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Fair Value Measurements | 6 Months Ended
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Jun. 30, 2025
Fair Value Disclosures [Abstract] |
Fair Value Measurements |
Note 8: | Fair Value Measurements
The tables below present information about our assets and liabilities that are regularly measured and carried at fair value and indicate the level within the fair value hierarchy of the valuation techniques we utilized to determine such fair value:
|  | Fair Value Measurements on a Recurring Basis
|  | As of June 30, 2025
(In millions) |  | Total |  | Quoted Prices in Active Markets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3)
Assets: |  |  |  |  |  |  |  |
Cash equivalents |  | $ | 2,234.9 |  |  | $ | — |  |  | $ | 2,234.9 |  |  | $ | — |
Marketable equity securities |  | 157.0 |  |  | 157.0 |  |  | — |  |  | — |
Other current assets: |  |  |  |  |  |  |  |
Derivative contracts |  | 31.7 |  |  | — |  |  | 31.7 |  |  | — |
Other non-current assets: |  |  |  |  |  |  |  |
Convertible note(1) |  | 30.0 |  |  | — |  |  | — |  |  | 30.0 |
Plan assets for deferred compensation |  | 50.1 |  |  | — |  |  | 50.1 |  |  | — |
Total |  | $ | 2,503.7 |  |  | $ | 157.0 |  |  | $ | 2,316.7 |  |  | $ | 30.0 |
Liabilities: |  |  |  |  |  |  |  |
Other current liabilities: |  |  |  |  |  |  |  |
Derivative contracts |  | $ | 123.7 |  |  | $ | — |  |  | $ | 123.7 |  |  | $ | — |
Contingent consideration obligations |  | 297.2 |  |  | — |  |  | — |  |  | 297.2 |
Other non-current liabilities: |  |  |  |  |  |  |  |
Derivative contracts |  | 26.8 |  |  | — |  |  | 26.8 |  |  | — |
Contingent consideration obligations |  | 237.7 |  |  | — |  |  | — |  |  | 237.7 |
Total |  | $ | 685.4 |  |  | $ | — |  |  | $ | 150.5 |  |  | $ | 534.9 |
(1) As part of our strategic research arrangement with City Therapeutics we invested in a convertible note, for which we elected the fair value option. For additional information on the arrangement with City Therapeutics, please read Note 19, Collaborative and Other Relationships, to these condensed consolidated financial statements.
|  | Fair Value Measurements on a Recurring Basis
|  | As of December 31, 2024
(In millions) |  | Total |  | Quoted Prices in Active Markets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3)
Assets: |  |  |  |  |  |  |  |
Cash equivalents |  | $ | 1,664.9 |  |  | $ | — |  |  | $ | 1,664.9 |  |  | $ | — |
Marketable equity securities |  | 179.7 |  |  | 179.7 |  |  | — |  |  | — |
Other current assets: |  |  |  |  |  |  |  |
Derivative contracts |  | 62.5 |  |  | — |  |  | 62.5 |  |  | — |
Other non-current assets: |  |  |  |  |  |  |  |
Plan assets for deferred compensation |  | 42.8 |  |  | — |  |  | 42.8 |  |  | — |
Total |  | $ | 1,949.9 |  |  | $ | 179.7 |  |  | $ | 1,770.2 |  |  | $ | — |
Liabilities: |  |  |  |  |  |  |  |
Other current liabilities: |  |  |  |  |  |  |  |
Derivative contracts |  | $ | 11.7 |  |  | $ | — |  |  | $ | 11.7 |  |  | $ | — |
Contingent consideration obligations |  | 291.2 |  |  | — |  |  | — |  |  | 291.2 |
Other non-current liabilities: |  |  |  |  |  |  |  |
Contingent consideration obligations |  | 221.6 |  |  | — |  |  | — |  |  | 221.6 |
Total |  | $ | 524.5 |  |  | $ | — |  |  | $ | 11.7 |  |  | $ | 512.8 |
Our marketable equity securities represent investments in publicly traded equity securities. Our ability to liquidate our investment in Denali may be limited by the size of our interest, the volume of market-related activity, our concentrated level of ownership and potential restrictions resulting from our status as a collaborator. Therefore, we may realize significantly less than the current value of such investments. In June 2025 Sage announced it entered into a definitive agreement for Supernus Pharmaceuticals, Inc. to acquire Sage, with the transaction expected to close in the third quarter of 2025. As set forth in the amended Schedule 13D we filed with the SEC on July 30, 2025, we have disposed of all of our shares of Sage common stock in a block trade. For additional information on our investments in Denali and Sage common stock, please read Note 19, Collaborative and Other Relationships, to our consolidated financial statements included in our 2024 Form 10-K. There