Alkermes plc. 10-K

Item 9A. Controls and Procedures Disclosure Controls and Procedures and Internal Control Over Financial Reporting Controls and Procedures Our management has evaluated, with the participation of our principal executive officer and principal financial officer, the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act), as of December 31, 2024. Based upon that evaluation, our principal executive officer and principal financial officer concluded that, as of the end of the period covered by this report, our disclosure controls and procedures were effective to provide reasonable assurance that (a) the information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and (b) such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. In designing and evaluating our disclosure controls and procedures, our management recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and our management necessarily was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Changes in Internal Control over Financial Reporting There were no changes in our internal control over financial reporting during the quarter ended December 31, 2024 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Management’s Annual Report on Internal Control over Financial Reporting Our management is responsible for establishing and maintaining adequate internal control over our financial reporting as defined in Rules 13a-15(f) and 15d-15(f). Internal control over financial reporting is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act as a process designed by, or under the supervision of, the issuer’s principal executive and principal financial officers, or persons performing similar functions, and effected by the issuer’s board of directors, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP and includes those policies and procedures that: • pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect our transactions and dispositions of the assets of the issuer; 68 • provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures of the issuer are being made only in accordance with authorizations of management and directors of the issuer; and • provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the issuer’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Projections of any evaluation of effectiveness for future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Our management assessed the effectiveness of our internal control over financial reporting as of December 31, 2024. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”) in its 2013 Internal Control—Integrated Framework. Based on this assessment, our management has concluded that, as of December 31, 2024, our internal control over financial reporting was effective. The effectiveness of our internal control over financial reporting as of December 31, 2024 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report, which is included in this Annual Report, beginning on page F-1. Item 9B. Other Information Trading Plans During the three months ended December 31, 2024, no officer (as defined in Rule 16a-1(f) under the Exchange Act) or director of the Company adopted , modified or terminated a contract, instruction or written plan for the purchase or sale of securities of the Company that were intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act or a trading plan not intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) under the Exchange Act. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections Not applicable. 69 PART III Item 10. Directors, Executive Of ficers and Corporate Governance The information required by this item is incorporated herein by reference to our definitive proxy statement for our 2025 annual general meeting of shareholders. We expect this information will be provided under sections of the proxy statement entitled “Proposal 1—Election of Directors,” “The Role of the Board and Its Committees,” “Executive Officers,” “Other Corporate Governance Matters” and “Board Nominations, Evaluations and Refreshment” and, if required, “Delinquent Section 16(a) Reports”. Item 11. Executi ve Compensation The information required by this item (excluding, for clarity, the information required by Item 402(v) of Regulation S-K) is incorporated herein by reference to our definitive proxy statement for our 2025 annual general meeting of shareholders. We expect this information will be provided under sections of the proxy statement entitled “The Role of the Board and Its Committees,” “Director Compensation,” “Executive Compensation—Compensation Discussion and Analysis,” “Executive Compensation Tables,” “Additional Compensation Information,” “Compensation Committee Report” and “Pay Ratio”. Item 12. Security Ownership of Certa in Beneficial Owners and Management and Related Stockholder Matters The information required by this item is incorporated herein by reference to our definitive proxy statement for our 2025 annual general meeting of shareholders. We expect this information will be provided under sections of the proxy statement entitled “Ownership of the Company’s Ordinary Shares” and “Equity Compensation Plan Information”. Item 13. Certain Relationships and Relate d Transactions, and Director Independence The information required by this item is incorporated herein by reference to our definitive proxy statement for our 2025 annual general meeting of shareholders. We expect this information will be provided under sections of the proxy statement entitled “Certain Relationships and Related Party Transactions” and “The Board of Directors”. Item 14. Principal Accou nting Fees and Services The information required by this item is incorporated herein by reference to our definitive proxy statement for our 2025 annual general meeting of shareholders. We expect this information will be provided under a section of the proxy statement entitled “Audit Fees”. 70 PART IV Item 15. Exhibits and Fina ncial Statement Schedules (a)(1) Consolidated Financial Statements—The consolidated financial statements of Alkermes plc, as required by this item, are submitted in a separate section beginning on page F-1 of this Annual Report, as follows: Financial Statement Page Number Report of Independent Registered Public Accounting Firm (PCAOB ID: 238 ) F- 1 Consolidated Balance Sheets F- 3 Consolidated Statements of Operations and Comprehensive Income (Loss) F- 4 Consolidated Statements of Shareholders’ Equity F- 5 Consolidated Statements of Cash Flows F- 6 Notes to the Consolidated Financial Statements F- 7 (2) Financial Statement Schedules—All schedules have been omitted because the absence of conditions under which they are required or because the required information is included in the consolidated financial statements or notes thereto. (3) The exhibits listed in the below Exhibit Index are filed or furnished as part of this Annual Report or are incorporated into this Annual Report by reference. EXHIBIT INDEX Incorporated by reference herein Exhibit No. Description of Exhibit Form Date 2.2 ** § Agreement and Plan of Merger, dated November 14, 2019 by and among Alkermes, Inc., Thinker Merger Sub, Inc., Alkermes plc, Rodin Therapeutics, Inc., and Shareholder Representative Services LLC, as Company Equityholder Representative. Exhibit 2.1 to the Alkermes plc Current Report on Form 8-K (File No. 001-35299) November 25, 2019 2.3 § Separation Agreement, dated as of November 13, 2023, by and between Alkermes plc and Mural Oncology plc. Exhibit 2.1 to the Alkermes plc Current Report on Form 8-K (File No. 001-35299) November 15, 2023 3.1 Memorandum and Articles of Association of Alkermes plc. Exhibit 3.1 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) May 1, 2024 4.1 # Description of Securities. 10.1 Lease between Alkermes, Inc. and PDM Unit 850, LLC, dated as of April 22, 2009. Exhibit 10.5 to the Alkermes, Inc. Annual Report on Form 10-K (File No. 001-14131) May 28, 2009 10.1A First Amendment to Lease between Alkermes, Inc. and PDM Unit 850, LLC, dated as of June 18, 2009. Exhibit 10.2 to the Alkermes, Inc. Quarterly Report on Form 10-Q (File No. 001-14131) August 6, 2009 10.1B Second Amendment to Lease between Alkermes, Inc. and PDM Unit 850, LLC, dated as of November 12, 2013. Exhibit 10.74 to the Alkermes plc Transition Report on Form 10-KT (File No. 001-35299) February 27, 2014 10.1C Third Amendment to Lease between Alkermes, Inc. and PDM 850 Unit, LLC, dated as of May 15, 2014. Exhibit 10.2 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) July 31, 2014 10.1D Fourth Amendment to Lease between Alkermes, Inc. and GI TC 850 Winter Street, LLC, dated as of December 30, 2014. Exhibit 10.7 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) July 30, 2015 10.1E Fifth Amendment to Lease between Alkermes, Inc. and GI TC 850 Winter Street, LLC, dated as of October 31, 2018. Exhibit 10.1.5 to the Alkermes plc Annual Report on Form 10-K (File No. 001-35299) February 15, 2019 10.1F Sixth Amendment to Lease between Alkermes, Inc. and GI TC 850 Winter Street, LLC, dated as of July 24, 2020. Exhibit 10.1 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) October 29, 2020 71 Incorporated by reference herein Exhibit No. Description of Exhibit Form Date 10.2 License Agreement, dated as of February 13, 1996, between Medisorb Technologies International L.P. and Janssen Pharmaceutica Inc. (United States) (assigned to Alkermes, Inc. in July 2006). Exhibit 10.2 to the Alkermes plc Annual Report on Form 10-K (File No. 001-35299) February 25, 2016 10.2A * Third Amendment to Development Agreement, Second Amendment to Manufacturing and Supply Agreement and First Amendment to License Agreements by and between Janssen Pharmaceutica International, Janssen Pharmaceutica Inc. and Alkermes Controlled Therapeutics Inc. II, dated April 1, 2000 (assigned to Alkermes, Inc. in July 2006). Exhibit 10.5 to the Alkermes, Inc. Quarterly Report on Form 10-Q (File No. 001-14131) February 8, 2005 10.2B * Second Amendment, dated as of August 16, 2012, to the License Agreement, dated as of February 13, 1996, as amended, by and between Alkermes, Inc. and Janssen Pharmaceutica Inc. and the License Agreement, dated as of February 21, 1996, as amended, by and between Alkermes, Inc. and JPI Pharmaceutica International, and the Fifth Amendment, dated as of August 16, 2012, to the Manufacturing and Supply Agreement, dated as of August 6, 1997, as amended, by and between Alkermes, Inc., Janssen Pharmaceutica Inc. and JPI Pharmaceutica International. Exhibit 10.3 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) November 1, 2012 10.3 License Agreement, dated as of February 21, 1996, between Medisorb Technologies International L.P. and Janssen Pharmaceutica International (worldwide except United States) (assigned to Alkermes, Inc. in July 2006). Exhibit 10.3 to the Alkermes plc Annual Report on Form 10-K (File No. 001-35299) February 25, 2016 10.4 Manufacturing and Supply Agreement, dated August 6, 1997, by and among JPI Pharmaceutica International, Janssen Pharmaceutica, Inc. and Alkermes Controlled Therapeutics Inc. II (assigned to Alkermes, Inc. in July 2006). Exhibit 10.4 to the Alkermes plc Annual Report on Form 10-K (File No. 001-35299) February 25, 2016 10.4A * Fourth Amendment to Development Agreement and First Amendment to Manufacturing and Supply Agreement by and between Janssen Pharmaceutica International, Janssen Pharmaceutica Products, L.P. and Alkermes Controlled Therapeutics Inc. II, dated December 20, 2000 (assigned to Alkermes, Inc. in July 2006). Exhibit 10.4 to the Alkermes, Inc. Quarterly Report on Form 10-Q (File No. 001-14131) February 8, 2005 10.4B Addendum to the Manufacturing and Supply Agreement by and among JPI Pharmaceutica International, Janssen Pharmaceutica Inc. and Alkermes Controlled Therapeutics Inc. II, dated August 1, 2001. Exhibit 10.4.2 to the Alkermes plc Annual Report on Form 10-K (File No. 001-35299) February 25, 2016 10.4C Letter Agreement and Exhibits to Manufacturing and Supply Agreement, dated February 1, 2002, by and among JPI Pharmaceutica International, Janssen Pharmaceutica Inc. and Alkermes Controlled Therapeutics Inc. II (assigned to Alkermes, Inc. in July 2006). Exhibit 10.4.3 to the Alkermes plc Annual Report on Form 10-K (File No. 001-35299) February 25, 2016 10.4D * Amendment to Manufacturing and Supply Agreement by and between JPI Pharmaceutica International, Janssen Pharmaceutica Inc. and Alkermes Controlled Therapeutics Inc. II, dated December 22, 2003 (assigned to Alkermes, Inc. in July 2006). Exhibit 10.6 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 011-35299) July 30, 2015 10.4E * Fourth Amendment to Manufacturing and Supply Agreement by and between JPI Pharmaceutica International, Janssen Pharmaceutica Inc. and Alkermes Controlled Therapeutics Inc. II, dated January 10, 2005 (assigned to Alkermes, Inc. in July 2006). Exhibit 10.9 to the Alkermes, Inc. Quarterly Report on Form 10-Q (File No. 001-14131) February 8, 2005 10.4F * Sixth Amendment to Manufacturing and Supply Agreement by and between JPI Pharmaceutica International, Janssen Pharmaceutica Inc. and Alkermes Controlled Therapeutics Inc. II (assigned to Alkermes, Inc. in July 2006), effective as of July 1, 2018. Exhibit 10.11 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 011-35299) October 23, 2018 72 Incorporated by reference herein Exhibit No. Description of Exhibit Form Date 10.5 * Agreement by and between JPI Pharmaceutica International, Janssen Pharmaceutica Inc. and Alkermes Controlled Therapeutics Inc. II, dated December 21, 2002 (assigned to Alkermes, Inc. in July 2006). Exhibit 10.6 to the Alkermes, Inc. Quarterly Report on Form 10-Q (File No. 001-14131) February 8, 2005 10.5A * Amendment to Agreement by and between JPI Pharmaceutica International, Janssen Pharmaceutica Inc. and Alkermes Controlled Therapeutics Inc. II, dated December 16, 2003 (assigned to Alkermes, Inc. in July 2006). Exhibit 10.7 to the Alkermes, Inc. Quarterly Report on Form 10-Q (File No. 001-14131) February 8, 2005 10.6 ** License Agreement by and among Elan Pharmaceutical Research Corp., d/b/a Nanosystems and Elan Pharma International Limited and Janssen Pharmaceutica N.V. dated as of March 31, 1999. Exhibit 10.1 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) April 26, 2023 10.6A First Amendment, dated as of July 31, 2003, to the License Agreement by and among Elan Drug Delivery, Inc. (formerly Elan Pharmaceutical Research Corp.) and Elan Pharma International Limited and Janssen Pharmaceutica NV dated March 31, 1999. Exhibit 10.24 to the Alkermes plc Annual Report on Form 10-K (File No. 001-35299) May 23, 2013 10.6B ** Agreement Amendment No. 2, dated as of July 31, 2009, to the License Agreement by and among Elan Pharmaceutical Research Corp., d/b/a Nanosystems and Elan Pharma International Limited and Janssen Pharmaceutica N.V. dated as of March 31, 1999, as amended by the First Amendment, dated as of July 31, 2003. Exhibit 10.2 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) April 26, 2023 10.7 * License and Collaboration Agreement, dated November 27, 2017, by and between Alkermes Pharma Ireland Limited and Biogen International GmbH (as successor to Biogen Swiss Manufacturing GmbH). Exhibit 10.10 to the Alkermes plc Annual Report on Form 10-K (File No. 011-35299) February 16, 2018 10.7A * First Amendment to License and Collaboration Agreement between Alkermes Pharma Ireland Limited and Biogen International GmbH (as successor to Biogen Swiss Manufacturing GmbH), effective as of October 3, 2018. Exhibit 10.12 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 011-35299) October 23, 2018 10.7B Second Amendment to License and Collaboration Agreement between Alkermes Pharma Ireland Limited and Biogen International GmbH (as successor to Biogen Swiss Manufacturing GmbH), effective as of January 31, 2019. Exhibit 10.1 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 011-35299) April 25, 2019 10.7C ** Third Amendment to License and Collaboration Agreement between Alkermes Pharma Ireland Limited and Biogen International GmbH (as successor to Biogen Swiss Manufacturing GmbH), effective as of October 30, 2019. Exhibit 10.10.3 to the Alkermes plc Annual Report on Form 10-K (File No. 011-35299) February 13, 2020 10.7D ** Fourth Amendment to License and Collaboration Agreement between Alkermes Pharma Ireland Limited and Biogen International GmbH (as successor to Biogen Swiss Manufacturing GmbH), effective as of August 25, 2022. Exhibit 10.1 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 011-35299) November 2, 2022 10.7E ** Fifth Amendment to License and Collaboration Agreement between Alkermes Pharma Ireland Limited and Biogen International GmbH (as successor to Biogen Swiss Manufacturing GmbH), effective as of June 7, 2024. Exhibit 10.1 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 011-35299) July 24, 2024 10.8 Lease, dated March 23, 2018, by and between Alkermes, Inc. and PDM 900 Unit, LLC. Exhibit 10.4 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 011-35299) April 26, 2018 10.8A First Amendment to Lease, dated June 21, 2018, by and between Alkermes, Inc. and PDM 900 Unit, LLC. Exhibit 10.2 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) July 26, 2018 10.8B Second Amendment to Lease, dated May 10, 2019, by and between Alkermes, Inc. and PDM 900 Unit, LLC. Exhibit 10.2 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) July 25, 2019 73 Incorporated by reference herein Exhibit No. Description of Exhibit Form Date 10.9 ** Confidential Settlement and License Agreement, dated August 29, 2023, by and among Alkermes, Inc., Alkermes Pharma Ireland Limited and Teva Pharmaceuticals USA, Inc. Exhibit 10.1 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) October 25, 2023 10.10 § Tax Matters Agreement, dated November 13, 2023, by and between Alkermes plc and Mural Oncology plc. Exhibit 10.1 to the Alkermes plc Current Report on Form 8-K (File No. 001-35299) November 15, 2023 10.11 ** § Asset Purchase Agreement, dated December 13, 2023, by and between Alkermes Pharma Ireland Limited, Novo Nordisk Production Ireland Limited and Novo Nordisk A/S. Exhibit 10.16 to the Alkermes plc Annual Report on Form 10-K (File No. 001-35299) February 21, 2024 10.12 † Employment Agreement, dated as of December 12, 2007, by and between Richard F. Pops and Alkermes, Inc. Exhibit 10.1 to the Alkermes, Inc. Quarterly Report on Form 10-Q (File No. 001-14131) February 11, 2008 10.12A † Amendment to Employment Agreement, dated as of October 7, 2008, by and between Alkermes, Inc. and Richard F. Pops. Exhibit 10.5 to the Alkermes, Inc. Current Report on Form 8-K (File No. 001-14131) October 7, 2008 10.12B † Amendment No. 2 to Employment Agreement, dated as of September 10, 2009 by and between Richard F. Pops and Alkermes, Inc. Exhibit 10.2 to the Alkermes, Inc. Current Report on Form 8-K (File No. 001-14131) September 11, 2009 10.13 † Form of Employment Agreement, as amended by the Form of Amendment to Employment Agreement set forth in 10.12.1, entered into by and between Alkermes, Inc. and Blair C. Jackson. Exhibit 10.3 to the Alkermes, Inc. Quarterly Report on Form 10-Q (File No. 001-14131) February 11, 2008 10.13A † Form of Amendment to Employment Agreement with Alkermes, Inc. Exhibit 10.7 to the Alkermes, Inc. Current Report on Form 8-K (File No. 001-14131) October 7, 2008 10.14 † Form of Employment Agreement entered into by and between Alkermes, Inc. and each of Iain M. Brown, David J. Gaffin, Craig C. Hopkinson, M.D. and Christian Todd Nichols. Exhibit 10.1 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 011-35299) November 2, 2016 10.14A† Offer Letter by and between Alkermes, Inc. and Craig C. Hopkinson M.D., effective as of April 24, 2017. Exhibit 10.17.1 to the Alkermes plc Annual Report on Form 10-K (File No. 011-35299) February 16, 2018 10.14B † Offer Letter, dated March 29, 2019, by and between Alkermes, Inc. and Christian Todd Nichols. Exhibit 10.1 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 011-35299) July 29, 2020 10.15 † Form of Indemnification Agreement entered into by and between Alkermes, Inc. and each of the Directors and Secretaries of Alkermes plc and its Irish subsidiaries. Exhibit 10.2 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) April 29, 2020 10.16 † Form of Deed of Indemnification entered into by and between each of the Directors, Secretaries and executive officers of Alkermes plc and its subsidiaries. Exhibit 10.1 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) April 29, 2020 10.17† Alkermes plc Amended and Restated 2008 Stock Option and Incentive Plan, as amended. Exhibit 10.1 to the Alkermes plc Quarterly Report on Form 10-Q for the quarter ended March 31, 2017 (File No. 001-35299) April 27, 2017 10.17A † Form of Stock Option Award Certificate (Non-Employee Director) under the Alkermes plc Amended and Restated 2008 Stock Option and Incentive Plan, as amended. Exhibit 10.4 to the Alkermes plc Quarterly Report on Form 10-Q for the quarter ended March 31, 