Bausch Health Cos — Financial Results

Revenue Grew 7% in 2025, Driven by Pricing and Volume Gains

Bausch Health returned to profitability in 2025, swinging from a $46 million loss to a $157 million profit. The revenue gain was spread across most business segments, with pricing improvements contributing $303 million and volume growth adding $220 million. The Salix segment — home to the flagship gut-health drug Xifaxan — was the standout, growing revenue 11% and profits 20%.

A $1.4 Billion Goodwill Write-Down Is Coming in Early 2026 After a Key Drug Trial Failed

The company's experimental drug rifaximin SSD, which was being tested to prevent serious liver complications in cirrhosis patients, failed to meet its goals in two Phase 3 clinical trials (the final stage of human testing before regulatory approval). Because of this failure, management expects to record a goodwill impairment (a write-down acknowledging that a business unit is worth less than previously carried on the books) of approximately $1,400 million against the Salix division in Q1 2026. This is a significant non-cash charge that will weigh heavily on reported results next year, even though it does not affect day-to-day cash flows.

Xifaxan Faces a Government-Set Price Cap in 2027 and Generic Competition in 2028

Xifaxan, which alone accounts for over 20% of total company revenue, was selected by the U.S. government for mandatory price negotiation under the Inflation Reduction Act (IRA). The negotiated price takes effect January 1, 2027, reducing revenue primarily in that year. Generic versions of Xifaxan are then expected to enter the market in 2028, which would cause a sharp further drop in sales. Management describes the combined impact as concentrated in 2027–2028 and not expected to derail long-term strategy, but this remains one of the most material near-term risks for investors to watch.

The Company Refinanced Over $11 Billion in Debt, Pushing Key Maturities Out to 2030–2032

Throughout 2025, Bausch Health executed multiple large refinancing transactions — most notably a $3 billion term loan and $4.4 billion in new secured notes issued in April — to push approximately $11 billion of debt that was coming due between 2025 and 2028 further out to 2030 and 2032. The trade-off is higher interest costs: interest expense jumped 16% to $1,604 million in 2025, and the average interest rate on debt rose from 7.72% to 8.54%. Total debt outstanding remains very large at $20.2 billion, and annual interest payments alone are expected to be approximately $1,720 million in 2026.

Solta Medical Was the Fastest-Growing Segment, Up 18%

The Solta Medical segment, which sells aesthetic devices like the Thermage skin-tightening system, grew 18% organically, driven largely by volume gains in Asia-Pacific. Bausch + Lomb (eye health) remains the largest segment at half of total revenue, growing a steady 6%. The International and Diversified segments were flat to slightly down.

Operating Cash Flow Fell Despite Higher Earnings, Reflecting the Cost of Heavy Debt

Operating cash flow (the cash the business actually generates before investing and financing) dropped to $1,400 million from $1,597 million, even as reported profits improved. The main culprits were higher interest payments ($1,534 million paid in cash during 2025 versus $1,379 million in 2024) and higher tax payments. This illustrates the ongoing tension between improving business operations and the substantial cash demands of the company's $20 billion debt load.