Bausch & Lomb Corp

Previous wording

Our accompanying unaudited interim Condensed Consolidated Financial Statements as of March 31, 2024 and for the three months ended March 31, 2024 and 2023 have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) for interim financial statements, and should be read in conjunction with our Consolidated Financial Statements for the year ended December 31, 2023, which were included in our Annual Report on Form 10-K filed with the SEC and the Canadian Securities Administrators (the “CSA”) on February 21, 2024 (the “Annual Report”). In our opinion, the unaudited interim Condensed Consolidated Financial Statements reflect all adjustments, consisting of normal and recurring adjustments, necessary for a fair statement of the financial condition, results of operations and cash flows for the periods indicated. Additional Company information is available on SEDAR+ at www.sedarplus.com and on the SEC website at www.sec.gov. All currency amounts are expressed in U.S. dollars, unless otherwise noted. Certain defined terms used herein have the meaning ascribed to them in the accompanying unaudited interim Condensed Consolidated Financial Statements as of March 31, 2024 and for the three months ended March 31, 2024 and 2023.

Current wording

Our accompanying unaudited interim Condensed Consolidated Financial Statements as of June 30, 2024 and for the three and six months ended June 30, 2024 and 2023 have been prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) and the rules and regulations of the United States Securities and Exchange Commission (the “SEC”) for interim financial statements, and should be read in conjunction with our Consolidated Financial Statements for the year ended December 31, 2023, which were included in our Annual Report on Form 10-K filed with the SEC and the Canadian Securities Administrators (the “CSA”) on February 21, 2024 (the “Annual Report”). In our opinion, the unaudited interim Condensed Consolidated Financial Statements reflect all adjustments, consisting of normal and recurring adjustments, necessary for a fair statement of the financial condition, results of operations and cash flows for the periods indicated. Additional Company information is available on SEDAR+ at www.sedarplus.com and on the SEC website at www.sec.gov. All currency amounts are expressed in U.S. dollars, unless otherwise noted. Certain defined terms used herein have the meaning ascribed to them in the accompanying unaudited interim Condensed Consolidated Financial Statements as of June 30, 2024 and for the three and six months ended June 30, 2024 and 2023.

Previous wording

Bausch + Lomb is a subsidiary of Bausch Health Companies Inc. (“BHC”), with BHC holding, directly or indirectly, approximately 88.3% of the issued and outstanding common shares of Bausch + Lomb, as of April 24, 2024. On August 6, 2020, BHC, announced its plan to separate our eye health business into an independent publicly traded entity, separate from the remainder of BHC (the “Separation”). This resulted in the initial public offering of Bausch + Lomb (the “B+L IPO”), and our common shares began trading on the New York Stock Exchange and the Toronto Stock Exchange, in each case under the ticker symbol “BLCO”, on May 6, 2022. The completion of the full separation of Bausch + Lomb from the remainder of BHC (the “Separation”), which includes the transfer of all or a portion of BHC’s remaining direct or indirect equity interest in Bausch + Lomb to its shareholders (the “Distribution”), is subject to the achievement of targeted debt leverage ratios and the receipt of applicable shareholder and other necessary approvals and other factors and is subject to various risk factors relating to the Separation. Bausch + Lomb understands that BHC continues to believe that completing the Separation makes strategic sense and that BHC continues to evaluate all relevant factors and considerations related to completing the Separation, including those factors described in BHC’s public filings. For additional information on the risks related to the Separation, see Item 1A. “Risk Factors — Risks Relating to the Separation” of our Annual Report.

Current wording

Bausch + Lomb is a subsidiary of Bausch Health Companies Inc. (“BHC”), with BHC holding, directly or indirectly, approximately 88.2% of the issued and outstanding common shares of Bausch + Lomb, as of July 24, 2024. On August 6, 2020, BHC, announced its plan to separate our eye health business into an independent publicly traded entity, separate from the remainder of BHC (the “Separation”). This resulted in the initial public offering of Bausch + Lomb (the “B+L IPO”), and our common shares began trading on the New York Stock Exchange and the Toronto Stock Exchange, in each case under the ticker symbol “BLCO”, on May 6, 2022. The completion of the full separation of Bausch + Lomb from the remainder of BHC (the “Separation”), which includes the transfer of all or a portion of BHC’s remaining direct or indirect equity interest in Bausch + Lomb to its shareholders (the “Distribution”), is subject to the achievement of targeted debt leverage ratios and the receipt of applicable shareholder and other necessary approvals and other factors and is subject to various risk factors relating to the Separation. Bausch + Lomb understands that BHC continues to believe that completing the Separation makes strategic sense and that BHC continues to evaluate all relevant factors and considerations related to completing the Separation, including those factors described in BHC’s public filings. For additional information on the risks related to the Separation, see Item 1A. “Risk Factors — Risks Relating to the Separation” of our Annual Report.

Previous wording

The Pharmaceuticals segment—consists of a broad line of proprietary and generic pharmaceutical products for post-operative treatments and treatments for a number of eye conditions, such as glaucoma, eye inflammation, ocular hypertension, dry eyes and retinal diseases. Key proprietary pharmaceutical brands are MIEBO®, Vyzulta®, Lotemax®, Prolensa® and Minims®. In addition, during September 2023, the Company acquired XIIDRA® (as further discussed below), which complements and is expected to grow the Company's existing dry eye franchise.

