Organon & Co.

Previous wording

Some statements and disclosures in this document are forward-looking statements. Forward-looking statements include all statements that do not relate solely to historical or current facts and can be identified by the use of words such as “may,” “believe,” “will,” “expect,” “project,” “potential,” “possible,” “probable,” “outcome,” “likely,” “could,” “should,” “estimate,” “anticipate,” “plan,” “intend,” “would,” “future,” “target,” “seek,” “continue,” and other words of similar meaning, or negative variations of any of the foregoing. These forward-looking statements are based on our current plans and expectations and are subject to a number of risks and uncertainties that could cause our plans and expectations, including actual results, to differ materially from the forward-looking statements. Risks and uncertainties that may affect our future results include, but are not limited to, uncertainties as to the timing of the completion of the pending merger (the “merger”) with Sun Pharmaceutical Industries (together with its subsidiaries and/or associated companies, “Sun Pharma”); the risk that the merger may not be completed on the anticipated terms in a timely manner or at all; the failure to satisfy any of the conditions to the consummation of the merger, including receiving, on a timely basis or otherwise, the minimum vote required by our stockholders to approve the merger; the possibility that competing offers or acquisition proposals for Organon will be made; the possibility that any or all of the various conditions to the consummation of the merger may not be satisfied or waived, including the failure to receive any required regulatory approvals from any applicable governmental entities (or any conditions, limitations or restrictions placed on such approvals); the occurrence of any event, change or other circumstance that could give rise to the termination of the definitive agreement, including in circumstances which would require us to pay a termination fee; the effect of the announcement or pendency of the merger on our ability to retain and hire key personnel, our ability to maintain relationships with our customers, suppliers and others with whom we do business, or our operating results and business generally; risks related to diverting management’s attention from our ongoing business operations; the risk that stockholder litigation in connection with the merger may result in significant costs of defense, indemnification and liability; certain restrictions during the pendency of the merger that may impact our ability to pursue certain business opportunities or strategic transactions; the risk that any announcements relating to the merger could have adverse effects on the market price of our common stock, including if the merger is not consummated; risks that the benefits of the merger are not realized when and as expected; expanded brand and class competition in the markets in which we operate; trade protection measures and import or export…

Excerpt shortened here; the source contains the full paragraph.

Current wording

Some statements and disclosures in this document are forward-looking statements. Forward-looking statements include all statements that do not relate solely to historical or current facts and can be identified by the use of words such as “may,” “believe,” “will,” “expect,” “project,” “potential,” “possible,” “probable,” “outcome,” “likely,” “could,” “should,” “estimate,” “anticipate,” “plan,” “intend,” “would,” “future,” “target,” “seek,” “continue,” and other words of similar meaning, or negative variations of any of the foregoing. These forward-looking statements are based on our current plans and expectations and are subject to a number of risks and uncertainties that could cause our plans and expectations, including actual results, to differ materially from the forward-looking statements. Risks and uncertainties that may affect our future results include, but are not limited to, uncertainties as to the timing of the proposed transaction with Sun Pharmaceutical Industries Limited (together with its subsidiaries and/or associated companies, “Sun Pharma”); the risk that the proposed transaction may not be completed on the anticipated terms in a timely manner or at all; the possibility that competing offers or acquisition proposals for Organon will be made; the possibility that any or all of the remaining conditions to the consummation of the proposed transaction may not be satisfied or waived, including the failure to receive any required regulatory approvals from any applicable governmental entities (or any conditions, limitations or restrictions placed on such approvals); the occurrence of any event, change or other circumstance that could give rise to the termination of the definitive agreement, including in circumstances that would require us to pay a termination fee; the effect of the pendency of the proposed transaction on our ability to retain and hire key personnel, our ability to maintain relationships with our customers, suppliers and others with whom we do business, or our operating results and business generally; risks related to diverting management’s attention from our ongoing business operations; the risk that stockholder litigation in connection with the proposed transaction may result in significant costs of defense, indemnification and liability; certain restrictions during the pendency of the proposed transaction that may impact our ability to pursue certain business opportunities or strategic transactions; the risk that any announcements relating to the proposed transaction could have adverse effects on the market price of our common stock, including if the proposed transaction is not consummated; risks that the benefits of the proposed transaction are not realized when and as expected; expanded brand and class competition in the markets in which we operate; trade protection measures and import or export licensing requirements, including the direct and indirect impacts of tariffs (including pharmaceutical sector tariffs), tra…

Excerpt shortened here; the source contains the full paragraph.

