The amortization rate for the September 2028 Term Facility is 1.00% per annum, or $5 million, payable in quarterly installments.
As of December 31, 2024, the remaining mandatory quarterly amortization payments for the May 2027 Term Facility were $56 million through March 2027, with the remaining term loan balance being due in May 2027. The amortization rate for the September 2028 Term Facility is 1.00% per annum, or $5 million, payable in quarterly installments.
Bausch + Lomb may direct that prepayments be applied to such amortization payments in order of maturity. As of December 31, 2023, the remaining mandatory quarterly amortization payments for the September 2028 Term Facility were $23 million through June 2028, with the remaining term loan balance being due in September 2028.
Bausch + Lomb may direct that prepayments be applied to such amortization payments in order of maturity. As of December 31, 2024, the remaining mandatory quarterly amortization payments for the September 2028 Term Facility were $18 million through June 2028, with the remaining term loan balance being due in September 2028.
This “Management’s Discussion and Analysis of Financial Condition and Results of Operations” has been updated through February 21, 2024 and should be read in conjunction with the audited Consolidated Financial Statements and the related notes thereto included elsewhere in this Annual Report on Form 10-K.
This “Management’s Discussion and Analysis of Financial Condition and Results of Operations” has been updated through February 19, 2025 and should be read in conjunction with the audited Consolidated Financial Statements and the related notes thereto included elsewhere in this Annual Report on Form 10-K.
Weighted Average Stated Rate of Interest The weighted average stated rate of interest for the Company’s outstanding debt obligations as of December 31, 2023 and December 31, 2022 was 8.65% and 7.84%, respectively. 76 Credit Ratings As of the date of this filing, February 21, 2024, the credit ratings and outlook from Moody’s, S&P and Fitch for certain outstanding obligations of Bausch + Lomb were as follows: Rating Agency Corporate Rating Senior Secured Rating Outlook Moody’s B1 Negative Standard & Poor’s B- B- Positive Fitch B- BB- Rating Watch Evolving Any downgrade in our corporate credit ratings or senior secured ratings may increase our cost of borrowing and may negatively impact our ability to raise additional debt capital.
Weighted Average Stated Rate of Interest The weighted average stated rate of interest for the Company’s outstanding debt obligations as of December 31, 2024 and December 31, 2023 was 7.95% and 8.65%, respectively. 76 Credit Ratings As of the date of this filing, February 19, 2025, the credit ratings and outlook from Moody’s, S&P and Fitch for certain outstanding obligations of Bausch + Lomb were as follows: Rating Agency Corporate Rating Senior Secured Rating Outlook Moody’s B1 Stable Standard & Poor’s B- B- Positive Fitch B- BB- Rating Watch Evolving Any downgrade in our corporate credit ratings or senior secured ratings may increase our cost of borrowing and may negatively impact our ability to raise additional debt capital.
Quality assurance are the costs incurred to meet evolving customer and regulatory standards and include: employee compensation costs; overhead and occupancy costs; amortization of software; and other third-party costs. R&D expenses were $324 million and $307 million for 2023 and 2022, respectively, an increase of $17 million, or 6%, primarily due to certain products in development, as previously discussed.
Quality assurance are the costs incurred to meet evolving customer and regulatory standards and include: employee compensation costs; overhead and occupancy costs; amortization of software; and other third-party costs. R&D expenses were $343 million and $324 million for 2024 and 2023, respectively, an increase of $19 million, or 6%, primarily due to certain products in development, as previously discussed.
See Note 22, “SEGMENT INFORMATION” to our audited Consolidated Financial Statements for a reconciliation of segment profit to Income before provision for income taxes. The following table presents segment profits, segment profits as a percentage of segment revenues and the period-over-period changes in segment profits for 2023 and 2022. 2023 2022 Change (in millions) Amount Pct. Amount Pct. Amount Pct.
See Note 21, “SEGMENT INFORMATION” to our audited Consolidated Financial Statements for a reconciliation of segment profit to Income before provision for income taxes. 71 The following table presents segment profits, segment profits as a percentage of segment revenues and the period-over-period changes in segment profits for 2024 and 2023. 2024 2023 Change (in millions) Amount Pct. Amount Pct.
In addition, we launched our first silicone hydrogel daily disposable multifocal contact lens in May 2023, and plan to launch a toric lens in 2024. • Lumify ® (brimonidine tartrate ophthalmic solution, 0.025%) - An OTC redness reliever eye drop that significantly reduces redness to help eyes look whiter and brighter, revealing eyes’ natural beauty.
