Core Insights - Bausch Health Companies Inc. (BHC) reported mixed results for Q2 2025, with adjusted earnings per share of 90 cents missing the Zacks Consensus Estimate of 97 cents, while total revenues of $2.53 billion exceeded expectations, marking a 5% year-over-year increase [1][7] Revenue Breakdown - Salix segment revenues reached $627 million, up 12% year over year, driven by strong demand for Xifaxan, Trulance, and Relistor, surpassing the Zacks Consensus Estimate of $589 million [3][4] - International revenues totaled $278 million, a 1% increase year over year, but fell short of estimates, with organic growth also at 1% [5] - Solta Medical reported revenues of $128 million, up 25% year over year, driven by global volume expansion, although it missed the model estimate [8] - Diversified Products revenues decreased by 13% to $219 million, with declines in neurology, generics, and dermatology segments [9][10] - Bausch + Lomb revenues amounted to $1.3 billion, a 5% increase year over year, exceeding estimates and driven by growth in the vision care segment [10] Pipeline Development - BHC is reviewing pipeline candidate amiselimod for ulcerative colitis treatment and has submitted an application for Cabtreo, which was approved in Canada [11] - Phase III studies for rifaximin are ongoing, with top-line results expected by early 2026 [12] - The Clear and Brilliant Touch program is advancing with approvals in multiple countries, and the Fraxel FTX system was launched in the U.S. in April 2025 [13][14] Financial Guidance - BHC updated its 2025 revenue guidance to a range of $10-$10.25 billion, with Bausch + Lomb revenues projected between $5.05-$5.15 billion [15] Acquisition Activity - BHC announced plans to acquire DURECT Corporation for $63 million, with potential milestone payments of up to $350 million, focusing on larsucosterol for alcoholic hepatitis treatment [17][18][19]

Core Viewpoint - Bausch Health (BHC) reported quarterly earnings of $0.9 per share, missing the Zacks Consensus Estimate of $0.97 per share, representing an earnings surprise of -7.22% [1]. Financial Performance - The company posted revenues of $2.53 billion for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 2.42%, compared to year-ago revenues of $2.4 billion [2]. - Over the last four quarters, Bausch has surpassed consensus EPS estimates two times and topped consensus revenue estimates three times [2]. Stock Performance - Bausch shares have lost about 15.4% since the beginning of the year, while the S&P 500 has gained 8.3% [3]. - The current consensus EPS estimate for the coming quarter is $1.13 on $2.57 billion in revenues, and for the current fiscal year, it is $3.96 on $10 billion in revenues [7]. Industry Outlook - The Medical - Generic Drugs industry, to which Bausch belongs, is currently in the top 37% of over 250 Zacks industries, indicating a favorable outlook [8]. - Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact Bausch's stock performance [5]. Future Expectations - The estimate revisions trend for Bausch was favorable ahead of the earnings release, resulting in a Zacks Rank 2 (Buy) for the stock, suggesting it is expected to outperform the market in the near future [6]. - The upcoming earnings call will be crucial for understanding management's commentary on future earnings expectations [3].

PART I. FINANCIAL INFORMATION [Item 1. Condensed Consolidated Financial Statements (unaudited)](index=4&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20%28unaudited%29) Presents Bausch Health's unaudited condensed consolidated financial statements for Q2 2025, including core financial statements and detailed notes [Condensed Consolidated Balance Sheets](index=4&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Condensed Consolidated Balance Sheets (in millions) | | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $1,727 | $1,181 | | Trade receivables, net | $2,210 | $2,140 | | Inventories, net | $1,655 | $1,595 | | Total current assets | $6,514 | $5,774 | | Property, plant and equipment, net | $1,994 | $1,780 | | Intangible assets, net | $5,047 | $5,551 | | Goodwill | $11,298 | $11,087 | | Total assets | $27,266 | $26,523 | | **Liabilities** | | | | Current portion of long-term debt | $879 | $2,674 | | Total current liabilities | $4,975 | $6,752 | | Non-current portion of long-term debt | $20,859 | $18,942 | | Total liabilities | $27,119 | $26,845 | | **Equity (Deficit)** | | | | Total equity (deficit) | $147 | $(322) | - Total assets increased by **$743 million (2.8%)** from **$26,523 million** at **December 31, 2024**, to **$27,266 million** at **June 30, 2025**[15](index=15&type=chunk) - Total equity (deficit) improved significantly from a deficit of **$322 million** at **December 31, 2024**, to a positive **$147 million** at **June 30, 2025**[15](index=15&type=chunk) [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) Condensed Consolidated Statements of Operations (in millions, except per share amounts) | | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Revenues | $2,530 | $2,403 | $4,789 | $4,556 | | Operating income | $444 | $389 | $720 | $670 | | Income (loss) before income taxes | $140 | $48 | $93 | $(21) | | Net income (loss) attributable to Bausch Health Companies Inc. | $148 | $10 | $90 | $(54) | | Basic EPS | $0.40 | $0.03 | $0.24 | $(0.15) | | Diluted EPS | $0.40 | $0.03 | $0.24 | $(0.15) | - Revenues for the three months ended **June 30, 2025**, increased by **$127 million (5%)** to **$2,530 million** compared to **$2,403 million** in the prior year[17](index=17&type=chunk) - Net income attributable to Bausch Health Companies Inc. for the three months ended **June 30, 2025**, was **$148 million**, a significant increase from **$10 million** in the prior year period[17](index=17&type=chunk) [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20%28Loss%29) Condensed Consolidated Statements of Comprehensive Income (Loss) (in millions) | | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) | $128 | $(1) | $42 | $(78) | | Other comprehensive income (loss) | $225 | $(84) | $366 | $(118) | | Comprehensive income (loss) | $353 | $(85) | $408 | $(196) | | Comprehensive income (loss) attributable to Bausch Health Companies Inc. | $387 | $(80) | $479 | $(180) | - Comprehensive income attributable to Bausch Health Companies Inc. for the three months ended **June 30, 2025**, was **$387 million**, a significant improvement from a loss of **$80 million** in the prior year[18](index=18&type=chunk) - The positive change in comprehensive income was largely driven by a foreign currency translation adjustment of **$225 million** for the three months ended **June 30, 2025**, compared to a loss of **$84 million** in the prior year[18](index=18&type=chunk) [Condensed Consolidated Statements of Shareholders' Equity (Deficit)](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Shareholders%27%20Equity%20%28Deficit%29) Condensed Consolidated Statements of Shareholders' Equity (Deficit) (in millions) | | Balances, January 1, 2025 | Balances, June 30, 2025 | | :--- | :--- | :--- | | Common Shares | $10,490 | $10,510 | | Additional Paid-In Capital | $234 | $250 | | Accumulated Deficit | $(9,824) | $(9,734) | | Accumulated Other Comprehensive Loss | $(2,179) | $(1,790) | | Total Bausch Health Companies Inc. Shareholders' Deficit | $(1,279) | $(764) | | Noncontrolling Interest | $957 | $911 | | Total Equity (Deficit) | $(322) | $147 | - Total Bausch Health Companies Inc. shareholders' deficit improved from **$(1,279) million** at **January 1, 2025**, to **$(764) million** at **June 30, 2025**[21](index=21&type=chunk) - The improvement was primarily driven by net income of **$90 million** and other comprehensive income of **$389 million** for the six months ended **June 30, 2025**[21](index=21&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Condensed Consolidated Statements of Cash Flows (in millions) | | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $500 | $591 | | Net cash used in investing activities | $(230) | $(152) | | Net cash provided by (used in) financing activities | $212 | $(764) | | Effect of exchange rate changes on cash, cash equivalents and restricted cash | $60 | $(14) | | Net increase (decrease) in cash, cash equivalents and restricted cash | $542 | $(339) | | Cash, cash equivalents and restricted cash, end of period | $1,743 | $623 | - Net cash provided by operating activities decreased by **$91 million** to **$500 million** for the six months ended **June 30, 2025**, from **$591 million** in the prior year[24](index=24&type=chunk) - Net cash provided by financing activities was **$212 million** for the six months ended **June 30, 2025**, a significant turnaround from **$764 million** used in the prior year, primarily due to debt issuance and repayments[24](index=24&type=chunk) [Notes to the Condensed Consolidated Financial Statements](index=9&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) [Description of Business](index=9&type=section&id=DESCRIPTION%20OF%20BUSINESS) - Bausch Health is a global, diversified specialty pharmaceutical and medical device company with therapeutic areas including GI, hepatology, neurology, dermatology, and eye health (via **88%** ownership of Bausch + Lomb)[25](index=25&type=chunk) [Significant Accounting Policies](index=9&type=section&id=SIGNIFICANT%20ACCOUNTING%20POLICIES) - Financial statements are prepared in U.S. dollars under U.S. GAAP for interim reporting, consistent with annual policies[26](index=26&type=chunk) - The company is evaluating the impact of ASU **2024**-**03** (Expense Disaggregation, effective **2027**/**2028**) and ASU **2023**-**09** (Income Tax Disclosures, effective **2025**) on its financial statements[35](index=35&type=chunk)[36](index=36&type=chunk) [Revenue Recognition](index=10&type=section&id=REVENUE%20RECOGNITION) - Revenues are primarily from product sales (branded, generic, OTC, medical devices) in GI, hepatology, neurology, dermatology, and eye health[37](index=37&type=chunk) - Gross product sales are adjusted for variable consideration (discounts, allowances, returns, rebates, chargebacks, distribution fees), with provisions established based on best estimates and continually monitored[38](index=38&type=chunk)[39](index=39&type=chunk)[40](index=40&type=chunk) Variable Consideration Provisions Activity (Six Months Ended June 30, 2025 vs. 2024) | (in millions) | Discounts and Allowances 2025 | Discounts and Allowances 2024 | Returns 2025 | Returns 2024 | Rebates 2025 | Rebates 2024 | Chargebacks 2025 | Chargebacks 2024 | Distribution Fees 2025 | Distribution Fees 2024 | Total 2025 | Total 2024 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Reserve balances, January 1 | $170 | $191 | $372 | $380 | $1,421 | $1,108 | $189 | $216 | $85 | $44 | $2,237 | $1,939 | | Current period provisions | 348 | 325 | 68 | 89 | 2,072 | 1,802 | 887 | 1,002 | 160 | 147 | 3,535 | 3,365 | | Payments and credits | (356) | (339) | (74) | (79) | (2,087) | (1,607) | (912) | (1,039) | (160) | (108) | (3,589) | (3,172) | | Reserve balances, June 30 | $162 | $177 | $366 | $390 | $1,406 | $1,303 | $164 | $179 | $85 | $83 | $2,183 | $2,132 | [Licensing Agreements and Acquisitions](index=13&type=section&id=LICENSING%20AGREEMENTS%20AND%20ACQUISITIONS) - Company agreed to acquire DURECT Corporation for approximately **$63 million** upfront plus potential milestones up to **$350 million**, targeting Larsucosterol for alcohol-associated hepatitis[48](index=48&type=chunk) - Bausch + Lomb acquired Whitecap Biosciences for **$28 million** to expand its clinical-stage pipeline in glaucoma and geographic atrophy[49](index=49&type=chunk) - Bausch + Lomb acquired Elios Vision for **$99 million** cash and potential milestones, adding the ELIOS procedure for glaucoma treatment[50](index=50&type=chunk) [Restructuring, Integration and Separation Costs](index=14&type=section&id=RESTRUCTURING,%20INTEGRATION%20AND%20SEPARATION%20COSTS) - Restructuring and integration costs increased to **$32 million** for the six months ended **June 30, 2025**, from **$23 million** in **2024**[53](index=53&type=chunk) - Separation-related costs for the B+L Separation, including rebranding and facility relocation, were **$7 million** for the six months ended **June 30, 2025**, included in SG&A[55](index=55&type=chunk) [Fair Value Measurements](index=14&type=section&id=FAIR%20VALUE%20MEASUREMENTS) Assets and Liabilities Measured at Fair Value (June 30, 2025 vs. December 31, 2024) | (in millions) | June 30, 2025 Total | June 30, 2025 Level 1 | June 30, 2025 Level 2 | June 30, 2025 Level 3 | December 31, 2024 Total | December 31, 2024 Level 1 | December 31, 2024 Level 2 | December 31, 2024 Level 3 | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | **Assets:** | | | | | | | | | | Cash equivalents | $984 | $980 | $4 | $— | $567 | $557 | $10 | $— | | Restricted cash | $16 | $16 | $— | $— | $20 | $20 | $— | $— | | Cross-currency swaps | $6 | $— | $6 | $— | $6 | $— | $6 | $— | | Foreign currency exchange contracts | $4 | $— | $4 | $— | $10 | $— | $10 | $— | | **Liabilities:** | | | | | | | | | | Acquisition-related contingent consideration | $303 | $— | $— | $303 | $359 | $— | $— | $359 | | Cross-currency swaps | $168 | $— | $168 | $— | $40 | $— | $40 | $— | | Foreign currency exchange contracts | $8 | $— | $8 | $— | $5 | $— | $5 | $— | - Fair value of long-term debt was **$19,738 million** as of **June 30, 2025**, estimated using Level 2 quoted market prices[68](index=68&type=chunk) [Inventories](index=17&type=section&id=INVENTORIES) Inventories, Net (June 30, 2025 vs. December 31, 2024) | (in millions) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Raw materials | $538 | $540 | | Work in process | $96 | $108 | | Finished goods | $1,021 | $947 | | **Total** | **$1,655** | **$1,595** | [Intangible Assets and Goodwill](index=17&type=section&id=INTANGIBLE%20ASSETS%20AND%20GOODWILL) Intangible Assets, Net (June 30, 2025 vs. December 31, 2024) | (in millions) | June 30, 2025 Net | December 31, 2024 Net | | :--- | :--- | :--- | | Product brands | $2,962 | $3,420 | | Corporate brands | $252 | $287 | | Product rights/patents | $21 | $31 | | Partner relationships, technology and other | $14 | $15 | | Acquired in-process research and development | $100 | $100 | | B&L Trademark | $1,698 | $1,698 | | **Total Intangible Assets, Net** | **$5,047** | **$5,551** | Goodwill by Segment (June 30, 2025 vs. December 31, 2024) | (in millions) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Salix | $3,159 | $3,159 | | International | $892 | $792 | | Solta Medical | $115 | $115 | | Diversified | $1,726 | $1,759 | | Bausch + Lomb | $5,406 | $5,262 | | **Total Goodwill** | **$11,298** | **$11,087** | - No goodwill impairment was recorded for the six months ended **June 30, 2025**, as the fair value of Bausch + Lomb reporting units exceeded carrying value by over **25%** after quantitative testing[75](index=75&type=chunk) [Accrued and Other Current Liabilities](index=19&type=section&id=ACCRUED%20AND%20OTHER%20CURRENT%20LIABILITIES) Accrued