Previous wording

-23- reliance on fewer research and development programs for new products to generate future revenue and replace existing products that come to the end of their market life cycle; future actions of third-parties, including significant changes in customer relationships or changes in the behavior and spending patterns of purchasers of healthcare products and services, including delaying medical procedures, rationing prescription medications, reducing the frequency of physician visits and forgoing healthcare insurance coverage; legal factors, such as product liability claims, stockholder litigation, governmental investigations, and patent disputes; lost market opportunity resulting from delays and uncertainties in clinical trials and the approval or clearance process of the FDA and other regulatory authorities; the failure by us or our third party collaborators and/or their suppliers to fulfill our or their regulatory or quality obligations, which could lead to a delay in regulatory approval or commercial marketing of our products; cyberattacks on, or other failures, accidents, or security breaches of, our or third-party providers’ information technology systems, which could disrupt our operations and those of third parties upon which we rely; increased focus on privacy issues in countries around the world, including the United States, the European Union, and China, and a more difficult legislative and regulatory landscape for privacy and data protection that continues to evolve with the potential to directly affect our business, including recently enacted laws in a majority of states in the United States requiring security breach notification; changes in tax laws including changes related to the taxation of foreign earnings; the impact of any future pandemic, epidemic, or similar public health threat on our business, operations and financial performance; changes in accounting pronouncements promulgated by standard-setting or regulatory bodies, including the Financial Accounting Standards Board and the SEC, that are adverse to us; volatility of commodity prices, fuel, and shipping rates that impact the costs and/or ability to supply our products; and other factors discussed in our most recently filed Annual Report on Form 10-K and subsequent filings, including those discussed in the “Business,” “Risk Factors,” “Cautionary Statement Regarding Forward-Looking Statements” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of those reports.

Current wording

-26- frequency of physician visits and forgoing healthcare insurance coverage; legal factors, such as product liability claims, stockholder litigation, governmental investigations, and patent disputes; lost market opportunity resulting from delays and uncertainties in clinical trials and the approval or clearance process of the FDA and other regulatory authorities; the failure by us or our third party collaborators and/or their suppliers to fulfill our or their regulatory or quality obligations, which could lead to a delay in regulatory approval or commercial marketing of our products; cyberattacks on, or other failures, accidents, or security breaches of, our or third-party providers’ information technology systems, which could disrupt our operations and those of third parties upon which we rely; increased focus on privacy issues in countries around the world, including the United States, the European Union, and China, and a more difficult legislative and regulatory landscape for privacy and data protection that continues to evolve with the potential to directly affect our business, including recently enacted laws in a majority of states in the United States requiring security breach notification; changes in tax laws including changes related to the taxation of foreign earnings; the impact of any future pandemic, epidemic, or similar public health threat on our business, operations and financial performance; changes in accounting pronouncements promulgated by standard-setting or regulatory bodies, including the Financial Accounting Standards Board and the SEC, that are adverse to us; volatility of commodity prices, fuel, and shipping rates that impact the costs and/or ability to supply our products; and other factors discussed in our most recently filed Annual Report on Form 10-K, Quarterly Report on Form 10-Q, and subsequent filings, including those discussed in the “Business,” “Risk Factors,” “Cautionary Statement Regarding Forward-Looking Statements” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of those reports.

Previous wording

On February 19, 2026, we entered into an exclusive license agreement with Sebela for the global rights to Miudella, a hormone-free copper intrauterine device (“IUD”) that was approved by the FDA on February 24, 2025. Under the terms of the agreement, we will pay $27.5 million at closing, with potential sales-based milestone payments of up to $505 million, as well as tiered double-digit royalties based on net sales. The transaction closing is subject to regulatory approvals and FDA approval of alternate supply chain entities for Miudella, and other customary closing conditions. There can be no assurance that such regulatory approvals and other closing conditions will be received or satisfied.

Current wording

On February 19, 2026, we entered into an exclusive license agreement with Sebela for the global rights to Miudella®, a hormone-free copper intrauterine device (“IUD”) that was approved by the FDA on February 24, 2025 and is estimated to launch commercials sales in the United States in late 2026. Under the terms of the agreement, we paid $27.5 million in June 2026, with potential sales-based milestone payments of up to $505 million, and tiered double-digit royalties based on net sales. In the second quarter of 2026, the Company recognized an intangible asset of $27.5 million.

