Finance Report 2023

Finance Report 2023
Finance in Brief
Key results
Sales Core operating profit margin

CER growth % % of sales
Pharmaceuticals 2023 +5.9 44.8

2022 +2.1 46.4
Diagnostics 2023 -13.1 18.9

2022 +2.5 24.7
Group 2023 +0.6 32.8

2022 +2.2 35.0
2023 2022 % change % change % of sales % of sales

(CHF m) (CHF m) (CHF) (CER) 2023 2022
IFRS results
Sales 58,716 63,281 –7 +1
Operating profit 15,395 17,476 –12 +3 26.2 27.6
Net income 12,358 13,531 –9 +7 21.0 21.4
Net income attributable to Roche shareholders 11,498 12,421 –7 +9 19.6 19.6
Diluted EPS (CHF) 14.31 15.37 –7 +11
Dividend per share (CHF) 9.60 a) 9.50 +1
Core results
Research and development 13,237 13,255 0 +5 22.5 20.9
Core operating profit 19,240 22,173 –13 –1 32.8 35.0
Core EPS (CHF) 18.57 20.30 –9 +6
Free cash flow

Operating free cash flow 15,768 17,673 –11 +4 26.9 27.9
Free cash flow 11,288 13,041 –13 +4 19.2 20.6
2023 2022 % change % change

(CHF m) (CHF m) (CHF) (CER)
Net debt (18,699) (15,584) +20 +26
Capitalisation 62,472 57,366 +9 +19

– Debt 29,209 25,351 +15 +24
– Equity 33,263 32,015 +4 +15
a) Proposed by the Board of Directors.
CER (Constant Exchange Rates): The percentage changes at constant exchange rates are calculated using simulations by reconsolidating both the 2023 and 2022 results
at constant exchange rates (the average rates for the year ended 31 December 2022). For the definition of CER see page 180.
Core results and Core EPS (earnings per share): These exclude non-core items such as global restructuring plans and amortisation and impairment of goodwill and intangible
assets. This allows an assessment of both the actual results and the underlying performance of the business. A full income statement for the Group and the operating results
of the divisions are shown on both an IFRS and core basis. The core concept is fully described on pages 172–176 and reconciliations between the IFRS and core results are
given there.
Free cash flow is used to assess the Group’s ability to generate the cash required to conduct and maintain its operations. It also indicates the Group’s ability to generate
cash to finance dividend payments, to repay debt and to undertake merger and acquisition activities. The free cash flow concept is used in the internal management of the
business. The free cash flow concept is fully described on pages 176–178 and reconciliations between the IFRS cash flow and free cash flow are given there.
Effective 1 January 2023, the Group has made certain presentational and cost allocation changes to the income statement. The comparative information for 2022 has been
restated accordingly. Details are given on page 45.
Finance Report 2023 Roche Group    1
Finance – 2023 in Brief
Roche in 2023
The Roche Group sales grew by 1% at constant exchange rates (CER). IFRS net income increased by 7% (CER) and core earnings
per share increased by 6% (CER). The appreciation of the Swiss franc had a significant adverse impact on the results expressed in
Swiss francs.
Sales
Group sales were CHF 58.7 billion, an increase of 1% at CER (7% decrease in CHF terms). Pharmaceuticals sales increased by 6%
(CER) driven by the growing demand for newer medicines, which more than offset the negative impact from biosimilar competition.
Diagnostics sales declined by 13% (CER) following the sharp decline in demand for COVID-19-related tests, while sales in the base
business increased by 7%.
Operating results
Core operating profit decreased by 1% (CER) to CHF 19.2 billion (13% decrease in CHF terms) due to lower COVID-19-related sales,
continued investment into research and development, where expenditure grew by 5% (CER) to CHF 13.2 billion on a core basis,
and the base effect of the Ultomiris patent settlement in 2022. The Telavant asset acquisition was completed for CHF 6.2 billion.
IFRS operating results were 3% higher (CER) and included non-core expenses, notably for restructuring costs and goodwill and
intangible asset impairment, which were lower in total than in 2022.
Non-operating results
Financing costs (IFRS) increased by 59% at CER to CHF 1.0 billion due to the issuance of new debt as well as an increase in
interest rates. Income tax expenses (IFRS) decreased by 27% at CER to CHF 1.7 billion due to the resolution of several tax disputes.
The effective core tax rate for 2023 decreased to 11.9%.
Net income
IFRS net income was CHF 12.4 billion, an increase of 7% at CER (decrease of 9% in CHF terms). Core earnings per share increased
by 6% at CER to CHF 18.57 (decrease of 9% in CHF terms). The Core EPS growth included a positive impact of approximately
5 percentage points from the resolution of tax disputes in 2023.
Cash flows
Operating free cash flow was CHF 15.8 billion, an increase of 4% at CER (decrease of 11% in CHF terms) and Free cash flow
increased by 4% at CER (decrease of 13% in CHF terms) to CHF 11.3 billion, with both reflecting the underlying cash generation of the
business.
Financial position
Net working capital increased by 6% at CER (decrease of 8% in CHF terms) driven by higher trade receivables in both divisions.
Net debt increased by CHF 3.1 billion to CHF 18.7 billion due primarily to the payments for the Telavant asset acquisition. Credit ratings
remained high: AA by Standard & Poor’s, Aa2 by Moody’s and AA by Fitch.
Shareholder return
A proposal will be made to increase dividends by 1% to CHF 9.60 per share and non-voting equity security. This would represent
the 37th consecutive year of dividend growth and would result in a pay-out ratio of 51.7%, subject to AGM approval. Total Shareholder
Return (TSR) was minus 14.4% representing the combined performance of share and non-voting equity security.
2    Roche Group Finance Report 2023
Roche Group
Finance in Brief Inside cover
Finance – 2023 in Brief 1

Financial Review 3
Roche Group Consolidated Financial Statements 46
Notes to the Roche Group Consolidated Financial Statements 52
1. General accounting principles 52 19. Other current liabilities 86
2. Operating segment information 55 20. Provisions and contingent liabilities 87
3. Revenue 59 21. Debt 94
4. Net financial expense 62 22. Equity attributable to Roche shareholders 100
5. Income taxes 64 23. Subsidiaries and associates 104
6. Mergers and acquisitions 67 24. Non-controlling interests 106
7. Global restructuring plans 70 25. Employee benefits 106
8. Property, plant and equipment 73 26. Pensions and other post-employment
9. Goodwill 75 benefits107
10. Intangible assets 78 27. Equity compensation plans 114
11. Inventories 83 28. Leases 118
12. Accounts receivable 83 29. Earnings per share and non-voting
13. Marketable securities 84 equity security 123
14. Cash and cash equivalents 84 30. Statement of cash flows 124
15. Other non-current assets 85 31. Risk management 126
16. Other current assets 85 32. Related parties 140
17. Accounts payable 86 33. List of subsidiaries and associates 143
18. Other non-current liabilities 86 34. Accounting policies 148
Report of Roche Management on Internal Control over Financial Reporting 162

Statutory Auditor’s Report to the General Meeting of Roche Holding Ltd, Basel 163
Multi-Year Overview and Supplementary Information 168
Roche Securities 181
Roche Holding Ltd, Basel

Financial Statements 185
Notes to the Financial Statements 187
Appropriation of Available Earnings 194
Finance Report 2023 Financial Review | Roche Group    3
Financial Review
Roche Group results
Sales in billions of CHF Core operating profit in billions of CHF
% CER growth % of sales

0 10 20 30 40 50 60 0 5 10 15 20
2023 +0.6 32.8
2022 +2.2 35.0
2021 +9.3 34.9
Net income attributable to Roche shareholders in billions of CHF Core EPS in CHF
0 2 4 6 8 10 12 14 0 5 10 15 20
2023 11.5 18.57
2022 12.4 20.30
2021 13.9 19.81
In 2023 the Roche Group reported sales growth of 1% and a core operating profit decline of 1% at CER. IFRS net income
increased by 7% while Core EPS increased by 6% at CER. The appreciation of the Swiss franc against many currencies had an
adverse net impact on the results expressed in Swiss francs of 8 percentage points on sales, 12 percentage points on core
operating profit, 15 percentage points on Core EPS and 16 percentage points on IFRS net income.
Sales in the Pharmaceuticals Division were CHF 44.6 billion (2022: CHF 45.6 billion), an increase of 6% at CER, driven by growing
demand for Vabysmo, Ocrevus, Hemlibra, Polivy and Phesgo, which together contributed an additional CHF 4.3 billion (CER)
of sales. Sales of MabThera/Rituxan, Herceptin and Avastin decreased by a combined CHF 1.1 billion (CER), as the impact of
biosimilar competition continued, but to a lower extent. Sales of the COVID-19 medicine Ronapreve fell by CHF 1.1 billion (CER)
due to the evolving COVID-19 situation.
The Diagnostics Division reported sales of CHF 14.1 billion, a decline of 13% at CER due to lower sales of COVID-19-related
tests. The division’s base business grew by 7% at CER and across all regions, with immunodiagnostics, particularly cardiac tests,
being the main growth driver. The Diagnostics Division’s portfolio of COVID-19 tests generated sales of CHF 0.8 billion in 2023
compared to CHF 4.1 billion in 2022, a decline of 80% at CER.
4    Roche Group | Financial Review Finance Report 2023
Divisional operating results for 2023

Pharmaceuticals Diagnostics Corporate Group
(CHF m) (CHF m) (CHF m) (CHF m)
Sales 44,612 14,104 – 58,716
Core operating profit 19,989 2,668 (3,417) 19,240
– Margin, % of sales 44.8 18.9 – 32.8
Operating profit 17,132 2,171 (3,908) 15,395
– Margin, % of sales 38.4 15.4 – 26.2
Operating free cash flow 17,728 1,677 (3,637) 15,768
– Margin, % of sales 39.7 11.9 – 26.9
Divisional operating results – Development of results compared to 2022

Sales
– % change at CER +6 –13 – +1
Core operating profit
– % change at CER +5 –24 +5 –1
– Margin: percentage point change –0.4 –3.2 – –0.5
Operating profit
– % change at CER +14 –32 +16 +3
– Margin: percentage point change +3.0 –5.2 – +0.6
Operating free cash flow
– % change at CER +12 –35 +10 +4
– Margin: percentage point change +2.3 –4.8 – +0.9
The core operating profit decline of 1% at CER reflected the continued investments in research and development and the base
effect of the Ultomiris patent settlement in 2022 in the Pharmaceuticals Division and the decrease in COVID-19-related sales in
the Diagnostics Division.
The Pharmaceuticals Division’s core operating profit increased by 5% at CER, which was below the sales increase of 6%, due to
the CHF 0.7 billion of income from the Ultomiris patent settlement in 2022. Cost of sales decreased by 1%, despite the increase
in sales. Underlying manufacturing costs were broadly in line with the increase in sales volumes, while being impacted by factors
related to COVID-19 products. Higher royalty expenses were offset by lower collaboration and profit-share costs. Research and
development costs were CHF 11.5 billion, an increase of 6%. Oncology remained the primary area of research and development
and the main driver of the growth. Neuroscience, ophthalmology and immunology also represented significant areas of spending.
In research and early-stage development, the increase in costs was mostly driven by investments in computational biology. In
addition, depreciation expenses for new research facilities contributed to the growth in costs. Selling, general and administration
costs increased by 6% due to marketing and distribution costs for ongoing launches, especially of Vabysmo. Other operating
income (expense) was CHF 0.8 billion and included CHF 0.6 billion gains from the disposal of products.
In the Diagnostics Division, core operating profit decreased by 24% at CER to CHF 2.7 billion, driven by the sharp decline of
COVID-19-related sales. Cost of sales decreased by 15%, exceeding the 13% decrease in sales, because of a mix effect from
the lower sales volumes of SARS-CoV-2 Rapid Antigen tests. Research and development costs decreased by 1% following
targeted productivity measures. Investments in digital solutions and sequencing remained significant areas of investment.
Selling, general and administration costs remained stable with lower distribution costs related to SARS-CoV-2 Rapid Antigen
tests being partly offset by higher inventory write-offs.
In the overall Group results the decrease in cost of sales as a percentage of sales was driven by the improved gross margins
within both divisions and also by a divisional mix effect from the increased sales of the Pharmaceuticals Division and the lower
COVID-19-related sales in the Diagnostics Division, coupled with the different gross margins of the two divisions. The Group
core operating profit was 1% lower at CER (13% lower in CHF).
The increase in IFRS operating profit of 14% (CER) in the Pharmaceuticals Division was above the 5% growth in core operating
profit, due to lower charges for impairment of goodwill and intangible assets. In the Diagnostics Division, IFRS operating profit
decreased by 32% (CER), driven by the 24% decline in core operating profit and higher expenses from global restructuring
plans resulting from various productivity initiatives launched in 2023. The 2023 results for the Group include CHF 2.0 billion for
restructuring costs, CHF 1.2 billion for goodwill and intangible asset impairment charges and CHF 0.7 billion for intangible asset
amortisation charges. Group IFRS operating profit was 3% higher at CER (12% lower in CHF).
Financing costs increased by 59% (IFRS basis at CER) to CHF 1.0 billion mainly due to additional interest expenses from
new debt as well as increases in interest rates which affected short-term borrowing costs. Other financial income (expense)
was a net expense of CHF 0.3 billion, with the major item being net foreign exchange losses and losses on net monetary
position in hyperinflationary economies following the devaluation in Argentina in December 2023. The Group’s effective core
tax rate decreased to 11.9% compared to 16.4% in 2022. The decrease was mainly due to the impact from the resolution
of several tax disputes which reduced the Group’s effective core tax rate by 4.3 percentage points in 2023 compared to
1.5 percentage points in 2022. The lower percentage of core profit contribution coming from tax jurisdictions with tax rates
higher than the Group’s average tax rate further reduced the Group’s effective core tax rate.
Net income increased by 7% at CER (decrease of 9% in CHF) on an IFRS basis to CHF 12.4 billion while Core EPS increased by 6%
at CER (decrease of 9% in CHF) to CHF 18.57. The base effect of the Ultomiris patent settlement income in 2022 had a dilutive
impact, net of tax, of approximately 2 percentage points on Core EPS growth. The growth of Core EPS also included a positive
impact of approximately 5 percentage points from the resolution of tax disputes in 2023. The amount of net income attributable
to non-controlling interests decreased by 15% on both an IFRS and core basis, due to the base effect of the Ultomiris patent
settlement income at Chugai in 2022.
Operating free cash flow was CHF 15.8 billion, an increase of 4% at CER (decrease of 11% in CHF). The free cash flow was
CHF 11.3 billion, an increase of 4% at CER (decrease of 13% in CHF). These both reflected the underlying cash generation of
the business. Other factors in the operating free cash flow included the increase in net working capital being lower than in
2022, partly offset by higher capital expenditure. The free cash flow also included increased interest payments and lower tax
payments.
Income statement
IFRS results
Sales 58,716 63,281 –7 +1
Other revenue 1,725 2,533 –32 –27
Revenue 60,441 65,814 –8 0
Cost of sales (16,357) (19,737) –17 –13
Research and development (14,200) (15,225) –7 –2
Selling, general and administration (14,881) (14,201) +5 +11
Other operating income (expense) 392 825 –52 –51
Operating profit 15,395 17,476 –12 +3
Financing costs (996) (665) +50 +59

Other financial income (expense) (320) (484) –34 –24
Profit before taxes 14,079 16,327 –14 +1
Income taxes (1,721) (2,796) –38 –27

Net income 12,358 13,531 –9 +7
Attributable to
– Roche shareholders 11,498 12,421 –7 +9
– Non-controlling interests 860 1,110 –23 –15
EPS – Basic (CHF) 14.40 15.52 –7 +11

EPS – Diluted (CHF) 14.31 15.37 –7 +11
Core results a)
Sales 58,716 63,281 –7 +1
Other revenue 1,725 2,533 –32 –27
Revenue 60,441 65,814 –8 0
Cost of sales (15,251) (17,415) –12 –8
Research and development (13,237) (13,255) 0 +5
Selling, general and administration (13,518) (13,767) –2 +4
Other operating income (expense) 805 796 +1 +6
Operating profit 19,240 22,173 –13 –1

Profit before taxes 17,940 20,959 –14 –2
Income taxes (2,136) (3,429) –38 –28

Net income 15,804 17,530 –10 +3
Attributable to
Core EPS – Basic (CHF) 18.69 20.49 –9 +6

Core EPS – Diluted (CHF) 18.57 20.30 –9 +6
a) See pages 172–176 for the definition of core results and Core EPS.
Competition from biosimilar and generic medicines
The Group’s pharmaceutical products are generally protected by patent rights, which are intended to provide the Group with
exclusive marketing rights in various countries. However, patent rights are of varying scope and duration, and the Group may be
required to enter into costly litigation to enforce its patent and other intellectual property rights. Loss of market exclusivity for one
or more major products – either due to patent expiration, challenges from generic medicines, biosimilars and non-comparable
biologics or other reasons – could have a material adverse effect on the Group’s business, results of operations or financial
condition. The introduction of a generic, biosimilar or non-comparable biologic version of the same or a similar medicine usually
results in a significant reduction in net sales for the relevant product, as other manufacturers typically offer their versions at
lower prices.
Patents and their expiry are, and always have been, an integral part of the Group’s business model and future growth will remain
driven by innovation. The latest information from clinical studies is included in the Annual Report and details of the Group’s product
development portfolio are available for download at https://www.roche.com/solutions/pipeline
MabThera/Rituxan, Herceptin and Avastin. The Group’s basic, primary patents for these three products have expired worldwide.
Sales, including regional breakdowns, for MabThera/Rituxan, Herceptin and Avastin are disclosed in the Pharmaceuticals
Division’s operating results and are summarised in the table below. The year-on-year movements were also driven by regular
price and volume changes. Biosimilar competition is only one factor in the overall picture.
Total MabThera/Rituxan, Herceptin and Avastin sales

2023 2022 % change % divisional sales % divisional sales
(CHF m) (CHF m) (CER) (2023) (2022)
United States 1,802 2,426 –21 4.0 5.3
Europe 631 819 –20 1.4 1.8
Japan 372 573 –26 0.8 1.3
International 2,024 2,521 –10 4.6 5.5
Total sales 4,829 6,339 –17 10.8 13.9
The first biosimilar versions of Herceptin and Avastin were launched in the US from mid-2019 and the first biosimilar versions
of MabThera/Rituxan in late 2019. In Europe the first biosimilar versions of MabThera/Rituxan and Herceptin were launched from
mid-2017 and from mid-2018, respectively, and are now marketed in most EU countries. The first biosimilar versions of Avastin
came to market in Europe from mid-2020. The first biosimilar versions of MabThera/Rituxan and Herceptin were launched in
Japan in 2018. Biosimilar versions of Avastin were launched in Japan in late 2019 in the colorectal cancer indication, in 2020 in
the non-small cell lung cancer indication, in 2022 in the breast cancer indication and in 2023 in the ovarian cancer indication.
Sales of these three products in Japan were impacted by government price cuts as well as biosimilar competition. In the
International region, biosimilar versions of all three products have been launched in many countries and this, together with the
impacts of regular price and volume changes, has led to the decline in sales.
Lucentis. The Group’s basic, primary patents have expired in the US. The first biosimilar version of Lucentis with a restricted
label came to market in the US in the third quarter of 2022. US sales of Lucentis were CHF 460 million (2022: CHF 1,012 million),
a decline of 52% at CER due to competitive pressure.
Esbriet. The first generic versions of Esbriet came to market in the second quarter of 2022. The sales of Esbriet were
CHF 202 million (2022: CHF 718 million), a decline of 70% at CER.
Actemra/RoActemra. The Group’s basic, primary patents have expired in the US and the EU. The first biosimilar versions of
Actemra/RoActemra came to market in the EU in the fourth quarter of 2023. Based on publicly available information, the Group
currently anticipates that the first biosimilar versions could come to market in the US in the first half of 2024. Global sales of
Actemra/RoActemra were CHF 2,630 million (2022: CHF 2,701 million), an increase of 5% at CER, driven by the performance in
the immunology therapeutic area despite lower demand from hospitalised patients with COVID-19.
Mergers and acquisitions
Asset acquisition. On 14 December 2023 the Group acquired a 100% controlling interest in Telavant Holdings, Inc. (‘Telavant’),
a US company owned by Roivant Sciences Ltd. (‘Roivant’) and Pfizer Inc. (‘Pfizer’). With this transaction, the Group obtained
rights to Telavant’s portfolio, including full rights to further develop and manufacture RVT-3101 and commercialise it in the US
and in Japan. RVT-3101 is a phase III-ready novel TL1A-directed antibody for the treatment of inflammatory bowel disease and
potentially multiple other diseases. The cash consideration paid at the acquisition date was USD 7.1 billion.
Divestment. In May 2023 the Group announced plans to exit its legacy Genentech manufacturing facility in Vacaville,
California, as part of a broader strategy to evolve its manufacturing capabilities in line with future pipeline requirements. As of
31 December 2023 the assets and certain liabilities directly associated with the Vacaville manufacturing plant were classified
as held for sale, as the Group is committed to a plan to sell, which is expected to be completed in 2024.
Future business combinations. On 26 January 2024 the Group completed the acquisition of Carmot Therapeutics, Inc. (‘Carmot’).
With the acquisition, the Group obtained access to three clinical-stage product candidates to treat obesity and diabetes, as well
as a number of preclinical programmes. The purchase consideration was USD 2.9 billion in cash and up to USD 0.4 billion from
a contingent consideration arrangement. On 29 December 2023 the Group announced the entry into a definitive agreement to
acquire selected subsidiaries of LumiraDx Limited (‘LumiraDx’). With the acquisition, the Group will obtain access to LumiraDx’s
point-of-care technology which combines multiple diagnostic modalities on a single platform. The transaction is subject to certain
conditions including antitrust and regulatory approvals. The closing of the transaction is currently expected to take place by
mid-2024.
Further details are given in Note 6 to the Annual Financial Statements.
Alliance transactions
In 2023 in-licensing and alliance transactions resulted in intangible assets of CHF 1.0 billion being recognised.
Global restructuring plans
During 2023 the Group launched different productivity initiatives to reinvest in strategic areas and continued the
implementation of various global restructuring plans initiated in prior years.
Global restructuring plans: costs incurred in millions of CHF
2023 2022
Global restructuring costs
– Employee-related costs 577 127
– Site closure and other costs related to physical assets 925 323
– Divestment of products and businesses 0 0
– Other reorganisation expenses 536 519
Total global restructuring costs 2,038 969
The Pharmaceuticals Division incurred restructuring costs of CHF 1,112 million, with the major item being an infrastructure
strategy optimisation programme resulting in costs of CHF 554 million, primarily consisting of impairment of right-of-use
assets and property, plant and equipment at US sites. Chugai initiated an early retirement incentive programme and incurred
employee-related costs of CHF 66 million. The Diagnostics Division incurred costs of CHF 437 million for manufacturing and
supply chain optimisations, research and development productivity initiatives and business transformations to drive organisational
and commercial effectiveness. Corporate costs were CHF 489 million and included the business process transformation to
simplify the systems landscape and reduce process complexity. This transformation is a multi-year cross-divisional programme
to drive efficiency gains through system and process optimisation. Further details are given in Note 7 to the Annual Financial
Statements.
Impairment of goodwill and intangible assets
Pharmaceuticals Division. The Pharmaceuticals Division recorded impairment charges to intangible assets of CHF 0.6 billion
in total which were driven by reduced sales expectations and the latest research data. These charges included CHF 0.3 billion
related to the impairment of several product intangible assets in development following clinical data assessments. There were
also impairment charges of CHF 0.2 billion for the partial impairment of the product intangible asset for Rozlytrek, acquired
as part of the Ignyta acquisition, and CHF 0.1 billion for the partial impairment of the product intangible asset for SPK-9001, a
novel gene therapy for the treatment of haemophilia B that was acquired as part of the Spark Therapeutics acquisition.
The Pharmaceuticals Division recorded impairment charges to goodwill of CHF 0.6 billion for the full write-off of goodwill from
the Foundation Medicine acquisition.
Diagnostics Division. There were no significant impairments of goodwill or intangible assets.
In 2022 there were impairment charges of CHF 2.8 billion in the Pharmaceuticals Division and none in the Diagnostics Division.
Further details are given in Notes 9 and 10 to the Annual Financial Statements.
Legal and environmental cases
Some of the provisions previously held were released based on the development of the various litigations. There was also a
reimbursement of a fine imposed in 2020 by the French Competition Authority on the Avastin/Lucentis investigation following a
court decision. These legal matters resulted in an income of CHF 230 million. The environmental cases included an increase in
provisions of CHF 61 million for environmental matters mainly at the Clarecastle site in Ireland. There were no other significant
developments in 2023. Further details are given in Note 20 to the Annual Financial Statements.
Net income and earnings per share
IFRS net income increased by 7% at CER while Core EPS increased by 6%. The base effect of the Ultomiris patent settlement
income in 2022 had a dilutive impact, net of tax, of approximately 2 percentage points on the Core EPS growth. The Core EPS
growth also included a positive impact of approximately 5 percentage points from the resolution of tax disputes in 2023. The
core basis excludes non-core items such as global restructuring costs, amortisation and impairment of goodwill and intangible
assets, legal and environmental cases, and mergers and acquisitions and alliance transactions. The amount of net income
attributable to non-controlling interests decreased by 15% on both an IFRS and core basis, due to the base effect of the Ultomiris
patent settlement income in 2022 at Chugai.
Net income
IFRS net income 12,358 13,531 –9 +7
Reconciling items (net of tax)

– Global restructuring plans 1,635 776 +111 +119
– Intangible asset amortisation 667 853 –22 –18
– Goodwill and intangible asset impairment 1,128 2,402 –53 –50
– Mergers and acquisitions and alliance transactions 21 (66) – –
– Legal and environmental cases (73) (34) +115 +127
– Normalisation of equity compensation plan tax benefit 68 68 0 +6
Core net income 15,804 17,530 –10 +3
Supplementary net income and EPS information is given on pages 172 to 176. This includes calculations of Core EPS and
reconciles the core results to the Group’s published IFRS results.
Financial position
Financial position
Pharmaceuticals
Net working capital 3,446 3,791 –9 +6
Other net operating assets 33,060 28,765 +15 +24
Diagnostics
Other net operating assets 12,690 13,250 –4 +3
Corporate
Net working capital (487) (337) +45 +48
Other net operating assets 158 182 –13 –6
Net operating assets 52,115 48,919 +7 +16
Net debt (18,699) (15,584) +20 +26

Lease liabilities (1,573) (1,193) +32 +44
Pensions (3,360) (3,604) –7 0
Income taxes 4,376 2,908 +50 +68
Other net non-operating assets 404 569 –29 –31
Total net assets 33,263 32,015 +4 +15
Compared to the start of the year the Swiss franc appreciated against most currencies, with the US dollar and the Japanese
yen having a significant negative translation effect on the Group’s net operating assets. The negative translation effect from
the US dollar was partially compensated by the natural hedge from the Group’s US dollar-denominated debt. The exchange
rates used are given on page 32.
Net working capital in the Pharmaceuticals Division increased by 6%. Trade receivables increased because of higher sales of
Vabysmo and Ocrevus that had extended payment terms in the US. Trade payables decreased due to the payments for the
construction of the Yokohama research and development site in Japan. In the Diagnostics Division, trade receivables increased
by 14% following higher sales in the last quarter of 2023 compared to the same period of 2022 and also due to the base effect
from higher collections towards the end of 2022. In addition, inventories decreased by 8% following lower inventory levels of
COVID-19-related products.
The increase in net debt was primarily driven by the payment for the asset acquisition of Telavant of CHF 6.2 billion. The net tax
assets increased in total due to the decrease in current income tax liabilities following the resolution of tax disputes in 2023.
Lease liabilities increased to CHF 1.6 billion mainly due to the new laboratory and office space lease for Foundation Medicine.
The net pension liability remained stable at CER.
Free cash flow
Free cash flow

Pharmaceuticals 17,728 17,694 0 +12
Diagnostics 1,677 3,382 –50 –35
Corporate (3,637) (3,403) +7 +10
Operating free cash flow 15,768 17,673 –11 +4
Treasury activities (860) (530) +62 +72
Taxes paid (3,620) (4,102) –12 –5
Free cash flow 11,288 13,041 –13 +4
See pages 176–178 for the definition of free cash flow and a detailed breakdown.
Effective 1 January 2023, the Group has made certain presentational and cost allocation changes to the income statement. These changes have a consequential impact on
the divisional free cash flow, although total Group free cash flow is unaffected. The comparative information for 2022 has been restated accordingly. Details are given on
page 45.
Operating free cash flow was CHF 15.8 billion, an increase of 4% at CER (decrease of 11% in CHF), and free cash flow was
CHF 11.3 billion, an increase of 4% at CER (decrease of 13% in CHF). Cash generation remained at a high level in both divisions,
although lower in the Diagnostics Division due to the reduced COVID-19-related business. Net working capital increased in both
divisions, but at a lower rate than in the prior year, and capital expenditure was also higher. Interest payments were higher due
to the increase in debt and higher interest rates, while income tax payments were lower. The appreciation of the Swiss franc
had a significant adverse impact on the cash flows expressed in Swiss francs.
Pharmaceuticals Division operating results
Pharmaceuticals Division operating results

IFRS results
Sales 44,612 45,551 –2 +6
Other revenue 1,667 2,465 –32 –27
Revenue 46,279 48,016 –4 +4
Cost of sales (9,083) (11,040) –18 –13
Selling, general and administration (7,945) (7,598) +5 +12
Other operating income (expense) 233 772 –70 –69
Operating profit 17,132 16,766 +2 +14
– Margin, % of sales 38.4 36.8 +1.6 +3.0
Core results a)
Sales 44,612 45,551 –2 +6
Other revenue 1,667 2,465 –32 –27
Revenue 46,279 48,016 –4 +4
Cost of sales (8,343) (8,905) –6 –1
Research and development (11,490) (11,420) +1 +6
Other operating income (expense) 758 764 –1 +3
Core operating profit 19,989 21,131 –5 +5
– Margin, % of sales 44.8 46.4 –1.6 –0.4
Financial position
Other net operating assets 33,060 28,765 +15 +24
Net operating assets 36,506 32,556 +12 +22
Free cash flow b)

Operating free cash flow 17,728 17,694 0 +12
– Margin, % of sales 39.7 38.8 +0.9 +2.3
a) See pages 172–176 for the definition of core results.

b) See pages 176–178 for the definition of free cash flow.
Sales overview
Pharmaceuticals Division – Sales by therapeutic area

2023 2022 % change % of sales % of sales
(CHF m) (CHF m) (CER) (2023) (2022)
Oncology 19,087 19,995 +4 42.8 43.9
Neuroscience 8,445 7,817 +16 18.9 17.2
Immunology 6,242 7,181 –7 14.0 15.8
Haemophilia A 4,147 3,823 +16 9.3 8.4
Ophthalmology a) 2,865 1,651 +85 6.4 3.6
Infectious diseases 1,056 2,161 –45 2.4 4.7
Other therapeutic areas a) 2,770 2,923 +3 6.2 6.4
Total sales 44,612 45,551 +6 100 100
a) In 2023 sales of the ‘Ophthalmology’ therapeutic area included sales of Luxturna. These were previously shown as part of ‘Other therapeutic areas’. The comparative
information for 2022 has been restated accordingly. Sales of Luxturna for 2022 were CHF 46 million.
Sales in the Pharmaceuticals Division were CHF 44.6 billion (2022: CHF 45.6 billion), an increase of 6% at CER, driven by growing
demand for Vabysmo, Ocrevus, Hemlibra, Polivy and Phesgo, which together contributed an additional CHF 4.3 billion (CER) of
sales. Sales of MabThera/Rituxan, Herceptin and Avastin decreased by a combined CHF 1.1 billion (CER) or 17%, as the impact
of biosimilar competition continued, but to a lower extent.
Sales of Ocrevus were CHF 6.4 billion, an increase of 13%, which included 11% growth in the US. Hemlibra reported sales of
CHF 4.1 billion, an increase of 16%, led by US sales in the non-inhibitor segment. Sales of Perjeta were CHF 3.8 billion with
growth in the International region being partly offset by a decline in sales in the US as a result of an adjustment in the reserves
related to US governmental plans. Tecentriq sales were CHF 3.8 billion, with growth of 9% across all regions. Vabysmo was a
major growth driver with sales of CHF 2.4 billion mainly in the US.
Sales in the oncology therapeutic area increased by 4%, with the growth being driven by Polivy, Phesgo and Tecentriq, partially
offset by the biosimilar competition for MabThera/Rituxan, Herceptin and Avastin. Phesgo sales were CHF 1.1 billion with a
growth of 64% in all regions. Polivy sales increased by 108% to CHF 0.8 billion across all regions, notably in the US and Japan.
Sales in neuroscience grew by 16% mainly due to Ocrevus and Evrysdi, with Enspryng also contributing to the sales growth.
In the immunology therapeutic area, Actemra/RoActemra sales increased by 5% despite the lower demand from hospitalised
patients with COVID-19. Xolair sales in the US were 5% higher, while sales of Esbriet were 70% lower as a result of generic
competition, which was the main contributor to the overall 7% sales decline in immunology.
Sales in the haemophilia A therapeutic area grew by 16% due to the continued growth of Hemlibra in the non-inhibitor segment.
Sales in ophthalmology significantly increased reflecting the growth in Vabysmo sales, partially offset by the 52% decrease in
Lucentis sales in the US due to competitive pressure. For infectious diseases, Ronapreve sales decreased by 65% reflecting the
lower sales due to the evolving COVID-19 situation. In other therapeutic areas, sales of Activase/TNKase were 6% higher mainly
driven by increasing demand in the acute ischaemic stroke indication.
Product sales
Pharmaceuticals Division – Sales

(CHF m) (CHF m) (CER) (2023) (2022)
Oncology
Perjeta 3,768 4,087 +1 8.4 9.0
Tecentriq 3,766 3,717 +9 8.4 8.2
Kadcyla 1,966 2,080 +4 4.4 4.6
Herceptin 1,626 2,142 –16 3.6 4.7
Avastin 1,573 2,122 –19 3.5 4.7
Alecensa 1,502 1,513 +8 3.4 3.3
MabThera/Rituxan a) 1,261 1,599 –15 2.8 3.5
Phesgo 1,120 740 +64 2.5 1.6
Polivy 837 437 +108 1.9 1.0
Gazyva/Gazyvaro 811 730 +19 1.8 1.6
Erivedge 245 271 0 0.5 0.6
Others 612 557 +21 1.6 1.1
Total Oncology 19,087 19,995 +4 42.8 43.9
Neuroscience
Ocrevus 6,381 6,036 +13 14.3 13.3
Evrysdi 1,419 1,119 +39 3.2 2.5
Madopar 355 379 0 0.8 0.8
Enspryng 256 192 +49 0.6 0.4
Others 34 91 –64 0.0 0.2
Total Neuroscience 8,445 7,817 +16 18.9 17.2
Immunology
Actemra/RoActemra 2,630 2,701 +5 5.9 5.9
Xolair 2,176 2,208 +5 4.9 4.8
Pulmozyme 452 543 –10 1.0 1.2
CellCept 393 503 –14 0.9 1.1
MabThera/Rituxan a) 369 476 –17 0.8 1.0
Esbriet 202 718 –70 0.5 1.6
Others 20 32 –30 0.0 0.2
Total Immunology 6,242 7,181 –7 14.0 15.8
Haemophilia A
Hemlibra 4,147 3,823 +16 9.3 8.4
Total Haemophilia A 4,147 3,823 +16 9.3 8.4
Ophthalmology b)
Vabysmo 2,357 591 +324 5.3 1.3
Lucentis 460 1,012 –52 1.0 2.2
Others 48 48 +6 0.1 0.1
Total Ophthalmology 2,865 1,651 +85 6.4 3.6
Infectious diseases
Ronapreve 525 1,679 –65 1.2 3.7
Others 531 482 +22 1.2 1.0
Total Infectious diseases 1,056 2,161 –45 2.4 4.7
Pharmaceuticals Division – Sales (continued)

(CHF m) (CHF m) (CER) (2023) (2022)
Other therapeutic areas b)
Activase/TNKase 1,173 1,177 +6 2.6 2.6
Mircera 426 408 +13 1.0 0.9
Others 1,171 1,338 –3 2.6 2.9
Total other therapeutic areas 2,770 2,923 +3 6.2 6.4
Total sales 44,612 45,551 +6 100 100
a) Total MabThera/Rituxan sales of CHF 1,630 million (2022: CHF 2,075 million) split between oncology and immunology therapeutic areas.
b) In 2023 sales of the ‘Ophthalmology’ therapeutic area included sales of Luxturna. These were previously shown as part of ‘Other therapeutic areas’. The comparative
Ocrevus. For relapsing forms of multiple sclerosis (RMS) and primary progressive multiple sclerosis (PPMS).
Ocrevus regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 4,684 4,487 +11 73.4 74.3
Europe 1,166 1,075 +12 18.3 17.8
International 531 474 +31 8.3 7.9
Total sales 6,381 6,036 +13 100 100
There was continuously growing demand in both indications primarily driven by the US, with the growth coming from both new
and retained patients. Elsewhere, Ocrevus continued to show high uptake, notably in Germany, Italy and Brazil.
Hemlibra. For haemophilia A.
Hemlibra regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 2,493 2,316 +14 60.1 60.6
Europe 845 741 +18 20.4 19.4
Japan 373 377 +12 9.0 9.9
International 436 389 +29 10.5 10.1
Total sales 4,147 3,823 +16 100 100
Sales growth continued, especially in the US in the non-inhibitor segment. In Europe and the International region, sales grew
across major markets, while sales in Japan increased as a result of further market penetration.
HER2 franchise (Perjeta, Kadcyla, Herceptin and Phesgo). For HER2-positive breast cancer and HER2-positive metastatic
(advanced) gastric cancer (Herceptin only).
Perjeta regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 1,336 1,533 –7 35.5 37.5
Europe 776 871 –8 20.6 21.3
Japan 215 234 +4 5.7 5.7
International 1,441 1,449 +16 38.2 35.5
Total sales 3,768 4,087 +1 100 100
Kadcyla regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 757 820 –2 38.5 39.4
Europe 577 671 –11 29.3 32.3
Japan 102 131 –12 5.2 6.3
International 530 458 +43 27.0 22.0
Total sales 1,966 2,080 +4 100 100
Herceptin regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 331 476 –26 20.4 22.2
Europe 353 422 –14 21.7 19.7
Japan 30 51 –33 1.8 2.4
International 912 1,193 –13 56.1 55.7
Total sales 1,626 2,142 –16 100 100
Phesgo regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 423 304 +48 37.8 41.1
Europe 534 367 +52 47.7 49.6
Japan 4 0 – 0.4 0.0
International 159 69 +189 14.1 9.3
Total sales 1,120 740 +64 100 100
Sales in the HER2 franchise increased by 3% at CER to CHF 8.5 billion. Sales of Perjeta grew by 1%, with the International
region, particularly China and Brazil, being a key growth driver. This was partly offset by a decline in sales in the US as a result
of an adjustment in the reserves related to US governmental plans. Excluding this adjustment, Perjeta sales in the US showed
a growth of 1%. Sales of Perjeta in Europe were lower following the launch of Phesgo. Sales of Kadcyla increased by 4%, with
sales growth in the International region, mainly in China, being partially offset by a sales decline in Europe, the US and Japan.
Herceptin sales were 16% lower as a result of biosimilar erosion. Phesgo sales showed a considerable uptake in Europe, the
US and the International region due to continued switching of patients to Phesgo as the treatment preferred over Perjeta and
Herceptin.
Tecentriq. For extensive-stage small cell lung cancer (SCLC), initial therapy of non-squamous non-small cell lung cancer
(NSCLC), advanced lung cancer, unresectable or metastatic hepatocellular carcinoma (HCC), advanced bladder cancer and
PD-L1-positive triple-negative breast cancer (TNBC).
Tecentriq regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 1,941 1,975 +4 51.5 53.1
Europe 845 794 +10 22.4 21.4
Japan 419 443 +8 11.1 11.9
International 561 505 +29 15.0 13.6
Total sales 3,766 3,717 +9 100 100
Sales increased by 9% with growth across all regions. In the US sales were higher driven by the NSCLC adjuvant indication.
In Europe the growth was mainly driven by the SCLC and HCC indications. In Japan the sales increase came from growth in the
NSCLC adjuvant indication. In the International region China was the key growth driver.
Vabysmo. For neovascular or ‘wet’ age-related macular degeneration (nAMD), diabetic macular oedema (DME) and in the US
also for macular oedema following retinal vein occlusion (RVO).
Vabysmo regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 1,914 517 +293 81.2 87.5
Europe 276 22 Over +500 11.7 3.7
Japan 98 47 +138 4.2 8.0
International 69 5 Over +500 2.9 0.8
Total sales 2,357 591 +324 100 100
Sales in the US showed a high uptake following approval in January 2022 and there was continued growth of market share in
nAMD and DME, driven by new patients and patients switching from existing treatment options. In Europe, the UK and Germany
were the main growth drivers. Sales also grew in Japan and in the International region, driven by sales in Australia and Canada.
Actemra/RoActemra. For rheumatoid arthritis, forms of juvenile idiopathic arthritis, giant cell arteritis, CAR T-cell-induced
severe or life-threatening cytokine release syndrome and COVID-19.
Actemra/RoActemra regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 1,223 1,196 +9 46.5 44.3
Europe 775 802 0 29.5 29.7
Japan 311 342 +3 11.8 12.7
International 321 361 +4 12.2 13.3
Total sales 2,630 2,701 +5 100 100
Sales increased by 5%, mainly in the US, despite lower demand from hospitalised patients with COVID-19. The demand outside
of COVID-19 increased based on continued confidence in the medicine, especially in the rheumatoid arthritis segment. The first
biosimilar versions of Actemra/RoActemra came to market in the EU in the fourth quarter of 2023. Based on publicly available
information, the Group currently anticipates that the first biosimilar versions could come to market in the US in the first half of
2024.
Xolair. For chronic spontaneous urticaria and allergic asthma.
Xolair regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 2,176 2,208 +5 100 100
Total sales 2,176 2,208 +5 100 100
Sales increased by 5% driven by growth in the chronic spontaneous urticaria indication and stabilisation of new patient share
in the allergic asthma indication. Xolair is the only biologic approved for chronic spontaneous urticaria and remains a market
leader in the larger allergic asthma indication.
MabThera/Rituxan. For non-Hodgkin lymphoma (NHL), chronic lymphocytic leukaemia (CLL), follicular lymphoma (FL),
pemphigus vulgaris (PV), rheumatoid arthritis (RA) as well as certain types of antineutrophil cytoplasmic antibody (ANCA)-
associated vasculitis.
MabThera/Rituxan regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 987 1,316 –20 60.6 63.4
Europe 180 204 –9 11.0 9.8
Japan 24 32 –13 1.5 1.5
International 439 523 –6 26.9 25.3
Total sales 1,630 2,075 –15 100 100
Sales were 15% lower due to biosimilar erosion across all regions. Sales in the US decreased by 20%, with a decline in both the
oncology and immunology segments.
Avastin. For advanced colorectal, breast, lung, kidney, cervical and ovarian cancer, relapsed glioblastoma and liver cancer in
combination with Tecentriq.
Avastin regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 484 634 –19 30.8 29.9
Europe 98 193 –47 6.2 9.1
Japan 318 490 –26 20.2 23.1
International 673 805 –7 42.8 37.9
Total sales 1,573 2,122 –19 100 100
Sales decreased across all regions, mainly in Japan and the US due to the continuing impact of biosimilars. The sales decline
in Europe was driven by Germany and Italy, while in the International region, the main reason for the sales decline was biosimilar
competition in China.
Alecensa. For ALK-positive non-small cell lung cancer (NSCLC).
Alecensa regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 467 453 +9 31.1 29.9
Europe 292 292 +4 19.4 19.3
Japan 212 228 +5 14.1 15.1
International 531 540 +11 35.4 35.7
Total sales 1,502 1,513 +8 100 100
The global uptake continued with an 8% increase in sales. The International region was one of the main drivers, notably China
following the inclusion in the National Reimbursement Drug List (NRDL). In the US, Alecensa remains the standard of care, and
the growth was driven by new and continuing patients.
Evrysdi. For spinal muscular atrophy (SMA).
Evrysdi regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 505 470 +14 35.6 42.0
Europe 509 353 +49 35.9 31.5
Japan 93 84 +26 6.6 7.5
International 312 212 +80 21.9 19.0
Total sales 1,419 1,119 +39 100 100
Sales were 39% higher, due to continuous gains in patient share including expansion into adult patient population and there
was sales growth across all regions. In Europe the growth continued in all markets, including in Spain where Evrysdi was recently
launched. In the International region, Brazil, Canada and China were among the growth drivers.
Activase/TNKase. For acute ischaemic stroke (AIS) and acute myocardial infarction (AMI).
Activase/TNKase regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 1,112 1,114 +6 94.8 94.6
International 61 63 +5 5.2 5.4
Total sales 1,173 1,177 +6 100 100
Sales were 6% higher mainly due to increasing demand for the AIS indication in the US.
Ronapreve. For the treatment of recently diagnosed high-risk patients with mild to moderate COVID-19.
Ronapreve regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
Europe 5 101 –95 1.0 6.0
Japan 519 1,480 –60 98.9 88.1
International 1 98 –99 0.1 5.9
Total sales 525 1,679 –65 100 100
Sales of Ronapreve decreased by 65% reflecting lower sales due to the evolving COVID-19 situation.
Lucentis. For neovascular or ‘wet’ age-related macular degeneration (nAMD), macular oedema following retinal vein occlusion
(RVO), diabetic macular oedema (DME) and diabetic retinopathy (DR).
Lucentis regional sales

(CHF m) (CHF m) (CER) (2023) (2022)
United States 460 1,012 –52 100 100
Total sales 460 1,012 –52 100 100
The first biosimilar version of Lucentis with a restricted label came to market in the US in the third quarter of 2022. Sales in the
US decreased by 52% due to the ongoing switch of patients from Lucentis to Vabysmo and competitive pressure.
Pharmaceuticals Division – Sales by region

(CHF m) (CHF m) (CER) (2023) (2022)
United States 23,606 23,322 +8 52.9 51.2
Europe 8,306 8,143 +6 18.6 17.8
Japan 3,745 4,949 –14 8.4 10.9
International 8,955 9,137 +13 20.1 20.1
– of which China 2,875 3,039 +6 6.4 6.7
Total sales 44,612 45,551 +6 100 100
United States. Sales grew by 8% due to increased sales of Vabysmo, Ocrevus, Hemlibra, Polivy and Phesgo, partially offset by
a combined 21% fall in MabThera/Rituxan, Herceptin and Avastin sales and also by lower sales of Lucentis and Esbriet. Vabysmo
showed a high uptake, with both new patients and patients switching from other medications and achieved CHF 1.9 billion of
sales. Ocrevus sales increased by 11% and were driven by both new and retained patients. Hemlibra sales were 14% higher due
to continued growth in the non-inhibitor segment. Polivy sales increased by 119% as a result of higher demand for the first-line
treatment of diffuse large B-cell lymphoma (1L DLBCL). Phesgo sales increased by 48%, attributed to the continued switching
of patients to Phesgo as the treatment preferred over Perjeta and Herceptin. Lucentis and Esbriet sales decreased by 52% and
74% respectively due to competitive pressure.
Europe. Sales increased by 6% driven by the launch of Vabysmo and uptake of Phesgo, Evrysdi, Hemlibra and Ocrevus, partially
offset by a combined sales decline of 20% for MabThera/Rituxan, Herceptin and Avastin. The uptake of Vabysmo was driven by
the UK and Germany. The high uptake of Phesgo resulted in a 52% sales growth, with Spain, Italy, Romania and France being the
key drivers. There was a sales growth of 49% for Evrysdi, with the main drivers being Italy, Germany, France and Spain. Hemlibra
sales growth of 18% was driven by France and Germany. Ocrevus sales increased by 12% due to continued growth across major
markets, primarily in Germany and Italy. Sales of Ronapreve were lower.
Japan. Sales decreased by 14%, mainly due to lower Ronapreve sales and reduced sales of Avastin arising from biosimilar
competition. These were partially offset by sales growth of new products such as Polivy and Vabysmo. Price cuts in Japan had
an impact across the portfolio.
International. Sales increased by 13%, led by Perjeta, Kadcyla, Evrysdi, Ocrevus and Tecentriq. Sales in China increased by
6% mainly driven by Tamiflu, Xofluza, Polivy, Tecentriq and Perjeta, partially offset by biosimilar erosion of MabThera/Rituxan,
Herceptin and Avastin and lower sales of CellCept.
Operating results
Effective 1 January 2023, the Group has made certain presentational and cost allocation changes to the income statement.
The comparative information for 2022 has been restated accordingly. Details are given on page 45.
Pharmaceuticals Division – Other revenue

2023 2022 % change
(CHF m) (CHF m) (CER)
Royalty income 835 924 –6
Profit-share income 695 689 +7
Other income from collaboration and out-licensing agreements 124 842 –83
Other 13 10 +16
Total – IFRS and Core basis 1,667 2,465 –27
Other revenue decreased by 27% at CER. Royalty income was 6% lower, mainly due to lower Lucentis royalties following
a decline in sales outside the US. Profit-share income was 7% higher due to the increase in income from the US sales of
Venclexta/Venclyxto and sales of Xolair outside the US. Other income from collaboration and out-licensing agreements
decreased significantly due to the Ultomiris patent settlement income of CHF 726 million in 2022.
Pharmaceuticals Division – Cost of sales

2023 2022 % change
Manufacturing cost of goods sold and period costs (5,042) (5,181) +1
Royalty expenses (1,729) (1,614) +15
Collaboration and profit-sharing agreements (1,547) (2,076) –20
Amortisation of commercial software intangible assets (3) (3) +9
Impairment of property, plant and equipment and right-of-use assets (22) (31) –17
Cost of sales – Core basis (8,343) (8,905) –1
Global restructuring plans (316) (251) +32
Amortisation of intangible assets (241) (412) –39
Impairment of intangible assets (183) (1,472) –87
Total – IFRS basis (9,083) (11,040) –13
Core costs decreased by 1% at CER despite the 6% increase in sales. As a percentage of sales, cost of sales decreased by
0.8 percentage points to 18.7%. Manufacturing costs were impacted in 2023 by various factors related to COVID-19 products,
including a release of unutilised provisions previously recorded for the COVID-19 response related to Ronapreve and AT-527.
In addition there was an overall positive product mix and lower distribution costs. Excluding these, manufacturing costs were
broadly in line with the increase in sales volumes. Royalty expenses were 15% higher driven by increased sales of certain
royalty-bearing products, notably Ocrevus and Evrysdi. Collaboration and profit-share expenses decreased by 20% as a result
of lower sales of Ronapreve outside of the US and MabThera/Rituxan in the US.
The costs of global restructuring plans were higher due to the manufacturing network strategy review mainly affecting the
US sites. The decrease in amortisation charges of intangible assets was primarily attributable to the impairments recorded
in 2022 in relation to Gavreto, Rozlytrek and the technologies of Flatiron Health and Foundation Medicine. In 2023 a further
partial impairment was recorded in relation to Rozlytrek triggered by reduced sales expectations.
Pharmaceuticals Division – Research and development

2023 2022 % change
Research and development – Core basis (11,490) (11,420) +6
Global restructuring plans (155) (263) –36
Impairment of intangible assets (406) (1,365) –69
Total – IFRS basis (12,352) (13,384) –2
Core costs increased by 6% at CER and, as a percentage of sales, increased by 0.7 percentage points to 25.8%. Oncology
remained the primary area of research and development and the main driver of the growth. Neuroscience, ophthalmology and
immunology also represented significant areas of spending. The increase in spending was mainly driven by a study of giredestrant,
a next-generation selective oestrogen receptor degrader for people with hormone receptor-positive HER2-negative breast
cancer and a study of astegolimab in chronic obstructive pulmonary disease together with further investments made in oncology
and multiple sclerosis. This was partially offset by decreased spend in studies of some molecules, notably for gantenerumab
following the negative trial readout in November 2022. In research and early-stage development, the increase in costs was mostly
driven by investments in computational biology. Investments made in new facilities additionally contributed to the increased
costs, including the Clinical Supply Center in South San Francisco, US, and the Chugai Life Science Park in Yokohama, Japan.
Both facilities started initial operations in the second half of 2022 with a consequent impact on depreciation expenses.
Additionally, in-licensing transactions, business combinations and asset acquisitions resulted in intangible assets of CHF 7.2 billion
(2022: CHF 1.2 billion) being recognised, of which CHF 6.2 billion arose from the Telavant asset acquisition. See the above
sections on ‘Mergers and acquisitions’ and ‘Alliance transactions’ for further details.
Global restructuring plan expenses mainly related to the infrastructure strategy optimisation programme as well as employee-
related expenses based on the new research and development productivity and portfolio prioritisation initiatives. Amortisation
of intangible assets decreased as a result of the impairments recognised in 2022. Impairment charges for intangible assets of
CHF 0.4 billion related to assets in development were mainly triggered by the decision to discontinue the programmes.
Pharmaceuticals Division – Selling, general and administration

2023 2022 % change
Marketing and distribution (5,836) (5,916) +6
Administration (1,104) (1,193) –1
Business taxes and capital taxes (173) (160) +18
Other general items (102) (55) +90
Selling, general and administration – Core basis (7,215) (7,324) +6
Total – IFRS basis (7,945) (7,598) +12
Core costs increased by 6% at CER, and as a percentage of sales increased by 0.1 percentage points to 16.2%. Marketing
and distribution costs increased by 6% reflecting the investments in ongoing launches, especially of Vabysmo. Business taxes
and capital taxes increased due to the relatively low US excise tax in 2022, while the higher costs in other general items were
caused by various items including costs for the underutilisation of facilities post-COVID-19 and higher energy costs. Costs
for global restructuring plans included asset impairments at sites in the US driven by infrastructure optimisation and business
process transformations.
Pharmaceuticals Division – Other operating income (expense)

2023 2022 % change
Gains (losses) on disposal of products 558 612 –6
Gains (losses) on disposal of property, plant and equipment and right-of-use assets 7 5 +74
Pensions – past service costs 0 4 –
Other income (expense) 193 143 +43
Other operating income (expense) – Core basis 758 764 +3
Global restructuring plans 80 (14) –
Impairment of goodwill (591) 0 –
Mergers and acquisitions and alliance transactions (14) 6 –
Legal and environmental cases 0 16 –
Total – IFRS basis 233 772 –69
Core other operating income (expense) increased by 3% at CER driven by a 43% increase in other income (expense) mainly due
to higher income from positive resolution of disputes in some countries. Gains on disposal of products in 2023 included the
sale of rights for Rocephin in China for CHF 260 million and the sale of rights for Xeloda in China and Japan for CHF 235 million.
In 2022, the gains on disposal of products included CHF 272 million for the sale of rights for Rocaltrol in China, the sale of global
rights for Valcyte for CHF 185 million and the sale of global rights for Xeloda excluding China and Japan for CHF 150 million.
Income from global restructuring plans was related to the gain from the disposal of property. The goodwill resulting from the
Foundation Medicine acquisition was fully impaired. Legal and environmental cases income recorded in 2023 included the
reimbursement of a fine imposed in 2020 by the French Competition Authority on the Avastin/Lucentis investigation following a
court decision. This was largely offset by the increase in provisions for environmental matters at the Clarecastle site in Ireland.
Roche Pharmaceuticals and Chugai subdivisional operating results
Pharmaceuticals subdivisional operating results in millions of CHF

