Viatris IncVTRS
Viatris Inc Goodwill & Intangibles Disclosure
Goodwill and Intangible Assets
Goodwill
The changes in the carrying amount of goodwill for the years ended December 31, 2025 and 2024 are as follows:
| (In millions) | Developed Markets (1) | Greater China | JANZ (2) | Emerging Markets (3) | Total | ||||||||||||||||||||||||
| Balance at December 31, 2023 | $ | 7,107.4 | $ | 932.8 | $ | 645.7 | $ | 1,181.2 | $ | 9,867.1 | |||||||||||||||||||
| Acquisitions | 19.5 | — | — | — | 19.5 | ||||||||||||||||||||||||
| Impairment | — | — | (321.0) | — | (321.0) | ||||||||||||||||||||||||
| Foreign currency translation | (374.0) | (11.3) | (29.6) | (17.4) | (432.3) | ||||||||||||||||||||||||
| Balance at December 31, 2024 | $ | 6,752.9 | $ | 921.5 | $ | 295.1 | $ | 1,163.8 | $ | 9,133.3 | |||||||||||||||||||
| Impairment | (2,261.0) | — | (300.8) | (375.0) | (2,936.8) | ||||||||||||||||||||||||
| Foreign currency translation | 532.6 | 11.7 | 5.7 | 8.2 | 558.2 | ||||||||||||||||||||||||
| Balance at December 31, 2025 | $ | 5,024.5 | $ | 933.2 | $ | — | $ | 797.0 | $ | 6,754.7 | |||||||||||||||||||
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(1)Balance as of December 31, 2025 includes an accumulated impairment loss of $3.19 billion. Balances as of December 31, 2024 and 2023 include an accumulated impairment loss of $929.0 million.
(2)Balances as of December 31, 2025, 2024, and 2023 include an accumulated impairment loss of $651.8 million, $351.0 million, and $30.0 million, respectively.
(3)Balance as of December 31, 2025 includes an accumulated impairment loss of $499.0 million. Balances as of December 31, 2024 and 2023 include an accumulated impairment loss of $124.0 million.
The Company reviews goodwill for impairment annually on April 1st or more frequently if events or changes in circumstances indicate that the carrying value of goodwill may not be recoverable. During the first quarter of 2025, the Company experienced a sharp and sustained decline in its share price and significantly increased uncertainty and volatility in the geopolitical and economic environments in which the Company operates. As a result of these factors, the Company determined that a triggering event had occurred for each of its reporting units and performed an interim goodwill impairment test as of March 31, 2025.
The Company also performed the annual goodwill impairment test as of April 1, 2025. There were no significant changes from the interim goodwill test performed at March 31, 2025 and the results were consistent with the interim goodwill impairment test. Also, no triggering events have been identified since the April 1, 2025 impairment test date.
The Company performed both its interim and annual goodwill impairment tests on a quantitative basis for its five reporting units, North America, Europe, Emerging Markets, JANZ, and Greater China. In estimating each reporting unit’s fair value, the Company performed an extensive valuation analysis, utilizing a discounted cash flow approach. The determination of the fair value of the reporting units requires the Company to make significant estimates and assumptions that affect the reporting unit’s expected future cash flows. These estimates and assumptions, utilizing Level 3 inputs, primarily include, but are not limited to, the discount rate, terminal growth rates, operating income before depreciation and amortization, capital expenditures forecasts and control premiums.
For the March 31, 2025 interim goodwill impairment test, when compared to the prior year annual goodwill impairment test completed on April 1, 2024, the significantly increased uncertainty and volatility in the geopolitical and economic environments in which the Company operates increased the Company’s business risks, including, but not limited to, the potential for continued or additional drug pricing reduction pressures, general uncertainty related to timing of responses and approvals from the FDA resulting from evolving regulatory priorities and associated changes to the operations of the agency, and the potential for adverse impacts from future tariffs and trade restrictions. The negative impact of any or all of these factors could be material. The significant increase in business risks and uncertainty led to an increase in discount rate assumptions impacting all reporting units as compared to the April 1, 2024 annual goodwill impairment test.