Previous wording

In January 2026, we divested the Jada System to Laborie for an aggregate payment of up to $465 million, comprised of consideration of $440 million, subject to certain closing adjustments, plus potential contingent consideration payments of up to $25 million based on the achievement of certain 2026 net sales targets. Approximately 100 employees transferred to Laborie as part of this transaction.

Current wording

In January 2026, we divested the Jada System to Laborie for an aggregate payment of up to $465 million, comprised of consideration of $440 million, subject to certain closing adjustments, plus potential contingent consideration payments of up to $25 million based on the achievement of certain 2026 net sales targets. Approximately 100 Company employees transferred to Laborie as part of this transaction.

Previous wording

Upon the closing of the divestiture, we recognized a net gain on the sale of the Jada System of $81 million recognized in Other (income) expense, net in the Condensed Consolidated Statement of Income as of March 31, 2026.

Current wording

Upon the closing of the divestiture, we recognized a net gain on the sale of the Jada System of $81 million recognized in Other expense (income), net in the Condensed Consolidated Statement of Income for the six months ended June 30, 2026.

Previous wording

Excluding the impact of foreign exchange rates, sales decreases for the three months ended March 31, 2026, primarily reflect lower sales of:

Current wording

Excluding the impact of foreign exchange rates, sales decreases for the three months ended June 30, 2026 primarily reflect the lower sales of:

Previous wording

•Singulair® (montelukast sodium), primarily attributable to decreased demand due to less favorable medical guidelines in certain international markets, most recently in China, as well as temporary supply constraints in Japan and mandatory price reductions in China and Japan;

Current wording

•Singulair® (montelukast sodium), primarily attributable to decreased demand due to less favorable medical guidelines in certain international markets, most recently in China, as well as temporary supply constraints in Japan and mandatory price reductions in China and Japan; and

Previous wording

The foregoing decrease was partially offset by sales increases for the three months ended March 31, 2026 in:

Current wording

This performance was offset by sales increases for the three months ended June 30, 2026 in:

Previous wording

Worldwide sales were $1.5 billion for the three months ended March 31, 2026, a decrease of 4%, compared to 2025. Worldwide sales during the three months ended March 31, 2026 were positively impacted by approximately $76 million, or approximately 5%, due to favorable foreign exchange rates.

Current wording

Worldwide sales were $3.0 billion for the six months ended June 30, 2026, a decrease of 3%, compared to 2025. Worldwide sales during the six months ended June 30, 2026 were positively impacted by approximately $118 million, or approximately 4%, due to favorable foreign exchange rates.

Previous wording

•Nexplanon, primarily due to decreased physician demand in the United States following the five-year label approval as reinsertions have been delayed and there has been uncertainty around federal funding. Outside of the U.S., sales declined due to the timing of shipments in selective emerging markets, partially offset by increased demand and access in Brazil;

Current wording

•Nexplanon, primarily due to decreased physician demand in the United States following the five-year label approval as reinsertions have been delayed and there has been uncertainty around federal funding;

Previous wording

Loss of exclusivity (“LOE”) negatively impacted sales of certain of our products by approximately $4 million during the three months ended March 31, 2026, based on the decrease in sales volume compared to 2025. Volume-based procurement (“VBP”) in China negatively impacted sales by approximately $2 million during the three months ended March 31, 2026. We expect VBP to continue to negatively impact our general medicines product portfolio for the next several quarters.

Current wording

Loss of exclusivity (“LOE”) negatively impacted sales of certain of our products by approximately $6 million and $10 million during the three and six months ended June 30, 2026, respectively, based on the decrease in sales volume of those products compared to 2025. Volume-based procurement (“VBP”) in China negatively impacted sales by approximately $5 million and $7 million during the three and six months ended June 30, 2026, respectively. We expect VBP to continue to negatively impact our general medicines product portfolio for the next several quarters.

Previous wording

Due to changing market conditions, including ongoing conflicts, new and evolving U.S. and international tariffs, U.S. tax law changes and regulatory uncertainty that impact our business, as well as the pharmaceutical industry, we have been and will continue to adapt our business and sales strategies to address this changing landscape in order to achieve our business objectives and remain competitive. Such strategies may include implementing or continuing to assess product discount programs and wholesaler inventory levels under the relevant agreements or waivers of their terms for certain key products.

