Qiagen

2 0 1 9

Q I A G E N   N . V .   F I N A N C I A L   R E P O R T

Sample to Insight

As the innovative market and technology leader, 
QIAGEN creates Sample to Insight solutions that 
enable access to valuable molecular insights  
from any biological sample.

Our mission is to make improvements in life possible  
by enabling our customers to achieve outstanding 
 success and breakthroughs in life sciences, applied 
testing, pharma and molecular diagnostics.

Our commitment to customers, patients, investors  
and other stakeholders drives our innovation and 
leadership in all areas where our Sample to  
Insight techno logies are required. The exceptional  
talent, skill and passion of our employees are  
key to QIAGEN’s excellence, success and value.

Content

Overview

Financial Results

008 Report of the Supervisory Board

134 Consolidated Financial Statements

012 The Executive Committee

016 Common Shares 

142 Notes to Consolidated Financial Statements

206 Auditor’s Report

212 List of Subsidiaries 

Management Report

Appendix

024 Business and Operating Environment

213 Service

054 Opportunities and Risks

076 Performance Review

088 Human Resources

092 Non-Financial Statement

108 Future Perspectives 

Corporate Governance 

and Compensation

112 Corporate Structure

112 Managing Board

114 Supervisory Board

124 Share Ownership

125 Additional Information

This document contains detailed financial information about 
QIAGEN prepared under U.S. generally accepted accounting 
standards (U.S. GAAP) and included in our Form 20-F annual 
report filed with the U.S. Securities and Exchange Commission. 
QIAGEN also publishes an Annual Report under IFRS accounting 
standards, which is  available on our website at www.QIAGEN.com.

Overview

008 Report of the Supervisory Board

012 The Executive Committee

016 Common Shares

Overview
Overview

Overview
Common Shares
Report of the Supervisory Board

QIAGEN’s common share price fluctuated widely in U.S. and European markets in 2019 but ended the year close to
QIAGENers – the name we use proudly for our more than 5,100 employees worldwide – are the reason for our
QIAGENers – the name we use proudly for our more than 5,100 employees 
starting price levels. The performance was influenced by challenges facing sales growth, successful initiatives to
success. The members of the Supervisory Board wish to thank all QIAGENers for their contributions during 2019
Report of the Supervisory Board
worldwide – are the reason for our success. The members of the Supervisory 
improve profitability and a review of strategic options for QIAGEN. We thank shareholders for their support.
toward achieving our vision of making improvements in life possible. We would also like to thank our shareholders,
Board wish to thank all QIAGENers for their contributions during 2019 toward 
QIAGEN’s senior executives and Investor Relations team have been recognized for proactive, transparent
customers, business partners and other stakeholders for honoring QIAGEN with their continued collaboration and
communications with the financial community.
trust.
QIAGENers – the name we use proudly for our more than 5,100 employees worldwide – are the reason for our
achieving our vision of making improvements in life possible. We would also 
success. The members of the Supervisory Board wish to thank all QIAGENers for their contributions during 2019
like to thank our shareholders, customers, business partners and other stake-
toward achieving our vision of making improvements in life possible. We would also like to thank our shareholders,
Market Environment
Agreement for Thermo Fisher Scientific Inc. to Acquire QIAGEN
customers, business partners and other stakeholders for honoring QIAGEN with their continued collaboration and
holders for honoring QIAGEN with their continued collaboration and trust.
trust.
Stock markets globally moved up in 2019 after a weak year in 2018. During 2019, investors responded to
As an important subsequent event to 2019, QIAGEN and Thermo Fisher Scientific Inc. (NYSE: TMO) announced on
accommodative monetary policy including interest rate cuts by the U.S. Federal Reserve and European Central Bank,
March 3, 2020, that their boards of directors, as well as the Managing Board of QIAGEN N.V., have unanimously
as well as some additional clarity in trade relationships. Slower economic growth and geopolitical strains in 2019
approved Thermo Fisher’s proposal to acquire QIAGEN for €39 per share in cash. The offer price represents a
Agreement for Thermo Fisher Scientific Inc. to Acquire QIAGEN
caused uncertainties for investors but did not prevent brisk advances in stock prices in markets around the world.
premium of approximately 23% to the closing price of QIAGEN’s common stock on the Frankfurt Prime Standard on
March 2, 2020, the last trading day prior to the announcement of the transaction. Thermo Fisher will commence a
As an important subsequent event to 2019, QIAGEN and Thermo Fisher Scientific Inc. (NYSE: TMO) announced on
tender offer to acquire all of the ordinary shares of QIAGEN. At the time of the announcement, the transaction
March 3, 2020, that their boards of directors, as well as the Managing Board of QIAGEN N.V., have unanimously
Market benchmarks for the year were very strong. The S&P 500 index in the United States finished up 28.9% in
valued QIAGEN at approximately $11.5 billion, which includes the assumption of approximately $1.4 billion of net
approved Thermo Fisher’s proposal to acquire QIAGEN for €39 per share in cash. The offer price represents a
2019, while the NASDAQ Biotechnology Index in the U.S. finished up 26.8%. The DAX index of the 30 largest
debt. The transaction, which is expected to be completed in the first half of 2021, is subject to the satisfaction of
premium of approximately 23% to the closing price of QIAGEN’s common stock on the Frankfurt Prime Standard on
companies in Germany rose 25.5% during the year, and Germany’s TecDAX, of which QIAGEN is a member,
customary closing conditions, including the receipt of applicable regulatory approvals, the adoption of certain
March 2, 2020, the last trading day prior to the announcement of the transaction. Thermo Fisher will commence a
improved by 23.0% for the year.
tender offer to acquire all of the ordinary shares of QIAGEN. At the time of the announcement, the transaction
resolutions relating to the transaction at an Extraordinary General Meeting of QIAGEN’s shareholders, and
valued QIAGEN at approximately $11.5 billion, which includes the assumption of approximately $1.4 billion of net
completion of the tender offer. Thermo Fisher has obtained committed bridge financing. Permanent funding is
The molecular diagnostics and life science tools segment grew at a healthy pace in 2019. Expanding use of new
debt. The transaction, which is expected to be completed in the first half of 2021, is subject to the satisfaction of
expected to come from cash on hand and the issuance of new debt. The transaction is not subject to any financing
technologies such as next-generation sequencing (NGS), liquid biopsies and gene editing helped drive demand for
customary closing conditions, including the receipt of applicable regulatory approvals, the adoption of certain
condition.
molecular testing instruments and consumables in research. Funding for academic and pharmaceutical research grew
resolutions relating to the transaction at an Extraordinary General Meeting of QIAGEN’s shareholders, and
at mid-single digit rates. In healthcare, molecular testing continued to disseminate for precision medicine in oncology,
completion of the tender offer. Thermo Fisher has obtained committed bridge financing. Permanent funding is
The members of the Supervisory Board unanimously support this agreement, which will enable QIAGEN to enter a
diagnosis of infectious diseases and identification of rare diseases, despite uncertainties in reimbursement and
expected to come from cash on hand and the issuance of new debt. The transaction is not subject to any financing
promising new era and will give our employees the opportunity to have an even greater impact. The combination is
government policies. In 2019 QIAGEN delivered 4% growth in net sales at constant exchange rates (CER) and 9%
condition.
designed to deliver significant cash value to our shareholders, while enabling QIAGEN to accelerate the expansion
growth in adjusted earnings per share CER. QIAGEN sales grew among its Molecular Diagnostics and Life Sciences
of its solutions to provide customers worldwide with breakthroughs that advance our knowledge about the science of
(Pharma and Academia/Applied Testing) customers, led by the Americas and Europe/Middle East/Africa regions.
The members of the Supervisory Board unanimously support this agreement, which will enable QIAGEN to enter a
life and improve health outcomes.
Growth drivers included the QuantiFERON-TB tests, universal NGS technologies, QIAsymphony and QIAstat-Dx
promising new era and will give our employees the opportunity to have an even greater impact. The combination is
automation systems, and the Precision Medicine portfolio. QIAGEN intensified its focus in 2019 to allocate resources
designed to deliver significant cash value to our shareholders, while enabling QIAGEN to accelerate the expansion
to the highest-potential growth drivers in its Sample to Insight portfolio while improving profitability, enhancing
2019: A Challenging Year in Terms of Performance
of its solutions to provide customers worldwide with breakthroughs that advance our knowledge about the science of
shareholder value and maintaining flexibility.
life and improve health outcomes.
A key role of the Supervisory Board is to monitor the performance and progress of QIAGEN’s business on a regular
basis, and this was done during the course of 2019 with detailed written and oral reports from the Managing
Global shares listed in the U.S. and Europe
2019: A Challenging Year in Terms of Performance
Directors, members of the Executive Committee and other senior leaders.
QIAGEN’s global shares have been registered and traded in the United States since 1996, trading on the New York
A key role of the Supervisory Board is to monitor the performance and progress of QIAGEN’s business on a regular
Stock Exchange since January 10, 2018, after listing for more than 20 years on NASDAQ markets. The global
QIAGEN had a challenging year in 2019. During the second half, QIAGEN had to update its outlook to the capital
basis, and this was done during the course of 2019 with detailed written and oral reports from the Managing
shares also have traded in Germany on the Frankfurt Stock Exchange since 1997, and the Prime Standard segment
markets to take into account a decision to stop a joint venture for the GeneReader NGS System in China and
Directors, members of the Executive Committee and other senior leaders.
since its launch in 2003. The dual listing of global shares on NYSE and the Frankfurt exchange offers advantages for
expectations for a continued reduction in revenues from companion diagnostic co-development projects as a result of
QIAGEN, our shareholders and employees, increasing the potential market opportunity to attract investors,
the decision to gain access to the clinical next-generation sequencers of Illumina, Inc. through a new partnership. In
QIAGEN had a challenging year in 2019. During the second half, QIAGEN had to update its outlook to the capital
particularly those in the U.S. that can only invest in U.S. dollar-denominated investments, and enhances liquidity.
the end, QIAGEN achieved the revised targets for net sales growth and improvements in adjusted earnings per share
markets to take into account a decision to stop a joint venture for the GeneReader NGS System in China and
Unlike American Depositary Receipts (ADRs), QIAGEN’s global shares provide equal rights for all shareholders and
(EPS), which excludes purchased intangibles amortization, long-lived asset impairments and other items such as
expectations for a continued reduction in revenues from companion diagnostic co-development projects as a result of
can be traded on either exchange, in U.S. dollars or euros.
business integration, acquisition-related costs, litigation costs and restructuring. Our teams completed projects during
the decision to gain access to the clinical next-generation sequencers of Illumina, Inc. through a new partnership. In
the year to reallocate resources to support business expansion while also improving profitability.
the end, QIAGEN achieved the revised targets for net sales growth and improvements in adjusted earnings per share
Share Price and Liquidity
(EPS), which excludes purchased intangibles amortization, long-lived asset impairments and other items such as
CEO Leadership Transition
business integration, acquisition-related costs, litigation costs and restructuring. Our teams completed projects during
the year to reallocate resources to support business expansion while also improving profitability.

CEO Leadership Transition

8

Overview

Report of the Supervisory Board

QIAGENers – the name we use proudly for our more than 5,100 employees worldwide – are the reason for our

success. The members of the Supervisory Board wish to thank all QIAGENers for their contributions during 2019

toward achieving our vision of making improvements in life possible. We would also like to thank our shareholders,

customers, business partners and other stakeholders for honoring QIAGEN with their continued collaboration and

trust.

Agreement for Thermo Fisher Scientific Inc. to Acquire QIAGEN

As an important subsequent event to 2019, QIAGEN and Thermo Fisher Scientific Inc. (NYSE: TMO) announced on

March 3, 2020, that their boards of directors, as well as the Managing Board of QIAGEN N.V., have unanimously

approved Thermo Fisher’s proposal to acquire QIAGEN for €39 per share in cash. The offer price represents a

premium of approximately 23% to the closing price of QIAGEN’s common stock on the Frankfurt Prime Standard on

March 2, 2020, the last trading day prior to the announcement of the transaction. Thermo Fisher will commence a

tender offer to acquire all of the ordinary shares of QIAGEN. At the time of the announcement, the transaction

valued QIAGEN at approximately $11.5 billion, which includes the assumption of approximately $1.4 billion of net

debt. The transaction, which is expected to be completed in the first half of 2021, is subject to the satisfaction of

customary closing conditions, including the receipt of applicable regulatory approvals, the adoption of certain

resolutions relating to the transaction at an Extraordinary General Meeting of QIAGEN’s shareholders, and

completion of the tender offer. Thermo Fisher has obtained committed bridge financing. Permanent funding is

expected to come from cash on hand and the issuance of new debt. The transaction is not subject to any financing

condition.

The members of the Supervisory Board unanimously support this agreement, which will enable QIAGEN to enter a

promising new era and will give our employees the opportunity to have an even greater impact. The combination is

designed to deliver significant cash value to our shareholders, while enabling QIAGEN to accelerate the expansion

of its solutions to provide customers worldwide with breakthroughs that advance our knowledge about the science of

life and improve health outcomes.

2019: A Challenging Year in Terms of Performance

A key role of the Supervisory Board is to monitor the performance and progress of QIAGEN’s business on a regular

basis, and this was done during the course of 2019 with detailed written and oral reports from the Managing

Directors, members of the Executive Committee and other senior leaders.

QIAGEN had a challenging year in 2019. During the second half, QIAGEN had to update its outlook to the capital

markets to take into account a decision to stop a joint venture for the GeneReader NGS System in China and

expectations for a continued reduction in revenues from companion diagnostic co-development projects as a result of
the decision to gain access to the clinical next-generation sequencers of Illumina, Inc. through a new partnership. In
O V E R V I E W Report of the Supervisory Board
the end, QIAGEN achieved the revised targets for net sales growth and improvements in adjusted earnings per share
(EPS), which excludes purchased intangibles amortization, long-lived asset impairments and other items such as
business integration, acquisition-related costs, litigation costs and restructuring. Our teams completed projects during
the year to reallocate resources to support business expansion while also improving profitability.

CEO Leadership Transition

QIAGEN announced in October 2019 that Peer M. Schatz had notified the Supervisory Board that, after 27 years
with the Company, he had decided to step down as Chief Executive Officer and Chairman of the Managing Board,
and would remain with QIAGEN as a Special Advisor to the Supervisory Board. Thierry Bernard, Senior Vice
President, Head of Molecular Diagnostics Business Area, was appointed in October 2019 as Interim CEO and
worked in tandem with Roland Sackers, Chief Financial Officer and Member of the Managing Board. Mr. Bernard
was named CEO in March 2020, and will be proposed for election as a Managing Director, along with Mr.
Sackers, at the next Annual General Meeting scheduled for June 2020.

The members of the Supervisory Board would like to thank Mr. Schatz for his exceptional contributions and
dedication to QIAGEN. We all owe him tremendous gratitude for his outstanding leadership and track record that
contributed to the creation of a true success story in the life sciences industry and enabled such great advances in
science and healthcare. We respect his decision to pursue other interests.

Composition of the Supervisory Board

The composition of the Supervisory Board did not change during 2019.

All current members of the Supervisory Board will stand for re-election at the upcoming Annual General Meeting in
June 2020. Additionally, all members, with the exception of Metin Colpan and Elizabeth E. Tallett, have served in
the Supervisory Board for less than eight years as recommended by the Dutch Corporate Governance Code.
QIAGEN values the profound industry experience of Dr. Colpan and Ms. Tallett for their in-depth knowledge, and
supports their reappointments.

The target profile of the Supervisory Board can be found on QIAGEN’s website, as well as in the Governance
section of this Annual Report. The current composition fully complies with this profile. Further information on the
individual members of the Supervisory Board, such as gender, age, nationality and other positions relevant to the
performance of their duties as Supervisor Board member, date of initial appointment and current term of office is set
forth in the Corporate Governance Report and on our website at www.QIAGEN.com.

QIAGEN has a commitment to developing a diverse leadership team, with a broad range of backgrounds,
experience, skills and capabilities. In nominating candidates, QIAGEN is committed to increasing diversity while
pursuing individuals to join QIAGEN with a unique blend of scientific and commercial expertise and experience that
will contribute to our future business success. Management development programs support the career advancement
of leaders regardless of gender and other factors. As a result, a number of women are in key leadership roles
around the world, and QIAGEN currently has 29% of management roles held by women. In line with this
commitment, the Supervisory Board continues to take diversity into account when proposing members for election or
re-election without compromising QIAGEN’s commitment to hiring the best individuals for positions without any
discrimination. The current governance structure has led to the size of the Managing Board of two members, so
achieving a diversity goal as measured solely by a percentage of overall membership is difficult to achieve. At the
same time, QIAGEN has significantly increased the diversity of its senior leadership team and will continue to do so
in the future.

Principal Topics Discussed by the Supervisory Board

As empowered by the Dutch Corporate Governance Code, the Supervisory Board devoted considerable time during
2019 to discussing and assessing QIAGEN’s corporate strategy, main risks and opportunities, and an annual
assessment by the Managing Board of the design and effectiveness of internal risk management and control systems
as well as any significant changes in them. In addition, the Supervisory Board discussed and reviewed the
functioning of its committees and individual members, its current composition, competence, succession schedule and
desired profile in various meetings and through written surveys.

The Supervisory Board met seven times during 2019, and conducted 15 telephone conference calls. These meetings
also included regular attendance of the members of the Managing Board for certain agenda items. The Supervisory
Board also met to review and discuss agenda items in the absence of the Managing Board members, such as
performance and strategy as well as to discuss compensation matters. Information about the Supervisory Board

9

QIAGEN announced in October 2019 that Peer M. Schatz had notified the Supervisory Board that, after 27 years

with the Company, he had decided to step down as Chief Executive Officer and Chairman of the Managing Board,

and would remain with QIAGEN as a Special Advisor to the Supervisory Board. Thierry Bernard, Senior Vice

President, Head of Molecular Diagnostics Business Area, was appointed in October 2019 as Interim CEO and

worked in tandem with Roland Sackers, Chief Financial Officer and Member of the Managing Board. Mr. Bernard

was named CEO in March 2020, and will be proposed for election as a Managing Director, along with Mr.

Sackers, at the next Annual General Meeting scheduled for June 2020.

The members of the Supervisory Board would like to thank Mr. Schatz for his exceptional contributions and

dedication to QIAGEN. We all owe him tremendous gratitude for his outstanding leadership and track record that

contributed to the creation of a true success story in the life sciences industry and enabled such great advances in

science and healthcare. We respect his decision to pursue other interests.

Composition of the Supervisory Board

The composition of the Supervisory Board did not change during 2019.

All current members of the Supervisory Board will stand for re-election at the upcoming Annual General Meeting in

June 2020. Additionally, all members, with the exception of Metin Colpan and Elizabeth E. Tallett, have served in

the Supervisory Board for less than eight years as recommended by the Dutch Corporate Governance Code.

QIAGEN values the profound industry experience of Dr. Colpan and Ms. Tallett for their in-depth knowledge, and

supports their reappointments.

The target profile of the Supervisory Board can be found on QIAGEN’s website, as well as in the Governance

section of this Annual Report. The current composition fully complies with this profile. Further information on the

individual members of the Supervisory Board, such as gender, age, nationality and other positions relevant to the

performance of their duties as Supervisor Board member, date of initial appointment and current term of office is set

forth in the Corporate Governance Report and on our website at www.QIAGEN.com.

QIAGEN has a commitment to developing a diverse leadership team, with a broad range of backgrounds,

experience, skills and capabilities. In nominating candidates, QIAGEN is committed to increasing diversity while

pursuing individuals to join QIAGEN with a unique blend of scientific and commercial expertise and experience that

will contribute to our future business success. Management development programs support the career advancement

of leaders regardless of gender and other factors. As a result, a number of women are in key leadership roles
around the world, and QIAGEN currently has 29% of management roles held by women. In line with this
commitment, the Supervisory Board continues to take diversity into account when proposing members for election or
re-election without compromising QIAGEN’s commitment to hiring the best individuals for positions without any
discrimination. The current governance structure has led to the size of the Managing Board of two members, so
achieving a diversity goal as measured solely by a percentage of overall membership is difficult to achieve. At the
same time, QIAGEN has significantly increased the diversity of its senior leadership team and will continue to do so
in the future.

Principal Topics Discussed by the Supervisory Board

As empowered by the Dutch Corporate Governance Code, the Supervisory Board devoted considerable time during
2019 to discussing and assessing QIAGEN’s corporate strategy, main risks and opportunities, and an annual
assessment by the Managing Board of the design and effectiveness of internal risk management and control systems
as well as any significant changes in them. In addition, the Supervisory Board discussed and reviewed the
functioning of its committees and individual members, its current composition, competence, succession schedule and
desired profile in various meetings and through written surveys.

The Supervisory Board met seven times during 2019, and conducted 15 telephone conference calls. These meetings
also included regular attendance of the members of the Managing Board for certain agenda items. The Supervisory
Board also met to review and discuss agenda items in the absence of the Managing Board members, such as
performance and strategy as well as to discuss compensation matters. Information about the Supervisory Board
members, including positions held on other boards, is included in the Corporate Governance Report. All members of
the Supervisory Board had adequate time available to give sufficient attention to the concerns of the Company. The
Supervisory Board further discussed the performance of the Managing Board and concluded that it and the
Managing Board were functioning properly, especially in view of the regulations set forth in the Dutch Corporate
Governance Code.

Committees of the Supervisory Board

The Supervisory Board has established an Audit Committee (Chair Lawrence Rosen), a Compensation Committee
(Chair Elizabeth E. Tallett), a Selection and Appointment Committee (Chair Håkan Björklund), and a Science and
Technology Committee (Chair Metin Colpan) from among its members. The Supervisory Board reserves the right to
establish other committees as deemed beneficial, and has approved charters under which each of these committees
operates. Charters are available on our website at www.QIAGEN.com.

The deliberations and findings of the committees were reported by the committee chairs to the Supervisory Board in
its meetings on a regular basis. All committee members attended all committee meetings in 2019 physically or by
phone. Further detailed information on the composition of the Supervisory Board and its committees, the number of
committee meetings held in 2019 and the main topics of discussion, the remuneration of its members, as well as
other information on the Supervisory Board, can be found in the Corporate Governance Report, which is an integral
part of this Annual Report.

Through its Compensation Committee, the Supervisory Board executed and monitored compliance with the
Remuneration Policy approved at the Annual General Meeting held on June 25, 2014. Compensation of Managing
Board members consists of a fixed salary and variable components. Variable compensation includes one-time and
annual payments linked to business performance (bonuses) as well as long-term incentives, such as share-based
compensation, and pension plans. The Remuneration Policy and the various aspects of compensation, including the
detailed remuneration of individual Managing Board members, are described in the Remuneration Report, which is
available on QIAGEN’s website. Information on QIAGEN’s activities was communicated by the Managing Board to
the Supervisory Board through regular meetings and business reports.

Corporate Governance

All members of the Supervisory Board fulfill the independence criteria as defined by the Dutch Corporate
Governance Code. The Supervisory Board follows the principle of increasing shareholder value as the members
represent the interests of all stakeholders, including shareholders, and has always pursued the highest standards in
corporate governance.

QIAGEN is committed to a corporate governance structure that best suits its business and stakeholders, and that
complies with relevant rules and regulations. QIAGEN follows the principles described in the Dutch Corporate
Governance Code, although some minor deviations, which are explained in detail in our Corporate Governance
10
Report, may result from the impact of factors such as legal requirements imposed on QIAGEN or industry standards.

QIAGEN’s common shares are registered and traded in the U.S. on the New York Stock Exchange (NYSE) as of

January 2018 (formerly on the NASDAQ Global Select Market) and in Germany on the Frankfurt Stock Exchange in

the Prime Standard segment. Shareholders in Europe and the U.S. hold the majority of common shares. As a result of

these listings for its Global Shares, QIAGEN is subject to the rules regarding corporate governance set by the NYSE.

QIAGEN believes all of its operations are carried out in accordance with legal frameworks, including Dutch

Corporate Law, U.S. laws and regulations, EU regulations and applicable German capital market laws.

Financial Statements and Audits

In this Annual Report, the financial statements for 2019 are presented as prepared by the Managing Board and

audited by KPMG (Independent Registered Public Accounting Firm). We examined the financial statements, the

proposal for the use of the distributable profit, the consolidated financial statements and the Management report. We

have no objections, thus we concur with the results of the audit, and it has been approved by the Supervisory Board.

members, including positions held on other boards, is included in the Corporate Governance Report. All members of

the Supervisory Board had adequate time available to give sufficient attention to the concerns of the Company. The

Supervisory Board further discussed the performance of the Managing Board and concluded that it and the

Managing Board were functioning properly, especially in view of the regulations set forth in the Dutch Corporate

Governance Code.

Committees of the Supervisory Board

The Supervisory Board has established an Audit Committee (Chair Lawrence Rosen), a Compensation Committee

(Chair Elizabeth E. Tallett), a Selection and Appointment Committee (Chair Håkan Björklund), and a Science and

Technology Committee (Chair Metin Colpan) from among its members. The Supervisory Board reserves the right to

establish other committees as deemed beneficial, and has approved charters under which each of these committees

operates. Charters are available on our website at www.QIAGEN.com.

The deliberations and findings of the committees were reported by the committee chairs to the Supervisory Board in

its meetings on a regular basis. All committee members attended all committee meetings in 2019 physically or by

phone. Further detailed information on the composition of the Supervisory Board and its committees, the number of

committee meetings held in 2019 and the main topics of discussion, the remuneration of its members, as well as

other information on the Supervisory Board, can be found in the Corporate Governance Report, which is an integral

part of this Annual Report.

Through its Compensation Committee, the Supervisory Board executed and monitored compliance with the

Remuneration Policy approved at the Annual General Meeting held on June 25, 2014. Compensation of Managing

Board members consists of a fixed salary and variable components. Variable compensation includes one-time and

annual payments linked to business performance (bonuses) as well as long-term incentives, such as share-based

compensation, and pension plans. The Remuneration Policy and the various aspects of compensation, including the

detailed remuneration of individual Managing Board members, are described in the Remuneration Report, which is

available on QIAGEN’s website. Information on QIAGEN’s activities was communicated by the Managing Board to

the Supervisory Board through regular meetings and business reports.

O V E R V I E W Report of the Supervisory Board
Corporate Governance

All members of the Supervisory Board fulfill the independence criteria as defined by the Dutch Corporate
Governance Code. The Supervisory Board follows the principle of increasing shareholder value as the members
represent the interests of all stakeholders, including shareholders, and has always pursued the highest standards in
corporate governance.

QIAGEN is committed to a corporate governance structure that best suits its business and stakeholders, and that
complies with relevant rules and regulations. QIAGEN follows the principles described in the Dutch Corporate
Governance Code, although some minor deviations, which are explained in detail in our Corporate Governance
Report, may result from the impact of factors such as legal requirements imposed on QIAGEN or industry standards.

QIAGEN’s common shares are registered and traded in the U.S. on the New York Stock Exchange (NYSE) as of
January 2018 (formerly on the NASDAQ Global Select Market) and in Germany on the Frankfurt Stock Exchange in
the Prime Standard segment. Shareholders in Europe and the U.S. hold the majority of common shares. As a result of
these listings for its Global Shares, QIAGEN is subject to the rules regarding corporate governance set by the NYSE.
QIAGEN believes all of its operations are carried out in accordance with legal frameworks, including Dutch
Corporate Law, U.S. laws and regulations, EU regulations and applicable German capital market laws.

Financial Statements and Audits

In this Annual Report, the financial statements for 2019 are presented as prepared by the Managing Board and
audited by KPMG (Independent Registered Public Accounting Firm). We examined the financial statements, the
proposal for the use of the distributable profit, the consolidated financial statements and the Management report. We
have no objections, thus we concur with the results of the audit, and it has been approved by the Supervisory Board.

In closing, the Supervisory Board would like to again thank all QIAGEN employees for the outstanding performance
and commitment during an eventful year.

Venlo, the Netherlands, April 2020

The Supervisory Board:

Dr. Håkan Björklund

Chairman of the Supervisory Board

11

Overview
Overview

Common Shares
The Executive Committee

Overview

QIAGEN’s common share price fluctuated widely in U.S. and European markets in 2019 but ended the year close to
starting price levels. The performance was influenced by challenges facing sales growth, successful initiatives to
improve profitability and a review of strategic options for QIAGEN. We thank shareholders for their support.
QIAGEN’s senior executives and Investor Relations team have been recognized for proactive, transparent
communications with the financial community.

The Executive Committee
Market Environment

Stock markets globally moved up in 2019 after a weak year in 2018. During 2019, investors responded to
accommodative monetary policy including interest rate cuts by the U.S. Federal Reserve and European Central Bank,
Thierry Bernard
Stephany Foster
as well as some additional clarity in trade relationships. Slower economic growth and geopolitical strains in 2019
Chief Executive Officer
Senior Vice President and Head of
caused uncertainties for investors but did not prevent brisk advances in stock prices in markets around the world.
Human Resources

Dr. Barthold Piening
Senior Vice President, Head of Global
Operations 

Market benchmarks for the year were very strong. The S&P 500 index in the United States finished up 28.9% in
2019, while the NASDAQ Biotechnology Index in the U.S. finished up 26.8%. The DAX index of the 30 largest
companies in Germany rose 25.5% during the year, and Germany’s TecDAX, of which QIAGEN is a member,
improved by 23.0% for the year.

Dr. Barthold Piening
Senior Vice President, Head of Global
Operations 

Thierry Bernard
Stephany Foster
The molecular diagnostics and life science tools segment grew at a healthy pace in 2019. Expanding use of new
Chief Executive Officer
Senior Vice President and Head of
technologies such as next-generation sequencing (NGS), liquid biopsies and gene editing helped drive demand for
Human Resources
molecular testing instruments and consumables in research. Funding for academic and pharmaceutical research grew
at mid-single digit rates. In healthcare, molecular testing continued to disseminate for precision medicine in oncology,
diagnosis of infectious diseases and identification of rare diseases, despite uncertainties in reimbursement and
Roland Sackers
Dr. Thomas Schweins
government policies. In 2019 QIAGEN delivered 4% growth in net sales at constant exchange rates (CER) and 9%
Senior Vice President, Life Science
Chief Financial Officer
growth in adjusted earnings per share CER. QIAGEN sales grew among its Molecular Diagnostics and Life Sciences
Business Area 
(Pharma and Academia/Applied Testing) customers, led by the Americas and Europe/Middle East/Africa regions.
Growth drivers included the QuantiFERON-TB tests, universal NGS technologies, QIAsymphony and QIAstat-Dx
automation systems, and the Precision Medicine portfolio. QIAGEN intensified its focus in 2019 to allocate resources
Jean-Pascal Viola
to the highest-potential growth drivers in its Sample to Insight portfolio while improving profitability, enhancing
Senior Vice President, Head of
shareholder value and maintaining flexibility.
Corporate Business Development &
Intellectual Property & Litigation
Roland Sackers
Global shares listed in the U.S. and Europe
Chief Financial Officer

Dr. Jonathan Sheldon
Senior Vice President, QIAGEN
Digital Insights Business Area 

Dr. Thomas Schweins
Senior Vice President, Life Science
Business Area 

Dr. Jonathan Sheldon
Senior Vice President, QIAGEN
Digital Insights Business Area 

QIAGEN’s global shares have been registered and traded in the United States since 1996, trading on the New York
Stock Exchange since January 10, 2018, after listing for more than 20 years on NASDAQ markets. The global
Chief Executive Officer
shares also have traded in Germany on the Frankfurt Stock Exchange since 1997, and the Prime Standard segment
Jean-Pascal Viola
since its launch in 2003. The dual listing of global shares on NYSE and the Frankfurt exchange offers advantages for
Senior Vice President, Head of
QIAGEN, our shareholders and employees, increasing the potential market opportunity to attract investors,
Joined QIAGEN in February 2015 to lead QIAGEN’s growing presence in Molecular Diagnostics, the application of
Corporate Business Development &
particularly those in the U.S. that can only invest in U.S. dollar-denominated investments, and enhances liquidity.
Sample to Insight solutions for molecular testing in human healthcare. He was named Chief Executive Officer in
Intellectual Property & Litigation
Unlike American Depositary Receipts (ADRs), QIAGEN’s global shares provide equal rights for all shareholders and
March 2020, after having previously served in this role on an interim basis. Mr. Bernard previously worked at
can be traded on either exchange, in U.S. dollars or euros.
bioMérieux, where he served in roles of increasing responsibility for 15 years, most recently as Corporate Vice
President, Global Commercial Operations, Investor Relations and the Greater China Region. Prior to joining
bioMérieux, he served in management roles in multiple international environments. Mr. Bernard is a member of the
Share Price and Liquidity
Boards of Directors of three privately held U.S. companies, First Light Biosciences, HepatoChem and more recently,
Chief Executive Officer
Daktari Diagnostics, where he also served as CEO. He has earned degrees from Sciences Po (Paris), Harvard

12
Joined QIAGEN in February 2015 to lead QIAGEN’s growing presence in Molecular Diagnostics, the application of
Sample to Insight solutions for molecular testing in human healthcare. He was named Chief Executive Officer in
March 2020, after having previously served in this role on an interim basis. Mr. Bernard previously worked at

bioMérieux, where he served in roles of increasing responsibility for 15 years, most recently as Corporate Vice

President, Global Commercial Operations, Investor Relations and the Greater China Region. Prior to joining

bioMérieux, he served in management roles in multiple international environments. Mr. Bernard is a member of the

Boards of Directors of three privately held U.S. companies, First Light Biosciences, HepatoChem and more recently,

Daktari Diagnostics, where he also served as CEO. He has earned degrees from Sciences Po (Paris), Harvard

Thierry BernardThierry BernardOverview

The Executive Committee

Thierry Bernard

Chief Executive Officer

Stephany Foster

Dr. Barthold Piening

Senior Vice President and Head of

Senior Vice President, Head of Global

Human Resources

Operations 

Roland Sackers

Chief Financial Officer

Dr. Thomas Schweins

Dr. Jonathan Sheldon

Senior Vice President, Life Science

Senior Vice President, QIAGEN

Business Area 

Digital Insights Business Area 

O V E R V I E W The Executive Committee

Jean-Pascal Viola
Senior Vice President, Head of
Corporate Business Development &
Intellectual Property & Litigation

Chief Executive Officer

Joined QIAGEN in February 2015 to lead QIAGEN’s growing presence in Molecular Diagnostics, the application of
Sample to Insight solutions for molecular testing in human healthcare. He was named Chief Executive Officer in
March 2020, after having previously served in this role on an interim basis. Mr. Bernard previously worked at
bioMérieux, where he served in roles of increasing responsibility for 15 years, most recently as Corporate Vice
President, Global Commercial Operations, Investor Relations and the Greater China Region. Prior to joining
bioMérieux, he served in management roles in multiple international environments. Mr. Bernard is a member of the
Boards of Directors of three privately held U.S. companies, First Light Biosciences, HepatoChem and more recently,
Daktari Diagnostics, where he also served as CEO. He has earned degrees from Sciences Po (Paris), Harvard
Business School, London School of Economics and the College of Europe and is a member of French Foreign Trade
Advisors.

Senior Vice President and Head of Human Resources

Joined QIAGEN in 2005 as Head of Global Internal Audit and was most recently Vice President, Head of Global
Compensation and Benefits. Ms. Foster was also member of the NAELT (North America Executive Leadership Team)
and steers the Diversity and Inclusion program at QIAGEN. She was named to her current role in October 2019.
Prior to joining QIAGEN, Stephany Foster worked in internal audit at MorganFranklin and Independence Air. She
started her career at PricewaterhouseCoopers, specializing in Sarbanes Oxley Auditing. Ms. Foster has a master’s
degree in Accounting from the University of Notre Dame and is a Certified Public Accountant (CPA), a Certified
Internal and Information Systems Auditor (CIA / CISA) and Certified Fraud Examiner (CFE).

Senior Vice President, Head of Global Operations

Joined QIAGEN in December 2018 as Senior Vice President, Head of Global Operations, and a member of the
Executive Committee. Dr. Piening has more than 30 years of experience in strategy and operations in the
pharmaceutical, life science and medical device industries. Prior to joining QIAGEN, he was Executive Board
member in charge of production and technology for the German pharma company STADA. Dr. Piening had
previously served as Chief Operating Officer and EC member of Acino Pharma, and before that as Head of Global
Operations for Takeda Pharmaceuticals International. Earlier, he had roles of increasing responsibility at Byk
Gulden, ALTANA Pharma and Nycomed. After studying pharmaceutical sciences at the University of Kiel in
Germany and the University of Wales in Cardiff, U.K., he earned a degree in Pharmaceutics with Approbation and
a Ph.D. in Pharmaceutical Chemistry from the University of Kiel. He also earned an MBA at WHU-Vallendar in
Germany and Northwestern University in the United States.

Chief Financial Officer

Joined QIAGEN in 1999 as Vice President Finance and has been Chief Financial Officer since 2004. In 2006, Mr.
Sackers became a member of the Managing Board. Between 1995 and 1999, he served as an auditor with Arthur
Andersen Wirtschaftsprüfungsgesellschaft Steuerberatungsgesellschaft. Mr. Sackers earned his Masters Degree in
Business Administration (Diplom-Kaufmann) from the University of Münster, Germany. He is a board member of the
industry association BIO Deutschland. Mr. Sackers has been a member of the Supervisory Board and Chairman of
the Audit Committee of Evotec SE since 2019.

Senior Vice President, Life Science Business Area

Joined QIAGEN in 2004 as Vice President Corporate Strategy and was appointed Vice President Marketing &
Strategy in 2005, where he was deeply involved in managing the global business toward Life Science customers. In

13

late 2011, Dr. Schweins assumed responsibility for Human Resources and initiated a multi-year transformation

process to increase efficiency and effectiveness of the function. In 2017, Dr. Schweins took over the leadership of the

Life Science Business Area and consequently resigned from his role as head of HR. Dr. Schweins came to QIAGEN

from The Boston Consulting Group. He previously worked as Technology Manager, and later as an Assistant to the

Management Board at Hoechst / Aventis. Dr. Schweins earned an M.Sc. Degree in Biochemistry from the University

of Hanover. He obtained his Ph.D. at the Max Planck Society and received an M.Sc. from the University of Southern

California in Los Angeles, where he studied Business Administration and Chemistry.

Senior Vice President, QIAGEN Digital Insights Business Area

Thierry BernardStephany FosterDr. Barthold PieningRoland SackersDr. Thomas SchweinsDr. Jonathan SheldonBusiness School, London School of Economics and the College of Europe and is a member of French Foreign Trade

Advisors.

Senior Vice President and Head of Human Resources

Joined QIAGEN in 2005 as Head of Global Internal Audit and was most recently Vice President, Head of Global

Compensation and Benefits. Ms. Foster was also member of the NAELT (North America Executive Leadership Team)

and steers the Diversity and Inclusion program at QIAGEN. She was named to her current role in October 2019.

Prior to joining QIAGEN, Stephany Foster worked in internal audit at MorganFranklin and Independence Air. She

started her career at PricewaterhouseCoopers, specializing in Sarbanes Oxley Auditing. Ms. Foster has a master’s

degree in Accounting from the University of Notre Dame and is a Certified Public Accountant (CPA), a Certified

Internal and Information Systems Auditor (CIA / CISA) and Certified Fraud Examiner (CFE).

Senior Vice President, Head of Global Operations

Joined QIAGEN in December 2018 as Senior Vice President, Head of Global Operations, and a member of the

Executive Committee. Dr. Piening has more than 30 years of experience in strategy and operations in the

pharmaceutical, life science and medical device industries. Prior to joining QIAGEN, he was Executive Board

member in charge of production and technology for the German pharma company STADA. Dr. Piening had

previously served as Chief Operating Officer and EC member of Acino Pharma, and before that as Head of Global

Operations for Takeda Pharmaceuticals International. Earlier, he had roles of increasing responsibility at Byk

Gulden, ALTANA Pharma and Nycomed. After studying pharmaceutical sciences at the University of Kiel in

Germany and the University of Wales in Cardiff, U.K., he earned a degree in Pharmaceutics with Approbation and

a Ph.D. in Pharmaceutical Chemistry from the University of Kiel. He also earned an MBA at WHU-Vallendar in

Germany and Northwestern University in the United States.

Chief Financial Officer

Joined QIAGEN in 1999 as Vice President Finance and has been Chief Financial Officer since 2004. In 2006, Mr.
Sackers became a member of the Managing Board. Between 1995 and 1999, he served as an auditor with Arthur
Andersen Wirtschaftsprüfungsgesellschaft Steuerberatungsgesellschaft. Mr. Sackers earned his Masters Degree in
Business Administration (Diplom-Kaufmann) from the University of Münster, Germany. He is a board member of the
industry association BIO Deutschland. Mr. Sackers has been a member of the Supervisory Board and Chairman of
the Audit Committee of Evotec SE since 2019.

Senior Vice President, Life Science Business Area

Joined QIAGEN in 2004 as Vice President Corporate Strategy and was appointed Vice President Marketing &
Strategy in 2005, where he was deeply involved in managing the global business toward Life Science customers. In
late 2011, Dr. Schweins assumed responsibility for Human Resources and initiated a multi-year transformation
process to increase efficiency and effectiveness of the function. In 2017, Dr. Schweins took over the leadership of the
Life Science Business Area and consequently resigned from his role as head of HR. Dr. Schweins came to QIAGEN
from The Boston Consulting Group. He previously worked as Technology Manager, and later as an Assistant to the
Management Board at Hoechst / Aventis. Dr. Schweins earned an M.Sc. Degree in Biochemistry from the University
of Hanover. He obtained his Ph.D. at the Max Planck Society and received an M.Sc. from the University of Southern
California in Los Angeles, where he studied Business Administration and Chemistry.

Senior Vice President, QIAGEN Digital Insights Business Area

Joined QIAGEN in 2018 as Senior Vice President, QIAGEN Digital Insights Business Area. He leads QIAGEN's
growing presence in bioinformatics, enabling customers to transform raw data from biological samples into valuable
molecular insights. Dr. Sheldon came to QIAGEN from Oracle, where he was Global Vice President leading
Oracle's Healthcare business globally in the Health Sciences Global Business Unit and served on the executive
committee. Previously, he established the bioinformatics group and served as Head of Bioinformatics at Roche (UK)
Pharmaceuticals, as well as providing leadership in software firms serving the life science and healthcare sectors. He
serves on the Board of Directors of the Drug Information Association (DIA). He received his B.Sc. in Biochemistry and
Molecular Biology from the University of Manchester, and his Ph.D. in Biochemistry and Molecular Biology from the
University of Cambridge.

Senior Vice President, Head of Corporate Business Development & Intellectual Property & Litigation

Joined QIAGEN in 2005 and worked in increasingly responsible roles until he was named Senior Vice President,
Corporate Business Development, Intellectual Property & Litigation, in 2015. In October 2019, Mr. Viola was
appointed member of the Executive Committee. He leads global efforts to expand QIAGEN’s portfolio through
acquisitions and strategic partnerships, as well as the protection of the company’s intellectual property. Among other
business transactions, his track record includes the acquisitions of Cellestis, Corbett Life Science, DxS and
Enzymatics. Prior to joining QIAGEN, Mr. Viola served as President and CEO of Nextal Biotechnologies Inc., a
provider of technologies for protein crystallization, and when QIAGEN acquired Nextal in 2005 he joined as
Director of Protein Crystallization. Moving to Business Development in 2007, Mr. Viola led efforts in Asia-Pacific, the
Americas, Global M&A and Corporate Ventures. He completed a Bachelor of Science in Biochemistry from the
University of Montreal, Canada.

14

Stephany FosterDr. Barthold PieningRoland SackersDr. Thomas SchweinsDr. Jonathan SheldonJean-Pascal ViolaO V E R V I E W The Executive Committee

15

Overview
Overview

Common Shares
Overview
Common Shares
QIAGEN’s common share price fluctuated widely in U.S. and European 
QIAGEN’s common share price fluctuated widely in U.S. and European markets in 2019 but ended the year close to
markets in 2019 but ended the year close to starting price levels. The perfor-
starting price levels. The performance was influenced by challenges facing sales growth, successful initiatives to
QIAGEN’s common share price fluctuated widely in U.S. and European markets in 2019 but ended the year close to
Common Shares
improve profitability and a review of strategic options for QIAGEN. We thank shareholders for their support.
starting price levels. The performance was influenced by challenges facing sales growth, successful initiatives to
mance was influenced by challenges facing sales growth, successful initia-
QIAGEN’s senior executives and Investor Relations team have been recognized for proactive, transparent
improve profitability and a review of strategic options for QIAGEN. We thank shareholders for their support.
tives to improve profitability and a review of strategic options for QIAGEN. 
communications with the financial community.
QIAGEN’s senior executives and Investor Relations team have been recognized for proactive, transparent
QIAGEN’s common share price fluctuated widely in U.S. and European markets in 2019 but ended the year close to
communications with the financial community.
We thank shareholders for their support. QIAGEN’s senior executives and 
starting price levels. The performance was influenced by challenges facing sales growth, successful initiatives to
Market Environment
Investor Relations team have been recognized for proactive, transparent 
improve profitability and a review of strategic options for QIAGEN. We thank shareholders for their support.
Market Environment
QIAGEN’s senior executives and Investor Relations team have been recognized for proactive, transparent
communications with the financial community.
Stock markets globally moved up in 2019 after a weak year in 2018. During 2019, investors responded to
communications with the financial community.
accommodative monetary policy including interest rate cuts by the U.S. Federal Reserve and European Central Bank,
Stock markets globally moved up in 2019 after a weak year in 2018. During 2019, investors responded to
as well as some additional clarity in trade relationships. Slower economic growth and geopolitical strains in 2019
accommodative monetary policy including interest rate cuts by the U.S. Federal Reserve and European Central Bank,
caused uncertainties for investors but did not prevent brisk advances in stock prices in markets around the world.
Market Environment
as well as some additional clarity in trade relationships. Slower economic growth and geopolitical strains in 2019
caused uncertainties for investors but did not prevent brisk advances in stock prices in markets around the world.
Stock markets globally moved up in 2019 after a weak year in 2018. During 2019, investors responded to
Market benchmarks for the year were very strong. The S&P 500 index in the United States finished up 28.9% in
accommodative monetary policy including interest rate cuts by the U.S. Federal Reserve and European Central Bank,
2019, while the NASDAQ Biotechnology Index in the U.S. finished up 26.8%. The DAX index of the 30 largest
Market benchmarks for the year were very strong. The S&P 500 index in the United States finished up 28.9% in
as well as some additional clarity in trade relationships. Slower economic growth and geopolitical strains in 2019
companies in Germany rose 25.5% during the year, and Germany’s TecDAX, of which QIAGEN is a member,
2019, while the NASDAQ Biotechnology Index in the U.S. finished up 26.8%. The DAX index of the 30 largest
caused uncertainties for investors but did not prevent brisk advances in stock prices in markets around the world.
improved by 23.0% for the year.
companies in Germany rose 25.5% during the year, and Germany’s TecDAX, of which QIAGEN is a member,
improved by 23.0% for the year.
Market benchmarks for the year were very strong. The S&P 500 index in the United States finished up 28.9% in
The molecular diagnostics and life science tools segment grew at a healthy pace in 2019. Expanding use of new
2019, while the NASDAQ Biotechnology Index in the U.S. finished up 26.8%. The DAX index of the 30 largest
technologies such as next-generation sequencing (NGS), liquid biopsies and gene editing helped drive demand for
The molecular diagnostics and life science tools segment grew at a healthy pace in 2019. Expanding use of new
companies in Germany rose 25.5% during the year, and Germany’s TecDAX, of which QIAGEN is a member,
molecular testing instruments and consumables in research. Funding for academic and pharmaceutical research grew
technologies such as next-generation sequencing (NGS), liquid biopsies and gene editing helped drive demand for
improved by 23.0% for the year.
at mid-single digit rates. In healthcare, molecular testing continued to disseminate for precision medicine in oncology,
molecular testing instruments and consumables in research. Funding for academic and pharmaceutical research grew
diagnosis of infectious diseases and identification of rare diseases, despite uncertainties in reimbursement and
at mid-single digit rates. In healthcare, molecular testing continued to disseminate for precision medicine in oncology,
The molecular diagnostics and life science tools segment grew at a healthy pace in 2019. Expanding use of new
government policies. In 2019 QIAGEN delivered 4% growth in net sales at constant exchange rates (CER) and 9%
diagnosis of infectious diseases and identification of rare diseases, despite uncertainties in reimbursement and
technologies such as next-generation sequencing (NGS), liquid biopsies and gene editing helped drive demand for
growth in adjusted earnings per share CER. QIAGEN sales grew among its Molecular Diagnostics and Life Sciences
government policies. In 2019 QIAGEN delivered 4% growth in net sales at constant exchange rates (CER) and 9%
molecular testing instruments and consumables in research. Funding for academic and pharmaceutical research grew
(Pharma and Academia/Applied Testing) customers, led by the Americas and Europe/Middle East/Africa regions.
growth in adjusted earnings per share CER. QIAGEN sales grew among its Molecular Diagnostics and Life Sciences
at mid-single digit rates. In healthcare, molecular testing continued to disseminate for precision medicine in oncology,
Growth drivers included the QuantiFERON-TB tests, universal NGS technologies, QIAsymphony and QIAstat-Dx
(Pharma and Academia/Applied Testing) customers, led by the Americas and Europe/Middle East/Africa regions.
diagnosis of infectious diseases and identification of rare diseases, despite uncertainties in reimbursement and
automation systems, and the Precision Medicine portfolio. QIAGEN intensified its focus in 2019 to allocate resources
Growth drivers included the QuantiFERON-TB tests, universal NGS technologies, QIAsymphony and QIAstat-Dx
government policies. In 2019 QIAGEN delivered 4% growth in net sales at constant exchange rates (CER) and 9%
to the highest-potential growth drivers in its Sample to Insight portfolio while improving profitability, enhancing
automation systems, and the Precision Medicine portfolio. QIAGEN intensified its focus in 2019 to allocate resources
growth in adjusted earnings per share CER. QIAGEN sales grew among its Molecular Diagnostics and Life Sciences
shareholder value and maintaining flexibility.
to the highest-potential growth drivers in its Sample to Insight portfolio while improving profitability, enhancing
(Pharma and Academia/Applied Testing) customers, led by the Americas and Europe/Middle East/Africa regions.
shareholder value and maintaining flexibility.
Growth drivers included the QuantiFERON-TB tests, universal NGS technologies, QIAsymphony and QIAstat-Dx
Global Shares Listed in the U.S. and Europe
automation systems, and the Precision Medicine portfolio. QIAGEN intensified its focus in 2019 to allocate resources
to the highest-potential growth drivers in its Sample to Insight portfolio while improving profitability, enhancing
Global shares listed in the U.S. and Europe
QIAGEN’s global shares have been registered and traded in the United States since 1996, trading on the New York
shareholder value and maintaining flexibility.
Stock Exchange since January 10, 2018, after listing for more than 20 years on NASDAQ markets. The global
QIAGEN’s global shares have been registered and traded in the United States since 1996, trading on the New York
shares also have traded in Germany on the Frankfurt Stock Exchange since 1997, and the Prime Standard segment
Stock Exchange since January 10, 2018, after listing for more than 20 years on NASDAQ markets. The global
Global Shares Listed in the U.S. and Europe
since its launch in 2003. The dual listing of global shares on NYSE and the Frankfurt exchange offers advantages for
shares also have traded in Germany on the Frankfurt Stock Exchange since 1997, and the Prime Standard segment
QIAGEN, our shareholders and employees, increasing the potential market opportunity to attract investors,
since its launch in 2003. The dual listing of global shares on NYSE and the Frankfurt exchange offers advantages for
QIAGEN’s global shares have been registered and traded in the United States since 1996, trading on the New York
particularly those in the U.S. that can only invest in U.S. dollar-denominated investments, and enhances liquidity.
QIAGEN, our shareholders and employees, increasing the potential market opportunity to attract investors,
Stock Exchange since January 10, 2018, after listing for more than 20 years on NASDAQ markets. The global
Unlike American Depositary Receipts (ADRs), QIAGEN’s global shares provide equal rights for all shareholders and
particularly those in the U.S. that can only invest in U.S. dollar-denominated investments, and enhances liquidity.
shares also have traded in Germany on the Frankfurt Stock Exchange since 1997, and the Prime Standard segment
can be traded on either exchange, in U.S. dollars or euros.
Unlike American Depositary Receipts (ADRs), QIAGEN’s global shares provide equal rights for all shareholders and
since its launch in 2003. The dual listing of global shares on NYSE and the Frankfurt exchange offers advantages for
can be traded on either exchange, in U.S. dollars or euros.
QIAGEN, our shareholders and employees, increasing the potential market opportunity to attract investors,
particularly those in the U.S. that can only invest in U.S. dollar-denominated investments, and enhances liquidity.
Share Price and Liquidity
Unlike American Depositary Receipts (ADRs), QIAGEN’s global shares provide equal rights for all shareholders and
Share Price and Liquidity
can be traded on either exchange, in U.S. dollars or euros.

Share Price and Liquidity

16

Overview

Common Shares

QIAGEN’s common share price fluctuated widely in U.S. and European markets in 2019 but ended the year close to

starting price levels. The performance was influenced by challenges facing sales growth, successful initiatives to

improve profitability and a review of strategic options for QIAGEN. We thank shareholders for their support.

QIAGEN’s senior executives and Investor Relations team have been recognized for proactive, transparent

communications with the financial community.

Market Environment

Stock markets globally moved up in 2019 after a weak year in 2018. During 2019, investors responded to

accommodative monetary policy including interest rate cuts by the U.S. Federal Reserve and European Central Bank,

as well as some additional clarity in trade relationships. Slower economic growth and geopolitical strains in 2019

caused uncertainties for investors but did not prevent brisk advances in stock prices in markets around the world.

Market benchmarks for the year were very strong. The S&P 500 index in the United States finished up 28.9% in

2019, while the NASDAQ Biotechnology Index in the U.S. finished up 26.8%. The DAX index of the 30 largest

companies in Germany rose 25.5% during the year, and Germany’s TecDAX, of which QIAGEN is a member,

improved by 23.0% for the year.

The molecular diagnostics and life science tools segment grew at a healthy pace in 2019. Expanding use of new

technologies such as next-generation sequencing (NGS), liquid biopsies and gene editing helped drive demand for

molecular testing instruments and consumables in research. Funding for academic and pharmaceutical research grew

at mid-single digit rates. In healthcare, molecular testing continued to disseminate for precision medicine in oncology,

diagnosis of infectious diseases and identification of rare diseases, despite uncertainties in reimbursement and

government policies. In 2019 QIAGEN delivered 4% growth in net sales at constant exchange rates (CER) and 9%

growth in adjusted earnings per share CER. QIAGEN sales grew among its Molecular Diagnostics and Life Sciences

(Pharma and Academia/Applied Testing) customers, led by the Americas and Europe/Middle East/Africa regions.

Growth drivers included the QuantiFERON-TB tests, universal NGS technologies, QIAsymphony and QIAstat-Dx

automation systems, and the Precision Medicine portfolio. QIAGEN intensified its focus in 2019 to allocate resources

to the highest-potential growth drivers in its Sample to Insight portfolio while improving profitability, enhancing

shareholder value and maintaining flexibility.

Global Shares Listed in the U.S. and Europe

QIAGEN’s global shares have been registered and traded in the United States since 1996, trading on the New York

Stock Exchange since January 10, 2018, after listing for more than 20 years on NASDAQ markets. The global

shares also have traded in Germany on the Frankfurt Stock Exchange since 1997, and the Prime Standard segment
since its launch in 2003. The dual listing of global shares on NYSE and the Frankfurt exchange offers advantages for
O V E R V I E W Common Shares
QIAGEN, our shareholders and employees, increasing the potential market opportunity to attract investors,
particularly those in the U.S. that can only invest in U.S. dollar-denominated investments, and enhances liquidity.
Unlike American Depositary Receipts (ADRs), QIAGEN’s global shares provide equal rights for all shareholders and
can be traded on either exchange, in U.S. dollars or euros.

Share Price and Liquidity

QIAGEN’s share price performance was mixed in 2019, declining 1.9% in U.S. dollars to $33.80 on the NYSE and
rising 2.6% in euros to EUR 30.46 on the Frankfurt Stock Exchange (XETRA). Our shares continued to offer high
liquidity, with average daily trading volume of approximately three million shares in 2019 (two million on the NYSE
and other U.S. trading venues, and about one million on the Frankfurt Stock Exchange (XETRA) and other German
exchanges). QIAGEN continued its commitment to disciplined capital allocation and shareholder returns. During
2019, QIAGEN repurchased 2.0 million shares on the Frankfurt Stock Exchange, under a program announced in
January 2018. This program ended June 30, 2019, with a total of 4.9 million shares repurchased in 2018 and
2019 at an average price of EUR 32.0528 per share, for a total value of EUR 155.7 million (approximately $180
million) at the times of the purchases. As of December 31, 2019, the free float, which affects weighting of QIAGEN
shares in various indices, was approximately 96%.

Shareholder Structure

QIAGEN has a global investor base comprised of more than 300 identified institutional investors, including about
half in North America, about one-third in Europe and the remaining shares in the Asia-Pacific/Japan region.
Members of the Managing Board and the Supervisory Board in total held about 2% of QIAGEN’s outstanding
common shares at the end of 2019.

Annual Shareholder Meeting

At the Annual General Meeting on June 17, 2019, in Venlo, the Netherlands, shareholders voted in favor of all
resolutions proposed by the Board of Directors, in many cases with majorities above 95% of the shares represented
at the meeting. Shareholders present or represented at the meeting held approximately 161.9 million shares, 70% of
QIAGEN’s approximately 230.8 million issued shares as of the record date for the meeting. Details of attendance
and voting results are available at https://corporate.QIAGEN.com.

Investor Relations and Engagement with Shareholders

QIAGEN is committed to offering shareholders, analysts and communities around the world transparent,
comprehensive and readily accessible information on our performance, strategy and future prospects, as well as our
vision and mission.

Interactions with existing and potential investors continued at an active pace through 2019, with QIAGEN executives
taking part in many individual discussions during roadshows and investor conferences around the world. QIAGEN
hosted an Analyst and Investor Day in New York on June 20, 2019, attended by about 100 market participants.
Some investors and analysts also visited our sites in Hilden, Germany, and Germantown, Maryland, during 2019.
Approximately 25 securities analysts, based in the United States, France, Germany and the United Kingdom,
followed QIAGEN in 2019.

QIAGEN Share Price Development and Average Trading Volume - NYSE 2019

Year-end price

High

Low

Average daily trading volume (in million shares)

$ 33.80

$ 43.16

$ 25.04

1.56

17

2019QIAGEN’s share price performance was mixed in 2019, declining 1.9% in U.S. dollars to $33.80 on the NYSE and

rising 2.6% in euros to EUR 30.46 on the Frankfurt Stock Exchange (XETRA). Our shares continued to offer high

liquidity, with average daily trading volume of approximately three million shares in 2019 (two million on the NYSE

and other U.S. trading venues, and about one million on the Frankfurt Stock Exchange (XETRA) and other German

exchanges). QIAGEN continued its commitment to disciplined capital allocation and shareholder returns. During

2019, QIAGEN repurchased 2.0 million shares on the Frankfurt Stock Exchange, under a program announced in

January 2018. This program ended June 30, 2019, with a total of 4.9 million shares repurchased in 2018 and

2019 at an average price of EUR 32.0528 per share, for a total value of EUR 155.7 million (approximately $180

million) at the times of the purchases. As of December 31, 2019, the free float, which affects weighting of QIAGEN

shares in various indices, was approximately 96%.

Shareholder Structure

QIAGEN has a global investor base comprised of more than 300 identified institutional investors, including about

half in North America, about one-third in Europe and the remaining shares in the Asia-Pacific/Japan region.

Members of the Managing Board and the Supervisory Board in total held about 2% of QIAGEN’s outstanding

common shares at the end of 2019.

Annual Shareholder Meeting

At the Annual General Meeting on June 17, 2019, in Venlo, the Netherlands, shareholders voted in favor of all

resolutions proposed by the Board of Directors, in many cases with majorities above 95% of the shares represented

at the meeting. Shareholders present or represented at the meeting held approximately 161.9 million shares, 70% of

QIAGEN’s approximately 230.8 million issued shares as of the record date for the meeting. Details of attendance

and voting results are available at https://corporate.QIAGEN.com.

Investor Relations and Engagement with Shareholders

QIAGEN is committed to offering shareholders, analysts and communities around the world transparent,

comprehensive and readily accessible information on our performance, strategy and future prospects, as well as our

vision and mission.

Interactions with existing and potential investors continued at an active pace through 2019, with QIAGEN executives
taking part in many individual discussions during roadshows and investor conferences around the world. QIAGEN
hosted an Analyst and Investor Day in New York on June 20, 2019, attended by about 100 market participants.
Some investors and analysts also visited our sites in Hilden, Germany, and Germantown, Maryland, during 2019.
Approximately 25 securities analysts, based in the United States, France, Germany and the United Kingdom,
followed QIAGEN in 2019.

QIAGEN Share Price Development and Average Trading Volume - NYSE 2019

Year-end price

High

Low

Average daily trading volume (in million shares)

$ 33.80

$ 43.16

$ 25.04

1.56

QIAGEN Share Price Development and Average Trading Volume - Frankfurt Stock Exchange
(XETRA) 2019

Year-end price

High

Low

Average daily trading volume (in million shares)

€ 30.46

€ 39.19

€ 22.54

0.60

18

20192019O V E R V I E W Common Shares

QIAGEN Share Price Development and Average Trading Volume - Frankfurt Stock Exchange
QIAGEN Share Price Development and Average Trading Volume - Frankfurt Stock Exchange
(XETRA) 2019
(XETRA) 2019

Year-end price

Year-end price

High

High

Low

Low

Average daily trading volume (in million shares)

Average daily trading volume (in million shares)

€ 30.46
€ 30.46

€ 39.19
€ 39.19

€ 22.54
€ 22.54

0.60

0.60

19

20192019Key Share Data

Year-end market capitalization (in $ million)

Year-end market capitalization (in € million)

Source: QIAGEN Shareholder ID

Source: QIAGEN Shareholder ID

United States

Germany

France

England

Other

49%

GARP

11%

Value

3%

Index

14%

Growth

18%

Other

Non-Institutional

5%

Non-Institutional

Source: QIAGEN Shareholder ID

Source: QIAGEN Shareholder ID

7,698

6,937

6%

5%

18%

64%

2%

5%

Key Share Data

Key Share Data

Year-end market capitalization (in $ million)

Year-end market capitalization (in € million)

Year-end market capitalization (in $ million)

7,698

Year-end market capitalization (in € million)

6,937

Source: QIAGEN Shareholder ID

Source: QIAGEN Shareholder ID

Source: QIAGEN Shareholder ID

Source: QIAGEN Shareholder ID

United States

Germany

France

England

Other

49%

GARP

11%

Value

3%

Index

14%

Growth

18%

Other

United States

Germany

France

England

Other

Non-Institutional

5%

Non-Institutional

Non-Institutional

6%

5%

18%

64%

2%

5%

49%

GARP

11%

Value

3%

Index

14%

Growth

18%

Other

5%

Non-Institutional

Source: QIAGEN Shareholder ID

Source: QIAGEN Shareholder ID

Source: QIAGEN Shareholder ID

Source: QIAGEN Shareholder ID

7,698

6,937

6%

5%

18%

64%

2%

5%

20

20192019201949%11%3%14%18%5%6%5%18%64%2%5%49%11%3%14%18%United StatesGermanyFranceEnglandOtherNon-institutional18%64%GARPValueIndexGrowthOtherNon-institutionalO V E R V I E W Common Shares

21

Management 
Report

024 Business and Operating Environment

054 Opportunities and Risks

076 Performance Review

088 Human Resources

092 Non-Financial Statement

108 Future Perspectives

M A N A G E M E N T   R E P O R T

Business and Operating Environment

23

Management Report
Management Report

Business and Operating Environment
Business and Operating Environment

QIAGEN is a global leader in Sample to Insight solutions that transform biological samples into valuable molecular
QIAGEN is a global leader in Sample to Insight solutions that transform biological samples into valuable molecular
insights. Our mission is to enable customers across the continuum of molecular testing to unlock valuable insights
insights. Our mission is to enable customers across the continuum of molecular testing to unlock valuable insights
faster, better and more efficiently - from the raw biological sample to the final interpreted result.
faster, better and more efficiently - from the raw biological sample to the final interpreted result.

We serve more than 500,000 customers in two broad customer groups: Molecular Diagnostics (human healthcare)
We serve more than 500,000 customers in two broad customer groups: Molecular Diagnostics (human healthcare)
and Life Sciences (academia, pharma R&D and industrial applications, primarily forensics). Proven QIAGEN
and Life Sciences (academia, pharma R&D and industrial applications, primarily forensics). Proven QIAGEN
solutions and content are providing answers in hospitals and laboratories worldwide, helping make sense of the
solutions and content are providing answers in hospitals and laboratories worldwide, helping make sense of the
increasing volumes and complexity of biological information, in keeping with our vision of making improvements in
increasing volumes and complexity of biological information, in keeping with our vision of making improvements in
life possible.
life possible.

QIAGEN began operations in 1986 as a pioneer in the emerging biotechnology sector, introducing a novel method
QIAGEN began operations in 1986 as a pioneer in the emerging biotechnology sector, introducing a novel method
that standardized and accelerated extraction and purification of nucleic acids from biological samples. As molecular
that standardized and accelerated extraction and purification of nucleic acids from biological samples. As molecular
biology and genomic knowledge have grown to influence many areas of life, QIAGEN has expanded to serve the
biology and genomic knowledge have grown to influence many areas of life, QIAGEN has expanded to serve the
full spectrum of market needs. We believe our sample technologies are unmatched in quality for isolating and
full spectrum of market needs. We believe our sample technologies are unmatched in quality for isolating and
preparing DNA (deoxyribonucleic acid), RNA (ribonucleic acid) and proteins from blood or other liquids, tissue,
preparing DNA (deoxyribonucleic acid), RNA (ribonucleic acid) and proteins from blood or other liquids, tissue,
plants or other materials. Our assay technologies amplify, enrich and make these biomolecules accessible for
plants or other materials. Our assay technologies amplify, enrich and make these biomolecules accessible for
analysis, such as identifying the genetic information of a pathogen or a gene mutation in a tumor. QIAGEN’s
analysis, such as identifying the genetic information of a pathogen or a gene mutation in a tumor. QIAGEN’s
industry-leading Digital Insights solutions allow users to analyze and interpret data with bioinformatics software and
industry-leading Digital Insights solutions allow users to analyze and interpret data with bioinformatics software and
knowledge bases to provide relevant, actionable insights. Our automation systems tie these technologies together in
knowledge bases to provide relevant, actionable insights. Our automation systems tie these technologies together in
seamless and cost-effective molecular testing workflows - from Sample to Insight.
seamless and cost-effective molecular testing workflows - from Sample to Insight.

Net sales of $1.53 billion in 2019 consisted of consumable kits and other revenues (89% of sales) and automation
Net sales of $1.53 billion in 2019 consisted of consumable kits and other revenues (89% of sales) and automation
systems and instruments (11% of sales). Approximately 48% of net sales in 2019 were in Molecular Diagnostics, and
systems and instruments (11% of sales). Approximately 48% of net sales in 2019 were in Molecular Diagnostics, and
52% in Life Sciences customer classes in the Academia / Applied Testing and Pharma markets.
52% in Life Sciences customer classes in the Academia / Applied Testing and Pharma markets.

QIAGEN has grown by developing new instruments, consumables and digital solutions to meet diverse and growing
QIAGEN has grown by developing new instruments, consumables and digital solutions to meet diverse and growing
needs in the market, partnering with researchers and Pharma companies, and acquiring companies or technologies
needs in the market, partnering with researchers and Pharma companies, and acquiring companies or technologies
to complement our portfolio. We believe the addressable global market for QIAGEN's portfolio of molecular testing
to complement our portfolio. We believe the addressable global market for QIAGEN's portfolio of molecular testing
products for customers across the continuum of life science research and molecular diagnostics totals more than $10
products for customers across the continuum of life science research and molecular diagnostics totals more than $10
billion.
billion.

We have funded our growth through internally generated funds, debt offerings, and private and public sales of
We have funded our growth through internally generated funds, debt offerings, and private and public sales of
equity securities. QIAGEN’s global shares are listed on the New York Stock Exchange under the ticker symbol
equity securities. QIAGEN’s global shares are listed on the New York Stock Exchange under the ticker symbol
QGEN and on the Frankfurt Prime Standard as QIA.
QGEN and on the Frankfurt Prime Standard as QIA.

The company is registered under its commercial and legal name QIAGEN N.V. with the trade register (kamer van
The company is registered under its commercial and legal name QIAGEN N.V. with the trade register (kamer van
koophandel) of the Dutch region Limburg Noord under file number 12036979. QIAGEN N.V. is a public limited
koophandel) of the Dutch region Limburg Noord under file number 12036979. QIAGEN N.V. is a public limited
liability company (naamloze vennootschap) under Dutch law as a holding company. Our principal executive office is
liability company (naamloze vennootschap) under Dutch law as a holding company. Our principal executive office is
located at Hulsterweg 82, 5912 PL Venlo, The Netherlands, and our telephone number is +31-77-355-6600.
located at Hulsterweg 82, 5912 PL Venlo, The Netherlands, and our telephone number is +31-77-355-6600.

As a holding company, QIAGEN conducts business through subsidiaries located throughout the world. Further
As a holding company, QIAGEN conducts business through subsidiaries located throughout the world. Further
information about QIAGEN can be found at www.QIAGEN.com. By referring to our website, we do not incorporate
information about QIAGEN can be found at www.QIAGEN.com. By referring to our website, we do not incorporate
the website or any portion of the website by reference into this Annual Report.
the website or any portion of the website by reference into this Annual Report.

24

Management Report

Business and Operating Environment

QIAGEN is a global leader in Sample to Insight solutions that transform biological samples into valuable molecular

insights. Our mission is to enable customers across the continuum of molecular testing to unlock valuable insights

faster, better and more efficiently - from the raw biological sample to the final interpreted result.

We serve more than 500,000 customers in two broad customer groups: Molecular Diagnostics (human healthcare)

and Life Sciences (academia, pharma R&D and industrial applications, primarily forensics). Proven QIAGEN

solutions and content are providing answers in hospitals and laboratories worldwide, helping make sense of the

increasing volumes and complexity of biological information, in keeping with our vision of making improvements in

life possible.

QIAGEN began operations in 1986 as a pioneer in the emerging biotechnology sector, introducing a novel method

that standardized and accelerated extraction and purification of nucleic acids from biological samples. As molecular

biology and genomic knowledge have grown to influence many areas of life, QIAGEN has expanded to serve the

full spectrum of market needs. We believe our sample technologies are unmatched in quality for isolating and

preparing DNA (deoxyribonucleic acid), RNA (ribonucleic acid) and proteins from blood or other liquids, tissue,

plants or other materials. Our assay technologies amplify, enrich and make these biomolecules accessible for

analysis, such as identifying the genetic information of a pathogen or a gene mutation in a tumor. QIAGEN’s

industry-leading Digital Insights solutions allow users to analyze and interpret data with bioinformatics software and

knowledge bases to provide relevant, actionable insights. Our automation systems tie these technologies together in

seamless and cost-effective molecular testing workflows - from Sample to Insight.

Net sales of $1.53 billion in 2019 consisted of consumable kits and other revenues (89% of sales) and automation

systems and instruments (11% of sales). Approximately 48% of net sales in 2019 were in Molecular Diagnostics, and

52% in Life Sciences customer classes in the Academia / Applied Testing and Pharma markets.

QIAGEN has grown by developing new instruments, consumables and digital solutions to meet diverse and growing

needs in the market, partnering with researchers and Pharma companies, and acquiring companies or technologies

to complement our portfolio. We believe the addressable global market for QIAGEN's portfolio of molecular testing

products for customers across the continuum of life science research and molecular diagnostics totals more than $10

billion.

We have funded our growth through internally generated funds, debt offerings, and private and public sales of
equity securities. QIAGEN’s global shares are listed on the New York Stock Exchange under the ticker symbol
Business and Operating Environment
M A N A G E M E N T   R E P O R T
QGEN and on the Frankfurt Prime Standard as QIA.

The company is registered under its commercial and legal name QIAGEN N.V. with the trade register (kamer van
koophandel) of the Dutch region Limburg Noord under file number 12036979. QIAGEN N.V. is a public limited
liability company (naamloze vennootschap) under Dutch law as a holding company. Our principal executive office is
located at Hulsterweg 82, 5912 PL Venlo, The Netherlands, and our telephone number is +31-77-355-6600.

As a holding company, QIAGEN conducts business through subsidiaries located throughout the world. Further
information about QIAGEN can be found at www.QIAGEN.com. By referring to our website, we do not incorporate
the website or any portion of the website by reference into this Annual Report.

On March 3, 2020, QIAGEN and Thermo Fisher Scientific Inc. (NYSE: TMO) announced that their boards of
directors, as well as the managing board of QIAGEN N.V., unanimously approved Thermo Fisher’s proposal to
acquire QIAGEN for €39 per share in cash. The offer price represents a premium of approximately 23% to the
closing price of QIAGEN’s common stock on the Frankfurt Prime Standard on March 2, 2020, the last trading day
prior to the announcement of the transaction. Thermo Fisher will commence a tender offer to acquire all of the
ordinary shares of QIAGEN. The transaction values QIAGEN at approximately $11.5 billion at current exchange
rates, which includes the assumption of approximately $1.4 billion of net debt. The transaction, which is expected to
be completed in the first half of 2021, is subject to the satisfaction of customary closing conditions, including the
receipt of applicable regulatory approvals, the adoption of certain resolutions relating to the transaction at an
Extraordinary General Meeting of QIAGEN’s shareholders, and completion of the tender offer.

Operating Environment in 2019

Global economic growth decelerated in 2019 amid weakness in global trade and investment, providing a
challenging business environment for QIAGEN operations. Real Gross Domestic Product (GDP) for the world grew an
estimated 2.4% in 2019, decelerating from 3.0% in 2018 and 3.2% in 2017, the World Bank reported. Advanced
economies including the United States, the Euro area and Japan delivered slower growth in 2019. Emerging markets
as a whole also decelerated, with slower growth in China, India and many developing countries. Growth in global
trade slowed in 2019 amid challenges including tariffs, geopolitical developments and weaker demand in Europe
and Asia, although trade tensions eased somewhat late in the year. Central banks including the U.S. Federal Reserve
and the European Central Bank reduced interest rates and took other actions in 2019 to ease monetary policy and
counter the slowdown in economic growth. The U.S. dollar strengthened against other currencies in 2018, with a
negative impact of about 2 percentage points on growth in QIAGEN sales reported in dollars.

As genomic knowledge expands exponentially, molecular testing continues to grow to meet needs for insights in
diagnostics, life science research, pharmaceutical R&D and public safety. Technologies for next-generation
sequencing (NGS) and polymerase chain reaction (PCR) continued to disseminate and evolve in 2019, making
molecular testing more accessible, faster and more efficient. Molecular diagnostics kept growing dynamically and
expanding into new areas of medicine – enabling clinicians to evaluate and monitor cancers, infectious diseases,
immune status, and prenatal or neonatal health. In 2019, 11 of the 44 new drugs approved by the FDA were
targeted with biomarker testing; in addition, 15 existing drugs gained new indications targeted with biomarker
testing. Reimbursement for precision medicine, however, remained a challenge. In Academia, spending on NGS and
other molecular technologies continued to grow despite perennial uncertainties about research funding. Pharma
industry spending on R&D also grew in 2019, with DNA and RNA tests providing critical insights for drug discovery
and clinical trials. The migration of genomic technologies from basic research into the mainstream remains a
powerful driver for long-term growth of the industry, increasing the need for scalable, user-friendly and efficient
workflows from beginning to end in molecular testing.

QIAGEN has recently achieved a number of milestones by continuing to focus on strategic growth initiatives:

›

QIAGEN’s QuantiFERON-TB tests play an increasingly central role in the global fight against tuberculosis (TB), a
contagious bacterial infection that strikes more than 10 million new patients and kills about 1.7 million annually.
Guidelines from the World Health Organization (WHO) and leading clinical organizations now recommend
screening of high-risk individuals for latent TB infection and preventive treatment as a component of TB control

25

programs.

grew 8% in 2019 to $240 million.

›

Sales of the QuantiFERON-TB franchise, including the fourth-generation QuantiFERON-TB Gold Plus (QFT-Plus),

Economic EnvironmentIndustry EnvironmentRecent DevelopmentsSustaining the rapid growth of our QuantiFERON-TB franchise:On March 3, 2020, QIAGEN and Thermo Fisher Scientific Inc. (NYSE: TMO) announced that their boards of

directors, as well as the managing board of QIAGEN N.V., unanimously approved Thermo Fisher’s proposal to

acquire QIAGEN for €39 per share in cash. The offer price represents a premium of approximately 23% to the

closing price of QIAGEN’s common stock on the Frankfurt Prime Standard on March 2, 2020, the last trading day

prior to the announcement of the transaction. Thermo Fisher will commence a tender offer to acquire all of the

ordinary shares of QIAGEN. The transaction values QIAGEN at approximately $11.5 billion at current exchange

rates, which includes the assumption of approximately $1.4 billion of net debt. The transaction, which is expected to

be completed in the first half of 2021, is subject to the satisfaction of customary closing conditions, including the

receipt of applicable regulatory approvals, the adoption of certain resolutions relating to the transaction at an

Extraordinary General Meeting of QIAGEN’s shareholders, and completion of the tender offer.

Operating Environment in 2019

Global economic growth decelerated in 2019 amid weakness in global trade and investment, providing a

challenging business environment for QIAGEN operations. Real Gross Domestic Product (GDP) for the world grew an

estimated 2.4% in 2019, decelerating from 3.0% in 2018 and 3.2% in 2017, the World Bank reported. Advanced

economies including the United States, the Euro area and Japan delivered slower growth in 2019. Emerging markets

as a whole also decelerated, with slower growth in China, India and many developing countries. Growth in global

trade slowed in 2019 amid challenges including tariffs, geopolitical developments and weaker demand in Europe

and Asia, although trade tensions eased somewhat late in the year. Central banks including the U.S. Federal Reserve

and the European Central Bank reduced interest rates and took other actions in 2019 to ease monetary policy and

counter the slowdown in economic growth. The U.S. dollar strengthened against other currencies in 2018, with a

negative impact of about 2 percentage points on growth in QIAGEN sales reported in dollars.

As genomic knowledge expands exponentially, molecular testing continues to grow to meet needs for insights in

diagnostics, life science research, pharmaceutical R&D and public safety. Technologies for next-generation

sequencing (NGS) and polymerase chain reaction (PCR) continued to disseminate and evolve in 2019, making

molecular testing more accessible, faster and more efficient. Molecular diagnostics kept growing dynamically and

expanding into new areas of medicine – enabling clinicians to evaluate and monitor cancers, infectious diseases,

immune status, and prenatal or neonatal health. In 2019, 11 of the 44 new drugs approved by the FDA were
targeted with biomarker testing; in addition, 15 existing drugs gained new indications targeted with biomarker
testing. Reimbursement for precision medicine, however, remained a challenge. In Academia, spending on NGS and
other molecular technologies continued to grow despite perennial uncertainties about research funding. Pharma
industry spending on R&D also grew in 2019, with DNA and RNA tests providing critical insights for drug discovery
and clinical trials. The migration of genomic technologies from basic research into the mainstream remains a
powerful driver for long-term growth of the industry, increasing the need for scalable, user-friendly and efficient
workflows from beginning to end in molecular testing.

QIAGEN has recently achieved a number of milestones by continuing to focus on strategic growth initiatives:

›

›

›

›

›

›

›

›

›

QIAGEN’s QuantiFERON-TB tests play an increasingly central role in the global fight against tuberculosis (TB), a
contagious bacterial infection that strikes more than 10 million new patients and kills about 1.7 million annually.
Guidelines from the World Health Organization (WHO) and leading clinical organizations now recommend
screening of high-risk individuals for latent TB infection and preventive treatment as a component of TB control
programs.

Sales of the QuantiFERON-TB franchise, including the fourth-generation QuantiFERON-TB Gold Plus (QFT-Plus),
grew 8% in 2019 to $240 million.

In November 2019 QIAGEN and DiaSorin announced the U.S. launch of the LIAISON QuantiFERON-TB Gold
Plus test as a streamlined, highly automated option for latent TB screening programs from small-scale to high-
throughput. QIAGEN and DiaSorin introduced QFT-Plus on LIAISON analyzers in Europe in late 2018, added the
U.S. market following the recent FDA approval, and are planning availability for China in 2020.

In October 2019 the Stop TB Partnership’s Global Drug Facility (GDF) added QFT-Plus to its diagnostic catalog,
opening a new channel to reach countries with a high incidence of TB but limited resources. The GDF helps match
global demand with funding from donors, governments and non-governmental organizations.

QIAGEN continues to innovate in latent tuberculosis testing. In partnership with Ellume, QIAGEN is developing
QuantiFERON-TB Access, a simplified, low-cost test offering ultrasensitive digital detection in a workflow designed
for cost-efficiency and use in areas lacking laboratory infrastructure. The product will further advance global TB
control efforts, particularly in low-resource and high-burden regions. Commercialization is expected to begin in
2020.

QIAGEN continues to expand our global presence in the fast-growing market for next-generation sequencing
(NGS). In 2019 we shifted our strategy and reoriented our NGS activities to focus on opportunities to build upon
our strengths as a leader in "universal" technologies for preparing samples, analyzing genomic variations and
interpreting sequencing data.

NGS-related sales in 2019 achieved QIAGEN’s goal of more than $180 million, compared to over $140 million
in 2018. Demand for our universal NGS technologies and Digital Insights from bioinformatics applications drove
this growth.

In October 2019 QIAGEN and Illumina, Inc. announced a 15-year partnership to broaden the use of NGS-based
in vitro diagnostic kits to deliver insights for clinical decision-making, including companion diagnostics for
precision medicine. Illumina and QIAGEN will cooperate to commercialize a menu of clinically validated
workflows that combine QIAGEN’s proprietary content and digital solutions for use with Illumina’s MiSeq Dx,
NextSeq 550Dx and future diagnostic systems. In the coming years we expect the partnership with Illumina, whose
sequencing instruments are in widespread use worldwide, to expand our global presence in clinical decision-
making using NGS technology.

QIAGEN also announced in October 2019 that we have discontinued development of new NGS instruments. We
will focus NGS-related development resources on maximizing the new Illumina partnership for NGS-based
diagnostic kits, as well as expanding our offering of universal NGS consumables for use with any sequencer.
QIAGEN intends to continue supporting and servicing customers of the GeneReader NGS System, which is
available as a complete system for the processing of smaller targeted gene panels, but we do not expect to
develop new sequencing platforms at this time.

›

26

We continue to expand QIAGEN’s broad portfolio of universal, or platform-agnostic, NGS solutions. Among the
new products introduced in 2019 are QIAseq Multimodal Panels, the industry’s only consolidated workflow to
simultaneously detect DNA variants, RNA fusions and gene expression levels from a single sample; QIAseq
FastSelect kits to remove unwanted RNA from samples, addressing critical bottlenecks in research into RNA and
gene expression; and the QIAseq Expanded Carrier Screening Panel, enabling identification of genetic drivers of

more than 200 rare and inherited diseases.

›

QIAGEN continues to lead our industry in precision medicine, collaborating with more than 25 pharmaceutical

and biotech companies to develop companion and complementary diagnostics to guide clinical decision-making.

These partnerships feed a deep pipeline of Sample to Insight tests supporting clinical trials and, with regulatory

approvals, patient care.

›

In 2019 three of our co-development partnerships bore fruit in newly approved companion diagnostics in

oncology. We introduced the therascreen PIK3CA RGQ PCR Kit in the U.S. as a companion diagnostic to aid in

identifying patients for a new breast cancer therapy developed by Novartis (launched in Europe in early 2020);

the therascreen FGFR RGQ RT-PCR Kit to help identify U.S. urothelial cancer patients for Janssen Biotech’s newly

approved FGFR kinase inhibitor; and the therascreen EGFR RGQ PCR Kit in Japan - our first companion diagnostic

Economic EnvironmentIndustry EnvironmentRecent DevelopmentsSustaining the rapid growth of our QuantiFERON-TB franchise:Driving growth in next-generation sequencing (NGS) with greater focus:Reaping the value of genomic insights for Precision Medicine:›

In November 2019 QIAGEN and DiaSorin announced the U.S. launch of the LIAISON QuantiFERON-TB Gold

Plus test as a streamlined, highly automated option for latent TB screening programs from small-scale to high-

throughput. QIAGEN and DiaSorin introduced QFT-Plus on LIAISON analyzers in Europe in late 2018, added the

U.S. market following the recent FDA approval, and are planning availability for China in 2020.

›

In October 2019 the Stop TB Partnership’s Global Drug Facility (GDF) added QFT-Plus to its diagnostic catalog,

opening a new channel to reach countries with a high incidence of TB but limited resources. The GDF helps match

global demand with funding from donors, governments and non-governmental organizations.

›

QIAGEN continues to innovate in latent tuberculosis testing. In partnership with Ellume, QIAGEN is developing

QuantiFERON-TB Access, a simplified, low-cost test offering ultrasensitive digital detection in a workflow designed

for cost-efficiency and use in areas lacking laboratory infrastructure. The product will further advance global TB

control efforts, particularly in low-resource and high-burden regions. Commercialization is expected to begin in

2020.

›

QIAGEN continues to expand our global presence in the fast-growing market for next-generation sequencing

(NGS). In 2019 we shifted our strategy and reoriented our NGS activities to focus on opportunities to build upon

our strengths as a leader in "universal" technologies for preparing samples, analyzing genomic variations and

interpreting sequencing data.

›

NGS-related sales in 2019 achieved QIAGEN’s goal of more than $180 million, compared to over $140 million

in 2018. Demand for our universal NGS technologies and Digital Insights from bioinformatics applications drove

this growth.

›

In October 2019 QIAGEN and Illumina, Inc. announced a 15-year partnership to broaden the use of NGS-based

in vitro diagnostic kits to deliver insights for clinical decision-making, including companion diagnostics for

precision medicine. Illumina and QIAGEN will cooperate to commercialize a menu of clinically validated

workflows that combine QIAGEN’s proprietary content and digital solutions for use with Illumina’s MiSeq Dx,

NextSeq 550Dx and future diagnostic systems. In the coming years we expect the partnership with Illumina, whose
sequencing instruments are in widespread use worldwide, to expand our global presence in clinical decision-
making using NGS technology.

M A N A G E M E N T   R E P O R T

Business and Operating Environment

›

›

›

›

›

›

›

›

›

›

QIAGEN also announced in October 2019 that we have discontinued development of new NGS instruments. We
will focus NGS-related development resources on maximizing the new Illumina partnership for NGS-based
diagnostic kits, as well as expanding our offering of universal NGS consumables for use with any sequencer.
QIAGEN intends to continue supporting and servicing customers of the GeneReader NGS System, which is
available as a complete system for the processing of smaller targeted gene panels, but we do not expect to
develop new sequencing platforms at this time.

We continue to expand QIAGEN’s broad portfolio of universal, or platform-agnostic, NGS solutions. Among the
new products introduced in 2019 are QIAseq Multimodal Panels, the industry’s only consolidated workflow to
simultaneously detect DNA variants, RNA fusions and gene expression levels from a single sample; QIAseq
FastSelect kits to remove unwanted RNA from samples, addressing critical bottlenecks in research into RNA and
gene expression; and the QIAseq Expanded Carrier Screening Panel, enabling identification of genetic drivers of
more than 200 rare and inherited diseases.

QIAGEN continues to lead our industry in precision medicine, collaborating with more than 25 pharmaceutical
and biotech companies to develop companion and complementary diagnostics to guide clinical decision-making.
These partnerships feed a deep pipeline of Sample to Insight tests supporting clinical trials and, with regulatory
approvals, patient care.

In 2019 three of our co-development partnerships bore fruit in newly approved companion diagnostics in
oncology. We introduced the therascreen PIK3CA RGQ PCR Kit in the U.S. as a companion diagnostic to aid in
identifying patients for a new breast cancer therapy developed by Novartis (launched in Europe in early 2020);
the therascreen FGFR RGQ RT-PCR Kit to help identify U.S. urothelial cancer patients for Janssen Biotech’s newly
approved FGFR kinase inhibitor; and the therascreen EGFR RGQ PCR Kit in Japan - our first companion diagnostic
approval there - to help guide the use of a new Pfizer therapy in non-small cell lung cancer (NSCLC). All three run
on the Rotor-Gene Q, a module in our QIAsymphony system.

A partnership with Inovio Pharmaceuticals, launched in May 2019, will co-develop a liquid-biopsy companion
diagnostic for Inovio’s DNA-based immunotherapy compound, which has potential to be the first treatment for
human papillomavirus (HPV) infection of the cervix and first non-surgical treatment for precancerous lesions
associated with the virus.

A new collaboration with Amgen announced in early 2020 will develop tissue-based companion diagnostics to
identify non-small cell lung cancer patients who would benefit from Amgen's investigational cancer treatment AMG
510. The test will identify patients with cancers that have the KRAS G12C genetic mutation, a common cause of
cancer.

We expanded our Day-One Lab Readiness network in 2019 through collaborations with CLIA-certified
laboratories to ensure immediate patient access to QIAGEN companion diagnostics upon approval of new
oncology drugs. Among the clinical labs now participating to accelerate patient access are LabCorp, Quest,
NeoGenomics, SRL in Japan, and others.

QIAGEN has strategically expanded our offering of automation solutions to enter growing segments of the life
science and molecular diagnostics markets, as well as to meet the diverse, rapidly evolving needs of customers.

The QIAsymphony system, a cost-effective modular automation solution that integrates PCR molecular testing from
sample processing to final insights, surpassed our goal of 2,500 cumulative placements by year-end 2019.
Related consumables grew globally, including an extensive menu of in vitro diagnostic tests in infectious disease,
oncology and transplant care. The sample processing module, QIAsymphony SP, is a market-leading "front end"
solution for reliable automated handling of samples, including liquid biopsies, for PCR and next-generation
sequencing.

The QIAstat-Dx system is approaching 1,000 cumulative placements, providing fast, cost-effective and easy-to-use
syndromic testing with novel Sample to Insight solutions. In May 2019, we launched the platform in the United
States with an FDA-cleared multiplex panel for differential diagnosis of respiratory infections. QIAstat-Dx was
introduced in Europe in 2018 with CE-IVD marked panels for respiratory and gastrointestinal infections. The system
produced $15 million of sales in 2019. In early 2020, QIAGEN created a version of the QIAstat-Dx respiratory
panel for potential use in testing of patients for COVID-19 in China and other markets using the QIAstat-Dx
platform. Additional diagnostic panels are planned to launch in 2020 to enhance the value to clinics and
physician offices.

27

›

The NeuMoDx 96 and 288 Molecular Systems are providing fully integrated, mid- to high-throughput PCR analysis
systems for clinical laboratories, and now have eight CE-IVD cleared diagnostic kits covering a range of infectious

diseases. QIAGEN has the right to commercialize these platforms in Europe and other markets outside the U.S.

›

Our development of disruptive new systems for digital PCR is on track to begin commercialization in 2020,

combining proprietary QIAGEN technologies with assets acquired from Formulatrix in early 2019. Our digital

PCR initiative aims to provide fully-integrated solutions that simplify workflows for laboratories, offer higher

throughput and multiplexing, and provide customers with favorable costs for instruments and consumables.

›

As genomic data increasingly influences decisions in science and healthcare, QIAGEN’s Digital Insights solutions

are driving growth with content-enabled bioinformatics that transform raw NGS data into actionable insights for

customers.

›

Researchers worldwide use our software and industry-leading knowledge bases to accelerate innovation, guide

experiments and translate genomic results into actions that enhance clinical care. Starting in 2014, QIAGEN has

built a comprehensive, easy-to-use toolbox through acquisitions of Ingenuity, CLC bio, BIOBASE and OmicSoft.

Digital Insights solutions are marketed as standalone products and integrated into QIAGEN Sample to Insight

workflows to meet customer needs.

Driving growth in next-generation sequencing (NGS) with greater focus:Reaping the value of genomic insights for Precision Medicine:Expanding QIAGEN automation solutions to serve growing market needs:Digital Insights solutions transforming raw data into valuable insights:approval there - to help guide the use of a new Pfizer therapy in non-small cell lung cancer (NSCLC). All three run

on the Rotor-Gene Q, a module in our QIAsymphony system.

›

A partnership with Inovio Pharmaceuticals, launched in May 2019, will co-develop a liquid-biopsy companion

diagnostic for Inovio’s DNA-based immunotherapy compound, which has potential to be the first treatment for

human papillomavirus (HPV) infection of the cervix and first non-surgical treatment for precancerous lesions

associated with the virus.

›

A new collaboration with Amgen announced in early 2020 will develop tissue-based companion diagnostics to

identify non-small cell lung cancer patients who would benefit from Amgen's investigational cancer treatment AMG

510. The test will identify patients with cancers that have the KRAS G12C genetic mutation, a common cause of

cancer.

›

We expanded our Day-One Lab Readiness network in 2019 through collaborations with CLIA-certified

laboratories to ensure immediate patient access to QIAGEN companion diagnostics upon approval of new

oncology drugs. Among the clinical labs now participating to accelerate patient access are LabCorp, Quest,

NeoGenomics, SRL in Japan, and others.

›

›

›

›

›

›

›

›

›

›

›

QIAGEN has strategically expanded our offering of automation solutions to enter growing segments of the life
science and molecular diagnostics markets, as well as to meet the diverse, rapidly evolving needs of customers.

The QIAsymphony system, a cost-effective modular automation solution that integrates PCR molecular testing from
sample processing to final insights, surpassed our goal of 2,500 cumulative placements by year-end 2019.
Related consumables grew globally, including an extensive menu of in vitro diagnostic tests in infectious disease,
oncology and transplant care. The sample processing module, QIAsymphony SP, is a market-leading "front end"
solution for reliable automated handling of samples, including liquid biopsies, for PCR and next-generation
sequencing.

The QIAstat-Dx system is approaching 1,000 cumulative placements, providing fast, cost-effective and easy-to-use
syndromic testing with novel Sample to Insight solutions. In May 2019, we launched the platform in the United
States with an FDA-cleared multiplex panel for differential diagnosis of respiratory infections. QIAstat-Dx was
introduced in Europe in 2018 with CE-IVD marked panels for respiratory and gastrointestinal infections. The system
produced $15 million of sales in 2019. In early 2020, QIAGEN created a version of the QIAstat-Dx respiratory
panel for potential use in testing of patients for COVID-19 in China and other markets using the QIAstat-Dx
platform. Additional diagnostic panels are planned to launch in 2020 to enhance the value to clinics and
physician offices.

The NeuMoDx 96 and 288 Molecular Systems are providing fully integrated, mid- to high-throughput PCR analysis
systems for clinical laboratories, and now have eight CE-IVD cleared diagnostic kits covering a range of infectious
diseases. QIAGEN has the right to commercialize these platforms in Europe and other markets outside the U.S.

Our development of disruptive new systems for digital PCR is on track to begin commercialization in 2020,
combining proprietary QIAGEN technologies with assets acquired from Formulatrix in early 2019. Our digital
PCR initiative aims to provide fully-integrated solutions that simplify workflows for laboratories, offer higher
throughput and multiplexing, and provide customers with favorable costs for instruments and consumables.

As genomic data increasingly influences decisions in science and healthcare, QIAGEN’s Digital Insights solutions
are driving growth with content-enabled bioinformatics that transform raw NGS data into actionable insights for
customers.

Researchers worldwide use our software and industry-leading knowledge bases to accelerate innovation, guide
experiments and translate genomic results into actions that enhance clinical care. Starting in 2014, QIAGEN has
built a comprehensive, easy-to-use toolbox through acquisitions of Ingenuity, CLC bio, BIOBASE and OmicSoft.
Digital Insights solutions are marketed as standalone products and integrated into QIAGEN Sample to Insight
workflows to meet customer needs.

In June 2019, our industry-leading QIAGEN Clinical Insight (QCI), a clinical decision support platform for
interpretation and reporting of next-generation sequencing data, achieved a milestone of more than 1 million
patient test cases analyzed and interpreted. We continually update and expand the content available through
QCI. After acquiring N-of-One, Inc. in January 2019, we integrated N-of-One’s services and somatic cancer
database, including medical interpretation and real-world evidence from more than 125,000 anonymized patient
samples, into QIAGEN Clinical Insight.

As a leader in sample technologies enabling laboratories to obtain highest-quality DNA and RNA for molecular
testing, QIAGEN continues to innovate with front-end solutions in growing fields. QIAGEN technologies process
an estimated 50,000 biological samples a day. In 2019 we rolled out several new products solving tough
challenges for customers, such as new tools to accelerate RNA sequencing for research and liquid biopsies for
efficient, less-invasive diagnosis.

Our QIAcube Connect system, launched in January 2019 to amplify the benefits of automated sample processing
for customers, reached more than 660 placements by year-end, with strong Life Sciences demand. Building on
over 8,000 placements of our first-generation QIAcube instrument, QIAcube Connect delivers a new level of
digitization and ease of use with thousands of protocols, assuring full standardization and freeing customers from
repetitive manual processing.

QIAGEN offers an innovative portfolio of liquid biopsy technologies for research and clinical applications. Liquid
biopsies extract and purify DNA and RNA from blood or other body fluids, as an alternative to costly and
sometimes impractical tissue biopsies. In 2019, our therascreen PIK3CA RGQ PCR Kit became the first FDA-
approved liquid biopsy test using blood plasma to guide treatment decisions in breast cancer.

›

28

In October 2019, we launched innovative new QIAseq FastSelect kits for customers in Life Sciences to remove
unwanted RNA from biological samples for faster, simpler library preparation. The solutions address critical
bottlenecks in RNA sequencing, enabling scientists to achieve more on-target NGS reads and more efficient use of
resources.

›

QIAGEN implemented several organizational changes and portfolio initiatives in 2019 with the aim of driving

future growth, efficiency and profitability. These actions prioritized resource allocation to streamline operations,

strengthen the focus on execution and improve operating margins.

›

In October 2019, QIAGEN stopped internal development of new instruments for next-generation sequencing,

restructuring to allocate resources from work on new proprietary NGS systems to QIAGEN's partnership with

Illumina to commercialize in vitro diagnostic kits running on Illumina’s clinical NGS platforms, as well as to

universal NGS portfolio.

›

Streamlining initiatives in 2019 aimed to create a more focused, agile and efficient global operation. Changes

included shifting worldwide production into a regional structure, integrating global sales resources into the three

Business Areas (Life Sciences, Molecular Diagnostics and QIAGEN Digital Insights), and moving additional

activities to QIAGEN Business Services centers in Poland and the Philippines.

›

Digitization of a wide range of customer interactions continues to progress, with approximately 43% of 2019

sales coming via the QIAGEN website and other online channels.

Products

interpretation.

QIAGEN's leadership in Sample to Insight solutions for molecular testing leverages our product portfolio across a

wide range of applications and customer classes. We provide more than 500 core consumable products (sample

and assay kits), instruments and automation systems, and digital insight solutions (or bioinformatics) for analysis and

These diverse revenue streams comprise two main categories: 

, approximately

89% of net sales in 2019, including sample and assay kits, digital insights, royalties, co-development milestone

Expanding QIAGEN automation solutions to serve growing market needs:Digital Insights solutions transforming raw data into valuable insights:Pioneering differentiated sample technologies and liquid biopsy solutions:Executing initiatives to prioritize resource allocation and create value:Consumables and related revenueslfd›

In June 2019, our industry-leading QIAGEN Clinical Insight (QCI), a clinical decision support platform for

interpretation and reporting of next-generation sequencing data, achieved a milestone of more than 1 million

patient test cases analyzed and interpreted. We continually update and expand the content available through

QCI. After acquiring N-of-One, Inc. in January 2019, we integrated N-of-One’s services and somatic cancer

database, including medical interpretation and real-world evidence from more than 125,000 anonymized patient

samples, into QIAGEN Clinical Insight.

›

As a leader in sample technologies enabling laboratories to obtain highest-quality DNA and RNA for molecular

testing, QIAGEN continues to innovate with front-end solutions in growing fields. QIAGEN technologies process
an estimated 50,000 biological samples a day. In 2019 we rolled out several new products solving tough
challenges for customers, such as new tools to accelerate RNA sequencing for research and liquid biopsies for
efficient, less-invasive diagnosis.

Business and Operating Environment

M A N A G E M E N T   R E P O R T

›

›

›

›

›

›

Our QIAcube Connect system, launched in January 2019 to amplify the benefits of automated sample processing
for customers, reached more than 660 placements by year-end, with strong Life Sciences demand. Building on
over 8,000 placements of our first-generation QIAcube instrument, QIAcube Connect delivers a new level of
digitization and ease of use with thousands of protocols, assuring full standardization and freeing customers from
repetitive manual processing.

QIAGEN offers an innovative portfolio of liquid biopsy technologies for research and clinical applications. Liquid
biopsies extract and purify DNA and RNA from blood or other body fluids, as an alternative to costly and
sometimes impractical tissue biopsies. In 2019, our therascreen PIK3CA RGQ PCR Kit became the first FDA-
approved liquid biopsy test using blood plasma to guide treatment decisions in breast cancer.

In October 2019, we launched innovative new QIAseq FastSelect kits for customers in Life Sciences to remove
unwanted RNA from biological samples for faster, simpler library preparation. The solutions address critical
bottlenecks in RNA sequencing, enabling scientists to achieve more on-target NGS reads and more efficient use of
resources.

QIAGEN implemented several organizational changes and portfolio initiatives in 2019 with the aim of driving
future growth, efficiency and profitability. These actions prioritized resource allocation to streamline operations,
strengthen the focus on execution and improve operating margins.

In October 2019, QIAGEN stopped internal development of new instruments for next-generation sequencing,
restructuring to allocate resources from work on new proprietary NGS systems to QIAGEN's partnership with
Illumina to commercialize in vitro diagnostic kits running on Illumina’s clinical NGS platforms, as well as to
universal NGS portfolio.

Streamlining initiatives in 2019 aimed to create a more focused, agile and efficient global operation. Changes
included shifting worldwide production into a regional structure, integrating global sales resources into the three
Business Areas (Life Sciences, Molecular Diagnostics and QIAGEN Digital Insights), and moving additional
activities to QIAGEN Business Services centers in Poland and the Philippines.

›

Digitization of a wide range of customer interactions continues to progress, with approximately 43% of 2019
sales coming via the QIAGEN website and other online channels.

Products

QIAGEN's leadership in Sample to Insight solutions for molecular testing leverages our product portfolio across a
wide range of applications and customer classes. We provide more than 500 core consumable products (sample
and assay kits), instruments and automation systems, and digital insight solutions (or bioinformatics) for analysis and
interpretation.

These diverse revenue streams comprise two main categories: 
89% of net sales in 2019, including sample and assay kits, digital insights, royalties, co-development milestone
payments and services; and 
, approximately 11% of net sales in 2019,
including related services and contracts.

, approximately

QIAGEN automation systems streamline molecular testing using consumables in efficient workflows and carrying
customers through the process from Sample to Insight. Some QIAGEN consumables are designed to run on QIAGEN
instruments, while others are universal kits designed for use with any molecular testing platform.

Our broad portfolio of sample technologies isolate and process DNA, RNA and proteins from blood, tissue and
other biological materials to prepare for a wide variety of molecular testing needs in research and clinical
applications.

Primary sample technology consumables

29

• Nucleic stabilization and purification kits designed for primary

• QIAamp

• DNeasy

• RNeasy

sample materials (DNA, RNA, proteins), manual and automated

processing for genotyping, gene expression, viral and bacterial

analysis

• PAXgene

• AdnaTest

• Tiangen

• Mainly based on silica membranes and buffers

• Gentra Puregene

• Oligotex

• AllPrep

• BioSprint

• Kits and components for purification of nucleic acids and proteins

• QIAprep

• QIAquick

• DyeEx

from secondary sample materials (e.g. gel, plasmid DNA, proteins)

Secondary sample technology consumables

• Molecular biology reagents

• Qproteome

• BioMag

• Ni-NTA

• QIAGEN Plasmid Plus

• QIAfilter

• R.E.A.L.

• HiSpeed

• EndoFree

Sample technology instruments

• Instruments for nucleic acid purification and accessories

• QIAsymphony SP

• QIAcube Connect

• QIAcube HT

• QIAscout

• Centrifuges

• TissueLyser

Targeted or multiplex assay technologies deploy a variety of methods to amplify biomolecules and make them visible

and ready for molecular analysis using different techniques.

Pioneering differentiated sample technologies and liquid biopsy solutions:Executing initiatives to prioritize resource allocation and create value:Consumables and related revenueslfdAutomation platforms and instrumentsMajor types of QIAGEN solutions and related brandsSample TechnologiesAssay TechnologiesSample TechnologiesSelected QIAGEN brandspayments and services; and 
including related services and contracts.

, approximately 11% of net sales in 2019,

QIAGEN automation systems streamline molecular testing using consumables in efficient workflows and carrying
customers through the process from Sample to Insight. Some QIAGEN consumables are designed to run on QIAGEN
instruments, while others are universal kits designed for use with any molecular testing platform.

Our broad portfolio of sample technologies isolate and process DNA, RNA and proteins from blood, tissue and
other biological materials to prepare for a wide variety of molecular testing needs in research and clinical
applications.

Primary sample technology consumables

• Nucleic stabilization and purification kits designed for primary
sample materials (DNA, RNA, proteins), manual and automated
processing for genotyping, gene expression, viral and bacterial
analysis

• QIAamp

• DNeasy

• RNeasy

• PAXgene

• AdnaTest

• Tiangen

• Mainly based on silica membranes and buffers

• Gentra Puregene

• Oligotex

• AllPrep

• BioSprint

Secondary sample technology consumables

• Kits and components for purification of nucleic acids and proteins
from secondary sample materials (e.g. gel, plasmid DNA, proteins)

• QIAprep

• QIAquick

• DyeEx

• Molecular biology reagents

Sample technology instruments

• Qproteome

• BioMag

• Ni-NTA

• QIAGEN Plasmid Plus

• QIAfilter

• R.E.A.L.

• HiSpeed

• EndoFree

• Instruments for nucleic acid purification and accessories

• QIAsymphony SP

• QIAcube Connect

• QIAcube HT

• QIAscout

• Centrifuges

• TissueLyser

Targeted or multiplex assay technologies deploy a variety of methods to amplify biomolecules and make them visible
and ready for molecular analysis using different techniques.

30

Automation platforms and instrumentsMajor types of QIAGEN solutions and related brandsSample TechnologiesAssay TechnologiesSample TechnologiesSelected QIAGEN brandspayments and services; and 

including related services and contracts.

, approximately 11% of net sales in 2019,

QIAGEN automation systems streamline molecular testing using consumables in efficient workflows and carrying

customers through the process from Sample to Insight. Some QIAGEN consumables are designed to run on QIAGEN

instruments, while others are universal kits designed for use with any molecular testing platform.

Our broad portfolio of sample technologies isolate and process DNA, RNA and proteins from blood, tissue and

other biological materials to prepare for a wide variety of molecular testing needs in research and clinical

applications.

Primary sample technology consumables

• Nucleic stabilization and purification kits designed for primary

• QIAamp

• DNeasy

• RNeasy

sample materials (DNA, RNA, proteins), manual and automated

processing for genotyping, gene expression, viral and bacterial

analysis

• PAXgene

• AdnaTest

• Tiangen

• Mainly based on silica membranes and buffers

• Gentra Puregene

• Oligotex

• AllPrep

• BioSprint

• Kits and components for purification of nucleic acids and proteins

• QIAprep

• QIAquick

• DyeEx

from secondary sample materials (e.g. gel, plasmid DNA, proteins)

Secondary sample technology consumables

• Molecular biology reagents

• Qproteome

• BioMag

• Ni-NTA

• QIAGEN Plasmid Plus

• QIAfilter

• R.E.A.L.

• HiSpeed

• EndoFree

M A N A G E M E N T   R E P O R T

Business and Operating Environment

Sample technology instruments

• Instruments for nucleic acid purification and accessories

• QIAsymphony SP

• QIAcube Connect

• QIAcube HT

• QIAscout

• Centrifuges

• TissueLyser

Targeted or multiplex assay technologies deploy a variety of methods to amplify biomolecules and make them visible
and ready for molecular analysis using different techniques.

Assay content consumables

• Kits, assays, reagents and controls for identification and analysis of
sequence-specific targets (such as DNA, methylated DNA, bacterial
DNA, RNA, miRNA) with different technologies (such as PCR,
Pyrosequencing, hybridization) in assay and array format

• EpiTect

• ADNATest

• miCURY

• GapmeR

• qBiomarker

• RT2

• Oligonucleotide synthesis, siRNAs, bisulfite conversion

• miScript

• AllStars

• FlexiTube/FlexiPlate

Enzymatics consumables

• Custom-developed and configured enzymes and products which are
sold to OEM customers

• EnzScript

• Phoenix Hot Start

• VeraSeq

• ZipScript

Assay foundation consumables

• Different generations of PCR, qPCR, reverse transcription and
combinations (RT-PCR) kits for analysis of gene expression, genotyping
and gene regulation, running on QIAGEN or third-party instruments
and technologies

• QuantiTect

• QuantiFast

• QuantiNova

• OneStep RT-PCR

• Rotor-Gene

• HotStarTaq

• Similar product portfolio developed and sold through QIAGEN
second brands (Quanta, Tiangen)

• Type-it

• QIAGEN Multiplex

• TopTaq

• QIAxpert consumables, cloning kits and transfection reagents

• OmniScript

• SuperScript

• HiPerFect

• PolyFect

• SuperFect

Assay instruments

• Modular PCR system with Sample to Insight laboratory automation

• QIAsymphony RGQ

• QIAsymphony AS

• Rotor-Gene-Q

• One-step molecular analysis of hard-to-diagnose syndromes

• QIAstat-Dx

• NeuMoDx 96

• NeuMoDx 288

• Fully integrated medium- to high-throughput PCR test analysis

• PyroMark

• QIAxpert

• QIAxcel

• Specialized instruments for assay setup and analysis

• QIAgility

Custom laboratory and genomic services

• Custom services such as DNA sequencing, qPCR service, whole
genome amplification, and non-cGMP DNA production

• Provided on an individualized contract basis

High-throughput or next-generation sequencing (NGS) enables analysis of multiple sequences in parallel, using
massive analytical and computing power to generate date for a profile of a whole genome or portion of a genome.

31

Next-Generation Sequencing (NGS)Assay TechnologiesSelected QIAGEN brandsAutomation platforms and instrumentsMajor types of QIAGEN solutions and related brandsSample TechnologiesAssay TechnologiesSample TechnologiesSelected QIAGEN brandsAssay content consumables

• Kits, assays, reagents and controls for identification and analysis of

• EpiTect

• ADNATest

• miCURY

sequence-specific targets (such as DNA, methylated DNA, bacterial

DNA, RNA, miRNA) with different technologies (such as PCR,

Pyrosequencing, hybridization) in assay and array format

• GapmeR

• qBiomarker

• RT2

• Oligonucleotide synthesis, siRNAs, bisulfite conversion

• miScript

• AllStars

• FlexiTube/FlexiPlate

• Custom-developed and configured enzymes and products which are

• EnzScript

• Phoenix Hot Start

• VeraSeq

• ZipScript

Enzymatics consumables

sold to OEM customers

Assay foundation consumables

• Different generations of PCR, qPCR, reverse transcription and

• QuantiTect

• QuantiFast

• QuantiNova

combinations (RT-PCR) kits for analysis of gene expression, genotyping

and gene regulation, running on QIAGEN or third-party instruments

and technologies

• OneStep RT-PCR

• Rotor-Gene

• HotStarTaq

• Similar product portfolio developed and sold through QIAGEN

• Type-it

• QIAGEN Multiplex

• TopTaq

second brands (Quanta, Tiangen)

• QIAxpert consumables, cloning kits and transfection reagents

• OmniScript

• SuperScript

• HiPerFect

• PolyFect

• SuperFect

Assay instruments

• Modular PCR system with Sample to Insight laboratory automation

• QIAsymphony RGQ

• QIAsymphony AS

• Rotor-Gene-Q

• One-step molecular analysis of hard-to-diagnose syndromes

• QIAstat-Dx

• NeuMoDx 96

• NeuMoDx 288

• Fully integrated medium- to high-throughput PCR test analysis

• PyroMark

• QIAxpert

• QIAxcel

• Specialized instruments for assay setup and analysis

• QIAgility

Custom laboratory and genomic services

• Custom services such as DNA sequencing, qPCR service, whole
genome amplification, and non-cGMP DNA production

• Provided on an individualized contract basis

High-throughput or next-generation sequencing (NGS) enables analysis of multiple sequences in parallel, using
massive analytical and computing power to generate date for a profile of a whole genome or portion of a genome.

Universal NGS consumables

• Predefined and custom NGS gene panels (DNA, RNA), library prep
kits and components, whole genome amplification, etc.

• QIAseq

• REPLI-g

• GeneRead

Digital Insights solutions

• Bioinformatics solutions to deliver actionable insights from NGS
data, sold as freestanding software or cloud-based solutions, also
integrated into many QIAGEN consumables and instruments

• QIAGEN Clinical Insight

• CLC Genomics Workbench

• OmicSoft

• N-of-One

• QIAGEN Knowledge Base

• HGMD

• Ingenuity Variant Analysis

• Ingenuity Pathway Analysis

Genetic analysis used for forensics and human identification can positively identify or rule out identification of
individuals or biological substances for purposes such as law enforcement investigation, paternity testing or food
safety screening.

Human ID / Forensics sample collection consumables

• Sample cards and collection swabs

• FTA

• Other consumables

Human ID / Forensics consumables

• STR assays for Human ID, additional assays for food contamination

• Investigator (human ID / forensics)

• mericon (food safety)

Customers

With a growing portfolio of innovative products for molecular testing, QIAGEN has built customer relationships
across the entire value chain of Life Sciences and Molecular Diagnostics. Discoveries often surface in universities and
research institutes, then are licensed for development by pharmaceutical and biotech companies, and finally move
into widespread commercial use in healthcare and other areas of life. We organize our business to serve the needs
of major customer classes:

›

›

Molecular Diagnostics - healthcare providers engaged in patient care including hospitals, public health
organizations, reference laboratories and physician practices

Life Sciences - researchers in universities, research institutes and industry customers using molecular testing to
achieve new insights into disease or other biological processes, as well as applying molecular testing in non-
healthcare fields

›

Academia / Applied Testing - exploring the secrets of life such as disease mechanisms and pathways,
translating findings into drug targets or other products, or serving purposes such as forensics and human
identification

32

›

Pharma - pharmaceutical and biotechnology companies engaging in the R&D process from drug discovery to
translational medicine and then clinical development

QIAGEN offers one of the broadest portfolios of molecular technologies for healthcare, and Molecular Diagnostics

customers accounted for $737 million of our sales in 2019. The success of molecular testing in healthcare depends

Forensics and Human IdentificationMolecular DiagnosticsNext-Generation Sequencing (NGS)Selected QIAGEN brandsForensics and Human IdentificationSelected QIAGEN brandsNext-Generation Sequencing (NGS)Assay TechnologiesSelected QIAGEN brands• Predefined and custom NGS gene panels (DNA, RNA), library prep

• QIAseq

• REPLI-g

• GeneRead

kits and components, whole genome amplification, etc.

Universal NGS consumables

Digital Insights solutions

• Bioinformatics solutions to deliver actionable insights from NGS

• QIAGEN Clinical Insight

• CLC Genomics Workbench

• OmicSoft

data, sold as freestanding software or cloud-based solutions, also

integrated into many QIAGEN consumables and instruments

• N-of-One

• QIAGEN Knowledge Base

• HGMD

• Ingenuity Variant Analysis

• Ingenuity Pathway Analysis

Genetic analysis used for forensics and human identification can positively identify or rule out identification of

individuals or biological substances for purposes such as law enforcement investigation, paternity testing or food

safety screening.

Human ID / Forensics sample collection consumables

• Sample cards and collection swabs

• FTA

• Other consumables

• STR assays for Human ID, additional assays for food contamination

• Investigator (human ID / forensics)

• mericon (food safety)

Human ID / Forensics consumables

Customers

With a growing portfolio of innovative products for molecular testing, QIAGEN has built customer relationships
across the entire value chain of Life Sciences and Molecular Diagnostics. Discoveries often surface in universities and
M A N A G E M E N T   R E P O R T
research institutes, then are licensed for development by pharmaceutical and biotech companies, and finally move
into widespread commercial use in healthcare and other areas of life. We organize our business to serve the needs
of major customer classes:

Business and Operating Environment

›

›

Molecular Diagnostics - healthcare providers engaged in patient care including hospitals, public health
organizations, reference laboratories and physician practices

Life Sciences - researchers in universities, research institutes and industry customers using molecular testing to
achieve new insights into disease or other biological processes, as well as applying molecular testing in non-
healthcare fields

›

Academia / Applied Testing - exploring the secrets of life such as disease mechanisms and pathways,
translating findings into drug targets or other products, or serving purposes such as forensics and human
identification

›

Pharma - pharmaceutical and biotechnology companies engaging in the R&D process from drug discovery to
translational medicine and then clinical development

QIAGEN offers one of the broadest portfolios of molecular technologies for healthcare, and Molecular Diagnostics
customers accounted for $737 million of our sales in 2019. The success of molecular testing in healthcare depends
on the ability to accurately analyze purified nucleic acid samples from sources such as blood, tissue, body fluids and
stool. Automated systems must process tests reliably and efficiently, often handling hundreds of samples concurrently.
The range of assays for diseases and biomarkers, convenience and ease of laboratory workflow, and
standardization of lab procedures also influence success.

The molecular diagnostics market generates total sales estimated by industry experts at approximately $7 billion in
2019, including about $5 billion potentially addressable with QIAGEN's product portfolio. Molecular testing is the
most dynamic segment of the global in vitro diagnostics market, growing at an estimated annual rate in the mid-
single-digits at constant exchange rates. Given the advantages of precise genetic information over traditional tests,
QIAGEN expects the healthcare market to continue to provide significant growth opportunities.

In QIAGEN’s Molecular Diagnostics business we focus on three priorities for fighting disease:

›

 - accurately diagnosing cancer, enabling prevention or early detection, as well as guiding selection of

therapies with individualized molecular insights for precision medicine.

QIAGEN's oncology test portfolio includes a broad range of technologies and biomarkers for Precision Medicine,
including regulator-approved companion diagnostics for oncogenes such as KRAS, EGFR BRCA1/2, JAK2,
PIK3CA and others, as well as comprehensive gene panels for research applications in next-generation
sequencing. We also provide industry-leading tests to screen for human papillomavirus (HPV) and protect women
from cervical cancer.

We have a deep pipeline of oncology tests for PCR and NGS analysis under development. In addition to our
portfolio of molecular technologies and automation systems, QIAGEN offers Pharma partners a full infrastructure
for co-development programs, intellectual property on platforms and content, regulatory experience, global
marketing reach, and independence as a company focusing exclusively on these types of technologies.

›

 - using advanced tests to detect immune-system markers as a preventive strategy, such as

screening patients for latent tuberculosis infection to guard against active TB disease, or to monitor immune
function, for example in transplant patients. Our sensitive QuantiFERON technology accurately detects infection
and measures immune response.

Our lead products in this field, QuantiFERON-TB Gold Plus and QuantiFERON-TB Gold, are used in tuberculosis
control efforts worldwide to detect latent TB infection (LTBI) by screening vulnerable populations, including close
contacts of patients with active TB disease, immunocompromised persons or patients on immunosuppressive drugs.
Individuals with LTBI can then be treated, preventing the infection from becoming active and contagious. As
modern blood tests analyzed in a laboratory, the QuantiFERON-TB assays are faster, less labor-intensive and more
accurate than the century-old tuberculin skin test. The potential global market for latent TB infection testing is
estimated at up to $1 billion.

33

In transplantation, our QuantiFERON Monitor provides monitoring of immune function in solid organ transplant

patients and QuantiFERON-CMV Kit tests immunity for infection with cytomegalovirus (CMV) in at-risk patients.

›

 - detecting and differentiating viral and bacterial infections - such as HIV, hepatitis, influenza,

sexually transmitted diseases and healthcare-associated infections, as well as respiratory and gastrointestinal

syndromes - can be useful in guiding treatment, such as selection of appropriate antibiotic or antiviral therapies.

QIAGEN offers an extensive range of kits for diagnosing infectious diseases, including a broad menu of reliable

tests on the QIAsymphony and NeuMoDx automation systems, as well as QIAstat-Dx panels for respiratory and

gastrointestinal syndromes. We are expanding this portfolio by seeking regulatory approvals of new assays across

these platforms.

QIAGEN remains a global leader in screening technologies for HPV, a viral infection that is the primary cause of

cervical cancer, which kills about 270,000 women a year. Our gold standard digene HC2 HPV Test and our

Forensics and Human IdentificationMolecular DiagnosticsNext-Generation Sequencing (NGS)Selected QIAGEN brandsForensics and Human IdentificationSelected QIAGEN brandsOncologyImmune monitoringInfectious diseaseson the ability to accurately analyze purified nucleic acid samples from sources such as blood, tissue, body fluids and

stool. Automated systems must process tests reliably and efficiently, often handling hundreds of samples concurrently.

The range of assays for diseases and biomarkers, convenience and ease of laboratory workflow, and

standardization of lab procedures also influence success.

The molecular diagnostics market generates total sales estimated by industry experts at approximately $7 billion in

2019, including about $5 billion potentially addressable with QIAGEN's product portfolio. Molecular testing is the

most dynamic segment of the global in vitro diagnostics market, growing at an estimated annual rate in the mid-

single-digits at constant exchange rates. Given the advantages of precise genetic information over traditional tests,

QIAGEN expects the healthcare market to continue to provide significant growth opportunities.

In QIAGEN’s Molecular Diagnostics business we focus on three priorities for fighting disease:

›

 - accurately diagnosing cancer, enabling prevention or early detection, as well as guiding selection of

therapies with individualized molecular insights for precision medicine.

QIAGEN's oncology test portfolio includes a broad range of technologies and biomarkers for Precision Medicine,

including regulator-approved companion diagnostics for oncogenes such as KRAS, EGFR BRCA1/2, JAK2,

PIK3CA and others, as well as comprehensive gene panels for research applications in next-generation

sequencing. We also provide industry-leading tests to screen for human papillomavirus (HPV) and protect women

from cervical cancer.

We have a deep pipeline of oncology tests for PCR and NGS analysis under development. In addition to our

portfolio of molecular technologies and automation systems, QIAGEN offers Pharma partners a full infrastructure
for co-development programs, intellectual property on platforms and content, regulatory experience, global
marketing reach, and independence as a company focusing exclusively on these types of technologies.

›

 - using advanced tests to detect immune-system markers as a preventive strategy, such as

screening patients for latent tuberculosis infection to guard against active TB disease, or to monitor immune
function, for example in transplant patients. Our sensitive QuantiFERON technology accurately detects infection
and measures immune response.

Our lead products in this field, QuantiFERON-TB Gold Plus and QuantiFERON-TB Gold, are used in tuberculosis
control efforts worldwide to detect latent TB infection (LTBI) by screening vulnerable populations, including close
contacts of patients with active TB disease, immunocompromised persons or patients on immunosuppressive drugs.
Individuals with LTBI can then be treated, preventing the infection from becoming active and contagious. As
modern blood tests analyzed in a laboratory, the QuantiFERON-TB assays are faster, less labor-intensive and more
accurate than the century-old tuberculin skin test. The potential global market for latent TB infection testing is
estimated at up to $1 billion.

In transplantation, our QuantiFERON Monitor provides monitoring of immune function in solid organ transplant
patients and QuantiFERON-CMV Kit tests immunity for infection with cytomegalovirus (CMV) in at-risk patients.

›

 - detecting and differentiating viral and bacterial infections - such as HIV, hepatitis, influenza,

sexually transmitted diseases and healthcare-associated infections, as well as respiratory and gastrointestinal
syndromes - can be useful in guiding treatment, such as selection of appropriate antibiotic or antiviral therapies.

QIAGEN offers an extensive range of kits for diagnosing infectious diseases, including a broad menu of reliable
tests on the QIAsymphony and NeuMoDx automation systems, as well as QIAstat-Dx panels for respiratory and
gastrointestinal syndromes. We are expanding this portfolio by seeking regulatory approvals of new assays across
these platforms.

QIAGEN remains a global leader in screening technologies for HPV, a viral infection that is the primary cause of
cervical cancer, which kills about 270,000 women a year. Our gold standard digene HC2 HPV Test and our
careHPV Test for use in low-resource regions lead the market in HPV screening around the world. In the United
States, vigorous price competition has reduced QIAGEN’s HPV business to about 1% of total sales.

QIAGEN partners with customers across diverse disciplines in academia and industry, providing sample
technologies, assay technologies, Digital Insights and services to universities and institutes, Pharma and biotech
companies, government and law enforcement agencies. Life Sciences customers accounted for $789 million of our
sales in 2019.

QIAGEN provides Sample to Insight solutions to academic and research institutions around the world. We focus on
enabling researchers to use reliable, fast, highly reproducible and high-quality technologies, sometimes replacing
time-consuming traditional or in-house methods. QIAGEN often partners with leading institutions in research projects
and develops customized solutions such as NGS panels for digital sequencing of multiple gene targets. As academic
institutions increasingly embrace translational research, bridging from discoveries to practical applications in
medicine, our relationships in Academia also support our presence in the Pharma and Molecular Diagnostics
markets.

Applied Testing customers make up the growing market for molecular testing beyond research and human
healthcare. QIAGEN is a global leader in solutions for governments and industry, particularly in forensic testing and
human identification. The value of genetic "fingerprinting" has been proven in criminal investigations and
examinations of paternity or ancestry, as well as food safety and veterinary diagnostics. QIAGEN provides sample
collection and analytical solutions for law enforcement and human identification labs, as well as advanced
technologies for studies of microbiomes and their effect on health and the environment.

QIAGEN has deep relationships with pharmaceutical and biotechnology companies. Drug discovery and
translational research efforts increasingly employ genomic information, both to guide research in diseases and to
differentiate patient populations most likely to respond to particular therapies. We estimate that about half of
34
QIAGEN sales to these companies support research, while the other half supports clinical development, including
stratification of patient populations based on genetic information. QIAGEN Digital Insights solutions also are widely

used to guide pharmaceutical research.

In Precision Medicine, we have built a position as the industry’s preferred partner to co-develop companion

diagnostics paired with targeted drugs. QIAGEN’s more than 25 master collaboration agreements with Pharma

customers, some with multiple co-development projects, have created a rich pipeline of molecular tests that are

transforming the treatment of cancer and other diseases. Companion diagnostics can move through clinical trials and

regulatory approvals, along with the paired drugs, to commercialization and marketing to healthcare providers.

Global Presence by Category of Activity and Geographic Market

Net sales for the product categories are attributed based on those revenues related to sample and assay products

and related revenues including bioinformatics solutions, and revenues derived from instrumentation sales.

Consumables and related revenues

Instrumentation

$ 1,354,147

$ 1,315,459

$ 1,242,715

172,277

186,389

174,821

$ 1,526,424

$ 1,501,848

$ 1,417,536

OncologyImmune monitoringInfectious diseasesLife SciencesAcademia / Applied TestingPharmaProduct Category Information(in thousands)201920182017Net SalesTotalcareHPV Test for use in low-resource regions lead the market in HPV screening around the world. In the United

careHPV Test for use in low-resource regions lead the market in HPV screening around the world. In the United

States, vigorous price competition has reduced QIAGEN’s HPV business to about 1% of total sales.

States, vigorous price competition has reduced QIAGEN’s HPV business to about 1% of total sales.

QIAGEN partners with customers across diverse disciplines in academia and industry, providing sample

QIAGEN partners with customers across diverse disciplines in academia and industry, providing sample

technologies, assay technologies, Digital Insights and services to universities and institutes, Pharma and biotech

technologies, assay technologies, Digital Insights and services to universities and institutes, Pharma and biotech

companies, government and law enforcement agencies. Life Sciences customers accounted for $789 million of our

companies, government and law enforcement agencies. Life Sciences customers accounted for $789 million of our

sales in 2019.

sales in 2019.

QIAGEN provides Sample to Insight solutions to academic and research institutions around the world. We focus on

QIAGEN provides Sample to Insight solutions to academic and research institutions around the world. We focus on

enabling researchers to use reliable, fast, highly reproducible and high-quality technologies, sometimes replacing

enabling researchers to use reliable, fast, highly reproducible and high-quality technologies, sometimes replacing

time-consuming traditional or in-house methods. QIAGEN often partners with leading institutions in research projects

time-consuming traditional or in-house methods. QIAGEN often partners with leading institutions in research projects

and develops customized solutions such as NGS panels for digital sequencing of multiple gene targets. As academic

and develops customized solutions such as NGS panels for digital sequencing of multiple gene targets. As academic

careHPV Test for use in low-resource regions lead the market in HPV screening around the world. In the United

institutions increasingly embrace translational research, bridging from discoveries to practical applications in

institutions increasingly embrace translational research, bridging from discoveries to practical applications in

States, vigorous price competition has reduced QIAGEN’s HPV business to about 1% of total sales.

medicine, our relationships in Academia also support our presence in the Pharma and Molecular Diagnostics

medicine, our relationships in Academia also support our presence in the Pharma and Molecular Diagnostics

markets.
markets.

Business and Operating Environment

M A N A G E M E N T   R E P O R T
Applied Testing customers make up the growing market for molecular testing beyond research and human
Applied Testing customers make up the growing market for molecular testing beyond research and human
QIAGEN partners with customers across diverse disciplines in academia and industry, providing sample
healthcare. QIAGEN is a global leader in solutions for governments and industry, particularly in forensic testing and
healthcare. QIAGEN is a global leader in solutions for governments and industry, particularly in forensic testing and
technologies, assay technologies, Digital Insights and services to universities and institutes, Pharma and biotech
human identification. The value of genetic "fingerprinting" has been proven in criminal investigations and
human identification. The value of genetic "fingerprinting" has been proven in criminal investigations and
companies, government and law enforcement agencies. Life Sciences customers accounted for $789 million of our
examinations of paternity or ancestry, as well as food safety and veterinary diagnostics. QIAGEN provides sample
examinations of paternity or ancestry, as well as food safety and veterinary diagnostics. QIAGEN provides sample
sales in 2019.
collection and analytical solutions for law enforcement and human identification labs, as well as advanced
collection and analytical solutions for law enforcement and human identification labs, as well as advanced
technologies for studies of microbiomes and their effect on health and the environment.
technologies for studies of microbiomes and their effect on health and the environment.

QIAGEN provides Sample to Insight solutions to academic and research institutions around the world. We focus on
enabling researchers to use reliable, fast, highly reproducible and high-quality technologies, sometimes replacing
QIAGEN has deep relationships with pharmaceutical and biotechnology companies. Drug discovery and
QIAGEN has deep relationships with pharmaceutical and biotechnology companies. Drug discovery and
time-consuming traditional or in-house methods. QIAGEN often partners with leading institutions in research projects
translational research efforts increasingly employ genomic information, both to guide research in diseases and to
translational research efforts increasingly employ genomic information, both to guide research in diseases and to
and develops customized solutions such as NGS panels for digital sequencing of multiple gene targets. As academic
differentiate patient populations most likely to respond to particular therapies. We estimate that about half of
differentiate patient populations most likely to respond to particular therapies. We estimate that about half of
institutions increasingly embrace translational research, bridging from discoveries to practical applications in
QIAGEN sales to these companies support research, while the other half supports clinical development, including
QIAGEN sales to these companies support research, while the other half supports clinical development, including
medicine, our relationships in Academia also support our presence in the Pharma and Molecular Diagnostics
stratification of patient populations based on genetic information. QIAGEN Digital Insights solutions also are widely
stratification of patient populations based on genetic information. QIAGEN Digital Insights solutions also are widely
markets.
used to guide pharmaceutical research.
used to guide pharmaceutical research.

Applied Testing customers make up the growing market for molecular testing beyond research and human
In Precision Medicine, we have built a position as the industry’s preferred partner to co-develop companion
In Precision Medicine, we have built a position as the industry’s preferred partner to co-develop companion
healthcare. QIAGEN is a global leader in solutions for governments and industry, particularly in forensic testing and
diagnostics paired with targeted drugs. QIAGEN’s more than 25 master collaboration agreements with Pharma
diagnostics paired with targeted drugs. QIAGEN’s more than 25 master collaboration agreements with Pharma
human identification. The value of genetic "fingerprinting" has been proven in criminal investigations and
customers, some with multiple co-development projects, have created a rich pipeline of molecular tests that are
customers, some with multiple co-development projects, have created a rich pipeline of molecular tests that are
examinations of paternity or ancestry, as well as food safety and veterinary diagnostics. QIAGEN provides sample
transforming the treatment of cancer and other diseases. Companion diagnostics can move through clinical trials and
transforming the treatment of cancer and other diseases. Companion diagnostics can move through clinical trials and
collection and analytical solutions for law enforcement and human identification labs, as well as advanced
regulatory approvals, along with the paired drugs, to commercialization and marketing to healthcare providers.
regulatory approvals, along with the paired drugs, to commercialization and marketing to healthcare providers.
technologies for studies of microbiomes and their effect on health and the environment.

Global Presence by Category of Activity and Geographic Market
Global Presence by Category of Activity and Geographic Market
QIAGEN has deep relationships with pharmaceutical and biotechnology companies. Drug discovery and
translational research efforts increasingly employ genomic information, both to guide research in diseases and to
Net sales for the product categories are attributed based on those revenues related to sample and assay products
Net sales for the product categories are attributed based on those revenues related to sample and assay products
differentiate patient populations most likely to respond to particular therapies. We estimate that about half of
and related revenues including bioinformatics solutions, and revenues derived from instrumentation sales.
and related revenues including bioinformatics solutions, and revenues derived from instrumentation sales.
QIAGEN sales to these companies support research, while the other half supports clinical development, including
stratification of patient populations based on genetic information. QIAGEN Digital Insights solutions also are widely
used to guide pharmaceutical research.

Consumables and related revenues
Consumables and related revenues

In Precision Medicine, we have built a position as the industry’s preferred partner to co-develop companion
diagnostics paired with targeted drugs. QIAGEN’s more than 25 master collaboration agreements with Pharma
customers, some with multiple co-development projects, have created a rich pipeline of molecular tests that are
transforming the treatment of cancer and other diseases. Companion diagnostics can move through clinical trials and
174,821
174,821
regulatory approvals, along with the paired drugs, to commercialization and marketing to healthcare providers.

Instrumentation
Instrumentation

$ 1,242,715
$ 1,242,715

$ 1,354,147
$ 1,354,147

$ 1,315,459
$ 1,315,459

172,277
172,277

186,389
186,389

$ 1,526,424
$ 1,526,424

$ 1,501,848
$ 1,501,848

$ 1,417,536
$ 1,417,536

Global Presence by Category of Activity and Geographic Market

QIAGEN currently markets products in more than 130 countries. The following table shows total revenue by
geographic market for the past three years (net sales are attributed to countries based on the location of the
Net sales for the product categories are attributed based on those revenues related to sample and assay products
customer, as certain subsidiaries have international distribution):
and related revenues including bioinformatics solutions, and revenues derived from instrumentation sales.

Americas:
Consumables and related revenues

Instrumentation

United States

Other Americas

Europe, Middle East and Africa

Asia Pacific and Rest of World

$ 1,354,147

$ 1,315,459

$ 1,242,715

$ 663,869
172,277

$ 632,660
186,389

$ 579,906
174,821

58,121
$ 1,526,424

60,359
$ 1,501,848

73,478
$ 1,417,536

721,990

693,019

653,384

487,476

490,301

462,980

316,958

318,528

301,172

$ 1,526,424

$ 1,501,848

$ 1,417,536

QIAGEN has built an increasing presence in key emerging markets as a growth strategy. The top seven emerging
markets - Brazil, Russia, India, China, South Korea, Mexico and Turkey - contributed approximately 16% of net sales
in 2019, 2018 and 2017.

35

Research and Development

We are committed to expanding our global leadership in Sample to Insight solutions in Molecular Diagnostics and

the Life Sciences. We target our research and development resources to the most promising technologies to address

the unmet needs of our customers in healthcare and research labs in key geographic markets.

As a percentage of sales, our research and development investments are among the highest in our industry. About

950 employees in research and development work in QIAGEN centers of excellence on three continents.

Innovation at QIAGEN follows parallel paths:

molecular technologies.

genetic identification.

›

Creating new systems for automation of workflows - platforms for laboratories, hospitals and other users of novel

›

Expanding our broad portfolio of novel content - including assays to detect and measure biomarkers for disease or

›

Integrating Digital Insights with the testing process - software and cloud-based resources to interpret and transform

raw molecular data into useful insights.

Innovation in automation systems positions QIAGEN in fast-growing fields of molecular testing, as well as generating

ongoing demand for our consumable products. We are developing and commercializing a deep pipeline of assays

for preventive screening and diagnostic profiling of diseases, detection of biomarkers to guide Precision Medicine in

cancer and other diseases, and other molecular targets. Our assay development program aims to commercialize

tests that will add value to our QIAsymphony, QIAstat-Dx and NeuMoDx automation systems in the coming years, as

well as next-generation sequencing kits to support our universal NGS franchise and our in vitro diagnostics

partnership with Illumina. In 2019, we launched novel companion diagnostics on the QIAsymphony platform for

breast, lung and urothelial cancers. We also added the FDA approved respiratory panel for infectious diseases to

the menus for QIAstat-Dx and the NeuMoDx 96 and 288 platforms.

QIAGEN collaborates with many institutions and companies to create innovative molecular solutions. In May 2019,

partnering with U.K.-based organizations, we launched APIS Assay Technologies Ltd., a new company aiming to

Life SciencesAcademia / Applied TestingPharmaProduct Category Information(in thousands)201920182017Net SalesTotalGeographical Information(in thousands)201920182017Net SalesTotal AmericasTotalLife SciencesAcademia / Applied TestingPharmaProduct Category Information(in thousands)201920182017Net SalesTotalLife SciencesAcademia / Applied TestingPharmaProduct Category Information(in thousands)201920182017Net SalesTotalQIAGEN currently markets products in more than 130 countries. The following table shows total revenue by

geographic market for the past three years (net sales are attributed to countries based on the location of the

customer, as certain subsidiaries have international distribution):

Americas:

United States

Other Americas

Europe, Middle East and Africa

Asia Pacific and Rest of World

$ 663,869

$ 632,660

$ 579,906

58,121

60,359

73,478

721,990

693,019

653,384

487,476

490,301

462,980

316,958

318,528

301,172

$ 1,526,424

$ 1,501,848

$ 1,417,536

QIAGEN has built an increasing presence in key emerging markets as a growth strategy. The top seven emerging
markets - Brazil, Russia, India, China, South Korea, Mexico and Turkey - contributed approximately 16% of net sales
in 2019, 2018 and 2017.

Research and Development

We are committed to expanding our global leadership in Sample to Insight solutions in Molecular Diagnostics and
the Life Sciences. We target our research and development resources to the most promising technologies to address
the unmet needs of our customers in healthcare and research labs in key geographic markets.

As a percentage of sales, our research and development investments are among the highest in our industry. About
950 employees in research and development work in QIAGEN centers of excellence on three continents.

Innovation at QIAGEN follows parallel paths:

›

›

›

Creating new systems for automation of workflows - platforms for laboratories, hospitals and other users of novel
molecular technologies.

Expanding our broad portfolio of novel content - including assays to detect and measure biomarkers for disease or
genetic identification.

Integrating Digital Insights with the testing process - software and cloud-based resources to interpret and transform
raw molecular data into useful insights.

Innovation in automation systems positions QIAGEN in fast-growing fields of molecular testing, as well as generating
ongoing demand for our consumable products. We are developing and commercializing a deep pipeline of assays
for preventive screening and diagnostic profiling of diseases, detection of biomarkers to guide Precision Medicine in
cancer and other diseases, and other molecular targets. Our assay development program aims to commercialize
tests that will add value to our QIAsymphony, QIAstat-Dx and NeuMoDx automation systems in the coming years, as
well as next-generation sequencing kits to support our universal NGS franchise and our in vitro diagnostics
partnership with Illumina. In 2019, we launched novel companion diagnostics on the QIAsymphony platform for
breast, lung and urothelial cancers. We also added the FDA approved respiratory panel for infectious diseases to
the menus for QIAstat-Dx and the NeuMoDx 96 and 288 platforms.

QIAGEN collaborates with many institutions and companies to create innovative molecular solutions. In May 2019,
partnering with U.K.-based organizations, we launched APIS Assay Technologies Ltd., a new company aiming to
accelerate biomarker commercialization by bridging the translational gap between genomic discoveries and the
development of new diagnostics.

Our Digital Insights teams are developing new software and adding proprietary cloud-based content to support the
latest research and clinical trends in molecular testing, especially the interpretation of large volumes of NGS data.
We also integrate digital solutions with instruments and molecular content to provide our customers seamless Sample
to Insight workflows.

Sales and Marketing

We market our products in more than 130 countries, mainly through subsidiaries in markets in the Americas, Europe,
Australia and Asia with the greatest sales potential. Experienced marketing and sales staff, many of them scientists
with academic degrees in molecular biology or related areas, sell our products and support our customers. Business
managers oversee key accounts to ensure that we serve customers’ commercial needs, such as procurement
processes, financing, data on costs and value of our systems, and collaborative relationships. In many markets, we
have specialized independent distributors and importers.

36

Our marketing strategy focuses on providing differentiated, high-quality products across the value chain from Sample
to Insight, integrating components into end-to-end solutions when possible, and enhancing relationships with

commitment to technical excellence and customer service. Our omni-channel approach seeks to engage customers

through their preferred channels - online, by phone, in person, etc. - and to optimize investment in different customer

types.

QIAGEN has initiated actions to drive the growth of our digital marketing channels - including our website

(www.QIAGEN.com), product-specific sites and social media. Our eCommerce team works with clients to provide

automated processes supporting a variety of electronic transactions and all major eProcurement systems. Information

contained on our website, or accessed through it, is not part of this Annual Report.

Our GeneGlobe Design & Analysis Hub (www.geneglobe.com), upgraded in September 2019, is a valuable

outreach to scientists in Pharma and Academia, enabling researchers to search and order from approximately 25

million pre-designed and custom PCR assay kits, NGS assay panels and other products. The new hub brings next-

level experiment planning, execution and follow-up to life science researchers, linking our Digital Insights solutions

with ordering of assays to accelerate research.

QIAGEN uses a range of tools to provide customers with direct access to technical support, inform them of new

product offerings, and enhance our reputation for technical excellence, high-quality products and commitment to

service. For example, our technical service hotline allows existing or potential customers to discuss a wide range of

questions about our products and molecular biology procedures, online or via phone, with Ph.D. and M.Sc. scientists

at QIAGEN. Frequent communication with customers enables us to identify market needs, learn of new developments

and opportunities, and respond with new products.

We also distribute publications, including our catalog, to existing and potential customers worldwide, providing new

product information, updates, and articles about existing and new applications. In addition, we hold numerous

scientific seminars at clinical, academic and industrial research institutes worldwide and at major scientific and

clinical meetings. We conduct direct marketing campaigns to announce new products and special promotions, and

we offer personalized electronic newsletters and webinars highlighting molecular biology applications.

For laboratories that frequently rely on our consumables, the QIAstock program maintains inventory on-site to keep

up with their requirements. QIAGEN representatives make regular visits to replenish the stock and help with other

needs, and we are automating this process with digital technologies. Easy-to-use online ordering, inventory

monitoring and customer-driven changes make QIAstock an efficient system for providing ready access to our

products for the hundreds of customers worldwide who use this program.

Seasonality

Geographical Information(in thousands)201920182017Net SalesTotal AmericasTotalaccelerate biomarker commercialization by bridging the translational gap between genomic discoveries and the
development of new diagnostics.
M A N A G E M E N T   R E P O R T

Business and Operating Environment

Our Digital Insights teams are developing new software and adding proprietary cloud-based content to support the
latest research and clinical trends in molecular testing, especially the interpretation of large volumes of NGS data.
We also integrate digital solutions with instruments and molecular content to provide our customers seamless Sample
to Insight workflows.

Sales and Marketing

We market our products in more than 130 countries, mainly through subsidiaries in markets in the Americas, Europe,
Australia and Asia with the greatest sales potential. Experienced marketing and sales staff, many of them scientists
with academic degrees in molecular biology or related areas, sell our products and support our customers. Business
managers oversee key accounts to ensure that we serve customers’ commercial needs, such as procurement
processes, financing, data on costs and value of our systems, and collaborative relationships. In many markets, we
have specialized independent distributors and importers.

Our marketing strategy focuses on providing differentiated, high-quality products across the value chain from Sample
to Insight, integrating components into end-to-end solutions when possible, and enhancing relationships with
commitment to technical excellence and customer service. Our omni-channel approach seeks to engage customers
through their preferred channels - online, by phone, in person, etc. - and to optimize investment in different customer
types.

QIAGEN has initiated actions to drive the growth of our digital marketing channels - including our website
(www.QIAGEN.com), product-specific sites and social media. Our eCommerce team works with clients to provide
automated processes supporting a variety of electronic transactions and all major eProcurement systems. Information
contained on our website, or accessed through it, is not part of this Annual Report.

Our GeneGlobe Design & Analysis Hub (www.geneglobe.com), upgraded in September 2019, is a valuable
outreach to scientists in Pharma and Academia, enabling researchers to search and order from approximately 25
million pre-designed and custom PCR assay kits, NGS assay panels and other products. The new hub brings next-
level experiment planning, execution and follow-up to life science researchers, linking our Digital Insights solutions
with ordering of assays to accelerate research.

QIAGEN uses a range of tools to provide customers with direct access to technical support, inform them of new
product offerings, and enhance our reputation for technical excellence, high-quality products and commitment to
service. For example, our technical service hotline allows existing or potential customers to discuss a wide range of
questions about our products and molecular biology procedures, online or via phone, with Ph.D. and M.Sc. scientists
at QIAGEN. Frequent communication with customers enables us to identify market needs, learn of new developments
and opportunities, and respond with new products.

We also distribute publications, including our catalog, to existing and potential customers worldwide, providing new
product information, updates, and articles about existing and new applications. In addition, we hold numerous
scientific seminars at clinical, academic and industrial research institutes worldwide and at major scientific and
clinical meetings. We conduct direct marketing campaigns to announce new products and special promotions, and
we offer personalized electronic newsletters and webinars highlighting molecular biology applications.

For laboratories that frequently rely on our consumables, the QIAstock program maintains inventory on-site to keep
up with their requirements. QIAGEN representatives make regular visits to replenish the stock and help with other
needs, and we are automating this process with digital technologies. Easy-to-use online ordering, inventory
monitoring and customer-driven changes make QIAstock an efficient system for providing ready access to our
products for the hundreds of customers worldwide who use this program.

Seasonality

37

accelerate biomarker commercialization by bridging the translational gap between genomic discoveries and the

development of new diagnostics.

Our Digital Insights teams are developing new software and adding proprietary cloud-based content to support the

latest research and clinical trends in molecular testing, especially the interpretation of large volumes of NGS data.

We also integrate digital solutions with instruments and molecular content to provide our customers seamless Sample

to Insight workflows.

Sales and Marketing

We market our products in more than 130 countries, mainly through subsidiaries in markets in the Americas, Europe,

Australia and Asia with the greatest sales potential. Experienced marketing and sales staff, many of them scientists

with academic degrees in molecular biology or related areas, sell our products and support our customers. Business

managers oversee key accounts to ensure that we serve customers’ commercial needs, such as procurement

processes, financing, data on costs and value of our systems, and collaborative relationships. In many markets, we

have specialized independent distributors and importers.

Our marketing strategy focuses on providing differentiated, high-quality products across the value chain from Sample

to Insight, integrating components into end-to-end solutions when possible, and enhancing relationships with

commitment to technical excellence and customer service. Our omni-channel approach seeks to engage customers

through their preferred channels - online, by phone, in person, etc. - and to optimize investment in different customer

types.

QIAGEN has initiated actions to drive the growth of our digital marketing channels - including our website

(www.QIAGEN.com), product-specific sites and social media. Our eCommerce team works with clients to provide

automated processes supporting a variety of electronic transactions and all major eProcurement systems. Information

contained on our website, or accessed through it, is not part of this Annual Report.

Our GeneGlobe Design & Analysis Hub (www.geneglobe.com), upgraded in September 2019, is a valuable

outreach to scientists in Pharma and Academia, enabling researchers to search and order from approximately 25

million pre-designed and custom PCR assay kits, NGS assay panels and other products. The new hub brings next-

level experiment planning, execution and follow-up to life science researchers, linking our Digital Insights solutions

with ordering of assays to accelerate research.

QIAGEN uses a range of tools to provide customers with direct access to technical support, inform them of new

product offerings, and enhance our reputation for technical excellence, high-quality products and commitment to

service. For example, our technical service hotline allows existing or potential customers to discuss a wide range of

questions about our products and molecular biology procedures, online or via phone, with Ph.D. and M.Sc. scientists

at QIAGEN. Frequent communication with customers enables us to identify market needs, learn of new developments

and opportunities, and respond with new products.

We also distribute publications, including our catalog, to existing and potential customers worldwide, providing new

product information, updates, and articles about existing and new applications. In addition, we hold numerous

scientific seminars at clinical, academic and industrial research institutes worldwide and at major scientific and

clinical meetings. We conduct direct marketing campaigns to announce new products and special promotions, and
we offer personalized electronic newsletters and webinars highlighting molecular biology applications.

For laboratories that frequently rely on our consumables, the QIAstock program maintains inventory on-site to keep
up with their requirements. QIAGEN representatives make regular visits to replenish the stock and help with other
needs, and we are automating this process with digital technologies. Easy-to-use online ordering, inventory
monitoring and customer-driven changes make QIAstock an efficient system for providing ready access to our
products for the hundreds of customers worldwide who use this program.

Seasonality

Our business does not experience significant, predictable seasonality. Historically, a significant portion of our sales
have been to researchers, universities, government laboratories and private foundations whose funding is dependent
upon grants from government agencies, such as the National Institutes of Health and similar bodies. To the extent
that our customers experience increases, decreases or delays in funding arrangements and budget approvals, and to
the extent that customers' activities are slowed such as during times of higher unemployment, vacation periods or
delays in approval of government budgets, we may experience fluctuations in sales volumes during the year or
delays from one period to the next in the recognition of sales. Additionally, we have customers who are active in the
diagnostics testing market, and sales to these customers fluctuate to the extent their activities are impacted by public
health concerns such as the timing and severity of flu season.

Intellectual Property, Proprietary Rights and Licenses

We have made and expect to continue to make investments in intellectual property. In 2019, additions to our
intangible assets outside of business combinations totaled $286.2 million. While we do not depend solely on any
individual patent or technology, we are significantly dependent in the aggregate on technology that we own or
license. Therefore, we consider protection of proprietary technologies and products one of the major keys to our
business success. We rely on a combination of patents, licenses and trademarks to establish and protect proprietary
rights. As of December 31, 2019, we owned 352 issued patents in the United States, 275 issued patents in
Germany and 1,700 issued patents in other major industrialized countries. We had 558 pending patent
applications. Our policy is to file patent applications in Western Europe, the United States and Japan. U.S. patents
have a term of 17 years from the date of issue (for patents issued from applications submitted prior to June 8, 1995),
or 20 years from the date of filing (in the case of patents issued from applications submitted on or after June 8,
1995). Patents in most other countries have a term of 20 years from the date of filing the patent application. We
intend to aggressively prosecute and enforce patents and to otherwise protect our proprietary technologies. We also
rely on trade secrets, know-how, continuing technological innovation and licensing opportunities to develop and
maintain our competitive position.

Our practice is to require employees, consultants, outside scientific collaborators, sponsored researchers and other
advisers to execute confidentiality agreements upon commencement of their relationships with us. These agreements
provide that all confidential information developed by or made known to the individual during the course of the
relationship is to be kept confidential and not disclosed to third parties, subject to a right to publish certain
information in scientific literature in certain circumstances and to other specific exceptions. In the case of our
employees, the agreements provide that all inventions conceived by individuals in the course of their employment will
be our exclusive property.

See “Risks” included in the “Opportunities and Risks” section below for details regarding risks related to our reliance
on patents and proprietary rights.

Competition

In the Academic and Pharma markets, we believe our primary competition in sample technology products involves
traditional separation and purification methods, such as phenol extraction, cesium chloride density gradient
centrifugation, and precipitation. These methods utilize widely available reagents and other chemicals supplied by
companies in these markets. We compete with these methods through innovative technologies and products, offering
a comprehensive solution for nucleic acid collection, pre-treatment, separation and purification needs and providing
significant advantages in speed, reliability, convenience, reproducibility and ease of use.

We also experience competition in various markets from other companies providing sample preparation products in
kit form and assay solutions. These competitors include, but are not limited to, companies with a focus on nucleic
acid separation and purification, assay solutions, transfection reagents and protein fractionation products. We
believe our proprietary technologies and products offer significant advantages over competitors' products with
38
regard to purity, speed, reliability and ease-of-use.

Some of our other products within our molecular diagnostics customer class, such as tests for Chlamydia, Gonorrhea,

hepatitis B virus, herpes simplex virus and CMV, compete against existing screening, monitoring and diagnostic

technologies, including tissue culture and antigen-based diagnostic methodologies. We believe the primary

Our business does not experience significant, predictable seasonality. Historically, a significant portion of our sales

have been to researchers, universities, government laboratories and private foundations whose funding is dependent

upon grants from government agencies, such as the National Institutes of Health and similar bodies. To the extent

that our customers experience increases, decreases or delays in funding arrangements and budget approvals, and to

the extent that customers' activities are slowed such as during times of higher unemployment, vacation periods or

delays in approval of government budgets, we may experience fluctuations in sales volumes during the year or

delays from one period to the next in the recognition of sales. Additionally, we have customers who are active in the

diagnostics testing market, and sales to these customers fluctuate to the extent their activities are impacted by public

health concerns such as the timing and severity of flu season.

Intellectual Property, Proprietary Rights and Licenses

We have made and expect to continue to make investments in intellectual property. In 2019, additions to our

intangible assets outside of business combinations totaled $286.2 million. While we do not depend solely on any

individual patent or technology, we are significantly dependent in the aggregate on technology that we own or

license. Therefore, we consider protection of proprietary technologies and products one of the major keys to our

business success. We rely on a combination of patents, licenses and trademarks to establish and protect proprietary

rights. As of December 31, 2019, we owned 352 issued patents in the United States, 275 issued patents in

Germany and 1,700 issued patents in other major industrialized countries. We had 558 pending patent

applications. Our policy is to file patent applications in Western Europe, the United States and Japan. U.S. patents

have a term of 17 years from the date of issue (for patents issued from applications submitted prior to June 8, 1995),

or 20 years from the date of filing (in the case of patents issued from applications submitted on or after June 8,

1995). Patents in most other countries have a term of 20 years from the date of filing the patent application. We

intend to aggressively prosecute and enforce patents and to otherwise protect our proprietary technologies. We also

rely on trade secrets, know-how, continuing technological innovation and licensing opportunities to develop and

maintain our competitive position.

Our practice is to require employees, consultants, outside scientific collaborators, sponsored researchers and other

advisers to execute confidentiality agreements upon commencement of their relationships with us. These agreements

provide that all confidential information developed by or made known to the individual during the course of the

relationship is to be kept confidential and not disclosed to third parties, subject to a right to publish certain

information in scientific literature in certain circumstances and to other specific exceptions. In the case of our

employees, the agreements provide that all inventions conceived by individuals in the course of their employment will

See “Risks” included in the “Opportunities and Risks” section below for details regarding risks related to our reliance

be our exclusive property.

on patents and proprietary rights.

Competition

Business and Operating Environment

M A N A G E M E N T   R E P O R T
In the Academic and Pharma markets, we believe our primary competition in sample technology products involves
traditional separation and purification methods, such as phenol extraction, cesium chloride density gradient
centrifugation, and precipitation. These methods utilize widely available reagents and other chemicals supplied by
companies in these markets. We compete with these methods through innovative technologies and products, offering
a comprehensive solution for nucleic acid collection, pre-treatment, separation and purification needs and providing
significant advantages in speed, reliability, convenience, reproducibility and ease of use.

We also experience competition in various markets from other companies providing sample preparation products in
kit form and assay solutions. These competitors include, but are not limited to, companies with a focus on nucleic
acid separation and purification, assay solutions, transfection reagents and protein fractionation products. We
believe our proprietary technologies and products offer significant advantages over competitors' products with
regard to purity, speed, reliability and ease-of-use.

Some of our other products within our molecular diagnostics customer class, such as tests for Chlamydia, Gonorrhea,
hepatitis B virus, herpes simplex virus and CMV, compete against existing screening, monitoring and diagnostic
technologies, including tissue culture and antigen-based diagnostic methodologies. We believe the primary
competitive factors in the market for gene-based probe diagnostics and other screening devices are clinical
validation, performance and reliability, ease of use, standardization, cost, proprietary position, competitors' market
shares, access to distribution channels, regulatory approvals and reimbursement.

We do not believe our competitors typically have the same comprehensive approach to sample to insight solutions as
we do or the ability to provide the broad range of technologies and depth of products and services that we offer.
With our complete range of manual and fully automated solutions, we believe we offer the value of standardization
of procedures and, therefore, more reliable results. We also believe our integrated strategic approach gives us a
competitive advantage. The quality of sample technologies-an area in which we have a unique market and
leadership position-is a key prerequisite for reliable molecular assay solutions, which increasingly are being applied
in emerging markets such as Molecular Diagnostics and Applied Testing.

Current and potential competitors may be in the process of seeking FDA or foreign regulatory approvals for their
respective products. Our continued future success will depend in large part on our ability to maintain our
technological advantage over competing products, expand our market presence and preserve customer loyalty.
There can be no assurance that we will be able to compete effectively in the future or that development by others will
not render our technologies or products non-competitive.

Suppliers

As part of our supplier assessment procedures, we evaluate on a monthly basis the supply performance of our raw
material and component suppliers, and we assess on a continuous basis potential alternative sources of such
materials and components, and on a yearly basis assess the risks and benefits of reliance on our existing suppliers.
We buy materials for our products from many suppliers, and are not dependent on any one supplier or group of
suppliers for our business as a whole. Raw materials generally include chemicals, raw separation media, biologics,
plastics, electronics and packaging. Raw materials are generally readily available at competitive, stable prices from
a number of suppliers. Certain raw materials are produced under our specifications. We have inventory agreements
with the majority of our suppliers and we closely monitor stock levels to maintain adequate supplies. We believe we
maintain inventories at a sufficient level to ensure reasonable customer service levels and to guard against normal
volatility in availability.

Government Regulations

We are subject to a variety of laws and regulations in the European Union, the United States and other countries.
The level and scope of the regulation varies depending on the country or defined economic region, but may include,
among other things, the research, development, testing, clinical trials, manufacture, storage, recordkeeping,
approval, labeling, promotion and commercial sales and distribution, of many of our products.

In the European Union, in vitro diagnostic medical devices (IVDs) have been regulated under EU-Directive 98/79/EC
(IVD Directive) and corresponding national provisions, however, this Directive will be replaced by the In Vitro
Diagnostic Device Regulation (IVDR) in May 2022. The IVD Directive requires that medical devices meet the essential
requirements set out in an annex of the directive. These requirements include the safety and efficacy of the devices.
According to the IVD Directive, the Member States presume compliance with these essential requirements in respect
of devices which are in conformity with the relevant national standards transposing the harmonized standards of

39

which the reference numbers have been published in the Official Journal of the European Communities. These

harmonized standards include ISO 13485:2016, the quality standard for medical device manufacturers.

IVD medical devices, other than devices for performance evaluation, must bear the CE marking of conformity when

they are placed on the market. The CE mark is a declaration by the manufacturer that the product meets all the

appropriate provisions of the relevant legislation implementing the relevant European Directive. As a general rule,

the manufacturer must follow the procedure of the EC Declaration of conformity to obtain this CE marking.

European Union Regulationscompetitive factors in the market for gene-based probe diagnostics and other screening devices are clinical

validation, performance and reliability, ease of use, standardization, cost, proprietary position, competitors' market

shares, access to distribution channels, regulatory approvals and reimbursement.

We do not believe our competitors typically have the same comprehensive approach to sample to insight solutions as

we do or the ability to provide the broad range of technologies and depth of products and services that we offer.

With our complete range of manual and fully automated solutions, we believe we offer the value of standardization

of procedures and, therefore, more reliable results. We also believe our integrated strategic approach gives us a

competitive advantage. The quality of sample technologies-an area in which we have a unique market and

leadership position-is a key prerequisite for reliable molecular assay solutions, which increasingly are being applied

in emerging markets such as Molecular Diagnostics and Applied Testing.

Current and potential competitors may be in the process of seeking FDA or foreign regulatory approvals for their

respective products. Our continued future success will depend in large part on our ability to maintain our

technological advantage over competing products, expand our market presence and preserve customer loyalty.

There can be no assurance that we will be able to compete effectively in the future or that development by others will

not render our technologies or products non-competitive.

Suppliers

As part of our supplier assessment procedures, we evaluate on a monthly basis the supply performance of our raw

material and component suppliers, and we assess on a continuous basis potential alternative sources of such

materials and components, and on a yearly basis assess the risks and benefits of reliance on our existing suppliers.

We buy materials for our products from many suppliers, and are not dependent on any one supplier or group of

suppliers for our business as a whole. Raw materials generally include chemicals, raw separation media, biologics,

plastics, electronics and packaging. Raw materials are generally readily available at competitive, stable prices from

a number of suppliers. Certain raw materials are produced under our specifications. We have inventory agreements

with the majority of our suppliers and we closely monitor stock levels to maintain adequate supplies. We believe we

maintain inventories at a sufficient level to ensure reasonable customer service levels and to guard against normal

volatility in availability.

Government Regulations

We are subject to a variety of laws and regulations in the European Union, the United States and other countries.
The level and scope of the regulation varies depending on the country or defined economic region, but may include,
among other things, the research, development, testing, clinical trials, manufacture, storage, recordkeeping,
approval, labeling, promotion and commercial sales and distribution, of many of our products.

In the European Union, in vitro diagnostic medical devices (IVDs) have been regulated under EU-Directive 98/79/EC
(IVD Directive) and corresponding national provisions, however, this Directive will be replaced by the In Vitro
Diagnostic Device Regulation (IVDR) in May 2022. The IVD Directive requires that medical devices meet the essential
requirements set out in an annex of the directive. These requirements include the safety and efficacy of the devices.
According to the IVD Directive, the Member States presume compliance with these essential requirements in respect
of devices which are in conformity with the relevant national standards transposing the harmonized standards of
which the reference numbers have been published in the Official Journal of the European Communities. These
harmonized standards include ISO 13485:2016, the quality standard for medical device manufacturers.

IVD medical devices, other than devices for performance evaluation, must bear the CE marking of conformity when
they are placed on the market. The CE mark is a declaration by the manufacturer that the product meets all the
appropriate provisions of the relevant legislation implementing the relevant European Directive. As a general rule,
the manufacturer must follow the procedure of the EC Declaration of conformity to obtain this CE marking.

Each European country must adopt its own laws, regulations and administrative provisions necessary to comply with
the IVD Directive. Member States may not create any obstacle to the placing on the market or the putting into service
within their territory of devices bearing the CE marking according to the conformity assessment procedures.

Under the IVDR, which was enacted by the European Commission (EC) on May 25, 2017, in vitro diagnostics will
be subject to additional legal regulatory requirements after the IVDR comes into full effect on May 26, 2022. Once
implemented, the entire EU IVD industry will have to comply with these new requirements, which will bring the EU
regulatory landscape on par with other highly regulated markets such as the US. Many Guidance Documents and
other regulatory mechanisms will need to be established during this transition period and it is anticipated that it will
be late in 2020 before the infrastructure is established to begin the new approvals process.

In the United States, in vitro diagnostic products are subject to regulation by the FDA as medical devices to the extent
that they are intended for use in the diagnosis, treatment, mitigation or prevention of disease or other conditions.
They are subject to premarket review and postmarket controls which will differ depending on how the FDA classifies
a specific IVD. Certain types of tests like some that we manufacture and sell for research use only in the United States
have not been subject to FDA’s premarket review and controls because we do not promote these tests for clinical
diagnostic use, and they are labeled “For Research Use Only,” or RUO, as required by the FDA. Other tests, known
as laboratory developed tests (LDTs) which are in vitro diagnostic tests that are designed, manufactured and used
within a single laboratory, have generally been subject to enforcement discretion, which means that FDA generally
has not enforced premarket review and other applicable FDA requirements. However, as LDTs have increased in
complexity, the FDA has begun to take a risk-based approach to their regulation. Failure to comply with applicable
U.S. requirements may subject a company to a variety of administrative or judicial sanctions, such as FDA refusal to
approve pending PMAs, warning letters, product recalls, product seizures, total or partial suspension of production
or distribution, injunctions, fines, civil penalties and criminal prosecution.

The FDA regulates the sale or distribution of medical devices, including in vitro diagnostic test kits and some LDTs.
The information that must be submitted to the FDA in order to obtain clearance or approval to market a new medical
device varies depending on how the medical device is classified by the FDA. Medical devices are classified into one
of three classes depending on the controls deemed by the FDA to be necessary to reasonably ensure their safety and
effectiveness. Class I devices are subject to general controls, including labeling requirements, and adherence to the
FDA’s quality system regulations (QSRs), which are device-specific current good manufacturing practices. Class II
devices are subject to premarket notification, QSRs, general controls and sometimes special controls, including
performance standards and post-market surveillance. Class III devices are subject to most of the previously identified
requirements as well as to pre-market approval. Class I devices are exempt from premarket review; most Class II
40
devices require 510(k) clearance, and all Class III devices must receive premarket approval before they can be sold
in the United States. The payment of a user fee, that is typically adjusted annually, to the FDA is usually required

when a 510(k) notice or premarket approval application is submitted.

. A 510(k) premarket notification requires the sponsor to demonstrate that a medical

device is substantially equivalent to another marketed device, termed a “predicate device,” that is legally marketed

in the United States and for which a premarket approval was not required. A device is substantially equivalent to a

predicate device if it has the same intended use and technological characteristics as the predicate; or has the same

intended use but different technological characteristics, where the information submitted to the FDA does not raise

new questions of safety and effectiveness and demonstrates that the device is at least as safe and effective as the

legally marketed device.

The FDA generally issues a decision letter within 90 days of receipt of the 510(k) if it has no additional questions or

sends a first action letter requesting additional information within 75 days. Most 510(k)s do not require clinical data

for clearance, but a minority will. Requests for additional data, including clinical data, will increase the time

necessary to review the notice. If the FDA believes that the device is not substantially equivalent to a predicate

device, it will issue a “Not Substantially Equivalent” (NSE) determination and designate the device as a Class III

device, which will require the submission and approval of a PMA before the new device may be marketed. A person

who receives an NSE determination in response to a 510(k) submission may, within 30 days of receipt of the NSE

European Union RegulationsU.S. RegulationsIn Vitro Diagnostics510(k) Premarket NotificationEach European country must adopt its own laws, regulations and administrative provisions necessary to comply with

the IVD Directive. Member States may not create any obstacle to the placing on the market or the putting into service

within their territory of devices bearing the CE marking according to the conformity assessment procedures.

Under the IVDR, which was enacted by the European Commission (EC) on May 25, 2017, in vitro diagnostics will

be subject to additional legal regulatory requirements after the IVDR comes into full effect on May 26, 2022. Once

implemented, the entire EU IVD industry will have to comply with these new requirements, which will bring the EU

regulatory landscape on par with other highly regulated markets such as the US. Many Guidance Documents and

other regulatory mechanisms will need to be established during this transition period and it is anticipated that it will

be late in 2020 before the infrastructure is established to begin the new approvals process.

In the United States, in vitro diagnostic products are subject to regulation by the FDA as medical devices to the extent

that they are intended for use in the diagnosis, treatment, mitigation or prevention of disease or other conditions.

They are subject to premarket review and postmarket controls which will differ depending on how the FDA classifies

a specific IVD. Certain types of tests like some that we manufacture and sell for research use only in the United States

have not been subject to FDA’s premarket review and controls because we do not promote these tests for clinical

Business and Operating Environment

diagnostic use, and they are labeled “For Research Use Only,” or RUO, as required by the FDA. Other tests, known
as laboratory developed tests (LDTs) which are in vitro diagnostic tests that are designed, manufactured and used
M A N A G E M E N T   R E P O R T
within a single laboratory, have generally been subject to enforcement discretion, which means that FDA generally
has not enforced premarket review and other applicable FDA requirements. However, as LDTs have increased in
complexity, the FDA has begun to take a risk-based approach to their regulation. Failure to comply with applicable
U.S. requirements may subject a company to a variety of administrative or judicial sanctions, such as FDA refusal to
approve pending PMAs, warning letters, product recalls, product seizures, total or partial suspension of production
or distribution, injunctions, fines, civil penalties and criminal prosecution.

The FDA regulates the sale or distribution of medical devices, including in vitro diagnostic test kits and some LDTs.
The information that must be submitted to the FDA in order to obtain clearance or approval to market a new medical
device varies depending on how the medical device is classified by the FDA. Medical devices are classified into one
of three classes depending on the controls deemed by the FDA to be necessary to reasonably ensure their safety and
effectiveness. Class I devices are subject to general controls, including labeling requirements, and adherence to the
FDA’s quality system regulations (QSRs), which are device-specific current good manufacturing practices. Class II
devices are subject to premarket notification, QSRs, general controls and sometimes special controls, including
performance standards and post-market surveillance. Class III devices are subject to most of the previously identified
requirements as well as to pre-market approval. Class I devices are exempt from premarket review; most Class II
devices require 510(k) clearance, and all Class III devices must receive premarket approval before they can be sold
in the United States. The payment of a user fee, that is typically adjusted annually, to the FDA is usually required
when a 510(k) notice or premarket approval application is submitted.

. A 510(k) premarket notification requires the sponsor to demonstrate that a medical
device is substantially equivalent to another marketed device, termed a “predicate device,” that is legally marketed
in the United States and for which a premarket approval was not required. A device is substantially equivalent to a
predicate device if it has the same intended use and technological characteristics as the predicate; or has the same
intended use but different technological characteristics, where the information submitted to the FDA does not raise
new questions of safety and effectiveness and demonstrates that the device is at least as safe and effective as the
legally marketed device.

The FDA generally issues a decision letter within 90 days of receipt of the 510(k) if it has no additional questions or
sends a first action letter requesting additional information within 75 days. Most 510(k)s do not require clinical data
for clearance, but a minority will. Requests for additional data, including clinical data, will increase the time
necessary to review the notice. If the FDA believes that the device is not substantially equivalent to a predicate
device, it will issue a “Not Substantially Equivalent” (NSE) determination and designate the device as a Class III
device, which will require the submission and approval of a PMA before the new device may be marketed. A person
who receives an NSE determination in response to a 510(k) submission may, within 30 days of receipt of the NSE
determination, submit a de novo request for the FDA to make a risk-based evaluation for classification of the device
into Class I or II. Devices that are classified through the de novo process may be marketed and used as predicates
for future 510(k) submissions. The FDA continues to reevaluate the 510(k) pathway and process and the de novo
process, and has taken what it describes as a risk-based approach to develop innovative regulatory policy to
propose a more "contemporary" approach. In October 2017, the FDA published a final guidance entitled, “De
Novo Classification Process (Evaluation of Automatic Class III Designation)” and in December 2018, the FDA issued
a proposed rule which if finalized is intended to provide structure, clarity and transparency on the de novo
classification process. We cannot predict what if any changes will occur or how they will affect our current or future
products.

. The PMA process is more complex, costly and time consuming than the 510(k) process. A PMA

must be supported by more detailed and comprehensive scientific evidence, including clinical data, to demonstrate
the safety and efficacy of the medical device for its intended purpose. If the device is determined to present a
“significant risk,” the sponsor may not begin a clinical trial until it submits an investigational device exemption (IDE)
to the FDA and obtains approval to begin the trial.

After the PMA is submitted, the FDA has 45 days to make a threshold determination that the PMA is sufficiently
complete to permit a substantive review. If the PMA is complete, the FDA will file the PMA. The FDA is subject to a
performance goal review time for a PMA that is 180 days from the date of filing, although in practice this review
time is longer. Questions from the FDA, requests for additional data and referrals to advisory committees may delay
the process considerably. The total process may take several years and there is no guarantee that the PMA will ever
be approved. Even if approved, the FDA may limit the indications for which the device may be marketed. The FDA
may also request additional clinical data as a condition of approval or after the PMA is approved. Any changes to
the medical device may require a supplemental PMA to be submitted and approved before changed medical device
41
may be marketed.

Any products sold by us pursuant to FDA clearances or approvals will be subject to pervasive and continuing

regulation by the FDA, including record keeping requirements, reporting of adverse experiences with the use of the

device and restrictions on the advertising and promotion of our products. Device manufacturers are required to

register their establishments and list their devices with the FDA and are subject to periodic inspections by the FDA

and certain state agencies. Noncompliance with applicable FDA requirements can result in, among other things,

warning letters, fines, injunctions, civil penalties, recalls or seizures of products, total or partial suspension of

production, refusal of the FDA to grant 510(k) clearance or PMA approval for new devices, withdrawal of 510(k)

clearances and/or PMA approvals and criminal prosecution.

If a sponsor or the FDA believes that a diagnostic test is essential for the safe and effective use of a corresponding

therapeutic product, the sponsor of the therapeutic product will typically work with a collaborator to develop an in

vitro companion diagnostic device, or IVD. IVDs are regulated by the FDA as medical devices. The FDA issued a

final guidance document in 2014, entitled “In Vitro Companion Diagnostic Devices” that is intended to assist

companies developing in vitro companion diagnostic devices and companies developing therapeutic products that

depend on the use of a specific in vitro companion diagnostic for the safe and effective use of the product. The FDA

defined an IVD companion diagnostic device as a device that provides information that is essential for the safe and

effective use of a corresponding therapeutic product. The FDA expects that the therapeutic sponsor will address the

need for an approved or cleared IVD companion diagnostic device in its therapeutic product development plan and

that, in most cases, the therapeutic product and its corresponding IVD companion diagnostic will be developed

contemporaneously.

It also issued a draft guidance on July 15, 2016, entitled, “Principles for Codevelopment of an In Vitro Companion

Diagnostic Device with a Therapeutic Product” to serve as a practical guide to assist therapeutic product sponsors

and IVD sponsors in developing a therapeutic product and an accompanying IVD companion diagnostic and on

December 7, 2018, it published another draft guidance, “Developing and Labeling In Vitro Companion Diagnostic

Devices for a Specific Group or Class of Oncology Therapeutic Products” which, if finalized, is intended to facilitate

class labeling on diagnostic tests for oncology therapeutic products, where scientifically appropriate.