Current wording

The Pharmaceuticals segment—consists of a broad line of proprietary and generic pharmaceutical products for post-operative treatments and treatments for a number of eye conditions, such as glaucoma, eye inflammation, ocular hypertension, dry eyes and retinal diseases. Key proprietary pharmaceutical brands are MIEBO®, Vyzulta®, Lotemax®, Prolensa® and Minims®. In addition, during September 2023, the Company acquired XIIDRA® (as further discussed below), which complements and grows the Company's existing dry eye franchise.

Previous wording

•SiHy Daily - A silicone hydrogel daily disposable contact lens designed to provide outstanding comfort and clear vision throughout the day. To date SiHy Daily has been launched in approximately 50 countries, under the brand names INFUSE®, BAUSCH + LOMB ULTRA® ONE DAY and AQUALOX® ONE DAY. We continue to plan to launch our SiHy Daily lenses into additional countries throughout 2024. In addition, we launched our first silicone hydrogel daily disposable multifocal contact lens in May 2023, and plan to launch a toric lens in 2024.

Current wording

•SiHy Daily - A silicone hydrogel daily disposable contact lens designed to provide outstanding comfort and clear vision throughout the day. To date SiHy Daily has been launched in over 50 countries, under the brand names INFUSE®, BAUSCH + LOMB ULTRA® ONE DAY and AQUALOX® ONE DAY. We continue to plan to launch our SiHy Daily lenses into additional countries throughout 2024. In addition, we launched our first silicone hydrogel daily disposable multifocal contact lens in May 2023, and launched a toric lens in the U.S. in June 2024.

Previous wording

We submitted the filing for Canadian approval of this product during the first quarter of 2023 and expect approval during 2024. MIEBO® is the first and only FDA-approved treatment for DED that directly targets tear evaporation and we believe the addition of MIEBO® will help build upon our strong portfolio of integrated eye health products.

Current wording

The Canadian approval of this product, submitted during the first quarter of 2023, is ongoing. MIEBO® is the first and only FDA-approved treatment for DED that directly targets tear evaporation and we believe the addition of MIEBO® will help build upon our strong portfolio of integrated eye health products.

Previous wording

•enVista® – We are expanding our portfolio of premium IOLs built on the enVista® platform with enVista Aspire TM (Monofocal Plus), enVista Envy TM Trifocal and enVista Beyond TM (extended depth of focus (“EDOF”)) optical designs with two options: non-Toric and Toric for astigmatism patients. enVista Aspire TM monofocal and toric IOLs with Intermediate Optimized optics launched in the U.S. during October 2023 and we anticipate launching in Europe and Canada in 2025. In addition, we anticipate launching enVista Envy TM in the U.S. and Canada in 2024, and in Europe in 2025, and anticipate launching enVista Beyond TM in the U.S. in 2026.

Current wording

•enVista® – We are expanding our portfolio of premium IOLs built on the enVista® platform with enVista Aspire TM (Monofocal Plus), enVista Envy TM Trifocal and enVista Beyond TM (extended depth of focus (“EDOF”)) optical designs with two options: non-Toric and Toric for astigmatism patients. enVista Aspire TM monofocal and toric IOLs with Intermediate Optimized optics launched in the U.S. during October 2023 and we anticipate launching in Europe and Canada in 2025. enVista Envy TMlaunched in Canada in June 2024 and we anticipate launching enVista Envy TM in the U.S. during the fourth quarter of 2024 and in Europe in 2025. We anticipate launching enVista Beyond TM in the U.S. in 2026.

Previous wording

•Acquisition of XIIDRA® – In September 2023, the Company acquired XIIDRA®, the first and only non-steroid eye drop specifically approved to treat the signs and symptoms of dry eye disease focusing on inflammation associated with dry eye, and certain other ophthalmology assets from Novartis Pharma AG and Novartis Finance Corporation (together with Novartis Pharma AG, “Novartis”) (the “XIIDRA Acquisition”). We believe the XIIDRA Acquisition complements and will grow our existing dry eye franchise.

Current wording

•Acquisition of XIIDRA® – In September 2023, the Company acquired XIIDRA®, the first and only non-steroid eye drop specifically approved to treat the signs and symptoms of dry eye disease focusing on inflammation associated with dry eye, and certain other ophthalmology assets from Novartis Pharma AG and Novartis Finance Corporation (together with Novartis Pharma AG, “Novartis”) (the “XIIDRA Acquisition”). The XIIDRA Acquisition complements and grows our existing dry eye franchise.

Previous wording

•Acquisition of Blink®Product Line – In July 2023, we acquired the Blink® OTC product line of eye and contact lens drops from Johnson & Johnson Vision, which consists of Blink® Tears Lubricating Eye Drops, Blink® Tears Preservative Free Lubricating Eye Drops, Blink GelTears® Lubricating Eye Drops, Blink® Triple Care Lubricating Eye Drops, Blink Contacts® Lubricating Eye Drops and Blink-N-Clean® Lens Drops (collectively, the “Blink® Product Line”). We believe this acquisition will enable us to continue to grow our global OTC business.