2016 (File No. 001-35299) April 28, 2016 10.17B † Form of Restricted Stock Unit Award Certificate (Time Vesting Only – Irish) under the Alkermes plc Amended and Restated 2008 Stock Option and Incentive Plan, as amended. Exhibit 10.5 to the Alkermes plc Quarterly Report on Form 10-Q for the quarter ended April 28, 2016 74 Incorporated by reference herein Exhibit No. Description of Exhibit Form Date March 31, 2016 (File No. 001-35299) 10.17C † Form of Restricted Stock Unit Award Certificate (Time Vesting Only – U.S.) under the Alkermes plc Amended and Restated 2008 Stock Option and Incentive Plan, as amended. Exhibit 10.6 to the Alkermes plc Quarterly Report on Form 10-Q for the quarter ended March 31, 2016 (File No. 001-35299) April 28, 2016 10.17D † Form of Stock Option Award Certificate (Time Vesting Non-Qualified Option – Irish) under the Alkermes plc Amended and Restated 2008 Stock Option and Incentive Plan, as amended. Exhibit 10.7 to the Alkermes plc Quarterly Report on Form 10-Q for the quarter ended March 31, 2016 (File No. 001-35299) April 28, 2016 10.17E † Form Stock Option Award Certificate (Time Vesting Non-Qualified Option – U.S.) under the Alkermes plc Amended and Restated 2008 Stock Option and Incentive Plan, as amended. Exhibit 10.8 to the Alkermes plc Quarterly Report on Form 10-Q for the quarter ended March 31, 2016 (File No. 001-35299) April 28, 2016 10.17F † Form of Stock Option Award Certificate (Incentive Stock Option – U.S.) under the Alkermes plc Amended and Restated 2008 Stock Option and Incentive Plan, as amended. Exhibit 10.9 to the Alkermes plc Quarterly Report on Form 10-Q for the quarter ended March 31, 2016 (File No. 001-35299) April 28, 2016 10.17G † Form of 2008 Restricted Stock Unit Award Certificate (Performance Vesting Only) under the Alkermes plc Amended and Restated 2008 Stock Option and Incentive Plan, as amended. Exhibit 10.2 to the Alkermes, Inc. Current Report on Form 8-K (File No. 001-14131) May 22, 2009 10.18† Alkermes plc 2011 Stock Option and Incentive Plan, as amended. Exhibit 10.1 to the Alkermes plc Current Report on Form 8-K (File No. 011-35299) May 24, 2017 10.18A † Form of Incentive Stock Option Award Certificate under the Alkermes plc 2011 Stock Option and Incentive Plan, as amended. Exhibit 10.1 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) October 23, 2018 10.18B † Form of Non-Qualified Stock Option (Employee) Award Certificate under the Alkermes plc 2011 Stock Option and Incentive Plan, as amended. Exhibit 10.2 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) October 23, 2018 10.18C † Form of Restricted Stock Unit (Time-Vesting) Award Certificate under the Alkermes plc 2011 Stock Option and Incentive Plan, as amended. Exhibit 10.3 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) October 23, 2018 10.18D † Form of Restricted Stock Unit (Performance-Vesting) Award Certificate under the Alkermes plc 2011 Stock Option and Incentive Plan, as amended. Exhibit 10.4 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) October 23, 2018 10.18E † Form of Non-Qualified Stock Option (Non-Employee Director) Award Certificate under the Alkermes plc 2011 Stock Option and Incentive Plan, as amended. Exhibit 10.5 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) October 23, 2018 10.19 † Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.1 to the Alkermes plc Current Report on Form 8-K (File No. 001-35299) May 31, 2024 10.19A † Form of Incentive Stock Option Award Certificate under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.6 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) October 23, 2018 10.19B † Form of Non-Qualified Stock Option (Employee) Award Certificate under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.7 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) October 23, 2018 10.19C † Form of Restricted Stock Unit (Time-Vesting) Award Certificate under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.8 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) October 23, 2018 75 Incorporated by reference herein Exhibit No. Description of Exhibit Form Date 10.19D † Form of Restricted Stock Unit (Performance-Vesting) Award Certificate under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.6 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) July 29, 2020 10.19E † Form of Non-Qualified Stock Option (Non-Employee Director) Award Certificate under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.4 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) July 29, 2020 10.19F † Form of Non-Employee Director Restricted Stock Unit (Time-Vesting) Award Certificate under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.5 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) July 29, 2020 10.19G † Form of Non-Employee Director New Director Grant Non-Qualified Stock Option Award Certificate under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.1.1 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) July 27, 2022 10.19H † Form of Non-Employee Director New Director Grant Restricted Stock Unit (Time-Vesting) Award Certificate under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.1.2 to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) July 27, 2022 10.19I † Form of Incentive Stock Option Award Certificate for Reporting Officers under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.19-9 to the Alkermes plc Annual Report on Form 10-K (File No. 001-35299) February 16, 2023 10.19J † Form of Non-Qualified Stock Option Award Certificate for Reporting Officers under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.19-10 to the Alkermes plc Annual Report on Form 10-K (File No. 001-35299) February 16, 2023 10.19K † Form of Restricted Stock Unit (Time-Vesting) Award Certificate for Reporting Officers under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.19-11 to the Alkermes plc Annual Report on Form 10-K (File No. 001-35299) February 16, 2023 10.19L † Form of Restricted Stock Unit (Performance-Vesting) Award Certificate for Reporting Officers under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.19-12 to the Alkermes plc Annual Report on Form 10-K (File No. 001-35299) February 16, 2023 10.19M † Form of Restricted Stock Unit (Performance-Vesting) Award Certificate (rev. 2024) for Reporting Officers under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.25M to the Alkermes plc Annual Report on Form 10-K (File No. 001-35299) February 21, 2024 10.19N † Form of Restricted Stock Unit (Performance-Vesting) Award Certificate (rev. 2024) under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.25N to the Alkermes plc Annual Report on Form 10-K (File No. 001-35299) February 21, 2024 10.19O † Form of Non-Employee Director Non-Qualified Stock Option Award Certificate (rev. 2024) under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.2A to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) July 24, 2024 10.19P † Form of Non-Employee Director Restricted Stock Unit Award (Time-Vesting) Award Certificate (rev. 2024) under the Alkermes plc 2018 Stock Option and Incentive Plan, as amended. Exhibit 10.2A to the Alkermes plc Quarterly Report on Form 10-Q (File No. 001-35299) July 24, 2024 19.1 # Alkermes plc Insider Trading Policy. 21.1 # List of subsidiaries. 23.1 # Consent of PricewaterhouseCoopers LLP, an independent registered public accounting firm. 24.1 # Power of Attorney (included on the signature pages hereto). 31.1 # Certification Pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934. 76 Incorporated by reference herein Exhibit No. Description of Exhibit Form Date 31.2 # Certification Pursuant to Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934. 32.1 ‡ Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. 97 † Alkermes plc Incentive Compensation Recoupment Policy. Exhibit 97 to the Alkermes plc Annual Report on Form 10-K (File No. 001-35299) February 21, 2024 101.SCH # Inline XBRL Taxonomy Extension Schema with Embedded Linkbases Document. 104 Cover Page Interactive Data File (formatted as Inline XBRL with applicable taxonomy extension information contained in Exhibits 101). † Indicates a management contract or any compensatory plan, contract or arrangement. # Filed herewith. ‡ Furnished herewith. * Confidential treatment has been granted or requested for certain portions of this exhibit. Such portions have been filed separately with the SEC pursuant to a confidential treatment request. ** Portions of this exhibit (indicated by “[**]”) have been omitted pursuant to Item 601(b) of Regulation S-K. The Company undertakes to furnish an unredacted copy of this exhibit upon request by the U.S. Securities and Exchange Commission. § Schedules and similar attachments to this exhibit have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company undertakes to furnish copies of any omitted schedules and similar attachments upon request by the U.S. Securities and Exchange Commission. Item 16. Form 10-K Summary None. 77 SIGNAT URES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. ALKERMES PLC By: /s/ Richard F. Pops Richard F. Pops Chairman and Chief Executive Officer February 12, 2025 POWER OF A TTORNEY Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated. Each person whose signature appears below in so signing also makes, constitutes and appoints Richard F. Pops and Blair C. Jackson, and each of them, his true and lawful attorney-in-fact, with full power of substitution, for him in any and all capacities, to execute and cause to be filed with the Securities and Exchange Commission any and all amendments to this Annual Report, with exhibits thereto and other documents in connection therewith, and hereby ratifies and confirms all that said attorney-in-fact or his substitute or substitutes may do or cause to be done by virtue hereof. Signature Title Date /s/ Richard F. Pops Richard F. Pops Chairman and Chief Executive Officer (Principal Executive Officer) February 12, 2025 /s/ B lair C. Jackson Blair C. Jackson Executive Vice President, Chief Operating Officer (Interim Principal Financial Officer) February 12, 2025 /s/ S amuel J. Parisi Samuel J. Parisi Vice President, Finance (Interim Principal Accounting Officer) February 12, 2025 /s/ Emily Peterson Alva Emily Peterson Alva Director February 12, 2025 /s/ Shane M. Cooke Shane M. Cooke Director February 12, 2025 /s/ David A. Daglio, Jr. Director February 12, 2025 David A. Daglio, Jr. /s/ Richard B. Gaynor Richard B. Gaynor Director February 12, 2025 /s/ Cato T. Laurencin Director February 12, 2025 Cato T. Laurencin /s/ Nancy S. Lurker Nancy S. Lurker Director February 12, 2025 /s/ Brian P. McKeon Brian P. McKeon Director February 12, 2025 /s/ Nancy L. Snyderman Nancy L. Snyderman Director February 12, 2025 /s/ Frank Anders Wilson Frank Anders Wilson Director February 12, 2025 /s/ Christopher I. Wright Christopher I. Wright Director February 12, 2025 78 Report of Independent R egistere d Public Accounting Firm To the Board of Directors and Shareholders of Alkermes plc Opinions on the Financial Statements and Internal Control over Financial Reporting We have audited the accompanying consolidated balance sheets of Alkermes plc and its subsidiaries (the “Company”) as of December 31, 2024 and 2023, and the related consolidated statements of operations and comprehensive income (loss), of shareholders’ equity and of cash flows for each of the three years in the period ended December 31, 2024, including the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company's internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024 in conformity with accounting principles generally accepted in the United States of America. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the COSO. Basis for Opinions The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in Management’s Annual Report on Internal Control over Financial Reporting appearing under Item 9A. Our responsibility is to express opinions on the Company’s consolidated financial statements and on the Company's internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. F- 1 Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. Critical Audit Matters The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. Rebate Accruals – Medicaid Drug Rebate Program As described in Notes 2 and 11 to the consolidated financial statements, the Company’s revenues from product sales are recorded net of reserves established for applicable discounts and allowances that are offered within contracts with the Company’s customers, health care providers or payers. The Company records accruals for rebates to U.S. states under the Medicaid Drug Rebate Program as a reduction of sales when the product is shipped into the distribution channel using the expected value method. As of December 31, 2024, accrued Medicaid rebates were $202.0 million, of which a significant amount related to the Medicaid Drug Rebate Program. The Company rebates individual U.S. states for all eligible units purchased under the Medicaid program based on a rebate per unit calculation, which is based on the Company’s average manufacturer prices. The Company estimates expected unit sales to individuals covered by Medicaid and rebates per unit under the Medicaid program and adjusts its rebate accrual based on actual unit sales and rebates per unit and changes in trends in Medicaid utilization. The principal considerations for our determination that performing procedures relating to rebate accruals for the Medicaid Drug Rebate Program is a critical audit matter are (i) the significant judgment by management due to significant measurement uncertainty involved in developing the reserves, as the reserves are based on assumptions developed using historical experience, current contractual requirements, specific known market events and payment patterns and (ii) a high degree of auditor judgment, subjectivity and effort in applying procedures and evaluating evidence related to these assumptions. Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures included testing the effectiveness of controls relating to rebate accruals for the Medicaid Drug Rebate Program, including controls over the assumptions used to estimate the rebate accruals. These procedures also included, among others, (i) developing an independent estimate of the rebate accruals by utilizing third-party data related to product sales, the historical trend of actual rebate claims paid and consideration of contractual requirement changes and market events; (ii) comparing the independent estimate to management’s estimate; and (iii) testing rebate claims processed by the Company. /s/ PricewaterhouseCoopers LLP Boston, Massachusetts February 12, 2025 We have served as the Company’s auditor since 2007. F- 2 ALKERMES PLC AND SUBSIDIARIES CONSOLIDATED B ALANCE SHEETS December 31, 2024 and 2023 December 31, 2024 December 31, 2023 (In thousands, except share and per share amounts) ASSETS CURRENT ASSETS: Cash and cash equivalents $ 291,146 $ 457,469 Investments—short-term 460,522 316,022 Receivables, net 384,528 332,477 Inventory 182,887 186,406 Prepaid expenses and other current assets 91,282 98,166 Contract assets 4,990 706 Assets held for sale — 94,260 Total current assets 1,415,355 1,485,506 PROPERTY, PLANT AND EQUIPMENT, NET 227,564 226,943 INVESTMENTS—LONG-TERM 73,148 39,887 RIGHT-OF-USE ASSETS 84,245 91,460 INTANGIBLE ASSETS, NET AND GOODWILL 83,917 85,018 DEFERRED TAX ASSETS 154,835 195,888 OTHER ASSETS 16,503 11,521 TOTAL ASSETS $ 2,055,567 $ 2,136,223 LIABILITIES AND SHAREHOLDERS’ EQUITY CURRENT LIABILITIES: Accounts payable and accrued expenses $ 185,332 $ 240,561 Accrued sales discounts, allowances and reserves 272,452 263,641 Operating lease liabilities—short-term 6,166 5,746 Contract liabilities—short-term 1,249 2,730 Current portion of long-term debt — 3,000 Liabilities related to discontinued operations — 4,542 Total current liabilities 465,199 520,220 LONG-TERM DEBT — 287,730 OPERATING LEASE LIABILITIES—LONG-TERM 69,372 75,709 OTHER LONG-TERM LIABILITIES 56,019 49,878 Total liabilities 590,590 933,537 COMMITMENTS AND CONTINGENT LIABILITIES (Note 19) SHAREHOLDERS’ EQUITY: Preferred shares, par value, $ 0.01 per share; 50,000,000 shares authorized; and zero issued and outstanding at December 31, 2024 and 2023 — — Ordinary shares, par value, $ 0.01 per share; 450,000,000 shares authorized; 176,670,785 and 172,569,051 shares issued; and 162,176,994 and 166,979,833 shares outstanding at December 31, 2024 and 2023, respectively 1,767 1,726 Treasury shares, at cost ( 14,493,791 and 5,589,218 shares at December 31, 2024 and 2023, respectively) ( 419,255 ) ( 189,336 ) Additional paid-in capital 2,860,890 2,736,934 Accumulated other comprehensive loss ( 1,967 ) ( 3,110 ) Accumulated deficit ( 976,458 ) ( 1,343,528 ) Total shareholders’ equity 1,464,977 1,202,686 TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY $ 2,055,567 $ 2,136,223 The accompanying notes are an integral part of these consolidated financial statements. F- 3 ALKERMES PLC AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPE RATIONS AND COMPREHENSIVE INCOME (LOSS) Years Ended December 31, 2024, 2023 and 2022 Year Ended December 31, 2024 2023 2022 (In thousands, except per share amounts) REVENUES: Product sales, net $ 1,083,534 $ 919,998 $ 777,552 Manufacturing and royalty revenues 474,095 743,388 331,983 License revenue — — 2,000 Research and development revenue 3 19 260 Total revenues 1,557,632 1,663,405 1,111,795 EXPENSES: Cost of goods manufactured and sold (exclusive of amortization of acquired intangible assets shown below) 245,331 253,037 218,068 Research and development 245,326 270,806 272,702 Selling, general and administrative 645,238 689,751 590,751 Amortization of acquired intangible assets 1,101 35,689 36,363 Total expenses 1,136,996 1,249,283 1,117,884 OPERATING INCOME FROM CONTINUING OPERATIONS 420,636 414,122 ( 6,089 ) OTHER INCOME (EXPENSE), NET: Interest income 42,450 30,854 7,629 Interest expense ( 22,578 ) ( 23,032 ) ( 13,040 ) Change in the fair value of contingent consideration — — ( 21,750 ) Other income (expense), net 3,242 ( 425 ) 2,122 Total other income (expense), net 23,114 7,397 ( 25,039 ) INCOME (LOSS) BEFORE INCOME TAXES 443,750 421,519 ( 31,128 ) INCOME TAX PROVISION (BENEFIT) 71,612 ( 97,638 ) 2,024 NET INCOME (LOSS) FROM CONTINUING OPERATIONS 372,138 519,157 ( 33,152 ) LOSS FROM DISCONTINUED OPERATIONS, NET OF TAX ( 5,068 ) ( 163,400 ) ( 125,115 ) NET INCOME (LOSS) $ 367,070 $ 355,757 $ ( 158,267 ) EARNINGS (LOSS) PER ORDINARY SHARE: Earnings (loss) per ordinary share from continuing operations - basic $ 2.25 $ 3.12 $ ( 0.20 ) Loss per ordinary share from discontinued operations - basic $ ( 0.03 ) $ ( 0.98 ) $ ( 0.76 ) Earnings (loss) per ordinary share - basic $ 2.22 $ 2.14 $ ( 0.97 ) Earnings (loss) per ordinary share from continuing operations - diluted $ 2.20 $ 3.06 $ ( 0.20 ) Loss per ordinary share from discontinued operations - diluted $ ( 0.03 ) $ ( 0.96 ) $ ( 0.76 ) Earnings (loss) per ordinary share - diluted $ 2.17 $ 2.10 $ ( 0.97 ) WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES OUTSTANDING: Basic 165,392 166,223 163,742 Diluted 169,198 169,730 163,742 COMPREHENSIVE INCOME (LOSS): Net income (loss) $ 367,070 $ 355,757 $ ( 158,267 ) Holding gain (loss), net of a tax provision (benefit) of $ 292 , $ 1,195 and $( 973 ), respectively 1,143 7,779 ( 7,166 ) COMPREHENSIVE INCOME (LOSS) $ 368,213 $ 363,536 $ ( 165,433 ) The accompanying notes are an integral part of these consolidated financial statements. F- 4 ALKERMES PLC AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY Years Ended December 31, 2024, 2023 and 2022 Accumulated Additional Other Ordinary Shares Paid-In Comprehensive Accumulated Treasury Stock Shares Amount Capital Loss Deficit Shares Amount Total (In thousands, except share data) BALANCE — December 31, 2021 165,790,549 $ 1,658 $ 2,798,325 $ ( 3,723 ) $ ( 1,541,018 ) ( 3,853,222 ) $ ( 142,658 ) $ 1,112,584 Issuance of ordinary shares under employee stock plans 3,160,644 32 19,598 — — — — 19,630 Receipt of Alkermes' ordinary shares for the purchase of stock options or to satisfy minimum tax withholding obligations related to share-based awards — — — — — ( 720,962 ) ( 18,204 ) ( 18,204 ) Share-based compensation — — 95,176 — — — — 95,176 Unrealized loss on marketable securities, net of tax benefit of $ 973 — — — ( 7,166 ) — — — ( 7,166 ) Net loss — — — — ( 158,267 ) — — ( 158,267 ) BALANCE — December 31, 2022 168,951,193 $ 1,690 $ 2,913,099 $ ( 10,889 ) $ ( 1,699,285 ) ( 4,574,184 ) $ ( 160,862 ) $ 1,043,753 Issuance of ordinary shares under employee stock plans 3,617,858 36 16,724 — — — — 16,760 Receipt of Alkermes' ordinary shares for the purchase of stock options or to satisfy minimum tax withholding obligations related to share-based awards — — — — — ( 1,015,034 ) ( 28,474 ) ( 28,474 ) Share-based compensation — — 100,871 — — — — 100,871 Unrealized gain on marketable securities, net of tax provision of $ 1,195 — — — 7,779 — — — 7,779 Distribution of Mural Oncology plc — — ( 293,760 ) — — — — ( 293,760 ) Net income — — — — 355,757 — — 355,757 BALANCE —December 31, 2023 172,569,051 $ 1,726 $ 2,736,934 $ ( 3,110 ) $ ( 1,343,528 ) ( 5,589,218 ) $ ( 189,336 ) $ 1,202,686 Issuance of ordinary shares under employee stock plans 4,101,734 41 27,531 — — — — 27,572 Receipt of Alkermes' ordinary shares for the purchase of stock options or to satisfy minimum tax withholding obligations related to share-based awards — — — — — ( 1,010,156 ) ( 29,637 ) ( 29,637 ) Repurchase of Alkermes' ordinary shares — — — — — ( 7,894,417 ) ( 200,282 ) ( 200,282 ) Share-based compensation — — 96,425 — — — — 96,425 Unrealized gain on marketable securities, net of tax provision of $ 292 — — — 1,143 — — — 1,143 Net income — — — — 367,070 — — 367,070 BALANCE —December 31, 2024 176,670,785 $ 1,767 $ 2,860,890 $ ( 1,967 ) $ ( 976,458 ) ( 14,493,791 ) $ ( 419,255 ) $ 1,464,977 The accompanying notes are an integral part of these consolidated financial statements. F- 5 ALKERMES PLC AND SUBSIDIARIES CONSOLIDATED STATEM ENTS OF CASH FLOWS Years Ended December 31, 2024, 2023 and 2022 Year Ended December 31, 2024 2023 2022 (In thousands) CASH FLOWS FROM OPERATING ACTIVITIES: Net income (loss) $ 367,070 $ 355,757 $ ( 158,267 ) Adjustments to reconcile net income (loss) to cash flows from operating activities: Depreciation and amortization 28,533 74,927 77,862 Share-based compensation expense 96,637 100,905 94,254 Deferred income taxes 40,522 ( 99,902 ) ( 32,795 ) Change in the fair value of contingent consideration — — 21,750 Other non-cash charges 4,512 6,329 5,531 Changes in assets and liabilities: Receivables ( 52,052 ) ( 44,510 ) 25,250 Contract assets ( 4,284 ) 8,223 4,434 Inventory 3,091 ( 2,712 ) ( 31,021 ) Prepaid expenses and other assets 2,254 ( 34,847 ) ( 5,328 ) Right-of-use assets 7,215 15,387 16,569 Accounts payable and accrued expenses ( 57,967 ) 23,009 15,534 Accrued sales discounts, allowances and reserves 8,811 11,526 14,899 Contract liabilities ( 3,525 ) ( 5,926 ) ( 7,129 ) Operating lease liabilities ( 10,123 ) ( 16,147 ) ( 33,225 ) Other long-term liabilities 8,430 9,334 12,726 Cash flows provided by operating activities 439,124 401,353 21,044 CASH FLOWS FROM INVESTING ACTIVITIES: Additions of property, plant and equipment ( 33,484 ) ( 48,048 ) ( 38,255 ) Proceeds from the sale of equipment 461 354 — Proceeds from contingent consideration — — 1,273 Return of Fountain Healthcare Partners II, L.P. investment 43 — 485 Proceeds from the sale of the Athlone Facility 97,933 — — Purchases of investments ( 486,547 ) ( 254,471 ) ( 309,671 ) Sales and maturities of investments 310,286 355,522 281,627 Cash flows (used in) provided by investing activities ( 111,308 ) 53,357 ( 64,541 ) CASH FLOWS FROM FINANCING ACTIVITIES: Cash transferred to Mural Oncology plc at separation — ( 275,000 ) — Proceeds from the issuance of ordinary shares under share-based compensation arrangements 27,572 16,760 19,630 Employee taxes paid related to net share settlement of equity awards ( 29,637 ) ( 28,474 ) ( 18,204 ) Payment for the repurchase of ordinary shares ( 200,282 ) — — Prepayment of long-term debt ( 289,542 ) — — Principal payments of long-term debt ( 2,250 ) ( 3,000 ) ( 3,000 ) Cash flows used in financing activities ( 494,139 ) ( 289,714 ) ( 1,574 ) NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS ( 166,323 ) 164,996 ( 45,071 ) CASH AND CASH EQUIVALENTS—Beginning of period 457,469 292,473 337,544 CASH AND CASH EQUIVALENTS—End of period $ 291,146 $ 457,469 $ 292,473 SUPPLEMENTAL CASH FLOW DISCLOSURE: Cash paid for interest $ 23,010 $ 22,748 $ 13,563 Cash paid for taxes $ 2,592 $ 44,243 $ 20,749 Non-cash investing and financing activities: Purchased capital expenditures included in accounts payable and accrued expenses $ 2,254 $ 2,645 $ 2,950 The accompanying notes are an integral part of these consolidated financial statements. F- 6 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION Alkermes plc is a global biopharmaceutical company that seeks to develop innovative medicines in the field of neuroscience. Alkermes has a portfolio of proprietary commercial products for the treatment of alcohol dependence and opioid dependence, schizophrenia and bipolar I disorder and a pipeline of clinical and preclinical candidates in development for neurological disorders, including narcolepsy and idiopathic hypersomnia. Headquartered in Ireland, Alkermes also has a corporate office and research and development (“R&D”) center in Massachusetts and a manufacturing facility in Ohio. In May 2024, the Company completed the sale of its development and manufacturing facility in Athlone, Ireland (the “Athlone Facility”) and related business to Novo Nordisk (“Novo”) pursuant to an asset purchase agreement entered into in December 2023. The Company and Novo also entered into subcontracting arrangements to continue certain development and manufacturing activities performed at the Athlone Facility for a period of time after the closing of the transaction, which activities may continue through the end of 2025. In connection with the sale of the Athlone Facility, the Company received $ 97.9 million from Novo, which included a payment of approximately $ 91.0 million for the facility and certain related assets, and recorded a gain of approximately $ 1.5 million within “ Other income (expense), net ” in the accompanying consolidated statements of operations and comprehensive income (loss) for the year ended December 31, 2024. As of December 31, 2023, the Company classified the assets described under the asset purchase agreement for the sale as “Assets held for sale” in the accompanying consolidated balance sheet. In November 2023, the Company completed the separation of its former oncology business into Mural Oncology plc (“Mural”), a new, independent, publicly-traded company (the “Separation”). The Separation was effected by means of a distribution of all of the outstanding ordinary shares of Mural to the Company’s shareholders (the “Distribution”), in which each of the Company’s shareholders received one ordinary share, nominal value $ 0.01 per share, of Mural for every ten ordinary shares, par value $ 0.01 per share, of the Company (the “Distribution Ratio”) held by such shareholder as of the close of business on November 6, 2023, the record date for the Distribution (the “Record Date”). The historical results of the oncology business have been reflected as discontinued operations in the Company’s consolidated financial statements through November 15, 2023 (the “Separation Date”). For additional information related to the Separation, see Note 3, Discontinued Operations in these “Notes to Consolidated Financial Statements” in this Annual Report. 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Principles of Consolidation The consolidated financial statements include the accounts of Alkermes plc and its wholly-owned subsidiaries. Intercompany accounts and transactions have been eliminated. Columns and rows within tables may not sum due to rounding. Reclassification The Company has presented its former oncology business as discontinued operations in its consolidated financial statements as of December 31, 2023 and for the years ended December 31, 2023 and 2022. See Note 3, Discontinued Operations in these “Notes to Consolidated Financial Statements” in this Annual Report for additional information. Discontinued Operations The Company determined that the Separation met the criteria for classification of the former oncology business as discontinued operations in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) 205, Discontinued Operations . Accordingly, the accompanying consolidated financial statements have been updated to present the results of the oncology business as discontinued operations through the Separation Date for the years ended December 31, 2023 and 2022 in the consolidated statements of operations and comprehensive income (loss). Assets Held for Sale In connection with the sale of the Athlone Facility, the Company reviewed FASB ASC 805, Business Combinations (“Topic 805”) and, based on the definitions therein, determined that the Athlone Facility constituted a business. Accordingly, the assets associated with the sale of the Athlone Facility were classified as “Assets held for sale” in the accompanying consolidated balance sheet as of December 31, 2023. F- 7 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Use of Estimates The preparation of the Company’s consolidated financial statements in accordance with accounting principles generally accepted in the United States (“GAAP”) requires that Company management make estimates, judgments and assumptions that may affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, the Company evaluates its estimates, judgments and methodologies, including but not limited to, those related to revenue from contracts with its customers and related allowances, impairment of intangibles and long-lived assets, share-based compensation, income taxes including the valuation allowance for deferred tax assets, valuation of investments and litigation. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities. Actual results may differ from these estimates under different assumptions or conditions. Cash and Cash Equivalents The Company values its cash and cash equivalents at cost plus accrued interest, which the Company believes approximates its market value. The Company considers as cash equivalents only those investments that are highly liquid, readily convertible into cash and so near their maturity (three months from the date of purchase) that they present insignificant risk of change in value because of interest rate changes. Investments The Company has investments in various types of securities, consisting primarily of United States (“U.S.”). government and agency obligations and corporate debt securities. The Company generally holds its interest-bearing investments with major financial institutions and in accordance with documented investment policies. The Company limits the amount of credit exposure to any one financial institution or corporate issuer. At December 31, 2024, substantially all these investments were classified as available-for-sale and were recorded at fair value. Unrealized gains and losses are included in accumulated other comprehensive loss in equity, net of related tax, unless: (i) the security has experienced a credit loss; (ii) the Company has determined that it has the intent to sell the security; or (iii) the Company has determined that it is more likely than not that it will have to sell the security before its expected recovery. Periodic reviews are conducted to identify and evaluate each investment that has an unrealized loss in accordance with the meaning of other-than-temporary impairment. An unrealized loss exists when the current fair value of an individual security is less than its amortized cost basis. For available-for-sale debt securities with unrealized losses, the Company performs an analysis to assess whether it intends to sell, or whether it would more likely than not be required to sell, the security before the expected recovery of the amortized cost basis. Where the Company intends to sell a security, or may be required to do so, the security’s decline in fair value is deemed to be other-than-temporary and the full amount of the unrealized loss is reflected in earnings as an impairment loss. Regardless of the Company’s intent to sell a security, the Company performs additional analysis on all securities with unrealized losses to evaluate losses associated with the creditworthiness of the security. Credit losses are identified where the Company does not expect to receive cash flows sufficient to recover the amortized cost basis of a security. The Company’s held-to-maturity investments are restricted investments held as collateral under letters of credit related to certain of the Company’s agreements and are included in “Investments—long-term,” in the accompanying consolidated balance sheets. Fair Value of Financial Instruments The Company’s financial assets and liabilities are recorded at fair value and are classified as Level 1, 2 or 3 within the fair value hierarchy, as described in the accounting standards for fair value measurement. At December 31, 2024, the Company’s financial assets consisted of cash equivalents and investments and are classified within the fair value hierarchy as follows: • Level 1 –these valuations are based on a market approach using quoted prices in active markets for identical assets. Valuations of these products do not require a significant degree of judgment. Assets utilizing Level 1 inputs at December 31, 2024 included U.S. treasury securities, marketable securities classified as cash equivalents and a fixed term deposit account; and • Level 2 –these valuations are based on quoted prices for identical or similar assets in active markets or other market observable inputs such as interest rates, yield curves, foreign currency spot rates and option pricing valuation models. Assets utilizing Level 2 inputs at December 31, 2024 included U.S. government agency debt securities and investments in corporate debt securities that are trading in the credit markets. F- 8 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The carrying amounts reflected in the consolidated balance sheets for cash and cash equivalents, accounts receivable, contract assets, other current assets, accounts payable and accrued expenses and accrued sales discounts, allowances and reserves approximate fair value due to their short-term nature. Inventory Inventory is stated at the lower of cost and net realizable value. The Company utilizes a standard cost basis, which approximates cost determined using the first-in first-out method. Cost is determined using the first-in, first-out method. Included in inventory are raw materials used in production of preclinical and clinical products, which have alternative future use and are charged to R&D expense when consumed. The cost elements included within inventory include three primary categories for commercial products: cost of raw materials; direct labor; and overhead. Overhead is based on the normal capacity of the Company’s production facility and does not include costs from abnormally low production or idle capacity, which are expensed directly to the consolidated statement of operations and comprehensive income (loss). The Company capitalizes inventory costs associated with its products prior to regulatory approval when, based on management’s judgment, future commercialization of the product is considered probable and future economic benefit from such product is expected to be realized. The Company assesses the regulatory approval process and where the particular product stands in relation to that approval process, including any known safety, efficacy or quality concerns, potential labeling restrictions and other potential impediments to approval. The Company also considers the shelf life of the product in relation to the expected timeline for approval and considers issues that may prevent or delay commercialization, including issues that may arise in relation to the manufacturing of the product. The Company expenses previously capitalized costs related to pre-approval inventory upon a change in such judgment, due to, among other potential factors, a denial or significant delay of approval by relevant regulatory agencies or other issues that may make the pre-approval inventory batches less likely or unlikely to be commercialized and to result in future economic benefit. Property, Plant and Equipment Property, plant and equipment are recorded at cost, subject to review for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. Expenditures for repairs and maintenance are charged to expense as incurred and major renewals and improvements are capitalized. Depreciation is calculated using the straight-line method over the following estimated useful lives of the assets: Asset group Term Buildings and improvements 25 years Furniture, fixtures and equipment 5 - 7 years Leasehold improvements Shorter of useful life or lease term Goodwill and Intangible Assets Goodwill represents the excess cost of the Company’s investment in the net assets of acquired companies over the fair value of the underlying identifiable net assets at the date of acquisition. The Company’s goodwill consists solely of goodwill created as a result of the Company’s acquisition of Elan Drug Technologies (“EDT”) from Elan Corporation, plc (such acquisition, the “Business Combination”) in September 2011 and has been assigned to one reporting unit. A reporting unit is an operating segment or one level below an operating segment or a component to which goodwill is assigned when initially recorded. Goodwill is not amortized but is reviewed for impairment on an annual basis, as of October 31, and whenever events or changes in circumstances indicate that the carrying value of the goodwill might not be recoverable. The Company has the option to first assess qualitative factors to determine whether it is necessary to perform the quantitative impairment test. If the Company elects this option and believes, as a result of the qualitative assessment, that it is more-likely-than-not that the fair value of its reporting unit is less than its carrying amount, the quantitative impairment test is required; otherwise, no further testing is required. Alternatively, the Company may elect to not first assess qualitative factors and immediately perform the quantitative impairment test. In the quantitative impairment test, the Company compares the fair value of its reporting unit to its carrying value. If the carrying value of the net assets assigned to the reporting unit exceeds the fair value of the reporting unit, then the Company would record an impairment loss equal to the difference. When some, but not all, of a reporting unit is to be disposed of, the accounting for that reporting unit’s goodwill will depend on whether the disposal group constitutes a business. If the disposal group constitutes a business, the Company attributes a portion of the reporting unit’s goodwill to the disposal group based on the relative fair values of: (i) the disposal group; and (ii) the portion of the reporting unit that will be retained. F- 9 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The Company’s finite-lived intangible assets, consisting of core developed technology and collaboration agreements acquired as part of the Business Combination, were recorded at fair value at the time of their acquisition and are stated within the Company’s consolidated balance sheets net of accumulated amortization. The finite-lived intangible assets are amortized over their estimated useful lives using the economic use method, which reflects the pattern that the economic benefits of the intangible assets are consumed as revenue is generated from the underlying patent or contract. The useful lives of the Company’s intangible assets are primarily based on the legal or contractual life of the underlying patent or contract, which does not include additional years for the potential extension or renewal of the contract or patent. Impairment of Long-Lived Assets The Company reviews long-lived assets to be held and used for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable. Conditions that would necessitate an impairment assessment include a significant decline in the observable market value of an asset; a significant change in the extent or manner in which an asset is used; a significant adverse change in legal factors or in the business climate that could affect the value of a long-lived asset; an accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of a long-lived asset; a current-period operating or cash flow loss combined with a history of operating or cash-flow losses or a projection or forecast that demonstrates continuing losses associated with the use of a long-lived asset; or a current expectation that, more likely than not, a long-lived asset will be sold or otherwise disposed of significantly before the end of its previously estimated useful life. Determination of recoverability is based on an estimate of undiscounted future cash flows resulting from the use of the asset and its eventual disposition. In the event that such cash flows are not expected to be sufficient to recover the carrying amount of the assets, the assets are written-down to their estimated fair values. Long-lived assets to be disposed of are carried at fair value less costs to sell them. Revenue from Contracts with Customers The Company recognizes revenue when its customer obtains control of promised goods or services, in an amount that reflects the consideration which it expects to receive in exchange for those goods or services. The Company recognizes revenue following the five-step model prescribed in accordance with FASB ASC 606, Revenue from Contracts with Customers (“Topic 606”): (i) identify