Viatris Inc

Previous wording

This discussion and analysis should be read in conjunction with the Consolidated Financial Statements, the related Notes to Consolidated Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in Viatris’ 2024 Form 10-K, the unaudited interim financial statements and related Notes included in Part I — Item 1 of this Form 10-Q and our other SEC filings and public disclosures. The interim results of operations and comprehensive (loss) earnings for the three and nine months ended September 30, 2025, and cash flows for the nine months ended September 30, 2025 are not necessarily indicative of the results to be expected for the full fiscal year or any other future period.

Current wording

This discussion and analysis should be read in conjunction with the Consolidated Financial Statements, the related Notes to Consolidated Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in Viatris’ 2025 Form 10-K, the unaudited interim financial statements and related Notes included in Part I — Item 1 of this Form 10-Q and our other SEC filings and public disclosures. The interim results of operations and comprehensive earnings (loss) for the three months ended March 31, 2026, and cash flows for the three months ended March 31, 2026 are not necessarily indicative of the results to be expected for the full fiscal year or any other future period.

Previous wording

This Form 10-Q contains “forward-looking statements”. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements may include, without limitation, statements aboutthe goals or outlooks with respect to the Company’s strategic initiatives and priorities, including but not limited to divestitures, acquisitions, strategic alliances, collaborations, or other potential transactions; the benefits and synergies of such divestitures, acquisitions, strategic alliances, collaborations, or other transactions, or restructuring programs; future opportunities for the Company and its products; and any other statements regarding the Company’s future operations, financial or operating results, capital allocation, dividend policy and payments, share repurchases, debt ratio and covenants, anticipated business levels, future earnings, planned activities, anticipated growth, market opportunities, strategies, competitions, commitments, confidence in future results, efforts to create, enhance or otherwise unlock value, and other expectations and targets for future periods. Forward-looking statements may often be identified by the use of words such as “will”, “may”, “could”, “should”, “would”, “project”, “believe”, “anticipate”, “expect”, “plan”, “estimate”, “forecast”, “potential”, “pipeline”, “intend”, “continue”, “target”, “seek” and variations of these words or comparable words. Because forward-looking statements inherently involve risks and uncertainties, actual future results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to:

Current wording

This Form 10-Q contains “forward-looking statements”. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements may include, without limitation, statements aboutthe goals or outlooks with respect to the Company’s strategic initiatives and priorities, including but not limited to divestitures, acquisitions, strategic alliances, collaborations, or other potential transactions; the anticipated benefits of such strategic initiatives or priorities or restructuring activities; future opportunities for the Company and its products; the outcomes of clinical trials and research studies; R&D and new product development; and any other statements regarding the Company’s future operations, financial or operating results, capital allocation, dividend policy and payments, share repurchases, debt ratio and covenants, anticipated business levels, future earnings, planned activities, anticipated growth, market opportunities, strategies, imperatives, competitions, commitments, confidence in future results, efforts to create, enhance or otherwise unlock value, and other expectations and targets for future periods. Forward-looking statements may often be identified by the use of words such as “will”, “may”, “could”, “should”, “would”, “project”, “believe”, “anticipate”, “expect”, “plan”, “estimate”, “forecast”, “potential”, “pipeline”, “intend”, “continue”, “target”, “seek” and variations of these words or comparable words. Because forward-looking statements inherently involve risks and uncertainties, actual future results may differ materially from those expressed or implied by such forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to:

Previous wording

•the possibility that the Company may not realize the intended benefits of, or achieve the intended goals or outlooks with respect to, its strategic initiatives and priorities (including divestitures, acquisitions, strategic alliances, collaborations, or other potential transactions) or accelerate its growth by building on the strength of its base business with an expanding portfolio of innovative, best-in-class, patent-protected assets;

Current wording

•the possibility that the Company may not realize the intended benefits of, or achieve the intended goals or outlooks with respect to, its strategic initiatives and priorities;

