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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2022
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____________to___________                 
Commission file number 001-39695
VIATRIS INC.
(Exact name of registrant as specified in its charter)
Delaware83-4364296
(State or other jurisdiction
of incorporation or organization)
(I.R.S. Employer
Identification No.)
1000 Mylan Boulevard, Canonsburg, Pennsylvania 15317
(Address of principal executive offices)
(724) 514-1800
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class:Trading Symbol(s)Name of Each Exchange on Which Registered:
Common Stock, par value $0.01 per shareVTRSThe NASDAQ Stock Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes      No  
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filerAccelerated filer
Non-accelerated filer
Smaller reporting company
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
The number of shares of common stock outstanding, par value $0.01 per share, of the registrant as of May 4, 2022 was 1,212,326,908.


Table of Contents
VIATRIS INC. AND SUBSIDIARIES
INDEX TO FORM 10-Q
For the Quarterly Period Ended
March 31, 2022
  
Page
PART I — FINANCIAL INFORMATION
ITEM 1.Condensed Consolidated Financial Statements (unaudited)
ITEM 2.
ITEM 3.
ITEM 4.
PART II — OTHER INFORMATION
ITEM 1.
ITEM 1A.
ITEM 6.

















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Table of Contents
Glossary of Defined Terms

Unless the context requires otherwise, references to “Viatris,” “the Company,” “we,” “us” or “our” in this Form 10-Q (defined below) refer to Viatris Inc. and its subsidiaries. We also have used several other terms in this Form 10-Q, most of which are explained or defined below. Some amounts in this Form 10-Q may not add due to rounding.