contract(s) with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the Company satisfies the performance obligations. Product Sales, Net The Company’s product sales, net consist of sales in the U.S. of VIVITROL ® , ARISTADA ® , ARISTADA INITIO ® and LYBALVI ® , primarily to wholesalers, specialty distributors and pharmacies. Product sales, net are recognized when the customer obtains control of the product, which is when the product has been received by the customer. Revenues from product sales are recorded net of reserves established for applicable discounts and allowances that are offered within contracts with the Company’s customers, healthcare providers or payers. The Company’s process for estimating reserves established for these variable consideration components does not differ materially from historical practices. The transaction price, which includes variable consideration reflecting the impact of discounts and allowances, may be subject to constraint and is included in the net sales price only to the extent that it is probable that a significant reversal of the amount of the cumulative revenues recognized will not occur in a future period. Actual amounts may ultimately differ from the Company’s estimates. If actual results vary, the Company adjusts these estimates, which could have an effect on earnings in the period of adjustment. The following are the Company’s significant categories of sales discounts and allowances: • Medicaid Rebates —the Company records accruals for rebates to U.S. states under the Medicaid Drug Rebate Program as a reduction of sales when the product is shipped into the distribution channel using the expected value method. The Company rebates individual U.S. states for all eligible units purchased under the Medicaid program based on a rebate per unit calculation, which is based on the Company’s average manufacturer prices. The Company estimates expected unit sales to individuals covered by Medicaid and rebates per unit under the Medicaid program and adjusts its rebate accrual based on actual unit sales and rebates per unit and changes in trends in Medicaid utilization. In 2024, actual Medicaid utilization rates related to VIVITROL were lower than original estimates, due, in part, to $ 8.7 million in actual credits received from certain states in the fourth quarter of 2024 related to duplicate Medicaid billings. Medicaid rebates for the Company’s other products have not differed materially from the Company’s estimates; • Chargebacks —discounts that occur when contracted indirect customers purchase directly from wholesalers and specialty distributors. Contracted customers generally purchase a product at its contracted price. The wholesaler or specialty distributor, in turn, then generally charges back to the Company the difference between the wholesale acquisition cost and the contracted price paid to the wholesaler or specialty distributor by the customer. The allowance for chargebacks is made using the expected value method and is based on actual and expected utilization of these programs. Chargebacks could exceed historical experience and the Company’s estimates of future participation in these programs. To date, actual chargebacks have not differed materially from the Company’s estimates; F- 10 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) • Product Discounts —cash consideration, including sales incentives, given by the Company under agreements with a number of wholesaler, distributor, pharmacy, and treatment provider customers that provide them with a discount on the purchase price of products. The reserve is made using the expected value method and to date, actual product discounts have not differed materially from the Company’s estimates; • Product Returns —the Company records an estimate for product returns at the time its customers take control of their product. The Company estimates this liability using the expected returns of product sold based on historical return levels and specifically identified anticipated returns due to known business conditions and product expiry dates. Return amounts are recorded as a reduction of sales. Once product is returned, it is destroyed. To date, actual product returns have not differed materially from the Company’s estimates; and • Medicare Part D —the Company records accruals for Medicare Part D liabilities under the Medicare Coverage Gap Discount Program (“CGDP”) as a reduction of sales. Under the CGDP, patients reaching the annual coverage gap threshold are eligible for reimbursement coverage for out-of-pocket costs for covered prescription drugs. Under an agreement with the Centers for Medicare and Medicaid Services, manufacturers are responsible to reimburse prescription plan sponsors for the portion of out-of-pocket expenses not covered under their Medicare plans. To date, actual Medicare Part D rebates have not differed materially from the Company’s estimates. A rollfor ward of the Company’s provisions for sales and allowances is as follows: December 31, 2024 (In thousands) Contractual Adjustments (1) Discounts (2) Product Returns Other Total Beginning balance — December 31, 2023 $ 234,414 $ 28,690 $ 41,064 $ 10,164 $ 314,332 Current provisions relating to sales in current year 557,651 386,625 28,627 87,373 1,060,276 Adjustments relating to prior years ( 20,562 ) — ( 3,700 ) — ( 24,262 ) Payments/credits relating to sales in current year ( 369,869 ) ( 353,629 ) — ( 70,752 ) ( 794,250 ) Payments/credits relating to sales in prior years ( 172,656 ) ( 18,041 ) ( 15,484 ) ( 13,488 ) ( 219,669 ) Ending balance — December 31, 2024 $ 228,978 $ 43,645 $ 50,507 $ 13,297 $ 336,427 December 31, 2023 (In thousands) Contractual Adjustments (1) Discounts (2) Product Returns Other Total Beginning balance — December 31, 2022 $ 226,741 $ 26,175 $ 29,666 $ 7,938 $ 290,520 Current provisions relating to sales in current year 509,780 326,860 33,417 71,449 941,506 Adjustments relating to prior years ( 8,921 ) — 2,841 — ( 6,080 ) Payments/credits relating to sales in current year ( 308,353 ) ( 293,785 ) — ( 56,224 ) ( 658,362 ) Payments/credits relating to sales in prior years ( 184,833 ) ( 30,560 ) ( 24,860 ) ( 12,999 ) ( 253,252 ) Ending balance — December 31, 2023 $ 234,414 $ 28,690 $ 41,064 $ 10,164 $ 314,332 December 31, 2022 (In thousands) Contractual Adjustments (1) Discounts (2) Product Returns Other Total Beginning balance — December 31, 2021 $ 209,760 $ 24,150 $ 24,313 $ 9,585 $ 267,808 Current provisions relating to sales in current year 434,143 281,308 15,851 58,788 790,090 Adjustments relating to prior years ( 22,019 ) — 3,294 — ( 18,725 ) Payments/credits relating to sales in current year ( 237,521 ) ( 252,896 ) — ( 48,834 ) ( 539,251 ) Payments/credits relating to sales in prior years ( 157,622 ) ( 26,387 ) ( 13,792 ) ( 11,601 ) ( 209,402 ) Ending balance — December 31, 2022 $ 226,741 $ 26,175 $ 29,666 $ 7,938 $ 290,520 (1) “Contractual Adjustments” include “Medicaid Rebates” and “Medicare Part D” accruals (2) “Discounts” in clude “Chargebacks” and “Product Discounts” Total revenue-related reserves as of December 31, 2024 and 2023, included in our consolidated balance sheets, are summarized as follows: F- 11 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Year Ended December 31, (In thousands) 2024 2023 Reduction of accounts receivable $ 22,031 $ 11,510 Components of accrued sales discounts, allowances and reserves 272,452 263,641 Components of other long-term liabilities 41,944 39,181 Total revenue-related reserves $ 336,427 $ 314,332 Collaborative Arrangements The Company has entered into collaborative arrangements with pharmaceutical companies including, among others, Janssen Pharmaceuticals, Inc. (“Janssen, Inc.”), Janssen Pharmaceutica International, a division of Cilag International AG (“Janssen International”), and Janssen Pharmaceutica N.V. (together with Janssen, Inc., Janssen International and their affiliates, “Janssen”) related to INVEGA SUSTENNA ® /XEPLION ® , INVEGA TRINZA ® /TREVICTA ® , INVEGA HAFYERA ® /BYANNLI ® (collectively, the “long-acting INVEGA products”) and RISPERDAL CONSTA ® , and Biogen International GmbH (together with its affiliates, “Biogen”) related to VUMERITY ® . Substantially all of the products developed under these arrangements are currently being marketed as approved products for which the Company received or receives payments for manufacturing services and/or royalties on net product sales. Manufacturing Revenue The Company recognizes manufacturing revenues from the sale of products it manufactures for resale by its licensees. Substantially all of the manufacturing revenues are recognized at a point in time when control of the product passes to the licensee. The sales price for certain of the Company’s manufacturing revenues is based on the end-market sales price earned by its licensees. As end-market sales generally occur after the Company has recorded manufacturing revenue, the Company estimates the sales price for such products based on information supplied to it by the Company’s licensees, its historical transaction experience and other third-party data. Differences between actual manufacturing revenues and estimated manufacturing revenues are reconciled and adjusted for in the period in which they become known, which is generally within the same quarter. The differences between the Company’s actual and estimated manufacturing revenues have not been material to date. Royalty Revenue The Company recognizes royalty revenues related to the sale by its licensees of products that incorporate the Company’s technologies. All of the Company’s royalties qualify for the sales-and-usage exemption under Topic 606 as (i) such royalties are based strictly on the sales-and-usage by the licensee; and (ii) a license of IP is the sole or predominant item to which such royalties relate. Based on this exemption, these royalties are earned in the period that the products are sold by the Company’s licensee and the Company has a present right to payment. Certain of the Company’s royalty revenues are recognized by the Company based on information supplied to the Company by its licensees and require estimates to be made. Differences between actual royalty revenues and estimated royalty revenues are reconciled and adjusted for in the period in which they become known, which is generally within the same quarter. The differences between the Company’s actual and estimated royalty revenues have not been material to date. Receivables, net Receivables, net, include amounts billed and amounts unbilled but currently unconditionally due from customers. The amounts due are stated at their net estimated realizable value. The Company’s unbilled receivable balance was $ 69.5 million and $ 103.1 million at December 31, 2024 and 2023, respectively, and related primarily to royalty revenue. The Company maintains an allowance for doubtful accounts to provide for the estimated amounts of receivables that will not be collected. The allowance is based upon an assessment of customer creditworthiness, historical payment experience, the age of outstanding receivables and collateral to the extent applicable. The Company’s allowance for doubtful accounts was approximately $ 0.3 million and $ 0.2 million at December 31, 2024 and 2023, respectively. Contract Assets Contract assets include unbilled amounts that will result in a sale under certain of the Company’s manufacturing contracts. The amounts included in the contract assets table below are classified as “Current assets” in the accompanying consolidated balance sheets, as they relate to manufacturing processes that are completed in ten days to eight weeks . F- 12 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Contract assets consisted of the following: (In thousands) Contract Assets Contract assets at January 1, 2023 $ 8,929 Additions 13,606 Transferred to receivables, net ( 21,829 ) Contract assets at December 31, 2023 $ 706 Additions 6,615 Transferred to receivables, net ( 2,331 ) Contract assets at December 31, 2024 $ 4,990 Contract Liabilities Contract liabilities consist of contractual obligations related to deferred revenue. At December 31, 2024 and 2023, $ 1.2 million and $ 2.7 million of the contract liabilities, respectively, were classified as “Contract liabilities–short-term” in the accompanying consolidated balance sheets and none and $ 2.1 million of the contract liabilities, respectively, were classified as “Other long-term liabilities” in the accompanying consolidated balance sheets. Contract liabilities consisted of the following: (In thousands) Contract Liabilities Contract liabilities at January 1, 2023 $ 10,701 Additions ( 931 ) Amounts recognized into revenue ( 4,995 ) Contract liabilities at December 31, 2023 $ 4,775 Additions 34 Amounts recognized into revenue ( 3,560 ) Contract liabilities at December 31, 2024 $ 1,249 Foreign Currency The Company’s functional and reporting currency is the U.S. dollar. Transactions in foreign currencies are recorded at the exchange rate prevailing on the date of the transaction. The resulting monetary assets and liabilities are translated into U.S. dollars at exchange rates prevailing on the subsequent balance sheet date. Gains and losses as a result of translation adjustments are recorded within “Other income (expense), net” in the accompanying consolidated statements of operations and comprehensive income (loss). During the years ended December 31, 2024, 2023 and 2022, the Company recorded losses of $ 0.8 million and $ 0.5 million and a gain of $ 0.7 million, respectively, on foreign currency translation. Concentrations Financial instruments that potentially subject the Company to concentrations of credit risk are receivables and marketable securities. Billings to large pharmaceutical companies and pharmaceutical wholesalers account for the majority of the Company’s receivables, and collateral is not required from these customers. To mitigate credit risk, the Company monitors the financial performance and credit-worthiness of its customers. The following represents revenue and receivables from the Company’s customers exceeding 10 % of the total in each category as of, and for the years ended, December 31, 2024, 2023 and 2022: Year Ended December 31, 2024 2023 2022 Customer Receivables Revenue Receivables Revenue Receivables Revenue McKesson 36 % 25 % 14 % 14 % 12 % 16 % Cencora 17 % 15 % 16 % 12 % 18 % 14 % Cardinal Health 16 % 19 % 24 % 20 % 24 % 24 % Janssen 14 % 17 % 23 % 31 % * 15 % Biogen * 11 % * 11 % 19 % 13 % * Indicates the revenues or receivables for the customer did not exceed 10 % of the Company’s total in each category as of or for the years ended December 31, 2024, 2023 and 2022, as noted. F- 13 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The Company holds its interest-bearing investments with major financial institutions and, in accordance with documented investment policies, the Company limits the amount of credit exposure to any one financial institution or corporate issuer. The Company’s investment objectives are, first, to ensure liquidity and conservation of capital and, second, to generate investment income. Geographic Information Company revenues by geographic location for the years ended December 31, 2024, 2023 and 2022, as determined by the location of the customer, are as follows: Year Ended December 31, (In thousands) 2024 2023 2022 Revenue by region: U.S. $ 1,410,159 $ 1,491,939 $ 931,991 Ireland 1,294 1,179 1,829 Rest of world 146,179 170,287 177,975 The location of the Company’s assets are as follows: December 31, (In thousands) 2024 2023 Assets by region: Current assets: U.S.: Cash and cash equivalents $ 70,303 $ 317,850 Investments—short-term 203,631 187,574 Receivables, net 306,259 218,747 Other current assets 129,332 143,417 Ireland: Cash and cash equivalents $ 220,843 $ 139,619 Investments—short-term 256,891 128,448 Receivables, net 78,269 113,730 Assets held for sale — 94,260 Other current assets 149,827 141,861 Long-term assets: U.S.: Property, plant and equipment, net $ 226,646 $ 225,578 Investments—long-term 24,629 17,957 Other 210,792 189,335 Ireland: Property, plant and equipment, net $ 918 $ 1,365 Investments—long-term 48,519 21,930 Intangible assets, net and goodwill 83,917 85,018 Other 44,791 109,534 Research and Development Expenses For each of its R&D programs, the Company incurs both external and internal expenses. External R&D expenses include fees related to clinical and preclinical activities performed by contract research organizations, consulting fees and costs related to laboratory services, purchases of drug product materials and third-party manufacturing development costs. Internal R&D expenses include employee-related expenses, occupancy costs, depreciation and general overhead. The Company tracks external R&D expenses for each of its development programs, however, internal R&D expenses are not tracked by individual program as they benefit multiple development programs or the Company’s products or technologies in general. Selling, General and Administrative Expenses Selling, general and administrative (“SG&A”) expenses are primarily comprised of employee-related expenses associated with selling and marketing, finance, human resources, legal, information technology and other administrative personnel, outside marketing, advertising, financial and legal expenses and other general and administrative costs. F- 14 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Advertising costs are expensed as incurred. During the years ended December 31, 2024, 2023 and 2022, advertising costs totaled $ 107.6 million, $ 127.6 million and $ 41.4 million, respectively. Share-Based Compensation The Company’s share-based compensation programs permit grants of awards in the form of stock options and restricted stock unit awards (“RSUs”), which vest with the passage of time and/or based on the achievement of certain performance criteria. The Company issues new shares upon the exercise of stock options or the vesting of RSUs. Under the terms of the Company’s stock option and incentive plans (the “Plans”), the Company’s employees may, at the discretion of the plan administrator, become eligible in certain circumstances set forth in the Plans for accelerated vesting of certain awards granted to them under the Plans. In such circumstances, if there are no effective future service requirements for such employees, the remaining fair value of any such accelerated awards would be expensed as of the date of acceleration. Time-Based Stock Options Except as otherwise provided in the applicable Plan or award certificate, stock option grants to employees expire ten years from the date of grant and generally vest in four equal annual installments, commencing on the first anniversary of the date of grant, provided the employee remains continuously employed or in a service relationship with the Company during the applicable vesting period. Except as otherwise provided in the applicable Plan or Award Certificate (as defined in the 2018 Plan): (i) annual stock option grants to non-employee directors expire ten years from the date of grant and generally vest over a one-year period; and (ii) stock option grants to new non-employee directors expire ten years from the date of grant and generally vest over a three-year period. The estimated fair value of options is recognized over the requisite service period, which is generally the vesting period. Share-based compensation expense is based on awards ultimately expected to vest. Forfeitures are estimated based on historical experience at the time of grant and revised in subsequent periods if actual forfeitures differ from those estimates. The fair value of stock option grants is based on estimates as of the date of grant using a Black-Scholes option valuation model. The Company uses historical data as the basis for estimating stock option terms and forfeitures. Separate groups of employees that have similar historical stock option exercise and forfeiture behavior are considered separately for valuation purposes. The ranges of expected terms disclosed below reflect different expected behavior among certain groups of employees. Expected stock volatility factors are based on a weighted average of implied volatilities from traded options of the Company’s ordinary shares and historical share price volatility of the Company’s ordinary shares, which is determined based on a review of the weighted average of historical weekly price changes of the Company’s ordinary shares. The risk-free interest rate for periods commensurate with the expected term of the stock option is based on the U.S. treasury yield curve in effect at the time of grant. The dividend yield on the Company’s ordinary shares is estimated to be zero as the Company has not paid dividends and does not expect to pay dividends in the near future. The exercise price of options granted is equal to the closing price of the Company’s ordinary shares traded on the Nasdaq Global Select Market on the date of grant. The fair value of each stock option granted