In addition, we launched our first silicone hydrogel daily disposable multifocal contact lens in May 2023, and launched a toric lens in the U.S. in June 2024. • Lumify ® (brimonidine tartrate ophthalmic solution, 0.025%) - An OTC redness reliever eye drop that significantly reduces redness to help eyes look whiter and brighter, revealing eyes’ natural beauty.
See Note 17, “INCOME TAXES” to our audited Consolidated Financial Statements for further details.
See Note 16, “INCOME TAXES” to our audited Consolidated Financial Statements for further details.
In addition to our working capital requirements, as of December 31, 2023, we expect our primary cash requirements for 2024 to include: • Debt repayments and interest —We expect to make interest payments of approximately $371 million and mandatory debt amortization payments of $30 million in 2024 under our Senior Secured Credit Facilities and may elect to make additional principal payments under certain circumstances.
In addition to our working capital requirements, as of December 31, 2024, we expect our primary cash requirements for 2025 to include: • Debt repayments and interest —We expect to make interest payments of approximately $380 million and mandatory debt amortization payments of $40 million in 2025 under our Senior Secured Credit Facilities and may elect to make additional principal payments under certain circumstances.
Bausch + Lomb is a subsidiary of Bausch Health Companies Inc. (“BHC”), with BHC holding, directly or indirectly, approximately 88.4% of the issued and outstanding common shares of Bausch + Lomb, as of February 16, 2024. For additional discussion regarding the separation of Bausch + Lomb from BHC, refer to Item 1.
Bausch + Lomb is a subsidiary of Bausch Health Companies Inc. (“BHC”), with BHC holding, directly or indirectly, approximately 88.1% of the issued and outstanding common shares of Bausch + Lomb, as of February 12, 2025. For additional discussion regarding the separation of Bausch + Lomb from BHC, refer to Item 1. "Business".
Term SOFR-based borrowings under the May 2027 Term Facility are subject to a credit spread adjustment of 0.10%. The stated rate of interest under the May 2027 Term Facility at December 31, 2023 was 8.71% per annum.
Term SOFR-based borrowings under the May 2027 Incremental Term Facility are subject to a credit spread adjustment of 0.10%. The stated rate of interest under the May 2027 Incremental Term Facility at December 31, 2024 was 7.71% per annum.
On August 4, 2023, Canada released draft legislation to enact certain components of the pillar two proposals into Canadian law as the Global Minimum Tax Act (“GMTA”). The GMTA is generally aligned with the model rules proposed by the OECD and is expected to become effective for fiscal years beginning on or after December 31, 2023.
On August 4, 2023, Canada released draft legislation to enact certain components of the pillar two proposals into Canadian law as the Global Minimum Tax Act (“GMTA”), which was enacted on June 20, 2024. The GMTA is generally aligned with the model rules proposed by the OECD and is effective for fiscal years beginning on or after December 31, 2023.
Provisions recorded to reduce gross product sales to net product sales and revenues for 2023 and 2022 were as follows: 68 Years Ended December 31, 2023 2022 (in millions) Amount Pct. Amount Pct.
Provisions recorded to reduce gross product sales to net product sales and revenues for 2024 and 2023 were as follows: 69 Years Ended December 31, 2024 2023 (in millions) Amount Pct. Amount Pct.
The timetable for implementation has since been extended to 2024 or, with respect to certain components of the plan, to 2025. The Inclusive Framework plan has now been agreed to by 145 OECD members, including several countries which did not agree to the initial plan.
The timetable for implementation was extended to 2024 or, with respect to certain components of the plan, to 2025. The Inclusive Framework plan has now been agreed to by more than 140 OECD members, including several countries which did not agree to the initial plan.
Risk Factors—Our indebtedness could adversely affect our business and our ability to meet our obligations; • Capital expenditures —We expect to make payments of approximately $250 million for property, plant and equipment in 2024 and; • Benefit obligations —We expect to make aggregate payments under our pension and postretirement obligations of $10 million in 2024.
Risk Factors—Our indebtedness could adversely affect our business and our ability to meet our obligations; • Capital expenditures —We expect to make payments of approximately $280 million for property, plant and equipment in 2025; • Benefit obligations —We expect to make aggregate payments under our pension and postretirement obligations of $5 million in 2025.