Roche Pharmaceuticals Chugai Pharmaceuticals Division
2023 2022 2023 2022 2023 2022
Sales
– External customers 40,867 40,602 3,745 4,949 44,612 45,551
– Within division 1,943 3,384 2,490 2,602 4,433 5,986
Core operating profit 16,664 17,576 2,976 4,052 19,989 21,131
– Margin, % of sales to external customers 40.8 43.3 79.5 81.9 44.8 46.4
Operating profit 13,868 13,275 2,915 3,988 17,132 16,766
Operating free cash flow 14,233 15,315 3,542 2,359 17,728 17,694
Pharmaceuticals Division total core operating profit and operating profit both include the elimination of plus CHF 349 million of unrealised intercompany gains between
Roche Pharmaceuticals and Chugai (2022: minus CHF 497 million).
The appreciation of the Swiss franc against the Japanese yen had an adverse impact of approximately 8 percentage points on
the Chugai core results when expressed in Swiss francs for the Group’s consolidated results. At CER (as reported in Japanese yen),
sales by Chugai to external customers decreased by 14% due to lower sales of Ronapreve, while sales within the division
increased by 9% due to higher sales of Hemlibra and Alecensa by Chugai to Roche Pharmaceuticals. Chugai’s core operating
profit decreased by 19% driven by the income from the Ultomiris patent settlement in 2022 and higher research and development
costs. This was partially offset by higher other operating income coming from the sale of product rights. Operating free cash
flow at Chugai increased by 69% due in part to the payment received in 2023 for Ronapreve sales recorded in December 2022.
Financial position
Pharmaceuticals Division – Net operating assets
Movement: Movement:
2023 2022 % change % change Transactions CTA and other
(CHF m) (CHF m) (CHF) (CER) (CHF m) (CHF m)
Trade receivables 8,009 8,617 –7 +3 268 (876)
Inventories 4,849 5,259 –8 –1 (5) (405)
Trade payables (2,110) (2,363) –11 –4 96 157
Net trade working capital 10,748 11,513 –7 +3 359 (1,124)
Other receivables (payables) (7,302) (7,722) –5 +2 (132) 552
Net working capital 3,446 3,791 –9 +6 227 (572)
Property, plant and equipment 14,423 15,788 –9 –3 (380) (985)

Right-of-use assets 882 845 +4 +14 115 (78)
Goodwill and intangible assets 18,025 13,676 +32 +43 5,454 (1,105)
Provisions (1,799) (2,392) –25 –20 486 107
Other assets (liabilities) 1,529 848 +80 +96 734 (53)
Other net operating assets 33,060 28,765 +15 +24 6,409 (2,114)
Net operating assets 36,506 32,556 +12 +22 6,636 (2,686)
The absolute amount of the movement between the 2023 and 2022 consolidated balances reported in Swiss francs is split between actual 2023 transactions (translated at
average rates for 2022) and the currency translation adjustment (CTA) that arises on consolidation. The 2023 transactions include non-cash movements and therefore the
movements in this table are not the same as the amounts shown in the operating free cash flow (which only includes the cash movements). A full consolidated balance sheet is
given on page 49 of the Annual Financial Statements, and a reconciliation between that balance sheet and the information given above is on pages 179–180.
Currency translation effects on balance sheet amounts. Compared to the start of the year the Swiss franc appreciated
against most currencies, with the US dollar and the Japanese yen both having a significant negative translation effect on the
net operating assets of the Pharmaceuticals Division. The exchange rates used are given on page 32.
Net working capital. Trade receivables increased by 3% due to increased sales of Vabysmo and Ocrevus that had extended
payment terms in the US. This was partially offset by the receipt of cash from Ronapreve sales in Japan in December 2022.
The decrease in trade payables of 4% included payments for the construction of the Yokohama research and development site
in Japan. The net liability position for other receivables (payables) increased by 2% due to higher other taxes payable partly
compensated by lower profit-share expense accruals to Regeneron in relation to Ronapreve sales.
Other net operating assets. Property, plant and equipment decreased by 3% due to depreciation expenses and the transfer
of assets at the Vacaville manufacturing site from property, plant and equipment to assets held for sale, which caused a
corresponding increase in other assets. This was partially offset by additions for manufacturing investments and site developments.
Right-of-use assets increased due to the new lease at Foundation Medicine. The Telavant asset acquisition increased intangible
assets by CHF 6.2 billion. Conversely, goodwill decreased due to impairment charges of CHF 0.6 billion for the full write-off
of goodwill from the Foundation Medicine acquisition. Provisions decreased due to the release of certain previously recorded
positions.
Free cash flow
Pharmaceuticals Division – Operating free cash flow

Operating profit 17,132 16,766 +2 +14
Depreciation, amortisation and impairment 3,790 5,306 –29 –25

Provisions (506) (248) +104 +108
Equity compensation plans 634 560 +13 +20
Other 398 150 +165 +179
Operating profit cash adjustments 4,316 5,768 –25 –21
Operating profit, net of operating cash adjustments 21,448 22,534 –5 +5

(Increase) decrease in net working capital (714) (1,745) –59 –59
Investments in property, plant and equipment (1,936) (1,744) +11 +18
Principal portion of lease liabilities paid (215) (274) –22 –15
Investments in intangible assets (855) (1,077) –21 –19
Operating free cash flow 17,728 17,694 0 +12
– as % of sales 39.7 38.8 +0.9 +2.3
See pages 176–178 for the definition of free cash flow and a detailed breakdown.
Effective 1 January 2023, the Group has made certain presentational and cost allocation changes to the income statement. These changes have a consequential impact
on the divisional free cash flow, although total Group free cash flow is unaffected. The comparative information for 2022 has been restated accordingly. Details are given on
page 45.
The Pharmaceuticals Division’s operating free cash flow increased by 12% at CER (stable in CHF) to CHF 17.7 billion. The cash
generation of the business, measured by the operating profit, net of operating cash adjustments, increased by 5% at CER.
This was in line with the increase in core operating profit. Net working capital absorbed an additional CHF 714 million of cash,
driven by the reasons described above in the ‘Financial position’ section. Capital expenditure was higher, due to manufacturing
investments in the US and Japan as well as site developments in the US. Investments in intangible assets were lower compared
to the prior year. Cash outflows for mergers and acquisitions, such as the Telavant asset acquisition, are not included in the
definition of free cash flow.
Diagnostics Division operating results
Diagnostics Division operating results

IFRS results
Sales 14,104 17,730 –20 –13
Other revenue 58 68 –15 –12
Revenue 14,162 17,798 –20 –13
Cost of sales (7,274) (8,697) –16 –12
Research and development (1,848) (1,841) 0 +5
– Margin, % of sales 15.4 23.4 –8.0 –5.2
Core results a)
Sales 14,104 17,730 –20 –13
Other revenue 58 68 –15 –12
Revenue 14,162 17,798 –20 –13
Cost of sales (6,908) (8,510) –19 –15
Selling, general and administration (2,899) (3,115) –7 0
Core operating profit 2,668 4,381 –39 –24
– Margin, % of sales 18.9 24.7 –5.8 –3.2
Financial position
Other net operating assets 12,690 13,250 –4 +3
Net operating assets 15,938 16,518 –4 +5
Free cash flow b)

Operating free cash flow 1,677 3,382 –50 –35
– Margin, % of sales 11.9 19.1 –7.2 –4.8

Sales
The Diagnostics Division reported sales of CHF 14.1 billion, a decline of 13% at CER due to the anticipated significant drop
in demand for COVID-19-related tests. Sales in the division’s base business increased by 7% at CER and across all regions,
with immunodiagnostic products, particularly cardiac tests, being the main growth drivers. The Diagnostics Division’s portfolio
of COVID-19 tests generated sales of CHF 0.8 billion in 2023 (2022: CHF 4.1 billion), a decline of 80% at CER.
Diagnostics Division – Sales by customer area

(CHF m) (CHF m) (CER) (2023) (2022)
Core Lab 7,750 7,775 +9 55.0 43.9
Molecular Lab 2,220 3,450 –30 15.7 19.5
Pathology Lab 1,388 1,318 +14 9.8 7.4
Point of Care 1,379 3,589 –58 9.8 20.2
Diabetes Care 1,367 1,598 –4 9.7 9.0
Total sales 14,104 17,730 –13 100 100
Core Lab. This customer area focuses on central labs and provides diagnostics solutions in the areas of immunoassays,
clinical chemistry and custom biotech. Sales increased by 9% at CER due to the 10% growth in immunodiagnostic products,
such as cardiac and oncology tests, and the 10% growth in the clinical chemistry business. Sales grew across all regions,
with the largest contributions to the sales growth coming from the Asia-Pacific and Europe, Middle East and Africa (EMEA)
regions, which grew by 10% and 9%, respectively.
Molecular Lab. This customer area focuses on molecular labs and provides diagnostics solutions for the detection and
monitoring of pathogens, donor screening, sexual health and genomics. Sales declined by 30% due to lower COVID-19-related
sales for SARS-CoV-2 assays on the cobas 6800/8800 systems. Growth in the underlying base business included higher sales
from blood screening as well as from diagnostics solutions for the detection and monitoring of cervical cancer and from the
virology base business.
Pathology Lab. This customer area focuses on pathology labs and provides diagnostics solutions for tissue biopsies and
companion diagnostics. These are targeted diagnostics to aid in the choice of specific therapies for each patient. Sales
increased by 14% and across all regions due to growth in the advanced staining and the companion diagnostics businesses.
Point of Care. This customer area provides diagnostics solutions immediately at the point of care, such as in emergency rooms,
general practitioners’ practices and directly with patients, and includes the SARS-CoV-2 Rapid Antigen tests and blood gas
and electrolyte (BGE) tests. Lower sales of the SARS-CoV-2 Rapid Antigen test were the main driver of the 58% sales decrease.
There was growth in the base business, driven by the Liat molecular point-of-care product line.
Diabetes Care. This customer area provides diagnostics solutions for patients and healthcare professionals enabling integrated
personalised diabetes management. Sales decreased by 4% driven by the continued contraction of the blood glucose monitoring
market in the US and major European markets, due to people switching to continuous glucose monitoring systems.
Diagnostics Division – Sales by region

(CHF m) (CHF m) (CER) (2023) (2022)
Europe, Middle East and Africa (EMEA) 4,768 5,888 –13 33.8 33.2
North America 3,826 5,141 –21 27.1 29.0
– of which US 3,424 4,518 –19 24.3 25.5
Asia-Pacific 4,496 5,639 –11 31.9 31.8
– of which China 2,475 2,580 +7 17.5 14.6
Latin America 1,014 1,062 +14 7.2 6.0
Total sales 14,104 17,730 –13 100 100
The decrease in global sales was due to the sharp decline in demand for COVID-19 tests. This was partly offset by growth in the
division’s base business, with sales increasing 7% at CER and across all regions. This was led by higher sales of immunodiagnostic
products, notably in the Asia-Pacific region, particularly in China, and in Europe, Middle East and Africa (EMEA).
Operating results
Diagnostics Division – Other revenue

2023 2022 % change
Royalty income 43 61 –28
Profit-share income 0 0 –
Other income from collaboration and out-licensing agreements 2 0 –
Other 13 7 +101
Total – IFRS and Core basis 58 68 –12
Other revenue decreased by 12% at CER driven by the base effect of lower royalty income following the settlement of a patent
dispute in Diabetes Care in 2022.
Diagnostics Division – Cost of sales

2023 2022 % change
Manufacturing cost of goods sold and period costs (6,774) (8,377) –15
Royalty expenses (125) (130) –2
Amortisation of commercial software intangible assets (2) (2) +44
Impairment of property, plant and equipment and right-of-use assets (7) (1) +425
Cost of sales – Core basis (6,908) (8,510) –15
Total – IFRS basis (7,274) (8,697) –12
Core cost of sales decreased by 15% at CER due to lower sales volumes of COVID-19-related products. The decrease was
higher than the sales decline of 13% because of the product mix from lower sales volumes of SARS-CoV-2 Rapid Antigen tests.
As a percentage of sales, the core cost of sales ratio increased by 1.0 percentage points to 49.0%. Global restructuring plan
costs were mainly employee-related expenses as well as impairments of property, plant and equipment following productivity
measures and manufacturing and supply chain optimisations.
Diagnostics Division – Research and development

2023 2022 % change
Research and development – Core basis (1,747) (1,835) –1
Global restructuring plans (75) 2 –
Impairment of intangible assets (19) 0 –
Total – IFRS basis (1,848) (1,841) +5
Core costs decreased by 1% at CER driven by targeted productivity initiatives. Digital solutions and sequencing represented
significant areas of spending. In addition, investments continued in diabetes solutions and mass spectrometry. As a percentage
of sales, research and development core costs increased to 12.4% from 10.3% in 2022. Global restructuring costs from
portfolio prioritisation and other measures to drive productivity were incurred for employee-related matters and the termination
of contractual obligations.
Diagnostics Division – Selling, general and administration

2023 2022 % change
Marketing and distribution (2,477) (2,668) 0
Administration (400) (428) 0
Other general items 0 4 –
Selling, general and administration – Core basis (2,899) (3,115) 0
Total – IFRS basis (3,042) (3,170) +3
Core selling, general and administration costs remained stable at CER. Marketing and distribution costs included a drop
in distribution costs related to SARS-CoV-2 Rapid Antigen tests that was partly offset by higher inventory write-offs.
Administration costs also remained stable. On a core basis, selling, general and administration costs as a percentage of sales
increased to 20.6% compared to 17.6% in 2022. Costs for global restructuring plans primarily comprised employee-related
expenses following productivity measures to remove organisational duplication and drive commercial effectiveness.
Diagnostics Division – Other operating income (expense)

2023 2022 % change
Gains (losses) on disposal of property, plant and equipment and right-of-use assets 3 0 –
Gains (losses) on divestment of subsidiaries 1 1 +4
Other income (expense) 56 42 +45
Other operating income (expense) – Core basis 60 43 +50
Global restructuring plans (6) 0 –
Mergers and acquisitions and alliance transactions (5) 14 –
Legal and environmental cases 124 2 Over +500
Total – IFRS basis 173 59 +214
Core other operating income (expense) increased by 50% at CER. Mergers and acquisitions and alliance transaction costs in
2022 included income of CHF 27 million from the release of contingent consideration provisions. The income from legal and
environmental cases in 2023 was due to the reversal of legal provisions.
Financial position
Diagnostics Division – Net operating assets
Movement: Movement:
2023 2022 % change % change Transactions CTA and other
(CHF m) (CHF m) (CHF) (CER) (CHF m) (CHF m)
Trade receivables 3,118 3,108 0 +14 362 (352)
Inventories 2,900 3,346 –13 –8 (278) (168)
Trade payables (1,097) (1,282) –14 –6 101 84
Net trade working capital 4,921 5,172 –5 +5 185 (436)
Other receivables (payables) (1,673) (1,904) –12 –5 111 120
Net working capital 3,248 3,268 –1 +11 296 (316)
Property, plant and equipment 6,997 7,016 0 +7 460 (479)

Right-of-use assets 299 239 +25 +37 85 (25)
Goodwill and intangible assets 6,193 6,829 –9 –2 (128) (508)
Provisions (766) (832) –8 –2 17 49
Other assets (liabilities) (33) (2) Over +500 Over +500 (34) 3
Other net operating assets 12,690 13,250 –4 +3 400 (960)
Net operating assets 15,938 16,518 –4 +5 696 (1,276)
The absolute amount of the movement between the 2023 and 2022 consolidated balances reported in Swiss francs is split between actual 2023 transactions (translated at
average rates for 2022) and the currency translation adjustment (CTA) that arises on consolidation. The 2023 transactions include non-cash movements and therefore the
movements in this table are not the same as the amounts shown in the operating free cash flow (which only includes the cash movements). A full consolidated balance sheet is
given on page 49 of the Annual Financial Statements, and a reconciliation between that balance sheet and the information given above is on pages 179–180.
Currency translation effects on balance sheet amounts. Compared to the start of the year the Swiss franc appreciated
against most currencies, with the US dollar having a significant negative translation effect on the net operating assets of
the Diagnostics Division. The Diagnostics Division does not have a significant net asset position in Japanese yen and so the
appreciation of the Swiss franc against the Japanese yen had only a minor impact. The exchange rates used are given on
page 32.
Net working capital. The 11% increase in net working capital was driven by higher trade receivables. These increased by 14%
due to higher sales in the last quarter of 2023 compared to the same period of 2022 and also due to the base effect from
higher collections towards the end of 2022. Inventories decreased by 8% due to lower inventory levels of COVID-19-related
products. Trade payables decreased by 6% compared to the relatively high balances at the end of 2022. The decrease in
net liability for other receivables (payables) came from higher employee-related accruals in 2022.
Other net operating assets. Property, plant and equipment increased as a result of higher instrument placements and from
site investments in Germany and the US. Goodwill and intangible assets decreased due to the regular amortisation charges.
Provisions included a release of legal provisions that was partially offset by increased restructuring provisions following the
launch of several productivity initiatives.
Free cash flow
Diagnostics Division – Operating free cash flow

Depreciation, amortisation and impairment 1,465 1,434 +2 +9

Provisions (1) (225) –100 –98
Equity compensation plans 113 102 +11 +15
Other 366 391 –6 0
Operating profit cash adjustments 1,943 1,702 +14 +21
Operating profit, net of operating cash adjustments 4,114 5,851 –30 –17
(Increase) decrease in net working capital (551) (706) –22 –8
Investments in property, plant and equipment (1,722) (1,619) +6 +14
Principal portion of lease liabilities paid (112) (118) –5 +2
Investments in intangible assets (52) (26) +100 +103
Operating free cash flow 1,677 3,382 –50 –35
– as % of sales 11.9 19.1 –7.2 –4.8
For the definition of free cash flow and a detailed breakdown see pages 176–178.
on the divisional free cash flow, although total Group free cash flow is unaffected. The comparative information for 2022 has been restated accordingly. Details are given on
page 45.
The operating free cash flow of the Diagnostics Division decreased by 35% at CER (decrease of 50% in CHF) driven by the
operating results of the business. The cash generation of the business, measured by the operating profit, net of operating cash
adjustments, decreased by 17% compared to the 24% decrease in the core operating profit because of lower utilisations of
provisions and higher non-cash expenses. Net working capital absorbed CHF 0.6 billion of cash in 2023 which was attributable
to the increased receivables as well as the settlement of relatively high payables and accruals at the end of 2022 as described
above in the ‘Financial position’ section. Capital expenditure increased due to higher instrument placements as well as site
investments in Germany and the US.
Corporate operating results
Corporate – Selling, general and administration

2023 2022 % change
Administration (3,389) (3,320) +5
Other general items 0 1 –100
Selling, general and administration – Core basis (3,404) (3,328) +5
Total – IFRS basis (3,894) (3,433) +16
Selling, general and administration costs increased by 5% at CER on a core basis. Administration costs were higher due to
increased project costs and demand for informatics and human resources. The increase was also related to the transfer
of building, equipment and energy costs from the Pharmaceuticals and Diagnostics Divisions. Total costs on an IFRS basis
increased by 16% due to a higher level of restructuring activities mainly due to the business process transformation to simplify
the systems landscape and reduce process complexity and also for transformations in informatics.
Corporate – Other operating income (expense)

2023 2022 % change
Other income (expense) (13) (11) +21
Other operating income (expense) – Core basis (13) (11) +21
Global restructuring plans 1 1 0
Legal and environmental cases (2) 4 –
Total – IFRS basis (14) (6) +128
Corporate financial position and free cash flow

2023 2022 % change
Financial position
Net working capital (487) (337) +48
Other net operating assets 158 182 –6
Net operating assets (329) (155) +113
Free cash flow

Operating free cash flow (3,637) (3,403) +10
The change in net operating assets came from a shift of net working capital and property, plant and equipment for functions with
global accountability such as informatics, human resources and finance from the Pharmaceuticals and Diagnostics Divisions.
The operating free cash flow includes costs of corporate functions such as informatics, human resources, finance and procurement,
and also restructuring costs for the business process transformation. There was an increased outflow mainly due to higher
restructuring activities, partially offset by higher payables.
Foreign exchange impact on operating results
The Group’s exposure to movements in foreign currencies affecting its operating results, as expressed in Swiss francs,
is summarised by the following key figures and comments.
Growth (reported in Swiss francs and at CER)

% change % change
(CHF) (CER)
Pharmaceuticals Division
Sales –2 +6
Core operating profit –5 +5
Operating free cash flow 0 +12
Diagnostics Division
Sales –20 –13
Core operating profit –39 –24
Operating free cash flow –50 –35
Group
Sales –7 +1
Core operating profit –13 –1
Operating free cash flow –11 +4
Exchange rates against the Swiss franc
31 December 2023 Average 2023 31 December 2022 Average 2022

1 USD 0.84 0.90 0.92 0.95
1 EUR 0.93 0.97 0.98 1.00
100 JPY 0.60 0.64 0.69 0.73
The results expressed in Swiss francs were negatively impacted by the appreciation of the Swiss franc against many currencies.
The sensitivity of Group sales and core operating profit to a 1% change in average foreign currency exchange rates against the
Swiss franc during 2023 is shown in the table below.
Currency sensitivities
Impact of 1% increase in average exchange rate Sales Core operating profit
versus the Swiss franc (CHF m) (CHF m)
US dollar 280 90
Euro 88 31
Japanese yen 45 46
All other currencies 158 86
The Group’s revenues are primarily generated from sales of products to customers. Such revenues are mainly received in the
local currency of the customer’s home market, although in certain emerging markets invoicing is made in major international
currencies such as the US dollar and euro. Cost of sales, marketing and some administration costs follow the same currency
pattern as sales. The majority of research and development activities take place at the Group’s global research facilities, and
therefore the costs are mainly concentrated in US dollars, Swiss francs and euros. Administration costs are incurred at central
locations in the US, Switzerland and Germany, and increasingly at shared service centres in other locations. Chugai’s revenues
and costs are denominated in Japanese yen.
Treasury and taxation results
Treasury and taxation results

IFRS results
Operating profit 15,395 17,476 –12 +3
Profit before taxes 14,079 16,327 –14 +1
Income taxes (1,721) (2,796) –38 –27
Net income 12,358 13,531 –9 +7
Attributable to
Core results a)
Profit before taxes 17,940 20,959 –14 –2
Income taxes (2,136) (3,429) –38 –28
Net income 15,804 17,530 –10 +3
Attributable to
Financial position
Net debt (18,699) (15,584) +20 +26
Lease liabilities (1,573) (1,193) +32 +44
Pensions (3,360) (3,604) –7 0
Income taxes 4,376 2,908 +50 +68
Equity investments 547 671 –18 –6
Derivatives, net (272) (459) –41 –32
Collateral, net 50 180 –72 –72
Interest payable (187) (140) +34 +44
Associated companies and other, net 266 317 –16 –25
Total net assets (liabilities) (18,852) (16,904) +12 +16
Free cash flow b)

Treasury activities (860) (530) +62 +72
Taxes paid (3,620) (4,102) –12 –5
Total (4,480) (4,632) –3 +4

Financing costs
Core financing costs were CHF 1.0 billion, an increase of 52% at CER compared to 2022. Interest expenses on debt increased
by 44% at CER to CHF 797 million due to the issuance of new debt as well as an increase in interest rates which affected short-
term borrowing costs. A full analysis of financing costs is given in Note 4 to the Annual Financial Statements.
Other financial income (expense)
Core other financial income (expense) was a net expense of CHF 320 million compared to a net expense of CHF 528 million in 2022.
The core income from equity securities, which reflects the fair value changes in the Roche Venture Fund investments as well
as gains or losses realised upon sale of those investments, was a gain of CHF 4 million compared to a loss of CHF 123 million
in 2022. The net foreign exchange results, which reflect hedging costs and gains and losses on unhedged positions, were
net losses of CHF 243 million (2022: net losses of CHF 278 million). Losses on the net monetary positions in hyperinflationary
economies in Argentina and Türkiye were CHF 233 million (2022: losses of CHF 70 million) with the increase following from the
devaluation in Argentina in December 2023. A full analysis of other financial income (expense) is given in Note 4 to the Annual
Financial Statements.
Income taxes
Analysis of the Group’s effective tax rate
2023 2022
Profit Income Profit Income
before tax taxes Tax rate before tax taxes Tax rate
(CHF m) (CHF m) (%) (CHF m) (CHF m) (%)
Group’s effective tax rate – Core basis 17,940 (2,136) 11.9 20,959 (3,429) 16.4
Global restructuring plans (2,038) 403 19.8 (969) 193 19.9
Goodwill and intangible assets (1,910) 115 6.0 (3,770) 515 13.7
Mergers and acquisitions and alliance transactions (25) 4 16.0 65 1 –
Legal and environmental cases 112 (39) 34.8 42 (8) 19.0
Pension plan settlements 0 0 – 0 0 –
Normalisation of equity compensation plan tax benefit 0 (68) – 0 (68) –
Group’s effective tax rate – IFRS basis 14,079 (1,721) 12.2 16,327 (2,796) 17.1
The Group’s effective core tax rate decreased by 4.5 percentage points to 11.9% in 2023. The decrease was due to the impact
from the resolution of several tax disputes which reduced the Group’s effective core tax rate by 4.3 percentage points in 2023
compared to 1.5 percentage points in 2022. The lower percentage of core profit contribution coming from tax jurisdictions with
tax rates higher than the Group’s average tax rate further reduced the Group’s effective core tax rate.
The effective tax rate on an IFRS basis decreased to 12.2% compared to 17.1% in 2022 due to the same impacts mentioned
above and due to the deferred tax impacts from the global restructuring plans partially offset by the impairments of goodwill
and certain intangible assets that are not tax deductible.
The Organisation for Economic Co-operation and Development (OECD) has published Global Anti-Base Erosion (GloBE) Model
Rules (Pillar Two) which aim to ensure that large multinational enterprises pay a minimum level of tax on the income arising
in each of the jurisdictions where they operate. The Model Rules provide for a template that jurisdictions can translate into
domestic law as part of a common approach to applying top-up taxes on profits arising in a jurisdiction whenever the effective
tax rate, determined on a jurisdictional basis in accordance with the Model Rules, is below the minimum rate of 15%. Various
countries intend to enact or have enacted tax legislation to either fully or partially comply with Pillar Two, including Switzerland
from 1 January 2024.
Further details of the Group’s income tax expenses and related balance sheet positions, as well as the implementation of the
Pillar Two Model Rules, are given in Note 5 to the Annual Financial Statements.
Financial position
The increase in net debt was due to dividend payments of CHF 7.9 billion and the payments for the Telavant asset acquisition of
CHF 6.2 billion, partly offset by the free cash flow of CHF 11.3 billion. Lease liabilities increased to CHF 1.6 billion mainly due
to the new laboratory and office space lease for Foundation Medicine. The net pension liability remained stable at CER as the
increase in fair value of plan assets was offset by lower discount rates. The net tax assets, consisting mostly of deferred tax
assets, increased in total due to the decrease in current income tax liabilities following the resolution of tax disputes in 2023. At
31 December 2023 the Group held equity investments with a market value of CHF 0.5 billion, which consist mostly of holdings
in biotechnology and other pharmaceuticals companies which were acquired as part of licensing transactions and scientific
collaborations or as investments of the Roche Venture Fund. The net derivative liabilities decreased to CHF 0.3 billion as a result
of interest rate and exchange rate movements.
Free cash flow
The net cash outflow from treasury activities was CHF 0.9 billion compared to an outflow of CHF 0.5 billion in 2022. This was
due to increased interest payments as a result of the newly issued debt and higher interest rates, as well as additional pension
contributions to certain of the Group’s pension plans in the US. Total taxes paid in 2023 were down by 5% at CER, driven by
lower tax payments in the US.
Cash flows and net debt
Operating free cash flow in billions of CHF Free cash flow in billions of CHF
0 5 10 15 20 0 5 10 15 20
2023 15.8 11.3
2022 17.7 13.0
2021 19.4 15.7
Free cash flow in millions of CHF

2023
Operating profit – IFRS basis 17,132 2,171 (3,908) 15,395
Operating profit cash adjustments 4,316 1,943 209 6,468
Operating profit, net of operating cash adjustments 21,448 4,114 (3,699) 21,863
(Increase) decrease in net working capital (714) (551) 158 (1,107)
Investments in property, plant and equipment (1,936) (1,722) (84) (3,742)
Principal portion of lease liabilities paid (215) (112) (12) (339)
Investments in intangible assets (855) (52) 0 (907)
Treasury activities (860)
Taxes paid (3,620)
Free cash flow 11,288
2022
Operating profit – IFRS basis 16,766 4,149 (3,439) 17,476
Operating profit cash adjustments 5,768 1,702 102 7,572
Operating profit, net of operating cash adjustments 22,534 5,851 (3,337) 25,048
(Increase) decrease in net working capital (1,745) (706) 33 (2,418)
Investments in property, plant and equipment (1,744) (1,619) (86) (3,449)
Principal portion of lease liabilities paid (274) (118) (13) (405)
Investments in intangible assets (1,077) (26) 0 (1,103)
Treasury activities (530)
Taxes paid (4,102)
For the definition of free cash flow and a detailed breakdown see pages 176–178.
on the divisional free cash flow, although total Group free cash flow is unaffected. The comparative information for 2022 has been restated accordingly. Details are given
on page 45.
The free cash flows expressed in Swiss francs were heavily impacted by the appreciation of the Swiss franc against many
currencies. Both divisions reported a high level of cash generation; however, the level in the Diagnostics Division was lower due
to the decrease in the COVID-19-related products business. Net working capital increased in both divisions, although at lower
rate than in the prior year, and this had a positive impact on the growth of the operating free cash flow. There was also increased
capital expenditure in both divisions. Interest payments were higher, driven by the newly issued debt and higher short-term
interest rates, while tax payments were lower.
Net debt in millions of CHF
At 1 January 2023
Cash and cash equivalents 4,991
Marketable securities 4,776
Long-term debt (21,391)
Short-term debt (3,960)
Net debt at beginning of period (15,584)
Change in net debt during 2023

Dividend payments (7,926)
Transactions in own equity instruments (1,144)
Mergers and acquisitions, net of divestments of subsidiaries (6,242)
Hedging and collateral arrangements 155
Currency translation, fair value and other movements 754
Change in net debt (3,115)
At 31 December 2023
Cash and cash equivalents 5,376
Marketable securities 5,134
Long-term debt (24,809)
Short-term debt (4,400)
Net debt at end of period (18,699)
For the definition of net debt see page 180.
Net debt – currency profile in millions of CHF

Cash and marketable securities Debt
2023 2022 2023 2022
US dollar 1,583 1,284 (20,072) (18,707)
Euro 1,918 1,580 (3,489) (1,606)
Swiss franc 2,098 2,985 (5,101) (4,517)
Japanese yen 4,001 3,114 0 0
Other 910 804 (547) (521)
Total 10,510 9,767 (29,209) (25,351)
The net debt position of the Group at 31 December 2023 was CHF 18.7 billion, an increase of CHF 3.1 billion from 31 December 2022.
The increase was primarily due to the CHF 6.2 billion payment for the Telavant asset acquisition. The free cash flow of CHF 11.3 billion
covered the dividend payments of CHF 7.9 billion. The CHF 1.1 billion for transactions in own equity instruments related to purchases
in connection with the Group’s equity compensation plans.
Contractual obligations and commitments
The Group has obligations and commitments as set out in the table below. Carrying values are as shown in the consolidated
balance sheet. The potential obligations shown are not discounted and are not risk-adjusted, unless otherwise noted below.
Any amounts denominated in foreign currencies are translated into Swiss francs at the 31 December 2023 exchange rates.
Provisions for legal and environmental matters are not included as the timing and amount of any cash outflow is uncertain and
contingent on the development of the matters in question.
Contractual obligations and commitments as at 31 December 2023 in millions of CHF
Potential obligation
Less than 1–2 2–5 Over Carrying
1 year years years 5 years Total value
On-balance sheet
Debt 21
– Bonds and notes 4,616 4,038 11,326 15,251 35,231 27,812
– Other debt 1,397 0 0 0 1,397 1,397
Contingent consideration 20, 31 35 123 89 76 323 95
Accounts payable 17 4,325 0 0 0 4,325 4,325
Other non-current liabilities 18 0 504 481 723 1,708 1,541
Other current liabilities (including those associated with
assets held for sale) 19 12,087 55 39 0 12,181 12,158
Unfunded defined benefit plans 26 202 207 640 5,755 6,804 3,965
Total on-balance sheet commitments 22,662 4,927 12,575 21,805 61,969 51,293
Off-balance sheet
Capital commitments for property, plant and equipment 8 1,330 294 170 0 1,794 0
Leasing commitments 28 56 21 70 71 218 0
Contract manufacturing commitments 31 703 550 426 0 1,679 0
Alliance collaboration commitments 10 974 1,194 765 756 3,689 0
Total off-balance sheet commitments 3,063 2,059 1,431 827 7,380 0
Total contractual commitments 25,725 6,986 14,006 22,632 69,349 51,293
References are to the Notes in the Annual Financial Statements.

Debt. This consists mainly of bonds and notes and includes the principal and interest on the Group’s debt instruments. Other
debt is mainly commercial paper. The carrying values are discounted based on the interest rates inherent in the instruments.
Contingent consideration. This consists of potential payments arising from mergers and acquisitions. The carrying values are
risk-adjusted and discounted.
Unfunded defined benefit plans. These are mainly the pension plans in the Group’s German affiliates, where the fully reserved
pension obligations are used for self-financing of the local affiliates’ operations. The carrying values are discounted. Future
company contributions to the Group’s funded plans are not shown in the above table.
Capital commitments for property, plant and equipment. These are non-cancellable commitments for the purchase and
construction mainly at the Roche sites in Basel, Switzerland, South San Francisco, US, and Penzberg, Germany, and also at Chugai’s
new manufacturing sites in Japan.
Leasing commitments. These are the major non-cancellable commitments for signed lease agreements where the lease term
has not yet started. These mainly relate to the Genentech site in South San Francisco.
Contract manufacturing commitments. These are the future minimum take-or-pay commitments to purchase inventories
arising from the Group’s major long-term agreements with external Contract Manufacturing Organisations (CMOs).
Alliance collaboration commitments. These are potential upfront and milestone payments that may become due from the
Group’s in-licensing and alliance arrangements and intangible asset purchase agreements, including asset acquisitions.
Potential payments to alliance partners and for asset purchase agreements within the next three years are included assuming
all projects currently in development are successful. Potential payments beyond three years are only included for asset
purchase agreements.
Pensions and other post-employment benefits
Post-employment benefit plans are classified for IFRS Accounting Standards as ‘defined contribution plans’ if the Group pays
fixed contributions into a separate fund or to a third-party financial institution and will have no further legal or constructive
obligation to pay further contributions. In 2023 expenses for the Group’s defined contribution plans were CHF 469 million
(2022: CHF 452 million). All other plans are classified as ‘defined benefit plans’, even if the Group’s potential obligation is minor
or has a relatively remote possibility of arising. Plans are usually established as trusts which are independent of the Group and
are funded by payments from the Group and by employees, but in some cases the plan is unfunded and the Group pays pensions
to retired employees directly from its own financial resources. In 2023 expenses for the Group’s defined benefit plans were
CHF 603 million (2022: CHF 693 million).
Defined benefit plans
Funding status and balance sheet position

2023 2022
(CHF m) (CHF m)
Funded plans
– Fair value of plan assets 17,083 16,598
– Defined benefit obligation (15,495) (14,733)
Over (under) funding 1,588 1,865
Unfunded plans
– Defined benefit obligation (3,965) (4,001)
Total funding status (2,377) (2,136)
Limit on asset recognition (1,032) (1,526)

Reimbursement rights 49 58
Net recognised asset (liability) (3,360) (3,604)
Overall the funding status on an IFRS basis of the Group’s funded defined benefit plans decreased to 110% compared to 113%
at the start of the year. There was an increase in the defined benefit obligations following decreases in discount rates across
main regions. This was partly offset by an increase in the fair value of plan assets. The limit on asset recognition was lower
compared to the start of the year due to a smaller portion of the surplus of certain Swiss Pension plans being not recognisable
under IFRS. The funding status of the pension funds is monitored by the local pension fund governance bodies as well as being
closely reviewed at a Group level.
The unfunded plans are mainly those in the Group’s German affiliates, where the fully reserved pension obligations are invested
in the local affiliate’s operations. The defined benefit obligations for unfunded plans decreased as the increase coming from
lower discount rates was more than offset by the appreciation of the Swiss franc against the euro.
Full details of the Group’s pensions and other post-employment benefits are given in Note 26 to the Annual Financial
Statements.
Roche shares
Share price and market capitalisation (at 31 December)

% change
2023 2022 (CHF)
Share price (CHF) 261.40 358.40 –27
Non-voting equity security (Genussschein) price (CHF) 244.50 290.50 –16
Market capitalisation (billions of CHF) 197 239 –18
In 2023 Roche ranked number 13 among a peer group consisting of Roche and 15 other healthcare companies a) for Total
Shareholder Return (TSR), defined as share price growth plus dividends, measured in Swiss francs at actual exchange rates.
At constant exchange rates (CER) Roche ranked number 14, with the year-end return being minus 24.6% for Roche shares
and minus 12.8% for Roche non-voting equity securities. The combined performance of Roche shares and non-voting equity
securities was minus 14.4% compared to a weighted average return for the peer group of plus 3.7% in CHF terms and plus
11.6% at CER. The development of the Roche share price during 2023 was influenced by the negative news flow of 2022 on
the late-stage pipeline, an adverse impact from the appreciation of the Swiss franc and a decline in COVID-19-related sales.
Recently, there has been a convergence between Roche shares and Roche non-voting equity securities, lowering the price
difference compared to the start of the year.
In 2023, the healthcare sector experienced slower growth when compared to the global equity markets, which improved
performance as stronger-than-expected economic growth and a decrease in inflation mitigated recession fear. The
Swiss Market Index (SMI) experienced positive growth, although it slightly lagged behind major US indices. Roche shares and
non-voting equity securities underperformed the SMI.
a) Peer group for 2023: Abbott, AbbVie, Amgen, AstraZeneca, Bristol-Myers Squibb, Danaher, Eli Lilly, GlaxoSmithKline, Johnson & Johnson, Medtronic, Merck & Co.,
Novartis, Novo Nordisk, Pfizer, Roche and Sanofi.
Total Shareholder Return development
31 Dec. 22 31 Mar. 23 30 June 23 30 Sept. 23 31 Dec. 23
110
105
100
95
90
85
88
75
70
Roche share Roche non-voting equity security Peer Set Index
Source: Refinitiv Eikon. Data for Roche and the peer index has been re-based to 100 at 1 January 2023. The Peer Index was converted into Swiss francs at daily actual
exchange rates. Currency fluctuations have an influence on the representation of the relative performance of Roche versus the peer index.
Proposed dividend
The Board of Directors is proposing an increase of 1% in the dividend for 2023 to CHF 9.60 per share and non-voting equity
security (2022: CHF 9.50) for approval at the Annual General Meeting. This would be the 37th consecutive increase in the
dividend. If the dividend proposal is approved by shareholders, dividend payments on the total shares and non-voting equity
securities will amount to CHF 7.8 billion (2022: CHF 7.7 billion). This dividend proposal would result in a pay-out ratio (based on
core net income) of 51.7% (2022: 46.8%). Based on the prices at the end of 2023, the dividend yield on the Roche share was
3.7% (2022: 2.7%) and the yield on the non-voting equity security was 3.9% (2022: 3.3%). Further information on the Roche
securities is given on pages 181 to 183.
Information per share and non-voting equity security

2023 2022 % change
(CHF) (CHF) (CHF)
EPS – Basic 14.40 15.52 –7
EPS – Diluted 14.31 15.37 –7
Core EPS – Basic 18.69 20.49 –9
Core EPS – Diluted 18.57 20.30 –9
Equity attributable to Roche shareholders per share 36.77 35.03 +5
Dividend per share 9.60 9.50 +1
For further details please refer to Notes 22 and 29 of the Annual Financial Statements and page 176. The pay-out ratio is
calculated as dividend per share divided by core earnings per share.
Debt
Issuance of new debt
During 2023 the Group completed the following debt offerings:
∙ 27 February 2023: EUR 1,250 million of fixed rate bonds issued in two tranches with coupons between 3.204% and 3.355%
and maturing between August 2029 and February 2035.
∙ 13 November 2023: USD 5,200 million of fixed rate notes issued in four tranches with coupons between 5.265% and 5.593%
and maturing between November 2026 and November 2033.
∙ Also on 13 November 2023: USD 300 million of floating rate notes issued at a rate equal to the Secured Overnight Financing
Rate (SOFR) plus a margin of 0.74% and maturing in November 2026.
∙ 4 December 2023: EUR 1,500 million of fixed rate bonds issued in two tranches with coupons between 3.312% and 3.586%
and maturing between December 2027 and December 2036.
∙ 15 December 2023: CHF 560 million of fixed rate bonds issued in three tranches with coupons between 1.600% and 1.950%
and maturing between September 2028 and September 2038.
The Group received total aggregate net proceeds of CHF 8.2 billion from these issuances.
Redemption of debt
During 2023 the Group redeemed the following debt at the due date:
∙ 27 February 2023: notes with an outstanding amount of EUR 650 million and an effective interest rate of 0.63%.
∙ 29 August 2023: notes with an outstanding amount of GBP 76 million and an effective interest rate of 5.46%.
∙ 11 September 2023: notes with an outstanding amount of USD 750 million and an effective interest rate of 3.9%.
∙ 17 September 2023: notes with an outstanding amount of USD 390 million and an effective interest rate of 3.32%.
The combined cash outflow was CHF 1.8 billion and there was no gain or loss recorded on these redemptions.
Debt maturity
The maturity schedule of the Group’s bonds and notes outstanding at 31 December 2023 is shown in the table below.
Bonds and notes: nominal amounts at 31 December 2023 by contractual maturity

US dollar Euro Swiss franc Total a) Total a)
(USD m) (EUR m) (CHF m) (USD m) (CHF m)
2024 2,689 0 750 3,578 3,020
2025 2,256 1,000 500 3,955 3,338
2026 3,050 0 425 3,553 3,000
2027 2,100 600 825 3,741 3,158
2028 3,900 0 140 4,066 3,432
2029–2033 4,850 750 1,940 7,978 6,734
2034 and beyond 4,053 1,400 530 6,230 5,259
Total 22,898 3,750 5,110 33,101 27,941
a) Total translated at 31 December 2023 exchange rates.
The Group plans to meet its debt obligations using existing liquid funds as well as cash generated from business operations.
In 2023 the free cash flow was CHF 11.3 billion (2022: CHF 13.0 billion), which included the cash generated from operations as
well as the payment of interest and taxes.
For short-term financing requirements, the Group has a commercial paper program in the US under which it can issue up to
USD 7.5 billion of unsecured commercial paper notes and has committed credit lines of USD 7.5 billion available as back-stop
lines. On 19 January 2024 the Group executed a short-term bridge facility agreement of USD 5.0 billion. Commercial paper
notes totalling USD 1.0 billion were outstanding as of 31 December 2023 (31 December 2022: USD 1.9 billion). For longer-term
financing the Group maintains high long-term investment-grade credit ratings of AA by Standard & Poor’s, Aa2 by Moody’s and
AA by Fitch which should facilitate efficient access to international capital markets.
Further information on the Group’s debt is given in Note 21 to the Annual Financial Statements.
Financial risks
At 31 December 2023 the Group had a net debt position of CHF 18.7 billion (2022: CHF 15.6 billion). The financial assets of the
Group are managed in a conservative way with the objective to meet the Group’s financial obligations at all times.
Asset allocation. Liquid funds are either held as cash or are invested in high-quality, investment-grade fixed income securities
with an investment horizon to meet those liquidity requirements.
Cash and marketable securities

2023 2022
(CHF m) (% of total) (CHF m) (% of total)
Cash and cash equivalents 5,376 51 4,991 51
Money market instruments 4,621 44 4,192 43
Debt securities 512 5 583 6
Equity securities 1 0 1 0
Total cash and marketable securities 10,510 100 9,767 100
Credit risk. Credit risk arises from the possibility that counterparties to transactions may default on their obligations causing
financial losses for the Group. The rating profile of the Group’s CHF 10.5 billion of cash and fixed income marketable securities
remained high with 93% being invested in the A–AAA range. The Group has signed netting and collateral agreements with
the counterparties in order to mitigate counterparty risk on derivative positions. Bad debt expenses and overdue receivables
remained at a relatively low level.
Liquidity risk. Liquidity risk arises through a surplus of financial obligations over available financial assets due at any point
in time. The Group’s approach to liquidity risk is to maintain sufficient readily available reserves in order to meet its liquidity
requirements at any point in time. In addition to the current liquidity position, the Group has high cash generation ability. Those
future cash flows will be used to repay debt instruments in the coming years. Free cash flow was CHF 11.3 billion as compared
to CHF 13.0 billion in 2022.
The Roche Group continues to enjoy high long-term investment-grade credit ratings of AA by Standard & Poor’s, Aa2 by
Moody’s and AA by Fitch. At the same time Roche is rated at the highest available short-term ratings by those agencies. In the
event of financing requirements, the credit ratings of the Roche Group should permit efficient access to international capital
markets, including the commercial paper market. The Group has committed credit lines with various financial institutions
totalling USD 7.5 billion available as back-stop lines for the commercial paper program. As at 31 December 2023 no debt
has been drawn under these credit lines. On 19 January 2024 the Group executed a short-term bridge facility agreement of
USD 5.0 billion.
Market risk. Market risk arises from changing market prices of the Group’s financial assets or financial liabilities. The exposures
are predominantly related to changes in interest rates, foreign exchange rates and equity prices. The Group uses Value-at-Risk (VaR)
to assess the impact of market risk on its financial instruments. VaR data indicates the value range within which a given financial
instrument will fluctuate with a preset probability as a result of movements in market prices. The Group’s VaR has increased
since 31 December 2022 reflecting bond issuances during 2023.
Interest rate risk. Interest rate risk arises from movements in interest rates which could affect the Group’s financial result or the
value of the Group equity. The Group may use interest rate derivatives to manage its interest rate-related exposure and financial
result.
Further information on financial risk management and financial risks and the VaR methodology is included in Note 31 to the
Annual Financial Statements.
International Financial Reporting Standards
The Roche Group has been using International Financial Reporting Standards (IFRS Accounting Standards) to report its
consolidated results since 1990.
New and revised standards applied in 2023
In 2023 the Group implemented various minor amendments to existing standards and interpretations which have no material
impact on the Group’s overall results and financial position.
See Note 34 to the Annual Financial Statements for further details.
Presentational and cost allocation changes
This has been done to improve external comparability and to reflect changes in the internal reporting for functions with global
accountability.
∙ The income statement now presents ‘Selling, general and administration’ costs, which is created from merging ‘Marketing and
distribution’ costs and ‘General and administration’ costs.
∙ The income statement now presents ‘Other revenue’ in place of ‘Royalties and other operating income’.
∙ The income statement now presents ‘Other operating income (expense)’ for non-revenue income and for expenses that do not
fall into the regular functional costs.
∙ Allocations from functions with global accountability such as informatics, human resources and finance are no longer made to
the Pharmaceuticals and Diagnostics Divisions.
These changes have no impact on sales, operating profit, net income and earnings per share of the Group as a whole, for
both the IFRS and core basis. There is no change to the core results concept. The cost allocation changes will reduce costs
allocated to divisions and increase divisional margins by around 4.0 to 5.0 percentage points on a core basis, based on the
shape of the business at 1 January 2023. These changes have a consequential impact on the divisional free cash flow, although
total Group free cash flow is unaffected.
Comparative information for 2022 has been restated. A reconciliation to the previously published results is provided in Note 34
to the Annual Financial Statements and on pages 172 to 176 for the core results.
Presentational changes to be applied in 2024
In October 2023 the Group announced that, effective 1 January 2024, the Foundation Medicine business will be moved
under the responsibility of the Diagnostics Division from the Pharmaceuticals Division, while retaining Foundation Medicine’s
independence in this new reporting set-up. Accordingly from 1 January 2024 the results of the Foundation Medicine business
will be reported as part of the Diagnostics Division, and this represents a change for the Group’s operating segments in its
financial reporting. These changes will have no impact on sales, operating profit, net income and earnings per share of the
Group as a whole, for both the IFRS and core basis. There is no change to the core results concept.
No restatements have been made in the 2023 Annual Financial Statements for these changes. The changes will be applied
retrospectively from 1 January 2024, and accordingly the 2023 results will be restated in the Interim and Annual Financial
Statements in 2024.
When these restatements are made Foundation Medicine sales of CHF 347 million in 2023 will be restated from the
Pharmaceuticals Division to the Diagnostics Division. The restated core operating profit margin for 2023 of the Pharmaceuticals
Division will increase by 0.9 percentage points to 45.7%, while the corresponding margin of the Diagnostics Division will
decrease by 2.2 percentage points to 16.7%.
46 Roche Group | Roche Group Consolidated Financial Statements Finance Report 2023
Roche Group
Consolidated Financial Statements
Roche Group consolidated income statement for the year ended 31 December 2023 in millions of CHF

Sales 2, 3 44,612 14,104 – 58,716
Other revenue 2, 3 1,667 58 – 1,725
Revenue 2, 3 46,279 14,162 – 60,441
Cost of sales (9,083) (7,274) – (16,357)

Research and development 2 (12,352) (1,848) – (14,200)
Selling, general and administration (7,945) (3,042) (3,894) (14,881)
Other operating income (expense) 233 173 (14) 392
Operating profit 2 17,132 2,171 (3,908) 15,395
Financing costs 4 (996)

Other financial income (expense) 4 (320)
Profit before taxes 14,079
Income taxes 5 (1,721)

Net income 12,358
Attributable to
– Roche shareholders 22 11,498
– Non-controlling interests 24 860
Earnings per share and non-voting equity security 29

Basic (CHF) 14.40
Diluted (CHF) 14.31
Finance Report 2023 Roche Group Consolidated Financial Statements | Roche Group 47
Roche Group consolidated income statement for the year ended 31 December 2022 (restated) a) in millions of CHF

Sales 2, 3 45,551 17,730 – 63,281
Other revenue 2, 3 2,465 68 – 2,533
Revenue 2, 3 48,016 17,798 – 65,814
Cost of sales (11,040) (8,697) – (19,737)

Research and development 2 (13,384) (1,841) – (15,225)
Selling, general and administration (7,598) (3,170) (3,433) (14,201)
Other operating income (expense) 772 59 (6) 825
Operating profit 2 16,766 4,149 (3,439) 17,476
Financing costs 4 (665)

Other financial income (expense) 4 (484)
Profit before taxes 16,327
Income taxes 5 (2,796)

Net income 13,531
Attributable to
– Roche shareholders 22 12,421
– Non-controlling interests 24 1,110
Earnings per share and non-voting equity security 29

Basic (CHF) 15.52
Diluted (CHF) 15.37
a) Effective 1 January 2023, the Group has made certain presentational and cost allocation changes to the income statement. The information for 2022 has been restated
accordingly. Details and a reconciliation to the previously published income statement are disclosed in Note 34.
Roche Group consolidated statement of comprehensive income in millions of CHF

Year ended 31 December
2023 2022
Net income recognised in income statement 12,358 13,531
Other comprehensive income (OCI)

Remeasurements of defined benefit plans 22 (123) 546
Fair value changes on equity investments at fair value through OCI 22 (64) 30
Items that will never be reclassified to the income statement (187) 576
Fair value changes on debt securities at fair value through OCI 22 13 (33)
Cash flow hedges 22 (12) (62)
Currency translation of foreign operations 22 (2,644) (1,703)
Items that are or may be reclassified to the income statement (2,643) (1,798)
Other comprehensive income, net of tax (2,830) (1,222)
Total comprehensive income 9,528 12,309
Attributable to
– Roche shareholders 22 9,272 11,738
– Non-controlling interests 24 256 571
Total 9,528 12,309
Roche Group consolidated balance sheet in millions of CHF
31 December 2023 31 December 2022 31 December 2021

Non-current assets
Property, plant and equipment 8 21,724 23,075 23,163
Right-of-use assets 28 1,215 1,133 1,249
Goodwill 9 9,390 10,820 10,809
Intangible assets 10 14,828 9,685 12,117
Deferred tax assets 5 6,882 6,427 5,583
Defined benefit plan assets 26 1,019 957 1,498
Other non-current assets 15 1,964 2,238 2,271
Total non-current assets 57,022 54,335 56,690
Current assets
Inventories 11 7,749 8,605 7,715
Accounts receivable 12 11,021 11,606 10,806
Current income tax assets 5 344 313 320
Other current assets 16 3,130 3,525 3,755
Marketable securities 13 5,134 4,776 6,181
Cash and cash equivalents 14 5,376 4,991 6,850
Assets held for sale 6 692 0 0
Total current assets 33,446 33,816 35,627
Total assets 90,468 88,151 92,317
Non-current liabilities
Long-term debt 21 (24,809) (21,391) (16,076)
Deferred tax liabilities 5 (593) (645) (628)
Defined benefit plan liabilities 26 (4,379) (4,561) (6,103)
Provisions 20 (1,059) (1,111) (1,442)
Other non-current liabilities 18 (1,541) (1,189) (1,307)
Total non-current liabilities (32,381) (28,897) (25,556)
Current liabilities
Short-term debt 21 (4,400) (3,960) (15,122)
Current income tax liabilities 5 (2,257) (3,187) (3,002)
Provisions 20 (1,684) (2,248) (2,526)
Accounts payable 17 (4,325) (4,556) (4,637)
Other current liabilities 19 (12,150) (13,288) (13,129)
Liabilities directly associated with assets held for sale 6 (8) 0 0
Total current liabilities (24,824) (27,239) (38,416)
Total liabilities (57,205) (56,136) (63,972)
Total net assets 33,263 32,015 28,345
Equity
Capital and reserves attributable to Roche shareholders 22 29,315 27,992 24,489
Equity attributable to non-controlling interests 24 3,948 4,023 3,856
Total equity 33,263 32,015 28,345
Roche Group consolidated statement of cash flows in millions of CHF

2023 2022
(restated) a)
Cash flows from operating activities
Cash generated from operations 30 22,617 26,030
(Increase) decrease in net working capital (1,107) (2,418)
Payments made for defined benefit plans 26 (743) (655)
Utilisation of provisions 20 (1,052) (1,052)
Other operating cash flows 0 0
Income taxes paid 5 (3,620) (4,102)
Total cash flows from operating activities 16,095 17,803
Cash flows from investing activities

Purchase of property, plant and equipment (3,742) (3,449)
Purchase of intangible assets (907) (1,103)
Disposal of property, plant and equipment 173 82
Disposal of intangible assets 0 0
Disposal of products 558 612
Business combinations 6 0 0
Asset acquisitions 6 (6,220) (245)
Divestment of subsidiaries 1 1
Interest received (paid) and dividends received on marketable securities and other investments 30 168 32
Sales of equity securities and debt securities 125 148
Purchases of equity securities and debt securities (87) (271)
Sales (purchases) of money market instruments and time accounts over three months, net (745) 1,250
Other investing cash flows 33 19
Total cash flows from investing activities (10,643) (2,924)
Cash flows from financing activities