Current wording

•Acquisition of Blink®Product Line – In July 2023, we acquired the Blink® OTC product line of eye and contact lens drops from Johnson & Johnson Vision, which consists of Blink® Tears Lubricating Eye Drops, Blink® Tears Preservative Free Lubricating Eye Drops, Blink GelTears® Lubricating Eye Drops, Blink® Triple Care Lubricating Eye Drops, Blink Contacts® Lubricating Eye Drops and Blink-N-Clean® Lens Drops (collectively, the “Blink® Product Line”). This acquisition has enabled us to continue to grow our global OTC business.

Previous wording

In February 2022, Russia invaded Ukraine. As military activity and sanctions against Russia, Belarus and specific areas of Ukraine have continued, the war has increasingly affected economic and global financial markets and exacerbated ongoing economic challenges, including issues such as high levels of inflation and global supply-chain disruption.

Current wording

In February 2022, Russia invaded Ukraine. As military activity and sanctions against Russia, Belarus and specific areas of Ukraine have continued, the war has continued to affect economic and global financial markets and placed further pressure on ongoing economic challenges, including issues such as inflation and global supply-chain disruption.

Previous wording

In May 2023, the Biden administration announced a round of U.S. sanctions and export controls against Russia and Belarus in response to the ongoing war. These sanctions temporarily impacted our ability to distribute our U.S. manufactured contact lenses and our U.S. surgical products to Russia and Belarus. However, in response to these sanctions, we applied for licenses with the U.S. Department of Commerce’s Bureau of Industry and Security for both Russia and Belarus and we have now received all licenses necessary to allow us to resume the sale of the applicable currently sanctioned products in each of these countries. The recent rounds of sanctions imposed by the U.S. Department of the Treasury’s Office of Foreign Assets

Current wording

The Biden administration has imposed U.S. sanctions and export controls against Russia and Belarus in response to the ongoing war. These sanctions temporarily impacted our ability to distribute our U.S. manufactured contact lenses and our U.S. surgical products to Russia and Belarus. However, in response to these sanctions, we applied for licenses with the U.S. Department of Commerce’s Bureau of Industry and Security for both Russia and Belarus and we have all licenses necessary to allow us to sell the applicable currently sanctioned products in each of these countries.

Previous wording

In addition, the EU has also imposed several rounds of sanctions against Russia, including (i) in June 2023, which included, among other key elements, new targeted sanctions against individuals and entities, an expansion of the restrictions on the sale, export and transit of certain goods and technology and additional anti-circumvention measures, and (ii) in February 2024, which imposed asset freezes on additional individuals and entities, expanded sectoral sanctions and further limited Russia’s access to military technology via entities based outside of the EU. In addition, in December 2023, the EU announced an additional package of sanctions (the 12 th package), the focus of which is to impose additional import and export bans on Russia, combat sanctions circumvention and close loopholes. In particular, the 12 th package removes the exemption to provide certain “controlled” business services to Russian affiliates, effective June 2024. The categories of “controlled” services are broad and capture a number of types of business services. We continue to assess the impact of these new EU sanctions on our operations in and services provided through the EU. If it is determined that the Company provides such “controlled” business services from the EU, we may be required to obtain further licenses if we want to continue to provide such services from the EU.

Current wording

In addition, the EU has also imposed several rounds of sanctions against Russia. We continue to assess the impact of these EU sanctions on our operations in, and services provided through, the EU. We have obtained licenses, where required, for products provided to Russia from the EU, and we have identified certain “controlled” business services for which we are in the process of pursuing licenses from the relevant EU member states.

Previous wording

To date, the challenges associated with the Russia-Ukraine War and related sanctions from the U.S., EU and elsewhere have not yet had a material impact on our operations; although, as noted above, we continue to review the 12 th package of EU sanctions and are still assessing their impact on our operations.

Current wording

To date, the challenges associated with the Russia-Ukraine War and related sanctions from the U.S., EU and elsewhere have not yet had a material impact on our operations; although, as noted above, we continue to review recent EU sanctions and are still assessing their impact on our operations.

Previous wording

Our revenues attributable to Russia, Ukraine and Belarus, in the aggregate, were approximately 3% of our total revenues for, both, the three months ended March 31, 2024 and year ended December 31, 2023. In addition, we do not have any research or manufacturing facilities in Russia, Ukraine or Belarus. While we have been monitoring this conflict, and will continue to do so as this conflict continues to evolve, we are unable to predict the impact of this conflict on the Company’s business.

Current wording

Our revenues attributable to Russia, Ukraine and Belarus, in the aggregate, were approximately 3% of our total revenues for, both, the six months ended June 30, 2024 and year ended December 31, 2023. In addition, we do not have any research or manufacturing facilities in Russia, Ukraine or Belarus. While we have been monitoring this conflict, and will continue to do so as this conflict continues to evolve, we are unable to predict the impact of this conflict on the Company’s business.

Previous wording

The conflict between Israel and Hamas began during October 2023 and continues to impact the region. Our revenues attributable to Israel and Iran for the three months ended March 31, 2024 and year ended December 31, 2023 were less than 1% of our total revenues in each period. Sales in Iran are covered by a general OFAC license. While we have been monitoring this conflict, and will continue to do so as this conflict continues to evolve, we are unable to predict the impact of this conflict on the Company’s business.