Previous wording

•the possibility that the Company may be unable to achieve intended or expected benefits, goals, outlooks, synergies, growth opportunities and operating efficiencies in connection with divestitures, acquisitions, strategic alliances, collaborations, or other transactions, or restructuring programs, within the expected timeframes or at all;

Current wording

•the possibility that the Company may be unable to achieve intended or expected benefits in connection with divestitures, acquisitions, strategic alliances, collaborations, or other transactions, or restructuring programs, within the expected timeframes or at all;

Previous wording

•any changes in or difficulties with the Company’s manufacturing facilities, including with respect to inspections, remediation and restructuring activities, supply chain or inventory or the ability to meet anticipated demand;

Current wording

•any changes in or difficulties with the Company’s manufacturing facilities, including with respect to short- or long-term shutdowns, inspections, remediation and restructuring activities, supply chain continuity, inventory management, or the ability to meet anticipated demand;

Previous wording

•the potential impact of natural or man-made disasters, public health outbreaks, epidemics, pandemics or social disruption in regions where we or our partners or suppliers operate;

Current wording

•the potential impact of natural or man-made disasters, public health outbreaks, fires, accidents, weather, unrest or other emergencies in regions where we or our partners or suppliers operate;

Previous wording

•any regulatory, legal or other impediments to the Company’s ability to bring new products to market, including but not limited to “at-risk launches”;

Current wording

•any regulatory, legal or other impediments to the Company’s ability to bring new products to market;

Previous wording

•uncertainties and matters beyond the control of management, including but not limited to general political and economic conditions, potential for adverse impacts from future tariffs and trade restrictions, inflation rates and global exchange rates; and

Current wording

•uncertainties and matters beyond the control of management, including but not limited to general political and economic conditions, wars or other conflicts, potential for adverse impacts from future tariffs and trade restrictions, inflation rates and global exchange rates; and

Previous wording

For more detailed information on the risks and uncertainties associated with Viatris, see the risks described in Part I, Item 1A in the 2024 Form 10-K, Part II, Item 1A of this Form 10-Q, and our other filings with the SEC. You can access Viatris’ filings with the SEC through the SEC website at www.sec.gov or through our website, and Viatris strongly encourages you to do so. Viatris routinely posts information that may be important to investors on our website at investor.viatris.com, and we use this website address as a means of disclosing material information to the public in a broad, non-exclusionary manner for purposes of the SEC’s Regulation Fair Disclosure (Reg FD). The contents of our website are not incorporated by reference in this Form 10-Q and shall not be deemed “filed” under the Securities Exchange Act of 1934, as amended. Viatris undertakes no obligation to update any statements herein for revisions or changes after the filing date of this Form 10-Q other than as required by law.

Current wording

For more detailed information on the risks and uncertainties associated with Viatris, see the risks described in Part I, Item 1A in the 2025 Form 10-K, and our other filings with the SEC. You can access Viatris’ filings with the SEC through the SEC website at www.sec.gov or through our website, and Viatris strongly encourages you to do so. Viatris routinely posts information that may be important to investors on our website at investor.viatris.com, and we use this website address as a means of disclosing material information to the public in a broad, non-exclusionary manner for purposes of the SEC’s Regulation Fair Disclosure (Reg FD). The contents of our website are not incorporated by reference in this Form 10-Q and shall not be deemed “filed” under the Securities Exchange Act of 1934, as amended. Viatris undertakes no obligation to update any statements herein for revisions or changes after the filing date of this Form 10-Q other than as required by law.

Previous wording

Viatris’ executive management team is focused on ensuring that the Company is optimally structured and efficiently resourced to deliver sustainable value to patients, shareholders, customers and other key stakeholders. The Company operates in more than 165 countries and territories with more than 30,000 employees. The Company has 26 manufacturing and packaging sites worldwide, more than 1,400 approved molecules, and industry leading commercial, R&D, regulatory, manufacturing, legal and medical expertise. Viatris’ portfolio consists of generics (including complex products), globally recognized iconic brands, and an expanding portfolio of innovative medicines. Viatris is headquartered in the U.S., with global centers in Pittsburgh, Pennsylvania, Shanghai, China and Hyderabad, India.