U.S. RegulationsIn Vitro Diagnostics510(k) Premarket NotificationPremarket ApprovalRegulation of Companion Diagnostic Devicesdetermination, submit a de novo request for the FDA to make a risk-based evaluation for classification of the device

into Class I or II. Devices that are classified through the de novo process may be marketed and used as predicates

for future 510(k) submissions. The FDA continues to reevaluate the 510(k) pathway and process and the de novo

process, and has taken what it describes as a risk-based approach to develop innovative regulatory policy to

propose a more "contemporary" approach. In October 2017, the FDA published a final guidance entitled, “De

Novo Classification Process (Evaluation of Automatic Class III Designation)” and in December 2018, the FDA issued

a proposed rule which if finalized is intended to provide structure, clarity and transparency on the de novo

classification process. We cannot predict what if any changes will occur or how they will affect our current or future
products.

. The PMA process is more complex, costly and time consuming than the 510(k) process. A PMA

must be supported by more detailed and comprehensive scientific evidence, including clinical data, to demonstrate
the safety and efficacy of the medical device for its intended purpose. If the device is determined to present a
“significant risk,” the sponsor may not begin a clinical trial until it submits an investigational device exemption (IDE)
to the FDA and obtains approval to begin the trial.

After the PMA is submitted, the FDA has 45 days to make a threshold determination that the PMA is sufficiently
complete to permit a substantive review. If the PMA is complete, the FDA will file the PMA. The FDA is subject to a
performance goal review time for a PMA that is 180 days from the date of filing, although in practice this review
time is longer. Questions from the FDA, requests for additional data and referrals to advisory committees may delay
the process considerably. The total process may take several years and there is no guarantee that the PMA will ever
be approved. Even if approved, the FDA may limit the indications for which the device may be marketed. The FDA
may also request additional clinical data as a condition of approval or after the PMA is approved. Any changes to
the medical device may require a supplemental PMA to be submitted and approved before changed medical device
may be marketed.

Any products sold by us pursuant to FDA clearances or approvals will be subject to pervasive and continuing
regulation by the FDA, including record keeping requirements, reporting of adverse experiences with the use of the
device and restrictions on the advertising and promotion of our products. Device manufacturers are required to
register their establishments and list their devices with the FDA and are subject to periodic inspections by the FDA
and certain state agencies. Noncompliance with applicable FDA requirements can result in, among other things,
warning letters, fines, injunctions, civil penalties, recalls or seizures of products, total or partial suspension of
production, refusal of the FDA to grant 510(k) clearance or PMA approval for new devices, withdrawal of 510(k)
clearances and/or PMA approvals and criminal prosecution.

If a sponsor or the FDA believes that a diagnostic test is essential for the safe and effective use of a corresponding
therapeutic product, the sponsor of the therapeutic product will typically work with a collaborator to develop an in
vitro companion diagnostic device, or IVD. IVDs are regulated by the FDA as medical devices. The FDA issued a
final guidance document in 2014, entitled “In Vitro Companion Diagnostic Devices” that is intended to assist
companies developing in vitro companion diagnostic devices and companies developing therapeutic products that
depend on the use of a specific in vitro companion diagnostic for the safe and effective use of the product. The FDA
defined an IVD companion diagnostic device as a device that provides information that is essential for the safe and
effective use of a corresponding therapeutic product. The FDA expects that the therapeutic sponsor will address the
need for an approved or cleared IVD companion diagnostic device in its therapeutic product development plan and
that, in most cases, the therapeutic product and its corresponding IVD companion diagnostic will be developed
contemporaneously.

It also issued a draft guidance on July 15, 2016, entitled, “Principles for Codevelopment of an In Vitro Companion
Diagnostic Device with a Therapeutic Product” to serve as a practical guide to assist therapeutic product sponsors
and IVD sponsors in developing a therapeutic product and an accompanying IVD companion diagnostic and on
December 7, 2018, it published another draft guidance, “Developing and Labeling In Vitro Companion Diagnostic
Devices for a Specific Group or Class of Oncology Therapeutic Products” which, if finalized, is intended to facilitate
class labeling on diagnostic tests for oncology therapeutic products, where scientifically appropriate.

The FDA also introduced the concept of complementary diagnostics that are distinct from companion diagnostics
because they provide additional information about how a drug is used or identify patients who are likely to derive
the greatest benefit from therapy without being required for the safe and effective use of that drug. The FDA has not
yet provided much guidance on the regulation and use of complementary diagnostics, but several have been
approved.

The FDA indicated that it will apply a risk-based approach to determine the regulatory pathway for IVD companion
diagnostic devices, as it does with all medical devices. This means that the regulatory pathway will depend on the
level of risk to patients, based on the intended use of the IVD companion diagnostic device and the controls
necessary to provide a reasonable assurance of safety and effectiveness. The two primary types of marketing
pathways for medical devices are clearance of a premarket notification under Section 510(k) of the Federal Food,
Drug, and Cosmetic Act, or 510(k), and approval of a premarket approval application, or PMA. We expect that any
IVD companion diagnostic device developed for use with our drug candidates will utilize the PMA pathway and that
a clinical trial performed under an investigational device exemption, or IDE, will have to be completed before the
42
PMA may be submitted.

The FDA expects that the therapeutic sponsor will address the need for an IVD companion diagnostic device in its

therapeutic product development plan and that, in most cases, the therapeutic product and its corresponding IVD

companion diagnostic device will be developed contemporaneously. If the companion diagnostic test will be used to

make critical treatment decisions such as patient selection, treatment assignment, or treatment arm, it will likely be

considered a significant risk device for which a clinical trial will be required.

The sponsor of the IVD companion diagnostic device will be required to comply with the FDA’s IDE requirements that

apply to clinical trials of significant risk devices. If the diagnostic test and the therapeutic drug are studied together to

support their respective approvals, the clinical trial must meet both the IDE and IND requirements.

PMAs must be supported by valid scientific evidence, which typically requires extensive data, including technical,

preclinical, clinical and manufacturing data, to demonstrate to the FDA’s satisfaction the safety and effectiveness of

the device. For diagnostic tests, a PMA typically includes data regarding analytical and clinical validation studies. As

part of its review of the PMA, the FDA will conduct a pre-approval inspection of the manufacturing facility or facilities

to ensure compliance with the Quality System Regulation, or QSR, which requires manufacturers to follow design,

testing, control, documentation and other quality assurance procedures. FDA review of an initial PMA may require

several years to complete.

If the FDA evaluations of both the PMA and the manufacturing facilities are favorable, the FDA will either issue an

approval order or an approvable letter, which usually contains a number of conditions that must be met in order to

secure the final approval of the PMA. If the FDA’s evaluation of the PMA or manufacturing facilities is not favorable,

the FDA will send the applicant a not approvable letter or an order denying approval. A not approvable letter will

outline the deficiencies in the application and, where practical, will identify what is necessary to make the PMA

approvable. The FDA may also determine that additional clinical trials are necessary, in which case the PMA

approval may be delayed for several months or years while the trials are conducted and then the data submitted in

an amendment to the PMA. Once granted, PMA approval may be withdrawn by the FDA if compliance with post

approval requirements, conditions of approval or other regulatory standards is not maintained or problems are

identified following initial marketing.

After approval, the use of an IVD companion diagnostic device with a therapeutic product will be stipulated in the

instructions for use in the labeling of both the diagnostic device and the corresponding therapeutic product. In

addition, a diagnostic test that was approved through the PMA process or one that was cleared through the 510(k)

process and placed on the market will be subject to many of the same regulatory requirements that apply to

approved drugs. The FDA has approved a number of drug/diagnostic device companions in accordance with the

Guidance.

In September 2013, the FDA issued its final rule on the Unique Device Identifier. This rule now requires an additional

registered identifier, including a special barcode, on all FDA regulated medical devices. The rule is implemented in

Premarket ApprovalRegulation of Companion Diagnostic DevicesUnique Device Identifier RequirementsM A N A G E M E N T   R E P O R T

Business and Operating Environment

The FDA also introduced the concept of complementary diagnostics that are distinct from companion diagnostics
because they provide additional information about how a drug is used or identify patients who are likely to derive
the greatest benefit from therapy without being required for the safe and effective use of that drug. The FDA has not
yet provided much guidance on the regulation and use of complementary diagnostics, but several have been
approved.

The FDA indicated that it will apply a risk-based approach to determine the regulatory pathway for IVD companion
diagnostic devices, as it does with all medical devices. This means that the regulatory pathway will depend on the
level of risk to patients, based on the intended use of the IVD companion diagnostic device and the controls
necessary to provide a reasonable assurance of safety and effectiveness. The two primary types of marketing
pathways for medical devices are clearance of a premarket notification under Section 510(k) of the Federal Food,
Drug, and Cosmetic Act, or 510(k), and approval of a premarket approval application, or PMA. We expect that any
IVD companion diagnostic device developed for use with our drug candidates will utilize the PMA pathway and that
a clinical trial performed under an investigational device exemption, or IDE, will have to be completed before the
PMA may be submitted.

The FDA expects that the therapeutic sponsor will address the need for an IVD companion diagnostic device in its
therapeutic product development plan and that, in most cases, the therapeutic product and its corresponding IVD
companion diagnostic device will be developed contemporaneously. If the companion diagnostic test will be used to
make critical treatment decisions such as patient selection, treatment assignment, or treatment arm, it will likely be
considered a significant risk device for which a clinical trial will be required.

The sponsor of the IVD companion diagnostic device will be required to comply with the FDA’s IDE requirements that
apply to clinical trials of significant risk devices. If the diagnostic test and the therapeutic drug are studied together to
support their respective approvals, the clinical trial must meet both the IDE and IND requirements.

PMAs must be supported by valid scientific evidence, which typically requires extensive data, including technical,
preclinical, clinical and manufacturing data, to demonstrate to the FDA’s satisfaction the safety and effectiveness of
the device. For diagnostic tests, a PMA typically includes data regarding analytical and clinical validation studies. As
part of its review of the PMA, the FDA will conduct a pre-approval inspection of the manufacturing facility or facilities
to ensure compliance with the Quality System Regulation, or QSR, which requires manufacturers to follow design,
testing, control, documentation and other quality assurance procedures. FDA review of an initial PMA may require
several years to complete.

If the FDA evaluations of both the PMA and the manufacturing facilities are favorable, the FDA will either issue an
approval order or an approvable letter, which usually contains a number of conditions that must be met in order to
secure the final approval of the PMA. If the FDA’s evaluation of the PMA or manufacturing facilities is not favorable,
the FDA will send the applicant a not approvable letter or an order denying approval. A not approvable letter will
outline the deficiencies in the application and, where practical, will identify what is necessary to make the PMA
approvable. The FDA may also determine that additional clinical trials are necessary, in which case the PMA
approval may be delayed for several months or years while the trials are conducted and then the data submitted in
an amendment to the PMA. Once granted, PMA approval may be withdrawn by the FDA if compliance with post
approval requirements, conditions of approval or other regulatory standards is not maintained or problems are
identified following initial marketing.

After approval, the use of an IVD companion diagnostic device with a therapeutic product will be stipulated in the
instructions for use in the labeling of both the diagnostic device and the corresponding therapeutic product. In
addition, a diagnostic test that was approved through the PMA process or one that was cleared through the 510(k)
process and placed on the market will be subject to many of the same regulatory requirements that apply to
approved drugs. The FDA has approved a number of drug/diagnostic device companions in accordance with the
Guidance.

In September 2013, the FDA issued its final rule on the Unique Device Identifier. This rule now requires an additional
registered identifier, including a special barcode, on all FDA regulated medical devices. The rule is implemented in

43

Unique Device Identifier RequirementsThe FDA also introduced the concept of complementary diagnostics that are distinct from companion diagnostics

because they provide additional information about how a drug is used or identify patients who are likely to derive

the greatest benefit from therapy without being required for the safe and effective use of that drug. The FDA has not

yet provided much guidance on the regulation and use of complementary diagnostics, but several have been

approved.

The FDA indicated that it will apply a risk-based approach to determine the regulatory pathway for IVD companion

diagnostic devices, as it does with all medical devices. This means that the regulatory pathway will depend on the

level of risk to patients, based on the intended use of the IVD companion diagnostic device and the controls

necessary to provide a reasonable assurance of safety and effectiveness. The two primary types of marketing

pathways for medical devices are clearance of a premarket notification under Section 510(k) of the Federal Food,

Drug, and Cosmetic Act, or 510(k), and approval of a premarket approval application, or PMA. We expect that any

IVD companion diagnostic device developed for use with our drug candidates will utilize the PMA pathway and that

a clinical trial performed under an investigational device exemption, or IDE, will have to be completed before the

PMA may be submitted.

The FDA expects that the therapeutic sponsor will address the need for an IVD companion diagnostic device in its

therapeutic product development plan and that, in most cases, the therapeutic product and its corresponding IVD

companion diagnostic device will be developed contemporaneously. If the companion diagnostic test will be used to

make critical treatment decisions such as patient selection, treatment assignment, or treatment arm, it will likely be

considered a significant risk device for which a clinical trial will be required.

The sponsor of the IVD companion diagnostic device will be required to comply with the FDA’s IDE requirements that

apply to clinical trials of significant risk devices. If the diagnostic test and the therapeutic drug are studied together to

support their respective approvals, the clinical trial must meet both the IDE and IND requirements.

PMAs must be supported by valid scientific evidence, which typically requires extensive data, including technical,

preclinical, clinical and manufacturing data, to demonstrate to the FDA’s satisfaction the safety and effectiveness of

the device. For diagnostic tests, a PMA typically includes data regarding analytical and clinical validation studies. As

part of its review of the PMA, the FDA will conduct a pre-approval inspection of the manufacturing facility or facilities

to ensure compliance with the Quality System Regulation, or QSR, which requires manufacturers to follow design,

testing, control, documentation and other quality assurance procedures. FDA review of an initial PMA may require

several years to complete.

If the FDA evaluations of both the PMA and the manufacturing facilities are favorable, the FDA will either issue an

approval order or an approvable letter, which usually contains a number of conditions that must be met in order to

secure the final approval of the PMA. If the FDA’s evaluation of the PMA or manufacturing facilities is not favorable,

the FDA will send the applicant a not approvable letter or an order denying approval. A not approvable letter will

outline the deficiencies in the application and, where practical, will identify what is necessary to make the PMA

approvable. The FDA may also determine that additional clinical trials are necessary, in which case the PMA

approval may be delayed for several months or years while the trials are conducted and then the data submitted in

an amendment to the PMA. Once granted, PMA approval may be withdrawn by the FDA if compliance with post

approval requirements, conditions of approval or other regulatory standards is not maintained or problems are

identified following initial marketing.

After approval, the use of an IVD companion diagnostic device with a therapeutic product will be stipulated in the
instructions for use in the labeling of both the diagnostic device and the corresponding therapeutic product. In
addition, a diagnostic test that was approved through the PMA process or one that was cleared through the 510(k)
process and placed on the market will be subject to many of the same regulatory requirements that apply to
approved drugs. The FDA has approved a number of drug/diagnostic device companions in accordance with the
Guidance.

In September 2013, the FDA issued its final rule on the Unique Device Identifier. This rule now requires an additional
registered identifier, including a special barcode, on all FDA regulated medical devices. The rule is implemented in
phases with the first deadline of September 24, 2014 being established for all Class III medical devices. For
QIAGEN, this impacted the HC2, QuantiFERON, artus, and therascreen products. We established a task force to
ensure that the deadline was met but there is additional administrative and regulatory burden on us related to the
annual reporting of compliance of these products to the new regulation. Class II and Class I products were required
to have this same labeling as of September 24, 2016 and 2018, respectively. QIAGEN was fully compliant with the
new rule by September 2018. The new rule will also require additional compliance oversight now that it has been
implemented. The requirements are now confirmed as part of our annual reporting and PMA submissions. They are
also assessed during site inspections by the U.S. FDA.

Some of our products are sold for research purposes in the U.S., and labeled “For Research Use Only” (RUO) or “for
molecular biology applications.” In November 2013, the FDA issued a final Guidance for Industry and Food and
Drug Administration Staff entitled, “Distribution of In Vitro Diagnostic Products Labeled for Research Use Only or
Investigational Use Only.” In the Guidance, RUO refers to devices that are in the laboratory phase of development,
and investigational use only, or IUO, refers to devices that are in the product testing phase of development. These
types of devices are exempt from most regulatory controls. Because we do not promote our RUOs for clinical
diagnostic use or provide technical assistance to clinical laboratories with respect to these tests, we believe that these
tests are exempt from FDA’s premarket review and other requirements. If the FDA were to disagree with our
designation of any of these products, we could be forced to stop selling the product until we obtain appropriate
regulatory clearance or approval. Further, it is possible that some of our RUOs may be used by some customers
without our knowledge in their LDTs, which they develop, validate and promote for clinical use. However, as
previously noted, we do not promote these products for use in LDTs or assist in the development of the LDTs for
clinical diagnostic use.

The 21st Century Cures Act (Cures Act) was enacted into law on December 13, 2016, after a bipartisan, multi-year
effort. The Cures Act primarily affects activities of the Department of Health and Human Services (HHS) and its
agencies, including the Food and Drug Administration (FDA or the Agency). On June 6, 2017, Scott Gottlieb, M.D.,
Commissioner of Food and Drugs, reported to Congress as required by the Cures Act. This report included the Food
& Drug Administration Work Plan and Proposed Funding Allocations of FDA Innovation Account (Required by
Section 1002 of the 21st Century Cures Act (Public Law 114-255). This is now being implemented with a broad
spectrum of initiatives within the FDA with the goal to support patients with improved and timely access to safe and
efficacious medical products. For industry, it is anticipated that some processes will become less burdensome with
more rapid approval/clearance cycles while others will continue to require significant investment.

Numerous privacy and data security laws apply to personal information, including health information. These laws
vary in their application. For example, the Health Insurance Portability and Accountability Act of 1996, as amended
by the Health Information Technology for Economic and Clinical Health Act, and their implementing regulations
(collectively, HIPAA), regulate the uses, disclosures and security of identifiable health information (protected health
information or PHI) in the hands of certain health care providers, health plans or health care clearing houses
(covered entities). HIPAA regulates and limits covered entities’ uses and disclosures of PHI and requires the
implementation of administrative, physical and technical safeguards to keep PHI secure. HIPAA also applies to
organizations that create, receive, maintain or transmit PHI to provide services to or for or on behalf of covered
entities (business associates). Business associates and certain of their subcontractors are required to comply with
certain privacy and all of the security standards of HIPAA. Business associates and covered entities must also comply
with breach notification standards established by HIPAA. The HIPAA breach notification standards require covered
entities to notify affected individuals, the government, and in some cases, local and national media in the event of a
breach of PHI that has not been secured in accordance with HIPAA standards, such as by encryption. The breach
notification standards require business associates to notify covered entity customers of their own breaches of
unsecured PHI so that the relevant covered entity may make required notifications. In the ordinary course, HIPAA
44
does not apply to us directly, but if we were to act as a HIPAA covered entity or business associate, we would be
subject to these obligations. Most of our institutional and physician customers are covered entities under HIPAA and

must obtain proper authorization, de-identify information or take some other step so that we may provide services

involving PHI. When PHI is de-identified in accordance with HIPAA or when the disclosure of PHI is authorized by a

patient, HIPAA does not impose any compliance obligations on the recipient, but our use and disclosure of the

information may be limited by contract or the terms of the authorization.

Unique Device Identifier RequirementsRegulation of Research Use Only ProductsHIPAA and Other Privacy and Security Lawsphases with the first deadline of September 24, 2014 being established for all Class III medical devices. For

QIAGEN, this impacted the HC2, QuantiFERON, artus, and therascreen products. We established a task force to

ensure that the deadline was met but there is additional administrative and regulatory burden on us related to the

annual reporting of compliance of these products to the new regulation. Class II and Class I products were required

to have this same labeling as of September 24, 2016 and 2018, respectively. QIAGEN was fully compliant with the

new rule by September 2018. The new rule will also require additional compliance oversight now that it has been

implemented. The requirements are now confirmed as part of our annual reporting and PMA submissions. They are

also assessed during site inspections by the U.S. FDA.

Some of our products are sold for research purposes in the U.S., and labeled “For Research Use Only” (RUO) or “for

molecular biology applications.” In November 2013, the FDA issued a final Guidance for Industry and Food and

Drug Administration Staff entitled, “Distribution of In Vitro Diagnostic Products Labeled for Research Use Only or

Investigational Use Only.” In the Guidance, RUO refers to devices that are in the laboratory phase of development,

and investigational use only, or IUO, refers to devices that are in the product testing phase of development. These

types of devices are exempt from most regulatory controls. Because we do not promote our RUOs for clinical

diagnostic use or provide technical assistance to clinical laboratories with respect to these tests, we believe that these

tests are exempt from FDA’s premarket review and other requirements. If the FDA were to disagree with our

designation of any of these products, we could be forced to stop selling the product until we obtain appropriate

regulatory clearance or approval. Further, it is possible that some of our RUOs may be used by some customers

without our knowledge in their LDTs, which they develop, validate and promote for clinical use. However, as

previously noted, we do not promote these products for use in LDTs or assist in the development of the LDTs for

clinical diagnostic use.

The 21st Century Cures Act (Cures Act) was enacted into law on December 13, 2016, after a bipartisan, multi-year

effort. The Cures Act primarily affects activities of the Department of Health and Human Services (HHS) and its

agencies, including the Food and Drug Administration (FDA or the Agency). On June 6, 2017, Scott Gottlieb, M.D.,

Commissioner of Food and Drugs, reported to Congress as required by the Cures Act. This report included the Food

& Drug Administration Work Plan and Proposed Funding Allocations of FDA Innovation Account (Required by

Section 1002 of the 21st Century Cures Act (Public Law 114-255). This is now being implemented with a broad

spectrum of initiatives within the FDA with the goal to support patients with improved and timely access to safe and

efficacious medical products. For industry, it is anticipated that some processes will become less burdensome with

more rapid approval/clearance cycles while others will continue to require significant investment.

Business and Operating Environment

Numerous privacy and data security laws apply to personal information, including health information. These laws
vary in their application. For example, the Health Insurance Portability and Accountability Act of 1996, as amended
by the Health Information Technology for Economic and Clinical Health Act, and their implementing regulations
M A N A G E M E N T   R E P O R T
(collectively, HIPAA), regulate the uses, disclosures and security of identifiable health information (protected health
information or PHI) in the hands of certain health care providers, health plans or health care clearing houses
(covered entities). HIPAA regulates and limits covered entities’ uses and disclosures of PHI and requires the
implementation of administrative, physical and technical safeguards to keep PHI secure. HIPAA also applies to
organizations that create, receive, maintain or transmit PHI to provide services to or for or on behalf of covered
entities (business associates). Business associates and certain of their subcontractors are required to comply with
certain privacy and all of the security standards of HIPAA. Business associates and covered entities must also comply
with breach notification standards established by HIPAA. The HIPAA breach notification standards require covered
entities to notify affected individuals, the government, and in some cases, local and national media in the event of a
breach of PHI that has not been secured in accordance with HIPAA standards, such as by encryption. The breach
notification standards require business associates to notify covered entity customers of their own breaches of
unsecured PHI so that the relevant covered entity may make required notifications. In the ordinary course, HIPAA
does not apply to us directly, but if we were to act as a HIPAA covered entity or business associate, we would be
subject to these obligations. Most of our institutional and physician customers are covered entities under HIPAA and
must obtain proper authorization, de-identify information or take some other step so that we may provide services
involving PHI. When PHI is de-identified in accordance with HIPAA or when the disclosure of PHI is authorized by a
patient, HIPAA does not impose any compliance obligations on the recipient, but our use and disclosure of the
information may be limited by contract or the terms of the authorization.

All 50 states have adopted data breach notification laws relating to the “personal information” of their residents.
Personal information typically includes an individual’s name or initials coupled with social security, financial account,
debit, credit or state-issued identification number or other information that could lead to identity theft. An increasing
number of states are broadly including "health information" as personal information protected under the law. There
is significant variability under these laws, but most require notification to affected individuals and to the government
in the event of breach. Other laws of some states require that that we comply with data security obligations. These
laws may apply to us when we receive or maintain personal information regarding individuals, including our
employees.

We are subject to enforcement by state attorneys general who have authority to enforce state data privacy or
security laws. Accordingly, we maintain an active privacy and data security program designed to address
applicable regulatory compliance requirements.

The Genetic Information Nondiscrimination Act of 2008, also referred to as GINA, is a federal law that protects
individuals from discrimination in the health insurance and employment contexts because of DNA characteristics that
may affect their health. GINA prohibits covered employers from requesting, obtaining, or using employees’ genetic
information (subject to limited exceptions), and prohibits covered health insurers from requesting genetic information
or using any such information they may already have for purposes of making eligibility, premium, or coverage-
related decisions.

Many states have also adopted genetic testing and privacy laws. These laws typically require a specific, written
consent for genetic testing as well as consent for the disclosure of genetic test results and otherwise limit uses and
disclosures of genetic testing results. A few states have adopted laws that give their residents property rights in their
genetic information.

Privacy and data security laws, including those relating to health information, are complex, overlapping and rapidly
evolving. As our activities evolve and expand, additional laws may be implicated. For example, the California
Consumer Privacy Act of 2018, which took effect on January 1, 2020, imposes requirements and protections upon
the processing of personal data, aimed at giving California consumers more visibility and control over their personal
information. There are also non-U.S. privacy laws, such as the General Data Protection Regulation (GDPR) of the
European Union, that impose restrictions on the transfer, access, use, and disclosure of health and other personal
information. We have implemented the requirements set forth by the GDPR, which took effect on May 25, 2018. All
of these laws impact our business either directly or indirectly. Our failure to comply with applicable privacy or
security laws or significant changes in these laws could significantly impact our business and future business plans.
For example, we may be subject to regulatory action or lawsuits in the event we fail to comply with applicable
privacy laws. We may face significant liability in the event any of the personal information we maintain is lost or
otherwise subject to misuse or other wrongful use, access or disclosure.

We have to comply with various U.S. federal and state laws, rules and regulations pertaining to healthcare fraud
and abuse, including anti-kickback laws and physician self-referral laws, rules and regulations. Violations of the
fraud and abuse laws are punishable by criminal and civil sanctions, including, in some instances, exclusion from
participation in federal and state healthcare programs, including Medicare and Medicaid.

45

The federal Anti-Kickback Statute prohibits persons from knowingly or willfully soliciting, receiving, offering or paying

remuneration, directly or indirectly, in exchange for or to induce:

›

The referral of an individual for a service or product for which payment may be made by Medicare, Medicaid or

other government-sponsored healthcare program; or

›

purchasing, ordering, arranging for, or recommending the ordering of, any service or product for which payment

may be made by a government-sponsored healthcare program.

Regulation of Research Use Only ProductsHIPAA and Other Privacy and Security LawsCompliance with Fraud and Abuse LawsAnti-Kickback StatuteAll 50 states have adopted data breach notification laws relating to the “personal information” of their residents.

Personal information typically includes an individual’s name or initials coupled with social security, financial account,

debit, credit or state-issued identification number or other information that could lead to identity theft. An increasing

number of states are broadly including "health information" as personal information protected under the law. There

is significant variability under these laws, but most require notification to affected individuals and to the government

in the event of breach. Other laws of some states require that that we comply with data security obligations. These

laws may apply to us when we receive or maintain personal information regarding individuals, including our

employees.

We are subject to enforcement by state attorneys general who have authority to enforce state data privacy or

security laws. Accordingly, we maintain an active privacy and data security program designed to address

applicable regulatory compliance requirements.

The Genetic Information Nondiscrimination Act of 2008, also referred to as GINA, is a federal law that protects

individuals from discrimination in the health insurance and employment contexts because of DNA characteristics that

may affect their health. GINA prohibits covered employers from requesting, obtaining, or using employees’ genetic

information (subject to limited exceptions), and prohibits covered health insurers from requesting genetic information

or using any such information they may already have for purposes of making eligibility, premium, or coverage-

related decisions.

genetic information.

Many states have also adopted genetic testing and privacy laws. These laws typically require a specific, written

consent for genetic testing as well as consent for the disclosure of genetic test results and otherwise limit uses and

disclosures of genetic testing results. A few states have adopted laws that give their residents property rights in their

Privacy and data security laws, including those relating to health information, are complex, overlapping and rapidly

evolving. As our activities evolve and expand, additional laws may be implicated. For example, the California

Consumer Privacy Act of 2018, which took effect on January 1, 2020, imposes requirements and protections upon

the processing of personal data, aimed at giving California consumers more visibility and control over their personal

information. There are also non-U.S. privacy laws, such as the General Data Protection Regulation (GDPR) of the
European Union, that impose restrictions on the transfer, access, use, and disclosure of health and other personal
information. We have implemented the requirements set forth by the GDPR, which took effect on May 25, 2018. All
of these laws impact our business either directly or indirectly. Our failure to comply with applicable privacy or
security laws or significant changes in these laws could significantly impact our business and future business plans.
For example, we may be subject to regulatory action or lawsuits in the event we fail to comply with applicable
privacy laws. We may face significant liability in the event any of the personal information we maintain is lost or
otherwise subject to misuse or other wrongful use, access or disclosure.

We have to comply with various U.S. federal and state laws, rules and regulations pertaining to healthcare fraud
and abuse, including anti-kickback laws and physician self-referral laws, rules and regulations. Violations of the
fraud and abuse laws are punishable by criminal and civil sanctions, including, in some instances, exclusion from
participation in federal and state healthcare programs, including Medicare and Medicaid.

The federal Anti-Kickback Statute prohibits persons from knowingly or willfully soliciting, receiving, offering or paying
remuneration, directly or indirectly, in exchange for or to induce:

›

›

The referral of an individual for a service or product for which payment may be made by Medicare, Medicaid or
other government-sponsored healthcare program; or

purchasing, ordering, arranging for, or recommending the ordering of, any service or product for which payment
may be made by a government-sponsored healthcare program.

The definition of “remuneration” has been broadly interpreted to include anything of value, including such items as
gifts, certain discounts, waiver of payments, and providing anything at less than its fair market value. In addition,
several courts have interpreted the law to mean that if “one purpose” of an arrangement is intended to induce
referrals, the statute is violated.

The Anti-Kickback Statue is broad and prohibits many arrangements and practices that are lawful in businesses
outside of the healthcare industry. Recognizing that the Anti-Kickback Statute is broad and may technically prohibit
many innocuous or beneficial arrangements, the Office of Inspector General of the Department of Health and Human
Services (OIG) has issued regulations, commonly known as "safe harbors." These safe harbors set forth certain
requirements that, if fully met, will insulate healthcare providers, medical device manufacturers, and others, from
prosecution under the Anti-Kickback Statute. Although full compliance with these safe harbor provisions ensures
against prosecution under the Anti-Kickback Statute, full compliance is often difficult and the failure of a transaction
or arrangement to fit within a specific safe harbor does not necessarily mean that the transaction or arrangement is
illegal or that prosecution under the Anti-Kickback Statute will be pursued. However, conduct and business
arrangements that do not fully satisfy each applicable safe harbor may result in increased scrutiny by government
enforcement authorities such as the OIG. The statutory penalties for violating the Anti-Kickback Statute include
imprisonment for up to five years and criminal fines of up to $25,000 per violation. In addition, through application
of other laws, conduct that violates the Anti-Kickback Statute can also give rise to False Claims Act lawsuits, civil
monetary penalties and possible exclusion from Medicare and Medicaid and other federal healthcare programs. In
addition to the Federal Anti-Kickback Statute, many states have their own kickback laws. Often, these laws closely
follow the language of the federal law, although they do not always have the same scope, exceptions, safe harbors
or sanctions. In some states, these anti-kickback laws apply not only to payment made by a government health care
program but also with respect to other payors, including commercial insurance companies.

We have and may in the future, enter into various agreements with health care providers who perform services for
us, including some who make clinical decisions to use our products. All such arrangements have been structured with
the intention of complying with all applicable fraud and abuse laws, including the Anti-Kickback Statute.

The federal False Claims Act (FCA) prohibits any person from knowingly presenting, or causing to be presented, a
false claim or knowingly making, or causing to be made, a false statement to obtain payment from the federal
government. Those found in violation of the FCA can be subject to fines and penalties of three times the damages
sustained by the government, plus mandatory civil penalties of between $5,500 and $11,000 for each separate
false claim. Actions filed under the FCA can be brought by any individual on behalf of the government, a "qui tam"
action, and such individual, known as a "relator" or, more commonly, as a "whistleblower," who may share in any
amounts paid by the entity to the government in damages and penalties or by way of settlement. In addition, certain
46
states have enacted laws modeled after the FCA, and this legislative activity is expected to increase. Qui tam actions
have increased significantly in recent years, causing greater numbers of healthcare companies, including medical

device manufacturers, to defend false claim actions, pay damages and penalties or be excluded from Medicare,

Medicaid or other federal or state healthcare programs as a result of investigations arising out of such actions.

The federal ban on physician self-referrals, commonly known as the Stark Law, prohibits, subject to certain

exceptions, physician referrals of Medicare and Medicaid patients to an entity providing certain “designated health

services” if the physician or an immediate family member of the physician has any financial relationship with the

entity. Penalties for violating the Stark Law include fines, civil monetary penalties and possible exclusion from federal

healthcare programs. In addition to the Stark Law, many states have their own self-referral laws. Often, these laws

closely follow the language of the federal law, although they do not always have the same scope, exceptions or safe

harbors.

The anti-inducement law (Section 1128A(a)(5) of the Social Security Act), prohibits providers from offering anything

of value to a Medicare or Medicaid beneficiary to induce the beneficiary to use items or services covered by either

program. Additionally, the Civil Monetary Penalties Law (Section 1128A of the Social Security Act), authorizes the

United States Department of Health and Human Services to impose civil penalties administratively for various

fraudulent or abusive acts.

Compliance with Fraud and Abuse LawsAnti-Kickback StatuteOther Fraud and Abuse LawsThe definition of “remuneration” has been broadly interpreted to include anything of value, including such items as

gifts, certain discounts, waiver of payments, and providing anything at less than its fair market value. In addition,

several courts have interpreted the law to mean that if “one purpose” of an arrangement is intended to induce

referrals, the statute is violated.

The Anti-Kickback Statue is broad and prohibits many arrangements and practices that are lawful in businesses

outside of the healthcare industry. Recognizing that the Anti-Kickback Statute is broad and may technically prohibit

many innocuous or beneficial arrangements, the Office of Inspector General of the Department of Health and Human

Services (OIG) has issued regulations, commonly known as "safe harbors." These safe harbors set forth certain

requirements that, if fully met, will insulate healthcare providers, medical device manufacturers, and others, from

prosecution under the Anti-Kickback Statute. Although full compliance with these safe harbor provisions ensures

against prosecution under the Anti-Kickback Statute, full compliance is often difficult and the failure of a transaction

or arrangement to fit within a specific safe harbor does not necessarily mean that the transaction or arrangement is

illegal or that prosecution under the Anti-Kickback Statute will be pursued. However, conduct and business

arrangements that do not fully satisfy each applicable safe harbor may result in increased scrutiny by government

enforcement authorities such as the OIG. The statutory penalties for violating the Anti-Kickback Statute include

imprisonment for up to five years and criminal fines of up to $25,000 per violation. In addition, through application

of other laws, conduct that violates the Anti-Kickback Statute can also give rise to False Claims Act lawsuits, civil

monetary penalties and possible exclusion from Medicare and Medicaid and other federal healthcare programs. In

addition to the Federal Anti-Kickback Statute, many states have their own kickback laws. Often, these laws closely
follow the language of the federal law, although they do not always have the same scope, exceptions, safe harbors
or sanctions. In some states, these anti-kickback laws apply not only to payment made by a government health care
M A N A G E M E N T   R E P O R T
program but also with respect to other payors, including commercial insurance companies.

Business and Operating Environment

We have and may in the future, enter into various agreements with health care providers who perform services for
us, including some who make clinical decisions to use our products. All such arrangements have been structured with
the intention of complying with all applicable fraud and abuse laws, including the Anti-Kickback Statute.

The federal False Claims Act (FCA) prohibits any person from knowingly presenting, or causing to be presented, a
false claim or knowingly making, or causing to be made, a false statement to obtain payment from the federal
government. Those found in violation of the FCA can be subject to fines and penalties of three times the damages
sustained by the government, plus mandatory civil penalties of between $5,500 and $11,000 for each separate
false claim. Actions filed under the FCA can be brought by any individual on behalf of the government, a "qui tam"
action, and such individual, known as a "relator" or, more commonly, as a "whistleblower," who may share in any
amounts paid by the entity to the government in damages and penalties or by way of settlement. In addition, certain
states have enacted laws modeled after the FCA, and this legislative activity is expected to increase. Qui tam actions
have increased significantly in recent years, causing greater numbers of healthcare companies, including medical
device manufacturers, to defend false claim actions, pay damages and penalties or be excluded from Medicare,
Medicaid or other federal or state healthcare programs as a result of investigations arising out of such actions.

The federal ban on physician self-referrals, commonly known as the Stark Law, prohibits, subject to certain
exceptions, physician referrals of Medicare and Medicaid patients to an entity providing certain “designated health
services” if the physician or an immediate family member of the physician has any financial relationship with the
entity. Penalties for violating the Stark Law include fines, civil monetary penalties and possible exclusion from federal
healthcare programs. In addition to the Stark Law, many states have their own self-referral laws. Often, these laws
closely follow the language of the federal law, although they do not always have the same scope, exceptions or safe
harbors.

The anti-inducement law (Section 1128A(a)(5) of the Social Security Act), prohibits providers from offering anything
of value to a Medicare or Medicaid beneficiary to induce the beneficiary to use items or services covered by either
program. Additionally, the Civil Monetary Penalties Law (Section 1128A of the Social Security Act), authorizes the
United States Department of Health and Human Services to impose civil penalties administratively for various
fraudulent or abusive acts.

The OIG also has authority to bring administrative actions against entities for alleged violations of a number of
prohibitions, including the Anti-Kickback Statute and the Stark Law. The OIG may seek to impose civil monetary
penalties or exclusion from the Medicare, Medicaid and other federal healthcare programs. Civil monetary penalties
can range from $2,000 to $50,000 for each violation or failure plus, in certain circumstances, three times the
amounts claimed in reimbursement or illegal remuneration. Typically, exclusions last for five years.

In addition, we must comply with a variety of other laws, such as laws prohibiting false claims for reimbursement
under Medicare and Medicaid, all of which can also be triggered by violations of federal anti-kickback laws; the
Health Insurance Portability and Accounting Act of 1996, which makes it a federal crime to commit healthcare fraud
and make false statements; and the Federal Trade Commission Act and similar laws regulating advertisement and
consumer protections.

There are also an increasing number of state “sunshine” laws that require manufacturers to provide reports to state
governments on pricing and marketing information. Several states have enacted legislation requiring manufacturers,
including medical device companies to, among other things, establish marketing compliance programs, file periodic
reports with the state, make periodic public disclosures on sales and marketing activities, and to prohibit or limit
certain other sales and marketing practices. In addition, a federal law known as the Physician Payments Sunshine
Act, requires manufacturers, including medical device manufacturers, to track and report to the federal government
certain payments and other transfers of value made to physicians and teaching hospitals and ownership or
investment interests held by physicians and their immediate family members. The federal government discloses the
reported information on a publicly available website. If we fail to track and report as required by these laws or to
otherwise comply with these laws, we could be subject to the penalty provisions of the pertinent state and federal
authorities.

Despite extensive procedures to ensure compliance, we may also be exposed to liabilities under the U.S. Foreign
Corrupt Practices Act, or FCPA, which generally prohibits companies and their intermediaries from making corrupt
payments to foreign officials for the purpose of obtaining or maintaining business or otherwise obtaining favorable
treatment, and requires companies to maintain adequate record-keeping and internal accounting practices to

47

accurately reflect the transactions of the company. We are also subject to a number of other laws and regulations

relating to money laundering, international money transfers and electronic fund transfers. These laws apply to

companies, individual directors, officers, employees and agents.

We are subject to laws and regulations related to the protection of the environment, the health and safety of

employees and the handling, transportation and disposal of medical specimens, infectious and hazardous waste and

radioactive materials. For example, the U.S. Occupational Safety and Health Administration (OSHA) has established

extensive requirements relating specifically to workplace safety for healthcare employers in the U.S. This includes

requirements to develop and implement multi-faceted programs to protect workers from exposure to blood-borne

pathogens, such as HIV and hepatitis B and C, including preventing or minimizing any exposure through needle stick

injuries. For purposes of transportation, some biological materials and laboratory supplies are classified as

hazardous materials and are subject to regulation by one or more of the following agencies: the U.S. Department of

Transportation, the U.S. Public Health Service, the United States Postal Service and the International Air Transport

Association.

In many countries outside of the United States and the EU, coverage, pricing and reimbursement approvals are also

required. Additionally, many of the major markets are adopting regulations and requirements similar to U.S. Food

and Drug Administration (FDA) which require additional submission activities and management of country specific

regulatory requirements. This is being led by the International Medical Device Regulators Forum (IMDRF). This Forum

consists of regulators from around the world that have signed governmental agreements to align global regulations,

especially around submissions and approvals. In the long term this holds the promise of reducing volatility and

complexity in the regulatory landscape.

Other Fraud and Abuse LawsEnvironment, Health and SafetyOther Country Specific RequirementsReimbursementThe OIG also has authority to bring administrative actions against entities for alleged violations of a number of

prohibitions, including the Anti-Kickback Statute and the Stark Law. The OIG may seek to impose civil monetary

penalties or exclusion from the Medicare, Medicaid and other federal healthcare programs. Civil monetary penalties

can range from $2,000 to $50,000 for each violation or failure plus, in certain circumstances, three times the

amounts claimed in reimbursement or illegal remuneration. Typically, exclusions last for five years.

In addition, we must comply with a variety of other laws, such as laws prohibiting false claims for reimbursement

under Medicare and Medicaid, all of which can also be triggered by violations of federal anti-kickback laws; the

Health Insurance Portability and Accounting Act of 1996, which makes it a federal crime to commit healthcare fraud

and make false statements; and the Federal Trade Commission Act and similar laws regulating advertisement and

consumer protections.

There are also an increasing number of state “sunshine” laws that require manufacturers to provide reports to state

governments on pricing and marketing information. Several states have enacted legislation requiring manufacturers,

including medical device companies to, among other things, establish marketing compliance programs, file periodic
reports with the state, make periodic public disclosures on sales and marketing activities, and to prohibit or limit
certain other sales and marketing practices. In addition, a federal law known as the Physician Payments Sunshine
Act, requires manufacturers, including medical device manufacturers, to track and report to the federal government
certain payments and other transfers of value made to physicians and teaching hospitals and ownership or
investment interests held by physicians and their immediate family members. The federal government discloses the
reported information on a publicly available website. If we fail to track and report as required by these laws or to
otherwise comply with these laws, we could be subject to the penalty provisions of the pertinent state and federal
authorities.

Despite extensive procedures to ensure compliance, we may also be exposed to liabilities under the U.S. Foreign
Corrupt Practices Act, or FCPA, which generally prohibits companies and their intermediaries from making corrupt
payments to foreign officials for the purpose of obtaining or maintaining business or otherwise obtaining favorable
treatment, and requires companies to maintain adequate record-keeping and internal accounting practices to
accurately reflect the transactions of the company. We are also subject to a number of other laws and regulations
relating to money laundering, international money transfers and electronic fund transfers. These laws apply to
companies, individual directors, officers, employees and agents.

We are subject to laws and regulations related to the protection of the environment, the health and safety of
employees and the handling, transportation and disposal of medical specimens, infectious and hazardous waste and
radioactive materials. For example, the U.S. Occupational Safety and Health Administration (OSHA) has established
extensive requirements relating specifically to workplace safety for healthcare employers in the U.S. This includes
requirements to develop and implement multi-faceted programs to protect workers from exposure to blood-borne
pathogens, such as HIV and hepatitis B and C, including preventing or minimizing any exposure through needle stick
injuries. For purposes of transportation, some biological materials and laboratory supplies are classified as
hazardous materials and are subject to regulation by one or more of the following agencies: the U.S. Department of
Transportation, the U.S. Public Health Service, the United States Postal Service and the International Air Transport
Association.

In many countries outside of the United States and the EU, coverage, pricing and reimbursement approvals are also
required. Additionally, many of the major markets are adopting regulations and requirements similar to U.S. Food
and Drug Administration (FDA) which require additional submission activities and management of country specific
regulatory requirements. This is being led by the International Medical Device Regulators Forum (IMDRF). This Forum
consists of regulators from around the world that have signed governmental agreements to align global regulations,
especially around submissions and approvals. In the long term this holds the promise of reducing volatility and
complexity in the regulatory landscape.

In the United States, payments for diagnostic tests come from several sources, including third party payors such as
health maintenance organizations and preferred provider organizations; government health care programs such as
Medicare or Medicaid; and, in most cases the patients themselves. For many years, federal and state governments in
the United States have pursued methods to reduce the cost of healthcare delivery. For example, in 2010, the United
States enacted major healthcare reform legislation known as the Patient Protection and Affordable Care Act (ACA).
Such changes have had, and are expected to continue to have, an impact on our business. At present, Medicare
payment rates are affected by across-the-board federal budget cuts commonly referred to as “sequestration.” Under
sequestration, the Centers for Medicare & Medicaid Services (CMS), the federal agency responsible for
administering Medicare and Medicaid, reduced Medicare payments to providers by 2% annually beginning in
2013 and through 2023.

We frequently identify value propositions on our products and communicate them to payors, providers, and patient
stakeholders and attempt to positively impact coverage, coding and payment pathways. However, we have no direct
control over payor decisions with respect to coverage and payment levels for our products. The manner and level of
reimbursement may depend on the site of care, the procedure(s) performed, the final patient diagnosis, the device(s)
and/or drug(s) utilized, the available budget, or a combination of these factors, and coverage and payment levels
are determined at each payor’s discretion. Changes in reimbursement levels or methods may positively or negatively
affect sales of our products in any given country for any given product. At QIAGEN, we work with several
specialized reimbursement consulting companies and maintain regular contact with payors.

48
As government programs seek to expand healthcare coverage for their citizens, they have at the same time sought to
control costs by limiting the amount of reimbursement they will pay for particular procedures, products or services.

Many third-party payors have developed payment and delivery mechanisms to support cost control efforts and to

focus on paying for quality. Such mechanisms include payment reductions, pay for performance metrics, quality-

based performance payments, restrictive coverage policies, studies to compare effectiveness and patient outcomes,

and technology assessments. These changes have increased emphasis on the delivery of more cost-effective and

quality-driven healthcare.

Code Assignment

In the United States, a third-party payor's decisions regarding coverage and payment are impacted, in large part, by

the specific Current Procedural Terminology, or CPT, code used to identify a test. The American Medical Association,

or AMA, publishes the CPT, which identifies codes, along with descriptions, for reporting medical services and

procedures. The purpose of the CPT is to provide a uniform language that accurately describes medical, surgical,

and diagnostic services and therefore to ensure reliable nationwide communication among healthcare providers,

patients, and third-party payors. CMS uses its own HCPCS codes for medical billing and reimbursement purposes.

Level I HCPCS codes reflect current CPT codes, while Level II codes primarily represent non-physician services and

Level III codes are local codes developed by Medicaid agencies, Medicare contractors and private insurers.

Proprietary Laboratory Analyses (PLA) Codes are an addition to the CPT®  code set approved by the AMA CPT®

Editorial Panel. They are alpha-numeric CPT codes with a corresponding descriptor for labs or manufacturers that

want to more specifically identify their test.

A manufacturer of in vitro diagnostic kits or a provider of laboratory services may request establishment of a

Category I CPT code for a new product or the PLA Code or both. In addition, Z-Code identifiers are unique five-

character alphanumeric tracking codes associated with a specific molecular diagnostic test. When a claim is

submitted, it includes the associated CPT code and the Z-Code identifier is entered as a device code. Assignment of

a specific CPT code ensures routine processing and payment for a diagnostic test by both private and government

third-party payors.

the test.

The AMA has specific procedures for establishing a new CPT code and, if appropriate, for modifying existing

nomenclature to incorporate a new test into an existing code. If the AMA concludes that a new code or modification

of nomenclature is unnecessary, the AMA will inform the requestor how to use one or more existing codes to report

Environment, Health and SafetyOther Country Specific RequirementsReimbursementUnited StatesIn the United States, payments for diagnostic tests come from several sources, including third party payors such as

Business and Operating Environment

health maintenance organizations and preferred provider organizations; government health care programs such as
Medicare or Medicaid; and, in most cases the patients themselves. For many years, federal and state governments in
the United States have pursued methods to reduce the cost of healthcare delivery. For example, in 2010, the United
M A N A G E M E N T   R E P O R T
States enacted major healthcare reform legislation known as the Patient Protection and Affordable Care Act (ACA).
Such changes have had, and are expected to continue to have, an impact on our business. At present, Medicare
payment rates are affected by across-the-board federal budget cuts commonly referred to as “sequestration.” Under
sequestration, the Centers for Medicare & Medicaid Services (CMS), the federal agency responsible for
administering Medicare and Medicaid, reduced Medicare payments to providers by 2% annually beginning in
2013 and through 2023.

We frequently identify value propositions on our products and communicate them to payors, providers, and patient
stakeholders and attempt to positively impact coverage, coding and payment pathways. However, we have no direct
control over payor decisions with respect to coverage and payment levels for our products. The manner and level of
reimbursement may depend on the site of care, the procedure(s) performed, the final patient diagnosis, the device(s)
and/or drug(s) utilized, the available budget, or a combination of these factors, and coverage and payment levels
are determined at each payor’s discretion. Changes in reimbursement levels or methods may positively or negatively
affect sales of our products in any given country for any given product. At QIAGEN, we work with several
specialized reimbursement consulting companies and maintain regular contact with payors.

As government programs seek to expand healthcare coverage for their citizens, they have at the same time sought to
control costs by limiting the amount of reimbursement they will pay for particular procedures, products or services.
Many third-party payors have developed payment and delivery mechanisms to support cost control efforts and to
focus on paying for quality. Such mechanisms include payment reductions, pay for performance metrics, quality-
based performance payments, restrictive coverage policies, studies to compare effectiveness and patient outcomes,
and technology assessments. These changes have increased emphasis on the delivery of more cost-effective and
quality-driven healthcare.

Code Assignment
In the United States, a third-party payor's decisions regarding coverage and payment are impacted, in large part, by
the specific Current Procedural Terminology, or CPT, code used to identify a test. The American Medical Association,
or AMA, publishes the CPT, which identifies codes, along with descriptions, for reporting medical services and
procedures. The purpose of the CPT is to provide a uniform language that accurately describes medical, surgical,
and diagnostic services and therefore to ensure reliable nationwide communication among healthcare providers,
patients, and third-party payors. CMS uses its own HCPCS codes for medical billing and reimbursement purposes.
Level I HCPCS codes reflect current CPT codes, while Level II codes primarily represent non-physician services and
Level III codes are local codes developed by Medicaid agencies, Medicare contractors and private insurers.
Proprietary Laboratory Analyses (PLA) Codes are an addition to the CPT®  code set approved by the AMA CPT®
Editorial Panel. They are alpha-numeric CPT codes with a corresponding descriptor for labs or manufacturers that
want to more specifically identify their test.

A manufacturer of in vitro diagnostic kits or a provider of laboratory services may request establishment of a
Category I CPT code for a new product or the PLA Code or both. In addition, Z-Code identifiers are unique five-
character alphanumeric tracking codes associated with a specific molecular diagnostic test. When a claim is
submitted, it includes the associated CPT code and the Z-Code identifier is entered as a device code. Assignment of
a specific CPT code ensures routine processing and payment for a diagnostic test by both private and government
third-party payors.

The AMA has specific procedures for establishing a new CPT code and, if appropriate, for modifying existing
nomenclature to incorporate a new test into an existing code. If the AMA concludes that a new code or modification
of nomenclature is unnecessary, the AMA will inform the requestor how to use one or more existing codes to report
the test.

While the AMA's decision is pending, billing and collection may be sought under an existing, non-specific CPT code.
A manufacturer or provider may decide not to request assignment of a CPT code and instead use an existing, non-
specific code for reimbursement purposes. However, use of such codes may result in more frequent denials and/or
requests for supporting clinical documentation from the third-party payor and in lower reimbursement rates, which
may vary based on geographical location.

CMS reimbursement rates for clinical diagnostic tests are defined by CPT and HCPS codes in the Clinical Laboratory
Fee Schedule (CLFS). In 2012, the AMA added 127 new CPT codes for molecular pathology services that became
effective on January 1, 2013. These new CPT codes are biomarker specific and were designed to replace the
previous methodology of billing for molecular pathology testing, which involved “stacking” a series of non-biomarker
49
specific CPT codes together to describe the testing performed. CMS issued final national reimbursement prices for the
new CPT codes in November 2013. These federal reimbursement amounts are widely acknowledged to be lower

than the reimbursement obtained by the now outdated “stacking” method, but commercial insurers and Medicare

contractors are still in the process of solidifying their coverage and reimbursement policies for the testing described

by these new CPT codes.

As of January 1, 2018, in accordance with the Protecting Access to Medicare Act of 2014 (PAMA), CMS began

calculating Medicare reimbursement rates for certain clinical diagnostic tests using weighted median private payor

rates, which are based on rate information reported by applicable laboratories. This new rate methodology means

the lower reimbursement rates previously experienced in the field of molecular pathology testing now extends to

additional diagnostic testing codes on the CLFS. On December 20, 2019, the President signed the Further

Consolidated Appropriations Act, which included the Laboratory Access for Beneficiaries Act, or the LAB Act. The

LAB Act delays by one year the reporting of payment data under PAMA for clinical laboratory diagnostic tests that

are not advanced diagnostic laboratory tests. CDLT data for the collection period of January 1, 2019 through June

30, 2019, which was supposed to be reported in 2020, must now be reported between January 1, 2021 and

March 31, 2021. Data reporting will then resume on a three-year cycle beginning in 2024. Under PAMA, as

amended by the LAB Act, any reduction to a particular payment rate resulting from the new methodology is limited to

10% per test per year in 2020 and to 15% per test per year in each of the years 2021 through 2023.

Coverage Decisions

When deciding whether to cover a particular diagnostic test, private and government third-party payors generally

consider whether the test is a medically necessary and, if so, whether the test will directly impact clinical decision

making. For coverage, the testing method should be considered scientifically valid to identify the specific gene

biomarker or gene mutation, and must have been demonstrated to improve clinical outcomes for the patient’s

condition. Coverage of a drug therapy and its companion diagnostic are usually validated by a NCCN category 1,

2A or 2B recommendation. However, most third-party payors do not cover experimental services. Coverage

determinations are often influenced by current standards of practice and clinical data, particularly at the local level.

CMS has the authority to make coverage determinations on a national basis, but most Medicare coverage decisions

are made at the local level by contractors that administer the Medicare program in specified geographic areas.

Private and government third-party payors have separate processes for making coverage determinations, and private

third-party payors may or may not follow Medicare's coverage decisions. If a third-party payor has a coverage

determination in place for a particular diagnostic test, billing for that test must comply with the established policy.

Otherwise, the third-party payor makes reimbursement decisions on a case-by-case basis.

Payment

Payment for covered diagnostic tests is determined based on various methodologies, including prospective payment

systems and fee schedules. In addition, private third-party payors may negotiate contractual rates with participating

providers, establish fee schedule rates, or set rates as a percentage of the billed charge. Diagnostic tests furnished to

Medicare inpatients generally are included in the bundled payment made to the hospital under Medicare's Inpatient

Prospective Payment System, utilizing Diagnosis Related Groups (DRGs) depending on the patient’s condition.

Payment rates for diagnostic tests furnished to Medicare beneficiaries in outpatient settings are the lesser of the

amount billed, the local fee for a geographic area, or a national limit. Each year, the fee schedule is updated for

inflation and could be modified by Congress in accordance with the CLFS rules and provisions. Medicaid programs

generally pay for diagnostic tests based on a fee schedule, but reimbursement varies by geographic region.

United StatesWhile the AMA's decision is pending, billing and collection may be sought under an existing, non-specific CPT code.
A manufacturer or provider may decide not to request assignment of a CPT code and instead use an existing, non-
specific code for reimbursement purposes. However, use of such codes may result in more frequent denials and/or
requests for supporting clinical documentation from the third-party payor and in lower reimbursement rates, which
may vary based on geographical location.

CMS reimbursement rates for clinical diagnostic tests are defined by CPT and HCPS codes in the Clinical Laboratory
Fee Schedule (CLFS). In 2012, the AMA added 127 new CPT codes for molecular pathology services that became
effective on January 1, 2013. These new CPT codes are biomarker specific and were designed to replace the
previous methodology of billing for molecular pathology testing, which involved “stacking” a series of non-biomarker
specific CPT codes together to describe the testing performed. CMS issued final national reimbursement prices for the
new CPT codes in November 2013. These federal reimbursement amounts are widely acknowledged to be lower
than the reimbursement obtained by the now outdated “stacking” method, but commercial insurers and Medicare
contractors are still in the process of solidifying their coverage and reimbursement policies for the testing described
by these new CPT codes.

As of January 1, 2018, in accordance with the Protecting Access to Medicare Act of 2014 (PAMA), CMS began
calculating Medicare reimbursement rates for certain clinical diagnostic tests using weighted median private payor
rates, which are based on rate information reported by applicable laboratories. This new rate methodology means
the lower reimbursement rates previously experienced in the field of molecular pathology testing now extends to
additional diagnostic testing codes on the CLFS. On December 20, 2019, the President signed the Further
Consolidated Appropriations Act, which included the Laboratory Access for Beneficiaries Act, or the LAB Act. The
LAB Act delays by one year the reporting of payment data under PAMA for clinical laboratory diagnostic tests that
are not advanced diagnostic laboratory tests. CDLT data for the collection period of January 1, 2019 through June
30, 2019, which was supposed to be reported in 2020, must now be reported between January 1, 2021 and
March 31, 2021. Data reporting will then resume on a three-year cycle beginning in 2024. Under PAMA, as
amended by the LAB Act, any reduction to a particular payment rate resulting from the new methodology is limited to
10% per test per year in 2020 and to 15% per test per year in each of the years 2021 through 2023.

Coverage Decisions
When deciding whether to cover a particular diagnostic test, private and government third-party payors generally
consider whether the test is a medically necessary and, if so, whether the test will directly impact clinical decision
making. For coverage, the testing method should be considered scientifically valid to identify the specific gene
biomarker or gene mutation, and must have been demonstrated to improve clinical outcomes for the patient’s
condition. Coverage of a drug therapy and its companion diagnostic are usually validated by a NCCN category 1,
2A or 2B recommendation. However, most third-party payors do not cover experimental services. Coverage
determinations are often influenced by current standards of practice and clinical data, particularly at the local level.
CMS has the authority to make coverage determinations on a national basis, but most Medicare coverage decisions
are made at the local level by contractors that administer the Medicare program in specified geographic areas.
Private and government third-party payors have separate processes for making coverage determinations, and private
third-party payors may or may not follow Medicare's coverage decisions. If a third-party payor has a coverage
determination in place for a particular diagnostic test, billing for that test must comply with the established policy.
Otherwise, the third-party payor makes reimbursement decisions on a case-by-case basis.

Payment
Payment for covered diagnostic tests is determined based on various methodologies, including prospective payment
systems and fee schedules. In addition, private third-party payors may negotiate contractual rates with participating
providers, establish fee schedule rates, or set rates as a percentage of the billed charge. Diagnostic tests furnished to
Medicare inpatients generally are included in the bundled payment made to the hospital under Medicare's Inpatient
Prospective Payment System, utilizing Diagnosis Related Groups (DRGs) depending on the patient’s condition.
Payment rates for diagnostic tests furnished to Medicare beneficiaries in outpatient settings are the lesser of the
amount billed, the local fee for a geographic area, or a national limit. Each year, the fee schedule is updated for
inflation and could be modified by Congress in accordance with the CLFS rules and provisions. Medicaid programs
generally pay for diagnostic tests based on a fee schedule, but reimbursement varies by geographic region.

50

M A N A G E M E N T   R E P O R T

Business and Operating Environment

In the European Union, the reimbursement mechanisms used by private and public health insurers vary by country.
For the public systems, reimbursement is determined by guidelines established by the legislator or responsible
national authority. As elsewhere, inclusion in reimbursement catalogues focuses on the medical usefulness, need,
quality and economic benefits to patients and the healthcare system. Acceptance for reimbursement comes with cost,
use, and often volume restrictions, which again can vary by country.

QIAGEN N.V. is the holding company for more than 50 consolidated subsidiaries, many of which have the primary
function of distributing our products and services on a regional basis. Certain subsidiaries also have research and
development or production activities. A listing of our significant subsidiaries and their jurisdictions of incorporation is
included in Exhibit 8.1 to this Annual Report.

Our production and manufacturing facilities for consumable products are located in Germany, the United States and
China. Our facilities for software development are located in the United States, Germany, Poland, Denmark and
Romania. In recent years, we have made investments in automated and interchangeable production equipment to
increase our production capacity and improve efficiency. Our production and manufacturing operations are highly
integrated and benefit from sophisticated inventory control. Production management personnel are highly qualified,
and many have advanced degrees in engineering, business and science. We also have installed and continue to
expand production-planning systems that are included in our integrated information and control system based on the
SAP R/3 business software package from SAP AG. Worldwide, we use SAP software to integrate most of our
operating subsidiaries. Capital expenditures for property, plant and equipment totaled $118.0 million, $109.8
million and $90.1 million for 2019, 2018 and 2017, respectively.

We have an established quality system, including standard manufacturing and documentation procedures, intended
to ensure that products are produced and tested in accordance with the FDA's Quality System Regulations, which
impose current Good Manufacturing Practice (cGMP) requirements. For cGMP production, special areas were built in
our facilities in Hilden, Germany, Germantown, Maryland and Shenzhen, China. These facilities operate in
accordance with cGMP requirements.

The consumable products manufactured at QIAGEN GmbH in Germany, and QIAGEN Sciences LLC in Maryland,
are produced under ISO 9001: 2008, ISO 13485:2012, ISO 13485:2003 CMDCAS. Our certifications form part
of our ongoing commitment to provide our customers with high-quality, state-of-the-art sample and assay technologies
under our Total Quality Management system.

Our facilities in Hilden, Germany, currently occupy a total of approximately 786,000 square feet. Our most recent
expansion to these facilities was in 2018 and included approximately 6,400 square feet of clean room space for
Stat-DX integration. Our production capacity is increased through our manufacturing and research facilities in the
United States. QIAGEN Sciences, LLC owns a 24-acre site in Germantown, Maryland. The 285,000 square foot
Germantown facility consists of several buildings in a campus-like arrangement and can accommodate over 500
employees. There is room for future expansion of up to 300,000 square feet of facility space.

We lease facilities in Frederick, Maryland comprising 42,000 square feet for manufacturing, warehousing,
distribution and research operations and also facilities in Beverly, Massachusetts with 44,000 square feet for enzyme
manufacturing. Additionally, we have leased facilities in Redwood City, California with 12,700 square feet for
digital insights and 19,000 square feet in Minden, Nevada for Service Solutions. We have shared service centers
which lease facilities in Wroclaw, Poland (48,600 square feet) and Manila, Philippines (29,300 square feet).
Additionally, we lease facilities in Shenzhen, China and Manchester, United Kingdom for research operations. Other
subsidiaries throughout the world lease smaller amounts of space. Our corporate headquarters are located in leased
office space in Venlo, The Netherlands.

51

European UnionOrganizational StructureDescription of PropertyIn the European Union, the reimbursement mechanisms used by private and public health insurers vary by country.

For the public systems, reimbursement is determined by guidelines established by the legislator or responsible

national authority. As elsewhere, inclusion in reimbursement catalogues focuses on the medical usefulness, need,

quality and economic benefits to patients and the healthcare system. Acceptance for reimbursement comes with cost,

use, and often volume restrictions, which again can vary by country.

QIAGEN N.V. is the holding company for more than 50 consolidated subsidiaries, many of which have the primary

function of distributing our products and services on a regional basis. Certain subsidiaries also have research and

development or production activities. A listing of our significant subsidiaries and their jurisdictions of incorporation is

included in Exhibit 8.1 to this Annual Report.

Our production and manufacturing facilities for consumable products are located in Germany, the United States and

China. Our facilities for software development are located in the United States, Germany, Poland, Denmark and

Romania. In recent years, we have made investments in automated and interchangeable production equipment to

increase our production capacity and improve efficiency. Our production and manufacturing operations are highly

integrated and benefit from sophisticated inventory control. Production management personnel are highly qualified,

and many have advanced degrees in engineering, business and science. We also have installed and continue to

expand production-planning systems that are included in our integrated information and control system based on the

SAP R/3 business software package from SAP AG. Worldwide, we use SAP software to integrate most of our

operating subsidiaries. Capital expenditures for property, plant and equipment totaled $118.0 million, $109.8

million and $90.1 million for 2019, 2018 and 2017, respectively.

We have an established quality system, including standard manufacturing and documentation procedures, intended

to ensure that products are produced and tested in accordance with the FDA's Quality System Regulations, which

impose current Good Manufacturing Practice (cGMP) requirements. For cGMP production, special areas were built in

our facilities in Hilden, Germany, Germantown, Maryland and Shenzhen, China. These facilities operate in

accordance with cGMP requirements.

The consumable products manufactured at QIAGEN GmbH in Germany, and QIAGEN Sciences LLC in Maryland,

are produced under ISO 9001: 2008, ISO 13485:2012, ISO 13485:2003 CMDCAS. Our certifications form part

of our ongoing commitment to provide our customers with high-quality, state-of-the-art sample and assay technologies

under our Total Quality Management system.

Our facilities in Hilden, Germany, currently occupy a total of approximately 786,000 square feet. Our most recent
expansion to these facilities was in 2018 and included approximately 6,400 square feet of clean room space for
Stat-DX integration. Our production capacity is increased through our manufacturing and research facilities in the
United States. QIAGEN Sciences, LLC owns a 24-acre site in Germantown, Maryland. The 285,000 square foot
Germantown facility consists of several buildings in a campus-like arrangement and can accommodate over 500
employees. There is room for future expansion of up to 300,000 square feet of facility space.

We lease facilities in Frederick, Maryland comprising 42,000 square feet for manufacturing, warehousing,
distribution and research operations and also facilities in Beverly, Massachusetts with 44,000 square feet for enzyme
manufacturing. Additionally, we have leased facilities in Redwood City, California with 12,700 square feet for
digital insights and 19,000 square feet in Minden, Nevada for Service Solutions. We have shared service centers
which lease facilities in Wroclaw, Poland (48,600 square feet) and Manila, Philippines (29,300 square feet).
Additionally, we lease facilities in Shenzhen, China and Manchester, United Kingdom for research operations. Other
subsidiaries throughout the world lease smaller amounts of space. Our corporate headquarters are located in leased
office space in Venlo, The Netherlands.

We believe our existing production and distribution facilities can support anticipated production needs for the next
36 months. Our production and manufacturing operations are subject to various federal, state, and local laws and
regulations including environmental regulations. We do not believe we have any material issues relating to these
laws and regulations.

52

European UnionOrganizational StructureDescription of PropertyM A N A G E M E N T   R E P O R T

Business and Operating Environment

53

Management Report
Management Report

Opportunities and Risks
Business and Operating Environment

QIAGEN’s business, like that of any other company, involves significant opportunities and risks. Effective
QIAGEN’s business, like that of any other company, involves significant opportunities 
QIAGEN is a global leader in Sample to Insight solutions that transform biological samples into valuable molecular
management is paramount in delivering sustainable value creation, and the central task of the leadership team. To
and risks. Effective management is paramount in delivering sustainable value  
insights. Our mission is to enable customers across the continuum of molecular testing to unlock valuable insights
sustain QIAGEN’s growth, effective execution is crucial in the development and commercialization of new products;
faster, better and more efficiently - from the raw biological sample to the final interpreted result.
structure and implementation of acquisitions and strategic partnerships; and response to the wide variety of
creation, and the central task of the leadership team. To sustain QIAGEN’s growth, 
Management Report
developments in markets where QIAGEN operates around the world. Managing opportunities and risks is an integral
effective execution is crucial in the development and commercialization of new  
part of the corporate governance system in place throughout QIAGEN, not the task of one particular organizational
We serve more than 500,000 customers in two broad customer groups: Molecular Diagnostics (human healthcare)
products; structure and implementation of acquisitions and strategic partnerships; and 
unit. Management systems are in place to aggregate all risks and opportunities for review at the Managing Board
and Life Sciences (academia, pharma R&D and industrial applications, primarily forensics). Proven QIAGEN
response to the wide variety of developments in markets where QIAGEN operates 
and Supervisory Board levels of QIAGEN N.V., and these are reviewed on a routine basis. Based on our assessment
solutions and content are providing answers in hospitals and laboratories worldwide, helping make sense of the
Opportunities and Risks
at the end of 2019, we consider the opportunities and risks manageable and the survival of QIAGEN not in danger,
increasing volumes and complexity of biological information, in keeping with our vision of making improvements in
around the world. Managing opportunities and risks is an integral part of the corpo-
the same position taken at year-end 2018. This assessment is supported by our strong balance sheet and the current
life possible.
rate governance system in place throughout QIAGEN, not the task of one particular 
business outlook, and further supported by the positive historical response to our external financing needs. As a
QIAGEN’s business, like that of any other company, involves significant opportunities and risks. Effective
organizational unit. Management systems are in place to aggregate all risks and 
result, QIAGEN has not sought an official rating by any of the leading rating agencies. We are confident in the
QIAGEN began operations in 1986 as a pioneer in the emerging biotechnology sector, introducing a novel method
management is paramount in delivering sustainable value creation, and the central task of the leadership team. To
future earnings strength of QIAGEN and have access to the resources to pursue value-creating business
opportunities for review at the Managing Board and Supervisory Board levels of 
that standardized and accelerated extraction and purification of nucleic acids from biological samples. As molecular
sustain QIAGEN’s growth, effective execution is crucial in the development and commercialization of new products;
opportunities.
biology and genomic knowledge have grown to influence many areas of life, QIAGEN has expanded to serve the
QIAGEN N.V., and these are reviewed on a routine basis. Based on our assessment 
structure and implementation of acquisitions and strategic partnerships; and response to the wide variety of
full spectrum of market needs. We believe our sample technologies are unmatched in quality for isolating and
developments in markets where QIAGEN operates around the world. Managing opportunities and risks is an integral
at the end of 2019, we consider the opportunities and risks manageable and the  
preparing DNA (deoxyribonucleic acid), RNA (ribonucleic acid) and proteins from blood or other liquids, tissue,
Opportunities
part of the corporate governance system in place throughout QIAGEN, not the task of one particular organizational
survival of QIAGEN not in danger, the same position taken at year-end 2018. This 
plants or other materials. Our assay technologies amplify, enrich and make these biomolecules accessible for
unit. Management systems are in place to aggregate all risks and opportunities for review at the Managing Board
Our mission is to make improvements in life possible by capturing growth opportunities as genomic and molecular
analysis, such as identifying the genetic information of a pathogen or a gene mutation in a tumor. QIAGEN’s
assessment is supported by our strong balance sheet and the current business out-
and Supervisory Board levels of QIAGEN N.V., and these are reviewed on a routine basis. Based on our assessment
technologies disseminate across two customer classes: Molecular Diagnostics and Life Science, including Academia
industry-leading Digital Insights solutions allow users to analyze and interpret data with bioinformatics software and
at the end of 2019, we consider the opportunities and risks manageable and the survival of QIAGEN not in danger,
look, and further supported by the positive historical response to our external financing 
and Applied Testing and Pharma. Due to increased life expectancies worldwide and the dynamic growth of
knowledge bases to provide relevant, actionable insights. Our automation systems tie these technologies together in
the same position taken at year-end 2018. This assessment is supported by our strong balance sheet and the current
needs. As a result, QIAGEN has not sought an official rating by any of the leading 
healthcare both in developed and emerging markets, the need for innovative diagnostics is increasing. Diagnostics
seamless and cost-effective molecular testing workflows - from Sample to Insight.
business outlook, and further supported by the positive historical response to our external financing needs. As a
offer proven benefits to improve healthcare outcomes, particularly the use of companion diagnostics in precision
rating agencies. We are confident in the future earnings strength of QIAGEN and 
result, QIAGEN has not sought an official rating by any of the leading rating agencies. We are confident in the
medicine, while still representing a small fraction of overall healthcare expenditures. Internal R&D activities of
Net sales of $1.53 billion in 2019 consisted of consumable kits and other revenues (89% of sales) and automation
have access to the resources to pursue value-creating business opportunities.
future earnings strength of QIAGEN and have access to the resources to pursue value-creating business
QIAGEN and partnerships with other companies present major opportunities to develop new products and improve
systems and instruments (11% of sales). Approximately 48% of net sales in 2019 were in Molecular Diagnostics, and
opportunities.
existing ones across our portfolio of Sample to Insight solutions. We also continuously evaluate potential targeted
52% in Life Sciences customer classes in the Academia / Applied Testing and Pharma markets.
acquisition opportunities to add new technologies or enter growing markets. All of these factors represent future
Opportunities
growth opportunities for QIAGEN.
QIAGEN has grown by developing new instruments, consumables and digital solutions to meet diverse and growing
needs in the market, partnering with researchers and Pharma companies, and acquiring companies or technologies
Our mission is to make improvements in life possible by capturing growth opportunities as genomic and molecular
Senior management at QIAGEN focuses strategic attention on identifying and assessing opportunities as early as
to complement our portfolio. We believe the addressable global market for QIAGEN's portfolio of molecular testing
technologies disseminate across two customer classes: Molecular Diagnostics and Life Science, including Academia
possible, taking actions to maximize the value of those opportunities and executing on initiatives to deliver business
products for customers across the continuum of life science research and molecular diagnostics totals more than $10
and Applied Testing and Pharma. Due to increased life expectancies worldwide and the dynamic growth of
success. QIAGEN evaluates organic growth opportunities each year as part of its annual budget planning process,
billion.
healthcare both in developed and emerging markets, the need for innovative diagnostics is increasing. Diagnostics
and during the year, especially in dynamically changing areas of the business portfolio. These evaluations are based
offer proven benefits to improve healthcare outcomes, particularly the use of companion diagnostics in precision
on proposals for new products, services and technologies developed within QIAGEN. This cross-functional process
medicine, while still representing a small fraction of overall healthcare expenditures. Internal R&D activities of
We have funded our growth through internally generated funds, debt offerings, and private and public sales of
involves a careful analysis of the market environment and competitive positioning, as well as factors such as
QIAGEN and partnerships with other companies present major opportunities to develop new products and improve
equity securities. QIAGEN’s global shares are listed on the New York Stock Exchange under the ticker symbol
expected development timelines, regulatory processes and reimbursement issues, when evaluating organic
existing ones across our portfolio of Sample to Insight solutions. We also continuously evaluate potential targeted
QGEN and on the Frankfurt Prime Standard as QIA.
opportunities. Business plans include information about the product or service to be developed, along with profiles
acquisition opportunities to add new technologies or enter growing markets. All of these factors represent future
on target customers and competitors, market size and barriers to entry. It also outlines the resources required for
growth opportunities for QIAGEN.
The company is registered under its commercial and legal name QIAGEN N.V. with the trade register (kamer van
implementation. As part of this process, these plans are subjected to a uniform profitability analysis to determine the
koophandel) of the Dutch region Limburg Noord under file number 12036979. QIAGEN N.V. is a public limited
net present value of an investment and the opportunities to create value (as measured with QIAGEN Value Added, or
Senior management at QIAGEN focuses strategic attention on identifying and assessing opportunities as early as
liability company (naamloze vennootschap) under Dutch law as a holding company. Our principal executive office is
QVA) and generate returns that exceed the Group’s cost of capital after a multi-year period. The monitoring of
possible, taking actions to maximize the value of those opportunities and executing on initiatives to deliver business
located at Hulsterweg 82, 5912 PL Venlo, The Netherlands, and our telephone number is +31-77-355-6600.
growth initiatives is accomplished through regular reporting to the Supervisory Board on the status and progress of
success. QIAGEN evaluates organic growth opportunities each year as part of its annual budget planning process,
key initiatives during the year. Project management and the supporting central functions report directly to the
and during the year, especially in dynamically changing areas of the business portfolio. These evaluations are based
Executive Committee.
As a holding company, QIAGEN conducts business through subsidiaries located throughout the world. Further
on proposals for new products, services and technologies developed within QIAGEN. This cross-functional process
information about QIAGEN can be found at www.QIAGEN.com. By referring to our website, we do not incorporate
involves a careful analysis of the market environment and competitive positioning, as well as factors such as
the website or any portion of the website by reference into this Annual Report.
Risk Factors
expected development timelines, regulatory processes and reimbursement issues, when evaluating organic
opportunities. Business plans include information about the product or service to be developed, along with profiles
on target customers and competitors, market size and barriers to entry. It also outlines the resources required for
implementation. As part of this process, these plans are subjected to a uniform profitability analysis to determine the
54
net present value of an investment and the opportunities to create value (as measured with QIAGEN Value Added, or
QVA) and generate returns that exceed the Group’s cost of capital after a multi-year period. The monitoring of

growth initiatives is accomplished through regular reporting to the Supervisory Board on the status and progress of

key initiatives during the year. Project management and the supporting central functions report directly to the

Executive Committee.

Risk Factors

Management Report

Management Report

Opportunities and Risks

Opportunities and Risks

QIAGEN’s business, like that of any other company, involves significant opportunities and risks. Effective

management is paramount in delivering sustainable value creation, and the central task of the leadership team. To

QIAGEN’s business, like that of any other company, involves significant opportunities and risks. Effective

sustain QIAGEN’s growth, effective execution is crucial in the development and commercialization of new products;

management is paramount in delivering sustainable value creation, and the central task of the leadership team. To

structure and implementation of acquisitions and strategic partnerships; and response to the wide variety of

sustain QIAGEN’s growth, effective execution is crucial in the development and commercialization of new products;

developments in markets where QIAGEN operates around the world. Managing opportunities and risks is an integral

structure and implementation of acquisitions and strategic partnerships; and response to the wide variety of

part of the corporate governance system in place throughout QIAGEN, not the task of one particular organizational

developments in markets where QIAGEN operates around the world. Managing opportunities and risks is an integral

part of the corporate governance system in place throughout QIAGEN, not the task of one particular organizational

unit. Management systems are in place to aggregate all risks and opportunities for review at the Managing Board

unit. Management systems are in place to aggregate all risks and opportunities for review at the Managing Board

and Supervisory Board levels of QIAGEN N.V., and these are reviewed on a routine basis. Based on our assessment

and Supervisory Board levels of QIAGEN N.V., and these are reviewed on a routine basis. Based on our assessment

at the end of 2019, we consider the opportunities and risks manageable and the survival of QIAGEN not in danger,

at the end of 2019, we consider the opportunities and risks manageable and the survival of QIAGEN not in danger,

the same position taken at year-end 2018. This assessment is supported by our strong balance sheet and the current

the same position taken at year-end 2018. This assessment is supported by our strong balance sheet and the current

business outlook, and further supported by the positive historical response to our external financing needs. As a

business outlook, and further supported by the positive historical response to our external financing needs. As a

result, QIAGEN has not sought an official rating by any of the leading rating agencies. We are confident in the

result, QIAGEN has not sought an official rating by any of the leading rating agencies. We are confident in the

future earnings strength of QIAGEN and have access to the resources to pursue value-creating business

future earnings strength of QIAGEN and have access to the resources to pursue value-creating business

opportunities.

opportunities.

Opportunities

Opportunities

Our mission is to make improvements in life possible by capturing growth opportunities as genomic and molecular

Our mission is to make improvements in life possible by capturing growth opportunities as genomic and molecular

technologies disseminate across two customer classes: Molecular Diagnostics and Life Science, including Academia

technologies disseminate across two customer classes: Molecular Diagnostics and Life Science, including Academia

and Applied Testing and Pharma. Due to increased life expectancies worldwide and the dynamic growth of

and Applied Testing and Pharma. Due to increased life expectancies worldwide and the dynamic growth of

healthcare both in developed and emerging markets, the need for innovative diagnostics is increasing. Diagnostics

healthcare both in developed and emerging markets, the need for innovative diagnostics is increasing. Diagnostics

offer proven benefits to improve healthcare outcomes, particularly the use of companion diagnostics in precision

offer proven benefits to improve healthcare outcomes, particularly the use of companion diagnostics in precision

medicine, while still representing a small fraction of overall healthcare expenditures. Internal R&D activities of

medicine, while still representing a small fraction of overall healthcare expenditures. Internal R&D activities of

QIAGEN and partnerships with other companies present major opportunities to develop new products and improve

QIAGEN and partnerships with other companies present major opportunities to develop new products and improve

existing ones across our portfolio of Sample to Insight solutions. We also continuously evaluate potential targeted

existing ones across our portfolio of Sample to Insight solutions. We also continuously evaluate potential targeted

acquisition opportunities to add new technologies or enter growing markets. All of these factors represent future

acquisition opportunities to add new technologies or enter growing markets. All of these factors represent future

growth opportunities for QIAGEN.

growth opportunities for QIAGEN.

Senior management at QIAGEN focuses strategic attention on identifying and assessing opportunities as early as
Senior management at QIAGEN focuses strategic attention on identifying and assessing opportunities as early as
possible, taking actions to maximize the value of those opportunities and executing on initiatives to deliver business
M A N A G E M E N T   R E P O R T Opportunities and Risks
possible, taking actions to maximize the value of those opportunities and executing on initiatives to deliver business
success. QIAGEN evaluates organic growth opportunities each year as part of its annual budget planning process,
success. QIAGEN evaluates organic growth opportunities each year as part of its annual budget planning process,
and during the year, especially in dynamically changing areas of the business portfolio. These evaluations are based
and during the year, especially in dynamically changing areas of the business portfolio. These evaluations are based
on proposals for new products, services and technologies developed within QIAGEN. This cross-functional process
on proposals for new products, services and technologies developed within QIAGEN. This cross-functional process
involves a careful analysis of the market environment and competitive positioning, as well as factors such as
involves a careful analysis of the market environment and competitive positioning, as well as factors such as
expected development timelines, regulatory processes and reimbursement issues, when evaluating organic
expected development timelines, regulatory processes and reimbursement issues, when evaluating organic
opportunities. Business plans include information about the product or service to be developed, along with profiles
opportunities. Business plans include information about the product or service to be developed, along with profiles
on target customers and competitors, market size and barriers to entry. It also outlines the resources required for
on target customers and competitors, market size and barriers to entry. It also outlines the resources required for
implementation. As part of this process, these plans are subjected to a uniform profitability analysis to determine the
implementation. As part of this process, these plans are subjected to a uniform profitability analysis to determine the
net present value of an investment and the opportunities to create value (as measured with QIAGEN Value Added, or
net present value of an investment and the opportunities to create value (as measured with QIAGEN Value Added, or
QVA) and generate returns that exceed the Group’s cost of capital after a multi-year period. The monitoring of
QVA) and generate returns that exceed the Group’s cost of capital after a multi-year period. The monitoring of
growth initiatives is accomplished through regular reporting to the Supervisory Board on the status and progress of
growth initiatives is accomplished through regular reporting to the Supervisory Board on the status and progress of
key initiatives during the year. Project management and the supporting central functions report directly to the
key initiatives during the year. Project management and the supporting central functions report directly to the
Executive Committee.
Executive Committee.

Risk Factors
Risk Factors

Our risk management approach embodies the key elements of a sound risk management system including (1) active
Supervisory Board and senior management involvement; (2) adequate policies and procedures; (3) adequate risk
management; monitoring and information systems; and (4) comprehensive internal controls.

QIAGEN is managed by a Managing Board and an independent Supervisory Board appointed by the General
Meeting of Shareholders. One of the Managing Board's responsibilities is the oversight of the risk management
system. The Managing Board has developed and implemented strategies, controls and mitigation measures to
identify current and developing risks as part of the risk management system. These policies and procedures are
embodied in our corporate governance, code of ethics and financial reporting controls and procedures. A variety of
functional experts evaluate these business risks, attempting to mitigate and manage these risks on an ongoing basis.

Identified risks are subdivided into three types:

›

A base business risk that is specific to us or our industry and threatens our existing business;

›

A business growth risk that is specific to us or our industry and threatens our future business growth; and

›

An underlying business risk that is not specific to us or our industry, but applies to a larger number of public
companies.

All identified risks are evaluated based on their likelihood of occurring and their potential impact (estimated in
monetary terms) in disrupting our progress in achieving our business objectives. The overall risk management goal is
to identify risks that could significantly threaten our success and to allow management on a timely basis the
opportunity to successfully implement mitigation actions. The results of the risk assessment, and any updates, are
reported to the Audit Committee of the Supervisory Board on a regular basis. A detailed risk reporting update is
provided each quarter to the Audit Committee for specific risks that have been newly identified or have changed
since the previous assessment. At least once on an annual basis, the Supervisory Board discusses the corporate
strategy and business risks as well as the results of an assessment by the Managing Board and the Audit Committee
of the structure and operations of the internal risk management and control systems, including any significant
changes.

Our corporate governance structure is based on a strong framework that outlines the responsibilities of our
Managing and Supervisory Boards (discussed in more detail in the “Corporate Governance” section below) and the
function of the Audit Committee of the Supervisory Board (discussed in more detail in the “Corporate Governance”
section below). We maintain adequate internal controls over financial reporting to ensure the integrity of financial
reporting, which is described further in the “Corporate Governance” section below. Additionally, we have a
Compliance Committee that consists of senior executives from various functional areas who are responsible for
ensuring compliance with legal and regulatory requirements, as well as overseeing the communication of corporate
policies, including our Code of Ethics as described further in the “Human Resources” section below.

55

Risk Management:Base Business Risk

Business Growth Risk

Underlying Business Risk

·

·

·

·

·

·

·

·

·

·

·

·

·

Identification and monitoring of competitive business threats

Monitoring complexity of product portfolio

Monitoring dependence on key customers for single product groups

Reviewing dependence on individual production sites or suppliers

Evaluating purchasing initiatives, price controls and changes to reimbursements

Monitoring production risks, including contamination prevention, high-quality
product assurance

Ensuring ability to defend against intellectual property infringements and
maintain competitive advantage after expiration

Managing development and success of key R&D projects

Managing successful integration of acquisitions to achieve anticipated benefits

Evaluating financial risks, including economic risks and currency rate
fluctuations

Monitoring financial reporting risks, including multi-jurisdiction tax compliance

Reviewing possible asset impairment events

Assessing compliance and legal risks, including safety in operations and
environmental hazard risks, compliance with various regulatory bodies and
pending

The risks described below are listed in the order of our current view of their expected significance. Describing the
risk factors in order of significance does not imply that a lower listed risk factor may not have a material adverse
impact on our results of operations, liquidity or capital resources.

Risks:

Rapid technological change and frequent new product introductions are typical in the markets we serve. Our success
will depend in part on continuous, timely development and introduction of new products that address evolving market
requirements. We believe successful new product introductions provide a significant competitive advantage because
customers make an investment of time in selecting and learning to use a new product and are reluctant to switch after
these efforts. To the extent that we fail to introduce new and innovative products, or such products suffer significant
delays in development or are not accepted in the market, we may lose market share to our competitors that would be
difficult or impossible to regain. An inability to successfully develop and introduce new products, for technological or
other reasons, could reduce our growth rate or otherwise have an adverse effect on our business. In the past, we
have experienced delays in the development and introduction of products, including regulatory approvals, or
decisions to stop development of projects, and we may experience delays or make decisions to stop certain products
in the future.

As a result, we cannot assure you that we will keep pace with the rapid rate of change in our markets or that our
new products will adequately meet the requirements of the marketplace, achieve market acceptance or regulatory
approval, or compete successfully with companies offering similar or new technologies. Some of the factors affecting
56
market acceptance of new products include:

Our continued growth is dependent on the development and success of new products.Risk Types·

·

·

·

·

·

·

·

·

·

·

·

Base Business Risk

Identification and monitoring of competitive business threats

Monitoring complexity of product portfolio

Monitoring dependence on key customers for single product groups

Reviewing dependence on individual production sites or suppliers

Evaluating purchasing initiatives, price controls and changes to reimbursements

Monitoring production risks, including contamination prevention, high-quality

product assurance

·

Ensuring ability to defend against intellectual property infringements and

maintain competitive advantage after expiration

Business Growth Risk

Managing development and success of key R&D projects

Managing successful integration of acquisitions to achieve anticipated benefits

Underlying Business Risk

Evaluating financial risks, including economic risks and currency rate

fluctuations

Monitoring financial reporting risks, including multi-jurisdiction tax compliance

Reviewing possible asset impairment events

Assessing compliance and legal risks, including safety in operations and

environmental hazard risks, compliance with various regulatory bodies and

pending

The risks described below are listed in the order of our current view of their expected significance. Describing the

risk factors in order of significance does not imply that a lower listed risk factor may not have a material adverse

impact on our results of operations, liquidity or capital resources.

Risks:

Rapid technological change and frequent new product introductions are typical in the markets we serve. Our success

will depend in part on continuous, timely development and introduction of new products that address evolving market

requirements. We believe successful new product introductions provide a significant competitive advantage because
customers make an investment of time in selecting and learning to use a new product and are reluctant to switch after
these efforts. To the extent that we fail to introduce new and innovative products, or such products suffer significant
M A N A G E M E N T   R E P O R T Opportunities and Risks
delays in development or are not accepted in the market, we may lose market share to our competitors that would be
difficult or impossible to regain. An inability to successfully develop and introduce new products, for technological or
other reasons, could reduce our growth rate or otherwise have an adverse effect on our business. In the past, we
have experienced delays in the development and introduction of products, including regulatory approvals, or
decisions to stop development of projects, and we may experience delays or make decisions to stop certain products
in the future.

As a result, we cannot assure you that we will keep pace with the rapid rate of change in our markets or that our
new products will adequately meet the requirements of the marketplace, achieve market acceptance or regulatory
approval, or compete successfully with companies offering similar or new technologies. Some of the factors affecting
market acceptance of new products include:

›

availability, quality and price relative to existing competitive products;

›

the timing of introduction of the new product relative to competitive products;

›

opinions of the new product’s utility;

›

citation of the new product in published research;

›

regulatory trends and approvals; and

›

general trends in life sciences research, applied markets and molecular diagnostics.

In the development of new products we may make significant investments in intellectual property and software
solutions. These investments increase our fixed costs, resulting in higher operational costs in the short term that will
negatively impact our gross profit and operating income until products potentially reach a minimum level of market
acceptance. The expenses or losses associated with unsuccessful product development activities or lack of market
acceptance of our new products could materially adversely affect our business, financial condition and results of
operations.

Our continued growth depends significantly on the success of new products in the molecular testing markets we
serve. Important new product programs underway include our modular medium-throughput QIAsymphony automation
platform, QIAstat-Dx system for one-step, fully integrated molecular analysis of hard-to-diagnose syndromes, the high-
throughput NeuMoDx 288 and mid-throughput NeuMoDx 96 fully integrated PCR automation systems, sample and
assay technologies designed either for use either with QIAGEN instruments or for "universal" automation systems
and instruments, and bioinformatics solutions to analyze and interpret complex genomic data. In addition, we are
now developing next-generation systems for digital PCR, an emerging analytical technique in the life sciences,
targeting a 2020 launch with fully-integrated solutions that simplify workflows and offer other advantages.

The speed and level of adoption of our new automation platforms will affect sales not only of instrumentation but also
of consumables, sample and assay kits, designed to run on the systems. The rollouts of new automation platforms are
intended to drive the dissemination and increasing sales of consumables for these systems. We are developing or co-
developing new kits for each of these platforms and seeking regulatory approvals for a number of these new
products. In turn, the availability and regulatory approval of more tests for processing on QIAsymphony, QIAstat-Dx
and NeuMoDx systems, especially molecular assays for specific diseases or companion diagnostics paired with new
drugs, will influence the value of the instruments to prospective buyers. Slower adoption of QIAsymphony, including
the complete QIAsymphony RGQ system, the QIAstat-Dx and NeuMoDx systems, and the planned digital PCR
workflows, could significantly affect sales of products designed to run on these platforms.

Our business has grown, with total net sales increasing to $1.53 billion in 2019 from $1.28 billion in 2015. We
have made a series of acquisitions in recent years, including the acquisitions of N-of-One in January 2019, STAT-Dx
Life, S.L. in 2018, and OmicSoft Corporation in 2017 to complement internal research and development activities.
We intend to identify and acquire other businesses in the future that support our strategy to build on our global
leadership position in Sample to Insight solutions focused on molecular testing. The successful integration of acquired
businesses requires a significant effort and expense across all operational areas.

We continue to make investments to expand our existing business operations. These projects increase our fixed costs,
resulting in higher operational costs in the short term that will negatively impact our gross profit and operating
income until we more fully utilize the additional capacity of these facilities. In addition, we have invested in
establishing and expanding shared service centers in Poland and the Philippines, opening new commercial
operations in emerging markets to expand our geographic footprint, and implementing digitization of business

57

processes to increase sales growth while also enhancing operational efficiencies. The expansion of our business and

the addition of new personnel may place a strain on our management and operational systems. As we continue to

upgrade our operating and financial systems, as well as expand the geographic presence of our operations, we

intend to continue to assess the need to reallocate existing resources or hire new employees, as well as increased

responsibilities for both existing and new management personnel.

Our continued growth is dependent on the development and success of new products.Risk TypesAn inability to manage our growth, manage the expansion of our operations, orsuccessfully integrate acquired businesses could adversely affect our business.›

availability, quality and price relative to existing competitive products;

›

the timing of introduction of the new product relative to competitive products;

›

opinions of the new product’s utility;

›

citation of the new product in published research;

›

regulatory trends and approvals; and

›

general trends in life sciences research, applied markets and molecular diagnostics.

In the development of new products we may make significant investments in intellectual property and software

solutions. These investments increase our fixed costs, resulting in higher operational costs in the short term that will

negatively impact our gross profit and operating income until products potentially reach a minimum level of market

acceptance. The expenses or losses associated with unsuccessful product development activities or lack of market

acceptance of our new products could materially adversely affect our business, financial condition and results of

operations.

Our continued growth depends significantly on the success of new products in the molecular testing markets we

serve. Important new product programs underway include our modular medium-throughput QIAsymphony automation

platform, QIAstat-Dx system for one-step, fully integrated molecular analysis of hard-to-diagnose syndromes, the high-

throughput NeuMoDx 288 and mid-throughput NeuMoDx 96 fully integrated PCR automation systems, sample and

assay technologies designed either for use either with QIAGEN instruments or for "universal" automation systems

and instruments, and bioinformatics solutions to analyze and interpret complex genomic data. In addition, we are

now developing next-generation systems for digital PCR, an emerging analytical technique in the life sciences,

targeting a 2020 launch with fully-integrated solutions that simplify workflows and offer other advantages.

The speed and level of adoption of our new automation platforms will affect sales not only of instrumentation but also

of consumables, sample and assay kits, designed to run on the systems. The rollouts of new automation platforms are

intended to drive the dissemination and increasing sales of consumables for these systems. We are developing or co-

developing new kits for each of these platforms and seeking regulatory approvals for a number of these new

products. In turn, the availability and regulatory approval of more tests for processing on QIAsymphony, QIAstat-Dx

and NeuMoDx systems, especially molecular assays for specific diseases or companion diagnostics paired with new

drugs, will influence the value of the instruments to prospective buyers. Slower adoption of QIAsymphony, including

the complete QIAsymphony RGQ system, the QIAstat-Dx and NeuMoDx systems, and the planned digital PCR

workflows, could significantly affect sales of products designed to run on these platforms.

Our business has grown, with total net sales increasing to $1.53 billion in 2019 from $1.28 billion in 2015. We
have made a series of acquisitions in recent years, including the acquisitions of N-of-One in January 2019, STAT-Dx
Life, S.L. in 2018, and OmicSoft Corporation in 2017 to complement internal research and development activities.
We intend to identify and acquire other businesses in the future that support our strategy to build on our global
leadership position in Sample to Insight solutions focused on molecular testing. The successful integration of acquired
businesses requires a significant effort and expense across all operational areas.

We continue to make investments to expand our existing business operations. These projects increase our fixed costs,
resulting in higher operational costs in the short term that will negatively impact our gross profit and operating
income until we more fully utilize the additional capacity of these facilities. In addition, we have invested in
establishing and expanding shared service centers in Poland and the Philippines, opening new commercial
operations in emerging markets to expand our geographic footprint, and implementing digitization of business
processes to increase sales growth while also enhancing operational efficiencies. The expansion of our business and
the addition of new personnel may place a strain on our management and operational systems. As we continue to
upgrade our operating and financial systems, as well as expand the geographic presence of our operations, we
intend to continue to assess the need to reallocate existing resources or hire new employees, as well as increased
responsibilities for both existing and new management personnel.

Our future operating results will depend on our ability to continue to implement and improve our research, product
development, manufacturing, sales and marketing and customer support programs, enhance our operational and
financial control systems, expand, train and manage our employee base, integrate acquired businesses, and
effectively address new issues related to our growth as they arise. There can be no assurance that we will be able to
manage our recent or any future expansion or acquisitions successfully, and any inability to do so could have a
material adverse effect on our results of operations.

During the past several years, we have acquired and integrated a number of companies through which we have
gained access to new technologies, products and businesses that complement our internally developed product lines.
In the future, we expect to acquire additional technologies, products or businesses to expand our operations.
Acquisitions expose us to new operating and financial risks, including risks associated with the:

›

assimilation of new products, technologies, operations, sites and personnel;

›

integration and retention of fundamental personnel and technical expertise;

›

application for and achievement of regulatory approvals or other clearances;

›

diversion of resources from our existing products, business and technologies;

›

generation of sales;

›

implementation and maintenance of uniform standards and effective controls and procedures;

›

exposure to pre-existing cyber security risks or compromise of acquired entities;

›

maintenance of relationships with employees, customers and suppliers, and integration of new management
personnel;

›

issuance of dilutive equity securities;

›

incurrence or assumption of debt and contingent liabilities;

›

amortization or impairment of acquired intangible assets or potential businesses; and

›

exposure to liabilities of and claims against acquired entities or personnel, including patent litigation.

Our failure to address the above risks successfully in the future may prevent us from achieving the anticipated
benefits from any acquisition in a reasonable time frame, or at all.

Our results of operations could be materially affected by adverse general conditions in the global economy and
58
financial markets.

The global outbreak of COVID-19 will have a significant impact on QIAGEN in 2020. Extraordinary demand has

emerged for molecular technologies involved in testing for the new pathogen. However, the total impact is not

predictable at this point, as the spike in demand is challenging the company’s short-term capacity for certain

products, while the pandemic also is disrupting broader economies and routine healthcare in 2020.

Potentially adverse changes that may come from the United Kingdom's exit from the European Union ("Brexit") are

not well understood as the actual impact from Brexit will depend on many factors including the ability of both the

United Kingdom and European Union authorities to provide a path forward with minimal disruption. In the near term

we anticipate the largest potential exposures to be on supply chain with our United Kingdom based suppliers and the

local operations for our domestic United Kingdom business and pharma development activities. There also is a risk of

Our acquisitions expose us to new risks, and we may not achieve the anticipatedbenefits of acquisitions of technologies and businesses.Global economic conditions could adversely affect our business, results of operationsand financial condition.An inability to manage our growth, manage the expansion of our operations, orsuccessfully integrate acquired businesses could adversely affect our business.Our future operating results will depend on our ability to continue to implement and improve our research, product

development, manufacturing, sales and marketing and customer support programs, enhance our operational and

financial control systems, expand, train and manage our employee base, integrate acquired businesses, and

effectively address new issues related to our growth as they arise. There can be no assurance that we will be able to

manage our recent or any future expansion or acquisitions successfully, and any inability to do so could have a

material adverse effect on our results of operations.

During the past several years, we have acquired and integrated a number of companies through which we have

gained access to new technologies, products and businesses that complement our internally developed product lines.

In the future, we expect to acquire additional technologies, products or businesses to expand our operations.

Acquisitions expose us to new operating and financial risks, including risks associated with the:

›

assimilation of new products, technologies, operations, sites and personnel;

›

integration and retention of fundamental personnel and technical expertise;

›

application for and achievement of regulatory approvals or other clearances;

›

diversion of resources from our existing products, business and technologies;

›

generation of sales;

›

implementation and maintenance of uniform standards and effective controls and procedures;

›

exposure to pre-existing cyber security risks or compromise of acquired entities;

›

maintenance of relationships with employees, customers and suppliers, and integration of new management

personnel;

›

issuance of dilutive equity securities;

›

incurrence or assumption of debt and contingent liabilities;

M A N A G E M E N T   R E P O R T Opportunities and Risks

›

amortization or impairment of acquired intangible assets or potential businesses; and

›

exposure to liabilities of and claims against acquired entities or personnel, including patent litigation.

Our failure to address the above risks successfully in the future may prevent us from achieving the anticipated
benefits from any acquisition in a reasonable time frame, or at all.

Our results of operations could be materially affected by adverse general conditions in the global economy and
financial markets.

The global outbreak of COVID-19 will have a significant impact on QIAGEN in 2020. Extraordinary demand has
emerged for molecular technologies involved in testing for the new pathogen. However, the total impact is not
predictable at this point, as the spike in demand is challenging the company’s short-term capacity for certain
products, while the pandemic also is disrupting broader economies and routine healthcare in 2020.

Potentially adverse changes that may come from the United Kingdom's exit from the European Union ("Brexit") are
not well understood as the actual impact from Brexit will depend on many factors including the ability of both the
United Kingdom and European Union authorities to provide a path forward with minimal disruption. In the near term
we anticipate the largest potential exposures to be on supply chain with our United Kingdom based suppliers and the
local operations for our domestic United Kingdom business and pharma development activities. There also is a risk of
loss of revenue, penalties due to delayed deliveries and currency losses, or other unforeseen costs which would
negatively impact margins.

During challenging economic times, access to financing in the global financial markets has also been adversely
affected for many businesses. The uncertainty surrounding the resolution of the economic and sovereign debt crisis in
Europe continues to have a negative impact on financial markets and economic conditions more generally. Our
customers may face internal financing pressures that adversely impact spending decisions or the ability to purchase
our products, or that lead to a delay in collection of receivables and thus negatively impact our cash flow. A severe
or prolonged economic downturn could result in a variety of risks to our business that would adversely impact our
results of operations, including the reduction or delay in planned improvements to healthcare systems in various
countries, the reduction of funding for life sciences research, and intensified efforts by governments and healthcare
payors regarding cost-containment efforts.

Our results of operations could also be negatively impacted by any governmental actions or inaction resulting in
automatic government spending cuts (sequestration) that may take effect, particularly in terms of federal government
funding in the United States. These conditions may add uncertainty to the timing and budget for investment decisions
by our customers, particularly researchers, universities, government laboratories and private foundations whose
funding is dependent upon grants from government agencies, such as the U.S. National Institutes of Health (NIH)
and similar bodies.

As is the case for many businesses, we face the following risks in regard to financial markets:

›

severely limited access to financing over an extended period of time, which may affect our ability to fund our
growth strategy and could result in delays to capital expenditures, acquisitions or research and development
projects;

›

failures of currently solvent financial institutions, which may cause losses from our short-term cash investments or
our hedging transactions due to a counterparty’s inability to fulfill its payment obligations;

›

inability to refinance existing debt at competitive rates, reasonable terms or sufficient amounts; and

›

increased volatility or adverse movements in foreign currency exchange rates.

Changes in the availability or reimbursement of our diagnostic testing products by insurance providers and health
maintenance organizations could also have a significant adverse impact on our results of operations. Third-party
payors are often reluctant to reimburse healthcare providers for the use of medical tests that involve new technologies

59

or provide novel diagnostic information. In addition, third-party payors are increasingly limiting reimbursement

coverage for medical diagnostic products and, in many instances, are exerting pressure on suppliers to reduce their

prices. Since each third-party payor often makes reimbursement decisions on an individual patient basis, obtaining

such approvals is a time-consuming and costly process that requires us to provide scientific and clinical data

supporting the clinical benefits of each of our products. As a result, there can be no assurance that reimbursement

approvals will be obtained, and the process can delay the broad market introduction of new products. If third-party

reimbursement is not consistent or financially adequate to cover the cost of our products, this could limit our ability to

sell our products or cause us to reduce prices, which would adversely affect our results of operations.

Further, the ability of many of our customers to successfully market their products depends in part on the extent to

which reimbursement for the costs of these products is available from governmental health administrations, private

health insurers and other organizations. Governmental and other third-party payors are increasingly seeking to

contain healthcare costs and to reduce the price of medical products and services. For example, in 2010, the Patient

Protection and Affordable Care Act, or ACA, was enacted with the goal of expanding coverage, increasing quality

of care and reducing costs through payment innovation, among other things. With evolving political realities in the

United States, including divergent efforts by the Trump Administration and members of Congress, certain sections of

Our acquisitions expose us to new risks, and we may not achieve the anticipatedbenefits of acquisitions of technologies and businesses.Global economic conditions could adversely affect our business, results of operationsand financial condition.We may encounter delays in receipt, or limits in the amount, of reimbursementapprovals and public health funding, which will impact our ability to grow revenuesin the healthcare market or may negatively impact our profitability.loss of revenue, penalties due to delayed deliveries and currency losses, or other unforeseen costs which would

negatively impact margins.

During challenging economic times, access to financing in the global financial markets has also been adversely

affected for many businesses. The uncertainty surrounding the resolution of the economic and sovereign debt crisis in

Europe continues to have a negative impact on financial markets and economic conditions more generally. Our

customers may face internal financing pressures that adversely impact spending decisions or the ability to purchase

our products, or that lead to a delay in collection of receivables and thus negatively impact our cash flow. A severe

or prolonged economic downturn could result in a variety of risks to our business that would adversely impact our

results of operations, including the reduction or delay in planned improvements to healthcare systems in various

countries, the reduction of funding for life sciences research, and intensified efforts by governments and healthcare

payors regarding cost-containment efforts.

Our results of operations could also be negatively impacted by any governmental actions or inaction resulting in

automatic government spending cuts (sequestration) that may take effect, particularly in terms of federal government

funding in the United States. These conditions may add uncertainty to the timing and budget for investment decisions

by our customers, particularly researchers, universities, government laboratories and private foundations whose

funding is dependent upon grants from government agencies, such as the U.S. National Institutes of Health (NIH)

and similar bodies.

As is the case for many businesses, we face the following risks in regard to financial markets:

›

severely limited access to financing over an extended period of time, which may affect our ability to fund our

growth strategy and could result in delays to capital expenditures, acquisitions or research and development
projects;

›

failures of currently solvent financial institutions, which may cause losses from our short-term cash investments or
our hedging transactions due to a counterparty’s inability to fulfill its payment obligations;

›

inability to refinance existing debt at competitive rates, reasonable terms or sufficient amounts; and

›

increased volatility or adverse movements in foreign currency exchange rates.

Changes in the availability or reimbursement of our diagnostic testing products by insurance providers and health
maintenance organizations could also have a significant adverse impact on our results of operations. Third-party
payors are often reluctant to reimburse healthcare providers for the use of medical tests that involve new technologies
or provide novel diagnostic information. In addition, third-party payors are increasingly limiting reimbursement
coverage for medical diagnostic products and, in many instances, are exerting pressure on suppliers to reduce their
prices. Since each third-party payor often makes reimbursement decisions on an individual patient basis, obtaining
such approvals is a time-consuming and costly process that requires us to provide scientific and clinical data
supporting the clinical benefits of each of our products. As a result, there can be no assurance that reimbursement
approvals will be obtained, and the process can delay the broad market introduction of new products. If third-party
reimbursement is not consistent or financially adequate to cover the cost of our products, this could limit our ability to
sell our products or cause us to reduce prices, which would adversely affect our results of operations.

Further, the ability of many of our customers to successfully market their products depends in part on the extent to
which reimbursement for the costs of these products is available from governmental health administrations, private
health insurers and other organizations. Governmental and other third-party payors are increasingly seeking to
contain healthcare costs and to reduce the price of medical products and services. For example, in 2010, the Patient
Protection and Affordable Care Act, or ACA, was enacted with the goal of expanding coverage, increasing quality
of care and reducing costs through payment innovation, among other things. With evolving political realities in the
United States, including divergent efforts by the Trump Administration and members of Congress, certain sections of
the ACA have not been fully implemented and the direction of healthcare policy is unpredictable. Uncertainty around
the future of the ACA, and in particular the impact to reimbursement levels, may lead to uncertainty or delay in the
purchasing decisions of our customers, which may in turn negatively impact our product sales. In accordance with
the Protecting Access to Medicare Act of 2014 (PAMA), the Centers for Medicare & Medicaid Services calculate
Medicare reimbursement rates for certain clinical diagnostic tests using weighted median private payor rates, which
are based on rate information reported by applicable laboratories. This new rate methodology means the lower
reimbursement rates previously experienced in the field of molecular pathology testing now extends to additional
diagnostic testing codes on the Clinical Laboratory Fee Schedule (CLFS). If there are not adequate reimbursement
levels, our business and results of operations could be adversely affected.

Our customers include researchers at pharmaceutical and biotechnology companies, academic institutions, and
government and private laboratories. Fluctuations in the research and development budgets of these organizations
could have a significant adverse effect on demand for our products. Research and development budgets are affected
by changes in available resources, the mergers of pharmaceutical and biotechnology companies, changes in
spending priorities and institutional budgetary policies. Our results of operations could be adversely affected by any
significant decrease in expenditures for life sciences research and development by pharmaceutical and
biotechnology companies, academic institutions, and government and private laboratories. In addition, short-term
changes in administrative, regulatory or purchasing-related procedures can create uncertainties or other impediments
that can have an adverse impact on our results of operations.

In recent years, the pharmaceutical and biotechnology industries have undergone substantial restructuring and
consolidation. Additional mergers or consolidation within the pharmaceutical and biotechnology industries could
cause us to lose existing customers and potential future customers, which could have a material adverse impact on
our results of operations.

Approximately 25% of our sales are generated from demand for our products used at universities, government
laboratories and private foundations, and whose funding is dependent upon grants from government agencies, such
as the NIH (National Institutes of Health) in the United States. Although the level of research funding has been
60
increasing in recent years, we cannot assure you that this trend will continue given federal and state budget
constraints. Government funding of research and development is subject to the political process, which is inherently

unpredictable. Future sales may be adversely affected if our customers delay purchases as a result of uncertainties

regarding the approval of government or industrial budget proposals. Also, government proposals to reduce or

eliminate budgetary deficits have sometimes included reduced allocations to the NIH and government agencies in

other countries that fund life sciences research and development activities. A reduction in government funding for the

NIH or government research agencies in other countries could have a serious adverse impact on our results of

operations.

The markets for most of our products are very competitive. Competitors may have significant advantages in financial,

operational, sales and marketing resources as well as experience in research and development. These competitors

may have developed, or could develop in the future, new technologies that compete with our products or even

render our products obsolete. Some competitors may obtain regulatory approval from the FDA or similar non-U.S.

authorities and market approved products. Our competitors’ development of alternative products offering superior

technology, greater cost-effectiveness or regulatory approval could have a material adverse effect on our sales and

results of operations.

The growth of our business depends in part on the continued conversion of users from competitive products to our

sample and assay technologies and other solutions. Lack of conversion could have a material adverse effect on our

sales and results of operations.

It can be difficult for users of our products to switch from their current supplier of a particular product, primarily due

to the time and expense required to properly integrate new products into their operations. As a result, if we are

We may encounter delays in receipt, or limits in the amount, of reimbursementapprovals and public health funding, which will impact our ability to grow revenuesin the healthcare market or may negatively impact our profitability.Reduction in research and development budgets and government funding may resultin reduced sales.Competition could reduce our sales.the ACA have not been fully implemented and the direction of healthcare policy is unpredictable. Uncertainty around

the future of the ACA, and in particular the impact to reimbursement levels, may lead to uncertainty or delay in the

purchasing decisions of our customers, which may in turn negatively impact our product sales. In accordance with

the Protecting Access to Medicare Act of 2014 (PAMA), the Centers for Medicare & Medicaid Services calculate

Medicare reimbursement rates for certain clinical diagnostic tests using weighted median private payor rates, which

are based on rate information reported by applicable laboratories. This new rate methodology means the lower

reimbursement rates previously experienced in the field of molecular pathology testing now extends to additional

diagnostic testing codes on the Clinical Laboratory Fee Schedule (CLFS). If there are not adequate reimbursement

levels, our business and results of operations could be adversely affected.

Our customers include researchers at pharmaceutical and biotechnology companies, academic institutions, and

government and private laboratories. Fluctuations in the research and development budgets of these organizations

could have a significant adverse effect on demand for our products. Research and development budgets are affected

by changes in available resources, the mergers of pharmaceutical and biotechnology companies, changes in

spending priorities and institutional budgetary policies. Our results of operations could be adversely affected by any

significant decrease in expenditures for life sciences research and development by pharmaceutical and

biotechnology companies, academic institutions, and government and private laboratories. In addition, short-term
changes in administrative, regulatory or purchasing-related procedures can create uncertainties or other impediments
M A N A G E M E N T   R E P O R T Opportunities and Risks
that can have an adverse impact on our results of operations.

In recent years, the pharmaceutical and biotechnology industries have undergone substantial restructuring and
consolidation. Additional mergers or consolidation within the pharmaceutical and biotechnology industries could
cause us to lose existing customers and potential future customers, which could have a material adverse impact on
our results of operations.

Approximately 25% of our sales are generated from demand for our products used at universities, government
laboratories and private foundations, and whose funding is dependent upon grants from government agencies, such
as the NIH (National Institutes of Health) in the United States. Although the level of research funding has been
increasing in recent years, we cannot assure you that this trend will continue given federal and state budget
constraints. Government funding of research and development is subject to the political process, which is inherently
unpredictable. Future sales may be adversely affected if our customers delay purchases as a result of uncertainties
regarding the approval of government or industrial budget proposals. Also, government proposals to reduce or
eliminate budgetary deficits have sometimes included reduced allocations to the NIH and government agencies in
other countries that fund life sciences research and development activities. A reduction in government funding for the
NIH or government research agencies in other countries could have a serious adverse impact on our results of
operations.

The markets for most of our products are very competitive. Competitors may have significant advantages in financial,
operational, sales and marketing resources as well as experience in research and development. These competitors
may have developed, or could develop in the future, new technologies that compete with our products or even
render our products obsolete. Some competitors may obtain regulatory approval from the FDA or similar non-U.S.
authorities and market approved products. Our competitors’ development of alternative products offering superior
technology, greater cost-effectiveness or regulatory approval could have a material adverse effect on our sales and
results of operations.

The growth of our business depends in part on the continued conversion of users from competitive products to our
sample and assay technologies and other solutions. Lack of conversion could have a material adverse effect on our
sales and results of operations.

It can be difficult for users of our products to switch from their current supplier of a particular product, primarily due
to the time and expense required to properly integrate new products into their operations. As a result, if we are
unable to be the first to develop and supply new products, our competitive position may suffer, resulting in a material
adverse effect on our sales and results of operations.

For our commercial clinical assays, we often compete with solutions developed by our laboratory customers, and
driving conversion from such laboratory-developed tests (LDTs) to commercial diagnostics assays can be challenging.

We and our customers operate in a highly regulated environment characterized by frequent changes in the
governing regulatory framework. Genetic research activities and products commonly referred to as “genetically
engineered” (such as certain food and therapeutic products) are subject to extensive governmental regulation in most
developed countries, especially in the major markets for pharmaceutical and diagnostic products such as the
European Union, the U.S., China and Japan. In recent years, several highly publicized scientific events (notably in
genomic research, gene editing and cloning) have prompted intense public debates on the ethical, philosophical and
religious implications of an unlimited expansion in genetic research and the use of products emerging from this
research. As a result of this debate, some key countries may increase or establish regulatory barriers, which could
adversely affect demand for our products and prevent us from fulfilling our growth expectations. Furthermore, there
can be no assurance that any future changes in applicable regulations will not require further expenditures or an
alteration, suspension or liquidation of our operations in certain areas, or even in their entirety.

Changes in the existing regulations or adoption of new requirements or policies could adversely affect our ability to
sell our approved or cleared products or to seek approvals for new products in other countries around the world.
Sales of certain products now in development may be dependent upon us successfully conducting pre-clinical studies,
61
clinical trials and other tasks required to gain regulatory approvals and meet other requirements from the FDA in the
U.S., and regulatory agencies in other countries. If we are not able to meet the applicable requirements, we will not

be able to commercialize our products and tests, which will have a material adverse effect on our business.

Several of our key products and programs are medical devices that are subject to extensive regulation by the FDA

under the U.S. Food, Drug and Cosmetic Act. We plan to apply for FDA clearance or approval of additional

products in the future. Regulatory agencies in other countries also have medical device and IVD approval

requirements that are becoming more extensive. These regulations govern most commercial activities associated with

medical devices, including indications for the use of these products as well as other aspects that include product

development, testing, manufacturing, labeling, storage, record-keeping, advertising and promotion. Compliance with

these regulations is expensive and time-consuming.

Our cleared or approved devices, including diagnostic tests and related equipment, are subject to numerous post-

approval requirements. We are subject to inspection and marketing surveillance by the FDA to determine our

compliance with regulatory requirements. If the FDA determines that we have failed to comply, it can institute a wide

variety of enforcement actions, ranging from warning letters to more severe sanctions such as fines, injunctions and

civil penalties, recalls or seizures of our products, operating restrictions, partial suspension or total shutdown of

production, denial of our requests for 510(k) clearance or pre-market approval of product candidates, withdrawal of

510(k) clearance or pre-market approval already granted and civil or criminal prosecution. Any enforcement action

by the FDA may affect our ability to commercially distribute these products in the U.S.

Some of our products are sold for research purposes in the U.S. We do not promote these products for clinical

diagnostic use, and they are labeled “For Research Use Only” (RUO) or “for molecular biology applications.” If the

FDA were to disagree with our designation of a product as having RUO status, we could be forced to stop selling it

until appropriate regulatory clearance or approval has been obtained.

Reduction in research and development budgets and government funding may resultin reduced sales.Competition could reduce our sales.The time and expense needed to obtain regulatory approval and respond to changesin regulatory requirements could adversely affect our ability to commerciallydistribute our products and generate sales.Changes in tax laws or their application or the termination or reduction of certaingovernment tax incentives, could adversely impact our overall effective tax rate,results of operations or financial flexibility.unable to be the first to develop and supply new products, our competitive position may suffer, resulting in a material

adverse effect on our sales and results of operations.

For our commercial clinical assays, we often compete with solutions developed by our laboratory customers, and

driving conversion from such laboratory-developed tests (LDTs) to commercial diagnostics assays can be challenging.

We and our customers operate in a highly regulated environment characterized by frequent changes in the

governing regulatory framework. Genetic research activities and products commonly referred to as “genetically

engineered” (such as certain food and therapeutic products) are subject to extensive governmental regulation in most
developed countries, especially in the major markets for pharmaceutical and diagnostic products such as the
European Union, the U.S., China and Japan. In recent years, several highly publicized scientific events (notably in
genomic research, gene editing and cloning) have prompted intense public debates on the ethical, philosophical and
religious implications of an unlimited expansion in genetic research and the use of products emerging from this
research. As a result of this debate, some key countries may increase or establish regulatory barriers, which could
adversely affect demand for our products and prevent us from fulfilling our growth expectations. Furthermore, there
can be no assurance that any future changes in applicable regulations will not require further expenditures or an
alteration, suspension or liquidation of our operations in certain areas, or even in their entirety.

Changes in the existing regulations or adoption of new requirements or policies could adversely affect our ability to
sell our approved or cleared products or to seek approvals for new products in other countries around the world.
Sales of certain products now in development may be dependent upon us successfully conducting pre-clinical studies,
clinical trials and other tasks required to gain regulatory approvals and meet other requirements from the FDA in the
U.S., and regulatory agencies in other countries. If we are not able to meet the applicable requirements, we will not
be able to commercialize our products and tests, which will have a material adverse effect on our business.

Several of our key products and programs are medical devices that are subject to extensive regulation by the FDA
under the U.S. Food, Drug and Cosmetic Act. We plan to apply for FDA clearance or approval of additional
products in the future. Regulatory agencies in other countries also have medical device and IVD approval
requirements that are becoming more extensive. These regulations govern most commercial activities associated with
medical devices, including indications for the use of these products as well as other aspects that include product
development, testing, manufacturing, labeling, storage, record-keeping, advertising and promotion. Compliance with
these regulations is expensive and time-consuming.

Our cleared or approved devices, including diagnostic tests and related equipment, are subject to numerous post-
approval requirements. We are subject to inspection and marketing surveillance by the FDA to determine our
compliance with regulatory requirements. If the FDA determines that we have failed to comply, it can institute a wide
variety of enforcement actions, ranging from warning letters to more severe sanctions such as fines, injunctions and
civil penalties, recalls or seizures of our products, operating restrictions, partial suspension or total shutdown of
production, denial of our requests for 510(k) clearance or pre-market approval of product candidates, withdrawal of
510(k) clearance or pre-market approval already granted and civil or criminal prosecution. Any enforcement action
by the FDA may affect our ability to commercially distribute these products in the U.S.

Some of our products are sold for research purposes in the U.S. We do not promote these products for clinical
diagnostic use, and they are labeled “For Research Use Only” (RUO) or “for molecular biology applications.” If the
FDA were to disagree with our designation of a product as having RUO status, we could be forced to stop selling it
until appropriate regulatory clearance or approval has been obtained.

Our effective tax rate reflects the benefit of some income being partially exempt from income taxes due to various
intercompany operating and financing activities. The benefit also derives from our global operations, where income
or loss in some jurisdictions is taxed at rates higher or lower than The Netherlands’ statutory rate of 25%. Changes in
tax laws or their application with respect to matters such as changes in tax rates, transfer pricing and income
allocation, utilization of tax loss carryforwards, intercompany dividends, controlled corporations, and limitations on
the deductibility of interest and foreign related-party expenses, and changes to tax credit mechanisms, could increase
our effective tax rate and adversely affect our results of operations and limit our ability to repurchase our Common
Shares without experiencing adverse tax consequences. The increased tax burden as a result of changes in law may
adversely affect our results of operations. Additionally, if our tax positions are challenged by tax authorities or other
governmental bodies, such as the European Commission, we could incur additional tax liabilities, which could have
an adverse effect on our results of operations or financial flexibility.

The biotechnology industry has been characterized by extensive litigation regarding patents and other intellectual
property rights, particularly since industry competitors gravitate around common technology platforms. We are
aware that patents have been applied for and/or issued to third parties claiming technologies for sample and assay
technologies that are closely related to those we use. From time to time, we receive inquiries requesting confirmation
that we do not infringe patents of third parties. We endeavor to follow developments in this field, and we do not
believe that our technologies or products infringe any proprietary rights of third parties. However, there can be no
62
assurance that third parties will not challenge our activities or, if so challenged, that we will prevail. In addition, the
patent and proprietary rights of others could require that we alter our products or processes, pay licensing fees or
cease certain activities, and there can be no assurance that we will be able to license any technologies that we may

require on acceptable terms. In addition, litigation, including proceedings that may be declared by the U.S. Patent

and Trademark Office or the International Trade Commission, may be necessary to respond to any assertions of

infringement, enforce our patent rights and/or determine the scope and validity of our proprietary rights or those of

third parties. Litigation, or threatened litigation, could involve substantial cost, and there can be no assurance that we

would prevail in any proceedings.

Our long-term business strategy involves entering into strategic alliances as well as marketing and distribution

arrangements with academic, corporate and other partners relating to the development, commercialization,

marketing and distribution of certain of our existing and potential products. We may be unable to continue to

negotiate these collaborative arrangements on acceptable terms, and these relationships also may not be

scientifically or commercially successful. In addition, we may be unable to maintain these relationships, and our

collaborative partners may pursue or develop competing products or technologies, either on their own or in

collaboration with others.

Our Precision Medicine business includes projects with pharmaceutical and biotechnology companies to co-develop

companion diagnostics paired with drugs that those companies either market currently or are developing for future

use. The success of these co-development programs, including regulatory approvals for the companion diagnostics,

depends upon the continued commitment of our partners to development of their drugs, the outcome of clinical trials

for the drugs and diagnostics, and regulatory approvals of the tests and drugs. In addition, the future level of sales

for companion diagnostics depends to a high degree on the commercial success of the related medicines for which

the tests have been designed. More companion diagnostics would be sold in combination with a widely prescribed

drug than one with limited use.

The successful marketing of QIAGEN products, in some cases, depends on commercial relationships such as joint

ventures or distributorships, particularly in emerging markets where we partner with local companies to augment our

less-established commercial relationships and infrastructure. The continued commitment of our partners to these

ventures, as well as the management of the commercial efforts, will influence QIAGEN's sales and profitability in

these markets.

The time and expense needed to obtain regulatory approval and respond to changesin regulatory requirements could adversely affect our ability to commerciallydistribute our products and generate sales.Changes in tax laws or their application or the termination or reduction of certaingovernment tax incentives, could adversely impact our overall effective tax rate,results of operations or financial flexibility.We are subject to risks associated with patent litigation.We rely on collaborative commercial relationships to develop and/or market some ofour products.Our effective tax rate reflects the benefit of some income being partially exempt from income taxes due to various

intercompany operating and financing activities. The benefit also derives from our global operations, where income

or loss in some jurisdictions is taxed at rates higher or lower than The Netherlands’ statutory rate of 25%. Changes in

tax laws or their application with respect to matters such as changes in tax rates, transfer pricing and income
allocation, utilization of tax loss carryforwards, intercompany dividends, controlled corporations, and limitations on
M A N A G E M E N T   R E P O R T Opportunities and Risks
the deductibility of interest and foreign related-party expenses, and changes to tax credit mechanisms, could increase
our effective tax rate and adversely affect our results of operations and limit our ability to repurchase our Common
Shares without experiencing adverse tax consequences. The increased tax burden as a result of changes in law may
adversely affect our results of operations. Additionally, if our tax positions are challenged by tax authorities or other
governmental bodies, such as the European Commission, we could incur additional tax liabilities, which could have
an adverse effect on our results of operations or financial flexibility.

The biotechnology industry has been characterized by extensive litigation regarding patents and other intellectual
property rights, particularly since industry competitors gravitate around common technology platforms. We are
aware that patents have been applied for and/or issued to third parties claiming technologies for sample and assay
technologies that are closely related to those we use. From time to time, we receive inquiries requesting confirmation
that we do not infringe patents of third parties. We endeavor to follow developments in this field, and we do not
believe that our technologies or products infringe any proprietary rights of third parties. However, there can be no
assurance that third parties will not challenge our activities or, if so challenged, that we will prevail. In addition, the
patent and proprietary rights of others could require that we alter our products or processes, pay licensing fees or
cease certain activities, and there can be no assurance that we will be able to license any technologies that we may
require on acceptable terms. In addition, litigation, including proceedings that may be declared by the U.S. Patent
and Trademark Office or the International Trade Commission, may be necessary to respond to any assertions of
infringement, enforce our patent rights and/or determine the scope and validity of our proprietary rights or those of
third parties. Litigation, or threatened litigation, could involve substantial cost, and there can be no assurance that we
would prevail in any proceedings.

Our long-term business strategy involves entering into strategic alliances as well as marketing and distribution
arrangements with academic, corporate and other partners relating to the development, commercialization,
marketing and distribution of certain of our existing and potential products. We may be unable to continue to
negotiate these collaborative arrangements on acceptable terms, and these relationships also may not be
scientifically or commercially successful. In addition, we may be unable to maintain these relationships, and our
collaborative partners may pursue or develop competing products or technologies, either on their own or in
collaboration with others.

Our Precision Medicine business includes projects with pharmaceutical and biotechnology companies to co-develop
companion diagnostics paired with drugs that those companies either market currently or are developing for future
use. The success of these co-development programs, including regulatory approvals for the companion diagnostics,
depends upon the continued commitment of our partners to development of their drugs, the outcome of clinical trials
for the drugs and diagnostics, and regulatory approvals of the tests and drugs. In addition, the future level of sales
for companion diagnostics depends to a high degree on the commercial success of the related medicines for which
the tests have been designed. More companion diagnostics would be sold in combination with a widely prescribed
drug than one with limited use.

The successful marketing of QIAGEN products, in some cases, depends on commercial relationships such as joint
ventures or distributorships, particularly in emerging markets where we partner with local companies to augment our
less-established commercial relationships and infrastructure. The continued commitment of our partners to these
ventures, as well as the management of the commercial efforts, will influence QIAGEN's sales and profitability in
these markets.

63

We are subject to risks associated with patent litigation.We rely on collaborative commercial relationships to develop and/or market some ofour products.Our top seven emerging markets are Brazil, Russia, India, China, South Korea, Mexico and Turkey, which together
accounted for approximately 16% of total sales in 2019. We expect to continue to focus on expanding our business
in these or other fast-growing markets, including those in the Middle East and Asia. In addition to the currency and
operating risks described above, our international operations are subject to a variety of risks that include those
arising out of the economy, political outlook, language and cultural barriers in countries where we have operations
or do business. In many of these emerging markets, we may be faced with several risks that are more significant than
in other countries in which we have a history of doing business. These risks include economies that may be
dependent on only a few products and are therefore subject to significant fluctuations, weak legal systems which
may affect our ability to enforce contractual rights, exchange controls, unstable governments, and privatization or
other government actions affecting the flow of goods and currency. In conducting our business, we move products
from one country to another and may provide services in one country from a subsidiary located in another country.
Accordingly, we are vulnerable to abrupt changes in customs and tax regimes that could have significant negative
impacts on our results of operations.

Some of our customers have developed purchasing initiatives to reduce the number of vendors from which they
purchase products to lower their supply costs. In some cases, these customers have established agreements with large
distributors, which include discounts and direct involvement in the distributor’s purchasing process. These activities
may force us to supply large distributors with our products at discounts in order to continue providing products to
some customers. For similar reasons, many larger customers, including the U.S. government, have requested, and
may request in the future, special pricing arrangements, which can include blanket purchase agreements. These
agreements may limit our pricing flexibility, which could harm our business and affect our results of operations. For a
limited number of customers, and at the customers' request, we have conducted sales transactions through
distribution and other value-added partners. If sales grow through these intermediaries, it could have an adverse
impact on our results of operations, particularly a negative impact on our gross profit.

We rely heavily on communications and information systems to conduct our business. In the ordinary course of
business, we collect and store sensitive data, including our own intellectual property and other proprietary business
information and that of our customers, suppliers and business partners, and personally identifiable information of our
customers and employees, in our data centers and on our networks. Our operations rely on the secure processing,
storage and transmission of confidential and other information on our computer systems and networks. We are
transforming to a digital, cloud-leveraging organization, which places our assets, customer data, and personally
identifiable data at a higher risk than in previous years. We have made significant investments to ensure our
employees are aware of cyber security risks facing our company and how to prevent data breaches. We have
modernized our cyber security tools, and are continually modernizing our cyber security processes, in an attempt to
keep pace with evolving cyber security risks. In spite of our efforts, we are unable to completely eliminate these risks
and occasionally experience minor cyber security incidents. External phishing emails (occurring outside of our
computer services) are a growing threat that our customers are facing. These emails could lead to the disclosing of
intellectual property or personally identifiable information, which could lead to financial harm or reputational
damage. While our cyber security team works diligently with our employees around the world, as well as with our
customers, to mitigate these threats by helping to identify and analyze phishing emails, we cannot guarantee that
sensitive data will not be lost or stolen.

A breach in cyber security due to unauthorized access to our computer systems or misuse could include the
misappropriation of assets or sensitive information, the corruption data or other operational disruption. Failures to
64
our computer systems and networks could be caused by internal or external events, such as incursions by intruders or
hackers, computer viruses, failures in hardware or software, or cyber terrorists. If we do experience a breach or

failure of our systems, we could experience potentially significant operational delays resulting from the disruption of

We have made investments in and are expanding our business into emergingmarkets, which exposes us to risks.Some of our customers are requiring us to change our sales arrangements to lowertheir costs, and this may limit our pricing flexibility and harm our business.We are subject to privacy and data security laws and rely on secure communicationand information systems which, in the event of a breach or failure, expose us tosignificant risks.Our top seven emerging markets are Brazil, Russia, India, China, South Korea, Mexico and Turkey, which together

accounted for approximately 16% of total sales in 2019. We expect to continue to focus on expanding our business

in these or other fast-growing markets, including those in the Middle East and Asia. In addition to the currency and

operating risks described above, our international operations are subject to a variety of risks that include those

arising out of the economy, political outlook, language and cultural barriers in countries where we have operations

or do business. In many of these emerging markets, we may be faced with several risks that are more significant than

in other countries in which we have a history of doing business. These risks include economies that may be

dependent on only a few products and are therefore subject to significant fluctuations, weak legal systems which

may affect our ability to enforce contractual rights, exchange controls, unstable governments, and privatization or

other government actions affecting the flow of goods and currency. In conducting our business, we move products

from one country to another and may provide services in one country from a subsidiary located in another country.

Accordingly, we are vulnerable to abrupt changes in customs and tax regimes that could have significant negative

impacts on our results of operations.

Some of our customers have developed purchasing initiatives to reduce the number of vendors from which they

purchase products to lower their supply costs. In some cases, these customers have established agreements with large

distributors, which include discounts and direct involvement in the distributor’s purchasing process. These activities

may force us to supply large distributors with our products at discounts in order to continue providing products to

some customers. For similar reasons, many larger customers, including the U.S. government, have requested, and

may request in the future, special pricing arrangements, which can include blanket purchase agreements. These

agreements may limit our pricing flexibility, which could harm our business and affect our results of operations. For a

limited number of customers, and at the customers' request, we have conducted sales transactions through

distribution and other value-added partners. If sales grow through these intermediaries, it could have an adverse

impact on our results of operations, particularly a negative impact on our gross profit.

We rely heavily on communications and information systems to conduct our business. In the ordinary course of

business, we collect and store sensitive data, including our own intellectual property and other proprietary business

information and that of our customers, suppliers and business partners, and personally identifiable information of our

customers and employees, in our data centers and on our networks. Our operations rely on the secure processing,

storage and transmission of confidential and other information on our computer systems and networks. We are

transforming to a digital, cloud-leveraging organization, which places our assets, customer data, and personally

identifiable data at a higher risk than in previous years. We have made significant investments to ensure our

employees are aware of cyber security risks facing our company and how to prevent data breaches. We have
modernized our cyber security tools, and are continually modernizing our cyber security processes, in an attempt to
keep pace with evolving cyber security risks. In spite of our efforts, we are unable to completely eliminate these risks
M A N A G E M E N T   R E P O R T Opportunities and Risks
and occasionally experience minor cyber security incidents. External phishing emails (occurring outside of our
computer services) are a growing threat that our customers are facing. These emails could lead to the disclosing of
intellectual property or personally identifiable information, which could lead to financial harm or reputational
damage. While our cyber security team works diligently with our employees around the world, as well as with our
customers, to mitigate these threats by helping to identify and analyze phishing emails, we cannot guarantee that
sensitive data will not be lost or stolen.

A breach in cyber security due to unauthorized access to our computer systems or misuse could include the
misappropriation of assets or sensitive information, the corruption data or other operational disruption. Failures to
our computer systems and networks could be caused by internal or external events, such as incursions by intruders or
hackers, computer viruses, failures in hardware or software, or cyber terrorists. If we do experience a breach or
failure of our systems, we could experience potentially significant operational delays resulting from the disruption of
systems, loss due to theft or misappropriation of assets or data, or negative impacts from the loss of confidential data
or intellectual property. We may face significant liability in the event any of the personal information we maintain is
lost or otherwise subject to misuse or other wrongful use, access or disclosure. Further, we could experience negative
publicity resulting in reputation or brand damage with customers or partners.

Additionally, we are subject to privacy and data security laws across multiple jurisdictions, including those relating to
the storage of health information, which are complex, overlapping and rapidly evolving. For example, the California
Consumer Privacy Act of 2018, which took effect on January 1, 2020, imposes expansive new requirements and
protections upon the processing of personal data, aimed at giving California consumers more visibility and control
over their personal information There are also non-U.S. privacy laws, such as the General Data Protection Regulation
(GDPR) of the European Union, that impose restrictions on the transfer, access, use, and disclosure of health and
other personal information. We implemented the requirements set forth by the European Union General Data
Protection Regulation (GDPR), which took effect on May 25, 2018. As our activities continue to evolve and expand,
we may be subject to additional laws which impose further restrictions on the transfer, access, use, and disclosure of
health and other personal information which may impact our business either directly or indirectly. A failure to comply
with applicable privacy or security laws or significant changes in these laws could significantly impact our business
and future business plans. For example, we may be subject to regulatory action or lawsuits in the event we fail to
comply with applicable privacy laws.

Given that we currently market our products throughout the world, a significant portion of our business is conducted
in currencies other than the U.S. dollar, our reporting currency. As a result, fluctuations in value relative to the U.S.
dollar of the currencies in which we conduct our business have caused and will continue to cause foreign currency
transaction gains and losses. Foreign currency transaction gains and losses arising from normal business operations
are charged against earnings in the period when incurred. Due to the number of currencies involved, the variability
of currency exposures and the potential volatility of currency exchange rates, we cannot predict the effects of future
exchange rate fluctuations. While we may engage in foreign exchange hedging transactions to manage our foreign
currency exposure, there can be no assurance that our hedging strategy will adequately protect our operating results
from the effects of future exchange rate fluctuations.

Our business involves operations around the world. Our consumable manufacturing facilities are located in
Germany, the U.S. and China. We have established sales subsidiaries in numerous countries and our products are
sold through independent distributors serving more than 40 additional countries. Our global footprint exposes us to
unforeseen events, such as the January 2020 eruption of the Taal volcano in the Philippines or the December 2019
outbreak of COVID-19 in China. Our facilities may be harmed by unforeseen events, and in the event that we or our
customers are affected by a disaster, we may experience delays or reductions in sales or production, increased
costs, or may be required to identify alternate suppliers and/or rely on third-party manufacturers.

To the extent that our suppliers are impacted by a natural disaster or other disruption, we may experience periods of
reduced production. Any unexpected interruptions in our production capabilities may lead to delayed or lost sales
and may adversely affect our results of operations for the affected period.

In addition, to the extent we temporarily shut down any facility following such an unforeseen event, we may
experience disruptions in our ability to manufacture or ship products to customers or otherwise operate our business.

65

Many of our products are manufactured in a single location and we may experience adverse effects to the extent

these manufacturing operations are disrupted. While our global operations give us the ability to ship product from

alternative sites, we may not be able to do so because our customers’ facilities are shut down or the local logistics

infrastructure is not functioning, and our sales will suffer.

We have made investments in and are expanding our business into emergingmarkets, which exposes us to risks.Some of our customers are requiring us to change our sales arrangements to lowertheir costs, and this may limit our pricing flexibility and harm our business.We are subject to privacy and data security laws and rely on secure communicationand information systems which, in the event of a breach or failure, expose us tosignificant risks.Exchange rate fluctuations may adversely affect our business and operating results.Our global operations may be affected by actions of governments, global or regionaleconomic or public health developments, weather or transportation delays, naturaldisasters or other force majeure events (collectively, unforeseen events) which maynegatively impact our suppliers, ostrong customers or us.systems, loss due to theft or misappropriation of assets or data, or negative impacts from the loss of confidential data

or intellectual property. We may face significant liability in the event any of the personal information we maintain is

lost or otherwise subject to misuse or other wrongful use, access or disclosure. Further, we could experience negative

publicity resulting in reputation or brand damage with customers or partners.

Additionally, we are subject to privacy and data security laws across multiple jurisdictions, including those relating to

the storage of health information, which are complex, overlapping and rapidly evolving. For example, the California

Consumer Privacy Act of 2018, which took effect on January 1, 2020, imposes expansive new requirements and

protections upon the processing of personal data, aimed at giving California consumers more visibility and control

over their personal information There are also non-U.S. privacy laws, such as the General Data Protection Regulation

(GDPR) of the European Union, that impose restrictions on the transfer, access, use, and disclosure of health and

other personal information. We implemented the requirements set forth by the European Union General Data

Protection Regulation (GDPR), which took effect on May 25, 2018. As our activities continue to evolve and expand,

we may be subject to additional laws which impose further restrictions on the transfer, access, use, and disclosure of

health and other personal information which may impact our business either directly or indirectly. A failure to comply

with applicable privacy or security laws or significant changes in these laws could significantly impact our business

and future business plans. For example, we may be subject to regulatory action or lawsuits in the event we fail to

comply with applicable privacy laws.

Given that we currently market our products throughout the world, a significant portion of our business is conducted

in currencies other than the U.S. dollar, our reporting currency. As a result, fluctuations in value relative to the U.S.

dollar of the currencies in which we conduct our business have caused and will continue to cause foreign currency

transaction gains and losses. Foreign currency transaction gains and losses arising from normal business operations

are charged against earnings in the period when incurred. Due to the number of currencies involved, the variability

of currency exposures and the potential volatility of currency exchange rates, we cannot predict the effects of future

exchange rate fluctuations. While we may engage in foreign exchange hedging transactions to manage our foreign

currency exposure, there can be no assurance that our hedging strategy will adequately protect our operating results

from the effects of future exchange rate fluctuations.

Our business involves operations around the world. Our consumable manufacturing facilities are located in
Germany, the U.S. and China. We have established sales subsidiaries in numerous countries and our products are
sold through independent distributors serving more than 40 additional countries. Our global footprint exposes us to
unforeseen events, such as the January 2020 eruption of the Taal volcano in the Philippines or the December 2019
outbreak of COVID-19 in China. Our facilities may be harmed by unforeseen events, and in the event that we or our
customers are affected by a disaster, we may experience delays or reductions in sales or production, increased
costs, or may be required to identify alternate suppliers and/or rely on third-party manufacturers.

To the extent that our suppliers are impacted by a natural disaster or other disruption, we may experience periods of
reduced production. Any unexpected interruptions in our production capabilities may lead to delayed or lost sales
and may adversely affect our results of operations for the affected period.

In addition, to the extent we temporarily shut down any facility following such an unforeseen event, we may
experience disruptions in our ability to manufacture or ship products to customers or otherwise operate our business.
Many of our products are manufactured in a single location and we may experience adverse effects to the extent
these manufacturing operations are disrupted. While our global operations give us the ability to ship product from
alternative sites, we may not be able to do so because our customers’ facilities are shut down or the local logistics
infrastructure is not functioning, and our sales will suffer.

Damage to our property due to unforeseen events and the disruption of our business from casualties may be covered
by insurance, but this insurance may not be sufficient to cover all of our potential losses, and such insurance may not
continue to be available to us on acceptable terms, or at all. In addition, we may incur incremental costs following
an unforeseen event, which will reduce profits and adversely affect our results of operations.

We buy materials to create our products from a number of suppliers and are not dependent on any one supplier or
group of suppliers for our business as a whole. However, key components of certain products, including certain
instrumentation and chemicals, are available only from a single source. If supplies from these vendors are delayed or
interrupted for any reason, we may not be able to obtain these materials timely or in sufficient quantities or qualities
to produce certain products, and this could have an adverse impact on our results of operations.

Our customers in the scientific research markets typically keep only a modest inventory of our products on hand, and
consequently require overnight delivery of purchases. As a result, we heavily rely on air cargo carriers and logistic
suppliers. If overnight services are suspended or delayed, and other delivery carriers and logistic suppliers cannot
provide satisfactory services, customers may suspend a significant amount of their work. The lack of adequate
delivery alternatives would have a serious adverse impact on our results of operations.

Although we have not experienced any difficulties attracting or retaining management and scientific staff, our ability
to recruit and retain qualified, skilled employees will continue to be critical to our success. Given the intense
competition for experienced scientists and managers among pharmaceutical and biotechnology companies, as well
as academic and other research institutions, there can be no assurance that we will be able to attract and retain
employees critical to our success on acceptable terms. Initiatives to expand QIAGEN will also require additional
employees, including management with expertise in areas such as research and development, manufacturing,
digitization, sales and marketing, and the development of existing managers to lead a growing organization. The
failure to recruit and retain qualified employees, or develop existing employees, could have a material adverse
impact on our results of operations. We may face difficulties in hiring and retaining qualified personnel following our
March 3, 2020 announcement of the proposed merger with Thermo Fisher Scientific Inc.

The markets we serve are typically characterized by a high percentage of purchase orders being received in the final
66
few weeks or days of each quarter. Although this varies from quarter to quarter, many customers make a large
portion of their purchase decisions late in each quarter, in particular because they receive new information during

this period on their budgets and requirements. Additionally, volatility in the timing of revenue from companion

diagnostic partnerships can be difficult to predict. As a result, even late in each quarter, we cannot predict with

certainty whether our sales forecasts for the quarter will be achieved.

Historically, we have been able to rely on the overall pattern of customer purchase orders during prior periods to

project with reasonable accuracy our anticipated sales for the current or coming quarters. However, if customer

purchasing trends during a quarter vary from historical patterns as may occur with changes in market and economic

conditions our quarterly financial results could deviate significantly from our projections. As a result, our sales

forecasts for any given quarter may prove not to be accurate. We also may not have sufficient, timely information to

confirm or revise our sales projections for a specific quarter. If we fail to achieve our forecasted sales for a particular

quarter, the value of our Common Shares could be significantly affected.

Exchange rate fluctuations may adversely affect our business and operating results.Our global operations may be affected by actions of governments, global or regionaleconomic or public health developments, weather or transportation delays, naturaldisasters or other force majeure events (collectively, unforeseen events) which maynegatively impact our suppliers, ostrong customers or us.We depend on suppliers for materials used to manufacture our products, and ifshipments from these suppliers are delayed or interrupted, we may be unable tomanufacture our products.We heavily rely on air cargo carriers and other overnight logistics services, andshipping delays or interruptions could harm our business.Our success depends on the continued employment of qualified personnel, any ofwhom we may lose at any time.Our ability to accurately forecast our results during each quarter may be negativelyimpacted by the fact that a substantial percentage of our sales may be recorded inthe final weeks or days of the quarter.Damage to our property due to unforeseen events and the disruption of our business from casualties may be covered

by insurance, but this insurance may not be sufficient to cover all of our potential losses, and such insurance may not

continue to be available to us on acceptable terms, or at all. In addition, we may incur incremental costs following

an unforeseen event, which will reduce profits and adversely affect our results of operations.

We buy materials to create our products from a number of suppliers and are not dependent on any one supplier or

group of suppliers for our business as a whole. However, key components of certain products, including certain

instrumentation and chemicals, are available only from a single source. If supplies from these vendors are delayed or

interrupted for any reason, we may not be able to obtain these materials timely or in sufficient quantities or qualities

to produce certain products, and this could have an adverse impact on our results of operations.

Our customers in the scientific research markets typically keep only a modest inventory of our products on hand, and

consequently require overnight delivery of purchases. As a result, we heavily rely on air cargo carriers and logistic

suppliers. If overnight services are suspended or delayed, and other delivery carriers and logistic suppliers cannot

provide satisfactory services, customers may suspend a significant amount of their work. The lack of adequate

delivery alternatives would have a serious adverse impact on our results of operations.

Although we have not experienced any difficulties attracting or retaining management and scientific staff, our ability

to recruit and retain qualified, skilled employees will continue to be critical to our success. Given the intense

competition for experienced scientists and managers among pharmaceutical and biotechnology companies, as well

as academic and other research institutions, there can be no assurance that we will be able to attract and retain
employees critical to our success on acceptable terms. Initiatives to expand QIAGEN will also require additional
M A N A G E M E N T   R E P O R T Opportunities and Risks
employees, including management with expertise in areas such as research and development, manufacturing,
digitization, sales and marketing, and the development of existing managers to lead a growing organization. The
failure to recruit and retain qualified employees, or develop existing employees, could have a material adverse
impact on our results of operations. We may face difficulties in hiring and retaining qualified personnel following our
March 3, 2020 announcement of the proposed merger with Thermo Fisher Scientific Inc.

The markets we serve are typically characterized by a high percentage of purchase orders being received in the final
few weeks or days of each quarter. Although this varies from quarter to quarter, many customers make a large
portion of their purchase decisions late in each quarter, in particular because they receive new information during
this period on their budgets and requirements. Additionally, volatility in the timing of revenue from companion
diagnostic partnerships can be difficult to predict. As a result, even late in each quarter, we cannot predict with
certainty whether our sales forecasts for the quarter will be achieved.

Historically, we have been able to rely on the overall pattern of customer purchase orders during prior periods to
project with reasonable accuracy our anticipated sales for the current or coming quarters. However, if customer
purchasing trends during a quarter vary from historical patterns as may occur with changes in market and economic
conditions our quarterly financial results could deviate significantly from our projections. As a result, our sales
forecasts for any given quarter may prove not to be accurate. We also may not have sufficient, timely information to
confirm or revise our sales projections for a specific quarter. If we fail to achieve our forecasted sales for a particular
quarter, the value of our Common Shares could be significantly affected.

We have a significant amount of debt and debt service obligations and restrictive covenants imposed by our lenders.
A high level of indebtedness increases the risk that we may default on our debt obligations and restrictive covenants
may prevent us from borrowing additional funds. There is no assurance that we will be able to generate sufficient
cash flow to pay the interest on our debt and comply with our debt covenants or that future working capital,
borrowings or equity financing will be available to repay or refinance our debt. If we are unable to generate
sufficient cash flow to pay the interest on our debt and comply with our debt covenants, we may have to delay or
curtail our research and development programs. The level of our indebtedness could, among other things:

›

make it difficult for us to make required payments on our debt;

›

›

make it difficult for us to obtain financing in the future necessary for working capital, capital expenditures, debt
service requirements or other purposes;

limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we compete;
and

›

make us more vulnerable in the event of a downturn in our business.

The Financial Conduct Authority of the United Kingdom plans to phase out the London Interbank Offered Rate (LIBOR)
by the end of 2021. Presently, we do hold debt and derivative instruments that use LIBOR. While certain agreements
do contain language for the determination of interest rates in the event the LIBOR rate is not available, changes to
these agreements may be required, and we could be negatively impacted by any newly determined alternative
benchmark.

Our future capital requirements and level of expenses will depend upon numerous factors, including the costs
associated with:

›

marketing, sales and customer support efforts;

›

research and development activities;

›

expansion of our facilities;

›

consummation of possible future acquisitions of technologies, products or businesses;

›

demand for our products and services;

›

repayment or refinancing of debt; and

›

payments in connection with our hedging activities and/or taxes.

67

We currently anticipate that our short-term capital requirements will be satisfied by cash flow from our operations

and/or cash on hand. As of December 31, 2019, we had outstanding long-term debt of $1.7 billion, of which

$285.2 million was current. We may need to refinance all or part of these liabilities before or at their contractual

maturities.

If at some point in time our existing resources should be insufficient to fund our activities, we may need to raise funds

through public or private debt or equity financings. The funds for the refinancing of existing liabilities or for the

ongoing funding of our business may not be available or, if available, not on terms acceptable to us. If adequate

funds are not available, we may be required to reduce or delay expenditures for research and development,

production, marketing, capital expenditures and/or acquisitions, which could have a material adverse effect on our

business and results of operations. To the extent that additional capital is raised through the sale of equity or

convertible securities, the issuance of any securities could result in dilution to our shareholders.

We have a significant amount of debt that may adversely affect our financialcondition and flexibility.Our business may require substantial additional capital, which we may not be able toobtain on terms acceptable to us, if at all.We depend on suppliers for materials used to manufacture our products, and ifshipments from these suppliers are delayed or interrupted, we may be unable tomanufacture our products.We heavily rely on air cargo carriers and other overnight logistics services, andshipping delays or interruptions could harm our business.Our success depends on the continued employment of qualified personnel, any ofwhom we may lose at any time.Our ability to accurately forecast our results during each quarter may be negativelyimpacted by the fact that a substantial percentage of our sales may be recorded inthe final weeks or days of the quarter.We have a significant amount of debt and debt service obligations and restrictive covenants imposed by our lenders.

A high level of indebtedness increases the risk that we may default on our debt obligations and restrictive covenants

may prevent us from borrowing additional funds. There is no assurance that we will be able to generate sufficient

cash flow to pay the interest on our debt and comply with our debt covenants or that future working capital,

borrowings or equity financing will be available to repay or refinance our debt. If we are unable to generate

sufficient cash flow to pay the interest on our debt and comply with our debt covenants, we may have to delay or

curtail our research and development programs. The level of our indebtedness could, among other things:

›

make it difficult for us to make required payments on our debt;

›

make it difficult for us to obtain financing in the future necessary for working capital, capital expenditures, debt

service requirements or other purposes;

›

limit our flexibility in planning for, or reacting to, changes in our business and the industry in which we compete;

and

›

make us more vulnerable in the event of a downturn in our business.

The Financial Conduct Authority of the United Kingdom plans to phase out the London Interbank Offered Rate (LIBOR)
by the end of 2021. Presently, we do hold debt and derivative instruments that use LIBOR. While certain agreements
do contain language for the determination of interest rates in the event the LIBOR rate is not available, changes to
these agreements may be required, and we could be negatively impacted by any newly determined alternative
benchmark.

Our future capital requirements and level of expenses will depend upon numerous factors, including the costs
associated with:

›

marketing, sales and customer support efforts;

›

research and development activities;

›

expansion of our facilities;

›

consummation of possible future acquisitions of technologies, products or businesses;

›

demand for our products and services;

›

repayment or refinancing of debt; and

›

payments in connection with our hedging activities and/or taxes.

We currently anticipate that our short-term capital requirements will be satisfied by cash flow from our operations
and/or cash on hand. As of December 31, 2019, we had outstanding long-term debt of $1.7 billion, of which
$285.2 million was current. We may need to refinance all or part of these liabilities before or at their contractual
maturities.

If at some point in time our existing resources should be insufficient to fund our activities, we may need to raise funds
through public or private debt or equity financings. The funds for the refinancing of existing liabilities or for the
ongoing funding of our business may not be available or, if available, not on terms acceptable to us. If adequate
funds are not available, we may be required to reduce or delay expenditures for research and development,
production, marketing, capital expenditures and/or acquisitions, which could have a material adverse effect on our
business and results of operations. To the extent that additional capital is raised through the sale of equity or
convertible securities, the issuance of any securities could result in dilution to our shareholders.

We will settle any conversions of the Cash Convertible Notes described under the heading “Other Factors Affecting
Liquidity and Capital Resources” elsewhere in this report, entirely in cash. Accordingly, the conversion option that is
part of the Cash Convertible Notes will be accounted for as a derivative pursuant to accounting standards relating to
derivative instruments and hedging activities. Refer to Note 14 "Derivatives and Hedging" and Note 16 "Lines of
Credit and Debt", of the Notes to Consolidated Financial Statements. In general, this resulted in an initial valuation
of the conversion option separate from the debt component of the Cash Convertible Notes, resulting in an original
issue discount. The original issue discount will be accreted to interest expense over the term of the Cash Convertible
Notes, which will result in an effective interest rate reported in our financial statements significantly in excess of the
stated coupon rates of the Cash Convertible Notes. This accounting treatment will reduce our earnings. For each
financial statement period after the issuance of the Cash Convertible Notes, a gain (or loss) will be reported in our
financial statements to the extent the valuation of the conversion option changes from the previous period. The Call
Options issued in connection with the Cash Convertible Notes will also be accounted for as derivative instruments,
substantially offsetting the gain (or loss) associated with changes to the valuation of the conversion option. This may
result in increased volatility to our results of operations.

68

Concurrently with the issuance of the Cash Convertible Notes, we entered into Call Options and issued Warrants.

We entered into the Call Options with the expectation that they would offset potential cash payments by us in excess

of the principal amount of the Cash Convertible Notes upon conversion of the Cash Convertible Notes. In the event

that the hedge counterparties fail to deliver potential cash payments to us, as required under the Call Options, we

would not receive the benefit of such transaction. Separately, we also issued Warrants. The Warrants could

separately have a dilutive effect to the extent that the market price per share of our common stock, as measured

under the terms of the Warrants, exceeds the strike price of the Warrants.

At December 31, 2019, our consolidated balance sheet reflected $2.1 billion of goodwill and $632.4 million of

intangible assets. Goodwill is recorded when the purchase price of a business exceeds the fair value of the tangible

and separately measurable intangible net assets. U.S. generally accepted accounting principles (U.S. GAAP) require

us to test goodwill for impairment on an annual basis or when events or circumstances occur indicating that goodwill

might be impaired. Long-lived assets, such as intangible assets with finite useful lives, are reviewed for impairment

whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The

impairment review often cannot be done at the level of the individual asset and it must instead be applied to a group

of assets. For the purpose of our annual goodwill impairment testing based on the current circumstances of how we

manage our business, this group of assets is the Company as a whole. If we determine that any of our goodwill or

intangible assets were impaired, we will be required to take an immediate charge to earnings and our results of

operations could be adversely affected.

We have made, and may continue to make, strategic investments in businesses as opportunities arise. We

periodically review the carrying value of these investments for impairment, considering factors that include the most

recent stock transactions, book values from the most recent financial statements, and forecasts and expectations of

the investee. The results of these valuations may fluctuate due to market conditions and other conditions over which

we have no control.

Estimating the fair value of non-marketable equity investments in life science companies is inherently subjective. If

actual events differ from our assumptions and unfavorable fluctuations in the valuations of the investments are

indicated, we could be required to write down the investment. This could result in future charges on our earnings that

We have a significant amount of debt that may adversely affect our financialcondition and flexibility.Our business may require substantial additional capital, which we may not be able toobtain on terms acceptable to us, if at all.The accounting for the cash convertible notes we have issued will result in recognitionof interest expense significantly greater than the stated interest rate of the notes andmay result in volatility to our Consolidated Statements of Income.The cash convertible note hedge and warrant transactions we entered into inconnection with the issuance of our Cash Convertible Notes may not provide thebenefits we anticipate, and may have a dilutive effect on our common stock.An impairment of goodwill and intangible assets could reduce our earnings.Our strategic equity investments may result in losses.We will settle any conversions of the Cash Convertible Notes described under the heading “Other Factors Affecting

Liquidity and Capital Resources” elsewhere in this report, entirely in cash. Accordingly, the conversion option that is

part of the Cash Convertible Notes will be accounted for as a derivative pursuant to accounting standards relating to

derivative instruments and hedging activities. Refer to Note 14 "Derivatives and Hedging" and Note 16 "Lines of

Credit and Debt", of the Notes to Consolidated Financial Statements. In general, this resulted in an initial valuation

of the conversion option separate from the debt component of the Cash Convertible Notes, resulting in an original

issue discount. The original issue discount will be accreted to interest expense over the term of the Cash Convertible
Notes, which will result in an effective interest rate reported in our financial statements significantly in excess of the
M A N A G E M E N T   R E P O R T Opportunities and Risks
stated coupon rates of the Cash Convertible Notes. This accounting treatment will reduce our earnings. For each
financial statement period after the issuance of the Cash Convertible Notes, a gain (or loss) will be reported in our
financial statements to the extent the valuation of the conversion option changes from the previous period. The Call
Options issued in connection with the Cash Convertible Notes will also be accounted for as derivative instruments,
substantially offsetting the gain (or loss) associated with changes to the valuation of the conversion option. This may
result in increased volatility to our results of operations.

Concurrently with the issuance of the Cash Convertible Notes, we entered into Call Options and issued Warrants.
We entered into the Call Options with the expectation that they would offset potential cash payments by us in excess
of the principal amount of the Cash Convertible Notes upon conversion of the Cash Convertible Notes. In the event
that the hedge counterparties fail to deliver potential cash payments to us, as required under the Call Options, we
would not receive the benefit of such transaction. Separately, we also issued Warrants. The Warrants could
separately have a dilutive effect to the extent that the market price per share of our common stock, as measured
under the terms of the Warrants, exceeds the strike price of the Warrants.

At December 31, 2019, our consolidated balance sheet reflected $2.1 billion of goodwill and $632.4 million of
intangible assets. Goodwill is recorded when the purchase price of a business exceeds the fair value of the tangible
and separately measurable intangible net assets. U.S. generally accepted accounting principles (U.S. GAAP) require
us to test goodwill for impairment on an annual basis or when events or circumstances occur indicating that goodwill
might be impaired. Long-lived assets, such as intangible assets with finite useful lives, are reviewed for impairment
whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The
impairment review often cannot be done at the level of the individual asset and it must instead be applied to a group
of assets. For the purpose of our annual goodwill impairment testing based on the current circumstances of how we
manage our business, this group of assets is the Company as a whole. If we determine that any of our goodwill or
intangible assets were impaired, we will be required to take an immediate charge to earnings and our results of
operations could be adversely affected.

We have made, and may continue to make, strategic investments in businesses as opportunities arise. We
periodically review the carrying value of these investments for impairment, considering factors that include the most
recent stock transactions, book values from the most recent financial statements, and forecasts and expectations of
the investee. The results of these valuations may fluctuate due to market conditions and other conditions over which
we have no control.

Estimating the fair value of non-marketable equity investments in life science companies is inherently subjective. If
actual events differ from our assumptions and unfavorable fluctuations in the valuations of the investments are
indicated, we could be required to write down the investment. This could result in future charges on our earnings that
could materially adversely affect our results of operations. It is uncertain whether or not we will realize any long-term
benefits from these strategic investments.

Our business involves operations in several countries outside of the U.S. Our consumable manufacturing facilities are
located in Germany, China and the U.S. We source raw materials and subcomponents to manufacture our products
from different countries. We have established sales subsidiaries in many countries. In addition, our products are sold
through independent distributors serving more than 40 other countries. Conducting and launching operations on an
international scale requires close coordination of activities across multiple jurisdictions and time zones and consumes
significant management resources. We have invested heavily in computerized information systems in order to
manage more efficiently the widely dispersed components of our operations. If we fail to coordinate and manage
these activities effectively, our business and results of operations will be adversely affected.

Our operations are subject to other risks inherent in international business activities, such as the general economic
and public health conditions in the countries in which we operate, trade restrictions and changes in tariffs, longer
accounts receivable payment cycles in certain countries, overlap of different tax structures, unexpected changes in
regulatory requirements, and compliance with a variety of foreign laws and regulations. Other risks associated with
international operations include import and export licensing requirements, exchange controls and changes in freight
rates, as may occur as a result of rising energy costs. As a result of these conditions, an inability to successfully

69

manage our international operations could have a material adverse impact on our business and results of operations.

Our business in countries with a history of corruption and transactions with foreign governments increases the risks

associated with our international activities. Based on our international operations, we are subject to the U.S. Foreign

Corrupt Practices Act (FCPA), the U.K. Bribery Act and other laws that prohibit improper payments or offers of

payments to foreign governments and their officials and political parties by business entities for the purpose of

obtaining or retaining business. We have operations, agreements with third parties and sales in countries known to

experience corruption. Further international expansion may involve increased exposure to such practices. Our

activities in these countries and others create risks of unauthorized payments or offers of payments, non-compliance

with laws, or other unethical behavior by any of our employees, consultants, sales agents or distributors, that could

be in violation of various laws, including the FCPA, even though these parties are not always subject to our control.

Our policy is to implement safeguards to discourage these or other unethical practices by our employees and

distributors including online and in-person employee trainings, periodic internal audits and standard reviews of our

distributors. However, our existing safeguards and any future improvements may not prove to be effective, and our

employees, consultants, sales agents or distributors may engage in conduct for which we might be held responsible.

Violations of the FCPA and other laws may result in criminal or civil sanctions, which could be severe, and we may

be subject to other liabilities, which could negatively affect our business, results of operations and financial

condition.

Our success depends to a large extent on our ability to develop proprietary products and technologies and to

establish and protect our patent and trademark rights in these products and technologies. As of December 31, 2019,

we owned 352 issued patents in the United States, 275 issued patents in Germany and 1,700 issued patents in

other major industrialized countries. In addition, at December 31, 2019, we had 558 pending patent applications,

and we intend to file applications for additional patents as our products and technologies are developed. The patent

positions of technology-based companies involve complex legal and factual questions and may be uncertain, and the

laws governing the scope of patent coverage and the periods of enforceability of patent protection are subject to

change. In addition, patent applications in the United States are maintained in secrecy until patents issue, and

publication of discoveries in the scientific or patent literature tends to lag behind actual discoveries by several

months. Therefore, no assurance can be given that patents will issue from any patent applications that we own or

license, or if patents do issue, that the claims allowed will be sufficiently broad to protect our technology. In addition,

no assurance can be given that any issued patents that we own or license will not be challenged, invalidated or

The accounting for the cash convertible notes we have issued will result in recognitionof interest expense significantly greater than the stated interest rate of the notes andmay result in volatility to our Consolidated Statements of Income.The cash convertible note hedge and warrant transactions we entered into inconnection with the issuance of our Cash Convertible Notes may not provide thebenefits we anticipate, and may have a dilutive effect on our common stock.An impairment of goodwill and intangible assets could reduce our earnings.Our strategic equity investments may result in losses.Doing business internationally creates certain risks.Unethical behavior and non-compliance with laws by our sales representatives, otheremployees, consultants, commercial partners or distributors or employees couldseriously harm our business.We depend on patents and proprietary rights that may fail to protect our business.could materially adversely affect our results of operations. It is uncertain whether or not we will realize any long-term

benefits from these strategic investments.

Our business involves operations in several countries outside of the U.S. Our consumable manufacturing facilities are
located in Germany, China and the U.S. We source raw materials and subcomponents to manufacture our products
from different countries. We have established sales subsidiaries in many countries. In addition, our products are sold
through independent distributors serving more than 40 other countries. Conducting and launching operations on an
international scale requires close coordination of activities across multiple jurisdictions and time zones and consumes
significant management resources. We have invested heavily in computerized information systems in order to
manage more efficiently the widely dispersed components of our operations. If we fail to coordinate and manage
these activities effectively, our business and results of operations will be adversely affected.

Our operations are subject to other risks inherent in international business activities, such as the general economic
and public health conditions in the countries in which we operate, trade restrictions and changes in tariffs, longer
accounts receivable payment cycles in certain countries, overlap of different tax structures, unexpected changes in
regulatory requirements, and compliance with a variety of foreign laws and regulations. Other risks associated with
international operations include import and export licensing requirements, exchange controls and changes in freight
rates, as may occur as a result of rising energy costs. As a result of these conditions, an inability to successfully
manage our international operations could have a material adverse impact on our business and results of operations.

Our business in countries with a history of corruption and transactions with foreign governments increases the risks
associated with our international activities. Based on our international operations, we are subject to the U.S. Foreign
Corrupt Practices Act (FCPA), the U.K. Bribery Act and other laws that prohibit improper payments or offers of
payments to foreign governments and their officials and political parties by business entities for the purpose of
obtaining or retaining business. We have operations, agreements with third parties and sales in countries known to
experience corruption. Further international expansion may involve increased exposure to such practices. Our
activities in these countries and others create risks of unauthorized payments or offers of payments, non-compliance
with laws, or other unethical behavior by any of our employees, consultants, sales agents or distributors, that could
be in violation of various laws, including the FCPA, even though these parties are not always subject to our control.
Our policy is to implement safeguards to discourage these or other unethical practices by our employees and
distributors including online and in-person employee trainings, periodic internal audits and standard reviews of our
distributors. However, our existing safeguards and any future improvements may not prove to be effective, and our
employees, consultants, sales agents or distributors may engage in conduct for which we might be held responsible.
Violations of the FCPA and other laws may result in criminal or civil sanctions, which could be severe, and we may
be subject to other liabilities, which could negatively affect our business, results of operations and financial
condition.

Our success depends to a large extent on our ability to develop proprietary products and technologies and to
establish and protect our patent and trademark rights in these products and technologies. As of December 31, 2019,
we owned 352 issued patents in the United States, 275 issued patents in Germany and 1,700 issued patents in
other major industrialized countries. In addition, at December 31, 2019, we had 558 pending patent applications,
and we intend to file applications for additional patents as our products and technologies are developed. The patent
positions of technology-based companies involve complex legal and factual questions and may be uncertain, and the
laws governing the scope of patent coverage and the periods of enforceability of patent protection are subject to
change. In addition, patent applications in the United States are maintained in secrecy until patents issue, and
publication of discoveries in the scientific or patent literature tends to lag behind actual discoveries by several
months. Therefore, no assurance can be given that patents will issue from any patent applications that we own or
license, or if patents do issue, that the claims allowed will be sufficiently broad to protect our technology. In addition,
no assurance can be given that any issued patents that we own or license will not be challenged, invalidated or
circumvented, or that the rights granted thereunder will provide us competitive advantages. Further, as issued patents
expire, we may lose some competitive advantage as others develop competing products and as a result, we may
lose revenue.

Certain of our products incorporate patents and technologies that are licensed from third parties and for certain
products, these in-licensed patents together with other patents provide us with a competitive advantage. These
licenses impose various commercialization, sublicensing and other obligations on us. Our failure to comply with
these requirements could result in the conversion of the applicable license from being exclusive to non-exclusive or, in
some cases, termination of the license, and as a result, we may lose some competitive advantage and experience a
loss of revenue.

70
We also rely on trade secrets and proprietary know-how, which we seek to protect through confidentiality
agreements with our employees and consultants. There can be no assurance that any confidentiality agreements that

we have with our employees, consultants, outside scientific collaborators and sponsored researchers and other

advisors will provide meaningful protection for our trade secrets or adequate remedies in the event of unauthorized

use or disclosure of such information. There also can be no assurance that our trade secrets will not otherwise

become known or be independently developed by competitors.

We currently engage in, and may continue to engage in, collaborations with academic researchers and institutions.

There can be no assurance that under the terms of such collaborations, third parties will not acquire rights in certain

inventions developed during the course of these collaborations.

The marketing and sale of our products and services for certain applications entail a potential risk of product liability.

Although we are not currently subject to any material product liability claims, product liability claims may be brought

against us in the future. Further, there can be no assurance that our products will not be included in unethical, illegal

or inappropriate research or applications, which may in turn put us at risk of litigation. We carry product liability

insurance coverage, which is limited in scope and amount. There can be no assurance that we will be able to

maintain this insurance at a reasonable cost and on reasonable terms, or that this insurance will be adequate to

protect us against any or all potential claims or losses.

We are subject to various laws and regulations generally applicable to businesses in the different jurisdictions in

which we operate, including laws and regulations applicable to the handling and disposal of hazardous substances.

The risk of accidental contamination or injury from these materials cannot be completely eliminated. In the event of

such an accident, we could be held liable for any damages that result, and any such liability could have a material

adverse impact on us.

Our operating results may vary significantly from quarter to quarter, and also year to year, since they are dependent

upon a broad range of factors that include demand for our products, the level and timing of customer research

budgets and commercialization efforts, the timing of government funding budgets of our customers, the timing of our

research and development activities and related regulatory approvals, the impact of sales and marketing expenses,

restructuring activities, introduction of new products by us or our competitors, competitive market conditions,

exchange rate fluctuations and general economic conditions. Our expense levels are based in part on our

expectations as to future sales trends. As a result, sales and earnings may vary significantly from quarter to quarter

or from year to year, and actual sales and earnings results in any one period will not necessarily be indicative of

results to be anticipated in subsequent periods. Our results may also fail to meet or exceed the expectations of

securities analysts or investors, which could cause a decline in the market price of our Common Shares.

Doing business internationally creates certain risks.Unethical behavior and non-compliance with laws by our sales representatives, otheremployees, consultants, commercial partners or distributors or employees couldseriously harm our business.We depend on patents and proprietary rights that may fail to protect our business.Our business exposes us to potential product liability.Our operating results may vary significantly from period to period and this mayaffect the market price of our Common Shares.Our holding company structure makes us dependent on the operations of oursubsidiaries.M A N A G E M E N T   R E P O R T Opportunities and Risks

circumvented, or that the rights granted thereunder will provide us competitive advantages. Further, as issued patents
expire, we may lose some competitive advantage as others develop competing products and as a result, we may
lose revenue.

Certain of our products incorporate patents and technologies that are licensed from third parties and for certain
products, these in-licensed patents together with other patents provide us with a competitive advantage. These
licenses impose various commercialization, sublicensing and other obligations on us. Our failure to comply with
these requirements could result in the conversion of the applicable license from being exclusive to non-exclusive or, in
some cases, termination of the license, and as a result, we may lose some competitive advantage and experience a
loss of revenue.

We also rely on trade secrets and proprietary know-how, which we seek to protect through confidentiality
agreements with our employees and consultants. There can be no assurance that any confidentiality agreements that
we have with our employees, consultants, outside scientific collaborators and sponsored researchers and other
advisors will provide meaningful protection for our trade secrets or adequate remedies in the event of unauthorized
use or disclosure of such information. There also can be no assurance that our trade secrets will not otherwise
become known or be independently developed by competitors.

We currently engage in, and may continue to engage in, collaborations with academic researchers and institutions.
There can be no assurance that under the terms of such collaborations, third parties will not acquire rights in certain
inventions developed during the course of these collaborations.

The marketing and sale of our products and services for certain applications entail a potential risk of product liability.
Although we are not currently subject to any material product liability claims, product liability claims may be brought
against us in the future. Further, there can be no assurance that our products will not be included in unethical, illegal
or inappropriate research or applications, which may in turn put us at risk of litigation. We carry product liability
insurance coverage, which is limited in scope and amount. There can be no assurance that we will be able to
maintain this insurance at a reasonable cost and on reasonable terms, or that this insurance will be adequate to
protect us against any or all potential claims or losses.

We are subject to various laws and regulations generally applicable to businesses in the different jurisdictions in
which we operate, including laws and regulations applicable to the handling and disposal of hazardous substances.
The risk of accidental contamination or injury from these materials cannot be completely eliminated. In the event of
such an accident, we could be held liable for any damages that result, and any such liability could have a material
adverse impact on us.

Our operating results may vary significantly from quarter to quarter, and also year to year, since they are dependent
upon a broad range of factors that include demand for our products, the level and timing of customer research
budgets and commercialization efforts, the timing of government funding budgets of our customers, the timing of our
research and development activities and related regulatory approvals, the impact of sales and marketing expenses,
restructuring activities, introduction of new products by us or our competitors, competitive market conditions,
exchange rate fluctuations and general economic conditions. Our expense levels are based in part on our
expectations as to future sales trends. As a result, sales and earnings may vary significantly from quarter to quarter
or from year to year, and actual sales and earnings results in any one period will not necessarily be indicative of
results to be anticipated in subsequent periods. Our results may also fail to meet or exceed the expectations of
securities analysts or investors, which could cause a decline in the market price of our Common Shares.

71

Our business exposes us to potential product liability.Our operating results may vary significantly from period to period and this mayaffect the market price of our Common Shares.Our holding company structure makes us dependent on the operations of oursubsidiaries.circumvented, or that the rights granted thereunder will provide us competitive advantages. Further, as issued patents

expire, we may lose some competitive advantage as others develop competing products and as a result, we may

lose revenue.

loss of revenue.

Certain of our products incorporate patents and technologies that are licensed from third parties and for certain

products, these in-licensed patents together with other patents provide us with a competitive advantage. These

licenses impose various commercialization, sublicensing and other obligations on us. Our failure to comply with

these requirements could result in the conversion of the applicable license from being exclusive to non-exclusive or, in

some cases, termination of the license, and as a result, we may lose some competitive advantage and experience a

We also rely on trade secrets and proprietary know-how, which we seek to protect through confidentiality

agreements with our employees and consultants. There can be no assurance that any confidentiality agreements that

we have with our employees, consultants, outside scientific collaborators and sponsored researchers and other

advisors will provide meaningful protection for our trade secrets or adequate remedies in the event of unauthorized

use or disclosure of such information. There also can be no assurance that our trade secrets will not otherwise

become known or be independently developed by competitors.

We currently engage in, and may continue to engage in, collaborations with academic researchers and institutions.

There can be no assurance that under the terms of such collaborations, third parties will not acquire rights in certain

inventions developed during the course of these collaborations.

The marketing and sale of our products and services for certain applications entail a potential risk of product liability.