Current wording

The conflict between Israel and Hamas began during October 2023 and continues to impact the region. Our revenues attributable to Israel and Iran for the six months ended June 30, 2024 and year ended December 31, 2023 were less than 1% of our total revenues in each period. Sales in Iran are covered by a general OFAC license. While we have been monitoring this conflict, and will continue to do so as this conflict continues to evolve, we are unable to predict the impact of this conflict on the Company’s business.

Previous wording

On October 8, 2021, the Organisation for Economic Co-operation and Development (“OECD”)/G20 inclusive framework on Base Erosion and Profit Shifting (the “Inclusive Framework”) published a statement updating and finalizing the key components of a two-pillar plan on global tax reform originally agreed on July 1, 2021, and a timetable for implementation by 2023. The timetable for implementation has since been extended to 2024 or, with respect to certain components of the plan, to 2025. The Inclusive Framework plan has now been agreed to by 145 OECD members, including several countries which did not agree to the initial plan. Under pillar one, a portion of the residual profits of multinational businesses with global turnover above €20 billion and a profit margin above 10% will be allocated to market countries where such allocated profits would be taxed. Under pillar two, the Inclusive Framework has agreed on a global minimum corporate tax rate of 15% for companies with revenue above €750 million, calculated on a country-by-country basis. On October 30, 2021, the G20 formally endorsed the new global minimum corporate tax rate rules. The Inclusive Framework agreement must now be implemented by the OECD Members who have agreed to the plan, effective in 2024. Many members of the Inclusive

Current wording

On October 8, 2021, the Organisation for Economic Co-operation and Development (“OECD”)/G20 inclusive framework on Base Erosion and Profit Shifting (the “Inclusive Framework”) published a statement updating and finalizing the key components of a two-pillar plan on global tax reform originally agreed on July 1, 2021, and a timetable for implementation by 2023. The timetable for implementation has since been extended to 2024 or, with respect to certain components of the plan, to 2025. The Inclusive Framework plan has now been agreed to by 147 OECD members, including several countries which did not agree to the initial plan. Under pillar one, a portion of the residual profits of multinational businesses with global turnover above €20 billion and a profit margin above 10% will be allocated to market countries where such allocated profits would be taxed. Under pillar two, the Inclusive Framework has agreed on a global minimum corporate tax rate of 15% for companies with revenue above €750 million, calculated on a country-by-country basis. On October 30, 2021, the G20 formally endorsed the new global minimum corporate tax rate rules. The Inclusive Framework agreement must now be implemented by the OECD Members who have agreed to the plan, effective in 2024. Many members of the Inclusive

Previous wording

Framework have either introduced or announced their intention to introduce certain components of the global minimum tax in line with the model rules for fiscal year beginning on or after December 31, 2023. For example, on December 15, 2022, the European Union member states unanimously adopted the directive to implement pillar two rules. According to the directive, the member states were expected to enact pillar two rules into domestic law in 2023, with certain elements becoming effective for fiscal years beginning on or after December 31, 2023. On August 4, 2023, Canada released draft legislation to enact certain components of the pillar two proposals into Canadian law as the Global Minimum Tax Act (“GMTA”). The GMTA is generally aligned with the model rules proposed by the OECD and is expected to become effective for fiscal years beginning on or after December 31, 2023. The United States did not announce plans to enact the tax measures under the two-pillar plan. On February 1, 2023, the U.S. Financial Accounting Standards Board indicated that they believe the minimum tax imposed under pillar two is an alternative minimum tax, and, accordingly, deferred tax assets and liabilities associated with the minimum tax would not be recognized or adjusted for the estimated future effects of the minimum tax but would be recognized in the period incurred. The OECD has published model rules and other guidance with respect to pillar two, which are generally consistent with the agreement reached by the Inclusive Framework in October 2021. On February 1, 2023, the Inclusive Framework released a package of technical and administrative guidance on the implementation of pillar two, including the scope of companies that will be subject to the Global Anti-Base Erosion Rules, transition rules, and guidance on domestic minimum taxes that countries may choose to adopt, among other topics. On December 18, 2023 the OECD announced plans to release additional guidance on model rules and to start the peer review process in 2024. While many jurisdictions in which the Company operates have adopted the global minimum tax provision of the OECD pillar two effective for tax years beginning in January 2024, the Company has concluded that there is minimal impact to its 2024 tax rate due to the accounting for the tax effects of intercompany transactions. The Company expects that there is risk that the impact of the global minimum tax may eventually result in an increase to its overall effective tax rate.