Current wording

Viatris’ executive management team is focused on ensuring that the Company is optimally structured and efficiently resourced to deliver sustainable value to patients, shareholders, customers and other key stakeholders. The Company operates in more than 165 countries and territories with approximately 30,000 employees. The Company has 27 manufacturing, packaging, and distribution sites worldwide, approximately 1,300 approved molecules, and what we believe is industry leading commercial, R&D, regulatory, manufacturing, legal and medical expertise. Viatris’ portfolio consists of generics (including complex products), globally recognized iconic brands, and an expanding portfolio of innovative medicines. Viatris is headquartered in the U.S., with global centers in Pittsburgh, Pennsylvania, Shanghai, China and Hyderabad, India.

Previous wording

The process of obtaining regulatory approval to manufacture and market new branded and generic pharmaceutical products is rigorous, time consuming, costly, and inherently unpredictable. Complex generic products are often more difficult, costly and time-consuming to receive regulatory approval and bring to market compared with commodity generic pharmaceutical products. Any delay in regulatory approval could impact the commercial or financial success of a product. Regulatory approval, if and when obtained, may be limited in scope. Even if regulatory approvals for new products are obtained, the success of those products is dependent upon market acceptance.

Current wording

The process of obtaining regulatory approval to manufacture and market new branded and generic pharmaceutical products is rigorous, time consuming, costly, and inherently unpredictable. Complex generic products are often more difficult, costly and time-consuming to receive regulatory approval and bring to market compared with commodity generic pharmaceutical products. Any delay in regulatory approval could impact the commercial or financial success of a product.

Previous wording

For branded products, the majority of the product’s commercial value is usually realized during the period in which the product has market exclusivity. In the U.S. and some other countries, when market exclusivity expires and generic versions of a product are approved and marketed, there can often be very substantial and rapid declines in the branded product’s sales. For example, generic entry for Amitiza® 24 μg may occur in Japan in June 2026 depending on the outcome of regulatory reviews of generic applications and patent litigation.

Current wording

For branded products, the majority of the product’s commercial value is usually realized during the period in which the product has market exclusivity. In the U.S. and some other countries, when market exclusivity expires and generic versions of a product are approved and marketed, there can often be very substantial and rapid declines in the branded product’s sales. For example, generic entry for Amitiza® 24 μg may occur in Japan in December 2026 depending on the outcome of patent litigation.

Previous wording

Additionally, a number of markets in which we operate outside of the U.S. have implemented, or may implement, tender systems for generic pharmaceuticals in an effort to lower prices. Generally speaking, tender systems can have an unfavorable impact on sales and profitability. Under such tender systems, manufacturers submit bids that establish prices for generic pharmaceutical products. Upon winning the tender, the winning company will receive priority placement for a period of time. The tender system often results in companies underbidding one another by proposing low pricing in order to win the tender. Sales continue to be negatively affected by the impact of tender systems in certain countries.

Current wording

Additionally, a number of markets in which we operate outside of the U.S. have implemented, or may implement, tender systems for generic pharmaceuticals in an effort to lower prices. Generally speaking, tender systems can have an unfavorable impact on sales and profitability. Under such tender systems, manufacturers submit bids that establish prices for generic pharmaceutical products. Upon winning the tender, the winning company will receive priority placement for a period of time. The tender system often results in companies underbidding one another by proposing lower pricing in order to win the tender. Sales continue to be negatively affected by the impact of tender systems in certain countries.

Previous wording

Following an inspection by the FDA at our oral finished dose manufacturing facility in Indore, India in 2024, the FDA has issued a warning letter, and an import alert related to this facility. The import alert affects 11 actively distributed products that will no longer be accepted into the U.S. until the warning letter is lifted. It makes exceptions, subject to certain conditions, for four products based on shortage concerns. Following discussions with the FDA, the Company does not expect additional product exceptions to be granted by the FDA.