Although we are not currently subject to any material product liability claims, product liability claims may be brought

against us in the future. Further, there can be no assurance that our products will not be included in unethical, illegal

or inappropriate research or applications, which may in turn put us at risk of litigation. We carry product liability

insurance coverage, which is limited in scope and amount. There can be no assurance that we will be able to

maintain this insurance at a reasonable cost and on reasonable terms, or that this insurance will be adequate to

protect us against any or all potential claims or losses.

We are subject to various laws and regulations generally applicable to businesses in the different jurisdictions in

which we operate, including laws and regulations applicable to the handling and disposal of hazardous substances.

The risk of accidental contamination or injury from these materials cannot be completely eliminated. In the event of

such an accident, we could be held liable for any damages that result, and any such liability could have a material

adverse impact on us.

Our operating results may vary significantly from quarter to quarter, and also year to year, since they are dependent

upon a broad range of factors that include demand for our products, the level and timing of customer research

budgets and commercialization efforts, the timing of government funding budgets of our customers, the timing of our
research and development activities and related regulatory approvals, the impact of sales and marketing expenses,
restructuring activities, introduction of new products by us or our competitors, competitive market conditions,
exchange rate fluctuations and general economic conditions. Our expense levels are based in part on our
expectations as to future sales trends. As a result, sales and earnings may vary significantly from quarter to quarter
or from year to year, and actual sales and earnings results in any one period will not necessarily be indicative of
results to be anticipated in subsequent periods. Our results may also fail to meet or exceed the expectations of
securities analysts or investors, which could cause a decline in the market price of our Common Shares.

QIAGEN N.V. is incorporated under Dutch law as a public limited liability company (naamloze vennootschap), and
is organized as a holding company. Currently, the material assets are the outstanding shares of the QIAGEN
subsidiaries, intercompany receivables and other financial assets such as cash, short-term investments and derivative
instruments. As a result, QIAGEN N.V. is dependent upon payments, dividends and distributions from the
subsidiaries for funds to pay operating and other expenses as well as to pay future cash dividends or distributions, if
any, to holders of our Common Shares. Dividends or distributions by subsidiaries in a currency other than the U.S.
dollar may result in a loss upon a subsequent conversion into U.S. dollars.

The market price of our Common Shares since our initial public offering in September 1996 has increased
significantly and been highly volatile. Beginning January 10, 2018, our shares are listed on the New York Stock
Exchange (NYSE). Before that, our shares were listed on the NASDAQ through January 9, 2018. In the last two
years, the price of our Common Shares has ranged from a high of $43.16 to a low of $25.04. On the Frankfurt
Stock Exchange our Common Shares have ranged from a high of €39.19 to a low of €22.54 during the last two
years. In addition to overall stock market fluctuations, factors that may have a significant impact on the price of our
Common Shares include:

›

announcements of technological innovations or the introduction of new products by us or our competitors;

›

developments in our relationships with collaborative partners;

›

quarterly variations in our operating results or those of our peer companies;

›

changes in government regulations, tax laws or patent laws;

›

developments in patent or other intellectual property rights;

›

developments in government spending budgets for life sciences-related research;

›

general market conditions relating to the diagnostics, applied testing, pharmaceutical and biotechnology
industries; and

›

impact from foreign exchange rates.

The stock market has from time to time experienced extreme price and trading volume fluctuations that have
particularly affected the market for technology-based companies. These fluctuations have not necessarily been related
to the operating performance of these companies. These broad market fluctuations may adversely affect the market
price of our Common Shares.

QIAGEN has not paid an annual dividend since its inception, nor intends to implement one at this time. At the same
time, in January 2017 we completed a synthetic share repurchase that combined a direct capital repayment with a
reverse stock split. Although we do not anticipate paying any cash dividends on a regular basis, the distribution of
any cash dividends through another synthetic share repurchase in a currency other than the U.S. dollar will be
subject to the risk of foreign currency transaction losses. Investors should not invest in our Common Shares if they are
seeking dividend income; the only return that may be realized through investing in our Common Shares would be
through an appreciation in the share price.

QIAGEN has conducted share repurchase programs in the past through open-market transactions. Additionally, in
72
January 2017, we completed a synthetic share repurchase that combined a direct capital repayment with a reverse
stock split. The transaction was announced in August 2016 and involved an approach used by various large,

multinational Dutch companies to provide returns to all shareholders in a faster and more efficient manner than

traditional open-market purchases. $243.9 million was returned to shareholders through the transaction, which

reduced the total number of issued common shares by approximately 3.7% or 8.9 million shares as of January 31,

2017.

Our business exposes us to potential product liability.Our operating results may vary significantly from period to period and this mayaffect the market price of our Common Shares.Our holding company structure makes us dependent on the operations of oursubsidiaries.Our Common Shares may have a volatile public trading price.Holders of our Common Shares should not expect to receive dividend income.Holders of our Common Shares may not benefit from continued stock repurchaseprograms.QIAGEN N.V. is incorporated under Dutch law as a public limited liability company (naamloze vennootschap), and

is organized as a holding company. Currently, the material assets are the outstanding shares of the QIAGEN

subsidiaries, intercompany receivables and other financial assets such as cash, short-term investments and derivative

instruments. As a result, QIAGEN N.V. is dependent upon payments, dividends and distributions from the

subsidiaries for funds to pay operating and other expenses as well as to pay future cash dividends or distributions, if

any, to holders of our Common Shares. Dividends or distributions by subsidiaries in a currency other than the U.S.

dollar may result in a loss upon a subsequent conversion into U.S. dollars.

The market price of our Common Shares since our initial public offering in September 1996 has increased

significantly and been highly volatile. Beginning January 10, 2018, our shares are listed on the New York Stock

Exchange (NYSE). Before that, our shares were listed on the NASDAQ through January 9, 2018. In the last two

years, the price of our Common Shares has ranged from a high of $43.16 to a low of $25.04. On the Frankfurt

Stock Exchange our Common Shares have ranged from a high of €39.19 to a low of €22.54 during the last two

years. In addition to overall stock market fluctuations, factors that may have a significant impact on the price of our

Common Shares include:

›

announcements of technological innovations or the introduction of new products by us or our competitors;

›

developments in our relationships with collaborative partners;

›

quarterly variations in our operating results or those of our peer companies;

›

changes in government regulations, tax laws or patent laws;

›

developments in patent or other intellectual property rights;

›

developments in government spending budgets for life sciences-related research;

›

general market conditions relating to the diagnostics, applied testing, pharmaceutical and biotechnology

industries; and

›

impact from foreign exchange rates.

The stock market has from time to time experienced extreme price and trading volume fluctuations that have

particularly affected the market for technology-based companies. These fluctuations have not necessarily been related

to the operating performance of these companies. These broad market fluctuations may adversely affect the market

price of our Common Shares.

QIAGEN has not paid an annual dividend since its inception, nor intends to implement one at this time. At the same
M A N A G E M E N T   R E P O R T Opportunities and Risks
time, in January 2017 we completed a synthetic share repurchase that combined a direct capital repayment with a
reverse stock split. Although we do not anticipate paying any cash dividends on a regular basis, the distribution of
any cash dividends through another synthetic share repurchase in a currency other than the U.S. dollar will be
subject to the risk of foreign currency transaction losses. Investors should not invest in our Common Shares if they are
seeking dividend income; the only return that may be realized through investing in our Common Shares would be
through an appreciation in the share price.

QIAGEN has conducted share repurchase programs in the past through open-market transactions. Additionally, in
January 2017, we completed a synthetic share repurchase that combined a direct capital repayment with a reverse
stock split. The transaction was announced in August 2016 and involved an approach used by various large,
multinational Dutch companies to provide returns to all shareholders in a faster and more efficient manner than
traditional open-market purchases. $243.9 million was returned to shareholders through the transaction, which
reduced the total number of issued common shares by approximately 3.7% or 8.9 million shares as of January 31,
2017.

The purpose of our share repurchases has been to hold the shares in treasury in order to satisfy obligations from
exchangeable debt instruments, warrants and/or employee share-based remuneration plans and thus to reduce
dilution to existing holders of our Common Shares. In 2019, we began net share withholding on the vesting of stock-
based awards and as a result, fewer shares are issued than the number of awards outstanding. We may decide not
to continue such programs in the future, our covenants with lenders may limit our ability to use available cash to do
so, or the market price of our Common Shares may make such repurchases less desirable. In any of these cases,
holders of our Common Shares may suffer dilution from conversion of our indebtedness or issuance of shares
pursuant to employee remuneration plans that would otherwise be at least partially offset by repurchased shares.

Any future sale or issuance of a substantial number of our Common Shares in the public market, or any perception
that a sale may occur, could adversely affect the market price of our Common Shares. Under Dutch law, a company
can issue shares up to its authorized share capital provided for in its Articles of Association. Pursuant to our Articles
of Association, our authorized share capital amounts to EUR 9.0 million, which is divided into 410.0 million common
shares, 40.0 million financing preference shares and 450.0 million preference shares, with all shares having a EUR
0.01 par value. As of December 31, 2019, a total of approximately 227.8 million Common Shares were
outstanding along with approximately 6.0 million additional shares reserved for issuance upon exercise or release of
outstanding stock options and awards, of which 0.8 million were vested. A total of approximately 15.7 million
Common Shares are reserved and available for issuances under our stock plans as of December 31, 2019,
including the shares subject to outstanding stock options and awards. The majority of our outstanding Common
Shares may be sold without restriction, except shares held by our affiliates, which are subject to certain limitations on
resale. Additionally, the Warrants issued in connection with the Cash Convertible Notes Call Spread Overlays cover
an aggregate of 31.1 million shares of our common stock (subject to customary adjustments under certain
circumstances).

We may be classified as a “passive foreign investment company,” or a PFIC, for U.S. federal income tax purposes if
certain tests are met. Our treatment as a PFIC could result in a reduction in the after-tax return to holders of Common
Shares and would likely cause a reduction in the value of these shares. If we were determined to be a PFIC for U.S.
federal income tax purposes, highly complex rules would apply to our U.S. shareholders. We would be considered a
PFIC with respect to a U.S. shareholder if for any taxable year in which the U.S. shareholder held the Common
Shares, either (i) 75% or more of our gross income for the taxable year is passive income; or (ii) the average value
of our assets (during the taxable year) which produce or are held for the production of passive income is at least
50% of the average value of all assets for such year. Based on our income, assets and activities, we do not believe
that we were a PFIC for U.S. federal income tax purposes for our taxable year ended December 31, 2019, and do
not expect to be a PFIC for the current taxable year or any future taxable year. No assurances can be made,
however, that the Internal Revenue Service will not challenge this position or that we will not subsequently become a
PFIC.

73

Our Articles of Association (Articles) provide that our shareholders may only suspend or dismiss our Managing

Directors and Supervisory Directors against their wishes with a vote of two-thirds of the votes cast if such votes

represent more than 50% of our issued share capital. If the proposal was made by the joint meeting of the

Supervisory Board and the Managing Board, a simple majority is sufficient. The Articles also provide that if the

members of our Supervisory Board and our Managing Board have been nominated by the joint meeting of the

Supervisory Board and Managing Board, shareholders may only overrule this nomination with a vote of two-thirds of

the votes cast if such votes represent more than 50% of our issued share capital.

Future sales and issuances of our Common Shares could adversely affect our stockprice.Shareholders who are United States residents could be subject to unfavorable taxtreatment.Provisions of our Articles of Association and Dutch law and an option we havegranted may make it difficult to replace or remove management and may inhibit ordelay a takeover.Our Common Shares may have a volatile public trading price.Holders of our Common Shares should not expect to receive dividend income.Holders of our Common Shares may not benefit from continued stock repurchaseprograms.The purpose of our share repurchases has been to hold the shares in treasury in order to satisfy obligations from

exchangeable debt instruments, warrants and/or employee share-based remuneration plans and thus to reduce

dilution to existing holders of our Common Shares. In 2019, we began net share withholding on the vesting of stock-

based awards and as a result, fewer shares are issued than the number of awards outstanding. We may decide not

to continue such programs in the future, our covenants with lenders may limit our ability to use available cash to do

so, or the market price of our Common Shares may make such repurchases less desirable. In any of these cases,

holders of our Common Shares may suffer dilution from conversion of our indebtedness or issuance of shares

pursuant to employee remuneration plans that would otherwise be at least partially offset by repurchased shares.

Any future sale or issuance of a substantial number of our Common Shares in the public market, or any perception

that a sale may occur, could adversely affect the market price of our Common Shares. Under Dutch law, a company

can issue shares up to its authorized share capital provided for in its Articles of Association. Pursuant to our Articles

of Association, our authorized share capital amounts to EUR 9.0 million, which is divided into 410.0 million common

shares, 40.0 million financing preference shares and 450.0 million preference shares, with all shares having a EUR

0.01 par value. As of December 31, 2019, a total of approximately 227.8 million Common Shares were

outstanding along with approximately 6.0 million additional shares reserved for issuance upon exercise or release of

outstanding stock options and awards, of which 0.8 million were vested. A total of approximately 15.7 million

Common Shares are reserved and available for issuances under our stock plans as of December 31, 2019,

including the shares subject to outstanding stock options and awards. The majority of our outstanding Common

Shares may be sold without restriction, except shares held by our affiliates, which are subject to certain limitations on

resale. Additionally, the Warrants issued in connection with the Cash Convertible Notes Call Spread Overlays cover

an aggregate of 31.1 million shares of our common stock (subject to customary adjustments under certain

circumstances).

We may be classified as a “passive foreign investment company,” or a PFIC, for U.S. federal income tax purposes if
certain tests are met. Our treatment as a PFIC could result in a reduction in the after-tax return to holders of Common
Shares and would likely cause a reduction in the value of these shares. If we were determined to be a PFIC for U.S.
federal income tax purposes, highly complex rules would apply to our U.S. shareholders. We would be considered a
PFIC with respect to a U.S. shareholder if for any taxable year in which the U.S. shareholder held the Common
Shares, either (i) 75% or more of our gross income for the taxable year is passive income; or (ii) the average value
of our assets (during the taxable year) which produce or are held for the production of passive income is at least
50% of the average value of all assets for such year. Based on our income, assets and activities, we do not believe
that we were a PFIC for U.S. federal income tax purposes for our taxable year ended December 31, 2019, and do
not expect to be a PFIC for the current taxable year or any future taxable year. No assurances can be made,
however, that the Internal Revenue Service will not challenge this position or that we will not subsequently become a
PFIC.

Our Articles of Association (Articles) provide that our shareholders may only suspend or dismiss our Managing
Directors and Supervisory Directors against their wishes with a vote of two-thirds of the votes cast if such votes
represent more than 50% of our issued share capital. If the proposal was made by the joint meeting of the
Supervisory Board and the Managing Board, a simple majority is sufficient. The Articles also provide that if the
members of our Supervisory Board and our Managing Board have been nominated by the joint meeting of the
Supervisory Board and Managing Board, shareholders may only overrule this nomination with a vote of two-thirds of
the votes cast if such votes represent more than 50% of our issued share capital.

Certain other provisions of our Articles allow us, under certain circumstances, to prevent a third party from obtaining
a majority of the voting control of our Common Shares through the issuance of Preference Shares. Pursuant to our
Articles and the resolution adopted by our General Meeting of Shareholders, our Supervisory Board is entitled to
issue Preference Shares in case of an intended takeover of our company by (i) any person who alone or with one or
more other persons, directly or indirectly, have acquired or given notice of an intent to acquire (beneficial) ownership
of an equity stake which in aggregate equals 20% or more of our share capital then outstanding or (ii) an “adverse
person” as determined by the Supervisory Board. If the Supervisory Board opposes an intended takeover and
authorizes the issuance of Preference Shares, the bidder may withdraw its bid or enter into negotiations with the
Managing Board and/or Supervisory Board and agree on a higher bid price for our Shares.

In 2004, we granted an option to the Stichting Preferente Aandelen QIAGEN, or the Foundation (Stichting), subject
to the conditions described in the paragraph above, which allows the Foundation to acquire Preference Shares from
us. The option enables the Foundation to acquire such number of Preference Shares as equals the number of our
outstanding Common Shares at the time of the relevant exercise of the option, less one Preference Share. When
exercising the option and exercising its voting rights on these Preference Shares, the Foundation must act in our
interest and the interests of our stakeholders. The purpose of the Foundation option is to prevent or delay a change of
control that would not be in the best interests of our stakeholders. An important restriction on the Foundation’s ability
to prevent or delay a change of control is that a public offer must be announced by a third party before it can issue
(preference or other) protective shares that would enable the Foundation to exercise rights to 30% or more of the
voting rights without an obligation to make a mandatory offer for all shares held by the remaining shareholders. In
addition, the holding period for these shares by the Foundation is restricted to two years, and this protective stake
must fall below the 30% voting rights threshold before the two-year period ends. Notwithstanding the foregoing, in
connection with the Business Combination Agreement that we entered into with Thermo Fisher Scientific Inc. (Thermo)
on March 3, 2020 (BCA), we and the Foundation have agreed that (i) the Foundation shall not exercise the option in
a way that would reasonably be expected to adversely affect the timely consummation of the acquisition
contemplated by the BCA, unless and until the BCA has been terminated, (ii) if the Foundation exercises the option
during the term of the BCA, the Foundation shall not exercise its voting rights as a shareholder in a manner that
would reasonably be expected to adversely affect the timely consummation of the acquisition, unless and until the
BCA has been terminated, (iii) the option shall be terminated subject only to the closing of the public tender offer (the
“Closing”) and (iv) to the extent any Preference Shares would be held by the Foundation as of the Closing, the
Foundation shall transfer such shares to the wholly owned acquisition subsidiary of Thermo (Offeror) under the
obligation for the Offeror to pay a cash consideration equal to the aggregate capital paid up on such Preference
Shares plus any accrued dividends and to indemnify the Foundation for any claim by us.

74

Future sales and issuances of our Common Shares could adversely affect our stockprice.Shareholders who are United States residents could be subject to unfavorable taxtreatment.Provisions of our Articles of Association and Dutch law and an option we havegranted may make it difficult to replace or remove management and may inhibit ordelay a takeover.M A N A G E M E N T   R E P O R T Opportunities and Risks

75

Management Report
Management Report

Performance Review
Business and Operating Environment

Our future operating results may be affected by various risk factors, many of which 
Our future operating results may be affected by various risk factors, many of which are beyond our control. Certain
are beyond our control. Certain statements included in this Annual Report and the 
QIAGEN is a global leader in Sample to Insight solutions that transform biological samples into valuable molecular
statements included in this Annual Report and the documents incorporated herein by reference may be forward-
insights. Our mission is to enable customers across the continuum of molecular testing to unlock valuable insights
looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section
documents incorporated herein by reference may be forward-looking statements 
faster, better and more efficiently - from the raw biological sample to the final interpreted result.
21E of the U.S. Securities Exchange Act of 1934, as amended, including statements regarding potential future net
within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, 
sales, gross profit, net income and liquidity. These statements can be identified by the use of forward-looking
and Section 21E of the U.S. Securities Exchange Act of 1934, as amended, including 
terminology such as “believe,” “hope,” “plan,” “intend,” “seek,” “may,” “will,” “could,” “should,” “would,”
We serve more than 500,000 customers in two broad customer groups: Molecular Diagnostics (human healthcare)
Management Report
statements regarding potential future net sales, gross profit, net income and liquidity. 
“expect,” “anticipate,” “estimate,” “continue” or other similar words. Reference is made in particular to the
and Life Sciences (academia, pharma R&D and industrial applications, primarily forensics). Proven QIAGEN
description of our plans and objectives for future operations, assumptions underlying such plans and objectives, and
solutions and content are providing answers in hospitals and laboratories worldwide, helping make sense of the
These statements can be identified by the use of forward-looking terminology such 
other forward-looking statements. Such statements are based on management’s current expectations and are subject
increasing volumes and complexity of biological information, in keeping with our vision of making improvements in
as “believe,” “hope,” “plan,” “intend,” “seek,” “may,” “will,” “could,” “should,” 
to a number of factors and uncertainties that could cause actual results to differ materially from those described in the
life possible.
Performance Review
“would,” “expect,” “anticipate,” “estimate,” “continue” or other similar words. 
forward-looking statements. We caution investors that there can be no assurance that actual results or business
conditions will not differ materially from those projected or suggested in such forward-looking statements as a result
Reference is made in particular to the description of our plans and objectives for 
QIAGEN began operations in 1986 as a pioneer in the emerging biotechnology sector, introducing a novel method
of various factors. Factors which could cause such results to differ materially from those described in the forward-
that standardized and accelerated extraction and purification of nucleic acids from biological samples. As molecular
future operations, assumptions underlying such plans and objectives, and other  
Our future operating results may be affected by various risk factors, many of which are beyond our control. Certain
looking statements include those set forth in the risk factors below. As a result, our future success involves a high
biology and genomic knowledge have grown to influence many areas of life, QIAGEN has expanded to serve the
forward-looking statements. Such statements are based on management’s current 
statements included in this Annual Report and the documents incorporated herein by reference may be forward-
degree of risk. When considering forward-looking statements, you should keep in mind that the risk factors could
full spectrum of market needs. We believe our sample technologies are unmatched in quality for isolating and
looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section
cause our actual results to differ significantly from those contained in any forward-looking statement.
expectations and are subject to a number of factors and uncertainties that could 
preparing DNA (deoxyribonucleic acid), RNA (ribonucleic acid) and proteins from blood or other liquids, tissue,
21E of the U.S. Securities Exchange Act of 1934, as amended, including statements regarding potential future net
plants or other materials. Our assay technologies amplify, enrich and make these biomolecules accessible for
cause actual results to differ materially from those described in the forward-looking 
sales, gross profit, net income and liquidity. These statements can be identified by the use of forward-looking
analysis, such as identifying the genetic information of a pathogen or a gene mutation in a tumor. QIAGEN’s
Results of Operations
statements. We caution investors that there can be no assurance that actual results 
terminology such as “believe,” “hope,” “plan,” “intend,” “seek,” “may,” “will,” “could,” “should,” “would,”
industry-leading Digital Insights solutions allow users to analyze and interpret data with bioinformatics software and
“expect,” “anticipate,” “estimate,” “continue” or other similar words. Reference is made in particular to the
or business conditions will not differ materially from those projected or suggested in 
knowledge bases to provide relevant, actionable insights. Our automation systems tie these technologies together in
description of our plans and objectives for future operations, assumptions underlying such plans and objectives, and
seamless and cost-effective molecular testing workflows - from Sample to Insight.
such forward-looking statements as a result of various factors. Factors which could 
other forward-looking statements. Such statements are based on management’s current expectations and are subject
We are a leading global provider of Sample to Insight solutions to transform biological materials into valuable
cause such results to differ materially from those described in the forward-looking 
to a number of factors and uncertainties that could cause actual results to differ materially from those described in the
molecular insights. QIAGEN sample technologies isolate and process DNA, RNA and proteins from any biological
Net sales of $1.53 billion in 2019 consisted of consumable kits and other revenues (89% of sales) and automation
forward-looking statements. We caution investors that there can be no assurance that actual results or business
statements include those set forth in the risk factors below. As a result, our future 
sample, such as blood or tissue. Assay technologies make these biomolecules visible and ready for analysis, such as
systems and instruments (11% of sales). Approximately 48% of net sales in 2019 were in Molecular Diagnostics, and
conditions will not differ materially from those projected or suggested in such forward-looking statements as a result
identifying the DNA of a virus or a mutation of a gene. Digital insights integrate software and cloud-based resources
success involves a high degree of risk. When considering forward-looking state-
52% in Life Sciences customer classes in the Academia / Applied Testing and Pharma markets.
of various factors. Factors which could cause such results to differ materially from those described in the forward-
to interpret increasing volumes of biological data and report relevant, actionable insights. Our automation solutions
ments, you should keep in mind that the risk factors could cause our actual results  
looking statements include those set forth in the risk factors below. As a result, our future success involves a high
tie these together in seamless and cost-effective molecular testing workflows.
degree of risk. When considering forward-looking statements, you should keep in mind that the risk factors could
QIAGEN has grown by developing new instruments, consumables and digital solutions to meet diverse and growing
to differ significantly from those contained in any forward-looking statement.
cause our actual results to differ significantly from those contained in any forward-looking statement.
needs in the market, partnering with researchers and Pharma companies, and acquiring companies or technologies
We sell our products - consumables, automated instrumentation systems using those technologies, and digital insights
to complement our portfolio. We believe the addressable global market for QIAGEN's portfolio of molecular testing
to analyze and interpret the data - to two major customer classes:
products for customers across the continuum of life science research and molecular diagnostics totals more than $10
Results of Operations
billion.

›

 - healthcare providers engaged in many aspects of patient care requiring accurate

›

diagnosis and insights to guide treatment decisions in oncology, infectious diseases and immune monitoring.
We have funded our growth through internally generated funds, debt offerings, and private and public sales of
Includes Precision Medicine and companion diagnostics.
We are a leading global provider of Sample to Insight solutions to transform biological materials into valuable
equity securities. QIAGEN’s global shares are listed on the New York Stock Exchange under the ticker symbol
molecular insights. QIAGEN sample technologies isolate and process DNA, RNA and proteins from any biological
QGEN and on the Frankfurt Prime Standard as QIA.
 - customers including government, biotechnology companies and researchers who utilize molecular
sample, such as blood or tissue. Assay technologies make these biomolecules visible and ready for analysis, such as
testing and technologies who are generally served by public funding including areas such as medicine and clinical
identifying the DNA of a virus or a mutation of a gene. Digital insights integrate software and cloud-based resources
development efforts, forensics and exploring the secrets of life. Includes Pharma, Academia and Applied Testing
The company is registered under its commercial and legal name QIAGEN N.V. with the trade register (kamer van
to interpret increasing volumes of biological data and report relevant, actionable insights. Our automation solutions
customers.
koophandel) of the Dutch region Limburg Noord under file number 12036979. QIAGEN N.V. is a public limited
tie these together in seamless and cost-effective molecular testing workflows.
liability company (naamloze vennootschap) under Dutch law as a holding company. Our principal executive office is
located at Hulsterweg 82, 5912 PL Venlo, The Netherlands, and our telephone number is +31-77-355-6600.
We market products in more than 130 countries, mainly through subsidiaries in markets we believe have the greatest
We sell our products - consumables, automated instrumentation systems using those technologies, and digital insights
sales potential in Europe, Asia, the Americas and Australia. We also work with specialized independent distributors
to analyze and interpret the data - to two major customer classes:
and importers. As of December 31, 2019, we employed approximately 5,100 people in more than 35 locations
As a holding company, QIAGEN conducts business through subsidiaries located throughout the world. Further
worldwide.
information about QIAGEN can be found at www.QIAGEN.com. By referring to our website, we do not incorporate
the website or any portion of the website by reference into this Annual Report.

 - healthcare providers engaged in many aspects of patient care requiring accurate

›

diagnosis and insights to guide treatment decisions in oncology, infectious diseases and immune monitoring.
Includes Precision Medicine and companion diagnostics.

›

76

 - customers including government, biotechnology companies and researchers who utilize molecular

testing and technologies who are generally served by public funding including areas such as medicine and clinical
development efforts, forensics and exploring the secrets of life. Includes Pharma, Academia and Applied Testing
customers.

We market products in more than 130 countries, mainly through subsidiaries in markets we believe have the greatest

sales potential in Europe, Asia, the Americas and Australia. We also work with specialized independent distributors

and importers. As of December 31, 2019, we employed approximately 5,100 people in more than 35 locations

worldwide.

OverviewRecent AcquisitionsMolecular DiagnosticsLife SciencesOverviewRecent AcquisitionsMolecular DiagnosticsLife SciencesManagement Report

Management Report

Performance Review

Performance Review

Our future operating results may be affected by various risk factors, many of which are beyond our control. Certain

statements included in this Annual Report and the documents incorporated herein by reference may be forward-

looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section

Our future operating results may be affected by various risk factors, many of which are beyond our control. Certain

21E of the U.S. Securities Exchange Act of 1934, as amended, including statements regarding potential future net

statements included in this Annual Report and the documents incorporated herein by reference may be forward-

looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section

sales, gross profit, net income and liquidity. These statements can be identified by the use of forward-looking

21E of the U.S. Securities Exchange Act of 1934, as amended, including statements regarding potential future net

terminology such as “believe,” “hope,” “plan,” “intend,” “seek,” “may,” “will,” “could,” “should,” “would,”

sales, gross profit, net income and liquidity. These statements can be identified by the use of forward-looking

“expect,” “anticipate,” “estimate,” “continue” or other similar words. Reference is made in particular to the

terminology such as “believe,” “hope,” “plan,” “intend,” “seek,” “may,” “will,” “could,” “should,” “would,”

description of our plans and objectives for future operations, assumptions underlying such plans and objectives, and

“expect,” “anticipate,” “estimate,” “continue” or other similar words. Reference is made in particular to the

other forward-looking statements. Such statements are based on management’s current expectations and are subject

description of our plans and objectives for future operations, assumptions underlying such plans and objectives, and

to a number of factors and uncertainties that could cause actual results to differ materially from those described in the

other forward-looking statements. Such statements are based on management’s current expectations and are subject

forward-looking statements. We caution investors that there can be no assurance that actual results or business

to a number of factors and uncertainties that could cause actual results to differ materially from those described in the

conditions will not differ materially from those projected or suggested in such forward-looking statements as a result

forward-looking statements. We caution investors that there can be no assurance that actual results or business

of various factors. Factors which could cause such results to differ materially from those described in the forward-

conditions will not differ materially from those projected or suggested in such forward-looking statements as a result

looking statements include those set forth in the risk factors below. As a result, our future success involves a high

of various factors. Factors which could cause such results to differ materially from those described in the forward-

degree of risk. When considering forward-looking statements, you should keep in mind that the risk factors could

looking statements include those set forth in the risk factors below. As a result, our future success involves a high

cause our actual results to differ significantly from those contained in any forward-looking statement.

degree of risk. When considering forward-looking statements, you should keep in mind that the risk factors could

cause our actual results to differ significantly from those contained in any forward-looking statement.

Results of Operations

Results of Operations

We are a leading global provider of Sample to Insight solutions to transform biological materials into valuable

We are a leading global provider of Sample to Insight solutions to transform biological materials into valuable

molecular insights. QIAGEN sample technologies isolate and process DNA, RNA and proteins from any biological

molecular insights. QIAGEN sample technologies isolate and process DNA, RNA and proteins from any biological

sample, such as blood or tissue. Assay technologies make these biomolecules visible and ready for analysis, such as

sample, such as blood or tissue. Assay technologies make these biomolecules visible and ready for analysis, such as

identifying the DNA of a virus or a mutation of a gene. Digital insights integrate software and cloud-based resources

identifying the DNA of a virus or a mutation of a gene. Digital insights integrate software and cloud-based resources
to interpret increasing volumes of biological data and report relevant, actionable insights. Our automation solutions
to interpret increasing volumes of biological data and report relevant, actionable insights. Our automation solutions
tie these together in seamless and cost-effective molecular testing workflows.
tie these together in seamless and cost-effective molecular testing workflows.

M A N A G E M E N T   R E P O R T

Performance Review

We sell our products - consumables, automated instrumentation systems using those technologies, and digital insights
We sell our products - consumables, automated instrumentation systems using those technologies, and digital insights
to analyze and interpret the data - to two major customer classes:
to analyze and interpret the data - to two major customer classes:

›

›

›

›

 - healthcare providers engaged in many aspects of patient care requiring accurate
 - healthcare providers engaged in many aspects of patient care requiring accurate

diagnosis and insights to guide treatment decisions in oncology, infectious diseases and immune monitoring.
diagnosis and insights to guide treatment decisions in oncology, infectious diseases and immune monitoring.
Includes Precision Medicine and companion diagnostics.
Includes Precision Medicine and companion diagnostics.

 - customers including government, biotechnology companies and researchers who utilize molecular
 - customers including government, biotechnology companies and researchers who utilize molecular

testing and technologies who are generally served by public funding including areas such as medicine and clinical
testing and technologies who are generally served by public funding including areas such as medicine and clinical
development efforts, forensics and exploring the secrets of life. Includes Pharma, Academia and Applied Testing
development efforts, forensics and exploring the secrets of life. Includes Pharma, Academia and Applied Testing
customers.
customers.

We market products in more than 130 countries, mainly through subsidiaries in markets we believe have the greatest
We market products in more than 130 countries, mainly through subsidiaries in markets we believe have the greatest
sales potential in Europe, Asia, the Americas and Australia. We also work with specialized independent distributors
sales potential in Europe, Asia, the Americas and Australia. We also work with specialized independent distributors
and importers. As of December 31, 2019, we employed approximately 5,100 people in more than 35 locations
and importers. As of December 31, 2019, we employed approximately 5,100 people in more than 35 locations
worldwide.
worldwide.

We have made a number of strategic acquisitions and implemented other strategic transactions aiming to achieve
market-leading positions with innovative technologies in high-growth areas of molecular diagnostics and research.
These transactions have enhanced our product offerings and technology platforms, as well as our geographic
footprint. They include:

›

›

›

›

In January 2019, QIAGEN began developing next-generation systems for digital PCR and acquired the digital
PCR assets of Formulatrix, Inc., a developer of laboratory automation solutions. We expect to begin
commercializing fully integrated digital PCR solutions in 2020, combining QIAGEN technologies and automation
with the Formulatrix assets we acquired. Known as QIAcuity, the system will offer highly automated workflows,
quicker time-to-result, and higher multiplexing and throughput flexibility than current digital PCR platforms. Digital
PCR is one of the fastest-growing molecular testing applications in the life sciences industry. QIAGEN paid
Formulatrix $125 million in cash upon closing and agreed to future milestone payments of approximately $136
million in 2020.

Also in January 2019, QIAGEN acquired N-of-One, Inc., a pioneer in molecular oncology decision support
services, to strengthen our bioinformatics leadership in clinical NGS interpretation. The acquisition broadened the
QIAGEN Digital Insights offering of software, content and service-based solutions. N-of-One’s services and content
have been integrated into QIAGEN Clinical Insights (QCI), adding medical interpretation and real-world evidence
insights. The N-of-One somatic cancer database, drawing upon more than 125,000 anonymized patient samples,
has increased QIAGEN’s lead as the provider of the industry’s largest genomics knowledge base.

In September 2018, QIAGEN announced a strategic partnership with NeuMoDx Molecular, Inc. to commercialize
next-generation, fully integrated automation systems for PCR testing. The NeuMoDx 288 (high-throughput version)
and NeuMoDx 96 (mid-throughput) systems help clinical laboratories process increasing molecular test volumes
and deliver more rapid diagnostic insights. QIAGEN is initially distributing NeuMoDx systems and consumables in
Europe and other markets outside the United States. The companies entered a merger agreement whereby
QIAGEN will acquire remaining NeuMoDx shares that it does not currently own at a price of approximately $234
million (QIAGEN currently owns 19.9% of NeuMoDx), subject to the achievement of regulatory and operational
milestones, by mid-2020.

In April 2018, QIAGEN acquired STAT-Dx, a privately held company, and launched QIAstat-Dx, a next-
generation multiplex PCR system developed by STAT-Dx, in Europe. The novel QIAstat-Dx system enables fast, cost-
effective and flexible syndromic testing from Sample to Insight. The first two CE-IVD marked assays provide
differential diagnosis of serious respiratory and gastrointestinal infections. In May 2019, we received FDA
clearance and launched QIAstat-Dx in the United States with the respiratory panel. A broad menu of tests is under
development in infectious disease, oncology and other areas. QIAGEN acquired STAT-Dx for approximately $149
million in cash and additional future payments of up to about $44 million based on the achievement of regulatory
and commercial milestones.

Our financial results include the impacts of recent acquisitions from their effective dates.

In October 2019, QIAGEN announced a new orientation for its NGS-related activities that focuses development
activities on maximizing the new Illumina partnership for IVD solutions, as well as expanding QIAGEN’s offering of
universal NGS consumables solutions for use with any sequencer. QIAGEN intends to continue supporting and
servicing customers of the GeneReader NGS System, which is commercialized worldwide as a complete system for

77

the processing of smaller targeted gene panels. However, QIAGEN discontinued development for new NGS

instruments. Additionally, QIAGEN began implementing a set of initiatives to shift its Global Operations organization

to a regional manufacturing structure and to expand the scope of activities at QIAGEN Business Services (QBS)

centers in Wroclaw, Poland, and Manila, Philippines. QIAGEN currently anticipates further pre-tax charges of about

$15-23 million in 2020 for these measures.

We determined that we operate as one business segment in accordance with ASC Topic 280, Segment Reporting.

Our chief operating decision maker (CODM) makes decisions on business operations and resource allocation based

on evaluations of the QIAGEN Group as a whole. Considering acquisitions made during 2019 together with recent

changes in our management, we determined that we still operate as one business segment. We provide certain

OverviewRecent AcquisitionsMolecular DiagnosticsLife SciencesNGS portfolio orientation and measures to prioritize resource allocationOverviewRecent AcquisitionsMolecular DiagnosticsLife SciencesWe have made a number of strategic acquisitions and implemented other strategic transactions aiming to achieve

market-leading positions with innovative technologies in high-growth areas of molecular diagnostics and research.

These transactions have enhanced our product offerings and technology platforms, as well as our geographic

footprint. They include:

›

In January 2019, QIAGEN began developing next-generation systems for digital PCR and acquired the digital

PCR assets of Formulatrix, Inc., a developer of laboratory automation solutions. We expect to begin

commercializing fully integrated digital PCR solutions in 2020, combining QIAGEN technologies and automation

with the Formulatrix assets we acquired. Known as QIAcuity, the system will offer highly automated workflows,

quicker time-to-result, and higher multiplexing and throughput flexibility than current digital PCR platforms. Digital

PCR is one of the fastest-growing molecular testing applications in the life sciences industry. QIAGEN paid

Formulatrix $125 million in cash upon closing and agreed to future milestone payments of approximately $136

million in 2020.

›

Also in January 2019, QIAGEN acquired N-of-One, Inc., a pioneer in molecular oncology decision support

services, to strengthen our bioinformatics leadership in clinical NGS interpretation. The acquisition broadened the

QIAGEN Digital Insights offering of software, content and service-based solutions. N-of-One’s services and content

have been integrated into QIAGEN Clinical Insights (QCI), adding medical interpretation and real-world evidence

insights. The N-of-One somatic cancer database, drawing upon more than 125,000 anonymized patient samples,

has increased QIAGEN’s lead as the provider of the industry’s largest genomics knowledge base.

›

In September 2018, QIAGEN announced a strategic partnership with NeuMoDx Molecular, Inc. to commercialize

next-generation, fully integrated automation systems for PCR testing. The NeuMoDx 288 (high-throughput version)

and NeuMoDx 96 (mid-throughput) systems help clinical laboratories process increasing molecular test volumes

and deliver more rapid diagnostic insights. QIAGEN is initially distributing NeuMoDx systems and consumables in

Europe and other markets outside the United States. The companies entered a merger agreement whereby

QIAGEN will acquire remaining NeuMoDx shares that it does not currently own at a price of approximately $234

million (QIAGEN currently owns 19.9% of NeuMoDx), subject to the achievement of regulatory and operational

milestones, by mid-2020.

›

In April 2018, QIAGEN acquired STAT-Dx, a privately held company, and launched QIAstat-Dx, a next-

generation multiplex PCR system developed by STAT-Dx, in Europe. The novel QIAstat-Dx system enables fast, cost-

effective and flexible syndromic testing from Sample to Insight. The first two CE-IVD marked assays provide

differential diagnosis of serious respiratory and gastrointestinal infections. In May 2019, we received FDA

clearance and launched QIAstat-Dx in the United States with the respiratory panel. A broad menu of tests is under
development in infectious disease, oncology and other areas. QIAGEN acquired STAT-Dx for approximately $149
million in cash and additional future payments of up to about $44 million based on the achievement of regulatory
and commercial milestones.

Our financial results include the impacts of recent acquisitions from their effective dates.

In October 2019, QIAGEN announced a new orientation for its NGS-related activities that focuses development
activities on maximizing the new Illumina partnership for IVD solutions, as well as expanding QIAGEN’s offering of
universal NGS consumables solutions for use with any sequencer. QIAGEN intends to continue supporting and
servicing customers of the GeneReader NGS System, which is commercialized worldwide as a complete system for
the processing of smaller targeted gene panels. However, QIAGEN discontinued development for new NGS
instruments. Additionally, QIAGEN began implementing a set of initiatives to shift its Global Operations organization
to a regional manufacturing structure and to expand the scope of activities at QIAGEN Business Services (QBS)
centers in Wroclaw, Poland, and Manila, Philippines. QIAGEN currently anticipates further pre-tax charges of about
$15-23 million in 2020 for these measures.

We determined that we operate as one business segment in accordance with ASC Topic 280, Segment Reporting.
Our chief operating decision maker (CODM) makes decisions on business operations and resource allocation based
on evaluations of the QIAGEN Group as a whole. Considering acquisitions made during 2019 together with recent
changes in our management, we determined that we still operate as one business segment. We provide certain
revenue information by customer class to allow better insight into our operations. This information is estimated using
certain assumptions to allocate revenue among the customer classes.

Year Ended December 31, 2019, Compared to 2018

In 2019, net sales grew 2% to $1.53 billion compared to $1.50 billion in 2018 reflecting growth in consumables
and related revenues which more than offset lower instrument revenues. Consumable and related revenues includes
the contributions from our January 2019 acquisition of N-of-One, which provided net sales of approximately $5.0
million in 2019. We experienced increases across consumables and related revenues (+3% / 89% of sales) due to
strong sales of the QuantiFERON-TB test as well as gains within the Life Sciences customer classes. This more than
outweighed decreases across the instruments portfolio (-8% / 11% of sales) including lower sales of platforms for
assay technologies and the GeneReader NGS Systems despite higher placements of the QIAcube Connect,
QIASymphony and QIAstat-Dx systems. Net sales were negatively impacted by two percentage points from adverse
currency movements against the U.S. dollar.

 An overview of net sales by product category and customer class:

Consumables and related revenues

Instruments

Molecular Diagnostics(1)

Life Sciences

Academia / Applied Testing

Pharma

$ 1,354

$ 172

$ 737

$ 789

$ 487

$ 302

+3%

-8%

+1%

+2%

+2%

+4%

89%

11%

48%

52%

32%

20%

(1) Includes companion diagnostic co-development revenues ($42 million, -28%).

Molecular Diagnostics grew 1% and represented 48% of sales in 2019. Molecular Diagnostics sales were adversely
affected by three percentage points of adverse currency movements compared to 2018. Sales in 2019 included
78
gains in consumables, in particular for the QuantiFERON-TB test compared to 2018 that was partially offset by
significantly lower revenues from companion diagnostic co-development projects and instruments.

During 2019, Life Sciences sales grew 2% and reflected 52% of sales, while currency movements adversely

impacted this customer class by three percentage point compared to 2018. Increased demand in consumables and

related revenues across this customer class more than offset weaker instrument sales, which were affected by the

focus on a new generation of products being prepared for launch and led by the new version of QIAcube Connect.

Results for 2019 also absorbed the adverse effect of the April 2018 divestment of the Applied Testing veterinary

testing assay portfolio.

NGS portfolio orientation and measures to prioritize resource allocationNet SalesCustomer classes:Net sales by product category and customer classNet sales by geographic regionYear ended December 31, 2019Sales (In $ m)% change% of sales 
revenue information by customer class to allow better insight into our operations. This information is estimated using

certain assumptions to allocate revenue among the customer classes.

Year Ended December 31, 2019, Compared to 2018

In 2019, net sales grew 2% to $1.53 billion compared to $1.50 billion in 2018 reflecting growth in consumables

and related revenues which more than offset lower instrument revenues. Consumable and related revenues includes

the contributions from our January 2019 acquisition of N-of-One, which provided net sales of approximately $5.0

million in 2019. We experienced increases across consumables and related revenues (+3% / 89% of sales) due to

strong sales of the QuantiFERON-TB test as well as gains within the Life Sciences customer classes. This more than

outweighed decreases across the instruments portfolio (-8% / 11% of sales) including lower sales of platforms for

assay technologies and the GeneReader NGS Systems despite higher placements of the QIAcube Connect,

QIASymphony and QIAstat-Dx systems. Net sales were negatively impacted by two percentage points from adverse

currency movements against the U.S. dollar.

 An overview of net sales by product category and customer class:

Consumables and related revenues

Instruments

Molecular Diagnostics(1)

Life Sciences

M A N A G E M E N T   R E P O R T

Performance Review

Academia / Applied Testing

Pharma

$ 1,354

$ 172

$ 737

$ 789

$ 487

$ 302

+3%

-8%

+1%

+2%

+2%

+4%

89%

11%

48%

52%

32%

20%

(1) Includes companion diagnostic co-development revenues ($42 million, -28%).

Molecular Diagnostics grew 1% and represented 48% of sales in 2019. Molecular Diagnostics sales were adversely
affected by three percentage points of adverse currency movements compared to 2018. Sales in 2019 included
gains in consumables, in particular for the QuantiFERON-TB test compared to 2018 that was partially offset by
significantly lower revenues from companion diagnostic co-development projects and instruments.

During 2019, Life Sciences sales grew 2% and reflected 52% of sales, while currency movements adversely
impacted this customer class by three percentage point compared to 2018. Increased demand in consumables and
related revenues across this customer class more than offset weaker instrument sales, which were affected by the
focus on a new generation of products being prepared for launch and led by the new version of QIAcube Connect.
Results for 2019 also absorbed the adverse effect of the April 2018 divestment of the Applied Testing veterinary
testing assay portfolio.

Americas

Americas
Americas

Americas

Europe / Middle East / Africa

Europe / Middle East / Africa
Europe / Middle East / Africa

Europe / Middle East / Africa

Asia-Pacific / Japan

Asia-Pacific / Japan
Asia-Pacific / Japan

Asia-Pacific / Japan

$ 722

$ 722
$ 722

$ 722

$ 487

$ 487
$ 487

$ 487

$ 314

$ 314
$ 314

$ 314

+4%

+4%
+4%

+4%

47%

47%
47%

47%

-1%

-1%
-1%

-1%

32%

32%
32%

32%

0%

0%
0%

0%

21%

21%
21%

21%

Top 7 emerging markets: Brazil, Russia, India, China, South Korea, Mexico and Turkey ($250 million, +2%, 16% of sales)

Top 7 emerging markets: Brazil, Russia, India, China, South Korea, Mexico and Turkey ($250 million, +2%, 16% of sales)
Top 7 emerging markets: Brazil, Russia, India, China, South Korea, Mexico and Turkey ($250 million, +2%, 16% of sales)

Top 7 emerging markets: Brazil, Russia, India, China, South Korea, Mexico and Turkey ($250 million, +2%, 16% of sales)

Rest of world represented less than 1% of net sales.

Rest of world represented less than 1% of net sales.
Rest of world represented less than 1% of net sales.

Rest of world represented less than 1% of net sales.

The Americas led the geographic regions with 4% sales growth in 2019 with continued improvements within Life
Sciences and overall gains in the United States, Brazil and Mexico against a decline in Canada. The Asia-Pacific /
Japan region in 2019 was flat due primarily to the weaker results in China and Japan against gains in India. The
EMEA region experienced a 1% decline due in part to declines in France and Italy against improving trends in
Germany, Turkey and the United Kingdom.

The Americas led the geographic regions with 4% sales growth in 2019 with continued improvements within Life
The Americas led the geographic regions with 4% sales growth in 2019 with continued improvements within Life
The Americas led the geographic regions with 4% sales growth in 2019 with continued improvements within Life
Sciences and overall gains in the United States, Brazil and Mexico against a decline in Canada. The Asia-Pacific /
Sciences and overall gains in the United States, Brazil and Mexico against a decline in Canada. The Asia-Pacific /
Sciences and overall gains in the United States, Brazil and Mexico against a decline in Canada. The Asia-Pacific /
Japan region in 2019 was flat due primarily to the weaker results in China and Japan against gains in India. The
Japan region in 2019 was flat due primarily to the weaker results in China and Japan against gains in India. The
Japan region in 2019 was flat due primarily to the weaker results in China and Japan against gains in India. The
EMEA region experienced a 1% decline due in part to declines in France and Italy against improving trends in
EMEA region experienced a 1% decline due in part to declines in France and Italy against improving trends in
EMEA region experienced a 1% decline due in part to declines in France and Italy against improving trends in
Germany, Turkey and the United Kingdom.
Germany, Turkey and the United Kingdom.
Germany, Turkey and the United Kingdom.

Gross profit was $1.01 billion, or 66% of net sales, in 2019, compared with $1.00 billion, or 67% of net sales, in
Gross profit was $1.01 billion, or 66% of net sales, in 2019, compared with $1.00 billion, or 67% of net sales, in
Gross profit was $1.01 billion, or 66% of net sales, in 2019, compared with $1.00 billion, or 67% of net sales, in
Gross profit was $1.01 billion, or 66% of net sales, in 2019, compared with $1.00 billion, or 67% of net sales, in
2018. Generally, our consumables and related products have a higher gross margin than our instrumentation
2018. Generally, our consumables and related products have a higher gross margin than our instrumentation
2018. Generally, our consumables and related products have a higher gross margin than our instrumentation
2018. Generally, our consumables and related products have a higher gross margin than our instrumentation
products and service arrangements. Fluctuations in the sales levels of these products and services can result in
products and service arrangements. Fluctuations in the sales levels of these products and services can result in
products and service arrangements. Fluctuations in the sales levels of these products and services can result in
products and service arrangements. Fluctuations in the sales levels of these products and services can result in
changes in gross margin between periods. The growth in consumables and related revenue during 2019 contributed
changes in gross margin between periods. The growth in consumables and related revenue during 2019 contributed
changes in gross margin between periods. The growth in consumables and related revenue during 2019 contributed
changes in gross margin between periods. The growth in consumables and related revenue during 2019 contributed
favorably to the margin, which was negatively impacted by higher amortization expenses related to developed
favorably to the margin, which was negatively impacted by higher amortization expenses related to developed
favorably to the margin, which was negatively impacted by higher amortization expenses related to developed
favorably to the margin, which was negatively impacted by higher amortization expenses related to developed
technology and patent and license rights that were acquired in business combinations or asset acquisitions. The
technology and patent and license rights that were acquired in business combinations or asset acquisitions. The
technology and patent and license rights that were acquired in business combinations or asset acquisitions. The
technology and patent and license rights that were acquired in business combinations or asset acquisitions. The
amortization expense on acquisition-related intangibles within cost of sales increased to $71.5 million in 2019 from
amortization expense on acquisition-related intangibles within cost of sales increased to $71.5 million in 2019 from
amortization expense on acquisition-related intangibles within cost of sales increased to $71.5 million in 2019 from
amortization expense on acquisition-related intangibles within cost of sales increased to $71.5 million in 2019 from
$56.7 million in 2018. The increase was due to the asset acquisition from Formulatrix as further discussed in Note 5
$56.7 million in 2018. The increase was due to the asset acquisition from Formulatrix as further discussed in Note 5
$56.7 million in 2018. The increase was due to the asset acquisition from Formulatrix as further discussed in Note 5
$56.7 million in 2018. The increase was due to the asset acquisition from Formulatrix as further discussed in Note 5
"Acquisitions and Divestitures". We expect that our acquisition-related intangible amortization will increase as a
"Acquisitions and Divestitures". We expect that our acquisition-related intangible amortization will increase as a
"Acquisitions and Divestitures". We expect that our acquisition-related intangible amortization will increase as a
"Acquisitions and Divestitures". We expect that our acquisition-related intangible amortization will increase as a
result of further acquisitions in the future.
result of further acquisitions in the future.
result of further acquisitions in the future.
result of further acquisitions in the future.

Research and development expenses fell by 3% to $157.4 million (10% of net sales) in 2019, from $161.9 million
Research and development expenses fell by 3% to $157.4 million (10% of net sales) in 2019, from $161.9 million
Research and development expenses fell by 3% to $157.4 million (10% of net sales) in 2019, from $161.9 million
Research and development expenses fell by 3% to $157.4 million (10% of net sales) in 2019, from $161.9 million
(11% of net sales) in 2018. The net decrease reflected higher investments in QIAstat-Dx and the planned launch of a
(11% of net sales) in 2018. The net decrease reflected higher investments in QIAstat-Dx and the planned launch of a
(11% of net sales) in 2018. The net decrease reflected higher investments in QIAstat-Dx and the planned launch of a
(11% of net sales) in 2018. The net decrease reflected higher investments in QIAstat-Dx and the planned launch of a
digital PCR system against the significant reduction in costs following the decision to discontinue development of
digital PCR system against the significant reduction in costs following the decision to discontinue development of
digital PCR system against the significant reduction in costs following the decision to discontinue development of
digital PCR system against the significant reduction in costs following the decision to discontinue development of
NGS-related instrument systems. As we continue to discover, develop and acquire new products and technologies,
NGS-related instrument systems. As we continue to discover, develop and acquire new products and technologies,
NGS-related instrument systems. As we continue to discover, develop and acquire new products and technologies,
NGS-related instrument systems. As we continue to discover, develop and acquire new products and technologies,
we expect to incur additional expenses related to facilities, licenses and employees engaged in research and
we expect to incur additional expenses related to facilities, licenses and employees engaged in research and
we expect to incur additional expenses related to facilities, licenses and employees engaged in research and
we expect to incur additional expenses related to facilities, licenses and employees engaged in research and
development. Overall, research and development costs are expected to increase as a result of seeking regulatory
development. Overall, research and development costs are expected to increase as a result of seeking regulatory
development. Overall, research and development costs are expected to increase as a result of seeking regulatory
development. Overall, research and development costs are expected to increase as a result of seeking regulatory
approvals, including U.S. FDA Pre-Market Approval (PMA), U.S. FDA 510(k) clearance and EU CE approval of
approvals, including U.S. FDA Pre-Market Approval (PMA), U.S. FDA 510(k) clearance and EU CE approval of
approvals, including U.S. FDA Pre-Market Approval (PMA), U.S. FDA 510(k) clearance and EU CE approval of
approvals, including U.S. FDA Pre-Market Approval (PMA), U.S. FDA 510(k) clearance and EU CE approval of
79
certain assays or instruments, but to decline as a percentage of sales in 2020 compared to 2019.
certain assays or instruments, but to decline as a percentage of sales in 2020 compared to 2019.
certain assays or instruments, but to decline as a percentage of sales in 2020 compared to 2019.
certain assays or instruments, but to decline as a percentage of sales in 2020 compared to 2019.

Sales and marketing expenses were essentially unchanged at $391.9 million (26% of net sales) in 2019 compared

Sales and marketing expenses were essentially unchanged at $391.9 million (26% of net sales) in 2019 compared

Sales and marketing expenses were essentially unchanged at $391.9 million (26% of net sales) in 2019 compared

Sales and marketing expenses were essentially unchanged at $391.9 million (26% of net sales) in 2019 compared

to $392.3 million (26% of net sales) in 2018. Sales and marketing expenses were primarily associated with

to $392.3 million (26% of net sales) in 2018. Sales and marketing expenses were primarily associated with

to $392.3 million (26% of net sales) in 2018. Sales and marketing expenses were primarily associated with

to $392.3 million (26% of net sales) in 2018. Sales and marketing expenses were primarily associated with

personnel, commissions, advertising, trade shows, publications, freight and logistics expenses, and other promotional

personnel, commissions, advertising, trade shows, publications, freight and logistics expenses, and other promotional

personnel, commissions, advertising, trade shows, publications, freight and logistics expenses, and other promotional

personnel, commissions, advertising, trade shows, publications, freight and logistics expenses, and other promotional

expense. Higher costs in 2019 related to an increase in sales personnel, which was partially offset by lower share-

expense. Higher costs in 2019 related to an increase in sales personnel, which was partially offset by lower share-

expense. Higher costs in 2019 related to an increase in sales personnel, which was partially offset by lower share-

expense. Higher costs in 2019 related to an increase in sales personnel, which was partially offset by lower share-

based compensation and reduced third-party marketing activities. We anticipate that absolute sales and marketing

based compensation and reduced third-party marketing activities. We anticipate that absolute sales and marketing

based compensation and reduced third-party marketing activities. We anticipate that absolute sales and marketing

based compensation and reduced third-party marketing activities. We anticipate that absolute sales and marketing

costs will increase along with new product introductions and growth in sales of our products, but decrease as a

costs will increase along with new product introductions and growth in sales of our products, but decrease as a

costs will increase along with new product introductions and growth in sales of our products, but decrease as a

costs will increase along with new product introductions and growth in sales of our products, but decrease as a

percentage of sales.

percentage of sales.

percentage of sales.

percentage of sales.

Net SalesCustomer classes:Net sales by product category and customer classNet sales by geographic regionYear ended December 31, 2019Sales (In $ m)% change% of salesGross ProfitResearch and DevelopmentSales and MarketingGeneral and AdministrativeYear ended December 31, 2019Sales (In $ m)% change% of salesGross ProfitResearch and DevelopmentSales and MarketingGeneral and AdministrativeYear ended December 31, 2019Sales (In $ m)% change% of salesGross ProfitResearch and DevelopmentSales and MarketingGeneral and AdministrativeYear ended December 31, 2019Sales (In $ m)% change% of salesGross ProfitResearch and DevelopmentSales and MarketingGeneral and AdministrativeYear ended December 31, 2019Sales (In $ m)% change% of sales 
Americas

Europe / Middle East / Africa

Asia-Pacific / Japan

$ 722

$ 487

$ 314

+4%

-1%

0%

47%

32%

21%

Top 7 emerging markets: Brazil, Russia, India, China, South Korea, Mexico and Turkey ($250 million, +2%, 16% of sales)

Rest of world represented less than 1% of net sales.

The Americas led the geographic regions with 4% sales growth in 2019 with continued improvements within Life

Sciences and overall gains in the United States, Brazil and Mexico against a decline in Canada. The Asia-Pacific /

Japan region in 2019 was flat due primarily to the weaker results in China and Japan against gains in India. The

EMEA region experienced a 1% decline due in part to declines in France and Italy against improving trends in

Germany, Turkey and the United Kingdom.

Gross profit was $1.01 billion, or 66% of net sales, in 2019, compared with $1.00 billion, or 67% of net sales, in

2018. Generally, our consumables and related products have a higher gross margin than our instrumentation

products and service arrangements. Fluctuations in the sales levels of these products and services can result in
changes in gross margin between periods. The growth in consumables and related revenue during 2019 contributed
favorably to the margin, which was negatively impacted by higher amortization expenses related to developed
technology and patent and license rights that were acquired in business combinations or asset acquisitions. The
amortization expense on acquisition-related intangibles within cost of sales increased to $71.5 million in 2019 from
$56.7 million in 2018. The increase was due to the asset acquisition from Formulatrix as further discussed in Note 5
"Acquisitions and Divestitures". We expect that our acquisition-related intangible amortization will increase as a
result of further acquisitions in the future.

Research and development expenses fell by 3% to $157.4 million (10% of net sales) in 2019, from $161.9 million
(11% of net sales) in 2018. The net decrease reflected higher investments in QIAstat-Dx and the planned launch of a
digital PCR system against the significant reduction in costs following the decision to discontinue development of
NGS-related instrument systems. As we continue to discover, develop and acquire new products and technologies,
we expect to incur additional expenses related to facilities, licenses and employees engaged in research and
development. Overall, research and development costs are expected to increase as a result of seeking regulatory
approvals, including U.S. FDA Pre-Market Approval (PMA), U.S. FDA 510(k) clearance and EU CE approval of
certain assays or instruments, but to decline as a percentage of sales in 2020 compared to 2019.

Sales and marketing expenses were essentially unchanged at $391.9 million (26% of net sales) in 2019 compared
to $392.3 million (26% of net sales) in 2018. Sales and marketing expenses were primarily associated with
personnel, commissions, advertising, trade shows, publications, freight and logistics expenses, and other promotional
expense. Higher costs in 2019 related to an increase in sales personnel, which was partially offset by lower share-
based compensation and reduced third-party marketing activities. We anticipate that absolute sales and marketing
costs will increase along with new product introductions and growth in sales of our products, but decrease as a
percentage of sales.

General and administrative expenses increased by 7% to $112.3 million (7% of net sales) in 2019 from $104.6
million (7% of net sales) in 2018. The increase in general and administrative expenses in 2019 was primarily due to
higher licensing costs in connection with continued investments in information technology systems, including cyber
security, across the organization as well as an increase in the number of administrative personnel and higher share-
based compensation expenses.

Amortization expense related to developed technology and patent and license rights acquired in a business
combination is included in cost of sales. Amortization of trademarks and customer base acquired in a business
combination is recorded in operating expense under the caption “acquisition-related intangible amortization.”
Amortization expenses of intangible assets not acquired in a business combination are recorded within cost of sales,
research and development, or sales and marketing line items based on the use of the asset.

During 2019, amortization expense on acquisition-related intangibles within operating expense decreased to $30.0
million, compared to $39.0 million in 2018. The decrease follows the full amortization of assets previously acquired
in 2007. We expect acquisition-related intangible amortization will increase as a result of our future acquisitions.

Restructuring, acquisition, integration and other, net was expense of $199.8 million in 2019 as compared to $28.7
million in 2018. During 2019, $163.0 million of charges are included in the 2019 Restructuring program as further
discussed in Note 6 "Restructuring and Impairments". We expect to incur additional restructuring cost in 2020 as
disclosed therein. In addition, during 2019, we continued to incur acquisition and integration costs related to the
acquisitions discussed in Note 5 "Acquisitions and Divestitures". In addition, a $7.4 million gain from the reduction
in the fair value of contingent consideration was recognized during 2019 discussed in Note 15 "Financial
Instruments and Fair Value Measurements". Further, as we further integrate acquired companies and pursue
opportunities to gain efficiencies, we expect to continue to incur additional business integration costs in 2019.

80
Impairments to intangible assets and property, plant and equipment in 2019 totaled $140.0 million, of which
$138.8 million was incurred in connection with the 2019 restructuring measures as further discussed in Note 6
"Restructuring and Impairments". During 2018, impairments to property, plant and equipment included $1.6 million

related to the 2017 Restructuring program also discussed in Note 6 and $6.3 million related to strategic shifts in our

business.

Total other expense, net was $51.6 million in 2019, compared to $40.8 million in 2018. Total other expense, net is

primarily the result of interest expense, partially offset by interest income and other income (expense), net.

For the year ended December 31, 2019, interest income increased to $22.1 million from $20.9 million in 2018.

Interest income includes interest earned on cash, cash equivalents and short-term investments, income related to

certain interest rate derivatives as discussed in Note 14 "Derivatives and Hedging" in the accompanying

consolidated financial statements and other components including the interest portion of operating lease transactions.

Interest income earned in 2019 includes interest on higher cash balances following the issuance of cash convertible

notes in November 2018.

Interest expense increased to $74.2 million in 2019, compared to $67.3 million in 2018. Interest costs primarily

relate to debt, discussed in Note 16 "Lines of Credit and Debt" in the accompanying consolidated financial

statements and the increase in interest expense reflects the issuance of cash convertible notes in November 2018

which bear interest at a higher rate than the notes that matured in 2019.

Other income (expense), net was $0.4 million of income for the year ended December 31, 2019. Other income

includes $7.8 million of upward adjustments resulting from observable price changes for non-marketable investments

Gross ProfitResearch and DevelopmentSales and MarketingGeneral and AdministrativeYear ended December 31, 2019Sales (In $ m)% change% of salesAcquisition-Related Intangible AmortizationRestructuring, Acquisition, Integration and Other, netLong-lived Asset ImpairmentsOther Income (Expense)General and administrative expenses increased by 7% to $112.3 million (7% of net sales) in 2019 from $104.6

General and administrative expenses increased by 7% to $112.3 million (7% of net sales) in 2019 from $104.6

million (7% of net sales) in 2018. The increase in general and administrative expenses in 2019 was primarily due to

million (7% of net sales) in 2018. The increase in general and administrative expenses in 2019 was primarily due to

higher licensing costs in connection with continued investments in information technology systems, including cyber

higher licensing costs in connection with continued investments in information technology systems, including cyber

security, across the organization as well as an increase in the number of administrative personnel and higher share-

security, across the organization as well as an increase in the number of administrative personnel and higher share-

based compensation expenses.

based compensation expenses.

Amortization expense related to developed technology and patent and license rights acquired in a business

Amortization expense related to developed technology and patent and license rights acquired in a business

combination is included in cost of sales. Amortization of trademarks and customer base acquired in a business

combination is included in cost of sales. Amortization of trademarks and customer base acquired in a business

combination is recorded in operating expense under the caption “acquisition-related intangible amortization.”

combination is recorded in operating expense under the caption “acquisition-related intangible amortization.”

Amortization expenses of intangible assets not acquired in a business combination are recorded within cost of sales,

Amortization expenses of intangible assets not acquired in a business combination are recorded within cost of sales,

research and development, or sales and marketing line items based on the use of the asset.

research and development, or sales and marketing line items based on the use of the asset.

During 2019, amortization expense on acquisition-related intangibles within operating expense decreased to $30.0

During 2019, amortization expense on acquisition-related intangibles within operating expense decreased to $30.0

million, compared to $39.0 million in 2018. The decrease follows the full amortization of assets previously acquired
million, compared to $39.0 million in 2018. The decrease follows the full amortization of assets previously acquired
in 2007. We expect acquisition-related intangible amortization will increase as a result of our future acquisitions.
in 2007. We expect acquisition-related intangible amortization will increase as a result of our future acquisitions.

M A N A G E M E N T   R E P O R T

Performance Review

Restructuring, acquisition, integration and other, net was expense of $199.8 million in 2019 as compared to $28.7
Restructuring, acquisition, integration and other, net was expense of $199.8 million in 2019 as compared to $28.7
million in 2018. During 2019, $163.0 million of charges are included in the 2019 Restructuring program as further
million in 2018. During 2019, $163.0 million of charges are included in the 2019 Restructuring program as further
discussed in Note 6 "Restructuring and Impairments". We expect to incur additional restructuring cost in 2020 as
discussed in Note 6 "Restructuring and Impairments". We expect to incur additional restructuring cost in 2020 as
disclosed therein. In addition, during 2019, we continued to incur acquisition and integration costs related to the
disclosed therein. In addition, during 2019, we continued to incur acquisition and integration costs related to the
acquisitions discussed in Note 5 "Acquisitions and Divestitures". In addition, a $7.4 million gain from the reduction
acquisitions discussed in Note 5 "Acquisitions and Divestitures". In addition, a $7.4 million gain from the reduction
in the fair value of contingent consideration was recognized during 2019 discussed in Note 15 "Financial
in the fair value of contingent consideration was recognized during 2019 discussed in Note 15 "Financial
Instruments and Fair Value Measurements". Further, as we further integrate acquired companies and pursue
Instruments and Fair Value Measurements". Further, as we further integrate acquired companies and pursue
opportunities to gain efficiencies, we expect to continue to incur additional business integration costs in 2019.
opportunities to gain efficiencies, we expect to continue to incur additional business integration costs in 2019.

Impairments to intangible assets and property, plant and equipment in 2019 totaled $140.0 million, of which
Impairments to intangible assets and property, plant and equipment in 2019 totaled $140.0 million, of which
$138.8 million was incurred in connection with the 2019 restructuring measures as further discussed in Note 6
$138.8 million was incurred in connection with the 2019 restructuring measures as further discussed in Note 6
"Restructuring and Impairments". During 2018, impairments to property, plant and equipment included $1.6 million
"Restructuring and Impairments". During 2018, impairments to property, plant and equipment included $1.6 million
related to the 2017 Restructuring program also discussed in Note 6 and $6.3 million related to strategic shifts in our
related to the 2017 Restructuring program also discussed in Note 6 and $6.3 million related to strategic shifts in our
business.
business.

Total other expense, net was $51.6 million in 2019, compared to $40.8 million in 2018. Total other expense, net is
Total other expense, net was $51.6 million in 2019, compared to $40.8 million in 2018. Total other expense, net is
primarily the result of interest expense, partially offset by interest income and other income (expense), net.
primarily the result of interest expense, partially offset by interest income and other income (expense), net.

For the year ended December 31, 2019, interest income increased to $22.1 million from $20.9 million in 2018.
For the year ended December 31, 2019, interest income increased to $22.1 million from $20.9 million in 2018.
Interest income includes interest earned on cash, cash equivalents and short-term investments, income related to
Interest income includes interest earned on cash, cash equivalents and short-term investments, income related to
certain interest rate derivatives as discussed in Note 14 "Derivatives and Hedging" in the accompanying
certain interest rate derivatives as discussed in Note 14 "Derivatives and Hedging" in the accompanying
consolidated financial statements and other components including the interest portion of operating lease transactions.
consolidated financial statements and other components including the interest portion of operating lease transactions.
Interest income earned in 2019 includes interest on higher cash balances following the issuance of cash convertible
Interest income earned in 2019 includes interest on higher cash balances following the issuance of cash convertible
notes in November 2018.
notes in November 2018.

Interest expense increased to $74.2 million in 2019, compared to $67.3 million in 2018. Interest costs primarily
Interest expense increased to $74.2 million in 2019, compared to $67.3 million in 2018. Interest costs primarily
relate to debt, discussed in Note 16 "Lines of Credit and Debt" in the accompanying consolidated financial
relate to debt, discussed in Note 16 "Lines of Credit and Debt" in the accompanying consolidated financial
statements and the increase in interest expense reflects the issuance of cash convertible notes in November 2018
statements and the increase in interest expense reflects the issuance of cash convertible notes in November 2018
which bear interest at a higher rate than the notes that matured in 2019.
which bear interest at a higher rate than the notes that matured in 2019.

Other income (expense), net was $0.4 million of income for the year ended December 31, 2019. Other income
Other income (expense), net was $0.4 million of income for the year ended December 31, 2019. Other income
includes $7.8 million of upward adjustments resulting from observable price changes for non-marketable investments
includes $7.8 million of upward adjustments resulting from observable price changes for non-marketable investments
not accounted for under the equity method, $2.1 million in income from equity-method investments and a $0.7
million gain from receipt of shares in settlement of a zero-book value financial instrument held with a third party, all
as discussed further in Note 10 "Investments". This income was partially offset by impairments, including $4.8
million of impairments in non-marketable investments accounted for under the equity method as discussed further in
Note 10 "Investments", and net losses on foreign currency of $5.7 million for the year ended December 31, 2019.

Other income (expense), net was $5.6 million of income for the year ended December 31, 2018. Other income
includes $13.1 million of upward adjustments resulting from observable price changes for non-marketable
investments not accounted for under the equity method, a $5.1 million gain from the sale of our interest in a non-
publicly traded company and $2.6 million in income from equity-method investments, all as discussed further in Note
10 "Investments". Additionally in 2018, we recorded a divestiture gain of $8.0 million as discussed in Note 5
"Acquisitions and Divestitures". This income was partially offset by impairments, including $6.1 million of
impairments in non-marketable investments accounted for under the equity method as discussed further in Note 10,
and net losses on foreign currency of $12.3 million for the year ended December 31, 2019.

Our effective tax rates differ from The Netherlands statutory tax rate of 25% due in part to our operating subsidiaries
being exposed to tax rates ranging from zero to 35%. In 2019 and 2018, our effective tax rates were 46.7% and
15.7%, respectively. The comparison is impacted by pre-tax book income which was lower in 2019 at a pre-tax
book loss of $77.8 million compared to pre-tax book income of $225.7 million in 2018. Fluctuations in the
distribution of pre-tax (loss) income among our operating subsidiaries can lead to fluctuations of the effective tax rate
81
in the consolidated financial statements. In 2019 and 2018, tax expense on foreign operations was favorably
impacted by lower income tax rates and partial tax exemptions on foreign income primarily derived from operations

in Germany, Singapore, Switzerland, Ireland, Dubai and Luxembourg. These foreign tax benefits are due to a

combination of favorable tax laws, regulations, rulings, and exemptions in these jurisdictions. In particular,

intercompany foreign royalty income in Germany is statutorily exempt from trade tax. Further, we have intercompany

financing arrangements through Luxembourg, Dubai and Ireland in which the intercompany income is partially

See Note 17 "Income Taxes" to the consolidated financial statements for a full reconciliation of the effective tax rate

to The Netherlands statutory rate.

In future periods, our effective tax rate may fluctuate from similar or other factors as discussed in “Changes in tax

laws or their application could adversely affect our results of operations or financial flexibility” in the “Risks” section

exempt.

above.

Foreign Currencies

QIAGEN N.V.’s reporting currency is the U.S. dollar, and most of our subsidiaries’ functional currencies are the local

currencies of the countries in which they are headquartered. All amounts in the financial statements of entities whose

functional currency is not the U.S. dollar are translated into U.S. dollar equivalents at exchange rates as follows: (1)

assets and liabilities at period-end rates, (2) income statement accounts at average exchange rates for the period,

and (3) components of shareholders’ equity at historical rates. Translation gains or losses are recorded in

shareholders’ equity, and transaction gains and losses are reflected in net income. The net loss on foreign currency

transactions is included in other income (expense), net, and in 2019, 2018 and 2017 was $5.7 million, $12.3

million, and $3.3 million, respectively.

In the ordinary course of business, we use derivative instruments, including swaps, forwards and/or options, to

manage potential losses from foreign currency exposures and variable rate debt. The principal objective of such

derivative instruments is to minimize the risks and/or costs associated with global financial and operating activities.

We do not utilize derivative or other financial instruments for trading or speculative purposes. We recognize all

derivatives as either assets or liabilities on the balance sheet, measure those instruments at fair value and recognize

the change in fair value in earnings in the period of change, unless the derivative qualifies as an effective hedge that

Acquisition-Related Intangible AmortizationRestructuring, Acquisition, Integration and Other, netLong-lived Asset ImpairmentsOther Income (Expense)Provision for Income TaxesDerivatives and HedgingAcquisition-Related Intangible AmortizationRestructuring, Acquisition, Integration and Other, netLong-lived Asset ImpairmentsOther Income (Expense)not accounted for under the equity method, $2.1 million in income from equity-method investments and a $0.7

million gain from receipt of shares in settlement of a zero-book value financial instrument held with a third party, all

as discussed further in Note 10 "Investments". This income was partially offset by impairments, including $4.8

million of impairments in non-marketable investments accounted for under the equity method as discussed further in

Note 10 "Investments", and net losses on foreign currency of $5.7 million for the year ended December 31, 2019.

Other income (expense), net was $5.6 million of income for the year ended December 31, 2018. Other income
includes $13.1 million of upward adjustments resulting from observable price changes for non-marketable
investments not accounted for under the equity method, a $5.1 million gain from the sale of our interest in a non-
publicly traded company and $2.6 million in income from equity-method investments, all as discussed further in Note
10 "Investments". Additionally in 2018, we recorded a divestiture gain of $8.0 million as discussed in Note 5
"Acquisitions and Divestitures". This income was partially offset by impairments, including $6.1 million of
impairments in non-marketable investments accounted for under the equity method as discussed further in Note 10,
and net losses on foreign currency of $12.3 million for the year ended December 31, 2019.

Our effective tax rates differ from The Netherlands statutory tax rate of 25% due in part to our operating subsidiaries
being exposed to tax rates ranging from zero to 35%. In 2019 and 2018, our effective tax rates were 46.7% and
15.7%, respectively. The comparison is impacted by pre-tax book income which was lower in 2019 at a pre-tax
book loss of $77.8 million compared to pre-tax book income of $225.7 million in 2018. Fluctuations in the
distribution of pre-tax (loss) income among our operating subsidiaries can lead to fluctuations of the effective tax rate
in the consolidated financial statements. In 2019 and 2018, tax expense on foreign operations was favorably
impacted by lower income tax rates and partial tax exemptions on foreign income primarily derived from operations
in Germany, Singapore, Switzerland, Ireland, Dubai and Luxembourg. These foreign tax benefits are due to a
combination of favorable tax laws, regulations, rulings, and exemptions in these jurisdictions. In particular,
intercompany foreign royalty income in Germany is statutorily exempt from trade tax. Further, we have intercompany
financing arrangements through Luxembourg, Dubai and Ireland in which the intercompany income is partially
exempt.

See Note 17 "Income Taxes" to the consolidated financial statements for a full reconciliation of the effective tax rate
to The Netherlands statutory rate.

In future periods, our effective tax rate may fluctuate from similar or other factors as discussed in “Changes in tax
laws or their application could adversely affect our results of operations or financial flexibility” in the “Risks” section
above.

Foreign Currencies

QIAGEN N.V.’s reporting currency is the U.S. dollar, and most of our subsidiaries’ functional currencies are the local
currencies of the countries in which they are headquartered. All amounts in the financial statements of entities whose
functional currency is not the U.S. dollar are translated into U.S. dollar equivalents at exchange rates as follows: (1)
assets and liabilities at period-end rates, (2) income statement accounts at average exchange rates for the period,
and (3) components of shareholders’ equity at historical rates. Translation gains or losses are recorded in
shareholders’ equity, and transaction gains and losses are reflected in net income. The net loss on foreign currency
transactions is included in other income (expense), net, and in 2019, 2018 and 2017 was $5.7 million, $12.3
million, and $3.3 million, respectively.

In the ordinary course of business, we use derivative instruments, including swaps, forwards and/or options, to
manage potential losses from foreign currency exposures and variable rate debt. The principal objective of such
derivative instruments is to minimize the risks and/or costs associated with global financial and operating activities.
We do not utilize derivative or other financial instruments for trading or speculative purposes. We recognize all
derivatives as either assets or liabilities on the balance sheet, measure those instruments at fair value and recognize
the change in fair value in earnings in the period of change, unless the derivative qualifies as an effective hedge that
offsets certain exposures. In determining fair value, we consider both the counterparty credit risk and our own
creditworthiness, to the extent that the derivatives are not covered by collateral agreements with the respective
counterparties. To determine our own credit risk, we estimated our own credit rating by benchmarking the price of
our outstanding debt to publicly-available comparable data from rated companies. Using the estimated rating, we
quantify our credit risk by reference to publicly-traded debt with a corresponding rating.

As a globally active enterprise, we are subject to risks associated with fluctuations in foreign currencies in our
ordinary operations. This includes foreign currency-denominated receivables, payables, debt, and other balance
sheet positions including intercompany items. We manage our balance sheet exposure on a group-wide basis using
foreign exchange forwards, options and cross-currency swaps.

82

We use interest rate derivative contracts on certain borrowing transactions to hedge interest rate exposures. We

have entered into interest rate swaps in which we agree to exchange, at specified intervals, the difference between

fixed and floating interest amounts calculated by reference to an agreed-upon notional principal amount.

We also make use of economic hedges. Further details of our derivative and hedging activities can be found in Note

14 "Derivatives and Hedging" to the accompanying consolidated financial statements.

Liquidity and Capital Resources

To date, we have funded our business primarily through internally generated funds, debt, and private and public

sales of equity. Our primary use of cash has been to support continuing operations and our investing activities

including capital expenditure requirements and acquisitions. As of December 31, 2019 and 2018, we had cash

and cash equivalents of $623.6 million and $1.16 billion, respectively. We also had restricted cash of $5.7 million

and short-term investments of $129.6 million at December 31, 2019. Cash and cash equivalents are primarily held

in U.S. dollars and euros, other than those cash balances maintained in the local currency of subsidiaries to meet

local working capital needs. At December 31, 2019, cash, cash equivalents and restricted cash had decreased by

$529.7 million from December 31, 2018, primarily as a result of cash used financing activities of $639.1 million

and cash used in investing activities of $222.3 million, partially offset by cash provided by operating activities of

$330.8 million. As of December 31, 2019 and 2018, we had working capital of $618.9 million and $1.18 billion,

respectively.

For the years ended December 31, 2019 and 2018, we generated net cash from operating activities of $330.8

million and $359.5 million, respectively. While the net loss was $41.5 million in 2019, non-cash components in

income included $231.5 million of depreciation and amortization and $144.8 million non-cash impairments

primarily recorded in connection with the restructuring discussed in Note 6 "Restructuring and Impairments", $40.8

million of amortization of debt discount and issuance costs and $65.9 million of share-based compensation expense.

Operating cash flows include a net decrease in working capital of $28.6 million excluding changes in fair value of

derivative instruments. The current period change in working capital is primarily due to increased inventories and

accounts receivable and decreased accrued and other current liabilities. Because we rely heavily on cash generated

from operating activities to fund our business, a decrease in demand for our products, longer collection cycles or

significant technological advances of competitors would have a negative impact on our liquidity.

Approximately $222.3 million of cash was used in investing activities during 2019, compared to $211.4 million

during 2018. Investing activities during 2019 consisted principally of $294.0 million for purchases of short-term

investments, $68.1 million in cash paid for acquisitions, net of cash acquired as discussed in Note 5 "Acquisitions

and Divestitures", $118.0 million in cash paid for purchases of property and equipment, as well as $156.9 million

paid for intangible assets and $5.2 million paid for strategic investments in privately and publicly held companies as

discussed in Note 10 "Investments", partially offset by $396.1 million from the sale of short-term investments.

Investing activities during 2018 consisted principally of $172.8 million of cash paid for acquisitions, net of cash

Provision for Income TaxesDerivatives and HedgingForeign Currency DerivativesInterest Rate DerivativesOperating ActivitiesInvesting ActivitiesM A N A G E M E N T   R E P O R T

Performance Review

offsets certain exposures. In determining fair value, we consider both the counterparty credit risk and our own
creditworthiness, to the extent that the derivatives are not covered by collateral agreements with the respective
counterparties. To determine our own credit risk, we estimated our own credit rating by benchmarking the price of
our outstanding debt to publicly-available comparable data from rated companies. Using the estimated rating, we
quantify our credit risk by reference to publicly-traded debt with a corresponding rating.

As a globally active enterprise, we are subject to risks associated with fluctuations in foreign currencies in our
ordinary operations. This includes foreign currency-denominated receivables, payables, debt, and other balance
sheet positions including intercompany items. We manage our balance sheet exposure on a group-wide basis using
foreign exchange forwards, options and cross-currency swaps.

We use interest rate derivative contracts on certain borrowing transactions to hedge interest rate exposures. We
have entered into interest rate swaps in which we agree to exchange, at specified intervals, the difference between
fixed and floating interest amounts calculated by reference to an agreed-upon notional principal amount.

We also make use of economic hedges. Further details of our derivative and hedging activities can be found in Note
14 "Derivatives and Hedging" to the accompanying consolidated financial statements.

Liquidity and Capital Resources

To date, we have funded our business primarily through internally generated funds, debt, and private and public
sales of equity. Our primary use of cash has been to support continuing operations and our investing activities
including capital expenditure requirements and acquisitions. As of December 31, 2019 and 2018, we had cash
and cash equivalents of $623.6 million and $1.16 billion, respectively. We also had restricted cash of $5.7 million
and short-term investments of $129.6 million at December 31, 2019. Cash and cash equivalents are primarily held
in U.S. dollars and euros, other than those cash balances maintained in the local currency of subsidiaries to meet
local working capital needs. At December 31, 2019, cash, cash equivalents and restricted cash had decreased by
$529.7 million from December 31, 2018, primarily as a result of cash used financing activities of $639.1 million
and cash used in investing activities of $222.3 million, partially offset by cash provided by operating activities of
$330.8 million. As of December 31, 2019 and 2018, we had working capital of $618.9 million and $1.18 billion,
respectively.

For the years ended December 31, 2019 and 2018, we generated net cash from operating activities of $330.8
million and $359.5 million, respectively. While the net loss was $41.5 million in 2019, non-cash components in
income included $231.5 million of depreciation and amortization and $144.8 million non-cash impairments
primarily recorded in connection with the restructuring discussed in Note 6 "Restructuring and Impairments", $40.8
million of amortization of debt discount and issuance costs and $65.9 million of share-based compensation expense.
Operating cash flows include a net decrease in working capital of $28.6 million excluding changes in fair value of
derivative instruments. The current period change in working capital is primarily due to increased inventories and
accounts receivable and decreased accrued and other current liabilities. Because we rely heavily on cash generated
from operating activities to fund our business, a decrease in demand for our products, longer collection cycles or
significant technological advances of competitors would have a negative impact on our liquidity.

Approximately $222.3 million of cash was used in investing activities during 2019, compared to $211.4 million
during 2018. Investing activities during 2019 consisted principally of $294.0 million for purchases of short-term
investments, $68.1 million in cash paid for acquisitions, net of cash acquired as discussed in Note 5 "Acquisitions
and Divestitures", $118.0 million in cash paid for purchases of property and equipment, as well as $156.9 million
paid for intangible assets and $5.2 million paid for strategic investments in privately and publicly held companies as
discussed in Note 10 "Investments", partially offset by $396.1 million from the sale of short-term investments.
Investing activities during 2018 consisted principally of $172.8 million of cash paid for acquisitions, net of cash

83

Foreign Currency DerivativesInterest Rate DerivativesOperating ActivitiesInvesting Activitiesoffsets certain exposures. In determining fair value, we consider both the counterparty credit risk and our own

creditworthiness, to the extent that the derivatives are not covered by collateral agreements with the respective

counterparties. To determine our own credit risk, we estimated our own credit rating by benchmarking the price of

our outstanding debt to publicly-available comparable data from rated companies. Using the estimated rating, we

quantify our credit risk by reference to publicly-traded debt with a corresponding rating.

As a globally active enterprise, we are subject to risks associated with fluctuations in foreign currencies in our

ordinary operations. This includes foreign currency-denominated receivables, payables, debt, and other balance

sheet positions including intercompany items. We manage our balance sheet exposure on a group-wide basis using

foreign exchange forwards, options and cross-currency swaps.

We use interest rate derivative contracts on certain borrowing transactions to hedge interest rate exposures. We

have entered into interest rate swaps in which we agree to exchange, at specified intervals, the difference between

fixed and floating interest amounts calculated by reference to an agreed-upon notional principal amount.

We also make use of economic hedges. Further details of our derivative and hedging activities can be found in Note

14 "Derivatives and Hedging" to the accompanying consolidated financial statements.

Liquidity and Capital Resources

To date, we have funded our business primarily through internally generated funds, debt, and private and public

sales of equity. Our primary use of cash has been to support continuing operations and our investing activities

including capital expenditure requirements and acquisitions. As of December 31, 2019 and 2018, we had cash

and cash equivalents of $623.6 million and $1.16 billion, respectively. We also had restricted cash of $5.7 million

and short-term investments of $129.6 million at December 31, 2019. Cash and cash equivalents are primarily held

in U.S. dollars and euros, other than those cash balances maintained in the local currency of subsidiaries to meet

local working capital needs. At December 31, 2019, cash, cash equivalents and restricted cash had decreased by

$529.7 million from December 31, 2018, primarily as a result of cash used financing activities of $639.1 million

and cash used in investing activities of $222.3 million, partially offset by cash provided by operating activities of

$330.8 million. As of December 31, 2019 and 2018, we had working capital of $618.9 million and $1.18 billion,

respectively.

For the years ended December 31, 2019 and 2018, we generated net cash from operating activities of $330.8

million and $359.5 million, respectively. While the net loss was $41.5 million in 2019, non-cash components in

income included $231.5 million of depreciation and amortization and $144.8 million non-cash impairments

primarily recorded in connection with the restructuring discussed in Note 6 "Restructuring and Impairments", $40.8

million of amortization of debt discount and issuance costs and $65.9 million of share-based compensation expense.

Operating cash flows include a net decrease in working capital of $28.6 million excluding changes in fair value of

derivative instruments. The current period change in working capital is primarily due to increased inventories and

accounts receivable and decreased accrued and other current liabilities. Because we rely heavily on cash generated

from operating activities to fund our business, a decrease in demand for our products, longer collection cycles or

significant technological advances of competitors would have a negative impact on our liquidity.

Approximately $222.3 million of cash was used in investing activities during 2019, compared to $211.4 million
during 2018. Investing activities during 2019 consisted principally of $294.0 million for purchases of short-term
investments, $68.1 million in cash paid for acquisitions, net of cash acquired as discussed in Note 5 "Acquisitions
and Divestitures", $118.0 million in cash paid for purchases of property and equipment, as well as $156.9 million
paid for intangible assets and $5.2 million paid for strategic investments in privately and publicly held companies as
discussed in Note 10 "Investments", partially offset by $396.1 million from the sale of short-term investments.
Investing activities during 2018 consisted principally of $172.8 million of cash paid for acquisitions, net of cash
acquired, $568.0 million for purchases of short-term investments, partially offset by $691.8 million from the sale of
short-term investments.

For the year ended December 31, 2019, cash used in financing activities was $639.1 million compared to cash
provided by financing activities of $360.4 million in 2018. Financing activities during 2019 consisted primarily of
$506.4 million repayments of long-term debt including $430.0 million for the amount due for the 2019 Cash
Convertible Notes, $73.0 million for amounts due for the U.S. Private Placement and $3.4 million for a portion of the
2021 Cash Convertible Notes which was converted during the contingent conversion period as discussed further in
Note 16 "Lines of Credit and Debt". In addition, repurchases of QIAGEN shares totaled $74.5 million during 2019.

In 2018, cash provided from financing activities totaled $360.4 million primarily due to $494.9 million net cash
proceeds from the 2018 cash convertible offering. We used $97.3 million of the proceeds from the from the cash
convertible offering to pay the premium for a call option related to the cash convertible notes, and simultaneously
received $72.4 million from the sale of Warrants, for a net cash outlay of $24.9 million for the call spread overlay.
Cash provided in 2018 was further offset by the repurchase of QIAGEN shares totaling $104.7 million.

Cash used in other financing activities during the year ended December 31, 2019 and 2018 consisted primarily of
$10.5 million and $5.5 million paid for contingent consideration, respectively, together with $0.4 million cash
received and $2.0 million cash paid in connection with derivative collateral arrangements, respectively.

Other Factors Affecting Liquidity and Capital Resources

In November 2018, we issued $500.0 million aggregate principal amount of Cash Convertible Senior Notes which
is due in 2024 (2024 Notes). The net proceeds of the 2024 Notes were $470.0 million, after payment of the net
cost of the Call Spread Overlay and transaction costs paid through December 31, 2019 as described more fully in
Note 16 "Lines of Credit and Debt". Interest on the 2024 Notes is payable semiannually in arrears at a rate of
1.000% per annum. The 2024 Notes will mature on November 13, 2024 unless repurchased or converted in
accordance with their terms prior to such date.

In September 2017, we issued $400.0 million aggregate principal amount of Cash Convertible Senior Notes which
are due in 2023 (2023 Notes), which are discussed fully in Note 16 "Lines of Credit and Debt". Interest on the
2023 Notes is payable semiannually in arrears at a rate of 0.500% per annum. The 2023 Notes will mature on
September 13, 2023 unless repurchased or converted in accordance with their terms prior to such date.

Additionally in 2017, we completed a German private placement of $329.9 million, net of issuance costs, consisting
of several tranches denominated in either U.S. dollars or Euro at either floating or fixed rates and due at various
dates through June 2027 as described in Note 16 "Lines of Credit and Debt".

In October 2016, we extended the maturity of our €400 million syndicated revolving credit facility, which now has
a contractual lifetime until December 2021 of which no amounts were utilized at December 31, 2019. The facility
can be utilized in Euro, British pounds sterling, Swiss franc or U.S. dollar and bears interest of 0.40% to 1.20%
above three months EURIBOR, or LIBOR in relation to any loan not in euro, and is offered with interest periods of
one, two, three or six months. We have additional credit lines totaling €26.6 million with no expiration date, none
of which were utilized as of December 31, 2019.

In March 2014, we issued $730.0 million aggregate principal amount of Cash Convertible Senior Notes of which
$433.4 million was paid in 2019 and $296.6 million is due in 2021 (2021 Notes). Interest on the 2021 Notes is
payable semiannually in arrears on September 19 of each year, at rate of 0.875% per annum. The 2021 Notes will
mature on March 19, 2021, unless repurchased or converted in accordance with their terms prior to such date.

84

In October 2012, we completed a U.S. private placement through the issuance of new senior unsecured notes at a
total amount of $400 million with a weighted average interest rate of 3.66% (settled on October 16, 2012). The

Foreign Currency DerivativesInterest Rate DerivativesOperating ActivitiesInvesting ActivitiesFinancing Activitiesacquired, $568.0 million for purchases of short-term investments, partially offset by $691.8 million from the sale of

short-term investments.

For the year ended December 31, 2019, cash used in financing activities was $639.1 million compared to cash

provided by financing activities of $360.4 million in 2018. Financing activities during 2019 consisted primarily of

$506.4 million repayments of long-term debt including $430.0 million for the amount due for the 2019 Cash

Convertible Notes, $73.0 million for amounts due for the U.S. Private Placement and $3.4 million for a portion of the

2021 Cash Convertible Notes which was converted during the contingent conversion period as discussed further in

Note 16 "Lines of Credit and Debt". In addition, repurchases of QIAGEN shares totaled $74.5 million during 2019.

In 2018, cash provided from financing activities totaled $360.4 million primarily due to $494.9 million net cash

proceeds from the 2018 cash convertible offering. We used $97.3 million of the proceeds from the from the cash

convertible offering to pay the premium for a call option related to the cash convertible notes, and simultaneously

received $72.4 million from the sale of Warrants, for a net cash outlay of $24.9 million for the call spread overlay.

Cash provided in 2018 was further offset by the repurchase of QIAGEN shares totaling $104.7 million.

Cash used in other financing activities during the year ended December 31, 2019 and 2018 consisted primarily of

$10.5 million and $5.5 million paid for contingent consideration, respectively, together with $0.4 million cash

received and $2.0 million cash paid in connection with derivative collateral arrangements, respectively.

Other Factors Affecting Liquidity and Capital Resources

In November 2018, we issued $500.0 million aggregate principal amount of Cash Convertible Senior Notes which

is due in 2024 (2024 Notes). The net proceeds of the 2024 Notes were $470.0 million, after payment of the net

cost of the Call Spread Overlay and transaction costs paid through December 31, 2019 as described more fully in

Note 16 "Lines of Credit and Debt". Interest on the 2024 Notes is payable semiannually in arrears at a rate of

1.000% per annum. The 2024 Notes will mature on November 13, 2024 unless repurchased or converted in

accordance with their terms prior to such date.

In September 2017, we issued $400.0 million aggregate principal amount of Cash Convertible Senior Notes which

are due in 2023 (2023 Notes), which are discussed fully in Note 16 "Lines of Credit and Debt". Interest on the

2023 Notes is payable semiannually in arrears at a rate of 0.500% per annum. The 2023 Notes will mature on

September 13, 2023 unless repurchased or converted in accordance with their terms prior to such date.

Additionally in 2017, we completed a German private placement of $329.9 million, net of issuance costs, consisting

of several tranches denominated in either U.S. dollars or Euro at either floating or fixed rates and due at various

dates through June 2027 as described in Note 16 "Lines of Credit and Debt".

Performance Review

M A N A G E M E N T   R E P O R T
In October 2016, we extended the maturity of our €400 million syndicated revolving credit facility, which now has
a contractual lifetime until December 2021 of which no amounts were utilized at December 31, 2019. The facility
can be utilized in Euro, British pounds sterling, Swiss franc or U.S. dollar and bears interest of 0.40% to 1.20%
above three months EURIBOR, or LIBOR in relation to any loan not in euro, and is offered with interest periods of
one, two, three or six months. We have additional credit lines totaling €26.6 million with no expiration date, none
of which were utilized as of December 31, 2019.

In March 2014, we issued $730.0 million aggregate principal amount of Cash Convertible Senior Notes of which
$433.4 million was paid in 2019 and $296.6 million is due in 2021 (2021 Notes). Interest on the 2021 Notes is
payable semiannually in arrears on September 19 of each year, at rate of 0.875% per annum. The 2021 Notes will
mature on March 19, 2021, unless repurchased or converted in accordance with their terms prior to such date.

In October 2012, we completed a U.S. private placement through the issuance of new senior unsecured notes at a
total amount of $400 million with a weighted average interest rate of 3.66% (settled on October 16, 2012). The
notes were issued in three series: (1) $73 million 7-year term due and paid in 2019 (3.19%); (2) $300 million 10-
year term due in 2022 (3.75%); and (3) $27 million 12-year term due in 2024 (3.90%).

As of December 31, 2019, we carry $1.7 billion of long-term debt, of which $285.2 million is current. We did not
hold any material finance leases as of December 31, 2019.

In connection with certain acquisitions, we could be required to make additional contingent cash payments totaling
up to $179.4 million based on the achievement of certain revenue and operating results milestones as further
discussed in Note 20 "Commitments and Contingencies".

In January 2018, we announced our fifth share repurchase program of up to $200 million of our common shares.
During 2019, we repurchased 2.0 million QIAGEN shares for $74.5 million (including transaction costs) bringing
the total shares repurchased under this program to 4.9 million for $179.1 million (including transaction costs).
Repurchased shares will be held in treasury in order to satisfy various obligations, which include employee share-
based remuneration plans. Repurchased shares will be held in treasury in order to satisfy various obligations, which
include employee share-based remuneration plans.

In January 2017, we completed a synthetic share repurchase that combined a direct capital repayment with a
consolidation of shares. The transaction was announced in August 2016 and involved an approach used by various
large, multinational Dutch companies to provide returns to shareholders in a faster and more efficient manner than
traditional open-market purchases. $243.9 million was repaid to shareholders through the transaction and the
outstanding number of common shares was reduced by 8.9 million, or 3.7%. As discussed further in Note 18
"Equity", the capital repayment program was completed in January 2017.

We expect that cash from financing activities will continue to be impacted by issuances of our common shares in
connection with our equity compensation plans and that the market performance of our stock will impact the timing
and volume of the issuances. Additionally, we may make future acquisitions or investments requiring cash payments,
the issuance of additional equity or debt financing.

We believe that funds from operations, existing cash and cash equivalents, together with the proceeds from our
public and private sales of equity, and availability of financing facilities, will be sufficient to fund our planned
operations and expansion during the coming year. However, any global economic downturn may have a greater
impact on our business than currently expected, and we may experience a decrease in the sales of our products,
which could impact our ability to generate cash. If our future cash flows from operations and other capital resources
are not adequate to fund our liquidity needs, we may be required to obtain additional debt or equity financing or to
reduce or delay our capital expenditures, acquisitions or research and development projects. If we could not obtain
financing on a timely basis or at satisfactory terms, or implement timely reductions in our expenditures, our business
could be adversely affected.

Off-Balance Sheet Arrangements

Other than our former arrangements with QIAGEN Finance as discussed in Note 16 "Lines of Credit and Debt" to
the consolidated financial statements, we did not use special purpose entities and do not have off-balance sheet
financing arrangements as of and during the years ended December 31, 2019, 2018 and 2017.

85

As of December 31, 2019, our future contractual cash obligations are as follows:

Financing ActivitiesContractual Obligationsnotes were issued in three series: (1) $73 million 7-year term due and paid in 2019 (3.19%); (2) $300 million 10-

year term due in 2022 (3.75%); and (3) $27 million 12-year term due in 2024 (3.90%).

As of December 31, 2019, we carry $1.7 billion of long-term debt, of which $285.2 million is current. We did not

hold any material finance leases as of December 31, 2019.

In connection with certain acquisitions, we could be required to make additional contingent cash payments totaling

up to $179.4 million based on the achievement of certain revenue and operating results milestones as further

discussed in Note 20 "Commitments and Contingencies".

In January 2018, we announced our fifth share repurchase program of up to $200 million of our common shares.

During 2019, we repurchased 2.0 million QIAGEN shares for $74.5 million (including transaction costs) bringing

the total shares repurchased under this program to 4.9 million for $179.1 million (including transaction costs).

Repurchased shares will be held in treasury in order to satisfy various obligations, which include employee share-

based remuneration plans. Repurchased shares will be held in treasury in order to satisfy various obligations, which

include employee share-based remuneration plans.

In January 2017, we completed a synthetic share repurchase that combined a direct capital repayment with a

consolidation of shares. The transaction was announced in August 2016 and involved an approach used by various

large, multinational Dutch companies to provide returns to shareholders in a faster and more efficient manner than

traditional open-market purchases. $243.9 million was repaid to shareholders through the transaction and the

outstanding number of common shares was reduced by 8.9 million, or 3.7%. As discussed further in Note 18

"Equity", the capital repayment program was completed in January 2017.

We expect that cash from financing activities will continue to be impacted by issuances of our common shares in

connection with our equity compensation plans and that the market performance of our stock will impact the timing

and volume of the issuances. Additionally, we may make future acquisitions or investments requiring cash payments,

the issuance of additional equity or debt financing.

We believe that funds from operations, existing cash and cash equivalents, together with the proceeds from our

public and private sales of equity, and availability of financing facilities, will be sufficient to fund our planned
operations and expansion during the coming year. However, any global economic downturn may have a greater
impact on our business than currently expected, and we may experience a decrease in the sales of our products,
which could impact our ability to generate cash. If our future cash flows from operations and other capital resources
are not adequate to fund our liquidity needs, we may be required to obtain additional debt or equity financing or to
reduce or delay our capital expenditures, acquisitions or research and development projects. If we could not obtain
financing on a timely basis or at satisfactory terms, or implement timely reductions in our expenditures, our business
could be adversely affected.

Off-Balance Sheet Arrangements

Other than our former arrangements with QIAGEN Finance as discussed in Note 16 "Lines of Credit and Debt" to
the consolidated financial statements, we did not use special purpose entities and do not have off-balance sheet
financing arrangements as of and during the years ended December 31, 2019, 2018 and 2017.

As of December 31, 2019, our future contractual cash obligations are as follows:

Long-term debt(1)

Long-term debt(1)
Long-term debt(1)

Long-term debt(1)
Long-term debt(1)
Long-term debt(1)
Long-term debt(1)
Long-term debt(1)

Long-term debt(1)

Purchase obligations

Purchase obligations
Purchase obligations

Purchase obligations
Purchase obligations
Purchase obligations
Purchase obligations
Purchase obligations

Purchase obligations

Operating leases

Operating leases
Operating leases

Operating leases
Operating leases
Operating leases
Operating leases
Operating leases

Operating leases

License and royalty payments (2)

License and royalty payments (2)
License and royalty payments (2)

License and royalty payments (2)
License and royalty payments (2)
License and royalty payments (2)
License and royalty payments (2)
License and royalty payments (2)

License and royalty payments (2)

$1,790,350

$1,790,350
$1,790,350

$1,790,350
$1,790,350
$1,790,350
$1,790,350
$1,790,350

$1,790,350

194,596

194,596
194,596

194,596
194,596
194,596
194,596
194,596

194,596

61,520

61,520
61,520

61,520
61,520
61,520
61,520
61,520

61,520

37,455

37,455
37,455

37,455
37,455
37,455
37,455
37,455

37,455

$25,438

$25,438
$25,438

$25,438
$25,438
$25,438
$25,438
$25,438

$25,438

$347,230

$347,230
$347,230

$347,230
$347,230
$347,230
$347,230
$347,230

$347,230

$491,356

$491,356
$491,356

$491,356
$491,356
$491,356
$491,356
$491,356

$491,356

$356,738

$356,738
$356,738

$356,738
$356,738
$356,738
$356,738
$356,738

$356,738

$552,636

$552,636
$552,636

$552,636
$552,636
$552,636
$552,636
$552,636

$552,636

$16,952

$16,952
$16,952

$16,952
$16,952
$16,952
$16,952
$16,952

$16,952

126,121

126,121
126,121

126,121
126,121
126,121
126,121
126,121

126,121

19,914

19,914
19,914

19,914
19,914
19,914
19,914
19,914

19,914

11,434

11,434
11,434

11,434
11,434
11,434
11,434
11,434

11,434

35,915

35,915
35,915

35,915
35,915
35,915
35,915
35,915

35,915

26,337

26,337
26,337

26,337
26,337
26,337
26,337
26,337

26,337

16,009

16,009
16,009

16,009
16,009
16,009
16,009
16,009

16,009

11,885

11,885
11,885

11,885
11,885
11,885
11,885
11,885

11,885

9,012

9,012
9,012

9,012
9,012
9,012
9,012
9,012

9,012

6,507

6,507
6,507

6,507
6,507
6,507
6,507
6,507

6,507

3,223

3,223
3,223

3,223
3,223
3,223
3,223
3,223

3,223

3,000

3,000
3,000

3,000
3,000
3,000
3,000
3,000

3,000

—

—
—

—
—
—
—
—

—

7,119

7,119
7,119

7,119
7,119
7,119
7,119
7,119

7,119

3,391

3,391
3,391

3,391
3,391
3,391
3,391
3,391

3,391

3,202

3,202
3,202

3,202
3,202
3,202
3,202
3,202

3,202

4,382

4,382
4,382

4,382
4,382
4,382
4,382
4,382

4,382

1,823

1,823
1,823

1,823
1,823
1,823
1,823
1,823

1,823

4,297

4,297
4,297

4,297
4,297
4,297
4,297
4,297

4,297

$2,083,921

$2,083,921
$2,083,921

$2,083,921
$2,083,921
$2,083,921
$2,083,921
$2,083,921

$2,083,921

$182,907

$182,907
$182,907

$182,907
$182,907
$182,907
$182,907
$182,907

$182,907

$408,166

$408,166
$408,166

$408,166
$408,166
$408,166
$408,166
$408,166

$408,166

$536,085

$536,085
$536,085

$536,085
$536,085
$536,085
$536,085
$536,085

$536,085

$371,462

$371,462
$371,462

$371,462
$371,462
$371,462
$371,462
$371,462

$371,462

$560,850

$560,850
$560,850

$560,850
$560,850
$560,850
$560,850
$560,850

$560,850

$24,451

$24,451
$24,451

$24,451
$24,451
$24,451
$24,451
$24,451

$24,451

(1)  Amounts include required principal, stated at the current carrying values, and interest payments. Future 2020 contractual
(1)  Amounts include required principal, stated at the current carrying values, and interest payments. Future 2020 contractual
(1)  Amounts include required principal, stated at the current carrying values, and interest payments. Future 2020 contractual
(1)  Amounts include required principal, stated at the current carrying values, and interest payments. Future 2020 contractual
(1)  Amounts include required principal, stated at the current carrying values, and interest payments. Future 2020 contractual
(1)  Amounts include required principal, stated at the current carrying values, and interest payments. Future 2020 contractual
(1)  Amounts include required principal, stated at the current carrying values, and interest payments. Future 2020 contractual
(1)  Amounts include required principal, stated at the current carrying values, and interest payments. Future 2020 contractual
(1)  Amounts include required principal, stated at the current carrying values, and interest payments. Future 2020 contractual
cash obligations include only amounts due in cash. The 2021 Notes that became convertible pursuant to the indenture on
cash obligations include only amounts due in cash. The 2021 Notes that became convertible pursuant to the indenture on
cash obligations include only amounts due in cash. The 2021 Notes that became convertible pursuant to the indenture on
cash obligations include only amounts due in cash. The 2021 Notes that became convertible pursuant to the indenture on
cash obligations include only amounts due in cash. The 2021 Notes that became convertible pursuant to the indenture on
cash obligations include only amounts due in cash. The 2021 Notes that became convertible pursuant to the indenture on
cash obligations include only amounts due in cash. The 2021 Notes that became convertible pursuant to the indenture on
cash obligations include only amounts due in cash. The 2021 Notes that became convertible pursuant to the indenture on
cash obligations include only amounts due in cash. The 2021 Notes that became convertible pursuant to the indenture on
January 1, 2020 as further discussed in Note 16 "Lines of Credit and Debt" and are classified as current as of December 31,
January 1, 2020 as further discussed in Note 16 "Lines of Credit and Debt" and are classified as current as of December 31,
January 1, 2020 as further discussed in Note 16 "Lines of Credit and Debt" and are classified as current as of December 31,
January 1, 2020 as further discussed in Note 16 "Lines of Credit and Debt" and are classified as current as of December 31,
January 1, 2020 as further discussed in Note 16 "Lines of Credit and Debt" and are classified as current as of December 31,
January 1, 2020 as further discussed in Note 16 "Lines of Credit and Debt" and are classified as current as of December 31,
January 1, 2020 as further discussed in Note 16 "Lines of Credit and Debt" and are classified as current as of December 31,
January 1, 2020 as further discussed in Note 16 "Lines of Credit and Debt" and are classified as current as of December 31,
January 1, 2020 as further discussed in Note 16 "Lines of Credit and Debt" and are classified as current as of December 31,
2019, are only convertible during the triggered conversion period and are thus not included as a cash payment until the
2019, are only convertible during the triggered conversion period and are thus not included as a cash payment until the
2019, are only convertible during the triggered conversion period and are thus not included as a cash payment until the
2019, are only convertible during the triggered conversion period and are thus not included as a cash payment until the
2019, are only convertible during the triggered conversion period and are thus not included as a cash payment until the
2019, are only convertible during the triggered conversion period and are thus not included as a cash payment until the
2019, are only convertible during the triggered conversion period and are thus not included as a cash payment until the
2019, are only convertible during the triggered conversion period and are thus not included as a cash payment until the
2019, are only convertible during the triggered conversion period and are thus not included as a cash payment until the
2021 date in the table above.
2021 date in the table above.
2021 date in the table above.
2021 date in the table above.
2021 date in the table above.
2021 date in the table above.
2021 date in the table above.
2021 date in the table above.
2021 date in the table above.

(2)  As of December 31, 2019, $10.0 million and $14.5 million are included in accrued and other current liabilities and
(2)  As of December 31, 2019, $10.0 million and $14.5 million are included in accrued and other current liabilities and
(2)  As of December 31, 2019, $10.0 million and $14.5 million are included in accrued and other current liabilities and
other long-term liabilities, respectively, associated to future license payments.
other long-term liabilities, respectively, associated to future license payments.
other long-term liabilities, respectively, associated to future license payments.

(2)  As of December 31, 2019, $10.0 million and $14.5 million are included in accrued and other current liabilities and
(2)  As of December 31, 2019, $10.0 million and $14.5 million are included in accrued and other current liabilities and
(2)  As of December 31, 2019, $10.0 million and $14.5 million are included in accrued and other current liabilities and
(2)  As of December 31, 2019, $10.0 million and $14.5 million are included in accrued and other current liabilities and
(2)  As of December 31, 2019, $10.0 million and $14.5 million are included in accrued and other current liabilities and
(2)  As of December 31, 2019, $10.0 million and $14.5 million are included in accrued and other current liabilities and
other long-term liabilities, respectively, associated to future license payments.
other long-term liabilities, respectively, associated to future license payments.
other long-term liabilities, respectively, associated to future license payments.
other long-term liabilities, respectively, associated to future license payments.
other long-term liabilities, respectively, associated to future license payments.
other long-term liabilities, respectively, associated to future license payments.

In addition to the above, and pursuant to the purchase agreements for certain acquisitions and other contractual
In addition to the above, and pursuant to the purchase agreements for certain acquisitions and other contractual
In addition to the above, and pursuant to the purchase agreements for certain acquisitions and other contractual
arrangements, we could be required to make additional contingent cash payments totaling up to $179.4 million
arrangements, we could be required to make additional contingent cash payments totaling up to $179.4 million
arrangements, we could be required to make additional contingent cash payments totaling up to $179.4 million
based on the achievement of certain revenue and operating results milestones as follows:
based on the achievement of certain revenue and operating results milestones as follows:
based on the achievement of certain revenue and operating results milestones as follows:

In addition to the above, and pursuant to the purchase agreements for certain acquisitions and other contractual
In addition to the above, and pursuant to the purchase agreements for certain acquisitions and other contractual
In addition to the above, and pursuant to the purchase agreements for certain acquisitions and other contractual
In addition to the above, and pursuant to the purchase agreements for certain acquisitions and other contractual
In addition to the above, and pursuant to the purchase agreements for certain acquisitions and other contractual
In addition to the above, and pursuant to the purchase agreements for certain acquisitions and other contractual
arrangements, we could be required to make additional contingent cash payments totaling up to $179.4 million
arrangements, we could be required to make additional contingent cash payments totaling up to $179.4 million
arrangements, we could be required to make additional contingent cash payments totaling up to $179.4 million
arrangements, we could be required to make additional contingent cash payments totaling up to $179.4 million
arrangements, we could be required to make additional contingent cash payments totaling up to $179.4 million
arrangements, we could be required to make additional contingent cash payments totaling up to $179.4 million
based on the achievement of certain revenue and operating results milestones as follows:
based on the achievement of certain revenue and operating results milestones as follows:
based on the achievement of certain revenue and operating results milestones as follows:
based on the achievement of certain revenue and operating results milestones as follows:
based on the achievement of certain revenue and operating results milestones as follows:
based on the achievement of certain revenue and operating results milestones as follows:

2020

2020
2020

2020
2020
2020
2020
2020

2020

2021

2021
2021

2021
2021
2021
2021
2021

2021

2022

2022
2022

2022
2022
2022
2022
2022

2022

2024

2024
2024

2024
2024
2024
2024
2024

2024

Anytime 12-month period from now until 2028

Anytime 12-month period from now until 2028
Anytime 12-month period from now until 2028

Anytime 12-month period from now until 2028
Anytime 12-month period from now until 2028
Anytime 12-month period from now until 2028
Anytime 12-month period from now until 2028
Anytime 12-month period from now until 2028

Anytime 12-month period from now until 2028

$ 152,750

$ 152,750
$ 152,750

$ 152,750
$ 152,750
$ 152,750
$ 152,750
$ 152,750

$ 152,750

11,800

11,800
11,800

11,800
11,800
11,800
11,800
11,800

11,800

5,900

5,900
5,900

5,900
5,900
5,900
5,900
5,900

5,900

5,900

5,900
5,900

5,900
5,900
5,900
5,900
5,900

5,900

300

300
300

300
300
300
300
300

300

$ 179,350

$ 179,350
$ 179,350

$ 179,350
$ 179,350
$ 179,350
$ 179,350
$ 179,350

$ 179,350

Of the $179.4 million total contingent obligation, we have assessed the fair value at December 31, 2019 to be
Of the $179.4 million total contingent obligation, we have assessed the fair value at December 31, 2019 to be
Of the $179.4 million total contingent obligation, we have assessed the fair value at December 31, 2019 to be
$162.2 million, of which $142.6 million is included in accrued and other current liabilities and $19.6 million is
$162.2 million, of which $142.6 million is included in accrued and other current liabilities and $19.6 million is
$162.2 million, of which $142.6 million is included in accrued and other current liabilities and $19.6 million is
included in other long-term liabilities in the accompanying consolidated balance sheet.
included in other long-term liabilities in the accompanying consolidated balance sheet.
included in other long-term liabilities in the accompanying consolidated balance sheet.

Of the $179.4 million total contingent obligation, we have assessed the fair value at December 31, 2019 to be
Of the $179.4 million total contingent obligation, we have assessed the fair value at December 31, 2019 to be
Of the $179.4 million total contingent obligation, we have assessed the fair value at December 31, 2019 to be
Of the $179.4 million total contingent obligation, we have assessed the fair value at December 31, 2019 to be
Of the $179.4 million total contingent obligation, we have assessed the fair value at December 31, 2019 to be
Of the $179.4 million total contingent obligation, we have assessed the fair value at December 31, 2019 to be
$162.2 million, of which $142.6 million is included in accrued and other current liabilities and $19.6 million is
$162.2 million, of which $142.6 million is included in accrued and other current liabilities and $19.6 million is
$162.2 million, of which $142.6 million is included in accrued and other current liabilities and $19.6 million is
$162.2 million, of which $142.6 million is included in accrued and other current liabilities and $19.6 million is
$162.2 million, of which $142.6 million is included in accrued and other current liabilities and $19.6 million is
$162.2 million, of which $142.6 million is included in accrued and other current liabilities and $19.6 million is
included in other long-term liabilities in the accompanying consolidated balance sheet.
included in other long-term liabilities in the accompanying consolidated balance sheet.
included in other long-term liabilities in the accompanying consolidated balance sheet.
included in other long-term liabilities in the accompanying consolidated balance sheet.
included in other long-term liabilities in the accompanying consolidated balance sheet.
included in other long-term liabilities in the accompanying consolidated balance sheet.

Liabilities associated with uncertain tax positions, including interest and penalties, are currently estimated at $60.6
Liabilities associated with uncertain tax positions, including interest and penalties, are currently estimated at $60.6
Liabilities associated with uncertain tax positions, including interest and penalties, are currently estimated at $60.6
Liabilities associated with uncertain tax positions, including interest and penalties, are currently estimated at $60.6
Liabilities associated with uncertain tax positions, including interest and penalties, are currently estimated at $60.6
Liabilities associated with uncertain tax positions, including interest and penalties, are currently estimated at $60.6
Liabilities associated with uncertain tax positions, including interest and penalties, are currently estimated at $60.6
Liabilities associated with uncertain tax positions, including interest and penalties, are currently estimated at $60.6
Liabilities associated with uncertain tax positions, including interest and penalties, are currently estimated at $60.6
million as of December 31, 2019 and are not included in the table above, as we cannot reasonably estimate when,
million as of December 31, 2019 and are not included in the table above, as we cannot reasonably estimate when,
million as of December 31, 2019 and are not included in the table above, as we cannot reasonably estimate when,
million as of December 31, 2019 and are not included in the table above, as we cannot reasonably estimate when,
million as of December 31, 2019 and are not included in the table above, as we cannot reasonably estimate when,
million as of December 31, 2019 and are not included in the table above, as we cannot reasonably estimate when,
million as of December 31, 2019 and are not included in the table above, as we cannot reasonably estimate when,
million as of December 31, 2019 and are not included in the table above, as we cannot reasonably estimate when,
million as of December 31, 2019 and are not included in the table above, as we cannot reasonably estimate when,
if ever, an amount would be paid to a government agency. Ultimate settlement of these liabilities is dependent on
if ever, an amount would be paid to a government agency. Ultimate settlement of these liabilities is dependent on
if ever, an amount would be paid to a government agency. Ultimate settlement of these liabilities is dependent on
if ever, an amount would be paid to a government agency. Ultimate settlement of these liabilities is dependent on
if ever, an amount would be paid to a government agency. Ultimate settlement of these liabilities is dependent on
if ever, an amount would be paid to a government agency. Ultimate settlement of these liabilities is dependent on
if ever, an amount would be paid to a government agency. Ultimate settlement of these liabilities is dependent on
if ever, an amount would be paid to a government agency. Ultimate settlement of these liabilities is dependent on
if ever, an amount would be paid to a government agency. Ultimate settlement of these liabilities is dependent on
factors outside of our control, such as examinations by each agency and expiration of statutes of limitation for
factors outside of our control, such as examinations by each agency and expiration of statutes of limitation for
factors outside of our control, such as examinations by each agency and expiration of statutes of limitation for
factors outside of our control, such as examinations by each agency and expiration of statutes of limitation for
factors outside of our control, such as examinations by each agency and expiration of statutes of limitation for
factors outside of our control, such as examinations by each agency and expiration of statutes of limitation for
factors outside of our control, such as examinations by each agency and expiration of statutes of limitation for
factors outside of our control, such as examinations by each agency and expiration of statutes of limitation for
factors outside of our control, such as examinations by each agency and expiration of statutes of limitation for
86
assessment of additional taxes.
assessment of additional taxes.
assessment of additional taxes.
assessment of additional taxes.
assessment of additional taxes.
assessment of additional taxes.
assessment of additional taxes.
assessment of additional taxes.
assessment of additional taxes.

Dividend

Dividend

Dividend

Dividend

Dividend

Dividend

Dividend

Dividend

Dividend

QIAGEN has not paid a cash dividend since its inception and does not intend to pay any dividends in the

QIAGEN has not paid a cash dividend since its inception and does not intend to pay any dividends in the

QIAGEN has not paid a cash dividend since its inception and does not intend to pay any dividends in the

QIAGEN has not paid a cash dividend since its inception and does not intend to pay any dividends in the

QIAGEN has not paid a cash dividend since its inception and does not intend to pay any dividends in the

QIAGEN has not paid a cash dividend since its inception and does not intend to pay any dividends in the

QIAGEN has not paid a cash dividend since its inception and does not intend to pay any dividends in the

QIAGEN has not paid a cash dividend since its inception and does not intend to pay any dividends in the

QIAGEN has not paid a cash dividend since its inception and does not intend to pay any dividends in the

foreseeable future. We intend to retain any earnings for the development of the business.

foreseeable future. We intend to retain any earnings for the development of the business.

foreseeable future. We intend to retain any earnings for the development of the business.

foreseeable future. We intend to retain any earnings for the development of the business.

foreseeable future. We intend to retain any earnings for the development of the business.

foreseeable future. We intend to retain any earnings for the development of the business.

foreseeable future. We intend to retain any earnings for the development of the business.

foreseeable future. We intend to retain any earnings for the development of the business.

foreseeable future. We intend to retain any earnings for the development of the business.

Credit Rating

Credit Rating

Credit Rating

Credit Rating

Credit Rating

Credit Rating

Credit Rating

Credit Rating

Credit Rating

QIAGEN is currently not rated by any credit rating agency.

QIAGEN is currently not rated by any credit rating agency.

QIAGEN is currently not rated by any credit rating agency.

QIAGEN is currently not rated by any credit rating agency.

QIAGEN is currently not rated by any credit rating agency.

QIAGEN is currently not rated by any credit rating agency.

QIAGEN is currently not rated by any credit rating agency.

QIAGEN is currently not rated by any credit rating agency.

QIAGEN is currently not rated by any credit rating agency.

Contractual Obligations(in thousands)Payments Due by PeriodTotal20202021202220232024ThereafterTotal contractual cash obligations(in thousands)Contingent Cash PaymentsContractual ObligationsContractual Obligations(in thousands)Payments Due by PeriodTotal20202021202220232024ThereafterTotal contractual cash obligations(in thousands)Contingent Cash PaymentsContractual Obligations(in thousands)Payments Due by PeriodTotal20202021202220232024ThereafterTotal contractual cash obligations(in thousands)Contingent Cash PaymentsContractual Obligations(in thousands)Payments Due by PeriodTotal20202021202220232024ThereafterTotal contractual cash obligations(in thousands)Contingent Cash PaymentsContractual Obligations(in thousands)Payments Due by PeriodTotal20202021202220232024ThereafterTotal contractual cash obligations(in thousands)Contingent Cash PaymentsContractual Obligations(in thousands)Payments Due by PeriodTotal20202021202220232024ThereafterTotal contractual cash obligations(in thousands)Contingent Cash PaymentsContractual Obligations(in thousands)Payments Due by PeriodTotal20202021202220232024ThereafterTotal contractual cash obligations(in thousands)Contingent Cash PaymentsContractual Obligations(in thousands)Payments Due by PeriodTotal20202021202220232024ThereafterTotal contractual cash obligations(in thousands)Contingent Cash PaymentsContractual Obligations(in thousands)Payments Due by PeriodTotal20202021202220232024ThereafterTotal contractual cash obligations(in thousands)Contingent Cash PaymentsLong-term debt(1)

Purchase obligations

Operating leases

$1,790,350

$25,438

$347,230

$491,356

$356,738

$552,636

$16,952

194,596

126,121

35,915

26,337

3,000

—

61,520

19,914

16,009

11,885

3,391

3,202

License and royalty payments (2)

37,455

11,434

9,012

6,507

1,823

4,297

3,223

7,119

4,382

$2,083,921

$182,907

$408,166

$536,085

$371,462

$560,850

$24,451

(1)  Amounts include required principal, stated at the current carrying values, and interest payments. Future 2020 contractual

cash obligations include only amounts due in cash. The 2021 Notes that became convertible pursuant to the indenture on

January 1, 2020 as further discussed in Note 16 "Lines of Credit and Debt" and are classified as current as of December 31,

2019, are only convertible during the triggered conversion period and are thus not included as a cash payment until the

2021 date in the table above.

(2)  As of December 31, 2019, $10.0 million and $14.5 million are included in accrued and other current liabilities and

other long-term liabilities, respectively, associated to future license payments.

In addition to the above, and pursuant to the purchase agreements for certain acquisitions and other contractual

arrangements, we could be required to make additional contingent cash payments totaling up to $179.4 million

based on the achievement of certain revenue and operating results milestones as follows:

2020

M A N A G E M E N T   R E P O R T

Performance Review

2021

2022

2024

Anytime 12-month period from now until 2028

$ 152,750

11,800

5,900

5,900

300

$ 179,350

Of the $179.4 million total contingent obligation, we have assessed the fair value at December 31, 2019 to be
$162.2 million, of which $142.6 million is included in accrued and other current liabilities and $19.6 million is
included in other long-term liabilities in the accompanying consolidated balance sheet.

Liabilities associated with uncertain tax positions, including interest and penalties, are currently estimated at $60.6
million as of December 31, 2019 and are not included in the table above, as we cannot reasonably estimate when,
if ever, an amount would be paid to a government agency. Ultimate settlement of these liabilities is dependent on
factors outside of our control, such as examinations by each agency and expiration of statutes of limitation for
assessment of additional taxes.

Dividend

QIAGEN has not paid a cash dividend since its inception and does not intend to pay any dividends in the
foreseeable future. We intend to retain any earnings for the development of the business.

Credit Rating

QIAGEN is currently not rated by any credit rating agency.

87

Contractual Obligations(in thousands)Payments Due by PeriodTotal20202021202220232024ThereafterTotal contractual cash obligations(in thousands)Contingent Cash PaymentsManagement Report
Management Report

Business and Operating Environment
Human Resources

QIAGEN is a global leader in Sample to Insight solutions that transform biological samples into valuable molecular
Overview
insights. Our mission is to enable customers across the continuum of molecular testing to unlock valuable insights
faster, better and more efficiently - from the raw biological sample to the final interpreted result.
The skills, knowledge, dedication and passion of our employees are critical for the success of QIAGEN. We want to
recruit, support and retain the best employees, offering performance-based remuneration, development opportunities
and measures to balance work and family life. We are committed to diversity in our teams, fueling innovation and
We serve more than 500,000 customers in two broad customer groups: Molecular Diagnostics (human healthcare)
engagement with our customers and business partners. In a fast-changing, competitive business environment,
and Life Sciences (academia, pharma R&D and industrial applications, primarily forensics). Proven QIAGEN
QIAGEN has a significant commitment to being an employer of choice and further enhancing our position as a great
solutions and content are providing answers in hospitals and laboratories worldwide, helping make sense of the
place to work. At the end of 2019, QIAGEN had 5,096 full-time equivalent employees, an increase of 3% from
increasing volumes and complexity of biological information, in keeping with our vision of making improvements in
4,952 at the end of 2018. Total personnel expenses including share-based compensation in 2019 were $484.7
life possible.
million compared to $483.6 million in 2018.

QIAGEN began operations in 1986 as a pioneer in the emerging biotechnology sector, introducing a novel method
Code of Ethics
that standardized and accelerated extraction and purification of nucleic acids from biological samples. As molecular
biology and genomic knowledge have grown to influence many areas of life, QIAGEN has expanded to serve the
QIAGEN has in place a Code of Conduct which qualifies as a code of ethics, as required by SEC and the New York
full spectrum of market needs. We believe our sample technologies are unmatched in quality for isolating and
Stock Exchange (NYSE) Listed Company Manual. The Code of Conduct applies to all of QIAGEN’s employees,
preparing DNA (deoxyribonucleic acid), RNA (ribonucleic acid) and proteins from blood or other liquids, tissue,
including our principal executive officer, principal financial officer, principal accounting officer or controller and
plants or other materials. Our assay technologies amplify, enrich and make these biomolecules accessible for
other persons performing similar functions. The full text of the Code of Conduct is available on our website at
analysis, such as identifying the genetic information of a pathogen or a gene mutation in a tumor. QIAGEN’s
www.QIAGEN.com.
industry-leading Digital Insights solutions allow users to analyze and interpret data with bioinformatics software and
knowledge bases to provide relevant, actionable insights. Our automation systems tie these technologies together in
seamless and cost-effective molecular testing workflows - from Sample to Insight.
Training and Retention

At QIAGEN, we recognize that employees are our most important resource. Their exceptional talent, skill, and
Net sales of $1.53 billion in 2019 consisted of consumable kits and other revenues (89% of sales) and automation
passion are key to our long-term success and corporate value. Employee development is therefore viewed as an
systems and instruments (11% of sales). Approximately 48% of net sales in 2019 were in Molecular Diagnostics, and
integral success factor in creating lasting value for our customers, patients, colleagues, partners, and shareholders.
52% in Life Sciences customer classes in the Academia / Applied Testing and Pharma markets.

QIAGEN maintains a transparent framework, the QIAGEN Profile Navigator (QPN), to make career paths, job
QIAGEN has grown by developing new instruments, consumables and digital solutions to meet diverse and growing
requirements and performance expectations clear based on objective criteria for all positions across our growing
needs in the market, partnering with researchers and Pharma companies, and acquiring companies or technologies
global organization. Our global Performance Enhancement System (PES) provides all employees and their managers
to complement our portfolio. We believe the addressable global market for QIAGEN's portfolio of molecular testing
with regular, one-on-one review sessions to discuss career development topics. PES sessions include discussion of an
products for customers across the continuum of life science research and molecular diagnostics totals more than $10
employee’s goals and achievements, training needs and interests, career planning drawing upon the QPN role
billion.
profile system, organizational development, and results of regular “180° surveys.” Professional training and
development are an ongoing process for all employees, tailored to different career paths. An employee’s pursuit of
We have funded our growth through internally generated funds, debt offerings, and private and public sales of
training cycles from PES session to training participation, review, follow-up, and back to PES review. QIAGEN’s
equity securities. QIAGEN’s global shares are listed on the New York Stock Exchange under the ticker symbol
compensation structure (see below) ties in with the QPN role profiles and PES performance evaluations.
QGEN and on the Frankfurt Prime Standard as QIA.

Management & Leadership Campus (MC & LC)
The company is registered under its commercial and legal name QIAGEN N.V. with the trade register (kamer van
koophandel) of the Dutch region Limburg Noord under file number 12036979. QIAGEN N.V. is a public limited
This program, composed of two components, is designed to ensure the ongoing development of QIAGEN’s future
liability company (naamloze vennootschap) under Dutch law as a holding company. Our principal executive office is
management generations. Management Campus prepares high-performing employees to take an initial leadership
located at Hulsterweg 82, 5912 PL Venlo, The Netherlands, and our telephone number is +31-77-355-6600.
position. The program provides management basics and an overview of relevant business management topics.
Leadership Campus accelerates the careers of our professionals by providing further insights into advanced
As a holding company, QIAGEN conducts business through subsidiaries located throughout the world. Further
leadership and management topics while focusing on individual development and business-related innovative
information about QIAGEN can be found at www.QIAGEN.com. By referring to our website, we do not incorporate
actions. It is a senior executive program that is designed to increase the leadership skills and management
the website or any portion of the website by reference into this Annual Report.
knowledge of outstanding QIAGEN senior managers by a more individual development approach. The program

88

Management Report

Human Resources

Overview

The skills, knowledge, dedication and passion of our employees are critical for the success of QIAGEN. We want to

recruit, support and retain the best employees, offering performance-based remuneration, development opportunities

and measures to balance work and family life. We are committed to diversity in our teams, fueling innovation and

engagement with our customers and business partners. In a fast-changing, competitive business environment,

QIAGEN has a significant commitment to being an employer of choice and further enhancing our position as a great

place to work. At the end of 2019, QIAGEN had 5,096 full-time equivalent employees, an increase of 3% from

4,952 at the end of 2018. Total personnel expenses including share-based compensation in 2019 were $484.7

million compared to $483.6 million in 2018.

QIAGEN has in place a Code of Conduct which qualifies as a code of ethics, as required by SEC and the New York

Stock Exchange (NYSE) Listed Company Manual. The Code of Conduct applies to all of QIAGEN’s employees,

including our principal executive officer, principal financial officer, principal accounting officer or controller and

other persons performing similar functions. The full text of the Code of Conduct is available on our website at

Code of Ethics

www.QIAGEN.com.

Training and Retention

At QIAGEN, we recognize that employees are our most important resource. Their exceptional talent, skill, and

passion are key to our long-term success and corporate value. Employee development is therefore viewed as an

integral success factor in creating lasting value for our customers, patients, colleagues, partners, and shareholders.

QIAGEN maintains a transparent framework, the QIAGEN Profile Navigator (QPN), to make career paths, job

requirements and performance expectations clear based on objective criteria for all positions across our growing
global organization. Our global Performance Enhancement System (PES) provides all employees and their managers
M A N A G E M E N T   R E P O R T Human Resources
with regular, one-on-one review sessions to discuss career development topics. PES sessions include discussion of an
employee’s goals and achievements, training needs and interests, career planning drawing upon the QPN role
profile system, organizational development, and results of regular “180° surveys.” Professional training and
development are an ongoing process for all employees, tailored to different career paths. An employee’s pursuit of
training cycles from PES session to training participation, review, follow-up, and back to PES review. QIAGEN’s
compensation structure (see below) ties in with the QPN role profiles and PES performance evaluations.

Management & Leadership Campus (MC & LC)

This program, composed of two components, is designed to ensure the ongoing development of QIAGEN’s future
management generations. Management Campus prepares high-performing employees to take an initial leadership
position. The program provides management basics and an overview of relevant business management topics.
Leadership Campus accelerates the careers of our professionals by providing further insights into advanced
leadership and management topics while focusing on individual development and business-related innovative
actions. It is a senior executive program that is designed to increase the leadership skills and management
knowledge of outstanding QIAGEN senior managers by a more individual development approach. The program
mainly focuses on change management and leadership coaching sessions, as well as on business-related innovative
actions.

Tuition Reimbursement / External Professional Programs

To support our future growth, QIAGEN managers are encouraged to support external training programs and courses
that their employees need to attend in order to prepare for new tasks or an expanded role. Employees can apply for
tuition reimbursement before they join an external program if the QIAGEN Academy does not offer a suitable
internal course option. Courses range from Business Administration for scientists to tailored training options for
specialists.

QIAGEN Academy

To support all QIAGEN employees in individual development, QIAGEN has an online learning management system
(LMS), the QIAGEN Academy. It manages the entire training process from enrollment to certificate conveniently in
one platform. The QIAGEN Academy is available to every employee 24/7 via the internet. Continual and flexible
access to all training materials at any time allows employees to blend different learning methods such as virtual
classrooms, web-based training, videos or classroom training into holistic and sustainable learning concepts. We
offer a huge training catalog with a wide range of development options aligned to QIAGEN’s competency model.
The training catalog is frequently reviewed with the commercial training team to align with trainings offered in the
areas of sales and products.

For more information about our training system, please also refer to the section “Employee matters” in our non-
financial statement included in this report.

Compensation System

Since the creation of QIAGEN, management has formed a culture that seeks to attract and retain the best talent
worldwide and reward associates for performance. This compensation system fosters a focus on achieving corporate
strategic initiatives as well as personal accountability.

It is critical for QIAGEN to offer attractive compensation packages on a global basis. According to the QIAGEN
philosophy, an employee who achieves his or her performance objectives should generally be awarded
compensation comparable to the median levels of compensation provided by relevant benchmark companies.
QIAGEN participates in various compensation benchmarking surveys that provide information on the level and mix
of compensation awarded by various companies and industries for a broad range of positions around the world. In
the case of QIAGEN, these include many peer life science and diagnostics companies based in the U.S.

QIAGEN has a “pay for performance” culture, with the compensation of employees linked to the achievement of
corporate financial and individual performance goals. Business goals are established by senior management. These
goals are set at ambitious levels each year to motivate and drive performance, with a focus on both short-term and
long-term quantifiable objectives. Performance metrics used for these goals include the achievement of targets for net
sales, adjusted operating income and free cash flow. In 2019, the payments for short-term variable compensation
were based on 90% achievement of the business goals. Compensation for a significant majority of employees
89
worldwide includes fixed base compensation and benefits, which vary according to local market customs, as well as
a short-term variable cash bonus. The level of fixed compensation is paid in cash, usually on a monthly basis, and is

designed to provide the employee with a reasonable standard of living relative to the compensation offered by peer

companies. The amount of short-term variable cash bonus is designed to reward performance, with the payout

amount based on the achievement of overall corporate financial results as well as individual performance against a

written set of objectives.

For the Interim Chief Executive Officer, the target annual short-term variable cash bonus is set at 100% of the annual

base salary and the maximum is equivalent to 175% of the annual base salary. The Chief Financial Officer has a

target annual short-term variable cash bonus set at 48% with the maximum being equivalent to 74% of the annual

fixed salary. Furthermore, to align our compensation programs with the interests of shareholders, senior executives

mainly focuses on change management and leadership coaching sessions, as well as on business-related innovative

actions.

Tuition Reimbursement / External Professional Programs

To support our future growth, QIAGEN managers are encouraged to support external training programs and courses

that their employees need to attend in order to prepare for new tasks or an expanded role. Employees can apply for

tuition reimbursement before they join an external program if the QIAGEN Academy does not offer a suitable

internal course option. Courses range from Business Administration for scientists to tailored training options for

specialists.

QIAGEN Academy

To support all QIAGEN employees in individual development, QIAGEN has an online learning management system

(LMS), the QIAGEN Academy. It manages the entire training process from enrollment to certificate conveniently in

one platform. The QIAGEN Academy is available to every employee 24/7 via the internet. Continual and flexible

access to all training materials at any time allows employees to blend different learning methods such as virtual

classrooms, web-based training, videos or classroom training into holistic and sustainable learning concepts. We

offer a huge training catalog with a wide range of development options aligned to QIAGEN’s competency model.

The training catalog is frequently reviewed with the commercial training team to align with trainings offered in the

areas of sales and products.

For more information about our training system, please also refer to the section “Employee matters” in our non-

financial statement included in this report.

Compensation System

Since the creation of QIAGEN, management has formed a culture that seeks to attract and retain the best talent

worldwide and reward associates for performance. This compensation system fosters a focus on achieving corporate

strategic initiatives as well as personal accountability.

It is critical for QIAGEN to offer attractive compensation packages on a global basis. According to the QIAGEN
philosophy, an employee who achieves his or her performance objectives should generally be awarded
compensation comparable to the median levels of compensation provided by relevant benchmark companies.
QIAGEN participates in various compensation benchmarking surveys that provide information on the level and mix
of compensation awarded by various companies and industries for a broad range of positions around the world. In
the case of QIAGEN, these include many peer life science and diagnostics companies based in the U.S.

QIAGEN has a “pay for performance” culture, with the compensation of employees linked to the achievement of
corporate financial and individual performance goals. Business goals are established by senior management. These
goals are set at ambitious levels each year to motivate and drive performance, with a focus on both short-term and
long-term quantifiable objectives. Performance metrics used for these goals include the achievement of targets for net
sales, adjusted operating income and free cash flow. In 2019, the payments for short-term variable compensation
were based on 90% achievement of the business goals. Compensation for a significant majority of employees
worldwide includes fixed base compensation and benefits, which vary according to local market customs, as well as
a short-term variable cash bonus. The level of fixed compensation is paid in cash, usually on a monthly basis, and is
designed to provide the employee with a reasonable standard of living relative to the compensation offered by peer
companies. The amount of short-term variable cash bonus is designed to reward performance, with the payout
amount based on the achievement of overall corporate financial results as well as individual performance against a
written set of objectives.

For the Interim Chief Executive Officer, the target annual short-term variable cash bonus is set at 100% of the annual
base salary and the maximum is equivalent to 175% of the annual base salary. The Chief Financial Officer has a
target annual short-term variable cash bonus set at 48% with the maximum being equivalent to 74% of the annual
fixed salary. Furthermore, to align our compensation programs with the interests of shareholders, senior executives
receive a portion of their total compensation in the form of long-term compensation, which is granted as equity as a
reward for performance. These grants are determined on an individual basis and approved by the Compensation
Committee. These equity grants are made in the form of Performance Stock Units (PSUs) with a staggered vesting
period typically over three (40%) and five years (60%) .

For enhanced Work-Life Balance, QIAGEN offers services to help employees balance their personal life with our
dynamic and driven work environment, including in-house corporate childcare and sabbatical programs, as well as
company-sponsored fitness and health facilities, and programs. Flexible working hours apply to all employees except
for functions that require critical on-time presence.

Workplace Health

In today’s business climate, the health of employees is often directly related to the health of the company. Increased
job satisfaction, improved morale, reduced injuries, and increased productivity are just some of the benefits which a
healthy work environment can have. At its headquarters, QIAGEN regularly offers “health days” where all
employees are invited to receive free counsel and to participate in screening and nutrition programs, medical check-
ups, etc. At its major locations, QIAGEN provides in-house gyms open to all employees. All female employees have
free access to screening for HPV, the primary cause of cervical cancer.

Employees worldwide

Americas

EMEA

APAC & RoW

2017

Production

R&D

Sales

Marketing

90

Admin

1245

2567

876

4688

1230

2670

1052

4952

2018

2019

23%

Production

22%

Production

20%

R&D

40%

Sales

6%

Marketing

11%

Admin

21%

R&D

40%

Sales

6%

Marketing

11%

Admin

1132

2820

1144

5096

23%

19%

40%

6%

12%

201720182019Totalreceive a portion of their total compensation in the form of long-term compensation, which is granted as equity as a

receive a portion of their total compensation in the form of long-term compensation, which is granted as equity as a

reward for performance. These grants are determined on an individual basis and approved by the Compensation

reward for performance. These grants are determined on an individual basis and approved by the Compensation

Committee. These equity grants are made in the form of Performance Stock Units (PSUs) with a staggered vesting

Committee. These equity grants are made in the form of Performance Stock Units (PSUs) with a staggered vesting

period typically over three (40%) and five years (60%) .

period typically over three (40%) and five years (60%) .

For enhanced Work-Life Balance, QIAGEN offers services to help employees balance their personal life with our

For enhanced Work-Life Balance, QIAGEN offers services to help employees balance their personal life with our

dynamic and driven work environment, including in-house corporate childcare and sabbatical programs, as well as

dynamic and driven work environment, including in-house corporate childcare and sabbatical programs, as well as

company-sponsored fitness and health facilities, and programs. Flexible working hours apply to all employees except

company-sponsored fitness and health facilities, and programs. Flexible working hours apply to all employees except

for functions that require critical on-time presence.

for functions that require critical on-time presence.

Workplace Health

Workplace Health
M A N A G E M E N T   R E P O R T Human Resources
In today’s business climate, the health of employees is often directly related to the health of the company. Increased
job satisfaction, improved morale, reduced injuries, and increased productivity are just some of the benefits which a
healthy work environment can have. At its headquarters, QIAGEN regularly offers “health days” where all
employees are invited to receive free counsel and to participate in screening and nutrition programs, medical check-
ups, etc. At its major locations, QIAGEN provides in-house gyms open to all employees. All female employees have
receive a portion of their total compensation in the form of long-term compensation, which is granted as equity as a
free access to screening for HPV, the primary cause of cervical cancer.
reward for performance. These grants are determined on an individual basis and approved by the Compensation
Committee. These equity grants are made in the form of Performance Stock Units (PSUs) with a staggered vesting
Employees worldwide
period typically over three (40%) and five years (60%) .

In today’s business climate, the health of employees is often directly related to the health of the company. Increased
job satisfaction, improved morale, reduced injuries, and increased productivity are just some of the benefits which a
healthy work environment can have. At its headquarters, QIAGEN regularly offers “health days” where all
employees are invited to receive free counsel and to participate in screening and nutrition programs, medical check-
ups, etc. At its major locations, QIAGEN provides in-house gyms open to all employees. All female employees have
free access to screening for HPV, the primary cause of cervical cancer.

Employees worldwide

Americas

For enhanced Work-Life Balance, QIAGEN offers services to help employees balance their personal life with our
dynamic and driven work environment, including in-house corporate childcare and sabbatical programs, as well as
1132
company-sponsored fitness and health facilities, and programs. Flexible working hours apply to all employees except
2820
for functions that require critical on-time presence.
APAC & RoW

APAC & RoW

Americas

EMEA

EMEA

1245

1230

2670

1052

1144

2567

2567

1245

876

876

Workplace Health

4688

4952

4688

5096

Production

2017

2018

2017
In today’s business climate, the health of employees is often directly related to the health of the company. Increased
job satisfaction, improved morale, reduced injuries, and increased productivity are just some of the benefits which a
healthy work environment can have. At its headquarters, QIAGEN regularly offers “health days” where all
23%
employees are invited to receive free counsel and to participate in screening and nutrition programs, medical check-
19%
21%
ups, etc. At its major locations, QIAGEN provides in-house gyms open to all employees. All female employees have
40%
40%
40%
free access to screening for HPV, the primary cause of cervical cancer.
6%

2018

2019

Production

Production

Production

Production

Marketing

Marketing

Marketing

Marketing

Marketing

Sales

Sales

Sales

Sales

Sales

R&D

R&D

R&D

R&D

R&D

20%

23%

22%

21%

40%

20%

23%

40%

22%

6%

6%

6%

6%

2019

Production

R&D

Sales

Marketing

Employees worldwide
Admin

11%

Admin

Admin

11%

11%

Admin

Admin

11%

12%

Admin

Americas

EMEA

APAC & RoW

2017

Production

R&D

Sales

Marketing

Admin

1245

2567

876

4688

1230

2670

1052

4952

2018

2019

23%

Production

22%

Production

20%

R&D

40%

Sales

6%

Marketing

11%

Admin

21%

R&D

40%

Sales

6%

Marketing

11%

Admin

1132

2820

1144

5096

23%

19%

40%

6%

12%

91

1230

2670

1052

4952

1132

2820

1144

5096

23%

19%

40%

6%

12%

201720182019Total23%20%40%6%2%11%22%21%40%6%2%11%23%19%40%6%2%12%20%40%6%ProductionR&DSalesMarketingAdminProductionR&DSalesMarketingAdmin21%40%6%ProductionR&DSalesMarketingAdmin19%40%6%201720182019Total1,1441,13201000200030004000600050002019AmericasEMEAAPAC & RoW2,8208761,0521,2451,230201820172,6702,567201720182019TotalManagement Report
Management Report

Business and Operating Environment
Non-Financial Statement

QIAGEN is a global leader in Sample to Insight solutions that transform biological samples into valuable molecular
Our Approach to Sustainability
insights. Our mission is to enable customers across the continuum of molecular testing to unlock valuable insights
faster, better and more efficiently - from the raw biological sample to the final interpreted result.
For QIAGEN, sustainability means long-term economic success combined with respect for the natural environment
and healthy, high-performance workplaces, with the aim to make improvements in life possible as a good corporate
citizen.
We serve more than 500,000 customers in two broad customer groups: Molecular Diagnostics (human healthcare)
and Life Sciences (academia, pharma R&D and industrial applications, primarily forensics). Proven QIAGEN
solutions and content are providing answers in hospitals and laboratories worldwide, helping make sense of the
Our commitment to sustainability goes beyond formal regulations. As a market and innovation leader in life sciences
increasing volumes and complexity of biological information, in keeping with our vision of making improvements in
and molecular diagnostics, we believe there is room for innovation in driving sustainable development in our
life possible.
industry, and we are resolved to continue moving forward.

QIAGEN began operations in 1986 as a pioneer in the emerging biotechnology sector, introducing a novel method
In order to continuously address, monitor, and manage sustainability topics, QIAGEN has implemented a global
that standardized and accelerated extraction and purification of nucleic acids from biological samples. As molecular
function within our operations structure in 2019. This function will head QIAGEN’s global environmental, health and
biology and genomic knowledge have grown to influence many areas of life, QIAGEN has expanded to serve the
security topics. This position has responsibility and oversight for sustainability at QIAGEN and reports to the Head of
full spectrum of market needs. We believe our sample technologies are unmatched in quality for isolating and
Global Operations, which is part of QIAGEN’s Executive Board.
preparing DNA (deoxyribonucleic acid), RNA (ribonucleic acid) and proteins from blood or other liquids, tissue,
plants or other materials. Our assay technologies amplify, enrich and make these biomolecules accessible for
We pledge to continually evaluate the potential environmental impact of our business, saving energy and reducing
analysis, such as identifying the genetic information of a pathogen or a gene mutation in a tumor. QIAGEN’s
negative environmental impacts of our operations. We look after the welfare of our employees, taking care of their
industry-leading Digital Insights solutions allow users to analyze and interpret data with bioinformatics software and
developmental needs and supporting them in every way to become and remain committed and responsible. We
knowledge bases to provide relevant, actionable insights. Our automation systems tie these technologies together in
extend our commitment to sustainability into the supply chain, committing our business partners to sign up to our
seamless and cost-effective molecular testing workflows - from Sample to Insight.
environmental, social and human-rights related standards.

Net sales of $1.53 billion in 2019 consisted of consumable kits and other revenues (89% of sales) and automation
We recognize that ongoing success for QIAGEN also depends on the sustainability of society’s resources. This is
systems and instruments (11% of sales). Approximately 48% of net sales in 2019 were in Molecular Diagnostics, and
why we engage in dialogue with our various stakeholders – employees, customers, patients, suppliers, shareholders,
52% in Life Sciences customer classes in the Academia / Applied Testing and Pharma markets.
non-governmental organizations (NGOs) and communities – to gain a better understanding of our operating
environment, including market developments and cultural dynamics through approaches ranging from standard
QIAGEN has grown by developing new instruments, consumables and digital solutions to meet diverse and growing
questionnaires to one-on-one conversations. Our employee-led volunteer sustainability committees drive progress by
needs in the market, partnering with researchers and Pharma companies, and acquiring companies or technologies
identifying areas for environmental improvement at all levels of the company, initiating projects, and providing input
to complement our portfolio. We believe the addressable global market for QIAGEN's portfolio of molecular testing
on environmental topics.
products for customers across the continuum of life science research and molecular diagnostics totals more than $10
billion.
Please find information about our business model, organizational structure, products, customers, business strategy, as
well as main trends and issues pertaining to the reporting year, in our Management Report.
We have funded our growth through internally generated funds, debt offerings, and private and public sales of
equity securities. QIAGEN’s global shares are listed on the New York Stock Exchange under the ticker symbol
QGEN and on the Frankfurt Prime Standard as QIA.

For guidance on materiality and non-financial disclosure, we base our non-financial reporting on the Sustainability
Reporting Standards (SRS) of the Global Reporting Initiative (GRI) Standards 2016 as well as on relevant
The company is registered under its commercial and legal name QIAGEN N.V. with the trade register (kamer van
sustainability accounting standards as issued by the Sustainability Accounting Standards Board (SASB).
koophandel) of the Dutch region Limburg Noord under file number 12036979. QIAGEN N.V. is a public limited
liability company (naamloze vennootschap) under Dutch law as a holding company. Our principal executive office is
located at Hulsterweg 82, 5912 PL Venlo, The Netherlands, and our telephone number is +31-77-355-6600.
In the reporting period, we reviewed the materiality analysis first conducted in 2017. As a first step, a long list of
potentially relevant topics was drawn up, based on relevant sustainability frameworks, rating requirements and a
competitive analysis. The five non-financial aspects prescribed in the European Commission’s CSR Directive
As a holding company, QIAGEN conducts business through subsidiaries located throughout the world. Further
2014/95/EU (environmental, social and employee matters, respect for human rights, anti-corruption and bribery)
information about QIAGEN can be found at www.QIAGEN.com. By referring to our website, we do not incorporate
were also taken into account. In a second step, the topics were consolidated into a list of 17 topics and evaluated in
the website or any portion of the website by reference into this Annual Report.
an online survey of QIAGEN representatives with regard to their business relevance and their impact on the non-

92

Material non-financial informationManagement Report

Non-Financial Statement

Our Approach to Sustainability

For QIAGEN, sustainability means long-term economic success combined with respect for the natural environment

and healthy, high-performance workplaces, with the aim to make improvements in life possible as a good corporate

citizen.

Our commitment to sustainability goes beyond formal regulations. As a market and innovation leader in life sciences

and molecular diagnostics, we believe there is room for innovation in driving sustainable development in our

industry, and we are resolved to continue moving forward.

In order to continuously address, monitor, and manage sustainability topics, QIAGEN has implemented a global

function within our operations structure in 2019. This function will head QIAGEN’s global environmental, health and

security topics. This position has responsibility and oversight for sustainability at QIAGEN and reports to the Head of

Global Operations, which is part of QIAGEN’s Executive Board.

We pledge to continually evaluate the potential environmental impact of our business, saving energy and reducing

negative environmental impacts of our operations. We look after the welfare of our employees, taking care of their

developmental needs and supporting them in every way to become and remain committed and responsible. We

extend our commitment to sustainability into the supply chain, committing our business partners to sign up to our

environmental, social and human-rights related standards.

We recognize that ongoing success for QIAGEN also depends on the sustainability of society’s resources. This is

why we engage in dialogue with our various stakeholders – employees, customers, patients, suppliers, shareholders,

non-governmental organizations (NGOs) and communities – to gain a better understanding of our operating

environment, including market developments and cultural dynamics through approaches ranging from standard

questionnaires to one-on-one conversations. Our employee-led volunteer sustainability committees drive progress by

identifying areas for environmental improvement at all levels of the company, initiating projects, and providing input

on environmental topics.

Please find information about our business model, organizational structure, products, customers, business strategy, as
well as main trends and issues pertaining to the reporting year, in our Management Report.
M A N A G E M E N T   R E P O R T Non-Financial Statement

For guidance on materiality and non-financial disclosure, we base our non-financial reporting on the Sustainability
Reporting Standards (SRS) of the Global Reporting Initiative (GRI) Standards 2016 as well as on relevant
sustainability accounting standards as issued by the Sustainability Accounting Standards Board (SASB).

In the reporting period, we reviewed the materiality analysis first conducted in 2017. As a first step, a long list of
potentially relevant topics was drawn up, based on relevant sustainability frameworks, rating requirements and a
competitive analysis. The five non-financial aspects prescribed in the European Commission’s CSR Directive
2014/95/EU (environmental, social and employee matters, respect for human rights, anti-corruption and bribery)
were also taken into account. In a second step, the topics were consolidated into a list of 17 topics and evaluated in
an online survey of QIAGEN representatives with regard to their business relevance and their impact on the non-
financial aspects. In a joint workshop with representatives from our different departments, the results of the survey
were discussed and the various perspectives assessed. The final materiality matrix was validated by our senior
management and resulted in the following material topics:

›

Environmental matters: energy and emissions, water consumption, resource efficiency, sustainable procurement

›

Employee matters: employee satisfaction, occupational safety and health protection, employee development,
responsible employer, equal opportunities

›

Social matters: access to healthcare, quality and product safety, customer satisfaction, data and cyber security

›

Respect for human rights: conflict minerals

›

Anti-corruption and bribery matters: antitrust, anti-corruption

Environment

At QIAGEN, we aim to save energy and reduce the environmental impact of our operations by driving long-term
economic success with healthy, high performance workplaces and make improvements in life possible as a good
corporate citizen. Reducing our environmental impact is a key corporate goal for 2020 and beyond that all
employees are actively engaged in working towards.

As an international pioneer in our industry when it comes to eliminating harmful substances and waste products in
laboratories, we have seen the value of environmentally responsible solutions as a source of competitive advantage,
as well as an act of corporate citizenship.

To support this commitment a new Global Environment, Health and Safety (EHS) function was initiated in 2019 to
drive the implementation of international environmental management systems in our production and research and
development facilitates, to set goals and objectives to set limits to reduce the consumption of energy and water and
to reduce the amount of plastic used in our packaging, during transportation. With these efforts, we aim to operate
in the most cost-efficient and environmentally friendly way possible.

QIAGEN recognizes risks resulting from climate change such as extreme weather events, changes in regulation or
customer behavior. Operations could for example be negatively impacted by volatility in the cost of raw materials,
components, freight and energy. New laws or regulations adopted in response to climate change could increase
energy costs, the costs of certain raw materials, components, packaging and transportation.

To proactively minimize our contribution to climate change, QIAGEN has committed to reducing emissions in line
with a 1.5 degree Celsius climate target. Our 2019 carbon footprint, which was calculated with market-based
emissions factors, will serve as the base year. By the year 2022, QIAGEN will reduce scope 1 and 2 emissions by
12.6% and business travel emissions by 3.7% below the base year. QIAGEN will achieve these reductions by
establishing an energy efficiency task force that will identify areas for energy efficiency across the company and
through purchasing green energy attributed certificates and high-quality carbon credits.

To increase transparency regarding our own global energy consumption and greenhouse gas emissions, QIAGEN
has extended the coverage of the energy consumption data by the integration of a centralized data collection
process management for all production sites, research centers and major offices.

93

The expansion in the collection of our energy data enabled us to calculate our corporate carbon footprint (CCF) for

scope 1, 2 and 3 emissions more accurately in the reporting year and report it following a location-based and

market-based approach for our scope 2 emissions. Scope 1 covers direct greenhouse gas emissions (GHG

emissions) from combustion of fossil fuels on our own premises; scope 2 are indirect emissions originating from

external generation of electricity for our operations. A location-based calculation method for scope 2 emissions

reflects the average emissions intensity of grids on which energy consumption occurs; a market-based method reflects

emissions calculated with the particular energy source mix used by each QIAGEN site.

Material non-financial informationEnvironmental Performancefinancial aspects. In a joint workshop with representatives from our different departments, the results of the survey

were discussed and the various perspectives assessed. The final materiality matrix was validated by our senior

management and resulted in the following material topics:

›

Environmental matters: energy and emissions, water consumption, resource efficiency, sustainable procurement

›

Employee matters: employee satisfaction, occupational safety and health protection, employee development,

responsible employer, equal opportunities

›

Social matters: access to healthcare, quality and product safety, customer satisfaction, data and cyber security

›

Respect for human rights: conflict minerals

›

Anti-corruption and bribery matters: antitrust, anti-corruption

Environment

At QIAGEN, we aim to save energy and reduce the environmental impact of our operations by driving long-term

economic success with healthy, high performance workplaces and make improvements in life possible as a good

corporate citizen. Reducing our environmental impact is a key corporate goal for 2020 and beyond that all

employees are actively engaged in working towards.

As an international pioneer in our industry when it comes to eliminating harmful substances and waste products in

laboratories, we have seen the value of environmentally responsible solutions as a source of competitive advantage,

as well as an act of corporate citizenship.

To support this commitment a new Global Environment, Health and Safety (EHS) function was initiated in 2019 to

drive the implementation of international environmental management systems in our production and research and

development facilitates, to set goals and objectives to set limits to reduce the consumption of energy and water and

to reduce the amount of plastic used in our packaging, during transportation. With these efforts, we aim to operate

in the most cost-efficient and environmentally friendly way possible.

QIAGEN recognizes risks resulting from climate change such as extreme weather events, changes in regulation or

customer behavior. Operations could for example be negatively impacted by volatility in the cost of raw materials,

components, freight and energy. New laws or regulations adopted in response to climate change could increase

energy costs, the costs of certain raw materials, components, packaging and transportation.

To proactively minimize our contribution to climate change, QIAGEN has committed to reducing emissions in line
with a 1.5 degree Celsius climate target. Our 2019 carbon footprint, which was calculated with market-based
emissions factors, will serve as the base year. By the year 2022, QIAGEN will reduce scope 1 and 2 emissions by
12.6% and business travel emissions by 3.7% below the base year. QIAGEN will achieve these reductions by
establishing an energy efficiency task force that will identify areas for energy efficiency across the company and
through purchasing green energy attributed certificates and high-quality carbon credits.

To increase transparency regarding our own global energy consumption and greenhouse gas emissions, QIAGEN
has extended the coverage of the energy consumption data by the integration of a centralized data collection
process management for all production sites, research centers and major offices.

The expansion in the collection of our energy data enabled us to calculate our corporate carbon footprint (CCF) for
scope 1, 2 and 3 emissions more accurately in the reporting year and report it following a location-based and
market-based approach for our scope 2 emissions. Scope 1 covers direct greenhouse gas emissions (GHG
emissions) from combustion of fossil fuels on our own premises; scope 2 are indirect emissions originating from
external generation of electricity for our operations. A location-based calculation method for scope 2 emissions
reflects the average emissions intensity of grids on which energy consumption occurs; a market-based method reflects
emissions calculated with the particular energy source mix used by each QIAGEN site.

As of 2018, all relevant scope 1 and 2 emissions are included following a location-based approach. The additional
As of 2018, all relevant scope 1 and 2 emissions are included following a location-based approach. The additional
As of 2018, all relevant scope 1 and 2 emissions are included following a location-based approach. The additional
As of 2018, all relevant scope 1 and 2 emissions are included following a location-based approach. The additional
As of 2018, all relevant scope 1 and 2 emissions are included following a location-based approach. The additional
calculation using a market-based approach for scope 2 emissions was introduced for 2019 as part of our climate
calculation using a market-based approach for scope 2 emissions was introduced for 2019 as part of our climate
calculation using a market-based approach for scope 2 emissions was introduced for 2019 as part of our climate
calculation using a market-based approach for scope 2 emissions was introduced for 2019 as part of our climate
calculation using a market-based approach for scope 2 emissions was introduced for 2019 as part of our climate
strategy. Accordingly, we will report our KPIs for GHG emissions using the market-based approach from next
strategy. Accordingly, we will report our KPIs for GHG emissions using the market-based approach from next
strategy. Accordingly, we will report our KPIs for GHG emissions using the market-based approach from next
strategy. Accordingly, we will report our KPIs for GHG emissions using the market-based approach from next
strategy. Accordingly, we will report our KPIs for GHG emissions using the market-based approach from next
reporting year on. In addition, we have started to collect data for calculating GHG emissions in scope 3. These
reporting year on. In addition, we have started to collect data for calculating GHG emissions in scope 3. These
reporting year on. In addition, we have started to collect data for calculating GHG emissions in scope 3. These
reporting year on. In addition, we have started to collect data for calculating GHG emissions in scope 3. These
reporting year on. In addition, we have started to collect data for calculating GHG emissions in scope 3. These
emissions occur along our value chain, for example through transport services, suppliers or the use of our products.
emissions occur along our value chain, for example through transport services, suppliers or the use of our products.
emissions occur along our value chain, for example through transport services, suppliers or the use of our products.
emissions occur along our value chain, for example through transport services, suppliers or the use of our products.
emissions occur along our value chain, for example through transport services, suppliers or the use of our products.
As a first Scope 3 category, we have integrated emissions resulting from business travel into our CCF for 2019.
As a first Scope 3 category, we have integrated emissions resulting from business travel into our CCF for 2019.
As a first Scope 3 category, we have integrated emissions resulting from business travel into our CCF for 2019.
As a first Scope 3 category, we have integrated emissions resulting from business travel into our CCF for 2019.
As a first Scope 3 category, we have integrated emissions resulting from business travel into our CCF for 2019.

In addition to our energy and climate management activities, we collect data regarding fresh water consumption and
In addition to our energy and climate management activities, we collect data regarding fresh water consumption and
In addition to our energy and climate management activities, we collect data regarding fresh water consumption and
In addition to our energy and climate management activities, we collect data regarding fresh water consumption and
In addition to our energy and climate management activities, we collect data regarding fresh water consumption and
waste for all our production sites. The table below lists figures from 2019 and 2018, and expresses our consolidated
waste for all our production sites. The table below lists figures from 2019 and 2018, and expresses our consolidated
waste for all our production sites. The table below lists figures from 2019 and 2018, and expresses our consolidated
waste for all our production sites. The table below lists figures from 2019 and 2018, and expresses our consolidated
waste for all our production sites. The table below lists figures from 2019 and 2018, and expresses our consolidated
environmental data in relation to our production volume sold to establish a basis for a long-term monitoring system.
environmental data in relation to our production volume sold to establish a basis for a long-term monitoring system.
environmental data in relation to our production volume sold to establish a basis for a long-term monitoring system.
environmental data in relation to our production volume sold to establish a basis for a long-term monitoring system.
environmental data in relation to our production volume sold to establish a basis for a long-term monitoring system.

Energy
Energy
(in MWh)
(in MWh)

Energy
Energy
Energy
(in MWh)
(in MWh)
(in MWh)

GHG emissions Scope 1 +
GHG emissions Scope 1 +
2
2
(in tCO2 ; location-based)
(in tCO2; location-based)

GHG emissions Scope 1 +
2
(in tCO2; location-based)

GHG emissions Scope 1 +
GHG emissions Scope 1 +
2
2
(in tCO2; location-based)
(in tCO2; location-based)

Freshwater use (in m3 )
Freshwater use (in m3 )

Freshwater use (in m3 )

Freshwater use (in m3 )
Freshwater use (in m3 )

Total waste (in t)
Total waste (in t)

Total waste (in t)

Total waste (in t)
Total waste (in t)

Hazardous waste (in t)
Hazardous waste (in t)

Hazardous waste (in t)

Hazardous waste (in t)
Hazardous waste (in t)

86,158
86,158

86,158

86,158
86,158

0.0188
0.0188

0.0188

0.0188
0.0188

MWh/unit
MWh/unit

MWh/unit

MWh/unit
MWh/unit

29,347
29,347

29,347

29,347
29,347

474,335
474,335

474,335

474,335
474,335

1,155
1,155

1,155

1,155
1,155

330
330

330

330
330

6,429
6,429

6,429

6,429
6,429

g/unit
g/unit

g/unit

g/unit
g/unit

104
104

104

104
104

253
253

253

253
253

72.3
72.3

72.3

72.3
72.3

l/unit
l/unit

l/unit

l/unit
l/unit

g/unit
g/unit

g/unit

g/unit
g/unit

g/unit
g/unit

g/unit

g/unit
g/unit

86,5492
86,5492

86,5492

86,5492
86,5492

28,8982
28,8982

28,8982

28,8982
28,8982

0.0248
0.0248

0.0248

0.0248
0.0248

MWh/unit
MWh/unit

MWh/unit

MWh/unit
MWh/unit

8,294
8,294

8,294

8,294
8,294

g/unit
g/unit

g/unit

g/unit
g/unit

119,621
119,621

119,621

119,621
119,621

34
34

34

34
34

l/unit
l/unit

l/unit

l/unit
l/unit

633
633

633

633
633

182
182

182

182
182

250
250

250

250
250

71.7
71.7

71.7

71.7
71.7

g/unit
g/unit

g/unit

g/unit
g/unit

g/unit
g/unit

g/unit

g/unit
g/unit

(1) Extension of the scope in 2019: All sites reported energy and emissions data. 25 sites reported water consumption data. 
(1) Extension of the scope in 2019: All sites reported energy and emissions data. 25 sites reported water consumption data. 
(2) Figures for 2018 were adjusted due to improved data availability.
(2) Figures for 2018 were adjusted due to improved data availability.

(1) Extension of the scope in 2019: All sites reported energy and emissions data. 25 sites reported water consumption data. 
(2) Figures for 2018 were adjusted due to improved data availability.

(1) Extension of the scope in 2019: All sites reported energy and emissions data. 25 sites reported water consumption data. 
(1) Extension of the scope in 2019: All sites reported energy and emissions data. 25 sites reported water consumption data. 
(2) Figures for 2018 were adjusted due to improved data availability.
(2) Figures for 2018 were adjusted due to improved data availability.

Our global data collection coverage of energy and emissions was increased from 30% in 2017 to 100 % in 2019.
Our global data collection coverage of energy and emissions was increased from 30% in 2017 to 100 % in 2019.
Our global data collection coverage of energy and emissions was increased from 30% in 2017 to 100 % in 2019.
Our global data collection coverage of energy and emissions was increased from 30% in 2017 to 100 % in 2019.
Our global data collection coverage of energy and emissions was increased from 30% in 2017 to 100 % in 2019.
In 2019, we achieved a decrease of 0.3 GWh in our total energy consumption to 86.2 GWh compared to 86.5
In 2019, we achieved a decrease of 0.3 GWh in our total energy consumption to 86.2 GWh compared to 86.5
In 2019, we achieved a decrease of 0.3 GWh in our total energy consumption to 86.2 GWh compared to 86.5
In 2019, we achieved a decrease of 0.3 GWh in our total energy consumption to 86.2 GWh compared to 86.5
In 2019, we achieved a decrease of 0.3 GWh in our total energy consumption to 86.2 GWh compared to 86.5
GWh in 2018 as detailed in the table below.
GWh in 2018 as detailed in the table below.
GWh in 2018 as detailed in the table below.
GWh in 2018 as detailed in the table below.
GWh in 2018 as detailed in the table below.

Natural gas
Natural gas

Natural gas

Natural gas
Natural gas

34,679,620
34,679,620

34,679,620

34,679,620
34,679,620

38,627,496
38,627,496

38,627,496

38,627,496
38,627,496

Petrol
Petrol

Petrol

Petrol
Petrol

Diesel
Diesel

Diesel

Diesel
Diesel

Liquefied Petroleum Gas (LPG)
Liquefied Petroleum Gas (LPG)

Liquefied Petroleum Gas (LPG)

Liquefied Petroleum Gas (LPG)
Liquefied Petroleum Gas (LPG)

Electricity procurement from conventional tariffs
Electricity procurement from conventional tariffs

Electricity procurement from conventional tariffs

Electricity procurement from conventional tariffs
Electricity procurement from conventional tariffs

94

Electricity procurement from green tariffs
Electricity procurement from green tariffs

Electricity procurement from green tariffs

Electricity procurement from green tariffs
Electricity procurement from green tariffs

Consumption from district heating, district cooling and steam
Consumption from district heating, district cooling and steam

Consumption from district heating, district cooling and steam

Consumption from district heating, district cooling and steam
Consumption from district heating, district cooling and steam

8,677,185
8,677,185

8,677,185

8,677,185
8,677,185

5,255,293
5,255,293

5,255,293

5,255,293
5,255,293

7,910,565
7,910,565

7,910,565

7,910,565
7,910,565

8,160,611
8,160,611

8,160,611

8,160,611
8,160,611

50,179
50,179

50,179

50,179
50,179

72,702
72,702

72,702

72,702
72,702

36,130,248
36,130,248

36,130,248

36,130,248
36,130,248

30,346,347
30,346,347

30,346,347

30,346,347
30,346,347

1,142,240
1,142,240

1,142,240

1,142,240
1,142,240

1,238,345
1,238,345

1,238,345

1,238,345
1,238,345

223,000
223,000

223,000

223,000
223,000

193,000
193,000

193,000

193,000
193,000

Total energy consumption

Total energy consumption

Total energy consumption

Total energy consumption

Total energy consumption

86,157,765

86,157,765

86,157,765

86,157,765

86,157,765

86,549,066

86,549,066

86,549,066

86,549,066

86,549,066

Scope 1: Direct emissions

Scope 1: Direct emissions

Scope 1: Direct emissions

Scope 1: Direct emissions

Scope 1: Direct emissions

Scope 2: Indirect emissions

Scope 2: Indirect emissions

Scope 2: Indirect emissions

Scope 2: Indirect emissions

Scope 2: Indirect emissions

Scope 3: Business travel

Scope 3: Business travel

Scope 3: Business travel

Scope 3: Business travel

Scope 3: Business travel

10,808

10,808

10,808

10,808

10,808

18,540

18,540

18,540

18,540

18,540

19,431

19,431

19,431

19,431

19,431

10,808

10,808

10,808

10,808

10,808

10,870

10,870

10,870

10,870

10,870

19,431

19,431

19,431

19,431

19,431

With the help of these key performance indicators (KPIs), we are able to create reduction targets for energy and

With the help of these key performance indicators (KPIs), we are able to create reduction targets for energy and

With the help of these key performance indicators (KPIs), we are able to create reduction targets for energy and

With the help of these key performance indicators (KPIs), we are able to create reduction targets for energy and

With the help of these key performance indicators (KPIs), we are able to create reduction targets for energy and

CO2-emissions. We are furthermore working towards creating targets for fresh water and waste.

CO2 -emissions. We are furthermore working towards creating targets for fresh water and waste.

CO2-emissions. We are furthermore working towards creating targets for fresh water and waste.

CO2-emissions. We are furthermore working towards creating targets for fresh water and waste.

CO2-emissions. We are furthermore working towards creating targets for fresh water and waste.

Environmental Performance20191KPI 20192018KPI 2018Energy consumption by source (in kWh)20192018Footprint 2019Emission category (in tCO2)Location-basedMarket-based20191KPI 20192018KPI 2018Energy consumption by source (in kWh)20192018Footprint 2019Emission category (in tCO2)Location-basedMarket-based20191KPI 20192018KPI 2018Energy consumption by source (in kWh)20192018Footprint 2019Emission category (in tCO2)Location-basedMarket-based20191KPI 20192018KPI 2018Energy consumption by source (in kWh)20192018Footprint 2019Emission category (in tCO2)Location-basedMarket-based20191KPI 20192018KPI 2018Energy consumption by source (in kWh)20192018Footprint 2019Emission category (in tCO2)Location-basedMarket-basedAs of 2018, all relevant scope 1 and 2 emissions are included following a location-based approach. The additional

As of 2018, all relevant scope 1 and 2 emissions are included following a location-based approach. The additional

calculation using a market-based approach for scope 2 emissions was introduced for 2019 as part of our climate

calculation using a market-based approach for scope 2 emissions was introduced for 2019 as part of our climate

strategy. Accordingly, we will report our KPIs for GHG emissions using the market-based approach from next

strategy. Accordingly, we will report our KPIs for GHG emissions using the market-based approach from next

reporting year on. In addition, we have started to collect data for calculating GHG emissions in scope 3. These

reporting year on. In addition, we have started to collect data for calculating GHG emissions in scope 3. These

emissions occur along our value chain, for example through transport services, suppliers or the use of our products.

emissions occur along our value chain, for example through transport services, suppliers or the use of our products.

As a first Scope 3 category, we have integrated emissions resulting from business travel into our CCF for 2019.

As a first Scope 3 category, we have integrated emissions resulting from business travel into our CCF for 2019.

In addition to our energy and climate management activities, we collect data regarding fresh water consumption and

In addition to our energy and climate management activities, we collect data regarding fresh water consumption and

waste for all our production sites. The table below lists figures from 2019 and 2018, and expresses our consolidated

waste for all our production sites. The table below lists figures from 2019 and 2018, and expresses our consolidated

environmental data in relation to our production volume sold to establish a basis for a long-term monitoring system.

environmental data in relation to our production volume sold to establish a basis for a long-term monitoring system.

Energy

Energy

(in MWh)

(in MWh)

GHG emissions Scope 1 +

GHG emissions Scope 1 +

2
2
(in tCO2 ; location-based)
(in tCO2; location-based)

86,158

86,158

0.0188

0.0188

MWh/unit

MWh/unit

86,5492

86,5492

0.0248

0.0248

MWh/unit

MWh/unit

29,347

29,347

6,429

6,429

g/unit

g/unit

28,8982

28,8982

8,294

8,294

g/unit

g/unit

M A N A G E M E N T   R E P O R T Non-Financial Statement

Freshwater use (in m3 )
Freshwater use (in m3 )

474,335
474,335

Total waste (in t)
Total waste (in t)

Hazardous waste (in t)
Hazardous waste (in t)

1,155
1,155

330
330

104
104

253
253

72.3
72.3

l/unit
l/unit

g/unit
g/unit

g/unit
g/unit

119,621
119,621

633
633

250
250

34
34

182
182

71.7
71.7

l/unit
l/unit

g/unit
g/unit

g/unit
g/unit

(1) Extension of the scope in 2019: All sites reported energy and emissions data. 25 sites reported water consumption data. 
(1) Extension of the scope in 2019: All sites reported energy and emissions data. 25 sites reported water consumption data. 
(2) Figures for 2018 were adjusted due to improved data availability.
(2) Figures for 2018 were adjusted due to improved data availability.

Our global data collection coverage of energy and emissions was increased from 30% in 2017 to 100 % in 2019.
Our global data collection coverage of energy and emissions was increased from 30% in 2017 to 100 % in 2019.
In 2019, we achieved a decrease of 0.3 GWh in our total energy consumption to 86.2 GWh compared to 86.5
In 2019, we achieved a decrease of 0.3 GWh in our total energy consumption to 86.2 GWh compared to 86.5
GWh in 2018 as detailed in the table below.
GWh in 2018 as detailed in the table below.