Proceeds from issue of bonds and notes 21 8,167 8,442
Redemption and repurchase of bonds and notes 21 (1,751) (1,750)
Increase (decrease) in commercial paper 21 (806) 1,293
Increase (decrease) in other debt 21 175 (13,683)
Hedging and collateral arrangements 155 (526)
Interest paid (770) (557)
Principal portion of lease liabilities paid 30 (339) (405)
Dividends paid 30 (7,926) (7,832)
Equity-settled equity compensation plans, net of transactions in own equity 27 (1,144) (1,257)
Other financing cash flows 0 0
Total cash flows from financing activities (4,239) (16,275)
Net effect of currency translation on cash and cash equivalents (828) (463)
Increase (decrease) in cash and cash equivalents 385 (1,859)
Cash and cash equivalents at 1 January 4,991 6,850

Cash and cash equivalents at 31 December 14 5,376 4,991
a) Effective 1 January 2023, certain line items in the statement of cash flows for 2022 have been reclassified following certain presentational changes the Group made.
Details and a reconciliation to the previously published statement of cash flows are disclosed in Note 34.
Roche Group consolidated statement of changes in equity in millions of CHF
Non-
Share Retained Fair value Hedging Translation controlling Total
capital earnings reserves reserves reserves Total interests equity
Year ended 31 December 2022
At 1 January 2022 160 34,161 (60) (60) (9,712) 24,489 3,856 28,345
Net income recognised in income statement – 12,421 – – – 12,421 1,110 13,531

Net change in fair value – financial assets at
fair value through OCI – 0 (2) – – (2) (1) (3)
Cash flow hedges – – – (37) – (37) (25) (62)
Currency translation of foreign operations – – 3 5 (1,189) (1,181) (522) (1,703)
Remeasurements of defined benefit plans – 537 – – – 537 9 546
Total comprehensive income – 12,958 1 (32) (1,189) 11,738 571 12,309
Dividends – (7,446) – – – (7,446) (406) (7,852)

Share capital reduction 22 (53) 53 – – – – – –
Equity compensation plans, net of transactions
in own equity – (786) – – – (786) (1) (787)
Changes in non-controlling interests 24 – (3) – – – (3) 3 –
At 31 December 2022 107 38,937 (59) (92) (10,901) 27,992 4,023 32,015

At 1 January 2023 107 38,937 (59) (92) (10,901) 27,992 4,023 32,015
Net income recognised in income statement – 11,498 – – – 11,498 860 12,358

Net change in fair value – financial assets at
fair value through OCI – (11) (40) – – (51) 0 (51)
Cash flow hedges – – – (7) – (7) (5) (12)
Currency translation of foreign operations – – 2 9 (2,051) (2,040) (604) (2,644)
Remeasurements of defined benefit plans – (128) – – – (128) 5 (123)
Total comprehensive income – 11,359 (38) 2 (2,051) 9,272 256 9,528
Dividends – (7,590) – – – (7,590) (334) (7,924)

Equity compensation plans, net of transactions
in own equity – (358) – – – (358) 2 (356)
Changes in non-controlling interests 24 – (1) – – – (1) 1 –
At 31 December 2023 107 42,347 (97) (90) (12,952) 29,315 3,948 33,263
52 Roche Group | Notes to the Roche Group Consolidated Financial Statements Finance Report 2023
Notes to the Roche Group

Consolidated Financial Statements
1. General accounting principles
Basis of preparation
The consolidated financial statements (hereafter ‘the Annual Financial Statements’) of the Roche Group have been prepared
in accordance with International Financial Reporting Standards (IFRS Accounting Standards) and comply with Swiss law. They
have been prepared using the historical cost convention except for items that are required to be accounted for at fair value.
They were approved for issue by the Board of Directors on 29 January 2024 and are subject to approval by the Annual General
Meeting of shareholders on 12 March 2024.
These financial statements are the Annual Financial Statements of Roche Holding Ltd, a company registered in Switzerland, and
its subsidiaries (‘the Group’).
A list of the accounting policies adopted by the Group in the preparation of the Annual Financial Statements and the changes in
accounting policies in 2023 are provided in Note 34.
Key accounting judgements, estimates and assumptions
The preparation of the Annual Financial Statements requires management to make judgements, estimates and assumptions that
affect the reported amounts of revenues, expenses, assets, liabilities and contingent amounts. Actual outcomes could differ
from those management estimates. The estimates and underlying assumptions are reviewed on an ongoing basis and are based
on historical experience and various other factors. Revisions to estimates are recognised in the period in which the estimate is
revised. The following are considered to be the key accounting judgements, estimates and assumptions made and are believed
to be appropriate based upon currently available information.
Revenue. The nature of the Group’s business is such that many sales transactions do not have a simple structure and may consist
of various performance obligations that are satisfied at different times. Contracts entered into in the Diagnostics Division typically
include performance obligations for instruments (including those provided under leasing arrangements), reagents and other
consumables, and services. Instruments may be sold in cash sales transactions at discounted prices. Where instruments are
provided under operating lease arrangements, some or the entire lease revenue may be variable and subject to subsequent
reagents sales. Major sources of estimation uncertainty are related to measurement of sales, net of discounts, for the related
obligations, including their stand-alone selling prices. It requires judgement to determine when different obligations are satisfied,
including whether enforceable purchase commitments for further obligations exist and when they arise. Out-licensing agreements
may be entered into with no further obligation or may include commitments to conduct research, late-stage development,
regulatory approval, co-marketing or manufacturing. These may be settled by a combination of upfront payments, milestone
payments, other licensing fees, and reimbursements for services provided. Whether to consider these commitments as a single
performance obligation or separate ones, or even being in scope of IFRS 15 ‘Revenues from Contracts with Customers’, is not
straightforward and requires some judgement. Depending on the conclusion, this may result in all revenue being calculated at
inception and either being recognised at once or spread over the term of a longer performance obligation.
Major sources of estimation uncertainty are related to the measurement of sales, which are recorded net of allowances for
estimated rebates, chargebacks, cash discounts and estimates of product returns, all of which are established at the time
of sale. All product sales allowances are based on estimates of the amounts earned or to be claimed on the related sales.
At 31 December 2023 the Group had CHF 4,804 million in provisions and accruals for expected sales returns, chargebacks
and other rebates, including Medicaid in the US and similar rebates in other countries (2022: CHF 4,767 million). The provisions
and accruals relating to the US pharmaceuticals business amounted to CHF 2,044 million (2022: CHF 2,120 million), of which
CHF 422 million (2022: CHF 510 million) were associated with expected sales returns. These estimates take into consideration
historical experience, current contractual and statutory requirements, specific known market events and trends such as
competitive pricing and new product introductions, estimated inventory levels, and the shelf life of products. If actual future
results vary, these estimates need to be adjusted, with an effect on sales and earnings in the period of the adjustment.
Finance Report 2023 Notes to the Roche Group Consolidated Financial Statements | Roche Group 53
Business combinations. The Group initially recognises the fair value of identifiable assets acquired, the liabilities assumed,
any non-controlling interest and the consideration transferred in a business combination. Management judgement is particularly
involved in the assessment of whether or not the net assets acquired constitute a business and in the recognition and fair
value measurement of intellectual property, inventories, contingent liabilities and contingent consideration. In making this
assessment, management applies judgement in considering the underlying economic substance of the items concerned in
addition to the contractual terms. When considered appropriate as a result from its judgement, management also applies
the optional ‘concentration test’ as set out in IFRS 3 ‘Business Combinations’ to aid the assessment of whether a transaction
represents a business combination or is simply in substance the purchase of a single asset or group of similar assets.
Impairment of property, plant and equipment, right-of-use assets, goodwill and intangible assets. At 31 December 2023 the
Group had CHF 21,724 million in property, plant and equipment (see Note 8), CHF 1,215 million in right-of-use assets (see Note 28),
CHF 9,390 million in goodwill (see Note 9) and CHF 14,828 million in intangible assets (see Note 10). Goodwill and intangible
assets not yet available for use are reviewed annually for impairment. Property, plant and equipment, right-of-use assets and
intangible assets in use are assessed for impairment when there is a triggering event that provides evidence that an asset may
be impaired. To assess whether any impairment exists, estimates of expected future cash flows are used. Actual outcomes
could vary significantly from such estimates. Other estimates relate to factors such as changes in discount rates, the planned
use of buildings, machinery or equipment or closure of facilities, the presence of competition, technical obsolescence and
lower-than-anticipated product sales, which could lead to shorter useful lives or impairment.
Impairment of financial assets. At 31 December 2023 the Group had CHF 440 million in allowance for doubtful accounts for
trade and lease receivables (see Note 12). Key estimates for the allowance for doubtful accounts are mainly related to risk of
default and expected loss rates. For making these estimates, inputs selected to calculate the allowance for doubtful accounts
are based on the company’s past experience, existing market conditions as well as forward-looking estimates at the end of each
reporting period.
Pensions and other post-employment benefits. The Group operates a number of defined benefit plans, and the fair values of
the recognised plan assets and liabilities are based upon statistical and actuarial calculations. Key estimates are required for
the measurement of the net defined benefit obligation, which is particularly sensitive to changes in the discount rate, inflation
rate, expected mortality and medical cost trend rate assumptions. At 31 December 2023 the present value of the Group’s
defined benefit obligation was CHF 19,460 million (see Note 26). The actuarial assumptions used for those estimates may differ
materially from actual results due to changes in market and economic conditions, longer or shorter lifespans of participants,
and other changes in the factors being assessed. These differences could impact the defined benefit plan assets and liabilities
recognised in the balance sheet in future periods.
Legal provisions. The Group provides for anticipated legal settlement costs when there is a probable outflow of resources
that can be reliably estimated. Where no reliable estimate can be made, no provision is recorded and contingent liabilities are
disclosed where material. At 31 December 2023 the Group had CHF 126 million in legal provisions. The status of significant
legal cases is disclosed in Note 20. These estimates consider the specific circumstances of each legal case, relevant legal
advice and are inherently uncertain due to the highly complex nature of legal cases. The estimates could change substantially
over time as new facts emerge and each legal case progresses.
Environmental provisions. The Group provides for anticipated environmental remediation costs when there is a probable
outflow of resources that can be reasonably estimated. At 31 December 2023 the Group had CHF 361 million in environmental
provisions (see Note 20). Environmental provisions consist primarily of costs to fully clean and refurbish contaminated sites,
including landfills, and to treat and contain contamination at certain other sites. These estimates are inherently uncertain as
assumptions are required related to the detection of previously unknown contamination, the method and extent of remediation,
the percentage of the problematic materials attributable to the Group at the remediation sites, and the financial capabilities
of other potentially responsible parties. The estimates could change substantially over time as new facts emerge and each
environmental remediation progresses.
Contingent consideration provisions. The Group makes provision for the estimated fair value of contingent consideration
arrangements arising from business combinations. At 31 December 2023 the Group had CHF 95 million in contingent
consideration provisions (see Note 20) and the total potential payments under contingent consideration arrangements from
business combinations could be up to CHF 323 million (see Note 31). Key estimates are required to determine the amounts
of the expected payments to be provided for, by considering the possible scenarios of forecast sales and other performance
criteria, the amount to be paid under each scenario, and the probability of each scenario, which is then discounted to a
net present value. These estimates could change substantially over time as new facts emerge and each scenario develops.
Income taxes. At 31 December 2023 the Group had a current income tax net liability of CHF 1,913 million and a deferred tax
net asset of CHF 6,289 million (see Note 5). Major sources of estimation uncertainty are related to the calculation of current
and deferred tax assets and liabilities. Some of these estimates are based on interpretations of existing tax laws or regulations.
Where tax positions are uncertain, accruals are recorded within income tax liabilities for management’s best estimate of the
ultimate liability that is expected to arise based on the specific circumstances and the Group’s historical experience. Factors
that may have an impact on the estimates of current and deferred tax balances include changes in tax laws, regulations or
rates, changing interpretations of existing tax laws or regulations, future levels of research and development spending and
changes in pre-tax earnings.
Leases. Where the Group is the lessee, key judgements include assessing whether arrangements contain a lease and
determining the lease term. To assess whether a contract contains a lease requires judgement about whether it depends on
a specified asset, whether the Group obtains substantially all the economic benefits from the use of that asset, and whether
the Group has a right to direct the use of the asset. In order to determine the lease term, judgement is required as extension
and termination options have to be assessed along with all facts and circumstances that may create an economic incentive
to exercise an extension option, or not exercise a termination option. Estimates include calculating the discount rate which is
based on the incremental borrowing rate. At 31 December 2023 the Group had CHF 1,215 million in right-of-use assets and
CHF 1,573 million in lease liabilities (see Note 28).
Where the Group is the lessor, the treatment of leasing transactions is mainly determined by whether the lease is considered
to be an operating or finance lease, which requires judgement. In making this assessment, management looks at the substance
of the lease, as well as the legal form, and makes a judgement about whether substantially all of the risks and rewards of
ownership are transferred. Arrangements which do not take the legal form of a lease but that nevertheless convey the right to
use an asset are also covered by such judgemental assessments.
Consolidation. The Group periodically undertakes transactions that may involve obtaining control or significant influence over
other companies. These transactions include equity acquisitions, asset purchases and alliance agreements. In all such cases
it requires judgement for management to make an assessment as to whether the Group has control or significant influence over
the other company, and whether it should be consolidated as a subsidiary or accounted for as an associated company. In making
this judgemental assessment, management considers the underlying economic substance of the transaction in addition to the
contractual terms.
2. Operating segment information
The Group has two divisions, Pharmaceuticals and Diagnostics. Revenues are primarily generated from the sale of prescription
pharmaceutical products and diagnostic instruments, reagents and consumables, respectively. Both divisions also derive
revenues from the sale or licensing of products or technology to third parties. Residual operating activities from divested
businesses and certain global activities are reported as ‘Corporate’. These include the Corporate Executive Committee and
global Group functions for informatics, communications, human resources, finance (including treasury and taxation), legal,
safety and environmental services. Subdivisional information is also presented for the Roche Pharmaceuticals and Chugai
operating segments within the Pharmaceuticals Division.
Divisional information in millions of CHF

2023 2022 2023 2022 2023 2022 2023 2022
Revenue from external customers
Sales 44,612 45,551 14,104 17,730 – – 58,716 63,281
Other revenue 1,667 2,465 58 68 – – 1,725 2,533
Total 46,279 48,016 14,162 17,798 – – 60,441 65,814
Revenue from other operating segments

Sales – – 15 21 – – 15 21
Other revenue – – – – – – – –
Elimination of interdivisional revenue (15) (21)
Total – – 15 21 – – – –
Segment results
Operating profit 17,132 16,766 2,171 4,149 (3,908) (3,439) 15,395 17,476
Capital expenditure
Business combinations 0 0 0 0 – – 0 0
Asset acquisitions 6,219 240 0 51 – – 6,219 291
Additions to property, plant and equipment 1,970 1,694 1,716 1,622 84 86 3,770 3,402
Additions to right-of-use assets 681 218 214 114 4 6 899 338
Additions to intangible assets 963 918 53 26 – – 1,016 944
Total 9,833 3,070 1,983 1,813 88 92 11,904 4,975
Research and development

Research and development costs 12,352 13,384 1,848 1,841 – – 14,200 15,225
Other segment information

Depreciation of property, plant and equipment 1,263 1,381 1,095 1,128 65 56 2,423 2,565
Depreciation of right-of-use assets 197 211 116 117 12 13 325 341
Amortisation of intangible assets 554 764 162 174 – – 716 938
Impairment (reversal) of property, plant and
equipment 277 108 73 15 0 0 350 123
Impairment (reversal) of right-of-use assets 319 5 0 0 0 0 319 5
Impairment of goodwill 591 0 0 0 – – 591 0
Impairment of intangible assets 589 2,837 19 0 – – 608 2,837
Equity compensation plan expenses 634 560 113 102 83 76 830 738
restated accordingly. Details and a reconciliation to the previously published income statement are disclosed in Note 34.
Pharmaceuticals subdivisional information in millions of CHF

Roche Pharmaceuticals Chugai Pharmaceuticals Division
2023 2022 2023 2022 2023 2022
Revenue from external customers
Sales 40,867 40,602 3,745 4,949 44,612 45,551
Other revenue 1,577 1,710 90 755 1,667 2,465
Total 42,444 42,312 3,835 5,704 46,279 48,016
Revenue from other operating segments

Sales 1,943 3,384 2,490 2,602 4,433 5,986
Other revenue 43 47 878 964 921 1,011
Elimination of income within division (5,354) (6,997)
Total 1,986 3,431 3,368 3,566 – –
Segment results
Elimination of results within division 349 (497)
Capital expenditure
Business combinations 0 0 0 0 0 0
Asset acquisitions 6,219 240 0 0 6,219 240
Additions to property, plant and equipment 1,532 1,245 438 449 1,970 1,694
Additions to right-of-use assets 630 168 51 50 681 218
Additions to intangible assets 962 885 1 33 963 918
Total 9,343 2,538 490 532 9,833 3,070

Research and development costs 11,258 12,331 1,114 1,096 12,372 13,427
Elimination of costs within division (20) (43)
Total 11,258 12,331 1,114 1,096 12,352 13,384
Other segment information

Depreciation of property, plant and equipment 1,108 1,209 155 172 1,263 1,381
Depreciation of right-of-use assets 166 177 31 34 197 211
Amortisation of intangible assets 544 749 10 15 554 764
Impairment (reversal) of property, plant and equipment 269 108 8 0 277 108
Impairment (reversal) of right-of-use assets 319 5 0 0 319 5
Impairment of goodwill 591 0 0 0 591 0
Impairment of intangible assets 569 2,837 20 0 589 2,837
Equity compensation plan expenses 632 557 2 3 634 560
Net assets in millions of CHF

Assets Liabilities Net assets
At 31 December 2023 2022 2021 2023 2022 2021 2023 2022 2021
Net operating assets
Pharmaceuticals 49,640 47,292 48,677 (13,134) (14,736) (15,262) 36,506 32,556 33,415
Diagnostics 20,484 21,593 21,459 (4,546) (5,075) (5,399) 15,938 16,518 16,060
Corporate 555 445 420 (884) (600) (618) (329) (155) (198)
Total 70,679 69,330 70,556 (18,564) (20,411) (21,279) 52,115 48,919 49,277
Current income tax net assets (liabilities) (1,913) (2,874) (2,682)

Deferred tax net assets (liabilities) 6,289 5,782 4,955
Defined benefit plan net assets (liabilities) (3,360) (3,604) (4,605)
Lease liabilities (1,573) (1,193) (1,354)
Marketable securities 5,134 4,776 6,181
Cash and cash equivalents 5,376 4,991 6,850
Debt (29,209) (25,351) (31,198)
Other net assets (liabilities) 404 569 921
Total net assets 33,263 32,015 28,345
Net operating assets – Pharmaceuticals subdivisional information in millions of CHF

Assets Liabilities Net assets
At 31 December 2023 2022 2021 2023 2022 2021 2023 2022 2021
Roche Pharmaceuticals 46,077 43,036 44,860 (13,269) (15,217) (15,808) 32,808 27,819 29,052
Chugai 6,589 8,890 7,892 (1,157) (1,910) (1,700) 5,432 6,980 6,192
Elimination within division (3,026) (4,634) (4,075) 1,292 2,391 2,246 (1,734) (2,243) (1,829)
Pharmaceuticals Division 49,640 47,292 48,677 (13,134) (14,736) (15,262) 36,506 32,556 33,415
Information by geographical area in millions of CHF
Revenue from external customers Non-current assets

Property, plant and Goodwill and
Sales Other revenue equipment Right-of-use assets intangible assets
2023
Switzerland 679 439 6,395 39 2,686
Germany 2,867 26 4,012 51 1,195
Rest of Europe 9,703 0 884 179 610
Europe 13,249 465 11,291 269 4,491
United States 27,183 1,169 6,135 663 19,611

Rest of North America 837 1 7 16 18
North America 28,020 1,170 6,142 679 19,629
Latin America 2,971 0 381 37 0
Japan 4,374 90 2,528 77 92

Rest of Asia 8,890 0 1,282 122 6
Asia 13,264 90 3,810 199 98
Africa, Australia and Oceania 1,212 0 100 31 0

Total 58,716 1,725 21,724 1,215 24,218
2022
Switzerland 683 432 6,394 47 2,535
Germany 3,295 23 4,032 28 1,262
Rest of Europe 10,326 0 913 194 741
Europe 14,304 455 11,339 269 4,538
United States 27,939 1,322 7,194 570 15,794

Rest of North America 1,101 1 15 16 20
North America 29,040 1,323 7,209 586 15,814
Latin America 2,870 0 322 42 4
Japan 5,695 755 2,697 91 138

Rest of Asia 9,852 0 1,410 105 11
Asia 15,547 755 4,107 196 149
Africa, Australia and Oceania 1,520 0 98 40 0

Total 63,281 2,533 23,075 1,133 20,505
Effective 1 January 2023, the Group has made certain presentational and cost allocation changes to the income statement. The comparative information for 2022 on other
revenue has been restated accordingly. Details and a reconciliation to the previously published income statement are disclosed in Note 34.
Sales are allocated to geographical areas by destination according to the location of the customer. Other revenue is allocated
according to the location of the Group company that receives the revenue.
Major customers
In total three US national wholesale distributors represent approximately a third of the Group’s sales in 2023 and in 2022. The
three US national wholesale distributors are McKesson Corp. with CHF 8 billion (2022: CHF 8 billion), Cencora, Inc. (formerly
AmerisourceBergen Corp.) with CHF 7 billion (2022: CHF 7 billion) and Cardinal Health, Inc. with CHF 4 billion (2022: CHF 4 billion).
Approximately 99% (2022: 97%) of these revenues were in the Roche Pharmaceuticals operating segment, with the residual in
the Diagnostics operating segment.
3. Revenue
Disaggregated revenue information
Disaggregation of revenue in millions of CHF
2023 2022
Revenue from Revenue from
contracts with Revenue from contracts with Revenue from
customers other sources Total customers other sources Total
Pharmaceuticals Division
Sales by therapeutic area
Oncology 19,087 – 19,087 19,995 – 19,995
Neuroscience 8,445 – 8,445 7,817 – 7,817
Immunology 6,242 – 6,242 7,181 – 7,181
Haemophilia A 4,147 – 4,147 3,823 – 3,823
Ophthalmology a) 2,865 – 2,865 1,651 – 1,651
Infectious diseases 1,056 – 1,056 2,161 – 2,161
Other therapeutic areas a) 2,770 – 2,770 2,923 – 2,923
Sales 44,612 – 44,612 45,551 – 45,551
Royalty income 551 284 835 663 261 924

Profit-share income 0 695 695 0 689 689
Other income from collaboration and out-licensing
agreements 124 0 124 842 0 842
Other 13 0 13 10 0 10
Other revenue 688 979 1,667 1,515 950 2,465
Diagnostics Division
Sales by customer area
Core Lab 7,210 540 7,750 7,170 605 7,775
Molecular Lab 2,121 99 2,220 3,339 111 3,450
Pathology Lab 1,296 92 1,388 1,229 89 1,318
Point of Care 1,349 30 1,379 3,557 32 3,589
Diabetes Care 1,365 2 1,367 1,595 3 1,598
Sales 13,341 763 14,104 16,890 840 17,730
Royalty income 43 0 43 42 19 61
Profit-share income 0 0 0 0 0 0
Other income from collaboration and out-licensing
agreements 2 0 2 0 0 0
Other 7 6 13 1 6 7
Other revenue 52 6 58 43 25 68
Total 58,693 1,748 60,441 63,999 1,815 65,814
a) In 2023 sales of the ‘Ophthalmology’ therapeutic area included sales of Luxturna. These were previously shown as part of ‘Other therapeutic areas’. The comparative
Revenue from other sources primarily relates to lease revenue and collaboration revenue for which the counterparty is not
considered a customer, such as income from profit-sharing agreements with collaboration partners.
Gross-to-net sales reconciliation for the Pharmaceuticals Division
The gross-to-net sales reconciliation for the Pharmaceuticals Division is shown in the table below. The companies in the
Diagnostics Division have similar reconciling items, but at much lower amounts.
Pharmaceuticals Division sales gross-to-net reconciliation in millions of CHF
2023 2022
Gross sales 57,298 56,799
Government and regulatory mandatory price reductions (6,762) (5,943)
Contractual price reductions (4,655) (4,108)
Cash discounts (311) (279)
Customer returns reserves (330) (366)
Others (628) (552)
Net sales 44,612 45,551
Government and regulatory mandatory price reductions. These consist of mandatory price reductions. The major elements
are the 340B Drug Discount Program, Medicaid and other plans in the US, which totalled USD 5.7 billion, equivalent to
CHF 5.2 billion (2022: USD 4.9 billion, equivalent to CHF 4.7 billion).
Contractual price reductions. These include rebates and chargebacks that are the result of contractual agreements that are
primarily volume based and performance based.
Cash discounts. These include credits offered to wholesalers for remitting payment on their purchases within contractually
defined incentive periods.
Customer returns reserves. These are allowances established for expected product returns.
Sales reductions that are expected to be withheld by the customer upon settlement, such as contractual price reductions and
cash discounts, are recorded in the balance sheet as a deduction from trade receivables (see Note 12). Sales reductions that
are separately payable to customers, governmental health authorities or healthcare regulatory authorities are recorded in
the balance sheet as accrued liabilities (see Note 19). Provisions for sales returns are recorded in the balance sheet as other
provisions (see Note 20).
Contract balances
Receivables in millions of CHF
2023 2022 2021

Accounts receivable 12 11,021 11,606 10,806
Other current receivables – contracts with customers 16 633 686 646
Other non-current receivables – contracts with customers 15 19 26 36
Total receivables 11,673 12,318 11,488
Other current receivables mainly include royalty and licensing receivables. At 31 December 2023 total receivables included
lease receivables of 2% (2022: 2%, 2021: 2%) which are not considered receivables from contracts with customers.
Contract assets in millions of CHF
2023 2022 2021

Accrued income and contract costs 168 208 763
Total contract assets 168 208 763
Contract liabilities in millions of CHF
2023 2022 2021

Deferred income – non-current 216 238 233
Deferred income – current 604 601 560
Total contract liabilities 820 839 793
Movement in contract liabilities in millions of CHF
2023 2022
At 1 January 839 793
Revenue recognised that was included in the contract liability balance at the beginning of the year (772) (585)
Increases due to cash received or receivable, excluding amounts recognised as revenue during the year 825 669
Currency translation effects (72) (38)
At 31 December 820 839
Revenue recognised in relation to performance obligations satisfied in previous years
In 2023 there was a decrease in revenue recognised of CHF 46 million (2022: increase in revenue of CHF 102 million) relating
to performance obligations that had been satisfied in previous periods, mainly due to adjustments of sales deduction provisions
and accruals for expected sales returns, chargebacks and other allowances in respect of previous years.
Remaining performance obligations in (partially) unsatisfied long-term contracts
Remaining performance obligations in (partially) unsatisfied long-term contracts are either included in deferred income or are
related to amounts the Group expects to receive for goods and services that have not yet been transferred to customers under
existing, non-cancellable or otherwise enforceable contracts. These are mainly associated with contracts in the Diagnostics
Division that have minimum purchase commitments related to reagents and consumables for previously sold instruments as well
as monitoring and maintenance services. For contracts that have an original duration of one year or less, the Group has elected
the practical expedient to not disclose the transaction price for remaining performance obligations at the end of each reporting
period and at which point in time the Group expects to recognise these sales.
Transaction price allocated to contracts with (partially) unsatisfied performance obligations in millions of CHF
2023 2022
No contract liability held 4,097 3,248
Contract liability held 820 839
Total 4,917 4,087
Thereof expected to be recognised as revenue

– Within one year 2,104 1,895
– Between one and five years 2,705 2,084
– More than five years 108 108
Total 4,917 4,087
4. Net financial expense
Financing costs in millions of CHF
2023 2022
Interest expense (797) (588)
Amortisation of debt discount 21 (8) (4)
Fair value loss on treasury locks designated as cash flow hedges – transferred from OCI (2) (2)
Net gains (losses) on debt derivatives 3 0
Net gains (losses) on redemption and repurchase of bonds and notes 21 0 0
Discount unwind, including effects from discount rate changes 20 (19) 27
Net interest cost of defined benefit plans 26 (150) (82)
Interest expense on lease liabilities 28 (23) (16)
Total financing costs (996) (665)
Other financial income (expense) in millions of CHF
2023 2022
Net gains (losses) on equity investments/securities at fair value through profit or loss 4 (79)
Net income (expense) from equity investments/securities 4 (79)
Interest income (expense) from debt securities at fair value through OCI and at amortised cost 195 40
Net gains (losses) on sale of debt securities at fair value through OCI 0 0
Net gains (losses) on debt investments/securities at fair value through profit or loss 2 (6)
Write-downs and impairments of debt securities (1) 0
Net interest income (expense) and income from debt investments/securities 196 34
Net foreign exchange gains (losses) (353) 230

Net gains (losses) on foreign currency derivatives 110 (508)
Foreign exchange gains (losses) (243) (278)
Gains (losses) on net monetary position in hyperinflationary economies (233) (70)
Net other financial income (expense) (12) (50)
Associates (32) (41)
Total other financial income (expense) (320) (484)

Net financial expense in millions of CHF
2023 2022
Financing costs (996) (665)
Other financial income (expense) (320) (484)
Net financial expense (1,316) (1,149)
Financial result from treasury management (1,134) (1,026)

Financial result from pension management (150) (82)
Associates (32) (41)
Net financial expense (1,316) (1,149)
Hyperinflationary economies
The Group has considered Argentina (since 1 July 2018) and Türkiye (since 1 April 2022) to be hyperinflationary economies in the
context of IAS 29 ‘Financial Reporting in Hyperinflationary Economies’. The cumulative inflation index exceeds 100% for Argentina
over the last three years as measured by the National Wholesale Price Index (Sistema de Índices de Precios Mayoristas) and for
Türkiye over the last two years as measured by the consumer price index published by the Turkish Statistical Institute.
Accordingly the Group has reviewed the reporting from its affiliates in Argentina and Türkiye, and where necessary restated them
in line with IAS 29. The potential adjustments resulting from the application of IAS 29 do not have a significant impact on the
Group’s operating results and balance sheet. An adjustment is recorded for the gains (losses) on the net monetary positions,
which is a loss of CHF 233 million resulting from the loss in purchasing power of the positive net monetary positions during
2023 of the Group’s affiliates in Argentina and Türkiye (2022: loss of CHF 70 million).
5. Income taxes
Income tax expenses in millions of CHF
2023 2022
Current income taxes (2,831) (4,454)
Deferred taxes 1,110 1,658
Total income tax (expense) (1,721) (2,796)
Since the Group operates internationally, it is subject to income taxes in many different tax jurisdictions. The Group calculates
its average expected tax rate as a weighted average of the tax rates in the tax jurisdictions in which the Group operates.
This rate changes from year to year due to changes in the mix of the Group’s taxable income and changes in local tax rates.
The Group’s average expected tax rate decreased to 17.8% in 2023 (2022: 18.7%). This was driven by the lower percentage of
profit contribution coming from tax jurisdictions with tax rates higher than the average Group tax rate. During 2023 there were
no significant changes to local tax rates in the tax jurisdictions in which the Group operates.
The Group’s effective tax rate decreased to 12.2% in 2023 (2022: 17.1%). This was mainly due to the higher effect from the
resolution of several tax disputes in 2023 compared to 2022 and the mix in the profit contribution mentioned above.
The Group’s effective tax rate can be reconciled to the Group’s average expected tax rate as follows:
Reconciliation of the Group’s effective tax rate
2023 2022
Average expected tax rate 17.8% 18.7%
Tax effect of
– Non-taxable income/non-deductible expenses +2.2% +1.8%
– Equity compensation plans +0.5% +0.4%
– Research and development tax credits and other deductions –3.9% –3.0%
– US state tax impacts +0.4% +0.5%
– Tax on unremitted earnings +0.2% +0.1%
– Resolution of several tax disputes –5.5% –1.9%
– Prior-year and other differences +0.5% +0.5%
Group’s effective tax rate 12.2% 17.1%
The income tax benefit recorded in respect of equity compensation plans, which varies according to the price of the underlying
equity, was CHF 77 million (2022: CHF 58 million). Had the income tax benefits been recorded solely on the basis of the IFRS 2
expense multiplied by the applicable tax rate, then a benefit of approximately CHF 145 million (2022: CHF 126 million) would
have been recorded.
Tax effects of other comprehensive income in millions of CHF
2023 2022
Pre-tax After-tax Pre-tax After-tax
amount Tax amount amount Tax amount
Remeasurements of defined benefit plans (164) 41 (123) 849 (303) 546
Equity investments at fair value through OCI (72) 8 (64) 28 2 30
Debt securities at fair value through OCI 13 0 13 (35) 2 (33)
Cash flow hedges (18) 6 (12) (90) 28 (62)
Currency translation of foreign operations (2,644) – (2,644) (1,703) – (1,703)
Other comprehensive income (2,885) 55 (2,830) (951) (271) (1,222)
Income tax assets (liabilities) in millions of CHF
2023 2022 2021

Current income taxes
– Assets 344 313 320
– Liabilities (2,257) (3,187) (3,002)
Net current income tax assets (liabilities) (1,913) (2,874) (2,682)
Deferred taxes
– Assets 6,882 6,427 5,583
– Liabilities (593) (645) (628)
Net deferred tax assets (liabilities) 6,289 5,782 4,955
Current income tax liabilities include accruals for uncertain tax positions.
Current income taxes: movements in recognised net assets (liabilities) in millions of CHF
2023 2022
Net current income tax asset (liability) at 1 January (2,874) (2,682)
Income taxes paid 3,620 4,102
(Charged) credited to the income statement (2,831) (4,454)
(Charged) credited to equity from equity compensation plans and other transactions with
shareholders 3 59
Currency translation effects and other movements 169 101
Net current income tax asset (liability) at 31 December (1,913) (2,874)
Deferred taxes: movements in recognised net assets (liabilities) in millions of CHF
Property, plant
and equipment Other
and right-of-use Intangible Defined t emporary
assets assets enefit plans
b differences Total
At 1 January 2022 (942) (448) 940 5,405 4,955
Asset acquisitions 6 0 0 0 6 6
(Charged) credited to the income statement (16) 1,624 128 (78) 1,658
(Charged) credited to other comprehensive income 22 – – (303) 32 (271)
(Charged) credited to equity from equity compensation plans
and other transactions with shareholders – – – (327) (327)
Currency translation effects and other movements 33 (62) (45) (165) (239)
At 31 December 2022 (925) 1,114 720 4,873 5,782

At 1 January 2023 (925) 1,114 720 4,873 5,782
Asset acquisitions 6 0 7 0 19 26
(Charged) credited to the income statement 2 1,181 (24) (49) 1,110
(Charged) credited to other comprehensive income 22 – – 41 14 55
(Charged) credited to equity from equity compensation plans
and other transactions with shareholders – – – (46) (46)
Currency translation effects and other movements 78 (183) (55) (478) (638)
At 31 December 2023 (845) 2,119 682 4,333 6,289
The net deferred tax assets for other temporary differences mainly relate to accrued and other liabilities, including lease
liabilities, provisions and unrealised profit in inventory.
Deferred tax assets are recognised for tax losses carried forward only to the extent that realisation of the related tax benefit is
probable. The Group has unrecognised tax losses, including valuation allowances, as follows:
Unrecognised tax losses: expiry
2023 2022
Amount Applicable Amount Applicable
(CHF million) tax rate (CHF million) tax rate
Within one year 558 12% 279 12%
Between one and five years 4,499 12% 3,433 12%
More than five years 6,650 6% 7,134 6%
Total unrecognised tax losses 11,707 9% 10,846 8%
The ‘More than five years’ category includes losses that cannot be used for US state income tax purposes in those states which
only permit tax reporting on a separate entity basis.
Deferred tax liabilities have not been established for the withholding tax and other taxes that would be payable on the remittance
of earnings of foreign subsidiaries, where such amounts are currently regarded as permanently reinvested for the purpose of
these financial statements. The total unremitted earnings of the Group, regarded as permanently reinvested for the purpose of
these financial statements, were CHF 26.4 billion at 31 December 2023 (2022: CHF 28.3 billion).
Pillar Two income taxes
The Organisation for Economic Co-operation and Development (OECD) has published Global Anti-Base Erosion (GloBE)
Model Rules, which include a minimum tax of 15% by jurisdiction (Pillar Two). Various countries intend to enact or have enacted
tax legislation to either fully or partially comply with Pillar Two.
The Group is within the scope of the OECD’s Pillar Two. The Group is in the process of assessing its exposure to Pillar Two,
which did not impact the 2023 results but will impact the results from 1 January 2024 onwards. On 22 December 2023 the
Swiss government decided to partially implement Pillar Two by introducing a Qualified Domestic Minimum Top-up Tax (QDMTT)
to reach the required taxation level of 15% on Pillar Two qualifying profits of subsidiaries in Switzerland effective from
1 January 2024. The Swiss government did not introduce the Income Inclusion Rule (IIR), which would require Switzerland to
levy taxes on Pillar Two qualifying profits of subsidiaries in other countries not reaching the 15%. Based on the assessment to
date and the shape of the business as at 1 January 2024, this global minimum tax regime is expected to increase the Group’s
tax rate in 2024.
6. Mergers and acquisitions
This note includes both transactions accounted for as business combinations and asset acquisitions. Asset acquisitions are
acquisitions of legal entities that do not qualify as business combinations under IFRS 3 and include those acquisitions where the
value in these acquired companies largely consists of the rights to a single asset, such as a product or technology, or to a group
of similar assets. Cash consideration paid for asset acquisitions at the transaction date and subsequent additional contingent
payments made upon the achievement of performance-related development milestones are included as a separate line in the
table ‘Cash flows from asset acquisitions’ as disclosed below. Subsequent consideration for performance-related development
milestones for transactions treated as asset acquisitions is recognised as intangible assets when the specific milestones have
been achieved and other recognition criteria are met.
Future business combinations
Carmot Therapeutics, Inc. On 26 January 2024 the Group acquired a 100% controlling interest in Carmot Therapeutics, Inc.
(‘Carmot’), a privately owned US company based in Berkeley, California. With the acquisition, the Group obtained access to
Carmot’s current research and development portfolio, which includes three clinical-stage product candidates to treat obesity
and diabetes, as well as a number of preclinical programmes. Carmot’s lead product candidate, CT-388, is a phase II-ready
dual GLP-1/GIP receptor agonist for the treatment of overweight and obese patients with comorbidities. Carmot will be reported in
the Pharmaceuticals Division. The purchase consideration was USD 2.9 billion in cash and up to USD 0.4 billion from a contingent
consideration arrangement. The contingent payments are based on the achievement of predetermined performance-related
milestones. Given the recent acquisition date, the initial accounting for this transaction has not been completed at the time
these Annual Financial Statements were approved for issue.
LumiraDx. On 29 December 2023 the Group announced the entry into a definitive agreement to acquire a 100% controlling
interest in selected subsidiaries of LumiraDx Limited (‘LumiraDx’), a company incorporated under the laws of the Cayman
Islands, as part of a pre-packaged UK administration sale. With the acquisition, the Group will obtain access to LumiraDx’s point-
of-care technology which combines multiple diagnostic modalities on a single platform. The transaction is subject to certain
conditions including antitrust and regulatory approvals. The closing of the transaction is currently expected to take place
by mid-2024. LumiraDx will be reported in the Diagnostics Division. The cash consideration to be paid at the acquisition date
will be USD 295 million (subject to customary closing adjustments) and an additional payment of up to USD 55 million for the
reimbursement of amounts to fund the point-of-care technology platform business until the closing of the acquisition.
Business combinations – 2023
The Group did not complete any business combinations in 2023.
Business combinations – 2022
The Group did not complete any business combinations in 2022.
Cash flows from business combinations
Business combinations: net cash outflows in millions of CHF

2023 2022
Pharmaceuticals Diagnostics Total Pharmaceuticals Diagnostics Total
Cash consideration paid 0 0 0 0 0 0
Deferred consideration paid 0 0 0 0 0 0
Contingent consideration paid 20 0 0 0 0 0 0
Cash in acquired company 0 0 0 0 0 0
Total net cash outflows 0 0 0 0 0 0
Asset acquisitions – 2023
Telavant Holdings, Inc. On 14 December 2023 the Group acquired a 100% controlling interest in Telavant Holdings, Inc.
(‘Telavant’), a US company owned by Roivant Sciences Ltd. (‘Roivant’) and Pfizer Inc. (‘Pfizer’) and based in New York. With the
acquisition, the Group obtained full rights to further develop and manufacture RVT-3101 and commercialise it in the US and
in Japan pending clinical and regulatory success. Outside of the US and Japan, Pfizer holds commercialisation rights. RVT-3101
is a phase III-ready novel TL1A-directed antibody for the treatment of inflammatory bowel disease, including ulcerative colitis and
Crohn’s disease, and potentially multiple other diseases. In addition, with the acquisition the Group obtained an option to enter
into a global collaboration with Pfizer on a next-generation p40/TL1A-directed bispecific antibody which is currently in phase I.
Telavant is reported in the Pharmaceuticals Division. The cash consideration paid at the acquisition date was USD 7.1 billion.
An additional contingent payment of USD 150 million may be made based on the achievement of a predetermined performance-
related near-term milestone.
Asset acquisitions – 2023: net assets acquired in millions of CHF
Telavant
Intangible assets
– Product intangibles: not available for use 10 6,193
– Product intangibles: in use 10 26
Deferred tax assets 5 26
Cash and cash equivalents 1
Other net assets (liabilities) (25)
Net identifiable assets 6,221
Total consideration 6,221
Cash 6,221
Total consideration 6,221
Asset acquisitions – 2022
Good Therapeutics, Inc. On 26 September 2022 the Group acquired a 100% controlling interest in Good Therapeutics, Inc.
(‘Good Therapeutics’), a privately owned US company based in Seattle, Washington. Good Therapeutics is reported in the
Pharmaceuticals Division. The cash consideration paid at the acquisition date was USD 197 million. Additional contingent
payments may be made based upon the achievement of performance-related milestones.
Asset acquisitions – 2022: net assets acquired in millions of CHF

Good
Therapeutics
Intangible assets
– Product intangibles: not available for use 240
Deferred tax assets 5 6
Cash and cash equivalents 0
Other net assets (liabilities) 0
Net identifiable assets 246
Fair value of previously held equity interest (52)
Total consideration 194
Cash 194
Total consideration 194
Cash flows from asset acquisitions
Asset acquisitions: net cash outflows in millions of CHF

2023 2022
Pharmaceuticals Diagnostics Total Pharmaceuticals Diagnostics Total
Cash consideration paid (6,221) 0 (6,221) (194) 0 (194)
Cash in acquired company 1 0 1 0 0 0
Contingent payments related to previous
acquisitions 0 0 0 0 (51) (51)
Total net cash outflows (6,220) 0 (6,220) (194) (51) (245)
For asset acquisitions previously closed, in 2023 the Group did not record any additions to product intangible assets related to
contingent payments for the achievement of performance-related milestones (2022: CHF 51 million).
Future divestments
In May 2023, the Group announced plans to exit its legacy Genentech manufacturing facility in Vacaville, California, as part
of a broader strategy to evolve its manufacturing capabilities in line with future pipeline requirements. As of 31 December 2023
the assets and certain liabilities directly associated with the Vacaville manufacturing plant were classified as held for sale,
as the Group is committed to a plan to sell, which is expected to be completed in 2024. This transaction is reported in the
Pharmaceuticals Division.
Assets held for sale and liabilities directly associated with assets held for sale in millions of CHF
2023 2022
Property, plant and equipment 8 684 0
Right-of-use assets 28 8 0
Assets held for sale 692 0
Lease liabilities 28 (8) 0

Liabilities directly associated with assets held for sale (8) 0
Net assets held for sale 684 0

7. Global restructuring plans
During 2023 the Group launched different productivity initiatives to reinvest in strategic areas and continued the
implementation of various global restructuring plans initiated in prior years.
Global restructuring plans: costs incurred in millions of CHF
2023 2022
Global restructuring costs
– Employee-related costs 577 127
– Site closure and other costs related to physical assets 925 323
– Divestment of products and businesses 0 0
– Other reorganisation expenses 536 519
Additional costs
– Impairment of goodwill 0 0
– Impairment of intangible assets 0 0
– Legal and environmental cases 0 (2)
Total costs 2,038 967
The Pharmaceuticals Division incurred restructuring costs of CHF 1,112 million (2022: CHF 788 million), with the major item
being an infrastructure strategy optimisation programme resulting in costs of CHF 554 million, primarily consisting of impairment
of right-of-use assets and property, plant and equipment at US sites. In addition, the manufacturing network strategy review
incurred site closure costs of CHF 269 million mainly related to sites in the US (2022: CHF 178 million related to sites in the US,
Switzerland and Germany). In 2022 the portfolio prioritisation programme incurred costs of CHF 221 million mainly related to
the closure of studies.
The Diagnostics Division incurred costs of CHF 437 million (2022: CHF 75 million) for manufacturing and supply chain optimisations,
research and development productivity initiatives and business transformations to drive organisational and commercial
effectiveness. These costs mainly included CHF 191 million for employee-related matters as well as CHF 71 million primarily
relating to impairments of property, plant and equipment at manufacturing sites and CHF 62 million of other reorganisation
expenses.
Corporate costs were CHF 489 million (2022: CHF 104 million) and included the business process transformation to simplify
the systems landscape and reduce process complexity. The transformation is a multi-year cross-divisional programme to drive
efficiency gains through system and process optimisation.
Global restructuring plans: summary of costs incurred in millions of CHF
2023 2022
Employee-related costs
– Termination costs 425 (38)
– Defined benefit plans (2) (15)
– Other employee-related costs 154 180
Total employee-related costs 577 127
Site closure costs

– Impairment (reversal) of property, plant and equipment and right-of-use assets 635 92
– Accelerated depreciation of property, plant and equipment and right-of-use assets 51 105
– (Gains) losses on disposal of property, plant and equipment and right-of-use assets (63) 2
– Other site closure costs 302 124
Total site closure and other costs related to physical assets 925 323
Divestment of products and businesses

– (Gains) losses on divestment of subsidiaries 0 0
– Other (gains) losses on divestment of products and businesses 0 0
Total costs on divestment of products and businesses 0 0
Other reorganisation expenses 536 519

Additional costs
– Impairment of goodwill 0 0
– Impairment of intangible assets 0 0
– Legal and environmental cases 0 (2)
Total costs 2,038 967

Global restructuring plans: classification of costs in millions of CHF
2023 2022
Depreciation, Depreciation,
amortisation amortisation
and impairment Other costs Total and impairment Other costs Total
Cost of sales
– Pharmaceuticals 56 260 316 145 106 251
– Diagnostics 68 164 232 13 31 44
– Diagnostics 0 75 75 0 (2) (2)
Selling, general and administration
– Diagnostics 3 121 124 0 34 34
– Corporate 0 490 490 0 105 105
Other operating income (expense)
– Pharmaceuticals 0 (80) (80) 0 13 13
– Diagnostics 0 6 6 0 (1) (1)
– Corporate 0 (1) (1) 0 (1) (1)
Total costs 686 1,352 2,038 197 770 967
Total by operating segment

– Roche Pharmaceuticals 611 470 1,081 162 577 739
– Chugai 4 27 31 22 27 49
– Diagnostics 71 366 437 13 62 75
– Corporate 0 489 489 0 104 104
Total costs 686 1,352 2,038 197 770 967
Effective 1 January 2023, the Group has made certain presentational and cost allocation changes to the income statement (see Note 34). The comparative information for
2022 has been restated accordingly.
8. Property, plant and equipment
Property, plant and equipment: movements in carrying value of assets in millions of CHF
Buildings
and land Machinery Construction
Land improvements and equipment in progress Total
At 1 January 2022
Cost 1,316 18,175 21,998 4,756 46,245
Accumulated depreciation and impairment 0 (8,289) (14,691) (102) (23,082)
Net book value 1,316 9,886 7,307 4,654 23,163

At 1 January 2022 1,316 9,886 7,307 4,654 23,163
Additions 2 125 946 2,329 3,402
Disposals (1) (6) (84) (3) (94)
Transfers (9) 1,925 1,127 (3,043) –
Reclassification to assets held for sale 6 0 0 0 0 0
Depreciation charge – (869) (1,696) – (2,565)
Impairment reversal (charge) 0 0 (35) (88) (123)
Other 0 (2) (59) (6) (67)
Currency translation effects (60) (178) (276) (127) (641)
At 31 December 2022 1,248 10,881 7,230 3,716 23,075
Cost 1,248 19,806 22,494 3,891 47,439

Net book value 1,248 10,881 7,230 3,716 23,075

At 1 January 2023 1,248 10,881 7,230 3,716 23,075
Additions 34 6 956 2,774 3,770
Disposals (32) (13) (75) (4) (124)
Transfers 1 737 612 (1,350) –
Reclassification to assets held for sale 6 (29) (433) (184) (38) (684)
Depreciation charge – (829) (1,594) – (2,423)
Impairment reversal (charge) (1) (207) (105) (37) (350)
Other 0 15 (62) (15) (62)
Currency translation effects (112) (629) (505) (232) (1,478)
At 31 December 2023 1,109 9,528 6,273 4,814 21,724
Cost 1,109 17,933 19,913 4,882 43,837

Net book value 1,109 9,528 6,273 4,814 21,724
Classification of impairment of property, plant and equipment in millions of CHF
2023 2022
Cost of sales (116) (119)
Research and development (32) (3)
Selling, general and administration (202) (1)
Other operating income (expense) 0 0
Total impairment reversal (charge) (350) (123)
In 2023 and 2022 impairments for property, plant and equipment were mainly related to global restructuring plans (see Note 7).
Included in the 2023 impairment charge was a full write-off of CHF 221 million for leasehold improvements and equipment
recorded by Foundation Medicine in relation to its leased buildings in Boston and San Diego, US. These valuations were determined
using a fair value less costs of disposal calculation and classified as a Level 3 fair value in the fair value hierarchy. A post-tax
discount rate of 3.5% was applied to the projected post-tax cash flows for the remaining contractual period of Foundation
Medicine’s lease agreements of approximately 8 to 15 years.
In 2023 reimbursements of CHF 3 million were received from insurance companies in respect of impairments to property, plant
and equipment (2022: none). In 2023 no borrowing costs were capitalised as property, plant and equipment (2022: none).
At 31 December 2023 buildings and land improvements as well as machinery and equipment with an original cost of
CHF 5.6 billion (2022: CHF 5.7 billion) and a net book value of CHF 1.6 billion (2022: CHF 1.6 billion) were being leased to third
parties (see Note 28).
Capital commitments
The Group has non-cancellable capital commitments for the purchase or construction of property, plant and equipment
totalling CHF 1.8 billion (2022: CHF 2.6 billion).
9. Goodwill
Goodwill: movements in carrying value of assets in millions of CHF
2023 2022
At 1 January
Cost 14,942 14,900
Accumulated impairment (4,122) (4,091)
Net book value 10,820 10,809

At 1 January 10,820 10,809
Impairment charge recorded within other operating income (expense) (591) 0
Currency translation effects (839) 11
At 31 December 9,390 10,820
Cost 13,781 14,942

Accumulated impairment (4,391) (4,122)
Net book value 9,390 10,820
Allocated to the following cash-generating units

Roche Pharmaceuticals strategic transactions 4,379 5,388
Roche Pharmaceuticals product transactions 322 345
Chugai 66 77
Total Pharmaceuticals Division 4,767 5,810
Diagnostics customer areas 3,443 3,753

Diabetes Care customer area 80 85
Divisional goodwill 1,100 1,172
Total Diagnostics Division 4,623 5,010
Cash-generating units used for allocating goodwill
Pharmaceuticals Division. The basis for the use of the cash-generating units for allocating goodwill in the Pharmaceuticals
Division is as follows:
∙ Within the Roche Pharmaceuticals operating segment, goodwill arises from three broad types of transactions:
– Strategic transactions that have a transformative effect across the whole division.
– Technology transactions where the acquired technologies can have a range of areas of applications.
– Product transactions where the acquired products typically have more limited synergistic benefits outside of the immediate
product therapeutic area.
∙ The cash-generating unit for the goodwill arising from strategic transactions is the Roche Pharmaceuticals operating
segment.
∙ The cash-generating unit for the goodwill arising from technology transactions is also the Roche Pharmaceuticals operating
segment. However, if the acquired technologies permanently cease to operate, then this will be treated as a disposal of the
business; in such cases the goodwill will be deemed to have been disposed of and will be fully impaired.
∙ The cash-generating unit for the goodwill arising from product transactions is the smallest identifiable group of assets related
to the revenues and related costs that arise from the development and commercialisation of the product(s) in question. Where
there are synergistic benefits to other products in the same therapeutic area, then the revenues, costs and corresponding
assets of these other products are also taken into account. If the acquired products permanently cease to generate
economic benefits, then this will be treated as a disposal of the business; in such cases the goodwill will be deemed to have
been disposed of and will be fully impaired.
∙ Chugai is a separate operating segment in the Group’s financial reporting and a separate cash-generating unit to which
goodwill is allocated.
The Group allocated the goodwill in the Roche Pharmaceuticals operating segment as listed below.
∙ Strategic transactions consist of Genentech (1990/1999), Flatiron Health (2018) and Spark Therapeutics (2019).
∙ Technology transactions consist of Therapeutic Human Polyclonals (2007), Dutalys (2014) and Santaris (2014).
∙ Product transactions consist of GlycArt (2005) and Tanox (2007).
Diagnostics Division. The basis for the use of the cash-generating units for allocating goodwill in the Diagnostics Division is as
follows:
∙ Within the Diagnostics Division, goodwill arises from three broad types of transactions:
– Strategic transactions that have a transformative effect across the whole division.
– Technology transactions where the acquired technologies can have a range of areas of applications.
– Product transactions where the acquired products either have synergistic benefits across the wider business or where they
have more limited synergistic benefits outside of the immediate product therapeutic area.
∙ The cash-generating unit for the goodwill arising from strategic transactions is the Diagnostics Division.
∙ The cash-generating unit for the goodwill arising from technology transactions is either the Diagnostics customer areas or the
Diabetes Care customer area. However, if the acquired technologies permanently cease to operate, then this will be treated
as a disposal of the business; in such cases the goodwill will be deemed to have been disposed of and will be fully impaired.
∙ The cash-generating unit for the goodwill arising from product transactions is the smallest identifiable group of assets related
to the revenues and related costs that arise from the development and commercialisation of the product(s) in question. Where
there are synergistic benefits to other products in the same business, then the revenues, costs and corresponding assets of
these other products are also taken into account and the cash-generating unit is either the Diagnostics customer areas or
the Diabetes Care customer area. If the acquired products permanently cease to generate economic benefits, then this will
be treated as a disposal of the business; in such cases the goodwill will be deemed to have been disposed of and will be fully
impaired.
The Group allocated the goodwill in the Roche Diagnostics operating segment as listed below.
∙ Strategic transactions consist of Corange/Boehringer Mannheim (1997).
∙ Technology transactions consist of Viewics (2017) in the Diagnostics customer areas and mySugr (2017) in the Diabetes Care
customer area.
∙ Product transactions in the Diagnostics customer areas consist of Igen (2004), BioVeris (2007), Ventana (2008), PVT (2011),
IQuum (2014), GenMark (2021) and TIB Molbiol (2021).
∙ Product transactions in the Diabetes Care customer area consist of Disetronic (2003) and Medingo (2010).
Impairment charge – 2023
In October 2023 the Group announced that, effective 1 January 2024, the Foundation Medicine business will be moved under the
responsibility of the Diagnostics Division from the Pharmaceuticals Division, while retaining Foundation Medicine’s independence
in this new reporting set-up. Consequently the Foundation Medicine business was from the time of the announcement no longer
considered a strategic transaction for the Pharmaceuticals Division, in the context of accounting for goodwill, and was therefore
considered to be a product transaction for the regular impairment testing carried out at the end of 2023. The result of this
testing was that a full impairment of CHF 591 million was recorded for the goodwill from the Foundation Medicine acquisition.
There was no surplus from the estimated future revenues of the Foundation Medicine business to support the carrying value
of the goodwill, neither were there any significant future synergistic benefits to other products within the Pharmaceuticals
Division. Accordingly the separable recoverable value of this goodwill was estimated to be zero and it has been fully impaired.
Impairment charge – 2022
There were no impairments of goodwill during 2022.