was estimated on the grant date with the following weighted-average assumptions: Year Ended December 31, 2024 2023 2022 Expected option term 5 - 7 years 5 - 8 years 5 - 8 years Expected stock volatility 38 % - 42 % 40 % - 44 % 43 % - 51 % Risk-free interest rate 3.64 % - 4.60 % 3.34 % - 4.75 % 1.83 % - 4.26 % Expected annual dividend yield — — — Time-Based Restricted Stock Unit Awards Except as otherwise provided in the applicable Plan or award certificate, time-based RSUs awarded to employees generally vest in four equal annual installments, commencing on the first anniversary of the date of grant, provided the employee remains continuously employed or in a service relationship with the Company during the applicable vesting period. Shares subject to these RSUs are delivered to the employee upon vesting, subject to payment of applicable withholding taxes. The fair value of time-based RSUs is equal to the closing price of the Company’s ordinary shares traded on the Nasdaq Global Select Market on the date of grant. Compensation expense, including the effect of forfeitures, is recognized over the applicable service period. F- 15 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Performance-Based Restricted Stock Unit Awards Performance-based RSUs awarded to employees vest upon the achievement of certain performance criteria, typically during or following the end of a specified performance period. The estimated fair value of these performance-based RSUs are generally based on the closing price of the Company’s ordinary shares traded on the Nasdaq Global Select Market on the date of grant, unless the performance-based RSU is also subject to a market condition. In that case, the fair value of the performance-based RSU is based on a Monte Carlo simulation model. Compensation expense for performance-based RSUs is recognized from the date the Company determines the performance criteria probable of being achieved to the date the award, or relevant portion of the award, is expected to vest. Cumulative adjustments are recorded on a quarterly basis to reflect subsequent changes to the estimated outcome of the performance criteria until the date that the final outcome of the performance criteria is determined. Income Taxes The Company recognizes income taxes under the asset and liability method. Deferred income taxes are recognized for differences between the financial reporting and tax bases of assets and liabilities at enacted statutory tax rates in effect for the years in which the differences are expected to reverse. The effect on deferred taxes of a change in tax rates is recognized in income in the period that includes the enactment date. In evaluating the Company’s ability to recover its deferred tax assets, the Company considers all available positive and negative evidence including its past operating results, the existence of cumulative income in the most recent fiscal years, changes in the business in which the Company operates and its forecast of future taxable income. In determining future taxable income, the Company is responsible for assumptions utilized including the amount of Irish and non-Irish pre-tax operating income, the reversal of temporary differences and the implementation of feasible and prudent tax planning strategies. These assumptions require significant judgment about the forecasts of future taxable income and are consistent with the plans and estimates that the Company is using to manage the underlying business. The Company accounts for uncertain tax positions using a more-likely-than-not threshold for recognizing and resolving uncertain tax positions. The evaluation of uncertain tax positions is based on factors including, but not limited to, changes in tax law, the measurement of tax positions taken or expected to be taken in tax returns, the effective settlement of matters subject to audit, new audit activity and changes in facts or circumstances related to a tax position. The Company evaluates its tax position on a quarterly basis. The Company also accrues for potential interest and penalties related to unrecognized tax benefits in income tax expense. Comprehensive Income (Loss) Comprehensive income (loss) consists of net income (loss) and other comprehensive income (loss). Other comprehensive income (loss) includes changes in equity that are excluded from net income (loss), such as unrealized holding gains and losses on available-for-sale investments. Earnings (Loss) Per Share Basic earnings (loss) per ordinary share from continuing operations is calculated based upon net income (loss) from continuing operations available to holders of ordinary shares divided by the weighted average number of ordinary shares outstanding. Basic loss per ordinary share from discontinued operations is calculated based upon net loss from discontinued operations available to holders of ordinary shares, divided by the weighted average number of ordinary shares outstanding. For the calculation of diluted earnings (loss) per ordinary share from continuing operations and discontinuing operations, the Company utilizes the treasury stock method and adjusts the weighted average number of ordinary shares outstanding for the potential dilutive effect of outstanding ordinary share equivalents such as stock options and RSUs. Segment Information In November 2023, the FASB issued Accounting Standards Update (“ASU”) 2023-07, Segment Reporting: Improvements to Reportable Segment Disclosure (“Topic 280”) to establish standards for reporting information about operating segments. Operating segments are defined as components of an enterprise engaging in business activities for which separate financial information is available and regularly reviewed by the chief operating decision maker (“CODM”) in deciding how to allocate resources and in assessing performance. The Company has utilized the management approach to determine that the Company is managed as one segment on a consolidated basis and is the business of developing, manufacturing and commercializing medicines designed to address unmet medical needs of patients in major therapeutic areas. The Company’s CODM, the Chairman and Chief Executive Officer, reviews the Company’s operating results on an aggregate basis and manages the Company’s operations as a single operating unit. The CODM measures profitability on a reportable segment basis using net income (loss) and utilizes this information in allocating resources and in assessing performance by monitoring budget versus actual results. Please refer to Note 18, Segment Reporting , in these “Notes to Consolidated Financial Statements” in this Annual Report for further information. F- 16 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Employee Benefit Plans 401(k) Plan The Company maintains a 401(k) retirement savings plan (the “401(k) Plan”), which covers all of its eligible U.S.-based employees. Eligible employees may contribute up to 100 % of their eligible compensation, subject to certain Internal Revenue Service (“IRS”) limitations. The Company matches 100 % of employee contributions up to the first 5 % of employee pay, up to IRS limits. Employee and Company contributions are fully vested when made. During the years ended December 31, 2024, 2023 and 2022, the Company contributed $ 15.1 million, $ 15.0 million and $ 14.4 million, respectively, to match employee deferrals under the 401(k) Plan. Defined Contribution Plan The Company maintains a defined contribution plan for its Ireland-based employees (the “Defined Contribution Plan”). The Defined Contribution Plan provides for eligible employees to contribute up to a maximum of 40 %, depending upon their age, of their total taxable earnings subject to an earnings cap of € 115,000 . The Company provides a match of up to 18 % of taxable earnings depending upon an individual’s contribution level. During the years ended December 31, 2024, 2023 and 2022, the Company contributed $ 3.4 million, $ 5.6 million and $ 5.1 million, respectively, in contributions to the Defined Contribution Plan. New Accounting Pronouncements From time to time, new accounting pronouncements are issued by the FASB or other standard-setting bodies that are adopted by the Company as of the specified effective date. Unless otherwise discussed, the Company believes that the impact of recently issued standards that are not yet effective will not have a material impact on its financial position or results of operations upon adoption. In December 2023, the FASB issued ASU 2023-09, Income Taxes (“Topic 740”) : Improvements to Income Tax Disclosures, to enhance the transparency and decision usefulness of income tax disclosures in order to provide information to assist key stakeholders in better assessing how the Company’s operations and related tax risks and tax planning and operational opportunities affect the Company’s tax rate and prospects for future cash flows. This ASU becomes effective for public companies for annual periods beginning after December 15, 2024. Early adoption is permitted for annual financial statements that have not yet been issued or made available for issuance. This guidance will be applied on a prospective basis. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements and related disclosures. In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income-Expense Disaggregation Disclosures , to improve disclosures about a public business entity’s expenses and address requests from investors for more detailed information about the types of expenses (including purchases of inventory, employee compensation, depreciation, amortization and depletion) in commonly-presented expense captions, such as cost of sales, selling, general and administrative expenses, and research and development. All disclosure requirements under this guidance are required for public business entities and effective for annual periods beginning after December 15, 2026 and interim periods beginning after December 15, 2027. Early adoption is permitted and the amendments in this guidance will be applied prospectively to financial statements for periods after the effective dates. The Company is currently evaluating the impact this ASU will have on its consolidated financial statements and related disclosures. 3. DISCONTINUED OPERATIONS Mural Oncology Separation In November 2023, the Company completed the Separation. In connection with the Separation, the Company entered into a separation agreement with Mural, dated as of November 13, 2023, that, among other things, set forth the Company’s agreements with Mural regarding the principal actions taken or to be taken in connection with the Separation, including the Distribution. The separation agreement identified those assets to be transferred to, liabilities to be assumed by and contracts to be assigned to Mural, including the operating lease for the office and laboratory space at 852 Winter Street in Waltham, Massachusetts, as part of the Separation, and it provided for when and how such transfers, assumptions and assignments were to occur. The purpose of the separation agreement was to provide Mural and the Company with those assets necessary to operate their respective businesses and to retain or assume the respective liabilities related to those assets. Each of Mural and the Company agreed to releases with respect to pre-Distribution claims, and cross-indemnities with respect to post-Distribution claims, that are principally designed to place financial responsibility for the obligations and liabilities allocated to Mural under the separation agreement with Mural, and financial responsibility for the obligations and liabilities allocated to the Company under the separation agreement with the Company. The Company and Mural are also each subject to mutual six-month employee non-solicitation and non-hire restrictions, subject to certain customary exceptions, and certain confidentiality restrictions and information sharing obligations. F- 17 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The transfer of assets and liabilities to Mural was effected through a contribution in accordance with the separation agreement, as summarized below: (In thousands) November 15, 2023 ASSETS Current Assets: Cash and cash equivalents $ 275,000 Total current assets 275,000 Property, plant and equipment, net 10,096 Right-of-use assets 14,513 Goodwill 7,800 Deferred tax asset 1,799 Total assets $ 309,208 LIABILITIES Current Liabilities: Operating lease liabilities—short-term $ 6,036 Total current liabilities 6,036 Operating lease liabilities—long-term 9,412 Total liabilities 15,448 Net assets transferred to Mural $ 293,760 The Company determined that the Separation and related Distribution qualified as tax-free for U.S. federal income tax purposes, which required significant judgment by management. In making such determinations, the Company applied U.S. federal tax law to relevant facts and circumstances and obtained: (i) a favorable private letter ruling from the IRS; (ii) a tax opinion; and (iii) other external tax advice related to the concluded tax treatment. If the Separation and Distribution were to ultimately fail to qualify for tax-free treatment for U.S. federal income tax purposes, the Company and/or its shareholders could be subject to significant liabilities, which could have material adverse impacts on the Company’s business, financial condition, results of operations and cash flows in future reporting periods. Furthermore, other than taxes recorded on the transfer of intellectual property, the Company determined that the Separation and related Distribution qualified as tax-free for Irish tax purposes, which required significant judgment by management. In making such determinations, the Company applied Irish tax law to relevant facts and circumstances and obtained: (i) a tax opinion; and (ii) other external tax advice related to the concluded tax treatment. If the Separation and Distribution were to ultimately fail to qualify for tax-free treatment for Irish tax purposes, the Company and/or its shareholders could be subject to significant liabilities, which could have material adverse impacts on the Company’s business, financial condition, results of operations and cash flows in future reporting periods. In connection with the Separation, the Company also entered into a tax matters agreement with Mural, dated as of November 13, 2023 . The tax matters agreement governs the Company’s and Mural’s respective rights, responsibilities and obligations with respect to taxes (including taxes arising in the ordinary course of business and taxes, if any, incurred as a result of any failure of the Distribution, together with certain related transactions, to qualify as tax-free for U.S. federal income tax purposes), tax attributes, the preparation and filing of tax returns, the control of audits and other tax proceedings, and assistance and cooperation in respect of tax matters. In connection with the Separation, the Company also entered into the Employee Matters Agreement. The Employee Matters Agreement, as amended, governs the Company’s, Mural’s and their respective subsidiaries’ and affiliates’ rights, responsibilities and obligations after the Separation with respect to, employment, benefits and compensation matters relating to employees and former employees (and their respective dependents and beneficiaries) who are or were associated with the Company, including those who became employees of Mural in connection with the Separation; the allocation of assets and liabilities generally relating to employees, employment or service-related matters and employee benefit plans; other human resources, employment and employee benefits matters; and the treatment of equity-based awards granted by the Company prior to the Separation. Discontinued Operations The results of the former oncology business and transaction costs related to the Separation have been reflected as “Loss from discontinued operations, net of taxes” in the accompanying consolidated statement of operations and comprehensive income (loss) through the Separation Date. Prior periods have been recast to reflect this presentation. The transaction costs related to the Separation were $ 36.0 million during 2023 and $ 1.4 million during 2022, and primarily relate to professional fees for separation activities within the finance, tax, legal and information technology functions. F- 18 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The following table summarizes expenses of the discontinued operations for the years ended December 31, 2024, 2023 and 2022: Year Ended December 31, (In thousands) 2024 2023 2022 Operating expenses from discontinued operations Cost of goods manufactured $ — $ 39 $ 40 Research and development 5,790 116,177 121,140 Selling, general and administrative — 48,587 14,996 Total operating expenses from discontinued operations 5,790 164,803 136,176 Operating loss from discontinued operations ( 5,790 ) ( 164,803 ) ( 136,176 ) Income tax benefit from discontinued operations ( 722 ) ( 1,403 ) ( 11,061 ) Net loss and comprehensive loss from discontinued operations $ ( 5,068 ) $ ( 163,400 ) $ ( 125,115 ) There were no assets and $ 4.5 million of liabilities related to the Separation as of December 31, 2023. All assets were transferred to Mural as of the Separation Date. The $ 4.5 million of liabilities classified as “Liabilities related to discontinued operations” in the accompanying consolidated balance sheet as of December 31, 2023 related to bonus amounts accrued for employees that transferred to Mural during 2023 through the Separation Date that were paid by the Company in the first quarter of 2024, in accordance with the terms of the employee matters agreement entered into between the Company and Mural. The following table summarizes the significant non-cash items and capital expenditures of the discontinued operations that are included in the consolidated statements of cash flows for the years ended December 31, 2023 and 2022: Year Ended December 31, (In thousands) 2023 2022 OPERATING ACTIVITIES: Depreciation $ 2,319 $ 1,539 Share-based compensation expense 8,188 6,577 Right-of-use assets 3,803 5,909 Operating lease liabilities ( 3,938 ) ( 5,920 ) INVESTING ACTIVITIES: Additions of property, plant and equipment $ ( 1,798 ) $ ( 5,510 ) 4. REVENUE FROM CONTRACTS WITH CUSTOMERS During the years ended December 31, 2024, 2023 and 2022, the Company recorded product sales, net, as follows: Year Ended December 31, (In thousands) 2024 2023 2022 VIVITROL $ 457,315 $ 400,419 $ 379,478 ARISTADA and ARISTADA INITIO 346,187 327,690 302,052 LYBALVI 280,032 191,889 96,022 Total product sales, net $ 1,083,534 $ 919,998 $ 777,552 F- 19 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) During the years ended December 31, 2024, 2023 and 2022, the Company recorded manufacturing and royalty revenues from its collaboration arrangements as follows: Year Ended December 31, 2024 (In thousands) Manufacturing Revenue Royalty Revenue Total Long-acting INVEGA products (1) $ — $ 236,386 $ 236,386 VUMERITY 39,292 94,755 134,047 RISPERDAL CONSTA 23,172 272 23,444 Other 56,962 23,256 80,218 $ 119,426 $ 354,669 $ 474,095 Year Ended December 31, 2023 (In thousands) Manufacturing Revenue Royalty Revenue Total Long-acting INVEGA products (1) $ — $ 486,101 $ 486,101 VUMERITY 42,886 86,440 129,326 RISPERDAL CONSTA 36,123 1,153 37,276 Other 63,489 27,196 90,685 $ 142,498 $ 600,890 $ 743,388 Year Ended December 31, 2022 (In thousands) Manufacturing Revenue Royalty Revenue Total Long-acting INVEGA products (1) $ — $ 115,655 $ 115,655 VUMERITY 32,493 83,003 115,496 RISPERDAL CONSTA 42,670 7,243 49,913 Other 37,211 13,708 50,919 $ 112,374 $ 219,609 $ 331,983 (1) “long-acting INVEGA products”: INVEGA SUSTENNA/XEPLION (paliperidone palmitate), INVEGA TRINZA/TREVICTA (paliperidone palmitate) and INVEGA HAFYERA/BYANNLI (paliperidone palmitate). In November 2021, the Company received notice of partial termination of an exclusive license agreement with Janssen. Under this license agreement, the Company provided Janssen with rights to, and know-how, training and technical assistance in respect of, the Company’s small particle pharmaceutical compound technology, known as NanoCrystal technology, which was used to develop the long-acting INVEGA products. When the partial termination became effective in February 2022, Janssen ceased paying royalties related to sales of INVEGA SUSTENNA, INVEGA TRINZA and INVEGA HAFYERA. Accordingly, the Company ceased recognizing royalty revenue related to sales of these products in February 2022. In April 2022, the Company commenced binding arbitration proceedings related to, among other things, Janssen’s partial termination of this license agreement and Janssen’s royalty and other obligations under the agreement. In May 2023, the arbitral tribunal (the “Tribunal”) in the arbitration proceedings issued a final award (the “Final Award”) which concluded the arbitration proceedings. The Final Award provided, among other things, that the Company was due back