Natural gas
Natural gas

Petrol
Petrol

Diesel
Diesel

Liquefied Petroleum Gas (LPG)
Liquefied Petroleum Gas (LPG)

Electricity procurement from conventional tariffs
Electricity procurement from conventional tariffs

Electricity procurement from green tariffs
Electricity procurement from green tariffs

Consumption from district heating, district cooling and steam
Consumption from district heating, district cooling and steam

Total energy consumption
Total energy consumption

34,679,620
34,679,620

8,677,185
8,677,185

5,255,293
5,255,293

50,179
50,179

36,130,248
36,130,248

1,142,240
1,142,240

223,000
223,000

86,157,765
86,157,765

38,627,496
38,627,496

7,910,565
7,910,565

8,160,611
8,160,611

72,702
72,702

30,346,347
30,346,347

1,238,345
1,238,345

193,000
193,000

86,549,066
86,549,066

Scope 1: Direct emissions
Scope 1: Direct emissions

Scope 2: Indirect emissions
Scope 2: Indirect emissions

Scope 3: Business travel
Scope 3: Business travel

10,808
10,808

18,540
18,540

19,431
19,431

10,808
10,808

10,870
10,870

19,431
19,431

With the help of these key performance indicators (KPIs), we are able to create reduction targets for energy and
With the help of these key performance indicators (KPIs), we are able to create reduction targets for energy and
CO2 -emissions. We are furthermore working towards creating targets for fresh water and waste.
CO2-emissions. We are furthermore working towards creating targets for fresh water and waste.

QIAGEN conducted a life cycle assessment (LCA) for one of its best-selling – and therefore representative – products,
the QIAamp DNA Mini Kit. The studied product is part of the portfolio category “consumables & bioinformatics”,
which about 90% of QIAGEN’s sales (by turnover) are filed under. At about 2.5 kg, the kit is marginally heavier
than an “average” QIAGEN kit.

The scope of the study has been the full life cycle of the product, including extraction and processing of raw
materials, transport to the customer, energy and material input required when using the product, as well as transport
to the disposal facility and incineration of remaining materials. These system boundary settings are called “cradle to
grave”. The assessment was carried out in accordance to ISO 14040/14044 but has not been certified by an
independent third party.

The results of the LCA show that the largest relative impacts result from the production of plastic, transport and
electricity during production and use. Furthermore, cardboard and paper production play a role, as well as the
incineration of plastics and the evaporation of alcohol during use.

A very relevant issue is ecotoxicity impacts to marine aquatic systems due to the production of polypropylene as well
as electricity generation. The depletion of fossil resources is rated second in relevance since plastics have multifold
impacts being made from fossil resources and depleting a large amount of fossil resources for meeting the energy
demand during their production. Transport and electricity generation both use large amounts of fossil resources for
fuel as well. Global Warming Potential is rated third in relevance and similarly is closely linked to energy demand
due to transport, plastics and electricity production. Plastics also have multi-fold impacts here, since their embodied
carbon is released to the atmosphere during incineration. Different assumptions regarding disposal could
significantly change the overall impacts of the product system, ranging from recycling (likely to have beneficial
impact) to landfilling (likely to have adverse impact). Although open dumps and landfills are the most prevalent form

95

of solid waste disposal globally, incineration at the end of life is deemed an accepted and reasonably conservative

approach for this product.

Overview of impact results

Product life cycle assessment20191KPI 20192018KPI 2018Energy consumption by source (in kWh)20192018Footprint 2019Emission category (in tCO2)Location-basedMarket-based20191KPI 20192018KPI 2018Energy consumption by source (in kWh)20192018Footprint 2019Emission category (in tCO2)Location-basedMarket-basedQIAGEN conducted a life cycle assessment (LCA) for one of its best-selling – and therefore representative – products,

the QIAamp DNA Mini Kit. The studied product is part of the portfolio category “consumables & bioinformatics”,

which about 90% of QIAGEN’s sales (by turnover) are filed under. At about 2.5 kg, the kit is marginally heavier

than an “average” QIAGEN kit.

The scope of the study has been the full life cycle of the product, including extraction and processing of raw

materials, transport to the customer, energy and material input required when using the product, as well as transport

to the disposal facility and incineration of remaining materials. These system boundary settings are called “cradle to
grave”. The assessment was carried out in accordance to ISO 14040/14044 but has not been certified by an
independent third party.

The results of the LCA show that the largest relative impacts result from the production of plastic, transport and
electricity during production and use. Furthermore, cardboard and paper production play a role, as well as the
incineration of plastics and the evaporation of alcohol during use.

A very relevant issue is ecotoxicity impacts to marine aquatic systems due to the production of polypropylene as well
as electricity generation. The depletion of fossil resources is rated second in relevance since plastics have multifold
impacts being made from fossil resources and depleting a large amount of fossil resources for meeting the energy
demand during their production. Transport and electricity generation both use large amounts of fossil resources for
fuel as well. Global Warming Potential is rated third in relevance and similarly is closely linked to energy demand
due to transport, plastics and electricity production. Plastics also have multi-fold impacts here, since their embodied
carbon is released to the atmosphere during incineration. Different assumptions regarding disposal could
significantly change the overall impacts of the product system, ranging from recycling (likely to have beneficial
impact) to landfilling (likely to have adverse impact). Although open dumps and landfills are the most prevalent form
of solid waste disposal globally, incineration at the end of life is deemed an accepted and reasonably conservative
approach for this product.

Overview of impact results

96

Product life cycle assessmentQIAGEN conducted a life cycle assessment (LCA) for one of its best-selling – and therefore representative – products,

the QIAamp DNA Mini Kit. The studied product is part of the portfolio category “consumables & bioinformatics”,

which about 90% of QIAGEN’s sales (by turnover) are filed under. At about 2.5 kg, the kit is marginally heavier

than an “average” QIAGEN kit.

The scope of the study has been the full life cycle of the product, including extraction and processing of raw

materials, transport to the customer, energy and material input required when using the product, as well as transport

to the disposal facility and incineration of remaining materials. These system boundary settings are called “cradle to

grave”. The assessment was carried out in accordance to ISO 14040/14044 but has not been certified by an

independent third party.

The results of the LCA show that the largest relative impacts result from the production of plastic, transport and

electricity during production and use. Furthermore, cardboard and paper production play a role, as well as the

incineration of plastics and the evaporation of alcohol during use.

A very relevant issue is ecotoxicity impacts to marine aquatic systems due to the production of polypropylene as well

as electricity generation. The depletion of fossil resources is rated second in relevance since plastics have multifold

impacts being made from fossil resources and depleting a large amount of fossil resources for meeting the energy

demand during their production. Transport and electricity generation both use large amounts of fossil resources for
fuel as well. Global Warming Potential is rated third in relevance and similarly is closely linked to energy demand
due to transport, plastics and electricity production. Plastics also have multi-fold impacts here, since their embodied
M A N A G E M E N T   R E P O R T Non-Financial Statement
carbon is released to the atmosphere during incineration. Different assumptions regarding disposal could
significantly change the overall impacts of the product system, ranging from recycling (likely to have beneficial
impact) to landfilling (likely to have adverse impact). Although open dumps and landfills are the most prevalent form
of solid waste disposal globally, incineration at the end of life is deemed an accepted and reasonably conservative
approach for this product.

Overview of impact results

Toxic effects on marine water
systems (MAETP)

Toxic effects on marine water
systems (MAETP)

941

941

kg DCB eq.

kg DCB eq.

Polypropylene

Polypropylene

Electricity

Electricity

Transport

Transport

Polyethylene

Polyethylene

Rest

Rest

Depletion of fossil resources (ADP
fossil)

Depletion of fossil resources (ADP
fossil)

289,0

289,0

MJ

MJ

Polypropylene

Polypropylene

Transport

Transport

Electricity

Electricity

Polyethylene

Polyethylene

Rest

Rest

Global warming potential,
excluding biogenic carbon (GWPe)

Global warming potential,
excluding biogenic carbon (GWPe)

21,7

21,7

kg CO2  eq.

kg CO2  eq.

Transport

Transport

Polypropylene

Polypropylene

PP incineration

PP incineration

Electricity

Electricity

Rest

Rest

Photochemical creation of ozone
Photochemical creation of ozone
("summer smog") (POCP)
("summer smog") (POCP)

0,00638

0,00638

kg Ethene eq.

kg Ethene eq.

Polypropylene

Polypropylene

Alc. evaporation

Alc. evaporation

Transport

Transport

Electricity

Electricity

Rest

Rest

Acidification of soil and water
bodies (AP)

Acidification of soil and water
bodies (AP)

0,0549

0,0549

kg SO2  eq.

kg SO2  eq.

Polypropylene

Polypropylene

Transport

Transport

Electricity

Electricity

Polyethylene

Polyethylene

Rest

Rest

Toxic effect on humans (HTP inf)

Toxic effect on humans (HTP inf)

0,643

0,643

kg DCB eq.

kg DCB eq.

Electricity

Electricity

Transport

Transport

Polyethylene

Polyethylene

Polypropylene

Polypropylene

Rest

Rest

Depletion of abiotic resources, e.g.
minerals (ADP elements)

Depletion of abiotic resources, e.g.
minerals (ADP elements)

1,69E-06

1,69E-06

kg Sb eq. Electricity

kg Sb eq. Electricity

Rest

Rest

Eutrophication (over-enrichment of
nutrients in water bodies) (EP)

Eutrophication (over-enrichment of
nutrients in water bodies) (EP)

0,00744

0,00744

kg Phosphate eq. Transport

kg Phosphate eq. Transport

Rest

Rest

Toxicity to freshwater ecosystems
(FAETP)

Toxicity to freshwater ecosystems
(FAETP)

0,0731

0,0731

kg DCB eq. Transport

kg DCB eq. Transport

Rest

Rest

Depletion of ozone (i.e. the ozone
layer) (ODP)

Depletion of ozone (i.e. the ozone
layer) (ODP)

8,37E-11

8,37E-11

kg R11 eq. Paper

kg R11 eq. Paper

Rest

Rest

Toxic effects on terrestric systems,
i.e. soil (TETP)

Toxic effects on terrestric systems,
i.e. soil (TETP)

0,00563

0,00563

kg DCB eq. Electricity

kg DCB eq. Electricity

Rest

Rest

* Relevance is calculated as the share of weights and normalized impact of the respective category.

* Relevance is calculated as the share of weights and normalized impact of the respective category.

44%

44%

43%

43%

9%

1%

2%

9%

1%

2%

44%

44%

31%

31%

13%

13%

4%

8%

4%

8%

30%

30%

27%

27%

19%

19%

16%

16%

8%

8%

37%

37%

30%

30%

23%

23%

9%

2%

9%

2%

43%

43%

35%

35%

16%

16%

2%

4%

2%

4%

34%

34%

23%

23%

20%

20%

7%

7%

15%

15%

57%

57%

43%

43%

54%

54%

46%

46%

41%

41%

59%

59%

94%

94%

6%

6%

52%

52%

48%

48%

97

Impact CategoryResultUnitProcessesShareProduct life cycle assessmentImpact CategoryResultUnitProcessesShareThe detailed report on the LCA results can be found on QIAGEN's website in the Sustainability section.

The environmental impact of plastic materials is increasingly becoming a major concern for customers. QIAGEN
currently uses plastics in many of its products and production support materials, as well as for transport and
packaging purposes. This year, QIAGEN has set the goal of reducing Plastic Transportation Packaging Material by
3% vs 2019 for 2020. The reduction of plastic materials presents us and our industry with a number of challenges:
Due to the use of our products in laboratory or medical applications, these products are subject to strict functional
and legal requirements so in many cases other materials cannot simply be substituted for plastics. In the case of
packaging materials, we must ensure that appropriate safety and hygiene standards are met.

In 2018, we set up a global cross-departmental Plastic Footprint Reduction focus team for “Plastic Footprint
Reduction” to analyze the use of plastics and specifically identify reduction potential for QIAGEN. Our approach is
to completely avoid unnecessary materials, develop more environmentally-friendly alternative materials, and where
possible, optimize recyclability. Completed initiatives include reducing the thickness of blister film in packaging from
10 ml to 8 ml (reduction of 2.8 tonnes/year), reducing the number of gel packs used in cold shipment of our
products (reduction of 33.4 tonnes/year), reducing the size of polystyrene foam boxes by optimizing how the
contents are structured, and developing a digital recycling card that explains to customers how to properly dispose
of packaging components.

To identify starting points within our supply chain, we have initiated a query with suppliers about their use of plastic
materials. We are still in the process of exploring a “box cycle” where supplies are packaged directly by our
suppliers and the packaging material is returned to them, with results expected in 2020. In addition, we are in
discussions with suppliers in order to achieve a better recyclability of their products. Scrap plastics produced as part
of the component production process are already recycled at major supplier sites.

Employees

QIAGEN’s long-term success and growth are shaped decisively by the knowledge, skill and passion of our
employees. Focusing on human capital therefore drives our economic performance and considerably influences the
sustainability of our operations. We are convinced that the professional and personal development of our employees
is an integral factor in creating value for our customers, patients, colleagues, partners and shareholders. Being the
industry’s employer of choice by attracting and developing top talent is one of our global goals. To achieve that,
QIAGEN creates a work environment that empowers and involves employees at all levels.

As a company headquartered in the European Union, freedom of association and collective bargaining are
cornerstones of the good relationship between management and representatives of employees. We don’t have
significant operations (more than 100 employees) in countries with severe legal limitations to freedom of association
and collective bargaining. In all regions where we operate, we respect local laws and regulations concerning labor
relations.

Among all QIAGEN guidelines, the following policies aim to incorporate QIAGEN’s culture and values into all of our
internal and external relationships. These are available internally for all employees.

Our Ethical Standards Policy: QIAGEN’s cultural norms and values are defined in the “3I’s: Identity, Inspire, Impact.”
Our values form the basis of our business success and every employee is expected to treat everyone in an open,
honest, and respectful manner.

All our employees in the various regions of the world are covered by the relevant local laws or by our voluntary
corporate guidelines to the greatest possible extent, which guarantee freedom of association and/or collective
bargaining mechanisms.

98
Depending on local law and custom, there are different types of employment ranging from long-term fixed contracts
to temporary positions, also including flexible time and programs for parents returning from childcare. In 2019, we

Plastic Footprint ReductionThe detailed report on the LCA results can be found on QIAGEN's website in the Sustainability section.

The environmental impact of plastic materials is increasingly becoming a major concern for customers. QIAGEN

currently uses plastics in many of its products and production support materials, as well as for transport and

packaging purposes. This year, QIAGEN has set the goal of reducing Plastic Transportation Packaging Material by

3% vs 2019 for 2020. The reduction of plastic materials presents us and our industry with a number of challenges:

Due to the use of our products in laboratory or medical applications, these products are subject to strict functional

and legal requirements so in many cases other materials cannot simply be substituted for plastics. In the case of

packaging materials, we must ensure that appropriate safety and hygiene standards are met.

In 2018, we set up a global cross-departmental Plastic Footprint Reduction focus team for “Plastic Footprint

Reduction” to analyze the use of plastics and specifically identify reduction potential for QIAGEN. Our approach is

to completely avoid unnecessary materials, develop more environmentally-friendly alternative materials, and where

possible, optimize recyclability. Completed initiatives include reducing the thickness of blister film in packaging from

10 ml to 8 ml (reduction of 2.8 tonnes/year), reducing the number of gel packs used in cold shipment of our

products (reduction of 33.4 tonnes/year), reducing the size of polystyrene foam boxes by optimizing how the

contents are structured, and developing a digital recycling card that explains to customers how to properly dispose

of packaging components.

To identify starting points within our supply chain, we have initiated a query with suppliers about their use of plastic

materials. We are still in the process of exploring a “box cycle” where supplies are packaged directly by our

suppliers and the packaging material is returned to them, with results expected in 2020. In addition, we are in

discussions with suppliers in order to achieve a better recyclability of their products. Scrap plastics produced as part

of the component production process are already recycled at major supplier sites.

Employees

QIAGEN’s long-term success and growth are shaped decisively by the knowledge, skill and passion of our

employees. Focusing on human capital therefore drives our economic performance and considerably influences the

sustainability of our operations. We are convinced that the professional and personal development of our employees

is an integral factor in creating value for our customers, patients, colleagues, partners and shareholders. Being the

industry’s employer of choice by attracting and developing top talent is one of our global goals. To achieve that,

QIAGEN creates a work environment that empowers and involves employees at all levels.

As a company headquartered in the European Union, freedom of association and collective bargaining are

cornerstones of the good relationship between management and representatives of employees. We don’t have

significant operations (more than 100 employees) in countries with severe legal limitations to freedom of association

and collective bargaining. In all regions where we operate, we respect local laws and regulations concerning labor

relations.

Among all QIAGEN guidelines, the following policies aim to incorporate QIAGEN’s culture and values into all of our
M A N A G E M E N T   R E P O R T Non-Financial Statement
internal and external relationships. These are available internally for all employees.

Our Ethical Standards Policy: QIAGEN’s cultural norms and values are defined in the “3I’s: Identity, Inspire, Impact.”
Our values form the basis of our business success and every employee is expected to treat everyone in an open,
honest, and respectful manner.

All our employees in the various regions of the world are covered by the relevant local laws or by our voluntary
corporate guidelines to the greatest possible extent, which guarantee freedom of association and/or collective
bargaining mechanisms.

Depending on local law and custom, there are different types of employment ranging from long-term fixed contracts
to temporary positions, also including flexible time and programs for parents returning from childcare. In 2019, we
employed 3.03% part-time employees (2018: 5.57%) and 1.24 % temporary employees with QIAGEN contract /
fixed-term work contract (2018: 1.26%).

As a fast-growing technology and knowledge-based company, we consider high-quality training and career
development to be an integral part of our success. The QIAGEN Academy provides the possibility to either use our
global e-learning portfolio or to participate in personal trainings usually offered in a blended format. The focus is on
job-specific skills, competencies and leadership development.

In 2019, we ran a mix of internal instructor-led, virtual instructor-led and e-learning courses attended by 3,951 of
4,193 employees. 12% of these courses were attended by management level employees. In addition, 46 employees
participated in our advanced leadership development programs.

As part of our talent and succession management, we have established transparent career paths with the QIAGEN
Profile Navigator (QPN). It defines jobs, core competencies and approaches to advancement across the global
organization.

In addition, QIAGEN’s global Performance Enhancement System (PES) creates a clear framework of regular, one-on-
one review sessions for each employee and their manager to discuss career development. These include discussions
of goals and achievement levels, assessment of relevant competencies, as well as training needs and career planning
steps.

The supervisor feedback process provides the opportunity for employees to provide anonymized feedback to their
supervisors. For 2019, as in previous years, employees provided overall very positive feedback.

Our Diversity & Inclusion Philosophy: At QIAGEN, we are committed to creating an environment rich in diversity.
Diverse teams strengthen our organization through the variety of ideas of opinions. In addition, teams outperform
and succeed when they are composed of individuals with the widest possible range of personalities, backgrounds
and traits. Therefore, one of our goals is to maintain an environment where all individuals have the opportunity to
grow and contribute to our progress.

We are committed to providing an environment where all individuals have the equal opportunity to grow and
contribute to our progress; regardless of their age, educational background, sex (including gender identity and
sexual orientation), nationality, veteran status, physical abilities, neurotype, race, ethnic background, or religion.
Strategic consideration of diversity not only makes QIAGEN a better place to work. We also consider it to be a key
success factor on the path to achieving our mission and goals.

As in 2018, the gender split across the whole company remained at 51% men and 49% women. The participation
of women in leadership roles was at 29% (2018: 28%). We aim to achieve 30% women in leadership roles in
2020. Specific information about the diversity policy for the composition of the Managing Board and the Supervisory
Board can be found in the Corporate Governance Report.

In 2019, we launched the QIAGEN Executive Council of Equal Opportunity, made up of senior representatives from
different sectors across the company. The committee works closely with the Diversity Ambassador program, that was
set up in 2018 and includes more than 20 employees from across the world to champion diversity in the sites and
countries they are based in. Training has been developed to help address unconscious bias, including an online

99

assessment, and is aimed at all managers of people. QIAGEN remains committed to diversity, and we continue to

develop and implement additional programs to promote awareness and are working to implement additional

procedures to enable improvements in measurement and monitoring of diversity in future periods. In 2019, this

included an update to our parental leave in the United States, which was a direct result of the diversity forums led by

our ambassadors in conjunction with the executive committee members.

Plastic Footprint ReductionEmployee trainingDiversityRecognizing that QIAGEN’s employees are the key to our success, we seek to be a great place to work. QIAGEN
offers opportunities to work on exciting tasks and projects in an engaging work environment. Employees join
QIAGEN and stay with QIAGEN because they can see how their work makes a difference to people`s life
everywhere in the world. Internal and external ratings have improved significantly and show QIAGEN’s reputation
and preferred position in the global working environment.

A prudent work-life balance is an important measure to create and maintain employee satisfaction. We provide
services to help employees balance their personal lives with the company’s dynamic work environment, including in-
house childcare, sabbatical programs, and flexible working hours.

QIAGEN has implemented frameworks for performance-based compensation, equity-based compensation, and
incentive programs for new ideas and innovation. These programs aim to ensure fair and attractive compensation
and to encourage each employee to work for the company’s long-term benefit.

An essential component of QIAGEN’s efforts to maintain a high level of satisfaction at work is our corporate health
and safety management. We offer a wide range of measures and tools, from annual “health days” with free
counseling, screening and medical check-ups to sports opportunities in the form of in-house gyms, on-site soccer fields
and beach volleyball courts.

QIAGEN’s commitment to being an employer of choice is also reflected in the high number of applications for open
positions, which exceeded 27,000 applications in 2019 (2018: > 40,000). At the same time, the average voluntary
annual turnover rate has decreased year over year.

QIAGEN recognizes its responsibilities with respect to health and occupational safety in all our operations and meets
all applicable regulatory requirements. In the third quarter of 2019, a leading position for EHS (environment, health,
safety) was appointed to provide direction and implementation of a global health and safety management system
compliant with ISO45001, which will be implemented within the manufacturing facilities, research and development
as well as business service centers over the next three years. All QIAGEN facilities operate health and safety
procedures at local level, which include accident reporting, risk assessments and hazard analyses, and occupational
safety and health audits, which lead to the implementation of improvement measures. All employees of the company
are required to adhere to local health and safety procedures and practices. Safety, orderliness and cleanliness are
demanded by management as a key success factor.

QIAGEN committed to an all company goal to reduce the number of lost days due to injuries by 10% vs 2019 over
2020, to drive and encourage initiatives to improve the safety culture in QIAGEN.

The table below table shows the total number of recordable incidents, (recordable accidents include lost workdays,
restricted work, and medical treatment beyond first aid) and lost workdays for 2019, 2018 and 2017. The data is
obtained from key QIAGEN manufacturing sites in Germany, US, China, Sweden and Tokyo. It also includes the
research and development site in Manchester UK and the large business service center located in Poland. Thus data
is equates to 60% of the total average number of employees. There were no reported fatalities for 2019 at any of the
QIAGEN sites.

Europe / Middle East / Africa

100

Americas

Asia-Pacific / Japan

17

3

0

28

26

0

21

23

0

121

5

0

261

16

0

52

18

0

Employee satisfaction and retentionOccupational safety and health protectionTotal Recordable IncidentsDays Lost due to Injuries201920182017201920182017Recognizing that QIAGEN’s employees are the key to our success, we seek to be a great place to work. QIAGEN

offers opportunities to work on exciting tasks and projects in an engaging work environment. Employees join

QIAGEN and stay with QIAGEN because they can see how their work makes a difference to people`s life

everywhere in the world. Internal and external ratings have improved significantly and show QIAGEN’s reputation

and preferred position in the global working environment.

A prudent work-life balance is an important measure to create and maintain employee satisfaction. We provide

services to help employees balance their personal lives with the company’s dynamic work environment, including in-

house childcare, sabbatical programs, and flexible working hours.

QIAGEN has implemented frameworks for performance-based compensation, equity-based compensation, and

incentive programs for new ideas and innovation. These programs aim to ensure fair and attractive compensation

and to encourage each employee to work for the company’s long-term benefit.

An essential component of QIAGEN’s efforts to maintain a high level of satisfaction at work is our corporate health

and safety management. We offer a wide range of measures and tools, from annual “health days” with free

counseling, screening and medical check-ups to sports opportunities in the form of in-house gyms, on-site soccer fields

and beach volleyball courts.

QIAGEN’s commitment to being an employer of choice is also reflected in the high number of applications for open

positions, which exceeded 27,000 applications in 2019 (2018: > 40,000). At the same time, the average voluntary

annual turnover rate has decreased year over year.

QIAGEN recognizes its responsibilities with respect to health and occupational safety in all our operations and meets

all applicable regulatory requirements. In the third quarter of 2019, a leading position for EHS (environment, health,

safety) was appointed to provide direction and implementation of a global health and safety management system

compliant with ISO45001, which will be implemented within the manufacturing facilities, research and development

as well as business service centers over the next three years. All QIAGEN facilities operate health and safety

procedures at local level, which include accident reporting, risk assessments and hazard analyses, and occupational

safety and health audits, which lead to the implementation of improvement measures. All employees of the company

are required to adhere to local health and safety procedures and practices. Safety, orderliness and cleanliness are

demanded by management as a key success factor.

QIAGEN committed to an all company goal to reduce the number of lost days due to injuries by 10% vs 2019 over

2020, to drive and encourage initiatives to improve the safety culture in QIAGEN.

The table below table shows the total number of recordable incidents, (recordable accidents include lost workdays,
restricted work, and medical treatment beyond first aid) and lost workdays for 2019, 2018 and 2017. The data is
obtained from key QIAGEN manufacturing sites in Germany, US, China, Sweden and Tokyo. It also includes the
M A N A G E M E N T   R E P O R T Non-Financial Statement
research and development site in Manchester UK and the large business service center located in Poland. Thus data
is equates to 60% of the total average number of employees. There were no reported fatalities for 2019 at any of the
QIAGEN sites.

Europe / Middle East / Africa

Americas

Asia-Pacific / Japan

Human Rights

17

3

0

28

26

0

21

23

0

121

5

0

261

16

0

52

18

0

QIAGEN believes that the respect for human rights is an essential component of promoting sustainability in our
global business. As a publicly listed company with international operations, we regard ourselves as a responsible
corporate citizen in all the countries and regions where we do business. This role includes rights and obligations
governed by international and national law, with human rights as one of the foundations of international law.

In this sense, we acknowledge and endorse the UN Universal Declaration of Human Rights, the European
Convention on Human Rights, and the business-related Organisation for Economic Cooperation and Development
(OECD) Guidelines for Multinational Enterprises, the ILO Declaration on Fundamental Principles and Rights at Work,
and the UN Guiding Principles on Business and Human Rights and its application in National Actions Plans of our
relevant jurisdictions.

In 2019, QIAGEN adopted a new Human Rights Policy, which is designed to provide guidance on all human rights
issues in our sphere of influence such as in our relationship with customers, on the employee level, and in our supply
chain. For more information on our due diligence processes with regard to human rights in our supply chain, please
refer to the "Sustainable supply chain management" section.

Sustainable Supply Chain Management

QIAGEN strives to ensure that its quality standards, compliance with laws and regulations as well as environmental
and social standards are maintained along the entire value chain of suppliers and partners. We demand the same
from our business partners. Our procurement policy includes specific requirements for corporate governance,
environmental and social standards, which we expect from our suppliers as minimum standards. Among other issues,
it includes the obligations to reduce the use of substances of concern, to ensure collective bargaining and freedom of
association among employees, fair wages, and regulations concerning maximum working time. The policy is publicly
available on the QIAGEN Website.

In alignment with QIAGEN’s Compliance Program (especially QIAGEN’s Corporate Code of Conduct and Ethics),
every QIAGEN employee must conduct themselves honestly, fairly, and objectively in all business relationships with
suppliers and all others with whom QIAGEN maintains business relationships. Regular online training in the QIA-
Academy ensures that employees in the procurement organization understand our guidelines and comply with them.

QIAGEN operates in over 35 locations worldwide. Our sites are supported by a global supplier network that
includes approximately 9,000 suppliers in over 60 countries, supplying resources such as chemicals and
bioreagents, plastics, packaging materials, as well as other materials and services essential to our business. In 2019,
83% of our overall purchasing volume came from OECD countries.

Europe

North America

Asia

Australia

South America

Africa

Total

101

53%

24%

19%

3%

1%

0%

100%

Structure of our supply chainRegion of origin of suppliersDue diligence processRegion of origin%Employee satisfaction and retentionOccupational safety and health protectionTotal Recordable IncidentsDays Lost due to Injuries201920182017201920182017Human Rights

Human Rights

QIAGEN believes that the respect for human rights is an essential component of promoting sustainability in our

QIAGEN believes that the respect for human rights is an essential component of promoting sustainability in our

global business. As a publicly listed company with international operations, we regard ourselves as a responsible

global business. As a publicly listed company with international operations, we regard ourselves as a responsible

corporate citizen in all the countries and regions where we do business. This role includes rights and obligations

corporate citizen in all the countries and regions where we do business. This role includes rights and obligations

governed by international and national law, with human rights as one of the foundations of international law.

governed by international and national law, with human rights as one of the foundations of international law.

In this sense, we acknowledge and endorse the UN Universal Declaration of Human Rights, the European

In this sense, we acknowledge and endorse the UN Universal Declaration of Human Rights, the European

Convention on Human Rights, and the business-related Organisation for Economic Cooperation and Development

Convention on Human Rights, and the business-related Organisation for Economic Cooperation and Development

(OECD) Guidelines for Multinational Enterprises, the ILO Declaration on Fundamental Principles and Rights at Work,

(OECD) Guidelines for Multinational Enterprises, the ILO Declaration on Fundamental Principles and Rights at Work,

and the UN Guiding Principles on Business and Human Rights and its application in National Actions Plans of our

and the UN Guiding Principles on Business and Human Rights and its application in National Actions Plans of our

relevant jurisdictions.

relevant jurisdictions.

In 2019, QIAGEN adopted a new Human Rights Policy, which is designed to provide guidance on all human rights

In 2019, QIAGEN adopted a new Human Rights Policy, which is designed to provide guidance on all human rights

issues in our sphere of influence such as in our relationship with customers, on the employee level, and in our supply

issues in our sphere of influence such as in our relationship with customers, on the employee level, and in our supply

chain. For more information on our due diligence processes with regard to human rights in our supply chain, please

chain. For more information on our due diligence processes with regard to human rights in our supply chain, please

refer to the "Sustainable supply chain management" section.

refer to the "Sustainable supply chain management" section.

Sustainable Supply Chain Management

Sustainable Supply Chain Management

QIAGEN strives to ensure that its quality standards, compliance with laws and regulations as well as environmental

QIAGEN strives to ensure that its quality standards, compliance with laws and regulations as well as environmental

and social standards are maintained along the entire value chain of suppliers and partners. We demand the same

and social standards are maintained along the entire value chain of suppliers and partners. We demand the same

from our business partners. Our procurement policy includes specific requirements for corporate governance,

from our business partners. Our procurement policy includes specific requirements for corporate governance,

environmental and social standards, which we expect from our suppliers as minimum standards. Among other issues,

environmental and social standards, which we expect from our suppliers as minimum standards. Among other issues,

it includes the obligations to reduce the use of substances of concern, to ensure collective bargaining and freedom of

it includes the obligations to reduce the use of substances of concern, to ensure collective bargaining and freedom of

association among employees, fair wages, and regulations concerning maximum working time. The policy is publicly

association among employees, fair wages, and regulations concerning maximum working time. The policy is publicly

available on the QIAGEN Website.

available on the QIAGEN Website.

In alignment with QIAGEN’s Compliance Program (especially QIAGEN’s Corporate Code of Conduct and Ethics),

In alignment with QIAGEN’s Compliance Program (especially QIAGEN’s Corporate Code of Conduct and Ethics),

every QIAGEN employee must conduct themselves honestly, fairly, and objectively in all business relationships with

every QIAGEN employee must conduct themselves honestly, fairly, and objectively in all business relationships with

suppliers and all others with whom QIAGEN maintains business relationships. Regular online training in the QIA-

suppliers and all others with whom QIAGEN maintains business relationships. Regular online training in the QIA-

Academy ensures that employees in the procurement organization understand our guidelines and comply with them.

Academy ensures that employees in the procurement organization understand our guidelines and comply with them.

QIAGEN operates in over 35 locations worldwide. Our sites are supported by a global supplier network that
includes approximately 9,000 suppliers in over 60 countries, supplying resources such as chemicals and
bioreagents, plastics, packaging materials, as well as other materials and services essential to our business. In 2019,
83% of our overall purchasing volume came from OECD countries.

QIAGEN operates in over 35 locations worldwide. Our sites are supported by a global supplier network that
includes approximately 9,000 suppliers in over 60 countries, supplying resources such as chemicals and
bioreagents, plastics, packaging materials, as well as other materials and services essential to our business. In 2019,
83% of our overall purchasing volume came from OECD countries.

Europe

Europe

North America

North America

Asia

Asia

Australia

Australia

South America

South America

Africa

Africa

Total

Total

53%

24%

19%

3%

1%

0%

53%

24%

19%

3%

1%

0%

100%

100%

In order to minimize compliance, environmental and social risks in our supply chain, we apply a multi-stage vendor
selection process. Suppliers are subjected to a risk analysis with regard to environmental and social criteria based on
their geographic location. These criteria were supported by information from the MVO Nederlands platform financed
by the Dutch Foreign Ministry as well as the Bertelsmann Stiftung’s Sustainable Development Goals Index. As a result,
70 suppliers were identified for whom potential risks exist due to geographic location and sales to QIAGEN.

In 2019 all identified suppliers have signed QIAGEN’s procurement policy. All new suppliers will need to sign the
policy as part of the contracting process. The policy contains requirements with regard to legal compliance, bribery
and corruption, labor rights, non-discrimination and fair treatment, health and safety as well as environmental
protection and conservation. QIAGEN provides a whistleblower hotline which can be used by all employees. The
contact details can be found on QIAGEN’s website within the section Corporate Code of Conduct and Ethics.In
addition, first-tier suppliers must confirm REACH, RoHS and SEC compliance as appropriate.

As part of our supplier selection process, we additionally assess the suppliers’ policy with a perspective on
QIAGEN's requirements. Supplier audits are conducted if non-compliance is suspected. Audits are conducted on-site,
at least every three years for all “A”-categorized direct suppliers. Audits are documented and results are being
shared with audited suppliers. To our knowledge, there were no violations regarding corporate governance,
environmental and social standards in the reporting period.

The sourcing of certain minerals (known as “conflict minerals”) has been linked with human rights abuses in the
Democratic Republic of Congo ("DRC") and other conflict zones. QIAGEN has performed an extensive inquiry into
the company’s supply chain to confirm that the products supplied to us are either DRC conflict-free or that the
suppliers are not aware of any non-compliance in their supply base. QIAGEN has no indication that any conflict
minerals from the Democratic Republic of Congo or adjoining countries are used in the company’s laboratory
instruments.

Our products consist of sample and assay kits, known as consumables, and automated instrumentation systems. We
do not believe that any conflict minerals are necessary to the production or functionality of any of our consumable
products. We conduct due diligence measures annually to determine the presence of conflict minerals in our
instrumentation products and the source of any such conflict Minerals. Because we do not purchase conflict minerals
directly from smelters or refineries, we rely on our suppliers to specify to us their Conflict Minerals sources and
declare their conflict minerals status. We disclosed our conflict minerals findings to the U.S. Securities and Exchange
Commission ("SEC") for the calendar year ending December 31, 2019, on Form SD on March 27, 2020, and will
provide updated disclosure to the SEC annually.

Data and Cyber Security

102
As the external threat landscape continues to evolve, managing cyber security risk is a priority for QIAGEN. The
company continues to make investments in its capabilities to enhance cyber resilience of our organization, products,

services and preserve the trust of our customers, partners and employees.

In 2019, QIAGEN further improved cyber security governance by establishing a dedicated cyber security function

with global responsibilities and leadership. Building on our Information Security Framework, QIAGEN's cyber

security program continues to ensure that security governance efforts and initiatives reflect evolving business

requirements, regulatory guidance, and emerging threats. Our membership in private and public cyber security

organizations (such as Health Information Sharing and Analysis Center, BSI Alliance for Cyber Security) facilitates

close collaboration with peer organizations and government authorities to share industry-relevant best practices and

threat information.

Business Ethics

For QIAGEN, conducting business in a responsible way includes looking beyond our day-to-day business operations

into the ethical foundations of our company. This means, in particular, the respect for human rights and legally

Structure of our supply chainRegion of origin of suppliersDue diligence processRegion of origin%Conflict mineralsStructure of our supply chainRegion of origin of suppliersDue diligence processRegion of origin%In order to minimize compliance, environmental and social risks in our supply chain, we apply a multi-stage vendor

selection process. Suppliers are subjected to a risk analysis with regard to environmental and social criteria based on

their geographic location. These criteria were supported by information from the MVO Nederlands platform financed

by the Dutch Foreign Ministry as well as the Bertelsmann Stiftung’s Sustainable Development Goals Index. As a result,

70 suppliers were identified for whom potential risks exist due to geographic location and sales to QIAGEN.

In 2019 all identified suppliers have signed QIAGEN’s procurement policy. All new suppliers will need to sign the

policy as part of the contracting process. The policy contains requirements with regard to legal compliance, bribery

and corruption, labor rights, non-discrimination and fair treatment, health and safety as well as environmental

protection and conservation. QIAGEN provides a whistleblower hotline which can be used by all employees. The

contact details can be found on QIAGEN’s website within the section Corporate Code of Conduct and Ethics.In

addition, first-tier suppliers must confirm REACH, RoHS and SEC compliance as appropriate.

As part of our supplier selection process, we additionally assess the suppliers’ policy with a perspective on

QIAGEN's requirements. Supplier audits are conducted if non-compliance is suspected. Audits are conducted on-site,

at least every three years for all “A”-categorized direct suppliers. Audits are documented and results are being

shared with audited suppliers. To our knowledge, there were no violations regarding corporate governance,

environmental and social standards in the reporting period.

The sourcing of certain minerals (known as “conflict minerals”) has been linked with human rights abuses in the

Democratic Republic of Congo ("DRC") and other conflict zones. QIAGEN has performed an extensive inquiry into

the company’s supply chain to confirm that the products supplied to us are either DRC conflict-free or that the

suppliers are not aware of any non-compliance in their supply base. QIAGEN has no indication that any conflict

minerals from the Democratic Republic of Congo or adjoining countries are used in the company’s laboratory

instruments.

Our products consist of sample and assay kits, known as consumables, and automated instrumentation systems. We

do not believe that any conflict minerals are necessary to the production or functionality of any of our consumable
products. We conduct due diligence measures annually to determine the presence of conflict minerals in our
M A N A G E M E N T   R E P O R T Non-Financial Statement
instrumentation products and the source of any such conflict Minerals. Because we do not purchase conflict minerals
directly from smelters or refineries, we rely on our suppliers to specify to us their Conflict Minerals sources and
declare their conflict minerals status. We disclosed our conflict minerals findings to the U.S. Securities and Exchange
Commission ("SEC") for the calendar year ending December 31, 2019, on Form SD on March 27, 2020, and will
provide updated disclosure to the SEC annually.

Data and Cyber Security

As the external threat landscape continues to evolve, managing cyber security risk is a priority for QIAGEN. The
company continues to make investments in its capabilities to enhance cyber resilience of our organization, products,
services and preserve the trust of our customers, partners and employees.

In 2019, QIAGEN further improved cyber security governance by establishing a dedicated cyber security function
with global responsibilities and leadership. Building on our Information Security Framework, QIAGEN's cyber
security program continues to ensure that security governance efforts and initiatives reflect evolving business
requirements, regulatory guidance, and emerging threats. Our membership in private and public cyber security
organizations (such as Health Information Sharing and Analysis Center, BSI Alliance for Cyber Security) facilitates
close collaboration with peer organizations and government authorities to share industry-relevant best practices and
threat information.

Business Ethics

For QIAGEN, conducting business in a responsible way includes looking beyond our day-to-day business operations
into the ethical foundations of our company. This means, in particular, the respect for human rights and legally
compliant business behavior.

QIAGEN occasionally received grants for specified development activities from governments to support research and
development activities. These grants are further discussed in section 3.7 Government Grants of Note 3 "Summary of
Significant Accounting Policies, Estimates and Judgments" of the 2019 IFRS Annual Report.

We pay income tax related to the value added by QIAGEN's operational activities to the governments in the global
regions of operations as follows:


Europe / Middle East / Africa

$ 18,186

$ 14,120

$ 19,595

Americas

Asia-Pacific / Japan

10,346

12,942

4,025

11,172

11,767

9,137

Total income taxes paid, net

$ 41,474

$ 29,317

$ 40,499

Income taxes paid exclude government incentives due to favorable tax regulations in the U.S., Spain and the U.K.
relating to research and development expense.

We conduct business globally and, as a result, file numerous consolidated and separate income tax returns in the
Netherlands, Germany, and the U.S. federal jurisdiction, as well as in various other states and foreign jurisdictions.

Governments and public institutions do not hold any major shares in QIAGEN.

For additional information on the Group’s income taxes please refer to Note 17 Income Tax.

Compliance

103

As a publicly listed company with international operations, QIAGEN is subject to regulation in various jurisdictions.

Unethical behavior and non-compliance with laws and regulations have the potential to seriously harm our business,

our reputation and our shareholders and to expose our employees to personal liability. QIAGEN has established a

comprehensive Compliance Program, which translates legal and regulatory requirements as well as our fundamental

values into clear, precise and understandable guidelines in our Corporate Code of Conduct and Ethics and

supplementing specific policies for our employees. The policies include, but are not limited to, aspects as conflicts of

interest, insider trading, revenue recognition, interactions with healthcare professionals, confidentiality and social

media. QIAGEN does not make any payments to political parties or political action committees.

Special attention is paid to antitrust and anti-corruption laws (see http://financialreport.qiagen.com/management-

report/opportunities-and-risks). Our specific antitrust and anti-corruption policies set forth our commitment to ensure

that QIAGEN and its subsidiaries abide by the antitrust and anti-corruption laws of the countries in which we

operate.

We extend our Compliance Program not only to our management and employees, but also to third-party

intermediaries as distributors or agents. Third-party due diligence lies in the remit of the Sales Compliance Manager.

This contains the following five elements:

Conflict mineralsPayments received from governmentPayments to governmentsFinancial assistance from governmentsYear ended December 31,($ in thousands)201920182017compliant business behavior.

QIAGEN occasionally received grants for specified development activities from governments to support research and

development activities. These grants are further discussed in section 3.7 Government Grants of Note 3 "Summary of

Significant Accounting Policies, Estimates and Judgments" of the 2019 IFRS Annual Report.

We pay income tax related to the value added by QIAGEN's operational activities to the governments in the global

regions of operations as follows:


Europe / Middle East / Africa

$ 18,186

$ 14,120

$ 19,595

Americas

Asia-Pacific / Japan

10,346

12,942

4,025

11,172

11,767

9,137

Total income taxes paid, net

$ 41,474

$ 29,317

$ 40,499

Income taxes paid exclude government incentives due to favorable tax regulations in the U.S., Spain and the U.K.
relating to research and development expense.

We conduct business globally and, as a result, file numerous consolidated and separate income tax returns in the
Netherlands, Germany, and the U.S. federal jurisdiction, as well as in various other states and foreign jurisdictions.

Governments and public institutions do not hold any major shares in QIAGEN.

For additional information on the Group’s income taxes please refer to Note 17 Income Tax.

Compliance

As a publicly listed company with international operations, QIAGEN is subject to regulation in various jurisdictions.
Unethical behavior and non-compliance with laws and regulations have the potential to seriously harm our business,
our reputation and our shareholders and to expose our employees to personal liability. QIAGEN has established a
comprehensive Compliance Program, which translates legal and regulatory requirements as well as our fundamental
values into clear, precise and understandable guidelines in our Corporate Code of Conduct and Ethics and
supplementing specific policies for our employees. The policies include, but are not limited to, aspects as conflicts of
interest, insider trading, revenue recognition, interactions with healthcare professionals, confidentiality and social
media. QIAGEN does not make any payments to political parties or political action committees.

Special attention is paid to antitrust and anti-corruption laws (see http://financialreport.qiagen.com/management-
report/opportunities-and-risks). Our specific antitrust and anti-corruption policies set forth our commitment to ensure
that QIAGEN and its subsidiaries abide by the antitrust and anti-corruption laws of the countries in which we
operate.

We extend our Compliance Program not only to our management and employees, but also to third-party
intermediaries as distributors or agents. Third-party due diligence lies in the remit of the Sales Compliance Manager.
This contains the following five elements:

1. Anti-corruption questionnaire and certification for new distributors, resellers and agents;
2. Annual risk assessment based on a calculated risk score, which factors location of business (Transparency
International Index Score, TIIS) and annual sales revenue for distributing QIAGEN products by multiplying total
revenues of the prior calendar year with the inverse of the TIIS;
3. Training;
4. Contractual obligations;
5. Due diligence (including selected background checks); also including payment monitoring.

All our policies are available to employees through the company’s Compliance@QIAGEN intranet pages.
Compliance awareness of our employees in all areas of the world is increased by regular trainings, which are held
by external as well as inhouse legal and regulatory experts. In addition, QIAGEN has entered into a long-term online
training program focusing on topics such as antitrust and competition, bribery and corruption, conflicts of interest,
data protection, gifts and entertainment, harassment, insider trading, reporting as well as respectful communication.
Online training reaches all employees in local language, supported by multiple communication resources. New
employees are required to take online training on our Corporate Code of Conduct and Ethics at a minimum.
Additional trainings which are customized to the specific area of responsibility are mandatory. Employees in Sales
and Marketing as well as Upper Management are required to take training on anti-corruption and antitrust laws.
These basic trainings are followed by refresher courses on a regular basis. In 2019, our employees completed more
than 10,000 online training modules. In addition, employees are informed through the company’s
Compliance@QIAGEN intranet page and regular updates on compliance topics via the company’s internal
communication platform Yammer.

We have established a hotline for reporting accounting-related concerns on an anonymous basis in good faith. In
accordance with the U.S. Sarbanes-Oxley Act of 2002 and the listing standards of NYSE, QIAGEN follows as strict
non-retaliation policy. QIAGEN will diligently investigate all such complaints and will protect the anonymity of the
complainant. We also offer a direct e-mail and telephone hotline for employees to address questions or make
suggestions for our Compliance Program.

104
Our Compliance Program is overseen by the Compliance Committee under the leadership of the Head of Global
Legal Affairs and Compliance, who reports in this function directly to the Audit Committee of the Supervisory Board.
The Compliance Committee consists of managers from Legal, Internal Audit, Human Resources, Commercial

Operations, Trade Compliance and Regulatory functions.

In the reporting period, QIAGEN had no legal actions pending or completed with regard to antitrust or corruption.

Social Matters

QIAGEN’s mission is to make improvements in life possible by enabling our customers to achieve outstanding

success and breakthroughs in life sciences, applied testing, pharma and molecular diagnostics. We are committed to

customers and their patients to deliver innovative solutions that unlock new insights for scientific research, forensics,

food safety or better treatment decisions. We understand and live up to our responsibility to customers and patients

who depend on us for reliable, efficient and safe workflows.

Customer satisfaction is an integral part of the QIAGEN mission of making improvements in life possible, which is

therefore the direct responsibility of the Chief Executive Officer. Our customers have high expectations on reliability,

safety and the environment-friendly manufacturing of our products. We develop our products and services in close

contact with our customers and incorporate their feedback into our processes.

Our commitment is to continually improve the customer experience, taking into account their evolving needs and

expectations. QIAGEN has established a global systematic approach to measure customer experience in the form of

an aggregated Customer Experience Indicator (CEI). The CEI is measured on a monthly basis through a set of

internal KPIs (product and delivery performance, phone support, etc.) and external customer feedback that are

directly linked to customer experience in our transactions. Thus, we are able to identify quickly and systematically

Payments received from governmentPayments to governmentsFinancial assistance from governmentsYear ended December 31,($ in thousands)201920182017Customer satisfaction1. Anti-corruption questionnaire and certification for new distributors, resellers and agents;

2. Annual risk assessment based on a calculated risk score, which factors location of business (Transparency

International Index Score, TIIS) and annual sales revenue for distributing QIAGEN products by multiplying total

revenues of the prior calendar year with the inverse of the TIIS;

3. Training;

4. Contractual obligations;

5. Due diligence (including selected background checks); also including payment monitoring.

All our policies are available to employees through the company’s Compliance@QIAGEN intranet pages.

Compliance awareness of our employees in all areas of the world is increased by regular trainings, which are held

by external as well as inhouse legal and regulatory experts. In addition, QIAGEN has entered into a long-term online

training program focusing on topics such as antitrust and competition, bribery and corruption, conflicts of interest,

data protection, gifts and entertainment, harassment, insider trading, reporting as well as respectful communication.
Online training reaches all employees in local language, supported by multiple communication resources. New
employees are required to take online training on our Corporate Code of Conduct and Ethics at a minimum.
M A N A G E M E N T   R E P O R T Non-Financial Statement
Additional trainings which are customized to the specific area of responsibility are mandatory. Employees in Sales
and Marketing as well as Upper Management are required to take training on anti-corruption and antitrust laws.
These basic trainings are followed by refresher courses on a regular basis. In 2019, our employees completed more
than 10,000 online training modules. In addition, employees are informed through the company’s
Compliance@QIAGEN intranet page and regular updates on compliance topics via the company’s internal
communication platform Yammer.

We have established a hotline for reporting accounting-related concerns on an anonymous basis in good faith. In
accordance with the U.S. Sarbanes-Oxley Act of 2002 and the listing standards of NYSE, QIAGEN follows as strict
non-retaliation policy. QIAGEN will diligently investigate all such complaints and will protect the anonymity of the
complainant. We also offer a direct e-mail and telephone hotline for employees to address questions or make
suggestions for our Compliance Program.

Our Compliance Program is overseen by the Compliance Committee under the leadership of the Head of Global
Legal Affairs and Compliance, who reports in this function directly to the Audit Committee of the Supervisory Board.
The Compliance Committee consists of managers from Legal, Internal Audit, Human Resources, Commercial
Operations, Trade Compliance and Regulatory functions.

In the reporting period, QIAGEN had no legal actions pending or completed with regard to antitrust or corruption.

Social Matters

QIAGEN’s mission is to make improvements in life possible by enabling our customers to achieve outstanding
success and breakthroughs in life sciences, applied testing, pharma and molecular diagnostics. We are committed to
customers and their patients to deliver innovative solutions that unlock new insights for scientific research, forensics,
food safety or better treatment decisions. We understand and live up to our responsibility to customers and patients
who depend on us for reliable, efficient and safe workflows.

Customer satisfaction is an integral part of the QIAGEN mission of making improvements in life possible, which is
therefore the direct responsibility of the Chief Executive Officer. Our customers have high expectations on reliability,
safety and the environment-friendly manufacturing of our products. We develop our products and services in close
contact with our customers and incorporate their feedback into our processes.

Our commitment is to continually improve the customer experience, taking into account their evolving needs and
expectations. QIAGEN has established a global systematic approach to measure customer experience in the form of
an aggregated Customer Experience Indicator (CEI). The CEI is measured on a monthly basis through a set of
internal KPIs (product and delivery performance, phone support, etc.) and external customer feedback that are
directly linked to customer experience in our transactions. Thus, we are able to identify quickly and systematically

areas for improvement while staying closely connected with our customers. Departmental and employee contribution
to the CEI performance is embedded into our annual goal setting process. After a reworking of the CEI logic and KPI
definitions in 2018 and the launch of a revised CEI 2.0 in January 2019, a Full Year score of 96.331 points (out of
a maximum 100 points) was achieved. This corresponds to 1,517 points with the former CEI logic (2018 score was
1,515 points out of 2,000 maximum). It is a testimony to our continued efforts to increase customer satisfaction.

QIAGEN stands for quality. Since QIAGEN’s founding 30 years ago, we have always been committed to the
highest quality, and we always strive to exceed our customers’ expectations. QIAGEN’s reputation as a quality
supplier is best-in-class in our industry and the foundation of our loyal global customer base. Therefore, we offer a
100% satisfaction guarantee to all our customers. It means that if our customers are not entirely satisfied with the
performance of a QIAGEN product we will exchange or refund it free of charge for the customer.

To achieve and maintain our quality standards, we established Total Quality Management (TQM) systems in all of
our manufacturing facilities around the globe. These assure constant high quality as well as safe and effective
medical devices. QIAGEN’s TQM systems are certified according ISO 9001, ISO 13485, ISO 18385, as well as
21 CFR 820 and all other applicable medical device standards around the globe (see section “Government
Regulations” in the Management Report).

105

QIAGEN products and their components are safe to use by customers as well by our employees in Research and
Development (R&D). We use a list of qualified substances (the “MDx Toolbox”), specifically excluding any substances

of concern. Our transparent and responsible product and development policy also includes the communication and

marketing of products. As with all companies in the medical device/in vitro diagnostics industry, product claims and

product properties are verified and validated during development and approved by regulatory bodies around the

world as part of the product submission process.

QIAGEN, like other companies, is exposed to the financial implications of potential recalls and other adverse events

due to equipment failures, manufacturing defects, design flaws, or inadequate disclosure of product-related risks. In

the event of a recall, QIAGEN has established global procedures applicable to all QIAGEN sites that aim at

avoiding the further use of the product and at guaranteeing cost-neutral procedures for our customers. Processes,

responsibilities and improvement programs are defined as required by regulating authorities to avoid the

reoccurrence of recalls. There is full traceability of each product to the final customer; therefore, any recalls are

executed by direct customer notifications. Due to QIAGEN’s stringent quality management, recalls rarely occur:

2019 (3), 2018 (4), 2017 (0), 2016 (3), 2015 (1). The percentage of affected product is low as well: 2019 (15%),

2018 (0.09%), 2017 (0%), 2016 (0.21%), 2015 (0.022%). In past recalls, 90% to 100% of customers have been

reached and confirmed recall notification.

QIAGEN is aware of the importance of providing access to healthcare and research products around the world. In

developing countries with scarce resources, new ways are needed to ensure access to affordable diagnostics that

play a critical role in helping to prevent and treat diseases. In particular, infectious diseases and various

malignancies can be treated much more cost-effectively through early and precise detection – and with improved

patient outcomes. However, many emerging countries lack properly trained lab personnel and technical infrastructure

to utilize the latest molecular testing technologies.

For QIAGEN, a strategic approach to providing access to diagnostic technologies can yield opportunities for

growth, innovation and unique public-private partnerships. To support our growth strategy in emerging markets, we

are expanding our presence in these markets and adapting our products to local needs, where necessary.

One example is our global effort to advance diagnostics for tuberculosis (TB) in low-resource, high disease burden

countries. Based on a five-year memorandum of understanding signed in 2015, QIAGEN is cooperating with FIND,

an NGO, to develop innovative and affordable tests to detect people with latent TB infections who are at risk of

developing active TB. In October 2019, we also announced the addition of QuantiFERON TB Gold Plus (QFT-Plus) to

the diagnostic catalogue of the Stop TB Partnership’s Global Drug Facility (GDF). The GDF facilitates access and

Customer satisfactionQuality and product safetyAccess to healthcareareas for improvement while staying closely connected with our customers. Departmental and employee contribution
to the CEI performance is embedded into our annual goal setting process. After a reworking of the CEI logic and KPI
definitions in 2018 and the launch of a revised CEI 2.0 in January 2019, a Full Year score of 96.331 points (out of
a maximum 100 points) was achieved. This corresponds to 1,517 points with the former CEI logic (2018 score was
1,515 points out of 2,000 maximum). It is a testimony to our continued efforts to increase customer satisfaction.

QIAGEN stands for quality. Since QIAGEN’s founding 30 years ago, we have always been committed to the
highest quality, and we always strive to exceed our customers’ expectations. QIAGEN’s reputation as a quality
supplier is best-in-class in our industry and the foundation of our loyal global customer base. Therefore, we offer a
100% satisfaction guarantee to all our customers. It means that if our customers are not entirely satisfied with the
performance of a QIAGEN product we will exchange or refund it free of charge for the customer.

To achieve and maintain our quality standards, we established Total Quality Management (TQM) systems in all of
our manufacturing facilities around the globe. These assure constant high quality as well as safe and effective
medical devices. QIAGEN’s TQM systems are certified according ISO 9001, ISO 13485, ISO 18385, as well as
21 CFR 820 and all other applicable medical device standards around the globe (see section “Government
Regulations” in the Management Report).

QIAGEN products and their components are safe to use by customers as well by our employees in Research and
Development (R&D). We use a list of qualified substances (the “MDx Toolbox”), specifically excluding any substances
of concern. Our transparent and responsible product and development policy also includes the communication and
marketing of products. As with all companies in the medical device/in vitro diagnostics industry, product claims and
product properties are verified and validated during development and approved by regulatory bodies around the
world as part of the product submission process.

QIAGEN, like other companies, is exposed to the financial implications of potential recalls and other adverse events
due to equipment failures, manufacturing defects, design flaws, or inadequate disclosure of product-related risks. In
the event of a recall, QIAGEN has established global procedures applicable to all QIAGEN sites that aim at
avoiding the further use of the product and at guaranteeing cost-neutral procedures for our customers. Processes,
responsibilities and improvement programs are defined as required by regulating authorities to avoid the
reoccurrence of recalls. There is full traceability of each product to the final customer; therefore, any recalls are
executed by direct customer notifications. Due to QIAGEN’s stringent quality management, recalls rarely occur:
2019 (3), 2018 (4), 2017 (0), 2016 (3), 2015 (1). The percentage of affected product is low as well: 2019 (15%),
2018 (0.09%), 2017 (0%), 2016 (0.21%), 2015 (0.022%). In past recalls, 90% to 100% of customers have been
reached and confirmed recall notification.

QIAGEN is aware of the importance of providing access to healthcare and research products around the world. In
developing countries with scarce resources, new ways are needed to ensure access to affordable diagnostics that
play a critical role in helping to prevent and treat diseases. In particular, infectious diseases and various
malignancies can be treated much more cost-effectively through early and precise detection – and with improved
patient outcomes. However, many emerging countries lack properly trained lab personnel and technical infrastructure
to utilize the latest molecular testing technologies.

For QIAGEN, a strategic approach to providing access to diagnostic technologies can yield opportunities for
growth, innovation and unique public-private partnerships. To support our growth strategy in emerging markets, we
are expanding our presence in these markets and adapting our products to local needs, where necessary.

One example is our global effort to advance diagnostics for tuberculosis (TB) in low-resource, high disease burden
countries. Based on a five-year memorandum of understanding signed in 2015, QIAGEN is cooperating with FIND,
an NGO, to develop innovative and affordable tests to detect people with latent TB infections who are at risk of
developing active TB. In October 2019, we also announced the addition of QuantiFERON TB Gold Plus (QFT-Plus) to
the diagnostic catalogue of the Stop TB Partnership’s Global Drug Facility (GDF). The GDF facilitates access and

106

Quality and product safetyAccess to healthcareM A N A G E M E N T   R E P O R T Non-Financial Statement

helps match demand for TB diagnostics and drugs with funding from donors, governments and NGOs on a global
scale. The acceptance of QFT-Plus to the GDF catalogue advances our strategy to help expand screening with
modern blood-based assays for latent TB infection in regions with high disease burden but limited resources.

To reach the highest risk populations needing TB testing, QIAGEN is building upon our high-volume state-of-the-art
QuantiFERON-TB Gold Plus assay with the development QuantiFERON-TB Access, a field-friendly test with
ultrasensitive digital detection on a portable device. Launching in 2020, this public health solution has already
gained recognition by the Joint United Nations Program on HIV/AIDS.

A further example is the development of careHPV as an adaptation of our gold standard digene HC2 test for
detection of high-risk human papillomavirus (HPV), which has been shown to be the primary cause of cervical
cancer. In cooperation with PATH, an NGO, and support from the Bill & Melinda Gates Foundation, QIAGEN
developed this dedicated testing system for use in regions with limited healthcare resources. The main advantages of
decentralized HPV testing are:

›

immediate analysis at the point of care

›

instant treatment decisions

›

higher compliance of patients

Our careHPV Test is currently available in more than 25 countries worldwide. Since its launch through the end of
2019, more than 3 million tests have been distributed.

107

Management Report
Management Report

Business and Operating Environment
Future Perspectives

QIAGEN is a global leader in Sample to Insight solutions that transform biological samples into valuable molecular
QIAGEN Perspectives for 2020
insights. Our mission is to enable customers across the continuum of molecular testing to unlock valuable insights
faster, better and more efficiently - from the raw biological sample to the final interpreted result.
The COVID-19 pandemic will have a significant impact on QIAGEN in 2020. Exatrordinary demand has emerged
for molecular technologies involved in the testing for the new pathogen. However, the overall impact is not
predictable at this point, as the spike in demand comes at the same time as demand for other products has waned
We serve more than 500,000 customers in two broad customer groups: Molecular Diagnostics (human healthcare)
due to the quarantines and other actions in many countries around the world that have disrupted the broader
and Life Sciences (academia, pharma R&D and industrial applications, primarily forensics). Proven QIAGEN
economy and routine healthcare.
solutions and content are providing answers in hospitals and laboratories worldwide, helping make sense of the
increasing volumes and complexity of biological information, in keeping with our vision of making improvements in
life possible.
Global Economic Perspectives for 2020

The world's economic perspectives for 2020 are impossible to predict at this time given the COVID-19 pandemic.
QIAGEN began operations in 1986 as a pioneer in the emerging biotechnology sector, introducing a novel method
that standardized and accelerated extraction and purification of nucleic acids from biological samples. As molecular
biology and genomic knowledge have grown to influence many areas of life, QIAGEN has expanded to serve the
Industry Perspectives for 2020
full spectrum of market needs. We believe our sample technologies are unmatched in quality for isolating and
preparing DNA (deoxyribonucleic acid), RNA (ribonucleic acid) and proteins from blood or other liquids, tissue,
Molecular testing solutions are seen as an essential component of the broad medical response to the COVID-19
plants or other materials. Our assay technologies amplify, enrich and make these biomolecules accessible for
pandemic. QIAGEN is committed to dramatically ramping up production capacity of its solutions that can be used
analysis, such as identifying the genetic information of a pathogen or a gene mutation in a tumor. QIAGEN’s
for SARS-CoV-2 testing and support the overall response to this public health emergency.
industry-leading Digital Insights solutions allow users to analyze and interpret data with bioinformatics software and
knowledge bases to provide relevant, actionable insights. Our automation systems tie these technologies together in
Subsequent Events
seamless and cost-effective molecular testing workflows - from Sample to Insight.

On March 3, 2020, QIAGEN and Thermo Fisher Scientific Inc. (NYSE: TMO) announced that their boards of
Net sales of $1.53 billion in 2019 consisted of consumable kits and other revenues (89% of sales) and automation
directors, as well as the managing board of QIAGEN N.V., unanimously approved Thermo Fisher’s proposal to
systems and instruments (11% of sales). Approximately 48% of net sales in 2019 were in Molecular Diagnostics, and
acquire QIAGEN for €39 per share in cash. The offer price represents a premium of approximately 23% to the
52% in Life Sciences customer classes in the Academia / Applied Testing and Pharma markets.
closing price of QIAGEN’s common stock on the Frankfurt Prime Standard on March 2, 2020, the last trading day
prior to the announcement of the transaction. Thermo Fisher will commence a tender offer to acquire all of the
ordinary shares of QIAGEN. The transaction values QIAGEN at approximately $11.5 billion at current exchange
QIAGEN has grown by developing new instruments, consumables and digital solutions to meet diverse and growing
rates, which includes the assumption of approximately $1.4 billion of net debt. The transaction, which is expected to
needs in the market, partnering with researchers and Pharma companies, and acquiring companies or technologies
be completed in the first half of 2021, is subject to the satisfaction of customary closing conditions, including the
to complement our portfolio. We believe the addressable global market for QIAGEN's portfolio of molecular testing
receipt of applicable regulatory approvals, the adoption of certain resolutions relating to the transaction at an
products for customers across the continuum of life science research and molecular diagnostics totals more than $10
Extraordinary General Meeting of QIAGEN’s shareholders, and completion of the tender offer. Thermo Fisher has
billion.
obtained committed bridge financing. Permanent funding is expected to come from cash on hand and the issuance
of new debt. The transaction is not subject to any financing condition.
We have funded our growth through internally generated funds, debt offerings, and private and public sales of
equity securities. QIAGEN’s global shares are listed on the New York Stock Exchange under the ticker symbol
In March 2020, the Supervisory Board and the Managing Board resolved in a Joint Meeting to propose Thierry
QGEN and on the Frankfurt Prime Standard as QIA.
Bernard, who has been with QIAGEN since 2015, for election as Chief Executive Officer and a Managing Director
at the next Annual General Meeting, which is set to take place in June 2020, along with the re-election of Roland
The company is registered under its commercial and legal name QIAGEN N.V. with the trade register (kamer van
Sackers as Chief Financial Officer and a Managing Director. The Joint Meeting further resolved to propose the
koophandel) of the Dutch region Limburg Noord under file number 12036979. QIAGEN N.V. is a public limited
current members of the Supervisory Board to all stand for re-election: Håkan Björklund, Stéphane Bancel, Metin
liability company (naamloze vennootschap) under Dutch law as a holding company. Our principal executive office is
Colpan, Elaine Mardis, Lawrence Rosen and Elizabeth Tallett.
located at Hulsterweg 82, 5912 PL Venlo, The Netherlands, and our telephone number is +31-77-355-6600.

As a holding company, QIAGEN conducts business through subsidiaries located throughout the world. Further
information about QIAGEN can be found at www.QIAGEN.com. By referring to our website, we do not incorporate
the website or any portion of the website by reference into this Annual Report.

108

M A N A G E M E N T   R E P O R T

Future Perspectives

109

M A N A G E M E N T   R E P O R T

Future Perspectives

Corporate 
Governance 
and  
Compensation

106 Corporate Structure

107 Managing Board

108 Supervisory Board

118 Share Ownership

119 Additional Information

111

Governance
Governance

Corporate Governance Report
Corporate Governance Report
We recognize the importance of clear and straightforward rules on corporate 
We recognize the importance of clear and straightforward rules on corporate governance and, where appropriate,
governance and, where appropriate, have adapted our internal organization 
have adapted our internal organization and processes to these rules. This section provides an overview of QIAGEN’s
We recognize the importance of clear and straightforward rules on corporate governance and, where appropriate,
and processes to these rules. This section provides an overview of QIAGEN’s 
corporate governance structure and includes details of the information required under the Dutch Corporate
have adapted our internal organization and processes to these rules. This section provides an overview of QIAGEN’s
Governance Code (the Dutch Code). The Dutch Code is applicable to QIAGEN N.V. (in the following also referred
corporate governance structure and includes details of the information required under the Dutch Corporate
corporate governance structure and includes details of the information required 
Governance
to as the “Company”), as it is a publicly listed company incorporated under the laws of The Netherlands with a
Governance Code (the Dutch Code). The Dutch Code is applicable to QIAGEN N.V. (in the following also referred
under the Dutch Corporate Governance Code (the Dutch Code). The Dutch 
registered seat in Venlo, The Netherlands. The Dutch Code contains the principles and concrete provisions which the
to as the “Company”), as it is a publicly listed company incorporated under the laws of The Netherlands with a
Code is applicable to QIAGEN N.V. (in the following also referred to as the 
persons involved in a listed company (including Managing Board members and Supervisory Board members) and
registered seat in Venlo, The Netherlands. The Dutch Code contains the principles and concrete provisions which the
“Company”), as it is a publicly listed company incorporated under the laws of 
stakeholders should observe in relation to one another.
persons involved in a listed company (including Managing Board members and Supervisory Board members) and
Corporate Governance Report
stakeholders should observe in relation to one another.
The Netherlands with a registered seat in Venlo, The Netherlands. The Dutch 
Our corporate governance practices generally derive from the provisions of the Dutch Civil Code and the Dutch
Code contains the principles and concrete provisions which the persons involved 
Corporate Governance Code. Further, due to our listing on the New York Stock Exchange in the U.S., the Managing
Our corporate governance practices generally derive from the provisions of the Dutch Civil Code and the Dutch
We recognize the importance of clear and straightforward rules on corporate governance and, where appropriate,
in a listed company (including Managing Board members and Supervisory 
Board and the Supervisory Board of QIAGEN N.V. declared their intention to disclose in QIAGEN’s Annual Reports
Corporate Governance Code. Further, due to our listing on the New York Stock Exchange in the U.S., the Managing
have adapted our internal organization and processes to these rules. This section provides an overview of QIAGEN’s
Board members) and stakeholders should observe in relation to one another.
the Company’s compliance with the corporate governance practices followed by U.S. companies under the New
Board and the Supervisory Board of QIAGEN N.V. declared their intention to disclose in QIAGEN’s Annual Reports
corporate governance structure and includes details of the information required under the Dutch Corporate
York Stock Exchange listing standards or state the deviations recorded in the period.
the Company’s compliance with the corporate governance practices followed by U.S. companies under the New
Governance Code (the Dutch Code). The Dutch Code is applicable to QIAGEN N.V. (in the following also referred
to as the “Company”), as it is a publicly listed company incorporated under the laws of The Netherlands with a
York Stock Exchange listing standards or state the deviations recorded in the period.
Our corporate governance practices generally derive from the provisions of the 
registered seat in Venlo, The Netherlands. The Dutch Code contains the principles and concrete provisions which the
A brief summary of the principal differences follows.
Dutch Civil Code and the Dutch Corporate Governance Code. Further, due to 
persons involved in a listed company (including Managing Board members and Supervisory Board members) and
A brief summary of the principal differences follows.
our listing on the New York Stock Exchange in the U.S., the Managing Board 
stakeholders should observe in relation to one another.
Corporate Structure
and the Supervisory Board of QIAGEN N.V. declared their intention to disclose 
Corporate Structure
Our corporate governance practices generally derive from the provisions of the Dutch Civil Code and the Dutch
in QIAGEN’s Annual Reports the Company’s compliance with the corporate 
QIAGEN is a ‘Naamloze Vennootschap,’ or N.V., a Dutch public limited liability company similar to a corporation
Corporate Governance Code. Further, due to our listing on the New York Stock Exchange in the U.S., the Managing
in the United States. QIAGEN has a two-tier board structure. QIAGEN is managed by a Managing Board consisting
QIAGEN is a ‘Naamloze Vennootschap,’ or N.V., a Dutch public limited liability company similar to a corporation
governance practices followed by U.S. companies under the New York Stock 
Board and the Supervisory Board of QIAGEN N.V. declared their intention to disclose in QIAGEN’s Annual Reports
of executive management acting under the supervision of a Supervisory Board (non-executives), similar to a Board of
in the United States. QIAGEN has a two-tier board structure. QIAGEN is managed by a Managing Board consisting
the Company’s compliance with the corporate governance practices followed by U.S. companies under the New
Exchange listing standards or state the deviations recorded in the period.
Directors in a U.S. corporation. It is in the interest of QIAGEN and all its stakeholders that each Board performs its
of executive management acting under the supervision of a Supervisory Board (non-executives), similar to a Board of
York Stock Exchange listing standards or state the deviations recorded in the period.
functions appropriately and that there is a clear division of responsibilities between the Managing Board, the
Directors in a U.S. corporation. It is in the interest of QIAGEN and all its stakeholders that each Board performs its
A brief summary of the principal differences follows.
Supervisory Board, the general meeting of shareholders (General Meeting) and the external auditor in a well-
functions appropriately and that there is a clear division of responsibilities between the Managing Board, the
A brief summary of the principal differences follows.
functioning system of checks and balances.
Supervisory Board, the general meeting of shareholders (General Meeting) and the external auditor in a well-
functioning system of checks and balances.
Corporate Structure
Managing Board
Managing Board
QIAGEN is a ‘Naamloze Vennootschap,’ or N.V., a Dutch public limited liability company similar to a corporation
in the United States. QIAGEN has a two-tier board structure. QIAGEN is managed by a Managing Board consisting
of executive management acting under the supervision of a Supervisory Board (non-executives), similar to a Board of
The Managing Board manages QIAGEN and is responsible for defining and achieving QIAGEN’s aims, strategy,
Directors in a U.S. corporation. It is in the interest of QIAGEN and all its stakeholders that each Board performs its
policies and results and is expected to act in a sustainable manner by focusing on long-term value creation in the
The Managing Board manages QIAGEN and is responsible for defining and achieving QIAGEN’s aims, strategy,
functions appropriately and that there is a clear division of responsibilities between the Managing Board, the
performance of their work. The Managing Board is also responsible for complying with all relevant legislation and
policies and results and is expected to act in a sustainable manner by focusing on long-term value creation in the
Supervisory Board, the general meeting of shareholders (General Meeting) and the external auditor in a well-
regulations as well as for managing the risks associated with the business activities and the financing of QIAGEN. It
performance of their work. The Managing Board is also responsible for complying with all relevant legislation and
functioning system of checks and balances.
reports related developments to and discusses the internal risk management and control systems with the Supervisory
regulations as well as for managing the risks associated with the business activities and the financing of QIAGEN. It
Board and the Audit Committee. Under Dutch Law, QIAGEN's Managing Board, which has two members, has
reports related developments to and discusses the internal risk management and control systems with the Supervisory
Managing Board
chosen to work with an Executive Committee and is accountable for the actions and decisions of the Executive
Board and the Audit Committee. Under Dutch Law, QIAGEN's Managing Board, which has two members, has
Committee, which is comprised of the CEO, the CFO and certain experienced leaders who have responsibilities for
chosen to work with an Executive Committee and is accountable for the actions and decisions of the Executive
the operational management of the Company and the achievement of its objectives and results. The Managing Board
Committee, which is comprised of the CEO, the CFO and certain experienced leaders who have responsibilities for
The Managing Board manages QIAGEN and is responsible for defining and achieving QIAGEN’s aims, strategy,
has ultimate responsibility for the Company’s external reporting and is answerable to shareholders of the Company
the operational management of the Company and the achievement of its objectives and results. The Managing Board
policies and results and is expected to act in a sustainable manner by focusing on long-term value creation in the
at the Annual General Meeting of Shareholders. Pursuant to the two-tier corporate structure, the Managing Board is
has ultimate responsibility for the Company’s external reporting and is answerable to shareholders of the Company
performance of their work. The Managing Board is also responsible for complying with all relevant legislation and
required to render account for the performance of its duties to the Supervisory Board and the General Meeting of
at the Annual General Meeting of Shareholders. Pursuant to the two-tier corporate structure, the Managing Board is
regulations as well as for managing the risks associated with the business activities and the financing of QIAGEN. It
Shareholders (General Meeting). The Managing Board provides the Supervisory Board with timely information
required to render account for the performance of its duties to the Supervisory Board and the General Meeting of
reports related developments to and discusses the internal risk management and control systems with the Supervisory
necessary for the exercise of the duties of the Supervisory Board. In discharging its duties, the Managing Board takes
Shareholders (General Meeting). The Managing Board provides the Supervisory Board with timely information
Board and the Audit Committee. Under Dutch Law, QIAGEN's Managing Board, which has two members, has
necessary for the exercise of the duties of the Supervisory Board. In discharging its duties, the Managing Board takes
chosen to work with an Executive Committee and is accountable for the actions and decisions of the Executive
Committee, which is comprised of the CEO, the CFO and certain experienced leaders who have responsibilities for
the operational management of the Company and the achievement of its objectives and results. The Managing Board
has ultimate responsibility for the Company’s external reporting and is answerable to shareholders of the Company
112
at the Annual General Meeting of Shareholders. Pursuant to the two-tier corporate structure, the Managing Board is
required to render account for the performance of its duties to the Supervisory Board and the General Meeting of

Shareholders (General Meeting). The Managing Board provides the Supervisory Board with timely information

necessary for the exercise of the duties of the Supervisory Board. In discharging its duties, the Managing Board takes

GeneralGeneralGeneralGovernance

Corporate Governance Report

We recognize the importance of clear and straightforward rules on corporate governance and, where appropriate,

have adapted our internal organization and processes to these rules. This section provides an overview of QIAGEN’s

corporate governance structure and includes details of the information required under the Dutch Corporate

Governance Code (the Dutch Code). The Dutch Code is applicable to QIAGEN N.V. (in the following also referred

to as the “Company”), as it is a publicly listed company incorporated under the laws of The Netherlands with a

registered seat in Venlo, The Netherlands. The Dutch Code contains the principles and concrete provisions which the

persons involved in a listed company (including Managing Board members and Supervisory Board members) and

stakeholders should observe in relation to one another.

Our corporate governance practices generally derive from the provisions of the Dutch Civil Code and the Dutch

Corporate Governance Code. Further, due to our listing on the New York Stock Exchange in the U.S., the Managing

Board and the Supervisory Board of QIAGEN N.V. declared their intention to disclose in QIAGEN’s Annual Reports

the Company’s compliance with the corporate governance practices followed by U.S. companies under the New

York Stock Exchange listing standards or state the deviations recorded in the period.

A brief summary of the principal differences follows.

Corporate Structure

QIAGEN is a ‘Naamloze Vennootschap,’ or N.V., a Dutch public limited liability company similar to a corporation

in the United States. QIAGEN has a two-tier board structure. QIAGEN is managed by a Managing Board consisting

of executive management acting under the supervision of a Supervisory Board (non-executives), similar to a Board of

Directors in a U.S. corporation. It is in the interest of QIAGEN and all its stakeholders that each Board performs its

functions appropriately and that there is a clear division of responsibilities between the Managing Board, the

Supervisory Board, the general meeting of shareholders (General Meeting) and the external auditor in a well-

functioning system of checks and balances.

Managing Board

Corporate Governance Report
C O R P O R AT E   G O V E R N A N C E   A N D   C O M P E N S AT I O N
The Managing Board manages QIAGEN and is responsible for defining and achieving QIAGEN’s aims, strategy,
policies and results and is expected to act in a sustainable manner by focusing on long-term value creation in the
performance of their work. The Managing Board is also responsible for complying with all relevant legislation and
regulations as well as for managing the risks associated with the business activities and the financing of QIAGEN. It
reports related developments to and discusses the internal risk management and control systems with the Supervisory
Board and the Audit Committee. Under Dutch Law, QIAGEN's Managing Board, which has two members, has
chosen to work with an Executive Committee and is accountable for the actions and decisions of the Executive
Committee, which is comprised of the CEO, the CFO and certain experienced leaders who have responsibilities for
the operational management of the Company and the achievement of its objectives and results. The Managing Board
has ultimate responsibility for the Company’s external reporting and is answerable to shareholders of the Company
at the Annual General Meeting of Shareholders. Pursuant to the two-tier corporate structure, the Managing Board is
required to render account for the performance of its duties to the Supervisory Board and the General Meeting of
Shareholders (General Meeting). The Managing Board provides the Supervisory Board with timely information
necessary for the exercise of the duties of the Supervisory Board. In discharging its duties, the Managing Board takes
into account the interests of QIAGEN, its enterprises and all parties involved in QIAGEN, including shareholders and
other stakeholders.

The Managing Board consists of one or more members as determined by the Supervisory Board. The members of the
Managing Board are appointed by the General Meeting upon the joint meeting of the Supervisory Board and the
Managing Board (the Joint Meeting) having made a binding nomination for each vacancy. However, the General
Meeting may at all times overrule the binding nature of such a nomination by a resolution adopted by at least a two-
thirds majority of the votes cast, if such majority represents more than half the issued share capital. Managing
Directors are appointed annually for the period beginning on the date following the Annual General Meeting up to
and including the date of the Annual General Meeting held in the following year.

Members of the Managing Board may be suspended and dismissed by the General Meeting by a resolution adopted
by a two-thirds majority of the votes cast, if such majority represents more than half of the issued share capital, unless
the proposal was made by the Joint Meeting, in which case a simple majority of votes cast is sufficient. Furthermore,
the Supervisory Board may at any time suspend (but not dismiss) a member of the Managing Board.

Our Managing Directors and interim CEO for the year ended December 31, 2019 and their ages as of January 31,
2020, are as follows:

Thierry Bernard

Roland Sackers

55

51

Interim Chief Executive Officer and Senior Vice President, Head of Molecular Diagnostics Business Area

Managing Director, Chief Financial Officer

(1) The contract for Peer M. Schatz as Managing Director and Chief Executive Officer concluded effective September 30, 2019.
Mr. Schatz continues as a Senior Advisor until June 30, 2021.

The following is a brief summary of the background of each of the Managing Directors. References to “QIAGEN”
and the “Company” in relation to periods prior to April 29, 1996 mean QIAGEN GmbH and its consolidated
subsidiaries:

, 55, joined QIAGEN in February 2015 to lead QIAGEN’s growing presence in Molecular

Diagnostics, the application of Sample to Insight solutions for molecular testing in human healthcare. In October
2019, Mr. Bernard was named Interim Chief Executive Officer in addition to his prior role as Senior Vice President,
Head of Molecular Diagnostics Business Area. In March 2020, Mr. Bernard was named Chief Executive Officer. Mr.
Bernard previously worked at bioMérieux, where he served in roles of increasing responsibility for 15 years, most
recently as Corporate Vice President, Global Commercial Operations, Investor Relations and the Greater China
Region. Prior to joining bioMérieux, he served in management roles in multiple international environments. Mr.
Bernard is a member of the boards of directors of three privately held U.S. companies, First Light Biosciences,
HepatoChem and more recently, Daktari Diagnostics, where he also served as CEO. He has earned degrees from
Sciences Po (Paris), Harvard Business School, London School of Economics and the College of Europe and is a
member of French Foreign Trade Advisors.

, 51, joined QIAGEN in 1999 as Vice President Finance and has been Chief Financial Officer since
2004. In 2006, Mr. Sackers became a member of the Managing Board. Between 1995 and 1999, he served as an
auditor with Arthur Andersen Wirtschaftsprüfungsgesellschaft Steuerberatungsgesellschaft. Mr. Sackers earned his
Diplom-Kaufmann from University of Münster, Germany. In 2019, he joined the supervisory board of Evotec SE and
is chairman of the audit committee. He is a former member of the supervisory board and audit committee of IBS AG

113

and a former member of the board of directors of Operon Biotechnologies, Inc. Mr. Sackers is a board member of

the industry association BIO Deutschland. He was previously a non-executive director and chair of the audit

committee from 2011 to 2018 of Immunodiagnostic Systems Holding PLC (IDS), a leading producer of

immunological tests for research and diagnostic applications publicly listed in the United Kingdom.

GeneralComposition and AppointmentManaging Directors and Interim Chief Executive Officer:Thierry BernardRoland SackershName (1)AgePositioninto account the interests of QIAGEN, its enterprises and all parties involved in QIAGEN, including shareholders and

other stakeholders.

The Managing Board consists of one or more members as determined by the Supervisory Board. The members of the

Managing Board are appointed by the General Meeting upon the joint meeting of the Supervisory Board and the

Managing Board (the Joint Meeting) having made a binding nomination for each vacancy. However, the General

Meeting may at all times overrule the binding nature of such a nomination by a resolution adopted by at least a two-

thirds majority of the votes cast, if such majority represents more than half the issued share capital. Managing

Directors are appointed annually for the period beginning on the date following the Annual General Meeting up to

and including the date of the Annual General Meeting held in the following year.

Members of the Managing Board may be suspended and dismissed by the General Meeting by a resolution adopted

by a two-thirds majority of the votes cast, if such majority represents more than half of the issued share capital, unless

the proposal was made by the Joint Meeting, in which case a simple majority of votes cast is sufficient. Furthermore,

the Supervisory Board may at any time suspend (but not dismiss) a member of the Managing Board.

Our Managing Directors and interim CEO for the year ended December 31, 2019 and their ages as of January 31,

2020, are as follows:

Thierry Bernard

Interim Chief Executive Officer and Senior Vice President, Head of Molecular Diagnostics Business Area

Roland Sackers

Managing Director, Chief Financial Officer

55

51

(1) The contract for Peer M. Schatz as Managing Director and Chief Executive Officer concluded effective September 30, 2019.

Mr. Schatz continues as a Senior Advisor until June 30, 2021.

The following is a brief summary of the background of each of the Managing Directors. References to “QIAGEN”

and the “Company” in relation to periods prior to April 29, 1996 mean QIAGEN GmbH and its consolidated

subsidiaries:

, 55, joined QIAGEN in February 2015 to lead QIAGEN’s growing presence in Molecular

Diagnostics, the application of Sample to Insight solutions for molecular testing in human healthcare. In October

2019, Mr. Bernard was named Interim Chief Executive Officer in addition to his prior role as Senior Vice President,
Head of Molecular Diagnostics Business Area. In March 2020, Mr. Bernard was named Chief Executive Officer. Mr.
Bernard previously worked at bioMérieux, where he served in roles of increasing responsibility for 15 years, most
recently as Corporate Vice President, Global Commercial Operations, Investor Relations and the Greater China
Region. Prior to joining bioMérieux, he served in management roles in multiple international environments. Mr.
Bernard is a member of the boards of directors of three privately held U.S. companies, First Light Biosciences,
HepatoChem and more recently, Daktari Diagnostics, where he also served as CEO. He has earned degrees from
Sciences Po (Paris), Harvard Business School, London School of Economics and the College of Europe and is a
member of French Foreign Trade Advisors.

, 51, joined QIAGEN in 1999 as Vice President Finance and has been Chief Financial Officer since
2004. In 2006, Mr. Sackers became a member of the Managing Board. Between 1995 and 1999, he served as an
auditor with Arthur Andersen Wirtschaftsprüfungsgesellschaft Steuerberatungsgesellschaft. Mr. Sackers earned his
Diplom-Kaufmann from University of Münster, Germany. In 2019, he joined the supervisory board of Evotec SE and
is chairman of the audit committee. He is a former member of the supervisory board and audit committee of IBS AG
and a former member of the board of directors of Operon Biotechnologies, Inc. Mr. Sackers is a board member of
the industry association BIO Deutschland. He was previously a non-executive director and chair of the audit
committee from 2011 to 2018 of Immunodiagnostic Systems Holding PLC (IDS), a leading producer of
immunological tests for research and diagnostic applications publicly listed in the United Kingdom.

, 54, joined QIAGEN in 1993 and served as Chief Executive Officer from January 1, 2004 until

September 30, 2019. He was Chief Financial Officer between 1993 and 2003 and became a member of the
Managing Board in 1998. Mr. Schatz’s contract as Managing Director and Chief Executive Officer concluded
effective September 30, 2019 and he continues as a Senior Advisor until June 30, 2021.

Resolutions to enter into transactions under which members of the Managing Board could have a conflict of interest
with QIAGEN, and which are of material significance to QIAGEN and/or the relevant member of the Managing
Board, require the approval of the Supervisory Board. QIAGEN has not entered into any such transactions in 2019.
No credit, loans or similar benefits were granted to members of the Managing Board. Additionally, the Managing
Board Members did not receive any benefits from third parties that were either promised or granted in view of their
position as members of the Managing Board.

Supervisory Board

The Supervisory Board supervises the policies of the Managing Board, the general course of QIAGEN’s affairs and
the manner in which the Managing Board implements the long-term value creation strategy and the business
enterprises which we operate. The Supervisory Board assists the Managing Board by providing advice relating to the
business activities of QIAGEN. In December 31, 2019, the Supervisory Board had five regular meetings that were
held with the attendance of the Managing Board, while certain agenda items were discussed exclusively between the
Supervisory Board members. In discharging its duties, the Supervisory Board takes into account the interests of
QIAGEN, its enterprise and all parties involved in QIAGEN, including shareholders and other stakeholders. The
Supervisory Board is responsible for the quality of its own performance. In this respect, the Supervisory Board
conducts a self-evaluation on an annual basis. Our Supervisory Board has specified matters requiring its approval,
including decisions and actions which would fundamentally change the company’s assets, financial position or
results of operations. The Supervisory Board has appointed an Audit Committee, a Compensation Committee, a
Selection and Appointment (Nomination) Committee and a Science and Technology Committee from among its
members and can appoint other committees as deemed beneficial. The Supervisory Board has approved charters
pursuant to which each of the committees operates.

The Supervisory Board consists of at least three members, or a larger number as determined by the Joint Meeting.
Members of the Supervisory Board are appointed by the General Meeting upon the Joint Meeting having made a
binding nomination for each vacancy. However, the General Meeting may at all times overrule the binding nature of
such a nomination by a resolution adopted by at least a two-thirds majority of the votes cast, if such majority
represents more than half the issued share capital.

The Supervisory Board shall be composed in a way that enables it to carry out its duties properly and enables its
members to act critically and independently of one another and of the Managing Board and any particular interests.
To that effect, the Supervisory Board has adopted a profile of its size and composition that takes into account the
114
nature of our business, our activities and the desired diversity, expertise and background of the members of the
Supervisory Board. The current profile of the Supervisory Board can be found on our website. The Supervisory Board

has appointed a chairman from its members who has the duties assigned to him by the Articles of Association and

the Dutch Code.

Members of the Supervisory Board are appointed annually for the period beginning on the date following the

General Meeting up to and including the date of the General Meeting held in the following year. Members of the

Supervisory Board may be suspended and dismissed by the General Meeting by a resolution adopted by a two-

thirds majority of the votes cast, if such majority represents more than half of the issued share capital, unless the

proposal was made by the Managing Board and the Supervisory Board in which case a simple majority of votes cast

is sufficient.

Composition and AppointmentManaging Directors and Interim Chief Executive Officer:Thierry BernardRoland SackershName (1)AgePositionPeer M. SchatzConflicts of Interest, Loans or Similar BenefitsGeneralComposition and Appointment, 54, joined QIAGEN in 1993 and served as Chief Executive Officer from January 1, 2004 until

September 30, 2019. He was Chief Financial Officer between 1993 and 2003 and became a member of the

Managing Board in 1998. Mr. Schatz’s contract as Managing Director and Chief Executive Officer concluded

effective September 30, 2019 and he continues as a Senior Advisor until June 30, 2021.

Resolutions to enter into transactions under which members of the Managing Board could have a conflict of interest

with QIAGEN, and which are of material significance to QIAGEN and/or the relevant member of the Managing

Board, require the approval of the Supervisory Board. QIAGEN has not entered into any such transactions in 2019.

No credit, loans or similar benefits were granted to members of the Managing Board. Additionally, the Managing

Board Members did not receive any benefits from third parties that were either promised or granted in view of their

position as members of the Managing Board.

Supervisory Board

The Supervisory Board supervises the policies of the Managing Board, the general course of QIAGEN’s affairs and

the manner in which the Managing Board implements the long-term value creation strategy and the business

enterprises which we operate. The Supervisory Board assists the Managing Board by providing advice relating to the

business activities of QIAGEN. In December 31, 2019, the Supervisory Board had five regular meetings that were

held with the attendance of the Managing Board, while certain agenda items were discussed exclusively between the

Supervisory Board members. In discharging its duties, the Supervisory Board takes into account the interests of

QIAGEN, its enterprise and all parties involved in QIAGEN, including shareholders and other stakeholders. The

Supervisory Board is responsible for the quality of its own performance. In this respect, the Supervisory Board

conducts a self-evaluation on an annual basis. Our Supervisory Board has specified matters requiring its approval,

including decisions and actions which would fundamentally change the company’s assets, financial position or

results of operations. The Supervisory Board has appointed an Audit Committee, a Compensation Committee, a

Selection and Appointment (Nomination) Committee and a Science and Technology Committee from among its

members and can appoint other committees as deemed beneficial. The Supervisory Board has approved charters

pursuant to which each of the committees operates.

C O R P O R AT E   G O V E R N A N C E   A N D   C O M P E N S AT I O N

Corporate Governance Report

The Supervisory Board consists of at least three members, or a larger number as determined by the Joint Meeting.
Members of the Supervisory Board are appointed by the General Meeting upon the Joint Meeting having made a
binding nomination for each vacancy. However, the General Meeting may at all times overrule the binding nature of
such a nomination by a resolution adopted by at least a two-thirds majority of the votes cast, if such majority
represents more than half the issued share capital.

The Supervisory Board shall be composed in a way that enables it to carry out its duties properly and enables its
members to act critically and independently of one another and of the Managing Board and any particular interests.
To that effect, the Supervisory Board has adopted a profile of its size and composition that takes into account the
nature of our business, our activities and the desired diversity, expertise and background of the members of the
Supervisory Board. The current profile of the Supervisory Board can be found on our website. The Supervisory Board
has appointed a chairman from its members who has the duties assigned to him by the Articles of Association and
the Dutch Code.

Members of the Supervisory Board are appointed annually for the period beginning on the date following the
General Meeting up to and including the date of the General Meeting held in the following year. Members of the
Supervisory Board may be suspended and dismissed by the General Meeting by a resolution adopted by a two-
thirds majority of the votes cast, if such majority represents more than half of the issued share capital, unless the
proposal was made by the Managing Board and the Supervisory Board in which case a simple majority of votes cast
is sufficient.

Our Supervisory Directors for the year ended December 31, 2019 and their ages as of January 31, 2020, are as
follows:

Stéphane Bancel

47

French

Male

Supervisory Director, Member of the Compensation Committee, Audit Committee and Science and
Technology Committee

Dr. Håkan Björklund

63

Swedish

Male

Chair of the Supervisory Board, Member of the Compensation Committee and Selection and
Appointment Committee

Dr. Metin Colpan

65 German

Male

Supervisory Director, Chair of the Science and Technology Committee and Member of the
Selection and Appointment Committee

Dr. Ross L. Levine

48

U.S.

Male

Supervisory Director and Member of the Science and Technology Committee

Dr. Elaine Mardis

57

U.S.

Female Supervisory Director and Member of the Science and Technology Committee

Lawrence A. Rosen

62

U.S.

Male

Supervisory Director and Chair of the Audit Committee

Elizabeth E. Tallett

70

U.S.

Female Supervisory Director, Chair of the Compensation Committee, Member of the Audit Committee and

Member of the Selection and Appointment Committee

The following is a brief summary of the background of each of the Supervisory Directors. References to “QIAGEN”
and the “Company” in relation to periods prior to April 29, 1996 mean QIAGEN GmbH and its consolidated
subsidiaries:

, 47, joined the Supervisory Board as well as the Compensation Committee in 2013 and joined the
Audit Committee and Science and Technology Committee in 2014. He is Chief Executive Officer of Moderna, Inc., a
clinical-stage biotechnology company based in Cambridge, Massachusetts, which is advancing 24 drug
development programs involving messenger RNA therapeutics. Before joining Moderna, Mr. Bancel served for five
years as Chief Executive Officer of the French diagnostics company bioMérieux SA. Prior to bioMérieux, he was
Managing Director of Eli Lilly in Belgium and Executive Director of Global Manufacturing Strategy and Supply Chain
at Eli Lilly in Indianapolis, Indiana, after having started at Lilly in Great Britain. Before joining Eli Lilly, Mr. Bancel
served as Asia-Pacific Sales and Marketing Director for bioMérieux while based in Tokyo, Japan. He holds a Master
of Engineering degree from École Centrale Paris (ECP), a Master of Science in Chemical Engineering from the
University of Minnesota and an M.B.A. from Harvard Business School.

, 63, was appointed as a Supervisory Board Member in March 2017 and as Chair of the

Supervisory Board in June 2018. He is a member of the Compensation Committee and the Selection and
Appointment Committee. Dr. Björklund brings an extensive international background in the life science industry to
QIAGEN, in particular through his current role as Operating Executive at Avista Capital Partners, as well as through
previous roles as CEO of the global pharmaceutical company Nycomed, Regional Director at Astra (now

115

AstraZeneca), President of Astra Draco and Operating Executive at Avista Capital Partners. Under Dr. Björklund’s

leadership, Nycomed grew from a predominantly Scandinavian business into a global pharmaceutical company. In

addition to QIAGEN, he currently serves as Chairman of the Board of Directors of OneMed Top Holding AB and

Swedish Orphan Biovitrum AB (Sobi) and as a Member of the Board of Directors of BONESUPPORT AB and Tellacq

AB. Dr. Björklund earlier served as Chairman of the Board of Directors of Acino International AG and Lundbeck A/S,

and was also a Member of the Board of Directors of several international life science companies, including Alere,

Atos, Coloplast and Danisco. Dr. Björklund has a Ph.D. in Neuroscience from Karolinska Institutet in Sweden.

, 65, is a co-founder of QIAGEN and was the Chief Executive Officer and a Managing Director

from 1985 through 2003. Dr. Colpan has been a member of the Supervisory Board since 2004 and has served as

Chair of the Science and Technology Committee since 2014. He has been a member of the Selection and

Appointment Committee since 2015. Dr. Colpan obtained his Ph.D. and M.S. in Organic Chemistry and Chemical

Engineering from the Darmstadt Institute of Technology in 1983. Prior to founding QIAGEN, Dr. Colpan was an

Assistant Investigator at the Institute for Biophysics at the University of Düsseldorf. Dr. Colpan has had wide

experience in separation techniques and in the separation and purification of nucleic acids in particular, and has

filed many patents in the field. Dr. Colpan also serves as a Supervisory Board member of CGR GmbH in Mettmann,

Peer M. SchatzConflicts of Interest, Loans or Similar BenefitsGeneralComposition and AppointmentSupervisory DirectorsStéphane BancelDr. Håkan BjörklundDr. Metin ColpanNameAgeNationalityGenderPositionOur Supervisory Directors for the year ended December 31, 2019 and their ages as of January 31, 2020, are as

follows:

Stéphane Bancel

47

French

Male

Supervisory Director, Member of the Compensation Committee, Audit Committee and Science and

Dr. Håkan Björklund

63

Swedish

Male

Chair of the Supervisory Board, Member of the Compensation Committee and Selection and

Technology Committee

Appointment Committee

Dr. Metin Colpan

65 German

Male

Supervisory Director, Chair of the Science and Technology Committee and Member of the

Selection and Appointment Committee

Dr. Ross L. Levine

48

U.S.

Male

Supervisory Director and Member of the Science and Technology Committee

Dr. Elaine Mardis

57

U.S.

Female Supervisory Director and Member of the Science and Technology Committee

Lawrence A. Rosen

62

U.S.

Male

Supervisory Director and Chair of the Audit Committee

Elizabeth E. Tallett

70

U.S.

Female Supervisory Director, Chair of the Compensation Committee, Member of the Audit Committee and

Member of the Selection and Appointment Committee

The following is a brief summary of the background of each of the Supervisory Directors. References to “QIAGEN”

and the “Company” in relation to periods prior to April 29, 1996 mean QIAGEN GmbH and its consolidated

subsidiaries:

, 47, joined the Supervisory Board as well as the Compensation Committee in 2013 and joined the

Audit Committee and Science and Technology Committee in 2014. He is Chief Executive Officer of Moderna, Inc., a
clinical-stage biotechnology company based in Cambridge, Massachusetts, which is advancing 24 drug
development programs involving messenger RNA therapeutics. Before joining Moderna, Mr. Bancel served for five
years as Chief Executive Officer of the French diagnostics company bioMérieux SA. Prior to bioMérieux, he was
Managing Director of Eli Lilly in Belgium and Executive Director of Global Manufacturing Strategy and Supply Chain
at Eli Lilly in Indianapolis, Indiana, after having started at Lilly in Great Britain. Before joining Eli Lilly, Mr. Bancel
served as Asia-Pacific Sales and Marketing Director for bioMérieux while based in Tokyo, Japan. He holds a Master
of Engineering degree from École Centrale Paris (ECP), a Master of Science in Chemical Engineering from the
University of Minnesota and an M.B.A. from Harvard Business School.

, 63, was appointed as a Supervisory Board Member in March 2017 and as Chair of the

Supervisory Board in June 2018. He is a member of the Compensation Committee and the Selection and
Appointment Committee. Dr. Björklund brings an extensive international background in the life science industry to
QIAGEN, in particular through his current role as Operating Executive at Avista Capital Partners, as well as through
previous roles as CEO of the global pharmaceutical company Nycomed, Regional Director at Astra (now
AstraZeneca), President of Astra Draco and Operating Executive at Avista Capital Partners. Under Dr. Björklund’s
leadership, Nycomed grew from a predominantly Scandinavian business into a global pharmaceutical company. In
addition to QIAGEN, he currently serves as Chairman of the Board of Directors of OneMed Top Holding AB and
Swedish Orphan Biovitrum AB (Sobi) and as a Member of the Board of Directors of BONESUPPORT AB and Tellacq
AB. Dr. Björklund earlier served as Chairman of the Board of Directors of Acino International AG and Lundbeck A/S,
and was also a Member of the Board of Directors of several international life science companies, including Alere,
Atos, Coloplast and Danisco. Dr. Björklund has a Ph.D. in Neuroscience from Karolinska Institutet in Sweden.

, 65, is a co-founder of QIAGEN and was the Chief Executive Officer and a Managing Director

from 1985 through 2003. Dr. Colpan has been a member of the Supervisory Board since 2004 and has served as
Chair of the Science and Technology Committee since 2014. He has been a member of the Selection and
Appointment Committee since 2015. Dr. Colpan obtained his Ph.D. and M.S. in Organic Chemistry and Chemical
Engineering from the Darmstadt Institute of Technology in 1983. Prior to founding QIAGEN, Dr. Colpan was an
Assistant Investigator at the Institute for Biophysics at the University of Düsseldorf. Dr. Colpan has had wide
experience in separation techniques and in the separation and purification of nucleic acids in particular, and has
filed many patents in the field. Dr. Colpan also serves as a Supervisory Board member of CGR GmbH in Mettmann,
Germany and Heilpflanzenwohl AG in Baar, Germany. Dr. Colpan previously served as a Supervisory Board
member of Ingenium Pharmaceuticals AG, GenPat77 Pharmacogenetics AG, GPC Biotech AG and Morphosys AG,
each in Munich, Germany and Qalovis Farmer Automatic Energy GmbH, in Laer, Germany.

, 48, joined the Supervisory Board and its Science and Technology Committee in 2016. He is a

physician-scientist focused on researching and treating blood and bone marrow cancers as the Laurence Joseph
Dineen Chair in Leukemia Research, the Chief of Molecular Cancer Medicine, and an Attending Physician at
Memorial Sloan Kettering Cancer Center, as well as Professor of Medicine at Weill Cornell Medical College. He
leads a research lab investigating genetics and targeted therapies in myeloid malignancies and is interested in
application of next-generation sequencing technology in the practice of medicine in hematologic cancers. He trained
in internal medicine at Massachusetts General Hospital and in hematology-oncology at the Dana-Farber Cancer
Institute, earning board certification in these specialties. He received his M.D. from the Johns Hopkins University
School of Medicine and his A.B. degree from Harvard College.

, 57, joined the Supervisory Board and its Science and Technology Committee in 2014. Dr.
Mardis is the Co-Executive Director of the Institute for Genomic Medicine at Nationwide Children’s Hospital in
Columbus, OH. She also is Professor of Pediatrics at the Ohio State University College of Medicine. Dr. Mardis has
research interests in the application of genomic technologies to improve our understanding of human disease, and
toward improving the precision of medical diagnosis, prognosis and treatment. Dr. Mardis is the former Robert E.
and Louise F. Dunn Distinguished Professor of Medicine at Washington University School of Medicine in St. Louis,
MO, where she was on the faculty for 22 years. As Co-Director of the McDonnell Genome Institute, she devised
methods and automation that contributed to the Human Genome Project and has since played key roles in the 1000
Genomes Project, The Cancer Genome Atlas, and the Pediatric Cancer Genome Project. Prior to joining the
Washington University faculty, she was a senior research scientist at BioRad Laboratories in Hercules, CA. Dr.
Mardis is a board member of the American Association for Cancer Research, and has scientific advisory roles at
Kiadis Pharmaceuticals N.V., PACT Pharma LLC, and Interpreta LLC. Dr. Mardis received her Bachelor of Science
degree in Zoology in 1984 and her Ph.D. in Chemistry and Biochemistry in 1989, both from the University of
Oklahoma.

, 62, joined the Supervisory Board as well as the Audit Committee in 2013, and has served as

the committee's Chair since 2014. Mr. Rosen was a member of the Board of Management and Chief Financial
Officer of Deutsche Post DHL until September 2016. Holding this position since 2009, Mr. Rosen was in charge of
116
controlling, corporate accounting and reporting, investor relations, corporate finance, corporate internal audit and
security, taxes, as well as the group’s global business services. Prior to joining Deutsche Post DHL, Mr. Rosen served
as Chief Financial Officer of Fresenius Medical Care AG & Co. KGaA in Germany from 2003 to 2009. Prior to that,

he was Senior Vice President and Treasurer for Aventis SA in Strasbourg, France. Between 1984 and 2000, Mr.

Rosen held different positions at the Aventis predecessor companies Hoechst AG and American Hoechst/Hoechst

Celanese Inc. Since 2015, Mr. Rosen has served as a member of the board of Lanxess AG and previously served on

the board of Postbank AG from 2009 until 2015. Mr. Rosen, who is a U.S. citizen, holds a Bachelor's degree in

Economics from the State University of New York and an M.B.A. from the University of Michigan.

, 70, joined the Supervisory Board, as well as the Audit Committee and Compensation

Committee, in 2011. She has served since 2016 as Chair of the Compensation Committee. She is a member of the

Selection and Appointment Committee. Ms. Tallett was a Principal of Hunter Partners, LLC, a management company

for early to mid-stage pharmaceutical, biotechnology and medical device companies, from 2002 until February

2015. Ms. Tallett continues to consult with early stage health care companies. Her senior management experience

includes President and CEO of Transcell Technologies Inc., President of Centocor Pharmaceuticals, member of the

Parke-Davis Executive Committee, and Director of Worldwide Strategic Planning for Warner-Lambert Company. Ms.

Tallett graduated from Nottingham University, England with dual Bachelor's degrees with honors in mathematics and

economics. She is a member of the board of directors of Anthem, Inc. (where she is currently Chair), Principal

Financial Group, Inc., and Meredith Corp. She is a former director of Coventry Health Care, Inc. Ms. Tallett was a

founding board member of the Biotechnology Council of New Jersey and is Chair of the Trustees of Solebury School

in Pennsylvania.

Supervisory DirectorsStéphane BancelDr. Håkan BjörklundDr. Metin ColpanNameAgeNationalityGenderPositionDr. Ross L. LevineDr. Elaine MardisLawrence A. RosenElizabeth E. TallettConflicts of Interest, Loans or Similar BenefitsGermany and Heilpflanzenwohl AG in Baar, Germany. Dr. Colpan previously served as a Supervisory Board

member of Ingenium Pharmaceuticals AG, GenPat77 Pharmacogenetics AG, GPC Biotech AG and Morphosys AG,

each in Munich, Germany and Qalovis Farmer Automatic Energy GmbH, in Laer, Germany.

, 48, joined the Supervisory Board and its Science and Technology Committee in 2016. He is a

physician-scientist focused on researching and treating blood and bone marrow cancers as the Laurence Joseph

Dineen Chair in Leukemia Research, the Chief of Molecular Cancer Medicine, and an Attending Physician at

Memorial Sloan Kettering Cancer Center, as well as Professor of Medicine at Weill Cornell Medical College. He

leads a research lab investigating genetics and targeted therapies in myeloid malignancies and is interested in

application of next-generation sequencing technology in the practice of medicine in hematologic cancers. He trained

in internal medicine at Massachusetts General Hospital and in hematology-oncology at the Dana-Farber Cancer

Institute, earning board certification in these specialties. He received his M.D. from the Johns Hopkins University

School of Medicine and his A.B. degree from Harvard College.

, 57, joined the Supervisory Board and its Science and Technology Committee in 2014. Dr.

Mardis is the Co-Executive Director of the Institute for Genomic Medicine at Nationwide Children’s Hospital in

Columbus, OH. She also is Professor of Pediatrics at the Ohio State University College of Medicine. Dr. Mardis has

research interests in the application of genomic technologies to improve our understanding of human disease, and

toward improving the precision of medical diagnosis, prognosis and treatment. Dr. Mardis is the former Robert E.

and Louise F. Dunn Distinguished Professor of Medicine at Washington University School of Medicine in St. Louis,
MO, where she was on the faculty for 22 years. As Co-Director of the McDonnell Genome Institute, she devised
methods and automation that contributed to the Human Genome Project and has since played key roles in the 1000
C O R P O R AT E   G O V E R N A N C E   A N D   C O M P E N S AT I O N
Genomes Project, The Cancer Genome Atlas, and the Pediatric Cancer Genome Project. Prior to joining the
Washington University faculty, she was a senior research scientist at BioRad Laboratories in Hercules, CA. Dr.
Mardis is a board member of the American Association for Cancer Research, and has scientific advisory roles at
Kiadis Pharmaceuticals N.V., PACT Pharma LLC, and Interpreta LLC. Dr. Mardis received her Bachelor of Science
degree in Zoology in 1984 and her Ph.D. in Chemistry and Biochemistry in 1989, both from the University of
Oklahoma.

Corporate Governance Report

, 62, joined the Supervisory Board as well as the Audit Committee in 2013, and has served as

the committee's Chair since 2014. Mr. Rosen was a member of the Board of Management and Chief Financial
Officer of Deutsche Post DHL until September 2016. Holding this position since 2009, Mr. Rosen was in charge of
controlling, corporate accounting and reporting, investor relations, corporate finance, corporate internal audit and
security, taxes, as well as the group’s global business services. Prior to joining Deutsche Post DHL, Mr. Rosen served
as Chief Financial Officer of Fresenius Medical Care AG & Co. KGaA in Germany from 2003 to 2009. Prior to that,
he was Senior Vice President and Treasurer for Aventis SA in Strasbourg, France. Between 1984 and 2000, Mr.
Rosen held different positions at the Aventis predecessor companies Hoechst AG and American Hoechst/Hoechst
Celanese Inc. Since 2015, Mr. Rosen has served as a member of the board of Lanxess AG and previously served on
the board of Postbank AG from 2009 until 2015. Mr. Rosen, who is a U.S. citizen, holds a Bachelor's degree in
Economics from the State University of New York and an M.B.A. from the University of Michigan.

, 70, joined the Supervisory Board, as well as the Audit Committee and Compensation

Committee, in 2011. She has served since 2016 as Chair of the Compensation Committee. She is a member of the
Selection and Appointment Committee. Ms. Tallett was a Principal of Hunter Partners, LLC, a management company
for early to mid-stage pharmaceutical, biotechnology and medical device companies, from 2002 until February
2015. Ms. Tallett continues to consult with early stage health care companies. Her senior management experience
includes President and CEO of Transcell Technologies Inc., President of Centocor Pharmaceuticals, member of the
Parke-Davis Executive Committee, and Director of Worldwide Strategic Planning for Warner-Lambert Company. Ms.
Tallett graduated from Nottingham University, England with dual Bachelor's degrees with honors in mathematics and
economics. She is a member of the board of directors of Anthem, Inc. (where she is currently Chair), Principal
Financial Group, Inc., and Meredith Corp. She is a former director of Coventry Health Care, Inc. Ms. Tallett was a
founding board member of the Biotechnology Council of New Jersey and is Chair of the Trustees of Solebury School
in Pennsylvania.

Resolutions to enter into transactions under which members of the Supervisory Board could have a conflict of interest
with QIAGEN, and which are of material significance to QIAGEN and/or the relevant member of the Supervisory
Board, must be reported and require the approval of the Supervisory Board plenum. A Supervisory Director that has
a personal conflict of interest will not participate in the decision making process regarding such item. In December
31, 2019 neither QIAGEN nor its Supervisory Board members have entered into any such transactions. No credit,
loans or similar benefits were granted to members of the Supervisory Board. Additionally, the Supervisory Board
Members did not receive any benefits from third parties that were either promised or granted in view of their position
as members of the Supervisory Board.

The Supervisory Board has established an Audit Committee, a Compensation Committee, a Selection and
Appointment Committee and a Science and Technology Committee from among its members and can establish other
committees as deemed beneficial. The Supervisory Board has approved charters under which each of the committees
operates. These charters are published on our website www.QIAGEN.com. The committees are comprised of the
following members:

Stéphane Bancel

•

Dr. Håkan Björklund

•

•

Dr. Metin Colpan

Dr. Ross L. Levine

Dr. Elaine Mardis

Lawrence A. Rosen

•
(Chairman)

Elizabeth E. Tallett

•

•

(Chairwoman)

•
(Chairman)

•

•

•

•
(Chairman)

•

•

117

We believe that all of our Supervisory Directors meet the independence requirements set forth in the Dutch Corporate

Governance Code (the Dutch Code). We further believe that all Supervisory Board Directors qualify as independent

under the independence standards set forth in the New York Stock Exchange (NYSE) Listed Company Manual.

Pursuant to the NYSE rules, a majority of the Supervisory Directors must qualify as independent, as defined in the

Rules.

The Audit Committee currently consists of three members, Mr. Rosen (Chair), Ms. Tallett and Mr. Bancel, and meets

at least quarterly. The Audit Committee members are appointed by the Supervisory Board and serve for a term of

one year. We believe that all members of our Audit Committee meet the independence requirements as set forth in

Rule 10A-3 of the Securities Exchange Act of 1934, as amended, and the New York Stock Exchange Listed

Company Manual. The Board has designated Mr. Rosen as an “audit committee financial expert” as that term is

defined in the United States Securities and Exchange Commission rules adopted pursuant to the Sarbanes-Oxley Act

of 2002 and as defined in provisions III.3.2 and III.5.7 of the Dutch Code. The Audit Committee performs a self-

evaluation of its activities on an annual basis.

The Audit Committee's primary duties and responsibilities include, among other things, to serve as an independent

and objective party to monitor QIAGEN's accounting and financial reporting process and internal risk management,

control and compliance systems. The Audit Committee also is directly responsible for proposing the external auditor

to the Supervisory Board, which then proposes the appointment of the external auditor to the General Meeting.

Further, the Audit Committee is responsible for the compensation and oversight of QIAGEN’s external auditor and for

providing an open avenue of communication among the external auditor as well as the Managing Board and the

Supervisory Board. Our Internal Audit department operates under the direct responsibility of the Audit Committee.

Further, the Audit Committee is responsible to establish procedures to allow for the confidential and or anonymous

Dr. Ross L. LevineDr. Elaine MardisLawrence A. RosenElizabeth E. TallettConflicts of Interest, Loans or Similar BenefitsCommittees of the Supervisory BoardAudit CommitteeName of SupervisoryDirectorMember of AuditCommitteeMember of CompensationCommitteeMember of Selection and AppointmentCommitteeMember of Science and TechnologyCommitteeResolutions to enter into transactions under which members of the Supervisory Board could have a conflict of interest

Resolutions to enter into transactions under which members of the Supervisory Board could have a conflict of interest

Resolutions to enter into transactions under which members of the Supervisory Board could have a conflict of interest

Resolutions to enter into transactions under which members of the Supervisory Board could have a conflict of interest

Resolutions to enter into transactions under which members of the Supervisory Board could have a conflict of interest

with QIAGEN, and which are of material significance to QIAGEN and/or the relevant member of the Supervisory

with QIAGEN, and which are of material significance to QIAGEN and/or the relevant member of the Supervisory

with QIAGEN, and which are of material significance to QIAGEN and/or the relevant member of the Supervisory

with QIAGEN, and which are of material significance to QIAGEN and/or the relevant member of the Supervisory

with QIAGEN, and which are of material significance to QIAGEN and/or the relevant member of the Supervisory

Board, must be reported and require the approval of the Supervisory Board plenum. A Supervisory Director that has

Board, must be reported and require the approval of the Supervisory Board plenum. A Supervisory Director that has

Board, must be reported and require the approval of the Supervisory Board plenum. A Supervisory Director that has

Board, must be reported and require the approval of the Supervisory Board plenum. A Supervisory Director that has

Board, must be reported and require the approval of the Supervisory Board plenum. A Supervisory Director that has

a personal conflict of interest will not participate in the decision making process regarding such item. In December

a personal conflict of interest will not participate in the decision making process regarding such item. In December

a personal conflict of interest will not participate in the decision making process regarding such item. In December

a personal conflict of interest will not participate in the decision making process regarding such item. In December

a personal conflict of interest will not participate in the decision making process regarding such item. In December

31, 2019 neither QIAGEN nor its Supervisory Board members have entered into any such transactions. No credit,

31, 2019 neither QIAGEN nor its Supervisory Board members have entered into any such transactions. No credit,

31, 2019 neither QIAGEN nor its Supervisory Board members have entered into any such transactions. No credit,

31, 2019 neither QIAGEN nor its Supervisory Board members have entered into any such transactions. No credit,

31, 2019 neither QIAGEN nor its Supervisory Board members have entered into any such transactions. No credit,

loans or similar benefits were granted to members of the Supervisory Board. Additionally, the Supervisory Board

loans or similar benefits were granted to members of the Supervisory Board. Additionally, the Supervisory Board

loans or similar benefits were granted to members of the Supervisory Board. Additionally, the Supervisory Board

loans or similar benefits were granted to members of the Supervisory Board. Additionally, the Supervisory Board

loans or similar benefits were granted to members of the Supervisory Board. Additionally, the Supervisory Board

Members did not receive any benefits from third parties that were either promised or granted in view of their position

Members did not receive any benefits from third parties that were either promised or granted in view of their position

Members did not receive any benefits from third parties that were either promised or granted in view of their position

Members did not receive any benefits from third parties that were either promised or granted in view of their position

Members did not receive any benefits from third parties that were either promised or granted in view of their position

as members of the Supervisory Board.

as members of the Supervisory Board.

as members of the Supervisory Board.

as members of the Supervisory Board.

as members of the Supervisory Board.

The Supervisory Board has established an Audit Committee, a Compensation Committee, a Selection and
The Supervisory Board has established an Audit Committee, a Compensation Committee, a Selection and
The Supervisory Board has established an Audit Committee, a Compensation Committee, a Selection and
The Supervisory Board has established an Audit Committee, a Compensation Committee, a Selection and
The Supervisory Board has established an Audit Committee, a Compensation Committee, a Selection and
Appointment Committee and a Science and Technology Committee from among its members and can establish other
Appointment Committee and a Science and Technology Committee from among its members and can establish other
Appointment Committee and a Science and Technology Committee from among its members and can establish other
Appointment Committee and a Science and Technology Committee from among its members and can establish other
Appointment Committee and a Science and Technology Committee from among its members and can establish other
committees as deemed beneficial. The Supervisory Board has approved charters under which each of the committees
committees as deemed beneficial. The Supervisory Board has approved charters under which each of the committees
committees as deemed beneficial. The Supervisory Board has approved charters under which each of the committees
committees as deemed beneficial. The Supervisory Board has approved charters under which each of the committees
committees as deemed beneficial. The Supervisory Board has approved charters under which each of the committees
operates. These charters are published on our website www.QIAGEN.com. The committees are comprised of the
operates. These charters are published on our website www.QIAGEN.com. The committees are comprised of the
operates. These charters are published on our website www.QIAGEN.com. The committees are comprised of the
operates. These charters are published on our website www.QIAGEN.com. The committees are comprised of the
operates. These charters are published on our website www.QIAGEN.com. The committees are comprised of the
following members:
following members:
following members:
following members:
following members:

•

•

•

•

•

•

•

•

•

•

•

•

•

•

•

Stéphane Bancel

Stéphane Bancel

Stéphane Bancel

Stéphane Bancel

Stéphane Bancel

Dr. Håkan Björklund

Dr. Håkan Björklund

Dr. Håkan Björklund

Dr. Håkan Björklund

Dr. Håkan Björklund

Dr. Metin Colpan

Dr. Metin Colpan

Dr. Metin Colpan

Dr. Metin Colpan

Dr. Metin Colpan

Dr. Ross L. Levine

Dr. Ross L. Levine

Dr. Ross L. Levine

Dr. Ross L. Levine

Dr. Ross L. Levine

Dr. Elaine Mardis

Dr. Elaine Mardis

Dr. Elaine Mardis

Dr. Elaine Mardis

Dr. Elaine Mardis

Lawrence A. Rosen

Lawrence A. Rosen

Lawrence A. Rosen

Lawrence A. Rosen

Lawrence A. Rosen

•
(Chairman)

•
•
•
(Chairman)
(Chairman)
(Chairman)

•
(Chairman)

Elizabeth E. Tallett

Elizabeth E. Tallett

Elizabeth E. Tallett

Elizabeth E. Tallett

Elizabeth E. Tallett

•

•

•

•

•

•
(Chairwoman)

•
(Chairwoman)

•
•
(Chairwoman)
(Chairwoman)

•
(Chairwoman)

•

•

•

•

•

•
(Chairman)

•
•
•
(Chairman)
(Chairman)
(Chairman)

•
(Chairman)

•

•

•

•

•

•

•

•

•

•

•
(Chairman)

•
•
•
(Chairman)
(Chairman)
(Chairman)

•
(Chairman)

•

•

•

•

•

•

•

•

•

•

We believe that all of our Supervisory Directors meet the independence requirements set forth in the Dutch Corporate
We believe that all of our Supervisory Directors meet the independence requirements set forth in the Dutch Corporate
We believe that all of our Supervisory Directors meet the independence requirements set forth in the Dutch Corporate
We believe that all of our Supervisory Directors meet the independence requirements set forth in the Dutch Corporate
We believe that all of our Supervisory Directors meet the independence requirements set forth in the Dutch Corporate
Governance Code (the Dutch Code). We further believe that all Supervisory Board Directors qualify as independent
Governance Code (the Dutch Code). We further believe that all Supervisory Board Directors qualify as independent
Governance Code (the Dutch Code). We further believe that all Supervisory Board Directors qualify as independent
Governance Code (the Dutch Code). We further believe that all Supervisory Board Directors qualify as independent
Governance Code (the Dutch Code). We further believe that all Supervisory Board Directors qualify as independent
under the independence standards set forth in the New York Stock Exchange (NYSE) Listed Company Manual.
under the independence standards set forth in the New York Stock Exchange (NYSE) Listed Company Manual.
under the independence standards set forth in the New York Stock Exchange (NYSE) Listed Company Manual.
under the independence standards set forth in the New York Stock Exchange (NYSE) Listed Company Manual.
under the independence standards set forth in the New York Stock Exchange (NYSE) Listed Company Manual.
Pursuant to the NYSE rules, a majority of the Supervisory Directors must qualify as independent, as defined in the
Pursuant to the NYSE rules, a majority of the Supervisory Directors must qualify as independent, as defined in the
Pursuant to the NYSE rules, a majority of the Supervisory Directors must qualify as independent, as defined in the
Pursuant to the NYSE rules, a majority of the Supervisory Directors must qualify as independent, as defined in the
Pursuant to the NYSE rules, a majority of the Supervisory Directors must qualify as independent, as defined in the
Rules.
Rules.
Rules.
Rules.
Rules.

The Audit Committee currently consists of three members, Mr. Rosen (Chair), Ms. Tallett and Mr. Bancel, and meets
The Audit Committee currently consists of three members, Mr. Rosen (Chair), Ms. Tallett and Mr. Bancel, and meets
The Audit Committee currently consists of three members, Mr. Rosen (Chair), Ms. Tallett and Mr. Bancel, and meets
The Audit Committee currently consists of three members, Mr. Rosen (Chair), Ms. Tallett and Mr. Bancel, and meets
The Audit Committee currently consists of three members, Mr. Rosen (Chair), Ms. Tallett and Mr. Bancel, and meets
at least quarterly. The Audit Committee members are appointed by the Supervisory Board and serve for a term of
at least quarterly. The Audit Committee members are appointed by the Supervisory Board and serve for a term of
at least quarterly. The Audit Committee members are appointed by the Supervisory Board and serve for a term of
at least quarterly. The Audit Committee members are appointed by the Supervisory Board and serve for a term of
at least quarterly. The Audit Committee members are appointed by the Supervisory Board and serve for a term of
one year. We believe that all members of our Audit Committee meet the independence requirements as set forth in
one year. We believe that all members of our Audit Committee meet the independence requirements as set forth in
one year. We believe that all members of our Audit Committee meet the independence requirements as set forth in
one year. We believe that all members of our Audit Committee meet the independence requirements as set forth in
one year. We believe that all members of our Audit Committee meet the independence requirements as set forth in
Rule 10A-3 of the Securities Exchange Act of 1934, as amended, and the New York Stock Exchange Listed
Rule 10A-3 of the Securities Exchange Act of 1934, as amended, and the New York Stock Exchange Listed
Rule 10A-3 of the Securities Exchange Act of 1934, as amended, and the New York Stock Exchange Listed
Rule 10A-3 of the Securities Exchange Act of 1934, as amended, and the New York Stock Exchange Listed
Rule 10A-3 of the Securities Exchange Act of 1934, as amended, and the New York Stock Exchange Listed
Company Manual. The Board has designated Mr. Rosen as an “audit committee financial expert” as that term is
Company Manual. The Board has designated Mr. Rosen as an “audit committee financial expert” as that term is
Company Manual. The Board has designated Mr. Rosen as an “audit committee financial expert” as that term is
Company Manual. The Board has designated Mr. Rosen as an “audit committee financial expert” as that term is
Company Manual. The Board has designated Mr. Rosen as an “audit committee financial expert” as that term is
defined in the United States Securities and Exchange Commission rules adopted pursuant to the Sarbanes-Oxley Act
defined in the United States Securities and Exchange Commission rules adopted pursuant to the Sarbanes-Oxley Act
defined in the United States Securities and Exchange Commission rules adopted pursuant to the Sarbanes-Oxley Act
defined in the United States Securities and Exchange Commission rules adopted pursuant to the Sarbanes-Oxley Act
defined in the United States Securities and Exchange Commission rules adopted pursuant to the Sarbanes-Oxley Act
of 2002 and as defined in provisions III.3.2 and III.5.7 of the Dutch Code. The Audit Committee performs a self-
of 2002 and as defined in provisions III.3.2 and III.5.7 of the Dutch Code. The Audit Committee performs a self-
of 2002 and as defined in provisions III.3.2 and III.5.7 of the Dutch Code. The Audit Committee performs a self-
of 2002 and as defined in provisions III.3.2 and III.5.7 of the Dutch Code. The Audit Committee performs a self-
of 2002 and as defined in provisions III.3.2 and III.5.7 of the Dutch Code. The Audit Committee performs a self-
evaluation of its activities on an annual basis.
evaluation of its activities on an annual basis.
evaluation of its activities on an annual basis.
evaluation of its activities on an annual basis.
evaluation of its activities on an annual basis.

The Audit Committee's primary duties and responsibilities include, among other things, to serve as an independent
The Audit Committee's primary duties and responsibilities include, among other things, to serve as an independent
The Audit Committee's primary duties and responsibilities include, among other things, to serve as an independent
The Audit Committee's primary duties and responsibilities include, among other things, to serve as an independent
The Audit Committee's primary duties and responsibilities include, among other things, to serve as an independent
and objective party to monitor QIAGEN's accounting and financial reporting process and internal risk management,
and objective party to monitor QIAGEN's accounting and financial reporting process and internal risk management,
and objective party to monitor QIAGEN's accounting and financial reporting process and internal risk management,
and objective party to monitor QIAGEN's accounting and financial reporting process and internal risk management,
and objective party to monitor QIAGEN's accounting and financial reporting process and internal risk management,
control and compliance systems. The Audit Committee also is directly responsible for proposing the external auditor
control and compliance systems. The Audit Committee also is directly responsible for proposing the external auditor
control and compliance systems. The Audit Committee also is directly responsible for proposing the external auditor
control and compliance systems. The Audit Committee also is directly responsible for proposing the external auditor
control and compliance systems. The Audit Committee also is directly responsible for proposing the external auditor
to the Supervisory Board, which then proposes the appointment of the external auditor to the General Meeting.
to the Supervisory Board, which then proposes the appointment of the external auditor to the General Meeting.
to the Supervisory Board, which then proposes the appointment of the external auditor to the General Meeting.
to the Supervisory Board, which then proposes the appointment of the external auditor to the General Meeting.
to the Supervisory Board, which then proposes the appointment of the external auditor to the General Meeting.
Further, the Audit Committee is responsible for the compensation and oversight of QIAGEN’s external auditor and for
Further, the Audit Committee is responsible for the compensation and oversight of QIAGEN’s external auditor and for
Further, the Audit Committee is responsible for the compensation and oversight of QIAGEN’s external auditor and for
Further, the Audit Committee is responsible for the compensation and oversight of QIAGEN’s external auditor and for
Further, the Audit Committee is responsible for the compensation and oversight of QIAGEN’s external auditor and for
providing an open avenue of communication among the external auditor as well as the Managing Board and the
providing an open avenue of communication among the external auditor as well as the Managing Board and the
providing an open avenue of communication among the external auditor as well as the Managing Board and the
providing an open avenue of communication among the external auditor as well as the Managing Board and the
providing an open avenue of communication among the external auditor as well as the Managing Board and the
Supervisory Board. Our Internal Audit department operates under the direct responsibility of the Audit Committee.
Supervisory Board. Our Internal Audit department operates under the direct responsibility of the Audit Committee.
Supervisory Board. Our Internal Audit department operates under the direct responsibility of the Audit Committee.
Supervisory Board. Our Internal Audit department operates under the direct responsibility of the Audit Committee.
Supervisory Board. Our Internal Audit department operates under the direct responsibility of the Audit Committee.
Further, the Audit Committee is responsible to establish procedures to allow for the confidential and or anonymous
Further, the Audit Committee is responsible to establish procedures to allow for the confidential and or anonymous
Further, the Audit Committee is responsible to establish procedures to allow for the confidential and or anonymous
Further, the Audit Committee is responsible to establish procedures to allow for the confidential and or anonymous
Further, the Audit Committee is responsible to establish procedures to allow for the confidential and or anonymous
submission by employees of concerns. Additionally, this includes the receipt, retention and treatment of submissions
received regarding accounting, internal accounting controls, or auditing matters. The Audit Committee discusses our
financial accounting and reporting principles and policies and the adequacy of our internal accounting, financial
and operating controls and procedures with the external auditor and management; considers and approves any
recommendations regarding changes to our accounting policies and processes; reviews with management and the
external auditor our quarterly earnings reports prior to their release to the press; and reviews the quarterly and
annual reports (reported on Forms 6-K and 20-F) to be furnished to or filed with the Securities and Exchange
Commission and the Deutsche Boerse as well as the half-year and annual reports filed with The Netherlands
Authority for the Financial Markets. The Audit Committee met seven times in 2019 and met with the external auditor
excluding members of the Managing Board in July and October 2019. The Audit Committee reviews major financial
risk exposures, pre-approves related-party transactions between the Company and Supervisory Board or Managing
Board, and reviews any legal matter including compliance topics that could have a significant impact on the
financial statements.

118
The Compensation Committee’s primary duties and responsibilities include, among other things, the preparation of a
proposal for the Supervisory Board concerning the Remuneration Policy for the Managing Board to be adopted by
the General Meeting, the preparation of a proposal concerning the individual compensation of Managing Board

members to be adopted by the Supervisory Board and the preparation of the Remuneration Report on compensation

policies for the Managing Board to be adopted by the Supervisory Board. The Compensation Committee reviews

and approves all equity-based compensation, reviews and approves the annual salaries, bonuses and other benefits

of executive officers, and reviews general policies relating to employee compensation and benefits. The

Remuneration Report reviews the implementation of the Remuneration Policy in the most recent year and provides an

outline of the Remuneration Policy for the future. The Compensation Committee engages external consultants to

ensure that the overall remuneration levels are benchmarked regularly, against a selected group of companies and

key markets in which QIAGEN operates. The Compensation Committee currently consists of three members, Ms.

Tallett (Chair), Mr. Bancel and Dr. Björklund. Members are appointed by the Supervisory Board and serve for a term

of one year. The Compensation Committee met five times in December 31, 2019.

The Selection and Appointment (Nomination) Committee is primarily responsible for the preparation of selection

criteria and appointment procedures for members of the Supervisory Board and Managing Board as well as the

periodic evaluation of the scope and composition of the Managing Board and the Supervisory Board, including the

profile of the Supervisory Board. Additionally, the Selection and Appointment Committee periodically evaluates the

functioning of individual members of the Managing Board and Supervisory Board, reporting these results to our

Supervisory Board. It also proposes the (re-)appointments of members of our Managing Board and Supervisory

Board and supervises the policy of our Managing Board in relation to selection and appointment criteria for senior

management. Current members of the Selection and Appointment Committee are Dr. Björklund (Chair), Dr. Colpan

and Ms. Tallett. Members are appointed by the Supervisory Board and serve for a one-year term. In the context of

the 2019 departure of the Chief Executive Officer, the Chair of the Supervisory Board invited all members of the

Supervisory Board to participate in the resulting succession process. Consequently, these matters were discussed

during Supervisory Board meetings and teleconferences and not in the forum of the Selection and Appointment

committee, which did not formally meet in December 31, 2019.

The Science and Technology Committee is primarily responsible for reviewing and monitoring research and

development projects, programs, budgets, infrastructure management and overseeing the management risks related

to the Company's portfolio and information technology platforms. The Science and Technology Committee provides

understanding, clarification and validation of the fundamental technical basis of the Company's businesses in order

to enable the Supervisory Board to make informed, strategic business decisions and vote on related matters, and to

guide the Managing Board to ensure that powerful, global, world-class science is developed, practiced and

leveraged throughout the Company to create shareholder value. The current members of the Science and Technology

Committee are Dr. Colpan (Chair), Dr. Levine, Mr. Bancel and Dr. Mardis. Members are appointed by the

Supervisory Board and serve for a term of one year. The Science and Technology Committee met four times in

December 31, 2019.

Committees of the Supervisory BoardAudit CommitteeName of SupervisoryDirectorMember of AuditCommitteeMember of CompensationCommitteeMember of Selection and AppointmentCommitteeMember of Science and TechnologyCommitteeCompensation CommitteeSelection and Appointment CommitteeScience and Technology CommitteeCommittees of the Supervisory BoardAudit CommitteeName of SupervisoryDirectorMember of AuditCommitteeMember of CompensationCommitteeMember of Selection and AppointmentCommitteeMember of Science and TechnologyCommitteeCommittees of the Supervisory BoardAudit CommitteeName of SupervisoryDirectorMember of AuditCommitteeMember of CompensationCommitteeMember of Selection and AppointmentCommitteeMember of Science and TechnologyCommitteeCommittees of the Supervisory BoardAudit CommitteeName of SupervisoryDirectorMember of AuditCommitteeMember of CompensationCommitteeMember of Selection and AppointmentCommitteeMember of Science and TechnologyCommitteeCommittees of the Supervisory BoardAudit CommitteeName of SupervisoryDirectorMember of AuditCommitteeMember of CompensationCommitteeMember of Selection and AppointmentCommitteeMember of Science and TechnologyCommitteesubmission by employees of concerns. Additionally, this includes the receipt, retention and treatment of submissions

received regarding accounting, internal accounting controls, or auditing matters. The Audit Committee discusses our

financial accounting and reporting principles and policies and the adequacy of our internal accounting, financial

and operating controls and procedures with the external auditor and management; considers and approves any

recommendations regarding changes to our accounting policies and processes; reviews with management and the

external auditor our quarterly earnings reports prior to their release to the press; and reviews the quarterly and

annual reports (reported on Forms 6-K and 20-F) to be furnished to or filed with the Securities and Exchange
Commission and the Deutsche Boerse as well as the half-year and annual reports filed with The Netherlands
C O R P O R AT E   G O V E R N A N C E   A N D   C O M P E N S AT I O N
Authority for the Financial Markets. The Audit Committee met seven times in 2019 and met with the external auditor
excluding members of the Managing Board in July and October 2019. The Audit Committee reviews major financial
risk exposures, pre-approves related-party transactions between the Company and Supervisory Board or Managing
Board, and reviews any legal matter including compliance topics that could have a significant impact on the
financial statements.

Corporate Governance Report

The Compensation Committee’s primary duties and responsibilities include, among other things, the preparation of a
proposal for the Supervisory Board concerning the Remuneration Policy for the Managing Board to be adopted by
the General Meeting, the preparation of a proposal concerning the individual compensation of Managing Board
members to be adopted by the Supervisory Board and the preparation of the Remuneration Report on compensation
policies for the Managing Board to be adopted by the Supervisory Board. The Compensation Committee reviews
and approves all equity-based compensation, reviews and approves the annual salaries, bonuses and other benefits
of executive officers, and reviews general policies relating to employee compensation and benefits. The
Remuneration Report reviews the implementation of the Remuneration Policy in the most recent year and provides an
outline of the Remuneration Policy for the future. The Compensation Committee engages external consultants to
ensure that the overall remuneration levels are benchmarked regularly, against a selected group of companies and
key markets in which QIAGEN operates. The Compensation Committee currently consists of three members, Ms.
Tallett (Chair), Mr. Bancel and Dr. Björklund. Members are appointed by the Supervisory Board and serve for a term
of one year. The Compensation Committee met five times in December 31, 2019.

The Selection and Appointment (Nomination) Committee is primarily responsible for the preparation of selection
criteria and appointment procedures for members of the Supervisory Board and Managing Board as well as the
periodic evaluation of the scope and composition of the Managing Board and the Supervisory Board, including the
profile of the Supervisory Board. Additionally, the Selection and Appointment Committee periodically evaluates the
functioning of individual members of the Managing Board and Supervisory Board, reporting these results to our
Supervisory Board. It also proposes the (re-)appointments of members of our Managing Board and Supervisory
Board and supervises the policy of our Managing Board in relation to selection and appointment criteria for senior
management. Current members of the Selection and Appointment Committee are Dr. Björklund (Chair), Dr. Colpan
and Ms. Tallett. Members are appointed by the Supervisory Board and serve for a one-year term. In the context of
the 2019 departure of the Chief Executive Officer, the Chair of the Supervisory Board invited all members of the
Supervisory Board to participate in the resulting succession process. Consequently, these matters were discussed
during Supervisory Board meetings and teleconferences and not in the forum of the Selection and Appointment
committee, which did not formally meet in December 31, 2019.

The Science and Technology Committee is primarily responsible for reviewing and monitoring research and
development projects, programs, budgets, infrastructure management and overseeing the management risks related
to the Company's portfolio and information technology platforms. The Science and Technology Committee provides
understanding, clarification and validation of the fundamental technical basis of the Company's businesses in order
to enable the Supervisory Board to make informed, strategic business decisions and vote on related matters, and to
guide the Managing Board to ensure that powerful, global, world-class science is developed, practiced and
leveraged throughout the Company to create shareholder value. The current members of the Science and Technology
Committee are Dr. Colpan (Chair), Dr. Levine, Mr. Bancel and Dr. Mardis. Members are appointed by the
Supervisory Board and serve for a term of one year. The Science and Technology Committee met four times in
December 31, 2019.

119

Compensation CommitteeSelection and Appointment CommitteeScience and Technology CommitteeThe Dutch Civil Code provided for statutory provisions to ensure a balanced representation of men and women on
the Managing Board and Supervisory Boards until January 1, 2016. These statutory rules have expired, but a new
bill entered into force on April 13, 2017, extending the provision on gender balance to December 31, 2019.
Balanced representation of men and women is deemed to exist if at least 30 percent of the seats were filled by men
and at least 30 percent are filled by women. Within the meaning of the new legislation, our Managing Board and
Supervisory Board currently do not qualify as balanced. QIAGEN recognizes the benefits of diversity, including
gender balance. In nominating candidates for these boards, QIAGEN supports the trend toward higher participation
of women. QIAGEN feels that gender is only one part of diversity and strives for a diverse composition in the
Managing Board and Supervisory Board also in terms of other factors such as age, nationality, public reputation,
industry or academic background. QIAGEN is committed to expanding diversity while pursuing individuals for these
boards with a unique blend of scientific and commercial expertise and experience that will contribute to the future
success of its business. Management development programs support the career advancement of leaders regardless of
gender and other factors. As a result a number of women are in key leadership roles, particularly in leading
commercial and operational positions around the world. In line with this commitment, QIAGEN's Selection and
Appointment committee will continue selecting future members of the Managing Board and Supervisory Board with
due observance of its aim to have a diverse leadership team on the basis of gender, but also on the basis of age,
wide ranging experience, backgrounds, skills, knowledge and insight. This all without compromising QIAGEN's
commitment to hiring the best individuals for those positions. More information about diversity within the Board other
than gender, can be found in below under the section Dutch Corporate Governance Code - Comply or explain.

Compensation of Managing Board Members and Supervisory Directors

The objective of our remuneration policy is to attract and retain the talented, highly qualified international leaders
and skilled individuals, who enable QIAGEN to achieve its short and long-term strategic initiatives and operational
excellence. Our remuneration policy aligns remuneration with individual performance, corporate performance and
fosters sustainable growth and long-term value creation in the context of QIAGEN’s social responsibility and
stakeholders’ interest.

The remuneration policy and overall remuneration levels are regularly reviewed by an independent compensation
consulting firm and benchmarked, against a selected group of companies and key markets in which QIAGEN
operates, to ensure overall competitiveness. QIAGEN participates in various compensation benchmarking surveys
that provide information on the level, as well as the structure, of compensation awarded by various companies and
industries for a broad range of positions around the world. The companies in the peer group are selected on the
basis of market capitalization, competitors for talent, similar complexity and international spread, operating in similar
industries.

The performance of the Managing Board members is measured annually against a written set of goals. The
remuneration of the Managing Board members is linked to the achievement of QIAGEN’s strategic and financial
goals. To ensure that remuneration is linked to performance, a significant proportion of the remuneration package is
variable and contingent on performance of the individual and the company. These goals are set at ambitious levels
each year to motivate and drive performance, with a focus on achieving both long-term strategic initiatives and short-
term objectives based on the annual operative planning. Performance metrics used for these goals include the
achievement of financial and non-financial targets.

The remuneration package of the Managing Board members consists of a combination of base salary, short term
variable cash award and several elements of long term incentives (together, ‘total direct compensation’). In addition,
the members of the Managing Board receive a pension arrangement and other benefits that are standard in our
industry, such as a company car.

The total target remuneration package of the Managing Board members is appropriately set against a variety of
120
factors which includes external and internal equity, experience, complexity of the position, scope and

Diversity within the Management Board and Supervisory BoardRemuneration policyThe Dutch Civil Code provided for statutory provisions to ensure a balanced representation of men and women on

the Managing Board and Supervisory Boards until January 1, 2016. These statutory rules have expired, but a new

bill entered into force on April 13, 2017, extending the provision on gender balance to December 31, 2019.

Balanced representation of men and women is deemed to exist if at least 30 percent of the seats were filled by men

and at least 30 percent are filled by women. Within the meaning of the new legislation, our Managing Board and

Supervisory Board currently do not qualify as balanced. QIAGEN recognizes the benefits of diversity, including

gender balance. In nominating candidates for these boards, QIAGEN supports the trend toward higher participation

of women. QIAGEN feels that gender is only one part of diversity and strives for a diverse composition in the

Managing Board and Supervisory Board also in terms of other factors such as age, nationality, public reputation,

industry or academic background. QIAGEN is committed to expanding diversity while pursuing individuals for these

boards with a unique blend of scientific and commercial expertise and experience that will contribute to the future

success of its business. Management development programs support the career advancement of leaders regardless of

gender and other factors. As a result a number of women are in key leadership roles, particularly in leading

commercial and operational positions around the world. In line with this commitment, QIAGEN's Selection and

Appointment committee will continue selecting future members of the Managing Board and Supervisory Board with

due observance of its aim to have a diverse leadership team on the basis of gender, but also on the basis of age,

wide ranging experience, backgrounds, skills, knowledge and insight. This all without compromising QIAGEN's

commitment to hiring the best individuals for those positions. More information about diversity within the Board other

than gender, can be found in below under the section Dutch Corporate Governance Code - Comply or explain.

Compensation of Managing Board Members and Supervisory Directors

The objective of our remuneration policy is to attract and retain the talented, highly qualified international leaders

and skilled individuals, who enable QIAGEN to achieve its short and long-term strategic initiatives and operational

excellence. Our remuneration policy aligns remuneration with individual performance, corporate performance and

fosters sustainable growth and long-term value creation in the context of QIAGEN’s social responsibility and

stakeholders’ interest.

The remuneration policy and overall remuneration levels are regularly reviewed by an independent compensation

consulting firm and benchmarked, against a selected group of companies and key markets in which QIAGEN

operates, to ensure overall competitiveness. QIAGEN participates in various compensation benchmarking surveys

that provide information on the level, as well as the structure, of compensation awarded by various companies and

industries for a broad range of positions around the world. The companies in the peer group are selected on the

basis of market capitalization, competitors for talent, similar complexity and international spread, operating in similar

industries.

The performance of the Managing Board members is measured annually against a written set of goals. The
Corporate Governance Report
C O R P O R AT E   G O V E R N A N C E   A N D   C O M P E N S AT I O N
remuneration of the Managing Board members is linked to the achievement of QIAGEN’s strategic and financial
goals. To ensure that remuneration is linked to performance, a significant proportion of the remuneration package is
variable and contingent on performance of the individual and the company. These goals are set at ambitious levels
each year to motivate and drive performance, with a focus on achieving both long-term strategic initiatives and short-
term objectives based on the annual operative planning. Performance metrics used for these goals include the
achievement of financial and non-financial targets.

The remuneration package of the Managing Board members consists of a combination of base salary, short term
variable cash award and several elements of long term incentives (together, ‘total direct compensation’). In addition,
the members of the Managing Board receive a pension arrangement and other benefits that are standard in our
industry, such as a company car.

The total target remuneration package of the Managing Board members is appropriately set against a variety of
factors which includes external and internal equity, experience, complexity of the position, scope and
responsibilities. We aim to provide the members of the Managing Board a total direct compensation at market
median level.

The structure of the remuneration package for the Managing Board is designed to balance short-term operational
excellence with long-term sustainable value creation while taking into account the interests of its stakeholders. As
such a significant part of the total remuneration of the Managing Board members consist of variable remuneration
which can differ substantially from year to year depending on our corporate results and individual performance and
may include equity-based compensation which may be subject to vesting conditions over a period of up to 10 years.

The remuneration policies for the Managing Board and for other senior management members of QIAGEN are
generally aligned and consistent.

The compensation granted to the members of the Managing Board in December 31, 2019 consisted of a fixed
salary and variable components, with the significant majority of compensation awarded in the form of QIAGEN
stock units that are restricted for a long multi-year period to align management with the interests of shareholders and
other stakeholders. Variable compensation included long-term equity incentives that were awarded based on
individual performance as well as equity awards in lieu of the value of the annual cash bonus.

In 2014, the General Meeting of Shareholders approved a new remuneration policy for the Managing Board which
provides that future annual regular equity-based compensation grants to members of the Managing Board will
primarily consist of performance stock units. Grants of stock options and restricted stock units which are based on
time vesting only shall no longer be granted on a regular basis and shall be reserved for use as special equity
incentive rewards in certain situations.

Stock options, if granted, to the Managing Board members must have an exercise price that is higher than the market
price at the time of grant. Restricted Stock Units granted to the Managing Board members, vest over a 10-year
period. Performance Stock Units are subject to long-term vesting periods and contingent upon the achievement of
several financial goals over a multi-year period.

In 2018, a grant of Performance Stock Units with mandatory minimum holding levels of QIAGEN shares was made
under the Commitment Program linked to achievement of a three-year plan covering 2019 and 2021 including
quantitative goals for net sales, earnings before interest and taxes (EBIT), QIAGEN Value Added (QVA), a steering
metric that measures the ability of QIAGEN to generate returns and exceed its cost of capital and share price
development as compared to peer companies. Under the Commitment Program, the financial targets for vesting are
based on three-year goals as defined within QIAGEN’s five-year business plan covering the period from 2019 until
the end of 2023. The targets for vesting were set and approved by the Supervisory Board.

The table below state the amounts earned on an accrual basis by our Managing Board members and interim CEO
for the year ended December 31, 2019.

Fixed Salary

Other(3)

Short-term variable cash bonus(2)

Defined contribution on benefit plan

Total cash remuneration

$ 910

6,571

$ 560

121

40

$ 650

34

500

24

$ 684

$ 7,481

$ 600

$ 1,184

$ 7,481

$ 849

—

65

249

76

$ 1,208

$ 7,546

$ 925

( ) M

h

M

d h f

ff

l d d ff

b

d h

Diversity within the Management Board and Supervisory BoardRemuneration policyManaging Board compensationFor the year ended December 31, 2019 (in US$ thousands, except for number of award grants)ThierryBernard(1)Peer M.Schatz(1)RolandSackersTotal fixed income 2019Total short-term income 2019responsibilities. We aim to provide the members of the Managing Board a total direct compensation at market

median level.

The structure of the remuneration package for the Managing Board is designed to balance short-term operational

excellence with long-term sustainable value creation while taking into account the interests of its stakeholders. As

such a significant part of the total remuneration of the Managing Board members consist of variable remuneration

which can differ substantially from year to year depending on our corporate results and individual performance and

may include equity-based compensation which may be subject to vesting conditions over a period of up to 10 years.

The remuneration policies for the Managing Board and for other senior management members of QIAGEN are

generally aligned and consistent.

The compensation granted to the members of the Managing Board in December 31, 2019 consisted of a fixed

salary and variable components, with the significant majority of compensation awarded in the form of QIAGEN

stock units that are restricted for a long multi-year period to align management with the interests of shareholders and

other stakeholders. Variable compensation included long-term equity incentives that were awarded based on

individual performance as well as equity awards in lieu of the value of the annual cash bonus.

In 2014, the General Meeting of Shareholders approved a new remuneration policy for the Managing Board which

provides that future annual regular equity-based compensation grants to members of the Managing Board will

primarily consist of performance stock units. Grants of stock options and restricted stock units which are based on

time vesting only shall no longer be granted on a regular basis and shall be reserved for use as special equity

incentive rewards in certain situations.

Stock options, if granted, to the Managing Board members must have an exercise price that is higher than the market

price at the time of grant. Restricted Stock Units granted to the Managing Board members, vest over a 10-year

period. Performance Stock Units are subject to long-term vesting periods and contingent upon the achievement of

several financial goals over a multi-year period.

In 2018, a grant of Performance Stock Units with mandatory minimum holding levels of QIAGEN shares was made

under the Commitment Program linked to achievement of a three-year plan covering 2019 and 2021 including

quantitative goals for net sales, earnings before interest and taxes (EBIT), QIAGEN Value Added (QVA), a steering
metric that measures the ability of QIAGEN to generate returns and exceed its cost of capital and share price
development as compared to peer companies. Under the Commitment Program, the financial targets for vesting are
based on three-year goals as defined within QIAGEN’s five-year business plan covering the period from 2019 until
the end of 2023. The targets for vesting were set and approved by the Supervisory Board.

The table below state the amounts earned on an accrual basis by our Managing Board members and interim CEO
for the year ended December 31, 2019.

Fixed Salary

Other(3)

Short-term variable cash bonus(2)

Defined contribution on benefit plan

Total cash remuneration

$ 650

34

$ 910

6,571

$ 560

40

$ 684

$ 7,481

$ 600

500

—

249

$ 1,184

$ 7,481

$ 849

24

65

76

$ 1,208

$ 7,546

$ 925

h

d h
( ) M
(1) Mr. Schatz’s contract as Managing Director and Chief Executive Officer concluded effective September 30, 2019 and he
continues as a Senior Advisor until June 30, 2021. In October 2019, Mr. Bernard was named Interim Chief Executive Officer in
addition to his prior role as Senior Vice President, Head of Molecular Diagnostics Business Area. Mr. Bernard is not a statutory
director under Dutch law.

l d d ff

d h f

M

b

ff

(2) The Performance Stock Units Granted amount includes the number of performance share units granted to each Managing
Board member in 2019 for the conversion of 2018 cash bonus earned by each Managing Board member in 2018. In 2019, Mr.
Schatz received 60,982 performance stock units and Mr. Sackers received 21,131 performance stock units.

(3) Amounts include, among others, car lease and reimbursed personal expenses such as tax consulting. Additionally, the amount
for Mr. Schatz includes separation payments due upon the conclusion of his agreement. We also occasionally reimburse our
Managing Directors' personal expenses related to attending out-of-town meetings but not directly related to their attendance.
Amounts do not include the reimbursement of certain expenses relating to travel incurred at the request of QIAGEN, other
reimbursements or payments that in total did not exceed $10,000 or tax amounts paid by the Company to tax authorities in
order to avoid double-taxation under multi-tax jurisdiction employment agreements. Compensation for Mr. Schatz for 2019 is
excluding EUR 0.7 million to account for the tax levy payable to the Dutch tax authorities by the Company on termination benefits
pursuant to Article 32bb of the Dutch wage tax act.

The total recognized compensation expense in accordance with IFRS 2 for share-based compensation in the year
December 31, 2019 (2018) for long-term compensation of stock units amounted to $1.7 million for Mr. Bernard,
$37.4 million ($12.3 million) for Mr. Schatz and $4.7 million ($3.6 million) for Mr. Sackers. Based on such
valuations, the total compensation including share-based compensation expenses in the year 2019 (2018) for
members of the Managing Board and interim CEO was $53.5 million ($18.0 million), and amounts to $2.9 million
for Mr. Bernard, $44.9 million ($13.7 million) for Mr. Schatz and $5.6 million ($4.3 million) for Mr. Sackers.

Further details on the composition of remuneration for the Managing Board, and the implementation of the
Remuneration Policy during December 31, 2019, are disclosed in the Remuneration Report of the Compensation
Committee as published on our website at www.QIAGEN.com.

The Supervisory Board remuneration is aligned to the applicable market standards, considering peer companies of
similar size and complexity in similar industries, including biotechnology, life science supplies, diagnostics and
pharmaceuticals, to reflect our nexus to the European Markets as a Dutch company as well as our U.S. focus as a
NYSE listed company subject to U.S. regulations and the fact that several of the Supervisory Board members are
residing in the United States.

The Supervisory Board compensation for 2019 consists of fixed retainer compensation and additional retainer
amounts for Chairman and Vice Chairman. Annual remuneration of the Supervisory Board members is as follows:

Fee payable to the Chairman of the Supervisory Board

Fee payable to each member of the Supervisory Board

Additional compensation payable to members holding the following positions:

Chairman of the Audit Committee

122

Chairman of the Compensation Committee

Chairman of the Selection and Appointment Committee and other board committees

Fee payable to each member of the Audit Committee

Fee payable to each member of the Compensation Committee

Fee payable to each member of the Selection and Appointment Committee and other board committees

$150,000

$57,500

$25,000

$18,000

$12,000

$15,000

$11,000

$6,000

Further, the Supervisory Board members will be reimbursed for tax consulting costs incurred in connection with the

preparation of their tax returns up to an amount of €5,000 per person per fiscal year.

Supervisory board members also receive a variable component, in the form of share-based compensation. We did

not pay any agency or advisory service fees to members of the Supervisory Board.

The following table summarizes the total compensation paid to the members of the Supervisory Board in December

31, 2019:

Supervisory Board compensationManaging Board compensationFor the year ended December 31, 2019 (in US$ thousands, except for number of award grants)ThierryBernard(1)Peer M.Schatz(1)RolandSackersTotal fixed income 2019Total short-term income 2019(1) Mr. Schatz’s contract as Managing Director and Chief Executive Officer concluded effective September 30, 2019 and he

continues as a Senior Advisor until June 30, 2021. In October 2019, Mr. Bernard was named Interim Chief Executive Officer in

addition to his prior role as Senior Vice President, Head of Molecular Diagnostics Business Area. Mr. Bernard is not a statutory

director under Dutch law.

(2) The Performance Stock Units Granted amount includes the number of performance share units granted to each Managing

Board member in 2019 for the conversion of 2018 cash bonus earned by each Managing Board member in 2018. In 2019, Mr.

Schatz received 60,982 performance stock units and Mr. Sackers received 21,131 performance stock units.

(3) Amounts include, among others, car lease and reimbursed personal expenses such as tax consulting. Additionally, the amount

for Mr. Schatz includes separation payments due upon the conclusion of his agreement. We also occasionally reimburse our

Managing Directors' personal expenses related to attending out-of-town meetings but not directly related to their attendance.

Amounts do not include the reimbursement of certain expenses relating to travel incurred at the request of QIAGEN, other

reimbursements or payments that in total did not exceed $10,000 or tax amounts paid by the Company to tax authorities in

order to avoid double-taxation under multi-tax jurisdiction employment agreements. Compensation for Mr. Schatz for 2019 is

excluding EUR 0.7 million to account for the tax levy payable to the Dutch tax authorities by the Company on termination benefits

pursuant to Article 32bb of the Dutch wage tax act.

The total recognized compensation expense in accordance with IFRS 2 for share-based compensation in the year

December 31, 2019 (2018) for long-term compensation of stock units amounted to $1.7 million for Mr. Bernard,

$37.4 million ($12.3 million) for Mr. Schatz and $4.7 million ($3.6 million) for Mr. Sackers. Based on such

valuations, the total compensation including share-based compensation expenses in the year 2019 (2018) for

members of the Managing Board and interim CEO was $53.5 million ($18.0 million), and amounts to $2.9 million

for Mr. Bernard, $44.9 million ($13.7 million) for Mr. Schatz and $5.6 million ($4.3 million) for Mr. Sackers.

Further details on the composition of remuneration for the Managing Board, and the implementation of the

Remuneration Policy during December 31, 2019, are disclosed in the Remuneration Report of the Compensation

Committee as published on our website at www.QIAGEN.com.

C O R P O R AT E   G O V E R N A N C E   A N D   C O M P E N S AT I O N

Corporate Governance Report

The Supervisory Board remuneration is aligned to the applicable market standards, considering peer companies of
similar size and complexity in similar industries, including biotechnology, life science supplies, diagnostics and
pharmaceuticals, to reflect our nexus to the European Markets as a Dutch company as well as our U.S. focus as a
NYSE listed company subject to U.S. regulations and the fact that several of the Supervisory Board members are
residing in the United States.

The Supervisory Board compensation for 2019 consists of fixed retainer compensation and additional retainer
amounts for Chairman and Vice Chairman. Annual remuneration of the Supervisory Board members is as follows:

Fee payable to the Chairman of the Supervisory Board

Fee payable to each member of the Supervisory Board

Additional compensation payable to members holding the following positions:

Chairman of the Audit Committee

Chairman of the Compensation Committee

Chairman of the Selection and Appointment Committee and other board committees

Fee payable to each member of the Audit Committee

Fee payable to each member of the Compensation Committee

Fee payable to each member of the Selection and Appointment Committee and other board committees

$150,000

$57,500

$25,000

$18,000

$12,000

$15,000

$11,000

$6,000

Further, the Supervisory Board members will be reimbursed for tax consulting costs incurred in connection with the
preparation of their tax returns up to an amount of €5,000 per person per fiscal year.

Supervisory board members also receive a variable component, in the form of share-based compensation. We did
not pay any agency or advisory service fees to members of the Supervisory Board.

The following table summarizes the total compensation paid to the members of the Supervisory Board in December
31, 2019:

Stéphane Bancel

Dr. Håkan Björklund

Dr. Metin Colpan

Dr. Ross L. Levine

Dr. Elaine Mardis

Lawrence A. Rosen

Elizabeth E. Tallett

$ 57.5

$ 150.0

$ 57.5

$ 57.5

$ 57.5

$ 57.5

$ 57.5

—

12.0

12.0

—

—

25.0

18.0

32.0

$ 89.5

11.0 $ 173.0

6.0

$ 75.5

6.0

$ 63.5

6.0

$ 63.5

— $ 82.5

21.0

$ 96.5

9,331

9,331

9,331

9,331

9,331

9,331

9,331

(1)  Supervisory Directors are reimbursed for travel costs and for any value-added tax to be paid on their remuneration. These
reimbursements are excluded from the amounts presented herein.

The total recognized compensation expense in accordance with IFRS 2 for share-based compensation in the year
2019 (2018) for long-term compensation of restricted stock units amounted to $1.9 million ($1.5 million) and
includes $321.3 thousand ($259.0 thousand) for Mr. Bancel, $150.8 thousand ($58.3 thousand) for Mr. Björklund,
$327.6 thousand ($270.6 thousand) for Mr. Colpan, $235.8 thousand ($128.0 thousand) for Mr. Levine, $315.7
thousand ($227.6 thousand) for Ms. Mardis, $321.3 thousand ($259.0 thousand) for Mr. Rosen and $229.0
thousand ($201.4 thousand) for Ms. Tallett. $120.2 thousand in 2018 for Mr. Karobath, who did not stand for re-
election at the Company’s Annual General Meeting in June 2018.

The total recognized compensation expense, including share-based compensation expenses, for members of the
Supervisory Board in 2019 (2018) totaled $2.5 million ($2.2 million) and includes amounts of $410.8 thousand
($348.5 thousand) for Mr. Bancel, $323.8 thousand ($182.1 thousand) for Mr. Björklund, $403.1 thousand
($346.1 thousand) for Mr. Colpan, $299.3 thousand ($191.5 thousand) for Mr. Levine, $379.2 thousand ($291.1
thousand) for Ms. Mardis, $403.8 thousand ($341.5 thousand) for Mr. Rosen, $325.5 thousand ($297.9 thousand)
for Ms. Tallett and $209.7 thousand in 2018 for Mr. Karobath.

The following table sets forth certain information as of January 31, 2020 concerning the ownership of Common

Shares by our directors and officers. In preparing the following table, we have relied on information furnished by

such persons.

123

*

*

*

—

—

—

—

*

Thierry Bernard, United States

Roland Sackers, Germany

Stéphane Bancel, United States

Dr. Håkan Björklund, Sweden

Dr. Metin Colpan, Germany

Dr. Ross L. Levine, United States

Dr. Elaine Mardis, United States

Lawrence A. Rosen, United States

Elizabeth Tallett, United States

2020.

3,550,617

1.56 %

47,526

139,476

9,975

—

—

—

—

(3)

(4)

(5)

(6)

(7)

(8)

(9)

22,167

(10)

* Indicates that the person beneficially owns less than 0.5% of the Common Shares issued and outstanding as of January 31,

(1) The number of Common Shares outstanding as of January 31, 2020 was 227,626,974. The persons and entities named in

the table have sole voting and investment power with respect to all shares shown as beneficially owned by them and have the

h

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Supervisory Board compensationShare OwnershipFor the year ended December 31, 2019 (in US$ thousands, exceptfor number of share grants)FixedremunerationChairman /ChairwomanCommitteemembershipTotal(1)Number of restrictedstock units grantedName and Country of ResidenceShares Beneficially Owned(1)Number (2)PercentOwnershipStéphane Bancel

Stéphane Bancel

Stéphane Bancel

Stéphane Bancel

Dr. Håkan Björklund

Dr. Håkan Björklund

Dr. Håkan Björklund

Dr. Håkan Björklund

Dr. Metin Colpan

Dr. Metin Colpan

Dr. Metin Colpan

Dr. Metin Colpan

Dr. Ross L. Levine

Dr. Ross L. Levine

Dr. Ross L. Levine

Dr. Ross L. Levine

Dr. Elaine Mardis

Dr. Elaine Mardis

Dr. Elaine Mardis

Dr. Elaine Mardis

Lawrence A. Rosen

Lawrence A. Rosen

Lawrence A. Rosen

Lawrence A. Rosen

Elizabeth E. Tallett

Elizabeth E. Tallett

Elizabeth E. Tallett

Elizabeth E. Tallett

$ 57.5

$ 57.5

$ 57.5

$ 57.5

—

—

—

—

32.0

32.0

32.0

32.0

$ 89.5

$ 89.5

$ 89.5

$ 89.5

$ 150.0

$ 150.0

$ 150.0

$ 150.0

12.0

12.0

12.0

12.0

11.0 $ 173.0

11.0 $ 173.0

11.0 $ 173.0

11.0 $ 173.0

$ 57.5

$ 57.5

$ 57.5

$ 57.5

12.0

12.0

12.0

12.0

6.0

6.0

6.0

6.0

$ 75.5

$ 75.5

$ 75.5

$ 75.5

$ 57.5

$ 57.5

$ 57.5

$ 57.5

—

—

—

—

6.0

6.0

6.0

6.0

$ 63.5

$ 63.5

$ 63.5

$ 63.5

$ 57.5

$ 57.5

$ 57.5

$ 57.5

—

—

—

—

6.0

6.0

6.0

6.0

$ 63.5

$ 63.5

$ 63.5

$ 63.5

$ 57.5

$ 57.5

$ 57.5

$ 57.5

25.0

25.0

25.0

25.0

— $ 82.5

— $ 82.5

— $ 82.5

— $ 82.5

$ 57.5

$ 57.5

$ 57.5

$ 57.5

18.0

18.0

18.0

18.0

21.0

21.0

21.0

21.0

$ 96.5

$ 96.5

$ 96.5

$ 96.5

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

9,331

(1)  Supervisory Directors are reimbursed for travel costs and for any value-added tax to be paid on their remuneration. These
reimbursements are excluded from the amounts presented herein.

(1)  Supervisory Directors are reimbursed for travel costs and for any value-added tax to be paid on their remuneration. These
(1)  Supervisory Directors are reimbursed for travel costs and for any value-added tax to be paid on their remuneration. These
(1)  Supervisory Directors are reimbursed for travel costs and for any value-added tax to be paid on their remuneration. These
reimbursements are excluded from the amounts presented herein.
reimbursements are excluded from the amounts presented herein.
reimbursements are excluded from the amounts presented herein.

The total recognized compensation expense in accordance with IFRS 2 for share-based compensation in the year
The total recognized compensation expense in accordance with IFRS 2 for share-based compensation in the year
The total recognized compensation expense in accordance with IFRS 2 for share-based compensation in the year
The total recognized compensation expense in accordance with IFRS 2 for share-based compensation in the year
2019 (2018) for long-term compensation of restricted stock units amounted to $1.9 million ($1.5 million) and
2019 (2018) for long-term compensation of restricted stock units amounted to $1.9 million ($1.5 million) and
2019 (2018) for long-term compensation of restricted stock units amounted to $1.9 million ($1.5 million) and
2019 (2018) for long-term compensation of restricted stock units amounted to $1.9 million ($1.5 million) and
includes $321.3 thousand ($259.0 thousand) for Mr. Bancel, $150.8 thousand ($58.3 thousand) for Mr. Björklund,
includes $321.3 thousand ($259.0 thousand) for Mr. Bancel, $150.8 thousand ($58.3 thousand) for Mr. Björklund,
includes $321.3 thousand ($259.0 thousand) for Mr. Bancel, $150.8 thousand ($58.3 thousand) for Mr. Björklund,
includes $321.3 thousand ($259.0 thousand) for Mr. Bancel, $150.8 thousand ($58.3 thousand) for Mr. Björklund,
$327.6 thousand ($270.6 thousand) for Mr. Colpan, $235.8 thousand ($128.0 thousand) for Mr. Levine, $315.7
$327.6 thousand ($270.6 thousand) for Mr. Colpan, $235.8 thousand ($128.0 thousand) for Mr. Levine, $315.7
$327.6 thousand ($270.6 thousand) for Mr. Colpan, $235.8 thousand ($128.0 thousand) for Mr. Levine, $315.7
$327.6 thousand ($270.6 thousand) for Mr. Colpan, $235.8 thousand ($128.0 thousand) for Mr. Levine, $315.7
thousand ($227.6 thousand) for Ms. Mardis, $321.3 thousand ($259.0 thousand) for Mr. Rosen and $229.0
thousand ($227.6 thousand) for Ms. Mardis, $321.3 thousand ($259.0 thousand) for Mr. Rosen and $229.0
thousand ($227.6 thousand) for Ms. Mardis, $321.3 thousand ($259.0 thousand) for Mr. Rosen and $229.0
thousand ($227.6 thousand) for Ms. Mardis, $321.3 thousand ($259.0 thousand) for Mr. Rosen and $229.0
thousand ($201.4 thousand) for Ms. Tallett. $120.2 thousand in 2018 for Mr. Karobath, who did not stand for re-
thousand ($201.4 thousand) for Ms. Tallett. $120.2 thousand in 2018 for Mr. Karobath, who did not stand for re-
thousand ($201.4 thousand) for Ms. Tallett. $120.2 thousand in 2018 for Mr. Karobath, who did not stand for re-
thousand ($201.4 thousand) for Ms. Tallett. $120.2 thousand in 2018 for Mr. Karobath, who did not stand for re-
election at the Company’s Annual General Meeting in June 2018.
election at the Company’s Annual General Meeting in June 2018.
election at the Company’s Annual General Meeting in June 2018.
election at the Company’s Annual General Meeting in June 2018.

The total recognized compensation expense, including share-based compensation expenses, for members of the
The total recognized compensation expense, including share-based compensation expenses, for members of the
The total recognized compensation expense, including share-based compensation expenses, for members of the
The total recognized compensation expense, including share-based compensation expenses, for members of the
Supervisory Board in 2019 (2018) totaled $2.5 million ($2.2 million) and includes amounts of $410.8 thousand
Supervisory Board in 2019 (2018) totaled $2.5 million ($2.2 million) and includes amounts of $410.8 thousand
Supervisory Board in 2019 (2018) totaled $2.5 million ($2.2 million) and includes amounts of $410.8 thousand
Supervisory Board in 2019 (2018) totaled $2.5 million ($2.2 million) and includes amounts of $410.8 thousand
($348.5 thousand) for Mr. Bancel, $323.8 thousand ($182.1 thousand) for Mr. Björklund, $403.1 thousand
($348.5 thousand) for Mr. Bancel, $323.8 thousand ($182.1 thousand) for Mr. Björklund, $403.1 thousand
($348.5 thousand) for Mr. Bancel, $323.8 thousand ($182.1 thousand) for Mr. Björklund, $403.1 thousand
($348.5 thousand) for Mr. Bancel, $323.8 thousand ($182.1 thousand) for Mr. Björklund, $403.1 thousand
($346.1 thousand) for Mr. Colpan, $299.3 thousand ($191.5 thousand) for Mr. Levine, $379.2 thousand ($291.1
($346.1 thousand) for Mr. Colpan, $299.3 thousand ($191.5 thousand) for Mr. Levine, $379.2 thousand ($291.1
($346.1 thousand) for Mr. Colpan, $299.3 thousand ($191.5 thousand) for Mr. Levine, $379.2 thousand ($291.1
($346.1 thousand) for Mr. Colpan, $299.3 thousand ($191.5 thousand) for Mr. Levine, $379.2 thousand ($291.1
thousand) for Ms. Mardis, $403.8 thousand ($341.5 thousand) for Mr. Rosen, $325.5 thousand ($297.9 thousand)
thousand) for Ms. Mardis, $403.8 thousand ($341.5 thousand) for Mr. Rosen, $325.5 thousand ($297.9 thousand)
thousand) for Ms. Mardis, $403.8 thousand ($341.5 thousand) for Mr. Rosen, $325.5 thousand ($297.9 thousand)
thousand) for Ms. Mardis, $403.8 thousand ($341.5 thousand) for Mr. Rosen, $325.5 thousand ($297.9 thousand)
for Ms. Tallett and $209.7 thousand in 2018 for Mr. Karobath.
for Ms. Tallett and $209.7 thousand in 2018 for Mr. Karobath.
for Ms. Tallett and $209.7 thousand in 2018 for Mr. Karobath.
for Ms. Tallett and $209.7 thousand in 2018 for Mr. Karobath.

The following table sets forth certain information as of January 31, 2020 concerning the ownership of Common
Shares by our directors and officers. In preparing the following table, we have relied on information furnished by
such persons.

The following table sets forth certain information as of January 31, 2020 concerning the ownership of Common
The following table sets forth certain information as of January 31, 2020 concerning the ownership of Common
The following table sets forth certain information as of January 31, 2020 concerning the ownership of Common
Shares by our directors and officers. In preparing the following table, we have relied on information furnished by
Shares by our directors and officers. In preparing the following table, we have relied on information furnished by
Shares by our directors and officers. In preparing the following table, we have relied on information furnished by
such persons.
such persons.
such persons.

Thierry Bernard, United States

Thierry Bernard, United States
Thierry Bernard, United States

Thierry Bernard, United States

Roland Sackers, Germany

Roland Sackers, Germany
Roland Sackers, Germany

Roland Sackers, Germany

Stéphane Bancel, United States

Stéphane Bancel, United States
Stéphane Bancel, United States

Stéphane Bancel, United States

Dr. Håkan Björklund, Sweden

Dr. Håkan Björklund, Sweden
Dr. Håkan Björklund, Sweden

Dr. Håkan Björklund, Sweden

Dr. Metin Colpan, Germany

Dr. Metin Colpan, Germany
Dr. Metin Colpan, Germany

Dr. Metin Colpan, Germany

47,526

47,526
47,526

47,526

139,476

139,476
139,476

139,476

9,975

9,975
9,975

9,975

—

—
—

—

3,550,617

3,550,617
3,550,617

3,550,617

(3)

(3)
(3)

(3)

(4)

(4)
(4)

(4)

(5)

(5)
(5)

(5)

(6)

(6)
(6)

(6)

Dr. Ross L. Levine, United States

Dr. Ross L. Levine, United States
Dr. Ross L. Levine, United States

Dr. Ross L. Levine, United States

Dr. Elaine Mardis, United States

Dr. Elaine Mardis, United States
Dr. Elaine Mardis, United States

Dr. Elaine Mardis, United States

Lawrence A. Rosen, United States

Lawrence A. Rosen, United States
Lawrence A. Rosen, United States

Lawrence A. Rosen, United States

—

—
—

—

(7)

(7)
(7)

(7)

—

—
—

—

(8)

(8)
(8)

(8)

—

—
—

—

(9)

(9)
(9)

(9)

Elizabeth Tallett, United States

Elizabeth Tallett, United States
Elizabeth Tallett, United States

Elizabeth Tallett, United States

22,167

22,167
22,167

22,167

(10)

(10)
(10)

(10)

*

*

*

*
*

*

*
*

*

*
*

*

—

—
—

—

1.56 %

1.56 %
1.56 %

1.56 %

—

—
—

—

—

—
—

—

—

—
—

—

*

*
*

*

* Indicates that the person beneficially owns less than 0.5% of the Common Shares issued and outstanding as of January 31,
2020.

* Indicates that the person beneficially owns less than 0.5% of the Common Shares issued and outstanding as of January 31,
* Indicates that the person beneficially owns less than 0.5% of the Common Shares issued and outstanding as of January 31,
* Indicates that the person beneficially owns less than 0.5% of the Common Shares issued and outstanding as of January 31,
2020.
2020.
2020.

(1) The number of Common Shares outstanding as of January 31, 2020 was 227,626,974. The persons and entities named in
the table have sole voting and investment power with respect to all shares shown as beneficially owned by them and have the

(1) The number of Common Shares outstanding as of January 31, 2020 was 227,626,974. The persons and entities named in
(1) The number of Common Shares outstanding as of January 31, 2020 was 227,626,974. The persons and entities named in
(1) The number of Common Shares outstanding as of January 31, 2020 was 227,626,974. The persons and entities named in
the table have sole voting and investment power with respect to all shares shown as beneficially owned by them and have the
the table have sole voting and investment power with respect to all shares shown as beneficially owned by them and have the
the table have sole voting and investment power with respect to all shares shown as beneficially owned by them and have the

same voting rights as shareholders with respect to Common Shares.
h
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(2) Does not include Common Shares subject to options or awards held by such persons at January 31, 2020. See footnotes
below for information regarding options now exercisable or that could become exercisable within 60 days of the date of this
table.

(3) Does not include 20,010 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(4) Does not include 135,739 shares issuable upon the exercise of options now exercisable having exercise prices ranging from
$15.59 to $22.25 per share. Options expire in increments during the period between February 2020 and February 2023. Does
not include 88,917 shares issuable upon the release of unvested stock awards that could become releasable within 60 days from
the date of this table.

