Organon & Co.

Current report

Risks Related to the Merger with Sun Pharma

Current report

The closing of our proposed merger with and into Sun Pharma is subject to a number of conditions, many of which are largely outside of the parties’ control, and, if these conditions are not satisfied or waived on a timely basis, the merger agreement may be terminated and the transaction may not be completed.

Current report

On April 26, 2026, we entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Sun Pharma and the additional parties thereto, relating to the merger. The consummation of the merger is subject to various conditions, including, among others, customary conditions relating to: the adoption of the Merger Agreement by the holders of a majority of the outstanding shares entitled to vote on such matter at a stockholders’ meeting duly called and held for such purpose; the expiration or termination of any applicable waiting periods (and any extension thereof) under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the “HSR Act”), and the receipt of certain non-U.S. antitrust and foreign direct investment approvals; the absence of any law or order making unlawful or restraining, enjoining or otherwise prohibiting consummation of the Merger; the absence of any “Company Material Adverse Effect” (as defined in the Merger Agreement) having occurred since the signing that is continuing as of the closing; the filing or receipt of required regulatory approvals without the imposition of any term, condition or consequence the acceptance of which would constitute a “Substantial Detriment” (as defined in the Merger Agreement) and other customary conditions relating to the accuracy of representations and warranties and performance of covenants.

Current report

The governmental authorities from which authorizations under antitrust and foreign investment laws, including the HSR Act, are required have broad discretion in administering the governing laws and regulations. These governmental authorities may initiate proceedings seeking to prevent, or otherwise seek to prevent, the merger.

Current report

The failure to satisfy all of the required conditions could delay the completion of the merger by a significant period of time or prevent it from occurring. Any delay in completing the merger could cause the parties to not realize some or all of the benefits that are expected to be achieved if the merger is successfully completed within the expected timeframe. There can be no assurance that the conditions to the closing of the merger will be satisfied or waived or that the merger will be completed within the expected timeframe or at all.

Current report

Failure to complete the merger could adversely affect our stock price and future business and financial results, and our ability to continue as a going concern may be adversely affected.

Current report

There can be no assurance that the conditions to the closing of the merger will be satisfied or waived or that the merger will be completed. If the Merger is not completed within the expected timeframe or at all, our ongoing business could be adversely affected and we will be subject to a variety of risks and possible consequences associated with the failure to complete the merger, including the following: following, or in connection with, the termination of the Merger Agreement, in certain circumstances, we will be required to pay Sun Pharma a termination fee of $120,000,000; we will incur certain transaction costs, including legal, accounting, financial advisor, filing, printing and mailing fees, and substantial acquisition-related costs, including employee retention expenses, regardless of whether the merger closes; under the Merger Agreement, we are subject to certain restrictions on the conduct of our business prior to the closing of the merger, which may adversely affect our ability to execute certain of our business strategies; and the proposed merger, whether or not it closes, will divert the attention of certain of our management and other key employees from ongoing business activities, including the pursuit of other opportunities that could be beneficial to us as an independent company.

Current report

In addition, the Merger Agreement restricts our ability to conduct certain significant financing transactions prior to the closing of the merger, and we may therefore be unable to raise the capital required to execute certain of our business strategies. Further, while we believe that our existing cash resources and cash generated by operations, supplemented as necessary by periodic

Current report

-35- utilization of our revolving credit facility, provide sufficient liquidity to support our near-term working and capital expenditure needs, service the ongoing principal and interest payments on our existing indebtedness, and satisfy our other funding and investment requirements for the next 24 months, we do not expect to generate sufficient cash from operations to repay at maturity the entirety of the then-outstanding balances of our term loan, 4.125% secured notes, and 2.875% euro-denominated secured notes, all of which mature in 2028 (collectively, our “2028 debt”). If the proposed merger does not close, we would be dependent upon our ability to access the credit markets or source additional equity investments to repay or refinance the outstanding balances of our 2028 debt. In addition, our ability to service our indebtedness and to fund our other liquidity requirements will depend on our ability to generate and access cash in the future, which is subject to general economic, financial, contractual, competitive, legislative, regulatory and other factors.

Current report

Failure to raise significant amounts of funding to repay our 2028 debt at maturity would adversely affect our financial condition and could result in a going concern qualification with respect to our annual audited financial statements. We could also be required to raise capital via equity transactions (which may be dilutive to existing investors or provide new investors with rights, preferences, or privileges senior to our common stock), sale of significant assets, and significant cost reduction measures. Even if we are able to reduce or refinance our existing debt, we expect that such actions would result in increased interest expenses, subject us to additional financial covenants and other lender protections, and require significant use of our other available liquidity and capital resources. Any of these measures may have an adverse impact on our ability to execute our business plan, take advantage of future opportunities, including our ability to raise capital, fund our business development initiatives, maintain relationships with third parties with whom we conduct business, including customers, vendors and lenders, or respond to competitive pressures or unanticipated financial requirements. The ultimate success of any such actions in sustaining our ability to continue as a going concern cannot be assured, and no assurance can be given that such financing or asset sales will be available or, if available, that they will be on commercially favorable terms.