2003 LTIPMylan N.V. Amended and Restated 2003 Long-Term Incentive Plan
2021 Form 10-K Viatris’ annual report on Form 10-K for the fiscal year ended December 31, 2021, as amended
Adjusted EBITDANon-GAAP financial measure that the Company believes is appropriate to provide information to investors - EBITDA (defined below) is further adjusted for share-based compensation expense, litigation settlements, and other contingencies, net, restructuring and other special items
ANDAAbbreviated New Drug Application
AOCEAccumulated other comprehensive earnings
APIsActive pharmaceutical ingredients
ARVAntiretroviral medicines
ASCAccounting Standards Codification
ASUAccounting Standards Update
BioconBiocon Limited
Biocon BiologicsBiocon Biologics Limited, a majority owned subsidiary of Biocon
Biocon Biologics Transaction
The pending transaction between Viatris and Biocon Biologics pursuant to which Viatris will contribute its biosimilars portfolio to Biocon Biologics
Biocon AgreementThe transaction agreement between Viatris and Biocon Biologics, dated February 27, 2022, relating to the Biocon Biologics Transaction
BiogenBiogen MA Inc. and Biogen International GmbH, collectively
Business Combination AgreementBusiness Combination Agreement, dated as of July 29, 2019, as amended from time to time, among Viatris, Mylan, Pfizer and certain of their affiliates
CATCompetition Appeals Tribunal
CJEUEuropean Court of Justice
clean energy investmentsUsed to define the three equity method investments the Company has in limited liability companies that own refined coal production plants whose activities qualify for income tax credits under Section 45 of the Code
CMACompetition and Markets Authority
CodeThe U.S. Internal Revenue Code of 1986, as amended
CombinationRefers to Mylan combining with Pfizer's Upjohn Business in a Reverse Morris Trust transaction to form Viatris on November 16, 2020
Commercial Paper ProgramThe $1.65 billion unsecured commercial paper program entered into as of November 16, 2020 by Viatris, as issuer, Mylan Inc., Utah Acquisition Sub Inc. and Mylan II B.V., as guarantors, and certain dealers from time to time
CommissionEuropean Commission
COVID-19Novel coronavirus disease of 2019
CP NotesUnsecured, short-term commercial paper notes issued pursuant to the Commercial Paper Program
DCGIDrug Controller General of India
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Table of Contents
Developed Markets segmentViatris’ business segment that includes our operations primarily in the following markets: North America and Europe
DistributionPfizer's distribution to Pfizer stockholders all the issued and outstanding shares of Upjohn Inc.
DOJU.S. Department of Justice
 DRIP
Dividend Reinvestment and Share Purchase Plan
EBITDANon-GAAP financial measure that the Company believes is appropriate to provide information to investors - U.S. GAAP net earnings (loss) adjusted for net contribution attributable to equity method investments, income tax provision (benefit), interest expense and depreciation and amortization
EDPAU.S. District Court for the Eastern District of Pennsylvania
Emerging Markets segmentViatris’ business segment that includes, but is not limited to, our operations primarily in the following markets: Parts of Asia, the Middle East, South and Central America, Africa, and Eastern Europe
ERP systemEnterprise resource planning system
EUEuropean Union
Exchange Act Securities Exchange Act of 1934, as amended
FASBFinancial Accounting Standards Board
FCA
Financial Conduct Authority in the U.K.
FDAU.S. Food and Drug Administration
Form 10-QThis quarterly report on Form 10-Q for the quarterly period ended March 31, 2022
Greater China segmentViatris’ business segment that includes our operations primarily in the following markets: China, Taiwan and Hong Kong
GxGeneric drugs
IPRInter Partes review
IRSU.S. Internal Revenue Service