Current wording

Framework have either introduced or announced their intention to introduce certain components of the global minimum tax in line with the model rules for fiscal years beginning on or after December 31, 2023. For example, on December 15, 2022, the European Union member states unanimously adopted the directive to implement pillar two rules. According to the directive, the member states were expected to enact pillar two rules into domestic law in 2023, with certain elements becoming effective for fiscal years beginning on or after December 31, 2023. On August 4, 2023, Canada released draft legislation to enact certain components of the pillar two proposals into Canadian law as the Global Minimum Tax Act (“GMTA”), which was enacted on June 20, 2024. The GMTA is generally aligned with the model rules proposed by the OECD and is effective for fiscal years beginning on or after December 31, 2023. The United States did not announce plans to enact the tax measures under the two-pillar plan. On February 1, 2023, the U.S. Financial Accounting Standards Board indicated that they believe the minimum tax imposed under pillar two is an alternative minimum tax, and, accordingly, deferred tax assets and liabilities associated with the minimum tax would not be recognized or adjusted for the estimated future effects of the minimum tax but would be recognized in the period incurred. The OECD has published model rules and other guidance with respect to pillar two, which are generally consistent with the agreement reached by the Inclusive Framework in October 2021. On February 1, 2023, the Inclusive Framework released a package of technical and administrative guidance on the implementation of pillar two, including the scope of companies that will be subject to the Global Anti-Base Erosion Rules, transition rules, and guidance on domestic minimum taxes that countries may choose to adopt, among other topics. On December 18, 2023 the OECD announced plans to release additional guidance on model rules and to start the peer review process in 2024. On June 17, 2024, the OECD published further administrative guidance to clarify the operation of the model rules. While many jurisdictions in which the Company operates have adopted the global minimum tax provision of the OECD pillar two effective for tax years beginning in January 2024, the Company has concluded that there is minimal impact to its 2024 tax rate due to the accounting for the tax effects of intercompany transactions. The Company expects that there is risk that the impact of the global minimum tax may eventually result in an increase to its overall effective tax rate.

Previous wording

Based on current patent expiration dates, settlement agreements and/or competitive information, we have identified one product, Prolensa®, which began facing LOE in the fourth quarter of 2023, which in the aggregate accounted for approximately 1% of our total revenues in 2023. While we expect our risk of LOE to be limited over the next five years, this could change based on, among other things, successful challenge to our patents, settlement of existing or future patent litigation and at-risk generic launches. We believe the entry into the market of generic competition generally would have an adverse impact on the volume and/or pricing of the affected products, however we are unable to predict the magnitude or timing of this impact.

Current wording

Prolensa® began facing LOE in the fourth quarter of 2023, which in the aggregate accounted for approximately 1% of our total revenues in 2023. While we expect our risk of LOE to be limited over the next five years, this could change based on, among other things, successful challenge to our patents, settlement of existing or future patent litigation and at-risk generic launches. We believe the entry into the market of generic competition generally would have an adverse impact on the volume and/or pricing of the affected products, however we are unable to predict the magnitude or timing of this impact.

Previous wording

Our unaudited operating results for the three months ended March 31, 2024 and 2023 were as follows:

Current wording

Our unaudited operating results for the three and six months ended June 30, 2024 and 2023 were as follows:

Previous wording

The Surgical segment revenue was $197 million and $183 million for the three months ended March 31, 2024 and 2023, respectively, an increase of $14 million, or 8%. The increase was primarily driven by: (i) increased demand of consumables, (ii) increased demand of implantables, driven by our premium IOL portfolio and (iii) increased system sales. This increase included: (i) an increase in volumes of $10 million and (ii) an increase in net realized pricing of $5 million, partially offset by the unfavorable effect of foreign currencies of $1 million.

Current wording

The Surgical segment revenue was $209 million and $195 million for the three months ended June 30, 2024 and 2023, respectively, an increase of $14 million, or 7%. The increase was primarily driven by: (i) increased system sales, (ii) increased demand of consumables and (iii) increased demand of implantables, driven by our premium IOL portfolio. This increase included: (i) an increase in volumes of $12 million and (ii) an increase in net realized pricing of $6 million, partially offset by the unfavorable effect of foreign currencies of $4 million.

Previous wording

Cash discounts and allowances, returns, rebates, chargebacks and distribution fees as a percentage of gross product sales were 36.7% and 27.4% for the three months ended March 31, 2024 and 2023, respectively, an increase of 9.3% percentage points, and is primarily attributable to the increase in rebates, primarily as a result of XIIDRA®and MIEBO®.

Current wording

Cash discounts and allowances, returns, rebates, chargebacks and distribution fees as a percentage of gross product sales were 35.4% and 29.1% for the three months ended June 30, 2024 and 2023, respectively, an increase of 6.3% percentage points, and is primarily attributable to the increase in rebates, primarily as a result of XIIDRA®and MIEBO®.

Previous wording

Contribution (product sales revenue less cost of goods sold, exclusive of amortization and impairments of intangible assets) increased by $114 million, primarily driven by: (i) the increase in volumes, including related to the launch of MIEBO® during September 2023, (ii) contribution associated with acquisitions entered into subsequent to March 31, 2023, (iii) the increase in net realized pricing, as previously discussed and (iv) higher manufacturing efficiency ramp-up costs of our Daily SiHy lenses during the three months ended March 31, 2023. These increases were partially offset by the unfavorable impact of foreign currencies.

Current wording

Contribution (product sales revenue less cost of goods sold, exclusive of amortization and impairments of intangible assets) increased by $117 million, primarily driven by: (i) the increase in volumes, including related to the launch of MIEBO® during September 2023, (ii) contribution associated with acquisitions entered into subsequent to June 30, 2023 and (iii) the increase in net realized pricing, as previously discussed. These increases were partially offset by the unfavorable impact of foreign currencies.