Current wording

Due to changing market conditions, including ongoing regional conflicts in the Middle East and elsewhere, new and evolving U.S. and international tariffs, U.S. tax law changes and regulatory uncertainty that impact our business, as well as the pharmaceutical industry, we have been and will continue to adapt our business and sales strategies to address this changing

Previous wording

Highlights of the sales of our products for the three months ended March 31, 2026 and 2025 are provided below. See Note 5 “Product and Geographic Information” to the Condensed Consolidated Financial Statements for further details on sales of our products.

Current wording

Highlights of the sales of our products for the three and six months ended June 30, 2026 and 2025 are provided below. See Note 5 “Product and Geographic Information” to the Condensed Consolidated Financial Statements for further details on sales of our products.

Previous wording

Worldwide sales of Nexplanon, a single-rod subdermal contraceptive implant, declined 19% for the three months ended March 31, 2026, compared to 2025, primarily due to decreased physician demand in the United States following the five-year label approval as reinsertions have been delayed and there has been uncertainty around federal funding. In 2025, we submitted a similar application for a five-year duration period of use to the EU and UK Health Authorities. The application for five-year duration was approved for UK in April, 2026. The EU application is currently under review, with potential approval in 2027, subject to health authority review and approval. Outside of the U.S., sales declined due to the timing of shipments in selective emerging markets, partially offset by increased demand and access in Brazil.

Current wording

Worldwide sales of Nexplanon, a single-rod subdermal contraceptive implant, declined 4% and 12% for the three and six months ended June 30, 2026, compared to 2025, respectively, primarily due to decreased physician demand in the United States following the five-year label approval as reinsertions have been delayed and there has been uncertainty around federal funding. We estimate that expanding use from the new label will begin to favorably offset the reinsertion headwind beginning in the second half of 2026. In 2025, we submitted a similar application for a five-year duration period of use to the EU and UK Health Authorities. The application for five-year duration was approved for the UK in April, 2026. The EU application is currently under review, with potential approval in 2027, subject to health authority review and approval. Outside of the U.S., sales were positively impacted by increased demand and access in Brazil, which we expect to continue for the remainder of 2026.

Previous wording

Worldwide sales of NuvaRing, a vaginal contraceptive product, increased 10% for the three months ended March 31, 2026, compared to 2025, due to the favorable impact of foreign exchange and lower discount rates in the United States.

Current wording

Worldwide sales of NuvaRing, a vaginal contraceptive product, declined 4% for the three months ended June 30, 2026, compared to 2025, due to decreased demand in various international markets, partially offset by lower discount rates in the United States. Sales of NuvaRing, increased 2% for the six months ended June 30, 2026, compared to 2025, due to the favorable impact of foreign exchange and lower discount rates in the United States, offset by decreased demand in various international markets.

Previous wording

Worldwide sales of Marvelon and Mercilon, combined oral hormonal daily contraceptive pills not approved or marketed in the United States, but available in certain countries outside the United States, declined 34% for the three months ended March 31, 2026, compared to 2025, as a result of decreased demand and market contraction in China and the timing of shipments in Asia Pacific.

Current wording

Worldwide sales of Marvelon™¹ (desogestrel and ethinyl estradiol pill) and Mercilon™¹ (desogestrel and ethinyl estradiol pill), combined oral hormonal daily contraceptive pills not approved or marketed in the United States, but available in certain countries outside the United States, declined 4% and 20% for the three and six months ended June 30, 2026, compared to 2025, respectively, as a result of decreased demand and market contraction in China and the timing of shipments in Asia Pacific. In the second quarter of 2026, we received regulatory approval in Japan for Mercilon Combination Tablets, a low-dose estrogen-progestin (LEP) product for the treatment of dysmenorrhea.

Previous wording

In January 2026, we completed the sale of the Jada System to Laborie. As a result, worldwide sales of Jada, a device intended to provide control and treatment of abnormal postpartum uterine bleeding or hemorrhage when conservative management is warranted, declined 66% for the three months ended March 31, 2026, compared to 2025.

Current wording

In January 2026, we completed the sale of the Jada System to Laborie and, thereafter, we were no longer actively selling the Jada System. As a result, worldwide sales of Jada, a device intended to provide control and treatment of abnormal postpartum uterine bleeding or hemorrhage when conservative management is warranted, significantly declined for the three and six months ended June 30, 2026, compared to 2025, respectively.