IRS Ruling
The private letter ruling issued by the IRS to Pfizer with respect to the Combination, dated as of March 17, 2020
ITInformation technology
JANZ segmentViatris’ business segment that includes our operations in the following markets: Japan, Australia and New Zealand
LIBORLondon Interbank Offered Rate
LillyEli Lilly and Company
maximum leverage ratio The maximum consolidated leverage ratio financial covenant requiring maintenance of a maximum ratio of consolidated total indebtedness as of the end of any quarter to consolidated EBITDA for the trailing four quarters as defined in the related credit agreements from time to time
MDLMultidistrict litigation
MPIMylan Pharmaceuticals Inc.
MylanMylan N.V. and its subsidiaries
Mylan IIMylan II B.V., a company incorporated under the laws of the Netherlands and an indirect wholly owned subsidiary of Viatris, in which legacy Mylan merged with and into
Mylan Inc. Euro NotesThe 2.125% Senior Notes due 2025 issued by Mylan Inc., which are fully and unconditionally guaranteed on a senior unsecured basis by Mylan II B.V., Viatris Inc. and Utah Acquisition Sub Inc.
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Table of Contents
Mylan Inc. U.S. Dollar NotesThe 4.200% Senior Notes due 2023, 3.125% Senior Notes due 2023, 4.550% Senior Notes due 2028, 5.400% Senior Notes due 2043 and 5.200% Senior Notes due 2048 issued by Mylan Inc., which are fully and unconditionally guaranteed on a senior unsecured basis by Mylan II B.V., Viatris Inc. and Utah Acquisition Sub Inc.
Mylan SecuritizationMylan Securitization LLC
NASDAQThe NASDAQ Stock Market
NDANew drug application
NHSNational Health Services
Note Securitization FacilityThe note securitization facility entered into in July 2021 for borrowings up to $200 million and expiring in August 2022
OTCOver-the-counter
PfizerPfizer Inc.
PlanViatris Inc. 2020 Stock Incentive Plan
PMSPharmascience Inc.
PSUsPerformance awards
PTABU.S. Patent Trial and Appeal Board
R&DResearch and development
Receivables FacilityThe $400 million accounts receivable entered into in August 2020 and expiring in April 2025
Registered Upjohn Notes
The 1.125% Senior Notes due 2022, 1.650% Senior Notes due 2025, 2.300% Senior Notes due 2027, 2.700% Senior Notes due 2030, 3.850% Senior Notes due 2040 and 4.000% Senior Notes due 2050 originally issued on October 29, 2021 registered with the SEC in exchange for the corresponding Unregistered Upjohn U.S. Dollar Notes in a similar aggregate principal amount and with terms substantially identical to the corresponding Unregistered Upjohn U.S. Dollar Notes and fully and unconditionally guaranteed by Mylan Inc., Mylan II and Utah Acquisition Sub Inc.
respiratory delivery platformPfizer’s proprietary dry powder inhaler delivery platform
restricted stock awardsThe Company’s nonvested restricted stock and restricted stock unit awards, including PSUs
Revolving FacilityThe $4.0 billion revolving facility dated as of July 1, 2021, by and among Viatris, certain lenders and issuing banks from time to time party thereto and Bank of America, N.A., as administrative agent
RICORacketeer Influenced and Corrupt Organizations Act
RSUsThe Company's unvested restricted stock unit awards
SanofiSanofi-Aventis U.S., LLC
SARsStock Appreciation Rights
SDNYU.S. District Court for the Southern District of New York
SECU.S. Securities and Exchange Commission
Securities ActSecurities Act of 1933, as amended
Senior U.S. Dollar NotesThe Upjohn U.S. Dollar Notes, the Utah U.S. Dollar Notes and the Mylan Inc. U.S. Dollar Notes, collectively
SeparationPfizer's transfer to Upjohn of substantially all the assets and liabilities comprising the Upjohn Business
Separation and Distribution AgreementSeparation and Distribution Agreement between Viatris and Pfizer, dated as of July 29, 2019, as amended from time to time
SG&ASelling, general and administrative expenses
5