We believe that the IC-8 ® Apthera TM EDOF IOL will bolster our surgical portfolio by enhancing our IOL offerings, which is a strategic area of focus for the Company. 2022 Licensing Agreement and Acquisitions 62 • During July 2022, we entered into an exclusive European distribution agreement with Sanoculis Ltd.
We believe that the IC-8 ® Apthera TM IOL will bolster our surgical portfolio by enhancing our IOL offerings, which is a strategic area of focus for the Company. 2022 Licensing Agreement and Acquisitions • During July 2022, we entered into an exclusive European distribution agreement with Sanoculis Ltd. ("Sanoculis") for Sanoculis' Minimally Invasive Micro Sclerostomy ("MIMS ® ").
A maximum of approximately 3,100,000 common shares could be issued upon vesting of the performance-based restricted share units outstanding.
A maximum of approximately 10,800,000 common shares could be issued upon vesting of the performance-based restricted share units outstanding.
Cost of goods sold typically vary between periods as a result of product mix, volume, royalties, changes in foreign currency and inflation. Cost of goods sold excludes the amortization and impairments of intangible assets. Cost of goods sold was $1,640 million and $1,511 million for 2023 and 2022, respectively, an increase of $129 million, or 9%.
Cost of goods sold typically vary between periods as a result of product mix, volume, royalties, changes in foreign currency and inflation. Cost of goods sold excludes the amortization and impairments of intangible assets. Cost of goods sold was $1,868 million and $1,640 million for 2024 and 2023, respectively, an increase of $228 million, or 14%.
Term SOFR-based borrowings under the September 2028 Term Facility are not subject to any credit spread adjustment. The stated rate of interest under the September 2028 Term Facility at December 31, 2023 was 9.36% per annum.
Term SOFR-based borrowings under the September 2028 Term Facility are not subject to any credit spread adjustment. The stated rate of interest under the September 2028 Term Facility at December 31, 2024 was 8.33% per annum.
We believe the XIIDRA Acquisition will complement and grow our existing dry eye franchise. • Acquisition of Blink ® Product Line – In July 2023, we acquired the Blink ® OTC product line of eye and contact lens drops from Johnson & Johnson Vision, which consists of Blink ® Tears Lubricating Eye Drops, Blink ® Tears Preservative Free Lubricating Eye Drops, Blink GelTears ® Lubricating Eye Drops, Blink ® Triple Care Lubricating Eye Drops, Blink Contacts ® Lubricating Eye Drops and Blink-N-Clean ® Lens Drops (collectively, the “Blink ® Product Line”).
The XIIDRA Acquisition complements and has enabled us to grow our dry eye franchise. • Acquisition of Blink ® Product Line – In July 2023, we acquired the Blink ® OTC product line of eye and contact lens drops from Johnson & Johnson Vision, which consists of Blink ® Tears Lubricating Eye Drops, Blink ® Tears Preservative Free Lubricating Eye Drops, Blink GelTears ® Lubricating Eye Drops, Blink ® Triple Care Lubricating Eye Drops, Blink Contacts ® Lubricating Eye Drops and Blink-N-Clean ® Lens Drops (collectively, the “Blink ® Product Line”).
In May 2023, the Biden administration announced a round of U.S. sanctions and export controls against Russia and Belarus in response to the ongoing war. These sanctions temporarily impacted our ability to distribute our U.S. manufactured contact lenses and our U.S. surgical products to Russia and Belarus. However, in response to these sanctions, we applied for licenses with the U.S.
The former Biden administration imposed U.S. sanctions and export controls against Russia and Belarus in response to the ongoing war. These sanctions temporarily impacted our ability to distribute our U.S. manufactured contact lenses and our U.S. surgical products to Russia and Belarus. However, in response to these sanctions, we applied for licenses with the U.S.
See “Risk Factors—Risks Relating to the International Scope of our Business—As a result of the current conflict between Russia and Ukraine, the current and any future responses by the global community to such conflict and any counter responses by the Russian government or other entities or individuals, and the potential expansion of the conflict to other countries, we have experienced and may continue to experience an adverse impact on our business and operations in this region, as well as on our business and operations generally, which could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares to decline.” 63 Israel-Hamas Conflict The conflict between Israel and Hamas began during October 2023.