Previous wording

Cost of goods sold as a percentage of Product sales was 38.7% and 40.0% for the three months ended March 31, 2024 and 2023, respectively.

Current wording

Cost of goods sold as a percentage of Product sales was 39.7% and 40.4% for the three months ended June 30, 2024 and 2023, respectively.

Previous wording

SG&A expenses were $504 million and $418 million for the three months ended March 31, 2024 and 2023, respectively, an increase of $86 million, or 21%. The increase was primarily attributable to higher selling and advertising and promotion costs, primarily attributable to XIIDRA® and the launch of MIEBO®.

Current wording

SG&A expenses were $535 million and $417 million for the three months ended June 30, 2024 and 2023, respectively, an increase of $118 million, or 28%. The increase was primarily attributable to: (i) higher selling and advertising and promotion costs, primarily attributable to XIIDRA® and the launch of MIEBO® and (ii) higher professional fees.

Previous wording

Amortization of Intangible assets was $74 million and $57 million for the three months ended March 31, 2024 and 2023, respectively, an increase of $17 million, or 30%, primarily due to assets acquired through acquisitions, as previously discussed, partially offset by fully amortized intangible assets no longer being amortized in 2024.

Current wording

Amortization of Intangible assets was $74 million and $56 million for the three months ended June 30, 2024 and 2023, respectively, an increase of $18 million, or 32%, primarily due to assets acquired through acquisitions, as previously discussed, partially offset by fully amortized intangible assets no longer being amortized in 2024.

Previous wording

The Pharmaceuticals segment profit was $53 million and $46 million for the three months ended March 31, 2024 and 2023, respectively, an increase of $7 million, or 15%. The increase was primarily driven by increased contribution, primarily driven by XIIDRA®and MIEBO®, partially offset by selling and advertising and promotional expenses related to XIIDRA® and MIEBO®.

Current wording

The Pharmaceuticals segment profit was $78 million and $68 million for the three months ended June 30, 2024 and 2023, respectively, an increase of $10 million, or 15%. The increase was primarily driven by increased contribution, primarily driven by XIIDRA®and MIEBO®, partially offset by selling and advertising and promotional expenses related to XIIDRA® and MIEBO®.

Previous wording

Foreign exchange and other primarily includes translation gains/losses on intercompany balances and third-party liabilities and the gain/loss due to the change in fair value of foreign currency exchange contracts. Foreign exchange and other was$0 and a net loss of $6 million for the three months ended March 31, 2024 and 2023, respectively.

Current wording

Foreign exchange and other primarily includes translation gains/losses on intercompany balances and third-party liabilities and the gain/loss due to the change in fair value of foreign currency exchange contracts. Foreign exchange and other was a net loss of$3 million and $9 million for the three months ended June 30, 2024 and 2023, respectively.

Previous wording

Provision for income taxes were $73 million and $33 million for the three months ended March 31, 2024 and 2023, respectively, an increase of $40 million. The increase in income taxes was primarily related to: (i) a change in the jurisdictional mix of earnings and (ii) discrete tax effects of: (a) the filings of certain tax returns and (b) a change in the deduction for stock compensation.

Current wording

Provision for income taxes were $72 million and $10 million for the three months ended June 30, 2024 and 2023, respectively, an increase of $62 million. The increase in income taxes was primarily related to: (i) a change in the jurisdictional mix of earnings and (ii) discrete tax effects of: (a) a reduction of certain tax attributes recorded in the previous year, (b) the filings of certain tax returns and (c) a change in the deduction for stock compensation.

Previous wording

Net loss attributable to Bausch + Lomb Corporation was $167 million and $90 million for the three months ended March 31, 2024 and 2023, respectively, a decrease in our results of $77 million and was primarily due to: (i) an increase in interest expense of $49 million and (ii) the increase in the provision for income taxes of $40 million, partially offset by the increase in our operating results of $8 million, each as previously discussed.

Current wording

Net loss attributable to Bausch + Lomb Corporation was $151 million and $32 million for the three months ended June 30, 2024 and 2023, respectively, a decrease in our results of $119 million and was primarily due to: (i) the increase in the provision for income taxes of $62 million, (ii) the increase in interest expense of $44 million and (iii) the decrease in our operating results of $17 million, each as previously discussed.

Previous wording

Our revenues were $1,099 million and $931 million for the three months ended March 31, 2024 and 2023, respectively, an increase of $168 million, or 18%. The increase was attributable to: (i) incremental sales attributable to acquisitions of $88 million, primarily within our Pharmaceuticals segment, (ii) increased volumes of $70 million across each of our segments and (iii) increased net realized pricing of $32 million, primarily driven by our Vision Care segment. The increases in revenue were partially offset by: (i) the unfavorable impact of foreign currencies of $20 million, primarily in Asia, and (ii) the impact of divestitures and discontinuations of $2 million, particularly the discontinuation of certain products within our Vision Care and Pharmaceuticals segments.

Current wording

Our revenues were $2,315 million and $1,966 million for the six months ended June 30, 2024 and 2023, respectively, an increase of $349 million, or 18%. The increase was attributable to: (i) incremental sales attributable to acquisitions of $192 million, primarily within our Pharmaceuticals segment, (ii) increased volumes of $145 million across each of our segments and (iii) increased net realized pricing of $63 million, primarily driven by our Vision Care segment. The increases in revenue were partially offset by: (i) the unfavorable impact of foreign currencies of $47 million, primarily in Asia, and (ii) the impact of divestitures and discontinuations of $4 million, particularly the discontinuation of certain products within our Pharmaceuticals and Vision Care segments.