Current wording

Following an inspection by the FDA at our oral finished dose manufacturing facility in Indore, India in 2024, the FDA issued a warning letter and an import alert related to this facility. The import alert affects 11 products that will no longer be accepted into the U.S. until the warning letter is lifted.

Previous wording

Following the substance of FDA’s original inspection observations, the Company immediately implemented a comprehensive remediation plan at the site. During 2025, we have made substantial progress on our initial remediation activities at the facility, including but not limited to related personnel actions. Additionally, we have engaged independent third-party subject matter experts to support the remediation plan.

Current wording

Following the substance of FDA’s original inspection observations, the Company immediately implemented a comprehensive remediation plan at the site. During 2025, we made substantial progress on our remediation activities at the facility, including but not limited to related personnel actions. Additionally, we have engaged independent third-party subject matter experts to support the remediation plan.

Previous wording

While product continues to be shipped from the Indore facility to markets outside the U.S., as expected, we have also experienced a negative impact in other markets during 2025, including the ARV business in Emerging Markets and select generic products in Europe.

Current wording

While product continues to be shipped from the Indore facility to markets outside the U.S., as expected, we have also experienced a negative impact in other markets, including the ARV business in Emerging Markets and select generic products in Europe.

Previous wording

We have been in regular communication with FDA during this process and will continue to work to ensure that the FDA is satisfied with the steps we have taken to resolve all the points raised. Our responses to the warning letter and import alert were submitted within the required time periods. The facility will be subject to a reinspection by the FDA. The timing of the reinspection will be determined by the FDA; however, we anticipate that the facility will be ready for reinspection in 2026.

Current wording

We have been in regular communication with the FDA during this process and will continue to work to ensure that the FDA is satisfied with the steps we have taken to resolve all the points raised. Our responses to the warning letter and import alert were submitted within the required time periods. The facility will be subject to a reinspection by the FDA. The timing of the reinspection will be determined by the FDA; however, we anticipate that the facility will be ready for reinspection in 2026.

Previous wording

The table below is a summary of the Company’s financial results for the three and nine months ended September 30, 2025 compared to the prior year period:

Current wording

The table below is a summary of the Company’s financial results for the three months ended March 31, 2026 compared to the prior year period:

Previous wording

A detailed discussion of the Company’s financial results can be found below in the section titled “Results of Operations.” As part of this discussion, we also report sales performance using the non-GAAP financial measures of “constant currency” net sales and total revenues. These measures provide information on the change in net sales and total revenues assuming that foreign currency exchange rates had not changed between the prior and current period. The comparisons presented at constant currency rates reflect comparative local currency sales at the prior year’s foreign exchange rates. We routinely evaluate our net sales and total revenues performance at constant currency so that sales results can be viewed without the impact of foreign currency exchange rates, thereby facilitating a period-to-period comparison of our operational activities, and believe that this presentation also provides useful information to investors for the same reason.

Current wording

A detailed discussion of the Company’s financial results can be found below in the section titled “Results of Operations.” As part of this discussion, we also report sales performance using the non-GAAP financial measures of “constant currency” net sales and total revenues. These measures provide information on the change in net sales and total revenues assuming that foreign currency exchange rates had not changed between the prior and current period. The comparisons presented at constant currency rates reflect comparative local currency sales at the prior year’s foreign exchange rates. We routinely evaluate our net sales and total revenues performance at constant currency so that these results can be viewed without the impact of foreign currency exchange rates, thereby facilitating a period-to-period comparison of our operational activities, and believe that this presentation also provides useful information to investors for the same reason.

Previous wording

(4)For the three months ended September 30, 2025, other revenues in Developed Markets, JANZ, and Emerging Markets were approximately $10.0 million, $1.0 million, and $1.4 million, respectively.