and Other Current Liabilities (June 30, 2025 vs. December 31, 2024) | (in millions) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Product rebates | $1,362 | $1,385 | | Product returns | $366 | $372 | | Legal matters and related fees | $232 | $332 | | Employee compensation and benefit costs | $331 | $348 | | Interest | $279 | $217 | | Income taxes payable | $104 | $63 | | Other | $795 | $772 | | **Total** | **$3,469** | **$3,489** | [Financing Arrangements](index=20&type=section&id=FINANCING%20ARRANGEMENTS) Principal Amounts of Debt Obligations (June 30, 2025 vs. December 31, 2024) | (in millions) | June 30, 2025 Principal Amount | December 31, 2024 Principal Amount | | :--- | :--- | :--- | | Senior Secured Credit Facilities | $5,816 | $5,521 | | Senior Secured Notes | $8,126 | $5,606 | | B+L Senior Secured Notes | $2,196 | $1,400 | | Senior Unsecured Notes | $4,266 | $4,279 | | Other | $12 | $12 | | **Total long-term debt and other** | **$21,150** | **$20,480** | | Less: Current portion of long-term debt | $879 | $2,674 | | **Non-current portion of long-term debt and other** | **$20,859** | **$18,942** | - **April 2025** Refinancing Transactions extended approximately **$6,870 million** in aggregate debt maturities from **2025**-**2028** to **2030**-**2032**[277](index=277&type=chunk) - Company recognized a net gain of **$191 million** on extinguishment of debt from **April 2025** Refinancing Transactions and a loss of **$13 million** from B+L **June 2025** Refinancing Activity[149](index=149&type=chunk) [Share-Based Compensation](index=31&type=section&id=SHARE-BASED%20COMPENSATION) Share-Based Compensation Expenses (Six Months Ended June 30, 2025 vs. 2024) | (in millions) | 2025 | 2024 | | :--- | :--- | :--- | | Stock options | $8 | $6 | | RSUs | $81 | $63 | | **Total** | **$89** | **$69** | | Research and development expenses | $7 | $5 | | Selling, general and administrative expenses | $82 | $64 | | **Total** | **$89** | **$69** | - Approximately **24,832,000 common shares** were available for future grants under Bausch Health's **2014** Plan as of **June 30, 2025**[157](index=157&type=chunk) - Approximately **12,900,000 Bausch + Lomb common shares** were available for future grants under the B+L Plan as of **June 30, 2025**[162](index=162&type=chunk) [Accumulated Other Comprehensive Loss](index=33&type=section&id=ACCUMULATED%20OTHER%20COMPREHENSIVE%20LOSS) Accumulated Other Comprehensive Loss (June 30, 2025 vs. December 31, 2024) | (in millions) | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Foreign currency translation adjustment | $(1,773) | $(2,162) | | Pension adjustment, net of tax | $(17) | $(17) | | **Total** | **$(1,790)** | **$(2,179)** | [Research and Development](index=33&type=section&id=RESEARCH%20AND%20DEVELOPMENT) Research and Development Costs (Six Months Ended June 30, 2025 vs. 2024) | (in millions) | 2025 | 2024 | | :--- | :--- | :--- | | Product related research and development | $293 | $299 | | Quality assurance | $9 | $8 | | **Total** | **$302** | **$307** | [Other (Income) Expense, Net](index=33&type=section&id=OTHER%20%28INCOME%29%20EXPENSE,%20NET) Other (Income) Expense, Net (Six Months Ended June 30, 2025 vs. 2024) | (in millions) | 2025 | 2024 | | :--- | :--- | :--- | | Acquired in-process research and development costs | $29 | $3 | | Acquisition-related transaction costs | $3 | $1 | | Litigation and other matters, net of insurance recoveries and restitutions | $5 | $27 | | Acquisition-related contingent consideration | $(40) | $(6) | | Gain on sale of assets, net | $— | $(5) | | **Total** | **$(3)** | **$20** | - Acquired in-process R&D costs for **H1 2025** primarily relate to Bausch + Lomb's acquisition of Whitecap Biosciences[168](index=168&type=chunk) - Litigation and other matters for **H1 2025** include restitution received, while **H1 2024** primarily related to provisions for legal matters[170](index=170&type=chunk) [Income Taxes](index=34&type=section&id=INCOME%20TAXES) - Provision for income taxes for **H1 2025** was **$51 million**, including a **$51 million** net income tax benefit for discrete items (e.g., **$36 million** from IRS settlement for **2017** capital loss, **$19 million** from uncertain tax positions)[172](index=172&type=chunk) - Valuation allowance against deferred tax assets was approximately **$2,368 million** as of **June 30, 2025**, up from **$2,284 million** at **December 31, 2024**[174](index=174&type=chunk) - Unrecognized tax benefits totaled **$951 million** as of **June 30, 2025**, with **$401 million** potentially reducing the effective tax rate if recognized[175](index=175&type=chunk) [Earnings (Loss) Per Share](index=35&type=section&id=EARNINGS%20%28LOSS%29%20PER%20SHARE) Earnings (Loss) Per Share (Three and Six Months Ended June 30, 2025 vs. 2024) | (in millions, except per share amounts) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) attributable to Bausch Health Companies Inc. | $148 | $10 | $90 | $(54) | | Basic weighted-average common shares outstanding | 370.9 | 367.9 | 370.3 | 367.4 | | Diluted effect of stock options and RSUs | 2.2 | 2.3 | 3.2 | — | | Diluted weighted-average common shares outstanding | $373.1 | $370.2 | $373.5 | $367.4 | | Earnings (loss) per share attributable to Bausch Health Companies Inc. | | | | | | Basic | $0.40 | $0.03 | $0.24 | $(0.15) | | Diluted | $0.40 | $0.03 | $0.24 | $(0.15) | [Shareholder Rights Plan](index=35&type=section&id=SHAREHOLDER%20RIGHTS%20PLAN) - A Shareholder Rights Plan (SRP) was adopted on **April 14, 2025**, to ensure fair treatment in acquisition offers, triggered at **20%** ownership[188](index=188&type=chunk) - The SRP is subject to shareholder ratification by **October 7, 2025**; otherwise, it will terminate[188](index=188&type=chunk) [Legal Proceedings](index=36&type=section&id=LEGAL%20PROCEEDINGS) - Accrued current loss contingencies related to legal matters totaled **$232 million** as of **June 30, 2025**[190](index=190&type=chunk) - Ongoing Xifaxan Generics Litigation involves multiple generic manufacturers (Norwich, Amneal, Zydus, Cipla, Mylan, SABA, Alkem) challenging Xifaxan **550 mg** patents, with the Norwich First ANDA enjoined until **October 2029**[217](index=217&type=chunk)[219](index=219&type=chunk)[220](index=220&type=chunk) - Settlements were reached in the Carnegie Xifaxan Litigation and Mylan Trulance Paragraph IV Proceedings, leading to dismissals in **June** and **May 2025**, respectively[249](index=249&type=chunk)[250](index=250&type=chunk) [Segment Information](index=49&type=section&id=SEGMENT%20INFORMATION) - Company's reportable segments are Salix, International, Solta Medical, Diversified, and Bausch + Lomb[258](index=258&type=chunk) Segment Revenues (Three Months Ended June 30, 2025 vs. 2024) | (in millions) | 2025 Amount | 2025 Pct. | 2024 Amount | 2024 Pct. | Change Amount | Change Pct. | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Salix | $627 | 25 % | $558 | 23 % | $69 | 12 % | | International | $278 | 11 % | $276 | 11 % | $2 | 1 % | | Solta Medical | $128 | 5 % | $102 | 4 % | $26 | 25 % | | Diversified | $219 | 9 % | $251 | 10 % | $(32) | (13)% | | Bausch + Lomb | $1,278 | 50 % | $1,216 | 52 % | $62 | 5 % | | **Total revenues** | **$2,530** | **100 %** | **$2,403** | **100 %** | **$127** | **5 %** | Segment Profits (Three Months Ended June 30, 2025 vs. 2024) | (in millions) | 2025 Amount | 2025 Pct. | 2024 Amount | 2024 Pct. | Change Amount | Change Pct. | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Salix | $455 | 73 % | $377 | 68 % | $78 | 21 % | | International | $78 | 28 % | $86 | 31 % | $(8) | (9)% | | Solta Medical | $54 | 42 % | $47 | 46 % | $7 | 15 % | | Diversified | $139 | 63 % | $166 | 66 % | $(27) | (16)% | | Bausch + Lomb | $248 | 19 % | $274 | 23 % | $(26) | (9)% | | **Total segment profits** | **$974** | **38 %** | **$950** | **40 %** | **$24** | **3 %** | [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=52&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Analyzes Bausch Health's financial performance, liquidity, capital resources, business trends, and strategic initiatives [Introduction](index=52&type=section&id=INTRODUCTION) - The discussion covers financial condition and results of operations for the three and six months ended **June 30, 2025** and **2024**, prepared under U.S. GAAP and SEC rules[261](index=261&type=chunk)[262](index=262&type=chunk) [Overview](index=52&type=section&id=OVERVIEW) - Bausch Health is a global, diversified specialty pharmaceutical and medical device company with five reportable segments: Salix, International, Solta Medical, Diversified, and Bausch + Lomb[263](index=263&type=chunk)[264](index=264&type=chunk) - The company is pursuing the Bausch + Lomb separation to create two independent entities, aiming to maximize value and improve capital allocation, with Bausch Health retaining approximately **88%** ownership of Bausch + Lomb as of **July 23, 2025**[265](index=265&type=chunk)[266](index=266&type=chunk)[267](index=267&type=chunk) - Key strategic focuses include managing capital structure (e.g., **April 2025** Refinancing Transactions extending **$6.87 billion** in debt maturities), directing capital to core business growth (R&D, strategic acquisitions like DURECT, Whitecap Biosciences, Elios Vision), improving patient access, and divesting non-core assets[269](index=269&type=chunk)[277](index=277&type=chunk)[286](index=286&type=chunk) - Anticipates generic competition and loss of exclusivity (LOE) for branded products like Aplenzin (**2026**), Bryhali (**2026**), Relistor Subcutaneous (**2028**), Xifaxan (**2028**) in the U.S., and Jublia (**2028**) in Canada, actively managing risks through patent defense and pipeline development[329](index=329&type=chunk)[331](index=331&type=chunk)[332](index=332&type=chunk) [Financial Performance Highlights](index=61&type=section&id=FINANCIAL%20PERFORMANCE%20HIGHLIGHTS) Selected Financial Information (Three and Six Months Ended June 30, 2025 vs. 2024) | (in millions, except per share data) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Revenues | $2,530 | $2,403 | $127 | $4,789 | $4,556 | $233 | | Operating income | $444 | $389 | $55 | $720 | $670 | $50 | | Income (loss) before income taxes | $140 | $48 | $92 | $93 | $(21) | $114 | | Net income (loss) attributable to Bausch Health Companies Inc. | $148 | $10 | $138 | $90 | $(54) | $144 | | Earnings (loss) per share attributable to Bausch Health Companies Inc. | | | | | | | | Basic | $0.40 | $0.03 | $0.24 | $(0.15) | $0.39 | | Diluted | $0.40 | $0.03 | $0.37 | $0.24 | $(0.15) | $0.39 | - Three-month revenue increase of **$127 million (5%)** driven by higher volumes, improved net realized pricing, favorable foreign currencies, and acquisitions in Salix, Bausch + Lomb, and Solta Medical segments[336](index=336&type=chunk)[337](index=337&type=chunk) - Six-month revenue increase of **$233 million (5%)** driven by higher volumes, improved net realized pricing, and acquisitions in Salix, Bausch + Lomb, and Solta Medical segments, partially offset by unfavorable foreign currencies[340](index=340&type=chunk) [Results of Operations](index=63&type=section&id=RESULTS%20OF%20OPERATIONS) Consolidated Statements of Operations (Three and Six Months Ended June 30, 2025 vs. 2024) | (in millions) | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Change | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Revenues | $2,530 | $2,403 | $127 | $4,789 | $4,556 | $233 | | Cost of goods sold (excluding amortization and impairments of intangible assets) | $748 | $708 | $40 | $1,431 | $1,336 | $95 | | Selling, general and administrative | $894 | $832 | $62 | $1,761 | $1,626 | $135 | | Research and development | $159 | $156 | $3 | $302 | $307 | $(5) | | Amortization of intangible assets | $256 | $270 | $(14) | $512 | $544 | $(32) | | Asset impairments | $— | $5 | $(5) | $— | $6 | $(6) | | Restructuring, integration and separation costs | $31 | $12 | $19 | $32 | $24 | $8 | | Other (income) expense, net | $(18) | $20 | $(38) | $(3) | $20 | $(23) | | Operating income | $444 | $389 | $55 | $720 | $670 | $50 | | Interest income | $13 | $8 | $5 | $24 | $17 | $7 | | Interest expense | $(465) | $(350) | $(115) | $(795) | $(705) | $(90) | | Gain on extinguishment of debt | $178 | $12 | $166 | $178 | $23 | $155 | | Foreign exchange and other | $(30) | $(11) | $(19) | $(34) | $(26) | $(8) | | Income (loss) before income taxes | $140 | $48 | $92 | $93 | $(21) | $114 | | Provision for income taxes | $(12) | $(49) | $37 | $(51) | $(57) | $6 | | Net income (loss) | $128 | $(1) | $129 | $42 | $(78) | $120 | | Net loss attributable to noncontrolling interest | $20 | $11 | $9 | $48 | $24 | $24 | | Net income (loss) attributable to Bausch Health Companies Inc. | $148 | $10 | $138 | $90 | $(54) | $144 | - Revenues for **Q2 2025** increased by **$127 million (5%)** to **$2,530 million**, driven by higher volumes (**$77 million**), improved net realized pricing (**$21 million**), favorable foreign currencies (**$21 million**), and acquisitions (**$6 million**)[347](index=347&type=chunk) - SG&A expenses for **Q2 2025** increased by **$62 million (7%)** to **$894 million**, primarily due to higher selling, advertising, and promotion expenses for MIEBO and increased compensation costs[355](index=355&type=chunk) - Interest expense for **Q2 2025** increased by **$115 million (33%)** to **$465 million**, mainly due to write-offs of premiums, discounts, and deferred issuance costs from **April** and B+L **June 2025** Refinancing Activities, and higher effective interest rates[366](index=366&type=chunk) [Liquidity and Capital Resources](index=76&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) Cash Flows (Six Months Ended June 30, 2025 vs. 2024) | | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | Change | | :--- | :--- | :--- | :--- | | Net cash provided by operating activities | $500 | $591 | $(91) | | Net cash used in investing activities | $(230) | $(152) | $(78) | | Net cash provided by (used in) financing activities | $212 | $(764) | $976 | | Effect of exchange rate changes on cash, cash equivalents and restricted cash | $60 | $(14) | $74 | | Net increase (decrease) in cash, cash equivalents and restricted cash | $542 | $(339) | $881 | | Cash, cash equivalents and restricted cash, beginning of period | $1,201 | $962 | $239 | | **Cash, cash equivalents and restricted cash, end of period** | **$1,743** | **$623** | **$1,120** | - Net cash provided by operating activities decreased by **$91 million** to **$500 million** for **H1 2025**, primarily due to higher payments of accrued legal settlements[437](index=437&type=chunk)[438](index=438&type=chunk) - Net cash provided by financing activities was **$212 million** for **H1 2025**, a significant increase from **$764 million** used in **H1 2024**, driven by **$10,422 million** in long-term debt issuance (**April 2025** Refinancing and B+L **June 2025** Refinancing) offset by **$10,135 million** in repayments[441](index=441&type=chunk) - As of **June 30, 2025**, total debt obligations were **$21,150 million**. The