Leases

12 Months Ended

Dec. 31, 2022


Note 12:			Leases

We lease real estate, including laboratory and office space, and certain equipment.

Our leases have remaining lease terms ranging from less than one year to eight years. Certain leases include one or more options to renew, exercised at our sole discretion, with renewal terms that can extend the lease term from one year to six years.

In addition, we sublease certain real estate to third parties. Our sublease portfolio consists of operating leases, with remaining lease terms ranging from two years to six years. Our subleases do not include an option to renew as they are coterminous with our operating leases.

All of our leases qualify as operating leases. The following table summarizes the presentation in our consolidated balance sheets of our operating leases:


		As of December 31,
(In millions)	Balance sheet location	2022		2021
Assets:
Operating lease assets	Operating lease assets	$	403.9	$	375.4

Liabilities
Current operating lease liabilities	Accrued expense and other	$	97.2	$	89.1
Non-current operating lease liabilities	Long-term operating lease liabilities	333.0		330.4
Total operating lease liabilities		$	430.2	$	419.5

The following table summarizes the effect of lease costs in our consolidated statements of income:


		For the Years Ended December 31,
(In millions)	Income Statement Location	2022		2021		2020
Operating lease cost	Research and development	$	2.0	$	3.4	$	5.2
	Selling, general and administrative	95.9		95.9		93.1
Variable lease cost	Research and development	0.4		0.8		1.1
	Selling, general and administrative	25.4		25.7		21.1
Sublease income	Selling, general and administrative	(24.0)		(23.9)		(24.2)
	Other (income) expense, net	(4.1)		(4.0)		(3.9)
Net lease cost		$	95.6	$	97.9	$	92.4

Variable lease cost primarily related to operating expense, taxes and insurance associated with our operating leases. As these costs are generally variable in nature, they are not included in the measurement of the operating lease asset and related lease liability.

The minimum lease payments for the next five years and thereafter is expected to be as follows:


(In millions)	As of December 31, 2022
2023	$	111.0
2024	107.0
2025	80.5
2026	65.7
2027	69.5
Thereafter	36.6
Total lease payments	$	470.3
Less: interest	40.1
Present value of operating lease liabilities	$	430.2

The weighted average remaining lease term and weighted average discount rate of our operating leases are as follows:


	As of December 31,
	2022		2021
Weighted average remaining lease term in years	4.64		5.43
Weighted average discount rate	3.7	%	2.9	%

Supplemental disclosure of cash flow information related to our operating leases included in cash flow provided by operating activities in our consolidated statements of cash flow is as follows:


	As of December 31,
(In millions)	2022		2021		2020
Cash paid for amounts included in the measurement of lease liabilities	$	107.4	$	105.8	$	100.2
Operating lease assets obtained in exchange for lease obligations	108.3		18.1		59.0

125 Broadway Building Sale and Leaseback Transaction

In connection with the sale of our building at 125 Broadway, we simultaneously leased back the building for a term of approximately 5.5 years, which resulted in the recognition of approximately $168.2 million in new lease liabilities and right-of-use assets recorded within our consolidated balance sheets as of December 31, 2022. The sale and immediate leaseback of this building qualified for sale and leaseback treatment and is classified as an operating lease. For additional information on the sale of our building, please read Note 11, Property, Plant and Equipment, to these consolidated financial statements.

300 Binney Street Lease Modification

In September 2022 we entered into an agreement to partially terminate a portion of our lease located at 300 Binney Street, Cambridge MA, as well as to reduce the lease term for the majority of the remaining space. The agreement was driven by our 2022 efforts to reduce costs by consolidating real estate locations. The transaction was treated as a lease modification as of the effective date and resulted in the derecognition of right of use assets of approximately $47.4 million and lease liabilities of approximately $52.7 million, which resulted in a gain of approximately $5.3 million, which was recorded within restructuring charges in our consolidated statements of income for the year ended December 31, 2022.