royalties of $ 195.4 million, inclusive of $ 8.1 million in late-payment interest related to 2022 U.S. net sales of the long-acting INVEGA products, which amount the Company received from Janssen in the second quarter of 2023, and is entitled to 2023 and future royalty revenues from Janssen related to net sales of INVEGA SUSTENNA through August 20, 2024, INVEGA TRINZA through the second quarter of 2030 (but no later than May 2030 when the license agreement expires) and INVEGA HAFYERA through May 2030 (when the license agreement expires). Following issuance of the Final Award, the Company recognized royalty revenues related to the back royalties noted above and resumed recognizing royalty revenue related to ongoing U.S. sales of the long-acting INVEGA products. During 2023, the Company recor ded $ 486.1 mill ion in royalty revenue from sales of the long-acting INVEGA products, including $ 195.4 million related to back royalties and associated interest related to net sales of the long-acting INVEGA in the U.S. in 2022 and resumed recognizing royalty revenue related to worldwide net sales of the long-acting INVEGA products of approximately $ 290.7 million, as compared to royalty revenue of $ 115.7 million during 2022. In October 2022 and November 2022, an arbitration panel found that the Company must return to Acorda Therapeutics, Inc. (“Acorda”) $ 16.5 million (inclusive of prejudgment interest and administrative fees) and $ 1.8 million (inclusive of prejudgment interest), respectively, previously paid by Acorda under a license agreement between the Company and Acorda. These amounts F- 20 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) represented a portion of the royalty revenue paid to the Company by Acorda since July 2020 related to AMPYRA. The Company paid Acorda the aggregate $ 18.3 million in the fourth quarter of 2022. In addition, during the three months ended June 30, 2022, the Company had recorded $ 3.2 million of royalty revenue related to AMPYRA as the Company believed that it had met the necessary revenue recognition criteria under Topic 606. However, as a result of the arbitration ruling, the Company reversed the $ 3.2 million as the panel found that the Company was no longer entitled to be paid those royalties. During the three months ended September 30, 2022, the Company recorded both the $ 18.3 million in repayments and the $ 3.2 million reversal as reversals of royalty revenue within “Manufacturing and royalty revenue” in the accompanying consolidated statements of operations and comprehensive income (loss). The amounts related to such arbitration ruling were included as part of “Other” within the manufacturing and royalty revenue table above for the year ended December 31, 2022. As a result of the arbitration ruling, the Company has no contractual obligation to manufacture and supply AMPYRA or contractual right to receive future manufacturing or royalty revenue related to AMPYRA. Refer to Note 19, Commitments and Contingent Liabilities within the “Notes to Consolidated Financial Statements” in this Annual Report for information regarding additional legal proceedings related to the arbitration with Acorda. 5. INVESTMENTS Investments consist of the following: Gross Unrealized Losses Amortized Less than Greater than Estimated December 31, 2024 Cost Gains One Year One Year Fair Value Short-term investments: Available-for-sale securities: U.S. government and agency debt securities $ 266,506 $ 763 $ ( 58 ) $ ( 6 ) $ 267,205 Corporate debt securities 192,617 762 ( 58 ) (4 ) 193,317 Total short-term investments 459,123 1,525 ( 116 ) ( 10 ) 460,522 Long-term investments: Available-for-sale securities: U.S. government and agency debt securities 48,856 — — ( 179 ) 48,677 Corporate debt securities 24,484 — — ( 158 ) 24,326 73,340 — — ( 337 ) 73,003 Held-to-maturity securities: Certificates of deposit 145 — — — 145 Total long-term investments 73,485 — — ( 337 ) 73,148 Total investments $ 532,608 $ 1,525 $ ( 116 ) $ ( 347 ) $ 533,670 December 31, 2023 Short-term investments: Available-for-sale securities: U.S. government and agency debt securities $ 199,708 $ 758 $ ( 36 ) $ ( 611 ) $ 199,819 Corporate debt securities 112,055 703 ( 15 ) ( 536 ) 112,207 Non-U.S. government debt securities 4,004 — — ( 8 ) 3,996 Total short-term investments 315,767 1,461 ( 51 ) ( 1,155 ) 316,022 Long-term investments: Available-for-sale securities: U.S. government and agency debt securities 19,392 — ( 27 ) ( 315 ) 19,050 Corporate debt securities 19,306 — — ( 289 ) 19,017 38,698 — ( 27 ) ( 604 ) 38,067 Held-to-maturity securities: Certificates of deposit 1,820 — — — 1,820 Total long-term investments 40,518 — ( 27 ) ( 604 ) 39,887 Total investments $ 356,285 $ 1,461 $ ( 78 ) $ ( 1,759 ) $ 355,909 At December 31, 2024, the Company reviewed its investment portfolio to assess whether the unrealized losses on its available-for-sale investments were temporary. Investments with unrealized losses consisted primarily of corporate debt securities and debt securities issued and backed by U.S. agencies and the U.S. government. At December 31, 2024, 77 of the Company’s 320 investment securities were in an unrealized loss position and had an aggregate estimated fair value of $ 112.7 million. Approximately 41 % and 59 % of the Company’s investment securities at December 31, 2024 were in corporate debt securities, with a minimum rating of A2 F- 21 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) (Moody’s)/A (Standard and Poor’s), and debt securities issued by the U.S. government or its agencies, respectively. The primary reason for the unrealized losses in the Company’s investment portfolio is that its investments are fixed-rate securities acquired in a rising interest rate environment. In making the determination whether the decline in fair value of these securities was temporary, the Company evaluated whether it intended to sell the security and whether it was more likely than not that the Company would be required to sell the security before recovering its amortized cost basis. The Company has the intent and ability to hold these investments until recovery, which may be at maturity. Realized gains and losses on the sales and maturities of investments, which were identified using the specific identification method, were as follows: Year Ended December 31, (In thousands) 2024 2023 2022 Proceeds from the sales and maturities of investments $ 310,286 $ 355,522 $ 281,627 Realized gains $ — $ — $ — Realized losses $ — $ — $ 529 The Company’s available-for-sale and held-to-maturity securities at December 31, 2024 had contractual maturities in the following periods: Available-for-sale Held-to-maturity Amortized Estimated Amortized Estimated (In thousands) Cost Fair Value Cost Fair Value Within 1 year $ 324,897 $ 325,566 $ 145 $ 145 After 1 year through 5 years 207,566 207,959 — — Total $ 532,463 $ 533,525 $ 145 $ 145 6. FAIR VALUE The following table presents information about the Company’s assets and liabilities that are measured at fair value on a recurring basis and indicates the fair value hierarchy and the valuation techniques the Company utilized to determine such fair value: December 31, (In thousands) 2024 Level 1 Level 2 Level 3 Assets: Cash equivalents $ 8,388 $ 8,388 $ — $ — U.S. government and agency debt securities 315,882 265,090 50,792 — Corporate debt securities 217,643 — 217,643 — Total $ 541,913 $ 273,478 $ 268,435 $ — December 31, 2023 Level 1 Level 2 Level 3 Assets: Cash equivalents $ 34,316 $ 34,316 $ — $ — U.S. government and agency debt securities 218,869 181,041 37,828 — Corporate debt securities 131,224 — 131,224 — Non-U.S. government debt securities 3,996 — 3,996 — Total $ 388,405 $ 215,357 $ 173,048 $ — The Company transfers its financial assets and liabilities, measured at fair value on a recurring basis, between the fair value hierarchies at the end of each reporting period. There were no transfers of any securities between levels during the year ended December 31, 2024. At December 31, 2024, the Company had no investments with fair values that were determined using Level 3 inputs. The Company’s investments in U.S. government and agency debt securities, non-U.S. government agency debt securities and corporate debt securities classified as Level 2 within the fair value hierarchy were initially valued at the transaction price and subsequently valued, at the end of each reporting period, utilizing market-observable data. The market-observable data included reportable trades, benchmark yields, credit spreads, broker/dealer quotes, bids, offers, current spot rates and other industry and economic events. The Company validated the prices developed using the market-observable data by obtaining market values from other pricing sources, analyzing pricing data in certain instances and confirming that the relevant markets are active. F- 22 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) In April 2015, the Company sold its Gainesville, GA manufacturing facility, the related manufacturing and royalty revenue associated with certain products manufactured at the facility, and the rights to IV/IM and parenteral forms of Meloxicam to Recro Pharma, Inc. (“Recro”) and Recro Gainesville LLC (such transaction the “Gainesville Transaction”). The Gainesville Transaction included in the purchase price contingent consideration tied to low double digit royalties on net sales of the IV/IM and parenteral forms of Meloxicam and any other product with the same active ingredient as Meloxicam IV/IM that is discovered or identified using certain of the Company’s IP to which Recro was provided a right of use, through license or transfer, pursuant to the Gainesville Transaction (such products, the “Meloxicam Products”), and milestone payments upon the achievement of certain regulatory and sales milestones related to the Meloxicam Products. In November 2019, Recro spun out its acute care segment to Baudax Bio, Inc. (“Baudax”), a publicly-traded pharmaceutical company. As part of this transaction, Recro’s obligations to pay certain contingent consideration from the Gainesville Transaction were assigned and/or transferred to Baudax. In Baudax’s Quarterly Report on Form 10-Q for the period ended September 30, 2022, Baudax continued to include disclosures regarding its ability to continue as a going concern, which first appeared in its Annual Report on Form 10-K for the period ended December 31, 2021. In March 2022, Baudax reduced its workforce by approximately 80 %, which was designed to reduce its operational expenses and conserve its cash resources. In light of Baudax’s disclosures and the fact that, as of September 30, 2022, Baudax had only paid $ 1.2 million of the $ 6.4 million that was due to the Company in March 2022, the Company determined, during the three months ended September 30, 2022, that it was unlikely to collect any further proceeds under this arrangement and reduced the fair value of the contingent consideration to zero within “Change in the fair value of contingent consideration” in the accompanying consolidated statements of operations and comprehensive income (loss) for the year ended December 31, 2022. In addition, during the three months ended September 30, 2022, the Company determined that certain construction in progress related to the manufacture of ANJESO ® had no future value and recorded a $ 2.3 million write off within “Other income (expense), net” in the accompanying consolidated statements of operations and comprehensive income (loss) for the year ended December 31, 2022. In December 2022, Baudax announced that it would discontinue the sale of ANJESO and the U.S. Food and Drug Administration (“FDA”) acknowledged the discontinuation of sale of ANJESO via listing in the Orange Book. 7. INVENTORY Inventory consists of the following: December 31, December 31, (In thousands) 2024 2023 Raw materials $ 72,139 $ 71,416 Work in process 79,871 68,843 Finished goods (1) 30,877 46,147 Total inventory $ 182,887 $ 186,406 (1) At December 31, 2024 and 2023, the Company had $ 22.7 million and $ 33.9 million, respectively, of finished goods inventory located at its third-party warehouse and shipping service provider. 8. PROPERTY, PLANT AND EQUIPMENT Property, plant and equipment consists of the following: December 31, December 31, (In thousands) 2024 2023 (1) Land $ 957 $ 957 Building and improvements 134,699 132,735 Furniture, fixtures and equipment 244,113 237,728 Leasehold improvements 42,416 39,893 Construction in progress 58,391 45,791 Subtotal 480,576 457,104 Less: accumulated depreciation ( 253,012 ) ( 230,161 ) Total property, plant and equipment, net $ 227,564 $ 226,943 (1) In connection with the sale of the Athlone Facility, $ 92.2 million of the Company’s property, plant and equipment was classified as “Assets held for sale” in the accompanying consolidated balance sheet at December 31, 2023 and was not included in these amounts. F- 23 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Depreciation expens e was $ 27.4 million, $ 25.7 million and $ 26.3 million for the years ended December 31, 2024, 2023 and 2022, respectively. Also, during the years ended December 31, 2024, 2023 and 2022, the Company wrote off furniture, fixtures and equipment that had an approximate carrying valu e of $ 0.5 million, $ 1.7 million and $ 0.5 million, respectively, at the time of disposition. Amounts included as construction in progress in the consolidated balance sheets primarily include capital expenditures at the Company’s manufacturing facility in Wilmington, Ohio. The Company continues to evaluate its manufacturing capacity based on expectations of demand for its products and will continue to record such amounts within construction in progress until such time as the underlying assets are placed into service. The Company continues to periodically evaluate whether facts and circumstances indicate that the carrying value of its long-lived assets to be held and used may not be recoverable. In December 2023, the Company determined that $ 2.9 million of its construction in progress at its Wilmington, Ohio manufacturing facility had no future value and was written off through “cost of goods manufactured and sold” in the accompanying consolidated statements of operations and comprehensive income (loss) during the year ended December 31, 2023. 9. INTANGIBLE ASSETS AND GOODWILL Intangible assets and goodwill consists of the following: December 31, 2024 December 31, 2023 (In thousands) Weighted Amortizable Life (Years) Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount Goodwill $ 83,027 $ — $ 83,027 $ 83,027 $ — $ 83,027 Finite-lived intangible assets: Collaboration agreements 12 $ 465,590 $ ( 465,590 ) $ — $ 465,590 $ ( 465,590 ) $ — Capitalized IP 11 - 13 118,160 ( 117,270 ) 890 118,160 ( 116,169 ) 1,991 Total $ 583,750 $ ( 582,860 ) $ 890 $ 583,750 $ ( 581,759 ) $ 1,991 In connection with the sale of the Athlone Facility, the Company reviewed Topic 805 and determined that the Athlone Facility constituted a business and, accordingly, $ 2.0 million of the Company’s goodwill was allocated to the Athlone Facility and was classified as “Assets held for sale” in the accompanying consolidated balance sheet as of December 31, 2023. The Company’s finite-lived intangible assets primarily consisted of collaborative agreements and the NanoCrystal and oral controlled release technologies acquired as part of the EDT acquisition. These intangible assets were fully amortized in the year ended December 31, 2024. The Company recorded $ 1.1 million, $ 35.7 million and $ 36.4 million of amortization expense related to its finite-lived intangible assets during the years ended December 31, 2024, 2023 and 2022, respectively. The Company performed its annual goodwill impairment test as of October 31, 2024. The Company elected to perform a qualitative impairment test and determined that based on the weight of all available evidence, the fair value of the reporting unit more-likely-than-not exceeded its carrying value. 10. LEASES All of the Company’s leases are accounted for as operating leases. The Company leases approximately 231,000 square feet of office and laboratory space located at 900 Winter Street in Waltham, Massachusetts (the “900 Winter Street Lease”). The initial term of the lease commenced on January 20, 2020 , expires in 2035 and includes an option to extend the term for an additional ten-year period. On November 13, 2023, in connection with the Separation, Alkermes, Inc., a wholly-owned subsidiary of the Company (“Alkermes US”) and Mural Oncology, Inc., a wholly-owned subsidiary of Mural (“Mural US”) entered into an assignment and assumption of lease agreement (the “Assignment”), pursuant to which Alkermes US assigned to Mural US an operating lease for approximately 180,000 square feet of corporate office space, administrative areas and laboratories located at 852 Winter Street in Waltham, Massachusetts (the “852 Winter Street Lease”). Under the terms of the Assignment, Mural US assumed all of Alkermes US’ obligations under the 852 Winter Street Lease. In accordance with FASB ASC 842, Leases , as the Company can no longer access or direct the use of the asset following the Assignment, the 852 Winter Street Lease no longer meets the definition of a lease for the Company. On November 15, 2023, the effective date of the Assignment, the Company reduced its right-of-use asset and lease liability by $ 14.5 million and $ 15.4 million, respectively in the accompanying consolidated balance sheet. F- 24 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) At December 31, 2024 and 2023, the operating leases held by the Company had a weighted average incremental borrowing rate of 4.0 % and 4.4 %, respectively, and a weighted average remaining lease term of 7.2 years and 8.7 years, respectively. During the years ended December 31, 2024, 2023 and 2022, cash paid for amounts included for the measurement of lease liabilities was $ 10.1 million, $ 10.3 million and $ 27.0 million, respectively. The Company recorded operating lease expense of $ 7.2 million, $ 10.2 million and $ 10.7 million for the years ended December 31, 2024, 2023 and 2022, respectively. Future lease payments under non-cancelable leases as of December 31, 2024 consisted of the following: December 31, (In thousands) 2024 2025 10,189 2026 10,259 2027 9,505 2028 9,574 Thereafter 59,695 Total operating lease payments $ 99,222 Less: imputed interest ( 23,684 ) Total operating lease liabilities $ 75,538 11. ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses consists of the following: December 31, December 31, (In thousands) 2024 2023 Accounts payable $ 45,630 $ 65,649 Accrued compensation 70,960 83,107 Accrued other 68,742 91,805 Total accounts payable and accrued expenses $ 185,332 $ 240,561 A summary of the Company’s current provision for sales discounts, allowances and reserves is as follows: December 31, December 31, (In thousands) 2024 2023 Medicaid rebates $ 202,044 $ 213,845 Product discounts 19,351 15,121 Medicare Part D 26,933 20,569 Other 24,124 14,106 Total accrued sales discounts, allowances and reserves $ 272,452 $ 263,641 Included in accounts payable was approximately $ 11.4 million and $ 34.5 million of amounts payable related to state Medicaid rebates as of December 31, 2024 and 2023, respectively. 12. LONG-TERM DEBT In December 2024, the Company prepaid in full all previously outstanding term loans (the “Former Term Loans”) under the Former Credit Agreement without penalty, through paying off the remaining principal amount due of $ 289.5 million. The Company accounted for such prepayment as a debt extinguishment and recorded a loss of approximately $ 0.8 million within “Other income (expense), net” in the accompanying consolidated statements of operations and comprehensive income (loss) for the year ended December 31, 2024. The Former Term Loans bore interest at the Secured Overnight Financing Rate (“SOFR”) plus a credit spread adjustment applicable to the interest period and an applicable margin of 2.50 % with a floor of 0.5 %. As of December 31, 2024 and 2023, long-term debt consisted of the following: December 31, December 31, (In thousands) 2024 2023 Former Term Loans (due March 12, 2026) $ — $ 290,730 Less: current portion — ( 3,000 ) Long-term debt $ — $ 287,730 F- 25 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 13. EARNINGS (LOSS) PER SHARE Basic earnings (loss) per ordinary share from continuing operations is calculated based upon net income (loss) from continuing operations available to holders of ordinary shares divided by the weighted average number of ordinary shares outstanding. Basic loss per ordinary share from discontinued operations is calculated based upon net loss from discontinued operations available to holders of ordinary shares, divided by the weighted average number of ordinary shares outstanding. For the calculation of diluted earnings (loss) per ordinary share from continuing operations and discontinuing operations, the Company utilizes the treasury stock method and adjusts the weighted average number of ordinary shares outstanding for the potential dilutive effect of outstanding ordinary share equivalents such as stock options and RSUs. Year Ended December 31, (In thousands) 2024 2023 2022 (1) Numerator: Net income (loss) from continuing operations $ 372,138 $ 519,157 $ ( 33,152 ) Net loss from discontinued operations ( 5,068 ) ( 163,400 ) ( 125,115 ) Net income (loss) $ 367,070 $ 355,757 $ ( 158,267 ) Denominator: Weighted average number of ordinary shares outstanding 165,392 166,223 163,742 Effect of dilutive securities: Stock options 1,377 1,093 — Restricted stock unit awards 2,429 2,414 — Dilutive ordinary share equivalents 3,806 3,507 — Shares used in calculating diluted earnings (loss) per ordinary share 169,198 169,730 163,742 (1) Prior period amounts have been retrospectively adjusted to reflect the effects of the Separation. The following potential ordinary share equivalents were not included in the net income (loss) per share calculation because the effect would have been anti-dilutive: Year Ended December 31, (In thousands) 2024 2023 2022 (1) Stock options 11,517 12,422 12,777 Restricted stock unit awards 2,391 2,378 5,040 Total 13,908 14,800 17,817 (1) Prior period amounts have been retrospectively adjusted to reflect the effects of the Separation. 