(5) Does not include 11,037 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(6) Does not include 4,567 shares issuable upon the exercise of options now exercisable having exercise prices ranging from
$15.59 to $22.25 per share. Options expire in increments during the period between February 2020 and February 2022.
Includes 2,741,579 shares held by CC Verwaltungs GmbH, of which Dr. Colpan is the sole stockholder and 770,370 shares held
by Colpan GbR. Does not include 11,479 shares issuable upon the release of unvested stock awards that could become
releasable within 60 days from the date of this table.

(7) Does not include 4,292 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(8) Does not include 11,037 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.
124

(9) Does not include 11,037 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(10) Does not include 1,563 shares issuable upon the exercise of options now exercisable having exercise prices of $15.59 per

share. Options expire on February 2022. Does not include 11,037 shares issuable upon the release of unvested stock awards

that could become releasable within 60 days from the date of this table.

The following table sets forth the options of our officers and directors as of January 31, 2020:

Roland Sackers

Dr. Metin Colpan

Elizabeth E. Tallett

135,739

4,567

1,563

2/26/2021 to 2/28/2023

$15.59 to $22.25

2/26/2021 to 2/28/2022

$15.59 to $22.25

2/28/2022

$15.59

Additional Information

Our shareholders exercise their voting rights through Annual and Extraordinary General Meetings. Resolutions of the

General Meeting are adopted by an absolute majority of votes cast, unless a different majority of votes or quorum is

required by Dutch law or the Articles of Association. Each common share confers the right to cast one vote.

Furthermore, the Managing Board, or where appropriate, the Supervisory Board, shall provide all shareholders and

other parties in the financial markets with equal and simultaneous information about matters that may influence

QIAGEN's share price.

QIAGEN is required to convene an Annual General Meeting in the Netherlands no later than six months following

the end of each year. The agenda for the Annual General Meeting must contain certain matters as specified in

QIAGEN's Articles of Association and under Dutch law, including, among other things, the adoption of QIAGEN's

annual financial statements.

Additional Extraordinary General Meetings may be convened at any time by the Managing Board, the Supervisory

Board or by one or more shareholders jointly representing at least 40% of QIAGEN's issued share capital.

Furthermore, one or more shareholders, who jointly represent at least 10% of QIAGEN's issued share capital may,

on their application, be authorized by the district court judge having applications for interim relief, to convene a

General Meeting. Shareholders are entitled to propose items for the agenda of the General Meeting provided that

Share OwnershipFor the year ended December 31, 2019 (in US$ thousands, exceptfor number of share grants)FixedremunerationChairman /ChairwomanCommitteemembershipTotal(1)Number of restrictedstock units grantedName and Country of ResidenceShares Beneficially Owned(1)Number (2)PercentOwnershipShareholdersNameNumber of OptionsExpiration DatesExercise PricesShare OwnershipFor the year ended December 31, 2019 (in US$ thousands, exceptfor number of share grants)FixedremunerationChairman /ChairwomanCommitteemembershipTotal(1)Number of restrictedstock units grantedName and Country of ResidenceShares Beneficially Owned(1)Number (2)PercentOwnershipShare OwnershipFor the year ended December 31, 2019 (in US$ thousands, exceptfor number of share grants)FixedremunerationChairman /ChairwomanCommitteemembershipTotal(1)Number of restrictedstock units grantedName and Country of ResidenceShares Beneficially Owned(1)Number (2)PercentOwnershipShare OwnershipFor the year ended December 31, 2019 (in US$ thousands, exceptfor number of share grants)FixedremunerationChairman /ChairwomanCommitteemembershipTotal(1)Number of restrictedstock units grantedName and Country of ResidenceShares Beneficially Owned(1)Number (2)PercentOwnershipsame voting rights as shareholders with respect to Common Shares.

same voting rights as shareholders with respect to Common Shares.

same voting rights as shareholders with respect to Common Shares.

same voting rights as shareholders with respect to Common Shares.

(2) Does not include Common Shares subject to options or awards held by such persons at January 31, 2020. See footnotes

(2) Does not include Common Shares subject to options or awards held by such persons at January 31, 2020. See footnotes

(2) Does not include Common Shares subject to options or awards held by such persons at January 31, 2020. See footnotes

(2) Does not include Common Shares subject to options or awards held by such persons at January 31, 2020. See footnotes

below for information regarding options now exercisable or that could become exercisable within 60 days of the date of this

below for information regarding options now exercisable or that could become exercisable within 60 days of the date of this

below for information regarding options now exercisable or that could become exercisable within 60 days of the date of this

below for information regarding options now exercisable or that could become exercisable within 60 days of the date of this

table.

table.

table.

table.

days from the date of this table.

days from the date of this table.

days from the date of this table.

days from the date of this table.

(3) Does not include 20,010 shares issuable upon the release of unvested stock awards that could become releasable within 60

(3) Does not include 20,010 shares issuable upon the release of unvested stock awards that could become releasable within 60

(3) Does not include 20,010 shares issuable upon the release of unvested stock awards that could become releasable within 60

(3) Does not include 20,010 shares issuable upon the release of unvested stock awards that could become releasable within 60

(4) Does not include 135,739 shares issuable upon the exercise of options now exercisable having exercise prices ranging from
$15.59 to $22.25 per share. Options expire in increments during the period between February 2020 and February 2023. Does
not include 88,917 shares issuable upon the release of unvested stock awards that could become releasable within 60 days from
C O R P O R AT E   G O V E R N A N C E   A N D   C O M P E N S AT I O N
the date of this table.

(4) Does not include 135,739 shares issuable upon the exercise of options now exercisable having exercise prices ranging from
(4) Does not include 135,739 shares issuable upon the exercise of options now exercisable having exercise prices ranging from
$15.59 to $22.25 per share. Options expire in increments during the period between February 2020 and February 2023. Does
$15.59 to $22.25 per share. Options expire in increments during the period between February 2020 and February 2023. Does
not include 88,917 shares issuable upon the release of unvested stock awards that could become releasable within 60 days from
not include 88,917 shares issuable upon the release of unvested stock awards that could become releasable within 60 days from
the date of this table.
the date of this table.

(4) Does not include 135,739 shares issuable upon the exercise of options now exercisable having exercise prices ranging from
$15.59 to $22.25 per share. Options expire in increments during the period between February 2020 and February 2023. Does
not include 88,917 shares issuable upon the release of unvested stock awards that could become releasable within 60 days from
the date of this table.

Corporate Governance Report

(5) Does not include 11,037 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(5) Does not include 11,037 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(5) Does not include 11,037 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(5) Does not include 11,037 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(6) Does not include 4,567 shares issuable upon the exercise of options now exercisable having exercise prices ranging from
(6) Does not include 4,567 shares issuable upon the exercise of options now exercisable having exercise prices ranging from
(6) Does not include 4,567 shares issuable upon the exercise of options now exercisable having exercise prices ranging from
(6) Does not include 4,567 shares issuable upon the exercise of options now exercisable having exercise prices ranging from
$15.59 to $22.25 per share. Options expire in increments during the period between February 2020 and February 2022.
$15.59 to $22.25 per share. Options expire in increments during the period between February 2020 and February 2022.
$15.59 to $22.25 per share. Options expire in increments during the period between February 2020 and February 2022.
$15.59 to $22.25 per share. Options expire in increments during the period between February 2020 and February 2022.
Includes 2,741,579 shares held by CC Verwaltungs GmbH, of which Dr. Colpan is the sole stockholder and 770,370 shares held
Includes 2,741,579 shares held by CC Verwaltungs GmbH, of which Dr. Colpan is the sole stockholder and 770,370 shares held
Includes 2,741,579 shares held by CC Verwaltungs GmbH, of which Dr. Colpan is the sole stockholder and 770,370 shares held
Includes 2,741,579 shares held by CC Verwaltungs GmbH, of which Dr. Colpan is the sole stockholder and 770,370 shares held
by Colpan GbR. Does not include 11,479 shares issuable upon the release of unvested stock awards that could become
by Colpan GbR. Does not include 11,479 shares issuable upon the release of unvested stock awards that could become
by Colpan GbR. Does not include 11,479 shares issuable upon the release of unvested stock awards that could become
by Colpan GbR. Does not include 11,479 shares issuable upon the release of unvested stock awards that could become
releasable within 60 days from the date of this table.
releasable within 60 days from the date of this table.
releasable within 60 days from the date of this table.
releasable within 60 days from the date of this table.

(7) Does not include 4,292 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(7) Does not include 4,292 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(7) Does not include 4,292 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(7) Does not include 4,292 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(8) Does not include 11,037 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(8) Does not include 11,037 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(8) Does not include 11,037 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(8) Does not include 11,037 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(9) Does not include 11,037 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(9) Does not include 11,037 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(9) Does not include 11,037 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(9) Does not include 11,037 shares issuable upon the release of unvested stock awards that could become releasable within 60
days from the date of this table.

(10) Does not include 1,563 shares issuable upon the exercise of options now exercisable having exercise prices of $15.59 per
share. Options expire on February 2022. Does not include 11,037 shares issuable upon the release of unvested stock awards
that could become releasable within 60 days from the date of this table.

(10) Does not include 1,563 shares issuable upon the exercise of options now exercisable having exercise prices of $15.59 per
(10) Does not include 1,563 shares issuable upon the exercise of options now exercisable having exercise prices of $15.59 per
share. Options expire on February 2022. Does not include 11,037 shares issuable upon the release of unvested stock awards
share. Options expire on February 2022. Does not include 11,037 shares issuable upon the release of unvested stock awards
that could become releasable within 60 days from the date of this table.
that could become releasable within 60 days from the date of this table.

(10) Does not include 1,563 shares issuable upon the exercise of options now exercisable having exercise prices of $15.59 per
share. Options expire on February 2022. Does not include 11,037 shares issuable upon the release of unvested stock awards
that could become releasable within 60 days from the date of this table.

The following table sets forth the options of our officers and directors as of January 31, 2020:

The following table sets forth the options of our officers and directors as of January 31, 2020:

The following table sets forth the options of our officers and directors as of January 31, 2020:

The following table sets forth the options of our officers and directors as of January 31, 2020:

Roland Sackers

Roland Sackers

Roland Sackers

Roland Sackers

135,739

135,739

135,739

135,739

Dr. Metin Colpan

Dr. Metin Colpan

Dr. Metin Colpan

Dr. Metin Colpan

Elizabeth E. Tallett

Elizabeth E. Tallett

Elizabeth E. Tallett

Elizabeth E. Tallett

4,567

4,567

4,567

4,567

1,563

1,563

1,563

1,563

2/26/2021 to 2/28/2023

2/26/2021 to 2/28/2023

2/26/2021 to 2/28/2023

2/26/2021 to 2/28/2023

2/26/2021 to 2/28/2022

2/26/2021 to 2/28/2022

2/26/2021 to 2/28/2022

2/26/2021 to 2/28/2022

$15.59 to $22.25

$15.59 to $22.25

$15.59 to $22.25

$15.59 to $22.25

$15.59 to $22.25

$15.59 to $22.25

$15.59 to $22.25

$15.59 to $22.25

2/28/2022

2/28/2022

2/28/2022

2/28/2022

$15.59

$15.59

$15.59

$15.59

Additional Information

Additional Information
Additional Information

Additional Information

Our shareholders exercise their voting rights through Annual and Extraordinary General Meetings. Resolutions of the
General Meeting are adopted by an absolute majority of votes cast, unless a different majority of votes or quorum is
required by Dutch law or the Articles of Association. Each common share confers the right to cast one vote.

Our shareholders exercise their voting rights through Annual and Extraordinary General Meetings. Resolutions of the
Our shareholders exercise their voting rights through Annual and Extraordinary General Meetings. Resolutions of the
Our shareholders exercise their voting rights through Annual and Extraordinary General Meetings. Resolutions of the
General Meeting are adopted by an absolute majority of votes cast, unless a different majority of votes or quorum is
General Meeting are adopted by an absolute majority of votes cast, unless a different majority of votes or quorum is
General Meeting are adopted by an absolute majority of votes cast, unless a different majority of votes or quorum is
required by Dutch law or the Articles of Association. Each common share confers the right to cast one vote.
required by Dutch law or the Articles of Association. Each common share confers the right to cast one vote.
required by Dutch law or the Articles of Association. Each common share confers the right to cast one vote.

Furthermore, the Managing Board, or where appropriate, the Supervisory Board, shall provide all shareholders and
Furthermore, the Managing Board, or where appropriate, the Supervisory Board, shall provide all shareholders and
other parties in the financial markets with equal and simultaneous information about matters that may influence
other parties in the financial markets with equal and simultaneous information about matters that may influence
QIAGEN's share price.
QIAGEN's share price.

Furthermore, the Managing Board, or where appropriate, the Supervisory Board, shall provide all shareholders and
Furthermore, the Managing Board, or where appropriate, the Supervisory Board, shall provide all shareholders and
other parties in the financial markets with equal and simultaneous information about matters that may influence
other parties in the financial markets with equal and simultaneous information about matters that may influence
QIAGEN's share price.
QIAGEN's share price.

QIAGEN is required to convene an Annual General Meeting in the Netherlands no later than six months following
the end of each year. The agenda for the Annual General Meeting must contain certain matters as specified in
QIAGEN's Articles of Association and under Dutch law, including, among other things, the adoption of QIAGEN's
annual financial statements.

QIAGEN is required to convene an Annual General Meeting in the Netherlands no later than six months following
QIAGEN is required to convene an Annual General Meeting in the Netherlands no later than six months following
QIAGEN is required to convene an Annual General Meeting in the Netherlands no later than six months following
the end of each year. The agenda for the Annual General Meeting must contain certain matters as specified in
the end of each year. The agenda for the Annual General Meeting must contain certain matters as specified in
the end of each year. The agenda for the Annual General Meeting must contain certain matters as specified in
QIAGEN's Articles of Association and under Dutch law, including, among other things, the adoption of QIAGEN's
QIAGEN's Articles of Association and under Dutch law, including, among other things, the adoption of QIAGEN's
QIAGEN's Articles of Association and under Dutch law, including, among other things, the adoption of QIAGEN's
annual financial statements.
annual financial statements.
annual financial statements.

Additional Extraordinary General Meetings may be convened at any time by the Managing Board, the Supervisory
Additional Extraordinary General Meetings may be convened at any time by the Managing Board, the Supervisory
Additional Extraordinary General Meetings may be convened at any time by the Managing Board, the Supervisory
Additional Extraordinary General Meetings may be convened at any time by the Managing Board, the Supervisory
Board or by one or more shareholders jointly representing at least 40% of QIAGEN's issued share capital.
Board or by one or more shareholders jointly representing at least 40% of QIAGEN's issued share capital.
Board or by one or more shareholders jointly representing at least 40% of QIAGEN's issued share capital.
Board or by one or more shareholders jointly representing at least 40% of QIAGEN's issued share capital.
Furthermore, one or more shareholders, who jointly represent at least 10% of QIAGEN's issued share capital may,
Furthermore, one or more shareholders, who jointly represent at least 10% of QIAGEN's issued share capital may,
Furthermore, one or more shareholders, who jointly represent at least 10% of QIAGEN's issued share capital may,
Furthermore, one or more shareholders, who jointly represent at least 10% of QIAGEN's issued share capital may,
on their application, be authorized by the district court judge having applications for interim relief, to convene a
on their application, be authorized by the district court judge having applications for interim relief, to convene a
on their application, be authorized by the district court judge having applications for interim relief, to convene a
on their application, be authorized by the district court judge having applications for interim relief, to convene a
General Meeting. Shareholders are entitled to propose items for the agenda of the General Meeting provided that
General Meeting. Shareholders are entitled to propose items for the agenda of the General Meeting provided that
General Meeting. Shareholders are entitled to propose items for the agenda of the General Meeting provided that
General Meeting. Shareholders are entitled to propose items for the agenda of the General Meeting provided that
they hold at least 3% of the issued share capital. Proposals for agenda items for the General Meeting must be
submitted at least 60 days prior to the meeting date. The notice convening a General Meeting, accompanied by the
agenda, shall be sent no later than 42 days prior to the meeting. QIAGEN informs the General Meeting by means of
explanatory notes to the agenda, providing all facts and circumstances relevant to the proposed resolutions.

Pursuant to the Dutch Code, all transactions between the company and legal or natural persons who hold at least ten
percent of the shares in the company shall be agreed on terms that are customary in the sector concerned. Decisions
to enter into transactions in which there are conflicts of interest with such persons that are of material significance to
the company and/or to such persons require the approval of the Supervisory Board. QIAGEN has not entered into
any such transactions in 2019.

We adopted the QIAGEN N.V. Amended and Restated 2005 Stock Plan (the 2005 Plan) which was approved by
our shareholders on June 14, 2005. The 2005 Plan expired by its terms in April 2015 and no further awards will be

125

granted under the 2005 Plan. On June 25, 2014, our shareholders approved the QIAGEN N.V. 2014 Stock Plan

(the 2014 Plan), which replaced the 2005 Plan in April 2015. An aggregate of 16.7 million Common Shares were

reserved for issuance pursuant to the 2014 Plan, subject to certain antidilution adjustments. We issue Treasury

Shares to satisfy option exercises and award releases and had approximately 15.7 million Common Shares reserved

and available for issuance under the 2005 and 2014 Plans at December 31, 2019.

Pursuant to the 2014 Plan, stock rights, which include options to purchase our Common Shares, stock grants and

stock-based awards, may be granted to employees and consultants of QIAGEN and its subsidiaries and to

Supervisory Directors. Options granted pursuant to the 2014 Plan may either be incentive stock options within the

meaning of Section 422 of the United States Internal Revenue Code of 1986, as amended (the Code), or non-

qualified stock options. Options granted to members of the Supervisory Board and the Managing Board must have

an exercise price that is higher than the market price at the time of grant. Generally, the stock rights and incentive

stock options, as well as non-qualified options, stock grants and stock-based awards have terms of up to five or ten

years, subject to earlier termination in the event of death, disability or other termination of employment. The vesting

and exercisability of certain stock rights will be accelerated in the event of a Change of Control, as defined in the

agreements under the 2014 Plan.

The Plan is administered by the Compensation Committee of the Supervisory Board, which selects participants from

among eligible employees, consultants and directors and determines the number of shares subject to the stock-based

award, the length of time the award will remain outstanding, the manner and time of the award's vesting, the price

per share subject to the award and other terms and conditions of the award consistent with the Plan. The

Compensation Committee's decisions are subject to the approval of the Supervisory Board.

The Compensation Committee has the power, subject to Supervisory Board approval, to interpret the plans and to

adopt such rules and regulations (including the adoption of “sub plans” applicable to participants in specified

jurisdictions) as it may deem necessary or appropriate. The Compensation Committee or the Supervisory Board may

at any time amend the plans in any respect, subject to Supervisory Board approval, and except that (i) no

amendment that would adversely affect the rights of any participant under any option previously granted may be

made without such participant's consent and (ii) no amendment shall be effective prior to shareholder approval to the

extent such approval is required to ensure favorable tax treatment for incentive stock options or to ensure compliance

with Rule 16b-3 under the United States Securities Exchange Act of 1934, as amended (the Exchange Act) at such

times as any participants are subject to Section 16 of the Exchange Act.

As of January 31, 2020, there were 0.7 million options outstanding with exercise prices ranging between $14.91

and $22.25 and expiring between May 31, 2020 and May 31, 2023. The exercise price of the options is the fair

market value of the Common Shares as of the date of grant or a premium above fair market value. Additionally,

there were 5.2 million stock unit awards outstanding as of January 31, 2020. These awards will be released

between February 26, 2020 and May 31, 2028. As of January 31, 2020, options to purchase 0.1 million Common

Shares and 1.0 million stock unit awards were held by the officers and directors of QIAGEN, as a group.

ShareholdersNameNumber of OptionsExpiration DatesExercise PricesStock PlansShareholdersNameNumber of OptionsExpiration DatesExercise PricesShareholdersNameNumber of OptionsExpiration DatesExercise PricesShareholdersNameNumber of OptionsExpiration DatesExercise Pricesthey hold at least 3% of the issued share capital. Proposals for agenda items for the General Meeting must be
submitted at least 60 days prior to the meeting date. The notice convening a General Meeting, accompanied by the
agenda, shall be sent no later than 42 days prior to the meeting. QIAGEN informs the General Meeting by means of
explanatory notes to the agenda, providing all facts and circumstances relevant to the proposed resolutions.

Pursuant to the Dutch Code, all transactions between the company and legal or natural persons who hold at least ten
percent of the shares in the company shall be agreed on terms that are customary in the sector concerned. Decisions
to enter into transactions in which there are conflicts of interest with such persons that are of material significance to
the company and/or to such persons require the approval of the Supervisory Board. QIAGEN has not entered into
any such transactions in 2019.

We adopted the QIAGEN N.V. Amended and Restated 2005 Stock Plan (the 2005 Plan) which was approved by
our shareholders on June 14, 2005. The 2005 Plan expired by its terms in April 2015 and no further awards will be
granted under the 2005 Plan. On June 25, 2014, our shareholders approved the QIAGEN N.V. 2014 Stock Plan
(the 2014 Plan), which replaced the 2005 Plan in April 2015. An aggregate of 16.7 million Common Shares were
reserved for issuance pursuant to the 2014 Plan, subject to certain antidilution adjustments. We issue Treasury
Shares to satisfy option exercises and award releases and had approximately 15.7 million Common Shares reserved
and available for issuance under the 2005 and 2014 Plans at December 31, 2019.

Pursuant to the 2014 Plan, stock rights, which include options to purchase our Common Shares, stock grants and
stock-based awards, may be granted to employees and consultants of QIAGEN and its subsidiaries and to
Supervisory Directors. Options granted pursuant to the 2014 Plan may either be incentive stock options within the
meaning of Section 422 of the United States Internal Revenue Code of 1986, as amended (the Code), or non-
qualified stock options. Options granted to members of the Supervisory Board and the Managing Board must have
an exercise price that is higher than the market price at the time of grant. Generally, the stock rights and incentive
stock options, as well as non-qualified options, stock grants and stock-based awards have terms of up to five or ten
years, subject to earlier termination in the event of death, disability or other termination of employment. The vesting
and exercisability of certain stock rights will be accelerated in the event of a Change of Control, as defined in the
agreements under the 2014 Plan.

The Plan is administered by the Compensation Committee of the Supervisory Board, which selects participants from
among eligible employees, consultants and directors and determines the number of shares subject to the stock-based
award, the length of time the award will remain outstanding, the manner and time of the award's vesting, the price
per share subject to the award and other terms and conditions of the award consistent with the Plan. The
Compensation Committee's decisions are subject to the approval of the Supervisory Board.

The Compensation Committee has the power, subject to Supervisory Board approval, to interpret the plans and to
adopt such rules and regulations (including the adoption of “sub plans” applicable to participants in specified
jurisdictions) as it may deem necessary or appropriate. The Compensation Committee or the Supervisory Board may
at any time amend the plans in any respect, subject to Supervisory Board approval, and except that (i) no
amendment that would adversely affect the rights of any participant under any option previously granted may be
made without such participant's consent and (ii) no amendment shall be effective prior to shareholder approval to the
extent such approval is required to ensure favorable tax treatment for incentive stock options or to ensure compliance
with Rule 16b-3 under the United States Securities Exchange Act of 1934, as amended (the Exchange Act) at such
times as any participants are subject to Section 16 of the Exchange Act.

As of January 31, 2020, there were 0.7 million options outstanding with exercise prices ranging between $14.91
and $22.25 and expiring between May 31, 2020 and May 31, 2023. The exercise price of the options is the fair
market value of the Common Shares as of the date of grant or a premium above fair market value. Additionally,
there were 5.2 million stock unit awards outstanding as of January 31, 2020. These awards will be released
between February 26, 2020 and May 31, 2028. As of January 31, 2020, options to purchase 0.1 million Common
Shares and 1.0 million stock unit awards were held by the officers and directors of QIAGEN, as a group.

126

Stock PlansC O R P O R AT E   G O V E R N A N C E   A N D   C O M P E N S AT I O N

Corporate Governance Report

Further detailed information regarding stock options and awards granted under the plan can be found in Note 22
included in the Consolidated Financial Statements.

Unlike the New York Stock Exchange listing standards which require a majority of the Supervisory Board members to
be independent, the Dutch Corporate Governance Code distinguishes between certain independence criteria which
may be fulfilled by not more than one Supervisory Board Members (as e.g. prior employment with the Company,
receiving personal financial an important business relationship with the Company) and other criteria which may not
be fulfilled by more than the majority of the Supervisory Board members. In some cases the Dutch independence
requirement is more stringent, such as by requiring a longer “look back” period (five years) for former executive
directors. In other cases, the New York Stock Exchange rules are more stringent, such as a broader definition of
disqualifying affiliations. Currently, all members of our Supervisory Board are “independent” under both the New
York Stock Exchange and Dutch definitions.

Reference is made to the discussion in the “Risk Management” and “Risks” section above.

Our Managing Director, with the assistance of other members of management, performed an evaluation of the
effectiveness of the design and operation of our disclosure controls and procedures. Based on that evaluation, they
concluded that as of December 31, 2019, our disclosure controls and procedures were effective to ensure that
information required to be disclosed by us in the reports that we file is recorded, processed, summarized and
reported in a timely manner and is accumulated and communicated to our management, including our Managing
Directors, as appropriate to allow timely decisions regarding required disclosure.

There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, no matter how
well designed, such as the possibility of human error and the circumvention or overriding of the controls and
procedures. Therefore, even those systems determined to be effective may not prevent or detect misstatements and
can provide only reasonable assurance of achieving their control objectives. In addition, any determination of
effectiveness of controls is not a projection of any effectiveness of those controls to future periods, as those controls
may become inadequate because of changes in conditions or the degree of compliance with the policies or
procedures may deteriorate.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting.
The Company’s system of internal controls over financial reporting is designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of the consolidated financial statements in
accordance with International Financial Reporting Standards.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements
and even when determined to be effective can provide only reasonable assurance with respect to financial statement
preparation and presentation. 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.

Our management assessed the effectiveness of the Company’s internal control over financial reporting as of
December 31, 2019. In making this assessment, management used the updated criteria set forth in 2013 by the
Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated
Framework.

127

Based on our assessment under the COSO Internal Control-Integrated Framework, management believes that, as of

December 31, 2019, our internal control over financial reporting is effective.

IndependenceRisk ManagementDisclosure Controls and ProceduresReport of Management on Internal Control over Financial ReportingFurther detailed information regarding stock options and awards granted under the plan can be found in Note 22

included in the Consolidated Financial Statements.

Unlike the New York Stock Exchange listing standards which require a majority of the Supervisory Board members to

be independent, the Dutch Corporate Governance Code distinguishes between certain independence criteria which

may be fulfilled by not more than one Supervisory Board Members (as e.g. prior employment with the Company,

receiving personal financial an important business relationship with the Company) and other criteria which may not

be fulfilled by more than the majority of the Supervisory Board members. In some cases the Dutch independence

requirement is more stringent, such as by requiring a longer “look back” period (five years) for former executive

directors. In other cases, the New York Stock Exchange rules are more stringent, such as a broader definition of

disqualifying affiliations. Currently, all members of our Supervisory Board are “independent” under both the New

York Stock Exchange and Dutch definitions.

Reference is made to the discussion in the “Risk Management” and “Risks” section above.

Our Managing Director, with the assistance of other members of management, performed an evaluation of the

effectiveness of the design and operation of our disclosure controls and procedures. Based on that evaluation, they

concluded that as of December 31, 2019, our disclosure controls and procedures were effective to ensure that

information required to be disclosed by us in the reports that we file is recorded, processed, summarized and

reported in a timely manner and is accumulated and communicated to our management, including our Managing

Directors, as appropriate to allow timely decisions regarding required disclosure.

There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, no matter how

well designed, such as the possibility of human error and the circumvention or overriding of the controls and

procedures. Therefore, even those systems determined to be effective may not prevent or detect misstatements and

can provide only reasonable assurance of achieving their control objectives. In addition, any determination of

effectiveness of controls is not a projection of any effectiveness of those controls to future periods, as those controls

may become inadequate because of changes in conditions or the degree of compliance with the policies or

procedures may deteriorate.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting.

The Company’s system of internal controls over financial reporting is designed to provide reasonable assurance

regarding the reliability of financial reporting and the preparation of the consolidated financial statements in
accordance with International Financial Reporting Standards.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements
and even when determined to be effective can provide only reasonable assurance with respect to financial statement
preparation and presentation. 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.

Our management assessed the effectiveness of the Company’s internal control over financial reporting as of
December 31, 2019. In making this assessment, management used the updated criteria set forth in 2013 by the
Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated
Framework.

Based on our assessment under the COSO Internal Control-Integrated Framework, management believes that, as of
December 31, 2019, our internal control over financial reporting is effective.

Changes in Internal Control over Financial Reporting

There has been no change in our internal control over financial reporting during 2019 that has materially affected,
or is reasonably likely to materially affect, our internal control over financial reporting.

In accordance with the requirements of Dutch law, our independent registered public accounting firm for our statutory
consolidated financial statements prepared in accordance with International Financial Reporting Standards as
adopted by the European Union and filed with the Netherlands Authority for the Financial Markets (AFM), is
appointed, and may be removed by, the General Meeting. The Supervisory Board nominates a candidate for the
appointment as external auditor, for which purpose both the Audit Committee and the Managing Board advise the
Supervisory Board. At the Annual General Meeting in 2019, KPMG Accountants N.V. was appointed as external
auditor for the Company for 2019 year. The external auditor is invited to attend the meeting of the Supervisory
Board at which the statutory financial statements prepared in accordance with International Financial Reporting
Standards and filed with the AFM shall be approved and is furthermore invited to attend the General Meeting at
which the statutory financial statements are adopted and may be questioned by the General Meeting on its statement
on the fairness of our annual accounts prepared in accordance with International Financial Reporting Standards.

Following the appointment of KPMG Accountants N.V. for the audit of our statutory consolidated financial
statements, the external auditor for our consolidated financial statements prepared under U.S. generally accepted
accounting principles is KPMG AG Wirtschaftsprüfungsgesellschaft who audited the consolidated financial
statements as of and for the year ended December 31, 2019 contained in this annual report.

The remuneration of the external auditor, and instructions to the external auditor to provide non-audit services, shall
be approved by the Supervisory Board on the recommendation of the Audit Committee and after consultation with
the Managing Board. At least once every four years, the Supervisory Board and the Audit Committee shall conduct a
thorough assessment of the functioning of the external auditor. The main conclusions of this assessment shall be
communicated to the General Meeting for the purposes of assessing the nomination for the appointment of the
external auditor.

We have a formal Whistleblower Policy concerning the reporting of alleged irregularities within QIAGEN of a
general, operational or financial nature. Furthermore, we have a published Code of Conduct that outlines business
principles for our employees and rules of conduct. The Code of Conduct can be found on our website at
www.QIAGEN.com.

In 2004, the Supervisory Board granted an option to the Dutch Foundation Stichting Preferente Aandelen QIAGEN
that allows the Foundation to acquire preference shares from QIAGEN if (i) a person has (directly or indirectly)
acquired or has expressed a desire to acquire more than 20% of our issued share capital, or (ii) a person holding at
least a 10% interest in the share capital has been designated as a hostile person by our Supervisory Board. The
option enables the Foundation to acquire preference shares equal to the number of our outstanding common shares
128
at the time of the relevant exercise of the right, less one share. When exercising the option and exercising its voting
rights on these shares, the Foundation must act in the interest of QIAGEN and the interests of our stakeholders. No

preference shares are currently outstanding.

The corporate governance structure and compliance with the Dutch Code is the joint responsibility of the Managing

Board and the Supervisory Board. They are accountable for this responsibility to the General Meeting. We continue

to seek ways to improve our corporate governance by measuring itself against international best practice. The Dutch

Code was last amended on December 8, 2016, and can be found at www.commissiecorporategovernance.nl.

Independent AuditorsWhistleblower Policy and Code of ConductAnti-Takeover MeasuresDutch Corporate Governance Code — Comply or ExplainIndependenceRisk ManagementDisclosure Controls and ProceduresReport of Management on Internal Control over Financial ReportingChanges in Internal Control over Financial Reporting

There has been no change in our internal control over financial reporting during 2019 that has materially affected,

or is reasonably likely to materially affect, our internal control over financial reporting.

In accordance with the requirements of Dutch law, our independent registered public accounting firm for our statutory

consolidated financial statements prepared in accordance with International Financial Reporting Standards as

adopted by the European Union and filed with the Netherlands Authority for the Financial Markets (AFM), is

appointed, and may be removed by, the General Meeting. The Supervisory Board nominates a candidate for the

appointment as external auditor, for which purpose both the Audit Committee and the Managing Board advise the

Supervisory Board. At the Annual General Meeting in 2019, KPMG Accountants N.V. was appointed as external

auditor for the Company for 2019 year. The external auditor is invited to attend the meeting of the Supervisory

Board at which the statutory financial statements prepared in accordance with International Financial Reporting

Standards and filed with the AFM shall be approved and is furthermore invited to attend the General Meeting at

which the statutory financial statements are adopted and may be questioned by the General Meeting on its statement

on the fairness of our annual accounts prepared in accordance with International Financial Reporting Standards.

Following the appointment of KPMG Accountants N.V. for the audit of our statutory consolidated financial

statements, the external auditor for our consolidated financial statements prepared under U.S. generally accepted

accounting principles is KPMG AG Wirtschaftsprüfungsgesellschaft who audited the consolidated financial

statements as of and for the year ended December 31, 2019 contained in this annual report.

The remuneration of the external auditor, and instructions to the external auditor to provide non-audit services, shall

be approved by the Supervisory Board on the recommendation of the Audit Committee and after consultation with

the Managing Board. At least once every four years, the Supervisory Board and the Audit Committee shall conduct a

thorough assessment of the functioning of the external auditor. The main conclusions of this assessment shall be

communicated to the General Meeting for the purposes of assessing the nomination for the appointment of the

external auditor.

C O R P O R AT E   G O V E R N A N C E   A N D   C O M P E N S AT I O N

Corporate Governance Report

We have a formal Whistleblower Policy concerning the reporting of alleged irregularities within QIAGEN of a
general, operational or financial nature. Furthermore, we have a published Code of Conduct that outlines business
principles for our employees and rules of conduct. The Code of Conduct can be found on our website at
www.QIAGEN.com.

In 2004, the Supervisory Board granted an option to the Dutch Foundation Stichting Preferente Aandelen QIAGEN
that allows the Foundation to acquire preference shares from QIAGEN if (i) a person has (directly or indirectly)
acquired or has expressed a desire to acquire more than 20% of our issued share capital, or (ii) a person holding at
least a 10% interest in the share capital has been designated as a hostile person by our Supervisory Board. The
option enables the Foundation to acquire preference shares equal to the number of our outstanding common shares
at the time of the relevant exercise of the right, less one share. When exercising the option and exercising its voting
rights on these shares, the Foundation must act in the interest of QIAGEN and the interests of our stakeholders. No
preference shares are currently outstanding.

The corporate governance structure and compliance with the Dutch Code is the joint responsibility of the Managing
Board and the Supervisory Board. They are accountable for this responsibility to the General Meeting. We continue
to seek ways to improve our corporate governance by measuring itself against international best practice. The Dutch
Code was last amended on December 8, 2016, and can be found at www.commissiecorporategovernance.nl.

Non-application of a specific best practice provision is not in itself considered objectionable by the Dutch Code and
may well be justified because of particular circumstances relevant to a company. In accordance with Dutch law, we
disclose in our Annual Report the application of the Dutch Code's principles and best practice provisions.

To the extent that we do not apply certain principles and best practice provisions, or do not intend to apply these in
the current or the subsequent year, we state the reasons.

We take a positive view of the Dutch Code and apply nearly all of the best practice provisions. However, we prefer
not to apply some provisions due to the international character of our business as well as the fact - acknowledged by
the Commission that drafted the Dutch Code - that existing contractual agreements between QIAGEN and individual
members of the Managing Board cannot be set aside at will.

The following provides an overview of exceptions that we have identified:

1. Best practice provision 2.2.2 recommends that a supervisory board member is appointed for a period of four
years. A member may be reappointed for a term of additional two years, which appointment may be extended by at
most two years.

Members of the Supervisory Board are appointed annually for a one-year period beginning on the day following the
General Meeting up to and including the day of the General Meeting held in the following year. Further, Dr. Metin
Colpan has joined the Supervisory Board in 2004. We value the profound industry experience of Dr. Colpan and
his in-depth knowledge of QIAGEN. QIAGEN therefore supports the reappointment of Dr. Colpan beyond the eight-
year term as recommended by the Dutch Code.

2. Best practice provision 2.1.5 recommends that the Supervisory Board should draw up a diversity policy for the
composition of the Management Board, the Supervisory Board and, if applicable, the Executive Committee. The
policy should address concrete targets relating to diversity and the diversity aspects to the Company, such as
nationality, age, gender and education and work background.

While QIAGEN strives for a diverse composition of the Supervisory Board, Managing Board, Executive Committee
and in all other management levels of the Company, we do not consider the definition of concrete targets relating to
diversity useful. We are committed to creating an environment where all individuals have the opportunity to grow
and contribute to our progress, regardless of their age, educational background, gender, nationality, physical
abilities, race and ethical background, religion, or sexual orientation. We consider it to be a key success factor on
the path to achieving our mission and goals. Individuals and teams alike understand the diverse needs of our
customers, identify and realize cross-functional opportunities for our business areas, and can quickly adapt to a fast
changing environment. In 2019, our multicultural workforce was composed of at least 70 nationalities with an

129

average age of 40.3. With 49% women, we are well balanced in terms of gender on an aggregate levelInformation

on the composition of our Managing and Supervisory Boards can be found above and more information on gender

diversity within the Managing and Supervisory Board can be found about under the section "Diversity within the

Managing Board and Supervisory Board."

3. Best practice provision 3.1.2 vi. recommends that when formulating the remuneration policy, it should be

considered that shares awarded to management board should be held for a period of at least five years

Pursuant to the Company’s Remuneration Policy, long-term equity-based grants to members of the Managing Board

under the 2014 Plan primarily consist of an award of performance stock units, i.e. long-term incentive awards which

are dependent upon the achievement of pre-defined performance goals. Grants of restricted stock units, which are

based on time vesting only, are no longer to be granted on a regular basis and shall be reserved for use as special

equity incentive rewards in certain situations. Performance stock units and restricted stock units granted until February

2018 are basically structured so that 40% of a grant vests after three years, 50% after five years and the remaining

10% after ten years. Grants of performance stock units and restricted stock units granted after February 2018 vest

40% after three years, 60% after five years. In 2019, the members of the Managing Board elected to receive in lieu

of their 2018 cash bonus the value earned in the year in performance stock units which vest over five years from the

grant date.

Independent AuditorsWhistleblower Policy and Code of ConductAnti-Takeover MeasuresDutch Corporate Governance Code — Comply or ExplainNon-application of a specific best practice provision is not in itself considered objectionable by the Dutch Code and

may well be justified because of particular circumstances relevant to a company. In accordance with Dutch law, we

disclose in our Annual Report the application of the Dutch Code's principles and best practice provisions.

To the extent that we do not apply certain principles and best practice provisions, or do not intend to apply these in

the current or the subsequent year, we state the reasons.

We take a positive view of the Dutch Code and apply nearly all of the best practice provisions. However, we prefer

not to apply some provisions due to the international character of our business as well as the fact - acknowledged by

the Commission that drafted the Dutch Code - that existing contractual agreements between QIAGEN and individual

members of the Managing Board cannot be set aside at will.

The following provides an overview of exceptions that we have identified:

1. Best practice provision 2.2.2 recommends that a supervisory board member is appointed for a period of four

years. A member may be reappointed for a term of additional two years, which appointment may be extended by at

most two years.

Members of the Supervisory Board are appointed annually for a one-year period beginning on the day following the

General Meeting up to and including the day of the General Meeting held in the following year. Further, Dr. Metin

Colpan has joined the Supervisory Board in 2004. We value the profound industry experience of Dr. Colpan and
his in-depth knowledge of QIAGEN. QIAGEN therefore supports the reappointment of Dr. Colpan beyond the eight-
year term as recommended by the Dutch Code.

2. Best practice provision 2.1.5 recommends that the Supervisory Board should draw up a diversity policy for the
composition of the Management Board, the Supervisory Board and, if applicable, the Executive Committee. The
policy should address concrete targets relating to diversity and the diversity aspects to the Company, such as
nationality, age, gender and education and work background.

While QIAGEN strives for a diverse composition of the Supervisory Board, Managing Board, Executive Committee
and in all other management levels of the Company, we do not consider the definition of concrete targets relating to
diversity useful. We are committed to creating an environment where all individuals have the opportunity to grow
and contribute to our progress, regardless of their age, educational background, gender, nationality, physical
abilities, race and ethical background, religion, or sexual orientation. We consider it to be a key success factor on
the path to achieving our mission and goals. Individuals and teams alike understand the diverse needs of our
customers, identify and realize cross-functional opportunities for our business areas, and can quickly adapt to a fast
changing environment. In 2019, our multicultural workforce was composed of at least 70 nationalities with an
average age of 40.3. With 49% women, we are well balanced in terms of gender on an aggregate levelInformation
on the composition of our Managing and Supervisory Boards can be found above and more information on gender
diversity within the Managing and Supervisory Board can be found about under the section "Diversity within the
Managing Board and Supervisory Board."

3. Best practice provision 3.1.2 vi. recommends that when formulating the remuneration policy, it should be
considered that shares awarded to management board should be held for a period of at least five years

Pursuant to the Company’s Remuneration Policy, long-term equity-based grants to members of the Managing Board
under the 2014 Plan primarily consist of an award of performance stock units, i.e. long-term incentive awards which
are dependent upon the achievement of pre-defined performance goals. Grants of restricted stock units, which are
based on time vesting only, are no longer to be granted on a regular basis and shall be reserved for use as special
equity incentive rewards in certain situations. Performance stock units and restricted stock units granted until February
2018 are basically structured so that 40% of a grant vests after three years, 50% after five years and the remaining
10% after ten years. Grants of performance stock units and restricted stock units granted after February 2018 vest
40% after three years, 60% after five years. In 2019, the members of the Managing Board elected to receive in lieu
of their 2018 cash bonus the value earned in the year in performance stock units which vest over five years from the
grant date.

4. Best practice provision 3.2.3 recommends that the maximum remuneration in the event of dismissal of a
management board member may not exceed one year's salary (the "fixed" remuneration component).

Our Managing Board members have entered into employment agreements with QIAGEN N.V. and some QIAGEN
affiliates for which they hold managing positions. In case of termination of an agreement without serious cause as
defined by the applicable law, the respective affiliate would remain obliged to compensate the Managing Board
member for the remaining term of the employment agreement. QIAGEN believes that these contractual arrangements
are well justified due to the long tenures of the Managing Board members.

5. Best practice provision 2.2.4 recommends that the supervisory board should draw up a retirement schedule in
order to avoid, as far as possible, a situation in which many supervisory board members retire simultaneously. The
retirement schedule should be made generally available and should be posted on the company’s website.

The Supervisory Board follows the practice to discuss retirement plans of individual members early to proactively
manage continuity within the Supervisory Board. QIAGEN believes that this practice provides a more flexible and
better succession planning than a fixed retirement schedule.

6. Best practice provision 3.3.2 recommends that a supervisory board member may not be granted any shares
and/or rights to shares by way of remuneration.

QIAGEN has granted stock options to the members of the Supervisory Board as a remuneration component since its
establishment until 2013 when we stopped granting stock options. Since 2007, Supervisory Board members have
been granted restricted stock units. We believe that the reasonable level of equity-based compensation which we
practice allows a positive alignment of shareholder interests with the other duties of the Supervisory Board and that
this practice is necessary to attract and retain Supervisory Board members as the granting of share-based
130
compensation to Supervisory Board members is a common practice in our industry.

Exemptions from the NYSE corporate governance standards are available to foreign private issuers, such as

QIAGEN when those standards are contrary to a law, rule or regulation of any public authority exercising

jurisdiction over such issuer or contrary to generally accepted business practices in the issuer’s country of domicile. In

connection with QIAGEN’s listing on the NYSE, the NYSE accepted QIAGEN's exemptions from certain corporate

governance standards that are contrary to the laws, rules, regulations or generally accepted business practices of

The Netherlands. These exemptions and the practices followed by QIAGEN are described below:

›

QIAGEN is exempt from NYSE’s quorum requirements applicable to meetings of ordinary shareholders. In keeping

with the law of The Netherlands and generally accepted business practices in The Netherlands, QIAGEN’s Articles

of Association provide that there are no quorum requirements generally applicable to meetings of the General

Meeting.

›

QIAGEN is exempt from NYSE’s requirements that shareholder approval be obtained prior to the establishment of,

or material amendments to, stock option or purchase plans and other equity compensation arrangements pursuant

to which options or stock may be acquired by directors, officers, employees or consultants. QIAGEN is also

exempt from NYSE’s requirements that shareholder approval be obtained prior to certain issuances of stock

resulting in a change of control, occurring in connection with acquisitions of stock or assets of another company or

issued at a price less than the greater of book or market value other than in a public offering. QIAGEN’s Articles

of Association do not require approval of the General Meeting prior to the establishment of a stock plan. The

Articles of Association also permit the General Meeting to grant the Supervisory Board general authority to issue

shares without further approval of the General Meeting. QIAGEN’s General Meeting has granted the Supervisory

Board general authority to issue up to a maximum of our authorized capital without further approval of the

General Meeting. QIAGEN plans to seek approval of the General Meetings for stock plans and stock issuances

only where required under the law of The Netherlands or under QIAGEN’s Articles of Association.

NYSE Exemptions4. Best practice provision 3.2.3 recommends that the maximum remuneration in the event of dismissal of a

management board member may not exceed one year's salary (the "fixed" remuneration component).

Our Managing Board members have entered into employment agreements with QIAGEN N.V. and some QIAGEN

affiliates for which they hold managing positions. In case of termination of an agreement without serious cause as

defined by the applicable law, the respective affiliate would remain obliged to compensate the Managing Board

member for the remaining term of the employment agreement. QIAGEN believes that these contractual arrangements

are well justified due to the long tenures of the Managing Board members.

5. Best practice provision 2.2.4 recommends that the supervisory board should draw up a retirement schedule in

order to avoid, as far as possible, a situation in which many supervisory board members retire simultaneously. The

retirement schedule should be made generally available and should be posted on the company’s website.

Corporate Governance Report
C O R P O R AT E   G O V E R N A N C E   A N D   C O M P E N S AT I O N
The Supervisory Board follows the practice to discuss retirement plans of individual members early to proactively
manage continuity within the Supervisory Board. QIAGEN believes that this practice provides a more flexible and
better succession planning than a fixed retirement schedule.

6. Best practice provision 3.3.2 recommends that a supervisory board member may not be granted any shares
and/or rights to shares by way of remuneration.

QIAGEN has granted stock options to the members of the Supervisory Board as a remuneration component since its
establishment until 2013 when we stopped granting stock options. Since 2007, Supervisory Board members have
been granted restricted stock units. We believe that the reasonable level of equity-based compensation which we
practice allows a positive alignment of shareholder interests with the other duties of the Supervisory Board and that
this practice is necessary to attract and retain Supervisory Board members as the granting of share-based
compensation to Supervisory Board members is a common practice in our industry.

Exemptions from the NYSE corporate governance standards are available to foreign private issuers, such as
QIAGEN when those standards are contrary to a law, rule or regulation of any public authority exercising
jurisdiction over such issuer or contrary to generally accepted business practices in the issuer’s country of domicile. In
connection with QIAGEN’s listing on the NYSE, the NYSE accepted QIAGEN's exemptions from certain corporate
governance standards that are contrary to the laws, rules, regulations or generally accepted business practices of
The Netherlands. These exemptions and the practices followed by QIAGEN are described below:

›

›

QIAGEN is exempt from NYSE’s quorum requirements applicable to meetings of ordinary shareholders. In keeping
with the law of The Netherlands and generally accepted business practices in The Netherlands, QIAGEN’s Articles
of Association provide that there are no quorum requirements generally applicable to meetings of the General
Meeting.

QIAGEN is exempt from NYSE’s requirements that shareholder approval be obtained prior to the establishment of,
or material amendments to, stock option or purchase plans and other equity compensation arrangements pursuant
to which options or stock may be acquired by directors, officers, employees or consultants. QIAGEN is also
exempt from NYSE’s requirements that shareholder approval be obtained prior to certain issuances of stock
resulting in a change of control, occurring in connection with acquisitions of stock or assets of another company or
issued at a price less than the greater of book or market value other than in a public offering. QIAGEN’s Articles
of Association do not require approval of the General Meeting prior to the establishment of a stock plan. The
Articles of Association also permit the General Meeting to grant the Supervisory Board general authority to issue
shares without further approval of the General Meeting. QIAGEN’s General Meeting has granted the Supervisory
Board general authority to issue up to a maximum of our authorized capital without further approval of the
General Meeting. QIAGEN plans to seek approval of the General Meetings for stock plans and stock issuances
only where required under the law of The Netherlands or under QIAGEN’s Articles of Association.

131

NYSE ExemptionsFinancial
Results

134 Consolidated Financial Statements

142 Notes to Consolidated Financial Statements

206 Auditor’s Report

212 List of Subsidiaries

Financial Results
Financial Results
Financial Results

Financial Results
Financial Results

Financial Results
Auditor’s Report
Consolidated Financial Statements
Financial Results

Financial Results
Financial Results

QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands)
QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands)

QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands)
QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands)
Report of independent registered public accounting firm

To the Shareholders and Supervisory Board

QIAGEN N.V.:

Current assets:
Current assets:

Current assets:
Current assets:

Cash and cash equivalents
Cash and cash equivalents

Cash and cash equivalents
Cash and cash equivalents

(3)
(3)

(3)
(3)

$ 623,647
$ 623,647

$ 623,647
$ 623,647

$ 1,159,079
$ 1,159,079

$ 1,159,079
$ 1,159,079

Restricted cash
Restricted cash

Restricted cash
Restricted cash

Short-term investments
Short-term investments

Short-term investments
Short-term investments

We have audited the accompanying consolidated balance sheets of QIAGEN N.V. and subsidiaries (the
5,743
5,743
“Company”) as of December 31, 2019 and 2018, the related consolidated statements of (loss) income,
234,606
129,586
234,606
129,586
comprehensive (loss) income, changes in equity, and cash flows for each of the years in the three-year period ended
December 31, 2019, and the related notes and financial statement schedule as listed in Item 18 (A) (collectively, the
351,612
351,612
consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material
respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its
42,119
42,119
operations and its cash flows for each of the years in the three-year period ended December 31, 2019, in conformity
with U.S. generally accepted accounting principles.

Accounts receivable, net of allowance for doubtful accounts of $12,115 and $9,270 in 2019 and
Accounts receivable, net of allowance for doubtful accounts of $12,115 and $9,270 in 2019 and
2018, respectively
2018, respectively

Accounts receivable, net of allowance for doubtful accounts of $12,115 and $9,270 in 2019 and
Accounts receivable, net of allowance for doubtful accounts of $12,115 and $9,270 in 2019 and
2018, respectively
2018, respectively

Income taxes receivable
Income taxes receivable

Income taxes receivable
Income taxes receivable

Inventories, net
Inventories, net

Inventories, net
Inventories, net

170,704
170,704

129,586
129,586

385,117
385,117

385,117
385,117

170,704
170,704

162,912
162,912

42,119
42,119

34,936
34,936

(3, 24)
(3, 24)

5,743
5,743

(3, 24)
(3, 24)

(7)
(7)

(3)
(3)

(3)
(3)

(7)
(7)

(3)
(3)

(3)
(3)

—
—

234,606
234,606

351,612
351,612

162,912
162,912

34,936
34,936

—
—

Fair value of derivative instruments — current
Fair value of derivative instruments — current

Fair value of derivative instruments — current
Fair value of derivative instruments — current

(14)
(14)

(14)
(14)

107,868
107,868

107,868
107,868

102,754
102,754

102,754
102,754

Prepaid expenses and other current assets (of which $13,697 and $3,873 in 2019 and 2018 due from
Prepaid expenses and other current assets (of which $13,697 and $3,873 in 2019 and 2018 due
related parties, respectively)
from related parties, respectively)

Prepaid expenses and other current assets (of which $13,697 and $3,873 in 2019 and 2018 due
Prepaid expenses and other current assets (of which $13,697 and $3,873 in 2019 and 2018 due
from related parties, respectively)
from related parties, respectively)

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2019, based on
criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring
Organizations of the Treadway Commission, and our report dated February 28, 2020 expressed an unqualified
opinion on the effectiveness of the Company’s internal control over financial reporting.
(9)
Property, plant and equipment, net of accumulated depreciation of $699,130 and $603,430 in
Property, plant and equipment, net of accumulated depreciation of $699,130 and $603,430 in
(9)
2019 and 2018, respectively
2019 and 2018, respectively

Property, plant and equipment, net of accumulated depreciation of $699,130 and $603,430 in 2019
Property, plant and equipment, net of accumulated depreciation of $699,130 and $603,430 in
and 2018, respectively
2019 and 2018, respectively

Long-term assets:
Long-term assets:

Long-term assets:
Long-term assets:

1,570,248
1,570,248

2,155,060
2,155,060

1,570,248
1,570,248

105,464
105,464

455,243
455,243

455,243
455,243

511,659
511,659

105,464
105,464

109,161
109,161

(8)
(8)

(9)
(9)

(8)
(8)

2,155,060
2,155,060

109,161
109,161

511,659
511,659

Goodwill
Goodwill

Goodwill
Goodwill

(11)
(11)

(11)
(11)

2,140,503
2,140,503

2,140,503
2,140,503

2,108,536
2,108,536

2,108,536
2,108,536

Intangible assets, net of accumulated amortization of $776,520 and $1,194,679 in 2019 and
Intangible assets, net of accumulated amortization of $776,520 and $1,194,679 in 2019 and
2018, respectively
2018, respectively

Intangible assets, net of accumulated amortization of $776,520 and $1,194,679 in 2019 and 2018,
Intangible assets, net of accumulated amortization of $776,520 and $1,194,679 in 2019 and
respectively
2018, respectively

475,043
475,043
As discussed in Note 2 to the consolidated financial statements, the Company has changed its method of accounting
for leases in 2019 due to the adoption of Accounting Standards Codification Topic 842 - Leases. In 2018, the
Company has changed its method of accounting for revenue from contracts with customers due to the adoption of
Accounting Standards Codification Topic 606 - Revenue from Contracts with Customers.
(14)
(14)

Fair value of derivative instruments — long-term
Fair value of derivative instruments — long-term

Fair value of derivative instruments — long-term
Fair value of derivative instruments — long-term

Deferred income tax assets
Deferred income tax assets

Deferred income tax assets
Deferred income tax assets

632,434
632,434

192,266
192,266

632,434
632,434

192,266
192,266

295,363
295,363

56,542
56,542

56,542
56,542

42,896
42,896

(17)
(17)

(11)
(11)

(14)
(14)

(17)
(17)

(11)
(11)

42,896
42,896

295,363
295,363

475,043
475,043

Other long-term assets (of which $16,830 and $24,300 in 2019 and 2018 due from related parties,
Other long-term assets (of which $16,830 and $24,300 in 2019 and 2018 due from related
Other long-term assets (of which $16,830 and $24,300 in 2019 and 2018 due from related
Other long-term assets (of which $16,830 and $24,300 in 2019 and 2018 due from related
respectively)
parties, respectively)
parties, respectively)
parties, respectively)

(10, 12, 24)
(10, 12, 24)

(10, 12, 24)
(10, 12, 24)

188,380
188,380

188,380
188,380

159,775
159,775

159,775
159,775

3,593,272
3,593,272
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to
$ 5,748,332
$ 5,748,332
express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm
registered with the PCAOB and are required to be independent with respect to the Company in accordance with the
The accompanying notes are an integral part of these consolidated financial statements.
The accompanying notes are an integral part of these consolidated financial statements.
U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and
the PCAOB.

The accompanying notes are an integral part of these consolidated financial statements.
The accompanying notes are an integral part of these consolidated financial statements.

$ 5,235,616
$ 5,235,616

$ 5,235,616
$ 5,235,616

3,665,368
3,665,368

3,665,368
3,665,368

$ 5,748,332
$ 5,748,332

3,593,272
3,593,272

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of
material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks
of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing
procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the
amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting

134

NoteAs of December 31,20192018AssetsTotal current assetsTotal long-term assetsTotal assetsOpinion on the Consolidated Financial StatementsChange in Accounting PrincipleBasis for OpinionNoteAs of December 31,20192018AssetsTotal current assetsTotal long-term assetsTotal assetsNoteAs of December 31,20192018AssetsTotal current assetsTotal long-term assetsTotal assetsNoteAs of December 31,20192018AssetsTotal current assetsTotal long-term assetsTotal assetsF I N A N C I A L   R E S U LT S

Consolidated Financial Statements

Financial Results

Financial Results
Financial Results

Financial Results
Financial Results

Financial Results
QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands, except
par value)
QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands)
QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands)
QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in thousands)

Current liabilities:
Current assets:

Current assets:
Current assets:

Current portion of long-term debt
Cash and cash equivalents
Cash and cash equivalents
Cash and cash equivalents

Accounts payable
Restricted cash

Restricted cash
Restricted cash

Fair value of derivative instruments — current
Short-term investments

Short-term investments
Short-term investments

(16)
(3)

(3)
(3)

$ 285,244
$ 623,647

$ 623,647
$ 623,647

$ 503,116
$ 1,159,079

$ 1,159,079
$ 1,159,079

(24)
(3)

(3)
(3)

84,767
5,743

5,743
5,743

69,415
—

—
—

(14)
(7)

(7)
(7)

103,175
129,586

129,586
129,586

106,594
234,606

234,606
234,606

Accrued and other current liabilities (of which $15,404 and $5,488 due to related parties in 2019 and
Accounts receivable, net of allowance for doubtful accounts of $12,115 and $9,270 in 2019 and
2018, respectively)
2018, respectively

Accounts receivable, net of allowance for doubtful accounts of $12,115 and $9,270 in 2019 and
Accounts receivable, net of allowance for doubtful accounts of $12,115 and $9,270 in 2019 and
2018, respectively
2018, respectively

(10, 13, 22)
(3, 24)

(3, 24)
(3, 24)

444,303
385,117

385,117
385,117

263,017
351,612

351,612
351,612

33,856
42,119

42,119
42,119

30,047
34,936

34,936
34,936

Income taxes payable
Income taxes receivable

Income taxes receivable
Income taxes receivable

Inventories, net

Inventories, net
Inventories, net

Long-term liabilities:

Fair value of derivative instruments — current

Fair value of derivative instruments — current
Fair value of derivative instruments — current

Prepaid expenses and other current assets (of which $13,697 and $3,873 in 2019 and 2018 due
Prepaid expenses and other current assets (of which $13,697 and $3,873 in 2019 and 2018 due
Prepaid expenses and other current assets (of which $13,697 and $3,873 in 2019 and 2018 due
Long-term debt, net of current portion
from related parties, respectively)
from related parties, respectively)
from related parties, respectively)
Deferred income tax liabilities

Long-term assets:

Fair value of derivative instruments — long-term
Long-term assets:
Long-term assets:
Other long-term liabilities
Property, plant and equipment, net of accumulated depreciation of $699,130 and $603,430 in
2019 and 2018, respectively

Property, plant and equipment, net of accumulated depreciation of $699,130 and $603,430 in
Property, plant and equipment, net of accumulated depreciation of $699,130 and $603,430 in
2019 and 2018, respectively
2019 and 2018, respectively

Commitments and contingencies

Goodwill
Goodwill

Goodwill

Equity:

Intangible assets, net of accumulated amortization of $776,520 and $1,194,679 in 2019 and
Intangible assets, net of accumulated amortization of $776,520 and $1,194,679 in 2019 and
2018, respectively
2018, respectively

Intangible assets, net of accumulated amortization of $776,520 and $1,194,679 in 2019 and
2018, respectively
Preference shares, 0.01 EUR par value, authorized—450,000 shares, no shares issued and outstanding
Deferred income tax assets
Financing preference shares, 0.01 EUR par value, authorized—40,000 shares, no shares issued and
outstanding
Fair value of derivative instruments — long-term

Fair value of derivative instruments — long-term
Fair value of derivative instruments — long-term

Deferred income tax assets
Deferred income tax assets

(3)

(3)
(3)

170,704
951,345

170,704
170,704

162,912
972,189

162,912
162,912

(14)

(14)
(14)

107,868

107,868
107,868

102,754

102,754
102,754

(8)
(16)

(8)
(8)

105,464
1,421,108

105,464
105,464

109,161
1,671,090

109,161
109,161

(16)

(14)

(12, 15)
(9)

(9)
(9)

23,442
1,570,248
1,570,248
1,570,248
196,929

63,411
2,155,060
2,155,060
2,155,060
317,393

106,201
455,243
1,747,680

455,243
455,243

89,279
511,659
2,141,173

511,659
511,659

(20)
(11)

(11)
(11)

2,140,503

2,140,503
2,140,503

2,108,536

2,108,536
2,108,536

(11)

(11)
(11)

632,434

632,434
632,434

475,043

475,043
475,043

(17)

(17)
(17)

(14)

(14)
(14)

—
56,542
56,542
56,542
—
192,266
192,266
192,266

—
42,896
42,896
42,896
—
295,363
295,363
295,363

Common Shares, 0.01 EUR par value, authorized—410,000 shares, issued — 230,829 shares in
Other long-term assets (of which $16,830 and $24,300 in 2019 and 2018 due from related
Other long-term assets (of which $16,830 and $24,300 in 2019 and 2018 due from related
Other long-term assets (of which $16,830 and $24,300 in 2019 and 2018 due from related
2019 and 2018, respectively
parties, respectively)
parties, respectively)
parties, respectively)

(10, 12, 24)

(10, 12, 24)
(10, 12, 24)

2,702
188,380
188,380
188,380

2,702
159,775
159,775
159,775

Additional paid-in capital

Retained earnings

The accompanying notes are an integral part of these consolidated financial statements.

Accumulated other comprehensive loss
The accompanying notes are an integral part of these consolidated financial statements.
The accompanying notes are an integral part of these consolidated financial statements.
Less treasury shares, at cost— 3,077 and 5,320 shares in 2019 and 2018, respectively

(18)

(18)

The accompanying notes are an integral part of these consolidated financial statements.

1,777,017
3,665,368

3,665,368
3,665,368

1,742,191
3,593,272

3,593,272
3,593,272

1,178,457
$ 5,235,616

$ 5,235,616
$ 5,235,616

1,379,624
$ 5,748,332

$ 5,748,332
$ 5,748,332

(309,619)

(310,644)

(111,966)

(178,903)

2,536,591

2,634,970

$ 5,235,616

$ 5,748,332

135

NoteAs of December 31,20192018Liabilities and equityTotal current liabilitiesTotal long-term liabilitiesTotal equityTotal liabilities and equityNoteAs of December 31,20192018AssetsTotal current assetsTotal long-term assetsTotal assetsNoteAs of December 31,20192018AssetsTotal current assetsTotal long-term assetsTotal assetsNoteAs of December 31,20192018AssetsTotal current assetsTotal long-term assetsTotal assets(in thousands, except per share data)

Net sales

Cost of sales

Cost of sales

Acquisition-related intangible amortization

Operating expenses:

Research and development

Sales and marketing

General and administrative

Acquisition-related intangible amortization

Restructuring, acquisition, integration and other, net

Long-lived asset impairments

Other income (expense):

Interest income

Interest expense

Other income (expense), net

(Loss) income before income tax (benefit) expense

Income tax (benefit) expense

Weighted-average common shares outstanding

Basic

Diluted

QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF (LOSS) INCOME

QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF (LOSS) INCOME
QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF (LOSS) INCOME
(in thousands, except per share data)
(in thousands, except per share data)

QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF (LOSS) INCOME
(in thousands, except per share data)

QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF (LOSS) INCOME
(in thousands, except per share data)

Net sales

Net sales

Net sales

Net sales

(3, 4, 24)

(3, 4, 24)

(3, 4, 24)

(3, 4, 24)

(3, 4, 24)

$ 1,526,424 $ 1,501,848

$ 1,526,424 $ 1,501,848

$ 1,417,536

$ 1,417,536

$ 1,417,536

$ 1,526,424

$ 1,417,536

$ 1,501,848

$ 1,526,424

$ 1,501,848

$ 1,526,424

$ 1,501,848

Cost of sales

Cost of sales

Cost of sales

Cost of sales

Cost of sales

Cost of sales

Cost of sales

Cost of sales

Acquisition-related intangible amortization

Acquisition-related intangible amortization

Acquisition-related intangible amortization

Acquisition-related intangible amortization

Operating expenses:

Operating expenses:

Operating expenses:

Operating expenses:

Research and development

Research and development

Research and development

Research and development

Sales and marketing

Sales and marketing

Sales and marketing

Sales and marketing

General and administrative

General and administrative

General and administrative

General and administrative

(3)

(3)

(3)

(3)

(3)

(3)

(3)

(3)

(3)

(3)

Acquisition-related intangible amortization

Acquisition-related intangible amortization

Acquisition-related intangible amortization

Acquisition-related intangible amortization

Restructuring, acquisition, integration and other, net

Restructuring, acquisition, integration and other, net

Restructuring, acquisition, integration and other, net
(6)

Restructuring, acquisition, integration and other, net

Long-lived asset impairments

Long-lived asset impairments

Long-lived asset impairments

Long-lived asset impairments

(6)

(6)

(6)

(6)

(6)

(6)

(6)

(6)

(6)

Other income (expense):

Other income (expense):

Other income (expense):

Other income (expense):

Interest income

Interest income

Interest income

Interest income

Interest expense

Interest expense

Interest expense

Interest expense

Other income (expense), net

Other income (expense), net

Other income (expense), net

Other income (expense), net

(6)

(6)

(6)

(6)

(6)

449,651

449,651

449,651

449,651

422,226
449,651

444,165

422,226

444,165

444,165

444,165

422,226

422,226

71,511

71,511

71,511

71,511

56,723
72,749
71,511

72,749

56,723

56,723

56,723

72,749

72,749

521,162

521,162

521,162

521,162

494,975
521,162

500,888

494,975

500,888

500,888

500,888

494,975

494,975

1,005,262

922,561
1,000,960
1,005,262
1,005,262

1,000,960

1,000,960

1,005,262

1,000,960

1,005,262

922,561

922,561

922,561

157,448

157,448

157,448

157,448

154,084
157,448

161,852

154,084

161,852

161,852

161,852

154,084

154,084

391,906

391,906

391,906

391,906

375,562
391,906

392,281

375,562

392,281

392,281

392,281

375,562

375,562

112,262

112,262

112,262

112,262

102,080
112,262

104,568

102,080

104,568

104,568

104,568

102,080

102,080

29,973

29,973

29,973

29,973

39,032
39,398
29,973

39,032

39,398

39,032

39,032

39,398

39,398

199,778

199,778

199,778

199,778

98,018
199,778

98,018

28,659

28,659

28,659

28,659

98,018

98,018

1,031,398

769,142
734,379
1,031,398
1,031,398

1,031,398

1,031,398

734,379

769,142

734,379

734,379

769,142

769,142

(26,136)

(26,136)

(26,136)

(26,136)

153,419
(26,136)

153,419

266,581

266,581

266,581

266,581

153,419

153,419

22,113

22,113

22,113

22,113

20,851
10,645
22,113

20,851

10,645

20,851

20,851

10,645

10,645

(74,185)

(74,185)

(74,185)

(74,185)

(49,685
(74,185)

(67,293)

(67,293)

(67,293)

(67,293)

(49,685

(49,685

(49,685

140,031

140,031

140,031

140,031

—
140,031

7,987

7,987

7,987

7,987

—

—

—

7,987

—

432

432

432

432

5,598

5,598

5,598

5,598
(4)
432

(4)

(4)

(4)

5,598

(4)

444,165

422,226

56,723

72,749

500,888

494,975

1,000,960

922,561

$ 1,417,536

161,852

154,084

392,281

375,562

104,568

102,080

39,032

39,398

28,659

98,018

734,379

769,142

266,581

153,419

20,851

10,645

(67,293)

(49,685

(40,844)

(39,044)

225,737

114,375

35,357

73,981

190,380

40,394

$ 0.84

$ 0.18

$ 0.82

$ 0.17

226,640

228,074

233,456

233,009

The accompanying notes are an integral part of these consolidated financial statements.

The accompanying notes are an integral part of these consolidated financial statements.
The accompanying notes are an integral part of these consolidated financial statements.

The accompanying notes are an integral part of these consolidated financial statements.

The accompanying notes are an integral part of these consolidated financial statements.

136

Diluted

Diluted

Diluted

Diluted

(19)

(19)

(19)

(19)

(19)

226,777

226,777

226,777

226,777

233,009
226,777

233,456

233,009

233,456

233,456

233,456

233,009

233,009

(Loss) income before income tax (benefit) expense

(Loss) income before income tax (benefit) expense

(Loss) income before income tax (benefit) expense

(Loss) income before income tax (benefit) expense

Income tax (benefit) expense

Income tax (benefit) expense

Income tax (benefit) expense

Income tax (benefit) expense

(3, 17)

(3, 17)

(3, 17)

(3, 17)

(3, 17)

(19)

(19)

(19)

(19)

(19)

(19)

(19)

(19)

(19)

(19)

Weighted-average common shares outstanding

Weighted-average common shares outstanding

Weighted-average common shares outstanding

Weighted-average common shares outstanding

Basic

Basic

Basic

Basic

(19)

(19)

(19)

(19)

(19)

(51,640)

(51,640)

(51,640)

(51,640)

(39,044)
(51,640)

(40,844)

(39,044)

(40,844)

(40,844)

(40,844)

(39,044)

(39,044)

(77,776)

(77,776)

(77,776)

(77,776)

114,375
(77,776)

225,737

114,375

225,737

225,737

225,737

114,375

114,375

(36,321)

(36,321)

(36,321)

(36,321)

73,981
(36,321)

35,357

73,981

35,357

35,357

35,357

73,981

73,981

(41,455)

(41,455)

(41,455)

(41,455)

40,394
(41,455)

190,380

190,380

190,380

190,380

40,394

40,394

40,394

$ (0.18)

$ (0.18)

$ (0.18)

$ (0.18)

$ 0.18
$ (0.18)

$ 0.84

$ 0.18

$ 0.84

$ 0.84

$ 0.84

$ 0.18

$ 0.18

$ (0.18)

$ (0.18)

$ (0.18)

$ (0.18)

$ 0.17
$ (0.18)

$ 0.82

$ 0.17

$ 0.82

$ 0.82

$ 0.82

$ 0.17

$ 0.17

226,777

226,777

226,777

226,777

228,074
226,777

226,640

228,074

226,640

226,640

226,640

228,074

228,074

NoteYears ended December 31,201920182017Total cost of salesGross profitTotal operating expenses(Loss) income from operationsTotal other expense, netNet (loss) incomeBasic (loss) earnings per common shareDiluted (loss) earnings per common shareNoteYears ended December 31,201920182017Total cost of salesGross profitTotal operating expenses(Loss) income from operationsTotal other expense, netNet (loss) incomeBasic (loss) earnings per common shareDiluted (loss) earnings per common shareNoteYears ended December 31,201920182017Total cost of salesGross profitTotal operating expenses(Loss) income from operationsTotal other expense, netNet (loss) incomeBasic (loss) earnings per common shareDiluted (loss) earnings per common shareNoteYears ended December 31,201920182017Total cost of salesGross profitTotal operating expenses(Loss) income from operationsTotal other expense, netNet (loss) incomeBasic (loss) earnings per common shareDiluted (loss) earnings per common shareNoteYears ended December 31,201920182017Total cost of salesGross profitTotal operating expenses(Loss) income from operationsTotal other expense, netNet (loss) incomeBasic (loss) earnings per common shareDiluted (loss) earnings per common share 
 
 
 
 
F I N A N C I A L   R E S U LT S

Consolidated Financial Statements

QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE
QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE
(LOSS) INCOME (in thousands)
(LOSS) INCOME (in thousands)

Other comprehensive income (loss) to be reclassified to profit or loss in subsequent
Other comprehensive income (loss) to be reclassified to profit or loss in subsequent
periods:
periods:

Gains (losses) on cash flow hedges, before tax
Gains (losses) on cash flow hedges, before tax

Cash flow hedges, before tax
Cash flow hedges, before tax

Losses on marketable securities, before tax
Losses on marketable securities, before tax

Gains on pensions, before tax
Gains on pensions, before tax

$ (41,455)
$ (41,455)

$ 190,380
$ 190,380

$ 40,394
$ 40,394

(14)
(14)

(14)
(14)

17,052
17,052

25,207
25,207

(50,067)
(50,067)

(3,888)
(3,888)

(9,774)
(9,774)

26,136
26,136

13,164
13,164

15,433
15,433

(23,931)
(23,931)

—
—

—
—

(796)
(796)

1,325
1,325

(854)
(854)

886
886

Foreign currency translation adjustments, before tax
Foreign currency translation adjustments, before tax

(12,156)
(12,156)

(108,045)
(108,045)

135,945
135,945

Other comprehensive income (loss), before tax
Other comprehensive income (loss), before tax

Income tax relating to components of other comprehensive income (loss)
Income tax relating to components of other comprehensive income (loss)

212
212

813
813

(91,287)
(91,287)

112,046
112,046

460
460

1,034
1,034

1,025
1,025

(90,827)
(90,827)

113,080
113,080

Comprehensive (loss) income
Comprehensive (loss) income

$ (40,430)
$ (40,430)

$ 99,553
$ 99,553

$ 153,474
$ 153,474

The accompanying notes are an integral part of these consolidated financial statements.
The accompanying notes are an integral part of these consolidated financial statements.

QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN
137
EQUITY

NoteYears ended December 31,201920182017Net (loss) incomeReclassification adjustments on cash flow hedges, before taxTotal other comprehensive income (loss), after taxNoteYears ended December 31,201920182017Net (loss) incomeReclassification adjustments on cash flow hedges, before taxTotal other comprehensive income (loss), after taxQIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF COMPREHENSIVE

(LOSS) INCOME (in thousands)

Other comprehensive income (loss) to be reclassified to profit or loss in subsequent

periods:

Gains (losses) on cash flow hedges, before tax

Cash flow hedges, before tax

Losses on marketable securities, before tax

Gains on pensions, before tax

Other comprehensive income (loss), before tax

Income tax relating to components of other comprehensive income (loss)

Comprehensive (loss) income

$ (41,455)

$ 190,380

$ 40,394

(14)

(14)

17,052

25,207

(50,067)

(3,888)

(9,774)

26,136

13,164

15,433

(23,931)

—

(796)

212

813

—

1,325

(854)

886

(91,287)

112,046

460

1,034

1,025

(90,827)

113,080

$ (40,430)

$ 99,553

$ 153,474

Foreign currency translation adjustments, before tax

(12,156)

(108,045)

135,945

The accompanying notes are an integral part of these consolidated financial statements.

QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

239,707 $ 2,812
239,707 $ 2,812
239,707 $ 2,812
239,707 $ 2,812
239,707 $ 2,812
239,707 $ 2,812
239,707 $ 2,812
239,707 $ 2,812

239,707 $ 2,812

$ 1,794,665 $ 1,263,464
$ 1,794,665 $ 1,263,464
$ 1,794,665 $ 1,263,464
$ 1,794,665 $ 1,263,464
$ 1,794,665 $ 1,263,464
$ 1,794,665 $ 1,263,464
$ 1,794,665 $ 1,263,464
$ 1,794,665 $ 1,263,464

$ 1,794,665 $ 1,263,464

$ (333,839)
$ (333,839)
$ (333,839)
$ (333,839)
$ (333,839)
$ (333,839)
$ (333,839)
$ (333,839)

$ (333,839)

(5,147) $ (120,006) $ 2,607,096
(5,147) $ (120,006) $ 2,607,096
(5,147) $ (120,006) $ 2,607,096
(5,147) $ (120,006) $ 2,607,096
(5,147) $ (120,006) $ 2,607,096
(5,147) $ (120,006) $ 2,607,096
(5,147) $ (120,006) $ 2,607,096
(5,147) $ (120,006) $ 2,607,096

(5,147) $ (120,006) $ 2,607,096

Capital repayment
Capital repayment
Capital repayment
Capital repayment
Capital repayment
Capital repayment
Capital repayment
Capital repayment

Capital repayment

(18)
(18)
(18)
(18)
(18)
(18)
(18)
(18)

(8,878)
(8,878)
(8,878)
(8,878)
(18)
(8,878)
(8,878)
(8,878)
(8,878)

(110)
(110)
(110)
(110)
(8,878)
(110)
(110)
(110)
(110)

Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants

Issuance of warrants

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

(110)

(244,319)
(244,319)
(244,319)
(244,319)
(244,319)
(244,319)
(244,319)
(244,319)

(244,319)

—

45,307
45,307
45,307
45,307
45,307
45,307
45,307
45,307

45,307

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—

—

—

—
—
—
—
—
—
—
—

191
191
191
191
—
191
191
191
191

191

— (244,429)
— (244,429)
— (244,429)
— (244,429)
— (244,429)
— (244,429)
— (244,429)
— (244,429)

— (244,429)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

45,307
45,307
45,307
45,307
—
45,307
45,307
45,307
45,307

45,307

Net income
Net income
Net income
Net income
Net income
Net income
Net income
Net income

Net income

Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
pension
pension
pension
pension
pension
pension
pension
pension
pension

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—

—
—
—
—
—
—
—
—

40,394
40,394
40,394
40,394
—
40,394
40,394
40,394
40,394

40,394

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

40,394
40,394
40,394
40,394
—
40,394
40,394
40,394
40,394

40,394

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

620
620
620
620
620
620
620
620

—
—
—
—
620
—
—
—
—

—

—
—
—
—
—
—
—
—

—

620
620
620
620
620
620
620
620

620

Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts

Unrealized loss, net on
hedging contracts

(14)
(14)
(14)
(14)
(14)
(14)
(14)
(14)

(14)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

(42,489)
(42,489)
(42,489)
(42,489)
(42,489)
(42,489)
(42,489)
(42,489)

—
—
—
—
(42,489)
—
—
—
—

—

—
—
—
—
—
—
—
—

(42,489)
(42,489)
(42,489)
(42,489)
—
(42,489)
(42,489)
(42,489)
(42,489)

(42,489)

(14)
(14)
Realized loss, net on hedging
Realized loss, net on hedging
(14)
(14)
Realized loss, net on hedging
Realized loss, net on hedging
Realized loss, net on hedging
(14)
(14)
(14)
(14)
Realized loss, net on hedging
Realized loss, net on hedging
Realized loss, net on hedging
Realized loss, net on hedging
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts

(14)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

19,602
19,602
19,602
19,602
19,602
19,602
19,602
19,602

—
—
—
—
19,602
—
—
—
—

—

—
—
—
—
—
—
—
—

19,602
19,602
19,602
19,602
—
19,602
19,602
19,602
19,602

19,602

Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
marketable securities
marketable securities
marketable securities
marketable securities
marketable securities
marketable securities
marketable securities
marketable securities

Unrealized loss, net on
marketable securities

(7)
(7)
(7)
(7)
(7)
(7)
(7)
(7)

(7)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

(786)
(786)
(786)
(786)
(786)
(786)
(786)
(786)

—
—
—
—
(786)
—
—
—
—

—

—
—
—
—
—
—
—
—

—

(786)
(786)
(786)
(786)
(786)
(786)
(786)
(786)

(786)

Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net

Translation adjustment, net

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares

(18)
(18)
(18)
(18)
(18)
(18)
(18)
(18)
Purchase of treasury shares

(18)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan

Issuance of common shares in
(22)
(22)
(22)
(22)
(22)
(22)
(22)
(22)
connection with stock plan

(22)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—

—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

—

—
—
—
—
—
—
—
—

(55,913)
(55,913)
(55,913)
(55,913)
—
(55,913)
(55,913)
(55,913)
(55,913)

(55,913)

136,133
136,133
136,133
136,133
136,133
136,133
136,133
136,133

—
—
—
—
136,133
—
—
—
—

—

—
—
—
—
—
—
—
—

136,133
136,133
136,133
136,133
—
136,133
136,133
136,133
136,133

136,133

— (1,909)
— (1,909)
— (1,909)
— (1,909)
— (1,909)
— (1,909)
— (1,909)
— (1,909)

— (1,909)

(60,970)
(60,970)
(60,970)
(60,970)
(60,970)
(60,970)
(60,970)
(60,970)

(60,970)

(60,970)
(60,970)
(60,970)
(60,970)
(60,970)
(60,970)
(60,970)
(60,970)

(60,970)

— 2,593
— 2,593
— 2,593
— 2,593
— 2,593
— 2,593
— 2,593
— 2,593

— 2,593

61,989
61,989
61,989
61,989
61,989
61,989
61,989
61,989

61,989

6,076
6,076
6,076
6,076
6,076
6,076
6,076
6,076

6,076

Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation

(22)
(22)
(22)
(22)
Share-based compensation
(22)
(22)
(22)
(22)

(22)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

34,442
34,442
34,442
34,442
34,442
34,442
34,442
34,442

34,442

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

34,442
34,442
34,442
34,442
—
34,442
34,442
34,442
34,442

34,442

230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702

230,829 $ 2,702

$ 1,630,095 $ 1,247,945
$ 1,630,095 $ 1,247,945
$ 1,630,095 $ 1,247,945
$ 1,630,095 $ 1,247,945
$ 1,630,095 $ 1,247,945
$ 1,630,095 $ 1,247,945
$ 1,630,095 $ 1,247,945
$ 1,630,095 $ 1,247,945

$ 1,630,095 $ 1,247,945

$ (220,759)
$ (220,759)
$ (220,759)
$ (220,759)
$ (220,759)
$ (220,759)
$ (220,759)
$ (220,759)

$ (220,759)

(4,272) $ (118,987) $ 2,540,996
(4,272) $ (118,987) $ 2,540,996
(4,272) $ (118,987) $ 2,540,996
(4,272) $ (118,987) $ 2,540,996
(4,272) $ (118,987) $ 2,540,996
(4,272) $ (118,987) $ 2,540,996
(4,272) $ (118,987) $ 2,540,996
(4,272) $ (118,987) $ 2,540,996

(4,272) $ (118,987) $ 2,540,996

ASU 2016-01 impact of
ASU 2016-01 impact of
ASU 2016-01 impact of
ASU 2016-01 impact of
ASU 2016-01 impact of
ASU 2016-01 impact of
ASU 2016-01 impact of
ASU 2016-01 impact of
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy

ASU 2016-01 impact of
change in accounting policy

ASU 2016-16 impact of
ASU 2016-16 impact of
ASU 2016-16 impact of
ASU 2016-16 impact of
ASU 2016-16 impact of
ASU 2016-16 impact of
ASU 2016-16 impact of
ASU 2016-16 impact of
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy

ASU 2016-16 impact of
change in accounting policy

ASC 606 impact of change in
ASC 606 impact of change in
ASC 606 impact of change in
ASC 606 impact of change in
ASC 606 impact of change in
ASC 606 impact of change in
ASC 606 impact of change in
ASC 606 impact of change in
ASC 606 impact of change in
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

(942)
(942)
(942)
(942)
(942)
(942)
(942)
(942)

(942)

942
942
942
942
942
942
942
942

—
—
—
—
942
—
—
—
—

—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

(16,096)
(16,096)
(16,096)
(16,096)
—
(16,096)
(16,096)
(16,096)
(16,096)

(16,096)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

(16,096)
(16,096)
(16,096)
(16,096)
—
(16,096)
(16,096)
(16,096)
(16,096)

(16,096)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

(1,306)
(1,306)
(1,306)
(1,306)
—
(1,306)
(1,306)
(1,306)
(1,306)

(1,306)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

(1,306)
(1,306)
(1,306)
(1,306)
—
(1,306)
(1,306)
(1,306)
(1,306)

(1,306)

Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants

Issuance of warrants

(18)
(18)
(18)
(18)
(18)
(18)
(18)
(18)

(18)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

71,983
71,983
71,983
71,983
71,983
71,983
71,983
71,983

71,983

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

71,983
71,983
71,983
71,983
—
71,983
71,983
71,983
71,983

71,983

Net income
Net income
Net income
Net income
Net income
Net income
Net income
Net income

Net income

Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
pension
pension
pension
pension
pension
pension
pension
pension
pension

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—

—
—
—
—
—
—
—
—

190,380
190,380
190,380
190,380
—
190,380
190,380
190,380
190,380

190,380

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

190,380
190,380
190,380
190,380
—
190,380
190,380
190,380
190,380

190,380

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

754
754
754
754
754
754
754
754

—
—
—
—
754
—
—
—
—

—

—
—
—
—
—
—
—
—

—

754
754
754
754
754
754
754
754

754

Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts

(14)
(14)
(14)
(14)
(14)
(14)
(14)
(14)

(14)
(14)
Realized gain, net on hedging
Realized gain, net on hedging
(14)
(14)
Realized gain, net on hedging
Realized gain, net on hedging
Realized gain, net on hedging
(14)
(14)
(14)
(14)
Realized gain, net on hedging
Realized gain, net on hedging
Realized gain, net on hedging
Realized gain, net on hedging
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts

(14)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

22,365
22,365
22,365
22,365
22,365
22,365
22,365
22,365

—
—
—
—
22,365
—
—
—
—

—

—
—
—
—
—
—
—
—

22,365
22,365
22,365
22,365
—
22,365
22,365
22,365
22,365

22,365

(14)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

(7,331)
(7,331)
(7,331)
(7,331)
(7,331)
(7,331)
(7,331)
(7,331)

—
—
—
—
(7,331)
—
—
—
—

—

—
—
—
—
—
—
—
—

(7,331)
(7,331)
(7,331)
(7,331)
—
(7,331)
(7,331)
(7,331)
(7,331)

(7,331)

Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net

Translation adjustment, net

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares

(18)
(18)
(18)
(18)
Purchase of treasury shares
(18)
(18)
(18)
(18)

(18)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan

(22)
(22)
(22)
(22)
(22)
(22)
(22)
(22)
Issuance of common shares in
connection with stock plan

(22)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—

—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

—

—
—
—
—
—
—
—
—

(40,357)
(40,357)
(40,357)
(40,357)
—
(40,357)
(40,357)
(40,357)
(40,357)

(40,357)

(106,615)
(106,615)
(106,615)
(106,615)
(106,615)
(106,615)
(106,615)
(106,615)

—
—
—
—
(106,615)
—
—
—
—

—

— (106,615)
— (106,615)
— (106,615)
— (106,615)
— (106,615)
— (106,615)
— (106,615)
— (106,615)

— (106,615)

— (2,871)
— (2,871)
— (2,871)
— (2,871)
— (2,871)
— (2,871)
— (2,871)
— (2,871)

— (2,871)

(104,685)
(104,685)
(104,685)
(104,685)
(104,685)
(104,685)
(104,685)
(104,685)

(104,685)

(104,685)
(104,685)
(104,685)
(104,685)
(104,685)
(104,685)
(104,685)
(104,685)

(104,685)

— 1,823
— 1,823
— 1,823
— 1,823
— 1,823
— 1,823
— 1,823
— 1,823

— 1,823

44,769
44,769
44,769
44,769
44,769
44,769
44,769
44,769

44,769

4,412
4,412
4,412
4,412
4,412
4,412
4,412
4,412

4,412

Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation

(22)
(22)
(22)
(22)
Share-based compensation
(22)
(22)
(22)
(22)

(22)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

40,113
40,113
40,113
40,113
40,113
40,113
40,113
40,113

40,113

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

40,113
40,113
40,113
40,113
—
40,113
40,113
40,113
40,113

40,113

230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702

230,829 $ 2,702

$ 1,742,191 $ 1,379,624
$ 1,742,191 $ 1,379,624
$ 1,742,191 $ 1,379,624
$ 1,742,191 $ 1,379,624
$ 1,742,191 $ 1,379,624
$ 1,742,191 $ 1,379,624
$ 1,742,191 $ 1,379,624
$ 1,742,191 $ 1,379,624

$ 1,742,191 $ 1,379,624

$ (310,644)
$ (310,644)
$ (310,644)
$ (310,644)
$ (310,644)
$ (310,644)
$ (310,644)
$ (310,644)

$ (310,644)

(5,320) $ (178,903) $ 2,634,970
(5,320) $ (178,903) $ 2,634,970
(5,320) $ (178,903) $ 2,634,970
(5,320) $ (178,903) $ 2,634,970
(5,320) $ (178,903) $ 2,634,970
(5,320) $ (178,903) $ 2,634,970
(5,320) $ (178,903) $ 2,634,970
(5,320) $ (178,903) $ 2,634,970

(5,320) $ (178,903) $ 2,634,970

ASC 842 impact of change in
ASC 842 impact of change in
ASC 842 impact of change in
ASC 842 impact of change in
ASC 842 impact of change in
ASC 842 impact of change in
ASC 842 impact of change in
ASC 842 impact of change in
ASC 842 impact of change in
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
138
Net loss
Net loss
Net loss
Net loss
Net loss
Net loss
Net loss
Net loss

Net loss

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

(316)
(316)
(316)
(316)
(316)
(316)
(316)
(316)

(316)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

(316)
(316)
(316)
(316)
(316)
(316)
(316)
(316)

(316)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

(41,455)
(41,455)
(41,455)
(41,455)
—
(41,455)
(41,455)
(41,455)
(41,455)

(41,455)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

(41,455)
(41,455)
(41,455)
(41,455)
—
(41,455)
(41,455)
(41,455)
(41,455)

(41,455)

Conversion of warrants
Conversion of warrants
Conversion of warrants
Conversion of warrants
Conversion of warrants
Conversion of warrants
Conversion of warrants
Conversion of warrants

Conversion of warrants

(18)
(18)
(18)
(18)
(18)
(18)
(18)
(18)

(18)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

(31,067)
(31,067)
(31,067)
(31,067)
—
(31,067)
(31,067)
(31,067)
(31,067)

(31,067)

(37,698)
(37,698)
(37,698)
(37,698)
(37,698)
(37,698)
(37,698)
(37,698)

(37,698)

— 2,056
— 2,056
— 2,056
— 2,056
— 2,056
— 2,056
— 2,056
— 2,056

— 2,056

68,761
68,761
68,761
68,761
68,761
68,761
68,761
68,761

68,761

(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)

(4)

Unrealized loss, net on

Unrealized loss, net on

Unrealized loss, net on

Unrealized loss, net on

Unrealized loss, net on

Unrealized loss, net on

Unrealized loss, net on

Unrealized loss, net on

Unrealized loss, net on

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

(437)

(437)

(437)

(437)

(437)

(437)

(437)

(437)

(437)

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

(437)

(437)

(437)

(437)

(437)

(437)

(437)

(437)

(437)

Unrealized gain, net on

Unrealized gain, net on

Unrealized gain, net on

Unrealized gain, net on

Unrealized gain, net on

Unrealized gain, net on

Unrealized gain, net on

Unrealized gain, net on

Unrealized gain, net on

(14)

(14)

(14)

(14)

(14)

(14)

(14)

(14)

(14)

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

17,052

17,052

17,052

17,052

17,052

17,052

17,052

17,052

17,052

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

17,052

17,052

17,052

17,052

17,052

17,052

17,052

17,052

—

17,052

pension

pension

pension

pension

pension

pension

pension

pension

pension

hedging contracts

hedging contracts

hedging contracts

hedging contracts

hedging contracts

hedging contracts

hedging contracts

hedging contracts

hedging contracts

(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018NoteYears ended December 31,201920182017Net (loss) incomeReclassification adjustments on cash flow hedges, before taxTotal other comprehensive income (loss), after tax(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018239,707 $ 2,812

$ 1,794,665 $ 1,263,464

$ (333,839)

(5,147) $ (120,006) $ 2,607,096

Capital repayment

(18)

(8,878)

(110)

(244,319)

191

— (244,429)

(42,489)

—

(42,489)

136,133

—

136,133

— (1,909)

(60,970)

(60,970)

(55,913)

— 2,593

61,989

6,076

Share-based compensation

(22)

34,442

—

—

—

34,442

230,829 $ 2,702

$ 1,630,095 $ 1,247,945

$ (220,759)

(4,272) $ (118,987) $ 2,540,996

—

(942)

942

—

—

—

(16,096)

Issuance of warrants

Net income

Unrealized gain, net on

pension

Unrealized loss, net on

(14)

hedging contracts

Realized loss, net on hedging

(14)

contracts

Unrealized loss, net on

marketable securities

(7)

Translation adjustment, net

Purchase of treasury shares

(18)

Issuance of common shares in

(22)

connection with stock plan

ASU 2016-01 impact of

change in accounting policy

ASU 2016-16 impact of

change in accounting policy

ASC 606 impact of change in

accounting policy

Issuance of warrants

(18)

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

45,307

40,394

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

(16,096)

—

(1,306)

71,983

—

—

—

—

620

19,602

(786)

—

—

—

—

754

22,365

(7,331)

(106,615)

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

45,307

40,394

620

19,602

(786)

(1,306)

71,983

190,380

754

22,365

(7,331)

— (106,615)

— (2,871)

(104,685)

(104,685)

Unrealized gain, net on
pension

Unrealized gain, net on
hedging contracts

(14)

Realized gain, net on hedging
contracts

(14)

Translation adjustment, net

Purchase of treasury shares

(18)

Issuance of common shares in
connection with stock plan

(22)

Share-based compensation

(22)

—

—

—

—

—

—

—

—

—

—

—

—

—

—

190,380

—

—

—

—

—

40,113

—

—

—

—

40,113

(40,357)

— 1,823

44,769

4,412

Consolidated Financial Statements

—

—

—

—

—

—

—

—

—

Net income

F I N A N C I A L   R E S U LT S

230,829 $ 2,702
239,707 $ 2,812
239,707 $ 2,812
239,707 $ 2,812
239,707 $ 2,812
239,707 $ 2,812
239,707 $ 2,812
239,707 $ 2,812
239,707 $ 2,812

239,707 $ 2,812

$ 1,742,191 $ 1,379,624
$ 1,794,665 $ 1,263,464
$ 1,794,665 $ 1,263,464
$ 1,794,665 $ 1,263,464
$ 1,794,665 $ 1,263,464
$ 1,794,665 $ 1,263,464
$ 1,794,665 $ 1,263,464
$ 1,794,665 $ 1,263,464
$ 1,794,665 $ 1,263,464

$ 1,794,665 $ 1,263,464

$ (310,644)
$ (333,839)
$ (333,839)
$ (333,839)
$ (333,839)
$ (333,839)
$ (333,839)
$ (333,839)
$ (333,839)

$ (333,839)

(5,320) $ (178,903) $ 2,634,970
(5,147) $ (120,006) $ 2,607,096
(5,147) $ (120,006) $ 2,607,096
(5,147) $ (120,006) $ 2,607,096
(5,147) $ (120,006) $ 2,607,096
(5,147) $ (120,006) $ 2,607,096
(5,147) $ (120,006) $ 2,607,096
(5,147) $ (120,006) $ 2,607,096
(5,147) $ (120,006) $ 2,607,096

(5,147) $ (120,006) $ 2,607,096

(18)

(18)
(18)
(18)
(18)
(18)
(18)
(18)
(18)

Net income

Capital repayment

Issuance of warrants

ASC 842 impact of change in
Capital repayment
Capital repayment
Capital repayment
Capital repayment
Capital repayment
Capital repayment
Capital repayment
Capital repayment
accounting policy
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Net loss
Net income
Net income
Net income
Net income
Net income
Net income
Net income
Net income
Conversion of warrants
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized loss, net on
pension
pension
pension
pension
pension
pension
pension
pension
pension
pension
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized gain, net on
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
(14)
(14)
Realized loss, net on hedging
Realized loss, net on hedging
(14)
Realized loss, net on hedging
Realized loss, net on hedging
(14)
(14)
(14)
(14)
Realized loss, net on hedging
Realized loss, net on hedging
Realized loss, net on hedging
Realized loss, net on hedging
(14)
Realized loss, net on hedging
(14)
Realized gain, net on hedging
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Translation adjustment, net
marketable securities
marketable securities
marketable securities
marketable securities
marketable securities
marketable securities
marketable securities
marketable securities

Unrealized loss, net on
marketable securities

Unrealized loss, net on
hedging contracts

(14)
(14)
(14)
(14)
(14)
(14)
(14)
(14)
(14)

(7)
(7)
(7)
(7)
(7)
(7)
(7)
(7)

—
(8,878)
(8,878)
(18)
(8,878)
(8,878)
(8,878)
(8,878)
(8,878)
(8,878)

—
(110)
(110)
(8,878)
(110)
(110)
(110)
(110)
(110)
(110)

—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—

(14)
—
—
—
—
—
—
—
—
—

—
—
—
(14)
—
—
—
—
—
—

(7)

—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—
—

Purchase of treasury shares
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net

(18)
Translation adjustment, net

—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—
—

(22)
(18)
(18)
(18)
(18)
(18)
(18)
(18)
Purchase of treasury shares
(18)

Issuance of common shares in
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
connection with stock plan
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Tax withholding related to
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
vesting of stock awards
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation

(22)
(22)
(22)
(22)
(22)
(22)
(22)
Issuance of common shares in
(22)
(22)
connection with stock plan

(22)
(22)
(22)
Share-based compensation
(22)
(22)
(22)
(22)
(22)
(22)

—
—
—
—
(18)
—
—
—
—
—

—
—
—
—
—
—
—
—
—
—

—
—
—
(22)
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—
—

(110)

—
(244,319)
(244,319)
(244,319)
(244,319)
(244,319)
(244,319)
(244,319)
(244,319)

(244,319)

(316)
—
—
—
—
—
—
—
—

—

45,307
45,307
45,307
45,307
45,307
45,307
45,307
45,307
—
—
—
—
—
—
—
—
—
—
(31,067)
—
—
—
—
—
—
—
—
—
—

45,307

—
—
—
—
—
—
—
—
(41,455)
40,394
40,394
40,394
—
40,394
40,394
40,394
40,394
40,394
(37,698)
—
—
—
—
—
—
—
—
—

—

40,394

—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—

—

—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—
—

— (121,698)
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—
—
—
—
—
—
—
—
—

—
191
191
—
191
191
191
191
191
191

191

—
(316)
— (244,429)
— (244,429)
— (244,429)
— (244,429)
— (244,429)
— (244,429)
— (244,429)
— (244,429)

— (244,429)

—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
— 2,056
—
—
620
—
620
620
—
—
620
—
620
—
620
620
620
—
620
(437)
—

—

—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
68,761
—
—
—
—
—
—
—
—
—
—

45,307
45,307
45,307
—
45,307
45,307
45,307
45,307
45,307
(41,455)
40,394
40,394
—
40,394
40,394
40,394
40,394
40,394
40,394
(4)
620
620
620
620
620
620
620
620
(437)

—

45,307

40,394

620

(42,489)
(42,489)
(42,489)
(42,489)
(42,489)
(42,489)
(42,489)
(42,489)
17,052

—
—
—
(42,489)
—
—
—
—
—
—

19,602
19,602
19,602
19,602
19,602
19,602
19,602
19,602
(3,888)

—
—
—
19,602
—
—
—
—
—
—

(786)
(786)
(786)
(786)
(786)
(786)
(786)
(786)
(11,702)

—
—
—
(786)
—
—
—
—
—
—

—

—

—

—
—
—
—
—
—
—
—
—

(42,489)
(42,489)
(42,489)
—
(42,489)
(42,489)
(42,489)
(42,489)
(42,489)
17,052

(42,489)

—
—
—
—
—
—
—
—
—

19,602
19,602
19,602
—
19,602
19,602
19,602
19,602
19,602
(3,888)

19,602

—
—
—
—
—
—
—
—
—

—

(786)
(786)
(786)
(786)
(786)
(786)
(786)
(786)
(11,702)

(786)

136,133
136,133
136,133
136,133
136,133
136,133
136,133
136,133

— (1,987)
—
—
—
136,133
—
—
—
—
—

(74,450)
—
—
—
—
—
—
—
—
—

(74,450)
136,133
136,133
136,133
—
136,133
136,133
136,133
136,133
136,133

136,133

— 3,622
— (1,909)
— (1,909)
— (1,909)
— (1,909)
— (1,909)
— (1,909)
— (1,909)
— (1,909)

— (1,909)

123,773
(60,970)
(60,970)
(60,970)
(60,970)
(60,970)
(60,970)
(60,970)
(60,970)

(60,970)

2,075
(60,970)
(60,970)
(60,970)
(60,970)
(60,970)
(60,970)
(60,970)
(60,970)

(60,970)

—
—
—
—
—
—
—
—
—

(55,913)
(55,913)
—
(55,913)
(55,913)
(55,913)
(55,913)
(55,913)
(55,913)
—

(55,913)

— 2,593
— 2,593
— 2,593
— 2,593
— 2,593
— 2,593
— 2,593
— 2,593
— (1,448)

— 2,593

61,989
61,989
61,989
61,989
61,989
61,989
61,989
61,989
(51,147)

61,989

6,076
6,076
6,076
6,076
6,076
6,076
6,076
6,076
(51,147)

6,076

(22)
—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—
—
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702

—

34,442

34,442
34,442
34,442
34,442
34,442
34,442
34,442
34,442
65,893

—
—
—
—
—
—
—
—
—
$ 1,630,095 $ 1,247,945
$ 1,630,095 $ 1,247,945
$ 1,630,095 $ 1,247,945
$ 1,630,095 $ 1,247,945
$ 1,630,095 $ 1,247,945
$ 1,630,095 $ 1,247,945
$ 1,630,095 $ 1,247,945
$ 1,630,095 $ 1,247,945
$ 1,777,017 $ 1,178,457

$ 1,630,095 $ 1,247,945

—

230,829 $ 2,702

—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
$ (220,759)
$ (220,759)
$ (220,759)
$ (220,759)
$ (220,759)
$ (220,759)
$ (220,759)
$ (220,759)
$ (220,759)
$ (309,619)

34,442
34,442
—
—
34,442
—
—
34,442
34,442
—
—
34,442
—
34,442
—
34,442
—
65,893
—
(4,272) $ (118,987) $ 2,540,996
(4,272) $ (118,987) $ 2,540,996
(4,272) $ (118,987) $ 2,540,996
(4,272) $ (118,987) $ 2,540,996
(4,272) $ (118,987) $ 2,540,996
(4,272) $ (118,987) $ 2,540,996
(4,272) $ (118,987) $ 2,540,996
(4,272) $ (118,987) $ 2,540,996
(3,077) $ (111,966) $ 2,536,591

(4,272) $ (118,987) $ 2,540,996

34,442

—

ASU 2016-01 impact of
ASU 2016-01 impact of
ASU 2016-01 impact of
ASU 2016-01 impact of
ASU 2016-01 impact of
ASU 2016-01 impact of
ASU 2016-01 impact of
ASU 2016-01 impact of
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy

ASU 2016-01 impact of
change in accounting policy

The accompanying notes are an integral part of these consolidated financial statements.

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

(942)
(942)
(942)
(942)
(942)
(942)
(942)
(942)

(942)

942
942
942
942
942
942
942
942

—
—
—
942
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

ASU 2016-16 impact of
ASU 2016-16 impact of
ASU 2016-16 impact of
ASU 2016-16 impact of
ASU 2016-16 impact of
ASU 2016-16 impact of
ASU 2016-16 impact of
ASU 2016-16 impact of
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy
change in accounting policy

ASU 2016-16 impact of
change in accounting policy

ASC 606 impact of change in
ASC 606 impact of change in
ASC 606 impact of change in
ASC 606 impact of change in
ASC 606 impact of change in
ASC 606 impact of change in
ASC 606 impact of change in
ASC 606 impact of change in
ASC 606 impact of change in
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

(16,096)
(16,096)
(16,096)
—
(16,096)
(16,096)
(16,096)
(16,096)
(16,096)

(16,096)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

(16,096)
(16,096)
(16,096)
—
(16,096)
(16,096)
(16,096)
(16,096)
(16,096)

(16,096)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

(1,306)
(1,306)
(1,306)
—
(1,306)
(1,306)
(1,306)
(1,306)
(1,306)

(1,306)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

(1,306)
(1,306)
(1,306)
—
(1,306)
(1,306)
(1,306)
(1,306)
(1,306)

(1,306)

Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants
Issuance of warrants

Issuance of warrants

(18)
(18)
(18)
(18)
(18)
(18)
(18)
(18)

(18)
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

71,983
71,983
71,983
71,983
71,983
71,983
71,983
71,983

71,983

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

71,983
71,983
71,983
—
71,983
71,983
71,983
71,983
71,983

71,983

Net income
Net income
Net income
Net income
Net income
Net income
Net income
Net income

Net income

Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
pension
pension
pension
pension
pension
pension
pension
pension
pension

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—

—
—
—
—
—
—
—
—

190,380
190,380
190,380
—
190,380
190,380
190,380
190,380
190,380

190,380

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

190,380
190,380
190,380
—
190,380
190,380
190,380
190,380
190,380

190,380

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

754
754
754
754
754
754
754
754

—
—
—
754
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

754
754
754
754
754
754
754
754

754

Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
Unrealized gain, net on
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts
hedging contracts

(14)
(14)
(14)
(14)
(14)
(14)
(14)
(14)

(14)
(14)
Realized gain, net on hedging
(14)
Realized gain, net on hedging
Realized gain, net on hedging
Realized gain, net on hedging
Realized gain, net on hedging
Realized gain, net on hedging
Realized gain, net on hedging
Realized gain, net on hedging
(14)
(14)
(14)
(14)
(14)
Realized gain, net on hedging
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts

—
—
—
(14)
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

22,365
22,365
22,365
22,365
22,365
22,365
22,365
22,365

—
—
—
22,365
—
—
—
—
—

—

—
—
—
—
—
—
—
—

22,365
22,365
22,365
—
22,365
22,365
22,365
22,365
22,365

22,365

—
—
—
(14)
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

(7,331)
(7,331)
(7,331)
(7,331)
(7,331)
(7,331)
(7,331)
(7,331)

—
—
—
(7,331)
—
—
—
—
—

—

—
—
—
—
—
—
—
—

(7,331)
(7,331)
(7,331)
—
(7,331)
(7,331)
(7,331)
(7,331)
(7,331)

(7,331)

Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net
Translation adjustment, net

Translation adjustment, net

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares
Purchase of treasury shares

(18)
(18)
(18)
Purchase of treasury shares
(18)
(18)
(18)
(18)
(18)

(18)
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
Issuance of common shares in
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan
connection with stock plan

(22)
(22)
(22)
Issuance of common shares in
(22)
(22)
(22)
(22)
(22)
connection with stock plan

(22)
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—

—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

—

—
—
—
—
—
—
—
—

(40,357)
(40,357)
(40,357)
—
(40,357)
(40,357)
(40,357)
(40,357)
(40,357)

(40,357)

(106,615)
(106,615)
(106,615)
(106,615)
(106,615)
(106,615)
(106,615)
(106,615)

—
—
—
(106,615)
—
—
—
—
—

—

— (106,615)
— (106,615)
— (106,615)
— (106,615)
— (106,615)
— (106,615)
— (106,615)
— (106,615)

— (106,615)

— (2,871)
— (2,871)
— (2,871)
— (2,871)
— (2,871)
— (2,871)
— (2,871)
— (2,871)

— (2,871)

(104,685)
(104,685)
(104,685)
(104,685)
(104,685)
(104,685)
(104,685)
(104,685)

(104,685)

(104,685)
(104,685)
(104,685)
(104,685)
(104,685)
(104,685)
(104,685)
(104,685)

(104,685)

— 1,823
— 1,823
— 1,823
— 1,823
— 1,823
— 1,823
— 1,823
— 1,823

— 1,823

44,769
44,769
44,769
44,769
44,769
44,769
44,769
44,769

44,769

4,412
4,412
4,412
4,412
4,412
4,412
4,412
4,412

4,412

Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation

(22)
(22)
(22)
Share-based compensation
(22)
(22)
(22)
(22)
(22)

(22)
—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

40,113
40,113
40,113
40,113
40,113
40,113
40,113
40,113

40,113

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

40,113
40,113
40,113
—
40,113
40,113
40,113
40,113
40,113

40,113

230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702
230,829 $ 2,702

230,829 $ 2,702

$ 1,742,191 $ 1,379,624
$ 1,742,191 $ 1,379,624
$ 1,742,191 $ 1,379,624
$ 1,742,191 $ 1,379,624
$ 1,742,191 $ 1,379,624
$ 1,742,191 $ 1,379,624
$ 1,742,191 $ 1,379,624
$ 1,742,191 $ 1,379,624

$ 1,742,191 $ 1,379,624

$ (310,644)
$ (310,644)
$ (310,644)
$ (310,644)
$ (310,644)
$ (310,644)
$ (310,644)
$ (310,644)

$ (310,644)

(5,320) $ (178,903) $ 2,634,970
(5,320) $ (178,903) $ 2,634,970
(5,320) $ (178,903) $ 2,634,970
(5,320) $ (178,903) $ 2,634,970
(5,320) $ (178,903) $ 2,634,970
(5,320) $ (178,903) $ 2,634,970
(5,320) $ (178,903) $ 2,634,970
(5,320) $ (178,903) $ 2,634,970

(5,320) $ (178,903) $ 2,634,970

ASC 842 impact of change in
ASC 842 impact of change in
ASC 842 impact of change in
ASC 842 impact of change in
ASC 842 impact of change in
ASC 842 impact of change in
ASC 842 impact of change in
ASC 842 impact of change in
ASC 842 impact of change in
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy
accounting policy

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

(316)
(316)
(316)
(316)
(316)
(316)
(316)
(316)

(316)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

(316)
(316)
(316)
(316)
(316)
(316)
(316)
(316)

(316)

Net loss
Net loss
Net loss
Net loss
Net loss
Net loss
Net loss
Net loss

Net loss

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

(41,455)
(41,455)
(41,455)
—
(41,455)
(41,455)
(41,455)
(41,455)
(41,455)

(41,455)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

(41,455)
(41,455)
(41,455)
—
(41,455)
(41,455)
(41,455)
(41,455)
(41,455)

(41,455)

Conversion of warrants
Conversion of warrants
Conversion of warrants
Conversion of warrants
Conversion of warrants
Conversion of warrants
Conversion of warrants
Conversion of warrants

Conversion of warrants

(18)
(18)
(18)
(18)
(18)
(18)
(18)
(18)

—
—
—
(18)
—
—
—
—
—

—
—
—
—
—
—
—
—
—

(31,067)
(31,067)
(31,067)
—
(31,067)
(31,067)
(31,067)
(31,067)
(31,067)

(31,067)

(37,698)
(37,698)
(37,698)
(37,698)
(37,698)
(37,698)
(37,698)
(37,698)

(37,698)

— 2,056
— 2,056
— 2,056
— 2,056
— 2,056
— 2,056
— 2,056
— 2,056

— 2,056

68,761
68,761
68,761
68,761
68,761
68,761
68,761
68,761

68,761

(4)
(4)
(4)
(4)
(4)
(4)
(4)
(4)

(4)

Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
Unrealized loss, net on
pension
pension
pension
pension
pension
pension
pension
pension
pension

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

—
—
—
—
—
—
—
—

—

(437)
(437)
(437)
(437)
(437)
(437)
(437)
(437)

—
—
—
(437)
—
—
—
—
—

—

—
—
—
—
—
—
—
—

139
(437)
(437)
(437)
(437)
(437)
(437)
(437)
(437)

—

(437)

Unrealized gain, net on

Unrealized gain, net on

Unrealized gain, net on

Unrealized gain, net on

Unrealized gain, net on

Unrealized gain, net on

Unrealized gain, net on

Unrealized gain, net on

Unrealized gain, net on

(14)

(14)

(14)

(14)

(14)

(14)

(14)

(14)

(14)

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

17,052

17,052

17,052

17,052

17,052

17,052

17,052

17,052

17,052

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

17,052

17,052

17,052

17,052

17,052

17,052

17,052

17,052

—

17,052

hedging contracts

hedging contracts

hedging contracts

hedging contracts

hedging contracts

hedging contracts

hedging contracts

hedging contracts

hedging contracts

QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

Balance at December 31,2019(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018(in thousands)NoteCommon SharesAdditionalPaid-In CapitalRetainedEarningsAccumulated OtherComprehensive Income(Loss)Treasury SharesTotal EquitySharesAmountSharesAmountBalance at December 31,2016Balance at December 31,2017Balance at December 31,2018Realized gain, net on hedging

(14)

contracts

Translation adjustment, net

Purchase of treasury shares

(18)

Issuance of common shares in

(22)

connection with stock plan

Tax withholding related to

(22)

vesting of stock awards

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

— (121,698)

— 3,622

123,773

2,075

—

—

(3,888)

—

(3,888)

(11,702)

—

(11,702)

— (1,987)

(74,450)

(74,450)

— (1,448)

(51,147)

(51,147)

Share-based compensation

(22)

65,893

—

—

—

65,893

230,829 $ 2,702

$ 1,777,017 $ 1,178,457

$ (309,619)

(3,077) $ (111,966) $ 2,536,591

The accompanying notes are an integral part of these consolidated financial statements.

QIAGEN N.V. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS

Adjustments to reconcile net (loss) income to net cash provided by operating activities, net of effects

Adjustments to reconcile net (loss) income to net cash provided by operating activities, net of effects of.active
Adjustments to reconcile net (loss) income to net cash provided by operating activities, net of effects
Adjustments to reconcile net (loss) income to net cash provided by operating activities, net of effects
Adjustments to reconcile net (loss) income to net cash provided by operating activities, net of effects
businesses acquired:
of.active businesses acquired:
of.active businesses acquired:
of.active businesses acquired:

of.active businesses acquired:

Other items, net including fair value changes in derivatives

Other items, net including fair value changes in derivatives

Other items, net including fair value changes in derivatives
Other items, net including fair value changes in derivatives

Other items, net including fair value changes in derivatives

Cash flows from operating activities:

Cash flows from operating activities:
Cash flows from operating activities:

Cash flows from operating activities:

Net (loss) income

Net (loss) income
Net (loss) income

Net (loss) income

Depreciation and amortization

Non-cash impairments

Amortization of debt discount and issuance costs

Share-based compensation expense

Deferred income tax (benefit) expense

Loss (gain) on marketable securities

Reversals of contingent consideration

Net changes in operating assets and liabilities:

Accounts receivable

Inventories

Other long-term assets

Accounts payable

Prepaid expenses and other current assets

Accrued and other current liabilities

Income taxes

Other long-term liabilities

Cash flows from operating activities:

Net (loss) income

Proceeds from divestiture

Cash received (paid) for collateral asset

Other investing activities

Cash flows from financing activities:

Cash flows from investing activities:

Purchases of property, plant and equipment

Proceeds from sale of equipment

Purchases of intangible assets

Purchases of investments, net

Cash paid for acquisitions, net of cash acquired

Purchases of short-term investments

Proceeds from redemptions of short-term investments

Depreciation and amortization

Depreciation and amortization
Depreciation and amortization

Depreciation and amortization

Non-cash impairments

Non-cash impairments
Non-cash impairments

Non-cash impairments

Amortization of debt discount and issuance costs

Amortization of debt discount and issuance costs
Amortization of debt discount and issuance costs

Amortization of debt discount and issuance costs

Share-based compensation expense

Share-based compensation expense
Share-based compensation expense

Share-based compensation expense

Deferred income tax (benefit) expense

Deferred income tax (benefit) expense
Deferred income tax (benefit) expense

Deferred income tax (benefit) expense

Loss (gain) on marketable securities

Loss (gain) on marketable securities
Loss (gain) on marketable securities

Loss (gain) on marketable securities

Reversals of contingent consideration

Reversals of contingent consideration
Reversals of contingent consideration

Reversals of contingent consideration

Net changes in operating assets and liabilities:

Net changes in operating assets and liabilities:
Net changes in operating assets and liabilities:

Net changes in operating assets and liabilities:

Accounts receivable

Accounts receivable
Accounts receivable

Accounts receivable

Inventories

Inventories
Inventories

Inventories

Prepaid expenses and other current assets

Prepaid expenses and other current assets
Prepaid expenses and other current assets

Prepaid expenses and other current assets

Other long-term assets

Other long-term assets
Other long-term assets

Other long-term assets

Accounts payable

Accounts payable
Accounts payable

Accounts payable

Accrued and other current liabilities

Accrued and other current liabilities
Accrued and other current liabilities

Accrued and other current liabilities

Income taxes

Income taxes
Income taxes

Income taxes

Other long-term liabilities

Other long-term liabilities
Other long-term liabilities

Other long-term liabilities

Cash flows from investing activities:

Cash flows from investing activities:
Cash flows from investing activities:

Cash flows from investing activities:

Purchases of property, plant and equipment

Purchases of property, plant and equipment
Purchases of property, plant and equipment

Purchases of property, plant and equipment

Proceeds from sale of equipment

Proceeds from sale of equipment
Proceeds from sale of equipment

Proceeds from sale of equipment

Purchases of intangible assets

Purchases of intangible assets
Purchases of intangible assets

Purchases of intangible assets

Purchases of investments, net

Purchases of investments, net
Purchases of investments, net

Purchases of investments, net

Cash paid for acquisitions, net of cash acquired

Cash paid for acquisitions, net of cash acquired
Cash paid for acquisitions, net of cash acquired

Cash paid for acquisitions, net of cash acquired

Purchases of short-term investments

Purchases of short-term investments
Purchases of short-term investments

Purchases of short-term investments

Proceeds from redemptions of short-term investments

Proceeds from redemptions of short-term investments
Proceeds from redemptions of short-term investments

Proceeds from redemptions of short-term investments

Proceeds from divestiture

Proceeds from divestiture
Proceeds from divestiture

Proceeds from divestiture

Cash received (paid) for collateral asset

Cash received (paid) for collateral asset
Cash received (paid) for collateral asset

Cash received (paid) for collateral asset

Other investing activities

Other investing activities
Other investing activities

Other investing activities

Cash flows from financing activities:

Cash flows from financing activities:
Cash flows from financing activities:

Cash flows from financing activities:

Proceeds from long-term debt, net of issuance costs

Proceeds from long-term debt, net of issuance costs

Proceeds from long-term debt, net of issuance costs
Proceeds from long-term debt, net of issuance costs

Proceeds from long-term debt, net of issuance costs

Proceeds from issuance of cash convertible notes, net of issuance costs

Proceeds from issuance of cash convertible notes, net of issuance costs

Proceeds from issuance of cash convertible notes, net of issuance costs
Proceeds from issuance of cash convertible notes, net of issuance costs

Proceeds from issuance of cash convertible notes, net of issuance costs

140

Purchase of call option related to cash convertible notes

Purchase of call option related to cash convertible notes

Purchase of call option related to cash convertible notes
Purchase of call option related to cash convertible notes

Purchase of call option related to cash convertible notes

$ (41,455)
$ (41,455)
$ (41,455)
$ (41,455)

$ (41,455)

$ 190,380

$ 190,380
$ 190,380

$ 190,380

$ 40,394
$ 190,380

$ 40,394
$ 40,394

$ 40,394

231,458
231,458
231,458
231,458

231,458

206,436

206,436
206,436

206,436

216,448

216,448
206,436
216,448
216,448

$ 40,394

216,448

(6)

(6)
(6)
(6)

(6)

144,830
144,830
144,830
144,830

144,830

17,020

17,020
17,020

17,020

5,137

17,020
5,137
5,137
5,137

5,137

40,763
40,763
40,763
40,763
40,763

35,537

35,537
35,537

35,537

65,893
65,893
65,893
65,893
65,893

40,113

40,113
40,113

40,113

24,773

24,773
24,773

24,773
35,537

34,442

34,442
34,442

40,113
34,442

(55,362)
(55,362)
(55,362)
(55,362)

(55,362)

(23,272)

(23,272)
(23,272)

(23,272)

60,176

60,176
60,176
(23,272)

60,176

24,773

34,442

60,176

(22)

(22)
(22)
(22)

(22)

(17)

(17)
(17)
(17)

(17)

2,867
2,867
2,867

2,867

2,867

(2,725)

(2,725)
(2,725)

(2,725)

(15)

(15)
(15)
(15)

(15)

(10,433)
(10,433)
(10,433)
(10,433)

(10,433)

—

—
—

—

1,055

(2,725)
1,055
1,055
1,055

1,055

(3,269)

(3,269)
(3,269)

(3,269)

—

(3,269)

(3,394)
(3,394)
(3,394)

(3,394)
(3,394)

(8,834)

(8,834)
(8,834)

(8,834)

(4,521)

(4,521)
(4,521)

(8,834)
(4,521)

(39,578)
(39,578)
(39,578)
(39,578)

(39,578)

(41,813)

(41,813)
(41,813)

(41,813)

(34,165)

(34,165)
(41,813)
(34,165)
(34,165)

(30,028)
(30,028)
(30,028)
(30,028)

(30,028)

(36,918)

(36,918)
(36,918)

(36,918)

(21,633)

(36,918)
(21,633)
(21,633)
(21,633)

18,626
18,626
18,626
18,626
18,626

(9,942)

(9,942)
(9,942)

(9,942)

(5,245)

(5,245)
(5,245)

(9,942)
(5,245)

(1,406)
(1,406)
(1,406)

(1,406)
(1,406)

(30,312)

(30,312)
(30,312)

(30,312)

(16,786)

(16,786)
(30,312)
(16,786)
(16,786)

(4)

(4)
(4)
(4)

(4)

(4)

(4)
(4)
(4)

(4)

(8)

(8)
(8)
(8)

(8)

9,252
9,252
9,252

9,252

9,252

6,993

6,993
6,993

6,993

4,321

4,321
4,321

4,321

6,993

19,913
19,913
19,913
19,913
19,913

(13,317)

(13,317)
(13,317)

(13,317)

2,828
(13,317)

2,828
2,828

2,828

(6,782)
(6,782)
(6,782)

(6,782)
(6,782)

14,239

14,239
14,239

14,239

(41,266)

(41,266)
(41,266)

(41,266)

14,239

(14,321)
(14,321)
(14,321)
(14,321)

(14,321)

15,911

15,911
15,911

15,911

24,090

24,090
24,090

15,911
24,090

330,843
330,843
330,843
330,843

330,843

359,496

359,496
359,496

359,496

286,779

359,496
286,779
286,779
286,779

(117,950)
(117,950)
(117,950)
(117,950)

(117,950)

(109,773)

(109,773)
(109,773)

(109,773)

(90,081)
(109,773)

(90,081)
(90,081)

(90,081)

(4,521)

(34,165)

(21,633)

(5,245)

(16,786)

4,321

2,828

(41,266)

24,090

286,779

(90,081)

—

—
—

—

—

—

—
—

—

42

42
42

42

—

42

(156,934)
(156,934)
(156,934)
(156,934)

(156,934)

(40,990)

(40,990)
(40,990)

(40,990)

(34,324)

(34,324)
(40,990)
(34,324)
(34,324)

(5,170)
(5,170)
(5,170)

(5,170)
(5,170)

(9,398)

(9,398)
(9,398)

(9,398)

(4,777)

(4,777)
(4,777)

(4,777)
(9,398)

(68,058)
(68,058)
(68,058)
(68,058)

(68,058)

(172,832)

(172,832)
(172,832)

(172,832)

(50,549)
(172,832)

(50,549)
(50,549)

(50,549)

(293,959)
(293,959)
(293,959)
(293,959)

(293,959)

(568,002)

(568,002)
(568,002)

(568,002)

(450,564)

(450,564)
(450,564)
(568,002)

(450,564)

396,098
396,098
396,098
396,098

396,098

691,765

691,765
691,765

691,765

189,006

691,765
189,006
189,006
189,006

1,000
1,000
1,000

1,000

1,000

16,394

16,394
16,394

16,394

—
16,394

—
—

—

22,685
22,685
22,685
22,685
22,685

(3,461)

(3,461)
(3,461)

(3,461)

(20,707)

(20,707)
(20,707)

(20,707)

(3,461)

10

10
10

10

(15,059)
10

(15,059)
(15,059)

(15,059)

(2,310)

(15,059)
(2,310)
(2,310)

(2,310)

(222,278)
(222,278)
(222,278)
(222,278)

(222,278)

(211,356)

(211,356)
(211,356)

(211,356)

(464,264)

(211,356)
(464,264)
(464,264)

(464,264)

(34,324)

(4,777)

(50,549)

(450,564)

189,006

—

(20,707)

(2,310)

(464,264)

—

—
—

—

—

—
—

—

—

—
—

—

—

— 329,875

— 329,875
— 329,875

— 329,875

— 329,875

494,879
—

494,879
494,879

494,879

394,391

494,879
394,391
394,391
394,391

(97,277)
—

(97,277)
(97,277)

(97,277)

(73,646)

(97,277)
(73,646)
(73,646)
(73,646)

394,391

(73,646)

(13)

(13)
(13)
(13)

(13)

(17)

(17)
(17)
(17)

(17)

(5)

(5)
(5)
(5)

(5)

(7)

(7)
(7)
(7)

(7)

(7)

(7)
(7)
(7)

(7)

(5)

(5)
(5)
(5)

(5)

(14)

(14)
(14)
(14)

(14)

(16)

(16)
(16)
(16)

(16)

(16)

(16)
(16)
(16)

(16)

(16)

(16)
(16)
(16)

(16)

Proceeds from issuance of warrants, net of issuance costs

Proceeds from issuance of warrants, net of issuance costs

Proceeds from issuance of warrants, net of issuance costs

Proceeds from issuance of warrants, net of issuance costs

Proceeds from issuance of warrants, net of issuance costs

(18)

(18)

(18)

(18)

(18)

—

—

—

—

—

72,406

72,406

72,406

72,406

45,396

45,396

45,396

45,396

72,406

45,396

Capital repayment

Capital repayment

Capital repayment

Capital repayment

Capital repayment

(18)

(18)

(18)

(18)

(18)

—

—

—

—

—

— (243,945)

— (243,945)

— (243,945)

— (243,945)

— (243,945)

Proceeds from exercise of call option related to cash convertible notes

Proceeds from exercise of call option related to cash convertible notes

Proceeds from exercise of call option related to cash convertible notes

Proceeds from exercise of call option related to cash convertible notes

Proceeds from exercise of call option related to cash convertible notes

(16)

(16)

(16)

(16)

(16)

134,737

134,737

134,737

134,737

134,737

—

—

—

—

—

—

—

—

—

—

(in thousands)NoteYears ended December 31,201920182017Net cash provided by operating activitiesNet cash used in investing activitiesBalance at December 31,2019(in thousands)NoteYears ended December 31,201920182017Net cash provided by operating activitiesNet cash used in investing activities(in thousands)NoteYears ended December 31,201920182017Net cash provided by operating activitiesNet cash used in investing activities(in thousands)NoteYears ended December 31,201920182017Net cash provided by operating activitiesNet cash used in investing activities(in thousands)NoteYears ended December 31,201920182017Net cash provided by operating activitiesNet cash used in investing activitiesOther items, net including fair value changes in derivatives

(3,394)

(8,834)

(4,521)

Adjustments to reconcile net (loss) income to net cash provided by operating activities, net of effects of.active

Cash flows from operating activities:

Net (loss) income

businesses acquired:

Depreciation and amortization

Non-cash impairments

Amortization of debt discount and issuance costs

Share-based compensation expense

Deferred income tax (benefit) expense

Loss (gain) on marketable securities

Reversals of contingent consideration

Net changes in operating assets and liabilities:

Accounts receivable

Inventories

Other long-term assets

Accounts payable

Prepaid expenses and other current assets

Accrued and other current liabilities

Income taxes

Other long-term liabilities

Cash flows from investing activities:

Purchases of property, plant and equipment

Proceeds from sale of equipment

F I N A N C I A L   R E S U LT S

Consolidated Financial Statements

Purchases of intangible assets

Purchases of investments, net

Cash paid for acquisitions, net of cash acquired

Purchases of short-term investments

Proceeds from redemptions of short-term investments

Proceeds from divestiture

Cash received (paid) for collateral asset

Other investing activities

Cash flows from operating activities:

Cash flows from operating activities:

Cash flows from operating activities:
Cash flows from operating activities:
Cash flows from operating activities:

Net (loss) income

Net (loss) income
Net (loss) income
Net (loss) income
Cash flows from financing activities:

Net (loss) income

Adjustments to reconcile net (loss) income to net cash provided by operating activities, net of effects

Adjustments to reconcile net (loss) income to net cash provided by operating activities, net of effects of.active
Adjustments to reconcile net (loss) income to net cash provided by operating activities, net of effects
Adjustments to reconcile net (loss) income to net cash provided by operating activities, net of effects
Adjustments to reconcile net (loss) income to net cash provided by operating activities, net of effects
Proceeds from long-term debt, net of issuance costs
businesses acquired:
of.active businesses acquired:
of.active businesses acquired:
of.active businesses acquired:
Proceeds from issuance of cash convertible notes, net of issuance costs

of.active businesses acquired:

$ (41,455)

$ 190,380

$ 40,394

231,458

206,436

216,448

(6)

144,830

17,020

5,137

40,763

35,537

24,773

(22)

65,893

40,113

34,442

(17)

(55,362)

(23,272)

60,176

2,867

(2,725)

1,055

(15)

(10,433)

—

(3,269)

(4)

(4)

(8)

(13)

(17)

(39,578)

(41,813)

(34,165)

(30,028)

(36,918)

(21,633)

18,626

(9,942)

(5,245)

(1,406)

(30,312)

(16,786)

9,252

6,993

4,321

19,913

(13,317)

2,828

(6,782)

14,239

(41,266)

(14,321)

15,911

24,090

330,843

359,496

286,779

(117,950)

(109,773)

(90,081)

—

—

42

(156,934)

(40,990)

(34,324)

(5,170)

(9,398)

(4,777)

(5)

(68,058)

(172,832)

(50,549)

(7)

(293,959)

(568,002)

(450,564)

(7)

(5)

396,098

691,765

189,006

1,000

16,394

—

(14)

22,685

(3,461)

(20,707)

10

(15,059)

(2,310)

(222,278)

(211,356)

(464,264)

$ (41,455)
$ (41,455)
$ (41,455)
$ (41,455)
$ (41,455)

$ 190,380

$ 190,380
$ 190,380
$ 190,380

$ 40,394
$ 190,380

$ 40,394
$ 40,394
$ 40,394

Depreciation and amortization

Non-cash impairments

Depreciation and amortization

Depreciation and amortization
Depreciation and amortization
Depreciation and amortization

Purchase of call option related to cash convertible notes

Non-cash impairments

Non-cash impairments
Non-cash impairments
Non-cash impairments

Amortization of debt discount and issuance costs

Proceeds from issuance of warrants, net of issuance costs
Amortization of debt discount and issuance costs
Amortization of debt discount and issuance costs
Amortization of debt discount and issuance costs
Amortization of debt discount and issuance costs

Share-based compensation expense

Share-based compensation expense

Share-based compensation expense
Share-based compensation expense
Share-based compensation expense

Capital repayment

Proceeds from exercise of call option related to cash convertible notes

Deferred income tax (benefit) expense

Loss (gain) on marketable securities

Reversals of contingent consideration

Deferred income tax (benefit) expense

Deferred income tax (benefit) expense
Deferred income tax (benefit) expense
Deferred income tax (benefit) expense
Payment of intrinsic value of cash convertible notes
Loss (gain) on marketable securities
Loss (gain) on marketable securities
Loss (gain) on marketable securities

Loss (gain) on marketable securities

Repayment of long-term debt

Reversals of contingent consideration

Reversals of contingent consideration
Reversals of contingent consideration
Reversals of contingent consideration

Principal payments on capital leases

Other items, net including fair value changes in derivatives

Other items, net including fair value changes in derivatives

Other items, net including fair value changes in derivatives
Other items, net including fair value changes in derivatives
Other items, net including fair value changes in derivatives

Net changes in operating assets and liabilities:

Proceeds from issuance of common shares

Net changes in operating assets and liabilities:
Net changes in operating assets and liabilities:
Net changes in operating assets and liabilities:

Net changes in operating assets and liabilities:
Tax withholding related to vesting of stock awards

Accounts receivable
Purchase of treasury shares

Accounts receivable
Accounts receivable
Accounts receivable

Inventories
Other financing activities

Inventories
Inventories
Inventories

Prepaid expenses and other current assets

Prepaid expenses and other current assets

Prepaid expenses and other current assets
Prepaid expenses and other current assets
Prepaid expenses and other current assets

Other long-term assets

Other long-term assets
Other long-term assets
Other long-term assets

Accounts payable

Accounts payable
Accounts payable
Accounts payable

Accounts receivable

Inventories

Other long-term assets

Accounts payable

Accrued and other current liabilities

Income taxes

Other long-term liabilities

Cash flows from investing activities:

Purchases of property, plant and equipment

Proceeds from sale of equipment

Purchases of intangible assets

Purchases of investments, net

Net (decrease) increase in cash, cash equivalents and restricted cash

Accrued and other current liabilities

Accrued and other current liabilities
Accrued and other current liabilities
Accrued and other current liabilities

Cash and cash equivalents, beginning of period

Income taxes

Income taxes
Income taxes
Income taxes

Other long-term liabilities

Other long-term liabilities
Other long-term liabilities
Other long-term liabilities

Supplemental cash flow disclosures:

Cash paid for interest
Cash flows from investing activities:
Cash flows from investing activities:
Cash flows from investing activities:

Cash flows from investing activities:

Cash paid for income taxes
Purchases of property, plant and equipment

Purchases of property, plant and equipment
Purchases of property, plant and equipment
Purchases of property, plant and equipment

Supplemental disclosure of non-cash investing activities:

Proceeds from sale of equipment

Proceeds from sale of equipment
Proceeds from sale of equipment
Proceeds from sale of equipment

Equipment purchased through capital lease
Purchases of intangible assets

Purchases of intangible assets
Purchases of intangible assets
Purchases of intangible assets

The accompanying notes are an integral part of these consolidated financial statements.

Purchases of investments, net
Purchases of investments, net
Purchases of investments, net

Purchases of investments, net

Cash paid for acquisitions, net of cash acquired

Cash paid for acquisitions, net of cash acquired

Cash paid for acquisitions, net of cash acquired
Cash paid for acquisitions, net of cash acquired
Cash paid for acquisitions, net of cash acquired

Purchases of short-term investments

Purchases of short-term investments

Purchases of short-term investments
Purchases of short-term investments
Purchases of short-term investments

Proceeds from redemptions of short-term investments

Proceeds from redemptions of short-term investments

Proceeds from redemptions of short-term investments
Proceeds from redemptions of short-term investments
Proceeds from redemptions of short-term investments

Proceeds from divestiture

Proceeds from divestiture

Proceeds from divestiture
Proceeds from divestiture
Proceeds from divestiture

Cash received (paid) for collateral asset

Cash received (paid) for collateral asset

Cash received (paid) for collateral asset
Cash received (paid) for collateral asset
Cash received (paid) for collateral asset

(5)

(5)
(5)
(5)
(5)

(7)

(7)
(7)
(7)
(7)

(7)

(7)
(7)
(7)
(7)

(5)

(5)
(5)
(5)
(5)

(14)

(14)
(14)
(14)
(14)

$ 29,721

$ 25,902

$ 20,252

$ 41,474
(117,950)
(117,950)
(117,950)
(117,950)
(117,950)

$ 29,317
(109,773)
(109,773)
(109,773)
(109,773)

$ 40,499
(90,081)
(109,773)

(90,081)
(90,081)
(90,081)

—

—
—
—

—

—

—
—
—

42

42
42
42

—

42

$ —
(156,934)
(156,934)
(156,934)
(156,934)
(156,934)

$ —
(40,990)
(40,990)
(40,990)
(40,990)

$ 88
(34,324)
(40,990)
(34,324)
(34,324)
(34,324)

(5,170)
(5,170)
(5,170)
(5,170)
(5,170)

(9,398)

(9,398)
(9,398)
(9,398)

(4,777)

(9,398)
(4,777)
(4,777)
(4,777)

(4,777)

(68,058)
(68,058)
(68,058)
(68,058)
(68,058)

(172,832)

(172,832)
(172,832)
(172,832)

(50,549)
(172,832)

(50,549)
(50,549)
(50,549)

(293,959)
(293,959)
(293,959)
(293,959)
(293,959)

(568,002)

(568,002)
(568,002)
(568,002)

(450,564)

(568,002)
(450,564)
(450,564)
(450,564)

396,098
396,098
396,098
396,098
396,098

691,765

691,765
691,765
691,765

189,006

691,765
189,006
189,006
189,006

1,000
1,000
1,000
1,000

1,000

16,394

16,394
16,394
16,394

—
16,394

—
—
—

—

22,685
22,685
22,685
22,685
22,685

(3,461)

(3,461)
(3,461)
(3,461)

(20,707)

(20,707)
(20,707)
(20,707)

(3,461)

Other investing activities

Other investing activities

Other investing activities
Other investing activities
Other investing activities

10
10
10
10

(15,059)
10

(15,059)
(15,059)
(15,059)

(2,310)

(15,059)
(2,310)
(2,310)
(2,310)

(2,310)

(222,278)
(222,278)
(222,278)
(222,278)
(222,278)

(211,356)

(211,356)
(211,356)
(211,356)

(464,264)

(464,264)
(464,264)
(464,264)
(211,356)

Cash flows from financing activities:

Cash flows from financing activities:

Cash flows from financing activities:
Cash flows from financing activities:
Cash flows from financing activities:

Proceeds from long-term debt, net of issuance costs

Proceeds from long-term debt, net of issuance costs

Proceeds from long-term debt, net of issuance costs
Proceeds from long-term debt, net of issuance costs
Proceeds from long-term debt, net of issuance costs

(16)

(16)
(16)
(16)
(16)

—

—
—
—

—

— 329,875

— 329,875
— 329,875
— 329,875

— 329,875

Proceeds from issuance of cash convertible notes, net of issuance costs

Proceeds from issuance of cash convertible notes, net of issuance costs

Proceeds from issuance of cash convertible notes, net of issuance costs
Proceeds from issuance of cash convertible notes, net of issuance costs
Proceeds from issuance of cash convertible notes, net of issuance costs

Purchase of call option related to cash convertible notes

Purchase of call option related to cash convertible notes

Purchase of call option related to cash convertible notes
Purchase of call option related to cash convertible notes
Purchase of call option related to cash convertible notes

Proceeds from issuance of warrants, net of issuance costs

Proceeds from issuance of warrants, net of issuance costs

Proceeds from issuance of warrants, net of issuance costs
Proceeds from issuance of warrants, net of issuance costs
Proceeds from issuance of warrants, net of issuance costs

(16)

(16)
(16)
(16)
(16)

(16)

(16)
(16)
(16)
(16)

(18)

(18)
(18)
(18)
(18)

—

—
—
—

—

—
—
—

—

—
—
—

494,879
—

494,879
494,879
494,879

394,391

494,879
394,391
394,391
394,391

(97,277)
—

(97,277)
(97,277)
(97,277)

(73,646)

(97,277)
(73,646)
(73,646)
(73,646)

—

72,406

72,406
72,406
72,406

45,396

72,406
45,396
45,396
45,396

45,396

Capital repayment

Capital repayment

Capital repayment
Capital repayment
Capital repayment

(18)

(18)
(18)
(18)
(18)

—

—
—
—

—

— (243,945)

— (243,945)
— (243,945)
— (243,945)
141

— (243,945)

Proceeds from exercise of call option related to cash convertible notes

Proceeds from exercise of call option related to cash convertible notes

Proceeds from exercise of call option related to cash convertible notes
Proceeds from exercise of call option related to cash convertible notes
Proceeds from exercise of call option related to cash convertible notes

(16)

(16)
(16)
(16)
(16)

134,737
134,737
134,737
134,737
134,737

—

—
—
—

—

—
—
—

—

—

(16)

(16)

(16)
(6)
(6)
(6)
(6)
(18)

(6)

(22)

(17)

(18)
(22)
(22)
(22)
(22)
(16)
(17)
(17)
(17)
(17)
(16)

(16)
(15)
(15)
(15)
(15)

(15)

(4)

(4)

(4)
(4)
(4)
(4)
(18)
(4)
(4)
(4)
(4)

(8)

(8)
(8)
(8)
(8)

(13)

(13)
(13)
(13)
(13)

—

— 329,875

35,537
35,537
35,537

17,020
17,020
17,020

206,436
206,436
206,436

17,020
5,137
5,137
5,137

35,537
24,773
24,773
24,773

206,436
216,448
216,448
216,448

494,879
206,436
(97,277)
17,020
72,406
35,537

—
231,458
231,458
231,458
231,458
231,458
—
144,830
144,830
144,830
144,830
144,830
—
40,763
40,763
40,763
40,763
40,763
—
65,893
65,893
65,893
65,893
65,893
134,737
(55,362)
(55,362)
(55,362)
(55,362)
(55,362)
(133,763)
2,867
2,867
2,867
2,867
(506,400)
(10,433)
(10,433)
(10,433)
(10,433)
(10,433)
—
(3,394)
(3,394)
(3,394)
(3,394)
(3,394)
2,075

394,391
216,448
(73,646)
5,137
45,396
24,773
— (243,945)
34,442
40,113
34,442
34,442
34,442
—
60,176
(23,272)
60,176
60,176
60,176
—
1,055
(2,725)
1,055
1,055
1,055
—
(3,269)
(3,269)
(3,269)
(3,269)
(1,402)
(4,521)
(8,834)
(4,521)
(4,521)
(4,521)
6,075

40,113
40,113
40,113
40,113
—
(23,272)
(23,272)
(23,272)
(23,272)
—
(2,725)
(2,725)
(2,725)
(2,725)
—
—
(1,308)
(8,834)
(8,834)
(8,834)
(8,834)
4,412

2,867

—

—
—
—

(49,998)
(39,578)
(39,578)
(39,578)
(39,578)
(39,578)
(74,450)
(30,028)
(30,028)
(30,028)
(30,028)
(30,028)
(11,281)
18,626
18,626
18,626
18,626
18,626
(639,080)
(1,406)
(1,406)
(1,406)
(1,406)
(1,406)
826
9,252
9,252
9,252
9,252

—
(41,813)
(41,813)
(41,813)
(41,813)
(104,685)
(36,918)
(36,918)
(36,918)
(36,918)
(8,019)
(9,942)
360,408
(30,312)
(30,312)
(30,312)
(30,312)
(7,183)
6,993

9,252

(9,942)
(9,942)
(9,942)

6,993
6,993
6,993

—
(34,165)
(41,813)
(34,165)
(34,165)
(34,165)
(60,970)
(21,633)
(36,918)
(21,633)
(21,633)
(21,633)
(8,587)
(5,245)
387,187
(16,786)
(30,312)
(16,786)
(16,786)
(16,786)
8,832
4,321

(9,942)
(5,245)
(5,245)
(5,245)

6,993

4,321
4,321
4,321

(529,689)
19,913
19,913
19,913
19,913
19,913

501,365
(13,317)

(13,317)
(13,317)
(13,317)

218,534
2,828
(13,317)

2,828
2,828
2,828

(17)

(17)
(17)
(17)
(17)

1,159,079
(6,782)
(6,782)
(6,782)
(6,782)
(6,782)

657,714
14,239

14,239
14,239
14,239

439,180
(41,266)

(41,266)
(41,266)
(41,266)

14,239

$ 629,390 $ 1,159,079 $ 657,714
24,090

(14,321)
(14,321)
(14,321)
(14,321)
(14,321)

15,911
15,911
15,911

15,911

15,911
24,090
24,090
24,090

330,843
330,843
330,843
330,843
330,843

359,496

359,496
359,496
359,496

286,779

359,496
286,779
286,779
286,779

$ 40,394

216,448

5,137

24,773

34,442

60,176

1,055

(3,269)

(4,521)

(34,165)

(21,633)

(5,245)

(16,786)

4,321

2,828

(41,266)

24,090

286,779

(90,081)

(34,324)

(50,549)

(450,564)

189,006

(20,707)

(464,264)

394,391

(73,646)

(in thousands)NoteYears ended December 31,201920182017Net cash provided by operating activitiesNet cash used in investing activities(in thousands)NoteYears ended December 31,201920182017Net cash provided by operating activitiesNet cash used in investing activitiesNet cash (used in) provided by financing activitiesEffect of exchange rate changes on cash, cash equivalents and restricted cashCash, cash equivalents and restricted cash, end of period(in thousands)NoteYears ended December 31,201920182017Net cash provided by operating activitiesNet cash used in investing activities(in thousands)NoteYears ended December 31,201920182017Net cash provided by operating activitiesNet cash used in investing activities(in thousands)NoteYears ended December 31,201920182017Net cash provided by operating activitiesNet cash used in investing activities(in thousands)NoteYears ended December 31,201920182017Net cash provided by operating activitiesNet cash used in investing activitiesFinancial Results
Financial Results

Auditor’s Report
Notes to consolidated financial statements December
31, 2019
Report of independent registered public accounting firm

To the Shareholders and Supervisory Board
1. Corporate Information and Basis of Presentation

QIAGEN N.V.:

QIAGEN N.V. is a public limited liability company ('naamloze vennootschap') under Dutch law with registered office
at Hulsterweg 82, 5912 PL Venlo, The Netherlands. QIAGEN N.V., a Netherlands holding company, and
subsidiaries (we, our or the Company) is the leading global provider of Sample to Insight solutions that are used by
We have audited the accompanying consolidated balance sheets of QIAGEN N.V. and subsidiaries (the
over 500,000 customers worldwide to transform biological samples into valuable molecular insights. Our sample
“Company”) as of December 31, 2019 and 2018, the related consolidated statements of (loss) income,
technologies are used to isolate and process DNA, RNA and proteins - the building blocks of life - from blood, tissue
comprehensive (loss) income, changes in equity, and cash flows for each of the years in the three-year period ended
and other materials. Assay technologies are used to make these biomolecules visible and ready for analysis.
December 31, 2019, and the related notes and financial statement schedule as listed in Item 18 (A) (collectively, the
Bioinformatics software and knowledge bases are used to analyze and interpret complex genomic data to report
consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material
relevant, actionable insights. Automation solutions are used to tie these technologies together in seamless and cost-
respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its
effective workflows. We provide this portfolio to two major customer classes: Molecular Diagnostics (human
operations and its cash flows for each of the years in the three-year period ended December 31, 2019, in conformity
healthcare) and Life Sciences comprised of Academia / Applied Testing (life sciences research, forensics and food
with U.S. generally accepted accounting principles.
safety) and Pharma. With approximately 5,100 employees in over 35 locations worldwide, we market our products
in more than 130 countries.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2019, based on
criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring
Organizations of the Treadway Commission, and our report dated February 28, 2020 expressed an unqualified
The accompanying consolidated financial statements were prepared in accordance with U.S. generally accepted
opinion on the effectiveness of the Company’s internal control over financial reporting.
accounting principles (GAAP) and all amounts are presented in U.S. dollars rounded to the nearest thousand, unless
otherwise indicated. The consolidated financial statements have been prepared on a historical cost basis, except for
derivative financial instruments, contingent consideration and available-for-sale financial instruments that have been
measured at fair value.
As discussed in Note 2 to the consolidated financial statements, the Company has changed its method of accounting
for leases in 2019 due to the adoption of Accounting Standards Codification Topic 842 - Leases. In 2018, the
We undertake acquisitions to complement our own internal product development activities. In 2019, we completed
Company has changed its method of accounting for revenue from contracts with customers due to the adoption of
three immaterial acquisitions, including the January 2019 acquisition of N-of-One, Inc., a privately-held U.S.
Accounting Standards Codification Topic 606 - Revenue from Contracts with Customers.
molecular decision support company and pioneer in clinical interpretation services for complex genomic data located
in Concord, Massachusetts. On April 27, 2018, we acquired all shares in STAT-Dx Life, S.L. (STAT-Dx), a privately-
held company located in Barcelona, Spain and on April 19, 2018, we acquired all remaining shares of a privately
held entity in which we held a minority interest. On January 6, 2017, we acquired OmicSoft Corporation, located in
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to
Cary, North Carolina (U.S.). Accordingly, at their respective acquisition dates, all the assets acquired and liabilities
express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm
assumed were recorded at their respective fair values and our consolidated results of operations include the
registered with the PCAOB and are required to be independent with respect to the Company in accordance with the
operating results from the acquired companies from the acquisition dates.
U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and
the PCAOB.
Certain prior year amounts have been reclassified to conform to the current year presentation. Beginning in 2019 in
the Consolidated Statements of (Loss) Income, the line item "Acquisition-related intangible amortization" in cost of
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and
sales is presented separately. Previously, these amounts were presented together in one line in cost of sales.
perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of
Additionally beginning in 2019, "Restructuring, acquisition, integration and other, net" and "Long-lived asset
material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks
impairments" within operating expenses are presented separately. Previously, these amounts were presented together
of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing
with general and administrative expenses in one line as "General and administrative, restructuring, integration and
procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the
other, net." These reclassifications had no effect on (loss) income from operations.
amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting

142

Corporate InformationBasis of PresentationOpinion on the Consolidated Financial StatementsChange in Accounting PrincipleBasis for OpinionF I N A N C I A L   R E S U LT S Notes to consolidated financial statements

2. Effects of New Accounting Pronouncements

The following new Financial Accounting Standards Board (FASB) Accounting Standards Updates (ASU) were
adopted in 2019, 2018 and 2017:

The FASB issued guidance codified in Accounting Standards Codification (ASC) Topic 842, Leases (Topic 842),
which supersedes the lease requirements in ASC Topic 840 and aims to increase transparency and comparability
among organizations and requires disclosure of key information about leasing arrangements. The main principle of
ASC 842 requires lessees to recognize the assets and liabilities that arise from nearly all leases on the consolidated
balance sheet. Lessor accounting remains mainly consistent with the former guidance, with the majority of changes
allowing for better alignment with the new lessee model and ASC Topic 606. We adopted these standards as per
the effective date of January 1, 2019, using the modified retrospective approach and did not restate comparative
periods. Under this approach, the cumulative effect of initially applying the standard was recognized as an
adjustment to the opening balance of retained earnings on the date of initial application. As a lessee, the
classification of our leases did not change, but we recognized a lease liability and corresponding right-of-use asset
on our consolidated balance sheets for all our operating leases. We have elected the package of practical
expedients which allows us to not reassess (1) whether existing contracts contain leases, (2) the lease classification
for existing leases, and (3) whether existing initial direct costs meet the new definition. We also elected the hindsight
practical expedient which permits entities to use hindsight in determining the lease term when transitioning to ASC
842. Our initial lease liabilities and right-of-use assets totaled $57.7 million and $57.4 million, respectively, as
recorded in our consolidated balance sheet as of January 1, 2019, primarily relating to leased office space. The
difference between the additional lease assets and lease liabilities was recorded as a $0.3 million adjustment to
retained earnings. Further disclosure is found in Note 12 "Leases".

ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities,
makes more financial and nonfinancial hedging strategies eligible for hedge accounting. It also amends the
presentation and disclosure requirements and changes how companies assess effectiveness. It is intended to more
closely align hedge accounting with companies’ risk management strategies, simplify the application of hedge
accounting, and increase transparency as to the scope and results of hedging programs. The new guidance became
effective for public entities beginning on January 1, 2019 by applying a modified retrospective approach to existing
hedging relationships as of the adoption date. Under the modified retrospective approach, entities with cash flow or
net investment hedges will make (1) a cumulative-effect adjustment to accumulated other comprehensive income so
that the adjusted amount represents the cumulative change in the hedging instruments’ fair value since hedge
inception (less any amounts that should have been recognized in earnings under the new accounting model) and (2)
a corresponding adjustment to opening retained earnings as of the most recent period presented on the date of
adoption. We adopted ASU 2017-12 on January 1, 2019 without any cumulative effect.

ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, removes
Step 2 of the goodwill impairment test. A goodwill impairment will now be the amount by which a reporting unit’s
carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. ASU 2017-04 is effective for
public entities for annual periods beginning January 1, 2020 and early adoption is permitted. The new guidance is
required to be applied on a prospective basis. We adopted ASU 2017-04 on January 1, 2019 and applied the new
guidance prospectively as required.

ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework, provides guidance that eliminates, adds
and modifies certain disclosure requirements for fair value measurements. ASU 2018-13 is effective for public entities
for annual periods beginning January 1, 2020. Entities are permitted to early adopt either the entire standard or
only the provisions that eliminate or modify the requirements. We adopted ASU 2018-13 on January 1, 2019 and
applied the entire standard to disclosures as required beginning in 2019.

ASU 2018-15, Intangibles--Goodwill and Other--Internal-Use Software (Subtopic 350-40): Customer's Accounting for
Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, provides guidance on
a customer's accounting for implementation, set-up, and other upfront costs incurred in a cloud computing
arrangement that is hosted by the vendor, i.e. a service contract. Under the new guidance, customers will apply the

143

Adoption of New Accounting Standards in 20192. Effects of New Accounting Pronouncements

The following new Financial Accounting Standards Board (FASB) Accounting Standards Updates (ASU) were

adopted in 2019, 2018 and 2017:

The FASB issued guidance codified in Accounting Standards Codification (ASC) Topic 842, Leases (Topic 842),

which supersedes the lease requirements in ASC Topic 840 and aims to increase transparency and comparability

among organizations and requires disclosure of key information about leasing arrangements. The main principle of

ASC 842 requires lessees to recognize the assets and liabilities that arise from nearly all leases on the consolidated

balance sheet. Lessor accounting remains mainly consistent with the former guidance, with the majority of changes

allowing for better alignment with the new lessee model and ASC Topic 606. We adopted these standards as per

the effective date of January 1, 2019, using the modified retrospective approach and did not restate comparative

periods. Under this approach, the cumulative effect of initially applying the standard was recognized as an

adjustment to the opening balance of retained earnings on the date of initial application. As a lessee, the

classification of our leases did not change, but we recognized a lease liability and corresponding right-of-use asset

on our consolidated balance sheets for all our operating leases. We have elected the package of practical

expedients which allows us to not reassess (1) whether existing contracts contain leases, (2) the lease classification

for existing leases, and (3) whether existing initial direct costs meet the new definition. We also elected the hindsight

practical expedient which permits entities to use hindsight in determining the lease term when transitioning to ASC

842. Our initial lease liabilities and right-of-use assets totaled $57.7 million and $57.4 million, respectively, as

recorded in our consolidated balance sheet as of January 1, 2019, primarily relating to leased office space. The

difference between the additional lease assets and lease liabilities was recorded as a $0.3 million adjustment to

retained earnings. Further disclosure is found in Note 12 "Leases".

ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities,

makes more financial and nonfinancial hedging strategies eligible for hedge accounting. It also amends the

presentation and disclosure requirements and changes how companies assess effectiveness. It is intended to more

closely align hedge accounting with companies’ risk management strategies, simplify the application of hedge

accounting, and increase transparency as to the scope and results of hedging programs. The new guidance became

effective for public entities beginning on January 1, 2019 by applying a modified retrospective approach to existing

hedging relationships as of the adoption date. Under the modified retrospective approach, entities with cash flow or

net investment hedges will make (1) a cumulative-effect adjustment to accumulated other comprehensive income so

that the adjusted amount represents the cumulative change in the hedging instruments’ fair value since hedge

inception (less any amounts that should have been recognized in earnings under the new accounting model) and (2)

a corresponding adjustment to opening retained earnings as of the most recent period presented on the date of

adoption. We adopted ASU 2017-12 on January 1, 2019 without any cumulative effect.

ASU 2017-04, Intangibles—Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment, removes

Step 2 of the goodwill impairment test. A goodwill impairment will now be the amount by which a reporting unit’s

carrying value exceeds its fair value, not to exceed the carrying amount of goodwill. ASU 2017-04 is effective for

public entities for annual periods beginning January 1, 2020 and early adoption is permitted. The new guidance is

required to be applied on a prospective basis. We adopted ASU 2017-04 on January 1, 2019 and applied the new
guidance prospectively as required.

ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework, provides guidance that eliminates, adds
and modifies certain disclosure requirements for fair value measurements. ASU 2018-13 is effective for public entities
for annual periods beginning January 1, 2020. Entities are permitted to early adopt either the entire standard or
only the provisions that eliminate or modify the requirements. We adopted ASU 2018-13 on January 1, 2019 and
applied the entire standard to disclosures as required beginning in 2019.

ASU 2018-15, Intangibles--Goodwill and Other--Internal-Use Software (Subtopic 350-40): Customer's Accounting for
Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract, provides guidance on
a customer's accounting for implementation, set-up, and other upfront costs incurred in a cloud computing
arrangement that is hosted by the vendor, i.e. a service contract. Under the new guidance, customers will apply the
same criteria for capitalizing implementation costs as they would for an arrangement that has a software license.
ASU 2018-15 is effective for public entities for annual periods beginning January 1, 2020, and early adoption is
permitted and should be applied either retrospectively or prospectively to all implementation costs incurred after the
date of adoption. We adopted ASU 2018-15 on January 1, 2019 and applied the guidance to all implementation
costs prospectively.

ASU 2018-17, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest
Entities, amends how a decision maker or service provider determines whether its fee is a variable interest entity (VIE)
when a related party under common control also has an interest in the VIE. We adopted ASU 2018-17 on January
1, 2019, on a prospective basis.

ASU 2014-09, Revenue from Contracts with Customers (Topic 606) and additional related accounting standard
updates to clarify and provide implementation guidance were adopted with a date of initial application of January
1, 2018. The comparative information for 2017 has not been adjusted and continues to be reported under ASC
Topic 605 Revenue Recognition. As a result, we changed our accounting policy for revenue recognition as further
discussed in the Notes below. We applied the Topic 606 using the "modified retrospective method" by recognizing
the effect of initially applying Topic 606 as an $1.3 million decrease to the opening balance of retained earnings at
January 1, 2018, for all contracts not completed at January 1, 2018.

ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets
and Financial Liabilities as well as an additional clarifying accounting standard update became effective for our
financial statements beginning in the first quarter of 2018. This ASU makes targeted improvements to existing U.S.
GAAP for both the recognition and measurement of financial assets and financial liabilities. Changes in accounting
to our equity investments as a result of this standard are further discussed in Notes below. As required, we adopted
using a cumulative-effect adjustment to the balance sheet as of the beginning of 2018 and recorded an adjustment to
decrease opening retained earnings at January 1, 2018 by $0.9 million as required for our equity investments
recorded at fair value.

ASU 2016-05, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments
and ASU 2016-18, Statement of Cash Flows (Topic 320): Restricted Cash, addresses classification issues and
presentation related to the statement of cash flows and was adopted on January 1, 2018 without any impact from
the adoption.

ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory, aims to improve the
accounting for the income tax consequences of intra-entity transfers of assets other than inventory. This standard was
adopted on a modified retrospective basis resulting in a decrease to opening retained earnings of $16.1 million at
January 1, 2018.

ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business, clarifies and provides a
more robust framework to use in determining when a set of assets and activities is a business. We adopted this
update beginning January 1, 2018, without impact.

ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting, clarifies when to
account for a change to the terms and conditions of a share-based payment award as a modification. This guidance
is effective prospectively and was adopted as of January 1, 2018.

144
ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax
Effects from Accumulated Other Comprehensive Income, permits reclassification of stranded tax effects of the U.S.
Tax Cuts and Jobs Act (Tax Act). We adopted this standard as of April 1, 2018 with no impact as we had no

stranded tax effects. This guidance only relates to the effects of the Tax Act. For all other tax law changes that have

occurred or may occur in the future, we reclassify the tax effects to the consolidated statement of income (loss) on an

item-by-item basis when the pre-tax item in accumulated other comprehensive income (loss) is reclassified to income.

Adoption of New Accounting Standards in 2019Adoption of New Accounting Standards in 2018same criteria for capitalizing implementation costs as they would for an arrangement that has a software license.

ASU 2018-15 is effective for public entities for annual periods beginning January 1, 2020, and early adoption is

permitted and should be applied either retrospectively or prospectively to all implementation costs incurred after the

date of adoption. We adopted ASU 2018-15 on January 1, 2019 and applied the guidance to all implementation

costs prospectively.

ASU 2018-17, Consolidation (Topic 810): Targeted Improvements to Related Party Guidance for Variable Interest

Entities, amends how a decision maker or service provider determines whether its fee is a variable interest entity (VIE)

when a related party under common control also has an interest in the VIE. We adopted ASU 2018-17 on January

1, 2019, on a prospective basis.

ASU 2014-09, Revenue from Contracts with Customers (Topic 606) and additional related accounting standard

updates to clarify and provide implementation guidance were adopted with a date of initial application of January

1, 2018. The comparative information for 2017 has not been adjusted and continues to be reported under ASC

Topic 605 Revenue Recognition. As a result, we changed our accounting policy for revenue recognition as further

discussed in the Notes below. We applied the Topic 606 using the "modified retrospective method" by recognizing

the effect of initially applying Topic 606 as an $1.3 million decrease to the opening balance of retained earnings at

January 1, 2018, for all contracts not completed at January 1, 2018.

ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets

and Financial Liabilities as well as an additional clarifying accounting standard update became effective for our

financial statements beginning in the first quarter of 2018. This ASU makes targeted improvements to existing U.S.

GAAP for both the recognition and measurement of financial assets and financial liabilities. Changes in accounting

to our equity investments as a result of this standard are further discussed in Notes below. As required, we adopted

using a cumulative-effect adjustment to the balance sheet as of the beginning of 2018 and recorded an adjustment to

decrease opening retained earnings at January 1, 2018 by $0.9 million as required for our equity investments

recorded at fair value.

ASU 2016-05, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments

and ASU 2016-18, Statement of Cash Flows (Topic 320): Restricted Cash, addresses classification issues and

presentation related to the statement of cash flows and was adopted on January 1, 2018 without any impact from

the adoption.

ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory, aims to improve the
accounting for the income tax consequences of intra-entity transfers of assets other than inventory. This standard was
F I N A N C I A L   R E S U LT S Notes to consolidated financial statements
adopted on a modified retrospective basis resulting in a decrease to opening retained earnings of $16.1 million at
January 1, 2018.

ASU 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business, clarifies and provides a
more robust framework to use in determining when a set of assets and activities is a business. We adopted this
update beginning January 1, 2018, without impact.

ASU 2017-09, Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting, clarifies when to
account for a change to the terms and conditions of a share-based payment award as a modification. This guidance
is effective prospectively and was adopted as of January 1, 2018.

ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax
Effects from Accumulated Other Comprehensive Income, permits reclassification of stranded tax effects of the U.S.
Tax Cuts and Jobs Act (Tax Act). We adopted this standard as of April 1, 2018 with no impact as we had no
stranded tax effects. This guidance only relates to the effects of the Tax Act. For all other tax law changes that have
occurred or may occur in the future, we reclassify the tax effects to the consolidated statement of income (loss) on an
item-by-item basis when the pre-tax item in accumulated other comprehensive income (loss) is reclassified to income.

ASU 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based
Payment Accounting, aligns most of the accounting for share-based payment awards issued to employees and non-
employees. We early adopted this standard as of July 1, 2018, without material impact.

ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory, requires in scope inventory to be
measured at the lower of cost and net realizable value. We adopted this standard without material impact.

ASU 2016-07, Investments - Equity Method and Joint Ventures (Topic 323): Simplifying the Transition to the Equity
Method of Accounting, eliminates the requirement to retroactively adopt the equity method of accounting when an
investment qualifies for use of the equity method as a result of an increase in the level of ownership or degree of
influence. We adopted this standard without impact.

ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment
Accounting, simplifies several aspects of accounting for share-based payment transactions, including income tax
consequences. We adopted this standard on January 1, 2017 on a prospective basis.

The following new FASB Accounting Standards Updates, which are not yet adopted as of December 31, 2019, have
been grouped by their required effective dates:

ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial
Instruments, provides financial statement users with more decision-useful information about the expected credit losses
on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. To
achieve this objective, the amendments in ASU 2016-13 replace the incurred loss impairment methodology in current
GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of
reasonable and supportable information to inform credit loss estimates. The measurement of expected credit losses
under Topic 326 is applicable to financial assets measured at amortized cost, including loan receivables and held-to-
maturity debt securities. It also applies to off-balance sheet credit exposures not accounted for as insurance (loan
commitments, standby letters of credit, financial guarantees, and other similar instruments) and net investments in
leases recognized by a lessor in accordance with Topic 842 on leases. In addition, Topic 326 made changes to the
accounting for available-for-sale debt securities. One such change is to require credit losses to be presented as an
allowance rather than as a write-down on available-for-sale debt securities management does not intend to sell or
believes is more likely than not they will be required to sell.

Topic 326 is effective for us for annual periods beginning on January 1, 2020 and we will adopt using the modified
retrospective approach. Under this approach, the cumulative effect of initially applying the standard is recognized as
adjustment to the opening balance of retained earnings on the date of initial application. We currently expect a
transition adjustment of approximately $14.0 million due primarily to expected credit losses on loans, notes and
accounts receivable.

145

ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic

606, precludes an entity from presenting consideration from a transaction in a collaborative arrangement as revenue

from contracts with customers if the counterparty is not a customer of that transaction. The guidance amends ASC

808 to refer to unit-of-account guidance in ASC 606 and requires it to be used only when assessing whether a

transaction is in the scope of ASC 606. ASU 2018-18 is effective for us for annual periods beginning on January 1,

2020. Entities are required to apply the amendments retrospectively to the date they initially applied ASC 606. We

adopted ASU 2018-18 on January 1, 2020 without any cumulative effect.

ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, removes certain exceptions

for recognizing deferred taxes for investments, performing intraperiod tax allocations and calculating income taxes in

Adoption of New Accounting Standards in 2018Adoption of New Accounting Standards in 2017New Accounting Standards Not Yet AdoptedFirst Quarter of 2020First Quarter of 2021ASU 2018-07, Compensation-Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based

Payment Accounting, aligns most of the accounting for share-based payment awards issued to employees and non-

employees. We early adopted this standard as of July 1, 2018, without material impact.

ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory, requires in scope inventory to be

measured at the lower of cost and net realizable value. We adopted this standard without material impact.

ASU 2016-07, Investments - Equity Method and Joint Ventures (Topic 323): Simplifying the Transition to the Equity

Method of Accounting, eliminates the requirement to retroactively adopt the equity method of accounting when an

investment qualifies for use of the equity method as a result of an increase in the level of ownership or degree of

influence. We adopted this standard without impact.

ASU 2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment

Accounting, simplifies several aspects of accounting for share-based payment transactions, including income tax

consequences. We adopted this standard on January 1, 2017 on a prospective basis.

The following new FASB Accounting Standards Updates, which are not yet adopted as of December 31, 2019, have

been grouped by their required effective dates:

ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial

Instruments, provides financial statement users with more decision-useful information about the expected credit losses

on financial instruments and other commitments to extend credit held by a reporting entity at each reporting date. To

achieve this objective, the amendments in ASU 2016-13 replace the incurred loss impairment methodology in current

GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of
reasonable and supportable information to inform credit loss estimates. The measurement of expected credit losses
under Topic 326 is applicable to financial assets measured at amortized cost, including loan receivables and held-to-
maturity debt securities. It also applies to off-balance sheet credit exposures not accounted for as insurance (loan
commitments, standby letters of credit, financial guarantees, and other similar instruments) and net investments in
leases recognized by a lessor in accordance with Topic 842 on leases. In addition, Topic 326 made changes to the
accounting for available-for-sale debt securities. One such change is to require credit losses to be presented as an
allowance rather than as a write-down on available-for-sale debt securities management does not intend to sell or
believes is more likely than not they will be required to sell.

Topic 326 is effective for us for annual periods beginning on January 1, 2020 and we will adopt using the modified
retrospective approach. Under this approach, the cumulative effect of initially applying the standard is recognized as
adjustment to the opening balance of retained earnings on the date of initial application. We currently expect a
transition adjustment of approximately $14.0 million due primarily to expected credit losses on loans, notes and
accounts receivable.

ASU 2018-18, Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic
606, precludes an entity from presenting consideration from a transaction in a collaborative arrangement as revenue
from contracts with customers if the counterparty is not a customer of that transaction. The guidance amends ASC
808 to refer to unit-of-account guidance in ASC 606 and requires it to be used only when assessing whether a
transaction is in the scope of ASC 606. ASU 2018-18 is effective for us for annual periods beginning on January 1,
2020. Entities are required to apply the amendments retrospectively to the date they initially applied ASC 606. We
adopted ASU 2018-18 on January 1, 2020 without any cumulative effect.

ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes, removes certain exceptions
for recognizing deferred taxes for investments, performing intraperiod tax allocations and calculating income taxes in
interim periods. The ASU also adds guidance to reduce complexity in certain areas, including recognizing deferred
taxes for tax goodwill and allocating income taxes to members of a consolidated group. ASU 2019-12 is effective
for annual periods beginning on January 1, 2021, with earlier adoption permitted. We intend to adopt the ASU on
the effective date of January 1, 2021 and are evaluating the potential impact ASU 2019-12 may have on our
consolidated financial statements.

ASU 2020-01, Investments-Equity Securities (Topic 321), Investments-Equity Method and Joint Ventures (Topic 323),
and Derivatives and Hedging (Topic 815)-Clarifying the Interactions between Topic 321, Topic 323, and Topic 815,
addresses accounting for the transition into and out of the equity method and measuring certain purchased options
and forward contracts to acquire investments. We intend to adopt the ASU on the effective date of January 1, 2021
and are evaluating the potential impact ASU 2020-01 may have on our consolidated financial statements.

3. Summary of Significant Accounting Policies

The consolidated financial statements include the accounts of QIAGEN N.V. and its wholly-owned subsidiaries. All
significant intercompany accounts and transactions have been eliminated. Investments in either common stock or in-
substance common stock of companies where we exercise significant influence over the operations but do not have
control, and where we are not the primary beneficiary, are accounted for using the equity method. All other
investments are accounted for as discussed under "Non-marketable Investments" below. When there is a portion of
equity in an acquired subsidiary not attributable, directly or indirectly, to the Company, we record the fair value of
the noncontrolling interests at the acquisition date and classify the amounts attributable to noncontrolling interests
separately in equity in the consolidated financial statements. Any subsequent changes in the Company's ownership
interest while the Company retains its controlling financial interest in its subsidiary are accounted for as equity
transactions.

The preparation of financial statements in conformity with accounting principles generally accepted in the United
States requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities
and disclosure of contingencies at the date of the financial statements as well as the reported amounts of revenues
and expenses during the reporting period. Actual results could differ from those estimates.

146
We buy materials for products from many suppliers, and are not dependent on any one supplier or group of
suppliers for the business as a whole. However, key components of certain products, including certain

instrumentation components and chemicals, are available only from a single source. If supplies from these vendors

were delayed or interrupted for any reason, we may not be able to obtain these materials timely or in sufficient

quantities in order to produce certain products and sales levels could be negatively affected. Additionally, our

customers include researchers at pharmaceutical and biotechnology companies, academic institutions, and

government and private laboratories. Fluctuations in the research and development budgets of these researchers and

their organizations for applications in which our products are used could have a significant effect on the demand for

our products.

The financial instruments used in managing our foreign currency, equity and interest rate exposures have an element

of risk in that the counterparties may be unable to meet the terms of the agreements. We attempt to minimize this risk

by limiting the counterparties to a diverse group of highly-rated international financial institutions. The carrying values

of our financial instruments incorporate the non-performance risk by using market pricing for credit risk. However, we

have no reason to believe that any counterparties will default on their obligations. In order to minimize our exposure

with any single counterparty, we have entered into master agreements which allow us to manage the exposure with

the respective counterparty on a net basis.

Other financial instruments that potentially subject us to concentrations of credit risk are cash and cash equivalents,

short-term investments, and accounts receivable. We attempt to minimize the risks related to cash and cash

Adoption of New Accounting Standards in 2017New Accounting Standards Not Yet AdoptedFirst Quarter of 2020First Quarter of 2021Principles of ConsolidationUse of EstimatesConcentrations of Riskinterim periods. The ASU also adds guidance to reduce complexity in certain areas, including recognizing deferred

taxes for tax goodwill and allocating income taxes to members of a consolidated group. ASU 2019-12 is effective

for annual periods beginning on January 1, 2021, with earlier adoption permitted. We intend to adopt the ASU on

the effective date of January 1, 2021 and are evaluating the potential impact ASU 2019-12 may have on our

consolidated financial statements.

ASU 2020-01, Investments-Equity Securities (Topic 321), Investments-Equity Method and Joint Ventures (Topic 323),

and Derivatives and Hedging (Topic 815)-Clarifying the Interactions between Topic 321, Topic 323, and Topic 815,

addresses accounting for the transition into and out of the equity method and measuring certain purchased options

and forward contracts to acquire investments. We intend to adopt the ASU on the effective date of January 1, 2021

and are evaluating the potential impact ASU 2020-01 may have on our consolidated financial statements.

3. Summary of Significant Accounting Policies

The consolidated financial statements include the accounts of QIAGEN N.V. and its wholly-owned subsidiaries. All

significant intercompany accounts and transactions have been eliminated. Investments in either common stock or in-

substance common stock of companies where we exercise significant influence over the operations but do not have
control, and where we are not the primary beneficiary, are accounted for using the equity method. All other
F I N A N C I A L   R E S U LT S Notes to consolidated financial statements
investments are accounted for as discussed under "Non-marketable Investments" below. When there is a portion of
equity in an acquired subsidiary not attributable, directly or indirectly, to the Company, we record the fair value of
the noncontrolling interests at the acquisition date and classify the amounts attributable to noncontrolling interests
separately in equity in the consolidated financial statements. Any subsequent changes in the Company's ownership
interest while the Company retains its controlling financial interest in its subsidiary are accounted for as equity
transactions.

The preparation of financial statements in conformity with accounting principles generally accepted in the United
States requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities
and disclosure of contingencies at the date of the financial statements as well as the reported amounts of revenues
and expenses during the reporting period. Actual results could differ from those estimates.

We buy materials for products from many suppliers, and are not dependent on any one supplier or group of
suppliers for the business as a whole. However, key components of certain products, including certain
instrumentation components and chemicals, are available only from a single source. If supplies from these vendors
were delayed or interrupted for any reason, we may not be able to obtain these materials timely or in sufficient
quantities in order to produce certain products and sales levels could be negatively affected. Additionally, our
customers include researchers at pharmaceutical and biotechnology companies, academic institutions, and
government and private laboratories. Fluctuations in the research and development budgets of these researchers and
their organizations for applications in which our products are used could have a significant effect on the demand for
our products.

The financial instruments used in managing our foreign currency, equity and interest rate exposures have an element
of risk in that the counterparties may be unable to meet the terms of the agreements. We attempt to minimize this risk
by limiting the counterparties to a diverse group of highly-rated international financial institutions. The carrying values
of our financial instruments incorporate the non-performance risk by using market pricing for credit risk. However, we
have no reason to believe that any counterparties will default on their obligations. In order to minimize our exposure
with any single counterparty, we have entered into master agreements which allow us to manage the exposure with
the respective counterparty on a net basis.

Other financial instruments that potentially subject us to concentrations of credit risk are cash and cash equivalents,
short-term investments, and accounts receivable. We attempt to minimize the risks related to cash and cash
equivalents and short-term investments by dealing with highly-rated financial institutions and investing in a broad and
diverse range of financial instruments. We have established guidelines related to credit quality and maturities of
investments intended to maintain safety and liquidity. Concentration of credit risk with respect to accounts receivable
is limited due to a large and diverse customer base, which is dispersed over different geographic areas. Allowances
are maintained for potential credit losses and such losses have historically been within expected ranges.

