Bio-Rad Laboratories (BIO) 2024年年度報告「NYSE」.pdf

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1、Bio-Rad Laboratories Annual Report 2024We advance science and save lives,together.Bio-Rad Laboratories2024 ANNUAL REPORT2021$2,9232022$2,8022023$2,6712024$2,5662020$2,546Net Revenue(in millions)2021$6692022$1942020$5852023$3752024$455Cash Flow From Operations(in millions)2021$1,6382022$1,5672023$1,4

2、272020$1,4382024$1,379Gross Profit(in millions)FINANCIALHIGHLIGHTS2021$5002020$4212022$4832023$3382024$269Operating Income(in millions)2024 FINANCIAL HIGHLIGHTS1Looking back over the last several years and all the changes we have seen,both internally and externally,I am reminded how important resili

3、ence is to an organization.In fact,looking back to the beginning of Bio-Rad and thinking how we have continuously adapted to changing markets,new technology,and new ways to operate over the last 70 plus years,resilience and adaptability have played a big part in our success.At the same time,our comm

4、itment to quality and innovation,and a collective mindset of staying one step ahead,have enabled us to bring new and useful products to our customers.2024 was a year of change for Bio-Rad with the addition of several new senior leaders.The seasoned executives we have appointed to lead our operations

5、,finance,supply chain,legal,LifeScience,and Clinical Diagnostics segments,collectively bring decades of experience and fresh ideas to the organization.Together,we are dedicated to enhancing customer satisfaction,operational excellence,and driving efficiency while fostering a culture of innovation an

6、d continuous improvement.We entered the year anticipating a gradual improvement,especially in biopharma,but the pace of market recovery was slower than expected.While this created headwinds for our Life Science segment,we returned to a more normalized growth rate in our Clinical Diagnostics business

7、.Even with the slower market recovery,our broad-based,multi-year transformation helped us effectively navigate the changing conditions around us.For the full-year 2024,we reported sales of$2.6 billion compared to$2.7 billion in 2023.On a currency-neutral basis,2024 sales decreased 3.6%year-over-year

8、,driven by lower Life Science sales,and offset by stronger demand for our Clinical Diagnostics products.Compared to 2023,we saw a 30-basis point improvement in our gross margin.The gross margin expansion was possible because of initiatives including the consolidation of several European manufacturin

9、g sites into our Singapore manufacturing hub and the opening of a new distribution center in Singapore.Collectively,these projects simplify our logistics network and inventory management to better serve our customers in the Asia Pacific region.Both initiatives will also help us improve product margi

10、ns going forward.And as we implement these and other operational improvements,we continue to carefully manage our operating expenses.LETTER TO SHAREHOLDERSLETTER TO SHAREHOLDERS continuedOn the product front,in 2024 we introduced two new Life Science research platforms the ChemiDoc Go Imaging System

11、 for analyzing gels and western blots,and the ddSEQ Single-Cell Kit,a cost-effective sample prep solution for researchers to easily conduct single-cell gene expression and regulationanalyses.In Life Science,we acquired Saber Bio,a development-stage platform using our core droplet technology for high

12、-throughput discovery of novel antibodies and T-cell receptors,which play a critical role in helping researchers identify potential therapeutic drug candidates.We also expanded our library of assays for use with Droplet Digital PCR to advance early diagnosis and monitoring of various cancers,cell an

13、d gene therapy manufacturing,and food safety monitoring.In addition,we made investments and formed partnerships to drive the penetration of our Droplet Digital PCR platform into life science research and advanced clinical OFFICERS Clockwise from top center:Norman SchwartzChairman of the Board,Chief

14、Executive OfficerJonathan P.DiVincenzoPresident,Chief Operating OfficerRoop K.LakkarajuExecutive Vice President,Chief Financial Officer2LETTER TO SHAREHOLDERS continuedNorman SchwartzCHAIRMAN AND CHIEF EXECUTIVE OFFICER diagnostics.We partnered with the Allegheny Health Network of hospitals to gener

15、ate clinical evidence across various cancer types using Bio-Rads Droplet Digital PCR technology for minimal residual disease monitoring of solid tumor cancer patients after treatment.We made an investment in Oncocyte to support the commercialization of transplant monitoring assays deploying Bio-Rads

16、 QX600 DropletDigital PCR System,offering laboratory customers a highly sensitive alternative to centralized sequencing test providers.We also invested in Geneoscopy to support the launch of their FDA-approved,non-invasive colorectal cancer screening test utilizing our digital PCR platform.Bio-Rad b

17、egins 2025 in a strong position.Our long-term strategy remains intact,and we believe in our ability to deliver value to our customers.In Clinical Diagnostics,we have leading positions globally for our core platforms.We are actively investing in supporting their growth while building positions in new

18、 molecular diagnostic applications.In Life Science,we will continue to focus on the biopharma sector,especially with our digital PCR and process chromatography products,and new product development around cell biology.The operational improvements made over the last several years put us in a position

19、to continue to expand our margin profile.As the markets get back on a solid growth trajectory,this will further support our margin expansion.We have an incredibly talented team,several new products in development,and we enter 2025 with renewed focus on our mission to collaborate with our customers i

20、n advancing science and improving healthcare outcomes to save lives.Thank you for your support and interest in Bio-Rad.3PRODUCTHIGHLIGHTSdd-Check STEC Solution for Food Safety Testing This assay detects virulence genes from Shiga toxinproducing Escherichia coli(STEC)in food samples.It is the first d

21、dPCR method approved by AOAC International,a leading association for food safety.Unlike standard qPCR testing methods for STEC,ddPCR technology can detect colocalization of virulence genes in a single bacterium,reducing false positives.Vericheck ddPCR Empty-Full Capsid Kit for Gene Therapy Productio

22、n Many gene therapies use AAV viral vectors to deliver therapeutic genes to patients cells.The manufacturing process produces a mixture of full(containing the gene of interest)and empty capsids.The Vericheck ddPCR Empty-Full Capsid Kit measures viral titer and the ratio of empty to full capsids,enab

23、ling accurate quality assessment.This is the first ddPCR kit to simultaneously detect protein and genetic material.New Applications Using Bio-Rads Droplet Digital PCR TechnologyddPLEX ESR1 Mutation Detection Kit for Oncology Research This kit is a powerful research tool that enables same-day multipl

24、exed detection,discrimination,and quantification of seven mutations in the ESR1 gene.Mutations in ESR1 drive resistance to some types of breast cancer therapies.Using this kit,researchers can quickly and effectively assess breast cancer samples to support their research studies.2024 PRODUCT HIGHLIGH

25、TS4PRODUCTHIGHLIGHTS ddSEQ Single-Cell 3 RNA-Seq Kit for Single-Cell Analysis Designed to run on Bio-Rads droplet-based ddSEQ Single-Cell Isolator,the ddSEQ Single-Cell 3 RNA-Seq Kit and accompanying Omnition v1.1 Analysis Software enable researchers to easily conduct single-cell gene expression and

26、 regulation analyses.This kit supports a broad range of research fields,including oncology,immunology,neurology,and stem cellbiology.2024 PRODUCT HIGHLIGHTSChemiDoc Go Imaging System for Life Science Research The ChemiDoc Go Imaging System is the first benchtop imager on the market to leverage advan

27、ced complementary metal oxide semiconductor(CMOS)digital imaging to capture gel and western blot images with the same high sensitivity as larger instruments.Researchers can use the ChemiDoc Go Systems user-friendly interface,LED illumination,and cloud connectivity for easy and accurate benchtop imag

28、ing.Foresight Pro 45 cm Diameter Chromatography Columns for Drug Manufacturing Prepacked with Bio-Rad resins,these columns extend Bio-Rads portfolio for process-scale chromatography across various stages of biological drug production.Foresight Pro Columns offer manufacturers an integrated solution f

29、or downstream purification of biotherapeutics,including vaccines,antibodies,andrecombinantproteins.Solutions for Life Science Research and Drug Manufacturing 52024 YEAR INREVIEW19.0%Academia&Governments13.3%Biopharma7.8%Applied Markets33.8%Hospital Labs19.5%Reference Labs6.6%Transfusion Labs32.5%EME

30、A20.3%ASIA-PACIFIC47.2%AMERICASTOTAL SALES IN 2024$2.57 BILLIONTOTAL SALES IN 2024$2.57 BILLIONCLINICAL DIAGNOSTICS$1.538BLIFE SCIENCE$1.028BBio-Rad is a leader in developing,manufacturing,and marketing a broad range of products for the life science research and clinical diagnostics markets.We opera

31、te a global network of research,development,manufacturing,and sales operations with approximately 7,700 employees and$2.6billion in revenues in 2024.Our customers include universities,research institutions,hospitals,and biopharmaceutical companies,as well as clinical,food safety and environmental qu

32、ality laboratories.Together,we develop innovative,high-quality products that advance science and save lives.62024 YEAR IN REVIEWUNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington,D.C.20549FORM 10-K(Mark One)ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For

33、 the fiscal year ended December 31,2024ORTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period from _ to _Commission file number 1-7928BIO-RAD LABORATORIES,INC.(Exact name of registrant as specified in its charter)Delaware94-1381833(State or

34、 other jurisdiction of incorporation)(I.R.S.Employer Identification No.)1000 Alfred Nobel Drive,Hercules,California94547(Address of principal executive offices)(Zip Code)Registrants telephone number,including area code(510)724-7000Securities registered pursuant to Section 12(b)of the Act:Title of Ea

35、ch ClassTradingSymbolsName of Each Exchange on Which RegisteredClass A Common Stock Par Value$0.0001 per shareBIONew York Stock ExchangeClass B Common Stock Par Value$0.0001 per shareBIO.BNew York Stock ExchangeSecurities registered pursuant to Section 12(g)of the Act:NONEIndicate by check mark if t

36、he registrant is a well-known seasoned issuer,as defined in Rule 405 of the Securities Act.YesNoIndicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d)of the Act.YesNoIndicate by check mark whether the registrant(1)has filed all reports requir

