Bausch Health Cos (NYSE:BHC) opened 2026 with what executives described as a “strong performance,” driven primarily by Salix and Solta Medical, while reaffirming full-year guidance for the company excluding Bausch + Lomb. Management also discussed ongoing capital structure priorities, product launches across regions, and updates on the company’s R&D portfolio—particularly the larsucosterol Phase III program acquired through DURECT.
Quarterly performance and cash flow
Chief Executive Officer Thomas Appio said the company “extend[ed] our track record to 12 consecutive quarters of year-over-year growth in both revenue and adjusted EBITDA for Bausch Health, excluding Bausch + Lomb,” citing “strategic execution and disciplined accountability across our global organization.” Appio added that first-quarter cash flow was “supported by solid operating performance,” which he said helps advance deleveraging while preserving “capital allocation flexibility.”
For Bausch Health excluding Bausch + Lomb, Charhon reported:
- Revenue of $1.28 billion, up 14% reported and 9% organically year-over-year
- Adjusted EBITDA of $673 million, up 17% year-over-year
- Adjusted operating cash flow of $319 million, “nearly $200 million higher” than the prior-year quarter, driven by stronger performance and interest payment timing
Charhon also noted that adjusted operating expenses excluded “the $1.4 billion goodwill impairment charge following the RED-C clinical trial outcome.”
Segment results led by Salix and Solta
In Salix, Charhon said revenue rose to $639 million, up 18% year-over-year, “largely driven by higher-than-expected Xifaxan revenue,” which grew 21%. He attributed the Xifaxan gain primarily to “continued volume growth in the channel we currently serve,” net pricing, and “to a lesser extent” residual Medicaid volume at the state level. He added that “old scripts in the commercial and Medicare channels grew 6% and new-to-brand script growth was 3%.”
Appio said Salix also benefited from “improved margin dynamics following payer channel optimization,” and that while the company benefited from “residual volume in certain channels that we exited starting last quarter,” underlying prescription trends “remain healthy.”
Solta Medical posted revenue of $171 million, up 51% on a reported basis and 19% organically year-over-year. Charhon said the segment’s performance was driven by China, where revenue grew 193% year-over-year. He attributed part of the China growth to “higher pricing associated with the integration of our full-service distributor, Shibo, we acquired in December 2025,” and also cited 52% volume growth during the quarter. Charhon said China has “reclaimed the number one position as the largest geography of Solta,” while South Korea, the second-largest contributor, grew 17%.
Appio told analysts that the Shibo integration is “going extremely well” and said demand remains high, with Thermage viewed as “the gold standard” in China. He also described the customer base as “a little bit insulated…from the economics that are going on…globally,” adding that the business benefits from both capital equipment and consumables.
International segment revenue was $285 million, up 9% reported and “broadly flat” organically, with mixed regional performance. Charhon said EMEA was up 3% organically and achieved its “13th consecutive quarter of organic revenue growth,” LatAm was flat with growth in core products like Bedoyecta but continued tender-related order softness, and Canada contracted 7% due to its non-promoted portfolio. He noted that Canada’s promoted portfolio grew 18% but was offset by a decline in branded generics after prior-period Wellbutrin volumes benefited from supply shortages.
Diversified segment revenue fell 10% year-over-year to $185 million, which Charhon said was “largely driven by our neuroscience business,” where lower volume was partially offset by favorable pricing.
On Bausch + Lomb, the company briefly referenced results previously announced, noting revenue of $1.244 billion, up 9% reported and 6% organically.
Guidance reaffirmed; tariffs and channel dynamics discussed
Charhon reaffirmed full-year 2026 guidance for Bausch Health excluding Bausch + Lomb, calling for:
- Revenue of $5.25 billion to $5.4 billion
- Adjusted EBITDA of $2.875 billion to $2.95 billion
- Adjusted operating cash flow of $1.2 billion to $1.275 billion
He said the adjusted EBITDA guidance “now includes the anticipated impact of the new tariffs on pharma products expected to be effective on September 29, 2026,” and added that guidance is at current FX rates.