Table of Contents
SOFRSecured overnight financial rate
Stock awardsStock options and SARs
TevaTeva Pharmaceutical Industries Ltd.
TSATransition service agreements
U.K.United Kingdom
U.S.United States
U.S. GAAPAccounting principles generally accepted in the U.S.
Unregistered Upjohn U.S. Dollar Notes
The 1.125% Senior Notes due 2022, 1.650% Senior Notes due 2025, 2.300% Senior Notes due 2027, 2.700% Senior Notes due 2030, 3.850% Senior Notes due 2040 and 4.000% Senior Notes due 2050 originally issued on June 22, 2020 by Upjohn Inc. (now Viatris Inc.) in a private offering exempt from the registration requirements of the Securities Act and fully and unconditionally guaranteed by Mylan Inc., Mylan II and Utah Acquisition Sub Inc.
UpjohnUpjohn Inc., a wholly owned subsidiary of Pfizer prior to the Distribution, that combined with Mylan and was renamed Viatris Inc.
Upjohn BusinessPfizer’s off-patent branded and generic established medicines business that, in connection with the Combination, was separated from Pfizer and combined with Mylan to form Viatris
Upjohn U.S. Dollar Notes
Senior unsecured notes denominated in U.S. dollars and originally issued by Upjohn Inc. or Viatris Inc. pursuant to an indenture dated June 22, 2020 and fully and unconditionally guaranteed by Mylan Inc., Mylan II B.V. and Utah Acquisition Sub Inc.
Utah Acquisition SubUtah Acquisition Sub Inc., a Delaware corporation and an indirect wholly owned subsidiary of Viatris
Utah Euro Notes
The 2.250% Senior Notes due 2024 and 3.125% Senior Notes due 2028 issued by Utah Acquisition Sub Inc., which are fully and unconditionally guaranteed on a senior unsecured basis by Mylan Inc., Viatris Inc. and Mylan II B.V.
Utah U.S. Dollar NotesThe 3.950% Senior Notes due 2026 and 5.250% Senior Notes due 2046 issued by Utah Acquisition Sub Inc., which are fully and unconditionally guaranteed on a senior unsecured basis by Mylan Inc., Viatris Inc. and Mylan II B.V.
ViatrisViatris Inc., formerly known as Upjohn Inc. prior to the completion of the Combination
YEN Term Loan Facility
The ¥40 billion term loan agreement dated as of July 1, 2021, by and among Viatris, Mizuho Bank, Ltd. and MUFG Bank, Ltd., as administrative agent
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PART I — FINANCIAL INFORMATION

VIATRIS INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Operations
(Unaudited; in millions, except per share amounts)
 Three Months Ended
March 31,
 20222021
Revenues:
Net sales$4,178.2 $4,400.1 
Other revenues13.5 30.2 
Total revenues4,191.7 4,430.3 
Cost of sales2,420.5 3,303.0 
Gross profit1,771.2 1,127.3 
Operating expenses:
Research and development142.3 184.1 
Selling, general and administrative915.3 1,186.5 
Litigation settlements and other contingencies, net6.2 22.9 
Total operating expenses1,063.8 1,393.5 
Earnings (loss) from operations707.4 (266.2)
Interest expense146.2 169.0 
Other expense, net33.7 6.1 
Earnings (loss) before income taxes527.5 (441.3)
Income tax provision128.3 596.3 
Net earnings (loss)$399.2 $(1,037.6)
Earnings (loss) per share attributable to Viatris Inc. shareholders
Basic$0.33 $(0.86)
Diluted$0.33 $(0.86)
Weighted average shares outstanding:
Basic1,210.5 1,207.5 
Diluted1,213.1 1,207.5 