See “Risk Factors—Risks Relating to the International Scope of our Business—As a result of the current conflict between Russia and Ukraine, the current and any future responses by the global community to such conflict and any counter responses by the Russian government or other entities or individuals, and the potential expansion of the conflict to other countries, we have experienced and may continue to experience an adverse impact on our business and operations in this region, as well as on our business and operations generally, which could have a material adverse effect on our business, financial condition, cash flows and results of operations and could cause the market value of our common shares to decline.” Conflict in the Middle East The conflict between Israel and Hamas began during October 2023 and has since expanded to include other countries and militant groups and, despite a recently announced ceasefire between Israel and Hamas (which took effect on January 19, 2025), may continue to negatively impact the region.
Description of Credit Facilities Borrowings under the Revolving Credit Facility in: (i) U.S. dollars bear interest at a rate per annum equal to, at our option, either (a) a term Secured Overnight Financing Rate ("SOFR")-based rate or (b) a U.S. dollar base rate, (ii) Canadian dollars bear interest at a rate per annum equal to, at our option, either (a) Canadian Dollar Offered Rate ("CDOR") or (b) a Canadian dollar prime rate, (iii) euros bear interest at a rate per annum equal to EURIBOR and (iv) pounds sterling bear interest at a rate per annum equal to Sterling Overnight Index Average ("SONIA") (provided, however, that the term SOFR-based rate, CDOR, EURIBOR and SONIA shall be no less than 0.00% per annum at any time and the U.S. dollar base rate and the Canadian dollar prime rate shall be no less than 1.00% per annum at any time), in each case, plus an applicable margin.
Description of Senior Secured Credit Facilities Borrowings under the Revolving Credit Facility in: (i) U.S. dollars bear interest at a rate per annum equal to, at our option, either (a) a term Secured Overnight Financing Rate (“SOFR”)-based rate or (b) a U.S. dollar base rate, (ii) Canadian dollars, when available pursuant to the terms of the Suspension of Rights Agreement, will bear interest at a rate to be agreed between the parties, (iii) euros bear interest at a rate per annum equal to EURIBOR and (iv) pounds sterling bear interest at a rate per annum equal to Sterling Overnight Index Average ("SONIA") (provided, however, that the term SOFR-based rate, EURIBOR and SONIA shall be no less than 0.00% per annum at any time and the U.S. dollar base rate shall be no less than 1.00% per annum at any time), in each case, plus an applicable margin.
The increase is primarily attributable to: (i) increased interest expense associated with the May 2027 Term Facility and interest expense related to our September 2028 Term Facility and October 2028 Secured Notes (each as defined and discussed in further detail, under Item “— Liquidity and Capital Resources — Liquidity and Debt — Long-term Debt”), (ii) certain upfront financing commitment costs incurred in connection with the XIIDRA Acquisition and (iii) interest expense related to the outstanding balance under our Revolving Credit Facility (as defined and discussed in further detail, under Item “— Liquidity and Capital Resources — Liquidity and Debt — Long-term Debt”).
The increase was primarily attributable to: (i) interest expense associated with our October 2028 Secured Notes, September 2028 Term Facility and May 2027 Incremental Term Facility (each as defined and discussed in further detail, under Item “— Liquidity and Capital Resources — Liquidity and Debt — Long-term Debt”) and (ii) interest expense related to our Revolving Credit Facility (as defined and discussed in further detail, under Item “— Liquidity and Capital Resources — Liquidity and Debt — Long-term Debt”), partially offset by certain upfront financing commitment costs incurred in connection with the XIIDRA Acquisition during the prior period.
These forward-looking statements relate to, among other things: our business strategy, business plans, business prospects and forecasts and changes thereto; product pipeline, prospective products and product approvals, expected launches of new products, product development and results of current and anticipated products; our recently consummated acquisition of XIIDRA ® and certain other ophthalmology assets (the “XIIDRA Acquisition”); anticipated revenues for our products; expected R&D and marketing spend; our expected primary cash and working capital requirements for 2024 and beyond; our plans for continued improvement in operational efficiency and the anticipated impact of such plans; our expectations regarding the implementation of a system upgrade to our Lynchburg distribution facility; our liquidity and our ability to satisfy our debt maturities as they become due; our ability to comply with the covenants contained in our credit agreement, as recently amended , (the “Amended Credit Agreement”) and in the indenture governing our October 2028 Secured Notes; any proposed pricing actions; exposure to foreign currency exchange rate changes and interest rate changes; the outcome of contingencies, such as litigation, subpoenas, investigations, reviews, audits and regulatory proceedings; the anticipated impact of the adoption of new accounting standards; general market conditions and economic uncertainty; our expectations regarding our financial performance, including our future financial and operating performance, revenues, expenses, gross margins and income taxes; our impairment assessments, including the assumptions used therein and the results thereof; the anticipated effect of current market conditions and recessionary pressures in one or more of our markets; the anticipated effect of macroeconomic factors, including inflation; the anticipated impact from the ongoing conflicts between Russia and Ukraine and in the Middle East involving Israel and Hamas; and the anticipated separation from Bausch Health Companies Inc.