37、ed to be filed by Section 13 or 15(d)of the Securities ExchangeAct of 1934 during the preceding 12 months(or for such shorter period that the registrant was required to file such reports),and(2)has beensubject to such filing requirements for the past 90 days.YesNoIndicate by check mark whether the r

38、egistrant has submitted electronically every Interactive Data File required to be submitted pursuant toRule 405 of Regulation S-T during the preceding 12 months(or for such shorter period that the registrant was required to submit such files).YesNoIndicate by check mark whether the registrant is a l

39、arge accelerated filer,an accelerated filer,a non-accelerated filer,a smaller reporting company,or an emerginggrowth company.See the definitions of“large accelerated filer,”“accelerated filer,”“smaller reporting company,”and“emerging growth company”in Rule12b-2 of the Exchange Act.Large accelerated

40、filerAccelerated filerNon-accelerated fileSmaller reporting companyEmerging growth companyIf an emerging growth company,indicate by check mark if the registrant has elected not to use the extended transition period forcomplying with any new or revised financial accounting standards provided pursuant

41、 to Section 13(a)of the Exchange Act.Indicate by check mark whether the registrant has filed a report on and attestation to its managements assessment of the effectivenessof its internal control over financial reporting under Section 404(b)of the Sarbanes-Oxley Act(15 U.S.C.7262(b)by the registeredp

42、ublic accounting firm that prepared or issued its audit report.If securities are registered pursuant to Section 12(b)of the Act,indicate by check mark whether the financial statements of theregistrant included in the filing reflect the correction of an error to previously issued financial statements

43、.Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-basedcompensation received by any of the registrants executive officers during the relevant recovery period pursuant to 240.10D-1(b).Indicate by check mark whether the regis

44、trant is a shell company(as defined in Rule 12b-2 of the Exchange Act).Yes NoAs of June 28,2024,the last business day of the registrants most recently completed second fiscal quarter,the aggregate market value of the Registrants Class ACommon Stock held by non-affiliates was approximately$5,342,352,

45、777 and the aggregate market value of the registrants Class B Common Stock held by non-affiliates was approximately$28,604,722.As of February 11,2025,there were 22,940,805 shares of Class A Common Stock and 5,070,337 shares of Class B Common Stock outstanding.Documents Incorporated by ReferenceDocum

46、entForm 10-K Parts(1)Definitive Proxy Statement to be mailed to stockholders in connection with theregistrants 2025 Annual Meeting of Stockholders(specified portions)IIIBIO-RAD LABORATORIES,INC.FORM 10-K DECEMBER 31,2024TABLE OF CONTENTSPart I.3Item 1.Business3Item 1A.Risk Factors10Item 1B.Unresolve

47、d Staff Comments22Item 1C.Cybersecurity22Item 2.Properties23Item 3.Legal Proceedings24Item 4.Mine Safety Disclosures24Part II.24Item 5.Market for Registrants Common Equity,Related Stockholder Matters and Issuer Purchases ofEquity Securities24Item 6.Reserved25Item 7.Managements Discussion and Analysi

48、s of Financial Condition and Results of Operations25Item 7A.Quantitative and Qualitative Disclosures About Market Risk32Item 8.Financial Statements and Supplementary Data34Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure80Item 9A.Controls and Procedures80It

49、em 9B.Other Information81Item 9C.Disclosure Regarding Foreign Jurisdictions that Prevent Inspections81Part III.81Item 10.Directors,Executive Officers and Corporate Governance81Item 11.Executive Compensation82Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockhold

50、erMatters82Item 13.Certain Relationships and Related Transactions,and Director Independence83Item 14.Principal Accountant Fees and Services83Part IV.84Item 15.Exhibits and Financial Statement Schedules84Item 16.Form 10-K Summary88Signatures882INFORMATION RELATING TO FORWARD-LOOKING STATEMENTSOther t

51、han statements of historical fact,statements made in this report include forward-looking statements,withinthe meaning of the Private Securities Litigation Reform Act of 1995.These forward-looking statements include,without limitation,statements we make regarding our future financial performance,oper

52、ating results,plans andobjectives.Forward-looking statements generally can be identified by the use of forward-looking terminology,suchas“believe,”“expect,”“anticipate,”“may,”“will,”“intend,”“estimate,”“continue,”“seek,”“future,”or similarexpressions or the negative of those terms or expressions.Suc

53、h statements involve risks and uncertainties,whichcould cause actual results to vary materially from those expressed in or indicated by the forward-looking statements.We have based these forward-looking statements on our current expectations and projections about future events.However,actual results

54、 may differ materially from those currently anticipated depending on a variety of risk factorsincluding,but not limited to,the risks relating to our international operations,global economic and geopoliticalconditions,tariffs or other trade barriers,our ability to develop and market new or improved p

55、roducts,our ability tocompete effectively,foreign currency exchange fluctuations,reductions in government funding or capital spendingof our customers,supply chain issues,risks associated with our position in Sartorius AG,risks to our informationtechnology systems,intellectual property risks,our abil

56、ity to attract and retain key personnel,international legal andregulatory risks,product quality and liability issues,our ability to integrate acquired companies,products ortechnologies into our company successfully,changes in the healthcare industry,natural disasters and othercatastrophic events bey

57、ond our control,and other risks and uncertainties identified under“Part I,Item 1A,RiskFactors”and“Part II,Item 7,Managements Discussion and Analysis of Financial Condition and Results ofOperations”of this Annual Report.We caution you not to place undue reliance on forward-looking statements,which re

58、flect an analysis only and speak only as of the date hereof.We undertake no obligation to publicly updateor revise any forward-looking statements,whether as a result of new information,future events,or otherwise,exceptas required by law.PART I.ITEM 1.BUSINESSGeneralBio-Rad Laboratories,Inc.(referred

59、 to in this report as“Bio-Rad,”“we,”“us,”“the Company”and“our”)is amultinational developer,manufacturer,and worldwide distributor of our own life science research and clinicaldiagnostics products.Bio-Rad develops,manufactures,and supplies life science research,healthcare,analyticalchemistry and othe

60、r markets with a broad range of products and systems used to separate complex chemical andbiological materials and to identify,analyze and purify their components.We have direct distribution channels in over 36 countries outside the United States through subsidiaries whose focusis sales,customer ser

61、vice and product distribution.In some locations outside and inside these 36 countries,salesefforts are supplemented by distributors and agents.Description of BusinessBusiness SegmentsBio-Rad operates in two industry segments designated as Life Science and Clinical Diagnostics.Both segmentsoperate wo

62、rldwide.Our Life Science segment and our Clinical Diagnostics segment generated 40%and 60%,respectively,of our consolidated net sales for the year ended December 31,2024.We generated approximately 41%of our consolidated net sales for the year ended December 31,2024 from the U.S.and approximately 59%

63、from ourinternational locations,with Europe being our largest international region.Life Science SegmentOur Life Science segment is at the forefront of discovery,creating advanced tools to answer complex biologicalquestions.These instruments,systems,reagents,and consumables are typically used to sepa

64、rate,purify,characterize,or quantify biological materials such as cells,proteins,and nucleic acids in the research laboratory or3biopharmaceutical laboratory.They are also used in biopharmaceutical manufacturing,quality control process,foodsafety,and science education applications.We are focused on

65、the translational research market segment where ourproducts help accelerate the timelines from discovery in the lab to use in the clinic and with patients.We are aleader in the life sciences market and develop,manufacture and market a broad portfolio of many thousands ofproducts that serve a global

66、customer base.We estimate that the worldwide sales for products in the markets weserve is approximately$19 billion.Our principal life science customers include universities and medical schools,industrial research organizations,government agencies,pharmaceutical manufacturers,biotechnology researcher

67、s,food producers and food testing laboratories.Clinical Diagnostics SegmentOur Clinical Diagnostics segment designs,manufactures,markets and supports test systems,informatics systems,test kits and specialized quality controls that serve clinical laboratories in the global diagnostics market.Ourprodu

68、cts currently address specific niches within the in vitro diagnostics(IVD)test market,and we seek to focuson the higher margin,higher growth segments of this market.We supply several thousand products that cover more than 300 clinical diagnostic tests to the IVD test market.Weestimate that the world

69、wide sales for products in the markets we serve is approximately$16 billion.IVD tests areconducted outside the human body and are used to identify and measure substances in a patients tissue,blood orurine.Our products consist of reagents,instruments and software,typically provided to our customers a

70、s anintegrated package to allow them to generate reproducible test results.Revenue in this business is highly recurring,as laboratories typically standardize test methodologies,which are dependent on a particular suppliers equipment,reagent and consumable products.An installed base of diagnostic tes

71、t systems,therefore,typically creates arecurring source of revenue through the sale of test kits for each sample analyzed on an installed system.Ourprincipal clinical diagnostic customers include hospital laboratories,diagnostic reference laboratories,transfusionlaboratories and physician office lab

72、oratories.Raw Materials and ComponentsWe utilize a wide variety of chemicals,biological materials,electronic components,machined metal parts,opticalparts,computing and peripheral devices.Most of these materials and components are available from numeroussources,and in 2024,we generally have not exper

73、ienced difficulty in securing adequate supplies.In certaininstances,we acquire components and materials from a sole supplier.For more discussion relating to the risks to oursupply of raw materials,including the difficulty of securing adequate supplies,please see“Item 1A,Risk Factors”of this Annual R

74、eport.Patents,Trademarks and LicensesWe own over 2,150 U.S.and international patents and numerous trademarks.We also hold licenses under U.S.andforeign patents owned by third parties and pay royalties on the sales of certain products under these licenses.Inaddition,we also receive royalties for lice

75、nses of our intellectual property.We view these patents,trademarks andlicense agreements as valuable assets;however,we believe that our ability to develop and manufacture our productsdepends primarily on our knowledge,technology and special skills rather than our patent,trademark and licensingpositi

76、ons.Seasonal OperationsOur business is not inherently seasonal.However,the European custom of concentrating vacation during thesummer months usually tempers third quarter sales volume and operating income.Sales and MarketingWe conduct our worldwide operations through an extensive direct sales force,