14. SHAREHOLDERS’ EQUITY Share Repurchase Program In February 2024, the Company’s board of directors approved a share repurchase program authorizing the Company to repurchase ordinary shares of the Company in an aggregate amount of up to $ 400.0 million (exclusive of any fees, commissions or other expenses related to such repurchases) from time to time on the open market (the “Repurchase Program”). The specific timing and amounts of repurchases under the Repurchase Program will depend on a variety of factors, including but not limited to ongoing assessments of the Company’s needs, alternative investment opportunities, the market price of the Company’s ordinary shares and general market conditions. The Repurchase Program has no set expiration date and may be suspended or discontinued at any time. During the year ended December 31, 2024, the Company repurchased approximately 7.9 million of its ordinary shares under the Repurchase Program at an average price of $ 25.33 per share, resulting in a total cost, exclusive of any fees, commissions or other expenses related to such repurchase of $ 200.0 million. All ordinary shares repurchased were returned to treasury. As of December 31, 2024, the remaining amount authorized under the Repurchase Program was $ 200.0 million. F- 26 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 15. SHARE-BASED COMPENSATION Share-Based Compensation Expense The following table presents share-based compensation expense from continuing and discontinued operations included in the Company’s consolidated statements of operations and comprehensive income (loss): Year Ended December 31, (In thousands) 2024 2023 2022 Cost of goods manufactured and sold $ 5,798 $ 11,353 $ 10,284 Research and development 28,085 25,753 23,289 Selling, general and administrative 62,754 55,611 54,104 Share-based compensation expense from continuing operations 96,637 92,717 87,677 Cost of goods manufactured and sold — — — Research and development — 3,255 4,652 Selling, general and administrative — 4,933 1,925 Share-based compensation expense from discontinued operations — 8,188 6,577 Total share-based compensation expense $ 96,637 $ 100,905 $ 94,254 During the years ended December 31, 2024, 2023 and 2022, $ 3.1 million, $ 3.2 million and $ 3.3 million, respectively, of share-based compensation expense was capitalized and recorded as “Inventory” in the accompanying consolidated balance sheets. Share-Based Compensation Plans The Company has one share-based compensation plan pursuant to which awards are currently being made: the 2018 Stock Option and Incentive Plan, as amended (the “2018 Plan”). The Company has two share-based compensation plans pursuant to which outstanding awards have been made, but from which no further awards can or will be made: the Alkermes plc Amended and Restated 2008 Stock Option and Incentive Plan, as amended, (the “2008 Plan”) and the Alkermes plc 2011 Stock Option and Incentive Plan, as amended (the “2011 Plan,” and together with the 2018 Plan and the 2008 Plan, the “the Alkermes Stock Option and Incentive Plans”). Effective May 20, 2020, the 2018 Plan was amended such that any shares underlying any outstanding awards granted under the 2011 Plan or the 2008 Plan that are forfeited, canceled, repurchased or otherwise terminated (other than by exercise) from and after such date will become available for issuance pursuant to the 2018 Plan, notwithstanding anything to the contrary in the terms of the 2011 Plan or the 2008 Plan. The 2018 Plan allows for the issuance of non-qualified and incentive stock options, restricted stock, restricted stock unit awards, cash-based awards and performance shares to employees, officers and directors of, and consultants to, the Company in such amounts and with such terms and conditions as may be determined by the compensation committee of the Company’s board of directors, subject to the provisions of the 2018 Plan, as applicable. On May 31, 2024, the Company’s shareholders approved an amended version of the then-current version of the 2018 Plan that served to, among other things, increase the number of ordinary shares authorized for issuance thereunder by 6.3 million. At December 31, 2024, there were 17.9 million ordinary shares available for issuance in the aggregate under the 2018 Plan. The 2018 Plan provides that awards other than stock options will be counted against the total number of shares available under the plan in a 1.8 -to-1 ratio. Stock Options A summary of stock option activity is presented in the following table: Number of Weighted Average Shares Exercise Price Outstanding, January 1, 2024 18,139,903 $ 32.28 Granted 2,615,357 $ 29.48 Exercised ( 1,328,189 ) $ 20.76 Expired ( 1,427,409 ) $ 46.72 Forfeited ( 521,043 ) $ 26.65 Outstanding, December 31, 2024 17,478,619 $ 31.73 Exercisable, December 31, 2024 10,979,663 $ 34.53 F- 27 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The weighted average grant date fair value of stock options granted during the years ended December 31, 2024, 2023 and 2022 was $ 14.08 , $ 13.74 and $ 12.62 , respectively. The aggregate intrinsic value of stock options exercised during the years ended December 31, 2024, 2023 and 2022 was $ 10.9 million, $ 6.0 million and $ 11.6 million, respectively. At December 31, 2024, there were 6.3 million stock options expected to vest, with a weighted average exercise price of $ 26.91 per share, a weighted average contractual remaining life of 7.9 years and an aggregate intrinsic value of $ 15.4 million. At December 31, 2024, the aggregate intrinsic value of stock options exercisable was $ 38.5 million with a weighted average remaining contractual term of 4.4 years. The number of stock options expected to vest was determined by applying the pre-vesting forfeiture rate to the total number of outstanding options. The intrinsic value of a stock option is the amount by which the market value of the underlying shares exceeds the exercise price of the stock option. At December 31, 2024, there was $ 32.3 million of unrecognized share-based compensation expense related to unvested stock options, which is expected to be recognized over a weighted average period of 1.9 years. Time-Based Restricted Stock Unit Awards A summary of time-based RSU activity is presented in the following table: Weighted Average Number of Shares Grant Date Fair Value Unvested, January 1, 2024 5,657,578 $ 24.18 Granted 2,260,345 $ 29.51 Forfeited ( 775,415 ) $ 26.43 Vested ( 2,237,302 ) $ 23.05 Unvested, December 31, 2024 4,905,206 $ 26.80 The weighted average grant date fair values of time-vesting RSUs granted during the years ended December 31, 2024, 2023 and 2022 were $ 29.51 , $ 27.65 and $ 25.27 , respectively. The total fair value of time-vesting RSUs that vested during the years ended December 31, 2024, 2023 and 2022, was $ 51.6 million, $ 63.0 million and $ 54.3 million, respectively. At December 31, 2024, there was $ 53.4 million of total unrecognized share-based compensation expense related to unvested time-vesting RSUs, which will be recognized over a weighted average remaining contractual term of 1.9 years. Performance-Based Restricted Stock Unit Awards In February 2024, 2023 and 2022, the compensation committee of the Company’s board of directors approved the Company’s long-term incentive plans, pursuant to which awards of performance-based RSUs are granted to employees of the Company at the Senior Vice President level and above, in each case subject to vesting based on the achievement of certain financial, commercial and/or R&D performance criteria to be assessed over a performance period of three years from the date of the grant, and subject, at the end of such three-year performance period, to upward or downward adjustment based on a market condition tied to relative share price performance over the three-year performance period. A summary of performance-based RSU activity is presented in the following table: Weighted Average Number of Shares Grant Date Fair Value Unvested, January 1, 2024 1,546,357 $ 27.95 Granted 498,120 $ 32.46 Forfeited ( 172,576 ) $ 25.88 Vested ( 536,243 ) $ 22.21 Unvested, December 31, 2024 1,335,658 $ 32.13 The weighted average grant date fair values of performance-based RSUs granted during the years ended December 31, 2024, 2023 and 2022 were $ 32.46 , $ 29.91 and $ 30.73 , respectively. The total fair value of performance-based RSUs that vested during the years ended December 31, 2024, 2023 and 2022 were $ 10.1 million, $ 5.9 million and none , respectively. At December 31, 2024, there F- 28 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) was $ 3.0 million of unrecognized share-based compensation expense related to unvested performance-based RSUs which would be recognized in accordance with the terms of the awards when the Company deems it probable that the performance criteria will be met. During the year ended December 31, 2024, the Company recognized share-based compensation expense related to certain performance-based RSUs that were granted during 2021. As of December 31, 2023, the financial performance criteria for these awards were deemed not probable of being achieved; however, in February 2024, the compensation committee of the Company’s board of directors determined that the Company partially achieved the financial performance criteria. This was considered a modification in accordance with FASB ASC 718, Compensation—Stock Compensation and resulted in a modification charge of approximately $ 6.8 million. In February 2024 , the compensation committee of the Company’s board of directors also determined that the Company achieved the pipeline performance criteria for these awards, resulting in a $ 2.6 million incremental share-based compensation expense, as it was deemed such pipeline performance criteria had been met. The share-based compensation expense related to these achievements was recognized in 2024. 16. COLLABORATIVE ARRANGEMENTS The Company has entered into several collaborative arrangements to develop and commercialize products and, in connection with such arrangements, to access technologies, financial, marketing, manufacturing and other resources. Refer to the “Patents and Proprietary Rights” section in “Item 1— Business” of this Annual Report for information with respect to IP protection for these products. The collaboration revenue the Company has earned in the years ended December 31, 2024, 2023 and 2022 is summarized in Note 4, Revenue from Contracts with Customers within the notes to the consolidated financial statements in this Annual Report. The Company’s significant collaborative arrangements are described below: Janssen INVEGA SUSTENNA/XEPLION, INVEGA TRINZA/TREVICTA and INVEGA HAFYERA/BYANNLI Under an exclusive license agreement with Janssen, the Company provided Janssen with rights to, and know-how, training and technical assistance in respect of, the Company’s small particle pharmaceutical compound technology, known as NanoCrystal technology, which was used to develop the long-acting INVEGA products, and the Company received milestone payments from Janssen upon the achievement of certain development goals from Janssen; there are no further milestones to be earned under this agreement. The agreement also provides for tiered royalty payments, which consist of a patent royalty and a know-how royalty, both of which are determined on a country-by-country basis. The patent royalty, which equals 1.5 % of net sales, is payable in each country until the expiration of the last of the patents with valid claims applicable to the product in such country. The know-how royalty is a tiered royalty of 3.5 %, 5.5 % and 7.5 % on aggregate worldwide net sales of below $ 250 million, between $ 250 million and $ 500 million, and greater than $ 500 million, respectively. The know-how royalty rate resets to 3.5 % at the beginning of each calendar year and is payable until 15 years from first commercial sale of a product in each individual country, subject to expiry of the agreement. These royalty payments may be reduced in any country based on patent litigation or on competing products achieving certain minimum sales thresholds. The license agreement, unless earlier terminated, terminates upon the expiration of the last of the patents subject to the agreement. After expiration, Janssen retains a non-exclusive, royalty-free license to develop, manufacture and commercialize the products, subject to certain surviving obligations. Janssen may terminate the license agreement in whole or in part upon three months’ notice to the Company. The Company and Janssen have the right to terminate the agreement upon a material breach of the other party, which is not cured within a certain time period, or upon the other party’s bankruptcy or insolvency. In November 2021, the Company received notice from Janssen of partial termination of the license agreement, following which Janssen ceased paying the Company royalties related to U.S. sales of INVEGA SUSTENNA, INVEGA TRINZA and INVEGA HAFYERA. In April 2022, the Company commenced binding arbitration proceedings related to, among other things, Janssen’s partial termination of this license agreement and Janssen’s royalty and other obligations under the agreement. In May 2023, the Tribunal in the arbitration proceedings issued a Final Award that served to reinstate the Janssen royalties and required payment by Janssen of back royalties and interest for amounts owed but not yet paid since the effective date of the partial termination. The Final Award also provided, among other things, that the Company was entitled to royalty revenues from Janssen related to net sales of INVEGA SUSTENNA through August 20, 2024, INVEGA TRINZA through the second quarter of 2030 (but no later than May 2030 when the license agreement expires) and INVEGA HAFYERA through May 2030 (when the license agreement expires). RISPERDAL CONSTA Under a product development agreement, the Company collaborated with Janssen on the development of RISPERDAL CONSTA. Under the development agreement, Janssen provided funding to the Company for the development of RISPERDAL CONSTA and Janssen is responsible for securing all necessary regulatory approvals for the product. F- 29 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Under two license agreements, the Company granted Janssen and an affiliate of Janssen exclusive worldwide licenses to use and sell RISPERDAL CONSTA. Under its license agreements with Janssen, the Company receives royalty payments equal to 2.5 % of Janssen’s end-market net sales of RISPERDAL CONSTA in each country where the license is in effect based on the quarter when the product is sold by Janssen. This royalty may be reduced in any country based on lack of patent coverage and significant competition from generic versions of the product. Janssen can terminate the license agreements upon 30 days ’ prior written notice to the Company. Either party may terminate the license agreements by written notice following a breach which continues for 90 days after the delivery of written notice thereof or upon the other party’s insolvency. The licenses granted to Janssen expire on a country-by-country basis upon the later of: (i) the expiration of the last patent claiming the product in such country; or (ii) 15 years after the date of the first commercial sale of the product in such country, provided that in no event will the license granted to Janssen expire later than the twentieth anniversary of the first commercial sale of the product in each such country, with the exception of Canada, France, Germany, Italy, Japan, Spain and the United Kingdom, in each case where the fifteen-year minimum shall pertain regardless. After expiration, Janssen retains a non-exclusive, royalty-free license to manufacture, use and sell RISPERDAL CONSTA. The Company exclusively manufactures RISPERDAL CONSTA at its Wilmington, Ohio facility for commercial sale. Under its manufacturing and supply agreement with Janssen, the Company records manufacturing revenues when product is fully manufactured and approved for shipment by both Janssen and the Company. Revenue is based on a percentage of Janssen’s net unit sales price for RISPERDAL CONSTA for the applicable calendar year. This percentage is determined based on Janssen’s unit demand for such calendar year and varies based on the volume of units shipped, with a minimum manufacturing fee of 7.5 %. Either party may terminate the manufacturing and supply agreement upon a material breach by the other party, which is not resolved within 60 days after receipt of a written notice specifying the material breach or upon written notice in the event of the other party’s insolvency or bankruptcy. Janssen may terminate the agreement upon six months ’ written notice to the Company. In the event that Janssen terminates the manufacturing and supply agreement without terminating the license agreements, the royalty rate payable to the Company on Janssen’s net sales of RISPERDAL CONSTA would increase from 2.5 % to 5.0 %. Biogen Under a license and collaboration agreement with Biogen, the Company granted Biogen a worldwide, exclusive, sublicensable license to develop, manufacture and commercialize VUMERITY and other products covered by patents licensed to Biogen under the agreement. Under this license and collaboration agreement, the Company received an upfront cash payment and milestone payments related to the achievement of certain milestones. The Company is also eligible to receive additional payments upon achievement of certain milestones, including milestones relating to the first two products, other than VUMERITY, covered by patents licensed to Biogen under the license and collaboration agreement. In addition, the Company receives a 15 % royalty on worldwide net sales of VUMERITY, subject to increases for VUMERITY manufactured and/or packaged by Biogen or its designees. The Company is also entitled to receive royalties on net sales of products other than VUMERITY covered by patents licensed to Biogen under the license and collaboration agreement, at tiered royalty rates calculated as percentages of net sales ranging from high-single digits to sub-teen double digits. All royalties are payable on a product-by-product and country-by-country basis until the later of (i) the last-to-expire patent right covering the applicable product in the applicable country and (ii) a specified period of time from the first commercial sale of the applicable product in the applicable country. Royalties for all products are subject to customary reductions, as set forth in the license and collaboration agreement. Following FDA approval of VUMERITY and, except for the manufacturing responsibilities discussed below, Biogen is now responsible for all development and commercialization activities for VUMERITY and all other products covered by the patents that we licensed to Biogen. Under the license and collaboration agreement, Biogen appointed the Company as the toll manufacturer of clinical and commercial supplies of VUMERITY, subject to Biogen’s right to manufacture or have manufactured commercial supplies as a back-up manufacturer. In October 2019, the Company entered into a commercial supply agreement with Biogen for the commercial supply of VUMERITY, an amendment to such commercial supply agreement and an amendment to the license and collaboration agreement with Biogen, pursuant to which Biogen has conducted a technology transfer and, following an agreed transition period, has elected to assume responsibility for the manufacture (itself or through a designee) of clinical and commercial supplies of VUMERITY in exchange for an increase in the royalty rate to be paid by Biogen to the Company on net sales of product that is manufactured by Biogen or its designee. In May 2024, the Company completed the sale of the Athlone Facility where VUMERITY is manufactured. In connection with the sale of the Athlone Facility, the Company has entered into a subcontracting arrangement with the purchaser of the Athlone Facility for the manufacture of VUMERITY through the manufacturing transition period, which may continue through the end of 2025. F- 30 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Unless earlier terminated, the license and collaboration agreement will remain in effect until the expiry of all royalty obligations. Biogen has the right to terminate the license and collaboration agreement at will, on a product-by-product basis or in its entirety upon 180 days’ prior notice to the Company. Either party has the right to terminate the license and collaboration agreement following any governmental prohibition of the transactions effected by the agreement, or in connection with an insolvency event involving the other party. Upon termination of the license and collaboration agreement by either party, then, at the Company’s request, the VUMERITY program will revert to the Company. 