These forward-looking statements relate to, among other things: our business strategy, business plans, business prospects and forecasts and changes thereto; product pipeline, prospective products and product approvals, expected launches of new products, product development and results of current and anticipated products; anticipated revenues for our products; expected Research and Development ("R&D") and marketing spend; our expected primary cash and working capital requirements for 2025 and beyond; our plans for continued improvement in operational efficiency and the anticipated impact of such plans; our beliefs about our manufacturing facilities and relationships; expected risks of loss of patent or regulatory exclusivity; our liquidity and our ability to satisfy our debt maturities as they become due; our ability to comply with the covenants contained in our credit agreement, as amended (the “Amended Credit Agreement”) and in the indenture governing our October 2028 Secured Notes; any proposed pricing actions; exposure to foreign currency exchange rate changes and interest rate changes; the outcome of contingencies, such as litigation, subpoenas, investigations, reviews, audits and regulatory proceedings and any expected indemnifications therefrom; the anticipated impact of the adoption of new accounting standards; general market conditions and economic uncertainty; our expectations regarding our financial performance, including our future financial and operating performance, revenues, expenses, gross margins and income taxes; our impairment assessments, including the assumptions used therein and the results thereof; the anticipated effect of current market conditions and recessionary pressures in one or more of our markets; the anticipated effect of macroeconomic factors, including inflation and imposition of and adverse changes to tariff and other trade protection measures; the anticipated impact from the ongoing conflicts between Russia and Ukraine and in the Middle East involving Israel, Hamas and other countries and militant groups in the region; and the anticipated separation from Bausch Health Companies Inc.
This product is expected to be launched in various European markets in 2024. • enVista ® – We are expanding our portfolio of premium IOLs built on the enVista ® platform with enVista Aspire TM (Monofocal Plus), enVista Envy TM Trifocal and enVista Beyond TM (extended depth of focus (“EDOF”)) optical designs with two options: non-Toric and Toric for astigmatism patients. enVista Aspire TM monofocal and toric IOLs with Intermediate Optimized optics launched in the U.S. during October 2023 and we anticipate launching the Trifocal and EDOF optical designs for presbyopia in the U.S. in 2024 and 2026, respectively.
This product is expected to be launched in various European markets in 2025. • enVista ® – We are expanding our portfolio of premium IOLs built on the enVista ® platform with enVista Aspire ® (Monofocal Plus), enVista Envy TM Trifocal and enVista Beyond TM (extended depth of focus (“EDOF”)) optical designs with two options: non-Toric and Toric for astigmatism patients. enVista Aspire ® monofocal and toric IOLs with Intermediate Optimized optics were launched in the U.S. during October 2023 and in Europe in January 2025 and we anticipate launching in Canada in 2025. enVista Envy TM launched in Canada in June 2024 and the U.S. launch is in-process, after receiving FDA approval in October 2024.
("Sanoculis") for Sanoculis' Minimally Invasive Micro Sclerostomy ("MIMS ® "). MIMS ® is an innovative minimally invasive surgical procedure for the treatment of glaucoma.
MIMS ® is an innovative minimally invasive surgical procedure for the treatment of glaucoma.
Other Future Cash Requirements Our other future cash requirements relate to working capital, capital expenditures, business development transactions (contingent consideration), restructuring and integration, benefit obligations and litigation settlements. In addition, we may use cash to enter into licensing arrangements and/or to make strategic acquisitions.
Other Future Cash Requirements Our other future cash requirements relate to working capital, capital expenditures, business development transactions (contingent consideration), restructuring and integration, benefit obligations and litigation settlements. In addition, we may use cash to enter into licensing arrangements and/or to make strategic acquisitions. We regularly consider further acquisition opportunities, some of which could be sizable.