77、employing approximately 800 directsales and sales management personnel around the world as of December 31,2024.Our sales personnel typicallyconsist of experienced industry professionals with scientific training,and we maintain a separate specialized sales4force for each of our segments.We believe th

78、at this direct sales approach allows us to sell a broader range of ourproducts,create more brand awareness,and develop long-term relationships with our customers.We also use a range of sales and marketing intermediaries(SMIs)in our international markets.The types of SMIswe utilize are distributors,a

79、gents,brokers and resellers.We have programs and policies in place with our SMIsrequiring their compliance with all applicable laws,including adhering to our anti-corruption standards to ensure atransparent sale to our customers.Our customer base is broad and diversified.Our worldwide customer base

80、includes(1)university and researchinstitutions;(2)hospital,public health and commercial laboratories;(3)diagnostic manufacturers;and(4)companies in the biotechnology,pharmaceutical,chemical and food industries.Our sales are affected by a number of external factors.For example,a number of our custome

81、rs,particularly in theLife Science segment,are substantially dependent on government grants and research contracts for their funding.Inour Clinical Diagnostic segment,we are constrained by government reimbursement for many of our products.CompetitionThe markets served by our product groups are highl

82、y competitive.Our competitors range in size from start-ups tolarge multinational corporations with significant resources and reach.We seek to compete primarily in marketsegments where the technology and efficacy of our products offer customers specific advantages over thecompetition.Our Life Science

83、 segment does not face the same competitors for all of its products due to the breadth of itsportfolio and specialization of its product lines.Major competitors in this market include Becton Dickinson,Danaher,Merck KGaA,Qiagen N.V.and Thermo Fisher Scientific.We compete primarily based on meetingper

84、formance specifications,technical support,and offering comprehensive solutions.Major competitors for our products in the Clinical Diagnostics segment include Abbott Laboratories,BectonDickinson,bioMrieux,Danaher,DiaSorin,Werfen,QuidelOrtho,Roche,Siemens Healthineers,Thermo FisherScientific and Tosoh

85、.We compete across a variety of attributes including quality,service and product portfolio.Research and DevelopmentWe conduct extensive research and development activities in all areas of our business.Research and developmenthas played a major role in Bio-Rads growth and is expected to continue to d

86、o so in the future.Our research teamsare continuously developing new products and new applications for existing products.In our development of newproducts and applications,we interact with scientific and medical professionals at pharma and biopharmacompanies,universities,hospitals,medical schools,an

87、d elsewhere within our industry.In addition,we regularlyinvest in companies that are engaged in the development of new technologies that either complement or expand ourexisting portfolio of products.As of December 31,2024,we had approximately 950 employees worldwide focusedon research and developmen

88、t,including degreed scientists,engineers,software developers and other technicalsupport staff.Regulatory MattersThe development,testing,manufacturing,marketing,post-market surveillance,distribution,advertising and labelingof certain of our products(primarily diagnostic and donor screening products)a

89、re subject to regulation in the UnitedStates by the Center for Devices and Radiological Health(CDRH)and/or the Center for Biologics Evaluation andResearch(CBER)of the U.S.Food and Drug Administration(FDA)and in other jurisdictions by state and foreigngovernment authorities.FDA regulations require th

90、at certain new products have pre-marketing notification(“510(k)”)or approval(“PMA”or Biologics License Application “BLA”)by the FDA and require certainproducts to be manufactured in accordance with FDAs“good manufacturing practice”regulations,to beextensively tested and to be properly labeled to dis

91、close test results and performance claims and limitations.The5FDAs 510(k)clearance process requires regulatory competence to execute.The FDAs PMA and BLA processesalso require extensive regulatory competence to execute.A clinical trial is generally required to support a PMA or BLA application and is

92、 sometimes required for a 510(k)clearance or a de novo authorization.Conducting clinical trials is a complex and costly activity and frequentlyrequires the use of outsourced resources that specialize in planning and conducting the clinical trial for the medicaldevice manufacturer.The European Union(

93、“EU”)has adopted the EU in-vitro Diagnostics Regulation(the“EU IVDR”),which imposesstricter requirements for the marketing and sale of in-vitro diagnostics products(as compared to the predecessor in-vitro Diagnostics Directive(IVDD),including in the areas of clinical evaluation requirements,quality

94、systems,economic operators and post-market surveillance.Bio-Rads IVD products currently meet the applicablerequirements of the EU IVDR.Our manufacturing facilities,as well as those of certain suppliers,are subject to periodic inspections by the FDAand other regulatory bodies to verify compliance wit

95、h regulatory requirements.Similar inspections are performedby Notified Bodies to verify compliance to applicable International Organization for Standardization(“ISO”)standards(e.g.ISO 13485:2016),requirements under the Medical Device Single Audit Program(MDSAP)applicable to regulatory requirements o

96、f Australia,Brazil,Canada,Japan and the U.S.and/or medical deviceregulations and requirements from the countries in which we distribute product and other specified audits byregulatory authorities.If a regulatory body were to find that we or certain suppliers have failed to comply withapplicable regu

97、lations(e.g.recordkeeping,reporting of adverse events),it could institute a wide variety ofenforcement actions,ranging from issuance of a warning or untitled letter to more severe sanctions,such asmandatory product recalls or seizures,civil penalties,consent decrees,injunctions,criminal prosecution,

98、operatingrestrictions,partial suspension or shutdown of production,refusal to permit importation or exportation,refusal togrant,or delays in granting,clearances or approvals or withdrawal or suspension of existing clearances or approvals.Any of these actions could have an adverse effect on our busin

99、ess.We are also subject to additional regulation and enforcement by the federal government and by authorities in thestates and foreign jurisdictions in which we conduct our business.Such laws include,without limitation,state andfederal anti-kickback,fraud and abuse,false claims,privacy and security

100、and physician sunshine laws andregulations.If our operations are found to be in violation of any such laws or any other governmental regulationsthat apply to us,we may be subject to penalties,including,without limitation,civil and criminal penalties,damages,fines,the curtailment or restructuring of

101、our operations,and exclusion from participation in federal and statehealthcare programs and imprisonment.Sales of our products will depend,in part,on the extent to which our products or diagnostic tests using our productswill be covered by third-party payors,such as government health care programs,c

102、ommercial insurance andmanaged healthcare organizations.These third-party payors are increasingly adjusting reimbursements for certainmedical products and services.In addition,the U.S.government,state legislatures and foreign governments havecontinued implementing cost containment programs,including

103、 price controls and restrictions on reimbursement.Adoption of price controls and cost-containment measures,and adoption of more restrictive policies in jurisdictionswith existing controls and measures,could further limit our net revenue and results.Decreases in third-partyreimbursement for our produ

104、cts or diagnostic tests using our products,or a decision by a third-party payor to notcover our products could reduce or eliminate utilization of our products and have a material adverse effect on oursales,results of operations and financial condition.In addition,healthcare reform measures have been

105、 and will beadopted in the future,any of which could limit the amounts that governments will pay for healthcare products andservices,which could result in reduced demand for our products or additional pricing pressures.As a multinational manufacturer and distributor of sophisticated instrumentation,

106、we must meet a wide array ofelectromagnetic compatibility and safety compliance requirements to satisfy regulations in the United States,theEuropean Union and other jurisdictions.6Our operations are subject to federal,state,local and foreign environmental laws and regulations that governactivities s

107、uch as transportation of goods,emissions to air and discharges to water,as well as handling and disposalpractices for solid,hazardous and medical wastes.In addition to environmental laws that regulate our operations,weare also subject to environmental laws and regulations that create liabilities and

108、 clean-up responsibility for spills,disposals or other releases of hazardous substances into the environment as a result of our operations or otherwiseimpacting real property that we own or operate.The environmental laws and regulations could also subject us toclaims by third parties for damages res

109、ulting from any spills,disposals or releases resulting from our operations orat any of our properties.These regulatory requirements vary widely among countries.Human Capital ResourcesAt Bio-Rad,we consider our employees to be our most valuable asset,and critical to the effective development,manufact

110、ure,sale,distribution and servicing of our vast array of products and services.Our employees are essentialto satisfying our customers needs for products to advance science and healthcare.At December 31,2024,we hadapproximately 7,700 employees,the overwhelming majority of which are full-time employee

111、s.Our employees arelocated throughout the world with roughly 48%in the Americas,35%in Europe,the Middle-East and Africa,and17%in Asia Pacific.Our employees work in 37 different countries around the world.We are a diverse organization.Our differences offer new and unique ideas and perspectives.We fos

112、ter a work culture that embraces the diverseexperience and knowledge of every employee.Compensation and BenefitsWe provide a competitive total rewards program consisting of broad-based salary and bonus plans as well as annualstock grants to senior level employees.These programs combine to recognize

113、and reward employees based onindividual,group,and overall company performance.We provide competitive health and welfare programs whichinclude medical,dental,vision and life insurance,a 401(k)plan,an employee stock purchase program,local pensionplans,profit sharing,employee assistance,child and elder

114、 care programs,employee recognition and a host of otherlocalized programs tied to the unique needs of our employees.Pay equity is an integral part of our compensationstrategy.We have established ongoing processes and protocols to help us pay each individual employeeappropriately based on the employe

115、es skills,performance,experience,location,market practices,etc.,regardless ofrace,gender,and other non-performance related attributes.In 2023,we introduced an upgraded and streamlinedmental health/Employee Assistance Program solution tailored to the need and preference of employees and families.In a

116、ddition,we added a fertility benefit giving employees access to a suite of services including pregnancyresources,in vitro fertilization(“IVF”),adoption,donor and surrogate services resources.Health,Wellness and SafetyThe health and welfare of our employees is of the highest importance to Bio-Rad.We

117、prioritize,manage,andcarefully track safety performance at all locations globally and integrate sound safety practices in every aspect ofour operations.We provide work site hazard evaluations,workplace safety surveys,safety equipment selection,safety program reviews,chemical exposure monitoring,safe