On tariffs, Appio said the company’s “local production in many of the markets…naturally helps,” and that tariffs would “probably…have an impact on Xifaxan and TRULANCE” beginning late September 2026. Charhon characterized the impact as “minimal” in 2026 and said the prior view of minimal P&L impact “remains the same even with the latest round of tariffs,” while noting that 2027 will depend on mitigations if tariffs persist.
Appio also cautioned that “dynamics relating to our exit from Medicaid and 340B may impact our growth…in the back half of the year,” particularly in Salix and diversified segments.
Xifaxan outlook, IRA-related questions, and exclusivity timing
Asked about potential wholesaler stocking behavior ahead of IRA-driven pricing changes, Charhon said the company is “expecting a gross to net accrual adjustment” tied to a “higher discount rate…effective January 1, 2027,” but “in terms of volume, we’re not anticipating any change versus the current volume we’re seeing right now.”
On litigation and exclusivity risk, Appio said the company continues to plan for a generic entrant on “1/1/2028,” noting Teva’s first-filer status and that Teva has received “final approval…by the FDA.” He added that two appeal cases are “fully briefed” and the company is “waiting on a decision,” while stating, “we remain confident in our IP, and planning for 1/1/2028.”
Charhon said an earlier loss of exclusivity would reduce free cash flow generation through 2027 and, absent other levers, could require monetizing assets earlier than planned. He cited potential refinancing to push out maturities as one option, as well as “capital reallocation within our portfolio.” On the possibility of issuing equity, Charhon said it is “not…high on our priority list at this stage, given where the share price is,” adding, “It’s a possibility, it’s probably not a probability at this stage.”
R&D updates: larsucosterol Phase III design and portfolio prioritization
Chief Medical Officer and Head of R&D Jonathan Sadeh provided detail on changes to the larsucosterol Phase III program in alcohol-associated hepatitis. He said the prior Phase II-B outcomes were influenced by differences between U.S. and ex-U.S. patients, including longer times to randomization outside the U.S. and a potentially different patient profile. Sadeh said the company observed “over 50% reduction in mortality” in the U.S. patient population and described that effect as “highly statistically significant” within that subgroup.
To address earlier issues, Sadeh said Phase III will be U.S.-only to create a more homogeneous population, and patients must be randomized within nine days of presentation. He also said the study is “power[ed]…highly to 90% alpha” with a large number of patients. “The study is now in…start mode,” he said, adding the company is “opening up sites” and is “very optimistic” about the probability of success.
On amiselimod, Sadeh said the company has been reviewing ulcerative colitis data for some time and described the data as “very good.” He said the company is conducting a broader portfolio-wide prioritization across drugs and potential indications, weighing factors such as “scientific evidence, developability…regulatory path, and importantly, commercial opportunity,” and determining “which ones we will progress with.”
Management reiterated its stated financial priorities, including deleveraging, evaluating options to “unlock value” across Bausch Health and Bausch + Lomb assets, and maintaining flexibility in capital allocation. Charhon said net debt excluding Bausch + Lomb fell by about $150 million in the quarter, despite roughly $160 million in outflows for legacy litigation, including the final U.S. opt-out settlement payments.
About Bausch Health Cos (NYSE:BHC)
Bausch Health Cos Inc, formerly known as Valeant Pharmaceuticals International, is a global specialty pharmaceutical company headquartered in Laval, Quebec, Canada. The company operates through two primary segments: Ophthalmology, led by its Bausch + Lomb franchise, and Diversified Brands, which encompasses prescription dermatology, gastrointestinal, neurology and branded pharmaceutical products. Bausch Health develops, manufactures and markets a range of therapeutic and over-the-counter offerings designed to address conditions such as cataracts, dry eye, glaucoma, acne, rosacea, migraine and gastrointestinal disorders.
The Ophthalmology segment under the Bausch + Lomb name provides products for eye health, including prescription drops, contact lens care solutions, intraocular lenses, surgical instruments and diagnostic devices.
