Viatris Inc. (VTRS) Earnings & Analysis

Latest quarter

Viatris reported third-quarter revenue that was essentially flat with a year earlier, and the company’s result missed the consensus revenue estimate. Its diluted loss per share widened to −$0.28 from −$0.11 a year earlier. The filing said the quarter’s tax provision was affected by losses in jurisdictions where minimal tax benefits could be realized.

The filing said new-product sales were largely offset by erosion in the existing business, reflecting supply constraints in Europe and emerging markets and competition on certain products. Greater China sales rose as the company increased marketing and selling efforts, while Developed Markets, JANZ and Emerging Markets sales declined.

Viatris reported gross margin of 38.4%, up from 36.5% a year earlier. The filing attributed the change partly to fewer sales of lower-margin products affected by supply disruptions and more sales of higher-margin products in Greater China and North America. Free cash flow increased to $896.5 million from $646.0 million.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

CEO Scott Smith said demand for estradiol patches and revenue from injectable launches supported North American growth as the portfolio shifted toward higher-margin products and complex generics. Interim CFO Paul Campbell said North American patch volumes were approximately double their year-earlier level, and the company had expanded capacity through operational improvements.

Asked about the patch market, Smith said Viatris had moved its plant to continuous operation, was adding a packaging line and was exploring expansion to other sites. Chief Commercial Officer Corinne Le Goff said the company expected patch demand to keep increasing and was seeing willingness among clinicians to treat patients following the removal of a warning on hormone replacement therapy.

Campbell said growth in Greater China and North America offset supply constraints in Europe and emerging markets and benefited adjusted EBITDA through higher net margins. He said the company suspended manufacturing at Nashik in October while remediation continued, following an FDA classification of the plant in September.

On China, Campbell told analysts that procurement-policy changes had begun to moderate growth, particularly in hospitals. He said differences in provincial readiness and enforcement were “preventing us from being precise on what we think the impact is,” and expected a greater effect in the fourth quarter as more provinces came online.

Smith said Viatris had agreed to acquire Pacira BioSciences, which would add EXPAREL and ZILRETTA to its U.S. portfolio. Campbell said the company expected to fund the transaction with excess cash and short-term borrowing and to close it before the end of November. Asked about future competition for EXPAREL, Campbell said Viatris was not counting on generic manufacturers encountering production problems.

Chief R&D Officer Philippe Martin said studies of cenerimod and selatogrel were performing as expected, with results anticipated in the first half of 2027.

Guidance

Viatris narrowed its 2026 revenue outlook to $14.7 billion–$14.9 billion and raised its adjusted EPS outlook to $2.56–$2.63. Campbell said the company also raised its adjusted EBITDA outlook and that the updated guidance excludes the proposed Pacira acquisition.