company announced redemption of **$602 million** of **9.25%** Senior Unsecured Notes due **2026** and repayment of **$300 million** AR Credit Facility in **July 2025**[447](index=447&type=chunk) [Off-Balance Sheet Arrangements and Contractual Obligations](index=85&type=section&id=OFF-BALANCE%20SHEET%20ARRANGEMENTS%20AND%20CONTRACTUAL%20OBLIGATIONS) - No material off-balance sheet arrangements exist[508](index=508&type=chunk) - Primary cash requirements for remainder of **2025** (**July 1** - **Dec 31, 2025**): * Debt repayments and interest payments: ~**$29 million** maturities, ~**$919 million** interest payments (excluding announced **July 28, 2025** redemptions) * Capital expenditures: ~**$130 million** for property, plant, and equipment * Acquisition of DURECT: ~**$63 million** upfront cash payment * Contingent consideration and milestone payments: ~**$23 million**[514](index=514&type=chunk) - Future costs for the B+L Separation (legal, audit, advisory, rebranding, facility relocation) are expected to be material but cannot be reasonably estimated at this time[510](index=510&type=chunk) [Outstanding Share Data](index=87&type=section&id=OUTSTANDING%20SHARE%20DATA) - As of **July 25, 2025**, **369,790,319 common shares** were issued and outstanding[519](index=519&type=chunk) - Outstanding equity awards as of **July 25, 2025**: * Stock options: **5,808,087** * Time-based restricted share units: **11,715,684** * Performance-based restricted share units: **3,804,224** (maximum **7,415,196 common shares** issuable)[519](index=519&type=chunk) [Critical Accounting Policies and Estimates](index=87&type=section&id=CRITICAL%20ACCOUNTING%20POLICIES%20AND%20ESTIMATES) - No significant changes in critical accounting policies and estimates were identified during the three months ended **June 30, 2025**[520](index=520&type=chunk) [New Accounting Standards](index=87&type=section&id=NEW%20ACCOUNTING%20STANDARDS) - No new accounting standards were adopted during the six months ended **June 30, 2025**[521](index=521&type=chunk) [Forward-Looking Statements](index=87&type=section&id=FORWARD-LOOKING%20STATEMENTS) - Forward-looking statements cover business strategy, product pipeline, financial forecasts, debt management, B+L separation, and potential impacts of IRA and Xifaxan drug price negotiation[523](index=523&type=chunk) - Key risks include economic conditions, ongoing litigation (especially B+L IPO and Xifaxan Generics Litigation), regulatory scrutiny, generic competition, substantial debt, and geopolitical conflicts (Russia-Ukraine, Middle East)[525](index=525&type=chunk)[526](index=526&type=chunk)[527](index=527&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=94&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Details Bausch Health's exposure to market risks, including interest rate and inflation risks on products and debt - As of **June 30, 2025**, the company had **$14,238 million** in fixed-rate debt and **$6,912 million** in variable-rate debt[533](index=533&type=chunk) - A **100 basis-point** increase in interest rates would have an annualized pre-tax effect of approximately **$69 million** on earnings and cash flows[533](index=533&type=chunk) - Inflation risk exists due to price control restrictions on pharmaceutical products in several countries, limiting the ability to raise prices in anticipation of inflation[535](index=535&type=chunk) [Item 4. Controls and Procedures](index=95&type=section&id=Item%204.%20Controls%20and%20Procedures) Management confirmed the effectiveness of Bausch Health's disclosure controls and procedures as of June 30, 2025, and reported no material changes in internal control over financial reporting during the quarter - Disclosure controls and procedures were effective as of **June 30, 2025**, as evaluated by management, CEO, and CFO[536](index=536&type=chunk) - No material changes in internal control over financial reporting occurred during the three months ended **June 30, 2025**[537](index=537&type=chunk) PART II. OTHER INFORMATION [Item 1. Legal Proceedings](index=96&type=section&id=Item%201.%20Legal%20Proceedings) This section refers to Note 18 of the financial statements for detailed information on legal proceedings, indicating no new material updates beyond what is already disclosed there [Item 1A. Risk Factors](index=96&type=section&id=Item%201A.%20Risk%20Factors) No new material changes to the risk factors previously disclosed in the Annual Report on Form 10-K for the year ended December 31, 2024, were identified as of the date of this Form 10-Q [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=96&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company reported no unregistered sales of equity securities or use of proceeds from such sales during the three months ended June 30, 2025 - No sales of equity securities by the Company occurred during the three months ended **June 30, 2025**[541](index=541&type=chunk) [Item 3. Defaults Upon Senior Securities](index=96&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) There were no reported defaults upon senior securities during the reporting period - No defaults upon senior securities were reported[542](index=542&type=chunk) [Item 4. Mine Safety Disclosures](index=96&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This section indicates that there are no mine safety disclosures applicable to the company for the reporting period - No mine safety disclosures were reported[543](index=543&type=chunk) [Item 5. Other Information](index=96&type=section&id=Item%205.%20Other%20Information) No other material information was reported in this section for the current period - No other information was reported[544](index=544&type=chunk) [Item 6. Exhibits](index=97&type=section&id=Item%206.%20Exhibits) This section lists all documents filed as exhibits to the Form 10-Q, including various certifications, indentures for debt, credit agreements, and the Shareholder Rights Plan Agreement, many of which are incorporated by reference - Key exhibits include: * Certifications of CEO and CFO (**31.1**, **31.2**, **32.1**, **32.2**) * Indenture for **2032** Senior Secured Notes (**4.1**) * Shareholder Rights Plan Agreement (**4.3**) * Indenture for B+L **January 2031** Senior Secured Notes (**4.4**) * Credit Agreement for **2025** Senior Secured Credit Facilities (**10.1**) * Bausch Health Companies Inc. **2025** Employee Stock Purchase Plan (**10.2**) * Third Amendment to B+L Credit and Guaranty Agreement (**10.6**)[546](index=546&type=chunk)[547](index=547&type=chunk) [Signatures](index=98&type=section&id=Signatures) The report is officially signed by the Chief Executive Officer and Chief Financial Officer, affirming its submission to the Securities and Exchange Commission - Report signed by Thomas J. Appio (CEO) and Jean-Jacques Charhon (EVP, CFO) on **July 30, 2025**[549](index=549&type=chunk)