118、ty training,and disposal of hazardous chemical andinfectious waste.Training and Talent DevelopmentWe provide training programs for managers and employees to support their growth and development.Ourmanagement series of courses cover essential management and leadership learning to provide our managers

119、 with thenecessary skills and experience needed to more effectively lead and develop their teams.In addition,availablecourses for employees help them to be more effective at work,enhance interpersonal effectiveness,and help themachieve their full potential.We also support employees professional deve

120、lopment by providing a reimbursementprogram for qualified educational expenses.Investment in Sartorius AG7Sartorius AG(Sartorius)is an international laboratory and process technology provider for the biotech,pharmaceutical,and food industries.It operates in two divisions Bioprocess Solutions Divisio

121、n and Lab Products&Services Division.Sartorius is headquartered in Gottingen,Niedersachsen,Germany and has voting ordinaryshares as well as non-voting preference shares listed on XETRA and the Frankfurt Stock Exchanges.As of December 31,2024,we own 12,987,900 ordinary voting shares and 9,588,908 pre

122、ference shares of Sartorius,representing approximately 38%of the outstanding ordinary shares(excluding treasury shares)and 28%of thepreference shares of Sartorius.As of December 31,2024,the fair value of the investment in Sartorius was$4,469.2million.We account for our investment in Sartorius at fai

123、r market value and do not include any of the financialinformation summarized below in our consolidated financial statements.The following summarizes certain financial data of Sartorius as of and for the year ended December 31,2023(inmillions).December 31,2023(1)Current assets1,956.9Non-current asset

124、s7,798.5Current liabilities1,330.0Non-current liabilities5,667.9Equity2,757.4Year Ended December 31,2023(1)Sales revenue3,395.7Gross profit on sales1,561.7Earnings before interest and taxes(EBIT)503.9Net profit290.0Cash flow from operating activities853.6Cash flow from investing activities(2,823.3)C

125、ash flow from financing activities2,165.7(1)As disclosed in Sartorius AGs consolidated financial statements for the year ended December 31,2023,prepared in accordance with the International Financial Reporting Standards(IFRS),the InternationalFinancial Reporting Interpretations Committee(IFRIC)Stand

126、ards,and the International AccountingStandards Board(IASB)as required to be applied by the European Union,and based upon informationpublicly disclosed by Sartorius.Bio-Rad does not assume,and by way of referencing the financial data ofSartorius above shall not be deemed to assume,any responsibility

127、or liability for any errors or omissions inthe information publicly disclosed by Sartorius.Refer to Sartorius 2023 Annual Report for further details,which can be found at https:/ Sartorius website and any information disclosedthereon are not incorporated by reference into this report.The following g

128、raph reflects the changes in the Sartorius share price over the most recent five annual periods:8EUROSSartorius Stock PricePreference per share price(EUR)Ordinary per share price(EUR)201920202021202220232024100200300400500600700Available InformationBio-Rad files annual,quarterly,and current reports,

129、proxy statements,and other documents with the Securities andExchange Commission(SEC)under the Securities Exchange Act of 1934,as amended.The SEC maintains anInternet website that contains reports,proxy and information statements,and other information regarding issuers,including Bio-Rad,that file ele

130、ctronically with the SEC.The public can obtain any documents that we file with theSEC at http:/www.sec.gov.Bio-Rads website address is www.bio-.We make available,free of charge through our website,our Form10-Ks,10-Qs and 8-Ks,and any amendments to these reports,as soon as reasonably practicable afte

131、r filing with theSEC.The information on our website is not part of this Annual Report on Form 10-K.9ITEM 1A.RISK FACTORSIn evaluating our business and whether to invest in any of our securities,you should carefully read the followingrisk factors in addition to the other information contained in this

132、 report.We believe that any of the following risks(some of which have occurred and any of which may occur in the future)could have a material adverse effect onour business,results of operations or financial condition,our industry,the value of our equity holdings,or thetrading price of our common sto

133、ck.We operate in a continually changing business environment,and new risks anduncertainties emerge from time to time.We cannot predict these new risks and uncertainties,nor can we assess theextent to which any such new risks and uncertainties or the extent to which the risks and uncertainties set fo

134、rthbelow may adversely affect our business,results of operations,financial condition,our industry,the value of ourequity holdings,or the trading price of our common stock.Please carefully consider the following discussion ofsignificant factors,events and uncertainties that make an investment in our

135、securities risky and provide importantinformation for the understanding of the“forward-looking”statements discussed in this report.Additional orunforeseen effects from the global economic and geopolitical climate may give rise to or amplify many of theserisks discussed below.Business,Economic,Legal

136、and IndustryRisksOur international operations expose us to additional costs and legal and regulatory risks,which could have amaterial adverse effect on our business,results of operations and financial condition.We have significant international operations.We have direct distribution channels in over

137、 36 countries outside theUnited States,and during the twelve months ended December 31,2024 our foreign entities generated 59%of ournet sales.Compliance with complex foreign and U.S.laws and regulations that apply to our international operationsincreases our cost of doing business.These numerous and

138、sometimes conflicting laws and regulations include,among others,data privacy requirements,labor relations laws,tax laws,unfair competition regulations,import andtrade restrictions,tariffs,duties,quotas and other trade barriers,export requirements,U.S.laws such as the ForeignCorrupt Practices Act(FCP

139、A)and other U.S.federal laws and regulations established by the office of ForeignAsset Control,foreign laws such as the UK Bribery Act 2010 or other foreign laws which prohibit corrupt paymentsto governmental officials or certain payments or remunerations to customers.In addition,changes in laws orr

140、egulations potentially could be disruptive to our operations and business relationships in the affected regions.Given the high level of complexity of the foreign and U.S.laws and regulations that apply to our internationaloperations,we cannot guarantee that we have not or will not inadvertently brea

141、ch some provisions,for example,through fraudulent or negligent behavior of individual employees,our failure to comply with certain formaldocumentation requirements,or otherwise.In addition,we operate in some countries in which the businessenvironment is subject to a higher risk of corruption.Our suc

142、cess depends,in part,on our ability to anticipate theserisks and manage these challenges through policies,procedures and internal controls.However,we have a dispersedinternational sales organization,and we use distributors and agents in many of our international operations.Thisstructure makes it mor

143、e difficult for us to ensure that our international selling operations comply with laws andregulations,and our global policies and procedures.Violations of these laws and regulations could result in fines,criminal sanctions against us,our officers or ouremployees,requirements to obtain export licens

144、es,cessation of business activities in sanctioned countries,implementation of compliance programs,and prohibitions on the conduct of our business.Violations of laws andregulations also could result in prohibitions on our ability to offer our products in one or more countries and couldmaterially dama

145、ge our reputation,our brand,our international expansion efforts,our ability to attract and retainemployees,or our business,results of operations and financial condition.See also our risk factors regardinggovernment regulations and global economic conditions below.The industries and market segments i

146、n which we operate are highly competitive,and we may not be able tocompete effectively.The life science and clinical diagnostics markets are each highly competitive.Some of our competitors have greaterfinancial resources than we do,making them better equipped to license technologies and intellectual

147、 property fromthird parties or to fund research and development,manufacturing and marketing efforts,or to source high-demand10materials and components.Moreover,competitive and regulatory conditions in many markets in which we operaterestrict our ability to fully recover,through price increases,highe

148、r costs of acquired goods and services resultingfrom inflation and other drivers of cost increases.Many public tenders have become more competitive due togovernments lengthening the commitments of their public tenders to multiple years,which reduce the number oftenders in which we can participate an

149、nually.Because the value of these multiple-year tenders is so high,ourcompetitors have been more aggressive with their pricing.Our failure to compete effectively and/or pricingpressures resulting from competition could adversely affect our business,results of operations and financialcondition.We may

150、 not be able to grow our business because of our failure to develop new or improved products.Our future growth depends in part on our ability to continue to improve our product offerings and develop andintroduce new products that integrate technological advances.If we are unable to integrate technol

151、ogical advancesinto our product offerings or to design,develop,manufacture and market new products successfully and in a timelymanner,our business,results of operations and financial condition will be adversely affected.Supply chaindisruptions have caused some delays to our ability to develop and in

152、troduce new products.We have experiencedproduct launch delays in the past and may do so in the future.We cannot assure you that our product and processdevelopment efforts will be successful or that new products we introduce will achieve market acceptance.Failure tolaunch successful new products or i

153、mprovements to existing products may cause our products to become obsolete,which could harm our business,results of operations and financial condition.Global economic and geopolitical conditions could adversely affect our operations.In recent years,we have been faced with challenging global economic

154、 conditions.U.S.and international marketshave experienced inflationary pressures,and inflation rates in the U.S.and in other countries in which we operatehave been at elevated levels.Our raw material costs have increased,and we are not always able to recover theseincreased costs from our customers.R

155、ussias invasion of Ukraine and sanctions against Russia have causeddisruptions to global economic conditions and are negatively impacting our business in Russia.Conflicts in theMiddle East have also caused some disruptions to the global business environment(including impactinginternational logistics

156、),the stability of the Middle East region and our business in that region.It is unknown howlong any of these disruptions will continue and whether such disruptions will become more severe.In addition,weexpect moderating economic growth and changing government policies in China will continue to affec

157、t ourcommercial opportunities in the country.The bank failures in March 2023 and the resulting volatility in the bankingsector caused and could continue to cause disruptions to global economic conditions and may impact access to cashand other financial resources by us,our customers and our suppliers

158、.A deterioration in the global economicenvironment may result in a decrease in demand for our products,increased competition,downward pressure onprices for our products and longer sales cycles.A weakening of macroeconomic conditions is also adverselyaffecting our suppliers,which could continue to re

159、sult in interruptions in the supply of components and rawmaterials necessary for our products and raw material cost increases.Additionally,the United States and othercountries have imposed tariffs on certain goods.Further escalation of tariffs or other trade barriers could adverselyimpact our profit

160、ability and/or our competitiveness.See also our risk factors regarding our international operationsabove and regarding government regulations below.Reductions in government funding and the capital spending programs of our customers could have a materialadverse effect on our business,results of opera