Our reporting currency is the U.S. dollar and the functional currencies of our subsidiaries are generally the local
currency of the respective countries in which they are headquartered. All amounts in the financial statements of
entities whose functional currency is not the U.S. dollar are translated into U.S. dollar equivalents at exchange rates
as follows: (1) assets and liabilities at period-end rates, (2) income statement accounts at average exchange rates for
the period, and (3) components of equity at historical rates. Translation gains or losses are recorded in equity, and
transaction gains and losses are reflected in net income as a component of other expense, net. Realized gains or
losses on the value of derivative contracts entered into to hedge the exchange rate exposure of receivables and
payables are also included in net (loss) income as a component of other expense, net. The net loss on foreign
currency transactions was $5.7 million, $12.3 million, and $3.3 million in 2019, 2018 and 2017, respectively,
and is included in other income (expense), net.

The exchange rates of key currencies were as follows:

Euro (EUR)

Pound Sterling (GBP)

Swiss Franc (CHF)

Australian Dollar (AUD)

Canadian Dollar (CAD)

Japanese Yen (JPY)

Chinese Yuan (CNY)

147

1.1234

1.1450

1.1196

1.1813

1.1292

1.3204

1.2800

1.2768

1.3356

1.2882

1.0350

1.0161

1.0062

1.0228

1.0156

0.7023

0.7059

0.6954

0.7478

0.7666

0.7696

0.7337

0.7535

0.7719

0.7710

0.0092

0.0091

0.0092

0.0091

0.0089

0.1437

0.1454

0.1448

0.1514

0.1480

We determined that we operate as one operating segment in accordance with the Financial Accounting Standards

Board (FASB) Accounting Standards Codification (ASC) Topic 280, Segment Reporting. Our chief operating decision

maker (CODM) makes decisions based on the Company as a whole. In addition, we have a common basis of

organization and types of products and services which derive revenues and consistent product margins. Accordingly,

we operate and make decisions as one reporting unit.

Beginning January 1, 2018, we recognize revenues when control of promised goods or services transfers to our

customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or

services. The majority of our sales revenue continues to be recognized when products are shipped to the customers at

which point control transfers. Prior to January 1, 2018, payments for milestones, generally based on the achievement

of substantive and at-risk performance criteria, were recognized in full at such time as the specified milestone had

been achieved according to the terms of the agreement. See Note 4 "Revenue" for further discussion of accounting

for milestone payments after adoption of ASC 606 Revenue from Contracts with Customers.

Principles of ConsolidationUse of EstimatesConcentrations of RiskForeign Currency TranslationSegment InformationRevenue RecognitionWarranty(US$ equivalent for one)Closing rate atDecember 31,Annual average rate20192018201920182017equivalents and short-term investments by dealing with highly-rated financial institutions and investing in a broad and

equivalents and short-term investments by dealing with highly-rated financial institutions and investing in a broad and

equivalents and short-term investments by dealing with highly-rated financial institutions and investing in a broad and

equivalents and short-term investments by dealing with highly-rated financial institutions and investing in a broad and

equivalents and short-term investments by dealing with highly-rated financial institutions and investing in a broad and

equivalents and short-term investments by dealing with highly-rated financial institutions and investing in a broad and

equivalents and short-term investments by dealing with highly-rated financial institutions and investing in a broad and

equivalents and short-term investments by dealing with highly-rated financial institutions and investing in a broad and

diverse range of financial instruments. We have established guidelines related to credit quality and maturities of

diverse range of financial instruments. We have established guidelines related to credit quality and maturities of

diverse range of financial instruments. We have established guidelines related to credit quality and maturities of

diverse range of financial instruments. We have established guidelines related to credit quality and maturities of

diverse range of financial instruments. We have established guidelines related to credit quality and maturities of

diverse range of financial instruments. We have established guidelines related to credit quality and maturities of

diverse range of financial instruments. We have established guidelines related to credit quality and maturities of

diverse range of financial instruments. We have established guidelines related to credit quality and maturities of

investments intended to maintain safety and liquidity. Concentration of credit risk with respect to accounts receivable

investments intended to maintain safety and liquidity. Concentration of credit risk with respect to accounts receivable

investments intended to maintain safety and liquidity. Concentration of credit risk with respect to accounts receivable

investments intended to maintain safety and liquidity. Concentration of credit risk with respect to accounts receivable

investments intended to maintain safety and liquidity. Concentration of credit risk with respect to accounts receivable

investments intended to maintain safety and liquidity. Concentration of credit risk with respect to accounts receivable

investments intended to maintain safety and liquidity. Concentration of credit risk with respect to accounts receivable

investments intended to maintain safety and liquidity. Concentration of credit risk with respect to accounts receivable

is limited due to a large and diverse customer base, which is dispersed over different geographic areas. Allowances

is limited due to a large and diverse customer base, which is dispersed over different geographic areas. Allowances

is limited due to a large and diverse customer base, which is dispersed over different geographic areas. Allowances

is limited due to a large and diverse customer base, which is dispersed over different geographic areas. Allowances

is limited due to a large and diverse customer base, which is dispersed over different geographic areas. Allowances

is limited due to a large and diverse customer base, which is dispersed over different geographic areas. Allowances

is limited due to a large and diverse customer base, which is dispersed over different geographic areas. Allowances

is limited due to a large and diverse customer base, which is dispersed over different geographic areas. Allowances

are maintained for potential credit losses and such losses have historically been within expected ranges.

are maintained for potential credit losses and such losses have historically been within expected ranges.

are maintained for potential credit losses and such losses have historically been within expected ranges.

are maintained for potential credit losses and such losses have historically been within expected ranges.

are maintained for potential credit losses and such losses have historically been within expected ranges.

are maintained for potential credit losses and such losses have historically been within expected ranges.

are maintained for potential credit losses and such losses have historically been within expected ranges.

are maintained for potential credit losses and such losses have historically been within expected ranges.

Our reporting currency is the U.S. dollar and the functional currencies of our subsidiaries are generally the local

Our reporting currency is the U.S. dollar and the functional currencies of our subsidiaries are generally the local

Our reporting currency is the U.S. dollar and the functional currencies of our subsidiaries are generally the local

Our reporting currency is the U.S. dollar and the functional currencies of our subsidiaries are generally the local

Our reporting currency is the U.S. dollar and the functional currencies of our subsidiaries are generally the local

Our reporting currency is the U.S. dollar and the functional currencies of our subsidiaries are generally the local

Our reporting currency is the U.S. dollar and the functional currencies of our subsidiaries are generally the local

Our reporting currency is the U.S. dollar and the functional currencies of our subsidiaries are generally the local

currency of the respective countries in which they are headquartered. All amounts in the financial statements of

currency of the respective countries in which they are headquartered. All amounts in the financial statements of

currency of the respective countries in which they are headquartered. All amounts in the financial statements of

currency of the respective countries in which they are headquartered. All amounts in the financial statements of

currency of the respective countries in which they are headquartered. All amounts in the financial statements of

currency of the respective countries in which they are headquartered. All amounts in the financial statements of

currency of the respective countries in which they are headquartered. All amounts in the financial statements of

entities whose functional currency is not the U.S. dollar are translated into U.S. dollar equivalents at exchange rates
entities whose functional currency is not the U.S. dollar are translated into U.S. dollar equivalents at exchange rates
as follows: (1) assets and liabilities at period-end rates, (2) income statement accounts at average exchange rates for
as follows: (1) assets and liabilities at period-end rates, (2) income statement accounts at average exchange rates for
the period, and (3) components of equity at historical rates. Translation gains or losses are recorded in equity, and
the period, and (3) components of equity at historical rates. Translation gains or losses are recorded in equity, and
transaction gains and losses are reflected in net income as a component of other expense, net. Realized gains or
transaction gains and losses are reflected in net income as a component of other expense, net. Realized gains or
losses on the value of derivative contracts entered into to hedge the exchange rate exposure of receivables and
losses on the value of derivative contracts entered into to hedge the exchange rate exposure of receivables and
payables are also included in net (loss) income as a component of other expense, net. The net loss on foreign
payables are also included in net (loss) income as a component of other expense, net. The net loss on foreign
currency transactions was $5.7 million, $12.3 million, and $3.3 million in 2019, 2018 and 2017, respectively,
currency transactions was $5.7 million, $12.3 million, and $3.3 million in 2019, 2018 and 2017, respectively,
and is included in other income (expense), net.
and is included in other income (expense), net.

currency of the respective countries in which they are headquartered. All amounts in the financial statements of
entities whose functional currency is not the U.S. dollar are translated into U.S. dollar equivalents at exchange rates
entities whose functional currency is not the U.S. dollar are translated into U.S. dollar equivalents at exchange rates
entities whose functional currency is not the U.S. dollar are translated into U.S. dollar equivalents at exchange rates
entities whose functional currency is not the U.S. dollar are translated into U.S. dollar equivalents at exchange rates
entities whose functional currency is not the U.S. dollar are translated into U.S. dollar equivalents at exchange rates
entities whose functional currency is not the U.S. dollar are translated into U.S. dollar equivalents at exchange rates
as follows: (1) assets and liabilities at period-end rates, (2) income statement accounts at average exchange rates for
as follows: (1) assets and liabilities at period-end rates, (2) income statement accounts at average exchange rates for
as follows: (1) assets and liabilities at period-end rates, (2) income statement accounts at average exchange rates for
as follows: (1) assets and liabilities at period-end rates, (2) income statement accounts at average exchange rates for
as follows: (1) assets and liabilities at period-end rates, (2) income statement accounts at average exchange rates for
as follows: (1) assets and liabilities at period-end rates, (2) income statement accounts at average exchange rates for
the period, and (3) components of equity at historical rates. Translation gains or losses are recorded in equity, and
the period, and (3) components of equity at historical rates. Translation gains or losses are recorded in equity, and
the period, and (3) components of equity at historical rates. Translation gains or losses are recorded in equity, and
the period, and (3) components of equity at historical rates. Translation gains or losses are recorded in equity, and
the period, and (3) components of equity at historical rates. Translation gains or losses are recorded in equity, and
the period, and (3) components of equity at historical rates. Translation gains or losses are recorded in equity, and
transaction gains and losses are reflected in net income as a component of other expense, net. Realized gains or
transaction gains and losses are reflected in net income as a component of other expense, net. Realized gains or
transaction gains and losses are reflected in net income as a component of other expense, net. Realized gains or
transaction gains and losses are reflected in net income as a component of other expense, net. Realized gains or
transaction gains and losses are reflected in net income as a component of other expense, net. Realized gains or
transaction gains and losses are reflected in net income as a component of other expense, net. Realized gains or
losses on the value of derivative contracts entered into to hedge the exchange rate exposure of receivables and
losses on the value of derivative contracts entered into to hedge the exchange rate exposure of receivables and
losses on the value of derivative contracts entered into to hedge the exchange rate exposure of receivables and
losses on the value of derivative contracts entered into to hedge the exchange rate exposure of receivables and
losses on the value of derivative contracts entered into to hedge the exchange rate exposure of receivables and
losses on the value of derivative contracts entered into to hedge the exchange rate exposure of receivables and
payables are also included in net (loss) income as a component of other expense, net. The net loss on foreign
payables are also included in net (loss) income as a component of other expense, net. The net loss on foreign
payables are also included in net (loss) income as a component of other expense, net. The net loss on foreign
payables are also included in net (loss) income as a component of other expense, net. The net loss on foreign
payables are also included in net (loss) income as a component of other expense, net. The net loss on foreign
payables are also included in net (loss) income as a component of other expense, net. The net loss on foreign
currency transactions was $5.7 million, $12.3 million, and $3.3 million in 2019, 2018 and 2017, respectively,
currency transactions was $5.7 million, $12.3 million, and $3.3 million in 2019, 2018 and 2017, respectively,
currency transactions was $5.7 million, $12.3 million, and $3.3 million in 2019, 2018 and 2017, respectively,
currency transactions was $5.7 million, $12.3 million, and $3.3 million in 2019, 2018 and 2017, respectively,
currency transactions was $5.7 million, $12.3 million, and $3.3 million in 2019, 2018 and 2017, respectively,
currency transactions was $5.7 million, $12.3 million, and $3.3 million in 2019, 2018 and 2017, respectively,
and is included in other income (expense), net.
and is included in other income (expense), net.
and is included in other income (expense), net.
and is included in other income (expense), net.
and is included in other income (expense), net.
and is included in other income (expense), net.

The exchange rates of key currencies were as follows:
The exchange rates of key currencies were as follows:

The exchange rates of key currencies were as follows:
The exchange rates of key currencies were as follows:
The exchange rates of key currencies were as follows:

The exchange rates of key currencies were as follows:
The exchange rates of key currencies were as follows:
The exchange rates of key currencies were as follows:

Euro (EUR)

Euro (EUR)

Euro (EUR)
Euro (EUR)
Euro (EUR)

Euro (EUR)
Euro (EUR)
Euro (EUR)

1.1234

1.1234

1.1450

1.1450

1.1234
1.1234
1.1234

1.1196
1.1234
1.1234
1.1196
1.1234

1.1450
1.1450
1.1450

1.1813
1.1450
1.1450
1.1813
1.1450

1.1196
1.1196
1.1196

1.1292
1.1196
1.1196
1.1292
1.1196

1.1813
1.1813
1.1813

1.1813
1.1813
1.1813

1.1292
1.1292
1.1292

1.1292
1.1292
1.1292

Pound Sterling (GBP)

Pound Sterling (GBP)

Pound Sterling (GBP)
Pound Sterling (GBP)
Pound Sterling (GBP)

Pound Sterling (GBP)
Pound Sterling (GBP)
Pound Sterling (GBP)

1.3204

1.3204

1.2800

1.2800

1.3204
1.3204
1.3204

1.2768
1.3204
1.3204
1.2768
1.3204

1.2800
1.2800
1.2800

1.3356
1.2800
1.2800
1.3356
1.2800

1.2768
1.2768
1.2768

1.2882
1.2768
1.2768
1.2882
1.2768

1.3356
1.3356
1.3356

1.3356
1.3356
1.3356

1.2882
1.2882
1.2882

1.2882
1.2882
1.2882

Swiss Franc (CHF)

Swiss Franc (CHF)

Swiss Franc (CHF)
Swiss Franc (CHF)
Swiss Franc (CHF)

Swiss Franc (CHF)
Swiss Franc (CHF)
Swiss Franc (CHF)

1.0350

1.0350

1.0161

1.0161

1.0350
1.0350
1.0350

1.0062
1.0350
1.0350
1.0062
1.0350

1.0161
1.0161
1.0161

1.0228
1.0161
1.0161
1.0228
1.0161

1.0062
1.0062
1.0062

1.0156
1.0062
1.0062
1.0156
1.0062

1.0228
1.0228
1.0228

1.0228
1.0228
1.0228

1.0156
1.0156
1.0156

1.0156
1.0156
1.0156

Australian Dollar (AUD)

Australian Dollar (AUD)

Australian Dollar (AUD)
Australian Dollar (AUD)
Australian Dollar (AUD)

Australian Dollar (AUD)
Australian Dollar (AUD)
Australian Dollar (AUD)

0.7023

0.7023

0.7059

0.7059

0.7023
0.7023
0.7023

0.6954
0.7023
0.7023
0.6954
0.7023

0.7059
0.7059
0.7059

0.7478
0.7059
0.7059
0.7478
0.7059

0.6954
0.6954
0.6954

0.7666
0.6954
0.6954
0.7666
0.6954

0.7478
0.7478
0.7478

0.7478
0.7478
0.7478

0.7666
0.7666
0.7666

0.7666
0.7666
0.7666

Canadian Dollar (CAD)

Canadian Dollar (CAD)

Canadian Dollar (CAD)
Canadian Dollar (CAD)
Canadian Dollar (CAD)

Canadian Dollar (CAD)
Canadian Dollar (CAD)
Canadian Dollar (CAD)

0.7696

0.7696

0.7337

0.7337

0.7696
0.7696
0.7696

0.7535
0.7696
0.7696
0.7535
0.7696

0.7337
0.7337
0.7337

0.7719
0.7337
0.7337
0.7719
0.7337

0.7535
0.7535
0.7535

0.7710
0.7535
0.7535
0.7710
0.7535

0.7719
0.7719
0.7719

0.7719
0.7719
0.7719

0.7710
0.7710
0.7710

0.7710
0.7710
0.7710

Japanese Yen (JPY)

Japanese Yen (JPY)

Japanese Yen (JPY)
Japanese Yen (JPY)
Japanese Yen (JPY)

Japanese Yen (JPY)
Japanese Yen (JPY)
Japanese Yen (JPY)

0.0092

0.0092

0.0091

0.0091

0.0092
0.0092
0.0092

0.0092
0.0092
0.0092
0.0092
0.0092

0.0091
0.0091
0.0091

0.0091
0.0091
0.0091
0.0091
0.0091

0.0092
0.0092
0.0092

0.0089
0.0092
0.0092
0.0089
0.0092

0.0091
0.0091
0.0091

0.0091
0.0091
0.0091

0.0089
0.0089
0.0089

0.0089
0.0089
0.0089

Chinese Yuan (CNY)

Chinese Yuan (CNY)

Chinese Yuan (CNY)
Chinese Yuan (CNY)
Chinese Yuan (CNY)

Chinese Yuan (CNY)
Chinese Yuan (CNY)
Chinese Yuan (CNY)

0.1437

0.1437

0.1454

0.1454

0.1437
0.1437
0.1437

0.1448
0.1437
0.1437
0.1448
0.1437

0.1454
0.1454
0.1454

0.1514
0.1454
0.1454
0.1514
0.1454

0.1448
0.1448
0.1448

0.1480
0.1448
0.1448
0.1480
0.1448

0.1514
0.1514
0.1514

0.1514
0.1514
0.1514

0.1480
0.1480
0.1480

0.1480
0.1480
0.1480

We determined that we operate as one operating segment in accordance with the Financial Accounting Standards
We determined that we operate as one operating segment in accordance with the Financial Accounting Standards
Board (FASB) Accounting Standards Codification (ASC) Topic 280, Segment Reporting. Our chief operating decision
Board (FASB) Accounting Standards Codification (ASC) Topic 280, Segment Reporting. Our chief operating decision
maker (CODM) makes decisions based on the Company as a whole. In addition, we have a common basis of
maker (CODM) makes decisions based on the Company as a whole. In addition, we have a common basis of
organization and types of products and services which derive revenues and consistent product margins. Accordingly,
organization and types of products and services which derive revenues and consistent product margins. Accordingly,
we operate and make decisions as one reporting unit.
we operate and make decisions as one reporting unit.

We determined that we operate as one operating segment in accordance with the Financial Accounting Standards
We determined that we operate as one operating segment in accordance with the Financial Accounting Standards
We determined that we operate as one operating segment in accordance with the Financial Accounting Standards
We determined that we operate as one operating segment in accordance with the Financial Accounting Standards
We determined that we operate as one operating segment in accordance with the Financial Accounting Standards
We determined that we operate as one operating segment in accordance with the Financial Accounting Standards
Board (FASB) Accounting Standards Codification (ASC) Topic 280, Segment Reporting. Our chief operating decision
Board (FASB) Accounting Standards Codification (ASC) Topic 280, Segment Reporting. Our chief operating decision
Board (FASB) Accounting Standards Codification (ASC) Topic 280, Segment Reporting. Our chief operating decision
Board (FASB) Accounting Standards Codification (ASC) Topic 280, Segment Reporting. Our chief operating decision
Board (FASB) Accounting Standards Codification (ASC) Topic 280, Segment Reporting. Our chief operating decision
Board (FASB) Accounting Standards Codification (ASC) Topic 280, Segment Reporting. Our chief operating decision
maker (CODM) makes decisions based on the Company as a whole. In addition, we have a common basis of
maker (CODM) makes decisions based on the Company as a whole. In addition, we have a common basis of
maker (CODM) makes decisions based on the Company as a whole. In addition, we have a common basis of
maker (CODM) makes decisions based on the Company as a whole. In addition, we have a common basis of
maker (CODM) makes decisions based on the Company as a whole. In addition, we have a common basis of
maker (CODM) makes decisions based on the Company as a whole. In addition, we have a common basis of
organization and types of products and services which derive revenues and consistent product margins. Accordingly,
organization and types of products and services which derive revenues and consistent product margins. Accordingly,
organization and types of products and services which derive revenues and consistent product margins. Accordingly,
organization and types of products and services which derive revenues and consistent product margins. Accordingly,
organization and types of products and services which derive revenues and consistent product margins. Accordingly,
organization and types of products and services which derive revenues and consistent product margins. Accordingly,
we operate and make decisions as one reporting unit.
we operate and make decisions as one reporting unit.
we operate and make decisions as one reporting unit.
we operate and make decisions as one reporting unit.
we operate and make decisions as one reporting unit.
we operate and make decisions as one reporting unit.

Beginning January 1, 2018, we recognize revenues when control of promised goods or services transfers to our
Beginning January 1, 2018, we recognize revenues when control of promised goods or services transfers to our
Beginning January 1, 2018, we recognize revenues when control of promised goods or services transfers to our
Beginning January 1, 2018, we recognize revenues when control of promised goods or services transfers to our
Beginning January 1, 2018, we recognize revenues when control of promised goods or services transfers to our
Beginning January 1, 2018, we recognize revenues when control of promised goods or services transfers to our
Beginning January 1, 2018, we recognize revenues when control of promised goods or services transfers to our
Beginning January 1, 2018, we recognize revenues when control of promised goods or services transfers to our
customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or
customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or
customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or
customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or
customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or
customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or
customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or
customers in an amount that reflects the consideration that is expected to be received in exchange for those goods or
services. The majority of our sales revenue continues to be recognized when products are shipped to the customers at
services. The majority of our sales revenue continues to be recognized when products are shipped to the customers at
services. The majority of our sales revenue continues to be recognized when products are shipped to the customers at
services. The majority of our sales revenue continues to be recognized when products are shipped to the customers at
services. The majority of our sales revenue continues to be recognized when products are shipped to the customers at
services. The majority of our sales revenue continues to be recognized when products are shipped to the customers at
services. The majority of our sales revenue continues to be recognized when products are shipped to the customers at
services. The majority of our sales revenue continues to be recognized when products are shipped to the customers at
which point control transfers. Prior to January 1, 2018, payments for milestones, generally based on the achievement
which point control transfers. Prior to January 1, 2018, payments for milestones, generally based on the achievement
which point control transfers. Prior to January 1, 2018, payments for milestones, generally based on the achievement
which point control transfers. Prior to January 1, 2018, payments for milestones, generally based on the achievement
which point control transfers. Prior to January 1, 2018, payments for milestones, generally based on the achievement
which point control transfers. Prior to January 1, 2018, payments for milestones, generally based on the achievement
which point control transfers. Prior to January 1, 2018, payments for milestones, generally based on the achievement
which point control transfers. Prior to January 1, 2018, payments for milestones, generally based on the achievement
of substantive and at-risk performance criteria, were recognized in full at such time as the specified milestone had
of substantive and at-risk performance criteria, were recognized in full at such time as the specified milestone had
of substantive and at-risk performance criteria, were recognized in full at such time as the specified milestone had
of substantive and at-risk performance criteria, were recognized in full at such time as the specified milestone had
of substantive and at-risk performance criteria, were recognized in full at such time as the specified milestone had
of substantive and at-risk performance criteria, were recognized in full at such time as the specified milestone had
of substantive and at-risk performance criteria, were recognized in full at such time as the specified milestone had
of substantive and at-risk performance criteria, were recognized in full at such time as the specified milestone had
been achieved according to the terms of the agreement. See Note 4 "Revenue" for further discussion of accounting
been achieved according to the terms of the agreement. See Note 4 "Revenue" for further discussion of accounting
been achieved according to the terms of the agreement. See Note 4 "Revenue" for further discussion of accounting
been achieved according to the terms of the agreement. See Note 4 "Revenue" for further discussion of accounting
been achieved according to the terms of the agreement. See Note 4 "Revenue" for further discussion of accounting
been achieved according to the terms of the agreement. See Note 4 "Revenue" for further discussion of accounting
been achieved according to the terms of the agreement. See Note 4 "Revenue" for further discussion of accounting
been achieved according to the terms of the agreement. See Note 4 "Revenue" for further discussion of accounting
for milestone payments after adoption of ASC 606 Revenue from Contracts with Customers.
for milestone payments after adoption of ASC 606 Revenue from Contracts with Customers.
for milestone payments after adoption of ASC 606 Revenue from Contracts with Customers.
for milestone payments after adoption of ASC 606 Revenue from Contracts with Customers.
for milestone payments after adoption of ASC 606 Revenue from Contracts with Customers.
for milestone payments after adoption of ASC 606 Revenue from Contracts with Customers.
for milestone payments after adoption of ASC 606 Revenue from Contracts with Customers.
for milestone payments after adoption of ASC 606 Revenue from Contracts with Customers.

We provide warranties on our products against defects in materials and workmanship for a period of 1 year. A
provision for estimated future warranty costs is recorded in cost of sales at the time product revenue is recognized.
Product warranty obligations are included in accrued and other current liabilities in the accompanying consolidated
balance sheets.

Research and product development costs are expensed as incurred. Research and development expenses consist
primarily of salaries and related expenses, facility costs, and amounts paid to contract research organizations and
laboratories for the provision of services and materials as well as costs for internal use or clinical trials.

We recognize government grants when there is reasonable assurance that all conditions will be complied with and
the grant will be received. Our government grants generally represent subsidies for specified activities and are
therefore recognized when earned as a reduction of the expenses recorded for the activity that the grants are
intended to compensate. Thus, when the grant relates to research and development expense, the grant is recognized
over the same period that the related costs are incurred. Otherwise, amounts received under government grants are
148
recorded as liabilities in the balance sheet. When the grant relates to an asset, the nominal amount of the grant is
deducted from the carrying amount of the asset and recognized over the same period that the related asset is

depreciated.

they occur.

Borrowing costs directly attributable to the acquisition, construction or production of an asset that takes a substantial

period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective assets

(qualifying asset) when such borrowing costs are significant. All other borrowing costs are expensed in the period

Shipping and handling costs charged to customers are recorded as revenue in the period that the related product

sale revenue is recorded. Associated costs of shipping and handling are included in sales and marketing expenses.

For the years ended December 31, 2019, 2018 and 2017, shipping and handling costs totaled $27.9 million,

$28.4 million and $28.6 million, respectively.

The costs of advertising are expensed as incurred and are included as a component of sales and marketing expense.

Advertising costs for the years ended December 31, 2019, 2018 and 2017 were $8.1 million, $8.1 million and

$7.2 million, respectively.

General and administrative expenses primarily represent the costs required to support administrative infrastructure.

These costs include licensing costs in connection with continued investments information technology improvements,

including cyber security, across the organization as well as personnel in administrative functions.

We incur indirect acquisition and business integration costs in connection with business combinations. These costs

represent incremental costs that we believe would not have been incurred absent the business combinations. Major

components of these costs include consulting and related fees incurred to integrate or restructure the acquired

operations, payroll and related costs for employees remaining with the Company on a transitional basis and public

relations, advertising and media costs for re-branding of the combined organization.

Foreign Currency TranslationSegment InformationRevenue RecognitionWarranty(US$ equivalent for one)Closing rate atDecember 31,Annual average rate20192018201920182017Research and DevelopmentGovernment GrantsBorrowing CostsShipping and Handling Income and CostsAdvertising CostsGeneral and AdministrativeRestructuring, Acquisition, Integration and OtherForeign Currency TranslationSegment InformationRevenue RecognitionWarranty(US$ equivalent for one)Closing rate atDecember 31,Annual average rate20192018201920182017Foreign Currency TranslationSegment InformationRevenue RecognitionWarranty(US$ equivalent for one)Closing rate atDecember 31,Annual average rate20192018201920182017Foreign Currency TranslationSegment InformationRevenue RecognitionWarranty(US$ equivalent for one)Closing rate atDecember 31,Annual average rate20192018201920182017Foreign Currency TranslationSegment InformationRevenue RecognitionWarranty(US$ equivalent for one)Closing rate atDecember 31,Annual average rate20192018201920182017Foreign Currency TranslationSegment InformationRevenue RecognitionWarranty(US$ equivalent for one)Closing rate atDecember 31,Annual average rate20192018201920182017Foreign Currency TranslationSegment InformationRevenue RecognitionWarranty(US$ equivalent for one)Closing rate atDecember 31,Annual average rate20192018201920182017Foreign Currency TranslationSegment InformationRevenue RecognitionWarranty(US$ equivalent for one)Closing rate atDecember 31,Annual average rate20192018201920182017We provide warranties on our products against defects in materials and workmanship for a period of 1 year. A

provision for estimated future warranty costs is recorded in cost of sales at the time product revenue is recognized.

Product warranty obligations are included in accrued and other current liabilities in the accompanying consolidated
balance sheets.
F I N A N C I A L   R E S U LT S Notes to consolidated financial statements

Research and product development costs are expensed as incurred. Research and development expenses consist
primarily of salaries and related expenses, facility costs, and amounts paid to contract research organizations and
laboratories for the provision of services and materials as well as costs for internal use or clinical trials.

We recognize government grants when there is reasonable assurance that all conditions will be complied with and
the grant will be received. Our government grants generally represent subsidies for specified activities and are
therefore recognized when earned as a reduction of the expenses recorded for the activity that the grants are
intended to compensate. Thus, when the grant relates to research and development expense, the grant is recognized
over the same period that the related costs are incurred. Otherwise, amounts received under government grants are
recorded as liabilities in the balance sheet. When the grant relates to an asset, the nominal amount of the grant is
deducted from the carrying amount of the asset and recognized over the same period that the related asset is
depreciated.

Borrowing costs directly attributable to the acquisition, construction or production of an asset that takes a substantial
period of time to get ready for its intended use or sale are capitalized as part of the cost of the respective assets
(qualifying asset) when such borrowing costs are significant. All other borrowing costs are expensed in the period
they occur.

Shipping and handling costs charged to customers are recorded as revenue in the period that the related product
sale revenue is recorded. Associated costs of shipping and handling are included in sales and marketing expenses.
For the years ended December 31, 2019, 2018 and 2017, shipping and handling costs totaled $27.9 million,
$28.4 million and $28.6 million, respectively.

The costs of advertising are expensed as incurred and are included as a component of sales and marketing expense.
Advertising costs for the years ended December 31, 2019, 2018 and 2017 were $8.1 million, $8.1 million and
$7.2 million, respectively.

General and administrative expenses primarily represent the costs required to support administrative infrastructure.
These costs include licensing costs in connection with continued investments information technology improvements,
including cyber security, across the organization as well as personnel in administrative functions.

We incur indirect acquisition and business integration costs in connection with business combinations. These costs
represent incremental costs that we believe would not have been incurred absent the business combinations. Major
components of these costs include consulting and related fees incurred to integrate or restructure the acquired
operations, payroll and related costs for employees remaining with the Company on a transitional basis and public
relations, advertising and media costs for re-branding of the combined organization.

149

Research and DevelopmentGovernment GrantsBorrowing CostsShipping and Handling Income and CostsAdvertising CostsGeneral and AdministrativeRestructuring, Acquisition, Integration and OtherRestructuring costs include personnel costs (principally termination benefits) as well as contract and other costs,
primarily contract termination costs. Termination benefits are accounted for in accordance with FASB ASC Topic
712, Compensation - Nonretirement Postemployment Benefits, and are recorded when it is probable that employees
will be entitled to benefits and the amounts can be reasonably estimated. Estimates of termination benefits are based
on the frequency of past termination benefits, the similarity of benefits under the current plan and prior plans, and the
existence of statutory required minimum benefits. Contract and other costs are accounted for in accordance with
FASB ASC Topic 420, Exit or Disposal Cost Obligations and are recorded when the liability is incurred. The specific
restructuring measures and associated estimated costs are based on management's best business judgment under the
existing circumstances at the time the estimates are made. If future events require changes to these estimates, such
adjustments will be reflected in the period of the revised estimate.

We account for income taxes under the liability method. Under this method, total income tax expense is the amount
of income taxes expected to be payable for the current year plus the change from the beginning of the year for
deferred income tax assets and liabilities established for the expected further tax consequences resulting from
differences in the financial statement carrying amount and the tax basis of assets and liabilities. Deferred tax assets
and/or liabilities are determined by multiplying the differences between the financial statement carrying amount and
the tax reporting bases for assets and liabilities by the enacted tax rates expected to be in effect when such
differences are recovered or settled. Deferred tax assets are reduced by a valuation allowance to the amount more
likely than not to be realized. The effect on deferred taxes of a change in tax rates is recognized in income in the
period that includes the enactment date.

Tax benefits are initially recognized in the financial statements when it is more likely than not that the position will be
sustained upon examination by the tax authorities. Such tax positions are initially and subsequently measured as the
largest amount of tax benefit that is greater than 50 percent likely of being realized upon settlement with the taxing
authority using the cumulative probability method, assuming the tax authority has full knowledge of the position and
all relevant facts. Our policy is to recognize interest accrued related to unrecognized tax benefits in interest expense
and penalties within the income tax expense.

We enter into derivative financial instrument contracts to minimize the variability of cash flows or income statement
impact associated with the anticipated transactions being hedged or to hedge fluctuating interest rates. As changes
in foreign currency or interest rate impact the value of anticipated transactions, the fair value of the forward or swap
contracts also changes, offsetting foreign currency or interest rate fluctuations. Derivative instruments are recorded on
the balance sheet at fair value. Changes in fair value of derivatives are recorded in current earnings or other
comprehensive income, depending on whether a derivative is designated as part of a hedge transaction.

Compensation cost for all share-based payments is recorded based on the grant date fair value, less an estimate for
pre-vesting forfeitures, recognized in expense over the service period using an accelerated method.

Forfeiture Rate — This is the estimated percentage of grants that are expected to be forfeited or canceled on an
annual basis before becoming fully vested. We estimated the forfeiture rate based on historical forfeiture experience.

Restricted Stock Units and Performance Stock Units: Restricted stock units and performance stock units represent rights
to receive Common Shares at a future date. The fair market value of restricted and performance stock units is
determined based on the number of stock units granted and the fair market value of our shares on the grant date.
The fair market value at the time of the grant, less an estimate for pre-vesting forfeitures, is recognized in expense
over the vesting period. At each reporting period, the estimated performance achievement of the performance stock
units is assessed and any change in the estimated achievement is recorded on a cumulative basis in the period of
150
adjustment.

Income TaxesDerivative InstrumentsShare-Based PaymentsRestructuring costs include personnel costs (principally termination benefits) as well as contract and other costs,

primarily contract termination costs. Termination benefits are accounted for in accordance with FASB ASC Topic

712, Compensation - Nonretirement Postemployment Benefits, and are recorded when it is probable that employees

will be entitled to benefits and the amounts can be reasonably estimated. Estimates of termination benefits are based

on the frequency of past termination benefits, the similarity of benefits under the current plan and prior plans, and the

existence of statutory required minimum benefits. Contract and other costs are accounted for in accordance with

FASB ASC Topic 420, Exit or Disposal Cost Obligations and are recorded when the liability is incurred. The specific

restructuring measures and associated estimated costs are based on management's best business judgment under the

existing circumstances at the time the estimates are made. If future events require changes to these estimates, such

adjustments will be reflected in the period of the revised estimate.

We account for income taxes under the liability method. Under this method, total income tax expense is the amount

of income taxes expected to be payable for the current year plus the change from the beginning of the year for

deferred income tax assets and liabilities established for the expected further tax consequences resulting from

differences in the financial statement carrying amount and the tax basis of assets and liabilities. Deferred tax assets

and/or liabilities are determined by multiplying the differences between the financial statement carrying amount and

the tax reporting bases for assets and liabilities by the enacted tax rates expected to be in effect when such

differences are recovered or settled. Deferred tax assets are reduced by a valuation allowance to the amount more

likely than not to be realized. The effect on deferred taxes of a change in tax rates is recognized in income in the

period that includes the enactment date.

Tax benefits are initially recognized in the financial statements when it is more likely than not that the position will be

sustained upon examination by the tax authorities. Such tax positions are initially and subsequently measured as the

largest amount of tax benefit that is greater than 50 percent likely of being realized upon settlement with the taxing

authority using the cumulative probability method, assuming the tax authority has full knowledge of the position and

all relevant facts. Our policy is to recognize interest accrued related to unrecognized tax benefits in interest expense

and penalties within the income tax expense.

We enter into derivative financial instrument contracts to minimize the variability of cash flows or income statement

impact associated with the anticipated transactions being hedged or to hedge fluctuating interest rates. As changes

in foreign currency or interest rate impact the value of anticipated transactions, the fair value of the forward or swap

contracts also changes, offsetting foreign currency or interest rate fluctuations. Derivative instruments are recorded on

the balance sheet at fair value. Changes in fair value of derivatives are recorded in current earnings or other

comprehensive income, depending on whether a derivative is designated as part of a hedge transaction.

F I N A N C I A L   R E S U LT S Notes to consolidated financial statements

Compensation cost for all share-based payments is recorded based on the grant date fair value, less an estimate for
pre-vesting forfeitures, recognized in expense over the service period using an accelerated method.

Forfeiture Rate — This is the estimated percentage of grants that are expected to be forfeited or canceled on an
annual basis before becoming fully vested. We estimated the forfeiture rate based on historical forfeiture experience.

Restricted Stock Units and Performance Stock Units: Restricted stock units and performance stock units represent rights
to receive Common Shares at a future date. The fair market value of restricted and performance stock units is
determined based on the number of stock units granted and the fair market value of our shares on the grant date.
The fair market value at the time of the grant, less an estimate for pre-vesting forfeitures, is recognized in expense
over the vesting period. At each reporting period, the estimated performance achievement of the performance stock
units is assessed and any change in the estimated achievement is recorded on a cumulative basis in the period of
adjustment.

Cash and cash equivalents consist of cash on deposit in banks and other cash invested temporarily in various
Cash and cash equivalents consist of cash on deposit in banks and other cash invested temporarily in various
Cash and cash equivalents consist of cash on deposit in banks and other cash invested temporarily in various
instruments that are short-term and highly liquid, and having an original maturity of less than 90 days at the date of
instruments that are short-term and highly liquid, and having an original maturity of less than 90 days at the date of
instruments that are short-term and highly liquid, and having an original maturity of less than 90 days at the date of
purchase.
purchase.
purchase.

Cash and cash equivalents consist of cash on deposit in banks and other cash invested temporarily in various
instruments that are short-term and highly liquid, and having an original maturity of less than 90 days at the date of
purchase.

Cash at bank and on hand
Cash at bank and on hand
Cash at bank and on hand

Cash at bank and on hand

Short-term bank deposits
Short-term bank deposits
Short-term bank deposits

Short-term bank deposits

Cash and Cash Equivalents
Cash and Cash Equivalents
Cash and Cash Equivalents

Cash and Cash Equivalents

$ 189,569
$ 189,569
$ 189,569

$ 189,569

$ 208,083
$ 208,083
$ 208,083

$ 208,083

434,078
434,078
434,078

434,078

950,996
950,996
950,996

950,996

$ 623,647
$ 623,647
$ 623,647

$ 623,647

$ 1,159,079
$ 1,159,079
$ 1,159,079

$ 1,159,079

Restricted cash includes cash that is subject to legal restriction in connection with a tender offer and not available for
Restricted cash includes cash that is subject to legal restriction in connection with a tender offer and not available for
Restricted cash includes cash that is subject to legal restriction in connection with a tender offer and not available for
Restricted cash includes cash that is subject to legal restriction in connection with a tender offer and not available for
general operating purposes. As of December 31, 2019, we have $5.7 million of restricted cash.
general operating purposes. As of December 31, 2019, we have $5.7 million of restricted cash.
general operating purposes. As of December 31, 2019, we have $5.7 million of restricted cash.
general operating purposes. As of December 31, 2019, we have $5.7 million of restricted cash.

Short-term investments are classified as “available for sale” and stated at fair value, which is equivalent to the
Short-term investments are classified as “available for sale” and stated at fair value, which is equivalent to the
Short-term investments are classified as “available for sale” and stated at fair value, which is equivalent to the
amortized cost, in the accompanying balance sheet. Interest income is accrued when earned and changes in fair
amortized cost, in the accompanying balance sheet. Interest income is accrued when earned and changes in fair
amortized cost, in the accompanying balance sheet. Interest income is accrued when earned and changes in fair
market values are reflected in other income (expense), net. The amortization of premiums and accretion of discounts
market values are reflected in other income (expense), net. The amortization of premiums and accretion of discounts
market values are reflected in other income (expense), net. The amortization of premiums and accretion of discounts
to maturity arising from acquisition is included in interest income. A decline in fair value that is judged to be other-
to maturity arising from acquisition is included in interest income. A decline in fair value that is judged to be other-
to maturity arising from acquisition is included in interest income. A decline in fair value that is judged to be other-
than-temporary is accounted for as a realized loss and the write-down is included in the consolidated statements of
than-temporary is accounted for as a realized loss and the write-down is included in the consolidated statements of
than-temporary is accounted for as a realized loss and the write-down is included in the consolidated statements of
income. Realized gains and losses, determined on a specific identification basis on the sale of short-term investments,
income. Realized gains and losses, determined on a specific identification basis on the sale of short-term investments,
income. Realized gains and losses, determined on a specific identification basis on the sale of short-term investments,
are included in income.
are included in income.
are included in income.

Short-term investments are classified as “available for sale” and stated at fair value, which is equivalent to the
amortized cost, in the accompanying balance sheet. Interest income is accrued when earned and changes in fair
market values are reflected in other income (expense), net. The amortization of premiums and accretion of discounts
to maturity arising from acquisition is included in interest income. A decline in fair value that is judged to be other-
than-temporary is accounted for as a realized loss and the write-down is included in the consolidated statements of
income. Realized gains and losses, determined on a specific identification basis on the sale of short-term investments,
are included in income.

The carrying amount of cash and cash equivalents, notes receivable, accounts receivable, accounts payable and
The carrying amount of cash and cash equivalents, notes receivable, accounts receivable, accounts payable and
The carrying amount of cash and cash equivalents, notes receivable, accounts receivable, accounts payable and
accrued liabilities approximate their fair values because of the short maturities of those instruments. The carrying
accrued liabilities approximate their fair values because of the short maturities of those instruments. The carrying
accrued liabilities approximate their fair values because of the short maturities of those instruments. The carrying
value of our variable rate debt and capital leases approximates their fair values because of the short maturities
value of our variable rate debt and capital leases approximates their fair values because of the short maturities
value of our variable rate debt and capital leases approximates their fair values because of the short maturities
and/or interest rates which are comparable to those available to us on similar terms. The fair values of the Cash
and/or interest rates which are comparable to those available to us on similar terms. The fair values of the Cash
and/or interest rates which are comparable to those available to us on similar terms. The fair values of the Cash
Convertible Notes are based on an estimation using available over-the-counter market information. The fair values of
Convertible Notes are based on an estimation using available over-the-counter market information. The fair values of
Convertible Notes are based on an estimation using available over-the-counter market information. The fair values of
the Private Placement Senior Notes were estimated using the changes in the U.S. Treasury rates and the fair value of
the Private Placement Senior Notes were estimated using the changes in the U.S. Treasury rates and the fair value of
the Private Placement Senior Notes were estimated using the changes in the U.S. Treasury rates and the fair value of
the German Private Placement is based on an estimation using changes in the euro swap rates
the German Private Placement is based on an estimation using changes in the euro swap rates
the German Private Placement is based on an estimation using changes in the euro swap rates

The carrying amount of cash and cash equivalents, notes receivable, accounts receivable, accounts payable and
accrued liabilities approximate their fair values because of the short maturities of those instruments. The carrying
value of our variable rate debt and capital leases approximates their fair values because of the short maturities
and/or interest rates which are comparable to those available to us on similar terms. The fair values of the Cash
Convertible Notes are based on an estimation using available over-the-counter market information. The fair values of
the Private Placement Senior Notes were estimated using the changes in the U.S. Treasury rates and the fair value of
the German Private Placement is based on an estimation using changes in the euro swap rates

Our accounts receivable are unsecured and we are at risk to the extent such amounts become uncollectible. We
Our accounts receivable are unsecured and we are at risk to the extent such amounts become uncollectible. We
Our accounts receivable are unsecured and we are at risk to the extent such amounts become uncollectible. We
Our accounts receivable are unsecured and we are at risk to the extent such amounts become uncollectible. We
continually monitor accounts receivable balances, and provide for an allowance for doubtful accounts at the time
continually monitor accounts receivable balances, and provide for an allowance for doubtful accounts at the time
continually monitor accounts receivable balances, and provide for an allowance for doubtful accounts at the time
continually monitor accounts receivable balances, and provide for an allowance for doubtful accounts at the time
collection becomes questionable based on payment history or age of the receivable. Amounts determined to be
collection becomes questionable based on payment history or age of the receivable. Amounts determined to be
collection becomes questionable based on payment history or age of the receivable. Amounts determined to be
collection becomes questionable based on payment history or age of the receivable. Amounts determined to be
uncollectible are written off against the allowance. For the years ended December 31, 2019, 2018 and 2017,
uncollectible are written off against the allowance. For the years ended December 31, 2019, 2018 and 2017,
uncollectible are written off against the allowance. For the years ended December 31, 2019, 2018 and 2017,
uncollectible are written off against the allowance. For the years ended December 31, 2019, 2018 and 2017,
write-offs of accounts receivable totaled $5.8 million, $2.8 million and $3.2 million, respectively, while provisions
write-offs of accounts receivable totaled $5.8 million, $2.8 million and $3.2 million, respectively, while provisions
write-offs of accounts receivable totaled $5.8 million, $2.8 million and $3.2 million, respectively, while provisions
write-offs of accounts receivable totaled $5.8 million, $2.8 million and $3.2 million, respectively, while provisions
for doubtful accounts which were charged to expense totaled $8.7 million, $4.4 million and $3.1 million,
for doubtful accounts which were charged to expense totaled $8.7 million, $4.4 million and $3.1 million,
for doubtful accounts which were charged to expense totaled $8.7 million, $4.4 million and $3.1 million,
for doubtful accounts which were charged to expense totaled $8.7 million, $4.4 million and $3.1 million,
151
respectively. For all years presented, no single customer represented more than ten percent of accounts receivable or
respectively. For all years presented, no single customer represented more than ten percent of accounts receivable or
respectively. For all years presented, no single customer represented more than ten percent of accounts receivable or
respectively. For all years presented, no single customer represented more than ten percent of accounts receivable or
consolidated net sales.
consolidated net sales.
consolidated net sales.
consolidated net sales.

Inventories are stated at the lower of cost or net realizable value, determined on either a weighted average cost

Inventories are stated at the lower of cost or net realizable value, determined on either a weighted average cost

Inventories are stated at the lower of cost or net realizable value, determined on either a weighted average cost

Inventories are stated at the lower of cost or net realizable value, determined on either a weighted average cost

basis or a standard cost basis which is regularly adjusted to actual. Inventories include material, direct labor and

basis or a standard cost basis which is regularly adjusted to actual. Inventories include material, direct labor and

basis or a standard cost basis which is regularly adjusted to actual. Inventories include material, direct labor and

basis or a standard cost basis which is regularly adjusted to actual. Inventories include material, direct labor and

overhead costs and are reduced for estimated obsolescence. Inventories consisted of the following as of December

overhead costs and are reduced for estimated obsolescence. Inventories consisted of the following as of December

overhead costs and are reduced for estimated obsolescence. Inventories consisted of the following as of December

overhead costs and are reduced for estimated obsolescence. Inventories consisted of the following as of December

31, 2019 and 2018:

31, 2019 and 2018:

31, 2019 and 2018:

31, 2019 and 2018:

Income TaxesDerivative InstrumentsShare-Based PaymentsCash and Cash EquivalentsRestricted CashShort-Term InvestmentsFair Value of Financial InstrumentsAccounts Receivable and Allowance for Doubtful AccountsInventories(in thousands)20192018Cash and Cash EquivalentsRestricted CashShort-Term InvestmentsFair Value of Financial InstrumentsAccounts Receivable and Allowance for Doubtful AccountsInventories(in thousands)20192018Cash and Cash EquivalentsRestricted CashShort-Term InvestmentsFair Value of Financial InstrumentsAccounts Receivable and Allowance for Doubtful AccountsInventories(in thousands)20192018Cash and Cash EquivalentsRestricted CashShort-Term InvestmentsFair Value of Financial InstrumentsAccounts Receivable and Allowance for Doubtful AccountsInventories(in thousands)20192018Cash and cash equivalents consist of cash on deposit in banks and other cash invested temporarily in various

instruments that are short-term and highly liquid, and having an original maturity of less than 90 days at the date of

purchase.

Cash at bank and on hand

Short-term bank deposits

Cash and Cash Equivalents

$ 189,569

$ 208,083

434,078

950,996

$ 623,647

$ 1,159,079

Restricted cash includes cash that is subject to legal restriction in connection with a tender offer and not available for

general operating purposes. As of December 31, 2019, we have $5.7 million of restricted cash.

Short-term investments are classified as “available for sale” and stated at fair value, which is equivalent to the

amortized cost, in the accompanying balance sheet. Interest income is accrued when earned and changes in fair

market values are reflected in other income (expense), net. The amortization of premiums and accretion of discounts

to maturity arising from acquisition is included in interest income. A decline in fair value that is judged to be other-

than-temporary is accounted for as a realized loss and the write-down is included in the consolidated statements of

income. Realized gains and losses, determined on a specific identification basis on the sale of short-term investments,

are included in income.

The carrying amount of cash and cash equivalents, notes receivable, accounts receivable, accounts payable and
accrued liabilities approximate their fair values because of the short maturities of those instruments. The carrying
value of our variable rate debt and capital leases approximates their fair values because of the short maturities
and/or interest rates which are comparable to those available to us on similar terms. The fair values of the Cash
Convertible Notes are based on an estimation using available over-the-counter market information. The fair values of
the Private Placement Senior Notes were estimated using the changes in the U.S. Treasury rates and the fair value of
the German Private Placement is based on an estimation using changes in the euro swap rates

Our accounts receivable are unsecured and we are at risk to the extent such amounts become uncollectible. We
continually monitor accounts receivable balances, and provide for an allowance for doubtful accounts at the time
collection becomes questionable based on payment history or age of the receivable. Amounts determined to be
uncollectible are written off against the allowance. For the years ended December 31, 2019, 2018 and 2017,
write-offs of accounts receivable totaled $5.8 million, $2.8 million and $3.2 million, respectively, while provisions
for doubtful accounts which were charged to expense totaled $8.7 million, $4.4 million and $3.1 million,
respectively. For all years presented, no single customer represented more than ten percent of accounts receivable or
consolidated net sales.

Inventories are stated at the lower of cost or net realizable value, determined on either a weighted average cost
basis or a standard cost basis which is regularly adjusted to actual. Inventories include material, direct labor and
overhead costs and are reduced for estimated obsolescence. Inventories consisted of the following as of December
31, 2019 and 2018:

Raw materials
Raw materials
Raw materials

Raw materials

Work in process
Work in process
Work in process

Work in process

Finished goods
Finished goods
Finished goods

Finished goods

$ 26,077
$ 26,077
$ 26,077

$ 26,077

$ 25,819
$ 25,819
$ 25,819

$ 25,819

45,729
45,729
45,729

45,729

38,659
38,659
38,659

38,659

98,898
98,898
98,898

98,898

98,434
98,434
98,434

98,434

$ 170,704
$ 170,704
$ 170,704

$ 170,704

$ 162,912
$ 162,912
$ 162,912

$ 162,912

Property, plant and equipment, including equipment acquired under capital lease obligations, are stated at cost less
Property, plant and equipment, including equipment acquired under capital lease obligations, are stated at cost less
Property, plant and equipment, including equipment acquired under capital lease obligations, are stated at cost less
Property, plant and equipment, including equipment acquired under capital lease obligations, are stated at cost less
accumulated amortization. Capitalized internal-use software costs include only those direct costs associated with the
accumulated amortization. Capitalized internal-use software costs include only those direct costs associated with the
accumulated amortization. Capitalized internal-use software costs include only those direct costs associated with the
accumulated amortization. Capitalized internal-use software costs include only those direct costs associated with the
actual development or acquisition of computer software solely to meet internal needs and cloud-based applications to
actual development or acquisition of computer software solely to meet internal needs and cloud-based applications to
actual development or acquisition of computer software solely to meet internal needs and cloud-based applications to
actual development or acquisition of computer software solely to meet internal needs and cloud-based applications to
deliver our service and comprise costs associated with the design, coding, installation and testing of the system.
deliver our service and comprise costs associated with the design, coding, installation and testing of the system.
deliver our service and comprise costs associated with the design, coding, installation and testing of the system.
deliver our service and comprise costs associated with the design, coding, installation and testing of the system.
Costs associated with preliminary development, such as the evaluation and selection of alternatives, as well as
Costs associated with preliminary development, such as the evaluation and selection of alternatives, as well as
Costs associated with preliminary development, such as the evaluation and selection of alternatives, as well as
Costs associated with preliminary development, such as the evaluation and selection of alternatives, as well as
training, maintenance and support are expensed as incurred. Costs for software to be sold, leased or otherwise
training, maintenance and support are expensed as incurred. Costs for software to be sold, leased or otherwise
training, maintenance and support are expensed as incurred. Costs for software to be sold, leased or otherwise
training, maintenance and support are expensed as incurred. Costs for software to be sold, leased or otherwise
marketed that are related to the conceptual formulation and design are expensed as incurred. Costs incurred to
marketed that are related to the conceptual formulation and design are expensed as incurred. Costs incurred to
marketed that are related to the conceptual formulation and design are expensed as incurred. Costs incurred to
marketed that are related to the conceptual formulation and design are expensed as incurred. Costs incurred to
produce software products and the software components of products to be sold, leased or marketed after
produce software products and the software components of products to be sold, leased or marketed after
produce software products and the software components of products to be sold, leased or marketed after
produce software products and the software components of products to be sold, leased or marketed after
technological feasibility is established are capitalized and amortized in accordance with the accounting standards
technological feasibility is established are capitalized and amortized in accordance with the accounting standards
technological feasibility is established are capitalized and amortized in accordance with the accounting standards
technological feasibility is established are capitalized and amortized in accordance with the accounting standards
for the costs of software to be sold, leased, or otherwise marketed. All other depreciation is computed using the
for the costs of software to be sold, leased, or otherwise marketed. All other depreciation is computed using the
for the costs of software to be sold, leased, or otherwise marketed. All other depreciation is computed using the
for the costs of software to be sold, leased, or otherwise marketed. All other depreciation is computed using the
straight-line method over the estimated useful lives of the assets (3 to 40 years). Amortization of leasehold
straight-line method over the estimated useful lives of the assets (3 to 40 years). Amortization of leasehold
straight-line method over the estimated useful lives of the assets (3 to 40 years). Amortization of leasehold
straight-line method over the estimated useful lives of the assets (3 to 40 years). Amortization of leasehold
improvements is computed on a straight-line basis over the lesser of the remaining life of the lease or the estimated
improvements is computed on a straight-line basis over the lesser of the remaining life of the lease or the estimated
improvements is computed on a straight-line basis over the lesser of the remaining life of the lease or the estimated
improvements is computed on a straight-line basis over the lesser of the remaining life of the lease or the estimated
useful life of the improvement asset. We have a policy of capitalizing expenditures that materially increase assets’
useful life of the improvement asset. We have a policy of capitalizing expenditures that materially increase assets’
useful life of the improvement asset. We have a policy of capitalizing expenditures that materially increase assets’
useful life of the improvement asset. We have a policy of capitalizing expenditures that materially increase assets’
useful lives and charging ordinary maintenance and repairs to operations as incurred. When property or equipment
useful lives and charging ordinary maintenance and repairs to operations as incurred. When property or equipment
useful lives and charging ordinary maintenance and repairs to operations as incurred. When property or equipment
useful lives and charging ordinary maintenance and repairs to operations as incurred. When property or equipment
is disposed of, the cost and related accumulated depreciation and amortization are removed from the accounts and
is disposed of, the cost and related accumulated depreciation and amortization are removed from the accounts and
is disposed of, the cost and related accumulated depreciation and amortization are removed from the accounts and
is disposed of, the cost and related accumulated depreciation and amortization are removed from the accounts and
any gain or loss is included in earnings.
any gain or loss is included in earnings.
any gain or loss is included in earnings.
any gain or loss is included in earnings.

We include the results of operations of the businesses that we acquire as of the acquisition date. The purchase price
We include the results of operations of the businesses that we acquire as of the acquisition date. The purchase price
We include the results of operations of the businesses that we acquire as of the acquisition date. The purchase price
We include the results of operations of the businesses that we acquire as of the acquisition date. The purchase price
of an acquired business is allocated to the individual assets acquired and liabilities assumed based on their fair
of an acquired business is allocated to the individual assets acquired and liabilities assumed based on their fair
of an acquired business is allocated to the individual assets acquired and liabilities assumed based on their fair
of an acquired business is allocated to the individual assets acquired and liabilities assumed based on their fair
values at the date of acquisition. Those fair values are determined using income, cost and market approaches, most
values at the date of acquisition. Those fair values are determined using income, cost and market approaches, most
values at the date of acquisition. Those fair values are determined using income, cost and market approaches, most
values at the date of acquisition. Those fair values are determined using income, cost and market approaches, most
of which depend upon significant inputs that are not observable in the market, or level 3 measurements. The excess
of which depend upon significant inputs that are not observable in the market, or level 3 measurements. The excess
of which depend upon significant inputs that are not observable in the market, or level 3 measurements. The excess
of which depend upon significant inputs that are not observable in the market, or level 3 measurements. The excess
of purchase price over the fair value of identifiable assets acquired and liabilities assumed is recorded as goodwill.
of purchase price over the fair value of identifiable assets acquired and liabilities assumed is recorded as goodwill.
of purchase price over the fair value of identifiable assets acquired and liabilities assumed is recorded as goodwill.
of purchase price over the fair value of identifiable assets acquired and liabilities assumed is recorded as goodwill.
Acquisition-related expenses are recognized separately from the business combinations and are expensed as
Acquisition-related expenses are recognized separately from the business combinations and are expensed as
Acquisition-related expenses are recognized separately from the business combinations and are expensed as
Acquisition-related expenses are recognized separately from the business combinations and are expensed as
incurred.
incurred.
incurred.
incurred.
152

The purchase price for some business combinations includes consideration that is contingent on the achievement of
The purchase price for some business combinations includes consideration that is contingent on the achievement of
The purchase price for some business combinations includes consideration that is contingent on the achievement of

The purchase price for some business combinations includes consideration that is contingent on the achievement of

net sales or earnings targets by the acquired business. Contingent consideration is measured initially and on a

net sales or earnings targets by the acquired business. Contingent consideration is measured initially and on a

net sales or earnings targets by the acquired business. Contingent consideration is measured initially and on a

net sales or earnings targets by the acquired business. Contingent consideration is measured initially and on a

recurring basis at fair value. Payments to settle the acquisition-date fair value of contingent consideration are

recurring basis at fair value. Payments to settle the acquisition-date fair value of contingent consideration are

recurring basis at fair value. Payments to settle the acquisition-date fair value of contingent consideration are

recurring basis at fair value. Payments to settle the acquisition-date fair value of contingent consideration are

presented as financing activities on the statement of cash flows; any payments in excess of the acquisition-date fair

presented as financing activities on the statement of cash flows; any payments in excess of the acquisition-date fair

presented as financing activities on the statement of cash flows; any payments in excess of the acquisition-date fair

presented as financing activities on the statement of cash flows; any payments in excess of the acquisition-date fair

value are presented as operating activities.

value are presented as operating activities.

value are presented as operating activities.

value are presented as operating activities.

Acquired intangibles with alternative future uses are carried at cost less accumulated amortization and consist of

Acquired intangibles with alternative future uses are carried at cost less accumulated amortization and consist of

Acquired intangibles with alternative future uses are carried at cost less accumulated amortization and consist of

Acquired intangibles with alternative future uses are carried at cost less accumulated amortization and consist of

licenses to technology held by third parties and other acquired intangible assets. Amortization is computed over the

licenses to technology held by third parties and other acquired intangible assets. Amortization is computed over the

licenses to technology held by third parties and other acquired intangible assets. Amortization is computed over the

licenses to technology held by third parties and other acquired intangible assets. Amortization is computed over the

estimated useful life of the underlying patents, which has historically ranged from 1 to 20 years. Purchased

estimated useful life of the underlying patents, which has historically ranged from 1 to 20 years. Purchased

estimated useful life of the underlying patents, which has historically ranged from 1 to 20 years. Purchased

estimated useful life of the underlying patents, which has historically ranged from 1 to 20 years. Purchased

intangible assets acquired in business combinations, other than goodwill, are amortized over their estimated useful

intangible assets acquired in business combinations, other than goodwill, are amortized over their estimated useful

intangible assets acquired in business combinations, other than goodwill, are amortized over their estimated useful

intangible assets acquired in business combinations, other than goodwill, are amortized over their estimated useful

lives unless these lives are determined to be indefinite. Intangibles are assessed for recoverability considering the

lives unless these lives are determined to be indefinite. Intangibles are assessed for recoverability considering the

lives unless these lives are determined to be indefinite. Intangibles are assessed for recoverability considering the

lives unless these lives are determined to be indefinite. Intangibles are assessed for recoverability considering the

contract life and the period of time over which the intangible will contribute to future cash flow. The unamortized cost

contract life and the period of time over which the intangible will contribute to future cash flow. The unamortized cost

contract life and the period of time over which the intangible will contribute to future cash flow. The unamortized cost

contract life and the period of time over which the intangible will contribute to future cash flow. The unamortized cost

of intangible assets, where cash flows are independent and identifiable from other assets, is evaluated periodically

of intangible assets, where cash flows are independent and identifiable from other assets, is evaluated periodically

of intangible assets, where cash flows are independent and identifiable from other assets, is evaluated periodically

of intangible assets, where cash flows are independent and identifiable from other assets, is evaluated periodically

and adjusted, if necessary, if events and circumstances indicate that a decline in value below the carrying amount

and adjusted, if necessary, if events and circumstances indicate that a decline in value below the carrying amount

and adjusted, if necessary, if events and circumstances indicate that a decline in value below the carrying amount

and adjusted, if necessary, if events and circumstances indicate that a decline in value below the carrying amount

has occurred. Intangible asset impairments recorded during the year ended December 31, 2019 are further

has occurred. Intangible asset impairments recorded during the year ended December 31, 2019 are further

has occurred. Intangible asset impairments recorded during the year ended December 31, 2019 are further

has occurred. Intangible asset impairments recorded during the year ended December 31, 2019 are further

discussed in Note 6 "Restructuring".

discussed in Note 6 "Restructuring".

discussed in Note 6 "Restructuring".

discussed in Note 6 "Restructuring".

Cash and Cash EquivalentsRestricted CashShort-Term InvestmentsFair Value of Financial InstrumentsAccounts Receivable and Allowance for Doubtful AccountsInventories(in thousands)20192018Property, Plant and EquipmentBusiness CombinationsAcquired Intangibles and Goodwill(in thousands)20192018Total inventories, netProperty, Plant and EquipmentBusiness CombinationsAcquired Intangibles and Goodwill(in thousands)20192018Total inventories, netProperty, Plant and EquipmentBusiness CombinationsAcquired Intangibles and Goodwill(in thousands)20192018Total inventories, netProperty, Plant and EquipmentBusiness CombinationsAcquired Intangibles and Goodwill(in thousands)20192018Total inventories, netRaw materials

Work in process

Finished goods

$ 26,077

$ 25,819

45,729

38,659

98,898

98,434

$ 170,704

$ 162,912

Property, plant and equipment, including equipment acquired under capital lease obligations, are stated at cost less

accumulated amortization. Capitalized internal-use software costs include only those direct costs associated with the

actual development or acquisition of computer software solely to meet internal needs and cloud-based applications to

deliver our service and comprise costs associated with the design, coding, installation and testing of the system.

Costs associated with preliminary development, such as the evaluation and selection of alternatives, as well as

training, maintenance and support are expensed as incurred. Costs for software to be sold, leased or otherwise

marketed that are related to the conceptual formulation and design are expensed as incurred. Costs incurred to
produce software products and the software components of products to be sold, leased or marketed after
technological feasibility is established are capitalized and amortized in accordance with the accounting standards
F I N A N C I A L   R E S U LT S Notes to consolidated financial statements
for the costs of software to be sold, leased, or otherwise marketed. All other depreciation is computed using the
straight-line method over the estimated useful lives of the assets (3 to 40 years). Amortization of leasehold
improvements is computed on a straight-line basis over the lesser of the remaining life of the lease or the estimated
useful life of the improvement asset. We have a policy of capitalizing expenditures that materially increase assets’
useful lives and charging ordinary maintenance and repairs to operations as incurred. When property or equipment
is disposed of, the cost and related accumulated depreciation and amortization are removed from the accounts and
any gain or loss is included in earnings.

We include the results of operations of the businesses that we acquire as of the acquisition date. The purchase price
of an acquired business is allocated to the individual assets acquired and liabilities assumed based on their fair
values at the date of acquisition. Those fair values are determined using income, cost and market approaches, most
of which depend upon significant inputs that are not observable in the market, or level 3 measurements. The excess
of purchase price over the fair value of identifiable assets acquired and liabilities assumed is recorded as goodwill.
Acquisition-related expenses are recognized separately from the business combinations and are expensed as
incurred.

The purchase price for some business combinations includes consideration that is contingent on the achievement of
net sales or earnings targets by the acquired business. Contingent consideration is measured initially and on a
recurring basis at fair value. Payments to settle the acquisition-date fair value of contingent consideration are
presented as financing activities on the statement of cash flows; any payments in excess of the acquisition-date fair
value are presented as operating activities.

Acquired intangibles with alternative future uses are carried at cost less accumulated amortization and consist of
licenses to technology held by third parties and other acquired intangible assets. Amortization is computed over the
estimated useful life of the underlying patents, which has historically ranged from 1 to 20 years. Purchased
intangible assets acquired in business combinations, other than goodwill, are amortized over their estimated useful
lives unless these lives are determined to be indefinite. Intangibles are assessed for recoverability considering the
contract life and the period of time over which the intangible will contribute to future cash flow. The unamortized cost
of intangible assets, where cash flows are independent and identifiable from other assets, is evaluated periodically
and adjusted, if necessary, if events and circumstances indicate that a decline in value below the carrying amount
has occurred. Intangible asset impairments recorded during the year ended December 31, 2019 are further
discussed in Note 6 "Restructuring".

Amortization expense related to developed technology and patent and license rights which have been acquired in a
business combination is included in cost of sales. Amortization of trademarks, customer base and non-compete
agreements which have been acquired in a business combination is recorded in operating expense under the
caption 'acquisition-related intangible amortization'. Amortization expenses of intangible assets not acquired in a
business combination are recorded within either the cost of sales, research and development or sales and marketing
line items based on the use of the asset.

We dispose the gross carrying amount and accumulated amortization of fully amortized intangible assets from
historic business combinations once they are considered fully integrated into our business.

The fair value of in-process research and development (IPR&D) acquired in a business combination is capitalized as
an indefinite-lived intangible asset until completion or abandonment of the related research and development
activities. IPR&D is tested for impairment annually or when any event or circumstance indicates that the fair value
may be below the carrying value. If and when research and development is complete, the associated asset is
amortized over the estimated useful life.

Goodwill represents the difference between the purchase price and the estimated fair value of the net assets acquired
arising from business combinations. Goodwill is subject to impairment tests annually or earlier if indicators of
potential impairment exist, using a fair-value-based approach. We have elected to perform our annual test for
indications of impairment as of October 1st of each year. Following the annual impairment tests for the years ended
December 31, 2019, 2018 and 2017, goodwill has not been impaired.

153

We have investments in non-marketable equity securities issued by privately held companies. These investments are

included in other long-term assets in the accompanying consolidated balance sheets. Non-marketable investments

through which we exercise significant influence but do not have control are accounted for using the equity method.

We monitor for changes in circumstances that may require a reassessment of the level of influence. Following the

adoption of ASU 2016-01 on January 1, 2018, our non-marketable equity securities not accounted for under the

equity method are either carried at fair value or under the measurement alternative. Under the measurement

alternative, the carrying value is measured at cost, less any impairment, plus or minus changes resulting from

observable price changes in orderly transactions for identical or similar investments of the same issuer. Adjustments

are determined primarily based on a market approach as of the transaction date.

Investments are evaluated periodically, or when impairment indicators are noted, to determine if declines in value

are other-than-temporary. In making that determination, we consider all available evidence relating to the realizable

value of a security. This evidence includes, but is not limited to, the following:

›

adverse financial conditions of a specific issuer, segment, industry, region or other variables;

›

the length of time and the extent to which the fair value has been less than cost; and

›

the financial condition and near-term prospects of the issuer.

We consider whether the fair values of any of our non-marketable investments have declined below their carrying

value whenever adverse events or changes in circumstances indicate that recorded values may not be recoverable. If

any such decline is considered to be other than temporary (based on various factors, including historical financial

results, product development activities and the overall health of the affiliate’s industry), then a write-down of the

investment would be recorded in operating expense to its estimated fair value.

We evaluate at the inception of each arrangement whether we have made an investment in an entity that is

considered a variable interest entity (VIE) or if we hold other variable interests in an arrangement that is considered a

variable interest entity (VIE). We consolidate VIEs when we are the primary beneficiary. The primary beneficiary of a

VIE is the party that meets both of the following criteria: (1) has the power to make decisions that most significantly

Property, Plant and EquipmentBusiness CombinationsAcquired Intangibles and Goodwill(in thousands)20192018Total inventories, netNon-Marketable InvestmentsVariable Interest EntitiesAmortization expense related to developed technology and patent and license rights which have been acquired in a

business combination is included in cost of sales. Amortization of trademarks, customer base and non-compete

agreements which have been acquired in a business combination is recorded in operating expense under the

caption 'acquisition-related intangible amortization'. Amortization expenses of intangible assets not acquired in a

business combination are recorded within either the cost of sales, research and development or sales and marketing

line items based on the use of the asset.

We dispose the gross carrying amount and accumulated amortization of fully amortized intangible assets from
historic business combinations once they are considered fully integrated into our business.

The fair value of in-process research and development (IPR&D) acquired in a business combination is capitalized as
an indefinite-lived intangible asset until completion or abandonment of the related research and development
activities. IPR&D is tested for impairment annually or when any event or circumstance indicates that the fair value
may be below the carrying value. If and when research and development is complete, the associated asset is
amortized over the estimated useful life.

Goodwill represents the difference between the purchase price and the estimated fair value of the net assets acquired
arising from business combinations. Goodwill is subject to impairment tests annually or earlier if indicators of
potential impairment exist, using a fair-value-based approach. We have elected to perform our annual test for
indications of impairment as of October 1st of each year. Following the annual impairment tests for the years ended
December 31, 2019, 2018 and 2017, goodwill has not been impaired.

We have investments in non-marketable equity securities issued by privately held companies. These investments are
included in other long-term assets in the accompanying consolidated balance sheets. Non-marketable investments
through which we exercise significant influence but do not have control are accounted for using the equity method.
We monitor for changes in circumstances that may require a reassessment of the level of influence. Following the
adoption of ASU 2016-01 on January 1, 2018, our non-marketable equity securities not accounted for under the
equity method are either carried at fair value or under the measurement alternative. Under the measurement
alternative, the carrying value is measured at cost, less any impairment, plus or minus changes resulting from
observable price changes in orderly transactions for identical or similar investments of the same issuer. Adjustments
are determined primarily based on a market approach as of the transaction date.

Investments are evaluated periodically, or when impairment indicators are noted, to determine if declines in value
are other-than-temporary. In making that determination, we consider all available evidence relating to the realizable
value of a security. This evidence includes, but is not limited to, the following:

›

adverse financial conditions of a specific issuer, segment, industry, region or other variables;

›

the length of time and the extent to which the fair value has been less than cost; and

›

the financial condition and near-term prospects of the issuer.

We consider whether the fair values of any of our non-marketable investments have declined below their carrying
value whenever adverse events or changes in circumstances indicate that recorded values may not be recoverable. If
any such decline is considered to be other than temporary (based on various factors, including historical financial
results, product development activities and the overall health of the affiliate’s industry), then a write-down of the
investment would be recorded in operating expense to its estimated fair value.

We evaluate at the inception of each arrangement whether we have made an investment in an entity that is
considered a variable interest entity (VIE) or if we hold other variable interests in an arrangement that is considered a
variable interest entity (VIE). We consolidate VIEs when we are the primary beneficiary. The primary beneficiary of a
VIE is the party that meets both of the following criteria: (1) has the power to make decisions that most significantly
affect the economic performance of the VIE; and (2) has the obligation to absorb losses or the right to receive
benefits that in either case could potentially be significant to the VIE. Periodically, we assess whether any changes in
our interest or relationship with the entity affect our determination of whether the entity is still a VIE and, if so,
whether we are the primary beneficiary. If we are not the primary beneficiary in a VIE, we account for the investment
or other variable interests in a VIE as an investment in a non-marketable investment or in accordance with other
applicable GAAP.

We review our long-lived assets for impairment whenever events or changes in circumstances indicate that the
carrying amount of an asset or a group of assets may not be recoverable. We consider, amongst other indicators, a
history of operating losses or a change in expected sales levels to be indicators of potential impairment. Assets are
grouped and evaluated for impairment at the lowest level for which there are identifiable cash flows that are largely
independent of the cash flows of other groups of assets. If an asset is determined to be impaired, the loss is
154
measured as the amount by which the carrying amount of the asset exceeds fair value which is determined by
applicable market prices, when available. When market prices are not available, we generally measure fair value

by discounting projected future cash flows of the asset. Considerable judgment is necessary to estimate discounted

future cash flows. Accordingly, actual results could differ from such estimates.

4. Revenue

Our revenues are reported net of sales and value added taxes and accruals for estimated rebates and returns and

are derived primarily from the sale of consumable and instrumentation products, and to a much lesser extent, from

the sale of services, intellectual property and technology. Revenue is recognized upon transfer of control of promised

products or services to customers in an amount that reflects the consideration we expect to receive in exchange for

those products or services. We enter into contracts that can include various combinations of products and services,

which are generally distinct and accounted for as separate performance obligations. The transaction price is

allocated to performance obligations based on their relative stand-alone selling prices.

We offer warranties on our products. Certain of our warranties are assurance-type in nature and do not cover

anything beyond ensuring that the product is functioning as intended. Based on the guidance in Topic 606,

assurance-type warranties do not represent separate performance obligations. The Company also sells separately-

priced service contracts which qualify as service-type warranties and represent separate performance obligations.

We sell our products and services both directly to customers and through distributors generally under agreements

with payment terms typically less than 90 days and in most cases not exceeding one year and therefore contracts do

not contain a significant financing component.

: In the last three years, revenue from consumable product sales has accounted for

approximately 78-80% of our net sales and revenue is recognized when performance obligations under the terms of

a contract with a customer are satisfied. The majority of our contracts have a single performance obligation to

transfer a product or multiple performance obligations to transfer multiple products concurrently. Accordingly, we

recognize revenue when control of the products has transferred to the customer, which is generally at the time of

shipment of products as this is when title and risk of loss have been transferred. In addition, invoicing typically occurs

at this time so this is when we have a present right to payment. Revenue is measured as the amount of consideration

we expect to receive in exchange for transferring products and is generally based upon a negotiated formula, list or

fixed price.

10% of our net sales.

: Revenues from related products include software-as-a-service (SaaS), licenses, intellectual property

and patent sales, royalties and milestone payments and over the last three years has accounted for approximately 8-

Non-Marketable InvestmentsVariable Interest EntitiesImpairment of Long-Lived AssetsNature of Goods and ServicesConsumable and Related RevenueConsumable ProductsRelated RevenueF I N A N C I A L   R E S U LT S Notes to consolidated financial statements
affect the economic performance of the VIE; and (2) has the obligation to absorb losses or the right to receive
benefits that in either case could potentially be significant to the VIE. Periodically, we assess whether any changes in
our interest or relationship with the entity affect our determination of whether the entity is still a VIE and, if so,
whether we are the primary beneficiary. If we are not the primary beneficiary in a VIE, we account for the investment
or other variable interests in a VIE as an investment in a non-marketable investment or in accordance with other
applicable GAAP.

We review our long-lived assets for impairment whenever events or changes in circumstances indicate that the
carrying amount of an asset or a group of assets may not be recoverable. We consider, amongst other indicators, a
history of operating losses or a change in expected sales levels to be indicators of potential impairment. Assets are
grouped and evaluated for impairment at the lowest level for which there are identifiable cash flows that are largely
independent of the cash flows of other groups of assets. If an asset is determined to be impaired, the loss is
measured as the amount by which the carrying amount of the asset exceeds fair value which is determined by
applicable market prices, when available. When market prices are not available, we generally measure fair value
by discounting projected future cash flows of the asset. Considerable judgment is necessary to estimate discounted
future cash flows. Accordingly, actual results could differ from such estimates.

4. Revenue

Our revenues are reported net of sales and value added taxes and accruals for estimated rebates and returns and
are derived primarily from the sale of consumable and instrumentation products, and to a much lesser extent, from
the sale of services, intellectual property and technology. Revenue is recognized upon transfer of control of promised
products or services to customers in an amount that reflects the consideration we expect to receive in exchange for
those products or services. We enter into contracts that can include various combinations of products and services,
which are generally distinct and accounted for as separate performance obligations. The transaction price is
allocated to performance obligations based on their relative stand-alone selling prices.

We offer warranties on our products. Certain of our warranties are assurance-type in nature and do not cover
anything beyond ensuring that the product is functioning as intended. Based on the guidance in Topic 606,
assurance-type warranties do not represent separate performance obligations. The Company also sells separately-
priced service contracts which qualify as service-type warranties and represent separate performance obligations.

We sell our products and services both directly to customers and through distributors generally under agreements
with payment terms typically less than 90 days and in most cases not exceeding one year and therefore contracts do
not contain a significant financing component.

: In the last three years, revenue from consumable product sales has accounted for

approximately 78-80% of our net sales and revenue is recognized when performance obligations under the terms of
a contract with a customer are satisfied. The majority of our contracts have a single performance obligation to
transfer a product or multiple performance obligations to transfer multiple products concurrently. Accordingly, we
recognize revenue when control of the products has transferred to the customer, which is generally at the time of
shipment of products as this is when title and risk of loss have been transferred. In addition, invoicing typically occurs
at this time so this is when we have a present right to payment. Revenue is measured as the amount of consideration
we expect to receive in exchange for transferring products and is generally based upon a negotiated formula, list or
fixed price.

: Revenues from related products include software-as-a-service (SaaS), licenses, intellectual property
and patent sales, royalties and milestone payments and over the last three years has accounted for approximately 8-
10% of our net sales.

155

Impairment of Long-Lived AssetsNature of Goods and ServicesConsumable and Related RevenueConsumable ProductsRelated RevenueSaaS arrangements: Revenue from SaaS arrangements, which allow customers to use hosted software over the
contract period without taking possession of the software, is recognized over the duration of the agreement unless
the terms of the agreement indicate that revenue should be recognized in a different pattern, for example based on
usage.

Licenses: Licenses for on-site software, which allow customers to use the software as it exists when made available,
are sold as perpetual licenses or term licenses. Revenue from on-site licenses are recognized upfront at the point in
time at the later of when the software is made available to the customer and the beginning of the license term. When
a portion of the transaction price is allocated to a performance obligation to provide support and/or updates,
revenue is recognized as the updates/support are provided, generally over the life of the license. Fees from research
collaborations include payments for technology transfer and access rights. Royalties from licensees of intellectual
property are based on sales of licensed products and revenues are recognized at the later of (i) when the related
sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been
satisfied (or partially satisfied).

Milestone Payments: At the inception of each companion diagnostic co-development arrangement that includes
development milestone payments, which represent variable consideration, we evaluate whether the milestones are
probable of being reached and estimate the amount to be included in the transaction price using the most likely
amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is
included in the transaction price. Milestone payments that are not within our control, such as milestones which are
achieved through regulatory approvals, are considered to be constrained and excluded from the transaction price
until those approvals are received. Revenue is recognized following the input method as this is considered to best
depict the timing of the transfer of control. This involves measuring actual hours incurred to date as a proportion of
the total budgeted hours of the project. At the end of each subsequent reporting period, the proportion of completion
is trued-up. We also re-evaluate the probability of achievement of development milestones and any related constraint
on a periodic basis, and if necessary, adjust our estimate of the overall transaction price. Any such adjustments are
recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment.

Revenue from instrumentation includes the instrumentation equipment, installation, training and other instrumentation
services, such as extended warranty services or product maintenance contracts and over the last three years has
accounted for approximately 11-12% of net sales. Revenue from instrumentation equipment is recognized when the
customer obtains control of the instrument which is predominantly at the time of delivery or when title has transferred
to the customer. Service revenue is recognized over the term of the service period as the customers benefit from the
service throughout the service period. Revenue related to services performed on a time-and-materials basis is
recognized when performed.

The majority of our revenue is derived from contracts (i) with an original expected length of one year or less and (ii)
contracts for which we recognize revenue at the amount in which we have the right to invoice as product is
delivered. We have elected the practical expedient not to disclose the value of remaining performance obligations
associated with these types of contracts.

However, we have certain companion diagnostic co-development contracts in which our performance obligations
extend over multiple years. As of December 31, 2019, we had $20.4 million of remaining performance obligations
for which the transaction price is not constrained related to these contracts of which we expect to recognize over the
next 12 to 18 months.

Revenue expected to be recognized in any future year related to remaining performance obligations, excluding
revenue pertaining to contracts that have an original expected duration of one year or less, contracts where revenue
is recognized as invoiced and contracts with variable consideration related to undelivered performance obligations,
156
is not material.

InstrumentsContract EstimatesSaaS arrangements: Revenue from SaaS arrangements, which allow customers to use hosted software over the

contract period without taking possession of the software, is recognized over the duration of the agreement unless

the terms of the agreement indicate that revenue should be recognized in a different pattern, for example based on

usage.

Licenses: Licenses for on-site software, which allow customers to use the software as it exists when made available,

are sold as perpetual licenses or term licenses. Revenue from on-site licenses are recognized upfront at the point in

time at the later of when the software is made available to the customer and the beginning of the license term. When

a portion of the transaction price is allocated to a performance obligation to provide support and/or updates,

revenue is recognized as the updates/support are provided, generally over the life of the license. Fees from research

collaborations include payments for technology transfer and access rights. Royalties from licensees of intellectual

property are based on sales of licensed products and revenues are recognized at the later of (i) when the related

sales occur, or (ii) when the performance obligation to which some or all of the royalty has been allocated has been

satisfied (or partially satisfied).

Milestone Payments: At the inception of each companion diagnostic co-development arrangement that includes

development milestone payments, which represent variable consideration, we evaluate whether the milestones are

probable of being reached and estimate the amount to be included in the transaction price using the most likely

amount method. If it is probable that a significant revenue reversal would not occur, the associated milestone value is

included in the transaction price. Milestone payments that are not within our control, such as milestones which are

achieved through regulatory approvals, are considered to be constrained and excluded from the transaction price

until those approvals are received. Revenue is recognized following the input method as this is considered to best

depict the timing of the transfer of control. This involves measuring actual hours incurred to date as a proportion of

the total budgeted hours of the project. At the end of each subsequent reporting period, the proportion of completion

is trued-up. We also re-evaluate the probability of achievement of development milestones and any related constraint

on a periodic basis, and if necessary, adjust our estimate of the overall transaction price. Any such adjustments are

recorded on a cumulative catch-up basis, which would affect revenues and earnings in the period of adjustment.

Revenue from instrumentation includes the instrumentation equipment, installation, training and other instrumentation

services, such as extended warranty services or product maintenance contracts and over the last three years has

accounted for approximately 11-12% of net sales. Revenue from instrumentation equipment is recognized when the

customer obtains control of the instrument which is predominantly at the time of delivery or when title has transferred

to the customer. Service revenue is recognized over the term of the service period as the customers benefit from the

service throughout the service period. Revenue related to services performed on a time-and-materials basis is
recognized when performed.

F I N A N C I A L   R E S U LT S Notes to consolidated financial statements

The majority of our revenue is derived from contracts (i) with an original expected length of one year or less and (ii)
contracts for which we recognize revenue at the amount in which we have the right to invoice as product is
delivered. We have elected the practical expedient not to disclose the value of remaining performance obligations
associated with these types of contracts.

However, we have certain companion diagnostic co-development contracts in which our performance obligations
extend over multiple years. As of December 31, 2019, we had $20.4 million of remaining performance obligations
for which the transaction price is not constrained related to these contracts of which we expect to recognize over the
next 12 to 18 months.

Revenue expected to be recognized in any future year related to remaining performance obligations, excluding
revenue pertaining to contracts that have an original expected duration of one year or less, contracts where revenue
is recognized as invoiced and contracts with variable consideration related to undelivered performance obligations,
is not material.

The timing of revenue recognition, billings and cash collections can result in billed accounts receivable, unbilled
receivables (contract assets), and customer advances and deposits (contract liabilities) in the consolidated balance
sheet.

Contract assets as of December 31, 2019 and 2018 totaled $5.5 million and $6.9 million, respectively, and are
included in prepaid expenses and other current assets in the accompanying consolidated balance sheets and relate
to the companion diagnostic co-development contracts discussed above.

Contract liabilities primarily relate to advances or deposits received from customers before revenue is recognized
and is primarily related to instrument service and software subscription revenue. As of December 31, 2019 and
2018, contract liabilities totaled $56.2 million and $54.3 million, respectively, of which $48.5 million and $45.3
million is included in accrued and other current liabilities, respectively, and $7.7 million and $9.0 million in included
in other long-term liabilities, respectively. During the twelve months ended December 31, 2019 and 2018, we
satisfied the associated performance obligations and recognized revenue of $48.3 million and $44.5 million,
respectively, related to advance customer payments previously received.

We disaggregate our revenue based on product categories and customer class as shown in the tables below for the
years ended December 31, 2019, 2018 and 2017:

Molecular Diagnostics

Life Sciences

Academia / Applied Testing

Pharma

Molecular Diagnostics

Life Sciences

Academia / Applied Testing

Pharma

Total

$ 665,866

688,281

418,518

269,763

$ 71,266

101,011

69,114

31,897

$ 737,132

789,292

487,632

301,660

$ 1,354,147

$ 172,277

$ 1,526,424

$ 649,602

665,857

407,370

258,487

$ 82,197

104,192

72,131

32,061

$ 731,799

770,049

479,501

157

290,548

$ 1,315,459

$ 186,389

$ 1,501,848

InstrumentsContract EstimatesContract BalancesDisaggregation of Revenue(in thousands)2019Consumablesand relatedInstrumentsTotalTotal2018Consumablesand relatedInstrumentsTotalThe timing of revenue recognition, billings and cash collections can result in billed accounts receivable, unbilled

receivables (contract assets), and customer advances and deposits (contract liabilities) in the consolidated balance

sheet.

Contract assets as of December 31, 2019 and 2018 totaled $5.5 million and $6.9 million, respectively, and are

included in prepaid expenses and other current assets in the accompanying consolidated balance sheets and relate

to the companion diagnostic co-development contracts discussed above.

Contract liabilities primarily relate to advances or deposits received from customers before revenue is recognized
and is primarily related to instrument service and software subscription revenue. As of December 31, 2019 and
2018, contract liabilities totaled $56.2 million and $54.3 million, respectively, of which $48.5 million and $45.3
million is included in accrued and other current liabilities, respectively, and $7.7 million and $9.0 million in included
in other long-term liabilities, respectively. During the twelve months ended December 31, 2019 and 2018, we
satisfied the associated performance obligations and recognized revenue of $48.3 million and $44.5 million,
respectively, related to advance customer payments previously received.

We disaggregate our revenue based on product categories and customer class as shown in the tables below for the
years ended December 31, 2019, 2018 and 2017:

Molecular Diagnostics

Life Sciences

Academia / Applied Testing

Pharma

Molecular Diagnostics

Life Sciences

Academia / Applied Testing

Pharma

Total

Molecular Diagnostics

Life Sciences

Academia / Applied Testing

Pharma

$ 665,866

688,281

418,518

269,763

$ 71,266

101,011

69,114

31,897

$ 737,132

789,292

487,632

301,660

$ 1,354,147

$ 172,277

$ 1,526,424

$ 649,602

665,857

407,370

258,487

$ 82,197

104,192

72,131

32,061

$ 731,799

770,049

479,501

290,548

$ 1,315,459

$ 186,389

$ 1,501,848

$ 605,462

$ 77,702

$ 683,164

637,253

392,066

245,187

97,119

67,477

29,642

734,372

459,543

274,829

$ 1,242,715

$ 174,821

$ 1,417,536

Refer to Note 21 "Segment Information" for disclosure of revenue by geographic region.

5. Acquisitions and Divestitures

For acquisitions which have been accounted for as business combinations, the acquired companies’ results have
been included in the accompanying consolidated statements of income from their respective dates of acquisition. Our
acquisitions have historically been made at prices above the fair value of the acquired net assets, resulting in
goodwill, due to expectations of synergies of combining the businesses. These synergies include use of our existing
infrastructure, such as sales force, shared service centers, distribution channels and customer relations, to expand
sales of an acquired business' products; use of the infrastructure of the acquired businesses to cost-effectively expand
sales of our products; and elimination of duplicative facilities, functions and staffing.
158

If the acquired net assets do not constitute a business under the acquisition method of accounting, the transaction is

accounted for as an asset acquisition and no goodwill is recognized. In an asset acquisition, the amount allocated to

acquired IPR&D with no alternative future use is charged to expense at the acquisition date.

In January 2019, we completed the acquisition of N-of-One, Inc., a privately-held U.S. molecular decision support

company and pioneer in clinical interpretation services for complex genomic data located in Concord,

Massachusetts. The cash consideration, net of cash acquired, was $24.5 million. This acquisition was not significant

to the overall consolidated financial statements and as of December 31, 2019, the allocation of the purchase price

was final. The acquisition did not have a material impact to net sales, net income or earnings per share and

therefore no pro forma information has been provided herein.

In the third quarter of 2019, we acquired two additional companies for total cash consideration, net of cash

acquired, of $43.5 million. The purchase price allocations for these acquisitions are preliminary and are based upon

preliminary estimates which used information that was available to management at the time the financial statements

were prepared and these estimates and assumptions are subject to change within the measurement period, up to one

year from the acquisition date. Accordingly, the allocation may change. We continue to gather information about

the assets and liabilities acquired, including the acquired tax balance. These acquisitions were not significant to the

overall consolidated financial statements and the acquisitions did not have a material impact to net sales, net income

or earnings per share. Thus, no pro forma information has been provided herein.

In April 2018, we acquired all shares in STAT-Dx Life, S.L. (STAT-Dx), a privately-held company located in

Barcelona, Spain, which is developing the next generation of multiplex diagnostics for one-step, fully integrated

molecular analysis of common syndromes using a novel system based on real-time PCR technology and proven

QIAGEN chemistries.

Contract BalancesDisaggregation of Revenue(in thousands)2019Consumablesand relatedInstrumentsTotalTotal2018Consumablesand relatedInstrumentsTotalBusiness Combinations and Asset Acquisitions2019 Business Combinations2018 Business Combination(in thousands)2017Consumablesand relatedInstrumentsTotalTotalMolecular Diagnostics

Life Sciences

F I N A N C I A L   R E S U LT S Notes to consolidated financial statements

Academia / Applied Testing

Pharma

$ 605,462

$ 77,702

$ 683,164

637,253

392,066

245,187

97,119

67,477

29,642

734,372

459,543

274,829

$ 1,242,715

$ 174,821

$ 1,417,536

Refer to Note 21 "Segment Information" for disclosure of revenue by geographic region.

5. Acquisitions and Divestitures

For acquisitions which have been accounted for as business combinations, the acquired companies’ results have
been included in the accompanying consolidated statements of income from their respective dates of acquisition. Our
acquisitions have historically been made at prices above the fair value of the acquired net assets, resulting in
goodwill, due to expectations of synergies of combining the businesses. These synergies include use of our existing
infrastructure, such as sales force, shared service centers, distribution channels and customer relations, to expand
sales of an acquired business' products; use of the infrastructure of the acquired businesses to cost-effectively expand
sales of our products; and elimination of duplicative facilities, functions and staffing.

If the acquired net assets do not constitute a business under the acquisition method of accounting, the transaction is
accounted for as an asset acquisition and no goodwill is recognized. In an asset acquisition, the amount allocated to
acquired IPR&D with no alternative future use is charged to expense at the acquisition date.

In January 2019, we completed the acquisition of N-of-One, Inc., a privately-held U.S. molecular decision support
company and pioneer in clinical interpretation services for complex genomic data located in Concord,
Massachusetts. The cash consideration, net of cash acquired, was $24.5 million. This acquisition was not significant
to the overall consolidated financial statements and as of December 31, 2019, the allocation of the purchase price
was final. The acquisition did not have a material impact to net sales, net income or earnings per share and
therefore no pro forma information has been provided herein.

In the third quarter of 2019, we acquired two additional companies for total cash consideration, net of cash
acquired, of $43.5 million. The purchase price allocations for these acquisitions are preliminary and are based upon
preliminary estimates which used information that was available to management at the time the financial statements
were prepared and these estimates and assumptions are subject to change within the measurement period, up to one
year from the acquisition date. Accordingly, the allocation may change. We continue to gather information about
the assets and liabilities acquired, including the acquired tax balance. These acquisitions were not significant to the
overall consolidated financial statements and the acquisitions did not have a material impact to net sales, net income
or earnings per share. Thus, no pro forma information has been provided herein.

In April 2018, we acquired all shares in STAT-Dx Life, S.L. (STAT-Dx), a privately-held company located in
Barcelona, Spain, which is developing the next generation of multiplex diagnostics for one-step, fully integrated
molecular analysis of common syndromes using a novel system based on real-time PCR technology and proven
QIAGEN chemistries.

159

Business Combinations and Asset Acquisitions2019 Business Combinations2018 Business Combination(in thousands)2017Consumablesand relatedInstrumentsTotalTotalThe cash consideration totaled $148.8 million. The acquisition included contingent consideration which is recorded
as part of the purchase price based on the acquisition date fair value. Potential contingent payments through 2024
under the purchase agreement total $44.3 million, of which the fair value of $37.4 million was recorded as
purchase price using a probability-weighted analysis of the future milestones applying discount rates between 6.5%
and 6.9%. Direct acquisition costs totaled $2.0 million.

The final purchase price allocation differed from the initial preliminary purchase price allocation as follows:

Purchase Price:

Cash consideration

Fair value of contingent consideration

Final Allocation:

Cash and cash equivalents

Prepaid expenses and other current assets

Inventories

Income tax receivables

Accounts payable

Accruals and other current liabilities

Fixed and other long-term assets

Developed technology

In-process research and development

Goodwill

Deferred tax liability on fair value of identifiable intangible assets
acquired

$ 148,780

37,377

$ 186,157

$ 148,780

36,751

$ 185,531

$ 7,357

$ 7,357

1,432

1,868

2,213

(1,412)

(1,785)

6,306

31,300

24,300

117,621

(3,043)

1,432

1,868

2,213

(1,412)

(560)

6,434

80,100

—

97,268

(9,169)

$ —

626

$ 626

$ —

—

—

—

—

(1,225)

(128)

(48,800)

24,300

20,353

6,126

The changes in the values of in-process research and development assets and developed technology relate to new
information obtained, that existed at the acquisition date, regarding key assumptions in the valuation model since the
initial purchase price allocation. The weighted average amortization period for the developed technology is 10
years. The goodwill acquired is not deductible for tax purposes.

$ 186,157

$ 185,531

$ 626

In-process research and development relates to technologies that remain in development at the time of acquisition
and which had not yet obtained regulatory approval. During 2019, one development project was completed and a
portion of in-process research and development costs were reclassified into developed technology as further
discussed in Note 11 "Goodwill and Intangible Assets". The remaining technologies within in-process research and
development are expected to be completed within the next two years.

Revenue and earnings in the reporting periods since the acquisition date have not been significant. No pro forma
financial information has been provided herein as the acquisition of STAT-Dx did not have a material impact to our
net sales, net income or earnings per share on a pro forma basis.

In April 2018, we acquired all remaining shares of a privately held entity in which we held a minority interest. The
160
value of the minority interest investment was revalued in connection with the acquisition by $4.8 million and a
corresponding gain was recorded in general and administrative, restructuring, integration and other, net in the

accompanying consolidated statement of income for the year ended December 31, 2018. This acquisition was not

Other 2018 Business Combination(in thousands)FinalPreliminary As of April 27,2018DifferenceTotal 
The cash consideration totaled $148.8 million. The acquisition included contingent consideration which is recorded

as part of the purchase price based on the acquisition date fair value. Potential contingent payments through 2024

under the purchase agreement total $44.3 million, of which the fair value of $37.4 million was recorded as

purchase price using a probability-weighted analysis of the future milestones applying discount rates between 6.5%

and 6.9%. Direct acquisition costs totaled $2.0 million.

The final purchase price allocation differed from the initial preliminary purchase price allocation as follows:

Purchase Price:

Cash consideration

Fair value of contingent consideration

Final Allocation:

Cash and cash equivalents

Prepaid expenses and other current assets

Inventories

Income tax receivables

Accounts payable

Accruals and other current liabilities

Fixed and other long-term assets

Developed technology

In-process research and development

$ 148,780

37,377

$ 186,157

$ 148,780

36,751

$ 185,531

$ 7,357

$ 7,357

1,432

1,868

2,213

(1,412)

(1,785)

6,306

31,300

24,300

117,621

(3,043)

1,432

1,868

2,213

(1,412)

(560)

6,434

80,100

—

97,268

(9,169)

$ —

626

$ 626

$ —

—

—

—

—

(1,225)

(128)

(48,800)

24,300

20,353

6,126

Goodwill

acquired

Deferred tax liability on fair value of identifiable intangible assets

The changes in the values of in-process research and development assets and developed technology relate to new

information obtained, that existed at the acquisition date, regarding key assumptions in the valuation model since the

initial purchase price allocation. The weighted average amortization period for the developed technology is 10

years. The goodwill acquired is not deductible for tax purposes.

$ 186,157

$ 185,531

$ 626

In-process research and development relates to technologies that remain in development at the time of acquisition

and which had not yet obtained regulatory approval. During 2019, one development project was completed and a
portion of in-process research and development costs were reclassified into developed technology as further
discussed in Note 11 "Goodwill and Intangible Assets". The remaining technologies within in-process research and
F I N A N C I A L   R E S U LT S Notes to consolidated financial statements
development are expected to be completed within the next two years.

Revenue and earnings in the reporting periods since the acquisition date have not been significant. No pro forma
financial information has been provided herein as the acquisition of STAT-Dx did not have a material impact to our
net sales, net income or earnings per share on a pro forma basis.

In April 2018, we acquired all remaining shares of a privately held entity in which we held a minority interest. The
value of the minority interest investment was revalued in connection with the acquisition by $4.8 million and a
corresponding gain was recorded in general and administrative, restructuring, integration and other, net in the
accompanying consolidated statement of income for the year ended December 31, 2018. This acquisition was not
significant to the overall consolidated financial statements. The acquisition did not have a material impact to net
sales, net income or earnings per share and therefore no pro forma information has been provided herein.

On January 31, 2019, we acquired the digital PCR asset of Formulatrix, Inc., a developer of laboratory automation
solutions. We paid Formulatrix $125.0 million in cash upon closing and will pay future milestone payments of
$135.9 million in 2020. As of December 31, 2019, $134.3 million is included in accrued and other current
liabilities in the accompanying consolidated balance sheet for the present value of the future expected payments.

In 2019, we sold a portfolio of protein catalysation products for $1.0 million. An immaterial gain was recorded on
the sale. In 2018, we sold a portfolio of veterinary testing products for a total of €15.1 million ($18.5 million), of
which $16.4 million was received in cash and the balance due in April 2020. An $8.0 million gain was recorded
on the sale to other income (expense), net in the accompanying consolidated statements of income for the year-
ended December 31, 2018.

6. Restructuring and Impairments

As part of our restructuring activities, we incur expenses that qualify as exit and disposal costs under U.S. GAAP
including severance and employee costs as well as contract and other costs, primarily contract termination costs, as
well as inventory write-offs and other implementation costs primarily related to consulting fees. Personnel related costs
primarily relate to cash severance and other termination benefits including accelerated share-based compensation.
We also incur expenses that are an integral component of, and are directly attributable to, our restructuring activities
which do not qualify as exit and disposal costs under U.S. GAAP, which consist of asset-related costs such as
intangible asset impairments and other asset related write-offs.

Personnel costs are primarily determined based on established benefit arrangements, local statutory requirements, or
historical benefit practices. We recognize these benefits when payment is probable and estimable. Other benefits
which require future service and are associated to non-recurring benefits are recognized ratably over the future
service period. Other assets, including inventory, are impaired or written-off if the carrying value exceeds the fair
value. All other costs are recognized as incurred.

In the second half of 2019, we decided to suspend development of NGS-related instrument systems and entered into
a new strategic partnership with Illumina to commercialize IVD kits worldwide on Illumina's diagnostic sequencers. In
order to align our business with this new strategy, we began restructuring initiatives to target resource allocation to
growth opportunities in our Sample to Insight portfolio.

Impairments to property, plant and equipment primarily impacted computer software and machinery and equipment.
Costs incurred to either purchase software or produce software products and the software components of products to
be sold, leased or marketed after technological feasibility is established were previously capitalized during the
development of certain NGS-related instrument systems. These long-lived assets were fully impaired due to the
decision to suspend further development. In addition to computer software, certain machinery and equipment assets
were fully impaired given that these assets had no alternative use following the changes announced for this program
and it was estimated that no value was recoverable in a market disposal.

161

Due to the suspended development, intangible assets were also assessed for recoverability. The abandoned assets

include developed technology related to the suspended projects as well as the termination of licenses which were

used exclusively in connection with this program. As a result, we recorded intangible asset impairment charges due

to the conclusion that the identified assets have no alternative use outside of the suspended program and thus are

fully impaired.

Other 2018 Business Combination(in thousands)FinalPreliminary As of April 27,2018DifferenceTotal2019 Asset AcquisitionDivestitures2019 Restructuring 
significant to the overall consolidated financial statements. The acquisition did not have a material impact to net

sales, net income or earnings per share and therefore no pro forma information has been provided herein.

On January 31, 2019, we acquired the digital PCR asset of Formulatrix, Inc., a developer of laboratory automation

solutions. We paid Formulatrix $125.0 million in cash upon closing and will pay future milestone payments of

$135.9 million in 2020. As of December 31, 2019, $134.3 million is included in accrued and other current

liabilities in the accompanying consolidated balance sheet for the present value of the future expected payments.

In 2019, we sold a portfolio of protein catalysation products for $1.0 million. An immaterial gain was recorded on

the sale. In 2018, we sold a portfolio of veterinary testing products for a total of €15.1 million ($18.5 million), of

which $16.4 million was received in cash and the balance due in April 2020. An $8.0 million gain was recorded

on the sale to other income (expense), net in the accompanying consolidated statements of income for the year-

ended December 31, 2018.

6. Restructuring and Impairments

As part of our restructuring activities, we incur expenses that qualify as exit and disposal costs under U.S. GAAP

including severance and employee costs as well as contract and other costs, primarily contract termination costs, as

well as inventory write-offs and other implementation costs primarily related to consulting fees. Personnel related costs

primarily relate to cash severance and other termination benefits including accelerated share-based compensation.

We also incur expenses that are an integral component of, and are directly attributable to, our restructuring activities

which do not qualify as exit and disposal costs under U.S. GAAP, which consist of asset-related costs such as

intangible asset impairments and other asset related write-offs.

Personnel costs are primarily determined based on established benefit arrangements, local statutory requirements, or

historical benefit practices. We recognize these benefits when payment is probable and estimable. Other benefits

which require future service and are associated to non-recurring benefits are recognized ratably over the future

service period. Other assets, including inventory, are impaired or written-off if the carrying value exceeds the fair
value. All other costs are recognized as incurred.

In the second half of 2019, we decided to suspend development of NGS-related instrument systems and entered into
a new strategic partnership with Illumina to commercialize IVD kits worldwide on Illumina's diagnostic sequencers. In
order to align our business with this new strategy, we began restructuring initiatives to target resource allocation to
growth opportunities in our Sample to Insight portfolio.

Impairments to property, plant and equipment primarily impacted computer software and machinery and equipment.
Costs incurred to either purchase software or produce software products and the software components of products to
be sold, leased or marketed after technological feasibility is established were previously capitalized during the
development of certain NGS-related instrument systems. These long-lived assets were fully impaired due to the
decision to suspend further development. In addition to computer software, certain machinery and equipment assets
were fully impaired given that these assets had no alternative use following the changes announced for this program
and it was estimated that no value was recoverable in a market disposal.

Due to the suspended development, intangible assets were also assessed for recoverability. The abandoned assets
include developed technology related to the suspended projects as well as the termination of licenses which were
used exclusively in connection with this program. As a result, we recorded intangible asset impairment charges due
to the conclusion that the identified assets have no alternative use outside of the suspended program and thus are
fully impaired.

We also conducted an impairment review of inventory and prepaid and other assets and recorded the charges
noted in the table below. As these charges, including inventory, are a direct result of the decision to suspend further
development of NGS-related instrument systems and are not related to external market factors, the impairment
charges were recorded in the line item restructuring, acquisition, integration and other, net in the consolidated
statements of (loss) income due to the assets being deemed excess and no longer utilized due to the discontinued
development and related actions discussed above.

In addition, we have initiated measures to:

›

shift Commercial Operations activities into Business Areas;

›

transition manufacturing activities into a regional structure; and

›

expand the scope of activities at QIAGEN Business Services (QBS) centers in Wroclaw, Poland and Manila,
Philippines

The following is a summary of the charges recorded during the year ended December 31, 2019.

Personnel related (of which $2,956 due to related parties)

(22)

$ 70,578

Contract termination costs (of which $15,676 due to related parties)

Consulting fees

Accounts receivable (of which $5,984 due from related parties)

Inventories

Prepaid expenses and other assets (of which $12,915 was long-term and $2,270 due from related parties)

Property, plant and equipment

Intangible assets

162

Equity method investment impairment

Total

42,099

10,150

10,825

12,336

17,012

163,000

98,472

40,301

138,773

4,799

$ 306,572

(9)

(11)

(10)

Of the total costs incurred, $60.2 million are accrued as of December 31, 2019 in accrued and other current

liabilities in the accompanying consolidated balance sheet as summarized in the following table that includes the

cash components of the restructuring activity.

Costs incurred in 2019

Payments

$ 44,640

$ 42,099

$ 10,150

$ 96,889

(17,272)

(18,294)

(2,162)

(37,728)

Foreign currency translation adjustment

631

493

(53)

1,071

$ 27,999

$ 24,298

$ 7,935

$ 60,232

Consolidated Statement of (Loss) Income Classification and Type of Charge (in thousands)Year endedDecember 31, 2019NoteTotalRestructuring, acquisition, integration and other, netLong-lived asset impairmentsOther (expense) income, net(in thousands)PersonnelRelatedContract TerminationConsultingFeesTotalLiability at December 31, 20192019 Asset AcquisitionDivestitures2019 Restructuring 
We also conducted an impairment review of inventory and prepaid and other assets and recorded the charges

We also conducted an impairment review of inventory and prepaid and other assets and recorded the charges

We also conducted an impairment review of inventory and prepaid and other assets and recorded the charges

We also conducted an impairment review of inventory and prepaid and other assets and recorded the charges

We also conducted an impairment review of inventory and prepaid and other assets and recorded the charges

We also conducted an impairment review of inventory and prepaid and other assets and recorded the charges

We also conducted an impairment review of inventory and prepaid and other assets and recorded the charges

We also conducted an impairment review of inventory and prepaid and other assets and recorded the charges

We also conducted an impairment review of inventory and prepaid and other assets and recorded the charges

We also conducted an impairment review of inventory and prepaid and other assets and recorded the charges

We also conducted an impairment review of inventory and prepaid and other assets and recorded the charges

noted in the table below. As these charges, including inventory, are a direct result of the decision to suspend further

noted in the table below. As these charges, including inventory, are a direct result of the decision to suspend further

noted in the table below. As these charges, including inventory, are a direct result of the decision to suspend further

noted in the table below. As these charges, including inventory, are a direct result of the decision to suspend further

noted in the table below. As these charges, including inventory, are a direct result of the decision to suspend further

noted in the table below. As these charges, including inventory, are a direct result of the decision to suspend further

noted in the table below. As these charges, including inventory, are a direct result of the decision to suspend further

noted in the table below. As these charges, including inventory, are a direct result of the decision to suspend further

noted in the table below. As these charges, including inventory, are a direct result of the decision to suspend further

noted in the table below. As these charges, including inventory, are a direct result of the decision to suspend further

noted in the table below. As these charges, including inventory, are a direct result of the decision to suspend further

development of NGS-related instrument systems and are not related to external market factors, the impairment

development of NGS-related instrument systems and are not related to external market factors, the impairment

development of NGS-related instrument systems and are not related to external market factors, the impairment

development of NGS-related instrument systems and are not related to external market factors, the impairment

development of NGS-related instrument systems and are not related to external market factors, the impairment

development of NGS-related instrument systems and are not related to external market factors, the impairment

development of NGS-related instrument systems and are not related to external market factors, the impairment

development of NGS-related instrument systems and are not related to external market factors, the impairment

development of NGS-related instrument systems and are not related to external market factors, the impairment

development of NGS-related instrument systems and are not related to external market factors, the impairment

development of NGS-related instrument systems and are not related to external market factors, the impairment

charges were recorded in the line item restructuring, acquisition, integration and other, net in the consolidated

charges were recorded in the line item restructuring, acquisition, integration and other, net in the consolidated

charges were recorded in the line item restructuring, acquisition, integration and other, net in the consolidated

charges were recorded in the line item restructuring, acquisition, integration and other, net in the consolidated

charges were recorded in the line item restructuring, acquisition, integration and other, net in the consolidated

charges were recorded in the line item restructuring, acquisition, integration and other, net in the consolidated

charges were recorded in the line item restructuring, acquisition, integration and other, net in the consolidated

charges were recorded in the line item restructuring, acquisition, integration and other, net in the consolidated

charges were recorded in the line item restructuring, acquisition, integration and other, net in the consolidated

charges were recorded in the line item restructuring, acquisition, integration and other, net in the consolidated

charges were recorded in the line item restructuring, acquisition, integration and other, net in the consolidated

statements of (loss) income due to the assets being deemed excess and no longer utilized due to the discontinued

statements of (loss) income due to the assets being deemed excess and no longer utilized due to the discontinued

statements of (loss) income due to the assets being deemed excess and no longer utilized due to the discontinued

statements of (loss) income due to the assets being deemed excess and no longer utilized due to the discontinued

statements of (loss) income due to the assets being deemed excess and no longer utilized due to the discontinued

statements of (loss) income due to the assets being deemed excess and no longer utilized due to the discontinued

statements of (loss) income due to the assets being deemed excess and no longer utilized due to the discontinued

statements of (loss) income due to the assets being deemed excess and no longer utilized due to the discontinued

statements of (loss) income due to the assets being deemed excess and no longer utilized due to the discontinued

statements of (loss) income due to the assets being deemed excess and no longer utilized due to the discontinued

statements of (loss) income due to the assets being deemed excess and no longer utilized due to the discontinued

development and related actions discussed above.

development and related actions discussed above.

development and related actions discussed above.

development and related actions discussed above.

development and related actions discussed above.

development and related actions discussed above.

development and related actions discussed above.

development and related actions discussed above.

development and related actions discussed above.

development and related actions discussed above.

development and related actions discussed above.

In addition, we have initiated measures to:
In addition, we have initiated measures to:
In addition, we have initiated measures to:
In addition, we have initiated measures to:
In addition, we have initiated measures to:
In addition, we have initiated measures to:
In addition, we have initiated measures to:

In addition, we have initiated measures to:
In addition, we have initiated measures to:
In addition, we have initiated measures to:
In addition, we have initiated measures to:
F I N A N C I A L   R E S U LT S Notes to consolidated financial statements

›

›

›

›

›

›

shift Commercial Operations activities into Business Areas;
shift Commercial Operations activities into Business Areas;

shift Commercial Operations activities into Business Areas;
shift Commercial Operations activities into Business Areas;
shift Commercial Operations activities into Business Areas;
shift Commercial Operations activities into Business Areas;
shift Commercial Operations activities into Business Areas;
shift Commercial Operations activities into Business Areas;
shift Commercial Operations activities into Business Areas;

shift Commercial Operations activities into Business Areas;
shift Commercial Operations activities into Business Areas;

›

›

›

›

›

›

›

›

›

transition manufacturing activities into a regional structure; and
transition manufacturing activities into a regional structure; and

transition manufacturing activities into a regional structure; and
transition manufacturing activities into a regional structure; and
transition manufacturing activities into a regional structure; and
transition manufacturing activities into a regional structure; and
transition manufacturing activities into a regional structure; and
transition manufacturing activities into a regional structure; and
transition manufacturing activities into a regional structure; and

transition manufacturing activities into a regional structure; and
transition manufacturing activities into a regional structure; and

›

›

›

›

›

›

›

›

›

›

›

›

›

›

›

›

›

›

expand the scope of activities at QIAGEN Business Services (QBS) centers in Wroclaw, Poland and Manila,
expand the scope of activities at QIAGEN Business Services (QBS) centers in Wroclaw, Poland and Manila,
Philippines
Philippines

expand the scope of activities at QIAGEN Business Services (QBS) centers in Wroclaw, Poland and Manila,
expand the scope of activities at QIAGEN Business Services (QBS) centers in Wroclaw, Poland and Manila,
expand the scope of activities at QIAGEN Business Services (QBS) centers in Wroclaw, Poland and Manila,
expand the scope of activities at QIAGEN Business Services (QBS) centers in Wroclaw, Poland and Manila,
expand the scope of activities at QIAGEN Business Services (QBS) centers in Wroclaw, Poland and Manila,
expand the scope of activities at QIAGEN Business Services (QBS) centers in Wroclaw, Poland and Manila,
expand the scope of activities at QIAGEN Business Services (QBS) centers in Wroclaw, Poland and Manila,
Philippines
Philippines
Philippines
Philippines
Philippines
Philippines
Philippines

expand the scope of activities at QIAGEN Business Services (QBS) centers in Wroclaw, Poland and Manila,
expand the scope of activities at QIAGEN Business Services (QBS) centers in Wroclaw, Poland and Manila,
Philippines
Philippines

The following is a summary of the charges recorded during the year ended December 31, 2019.
The following is a summary of the charges recorded during the year ended December 31, 2019.

The following is a summary of the charges recorded during the year ended December 31, 2019.
The following is a summary of the charges recorded during the year ended December 31, 2019.
The following is a summary of the charges recorded during the year ended December 31, 2019.
The following is a summary of the charges recorded during the year ended December 31, 2019.
The following is a summary of the charges recorded during the year ended December 31, 2019.
The following is a summary of the charges recorded during the year ended December 31, 2019.
The following is a summary of the charges recorded during the year ended December 31, 2019.

The following is a summary of the charges recorded during the year ended December 31, 2019.
The following is a summary of the charges recorded during the year ended December 31, 2019.

Personnel related (of which $2,956 due to related parties)
Personnel related (of which $2,956 due to related parties)

Personnel related (of which $2,956 due to related parties)
Personnel related (of which $2,956 due to related parties)
Personnel related (of which $2,956 due to related parties)
Personnel related (of which $2,956 due to related parties)
Personnel related (of which $2,956 due to related parties)
Personnel related (of which $2,956 due to related parties)
Personnel related (of which $2,956 due to related parties)

Personnel related (of which $2,956 due to related parties)
Personnel related (of which $2,956 due to related parties)

Contract termination costs (of which $15,676 due to related parties)
Contract termination costs (of which $15,676 due to related parties)

Contract termination costs (of which $15,676 due to related parties)
Contract termination costs (of which $15,676 due to related parties)
Contract termination costs (of which $15,676 due to related parties)
Contract termination costs (of which $15,676 due to related parties)
Contract termination costs (of which $15,676 due to related parties)
Contract termination costs (of which $15,676 due to related parties)
Contract termination costs (of which $15,676 due to related parties)

Contract termination costs (of which $15,676 due to related parties)
Contract termination costs (of which $15,676 due to related parties)

Consulting fees
Consulting fees

Consulting fees
Consulting fees
Consulting fees
Consulting fees
Consulting fees
Consulting fees
Consulting fees

Consulting fees
Consulting fees

Accounts receivable (of which $5,984 due from related parties)
Accounts receivable (of which $5,984 due from related parties)

Accounts receivable (of which $5,984 due from related parties)
Accounts receivable (of which $5,984 due from related parties)
Accounts receivable (of which $5,984 due from related parties)
Accounts receivable (of which $5,984 due from related parties)
Accounts receivable (of which $5,984 due from related parties)
Accounts receivable (of which $5,984 due from related parties)
Accounts receivable (of which $5,984 due from related parties)

Accounts receivable (of which $5,984 due from related parties)
Accounts receivable (of which $5,984 due from related parties)

Inventories
Inventories

Inventories
Inventories
Inventories
Inventories
Inventories
Inventories
Inventories

Inventories
Inventories

Prepaid expenses and other assets (of which $12,915 was long-term and $2,270 due from related parties)
Prepaid expenses and other assets (of which $12,915 was long-term and $2,270 due from related parties)

Prepaid expenses and other assets (of which $12,915 was long-term and $2,270 due from related parties)
Prepaid expenses and other assets (of which $12,915 was long-term and $2,270 due from related parties)
Prepaid expenses and other assets (of which $12,915 was long-term and $2,270 due from related parties)
Prepaid expenses and other assets (of which $12,915 was long-term and $2,270 due from related parties)
Prepaid expenses and other assets (of which $12,915 was long-term and $2,270 due from related parties)
Prepaid expenses and other assets (of which $12,915 was long-term and $2,270 due from related parties)
Prepaid expenses and other assets (of which $12,915 was long-term and $2,270 due from related parties)

Prepaid expenses and other assets (of which $12,915 was long-term and $2,270 due from related parties)
Prepaid expenses and other assets (of which $12,915 was long-term and $2,270 due from related parties)

Property, plant and equipment
Property, plant and equipment

Property, plant and equipment
Property, plant and equipment
Property, plant and equipment
Property, plant and equipment
Property, plant and equipment
Property, plant and equipment
Property, plant and equipment

Property, plant and equipment
Property, plant and equipment

Intangible assets
Intangible assets

Intangible assets
Intangible assets
Intangible assets
Intangible assets
Intangible assets
Intangible assets
Intangible assets

Intangible assets
Intangible assets

Equity method investment impairment
Equity method investment impairment

Equity method investment impairment
Equity method investment impairment
Equity method investment impairment
Equity method investment impairment
Equity method investment impairment
Equity method investment impairment
Equity method investment impairment

Equity method investment impairment
Equity method investment impairment

Total
Total

Total
Total
Total
Total
Total
Total
Total

Total
Total

(22)
(22)

(22)
(22)
(22)
(22)
(22)
(22)
(22)

(22)
(22)

(9)
(9)

(9)
(9)
(9)
(9)
(9)
(9)
(9)

(9)
(9)

(11)
(11)

(11)
(11)
(11)
(11)
(11)
(11)
(11)

(11)
(11)

(10)
(10)

(10)
(10)
(10)
(10)
(10)
(10)
(10)

(10)
(10)

$ 70,578
$ 70,578

$ 70,578
$ 70,578
$ 70,578
$ 70,578
$ 70,578
$ 70,578
$ 70,578

$ 70,578
$ 70,578

42,099
42,099

42,099
42,099
42,099
42,099
42,099
42,099
42,099

42,099
42,099

10,150
10,150

10,150
10,150
10,150
10,150
10,150
10,150
10,150

10,150
10,150

10,825
10,825

10,825
10,825
10,825
10,825
10,825
10,825
10,825

10,825
10,825

12,336
12,336

12,336
12,336
12,336
12,336
12,336
12,336
12,336

12,336
12,336

17,012
17,012

17,012
17,012
17,012
17,012
17,012
17,012
17,012

17,012
17,012

163,000
163,000

163,000
163,000
163,000
163,000
163,000
163,000
163,000

163,000
163,000

98,472
98,472

98,472
98,472
98,472
98,472
98,472
98,472
98,472

98,472
98,472

40,301
40,301

40,301
40,301
40,301
40,301
40,301
40,301
40,301

40,301
40,301

138,773
138,773

138,773
138,773
138,773
138,773
138,773
138,773
138,773

138,773
138,773

4,799
4,799

4,799
4,799
4,799
4,799
4,799
4,799
4,799

4,799
4,799

$ 306,572
$ 306,572

$ 306,572
$ 306,572
$ 306,572
$ 306,572
$ 306,572
$ 306,572
$ 306,572

$ 306,572
$ 306,572

Of the total costs incurred, $60.2 million are accrued as of December 31, 2019 in accrued and other current
Of the total costs incurred, $60.2 million are accrued as of December 31, 2019 in accrued and other current
Of the total costs incurred, $60.2 million are accrued as of December 31, 2019 in accrued and other current
Of the total costs incurred, $60.2 million are accrued as of December 31, 2019 in accrued and other current
Of the total costs incurred, $60.2 million are accrued as of December 31, 2019 in accrued and other current
Of the total costs incurred, $60.2 million are accrued as of December 31, 2019 in accrued and other current
Of the total costs incurred, $60.2 million are accrued as of December 31, 2019 in accrued and other current
Of the total costs incurred, $60.2 million are accrued as of December 31, 2019 in accrued and other current
Of the total costs incurred, $60.2 million are accrued as of December 31, 2019 in accrued and other current
Of the total costs incurred, $60.2 million are accrued as of December 31, 2019 in accrued and other current
Of the total costs incurred, $60.2 million are accrued as of December 31, 2019 in accrued and other current
liabilities in the accompanying consolidated balance sheet as summarized in the following table that includes the
liabilities in the accompanying consolidated balance sheet as summarized in the following table that includes the
liabilities in the accompanying consolidated balance sheet as summarized in the following table that includes the
liabilities in the accompanying consolidated balance sheet as summarized in the following table that includes the
liabilities in the accompanying consolidated balance sheet as summarized in the following table that includes the
liabilities in the accompanying consolidated balance sheet as summarized in the following table that includes the
liabilities in the accompanying consolidated balance sheet as summarized in the following table that includes the
liabilities in the accompanying consolidated balance sheet as summarized in the following table that includes the
liabilities in the accompanying consolidated balance sheet as summarized in the following table that includes the
liabilities in the accompanying consolidated balance sheet as summarized in the following table that includes the
liabilities in the accompanying consolidated balance sheet as summarized in the following table that includes the
cash components of the restructuring activity.
cash components of the restructuring activity.
cash components of the restructuring activity.
cash components of the restructuring activity.
cash components of the restructuring activity.
cash components of the restructuring activity.
cash components of the restructuring activity.
cash components of the restructuring activity.
cash components of the restructuring activity.
cash components of the restructuring activity.
cash components of the restructuring activity.

Costs incurred in 2019
Costs incurred in 2019

Costs incurred in 2019
Costs incurred in 2019
Costs incurred in 2019
Costs incurred in 2019
Costs incurred in 2019
Costs incurred in 2019
Costs incurred in 2019

Costs incurred in 2019
Costs incurred in 2019

$ 44,640
$ 44,640

$ 44,640
$ 44,640
$ 44,640
$ 44,640
$ 44,640
$ 44,640
$ 44,640

$ 44,640
$ 44,640

$ 42,099
$ 42,099

$ 42,099
$ 42,099
$ 42,099
$ 42,099
$ 42,099
$ 42,099
$ 42,099

$ 42,099
$ 42,099

$ 10,150
$ 10,150

$ 10,150
$ 10,150
$ 10,150
$ 10,150
$ 10,150
$ 10,150
$ 10,150

$ 10,150
$ 10,150

$ 96,889
$ 96,889

$ 96,889
$ 96,889
$ 96,889
$ 96,889
$ 96,889
$ 96,889
$ 96,889

$ 96,889
$ 96,889

Payments
Payments

Payments
Payments
Payments
Payments
Payments
Payments
Payments

Payments
Payments

Foreign currency translation adjustment
Foreign currency translation adjustment

Foreign currency translation adjustment
Foreign currency translation adjustment
Foreign currency translation adjustment
Foreign currency translation adjustment
Foreign currency translation adjustment
Foreign currency translation adjustment
Foreign currency translation adjustment

Foreign currency translation adjustment
Foreign currency translation adjustment

(17,272)
(17,272)

(17,272)
(17,272)
(17,272)
(17,272)
(17,272)
(17,272)
(17,272)

(17,272)
(17,272)

(18,294)
(18,294)

(18,294)
(18,294)
(18,294)
(18,294)
(18,294)
(18,294)
(18,294)

(18,294)
(18,294)

(2,162)
(2,162)

(2,162)
(2,162)
(2,162)
(2,162)
(2,162)
(2,162)
(2,162)

(2,162)
(2,162)

(37,728)
(37,728)

(37,728)
(37,728)
(37,728)
(37,728)
(37,728)
(37,728)
(37,728)

(37,728)
(37,728)

631
631

631
631
631
631
631
631
631

631
631

493
493

493
493
493
493
493
493
493

493
493

(53)
(53)

(53)
(53)
(53)
(53)
(53)
(53)
(53)

(53)
(53)

1,071
1,071

1,071
1,071
1,071
1,071
1,071
1,071
1,071

1,071
1,071

$ 27,999
$ 27,999

$ 27,999
$ 27,999
$ 27,999
$ 27,999
$ 27,999
$ 27,999
$ 27,999

$ 27,999
$ 27,999

$ 24,298
$ 24,298

$ 24,298
$ 24,298
$ 24,298
$ 24,298
$ 24,298
$ 24,298
$ 24,298

$ 24,298
$ 24,298

$ 7,935
$ 7,935

$ 7,935
$ 7,935
$ 7,935
$ 7,935
$ 7,935
$ 7,935
$ 7,935

$ 7,935
$ 7,935

$ 60,232
$ 60,232

$ 60,232
$ 60,232
$ 60,232
$ 60,232
$ 60,232
$ 60,232
$ 60,232

$ 60,232
$ 60,232

Future pre-tax costs between $15 - $23 million are expected to be incurred primarily related to personnel, consulting
and contract termination costs before completion of the program in 2020.

We initiated restructuring initiatives in 2017 to mitigate the negative impacts stemming from the U.S. tax reform.
Total pre-tax costs for the initiatives, which were concluded in 2018, were $24 million and no additional costs will
be incurred related to this program. Cumulative costs for this program were as follows:

The following table summarizes the cash components of the restructuring activity.

$ 9,705

$ 10,008

$ 4,649

$ 24,362

Restructuring, acquisition, integration and other, net

Cost of sales

Cost of sales

Restructuring, acquisition, integration and other, net

Restructuring, acquisition, integration and other, net

Total 2019 releases

$ —

6,174

6,174

424

4,207

4,631

(1,100)

(1,100)

Liability at December 31, 2017

Additional costs in 2018

Release of excess accrual

Payments

Foreign currency translation adjustment

Release of excess accrual

Payments

Foreign currency translation adjustment

163

$ 3,039

$ 3,039

3,039

1,610

1,610

—

—

—

—

10,757

13,796

1,617

10,049

11,666

(1,100)

(1,100)

$ —

4,583

4,583

1,193

4,232

5,425

—

—

6,468

(1,837)

(6,892)

(141)

(1,100)

(2,269)

(49)

$ 402

$ 6,222

$ 4,585

$ 10,807

$ 3,820

$ 2,844

$ 6,664

5,554

(129)

12,022

(1,966)

(7,149)

(14,041)

(17)

(158)

—

(2,828)

(16)

$ —

(1,100)

(5,097)

(65)

$ 402

During 2018, fixed asset impairments of $1.6 million were recorded in connection with this initiative and are

included within restructuring, acquisition, integration and other, net in the accompanying consolidated statements of

income. As of December 31, 2019 and 2018, liabilities of $0.4 million and $6.7 million, respectively, are included

in accrued and other current liabilities in the accompanying consolidated balance sheets.

During 2016, we initiated a series of targeted actions to support faster sales momentum and improve efficiency and

accountability. The objective with these actions is to ensure that we grow sustainably and consistently. Measures

included simplifying our geographic presence with site reductions, focusing resources to shared service centers, and

streamlining selected organizational structures. The cumulative cost for this program was $97.1 million and no

additional costs will be incurred related to this program. During the year ended December 31, 2017, we incurred

$19.7 million of costs, of which $1.4 million was included in cost of sales and $18.3 million was included in

restructuring, acquisition, integration and other, net. During the years ended December 31, 2019 and 2018,

Consolidated Statement of (Loss) Income Classification and Type of Charge (in thousands)Year endedDecember 31, 2019NoteTotalRestructuring, acquisition, integration and other, netLong-lived asset impairmentsOther (expense) income, net(in thousands)PersonnelRelatedContract TerminationConsultingFeesTotalLiability at December 31, 20192017 Restructuring2016 Restructuring(in thousands)PersonnelRelatedContract andOther CostsInventory Write-offs & AssetImpairmentsTotalTotal 2017 costsTotal 2018 costsTotal cumulative costs(in thousands)PersonnelRelatedConsulting CostsTotalLiability at December 31, 2018Liability at December 31, 2019Consolidated Statement of (Loss) Income Classification and Type of Charge (in thousands)Year endedDecember 31, 2019NoteTotalRestructuring, acquisition, integration and other, netLong-lived asset impairmentsOther (expense) income, net(in thousands)PersonnelRelatedContract TerminationConsultingFeesTotalLiability at December 31, 2019Consolidated Statement of (Loss) Income Classification and Type of Charge (in thousands)Year endedDecember 31, 2019NoteTotalRestructuring, acquisition, integration and other, netLong-lived asset impairmentsOther (expense) income, net(in thousands)PersonnelRelatedContract TerminationConsultingFeesTotalLiability at December 31, 2019Consolidated Statement of (Loss) Income Classification and Type of Charge (in thousands)Year endedDecember 31, 2019NoteTotalRestructuring, acquisition, integration and other, netLong-lived asset impairmentsOther (expense) income, net(in thousands)PersonnelRelatedContract TerminationConsultingFeesTotalLiability at December 31, 2019Consolidated Statement of (Loss) Income Classification and Type of Charge (in thousands)Year endedDecember 31, 2019NoteTotalRestructuring, acquisition, integration and other, netLong-lived asset impairmentsOther (expense) income, net(in thousands)PersonnelRelatedContract TerminationConsultingFeesTotalLiability at December 31, 2019Consolidated Statement of (Loss) Income Classification and Type of Charge (in thousands)Year endedDecember 31, 2019NoteTotalRestructuring, acquisition, integration and other, netLong-lived asset impairmentsOther (expense) income, net(in thousands)PersonnelRelatedContract TerminationConsultingFeesTotalLiability at December 31, 2019Consolidated Statement of (Loss) Income Classification and Type of Charge (in thousands)Year endedDecember 31, 2019NoteTotalRestructuring, acquisition, integration and other, netLong-lived asset impairmentsOther (expense) income, net(in thousands)PersonnelRelatedContract TerminationConsultingFeesTotalLiability at December 31, 2019Consolidated Statement of (Loss) Income Classification and Type of Charge (in thousands)Year endedDecember 31, 2019NoteTotalRestructuring, acquisition, integration and other, netLong-lived asset impairmentsOther (expense) income, net(in thousands)PersonnelRelatedContract TerminationConsultingFeesTotalLiability at December 31, 2019Consolidated Statement of (Loss) Income Classification and Type of Charge (in thousands)Year endedDecember 31, 2019NoteTotalRestructuring, acquisition, integration and other, netLong-lived asset impairmentsOther (expense) income, net(in thousands)PersonnelRelatedContract TerminationConsultingFeesTotalLiability at December 31, 2019Consolidated Statement of (Loss) Income Classification and Type of Charge (in thousands)Year endedDecember 31, 2019NoteTotalRestructuring, acquisition, integration and other, netLong-lived asset impairmentsOther (expense) income, net(in thousands)PersonnelRelatedContract TerminationConsultingFeesTotalLiability at December 31, 2019Consolidated Statement of (Loss) Income Classification and Type of Charge (in thousands)Year endedDecember 31, 2019NoteTotalRestructuring, acquisition, integration and other, netLong-lived asset impairmentsOther (expense) income, net(in thousands)PersonnelRelatedContract TerminationConsultingFeesTotalLiability at December 31, 2019 
 
 
 
 
 
 
 
 
 
 
Future pre-tax costs between $15 - $23 million are expected to be incurred primarily related to personnel, consulting
and contract termination costs before completion of the program in 2020.

We initiated restructuring initiatives in 2017 to mitigate the negative impacts stemming from the U.S. tax reform.
Total pre-tax costs for the initiatives, which were concluded in 2018, were $24 million and no additional costs will
be incurred related to this program. Cumulative costs for this program were as follows:

Cost of sales

Restructuring, acquisition, integration and other, net

Cost of sales

Restructuring, acquisition, integration and other, net

Restructuring, acquisition, integration and other, net

Total 2019 releases

$ —

6,174

6,174

424

4,207

4,631

(1,100)

(1,100)

$ —

4,583

4,583

1,193

4,232

5,425

—

—

$ 3,039

$ 3,039

—

3,039

—

1,610

1,610

—

—

10,757

13,796

1,617

10,049

11,666

(1,100)

(1,100)

$ 9,705

$ 10,008

$ 4,649

$ 24,362

The following table summarizes the cash components of the restructuring activity.

Liability at December 31, 2017

Additional costs in 2018

Release of excess accrual

Payments

Foreign currency translation adjustment

Release of excess accrual

Payments

Foreign currency translation adjustment

$ 6,222

$ 4,585

$ 10,807

6,468

(1,837)

(6,892)

(141)

5,554

(129)

12,022

(1,966)

(7,149)

(14,041)

(17)

(158)

$ 3,820

$ 2,844

$ 6,664

(1,100)

(2,269)

(49)

$ 402

—

(2,828)

(16)

$ —

(1,100)

(5,097)

(65)

$ 402

During 2018, fixed asset impairments of $1.6 million were recorded in connection with this initiative and are
included within restructuring, acquisition, integration and other, net in the accompanying consolidated statements of
income. As of December 31, 2019 and 2018, liabilities of $0.4 million and $6.7 million, respectively, are included
in accrued and other current liabilities in the accompanying consolidated balance sheets.

During 2016, we initiated a series of targeted actions to support faster sales momentum and improve efficiency and
accountability. The objective with these actions is to ensure that we grow sustainably and consistently. Measures
included simplifying our geographic presence with site reductions, focusing resources to shared service centers, and
streamlining selected organizational structures. The cumulative cost for this program was $97.1 million and no
additional costs will be incurred related to this program. During the year ended December 31, 2017, we incurred
$19.7 million of costs, of which $1.4 million was included in cost of sales and $18.3 million was included in
restructuring, acquisition, integration and other, net. During the years ended December 31, 2019 and 2018,
164

2017 Restructuring2016 Restructuring(in thousands)PersonnelRelatedContract andOther CostsInventory Write-offs & AssetImpairmentsTotalTotal 2017 costsTotal 2018 costsTotal cumulative costs(in thousands)PersonnelRelatedConsulting CostsTotalLiability at December 31, 2018Liability at December 31, 2019releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and

other, net.

The following table summarizes the cash components of the restructuring activity.

Liability at December 31, 2017

Release of excess accrual

Payments

Foreign currency translation adjustment

Release of excess accrual

Payments

Foreign currency translation adjustment

$ 4,294

$ 1,052

(343)

(3,648)

(48)

$ 255

(31)

(225)

1

$ —

(838)

(214)

—

$ —

$ —

$ —

$ —

$ —

Future pre-tax costs between $15 - $23 million are expected to be incurred primarily related to personnel, consulting

and contract termination costs before completion of the program in 2020.

We initiated restructuring initiatives in 2017 to mitigate the negative impacts stemming from the U.S. tax reform.

Total pre-tax costs for the initiatives, which were concluded in 2018, were $24 million and no additional costs will

be incurred related to this program. Cumulative costs for this program were as follows:

The following table summarizes the cash components of the restructuring activity.

$ 9,705

$ 10,008

$ 4,649

$ 24,362

Restructuring, acquisition, integration and other, net

Cost of sales

Cost of sales

Restructuring, acquisition, integration and other, net

Restructuring, acquisition, integration and other, net

Total 2019 releases

Liability at December 31, 2017

Additional costs in 2018

Release of excess accrual

Payments

Foreign currency translation adjustment

Release of excess accrual

Payments

Foreign currency translation adjustment

F I N A N C I A L   R E S U LT S Notes to consolidated financial statements

$ —

6,174

6,174

424

4,207

4,631

(1,100)

(1,100)

$ —

4,583

4,583

1,193

4,232

5,425

—

—

6,468

(1,837)

(6,892)

(141)

(1,100)

(2,269)

(49)

$ 402

$ 3,039

$ 3,039

3,039

1,610

1,610

—

—

—

—

10,757

13,796

1,617

10,049

11,666

(1,100)

(1,100)

5,554

(129)

12,022

(1,966)

(7,149)

(14,041)

(17)

(158)

—

(2,828)

(16)

$ —

(1,100)

(5,097)

(65)

$ 402

$ 6,222

$ 4,585

$ 10,807

$ 3,820

$ 2,844

$ 6,664

During 2018, fixed asset impairments of $1.6 million were recorded in connection with this initiative and are
included within restructuring, acquisition, integration and other, net in the accompanying consolidated statements of
income. As of December 31, 2019 and 2018, liabilities of $0.4 million and $6.7 million, respectively, are included
in accrued and other current liabilities in the accompanying consolidated balance sheets.

During 2016, we initiated a series of targeted actions to support faster sales momentum and improve efficiency and
accountability. The objective with these actions is to ensure that we grow sustainably and consistently. Measures
included simplifying our geographic presence with site reductions, focusing resources to shared service centers, and
streamlining selected organizational structures. The cumulative cost for this program was $97.1 million and no
additional costs will be incurred related to this program. During the year ended December 31, 2017, we incurred
$19.7 million of costs, of which $1.4 million was included in cost of sales and $18.3 million was included in
restructuring, acquisition, integration and other, net. During the years ended December 31, 2019 and 2018,
releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and
releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and
other, net.
other, net.

releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and
releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and
other, net.
other, net.

releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and
releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and
other, net.
other, net.

The following table summarizes the cash components of the restructuring activity.
The following table summarizes the cash components of the restructuring activity.

The following table summarizes the cash components of the restructuring activity.
The following table summarizes the cash components of the restructuring activity.

The following table summarizes the cash components of the restructuring activity.
The following table summarizes the cash components of the restructuring activity.

Liability at December 31, 2017
Liability at December 31, 2017

Liability at December 31, 2017
Liability at December 31, 2017

Liability at December 31, 2017
Liability at December 31, 2017

Release of excess accrual
Release of excess accrual

Release of excess accrual
Release of excess accrual

Release of excess accrual
Release of excess accrual

Payments
Payments

Payments
Payments

Payments
Payments

Foreign currency translation adjustment
Foreign currency translation adjustment

Foreign currency translation adjustment
Foreign currency translation adjustment

Foreign currency translation adjustment
Foreign currency translation adjustment

Release of excess accrual
Release of excess accrual

Release of excess accrual
Release of excess accrual

Release of excess accrual
Release of excess accrual

Payments
Payments

Payments
Payments

Payments
Payments

$ 1,066

$ 6,412
$ 6,412

$ 1,066
$ 1,066

$ 4,294
$ 4,294

$ 1,052
$ 1,052

$ 6,412
$ 6,412

$ 4,294
$ 4,294

$ 1,052
$ 1,052

$ 1,066
$ 1,066

$ 6,412
$ 6,412

$ 1,066
$ 1,066

$ 1,052
$ 1,052

$ 4,294
$ 4,294

(343)
(343)

(343)
(343)

(343)
(343)

(3,648)
(3,648)

(3,648)
(3,648)

(3,648)
(3,648)

(838)
(838)

(838)
(546)
(838)

(1,727)
(1,727)

(1,727)
(1,727)

(1,727)
(1,727)

(838)
(838)

(546)
(546)

(546)
(546)

(546)
(546)

(214)
(214)

(214)
(494)
(214)

(4,356)
(4,356)

(4,356)
(4,356)

(4,356)
(4,356)

(214)
(214)

(494)
(494)

(494)
(494)

(494)
(494)

(48)
(48)

(48)
(48)

(48)
(48)

—
—

—
—

—
—

(26)

(74)
(74)

(26)
(26)

(26)
(26)

(74)
(74)

(74)
(74)

(26)
(26)

$ 255
$ 255

$ 255
$ 255

$ 255
$ 255

$ —
$ —

$ —
$ —

$ —
$ —

$ —

$ 255
$ 255

$ 255
$ 255

$ 255
$ 255

$ —
$ —

$ —
$ —

$ —
$ —

(31)
(31)

(31)
(31)

(31)
(31)

(225)
(225)

(225)
(225)

(225)
(225)

—
$ —
$ —
$ —

$ —
$ —

—
$ —
$ —
$ —

$ —
$ —

$ —

—
$ —
$ —
$ —

$ —
$ —

(31)
(31)

(31)
(31)

(31)
(31)

$ —

(225)
(225)

(225)
(225)

—
$ —
$ —
$ —

(225)
(225)

$ —
$ —

Foreign currency translation adjustment
Foreign currency translation adjustment

Foreign currency translation adjustment
Foreign currency translation adjustment

Foreign currency translation adjustment
Foreign currency translation adjustment

1
1

1
1

1
1

—
$ —
$ —
$ —

$ —
$ —

$ —

—
$ —
$ —
$ —

$ —
$ —

1
1

1
1

1
1

$ —
$ —

$ —
$ —

$ —
$ —

$ —
$ —

$ —
$ —

$ —
$ —

$ —

$ —
$ —

$ —
$ —

$ —
$ —

$ —
$ —

$ —
$ —

$ —
$ —

7. Short-Term Investments

7. Short-Term Investments
7. Short-Term Investments
7. Short-Term Investments
7. Short-Term Investments

7. Short-Term Investments
7. Short-Term Investments

At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million
($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables
due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial
assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market
value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets
as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is

At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million
At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million
At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million
At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million
At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million
At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million
($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables
($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables
($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables
($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables
($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables
($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables
due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial
due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial
due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial
due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial
due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial
due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial
assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market
assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market
assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market
assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market
assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market
assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market
value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets
value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets
value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets
value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets
value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets
value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets
as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is
as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is
as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is
as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is
as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is
as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is
determined using the effective interest rate method.
determined using the effective interest rate method.
determined using the effective interest rate method.
determined using the effective interest rate method.
determined using the effective interest rate method.
determined using the effective interest rate method.

determined using the effective interest rate method.

Money market deposits

Commercial paper

Loans receivable

Prepaid expenses

Other receivables

Value added tax

Cash collateral

8. Prepaid Expenses and Other Current Assets

8. Prepaid Expenses and Other Current Assets
8. Prepaid Expenses and Other Current Assets
8. Prepaid Expenses and Other Current Assets
8. Prepaid Expenses and Other Current Assets

8. Prepaid Expenses and Other Current Assets
8. Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:

Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:
Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:

Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:
Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:

Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:
Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:

165

$ 129,586

$ 129,586
$ 129,586

$ 129,586
$ 129,586

$ 129,586
$ 129,586

$ 234,256
$ 234,256

$ 234,256
$ 234,256

$ 234,256
$ 234,256

Prepaid expenses
Prepaid expenses

Prepaid expenses
Prepaid expenses

Prepaid expenses
Prepaid expenses

$ 45,409
$ 45,409
$ 45,409

$ 45,409
$ 45,409

$ 45,409
$ 45,409

$ 48,250
$ 48,250

$ 48,250
$ 48,250

$ 48,250
$ 48,250

9. Property, Plant and Equipment

Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as

Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as

Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as

Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as

Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as

Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as

Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as

follows as of December 31, 2019 and 2018:

9. Property, Plant and Equipment

9. Property, Plant and Equipment

9. Property, Plant and Equipment

9. Property, Plant and Equipment

9. Property, Plant and Equipment

9. Property, Plant and Equipment

follows as of December 31, 2019 and 2018:

follows as of December 31, 2019 and 2018:

follows as of December 31, 2019 and 2018:

follows as of December 31, 2019 and 2018:

follows as of December 31, 2019 and 2018:

follows as of December 31, 2019 and 2018:

(14)

Other receivables

Other receivables

Other receivables

Other receivables

Other receivables

Other receivables

Value added tax

Value added tax

Value added tax

Value added tax

Value added tax

Value added tax

Cash collateral

Cash collateral

Cash collateral

Cash collateral

Cash collateral

Cash collateral

37,025

37,025

37,025

37,025

37,025

37,025

37,025

11,127

11,127

11,127

11,127

11,127

11,127

20,347

20,347

20,347

20,347

20,347

20,347

20,347

24,416

24,416

24,416

24,416

24,416

24,416

2,683

2,683

2,683

2,683

2,683

2,683

2,683

(14)

(14)

(14)

(14)

(14)

(14)

25,368

25,368

25,368

25,368

25,368

25,368

$ 105,464

$ 105,464

$ 105,464

$ 105,464

$ 105,464

$ 105,464

$ 105,464

$ 109,161

$ 109,161

$ 109,161

$ 109,161

$ 109,161

$ 109,161

$ 109,161

Money market deposits
Money market deposits

Money market deposits
Money market deposits

Money market deposits
Money market deposits

Commercial paper
Commercial paper

Commercial paper
Commercial paper

Commercial paper
Commercial paper

Loans receivable
Loans receivable

Loans receivable
Loans receivable

Loans receivable
Loans receivable

$ 87,468

$ 87,468
$ 87,468

$ 87,468
$ 87,468

$ 87,468
$ 87,468

$ 20,000
$ 20,000

$ 20,000
$ 20,000

$ 20,000
$ 20,000

22,459

22,459
22,459

22,459
22,459

22,459
22,459

179,219
179,219

179,219
179,219

179,219
179,219

19,659

19,659
19,659

19,659
19,659

19,659
19,659

35,037
35,037

35,037
35,037

35,037
35,037

$ 6,412

(1,727)

(4,356)

(74)

$ 255

(31)

(225)

1

$ —

$ 20,000

179,219

35,037

$ 234,256

$ 48,250

11,127

24,416

25,368

2017 Restructuring2016 Restructuring(in thousands)PersonnelRelatedContract andOther CostsInventory Write-offs & AssetImpairmentsTotalTotal 2017 costsTotal 2018 costsTotal cumulative costs(in thousands)PersonnelRelatedConsulting CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assetsreleases of excess accruals as included in the table below were included in restructuring, acquisition, integration and

releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and

releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and

releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and

releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and

other, net.

other, net.

other, net.

other, net.

other, net.

The following table summarizes the cash components of the restructuring activity.

The following table summarizes the cash components of the restructuring activity.

The following table summarizes the cash components of the restructuring activity.

The following table summarizes the cash components of the restructuring activity.

The following table summarizes the cash components of the restructuring activity.

Liability at December 31, 2017

Release of excess accrual

Payments

Foreign currency translation adjustment

(48)

Foreign currency translation adjustment

Foreign currency translation adjustment

Foreign currency translation adjustment

Foreign currency translation adjustment

—

(48)

(48)

(48)

(48)

—

—

—

—

(26)

(26)

(26)

(26)

(26)

(74)

(74)

(74)

(74)

(74)

releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and

releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and

releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and

releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and

(31)

Release of excess accrual

Release of excess accrual

Release of excess accrual

Release of excess accrual

$ —

(31)

(31)

(31)

(31)

$ —

—

$ —

$ —

$ —

$ —

$ —

$ —

—

(31)

(31)

(31)

(31)

Release of excess accrual

other, net.

Payments

Foreign currency translation adjustment

(225)

Payments

Payments

other, net.

other, net.

other, net.

Payments

Payments

$ —

(225)

(225)

(225)

(225)

$ —

—

$ —

$ —

$ —

$ —

$ —

$ —

—

(225)

(225)

(225)

(225)

1

Foreign currency translation adjustment

Foreign currency translation adjustment

Foreign currency translation adjustment

Foreign currency translation adjustment

$ —

1

1

1

1

$ —

—

$ —

$ —

$ —

$ —

$ —

$ —

—

1

1

1

1

The following table summarizes the cash components of the restructuring activity.

The following table summarizes the cash components of the restructuring activity.

The following table summarizes the cash components of the restructuring activity.

The following table summarizes the cash components of the restructuring activity.

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

(31)

(225)

1

$ —

7. Short-Term Investments

7. Short-Term Investments

7. Short-Term Investments

7. Short-Term Investments

7. Short-Term Investments

At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million

At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million

At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million

At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million

At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million

($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables

($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables

($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables

($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables

($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables

$ 4,294

Liability at December 31, 2017

Liability at December 31, 2017

Liability at December 31, 2017

$ 1,052

$ 4,294

$ 4,294

$ 4,294

$ 1,052

$ 1,066

$ 1,066

$ 1,066

$ 1,052

$ 1,052

$ 1,066

$ 6,412

$ 6,412

$ 6,412

$ 6,412

Liability at December 31, 2017

due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial

due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial

due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial

due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial

due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial

Release of excess accrual

(1,727)

Release of excess accrual

Release of excess accrual

Release of excess accrual

(343)

(838)

(546)

(1,727)

(1,727)

(1,727)

(343)

(838)

(546)

(838)

(546)

(343)

(838)

(546)

(343)

assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market

assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market

assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market

assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market

assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market

(214)

(3,648)

(3,648)

(3,648)

(214)

(214)

(214)

(494)

(494)

(494)

(494)

(4,356)

(4,356)

(4,356)

(4,356)

(3,648)

Payments

Payments

Payments

Payments

value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets

value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets

value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets

value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets

value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets

Foreign currency translation adjustment

as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is

as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is

as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is

as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is

as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is

(48)

Foreign currency translation adjustment

Foreign currency translation adjustment

Foreign currency translation adjustment

—

(48)

(48)

(48)

—

—

—

(26)

(26)

(26)

(26)

(74)

(74)

(74)

(74)

determined using the effective interest rate method.

$ 255

determined using the effective interest rate method.

determined using the effective interest rate method.

determined using the effective interest rate method.

determined using the effective interest rate method.

$ —

$ 255

$ 255

$ 255

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ 255

$ 255

$ 255

$ 255

$ 4,294

Liability at December 31, 2017

Liability at December 31, 2017

Liability at December 31, 2017

Liability at December 31, 2017

$ 1,052

$ 4,294

$ 4,294

$ 4,294

$ 4,294

$ 1,052

$ 1,052

$ 1,066

$ 1,066

$ 1,066

$ 1,052

$ 1,052

$ 1,066

$ 1,066

$ 6,412

$ 6,412

$ 6,412

$ 6,412

$ 6,412

(343)

Release of excess accrual

Release of excess accrual

Release of excess accrual

Release of excess accrual

(838)

(343)

(343)

(343)

(343)

(838)

(838)

(838)

(838)

(546)

(546)

(546)

(546)

(546)

(1,727)

(1,727)

(1,727)

(1,727)

(1,727)

(3,648)

Payments

Payments

Payments

Payments

(214)

(3,648)

(3,648)

(3,648)

(3,648)

(214)

(214)

(214)

(214)

(494)

(494)

(494)

(494)

(494)

(4,356)

(4,356)

(4,356)

(4,356)

(4,356)

$ 255

$ —

$ 255

$ 255

$ 255

$ 255

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ 255

$ 255

$ 255

$ 255

$ 255

At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million
($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables
8. Prepaid Expenses and Other Current Assets
due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial
assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market
Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:
value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets
as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is

$ 234,256
$ 234,256
$ 234,256
$ 234,256
At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million
At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million
At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million
($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables
($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables
($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables
8. Prepaid Expenses and Other Current Assets
8. Prepaid Expenses and Other Current Assets
8. Prepaid Expenses and Other Current Assets
8. Prepaid Expenses and Other Current Assets
due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial
due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial
due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial
assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market
assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market
assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market
Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:
Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:
Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:
Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:
value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets
value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets
value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets
as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is
as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is
as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is
determined using the effective interest rate method.
determined using the effective interest rate method.
determined using the effective interest rate method.

$ 234,256

$ 129,586

$ 129,586
$ 129,586

$ 129,586
$ 129,586

9. Property, Plant and Equipment

8. Prepaid Expenses and Other Current Assets
Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as
Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:

9. Property, Plant and Equipment
9. Property, Plant and Equipment
9. Property, Plant and Equipment
9. Property, Plant and Equipment
8. Prepaid Expenses and Other Current Assets
8. Prepaid Expenses and Other Current Assets
8. Prepaid Expenses and Other Current Assets
Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as
Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as
Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as
Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as
follows as of December 31, 2019 and 2018:
follows as of December 31, 2019 and 2018:
follows as of December 31, 2019 and 2018:
follows as of December 31, 2019 and 2018:
Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:
Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:
Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:

follows as of December 31, 2019 and 2018:

Prepaid expenses
Prepaid expenses

Prepaid expenses
Prepaid expenses

Other receivables
Other receivables

Other receivables
Other receivables

Money market deposits
Money market deposits
Money market deposits
Value added tax
Value added tax
Value added tax
Value added tax

Commercial paper
Cash collateral
(14)
Cash collateral

Commercial paper
Commercial paper
Cash collateral
Cash collateral

Loans receivable

Loans receivable
Loans receivable

$ 45,409

$ 45,409
$ 45,409

$ 45,409
$ 45,409

37,025

37,025
37,025

37,025
37,025

$ 87,468
20,347

$ 87,468
20,347
20,347

$ 87,468
$ 87,468
20,347
20,347

(14)
(14)

22,459
2,683

22,459
2,683
2,683

22,459
22,459
2,683
2,683

(14)
(14)

19,659
$ 105,464

19,659
$ 105,464
$ 105,464

19,659
19,659
$ 105,464
$ 105,464

$ 129,586

$ 129,586

$ 129,586
$ 129,586

$ 48,250
$ 48,250

$ 48,250
$ 48,250

11,127
11,127

11,127
11,127

$ 20,000
24,416
24,416

$ 20,000
$ 20,000
24,416
24,416

179,219
25,368
25,368

179,219
179,219
25,368
25,368

$ 48,250

11,127

$ 20,000

24,416

179,219

25,368

35,037
$ 109,161
$ 109,161

35,037
35,037
$ 109,161
$ 109,161

$ 109,161

35,037

$ 234,256

$ 234,256
$ 234,256

$ 234,256

$ —

Money market deposits
Money market deposits

Money market deposits
Money market deposits

$ —

Commercial paper
Commercial paper

Commercial paper
Commercial paper

7. Short-Term Investments

7. Short-Term Investments
7. Short-Term Investments

Loans receivable
Loans receivable

Loans receivable
Loans receivable

$ 87,468
$ 87,468
$ 87,468
$ —
$ —
$ —
$ —

$ 87,468
$ 87,468

$ 20,000
$ 20,000
$ 20,000
$ 20,000
$ —
$ —
$ —

$ —
$ —

$ —
$ —

$ —

$ —

22,459

22,459
22,459

22,459
22,459

19,659

19,659
19,659

19,659
19,659

179,219
179,219

179,219
179,219

35,037
35,037

35,037
35,037

(31)

Release of excess accrual

Release of excess accrual
Release of excess accrual

(225)

Payments

Payments
Payments

1

Foreign currency translation adjustment

Foreign currency translation adjustment
Foreign currency translation adjustment

$ —

(31)

(31)
(31)

$ —

$ —
$ —

$ —
$ —
$ —
$ —

(31)

(31)
(31)

$ —

(225)

(225)
(225)

$ —

$ —
$ —

$ —
$ —
$ —
$ —

(225)

(225)
(225)

$ —

1

1
1

$ —

$ —
$ —

$ —
$ —
$ —
$ —

1

1
1

(31)

(225)

1

$ 20,000

$ —

179,219

35,037

Release of excess accrual

Payments

Foreign currency translation adjustment

Money market deposits

Commercial paper

7. Short-Term Investments

Loans receivable

determined using the effective interest rate method.

Prepaid expenses

Other receivables

Money market deposits

Value added tax

Commercial paper

Cash collateral

Loans receivable

Prepaid expenses

Other receivables

Value added tax

Cash collateral

follows as of December 31, 2019 and 2018:

9. Property, Plant and Equipment

9. Property, Plant and Equipment

9. Property, Plant and Equipment
9. Property, Plant and Equipment

Furniture and office equipment

Furniture and office equipment

Furniture and office equipment

Construction in progress

Construction in progress

Construction in progress

Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as

Less: Accumulated depreciation and amortization

Less: Accumulated depreciation and amortization

Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as
follows as of December 31, 2019 and 2018:

Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as
Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as
Less: Accumulated depreciation and amortization
(603,430)
(603,430)
follows as of December 31, 2019 and 2018:
follows as of December 31, 2019 and 2018:
Property, plant and equipment, net

Property, plant and equipment, net

Property, plant and equipment, net

$ 455,243

$ 455,243

$ 511,659

$ 511,659

$ 455,243

$ 511,659

(699,130)

(699,130)

(699,130)

(603,430)

Amortization of assets acquired under capital lease obligations is included within accumulated depreciation and
Amortization of assets acquired under capital lease obligations is included within accumulated depreciation and
Amortization of assets acquired under capital lease obligations is included within accumulated depreciation and
amortization above for the years ended December 31, 2019 and 2018, respectively.Amortization of assets
amortization above for the years ended December 31, 2019 and 2018, respectively.Amortization of assets
amortization above for the years ended December 31, 2019 and 2018, respectively.Amortization of assets
acquired under capital lease obligations is included within accumulated depreciation and amortization above for the
acquired under capital lease obligations is included within accumulated depreciation and amortization above for the
acquired under capital lease obligations is included within accumulated depreciation and amortization above for the
years ended December 31, 2019 and 2018, respectively.
years ended December 31, 2019 and 2018, respectively.
years ended December 31, 2019 and 2018, respectively.

We recorded asset impairment charges as follows below for the years ended December 31, 2019 and 2018.

We recorded asset impairment charges as follows below for the years ended December 31, 2019 and 2018.

We recorded asset impairment charges as follows below for the years ended December 31, 2019 and 2018.

Buildings and improvements
Other receivables

Buildings and improvements
Other receivables
Other receivables

Buildings and improvements

Machinery and equipment
Value added tax

Machinery and equipment
Value added tax
Value added tax

Machinery and equipment

341,032
37,025

341,032
341,032
37,025

37,025
37,025

5-40

5-40

5-40

292,294
20,347

292,294
292,294
20,347

20,347
20,347

3-10

3-10

3-10

Computer software
Computer software
Computer software
Cash collateral
(14)
Cash collateral
Cash collateral

(14)

3-7
3-7
301,604
2,683
(14)
(14)

301,604
301,604
2,683

2,683
2,683

3-7

$ 48,250

11,127

24,416

25,368

$ 109,161

$ 17,938
$ 48,250

$ 17,938

$ 17,938

$ 48,250
$ 48,250

322,751
322,751
11,127

322,751

11,127
11,127

306,750
306,750
24,416

306,750

24,416
24,416

277,006
277,006
25,368

277,006

25,368
25,368

98,858

98,858

98,858

80,874

80,874

80,874

1,154,373

1,154,373

1,154,373

1,115,089

1,115,089

1,115,089

102,901
3-10
3-10
$ 105,464
$ 105,464
$ 105,464

102,901
$ 105,464

102,901

3-10

109,770
$ 109,161

109,770

109,770
$ 109,161
$ 109,161

$ 17,684
—
$ 45,409

$ 17,684
$ 45,409

$ 17,684

$ 45,409
$ 45,409

Land
Prepaid expenses

Prepaid expenses
Prepaid expenses

Land

Land

—

—

—

—

—

Machinery and equipment

Machinery and equipment

Machinery and equipment

Computer software

Computer software

Computer software

Furniture and office equipment

Furniture and office equipment

Furniture and office equipment

Construction in progress

Construction in progress

Construction in progress

$ 9,177

$ 9,177

$ 9,177

44,649

44,649

44,649

4,030

4,030

4,030

41,870

41,870

41,870

$ —

$ —

$ —

2,911

2,911

2,911

—

—

—

4,979

4,979

4,979

$ 99,726

$ 99,726

$ 99,726

$ 7,890

$ 7,890

$ 7,890

During the year ended December 31, 2019, $98.5 million of impairments were related to the 2019 Restructuring
During the year ended December 31, 2019, $98.5 million of impairments were related to the 2019 Restructuring
During the year ended December 31, 2019, $98.5 million of impairments were related to the 2019 Restructuring
166
program discussed in Note 6 "Restructuring" while the remaining $1.2 million were related to other identified
program discussed in Note 6 "Restructuring" while the remaining $1.2 million were related to other identified
program discussed in Note 6 "Restructuring" while the remaining $1.2 million were related to other identified
impairments during the year. In 2018, we recorded asset impairment charges of $7.9 million of internal-use software
impairments during the year. In 2018, we recorded asset impairment charges of $7.9 million of internal-use software
impairments during the year. In 2018, we recorded asset impairment charges of $7.9 million of internal-use software

of which $1.6 million related to the 2017 Restructuring program discussed in Note 6 "Restructuring" and $6.3

of which $1.6 million related to the 2017 Restructuring program discussed in Note 6 "Restructuring" and $6.3

of which $1.6 million related to the 2017 Restructuring program discussed in Note 6 "Restructuring" and $6.3

million related to strategic shifts in our business. No impairments to property, plant and equipment were recognized

million related to strategic shifts in our business. No impairments to property, plant and equipment were recognized

million related to strategic shifts in our business. No impairments to property, plant and equipment were recognized

during the year ended December 31, 2017.

during the year ended December 31, 2017.

during the year ended December 31, 2017.

For the years ended December 31, 2019, 2018 and 2017 depreciation and amortization expense totaled $86.0

For the years ended December 31, 2019, 2018 and 2017 depreciation and amortization expense totaled $86.0

For the years ended December 31, 2019, 2018 and 2017 depreciation and amortization expense totaled $86.0

million, $87.9 million and $82.5 million, respectively. For the years ended December 31, 2019, 2018 and 2017

million, $87.9 million and $82.5 million, respectively. For the years ended December 31, 2019, 2018 and 2017

million, $87.9 million and $82.5 million, respectively. For the years ended December 31, 2019, 2018 and 2017

amortization related to computer software to be sold, leased or marketed totaled $18.3 million, $17.2 million and

amortization related to computer software to be sold, leased or marketed totaled $18.3 million, $17.2 million and

amortization related to computer software to be sold, leased or marketed totaled $18.3 million, $17.2 million and

$13.9 million, respectively. Impairment charges related to computer software to be sold, leased or marketed are

$13.9 million, respectively. Impairment charges related to computer software to be sold, leased or marketed are

$13.9 million, respectively. Impairment charges related to computer software to be sold, leased or marketed are

included in computer software and construction in progress in the table above and totaled $65.9 million for the year

included in computer software and construction in progress in the table above and totaled $65.9 million for the year

included in computer software and construction in progress in the table above and totaled $65.9 million for the year

ended December 31, 2019. As of December 31, 2019 and 2018, the unamortized balance of computer software

ended December 31, 2019. As of December 31, 2019 and 2018, the unamortized balance of computer software

ended December 31, 2019. As of December 31, 2019 and 2018, the unamortized balance of computer software

to be sold, leased or marketed was $36.6 million and $100.5 million, respectively.

to be sold, leased or marketed was $36.6 million and $100.5 million, respectively.

to be sold, leased or marketed was $36.6 million and $100.5 million, respectively.

Repairs and maintenance expense was $10.7 million, $12.1 million and $12.7 million in 2019, 2018 and 2017,

Repairs and maintenance expense was $10.7 million, $12.1 million and $12.7 million in 2019, 2018 and 2017,

Repairs and maintenance expense was $10.7 million, $12.1 million and $12.7 million in 2019, 2018 and 2017,

respectively. For the year ended December 31, 2019 and 2018, construction in progress primarily includes amounts

respectively. For the year ended December 31, 2019 and 2018, construction in progress primarily includes amounts

respectively. For the year ended December 31, 2019 and 2018, construction in progress primarily includes amounts

related to ongoing software development projects. For the years ended December 31, 2019, 2018 and 2017,

related to ongoing software development projects. For the years ended December 31, 2019, 2018 and 2017,

related to ongoing software development projects. For the years ended December 31, 2019, 2018 and 2017,

interest capitalized in connection with construction projects was not significant.

interest capitalized in connection with construction projects was not significant.

interest capitalized in connection with construction projects was not significant.

10. Investments

10. Investments

10. Investments

(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)Estimated usefullife(in years)20192018($ in thousands)Year ended December 31,20192018Total impairment in property, plant and equipment(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)Estimated usefullife(in years)20192018($ in thousands)Year ended December 31,20192018Total impairment in property, plant and equipment(in thousands)Estimated usefullife(in years)20192018($ in thousands)Year ended December 31,20192018Total impairment in property, plant and equipmentreleases of excess accruals as included in the table below were included in restructuring, acquisition, integration and

releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and

releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and

other, net.

other, net.

other, net.

The following table summarizes the cash components of the restructuring activity.

The following table summarizes the cash components of the restructuring activity.

The following table summarizes the cash components of the restructuring activity.

Foreign currency translation adjustment

(48)

Foreign currency translation adjustment

Foreign currency translation adjustment

—

(48)

(48)

—

—

(26)

(26)

(26)

(74)

(74)

(74)

Foreign currency translation adjustment

1

Foreign currency translation adjustment

Foreign currency translation adjustment

$ —

1

1

$ —

$ —

$ —

$ —

$ —

1

1

7. Short-Term Investments

7. Short-Term Investments

7. Short-Term Investments

Land

—

$ 17,684

$ 17,938

At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million

At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million

At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million

Buildings and improvements

341,032

322,751

5-40

We also conducted an impairment review of inventory and prepaid and other assets and recorded the charges

We also conducted an impairment review of inventory and prepaid and other assets and recorded the charges

($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables

($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables

($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables

Machinery and equipment

noted in the table below. As these charges, including inventory, are a direct result of the decision to suspend further

noted in the table below. As these charges, including inventory, are a direct result of the decision to suspend further

292,294

306,750

3-10

due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial

due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial

due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial

assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market

assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market

assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market

value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets

value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets

value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets

Furniture and office equipment

102,901

109,770

3-10

development of NGS-related instrument systems and are not related to external market factors, the impairment

development of NGS-related instrument systems and are not related to external market factors, the impairment

3-7

301,604

277,006

Computer software

charges were recorded in the line item restructuring, acquisition, integration and other, net in the consolidated

charges were recorded in the line item restructuring, acquisition, integration and other, net in the consolidated

statements of (loss) income due to the assets being deemed excess and no longer utilized due to the discontinued

statements of (loss) income due to the assets being deemed excess and no longer utilized due to the discontinued

as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is

as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is

as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is

—

98,858

80,874

determined using the effective interest rate method.

Construction in progress

development and related actions discussed above.

development and related actions discussed above.

determined using the effective interest rate method.

determined using the effective interest rate method.

In addition, we have initiated measures to:

In addition, we have initiated measures to:

Less: Accumulated depreciation and amortization

Property, plant and equipment, net

1,154,373

1,115,089

(699,130)

(603,430)

$ 455,243

$ 511,659

$ 4,294

Liability at December 31, 2017

Liability at December 31, 2017

$ 1,052

$ 4,294

$ 4,294

$ 1,052

$ 1,066

$ 1,066

$ 1,066

$ 1,052

$ 6,412

$ 6,412

$ 6,412

(343)

Release of excess accrual

Release of excess accrual

(838)

(343)

(343)

(838)

(838)

(546)

(546)

(546)

(1,727)

(1,727)

(1,727)

(3,648)

Payments

Payments

(214)

(3,648)

(3,648)

(214)

(214)

(494)

(494)

(494)

(4,356)

(4,356)

(4,356)

$ 255

$ —

$ 255

$ 255

$ —

$ —

$ —

$ —

$ —

$ 255

$ 255

$ 255

(31)

Release of excess accrual

Release of excess accrual

$ —

(31)

(31)

$ —

$ —

$ —

$ —

$ —

(31)

(31)

(225)

Payments

Payments

$ —

(225)

(225)

$ —

$ —

$ —

$ —

$ —

(225)

(225)

(31)

(225)

1

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

›

›

›

›

Money market deposits

shift Commercial Operations activities into Business Areas;
shift Commercial Operations activities into Business Areas;
Money market deposits
transition manufacturing activities into a regional structure; and
transition manufacturing activities into a regional structure; and
Commercial paper
expand the scope of activities at QIAGEN Business Services (QBS) centers in Wroclaw, Poland and Manila,
expand the scope of activities at QIAGEN Business Services (QBS) centers in Wroclaw, Poland and Manila,
Loans receivable
Philippines
Philippines

Amortization of assets acquired under capital lease obligations is included within accumulated depreciation and
F I N A N C I A L   R E S U LT S Notes to consolidated financial statements
amortization above for the years ended December 31, 2019 and 2018, respectively.Amortization of assets
22,459
acquired under capital lease obligations is included within accumulated depreciation and amortization above for the
years ended December 31, 2019 and 2018, respectively.

$ 87,468
$ 87,468

22,459
22,459

19,659
19,659

Commercial paper

Loans receivable

$ 87,468

19,659

›

›

$ 20,000

$ 20,000

179,219

179,219

35,037

35,037

$ 129,586
$ 129,586

$ 129,586

$ 234,256

$ 234,256

8. Prepaid Expenses and Other Current Assets

We recorded asset impairment charges as follows below for the years ended December 31, 2019 and 2018.

The following is a summary of the charges recorded during the year ended December 31, 2019.
The following is a summary of the charges recorded during the year ended December 31, 2019.
8. Prepaid Expenses and Other Current Assets

8. Prepaid Expenses and Other Current Assets

Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:

Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:

Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:

Machinery and equipment
Prepaid expenses

Prepaid expenses

$ 9,177
$ 45,409
$ 45,409

$ 45,409

$ —

$ 48,250

$ 48,250

Computer software

Other receivables

Personnel related (of which $2,956 due to related parties)

Other receivables
Personnel related (of which $2,956 due to related parties)

37,025
37,025
(22)

44,649

37,025

(22)

2,911

$ 70,578

11,127
$ 70,578

11,127

Furniture and office equipment
Value added tax

Contract termination costs (of which $15,676 due to related parties)

Value added tax
Contract termination costs (of which $15,676 due to related parties)

4,030
20,347
20,347

20,347

—
42,099

24,416
42,099

24,416

Construction in progress
Cash collateral
(14)
Cash collateral
Consulting fees
Consulting fees

(14)

(14)

2,683
2,683

41,870

2,683

4,979

10,150

25,368
10,150

25,368

Accounts receivable (of which $5,984 due from related parties)

Accounts receivable (of which $5,984 due from related parties)

$ 99,726
$ 105,464
$ 105,464

$ 105,464

$ 7,890

$ 109,161
$ 109,161
10,825
10,825

$ 109,161

$ 20,000

179,219

35,037

$ 234,256

$ 48,250

11,127

24,416

25,368

Liability at December 31, 2017

Release of excess accrual

Payments

Release of excess accrual

Payments

Money market deposits

Commercial paper

Loans receivable

Prepaid expenses

Other receivables

Value added tax

Cash collateral

9. Property, Plant and Equipment

follows as of December 31, 2019 and 2018:

Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as

Inventories

Inventories

12,336

12,336

Prepaid expenses and other assets (of which $12,915 was long-term and $2,270 due from related parties)

Prepaid expenses and other assets (of which $12,915 was long-term and $2,270 due from related parties)

9. Property, Plant and Equipment

9. Property, Plant and Equipment

During the year ended December 31, 2019, $98.5 million of impairments were related to the 2019 Restructuring
program discussed in Note 6 "Restructuring" while the remaining $1.2 million were related to other identified
impairments during the year. In 2018, we recorded asset impairment charges of $7.9 million of internal-use software
of which $1.6 million related to the 2017 Restructuring program discussed in Note 6 "Restructuring" and $6.3
million related to strategic shifts in our business. No impairments to property, plant and equipment were recognized
during the year ended December 31, 2017.

Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as
163,000
follows as of December 31, 2019 and 2018:

Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as
163,000
follows as of December 31, 2019 and 2018:

Property, plant and equipment

Property, plant and equipment

98,472

17,012

17,012

98,472

(9)

(9)

Intangible assets

Intangible assets

(11)

(11)

40,301

40,301

Equity method investment impairment

Equity method investment impairment

For the years ended December 31, 2019, 2018 and 2017 depreciation and amortization expense totaled $86.0
million, $87.9 million and $82.5 million, respectively. For the years ended December 31, 2019, 2018 and 2017
amortization related to computer software to be sold, leased or marketed totaled $18.3 million, $17.2 million and
$13.9 million, respectively. Impairment charges related to computer software to be sold, leased or marketed are
included in computer software and construction in progress in the table above and totaled $65.9 million for the year
ended December 31, 2019. As of December 31, 2019 and 2018, the unamortized balance of computer software
to be sold, leased or marketed was $36.6 million and $100.5 million, respectively.

Total

Total

(10)

(10)

138,773

138,773

4,799

4,799

$ 306,572

$ 306,572

Of the total costs incurred, $60.2 million are accrued as of December 31, 2019 in accrued and other current
Of the total costs incurred, $60.2 million are accrued as of December 31, 2019 in accrued and other current
liabilities in the accompanying consolidated balance sheet as summarized in the following table that includes the
liabilities in the accompanying consolidated balance sheet as summarized in the following table that includes the
cash components of the restructuring activity.
cash components of the restructuring activity.

Repairs and maintenance expense was $10.7 million, $12.1 million and $12.7 million in 2019, 2018 and 2017,
respectively. For the year ended December 31, 2019 and 2018, construction in progress primarily includes amounts
related to ongoing software development projects. For the years ended December 31, 2019, 2018 and 2017,
interest capitalized in connection with construction projects was not significant.

10. Investments

Costs incurred in 2019

Costs incurred in 2019

$ 44,640

$ 44,640

$ 42,099

$ 42,099

$ 10,150

$ 10,150

$ 96,889

$ 96,889

Payments

Payments

The following discusses our marketable investments, non-marketable investments and the realized and unrealized
Foreign currency translation adjustment
gains and losses on these investments.

Foreign currency translation adjustment

(53)

(53)

631

493

493

631

(17,272)

(17,272)

(18,294)

(18,294)

(2,162)

(2,162)

(37,728)

(37,728)

1,071

1,071

$ 27,999

$ 27,999

$ 24,298

$ 24,298

$ 7,935

$ 7,935

$ 60,232

$ 60,232

A summary of our investments in marketable equity securities that have readily determinable fair values that are
classified as available-for-sale follows below. These investments are reported at fair value with gains and losses
recorded in earnings beginning in January 2018 upon adoption of ASU 2016-01. Prior to adoption, these
investments were reported at fair value with unrealized gains and losses recognized in accumulated other
comprehensive income on the balance sheet. Accordingly, upon adoption, we recorded a cumulative effect
adjustment to decrease opening retained earnings at January 1, 2018 by a net of tax amount of $0.9 million (pre-
tax $1.1 million) for unrealized losses as of the adoption date.

Total cumulative unrealized (loss) gain

Shares held

Cost basis

Fair value

Shares held

Cost basis

Fair value

833,333

$ 2,000

$ 585

$ (1,415)

560,416

167
—

$ 285

$ 285

833,333

$ 2,000

$ 2,117

204,000

$ 1,444

$ 350

$ 117

$ (1,094)

Total cumulative unrealized gain (loss)

During 2019, we received 560,416 shares in Oncimmune in settlement of a zero-book value financial instrument

held with a third party. On the date of receipt, these shares held a fair value of $0.7 million which was recorded as

a gain in other income (expense), net in the accompanying statements of (loss) income. Also during 2019, we sold

the remaining 204,000 Curetis shares and recognized an immaterial loss in other income (expense), net.