Previous wording

Renflexisis a biosimilar to Remicade 2(infliximab) for the treatment of certain autoimmune conditions. Sales increased 1% for the three months ended March 31, 2026, compared to 2025, primarily due to favorable foreign exchange and increased demand in Canada partially offset by the competitive pressure and unfavorable discount rates in the United States.

Current wording

Renflexisis a biosimilar to Remicade 2(infliximab) for the treatment of certain autoimmune conditions. Sales increased 4% and 2% for the three and six months ended June 30, 2026, compared to 2025, respectively, primarily due to increased demand in Canada, partially offset by competitive pressure and unfavorable discount rates in the United States.

Previous wording

Hadlima is a biosimilar to Humira 2 (adalimumab) for the treatment of certain autoimmune and autoinflammatory conditions. Sales increased 44% for the three months ended March 31, 2026, compared to 2025, due to stronger demand in the United States and increased demand in Puerto Rico. We have commercialization rights to Hadlima in countries outside of the European Union, South Korea, China, Turkey, and Russia. Hadlima is currently approved in the United States, Australia, Canada and Israel.

Current wording

Hadlima is a biosimilar to Humira 2 (adalimumab) for the treatment of certain autoimmune and autoinflammatory conditions. Sales increased 59% and 51% for the three and six months ended June 30, 2026, compared to 2025, respectively, due to stronger demand in the United States and Puerto Rico. We have commercialization rights to Hadlima in countries outside of the European Union, South Korea, China, Turkey, and Russia. Hadlima is currently approved in the United States, Australia, Canada, and Israel.

Previous wording

Ontruzant is a biosimilar to Herceptin 2(trastuzumab) for the treatment of HER2-overexpressing breast cancer and HER2-overexpressing metastatic gastric or gastroesophageal junction adenocarcinoma. Sales for the three months ended March 31, 2026, compared to 2025, declined 71%, due to increased competition in international markets and lower tendered volume from Brazil’s Ministry of Health when compared with the same period in 2025. We have commercialization rights to Ontruzant in all countries except in South Korea and China.

Current wording

Ontruzant is a biosimilar to Herceptin 2(trastuzumab) for the treatment of HER2-overexpressing breast cancer and HER2-overexpressing metastatic gastric or gastroesophageal junction adenocarcinoma. Sales for the three and six months ended June 30, 2026, compared to 2025, declined 81% and 77%, respectively, due to lower tendered volume from Brazil’s Ministry of Health when compared with the same period in 2025. We have commercialization rights to Ontruzant in all countries except in South Korea and China.

Previous wording

Brenzys is a biosimilar to Enbrel 2 (etanercept) for the treatment of certain inflammatory diseases. Sales for the three months ended March 31, 2026, compared to 2025, increased 39%, as a result of the timing of prior year tenders in Brazil. We have commercialization rights to Brenzys in countries outside of the United States, Europe, South Korea, China, and Japan.

Current wording

Brenzys is a biosimilar to Enbrel 2 (etanercept) for the treatment of certain inflammatory diseases. Sales for the three and six months ended June 30, 2026, compared to 2025, declined 34% and 5%, respectively, as a result of the timing of shipments in Brazil. We have commercialization rights to Brenzys in countries outside of the United States, Europe, South Korea, China, and Japan.

Previous wording

Sales of Atozet, a medicine for lowering LDL cholesterol, increased 11% for the three months ended March 31, 2026, compared to 2025, primarily due to increased demand in China, due to the product launch in 2025, and in Asia Pacific as well as volume uptake in certain countries in Europe, partially offset by unfavorable pricing in Europe.

Current wording

Sales of Atozet™¹ (ezetimibe and atorvastatin), a medicine for lowering LDL cholesterol, decreased 7% for the three months ended June 30, 2026 compared to 2025, due to unfavorable pricing in Europe, partially offset by increased demand in Korea. Sales of Atozet increased 1% for the six months ended June 30, 2026, compared to 2025, primarily due to favorable foreign exchange, increased demand in China, due to the product launch in 2025, in Asia Pacific and Korea as well as volume uptake in certain countries in Europe, partially offset by unfavorable pricing in Europe.