See Notes to Condensed Consolidated Financial Statements
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VIATRIS INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Comprehensive Earnings (Loss)
(Unaudited; in millions)
 Three Months Ended
March 31,
 20222021
Net earnings (loss)$399.2 $(1,037.6)
Other comprehensive loss, before tax:
Foreign currency translation adjustment(469.2)(721.2)
Change in unrecognized (loss) gain and prior service cost related to defined benefit plans(2.6)0.8 
Net unrecognized gain on derivatives in cash flow hedging relationships0.2 3.3 
Net unrecognized gain on derivatives in net investment hedging relationships201.3 227.4 
Net unrealized loss on marketable securities(1.7)(0.9)
Other comprehensive loss, before tax(272.0)(490.6)
Income tax provision44.7 37.0 
Other comprehensive loss, net of tax(316.7)(527.6)
Comprehensive earnings (loss)$82.5 $(1,565.2)



See Notes to Condensed Consolidated Financial Statements
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VIATRIS INC. AND SUBSIDIARIES
Condensed Consolidated Balance Sheets
(Unaudited in millions, except share and per share amounts)
March 31,
2022
December 31,
2021
ASSETS
Assets
Current assets:
Cash and cash equivalents$752.4 $701.2 
Accounts receivable, net4,093.9 4,266.4 
Inventories3,797.3 3,977.7 
Prepaid expenses and other current assets1,763.6 1,957.6 
Assets held for sale1,337.1  
Total current assets11,744.3 10,902.9 
Property, plant and equipment, net3,150.2 3,188.6 
Intangible assets, net25,251.8 26,134.2 
Goodwill10,978.8 12,113.7 
Deferred income tax benefit1,285.8 1,332.7 
Other assets1,056.0 1,170.7 
Total assets$53,466.9 $54,842.8 
LIABILITIES AND EQUITY
Liabilities
Current liabilities:
Accounts payable$1,499.6 $1,657.4 
Short-term borrowings655.4 1,493.0 
Income taxes payable177.8 236.9 
Current portion of long-term debt and other long-term obligations2,606.1 1,877.5 
Liabilities held for sale277.7  
Other current liabilities4,426.3 4,619.6 
Total current liabilities9,642.9 9,884.4 
Long-term debt18,762.5 19,717.1 
Deferred income tax liability2,729.5 2,815.0 
Other long-term obligations1,884.3 1,933.6 
Total liabilities33,019.2 34,350.1 
Equity
Viatris Inc. shareholders’ equity
Common stock: $0.01 par value, 3,000,000,000 shares authorized; shares issued and outstanding: 1,212,323,483 and 1,209,507,463, respectively
12.1 12.1 
Additional paid-in capital18,555.1 18,536.1 
Retained earnings3,941.5 3,688.8 
Accumulated other comprehensive loss(2,061.0)(1,744.3)
Total equity20,447.7 20,492.7 
Total liabilities and equity$53,466.9 $54,842.8 

See Notes to Condensed Consolidated Financial Statements
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VIATRIS INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Equity
(Unaudited; in millions, except share amounts)
Additional Paid-In CapitalRetained
Earnings
Accumulated Other Comprehensive LossTotal
Equity
Common StockTreasury Stock
SharesCostSharesCost
Balance at December 31, 20211,209,507,463 $12.1 $18,536.1 $3,688.8  $ $(1,744.3)$20,492.7 
Net earnings— — — 399.2 — — — 399.2 
Other comprehensive loss, net of tax— — — — — — (316.7)(316.7)
Issuance of restricted stock and stock options exercised, net 2,816,020   — — — —  
Taxes related to the net share settlement of equity awards— — (9.3)— — — — (9.3)
Share-based compensation expense— — 28.3 — — — — 28.3 
Cash dividends declared, $0.12 per common share— — — (146.5)— — — (146.5)
Balance at March 31, 20221,212,323,483 $12.1 $18,555.1 $3,941.5  $ $(2,061.0)$20,447.7 
Additional Paid-In CapitalRetained
Earnings
Accumulated Other Comprehensive LossTotal
Equity
Common StockTreasury Stock
SharesCostSharesCost
Balance at December 31, 20201,206,895,644 $12.1 $18,438.8 $5,361.2  $ $(858.0)$22,954.1 
Net loss— — — (1,037.6)— — — (1,037.6)
Other comprehensive loss, net of tax— — — — — — (527.6)(527.6)
Issuance of restricted stock and stock options exercised, net 1,635,326 —  — — — —  
Taxes related to the net share settlement of equity awards— — (6.9)— — — — (6.9)
Share-based compensation expense— — 32.7 — — — — 32.7 
Balance at March 31, 20211,208,530,970 $12.1 $18,464.6 $4,323.6  $ $(1,385.6)$21,414.7 


