Inventory

9 Months Ended

Sep. 30, 2024

The components of inventory are summarized as follows:


(In millions)	As of September 30, 2024		As of December 31, 2023
Raw materials	$	368.9	$	426.9
Work in process	1,803.8		1,926.8
Finished goods	391.0		255.4
Total inventory	$	2,563.7	$	2,609.1

Balance Sheet Classification:
Inventory	$	2,469.2	$	2,527.4
Investments and other assets	94.5		81.7
Total inventory	$	2,563.7	$	2,609.1

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

We recorded approximately $1.3 billion of acquired inventory, which includes measurement period adjustments, related to SKYCLARYS as a result of our acquisition of Reata in September 2023. The fair value was determined based on the estimated selling price of the inventory, less the remaining manufacturing and selling costs and a normal profit margin on those manufacturing and selling efforts. This fair value step-up adjustment is being amortized to cost of sales within our condensed consolidated statements of income as the inventory is sold, which is expected to be sold over a period of approximately 4 years from the acquisition date. For the three and nine months ended September 30, 2024, amortization from the fair value step-up adjustment was approximately $50.9 million and $185.1 million, respectively. The three and nine months ended September 30, 2024, include approximately $2.5 million and $48.5 million, respectively, of inventory used for clinical purposes, which is reflected within research and development expense within our condensed consolidated statements of income. For additional information on our acquisition of Reata, please read Note 2, Acquisitions, to these condensed consolidated financial statements.