As of March 31, 2025 (prior to the impairment charges noted below), the allocation of the Company’s total goodwill was as follows: North America $3.09 billion, Europe $3.92 billion, Emerging Markets $1.17 billion, JANZ $0.30 billion and Greater China $0.92 billion.
In conjunction with its March 31, 2025 interim goodwill impairment test, the Company recorded the following impairment charges in the first quarter of 2025:
| (In millions) | North America | Europe | JANZ | Emerging Markets | Total | ||||||||||||||||||||||||
Impairment charge | $ | 707.0 | $ | 1,554.0 | $ | 300.8 | $ | 375.0 | $ | 2,936.8 | |||||||||||||||||||
For the North America reporting unit at March 31, 2025 and April 1, 2025, the Company forecasted cash flows for the next 10 years. During the forecast period, the revenue compound annual growth rate was approximately 3.1%. A terminal year value was calculated with a negative 3.0% revenue growth rate applied. The discount rate utilized was 12.5% and the estimated tax rate was 24.8%.
For the Europe reporting unit at March 31, 2025 and April 1, 2025, the Company forecasted cash flows for the next 10 years. During the forecast period, the revenue compound annual growth rate was approximately 3.3%. A terminal year value was calculated with a 2.0% revenue growth rate applied. The discount rate utilized was 12.0% and the estimated tax rate was 15.8%.
For the Emerging Markets reporting unit at March 31, 2025 and April 1, 2025, the Company forecasted cash flows for the next 10 years. During the forecast period, the revenue compound annual growth rate was approximately 3.5%. A terminal year value was calculated with a 2.0% revenue growth rate applied. The discount rate utilized was 14.5% and the estimated tax rate was 16.7%.
For the JANZ reporting unit at March 31, 2025 and April 1, 2025, the Company forecasted cash flows for the next 10 years. During the forecast period, the revenue compound annual growth rate was approximately negative 0.9%. A terminal year value was calculated with a 1.0% revenue growth rate applied. The discount rate utilized was 8.5% and the estimated tax rate was 30.2%. After the goodwill impairment charge recorded during the first quarter of 2025, there is no remaining goodwill allocated to the JANZ reporting unit.
Following the goodwill impairment charges recorded in these reporting units, since the carrying value of the reporting units is equal to their estimated fair value as of March 31, 2025 and April 1, 2025, if market conditions or the projected results were to negatively change, it may be necessary to record further impairment charges to one or more of these reporting units in future periods. Any such future charges could be material.
For the Greater China reporting unit, the estimated fair value exceeded its carrying value by approximately $322.0 million or 5.8% for both the March 31, 2025 and April 1, 2025 goodwill impairment tests. As it relates to the discounted cash flow approach for the Greater China reporting unit at March 31, 2025 and April 1, 2025, the Company forecasted cash flows for the next 10 years. During the forecast period, the revenue compound annual growth rate was approximately 1.6%. A terminal year value was calculated with a negative 1.5% revenue growth rate applied. The discount rate utilized was 15.0% and the estimated tax rate was 24.7%. If all other assumptions are held constant, a reduction in the terminal value growth rate by 3.5% or an increase in discount rate by 1.0% would result in an impairment charge for the Greater China reporting unit.
In conjunction with its April 1, 2024 annual goodwill impairment test, the Company recorded a goodwill impairment charge of $321.0 million during the second quarter of 2024 related to its JANZ reporting unit. The impairment charge was primarily the result of a 1.0% increase in the discount rate and a 0.5% reduction in the terminal growth rate assumption for the reporting unit compared with the assumptions used for the April 1, 2023 annual goodwill impairment test.
In the fourth quarter of 2023, the OTC Business met the criteria to be classified as held for sale. The Company allocated goodwill to its OTC Business using a relative fair value approach and recorded a goodwill impairment charge of $580.1 million in that quarter within the Europe (majority of the charge), JANZ and Emerging Markets reporting units. The goodwill impairment charge was the result of the estimated proceeds less selling costs from the planned divestiture of the OTC Business being below the carrying value of the net assets of the disposal group. Refer to Note 5 Divestitures for additional information.