During the year ended December 31, 2018, we sold 116,424 shares of Curetis and recognized a gain of $0.3

million in other income (expense), net in the accompanying statements of (loss) income.

During the years ended December 31, 2019 and 2018, losses recognized for the change in fair market value of all

marketable equity securities totaled $2.1 million and $0.1 million, respectively. As of December 31, 2019 and

2018, these marketable securities are included in other long-term assets in the accompanying consolidated balance

sheets.

We have made strategic investments in certain privately-held companies without readily determinable market values.

A summary of our non-marketable investments accounted for as equity method investments is as follows:

(in thousands)Estimated usefullife(in years)20192018($ in thousands)Year ended December 31,20192018Total impairment in property, plant and equipmentMarketable Equity SecuritiesNon-Marketable InvestmentsNon-Marketable Investments Accounted for Under the Equity Method(in thousands, except shares held)As of December 31, 2019HTG MolecularDiagnostics, Inc(HTGM)OncimmuneHoldingsplc(Oncimmune)(in thousands)As of December 31, 2018HTGMCuretis N.V.(Curetis)(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assetsConsolidated Statement of (Loss) Income Classification and Type of Charge (in thousands)Year endedDecember 31, 2019NoteTotalRestructuring, acquisition, integration and other, netLong-lived asset impairmentsOther (expense) income, net(in thousands)PersonnelRelatedContract TerminationConsultingFeesTotalLiability at December 31, 2019Consolidated Statement of (Loss) Income Classification and Type of Charge (in thousands)Year endedDecember 31, 2019NoteTotalRestructuring, acquisition, integration and other, netLong-lived asset impairmentsOther (expense) income, net(in thousands)PersonnelRelatedContract TerminationConsultingFeesTotalLiability at December 31, 2019 
 
The following discusses our marketable investments, non-marketable investments and the realized and unrealized

gains and losses on these investments.

A summary of our investments in marketable equity securities that have readily determinable fair values that are
classified as available-for-sale follows below. These investments are reported at fair value with gains and losses
recorded in earnings beginning in January 2018 upon adoption of ASU 2016-01. Prior to adoption, these
investments were reported at fair value with unrealized gains and losses recognized in accumulated other
comprehensive income on the balance sheet. Accordingly, upon adoption, we recorded a cumulative effect
adjustment to decrease opening retained earnings at January 1, 2018 by a net of tax amount of $0.9 million (pre-
tax $1.1 million) for unrealized losses as of the adoption date.

Shares held

Cost basis

Fair value

Total cumulative unrealized (loss) gain

Shares held

Cost basis

Fair value

Total cumulative unrealized gain (loss)

833,333

$ 2,000

$ 585

$ (1,415)

560,416

—

$ 285

$ 285

833,333

$ 2,000

$ 2,117

204,000

$ 1,444

$ 350

$ 117

$ (1,094)

During 2019, we received 560,416 shares in Oncimmune in settlement of a zero-book value financial instrument
held with a third party. On the date of receipt, these shares held a fair value of $0.7 million which was recorded as
a gain in other income (expense), net in the accompanying statements of (loss) income. Also during 2019, we sold
the remaining 204,000 Curetis shares and recognized an immaterial loss in other income (expense), net.

During the year ended December 31, 2018, we sold 116,424 shares of Curetis and recognized a gain of $0.3
million in other income (expense), net in the accompanying statements of (loss) income.

During the years ended December 31, 2019 and 2018, losses recognized for the change in fair market value of all
marketable equity securities totaled $2.1 million and $0.1 million, respectively. As of December 31, 2019 and
2018, these marketable securities are included in other long-term assets in the accompanying consolidated balance
sheets.

We have made strategic investments in certain privately-held companies without readily determinable market values.

A summary of our non-marketable investments accounted for as equity method investments is as follows:

168

Marketable Equity SecuritiesNon-Marketable InvestmentsNon-Marketable Investments Accounted for Under the Equity Method(in thousands, except shares held)As of December 31, 2019HTG MolecularDiagnostics, Inc(HTGM)OncimmuneHoldingsplc(Oncimmune)(in thousands)As of December 31, 2018HTGMCuretis N.V.(Curetis)releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and

releases of excess accruals as included in the table below were included in restructuring, acquisition, integration and

other, net.

other, net.

The following table summarizes the cash components of the restructuring activity.

The following table summarizes the cash components of the restructuring activity.

Liability at December 31, 2017

Liability at December 31, 2017

$ 4,294

$ 4,294

$ 1,052

$ 1,052

$ 1,066

$ 1,066

$ 6,412

$ 6,412

Foreign currency translation adjustment

Foreign currency translation adjustment

(48)

(48)

—

—

(26)

(26)

(74)

(74)

Release of excess accrual

Release of excess accrual

Payments

Payments

Release of excess accrual

Release of excess accrual

Payments

Payments

Foreign currency translation adjustment

Foreign currency translation adjustment

1

1

Total cumulative unrealized gain (loss)

$ —

$ —

$ —

$ 117

$ —

$ (1,094)

1

1

7. Short-Term Investments

7. Short-Term Investments

At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million

At December 31, 2019 and 2018, we had $129.6 million ($65.0 million and €57.5 million) and $234.3 million

($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables

($134.1 million and €87.5 million), respectively, of money market deposits, commercial paper and loan receivables

due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial

due from financial and nonfinancial institutions as summarized below. These instruments are non-derivative financial

During the year ended December 31, 2018, we sold 116,424 shares of Curetis and recognized a gain of $0.3

assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market

assets with fixed or determinable payments that are not quoted in an active market and are carried at fair market

million in other income (expense), net in the accompanying statements of (loss) income.

value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets

value, which is equal to the cost. All instruments are classified as current assets in the accompanying balance sheets

(343)

(343)

(838)

(838)

(546)

(546)

(1,727)

(1,727)

(3,648)

(3,648)

(214)

(214)

(494)

(494)

(4,356)

(4,356)

$ 255

$ 255

Shares held

$ —

$ —

$ —

833,333

$ —

204,000

$ 255

$ 255

(31)

(31)

Cost basis

$ —

$ —

$ —

$ 2,000

$ —

$ 1,444

(31)

(31)

(225)

(225)

Fair value

$ —

$ —

$ —

$ 2,117

$ —

$ 350

(225)

(225)

$ —

$ —

$ —

$ —

$ —

$ —

$ —

$ —

During 2019, we received 560,416 shares in Oncimmune in settlement of a zero-book value financial instrument

held with a third party. On the date of receipt, these shares held a fair value of $0.7 million which was recorded as

a gain in other income (expense), net in the accompanying statements of (loss) income. Also during 2019, we sold

the remaining 204,000 Curetis shares and recognized an immaterial loss in other income (expense), net.

The following discusses our marketable investments, non-marketable investments and the realized and unrealized

gains and losses on these investments.

A summary of our investments in marketable equity securities that have readily determinable fair values that are

classified as available-for-sale follows below. These investments are reported at fair value with gains and losses

recorded in earnings beginning in January 2018 upon adoption of ASU 2016-01. Prior to adoption, these

investments were reported at fair value with unrealized gains and losses recognized in accumulated other

comprehensive income on the balance sheet. Accordingly, upon adoption, we recorded a cumulative effect

adjustment to decrease opening retained earnings at January 1, 2018 by a net of tax amount of $0.9 million (pre-

tax $1.1 million) for unrealized losses as of the adoption date.

Shares held

Cost basis

Fair value

Total cumulative unrealized (loss) gain

833,333

$ 2,000

$ 585

$ (1,415)

560,416

—

$ 285

$ 285

as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is

as they either have a maturity of less than one year or are redeemable at our discretion. Interest income is

During the years ended December 31, 2019 and 2018, losses recognized for the change in fair market value of all
marketable equity securities totaled $2.1 million and $0.1 million, respectively. As of December 31, 2019 and
F I N A N C I A L   R E S U LT S Notes to consolidated financial statements
2018, these marketable securities are included in other long-term assets in the accompanying consolidated balance
sheets.

$ 87,468

$ 87,468

$ 20,000

$ 20,000

8. Prepaid Expenses and Other Current Assets

8. Prepaid Expenses and Other Current Assets

A summary of our non-marketable investments accounted for as equity method investments is as follows:

19,659

19,659

35,037

35,037

$ 129,586

$ 129,586

$ 234,256

$ 234,256

Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:

Prepaid expenses and other current assets are summarized as follows as of December 31, 2019 and 2018:

We have made strategic investments in certain privately-held companies without readily determinable market values.

22,459

22,459

179,219

179,219

9. Property, Plant and Equipment

9. Property, Plant and Equipment

Biotype Innovation GmbH
Biotype Innovation GmbH

Biotype Innovation GmbH
Biotype Innovation GmbH
Biotype Innovation GmbH

Biotype Innovation GmbH
Biotype Innovation GmbH

0.00 %
0.00 %

0.00 %
0.00 %
0.00 %

—
—

—
—
—

—
—
—
0.00 %
—
—
0.00 %

—
—

—
—
—
—
—

(123)
(123)

(123)
—
(123)
(123)
—

39
39

39
—
39
39
—

(123)
(123)

Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as

Property, plant and equipment, including equipment acquired under capital lease obligations, are summarized as

19.00 %
19.00 %

19.00 %
19.00 %
19.00 %

—
—

—
—
—

19.00 %
—
—
—
19.00 %
—
—

—
—

—
—
—
—
—

Pyrobett
Pyrobett

Pyrobett
Pyrobett
Pyrobett

Pyrobett
Pyrobett

PreAnalytiX GmbH
PreAnalytiX GmbH

PreAnalytiX GmbH
PreAnalytiX GmbH
PreAnalytiX GmbH

PreAnalytiX GmbH
PreAnalytiX GmbH

50.00 %
50.00 %
50.00 %
$ 45,409

$ 5,405
50.00 %
$ 5,405
$ 5,452
50.00 %
$ 5,405
$ 5,452
$ 45,409

$ 3,971
$ 5,452
$ 3,971
$ 3,971
$ 5,452

$ 5,452
$ 5,452
$ 5,452

50.00 %
50.00 %

$ 3,971
$ 3,971

$ 5,405
$ 5,405

$ 4,062
$ 4,062

$ 4,062
$ 5,405
$ 4,062
$ 4,062
$ 5,405

Suzhou Fuda Business Management and Consulting Partnership
Suzhou Fuda Business Management and Consulting Partnership
Suzhou Fuda Business Management and Consulting Partnership
Suzhou Fuda Business Management and Consulting Partnership
Suzhou Fuda Business Management and Consulting Partnership

33.67 %
Suzhou Fuda Business Management and Consulting Partnership
33.67 %
33.67 %
Suzhou Fuda Business Management and Consulting Partnership

37,025

33.67 %
33.67 %

3,100
3,100
3,100

3,100
3,100

37,025

33.67 %
3,138
3,138
3,138
33.67 %
3,138
3,138

—
3,100
—
—
—
3,100
—

TVM Life Science Ventures III
TVM Life Science Ventures III

TVM Life Science Ventures III
TVM Life Science Ventures III
TVM Life Science Ventures III

TVM Life Science Ventures III
TVM Life Science Ventures III

(14)

Apis Assay Technologies Ltd
Apis Assay Technologies Ltd
Apis Assay Technologies Ltd
Apis Assay Technologies Ltd
Apis Assay Technologies Ltd
(14)

Apis Assay Technologies Ltd
Apis Assay Technologies Ltd

20,347

4.80 %
4.80 %
4.80 %

4.80 %
4.80 %

1,219
1,219
1,219

1,219
1,219

20,347

—
—
—
4.80 %
—
—
4.80 %

(330)
1,219
(330)
(330)
1,219

(330)
(330)

19.00 %
19.00 %

19.00 %
19.00 %
19.00 %
2,683

719
719
719

719
719

19.00 %
770
770
770
19.00 %
770
770
2,683

(51)
719
(51)
(51)
719

(51)
(51)

Hombrechtikon Systems Engineering AG
Hombrechtikon Systems Engineering AG

Hombrechtikon Systems Engineering AG
Hombrechtikon Systems Engineering AG
Hombrechtikon Systems Engineering AG

Hombrechtikon Systems Engineering AG
Hombrechtikon Systems Engineering AG

19.00 %
19.00 %
$ 105,464

378
378
378
19.00 %
378
378
19.00 %
$ 105,464

19.00 %
19.00 %
19.00 %

(1,124)
(761)
(1,124)
(1,124)
(761)

(1,124)
(1,124)

(761)
(761)
(761)

(761)
(761)

MAQGEN Biotechnology Co., Ltd
MAQGEN Biotechnology Co., Ltd

MAQGEN Biotechnology Co., Ltd
MAQGEN Biotechnology Co., Ltd
MAQGEN Biotechnology Co., Ltd

MAQGEN Biotechnology Co., Ltd
MAQGEN Biotechnology Co., Ltd

40.00 %
40.00 %

40.00 %
40.00 %
40.00 %

—
—

—
—
—

40.00 %
5,154
5,154
5,154
40.00 %
5,154
5,154

(383)
(383)

(383)
—
(383)
(383)
—

(579)
(579)

(579)
5,154
(579)
(579)
5,154

(542)
(542)

(542)
(383)
(542)
(542)
(383)

(579)
(579)

(542)

(542)

$ 3,818
$ 3,818

$ 4,062
$ 4,062

$ 3,818
$ 3,971
$ 3,818
$ 3,818
$ 3,971

$ 48,250

—
3,138
—
—
—
3,138
—

—
—

—
—
—
—
—

11,127

—

11,127

—

—

—

—
—

—
—
—
—
—

—
770
—
—
—
770
—

—
(330)
—
—
—
(330)
—

24,416

—

24,416

—

—

—

—
(51)
—
—
—
(51)
—

25,368

—

25,368

—

—

—

(668)
(668)

(668)
378
(668)
(668)
378

(346)
(1,124)
(346)
(346)
(346)
(1,124)
(346)
$ 109,161

(668)
(668)

$ 109,161

(346)

(346)

$ 3,818

$ 3,818

$ 48,250

39

39

195

195

(100)
—
(100)
(100)
—

(100)
(100)

(100)
(100)

195
—
195
195
—

195
195

$ 9,729
$ 9,729

$ 9,729
$ 9,729
$ 9,729

$ 14,845
$ 14,845

$ 14,845
$ 14,845
$ 14,845

$ 2,083
$ 2,083

$ 2,083
$ 9,729
$ 2,083
$ 2,083
$ 9,729

$ 2,592
$ 14,845
$ 2,592
$ 2,592
$ 2,592
$ 14,845
$ 2,592

$ 3,164
$ 3,164

$ 3,164
$ 2,083
$ 3,164
$ 3,164
$ 2,083

$ 2,592
$ 2,592

$ 3,164

$ 3,164

Of the $9.7 million of non-marketable investments accounted for as equity method investments, $10.5 million is
Of the $9.7 million of non-marketable investments accounted for as equity method investments, $10.5 million is
Of the $9.7 million of non-marketable investments accounted for as equity method investments, $10.5 million is
Of the $9.7 million of non-marketable investments accounted for as equity method investments, $10.5 million is
Of the $9.7 million of non-marketable investments accounted for as equity method investments, $10.5 million is
included in other long-term assets and $0.8 million, where we are committed to fund losses, is included in other long-
included in other long-term assets and $0.8 million, where we are committed to fund losses, is included in other long-
included in other long-term assets and $0.8 million, where we are committed to fund losses, is included in other long-
included in other long-term assets and $0.8 million, where we are committed to fund losses, is included in other long-
included in other long-term assets and $0.8 million, where we are committed to fund losses, is included in other long-
term liabilities in the accompanying consolidated balance sheets as of December 31, 2019.
term liabilities in the accompanying consolidated balance sheets as of December 31, 2019.
term liabilities in the accompanying consolidated balance sheets as of December 31, 2019.
term liabilities in the accompanying consolidated balance sheets as of December 31, 2019.
term liabilities in the accompanying consolidated balance sheets as of December 31, 2019.

Of the $9.7 million of non-marketable investments accounted for as equity method investments, $10.5 million is
Of the $9.7 million of non-marketable investments accounted for as equity method investments, $10.5 million is
included in other long-term assets and $0.8 million, where we are committed to fund losses, is included in other long-
included in other long-term assets and $0.8 million, where we are committed to fund losses, is included in other long-
term liabilities in the accompanying consolidated balance sheets as of December 31, 2019.
term liabilities in the accompanying consolidated balance sheets as of December 31, 2019.

During 2019, we made an investment in TVM Life Science Ventures III and as of December 31, 2019 we hold a
During 2019, we made an investment in TVM Life Science Ventures III and as of December 31, 2019 we hold a
During 2019, we made an investment in TVM Life Science Ventures III and as of December 31, 2019 we hold a
During 2019, we made an investment in TVM Life Science Ventures III and as of December 31, 2019 we hold a
During 2019, we made an investment in TVM Life Science Ventures III and as of December 31, 2019 we hold a
During 2019, we made an investment in TVM Life Science Ventures III and as of December 31, 2019 we hold a
During 2019, we made an investment in TVM Life Science Ventures III and as of December 31, 2019 we hold a
4.8% ownership stake in this limited partnership that is accounted for under the equity method as we have the ability
4.8% ownership stake in this limited partnership that is accounted for under the equity method as we have the ability
4.8% ownership stake in this limited partnership that is accounted for under the equity method as we have the ability
4.8% ownership stake in this limited partnership that is accounted for under the equity method as we have the ability
4.8% ownership stake in this limited partnership that is accounted for under the equity method as we have the ability
4.8% ownership stake in this limited partnership that is accounted for under the equity method as we have the ability
4.8% ownership stake in this limited partnership that is accounted for under the equity method as we have the ability
to exercise significant influence over the limited partnership. Also during the year ended December 31, 2019, we
to exercise significant influence over the limited partnership. Also during the year ended December 31, 2019, we
to exercise significant influence over the limited partnership. Also during the year ended December 31, 2019, we
to exercise significant influence over the limited partnership. Also during the year ended December 31, 2019, we
to exercise significant influence over the limited partnership. Also during the year ended December 31, 2019, we
to exercise significant influence over the limited partnership. Also during the year ended December 31, 2019, we
to exercise significant influence over the limited partnership. Also during the year ended December 31, 2019, we
recorded an impairment of $4.8 million in other income (expense), net in the accompanying consolidated statements
recorded an impairment of $4.8 million in other income (expense), net in the accompanying consolidated statements
recorded an impairment of $4.8 million in other income (expense), net in the accompanying consolidated statements
recorded an impairment of $4.8 million in other income (expense), net in the accompanying consolidated statements
recorded an impairment of $4.8 million in other income (expense), net in the accompanying consolidated statements
recorded an impairment of $4.8 million in other income (expense), net in the accompanying consolidated statements
recorded an impairment of $4.8 million in other income (expense), net in the accompanying consolidated statements
of income, following changes in circumstances of MAQGEN Biotechnology Co., Ltd that indicated the carrying value
of income, following changes in circumstances of MAQGEN Biotechnology Co., Ltd that indicated the carrying value
of income, following changes in circumstances of MAQGEN Biotechnology Co., Ltd that indicated the carrying value
of income, following changes in circumstances of MAQGEN Biotechnology Co., Ltd that indicated the carrying value
of income, following changes in circumstances of MAQGEN Biotechnology Co., Ltd that indicated the carrying value
of income, following changes in circumstances of MAQGEN Biotechnology Co., Ltd that indicated the carrying value
of income, following changes in circumstances of MAQGEN Biotechnology Co., Ltd that indicated the carrying value
was no longer recoverable. Accordingly, the investment was fully impaired.
was no longer recoverable. Accordingly, the investment was fully impaired.
was no longer recoverable. Accordingly, the investment was fully impaired.
was no longer recoverable. Accordingly, the investment was fully impaired.
was no longer recoverable. Accordingly, the investment was fully impaired.
was no longer recoverable. Accordingly, the investment was fully impaired.
was no longer recoverable. Accordingly, the investment was fully impaired.

In 2018, we recorded impairments totaling $6.1 million in other (expense) income, net in the accompanying
In 2018, we recorded impairments totaling $6.1 million in other (expense) income, net in the accompanying
In 2018, we recorded impairments totaling $6.1 million in other (expense) income, net in the accompanying
In 2018, we recorded impairments totaling $6.1 million in other (expense) income, net in the accompanying
In 2018, we recorded impairments totaling $6.1 million in other (expense) income, net in the accompanying
In 2018, we recorded impairments totaling $6.1 million in other (expense) income, net in the accompanying
In 2018, we recorded impairments totaling $6.1 million in other (expense) income, net in the accompanying
consolidated statements of income, following changes in the investees' circumstances that indicated the carrying
consolidated statements of income, following changes in the investees' circumstances that indicated the carrying
consolidated statements of income, following changes in the investees' circumstances that indicated the carrying
consolidated statements of income, following changes in the investees' circumstances that indicated the carrying
consolidated statements of income, following changes in the investees' circumstances that indicated the carrying
consolidated statements of income, following changes in the investees' circumstances that indicated the carrying
consolidated statements of income, following changes in the investees' circumstances that indicated the carrying
value was no longer recoverable. During 2017, we sold our interest in QIAGEN (Suzhou) Institute of Translation
value was no longer recoverable. During 2017, we sold our interest in QIAGEN (Suzhou) Institute of Translation
value was no longer recoverable. During 2017, we sold our interest in QIAGEN (Suzhou) Institute of Translation
value was no longer recoverable. During 2017, we sold our interest in QIAGEN (Suzhou) Institute of Translation
value was no longer recoverable. During 2017, we sold our interest in QIAGEN (Suzhou) Institute of Translation
value was no longer recoverable. During 2017, we sold our interest in QIAGEN (Suzhou) Institute of Translation
value was no longer recoverable. During 2017, we sold our interest in QIAGEN (Suzhou) Institute of Translation
Research Co., Ltd., which had no book value at the time of sale, for $3.5 million and recorded a corresponding gain
Research Co., Ltd., which had no book value at the time of sale, for $3.5 million and recorded a corresponding gain
Research Co., Ltd., which had no book value at the time of sale, for $3.5 million and recorded a corresponding gain
Research Co., Ltd., which had no book value at the time of sale, for $3.5 million and recorded a corresponding gain
Research Co., Ltd., which had no book value at the time of sale, for $3.5 million and recorded a corresponding gain
Research Co., Ltd., which had no book value at the time of sale, for $3.5 million and recorded a corresponding gain
Research Co., Ltd., which had no book value at the time of sale, for $3.5 million and recorded a corresponding gain
in other income (expense), net in the accompanying statements of income.
in other income (expense), net in the accompanying statements of income.
in other income (expense), net in the accompanying statements of income.
in other income (expense), net in the accompanying statements of income.
in other income (expense), net in the accompanying statements of income.
in other income (expense), net in the accompanying statements of income.
in other income (expense), net in the accompanying statements of income.

Three of our equity method investments are variable interest entities and we are not the primary beneficiary as we do
Three of our equity method investments are variable interest entities and we are not the primary beneficiary as we do
Three of our equity method investments are variable interest entities and we are not the primary beneficiary as we do
Three of our equity method investments are variable interest entities and we are not the primary beneficiary as we do
Three of our equity method investments are variable interest entities and we are not the primary beneficiary as we do
not hold the power to direct the activities that most significantly impact the economic performance. Therefore, these
not hold the power to direct the activities that most significantly impact the economic performance. Therefore, these
not hold the power to direct the activities that most significantly impact the economic performance. Therefore, these
not hold the power to direct the activities that most significantly impact the economic performance. Therefore, these
not hold the power to direct the activities that most significantly impact the economic performance. Therefore, these
investments are not consolidated. As of December 31, 2019 and 2018, these investments had a total net carrying
investments are not consolidated. As of December 31, 2019 and 2018, these investments had a total net carrying
investments are not consolidated. As of December 31, 2019 and 2018, these investments had a total net carrying
investments are not consolidated. As of December 31, 2019 and 2018, these investments had a total net carrying
investments are not consolidated. As of December 31, 2019 and 2018, these investments had a total net carrying
value of $1.2 million, of which $1.9 million is included in other long-term assets and $0.8 million is included in other
value of $1.2 million, of which $1.9 million is included in other long-term assets and $0.8 million is included in other
value of $1.2 million, of which $1.9 million is included in other long-term assets and $0.8 million is included in other
value of $1.2 million, of which $1.9 million is included in other long-term assets and $0.8 million is included in other
value of $1.2 million, of which $1.9 million is included in other long-term assets and $0.8 million is included in other
long-term liabilities in the accompanying consolidated balance sheet. As of December 31, 2018, these investments
long-term liabilities in the accompanying consolidated balance sheet. As of December 31, 2018, these investments
long-term liabilities in the accompanying consolidated balance sheet. As of December 31, 2018, these investments
long-term liabilities in the accompanying consolidated balance sheet. As of December 31, 2018, these investments
long-term liabilities in the accompanying consolidated balance sheet. As of December 31, 2018, these investments
held a balance of $1.1 million which is included in other long-term assets in the consolidated balance sheet. These
held a balance of $1.1 million which is included in other long-term assets in the consolidated balance sheet. These
held a balance of $1.1 million which is included in other long-term assets in the consolidated balance sheet. These
held a balance of $1.1 million which is included in other long-term assets in the consolidated balance sheet. These
held a balance of $1.1 million which is included in other long-term assets in the consolidated balance sheet. These
balances represent our maximum exposure to loss.
balances represent our maximum exposure to loss.
balances represent our maximum exposure to loss.
balances represent our maximum exposure to loss.
balances represent our maximum exposure to loss.

Three of our equity method investments are variable interest entities and we are not the primary beneficiary as we do
Three of our equity method investments are variable interest entities and we are not the primary beneficiary as we do
not hold the power to direct the activities that most significantly impact the economic performance. Therefore, these
not hold the power to direct the activities that most significantly impact the economic performance. Therefore, these
investments are not consolidated. As of December 31, 2019 and 2018, these investments had a total net carrying
investments are not consolidated. As of December 31, 2019 and 2018, these investments had a total net carrying
value of $1.2 million, of which $1.9 million is included in other long-term assets and $0.8 million is included in other
value of $1.2 million, of which $1.9 million is included in other long-term assets and $0.8 million is included in other
long-term liabilities in the accompanying consolidated balance sheet. As of December 31, 2018, these investments
long-term liabilities in the accompanying consolidated balance sheet. As of December 31, 2018, these investments
held a balance of $1.1 million which is included in other long-term assets in the consolidated balance sheet. These
held a balance of $1.1 million which is included in other long-term assets in the consolidated balance sheet. These
balances represent our maximum exposure to loss.
balances represent our maximum exposure to loss.

At December 31, 2019 and 2018, we had investments in non-publicly traded companies that do not have readily
At December 31, 2019 and 2018, we had investments in non-publicly traded companies that do not have readily
At December 31, 2019 and 2018, we had investments in non-publicly traded companies that do not have readily
At December 31, 2019 and 2018, we had investments in non-publicly traded companies that do not have readily
At December 31, 2019 and 2018, we had investments in non-publicly traded companies that do not have readily
determinable fair values with carrying amounts that totaled $70.8 million and $59.5 million, respectively. The
determinable fair values with carrying amounts that totaled $70.8 million and $59.5 million, respectively. The
determinable fair values with carrying amounts that totaled $70.8 million and $59.5 million, respectively. The
determinable fair values with carrying amounts that totaled $70.8 million and $59.5 million, respectively. The
determinable fair values with carrying amounts that totaled $70.8 million and $59.5 million, respectively. The
changes in these investments which are measured at cost, less any impairment, plus or minus changes resulting from
changes in these investments which are measured at cost, less any impairment, plus or minus changes resulting from
changes in these investments which are measured at cost, less any impairment, plus or minus changes resulting from
changes in these investments which are measured at cost, less any impairment, plus or minus changes resulting from
changes in these investments which are measured at cost, less any impairment, plus or minus changes resulting from
observable price changes in orderly transactions for the identical or a similar investment of the same issuer for the
observable price changes in orderly transactions for the identical or a similar investment of the same issuer for the
observable price changes in orderly transactions for the identical or a similar investment of the same issuer for the
observable price changes in orderly transactions for the identical or a similar investment of the same issuer for the
observable price changes in orderly transactions for the identical or a similar investment of the same issuer for the
years ended December 31, 2019 and 2018 are as follows:
years ended December 31, 2019 and 2018 are as follows:
years ended December 31, 2019 and 2018 are as follows:
years ended December 31, 2019 and 2018 are as follows:
years ended December 31, 2019 and 2018 are as follows:

At December 31, 2019 and 2018, we had investments in non-publicly traded companies that do not have readily
At December 31, 2019 and 2018, we had investments in non-publicly traded companies that do not have readily
determinable fair values with carrying amounts that totaled $70.8 million and $59.5 million, respectively. The
determinable fair values with carrying amounts that totaled $70.8 million and $59.5 million, respectively. The
changes in these investments which are measured at cost, less any impairment, plus or minus changes resulting from
changes in these investments which are measured at cost, less any impairment, plus or minus changes resulting from
observable price changes in orderly transactions for the identical or a similar investment of the same issuer for the
observable price changes in orderly transactions for the identical or a similar investment of the same issuer for the
years ended December 31, 2019 and 2018 are as follows:
years ended December 31, 2019 and 2018 are as follows:

169

determined using the effective interest rate method.

determined using the effective interest rate method.

Money market deposits

Money market deposits

Commercial paper

Commercial paper

Loans receivable

Loans receivable

Prepaid expenses

Prepaid expenses

Other receivables

Other receivables

Value added tax

Value added tax

Cash collateral

Cash collateral

follows as of December 31, 2019 and 2018:

follows as of December 31, 2019 and 2018:

Non-Marketable Investments Not Accounted for Under the Equity Method(in thousands)OwnershipPercentageEquity investments as ofDecember 31,Share of income (loss)for the yearsended December 31,20192018201920182017Marketable Equity SecuritiesNon-Marketable InvestmentsNon-Marketable Investments Accounted for Under the Equity Method(in thousands, except shares held)As of December 31, 2019HTG MolecularDiagnostics, Inc(HTGM)OncimmuneHoldingsplc(Oncimmune)(in thousands)As of December 31, 2018HTGMCuretis N.V.(Curetis)Non-Marketable Investments Not Accounted for Under the Equity Method(in thousands)OwnershipPercentageEquity investments as ofDecember 31,Share of income (loss)for the yearsended December 31,20192018201920182017(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assets(in thousands)PersonnelRelatedFacility RelatedContract andOther CostsTotalLiability at December 31, 2018Liability at December 31, 2019(in thousands)December 31,2019December 31,2018Total(in thousands)Notes20192018Total prepaid expenses and other current assetsNon-Marketable Investments Not Accounted for Under the Equity Method(in thousands)OwnershipPercentageEquity investments as ofDecember 31,Share of income (loss)for the yearsended December 31,20192018201920182017Non-Marketable Investments Not Accounted for Under the Equity Method(in thousands)OwnershipPercentageEquity investments as ofDecember 31,Share of income (loss)for the yearsended December 31,20192018201920182017Non-Marketable Investments Not Accounted for Under the Equity Method(in thousands)OwnershipPercentageEquity investments as ofDecember 31,Share of income (loss)for the yearsended December 31,20192018201920182017Non-Marketable Investments Not Accounted for Under the Equity Method(in thousands)OwnershipPercentageEquity investments as ofDecember 31,Share of income (loss)for the yearsended December 31,20192018201920182017Non-Marketable Investments Not Accounted for Under the Equity Method(in thousands)OwnershipPercentageEquity investments as ofDecember 31,Share of income (loss)for the yearsended December 31,20192018201920182017PreAnalytiX GmbH

50.00 %

$ 5,452

$ 5,405

$ 3,971

$ 4,062

$ 3,818

Suzhou Fuda Business Management and Consulting Partnership

33.67 %

3,100

3,138

Hombrechtikon Systems Engineering AG

19.00 %

(761)

(1,124)

4.80 %

1,219

19.00 %

719

40.00 %

0.00 %

19.00 %

—

—

—

—

770

378

—

—

5,154

(383)

—

(330)

(51)

—

—

—

—

—

(668)

(579)

(123)

(100)

—

—

—

(346)

(542)

39

195

$ 9,729

$ 14,845

$ 2,083

$ 2,592

$ 3,164

TVM Life Science Ventures III

Apis Assay Technologies Ltd

MAQGEN Biotechnology Co., Ltd

Biotype Innovation GmbH

Pyrobett

Of the $9.7 million of non-marketable investments accounted for as equity method investments, $10.5 million is

included in other long-term assets and $0.8 million, where we are committed to fund losses, is included in other long-

term liabilities in the accompanying consolidated balance sheets as of December 31, 2019.

During 2019, we made an investment in TVM Life Science Ventures III and as of December 31, 2019 we hold a

4.8% ownership stake in this limited partnership that is accounted for under the equity method as we have the ability

to exercise significant influence over the limited partnership. Also during the year ended December 31, 2019, we

recorded an impairment of $4.8 million in other income (expense), net in the accompanying consolidated statements

of income, following changes in circumstances of MAQGEN Biotechnology Co., Ltd that indicated the carrying value

was no longer recoverable. Accordingly, the investment was fully impaired.

In 2018, we recorded impairments totaling $6.1 million in other (expense) income, net in the accompanying

consolidated statements of income, following changes in the investees' circumstances that indicated the carrying

value was no longer recoverable. During 2017, we sold our interest in QIAGEN (Suzhou) Institute of Translation

Research Co., Ltd., which had no book value at the time of sale, for $3.5 million and recorded a corresponding gain

in other income (expense), net in the accompanying statements of income.

Three of our equity method investments are variable interest entities and we are not the primary beneficiary as we do
not hold the power to direct the activities that most significantly impact the economic performance. Therefore, these
investments are not consolidated. As of December 31, 2019 and 2018, these investments had a total net carrying
value of $1.2 million, of which $1.9 million is included in other long-term assets and $0.8 million is included in other
long-term liabilities in the accompanying consolidated balance sheet. As of December 31, 2018, these investments
held a balance of $1.1 million which is included in other long-term assets in the consolidated balance sheet. These
balances represent our maximum exposure to loss.

At December 31, 2019 and 2018, we had investments in non-publicly traded companies that do not have readily
determinable fair values with carrying amounts that totaled $70.8 million and $59.5 million, respectively. The
changes in these investments which are measured at cost, less any impairment, plus or minus changes resulting from
observable price changes in orderly transactions for the identical or a similar investment of the same issuer for the
years ended December 31, 2019 and 2018 are as follows:

Balance at beginning of year
Balance at beginning of year

Balance at beginning of year

Balance at beginning of year

$ 59,484
$ 59,484

$ 59,484

$ 59,484

$ 33,605
$ 33,605

$ 33,605

$ 33,605

Cash investments in equity securities, net
Cash investments in equity securities, net

Cash investments in equity securities, net

Cash investments in equity securities, net

3,619
3,619

3,619

3,619

9,633
9,633

9,633

9,633

Net increases due to observable price changes
Net increases due to observable price changes

Net increases due to observable price changes

Net increases due to observable price changes

Conversion of note receivable to equity securities
Conversion of note receivable to equity securities

Conversion of note receivable to equity securities

Conversion of note receivable to equity securities

Sale of equity securities
Sale of equity securities

Sale of equity securities

Sale of equity securities

Full acquisition of equity securities
Full acquisition of equity securities

Full acquisition of equity securities

Full acquisition of equity securities

7,760
7,760

7,760

7,760

—
—

—
—

—
—

—

—

—

—

—

—

13,104
13,104

13,104

13,104

11,369
11,369

11,369

11,369

(5,400)
(5,400)

(5,400)

(5,400)

(2,710)
(2,710)

(2,710)

(2,710)

Foreign currency translation adjustments
Foreign currency translation adjustments

Foreign currency translation adjustments

Foreign currency translation adjustments

(14)
(14)

(14)

(14)

(117)
(117)

(117)

(117)

Balance at end of year
Balance at end of year

Balance at end of year

Balance at end of year

$ 70,849
$ 70,849

$ 70,849

$ 70,849

$ 59,484
$ 59,484

$ 59,484

$ 59,484

During 2019, we made additional investments of $3.6 million in non-marketable investments not accounted for under
During 2019, we made additional investments of $3.6 million in non-marketable investments not accounted for under
the equity method. As of December 31, 2019 and December 31, 2018, investments in variable interest entities had
the equity method. As of December 31, 2019 and December 31, 2018, investments in variable interest entities had
a total carrying value of $41.0 million which is included in other long-term assets in the consolidated balance sheets,
a total carrying value of $41.0 million which is included in other long-term assets in the consolidated balance sheets,
representing our maximum exposure to loss.
representing our maximum exposure to loss.

During 2019, we made additional investments of $3.6 million in non-marketable investments not accounted for under
During 2019, we made additional investments of $3.6 million in non-marketable investments not accounted for under
the equity method. As of December 31, 2019 and December 31, 2018, investments in variable interest entities had
the equity method. As of December 31, 2019 and December 31, 2018, investments in variable interest entities had
a total carrying value of $41.0 million which is included in other long-term assets in the consolidated balance sheets,
a total carrying value of $41.0 million which is included in other long-term assets in the consolidated balance sheets,
representing our maximum exposure to loss.
representing our maximum exposure to loss.

Since adoption of ASU 2016-01, upward adjustments in the carrying value of these investments have been
Since adoption of ASU 2016-01, upward adjustments in the carrying value of these investments have been
Since adoption of ASU 2016-01, upward adjustments in the carrying value of these investments have been
Since adoption of ASU 2016-01, upward adjustments in the carrying value of these investments have been
recognized for observable price changes totaling $20.9 million, of which $7.8 million occurred in 2019 and $13.1
recognized for observable price changes totaling $20.9 million, of which $7.8 million occurred in 2019 and $13.1
recognized for observable price changes totaling $20.9 million, of which $7.8 million occurred in 2019 and $13.1
recognized for observable price changes totaling $20.9 million, of which $7.8 million occurred in 2019 and $13.1
million was recognized in 2018 in other income (expense), net in the accompanying consolidated statements of
million was recognized in 2018 in other income (expense), net in the accompanying consolidated statements of
million was recognized in 2018 in other income (expense), net in the accompanying consolidated statements of
million was recognized in 2018 in other income (expense), net in the accompanying consolidated statements of
income. These adjustments were due to equity offerings at a higher price from the issuer in orderly transactions for
income. These adjustments were due to equity offerings at a higher price from the issuer in orderly transactions for
income. These adjustments were due to equity offerings at a higher price from the issuer in orderly transactions for
income. These adjustments were due to equity offerings at a higher price from the issuer in orderly transactions for
identical or similar investments as those we hold.
identical or similar investments as those we hold.
identical or similar investments as those we hold.
identical or similar investments as those we hold.

During 2018, we made investments of $9.6 million in equity securities, of which $9.3 million was an additional
During 2018, we made investments of $9.6 million in equity securities, of which $9.3 million was an additional
During 2018, we made investments of $9.6 million in equity securities, of which $9.3 million was an additional
During 2018, we made investments of $9.6 million in equity securities, of which $9.3 million was an additional
investment in NeuMoDx Molecular, Inc. (NeuMoDx). The investment is part of a strategic partnership with NeuMoDx
investment in NeuMoDx Molecular, Inc. (NeuMoDx). The investment is part of a strategic partnership with NeuMoDx
investment in NeuMoDx Molecular, Inc. (NeuMoDx). The investment is part of a strategic partnership with NeuMoDx
investment in NeuMoDx Molecular, Inc. (NeuMoDx). The investment is part of a strategic partnership with NeuMoDx
to commercialize two new fully integrated systems for automation of PCR (polymerase chain reaction) testing. Under
to commercialize two new fully integrated systems for automation of PCR (polymerase chain reaction) testing. Under
to commercialize two new fully integrated systems for automation of PCR (polymerase chain reaction) testing. Under
to commercialize two new fully integrated systems for automation of PCR (polymerase chain reaction) testing. Under
the agreement, we will initially distribute the NeuMoDx™ 288 (high-throughput version) and NeuMoDx™ 96 (mid-
the agreement, we will initially distribute the NeuMoDx™ 288 (high-throughput version) and NeuMoDx™ 96 (mid-
the agreement, we will initially distribute the NeuMoDx™ 288 (high-throughput version) and NeuMoDx™ 96 (mid-
the agreement, we will initially distribute the NeuMoDx™ 288 (high-throughput version) and NeuMoDx™ 96 (mid-
throughput version) in Europe and other major markets worldwide outside of the United States. NeuMoDx will
throughput version) in Europe and other major markets worldwide outside of the United States. NeuMoDx will
throughput version) in Europe and other major markets worldwide outside of the United States. NeuMoDx will
throughput version) in Europe and other major markets worldwide outside of the United States. NeuMoDx will
distribute these instruments within the United States directly. The two companies have also entered into an agreement
distribute these instruments within the United States directly. The two companies have also entered into an agreement
distribute these instruments within the United States directly. The two companies have also entered into an agreement
distribute these instruments within the United States directly. The two companies have also entered into an agreement
under which we can acquire all NeuMoDx shares not currently owned by QIAGEN at a predetermined price of
under which we can acquire all NeuMoDx shares not currently owned by QIAGEN at a predetermined price of
under which we can acquire all NeuMoDx shares not currently owned by QIAGEN at a predetermined price of
under which we can acquire all NeuMoDx shares not currently owned by QIAGEN at a predetermined price of
approximately $234 million, subject to the achievement of certain regulatory and operational milestones.
approximately $234 million, subject to the achievement of certain regulatory and operational milestones.
approximately $234 million, subject to the achievement of certain regulatory and operational milestones.
approximately $234 million, subject to the achievement of certain regulatory and operational milestones.

During 2018, we converted a note receivable from a non-publicly traded company, considered a related party, into
During 2018, we converted a note receivable from a non-publicly traded company, considered a related party, into
During 2018, we converted a note receivable from a non-publicly traded company, considered a related party, into
During 2018, we converted a note receivable from a non-publicly traded company, considered a related party, into
an equity interest in that company. This note held a balance of $11.4 million including principal balance and
an equity interest in that company. This note held a balance of $11.4 million including principal balance and
an equity interest in that company. This note held a balance of $11.4 million including principal balance and
an equity interest in that company. This note held a balance of $11.4 million including principal balance and
accrued interest at conversion which was a non-cash investing activity and is therefore not included in the
accrued interest at conversion which was a non-cash investing activity and is therefore not included in the
accrued interest at conversion which was a non-cash investing activity and is therefore not included in the
accrued interest at conversion which was a non-cash investing activity and is therefore not included in the
consolidated statement of cash flows. Also during 2018, we sold our interest in a non-publicly traded company
consolidated statement of cash flows. Also during 2018, we sold our interest in a non-publicly traded company
consolidated statement of cash flows. Also during 2018, we sold our interest in a non-publicly traded company
consolidated statement of cash flows. Also during 2018, we sold our interest in a non-publicly traded company
which had a book value of $5.4 million. Proceeds from the sale totaled $10.5 million in cash resulting in a
which had a book value of $5.4 million. Proceeds from the sale totaled $10.5 million in cash resulting in a
which had a book value of $5.4 million. Proceeds from the sale totaled $10.5 million in cash resulting in a
which had a book value of $5.4 million. Proceeds from the sale totaled $10.5 million in cash resulting in a
corresponding gain of $5.1 million recorded in other income (expense), net in the accompanying consolidated
corresponding gain of $5.1 million recorded in other income (expense), net in the accompanying consolidated
corresponding gain of $5.1 million recorded in other income (expense), net in the accompanying consolidated
corresponding gain of $5.1 million recorded in other income (expense), net in the accompanying consolidated
statement of income. Additionally during 2018, we acquired all remaining shares of a privately held entity in which
statement of income. Additionally during 2018, we acquired all remaining shares of a privately held entity in which
statement of income. Additionally during 2018, we acquired all remaining shares of a privately held entity in which
statement of income. Additionally during 2018, we acquired all remaining shares of a privately held entity in which
we held a minority interest as discussed in Note 5 "Acquisitions and Divestitures".
we held a minority interest as discussed in Note 5 "Acquisitions and Divestitures".
we held a minority interest as discussed in Note 5 "Acquisitions and Divestitures".
we held a minority interest as discussed in Note 5 "Acquisitions and Divestitures".

In 2017, we recorded total impairments to non-marketable investments not accounted for under the equity method of
In 2017, we recorded total impairments to non-marketable investments not accounted for under the equity method of
$5.1 million in other income (expense), net in the accompanying consolidated statement of income.
$5.1 million in other income (expense), net in the accompanying consolidated statement of income.

In 2017, we recorded total impairments to non-marketable investments not accounted for under the equity method of
In 2017, we recorded total impairments to non-marketable investments not accounted for under the equity method of
$5.1 million in other income (expense), net in the accompanying consolidated statement of income.
$5.1 million in other income (expense), net in the accompanying consolidated statement of income.

170

11. Goodwill and Intangible Assets
11. Goodwill and Intangible Assets

11. Goodwill and Intangible Assets
11. Goodwill and Intangible Assets

The following sets forth the intangible assets by major asset class as of December 31, 2019 and 2018:

The following sets forth the intangible assets by major asset class as of December 31, 2019 and 2018:

The following sets forth the intangible assets by major asset class as of December 31, 2019 and 2018:

The following sets forth the intangible assets by major asset class as of December 31, 2019 and 2018:

Non-Marketable Investments Not Accounted for Under the Equity Method(in thousands)OwnershipPercentageEquity investments as ofDecember 31,Share of income (loss)for the yearsended December 31,20192018201920182017(in thousands)20192018(in thousands)20192018(in thousands)20192018(in thousands)20192018Balance at beginning of year

Cash investments in equity securities, net

Net increases due to observable price changes

Conversion of note receivable to equity securities

Sale of equity securities

Full acquisition of equity securities

Foreign currency translation adjustments

Balance at end of year

$ 59,484

$ 33,605

3,619

7,760

—

—

—

(14)

9,633

13,104

11,369

(5,400)

(2,710)

(117)

$ 70,849

$ 59,484

During 2019, we made additional investments of $3.6 million in non-marketable investments not accounted for under

the equity method. As of December 31, 2019 and December 31, 2018, investments in variable interest entities had

a total carrying value of $41.0 million which is included in other long-term assets in the consolidated balance sheets,

representing our maximum exposure to loss.

Since adoption of ASU 2016-01, upward adjustments in the carrying value of these investments have been

recognized for observable price changes totaling $20.9 million, of which $7.8 million occurred in 2019 and $13.1

million was recognized in 2018 in other income (expense), net in the accompanying consolidated statements of

income. These adjustments were due to equity offerings at a higher price from the issuer in orderly transactions for

identical or similar investments as those we hold.

During 2018, we made investments of $9.6 million in equity securities, of which $9.3 million was an additional

investment in NeuMoDx Molecular, Inc. (NeuMoDx). The investment is part of a strategic partnership with NeuMoDx

to commercialize two new fully integrated systems for automation of PCR (polymerase chain reaction) testing. Under

the agreement, we will initially distribute the NeuMoDx™ 288 (high-throughput version) and NeuMoDx™ 96 (mid-

throughput version) in Europe and other major markets worldwide outside of the United States. NeuMoDx will

distribute these instruments within the United States directly. The two companies have also entered into an agreement

under which we can acquire all NeuMoDx shares not currently owned by QIAGEN at a predetermined price of

approximately $234 million, subject to the achievement of certain regulatory and operational milestones.

During 2018, we converted a note receivable from a non-publicly traded company, considered a related party, into
an equity interest in that company. This note held a balance of $11.4 million including principal balance and
F I N A N C I A L   R E S U LT S Notes to consolidated financial statements
accrued interest at conversion which was a non-cash investing activity and is therefore not included in the
consolidated statement of cash flows. Also during 2018, we sold our interest in a non-publicly traded company
which had a book value of $5.4 million. Proceeds from the sale totaled $10.5 million in cash resulting in a
corresponding gain of $5.1 million recorded in other income (expense), net in the accompanying consolidated
statement of income. Additionally during 2018, we acquired all remaining shares of a privately held entity in which
we held a minority interest as discussed in Note 5 "Acquisitions and Divestitures".

In 2017, we recorded total impairments to non-marketable investments not accounted for under the equity method of
$5.1 million in other income (expense), net in the accompanying consolidated statement of income.

11. Goodwill and Intangible Assets

The following sets forth the intangible assets by major asset class as of December 31, 2019 and 2018:

Amortized Intangible Assets:
Amortized Intangible Assets:

Amortized Intangible Assets:

Patent and license rights
Patent and license rights

Patent and license rights

10.19
10.19

10.19

$ 320,406
$ 320,406

$ 320,406

$ (216,554)
$ (216,554)

$ (216,554)

$ 448,220
$ 448,220

$ 448,220

$ (310,040)
$ (310,040)

$ (310,040)

Developed technology
Developed technology

Developed technology

10.96
10.96

10.96

766,966
766,966

766,966

(346,085)
(346,085)

(346,085)

770,955
770,955

770,955

(561,615)
(561,615)

(561,615)

Customer base, trademarks, and non-compete
Customer base, trademarks, and non-compete
agreements
agreements

Customer base, trademarks, and non-compete
agreements

11.68
11.68

11.68

314,638
314,638

314,638

(213,881)
(213,881)

(213,881)

427,512
427,512

427,512

(323,024)
(323,024)

(323,024)

10.95
10.95

10.95

$ 1,402,010
$ 1,402,010

$ 1,402,010

$ (776,520)
$ (776,520)

$ (776,520)

$ 1,646,687
$ 1,646,687

$ 1,646,687

$ (1,194,679)
$ (1,194,679)

$ (1,194,679)

Unamortized Intangible Assets:
Unamortized Intangible Assets:

Unamortized Intangible Assets:

In-process research and development
In-process research and development

In-process research and development

Goodwill
Goodwill

Goodwill

$ 6,944
$ 6,944

$ 6,944

2,140,503
2,140,503

2,140,503

$ 23,035
$ 23,035

$ 23,035

2,108,536
2,108,536

2,108,536

$ 2,147,447
$ 2,147,447

$ 2,147,447

$ 2,131,571
$ 2,131,571

$ 2,131,571

The in-process research and development is associated to the acquisition of STAT-Dx as further discussed in Note 5
The in-process research and development is associated to the acquisition of STAT-Dx as further discussed in Note 5
The in-process research and development is associated to the acquisition of STAT-Dx as further discussed in Note 5
"Acquisitions and Divestitures". The estimated fair value of acquired in-process research and development projects
"Acquisitions and Divestitures". The estimated fair value of acquired in-process research and development projects
"Acquisitions and Divestitures". The estimated fair value of acquired in-process research and development projects
which have not reached technological feasibility at the date of acquisition are capitalized and subsequently tested
which have not reached technological feasibility at the date of acquisition are capitalized and subsequently tested
which have not reached technological feasibility at the date of acquisition are capitalized and subsequently tested
for impairment through completion of the development process, at which point the capitalized amounts are
for impairment through completion of the development process, at which point the capitalized amounts are
for impairment through completion of the development process, at which point the capitalized amounts are
amortized over their estimated useful life. If a project is abandoned rather than completed, all capitalized amounts
amortized over their estimated useful life. If a project is abandoned rather than completed, all capitalized amounts
amortized over their estimated useful life. If a project is abandoned rather than completed, all capitalized amounts
are written-off immediately. During 2019, one development project was completed and, after testing for impairment,
are written-off immediately. During 2019, one development project was completed and, after testing for impairment,
are written-off immediately. During 2019, one development project was completed and, after testing for impairment,
$15.9 million of in-process research and development costs were reclassified into developed technology.
$15.9 million of in-process research and development costs were reclassified into developed technology.
$15.9 million of in-process research and development costs were reclassified into developed technology.

Developed technology includes the digital PCR asset from Formulatrix as discussed in Note 5 "Acquisitions and
Developed technology includes the digital PCR asset from Formulatrix as discussed in Note 5 "Acquisitions and
Divestitures" which is being amortized over 10 years.
Divestitures" which is being amortized over 10 years.

Developed technology includes the digital PCR asset from Formulatrix as discussed in Note 5 "Acquisitions and
Divestitures" which is being amortized over 10 years.

The changes in intangible assets for the years ended December 31, 2019 and 2018 are as follows:
The changes in intangible assets for the years ended December 31, 2019 and 2018 are as follows:

The changes in intangible assets for the years ended December 31, 2019 and 2018 are as follows:

Balance at beginning of year
Balance at beginning of year

Balance at beginning of year

Additions
Additions

Additions

Additions from acquisitions
Additions from acquisitions

Additions from acquisitions

Amortization
Amortization

Amortization

Disposals
Disposals

Disposals

Impairments
Impairments

Impairments

Foreign currency translation adjustments
Foreign currency translation adjustments

Foreign currency translation adjustments

Balance at end of year
Balance at end of year

Balance at end of year

$ 475,043
$ 475,043

$ 475,043

$ 499,318
$ 499,318

$ 499,318

286,159
286,159

286,159

32,159
32,159

32,159

36,458
36,458

36,458

81,200
81,200

81,200

(122,560)
(122,560)

(122,560)

(118,576)
(118,576)

(118,576)

—
—

—

(4,426)
(4,426)

(4,426)

(40,301)
(40,301)

(40,301)

—
—

—

(2,365)
(2,365)

(2,365)

(14,632)
(14,632)

(14,632)

$ 632,434
$ 632,434

$ 632,434

$ 475,043
$ 475,043

$ 475,043

During the year ended December 31, 2019, we recorded an impairment charge of $40.3 million related to the
During the year ended December 31, 2019, we recorded an impairment charge of $40.3 million related to the
During the year ended December 31, 2019, we recorded an impairment charge of $40.3 million related to the
171
restructuring activities discussed further in Note 6 "Restructuring and Impairments" of which $28.1 million is related
restructuring activities discussed further in Note 6 "Restructuring and Impairments" of which $28.1 million is related
restructuring activities discussed further in Note 6 "Restructuring and Impairments" of which $28.1 million is related
to patent and license rights and $12.1 million is related to developed technology. Amortization expense on
to patent and license rights and $12.1 million is related to developed technology. Amortization expense on
to patent and license rights and $12.1 million is related to developed technology. Amortization expense on

intangible assets totaled approximately $122.6 million, $118.6 million and $133.8 million, respectively, for the

intangible assets totaled approximately $122.6 million, $118.6 million and $133.8 million, respectively, for the

intangible assets totaled approximately $122.6 million, $118.6 million and $133.8 million, respectively, for the

years ended December 31, 2019, 2018 and 2017.

years ended December 31, 2019, 2018 and 2017.

years ended December 31, 2019, 2018 and 2017.

Cash paid for purchases of intangible assets during the year ended December 31, 2019 totaled $156.9 million, of

Cash paid for purchases of intangible assets during the year ended December 31, 2019 totaled $156.9 million, of

Cash paid for purchases of intangible assets during the year ended December 31, 2019 totaled $156.9 million, of

which $11.5 million is related to current year payments for licenses that were accrued as of December 31, 2018

which $11.5 million is related to current year payments for licenses that were accrued as of December 31, 2018

which $11.5 million is related to current year payments for licenses that were accrued as of December 31, 2018

and $0.5 million is related to prepayments recorded in other long-term assets in the accompanying consolidated

and $0.5 million is related to prepayments recorded in other long-term assets in the accompanying consolidated

and $0.5 million is related to prepayments recorded in other long-term assets in the accompanying consolidated

balance sheet. Intangible asset additions of $286.2 million includes $144.9 million of cash paid during the year

balance sheet. Intangible asset additions of $286.2 million includes $144.9 million of cash paid during the year

balance sheet. Intangible asset additions of $286.2 million includes $144.9 million of cash paid during the year

(in thousands)20192018(in thousands)Weighted AverageLife(in years)20192018Gross CarryingAmountAccumulatedAmortizationGross CarryingAmountAccumulatedAmortization(in thousands)20192018(in thousands)WeightedAverage Life(inyears)20192018Gross CarryingAmountAccumulatedAmortizationGross CarryingAmountAccumulatedAmortization(in thousands)20192018(in thousands)Weighted AverageLife(in years)20192018Gross CarryingAmountAccumulatedAmortizationGross CarryingAmountAccumulatedAmortization(in thousands)20192018Amortized Intangible Assets:

Amortized Intangible Assets:

Amortized Intangible Assets:

Amortized Intangible Assets:

agreements

agreements

agreements

agreements

Unamortized Intangible Assets:

Unamortized Intangible Assets:

Unamortized Intangible Assets:

Unamortized Intangible Assets:

Patent and license rights

Patent and license rights

Patent and license rights

Patent and license rights

10.19

10.19

10.19

10.19

$ 320,406

$ 320,406

$ 320,406

$ 320,406

$ (216,554)

$ (216,554)

$ (216,554)

$ (216,554)

$ 448,220

$ 448,220

$ 448,220

$ 448,220

$ (310,040)

$ (310,040)

$ (310,040)

$ (310,040)

Developed technology

Developed technology

Developed technology

Developed technology

10.96

10.96

10.96

10.96

766,966

766,966

766,966

766,966

(346,085)

(346,085)

(346,085)

(346,085)

770,955

770,955

770,955

770,955

(561,615)

(561,615)

(561,615)

(561,615)

Customer base, trademarks, and non-compete

Customer base, trademarks, and non-compete

Customer base, trademarks, and non-compete

Customer base, trademarks, and non-compete

11.68

11.68

11.68

11.68

314,638

314,638

314,638

314,638

(213,881)

(213,881)

(213,881)

(213,881)

427,512

427,512

427,512

427,512

(323,024)

(323,024)

(323,024)

(323,024)

10.95

10.95

10.95

10.95

$ 1,402,010

$ 1,402,010

$ 1,402,010

$ 1,402,010

$ (776,520)

$ (776,520)

$ (776,520)

$ (776,520)

$ 1,646,687

$ 1,646,687

$ 1,646,687

$ 1,646,687

$ (1,194,679)

$ (1,194,679)

$ (1,194,679)

$ (1,194,679)

In-process research and development

In-process research and development

In-process research and development

In-process research and development

$ 6,944

$ 6,944

$ 6,944

$ 6,944

$ 23,035

$ 23,035

$ 23,035

$ 23,035

Goodwill

Goodwill

Goodwill

Goodwill

2,140,503

2,140,503

2,140,503

2,140,503

2,108,536

2,108,536

2,108,536

2,108,536

$ 2,147,447

$ 2,147,447

$ 2,147,447

$ 2,147,447

$ 2,131,571

$ 2,131,571

$ 2,131,571

$ 2,131,571

The in-process research and development is associated to the acquisition of STAT-Dx as further discussed in Note 5

The in-process research and development is associated to the acquisition of STAT-Dx as further discussed in Note 5

The in-process research and development is associated to the acquisition of STAT-Dx as further discussed in Note 5

The in-process research and development is associated to the acquisition of STAT-Dx as further discussed in Note 5

"Acquisitions and Divestitures". The estimated fair value of acquired in-process research and development projects

"Acquisitions and Divestitures". The estimated fair value of acquired in-process research and development projects

"Acquisitions and Divestitures". The estimated fair value of acquired in-process research and development projects

"Acquisitions and Divestitures". The estimated fair value of acquired in-process research and development projects

which have not reached technological feasibility at the date of acquisition are capitalized and subsequently tested
which have not reached technological feasibility at the date of acquisition are capitalized and subsequently tested
which have not reached technological feasibility at the date of acquisition are capitalized and subsequently tested
which have not reached technological feasibility at the date of acquisition are capitalized and subsequently tested
for impairment through completion of the development process, at which point the capitalized amounts are
for impairment through completion of the development process, at which point the capitalized amounts are
for impairment through completion of the development process, at which point the capitalized amounts are
for impairment through completion of the development process, at which point the capitalized amounts are
amortized over their estimated useful life. If a project is abandoned rather than completed, all capitalized amounts
amortized over their estimated useful life. If a project is abandoned rather than completed, all capitalized amounts
amortized over their estimated useful life. If a project is abandoned rather than completed, all capitalized amounts
amortized over their estimated useful life. If a project is abandoned rather than completed, all capitalized amounts
are written-off immediately. During 2019, one development project was completed and, after testing for impairment,
are written-off immediately. During 2019, one development project was completed and, after testing for impairment,
are written-off immediately. During 2019, one development project was completed and, after testing for impairment,
are written-off immediately. During 2019, one development project was completed and, after testing for impairment,
$15.9 million of in-process research and development costs were reclassified into developed technology.
$15.9 million of in-process research and development costs were reclassified into developed technology.
$15.9 million of in-process research and development costs were reclassified into developed technology.
$15.9 million of in-process research and development costs were reclassified into developed technology.

Developed technology includes the digital PCR asset from Formulatrix as discussed in Note 5 "Acquisitions and
Developed technology includes the digital PCR asset from Formulatrix as discussed in Note 5 "Acquisitions and
Divestitures" which is being amortized over 10 years.
Divestitures" which is being amortized over 10 years.

Developed technology includes the digital PCR asset from Formulatrix as discussed in Note 5 "Acquisitions and
Developed technology includes the digital PCR asset from Formulatrix as discussed in Note 5 "Acquisitions and
Divestitures" which is being amortized over 10 years.
Divestitures" which is being amortized over 10 years.

The changes in intangible assets for the years ended December 31, 2019 and 2018 are as follows:
The changes in intangible assets for the years ended December 31, 2019 and 2018 are as follows:

The changes in intangible assets for the years ended December 31, 2019 and 2018 are as follows:
The changes in intangible assets for the years ended December 31, 2019 and 2018 are as follows:

Balance at beginning of year
Balance at beginning of year

Balance at beginning of year

Balance at beginning of year

$ 475,043
$ 475,043

$ 475,043

$ 475,043

$ 499,318
$ 499,318

$ 499,318

$ 499,318

Additions
Additions

Additions

Additions

Additions from acquisitions
Additions from acquisitions

Additions from acquisitions

Additions from acquisitions

Amortization
Amortization

Amortization

Amortization

Disposals
Disposals

Disposals

Disposals

Impairments
Impairments

Impairments

Impairments

Foreign currency translation adjustments
Foreign currency translation adjustments

Foreign currency translation adjustments

Foreign currency translation adjustments

Balance at end of year
Balance at end of year

Balance at end of year

Balance at end of year

286,159
286,159

286,159

286,159

36,458
36,458

36,458

36,458

32,159
32,159

32,159

32,159

81,200
81,200

81,200

81,200

(122,560)
(122,560)

(122,560)

(122,560)

(118,576)
(118,576)

(118,576)

(118,576)

—
—

—

—

(4,426)
(4,426)

(4,426)

(4,426)

(40,301)
(40,301)

(40,301)

(40,301)

—
—

—

—

(2,365)
(2,365)

(2,365)

(2,365)

(14,632)
(14,632)

(14,632)

(14,632)

$ 632,434
$ 632,434

$ 632,434

$ 632,434

$ 475,043
$ 475,043

$ 475,043

$ 475,043

During the year ended December 31, 2019, we recorded an impairment charge of $40.3 million related to the
During the year ended December 31, 2019, we recorded an impairment charge of $40.3 million related to the
During the year ended December 31, 2019, we recorded an impairment charge of $40.3 million related to the
During the year ended December 31, 2019, we recorded an impairment charge of $40.3 million related to the
restructuring activities discussed further in Note 6 "Restructuring and Impairments" of which $28.1 million is related
restructuring activities discussed further in Note 6 "Restructuring and Impairments" of which $28.1 million is related
restructuring activities discussed further in Note 6 "Restructuring and Impairments" of which $28.1 million is related
restructuring activities discussed further in Note 6 "Restructuring and Impairments" of which $28.1 million is related
to patent and license rights and $12.1 million is related to developed technology. Amortization expense on
to patent and license rights and $12.1 million is related to developed technology. Amortization expense on
to patent and license rights and $12.1 million is related to developed technology. Amortization expense on
to patent and license rights and $12.1 million is related to developed technology. Amortization expense on
intangible assets totaled approximately $122.6 million, $118.6 million and $133.8 million, respectively, for the
intangible assets totaled approximately $122.6 million, $118.6 million and $133.8 million, respectively, for the
intangible assets totaled approximately $122.6 million, $118.6 million and $133.8 million, respectively, for the
intangible assets totaled approximately $122.6 million, $118.6 million and $133.8 million, respectively, for the
years ended December 31, 2019, 2018 and 2017.
years ended December 31, 2019, 2018 and 2017.
years ended December 31, 2019, 2018 and 2017.
years ended December 31, 2019, 2018 and 2017.

Cash paid for purchases of intangible assets during the year ended December 31, 2019 totaled $156.9 million, of
Cash paid for purchases of intangible assets during the year ended December 31, 2019 totaled $156.9 million, of
which $11.5 million is related to current year payments for licenses that were accrued as of December 31, 2018
which $11.5 million is related to current year payments for licenses that were accrued as of December 31, 2018
and $0.5 million is related to prepayments recorded in other long-term assets in the accompanying consolidated
and $0.5 million is related to prepayments recorded in other long-term assets in the accompanying consolidated
balance sheet. Intangible asset additions of $286.2 million includes $144.9 million of cash paid during the year
balance sheet. Intangible asset additions of $286.2 million includes $144.9 million of cash paid during the year

Cash paid for purchases of intangible assets during the year ended December 31, 2019 totaled $156.9 million, of
Cash paid for purchases of intangible assets during the year ended December 31, 2019 totaled $156.9 million, of
which $11.5 million is related to current year payments for licenses that were accrued as of December 31, 2018
which $11.5 million is related to current year payments for licenses that were accrued as of December 31, 2018
and $0.5 million is related to prepayments recorded in other long-term assets in the accompanying consolidated
and $0.5 million is related to prepayments recorded in other long-term assets in the accompanying consolidated
balance sheet. Intangible asset additions of $286.2 million includes $144.9 million of cash paid during the year
balance sheet. Intangible asset additions of $286.2 million includes $144.9 million of cash paid during the year
ended December 31, 2019, together with $137.8 million of additions that were accrued as of December 31, 2019
and $3.5 million of additions which were previously recorded as prepayments.

Cash paid for intangible assets during the year ended December 31, 2018 totaled $41.0 million of which $11.9
million is related to current year payments for licenses that were accrued as of December 31, 2017 and $3.3 million
is related to prepayments recorded in other long-term assets in accompanying consolidated balance sheet. Intangible
asset additions of $32.2 million includes $25.8 million of cash paid during the year ended December 31, 2018,
together with $4.2 million of additions that were accrued as of December 31, 2018 and $2.2 million of additions
which were previously recorded as prepayments.

Amortization of intangibles for the next five years is expected to be approximately:

Years ended December 31:

2020

2021

2022

2023

2024

$ 100,891

$ 92,512

$ 78,454

$ 76,239

$ 71,910

The changes in goodwill for the years ended December 31, 2019 and 2018 are as follows:

172

Balance at beginning of year

Business combinations

Purchase adjustments

Disposals

Foreign currency translation adjustments

Balance at end of year

$ 2,108,536

$ 2,012,904

34,807

142,287

(236)

(225)

—

(5,682)

(2,379)

(40,973)

$ 2,140,503

$ 2,108,536

The changes in the carrying amount of goodwill during the year ended December 31, 2019 resulted primarily from

the acquisition of N-of-One, Inc. and other acquisitions and divestitures discussed in Note 5 "Acquisitions and

Divestitures" and changes in foreign currency translation. The changes in goodwill during the year ended December

31, 2018 resulted primarily from the acquisition of STAT-Dx and other acquisitions and divestitures also discussed in

Note 5 Note 5 "Acquisitions and Divestitures".

12. Leases

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) and additionally in July 2018, the ASU 2018-

11, Leases (Topic 842) Targeted Improvements, which superseded ASC Topic 840, Leases. The new standard

increases transparency and comparability by requiring the recognition by lessees of right-of-use (“ROU”) assets and

lease liabilities on the balance sheet for those leases classified as operating leases. Under the standard, disclosures

are required to meet the objective of enabling users of financial statements to assess the amount, timing and

uncertainty of cash flows arising from leases.

We adopted Topic 842 Leases on its effective date on January 1, 2019 and the comparative information has not

been adjusted and continues to be reported under ASC Topic 840 Leases. As a result, we changed our accounting

policy for leases as detailed below.

(in thousands)Weighted AverageLife(in years)20192018Gross CarryingAmountAccumulatedAmortizationGross CarryingAmountAccumulatedAmortization(in thousands)20192018Accounting Policies(in thousands)Amortization(in thousands)20192018(in thousands)WeightedAverage Life(inyears)20192018Gross CarryingAmountAccumulatedAmortizationGross CarryingAmountAccumulatedAmortization(in thousands)20192018(in thousands)WeightedAverage Life(inyears)20192018Gross CarryingAmountAccumulatedAmortizationGross CarryingAmountAccumulatedAmortization(in thousands)20192018(in thousands)WeightedAverage Life(inyears)20192018Gross CarryingAmountAccumulatedAmortizationGross CarryingAmountAccumulatedAmortization(in thousands)20192018ended December 31, 2019, together with $137.8 million of additions that were accrued as of December 31, 2019

ended December 31, 2019, together with $137.8 million of additions that were accrued as of December 31, 2019

ended December 31, 2019, together with $137.8 million of additions that were accrued as of December 31, 2019

ended December 31, 2019, together with $137.8 million of additions that were accrued as of December 31, 2019

ended December 31, 2019, together with $137.8 million of additions that were accrued as of December 31, 2019

and $3.5 million of additions which were previously recorded as prepayments.
and $3.5 million of additions which were previously recorded as prepayments.

and $3.5 million of additions which were previously recorded as prepayments.

and $3.5 million of additions which were previously recorded as prepayments.
and $3.5 million of additions which were previously recorded as prepayments.

F I N A N C I A L   R E S U LT S Notes to consolidated financial statements
Cash paid for intangible assets during the year ended December 31, 2018 totaled $41.0 million of which $11.9
Cash paid for intangible assets during the year ended December 31, 2018 totaled $41.0 million of which $11.9
Cash paid for intangible assets during the year ended December 31, 2018 totaled $41.0 million of which $11.9
Cash paid for intangible assets during the year ended December 31, 2018 totaled $41.0 million of which $11.9
Cash paid for intangible assets during the year ended December 31, 2018 totaled $41.0 million of which $11.9
million is related to current year payments for licenses that were accrued as of December 31, 2017 and $3.3 million
million is related to current year payments for licenses that were accrued as of December 31, 2017 and $3.3 million
million is related to current year payments for licenses that were accrued as of December 31, 2017 and $3.3 million
million is related to current year payments for licenses that were accrued as of December 31, 2017 and $3.3 million
million is related to current year payments for licenses that were accrued as of December 31, 2017 and $3.3 million
is related to prepayments recorded in other long-term assets in accompanying consolidated balance sheet. Intangible
is related to prepayments recorded in other long-term assets in accompanying consolidated balance sheet. Intangible
is related to prepayments recorded in other long-term assets in accompanying consolidated balance sheet. Intangible
is related to prepayments recorded in other long-term assets in accompanying consolidated balance sheet. Intangible
is related to prepayments recorded in other long-term assets in accompanying consolidated balance sheet. Intangible
asset additions of $32.2 million includes $25.8 million of cash paid during the year ended December 31, 2018,
asset additions of $32.2 million includes $25.8 million of cash paid during the year ended December 31, 2018,
asset additions of $32.2 million includes $25.8 million of cash paid during the year ended December 31, 2018,
asset additions of $32.2 million includes $25.8 million of cash paid during the year ended December 31, 2018,
asset additions of $32.2 million includes $25.8 million of cash paid during the year ended December 31, 2018,
together with $4.2 million of additions that were accrued as of December 31, 2018 and $2.2 million of additions
together with $4.2 million of additions that were accrued as of December 31, 2018 and $2.2 million of additions
together with $4.2 million of additions that were accrued as of December 31, 2018 and $2.2 million of additions
together with $4.2 million of additions that were accrued as of December 31, 2018 and $2.2 million of additions
together with $4.2 million of additions that were accrued as of December 31, 2018 and $2.2 million of additions
which were previously recorded as prepayments.
which were previously recorded as prepayments.
which were previously recorded as prepayments.
which were previously recorded as prepayments.
which were previously recorded as prepayments.

Amortization of intangibles for the next five years is expected to be approximately:
Amortization of intangibles for the next five years is expected to be approximately:

Amortization of intangibles for the next five years is expected to be approximately:

Amortization of intangibles for the next five years is expected to be approximately:
Amortization of intangibles for the next five years is expected to be approximately:

Years ended December 31:
Years ended December 31:

Years ended December 31:

Years ended December 31:
Years ended December 31:

2020
2020

2020

2020
2020

2021
2021

2021

2021
2021

2022
2022

2022

2022
2022

2023
2023

2023

2023
2023

2024
2024

2024

2024
2024

$ 100,891
$ 100,891

$ 100,891

$ 100,891
$ 100,891

$ 92,512
$ 92,512

$ 92,512

$ 92,512
$ 92,512

$ 78,454
$ 78,454

$ 78,454

$ 78,454
$ 78,454

$ 76,239
$ 76,239

$ 76,239

$ 76,239
$ 76,239

$ 71,910
$ 71,910

$ 71,910

$ 71,910
$ 71,910

The changes in goodwill for the years ended December 31, 2019 and 2018 are as follows:
The changes in goodwill for the years ended December 31, 2019 and 2018 are as follows:

The changes in goodwill for the years ended December 31, 2019 and 2018 are as follows:

The changes in goodwill for the years ended December 31, 2019 and 2018 are as follows:
The changes in goodwill for the years ended December 31, 2019 and 2018 are as follows:

Balance at beginning of year
Balance at beginning of year

Balance at beginning of year

Balance at beginning of year
Balance at beginning of year

Business combinations
Business combinations

Business combinations

Business combinations
Business combinations

Purchase adjustments
Purchase adjustments

Purchase adjustments

Purchase adjustments
Purchase adjustments

Disposals
Disposals

Disposals

Disposals
Disposals

Foreign currency translation adjustments
Foreign currency translation adjustments

Foreign currency translation adjustments

Foreign currency translation adjustments
Foreign currency translation adjustments

Balance at end of year
Balance at end of year

Balance at end of year

Balance at end of year
Balance at end of year

$ 2,108,536
$ 2,108,536

$ 2,108,536

$ 2,108,536
$ 2,108,536

$ 2,012,904
$ 2,012,904

$ 2,012,904

$ 2,012,904
$ 2,012,904

34,807
34,807

34,807

34,807
34,807

(236)
(236)

(236)

(236)
(236)

(225)
(225)

(225)

(225)
(225)

142,287
142,287

142,287

142,287
142,287

—
—

—

—
—

(5,682)
(5,682)

(5,682)

(5,682)
(5,682)

(2,379)
(2,379)

(2,379)

(2,379)
(2,379)

(40,973)
(40,973)

(40,973)

(40,973)
(40,973)

$ 2,140,503
$ 2,140,503

$ 2,140,503

$ 2,140,503
$ 2,140,503

$ 2,108,536
$ 2,108,536

$ 2,108,536

$ 2,108,536
$ 2,108,536

The changes in the carrying amount of goodwill during the year ended December 31, 2019 resulted primarily from
The changes in the carrying amount of goodwill during the year ended December 31, 2019 resulted primarily from
The changes in the carrying amount of goodwill during the year ended December 31, 2019 resulted primarily from
The changes in the carrying amount of goodwill during the year ended December 31, 2019 resulted primarily from
The changes in the carrying amount of goodwill during the year ended December 31, 2019 resulted primarily from
the acquisition of N-of-One, Inc. and other acquisitions and divestitures discussed in Note 5 "Acquisitions and
the acquisition of N-of-One, Inc. and other acquisitions and divestitures discussed in Note 5 "Acquisitions and
the acquisition of N-of-One, Inc. and other acquisitions and divestitures discussed in Note 5 "Acquisitions and
the acquisition of N-of-One, Inc. and other acquisitions and divestitures discussed in Note 5 "Acquisitions and
the acquisition of N-of-One, Inc. and other acquisitions and divestitures discussed in Note 5 "Acquisitions and
Divestitures" and changes in foreign currency translation. The changes in goodwill during the year ended December
Divestitures" and changes in foreign currency translation. The changes in goodwill during the year ended December
Divestitures" and changes in foreign currency translation. The changes in goodwill during the year ended December
Divestitures" and changes in foreign currency translation. The changes in goodwill during the year ended December
Divestitures" and changes in foreign currency translation. The changes in goodwill during the year ended December
31, 2018 resulted primarily from the acquisition of STAT-Dx and other acquisitions and divestitures also discussed in
31, 2018 resulted primarily from the acquisition of STAT-Dx and other acquisitions and divestitures also discussed in
31, 2018 resulted primarily from the acquisition of STAT-Dx and other acquisitions and divestitures also discussed in
31, 2018 resulted primarily from the acquisition of STAT-Dx and other acquisitions and divestitures also discussed in
31, 2018 resulted primarily from the acquisition of STAT-Dx and other acquisitions and divestitures also discussed in
Note 5 Note 5 "Acquisitions and Divestitures".
Note 5 Note 5 "Acquisitions and Divestitures".
Note 5 Note 5 "Acquisitions and Divestitures".
Note 5 Note 5 "Acquisitions and Divestitures".
Note 5 Note 5 "Acquisitions and Divestitures".

12. Leases
12. Leases

12. Leases

12. Leases
12. Leases

In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) and additionally in July 2018, the ASU 2018-
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) and additionally in July 2018, the ASU 2018-
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) and additionally in July 2018, the ASU 2018-
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) and additionally in July 2018, the ASU 2018-
In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) and additionally in July 2018, the ASU 2018-
11, Leases (Topic 842) Targeted Improvements, which superseded ASC Topic 840, Leases. The new standard
11, Leases (Topic 842) Targeted Improvements, which superseded ASC Topic 840, Leases. The new standard
11, Leases (Topic 842) Targeted Improvements, which superseded ASC Topic 840, Leases. The new standard
11, Leases (Topic 842) Targeted Improvements, which superseded ASC Topic 840, Leases. The new standard
11, Leases (Topic 842) Targeted Improvements, which superseded ASC Topic 840, Leases. The new standard
increases transparency and comparability by requiring the recognition by lessees of right-of-use (“ROU”) assets and
increases transparency and comparability by requiring the recognition by lessees of right-of-use (“ROU”) assets and
increases transparency and comparability by requiring the recognition by lessees of right-of-use (“ROU”) assets and
increases transparency and comparability by requiring the recognition by lessees of right-of-use (“ROU”) assets and
increases transparency and comparability by requiring the recognition by lessees of right-of-use (“ROU”) assets and
lease liabilities on the balance sheet for those leases classified as operating leases. Under the standard, disclosures
lease liabilities on the balance sheet for those leases classified as operating leases. Under the standard, disclosures
lease liabilities on the balance sheet for those leases classified as operating leases. Under the standard, disclosures
lease liabilities on the balance sheet for those leases classified as operating leases. Under the standard, disclosures
lease liabilities on the balance sheet for those leases classified as operating leases. Under the standard, disclosures
are required to meet the objective of enabling users of financial statements to assess the amount, timing and
are required to meet the objective of enabling users of financial statements to assess the amount, timing and
are required to meet the objective of enabling users of financial statements to assess the amount, timing and
are required to meet the objective of enabling users of financial statements to assess the amount, timing and
are required to meet the objective of enabling users of financial statements to assess the amount, timing and
uncertainty of cash flows arising from leases.
uncertainty of cash flows arising from leases.
uncertainty of cash flows arising from leases.
uncertainty of cash flows arising from leases.
uncertainty of cash flows arising from leases.

We adopted Topic 842 Leases on its effective date on January 1, 2019 and the comparative information has not
We adopted Topic 842 Leases on its effective date on January 1, 2019 and the comparative information has not
We adopted Topic 842 Leases on its effective date on January 1, 2019 and the comparative information has not
We adopted Topic 842 Leases on its effective date on January 1, 2019 and the comparative information has not
We adopted Topic 842 Leases on its effective date on January 1, 2019 and the comparative information has not
been adjusted and continues to be reported under ASC Topic 840 Leases. As a result, we changed our accounting
been adjusted and continues to be reported under ASC Topic 840 Leases. As a result, we changed our accounting
been adjusted and continues to be reported under ASC Topic 840 Leases. As a result, we changed our accounting
been adjusted and continues to be reported under ASC Topic 840 Leases. As a result, we changed our accounting
been adjusted and continues to be reported under ASC Topic 840 Leases. As a result, we changed our accounting
policy for leases as detailed below.
policy for leases as detailed below.
policy for leases as detailed below.
policy for leases as detailed below.
policy for leases as detailed below.

173

Accounting Policies(in thousands)Amortization(in thousands)20192018Accounting Policies(in thousands)Amortization(in thousands)20192018Accounting Policies(in thousands)Amortization(in thousands)20192018Accounting Policies(in thousands)Amortization(in thousands)20192018Accounting Policies(in thousands)Amortization(in thousands)20192018We implemented the standard using the required modified retrospective approach and have also elected to utilize
We implemented the standard using the required modified retrospective approach and have also elected to utilize
the package of practical expedients, which permitted us to not reassess (1) whether any expired or existing contracts
the package of practical expedients, which permitted us to not reassess (1) whether any expired or existing contracts
are or contain leases, (2) the lease classification for any expired or existing leases, and (3) any initial direct costs for
are or contain leases, (2) the lease classification for any expired or existing leases, and (3) any initial direct costs for
any existing leases as of the effective date. We also elected the practical expedient to use hindsight in determining
any existing leases as of the effective date. We also elected the practical expedient to use hindsight in determining
the appropriate lease term and in assessing impairment of its right-of-use assets. In using the modified retrospective
the appropriate lease term and in assessing impairment of its right-of-use assets. In using the modified retrospective
approach, we were required to recognize and measure leases existing at, or entered into after, the beginning of the
approach, we were required to recognize and measure leases existing at, or entered into after, the beginning of the
earliest comparative period presented.
earliest comparative period presented.

Adoption of the new standard resulted in the recording of additional net lease assets and lease liabilities of
Adoption of the new standard resulted in the recording of additional net lease assets and lease liabilities of
approximately $57.4 million and $57.7 million, respectively as of January 1, 2019. The difference between the
approximately $57.4 million and $57.7 million, respectively as of January 1, 2019. The difference between the
additional lease assets and lease liabilities was recorded as a $0.3 million adjustment to retained earnings. The
additional lease assets and lease liabilities was recorded as a $0.3 million adjustment to retained earnings. The
standard did not materially impact our consolidated income statements and had no impact on cash flows.
standard did not materially impact our consolidated income statements and had no impact on cash flows.

We have operating and finance leases for equipment, cars, machinery, other equipment, office and buildings. Our
We have operating and finance leases for equipment, cars, machinery, other equipment, office and buildings. Our
leases have remaining lease terms of 1 year to 9 years, some of which include options to extend or early renew the
leases have remaining lease terms of 1 year to 9 years, some of which include options to extend or early renew the
leases, and some of which include options to early terminate the leases. As of December 31, 2019, no such options
leases, and some of which include options to early terminate the leases. As of December 31, 2019, no such options
have been recognized as part of the right-of-use assets and lease liabilities.
have been recognized as part of the right-of-use assets and lease liabilities.

Operating leases can contain variable lease charges based on an index like consumer prices or rates. During 2019,
amounts recorded as variable lease payments not included in the operating lease liability were not material.

Operating leases can contain variable lease charges based on an index like consumer prices or rates. During 2019,
amounts recorded as variable lease payments not included in the operating lease liability were not material.

When we cannot readily determine the interest rate implicit in the operating lease contracts, we apply our
incremental borrowing rate based on information available at the commencement date in determining the present
value of lease payments. We use the implicit rate when it is readily determinable.

When we cannot readily determine the interest rate implicit in the operating lease contracts, we apply our
incremental borrowing rate based on information available at the commencement date in determining the present
value of lease payments. We use the implicit rate when it is readily determinable.

Supplemental balance sheet and other information related to leases was as follows:

Supplemental balance sheet and other information related to leases was as follows:

Operating lease right-of-use assets

Operating lease right-of-use assets

Current operating lease liabilities

Current operating lease liabilities

Long-term operating lease liabilities

Long-term operating lease liabilities

Other long-term assets

Other long-term assets

$  57,305

$  57,305

Accrued and other current liabilities

Accrued and other current liabilities

$  18,739

$  18,739

Other long-term liabilities

Other long-term liabilities

$  39,631

$  39,631

Weighted average remaining lease term - operating leases (in years)

Weighted average remaining lease term - operating leases (in years)

Weighted average discount rate - operating leases

Weighted average discount rate - operating leases

The components of lease expense were as follows:

The components of lease expense were as follows:

3.71

3.71

2.39 %

2.39 %

Operating lease cost

Operating lease cost

$  24,378

$  24,378

Supplemental cash flow information related to leases was as follows:

Supplemental cash flow information related to leases was as follows:

174

Nature of Existing Leases(in thousands, except lease term and discount rate)Location in balance sheetDecember 31, 2019(in thousands)Year Ended December31, 2019Nature of Existing Leases(in thousands, except lease term and discount rate)Location in balance sheetDecember 31, 2019(in thousands)Year Ended December31, 2019 
 
F I N A N C I A L   R E S U LT S Notes to consolidated financial statements

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows from operating leases

Right-of-use assets obtained in exchange for lease obligations:

Operating leases

Maturities of lease liabilities were as follows:

2020

2021

2022

2023

2024

Thereafter

Total lease payments(1)

Less imputed interest

Total

$ (26,113)

$ 24,670

$ 19,914

16,009

11,885

7,119

3,391

3,202

61,520

(3,150)

$ 58,370

(1)  Total lease payments exclude payments associated to the lease agreement discussed below that has not yet commenced.

As of December 31, 2019, we had an additional operating lease for a facility related primarily to research and
development that has not yet commenced but will create significant rights and obligations for the Company. The
agreement commences in 2020 with future undiscounted aggregate lease payments of $44.5 million to be paid over
a lease term of 15 years.

We did not hold any material finance leases as of December 31, 2019 or January 1, 2019.

13. Accrued and Other Current Liabilities

Accrued and other current liabilities at December 31, 2019 and 2018 consist of the following:

Accrued contingent consideration and milestone payments

(15)

$ 142,604

$ 27,820

Accrued expenses and other liabilities

Payroll and related accruals

Restructuring

Deferred revenue

Operating lease liabilities

Accrued royalties

Accrued interest on long-term debt

Cash collateral

Total accrued and other current liabilities

(6)

(4)

(12)

(22)

(16)

(14)

93,204

66,866

62,227

48,525

18,739

5,481

5,257

1,400

103,449

66,871

6,850

45,358

—

5,469

6,200

1,000

175

$ 444,303

$ 263,017

(in thousands)Year EndedDecember 31, 2019(in thousands)Operating Leases(in thousands)Note20192018 
Cash paid for amounts included in the measurement of lease liabilities:

Cash paid for amounts included in the measurement of lease liabilities:

Cash paid for amounts included in the measurement of lease liabilities:

Cash paid for amounts included in the measurement of lease liabilities:

Operating cash flows from operating leases

Operating cash flows from operating leases

Operating cash flows from operating leases

Operating cash flows from operating leases

$ (26,113)

$ (26,113)

$ (26,113)

$ (26,113)

Right-of-use assets obtained in exchange for lease obligations:

Right-of-use assets obtained in exchange for lease obligations:

Right-of-use assets obtained in exchange for lease obligations:

Right-of-use assets obtained in exchange for lease obligations:

Operating leases

Operating leases

Operating leases

Operating leases

$ 24,670

$ 24,670

$ 24,670

$ 24,670

Maturities of lease liabilities were as follows:

Maturities of lease liabilities were as follows:

Maturities of lease liabilities were as follows:

Maturities of lease liabilities were as follows:

2020

2020

2020

2020

2021

2021

2021

2021

2022

2022

2022

2022

2023

2023

2023

2023

2024

2024

2024

2024

Thereafter

Thereafter

Thereafter

Thereafter

Total lease payments(1)

Total lease payments(1)

Total lease payments(1)

Total lease payments(1)

Less imputed interest
Less imputed interest

Less imputed interest
Less imputed interest

Total
Total

Total
Total

$ 19,914

$ 19,914

$ 19,914

$ 19,914

16,009

16,009

16,009

16,009

11,885

11,885

11,885

11,885

7,119

7,119

7,119

7,119

3,391

3,391

3,391

3,391

3,202

3,202

3,202

3,202

61,520

61,520

61,520

61,520

(3,150)
(3,150)

(3,150)
(3,150)

$ 58,370
$ 58,370

$ 58,370
$ 58,370

(1)  Total lease payments exclude payments associated to the lease agreement discussed below that has not yet commenced.
(1)  Total lease payments exclude payments associated to the lease agreement discussed below that has not yet commenced.

(1)  Total lease payments exclude payments associated to the lease agreement discussed below that has not yet commenced.
(1)  Total lease payments exclude payments associated to the lease agreement discussed below that has not yet commenced.

As of December 31, 2019, we had an additional operating lease for a facility related primarily to research and
As of December 31, 2019, we had an additional operating lease for a facility related primarily to research and
As of December 31, 2019, we had an additional operating lease for a facility related primarily to research and
As of December 31, 2019, we had an additional operating lease for a facility related primarily to research and
development that has not yet commenced but will create significant rights and obligations for the Company. The
development that has not yet commenced but will create significant rights and obligations for the Company. The
development that has not yet commenced but will create significant rights and obligations for the Company. The
development that has not yet commenced but will create significant rights and obligations for the Company. The
agreement commences in 2020 with future undiscounted aggregate lease payments of $44.5 million to be paid over
agreement commences in 2020 with future undiscounted aggregate lease payments of $44.5 million to be paid over
agreement commences in 2020 with future undiscounted aggregate lease payments of $44.5 million to be paid over
agreement commences in 2020 with future undiscounted aggregate lease payments of $44.5 million to be paid over
a lease term of 15 years.
a lease term of 15 years.
a lease term of 15 years.
a lease term of 15 years.

We did not hold any material finance leases as of December 31, 2019 or January 1, 2019.
We did not hold any material finance leases as of December 31, 2019 or January 1, 2019.

We did not hold any material finance leases as of December 31, 2019 or January 1, 2019.
We did not hold any material finance leases as of December 31, 2019 or January 1, 2019.

13. Accrued and Other Current Liabilities
13. Accrued and Other Current Liabilities

13. Accrued and Other Current Liabilities
13. Accrued and Other Current Liabilities

Accrued and other current liabilities at December 31, 2019 and 2018 consist of the following:
Accrued and other current liabilities at December 31, 2019 and 2018 consist of the following:

Accrued and other current liabilities at December 31, 2019 and 2018 consist of the following:
Accrued and other current liabilities at December 31, 2019 and 2018 consist of the following:

Accrued contingent consideration and milestone payments
Accrued contingent consideration and milestone payments

Accrued contingent consideration and milestone payments
Accrued contingent consideration and milestone payments

(15)
(15)

(15)
(15)

$ 142,604
$ 142,604

$ 142,604
$ 142,604

$ 27,820
$ 27,820

$ 27,820
$ 27,820

Accrued expenses and other liabilities
Accrued expenses and other liabilities

Accrued expenses and other liabilities
Accrued expenses and other liabilities

Payroll and related accruals
Payroll and related accruals

Payroll and related accruals
Payroll and related accruals

Restructuring
Restructuring

Restructuring
Restructuring

Deferred revenue
Deferred revenue

Deferred revenue
Deferred revenue

Operating lease liabilities
Operating lease liabilities

Operating lease liabilities
Operating lease liabilities

Accrued royalties
Accrued royalties

Accrued royalties
Accrued royalties

Accrued interest on long-term debt
Accrued interest on long-term debt

Accrued interest on long-term debt
Accrued interest on long-term debt

Cash collateral
Cash collateral

Cash collateral
Cash collateral

93,204
93,204

93,204
93,204

103,449
103,449

103,449
103,449

66,866
66,866

66,866
66,866

66,871
66,871

66,871
66,871

62,227
62,227

62,227
62,227

6,850
6,850

6,850
6,850

48,525
48,525

48,525
48,525

45,358
45,358

45,358
45,358

(6)
(6)

(4)
(4)

(6)
(6)

(4)
(4)

(12)
(12)

(12)
(12)

18,739
18,739

18,739
18,739

—
—

—
—

(22)
(22)

(22)
(22)

(16)
(16)

(16)
(16)

(14)
(14)

(14)
(14)

5,481
5,481

5,481
5,481

5,469
5,469

5,469
5,469

5,257
5,257

5,257
5,257

6,200
6,200

6,200
6,200

1,400
1,400

1,400
1,400

1,000
1,000

1,000
1,000

Total accrued and other current liabilities
Total accrued and other current liabilities

Total accrued and other current liabilities
Total accrued and other current liabilities

$ 444,303
$ 444,303

$ 444,303
$ 444,303

$ 263,017
$ 263,017

$ 263,017
$ 263,017

14. Derivatives and Hedging

In the ordinary course of business, we use derivative instruments, including swaps, forwards and/or options, to
manage potential losses from foreign currency exposures and interest bearing assets or liabilities. The principal
objective of such derivative instruments is to minimize the risks and/or costs associated with our global financial and
operating activities. We do not utilize derivative or other financial instruments for trading or other speculative
purposes. We recognize all derivatives as either assets or liabilities on the balance sheet on a gross basis, measure
those instruments at fair value and recognize the change in fair value in earnings in the period of change, unless the
derivative qualifies as an effective hedge that offsets certain exposures. We have agreed with almost all of our
counterparties with whom we had entered into cross-currency swaps, interest rate swaps or foreign exchange
contracts, to enter into bilateral collateralization contracts under which we will receive or provide cash collateral, as
the case may be, for the net position with each of these counterparties. As of December 31, 2019, cash collateral
positions consisted of $1.4 million recorded in accrued and other current liabilities and $2.7 million recorded in
prepaid expenses and other current assets in the accompanying consolidated balance sheet. As of December 31,
2018, we had a liability position of $1.0 million recorded in accrued and other current liabilities and $25.4 million
recorded in prepaid expenses and other current assets in the accompanying consolidated balance sheet.

In 2017, we entered into a foreign currency non-derivative hedging instrument that is designated and qualifies as net
investment hedge. The objective of the hedge is to protect part of the net investment in foreign operations against
adverse changes in the exchange rate between the Euro and the functional currency of the U.S. dollar. The non-
derivative hedging instrument is the German private corporate bond ("Schuldschein") which was issued in the total
amount of $331.1 million as described in Note 16 "Lines of Credit and Debt". Of the $331.1 million, which is held
in both U.S. dollars and Euro, €255.0 million is designated as the hedging instrument against a portion of our Euro
net investments in our foreign operations. The relative changes in both the hedged item and hedging instrument are
calculated by applying the change in spot rate between two assessment dates against the respective notional
176
amount. The effective portion of the hedge is recorded in the cumulative translation adjustment account within other
accumulated comprehensive income (loss). Based on the spot rate method, the unrealized loss recorded in equity as

of December 31, 2019 and 2018 is $0.4 million and $5.9 million, respectively. Since we are using the debt as the

hedging instrument, which is also remeasured based on the spot rate method, there is no hedge ineffectiveness

related to the net investment hedge as of December 31, 2019 and 2018.

As of December 31, 2019 and 2018, we held derivative instruments that are designated and qualify as cash flow

hedges where the effective portion of the gain or loss on the derivative is reported as a component of other

comprehensive (loss) income and reclassified into earnings in the same period or periods during which the hedged

transaction affects earnings. Gains and losses on the derivative representing either hedge ineffectiveness or hedge

components excluded from the assessment of effectiveness are recognized in current earnings. In 2019 and in 2018,

we did not record any hedge ineffectiveness related to any cash-flow hedges in earnings. Based on their valuation as

of December 31, 2019, we expect approximately $1.9 million of derivative losses included in accumulated other

comprehensive loss will be reclassified into income during the next 12 months. The cash flows derived from

derivatives are classified in the consolidated statements of cash flows in the same category as the consolidated

balance sheet account of the underlying item.

We use interest rate derivative contracts to align our portfolio of interest bearing assets and liabilities with our risk

management objectives. During 2015, we entered into five cross currency interest rate swaps through 2025 for a

total notional amount of €180.0 million which qualify for hedge accounting as cash flow hedges. We determined

that no ineffectiveness exists related to these swaps. As of December 31, 2019 and 2018, interest receivables of

$1.5 million and $1.4 million, respectively are recorded in prepaid expenses and other current assets in the

accompanying consolidated balance sheet.

Objective and StrategyNon-Derivative Hedging InstrumentNet Investment HedgeDerivatives Designated as Hedging InstrumentsCash Flow Hedges(in thousands)Year EndedDecember 31, 2019(in thousands)Operating Leases(in thousands)Note20192018(in thousands)Year EndedDecember 31, 2019(in thousands)Operating Leases(in thousands)Note20192018(in thousands)Year EndedDecember 31, 2019(in thousands)Operating Leases(in thousands)Note20192018(in thousands)Year EndedDecember 31, 2019(in thousands)Operating Leases(in thousands)Note20192018 
 
 
 
14. Derivatives and Hedging

In the ordinary course of business, we use derivative instruments, including swaps, forwards and/or options, to

manage potential losses from foreign currency exposures and interest bearing assets or liabilities. The principal

objective of such derivative instruments is to minimize the risks and/or costs associated with our global financial and

operating activities. We do not utilize derivative or other financial instruments for trading or other speculative
purposes. We recognize all derivatives as either assets or liabilities on the balance sheet on a gross basis, measure
those instruments at fair value and recognize the change in fair value in earnings in the period of change, unless the
F I N A N C I A L   R E S U LT S Notes to consolidated financial statements
derivative qualifies as an effective hedge that offsets certain exposures. We have agreed with almost all of our
counterparties with whom we had entered into cross-currency swaps, interest rate swaps or foreign exchange
contracts, to enter into bilateral collateralization contracts under which we will receive or provide cash collateral, as
the case may be, for the net position with each of these counterparties. As of December 31, 2019, cash collateral
positions consisted of $1.4 million recorded in accrued and other current liabilities and $2.7 million recorded in
prepaid expenses and other current assets in the accompanying consolidated balance sheet. As of December 31,
2018, we had a liability position of $1.0 million recorded in accrued and other current liabilities and $25.4 million
recorded in prepaid expenses and other current assets in the accompanying consolidated balance sheet.

In 2017, we entered into a foreign currency non-derivative hedging instrument that is designated and qualifies as net
investment hedge. The objective of the hedge is to protect part of the net investment in foreign operations against
adverse changes in the exchange rate between the Euro and the functional currency of the U.S. dollar. The non-
derivative hedging instrument is the German private corporate bond ("Schuldschein") which was issued in the total
amount of $331.1 million as described in Note 16 "Lines of Credit and Debt". Of the $331.1 million, which is held
in both U.S. dollars and Euro, €255.0 million is designated as the hedging instrument against a portion of our Euro
net investments in our foreign operations. The relative changes in both the hedged item and hedging instrument are
calculated by applying the change in spot rate between two assessment dates against the respective notional
amount. The effective portion of the hedge is recorded in the cumulative translation adjustment account within other
accumulated comprehensive income (loss). Based on the spot rate method, the unrealized loss recorded in equity as
of December 31, 2019 and 2018 is $0.4 million and $5.9 million, respectively. Since we are using the debt as the
hedging instrument, which is also remeasured based on the spot rate method, there is no hedge ineffectiveness
related to the net investment hedge as of December 31, 2019 and 2018.

As of December 31, 2019 and 2018, we held derivative instruments that are designated and qualify as cash flow
hedges where the effective portion of the gain or loss on the derivative is reported as a component of other
comprehensive (loss) income and reclassified into earnings in the same period or periods during which the hedged
transaction affects earnings. Gains and losses on the derivative representing either hedge ineffectiveness or hedge
components excluded from the assessment of effectiveness are recognized in current earnings. In 2019 and in 2018,
we did not record any hedge ineffectiveness related to any cash-flow hedges in earnings. Based on their valuation as
of December 31, 2019, we expect approximately $1.9 million of derivative losses included in accumulated other
comprehensive loss will be reclassified into income during the next 12 months. The cash flows derived from
derivatives are classified in the consolidated statements of cash flows in the same category as the consolidated
balance sheet account of the underlying item.

We use interest rate derivative contracts to align our portfolio of interest bearing assets and liabilities with our risk
management objectives. During 2015, we entered into five cross currency interest rate swaps through 2025 for a
total notional amount of €180.0 million which qualify for hedge accounting as cash flow hedges. We determined
that no ineffectiveness exists related to these swaps. As of December 31, 2019 and 2018, interest receivables of
$1.5 million and $1.4 million, respectively are recorded in prepaid expenses and other current assets in the
accompanying consolidated balance sheet.

177

Objective and StrategyNon-Derivative Hedging InstrumentNet Investment HedgeDerivatives Designated as Hedging InstrumentsCash Flow HedgesAs of December 31, 2019 and 2018, we held derivative instruments that qualify for hedge accounting as fair value
hedges. For derivative instruments that are designated and qualify as a fair value hedge, the effective portion of the
gain or loss on the derivative is reflected in earnings. This effect on earnings is offset by the change in the fair value
of the hedged item attributable to the risk being hedged that is also recorded in earnings. In 2019 and 2018, we
concluded there was no ineffectiveness. The cash flows derived from derivatives are classified in the consolidated
statements of cash flows in the same category as the consolidated balance sheet account of the underlying item.

We hold interest rate swaps which effectively fixed the fair value of a portion of our fixed rate private placement
debt and qualify for hedge accounting as fair value hedges. We determined that no ineffectiveness exists related to
these swaps. As of December 31, 2019, an interest receivable of $0.1 million is recorded in prepaid and other
current assets, and as of December 31, 2018, accrued and unpaid interest of $0.1 million is recorded in accrued
and other current liabilities, respectively, in the accompanying balance sheet.

We entered into Call Options which, along with the sale of the Warrants, represent the Call Spread Overlay entered
into in connection with the Cash Convertible Notes and which are more fully described in Note 16 "Lines of Credit
and Debt". In these transactions, the Call Options are intended to address the equity price risk inherent in the cash
conversion feature of each instrument by offsetting cash payments in excess of the principal amount due upon any
conversion of the Cash Convertible Notes.

Aside from the initial payment of premiums for the Call Options, we will not be required to make any cash payments
under the Call Options. We will, however, be entitled to receive under the terms of the Call Options, an amount of
cash generally equal to the amount by which the market price per share of our common stock exceeds the exercise
price of the Call Options during the relevant valuation period. The exercise price under the Call Options is equal to
the conversion price of the Cash Convertible Notes.

The Call Options, for which our common stock is the underlying security, are derivative assets that requires mark-to-
market accounting treatment due to the cash settlement features until the Call Options settle or expire. The Call
Options are measured and reported at fair value on a recurring basis, within Level 2 of the fair value hierarchy. For
further discussion of the inputs used to determine the fair value of the Call Options, refer to Note 15 "Financial
Instruments and Fair Value Measurements".

The Call Options do not qualify for hedge accounting treatment. Therefore, the change in fair value of these
instruments is recognized immediately in our consolidated statements of income in other income (expense), net.
Because the terms of the Call Options are substantially similar to those of the Cash Convertible Notes' embedded
cash conversion option, discussed below, we expect the effect on earnings from the two derivative instruments to
mostly offset each other.

The embedded cash conversion option within the Cash Convertible Notes discussed in Note 16 "Lines of Credit and
Debt" is required to be separated from the Cash Convertible Notes and accounted for separately as a derivative
liability, with changes in fair value reported in our consolidated statements of income in other income (expense), net
until the cash conversion option settles or expires. The embedded cash conversion option is measured and reported
at fair value on a recurring basis, within Level 2 of the fair value hierarchy. For further discussion of the inputs used
to determine the fair value of the embedded cash conversion option, refer to Note 15 "Financial Instruments and Fair
Value Measurements".

178
During 2017, we purchased a convertible note for $3.0 million from a publicly listed company considered a related
party. The embedded conversion option within the convertible note is required to be separated from the convertible
note and accounted for separately as a derivative liability, with changes in fair value reported in our consolidated

Fair Value HedgesDerivatives Not Designated as Hedging InstrumentsCall OptionsCash Convertible Notes Embedded Cash Conversion OptionEmbedded Conversion OptionAs of December 31, 2019 and 2018, we held derivative instruments that qualify for hedge accounting as fair value

hedges. For derivative instruments that are designated and qualify as a fair value hedge, the effective portion of the

gain or loss on the derivative is reflected in earnings. This effect on earnings is offset by the change in the fair value

of the hedged item attributable to the risk being hedged that is also recorded in earnings. In 2019 and 2018, we

concluded there was no ineffectiveness. The cash flows derived from derivatives are classified in the consolidated

statements of cash flows in the same category as the consolidated balance sheet account of the underlying item.

We hold interest rate swaps which effectively fixed the fair value of a portion of our fixed rate private placement

debt and qualify for hedge accounting as fair value hedges. We determined that no ineffectiveness exists related to

these swaps. As of December 31, 2019, an interest receivable of $0.1 million is recorded in prepaid and other

current assets, and as of December 31, 2018, accrued and unpaid interest of $0.1 million is recorded in accrued

and other current liabilities, respectively, in the accompanying balance sheet.

We entered into Call Options which, along with the sale of the Warrants, represent the Call Spread Overlay entered

into in connection with the Cash Convertible Notes and which are more fully described in Note 16 "Lines of Credit

and Debt". In these transactions, the Call Options are intended to address the equity price risk inherent in the cash

conversion feature of each instrument by offsetting cash payments in excess of the principal amount due upon any

conversion of the Cash Convertible Notes.

Aside from the initial payment of premiums for the Call Options, we will not be required to make any cash payments

under the Call Options. We will, however, be entitled to receive under the terms of the Call Options, an amount of

cash generally equal to the amount by which the market price per share of our common stock exceeds the exercise

price of the Call Options during the relevant valuation period. The exercise price under the Call Options is equal to

the conversion price of the Cash Convertible Notes.

The Call Options, for which our common stock is the underlying security, are derivative assets that requires mark-to-

market accounting treatment due to the cash settlement features until the Call Options settle or expire. The Call

Options are measured and reported at fair value on a recurring basis, within Level 2 of the fair value hierarchy. For

further discussion of the inputs used to determine the fair value of the Call Options, refer to Note 15 "Financial

Instruments and Fair Value Measurements".

The Call Options do not qualify for hedge accounting treatment. Therefore, the change in fair value of these

instruments is recognized immediately in our consolidated statements of income in other income (expense), net.

Because the terms of the Call Options are substantially similar to those of the Cash Convertible Notes' embedded

cash conversion option, discussed below, we expect the effect on earnings from the two derivative instruments to

mostly offset each other.

The embedded cash conversion option within the Cash Convertible Notes discussed in Note 16 "Lines of Credit and
F I N A N C I A L   R E S U LT S Notes to consolidated financial statements
Debt" is required to be separated from the Cash Convertible Notes and accounted for separately as a derivative
liability, with changes in fair value reported in our consolidated statements of income in other income (expense), net
until the cash conversion option settles or expires. The embedded cash conversion option is measured and reported
at fair value on a recurring basis, within Level 2 of the fair value hierarchy. For further discussion of the inputs used
to determine the fair value of the embedded cash conversion option, refer to Note 15 "Financial Instruments and Fair
Value Measurements".

During 2017, we purchased a convertible note for $3.0 million from a publicly listed company considered a related
party. The embedded conversion option within the convertible note is required to be separated from the convertible
note and accounted for separately as a derivative liability, with changes in fair value reported in our consolidated
statements of income in other income (expense), net. The embedded cash conversion option is measured and
statements of income in other income (expense), net. The embedded cash conversion option is measured and
statements of income in other income (expense), net. The embedded cash conversion option is measured and
statements of income in other income (expense), net. The embedded cash conversion option is measured and
statements of income in other income (expense), net. The embedded cash conversion option is measured and
reported at fair value on a recurring basis, within Level 2 of the fair value hierarchy. For further discussion of the
reported at fair value on a recurring basis, within Level 2 of the fair value hierarchy. For further discussion of the
reported at fair value on a recurring basis, within Level 2 of the fair value hierarchy. For further discussion of the
reported at fair value on a recurring basis, within Level 2 of the fair value hierarchy. For further discussion of the
reported at fair value on a recurring basis, within Level 2 of the fair value hierarchy. For further discussion of the
inputs used to determine the fair value of the embedded cash conversion option, refer to Note 15 "Financial
inputs used to determine the fair value of the embedded cash conversion option, refer to Note 15 "Financial
inputs used to determine the fair value of the embedded cash conversion option, refer to Note 15 "Financial
inputs used to determine the fair value of the embedded cash conversion option, refer to Note 15 "Financial
inputs used to determine the fair value of the embedded cash conversion option, refer to Note 15 "Financial
Instruments and Fair Value Measurements".
Instruments and Fair Value Measurements".
Instruments and Fair Value Measurements".
Instruments and Fair Value Measurements".
Instruments and Fair Value Measurements".

As a globally active enterprise, we are subject to risks associated with fluctuations in foreign currencies in our
As a globally active enterprise, we are subject to risks associated with fluctuations in foreign currencies in our
As a globally active enterprise, we are subject to risks associated with fluctuations in foreign currencies in our
As a globally active enterprise, we are subject to risks associated with fluctuations in foreign currencies in our
As a globally active enterprise, we are subject to risks associated with fluctuations in foreign currencies in our
ordinary operations. This includes foreign currency-denominated receivables, payables, debt, and other balance
ordinary operations. This includes foreign currency-denominated receivables, payables, debt, and other balance
ordinary operations. This includes foreign currency-denominated receivables, payables, debt, and other balance
ordinary operations. This includes foreign currency-denominated receivables, payables, debt, and other balance
ordinary operations. This includes foreign currency-denominated receivables, payables, debt, and other balance
sheet positions including intercompany items. We manage balance sheet exposure on a group-wide basis using
sheet positions including intercompany items. We manage balance sheet exposure on a group-wide basis using
sheet positions including intercompany items. We manage balance sheet exposure on a group-wide basis using
sheet positions including intercompany items. We manage balance sheet exposure on a group-wide basis using
sheet positions including intercompany items. We manage balance sheet exposure on a group-wide basis using
foreign exchange forward contracts, foreign exchange options and cross-currency swaps.
foreign exchange forward contracts, foreign exchange options and cross-currency swaps.
foreign exchange forward contracts, foreign exchange options and cross-currency swaps.
foreign exchange forward contracts, foreign exchange options and cross-currency swaps.
foreign exchange forward contracts, foreign exchange options and cross-currency swaps.

We are party to various foreign exchange forward, option and swap arrangements which had, at December 31,
We are party to various foreign exchange forward, option and swap arrangements which had, at December 31,
We are party to various foreign exchange forward, option and swap arrangements which had, at December 31,
We are party to various foreign exchange forward, option and swap arrangements which had, at December 31,
We are party to various foreign exchange forward, option and swap arrangements which had, at December 31,
2019 and December 31, 2018, aggregate notional values of $701.4 million and $792.7 million which expire at
2019 and December 31, 2018, aggregate notional values of $701.4 million and $792.7 million which expire at
2019 and December 31, 2018, aggregate notional values of $701.4 million and $792.7 million which expire at
2019 and December 31, 2018, aggregate notional values of $701.4 million and $792.7 million which expire at
2019 and December 31, 2018, aggregate notional values of $701.4 million and $792.7 million which expire at
various dates through March 2020. The transactions have been entered into to offset the effects from short-term
various dates through March 2020. The transactions have been entered into to offset the effects from short-term
various dates through March 2020. The transactions have been entered into to offset the effects from short-term
various dates through March 2020. The transactions have been entered into to offset the effects from short-term
various dates through March 2020. The transactions have been entered into to offset the effects from short-term
balance sheet exposure to foreign currency exchange risk. Changes in the fair value of these arrangements have
balance sheet exposure to foreign currency exchange risk. Changes in the fair value of these arrangements have
balance sheet exposure to foreign currency exchange risk. Changes in the fair value of these arrangements have
balance sheet exposure to foreign currency exchange risk. Changes in the fair value of these arrangements have
balance sheet exposure to foreign currency exchange risk. Changes in the fair value of these arrangements have
been recognized in other income (expense), net.
been recognized in other income (expense), net.
been recognized in other income (expense), net.
been recognized in other income (expense), net.
been recognized in other income (expense), net.

The following table summarizes the fair value amounts of derivative instruments reported in the consolidated balance
sheets as of December 31, 2019 and 2018:

The following table summarizes the fair value amounts of derivative instruments reported in the consolidated balance
The following table summarizes the fair value amounts of derivative instruments reported in the consolidated balance
sheets as of December 31, 2019 and 2018:
sheets as of December 31, 2019 and 2018:

The following table summarizes the fair value amounts of derivative instruments reported in the consolidated balance
The following table summarizes the fair value amounts of derivative instruments reported in the consolidated balance
sheets as of December 31, 2019 and 2018:
sheets as of December 31, 2019 and 2018:

Interest rate contracts - fair value hedge (1)

Interest rate contracts - fair value hedge (1)
Interest rate contracts - fair value hedge (1)

Interest rate contracts - fair value hedge (1)
Interest rate contracts - fair value hedge (1)

Total derivative instruments designated as hedges

Total derivative instruments designated as hedges
Total derivative instruments designated as hedges

Total derivative instruments designated as hedges
Total derivative instruments designated as hedges

Embedded conversion option

Embedded conversion option
Embedded conversion option

Embedded conversion option
Embedded conversion option

Call options

Call options
Call options

Call options
Call options

Foreign exchange contracts

Foreign exchange contracts
Foreign exchange contracts

Foreign exchange contracts
Foreign exchange contracts

Total undesignated derivative instruments

Total undesignated derivative instruments
Total undesignated derivative instruments

Total undesignated derivative instruments
Total undesignated derivative instruments

$ —

$ —
$ —

$ —
$ —

$ —

$ —
$ —

$ —
$ —

$ —

$ —
$ —

$ —
$ —

$ 2,474

$ 2,474
$ 2,474

$ 2,474
$ 2,474

$ 2,474

$ 2,474
$ 2,474

$ 2,474
$ 2,474

$ —

$ —
$ —

$ —
$ —

$ —

$ —
$ —

$ —
$ —

$ —

$ —
$ —

$ —
$ —

$ —

$ —
$ —

$ —
$ —

$ —

$ —
$ —

$ —
$ —

$ —

$ —
$ —

$ —
$ —

$ 349

$ 349
$ 349

$ 349
$ 349

101,179

101,179
101,179

101,179
101,179

189,792

189,792
189,792

189,792
189,792

100,081

100,081
100,081

100,081
100,081

295,014

295,014
295,014

295,014
295,014

6,689

6,689
6,689

6,689
6,689

—

—
—

—
—

2,673

2,673
2,673

2,673
2,673

—

—
—

—
—

$ 107,868

$ 107,868
$ 107,868

$ 107,868
$ 107,868

$ 189,792

$ 189,792
$ 189,792

$ 189,792
$ 189,792

$ 102,754

$ 102,754
$ 102,754

$ 102,754
$ 102,754

$ 295,363

$ 295,363
$ 295,363

$ 295,363
$ 295,363

$ 107,868

$ 107,868
$ 107,868

$ 107,868
$ 107,868

$ 192,266

$ 192,266
$ 192,266

$ 192,266
$ 192,266

$ 102,754

$ 102,754
$ 102,754

$ 102,754
$ 102,754

$ 295,363

$ 295,363
$ 295,363

$ 295,363
$ 295,363

179

Fair Value HedgesDerivatives Not Designated as Hedging InstrumentsCall OptionsCash Convertible Notes Embedded Cash Conversion OptionEmbedded Conversion OptionForeign Exchange ContractsFair Values of Derivative Instruments(in thousands)As of December 31, 2019As of December 31, 2018Current AssetLong-Term AssetCurrent AssetLong-Term AssetAssets:Derivative instruments designated as hedgesUndesignated derivative instrumentsTotal Derivative AssetsForeign Exchange ContractsFair Values of Derivative Instruments(in thousands)As of December 31, 2019As of December 31, 2018Current AssetLong-Term AssetCurrent AssetLong-Term AssetAssets:Derivative instruments designated as hedgesUndesignated derivative instrumentsTotal Derivative AssetsForeign Exchange ContractsFair Values of Derivative Instruments(in thousands)As of December 31, 2019As of December 31, 2018Current AssetLong-Term AssetCurrent AssetLong-Term AssetAssets:Derivative instruments designated as hedgesUndesignated derivative instrumentsTotal Derivative AssetsForeign Exchange ContractsFair Values of Derivative Instruments(in thousands)As of December 31, 2019As of December 31, 2018Current AssetLong-Term AssetCurrent AssetLong-Term AssetAssets:Derivative instruments designated as hedgesUndesignated derivative instrumentsTotal Derivative AssetsForeign Exchange ContractsFair Values of Derivative Instruments(in thousands)As of December 31, 2019As of December 31, 2018Current AssetLong-Term AssetCurrent AssetLong-Term AssetAssets:Derivative instruments designated as hedgesUndesignated derivative instrumentsTotal Derivative Assets 
 
 
 
 
Interest rate contracts - cash flow hedge (1)
Interest rate contracts - cash flow hedge (1)

Interest rate contracts - cash flow hedge (1)
Interest rate contracts - cash flow hedge (1)

Interest rate contracts - fair value hedge (1)
Interest rate contracts - fair value hedge (1)

Interest rate contracts - fair value hedge (1)
Interest rate contracts - fair value hedge (1)

$ —
$ —

$ —
$ —

$ (6,027)
$ (6,027)

$ (6,027)
$ (6,027)

$ —
$ —

$ —
$ —

$ (17,574)
$ (17,574)

$ (17,574)
$ (17,574)

—
—

—
—

—
—

—
—

(473)
(473)

(473)
(473)

(721)
(721)

(721)
(721)

Total derivative instruments designated as hedges
Total derivative instruments designated as hedges

Total derivative instruments designated as hedges
Total derivative instruments designated as hedges

$ —
$ —

$ —
$ —

$ (6,027)
$ (6,027)

$ (6,027)
$ (6,027)

$  (473)
$  (473)

$  (473)
$  (473)

$  (18,295)
$  (18,295)

$  (18,295)
$  (18,295)

Cash convertible notes embedded conversion option
Cash convertible notes embedded conversion option

Cash convertible notes embedded conversion option
Cash convertible notes embedded conversion option

$ (101,361)
$ (101,361)

$ (101,361)
$ (101,361)

$ (190,902)
$ (190,902)

$ (190,902)
$ (190,902)

$ (100,164)
$ (100,164)

$ (100,164)
$ (100,164)

$ (299,098)
$ (299,098)

$ (299,098)
$ (299,098)

Foreign exchange contracts
Foreign exchange contracts

Foreign exchange contracts
Foreign exchange contracts

(1,814)
(1,814)

(1,814)
(1,814)

—
—

—
—

(5,957)
(5,957)

(5,957)
(5,957)

—
—

—
—

Total undesignated derivative instruments
Total undesignated derivative instruments

Total undesignated derivative instruments
Total undesignated derivative instruments

$ (103,175)
$ (103,175)

$ (103,175)
$ (103,175)

$ (190,902)
$ (190,902)

$ (190,902)
$ (190,902)

$ (106,121)
$ (106,121)

$ (106,121)
$ (106,121)

$ (299,098)
$ (299,098)

$ (299,098)
$ (299,098)

$ (103,175)
$ (103,175)

$ (103,175)
$ (103,175)

$ (196,929)
$ (196,929)

$ (196,929)
$ (196,929)

$ (106,594)
$ (106,594)

$ (106,594)
$ (106,594)

$ (317,393)
$ (317,393)

$ (317,393)
$ (317,393)

(1)  The fair value amounts for the interest rate contracts do not include accrued interest.
(1)  The fair value amounts for the interest rate contracts do not include accrued interest.
(1)  The fair value amounts for the interest rate contracts do not include accrued interest.
(1)  The fair value amounts for the interest rate contracts do not include accrued interest.

The following tables summarize the gains and losses on derivative instruments for the years ended December 31,
The following tables summarize the gains and losses on derivative instruments for the years ended December 31,
2019, 2018 and 2017:
2019, 2018 and 2017:

The following tables summarize the gains and losses on derivative instruments for the years ended December 31,
The following tables summarize the gains and losses on derivative instruments for the years ended December 31,
2019, 2018 and 2017:
2019, 2018 and 2017:

180

Gains and Losses on Derivative Instruments(in thousands)As of December 31, 2019As of December 31, 2018Current LiabilityLong-Term LiabilityCurrent LiabilityLong-Term LiabilityLiabilities:Derivative instruments designated as hedgesUndesignated derivative instrumentsTotal Derivative LiabilitiesGains and Losses on Derivative Instruments(in thousands)As of December 31, 2019As of December 31, 2018Current LiabilityLong-Term LiabilityCurrent LiabilityLong-Term LiabilityLiabilities:Derivative instruments designated as hedgesUndesignated derivative instrumentsTotal Derivative LiabilitiesGains and Losses on Derivative Instruments(in thousands)As of December 31, 2019As of December 31, 2018Current LiabilityLong-Term LiabilityCurrent LiabilityLong-Term LiabilityLiabilities:Derivative instruments designated as hedgesUndesignated derivative instrumentsTotal Derivative LiabilitiesGains and Losses on Derivative Instruments(in thousands)As of December 31, 2019As of December 31, 2018Current LiabilityLong-Term LiabilityCurrent LiabilityLong-Term LiabilityLiabilities:Derivative instruments designated as hedgesUndesignated derivative instrumentsTotal Derivative Liabilities 
 
 
 
F I N A N C I A L   R E S U LT S Notes to consolidated financial statements

Total amounts presented in the Consolidated Statements of Income in which the
effects of cash flow and fair value hedges are recorded

Total amounts presented in the Consolidated Statements of Income in which the
Total amounts presented in the Consolidated Statements of Income in which the
Total amounts presented in the Consolidated Statements of Income in which the
effects of cash flow and fair value hedges are recorded
effects of cash flow and fair value hedges are recorded
effects of cash flow and fair value hedges are recorded

Total amounts presented in the Consolidated Statements of Income in which the
effects of cash flow and fair value hedges are recorded

$ 432

$ 432
$ 432
$ 432

$ 432

$  5,598

$  5,598
$  5,598
$  5,598

$  5,598

$  (4)

$  (4)
$  (4)
$  (4)

$  (4)

Total amounts presented in the Consolidated Statements of Income in which the
effects of cash flow and fair value hedges are recorded

Total amounts presented in the Consolidated Statements of Income in which the
effects of cash flow and fair value hedges are recorded

$ 432

$ 432

$  5,598

$  5,598

$  (4)

$  (4)

Interest rate contracts

Interest rate contracts
Interest rate contracts
Interest rate contracts

Interest rate contracts

Amount of (loss) gain reclassified from accumulated other comprehensive income
Amount of (loss) gain reclassified from accumulated other comprehensive income
Amount of (loss) gain reclassified from accumulated other comprehensive income

Amount of (loss) gain reclassified from accumulated other comprehensive income

Amount of (loss) gain reclassified from accumulated other comprehensive income
Interest rate contracts

Interest rate contracts

$ (3,888)

$ (3,888)
$ (3,888)
$ (3,888)

$ (3,888)

$ (9,774)

$ (9,774)
$ (9,774)
$ (9,774)

$ (9,774)

$ 26,136

$ 26,136
$ 26,136
$ 26,136

$ 26,136

Amounts excluded from effectiveness testing
Amount of (loss) gain reclassified from accumulated other comprehensive income

Amounts excluded from effectiveness testing
Amounts excluded from effectiveness testing
Amounts excluded from effectiveness testing
Amount of (loss) gain reclassified from accumulated other comprehensive income

Amounts excluded from effectiveness testing

—
—
—
—
$ (3,888)
$ (3,888)

—

—
—
—
—
$ (9,774)
$ (9,774)

—

—
—
—
—
$ 26,136
$ 26,136

—

Amounts excluded from effectiveness testing

Amounts excluded from effectiveness testing

—

—

—

—

—

—

Interest rate contracts

Interest rate contracts
Interest rate contracts
Interest rate contracts

Interest rate contracts

Hedged item
Hedged item
Hedged item
Hedged item
Hedged item
Interest rate contracts
Interest rate contracts

Derivatives designated as hedging instruments
Hedged item

Derivatives designated as hedging instruments
Derivatives designated as hedging instruments
Derivatives designated as hedging instruments
Hedged item

Derivatives designated as hedging instruments

(3,668)

(3,668)
(3,668)
(3,668)

(3,668)

2,051

2,051
2,051
2,051

2,051

2,199

2,199
2,199
2,199

2,199

3,668
(3,668)

3,668
3,668
3,668
(3,668)

3,668

(2,051)
2,051

(2,051)
(2,051)
(2,051)
2,051

(2,051)

(2,199)
2,199

(2,199)
(2,199)
(2,199)
2,199

(2,199)

Derivatives designated as hedging instruments

Derivatives designated as hedging instruments

3,668

3,668

(2,051)

(2,051)

(2,199)

(2,199)

Embedded conversion option

Embedded conversion option
Embedded conversion option
Embedded conversion option

Embedded conversion option

(349)

(349)
(349)
(349)

(349)

131

131
131
131

131

217

217
217
217

217

Call options
Call options
Embedded conversion option

Call options
Call options
Call options
Embedded conversion option

(104,125)
(104,125)
(104,125)
(104,125)
(104,125)
(349)
(349)

74,682
74,682
74,682
74,682
131
131

74,682

37,414
37,414
37,414
37,414
217
217

37,414

Cash convertible notes embedded cash conversion option
Call options

Cash convertible notes embedded cash conversion option
Cash convertible notes embedded cash conversion option
Cash convertible notes embedded cash conversion option
Call options

Cash convertible notes embedded cash conversion option

Foreign exchange contracts
Cash convertible notes embedded cash conversion option

Foreign exchange contracts
Foreign exchange contracts
Foreign exchange contracts
Cash convertible notes embedded cash conversion option

Foreign exchange contracts

106,998
(104,125)

106,998
106,998
106,998
(104,125)

106,998

(76,500)
74,682

(76,500)
(76,500)
(76,500)
74,682

(76,500)

(36,741)
37,414

(36,741)
(36,741)
(36,741)
37,414

(36,741)

1,835
106,998

1,835
1,835
1,835
106,998

1,835

(19,857)
(76,500)

(19,857)
(19,857)
(19,857)
(76,500)

(19,857)

11,813
(36,741)

11,813
11,813
11,813
(36,741)

11,813

Foreign exchange contracts

Foreign exchange contracts

1,835

1,835

(19,857)

(19,857)

11,813

11,813

$ 471

$ 471
$ 471
$ 471

$ 471

$ (31,318)

$ (31,318)
$ (31,318)
$ (31,318)

$ (31,318)

$ 38,839

$ 38,839
$ 38,839
$ 38,839

$ 38,839

The following tables summarizes the balance sheet line items in which the hedged item is included as of December
31, 2019 and 2018:

The following tables summarizes the balance sheet line items in which the hedged item is included as of December
31, 2019 and 2018:
The following tables summarizes the balance sheet line items in which the hedged item is included as of December
31, 2019 and 2018:

The following tables summarizes the balance sheet line items in which the hedged item is included as of December
The following tables summarizes the balance sheet line items in which the hedged item is included as of December
The following tables summarizes the balance sheet line items in which the hedged item is included as of December
31, 2019 and 2018:
31, 2019 and 2018:
31, 2019 and 2018:
The following tables summarizes the balance sheet line items in which the hedged item is included as of December
31, 2019 and 2018:

$ 471

$ 471

$ (31,318)

$ (31,318)

$ 38,839

$ 38,839

Current portion of long-term debt

Current portion of long-term debt
Current portion of long-term debt
Current portion of long-term debt

Current portion of long-term debt

$ —

$ —
$ —
$ —

$ —

$  (72,483)

$  (72,483)
$  (72,483)
$  (72,483)

$  (72,483)

$ —

$ —
$ —
$ —

$ —

$  (473)

$  (473)
$  (473)
$  (473)

$  (473)

Long-term debt
Long-term debt
Current portion of long-term debt

Long-term debt
Long-term debt
Long-term debt
Current portion of long-term debt

$ (129,290)
$ (129,290)
$ (129,290)
$ (129,290)
$ (129,290)
$ —
$ —

$  (126,030)
$  (72,483)

$  (126,030)
$  (126,030)
$  (126,030)
$  (72,483)

$  (126,030)

$ 2,474
$ 2,474
$ 2,474
$ 2,474
$ 2,474
$ —
$ —

$  (721)
$  (473)

$  (721)
$  (721)
$  (721)
$  (473)

$  (721)

Long-term debt

Long-term debt

$ (129,290)

$ (129,290)

$  (126,030)

$  (126,030)

$ 2,474

$ 2,474

$  (721)

$  (721)

15. Financial Instruments and Fair Value Measurements

15. Financial Instruments and Fair Value Measurements
15. Financial Instruments and Fair Value Measurements
Assets and liabilities are measured at fair value according to a three-tier fair value hierarchy which prioritizes the
inputs used in measuring fair value as follows:
Assets and liabilities are measured at fair value according to a three-tier fair value hierarchy which prioritizes the
inputs used in measuring fair value as follows:
Level 1. Observable inputs, such as quoted prices in active markets;

15. Financial Instruments and Fair Value Measurements
15. Financial Instruments and Fair Value Measurements
15. Financial Instruments and Fair Value Measurements
15. Financial Instruments and Fair Value Measurements
Assets and liabilities are measured at fair value according to a three-tier fair value hierarchy which prioritizes the
Assets and liabilities are measured at fair value according to a three-tier fair value hierarchy which prioritizes the
Assets and liabilities are measured at fair value according to a three-tier fair value hierarchy which prioritizes the
inputs used in measuring fair value as follows:
inputs used in measuring fair value as follows:
inputs used in measuring fair value as follows:
Assets and liabilities are measured at fair value according to a three-tier fair value hierarchy which prioritizes the
inputs used in measuring fair value as follows:
Level 1. Observable inputs, such as quoted prices in active markets;
Level 1. Observable inputs, such as quoted prices in active markets;
Level 1. Observable inputs, such as quoted prices in active markets;

Assets and liabilities are measured at fair value according to a three-tier fair value hierarchy which prioritizes the
inputs used in measuring fair value as follows:

Level 1. Observable inputs, such as quoted prices in active markets;

Level 1. Observable inputs, such as quoted prices in active markets;
Level 2. Inputs, other than the quoted price in active markets, that are observable either directly or indirectly; and

Level 1. Observable inputs, such as quoted prices in active markets;
Level 2. Inputs, other than the quoted price in active markets, that are observable either directly or indirectly; and
Level 2. Inputs, other than the quoted price in active markets, that are observable either directly or indirectly; and
Level 2. Inputs, other than the quoted price in active markets, that are observable either directly or indirectly; and

Level 2. Inputs, other than the quoted price in active markets, that are observable either directly or indirectly; and

181

Level 2. Inputs, other than the quoted price in active markets, that are observable either directly or indirectly; and

Level 2. Inputs, other than the quoted price in active markets, that are observable either directly or indirectly; and

Balance Sheet Line Items in which the Hedged Item is included(in thousands)Year ended December 31,201920182017Other income(expense), netOther income(expense), netOther income(expense), netGains (Losses) on Derivatives in Cash Flow HedgesGains (Losses) on Derivatives in Fair Value HedgesGains (Losses) Derivatives Not Designated as Hedging InstrumentsTotal gains (losses)(in thousands)Carrying Amount of the Hedged Assets(Liabilities)Cumulative Amount of Fair Value HedgingAdjustment Included in the Carrying Amount ofHedged Assets (Liabilities)December 31, 2019December 31, 2018December 31, 2019December 31, 2018Balance Sheet Line Items in which the Hedged Item is included(in thousands)Year ended December 31,201920182017Other income(expense), netOther income(expense), netOther income(expense), netGains (Losses) on Derivatives in Cash Flow HedgesGains (Losses) on Derivatives in Fair Value HedgesGains (Losses) Derivatives Not Designated as Hedging InstrumentsTotal gains (losses)(in thousands)Carrying Amount of the Hedged Assets(Liabilities)Cumulative Amount of Fair Value HedgingAdjustment Included in the Carrying Amount ofHedged Assets (Liabilities)December 31, 2019December 31, 2018December 31, 2019December 31, 2018Balance Sheet Line Items in which the Hedged Item is included(in thousands)Year ended December 31,201920182017Other income(expense), netOther income(expense), netOther income(expense), netGains (Losses) on Derivatives in Cash Flow HedgesGains (Losses) on Derivatives in Fair Value HedgesGains (Losses) Derivatives Not Designated as Hedging InstrumentsTotal gains (losses)(in thousands)Carrying Amount of the Hedged Assets(Liabilities)Cumulative Amount of Fair Value HedgingAdjustment Included in the Carrying Amount ofHedged Assets (Liabilities)December 31, 2019December 31, 2018December 31, 2019December 31, 2018Balance Sheet Line Items in which the Hedged Item is included(in thousands)Year ended December 31,201920182017Other income(expense), netOther income(expense), netOther income(expense), netGains (Losses) on Derivatives in Cash Flow HedgesGains (Losses) on Derivatives in Fair Value HedgesGains (Losses) Derivatives Not Designated as Hedging InstrumentsTotal gains (losses)(in thousands)Carrying Amount of the Hedged Assets(Liabilities)Cumulative Amount of Fair Value HedgingAdjustment Included in the Carrying Amount ofHedged Assets (Liabilities)December 31, 2019December 31, 2018December 31, 2019December 31, 2018Balance Sheet Line Items in which the Hedged Item is included(in thousands)Year ended December 31,201920182017Other income(expense), netOther income(expense), netOther income(expense), netGains (Losses) on Derivatives in Cash Flow HedgesGains (Losses) on Derivatives in Fair Value HedgesGains (Losses) Derivatives Not Designated as Hedging InstrumentsTotal gains (losses)(in thousands)Carrying Amount of the Hedged Assets(Liabilities)Cumulative Amount of Fair Value HedgingAdjustment Included in the Carrying Amount ofHedged Assets (Liabilities)December 31, 2019December 31, 2018December 31, 2019December 31, 2018Balance Sheet Line Items in which the Hedged Item is included(in thousands)Year ended December 31,201920182017Other income(expense), netOther income(expense), netOther income(expense), netGains (Losses) on Derivatives in Cash Flow HedgesGains (Losses) on Derivatives in Fair Value HedgesGains (Losses) Derivatives Not Designated as Hedging InstrumentsTotal gains (losses)(in thousands)Carrying Amount of the Hedged Assets(Liabilities)Cumulative Amount of Fair Value HedgingAdjustment Included in the Carrying Amount ofHedged Assets (Liabilities)December 31, 2019December 31, 2018December 31, 2019December 31, 2018Balance Sheet Line Items in which the Hedged Item is included(in thousands)Year ended December 31,201920182017Other income(expense), netOther income(expense), netOther income(expense), netGains (Losses) on Derivatives in Cash Flow HedgesGains (Losses) on Derivatives in Fair Value HedgesGains (Losses) Derivatives Not Designated as Hedging InstrumentsTotal gains (losses)(in thousands)Carrying Amount of the Hedged Assets(Liabilities)Cumulative Amount of Fair Value HedgingAdjustment Included in the Carrying Amount ofHedged Assets (Liabilities)December 31, 2019December 31, 2018December 31, 2019December 31, 2018 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total amounts presented in the Consolidated Statements of Income in which the

$ 432

$  5,598

$  (4)

effects of cash flow and fair value hedges are recorded

Interest rate contracts

Amount of (loss) gain reclassified from accumulated other comprehensive income

$ (3,888)

$ (9,774)

$ 26,136

Amounts excluded from effectiveness testing

—

—

—

Interest rate contracts

Hedged item

Derivatives designated as hedging instruments

Embedded conversion option

Call options

Cash convertible notes embedded cash conversion option

Foreign exchange contracts

(3,668)

3,668

2,051

(2,051)

2,199

(2,199)

(349)

(104,125)

106,998

1,835

131

74,682

(76,500)

(19,857)

217

37,414

(36,741)

11,813

$ 471

$ (31,318)

$ 38,839

The following tables summarizes the balance sheet line items in which the hedged item is included as of December

31, 2019 and 2018:

Current portion of long-term debt

$ —

$  (72,483)

Long-term debt

$ (129,290)

$  (126,030)

$ —

$ 2,474

$  (473)

$  (721)

15. Financial Instruments and Fair Value Measurements

Assets and liabilities are measured at fair value according to a three-tier fair value hierarchy which prioritizes the
inputs used in measuring fair value as follows:

Level 1. Observable inputs, such as quoted prices in active markets;

Level 2. Inputs, other than the quoted price in active markets, that are observable either directly or indirectly; and

Level 3. Unobservable inputs in which there is little or no market data, which require the reporting entity to develop
its own assumptions.

Our assets and liabilities measured at fair value on a recurring basis consist of short-term investments, which are
classified in Level 1 and Level 2 of the fair value hierarchy, marketable securities discussed in Note 10 "Investments",
which are classified in Level 1, derivative contracts used to hedge currency and interest rate risk and derivative
financial instruments entered into in connection with the Cash Convertible Notes discussed in Note 16 "Lines of
Credit and Debt", which are classified in Level 2 of the fair value hierarchy, and contingent consideration accruals
which are classified in Level 3 of the fair value hierarchy, and are shown in the tables below. Non-marketable equity
securities remeasured during the year ended December 31, 2019 and 2018 are classified within Level 3 in the fair
value hierarchy following the adoption of ASU 2016-01. There were no transfers between levels for the year ended
December 31, 2019.

In determining fair value for Level 2 instruments, we apply a market approach, using quoted active market prices
relevant to the particular instrument under valuation, giving consideration to the credit risk of both the respective
counterparty to the contract and the Company. To determine our credit risk, we estimated our credit rating by
benchmarking the price of outstanding debt to publicly-available comparable data from rated companies. Using the
estimated rating, our credit risk was quantified by reference to publicly-traded debt with a corresponding rating. The
Level 2 derivative financial instruments include the Call Options asset and the embedded conversion option liability.
See Note 16 "Lines of Credit and Debt", and Note 14 "Derivatives and Hedging", for further information. The
derivatives are not actively traded and are valued based on an option pricing model that uses observable market
data for inputs. Significant market data inputs used to determine fair values included our common stock price, the
risk-free interest rate, and the implied volatility of our common stock. The Call Options asset and the embedded cash
conversion option liability were designed with the intent that changes in their fair values would substantially offset,
with limited net impact to our earnings. Therefore, the sensitivity of changes in the unobservable inputs to the option
pricing model for such instruments is substantially mitigated.

Our Level 3 instruments include non-marketable equity security investments for which we estimate the value based on
valuation methods using the observable transaction price at the transaction date and other unobservable inputs.
These investments are carried at fair value or under the measurement alternative. Under the measurement alternative,
the carrying value is measured at cost, less any impairment, plus or minus changes resulting from observable price
changes in orderly transactions for identical or similar investments of the same issuer. Adjustments are determined
primarily based on a market approach as of the transaction date.

Our Level 3 instruments also include contingent consideration liabilities. We value contingent consideration liabilities
using unobservable inputs, applying the income approach, such as the discounted cash flow technique, or the
probability-weighted scenario method. Contingent consideration arrangements obligate us to pay the sellers of an
acquired entity if specified future events occur or conditions are met such as the achievement of technological or
revenue milestones. We use various key assumptions, such as the probability of achievement of the milestones (0% to
100%) and the discount rate (between 2.4% and 6.9%), to represent the non-performing risk factors and time value
when applying the income approach. We regularly review the fair value of the contingent consideration, and reflect
any change in the accrual in the consolidated statements of income in the line items commensurate with the
underlying nature of milestone arrangements.

182
The following table presents our fair value hierarchy for our financial assets and liabilities measured at fair value on
a recurring basis:

Balance Sheet Line Items in which the Hedged Item is included(in thousands)Year ended December 31,201920182017Other income(expense), netOther income(expense), netOther income(expense), netGains (Losses) on Derivatives in Cash Flow HedgesGains (Losses) on Derivatives in Fair Value HedgesGains (Losses) Derivatives Not Designated as Hedging InstrumentsTotal gains (losses)(in thousands)Carrying Amount of the Hedged Assets(Liabilities)Cumulative Amount of Fair Value HedgingAdjustment Included in the Carrying Amount ofHedged Assets (Liabilities)December 31, 2019December 31, 2018December 31, 2019December 31, 2018 
 
 
 
Level 3. Unobservable inputs in which there is little or no market data, which require the reporting entity to develop

its own assumptions.

Our assets and liabilities measured at fair value on a recurring basis consist of short-term investments, which are

classified in Level 1 and Level 2 of the fair value hierarchy, marketable securities discussed in Note 10 "Investments",

which are classified in Level 1, derivative contracts used to hedge currency and interest rate risk and derivative

financial instruments entered into in connection with the Cash Convertible Notes discussed in Note 16 "Lines of

Credit and Debt", which are classified in Level 2 of the fair value hierarchy, and contingent consideration accruals

which are classified in Level 3 of the fair value hierarchy, and are shown in the tables below. Non-marketable equity

securities remeasured during the year ended December 31, 2019 and 2018 are classified within Level 3 in the fair

value hierarchy following the adoption of ASU 2016-01. There were no transfers between levels for the year ended

December 31, 2019.

In determining fair value for Level 2 instruments, we apply a market approach, using quoted active market prices

relevant to the particular instrument under valuation, giving consideration to the credit risk of both the respective

counterparty to the contract and the Company. To determine our credit risk, we estimated our credit rating by

benchmarking the price of outstanding debt to publicly-available comparable data from rated companies. Using the

estimated rating, our credit risk was quantified by reference to publicly-traded debt with a corresponding rating. The

Level 2 derivative financial instruments include the Call Options asset and the embedded conversion option liability.

See Note 16 "Lines of Credit and Debt", and Note 14 "Derivatives and Hedging", for further information. The

derivatives are not actively traded and are valued based on an option pricing model that uses observable market

data for inputs. Significant market data inputs used to determine fair values included our common stock price, the

risk-free interest rate, and the implied volatility of our common stock. The Call Options asset and the embedded cash

conversion option liability were designed with the intent that changes in their fair values would substantially offset,

with limited net impact to our earnings. Therefore, the sensitivity of changes in the unobservable inputs to the option

pricing model for such instruments is substantially mitigated.

F I N A N C I A L   R E S U LT S Notes to consolidated financial statements
Our Level 3 instruments include non-marketable equity security investments for which we estimate the value based on
valuation methods using the observable transaction price at the transaction date and other unobservable inputs.
These investments are carried at fair value or under the measurement alternative. Under the measurement alternative,
the carrying value is measured at cost, less any impairment, plus or minus changes resulting from observable price
changes in orderly transactions for identical or similar investments of the same issuer. Adjustments are determined
primarily based on a market approach as of the transaction date.

Our Level 3 instruments also include contingent consideration liabilities. We value contingent consideration liabilities
using unobservable inputs, applying the income approach, such as the discounted cash flow technique, or the
probability-weighted scenario method. Contingent consideration arrangements obligate us to pay the sellers of an
acquired entity if specified future events occur or conditions are met such as the achievement of technological or
revenue milestones. We use various key assumptions, such as the probability of achievement of the milestones (0% to
100%) and the discount rate (between 2.4% and 6.9%), to represent the non-performing risk factors and time value
when applying the income approach. We regularly review the fair value of the contingent consideration, and reflect
any change in the accrual in the consolidated statements of income in the line items commensurate with the
underlying nature of milestone arrangements.

The following table presents our fair value hierarchy for our financial assets and liabilities measured at fair value on
a recurring basis:

Short-term
investments

Short-term
Short-term
Short-term
Short-term
Short-term
Marketable equity
Short-term
Short-term
Short-term
Short-term
Short-term
investments
investments
investments
investments
investments
securities
investments
investments
investments
investments
investments

Marketable equity
Marketable equity
Marketable equity
Marketable equity
Marketable equity
Non-marketable
Marketable equity
Marketable equity
Marketable equity
Marketable equity
Marketable equity
securities
securities
securities
securities
securities
equity securities
securities
securities
securities
securities
securities

Non-marketable
Non-marketable
Non-marketable
Non-marketable
Non-marketable
Call option
Non-marketable
Non-marketable
Non-marketable
Non-marketable
Non-marketable
equity securities
equity securities
equity securities
equity securities
equity securities
equity securities
equity securities
equity securities
equity securities
equity securities
Foreign exchange
Call option
Call option
Call option
Call option
Call option
contracts
Call option
Call option
Call option
Call option
Call option

Foreign exchange
Foreign exchange
Foreign exchange
Foreign exchange
Foreign exchange
Embedded
Foreign exchange
Foreign exchange
Foreign exchange
Foreign exchange
Foreign exchange
contracts
contracts
contracts
contracts
contracts
conversion option
contracts
contracts
contracts
contracts
contracts

Embedded
Embedded
Embedded
Embedded
Embedded
Interest rate
Embedded
Embedded
Embedded
Embedded
Embedded
conversion option
conversion option
conversion option
conversion option
conversion option
contracts
conversion option
conversion option
conversion option
conversion option
conversion option

Interest rate
Interest rate
Interest rate
Interest rate
Interest rate
Interest rate
Interest rate
Interest rate
Interest rate
Interest rate
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts

Foreign exchange
contracts

Foreign exchange
Foreign exchange
Foreign exchange
Foreign exchange
Foreign exchange
Interest rate
Foreign exchange
Foreign exchange
Foreign exchange
Foreign exchange
Foreign exchange
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts
contracts

Interest rate
Interest rate
Interest rate
Interest rate
Interest rate
Cash conversion
Interest rate
Interest rate
Interest rate
Interest rate
Interest rate
contracts
contracts
contracts
contracts
contracts
option
contracts
contracts
contracts
contracts
contracts

Cash conversion
Cash conversion
Cash conversion
Cash conversion
Cash conversion
Contingent
Cash conversion
Cash conversion
Cash conversion
Cash conversion
Cash conversion
option
option
option
option
option
consideration
option
option
option
option
option

Contingent
Contingent
Contingent
Contingent
Contingent
Contingent
Contingent
Contingent
Contingent
Contingent
consideration
consideration
consideration
consideration
consideration
consideration
consideration
consideration
consideration
consideration

$ —

$ 129,586

$ —

$ 129,586

$ 350

$ 234,256

$ —

$ 234,606

$  —
870
$ —

$  —
$  —
$  —
$  —
$ —
$ —
$ —
$ —

$ 129,586
$ 129,586
$ 129,586
$ 129,586
$ 129,586
—
$ 129,586
$ 129,586
$ 129,586
$ 129,586
$ 129,586

$ —
$ —
$ —
$ —
$ —
—
$ —
$ —
$ —
$ —
$ —

$ 129,586
$ 129,586
$ 129,586
$ 129,586
$ 129,586
870
$ 129,586
$ 129,586
$ 129,586
$ 129,586
$ 129,586

$ 350
2,117
$ 350

$ 350
$ 350
$ 350
$ 350
$ 350
$ 350
$ 350
$ 350

$ 234,256
$ 234,256
$ 234,256
$ 234,256
$ 234,256
—
$ 234,256
$ 234,256
$ 234,256
$ 234,256
$ 234,256

$ —
$ —
$ —
$ —
$ —
—
$ —
$ —
$ —
$ —
$ —

$ 234,606
$ 234,606
$ 234,606
$ 234,606
$ 234,606
2,117
$ 234,606
$ 234,606
$ 234,606
$ 234,606
$ 234,606

870
870
870
870
870
—
870
870
870
870
870

—
—
—

—
—
—
—
—
—
—
—

—
70,849
—

—
—
—
—
—
—
—
—

870
70,849
870

870
870
870
870
870
870
870
870

2,117
2,117
2,117
2,117
2,117
—
2,117
2,117
2,117
2,117
2,117

—
—
—

—
—
—
—
—
—
—
—

—
59,484
—

—
—
—
—
—
—
—
—

2,117
59,484
2,117

2,117
2,117
2,117
2,117
2,117
2,117
2,117
2,117

—
—
—

—
—
—
—
—
—
—
—

—
290,971
—

—
—
—
—
—
—
—
—

70,849
70,849
70,849
70,849
70,849
—
70,849
70,849
70,849
70,849
70,849

70,849
290,971
70,849

70,849
70,849
70,849
70,849
70,849
70,849
70,849
70,849

—
—
—

—
—
—
—
—
—
—
—

—
395,095
—

—
—
—
—
—
—
—
—

59,484
59,484
59,484
59,484
59,484
—
59,484
59,484
59,484
59,484
59,484

59,484
395,095
59,484

59,484
59,484
59,484
59,484
59,484
59,484
59,484
59,484

—
—
—

—
—
—
—
—
—
—
—

6,689
290,971
290,971
290,971
290,971
290,971
290,971
290,971
290,971
290,971
290,971

—
—
—

—
—
—
—
—
—
—
—

6,689
290,971
290,971
290,971
290,971
290,971
290,971
290,971
290,971
290,971
290,971

—
—
—

—
—
—
—
—
—
—
—

2,673
395,095
395,095
395,095
395,095
395,095
395,095
395,095
395,095
395,095
395,095

—
—
—

—
—
—
—
—
—
—
—

2,673
395,095
395,095
395,095
395,095
395,095
395,095
395,095
395,095
395,095
395,095

—
—
—

—
—
—
—
—
—
—
—

6,689
6,689
6,689
6,689
6,689
—
6,689
6,689
6,689
6,689
6,689

—
—
—

—
—
—
—
—
—
—
—

6,689
6,689
6,689
6,689
6,689
—
6,689
6,689
6,689
6,689
6,689

—
—
—

—
—
—
—
—
—
—
—

2,673
2,673
2,673
2,673
2,673
349
2,673
2,673
2,673
2,673
2,673

—
—
—

—
—
—
—
—
—
—
—

2,673
2,673
2,673
2,673
2,673
349
2,673
2,673
2,673
2,673
2,673

—
—
—

—
—
—
—
—
—
—
—

—
2,474
—

—
—
—
—
—
—
—
—

—
—
—

—
—
—
—
—
—
—
—

—
2,474
—

—
—
—
—
—
—
—
—

—
—
—

—
—
—
—
—
—
—
—

349
349
349
349
349
—
349
349
349
349
349

—
—
—

—
—
—
—
—
—
—
—

349
349
349
349
349
—
349
349
349
349
349

—
—
$ 870

—
—
—
—
—
—
—
—

2,474
2,474
$ 429,720

2,474
2,474
2,474
2,474
2,474
2,474
2,474
2,474

—
—
$ 70,849

—
—
—
—
—
—
—
—

2,474
2,474
$ 501,439

2,474
2,474
2,474
2,474
2,474
2,474
2,474
2,474

—
—
$ 2,467

—
—
—
—
—
—
—
—

—
—
$ 632,373

—
—
—
—
—
—
—
—

—
—
$ 59,484

—
—
—
—
—
—
—
—

—
—
$ 694,324

—
—
—
—
—
—
—
—

$ 870
$ 870

$ 870
$ 870
$ 870
$ 870
$ 870
$ 870
$ 870
$ 870

$ 429,720
$ 429,720

$ 429,720
$ 429,720
$ 429,720
$ 429,720
$ 429,720
$ 429,720
$ 429,720
$ 429,720

$ 70,849
$ 70,849

$ 70,849
$ 70,849
$ 70,849
$ 70,849
$ 70,849
$ 70,849
$ 70,849
$ 70,849

$ 501,439
$ 501,439

$ 501,439
$ 501,439
$ 501,439
$ 501,439
$ 501,439
$ 501,439
$ 501,439
$ 501,439

$ 2,467
$ 2,467

$ 2,467
$ 2,467
$ 2,467
$ 2,467
$ 2,467
$ 2,467
$ 2,467
$ 2,467

$ 632,373
$ 632,373

$ 632,373
$ 632,373
$ 632,373
$ 632,373
$ 632,373
$ 632,373
$ 632,373
$ 632,373

$ 59,484
$ 59,484

$ 59,484
$ 59,484
$ 59,484
$ 59,484
$ 59,484
$ 59,484
$ 59,484
$ 59,484

$ 694,324
$ 694,324

$ 694,324
$ 694,324
$ 694,324
$ 694,324
$ 694,324
$ 694,324
$ 694,324
$ 694,324

$ —

$ (1,814)

$ —

$ (1,814)

$ —

$ (5,957)

$ —

$ (5,957)

$ —
$ —
$ —
$ —
$ —
—
$ —
$ —
$ —
$ —
$ —

$ (1,814)
$ (1,814)
$ (1,814)
$ (1,814)
$ (1,814)
(6,027)
$ (1,814)
$ (1,814)
$ (1,814)
$ (1,814)
$ (1,814)

$ —
$ —
$ —
$ —
$ —
—
$ —
$ —
$ —
$ —
$ —

$ (1,814)
$ (1,814)
$ (1,814)
$ (1,814)
$ (1,814)
(6,027)
$ (1,814)
$ (1,814)
$ (1,814)
$ (1,814)
$ (1,814)

$  —
$  —
$  —
$  —
$  —
—
$ —
$ —
$ —
$ —
$ —

$  (5,957)
(18,768)
$ (5,957)

$  (5,957)
$  (5,957)
$  (5,957)
$  (5,957)
$ (5,957)
$ (5,957)
$ (5,957)
$ (5,957)

$  —
$  —
$  —
$  —
$  —
—
$ —
$ —
$ —
$ —
$ —

$  (5,957)
(18,768)
$ (5,957)

$  (5,957)
$  (5,957)
$  (5,957)
$  (5,957)
$ (5,957)
$ (5,957)
$ (5,957)
$ (5,957)

—
—
—

—
—
—
—
—
—
—
—

(6,027)
(292,263)
(6,027)

(6,027)
(6,027)
(6,027)
(6,027)
(6,027)
(6,027)
(6,027)
(6,027)

—
—
—

—
—
—
—
—
—
—
—

(6,027)
(292,263)
(6,027)

(6,027)
(6,027)
(6,027)
(6,027)
(6,027)
(6,027)
(6,027)
(6,027)

—
—
—

—
—
—
—
—
—
—
—

(18,768)
(399,262)
(18,768)

(18,768)
(18,768)
(18,768)
(18,768)
(18,768)
(18,768)
(18,768)
(18,768)

—
—
—

—
—
—
—
—
—
—
—

(18,768)
(399,262)
(18,768)

(18,768)
(18,768)
(18,768)
(18,768)
(18,768)
(18,768)
(18,768)
(18,768)

—
—
—

—
—
—
—
—
—
—
—

(292,263)
(292,263)
(292,263)
(292,263)
(292,263)
—
(292,263)
(292,263)
(292,263)
(292,263)
(292,263)

—
(162,160)
—

—
—
—
—
—
—
—
—

(292,263)
(162,160)
(292,263)

(292,263)
(292,263)
(292,263)
(292,263)
(292,263)
(292,263)
(292,263)
(292,263)

—
—
—

—
—
—
—
—
—
—
—

(399,262)
(399,262)
(399,262)
(399,262)
(399,262)
—
(399,262)
(399,262)
(399,262)
(399,262)
(399,262)

—
(48,971)
—

—
—
—
—
—
—
—
—

(399,262)
(399,262)
(399,262)
(399,262)
(399,262)
(48,971)
(399,262)
(399,262)
(399,262)
(399,262)
(399,262)

—
—
$ — $ (300,104)

—
—
—
—
—
—
—
—

—
—

—
—
—
—
—
—
—
—

(162,160)
(162,160)
$ (162,160)

(162,160)
(162,160)
(162,160)
(162,160)
(162,160)
(162,160)
(162,160)
(162,160)

(162,160)
(162,160)
$ (462,264)

(162,160)
(162,160)
(162,160)
(162,160)
(162,160)
(162,160)
(162,160)
(162,160)

—
—
—
—
— $ (423,987)

—
—
—
—
—
—
—
—

—
—
—
—
—
—
—
—

(48,971)
(48,971)
$ (48,971)

(48,971)
(48,971)
(48,971)
(48,971)
(48,971)
(48,971)
(48,971)
(48,971)

(48,971)
(48,971)
$ (472,958)

(48,971)
(48,971)
(48,971)
(48,971)
(48,971)
(48,971)
(48,971)
(48,971)

$ (300,104)
$ —
$ (300,104)
$ (300,104)
$ —
$ —
$ (300,104)
$ —
$ (300,104)
$ —
$ — $ (300,104)
$ — $ (300,104)
$ — $ (300,104)
$ — $ (300,104)
$ — $ (300,104)

Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
$ (472,958)
$ (48,971)
$ (48,971)
$ (48,971)
$ (48,971)
$ (472,958)
$ (48,971)
$ (48,971)
$ (48,971)
$ (48,971)
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
summarizes the activity for the years ended December 31, 2019 and 2018:
Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
summarizes the activity for the years ended December 31, 2019 and 2018:
summarizes the activity for the years ended December 31, 2019 and 2018:
summarizes the activity for the years ended December 31, 2019 and 2018:
summarizes the activity for the years ended December 31, 2019 and 2018:
summarizes the activity for the years ended December 31, 2019 and 2018:
summarizes the activity for the years ended December 31, 2019 and 2018:
summarizes the activity for the years ended December 31, 2019 and 2018:
summarizes the activity for the years ended December 31, 2019 and 2018:
summarizes the activity for the years ended December 31, 2019 and 2018:
summarizes the activity for the years ended December 31, 2019 and 2018:

—
—
$ (423,987)
$ (423,987)
—
$ (423,987)
—
$ (423,987)
—
$ (423,987)
— $ (423,987)
— $ (423,987)
— $ (423,987)
— $ (423,987)
— $ (423,987)

$ (462,264)
$ (462,264)
$ (462,264)
$ (462,264)
$ (462,264)
$ (462,264)
$ (462,264)
$ (462,264)

$ (162,160)
$ (162,160)
$ (162,160)
$ (162,160)
$ (162,160)
$ (162,160)
$ (162,160)
$ (162,160)

$ (472,958)
$ (472,958)
$ (472,958)
$ (472,958)
$ (472,958)
$ (472,958)
$ (472,958)
$ (472,958)

$ (462,264)
$ (462,264)

$ (162,160)
$ (162,160)

$ (48,971)
$ (48,971)

Balance at beginning of year

Balance at beginning of year
Balance at beginning of year
Balance at beginning of year
Balance at beginning of year
Balance at beginning of year
Balance at beginning of year
Balance at beginning of year
Balance at beginning of year

Additions from acquisitions
Balance at beginning of year
Balance at beginning of year
Payments
Additions from acquisitions
Additions from acquisitions
Gain included in earnings

Additions from acquisitions
Additions from acquisitions
Additions from acquisitions
Additions from acquisitions
Additions from acquisitions
Additions from acquisitions
Additions from acquisitions
Additions from acquisitions

$ (48,971)

$ (11,539 )

(132,422)
$ (48,971)
$ (48,971)
$ (48,971)
$ (48,971)
$ (48,971)
$ (48,971)
$ (48,971)
$ (48,971)
$ (48,971)
$ (48,971)
11,800
(132,422)
(132,422)
(132,422)
(132,422)
(132,422)
(132,422)
(132,422)
(132,422)
(132,422)
(132,422)
7,433

11,800

11,800

11,800

11,800

11,800

11,800

11,800

11,800

11,800

11,800

$ (162,160)

7,433

7,433

7,433

7,433

7,433

7,433

7,433

7,433

7,433

7,433

(53,962)
$ (11,539)
$ (11,539)
$ (11,539)
$ (11,539)
$ (11,539)
$ (11,539 )
$ (11,539 )
$ (11,539 )
$ (11,539 )
$ (11,539 )
183
16,530
(53,962)
(53,962)
(53,962)
(53,962)
(53,962)
(53,962)
(53,962)
(53,962)
(53,962)
(53,962)
—

16,530

16,530

16,530

16,530

16,530

16,530

16,530

16,530

16,530

16,530

$ (48,971)

—

—

—

—

—

—

—

—

—

—

Payments

Payments

Payments

Payments

Payments

Payments

Payments

Payments

Payments

Payments

Balance at end of year

Gain included in earnings

Gain included in earnings

Gain included in earnings

Gain included in earnings

Gain included in earnings

Gain included in earnings

Gain included in earnings

Gain included in earnings

Gain included in earnings

Gain included in earnings

As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is

Balance at end of year

Balance at end of year

Balance at end of year

Balance at end of year

Balance at end of year

Balance at end of year

Balance at end of year

Balance at end of year

Balance at end of year

Balance at end of year

$ (162,160)

$ (162,160)

$ (162,160)

$ (162,160)

$ (162,160)

$ (162,160)

$ (162,160)

$ (162,160)

$ (162,160)

$ (162,160)

$ (48,971)

$ (48,971)

$ (48,971)

$ (48,971)

$ (48,971)

$ (48,971)

$ (48,971)

$ (48,971)

$ (48,971)

$ (48,971)

included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the

As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is

As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is

accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the

As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is

As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is

As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is

As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is

As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is

As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is

As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is

As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is

fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,

included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the

included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the

included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the

included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the

included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the

included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the

included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the

included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the

included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the

included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the

accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the

accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the

acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,

accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the

accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the

accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the

accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the

accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the

accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the

accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the

accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the

fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,

fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,

fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,

fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,

fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,

fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,

fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,

fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,

fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,

fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,

the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5

acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,

acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,

acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,

acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,

acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,

acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,

acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,

acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,

acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,

acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,

"Acquisitions and Divestitures".

the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5

the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5

the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5

the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5

the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5

the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5

the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5

the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5

the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5

the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5

"Acquisitions and Divestitures".

"Acquisitions and Divestitures".

"Acquisitions and Divestitures".

"Acquisitions and Divestitures".

"Acquisitions and Divestitures".

"Acquisitions and Divestitures".

"Acquisitions and Divestitures".

"Acquisitions and Divestitures".

"Acquisitions and Divestitures".

"Acquisitions and Divestitures".

(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018 
 
 
 
 
 
 
 
 
 
 
$  —

$ —

$ —

$ —

$ —

$ 129,586

$ 129,586

$ 129,586

$ 129,586

$ 129,586

$ —

$ —

$ —

$ —

$ —

$ 129,586

$ 129,586

$ 129,586

$ 129,586

$ 129,586

$ 350

$ 350

$ 350

$ 350

$ 350

$ 234,256

$ 234,256

$ 234,256

$ 234,256

$ 234,256

$ —

$ —

$ —

$ —

$ —

$ 234,606

$ 234,606

$ 234,606

$ 234,606

$ 234,606

Marketable equity

Marketable equity

Marketable equity

Marketable equity

Marketable equity

870

870

870

870

870

—

—

—

—

—

—

—

—

—

—

870

870

870

870

870

2,117

2,117

2,117

2,117

2,117

—

—

—

—

—

—

—

—

—

—

2,117

2,117

2,117

2,117

2,117

—

—

—

—

—

—

—

—

—

—

70,849

70,849

70,849

70,849

70,849

70,849

70,849

70,849

70,849

70,849

—

—

—

—

—

—

—

—

—

—

59,484

59,484

59,484

59,484

59,484

59,484

59,484

59,484

59,484

59,484

Call option

Call option

Call option

Call option

Call option

—

—

290,971

290,971

290,971

290,971

290,971

—

—

290,971

290,971

290,971

290,971

290,971

—

—

395,095

395,095

395,095

395,095

395,095

—

—

395,095

395,095

395,095

395,095

395,095

Foreign exchange

Foreign exchange

Foreign exchange

Foreign exchange

Foreign exchange

—

—

6,689

6,689

6,689

6,689

6,689

—

—

6,689

6,689

6,689

6,689

6,689

—

—

2,673

2,673

2,673

2,673

2,673

—

—

2,673

2,673

2,673

2,673

2,673

Embedded

Embedded

Embedded

Embedded

Embedded

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

349

349

349

349

349

—

—

—

—

—

349

349

349

349

349

—

—

—

—

—

2,474

2,474

2,474

2,474

2,474

—

—

—

—

—

2,474

2,474

2,474

2,474

2,474

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

—

$ 870

$ 870

$ 870

$ 870

$ 870

$ 429,720

$ 429,720

$ 429,720

$ 429,720

$ 429,720

$ 70,849

$ 70,849

$ 70,849

$ 70,849

$ 70,849

$ 501,439

$ 501,439

$ 501,439

$ 501,439

$ 501,439

$ 2,467

$ 2,467

$ 2,467

$ 2,467

$ 2,467

$ 632,373

$ 632,373

$ 632,373

$ 632,373

$ 632,373

$ 59,484

$ 59,484

$ 59,484

$ 59,484

$ 59,484

$ 694,324

$ 694,324

$ 694,324

$ 694,324

$ 694,324

Short-term

Short-term

Short-term

Short-term

Short-term

investments

investments

investments

investments

investments

securities

securities

securities

securities

securities

Non-marketable

Non-marketable

Non-marketable

Non-marketable

Non-marketable

equity securities

equity securities

equity securities

equity securities

equity securities

contracts

contracts

contracts

contracts

contracts

conversion option

conversion option

conversion option

conversion option

conversion option

Interest rate

Interest rate

Interest rate

Interest rate

Interest rate

contracts

contracts

contracts

contracts

contracts

—

—

—

—

—

—

Foreign exchange
Foreign exchange
Foreign exchange
Foreign exchange
contracts
contracts
contracts
contracts

Foreign exchange
contracts

$ —
$ —
$ —

—

—

—

—

—

—

$ —
$ —
$ —

$ —

$ —

$ (1,814)
$ (1,814)
$ (1,814)

$ (1,814)

$ (1,814)

$ —

$ —

$  (5,957)
$ (5,957)
$ (5,957)

$ (5,957)

$ (5,957)

$ —

$ —

$  (5,957)
$ (5,957)
$ (5,957)

$ (5,957)

$ (5,957)

$ (1,814)

$ (1,814)

$ (1,814)
$ (1,814)
$ (1,814)

$ —

$ —

Interest rate
Interest rate
Interest rate
contracts
contracts
contracts

Interest rate
Interest rate
contracts
contracts

—
—
—

—

—

(6,027)
(6,027)
(6,027)

(6,027)

(6,027)

—
—
—

—

—

(6,027)
(6,027)
(6,027)

(6,027)

(6,027)

Cash conversion
Cash conversion
Cash conversion
Cash conversion
option
option
option
option

Cash conversion
option

—
—
—

—

(292,263)
—
(292,263)
(292,263)

(292,263)

(292,263)

—
—
—

—

(292,263)
—
(292,263)
(292,263)

(292,263)

(292,263)

—

—

(18,768)
(18,768)
(18,768)

(18,768)

(18,768)

—

(399,262)
—
(399,262)
(399,262)

(399,262)

(399,262)

—

—

(18,768)
(18,768)
(18,768)

(18,768)

(18,768)

—

(399,262)
—
(399,262)
(399,262)

(399,262)

(399,262)

—

—

—

—

—

—

$  —
$ —
$ —

—
—
—

—
—
—

—

—

—

—

—

—

$  —
$ —
$ —

—
—
—

—
—
—

Contingent
Contingent
Contingent
consideration
consideration
consideration

Contingent
Contingent
consideration
consideration

—
—
—

—

—

—
—
—

—

(162,160)
—
(162,160)
(162,160)

(162,160)

(162,160)

(162,160)
(162,160)
(162,160)

(162,160)

(162,160)

—
—
—

—

—

—
—
—

—

—

(48,971)
(48,971)
(48,971)

(48,971)

(48,971)

(48,971)
(48,971)
(48,971)

(48,971)

(48,971)

$ (300,104)
$ —
$ — $ (300,104)
$ — $ (300,104)
$ — $ (300,104)

$ — $ (300,104)

$ (162,160)
$ (162,160)
$ (162,160)

$ (162,160)

$ (162,160)

$ (462,264)
$ (462,264)
$ (462,264)

$ (462,264)

$ (462,264)

$ (423,987)
—
— $ (423,987)
— $ (423,987)
— $ (423,987)

— $ (423,987)

$ (48,971)
$ (48,971)
$ (48,971)

$ (48,971)

$ (48,971)

$ (472,958)
$ (472,958)
$ (472,958)

$ (472,958)

$ (472,958)

Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
Refer to Note 10 "Investments" for the change in non-marketable equity securities with Level 3 inputs during the year
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
ended December 31, 2019. For contingent consideration liabilities with Level 3 inputs, the following table
summarizes the activity for the years ended December 31, 2019 and 2018:
summarizes the activity for the years ended December 31, 2019 and 2018:
summarizes the activity for the years ended December 31, 2019 and 2018:
summarizes the activity for the years ended December 31, 2019 and 2018:
summarizes the activity for the years ended December 31, 2019 and 2018:

Balance at beginning of year
Balance at beginning of year
Balance at beginning of year

Balance at beginning of year

Balance at beginning of year

Additions from acquisitions
Additions from acquisitions
Additions from acquisitions

Additions from acquisitions

Additions from acquisitions

Payments
Payments
Payments

Payments

Payments

$ (48,971)
$ (48,971)
$ (48,971)

$ (48,971)

$ (48,971)

$ (11,539)
$ (11,539 )
$ (11,539 )

$ (11,539 )

$ (11,539 )

(132,422)
(132,422)
(132,422)

(132,422)

(132,422)

(53,962)
(53,962)
(53,962)

(53,962)

(53,962)

11,800
11,800
11,800

11,800

11,800

16,530
16,530
16,530

16,530

16,530

Gain included in earnings
Gain included in earnings
Gain included in earnings

Gain included in earnings

Gain included in earnings

7,433
7,433
7,433

7,433

7,433

—
—
—

—

—

Balance at end of year
Balance at end of year
Balance at end of year

Balance at end of year

Balance at end of year

$ (162,160)
$ (162,160)
$ (162,160)

$ (162,160)

$ (162,160)

$ (48,971)
$ (48,971)
$ (48,971)

$ (48,971)

$ (48,971)

As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is
As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is
As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is
As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is
As of December 31, 2019, of the total $162.2 million accrued for contingent consideration, $142.6 million is
included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the
included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the
included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the
included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the
included in accrued and other current liabilities and $19.6 million is included in other long-term liabilities in the
accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the
accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the
accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the
accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the
accompanying consolidated balance sheet. For the year ended December 31, 2019 the gain for the reduction in the
fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,
fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,
fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,
fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,
fair value of contingent consideration related to unmet milestones of $7.4 million was recognized in restructuring,
acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,
acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,
acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,
acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,
acquisition, integration and other, net in the accompanying consolidated statements of income. December 31, 2019,
the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5
the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5
the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5
the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5
the $132.4 million of additions is primarily related to the asset acquisition of Formulatrix discussed in Note 5
"Acquisitions and Divestitures".
"Acquisitions and Divestitures".
"Acquisitions and Divestitures".
"Acquisitions and Divestitures".
"Acquisitions and Divestitures".

The carrying values of financial instruments, including cash and cash equivalents, accounts receivable, accounts
The carrying values of financial instruments, including cash and cash equivalents, accounts receivable, accounts
The carrying values of financial instruments, including cash and cash equivalents, accounts receivable, accounts
The carrying values of financial instruments, including cash and cash equivalents, accounts receivable, accounts
The carrying values of financial instruments, including cash and cash equivalents, accounts receivable, accounts
The carrying values of financial instruments, including cash and cash equivalents, accounts receivable, accounts
The carrying values of financial instruments, including cash and cash equivalents, accounts receivable, accounts
payable and other accrued liabilities, approximate their fair values due to their short-term maturities. The estimated
payable and other accrued liabilities, approximate their fair values due to their short-term maturities. The estimated
payable and other accrued liabilities, approximate their fair values due to their short-term maturities. The estimated
payable and other accrued liabilities, approximate their fair values due to their short-term maturities. The estimated
payable and other accrued liabilities, approximate their fair values due to their short-term maturities. The estimated
payable and other accrued liabilities, approximate their fair values due to their short-term maturities. The estimated
payable and other accrued liabilities, approximate their fair values due to their short-term maturities. The estimated
fair value of long-term debt as disclosed in Note 16 "Lines of Credit and Debt" was based on current interest rates
fair value of long-term debt as disclosed in Note 16 "Lines of Credit and Debt" was based on current interest rates
fair value of long-term debt as disclosed in Note 16 "Lines of Credit and Debt" was based on current interest rates
fair value of long-term debt as disclosed in Note 16 "Lines of Credit and Debt" was based on current interest rates
fair value of long-term debt as disclosed in Note 16 "Lines of Credit and Debt" was based on current interest rates
fair value of long-term debt as disclosed in Note 16 "Lines of Credit and Debt" was based on current interest rates
fair value of long-term debt as disclosed in Note 16 "Lines of Credit and Debt" was based on current interest rates
for similar types of borrowings. The estimated fair values may not represent actual values of the financial instruments
for similar types of borrowings. The estimated fair values may not represent actual values of the financial instruments
for similar types of borrowings. The estimated fair values may not represent actual values of the financial instruments
for similar types of borrowings. The estimated fair values may not represent actual values of the financial instruments
for similar types of borrowings. The estimated fair values may not represent actual values of the financial instruments
for similar types of borrowings. The estimated fair values may not represent actual values of the financial instruments
for similar types of borrowings. The estimated fair values may not represent actual values of the financial instruments
that could be realized as of the balance sheet date or that will be realized in the future. There were no fair value
that could be realized as of the balance sheet date or that will be realized in the future. There were no fair value
that could be realized as of the balance sheet date or that will be realized in the future. There were no fair value
that could be realized as of the balance sheet date or that will be realized in the future. There were no fair value
that could be realized as of the balance sheet date or that will be realized in the future. There were no fair value
that could be realized as of the balance sheet date or that will be realized in the future. There were no fair value
that could be realized as of the balance sheet date or that will be realized in the future. There were no fair value
differences in the years ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be
differences in the years ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be
differences in the years ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be
differences in the years ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be
differences in the years ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be
differences in the years ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be
differences in the years ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be
measured at fair value on a nonrecurring basis other than the impairment of non-marketable investments not
measured at fair value on a nonrecurring basis other than the impairment of non-marketable investments not
measured at fair value on a nonrecurring basis other than the impairment of non-marketable investments not
measured at fair value on a nonrecurring basis other than the impairment of non-marketable investments not
measured at fair value on a nonrecurring basis other than the impairment of non-marketable investments not
measured at fair value on a nonrecurring basis other than the impairment of non-marketable investments not
measured at fair value on a nonrecurring basis other than the impairment of non-marketable investments not
accounted for under the equity method as discussed in Note 10.
accounted for under the equity method as discussed in Note 10.
accounted for under the equity method as discussed in Note 10.
accounted for under the equity method as discussed in Note 10.
accounted for under the equity method as discussed in Note 10.
accounted for under the equity method as discussed in Note 10.
accounted for under the equity method as discussed in Note 10.

The table below presents the carrying values and the estimated fair values of financial instruments not presented in
The table below presents the carrying values and the estimated fair values of financial instruments not presented in
the tables above.
the tables above.

The table below presents the carrying values and the estimated fair values of financial instruments not presented in
The table below presents the carrying values and the estimated fair values of financial instruments not presented in
The table below presents the carrying values and the estimated fair values of financial instruments not presented in
The table below presents the carrying values and the estimated fair values of financial instruments not presented in
The table below presents the carrying values and the estimated fair values of financial instruments not presented in
the tables above.
the tables above.
the tables above.
the tables above.
the tables above.