Value in use
Value in use is calculated using a discounted expected cash flow approach, with a post-tax discount rate applied to the projected
risk-adjusted post-tax cash flows and terminal value. The discount rate is the Group’s weighted average cost of capital as the
cash-generating units have integrated operations across large parts of the Group. It is derived from a capital asset pricing model
using data from capital markets, including government twenty-year bonds. For assessing value in use, the cash flow projections
are based on the most recent long-term forecasts approved by management. The long-term forecasts include management’s
latest estimates on sales volume and pricing, as well as production and other operating costs and assume no significant changes
in the organisation. Other key assumptions used in the calculations are the period of cash flow projections included in the long-
term forecasts, the terminal value growth rate and the discount rate.
Key assumptions used in value-in-use calculations
2023 2022
Period of Terminal Period of Terminal
cash flow value Discount rate cash flow value Discount rate
rojections
p growth rate (after tax) rojections
p growth rate (after tax)
Pharmaceuticals Division 5 years n/a 7.2% 5 years n/a 7.5%
Diagnostics Division 5 years 1.5% 7.2% 5 years 1.5% 7.5%
For goodwill relating to Roche Pharmaceuticals product transactions, product-specific periods of cash flow projections are
used. For cash-generating units with a terminal value growth, the respective rate does not exceed the long-term projected
growth rate for the relevant market.
Fair value less costs of disposal
For goodwill arising from the Chugai acquisition, the fair value less costs of disposal is determined with reference to the publicly
quoted price of Chugai shares.
Sensitivity analysis
Management has performed sensitivity analyses for Roche Pharmaceuticals and the Diagnostics Division, which increased the
discount rate by 1% combined with decreasing the forecast cash flows by 5%, and for Chugai, which decreased the publicly
quoted share prices by 5%. The results of the sensitivity analyses demonstrated that the above changes in the key assumptions
would not cause the carrying values of goodwill to exceed the recoverable amounts at 31 December 2023.
10. Intangible assets
Intangible assets: movements in carrying value of assets in millions of CHF
Product Product
intangibles: intangibles: Other
in use not available for use intangibles Total
At 1 January 2022
Cost 27,202 8,029 2,001 37,232
Accumulated amortisation and impairment (21,212) (2,503) (1,400) (25,115)
Net book value 5,990 5,526 601 12,117

At 1 January 2022 5,990 5,526 601 12,117
Asset acquisitions 0 291 0 291
Additions 221 596 127 944
Disposals 0 0 0 0
Transfers 94 (94) 0 –
Amortisation charge (847) – (91) (938)
Impairment charge (1,484) (1,353) 0 (2,837)
Currency translation effects 96 13 (1) 108
At 31 December 2022 4,070 4,979 636 9,685
Cost 27,473 8,375 2,118 37,966

Net book value 4,070 4,979 636 9,685
Allocated by operating segment

Roche Pharmaceuticals 2,705 4,571 529 7,805
Chugai 10 39 12 61
Diagnostics 1,355 369 95 1,819
Total Group 4,070 4,979 636 9,685

At 1 January 2023 4,070 4,979 636 9,685
Asset acquisitions 6 26 6,193 0 6,219
Additions 385 530 101 1,016
Disposals 0 0 0 0
Transfers 31 (31) 0 –
Amortisation charge (616) – (100) (716)
Impairment charge (208) (400) 0 (608)
Other 0 0 (1) (1)
Currency translation effects (253) (468) (46) (767)
At 31 December 2023 3,435 10,803 590 14,828
Cost 25,934 14,321 1,966 42,221

Net book value 3,435 10,803 590 14,828
Allocated by operating segment

Roche Pharmaceuticals 2,309 10,446 477 13,232
Chugai 4 17 5 26
Diagnostics 1,122 340 108 1,570
Total Group 3,435 10,803 590 14,828
Significant intangible assets at 31 December 2023 in millions of CHF

Remaining
Operating segment Net book value amortisation period
Product intangibles in use
GenMark acquisition Diagnostics 562 11 years
Rozlytrek (Ignyta acquisition) Roche Pharmaceuticals 546 8 years
Xofluza (Shionogi in-licensing transaction) Roche Pharmaceuticals 365 12 years
Product intangibles not available for use

RVT-3101 (Telavant acquisition) Roche Pharmaceuticals 5,998 n/a
Elevidys (Sarepta in-licensing transaction) Roche Pharmaceuticals 815 n/a
SPK-8011 haemophilia A gene therapy (Spark Therapeutics acquisition) Roche Pharmaceuticals 484 n/a
Inflazome acquisition Roche Pharmaceuticals 359 n/a
Stratos Genomics acquisition Diagnostics 326 n/a
Alnylam in-licensing transaction Roche Pharmaceuticals 264 n/a
Good Therapeutics acquisition Roche Pharmaceuticals 206 n/a
BioNTech in-licensing transaction Roche Pharmaceuticals 196 n/a
Other intangibles – Technology intangibles in use

Adaptive in-licensing transaction Roche Pharmaceuticals 190 15 years
Classification of intangible asset amortisation and impairment expenses in millions of CHF

Amortisation Impairment
2023 2022 2023 2022
Cost of sales
– Pharmaceuticals (244) (415) (183) (1,472)
– Diagnostics (136) (145) 0 0
– Pharmaceuticals (301) (336) (406) (1,365)
– Diagnostics (7) (8) (19) 0
Selling, general and administration
– Pharmaceuticals (9) (13) 0 0
– Diagnostics (19) (21) 0 0
Total (716) (938) (608) (2,837)
Internally generated intangible assets
At 31 December 2023 internally generated intangible assets relating to commercial software amounted to CHF 70 million
(2022: CHF 32 million) and are included in other intangibles. Other than that the Group has no internally generated intangible
assets from development as the criteria for the recognition as an asset are not met.
Intangible assets with indefinite useful lives
The Group currently has no intangible assets with indefinite useful lives.
Intangible assets not available for use
These mostly represent in-process research and development assets acquired either through in-licensing arrangements,
business combinations, asset acquisitions or separate purchases. On 31 December 2023 approximately 28% (2022: 88%) of
the projects in the Pharmaceuticals Division had known decision points within the next twelve months which, under certain
circumstances, could lead to impairment. Excluding the product intangible RVT-3101 acquired as part of the Telavant
acquisition, this percentage is 65%. Due to the inherent uncertainties in the research and development processes, intangible
assets not available for use are particularly at risk of impairment if the project is not expected to result in a commercialised
product.
Intangible asset impairment
Impairment charges arise from changes in the estimates of the future cash flows expected to result from the use of the asset and
its eventual disposal. Factors such as the presence or absence of competition, technical obsolescence or lower-than-anticipated
sales for products with capitalised rights could result in shortened useful lives or impairment.
Impairment charges – 2023
Pharmaceuticals Division. Impairment charges totalling CHF 589 million were recorded. The major items related to:
∙ A charge of CHF 183 million for the partial impairment of the product intangible asset for Rozlytrek, acquired as part of the
Ignyta acquisition, due to reduced sales expectations. The asset concerned was written down to its estimated recoverable
amount of CHF 546 million. The intangible asset in use continues to be amortised over its remaining estimated useful life of
eight years.
∙ A charge of CHF 87 million following a delay in clinical trials and revised sales expectations of a compound purchased
separately. The asset concerned, which was not yet being amortised, was fully written down.
∙ A charge of CHF 82 million following a clinical data assessment and the decision to stop part of the development of a
compound with an alliance partner. The asset concerned, which was not yet being amortised, was fully written down.
∙ A charge of CHF 65 million following a clinical data assessment and the decision to stop part of the development of a
compound with an alliance partner. The asset concerned, which was not yet being amortised, was written down to its
estimated recoverable amount of CHF 137 million.
∙ A charge of CHF 61 million following the decision to stop a programme with an alliance partner. The asset concerned, which
was not yet being amortised, was fully written down.
∙ A charge of CHF 57 million for the partial impairment of the product intangible asset for SPK-9001, a novel gene therapy for
the treatment of haemophilia B that was acquired as part of the Spark Therapeutics acquisition. This impairment was a result
of revised sales expectations. The asset concerned, which was not yet being amortised, was written down to its estimated
recoverable amount of CHF 109 million.
Diagnostics Division. Impairment charges totalling CHF 19 million were recorded. The major items related to:
∙ A charge of CHF 19 million following the decision to deprioritise the development of the underlying asset with a collaboration
partner. The asset concerned, which was being amortised, was fully written down.
Impairment charges – 2022
Pharmaceuticals Division. Impairment charges totalling CHF 2,837 million were recorded. The major items related to:
∙ A charge of CHF 663 million for the full impairment of the in-licensed Gavreto product intangible asset due to lower sales
expectations. The asset concerned, which was being amortised, was fully written down.
the treatment of haemophilia A that was acquired as part of the Spark Therapeutics acquisition. This impairment was a result
∙ A charge of CHF 362 million for the full impairment of the product intangible asset for PRM-151, a novel anti-fibrotic
immunomodulator for the treatment of idiopathic pulmonary fibrosis that was acquired as part of the Promedior acquisition.
The impairment was due to the decision to stop development following a data assessment. The asset concerned, which was
not yet being amortised, was fully written down.
∙ A charge of CHF 336 million for the partial impairment of the product intangible asset relating to the technology acquired
as part of the Flatiron acquisition. The impairment was a result of reduced sales expectations. The asset concerned was
written down to its estimated recoverable amount of CHF 56 million. The intangible asset continues to be amortised over its
remaining estimated useful life of ten years.
∙ A charge of CHF 292 million for the partial impairment of the product intangible asset for Rozlytrek, acquired as part of the
Ignyta acquisition, due to lower sales expectations. The asset concerned was written down to its estimated recoverable
amount of CHF 882 million. The intangible asset in use continues to be amortised over its remaining estimated useful life of
nine years.
∙ A charge of CHF 117 million for the full impairment of the product intangible asset relating to Foundation Medicine’s
technology. The impairment was a result of increased competition and reduced sales expectations. The asset concerned,
which was being amortised, was fully written down.
the treatment of haemophilia B that was acquired as part of the Spark Therapeutics acquisition. This impairment was a result
∙ A charge of CHF 100 million following a clinical data assessment and the decision to stop the development of CD25, acquired
as part of the Tusk Therapeutics acquisition. The asset concerned, which was not yet being amortised, was fully written down.
∙ A charge of CHF 95 million due to the decision to stop the development of a compound and the related collaboration with an
alliance partner. The asset concerned, which was not yet being amortised, was fully written down.
∙ A charge of CHF 86 million following a clinical data assessment and the decision to stop the development of NLRP3 inhibitors,
acquired as part of the Jecure Therapeutics acquisition. The asset concerned, which was not yet being amortised, was fully
written down.
∙ A charge of CHF 60 million for the partial impairment of the product intangible asset for Luxturna, acquired as part of the
Spark Therapeutics acquisition. The impairment was a result of reduced sales expectations. The asset concerned was written
down to its estimated recoverable amount of CHF 76 million. The intangible asset continues to be amortised over its remaining
estimated useful life of five years.
∙ A charge of CHF 54 million for the full impairment of the product intangible asset for SPK-3006, a novel gene therapy for the
treatment of late-onset Pompe disease that was acquired as part of the Spark Therapeutics acquisition. This impairment was
a result of a change in timelines of the underlying development programme leading to reduced sales expectations. The asset
concerned, which was not yet being amortised, was fully written down.
Potential commitments from alliance collaborations and intangible asset purchase agreements within the next three years
The Group is party to in-licensing and alliance arrangements and intangible asset purchase agreements, including asset
acquisitions. These arrangements and purchase agreements may require the Group to make certain milestone or other similar
payments dependent upon the achievement of agreed objectives or performance targets as defined in the collaboration and
purchase agreements.
The Group’s current estimate of future third-party commitments for such potential payments within the next three years is set
out in the table below. These figures are undiscounted and are not risk-adjusted, meaning that they include all such potential
payments that can arise assuming all projects currently in development are successful. The timing is based on the Group’s
current best estimate. These figures do not include any potential commitments within the Group, such as may arise between the
Roche and Chugai businesses.
Potential future third-party collaboration and purchase payments at 31 December 2023 in millions of CHF
Pharmaceuticals Diagnostics Group

Within one year 940 34 974
Between one and two years 1,193 1 1,194
Between two and three years 584 60 644
Total 2,717 95 2,812
11. Inventories
Inventories in millions of CHF
2023 2022 2021

Raw materials and supplies 1,698 1,949 1,547
Work in process 118 118 100
Intermediates 5,504 6,273 5,738
Finished goods 1,182 1,138 1,202
Allowances for slow-moving and obsolete inventory (753) (873) (872)
Total inventories 7,749 8,605 7,715
Inventories expensed through cost of sales totalled CHF 12.3 billion (2022: CHF 14.4 billion). Inventory write-downs during the
year resulted in an expense of CHF 643 million (2022: CHF 509 million).
12. Accounts receivable
Accounts receivable in millions of CHF
2023 2022 2021

Trade receivables 12,076 12,613 11,965
Notes receivable 55 33 45
Other receivables 51 52 54
Allowances for doubtful accounts (440) (490) (538)
Chargebacks and other allowances to be withheld upon settlement 3 (721) (602) (720)
Total accounts receivable 3 11,021 11,606 10,806
Allowances for doubtful accounts: movements in recognised allowance in millions of CHF
2023 2022
At 1 January (490) (538)
Additional allowances created (104) (128)
Unused amounts reversed 125 156
Utilised during the year 10 11
Currency translation effects 19 9
At 31 December (440) (490)
Bad debt expenses recorded as selling, general and administration costs totalled CHF 6 million (2022: expense of
CHF 3 million).
13. Marketable securities
Marketable securities in millions of CHF
2023 2022 2021

Equity securities at fair value through profit or loss 31 1 1 2
Debt securities at fair value through OCI 31 512 583 494
Debt securities at fair value through profit or loss 0 0 71
Money market instruments at fair value through OCI 31 2,359 3,811 2,816
Time accounts over three months at amortised costs 31 2,262 381 2,798
Total marketable securities 5,134 4,776 6,181
Marketable securities are held for fund management purposes and are primarily denominated in US dollars, euros and in Swiss
francs. Money market instruments are contracted to mature within one year of 31 December 2023.
Debt securities – contracted maturity in millions of CHF
2023 2022 2021

Within one year 120 107 130
Between one and five years 387 453 358
More than five years 5 23 77
Total debt securities 512 583 565
14. Cash and cash equivalents
Cash and cash equivalents in millions of CHF
2023 2022 2021

Cash – cash in hand and in current or call accounts 4,102 2,841 5,028
Cash equivalents – time accounts with a maturity of three months or less 1,274 2,150 1,822
Total cash and cash equivalents 5,376 4,991 6,850
15. Other non-current assets
Other non-current assets in millions of CHF
2023 2022 2021

Equity investments at fair value through OCI 31 249 356 328
Equity and debt investments at fair value through profit or loss 31 298 315 410
Loans receivable 7 7 7
Restricted cash 1 1 1
Other receivables – contracts with customers 3 19 26 36
Total financial non-current assets 661 797 872
Long-term employee benefits 188 193 234

Other assets 873 948 834
Total non-financial non-current assets 1,061 1,141 1,068
Associates 242 300 331
Total other non-current assets 1,964 2,238 2,271
Equity investments designated at fair value through OCI are mainly investments in private companies from the pharmaceutical
sector which are held as part of the Group’s strategic alliance efforts.
16. Other current assets
Other current assets in millions of CHF
2023 2022 2021

Accrued interest income 20 6 12
Derivative financial instruments 31 148 167 189
Cash collateral receivables 61 198 23
Other receivables – contracts with customers 3 633 686 646
Total financial current assets 1,045 1,249 1,081
Prepaid expenses and accrued income 1,144 1,202 1,869

Other taxes recoverable 718 865 633
Other assets 223 209 172
Total non-financial current assets 2,085 2,276 2,674
Total other current assets 3,130 3,525 3,755

17. Accounts payable
Accounts payable in millions of CHF
2023 2022 2021

Trade payables 3,524 3,861 3,844
Other taxes payable 539 421 519
Dividends payable 2 3 3
Other payables 260 271 271
Total accounts payable 4,325 4,556 4,637
18. Other non-current liabilities
Other non-current liabilities in millions of CHF
2023 2022 2021

Deferred income 227 254 246
Lease liabilities 28 1,282 891 1,025
Other long-term liabilities 32 44 36
Total other non-current liabilities 1,541 1,189 1,307
19. Other current liabilities
Other current liabilities in millions of CHF
2023 2022 2021

Deferred income 614 601 560
Lease liabilities 28 291 302 329
Accrued payroll and related items 2,995 3,117 3,399
Interest payable 187 140 102
Derivative financial instruments 31 420 626 262
Cash collateral payables 11 18 40
Accrued chargebacks and other allowances separately payable 3 3,602 3,577 3,486
Accrued royalties and commissions 968 1,380 1,294
Other accrued liabilities 3,062 3,527 3,657
Total other current liabilities 12,150 13,288 13,129
20. Provisions and contingent liabilities
Provisions: movements in recognised liabilities in millions of CHF
Contingent
Legal Environmental Restructuring consideration Other
provisions provisions provisions provisions provisions Total
At 1 January 2022 372 447 1,427 141 1,581 3,968
Additional provisions created 33 12 149 2 868 1,064
Unused amounts reversed (67) (1) (221) (41) (215) (545)
Utilised (23) (51) (488) 0 (490) (1,052)
Discount unwind, including effects from discount
rate changes 4 0 (20) (7) (1) 1 (27)
Business combinations
– Acquired companies 0 0 0 0 0 0
– Deferred consideration – – – – 0 0
– Contingent consideration – – – 0 – 0
Asset acquisitions 0 0 0 – 0 0
Currency translation effects 1 (13) (16) 2 (23) (49)
At 31 December 2022 316 374 844 103 1,722 3,359
Current 307 88 419 38 1,396 2,248

Non-current 9 286 425 65 326 1,111
At 31 December 2022 316 374 844 103 1,722 3,359

At 1 January 2023 316 374 844 103 1,722 3,359
Additional provisions created 45 61 450 0 877 1,433
Unused amounts reversed (171) (8) (86) (10) (579) (854)
Utilised (48) (53) (337) 0 (614) (1,052)
Discount unwind, including effects from discount
rate changes 4 0 10 3 6 0 19
Business combinations
– Acquired companies 0 0 0 0 0 0
– Deferred consideration – – – – 0 0
– Contingent consideration – – – 0 – 0
Asset acquisitions 0 0 0 – 0 0
Currency translation effects (16) (23) (23) (4) (96) (162)
At 31 December 2023 126 361 851 95 1,310 2,743
Current 120 77 468 35 984 1,684

Non-current 6 284 383 60 326 1,059
At 31 December 2023 126 361 851 95 1,310 2,743
Expected outflow of resources

Within one year 120 77 468 35 984 1,684
Between one and two years 2 103 234 12 113 464
Between two and three years 1 75 92 26 47 241
More than three years 3 106 57 22 166 354
At 31 December 2023 126 361 851 95 1,310 2,743
In 2023 CHF 1,052 million of provisions were utilised (2022: CHF 1,052 million), which are included in the cash flows from
operating activities.
Legal provisions
Legal provisions relate to a number of separate legal matters, including claims arising from trade, in various Group companies.
By their nature the amounts and timings of any outflows are difficult to predict.
As part of the regular review of litigation matters, management has reassessed the provisions recorded for certain litigation
matters. Based on the development of the various litigations, notably the Meso case, some of the provisions previously held
were released which resulted in an income of CHF 171 million in 2023. In addition, a fine of CHF 59 million imposed by the
French Competition Authority on the Avastin/Lucentis investigation in 2020 was reimbursed following a court decision. These
were the major elements in the expenses for legal cases in 2023, which show a net income of CHF 182 million reported in other
operating income (expense) (2022: net income of CHF 25 million). Details of the major legal cases outstanding are disclosed
below.
Environmental provisions
Provisions for environmental matters relate to various separate environmental issues in a number of countries. By their nature
the amounts and timings of any outflows are difficult to predict. At 31 December 2023 significant provisions were discounted by
between 3% and 5% (2022: between 4% and 5%) where the time value of money was material. The significant provisions relate
to the estimated remediation costs for the manufacturing site at Clarecastle, Ireland, which was shut down in the meantime,
and to the US site in Nutley, New Jersey, which was divested in September 2016. In 2023 environmental provisions decreased by
CHF 13 million, mainly due to utilisations and currency translation effects and partially offset by an increase in provisions. The
net environmental expenses reported in other operating income (expense) in 2023 were CHF 60 million (2022: net expenses of
CHF 3 million) and included an increase of provisions of CHF 61 million mainly for the Clarecastle site following a reassessment
of the expected costs of the environmental remediation.
The Group’s procedures on environmental protection are included in the Annual Report on pages 78 to 83. These include
the actions taken by the Group with regard to climate change, notably the Group’s commitment to reduce greenhouse gas
emissions.
Restructuring provisions
These arise from planned programmes that materially change the scope of business undertaken by the Group or the manner
in which business is conducted. Such provisions include only the costs necessarily entailed by the restructuring which are not
associated with the recurring activities of the Group. The timings of these cash outflows are reasonably certain. Significant
non-current provisions are discounted using an average discount rate of 1.4% (2022: 2.1%).
In the Pharmaceuticals Division the significant provisions relate to various business transformation initiatives, including the
site development plans at the Basel/Kaiseraugst site and the resourcing flexibility plans, as well as to the redesign and the
strategic realignment of its manufacturing network mainly in the US. In the Diagnostics Division the significant provisions are
associated with manufacturing and supply chain optimisations, research and development productivity initiatives and business
transformations measures. Additionally, provisions were also recorded for a cross-divisional transformation programme to
simplify the systems landscape and reduce process complexity. Further details are given in Note 7.
Contingent consideration provisions
The Group is party to certain contingent consideration arrangements arising from business combinations. Significant non-
current provisions are discounted using an average discount rate of 4.9% (2022: 5.3%) where the time value of money is
material. Additional details on measurement and on the total potential payments under these arrangements are provided in
Note 31.
Other provisions
Other provisions relate to the items shown in the table below. With the exception of employee provisions, the timing of cash
outflows is by its nature uncertain.
Other provisions in millions of CHF
2023 2022 2021

Sales returns 3 481 588 514
Employee provisions 406 366 384
Other items 423 768 683
Total other provisions 1,310 1,722 1,581
Contingent liabilities
The operations and earnings of the Group continue, from time to time and in varying degrees, to be affected by political,
legislative, fiscal and regulatory developments, including those relating to environmental protection, in the countries in which it
operates. The industries in which the Group operates are also subject to other risks of various kinds. The nature and frequency
of these developments and events, not all of which are covered by insurance, as well as their effect on future operations and
earnings, are not predictable.
The Group has entered into in-licensing and alliance arrangements and intangible asset purchase agreements, including asset
acquisitions, in order to gain access to potential new products or to utilise other companies to help develop the Group’s own
potential new products. These arrangements and purchase agreements may require the Group to make certain milestone or
other similar payments dependent upon the achievement of agreed objectives or performance targets as defined in the
collaboration and purchase agreements. The Group’s current estimate of future third-party commitments for such potential
payments within the next three years is given in Note 10.
Legal cases
At 31 December 2023 legal provisions included provisions for legal cases of CHF 55 million (2022: CHF 235 million), mainly
related to legal cases in the Pharmaceuticals Division of CHF 16 million (2022: CHF 21 million) and in the Diagnostics Division of
CHF 39 million (2022: CHF 214 million). Provisions have been recorded, and in some cases settled, mainly relating to the legal
matters listed below.
Avastin/Lucentis investigations. On 14 February 2013 the Italian Antitrust Authority (‘AGCM’) announced an investigation
to determine whether Roche, Genentech and Novartis had entered into an agreement to restrict competition in the Italian
market for drugs, with reference in particular to Avastin (marketed by Roche) and Lucentis (marketed by Novartis). Avastin
and Lucentis are two different drugs that were developed and approved for different therapeutic purposes and contain
different active pharmaceutical ingredients. On 5 March 2014 the AGCM issued a verdict that alleges that Roche and Novartis
colluded to artificially differentiate Avastin and Lucentis in order to foster the sales of Lucentis in Italy. The AGCM fined Roche
EUR 90.5 million and Novartis EUR 92 million. Roche appealed the AGCM verdict to the Tribunale Amministrativo Regionale
del Lazio (‘TAR’). On 2 December 2014 the TAR upheld the decision by the AGCM. Roche appealed the verdict of the TAR
to the Consiglio di Stato. In July 2014 Roche paid the EUR 90.5 million fine under protest to avoid additional penalty fees.
On 23 January 2018 the European Court of Justice rendered its decision on five questions which had been referred to the
European Court of Justice by the Consiglio di Stato. On 15 July 2019 the Consiglio di Stato issued the final verdict on the case
and upheld the verdicts of both the AGCM and the TAR. Roche filed an appeal with the Corte Suprema di Cassazione, which was
rejected on 5 October 2021. In addition, Roche filed a motion for revocation with the Consiglio di Stato, which was rejected on
8 May 2023. This matter is now concluded. On 24 January 2019 the French Competition Authority (‘FCA’) issued a Statement
of Objections against Roche, Genentech and Novartis regarding anti-competitive practices concerning the commercialisation
of Avastin and Lucentis in France. The FCA alleges that Roche, Genentech and Novartis abused their collective dominant
position on the French market for the treatment of wet age-related macular degeneration between 2008 and 2013. On
9 September 2020 the FCA issued a decision finding that Roche, Genentech and Novartis had infringed competition law, and
imposed a fine of EUR 60 million against Roche and Genentech. Roche and Genentech appealed this decision. In January 2021
the fine was paid under protest to avoid additional penalty fees. On 16 February 2023 the Paris Court of Appeal issued its ruling
in the Group’s favour. As a result, the FCA reimbursed the fine in March 2023 and an income of EUR 60 million was recorded in
other operating income (expense) in 2023. In March 2023 the FCA appealed this decision. In September 2021 Roche received
an administrative fine letter from the Turkish Competition Authority (‘TCA’). In its investigation the TCA alleges that Roche and
Novartis entered into a cartel aiming at preventing off-label applications of Avastin in order to foster on-label applications of
Lucentis. In October 2021 the fine of TRY 85 million was paid under protest to avoid additional penalty fees. Roche filed an
appeal against the decision. On 30 January 2023 the Ankara Administrative Court issued its ruling in the Group’s favour. As a
result, the TCA reimbursed the fine and an income of TRY 85 million was recorded in other operating income (expense) in 2023.
In April 2023 the TCA appealed this decision. In addition, the Group is challenging policies and regulations allowing off-label/
unlicensed use and reimbursement for economic reasons in various countries. The Group is vigorously defending itself in these
matters. The outcome of these matters cannot be determined at this time.
Boniva litigation. Hoffmann-La Roche, Inc. (‘HLR’), Genentech and various other Roche affiliates (collectively ‘Roche’) have
been named as defendants in numerous legal actions in the US and one now dismissed case in Canada relating to the post-
menopausal osteoporosis medication Boniva. In these litigations, the plaintiffs allege that Boniva caused either osteonecrosis
of the jaw or atypical femoral fractures. At 31 December 2023 Roche was defending approximately 206 actions involving
approximately 245 plaintiffs brought in federal and state courts throughout the US for personal injuries allegedly resulting from
the use of Boniva. All of these cases are in the early discovery stages of litigation. Individual trial results depend on a variety
of factors, including many that are unique to the particular case. Roche is vigorously defending itself in these matters. The
outcome of these matters cannot be determined at this time.
Meso litigation. In February 2017 Roche Diagnostics Corporation (‘Roche’) filed a lawsuit in the US District Court for the District
of Delaware against Meso Scale Diagnostics, LLC (‘Meso’). This is a patent infringement case involving certain US patents owned
by BioVeris Corporation (‘BioVeris’), a company acquired by the Group in 2007. Meso holds a limited exclusive licence to use
certain aspects of the electrochemiluminescence (‘ECL’) detection technology. Roche and Meso disagree on the scope of the
licence. The lawsuit is seeking a declaratory judgment to get judicial clarification that Roche is not infringing Meso’s licence. On
25 November 2019 the jury found that Roche’s use of the patents infringed the scope of Meso’s licence. There was no injunction
granted and the jury awarded Meso USD 137 million in damages. In 2020 post-trial motions were filed by both parties and Meso
moved for enhancement, pre-judgment interest and post-judgment royalties. The court hearing took place on 6 May 2020. On
23 December 2020 the US District Court issued the final order of judgment in which the jury award was confirmed and Meso’s
request for enhanced damages was denied. The Group appealed this decision. On 8 April 2022 the US Court of Appeal issued
its ruling. It reversed the induced infringement decision and vacated the damages award. The US Court of Appeal also affirmed
that Roche directly infringed one patent and vacated the US District Court’s decision on 23 December 2020 of non-infringement
of three other patents. The case was remanded back to the US District Court for a new damages trial. On 7 March 2023 the
parties agreed to a settlement that resolved all the disputes between them. On 27 March 2023 the court approved the joint
stipulation for dismissal of the case. The matter is now concluded.
In addition, the legal cases in the Pharmaceuticals Division listed below do not currently have provisions recorded, but there
are potential future obligations which will be confirmed only by the occurrence or non-occurrence of uncertain future events or
where the obligation cannot be measured with sufficient reliability.
Hemlibra litigation. On 4 May 2017 Baxalta Inc. and Baxalta GmbH (both together ‘Baxalta’), subsidiaries of Takeda
Pharmaceutical Company Limited, filed a patent infringement and declaratory judgment of patent infringement suit in the
US District Court for the District of Delaware, alleging that Genentech and Chugai Pharmaceutical Co., Ltd. (‘Chugai’) currently
or imminently would manufacture, use, sell, offer for sale, or import into the US Hemlibra, which would infringe Baxalta’s
US Patent No. 7,033,590. Baxalta was seeking a judgment of infringement, injunctive and monetary relief, attorneys’ fees, costs
and expenses. On 11 May 2017 Genentech was served with the complaint. Genentech’s response and counterclaims to the
complaint were filed on 30 June 2017. On 19 June 2017 Chugai waived service. On 13 September 2017 Chugai filed a motion to
dismiss the complaint for lack of personal jurisdiction. On 14 December 2017 Baxalta filed a request for a preliminary injunction
against Genentech only, in which some inhibitor patients would not be subject to any injunction. A hearing was held in the
US District Court for the District of Delaware on 13 and 14 June 2018 and during that hearing Baxalta withdrew its request for
a preliminary injunction as to the inhibitor patients. On 25 June 2018 Baxalta submitted a new proposed preliminary injunction
order, in which Genentech would be permitted to sell Hemlibra to all inhibitor patients, all non-inhibitor patients currently on
Hemlibra whether through clinical trials or not, and selected non-inhibitor patients who have an additional ‘medically diagnosed
condition’ which rendered factor VIII therapies impracticable. On 7 August 2018 the US District Court ruled against Baxalta,
denying their request for an injunction. On 19 September 2018 Chugai was dismissed from this case. On 1 February 2019
the US District Court issued a final judgment in favour of Genentech stating that Hemlibra does not infringe Baxalta’s patent
based on the Court’s definition of key terms related to the patent. On 8 February 2019 Baxalta appealed this decision.
On 27 August 2020 the Appeals Court reversed the claim construction ruling of the US District Court in favour of Genentech
and remanded the case back to the US District Court. On 3 September 2021 Genentech filed a motion for summary judgment on
multiple grounds. On 19 November 2021 the US District Court heard Genentech’s motions for summary judgment of invalidity,
non-infringement under the doctrine of equivalence, and no wilful infringement. On 13 January 2022 the US District Court
granted Genentech’s motion for summary judgment of no enablement, which means that the previously scheduled trial will be
cancelled. Baxalta appealed this ruling. On 20 September 2023 the US Federal Court affirmed the US District Court’s decision
from 13 January 2022. The matter is now concluded.
Iraqi Ministry of Health. In October 2017 F. Hoffmann-La Roche Ltd (‘FHLR’), Hoffmann-La Roche, Inc. (‘HLR’) and Genentech
and certain other pharmaceutical and/or medical device companies were named as defendants in a complaint filed in the
Federal District Court for the District of Columbia, US, on behalf of US service members and their relatives who allege that
they were killed or injured in Iraq between 2005 and 2009 (the ‘Iraq lawsuit’). The complaint alleges that the defendants
violated the US Anti-Terrorism Act and various state laws by providing funding for terrorist organisations through their sales
practices pursuant to pharmaceutical and/or medical device contracts with the Iraqi Ministry of Health. In addition FHLR
received an inquiry in July 2018 from the US Department of Justice in connection with an anti-corruption investigation relating
to activities in Iraq, including interactions with the Iraqi government and certain of the same matters alleged in the Iraq lawsuit.
On 29 October 2019 the US Department of Justice closed its inquiry against FHLR. On 17 July 2020 the Federal District
Court granted the defendants’ motions to dismiss. The plaintiffs appealed this decision. On 4 January 2022 the US Court of
Appeals for the District of Columbia Circuit reversed the decision of the Federal District Court and remanded the case for
further proceedings. Defendants filed petitions for rehearing en banc by the US Court of Appeals for the District of Columbia
Circuit, which were denied on 2 February 2023. On 1 March 2023 the Federal District Court granted defendants’ motion for a
temporary partial stay pending the US Supreme Court’s decision on a related matter. On 18 May 2023 the US Supreme Court
reversed the decision in the related matter, clarifying the law under the US Anti-Terrorism Act. On 30 June 2023 defendants
filed a petition for certiorari to the US Supreme Court on the merits asking the US Supreme Court to grant, vacate and remand
for further proceedings as a result of another of its recent decisions on the US Anti-Terrorism Act, which remains pending.
The Group is vigorously defending itself in this matter. The outcome of this matter cannot be determined at this time.
Tamiflu qui tam litigation. In 2019, Roche Holding Ltd (‘Roche Holding’), Hoffmann-La Roche, Inc. (‘HLR’) and Genentech,
Inc. (‘Genentech’) were served with a lawsuit filed by a relator in the US District Court for the District of Maryland under the
qui tam (whistleblower) provisions of the False Claims Act. The lawsuit was originally filed under seal years earlier on behalf
of the US government and various US state governments. The lawsuit alleges certain improper conduct by the Group with
respect to sales of Tamiflu to the US government and various US state governments. The US Department of Justice declined to
intervene in the lawsuit. On 17 January 2020 the Group filed a motion to dismiss. On 28 September 2020 the plaintiff dismissed
the complaint as to Roche Holding and Genentech and the District Court denied HLR’s motion for summary judgment. On
4 November 2022 the US Department of Justice filed a motion to dismiss the claim. The motion was stayed pending a decision
from the US Supreme Court on a related matter. This decision was issued in June 2023. On 12 July 2023 the whistleblower
filed a stipulation of voluntary dismissal of all his claims, including all of those asserted on behalf of the US government and
various US state governments. The stipulation was approved by the US District Court for the District of Maryland on 13 July 2023.
The matter is now concluded.
Novartis litigation related to Cabilly royalties. Following the expiry of the Cabilly patent in December 2018, Genentech and
Novartis discussed Cabilly royalties owed for Cosentyx and Ilaris manufactured in, or imported into, the US prior to patent
expiry but sold after patent expiry (the ‘Inventory Dispute’). On 25 May 2021 Novartis Vaccines and Diagnostics, Inc. and
Novartis Pharma AG (collectively ‘Novartis’) filed a lawsuit against Genentech, Inc. (‘Genentech’) in California state court, in
San Mateo County. Novartis alleged that it mistakenly overpaid, and is entitled to the return of, certain Cabilly royalties for its
products Cosentyx and Ilaris, totalling USD 210 million. Among other things, Novartis claimed that Cosentyx was not a ‘Licensed
Product’ within the meaning of the contract. On 24 June 2021 Genentech filed a notice of removal, seeking to move the case
from state court to federal court. On 1 July 2021 Genentech filed a motion to dismiss all the claims on various grounds. In
response to Genentech’s motion, Novartis withdrew its initial complaint and filed an amended complaint on 20 August 2021.
On 3 September 2021 Genentech filed a motion to dismiss the amended complaint on similar grounds. On 11 February 2022
Novartis and Genentech engaged in a voluntary mediation, which did not result in a settlement outcome. On 2 May 2023 the
court dismissed with prejudice Novartis’ five state-law claims seeking a refund for royalties paid under the parties’ Cabilly
licence. The court found the claims to be foreclosed by the federal patent bar and denied, as futile, Novartis’ request for leave
to amend the complaint. The court denied Genentech’s motion to dismiss with respect to Novartis’ remaining claim for a judicial
declaration that it did not owe royalties in relation to the Inventory Dispute, and that claim will proceed.
Herceptin investigation. On 8 February 2022 the South African Competition Commission (‘Commission’) filed a referral with
the Competition Tribunal for prosecution of Roche Holding Ltd, F. Hoffmann-La Roche Ltd and Roche Products (Pty) Ltd
(together ‘Roche’) for alleged excessive pricing of trastuzumab (Herceptin) in contravention of the South African Competition
Act. The Commission’s referral affidavit also alleges that the excessive price of Herceptin constitutes a violation of basic
human rights including the right of access to healthcare enshrined in South Africa’s Bill of Rights as it denies access to life-
saving medicine for women living with breast cancer. The alleged excessive pricing of Herceptin by Roche took place between
January 2011 and November 2020 in the South African private healthcare sector and in the South African public healthcare
sector during the period from November 2015 to July 2020. The Commission has asked the Competition Tribunal to impose a
penalty against Roche. On 14 October 2022 Roche submitted its replies to the Competition Tribunal. The Group is vigorously
defending itself in this matter. The outcome of this matter cannot be determined at this time.
University of Pennsylvania litigation. On 31 January 2022 the University of Pennsylvania filed a patent litigation action in
the US against Genentech, Inc. (‘Genentech’) based on a claim that Herceptin, Perjeta, Phesgo and Herceptin Hylecta would
infringe their US Patent No. 7,625,558 (the ’558 patent). According to the complaint, the ’558 patent generally relates to
methods of treating ErbB (HER2) protein-mediated cancer tumours by administering a compound that inhibits the formation
of ErbB (HER2) followed by radiation. Genentech filed a partial motion to dismiss the University of Pennsylvania’s claims of
wilfulness on 24 March 2022, which was granted on 2 December 2022. The University of Pennsylvania filed a motion to amend
its complaint to add wilfulness back in, which was granted by the court on 5 May 2023. The University of Pennsylvania filed
a first amended complaint on 17 May 2023. A jury trial was scheduled for September 2024 but that date was vacated and a
new trial date has not been set. The Group is vigorously defending itself in this matter. The outcome of this matter cannot be
determined at this time.
21. Debt
Debt: movements in carrying value of recognised liabilities in millions of CHF
2023 2022
At 1 January 25,351 31,198
Proceeds from issue of bonds and notes 8,167 8,442

Redemption and repurchase of bonds and notes (1,751) (1,750)
Increase (decrease) in commercial paper (806) 1,293
Increase (decrease) in other debt 175 (13,683)
Changes from financing cash flows 5,785 (5,698)
Net (gains) losses on redemption and repurchase of bonds and notes 4 0 0

Amortisation of debt discount 4 8 4
Financing costs 8 4
Business combinations 0 0
Asset acquisitions 0 0
Net foreign currency transaction (gains) losses 3 47

Currency translation effects (2,026) (64)
Changes in foreign exchange rates (2,023) (17)
Changes in fair values of hedging instruments 88 (136)

Other changes 0 0
At 31 December 29,209 25,351
Bonds and notes 27,812 23,158

Commercial paper 848 1,755
Amounts due to banks and other financial institutions 547 436
Other borrowings 2 2
Total debt 29,209 25,351
Long-term debt 24,809 21,391

Short-term debt 4,400 3,960
Total debt 29,209 25,351
There are no pledges on the Group’s assets in connection with debt.

Bonds and notes
Recognised liabilities and effective interest rates of bonds and notes in millions of CHF
Effective interest rate

Underlying Including
instrument hedging 2023 2022 2021
US dollar notes – fixed rate
3.25% notes due 17 September 2023, principal USD 0.75 billion,
outstanding USD 0.39 billion (ISIN: US771196BN10) 3.32% 4.08% – 349 354
0.45% notes due 5 March 2024, principal USD 0.5 billion (ISIN: US771196BQ41) 0.49% 2.75% 418 437 451
1.882% notes due 8 March 2024, principal USD 1.25 billion (ISIN: US771196BU52) 1.95% n/a 1,055 1,153 –
3.35% notes due 30 September 2024, principal USD 1.65 billion,
outstanding USD 0.59 billion (ISIN: US771196BE11) 3.40% n/a 497 544 538
2.132% notes due 10 March 2025, principal USD 1.0 billion (ISIN: US771196BT89) 2.19% n/a 844 922 –
3.0% notes due 10 November 2025, principal USD 1.0 billion,
outstanding USD 0.51 billion (ISIN: US771196BJ08) 3.14% n/a 426 466 461
0.991% notes due 5 March 2026, principal USD 0.65 billion (ISIN: US771196BS07) 1.03% 4.07% 510 539 582
2.625% notes due 15 May 2026, principal USD 1.0 billion (ISIN: US771196BK70) 2.78% n/a 842 919 909
5.265% notes due 13 November 2026, principal USD 1.1 billion (ISIN: US771196CE02) 5.38% n/a 927 – –
2.375% notes due 28 January 2027, principal USD 0.85 billion (ISIN: US771196BL53) 2.54% n/a 715 781 771
2.314% notes due 10 March 2027, principal USD 1.25 billion (ISIN: US771196BV36) 2.37% n/a 1,054 1,152 –
3.625% notes due 17 September 2028, principal USD 0.65 billion
(ISIN: US771196BP67) 3.69% n/a 548 599 593
5.338% notes due 13 November 2028, principal USD 1.25 billion
(ISIN: US771196CF76) 5.45% n/a 1,053 – –
1.93% notes due 13 December 2028, principal USD 2.0 billion (ISIN: US771196BW19) 1.97% n/a 1,686 1,843 1,824
5.489% notes due 13 November 2030, principal USD 1.25 billion
(ISIN: US771196CG59) 5.60% n/a 1,053 – –
2.076% notes due 13 December 2031, principal USD 2.0 billion (ISIN: US771196BX91) 2.11% 2.16% 1,685 1,842 1,823
5.593% notes due 13 November 2033, principal USD 1.6 billion (ISIN: US771196CH33) 5.71% n/a 1,347 – –
7.0% notes due 1 March 2039, principal USD 2.5 billion, outstanding USD 1.12 billion
(ISIN: USU75000AN65 and US771196AU61) 7.43% 7.39% 916 1,001 990
4.0% notes due 28 November 2044, principal USD 0.65 billion (ISIN: US771196BH42) 4.16% n/a 541 591 585
2.607% notes due 13 December 2051, principal USD 2.0 billion (ISIN: US771196BY74) 2.65% 2.74% 1,680 1,838 1,818
US dollar notes – floating rate

Notes due 11 September 2023, principal USD 0.75 billion (ISIN: US771196BZ40) 3.90% n/a – 692 –
Notes due 5 March 2024, principal USD 0.35 billion (ISIN: US771196BR24) 2.86% n/a 295 323 319
Notes due 10 March 2025, principal USD 0.75 billion (ISIN: US771196CA89) 4.99% n/a 633 692 –
Notes due 13 November 2026, principal USD 0.3 billion (ISIN: US771196CD29) 6.21% n/a 253 – –
Euro Medium Term Note programme – fixed rate

0.5% notes due 27 February 2023, principal EUR 0.65 billion (ISIN: XS1371715118) 0.63% 0.67% – 639 672
5.375% notes due 29 August 2023, principal GBP 0.25 billion,
outstanding GBP 0.08 billion (ISIN: XS0175478873) 5.46% n/a – 85 95
0.875% notes due 25 February 2025, principal EUR 1.0 billion (ISIN: XS1195056079) 0.93% 1.11% 926 968 1,032
Euro bonds – fixed rate

3.312% bonds due 4 December 2027, principal EUR 0.6 billion (ISIN: XS2726331932) 3.35% n/a 560 – –
3.204% bonds due 27 August 2029, principal EUR 0.75 billion (ISIN: XS2592088236) 3.24% n/a 699 – –
3.355% bonds due 27 February 2035, principal EUR 0.5 billion (ISIN: XS2592088400) 3.38% n/a 466 – –
3.586% bonds due 4 December 2036, principal EUR 0.9 billion (ISIN: XS2726335099) 3.61% n/a 838 – –
Recognised liabilities and effective interest rates of bonds and notes in millions of CHF (continued)
Effective interest rate

Underlying Including
instrument hedging 2023 2022 2021
Swiss franc bonds – fixed rate
1.625% bonds due 23 September 2022, principal CHF 0.5 billion (ISIN: CH0180513183) 1.64% 1.39% – – 501
0.1% bonds due 23 September 2024, principal CHF 0.75 billion (ISIN: CH0358654975) 0.11% 0.61% 738 721 748
0.25% bonds due 24 September 2025, principal CHF 0.5 billion (ISIN: CH0433761308) 0.25% 0.52% 494 486 500
1.5% bonds due 23 June 2026, principal CHF 0.425 billion (ISIN: CH1211713222) 1.48% n/a 425 426 –
0.5% bonds due 25 February 2027, principal CHF 0.825 billion (ISIN: CH1166151899) 0.42% 0.48% 829 828 –
1.6% bonds due 15 September 2028, principal CHF 0.14 billion (ISIN: CH1305916764) 1.62% n/a 140 – –
0.45% bonds due 23 March 2029, principal CHF 0.35 billion (ISIN: CH0359915409) 0.46% n/a 350 350 350
0.75% bonds due 24 September 2030, principal CHF 0.4 billion (ISIN: CH0433761316) 0.74% n/a 400 400 400
0.75% bonds due 25 February 2031, principal CHF 0.625 billion (ISIN: CH1166151907) 0.71% n/a 627 627 –
2.0% bonds due 23 September 2032, principal CHF 0.375 billion (ISIN: CH1211713230) 2.00% n/a 375 375 –
1.0% bonds due 25 February 2037, principal CHF 0.3 billion (ISIN: CH1166151915) 0.91% n/a 303 304 –
Genentech Senior Notes

5.25% Senior Notes due 15 July 2035, principal USD 0.5 billion,
outstanding USD 0.29 billion (ISIN: US368710AC32) 5.39% n/a 243 266 263
Total bonds and notes 27,812 23,158 16,579
Bonds and notes maturity in millions of CHF
2023 2022 2021

Within one year 3,004 1,764 501
Between one and two years 3,322 3,179 1,121
Between two and three years 2,957 3,534 2,057
Between three and four years 3,157 1,883 1,993
Between four and five years 3,427 2,761 1,490
More than five years 11,945 10,037 9,417
Total bonds and notes 27,812 23,158 16,579
Unamortised discount included in carrying value of bonds and notes in millions of CHF
2023 2022 2021

US dollar notes 66 69 72
Euro notes and bonds 6 1 3
Swiss franc bonds (8) (9) 0
Total unamortised discount 64 61 75
Issuance of bonds and notes – 2023
On 27 February 2023 the Group completed an offering of EUR 0.75 billion fixed rate bonds with a coupon of 3.204% and
EUR 0.5 billion fixed rate bonds with a coupon of 3.355%. The bonds will mature on 27 August 2029 and 27 February 2035,
respectively. These bonds have a primary listing at the SIX Swiss Exchange. The Group received CHF 1,238 million aggregate
net proceeds from the issuance and sale of these fixed rate bonds.
On 13 November 2023 the Group completed an offering of USD 1.1 billion fixed rate notes with a coupon of 5.265%,
USD 1.25 billion fixed rate notes with a coupon of 5.338%, USD 1.25 billion fixed rate notes with a coupon of 5.489% and
USD 1.6 billion fixed rate notes with a coupon of 5.593%. The notes will mature on 13 November 2026, 13 November 2028,
13 November 2030 and 13 November 2033, respectively. The Group received CHF 4,684 million aggregate net proceeds
from the issuance and sale of these fixed rate notes.
Also on 13 November 2023 the Group completed an offering of USD 0.3 billion floating rate notes at a rate equal to the
Secured Overnight Financing Rate (SOFR) plus a margin of 0.74%, which will mature on 13 November 2026. The Group received
CHF 270 million aggregate net proceeds from the issuance and sale of these floating rate notes.
On 4 December 2023 the Group completed an offering of EUR 0.6 billion fixed rate bonds with a coupon of 3.312% and
EUR 0.9 billion fixed rate bonds with a coupon of 3.586%. The bonds will mature on 4 December 2027 and 4 December 2036,
respectively. These bonds have a primary listing at the SIX Swiss Exchange. The Group received CHF 1,415 million aggregate
net proceeds from the issuance and sale of these fixed rate bonds.
On 15 December 2023 the Group completed an offering of CHF 0.14 billion fixed rate bonds with a coupon of 1.6%,
CHF 0.19 billion fixed rate bonds with a coupon of 1.75% and CHF 0.23 billion fixed rate bonds with a coupon of 1.95%.
The bonds will mature on 15 September 2028, 15 September 2033 and 15 September 2038, respectively. These bonds are
listed at the SIX Swiss Exchange. The Group received CHF 560 million aggregate net proceeds from the issuance and sale of
these fixed rate bonds.
Issuance of bonds and notes – 2022
On 25 February 2022 the Group completed an offering of CHF 3.0 billion fixed rate bonds issued in four tranches, of which
CHF 1.25 billion for bonds with a zero coupon, CHF 0.825 billion for bonds with a coupon of 0.5%, CHF 0.625 billion for bonds
with a coupon of 0.75% and CHF 0.3 billion for bonds with a coupon of 1.0%. The zero coupon fixed rate bonds with a principal
amount of CHF 1.25 billion matured on 25 November 2022. The other bonds will mature on 25 February 2027, 25 February 2031
and 25 February 2037, respectively. These bonds are listed at the SIX Swiss Exchange. The Group received CHF 3,014 million
aggregate net proceeds from the issuance and sale of these fixed rate bonds.
On 10 March 2022 the Group completed an offering of USD 1.25 billion fixed rate notes with a coupon of 1.882%, USD 1.0 billion
fixed rate notes with a coupon of 2.132% and USD 1.25 billion fixed rate notes with a coupon of 2.314%. The notes will mature on
8 March 2024, 10 March 2025 and 10 March 2027, respectively. The Group received CHF 3,237 million aggregate net proceeds
from the issuance and sale of these fixed rate notes.
Also on 10 March 2022 the Group completed an offering of USD 0.75 billion floating rate notes at a rate equal to the Secured
Overnight Financing Rate (SOFR) plus a margin of 0.33%, which matured on 11 September 2023, and USD 0.75 billion floating
rate notes at a rate equal to the SOFR plus a margin of 0.56%, which will mature on 10 March 2025. The Group received
CHF 1,391 million aggregate net proceeds from the issuance and sale of these floating rate notes.
On 23 September 2022 the Group completed an offering of CHF 0.8 billion fixed rate bonds issued in two tranches, of which
CHF 0.425 billion for bonds with a coupon of 1.5% and CHF 0.375 billion for bonds with a coupon of 2.0%. The bonds will mature
on 23 June 2026 and 23 September 2032, respectively. These bonds are listed at the SIX Swiss Exchange. The Group received
CHF 800 million aggregate net proceeds from the issuance and sale of these fixed rate bonds.
Redemption and repurchase of bonds and notes – 2023
On the due date of 27 February 2023 the Group redeemed the 0.5% fixed rate notes with principal amount of EUR 0.65 billion.
The cash outflow was CHF 645 million, plus accrued interest. The effective interest rate of these notes was 0.63%.
On the due date of 29 August 2023 the Group redeemed the 5.375% fixed rate notes with an outstanding amount of
GBP 0.08 billion. The cash outflow was CHF 86 million, plus accrued interest. The effective interest rate of these notes was
5.46%.
On the due date of 11 September 2023 the Group redeemed floating rate notes with principal amount of USD 0.75 billion.
The cash outflow was CHF 670 million, plus accrued interest. The effective interest rate of these notes was 3.90%.
On the due date of 17 September 2023 the Group redeemed the 3.25% fixed rate notes with an outstanding amount of
USD 0.39 billion. The cash outflow was CHF 350 million, plus accrued interest. The effective interest rate of these notes
was 3.32%.
Redemption and repurchase of bonds and notes – 2022
On the due date of 23 September 2022 the Group redeemed the 1.625% fixed rate bonds with a principal amount of
CHF 0.5 billion. The cash outflow was CHF 500 million, plus accrued interest. The effective interest rate of these bonds
was 1.64%.
On the due date of 25 November 2022 the Group redeemed the zero coupon fixed rate bonds with a principal amount of
CHF 1.25 billion. The cash outflow was CHF 1,250 million. The effective interest rate of these bonds was –0.45%.
Cash flows from issuance, redemption and repurchase of bonds and notes
Cash inflows from issuance of bonds and notes in millions of CHF
2023 2022
US dollar notes 4,954 4,628
Euro bonds 2,653 0
Swiss franc bonds 560 3,814
Total cash inflows from issuance of bonds and notes 8,167 8,442
Cash outflows from redemption and repurchase of bonds and notes in millions of CHF
2023 2022
Euro Medium Term Note programme – Euro notes (645) 0
Euro Medium Term Note programme – Pound sterling notes (86) 0
US dollar notes (1,020) 0
Swiss franc bonds 0 (1,750)
Total cash outflows from redemption and repurchase of bonds and notes (1,751) (1,750)
Commercial paper
Roche Holdings, Inc. commercial paper program. Roche Holdings, Inc. has an established commercial paper program under
which it can issue up to USD 7.5 billion of unsecured commercial paper notes guaranteed by Roche Holding Ltd. The committed
credit line that is available as a back-stop supporting the commercial paper program is USD 7.5 billion at 31 December 2023
(2022: USD 7.5 billion). On 3 July 2019 the previously existing committed credit lines were refinanced by one new committed
credit line with an initial maturity of five years and two annual extension options, both of which were exercised extending
the maturity to 2026. The maturity of the notes under the program cannot exceed 365 days from the date of issuance. At
31 December 2023 unsecured commercial paper notes with a principal amount of USD 1.0 billion (2022: USD 1.9 billion) and an
average interest rate of 5.34% (2022: 4.18%) were outstanding.
Movements in commercial paper obligations in millions of CHF
2023 2022
At 1 January 1,755 500
Net cash proceeds (payments) (806) 1,293
At 31 December 848 1,755
Amounts due to banks and other financial institutions
At 31 December 2023 the amounts outstanding of CHF 547 million (2022: CHF 436 million, 2021: CHF 14,118 million) are due
within one year. These amounts are denominated in various currencies and the average interest rate was 3.30% (2022: 3.37%,
2021: 0.25%). At 31 December 2021 this position included the bridge loan facility drawn in December 2021 to finance the
share repurchase transaction (see Note 22). The bridge loan facility was fully repaid by May 2022, partly from the proceeds
from the new debt issuances and partly from internal cash generation. At 31 December 2021 the amount of the bridge loan
facility outstanding was CHF 13.5 billion. On 19 January 2024 the Group executed a short-term bridge facility agreement of
USD 5.0 billion with banks for general corporate purposes including but not limited to mergers and acquisitions and repayments
of maturing debts. The bridge facility has an initial maturity of six months and two extension options for three months each.
22. Equity attributable to Roche shareholders
Changes in equity attributable to Roche shareholders in millions of CHF