Due to the inherent uncertainty involved in making these estimates, actual results could differ from those estimates. In addition, changes in underlying assumptions, especially as they relate to the key assumptions detailed, could have a significant impact on the fair value of the reporting units.
Intangible Assets, Net
Intangible assets consist of the following components at December 31, 2025 and 2024:
| (In millions) | Weighted Average Life (Years) | Cost | Accumulated Amortization | Net Book Value | |||||||||||||||||||
| December 31, 2025 | |||||||||||||||||||||||
Product rights, licenses and other (1) | 13 | $ | 34,506.8 | $ | 20,110.7 | $ | 14,396.1 | ||||||||||||||||
| In-process research and development | 706.0 | — | 706.0 | ||||||||||||||||||||
| $ | 35,212.8 | $ | 20,110.7 | $ | 15,102.1 | ||||||||||||||||||
| December 31, 2024 | |||||||||||||||||||||||
Product rights, licenses and other (1) | 13 | $ | 33,348.5 | $ | 17,091.8 | $ | 16,256.7 | ||||||||||||||||
| In-process research and development | 814.2 | — | 814.2 | ||||||||||||||||||||
| $ | 34,162.7 | $ | 17,091.8 | $ | 17,070.9 | ||||||||||||||||||
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(1)Represents amortizable intangible assets. Other intangible assets consist principally of customer lists and contractual rights.
During the year ended December 31, 2024, the Company recorded IPR&D assets of approximately $675.0 million as part of the Idorsia Transaction. Refer to Note 4 Acquisitions and Other Transactions for additional information.
Product rights and licenses are primarily comprised of the products marketed at the time of acquisition. These product rights and licenses relate to numerous individual products, the net book value of which, by product category, is as follows:
| (In millions) | Developed Markets | Greater China | JANZ | Emerging Markets | December 31, 2025 | ||||||||||||||||||||||||
| Brands | $ | 5,656.0 | $ | 4,355.3 | $ | 779.2 | $ | 2,319.2 | $ | 13,109.7 | |||||||||||||||||||
| Generics | 972.0 | 6.1 | 167.0 | 141.3 | 1,286.4 | ||||||||||||||||||||||||
| Total Product Rights and Licenses | $ | 6,628.0 | $ | 4,361.4 | $ | 946.2 | $ | 2,460.5 | $ | 14,396.1 | |||||||||||||||||||
| (In millions) | Developed Markets | Greater China | JANZ | Emerging Markets | December 31, 2024 | ||||||||||||||||||||||||
| Brands | $ | 6,464.6 | $ | 4,779.7 | $ | 860.5 | $ | 2,583.9 | $ | 14,688.7 | |||||||||||||||||||
| Generics | 1,214.6 | 8.7 | 183.8 | 160.8 | 1,567.9 | ||||||||||||||||||||||||
| Total Product Rights and Licenses | $ | 7,679.2 | $ | 4,788.4 | $ | 1,044.3 | $ | 2,744.7 | $ | 16,256.6 | |||||||||||||||||||
Amortization expense, intangible asset disposal & impairment charges and IPR&D intangible asset impairment charges (which are included as a component of amortization expense) are classified primarily within in the consolidated statements of operations, and were as follows for the years ended December 31, 2025, 2024 and 2023:
| Year ended December 31, | |||||||||||||||||
| (In millions) | 2025 | 2024 | 2023 | ||||||||||||||
| Intangible asset amortization expense | $ | 2,349.8 | $ | 2,351.5 | $ | 2,317.1 | |||||||||||
| IPR&D intangible asset impairment charges | 73.9 | 177.1 | — | ||||||||||||||
| — | 7.5 | 32.0 | |||||||||||||||
| Total intangible asset amortization expense (including disposal & impairment charges) | $ | 2,423.7 | $ | 2,536.1 | $ | 2,349.1 | |||||||||||
On July 18, 2025, the Company announced that a randomized, double-masked, vehicle-controlled, Phase 3 study to evaluate the efficacy and safety of pimecrolimus 0.3% (MR-139) ophthalmic ointment in subjects with blepharitis did not meet its primary endpoint of complete resolution of debris after six weeks of twice daily dosing. During the fourth quarter of 2025, the Company made the decision not to proceed with an additional Phase 3 study. As a result, the Company fully impaired the related IPR&D asset and recorded impairment expense of $71.7 million in its consolidated statements of operations.
