Inventory

12 Months Ended

Dec. 31, 2022


Note 6:			Inventory

The components of inventory are summarized as follows:


	As of December 31,
(In millions)	2022		2021
Raw materials	$	413.2	$	349.6
Work in process(1)	751.9		814.0
Finished goods	200.4		187.9
Total inventory	$	1,365.5	$	1,351.5

Balance Sheet Classification:
Inventory	$	1,344.4	$	1,351.5
Investments and other assets	21.1		—
Total inventory	$	1,365.5	$	1,351.5

(1) Work in process inventory as of December 31, 2022, includes approximately $89.8 million related to LEQEMBI.

Long-term inventory is included in investments and other assets in our consolidated balance sheets.

Inventory amounts written down as a result of excess, obsolescence or unmarketability are charged to cost of sales, and totaled $336.2 million, $167.6 million and $26.6 million for the years ended December 31, 2022, 2021 and 2020, respectively.

Inventory Write-Offs

In April 2022 the Centers for Medicare and Medicaid Services (CMS) released the final National Coverage Decision (NCD) for the class of anti-amyloid treatments in Alzheimer's disease, including ADUHELM. The final NCD confirmed coverage with evidence development, in which patients with Medicare can only access treatment if they are part of an approved clinical trial. We expect that this decision will reduce future demand for ADUHELM to a minimal level. During the first quarter of 2022 we wrote-off approximately $275.0 million of inventory related to ADUHELM, as a result of this CMS decision, which was recognized in cost of sales within our consolidated statements of income for the year ended December 31, 2022. We have recognized approximately $136.0 million related to Eisai's 45.0% share of these charges in collaboration profit (loss) sharing within our consolidated statements of income for the year ended December 31, 2022.

During the fourth quarter of 2021 we wrote-off approximately $120.0 million of inventory in excess of forecasted demand related to ADUHELM, which was recognized in cost of sales within our consolidated statements of income for the year ended December 31, 2021. We have recognized approximately $59.0 million related to Eisai's 45.0% share of these charges in collaboration profit (loss) sharing within our consolidated statements of income for the year ended December 31, 2021.

As of December 31, 2022, the carrying value of our ADUHELM inventory was immaterial. As of December 31, 2021, we had approximately $223.0 million of ADUHELM inventory. For additional information please read Note 19, Collaborative and Other Relationships, to these consolidated financial statements.