Certain of our products have already been facing generic competition, such as Lotemax ® Gel and Bepreve ® , which began facing LOE in the U.S. during 2021 and in aggregate only accounted for less than 1% of our total revenues in 2021, and Prolensa ® , which began facing LOE in the fourth quarter of 2023 and accounted for approximately 1% of our total revenues in 2023.
Certain of our products have already been facing generic competition, such as Prolensa ® , which began facing LOE in the fourth quarter of 2023 and accounted for less than 1% of our total revenues in 2024 and approximately 1% of our total revenues in 2023.
Prior to the September 2023 Credit Facility Amendment (as defined below), the Credit Agreement provided for a term loan of $2,500 million with a five-year term to maturity (the “May 2027 Term Facility”) and a five-year revolving credit facility of $500 million (the “Revolving Credit Facility”).
The Original Credit Agreement provided for a term loan of $2,500 million with a five-year term to maturity (the “May 2027 Term Facility”) and a five-year revolving credit facility of $500 million (the “Revolving Credit Facility”).
Further, in connection with the Separation and certain transformation initiatives, we continue to evaluate opportunities to improve our operating performance and may initiate cost savings programs to streamline our operations and eliminate redundant processes and expenses.
Further, we continue to evaluate opportunities to improve our operating performance and may initiate cost savings programs to streamline our operations and eliminate redundant processes and expenses.
As military activity and sanctions against Russia, Belarus and specific areas of Ukraine have continued, the war has increasingly affected economic and global financial markets and exacerbated ongoing economic challenges, including issues such as high levels of inflation and global supply-chain disruption.
As military activity and sanctions against Russia, Belarus and specific areas of Ukraine have continued, the war has continued to affect economic and global financial markets and placed further pressure on ongoing economic challenges, including issues such as inflation and global supply-chain disruption.
Based on the qualitative fair value assessment performed, Management believed that it was more likely than not that the carrying value of its former Bausch + Lomb reporting units were less than their respective fair values and therefore, concluded a quantitative assessment was not required.
Based on its qualitative assessment as of October 1, 2024, management believed that, it was more likely than not that 81 the carrying amounts of each of its reporting units were less than their respective fair values and therefore concluded that a quantitative fair value test was not required.
See Note 20, “LEGAL PROCEEDINGS” to our audited Consolidated Financial Statements for further information. 65 RESULTS OF OPERATIONS Our operating results for the years 2023, 2022 and 2021 were as follows: Years Ended December 31, Change (in millions) 2023 2022 2021 2022 to 2023 2021 to 2022 Revenues Product sales $ 4,131 $ 3,746 $ 3,737 $ 385 $ 9 Other revenues 15 22 28 (7) (6) 4,146 3,768 3,765 378 3 Expenses Cost of goods sold (excluding amortization and impairments of intangible assets) (Note 3) 1,640 1,511 1,458 129 53 Cost of other revenues 2 8 9 (6) (1) Selling, general and administrative (Note 3) 1,736 1,478 1,389 258 89 Research and development (Note 3) 324 307 271 17 36 Amortization of intangible assets 240 244 292 (4) (48) Other expense, net 74 13 17 61 (4) 4,016 3,561 3,436 455 125 Operating income 130 207 329 (77) (122) Interest income 15 6 — 9 6 Interest expense (Note 3) (283) (146) — (137) (146) Foreign exchange and other (28) 6 (11) (34) 17 (Loss) income before provision for income taxes (166) 73 318 (239) (245) Provision for income taxes (82) (58) (125) (24) 67 Net (loss) income (248) 15 193 (263) (178) Net income attributable to noncontrolling interest (12) (9) (11) (3) 2 Net (loss) income attributable to Bausch + Lomb Corporation $ (260) $ 6 $ 182 $ (266) $ (176) A detailed discussion of the year-over-year changes of the Company’s 2023 results compared with that of 2022 can be found below.