Current report

If the merger is not completed, these risks could materially affect our business and financial results and our stock price, including to the extent that the current market price of our common stock is positively affected by a market assumption that the merger will be completed.

Current report

The announcement and pendency of the merger could adversely affect our business, financial results and/or operations.

Current report

Our efforts to complete the merger could cause substantial disruptions in, and create uncertainty surrounding, our business, which may materially adversely affect our results of operation and our business. For example, we may forego opportunities we may have otherwise pursued absent the proposed merger. Uncertainty as to whether the merger will be completed may also affect our ability to recruit prospective employees or to retain and motivate existing employees. Employee retention may be particularly challenging while the merger is pending because employees may experience uncertainty about their roles following the merger. A substantial amount of our management’s and employees’ attention is being directed toward the completion of the merger and therefore is being diverted from our day-to-day operations. Uncertainty as to our future could adversely affect our business and our relationship with vendors, suppliers, regulators and other business partners. For example, vendors, suppliers, and other counterparties may defer decisions concerning working with us, or seek to change existing business relationships with us. Changes to or termination of existing business relationships could adversely affect our results of operations and financial condition, as well as the market price of our common stock. The adverse effects of the pendency of the merger could be exacerbated by any delays in completion of the merger or termination of the Merger Agreement.

Current report

The Merger Agreement limits our ability to pursue alternative transactions, which could deter, but does not prevent, a third party from proposing an alternative transaction that the Company could consider within the parameters set forth in the Merger Agreement.

Current report

The Merger Agreement contains a customary “no-shop” provision which, subject to certain exceptions, restricts our ability to initiate, solicit or knowingly encourage or knowingly facilitate any inquiry or the making of any proposal or offer that constitutes, or would reasonably be expected to lead to, an Acquisition Proposal (as defined in the Merger Agreement) or to engage in discussions or negotiations relating to an Acquisition Proposal. It is possible that these or other provisions in the Merger Agreement might discourage a potential competing acquirer that might have an interest in acquiring all or a significant part of the outstanding shares of our common stock from considering or proposing an acquisition or might result in a potential competing acquirer proposing to pay a lower per share price to acquire our common stock than it might otherwise have proposed to pay.

Current report

Litigation may arise in connection with the merger, which could be costly and divert management’s attention and otherwise materially harm our business.

Current report

Lawsuits may be filed challenging the disclosures contained in the proxy statement and/or challenging other aspects of the merger. Regardless of the outcome of any future litigation related to the merger, such litigation may be time-consuming and expensive and may distract our management from running the day-to-day operations of our business. The litigation costs and diversion of management’s attention and resources to address the claims and counterclaims in any litigation related to the merger may materially adversely affect our business, financial condition and operating results. If the merger is not consummated for any reason, litigation could be filed in connection with the failure to consummate the merger. Any litigation related to the merger may result in negative publicity or an unfavorable impression of us, which could adversely affect the price of our common stock, impair our ability to recruit or retain employees, damage our relationships with our partners, or otherwise materially harm our operations and financial performance.

Previous report

The self-initiated Audit Committee internal investigation has been time-consuming and expensive and may result in additional expense and/or litigation.

Previous report

After concerns regarding the Company’s sales practices for wholesalers for Nexplanon were brought to the Board’s attention, the Audit Committee oversaw an independent, internal investigation into these sales practices.

Previous report

The Audit Committee’s investigation focused on the Company’s sales of Nexplanon to wholesalers. The investigation has found that the Company asked two wholesalers in the United States to purchase greater quantities of Nexplanon at the end of the Relevant Periods than they otherwise would have purchased based on wholesaler demand. In certain instances, the Company waived inventory management fee performance metrics associated with caps on days of inventory to allow wholesalers to be paid the inventory management fees they would have earned but for the Company’s ask to purchase additional inventory.