Financial Data and Key Metrics Changes - Revenue for the second quarter was $2,530,000,000, up 5% on a reported basis and 4% on an organic basis compared to the same period a year ago [20][21] - Adjusted EBITDA was $871,000,000, an increase of $45,000,000 or 5% year over year [21] - Adjusted operating cash flow was $442,000,000, reflecting strong operational performance [21] Business Line Data and Key Metrics Changes - Salix revenues were $627,000,000, an increase of 12% compared to the same period last year, driven by favorable net pricing and strong volume performance [23] - Solta revenues were $128,000,000, an increase of 25% on a reported basis and 26% on an organic basis, primarily fueled by South Korea [25] - The diversified segment revenues were $219,000,000, a decrease of 13% compared to the same period a year ago, impacted by one-time pricing adjustments in neurology and dermatology [27] Market Data and Key Metrics Changes - EMEA achieved 6% organic growth in the second quarter, marking its tenth consecutive quarter of organic growth [11] - Canada experienced double-digit growth driven by promoted products, with a 12% increase in the top line [24] - LATAM's performance was softer due to ongoing macroeconomic challenges and partial channel destocking [24] Company Strategy and Development Direction - The company is focused on unlocking value, growth, and optimizing its capital structure, with a commitment to R&D and business development [30][31] - The acquisition of Direct Corporation aims to enhance the development of treatments for alcohol hepatitis, showcasing the company's commitment to addressing unmet medical needs in hepatology [17][18] - The company continues to evaluate opportunities to maximize returns for stakeholders and improve its capital structure [7][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to execute strategic priorities and deliver value for stakeholders, despite a more uncertain macro environment [4][20] - The company reaffirmed its full-year 2025 guidance for revenue and adjusted EBITDA, indicating a positive outlook for the remainder of the year [5][30] Other Important Information - The company completed a $7,900,000,000 debt refinancing, extending maturities and improving its capital structure [7][28] - The company has settled nine more opt-out cases year to date, with 11 remaining, and received communication from the IRS that a significant legal matter has concluded without negative cash flow implications [19] Q&A Session Summary Question: Share buybacks and DTC efforts for XIFAXAN - Management confirmed that share buybacks are still a possibility but have been deprioritized in favor of reinvestment in the business [36][37] - The focus for DTC investments is currently on the OHE indication, with significant growth observed in both indications [38][39] Question: Rifaximin franchise and SSD trials - Management confirmed that lactulose background therapy is allowed in the SSD trials and emphasized the potential patient population for the SSD product [42][44] - The possibility of XIFAXAN being available over-the-counter has not been considered at this time [45] Question: XIFAXAN ROA headwinds and revenue discrepancies - Management discussed ongoing negotiations regarding XIFAXAN and the potential impact of IRA on pricing, emphasizing the importance of presenting their case [48][49] - Discrepancies between revenue growth and prescription growth for RELISTOR and TRULANCE were attributed to favorable gross-to-net adjustments [51] Question: Direct Corporation acquisition details - Management expressed enthusiasm about the Direct Corporation acquisition and its potential to address significant unmet needs in hepatology [53][54] Question: Rifaximin SSD differentiation and head-to-head trials - Management stated that the SSD formulation is different in dosage and action compared to existing formulations, and no head-to-head trials are planned at this time [58][59] Question: IRA negotiations and price points - Management acknowledged the ongoing negotiations and the potential for significant price cuts, while emphasizing their strategy to minimize the impact [62][66]

Financial Data and Key Metrics Changes - Revenue for the second quarter was $2,530 million, up 5% on a reported basis and 4% on an organic basis compared to the same period a year ago [20] - Adjusted EBITDA was $871 million, an increase of $45 million or 5% year over year [21] - Adjusted operating cash flow was $442 million, reflecting strong operational cash flow generation [21] Business Line Data and Key Metrics Changes - Salix revenues were $627 million, an increase of 12% compared to the same period last year, driven by favorable net pricing and strong volume performance [23] - Solta revenues were $128 million, an increase of 25% on a reported basis and 26% on an organic basis compared to the same period last year, primarily fueled by South Korea [26] - Diversified segment revenues were $219 million, a decrease of 13% compared to the same period a year ago, impacted by one-time pricing adjustments in 2024 [28] Market Data and Key Metrics Changes - EMEA achieved 6% organic growth in the second quarter, marking the region's tenth consecutive quarter of organic growth [11] - Canada experienced 12% growth driven by the promoted products portfolio [24] - LATAM's performance was softer due to ongoing macroeconomic challenges and partial channel destocking [25] Company Strategy and Development Direction - The company is focused on unlocking value, growth, and optimizing capital structure, with a commitment to R&D and business development [6][31] - A strategic partnership was announced with YunnV to launch probiotic-based products for acne-prone skin in Poland [13] - The company is evaluating opportunities to reduce the net cost of capital of its debt over the next couple of months [32] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to execute strategic priorities and deliver value for stakeholders [20][68] - The company reaffirmed its full-year 2025 guidance for revenue and adjusted EBITDA, expecting revenue between $4,950 million and $5,100 million [30] - Management acknowledged the uncertain macro environment but highlighted strong operational performance and growth opportunities [5][19] Other Important Information - The company completed a $7,900 million debt refinancing, extending maturities and improving capital structure [7] - The acquisition of Direct Corporation is expected to advance the development of a treatment for alcohol hepatitis, pending certain conditions [17][18] Q&A Session Summary Question: Share buybacks and DTC efforts with XIFAXAN - Management indicated that share buybacks are still under evaluation but have taken a back seat to reinvestment in the business [39] - The focus for DTC investments is currently on the OHE indication, with significant growth in patient starts [41] Question: Rifaximin franchise and SSD trials - Management confirmed that lactulose background therapy is allowed in the SSD trials and emphasized the opportunity for expansion in the patient population [46][48] Question: XIFAXAN potential ROA headwinds in 2027 - Management acknowledged ongoing negotiations regarding XIFAXAN and the potential for significant price cuts, while emphasizing efforts to minimize impact [51][63] Question: Direct Corporation acquisition details - Management expressed confidence in the Direct acquisition, highlighting the potential for addressing unmet medical needs in hepatology [55] Question: Rifaximin SSD differentiation and off-label use - Management stated that the SSD formulation is different and does not plan to run head-to-head trials at this time [60]

2Q 2025 Earnings July 30, 2025 forward-looking statements speak only as of the date hereof. Bausch Health undertakes no obligation to update any of these forward- looking statements to reflect events or circumstances after the date of this presentation or to reflect actual outcomes, unless required by law. The guidance in this presentation is only effective as of the date given and will not be updated or affirmed unless and until the Company publicly announces updated or affirmed guidance. Distribution or r ...