See Note 19, “LEGAL PROCEEDINGS” to our audited Consolidated Financial Statements for further information. 66 RESULTS OF OPERATIONS Our operating results for the years 2024, 2023 and 2022 were as follows: Years Ended December 31, Change (in millions) 2024 2023 2022 2023 to 2024 2022 to 2023 Revenues Product sales $ 4,774 $ 4,131 $ 3,746 $ 643 $ 385 Other revenues 17 15 22 2 (7) 4,791 4,146 3,768 645 378 Expenses Cost of goods sold (excluding amortization and impairments of intangible assets) (Note 3) 1,868 1,640 1,511 228 129 Cost of other revenues 4 2 8 2 (6) Selling, general and administrative (Note 3) 2,082 1,736 1,478 346 258 Research and development (Note 3) 343 324 307 19 17 Amortization of intangible assets 288 240 244 48 (4) Other expense, net 44 74 13 (30) 61 4,629 4,016 3,561 613 455 Operating income 162 130 207 32 (77) Interest income 15 15 6 — 9 Interest expense (Note 3) (399) (283) (146) (116) (137) Foreign exchange and other (12) (28) 6 16 (34) (Loss) income before provision for income taxes (234) (166) 73 (68) (239) Provision for income taxes (71) (82) (58) 11 (24) Net (loss) income (305) (248) 15 (57) (263) Net income attributable to noncontrolling interest (12) (12) (9) — (3) Net (loss) income attributable to Bausch + Lomb Corporation $ (317) $ (260) $ 6 $ (57) $ (266) A detailed discussion of the year-over-year changes of the Company’s 2024 results compared with that of 2023 can be found below.
During the second quarter of 2023, we put into place a system upgrade; however, we incurred disruptions during the implementation of this upgrade, which resulted in the slower than normal processing of certain orders, thereby negatively impacting our revenues for 2023. We expect to substantially resolve the Lynchburg implementation disruptions during the first quarter of 2024.
Our 2023 revenues were negatively impacted due to previously unfulfilled orders at our Lynchburg distribution facility. During the second quarter of 2023, we put into place a system upgrade; however, we incurred disruptions during the implementation of this upgrade, which resulted in slower than normal processing of certain orders, thereby negatively impacting our revenues for the year 2023.
Research and Development Expenses Included in R&D are costs related to our product development and quality assurance programs. Expenses related to product development include: employee compensation costs; overhead and occupancy costs; depreciation of research and development facilities and equipment; clinical trial costs; clinical manufacturing and scale-up costs; and other third-party development costs.
Expenses related to product development include: employee compensation costs; overhead and occupancy costs; depreciation of research and development facilities and equipment; clinical trial costs; clinical manufacturing and scale-up costs; and other third-party 70 development costs.
Amortization of Intangible assets was $240 million and $244 million for 2023 and 2022, respectively, a decrease of $4 million, or 2%, primarily due to fully amortized intangible assets no longer being amortized in 2023, partially offset by assets acquired through acquisitions, as previously discussed.
Amortization of Intangible assets was $288 million and $240 million for 2024 and 2023, respectively, an increase of $48 million, or 20%, primarily due to assets acquired through acquisitions, as previously discussed, partially offset by fully amortized intangible assets no longer being amortized in 2024.
As of December 31, 2023, the principal amounts outstanding under the May 2027 Term Facility and September 2028 Term Facility were $2,462 million and $499 million, respectively.
As of December 31, 2024, the principal amounts outstanding under the May 2027 Term Facility, May 2027 Incremental Term Facility and September 2028 Term Facility were $2,437 million, $400 million and $494 million, respectively.
In addition, as of February 16, 2024, we had outstanding approximately 7,900,000 stock options and 5,300,000 restricted share units that each represent the right of a holder to receive one of Bausch + Lomb’s common shares and 1,200,000 performance-based restricted share units that represent the right of a holder to receive a number of the Company’s common shares up to a specified maximum.
In addition, as of February 12, 2025, we had outstanding approximately 9,000,000 stock options and 6,400,000 restricted share units that each represent the right of a holder to receive one of Bausch + Lomb’s common shares and 4,100,000 performance-based restricted share units that represent the right of a holder to receive a number of the Company’s common shares up to a specified maximum.
After completing the testing, the fair value of each of these reporting units exceeded its carrying value by more than 45%, and, therefore, there was no impairment to goodwill. 2022 Annual Goodwill Impairment Test The Company conducted its annual goodwill impairment test as of October 1, 2022 by performing a quantitative assessment for each of its reporting units.
After completing the testing, the fair value of each of these reporting units exceeded its carrying value by more than 25%, and, therefore, there was no impairment to goodwill. 2024 Annual Goodwill Impairment Test The Company conducted its annual goodwill impairment test as of October 1, 2024, by first assessing qualitative factors.
Contract service revenue is derived primarily from contract manufacturing for third parties and is not material. 79 The Company recognizes revenue when the customer obtains control of promised goods or services and in an amount that reflects the consideration to which the Company expects to be entitled to receive in exchange for those goods or services.