See Notes to Condensed Consolidated Financial Statements
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Table of Contents
VIATRIS INC. AND SUBSIDIARIES
Condensed Consolidated Statements of Cash Flows
(Unaudited; in millions)
Three Months Ended
March 31,
 20222021
Cash flows from operating activities:
Net earnings (loss)$399.2 $(1,037.6)
Adjustments to reconcile net earnings (loss) to net cash provided by operating activities:
Depreciation and amortization736.0 1,422.5 
Share-based compensation expense28.3 32.7 
Deferred income tax (benefit) expense(52.8)288.4 
Loss from equity method investments(0.1)17.9 
Other non-cash items37.8 33.3 
Litigation settlements and other contingencies, net5.2 22.9 
Changes in operating assets and liabilities:
Accounts receivable(115.5)(59.8)
Inventories(69.1)(203.4)
Accounts payable(30.2)191.9 
Income taxes67.0 494.6 
Other operating assets and liabilities, net132.7 (354.6)
Net cash provided by operating activities1,138.5 848.8 
Cash flows from investing activities:
Cash received from acquisitions 277.0 
Capital expenditures(64.5)(49.5)
Purchase of marketable securities(8.6)(12.3)
Proceeds from the sale of marketable securities8.5 12.3 
Payments for product rights and other, net(7.4)(3.7)
Proceeds from the sale of assets5.1 12.5 
Net cash (used in) provided by investing activities(66.9)236.3 
Cash flows from financing activities:
Proceeds from issuance of long-term debt0.1  
Payments of long-term debt(0.1) 
Change in short-term borrowings, net(837.9)(1,063.9)
Taxes paid related to net share settlement of equity awards(9.9)(7.8)
Contingent consideration payments(15.5)(26.0)
Payments of financing fees(0.4) 
Cash dividends paid(145.1) 
Other items, net(0.2)(2.1)
Net cash used in financing activities(1,009.0)(1,099.8)
Effect on cash of changes in exchange rates(11.4)(22.2)
Net increase (decrease) in cash, cash equivalents and restricted cash51.2 (36.9)
Cash, cash equivalents and restricted cash — beginning of period706.2 850.0 
Cash, cash equivalents and restricted cash — end of period$757.4 $813.1 
See Notes to Condensed Consolidated Financial Statements
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VIATRIS INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited)

1.General
The accompanying unaudited condensed consolidated financial statements (“interim financial statements”) of Viatris Inc. and subsidiaries were prepared in accordance with U.S. GAAP and the rules and regulations of the SEC for reporting on Form 10-Q; therefore, as permitted under these rules, certain footnotes and other financial information included in audited financial statements were condensed or omitted. The interim financial statements contain all adjustments (consisting of only normal recurring adjustments) necessary to present fairly the interim results of operations, comprehensive earnings, financial position, equity and cash flows for the periods presented.
These interim financial statements should be read in conjunction with the consolidated financial statements and notes thereto in Viatris’ 2021 Form 10-K. The December 31, 2021 condensed consolidated balance sheet was derived from audited financial statements.
Turkey Highly Inflationary - Under ASC 830, Foreign Currency Matters (“ASC 830”), a highly inflationary economy is one that has cumulative inflation of approximately 100% or more over a three-year period. Effective April 1, 2022, we classified Turkey as highly inflationary. In accordance with ASC 830, starting with the second quarter of 2022, we will begin to use the U.S. dollar as our functional currency in Turkey, which historically utilized the Turkish lira as the functional currency. The impacted net sales for the three months ended March 31, 2022 and total assets at March 31, 2022 represented less than 1% of our consolidated net sales and total assets, respectively.
The interim results of operations, comprehensive earnings and cash flows for the three months ended March 31, 2022 are not necessarily indicative of the results to be expected for the full fiscal year or any other future period.
2.Revenue Recognition and Accounts Receivable
The Company recognizes revenues in accordance with ASC 606, Revenue from Contracts with Customers. Under ASC 606, the Company recognizes net revenue for product sales when control of the promised goods or services is transferred to our customers in an amount that reflects the consideration we expect to be entitled to in exchange for those goods or services. Revenues are recorded net of provisions for variable consideration, including discounts, rebates, governmental rebate programs, price adjustments, returns, chargebacks, promotional programs and other sales allowances. Accruals for these provisions are presented in the condensed consolidated financial statements as reductions in determining net sales and as a contra asset in accounts receivable, net (if settled via credit) and other current liabilities (if paid in cash).
Our net sales may be impacted by wholesaler and distributor inventory levels of our products, which can fluctuate throughout the year due to the seasonality of certain products, pricing, the timing of product demand, purchasing decisions and other factors. Such fluctuations may impact the comparability of our net sales between periods.
Consideration received from licenses of intellectual property is recorded as other revenues. Royalty or profit share amounts, which are based on sales of licensed products or technology, are recorded when the customer’s subsequent sales or usages occur. Such consideration is included in other revenues in the condensed consolidated statements of operations.
The following table presents the Company’s net sales by product category for each of our reportable segments for the three months ended March 31, 2022 and 2021, respectively:

(In millions)Three Months Ended March 31, 2022
Product CategoryDeveloped MarketsGreater ChinaJANZEmerging MarketsTotal
Brands$1,298.7 $569.7 $249.0 $436.7 $2,554.1 
Complex Gx and Biosimilars364.1  10.3 16.4 390.8 
Generics813.3 3.4 164.5 252.1 1,233.3 
Total$2,476.1 $573.1 $423.8 $705.2 $4,178.2 



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VIATRIS INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued

(In millions)Three Months Ended March 31, 2021
Product CategoryDeveloped MarketsGreater ChinaJANZEmerging MarketsTotal
Brands$1,403.7 $590.9 $284.0 $446.0 $2,724.6 
Complex Gx and Biosimilars312.0  8.9 8.0 328.9 
Generics855.9 1.0 189.0 300.7 1,346.6 
Total$2,571.6 $591.9 $481.9 $754.7 $4,400.1 

The following table presents net sales on a consolidated basis for select key products for the three months ended March 31, 2022 and 2021:
Three months ended March 31,
(In millions)20222021
Select Key Global Products
Lipitor ®
$440.1 $464.6 
Norvasc ®207.8 227.7 
Lyrica ®171.7 187.8 
Viagra ®129.8 139.6 
EpiPen® Auto-Injectors88.8 103.7 
Celebrex ®
85.2 89.0 
Effexor ®
77.5 76.6 
Creon ®74.7 69.9 
Zoloft ®
73.1 76.6 
Xalabrands53.0 57.9 
Select Key Segment Products
Dymista ®$44.0 $40.3 
Yupelri ®43.7 36.9 
Amitiza ®41.8 45.9 
Xanax ®40.0 45.1 
____________
(a)The Company does not disclose net sales for any products considered competitively sensitive.
(b)Products disclosed may change in future periods, including as a result of seasonality, competition or new product launches.
(c)Amounts for the three months ended March 31, 2022 include the unfavorable impact of foreign currency translations compared to the prior year period.
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VIATRIS INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued
Variable Consideration and Accounts Receivable
The following table presents a reconciliation of gross sales to net sales by each significant category of variable consideration during the three months ended March 31, 2022 and 2021, respectively:
Three Months Ended
March 31,
(In millions)20222021
Gross sales$7,198.3 $7,567.0 
Gross to net adjustments:
Chargebacks(1,584.2)(1,318.0)
Rebates, promotional programs and other sales allowances(1,205.9)(1,568.5)
Returns(82.6)(113.0)
Governmental rebate programs(147.4)(167.4)
Total gross to net adjustments$(3,020.1)$(3,166.9)
Net sales$4,178.2 $4,400.1 
No significant revisions were made to the methodology used in determining these provisions or the nature of the provisions during the three months ended March 31, 2022. Such allowances were comprised of the following at March 31, 2022 and December 31, 2021, respectively:
(In millions)March 31,
2022
December 31,
2021
Accounts receivable, net$1,707.1 $1,688.6 
Other current liabilities1,095.8 1,362.1 
Total$2,802.9 $3,050.7 
Accounts receivable, net was comprised of the following at March 31, 2022 and December 31, 2021, respectively:
(In millions)March 31,
2022
December 31,
2021
Trade receivables, net$3,556.9 $3,774.4 
Other receivables537.0 492.0 
Accounts receivable, net$4,093.9 $4,266.4 
Accounts Receivable Factoring Arrangements
We have entered into accounts receivable factoring agreements with financial institutions to sell certain of our non-U.S. accounts receivable. These transactions are accounted for as sales and result in a reduction in accounts receivable because the agreements transfer effective control over and risk related to the receivables to the buyers. Our factoring agreements do not allow for recourse in the event of uncollectibility, and we do not retain any interest in the underlying accounts receivable once sold. We derecognized $55.1 million and $29.6 million of accounts receivable as of March 31, 2022 and December 31, 2021, respectively, under these factoring arrangements.
3.Recent Accounting Pronouncements
Adoption of New Accounting Standard
In November 2021, the FASB issued Accounting Standards Update 2021-10, Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance (“ASU 2021-10”), which requires entities to provide annual disclosures about transactions with a government that are accounted for by applying a grant or contribution accounting model by analogy. We adopted the ASU prospectively on January 1, 2022. The additional annual disclosures required are not expected to have a material impact on our consolidated financial statements.
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VIATRIS INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued
There were no other significant changes in new accounting standards from those disclosed in Viatris’ 2021 Form 10-K. Refer to Viatris’ 2021 Form 10-K for additional information.
4.Share-Based Incentive Plan
Prior to the Distribution, Viatris adopted and Pfizer, in the capacity as Viatris’ sole stockholder at such time, approved the Plan which became effective as of the Distribution. In connection with the Combination, as of November 16, 2020, the Company assumed the 2003 LTIP, which had previously been approved by Mylan shareholders. The Plan and 2003 LTIP include (i) 72,500,000 shares of common stock authorized for grant pursuant to the Plan, which may include dividend payments payable in common stock on unvested shares granted under awards, (ii) 6,757,640 shares of common stock to be issued pursuant to the exercise of outstanding stock options granted to participants under the 2003 LTIP and assumed by Viatris in connection with the Combination and (iii) 13,535,627 shares of common stock subject to outstanding equity-based awards, other than stock options, assumed by Viatris in connection with the Combination, or that otherwise remain available for issuance under the 2003 LTIP.
Under the Plan and 2003 LTIP, shares are reserved for issuance to key employees, consultants, independent contractors and non-employee directors of the Company through a variety of incentive awards, including: stock options, SARs, restricted stock and units, PSUs, other stock-based awards and short-term cash awards. Stock option awards are granted with an exercise price equal to the fair market value of the shares underlying the stock options at the date of the grant, generally become exercisable over periods ranging from three to four years, and generally expire in ten years.