Previous wording

Combined global sales of Zetia® (ezetimibe), which is marketed as Ezetrol™in most countries outside the United States; and Vytorin® (ezetimibe / simvastatin), which is marketed as Inegy™ outside the United States, medicines for lowering LDL cholesterol, increased 1% for the three months ended March 31, 2026, compared to 2025, primarily driven by favorable foreign exchange and increased demand in China, partially offset by less tender volume and the timing of shipments in the Middle East.

Current wording

Combined global sales of Zetia, which is marketed as Ezetrol™in most countries outside the United States; and of Vytorin, which is marketed as Inegy™ outside the United States, which are medicines for lowering LDL cholesterol, increased 16% and 8% for the three and six months ended June 30, 2026, compared to 2025, respectively, primarily driven by increased demand in China.

Previous wording

Combined global sales of Cozaar® (losartan) and Hyzaar® (losartan / hydrochlorothiazide), medicines for the treatment of hypertension, increased 4% for the three months ended March 31, 2026, compared to 2025, driven by favorable foreign exchange and increased demand in China, partially offset by decreased demand in various international markets.

Current wording

Combined global sales of Cozaar® (losartan) and Hyzaar® (losartan / hydrochlorothiazide), which are medicines for the treatment of hypertension, declined 10% and 3% for the three and six months ended June 30, 2026, compared to 2025, respectively, driven by decreased demand in various international markets.

Previous wording

Worldwide sales of Singulair, a once-a-day oral medicine for the chronic treatment of asthma and for the relief of symptoms of allergic rhinitis, declined 46% for the three months ended March 31, 2026, compared to 2025. This decline was primarily attributable to decreased demand due to less favorable medical guidelines in certain international markets, most recently in China, as well as temporary supply constraints in Japan and mandatory price reductions in China and Japan.

Current wording

Worldwide sales of Singulair, a once-a-day oral medicine for the chronic treatment of asthma and for the relief of symptoms of allergic rhinitis, declined 27% and 37% for the three and six months ended June 30, 2026, compared to 2025, respectively. This decline during these periods was primarily attributable to decreased demand due to less favorable medical guidelines in certain international markets, most recently in China, as well as temporary supply constraints in Japan and mandatory price reductions in China and Japan.

Previous wording

Global sales of Nasonex, an inhaled nasal corticosteroid for the treatment of nasal allergy symptoms, declined 9% for the three months ended March 31, 2026, compared to 2025, due to competitive pressure in various international markets.

Current wording

Global sales of Nasonex® (mometasone furoate), an inhaled nasal corticosteroid for the treatment of nasal allergy symptoms, declined 12% and 10% for the three and six months ended June 30, 2026, compared to 2025, respectively, due to competitive pressure in various international markets.

Previous wording

Global sales of Dulera® (formoterol/fumarate dihydrate), which is also marketed as Zenhale in certain markets outside of the United States, a combination medicine for the treatment of asthma, declined 20% for the three months ended March 31, 2026, compared to 2025, primarily due to increased discount rate pressure and decreased demand in the United States.

Current wording

Global sales of Dulera® (formoterol/fumarate dihydrate), which is also marketed as Zenhale™in certain markets outside of the United States, a combination medicine for the treatment of asthma, increased 1% for the three months ended June 30, 2026, compared to 2025, primarily due to the favorable impact of foreign exchange, offset by decreased demand in the United States. Global sales of Dulera declined 10% for the six months ended June 30, 2026, compared to 2025, primarily due to decreased demand in the United States.

Previous wording

Sales of Arcoxia™¹ (etoricoxib), a medicine for the treatment of arthritis and pain, declined 5% for the three months ended March 31, 2026, compared to 2025, primarily due to the phasing of shipments in various international regions and decreased demand in China.

Current wording

Sales of Arcoxia™¹ (etoricoxib), a medicine for the treatment of arthritis and pain, increased 11% and 3% for the three and six months ended June 30, 2026, compared to 2025, due to increased demand in China and the phasing of shipments in various international regions.

Previous wording

Sales of Vtama, a cream for the topical treatment of mild, moderate, and severe plaque psoriasis in adults and atopic dermatitis, also known as eczema, in adults and children two years of age and older, increased 5% for the three months ended March 31, 2026, compared to 2025, due to increased demand and favorable discount rates in the United States. We anticipate launching Vtama in certain international markets in 2026 and beyond, subject to health authority reviews and approvals.