[Executive Summary & Highlights](index=1&type=section&id=Executive%20Summary%20%26%20Highlights) Bausch Health reported strong Q2 2025 results, achieving **5% revenue growth**, **$128 million GAAP Net Income**, and strategic debt repayment [Second Quarter 2025 Overview](index=1&type=section&id=Second%20Quarter%202025%20Overview) Bausch Health announced its second quarter 2025 financial results, reporting total consolidated revenues of $2.53 billion, a 5% increase year-over-year. The company achieved its ninth consecutive quarter of year-over-year growth in Revenue and Adjusted EBITDA for Bausch Health, excluding Bausch + Lomb, demonstrating consistent operational performance - Bausch Health achieved its ninth consecutive quarter of year-over-year growth in Revenue and Adjusted EBITDA for Bausch Health, excluding Bausch + Lomb[5](index=5&type=chunk) Second Quarter 2025 Consolidated Revenue Performance | Metric | Q2 2025 (Billions) | Q2 2024 (Billions) | Reported Change ($) | Reported Change (%) | Organic Change (%) | | :-------------------------------- | :------------------ | :------------------ | :------------------ | :------------------ | :----------------- | | Total Consolidated Revenues | $2.53 | $2.40 | $127 | 5% | 4% | [Key Financial and Strategic Highlights](index=1&type=section&id=Key%20Financial%20and%20Strategic%20Highlights) Key highlights for Q2 2025 include a 5% reported and 4% organic revenue growth, GAAP Net Income of $128 million, and Consolidated Adjusted EBITDA of $842 million, up 6%. Strategically, the company announced a $900 million debt repayment, an agreement to acquire DURECT Corporation, and reaffirmed its full-year 2025 guidance Second Quarter 2025 Key Financial Highlights | Metric | Q2 2025 (Millions) | YoY Change (%) | | :------------------------------------------------ | :----------------- | :------------- | | Consolidated Revenues (Reported) | $2,530 | 5% | | Consolidated Revenues (Organic) | $2,503 | 4% | | GAAP Net Income Attributable to Bausch Health | $148 | N/A | | Consolidated Adjusted EBITDA Attributable to BHC | $842 | 6% | - Announced upcoming repayment of approximately **$900 million of debt** using cash on hand after quarter-end[7](index=7&type=chunk) - Entered into an agreement to acquire DURECT Corporation in July, aiming to commercialize its main treatment for alcohol-induced hepatitis[7](index=7&type=chunk) - Reaffirming full-year 2025 Revenue, Adjusted EBITDA (non-GAAP), and Adjusted Cash Flow from Operations (non-GAAP) guidance[7](index=7&type=chunk) [Financial Performance - Second Quarter 2025](index=2&type=section&id=Financial%20Performance%20-%20Second%20Quarter%202025) Q2 2025 financial performance saw total revenues grow 5% to $2.53 billion, with strong segmental contributions, increased profitability, and a decrease in operating cash flow [Consolidated Revenue Performance](index=2&type=section&id=Consolidated%20Revenue%20Performance) Total Bausch Health revenues for Q2 2025 increased by 5% on a reported basis and 4% on an organic basis compared to Q2 2024, reaching $2.53 billion. Bausch Health (excluding Bausch + Lomb) also saw a 5% increase in both reported and organic revenues Total Bausch Health Revenues (Q2 2025 vs Q2 2024) | Metric | 2025 (Millions) | 2024 (Millions) | Reported Change ($) | Reported Change (%) | Organic Change (%) | | :--------------------------- | :-------------- | :-------------- | :------------------ | :------------------ | :----------------- | | Total Bausch Health Revenues | $2,530 | $2,403 | $127 | 5% | 4% | | Bausch Health (excl. B+L) | $1,252 | $1,187 | $65 | 5% | 5% | [Segmental Revenue Performance](index=2&type=section&id=Segmental%20Revenue%20Performance) Segmental revenues showed varied performance, with Salix and Solta Medical leading growth at 12% and 25% respectively, while the Diversified segment experienced a 13% decrease. Bausch + Lomb also contributed to overall growth with a 5% reported increase Segmental Revenue Performance (Q2 2025 vs Q2 2024) | Segment | 2025 (Millions) | 2024 (Millions) | Reported Change ($) | Reported Change (%) | Organic Change (%) | | :------------------ | :-------------- | :-------------- | :------------------ | :------------------ | :----------------- | | Salix | $627 | $558 | $69 | 12% | 12% | | International | $278 | $276 | $2 | 1% | 1% | | Solta Medical | $128 | $102 | $26 | 25% | 26% | | Diversified | ($32) | (13%) | (13%) | | Bausch + Lomb | $1,278 | $1,216 | $62 | 5% | 3% | [Salix Segment](index=2&type=section&id=Salix%20Segment) The Salix segment reported revenues of $627 million, a 12% increase from Q2 2024, driven primarily by Xifaxan® which saw 10% revenue growth - Salix segment revenues increased by **12% to $627 million**, with Xifaxan® being the primary driver with **10% growth**[9](index=9&type=chunk) [International Segment](index=2&type=section&id=International%20Segment) International segment revenues grew by 1% to $278 million, with organic growth also at 1%, led by strong performance in Canada and EMEA - International segment revenues increased by **1% to $278 million**, with organic growth of **1%** driven by Canada and EMEA[10](index=10&type=chunk) [Solta Medical Segment](index=2&type=section&id=Solta%20Medical%20Segment) Solta Medical segment revenues surged by 25% to $128 million, with organic growth reaching 26%, primarily fueled by growth in South Korea - Solta Medical segment revenues increased by **25% to $128 million**, with **26% organic growth** led by South Korea[10](index=10&type=chunk) [Diversified Segment](index=2&type=section&id=Diversified%20Segment) The Diversified segment experienced a 13% decrease in reported and organic revenues, falling to $219 million - Diversified segment revenues decreased by **13% to $219 million** on both a reported and organic basis[11](index=11&type=chunk) [Bausch + Lomb Segment](index=2&type=section&id=Bausch%20%2B%20Lomb%20Segment) Bausch + Lomb segment revenues increased by 5% on a reported basis to $1.28 billion, with organic growth at 3% - Bausch + Lomb segment revenues increased by **5% to $1.28 billion**, with **3% organic growth**[11](index=11&type=chunk) [Profitability Metrics](index=2&type=section&id=Profitability%20Metrics) Consolidated operating income increased by $55 million to $444 million. GAAP