The following table summarizes stock awards (stock options and SARs) activity under the Plan and 2003 LTIP:
Number of Shares Under Stock AwardsWeighted Average Exercise Price per Share
Outstanding at December 31, 20215,576,490 $37.19 
Forfeited(450,161)$27.54 
Outstanding at March 31, 20225,126,329 $38.04 
Vested and expected to vest at March 31, 20225,077,897 $38.21 
Exercisable at March 31, 20224,831,333 $39.19 
As of March 31, 2022, stock awards outstanding, stock awards vested and expected to vest and stock awards exercisable had average remaining contractual terms of 4.7 years, 4.6 years and 4.5 years, respectively. Also, at March 31, 2022, stock awards outstanding, stock awards vested and expected to vest and stock awards exercisable had no aggregate intrinsic value.
A summary of the status of the Company’s nonvested restricted stock awards (restricted stock and restricted stock unit awards, including PSUs) as of March 31, 2022 and the changes during the three months ended March 31, 2022 are presented below:
Number of Restricted Stock AwardsWeighted Average Grant-Date Fair Value Per Share
Nonvested at December 31, 202116,858,128 $15.12 
Granted16,635,392 10.20 
Released(3,517,219)17.95 
Forfeited(229,241)13.99 
Nonvested at March 31, 202229,747,060 $12.04 
As of March 31, 2022, the Company had $272.7 million of total unrecognized compensation expense, net of estimated forfeitures, related to all of its stock-based awards, which we expect to recognize over the remaining weighted average vesting period of 2.0 years. The total intrinsic value of restricted stock units released during the three months ended March 31, 2022 and 2021 was $63.1 million and $30.8 million, respectively.
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VIATRIS INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued
5.Pensions and Other Postretirement Benefits
Defined Benefit Plans
The Company sponsors various defined benefit pension plans in several countries. Benefits provided generally depend on length of service, pay grade and remuneration levels. Employees in the U.S., Puerto Rico and certain international locations are also provided retirement benefits through defined contribution plans.
The Company also sponsors other postretirement benefit plans including plans that provide for postretirement supplemental medical coverage. Benefits from these plans are provided to employees and their spouses and dependents who meet various minimum age and service requirements. In addition, the Company sponsors other plans that provide for life insurance benefits and postretirement medical coverage for certain officers and management employees.
Net Periodic Benefit Cost
Components of net periodic benefit cost for the three months ended March 31, 2022 and 2021 were as follows:
Pension and Other Postretirement Benefits
Three Months Ended
March 31,
(In millions)20222021
Service cost$9.5 $10.8 
Interest cost10.4 8.5 
Expected return on plan assets(16.6)(16.5)
Amortization of prior service costs0.1 (0.1)
Recognized net actuarial losses 0.3 
Net periodic benefit cost$3.4 $3.0 
The Company is making the minimum mandatory contributions to its defined benefit pension plans in the U.S. and Puerto Rico for the 2022 plan year. The Company expects to make total benefit payments of approximately $118.0 million from pension and other postretirement benefit plans in 2022. The Company anticipates making contributions to pension and other postretirement benefit plans of approximately $52.0 million in 2022.
6.Balance Sheet Components
Selected balance sheet components consist of the following:
Cash and restricted cash
(In millions)March 31,
2022
December 31,
2021
March 31, 2021
Cash and cash equivalents$752.4 $701.2 $806.9 
Restricted cash, included in prepaid expenses and other current assets5.0 5.0 6.2 
Cash, cash equivalents and restricted cash$757.4 $706.2 $813.1 
Inventories
(In millions)March 31,
2022
December 31,
2021
Raw materials$868.1 $922.4 
Work in process767.5 993.3 
Finished goods2,161.7 2,062.0 
Inventories$3,797.3 $3,977.7 
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VIATRIS INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued
Prepaid expenses and other current assets
(In millions)March 31,
2022
December 31, 2021
Prepaid expenses$268.1 $256.7 
Available-for-sale fixed income securities36.6 38.2 
Fair value of financial instruments202.8 144.6 
Equity securities48.0 51.0 
Other current assets1,208.1 1,467.1 
Prepaid expenses and other current assets$1,763.6 $1,957.6 
Prepaid expenses consist primarily of prepaid rent, insurance and other individually insignificant items.
Property, plant and equipment, net
(In millions)March 31,
2022
December 31, 2021
Machinery and equipment$2,845.8 $3,054.0 
Buildings and improvements1,578.4 1,808.5 
Construction in progress541.8 588.7 
Land and improvements126.5 137.9 
Gross property, plant and equipment5,092.5 5,589.1 
Accumulated depreciation1,942.3 2,400.5 
Property, plant and equipment, net$3,150.2 $3,188.6 
Other assets
(In millions)March 31,
2022
December 31, 2021
Operating lease right-of-use assets$281.7 $290.8 
Other long-term assets774.3 879.9 
Other assets$1,056.0 $1,170.7 
Accounts payable
(In millions)March 31,
2022
December 31, 2021
Trade accounts payable$928.4 $1,056.1 
Other payables571.2 601.3 
Accounts payable$1,499.6 $1,657.4 
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VIATRIS INC. AND SUBSIDIARIES
Notes to Condensed Consolidated Financial Statements (Unaudited) - Continued
Other current liabilities
(In millions)March 31,
2022
December 31, 2021
Accrued sales allowances$1,095.8 $1,362.1 
Legal and professional accruals, including litigation accruals694.9 715.6 
Payroll and employee benefit liabilities567.1 741.9 
Contingent consideration86.2 66.7 
Accrued restructuring171.8 233.5 
Accrued interest228.8 86.6 
Equity method investments, clean energy investments4.3 10.9 
Fair value of financial instruments98.9 61.0 
Operating lease liability89.9