Current wording

(3)For the three months ended March 31, 2026, other revenues in Developed Markets, JANZ, and Emerging Markets were approximately $5.2 million, $0.1 million, and $2.0 million, respectively.

Previous wording

(5)Amounts exclude intersegment revenue which eliminates on a consolidated basis.

Current wording

(4)Amounts exclude intersegment revenue which eliminates on a consolidated basis.

Previous wording

For the nine months ended September 30, 2025, Viatris reported total revenues of $10.60 billion, compared to $11.21 billion for the comparable prior year period, representing a decrease of $614.9 million, or 5%. Total revenues include both net sales and other revenues from third parties. Net sales for the nine months ended September 30, 2025 were $10.56 billion, compared to $11.18 billion for the comparable prior year period, representing a decrease of $617.7 million, or 6%. Other revenues for the nine months ended September 30, 2025 were $36.6 million, compared to $33.8 million for the comparable prior year period.

Current wording

For the three months ended March 31, 2026, Viatris reported total revenues of $3.52 billion, compared to $3.25 billion for the comparable prior year period, representing an increase of $262.7 million, or 8%. Total revenues include both net sales and other revenues from third parties. Net sales for the three months ended March 31, 2026 were $3.51 billion, compared to $3.24 billion for the comparable prior year period, representing an increase of $266.5 million, or 8%. Other revenues for the three months ended March 31, 2026 were $7.3 million, compared to $11.1 million for the comparable prior year period.

Previous wording

Net sales decreased by approximately $18.6 million, or less than 1%, due to the inclusion of net sales in the prior year period related to divestitures that closed during 2024. The favorable impact of foreign currency translation was approximately $76.4 million, or 2%, primarily reflecting changes in the U.S. Dollar as compared to the currencies of subsidiaries in the EU. On a constant currency basis, net sales from the remaining business decreased by approximately $48.3 million, or 1%, for the three months ended September 30, 2025 compared to the prior year period. The decrease was the result of net base business erosion of approximately $147.8 million, of which approximately $100 million related to the Indore Impact. This decrease was partially offset by new product sales, primarily in Developed Markets, of approximately $99.5 million. New product sales include new products launched in 2025 and the carryover impact of new products, including business development, launched within the last twelve months.

Current wording

The favorable impact of foreign currency translation was approximately $161.8 million, or 5%, primarily reflecting changes in the U.S. Dollar as compared to the currencies of subsidiaries in the EU and China. On a constant currency basis, net sales increased by approximately $104.7 million, or 3%, for the three months ended March 31, 2026 compared to the prior year period. The increase was the result of new product sales, primarily in Developed Markets, of approximately $70.7 million, and net base business growth, primarily in Greater China, of approximately $34.0 million. New product sales include new products launched in 2026 and the carryover impact of new products, including business development, launched within the last twelve months.

Previous wording

From time to time, a limited number of our products may represent a significant portion of our net sales, gross profit and net earnings. Generally, this is due to the timing of new product introductions, seasonality, and the amount, if any, of additional competition in the market. Our top ten products in terms of net sales, in the aggregate, represented approximately 38% and 36% for the three months ended September 30, 2025 and 2024, respectively.

Current wording

From time to time, a limited number of our products may represent a significant portion of our net sales, gross profit and net earnings. Generally, this is due to the timing of new product introductions, seasonality, and the amount, if any, of additional competition in the market. Our top ten products in terms of net sales, in the aggregate, represented approximately 40% and 38% for the three months ended March 31, 2026 and 2025, respectively.