Share Retained Fair value Hedging Translation
c apital earnings reserves reserves reserves Total
At 1 January 2022 160 34,161 (60) (60) (9,712) 24,489
Net income recognised in income statement – 12,421 – – – 12,421
Financial assets at fair value through OCI

– Fair value gains (losses) – equity investments at fair value
through OCI – – 28 – – 28
– Fair value gains (losses) taken to retained earnings on disposal
of equity investments at fair value through OCI – 0 0 – – –
– Fair value gains (losses) – debt securities at fair value
through OCI – – (35) – – (35)
– Fair value gains (losses) transferred to income statement –
debt securities at fair value through OCI – – 0 – – 0
– Income taxes 5 – 0 4 – – 4
– Non-controlling interests – 0 1 – – 1
Cash flow hedges
– Gains (losses) taken to equity 31 – – – (238) – (238)
– Transferred to income statement 31 – – – 366 – 366
– Transferred to initial carrying amount of hedged items 31 – – – (218) – (218)
– Income taxes 5 – – – 28 – 28
– Non-controlling interests – – – 25 – 25
Currency translation of foreign operations
– Exchange differences – – 3 5 (1,723) (1,715)
– Accumulated differences transferred to income statement
on divestment of subsidiaries – – – – 12 12
– Non-controlling interests – – – – 522 522
– Remeasurement gains (losses) 26 – 2,372 – – – 2,372
– Limit on asset recognition 26 – (1,523) – – – (1,523)
– Income taxes 5 – (303) – – – (303)
– Non-controlling interests – (9) – – – (9)
Other comprehensive income, net of tax – 537 1 (32) (1,189) (683)
Total comprehensive income – 12,958 1 (32) (1,189) 11,738
Dividends – (7,446) – – – (7,446)

Share capital reduction (53) 53 – – – –
Equity compensation plans, net of transactions in own equity – (786) – – – (786)
Changes in non-controlling interests – (3) – – – (3)
At 31 December 2022 107 38,937 (59) (92) (10,901) 27,992
Changes in equity attributable to Roche shareholders in millions of CHF

Share Retained Fair value Hedging Translation
c apital earnings reserves reserves reserves Total
At 1 January 2023 107 38,937 (59) (92) (10,901) 27,992
Net income recognised in income statement – 11,498 – – – 11,498
Financial assets at fair value through OCI

– Fair value gains (losses) – equity investments at fair value
through OCI – – (72) – – (72)
– Fair value gains (losses) taken to retained earnings on disposal
of equity investments at fair value through OCI – (16) 16 – – –
– Fair value gains (losses) – debt securities at fair value
through OCI – – 13 – – 13
– Fair value gains (losses) transferred to income statement –
debt securities at fair value through OCI – – 0 – – 0
– Income taxes 5 – 4 4 – – 8
– Non-controlling interests – 1 (1) – – 0
Cash flow hedges
– Gains (losses) taken to equity 31 – – – (344) – (344)
– Transferred to income statement 31 – – – 437 – 437
– Transferred to initial carrying amount of hedged items 31 – – – (111) – (111)
– Income taxes 5 – – – 6 – 6
– Non-controlling interests – – – 5 – 5
Currency translation of foreign operations
– Exchange differences – – 2 9 (2,656) (2,645)
– Accumulated differences transferred to income statement
on divestment of subsidiaries – – – – 1 1
– Non-controlling interests – – – – 604 604
– Remeasurement gains (losses) 26 – (691) – – – (691)
– Limit on asset recognition 26 – 527 – – – 527
– Income taxes 5 – 41 – – – 41
– Non-controlling interests – (5) – – – (5)
Other comprehensive income, net of tax – (139) (38) 2 (2,051) (2,226)
Total comprehensive income – 11,359 (38) 2 (2,051) 9,272
Dividends – (7,590) – – – (7,590)

Equity compensation plans, net of transactions in own equity – (358) – – – (358)
Changes in non-controlling interests – (1) – – – (1)
At 31 December 2023 107 42,347 (97) (90) (12,952) 29,315
Share repurchase and share capital reduction
On 26 November 2021, an Extraordinary General Meeting of Roche shareholders approved a reduction of the share capital of
Roche Holding Ltd, which is the Group’s parent company, by CHF 53.3 million from CHF 160.0 million to CHF 106.7 million through
the cancellation of all such shares to be repurchased from Novartis. On 6 December 2021, the Roche Group repurchased
53.3 million Roche shares held by Novartis for a total consideration of CHF 19.0 billion. The repurchased shares were reported
as treasury shares as at 31 December 2021. These shares were cancelled in February 2022 when the necessary legal
procedures had been completed. Upon cancellation of these shares, the share capital of Roche Holding Ltd decreased by
CHF 53.3 million from CHF 160.0 million to CHF 106.7 million. The reduction in the share capital became effective at the
beginning of February 2022, with the entry of the share capital reduction in the commercial register of the Canton of Basel-
Stadt on 3 February 2022 and the publication of the share capital reduction in the Swiss Official Gazette of Commerce on
8 February 2022. The CHF 19.0 billion credit facility from banks drawn in 2021 to finance the share repurchase was fully repaid
by May 2022, partly from the proceeds from the new debt issuances and partly from internal cash generation.
Share capital
At 31 December 2023 the authorised and issued share capital of Roche Holding Ltd, which is the Group’s parent company,
consisted of 106,691,000 shares with a nominal value of CHF 1.00 each, as in the preceding year. The shares are bearer shares
and the Group does not maintain a register of shareholders. At 31 December 2023, based on the information available to the
Group, a shareholder group with pooled voting rights owned 69,318,000 shares representing 64.97% of the issued shares
(31 December 2022: 72,018,000 shares representing 67.50% of the issued shares). On 5 December 2019 the shareholder
group announced that it would continue the shareholder pooling agreement existing since 1948 with a modified shareholder
composition. The duration of the pool was extended for an indefinite period in 2009. At 31 December 2023, based on the
information available to the Group, Ms Maja Oeri, formerly a member of the pool, held 8,091,900 shares independently of the
pool, representing 7.58% of the issued shares (31 December 2022: 8,091,900 shares representing 7.58% of the issued shares).
This is further described in Note 32.
Non-voting equity securities (Genussscheine)
At 31 December 2023, 702,562,700 non-voting equity securities had been authorised and were in issue as in the preceding
year. Under Swiss company law these non-voting equity securities have no nominal value, are not part of the share capital and
cannot be issued against a contribution which would be shown as an asset in the balance sheet of Roche Holding Ltd. Each
non-voting equity security confers the same rights as any of the shares to participate in the net profit and any remaining proceeds
from liquidation following repayment of the nominal value of the shares and, if any, participation certificates. In accordance
with the law and the Articles of Incorporation of Roche Holding Ltd, the General Meeting of the company’s shareholders is
entitled at all times to exchange shares or participation certificates for all or some of the non-voting equity securities without
the consent of the bearers thereof.
Dividends
On 14 March 2023 the shareholders approved the distribution of a dividend of CHF 9.50 per share and non-voting equity
security (2022: CHF 9.30) in respect of the 2022 business year. The distribution to holders of outstanding shares and non-voting
equity securities totalled CHF 7,590 million (2022: CHF 7,446 million), which was recorded against retained earnings in 2023.
The Board of Directors has proposed dividends for the 2023 business year of CHF 9.60 per share and non-voting equity security.
This dividend proposal is subject to approval at the Annual General Meeting on 12 March 2024. If approved, this would result in
a total distribution to shareholders of CHF 7,769 million.
Own equity instruments
Holdings of own equity instruments in number of shares and non-voting equity securities
2023 2022
(millions) (millions)
Shares 0.5 0
Non-voting equity securities 11.5 10.1
Total 12.0 10.1
On 10 February 2023, the Group announced that it had acquired 540,000 shares for a total consideration of CHF 166 million.
The repurchased shares were initially reported as treasury shares subsequent to acquisition and will be used to cover current as
well as future obligations arising from equity compensation plans. This announcement followed from reports that a member of
a shareholder group with pooled voting rights sold 2.7 million Roche shares (see Note 32).
Own equity instruments are recorded within equity at original purchase cost. At 31 December 2023 the fair value of shares was
CHF 136 million (2022: CHF 7 million) and the fair value of non-voting equity securities was CHF 2.8 billion (2022: CHF 2.9 billion).
Own equity instruments are held for the Group’s potential conversion obligations that may arise from the Group’s equity
compensation plans (see Note 27).
Reserves
Fair value reserve. At 31 December 2023 and 2022 the fair value reserve represents the cumulative net change in the fair value
of financial assets at fair value through OCI until the asset is sold, impaired or otherwise disposed of.
Hedging reserve. The hedging reserve represents the effective portion of the cumulative net change in the fair value of cash flow
hedging instruments related to hedged transactions that have not yet occurred.
Translation reserve. The translation reserve represents the cumulative currency translation differences relating to the
consolidation of Group companies that use functional currencies other than Swiss francs.
23. Subsidiaries and associates
Chugai
Effective 1 October 2002 the Roche Group and Chugai completed an alliance to create a leading research-driven Japanese
pharmaceutical company, which was formed by the merger of Chugai and Roche’s Japanese pharmaceuticals subsidiary,
Nippon Roche. The merged company is known as Chugai.
Consolidated subsidiary. Chugai is a fully consolidated subsidiary of the Group. This is based on the Group’s interest in Chugai
at 31 December 2023 of 61.1% (2022: 61.1%) and the Roche relationship with Chugai that is founded on the Basic Alliance,
Licensing and Research Collaboration Agreements.
The common stock of Chugai is publicly traded and is listed on the Tokyo Stock Exchange under the stock code ‘TSE:4519’.
Chugai prepares financial statements in accordance with IFRS Accounting Standards that are filed on a quarterly basis with
the Tokyo Stock Exchange. Due to certain consolidation entries there are minor differences between Chugai’s stand-alone
IFRS results and the results of Chugai as consolidated by the Roche Group and included in these Annual Financial Statements.
Chugai summarised financial information in millions of CHF
2023 2022
Income statement
Sales 2 6,235 7,551
Other revenue 2 968 1,721
Total revenues 7,203 9,272
Operating profit 2 2,915 3,988
Balance sheet
Non-current assets 3,403 3,720
Current assets 8,207 9,329
Non-current liabilities (130) (171)
Current liabilities (1,717) (2,937)
Total net assets 9,763 9,941
Cash flows
Cash flows from operating activities 2,623 1,774
Cash flows from investing activities (239) (1,061)
Cash flows from financing activities (891) (1,058)
Dividends. The dividends distributed to third parties holding Chugai shares during 2023 totalled CHF 327 million
(2022: CHF 390 million) and were recorded against non-controlling interests (see Note 24). Dividends paid by Chugai to Roche
are eliminated on consolidation as intercompany items.
Roche’s relationship with Chugai. Chugai has entered into certain agreements with Roche, which are discussed below:
(1) Basic Alliance Agreement – As part of the Basic Alliance Agreement signed in December 2001 and partially revised in
July 2022, Roche and Chugai entered into certain arrangements covering the future operation and governance of Chugai.
Amongst other matters these cover the following areas:
∙ The structuring of the alliance.
∙ Roche’s rights as a shareholder.
∙ Roche’s rights to nominate members of Chugai’s Board of Directors.
∙ Certain limitations to Roche’s ability to buy or sell Chugai’s common stock.
Chugai issues additional shares of common stock in connection with its convertible debt and equity compensation plans, and
may issue additional shares for other purposes. If this occurs, Chugai will guarantee Roche’s right to maintain its shareholding
percentage in Chugai by allowing Roche to exercise its pre-emptive right or other rights.
(2) Licensing Agreements – Under the Japan Umbrella Rights Agreement signed in December 2001, Chugai has exclusive rights
to market Roche’s pharmaceutical products in Japan. Chugai has the right of first refusal on the development and marketing in
Japan of all development compounds advanced by Roche.
The Rest of the World Umbrella Rights Agreement (excluding Japan and South Korea) signed in May 2002 was revised and the
Amended and Restated Rest of the World Umbrella Rights Agreement (excluding Japan, South Korea and Taiwan) was signed
in August 2014. Under this Agreement Chugai shall offer and Roche has the right of first refusal on the development and
marketing of Chugai’s development compounds in markets outside Japan, excluding South Korea and Taiwan.
Further to these agreements, Roche and Chugai have signed a series of separate agreements for certain specific products.
Depending on the specific circumstances and the terms of the agreement, this may result in payments on an arm’s length basis
between Roche and Chugai, for any or all of the following matters:
∙ Upfront payments, if a right of first refusal to license a product is exercised.
∙ Milestone payments, dependent upon the achievement of agreed performance targets.
∙ Royalties on future product sales.
These specific product agreements may also cover the manufacture and supply of the respective products to meet the other
party’s clinical and/or commercial requirements on an arm’s length basis.
(3) Research Collaboration Agreements – Roche and Chugai have entered into research collaboration agreements in the areas
of small-molecule synthetic drug research and biotechnology-based drug discovery.
Associates
On 21 December 2021 the Group acquired an interest in Freenome Holdings, Inc. (‘Freenome’), a privately owned US company based
in South San Francisco, California. At 31 December 2023 the Group’s interest in Freenome was 15.9% (31 December 2022: 16.4%).
This investment has been assessed and is treated as an associate of the Group. The Group accounts for Freenome using the equity
method based on Freenome’s financial statements that are made available to the Group. The carrying value of the Group’s share
of Freenome’s net assets, an asset of CHF 242 million (31 December 2022: CHF 299 million), is included in other non-current
assets (see Note 15). The Group’s share of Freenome’s results, a loss of CHF 34 million (2022: a loss of CHF 40 million), is included
in other financial income (expense) (see Note 4). On 26 January 2024 the Group made a further investment of USD 50 million.
24. Non-controlling interests
Changes in equity attributable to non-controlling interests in millions of CHF
2023 2022
At 1 January 4,023 3,856
Net income recognised in income statement

– Chugai 844 1,093
– Other non-controlling interests 16 17
Total net income recognised in income statement 860 1,110
Equity investments at fair value through OCI 0 (1)

Debt securities at fair value through OCI 0 0
Cash flow hedges (5) (25)
Currency translation of foreign operations (604) (522)
Remeasurements of defined benefit plans 5 9
Other comprehensive income, net of tax (604) (539)
Total comprehensive income 256 571
Business combinations 0 0
Dividends to non-controlling shareholders
– Chugai 23 (327) (390)
– Other non-controlling interests (7) (16)
Equity compensation plans, net of transactions in own equity 2 (1)
Changes in non-controlling interests 1 3
At 31 December 3,948 4,023
Chugai 3,755 3,816

Other non-controlling interests 193 207
Total non-controlling interests 3,948 4,023
25. Employee benefits
Employee remuneration in millions of CHF
2023 2022
Wages and salaries 12,375 11,778
Social security costs 1,150 1,184
Defined contribution plans 26 469 452
Operating expenses for defined benefit plans 26 453 611
Equity compensation plans 27 830 738
Termination costs 7 425 (38)
Other employee benefits 756 1,307
Employee remuneration included in operating results 16,458 16,032
Net interest cost of defined benefit plans 26 150 82

Total employee remuneration 16,608 16,114
Other employee benefits consist mainly of life insurance schemes and certain other insurance schemes providing medical
coverage and other long-term and short-term disability benefits.
26. Pensions and other post-employment benefits
The Group’s objective is to provide attractive and competitive post-employment benefits to employees, while at the same
time ensuring that the various plans are appropriately financed and managing any potential impacts on the Group’s long-term
financial position. Most employees are covered by pension plans sponsored by Group companies. The nature of such plans
varies according to legal regulations, fiscal requirements and market practice in the countries in which the employees are
employed. Post-employment benefit plans are classified for IFRS Accounting Standards as ‘defined contribution plans’ if the
Group pays fixed contributions into a separate fund or to a third-party financial institution and will have no further legal or
constructive obligation to pay further contributions. All other plans are classified as ‘defined benefit plans’.
Defined contribution plans
Defined contribution plans are funded through payments by employees and by the Group to funds administered by third parties.
The Group’s expenses for these plans were CHF 469 million (2022: CHF 452 million). No assets or liabilities are recognised in
the Group’s balance sheet in respect of such plans, apart from regular prepayments and accruals of the contributions withheld
from employees’ wages and salaries and of the Group’s contributions. The Group’s major defined contribution plan is the US
Roche 401(k) Savings Plan.
Plans are usually established as trusts independent of the Group and are funded by payments from Group companies and by
employees. In some cases, notably for the major defined benefit plans in Germany, the plans are unfunded and the Group pays
pensions to retired employees directly from its own financial resources. Plans are usually governed by a senior governing body,
such as a Board of Trustees, which is typically composed of both employee and employer representatives. Funding of these
plans is determined by local regulations using independent actuarial valuations. Separate independent actuarial valuations are
prepared in accordance with the requirements of IAS 19 for use in the Group’s financial statements. The Group’s major pension
plans are located in Switzerland, the US and Germany, which in total account for 88% of the Group’s defined benefit obligation
(2022: 87%).
Pension plans in Switzerland. Current pension arrangements for employees in Switzerland are made through plans governed
by the Swiss Federal Occupational Old Age, Survivors and Disability Pension Act (‘BVG’). The Group’s pension plans are
administered by separate legal foundations, which are funded by regular employee and company contributions. The final
benefit is contribution based with certain minimum guarantees. Due to these minimum guarantees, the Swiss plans are
treated as defined benefit plans for the purposes of these financial statements prepared in accordance with IFRS Accounting
Standards, although they have many of the characteristics of defined contribution plans. Where there is an underfunding, this
may be remedied by various measures such as increasing employee and company contributions, lowering the interest rate on
retirement account balances, reducing prospective benefits and a suspension of the early withdrawal facility.
Pension plans in the US. The Group’s major defined benefit plans in the US have been closed to new members since 2007.
New employees in the US now join the defined contribution plan. The largest of the remaining defined benefit plans are funded
pension plans together with smaller unfunded supplementary retirement plans. The benefits are based on the highest average
annual rate of earnings during a specified period and length of employment. The plans are non-contributory for employees,
with the Group making periodic contributions to the plans. Where there is an underfunding, this would normally be remedied by
additional company contributions. In 2023 payments made by the Group were USD 98 million (2022: none).
Pension plans in Germany. The Group’s major pension arrangements in Germany are governed by the Occupational Pensions
Act (‘BetrAVG’). These plans are unfunded and the Group pays pensions to retired employees directly from its own financial
resources. These plans are non-contributory for employees. The benefits are based on final salary and length of employment.
These plans have been closed to new members since 2007. They have been replaced by a new plan which is funded by regular
employee and company contributions and administered through a contractual trust agreement. The final benefit of the
unfunded plan is contribution based with a minimum guarantee. Due to this minimum guarantee, this plan is treated as a defined
benefit plan for the purposes of these financial statements prepared in accordance with IFRS Accounting Standards, although
it has many of the characteristics of a defined contribution plan.
Pension plans in the Rest of the World. These represent approximately 8% of the Group’s defined benefit obligation (2022: 9%)
and consist of a number of smaller plans in various countries. Of these the largest are the pension plans at Chugai, which are
independently managed by Chugai, and the main pension plan in the United Kingdom. In 2023 no additional voluntary contributions
were made by Chugai to its pension plans (2022: voluntary contributions of JPY 1.3 billion). The Chugai plans are fully described
in Chugai’s own financial statements prepared in accordance with IFRS Accounting Standards. The UK pension plan had been
closed to new members since 2003 and was funded by regular employee and company contributions, with benefits based on final
salary and length of employment. This plan has been closed to future accruals from July 2023. The plan had been replaced with
a defined contribution plan.
Other post-employment benefit (‘OPEB’) plans. These represent approximately 4% of the Group’s defined benefit obligation
(2022: 4%) and consist of post-employment healthcare and life insurance schemes, mainly in the US. These plans are mainly
unfunded and/or are contributory for employees, with the Group reimbursing retired employees directly from its own financial
resources. The Group’s major OPEB plans in the US have been closed to new members since 2011. Part of the costs of these
plans is reimbursable under the Medicare Prescription Drug, Improvement, and Modernization Act of 2003. There is no statutory
funding requirement for these plans. The Group is funding these plans to the extent that it is tax efficient. In 2023 contributions
of USD 37 million were made by the Group to these plans (2022: contributions of USD 33 million). At 31 December 2023
the funding status under IFRS Accounting Standards was 73% (2022: 62%), including reimbursement rights, for the funded
OPEB plans in the US.
Defined benefit plans: income statement in millions of CHF
2023 2022
Other post- Other post-
Pension employment Total Pension employment Total
plans benefit plans expense plans benefit plans expense
Current service cost 447 9 456 618 12 630
Past service (income) cost (3) 0 (3) (19) 0 (19)
Settlement (gain) loss 0 0 0 0 0 0
Total operating expenses 444 9 453 599 12 611
Net interest cost of defined benefit plans 126 24 150 64 18 82

Total expense recognised in income statement 570 33 603 663 30 693
Funding status
The funding of the Group’s various defined benefit plans is the responsibility of the respective senior governing body, such
as a Board of Trustees, and the sponsoring employer, and is managed based on local statutory valuations, which follow the
legislation and requirements of the respective jurisdiction in which the plan is established. Qualified independent actuaries
carry out statutory actuarial valuations on a regular basis. The actuarial assumptions determining the funding status on
the statutory basis are regularly assessed by the local senior governing body. The funding status is closely monitored at
a corporate level. The unfunded plans are mainly those in the Group’s German affiliates, where the fully reserved pension
obligations are used for self-financing of the local affiliate’s operations.
The funding status on an IFRS basis of the Group’s funded defined benefit plans decreased to 110% (2022: 113%).
Reimbursement rights are linked to the post-employment medical plans in the US and represent the expected reimbursement of
the medical expenditure provided under the Medicare Prescription Drug, Improvement, and Modernization Act of 2003.
Defined benefit plans: funding status in millions of CHF
2023 2022
Pension employment Pension employment
plans benefit plans Total plans benefit plans Total
Funded plans
– Fair value of plan assets 16,781 302 17,083 16,317 281 16,598
– Defined benefit obligation (15,026) (469) (15,495) (14,202) (531) (14,733)
Over (under) funding 1,755 (167) 1,588 2,115 (250) 1,865
Unfunded plans
– Defined benefit obligation (3,697) (268) (3,965) (3,705) (296) (4,001)
Total funding status (1,942) (435) (2,377) (1,590) (546) (2,136)
Limit on asset recognition (1,032) 0 (1,032) (1,526) 0 (1,526)
Reimbursement rights – 49 49 – 58 58
Net recognised asset (liability) (2,974) (386) (3,360) (3,116) (488) (3,604)
Reported in balance sheet

– Defined benefit plan assets 970 49 1,019 899 58 957
– Defined benefit plan liabilities (3,944) (435) (4,379) (4,015) (546) (4,561)
Plan assets
The responsibility for the investment strategies of funded plans is with the respective senior governance body, such as the
Board of Trustees. Asset-liability studies are performed regularly for all major pension plans. These studies examine the
obligations from post-employment benefit plans and evaluate various investment strategies with respect to key financial
measures such as expected returns, expected risks, expected contributions, and expected funded status of the plan in an
interdependent way. The goal of an asset-liability study is to select an appropriate asset allocation for the funds held within
the plan. The investment strategy is developed to optimise expected returns, to manage risks and to contain fluctuations
in the statutory funded status. Asset-liability studies include strategies to match the cash flows of the assets with the plan
obligations. The Group currently does not use longevity swaps to manage longevity risk.
Plan assets are managed using internal and external asset managers. The actual performance is continually monitored by the
pension fund governance bodies as well as being closely monitored at a corporate level. In these financial statements the
difference between the interest income and actual return on plan assets is a remeasurement that is recorded directly to other
comprehensive income. In 2023 the actual return on plan assets was a gain of CHF 926 million (2022: loss of CHF 2,256 million),
which excludes the actual return on reimbursement rights.
Defined benefit plans: fair value of plan assets and reimbursement rights in millions of CHF
2023 2022
At 1 January 16,317 339 16,656 18,817 455 19,272
Interest income on plan assets and reimbursement rights 439 16 455 175 13 188
Remeasurements on plan assets and reimbursement rights 427 41 468 (2,364) (131) (2,495)
Employer contributions 519 37 556 429 32 461
Employee contributions 191 10 201 181 9 190
Benefits paid – funded plans (767) (7) (774) (776) (5) (781)
Benefits paid – settlements 0 0 0 0 0 0
Administration costs (4) (2) (6) (5) (2) (7)
At 31 December 16,781 351 17,132 16,317 339 16,656
The recognition of plan assets is limited to the present value of any economic benefits available from refunds from the plans or
reductions in future contributions to the plans. There was a limit on asset recognition as a result of a surplus, based on
current market assumptions, in certain Swiss pension plans that was not recognisable under IFRS Accounting Standards. The
movement of the limit on asset recognition included CHF 527 million recorded in other comprehensive income within equity
(2022: CHF 1,523 million) and CHF 33 million (2022: nil) as a reduction to interest income on plan assets in the income statement.
Defined benefit plans: limit on asset recognition in millions of CHF
2023 2022
Limit on asset recognition
At 1 January (1,526) (3)
Limitation of interest income relating to unrecognised plan assets (33) 0
Changes to limit on asset recognition 527 (1,523)
At 31 December (1,032) (1,526)
Fair value of plan assets at 31 December

Excluding limit on asset recognition 17,083 16,598
Limit on asset recognition (1,032) (1,526)
Including limit on asset recognition 16,051 15,072
Defined benefit plans: composition of plan assets in millions of CHF
2023 2022
Equity securities 5,325 4,833
Debt securities 6,425 6,217
Property 2,623 2,799
Cash and money market instruments 353 312
Other investments 2,357 2,437
At 31 December 17,083 16,598
Assets are invested in a variety of different classes in order to maintain a balance between risk and return as follows:
∙ Equity and debt securities which mainly have quoted market prices (Level 1 fair value hierarchy).
∙ Property which is primarily in private and commercial property funds which mainly have other observable inputs (Level 2 fair
value hierarchy).
∙ Cash and money market instruments which are mainly invested with financial institutions with a credit rating no lower than A.
∙ Other investments which mainly consist of alternatives, mortgages, commodities and insurance contracts. These are used for
risk management purposes and mainly have other observable inputs (Level 2 fair value hierarchy) and unobservable inputs
(Level 3 fair value hierarchy).
Included within the fair value of plan assets are the Group’s shares and non-voting securities with a fair value of CHF 165 million
(2022: CHF 147 million) and debt instruments issued by the Group with a fair value of CHF 15 million (2022: CHF 15 million).
Defined benefit obligation
The defined benefit obligation is calculated using the projected unit credit method. This reflects service rendered by employees
to the dates of valuation and incorporates actuarial assumptions primarily regarding discount rates used in determining the
present value of benefits, projected rates of remuneration growth and mortality rates. The present value of the defined benefit
obligation is determined by discounting the estimated future cash outflows using interest rates of high-quality corporate bonds
or government bonds in countries where there is not a deep market in corporate bonds. The corporate or government bonds
are denominated in the currency in which the benefits will be paid, and have maturity terms approximating to the terms of the
related pension obligation.
The Group’s final salary-based defined benefit pension plans in the US, Germany and the United Kingdom have been closed to
new participants. Active employees that had been members of these pension plans in the US and in Germany at the time these
were closed to new participants continue to accrue benefits in the final salary-based defined benefit pension plans. The UK
plan has been closed to future accruals in 2023. New employees in the US and UK now join the Group’s defined contribution
plans, while new employees in Germany join the contribution-based plan with a minimum guarantee. As a result, the proportion
of the defined benefit obligation which relates to these closed plans is expected to decrease in the future. The defined benefit
pension plans in Switzerland, where the final benefit is contribution based with a minimum guarantee, remain open to new
employees.
Defined benefit plans: defined benefit obligation in millions of CHF
2023 2022
At 1 January 17,907 827 18,734 22,820 1,054 23,874
Current service cost 447 9 456 618 12 630
Interest cost 532 40 572 239 31 270
Remeasurements:
– Demographic assumptions (48) 0 (48) 266 0 266
– Financial assumptions 1,000 (11) 989 (5,385) (252) (5,637)
– Experience adjustments 215 3 218 488 12 500
Employee contributions 191 10 201 181 9 190
Benefits paid – funded plans (767) (7) (774) (776) (5) (781)
Benefits paid – unfunded plans (178) (9) (187) (183) (11) (194)
Benefits paid – settlements 0 0 0 0 0 0
Past service (income) cost (3) 0 (3) (19) 0 (19)
Settlement (gain) loss 0 0 0 0 0 0
At 31 December 18,723 737 19,460 17,907 827 18,734
Composition of plans
Active members 9,744 182 9,926 9,149 206 9,355
Deferred vested members 1,364 4 1,368 1,320 4 1,324
Retired members 7,615 551 8,166 7,438 617 8,055
At 31 December 18,723 737 19,460 17,907 827 18,734
Plans by geography
Switzerland 10,295 – 10,295 9,304 – 9,304
United States 3,239 711 3,950 3,467 796 4,263
Germany 3,669 – 3,669 3,517 – 3,517
Rest of the World 1,520 26 1,546 1,619 31 1,650
At 31 December 18,723 737 19,460 17,907 827 18,734
Duration in years 12.3 9.7 12.2 12.6 10.0 12.4

Actuarial assumptions
The actuarial assumptions used in these financial statements are based on the requirements set out in IAS 19 ‘Employee
Benefits’. They are unbiased and mutually compatible estimates of variables that determine the ultimate cost of providing post-
employment benefits. They are set on an annual basis by local management, based on advice from actuaries, and are subject
to approval by corporate management and the Group’s actuaries. Actuarial assumptions consist of demographic assumptions
on matters such as mortality and employee turnover, and financial assumptions on matters such as interest rates, salary and
benefit levels, inflation rates and costs of medical benefits. The actuarial assumptions vary based upon local economic and
social conditions. The actuarial assumptions used in the various statutory valuations may differ from these based on local legal
and regulatory requirements.
Demographic assumptions. The most significant demographic assumptions relate to mortality rates. The Group’s actuaries use
mortality tables which take into account historic patterns and expected changes, such as further increases in longevity. Rates
of employee turnover, disability and early retirement are based on historical behaviour. The average life expectancy assumed
now for an individual at the age of 65 is as follows:
Defined benefit plans: average life expectancy at the age of 65 for major schemes in years
Male Female
Country Mortality table 2023 2022 2023 2022
Switzerland BVG 2020 projected with CMI model 21.8 21.7 23.5 23.5
United States Pri-2012 projected with MP-2021 22.0 21.9 23.4 23.3
Germany Heubeck tables 2018 G projected with CMI model 19.8 19.6 23.0 23.0
The mortality assumptions used for the pension plans in Switzerland were based on BVG 2020 applying the Continuous
Mortality Investigation (‘CMI’) model. A long-term rate of 1.25% (2022: 1.25%) was used for longevity improvements.
The Group used as mortality assumptions for the pension plans in Germany Heubeck tables 2018 G applying the CMI model with
a long-term rate of 1.25% for longevity improvements (2022: 1.25%).
Financial assumptions. These are based on market expectations for the period over which the obligations are to be settled.
The assumptions used in the actuarial valuations are shown below.
Defined benefit plans: financial actuarial assumptions
2023 2022
Weighted Weighted
average Range average Range
Discount rates 2.65% 1.40% – 5.60% 3.20% 1.23% – 5.30%
Expected rates of salary increases 2.42% 0.00% – 3.70% 2.69% 0.00% – 4.25%
Expected rates of pension increases 0.61% 0.00% – 3.00% 0.71% 0.00% – 3.00%
Expected inflation rates 2.16% 0.00% – 3.00% 2.26% 0.00% – 3.10%
Immediate medical cost trend rate 5.52% 5.50% – 6.22% 5.69% 5.49% – 5.70%
Ultimate medical cost trend rate (in 2044) 4.00% 4.00% – 4.00% 4.00% 4.00% – 4.00%
Discount rates are determined with reference to interest rates on high-quality corporate bonds or government bonds in
countries where there is not a deep market in corporate bonds. Expected rates of salary increases are based on expected
inflation rates with an adjustment to reflect the Group’s latest expectation of long-term real salary increases taking into
account expected inflation rates, amongst other factors. Expected rates of pension increases are generally linked to the
expected inflation rate or the funding status of the plan. Expected inflation rates are derived by looking at the level of inflation
implied by the financial markets in conjunction with the economists’ price inflation forecasts, historic price inflation as well as
other economic variables and circumstances. Medical cost trend rates take into account the benefits set out in the plan terms
and expected future changes in medical costs. Since the Group’s major post-employment medical plans are for US employees,
these rates are driven by developments in the US.
Sensitivity analysis. The measurement of the net defined benefit obligation is particularly sensitive to changes in the discount
rate, inflation rate, expected mortality and medical cost trend rate assumptions. The following table summarises the impact of a
change in those assumptions on the present value of the defined benefit obligation.
Defined benefit plans: sensitivity of defined benefit obligation to actuarial assumptions in millions of CHF
2023 2022
Increase (decrease) in defined benefit obligation
Life expectancy
– 1 year increase 482 464
Discount rates
– 0.25% increase (549) (550)
– 0.25% decrease 583 567
Expected inflation rates
– 0.25% increase 136 122
– 0.25% decrease (131) (168)
Immediate medical cost trend rate
– 1.00% increase 60 72
– 1.00% decrease (51) (61)
Each sensitivity analysis considers the change in one assumption at a time leaving the other assumptions unchanged.
This approach shows the isolated effect of changing one individual assumption but does not take into account that some
assumptions are related. The method used to carry out the sensitivity analysis is the same as in the prior year.
Cash flows
The Group incurred cash flows from its defined benefit plans as shown in the table below.
Defined benefit plans: cash flows in millions of CHF
2023 2022
Employer contributions, net of reimbursements – funded plans (556) (461)
Benefits paid – unfunded plans (187) (194)
Total cash inflows (outflows) (743) (655)
Based on the most recent actuarial valuations, the Group expects that employer contributions for funded plans in 2024 will
be approximately CHF 426 million, which includes an estimate of CHF 10 million of additional contributions related to the UK
pension plan. Benefits paid for unfunded plans in 2024 are estimated to be approximately CHF 216 million, which mostly relate
to the German defined benefit plans.
27. Equity compensation plans
The Group operates several equity compensation plans, including separate plans at Chugai. IFRS 2 ‘Share-based Payment’
requires that the fair value of all equity compensation plan awards granted to employees be estimated at grant date and
recorded as an expense over the vesting period.
Expenses for equity compensation plans in millions of CHF
2023 2022
Cost of sales 86 86
Research and development 385 330
Selling, general and administration 359 322
Total operating expenses 830 738
Equity compensation plans

Roche Stock-settled Stock Appreciation Rights 175 150
Roche Restricted Stock Unit Plan 602 538
Roche Connect 42 38
Roche Option Plan 1 1
Executive stock compensation 8 8
Chugai plans 2 3
Total operating expenses 830 738
Of which
– Equity-settled 830 738
– Cash-settled – –
Cash inflows (outflows) from equity compensation plans in millions of CHF
2023 2022
Roche Option Plan exercises 9 13
Chugai plans’ exercises 2 4
Roche Connect costs (42) (38)
Transactions in own equity (1,113) (1,236)
Total cash inflows (outflows) from equity-settled equity compensation plans,
net of transactions in own equity (1,144) (1,257)
The net cash outflows from transactions in own equity mainly arise from sales and purchases of equity instruments which are
held for the Group’s potential conversion obligations that may arise from the Group’s equity compensation plans (see Note 22).
Roche Stock-settled Stock Appreciation Rights. The Group issues Stock-settled Stock Appreciation Rights (S-SARs) to
certain directors, management and employees selected at the discretion of the Group. The S-SARs give employees the right
to receive non-voting equity securities reflecting the value of any appreciation in the market price of the non-voting equity
securities between the grant date and the exercise date. The Roche S-SAR Plan was renewed effective 1 January 2023 and
150 million S-SARs will be available for issuance over a ten-year period from 2023 to 2032. The rights, which are non-tradable
equity-settled awards, have a ten-year duration and vest on a phased basis over four years. Rights granted before 2019 have
a seven-year duration and vested on a phased basis over three years.
Roche S-SARs – movement in number of rights outstanding
2023 2022
Weighted average Weighted average
Number of rights exercise price Number of rights exercise price
(thousands) (CHF) (thousands) (CHF)
Outstanding at 1 January 29,865 294.14 28,535 277.00
Granted 9,979 261.21 6,308 358.53
Forfeited (1,859) 308.27 (1,147) 318.63
Exercised (2,102) 248.14 (3,807) 265.18
Expired (41) 251.50 (24) 258.44
Outstanding at 31 December 35,842 286.99 29,865 294.14
– of which exercisable 17,629 278.55 14,270 261.91
Roche S-SARs – terms of rights outstanding at 31 December 2023
Rights outstanding Rights exercisable

Weighted average
remaining Weighted average Weighted average
Number outstanding contractual life exercise price Number exercisable exercise price
Year of grant (thousands) (years) (CHF) (thousands) (CHF)
2017 2,469 0.26 251.49 2,469 251.49
2018 3,608 1.26 221.32 3,608 221.32
2019 3,769 5.27 272.27 3,769 272.27
2020 5,194 6.27 308.26 3,608 308.27
2021 5,772 7.27 308.15 2,703 308.32
2022 5,500 8.27 358.45 1,386 358.36
2023 9,530 9.26 261.20 86 261.80
Total 35,842 6.51 286.99 17,629 278.55
Roche Restricted Stock Unit Plan. The Group issues Restricted Stock Units (RSUs) awards to certain directors, management
and employees selected at the discretion of the Group. The RSUs, which are non-tradable, represent the right to receive non-
voting equity securities. RSUs vest on a phased basis over four years, subject to performance conditions, if any. There are
currently no performance conditions on outstanding RSUs at 31 December 2023. The Roche RSU Plan was renewed effective
1 January 2023 and 30 million non-voting equity securities will be available for issuance over a ten-year period from 2023
to 2032. The Roche RSU Plan also includes a value adjustment which will be an amount equivalent to the sum of shareholder
distributions made by the Group during the vesting period attributable to the number of non-voting equity securities for which
an individual award has been granted.
Roche RSUs – movement in number of awards outstanding
2023 2022
Number of awards Number of awards
(thousands) (thousands)
Outstanding at 1 January 3,812 3,613
Granted 2,775 1,943
Forfeited (351) (353)
Transferred to participants (1,811) (1,391)
Outstanding at 31 December 4,425 3,812
– of which vested and transferable 1 1
Roche Connect. This programme enables all employees worldwide, except for those in the US and certain other countries,
to make regular deductions from their salaries to purchase non-voting equity securities. It is administered by independent
third parties. The Group contributes to the programme, which allows the employees to purchase non-voting equity securities
at a discount (usually 20%). The administrators purchase the necessary non-voting equity securities directly from the market.
At 31 December 2023 the administrators held 4.2 million non-voting equity securities (2022: 3.7 million). In 2023 the cost of
the plan was CHF 42 million (2022: CHF 38 million).
Roche Option Plan. This programme is used in countries where S-SARs are not used. Awards under this plan give employees
the right to purchase non-voting equity securities at an exercise price specified at the grant date. The options, which are
non-tradable equity-settled awards, have a ten-year duration and vest on a phased basis over four years. Options granted
before 2019 have a seven-year duration and vested on a phased basis over three years.
Roche Option Plan – movement in number of options outstanding
2023 2022
Weighted average Weighted average
Number of options exercise price Number of options exercise price
(thousands) (CHF) (thousands) (CHF)
Outstanding at 1 January 259 266.66 294 258.47
Granted 22 261.19 20 359.29
Forfeited (8) 299.98 (3) 316.70
Exercised (39) 251.81 (52) 252.59
Expired (1) 251.50 0 256.10
Outstanding at 31 December 233 267.54 259 266.66
– of which exercisable 183 258.34 191 250.32
Roche Option Plan – terms of options outstanding at 31 December 2023
Options outstanding Options exercisable

Weighted average
remaining Weighted average Weighted average
Number outstanding contractual life exercise price Number exercisable exercise price
Year of grant (thousands) (years) (CHF) (thousands) (CHF)
2017 36 0.28 250.95 36 250.95
2018 63 1.28 223.05 63 223.05
2019 53 5.25 271.65 52 271.65
2020 20 6.25 308.01 15 308.01
2021 23 7.29 311.98 12 311.85
2022 16 8.25 359.21 5 359.26
2023 22 9.26 261.18 0 n/a
Total 233 4.26 267.54 183 258.34
The weighted average share price of Roche non-voting equity securities during the year was CHF 265.94 (2022: CHF 333.29).
Executive stock compensation. The Chairman of the Board of Directors until April 2023, Dr Franz, and the Chief Executive
Officer will be granted Bonus Stock Awards in lieu of their cash-settled bonus for the financial year 2023. These are subject
to approval by the 2024 Annual General Meeting in March 2024 and will be issued in March 2024. From April 2023, the new
Chairman of the Board of Directors, Dr Schwan, received part of his base salary in the form of shares blocked for ten years.
The number of awards and fair value per award are calculated at the grant date.
Fair value measurement
The inputs used in the measurement of the fair values at grant date of the equity compensation plans were as follows:
Fair value measurement in 2023

Roche Stock-settled Roche Restricted Roche
Stock Appreciation Rights Stock Unit Plan Option Plan
Vesting period Progressively over 4 years Progressively over 4 years Progressively over 4 years
Contractual life 10 years n/a 10 years
Number granted during year (thousands) 9,979 2,775 22
Weighted average fair value (CHF) 21 261 21
Model used Binomial Market price a) Binomial
Inputs to option pricing model
– Share price at grant date (CHF) 261 261 261
– Exercise price (CHF) 261 – 261
– Expected volatility b) 19.58% n/a 19.58%
– Expected dividend yield 7.00% n/a 7.00%
– Early exercise factor c) 1.348 n/a 1.348
– Expected exit rate 8.40% n/a 8.40%
a) The fair value of the Roche RSUs is equivalent to the share price on the date of grant.
b) Volatility was determined primarily by reference to historically observed prices of the underlying equity. Risk-free interest rates are derived from zero coupon swap rates
at the grant date taken from Datastream.
c) The early exercise factor describes the ratio between the expected market price at the exercise date and the exercise price at which early exercises can be expected,
based on historically observed behaviour.
28. Leases
The Group as a lessee
The Group enters into leasing transaction as a lessee mainly for reasons of convenience and flexibility. The Group has good
cash generation ability and it enjoys strong long-term investment grade credit ratings. Therefore it typically does not enter into
leasing arrangements for financing considerations. The main areas of leases that the Group has entered into are for:
∙ Property – offices and apartments. These are a small number of leases, but represent most of the value.
∙ Cars – mostly for sales representatives.
∙ Office equipment – photocopiers and similar.
The right-of-use assets reported for the Group’s leases are shown in the table below.
Right-of-use assets: movements in carrying value of assets in millions of CHF

Buildings and land Machinery and
Land improvements equipment Total
At 1 January 2022 49 1,040 160 1,249
Additions 40 179 119 338
Disposals 0 (35) (12) (47)
Reclassification to assets held for sale 6 0 0 0 0
Depreciation charge (3) (248) (90) (341)
Impairment reversal (charge) 0 (5) 0 (5)
Other 1 (28) 0 (27)
At 31 December 2022 85 880 168 1,133
Cost 101 1,543 325 1,969

Accumulated depreciation and impairment (16) (663) (157) (836)
Net book value 85 880 168 1,133

At 1 January 2023 85 880 168 1,133
Additions 2 777 120 899
Disposals 0 (18) (20) (38)
Reclassification to assets held for sale 6 0 0 (8) (8)
Depreciation charge (4) (231) (90) (325)
Impairment reversal (charge) 0 (319) 0 (319)
Other 0 (21) 0 (21)
At 31 December 2023 76 982 157 1,215
Cost 94 1,953 314 2,361

Accumulated depreciation and impairment (18) (971) (157) (1,146)
Net book value 76 982 157 1,215
Classification of impairment reversal (charge) of right-of-use assets in millions of CHF
2023 2022
Cost of sales (3) 0
Research and development (23) 0
Selling, general and administration (293) (5)
Total impairment reversal (charge) (319) (5)
Impairment charges for right-of-use assets were mainly related to global restructuring plans (see Note 7). Included in the 2023
impairment charge was a write-off of CHF 287 million for right-of-use assets recorded by Foundation Medicine in relation to
its leased buildings in Boston and San Diego, US. The recoverable amount of CHF 224 million was determined using fair value
less costs of disposal calculations. These valuations were classified as a Level 3 fair value in the fair value hierarchy. A post-
tax discount rate of 3.5% was applied to the projected post-tax cash flows for the remaining contractual period of Foundation
Medicine’s leases of approximately 8 to 15 years.
Liabilities reported for the Group’s leases are shown in the table below.
Leases: movements in carrying value of recognised liabilities in millions of CHF
2023 2022
At 1 January 1,193 1,354
Increase from new lease arrangements 897 335
Repayment of lease liabilities (360) (419)
Disposals (43) (57)
Reclassification to liabilities directly associated with assets held for sale 6 (8) 0
Interest expense on lease liabilities 4 23 16
Other 0 (2)
At 31 December 1,573 1,193
Non-current lease liabilities 18 1,282 891

Current lease liabilities 19 291 302
Total lease liabilities 1,573 1,193
The maturity analysis of lease liabilities is given in Note 31 in the ‘Liquidity risk’ section.
Short-term leases and leases of low-value assets are accounted for using the recognition exemption permitted by IFRS 16.
Expenses for short-term leases are recognised on a straight-line basis. These mainly include short-term property leases for
employee apartments. The amount reported in 2023 was CHF 35 million (2022: CHF 36 million). Expenses for leases of low-value
assets are recognised on a straight-line basis. These mainly include certain office equipment. The amount reported in 2023
was CHF 11 million (2022: CHF 13 million).
Expenses for variable lease payments not included in the measurement of lease liabilities was CHF 36 million in 2023
(2022: CHF 38 million). In 2023 income from subleasing right-of-use assets was CHF 6 million (2022: CHF 3 million). In 2023 and
2022 the Group did not enter into any material sale and leaseback transactions.
The major cash flows in respect of leases where the Group is the lessee are shown in the table below.
Leases: cash flows in millions of CHF
2023 2022
Included in cash flows from operating activities (81) (87)
Included in cash flows from financing activities (362) (422)
Total lease payments (443) (509)
Cash flows from operating activities include cash flows from short-term leases, leases of low-value assets and variable lease
payments. Cash flows from financing activities include the payment of interest and the principal portion of lease liabilities as
well as prepayments made before the lease commencement date.
Leases committed and not yet commenced. In November 2021 Genentech entered into a binding lease agreement with a
third party for the lease of laboratory and office space in a building in South San Francisco, US, which is to be constructed by
the landlord at the location currently known as ‘751 Gateway’. According to the agreement Genentech is committed to lease
the building for seven years. The commencement date of the lease is currently expected to be in the first half of 2024. The
committed future cash outflows related to this agreement are estimated to be approximately USD 117 million based on current
assumptions.
The Group as a lessor
In the Diagnostics Division the Group enters into certain contracts which include placement of diagnostics instruments, supply
of reagents and other consumables, and servicing arrangements. Depending upon the term of the agreement, the instrument
placement may result in either a finance lease or an operating lease. The Group performs a thorough customer assessment
before new leasing agreements are signed. Usually the Group also retains rights to terminate or modify contracts if certain
conditions are not met.
Finance leases. Certain assets, mainly diagnostics instruments, are leased to third parties through finance lease arrangements.
Such assets are reported as receivables at an amount equal to the net investment in the lease. Income from finance leases is
recognised as sales at amounts that represent the fair value of the instrument, which approximates the present value of the
minimum lease payments under the arrangement. Finance income for finance lease arrangements longer than twelve months
is deferred and subsequently recognised based on a pattern that approximates the use of the effective interest method and
recorded in other revenue.
The following amounts were recorded as income in respect of finance leases.
Finance leases: selected items of income in millions of CHF
2023 2022
Selling profit as the difference between sales and cost of sales 4 7
Finance income on the net investment in the lease 6 6
Currently the Group does not have any income from the variable lease payments of finance leases. The carrying amount of the
net investment in finance leases reported as receivables was CHF 137 million (2022: CHF 144 million).
Finance leases: future minimum lease receipts under non-cancellable leases in millions of CHF
Present value of minimum

Gross investment in lease lease receipts
2023 2022 2023 2022
Within one year 56 58 51 52
Between one and two years 36 39 33 37
Between two and three years 25 29 23 26
Between three and four years 17 17 16 16
Between four and five years 10 9 9 9
More than five years 6 5 5 5
Total 150 157 137 145
Unearned finance income (13) (13) n/a n/a
Unguaranteed residual value n/a n/a 0 (1)
Net investment in lease 137 144 137 144
Operating leases. Certain assets, mainly diagnostics instruments, are leased to third parties through operating lease
arrangements. Income from operating leases is recognised as sales on a straight-line basis over the lease term or, when lease
revenue is entirely based on variable lease payments and subject to subsequent reagent sales, as the performance obligations
for reagents are satisfied.
Lease income in 2023 was CHF 707 million (2022: CHF 787 million) and was included in sales. Of this CHF 485 million
(2022: CHF 588 million) relates to variable lease payments not depending upon an index or rate.
Leased assets are reported within property, plant and equipment, as shown in the tables below.
Machinery and equipment subject to operating leases: movements in carrying value of assets in millions of CHF
2023 2022
Leased out Own use Total Leased out Own use Total
At 1 January
Cost 5,717 16,777 22,494 5,641 16,357 21,998
Accumulated depreciation and impairment (4,163) (11,101) (15,264) (4,014) (10,677) (14,691)
Net book value 1,554 5,676 7,230 1,627 5,680 7,307

At 1 January 1,554 5,676 7,230 1,627 5,680 7,307
Additions 824 132 956 711 235 946
Disposals (34) (41) (75) (43) (41) (84)
Transfers 7 605 612 3 1,124 1,127
Reclassification to assets held for sale 0 (184) (184) 0 0 0
Depreciation charge (636) (958) (1,594) (662) (1,034) (1,696)
Impairment reversal (charge) (2) (103) (105) 0 (35) (35)
Other (10) (52) (62) 1 (60) (59)
At 31 December 1,573 4,700 6,273 1,554 5,676 7,230
Cost 5,555 14,358 19,913 5,717 16,777 22,494

Accumulated depreciation and impairment (3,982) (9,658) (13,640) (4,163) (11,101) (15,264)
Net book value 1,573 4,700 6,273 1,554 5,676 7,230
Buildings and land improvements subject to operating leases: movements in carrying value of assets in millions of CHF
2023 2022
Leased out Own use Total Leased out Own use Total
At 1 January
Cost 0 19,806 19,806 0 18,175 18,175
Accumulated depreciation and impairment 0 (8,925) (8,925) 0 (8,289) (8,289)
Net book value 0 10,881 10,881 0 9,886 9,886

At 1 January 0 10,881 10,881 0 9,886 9,886
Additions 0 6 6 0 125 125
Disposals 0 (13) (13) 0 (6) (6)
Transfers 25 712 737 0 1,925 1,925
Reclassification to assets held for sale 0 (433) (433) 0 0 0
Depreciation charge (1) (828) (829) 0 (869) (869)
Impairment reversal (charge) 0 (207) (207) 0 0 0
Other 0 15 15 0 (2) (2)
Currency translation effects (1) (628) (629) 0 (178) (178)
At 31 December 23 9,505 9,528 0 10,881 10,881
Cost 25 17,908 17,933 0 19,806 19,806

Accumulated depreciation and impairment (2) (8,403) (8,405) 0 (8,925) (8,925)
Net book value 23 9,505 9,528 0 10,881 10,881
The undiscounted amounts expected to be received from non-cancellable operating leases are shown in the table below.
Operating leases: future minimum lease receipts under non-cancellable leases in millions of CHF
2023 2022
Within one year 191 172
Between one and two years 148 131
Between two and three years 107 99
Between three and four years 76 57
Between four and five years 52 28
More than five years 39 12
Total minimum receipts 613 499
29. Earnings per share and non-voting equity security
Basic earnings per share and non-voting equity security
2023 2022
Net income attributable to Roche shareholders (CHF millions) 11,498 12,421
Weighted average number of outstanding shares (millions) 107 112

Number of outstanding non-voting equity securities (millions) 22 703 703
Weighted average number of own shares and non-voting equity securities held (millions) (11) (15)
Weighted average number of outstanding shares and non-voting equity securities used to
calculate basic earnings per share (millions) 799 800
Basic earnings per share and non-voting equity security (CHF) 14.40 15.52
Diluted earnings per share and non-voting equity security
2023 2022
Net income attributable to Roche shareholders (CHF millions) 11,498 12,421
Increase in non-controlling interests’ share of Group net income, assuming all outstanding Chugai
stock options exercised (CHF millions) 0 (1)
Net income used to calculate diluted earnings per share (CHF millions) 11,498 12,420
Weighted average number of outstanding shares and non-voting equity securities (millions) 799 800
Adjustment for assumed exercise of equity compensation plans, where dilutive (millions) 5 8
calculate diluted earnings per share (millions) 804 808
Diluted earnings per share and non-voting equity security (CHF) 14.31 15.37
30. Statement of cash flows
Cash flows from operating activities
Cash flows from operating activities arise from the Group’s primary activities in the Pharmaceuticals and Diagnostics Divisions.
These are calculated using the indirect method by adjusting the Group’s operating profit for any operating income and
expenses that are not cash flows (for example depreciation, amortisation and impairment) in order to derive the cash generated
from operations. This and other operating cash flows are shown in the statement of cash flows. Operating cash flows also
include income taxes paid on all activities.
Cash generated from operations in millions of CHF
2023 2022
Net income 12,358 13,531
Add back non-operating (income) expense
– Financing costs 4 996 665
– Other financial (income) expense 4 320 484
– Income taxes 5 1,721 2,796
Operating profit 15,395 17,476
Depreciation of property, plant and equipment 8 2,423 2,565

