Notes to the Financial Statements Note 3: Restructuring and Impairment Expenses continued Velphoro VELPHORO®'s recent commercial performance has benefited from its inclusion in the Transitional Drug Add-on Payment Adjustment ("TDAPA") reimbursement program under the End Stage Renal Disease Prospective Payment System in the U.S, which has accelerated the realisation of economic benefits for the product. As the pattern of economic benefits generated by the TDAPA reimbursement program accelerated relative to diminishing balance amortisation profile applied for accounting purposes (refer to Note 8), a partial impairment of $175m was recognised in respect of CSL Vifor's Velphoro IP during the year ended 30 June 2026. The recoverable amount incorporates the scheduled expiry of the TDAPA reimbursement program in December 2026 and management's estimate of the resulting impact on future sales. The decline in revenue as a result of the expiry of reimbursement support is likely to result in additional impairment in future periods. The recoverable amount remains most sensitive to the impact of TDAPA expiry on future sales volumes and pricing realised through changes in revenue as outlined in the table below. Velphoro IP (Nephrology - Dialysis) Revenue US$m - 10% / + 10% Change in recoverable amount (31) / 31 Impairment (reversal)/charge 31 / (31) Tavneos During the year ended 30 June 2026, the Group recognised an impairment of Tavneos IP and associated assets following the European Medicines Agency (EMA) Committee for Medicinal Products for Human Use (CHMP) recommendation to revoke the EU marketing authorisation for Tavneos. The recommendation prior to 30 June 2026 represented conditions existing at the reporting date and resulted in a reassessment of the asset's recoverable amount. Subsequent to 30 June 2026, the European Commission formally revoked the marketing authorisation, consistent with the CHMP recommendation. In determining the recoverable amount, no value was attributed to future cash flows associated with Tavneos in Europe, reflecting uncertainty regarding the future availability and commercialisation of the product. Given the inherent uncertainty, potential future sales in markets outside Europe were assessed as having only a nominal recoverable amount. Accordingly, the Group recognised a total charge of $166m, comprising a full impairment of the IP and associated costs. sa-mRNA vaccine technology During the year ended 30 June 2026, the Group recognised a full impairment of the sa-mRNA vaccine technology IP of $483m, together with impairment charges related to PPE and right-of-use assets of $50m and other expenses of $57m. The impairment was driven by declining COVID disease burden, more onerous regulatory requirements in the U.S and the Group's decision to discontinue the sa-mRNA collaboration following a review of the third party partnership, which together significantly reduced the expected future economic benefits associated with the technology. CSL Behring Lengnau During the year ended 30 June 2026, the Group reassessed the expected future economic benefits associated with its multipurpose manufacturing site located in Lengnau, Switzerland, which was designed to support manufacturing of CSL products, including IDELVION®, and third-party manufacturing activities. This reassessment followed further clarification of the site's future operating model and expected sources of revenue. Assets supporting third-party product manufacturing are no longer expected to generate the level of future economic benefits previously anticipated. As a result, the recoverable amount of the affected assets was determined to be below their carrying value, resulting in an impairment charge of $931m against property, plant and equipment. The remaining carrying value of the site includes $122m supported by contractual lease arrangements (Note 9). Should actual lease income differ materially from current contractual commitments, additional impairment charges or reversals may arise in future periods. 102 102 Financial Report
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