Previous wording

Net sales from Developed Markets decreased by $43.1 million, or 2%, for the three months ended September 30, 2025 when compared to the prior year period. Net sales decreased by approximately $11.1 million, or less than 1%, due to the inclusion of net sales in the prior year period related to divestitures that closed during 2024. The favorable impact of foreign currency translation was approximately $76.0 million, or 3%. Constant currency net sales from the remaining business decreased by approximately $108.0 million, or 5%, when compared to the prior year period, driven primarily by lower net sales of certain existing products, including lenalidomide and everolimus in the U.S., as a result of the Indore Impact of approximately $100 million, partially offset by new product sales. Net sales within North America totaled approximately $868.4 million and net sales within Europe totaled approximately $1.39 billion.

Current wording

Net sales from Developed Markets increased by $129.1 million, or 7%, for the three months ended March 31, 2026 when compared to the prior year period. The favorable impact of foreign currency translation was approximately $117.7 million, or 6%. Constant currency net sales increased by approximately $11.4 million, or 1%, when compared to the prior year period driven by new product sales. This was partially offset by lower net sales of certain existing products, primarily as a result of supply constraints and additional competition. Net sales within North America totaled approximately $828.1 million and net sales within Europe totaled approximately $1.19 billion.

Previous wording

Net sales from Greater China increased by $53.4 million, or 10%, for the three months ended September 30, 2025 when compared to the prior year period. The favorable impact of foreign currency translation was approximately $2.3 million, or less than 1%. Constant currency net sales increased by approximately $51.1 million, or 9%, when compared to the prior year period, primarily driven by strong growth across multiple channels, including e-commerce, retail, and private hospitals, as well as benefits of timing of customer purchasing patterns. Divestitures did not have a significant impact on the net sales in either period and the Indore Impact for the three months ended September 30, 2025 was not significant.

Current wording

Net sales from Greater China increased by $124.6 million, or 22%, for the three months ended March 31, 2026 when compared to the prior year period. The favorable impact of foreign currency translation was approximately $25.6 million, or 5%. Constant currency net sales increased by approximately $99.0 million, or 18%, when compared to the prior year period, primarily the result of strong growth across multiple channels, including e-commerce, retail, and private hospitals, driven by increased marketing and selling efforts.

Previous wording

Net sales from JANZ decreased by $38.0 million, or 11%, for the three months ended September 30, 2025 when compared to the prior year period. Net sales decreased by approximately $3.2 million, or 1%, due to the inclusion of net sales in the prior year period related to divestitures that closed during 2024. The unfavorable impact of foreign currency translation was approximately $4.3 million, or 1%. Constant currency net sales from the remaining business decreased by approximately $30.5 million, or 9%, when compared to the prior year period, driven primarily by lower net sales of existing products in Japan and Australia due to government price reductions and additional competition. The Indore Impact for the three months ended September 30, 2025 was not significant.

Current wording

Net sales from JANZ decreased by $2.7 million, or 1%, for the three months ended March 31, 2026 when compared to the prior year period. The favorable impact of foreign currency translation was approximately $3.9 million, or 1%. Constant currency net sales decreased by approximately $6.6 million, or 2%, when compared to the prior year period, driven primarily by lower net sales of existing products in Japan and Australia due to government price reductions and additional competition.

Previous wording

Cost of sales increased from $2.29 billion for the three months ended September 30, 2024 to $2.39 billion for the three months ended September 30, 2025. The increase in cost of sales was largely driven by product mix as a result of the Indore Impact.

Current wording

Cost of sales increased from $2.09 billion for the three months ended March 31, 2025 to $2.36 billion for the three months ended March 31, 2026. The increase in cost of sales was largely driven by the increase in net sales, higher restructuring costs, and higher costs associated with other special items, which include certain costs for plants slated for sale or closure or undergoing remediation activities, including $71.9 million related to the write off inventory and fixed assets damaged in the fire at the Nashik manufacturing facility and incremental manufacturing variances.

Previous wording

Gross profit for the three months ended September 30, 2025 was $1.37 billion and gross margins were 36%. For the three months ended September 30, 2024, gross profit was $1.46 billion and gross margins were 39%. The changes in gross profit and gross margins are primarily related to the Indore Impact. Adjusted gross margins were approximately 56% for the three months ended September 30, 2025, compared to approximately 58% for the three months ended September 30, 2024.