The Company recognizes revenue when the customer obtains control of promised goods or services and in an amount that reflects the consideration to which the Company expects to be entitled to receive in exchange for those goods or services.
In addition, the PreserVision ® U.S. formulation patent expired in March 2021, but a patent covering methods of using the formulation remains in force into 2026. PreserVision ® products accounted for approximately 7% and 7% of our total revenues in 2023 and 2022, respectively. PreserVision ® is (or was) the subject of certain ongoing and past patent infringement proceedings.
The PreserVision ® U.S. formulation patent expired in March 2021, but a patent covering methods of using the formulation remains in force into 2026. PreserVision ® products accounted for approximately 6% and 7% of our total revenues in 2024 and 2023, respectively.
See Note 11, “PENSION AND POSTRETIREMENT EMPLOYEE BENEFIT PLANS” to our audited Consolidated Financial Statements for the year ended December 31, 2023, for additional information on pension and postretirement obligations included in this Form 10-K. Acquisition of AcuFocus, Inc. As previously discussed, on January 17, 2023, the Company acquired AcuFocus, Inc. (“AcuFocus”) for an up-front purchase price of $35 million.
See Note 11, “PENSION AND POSTRETIREMENT EMPLOYEE BENEFIT PLANS” to our audited Consolidated Financial Statements for the year ended December 31, 2024, for additional information on pension and postretirement obligations included in this Form 10-K and; • Business Development —As previously discussed, during January 2025, the Company acquired Whitecap Biosciences for an up-front purchase price of approximately $28 million, which was paid in January 2025.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeAs of December 31, 2023, a 1% change in foreign currency exchange rates would have impacted our shareholders’ equity by approximately $27 million. Interest Rate Risk During 2023, the Company became more susceptible to interest rate risk due to additional debt issuances.
Biggest changeAs of December 31, 2024, a 1% change in foreign currency exchange rates would have impacted our shareholders’ equity by approximately $27 million. Interest Rate Risk As of December 31, 2024, we had $3,441 million and $1,400 million in outstanding aggregate principal amount of issued variable rate and fixed rate debt, respectively.
Foreign Currency Risk In the year ended December 31, 2023, a majority of our revenue and expense activities and capital expenditures were denominated in U.S. dollars. We have exposure to multiple foreign currencies, including, among others, the Euro, Chinese yuan, Russian ruble and Japanese yen.
Foreign Currency Risk In the year ended December 31, 2024, a majority of our revenue and expense activities and capital expenditures were denominated in U.S. dollars. We have exposure to multiple foreign currencies, including, among others, the Euro, Chinese yuan, Russian ruble and Japanese yen.
A 100 basis-points increase or decrease in interest rates would have an annualized pre-tax effect of approximately $32 million in our Consolidated Statements of Operations and Cash Flows, based on current outstanding borrowings and effective interest rates on our variable rate debt.
A 100 basis-points increase or decrease in interest rates would have an annualized pre-tax effect of approximately $34 million in our Consolidated Statements of Operations and Cash Flows, based on current outstanding borrowings and effective interest rates on our variable rate debt.
While our variable-rate debt may impact earnings and cash flows as a result of changes in effective interest rates, it is not subject to changes in fair value. The estimated fair value of our issued fixed rate debt as of December 31, 2023 was $1,470 million.
While our variable-rate debt may impact earnings and cash flows as a result of changes in effective interest rates, it is not subject to changes in fair value. The estimated fair value of our issued fixed rate debt as of December 31, 2024 was $1,449 million.
If interest rates were to increase by 100 basis-points, the fair value of our issued fixed rate debt would decrease by approximately $46 million. If interest rates were to decrease by 100 basis-points, the fair value of our issued fixed rate debt would increase by approximately $41 million.
If interest rates were to increase by 100 basis-points, the fair value of our issued fixed rate debt would decrease by approximately $35 million. If interest rates were to decrease by 100 basis-points, the fair value of our issued fixed rate debt would increase by approximately $31 million.
As of December 31, 2023, we had $3,236 million and $1,400 million in outstanding aggregate principal amount of issued variable rate and fixed rate debt, respectively. We are subject to interest rate risk on our variable rate debt as changes in interest rates could adversely affect earnings and cash flows.
We are subject to interest rate risk on our variable rate debt as changes in interest rates could adversely affect earnings and cash flows.

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