161、tions or financial condition.Our customers include universities,clinical diagnostics laboratories,government agencies,hospitals andpharmaceutical,biotechnology and chemical companies.The capital spending programs of these institutions andcompanies have a significant effect on the demand for our prod

162、ucts.Such programs are based on a wide variety offactors,including the resources available to make such purchases,the availability of funding from grants bygovernments or government agencies,the spending priorities for various types of equipment and the policiesregarding capital expenditures during

163、industry downturns or recessionary periods.If funding to our customers wereto decrease,or if our customers were to decrease or reallocate their budgets in a manner adverse to us,our business,results of operations or financial condition could be materially and adversely affected.11A reduction or inte

164、rruption in the supply of components and raw materials has adversely affected and couldcontinue to adversely affect our manufacturing operations and related product sales.The manufacture of our products requires the timely delivery of sufficient amounts of quality components andmaterials.We manufact

165、ure our products around the world.We acquire our components and materials from manysuppliers in various countries.We work closely with our suppliers to ensure the continuity of supply,but we cannotguarantee these efforts will always be successful.Further,while we seek to diversify our sources of com

166、ponents andmaterials,in certain instances we acquire components and materials from a sole supplier.The COVID-19 pandemiccreated delays and shortages in the supply of components and raw materials.These shortages,along with challengesin ramping up new production facilities,caused a backlog of sales or

167、ders,some of which we consider to besignificant,and delays in certain new product development activities.Some of the backlog of sales orders continuedinto 2023 but moderated in 2024 to a more typical level.We have experienced raw material cost increases,some ofwhich will likely continue.In addition,

168、due to the regulatory environment in which we operate,we may need tocease use of certain essential components and materials and be unable to establish acceptable replacement sourcesfor such components or materials.When our supply is reduced or interrupted or of poor quality,and we are unableto devel

169、op alternative sources for such supply,our ability to manufacture our products in a timely or cost-effectivemanner is adversely affected,which affects our ability to sell our products.Breaches of our information systems could have a material adverse effect on our business and results ofoperations.We

170、 have experienced and expect to continue to experience attempts by individuals and organizations to attack andpenetrate our layered security controls.Through our sales and eCommerce channels,we collect and storeconfidential information that customers provide to,among other things,purchase products o

171、r services,enroll inpromotional programs and register on our web site.We also acquire and retain information about suppliers andemployees in the normal course of business.Such information on our systems includes personally identifiableinformation and,in limited instances,protected health information

172、.We also create and maintain proprietaryinformation that is critical to our business,such as our product designs and manufacturing processes.Despite recentinitiatives to improve our technology systems,such as our enterprise resource planning implementation and thecentralization of our global informa

173、tion technology organization,we could experience a significant data securitybreach.The Company is also subject to phishing and other fraud schemes including fraudulent vendorcommunications with requests for payments and fraudulent attempts to redirect payments to improper bankaccounts,some of which

174、have been successful.While the Company has adopted training and process changes tolimit the success of such fraudulent activity,the Company will be unable to stop all such fraudulent activity whichmay lead to unrecoverable payments to criminal accounts.Because the techniques used to obtain unauthori

175、zedaccess,disable or degrade service,or sabotage systems change frequently and often are not recognized untillaunched against a target,we may not be able to anticipate all of these techniques or to implement adequatepreventive measures.Computer hackers have attempted to penetrate and will likely con

176、tinue to attempt to penetrateour and our vendors information systems and,if successful,could misappropriate confidential customer,supplier,employee or other proprietary business information,such as our intellectual property.Third parties could also gaincontrol of our systems and use them for crimina

177、l purposes while appearing to be us.As a result,we could loseexisting customers,have difficulty attracting new customers,be exposed to claims from customers and suppliers,financial institutions,payment card associations,employees and other persons,have regulatory sanctions orpenalties imposed,incur

178、additional expenses or lose revenues as a result of a data privacy breach,or suffer otheradverse consequences.Our operations and ability to process sales orders,particularly through our eCommercechannels,could also be disrupted,as they have been in the past.Any significant breakdown,intrusion,interr

179、uption,corruption,or destruction of our systems,as well as any data breaches,could have a material adverse effect on ourbusiness and results of operations.See also our risk factors regarding our information technology systems below.If our information technology systems are disrupted,or if we fail to

180、 successfully implement,manage andintegrate our information technology and reporting systems,our business,results of operations and financialcondition could be harmed.Our information technology(IT)systems are an integral part of our business,and a significant disruption of our ITsystems(which increa

181、singly include cloud-based systems provided by third party vendors)could have a materialadverse effect on our business,results of operations and financial condition.We depend on our IT systems to12process orders,manage inventory,pay our vendors and collect accounts receivable.Our IT systems also all

182、ow us toefficiently purchase products from our suppliers and ship products to our customers on a timely basis,maintain cost-effective operations and provide customer service.We cannot assure you that our contingency plans will allow us tooperate at our current level of efficiency.Our ability to impl

183、ement our business plan in a rapidly evolving market requires effective planning,reporting andanalytical processes.We expect that we will need to continue to improve and further integrate our IT systems,reporting systems and operating procedures by training and educating our employees with respect t

184、o theseimprovements and integrations on an ongoing basis in order to effectively run our business.We may sufferinterruptions in service,loss of data or reduced functionality when we upgrade or change systems or migrate tocloud-based systems.If we fail to successfully manage and integrate our IT syst

185、ems,reporting systems andoperating procedures,it could adversely affect our business,results of operations and financial condition.See alsoour risk factors regarding our data security above and events beyond our control below.We are subject to foreign currency exchange fluctuations,which could have

186、a material adverse effect on ourresults of operations and financial condition.A significant portion of our operations and sales are outside of the United States.When we make purchases andsales in currencies other than the U.S.dollars,we are exposed to fluctuations in foreign currencies relative to t

187、heU.S.dollar that may adversely affect our results of operations and financial condition.Our international sales arelargely denominated in local currencies.As a result,the strengthening of the U.S.dollar negatively impacts ourconsolidated net sales expressed in U.S.dollars.Conversely,when the U.S.do

188、llar weakens,our expenses at ourinternational sites increase.In addition,the volatility of other currencies may negatively impact our operationsoutside of the United States and increase our costs to hedge against currency fluctuations.In addition,we holdinvestments and a loan receivable that are sub

189、ject to foreign exchange fluctuations.We cannot assure you that futureshifts in currency exchange rates will not have a material adverse effect on our results of operations and financialcondition.Changes in the market value of our position in Sartorius AG materially impact our financial results.Chan

190、ges in the market value of our position in Sartorius AG will continue to materially impact our consolidatedstatements of income(loss)and other financial statements.A decline in the market value of our position in SartoriusAG will result in decreases in net income due to write-downs in the value of t

191、he equity securities.An increase in themarket value of our position in Sartorius AG will result in a favorable impact to net income independent of theactual operating performance of our business.Depending on the extent of the decline or of the increase in themarket value of our position in Sartorius

192、 AG,these negative or positive impacts on us could continue to be material.Our share price may change significantly based upon changes in the market value of our position in Sartorius AG,independent of the actual performance of our business.Additionally,non-operating income for a period may besignif

193、icantly impacted by any distribution of dividends by Sartorius AG,particularly when the dividends amountvaries in comparison to prior year periods.The value of our position in Sartorius AG might cause us to be deemed an investment company under theInvestment Company Act of 1940.As a result of the ma

194、rket value of our position in Sartorius AG,we might be deemed to be an“investment company”under Section 3(a)(1)(C)of the Investment Company Act of 1940,as amended(the“Investment Company Act”).The Company does not believe it is an investment company primarily in reliance on Section 3(b)(1)of theInves

195、tment Company Act because we are“primarily engaged”in a business other than that of investing,reinvesting,owning,holding or trading in securities.Rather,we are primarily engaged in the development,manufacturing andmarketing of products for the life science research and clinical diagnostic markets,an

196、d we believe that our historicaldevelopment,our public representations of policy,the activity of our officers and directors,the nature of our presentassets,the sources of our present income,and the public perception of the nature of our business all support theconclusion that we are an operating com

197、pany and not an investment company.Although we have discussed thisissue with the staff of the SEC and we are comfortable with our position,if it is determined later that the Companymay not rely on Section 3(b)(1)or any other exemption under the Investment Company Act and the Company weredeemed to be

198、 an unregistered investment company,such determination would have a material adverse effect on ourbusiness as we would need to register as an investment company and be subject to the regulations of the Investment13Company Act which are designed to restrict and regulate mutual funds rather than opera

199、ting companies.It couldalso call into question the validity of all contracts to which the Company is a party.If it appeared likely that wewould be deemed to be an investment company,we may modify our position in Sartorius AG in order to avoid suchdetermination.We have incurred and may continue to in

200、cur losses in future periods due to write-downs in the value of ourfinancial instruments.We have positions in a variety of financial instruments including asset backed securities and other similarinvestments.Financial markets are volatile and the markets for these securities can be illiquid.The valu

201、e of thesesecurities will continue to be impacted by external market factors including default rates,changes in the value of theunderlying property,such as residential or commercial real estate,rating agency actions,the prices at whichobservable market transactions occur and the financial strength o

202、f various entities,such as financial guarantors whoprovide insurance for the securities.Should we need to convert these positions to cash,we may not be able to sellthese instruments without significant losses due to current debtor financial conditions,low trading volume of thesecurities,or other mar

203、ket considerations.As discussed further in the Notes to Consolidated Financial Statements,in Note 2.Fair Value Measurements andInvestments,under the heading“Level 3 Fair Value Investments”,we made a loan of 400 million Euros to Sartorius-Herbst Beteiligungen II GmbH in November 2021 that is secured

204、by the pledge of certain trust interests which upontermination of the trust represent the right to receive Sartorius ordinary shares(the Loan).Prior to a termination ofthe trust,the trust interests,which are provided as collateral for the Loan,are not tradable on the capital markets andmay,in case o

205、f an enforcement,have to be sold with a significant discount to the value of the underlying shares.We also have positions in equity securities,including our position in Sartorius AG.Financial markets are volatileand the markets for these equity securities can be illiquid as well.A decline in the mar