17. INCOME TAXES The Company’s provision (benefit) for income taxes from continuing operations consists of the following: Year Ended December 31, (In thousands) 2024 2023 2022 (1) Current income tax provision (benefit): U.S. federal $ 25,640 $ ( 981 ) $ 11,169 U.S. state 4,259 722 4,401 Ireland 1,192 — — Deferred income tax provision (benefit): U.S. federal ( 19,870 ) 10,192 ( 10,536 ) U.S. state ( 1,392 ) ( 507 ) ( 3,010 ) Ireland 61,783 ( 107,064 ) — Total tax provision (benefit) $ 71,612 $ ( 97,638 ) $ 2,024 (1) Prior period amounts have been retrospectively adjusted to reflect the effects of the Separation. The income tax provision in 2024 was primarily due to taxes on income earned in Ireland. The income tax benefit in 2023 was primarily due to the partial release of the valuation allowance maintained against certain Irish deferred tax assets, partially offset by taxes on income earned in the U.S. and Ireland. The income tax expense in 2022 was primarily due to taxes on income earned in the U.S. In December 2022, the EU implemented a new corporate minimum tax rate of 15 % on companies with consolidated annual revenue of at least € 750.0 million, which was transposed into Irish law effective as of January 1, 2024. The Company has determined that this new minimum tax had no material impact for the year ended December 31, 2024. The income tax benefit associated with the Company’s former oncology business, and the tax impact of the Separation, are discussed in further detail in Note 3, Discontinued Operations, in these “Notes to Consolidated Financial Statements” in this Annual Report. The tax benefits included within discontinued operations were $ 0.7 million, $ 1.4 million, and $ 11.1 million for the years ended December 31, 2024, 2023, and 2022, respectively. No provision for income tax has been provided on undistributed earnings of the Company’s foreign subsidiaries because such earnings are indefinitely reinvested in the foreign operations. Cumulative unremitted earnings of U.S. subsidiaries totaled approximately $ 933.5 million at December 31, 2024. In the event of a repatriation of those earnings in the form of dividends or otherwise, the Company may be liable for income taxes, subject to adjustment, if any, for foreign tax credits and foreign withholding taxes payable to foreign tax authorities. The Company estimates that approximately $ 72.0 million of income taxes would be payable on the repatriation of the unremitted earnings to Ireland. The distribution of the Company’s income (loss) before the provision (benefit) for income taxes by geographical area consists of the following: Year Ended December 31, (In thousands) 2024 2023 2022 (1) Ireland $ 440,674 $ 411,767 $ ( 32,198 ) U.S. 3,076 9,752 1,070 Income (loss) from continuing operations before provision (benefit) for income taxes $ 443,750 $ 421,519 $ ( 31,128 ) (1) Prior period amounts have been retrospectively adjusted to reflect the effects of the Separation. F- 31 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The components of the Company’s net deferred tax assets consist of the following: December 31, December 31, (In thousands) 2024 2023 Deferred tax assets: Net operating loss carryforwards $ 80,209 $ 195,658 Research and development expenses 71,167 49,206 Accrued expenses and reserves 41,189 37,367 Operating lease liabilities 17,537 18,716 Share-based compensation 33,773 37,727 Tax credits 26,882 27,116 Other 3,695 5,582 Less: valuation allowance ( 79,727 ) ( 129,296 ) Total deferred tax assets 194,725 242,076 Deferred tax liabilities: Property, plant and equipment ( 21,917 ) ( 26,271 ) Right-of-use assets ( 16,337 ) ( 17,748 ) Other ( 1,940 ) ( 2,716 ) Total deferred tax liabilities ( 40,194 ) ( 46,735 ) Net deferred tax assets $ 154,531 $ 195,341 The activity in the valuation allowance associated with deferred taxes consists of the following: (In thousands) Balance at Beginning of Period (1) (Additions) / Reductions (2) Balance at End of Period (1) Deferred tax asset valuation allowance for the year ended December 31, 2022 $ ( 249,112 ) $ ( 22,405 ) $ ( 271,517 ) Deferred tax asset valuation allowance for the year ended December 31, 2023 $ ( 271,517 ) $ 142,221 $ ( 129,296 ) Deferred tax asset valuation allowance for the year ended December 31, 2024 $ ( 129,296 ) $ 49,569 $ ( 79,727 ) (1) Inclusive of continuing and discontinued operations for the periods prior to the Separation in November 2023. (2) (Additions) reductions represent continuing and discontinued operations for the periods prior to the Separation in November 2023. The reductions during the year ended December 31, 2024 primarily relate to the abandonment of certain Irish NOLs following the sale of the Athlone Facility to Novo. These NOLs were transferred from Elan Corporation, plc as part of the combination of the drug technology business of Elan Corporation, plc with the business of Alkermes, Inc. A number of restrictions applied to these NOLs thereby restricting the Company’s ability to utilize such NOLs. Following the sale of the Athlone Facility, the Company believes that its ability to utilize these NOLs is remote. The reduction during the year ended December 31, 2023 primarily relates to the partial release of the valuation allowance maintained by the Company against certain Irish net deferred tax assets. The additions in 2022 relate primarily to Irish NOLs. The Company regularly assesses the need for a valuation allowance against its deferred tax assets. In making such assessment, the Company considers both positive and negative evidence related to the likelihood of realization of the deferred tax assets to determine, based on the weight of available evidence, whether it is more-likely-than-not that some or all of the deferred tax assets will not be realized. At December 31, 2024, the Company maintained a valuation allowance of $ 29.6 million against certain U.S. state deferred tax assets and $ 50.1 million against certain Irish deferred tax assets, as the Company has determined that it is more-likely-than-not that these deferred tax assets will not be realized and some may be abandoned. If the Company incurs losses in the U.S. or in Ireland in the future, or fails to achieve sufficient profitability in a timely manner, the evaluation of the recoverability of the deferred tax assets could change and a valuation allowance against such deferred tax assets may be required in part or in whole. The Company will continue to monitor the need for a valuation allowance against its deferred tax assets on a quarterly basis. As of December 31, 2024, the Company had $ 393.9 million of Irish NOL carryforwards, $ 14.1 million of U.S. federal NOL carryforwards, $ 43.2 million of state NOL carryforwards and $ 34.0 million of state tax credits which will either expire on various dates through 2039 or can be carried forward indefinitely. These loss and credit carryforwards are available to reduce certain future Irish and foreign taxable income and tax. These loss and credit carryforwards are subject to review and possible adjustment by the appropriate taxing authorities and may be subject to limitations based upon changes in the ownership of the Company’s ordinary shares. Included within these loss and credit carryforwards are $ 14.1 million of U.S. federal NOL carryforwards and $ 5.8 million of state NOL carryforwards, acquired as part of the acquisition of Rodin Therapeutics, Inc. in November 2019, each of which are subject to a $ 0.5 million annual limitation. F- 32 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) A reconciliation of the Company’s statutory tax rate to its effective tax rate is as follows: Year Ended December 31, (In thousands, except percentage amounts) 2024 2023 2022 (1) Statutory tax rate 12.5 % 12.5 % 12.5 % Income (loss) from continuing operations before income taxes at statutory rate $ 55,469 $ 52,690 $ ( 3,891 ) Share-based compensation 5,607 4,177 4,347 Foreign rate differential (2) 4,844 4,701 521 Change in valuation allowance ( 49,517 ) ( 142,424 ) 1,102 Intercompany amounts (3) 708 ( 16,551 ) ( 1,694 ) Irish rate differential (4) 5,798 235 4,926 Uncertain tax positions ( 667 ) ( 234 ) 602 Non-deductible lobbying expenses 767 705 775 U.S. state income taxes, net of U.S. federal benefit 2,802 347 1,272 Foreign derived intangible income ( 281 ) — ( 4,530 ) R&D credit ( 7,815 ) ( 2,823 ) ( 2,531 ) Abandonment of NOLs (5) 49,897 — — Other permanent items (6) 4,000 1,539 1,125 Income tax provision (benefit) $ 71,612 $ ( 97,638 ) $ 2,024 Effective tax rate 16.1 % ( 23.2 ) % ( 6.5 ) % (1) Prior period amounts have been retrospectively adjusted to reflect the effects of the Separation. (2) Represents income or losses of U.S. subsidiaries, subject to tax at a rate other than the Irish statutory rate. (3) Intercompany amounts include cross-territory eliminations, the pre-tax effect of which has been eliminated in arriving at the Company's consolidated income (loss) before taxes from continuing operations. In 2023, this included a tax benefit of $ 15.7 million related to the intercompany transfer of inventory that was owned by the Company at December 31, 2023. (4) Represents income or losses of Irish companies subject to tax at a rate other than the Irish statutory rate. (5) Represents the tax effect of the abandonment of Irish NOLs following the sale of the Athlone Facility to Novo. (6) Other permanent items include, but are not limited to, non-deductible meals and entertainment expenses and non-deductible compensation of senior officers of the Company. For the year ended December 31, 2024, permanent items also included amounts relating to the sale of the Athlone Facility. A reconciliation of the beginning and ending amount of unrecognized tax benefits is as follows: Unrecognized (In thousands) Tax Benefits Balance, December 31, 2021 $ 8,372 Reductions based on the lapse of applicable statutes of limitations ( 438 ) Additions based on tax positions related to prior periods 449 Additions based on tax positions related to the current period 590 Balance, December 31, 2022 $ 8,973 Reductions based on the lapse of applicable statutes of limitations ( 1,073 ) Additions based on tax positions related to the prior period 281 Additions based on tax positions related to the current period 558 Balance, December 31, 2023 $ 8,739 Reductions based on the lapse of applicable statutes of limitations ( 1,306 ) Additions based on tax positions related to the prior period 59 Additions based on tax positions related to the current period 581 Balance, December 31, 2024 $ 8,073 The unrecognized tax benefits at December 31, 2024, if recognized, would affect the Company’s effective tax rate. The Company does not anticipate that the amount of existing unrecognized tax benefits will materially increase or decrease within the next 12 months. The Company has elected to include interest and penalties related to uncertain tax positions as a component of its provision for taxes. For the years ended December 31, 2024, 2023 and 2022, the Company’s accrued interest and penalties related to uncertain tax positions were not material. F- 33 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) The Company’s major taxing jurisdictions include Ireland and the U.S. (federal and state). These jurisdictions have varying statutes of limitations. In the U.S., the 2021 through 2024 fiscal years remain subject to examination by the respective tax authorities, however, some states have longer statutes of limitations and additional fiscal years remain subject to examination. In Ireland, the 2020 through 2024 fiscal years remain subject to examination by the Irish tax authorities. Additionally, because of the Company’s Irish and U.S. loss carryforwards and credit carryforwards, certain tax returns from fiscal years 2002 onward may also be examined. These years generally remain open for three to four years after the loss carryforwards and credit carryforwards have been utilized. 18. SEGMENT REPORTING Segment Information Following the adoption of ASU 2023-07, the Company is required to disclose significant segment expenses that are regularly provided to the CODM. The Company’s CODM is periodically provided R&D expenses, selling and marketing expenses, and general and administrative expenses. Other external R&D expenses are composed of general research and development expenses and other external projects. Other internal R&D expenses include allocation expenses, travel expenses, and fees, taxes and dues. The Company’s significant segment expenses are as follows: Year Ended December 31, (In thousands) 2024 2023 2022 REVENUES: Total revenue $ 1,557,632 $ 1,663,405 $ 1,111,795 EXPENSES: Cost of goods manufactured and sold (exclusive of amortization of acquired intangible assets shown below) 245,331 253,037 218,068 External R&D expenses: Development programs: ALKS 2680 45,947 31,321 15,715 LYBALVI 18,737 15,379 23,056 Other external R&D expenses 36,627 51,668 57,423 Total external R&D expenses 101,311 98,368 96,194 Internal R&D expenses: Employee-related 114,496 128,282 129,735 Occupancy 11,206 12,299 12,449 Depreciation 5,701 9,578 10,708 Other internal R&D expenses 12,612 22,279 23,616 Total internal R&D expenses 144,015 172,438 176,508 R&D expenses 245,326 270,806 272,702 Selling, general and administrative expenses: Selling and marketing expense 446,214 490,154 392,211 General and administrative expense 199,024 199,597 198,540 Total selling, general and administrative expense 645,238 689,751 590,751 Other segment (expenses) income (1) ( 49,599 ) 69,346 ( 63,426 ) NET INCOME (LOSS) FROM CONTINUING OPERATIONS 372,138 519,157 ( 33,152 ) LOSS ON DISCONTINUED OPERATIONS, NET OF TAX ( 5,068 ) ( 163,400 ) ( 125,115 ) NET INCOME (LOSS) $ 367,070 $ 355,757 $ ( 158,267 ) (1) “Other segment (expenses) income” during the years ended December 31, 2024, 2023 and 2022 includes “Amortization of acquired intangible assets”, “Other income (loss), net” and “Income tax provision (benefit)”. F- 34 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) 19. COMMITMENTS AND CONTINGENT LIABILITIES Litigation From time to time, the Company may be subject to legal proceedings and claims in the ordinary course of business. On a quarterly basis, the Company reviews the status of each significant matter and assesses its potential financial exposure. If the potential loss from any claim, asserted or unasserted, or legal proceeding is considered probable and the amount can be reasonably estimated, the Company would accrue a liability for the estimated loss. Because of uncertainties related to claims and litigation, accruals are based on the Company’s best estimates, utilizing all available information. On a periodic basis, as additional information becomes available, or based on specific events such as the outcome of litigation or settlement of claims, the Company may reassess the potential liability related to these matters and may revise these estimates, which could result in material adverse adjustments to the Company’s operating results. At December 31, 2024, there were no potential material losses from claims, asserted or unasserted, or legal proceedings that the Company determined were probable of occurring. INVEGA TRINZA ANDA Litigation In September 2020, Janssen Pharmaceutica, Janssen Pharmaceuticals, Inc., and Janssen Research & Development, LLC initiated a patent infringement lawsuit in the NJ District Court against Mylan Labs, Mylan, and Mylan Institutional LLC following the filing by Mylan Labs of an ANDA seeking approval from the FDA to market a generic version of INVEGA TRINZA before the expiration of U.S. Patent No. 10,143,693 (the “’693 Patent”). Requested judicial remedies include recovery of litigation costs and injunctive relief. In May 2023, the NJ District Court issued an opinion in favor of the Janssen entities on the issues of infringement and validity of the ’693 Patent and the Mylan entities filed a notice of appeal of the decision. The Company is not a party to this proceeding. VUMERITY ANDA Litigation In July 2023, Biogen Inc., Biogen Swiss Manufacturing GmbH and Alkermes Pharma Ireland Limited filed a patent infringement lawsuit in the DE District Court against Zydus Worldwide DMCC, Zydus Pharmaceuticals (USA) Inc. and Zydus Lifesciences Limited (collectively, “Zydus”) following the filing by Zydus of an ANDA seeking approval from the FDA to engage in the commercial manufacture, use or sale of a generic version of VUMERITY (diroximel fumarate) delayed-release capsules for oral use, 231 mg, before expiration of the Company’s U.S. Patent Nos. 8,669,281; 9,090,558; and 10,080,733. The filing of the lawsuit triggered a stay of FDA approval of the ANDA for up to 30 months in accordance with the U.S. Drug Price Competition and Patent Term Restoration Act of 1984 (the “Hatch-Waxman Act”). A bench trial is scheduled to begin on July 28, 2025. Government Matters The Company has received a subpoena and civil investigative demands from U.S. state and federal governmental authorities for documents related to VIVITROL. The Company is cooperating with the investigations. Product Liability and Other Legal Proceedings The Company is involved in litigation and other legal proceedings incidental to its normal business activities, including a product liability case alleging that the FDA-approved VIVITROL labeling was inadequate and that VIVITROL caused the individual to suffer from opioid overdose and death. The Company intends to vigorously defend itself in these matters. In addition, in January 2023, Acorda filed a petition with the U.S. District Court for the Southern District of New York (the “NY Southern District Court”) asking the court to confirm in part and modify in part the final arbitral award rendered by an arbitration panel in October 2022 and, as part of the requested modification, seeking an additional approximately $ 66.0 million in damages. In August 2023, the NY Southern District Court confirmed the final arbitral award and declined to modify the final award to increase the damages awarded thereunder. In September 2023, Acorda filed a notice of appeal of the NY Southern District Court decision to the U.S. Court of Appeals for the Federal Circuit (the “Federal Circuit Court”), and the Company filed a motion to transfer the appeal to the U.S. Court of Appeals for the Second Circuit. In January 2024, the Federal Circuit Court denied without prejudice the Company’s motion to transfer the appeal and instructed the parties to brief the jurisdictional question as part of the merits appeal. Briefing in the Federal Circuit Court is complete, and the matter is pending decision. F- 35 ALKERMES PLC AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued) Guarantees In connection with the Separation, the Company entered into the Assignment related to the 852 Winter Street Lease, which is described in more detail in Note 10, Leases in these “Notes to Consolidated Financial Statements” in this Annual Report. Although the Assignment transferred all of the rights, title and interest in, to and under the 852 Winter Street Lease to Mural US as of November 15, 2023, the Company ratified and reaffirmed for the remainder of the lease term its guarantor obligations under that certain Guaranty dated as of May 16, 2014 related to the 852 Winter Street Lease. Upon completion of the Separation, the Assignment was accounted for as a termination of the original lease and the Company de-recognized the right-of-use asset and lease liability related to the 852 Winter Street Lease. At December 31, 2024, the fair value of the guarantee was no t material to the Company. Purchase Commitments The Company has open purchase orders for plant and equipment as part of its normal course of business. At December 31, 2024, the Company’s open purchase orders were $ 17.7 million for capital commitments. F- 36