Leases

12 Months Ended

Dec. 31, 2025


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 twenty-two 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 less than one year to fifteen years.

In addition, we sublease certain real estate to third parties. Our sublease portfolio consists of operating leases, with remaining lease terms ranging from three years to four years.

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	2025		2024
Assets:
Operating lease assets	Operating lease assets	$	265.4	$	356.4

Liabilities
Current operating lease liabilities	Accrued expense and other	$	80.4	$	86.4
Non-current operating lease liabilities	Long-term operating lease liabilities	290.4		334.5
Total operating lease liabilities		$	370.8	$	420.9

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	2025		2024		2023
Operating lease cost	Research and development	$	0.9	$	2.4	$	2.0
	Selling, general and administrative	100.7		110.1		128.1
Variable lease cost	Research and development	0.1		0.4		0.5
	Selling, general and administrative	34.5		31.2		37.3
Sublease income	Selling, general and administrative	(9.6)		(14.8)		(23.5)
	Other (income) expense, net	(4.0)		(4.0)		(4.1)
Net lease cost		$	122.6	$	125.3	$	140.3

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 are expected to be as follows:


(In millions)	As of December 31, 2025
2026	$	94.1
2027	97.5
2028	56.4
2029	26.1
2030	23.1
Thereafter	148.3
Total lease payments	445.5
Less: interest	74.7
Present value of operating lease liabilities	$	370.8

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


	As of December 31,
	2025		2024
Weighted average remaining lease term in years	7.11		7.20
Weighted average discount rate	4.6	%	4.5	%

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)	2025		2024		2023
Cash paid for amounts included in the measurement of lease liabilities	$	110.7	$	115.8	$	116.4
Operating lease assets obtained in exchange for lease obligations	30.7		16.9		146.0

New Corporate Headquarters Lease

In March 2025 we entered into a lease agreement with MIT Investment Management Company and BioMed Realty for the lease of approximately 580,000 square feet of office and research and development space located at 75 Broadway, Cambridge, Massachusetts, which will be used as our new global corporate headquarters, as well as integrating our research and development and technical operations teams alongside our North American commercial organization. As part of a multi-year real estate consolidation plan that is expected to result in a reduction of approximately 40% of our real estate footprint in Massachusetts, this new lease is intended to replace two existing leases, both in Cambridge, Massachusetts, including our current corporate headquarters. We expect the initial lease term of approximately 15.5 years to commence on May 31, 2028. The estimated minimum lease payments as a result of the new lease total approximately $1.5 billion over the initial lease term. We have an option to extend the lease for three extension periods of five years each and one six-month short-term extension, at then market-based rates. We will account for this lease as a right-of-use asset and lease liability upon the lease commencement date.

For additional information on our accounting policies relating to leases, please read Note 1, Summary of Significant Accounting Policies - Leases, to these consolidated financial statements.

Reata Lease

As part of our acquisition of Reata, we assumed responsibility for a single-tenant, build-to-suit building of approximately 327,400 square feet of office and laboratory space located in Plano, Texas, with an initial lease term of 16 years. We recorded a lease liability of approximately $151.8 million, with a corresponding right-of-use asset of approximately $121.2 million. We are continuing to evaluate opportunities to sublease the property.

During the fourth quarter of 2025 we performed an impairment assessment for this right-of use asset. This assessment involved estimating undiscounted future cash flows, including potential sublease income and remaining lease obligations. Given the carrying value exceeded the estimated undiscounted cash flows, primarily as the result of lower expected sublease income, we determined fair value using market data for similar properties and a probability-adjusted discounted cash flow calculation using a discount rate of 5.0%. As a result of this impairment assessment, we recorded an impairment charge of approximately $52.9 million related to this Reata lease, which is included in impairment of ROU asset within our consolidated statements of income for the year ended December 31, 2025. This fair value measurement was based on significant inputs that are not observable in the market and thus represent a Level 3 fair value measurement.