206、ket value of our investmentsin equity securities has resulted and could continue to result in significant losses due to write-downs in the value ofthe equity securities.Also,if we need to convert these positions to cash,we may not be able to sell these equitysecurities without significant losses.In

207、addition,significant declines in the value of the Sartorius ordinary shareshave reduced the value of the collateral for the Loan discussed in the previous paragraph.The value of the collateralmay be insufficient to cover the repayment of the Loan if the decline in value continues,and Sartorius-Herbs

208、tBeteiligungen II GmbH will likely have no other assets from which to repay the Loan.Furthermore,the change inthe market value of Sartorius ordinary shares will have an impact on the value appreciation rights acquired inconnection with the Loan discussed in the previous paragraph.Recent and planned

209、changes to our organizational structure could negatively impact our business.We made significant changes to our organizational structure over the past few years,including the reorganization ofaspects of our European operations that was announced in February 2021 and additional restructurings approve

210、d in2023,2024,and 2025.These changes may have unintended consequences,such as distraction of our managementand employees,labor unrest,business disruption,disruption of supply,attrition of our workforce,inability to attractor retain key employees,and reduced employee morale or productivity.Risks rela

211、ting to intellectual property rights may negatively impact our business.We rely on a combination of copyright,trade secret,patent and trademark laws and third-party nondisclosureagreements to protect our intellectual property rights and products.However,we cannot assure you that ourintellectual prop

212、erty rights will not be challenged,invalidated,circumvented or rendered unenforceable,or thatmeaningful protection or adequate remedies will be available to us.Unauthorized third parties have attempted tocopy our intellectual property,reverse engineer or obtain and use information that we regard as

213、proprietary,or havedeveloped equivalent technologies independently,and may do so in the future.Additionally,third parties haveasserted patent,copyright and other intellectual property rights to technologies that are important to us and may doso in the future.If we are unable to license or otherwise

214、access protected technology used in our products,or if welose our rights under any existing licenses,we could be prohibited from manufacturing and marketing suchproducts.From time to time,we also must enforce our patents or other intellectual property rights or defendourselves against claimed infrin

215、gement of the rights of others through litigation.As a result,we could incursubstantial costs,be forced to redesign our products,or be required to pay damages or royalties to an infringed14party.Any of the foregoing matters could adversely impact our business,results of operations and financialcondi

216、tion.Changes in the healthcare industry could have an adverse effect on our business,results of operations andfinancial condition.There have been,and will continue to be,significant changes in the healthcare industry in an effort to reduce costs.These changes include:The trend towards managed care,t

217、ogether with healthcare reform of the delivery system in the UnitedStates and efforts to reform in Europe,has resulted in increased pressure on healthcare providers and otherparticipants in the healthcare industry to reduce selling prices.Consolidation among healthcare providersand consolidation amo

218、ng other participants in the healthcare industry has resulted in fewer,more powerfulgroups,whose purchasing power gives them cost containment leverage.In particular,there has been aconsolidation of laboratories and a consolidation of blood transfusion centers.These industry trends andcompetitive for

219、ces place constraints on the levels of overall pricing and thus could have a material adverseeffect on our gross margins for products we sell in clinical diagnostic markets.Third party payors,such as Medicare and Medicaid in the United States,have reduced their reimbursementsfor certain medical prod

220、ucts and services.Our Clinical Diagnostics business is impacted by the level ofreimbursement available for clinical tests from third party payors.In the United States payment for manydiagnostic tests furnished to Medicare fee-for-service beneficiaries is made based on the Medicare ClinicalLaboratory

221、 Fee Schedule(CLFS),a fee schedule established and adjusted from time to time by the Centersfor Medicare and Medicaid Services(CMS).Some commercial payors are guided by the CLFS inestablishing their reimbursement rates.Laboratories and clinicians may decide not to order or performcertain clinical di

222、agnostic tests if third party payments are inadequate,and we cannot predict whether thirdparty payors will offer adequate reimbursement for tests utilizing our products to make them commerciallyattractive.Legislation,such as the Patient Protection and Affordable Care Act,as amended by the HealthCare

223、 and Education Reconciliation Act(PPACA)and the Middle Class Tax Relief and Job Creation Act of2012,has reduced the payments for clinical laboratory services paid under the CLFS.In addition,theProtecting Access to Medicare Act of 2014(PAMA)has made significant changes to the way Medicare willpay for

224、 clinical laboratory services,which has further reduced reimbursement rates.To the extent that the healthcare industry seeks to address the need to contain costs stemming from reform measuressuch as those contained in the PPACA and the PAMA,or in future legislation,by limiting the number of clinical

225、tests being performed or the amount of reimbursement available for such tests,our business,results of operationsand financial condition could be adversely affected.If these changes in the healthcare markets in the United Statesand Europe continue,we could be forced to alter our approach in selling,m

226、arketing,distributing and servicing ourproducts.We are subject to substantial government regulation,and any changes in regulation or violations of regulationsby us could adversely affect our business,prospects,results of operations or financial condition.Some of our products(primarily our Clinical D

227、iagnostic products),production processes and marketing are subjectto U.S.federal,state and local,and foreign regulation,including by the Food and Drug Administration(FDA)inthe United States and its foreign counterparts.The FDA regulates our Clinical Diagnostic products as medicaldevices,and we are s

228、ubject to significant regulatory clearances or approvals to market our Clinical Diagnosticproducts and other requirements including,for example,recordkeeping and reporting requirements,such as theFDAs medical device reporting regulations and reporting of corrections and removals.The FDA has broadreg

229、ulatory and enforcement powers.If the FDA determines that we have failed to comply with applicable regulatoryrequirements,it can impose a variety of enforcement actions ranging from public warning letters,fines,injunctions,consent decrees and civil penalties to suspension or delayed issuance of appr

230、ovals,seizure or recall of our products,total or partial shutdown of production,withdrawal of approvals or clearances already granted,and criminalprosecution.15The FDA can also require us to repair,replace or refund the cost of devices that we manufactured or distributed.Inaddition,the FDA may chang

231、e its clearance and approval policies,adopt additional regulations or revise existingregulations,or take other actions,which may prevent or delay approval or clearance of our products or impact ourability to modify our currently approved or cleared products on a timely basis.Any delay in,or failure

232、to receive ormaintain,clearance or approval for our products or changes in regulation could prevent us from generating revenuefrom these products and adversely affect our business operations and financial results.Additionally,the FDA andother regulatory authorities have broad enforcement powers.Regu

233、latory enforcement or inquiries,or other increasedscrutiny on us,could affect the perceived safety and efficacy of our products and dissuade our customers from usingour products.The FDA has issued a final rule applicable to certain clinical diagnostic products referred to as laboratory developedtest

234、s.This change in the FDA approach could negatively impact our customers who use our Life Science productsfor laboratory developed tests.Many foreign governments have similar rules and regulations regarding the importation,registration,labeling,saleand use of our products.Such agencies may also impos

235、e new requirements that may require us to modify or re-register products already on the market or otherwise impact our ability to market our products in those countries.The EU in-vitro Diagnostics Regulation(the“EU IVDR”)includes broad changes regarding in vitro diagnosticdevices and medical devices

236、.The EU IVDR required us to modify or re-register some products,and we expect willcontinue to result in additional costs for ongoing compliance.In addition,Russia has enacted more stringent medicalproduct registration and labeling regulations,China has enacted stricter labeling requirements,and we e

237、xpect othercountries,such as Brazil and India,to impose more regulations that impact our product registrations.The UnitedKingdoms withdrawal from the EU is resulting in additional regulatory requirements associated with goodsmanufactured and sold in the United Kingdom and additional complexities and

238、 delays with respect to goods,rawmaterials and personnel moving between the United Kingdom and the EU.In addition,new governmentadministrations may interpret existing regulations or practices differently.Due to these evolving and diverserequirements,we face uncertain product approval timelines,addit

239、ional time and effort to comply,as well as thepotential for reduced sales and/or fines for noncompliance.Increasing protectionism in such countries also impedesour ability to compete with local companies.We may not be able to participate in certain public tenders in China,India and Russia because of

240、 increasing measures to restrict access to such tenders for companies without localmanufacturing capabilities.Such regulations could adversely affect our business,results of operations and financialcondition.See also our risk factors regarding our international operations and regarding global econom

241、ic andgeopolitical conditions above.We are also subject to government regulation of the use and handling of a number of materials and controlledsubstances.The U.S.Drug Enforcement Administration establishes registration,security,recordkeeping,reporting,storage,distribution and other requirements for

242、 controlled substances pursuant to the Controlled Substances Act of1970.Failure to comply with present or future laws and regulations could result in substantial liability to us,suspension or cessation of our operations,restrictions on our ability to expand at our present locations or require usto m

243、ake significant capital expenditures or incur other significant expenses.We cannot assure you that we will be able to integrate acquired companies,products or technologies into ourcompany successfully,or that we will be able to realize the anticipated benefits from the acquisitions.As part of our ov

244、erall business strategy,we pursue acquisitions of and investments in complementary companies,products and technologies.The benefits of any acquisition or investment may prove to be less than anticipated,which we have experienced in some of our acquisitions and investments,and may not outweigh the co

245、sts reported inour financial statements.Completing any potential future acquisitions could cause significant diversion of ourmanagements time and resources.If we acquire or invest in new companies,products or technologies,we may berequired to assume contingent liabilities or record impairment charge

246、s for goodwill and other intangible assets overtime.Goodwill and non-amortizable intangible assets are subject to impairment testing,and potential periodicgoodwill impairment charges,amortization expenses related to certain intangible assets,and other write-offs couldharm our operating results.Impai

247、rment tests are highly sensitive to changes in assumptions and minor changes toassumptions could result in impairment losses.If the results forecast in our impairment tests are not achieved,orbusiness trends vary from the assumptions used in forecasts,or external factors change detrimentally,futurei

248、mpairment losses may occur,as they have occurred in the past,which may result in some volatility to ourconsolidated statements of income(loss).Increased antitrust enforcement and greater government scrutiny of16mergers in the healthcare sector may impact our ability to consummate acquisitions.We can

249、not assure you that wewill successfully overcome these risks or any other problems we encounter in connection with any acquisitions orinvestments,and any such acquisitions or investments could adversely affect our business,results of operations andfinancial condition.Product quality and liability is

250、sues could harm our reputation and negatively impact our business,results ofoperations and financial condition.We must adequately address quality issues associated with our products,including defects in our engineering,design and manufacturing processes,as well as defects in third-party components i

251、ncluded in our products.Ourinstruments,reagents and consumables are complex,and identifying the root cause of quality issues,especiallythose affecting reagents or third-party components,is difficult.We may incur significant costs and expendsubstantial time in researching and remediating such issues.