Depreciation of right-of-use assets 28 325 341
Amortisation of intangible assets 10 716 938
Impairment of goodwill 9 591 0
Impairment of intangible assets 10 608 2,837
Impairment (reversal) of property, plant and equipment 8 350 123
Impairment (reversal) of right-of-use assets 28 319 5
Operating (income) expense for defined benefit plans 26 453 611
Operating expense for equity-settled equity compensation plans 27 830 738
Net (income) expense for provisions 572 514
Bad debt (reversal) expense 6 3
Inventory write-downs 643 509
Net (gain) loss on disposal of products (558) (612)
Other adjustments (56) (18)
Cash generated from operations 22,617 26,030
Cash flows from investing activities
Cash flows from investing activities are principally those arising from the Group’s investments in property, plant and equipment
and intangible assets, and from the acquisition and divestment of subsidiaries, associates and businesses. Cash flows
connected with the Group’s portfolio of marketable securities and other investments are also included, as are any interest
and dividend payments received in respect of these securities and investments. These cash flows indicate the Group’s net
reinvestment in its operating assets and the cash flow effects of business combinations and divestments, as well as the cash
generated by the Group’s other investments.
Interest received (paid) and dividends received on marketable securities and other investments in millions of CHF
2023 2022
Interest received (paid) 168 32
Dividends received 0 0
Total 168 32
Cash flows from financing activities
Cash flows from financing activities are primarily the proceeds from the issuance and repayment of the Group’s equity and
debt instruments. They also include interest payments and dividend payments on these instruments. Cash flows from short-term
financing are also included. These cash flows indicate the Group’s transactions with the providers of its equity and debt
financing. Cash flows from lease payments are also included within financing activities. Cash flows from short-term borrowings
are shown as a net movement, as these consist of a large number of transactions with short maturity.
Dividends paid in millions of CHF
2023 2022
Dividends to Roche shareholders (7,590) (7,446)
Dividends to non-controlling shareholders
– Chugai (327) (390)
– Other non-controlling interests (7) (16)
Increase (decrease) in dividends payable (1) 0
Dividend withholding tax (1) 20
Total (7,926) (7,832)
Liabilities arising from financing activities
Movements in carrying value of recognised assets (liabilities) in millions of CHF

Cash
Principal Derivative collateral
portion financial receivables
Interest of lease instruments, (payables),
Debt 21 payable 19 l iabilities net 16, 19, 31 net 16, 19, 31 Total
At 1 January 2022 (31,198) (102) (1,353) (73) (17) (32,743)
Cash flows
– Outflows (inflows) 5,698 557 405 327 199 7,186
Non-cash changes
– Financing costs (4) (588) (16) 0 0 (608)
– Business combinations 0 0 0 0 0 0
– Asset acquisitions 0 0 0 0 0 0
– Fair value and other 136 (8) (262) (735) 0 (869)
– Foreign exchange rates 17 1 35 22 (2) 73
At 31 December 2022 (25,351) (140) (1,191) (459) 180 (26,961)

At 1 January 2023 (25,351) (140) (1,191) (459) 180 (26,961)
Cash flows
– Outflows (inflows) (5,785) 770 339 (32) (123) (4,831)
Non-cash changes
– Financing costs (8) (797) (23) 0 0 (828)
– Business combinations 0 0 0 0 0 0
– Asset acquisitions 0 0 0 0 0 0
– Fair value and other (88) (32) (824) 182 0 (762)
– Foreign exchange rates 2,023 12 129 37 (7) 2,194
At 31 December 2023 (29,209) (187) (1,570) (272) 50 (31,188)
Significant non-cash transactions
In 2023 there were no significant non-cash transactions (2022: none) except for the leasing transactions where the Group is a
lessee (see Note 28).
31. Risk management
Group risk management
Risk management is a fundamental element of the Group’s business practice on all levels and encompasses different types
of risks. At Group level, risk management is an integral part of the long-term forecasting and controlling processes. Material
risks are monitored and regularly discussed with the Corporate Executive Committee and the Audit Committee of the Board of
Directors.
Financial risk management
The Group is exposed to various financial risks arising from its underlying operations and corporate finance activities. The
Group’s financial risk exposures are predominantly related to changes in foreign exchange rates, interest rates and equity prices
as well as the creditworthiness and the solvency of the Group’s counterparties.
Financial risk management within the Group is governed by policies reviewed by the boards of directors of Roche and Chugai as
appropriate to their areas of statutory responsibility. These policies cover credit risk, liquidity risk and market risk. The policies
provide guidance on risk limits, types of authorised financial instruments and monitoring procedures. As a general principle, the
policies prohibit the use of derivative financial instruments for speculative trading purposes. Policy implementation and day-to-day
risk management are carried out by the relevant treasury functions and regular reporting on these risks is performed by the
relevant accounting and controlling functions within Roche and Chugai.
Credit risk
Credit risk arises from the possibility that counterparties to transactions may default on their obligations, causing financial
losses for the Group. The objective of managing counterparty credit risk is to prevent losses of liquid funds deposited with or
invested in such counterparties. The maximum exposure to credit risk resulting from financial activities, without considering
netting agreements and without taking account of any collateral held or other credit enhancements, is equal to the carrying
value of the Group’s financial assets.
The Group considers a financial asset to be in default when the counterparty is unlikely to pay its obligations to the Group in full.
In assessing whether a counterparty is in default, the Group considers both qualitative and quantitative indicators (e.g. overdue
status) that are based on data developed internally and for certain financial assets are also obtained from external sources.
A major part of the Group’s receivables which are past due more than 90 days relate to public customers. Risk of default of
public customers is considered low. The Group has reasonable and supportable information to demonstrate that a more lagging
default criterion is more appropriate for this particular customer segment.
Accounts receivable. At 31 December 2023 the Group had trade receivables of CHF 12.1 billion (2022: CHF 12.6 billion). These
are subject to a policy of active credit risk management which focuses on the assessment of country risk, credit availability,
ongoing credit evaluation and account monitoring procedures. The objective of trade receivables management is to maximise
the collection of unpaid amounts.
The Group uses an allowance matrix to estimate the allowance for doubtful accounts for all trade receivables. The expected
credit loss (‘ECL’) rate is based on the Group’s historical experience and the Group’s expectation of economic conditions over
the period until receivables are expected to be paid.
Customer credit risk exposure based on accounts receivable days overdue in millions of CHF
Overdue
Overdue Overdue more than Credit
Total Current 1–3 months 3–12 months 1 year impaired
At 31 December 2023
Gross carrying amount 11,461 9,594 748 428 656 35
Group’s expected credit loss rate 4% 0% 1% 7% 52% 100%
Allowance for doubtful accounts (440) (24) (11) (28) (342) (35)
At 31 December 2022
Gross carrying amount 12,096 10,373 708 369 604 42
Group’s expected credit loss rate 4% 0% 1% 8% 64% 100%
Allowance for doubtful accounts (490) (27) (6) (31) (384) (42)
At 31 December 2023 the Group’s combined trade receivables balance with three US national wholesale distributors,
McKesson Corp., Cencora, Inc. (formerly AmerisourceBergen Corp.) and Cardinal Health, Inc., was equivalent to CHF 3.7 billion
representing 31% of the Group’s consolidated trade receivables (2022: CHF 3.1 billion representing 25%). There is no other
significant concentration of counterparty credit risk due to the Group’s large number of customers and their wide geographical
spread. Risk limits and exposures are continuously monitored by country and by the nature of counterparties. The Group
obtains credit insurance and similar enhancements when appropriate to protect the collection of trade receivables.
At 31 December 2023 no collateral was considered to measure expected credit losses for trade receivables (2022: none).
The nature and geographic location of counterparties to accounts receivable that are not overdue or impaired are shown in the
table below. These include the balances with US national wholesalers described above.
Accounts receivable (not overdue), net of allowances for doubtful accounts and other allowances:
nature and geographical location of counterparties in millions of CHF
2023 2022
Whole Whole
salers/ salers/
Regions Total Public distributors Private Total Public distributors Private
Switzerland 379 135 142 102 291 69 167 55
Europe 1,395 513 402 480 1,609 594 376 639
North America 4,188 81 3,663 444 3,904 130 3,272 502
Latin America 609 131 231 247 584 122 233 229
Japan 1,198 5 1,183 10 2,236 1,091 1,135 10
Asia, Australia and Oceania 1,241 220 921 100 1,221 212 888 121
Rest of the World 560 137 228 195 501 125 199 177
Total 9,570 1,222 6,770 1,578 10,346 2,343 6,270 1,733
Cash and marketable securities (excluding equity securities). At 31 December 2023 the Group had cash and marketable
securities (excluding equity securities) of CHF 10.5 billion (2022: CHF 9.8 billion). These are subject to a policy of restricting
exposures to high-quality counterparties and setting defined limits for individual counterparties. These limits and counterparty
credit ratings are reviewed regularly.
Cash and cash equivalents are held with banks and financial institutions, which are predominantly rated as investment grade
(94% in 2023 and 95% in 2022), based on Moody’s and Standard & Poor’s ratings. Cash and short-term time deposits are subject
to rules which limit the Group’s exposure to individual financial institutions.
Impairment on cash and cash equivalents is measured on a 12-month expected credit losses (‘ECL’) basis with a reference to
external credit ratings of the counterparties. This reflects the short maturities of the exposures in cash and cash equivalents.
The Group considers that its cash and cash equivalents have low credit risk based on these external credit ratings.
Investments in marketable securities (excluding equity securities) are entered into on the basis of guidelines with regard to
liquidity, quality and maximum amount. As a general rule, the Group invests only in high-quality securities with adequate liquidity
and with counterparties that have a credit rating of at least Baa3 from Moody’s and BBB- from Standard & Poor’s.
The credit risk of the counterparties with external ratings below investment grade or with no rating is closely monitored and
reviewed on an individual basis.
Rating analysis of cash and marketable securities (excluding equity securities) – market values in millions of CHF
2023 2022
Fair value Fair value
through OCI Amortised costs through OCI Amortised costs
Total (12-month ECL) (12-month ECL) Total (12-month ECL) (12-month ECL)
AAA range 1,254 954 300 2,123 2,123 0
AA range 910 134 776 1,021 121 900
A range 7,604 1,435 6,169 5,946 1,754 4,192
BBB range 344 342 2 400 390 10
Total investment grade 10,112 2,865 7,247 9,490 4,388 5,102
Below BBB range (below investment grade) 64 5 59 77 5 72
Unrated 333 1 332 199 1 198
Total gross carrying amounts 10,509 2,871 7,638 9,766 4,394 5,372
Loss allowance a) 1 0 1 1 0 1
a) The loss allowance related to fair value through OCI does not affect the carrying amount of marketable securities (excluding equity securities) but is booked against
corresponding OCI reserve instead.
Debt securities at amortised cost and those at fair value through OCI are investment grade and therefore considered to be low
risk, and thus the impairment allowance is determined at 12-month expected credit losses (‘ECL’) with a reference to external
credit ratings of the counterparties. There were no debt securities for which the Group observed a significant increase in the
credit risk which would require the application of the lifetime expected credit losses impairment model. In addition, there were
no material movements in the loss allowance in 2023 and 2022, respectively.
Master netting agreements. The Group enters into derivative transactions and collateral agreements under International
Swaps and Derivatives Association (ISDA) master netting agreements with the respective counterparties in order to mitigate
counterparty risk. Under such agreements the amounts owed by each counterparty on a single day in respect of all transactions
outstanding in the same currency are aggregated into a single net amount that is payable by one party to the other. The ISDA
agreements do not meet the criteria for offsetting in the balance sheet as the Group does not have a currently enforceable
right to offset recognised amounts, because the right to offset is only enforceable on the occurrence of future events, such as
a default or other credit events.
Contract terms. At 31 December 2023 there were no significant financial assets whose terms had been renegotiated
(2022: none).
Impairment losses on financial assets excluding equity investments/securities. During 2023 there were no impairment losses
(2022: none).
Liquidity risk
Liquidity risk arises through a surplus of financial obligations over available financial assets due at any point in time. The
Group’s approach to liquidity risk is to maintain sufficient readily available reserves in order to meet its liquidity requirements
at any point in time. Roche and Chugai enjoy strong credit quality and are rated by at least one major credit rating agency.
The ratings will permit efficient access to the international capital markets in the event of major financing requirements. At
31 December 2023 the Group had an unused committed credit line with various financial institutions totalling CHF 6.6 billion
(2022: CHF 7.2 billion), of which CHF 6.3 billion (2022: CHF 6.9 billion) serve as a back-stop line for the commercial paper
program. On 3 July 2019 the previously existing committed credit lines were refinanced by one new committed credit line with
an initial maturity of five years and two annual extension options, both of which were exercised extending the maturity to 2026.
On 19 January 2024 the Group executed a short-term bridge facility agreement of USD 5.0 billion (CHF 4.2 billion) with banks
for general corporate purposes including but not limited to mergers and acquisitions and repayments of maturing debts. The
bridge facility has an initial maturity of six months and two extension options for three months each.
The remaining undiscounted cash flow contractual maturities of financial liabilities, including estimated interest payments, are
shown in the table below.
Contractual maturities of financial liabilities in millions of CHF

Less than
Carrying value Total 1 year 1–2 years 2–5 years Over 5 years
At 31 December 2023
Debt 21
– Bonds and notes 27,812 35,231 4,616 4,038 11,326 15,251
– Other debt 1,397 1,397 1,397 0 0 0
Contingent consideration 20 95 106 35 13 38 20
Accounts payable 17 4,325 4,325 4,325 – – –
Other non-current liabilities 18 1,541 1,708 – 504 481 723
– of which lease liabilities 1,282 1,449 – 260 478 711
Other current liabilities 19 12,150 12,173 12,079 55 39 0
– of which lease liabilities 291 314 314 – – –
– of which derivative financial instruments 420 420 326 55 39 0
Liabilities directly associated with assets held for sale 6 8 8 8 – – –
Total financial liabilities 47,328 54,948 22,460 4,610 11,884 15,994
At 31 December 2022
Debt 21
– Bonds and notes 23,158 28,153 2,264 3,671 9,319 12,899
– Other debt 2,193 2,193 2,193 0 0 0
Contingent consideration 20 103 116 38 47 9 22
Accounts payable 17 4,556 4,556 4,556 – – –
Other non-current liabilities 18 1,189 1,258 – 530 386 342
– of which lease liabilities 891 960 – 249 383 328
Other current liabilities 19 13,288 13,301 13,150 61 90 0
– of which lease liabilities 302 315 315 – – –
– of which derivative financial instruments 626 626 475 61 90 0
Liabilities directly associated with assets held for sale 6 0 0 0 – – –
Total financial liabilities 44,487 49,577 22,201 4,309 9,804 13,263
Take-or-pay commitments. The Group has entered into contract manufacturing agreements with various companies to
further develop manufacturing capacity and flexibility, mainly in the Pharmaceuticals Division. There are future minimum take-
or-pay commitments within some of these agreements with a total potential commitment from the Group of CHF 1.7 billion at
31 December 2023 (2022: CHF 1.9 billion).
Commitments for capital calls. The Group holds investments in funds reported as debt investment at fair value through profit
or loss in which it has committed to invest further upon future capital calls. As of 31 December 2023 the total uncalled capital
commitments for the Group’s investments in funds amounted to CHF 72 million (2022: CHF 89 million).
Market risk
Market risk arises from changing market prices, mainly foreign exchange rates and interest rates, of the Group’s financial assets
or financial liabilities which affect the Group’s financial result and equity.
Value-at-Risk. The Group uses Value-at-Risk (VaR) to measure the impact of market risk on its financial instruments. VaR indicates
the value range within which a given financial instrument will fluctuate with a preset probability as a result of movements in
market prices. VaR is calculated using a historical simulation approach and for each scenario, all financial instruments are fully
valued and the total change in value and earnings is determined. VaR calculations are based on a 95% confidence level and
a holding period of 20 trading days over the past ten years. This holding period reflects the time required to change the
corresponding risk exposure, should this be deemed appropriate.
Actual future gains and losses associated with the Group’s treasury activities may differ materially from the VaR analyses due to
the inherent limitations associated with predicting the timing and amount of changes to interest rates, foreign exchange rates
and equity investment prices, particularly in periods of high market volatilities. Furthermore, VaR does not include the effect of
changes in credit spreads.
Market risk of financial instruments in millions of CHF
2023 2022
VaR – Interest rate component 440 234
VaR – Foreign exchange component 32 40
VaR – Other price component 38 54
Diversification (72) (67)
VaR – Total market risk 438 261
The interest rate component increased due to the bond issuances during 2023. The foreign exchange component was lower due
to a favourable exposure mix. The other price component decreased due to a lower balance of equity investments.
Foreign exchange risk
The Group uses the Swiss franc as its reporting currency and as a result is exposed to movements in foreign currencies, mainly
the US dollar, Japanese yen and euro. The Group’s foreign exchange risk management strategy is to preserve the economic
value of its current and future assets and to minimise the volatility of the Group’s financial result. The primary focus of the
Group’s foreign exchange risk management activities is on hedging transaction exposures arising through foreign currency flows
or monetary positions held in foreign currencies. The Group uses forward contracts and foreign exchange options to hedge
transaction exposures. Application of these instruments intends to continuously immunise against unfavourable developments
of foreign exchange rates.
Interest rate risk
The Group mainly raises debt on a fixed rate basis for bonds and notes. The Group is exposed to movements in interest rates,
mainly for its US dollar, Swiss franc and euro floating rate financial instruments and short-term debt. The Group’s interest rate
risk management strategy is to optimise the net interest result. The Group may use forward contracts, options and interest rate
swaps to hedge its interest rate exposures. Depending on the interest rate environment of major currencies, the Group will use
these instruments to generate an appropriate mix of fixed and floating rate exposures.
Other price risk
Other price risk arises mainly from movements in the prices of equity securities. The Group manages the price risk through
placing limits on individual and total equity investments. These limits are defined both as a percentage of total liquid funds and
as an absolute number for individual equity investments.
Capital management
The Group defines the capital that it manages as the Group’s total capitalisation, being the sum of debt plus equity, including
non-controlling interests. The Group’s objectives when managing capital are:
∙ To safeguard the Group’s ability to continue as a going concern, so that it can continue to provide benefits for patients and
returns to investors.
∙ To provide an adequate return to investors based on the level of risk undertaken.
∙ To have available the necessary financial resources to allow the Group to invest in areas that may deliver future benefits for
patients and returns to investors.
∙ To maintain sufficient financial resources to mitigate against risks and unforeseen events.
The capitalisation is reported to senior management as part of the Group’s regular internal management reporting and is shown
in the table below.
Capital in millions of CHF
2023 2022 2021

Capital and reserves attributable to Roche shareholders 22 29,315 27,992 24,489
Equity attributable to non-controlling interests 24 3,948 4,023 3,856
Total equity 33,263 32,015 28,345
Total debt 21 29,209 25,351 31,198
Capitalisation 62,472 57,366 59,543
The Group is not subject to regulatory capital adequacy requirements as known in the financial services industry. The Group
has a majority shareholding in Chugai (see Note 23). Chugai is a public company and its objectives, policies and processes for
managing its own capital are determined by Chugai management.
Financial instrument accounting classifications and fair values
The fair values of financial assets and liabilities, together with the carrying value shown in the consolidated balance sheet, are
as follows:
Carrying value and fair value of financial instruments – 2023 in millions of CHF
Financial
instruments
mandatorily Financial Financial
at fair value instruments Fair value – assets at Other Total
through profit at fair value hedging amortised f inancial carrying
or loss through OCI instruments cost l iabilities value Fair value
At 31 December 2023
Other non-current assets 15
– Equity and debt investments 298 249 – – – 547 547
– Other financial non-current assets – – – 114 – 114 114
Accounts receivable 12 – – – 11,021 – 11,021 11,021
Marketable securities 13
– Equity securities 1 – – – – 1 1
– Debt securities 0 512 – – – 512 512
– Money market instruments – 2,359 – – – 2,359 2,359
– Time accounts over three months – – – 2,262 – 2,262 2,262
Cash and cash equivalents 14 – – – 5,376 – 5,376 5,376
Other current assets 16
– Derivative financial instruments – – 148 – – 148 148
– Other financial current assets – – – 897 – 897 897
Total financial assets 299 3,120 148 19,670 – 23,237 23,237
Debt 21
– Bonds and notes – – – – (27,812) (27,812) (27,081)
– Other debt – – – – (1,397) (1,397) (1,397)
Contingent consideration 20 (95) – – – – (95) (95)
Accounts payable 17 – – – – (4,325) (4,325) (4,325)
Other non-current liabilities 18 – – – – (1,541) (1,541) (1,541)
Other current liabilities 19 – – (420) – (11,730) (12,150) (12,150)
Liabilities directly associated with
assets held for sale 6 – – – – (8) (8) (8)
Total financial liabilities (95) – (420) – (46,813) (47,328) (46,597)
Carrying value and fair value of financial instruments – 2022 in millions of CHF
Financial
instruments
mandatorily Financial Financial
at fair value instruments Fair value – assets at Other Total
through profit at fair value hedging amortised f inancial carrying
or loss through OCI instruments cost l iabilities value Fair value
At 31 December 2022
Other non-current assets 15
– Equity and debt investments 315 356 – – – 671 671
– Other financial non-current assets – – – 126 – 126 126
Accounts receivable 12 – – – 11,606 – 11,606 11,606
– Equity securities 1 – – – – 1 1
– Debt securities 0 583 – – – 583 583
– Money market instruments – 3,811 – – – 3,811 3,811
– Time accounts over three months – – – 381 – 381 381
Cash and cash equivalents 14 – – – 4,991 – 4,991 4,991
Other current assets 16
– Derivative financial instruments – – 167 – – 167 167
– Other financial current assets – – – 1,082 – 1,082 1,082
Total financial assets 316 4,750 167 18,186 – 23,419 23,419
Debt 21
– Bonds and notes – – – – (23,158) (23,158) (21,443)
– Other debt – – – – (2,193) (2,193) (2,193)
Contingent consideration 20 (103) – – – – (103) (103)
Accounts payable 17 – – – – (4,556) (4,556) (4,556)
Other non-current liabilities 18 – – – – (1,189) (1,189) (1,189)
Other current liabilities 19 – – (626) – (12,662) (13,288) (13,288)
Liabilities directly associated with
assets held for sale 6 – – – – 0 0 0
Total financial liabilities (103) – (626) – (43,758) (44,487) (42,772)
The fair value of bonds and notes is Level 1 and is calculated based on the observable market prices of the debt instruments or
the present value of the future cash flows on the instrument, discounted at a market rate of interest for instruments with similar
credit status, cash flows and maturity periods.
Fair value hierarchy
The table below analyses financial instruments carried at fair value, by valuation method. The different levels have been defined
as follows:
∙ Level 1 – quoted prices (unadjusted) in active markets for identical assets and liabilities.
∙ Level 2 – observable inputs other than quoted prices in active markets for identical assets and liabilities.
∙ Level 3 – unobservable inputs.
Fair value hierarchy of financial instruments in millions of CHF
Level 1 Level 2 Level 3 Total

At 31 December 2023
– Equity securities at fair value through profit or loss 1 – – 1
– Debt securities at fair value through OCI 506 6 – 512
– Money market instruments at fair value through OCI 250 2,109 – 2,359
Derivative financial instruments 16 – 148 – 148
Equity investments at fair value through OCI 15 241 8 – 249
Equity and debt investments at fair value through profit or loss 15 98 172 28 298
Financial assets recognised at fair value 1,096 2,443 28 3,567
Derivative financial instruments 19 – (420) – (420)

Contingent consideration 20 – – (95) (95)
Financial liabilities recognised at fair value – (420) (95) (515)
At 31 December 2022
– Equity securities at fair value through profit or loss 1 – – 1
– Debt securities at fair value through OCI 518 65 – 583
– Money market instruments at fair value through OCI 0 3,811 – 3,811
Derivative financial instruments 16 – 167 – 167
Equity investments at fair value through OCI 15 356 0 – 356
Equity and debt investments at fair value through profit or loss 15 114 179 22 315
Financial assets recognised at fair value 989 4,222 22 5,233
Derivative financial instruments 19 – (626) – (626)

Contingent consideration 20 – – (103) (103)
Financial liabilities recognised at fair value – (626) (103) (729)
Level 1 financial assets consisted of treasury bills, bonds and quoted shares. Level 2 financial assets consisted primarily of
commercial paper, certificates of deposit and derivative financial instruments.
The Group determines Level 2 fair values using the following valuation techniques:
∙ Marketable securities and derivative financial instruments are based on valuation models that use observable market data for
interest rates, yield curves, foreign exchange rates and implied volatilities for similar instruments at the measurement date.
∙ Equity and debt investments at fair value through OCI and at fair value through profit or loss are based on a valuation model
that uses the most recently published observable market data.
The Group recognises transfers between levels of the fair value hierarchy as at the end of the reporting period during which the
transfer occurred. There were no significant transfers between Level 1 and Level 2 and vice versa during the year (2022: none).
Level 3 fair values
Details of the determination of Level 3 fair value measurements are set out below.
Contingent consideration arrangements in millions of CHF
2023 2022
At 1 January (103) (141)
Arising from business combinations 0 0
Utilised for settlements 6 0 0
Total gains and losses included in the income statement
– Unused amounts reversed – recorded within other operating income (expense) 10 41
– Additional amount created – recorded within other operating income (expense) 0 (2)
– Discount unwind included in financing costs (6) 1
Total gains and losses included in other comprehensive income
– Currency translation effects 4 (2)
At 31 December (95) (103)
Contingent consideration arrangements
The Group is party to certain contingent consideration arrangements, including those from business combinations. The fair
values of contingent consideration from business combinations are determined considering the expected payments and, where
payments are expected to be made beyond the next 12 months, discounted to present value using a risk-adjusted average
discount rate of 4.9% (2022: 5.3%). The expected payments are determined by considering the possible scenarios of forecast
sales and other performance criteria, the amount to be paid under each scenario and the probability of each scenario. The
significant unobservable inputs are the forecast sales, other performance criteria and the risk-adjusted discount rate. The
estimated fair value would increase if the forecast sales or other performance criteria rates were higher or the risk-adjusted
discount rate was lower. At 31 December 2023 the total potential payments under contingent consideration arrangements
arising from business combinations could be up to CHF 0.3 billion (2022: CHF 0.4 billion) as follows:
Potential payments under contingent consideration arrangements in millions of CHF
Acquisition Year acquired Operating segment 2023 2022

Dutalys 2014 Roche Pharmaceuticals 186 203
Genia 2014 Diagnostics 137 150
Derivative financial instruments
Cash collateral agreements are in place with the counterparties to certain derivative financial instruments to mitigate
counterparty risk. The following table sets out the carrying value of derivative financial instruments and the amounts that are
subject to master netting agreements.
Derivative financial instruments in millions of CHF

Assets Liabilities
2023 2022 2021 2023 2022 2021
Foreign currency derivatives
– Forward exchange contracts 147 167 187 (352) (471) (242)
– Other 0 0 0 0 0 0
Interest rate derivatives
– Swaps 1 0 2 (68) (155) (20)
– Other 0 0 0 0 0 0
Other derivatives 0 0 0 0 0 0
Carrying value of derivative financial instruments 16, 19 148 167 189 (420) (626) (262)
Derivatives subject to master netting agreements (68) (92) (54) 68 92 54
Collateral arrangements 0 (12) (32) 50 192 15
Net amount 80 63 103 (302) (342) (193)
Collateral arrangements
Movements in cash collateral other receivable (accrued liability) in millions of CHF
2023 2022
At 1 January 180 (17)
Net cash delivered by (to) the Group (123) 199
Fair value and other 0 0
Hedge accounting
As described above the Group’s risk management strategy is to hedge the transaction exposures arising through foreign
currency flows or monetary positions held in foreign currencies as well as to generate an appropriate mix of fixed and floating
rate exposures. The level of hedging depends on market conditions and business requirements of the Group. The Group
designates a specific interest rate risk management objective to ensure that a predetermined level of its interest rate risk
exposure is at a floating rate.
Hedge effectiveness is determined at the inception of the hedge relationship, and through periodic prospective effectiveness
assessments at each reporting date to ensure that an economic relationship exists between the hedged item and the hedging
instrument. The Group performs a qualitative assessment of the hedge effectiveness using a critical terms match method.
As the critical terms of the hedged items and the hedging instruments match, the Group concludes that risks being hedged
for the hedged items and the hedging instruments are sufficiently aligned, that there is no inherent mismatch in the hedging
relationship and that a 100% hedge ratio applies both for the actual quantities hedged and for the hedge accounting.
Accounting treatment, sources of ineffectiveness and prospective effectiveness assessment method by risk category
Prospective effectiveness
Accounting treatment Potential sources of ineffectiveness assessment method
Interest rate and/or foreign exchange rate Cash flow hedge Counterparty credit risk Critical terms match
fluctuations
Foreign exchange rate fluctuations Cash flow hedge Lower volume of hedged items / Critical terms match
counterparty credit risk
Interest rate fluctuations Fair value hedge Counterparty credit risk Critical terms match
The ineffective portion of the hedge accounting is recognised in the income statement and included in other financial
income (expense). It is measured using the hypothetical derivative method for cash flow hedges and the cumulative dollar
offset method for fair value hedges. At 31 December 2023 and 2022 none of the above potential sources of ineffectiveness,
individually or collectively, resulted in material amounts of actual ineffectiveness being reported for any hedge accounting
relationships.
The table below shows fair values and nominal amounts of derivative financial instruments, including a range of the maturity of
the nominal amount of the hedging instruments, which are designated as hedging instruments in a cash flow hedge and a fair
value hedge. At 31 December 2023 and 2022, respectively, the Group had the following cash flow hedges and fair value hedges
which are designated in a qualifying hedge relationship:
Fair values and nominal amounts of derivatives used for hedge accounting – at 31 December 2023
Fair value asset Fair value liability
Nominal amount in million CHF in million CHF Maturity range
Cash flow hedges
Risk hedged: foreign exchange rate fluctuations
– Forward exchange contracts JPY 647 billion 41 (174) 2024–2025
Risk hedged: interest rate fluctuations
– Treasury locks 0 0 0 n/a
Total 41 (174)
Fair value hedges

– Interest rate swaps USD 1,150 million 0 (42) 2024–2026
– Interest rate swaps EUR 200 million 0 (8) 2025
– Interest rate swaps CHF 1,250 million 1 (18) 2024–2027
Total 1 (68)
Fair values and nominal amounts of derivatives used for hedge accounting – at 31 December 2022
Fair value asset Fair value liability
Nominal amount in million CHF in million CHF Maturity range
Cash flow hedges
Risk hedged: foreign exchange rate fluctuations
– Forward exchange contracts JPY 635 billion 39 (173) 2023–2024
– Treasury locks 0 0 0 n/a
Total 39 (173)
Fair value hedges

– Interest rate swaps USD 1,540 million 0 (96) 2023–2026
– Interest rate swaps EUR 500 million 0 (17) 2023–2025
– Interest rate swaps CHF 1,050 million 0 (42) 2024
Total 0 (155)
The fair values of derivative financial instruments used for hedge accounting are included in other current assets (see Note 16)
or other current liabilities (see Note 19). The Group’s approach to managing market risk, including interest rate risk and foreign
currency risk, is discussed in the ‘Market risk’ section in this Note.
Cash flow hedges. In November and December 2021 the Group entered into treasury locks to hedge interest rate risk of fixed
rate notes issued by the Group on 13 December 2021. At this date the treasury locks were settled. At 31 December 2023 a
relating hedging reserve of CHF 33 million was held as a deduction within equity (2022: CHF 35 million), which will be released
and transferred to the income statement within financing costs (see Note 4) until redemption of the fixed rate notes. There was
no ineffective portion.
Chugai has entered into forward exchange contracts to hedge a part of its foreign translation exposure to the Swiss franc and
the US dollar. At 31 December 2023 such instruments were recorded as fair value assets of CHF 41 million and as fair value
liabilities of CHF 174 million (2022: fair value assets of CHF 39 million and fair value liabilities of CHF 173 million). There was no
ineffective portion.
Carrying amount of items designated as hedged items in a cash flow hedging relationship in millions of CHF
2023 2022
Assets Liabilities Assets Liabilities
At 31 December
Inventories
Risk hedged by forward exchange contracts: foreign exchange rate fluctuations
– Inventories 3,862 – 4,410 –
Hedging reserve for continuing hedging relationships in millions of CHF
2023 2022
Forward Forward
Treasury exchange Treasury exchange
Total locks contracts Total locks contracts
At 1 January (92) (35) (57) (60) (37) (23)
Gains (losses) taken to equity (344) 0 (344) (238) 0 (238)
Transferred to income statement a) 437 2 435 366 2 364
Transferred to initial carrying amount of hedged items b) (111) – (111) (218) – (218)
Income taxes 6 0 6 28 0 28
Non-controlling interests 5 0 5 25 0 25
Currency translation effects 9 0 9 5 0 5
At 31 December (90) (33) (57) (92) (35) (57)
a) In 2023, an amount of CHF 2 million was transferred to the income statement (2022: CHF 2 million) and reported in financing costs, see Note 4. An additional amount
of CHF 435 million (2022: CHF 364 million) transferred to the income statement was related to forward exchange contracts entered into by Chugai to hedge a part of
its foreign translation exposure to the Swiss franc from revenue transactions. Thereof CHF 19 million (2022: CHF 22 million) were reported in other financial income
(expense) (see Note 4) as well as CHF 298 million (2022: CHF 266 million) and CHF 118 million (2022: CHF 76 million) were reported in Chugai’s sales and other revenue
from other operating segments, respectively (see Note 2).
b) The entire amount transferred to the cost of inventory was related to fair value gains and losses on forward exchange contracts designated by Chugai as cash flow
hedges to hedge a part of its foreign translation exposure to the Swiss franc and the US dollar from inventory purchase transactions.
The expected undiscounted cash flows from qualifying cash flow hedges, including interest payments during the duration of the
derivative contract and final settlement on maturity, are shown in the table below.
Expected cash flows of qualifying cash flow hedges in millions of CHF
2023 2022
Less than More than Less than More than
Total 1 year 1 year Total 1 year 1 year
Cash inflows 5,062 4,254 808 6,857 6,114 743
Cash outflows (5,304) (4,454) (850) (7,155) (6,407) (748)
Total cash inflows (outflows) (242) (200) (42) (298) (293) (5)
The undiscounted cash flows in the table above will affect profit or loss as shown below. These include interest payments during
the duration of the derivative contract but do not include the final settlement on maturity.
Expected cash flows of qualifying cash flow hedges with impact on profit or loss in millions of CHF
2023 2022
Less than More than Less than More than
Total 1 year 1 year Total 1 year 1 year
Cash inflows 0 0 0 0 0 0
Cash outflows 0 0 0 0 0 0
Total cash inflows (outflows) 0 0 0 0 0 0
Fair value hedges. The Group has entered into some interest rate swaps to hedge its exposure to changes in the fair value
of some of its fixed-term debt instruments in respect of a benchmark interest rate. At 31 December 2023 such instruments
were recorded as fair value assets of CHF 1 million and as fair value liabilities of CHF 68 million (2022: fair value assets of
CHF 0 million and fair value liabilities of CHF 155 million). During 2023 fair value adjustments of CHF 88 million were recorded as
income on these interest rate swaps (2022: CHF 137 million as expense). As the fair value hedge had been highly effective since
inception, the result of the interest rate swaps was largely offset by changes in the fair value of the hedged debt instruments.
The Group’s approach to managing market risk, including interest rate risk, is discussed in the ‘Market risk’ section in this Note.
Carrying amount of items designated as hedged items in a fair value hedging relationship in millions of CHF
Fair value Fair value

adjustments adjustments
Liabilities cumulative in current year
At 31 December 2023
Bonds and notes
Risk hedged by interest rate swaps: interest rate fluctuations
– Bonds and notes 2,348 (67) 88
At 31 December 2022
Bonds and notes
Risk hedged by interest rate swaps: interest rate fluctuations
– Bonds and notes 2,826 (155) (137)
Net investment hedges. The Group does not have any net investment hedges.
32. Related parties
Controlling shareholders
On 10 February 2023, the Group announced that it had acquired 540,000 shares for a total consideration of CHF 166 million.
The repurchased shares were initially reported as treasury shares subsequent to acquisition and will be used to cover current as
well as future obligations arising from equity compensation plans. This announcement followed from reports that a member of a
shareholder group with pooled voting rights sold 2.7 million Roche shares.
At 31 December 2023, based on the information available to the Group, a shareholder group with pooled voting rights owned
69,318,000 shares representing 64.97% of the issued shares (31 December 2022: 72,018,000 shares representing 67.50%
of the issued shares). On 5 December 2019 the shareholder group announced that it would continue the shareholder pooling
agreement with a modified shareholder composition. This group now consists of Mr André Hoffmann, Ms Marie-Anne Hoffmann,
Ms Vera Michalski, Mr Alexander Hoffmann, Mr Frederic Hoffmann, Ms Isabel Hoffmann, Mr Lucas Hoffmann, Ms Marina Hoffmann,
Ms Kasia Barbotin-Larrieu, Ms Tatiana Fabre, Mr Andreas Oeri, Ms Catherine Oeri, Ms Sabine Duschmalé, Mr Jörg Duschmalé,
Mr Lukas Duschmalé, the charitable foundation Wolf and Artuma Holding LLC. The shareholder pooling agreement has existed
since 1948. The duration of the pool was extended for an indefinite period in 2009. At 31 December 2023, based on the
information available to the Group, Ms Maja Oeri, formerly a member of the pool, held 8,091,900 shares independently of the
pool, representing 7.58% of the issued shares (31 December 2022: 8,091,900 shares representing 7.58% of the issued shares).
Mr André Hoffmann and Dr Jörg Duschmalé are members of the Board of Directors of Roche Holding Ltd. Mr Hoffmann received
remuneration totalling CHF 402,815 (2022: CHF 406,734) and Dr Duschmalé received remuneration totalling CHF 364,592
(2022: CHF 334,475).
There were no other transactions between the Group and the individual members of the above shareholder group.
Subsidiaries and associates
A listing of the Group subsidiaries and associates is included in Note 33. This listing excludes Chugai’s subsidiaries as well
as companies that are not material, notably companies that are inactive, dormant or in liquidation. Transactions between
the parent company and its subsidiaries and between subsidiaries are eliminated on consolidation. There were no significant
transactions between the Group and its associates.
Key management personnel
Total remuneration of key management personnel was CHF 42 million (2022: CHF 48 million).
Members of the Board of Directors of Roche Holding Ltd receive an annual remuneration and payment for their time and
expenses related to their membership of Board Committees. The Chairman of the Board of Directors and members of the
Corporate Executive Committee (CEC) of Roche Holding Ltd receive remuneration which consists of an annual salary, a bonus
and an expense allowance. The Group pays social insurance contributions in respect of the above remuneration and pays
contributions to pension and other post-employment benefit plans for the Chairman of the Board of Directors and the members
of the CEC. The members of the CEC also participate in certain equity compensation plans as described below. The terms,
vesting conditions and fair value of these awards are disclosed in Note 27.
Remuneration of the members of the Board of Directors and the Corporate Executive Committee in millions of CHF
2023 2022
Salaries, including cash-settled bonus 19 22
Executive stock compensation 8 8
Social security costs 2 2
Pensions and other post-employment benefits 3 3
Equity compensation plans 6 7
Board fees 3 3
Other employee benefits 1 3
Total 42 48
For the purposes of these remuneration disclosures the values for equity compensation plans, including executive stock
compensation, are calculated based on the fair value used in Note 27. These represent the cost to the Group of such awards
at grant date and reflect, amongst other matters, the observed exercise behaviour and exit rate for the whole population that
receive the awards and initial simulations of any performance conditions.
The detailed disclosures regarding executive remuneration that are required by Swiss law are included in the Remuneration
Report disclosed in the Annual Report on pages 148 to 177. In those disclosures the values for equity compensation plans,
including executive stock compensation, represent the fair value that the employee receives taking into account the preliminary
assessment of any completed performance conditions. These fair values are shown in the table below, which reconciles those
disclosures required by Swiss law to the above related party disclosures for key management personnel.
Reconciliation to executive remuneration disclosures required by Swiss law in millions of CHF
2023 2022
Total remuneration of the members of the Board of Directors and Corporate Executive Committee
(IFRS basis – see table above) 42 48
Deduct
– Executive stock compensation (IFRS basis) (8) (8)
– Equity compensation plans (IFRS basis) (6) (7)
Add back
– Executive stock compensation (Swiss legal basis) 6 4
– Equity compensation plans (Swiss legal basis) 13 12
Total remuneration of the members of the Board of Directors and Corporate Executive
Committee (Swiss legal basis) 47 49
Of which (including social security costs)

– Board of Directors (page 165 of the Annual Report) 11 10
– Corporate Executive Committee (page 174 of the Annual Report) 36 39
Executive stock compensation. The Chairman of the Board of Directors until April 2023, Dr Franz, and the Chief Executive
Officer will be granted Bonus Stock Awards in lieu of their cash-settled bonus for the financial year 2023. These are subject
to approval by the 2024 Annual General Meeting in March 2024 and will be issued in March 2024. From April 2023, the new
Chairman of the Board of Directors, Dr Schwan, received part of his base salary in the form of shares blocked for ten years.
The number of awards and fair value per award are calculated at the grant date.
Equity compensation plans. The members of the Corporate Executive Committee received equity compensation as shown in
the following tables.
Number of rights, options and awards granted to members of the Corporate Executive Committee
2023 2022
Roche Stock-settled Stock Appreciation Rights 316,516 183,420
Roche Restricted Stock Unit Plan 11,837 7,190
Contributions paid for members of the Corporate Executive Committee in millions of CHF
2023 2022
Roche Connect 0.1 0.2
Transactions between the Group and the various defined benefit plans for the employees of the Group are described in Note 26.
Finance Report 2023 Notes to the Roche Group Consolidated Financial Statements | Roche Group    143
33. List of subsidiaries and associates
The following is a listing of the Group subsidiaries and associates. It excludes Chugai’s subsidiaries as well as companies that
are not material, notably companies that are inactive, dormant or in liquidation.
Listed companies
Share capital Equity interest

Location Company City (in millions) (in %)
Switzerland Roche Holding Ltd Basel CHF 106.7
Stock Exchange: SIX Swiss Exchange Zurich
Stock code (Share): RO, Valor: 1203211
Stock code (Genussschein): ROG, Valor: 1203204
ISIN Share: CH0012032113
ISIN Genussschein: CH0012032048
Market capitalisation: CHF 196,720 million
Japan Chugai Pharmaceutical Co., Ltd. Tokyo JPY 73,201.8 61.1
Stock Exchange: Tokyo
Stock code: TSE:4519
ISIN: JP3519400000
Market capitalisation: JPY 8,789,267 million
Non-listed companies

Algeria Roche Algérie SPA Hydra DZD 1.0 48
Argentina Productos Roche S.A. Química e Industrial Buenos Aires ARS 18,295.8 100
Roche Diabetes Care Argentina S.A. Buenos Aires ARS 87.4 100
Australia Roche Diabetes Care Australia Pty Limited North Ryde AUD 14.1 100
Roche Diagnostics Australia Pty Limited North Ryde AUD 5.0 100
Roche Products Pty Limited Sydney AUD 65.0 100
Austria mySugr GmbH Vienna EUR 5.7 100
Roche Austria GmbH Vienna EUR 14.5 100
Roche Diabetes Care Austria GmbH Vienna EUR (–) 100
Roche Diagnostics GmbH Vienna EUR 1.1 100
Bangladesh Roche Bangladesh Limited Dhaka BDT 27.2 100
Belarus FLLC "Roche Products Limited" Minsk USD 1.5 100
Belgium Roche Diagnostics Belgium NV Diegem EUR 3.8 100
Roche SA/NV Brussels EUR 32.0 100
Bermuda Chemical Manufacturing and Trading Company Limited Pembroke USD (–) 100
Hoffmann-La Roche Products Limited Pembroke USD (–) 100
Roche Financial Management Ltd. Pembroke USD (–) 100
Roche International Ltd. Pembroke USD (–) 100
Roche Intertrade Limited Pembroke USD 10.0 100
Roche Services Holdings Ltd. Pembroke USD (–) 100
Bolivia Roche Bolivia S.R.L. Santa Cruz BOB 0.1 100
Bosnia and Herzegovina Roche d.o.o. farmaceutsko drustvo - Roche Ltd. Pharmaceutical Company Sarajevo BAM 13.1 100
Brazil Produtos Roche Químicos e Farmacêuticos S.A. São Paulo BRL 1,141.7 100
Roche Diabetes Care Brasil Ltda. São Paulo BRL 44.4 100
Roche Diagnostica Brasil Ltda. São Paulo BRL 683.5 100
Bulgaria Roche Bulgaria EOOD Sofia BGN 5.1 100
Cameroon Roche Cameroun SARL Douala XAF 60.0 100
Canada Hoffmann-La Roche Limited Mississauga CAD 40.3 100
Chile Roche Chile Limitada Santiago de Chile CLP 70.9 100
China Roche (China) Holding Ltd. Shanghai USD 37.3 100
Roche (Shanghai) Pharmaceuticals Consulting Co., Ltd. Shanghai CNY 30.0 100
Roche (Shanghai) Pharmaceuticals Trading Co., Ltd. Shanghai USD 90.0 100
Roche Diagnostics (Hong Kong) Limited Hong Kong HKD 10.0 100
Roche Diagnostics (Shanghai) Ltd. Shanghai USD 31.0 100
Roche Diagnostics (Suzhou) Limited Suzhou USD 160.0 100
Roche Hong Kong Limited Hong Kong HKD 10.0 100
Roche R&D Center (China) Ltd. Shanghai USD 35.8 100
Shanghai Roche Pharmaceuticals Limited Shanghai USD 278.7 70
144    Roche Group | Notes to the Roche Group Consolidated Financial Statements Finance Report 2023

Colombia Productos Roche S.A. Bogotá COP 26,923.7 100
TIB Molbiol S.A.S. Santiago de Cali COP 3.0 100
Congo
Democratic Republic Roche DRC SARLU Kinshasa USD 0.3 100
Costa Rica Roche Services Americas, Sociedad de Responsabilidad Limitada San José CRC 361.4 100
Roche Servicios S.A. Heredia USD 8.1 100
Côte d’Ivoire Roche Côte d’Ivoire SARL Abidjan XOF 50.0 100
Croatia Roche d.o.o. Zagreb EUR 0.6 100
Czech Republic Roche s.r.o. Prague CZK 200.0 100
Denmark OBI Aps Hadsund DKK 4.4 100
Roche Diagnostics a/s Copenhagen DKK 1.3 100
Roche Innovation Center Copenhagen A/S Hoersholm DKK 100.1 100
Roche Pharmaceuticals A/S Copenhagen DKK 4.0 100
Dominican Republic Productos Roche Dominicana, S.R.L. Santo Domingo DOP 0.6 100
Ecuador Roche Ecuador S.A. Quito USD 28.1 100
Egypt Roche Diagnostics Egypt for Trading S.A.E. Giza EGP 5.0 100
Roche Egypt for Manufacturing and Trading SAE Cairo EGP 229.0 100
Roche Egypt LLC Cairo EGP 228.1 100
El Salvador Productos Roche (El Salvador) S.A. de C.V. Antiguo Cuscatlan USD (–) 100
Estonia Roche Eesti OÜ Tallinn EUR 0.1 100
Finland Roche Diagnostics Oy Espoo EUR 0.2 100
Roche Oy Espoo EUR (–) 100
France Institut Roche SAS Boulogne-Billancourt EUR 0.5 100
Roche Diabetes Care France SAS Montbonnot-Saint-Martin EUR 4.5 100
Roche Diagnostics France SAS Meylan EUR 16.0 100
Roche SAS Boulogne-Billancourt EUR 38.2 100
Timkl SAS Montbonnot-Saint-Martin EUR 0.8 100
Georgia Roche Georgia LLC Tbilisi GEL 0.5 100
Germany Ascur Versicherungsvermittlungs GmbH Grenzach-Wyhlen EUR (–) 100
Flatiron Health GmbH Cologne EUR (–) 100
Foundation Medicine GmbH Penzberg EUR (–) 100
Galenus Mannheim Pharma GmbH Mannheim EUR (–) 100
Roche Beteiligungs GmbH Grenzach-Wyhlen EUR 3.6 100
Roche Deutschland Holding GmbH Grenzach-Wyhlen EUR 6.0 100
Roche Diabetes Care Deutschland GmbH Mannheim EUR (–) 100
Roche Diabetes Care GmbH Mannheim EUR (–) 100
Roche Diagnostics Automation Solutions GmbH Ludwigsburg EUR (–) 100
Roche Diagnostics Deutschland GmbH Mannheim EUR 1.0 100
Roche Diagnostics GmbH Mannheim EUR 94.6 100
Roche mtm laboratories AG Mannheim EUR 1.4 100
Roche Pharma AG Grenzach-Wyhlen EUR 61.4 100
Roche Privacy GmbH Grenzach-Wyhlen EUR (–) 100
Roche Real Estate Services Mannheim GmbH Mannheim EUR 1.8 100
Roche Registration GmbH Grenzach-Wyhlen EUR (–) 100
RoX Health GmbH Berlin EUR (–) 100
Signature Diagnostics GmbH Potsdam EUR 0.1 100
TIB Molbiol Syntheselabor GmbH Berlin EUR (–) 100
Ghana Roche Products Ghana Limited Accra GHS 1.2 100
Greece Roche (Hellas) S.A. Marousi EUR 19.2 100
Roche Diagnostics (Hellas) S.A. Marousi EUR 8.3 100
Guatemala Productos Roche Guatemala (Sociedad Anónima) Guatemala City GTQ 0.6 100
Honduras Productos Roche (Honduras), S.A. Tegucigalpa HNL (–) 100
Hungary Roche (Hungary) Ltd Budapest HUF 30.0 100
Roche Services (Europe) Ltd Budapest HUF 3.0 100
India Roche Diabetes Care India Private Limited Mumbai INR 15.2 100
Roche Diagnostics India Private Limited Mumbai INR 149.2 100
Roche Information Solutions India Private Limited Pune INR (–) 100
Roche Products (India) Private Limited Mumbai INR 14.0 100
Indonesia P.T. Roche Indonesia Jakarta IDR 43,770.0 100
Iran Roche Pars Co. (Ltd.) Tehran IRR 41,610.0 100
Ireland Inflazome Limited Dublin EUR (–) 100
Roche Ireland Limited Clarecastle EUR 2.4 100
Roche Products (Ireland) Limited Dublin EUR (–) 100
Spark Therapeutics Ireland Limited Dublin EUR (–) 100

Israel Medingo Ltd. Yokneam Illit ILS 8.0 100
Roche Pharmaceuticals (Israel) Ltd. Hod Hasharon ILS (–) 100
Italy Roche Diabetes Care Italy S.p.A. Monza EUR 40.2 100
Roche Diagnostics S.p.A. Monza EUR 18.1 100
Roche S.p.A. Monza EUR 34.1 100
Japan Flatiron Health K.K. Tokyo JPY 10.0 100
Roche DC Japan K. K. Tokyo JPY 10.0 100
Roche Diagnostics K.K. Tokyo JPY 2,500.0 100
Jordan F. Hoffmann-La Roche Ltd / Jordan P.S.C. Amman JOD (–) 100
Kazakhstan Roche Kazakhstan LLP Almaty KZT 150.0 100
Kenya Roche Kenya Limited Nairobi KES 50.0 100
Kuwait Roche for the Trade in Medicines, Equipment, Devices and Medical Supplies SPC Kuwait City KWD 1.8 100
Latvia Roche Latvija SIA Riga EUR 1.7 100
Lebanon Roche Lebanon S.A.R.L. Beirut LBP 1,000.0 100
Lithuania UAB Roche Lietuva Vilnius EUR 0.2 100
Malaysia Roche (Malaysia) Sdn. Bhd. Kuala Lumpur MYR 4.0 100
Roche Diagnostics (Malaysia) Sdn. Bhd. Petaling Jaya MYR 0.9 100
Roche Services (Asia Pacific) Sdn. Bhd. Kuala Lumpur MYR 0.5 100
Mauritius Roche Products (Mauritius) Ltd Moka MUR 4.0 100
Mexico Productos Roche, S.A. de C.V. Mexico City MXN 82.6 100
Roche DC México, S.A. de C.V. Mexico City MXN 3.9 100
Morocco Roche S.A. Casablanca MAD 59.5 100
Myanmar Roche Myanmar Company Limited Yangon USD (–) 100
Netherlands Roche Diabetes Care Nederland B.V. Almere EUR 0.6 100
Roche Diagnostics Nederland B.V. Almere EUR 2.3 100
Roche Finance Europe B.V. Woerden EUR 2.0 100
Roche Nederland B.V. Woerden EUR 10.9 100
Roche Pharmholding B.V. Woerden EUR 467.8 100
New Zealand Roche Diagnostics NZ Limited Auckland NZD 3.0 100
Roche Products (New Zealand) Limited Auckland NZD 13.5 100
Nicaragua Productos Roche (Nicaragua), S.A. Managua NIO 0.9 100
Nigeria Roche Products Limited Lagos NGN 200.0 100
North Macedonia Roche Makedonija DOOEL Skopje EUR 0.3 100
Norway Roche Diagnostics Norge AS Oslo NOK 5.8 100
Roche Norge AS Oslo NOK 6.2 100
Pakistan Roche Pakistan Limited Karachi PKR 2,063.3 100
Panama Productos Roche (Panama), S.A. Panama City PAB (–) 100
Productos Roche Interamericana S.A. (PRISA) Panama City USD 0.1 100
Roche Products Inc. Panama City USD 0.5 100
Syntex Puerto Rico, Inc. Panama City USD (–) 100
Paraguay Roche Diagnostics Paraguay S.A. Asunción PYG 10,197.6 100
Peru Productos Roche Q.F.S.A. Lima PEN 11.1 100
Roche Farma (Peru) S.A. Lima PEN 38.1 100
Philippines Roche (Philippines) Inc. Taguig City PHP 300.0 100
Poland Roche Diabetes Care Polska sp. z o.o. Warsaw PLN 2.0 100
Roche Diagnostics Polska Sp. z o.o. Warsaw PLN 8.0 100
Roche Polska Sp. z o.o. Warsaw PLN 25.0 100
Portugal Roche Farmacêutica Química, Lda. Amadora EUR 1.1 100
Roche Sistemas de Diagnósticos, Sociedade Unipessoal, Lda. Amadora EUR 2.6 100
Puerto Rico Genentech P.R., Inc. San Juan USD (–) 100
Romania Roche Romania S.R.L. Bucharest RON 472.2 100
Russian Federation "Roche-Moscow" JSC. Moscow RUB 2.6 100
Limited Liability Company Roche Diabetes Care Rus Moscow RUB 100.0 100
Limited Liability Company Roche Diagnostics Rus Moscow RUB 250.0 100
Saudi Arabia Roche Diagnostics Saudi Arabia LLC Riyadh SAR 200.0 75
Roche Products Saudi Arabia LLC Jeddah SAR 30.0 100
Serbia Roche d.o.o. Beograd Belgrade RSD 939.1 100
Singapore Roche Diabetes Care Asia Pacific Pte. Ltd. Singapore SGD 0.6 100
Roche Diagnostics Asia Pacific Pte. Ltd. Singapore SGD 20.4 100
Roche Singapore Pte. Ltd. Singapore SGD 4.0 100
Roche Singapore Technical Operations, Pte. Ltd. Singapore USD 35.0 100

Slovakia Roche Slovensko, S.R.O. Bratislava EUR 0.3 100
Slovenia Roche farmacevtska družba d.o.o. Ljubljana EUR 0.2 100
South Africa Kapa Biosystems (Pty) Ltd Cape Town ZAR (–) 100
Roche Diabetes Care South Africa Proprietary Limited Midrand ZAR 15.0 100
Roche Diagnostics Proprietary Limited Midrand ZAR (–) 100
Roche Products (Proprietary) Limited Midrand ZAR 60.0 100
South Korea Roche Diagnostics Korea Co., Ltd. Seoul KRW 22,969.0 100
Roche Korea Company Ltd. Seoul KRW 13,375.0 100
Spain Roche Diabetes Care Spain, S.L. Sant Cugat del Vallès EUR 1.0 100
Roche Diagnostics S.L. Sant Cugat del Vallès EUR 17.0 100
Roche Farma, S.A. Madrid EUR 45.0 100
Sweden Roche AB Solna SEK 20.0 100
Roche Diagnostics Scandinavia AB Solna SEK 9.0 100
Switzerland Biopharm AG Basel CHF 0.3 100
F. Hoffmann-La Roche Ltd Basel CHF 150.0 100
Hoffmann - La Roche Ltd Basel CHF 0.5 100
InterMune International AG Basel CHF 10.0 100
Museum Tinguely AG Basel CHF 0.1 100
Phaor AG Basel CHF 0.2 100
Roche Capital Market Ltd Basel CHF 1.0 100
Roche Catalyst Investments Ltd. Basel USD 0.5 100
Roche Chemische Unternehmungen AG Basel CHF 1.3 100
Roche Diabetes Care (Switzerland) Ltd Rotkreuz CHF 0.1 100
Roche Diagnostics (Switzerland) Ltd Rotkreuz CHF 1.0 100
Roche Diagnostics International Ltd Rotkreuz CHF 20.0 100
Roche Finance Ltd Basel CHF 409.2 100
Roche Financial Investments Ltd. Basel EUR 0.5 100
Roche Forum Buonas Ltd Buonas CHF 0.1 100
Roche Glycart Ltd Schlieren CHF 0.3 100
Roche Long Term Foundation Basel CHF 0.5 100
Roche Pharma (Switzerland) Ltd Basel CHF 2.0 100
Roche Sapac Ltd. Basel CHF 0.5 100
Tavero AG Basel CHF 0.1 100
Taiwan Roche Diagnostics Ltd. Taipei TWD 1,107.4 100
Roche Products Ltd. Taipei TWD 2,212.7 100
Thailand Roche Diagnostics (Thailand) Limited Bangkok THB 103.0 100
Roche Thailand Limited Bangkok THB 12.0 100
Tunisia Roche Tunisie SA Tunis TND 0.8 100
Türkiye Infogenetik Moleküler Bilgi Hizmetleri Anonim Şirketi Istanbul TRY 3.5 100
Roche Diagnostics Turkey Anonim Şirketi Istanbul TRY 250.0 100
Roche Müstahzarlari Sanayi Anonim Şirketi Istanbul TRY 249.5 100
Ukraine Roche Ukraine LLC Kiev UAH 124.0 100
United Arab Emirates Roche Diabetes Care Middle East FZCO Dubai AED 0.5 100
Roche Diagnostics Middle East FZCO Dubai AED 19.0 100
Roche Pharmaceuticals Middle East FZCO Dubai AED 0.5 100
United Kingdom Flatiron Health UK Ltd St Albans GBP (–) 100
Inflazome UK Limited Welwyn Garden City GBP (–) 100
InterMune Holdings Limited Welwyn Garden City GBP (–) 100
Roche Diabetes Care Limited Burgess Hill GBP 0.4 100
Roche Diagnostics Limited Burgess Hill GBP 32.6 100
Roche Holding (UK) Limited Welwyn Garden City GBP 100.0 100
Roche Products Limited Welwyn Garden City GBP 98.3 100
Roche Registration Limited Welwyn Garden City GBP (–) 100
Spark Therapeutics UK Ltd London GBP (–) 100
TMEM16A Limited Welwyn Garden City GBP 0.2 100
Tusk Therapeutics Limited Welwyn Garden City GBP (–) 100

United States Adheron Therapeutics, Inc. South San Francisco USD (–) 100
Anadys Pharmaceuticals, Inc. South San Francisco USD (–) 100
Bina Technologies, Inc. Pleasanton USD (–) 100
BioVeris Corporation Indianapolis USD (–) 100
Flatiron Health, Inc. New York USD (–) 100
ForSight VISION4, Inc. South San Francisco USD (–) 100
Foundation Medicine, Inc. Cambridge USD (–) 100
Freenome Holdings, Inc. South San Francisco USD (–) 16
Genentech USA, Inc. South San Francisco USD (–) 100
Genentech, Inc. South San Francisco USD (–) 100
GenMark Diagnostics, Inc. Carlsbad USD (–) 100
GenMark Holdings, Inc. Carlsbad USD (–) 100
Good Therapeutics, Inc. South San Francisco USD (–) 100
Hoffmann-La Roche Inc. Little Falls USD 3.0 100
IGEN International, Inc. Pleasanton USD (–) 100
Ignyta, Inc. South San Francisco USD (–) 100
InterMune, Inc. South San Francisco USD (–) 100
IQuum, Inc. Indianapolis USD (–) 100
Jecure Therapeutics, Inc. South San Francisco USD (–) 100
Kapa Biosystems, Inc. Wilmington USD (–) 100
Lexent Bio, Inc. Cambridge USD (–) 100
Memory Pharmaceuticals Corp. Little Falls USD (–) 100
Prescient Design Corp. South San Francisco USD (–) 100
Promedior, Inc. South San Francisco USD (–) 100
Protocol First, Inc. Salt Lake City USD (–) 100
Roche Diabetes Care, Inc. Indianapolis USD (–) 100
Roche Diagnostics Corporation Indianapolis USD (–) 100
Roche Diagnostics Hematology, Inc. Westborough USD (–) 100
Roche Diagnostics Operations, Inc. Indianapolis USD (–) 100
Roche Diagnostics Seattle, Inc. Seattle USD (–) 100
Roche Holdings, Inc. South San Francisco USD 1.0 100
Roche Laboratories Inc. Little Falls USD (–) 100
Roche Molecular Systems, Inc. Pleasanton USD (–) 100
Roche Palo Alto LLC South San Francisco USD (–) 100
Roche Sequencing Solutions, Inc. Pleasanton USD (–) 100
Roche TCRC, Inc. Little Falls USD (–) 100
Seragon Pharmaceuticals Inc. South San Francisco USD (–) 100
Spark Therapeutics International Holdings, Inc. Philadelphia USD (–) 100
Spark Therapeutics, Inc. Philadelphia USD (–) 100
Tanox, Inc. South San Francisco USD (–) 100
Telavant Holdings, Inc. New York USD 1.4 100
Telavant, Inc. New York USD (–) 100
Therapeutic Human Polyclonals, Inc. South San Francisco USD (–) 100
TIB Molbiol LLC Howell Township USD (–) 100
Ventana Medical Systems, Inc. Tucson USD (–) 100
Viewics, Inc. Santa Clara USD (–) 100
Uruguay Roche International Ltd. (Montevideo Branch) Montevideo UYU (–) 100
Venezuela Productos Roche S.A. Caracas VEF 156.9 100
Vietnam Roche Pharma (Vietnam) Company Limited Ho Chi Minh City VND 75,600.0 100
Roche Vietnam Company Limited Ho Chi Minh City USD 25.0 100
(–) = share capital of less than 100,000 local currency units.