Current wording

Sales of Vtama, a cream for the topical treatment of mild, moderate, and severe plaque psoriasis in adults and atopic dermatitis, also known as eczema, in adults and children two years of age and older, increased 15% and 11% for the three and six months ended June 30, 2026, compared to 2025, respectively, due to increased demand and favorable discount rates in the United States, partially offset by lower demand in Japan. We anticipate launching Vtama in certain international markets in 2026 and beyond, subject to health authority reviews and approvals.

Previous wording

Sales of Emgality, a medicine for the preventive treatment of migraine, increased 69% for the three months ended March 31, 2026, compared to 2025, as a result of continued uptake following the acquisition of the distribution and promotion rights from Lilly in January of 2024 in certain markets outside of the United States.

Current wording

Sales of Emgality, a medicine for the preventive treatment of migraine, increased 27% and 45% for the three and six months ended June 30, 2026, compared to 2025, respectively, as a result of increased demand in various international markets.

Previous wording

Cost of sales increased 1% for the three months ended March 31, 2026, compared to 2025, driven by our product mix. Cost of sales for the three months ended March 31, 2026 compared to 2025, includes amortization associated with the inventory fair value adjustment related to the Dermavant acquisition of $7 million and $9 million, respectively, and amortization of intangible assets of $47 million and $50 million, respectively.

Current wording

Cost of sales decreased 1% and less than 1% for the three and six months ended June 30, 2026, compared to 2025, respectively, driven by our product mix and the impact of unfavorable foreign exchange. Cost of sales for the three and six months ended June 30, 2026 includes amortization associated with the inventory fair value adjustment related to the Dermavant acquisition of $0 and $7 million, respectively, and amortization of intangible assets of $46 million and $93 million, respectively. Cost of sales for the three and six months ended June 30, 2025, includes amortization associated with the inventory fair value adjustment related to the Dermavant acquisition of $10 million and $19 million, respectively, an impairment charge related to a currently marketed women’s health product of $9 million and amortization of intangible assets of $53 million and $103 million, respectively.

Previous wording

Gross profit decreased 7% for the three months ended March 31, 2026, compared to 2025, due to the impact of unfavorable pricing and product mix and unfavorable foreign exchange.

Current wording

Gross profit decreased 3% and 5% for the three and six months ended June 30, 2026, compared to 2025, respectively, due to the impact of unfavorable volume, pricing and product mix and unfavorable foreign exchange.

Previous wording

Research and development expenses decreased 3% for the three months ended March 31, 2026, compared to 2025, primarily due to a decrease in clinical study activity. During 2025, we discontinued the clinical development programs for investigational candidates OG-6219 and OG-7191.

Current wording

Research and development expenses decreased 5% for each of the three and six months ended June 30, 2026, compared to 2025, primarily due to reduced headcount-related costs related to our restructuring initiatives and a decrease in clinical study activity. During 2025, we discontinued the clinical development programs for investigational candidates OG-6219 and OG-7191.

Previous wording

For the three months ended March 31, 2025, we recognized $6 million in acquired in-process research and development and milestones, related to the exit of our agreement with Centergene, due to the evolving fertility landscape in China.

Current wording

For the six months ended June 30, 2025, we recognized $6 million in acquired in-process research and development and milestones, related to the exit of our agreement with Suzhou Centergene Pharmaceuticals, due to the evolving fertility landscape in China.

Previous wording

For the three months ended March 31, 2026, we incurred restructuring costs of $31 million related to our 2026 restructuring initiatives to streamline and optimize our research and development and manufacturing operations, focusing on enhancing efficiency and aligning resources with strategic priorities. For the three months ended March 31, 2025, we incurred restructuring costs of $86 million, comprised primarily of headcount-related restructuring expense associated with restructuring initiatives that were aimed at driving operational efficiencies in 2025.

Current wording

For the six months ended June 30, 2026, we incurred restructuring costs of $31 million related to our 2026 restructuring initiatives to streamline and optimize our research and development and manufacturing operations, focusing on enhancing efficiency and aligning resources with strategic priorities. For the six months ended June 30, 2025, we incurred restructuring costs of $88 million, comprised primarily of headcount-related restructuring expense associated with restructuring initiatives that were aimed at driving operational efficiencies in 2025.

Previous wording

Interest expense decreased 10% for the three months ended March 31, 2026, compared to 2025, due to the repurchase and cancellation of approximately $419 million of the Company’s 5.125% notes due in 2031 (“the 2031 Notes”) during the second and fourth quarters of 2025 combined with lower reference rates on our variable rate debt.