have been no material impairments of our assets measured and carried at fair value as of June 30, 2025 and December 31, 2024. In addition, there have been no changes to our valuation techniques as of June 30, 2025 and December 31, 2024. For a description of our validation procedures related to prices provided by third-party pricing services and our option pricing valuation model, please read Note 1, Summary of Significant Accounting Policies - Fair Value Measurements, to our consolidated financial statements included in our 2024 Form 10-K. Level 3 Assets and Liabilities Held at Fair Value The following table presents quantitative information, as of the dates indicated, about the valuation techniques and significant unobservable inputs used in the valuation of our Level 3 financial assets and liabilities measured at fair value on a recurring basis:
|  | Quantitative Information about Level 3 Fair Value Measurements
|  | As of June 30, 2025
(In millions) |  | Fair Value |  | Valuation Technique |  | Significant Unobservable Input(s) |  | Range |  | Weighted Average
Liabilities: |  |  |  |  |  |  |  |  |  |
Contingent consideration obligations |  | $ | 534.9 |  |  | Discounted cash flow |  | Discount rate |  | 5.6% - 5.7% |  | 5.7 | %
|  |  |  |  |  | Expected timing of achievement of development milestones |  | 2025 - 2030 |  | — |
|  | Quantitative Information about Level 3 Fair Value Measurements
|  | As of December 31, 2024
(In millions) |  | Fair Value |  | Valuation Technique |  | Significant Unobservable Input(s) |  | Range |  | Weighted Average
Liabilities: |  |  |  |  |  |  |  |  |  |
Contingent consideration obligations |  | $ | 512.8 |  |  | Discounted cash flow |  | Discount rate |  | 6.2% - 6.3% |  | 6.2 | %
|  |  |  |  |  | Expected timing of achievement of development milestones |  | 2025 - 2030 |  | — |
The weighted average discount rates were calculated based on the relative fair values of each distinct contingent consideration obligation related to our acquisition of HI-Bio in July 2024. In addition, we apply various probabilities of technological and regulatory success to the valuation models to estimate the fair values of these contingent consideration obligations, which ranged from approximately 70.0% to near certain probability as of June 30, 2025 and December 31, 2024. There were no tr ansfers of assets or liabilities into or out of Level 3 as of June 30, 2025 and December 31, 2024. Contingent Consideration Obligations In connection with our acquisition of HI-Bio in July 2024 we agreed to make additional payments based upon the achievement of certain milestone events. The following table provides a roll forward of the fair value of our contingent consideration obligations, which were classified as Level 3 measurements:
(In millions) |  | For the Three Months Ended June 30, 2025 |  |  |  | For the Six Months Ended June 30, 2025 |  |
Fair value, beginning of period |  | $ | 522.4 |  |  |  |  | $ | 512.8 |  |  |
Changes in fair value |  | 13.2 |  |  |  |  | 22.8 |  |  |
Payments |  | (0.7) |  |  |  |  | (0.7) |  |  |
Fair value, end of period |  | $ | 534.9 |  |  |  |  | $ | 534.9 |  |  |
Changes in the fair value of our contingent consideration obligations are recorded in (gain) loss on fair value remeasurement of contingent consideration in our condensed consolidated statements of income. The fair values of the contingent consideration liabilities were based on a probability-adjusted discounted cash flow calculation using Level 3 fair value measurements and inputs. For additional information on the valuation techniques and inputs utilized in the valuation of our financial assets and liabilities, please read Note 1, Summary of Significant Accounting Policies, to our consolidated financial statements included in our 2024 Form 10-K. As of June 30, 2025 and December 31, 2024, approximately $297.2 million and $291.2 million, respectively, of the fair value of the total contingent consideration obligations were classified as short-term and reflected as a component of accrued expense and other with the remaining $237.7 million and $221.6 million, respectively, reflected as a component of other long-term liabilities in our condensed consolidated balance sheets. F or the three and six months ended June 