34. Accounting policies
This note provides a list of accounting policies adopted by the Group in the preparation of the Annual Financial Statements and
the changes in accounting policies in 2023.
Consolidation policy
Subsidiaries are all companies over which the Group has control. The Group controls an entity when the Group is exposed
to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its
power over the entity. Companies acquired during the year are consolidated from the date on which control is transferred to
the Group, and subsidiaries to be divested are included up to the date on which control passes from the Group. Intercompany
balances, transactions and resulting unrealised income are eliminated in full. Changes in ownership interests in subsidiaries are
accounted for as equity transactions if they occur after control has already been obtained and if they do not result in a loss of
control. Associates are companies over which the Group exercises, or has the power to exercise, significant influence, but which
it does not control, and they are accounted for using the equity method.
Segment reporting
For the purpose of segment reporting the Group’s Corporate Executive Committee (CEC) is considered to be the Group’s Chief
Operating Decision Maker. The determination of the Group’s operating segments is based on the organisation units for which
information is reported to the CEC on a regular basis. The information provided is used as the basis of the segment revenue
and profit disclosures reported in Note 2, with the geographic analysis based on the location of customers. Selected segment
balance sheet information is also routinely provided to the CEC.
Transfer prices between operating segments are set on an arm’s length basis. Operating assets and liabilities consist of property,
plant and equipment, goodwill and intangible assets, trade receivables/payables, inventories and other assets and liabilities,
such as provisions, which can be reasonably attributed to the reported operating segments. Non-operating assets and liabilities
mainly include current and deferred income tax balances, post-employment benefit assets/liabilities and financial assets/liabilities
such as cash, marketable securities, investments and debt.
Foreign currency translation
The Annual Financial Statements are presented in Swiss francs. Most Group companies use their local currency as their
functional currency. Certain Group companies use other currencies (such as US dollar, Swiss franc or euro) as their functional
currency where this is the currency of the primary economic environment in which the entity operates. Local transactions
in other currencies are initially reported using the exchange rate at the date of the transaction. Gains and losses from the
settlement of such transactions and gains and losses on translation of monetary assets and liabilities denominated in other
currencies are included in income, except when they are qualifying cash flow hedges or arise on monetary items that, in
substance, form part of the Group’s net investment in a foreign entity. In such cases the gains and losses are deferred into
other comprehensive income.
Upon consolidation, assets and liabilities of Group companies using functional currencies other than Swiss francs are translated
into Swiss francs using year-end rates of exchange. The income statement and statement of cash flows are translated at the
average rates of exchange for the year. Translation differences due to the changes in exchange rates between the beginning
and the end of the year and the difference between net income translated at the average and year-end exchange rates are
taken directly to other comprehensive income.
Revenue
Sales. Revenue from the sale of goods supplied (product sales) and services rendered are recorded as ‘Sales’.
Sales are recognised when a promise in a customer contract (performance obligation) has been satisfied by transferring control
over the promised goods and services to the customer. Control over a promised good or service refers to the ability to direct
the use of, and obtain substantially all of the remaining benefits from, those goods or services. Control is usually transferred
upon shipment, delivery to, upon receipt of goods by the customer, or as services are rendered, in accordance with the delivery
and acceptance terms agreed with the customers. For goods subject to installation, such as instruments sold in the Diagnostics
Division, sales are generally recognised upon completion of the installation at the customer’s site and customer acceptance.
The amount of sales to be recognised (transaction price) is based on the consideration the Group expects to receive in exchange
for its goods and services, excluding amounts collected on behalf of third parties such as value added taxes or other taxes
directly linked to sales. If a contract contains more than one performance obligation, the transaction price is allocated to each
performance obligation based on their relative stand-alone selling prices.
Instruments in the Diagnostics Division may be sold together with other goods such as reagents and other consumables as well
as services under a single contract or under several contracts that are combined for revenue recognition purposes. Sales are
recognised upon satisfaction of each of the performance obligations in the contract. Instruments are either sold in cash and
instalment sales transactions or otherwise made available to customers under finance lease and operating lease transactions.
∙ Finance leases: Arrangements in which the Group transfers substantially all of the risks and rewards of ownership to the
customer are treated as finance lease arrangements. Income from finance leases is recognised as sales at amounts that
represent the fair value of the instrument, which approximates the present value of the minimum lease payments under the
arrangement. As interest rates embedded in finance lease arrangements are approximately market rates, income from finance
leases is comparable to revenue for outright sales. Finance income for finance lease arrangements longer than twelve months
is deferred and subsequently recognised based on a pattern that approximates the use of the effective interest rate method
and recorded in other revenue.
∙ Operating leases: Income from operating leases is recognised as sales on a straight-line basis over the lease term or, when
lease revenue is entirely variable and subject to subsequent reagent sales, as the performance obligation to deliver reagents
is satisfied.
Sales, net of discounts, are based on estimates regarding the related obligations, including their stand-alone selling prices or
fair values. It requires judgement to determine when different obligations are satisfied, including whether enforceable purchase
commitments for further obligations exist and when they arise.
For contracts with distributors, no sales are recognised when goods are physically transferred to the distributor under a
consignment arrangement, or if the distributor acts as an agent. In such cases, sales are recognised when control over the
goods transfers to the end-customer, and distributor’s commissions are presented within selling, general and administration
costs. Commissions and similar payments to distributors acting as principals are deducted from sales unless such payments are
in exchange for a distinct service.
The consideration received by the Group in exchange for its goods and services may be fixed or variable. Variable consideration
is only recognised when it is considered highly probable that a significant revenue reversal will not occur once the underlying
uncertainty related to variable consideration is subsequently resolved. The most common elements of variable consideration in
the Pharmaceuticals Division are listed below:
∙ Government and regulatory mandatory price reductions. The major elements of these mandatory price reductions are the
340B Drug Discount Program, Medicaid and other plans in the US.
∙ Contractual price reductions. These include rebates and chargebacks that are the result of contractual agreements that are
primarily volume based and performance based.
∙ Cash discounts. These include credits offered to wholesalers for remitting payment on their purchases within contractually
defined incentive periods.
∙ Customer returns reserves. These are allowances established for expected product returns.
Revenues from product sales are recorded net of allowances for estimated rebates, chargebacks, cash discounts and estimates
of product returns, all of which are established at the time of sale. All product sales allowances are based on estimates of the
amounts earned or to be claimed on the related sales. These estimates take into consideration historical experience, current
contractual and statutory requirements, specific known market events and trends such as competitive pricing and new product
introductions, estimated inventory levels, and the shelf life of products. If actual future results vary, these estimates need to
be adjusted, with an effect on sales and earnings in the period of the adjustment. Sales reductions that are expected to be
withheld by the customer upon settlement, such as contractual price reductions and cash discounts, are recorded in the balance
sheet as a deduction from trade receivables. Sales reductions that are separately payable to customers, governmental health
authorities or healthcare regulatory authorities are recorded in the balance sheet as accrued liabilities. Provisions for sales
returns are recorded in the balance sheet as other provisions.
The Group recognises a deferred income (contract liability) if consideration has been received (or has become receivable)
before the Group transfers the promised goods or services to the customer. Deferred income mainly relates to remaining
performance obligations for goods free of charge under certain patient access or similar programmes, reagents and other
consumables and services.
Remaining performance obligations in (partially) unsatisfied long-term contracts are either included in deferred income or
are related to amounts the Group expects to receive for goods and services that have not yet been transferred to customers
under existing, non-cancellable or otherwise enforceable contracts. These are mainly associated with contracts with minimum
purchase commitments related to reagents and consumables for previously sold instruments as well as monitoring and
maintenance services. For contracts that have an original duration of one year or less, the Group has elected the practical
expedient to not disclose the transaction price for remaining performance obligations at the end of each reporting period and
at which point in time the Group expects to recognise these sales.
Other revenue. Other revenue includes royalty income, profit-share income, other income from collaboration and out-licensing
agreements and other items, including interest income from finance leases.
Royalty income earned through a licence is recognised as the underlying sales are recorded by the licensee. Income from
profit-sharing agreements with collaboration partners is recognised as underlying sales and cost of sales are recorded by the
collaboration partners.
Income from out-licensing agreements typically arises from the receipt of upfront, milestone and other similar payments from
third parties for granting a licence to product- or technology-related intellectual property (IP). Collaboration and out-licensing
agreements may be entered into with no further obligation or may include commitments to conduct research, late-stage
development, regulatory approval, co-marketing or manufacturing. Licences granted are usually rights to use IP and are
generally unique. Therefore the basis of allocating revenue to performance obligations makes use of the residual approach.
Upfront payments and other licensing fees are usually recognised upon granting the licence unless some of the income shall be
deferred for other performance obligations using the residual approach. Such deferred income is released and recognised as
revenue when other performance obligations are satisfied. Milestone payments are typically received upon reaching a specific
scientific milestone (development milestone) or upon achieving a certain annual sales milestone (commercial milestone).
Development milestone income is recognised at the point in time when it is highly probable that the respective milestone event
criterion is achieved, and the risk of revenue reversal is considered remote. Commercial milestone income is accrued and
recognised as revenue when it is highly probable that the annual sales milestone is reached during the period.
Also included is income from other services rendered which are usually not part of the Group’s primary business activities,
to the extent that such revenue is not recorded under ‘Sales’, and is recognised when control transfers and performance
obligations are satisfied.
Cost of sales
Cost of sales includes the corresponding direct production costs and related production overheads of goods sold and services
rendered. Royalties, alliance and collaboration expenses, including all collaboration profit-sharing agreements, are also
reported as part of cost of sales. Start-up costs between validation and the achievement of normal production capacity are
expensed as incurred.
Internal research and development activities are expensed as incurred for the following:
∙ Internal research costs incurred for the purpose of gaining new scientific or technical knowledge and understanding.
∙ Internal development costs incurred for the application of research findings or other knowledge to plan and develop new
products for commercial production. The development projects undertaken by the Group are subject to technical, regulatory
and other uncertainties, such that, in the opinion of management, the criteria for capitalisation as intangible assets are not
met prior to obtaining marketing approval by the regulatory authorities in major markets.
∙ Post-marketing studies after regulatory approval, such as phase IV costs in the pharmaceuticals business, generally involve
safety surveillance and ongoing technical support of a drug after it receives marketing approval to be sold. They may be
required by regulatory authorities or may be undertaken for safety or commercial reasons. The costs of such post-marketing
studies are not capitalised as intangible assets as, in the opinion of management, they do not generate separately identifiable
incremental future economic benefits that can be reliably measured.
Acquired in-process research and development resources obtained through in-licensing arrangements, business combinations
or separate asset purchases, including asset acquisitions, are capitalised as intangible assets. The acquired asset must be
controlled by the Group, be separately identifiable and expected to generate future economic benefits, even if uncertainty
exists as to whether the research and development will ultimately result in a marketable product. Consequently, upfront
and milestone payments to third parties for pharmaceutical products or compounds before regulatory marketing approval
are recognised as intangible assets. Assets acquired through such arrangements are measured on the basis set out in the
‘Intangible assets’ policy. Subsequent internal research and development costs incurred post-acquisition are treated in the
same way as other internal research and development costs. If research and development are embedded in contracts for
strategic alliances, the Group carefully assesses whether upfront or milestone payments constitute funding of research and
development work or acquisition of an asset.
Other operating income (expense)
Other operating income (expense) includes non-revenue income and expenses that do not fall into the regular functional costs.
Amongst others, it includes impairment charges related to goodwill and income from disposal of product rights. Payments
received for the disposal of products and similar rights are recognised as income upon transfer of control over such rights.
Employee benefits
Short-term employee benefits include wages, salaries, social security contributions, paid annual leave and sick leave, profit
sharing and bonuses, and non-monetary benefits for current employees. The costs are recognised within the operating results
when the employee has rendered the associated service. The Group recognises a liability for profit sharing and bonuses where
contractually obliged or where there is a past practice that has created a constructive obligation.
Long-term employee benefits include long-service or sabbatical leave, long-service benefits and long-term disability benefits.
The expected costs of these benefits are accrued over the period of employment. Any changes in the carrying value of other
long-term employee benefit liabilities are recognised within the operating results.
Termination benefits are payable when employment is terminated by the Group before the normal retirement date, or whenever
an employee accepts voluntary redundancy in exchange for these benefits. Termination costs are recognised at the earlier of
when the Group can no longer withdraw the offer of the benefits or when the Group recognises any related restructuring costs.
For defined contribution plans the Group contributions are recognised within the operating results when the employee has
rendered the associated service. Prepaid contributions are recognised as an asset to the extent that a cash refund or a
reduction in future payments is available.
For defined benefit plans the liability recognised in the balance sheet is the present value of the defined benefit obligation less
the fair value of the plan assets. All changes in the net defined benefit liability are recognised as they occur as follows:
Recognised in the income statement:

∙ Current service cost is charged to the appropriate income statement heading within the operating results.
∙ Past service cost, including curtailment gains or losses, is recognised immediately in other operating income (expense) within
the operating results.
∙ Settlement gains or losses are recognised in other operating income (expense) within the operating results.
∙ Net interest on the net defined benefit liability is recognised in financing costs.
Recognised in other comprehensive income:
∙ Actuarial gains and losses arising from experience adjustments (the difference between previous assumptions and what has
actually occurred) and changes in actuarial assumptions.
∙ The return on plan assets, excluding amounts included in net interest on the net defined benefit liability.
∙ Any change in the limit on the recognition of plan assets, excluding amounts included in net interest on the net defined benefit
liability.
Net interest on the net defined benefit liability is comprised of interest income on plan assets, interest cost on the defined
benefit obligation and interest on the effect of the limit on the recognition of pension assets. The net interest is calculated
using the same discount rate that is used in calculating the defined benefit obligation, applied to the net defined liability at the
start of the period, taking into account any changes from contribution or benefit payments.
Pension assets and liabilities in different defined benefit plans are not offset unless the Group has a legally enforceable right to
use the surplus in one plan to settle obligations in the other plan.
The fair value of all equity compensation awards granted to employees is estimated at the grant date and recorded as an
expense over the vesting period. The expense is charged to the appropriate income statement heading within the operating
results. For equity-settled plans, an increase in equity is recorded for this expense and any subsequent cash flows from
exercises of vested awards are recorded as changes in equity.
Property, plant and equipment
Property, plant and equipment are initially recorded at cost of purchase or construction, and include all costs directly attributable
to bringing the asset to the location and condition necessary for it to be capable of operating in the manner intended by
management. These include items such as costs of site preparation, installation and assembly costs, and professional fees.
The net costs of testing whether the asset is functioning properly, including validation costs, are also included in the initially
recorded cost of construction. Interest and other borrowing costs incurred with respect to qualifying assets are capitalised
and included in the carrying value of the assets. Property, plant and equipment are depreciated on a straight-line basis, except
for land, which is not depreciated. The estimated useful lives of major classes of depreciable assets are as follows:
Land improvements 40 years

Buildings 10–50 years
Machinery and equipment:
∙ Diagnostic instruments 3–5 years
∙ Office equipment 3–6 years
∙ Motor vehicles 5–8 years
∙ Other machinery and equipment 4–15 years
Where parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate
components. The estimated useful lives of the assets are regularly reviewed and, if necessary, the future depreciation charges
are accelerated. Repairs and maintenance costs are expensed as incurred.
Leases
Where the Group is the lessee. At inception of a contract the Group assesses whether a contract is, or contains, a lease.
A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time
in exchange for consideration. The Group recognises a right-of-use asset and a corresponding lease liability for each contract
that is, or contains, a lease at the lease commencement date, except for short-term leases and leases of low-value assets.
Payments for short-term leases and leases of low-value assets are recognised as an expense on a straight-line basis over the
term of the respective lease. The lease liability is initially measured at the present value of the future lease payments that are
not paid at the lease commencement date. The lease payments are discounted using the interest rate implicit in the lease or,
if not readily determinable, the Group’s incremental borrowing rate in the respective markets. Lease payments include fixed
payments, variable payments that depend on an index or rate known at the lease commencement date and payments from
exercising extension or purchase options if the Group is reasonably certain to exercise. The lease liability is subsequently
measured at amortised costs using the effective interest method. It is remeasured, with a corresponding adjustment to the
related right-of-use asset, when there is a change in future lease payments following a contract renegotiation, a change of
an index or rate or a reassessment of options. The right-of-use asset is initially measured at cost, which comprises the initial
amount of the lease liability adjusted for any payments made at or before the lease commencement date and which includes
any initial direct costs incurred and expected costs of obligations to dismantle, remove or refurbish the underlying asset,
less any incentives received. Right-of-use assets are depreciated on a straight-line basis from the lease commencement date
over the shorter of the lease term or the useful life of the underlying asset. Right-of-use assets are assessed for impairment
whenever there is an indication for impairment.
Where the Group is the lessor. Certain assets, mainly diagnostics instruments, are leased to third-party customers through
both finance and operating lease arrangements. Such transactions may be entered into in separate contracts or in combined
contracts including reagents and other consumables and services. The treatment of leasing transactions is mainly determined
by whether the lease is considered to be an operating or finance lease, which requires judgement. In making this assessment,
management looks at the substance of the lease, as well as the legal form, and makes a judgement about whether substantially
all of the risks and rewards of ownership are transferred. If this is the case, then the lease is a finance lease. If not, then it is
an operating lease. Arrangements which do not take the legal form of a lease but that nevertheless convey the right to use an
asset are also covered by such judgemental assessments.
∙ Finance leases: Finance lease assets are reported as receivables at an amount equal to the net investment in the lease.
Income from finance leases is recognised as sales at amounts that represent the stand-alone selling price of the instrument,
which approximates the present value of the minimum lease payments under the arrangement. Minimum lease payments
exclude any variable lease payments or contingent rent. Finance income for finance lease arrangements longer than twelve
months is deferred and subsequently recognised based on a pattern that approximates the use of the effective interest
method and recorded in other revenue.
∙ Operating leases: Income from operating leases is recognised as sales on a straight-line basis over the lease term at amounts
that represent the stand-alone selling price of the instrument, which approximates the present value of the minimum lease
payments under the arrangement. Minimum lease payments exclude any variable lease payments or contingent rent. When
lease revenue is entirely based on variable lease payments and subject to subsequent reagent sales, it is recognised as the
performance obligations for reagents are satisfied.
Sales, net of discounts, are based on estimates regarding the related obligations, including their stand-alone selling prices.
It requires judgement to determine when different obligations are satisfied, including whether enforceable purchase
commitments for further obligations exist and when they arise.
Mergers and acquisitions
Business combinations. Business combinations are accounted for using the acquisition method of accounting. At the date
of the acquisition the Group initially recognises the fair value of the identifiable assets acquired, the liabilities assumed and
any non-controlling interest in the acquired business. The consideration transferred is measured at fair value at the date
of acquisition. Where the Group does not acquire 100% ownership of the acquired business, non-controlling interests are
recorded either at fair value or as the proportion of the fair value of the acquired net assets attributable to the non-controlling
interest. Directly attributable acquisition-related costs are expensed as incurred within other operating income (expense).
Asset acquisitions. Asset acquisitions are acquisitions of legal entities that do not qualify as business combinations. At the
date of the acquisition the Group initially recognises the individual identifiable assets acquired and liabilities assumed. The cost
to the Group at the date of the acquisition is allocated to the individual identifiable assets and liabilities on the basis of their
relative fair values at the date of the acquisition. Subsequent consideration for performance-related development milestones is
recognised as intangible assets when the specific milestones have been achieved and other recognition criteria are met. Such
transactions do not give rise to goodwill. Material directly attributable acquisition-related costs are included in the cost of the
acquired assets.
Goodwill
Goodwill arises in a business combination and is the excess of the consideration transferred to acquire the business over
the underlying fair value of the net identified assets acquired. Goodwill is not amortised but is tested for impairment at least
annually and upon the occurrence of an indication of impairment.
Intangible assets
Purchased patents, licences, trademarks and other intangible assets are initially recorded at cost. Assets that have been
acquired through a business combination are initially recorded at fair value. Commercial software development costs are
capitalised when certain recognition criteria such as technical feasibility and commercial viability are met. Once available for
use, intangible assets are amortised on a straight-line basis over their useful lives. Intangible assets are reviewed for impairment
at each reporting date. The estimated useful life is the lower of the legal duration and the economic useful life. The estimated
useful lives of intangible assets are regularly reviewed. Estimated useful lives of major classes of amortisable intangible assets
are as follows:
Product intangibles in use up to 20 years

Other intangible assets:
∙ Marketing intangibles in use up to 15 years
∙ Technology intangibles in use up to 20 years
Impairment of property, plant and equipment, right-of-use assets and intangible assets
An impairment assessment is carried out when there is evidence that an asset may be impaired. In addition, intangible assets
that are not yet available for use are tested for impairment annually. When the recoverable amount of an asset, being the higher
of its fair value less costs of disposal and its value in use, is less than its carrying value, then the carrying value is reduced to
its recoverable amount. This reduction is reported in the income statement as an impairment loss. Value in use is calculated
using estimated cash flows, generally over a five-year period, with extrapolating projections for subsequent years. These are
discounted using an appropriate long-term interest rate. Fair value less costs of disposal is calculated using a discounted cash
flow approach and reflects estimates of the assumptions that market participants would be expected to use when pricing
the assets using often unobservable market inputs. When an impairment loss arises, the useful life of the asset is reviewed
and, if necessary, the future depreciation/amortisation charge is accelerated. If the amount of impairment loss subsequently
decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, then the
previously recognised impairment loss is reversed through the income statement as an impairment reversal.
Impairment of goodwill
Goodwill is assessed for impairment at each reporting date and is additionally tested annually for impairment. Goodwill is
allocated to cash-generating units and when the recoverable amount of the cash-generating unit, being the higher of its fair
value less costs of disposal or its value in use, is less than its carrying value, then the carrying value of the goodwill is reduced
to its recoverable amount. This reduction is reported in the income statement as an impairment loss. When an acquired
business that is included within a cash-generating unit permanently ceases to operate, then it is treated as a disposal of that
business. For separately identifiable goodwill that was generated on the initial acquisition of that business and where all of the
factors that made up that goodwill are entirely unrelated to the continuing operations of the cash-generating unit, then the
goodwill is deemed to have been disposed of and is fully impaired. As described in Note 9, this also applies if acquired products
permanently cease to generate economic benefits or if acquired technologies permanently cease to operate. The impairment
testing methodology is further described in Note 9.
Inventories
Inventories are stated at the lower of cost and net realisable value. The cost of finished goods, work in process and intermediates
includes raw materials, direct labour and other directly attributable costs and overheads based upon the normal capacity of
production facilities. Cost is determined using the weighted average method. Net realisable value is the estimated selling price
less cost to completion and selling expenses.
Receivables, including accounts receivable
Receivables are carried at the original invoice amount less allowances made for doubtful accounts, trade discounts, cash
discounts, volume rebates and similar allowances. A receivable represents a right to consideration that is unconditional and
excludes contract assets. An allowance for doubtful accounts is recorded for expected credit losses over the term of
the receivables. These estimates are based on specific indicators, such as the ageing of customer balances, specific credit
circumstances and the Group’s historical loss rates for each category of customers, and adjusted for forward-looking
macroeconomic data. Expenses for doubtful trade receivables are recognised within selling, general and administration costs.
Trade discounts, cash discounts, volume rebates and similar allowances are recorded on an accrual basis consistent with the
recognition of the related sales, using estimates based on existing contractual obligations, historical trends and the Group’s
experience.
Receivables are written off (either partly or in full) when there is no reasonable expectation of recovery. Where receivables
have been written off, the Group continues to engage in enforcement activities to attempt to recover the receivable due. Where
recoveries are made, these are recognised in profit or loss.
For trade and lease receivables, the Group applies the simplified approach prescribed by IFRS 9, which requires/permits the use
of the lifetime expected loss provision from initial recognition of the receivables. The Group measures an allowance for doubtful
accounts equal to the credit losses expected over the lifetime of the trade and lease receivables.
Cash and cash equivalents
Cash and cash equivalents include cash on hand and time, call and current balances with banks and similar institutions.
Such balances are only reported as cash equivalents if they are readily convertible to known amounts of cash, are subject to
insignificant risk of changes in their fair value and have a maturity of three months or less from the date of acquisition.
Assets held for sale and liabilities directly associated with assets held for sale
Assets held for sale and the liabilities directly associated with assets held for sale are presented separately in the current
section of the balance sheet where their carrying amounts are to be recovered principally through a sale transaction which is
considered highly probable to be completed within 12 months. Immediately before the initial classification as held for sale,
the carrying amounts of the assets and liabilities are measured in accordance with the applicable accounting policy. Assets
held for sale and the directly associated liabilities are subsequently measured at the lower of their carrying amount and fair
value less costs to sell. Assets held for sale are no longer amortised or depreciated.
Provisions and contingencies
Provisions are recognised where a legal or constructive obligation has been incurred which will probably lead to an outflow of
resources that can be reliably estimated. In particular, restructuring provisions are recognised when the Group has a detailed
formal plan that has either commenced implementation or has been announced. Provisions are recorded for the estimated
ultimate liability that is expected to arise and are discounted when the time value of money is material. A contingent liability is
disclosed where the existence of the obligation will only be confirmed by future events or where the amount of the obligation
cannot be measured with reasonable reliability. Contingent assets are not recognised, but are disclosed where an inflow of
economic benefits is probable.
Fair values
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between
market participants at the measurement date. It is determined by reference to quoted market prices or by the use of established
valuation techniques such as option pricing models and the discounted cash flow method if quoted prices in an active market
are not available.
Financial instruments
The Group classifies its financial instruments in the following measurement categories which are disclosed in Note 31: amortised
cost; fair value through OCI; fair value through OCI – equity investments; or fair value through profit or loss (including hedging
instruments).
The classification depends on the Group’s business model for managing the financial assets and the contractual terms of the
cash flows. The Group reclassifies debt securities and financial assets at amortised cost when and only when its business model
for managing those assets changes.
At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset not at fair value
through profit or loss, transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs
of financial assets carried at fair value through profit or loss are expensed in profit or loss.
Amortised cost. Assets that are held for collection of contractual cash flows where those cash flows represent solely
payments of principal and interest are measured at amortised cost, less provision for impairment. A gain or loss on a debt
security that is subsequently measured at amortised cost and is not part of a hedging relationship is recognised in profit or loss
when the asset is derecognised or impaired. Interest income from these financial assets is included in other financial income
using the effective interest rate method. Assets at amortised cost are mainly comprised of accounts receivable, cash and cash
equivalents and time accounts over three months.
Fair value through other comprehensive income (fair value through OCI). These are financial assets that are held for collection
of contractual cash flows and for selling the financial assets, where the assets’ cash flows represent solely payments of principal
and interest. Those are initially recorded and subsequently carried at fair value. Changes in the fair value are recorded in other
comprehensive income, except for the recognition of impairment gains or losses, interest revenue and foreign exchange gains
and losses which are recognised in profit or loss. When the financial asset is derecognised, the cumulative gain or loss previously
recognised in OCI is reclassified from equity to profit or loss. Interest income from these financial assets is included in other
financial income using the effective interest rate method. Fair value through other comprehensive income assets are mainly
comprised of money market instruments and debt securities.
Equity investments at fair value through other comprehensive income (fair value through OCI). These are equity investments
in private biotechnology companies, which are kept as part of the Group’s strategic alliance efforts. These assets are subsequently
measured at fair value. Dividends are recognised as other financial income in profit or loss unless the dividend clearly represents
a recovery of part of the cost of the investment. Other net gains and losses are recognised in OCI and included in the fair value
reserve. When such an asset is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified within equity
from the fair value reserve to retained earnings and never to profit or loss.
Fair value through profit or loss. These are financial assets whose performance is evaluated on a fair value basis. A gain or loss
on a financial asset that is subsequently measured at fair value through profit or loss and is not part of a hedging relationship
is recognised in profit or loss and presented within other financial income (expense) in the period in which it arises. Fair value
through profit or loss assets are mainly comprised of equity investments/securities and debt investments. Contingent consideration
liabilities are initially recorded and subsequently carried at fair value with changes in fair value recorded in other operating
income (expense) within the operating results of the income statement.
Fair value through profit or loss – hedging instruments. These are derivative financial instruments that are used to manage
the exposures to foreign currency, interest rate, equity market and credit risks. These instruments are initially recorded and
subsequently carried at fair value. Apart from those derivatives designated as qualifying cash flow hedging instruments, all
changes in fair value are recorded as other financial income (expense).
Other financial liabilities. These are non-derivative financial liabilities. Other financial liabilities are initially recorded at fair
value, less transaction costs, and subsequently carried at amortised cost using the effective interest rate method. Other
financial liabilities are mainly comprised of debt and trade payables.
Debt. Debt instruments are initially recorded at cost, which is the proceeds received, net of transaction costs. Subsequently
they are reported at amortised cost. Any discount between the net proceeds received and the principal value due on
redemption is amortised over the duration of the debt instrument and is recognised as part of financing costs using the
effective interest rate method.
Derecognition. A financial asset is derecognised when the contractual cash flows from the asset expire or when the Group
transfers the rights to receive the contractual cash flows from the financial assets in a transaction in which substantially all the
risks and rewards of ownership of the financial asset are transferred. A financial liability is derecognised when the contractual
obligations are discharged, cancelled or expire.
Impairment of financial assets
The Group recognises loss allowances for expected credit losses (‘ECL’) for financial assets measured at amortised cost and
debt securities measured at fair value through OCI.
For trade and lease receivables the Group measures the allowance for doubtful accounts at an amount equal to lifetime ECL.
For debt securities carried at fair value through OCI and debt securities and other financial assets at amortised cost, which are
determined to have low credit risk based on external credit ratings of the counterparties, the Group measures loss allowances
at an amount equal to 12-month ECL. The Group considers debt securities to have low credit risk when their credit risk rating is
equivalent to the globally understood definition of ‘investment grade’. The Group considers this to be at least Baa3 from Moody’s
and BBB- from Standard & Poor’s. When the credit risk of debt securities carried at fair value through OCI and debt securities
and other financial assets at amortised cost has increased significantly since their initial recognition, the Group measures loss
allowances at an amount equal to lifetime ECL. The Group assumes that the credit risk of such instruments have increased
significantly if they are more than 30 days past due.
Financial assets are written off (either partially or in full) when there is no realistic prospect of recovery. This is generally the
case when the Group determines that the customer does not have assets or sources of income that could generate sufficient
cash flows to repay the amounts subject to the write-off. However, financial assets that are written off are still subject to
enforcement activities in order to comply with the Group’s policy for recovery of amounts due.
Hedge accounting
The Group uses derivatives to manage its exposures to foreign currency, interest rate, equity market and credit risks. The
instruments used may include interest rate swaps, forwards contracts and options. The Group generally limits the use of hedge
accounting to certain significant transactions. To qualify for hedge accounting, the hedging relationship must meet several
strict conditions on eligibility of hedging and hedged instruments, formal designation and documentation, as well as hedge
effectiveness and reliability of measurement. While many of these transactions can be considered as hedges in economic terms,
if the required conditions are not met, then the relationship does not qualify for hedge accounting. In this case the hedging
instrument and the hedged item are reported independently as if there were no hedging relationship, which means that any
derivatives are reported at fair value, with changes in fair value included in other financial income (expense).
Cash flow hedge. This is a hedge of the exposure to variability in cash flows that is attributable to a particular risk associated
with a recognised asset or liability or a highly probable forecasted transaction and could affect profit or loss. The hedging
instrument is recorded at fair value. The effective portion of the hedge is included in other comprehensive income and any
ineffective portion is reported in other financial income (expense). If the hedging relationship is the hedge of the foreign
currency risk of a firm commitment or highly probable forecasted transaction that results in the recognition of a non-financial
item, the cumulative changes in the fair value of the hedging instrument that have been recorded in other comprehensive
income are included in the initial carrying value of the non-financial item at the date of recognition. For all other cash flow
hedges, the cumulative changes in the fair value of the hedging instrument that have been recorded in other comprehensive
income are included in other financial income (expense) when the forecasted transaction affects net income.
Fair value hedge. This is a hedge of the exposure to changes in fair value of a recognised asset or liability, or an unrecognised
firm commitment, or an identified portion of such an asset, liability or firm commitment, that is attributable to a particular risk
and could affect profit or loss. The hedging instrument is recorded at fair value and the hedged item is recorded at its previous
carrying value, adjusted for any changes in fair value that are attributable to the hedged risk. Changes in the fair values are
reported in other financial income (expense).
Taxation
Income taxes include all taxes based upon the taxable profits of the Group, including withholding taxes payable on the
distribution of retained earnings within the Group. Other taxes not based on income, such as business taxes and capital taxes,
are included within selling, general and administration costs.
Liabilities for income taxes, mainly withholding taxes, which could arise on the remittance of retained earnings, principally
relating to subsidiaries, are only recognised where it is probable that such earnings will be remitted in the foreseeable future.
Where the amount of tax liabilities is uncertain, accruals are recorded within income tax liabilities for management’s best
estimate of the ultimate liability that is expected to arise based on the specific circumstances and the Group’s historical
experience.
Deferred tax assets and liabilities are recognised on temporary differences between the tax bases of assets and liabilities
and their carrying values. Deferred tax assets are recognised to the extent that it is probable that future taxable profit will be
available against which the unused tax losses can be utilised.
Current and deferred tax assets and liabilities are offset when the income taxes are levied by the same taxation authority and
when there is a legally enforceable right to offset them. Deferred taxes are determined based on the currently enacted tax
rates applicable in each tax jurisdiction where the Group operates.
Own equity instruments
The Group’s holdings in its own equity instruments are recorded as a deduction from equity. The original purchase cost,
consideration received for subsequent resale of these equity instruments and other movements are reported as changes in
equity. These instruments are held for the Group’s potential conversion obligations that may arise from the Group’s equity
compensation plans.
Changes in accounting policies
In 2023 the Group has implemented various minor amendments to existing standards and interpretations, which have no
material impact on the Group’s overall results and financial position. In addition, the Group has adopted the amendments to
IAS 12 ‘Income Taxes’ relating to ‘International Tax Reform – Pillar Two Model Rules’ issued by the International Accounting
Standards Board (IASB) in May 2023. The Group has applied the exception to recognising and disclosing information about
deferred tax assets and liabilities related to Pillar Two income taxes.
Presentational and cost allocation changes
Presentational and cost allocation changes applied in 2023. Effective 1 January 2023, the Group has made certain
presentational and cost allocation changes to the income statement. This has been done to improve external comparability and
to reflect changes in the internal reporting for functions with global accountability.
∙ The income statement now presents ‘Selling, general and administration’ costs, which is created from merging ‘Marketing and
distribution’ costs and ‘General and administration’ costs.
∙ The income statement now presents ‘Other revenue’ in place of ‘Royalties and other operating income’. Other revenue mainly
includes royalty income, profit-share income, other income from collaboration and out-licensing agreements and interest
income from finance leases.
∙ The income statement now presents ‘Other operating income (expense)’ for non-revenue income and for expenses that do not
fall into the regular functional costs. Amongst others, it includes income from disposal of product rights.
∙ Allocations from functions with global accountability such as informatics, human resources and finance are no longer made to
the Pharmaceuticals and Diagnostics Divisions.
These changes have no impact on sales, operating profit, net income and earnings per share and non-voting equity security of
the Group as a whole. The cost allocation changes will reduce costs allocated to divisions.
Comparative 2022 information has been restated. A reconciliation to the previously published results is provided below.
Restated Roche Group consolidated income statement (selected items) in millions of CHF

As originally Presentational Cost allocation
published changes changes Restated
Group
Sales 63,281 – – 63,281
Royalties and other operating income – until 2022 3,145 (3,145) – –
Other revenue – new from 2023 – 2,533 – 2,533
Cost of sales (20,397) – 660 (19,737)
Marketing and distribution – until 2022 (9,639) 9,639 – –
Research and development (16,023) – 798 (15,225)
General and administration – until 2022 (2,891) 2,891 – –
Selling, general and administration – new from 2023 – (12,743) (1,458) (14,201)
Other operating income (expense) – new from 2023 – 825 – 825
Operating profit 17,476 – – 17,476
Pharmaceuticals
Sales 45,551 – – 45,551
Cost of sales (11,397) – 357 (11,040)
Selling, general and administration – new from 2023 – (8,517) 919 (7,598)
Operating profit 14,814 – 1,952 16,766
Diagnostics
Sales 17,730 – – 17,730
Royalties and other operating income – until 2022 68 (68) – –
Other revenue – new from 2023 – 68 – 68
Cost of sales (9,000) – 303 (8,697)
General and administration – until 2022 (597) 597 – –
Operating profit 3,324 – 825 4,149
Corporate
Selling, general and administration – new from 2023 – (656) (2,777) (3,433)
Other operating income (expense) – new from 2023 – (6) – (6)
Operating profit (662) – (2,777) (3,439)
Consequently, the income from the disposal of products is included in the cash flows from investing activities. Comparative
2022 information has been restated, and a reconciliation to the previously published statement of cash flows is provided below.
Restated Roche Group consolidated statement of cash flows (selected items) in millions of CHF

As originally Presentational
published changes Restated
Disposal of products – until 2022 612 (612) –

Total cash flows from operating activities 18,415 (612) 17,803
Disposal of products – new from 2023 – 612 612

Total cash flows from investing activities (3,536) 612 (2,924)
Presentational changes to be applied in 2024. In October 2023 the Group announced that, effective 1 January 2024, the
Foundation Medicine business will be moved under the responsibility of the Diagnostics Division from the Pharmaceuticals
Division, while retaining Foundation Medicine’s independence in this new reporting set-up. Accordingly from 1 January 2024
the results of the Foundation Medicine business will be reported as part of the Diagnostics Division, and this represents a
change in the Group’s operating segments in its financial reporting. These changes will have no impact on sales, operating
profit, net income and earnings per share and non-voting equity security of the Group as a whole. The operating results of
the divisions will change. No restatements have been made in these Annual Financial Statements for these changes. The
changes will be applied retrospectively from 1 January 2024, and accordingly the 2023 results will be restated in the Interim
and Annual Financial Statements in 2024.
Future new and revised standards
The Group is currently assessing the potential impacts of the various new and revised standards and interpretations that
will be mandatory from 1 January 2024 which the Group has not yet applied. Based on an analysis to date, the Group does
not anticipate that these will have a material impact on the Group’s overall results and financial position. The Group is also
assessing other new and revised standards which are not mandatory until after 2024.
162    Roche Group | Report of Roche Management on Internal Control over Financial Reporting Finance Report 2023
Report of Roche Management on Internal

Control over Financial Reporting
Report of Roche Management on Internal Control over Financial Reporting
The Board of Directors and management of Roche Holding Ltd are responsible for establishing and maintaining adequate
control over financial reporting. The internal control system was designed to provide reasonable assurance over the reliability
of financial reporting and the preparation and fair presentation of consolidated financial statements in accordance with
International Financial Reporting Standards (IFRS Accounting Standards).
All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined
to be effective may not prevent or detect misstatements and can provide only reasonable assurance with respect to financial
statement preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to
the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the
policies or procedures may deteriorate.
Management assessed the effectiveness of its system of internal control over financial reporting as of 31 December 2023 based
on the criteria for effective internal control over financial reporting described in Internal Control – Integrated Framework 2013
issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on this assessment,
management has concluded that the system of internal control over financial reporting was effective as of 31 December 2023.
The Statutory Auditor KPMG AG has audited the consolidated financial statements of Roche Holding Ltd for the year ended
31 December 2023 in accordance with Swiss Auditing Standards and with the International Standards on Auditing (ISA).
Severin Schwan Alan Hippe

Chairman of the Board of Directors Chief Financial Officer
Basel, 29 January 2024

Finance Report 2023 Statutory Auditor’s Report | Roche Group    163
Statutory Auditor’s Report

To the General Meeting of Roche Holding Ltd, Basel
Report on the Audit of the Consolidated Financial Statements
Opinion
We have audited the consolidated financial statements of Roche Holding Ltd and its subsidiaries (the Group), which comprise
the consolidated income statement and consolidated statement of comprehensive income of the Group for the year ended
31 December 2023, the related consolidated balance sheet as at 31 December 2023, the consolidated statement of cash flows
and changes in equity for the year then ended, and notes to the consolidated financial statements including material accounting
policy information.
In our opinion, the consolidated financial statements (pages 46–161) give a true and fair view of the consolidated financial
position of the Group as at 31 December 2023, its consolidated financial performance and its consolidated cash flows for the
year then ended in accordance with IFRS Accounting Standards and comply with Swiss law.
Basis for Opinion
We conducted our audit in accordance with Swiss law, International Standards on Auditing (ISAs) and Swiss Standards on
Auditing (SA-CH). Our responsibilities under those provisions and standards are further described in the “Auditor’s Responsibilities
for the Audit of the Consolidated Financial Statements” section of our report. We are independent of the Group in accordance
with the provisions of Swiss law, together with the requirements of the Swiss audit profession, as well as those of the International
Ethics Standards Board for Accountants’ International Code of Ethics for Professional Accountants (including International
Independence Standards) (IESBA Code), and we have fulfilled our other ethical responsibilities in accordance with these
requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Chargebacks and rebates in the US pharmaceuticals business
Carrying value of product intangible assets not available for use in the Pharmaceuticals Division
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of
the consolidated financial statements of the current period. These matters were addressed in the context of our
audit of the consolidated financial statements as a whole and in forming our opinion thereon, and we do not provide
a separate opinion on these matters.
164    Roche Group | Statutory Auditor’s Report Finance Report 2023
Chargebacks and rebates in the US pharmaceuticals business
Key Audit Matter Our response
The Group’s pharmaceuticals business makes sales to various Our audit procedures included, amongst others, the
customers in the US that fall under certain government and evaluation of the Group’s ability to accurately estimate the
regulatory as well as contractual price reductions. These accrual for chargebacks and rebates in the US pharmaceutical
create obligations for the Group to provide customers with business by comparing deductions from gross sales to
chargebacks or rebate payments and result in deductions from actual claims received from third parties. We developed an
gross amounts invoiced in arriving at sales. The estimated independent estimate of accruals and chargebacks related to
amounts are deducted from gross sales and recorded as certain contractual price reductions and Medicaid using the
accrued liabilities (rebates), or as a deduction from accounts terms of specific rebate programmes and/or contracts with
receivable (chargebacks). These estimates are based on customers, historical revenue data, market demand and market
analyses of existing contractual or legislatively mandated conditions in the US, and historical trends of actual chargebacks
obligations, recent trends and historical experience. and rebate claims paid, and compared the result to the
Group’s estimates.
Management has determined the accruals relating to
chargebacks and rebates in the US pharmaceuticals business, We also evaluated the appropriateness of the Group’s revenue
predominantly contractual price reductions and Medicaid, to recognition accounting policies, including the recognition
be CHF 1,622 million as at 31 December 2023. and measurement of deductions to gross sales relating to
chargebacks and rebates and related disclosures.
We focused on this area because the arrangements are
complex and because establishing an appropriate year-end
position requires judgement and estimation by management.
For further information on chargebacks and rebates in the US pharmaceuticals business refer to the following:
Page 52 (Note 1 General accounting principles – Key accounting judgements, estimates and assumptions), pages 59, 83 and
86 (Note 3 Revenue, Note 12 Accounts receivable and Note 19 Other current liabilities) and page 148 (Note 34 Accounting
policies).
Carrying value of product intangible assets not available for use in the Pharmaceuticals Division
Key Audit Matter Our response
Product intangibles not available for use in the Our audit procedures included, amongst others, on a sample
Pharmaceuticals Division (CHF 10,463 million) mostly basis, challenging the robustness of the key assumptions
represent in-process research and development assets. used to determine the recoverable amounts, including forecast
These were acquired through business combinations, revenues and the discount rate.
asset acquisitions or in-licensing arrangements.
Our challenge was based on our understanding of the
Due to the inherent uncertainties in the research and commercial prospects of the individual products, as well
development processes, intangible assets not available for as the relevant therapeutic areas and the markets in which
use are particularly at risk of impairment. Risks include an they will be launched. We used our valuation specialists to
inability to achieve successful trial results, obtain required assist us in evaluating the assumptions and methodologies
clinical and/or regulatory approvals and a highly competitive used by management in relation to the discount rate. We
business environment in the therapeutic areas where the assessed the key inputs such as projected pricing and
Group has significant assets in research or development. volumes and the products’ projected share of the therapeutic
area, by comparing relevant assumptions to industry forecasts
The impairment assessment requires management to make
and by reviewing analyst commentaries. We compared
assumptions and judgements on the clinical, technical and
management’s assumptions with external data where it was
commercial viability of the new products. Accordingly, we
available. We performed sensitivity analyses over individual
also focused our audit work on these areas.
intangible asset impairment models to assess the levels of
sensitivity to changes in key assumptions so we could focus
our work on those areas and assess management’s allowance
for risk. In addition, we assessed the reasonableness of
management’s assumptions regarding the probability of
obtaining regulatory approval through comparison to industry
practice, history and consideration of the Group’s internal
governance and approval processes.
For further information on the carrying value of product intangible assets not available for use in the Pharmaceuticals Division
refer to the following:
Page 52 (Note 1 General accounting principles – Key accounting judgements, estimates and assumptions), page 78 (Note 10
Intangible assets) and page 148 (Note 34 Accounting policies).
166    Roche Group | Statutory Auditor’s Report Finance Report 2023
Other Information
The Board of Directors is responsible for the other information. The other information comprises the information included in
the finance report and the annual report, but does not include the consolidated financial statements, the stand-alone financial
statements of the company, the remuneration report and our auditor’s reports thereon.
Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of
assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and,
in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our
knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
Board of Directors’ Responsibilities for the Consolidated Financial Statements
The Board of Directors is responsible for the preparation of the consolidated financial statements that give a true and fair view
in accordance with IFRS Accounting Standards and the provisions of Swiss law, and for such internal control as the Board
of Directors determines is necessary to enable the preparation of consolidated financial statements that are free from material
misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, the Board of Directors is responsible for assessing the Group’s ability to
continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis
of accounting unless the Board of Directors either intends to liquidate the Group or to cease operations, or has no realistic
alternative but to do so.
Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are
free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Swiss law,
ISAs and SA-CH will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions
of users taken on the basis of these consolidated financial statements.
As part of an audit in accordance with Swiss law, ISAs and SA-CH, we exercise professional judgement and maintain
professional scepticism throughout the audit. We also:
— Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations,
or the override of internal control.
— Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in
the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
— Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related
disclosures made.
— Conclude on the appropriateness of the Board of Directors’ use of the going concern basis of accounting and, based on
the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant
doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are
required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if
such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to
the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going
concern.
— Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures,
and whether the consolidated financial statements represent the underlying transactions and events in a manner that
achieves fair presentation.
— Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within
the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision
and performance of the Group audit. We remain solely responsible for our audit opinion.
We communicate with the Board of Directors or its relevant committee regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during
our audit.
We also provide the Board of Directors or its relevant committee with a statement that we have complied with relevant ethical
requirements regarding independence, and communicate with them all relationships and other matters that may reasonably be
thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied.
From the matters communicated with the Board of Directors or its relevant committee, we determine those matters that
were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key
audit matters. We describe these matters in our auditor’s report, unless law or regulation precludes public disclosure about
the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report
because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such
communication.
Report on Other Legal and Regulatory Requirements
In accordance with Art. 728a para. 1 item 3 CO and PS-CH 890, we confirm that an internal control system exists, which has been
designed for the preparation of the consolidated financial statements according to the instructions of the Board of Directors.
We recommend that the consolidated financial statements submitted to you be approved.
KPMG AG
François Rouiller Paul Nichols

Licensed Audit Expert
Auditor in Charge
KPMG AG, Grosspeteranlage 5, CH-4002 Basel
© 2024 KPMG AG, a Swiss corporation, is a subsidiary of KPMG Holding AG, which is a member of the KPMG global organization of independent member firms affiliated with
KPMG International Limited, a private English company limited by guarantee. All rights reserved.
168    Roche Group | Multi-Year Overview and Supplementary Information Finance Report 2023
Multi-Year Overview and

Supplementary Information
Multi-year overview
Statistics, as reported
2014 2015 2016

Income statement in millions of CHF
Sales 47,462 48,145 50,576
EBITDA 19,558 19,479 20,483
Operating profit 14,090 13,821 14,069
Net income attributable to Roche shareholders 9,332 8,863 9,576
Research and development 9,895 9,581 11,532
Balance sheet in millions of CHF

Non-current assets 44,426 47,581 48,149
Current assets 31,114 28,182 28,670
Total assets 75,540 75,763 76,819
Non-current liabilities (30,874) (28,695) (27,817)
Current liabilities (23,108) (23,768) (22,600)
Total liabilities (53,982) (52,463) (50,417)
Net assets 21,558 23,300 26,402
Capital and reserves attributable to Roche shareholders 19,586 20,979 23,911
Equity attributable to non-controlling interests 1,972 2,321 2,491
Additions to property, plant and equipment 2,905 4,077 3,790
Personnel
Number of employees at end of year 88,509 91,747 94,052
Key ratios
Net income attributable to Roche shareholders as % of sales 20 18 19
Net income attributable to Roche shareholders as % of equity 48 42 40
Research and development as % of sales 21 20 23
Current ratio % 135 119 127
Equity and non-controlling interests as % of total assets 29 31 34
Human capital return on investment ratio 2.16 2.06 2.06
Data on shares and non-voting equity securities

Number of shares 160,000,000 160,000,000 160,000,000
Number of non-voting equity securities (Genussscheine) 702,562,700 702,562,700 702,562,700
Total shares and non-voting equity securities 862,562,700 862,562,700 862,562,700
Total dividend in millions of CHF 6,901 6,987 7,073
Earnings per share and non-voting equity security (diluted) in CHF 10.81 10.28 11.13
Dividend per share and non-voting equity security in CHF 8.00 8.10 8.20
Information in this table is stated as reported and changes in accounting policies arising from changes in IFRS Accounting Standards are not applied retrospectively.
Finance Report 2023 Multi-Year Overview and Supplementary Information | Roche Group    169
2017 2018 2019 2020 2021 2022 2023
53,299 56,846 61,466 58,323 62,801 63,281 58,716

21,201 22,825 25,419 24,281 24,692 25,015 21,976
13,003 14,769 17,548 18,543 18,155 17,476 15,395
8,633 10,500 13,497 14,295 13,930 12,421 11,498
11,292 12,092 12,774 13,009 14,799 15,225 14,200
45,104 46,273 51,837 53,196 56,690 54,335 57,022

31,572 32,244 31,254 32,942 35,627 33,816 33,446
76,676 78,517 83,091 86,138 92,317 88,151 90,468
(25,509) (25,118) (23,105) (20,964) (25,556) (28,897) (32,381)
(22,160) (23,033) (24,119) (25,401) (38,416) (27,239) (24,824)
(47,669) (48,151) (47,224) (46,365) (63,972) (56,136) (57,205)
29,007 30,366 35,867 39,773 28,345 32,015 33,263
26,441 27,622 32,747 36,341 24,489 27,992 29,315
2,566 2,744 3,120 3,432 3,856 4,023 3,948
3,477 3,796 3,479 3,693 3,826 3,402 3,770
93,734 94,442 97,735 101,465 100,920 103,613 103,605
16 19 22 25 22 20 20
33 38 41 39 57 44 39
21 21 21 22 24 24 24
142 140 130 130 93 124 135
38 39 43 46 31 36 37
1.89 1.96 2.07 2.18 2.08 2.08 1.93
160,000,000 160,000,000 160,000,000 160,000,000 160,000,000 106,691,000 106,691,000

702,562,700 702,562,700 702,562,700 702,562,700 702,562,700 702,562,700 702,562,700
862,562,700 862,562,700 862,562,700 862,562,700 862,562,700 809,253,700 809,253,700
7,159 7,504 7,763 7,849 7,526 7,688 7,769 a)
10.04 12.21 15.62 16.52 16.20 15.37 14.31
8.30 8.70 9.00 9.10 9.30 9.50 9.60 a)
a) 2023 dividend proposed by the Board of Directors.