Current wording

Gross profit for the three months ended March 31, 2026 was $1.16 billion and gross margins were 33%. For the three months ended March 31, 2025, gross profit was $1.16 billion and gross margins were 36%. The changes in gross profit and gross margins are primarily related to the increase in cost of sales. Adjusted gross margins were approximately 56% for the three months ended March 31, 2026, compared to approximately 56% for the three months ended March 31, 2025.

Previous wording

R&D expense for the three months ended September 30, 2025 was $250.4 million, compared to $198.4 million for the comparable prior year period, an increase of $52.0 million. This increase was primarily the result of higher expenses for the selatogrel and cenerimod development programs.

Current wording

R&D expense for the three months ended March 31, 2026 was $248.6 million, compared to $222.0 million for the comparable prior year period, an increase of $26.6 million. This increase was primarily the result of higher expenses for the selatogrel and cenerimod development programs.

Previous wording

Acquired IPR&D expense for the nine months ended September 30, 2025 was $10.0 million, compared to $(1.7) million for the comparable prior year period, an increase of $11.7 million. The current period expense is related to an upfront licensing payment for rights to cenerimod in Japan, South Korea and certain countries in the Asia-Pacific region.

Current wording

Acquired IPR&D expense for the three months ended March 31, 2026 was $6.0 million, compared to $10.0 million for the comparable prior year period, a decrease of $4.0 million. The current period expense was related to an upfront payment for a licensing deal, and the prior period expense was related to an upfront licensing payment for rights to cenerimod in Japan, South Korea and certain countries in the Asia-Pacific region.

Previous wording

SG&A expense for the current quarter was $886.6 million, compared to $1.00 billion for the comparable prior year period, a decrease of $116.8 million. The decrease was primarily due to lower acquisition and divestiture-related costs of approximately $67.3 million and lower restructuring costs of approximately $18.1 million.

Current wording

SG&A expense for the three months ended March 31, 2026 was $928.8 million, compared to $948.1 million for the comparable prior year period, a decrease of $19.3 million. The decrease was primarily due to lower restructuring costs of approximately $30.3 million.

Previous wording

(a)For the nine months ended September 30, 2025, includes a goodwill impairment charge of $2.94 billion as a result of the interim goodwill impairment test performed as of March 31, 2025.

Current wording

During the prior year period, the Company recorded a goodwill impairment charge of $2.94 billion in conjunction with its interim goodwill impairment test performed as of March 31, 2025.

Previous wording

The following table includes the losses recognized in litigation settlements and other contingencies, net during the three months ended September 30, 2025 and 2024, respectively:

Current wording

The following table includes the losses/(gains) recognized in litigation settlements and other contingencies, net during the three months ended March 31, 2026 and 2025, respectively:

Previous wording

Refer to Note 4 Acquisitions and Other Transactions and Note 11 Financial Instruments and Risk Management included in Part I, Item 1 of this Form 10-Q for more information with respect to the contingent consideration adjustment.

Current wording

Refer to Note 10 Financial Instruments and Risk Management and Note 17 Litigation included in Part I, Item 1 of this Form 10-Q for more information with respect to the contingent consideration adjustment and litigation settlements, net, respectively.

Previous wording

Other expense (income), net includes gains and losses from divestitures of businesses, changes in the fair value of equity securities, extinguishment of debt, foreign exchange, expense (income) related to post-employment benefit plans, TSA income, and interest and dividend income. Other expense, net for the three months ended September 30, 2025 totaled $67.1 million, compared to $10.2 million for the three months ended September 30, 2024.

Current wording

Other expense, net includes gains and losses from divestitures of businesses, changes in the fair value of equity securities, foreign exchange, expense (income) related to post-employment benefit plans, TSA income, and interest and dividend income. Other expense, net for the three months ended March 31, 2026 totaled $47.5 million, compared to $99.3 million for the three months ended March 31, 2025, a decrease of $51.8 million.