30, 2025, changes in the fair value of our contingent consideration obligations were primarily due to the passage of time. During the second quarter of 2025 the first milestone related to the fourth patient dosed in a phase 3 clinical trial of felzartamab for AMR was achieved, resulting in a $150.0 million milestone payment made to the former shareholders of HI-Bio, which was substantially paid in July 2025. Financial Instruments Not Carried at Fair Value Other Financial Instruments Due to the short-term nature of certain financial instruments, the carrying value reflected in our condensed consolidated balance sheets for current accounts receivable, due from anti-CD20 therapeutic programs, other current assets, accounts payable and accrued expense and other, approximates fair value. Debt Instruments The fair and carrying values of our debt instruments, which are Level 2 liabilities, are summarized as follows:
|  | As of June 30, 2025 |  | As of December 31, 2024
(In millions) |  | Fair Value |  | Carrying Value |  | Fair Value |  | Carrying Value
Current portion: |  |  |  |  |  |  |  |
4.050% Senior Notes due September 15, 2025(1) |  | $ | — |  |  | $ | — |  |  | $ | 1,741.0 |  |  | $ | 1,748.6 |
Current portion of notes payable |  | — |  |  | — |  |  | 1,741.0 |  |  | 1,748.6 |
Non-current portion: |  |  |  |  |  |  |  |
2.250% Senior Notes due May 1, 2030 |  | 1,351.1 |  |  | 1,495.2 |  |  | 1,295.6 |  |  | 1,494.7 |
5.050% Senior Notes due January 15, 2031(1) |  | 407.1 |  |  | 397.8 |  |  | — |  |  | — |
5.750% Senior Notes due May 15, 2035(1) |  | 668.7 |  |  | 645.5 |  |  | — |  |  | — |
5.200% Senior Notes due September 15, 2045 |  | 1,007.1 |  |  | 1,101.3 |  |  | 1,008.0 |  |  | 1,101.1 |
3.150% Senior Notes due May 1, 2050 |  | 946.0 |  |  | 1,475.3 |  |  | 943.7 |  |  | 1,475.0 |
3.250% Senior Notes due February 15, 2051 |  | 450.4 |  |  | 478.3 |  |  | 448.9 |  |  | 476.4 |
6.450% Senior Notes due May 15, 2055(1) |  | 721.7 |  |  | 690.3 |  |  | — |  |  | — |
Non-current portion of notes payable |  | 5,552.1 |  |  | 6,283.7 |  |  | 3,696.2 |  |  | 4,547.2 |
Total notes payable |  | $ | 5,552.1 |  |  | $ | 6,283.7 |  |  | $ | 5,437.2 |  |  | $ | 6,295.8 |
(1) In May 2025 we issued our 2025 Senior Notes for an aggregate principal amount of $1.75 billion. In June 2025 we used the net proceeds from the sale of our 2025 Senior Notes to redeem in full our 4.050% Senior Notes due September 15, 2025, prior to maturity. For additional information, please read Note 13, Indebtedness, to these condensed consolidated financial statements. The fair values of each of our series of Senior Notes were determined through market, observable and corroborated sources. The changes in the fair values of our Senior Notes as of June 30, 2025, compared to December 31, 2024, are primarily related to decreases in U.S. treasury yields, partially offset by increases in credit spreads used to value our Senior Notes since December 31, 2024. For additional information related to our Senior Notes, please read Note 13, Indebtedness, to our consolidated financial statements included in our 2024 Form 10-K.

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- Definition The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (bbb)(1) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 2: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 107 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-107 Reference 3: http://www.xbrl.org/2003/role/exampleRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 55 -Paragraph 100 -Publisher FASB -URI https://asc.fasb.org/1943274/2147482078/820-10-55-100 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (c)(3) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2E -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2E Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (f) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6A -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6A Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 2 -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-2 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 940 -SubTopic 820 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478119/940-820-50-1 + Details
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