Previous wording

The Vision Care segment revenue was $635 million and $587 million for the three months ended March 31, 2024 and 2023, respectively, an increase of $48 million, or 8%. The increase was primarily driven by sales from Lumify®, PreserVision® and our dry eye portfolio within our consumer eye care business and SiHy Daily lenses within our contact lens business. This increase included: (i) an increase in net pricing of $36 million, (ii) an increase in volumes of $22 million and (iii) incremental sales attributable to acquisitions driven by the acquisition of the Blink® Product Line in July 2023, partially offset by: (i) the unfavorable impact of foreign currencies of $18 million, primarily in Asia and Russia, and (ii) the impact discontinuations.

Current wording

The Vision Care segment revenue was $1,332 million and $1,233 million for the six months ended June 30, 2024 and 2023, respectively, an increase of $99 million, or 8%. The increase was primarily driven by sales from our dry eye portfolio, PreserVision® and Lumify® within our consumer eye care business and SiHy Daily lenses within our contact lens business. This increase included: (i) an increase in net pricing of $63 million, (ii) an increase in volumes of $51 million and (iii) incremental sales attributable to acquisitions driven by the acquisition of the Blink® Product Line in July 2023, partially offset by: (i) the unfavorable impact of foreign currencies of $38 million, primarily in Asia and Russia, and (ii) the impact of discontinuations.

Previous wording

The Pharmaceuticals segment revenue was $267 million and $161 million for the three months ended March 31, 2024 and 2023, respectively, an increase of $106 million, or 66%. The increase was primarily driven by: (i) the XIIDRA Acquisition, (ii) the launch of MIEBO® in September 2023 and (iii) increased demand of certain products within our generics business. This increase included: (i) incremental sales from the XIIDRA Acquisition of $79 million and (ii) an increase in volumes of $38 million, partially offset by: (i) a decrease in net realized pricing of $9 million, (ii) the unfavorable effect of foreign currencies of $1 million and (iii) the impact of discontinuations of $1 million.

Current wording

The Pharmaceuticals segment revenue was $577 million and $355 million for the six months ended June 30, 2024 and 2023, respectively, an increase of $222 million, or 63%. The increase was primarily driven by: (i) the XIIDRA Acquisition, (ii) the launch of MIEBO® in September 2023 and (iii) increased demand of certain products within our generics business. This increase included: (i) incremental sales from the XIIDRA Acquisition of $168 million and (ii) an increase in volumes of $72 million, partially offset by: (i) a decrease in net realized pricing of $11 million, (ii) the unfavorable effect of foreign currencies of $4 million and (iii) the impact of discontinuations of $3 million.

Previous wording

Cost of goods sold was $423 million and $371 million for the three months ended March 31, 2024 and 2023, respectively, an increase of $52 million, or 14%. The increase was primarily driven by: (i) costs of sales associated with acquisitions entered into subsequent to March 31, 2023 and (ii) higher volumes.

Current wording

Cost of goods sold was $905 million and $788 million for the six months ended June 30, 2024 and 2023, respectively, an increase of $117 million, or 15%. The increase was primarily driven by: (i) costs of sales associated with acquisitions entered into subsequent to June 30, 2023, which includes the amortization of an interim contract and inventory step-up, and (ii) higher volumes.

Previous wording

R&D expenses were $82 million and $77 million for the three months ended March 31, 2024 and 2023, respectively, an increase of $5 million, or 6%, primarily due to certain products in development, as previously discussed.

Current wording

R&D expenses were $166 million and $162 million for the six months ended June 30, 2024 and 2023, respectively, an increase of $4 million, or 2%, primarily due to certain products in development, as previously discussed.

Previous wording

The Vision Care segment profit was $178 million and $154 million for the three months ended March 31, 2024 and 2023, respectively, an increase of $24 million, or 16%. The increase was primarily driven by increased contribution, driven by: (i) the increases in volume and pricing, as previously discussed and (ii) higher manufacturing efficiency ramp-up costs of our Daily SiHy lenses during the three months ended March 31, 2023. The increase in contribution was partially offset by higher advertising and promotional expenses in our consumer eye care business driven by Lumify® and the Blink®Product Line.

Current wording

The Vision Care segment profit was $370 million and $321 million for the six months ended June 30, 2024 and 2023, respectively, an increase of $49 million, or 15%. The increase was primarily driven by increased contribution, driven by: (i) the increases in volume and pricing, as previously discussed and (ii) higher manufacturing efficiency ramp-up costs of our Daily SiHy lenses during the six months ended June 30, 2023. The increase in contribution was partially offset by higher advertising and promotional expenses in our consumer eye care business driven by Lumify®, Blink® OTC product line, acquired in July 2023 and Blink TMNutriTears®, which began launching in June 2024.