Sales by division in millions of CHF
2019 2020 2021 2022 2023

Pharmaceuticals 48,516 44,532 45,041 45,551 44,612
Diagnostics 12,950 13,791 17,760 17,730 14,104
Total 61,466 58,323 62,801 63,281 58,716
Sales by geographical area in millions of CHF
2019 2020 2021 2022 2023

Switzerland 590 670 731 683 679
Germany 3,050 3,323 4,292 3,295 2,867
Rest of Europe 9,654 9,780 11,375 10,326 9,703
Europe 13,294 13,773 16,398 14,304 13,249
United States 29,724 27,187 26,519 27,939 27,183

Rest of North America 985 882 915 1,101 837
North America 30,709 28,069 27,434 29,040 28,020
Latin America 2,858 2,393 2,746 2,870 2,971
Japan 4,545 4,156 4,999 5,695 4,374

Rest of Asia 8,701 8,614 9,749 9,852 8,890
Asia 13,246 12,770 14,748 15,547 13,264
Africa, Australia and Oceania 1,359 1,318 1,475 1,520 1,212

Total 61,466 58,323 62,801 63,281 58,716
Additions to property, plant and equipment by division in millions of CHF
2019 2020 2021 2022 2023

Pharmaceuticals 1,864 2,141 2,134 1,694 1,970
Diagnostics 1,552 1,502 1,628 1,622 1,716
Corporate 63 50 64 86 84
Total 3,479 3,693 3,826 3,402 3,770
Additions to property, plant and equipment by geographical area in millions of CHF
2019 2020 2021 2022 2023

Switzerland 754 754 857 639 561
Germany 459 515 635 668 612
Rest of Europe 339 345 344 278 309
Europe 1,552 1,614 1,836 1,585 1,482
United States 900 987 925 881 1,276

Rest of North America 3 2 2 3 5
North America 903 989 927 884 1,281
Latin America 120 106 116 138 192
Japan 502 668 609 456 448

Rest of Asia 367 291 293 299 323
Asia 869 959 902 755 771
Africa, Australia and Oceania 35 25 45 40 44

Total 3,479 3,693 3,826 3,402 3,770
Alternative Performance Measures
The financial information included in the Financial Review includes certain Alternative Performance Measures (APMs) which
are not accounting measures as defined by IFRS Accounting Standards, in particular the core results, net working capital,
net operating assets, free cash flow and constant exchange rates. These APMs should not be used instead of, or considered
as alternatives to, the Group’s consolidated financial results based on IFRS Accounting Standards. These APMs may not be
comparable to similarly titled measures disclosed by other companies. All APMs presented in the Financial Review relate to the
performance of the current year and comparative periods.
Core results
Core results allow for an assessment of both the Group’s actual results as defined by IFRS Accounting Standards and the
underlying performance of the business. The core results concept, which is used in the internal management of the business,
is based on the IFRS results, with the following adjustments:
∙ Global restructuring plans (see Note 7) are excluded.
∙ Amortisation and impairment of intangible assets (see Note 10), with the exception of commercial software intangible assets,
and impairment of goodwill (see Note 9) are excluded.
∙ Acquisition accounting and other impacts from the accounting for mergers and acquisitions (M&A) and alliance transactions
(see Financial Review) are excluded.
∙ Discontinued operations (currently none) are excluded.
∙ Legal and environmental cases (see Financial Review) are excluded.
∙ Global issues outside the healthcare sector beyond the Group’s control are excluded.
∙ Material treasury items such as major debt restructurings (currently none) are excluded.
∙ Pension plan settlements (see Note 26) are excluded.
∙ The tax benefit recorded under IFRS Accounting Standards in respect of equity compensation plans (ECPs), which varies
according to the price of the underlying equity, is replaced by a normalised tax benefit, being the IFRS 2 expense multiplied by
the applicable tax rate (see Note 5).
The Group’s IFRS results, including the divisional breakdown, are reconciled to the core results in the tables below. The calculation
of Core EPS is also given in the tables below. Additional commentary to the adjustment items is given in the Financial Review.
Core results reconciliation – 2023 in millions of CHF
M&A and Legal and Pension Normal

Global Intangibles alliance environ- plan isation of
IFRS restruc- amort Intangibles trans mental settle Global ECP tax Core
results turing isation impairment actions cases ments issues benefit results
Sales 58,716 – – – – – – – – 58,716
Other revenue 1,725 0 – – – – – – – 1,725
Cost of sales (16,357) 548 375 183 0 – – – – (15,251)
Research and development (14,200) 230 308 425 – – – – – (13,237)
Selling, general and
administration (14,881) 1,335 28 0 – – – – – (13,518)
Other operating income
(expense) 392 (75) – 591 19 (122) 0 – – 805
Operating profit 15,395 2,038 711 1,199 19 (122) 0 – – 19,240
Financing costs (996) 0 – – 6 10 – – – (980)

Other financial income
(expense) (320) – – – 0 – – – – (320)
Profit before taxes 14,079 2,038 711 1,199 25 (112) 0 – – 17,940
Income taxes (1,721) (403) (44) (71) (4) 39 0 0 68 (2,136)

Net income 12,358 1,635 667 1,128 21 (73) 0 0 68 15,804
Attributable to
– Roche shareholders 11,498 1,626 664 1,123 21 (73) 0 0 68 14,927
– Non-controlling interests 860 9 3 5 – 0 0 0 – 877
Core results reconciliation – 2022 (restated) a) in millions of CHF
M&A and Legal and Pension Normal

Global Intangibles alliance environ- plan isation of
IFRS restruc- amort Intangibles trans mental settle Global ECP tax Core
results turing isation impairment actions cases ments issues benefit results
Sales 63,281 – – – – – – – – 63,281
Other revenue 2,533 0 – – – – – – – 2,533
Cost of sales (19,737) 295 555 1,472 0 – – – – (17,415)
Research and development (15,225) 261 344 1,365 – – – – – (13,255)
Selling, general and
administration (14,201) 400 34 0 – – – – – (13,767)
Other operating income
(expense) 825 13 – 0 (20) (22) 0 – – 796
Operating profit 17,476 969 933 2,837 (20) (22) 0 – – 22,173
Financing costs (665) 0 – – (1) (20) – – – (686)

(expense) (484) – – – (44) – – – – (528)
Profit before taxes 16,327 969 933 2,837 (65) (42) 0 – – 20,959
Income taxes (2,796) (193) (80) (435) (1) 8 0 0 68 (3,429)

Net income 13,531 776 853 2,402 (66) (34) 0 0 68 17,530
Attributable to
– Roche shareholders 12,421 761 849 2,402 (66) (34) 0 0 68 16,401
– Non-controlling interests 1,110 15 4 0 – 0 0 0 – 1,129
a) Effective 1 January 2023, the Group has made certain presentational and cost allocation changes to the income statement. Details and a reconciliation to the previously
published income statement are disclosed in Note 34 of the Annual Financial Statements. A reconciliation to the previously published core results is disclosed below.
Divisional core results reconciliation – 2023 in millions of CHF
M&A and Legal and Pension

Global Intangibles alliance environ- plan
IFRS restruc- amort Intangibles trans mental settle Core
results turing isation impairment actions cases ments results
Pharmaceuticals
Sales 44,612 – – – – – – 44,612
Other revenue 1,667 0 – – – – – 1,667
Cost of sales (9,083) 316 241 183 0 – – (8,343)
Research and development (12,352) 155 301 406 – – – (11,490)
Selling, general and administration (7,945) 721 9 0 – – – (7,215)
Other operating income (expense) 233 (80) – 591 14 0 0 758
Operating profit 17,132 1,112 551 1,180 14 0 0 19,989
Diagnostics
Sales 14,104 – – – – – – 14,104
Other revenue 58 0 – – – – – 58
Cost of sales (7,274) 232 134 0 0 – – (6,908)
Research and development (1,848) 75 7 19 – – – (1,747)
Other operating income (expense) 173 6 – 0 5 (124) 0 60
Operating profit 2,171 437 160 19 5 (124) 0 2,668
Corporate
Selling, general and administration (3,894) 490 – – – – – (3,404)
Other operating income (expense) (14) (1) – – 0 2 0 (13)
Operating profit (3,908) 489 – – 0 2 0 (3,417)
Divisional core results reconciliation – 2022 (restated) a) in millions of CHF
M&A and Legal and Pension

Global Intangibles alliance environ- plan
IFRS restruc- amort Intangibles trans mental settle Core
results turing isation impairment actions cases ments results
Pharmaceuticals
Sales 45,551 – – – – – – 45,551
Other revenue 2,465 0 – – – – – 2,465
Cost of sales (11,040) 251 412 1,472 0 – – (8,905)
Research and development (13,384) 263 336 1,365 – – – (11,420)
Other operating income (expense) 772 14 – 0 (6) (16) 0 764
Operating profit 16,766 789 761 2,837 (6) (16) 0 21,131
Diagnostics
Sales 17,730 – – – – – – 17,730
Other revenue 68 0 – – – – – 68
Cost of sales (8,697) 44 143 0 0 – – (8,510)
Research and development (1,841) (2) 8 0 – – – (1,835)
Other operating income (expense) 59 0 – 0 (14) (2) 0 43
Operating profit 4,149 76 172 0 (14) (2) 0 4,381
Corporate
Selling, general and administration (3,433) 105 – – – – – (3,328)
Other operating income (expense) (6) (1) – – 0 (4) 0 (11)
Operating profit (3,439) 104 – – 0 (4) 0 (3,339)
a) Effective 1 January 2023, the Group has made certain presentational and cost allocation changes to the income statement. Details and a reconciliation to the previously
published income statement are disclosed in Note 34 of the Annual Financial Statements. A reconciliation to the previously published divisional core results is disclosed
below.
Restated core results (selected items) – 2022 in millions of CHF

Core results as Presentational Cost allocation Restated
originally published changes changes core results
Group
Sales 63,281 – – 63,281
Cost of sales (18,075) – 660 (17,415)
Selling, general and administration – new from 2023 – (12,309) (1,458) (13,767)
Operating profit 22,173 – – 22,173
Pharmaceuticals
Sales 45,551 – – 45,551
Cost of sales (9,262) – 357 (8,905)
Operating profit 19,172 – 1,959 21,131
Diagnostics
Sales 17,730 – – 17,730
Royalties and other operating income – until 2022 68 (68) – –
Other revenue – new from 2023 – 68 – 68
Cost of sales (8,813) – 303 (8,510)
Operating profit 3,556 – 825 4,381
Corporate
Selling, general and administration – new from 2023 – (544) (2,784) (3,328)
Other operating income (expense) – new from 2023 – (11) – (11)
Operating profit (555) – (2,784) (3,339)
Core EPS (basic)
2023 2022
Core net income attributable to Roche shareholders (CHF millions) 14,927 16,401
Weighted average number of outstanding shares and non-voting equity securities used to calculate
basic earnings per share (millions) 29 799 800
Core earnings per share (basic) (CHF) 18.69 20.49
Core EPS (diluted)
2023 2022
Core net income attributable to Roche shareholders (CHF millions) 14,927 16,401
Increase in non-controlling interests’ share of core net income, assuming all outstanding Chugai stock
options exercised (CHF millions) 0 (1)
Net income used to calculate diluted earnings per share (CHF millions) 14,927 16,400
calculate diluted earnings per share (millions) 29 804 808
Core earnings per share (diluted) (CHF) 18.57 20.30
Free cash flow
Free cash flow is used to assess the Group’s ability to generate the cash required to conduct and maintain its operations.
It also indicates the Group’s ability to generate cash to finance dividend payments, repay debt and to undertake merger and
acquisition activities. The free cash flow concept is used in the internal management of the business.
Operating free cash flow is calculated based on the IFRS operating profit and adjusted for certain non-cash items, movements
in net working capital and capital expenditures (investments in property, plant and equipment and intangible assets as well
as the principal portion of lease liabilities paid for leased assets). Operating free cash flow is different from cash flows from
operating activities as defined by IAS 7 in that it includes capital expenditures (which are within the responsibility of divisional
management) and excludes income taxes paid (which are not within the responsibility of divisional management). Cash outflows
from defined benefit plans are allocated to the operating free cash flow based on the current service cost with the residual
allocated to treasury activities.
Free cash flow is calculated as the operating free cash flow adjusted for treasury activities and taxes paid. Free cash flow is
different from total cash flows as defined by IAS 7 in that it excludes dividend payments, cash inflows/outflows from financing
activities such as issuance/repayment of debt, purchase/sale of marketable securities and cash inflows/outflows from mergers,
acquisitions and divestments.
Operating free cash flow and free cash flow are calculated as shown in the tables below. Additional commentary to the
adjustment items is given in the Financial Review.
Operating free cash flow reconciliation in millions of CHF
2023 2022
Cash flows from operating activities (IFRS basis in accordance with IAS 7) 16,095 17,803
Add back
– Income taxes paid 3,620 4,102
Deduct
– Investments in property, plant and equipment (3,742) (3,449)
– Principal portion of lease liabilities paid (339) (405)
– Investments in intangible assets (907) (1,103)
– Disposal of property, plant and equipment 173 82
– Disposal of intangible assets 0 0
– Disposal of products 558 612
– Add back total payments for defined benefit plans 743 655
– Deduct allocation of payments to operating free cash flow (456) (630)
Acquisition-related items, including transaction costs 23 6
Other operating items 0 0
Operating free cash flow 15,768 17,673
Effective 1 January 2023, certain line items in the statement of cash flows for 2022 have been reclassified following certain presentational changes the Group made. Details
and a reconciliation to the previously published statement of cash flows are disclosed in Note 34 of the Annual Financial Statements.
Free cash flow reconciliation in millions of CHF
2023 2022
Cash flows from operating activities (IFRS basis in accordance with IAS 7) 16,095 17,803
Deduct
– Investments in property, plant and equipment (3,742) (3,449)
– Principal portion of lease liabilities paid (339) (405)
– Investments in intangible assets (907) (1,103)
– Disposal of property, plant and equipment 173 82
– Disposal of intangible assets 0 0
– Disposal of products 558 612
– Interest paid (770) (557)
Other operating items, including acquisition-related items 23 6
Other treasury items 197 52
Free cash flow 11,288 13,041
Effective 1 January 2023, certain line items in the statement of cash flows for 2022 have been reclassified following certain presentational changes the Group made. Details
and a reconciliation to the previously published statement of cash flows are disclosed in Note 34 of the Annual Financial Statements.
Supplementary information used to calculate the divisional operating free cash flow is shown in the table below.
Divisional operating free cash flow information in millions of CHF

2023 2022 2023 2022 2023 2022 2023 2022
Depreciation, amortisation and impairment
Depreciation of property, plant and equipment 1,263 1,381 1,095 1,128 65 56 2,423 2,565
Depreciation of right-of-use assets 197 211 116 117 12 13 325 341
Amortisation of intangible assets 554 764 162 174 – – 716 938
Impairment (reversal) of property, plant and
equipment 277 108 73 15 0 0 350 123
Impairment (reversal) of right-of-use assets 319 5 0 0 0 0 319 5
Impairment of goodwill 591 0 0 0 – – 591 0
Impairment of intangible assets 589 2,837 19 0 – – 608 2,837
Total 3,790 5,306 1,465 1,434 77 69 5,332 6,809
Other adjustments
Add back
– Expenses for equity-settled equity compensation
plans 634 560 113 102 83 76 830 738
– Net (income) expense for provisions 294 495 201 19 77 0 572 514
– Net (gain) loss from disposals (619) (606) 15 11 0 (9) (604) (604)
– Non-cash working capital and other items 336 138 302 331 1 0 639 469
Deduct
– Utilisation of provisions (800) (743) (202) (244) (30) (61) (1,032) (1,048)
– Proceeds from disposals 681 618 49 49 1 27 731 694
Total 526 462 478 268 132 33 1,136 763
Operating profit cash adjustments 4,316 5,768 1,943 1,702 209 102 6,468 7,572
Effective 1 January 2023, the Group has made certain presentational and cost allocation changes to the income statement affecting the divisional expenses for equity-
settled equity compensation plans included in this table. The comparative information for 2022 has been restated accordingly.
EBITDA
The Group does not use Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) in either its internal management
reporting or its external communications. In the opinion of the Group’s management, operating free cash flow gives a more
useful and consistent measurement of ‘cash earnings’ than EBITDA, which includes many non-cash items such as provisions,
allowances for trade receivables and inventories, and certain non-cash entries arising from acquisition accounting and pension
accounting. Operating free cash flow also includes the cash used for investments in property, plant and equipment, leased
assets and intangible assets, whereas EBITDA excludes all costs and cash outflows for these items.
For the convenience of those readers who do use EBITDA, this is provided in the table below. As the starting point this uses the
core results, which already exclude the amortisation and impairment of goodwill and intangible assets.
EBITDA (using core results) in millions of CHF

2023 2022 2023 2022 2023 2022 2023 2022
EBITDA
Core operating profit 19,989 21,131 2,668 4,381 (3,417) (3,339) 19,240 22,173
Depreciation and impairment of property, plant and
equipment – Core basis 1,243 1,310 1,097 1,130 65 56 2,405 2,496
Depreciation and impairment of right-of-use assets –
Core basis 198 211 116 117 12 13 326 341
Amortisation and impairment of commercial software
intangible assets – Core basis 3 3 2 2 – – 5 5
EBITDA 21,433 22,655 3,883 5,630 (3,340) (3,270) 21,976 25,015
– Margin, % of sales 48.0 49.7 27.5 31.8 – – 37.4 39.5
Effective 1 January 2023, the Group has made certain presentational and cost allocation changes to the income statement. Details and a reconciliation to the previously
published income statement are disclosed in Note 34 of the Annual Financial Statements. A reconciliation to the previously published divisional core results is disclosed above.
Net operating assets
Net operating assets allow for an assessment of the Group’s operating performance of the business independently from financing
and tax activities. Net operating assets are calculated as property, plant and equipment, leased assets (‘right-of-use assets’),
goodwill, intangible assets, net working capital and long-term net operating assets minus provisions.
The calculation of the net operating assets disclosed in Note 2 of the Annual Financial Statements is shown in the tables below.
Net operating assets reconciliation – 2023 in millions of CHF

Treasury and
Pharmaceuticals Diagnostics Corporate taxation Group
Property, plant and equipment 14,423 6,997 304 – 21,724
Right-of-use assets 882 299 34 – 1,215
Goodwill 4,767 4,623 – – 9,390
Intangible assets 13,258 1,570 – – 14,828
Inventories 4,849 2,900 – – 7,749
Provisions (1,799) (766) (178) – (2,743)
Current income tax net liabilities – – – (1,913) (1,913)
Deferred tax net assets – – – 6,289 6,289
Defined benefit plan net liabilities – – – (3,360) (3,360)
Lease liabilities – – – (1,573) (1,573)
Marketable securities – – – 5,134 5,134
Cash and cash equivalents – – – 5,376 5,376
Debt – – – (29,209) (29,209)
Other net assets (liabilities)
– Net working capital (1,403) 348 (487) – (1,542)
– Other long-term net operating assets 1,529 (33) (2) – 1,494
– Other – – – 404 404
Total net assets 36,506 15,938 (329) (18,852) 33,263
Net operating assets reconciliation – 2022 in millions of CHF

Treasury and
Pharmaceuticals Diagnostics Corporate taxation Group
Property, plant and equipment 15,788 7,016 271 – 23,075
Right-of-use assets 845 239 49 – 1,133
Goodwill 5,810 5,010 – – 10,820
Intangible assets 7,866 1,819 – – 9,685
Inventories 5,259 3,346 – – 8,605
Provisions (2,392) (832) (135) – (3,359)
Current income tax net liabilities – – – (2,874) (2,874)
Deferred tax net assets – – – 5,782 5,782
Defined benefit plan net liabilities – – – (3,604) (3,604)
Lease liabilities – – – (1,193) (1,193)
Marketable securities – – – 4,776 4,776
Cash and cash equivalents – – – 4,991 4,991
Debt – – – (25,351) (25,351)
Other net assets (liabilities)
– Net working capital (1,468) (78) (337) – (1,883)
– Other long-term net operating assets 848 (2) (3) – 843
– Other – – – 569 569
Total net assets 32,556 16,518 (155) (16,904) 32,015
Net debt
Net debt is used to monitor the Group’s overall short- and long-term liquidity. Net debt is calculated as the sum of total long-term
and short-term debt less marketable securities, cash and cash equivalents.
Net debt calculations, including details of movements during the current year, are shown in the table on page 37 in the Financial
Review.
Net working capital
Net working capital is used to assess the Group’s efficiency in utilising assets and short-term liquidity. Net trade working capital
is calculated as trade receivables and inventories minus trade payables. Net working capital is calculated as net trade working
capital adjusted for other receivables and other payables.
Net working capital and net trade working capital calculations are shown in the tables on page 23 (Pharmaceuticals Division),
page 29 (Diagnostics Division) and page 31 (Corporate) in the Financial Review.
Constant exchange rates
Certain percentage changes in the Financial Review have been calculated using constant exchange rates (CER) which allow for
an assessment of the Group’s financial performance with the effects of exchange rate fluctuations eliminated. The percentage
changes at constant exchange rates are calculated using simulations by reconsolidating both the current reported period and
the prior period numbers at constant currency exchange rates, equalling the average exchange rates for the prior year. For
example, a CER change between a 2023 line item and its 2022 equivalent is calculated using the average exchange rate for the
year ended 31 December 2022 for both the 2023 line item and the 2022 line item and subsequently calculating the change in
percent with respect to the two recalculated numbers.
Foreign exchange gains and losses and the gains (losses) on the net monetary positions in hyperinflationary economies are
excluded from the calculation of CER growth rates in the earnings per share disclosures. In countries where there is a significant
devaluation in the local currency in the current year, the simulations use the average exchange rate of the current year instead
of the prior year to avoid that CER growth rates are artificially inflated.
Finance Report 2023 Roche Securities | Roche Group    181
Roche Securities
Price development of share in CHF
2019 2020 2021 2022 2023
400
350
300
250
200
150
100
50
0
Roche share Swiss Market Index (rebased)
Price development of non-voting equity security (Genussschein) in CHF
2019 2020 2021 2022 2023
400
350
300
250
200
150
100
50
0
Roche non-voting equity security Swiss Market Index (rebased)
Price development of American Depositary Receipt (ADR) in USD
2019 2020 2021 2022 2023
60
50
40
30
20
10
0
Roche ADR Standard & Poor’s 500 Index (rebased)
Eight Roche American Depositary Receipts (ADRs) are equivalent to one non-voting equity security (Genussschein). ADRs have been traded in the US over-the-counter market
since July 1992.
182    Roche Group | Roche Securities Finance Report 2023
Number of shares and non-voting equity securities a)
2019 2020 2021 2022 2023

Number of shares (nominal value: CHF 1.00) 160,000,000 160,000,000 160,000,000 106,691,000 106,691,000
Number of non-voting equity securities (Genussscheine)
(no nominal value) 702,562,700 702,562,700 702,562,700 702,562,700 702,562,700
Total issued 862,562,700 862,562,700 862,562,700 809,253,700 809,253,700
Number of own shares and non-voting equity securities
(Genussscheine) held (6,806,245) (9,436,750) (62,159,409) (10,073,029) (12,011,755)
Total outstanding 855,756,455 853,125,950 800,403,291 799,180,671 797,241,945
Following the closing of the share repurchase transaction on 6 December 2021, the number of own shares and non-voting
equity securities (Genussscheine) held by the Roche Group at 31 December 2021 as summarised in the table above included
53,309,000 bearer shares which were cancelled in February 2022. Further details can be found in Note 22 of the Roche Group
Consolidated Financial Statements.
Data per share and non-voting equity security in CHF
2019 2020 2021 2022 2023

Earnings (basic) 15.77 16.73 16.38 15.52 14.40
Earnings (diluted) 15.62 16.52 16.20 15.37 14.31
Core earnings (basic) 20.35 19.40 20.04 20.49 18.69
Core earnings (diluted) 20.16 19.16 19.81 20.30 18.57
Equity attributable to Roche shareholders 38.27 42.60 30.60 35.03 36.77
Dividend 9.00 9.10 9.30 9.50 9.60 c)
Stock price of share b) Opening 239.40 307.60 310.00 408.80 358.40
High 312.20 352.20 420.00 433.00 362.20
Low 239.40 267.40 303.80 343.00 247.20
Year-end 307.60 310.00 408.80 358.40 261.40
Stock price of non-voting equity security
(Genussschein) b) Opening 243.40 314.00 309.00 379.10 290.50
High 317.25 354.05 383.60 400.55 297.80
Low 243.40 274.45 297.05 290.50 233.85
Year-end 314.00 309.00 379.10 290.50 244.50
a) Each non-voting equity security (Genussschein) confers the same rights as any of the shares to participate in the available earnings and any remaining proceeds from
liquidation following repayment of the nominal value of the shares and the participation certificate capital (if any). Shares and non-voting equity securities are listed on
the SIX Swiss Exchange. Roche Holding Ltd has no restrictions as to ownership of its shares or non-voting equity securities.
b) All stock price data reflect daily closing prices.
c) 2023 dividend proposed by the Board of Directors.
Market capitalisation in millions of CHF
2019 2020 2021 2022 2023

Year-end 267,684 263,776 306,601 239,405 196,720
Finance Report 2023 Roche Securities | Roche Group    183
Key ratios (year-end)
2019 2020 2021 2022 2023

Dividend yield of shares in % 2.9 2.9 2.3 2.7 3.7
Dividend yield of non-voting equity securities (Genussscheine) in % 2.9 2.9 2.5 3.3 3.9
Price/earnings of shares 20 19 25 23 18
Price/earnings of non-voting equity securities (Genussscheine) 20 19 23 19 17
Stock codes
Share Non-voting equity security American Depositary Receipt (ADR)

SIX Swiss Exchange RO ROG –
Bloomberg RO SW ROG VX RHHBY US
Reuters RO.S ROG.VX RHHBY.PK
184    Roche Holding Ltd, Basel Finance Report 2023
Roche Holding Ltd, Basel
Financial Statements 185

Notes to the Financial Statements 187
1.
Principles and information on balance sheet 4. Significant shareholders 190
and income statement items 187 5. Full-time equivalent employees 190
2. Shareholders’ equity 188 6. Board and Executive shareholdings 191
3. Contingent liabilities 190
Appropriation of Available Earnings 194

Finance Report 2023 Financial Statements | Roche Holding Ltd, Basel    185
Financial Statements
Balance sheet in millions of CHF
31 December 2023 31 December 2022

Current assets
Cash and cash equivalents 63 681
Marketable securities 50 133
Accounts receivable from Group companies 4,522 5,300
Other short-term receivables 1 1
Total current assets 4,636 6,115
Non-current assets
Investments 8,582 9,088
Total non-current assets 8,582 9,088
Total assets 13,218 15,203
Short-term liabilities
Accounts payable to Group companies 7 3
Interest-bearing liabilities to Group companies 0 2,547
Other short-term liabilities 13 59
Total short-term liabilities 20 2,609
Long-term liabilities
Provisions 35 35
Total long-term liabilities 35 35
Total liabilities 55 2,644
Shareholders’ equity
Share capital 107 107
Non-voting equity securities (Genussscheine) p. m. p. m.
Legal retained earnings:
– Statutory retained earnings reserves 300 300
– Reserves for own equity instruments held by subsidiaries 3,322 0
Available earnings:
– Balance brought forward from previous year 1,142 937
– Net income for the year 8,292 11,215
Own equity instruments 0 0
Total shareholders’ equity 13,163 12,559
Total shareholders’ equity and liabilities 13,218 15,203
p. m. = pro memoria. Non-voting equity securities (Genussscheine) have no nominal value.

186    Roche Holding Ltd, Basel | Financial Statements Finance Report 2023
Income statement in millions of CHF

2023 2022
Income
Income from investments (dividend income) 8,736 10,682
– Interest income 13 24
– Income from marketable securities and other 9 83
Guarantee fee income from Group companies 63 67
Other income 57 558
Total income 8,878 11,414
Expenses
Administration expenses (41) (49)
Other expenses (521) (71)
Financial expenses (14) (16)
Direct taxes (10) (63)
Total expenses (586) (199)
Net income 8,292 11,215

Finance Report 2023 Notes to the Financial Statements | Roche Holding Ltd, Basel    187
Notes to the Financial Statements
1. P
rinciples and information on balance sheet and
income statement items
Basis of preparation
The financial statements of Roche Holding Ltd, Basel, (the ‘Company’) have been prepared in accordance with the principles
of Swiss Law on Accounting and Financial Reporting (32nd title of the Swiss Code of Obligations, ‘CO’). Where not prescribed by
law, the significant accounting and valuation principles applied are described below.
The Company has prepared its consolidated financial statements in accordance with a recognised accounting standard, the
International Financial Reporting Standards (IFRS Accounting Standards). In accordance with the CO, the Company decided to
forgo presenting additional information on audit fees in the notes as well as a cash flow statement.
Valuation methods and translation of foreign currencies
Marketable securities are reported at the lower of cost or market value. All other financial assets, including investments, are
reported at cost less appropriate write-downs. Own equity instruments are recognised at cost and deducted from equity at the
time of purchase. If the own equity instruments are sold, the gain or loss is recognised through the income statement. Assets
and liabilities denominated in foreign currencies are translated into Swiss francs using year-end rates of exchange, except
investments which are translated at historical rates. Transactions during the year which are denominated in foreign currencies
are translated at the exchange rates effective at the relevant transaction dates. Resulting exchange gains and losses are
recognised in the income statement with the exception of unrealised gains which are deferred.
Investments
The direct and indirect investments of the Company into subsidiaries are listed in Note 33 to the Roche Group Annual Financial
Statements. This listing excludes Chugai’s subsidiaries as well as companies that are not material, notably companies that are
inactive, dormant or in liquidation. Ownership interests equal voting rights.
Own equity instruments, including treasury shares
Own equity instruments, including treasury shares, are recognised at the purchase price and deducted from shareholders’
equity at the time of the purchase. In case of a resale, the gain or loss is recognised through other financial income or financial
expenses. Upon cancellation of bearer shares repurchased, such shares are derecognised with a corresponding decrease of
share capital for the nominal value of the cancelled shares and of available earnings for any exceeding amount. No dividend
distributions are made for own equity instruments held by the Company, including treasury shares.
Taxes
Direct taxes include corporate income and capital taxes.
Other income
In 2022 other income related to a reversal of an allowance for a loan receivable and previously recorded impairments for
investments. This other income included CHF 289 million from a release of hidden reserves which had already been taxed in
prior years.
Other expenses
In 2023 and 2022 other expenses mainly consisted of an impairment for an investment due to a dividend payment.
188    Roche Holding Ltd, Basel | Notes to the Financial Statements Finance Report 2023
2. Shareholders’ equity
Share repurchase and share capital reduction
On 26 November 2021, an Extraordinary General Meeting of the Company’s shareholders approved a share capital reduction by
CHF 53.3 million from CHF 160.0 million to CHF 106.7 million through the cancellation of all such shares to be repurchased from
Novartis. On 6 December 2021, the Company repurchased 53,309,000 bearer shares, with a nominal value of CHF 1.00 each,
held by Novartis for a total consideration of CHF 19.0 billion. At 31 December 2021, the repurchased shares were reported
as treasury shares at the repurchase price, excluding transaction costs. These shares were cancelled in February 2022
when the necessary legal procedures had been completed. Upon cancellation of these shares, the Company’s share capital
decreased by CHF 53.3 million from CHF 160.0 million to CHF 106.7 million. The reduction in the share capital became effective
at the beginning of February 2022, with the entry of the share capital reduction in the commercial register of the Canton of
Basel-Stadt on 3 February 2022 and the publication of the share capital reduction in the Swiss Official Gazette of Commerce
on 8 February 2022. The CHF 19.0 billion bridge loan facility drawn in December 2021 to finance the share repurchase was fully
repaid by May 2022. At 31 December 2021 the amount of the bridge loan facility outstanding was CHF 13.5 billion.
Share capital
Following the share capital reduction in 2022 as described above, at 31 December 2023 and 2022 share capital amounted to
CHF 106.7 million. The share capital consists of 106,691,000 bearer shares with a nominal value of CHF 1.00 each, as in the
preceding year. Included in equity are 702,562,700 non-voting equity securities (Genussscheine). They are not part of the share
capital and confer no voting rights. However, each non-voting equity security confers the same rights as any of the shares to
participate in the available earnings and in any remaining proceeds from liquidation following repayment of the nominal value of
the share capital and, if any, participation certificates.
Own equity instruments, including treasury shares
At 31 December 2021 the Company held 53,309,000 bearer shares as treasury shares which had been repurchased for a total
consideration of CHF 19.0 billion. The repurchase price, excluding transaction costs, was deducted from shareholders’ equity.
As described above, all the 53,309,000 bearer shares held as treasury shares were cancelled in February 2022 when the
necessary legal procedures had been completed. At 31 December 2023 the Company did not hold any shares (2022: none).
During 2023 and 2022 the Company neither purchased nor sold bearer shares.
At 31 December 2023 the Company did not hold any non-voting equity securities (2022: none). During 2023 and 2022 the
Company neither purchased nor sold non-voting equity securities.
Article 659b of the revised Swiss Code of Obligations (CO) effective as of 1 January 2023 requires the creation of an additional
legal reserve for own equity instruments held by subsidiaries over which the Company as parent company of the Roche Group
has control, including foundations as included in the IFRS consolidation scope which did not qualify as subsidiaries under
Article 659b CO effective on 31 December 2022. At 31 December 2023 such foundations held 519,667 bearer shares
(2022: 19,811 bearer shares) and 11,492,088 non-voting equity securities (2022: 10,053,218 non-voting equity securities) at
cost of CHF 3,756 million (2022: CHF 3,322 million). In accordance with Article 659b of the revised CO the Board of Directors
will propose to the Annual General Meeting to increase the legal reserve for own equity instruments by CHF 434 million to
CHF 3,756 million in the appropriation of available earnings.
Movement in recognised amounts in millions of CHF
Legal retained earnings Voluntary reserves

Reserves for
Statutory own equity
retained instruments
Share earnings held by Special Available Own equity
capital reserves subsidiaries Free reserve reserve earnings instruments Total equity
As at 1 January 2021 160 300 0 6,000 2,152 9,014 0 17,626
Net income – – – – – 18,087 – 18,087
Dividends – – – – – (7,849) – (7,849)
Transactions in own equity instruments – – – – – – 0 0
Share repurchase – – – – – – (18,994) (18,994)
As at 31 December 2021 160 300 0 6,000 2,152 19,252 (18,994) 8,870
Net income – – – – – 11,215 – 11,215

Dividends – – – – – (7,526) – (7,526)
Release of free reserve and special
reserve – – – (6,000) (2,152) 8,152 – 0
Share capital reduction (53) – – – – (18,941) 18,994 0
As at 31 December 2022 107 300 0 0 0 12,152 0 12,559
Net income – – – – – 8,292 – 8,292

Dividends – – – – – (7,688) – (7,688)
Transfer to legal reserve for own equity
instruments – – 3,322 – – (3,322) – 0
As at 31 December 2023 107 300 3,322 0 0 9,434 0 13,163
3. Contingent liabilities
Guarantees
The Company has issued guarantees for certain bonds and notes, commercial paper notes and credit facilities of Group
companies. The nominal amount outstanding at 31 December 2023 was CHF 28.6 billion (2022: CHF 24.9 billion). These are
described in Note 21 to the Roche Group Annual Financial Statements.
4. Significant shareholders
All shares in the Company are bearer shares, and for this reason the Company does not keep a register of shareholders.
The following figures are based on information received from shareholders, the exercise of voting rights at the Annual General
Meeting of 14 March 2023 and on other information available to the Company.
Controlling shareholders
At 31 December 2023, based on the information available to the Company, a shareholder group with pooled voting rights owned
69,318,000 shares representing 64.97% of the issued shares (31 December 2022: 72,018,000 shares representing 67.50%
of the issued shares). On 5 December 2019 the shareholder group announced that it would continue the shareholder pooling
agreement with a modified shareholder composition. This group consists now of Mr André Hoffmann, Ms Marie-Anne Hoffmann,
Ms Vera Michalski, Mr Alexander Hoffmann, Mr Frederic Hoffmann, Ms Isabel Hoffmann, Mr Lucas Hoffmann, Ms Marina
Hoffmann, Ms Kasia Barbotin-Larrieu, Ms Tatiana Fabre, Mr Andreas Oeri, Ms Catherine Oeri, Ms Sabine Duschmalé, Mr Jörg
Duschmalé, Mr Lukas Duschmalé, the charitable Foundation Wolf and Artuma Holding LLC. The shareholder pooling agreement
has existed since 1948. The duration of the pool was extended for an indefinite period in 2009. At 31 December 2023, based
on the information available to the Group, Ms Maja Oeri, formerly a member of the pool, held 8,091,900 shares independently
of the pool, representing 7.58% of the issued shares (31 December 2022: 8,091,900 shares representing 7.58% of the issued
shares).
5. Full-time equivalent employees
The annual average number of full-time equivalent employees for 2023 and 2022 did not exceed ten people.
6. Board and Executive shareholdings
Board of Directors
Directors Mr André Hoffmann and Dr Jörg Duschmalé and certain other members of the founder’s families who are closely
associated with them belong to a shareholder group with pooled voting rights. At the end of 2023 this shareholder group held
69,318,000 shares (2022: 72,018,000 shares). Detailed information about this group is given in Note 4. In addition, at the end
of the year the members of the Board of Directors and persons closely associated with them held shares and non-voting equity
securities (Genussscheine) as shown in the table below.
Shareholdings of members of the Board of Directors
Non-voting equity securities

Shares (Genussscheine) Other
2023 2022 2023 2022
S. Schwan 244,786 215,956 97,876 91,966
A. Hoffmann 0 a) 0 a) 200 200
J. Duschmalé 0 a) 0 a) 0 0
P. Frost 2,000 2,000 0 0
A. Hauser 3,000 3,000 150 150 c)
A. Iwasaki 0 n/a 0 n/a

R. P. Lifton 0 0 0 0 d)
J. Mahmood 0 0 0 0
B. Poussot 500 500 500 500
M. Schneider 2,500 n/a 2,500 n/a
C. Suessmuth Dyckerhoff 0 0 2,710 b) 2,710 b)
Total 252,786 221,456 103,936 95,526
a) Does not include shares held in the shareholder group with pooled voting rights.
b) Jointly held with close relative.
c) Close relatives of A. Hauser held 20 non-voting equity securities (Genussscheine) (2022: 20).
d) Prof. Dr R. P. Lifton held 300 Roche American Depositary Receipts (ADRs) (2022: 300). Eight ADRs are equivalent to one non-voting equity security (Genussschein). ADRs
have been traded in the US over-the-counter market since July 1992.
At 31 December 2023 Dr Severin Schwan held Stock-settled Stock Appreciation Rights (S-SARs) and Restricted Stock Units
(RSUs) awarded in his former role as Chief Executive Officer as shown in the tables below. The terms and vesting conditions
of these awards are disclosed in Note 27 to the Roche Group Annual Financial Statements and additional supplementary
information is given in the Remuneration Report included in the Annual Report on pages 148 to 177. S-SARs and RSUs vest after
four years (S-SAR awards granted before 2019 vested after three years). Thereafter, the non-voting equity securities and/or
shares may remain blocked for up to ten years.
S-SARs awards held at 31 December 2023
Year of issue 2023 2022 2021 2020 2019 2018 2017 Total
S. Schwan (awarded in his former role
as Chief Executive Officer) 115,095 75,635 100,746 103,260 122,322 100,677 85,476 703,211
Strike price (CHF) 263.65 359.70 306.45 308.05 271.65 220.80 251.90
Expiry date Mar. 2033 Mar. 2032 Mar. 2031 Mar. 2030 Mar. 2029 Mar. 2025 Mar. 2024
RSU awards held at 31 December 2023
Year of issue 2023 2022 2021 2020 Total

S. Schwan (awarded in his former role as Chief Executive Officer) 4,046 2,965 3,481 3,463 13,955
Corporate Executive Committee
At the end of the year members of the Corporate Executive Committee and persons closely associated with them held shares
and non-voting equity securities (Genussscheine) as shown in the table below.
Shareholdings of members of the Corporate Executive Committee
Non-voting equity securities

Shares (Genussscheine) Other
2023 2022 2023 2022
T. Schinecker 0 0 3,599 2,752 a)
T. Graham 0 n/a 6,459 n/a a)
A. Hippe 6,970 6,970 43,124 40,390 a), b)
M. Sause 0 n/a 3,516 n/a a)
C. A. Wilbur 0 0 16,010 14,640 a)
Total 6,970 6,970 72,708 57,782
a) Equity compensation awards: S-SARs (Stock-settled Stock Appreciation Rights) and RSUs (Restricted Stock Units).
b) Close relatives of A. Hippe held 21 non-voting equity securities (Genussscheine) (2022: 21).
The remuneration from equity compensation plans to members of the Corporate Executive Committee is composed of 80%
Stock-settled Stock Appreciation Rights (S-SARs) and 20% Restricted Stock Units (RSUs).
At 31 December 2023 members of the Corporate Executive Committee held S-SARs as shown in the table below. The terms and
vesting conditions of these awards are disclosed in Note 27 to the Roche Group Annual Financial Statements and additional
supplementary information is given in the Remuneration Report included in the Annual Report on pages 148 to 177. S-SARs
awards granted to members of the Corporate Executive Committee vest after four years (awards granted before 2019 vested
after three years).
S-SARs awards held at 31 December 2023
Year of issue 2023 2022 2021 2020 2019 2018 2017 Total
T. Schinecker 79,169 20,801 22,669 20,652 3,872 0 0 147,163
T. Graham 27,249 4,412 13,344 14,180 8,960 8,304 3,975 80,424
A. Hippe 42,224 30,255 40,300 41,304 48,930 40,275 2,191 245,479
M. Sause 26,389 4,020 4,256 3,105 0 0 0 40,701
2,931
C. A. Wilbur 26,390 18,910 25,187 25,815 29,052 21,402 16,032 162,788
Total 201,421 78,398 105,756 107,987 90,814 69,981 22,198 676,555
Strike price (CHF) 261.30 359.70 306.45 308.05 271.65 220.80 251.90
335.45
Expiry date Mar. 2033 Mar. 2032 Mar. 2031 Mar. 2030 Mar. 2029 Mar. 2025 Mar. 2024
Apr. 2030
At 31 December 2023 members of the Corporate Executive Committee held RSUs as shown in the table below. The terms and
vesting conditions of these awards are disclosed in Note 27 to the Roche Group Annual Financial Statements and additional
supplementary information is given in the Remuneration Report included in the Annual Report on pages 148 to 177. RSU awards
granted to members of the Corporate Executive Committee vest after four years. Thereafter, the non-voting equity securities
and/or shares may remain blocked for up to ten years.
RSU awards held at 31 December 2023
Year of issue 2023 2022 2021 2020 Total

T. Schinecker 3,062 815 783 693 5,353
T. Graham 1,054 2,076 922 475 4,527
A. Hippe 1,633 1,186 1,392 1,385 5,596
M. Sause 1,021 1,890 1,176 1,076 5,163
C. A. Wilbur 1,021 741 870 866 3,498
Total 7,791 6,708 5,143 4,495 24,137
Information relating to the number and value of rights, options and awards granted to employees of the Roche Group and members
of the Board of Directors and the Corporate Executive Committee of the Company are disclosed in Note 27 and Note 32 to the
Roche Group Annual Financial Statements.
194    Roche Holding Ltd, Basel | Appropriation of Available Earnings Finance Report 2023
Appropriation of Available Earnings
Proposals to the Annual General Meeting in CHF
2023 2022
Available earnings
Balance brought forward from previous year 1,142,153,324 937,167,310
Net profit for the year 8,292,031,020 11,215,484,626
Transfer to legal reserve for own equity instruments held by subsidiaries a) (433,802,156) (3,322,588,462)
Total available earnings 9,000,382,188 8,830,063,474
Appropriation of available earnings

Distribution of an ordinary dividend of CHF 9.60 gross per share entitled to dividend and non-voting
equity security (Genussschein) as against CHF 9.50 last year (7,768,835,520) (7,687,910,150)
Total appropriation of available earnings (7,768,835,520) (7,687,910,150)
To be carried forward on this account 1,231,546,668 1,142,153,324
a) Article 659b of the Swiss Code of Obligations (CO) requires the creation of an additional legal reserve for own equity instruments held by subsidiaries over which the
Company as parent company of the Roche Group has control, including foundations as included in the IFRS consolidation scope.
Finance Report 2023 Statutory Auditor’s Report | Roche Holding Ltd, Basel    195
Statutory Auditor’s Report

To the General Meeting of Roche Holding Ltd, Basel
Report on the Audit of the Financial Statements
Opinion
We have audited the financial statements of Roche Holding Ltd (the Company), which comprise the balance sheet as at
31 December 2023, and the income statement for the year then ended, and notes to the financial statements, including a
summary of significant accounting policies.
In our opinion, the financial statements (pages 184–194) comply with Swiss law and the Company’s articles of incorporation.
Basis for Opinion
We conducted our audit in accordance with Swiss law and Swiss Standards on Auditing (SA-CH). Our responsibilities under
those provisions and standards are further described in the ’Auditor’s Responsibilities for the Audit of the Financial Statements’
section of our report. We are independent of the Company in accordance with the provisions of Swiss law, together with
the requirements of the Swiss audit profession and we have fulfilled our other ethical responsibilities in accordance with these
requirements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
statements of the current period. We have determined that there are no key audit matters to communicate in our report.
Other Information
The Board of Directors is responsible for the other information. The other information comprises the information included in
the finance report and the annual report, but does not include the consolidated financial statements, the stand-alone financial
statements of the Company, the remuneration report and our auditor’s reports thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance
conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the
audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
196    Roche Holding Ltd, Basel | Statutory Auditor’s Report Finance Report 2023
Board of Directors’ Responsibilities for the Financial Statements
The Board of Directors is responsible for the preparation of the financial statements in accordance with the provisions of Swiss
law and the Company’s articles of incorporation, and for such internal control as the Board of Directors determines is necessary
to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the Board of Directors is responsible for assessing the Company’s ability to continue as
a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting
unless the Board of Directors either intends to liquidate the Company or to cease operations, or has no realistic alternative but
to do so.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Swiss law and SA-CH will always
detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if,
individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these financial statements.
As part of an audit in accordance with Swiss law and SA-CH, we exercise professional judgement and maintain professional
scepticism throughout the audit. We also:
— Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design
and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to
provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one
resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of
internal control.
— Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in
the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.
— Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related
disclosures made.
— Conclude on the appropriateness of the Board of Directors’ use of the going concern basis of accounting and, based on
the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant
doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are
required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures
are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our
auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.
We communicate with the Board of Directors or its relevant committee regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during
our audit.
We also provide the Board of Directors or its relevant committee with a statement that we have complied with relevant ethical
requirements regarding independence, and communicate with them all relationships and other matters that may reasonably be
thought to bear on our independence, and where applicable, actions taken to eliminate threats or safeguards applied.
From the matters communicated with the Board of Directors or its relevant committee, we determine those matters that were
of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We
describe these matters in our auditor’s report, unless law or regulation precludes public disclosure about the matter or when,
in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse
consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Finance Report 2023 Statutory Auditor’s Report | Roche Holding Ltd, Basel    197
Report on Other Legal and Regulatory Requirements

In accordance with article 728a para. 1 item 3 CO and PS-CH 890, we confirm that an internal control system exists, which has
been designed for the preparation of financial statements according to the instructions of the Board of Directors.
We further confirm that the proposed appropriation of available earnings complies with Swiss law and the Company’s articles
of incorporation. We recommend that the financial statements submitted to you be approved.
KPMG AG
François Rouiller Paul Nichols

Licensed Audit Expert
Auditor in Charge
KPMG AG, Grosspeteranlage 5, CH-4002 Basel
© 2024 KPMG AG, a Swiss corporation, is a subsidiary of KPMG Holding AG, which is a member of the KPMG global organization of independent member firms affiliated with
KPMG International Limited, a private English company limited by guarantee. All rights reserved.
Published by Cautionary statement regarding forward-looking statements
F. Hoffmann-La Roche Ltd This Finance Report contains certain forward-looking statements.
Group Communications These forward-looking statements may be identified by words
4070 Basel, Switzerland such as ‘believes’, ‘expects’, ‘anticipates’, ‘projects’, ‘intends’,
Tel.: +41 (0)61 688 11 11 ‘should’, ‘seeks’, ‘estimates’, ‘future’ or similar expressions or
www.roche.com by discussion of, among other things, strategy, goals, plans or
intentions. Various factors may cause actual results to differ
To order/download publications materially in the future from those reflected in forward-looking
Internet: roche.com/publications statements contained in this Finance Report, among others:
E-mail: materials.management.mm1@roche.com (1) pricing and product initiatives of competitors; (2) legislative
Fax: +41 (0)61 688 69 02 and regulatory developments and economic conditions;
(3) delay or inability in obtaining regulatory approvals or bringing
Media Relations products to market; (4) fluctuations in currency exchange rates
Tel.: +41 (0)61 688 88 88 and general financial market conditions; (5) uncertainties in the
E-mail: media.relations@roche.com discovery, development or marketing of new products or new uses
of existing products, including without limitation negative results
Investor Relations of clinical trials or research projects, unexpected side effects of
Tel.: +41 (0)61 688 88 80 pipeline or marketed products; (6) increased government pricing
E-mail: investor.relations@roche.com pressures; (7) interruptions in production; (8) loss of or inability to
obtain adequate protection for intellectual property rights;
Group Sustainability (9) litigation; (10) loss of key executives or other employees; and
E-mail: corporate.sustainability@roche.com (11) adverse publicity and news coverage.
Next Annual General Meeting: The statement regarding earnings per share growth is not a profit
12 March 2024 forecast and should not be interpreted to mean that Roche’s
earnings or earnings per share for 2024 or any subsequent period
will necessarily match or exceed the historical published earnings
or earnings per share of Roche.
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Finance Report 2023

Sales Core operating profit margin

Pharmaceuticals 2023 +5.9 44.8

Diagnostics 2023 -13.1 18.9

Group 2023 +0.6 32.8

2023 2022 % change % change % of sales % of sales

Free cash flow

2023 2022 % change % change

Capitalisation 62,472 57,366 +9 +19

a) Proposed by the Board of Directors.

Finance – 2023 in Brief

Finance – 2023 in Brief 1

Report of Roche Management on Internal Control over Financial Reporting 162

Roche Holding Ltd, Basel

Roche Group results

Sales in billions of CHF Core operating profit in billions of CHF

% CER growth % of sales

Divisional operating results for 2023

Divisional operating results – Development of results compared to 2022

Pharmaceuticals Diagnostics Corporate Group

Financing costs (996) (665) +50 +59

Income taxes (1,721) (2,796) –38 –27

EPS – Basic (CHF) 14.40 15.52 –7 +11

Financing costs (980) (686) +43 +52

Income taxes (2,136) (3,429) –38 –28

Core EPS – Basic (CHF) 18.69 20.49 –9 +6

Competition from biosimilar and generic medicines

Total MabThera/Rituxan, Herceptin and Avastin sales

Mergers and acquisitions

Further details are given in Note 6 to the Annual Financial Statements.

Global restructuring plans

Global restructuring plans: costs incurred in millions of CHF

Impairment of goodwill and intangible assets

Diagnostics Division. There were no significant impairments of goodwill or intangible assets.

Legal and environmental cases

Net income and earnings per share

Reconciling items (net of tax)

Net debt (18,699) (15,584) +20 +26

Free cash flow

Free cash flow

Pharmaceuticals Division operating results

Pharmaceuticals Division operating results

Free cash flow b)

a) See pages 172–176 for the definition of core results.

Pharmaceuticals Division – Sales by therapeutic area

Pharmaceuticals Division – Sales

Pharmaceuticals Division – Sales (continued)

Total sales 44,612 45,551 +6 100 100

Ocrevus regional sales

Hemlibra. For haemophilia A.

Hemlibra regional sales

Perjeta regional sales

Kadcyla regional sales

Herceptin regional sales

Phesgo regional sales

Tecentriq regional sales

Vabysmo regional sales

Actemra/RoActemra regional sales

Xolair. For chronic spontaneous urticaria and allergic asthma.