252、Quality issues could also delay our launching ormanufacturing of new products.In addition,quality issues,unapproved uses of our products,or inadequatedisclosure of risks related to our products,could result in product recalls or product liability or other claims beingbrought against us.In responding

253、 to shortages,we may source components from alternative suppliers anddistributors.Quality issues associated with components from these alternative sources may lead to product failuresand associated costs notwithstanding our efforts to detect and remediate such quality issues.These issues couldharm o

254、ur reputation,impair our relationship with existing customers and harm our ability to attract new customers,which could negatively impact our business,results of operations and financial condition.Lack of key personnel could hurt our business.Our products are very technical in nature,and we operate

255、in a complex and competitive business environment.Ingeneral,only highly qualified and well-trained scientists,technicians and other specialized individuals have thenecessary skills to develop,market and sell our products,and many of our manufacturing positions require veryspecialized knowledge and s

256、kills.In addition,the global nature of our business also requires that we havesophisticated and experienced staff to comply with increasingly complex international laws and regulations.Weface intense competition for these professionals from our competitors,customers,marketing partners and othercompa

257、nies throughout our industry.If we do not offer competitive compensation and benefits,we may fail to retainor attract a sufficient number of qualified personnel,which could impair our ability to properly run our business.Further,our ability to successfully execute organizational changes,including ma

258、nagement transitions within oursenior leadership team,are critical to our business success.If we are not able to fully integrate new executives,thesechanges could impact our ability to successfully execute our business strategy,which could adversely affect ourbusiness,results of operations and finan

259、cial condition.We may have higher than anticipated tax liabilities.We are subject to income taxes in the United States and many foreign jurisdictions.We report our results ofoperations based on our determination of the amount of taxes owed in various tax jurisdictions in which we operate.The determi

260、nation of our worldwide provision for income taxes and other tax liabilities requires estimation,judgment and calculations where the ultimate tax determination may not be certain.Determination of our taxliabilities is subject to review or examination by tax authorities in various tax jurisdictions.T

261、ax authorities havedisagreed with our judgment in the past and may disagree with positions we take in the future resulting inassessments of additional taxes.Any adverse outcome of such review or examination could have a negative impacton our operating results and financial condition.Economic and pol

262、itical pressures to increase tax revenues in various jurisdictions may make resolving tax disputesmore difficult.In recent years,the tax authorities in Europe have disagreed with our tax positions related to hybriddebt,research and development credits,transfer pricing and indirect taxes,among others

263、.We regularly assess thelikelihood of the outcome resulting from these examinations to determine the adequacy of our provision for incometaxes.Although we believe our tax estimates are reasonable,the final determination of tax audits and any relatedlitigation could be materially different from our h

264、istorical income tax provisions and accruals.Changes in tax laws or rates,changes in the interpretation of tax laws or changes in the jurisdictional mix of ourearnings could adversely affect our financial position and results of operations.17On December 22,2017,the U.S.enacted comprehensive tax legi

265、slation commonly referred to as the Tax Cuts andJobs Act(the“Tax Act”)which made a number of substantial changes to how the United States imposes income taxon multinational corporations.The U.S Treasury,Internal Revenue Service and other standard setting bodiescontinue to issue guidance and interpre

266、tation relating to the Tax Act.As future guidance is issued,we may makeadjustments to amounts previously reported that could materially impact our financial statements.On August 16,2022,President Biden signed into law the Inflation Reduction Act of 2022,which included anAlternative Minimum Tax based

267、 on the Adjusted Financial Statement Income of Applicable Corporations.We donot believe the Inflation Reduction Act will have a material impact on our income tax provision and cash taxes,butwe continue to monitor U.S.Department of the Treasury guidance and regulations.The tax effect of our position

268、in Sartorius AG and the jurisdictional mix of our earnings could continue to materiallyaffect our financial results and cash flow.In addition,the adoption of some or all of the recommendations set forthin the Organization for Economic Co-operation and Development(OECD)s project on“Base Erosion and P

269、rofitShifting”(BEPS)by tax authorities in the countries in which we operate,could negatively impact our effective taxrate.These recommendations focus on payments from affiliates in high tax jurisdictions to affiliates in lower taxjurisdictions and the activities that give rise to a taxable presence

270、in a particular country.On October 8,2021,the OECD announced that 136 countries have agreed on a two-pillar framework that woulddramatically alter the taxation of multinational enterprises and require that all profit be subject to a global minimumtax rate of 15%.On December 15,2022,the European Unio

271、n formally adopted the Pillar Two Directive and EUmember states enacted the Pillar Two Directive as of January 1,2024.Other countries have taken similar actions.We currently believe Pillar 2 legislation will not have a material impact on our income tax provision and cash taxes.Environmental,health a

272、nd safety regulations and enforcement proceedings may negatively impact our business,results of operations and financial condition.Our operations are subject to federal,state,local and foreign environmental laws and regulations that govern suchactivities as transportation of goods,materials that we

273、use in our products,emissions to air and discharges to water,as well as handling and disposal practices for solid,hazardous and medical wastes.In addition to environmentallaws that regulate our operations,we are also subject to environmental laws and regulations that create liability andresponsibili

274、ty for spills,disposals or other releases of hazardous substances into the environment as a result of ouroperations or otherwise impacting real property that we own or operate.The environmental laws and regulationsalso subject us to claims by third parties for damages resulting from any spills,dispo

275、sals or releases resulting fromour operations or at any of our properties.We must also comply with various health and safety regulations in theUnited States and abroad in connection with our operations.We may in the future incur capital and operating costs to comply with currently existing laws and

276、regulations,andpossible new statutory enactments,and these expenditures may be significant.We have incurred,and may in thefuture incur,fines related to environmental matters and/or liability for costs or damages related to spills or otherreleases of hazardous substances into the environment at sites

277、 where we have operated,or at off-site locations wherewe have sent hazardous substances for disposal.We cannot assure you,however,that such matters or any futureobligations to comply with environmental or health and safety laws and regulations will not adversely affect ourbusiness,results of operati

278、ons or financial condition.In addition,there is an increasing focus by U.S.and international regulators,investors,customers,and otherstakeholders on environmental,social and governance(ESG)matters.Complying with new laws or regulationsconcerning sustainability matters,climate related matters or othe

279、r ESG matters will result in increased compliancecosts and create additional non-compliance risks.Failure to adequately meet our stakeholders expectations orcomply with any such laws or regulations may result in loss of business,reputational damage,an inability to attractcustomers,an inability to at

280、tract and retain top talent,and a negative impact on our business,results of operationsand financial condition.18We also have announced certain sustainability goals,which require ongoing investment and operational changes.Our efforts may not achieve their intended outcomes,and we may not achieve suc

281、h goals,which could negativelyimpact our reputation and business.Use of generative AI and other AI technologies presents risks and challenges due to the evolving nature of AI.We utilize artificial intelligence and machine learning technologies(“AI”),such as chatbots,assistants andautomation agents,i

282、n our business operations,and we are exploring the other opportunities that AI could bring us.The use of AI,particularly generative AI,and the developing regulatory landscape,pose risks that could expose usto liability or adversely affect our business.Integration of AI into our and our vendors syste

283、ms(potentially withoutthe vendor disclosing such use to us)subjects us to the risk that the providers of AI may not meet existing or rapidlyevolving regulatory or industry standards with respect to privacy and data protection.This may lead to loss ofintellectual property or exposure of confidential

284、or proprietary information,breaches of security or privacy,andreduced levels of service or experience.Sophisticated cyberattacks,including those using AI,could increase theserisks.Generative AI can produce false or misleading outputs,or generate content that may not be subject tointellectual propert

285、y protection or that infringes proprietary rights of others,and thereby present additional risks toour business.Regulatory changes or reinterpretations could introduce new compliance risks,including potentialgovernment enforcement actions or civil lawsuits.In addition,a failure to timely and effecti

286、vely use or deploy AIand integrate it into new product offerings and services could negatively impact our competitiveness,particularlyahead of developing consumer demands and evolving industry trends.Our competitors faster or more effectiveadoption of AI also could disadvantage us.Our current and fu

287、ture debt and related covenants may restrict our future operations.We have substantial debt and have the ability to incur additional debt.As of December 31,2024,we hadapproximately$1.2 billion of outstanding long-term indebtedness,primarily consisting of the 3.3%Senior Notesdue in March 2027 and the

288、 3.7%Senior Notes due in March 2032 as further discussed in Note 6 of the consolidatedfinancial statements.In addition,we have a revolving credit facility that provides for up to$200.0 million inborrowing capacity,$5.7 million of which was utilized for domestic standby letters of credit as of Decemb

289、er 31,2024.Our incurrence of substantial amounts of debt may have important consequences.For instance,it could:make it more difficult for us to satisfy our financial obligations,including those relating to our outstandingdebt;require us to dedicate a substantial portion of our cash flow from operati

290、ons to the payment of interest andprincipal due under our debt,which will reduce funds available for other business purposes;increase our vulnerability to general adverse economic and industry conditions;limit our flexibility in planning for,or reacting to,changes in our business and the industries

291、in which weoperate;place us at a competitive disadvantage compared with some of our competitors that have less debt;andlimit our ability to obtain additional financing required to fund working capital and capital expenditures andfor other general corporate purposes.Our existing credit facility,our S