Previous report

As a result of these purchases, the United States wholesalers significantly decreased or even halted their purchases of Nexplanon during the early weeks of the following quarters until their days of inventory on hand were reduced to levels within the contractual range. Although the incremental amount of Nexplanon sales that occurred during the Relevant Periods represented less than 1% of the Company’s consolidated revenue for the year ended December 31, 2022 or December 31, 2024, as applicable (and less than 2% of the Company’s consolidated revenue for the relevant quarterly periods), based on the results of the investigation, the Company has determined that without these improper sales practices for wholesalers, the Company’s consolidated revenue for the fiscal year ended December 31, 2024 reported in the Original Form 10-K (and certain of the other Relevant Periods) would have fallen short of the Company’s guidance range and/or certain external expectations. While we have taken certain actions aimed at preventing the use of such improper sales practices for wholesalers (including the appointment of a new Interim CEO, the termination and appointment of a new Head of U.S. Commercial & Government Affairs, the appointment of an Executive Chair and the appointment of a Lead Independent Director) and are in the process of implementing additional measures, there is no assurance that these actions and procedures will continue to be effective over time.

Previous report

Additionally, while the Audit Committee’s investigation is complete, the Company has identified material weaknesses in its internal control over financial reporting as described in Part I, Item 4 of this report and, as a result, the Company’s management has determined that our disclosure controls and procedures and internal control over financial reporting were not effective as of December 31, 2024 or as of September 30, 2025. To address the ineffective disclosure controls and procedures and internal control over financial reporting due to the material weaknesses, the Company, with the oversight of its Audit Committee, has developed a remediation plan, which is described in Part I, Item 4 of this report. In accordance with the remediation plan, we

Previous report

-40- continue to evaluate our policies and procedures and we are actively engaged in remedial activities to strengthen the Company’s internal control environment, which include, but are not limited to, the activities described in Part I, Item 4 of this report. As we execute on our remediation plan, there can be no assurance that we will not discover additional matters that we will need to address that could have an adverse impact on us, our business and/or our results of operations, including determining that further changes to our internal controls are required. We have incurred significant expenses, including audit, legal, forensic accounting, consulting and other professional fees, in connection with the Audit Committee investigation and related matters, and we may incur additional time and expense as a result of the investigation and our efforts to address the investigation results. The incurrence of significant additional expense, or the requirement that management and the Board continue to devote significant time that could reduce the time available to execute on our business strategies, could have an adverse effect on our business, results of operations and financial condition.

Previous report

We voluntarily contacted the SEC staff to advise that we had an internal Audit Committee investigation as described in this report. We cannot guarantee that we will not receive inquiries from the SEC or any other regulatory authorities regarding the investigation, or that we will not be subject to future claims, investigations or proceedings. Any future inquiries from the SEC or other regulatory authorities, or future claims or proceedings or any related regulatory investigation will, regardless of the outcome, likely consume a significant amount of our internal resources and result in additional legal and accounting costs. We can provide no assurances as to the outcome of any governmental investigation.

Previous report

In addition, we may be subject to potential legal proceedings arising out of our announcement of the Audit Committee investigation and/or findings of the investigation. Any future litigation, investigation or other actions that may be filed or initiated against us or our officers or directors, may be time consuming and expensive. We cannot predict what losses we may incur in these litigation matters, and contingencies related to our obligations under the federal and state securities laws, or in other legal proceedings or governmental investigations or proceedings related to these matters.

Previous report

Any legal proceedings, if decided adversely to us, could result in significant monetary damages, penalties and reputational harm, and will likely involve significant defense and other costs. We have entered into indemnification agreements with each of our directors and certain of our officers, and our Amended and Restated Bylaws require us to indemnify each of our directors and officers. Further, our insurance may not cover all claims that have been or may be brought against us, and insurance coverage may not continue to be available to us at a reasonable cost. As a result, we may be exposed to substantial uninsured liabilities, including pursuant to our indemnification obligations, which could adversely affect our business, prospects, results of operations and financial condition.

Previous report

The Company identified material weaknesses in the Company’s internal control over financial reporting, which could impact the Company’s ability to report its results of operations and financial condition accurately and in a timely manner.

Previous report

In connection with the Audit Committee investigation, the Company identified material weaknesses in the Company’s internal control over financial reporting. For a description of these material weaknesses, see “Controls and Procedures” in Part I, Item 4 of this report. While the Company has developed a remediation plan, the material weaknesses cannot be considered remediated until the applicable remedial control is implemented and operates for a sufficient period of time to allow management to conclude, through testing, that this remediation plan is implemented and the control is operating effectively. The material weaknesses, if not fully addressed, could result in a material misstatement of the Company’s annual or interim financial statements, and the Company may be unable to remediate these material weaknesses in a timely manner, which could adversely impact the accuracy and timeliness of future reports and filings the Company makes with the SEC. Any such failure could result in litigation or regulatory actions by the SEC or other regulatory authorities, which could further result in loss of investor confidence, a decline in the price of our common stock, delisting of our securities, harm to our reputation and financial condition and/or diversion of financial and management resources from the operation of our business.