During 2024, the Company concluded that certain of its IPR&D assets were fully impaired due to unfavorable clinical results and/or changes in market conditions which led to the termination of the development programs.
The assessment for impairment of finite-lived intangibles is based on our ability to recover the carrying value of the long-lived assets or asset grouping by analyzing the expected future undiscounted pre-tax cash flows specific to the asset or asset grouping. If the carrying amount is greater than the undiscounted cash flows, the Company recognizes an impairment loss for the excess of the carrying amount over the estimated fair value based on discounted cash flows.
Significant management judgment is involved in estimating the recoverability of these assets and is dependent upon the accuracy of the assumptions used in making these estimates, as well as how the estimates compare to the eventual future operating performance of the specific asset or asset grouping. The fair value of finite-lived intangible assets was calculated as the present value of the estimated future net cash flows using a market rate of return. The assumptions inherent in the estimated future cash flows include, among other things, the impact of the current competitive environment and future market expectations. Any future long-lived assets impairment charges could have a material impact on the Company’s consolidated financial condition and results of operations.
During the year ended December 31, 2023, the Company recognized intangible asset charges of approximately $32.0 million, recorded within Cost of Sales in the consolidated statements of operations, to write down the disposal group to fair value, less cost to sell, related to our commercialization rights in the Upjohn Distributor Markets, which was classified as held for sale. Refer to Note 5 Divestitures for additional information.
The Company’s IPR&D assets are tested at least annually for impairment or upon the occurrence of a triggering event. Impairment is determined to exist when the fair value of IPR&D assets, which is based upon updated forecasts and commercial development plans, is less than the carrying value of the assets being tested. The fair value of IPR&D was calculated as the present value of the estimated future net cash flows using a market rate of return. The assumptions inherent in the estimated future cash flows include, among other things, the impact of changes to the development programs, the projected development and regulatory time frames and the current competitive environment. Discount rates ranging between 14.5% and 20.0% were utilized in the valuations performed during the year ended December 31, 2025. Discount rates ranging between 11.0% and 24.0% were utilized in the valuations performed during the year ended December 31, 2024. Discount rates ranging between 10.0% and 24.0% were utilized in the valuations performed during the year ended December 31, 2023.
The fair value of both IPR&D and finite-lived intangible assets was determined based upon detailed valuations employing the income approach which utilized Level 3 inputs, as defined in Note 9 Financial Instruments and Risk Management. Changes to any of the Company’s assumptions including changes to or abandonment of development programs, regulatory timelines, discount rates or the competitive environment related to the assets could lead to future material impairment charges.
Intangible asset amortization expense for the years ending December 31, 2026 through 2030 is estimated to be as follows:
| (In millions) | |||||
| 2026 | $ | 2,337 | |||
| 2027 | 2,115 | ||||
| 2028 | 1,853 | ||||
| 2029 | 1,243 | ||||
| 2030 | 1,183 | ||||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 26, 2026 | Showing above |
| 2024 | Feb 27, 2025 | |
| 2023 | Feb 28, 2024 | |
| 2022 | Feb 27, 2023 | |
| 2020 | Mar 1, 2021 | |
About Goodwill & Intangibles Disclosures
Goodwill and intangible asset disclosures reveal the premium paid in acquisitions and how management assesses whether that premium retains its value. Since goodwill is no longer amortized under US GAAP, the annual impairment test is the only mechanism that adjusts carrying values downward — making the assumptions behind that test critically important for investors.
Key signals: a history of goodwill impairments suggests management consistently overpays for acquisitions. Watch the gap between reporting unit fair value and carrying amount — when fair value exceeds carrying amount by less than 10-20%, a small decline in business performance could trigger a write-down. For finite-lived intangibles, examine useful life assumptions across customer relationships, technology, and trade names; aggressive estimates inflate near-term earnings. Compare total intangibles-to-total-assets ratios against peers to assess acquisition dependency. Rising goodwill as a percentage of equity can signal balance sheet fragility.