Previous wording

Interest expense was$99 million and$50 million for the three months ended March 31, 2024 and 2023, respectively, an increase of$49 million. The increase is primarily attributable to: (i) interest expense associated with our October 2028 Secured Notes and September 2028 Term Facility (each as defined and discussed in further detail, under Item “— Liquidity and Capital Resources — Liquidity and Debt — Long-term Debt”), (ii) increased interest expense associated with the May 2027 Term Facility (as defined and discussed in further detail, under Item “— Liquidity and Capital Resources — Liquidity and Debt — Long-term Debt”) and (iii) interest expense related to the outstanding balance under our Revolving Credit Facility (as defined and discussed in further detail, under Item “— Liquidity and Capital Resources — Liquidity and Debt — Long-term Debt”). See Note 10, “FINANCING ARRANGEMENTS” to our unaudited interim Condensed Consolidated Financial Statements for further details regarding the October 2028 Secured Notes, September 2028 Term Facility, the May 2027 Term Facility and the Revolving Credit Facility.

Current wording

Interest expense was $201 million and $108 million for the six months ended June 30, 2024 and 2023, respectively, an increase of $93 million. The increase was primarily attributable to: (i) interest expense associated with our October 2028 Secured Notes and September 2028 Term Facility (each as defined and discussed in further detail, under Item “— Liquidity and Capital Resources — Liquidity and Debt — Long-term Debt”), (ii) interest expense related to the outstanding balance under our Revolving Credit Facility (as defined and discussed in further detail, under Item “— Liquidity and Capital Resources — Liquidity and Debt — Long-term Debt”) and (iii) increased interest expense associated with the May 2027 Term Facility (as defined and discussed in further detail, under Item “— Liquidity and Capital Resources — Liquidity and Debt — Long-term Debt”). See Note 10, “FINANCING ARRANGEMENTS” to our unaudited interim Condensed Consolidated Financial Statements for further details regarding the May 2027 Term Facility and the Revolving Credit Facility.

Previous wording

Net cash provided by operating activities was $41 million for the three months ended March 31, 2024, as compared to net cash used by operating activities of $56 million for the three months ended March 31, 2023, an increase of $97 million.

Current wording

Net cash provided by operating activities was $56 million for the six months ended June 30, 2024, as compared to net cash used by operating activities of $80 million for the six months ended June 30, 2023, an increase of $136 million.

Previous wording

Net cash provided by operating activities for the three months ended March 31, 2024 was positively impacted by: (i) our net earnings, excluding non-cash expenses and other adjustments primarily for depreciation and amortization, deferred income taxes and share-based compensation, and (ii) changes in our operating assets and liabilities driven by the ongoing impact of the XIIDRA Acquisition, partially offset by an increase in inventories.

Current wording

Net cash provided by operating activities for the six months ended June 30, 2024 was positively impacted by our net earnings, excluding non-cash expenses and other adjustments primarily for depreciation and amortization, deferred income taxes and share-based compensation, partially offset by changes in our operating assets and liabilities driven by: (i) interest payments associated with our October 2028 Secured Notes, (ii) the increase in Trade receivables, net driven by the increase and timing of sales and (iii) the increase in inventories.

Previous wording

Net cash used in operating activities for the three months ended March 31, 2023 was negatively impacted by a strategic increase in inventories in anticipation of future product launches and to help mitigate supply-chain challenges.

Current wording

Net cash used in operating activities for the six months ended June 30, 2023 was negatively impacted by a strategic increase in inventories in anticipation of future product launches and to help mitigate supply-chain challenges and timing of payments.

Previous wording

Net cash used in investing activities was $57 million and $64 million for the three months ended March 31, 2024 and 2023, respectively, a decrease of $7 million and was primarily driven by increases in purchases of property, plant and equipment, partially offset by cash used in the 2023 acquisition of AcuFocus, as previously discussed.

Current wording

Net cash used in investing activities was $131 million and $92 million for the six months ended June 30, 2024 and 2023, respectively, an increase of $39 million and was primarily driven by increases in purchases of property, plant and equipment, partially offset by cash used in the 2023 acquisition of AcuFocus, as previously discussed.

Previous wording

Net cash provided by financing activities was $12 million and $91 million for the three months ended March 31, 2024 and 2023, respectively, a decrease of $79 million. The decrease is primarily attributable to less borrowings under the Revolving Credit Facility (as defined below) and higher repayments of debt. For the three months ended March 31, 2024, issuances of long-term debt, net of discounts were $75 million, representing borrowings under the Revolving Credit Facility and repayments of debt were $58 million, which included $50 of repayments under the Revolving Credit Facility. For the three months ended March 31, 2023, issuances of long-term debt, net of discounts were $100 million, representing borrowings under the Revolving Credit Facility and repayments were $6 million.

Current wording

Net cash provided by financing activities was $52 million and $181 million for the six months ended June 30, 2024 and 2023, respectively, a decrease of $129 million. The decrease is primarily attributable to less borrowings under the Revolving Credit Facility and higher repayments of debt. For the six months ended June 30, 2024, issuances of long-term debt, net of discounts were $125 million, representing borrowings under the Revolving Credit Facility and repayments of debt were $65 million, which included $50 million of repayments under the Revolving Credit Facility. For the six months ended June 30, 2023, issuances of long-term debt, net of discounts were $200 million, representing borrowings under the Revolving Credit Facility and repayments were $13 million.