Net Income attributable to Bausch Health significantly rose to $148 million from $10 million in Q2 2024. Adjusted Net Income also saw a slight increase, and Adjusted EBITDA grew by $44 million to $842 million Key Profitability Metrics (Q2 2025 vs Q2 2024) | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | Change ($ Millions) | | :------------------------------------------------ | :----------------- | :----------------- | :------------------ | | Consolidated Operating Income | $444 | $389 | $55 | | Consolidated Net Income Attributable to BHC | $148 | $10 | $138 | | Consolidated Adjusted Net Income Attributable to BHC (non-GAAP) | $335 | $328 | $7 | | Consolidated GAAP EPS Attributable to BHC | $0.40 | $0.03 | N/A | | Consolidated Adjusted EBITDA Attributable to BHC (non-GAAP) | $842 | $798 | $44 | [Cash Flow and Balance Sheet](index=3&type=section&id=Cash%20Flow%20and%20Balance%20Sheet) Cash provided by operating activities decreased by 24% to $289 million in Q2 2025. As of June 30, 2025, the company held $1,727 million in cash and cash equivalents and maintained significant availability under its revolving credit facilities Cash Flow and Balance Sheet Highlights | Metric | Q2 2025 (Millions) | Q2 2024 (Millions) | Change (%) | | :------------------------------------------------ | :----------------- | :----------------- | :--------- | | Cash Provided by Operating Activities | $289 | $380 | (24%) | | Balance Sheet Item | As of June 30, 2025 (Millions) | | :------------------------------------------------ | :----------------------------- | | Consolidated Cash and Cash Equivalents | $1,727 | | Bausch Health (excl. B+L) Revolving Credit Facility Availability | ~$475 | | Bausch + Lomb Revolving Credit Facility Availability | ~$760 | | Bausch Health (excl. B+L) Accounts Receivable Credit Facility (drawn) | $300 | [Strategic Priorities & Outlook](index=3&type=section&id=Strategic%20Priorities%20%26%20Outlook) The company is focused on strategic execution, R&D advancements, and has increased its full-year 2025 consolidated revenue and Adjusted EBITDA guidance [Strategic Focus](index=4&type=section&id=Strategic%20Focus) Bausch Health is focused on executing strategic priorities to drive continued growth and unlock long-term shareholder value, including maximizing the value of its Bausch Health and Bausch + Lomb assets. The company delivered strong financial momentum in the first half of the year and successfully completed a major refinancing initiative - The Company remains

Core Viewpoint - Bausch Health Companies Inc. has agreed to acquire DURECT Corp, focusing on the development of larsucosterol, a novel therapeutic molecule for alcoholic hepatitis, which currently lacks FDA or EMA approved treatments [1][2][3]. Group 1: Acquisition Details - Bausch Health will pay $1.75 per share in an all-cash transaction, totaling approximately $63 million, with potential milestone payments of up to $350 million [3]. - The acquisition is expected to close in the third quarter of 2025 [6]. Group 2: Clinical Development - A registrational Phase 3 program is planned to evaluate the safety and efficacy of larsucosterol for severe alcoholic hepatitis, with a primary endpoint of 90-day survival [3][4]. - The trial will be randomized, double-blind, placebo-controlled, and will incorporate feedback from the FDA [4]. Group 3: Complementary Programs - The acquisition complements Bausch Health's ongoing RED-C clinical program, which assesses rifaximin SSD for delaying the onset of hepatic encephalopathy hospitalization and all-cause mortality [5]. - Patient enrollment in two global Phase 3 studies for the RED-C program is complete, with results expected in early 2026 [5]. Group 4: Financial Context - Bausch Health is addressing its $21 billion debt, with a third due by 2027, and previously considered selling Bausch + Lomb Corp as part of this strategy [6]. - At the time of publication, Bausch Health's stock was down 0.36% at $6.87, while DURECT's stock rose 238.34% to $1.87 [6].

Core Insights - Bausch Health (BHC) is identified as a unique case study in the pharmaceutical industry, with a global presence and registration in Canada [1] Company Overview - Bausch Health is recognized as a significant player in the global pharmaceutical market, indicating its broad operational scope and influence [1] Analyst Background - The analysis is conducted by an experienced investment professional with over six years in equity analysis across various sectors, emphasizing a strong foundation in financial reporting and market value identification [1]

Core Viewpoint - Bausch Health Companies Inc. (BHC) reported disappointing first-quarter 2025 results, with earnings and revenues missing expectations, leading to a 3.81% decline in share price [1][15]. Financial Performance - Adjusted earnings per share were 59 cents, below the Zacks Consensus Estimate of 83 cents and down from 60 cents in the same quarter last year [1]. - Total revenues reached $2.26 billion, a 5% year-over-year increase, but missed the Zacks Consensus Estimate by 0.54% [1]. - Excluding foreign exchange impacts, acquisitions, and divestitures, organic revenue growth was 6% [2]. Segment Performance - Salix segment revenues were $542 million, up 9% year over year, but missed estimates [4][5]. - International revenues totaled $262 million, down 1% year over year, missing estimates but showing 5% organic growth [6]. - Solta Medical reported revenues of $113 million, a 28% increase year over year, beating estimates [7]. - Bausch + Lomb revenues were $1.14 billion, up 3% year over year, but missed estimates [10]. Pipeline Development - The phase II study on amiselimod for ulcerative colitis has completed enrollment, with a phase III study protocol submitted to the FDA [11]. - Phase III studies on rifaximin for hepatic encephalopathy are ongoing, with top-line results expected by early 2026 [12]. - The Clear and Brilliant Touch program for skin rejuvenation is advancing with multiple international approvals [13]. Guidance Update - BHC expects 2025 revenues to be between $9.950 billion and $10.200 billion, slightly up from previous guidance [14]. Debt Situation - As of March 31, 2025, BHC's debt obligations were $21.5 billion, with a cash balance of $1.1 billion [15].