Previous wording

The decrease was primarily driven by a loss of $499.8 million recorded in the current year period as a result of changes in the fair value of the CCPS in Biocon Biologics, compared to a net gain in the prior year period of $334.5 million related to our non-marketable equity investments, including the CCPS in Biocon Biologics, and lower interest income of $48.7 million. This was partially offset by a decrease in loss on divestitures of $216.6 million compared to the prior year period. Refer to Note 11 Financial Instruments and Risk Management included in Part I, Item 1 of this Form 10-Q for more information with respect to the change in the fair value of the CCPS in Biocon Biologics.

Current wording

The decrease was primarily driven by a loss in the prior year period of $115.8 million as a result of changes in the fair value of the CCPS in Biocon Biologics, and a decrease in the loss on divestitures of $23.0 million. This was partially offset by a loss of $64.9 million recorded in the current year period as a result of changes in the fair value of equity shares of Biocon. Refer to Note 10 Financial Instruments and Risk Management included in Part I, Item 1 of this Form 10-Q for more information with respect to the Biocon equity shares.

Previous wording

For the nine months ended September 30, 2025, the Company recognized an income tax benefit of $147.2 million, compared to an income tax provision of $21.0 million for the comparable prior year period, a change of $168.2 million. The benefit in the current year period is primarily driven by the loss before income taxes, partially offset by the negative impact of the goodwill impairment charge, for which minimal tax benefit was realized, and a $17.7 million accrual related to the resolution of the previously disclosed Swedish tax matter. The current year and prior year provisions were also impacted by the levels of income and the changing mix at which it is earned in jurisdictions with differing tax rates.

Current wording

For the three months ended March 31, 2026, the Company recognized an income tax benefit of $423.7 million, compared to an income tax benefit of $55.0 million for the comparable prior year period, a change of $368.7 million. The benefit in the current year period is primarily driven by the loss before income taxes and the tax benefit of certain internal restructurings undertaken, partially offset by losses in jurisdictions for which minimal benefit can be recognized. The benefit in the prior year period is primarily driven by the loss before income taxes, partially offset by the negative impact of the goodwill impairment charge, for which minimal tax benefit was realized, and a $17.7 million accrual related to the resolution of the previously disclosed Swedish tax matter. The current quarter and prior quarter provisions were impacted by the levels of income and the changing mix at which it is earned in jurisdictions with differing tax rates.

Previous wording

•Certain acquisition and divestiture costs, including costs relating to integration and planning, advisory and legal fees, certain financing related costs, certain reimbursements related to the Company’s obligation to reimburse Pfizer for certain financing and transaction related costs under the Business Combination Agreement and Separation and Distribution Agreement, certain other TSA related set-up and exit costs, and other business transformation and/or optimization initiatives, which are not part of a formal restructuring program, including employee separation and post-employment costs;

Current wording

•Certain acquisition and divestiture costs, including costs relating to integration and planning, contractual obligations, including under supply agreements, advisory and legal fees, certain financing related costs, certain reimbursements related to the Company’s obligation to reimburse Pfizer for certain financing and transaction related costs under the Business Combination Agreement and Separation and Distribution Agreement, certain other TSA related set-up and exit costs, and other business transformation and/or optimization initiatives, which are not part of a formal restructuring program, including employee separation and post-employment costs;

Previous wording

•Other costs, incurred from time to time, related to certain special events or activities that lead to gains or losses, including, but not limited to, incremental manufacturing variances, certain remediation activities, asset write-downs, including other-than-temporary impairments of investments in equity or debt instruments, or liability adjustments;

Current wording

•Other costs, incurred from time to time, related to certain special events or activities that lead to gains or losses, including, but not limited to, incremental manufacturing variances, contractual termination costs, certain remediation activities, asset write-downs, including other-than-temporary impairments of investments in equity or debt instruments, or liability adjustments;