Current wording

Interest expense decreased 18% and 14% for the three and six months ended June 30, 2026, compared to 2025, respectively, due to the repurchase and cancellation of approximately $419 million of the Company’s 5.125% notes due in 2031 (the “2031 Notes”) during the second and fourth quarters of 2025, mandatory prepayments to our term loans in the first quarter of 2026 and lower reference rates on our USD-denominated variable rate debt.

Previous wording

Exchange losses (gains) were unfavorable for the three months ended March 31, 2026, compared to 2025, primarily due to unfavorable movements in certain foreign currencies relative to the U.S. dollar.

Current wording

Exchange losses (gains) were unfavorable for the three and six months ended June 30, 2026, compared to 2025, respectively primarily due to unfavorable movements in certain foreign currencies relative to the U.S. dollar.

Previous wording

Other (income) expense, net was impacted for the year ended March 31, 2026, by an $81 million net gain related to the divestiture of the Jada System to Laborie in the first quarter of 2026 and $7 million related to the accretion of the Dermavant acquisition contingent consideration, related to changes in the timing of expected commercial milestones based on updated sales forecasts.

Current wording

Other expense (income), net was impacted for the three months ended June 30, 2026, by $17 million due to an unfavorable resolution of a working capital matter related to the Dermavant acquisition and $9 million related to the fair value adjustments and accretion of the Dermavant acquisition contingent consideration, related to changes in the timing of expected commercial milestones based on updated sales forecasts. Other expense (income), net was impacted for the six months ended June 30, 2026, by an $81 million net gain related to the divestiture of the Jada System to Laborie in the first quarter of 2026, $17 million due to an unfavorable resolution of a working capital matter related to the Dermavant acquisition and $4 million related to the fair value adjustments and accretion of the Dermavant acquisition contingent consideration, related to changes in the timing of expected commercial milestones based on updated sales forecasts.

Previous wording

The effective income tax rates were 31.4% and 13.4% for the three months ended March 31, 2026 and 2025, respectively. These effective income tax rates reflect the beneficial impact of foreign earnings, offset by the impact of U.S. inclusions under the Global Intangible Low-Taxed Income regime and a valuation allowance recorded against non-deductible U.S. interest expense. Also included in the first quarter tax rate, is the beneficial impact of the sale of the Jada System. There was a favorable impact to the 2025 year-to-date effective tax rate driven by a tax amortization benefit.

Current wording

The effective income tax rates were 36.0% and 29.8% for the six months ended June 30, 2026 and 2025, respectively. These effective income tax rates reflect the beneficial impact of foreign earnings, offset by the impact of U.S. inclusions under the Global Intangible Low-Taxed Income regime and a valuation allowance recorded against non-deductible U.S. interest expense. Also included in the six month tax rate is the beneficial impact of the sale of the Jada System. There was a favorable impact to the 2025 year-to-date effective tax rate driven by a tax amortization benefit.

Previous wording

As of March 31, 2026, we had cash and cash equivalents of $1.12 billion. We have historically generated and expect to continue to generate positive cash flow from operations. Our ability to fund our operations and anticipated capital needs is reliant upon the generation of cash from operations, supplemented as necessary by periodic utilization of our revolving credit facility. Our principal uses of cash in the future will be primarily to fund our operations, working capital needs, capital expenditures, repayment of borrowings, strategic business development transactions and the payment of dividends. We believe that our financing arrangements, future cash from operations, and access to capital markets will provide adequate resources to fund our future cash flow needs. Our ability to raise new capital or refinance our debt, will depend on the capital markets and our financial condition at such times.

Current wording

As of June 30, 2026, we had cash and cash equivalents of $1.13 billion. We have historically generated and expect to continue to generate positive cash flow from operations. Our ability to fund our operations and anticipated capital needs is reliant upon the generation of cash from operations, supplemented as necessary by periodic utilization of our revolving credit facility. Our principal uses of cash in the future will be primarily to fund our operations, working capital needs, capital expenditures, repayment of borrowings, strategic business development transactions and the payment of dividends. We believe that our financing arrangements, future cash from operations, and access to capital markets will provide adequate resources to fund our future cash flow needs. Our ability to raise new capital or refinance our debt, will depend on the capital markets and our financial condition at such times.