292、enior Notes and agreements we may enter in the future,contain or may containcovenants imposing restrictions on our business.These restrictions may affect our ability to operate our businessand may limit our ability to take advantage of potential business opportunities as they arise.Existing covenant

293、splace restrictions on our ability to,among other things:incur additional debt;acquire other businesses or assetsthrough merger or purchase;create liens;enter into transactions with affiliates;sell assets;and in the case of someof our subsidiaries,guarantee debt.Our existing credit facility also req

294、uires that we comply with a maximumconsolidated leverage ratio test.Our ability to comply with these covenants may be affected by events beyond ourcontrol,including prevailing economic,financial and industry conditions.The breach of any of these restrictionscould result in a default.An event of defa

295、ult under our debt agreements would permit certain of our lenders todeclare all amounts borrowed from them to be due and payable,together with accrued and unpaid interest.19We are subject to healthcare laws and regulations and could face substantial penalties if we are unable to fullycomply with suc

296、h laws.We are subject to healthcare regulation and enforcement by both the U.S.federal government and the U.S.statesand foreign governments in which we conduct our business.These healthcare laws and regulations include,forexample:the U.S.federal Anti-Kickback Statute,which prohibits,among other thin

297、gs,persons or entities fromsoliciting,receiving,offering or providing remuneration,directly or indirectly,in return for or to induceeither the referral of an individual for,or the purchase order or recommendation of,any item or services forwhich payment may be made under a federal healthcare program

298、 such as the Medicare and Medicaidprograms;U.S.federal false claims laws,which prohibit,among other things,individuals or entities from knowinglypresenting,or causing to be presented,claims for payment from Medicare,Medicaid,or other third-partypayors that are false or fraudulent.In addition,the U.S

299、.federal government may assert that a claimincluding items or services resulting from a violation of the federal Anti-Kickback Statute constitutes a falseor fraudulent claim for purposes of the false claims statutes;the U.S.Physician Payment Sunshine Act,which requires certain manufacturers of drugs

300、,biologics,devicesand medical supplies to record any transfers of value to U.S.physicians and U.S.teaching hospitals;the Health Insurance Portability and Accountability Act(HIPAA),as amended by the Health InformationTechnology for Economic and Clinical Health Act,which governs the conduct of certain

301、 electronichealthcare transactions and protects the security and privacy of protected health information;andstate or foreign law equivalents of each of the U.S.federal laws above,such as anti-kickback and falseclaims laws,which may apply to items or services reimbursed by any third-party payor,inclu

302、dingcommercial insurers.These laws will continue to impose administrative,cost and compliance burdens on us.The shifting complianceenvironment and the need to build and maintain robust systems to comply with multiple jurisdictions with differentcompliance and/or reporting requirements increases the

303、possibility that a healthcare company may violate one ormore of these requirements.In addition,any action against us for violation of these laws,even if we successfullydefend against it,could cause us to incur significant legal expenses and divert our managements attention from theoperation of our b

304、usiness.If our operations are found to be in violation of any of the laws described above or anyother governmental regulations that apply to us,we may be subject to penalties,including civil and criminalpenalties,damages,fines,exclusion from the Medicare and Medicaid programs or similar government p

305、rograms inforeign jurisdictions,and the curtailment or restructuring of our operations,any of which could adversely affect ourability to operate our business,results of operations and financial condition.Risks Related to Being a Public CompanyOur failure to establish and maintain effective internal

306、control over financial reporting could result in materialmisstatements in our financial statements,our failure to meet our reporting obligations and cause investors tolose confidence in our reported financial information,which in turn could cause the trading price of ourcommon stock to decline.Maint

307、aining effective disclosure controls and procedures and internal control over financial reporting are necessaryfor us to produce reliable financial statements.Material weaknesses in our internal control over financial reportinghave adversely affected us in the past and could affect us in the future

308、and the results of our periodic managementevaluations and annual auditor attestation reports regarding the effectiveness of our internal control over financialreporting required by Section 404 of the Sarbanes-Oxley Act of 2002.Any failure to maintain or implement new orimproved internal controls,or

309、any difficulties that we may encounter in their maintenance or implementation,couldresult in additional material weaknesses,result in material misstatements in our consolidated financial statements20and cause us to fail to meet our reporting obligations.This could cause us to lose public confidence

310、and could causethe trading price of our common stock to decline.General Business RisksNatural disasters,climate related events,terrorist attacks,acts of war,pandemics,disease outbreaks or otherevents beyond our control may cause damage or disruption to us and our employees,facilities,informationsyst

311、ems,security systems,vendors and customers,which could significantly impact our business,results ofoperations and financial condition.We have significant manufacturing and distribution facilities,including in the United States,France,Switzerland,Germany and Singapore.In particular,the western United

312、 States has experienced a number of earthquakes,wildfires,floods,landslides and other natural disasters in recent years.These occurrences could damage or destroyour facilities which may result in interruptions to our business and losses that exceed our insurance coverage.Inaddition,lack of fuel reso

313、urces due to geopolitical instability(such as Russias reduction in energy resourcessupplied to Western Europe),electricity outages,the inability to operate our production and distribution facilitiesdue to power grid failures or lack of fuel,and strikes or other labor unrest at any of our sites or su

314、rrounding areascould cause disruption to our business.Acts of terrorism,bioterrorism,violence or war(such as Russias invasion ofUkraine and the recent escalation of conflicts in the Middle East),weather-related events,or public health issuessuch as pandemics and the outbreak of a contagious disease

315、like COVID-19 could also affect the markets in whichwe operate,our business operations and strategic plans.Political unrest may affect our sales in certain regions,suchas in Southeast Asia,the Middle East and Eastern Europe.Any of these events could adversely affect our business,results of operation

316、s and financial condition.Risks Related to Our Common StockA significant majority of our voting stock is held by the Schwartz family,which could lead to conflicts of interest.We have two classes of voting stock:Class A Common Stock and Class B Common Stock.With a few exceptions,holders of Class A an

317、d Class B Common Stock vote as a single class.When voting as a single class,each share ofClass A Common Stock is entitled to one-tenth of a vote,while each share of Class B Common Stock has one vote.In the election or removal of directors,the classes vote separately and the holders of Class A Common

318、 Stock areentitled to elect 25%of the Board of Directors,with holders of Class B Common Stock electing the remainingdirectors.As a result of the Schwartz familys ownership of our Class A and Class B Common Stock,they are ableto elect a majority of our directors,effect fundamental changes in our dire

319、ction and control matters affecting us,including the determination of business opportunities that may be suitable for our company.The Schwartz familymay exercise its control over us according to interests that are different from other investors or debtors interests.Inparticular,this concentration of

320、 ownership and voting power may have the effect of delaying or preventing a changein control of our company.The forum selection provision in our bylaws could increase costs to bring a claim,discourage claims or limit theability of the Companys stockholders to bring a claim in a judicial forum viewed

321、 by the stockholders as morefavorable for disputes with the Company or the Companys directors,officers or other employees.Our bylaws provide that unless we consent in writing to the selection of an alternative forum,the Court of Chanceryof the State of Delaware(or,if the Court of Chancery does not h

322、ave jurisdiction,another state court located withinthe State of Delaware or,if no state court located within the State of Delaware has jurisdiction,the federal districtcourt for the District of Delaware)shall be the sole and exclusive forum for(i)any derivative action or proceedingbrought on behalf

323、of the Company,(ii)any action asserting a claim of breach of a fiduciary duty owed by anydirector,officer or other employee of the Company to the Company or the Companys stockholders,(iii)any actionarising pursuant to any provision of the General Corporation Law of the State of Delaware,the Certific

324、ate ofIncorporation or the Bylaws(in each case,as may be amended from time to time)or(iv)any action asserting aclaim against the Company or any of its directors,officers or other employees governed by the internal affairsdoctrine of the State of Delaware.This choice of forum provision may increase c

325、osts to bring a claim,discourageclaims or limit a stockholders ability to bring a claim in a judicial forum that it finds favorable for disputes with theCompany or the Companys directors,officers or other employees,which may discourage such lawsuits against theCompany or the Companys directors,offic

326、ers and other employees.Alternatively,if a court were to find the choice21of forum provision contained in the Companys bylaws to be inapplicable or unenforceable in an action,theCompany may incur additional costs associated with resolving such action in other jurisdictions.Application of the choice

327、of forum provision may be limited in some instances by applicable law.Section 27 of theExchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created bythe Exchange Act or the rules and regulations thereunder.As a result,the choice of forum provis

328、ion will not applyto actions arising under the Exchange Act or the rules and regulations thereunder.Section 22 of the Securities Actcreates concurrent jurisdiction for federal and state courts over suits brought to enforce any duty or liability createdby the Securities Act or the rules and regulatio

329、ns thereunder,subject to a limited exception for certain“coveredclass actions.”There is uncertainty,particularly in light of current litigation,as to whether a court would enforce thechoice of forum provision with respect to claims under the Securities Act.Our stockholders will not be deemed,byopera

330、tion of the Companys choice of forum provision,to have waived claims arising under the federal securitieslaws and the rules and regulations thereunder.ITEM 1B.UNRESOLVED STAFF COMMENTSNone.ITEM 1C.CYBERSECURITYCybersecurity Risk Management and StrategyWe have developed and implemented a cybersecurit

331、y risk management program intended to protect theconfidentiality,integrity,and availability of our critical systems and information.Our cybersecurity riskmanagement program includes a cybersecurity incident response plan.We design and assess our program based on the National Institute of Standards a

332、nd Technology CybersecurityFramework Special Publication 800-53,800-61,rev 2 and Center for Internet Security,Critical Security Controls(CIS Controls).This does not imply that we meet any particular technical standards,specifications,or requirements,only that we use the National Institute of Standar

333、ds and Technology Cybersecurity Framework as a guide to help usidentify,assess,and manage cybersecurity risks relevant to our business.Our cybersecurity risk management program is part of our overall enterprise risk management program,and sharescommon methodologies,reporting channels and governance processes that apply across the enterprise riskmanagement program to other legal,compliance,strategi