Previous report

Key products generate a significant amount of our profits and cash flows, and any events that adversely affect the markets for our leading products could adversely affect our results of operations and financial condition.

Previous report

Our ability to generate profits and operating cash flow depends largely upon the continued profitability of our key products, such as Nexplanon, Arcoxia, Singulair and the ezetimibe family of products. As a result of our dependence on key products, any event that adversely affects any of these products or the markets for any of these products could adversely affect our sales, results of operations or cash flows. These adverse events could include increased costs associated with manufacturing, product shortages, increased generic or over-the-counter availability of our products or competitive products, the discovery of previously unknown side effects or enhanced safety warnings, results of post-approval trials, increased competition from the introduction of new, more effective treatments and discontinuation or removal from the market of these products for any reason. In addition, recent adverse market and political events could negatively impact our key products and/or our business, results of operation and financial condition as a whole. These recent adverse events may include, among other things, U.S. and

Previous report

-41- international tariffs or other protectionist trade measures, the recent changes to U.S. tax laws, healthcare and regulatory reforms, including those relating to insurance coverage, and other U.S. and international regulatory changes, including changes in regulatory enforcement landscape. We also expect that competition will continue to adversely affect the sales of our key products (including generic competition as a result of LOE in 2024 for Atozet and if we are unable to obtain an additional period of market exclusivity for Nexplanon).

Previous report

To address such adverse effects and remain competitive, we have and will continue to adapt our business and sales practices for wholesalers, particularly in connection with our key products. These business and sales practices for wholesalers have historically included product discount programs and discussing with wholesalers whether to increase their inventory levels either within or above the agreed upon product inventory levels under the relevant agreement terms or pursuant to waivers. In the United States, the current structure of our arrangements provides us with data on inventory levels at our wholesalers, which is closely monitored and reviewed with the goal of ensuring that inventory levels are appropriate and reasonable in the normal course of business. Additionally, with respect to markets outside of the United States, inventory levels are also reviewed to the extent information is available by market or customer type. However, even with available inventory data, if we do not accurately predict inventory levels or we otherwise determine that inventory levels of our wholesalers should increase due to either customer demand or demand generated via the sales practices for wholesalers, then this may result in the inventory of our wholesalers exceeding customer demand at the time. However, if demand does not keep pace with the additional inventory purchases, then channel inventory for such products could grow in any particular quarter, which could adversely affect corresponding product revenues and/or rate of returns, and could result in a greater amount of product expirations, reduced inventory purchases in subsequent months and/or product discounts being recorded in subsequent quarters. Moreover, if we choose to eliminate or adjust the use of these strategies or if wholesalers decrease their inventory levels, this could contribute to our quarterly and/or annual revenue failing to meet our expectations.

Previous report

Recent health care reform initiatives focused on the cost of prescription drugs may have a material adverse effect on our business and results of operations.

Previous report

Governments globally, as well as payors in the U.S., are increasingly using a variety of measures to control costs, including, among others, legislative or regulatory pricing reforms, drug formularies. In the United States, there have been significant and wide-ranging federal policy and legislative reforms impacting drug pricing and reimbursement. For example, in April 2025, the U.S. presidential administration issued an executive order with multiple directives aimed at lowering drug prices, including refining the Medicare drug price negotiation program established by the Inflation Reduction Act of 2022; accelerating competition for high-cost prescription drugs by accelerating approval of generics and biosimilars and facilitating the process for re-classifying prescription drugs as over-the-counter drugs; and increasing drug importation. In May 2025, the U.S. presidential administration issued another executive order that directed government agencies and officials to identify MFN pricing targets for prescription drugs (and looked to pharmaceutical manufacturers to make significant progress towards delivering target prices to patients); prevent foreign countries from disproportionately shifting the cost of global pharmaceutical research and development to the United States; and facilitate direct-to-consumer purchasing programs for pharmaceutical manufacturers to sell their products to patients at the MFN price. In addition, in July 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted into law. The OBBBA includes significant corporate tax provisions such as modifications to interest deductibility, the option to fully expense U.S.-based R&D costs, and changes to the taxation of foreign earnings. We expect to see continued focus by the U.S. government and states on regulating drug pricing and access to medicine, any of which could impair our ability to compete and have a material adverse impact on our business, financial condition, and results of operations.

Previous report

Reduction in Size of Board

Previous report

In connection with the circumstances described in Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Recent Developments — Internal Investigation Relating to Internal Control Over Financial Reporting,” on October 26, 2025, Kevin Ali resigned as Chief Executive Officer of the Company and as a member of the Board. As a result, on October 26, 2025, the Board reduced the size of the Board from 12 to 11 directors. As a result of such reduction, there are currently no vacancies on the Board.