Viatris 10-K/A 2020-12-31

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K/A

(Amendment No. 1)

☑	Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Fiscal Year Ended

December 31, 2020

OR

☐	Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to .

Commission file number 001-39695

VIATRIS INC.

(Exact name of registrant as specified in its charter)

Delaware		83-4364296
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

1000 Mylan Boulevard, Canonsburg, Pennsylvania, 15317

(Address of principal executive offices) (Zip Code)

(724) 514-1800

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class:		Trading Symbol(s)		Name of Each Exchange on Which Registered:
Common Stock, par value $0.01 per share		VTRS		The NASDAQ Stock Market

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes

☐

No

☑

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes

☐

No

☑

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes

☑

No

☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes

☑

No

☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange

Act

.

Large accelerated filer		☐		Accelerated filer		☐
Non-accelerated filer		☑		Smaller reporting company		☐
				Emerging growth company		☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

☑

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes

☐

No

☑

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant as of June

, 2020, the last business day of the registrant’s most recently completed second fiscal quarter:

No

established public trading market for the registrant’s common stock as of such date.

The number of shares of common stock outstanding, par value $0.01 per share, of the registrant as of April 26, 2021 was 1,208,643,411

.

DOCUMENTS INCORPORATED BY REFERENCE

None.

EXPLANATORY NOTE

This Amendment No. 1 on Form 10-K/A (this “Amendment”) amends our Annual Report on Form 10-K for the fiscal year ended December 31, 2020, originally filed on March 1, 2021 (the “Original Filing”). We are filing this Amendment to include the information required by Part III and not included in the Original Filing, as we do not intend to file a definitive proxy statement for an annual meeting of shareholders within 120 days of the end of our fiscal year ended December 31, 2020. In addition, in connection with the filing of this Amendment and pursuant to the rules of the Securities and Exchange Commission (the “SEC”), we are including with this Amendment new certifications of our principal executive officer and principal financial officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. Item 15 of Part IV has also been amended to reflect the filing of these new certifications and a corrected exhibit. Except as described above, no other changes have been made to the Original Filing. The Original Filing continues to speak as of the date of the Original Filing, and we have not updated the disclosures contained therein to reflect any events which occurred at a date subsequent to the filing of the Original Filing.

As used in this Amendment, unless the context requires otherwise, the “Company,” “Viatris,” “our,” and “we” mean Viatris Inc. and its consolidated subsidiaries, “NASDAQ” means The NASDAQ Global Select Stock Market, and “U.S. GAAP” means accounting principles generally accepted in the United States (“U.S.”).

On November 16, 2020, Viatris, formerly known as Upjohn Inc. (“Upjohn”), Mylan N.V. (“Mylan”) and Pfizer Inc. (“Pfizer”) consummated the combination of Mylan with Pfizer’s Upjohn business (the “Upjohn Business”) through a Reverse Morris Trust transaction. In accordance with the terms and conditions of the Business Combination Agreement, dated as of July 29, 2019, as amended from time to time, among Viatris, Mylan, Pfizer and certain of their affiliates (the “Business Combination Agreement”) and the Separation and Distribution Agreement between Viatris and Pfizer, dated as of July 29, 2019, as amended from time to time, (1) Pfizer contributed the Upjohn Business to Viatris so that the Upjohn Business was separated from the remainder of Pfizer’s businesses (the “Separation”), (2) following the Separation, Pfizer distributed, on a pro rata basis (based on the number of shares of Pfizer common stock held by holders of Pfizer common stock as of the record date of November 13, 2020 (the “Record Date”)), all of the shares of Viatris common stock held by Pfizer to Pfizer shareholders as of the Record Date (the “Distribution”), and (3) immediately following the Distribution, Viatris and Mylan engaged in a strategic business combination transaction (the “Combination”). As a result of the Combination, Viatris holds the combined Upjohn Business and Mylan business. In accordance with

ASC 805, Business Combinations

, Mylan is considered the accounting acquirer of the Upjohn Business and all historical financial information of the Company prior to November 16, 2020 represents Mylan’s historical results and the Company’s thereafter.

Forward-Looking Statements

This Amendment contains “forward-looking statements”. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements may include, without limitation, statements about the Combination, the benefits and synergies of the Combination or our global restructuring program, future opportunities for the Company and its products and any other statements regarding the Company’s future operations, financial or operating results, capital allocation, dividend policy, debt ratio, anticipated business levels, future earnings, planned activities, anticipated growth, market opportunities, strategies, competitions, efforts to create, enhance

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Compensation Discussion and Analysis

