Restructuring

3 Months Ended

Mar. 31, 2022

Restructuring and Related Activities [Abstract]

2020 Restructuring Program

During the fourth quarter of 2020, Viatris announced a significant global restructuring program in order to achieve synergies and ensure that the organization is optimally structured and efficiently resourced to deliver sustainable value to patients, shareholders, customers, and other stakeholders. As part of the restructuring, the Company is optimizing its commercial capabilities and enabling functions, and closing, downsizing or divesting certain manufacturing facilities globally that are deemed to be no longer viable either due to surplus capacity, challenging market dynamics or a shift in its product portfolio toward more complex products.

For the committed restructuring actions, the Company expects to incur total pre-tax charges of up to approximately $1.4 billion. Such charges are expected to include up to approximately $450 million of non-cash charges mainly related to accelerated depreciation and asset impairment charges, including inventory write-offs. The remaining estimated cash costs of up to approximately $950 million are expected to be primarily related to severance and employee benefits expense, as well as other costs, including those related to contract terminations and other plant disposal costs.

Charges for restructuring and ongoing cost reduction initiatives are recorded in the period the Company commits to a restructuring or cost reduction plan, or executes specific actions contemplated by the plan and all criteria for liability recognition have been met.

The following table summarizes the restructuring charges and the reserve activity for the 2020 restructuring program from December 31, 2021 to March 31, 2022:


(In millions)	Employee Related Costs		Other Exit Costs		Total
Balance at December 31, 2021:	$	292.6	$	4.1	$	296.7
Charges (1)	7.3		9.5		16.8

Cash payment	(77.6)		(6.2)		(83.8)
Utilization	—		(4.2)		(4.2)
Foreign currency translation	(2.1)		(0.1)		(2.2)
Balance at March 31, 2022:	$	220.2	$	3.1	$	223.3

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(1) For the three months ended March 31, 2022, total restructuring charges in Developed Markets, Emerging Markets, Greater China, JANZ, Emerging Markets and Corporate/Other were approximately $12.7 million, $2.6 million, $1.3 million, $0.1 million, and $0.1 million, respectively.

At March 31, 2022 and December 31, 2021, accrued liabilities for restructuring and other cost reduction programs were primarily included in other current liabilities and other long-term obligations in the condensed consolidated balance sheets.