Executive Summary — Important Background and Key Considerations

Viatris has a shareholder-aligned compensation philosophy. Viatris empowers people worldwide to live healthier at every stage of life. As the world’s healthcare needs evolve, we believe that the Viatris Global Healthcare Gateway ® will fuel our organic development of innovative products and offer partners ready access to expanded markets through an innovative global infrastructure that connects people around the world to the high-quality medicines and services they need. We provide access to medicines, advance sustainable operations, develop innovative solutions, and leverage our collective expertise to improve patient health. Our compensation program supports these and other goals, drives performance, and aligns with shareholder outcomes. Employee health and safety has been a priority throughout the COVID-19 pandemic. Steps were taken throughout 2020 to protect Mylan, Upjohn, and Viatris employees. We utilized screening and safe work protocols, and provided personal protective equipment (PPE) to employees. In addition, we provided bonuses to our frontline workers in recognition of their efforts to help ensure that patients around the world continued to receive essential medications uninterrupted. Employees were also provided with additional benefits during the COVID-19 pandemic, including expansion of Employee Assistance Program counseling and flexible work arrangements, among other supplemental benefit offerings in certain countries. Despite the challenges presented by the global pandemic, we continued to serve the needs of patient access in 2020 . Mylan and Pfizer’s Upjohn division (and Viatris post-Combination) collectively sold approximately 85 billion doses of medicine across 165 countries and territories in 2020 on a full year basis. Our outstanding colleagues around the world maintained consistent supply of product to ensure continued patient access while also effectively managing the integration of two large companies. See pages 22-23 for additional selected highlights. Reported 2020 compensation reflects three distinct programs. Viatris was formed in November 2020 after the Combination of Mylan and Upjohn. As a result, reported 2020 compensation must be viewed as a reflection of three distinct compensation programs: those of Mylan, Upjohn, and Viatris. Our 2020 compensation tables include certain one-time, transaction-related payments. In 2020, certain one-time payments were made to support the successful combination of Mylan and Upjohn and to secure the ongoing services of our NEOs. These payments are reflected in the 2020 compensation tables but will not be part of the executive compensation program going forward.				Committed to Delivering Significant Shareholder Value Unique global platform Unparalleled global reach and global network with sustainable, diverse, and differentiated portfolio Performance- driven culture Focused on commercial execution, operational excellence, financial discipline, and corporate social responsibility Global Healthcare Gateway ® innovative global infrastructure offers partners ready access to expanded markets as well as our organic development to fuel future growth Execution roadmap to optimize total shareholder return Right internal conditions to maximize value creation with clear execution plan and disciplined capital deployment

The Viatris Compensation Committee took several actions responsive to shareholder feedback in developing its initial executive compensation program. Consistent with shareholder feedback, we eliminated all NEO excise tax gross-ups that otherwise would have carried forward from predecessor companies and froze or eliminated supplemental executive retirement benefits, among other actions described herein. See also pages 25-26. In 2021, the Viatris Compensation Committee and Board implemented a new performance-based, shareholder-aligned compensation program. After closing of the Combination, we implemented a rigorous performance-based compensation program, with approximately 70% of executive target pay opportunity in the form of equity-based awards, and almost 60% of executive target pay opportunity tied to key, shareholder-aligned performance metrics. Our compensation program is designed to promote retention and motivate the senior leadership team to achieve rigorous performance goals that are closely tied to our strategy and which we believe will promote the creation of shareholder value.

Introduction

Because Viatris first became a new public company in November 2020, this Compensation Discussion and Analysis (“CD&A”) includes disclosure of compensation related to three distinct programs: those of Viatris, Mylan and Upjohn. Although Viatris is not a successor registrant of Mylan or Pfizer, we are presenting consolidated full-year compensation information with respect to the Viatris NEOs for 2020 consistent with applicable SEC regulations and to provide insight with respect to the full year as well as context for the Viatris compensation program moving forward. Specifically, this CD&A includes a discussion of both pre-Combination compensation of our NEOs with Mylan or Pfizer, as applicable, and our NEOs’ post-Combination compensation with Viatris. Notably, significant portions of the reported 2020 compensation include one-time transaction-related items that will not be components of the Viatris 2021 compensation program.

The reported compensation in this CD&A thus reflects three distinct corporate philosophies. However, given that the Viatris compensation program will be the sole program following the closing of the Combination, we will focus on the philosophy governing Viatris’ compensation program, which will provide the most relevant context for our program going forward.

Viatris: A New Kind of Healthcare Company

Viatris is a global healthcare company whose mission is to empower people worldwide to live healthier at every stage of life. Viatris brings together some of the industry’s best talent and an unparalleled business platform in service to patients, regardless of their geography or circumstance. We believe that the Company is uniquely positioned to deliver increased access to affordable, quality medicines for patients worldwide.

We believe that the combined company has industry leading R&D, medical, regulatory, manufacturing, supply chain, and commercial expertise complemented by an unequivocal commitment to quality and a global geographic footprint that is capable of delivering high-quality medicines to patients in more than 165 countries and territories. Viatris’ sustainable, diverse, and differentiated portfolio comprises more than 1,400 approved molecules across a wide range of key therapeutic areas, including globally recognized iconic and key brands, generics, complex generics, and biosimilars. Viatris operates manufactur

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