U.S. Private placement
U.S. Private placement
U.S. Private placement
U.S. Private placement
U.S. Private placement

Cash convertible notes
Cash convertible notes
Cash convertible notes
Cash convertible notes
Cash convertible notes

Cash convertible notes
Cash convertible notes
U.S. Private placement
U.S. Private placement
German private placement
German private placement

German private placement
German private placement
German private placement
German private placement
German private placement

328,984
328,984
328,984
328,984
328,984

$ 1,046,511
$ 1,046,511
$ 1,046,511
$ 1,046,511
$ 1,046,511

$ 1,046,511
$ 1,046,511
328,984
328,984
330,857
330,857
$ 1,706,352
$ 1,706,352
$ 1,706,352
$ 1,706,352
$ 1,706,352
$ 1,706,352
$ 1,706,352

330,857
330,857
330,857
330,857
330,857

—
—
—
—
—

$ 1,296,334
$ 1,296,334
$ 1,296,334
$ 1,296,334
$ 1,296,334

$ 1,296,334
$ 1,296,334
—
—
—
—
$ 1,296,334
$ 1,296,334
$ 1,296,334
$ 1,296,334
$ 1,296,334
$ 1,296,334
$ 1,296,334

—
—
—
—
—

$ —
$ —
$ —
$ —
$ —

$ —
$ —
329,157
329,157
329,157
329,157
329,157
329,157
329,157
334,371
334,371
$ 663,528
$ 663,528
$ 663,528
$ 663,528
$ 663,528
$ 663,528
$ 663,528

334,371
334,371
334,371
334,371
334,371

398,107
398,107
398,107
398,107
398,107

$ 1,439,931
$ 1,439,931
$ 1,439,931
$ 1,439,931
$ 1,439,931

$ 1,439,931
$ 1,439,931
398,107
398,107
336,168
336,168
$ 2,174,206
$ 2,174,206
$ 2,174,206
$ 2,174,206
$ 2,174,206
$ 2,174,206
$ 2,174,206

336,168
336,168
336,168
336,168
336,168

—
—
—
—
—

$ 1,794,000
$ 1,794,000
$ 1,794,000
$ 1,794,000
$ 1,794,000

$ 1,794,000
$ 1,794,000
—
—
—
—
$ 1,794,000
$ 1,794,000
$ 1,794,000
$ 1,794,000
$ 1,794,000
$ 1,794,000
$ 1,794,000

—
—
—
—
—

$ —
$ —
$ —
$ —
$ —

$ —
$  —
391,700
391,700
391,700
391,700
391,700
391,700
391,700
337,768
337,768
$ 729,468
$ 729,468
$ 729,468
$ 729,468
$ 729,468
$ 729,468
$ 729,468

337,768
337,768
337,768
337,768
337,768

The fair values of the financial instruments presented in the tables above were determined as follows:
The fair values of the financial instruments presented in the tables above were determined as follows:
The fair values of the financial instruments presented in the tables above were determined as follows:
The fair values of the financial instruments presented in the tables above were determined as follows:
The fair values of the financial instruments presented in the tables above were determined as follows:

The fair values of the financial instruments presented in the tables above were determined as follows:
The fair values of the financial instruments presented in the tables above were determined as follows:

Cash Convertible Notes: Fair value is based on an estimation using available over-the-counter market information on
Cash Convertible Notes: Fair value is based on an estimation using available over-the-counter market information on
Cash Convertible Notes: Fair value is based on an estimation using available over-the-counter market information on
Cash Convertible Notes: Fair value is based on an estimation using available over-the-counter market information on
Cash Convertible Notes: Fair value is based on an estimation using available over-the-counter market information on
the Cash Convertible Notes due in 2021, 2023 and 2024.
the Cash Convertible Notes due in 2021, 2023 and 2024.
the Cash Convertible Notes due in 2021, 2023 and 2024.
the Cash Convertible Notes due in 2021, 2023 and 2024.
the Cash Convertible Notes due in 2021, 2023 and 2024.

Cash Convertible Notes: Fair value is based on an estimation using available over-the-counter market information on
Cash Convertible Notes: Fair value is based on an estimation using available over-the-counter market information on
the Cash Convertible Notes due in 2021, 2023 and 2024.
the Cash Convertible Notes due in 2021, 2023 and 2024.

U.S. Private Placement: Fair value of the outstanding bonds is based on an estimation using the changes in the U.S.
U.S. Private Placement: Fair value of the outstanding bonds is based on an estimation using the changes in the U.S.
U.S. Private Placement: Fair value of the outstanding bonds is based on an estimation using the changes in the U.S.
U.S. Private Placement: Fair value of the outstanding bonds is based on an estimation using the changes in the U.S.
U.S. Private Placement: Fair value of the outstanding bonds is based on an estimation using the changes in the U.S.
Treasury rates.
Treasury rates.
Treasury rates.
Treasury rates.
Treasury rates.

U.S. Private Placement: Fair value of the outstanding bonds is based on an estimation using the changes in the U.S.
U.S. Private Placement: Fair value of the outstanding bonds is based on an estimation using the changes in the U.S.
Treasury rates.
184
Treasury rates.

German Private Placement: Fair value is based on an estimation using changes in the euro swap rates.

German Private Placement: Fair value is based on an estimation using changes in the euro swap rates.

German Private Placement: Fair value is based on an estimation using changes in the euro swap rates.

German Private Placement: Fair value is based on an estimation using changes in the euro swap rates.

German Private Placement: Fair value is based on an estimation using changes in the euro swap rates.

German Private Placement: Fair value is based on an estimation using changes in the euro swap rates.

German Private Placement: Fair value is based on an estimation using changes in the euro swap rates.

The estimated fair values may not represent actual values of the financial instruments that could be realized as of the

The estimated fair values may not represent actual values of the financial instruments that could be realized as of the

The estimated fair values may not represent actual values of the financial instruments that could be realized as of the

The estimated fair values may not represent actual values of the financial instruments that could be realized as of the

The estimated fair values may not represent actual values of the financial instruments that could be realized as of the

The estimated fair values may not represent actual values of the financial instruments that could be realized as of the

The estimated fair values may not represent actual values of the financial instruments that could be realized as of the

balance sheet date or that will be realized in the future. There were no adjustments in the twelve-month periods

balance sheet date or that will be realized in the future. There were no adjustments in the twelve-month periods

balance sheet date or that will be realized in the future. There were no adjustments in the twelve-month periods

balance sheet date or that will be realized in the future. There were no adjustments in the twelve-month periods

balance sheet date or that will be realized in the future. There were no adjustments in the twelve-month periods

balance sheet date or that will be realized in the future. There were no adjustments in the twelve-month periods

balance sheet date or that will be realized in the future. There were no adjustments in the twelve-month periods

ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be measured at fair value on a

ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be measured at fair value on a

ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be measured at fair value on a

ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be measured at fair value on a

ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be measured at fair value on a

ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be measured at fair value on a

ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be measured at fair value on a

nonrecurring basis.

nonrecurring basis.

nonrecurring basis.

nonrecurring basis.

nonrecurring basis.

nonrecurring basis.

nonrecurring basis.

16. Lines of Credit and Debt

16. Lines of Credit and Debt

16. Lines of Credit and Debt

16. Lines of Credit and Debt

16. Lines of Credit and Debt

16. Lines of Credit and Debt

16. Lines of Credit and Debt

Our credit facilities available and undrawn at December 31, 2019 total €426.6 million (approximately $479.2

Our credit facilities available and undrawn at December 31, 2019 total €426.6 million (approximately $479.2

Our credit facilities available and undrawn at December 31, 2019 total €426.6 million (approximately $479.2

Our credit facilities available and undrawn at December 31, 2019 total €426.6 million (approximately $479.2

Our credit facilities available and undrawn at December 31, 2019 total €426.6 million (approximately $479.2

Our credit facilities available and undrawn at December 31, 2019 total €426.6 million (approximately $479.2

Our credit facilities available and undrawn at December 31, 2019 total €426.6 million (approximately $479.2

million). This includes a €400.0 million syndicated multi-currency revolving credit facility expiring December 2021 of

million). This includes a €400.0 million syndicated multi-currency revolving credit facility expiring December 2021 of

million). This includes a €400.0 million syndicated multi-currency revolving credit facility expiring December 2021 of

million). This includes a €400.0 million syndicated multi-currency revolving credit facility expiring December 2021 of

million). This includes a €400.0 million syndicated multi-currency revolving credit facility expiring December 2021 of

million). This includes a €400.0 million syndicated multi-currency revolving credit facility expiring December 2021 of

million). This includes a €400.0 million syndicated multi-currency revolving credit facility expiring December 2021 of

which no amounts were utilized at December 31, 2019 or at December 31, 2018, and three other lines of credit

which no amounts were utilized at December 31, 2019 or at December 31, 2018, and three other lines of credit

which no amounts were utilized at December 31, 2019 or at December 31, 2018, and three other lines of credit

which no amounts were utilized at December 31, 2019 or at December 31, 2018, and three other lines of credit

which no amounts were utilized at December 31, 2019 or at December 31, 2018, and three other lines of credit

which no amounts were utilized at December 31, 2019 or at December 31, 2018, and three other lines of credit

which no amounts were utilized at December 31, 2019 or at December 31, 2018, and three other lines of credit

amounting to €26.6 million with no expiration date, none of which were utilized as of December 31, 2019 or as of

amounting to €26.6 million with no expiration date, none of which were utilized as of December 31, 2019 or as of

amounting to €26.6 million with no expiration date, none of which were utilized as of December 31, 2019 or as of

amounting to €26.6 million with no expiration date, none of which were utilized as of December 31, 2019 or as of

amounting to €26.6 million with no expiration date, none of which were utilized as of December 31, 2019 or as of

amounting to €26.6 million with no expiration date, none of which were utilized as of December 31, 2019 or as of

amounting to €26.6 million with no expiration date, none of which were utilized as of December 31, 2019 or as of

December 31, 2018. The €400.0 million facility can be utilized in Euro, British pounds sterling, Swiss franc or U.S.

December 31, 2018. The €400.0 million facility can be utilized in Euro, British pounds sterling, Swiss franc or U.S.

December 31, 2018. The €400.0 million facility can be utilized in Euro, British pounds sterling, Swiss franc or U.S.

December 31, 2018. The €400.0 million facility can be utilized in Euro, British pounds sterling, Swiss franc or U.S.

December 31, 2018. The €400.0 million facility can be utilized in Euro, British pounds sterling, Swiss franc or U.S.

December 31, 2018. The €400.0 million facility can be utilized in Euro, British pounds sterling, Swiss franc or U.S.

December 31, 2018. The €400.0 million facility can be utilized in Euro, British pounds sterling, Swiss franc or U.S.

dollar and bears interest of 0.4% to 1.2% above three months EURIBOR, or LIBOR in relation to any loan not in euro,

dollar and bears interest of 0.4% to 1.2% above three months EURIBOR, or LIBOR in relation to any loan not in euro,

dollar and bears interest of 0.4% to 1.2% above three months EURIBOR, or LIBOR in relation to any loan not in euro,

dollar and bears interest of 0.4% to 1.2% above three months EURIBOR, or LIBOR in relation to any loan not in euro,

dollar and bears interest of 0.4% to 1.2% above three months EURIBOR, or LIBOR in relation to any loan not in euro,

dollar and bears interest of 0.4% to 1.2% above three months EURIBOR, or LIBOR in relation to any loan not in euro,

dollar and bears interest of 0.4% to 1.2% above three months EURIBOR, or LIBOR in relation to any loan not in euro,

and is offered with interest periods of one, two, three or six months. The commitment fee is calculated based on 35%

and is offered with interest periods of one, two, three or six months. The commitment fee is calculated based on 35%

and is offered with interest periods of one, two, three or six months. The commitment fee is calculated based on 35%

and is offered with interest periods of one, two, three or six months. The commitment fee is calculated based on 35%

and is offered with interest periods of one, two, three or six months. The commitment fee is calculated based on 35%

and is offered with interest periods of one, two, three or six months. The commitment fee is calculated based on 35%

and is offered with interest periods of one, two, three or six months. The commitment fee is calculated based on 35%

of the applicable margin. In 2019 and 2018, $1.0 million of commitment fees were paid, respectively. The

of the applicable margin. In 2019 and 2018, $1.0 million of commitment fees were paid, respectively. The

of the applicable margin. In 2019 and 2018, $1.0 million of commitment fees were paid, respectively. The

of the applicable margin. In 2019 and 2018, $1.0 million of commitment fees were paid, respectively. The

of the applicable margin. In 2019 and 2018, $1.0 million of commitment fees were paid, respectively. The

of the applicable margin. In 2019 and 2018, $1.0 million of commitment fees were paid, respectively. The

of the applicable margin. In 2019 and 2018, $1.0 million of commitment fees were paid, respectively. The

revolving facility agreement contains certain financial and non-financial covenants, including but not limited to,

revolving facility agreement contains certain financial and non-financial covenants, including but not limited to,

revolving facility agreement contains certain financial and non-financial covenants, including but not limited to,

revolving facility agreement contains certain financial and non-financial covenants, including but not limited to,

revolving facility agreement contains certain financial and non-financial covenants, including but not limited to,

revolving facility agreement contains certain financial and non-financial covenants, including but not limited to,

revolving facility agreement contains certain financial and non-financial covenants, including but not limited to,

restrictions on the encumbrance of assets and the maintenance of certain financial ratios. We were in compliance

restrictions on the encumbrance of assets and the maintenance of certain financial ratios. We were in compliance

restrictions on the encumbrance of assets and the maintenance of certain financial ratios. We were in compliance

restrictions on the encumbrance of assets and the maintenance of certain financial ratios. We were in compliance

restrictions on the encumbrance of assets and the maintenance of certain financial ratios. We were in compliance

restrictions on the encumbrance of assets and the maintenance of certain financial ratios. We were in compliance

restrictions on the encumbrance of assets and the maintenance of certain financial ratios. We were in compliance

with these covenants at December 31, 2019. The credit facilities are for general corporate purposes.

with these covenants at December 31, 2019. The credit facilities are for general corporate purposes.

with these covenants at December 31, 2019. The credit facilities are for general corporate purposes.

with these covenants at December 31, 2019. The credit facilities are for general corporate purposes.

with these covenants at December 31, 2019. The credit facilities are for general corporate purposes.

with these covenants at December 31, 2019. The credit facilities are for general corporate purposes.

with these covenants at December 31, 2019. The credit facilities are for general corporate purposes.

During 2019, we repaid $506.4 million of long-term debt including $430.0 million for the amount due for the 2019

During 2019, we repaid $506.4 million of long-term debt including $430.0 million for the amount due for the 2019

During 2019, we repaid $506.4 million of long-term debt including $430.0 million for the amount due for the 2019

During 2019, we repaid $506.4 million of long-term debt including $430.0 million for the amount due for the 2019

During 2019, we repaid $506.4 million of long-term debt including $430.0 million for the amount due for the 2019

During 2019, we repaid $506.4 million of long-term debt including $430.0 million for the amount due for the 2019

Cash Convertible Notes, $73.0 million for amounts due for the U.S. Private Placement and $3.4 million for a portion

Cash Convertible Notes, $73.0 million for amounts due for the U.S. Private Placement and $3.4 million for a portion

Cash Convertible Notes, $73.0 million for amounts due for the U.S. Private Placement and $3.4 million for a portion

Cash Convertible Notes, $73.0 million for amounts due for the U.S. Private Placement and $3.4 million for a portion

Cash Convertible Notes, $73.0 million for amounts due for the U.S. Private Placement and $3.4 million for a portion

Cash Convertible Notes, $73.0 million for amounts due for the U.S. Private Placement and $3.4 million for a portion

(in thousands)As of December 31, 2019As of December 31, 2018Carrying AmountLevel 1Level 2Carrying AmountLevel 1Level 2Long-term debt including currentportion:(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018(in thousands)As of December 31, 2019As of December 31, 2018Level 1Level 2Level 3TotalLevel 1Level 2Level 3TotalAssets:Liabilities:(in thousands)20192018(in thousands)As of December 31, 2019As of December 31, 2018CarryingAmountLevel 1Level 2CarryingAmountLevel 1Level 2Long-term debt including current portion:(in thousands)As of December 31, 2019As of December 31, 2018CarryingAmountLevel 1Level 2CarryingAmountLevel 1Level 2Long-term debt including current portion:(in thousands)As of December 31, 2019As of December 31, 2018CarryingAmountLevel 1Level 2CarryingAmountLevel 1Level 2Long-term debt including current portion:(in thousands)As of December 31, 2019As of December 31, 2018CarryingAmountLevel 1Level 2CarryingAmountLevel 1Level 2Long-term debt including current portion:(in thousands)As of December 31, 2019As of December 31, 2018CarryingAmountLevel 1Level 2CarryingAmountLevel 1Level 2Long-term debt including current portion:(in thousands)As of December 31, 2019As of December 31, 2018CarryingAmountLevel 1Level 2CarryingAmountLevel 1Level 2Long-term debt including current portion: 
 
 
 
 
The carrying values of financial instruments, including cash and cash equivalents, accounts receivable, accounts

payable and other accrued liabilities, approximate their fair values due to their short-term maturities. The estimated

fair value of long-term debt as disclosed in Note 16 "Lines of Credit and Debt" was based on current interest rates

for similar types of borrowings. The estimated fair values may not represent actual values of the financial instruments

that could be realized as of the balance sheet date or that will be realized in the future. There were no fair value

differences in the years ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be

measured at fair value on a nonrecurring basis other than the impairment of non-marketable investments not

accounted for under the equity method as discussed in Note 10.

The table below presents the carrying values and the estimated fair values of financial instruments not presented in

the tables above.

F I N A N C I A L   R E S U LT S Notes to consolidated financial statements

Cash convertible notes

$ 1,046,511

$ 1,296,334

$ —

$ 1,439,931

$ 1,794,000

$  —

U.S. Private placement

German private placement

328,984

330,857

—

—

329,157

398,107

334,371

336,168

—

—

391,700

337,768

$ 1,706,352

$ 1,296,334

$ 663,528

$ 2,174,206

$ 1,794,000

$ 729,468

The fair values of the financial instruments presented in the tables above were determined as follows:

Cash Convertible Notes: Fair value is based on an estimation using available over-the-counter market information on
the Cash Convertible Notes due in 2021, 2023 and 2024.

U.S. Private Placement: Fair value of the outstanding bonds is based on an estimation using the changes in the U.S.
Treasury rates.

German Private Placement: Fair value is based on an estimation using changes in the euro swap rates.

The estimated fair values may not represent actual values of the financial instruments that could be realized as of the
balance sheet date or that will be realized in the future. There were no adjustments in the twelve-month periods
ended December 31, 2019 and 2018 for nonfinancial assets or liabilities required to be measured at fair value on a
nonrecurring basis.

16. Lines of Credit and Debt

Our credit facilities available and undrawn at December 31, 2019 total €426.6 million (approximately $479.2
million). This includes a €400.0 million syndicated multi-currency revolving credit facility expiring December 2021 of
which no amounts were utilized at December 31, 2019 or at December 31, 2018, and three other lines of credit
amounting to €26.6 million with no expiration date, none of which were utilized as of December 31, 2019 or as of
December 31, 2018. The €400.0 million facility can be utilized in Euro, British pounds sterling, Swiss franc or U.S.
dollar and bears interest of 0.4% to 1.2% above three months EURIBOR, or LIBOR in relation to any loan not in euro,
and is offered with interest periods of one, two, three or six months. The commitment fee is calculated based on 35%
of the applicable margin. In 2019 and 2018, $1.0 million of commitment fees were paid, respectively. The
revolving facility agreement contains certain financial and non-financial covenants, including but not limited to,
restrictions on the encumbrance of assets and the maintenance of certain financial ratios. We were in compliance
with these covenants at December 31, 2019. The credit facilities are for general corporate purposes.

During 2019, we repaid $506.4 million of long-term debt including $430.0 million for the amount due for the 2019
Cash Convertible Notes, $73.0 million for amounts due for the U.S. Private Placement and $3.4 million for a portion
of the 2021 Cash Convertible Notes which was converted during the contingent conversion period as discussed
further below.

At December 31, 2019 and 2018, total current long-term debt, net of debt issuance costs of $10.8 million and
$14.2 million, respectively, consists of the following:

0.375% Senior Unsecured Cash Convertible Notes due 2019

$ —

$ 427,445

0.875% Senior Unsecured Cash Convertible Notes due 2021

0.500% Senior Unsecured Cash Convertible Notes due 2023

1.000% Senior Unsecured Cash Convertible Notes due 2024

3.19% Series A Senior Notes due October 16, 2019

3.75% Series B Senior Notes due October 16, 2022

3.90% Series C Senior Notes due October 16, 2024

German Private Placement (Schuldschein)

Total long-term debt

Less current portion

Long-term portion

2020

2021

2022

2023

2024

thereafter

285,244

347,995

413,272

—

302,040

26,944

330,857

279,492

335,201

397,793

72,483

298,691

26,933

336,168

$ 1,706,352

$ 2,174,206

285,244

503,116

185

$ 1,421,108

$  1,671,090

$ 285,244

38,716

471,432

347,995

546,716

16,249

$ 1,706,352

Beginning on January 1, 2020 and ending at the close of business on March 31, 2020, the 2021 Notes became

convertible pursuant to the indenture as discussed below. The notes are all unsecured obligations that rank pari

passu. Interest expense on long-term debt was $68.0 million, $61.2 million and $43.6 million for the years ended

December 31, 2019, 2018 and 2017, respectively.

Future maturities (stated at the carrying values) of long-term debt as of December 31, 2019, are as follows:

On March 19, 2014, we issued $730.0 million aggregate principal amount of Cash Convertible Senior Notes in

two tranches consisting of $430.0 million due in 2019 (2019 Notes) and $300.0 million due in 2021 (2021

Notes). The aggregate net proceeds of the 2019 and 2021 Convertible Notes were $680.7 million, after payment

of the net cost of the Call Spread Overlay described below and transaction costs. Additionally, we used $372.5

million of the net proceeds to repay other debt. During the first quarter of 2019, $430.0 million was paid at maturity

(2019 Notes) and $3.4 million of the 2021 Notes was redeemed.

On September 13, 2017, we issued $400.0 million aggregate principal amount of Cash Convertible Senior Notes

which is due in 2023 (2023 Notes). The net proceeds of the 2023 Notes were $365.6 million, after payment of the

(in thousands)As of December 31, 2019As of December 31, 2018Carrying AmountLevel 1Level 2Carrying AmountLevel 1Level 2Long-term debt including currentportion:Cash Convertible Notes due 2019, 2021, 2023 and 2024(in thousands)20192018Year ending December 31,(in thousands)During 2019, we repaid $506.4 million of long-term debt including $430.0 million for the amount due for the 2019
Cash Convertible Notes, $73.0 million for amounts due for the U.S. Private Placement and $3.4 million for a portion
During 2019, we repaid $506.4 million of long-term debt including $430.0 million for the amount due for the 2019
of the 2021 Cash Convertible Notes which was converted during the contingent conversion period as discussed
of the 2021 Cash Convertible Notes which was converted during the contingent conversion period as discussed
of the 2021 Cash Convertible Notes which was converted during the contingent conversion period as discussed
of the 2021 Cash Convertible Notes which was converted during the contingent conversion period as discussed
of the 2021 Cash Convertible Notes which was converted during the contingent conversion period as discussed
of the 2021 Cash Convertible Notes which was converted during the contingent conversion period as discussed
Cash Convertible Notes, $73.0 million for amounts due for the U.S. Private Placement and $3.4 million for a portion
further below.
further below.
further below.
further below.
further below.
further below.
of the 2021 Cash Convertible Notes which was converted during the contingent conversion period as discussed
further below.

At December 31, 2019 and 2018, total current long-term debt, net of debt issuance costs of $10.8 million and
$14.2 million, respectively, consists of the following:

At December 31, 2019 and 2018, total current long-term debt, net of debt issuance costs of $10.8 million and
At December 31, 2019 and 2018, total current long-term debt, net of debt issuance costs of $10.8 million and
$14.2 million, respectively, consists of the following:
$14.2 million, respectively, consists of the following:

At December 31, 2019 and 2018, total current long-term debt, net of debt issuance costs of $10.8 million and
At December 31, 2019 and 2018, total current long-term debt, net of debt issuance costs of $10.8 million and
At December 31, 2019 and 2018, total current long-term debt, net of debt issuance costs of $10.8 million and
$14.2 million, respectively, consists of the following:
$14.2 million, respectively, consists of the following:
$14.2 million, respectively, consists of the following:
At December 31, 2019 and 2018, total current long-term debt, net of debt issuance costs of $10.8 million and
$14.2 million, respectively, consists of the following:

0.375% Senior Unsecured Cash Convertible Notes due 2019
0.375% Senior Unsecured Cash Convertible Notes due 2019
0.375% Senior Unsecured Cash Convertible Notes due 2019

0.375% Senior Unsecured Cash Convertible Notes due 2019

0.375% Senior Unsecured Cash Convertible Notes due 2019
0.375% Senior Unsecured Cash Convertible Notes due 2019

0.375% Senior Unsecured Cash Convertible Notes due 2019
0.875% Senior Unsecured Cash Convertible Notes due 2021
0.875% Senior Unsecured Cash Convertible Notes due 2021
0.875% Senior Unsecured Cash Convertible Notes due 2021

0.875% Senior Unsecured Cash Convertible Notes due 2021

0.875% Senior Unsecured Cash Convertible Notes due 2021
0.875% Senior Unsecured Cash Convertible Notes due 2021

0.875% Senior Unsecured Cash Convertible Notes due 2021
0.500% Senior Unsecured Cash Convertible Notes due 2023
0.500% Senior Unsecured Cash Convertible Notes due 2023
0.500% Senior Unsecured Cash Convertible Notes due 2023

0.500% Senior Unsecured Cash Convertible Notes due 2023

0.500% Senior Unsecured Cash Convertible Notes due 2023
0.500% Senior Unsecured Cash Convertible Notes due 2023

0.500% Senior Unsecured Cash Convertible Notes due 2023
1.000% Senior Unsecured Cash Convertible Notes due 2024
1.000% Senior Unsecured Cash Convertible Notes due 2024
1.000% Senior Unsecured Cash Convertible Notes due 2024

1.000% Senior Unsecured Cash Convertible Notes due 2024

1.000% Senior Unsecured Cash Convertible Notes due 2024
1.000% Senior Unsecured Cash Convertible Notes due 2024

1.000% Senior Unsecured Cash Convertible Notes due 2024
3.19% Series A Senior Notes due October 16, 2019
3.19% Series A Senior Notes due October 16, 2019
3.19% Series A Senior Notes due October 16, 2019
3.19% Series A Senior Notes due October 16, 2019

3.19% Series A Senior Notes due October 16, 2019
3.19% Series A Senior Notes due October 16, 2019

3.19% Series A Senior Notes due October 16, 2019
3.75% Series B Senior Notes due October 16, 2022
3.75% Series B Senior Notes due October 16, 2022
3.75% Series B Senior Notes due October 16, 2022

3.75% Series B Senior Notes due October 16, 2022

3.75% Series B Senior Notes due October 16, 2022
3.75% Series B Senior Notes due October 16, 2022

3.75% Series B Senior Notes due October 16, 2022
3.90% Series C Senior Notes due October 16, 2024
3.90% Series C Senior Notes due October 16, 2024
3.90% Series C Senior Notes due October 16, 2024

3.90% Series C Senior Notes due October 16, 2024

3.90% Series C Senior Notes due October 16, 2024
3.90% Series C Senior Notes due October 16, 2024

3.90% Series C Senior Notes due October 16, 2024
German Private Placement (Schuldschein)
German Private Placement (Schuldschein)
German Private Placement (Schuldschein)

German Private Placement (Schuldschein)
German Private Placement (Schuldschein)

German Private Placement (Schuldschein)

German Private Placement (Schuldschein)
Total long-term debt
Total long-term debt
Total long-term debt

Total long-term debt
Total long-term debt

Total long-term debt

Total long-term debt
Less current portion
Less current portion
Less current portion

Less current portion

Less current portion
Less current portion

Less current portion
Long-term portion
Long-term portion
Long-term portion

Long-term portion

Long-term portion
Long-term portion

$ —
$ —
$ —

$ —

$ —
$ —

$ 427,445
$ 427,445
$ 427,445

$ 427,445

$ 427,445
$ 427,445

$ —
285,244
285,244
285,244
285,244

285,244
285,244

$ 427,445
279,492
279,492
279,492

279,492

279,492
279,492

285,244
347,995
347,995
347,995

347,995

347,995
347,995

279,492
335,201
335,201
335,201

335,201

335,201
335,201

347,995
413,272
413,272
413,272

413,272

413,272
413,272

335,201
397,793
397,793
397,793

397,793

397,793
397,793

413,272
—
—
—

—

—
—

—
302,040
302,040
302,040
302,040
302,040
302,040

302,040
26,944
26,944
26,944

26,944

26,944
26,944

397,793
72,483
72,483
72,483

72,483

72,483
72,483

72,483
298,691
298,691
298,691

298,691

298,691
298,691

298,691
26,933
26,933
26,933

26,933

26,933
26,933

26,944
330,857
330,857
330,857

330,857

330,857
330,857

26,933
336,168
336,168
336,168

336,168

336,168
336,168

330,857
$ 1,706,352
$ 1,706,352
$ 1,706,352
$ 1,706,352

$ 1,706,352
$ 1,706,352

336,168
$ 2,174,206
$ 2,174,206
$ 2,174,206
$ 2,174,206

$ 2,174,206
$ 2,174,206

$ 1,706,352
285,244
285,244
285,244

285,244

285,244
285,244

$ 2,174,206
503,116
503,116
503,116

503,116

503,116
503,116

285,244
$ 1,421,108
$ 1,421,108
$ 1,421,108
$ 1,421,108

$ 1,421,108
$ 1,421,108

503,116
$  1,671,090
$ 1,671,090
$ 1,671,090
$ 1,671,090

$ 1,671,090
$ 1,671,090

Long-term portion

$  1,671,090
Beginning on January 1, 2020 and ending at the close of business on March 31, 2020, the 2021 Notes became
Beginning on January 1, 2020 and ending at the close of business on March 31, 2020, the 2021 Notes became
Beginning on January 1, 2020 and ending at the close of business on March 31, 2020, the 2021 Notes became
Beginning on January 1, 2020 and ending at the close of business on March 31, 2020, the 2021 Notes became
Beginning on January 1, 2020 and ending at the close of business on March 31, 2020, the 2021 Notes became
Beginning on January 1, 2020 and ending at the close of business on March 31, 2020, the 2021 Notes became
convertible pursuant to the indenture as discussed below. The notes are all unsecured obligations that rank pari
convertible pursuant to the indenture as discussed below. The notes are all unsecured obligations that rank pari
convertible pursuant to the indenture as discussed below. The notes are all unsecured obligations that rank pari
convertible pursuant to the indenture as discussed below. The notes are all unsecured obligations that rank pari
convertible pursuant to the indenture as discussed below. The notes are all unsecured obligations that rank pari
convertible pursuant to the indenture as discussed below. The notes are all unsecured obligations that rank pari
Beginning on January 1, 2020 and ending at the close of business on March 31, 2020, the 2021 Notes became
passu. Interest expense on long-term debt was $68.0 million, $61.2 million and $43.6 million for the years ended
passu. Interest expense on long-term debt was $68.0 million, $61.2 million and $43.6 million for the years ended
passu. Interest expense on long-term debt was $68.0 million, $61.2 million and $43.6 million for the years ended
passu. Interest expense on long-term debt was $68.0 million, $61.2 million and $43.6 million for the years ended
passu. Interest expense on long-term debt was $68.0 million, $61.2 million and $43.6 million for the years ended
passu. Interest expense on long-term debt was $68.0 million, $61.2 million and $43.6 million for the years ended
convertible pursuant to the indenture as discussed below. The notes are all unsecured obligations that rank pari
December 31, 2019, 2018 and 2017, respectively.
December 31, 2019, 2018 and 2017, respectively.
December 31, 2019, 2018 and 2017, respectively.
December 31, 2019, 2018 and 2017, respectively.
December 31, 2019, 2018 and 2017, respectively.
December 31, 2019, 2018 and 2017, respectively.
passu. Interest expense on long-term debt was $68.0 million, $61.2 million and $43.6 million for the years ended
December 31, 2019, 2018 and 2017, respectively.

$ 1,421,108

Future maturities (stated at the carrying values) of long-term debt as of December 31, 2019, are as follows:

Future maturities (stated at the carrying values) of long-term debt as of December 31, 2019, are as follows:
Future maturities (stated at the carrying values) of long-term debt as of December 31, 2019, are as follows:

Future maturities (stated at the carrying values) of long-term debt as of December 31, 2019, are as follows:
Future maturities (stated at the carrying values) of long-term debt as of December 31, 2019, are as follows:
Future maturities (stated at the carrying values) of long-term debt as of December 31, 2019, are as follows:
Future maturities (stated at the carrying values) of long-term debt as of December 31, 2019, are as follows:

2020
2020
2020

2020

2020
2020

2020
2021
2021
2021

2021

2021
2021

2021
2022
2022
2022

2022

2022
2022

2022
2023
2023
2023

2023

2023
2023

2023
2024
2024
2024

2024

2024
2024

2024
thereafter
thereafter
thereafter

thereafter

thereafter
thereafter

$ 285,244
$ 285,244
$ 285,244

$ 285,244

$ 285,244
$ 285,244

$ 285,244
38,716
38,716
38,716

38,716

38,716
38,716

38,716
471,432
471,432
471,432

471,432

471,432
471,432

471,432
347,995
347,995
347,995

347,995

347,995
347,995

347,995
546,716
546,716
546,716

546,716

546,716
546,716

546,716
16,249
16,249
16,249

16,249

16,249
16,249

thereafter

16,249
$ 1,706,352
$ 1,706,352
$ 1,706,352
$ 1,706,352

$ 1,706,352
$ 1,706,352

$ 1,706,352

On March 19, 2014, we issued $730.0 million aggregate principal amount of Cash Convertible Senior Notes in
On March 19, 2014, we issued $730.0 million aggregate principal amount of Cash Convertible Senior Notes in
On March 19, 2014, we issued $730.0 million aggregate principal amount of Cash Convertible Senior Notes in
On March 19, 2014, we issued $730.0 million aggregate principal amount of Cash Convertible Senior Notes in
On March 19, 2014, we issued $730.0 million aggregate principal amount of Cash Convertible Senior Notes in
On March 19, 2014, we issued $730.0 million aggregate principal amount of Cash Convertible Senior Notes in
two tranches consisting of $430.0 million due in 2019 (2019 Notes) and $300.0 million due in 2021 (2021
two tranches consisting of $430.0 million due in 2019 (2019 Notes) and $300.0 million due in 2021 (2021
two tranches consisting of $430.0 million due in 2019 (2019 Notes) and $300.0 million due in 2021 (2021
two tranches consisting of $430.0 million due in 2019 (2019 Notes) and $300.0 million due in 2021 (2021
two tranches consisting of $430.0 million due in 2019 (2019 Notes) and $300.0 million due in 2021 (2021
two tranches consisting of $430.0 million due in 2019 (2019 Notes) and $300.0 million due in 2021 (2021
On March 19, 2014, we issued $730.0 million aggregate principal amount of Cash Convertible Senior Notes in
Notes). The aggregate net proceeds of the 2019 and 2021 Convertible Notes were $680.7 million, after payment
Notes). The aggregate net proceeds of the 2019 and 2021 Convertible Notes were $680.7 million, after payment
Notes). The aggregate net proceeds of the 2019 and 2021 Convertible Notes were $680.7 million, after payment
Notes). The aggregate net proceeds of the 2019 and 2021 Convertible Notes were $680.7 million, after payment
Notes). The aggregate net proceeds of the 2019 and 2021 Convertible Notes were $680.7 million, after payment
Notes). The aggregate net proceeds of the 2019 and 2021 Convertible Notes were $680.7 million, after payment
two tranches consisting of $430.0 million due in 2019 (2019 Notes) and $300.0 million due in 2021 (2021
of the net cost of the Call Spread Overlay described below and transaction costs. Additionally, we used $372.5
of the net cost of the Call Spread Overlay described below and transaction costs. Additionally, we used $372.5
of the net cost of the Call Spread Overlay described below and transaction costs. Additionally, we used $372.5
of the net cost of the Call Spread Overlay described below and transaction costs. Additionally, we used $372.5
of the net cost of the Call Spread Overlay described below and transaction costs. Additionally, we used $372.5
of the net cost of the Call Spread Overlay described below and transaction costs. Additionally, we used $372.5
Notes). The aggregate net proceeds of the 2019 and 2021 Convertible Notes were $680.7 million, after payment
million of the net proceeds to repay other debt. During the first quarter of 2019, $430.0 million was paid at maturity
million of the net proceeds to repay other debt. During the first quarter of 2019, $430.0 million was paid at maturity
million of the net proceeds to repay other debt. During the first quarter of 2019, $430.0 million was paid at maturity
million of the net proceeds to repay other debt. During the first quarter of 2019, $430.0 million was paid at maturity
million of the net proceeds to repay other debt. During the first quarter of 2019, $430.0 million was paid at maturity
million of the net proceeds to repay other debt. During the first quarter of 2019, $430.0 million was paid at maturity
of the net cost of the Call Spread Overlay described below and transaction costs. Additionally, we used $372.5
(2019 Notes) and $3.4 million of the 2021 Notes was redeemed.
(2019 Notes) and $3.4 million of the 2021 Notes was redeemed.
(2019 Notes) and $3.4 million of the 2021 Notes was redeemed.
(2019 Notes) and $3.4 million of the 2021 Notes was redeemed.
(2019 Notes) and $3.4 million of the 2021 Notes was redeemed.
(2019 Notes) and $3.4 million of the 2021 Notes was redeemed.
million of the net proceeds to repay other debt. During the first quarter of 2019, $430.0 million was paid at maturity
(2019 Notes) and $3.4 million of the 2021 Notes was redeemed.

On September 13, 2017, we issued $400.0 million aggregate principal amount of Cash Convertible Senior Notes
On September 13, 2017, we issued $400.0 million aggregate principal amount of Cash Convertible Senior Notes
On September 13, 2017, we issued $400.0 million aggregate principal amount of Cash Convertible Senior Notes
which is due in 2023 (2023 Notes). The net proceeds of the 2023 Notes were $365.6 million, after payment of the
which is due in 2023 (2023 Notes). The net proceeds of the 2023 Notes were $365.6 million, after payment of the
which is due in 2023 (2023 Notes). The net proceeds of the 2023 Notes were $365.6 million, after payment of the
On September 13, 2017, we issued $400.0 million aggregate principal amount of Cash Convertible Senior Notes
net cost of the Call Spread Overlay described below and transaction costs paid.
net cost of the Call Spread Overlay described below and transaction costs paid.
which is due in 2023 (2023 Notes). The net proceeds of the 2023 Notes were $365.6 million, after payment of the

On September 13, 2017, we issued $400.0 million aggregate principal amount of Cash Convertible Senior Notes
which is due in 2023 (2023 Notes). The net proceeds of the 2023 Notes were $365.6 million, after payment of the
net cost of the Call Spread Overlay described below and transaction costs paid.

On September 13, 2017, we issued $400.0 million aggregate principal amount of Cash Convertible Senior Notes
On September 13, 2017, we issued $400.0 million aggregate principal amount of Cash Convertible Senior Notes
which is due in 2023 (2023 Notes). The net proceeds of the 2023 Notes were $365.6 million, after payment of the
which is due in 2023 (2023 Notes). The net proceeds of the 2023 Notes were $365.6 million, after payment of the
net cost of the Call Spread Overlay described below and transaction costs paid.
net cost of the Call Spread Overlay described below and transaction costs paid.

186

Cash Convertible Notes due 2019, 2021, 2023 and 2024(in thousands)20192018Year ending December 31,(in thousands)Cash Convertible Notes due 2019, 2021, 2023 and 2024(in thousands)20192018Year ending December 31,(in thousands)Cash Convertible Notes due 2019, 2021, 2023 and 2024(in thousands)20192018Year ending December 31,(in thousands)Cash Convertible Notes due 2019, 2021, 2023 and 2024(in thousands)20192018Year ending December 31,(in thousands)Cash Convertible Notes due 2019, 2021, 2023 and 2024(in thousands)20192018Year ending December 31,(in thousands)Cash Convertible Notes due 2019, 2021, 2023 and 2024(in thousands)20192018Year ending December 31,(in thousands)Cash Convertible Notes due 2019, 2021, 2023 and 2024(in thousands)20192018Year ending December 31,(in thousands)During 2019, we repaid $506.4 million of long-term debt including $430.0 million for the amount due for the 2019

Cash Convertible Notes, $73.0 million for amounts due for the U.S. Private Placement and $3.4 million for a portion

of the 2021 Cash Convertible Notes which was converted during the contingent conversion period as discussed

further below.

At December 31, 2019 and 2018, total current long-term debt, net of debt issuance costs of $10.8 million and

$14.2 million, respectively, consists of the following:

0.375% Senior Unsecured Cash Convertible Notes due 2019

$ —

$ 427,445

0.875% Senior Unsecured Cash Convertible Notes due 2021

0.500% Senior Unsecured Cash Convertible Notes due 2023

1.000% Senior Unsecured Cash Convertible Notes due 2024

3.19% Series A Senior Notes due October 16, 2019

3.75% Series B Senior Notes due October 16, 2022

3.90% Series C Senior Notes due October 16, 2024

German Private Placement (Schuldschein)

Total long-term debt

Less current portion

Long-term portion

2020

2021

2022

2023

2024

thereafter

285,244

347,995

413,272

—

302,040

26,944

330,857

279,492

335,201

397,793

72,483

298,691

26,933

336,168

$ 1,706,352

$ 2,174,206

285,244

503,116

$ 1,421,108

$  1,671,090

$ 285,244

38,716

471,432

347,995

546,716

16,249

$ 1,706,352

Beginning on January 1, 2020 and ending at the close of business on March 31, 2020, the 2021 Notes became

convertible pursuant to the indenture as discussed below. The notes are all unsecured obligations that rank pari

passu. Interest expense on long-term debt was $68.0 million, $61.2 million and $43.6 million for the years ended

December 31, 2019, 2018 and 2017, respectively.

Future maturities (stated at the carrying values) of long-term debt as of December 31, 2019, are as follows:

F I N A N C I A L   R E S U LT S Notes to consolidated financial statements
On March 19, 2014, we issued $730.0 million aggregate principal amount of Cash Convertible Senior Notes in
two tranches consisting of $430.0 million due in 2019 (2019 Notes) and $300.0 million due in 2021 (2021
Notes). The aggregate net proceeds of the 2019 and 2021 Convertible Notes were $680.7 million, after payment
of the net cost of the Call Spread Overlay described below and transaction costs. Additionally, we used $372.5
million of the net proceeds to repay other debt. During the first quarter of 2019, $430.0 million was paid at maturity
(2019 Notes) and $3.4 million of the 2021 Notes was redeemed.

On September 13, 2017, we issued $400.0 million aggregate principal amount of Cash Convertible Senior Notes
which is due in 2023 (2023 Notes). The net proceeds of the 2023 Notes were $365.6 million, after payment of the
net cost of the Call Spread Overlay described below and transaction costs paid.

On November 13, 2018, we issued $500.0 million aggregate principal amount of Cash Convertible Senior Notes
which is due in 2024 (2024 Notes). The net proceeds of the 2024 Notes were $468.9 million, after payment of the
net cost of the Call Spread Overlay described below and transaction costs paid through December 31, 2019.

We refer to the 2019 Notes, 2021 Notes 2023 Notes and 2024 Notes, collectively as the “Cash Convertible
Notes”.

Interest on the Cash Convertible Notes is payable semi-annually in arrears and will mature on the maturity date
unless repurchased or converted with their terms prior to such date. The interest rate and corresponding maturity of
each Note are summarized in the table below. The Cash Convertible Notes are solely convertible into cash in whole,
but not in part, at the option of noteholders under the circumstances described below and during the contingent
conversion periods as shown in the table below.

2021 Notes

0.875%

2023 Notes

0.500%

2024 Notes

1.000%

March 19 and
September 19

March 13 and
September 13

May 13 and
November 13

March 19, 2021

From April 29, 2014 to September 18, 2020

7,063.1647

September 13, 2023

From October 24, 2017 to March 13, 2023

4,829.7279

November 13, 2024

From December 24, 2018 to August 2, 2024

4,360.3098

Additionally, conversion may occur at any time following a Contingent Conversion Period through the fifth business
day immediately preceding the applicable maturity date.

Upon conversion, noteholders will receive an amount in cash equal to the Cash Settlement Amount, calculated as
described below. The Cash Convertible Notes are not convertible into shares of our common stock or any other
securities.

Noteholders may convert of the Cash Convertible Notes into cash at their option at any time during the Contingent
Conversion Periods described above only under the following circumstances (Contingent Conversion Conditions):

›

if the last reported sale price of our common stock for at least 20-consecutive trading days during a period of 30-
consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater
than or equal to 130% of the conversion price on each applicable trading day;

›

if we undergo certain fundamental changes as defined in the agreement;

›

›

›

during the five-business day period immediately after any 10 consecutive trading day period in which the quoted
price for the 2021 Notes for each trading day of the measurement period was less than 98% of the product of the
last reported sale price of our common stock and the conversion rate on each such trading day;

if parity event or trading price unavailability event, as the case maybe occurs for the 2023 Notes and 2024 Notes
during the period of 10 days, including the first business day following the relevant trading price notification date.

if we elect to distribute assets or property to all or substantially all of the holders of our common stock and those
assets or other property have a value of more than 25% of the average daily volume-weighted average trading
price of our common stock for the prior 20 consecutive trading days;

›

if we elect to redeem the Cash Convertible Notes; or

187

›

if we experience certain customary events of default, including defaults under certain other indebtedness until such
event has been cured or waived or the payment of the Notes have been accelerated.

Cash Convertible Notes due 2019, 2021, 2023 and 2024(in thousands)20192018Year ending December 31,(in thousands)Cash ConvertibleNotesAnnualInterest RateDate of InterestPaymentsMaturity DateContingent Conversion PeriodConversion Rate per$200,000 PrincipalAmountnet cost of the Call Spread Overlay described below and transaction costs paid.

On November 13, 2018, we issued $500.0 million aggregate principal amount of Cash Convertible Senior Notes

which is due in 2024 (2024 Notes). The net proceeds of the 2024 Notes were $468.9 million, after payment of the

net cost of the Call Spread Overlay described below and transaction costs paid through December 31, 2019.

We refer to the 2019 Notes, 2021 Notes 2023 Notes and 2024 Notes, collectively as the “Cash Convertible

Notes”.

Interest on the Cash Convertible Notes is payable semi-annually in arrears and will mature on the maturity date

unless repurchased or converted with their terms prior to such date. The interest rate and corresponding maturity of

each Note are summarized in the table below. The Cash Convertible Notes are solely convertible into cash in whole,

but not in part, at the option of noteholders under the circumstances described below and during the contingent

conversion periods as shown in the table below.

2021 Notes

0.875%

March 19, 2021

From April 29, 2014 to September 18, 2020

7,063.1647

2023 Notes

0.500%

March 13 and

September 13, 2023

From October 24, 2017 to March 13, 2023

4,829.7279

2024 Notes

1.000%

May 13 and

November 13, 2024

From December 24, 2018 to August 2, 2024

4,360.3098

March 19 and

September 19

September 13

November 13

Additionally, conversion may occur at any time following a Contingent Conversion Period through the fifth business

day immediately preceding the applicable maturity date.

Upon conversion, noteholders will receive an amount in cash equal to the Cash Settlement Amount, calculated as

described below. The Cash Convertible Notes are not convertible into shares of our common stock or any other

securities.

Noteholders may convert of the Cash Convertible Notes into cash at their option at any time during the Contingent

Conversion Periods described above only under the following circumstances (Contingent Conversion Conditions):

›

if the last reported sale price of our common stock for at least 20-consecutive trading days during a period of 30-

consecutive trading days ending on the last trading day of the immediately preceding calendar quarter is greater

than or equal to 130% of the conversion price on each applicable trading day;

›

if we undergo certain fundamental changes as defined in the agreement;

›

›

›

during the five-business day period immediately after any 10 consecutive trading day period in which the quoted
price for the 2021 Notes for each trading day of the measurement period was less than 98% of the product of the
last reported sale price of our common stock and the conversion rate on each such trading day;

if parity event or trading price unavailability event, as the case maybe occurs for the 2023 Notes and 2024 Notes
during the period of 10 days, including the first business day following the relevant trading price notification date.

if we elect to distribute assets or property to all or substantially all of the holders of our common stock and those
assets or other property have a value of more than 25% of the average daily volume-weighted average trading
price of our common stock for the prior 20 consecutive trading days;

›

if we elect to redeem the Cash Convertible Notes; or

›

if we experience certain customary events of default, including defaults under certain other indebtedness until such
event has been cured or waived or the payment of the Notes have been accelerated.

The Contingent Conversion Conditions in the 2021, 2023 and 2024 Notes noted above have been analyzed under
ASC 815, Derivatives and Hedging, and, based on our analysis, we determined that each of the embedded features
listed above are clearly and closely related to the 2021, 2023 and 2024 Notes (i.e., the host contracts). As a result,
pursuant to the accounting provisions of ASC 815, Derivatives and Hedging, these features noted above are not
required to be bifurcated as separate instruments.

Beginning on January 1, 2020 and ending at the close of business on March 31, 2020, the 2021 Notes became
convertible pursuant to the indenture. The 2021 Notes became convertible pursuant to Section 12.01(b)(iv) of the
indenture because the arithmetic mean of the last reported sale prices of our common stock, in each trading day in at
least one 20-consecutive trading day period during the 30-consecutive trading day period ending on the last trading
day of the preceding fiscal quarter, was greater than 130% of the conversion price in effect on such last trading day.

No Contingent Conversion Conditions were triggered for the 2023 Notes and 2024 Notes as of December 31,
2019.

Upon conversion, holders are entitled to a cash payment (Cash Settlement Amount) equal to the average of the
conversion rate multiplied by the daily volume-weighted average trading price for our common stock over a 50-day
period. The conversion rate is subject to adjustment in certain instances but will not be adjusted for any accrued and
unpaid interest. In addition, following the occurrence of certain corporate events that may occur prior to the
applicable maturity date, we may be required to pay a cash make-whole premium by increasing the conversion rate
for any holder who elects to convert Cash Convertible Notes in connection with the occurrence of such a corporate
event.

We may redeem the Cash Convertible Notes in their entirety at a price equal to 100% of the principal amount of the
applicable Cash Convertible Notes plus accrued interest at any time when 20% or less of the aggregate principal
amount of the applicable Cash Convertible Notes originally issued remain outstanding.

Because the Cash Convertible Notes contain an embedded cash conversion option, we have determined that the
embedded cash conversion option is a derivative financial instrument, which is required to be separated from the
Cash Convertible Notes and accounted for separately as a derivative liability, with changes in fair value reported in
our consolidated statements of income until the cash conversion option transaction settles or expires. The initial fair
value liability of the embedded cash conversion option for the 2019 and 2021 Notes was $51.2 million and $54.0
million, respectively, $74.5 million for the 2023 Notes, and $98.5 million for the 2024 Notes, which simultaneously
reduced the carrying value of the Cash Convertible Notes (effectively an original issuance discount). For further
discussion of the derivative financial instruments relating to the Cash Convertible Notes, refer to Note 14 "Derivatives
and Hedging".

As noted above, the reduced carrying value on the Cash Convertible Notes resulted in a debt discount that is
amortized to the principal amount through the recognition of non-cash interest expense using the effective interest
method over the expected life of the debt, which is five and seven for the 2019 Notes and 2021 Notes, and six
years for the 2023 Notes and 2024 Notes, respectively. This resulted in our recognition of interest expense on the
Cash Convertible Notes at an effective rate approximating what we would have incurred had nonconvertible debt
with otherwise similar terms been issued. The effective interest rate of the 2019 Notes, 2021 Notes, 2023 Notes
and 2024 Notes is 2.937%, 3.809%, 3.997% and 4.782% respectively, which is imputed based on the
amortization of the fair value of the embedded cash conversion option over the remaining term of the Cash
188
Convertible Notes.

In connection with the issuance of the 2019 and 2021 Cash Convertible Notes, we incurred approximately $13.1

million in transaction costs. We incurred approximately $6.2 million in transaction costs for the 2023 Cash

Convertible Notes. For 2024 Cash Convertible Notes, we incurred $5.7 million transaction costs of which $0.2

million was accrued as of December 31, 2019. Such costs have been allocated to the Cash Convertible Notes and

deferred and are being amortized to interest expense over the terms of the Cash Convertible Notes using the

effective interest method.

Interest expense related to the Cash Convertible Notes was comprised of the following:

Cash ConvertibleNotesAnnualInterest RateDate of InterestPaymentsMaturity DateContingent Conversion PeriodConversion Rate per$200,000 PrincipalAmountThe Contingent Conversion Conditions in the 2021, 2023 and 2024 Notes noted above have been analyzed under

ASC 815, Derivatives and Hedging, and, based on our analysis, we determined that each of the embedded features

listed above are clearly and closely related to the 2021, 2023 and 2024 Notes (i.e., the host contracts). As a result,

pursuant to the accounting provisions of ASC 815, Derivatives and Hedging, these features noted above are not

required to be bifurcated as separate instruments.

Beginning on January 1, 2020 and ending at the close of business on March 31, 2020, the 2021 Notes became

convertible pursuant to the indenture. The 2021 Notes became convertible pursuant to Section 12.01(b)(iv) of the

indenture because the arithmetic mean of the last reported sale prices of our common stock, in each trading day in at

least one 20-consecutive trading day period during the 30-consecutive trading day period ending on the last trading

day of the preceding fiscal quarter, was greater than 130% of the conversion price in effect on such last trading day.

No Contingent Conversion Conditions were triggered for the 2023 Notes and 2024 Notes as of December 31,

2019.

event.

Upon conversion, holders are entitled to a cash payment (Cash Settlement Amount) equal to the average of the

conversion rate multiplied by the daily volume-weighted average trading price for our common stock over a 50-day

period. The conversion rate is subject to adjustment in certain instances but will not be adjusted for any accrued and

unpaid interest. In addition, following the occurrence of certain corporate events that may occur prior to the

applicable maturity date, we may be required to pay a cash make-whole premium by increasing the conversion rate

for any holder who elects to convert Cash Convertible Notes in connection with the occurrence of such a corporate

We may redeem the Cash Convertible Notes in their entirety at a price equal to 100% of the principal amount of the

applicable Cash Convertible Notes plus accrued interest at any time when 20% or less of the aggregate principal

amount of the applicable Cash Convertible Notes originally issued remain outstanding.

Because the Cash Convertible Notes contain an embedded cash conversion option, we have determined that the

embedded cash conversion option is a derivative financial instrument, which is required to be separated from the
Cash Convertible Notes and accounted for separately as a derivative liability, with changes in fair value reported in
our consolidated statements of income until the cash conversion option transaction settles or expires. The initial fair
F I N A N C I A L   R E S U LT S Notes to consolidated financial statements
value liability of the embedded cash conversion option for the 2019 and 2021 Notes was $51.2 million and $54.0
million, respectively, $74.5 million for the 2023 Notes, and $98.5 million for the 2024 Notes, which simultaneously
reduced the carrying value of the Cash Convertible Notes (effectively an original issuance discount). For further
discussion of the derivative financial instruments relating to the Cash Convertible Notes, refer to Note 14 "Derivatives
and Hedging".

As noted above, the reduced carrying value on the Cash Convertible Notes resulted in a debt discount that is
amortized to the principal amount through the recognition of non-cash interest expense using the effective interest
method over the expected life of the debt, which is five and seven for the 2019 Notes and 2021 Notes, and six
years for the 2023 Notes and 2024 Notes, respectively. This resulted in our recognition of interest expense on the
Cash Convertible Notes at an effective rate approximating what we would have incurred had nonconvertible debt
with otherwise similar terms been issued. The effective interest rate of the 2019 Notes, 2021 Notes, 2023 Notes
and 2024 Notes is 2.937%, 3.809%, 3.997% and 4.782% respectively, which is imputed based on the
amortization of the fair value of the embedded cash conversion option over the remaining term of the Cash
Convertible Notes.

In connection with the issuance of the 2019 and 2021 Cash Convertible Notes, we incurred approximately $13.1
million in transaction costs. We incurred approximately $6.2 million in transaction costs for the 2023 Cash
Convertible Notes. For 2024 Cash Convertible Notes, we incurred $5.7 million transaction costs of which $0.2
million was accrued as of December 31, 2019. Such costs have been allocated to the Cash Convertible Notes and
deferred and are being amortized to interest expense over the terms of the Cash Convertible Notes using the
effective interest method.

Interest expense related to the Cash Convertible Notes was comprised of the following:

Coupon interest
Coupon interest

Coupon interest

Coupon interest

Coupon interest
Amortization of original issuance discount
Amortization of original issuance discount

Amortization of original issuance discount

Amortization of original issuance discount

Amortization of original issuance discount
Amortization of debt issuance costs
Amortization of debt issuance costs

Amortization of debt issuance costs

Amortization of debt issuance costs

Amortization of debt issuance costs
Total interest expense related to the Cash Convertible Notes
Total interest expense related to the Cash Convertible Notes

Total interest expense related to the Cash Convertible Notes

Total interest expense related to the Cash Convertible Notes

$ 9,954
$ 9,954

$ 9,954

$ 9,954

$ 6,890
$ 6,890

$ 6,890

$ 6,890

$ 9,954
36,966
36,966

36,966

36,966

$ 6,890
32,114
32,114

32,114

32,114

36,966
3,014
3,014

3,014

3,014

32,114
3,485
3,485

3,485

3,485

3,014
$ 49,934
$ 49,934

$ 49,934

$ 49,934

3,485
$ 42,489
$ 42,489

$ 42,489

$ 42,489

Total interest expense related to the Cash Convertible Notes

$ 49,934

$ 42,489

Concurrent with the issuance of the Cash Convertible Notes, we entered into privately negotiated hedge transactions
Concurrent with the issuance of the Cash Convertible Notes, we entered into privately negotiated hedge transactions
(Call Options) with, and issued warrants to purchase shares of our common stock (Warrants) to, certain financial
(Call Options) with, and issued warrants to purchase shares of our common stock (Warrants) to, certain financial
institutions. We refer to the Call Options and Warrants collectively as the “Call Spread Overlay”. The Call Options
institutions. We refer to the Call Options and Warrants collectively as the “Call Spread Overlay”. The Call Options
are intended to offset any cash payments payable by us in excess of the principal amount due upon any conversion
are intended to offset any cash payments payable by us in excess of the principal amount due upon any conversion
of the Cash Convertible Notes. During 2014, we used $105.2 million of the proceeds from the issuance of the 2019
of the Cash Convertible Notes. During 2014, we used $105.2 million of the proceeds from the issuance of the 2019
and 2021 Cash Convertible Notes to pay for the Call Options, and simultaneously received $69.4 million from the
and 2021 Cash Convertible Notes to pay for the Call Options, and simultaneously received $69.4 million from the
sale of the Warrants, for a net cash outlay of $35.8 million for the Call Spread Overlay.
sale of the Warrants, for a net cash outlay of $35.8 million for the Call Spread Overlay.

Concurrent with the issuance of the Cash Convertible Notes, we entered into privately negotiated hedge transactions
Concurrent with the issuance of the Cash Convertible Notes, we entered into privately negotiated hedge transactions
(Call Options) with, and issued warrants to purchase shares of our common stock (Warrants) to, certain financial
(Call Options) with, and issued warrants to purchase shares of our common stock (Warrants) to, certain financial
Concurrent with the issuance of the Cash Convertible Notes, we entered into privately negotiated hedge transactions
institutions. We refer to the Call Options and Warrants collectively as the “Call Spread Overlay”. The Call Options
institutions. We refer to the Call Options and Warrants collectively as the “Call Spread Overlay”. The Call Options
(Call Options) with, and issued warrants to purchase shares of our common stock (Warrants) to, certain financial
are intended to offset any cash payments payable by us in excess of the principal amount due upon any conversion
are intended to offset any cash payments payable by us in excess of the principal amount due upon any conversion
institutions. We refer to the Call Options and Warrants collectively as the “Call Spread Overlay”. The Call Options
of the Cash Convertible Notes. During 2014, we used $105.2 million of the proceeds from the issuance of the 2019
of the Cash Convertible Notes. During 2014, we used $105.2 million of the proceeds from the issuance of the 2019
are intended to offset any cash payments payable by us in excess of the principal amount due upon any conversion
and 2021 Cash Convertible Notes to pay for the Call Options, and simultaneously received $69.4 million from the
and 2021 Cash Convertible Notes to pay for the Call Options, and simultaneously received $69.4 million from the
of the Cash Convertible Notes. During 2014, we used $105.2 million of the proceeds from the issuance of the 2019
sale of the Warrants, for a net cash outlay of $35.8 million for the Call Spread Overlay.
sale of the Warrants, for a net cash outlay of $35.8 million for the Call Spread Overlay.
and 2021 Cash Convertible Notes to pay for the Call Options, and simultaneously received $69.4 million from the
sale of the Warrants, for a net cash outlay of $35.8 million for the Call Spread Overlay.

During 2017, we used $73.7 million of the proceeds from the from the issuance of the 2023 Cash Convertible
During 2017, we used $73.7 million of the proceeds from the from the issuance of the 2023 Cash Convertible
During 2017, we used $73.7 million of the proceeds from the from the issuance of the 2023 Cash Convertible
During 2017, we used $73.7 million of the proceeds from the from the issuance of the 2023 Cash Convertible
Notes to pay for the premium for the Call Option, and simultaneously received $45.3 million from the sale of
Notes to pay for the premium for the Call Option, and simultaneously received $45.3 million from the sale of
Notes to pay for the premium for the Call Option, and simultaneously received $45.3 million from the sale of
Notes to pay for the premium for the Call Option, and simultaneously received $45.3 million from the sale of
During 2017, we used $73.7 million of the proceeds from the from the issuance of the 2023 Cash Convertible
Warrants, for a net cash outlay of $28.3 million for the Call Spread Overlay. Issuance costs incurred in connection
Warrants, for a net cash outlay of $28.3 million for the Call Spread Overlay. Issuance costs incurred in connection
Warrants, for a net cash outlay of $28.3 million for the Call Spread Overlay. Issuance costs incurred in connection
Warrants, for a net cash outlay of $28.3 million for the Call Spread Overlay. Issuance costs incurred in connection
Notes to pay for the premium for the Call Option, and simultaneously received $45.3 million from the sale of
with the Warrant and the Call Option were $0.3 million and $0.1 million respectively.
with the Warrant and the Call Option were $0.3 million and $0.1 million respectively.
with the Warrant and the Call Option were $0.3 million and $0.1 million respectively.
with the Warrant and the Call Option were $0.3 million and $0.1 million respectively.
Warrants, for a net cash outlay of $28.3 million for the Call Spread Overlay. Issuance costs incurred in connection
with the Warrant and the Call Option were $0.3 million and $0.1 million respectively.

In November 2018, we used $97.3 million of the proceeds from the from the issuance of the 2024 Cash Convertible
In November 2018, we used $97.3 million of the proceeds from the from the issuance of the 2024 Cash Convertible
In November 2018, we used $97.3 million of the proceeds from the from the issuance of the 2024 Cash Convertible
In November 2018, we used $97.3 million of the proceeds from the from the issuance of the 2024 Cash Convertible
Notes to pay for the premium for the Call Option, and simultaneously received $72.4 million from the sale of
Notes to pay for the premium for the Call Option, and simultaneously received $72.4 million from the sale of
Notes to pay for the premium for the Call Option, and simultaneously received $72.4 million from the sale of
Notes to pay for the premium for the Call Option, and simultaneously received $72.4 million from the sale of
In November 2018, we used $97.3 million of the proceeds from the from the issuance of the 2024 Cash Convertible
Warrants, for a net cash outlay of $24.9 million for the Call Spread Overlay. Issuance costs incurred in connection
Warrants, for a net cash outlay of $24.9 million for the Call Spread Overlay. Issuance costs incurred in connection
Warrants, for a net cash outlay of $24.9 million for the Call Spread Overlay. Issuance costs incurred in connection
Warrants, for a net cash outlay of $24.9 million for the Call Spread Overlay. Issuance costs incurred in connection
Notes to pay for the premium for the Call Option, and simultaneously received $72.4 million from the sale of
with the Warrant and the Call Option were $0.5 million and $0.5 million respectively, of which $48.0 thousand
with the Warrant and the Call Option were $0.5 million and $0.5 million respectively, of which $48.0 thousand
with the Warrant and the Call Option were $0.5 million and $0.5 million respectively, of which $48.0 thousand
with the Warrant and the Call Option were $0.5 million and $0.5 million respectively, of which $48.0 thousand
Warrants, for a net cash outlay of $24.9 million for the Call Spread Overlay. Issuance costs incurred in connection
was accrued as of December 31, 2019.
was accrued as of December 31, 2019.
was accrued as of December 31, 2019.
was accrued as of December 31, 2019.
with the Warrant and the Call Option were $0.5 million and $0.5 million respectively, of which $48.0 thousand
was accrued as of December 31, 2019.

The Call Options are derivative financial instruments and are discussed further in Note 14 "Derivatives and
The Call Options are derivative financial instruments and are discussed further in Note 14 "Derivatives and
The Call Options are derivative financial instruments and are discussed further in Note 14 "Derivatives and
The Call Options are derivative financial instruments and are discussed further in Note 14 "Derivatives and
Hedging". The Warrants are equity instruments and are further discussed in Note 18 "Equity".
Hedging". The Warrants are equity instruments and are further discussed in Note 18 "Equity".
Hedging". The Warrants are equity instruments and are further discussed in Note 18 "Equity".
Hedging". The Warrants are equity instruments and are further discussed in Note 18 "Equity".
The Call Options are derivative financial instruments and are discussed further in Note 14 "Derivatives and
Hedging". The Warrants are equity instruments and are further discussed in Note 18 "Equity".

Aside from the initial payment of a premium of $105.2 million (2019 and 2021 Notes), $73.7 million (2023
Aside from the initial payment of a premium of $105.2 million (2019 and 2021 Notes), $73.7 million (2023
Notes), and $97.3 million (2024 Notes) for the Call Option, we will not be required to make any cash payments
Notes), and $97.3 million (2024 Notes) for the Call Option, we will not be required to make any cash payments
Aside from the initial payment of a premium of $105.2 million (2019 and 2021 Notes), $73.7 million (2023
under the Call Options, and will be entitled to receive an amount of cash, generally equal to the amount by which
under the Call Options, and will be entitled to receive an amount of cash, generally equal to the amount by which
Notes), and $97.3 million (2024 Notes) for the Call Option, we will not be required to make any cash payments

Aside from the initial payment of a premium of $105.2 million (2019 and 2021 Notes), $73.7 million (2023
Aside from the initial payment of a premium of $105.2 million (2019 and 2021 Notes), $73.7 million (2023
189
Notes), and $97.3 million (2024 Notes) for the Call Option, we will not be required to make any cash payments
Notes), and $97.3 million (2024 Notes) for the Call Option, we will not be required to make any cash payments
under the Call Options, and will be entitled to receive an amount of cash, generally equal to the amount by which
under the Call Options, and will be entitled to receive an amount of cash, generally equal to the amount by which

the market price per share of our common stock exceeds the exercise price of the Call Options during the relevant

the market price per share of our common stock exceeds the exercise price of the Call Options during the relevant

the market price per share of our common stock exceeds the exercise price of the Call Options during the relevant

the market price per share of our common stock exceeds the exercise price of the Call Options during the relevant

under the Call Options, and will be entitled to receive an amount of cash, generally equal to the amount by which

valuation period. The exercise price under the Call Options is initially equal to the conversion price of the Cash

valuation period. The exercise price under the Call Options is initially equal to the conversion price of the Cash

valuation period. The exercise price under the Call Options is initially equal to the conversion price of the Cash

valuation period. The exercise price under the Call Options is initially equal to the conversion price of the Cash

the market price per share of our common stock exceeds the exercise price of the Call Options during the relevant

Convertible Notes.

Convertible Notes.

Convertible Notes.

Convertible Notes.

valuation period. The exercise price under the Call Options is initially equal to the conversion price of the Cash

Convertible Notes.

During the first quarter of 2019, we received $133.2 million in cash upon the exercise of the call options in

During the first quarter of 2019, we received $133.2 million in cash upon the exercise of the call options in

During the first quarter of 2019, we received $133.2 million in cash upon the exercise of the call options in

During the first quarter of 2019, we received $133.2 million in cash upon the exercise of the call options in

connection with the repayment of the 2019 Notes. In the same transaction, we paid $132.7 million for the intrinsic

connection with the repayment of the 2019 Notes. In the same transaction, we paid $132.7 million for the intrinsic

connection with the repayment of the 2019 Notes. In the same transaction, we paid $132.7 million for the intrinsic

connection with the repayment of the 2019 Notes. In the same transaction, we paid $132.7 million for the intrinsic

During the first quarter of 2019, we received $133.2 million in cash upon the exercise of the call options in

value of the 2019 Notes' embedded cash conversion option. Not all of the 2019 Note holders tendered the

value of the 2019 Notes' embedded cash conversion option. Not all of the 2019 Note holders tendered the

value of the 2019 Notes' embedded cash conversion option. Not all of the 2019 Note holders tendered the

value of the 2019 Notes' embedded cash conversion option. Not all of the 2019 Note holders tendered the

connection with the repayment of the 2019 Notes. In the same transaction, we paid $132.7 million for the intrinsic

required conversion notice, and as a result the net effect of the cash paid and received of $0.5 million was

required conversion notice, and as a result the net effect of the cash paid and received of $0.5 million was

required conversion notice, and as a result the net effect of the cash paid and received of $0.5 million was

required conversion notice, and as a result the net effect of the cash paid and received of $0.5 million was

value of the 2019 Notes' embedded cash conversion option. Not all of the 2019 Note holders tendered the

recognized as a gain in other income, net.

recognized as a gain in other income, net.

recognized as a gain in other income, net.

recognized as a gain in other income, net.

required conversion notice, and as a result the net effect of the cash paid and received of $0.5 million was

recognized as a gain in other income, net.

In connection with the early conversion of a portion of the 2021 Notes during the first quarter of 2019, we received

In connection with the early conversion of a portion of the 2021 Notes during the first quarter of 2019, we received

In connection with the early conversion of a portion of the 2021 Notes during the first quarter of 2019, we received

In connection with the early conversion of a portion of the 2021 Notes during the first quarter of 2019, we received

$0.4 million in cash and recorded an other receivable of $0.7 million upon the exercise of the related call options.

$0.4 million in cash and recorded an other receivable of $0.7 million upon the exercise of the related call options.

$0.4 million in cash and recorded an other receivable of $0.7 million upon the exercise of the related call options.

$0.4 million in cash and recorded an other receivable of $0.7 million upon the exercise of the related call options.

In connection with the early conversion of a portion of the 2021 Notes during the first quarter of 2019, we received

In the same transaction, we paid $1.1 million for the intrinsic value of the 2021 Notes' embedded cash conversion

In the same transaction, we paid $1.1 million for the intrinsic value of the 2021 Notes' embedded cash conversion

In the same transaction, we paid $1.1 million for the intrinsic value of the 2021 Notes' embedded cash conversion

In the same transaction, we paid $1.1 million for the intrinsic value of the 2021 Notes' embedded cash conversion

$0.4 million in cash and recorded an other receivable of $0.7 million upon the exercise of the related call options.

option. During the second quarter of 2019, we collected the $0.7 million receivable balance and received $0.4

option. During the second quarter of 2019, we collected the $0.7 million receivable balance and received $0.4

option. During the second quarter of 2019, we collected the $0.7 million receivable balance and received $0.4

option. During the second quarter of 2019, we collected the $0.7 million receivable balance and received $0.4

In the same transaction, we paid $1.1 million for the intrinsic value of the 2021 Notes' embedded cash conversion

million in cash upon the exercise of additional call options. As a result of these early conversions, we have

million in cash upon the exercise of additional call options. As a result of these early conversions, we have

million in cash upon the exercise of additional call options. As a result of these early conversions, we have

million in cash upon the exercise of additional call options. As a result of these early conversions, we have

option. During the second quarter of 2019, we collected the $0.7 million receivable balance and received $0.4

recognized a $0.4 million gain in other income, net.

recognized a $0.4 million gain in other income, net.

recognized a $0.4 million gain in other income, net.

recognized a $0.4 million gain in other income, net.

million in cash upon the exercise of additional call options. As a result of these early conversions, we have

recognized a $0.4 million gain in other income, net.

Cash Convertible Notes Call Spread Overlay(in thousands)Year-Ended December 3120192018Cash Convertible Notes Call Spread Overlay(in thousands)Year-Ended December 3120192018Cash Convertible Notes Call Spread Overlay(in thousands)Year-Ended December 3120192018Cash Convertible Notes Call Spread Overlay(in thousands)Year-Ended December 3120192018Cash Convertible Notes Call Spread Overlay(in thousands)Year-Ended December 3120192018Coupon interest

Amortization of original issuance discount

Amortization of debt issuance costs

$ 9,954

36,966

3,014

$ 6,890

32,114

3,485

Total interest expense related to the Cash Convertible Notes

$ 49,934

$ 42,489

Concurrent with the issuance of the Cash Convertible Notes, we entered into privately negotiated hedge transactions

(Call Options) with, and issued warrants to purchase shares of our common stock (Warrants) to, certain financial

institutions. We refer to the Call Options and Warrants collectively as the “Call Spread Overlay”. The Call Options

are intended to offset any cash payments payable by us in excess of the principal amount due upon any conversion

of the Cash Convertible Notes. During 2014, we used $105.2 million of the proceeds from the issuance of the 2019

and 2021 Cash Convertible Notes to pay for the Call Options, and simultaneously received $69.4 million from the

sale of the Warrants, for a net cash outlay of $35.8 million for the Call Spread Overlay.

During 2017, we used $73.7 million of the proceeds from the from the issuance of the 2023 Cash Convertible

Notes to pay for the premium for the Call Option, and simultaneously received $45.3 million from the sale of

Warrants, for a net cash outlay of $28.3 million for the Call Spread Overlay. Issuance costs incurred in connection
with the Warrant and the Call Option were $0.3 million and $0.1 million respectively.

In November 2018, we used $97.3 million of the proceeds from the from the issuance of the 2024 Cash Convertible
Notes to pay for the premium for the Call Option, and simultaneously received $72.4 million from the sale of
Warrants, for a net cash outlay of $24.9 million for the Call Spread Overlay. Issuance costs incurred in connection
with the Warrant and the Call Option were $0.5 million and $0.5 million respectively, of which $48.0 thousand
was accrued as of December 31, 2019.

The Call Options are derivative financial instruments and are discussed further in Note 14 "Derivatives and
Hedging". The Warrants are equity instruments and are further discussed in Note 18 "Equity".

Aside from the initial payment of a premium of $105.2 million (2019 and 2021 Notes), $73.7 million (2023
Notes), and $97.3 million (2024 Notes) for the Call Option, we will not be required to make any cash payments
under the Call Options, and will be entitled to receive an amount of cash, generally equal to the amount by which
the market price per share of our common stock exceeds the exercise price of the Call Options during the relevant
valuation period. The exercise price under the Call Options is initially equal to the conversion price of the Cash
Convertible Notes.

During the first quarter of 2019, we received $133.2 million in cash upon the exercise of the call options in
connection with the repayment of the 2019 Notes. In the same transaction, we paid $132.7 million for the intrinsic
value of the 2019 Notes' embedded cash conversion option. Not all of the 2019 Note holders tendered the
required conversion notice, and as a result the net effect of the cash paid and received of $0.5 million was
recognized as a gain in other income, net.

In connection with the early conversion of a portion of the 2021 Notes during the first quarter of 2019, we received
$0.4 million in cash and recorded an other receivable of $0.7 million upon the exercise of the related call options.
In the same transaction, we paid $1.1 million for the intrinsic value of the 2021 Notes' embedded cash conversion
option. During the second quarter of 2019, we collected the $0.7 million receivable balance and received $0.4
million in cash upon the exercise of additional call options. As a result of these early conversions, we have
recognized a $0.4 million gain in other income, net.

The Warrants that were issued with our Cash Convertible Notes, could have a dilutive effect to the extent that the
price of our common stock exceeds the applicable strike price of the Warrants. For each Warrant that is exercised,
we will deliver to the holder a number of shares of our common stock equal to the amount by which the settlement
price exceeds the exercise price, plus cash in lieu of any fractional shares. We will not receive any proceeds if the
Warrants are exercised.

In October 2012, we completed a private placement through the issuance of new senior unsecured notes at a total
amount of $400.0 million with a weighted average interest rate of 3.66% (settled on October 16, 2012). The notes
were issued in three series: (1) $73.0 million 7-year term due and paid in 2019 (3.19%); (2) $300.0 million 10-
year term due in 2022 (3.75%); and (3) $27.0 million 12-year term due in 2024 (3.90%). We paid $2.1 million in
debt issuance costs which will be amortized through interest expense using the effective interest method over the
lifetime of the notes. The note purchase agreement contains certain financial and non-financial covenants, including
but not limited to, restrictions on priority indebtedness and the maintenance of certain financial ratios. We were in
compliance with these covenants at December 31, 2019. Based on an estimation using the changes in the U.S.
Treasury rates, the Level 2 fair value of these senior notes as of December 31, 2019 and December 31, 2018 was
approximately $329.2 million and $391.7 million, respectively. During 2014, we entered into interest rate swaps,
which effectively fixed the fair value of $200.0 million of this debt, which was reduced to $127.0 million following
the 2019 $73.0 million repayment. These interest rate swaps qualify for hedge accounting as fair value hedges as
described in Note 14 "Derivatives and Hedging".

In 2017, we completed a German private placement bond ("Schuldschein") which was issued in several tranches
totaling $331.1 million due in various periods through 2027. The Schuldschein consists of U.S. dollar and Euro
denominated tranches. The Euro tranches are designated as a foreign currency non-derivative hedging instrument
that qualifies as a net investment hedge as described in Note 14 "Derivatives and Hedging". Based on the spot rate
method, the change in the carrying value of the Euro denominated tranches attributed to the net investment hedge as
of December 31, 2019 totaled $0.4 million of unrealized loss and is recorded in equity. We paid $1.2 million in
190
debt issuance costs which are being amortized through interest expense over the lifetime of the notes. A summary of
the tranches as of December 31, 2019 and December 31, 2018 is as follows:

€11.5 million

€23.0 million

€21.5 million

€64.5 million

$45.0 million

€25.0 million

€64.0 million

€31.0 million

€14.5 million

EUR

EUR

EUR

EUR

EUR

EUR

EUR

EUR

EUR

EUR

Fixed 0.4%

March 2021

$ 12,905

$  13,143

Floating EURIBOR + 0.4%

March 2021

Fixed 0.68%

October 2022

Floating EURIBOR + 0.5%

October 2022

Floating LIBOR + 1.2%

October 2022

Floating EURIBOR + 0.5%

October 2022

Fixed 1.09%

June 2024

Floating EURIBOR + 0.7%

June 2024

Fixed 1.61%

June 2027

25,811

24,112

72,335

44,919

28,026

71,747

34,753

16,249

26,286

24,561

73,684

44,891

28,543

73,097

35,406

16,557

$ 330,857

$ 336,168

The financial markets regulators in the United Kingdom and the Eurozone have passed regulations that will become

effective in 2021 under which LIBOR and EURIBOR in their current form will not be compliant. Market participants

and regulators are working on establishing new interest rate benchmarks. While the outcome of this work is not clear

yet, the Schuldschein our syndicated loan facility, and our interest rate swaps continue to make reference to the

current LIBOR and EURIBOR benchmark rates. These agreements contain language for the determination of interest

Cash Convertible Notes Call Spread Overlay(in thousands)Year-Ended December 3120192018U.S. Private PlacementGerman Private Placement (Schuldschein)CurrencyNotional AmountInterest RateMaturityCarrying Value (in thousands) as ofDecember 31, 2019December 31, 2018F I N A N C I A L   R E S U LT S Notes to consolidated financial statements

The Warrants that were issued with our Cash Convertible Notes, could have a dilutive effect to the extent that the
price of our common stock exceeds the applicable strike price of the Warrants. For each Warrant that is exercised,
we will deliver to the holder a number of shares of our common stock equal to the amount by which the settlement
price exceeds the exercise price, plus cash in lieu of any fractional shares. We will not receive any proceeds if the
Warrants are exercised.

In October 2012, we completed a private placement through the issuance of new senior unsecured notes at a total
amount of $400.0 million with a weighted average interest rate of 3.66% (settled on October 16, 2012). The notes
were issued in three series: (1) $73.0 million 7-year term due and paid in 2019 (3.19%); (2) $300.0 million 10-
year term due in 2022 (3.75%); and (3) $27.0 million 12-year term due in 2024 (3.90%). We paid $2.1 million in
debt issuance costs which will be amortized through interest expense using the effective interest method over the
lifetime of the notes. The note purchase agreement contains certain financial and non-financial covenants, including
but not limited to, restrictions on priority indebtedness and the maintenance of certain financial ratios. We were in
compliance with these covenants at December 31, 2019. Based on an estimation using the changes in the U.S.
Treasury rates, the Level 2 fair value of these senior notes as of December 31, 2019 and December 31, 2018 was
approximately $329.2 million and $391.7 million, respectively. During 2014, we entered into interest rate swaps,
which effectively fixed the fair value of $200.0 million of this debt, which was reduced to $127.0 million following
the 2019 $73.0 million repayment. These interest rate swaps qualify for hedge accounting as fair value hedges as
described in Note 14 "Derivatives and Hedging".

In 2017, we completed a German private placement bond ("Schuldschein") which was issued in several tranches
totaling $331.1 million due in various periods through 2027. The Schuldschein consists of U.S. dollar and Euro
denominated tranches. The Euro tranches are designated as a foreign currency non-derivative hedging instrument
that qualifies as a net investment hedge as described in Note 14 "Derivatives and Hedging". Based on the spot rate
method, the change in the carrying value of the Euro denominated tranches attributed to the net investment hedge as
of December 31, 2019 totaled $0.4 million of unrealized loss and is recorded in equity. We paid $1.2 million in
debt issuance costs which are being amortized through interest expense over the lifetime of the notes. A summary of
the tranches as of December 31, 2019 and December 31, 2018 is as follows:

€11.5 million

€23.0 million

€21.5 million

€64.5 million

$45.0 million

€25.0 million

€64.0 million

€31.0 million

€14.5 million

EUR

EUR

EUR

EUR

EUR

EUR

EUR

EUR

EUR

EUR

Fixed 0.4%

March 2021

$ 12,905

$  13,143

Floating EURIBOR + 0.4%

March 2021

Fixed 0.68%

October 2022

Floating EURIBOR + 0.5%

October 2022

Floating LIBOR + 1.2%

October 2022

Floating EURIBOR + 0.5%

October 2022

Fixed 1.09%

June 2024

Floating EURIBOR + 0.7%

June 2024

Fixed 1.61%

June 2027

25,811

24,112

72,335

44,919

28,026

71,747

34,753

16,249

26,286

24,561

73,684

44,891

28,543

73,097

35,406

16,557

$ 330,857

$ 336,168

The financial markets regulators in the United Kingdom and the Eurozone have passed regulations that will become
effective in 2021 under which LIBOR and EURIBOR in their current form will not be compliant. Market participants
and regulators are working on establishing new interest rate benchmarks. While the outcome of this work is not clear
yet, the Schuldschein our syndicated loan facility, and our interest rate swaps continue to make reference to the
current LIBOR and EURIBOR benchmark rates. These agreements contain language for the determination of interest

191

U.S. Private PlacementGerman Private Placement (Schuldschein)CurrencyNotional AmountInterest RateMaturityCarrying Value (in thousands) as ofDecember 31, 2019December 31, 2018rates in case the benchmark rate is not available. However, it appears likely that the agreements will need to be
rates in case the benchmark rate is not available. However, it appears likely that the agreements will need to be
rates in case the benchmark rate is not available. However, it appears likely that the agreements will need to be
rates in case the benchmark rate is not available. However, it appears likely that the agreements will need to be
rates in case the benchmark rate is not available. However, it appears likely that the agreements will need to be
adjusted in line with still to be developed market practice once new benchmark rates become available.
adjusted in line with still to be developed market practice once new benchmark rates become available.
adjusted in line with still to be developed market practice once new benchmark rates become available.
adjusted in line with still to be developed market practice once new benchmark rates become available.
adjusted in line with still to be developed market practice once new benchmark rates become available.

17. Income Taxes
17. Income Taxes

17. Income Taxes
17. Income Taxes
17. Income Taxes

(Loss) income before income taxes for the years ended December 31, 2019, 2018 and 2017 consisted of:
(Loss) income before income taxes for the years ended December 31, 2019, 2018 and 2017 consisted of:

(Loss) income before income taxes for the years ended December 31, 2019, 2018 and 2017 consisted of:
(Loss) income before income taxes for the years ended December 31, 2019, 2018 and 2017 consisted of:
(Loss) income before income taxes for the years ended December 31, 2019, 2018 and 2017 consisted of:

rates in case the benchmark rate is not available. However, it appears likely that the agreements will need to be
rates in case the benchmark rate is not available. However, it appears likely that the agreements will need to be
rates in case the benchmark rate is not available. However, it appears likely that the agreements will need to be
rates in case the benchmark rate is not available. However, it appears likely that the agreements will need to be
$  17,455
Pretax income in The Netherlands
$ 17,455
adjusted in line with still to be developed market practice once new benchmark rates become available.
adjusted in line with still to be developed market practice once new benchmark rates become available.
adjusted in line with still to be developed market practice once new benchmark rates become available.
adjusted in line with still to be developed market practice once new benchmark rates become available.

Pretax income in The Netherlands
Pretax income in The Netherlands

Pretax income in The Netherlands
Pretax income in The Netherlands

$  (1,675)
$ (1,675)

$  42,220
$ 42,220

$ 17,455
$ 17,455

$ 17,455

$ (1,675)
$ (1,675)

$ (1,675)

$ 42,220

$ 42,220
$ 42,220

Pretax (loss) income from foreign operations
Pretax (loss) income from foreign operations

Pretax (loss) income from foreign operations

Pretax (loss) income from foreign operations
Pretax (loss) income from foreign operations

(95,231)
(95,231)

(95,231)

(95,231)
(95,231)

227,412
227,412

227,412

227,412
227,412

72,155
72,155

72,155

72,155
72,155

17. Income Taxes

17. Income Taxes
17. Income Taxes
17. Income Taxes

$ (77,776)
$ (77,776)

$ (77,776)

$ (77,776)
$ (77,776)

$  225,737
$ 225,737

$ 225,737

$ 225,737
$ 225,737

$  114,375
$ 114,375

$ 114,375

$ 114,375
$ 114,375

Income tax (benefit) expense for the years ended December 31, 2019, 2018 and 2017 are as follows:
Income tax (benefit) expense for the years ended December 31, 2019, 2018 and 2017 are as follows:
(Loss) income before income taxes for the years ended December 31, 2019, 2018 and 2017 consisted of:

Income tax (benefit) expense for the years ended December 31, 2019, 2018 and 2017 are as follows:
Income tax (benefit) expense for the years ended December 31, 2019, 2018 and 2017 are as follows:
Income tax (benefit) expense for the years ended December 31, 2019, 2018 and 2017 are as follows:
(Loss) income before income taxes for the years ended December 31, 2019, 2018 and 2017 consisted of:
(Loss) income before income taxes for the years ended December 31, 2019, 2018 and 2017 consisted of:
(Loss) income before income taxes for the years ended December 31, 2019, 2018 and 2017 consisted of:

Current—The Netherlands
Pretax income in The Netherlands
Current—The Netherlands

Pretax income in The Netherlands
Current—The Netherlands

Pretax income in The Netherlands
Pretax income in The Netherlands
Current—The Netherlands
Current—The Netherlands

Pretax (loss) income from foreign operations

Pretax (loss) income from foreign operations

Pretax (loss) income from foreign operations
Pretax (loss) income from foreign operations

—Foreign
—Foreign

—Foreign

—Foreign
—Foreign

$ 5,670
$ 17,455
$ 5,670

$ 17,455
$ 17,455
$ 17,455
$ 5,670
$ 5,670
$ 5,670

$ 5,794
$ (1,675)
$ 5,794

$ (1,675)
$ (1,675)
$ (1,675)
$ 5,794
$ 5,794
$ 5,794

$ 3,430
$ 42,220
$ 3,430

$ 42,220
$ 42,220
$ 42,220
$ 3,430
$ 3,430
$ 3,430

13,371
(95,231)
13,371

(95,231)
(95,231)
(95,231)
13,371
13,371
13,371

52,835
227,412
52,835

227,412
227,412
227,412
52,835
52,835
52,835

10,375
72,155
10,375

72,155
10,375

72,155
72,155
10,375
10,375

$ (77,776)
19,041
19,041

$ (77,776)
$ (77,776)
$ (77,776)
19,041
19,041
19,041

$ 225,737
58,629
58,629

$ 225,737
$ 225,737
$ 225,737
58,629
58,629
58,629

$ 114,375
13,805
13,805

$ 114,375
$ 114,375
$ 114,375
13,805
13,805
13,805

Deferred—The Netherlands
Deferred—The Netherlands

Income tax (benefit) expense for the years ended December 31, 2019, 2018 and 2017 are as follows:

Deferred—The Netherlands
Income tax (benefit) expense for the years ended December 31, 2019, 2018 and 2017 are as follows:
Income tax (benefit) expense for the years ended December 31, 2019, 2018 and 2017 are as follows:
Income tax (benefit) expense for the years ended December 31, 2019, 2018 and 2017 are as follows:

Deferred—The Netherlands
Deferred—The Netherlands

4,177
4,177

2,551
2,551

2,551
2,551

4,177
4,177

2,551

4,177

151
151

151

151
151

—Foreign
—Foreign

—Foreign

—Foreign
—Foreign

(59,539)
(59,539)

(59,539)

(59,539)
(59,539)

(25,823)
(25,823)

(25,823)

(25,823)
(25,823)

60,025
60,025

60,025

60,025
60,025

(55,362)
(55,362)

(55,362)

(55,362)
(55,362)

(23,272)
(23,272)

(23,272)

(23,272)
(23,272)

60,176
60,176

60,176

60,176
60,176

Total income tax (benefit) expense
Total income tax (benefit) expense

Total income tax (benefit) expense

Total income tax (benefit) expense
Total income tax (benefit) expense

$ (36,321)
$ (36,321)

$ (36,321)

$ (36,321)
$ (36,321)

$ 35,357
$ 35,357

$ 35,357

$ 35,357
$ 35,357

$ 73,981
$ 73,981

$ 73,981

$ 73,981
$ 73,981

—Foreign

—Foreign

—Foreign
—Foreign

Current—The Netherlands

Current—The Netherlands
Current—The Netherlands

Current—The Netherlands
$ 5,670
The Netherlands statutory income tax rate was 25% for the years ended December 31, 2019, 2018 and 2017.
The Netherlands statutory income tax rate was 25% for the years ended December 31, 2019, 2018 and 2017.
The Netherlands statutory income tax rate was 25% for the years ended December 31, 2019, 2018 and 2017.
The Netherlands statutory income tax rate was 25% for the years ended December 31, 2019, 2018 and 2017.
The Netherlands statutory income tax rate was 25% for the years ended December 31, 2019, 2018 and 2017.
13,371
Income from foreign subsidiaries is generally taxed at the statutory income tax rates applicable in the respective
Income from foreign subsidiaries is generally taxed at the statutory income tax rates applicable in the respective
Income from foreign subsidiaries is generally taxed at the statutory income tax rates applicable in the respective
Income from foreign subsidiaries is generally taxed at the statutory income tax rates applicable in the respective
Income from foreign subsidiaries is generally taxed at the statutory income tax rates applicable in the respective
countries of domicile. The principal items comprising the differences between income taxes computed at The
countries of domicile. The principal items comprising the differences between income taxes computed at The
countries of domicile. The principal items comprising the differences between income taxes computed at The
countries of domicile. The principal items comprising the differences between income taxes computed at The
countries of domicile. The principal items comprising the differences between income taxes computed at The
13,805
13,805
19,041
Netherlands statutory rate and our reported income taxes and effective tax rate for the years ended December 31,
Netherlands statutory rate and our reported income taxes and effective tax rate for the years ended December 31,
Netherlands statutory rate and our reported income taxes and effective tax rate for the years ended December 31,
Netherlands statutory rate and our reported income taxes and effective tax rate for the years ended December 31,
Netherlands statutory rate and our reported income taxes and effective tax rate for the years ended December 31,
Deferred—The Netherlands
Deferred—The Netherlands
Deferred—The Netherlands
151
4,177
2019, 2018 and 2017 are as follows:
2019, 2018 and 2017 are as follows:
2019, 2018 and 2017 are as follows:
2019, 2018 and 2017 are as follows:
2019, 2018 and 2017 are as follows:

Deferred—The Netherlands

$ 5,794
$ 5,794

$ 5,670
$ 5,670

$ 3,430

$ 5,794

$ 5,670

$ 5,794

$ 3,430

13,371
13,371

52,835
52,835

19,041
19,041

58,629
58,629

10,375

19,041

58,629

13,371

52,835

58,629

52,835

10,375

4,177
4,177

2,551
2,551

2,551

4,177

2,551

151

$ 3,430
$ 3,430

10,375
10,375

13,805
13,805

151
151

—Foreign

—Foreign

—Foreign
—Foreign

(59,539)

(59,539)

(59,539)
(59,539)

(25,823)

(25,823)

(25,823)
(25,823)

60,025

60,025

60,025
60,025

(55,362)

(55,362)

(55,362)
(55,362)

(23,272)

(23,272)

(23,272)
(23,272)

60,176

60,176

60,176
60,176

Total income tax (benefit) expense

Total income tax (benefit) expense

Total income tax (benefit) expense
Total income tax (benefit) expense

$ (36,321)

$ (36,321)

$ (36,321)
$ (36,321)

$ 35,357

$ 35,357

$ 35,357
$ 35,357

$ 73,981

$ 73,981

$ 73,981
$ 73,981

The Netherlands statutory income tax rate was 25% for the years ended December 31, 2019, 2018 and 2017.
Income from foreign subsidiaries is generally taxed at the statutory income tax rates applicable in the respective
countries of domicile. The principal items comprising the differences between income taxes computed at The
Netherlands statutory rate and our reported income taxes and effective tax rate for the years ended December 31,
2019, 2018 and 2017 are as follows:

The Netherlands statutory income tax rate was 25% for the years ended December 31, 2019, 2018 and 2017.
The Netherlands statutory income tax rate was 25% for the years ended December 31, 2019, 2018 and 2017.
The Netherlands statutory income tax rate was 25% for the years ended December 31, 2019, 2018 and 2017.
Income from foreign subsidiaries is generally taxed at the statutory income tax rates applicable in the respective
Income from foreign subsidiaries is generally taxed at the statutory income tax rates applicable in the respective
Income from foreign subsidiaries is generally taxed at the statutory income tax rates applicable in the respective
countries of domicile. The principal items comprising the differences between income taxes computed at The
countries of domicile. The principal items comprising the differences between income taxes computed at The
countries of domicile. The principal items comprising the differences between income taxes computed at The
Netherlands statutory rate and our reported income taxes and effective tax rate for the years ended December 31,
Netherlands statutory rate and our reported income taxes and effective tax rate for the years ended December 31,
Netherlands statutory rate and our reported income taxes and effective tax rate for the years ended December 31,
2019, 2018 and 2017 are as follows:
2019, 2018 and 2017 are as follows:
2019, 2018 and 2017 are as follows:

192

(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017(in thousands)201920182017F I N A N C I A L   R E S U LT S Notes to consolidated financial statements

Income taxes at The Netherlands statutory rate
Income taxes at The Netherlands statutory rate

Income taxes at The Netherlands statutory rate
Income taxes at The Netherlands statutory rate
Income taxes at The Netherlands statutory rate

$ (19,444)
$ (19,444 )

$ (19,444 )
$ (19,444 )
$ (19,444 )

25.0 %
25.0 %

25.0 %
25.0 %
25.0 %

$ 56,434
$ 56,434

$ 56,434
$ 56,434
$ 56,434

25.0 %
25.0 %

25.0 %
25.0 %
25.0 %

$ 28,594
$ 28,594

$ 28,594
$ 28,594
$ 28,594

25.0 %
25.0 %

25.0 %
25.0 %
25.0 %

Income taxes at The Netherlands statutory rate
Taxation of foreign operations, net(1)
Taxation of foreign operations, net(1)
Taxation of foreign operations, net(1)
Taxation of foreign operations, net(1)
Taxation of foreign operations, net(1)
Taxation of foreign operations, net(1)
Tax impact from intangible property transfer
Tax impact from intangible property transfer

Tax impact from intangible property transfer
Tax impact from intangible property transfer
Tax impact from intangible property transfer

Unrecognized tax benefits(2)
Unrecognized tax benefits(2)
Unrecognized tax benefits(2)

Tax impact from intangible property transfer
Unrecognized tax benefits(2)
Unrecognized tax benefits(2)
Unrecognized tax benefits(2)
Tax impact from nondeductible items
Tax impact from nondeductible items

Tax impact from nondeductible items
Tax impact from nondeductible items
Tax impact from nondeductible items

Tax impact from nondeductible items
Excess tax benefit related to share-based compensation
Excess tax benefit related to share-based compensation

Excess tax benefit related to share-based compensation
Excess tax benefit related to share-based compensation
Excess tax benefit related to share-based compensation

Excess tax benefit related to share-based compensation
Government incentives and other deductions(4)
Government incentives and other deductions(4)
Government incentives and other deductions(4)
Government incentives and other deductions(4)
Government incentives and other deductions(4)
Government incentives and other deductions(4)
Changes in tax laws and rates(3)
Changes in tax laws and rates(3)
Changes in tax laws and rates(3)
Other items, net
Other items, net

Changes in tax laws and rates(3)
Changes in tax laws and rates(3)
Changes in tax laws and rates(3)

Other items, net
Other items, net
Other items, net

Valuation allowance(3)
Valuation allowance(3)
Valuation allowance(3)

Other items, net
Valuation allowance(3)
Valuation allowance(3)
Valuation allowance(3)

$ (19,444)
(25,720)
(25,720)

(25,720)
(25,720)
(25,720)

25.0 %
33.1
33.1

33.1
33.1
33.1

$ 56,434
(33,994)
(33,994)

(33,994)
(33,994)
(33,994)

25.0 %
(15.1)
(15.1)

(15.1)
(15.1)
(15.1)

$ 28,594
(38,635)
(38,635)

(38,635)
(38,635)
(38,635)

(25,720)
(21,122)
(21,122)

(21,122)
(21,122)
(21,122)

(21,122)
10,962
10,962

10,962
10,962
10,962

10,962
7,986
7,986

7,986
7,986
7,986

7,986
(3,989)
(3,989)
(3,989)
(3,989)
(3,989)

(3,989)
(7,516)
(7,516)

(7,516)
(7,516)
(7,516)

(7,516)
331
331

331
331
331

331
1,306
1,306
1,306
1,306
1,306

1,306
20,885
20,885
20,885
20,885
20,885

33.1
27.2
27.2

27.2
27.2
27.2

(33,994)
—
—

—
—
—

(15.1)
—
—

—
—
—

(38,635)
—
—

—
—
—

27.2
(14.1)
(14.1)
(14.1)
(14.1)
(14.1)

(14.1)
(10.3)
(10.3)

(10.3)
(10.3)
(10.3)

(10.3)
5.1
5.1

5.1
5.1
5.1

5.1
9.7
9.7

9.7
9.7
9.7

9.7
(0.4)
(0.4)

(0.4)
(0.4)
(0.4)

(0.4)
(1.7)
(1.7)

(1.7)
(1.7)
(1.7)

(1.7)
(26.9)
(26.9)
(26.9)
(26.9)
(26.9)

—
13,570
13,570
13,570
13,570
13,570

13,570
2,949
2,949

2,949
2,949
2,949

2,949
(4,740)
(4,740)
(4,740)
(4,740)
(4,740)

(4,740)
(2,892)
(2,892)

(2,892)
(2,892)
(2,892)

(2,892)
1,907
1,907

1,907
1,907
1,907

1,907
(1,170)
(1,170)
(1,170)
(1,170)
(1,170)

(1,170)
3,293
3,293

3,293
3,293
3,293

—
6.0
6.0

6.0
6.0
6.0

6.0
1.3
1.3

1.3
1.3
1.3

1.3
(2.1)
(2.1)

(2.1)
(2.1)
(2.1)

(2.1)
(1.2)
(1.2)

(1.2)
(1.2)
(1.2)

(1.2)
0.8
0.8

0.8
0.8
0.8

0.8
(0.5)
(0.5)

(0.5)
(0.5)
(0.5)

(0.5)
1.5
1.5

1.5
1.5
1.5

—
23,189
23,189
23,189
23,189
23,189

23,189
2,645
2,645

2,645
2,645
2,645

2,645
(5,237)
(5,237)
(5,237)
(5,237)
(5,237)

(5,237)
(6,519)
(6,519)

(6,519)
(6,519)
(6,519)

(6,519)
12,958
12,958

12,958
12,958
12,958

12,958
(5,658)
(5,658)

(5,658)
(5,658)
(5,658)

(5,658)
62,644
62,644

62,644
62,644
62,644

25.0 %
(33.8)
(33.8)

(33.8)
(33.8)
(33.8)

(33.8)
—
—

—
—
—

—
20.3
20.3
20.3
20.3
20.3

20.3
2.3
2.3

2.3
2.3
2.3

2.3
(4.6)
(4.6)

(4.6)
(4.6)
(4.6)

(4.6)
(5.7)
(5.7)

(5.7)
(5.7)
(5.7)

(5.7)
11.3
11.3

11.3
11.3
11.3

11.3
(4.9)
(4.9)

(4.9)
(4.9)
(4.9)

(4.9)
54.8
54.8

54.8
54.8
54.8

20,885
$ (36,321)
$ (36,321)
$ (36,321)
$ (36,321)
$ (36,321)

(26.9)
46.7 %
46.7 %

46.7 %
46.7 %
46.7 %

3,293
$ 35,357
$ 35,357
$ 35,357
$ 35,357
$ 35,357

1.5
15.7 %
15.7 %
15.7 %
15.7 %
15.7 %

62,644
$ 73,981
$ 73,981
$ 73,981
$ 73,981
$ 73,981

54.8
64.7 %
64.7 %
64.7 %
64.7 %
64.7 %

46.7 %

15.7 %

$ 73,981

$ 35,357

64.7 %
$ (36,321)
(1) Our effective tax rate reflects the benefit of our global operations where certain income or loss is taxed at rates higher or
(1) Our effective tax rate reflects the benefit of our global operations where certain income or loss is taxed at rates higher
(1) Our effective tax rate reflects the benefit of our global operations where certain income or loss is taxed at rates higher
(1) Our effective tax rate reflects the benefit of our global operations where certain income or loss is taxed at rates higher
(1) Our effective tax rate reflects the benefit of our global operations where certain income or loss is taxed at rates higher
lower than The Netherlands’ statutory rate of 25% as well as the benefit of some income being partially exempt from income
or lower than The Netherlands’ statutory rate of 25% as well as the benefit of some income being partially exempt from
or lower than The Netherlands’ statutory rate of 25% as well as the benefit of some income being partially exempt from
or lower than The Netherlands’ statutory rate of 25% as well as the benefit of some income being partially exempt from
or lower than The Netherlands’ statutory rate of 25% as well as the benefit of some income being partially exempt from
(1) Our effective tax rate reflects the benefit of our global operations where certain income or loss is taxed at rates higher or
taxes due to various intercompany operating and financing activities. The most significant tax benefits from these foreign
income taxes due to various intercompany operating and financing activities. The most significant tax benefits from these
income taxes due to various intercompany operating and financing activities. The most significant tax benefits from these
income taxes due to various intercompany operating and financing activities. The most significant tax benefits from these
income taxes due to various intercompany operating and financing activities. The most significant tax benefits from these
lower than The Netherlands’ statutory rate of 25% as well as the benefit of some income being partially exempt from income
operating and financing activities are attributable to subsidiaries in Germany, Singapore, Switzerland, Ireland, Dubai, and
foreign operating and financing activities are attributable to subsidiaries in Germany, Singapore, Switzerland, Ireland,
foreign operating and financing activities are attributable to subsidiaries in Germany, Singapore, Switzerland, Ireland,
foreign operating and financing activities are attributable to subsidiaries in Germany, Singapore, Switzerland, Ireland,
foreign operating and financing activities are attributable to subsidiaries in Germany, Singapore, Switzerland, Ireland,
taxes due to various intercompany operating and financing activities. The most significant tax benefits from these foreign
Luxembourg. These foreign tax benefits are due to a combination of favorable tax laws, regulations, rulings, and exemptions
Dubai, and Luxembourg. These foreign tax benefits are due to a combination of favorable tax laws, regulations, rulings,
Dubai, and Luxembourg. These foreign tax benefits are due to a combination of favorable tax laws, regulations, rulings,
Dubai, and Luxembourg. These foreign tax benefits are due to a combination of favorable tax laws, regulations, rulings,
Dubai, and Luxembourg. These foreign tax benefits are due to a combination of favorable tax laws, regulations, rulings,
operating and financing activities are attributable to subsidiaries in Germany, Singapore, Switzerland, Ireland, Dubai, and
in these jurisdictions.
and exemptions in these jurisdictions.
and exemptions in these jurisdictions.
and exemptions in these jurisdictions.
and exemptions in these jurisdictions.
Luxembourg. These foreign tax benefits are due to a combination of favorable tax laws, regulations, rulings, and exemptions
in these jurisdictions.
(2) During 2019, we reassessed accruals for tax contingencies, primarily related to ongoing income tax audits.
(2) During 2019, we reassessed accruals for tax contingencies, primarily related to ongoing income tax audits.
(2) During 2019, we reassessed accruals for tax contingencies, primarily related to ongoing income tax audits.
(3) The Netherlands' top statutory corporate income tax rate will be reduced to 21.7% from 25% beginning in 2021. Valuation
(3) The Netherlands' top statutory corporate income tax rate will be reduced to 21.7% from 25% beginning in 2021.
(3) The Netherlands' top statutory corporate income tax rate will be reduced to 21.7% from 25% beginning in 2021.
(3) The Netherlands' top statutory corporate income tax rate will be reduced to 21.7% from 25% beginning in 2021.
(3) The Netherlands' top statutory corporate income tax rate will be reduced to 21.7% from 25% beginning in 2021.
allowance related to U.S. disallowed interest totaled $12.7 million in 2019 and $60.5 million in 2017.
Valuation allowance related to U.S. disallowed interest totaled $12.7 million in 2019 and $60.5 million in 2017.
Valuation allowance related to U.S. disallowed interest totaled $12.7 million in 2019 and $60.5 million in 2017.
Valuation allowance related to U.S. disallowed interest totaled $12.7 million in 2019 and $60.5 million in 2017.
Valuation allowance related to U.S. disallowed interest totaled $12.7 million in 2019 and $60.5 million in 2017.
(3) The Netherlands' top statutory corporate income tax rate will be reduced to 21.7% from 25% beginning in 2021. Valuation
allowance related to U.S. disallowed interest totaled $12.7 million in 2019 and $60.5 million in 2017.
(4) Government incentives include favorable tax regulations in the U.S., Spain and the U.K. relating to research and
(4) Government incentives include favorable tax regulations in the U.S., Spain and the U.K. relating to research and
development expense and other government incentives.
development expense and other government incentives.
(4) Government incentives include favorable tax regulations in the U.S., Spain and the U.K. relating to research and
development expense and other government incentives.

(4) Government incentives include favorable tax regulations in the U.S., Spain and the U.K. relating to research and
(4) Government incentives include favorable tax regulations in the U.S., Spain and the U.K. relating to research and
(4) Government incentives include favorable tax regulations in the U.S., Spain and the U.K. relating to research and
development expense and other government incentives.
development expense and other government incentives.
development expense and other government incentives.

(2) During 2019, we reassessed accruals for tax contingencies, primarily related to ongoing income tax audits.
(2) During 2019, we reassessed accruals for tax contingencies, primarily related to ongoing income tax audits.
(2) During 2019, we reassessed accruals for tax contingencies, primarily related to ongoing income tax audits.

We conduct business globally and, as a result, file numerous consolidated and separate income tax returns in The
We conduct business globally and, as a result, file numerous consolidated and separate income tax returns in The
We conduct business globally and, as a result, file numerous consolidated and separate income tax returns in The
We conduct business globally and, as a result, file numerous consolidated and separate income tax returns in The
We conduct business globally and, as a result, file numerous consolidated and separate income tax returns in The
We conduct business globally and, as a result, file numerous consolidated and separate income tax returns in The
Netherlands, Germany, and the U.S. federal jurisdiction, as well as in various other state and foreign jurisdictions. In
Netherlands, Germany, and the U.S. federal jurisdiction, as well as in various other state and foreign jurisdictions. In
Netherlands, Germany, and the U.S. federal jurisdiction, as well as in various other state and foreign jurisdictions. In
Netherlands, Germany, and the U.S. federal jurisdiction, as well as in various other state and foreign jurisdictions. In
Netherlands, Germany, and the U.S. federal jurisdiction, as well as in various other state and foreign jurisdictions. In
Netherlands, Germany, and the U.S. federal jurisdiction, as well as in various other state and foreign jurisdictions. In
the normal course of business, we are subject to examination by taxing authorities throughout the world. Tax years in
the normal course of business, we are subject to examination by taxing authorities throughout the world. Tax years in
the normal course of business, we are subject to examination by taxing authorities throughout the world. Tax years in
the normal course of business, we are subject to examination by taxing authorities throughout the world. Tax years in
the normal course of business, we are subject to examination by taxing authorities throughout the world. Tax years in
the normal course of business, we are subject to examination by taxing authorities throughout the world. Tax years in
The Netherlands are potentially open back to 2007 for income tax examinations by tax authorities. The German
The Netherlands are potentially open back to 2007 for income tax examinations by tax authorities. The German
The Netherlands are potentially open back to 2007 for income tax examinations by tax authorities. The German
The Netherlands are potentially open back to 2007 for income tax examinations by tax authorities. The German
The Netherlands are potentially open back to 2007 for income tax examinations by tax authorities. The German
The Netherlands are potentially open back to 2007 for income tax examinations by tax authorities. The German
group is open to audit for the tax years starting in 2014 and in 2019, the German tax authority commenced an
group is open to audit for the tax years starting in 2014 and in 2019, the German tax authority commenced an
group is open to audit for the tax years starting in 2014 and in 2019, the German tax authority commenced an
group is open to audit for the tax years starting in 2014 and in 2019, the German tax authority commenced an
group is open to audit for the tax years starting in 2014 and in 2019, the German tax authority commenced an
group is open to audit for the tax years starting in 2014 and in 2019, the German tax authority commenced an
audit for the 2014-2016 tax years. The U.S. consolidated group is subject to federal and most state income tax
audit for the 2014-2016 tax years. The U.S. consolidated group is subject to federal and most state income tax
audit for the 2014-2016 tax years. The U.S. consolidated group is subject to federal and most state income tax
audit for the 2014-2016 tax years. The U.S. consolidated group is subject to federal and most state income tax
audit for the 2014-2016 tax years. The U.S. consolidated group is subject to federal and most state income tax
audit for the 2014-2016 tax years. The U.S. consolidated group is subject to federal and most state income tax
examinations by tax authorities beginning with the year ending December 31, 2016 through the current period. Our
examinations by tax authorities beginning with the year ending December 31, 2016 through the current period. Our
examinations by tax authorities beginning with the year ending December 31, 2016 through the current period. Our
examinations by tax authorities beginning with the year ending December 31, 2016 through the current period. Our
examinations by tax authorities beginning with the year ending December 31, 2016 through the current period. Our
examinations by tax authorities beginning with the year ending December 31, 2016 through the current period. Our
other subsidiaries, with few exceptions, are no longer subject to income tax examinations by tax authorities for years
other subsidiaries, with few exceptions, are no longer subject to income tax examinations by tax authorities for years
other subsidiaries, with few exceptions, are no longer subject to income tax examinations by tax authorities for years
other subsidiaries, with few exceptions, are no longer subject to income tax examinations by tax authorities for years
other subsidiaries, with few exceptions, are no longer subject to income tax examinations by tax authorities for years
other subsidiaries, with few exceptions, are no longer subject to income tax examinations by tax authorities for years
before 2015.
before 2015.
before 2015.
before 2015.
before 2015.
before 2015.

Changes in the amount of unrecognized tax benefits for the years ended December 31, 2019, 2018, and 2017 are
Changes in the amount of unrecognized tax benefits for the years ended December 31, 2019, 2018, and 2017 are
Changes in the amount of unrecognized tax benefits for the years ended December 31, 2019, 2018, and 2017 are
as follows:
as follows:
as follows:

Changes in the amount of unrecognized tax benefits for the years ended December 31, 2019, 2018, and 2017 are
Changes in the amount of unrecognized tax benefits for the years ended December 31, 2019, 2018, and 2017 are
Changes in the amount of unrecognized tax benefits for the years ended December 31, 2019, 2018, and 2017 are
as follows:
as follows:
as follows:

193

(in thousands)201920182017AmountPercentAmountPercentAmountPercentTotal income tax (benefit) expense(in thousands)201920182017AmountPercentAmountPercentAmountPercentTotal income tax (benefit) expense(in thousands)201920182017AmountPercentAmountPercentAmountPercentTotal income tax (benefit) expense(in thousands)201920182017AmountPercentAmountPercentAmountPercentTotal income tax (benefit) expense(in thousands)201920182017AmountPercentAmountPercentAmountPercentTotal income tax (benefit) expense(in thousands)201920182017AmountPercentAmountPercentAmountPercentTotal income tax (benefit) expenseBalance at beginning of year
Balance at beginning of year

Additions based on tax positions related to the current year
Additions based on tax positions related to the current year
Balance at beginning of year
Balance at beginning of year

Balance at beginning of year
Balance at beginning of year
Balance at beginning of year

Additions for tax positions of prior years
Additions for tax positions of prior years
Additions based on tax positions related to the current year
Additions based on tax positions related to the current year

Additions based on tax positions related to the current year
Additions based on tax positions related to the current year
Additions based on tax positions related to the current year

Decrease for tax position of prior years
Decrease for tax position of prior years
Additions for tax positions of prior years
Additions for tax positions of prior years

Additions for tax positions of prior years
Additions for tax positions of prior years
Additions for tax positions of prior years

Decrease related to settlements
Decrease related to settlements
Decrease for tax position of prior years
Decrease for tax position of prior years

Decrease for tax position of prior years
Decrease for tax position of prior years
Decrease for tax position of prior years

Decrease due to lapse of statute of limitations
Decrease due to lapse of statute of limitations
Decrease related to settlements
Decrease related to settlements

Decrease related to settlements
Decrease related to settlements
Decrease related to settlements

(Decrease) increase from currency translation
(Decrease) increase from currency translation
Decrease due to lapse of statute of limitations
Decrease due to lapse of statute of limitations

Decrease due to lapse of statute of limitations
Decrease due to lapse of statute of limitations
Decrease due to lapse of statute of limitations

Balance at end of year
Balance at end of year
(Decrease) increase from currency translation
(Decrease) increase from currency translation

(Decrease) increase from currency translation
(Decrease) increase from currency translation
(Decrease) increase from currency translation

$ 55,780
$ 55,780

$ 44,033
$ 44,033

$ 18,294
$ 18,294

5,770
5,770
$ 55,780
$ 55,780
$ 55,780
$ 55,780
$ 55,780

3,359
3,359
$ 44,033
$ 44,033
$ 44,033
$ 44,033
$ 44,033

12,212
12,212
$ 18,294
$ 18,294
$ 18,294
$ 18,294
$ 18,294

14,532
14,532
5,770
5,770

5,770
5,770
5,770

11,984
11,984
3,359
3,359

3,359
3,359
3,359

9,933
9,933
12,212
12,212
12,212
12,212
12,212

(9,073)
(9,073)
14,532
14,532

14,532
14,532
14,532

—
—
11,984
11,984
11,984
11,984
11,984

—
—
9,933
9,933
9,933
9,933
9,933

(7,605)
(7,605)
(9,073)
(9,073)

(9,073)
(9,073)
(9,073)

—
—
—
—

—
—
—

(409)
(409)
(7,605)
(7,605)
(7,605)
(7,605)
(7,605)

(1,238)
(1,238)
—
—

—
—
—

—
—
—
—

—
—
—
—

—
—
—

—
—
—

(993)
(993)
(409)
(409)

(409)
(409)
(409)

(2,358)
(2,358)
(1,238)
(1,238)

(1,238)
(1,238)
(1,238)

3,594
3,594
—
—

—
—
—

$ 58,002
$ 58,002
(993)
(993)

(993)
(993)
(993)

$ 55,780
$ 55,780
(2,358)
(2,358)

(2,358)
(2,358)
(2,358)

$ 44,033
$ 44,033
3,594
3,594

3,594
3,594
3,594

Balance at end of year
Balance at end of year

Balance at end of year
Balance at end of year
Balance at end of year

$ 58,002
$ 58,002

$ 58,002
$ 58,002
$ 58,002

$ 55,780
$ 55,780

$ 55,780
$ 55,780
$ 55,780

$ 44,033
$ 44,033

$ 44,033
$ 44,033
$ 44,033

At December 31, 2019 and 2018, our net unrecognized tax benefits totaled approximately $58.0 million and
At December 31, 2019 and 2018, our net unrecognized tax benefits totaled approximately $58.0 million and
$55.8 million, respectively, which, if recognized, would favorably affect our effective tax rate in any future period. It
$55.8 million, respectively, which, if recognized, would favorably affect our effective tax rate in any future period. It
At December 31, 2019 and 2018, our net unrecognized tax benefits totaled approximately $58.0 million and
At December 31, 2019 and 2018, our net unrecognized tax benefits totaled approximately $58.0 million and
At December 31, 2019 and 2018, our net unrecognized tax benefits totaled approximately $58.0 million and
At December 31, 2019 and 2018, our net unrecognized tax benefits totaled approximately $58.0 million and
At December 31, 2019 and 2018, our net unrecognized tax benefits totaled approximately $58.0 million and
is reasonably possible that approximately $31.4 million of the unrecognized tax benefits may be released or utilized
is reasonably possible that approximately $31.4 million of the unrecognized tax benefits may be released or utilized
$55.8 million, respectively, which, if recognized, would favorably affect our effective tax rate in any future period. It
$55.8 million, respectively, which, if recognized, would favorably affect our effective tax rate in any future period. It
$55.8 million, respectively, which, if recognized, would favorably affect our effective tax rate in any future period. It
$55.8 million, respectively, which, if recognized, would favorably affect our effective tax rate in any future period. It
$55.8 million, respectively, which, if recognized, would favorably affect our effective tax rate in any future period. It
during the next 12 months due to lapse of statute of limitations or settlements with tax authorities; however, various
during the next 12 months due to lapse of statute of limitations or settlements with tax authorities; however, various
is reasonably possible that approximately $31.4 million of the unrecognized tax benefits may be released or utilized
is reasonably possible that approximately $31.4 million of the unrecognized tax benefits may be released or utilized
is reasonably possible that approximately $31.4 million of the unrecognized tax benefits may be released or utilized
is reasonably possible that approximately $31.4 million of the unrecognized tax benefits may be released or utilized
is reasonably possible that approximately $31.4 million of the unrecognized tax benefits may be released or utilized
events could cause our current expectations to change in the future. The above unrecognized tax benefits, if ever
events could cause our current expectations to change in the future. The above unrecognized tax benefits, if ever
during the next 12 months due to lapse of statute of limitations or settlements with tax authorities; however, various
during the next 12 months due to lapse of statute of limitations or settlements with tax authorities; however, various
during the next 12 months due to lapse of statute of limitations or settlements with tax authorities; however, various
during the next 12 months due to lapse of statute of limitations or settlements with tax authorities; however, various
during the next 12 months due to lapse of statute of limitations or settlements with tax authorities; however, various
recognized in the financial statements, would be recorded in the statements of income as part of the income tax
recognized in the financial statements, would be recorded in the statements of income as part of the income tax
events could cause our current expectations to change in the future. The above unrecognized tax benefits, if ever
events could cause our current expectations to change in the future. The above unrecognized tax benefits, if ever
events could cause our current expectations to change in the future. The above unrecognized tax benefits, if ever
events could cause our current expectations to change in the future. The above unrecognized tax benefits, if ever
events could cause our current expectations to change in the future. The above unrecognized tax benefits, if ever
expense.
expense.
recognized in the financial statements, would be recorded in the statements of income as part of the income tax
recognized in the financial statements, would be recorded in the statements of income as part of the income tax
recognized in the financial statements, would be recorded in the statements of income as part of the income tax
recognized in the financial statements, would be recorded in the statements of income as part of the income tax
recognized in the financial statements, would be recorded in the statements of income as part of the income tax
expense.
expense.
expense.
expense.
expense.
Our policy is to recognize interest accrued related to an underpayment of income taxes in interest expense and
Our policy is to recognize interest accrued related to an underpayment of income taxes in interest expense and
penalties within income tax expense. For the years ended December 31, 2019, 2018 and 2017, we recognized a
penalties within income tax expense. For the years ended December 31, 2019, 2018 and 2017, we recognized a
Our policy is to recognize interest accrued related to an underpayment of income taxes in interest expense and
Our policy is to recognize interest accrued related to an underpayment of income taxes in interest expense and
Our policy is to recognize interest accrued related to an underpayment of income taxes in interest expense and
Our policy is to recognize interest accrued related to an underpayment of income taxes in interest expense and
Our policy is to recognize interest accrued related to an underpayment of income taxes in interest expense and
net expense for interest and penalties of $1.6 million, $1.1 million and $1.5 million, respectively. At December 31,
net expense for interest and penalties of $1.6 million, $1.1 million and $1.5 million, respectively. At December 31,
penalties within income tax expense. For the years ended December 31, 2019, 2018 and 2017, we recognized a
penalties within income tax expense. For the years ended December 31, 2019, 2018 and 2017, we recognized a
penalties within income tax expense. For the years ended December 31, 2019, 2018 and 2017, we recognized a
penalties within income tax expense. For the years ended December 31, 2019, 2018 and 2017, we recognized a
penalties within income tax expense. For the years ended December 31, 2019, 2018 and 2017, we recognized a
2019 and 2018, we have accrued interest of $2.5 million and $4.1 million, respectively, which are not included in
2019 and 2018, we have accrued interest of $2.5 million and $4.1 million, respectively, which are not included in
net expense for interest and penalties of $1.6 million, $1.1 million and $1.5 million, respectively. At December 31,
net expense for interest and penalties of $1.6 million, $1.1 million and $1.5 million, respectively. At December 31,
net expense for interest and penalties of $1.6 million, $1.1 million and $1.5 million, respectively. At December 31,
net expense for interest and penalties of $1.6 million, $1.1 million and $1.5 million, respectively. At December 31,
net expense for interest and penalties of $1.6 million, $1.1 million and $1.5 million, respectively. At December 31,
the table above.
the table above.
2019 and 2018, we have accrued interest of $2.5 million and $4.1 million, respectively, which are not included in
2019 and 2018, we have accrued interest of $2.5 million and $4.1 million, respectively, which are not included in
2019 and 2018, we have accrued interest of $2.5 million and $4.1 million, respectively, which are not included in
2019 and 2018, we have accrued interest of $2.5 million and $4.1 million, respectively, which are not included in
2019 and 2018, we have accrued interest of $2.5 million and $4.1 million, respectively, which are not included in
the table above.
the table above.
the table above.
the table above.
the table above.
We have recorded net deferred tax assets of $33.1 million at December 31, 2019 and net deferred tax liabilities of
We have recorded net deferred tax assets of $33.1 million at December 31, 2019 and net deferred tax liabilities of
$20.5 million at December 31, 2018, respectively. The components of the net deferred tax asset and liability at
$20.5 million at December 31, 2018, respectively. The components of the net deferred tax asset and liability at
We have recorded net deferred tax assets of $33.1 million at December 31, 2019 and net deferred tax liabilities of
We have recorded net deferred tax assets of $33.1 million at December 31, 2019 and net deferred tax liabilities of
We have recorded net deferred tax assets of $33.1 million at December 31, 2019 and net deferred tax liabilities of
We have recorded net deferred tax assets of $33.1 million at December 31, 2019 and net deferred tax liabilities of
We have recorded net deferred tax assets of $33.1 million at December 31, 2019 and net deferred tax liabilities of
December 31, 2019 and 2018 are as follows:
December 31, 2019 and 2018 are as follows:
$20.5 million at December 31, 2018, respectively. The components of the net deferred tax asset and liability at
$20.5 million at December 31, 2018, respectively. The components of the net deferred tax asset and liability at
$20.5 million at December 31, 2018, respectively. The components of the net deferred tax asset and liability at
$20.5 million at December 31, 2018, respectively. The components of the net deferred tax asset and liability at
$20.5 million at December 31, 2018, respectively. The components of the net deferred tax asset and liability at
December 31, 2019 and 2018 are as follows:
December 31, 2019 and 2018 are as follows:
December 31, 2019 and 2018 are as follows:
December 31, 2019 and 2018 are as follows:
December 31, 2019 and 2018 are as follows:

Net operating loss and tax credit carryforward
Net operating loss and tax credit carryforward

$ 50,274
$ 50,274

$ —
$ —

$ 27,293
$ 27,293

$  —
$ —

Accrued and other liabilities
Accrued and other liabilities
Net operating loss and tax credit carryforward
Net operating loss and tax credit carryforward

Net operating loss and tax credit carryforward
Net operating loss and tax credit carryforward
Net operating loss and tax credit carryforward

Inventory
Inventory
Accrued and other liabilities
Accrued and other liabilities

Accrued and other liabilities
Accrued and other liabilities
Accrued and other liabilities

Unrealized gain (loss) on investments
Unrealized gain (loss) on investments
Inventory
Inventory

Inventory
Inventory
Inventory

Property, plant and equipment
Property, plant and equipment
Unrealized gain (loss) on investments
Unrealized gain (loss) on investments

Unrealized gain (loss) on investments
Unrealized gain (loss) on investments
Unrealized gain (loss) on investments

Intangible assets
Intangible assets
Property, plant and equipment
Property, plant and equipment

Property, plant and equipment
Property, plant and equipment
Property, plant and equipment

Share-based compensation
Share-based compensation
Intangible assets
Intangible assets
Intangible assets
Intangible assets
Intangible assets

Disallowed interest carryforwards
Disallowed interest carryforwards
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation
Share-based compensation

Convertible notes
Convertible notes
Disallowed interest carryforwards
Disallowed interest carryforwards

Disallowed interest carryforwards
Disallowed interest carryforwards
Disallowed interest carryforwards

Other
Other
Convertible notes
Convertible notes

Convertible notes
Convertible notes
Convertible notes

Other
Other

Other
Other
Other

Valuation allowance
Valuation allowance

Valuation allowance
Valuation allowance

Valuation allowance
Valuation allowance
Valuation allowance

Net deferred tax assets (liabilities)
Net deferred tax assets (liabilities)

17,977
17,977
$ 50,274
$ 50,274
$ 50,274
$ 50,274
$ 50,274

4,726
4,726
17,977
17,977
17,977
17,977
17,977

—
—
4,726
4,726
4,726
4,726
4,726

5,297
5,297
—
—

—
—
—

1,078
1,078
5,297
5,297

5,297
5,297
5,297

13,787
13,787
1,078
1,078

1,078
1,078
1,078

73,690
73,690
13,787
13,787

13,787
13,787
13,787

7,104
7,104
73,690
73,690
73,690
73,690
73,690

5,998
5,998
7,104
7,104

7,104
7,104
7,104

179,931
179,931
5,998
5,998

5,998
5,998
5,998

(87,619)
(87,619)
179,931
179,931

179,931
179,931
179,931

—
—
$ —
$ —
$ —
$ —
$ —

(1,439)
(1,439)
—
—

—
—
—

(4,973)
(4,973)
(1,439)
(1,439)

(1,439)
(1,439)
(1,439)

(20,332)
(20,332)
(4,973)
(4,973)

(4,973)
(4,973)
(4,973)

(26,294)
(26,294)
(20,332)
(20,332)

(20,332)
(20,332)
(20,332)

—
—
(26,294)
(26,294)
(26,294)
(26,294)
(26,294)

—
—
—
—

—
—
—
—

—
—
—

—
—
—

(6,174)
(6,174)
—
—

—
—
—

(59,212)
(59,212)
(6,174)
(6,174)

(6,174)
(6,174)
(6,174)

—
—
(59,212)
(59,212)
(59,212)
(59,212)
(59,212)

15,480
15,480
$ 27,293
$ 27,293
$ 27,293
$ 27,293
$ 27,293

3,978
3,978
15,480
15,480
15,480
15,480
15,480

3,280
3,280
3,978
3,978

3,978
3,978
3,978

3,604
3,604
3,280
3,280

3,280
3,280
3,280

1,721
1,721
3,604
3,604

3,604
3,604
3,604

17,998
17,998
1,721
1,721

1,721
1,721
1,721

60,458
60,458
17,998
17,998

17,998
17,998
17,998

8,102
8,102
60,458
60,458
60,458
60,458
60,458

5,854
5,854
8,102
8,102

8,102
8,102
8,102

147,768
147,768
5,854
5,854

5,854
5,854
5,854

(68,651)
(68,651)
147,768
147,768

147,768
147,768
147,768

—
—
$  —
$ —
$ —
$ —
$ —

(1,725)
(1,725)
—
—

—
—
—

(4,855)
(4,855)
(1,725)
(1,725)

(1,725)
(1,725)
(1,725)

(25,448)
(25,448)
(4,855)
(4,855)

(4,855)
(4,855)
(4,855)

(63,990)
(63,990)
(25,448)
(25,448)

(25,448)
(25,448)
(25,448)

—
—
(63,990)
(63,990)
(63,990)
(63,990)
(63,990)

—
—
—
—

—
—
—
—

—
—
—

—
—
—

(3,614)
(3,614)
—
—

—
—
—

(99,632)
(99,632)
(3,614)
(3,614)

(3,614)
(3,614)
(3,614)

—
—
(99,632)
(99,632)
(99,632)
(99,632)
(99,632)

$ 92,312
$ 92,312
(87,619)
(87,619)

(87,619)
(87,619)
(87,619)

$ (59,212)
$ (59,212)
—
—

—
—
—

$  79,117
$ 79,117
(68,651)
(68,651)

(68,651)
(68,651)
(68,651)

$  (99,632)
$ (99,632)
—
—

—
—
—

$ 92,312
$ 92,312

$ 92,312
$ 92,312
$ 92,312

$ 33,100
$ 33,100
$ (59,212)
$ (59,212)
$ (59,212)
$ (59,212)
$ (59,212)

$  79,117
$ 79,117

$ 79,117
$ 79,117
$ 79,117

$ (20,515)
$ (20,515)
$  (99,632)
$ (99,632)

$ (99,632)
$ (99,632)
$ (99,632)

Net deferred tax assets (liabilities)
Net deferred tax assets (liabilities)

Net deferred tax assets (liabilities)
Net deferred tax assets (liabilities)
Net deferred tax assets (liabilities)

$ 33,100
$ 33,100

$ 33,100
$ 33,100
$ 33,100

$ (20,515)
$ (20,515)

$ (20,515)
$ (20,515)
$ (20,515)

194

(in thousands)201920182017(in thousands)20192018Deferred Tax AssetDeferred TaxLiabilityDeferred Tax AssetDeferred TaxLiability(in thousands)201920182017(in thousands)20192018Deferred Tax AssetDeferred TaxLiabilityDeferred Tax AssetDeferred TaxLiability(in thousands)201920182017(in thousands)20192018Deferred Tax AssetDeferred TaxLiabilityDeferred Tax AssetDeferred TaxLiability(in thousands)201920182017(in thousands)20192018Deferred Tax AssetDeferred TaxLiabilityDeferred Tax AssetDeferred TaxLiability(in thousands)201920182017(in thousands)20192018Deferred Tax AssetDeferred TaxLiabilityDeferred Tax AssetDeferred TaxLiability(in thousands)201920182017(in thousands)20192018Deferred Tax AssetDeferred TaxLiabilityDeferred Tax AssetDeferred TaxLiability(in thousands)201920182017(in thousands)20192018Deferred Tax AssetDeferred TaxLiabilityDeferred Tax AssetDeferred TaxLiabilityF I N A N C I A L   R E S U LT S Notes to consolidated financial statements

At December 31, 2019, we had $682.5 million in total net operating loss (NOL) carryforwards which included
$394.0 million for Germany, $133.8 million for the U.S., $52.4 million for The Netherlands and $102.3 million for
other foreign jurisdictions. Of the total $394.0 million NOL in Germany, there is no expiration and expect to be fully
utilized in future years. The entire NOL in the U.S. is subject to limitations under Section 382 of the U.S. Internal
Revenue Code. The NOLs in the U.S. will expire between 2024 through 2034. At December 31, 2019, we have
$52.4 million of Netherlands net operating loss carryforwards before valuation allowance, which will expire in the
year 2027. Of the total $102.3 million foreign NOL carryforwards, $25.4 million will expire between 2020 and
2028 while the rest of the NOLs can be carried forward indefinitely. At December 31, 2019, we had $280.0
million of disallowed interest carryforwards which can be carried forward indefinitely. At December 31, 2019, tax
credits total $1.3 million which expire between 2030 and 2039.

For the years ended December 31, 2019, 2018 and 2017, the changes in the valuation allowance charged to
income tax expense totaled $19.0 million, $0.8 million and $62.3 million, respectively. The valuation allowance
relates to disallowed interest carryforwards and net operating loss carryforwards. The Company can only recognize
a deferred tax asset to the extent it is "more likely than not" that these assets will be realized. Judgments around
realizability depend on the availability and weight of both positive and negative evidence.

As of December 31, 2019, a deferred tax liability has not been recognized for residual income taxes in The
Netherlands on the undistributed earnings of the majority of our foreign subsidiaries as these earnings are
considered to be either indefinitely reinvested or can be repatriated tax free under the Dutch participation exemption.
The indefinitely reinvested earnings retained of our subsidiaries that would be subject to tax if distributed amounted
to $699.0 million at December 31, 2019. Estimating the amount of the unrecognized deferred tax liability on
indefinitely reinvested foreign earnings is not practicable. Should the earnings be remitted as dividends, we may be
subject to taxes including withholding tax. We have $26.4 million of undistributed earnings that we do not consider
indefinitely reinvested and have recorded a deferred tax liability at December 31, 2019 and December 31, 2018,
of $1.5 million and $0.9 million, respectively.

18. Equity

The authorized classes of our shares consist of Common Shares (410 million authorized), Preference Shares (450
million authorized) and Financing Preference Shares (40 million authorized). All classes of shares have a par value
of €0.01. No Financing Preference Shares or Preference Shares have been issued. Like all shareholders' equity
accounts, common shares are translated to U.S. dollars at the foreign exchange rates in effect when the shares are
issued.

In connection with the issuance of the Cash Convertible Notes as described in Note 16 "Lines of Credit and Debt",
we issued Warrants as summarized in the table below. The number of warrants and exercise prices are subject to
customary adjustments under certain circumstances. The proceeds, net of issuance costs, from the sale of the
Warrants are included as additional paid in capital in the accompanying consolidated balance sheets.

2019

2021

2023

2024

March 19, 2014

March 19, 2014

September 13, 2017

November 13, 2018

15.2

10.6

9.7

10.9

$32.0560

$32.0560

$50.9664

$52.1639

$40.6

$28.3

$45.3

$72.4

December 27, 2018

December 29, 2020

June 26, 2023

August 27, 2024

The Warrants are exercisable only upon expiration. For each Warrant that is exercised, we will deliver to the holder
a number of shares of our common stock equal to the amount by which the settlement price exceeds the exercise
price, divided by the settlement price, plus cash in lieu of any fractional shares. The Warrants could separately have

195

SharesIssuance and Conversion of WarrantsCash convertible notesIssued onNumber of sharewarrants(in millions)Exercise price pershareProceeds from issuanceof warrants, net ofissuance costs (in millions)Warrants expire over aperiod of 50 tradingdays beginning onAt December 31, 2019, we had $682.5 million in total net operating loss (NOL) carryforwards which included

$394.0 million for Germany, $133.8 million for the U.S., $52.4 million for The Netherlands and $102.3 million for

other foreign jurisdictions. Of the total $394.0 million NOL in Germany, there is no expiration and expect to be fully

utilized in future years. The entire NOL in the U.S. is subject to limitations under Section 382 of the U.S. Internal

Revenue Code. The NOLs in the U.S. will expire between 2024 through 2034. At December 31, 2019, we have

$52.4 million of Netherlands net operating loss carryforwards before valuation allowance, which will expire in the

year 2027. Of the total $102.3 million foreign NOL carryforwards, $25.4 million will expire between 2020 and

2028 while the rest of the NOLs can be carried forward indefinitely. At December 31, 2019, we had $280.0

million of disallowed interest carryforwards which can be carried forward indefinitely. At December 31, 2019, tax

credits total $1.3 million which expire between 2030 and 2039.

For the years ended December 31, 2019, 2018 and 2017, the changes in the valuation allowance charged to

income tax expense totaled $19.0 million, $0.8 million and $62.3 million, respectively. The valuation allowance

relates to disallowed interest carryforwards and net operating loss carryforwards. The Company can only recognize

a deferred tax asset to the extent it is "more likely than not" that these assets will be realized. Judgments around

realizability depend on the availability and weight of both positive and negative evidence.

As of December 31, 2019, a deferred tax liability has not been recognized for residual income taxes in The

Netherlands on the undistributed earnings of the majority of our foreign subsidiaries as these earnings are

considered to be either indefinitely reinvested or can be repatriated tax free under the Dutch participation exemption.

The indefinitely reinvested earnings retained of our subsidiaries that would be subject to tax if distributed amounted

to $699.0 million at December 31, 2019. Estimating the amount of the unrecognized deferred tax liability on

indefinitely reinvested foreign earnings is not practicable. Should the earnings be remitted as dividends, we may be

subject to taxes including withholding tax. We have $26.4 million of undistributed earnings that we do not consider

indefinitely reinvested and have recorded a deferred tax liability at December 31, 2019 and December 31, 2018,

of $1.5 million and $0.9 million, respectively.

18. Equity

The authorized classes of our shares consist of Common Shares (410 million authorized), Preference Shares (450

million authorized) and Financing Preference Shares (40 million authorized). All classes of shares have a par value

of €0.01. No Financing Preference Shares or Preference Shares have been issued. Like all shareholders' equity

accounts, common shares are translated to U.S. dollars at the foreign exchange rates in effect when the shares are

issued.

In connection with the issuance of the Cash Convertible Notes as described in Note 16 "Lines of Credit and Debt",
we issued Warrants as summarized in the table below. The number of warrants and exercise prices are subject to
customary adjustments under certain circumstances. The proceeds, net of issuance costs, from the sale of the
Warrants are included as additional paid in capital in the accompanying consolidated balance sheets.

2019

2021

2023

2024

March 19, 2014

March 19, 2014

September 13, 2017

November 13, 2018

15.2

10.6

9.7

10.9

$32.0560

$32.0560

$50.9664

$52.1639

$40.6

$28.3

$45.3

$72.4

December 27, 2018

December 29, 2020

June 26, 2023

August 27, 2024

The Warrants are exercisable only upon expiration. For each Warrant that is exercised, we will deliver to the holder
a number of shares of our common stock equal to the amount by which the settlement price exceeds the exercise
price, divided by the settlement price, plus cash in lieu of any fractional shares. The Warrants could separately have
a dilutive effect on shares of our common stock to the extent that the market value per share of our common stock
exceeds the applicable exercise price of the Warrants (as measured under the terms of the Warrants).

During 2019, 2.1 million common shares were issued in connection with the conversion of the 15.2 million warrants
related to the 2019 Notes which resulted in a $31.1 million decrease to additional paid in capital, a $37.7 million
decrease in retained earnings, a decrease of 68.8 million in treasury shares and an approximately $4 thousand
cash payment for fractional shares.

On May 6, 2019, we announced our sixth share repurchase program of up to $100 million of our common shares.
During 2019, no shares were repurchased under this program.

On January 31, 2018, we announced our fifth share repurchase program of up to $200 million of our common
shares. During 2018, we repurchased 2.9 million QIAGEN shares for $104.7 million (including transaction costs).
During 2019, we repurchased 2.0 million QIAGEN shares for $74.5 million (including transaction costs), bringing
the total shares repurchased under this program to 4.9 million for $179.1 million (including transaction costs).

On April 27, 2016, we announced the launch of our fourth $100 million share repurchase program. During 2017,
1.9 million QIAGEN shares were repurchased for $61.0 million (including transaction costs).

The cost of repurchased shares is included in treasury stock and reported as a reduction in total equity when a
repurchase occurs. Repurchased shares will be held in treasury in order to satisfy various obligations, which include
exchangeable debt instruments, warrants and employee share-based remuneration plans.

In August 2016, we announced our plan to return approximately $250.0 million to shareholders through a synthetic
share repurchase program that combines a direct capital repayment with a reverse stock split. The synthetic share
repurchase was implemented through a series of amendments to our Articles of Association which were approved by
our shareholders at an Extraordinary General Meeting (EGM) held on October 26, 2016. The first amendment
involved an increase in share capital by an increase in the nominal value per common share from EUR 0.01 to EUR
1.04 and a corresponding reduction in additional paid in capital. The second amendment involved a reduction in
stock whereby 27 existing common shares with a nominal value of EUR 1.04 each were consolidated into 26 new
common shares with a nominal value of EUR 1.08 each. The third amendment was a reduction of the nominal value
per common share from EUR 1.08 to EUR 0.01. As a result of these amendments, which in substance constitute a
synthetic share buyback, $243.9 million was repaid to our shareholders and the outstanding number of common
shares was reduced by 8.9 million, or 3.7%. The capital repayment program was completed in January 2017.
Expenses incurred related to the capital repayment and share consolidation amounted to $0.5 million and were
charged to equity.

196
The following table is a summary of the components of accumulated other comprehensive loss as of December 31,
2019 and 2018:

Foreign currency effects from intercompany long-term investment transactions, net of tax of $9.7 million and

(22,587)

(21,662)

Net unrealized loss on hedging contracts, net of tax

Net unrealized loss on pension, net of tax

$9.3 million in 2019 and 2018, respectively

Foreign currency translation adjustments

Accumulated other comprehensive loss

$ (2,289)

$ (15,453)

(561)

(124)

(284,182)

(273,405)

$ (309,619)

$ (310,644)

SharesIssuance and Conversion of WarrantsCash convertible notesIssued onNumber of sharewarrants(in millions)Exercise price pershareProceeds from issuanceof warrants, net ofissuance costs (in millions)Warrants expire over aperiod of 50 tradingdays beginning onShare Repurchase ProgramsSynthetic Share RepurchaseAccumulated Other Comprehensive Loss(in thousands)20192018a dilutive effect on shares of our common stock to the extent that the market value per share of our common stock

a dilutive effect on shares of our common stock to the extent that the market value per share of our common stock

exceeds the applicable exercise price of the Warrants (as measured under the terms of the Warrants).

exceeds the applicable exercise price of the Warrants (as measured under the terms of the Warrants).

During 2019, 2.1 million common shares were issued in connection with the conversion of the 15.2 million warrants

During 2019, 2.1 million common shares were issued in connection with the conversion of the 15.2 million warrants

related to the 2019 Notes which resulted in a $31.1 million decrease to additional paid in capital, a $37.7 million

related to the 2019 Notes which resulted in a $31.1 million decrease to additional paid in capital, a $37.7 million

decrease in retained earnings, a decrease of 68.8 million in treasury shares and an approximately $4 thousand

decrease in retained earnings, a decrease of 68.8 million in treasury shares and an approximately $4 thousand

cash payment for fractional shares.

cash payment for fractional shares.

On May 6, 2019, we announced our sixth share repurchase program of up to $100 million of our common shares.

On May 6, 2019, we announced our sixth share repurchase program of up to $100 million of our common shares.

During 2019, no shares were repurchased under this program.

During 2019, no shares were repurchased under this program.

On January 31, 2018, we announced our fifth share repurchase program of up to $200 million of our common

On January 31, 2018, we announced our fifth share repurchase program of up to $200 million of our common

shares. During 2018, we repurchased 2.9 million QIAGEN shares for $104.7 million (including transaction costs).

shares. During 2018, we repurchased 2.9 million QIAGEN shares for $104.7 million (including transaction costs).

During 2019, we repurchased 2.0 million QIAGEN shares for $74.5 million (including transaction costs), bringing

During 2019, we repurchased 2.0 million QIAGEN shares for $74.5 million (including transaction costs), bringing

the total shares repurchased under this program to 4.9 million for $179.1 million (including transaction costs).

the total shares repurchased under this program to 4.9 million for $179.1 million (including transaction costs).

Balance at beginning of year

Balance at beginning of year

$ 55,780

$ 55,780

$ 44,033

$ 44,033

$ 18,294

$ 18,294

Additions based on tax positions related to the current year

On April 27, 2016, we announced the launch of our fourth $100 million share repurchase program. During 2017,

On April 27, 2016, we announced the launch of our fourth $100 million share repurchase program. During 2017,

Additions based on tax positions related to the current year

5,770

5,770

3,359

3,359

12,212

12,212

Additions for tax positions of prior years

Additions for tax positions of prior years

1.9 million QIAGEN shares were repurchased for $61.0 million (including transaction costs).

1.9 million QIAGEN shares were repurchased for $61.0 million (including transaction costs).

14,532

14,532

11,984

11,984

9,933

9,933

Decrease for tax position of prior years

Decrease for tax position of prior years

(9,073)

(9,073)

The cost of repurchased shares is included in treasury stock and reported as a reduction in total equity when a

The cost of repurchased shares is included in treasury stock and reported as a reduction in total equity when a

Decrease related to settlements

repurchase occurs. Repurchased shares will be held in treasury in order to satisfy various obligations, which include

repurchase occurs. Repurchased shares will be held in treasury in order to satisfy various obligations, which include

Decrease related to settlements

(7,605)

(7,605)

Decrease due to lapse of statute of limitations

exchangeable debt instruments, warrants and employee share-based remuneration plans.

exchangeable debt instruments, warrants and employee share-based remuneration plans.

Decrease due to lapse of statute of limitations

(409)

(409)

(1,238)

(1,238)

—

—

—

—

—

—

—

—

—

—

(Decrease) increase from currency translation

(Decrease) increase from currency translation

(993)

(993)

(2,358)

(2,358)

3,594

3,594

Balance at end of year

Balance at end of year

$ 58,002

$ 58,002

$ 55,780

$ 55,780

$ 44,033

$ 44,033

At December 31, 2019 and 2018, our net unrecognized tax benefits totaled approximately $58.0 million and

At December 31, 2019 and 2018, our net unrecognized tax benefits totaled approximately $58.0 million and

In August 2016, we announced our plan to return approximately $250.0 million to shareholders through a synthetic

In August 2016, we announced our plan to return approximately $250.0 million to shareholders through a synthetic

share repurchase program that combines a direct capital repayment with a reverse stock split. The synthetic share

share repurchase program that combines a direct capital repayment with a reverse stock split. The synthetic share

$55.8 million, respectively, which, if recognized, would favorably affect our effective tax rate in any future period. It

$55.8 million, respectively, which, if recognized, would favorably affect our effective tax rate in any future period. It

repurchase was implemented through a series of amendments to our Articles of Association which were approved by

repurchase was implemented through a series of amendments to our Articles of Association which were approved by

is reasonably possible that approximately $31.4 million of the unrecognized tax benefits may be released or utilized

is reasonably possible that approximately $31.4 million of the unrecognized tax benefits may be released or utilized

during the next 12 months due to lapse of statute of limitations or settlements with tax authorities; however, various

during the next 12 months due to lapse of statute of limitations or settlements with tax authorities; however, various

events could cause our current expectations to change in the future. The above unrecognized tax benefits, if ever

events could cause our current expectations to change in the future. The above unrecognized tax benefits, if ever

involved an increase in share capital by an increase in the nominal value per common share from EUR 0.01 to EUR

involved an increase in share capital by an increase in the nominal value per common share from EUR 0.01 to EUR

our shareholders at an Extraordinary General Meeting (EGM) held on October 26, 2016. The first amendment

our shareholders at an Extraordinary General Meeting (EGM) held on October 26, 2016. The first amendment

recognized in the financial statements, would be recorded in the statements of income as part of the income tax
expense.

1.04 and a corresponding reduction in additional paid in capital. The second amendment involved a reduction in
stock whereby 27 existing common shares with a nominal value of EUR 1.04 each were consolidated into 26 new
common shares with a nominal value of EUR 1.08 each. The third amendment was a reduction of the nominal value
per common share from EUR 1.08 to EUR 0.01. As a result of these amendments, which in substance constitute a
Our policy is to recognize interest accrued related to an underpayment of income taxes in interest expense and
synthetic share buyback, $243.9 million was repaid to our shareholders and the outstanding number of common
penalties within income tax expense. For the years ended December 31, 2019, 2018 and 2017, we recognized a
shares was reduced by 8.9 million, or 3.7%. The capital repayment program was completed in January 2017.
net expense for interest and penalties of $1.6 million, $1.1 million and $1.5 million, respectively. At December 31,
Expenses incurred related to the capital repayment and share consolidation amounted to $0.5 million and were
2019 and 2018, we have accrued interest of $2.5 million and $4.1 million, respectively, which are not included in
charged to equity.
the table above.

1.04 and a corresponding reduction in additional paid in capital. The second amendment involved a reduction in
stock whereby 27 existing common shares with a nominal value of EUR 1.04 each were consolidated into 26 new
common shares with a nominal value of EUR 1.08 each. The third amendment was a reduction of the nominal value
F I N A N C I A L   R E S U LT S Notes to consolidated financial statements
per common share from EUR 1.08 to EUR 0.01. As a result of these amendments, which in substance constitute a
synthetic share buyback, $243.9 million was repaid to our shareholders and the outstanding number of common
shares was reduced by 8.9 million, or 3.7%. The capital repayment program was completed in January 2017.
Expenses incurred related to the capital repayment and share consolidation amounted to $0.5 million and were
charged to equity.

Our policy is to recognize interest accrued related to an underpayment of income taxes in interest expense and
penalties within income tax expense. For the years ended December 31, 2019, 2018 and 2017, we recognized a
net expense for interest and penalties of $1.6 million, $1.1 million and $1.5 million, respectively. At December 31,
2019 and 2018, we have accrued interest of $2.5 million and $4.1 million, respectively, which are not included in
the table above.

recognized in the financial statements, would be recorded in the statements of income as part of the income tax
expense.

We have recorded net deferred tax assets of $33.1 million at December 31, 2019 and net deferred tax liabilities of
The following table is a summary of the components of accumulated other comprehensive loss as of December 31,
The following table is a summary of the components of accumulated other comprehensive loss as of December 31,
$20.5 million at December 31, 2018, respectively. The components of the net deferred tax asset and liability at
2019 and 2018:
2019 and 2018:
December 31, 2019 and 2018 are as follows:

We have recorded net deferred tax assets of $33.1 million at December 31, 2019 and net deferred tax liabilities of
$20.5 million at December 31, 2018, respectively. The components of the net deferred tax asset and liability at
December 31, 2019 and 2018 are as follows:

Net unrealized loss on hedging contracts, net of tax

Net unrealized loss on hedging contracts, net of tax

Net unrealized loss on pension, net of tax

Net unrealized loss on pension, net of tax

$ (2,289)

$ (2,289)

$ (15,453)

$ (15,453)

(561)

(561)

(124)

(124)

$ —

$ —

(1,725)

(1,725)

(4,855)

(4,855)

—

—

—

—

—

—

(3,614)

(3,614)

(99,632)

(99,632)

Net operating loss and tax credit carryforward

Foreign currency effects from intercompany long-term investment transactions, net of tax of $9.7 million and
$9.3 million in 2019 and 2018, respectively

Foreign currency effects from intercompany long-term investment transactions, net of tax of $9.7 million and
$9.3 million in 2019 and 2018, respectively

Net operating loss and tax credit carryforward

$ 50,274

Accrued and other liabilities

Accrued and other liabilities

17,977

Inventory

Foreign currency translation adjustments

Foreign currency translation adjustments
Inventory

Unrealized gain (loss) on investments

Unrealized gain (loss) on investments

Accumulated other comprehensive loss

Accumulated other comprehensive loss

Property, plant and equipment

Property, plant and equipment

Intangible assets

19. Earnings per Common Share
19. Earnings per Common Share

19. Earnings per Common Share
19. Earnings per Common Share

Intangible assets

4,726

—

5,297

1,078

$ 50,274

(22,587)

$ —
(22,587)

$ —
(21,662)

$ 27,293
$ 27,293

(21,662)

17,977

—

—

15,480
15,480

—

—

(284,182)
4,726

(1,439)

(284,182)

$ (309,619)
—
(4,973)

$ (309,619)

(273,405)

(273,405)

(1,439)

3,978
3,978

$ (310,644)
(4,973)

$ (310,644)

3,280
3,280

5,297

(20,332)

(20,332)

3,604
3,604

(25,448)

(25,448)

1,078

(26,294)

(26,294)

1,721
1,721

(63,990)

(63,990)

Share-based compensation

Share-based compensation

13,787

13,787

—

—

17,998
17,998

Disallowed interest carryforwards

Convertible notes

Other

Disallowed interest carryforwards

We present basic and diluted earnings per share. Basic earnings per share is calculated by dividing the net (loss)
We present basic and diluted earnings per share. Basic earnings per share is calculated by dividing the net (loss)
We present basic and diluted earnings per share. Basic earnings per share is calculated by dividing the net (loss)
We present basic and diluted earnings per share. Basic earnings per share is calculated by dividing the net (loss)
income by the weighted average number of common shares outstanding. Diluted earnings per share reflect the
income by the weighted average number of common shares outstanding. Diluted earnings per share reflect the
income by the weighted average number of common shares outstanding. Diluted earnings per share reflect the
income by the weighted average number of common shares outstanding. Diluted earnings per share reflect the
potential dilution that would occur if all “in the money” securities to issue common shares were exercised. Due to the
potential dilution that would occur if all “in the money” securities to issue common shares were exercised. Due to the
potential dilution that would occur if all “in the money” securities to issue common shares were exercised. Due to the
potential dilution that would occur if all “in the money” securities to issue common shares were exercised. Due to the
net loss for the year ended December 31, 2019, stock options and restricted stock units representing approximately
net loss for the year ended December 31, 2019, stock options and restricted stock units representing approximately
net loss for the year ended December 31, 2019, stock options and restricted stock units representing approximately
net loss for the year ended December 31, 2019, stock options and restricted stock units representing approximately
3.9 million weighted-average shares of common stock and warrants representing 1.7 million shares of common stock
3.9 million weighted-average shares of common stock and warrants representing 1.7 million shares of common stock
3.9 million weighted-average shares of common stock and warrants representing 1.7 million shares of common stock
3.9 million weighted-average shares of common stock and warrants representing 1.7 million shares of common stock
were excluded from the computation of diluted net loss because the impact would have been antidilutive.
were excluded from the computation of diluted net loss because the impact would have been antidilutive.
were excluded from the computation of diluted net loss because the impact would have been antidilutive.
were excluded from the computation of diluted net loss because the impact would have been antidilutive.

Convertible notes

179,931

(59,212)

73,690

(6,174)

7,104

5,998

179,931

(59,212)

73,690

(6,174)

7,104

5,998

Other

—

—

—

—

60,458
60,458

8,102
8,102

5,854
5,854

147,768
147,768

Valuation allowance

Valuation allowance

(87,619)

(87,619)

—

—

(68,651)
(68,651)

—

—

The following schedule summarizes the information used to compute earnings per common share:
The following schedule summarizes the information used to compute earnings per common share:

$ (59,212)
The following schedule summarizes the information used to compute earnings per common share:
The following schedule summarizes the information used to compute earnings per common share:

$ 92,312

$ 92,312

$ (59,212)

$ 79,117
$ 79,117

$ (99,632)

$ (99,632)

Net deferred tax assets (liabilities)

Net deferred tax assets (liabilities)

$ 33,100

$ 33,100

$ (20,515)

$ (20,515)

Net (loss) income
Net (loss) income

Net (loss) income
Net (loss) income

$ (41,455)
$ (41,455)

$ (41,455)
$ (41,455)

$ 190,380
$ 190,380

$ 190,380
$ 190,380

$ 40,394
$ 40,394

$ 40,394
$ 40,394

Weighted average number of common shares used to compute basic net income per
Weighted average number of common shares used to compute basic net income per
common share
common share

Weighted average number of common shares used to compute basic net income per
Weighted average number of common shares used to compute basic net income per
common share
common share

226,777
226,777

226,777
226,777

226,640
226,640

226,640
226,640

228,074
228,074

228,074
228,074

Dilutive effect of stock options and restrictive stock units
Dilutive effect of stock options and restrictive stock units

Dilutive effect of stock options and restrictive stock units
Dilutive effect of stock options and restrictive stock units

Dilutive effect of outstanding warrants
Dilutive effect of outstanding warrants

Dilutive effect of outstanding warrants
Dilutive effect of outstanding warrants

—
—

—
—

—
—

—
—

4,613
4,613

4,613
4,613

4,760
4,760

4,760
4,760

2,203
2,203

2,203
2,203

175
175

175
175

Weighted average number of common shares used to compute diluted net income per
Weighted average number of common shares used to compute diluted net income per
common share
common share

Weighted average number of common shares used to compute diluted net income per
Weighted average number of common shares used to compute diluted net income per
common share
common share

226,777
226,777

226,777
226,777

233,456
233,456

233,456
233,456

233,009
233,009

233,009
233,009

Outstanding options and awards having no dilutive effect, not included in above
Outstanding options and awards having no dilutive effect, not included in above
calculation
calculation

Outstanding options and awards having no dilutive effect, not included in above
Outstanding options and awards having no dilutive effect, not included in above
calculation
calculation

107
107

107
107

272
272

272
272

52
52

52
52

Outstanding warrants having no dilutive effect, not included in above calculation
Outstanding warrants having no dilutive effect, not included in above calculation

Outstanding warrants having no dilutive effect, not included in above calculation
Outstanding warrants having no dilutive effect, not included in above calculation

32,938
32,938

32,938
32,938

35,939
35,939

35,939
35,939

30,434
30,434

30,434
30,434

Basic (loss) earnings per common share
Basic (loss) earnings per common share

Basic (loss) earnings per common share
Basic (loss) earnings per common share

$ (0.18)
$ (0.18 )

$ (0.18 )
$ (0.18 )

$ 0.84
$ 0.84

$ 0.84
$ 0.84

$ 0.18
$ 0.18

$ 0.18
$ 0.18

Diluted (loss) earnings per common share
Diluted (loss) earnings per common share

Diluted (loss) earnings per common share
Diluted (loss) earnings per common share

$ (0.18)
$ (0.18 )

$ (0.18 )
$ (0.18 )

$ 0.82
$ 0.82

$ 0.82
$ 0.82

$ 0.17
$ 0.17

$ 0.17
$ 0.17

20. Commitments and Contingencies
20. Commitments and Contingencies

20. Commitments and Contingencies
20. Commitments and Contingencies

We have licensing agreements with companies, universities and individuals, some of which require certain up-front
We have licensing agreements with companies, universities and individuals, some of which require certain up-front
We have licensing agreements with companies, universities and individuals, some of which require certain up-front
We have licensing agreements with companies, universities and individuals, some of which require certain up-front
payments. Royalty payments are required on net product sales ranging from 0.45 percent to 25 percent of covered
payments. Royalty payments are required on net product sales ranging from 0.45 percent to 25 percent of covered
payments. Royalty payments are required on net product sales ranging from 0.45 percent to 25 percent of covered
payments. Royalty payments are required on net product sales ranging from 0.45 percent to 25 percent of covered
products or based on quantities sold. Several of these agreements have minimum royalty requirements. The
products or based on quantities sold. Several of these agreements have minimum royalty requirements. The
products or based on quantities sold. Several of these agreements have minimum royalty requirements. The
products or based on quantities sold. Several of these agreements have minimum royalty requirements. The

197

accompanying consolidated balance sheets include accrued royalties relating to these agreements in the amount of

accompanying consolidated balance sheets include accrued royalties relating to these agreements in the amount of

accompanying consolidated balance sheets include accrued royalties relating to these agreements in the amount of

accompanying consolidated balance sheets include accrued royalties relating to these agreements in the amount of

$5.5 million at December 31, 2019 and 2018. Royalty expense relating to these agreements amounted to $13.5

$5.5 million at December 31, 2019 and 2018. Royalty expense relating to these agreements amounted to $13.5

$5.5 million at December 31, 2019 and 2018. Royalty expense relating to these agreements amounted to $13.5

$5.5 million at December 31, 2019 and 2018. Royalty expense relating to these agreements amounted to $13.5

million, $14.0 million, and $16.8 million for the years ended December 31, 2019, 2018 and 2017, respectively.

million, $14.0 million, and $16.8 million for the years ended December 31, 2019, 2018 and 2017, respectively.

million, $14.0 million, and $16.8 million for the years ended December 31, 2019, 2018 and 2017, respectively.

million, $14.0 million, and $16.8 million for the years ended December 31, 2019, 2018 and 2017, respectively.

Royalty expense is primarily recorded in cost of sales, with a small portion recorded as research and development

Royalty expense is primarily recorded in cost of sales, with a small portion recorded as research and development

Royalty expense is primarily recorded in cost of sales, with a small portion recorded as research and development

Royalty expense is primarily recorded in cost of sales, with a small portion recorded as research and development

expense depending on the use of the technology under license. Some of these agreements also have minimum raw

expense depending on the use of the technology under license. Some of these agreements also have minimum raw

expense depending on the use of the technology under license. Some of these agreements also have minimum raw

expense depending on the use of the technology under license. Some of these agreements also have minimum raw

material purchase requirements and requirements to perform specific types of research.

material purchase requirements and requirements to perform specific types of research.

material purchase requirements and requirements to perform specific types of research.

material purchase requirements and requirements to perform specific types of research.

At December 31, 2019, we had commitments to purchase goods or services, and for future license and royalty

At December 31, 2019, we had commitments to purchase goods or services, and for future license and royalty

At December 31, 2019, we had commitments to purchase goods or services, and for future license and royalty

At December 31, 2019, we had commitments to purchase goods or services, and for future license and royalty

payments. They are as follows:

payments. They are as follows:

payments. They are as follows:

payments. They are as follows:

Licensing and Purchase Commitments(in thousands, except per share data)Years ended December 31,201920182017Share Repurchase ProgramsSynthetic Share RepurchaseAccumulated Other Comprehensive Loss(in thousands)20192018(in thousands)201920182017(in thousands)20192018Deferred Tax AssetDeferred TaxLiabilityDeferred Tax AssetDeferred TaxLiability(in thousands)201920182017(in thousands)20192018Deferred Tax AssetDeferred TaxLiabilityDeferred Tax AssetDeferred TaxLiabilityShare Repurchase ProgramsSynthetic Share RepurchaseAccumulated Other Comprehensive Loss(in thousands)20192018Licensing and Purchase Commitments(in thousands, except per share data)Years ended December 31,201920182017Licensing and Purchase Commitments(in thousands, except per share data)Years ended December 31,201920182017Licensing and Purchase Commitments(in thousands, except per share data)Years ended December 31,201920182017 
 
 
 
 
 
 
 
19. Earnings per Common Share

We present basic and diluted earnings per share. Basic earnings per share is calculated by dividing the net (loss)

income by the weighted average number of common shares outstanding. Diluted earnings per share reflect the

potential dilution that would occur if all “in the money” securities to issue common shares were exercised. Due to the

net loss for the year ended December 31, 2019, stock options and restricted stock units representing approximately

3.9 million weighted-average shares of common stock and warrants representing 1.7 million shares of common stock

were excluded from the computation of diluted net loss because the impact would have been antidilutive.

The following schedule summarizes the information used to compute earnings per common share:

Net (loss) income

$ (41,455)

$ 190,380

$ 40,394

Weighted average number of common shares used to compute basic net income per

226,777

226,640

228,074

Dilutive effect of stock options and restrictive stock units

Dilutive effect of outstanding warrants

—

—

4,613

2,203

4,760

175

Weighted average number of common shares used to compute diluted net income per

226,777

233,456

233,009

common share

common share

Outstanding options and awards having no dilutive effect, not included in above
calculation

107

272

52

Outstanding warrants having no dilutive effect, not included in above calculation

32,938

35,939

30,434

Basic (loss) earnings per common share

Diluted (loss) earnings per common share

$ (0.18)

$ (0.18)

$ 0.84

$ 0.82

$ 0.18

$ 0.17

20. Commitments and Contingencies

We have licensing agreements with companies, universities and individuals, some of which require certain up-front
payments. Royalty payments are required on net product sales ranging from 0.45 percent to 25 percent of covered
products or based on quantities sold. Several of these agreements have minimum royalty requirements. The
accompanying consolidated balance sheets include accrued royalties relating to these agreements in the amount of
$5.5 million at December 31, 2019 and 2018. Royalty expense relating to these agreements amounted to $13.5
million, $14.0 million, and $16.8 million for the years ended December 31, 2019, 2018 and 2017, respectively.
Royalty expense is primarily recorded in cost of sales, with a small portion recorded as research and development
expense depending on the use of the technology under license. Some of these agreements also have minimum raw
material purchase requirements and requirements to perform specific types of research.

At December 31, 2019, we had commitments to purchase goods or services, and for future license and royalty
payments. They are as follows:

2020

2021

2022

2023

2024

Thereafter

$ 126,121

$ 11,434

35,915

26,337

3,223

3,000

—

9,012

6,507

4,382

1,823

4,297

$ 194,596

$ 37,455

As of December 31, 2019, future license payments of $10.0 million and $14.5 million are included in accrued and
other current liabilities and other long-term liabilities, respectively.

Pursuant to the purchase agreements for certain acquisitions and other contractual arrangements, we could be
required to make additional contingent cash payments totaling up to $179.4 million based on the achievement of
certain revenue and operating results milestones as follows:

2020

2021

2022

2024

Anytime 12-month period from now until 2028

$ 152,750

11,800

5,900

5,900

3,000

$ 179,350

Of the $179.4 million total contingent obligation as discussed further in Note 15 "Financial Instruments and Fair
Value Measurements", we have assessed the fair value at December 31, 2019 to be $162.2 million, of which
$142.6 million is included in accrued and other current liabilities and $19.6 million is included in other long-term
liabilities in the accompanying consolidated balance sheet.

198

Certain of our employment contracts contain provisions which guarantee the payments of certain amounts in the
event of a change in control, as defined in the agreements, or if the executive is terminated for reasons other than

cause, as defined in the agreements. At December 31, 2019, the commitment under these agreements totaled $6.2

million.

In the ordinary course of business, we provide a warranty to customers that our products are free of defects and will

conform to published specifications. Generally, the applicable product warranty period is one year from the date of

delivery of the product to the customer or of site acceptance, if required. Additionally, we typically provide limited

warranties with respect to our services. From time to time, we also make other warranties to customers, including

warranties that our products are manufactured in accordance with applicable laws and not in violation of third-party

rights. We provide for estimated warranty costs at the time of the product sale. We believe our warranty reserves as

of December 31, 2019 and 2018 appropriately reflect the estimated cost of such warranty obligations. The changes

in the carrying amount of warranty obligations for the years ended December 31, 2019 and 2018 are as follows:

Licensing and Purchase Commitments(in thousands, except per share data)Years ended December 31,201920182017Contingent Consideration CommitmentsEmployment AgreementsContingencies(in thousands)PurchaseCommitmentsLicense & RoyaltyCommitments(in thousands)Contingent CashPayments 
 
2020

2021

2022

2023

2024

Thereafter

As of December 31, 2019, future license payments of $10.0 million and $14.5 million are included in accrued and

other current liabilities and other long-term liabilities, respectively.

Pursuant to the purchase agreements for certain acquisitions and other contractual arrangements, we could be

required to make additional contingent cash payments totaling up to $179.4 million based on the achievement of

certain revenue and operating results milestones as follows:

$ 126,121

$ 11,434

35,915

26,337

3,223

3,000

—

9,012

6,507

4,382

1,823

4,297

$ 194,596

$ 37,455

$ 152,750

11,800

5,900

5,900

3,000

$ 179,350

2020

2021

F I N A N C I A L   R E S U LT S Notes to consolidated financial statements

2022

2024

Anytime 12-month period from now until 2028

Of the $179.4 million total contingent obligation as discussed further in Note 15 "Financial Instruments and Fair
Value Measurements", we have assessed the fair value at December 31, 2019 to be $162.2 million, of which
$142.6 million is included in accrued and other current liabilities and $19.6 million is included in other long-term
liabilities in the accompanying consolidated balance sheet.

Certain of our employment contracts contain provisions which guarantee the payments of certain amounts in the
event of a change in control, as defined in the agreements, or if the executive is terminated for reasons other than
cause, as defined in the agreements. At December 31, 2019, the commitment under these agreements totaled $6.2
million.

In the ordinary course of business, we provide a warranty to customers that our products are free of defects and will
conform to published specifications. Generally, the applicable product warranty period is one year from the date of
delivery of the product to the customer or of site acceptance, if required. Additionally, we typically provide limited
warranties with respect to our services. From time to time, we also make other warranties to customers, including
warranties that our products are manufactured in accordance with applicable laws and not in violation of third-party
rights. We provide for estimated warranty costs at the time of the product sale. We believe our warranty reserves as
of December 31, 2019 and 2018 appropriately reflect the estimated cost of such warranty obligations. The changes
in the carrying amount of warranty obligations for the years ended December 31, 2019 and 2018 are as follows:

Balance at beginning of year
Balance at beginning of year

Balance at beginning of year
Balance at beginning of year

Provision charged to cost of sales
Provision charged to cost of sales

Provision charged to cost of sales
Provision charged to cost of sales

Usage
Usage

Usage
Usage

Adjustments to previously provided warranties, net
Adjustments to previously provided warranties, net

Adjustments to previously provided warranties, net
Adjustments to previously provided warranties, net

Currency translation
Currency translation

Currency translation
Currency translation

Balance at end of year
Balance at end of year

Balance at end of year
Balance at end of year

$ 2,848
$ 2,848

$ 2,848
$ 2,848

$ 3,051
$ 3,051

$ 3,051
$ 3,051

3,229
3,229

3,229
3,229

2,892
2,892

2,892
2,892

(2,921)
(2,921)

(2,921)
(2,921)

(2,760)
(2,760)

(2,760)
(2,760)

(1)
(1)

(1)
(1)

(243)
(243)

(243)
(243)

(14)
(14)

(14)
(14)

(92)
(92)

(92)
(92)

$ 3,141
$ 3,141

$ 3,141
$ 3,141

$ 2,848
$ 2,848

$ 2,848
$ 2,848

From time to time, we may be party to legal proceedings incidental to our business. As of December 31, 2019,
From time to time, we may be party to legal proceedings incidental to our business. As of December 31, 2019,
From time to time, we may be party to legal proceedings incidental to our business. As of December 31, 2019,
From time to time, we may be party to legal proceedings incidental to our business. As of December 31, 2019,
certain claims, suits or legal proceedings arising out of the normal course of business have been filed or were
certain claims, suits or legal proceedings arising out of the normal course of business have been filed or were
certain claims, suits or legal proceedings arising out of the normal course of business have been filed or were
certain claims, suits or legal proceedings arising out of the normal course of business have been filed or were
pending against QIAGEN or our subsidiaries. These matters have arisen in the ordinary course and conduct of
pending against QIAGEN or our subsidiaries. These matters have arisen in the ordinary course and conduct of
pending against QIAGEN or our subsidiaries. These matters have arisen in the ordinary course and conduct of
pending against QIAGEN or our subsidiaries. These matters have arisen in the ordinary course and conduct of
business, as well as through acquisition. Although it is not possible to predict the outcome of such litigation, we
business, as well as through acquisition. Although it is not possible to predict the outcome of such litigation, we
business, as well as through acquisition. Although it is not possible to predict the outcome of such litigation, we
business, as well as through acquisition. Although it is not possible to predict the outcome of such litigation, we
assess the degree of probability and evaluate the reasonably possible losses that we could incur as a result of these
assess the degree of probability and evaluate the reasonably possible losses that we could incur as a result of these
assess the degree of probability and evaluate the reasonably possible losses that we could incur as a result of these
assess the degree of probability and evaluate the reasonably possible losses that we could incur as a result of these
matters. We accrue for any estimated loss when it is probable that a liability has been incurred and the amount of
matters. We accrue for any estimated loss when it is probable that a liability has been incurred and the amount of
matters. We accrue for any estimated loss when it is probable that a liability has been incurred and the amount of
matters. We accrue for any estimated loss when it is probable that a liability has been incurred and the amount of
probable loss can be estimated.
probable loss can be estimated.
probable loss can be estimated.
probable loss can be estimated.

Litigation accruals recorded in accrued and other current liabilities totaled $0.8 million and $6.0 million as of
Litigation accruals recorded in accrued and other current liabilities totaled $0.8 million and $6.0 million as of
Litigation accruals recorded in accrued and other current liabilities totaled $0.8 million and $6.0 million as of
Litigation accruals recorded in accrued and other current liabilities totaled $0.8 million and $6.0 million as of
December 31, 2019 and 2018, respectively. The estimated amount of a range of possible losses is between $0.3
December 31, 2019 and 2018, respectively. The estimated amount of a range of possible losses is between $0.3
December 31, 2019 and 2018, respectively. The estimated amount of a range of possible losses is between $0.3
December 31, 2019 and 2018, respectively. The estimated amount of a range of possible losses is between $0.3
million and $2.2 million. During the year ended December 31, 2019, payments of $5.4 million related to previous
million and $2.2 million. During the year ended December 31, 2019, payments of $5.4 million related to previous
million and $2.2 million. During the year ended December 31, 2019, payments of $5.4 million related to previous
million and $2.2 million. During the year ended December 31, 2019, payments of $5.4 million related to previous
matters were made. Based on the facts known to QIAGEN and after consultation with legal counsel, management
matters were made. Based on the facts known to QIAGEN and after consultation with legal counsel, management
matters were made. Based on the facts known to QIAGEN and after consultation with legal counsel, management
matters were made. Based on the facts known to QIAGEN and after consultation with legal counsel, management
believes that such litigation will not have a material adverse effect on our financial position or results of operations
believes that such litigation will not have a material adverse effect on our financial position or results of operations
believes that such litigation will not have a material adverse effect on our financial position or results of operations
believes that such litigation will not have a material adverse effect on our financial position or results of operations
above the amounts accrued. However, the outcome of these matters is ultimately uncertain, thus any settlements or
above the amounts accrued. However, the outcome of these matters is ultimately uncertain, thus any settlements or
above the amounts accrued. However, the outcome of these matters is ultimately uncertain, thus any settlements or
above the amounts accrued. However, the outcome of these matters is ultimately uncertain, thus any settlements or
judgments against us in excess of management's expectations could have a material adverse effect on our financial
judgments against us in excess of management's expectations could have a material adverse effect on our financial
judgments against us in excess of management's expectations could have a material adverse effect on our financial
judgments against us in excess of management's expectations could have a material adverse effect on our financial
position, results of operations or cash flows.
position, results of operations or cash flows.
position, results of operations or cash flows.
position, results of operations or cash flows.

For the year ended December 31, 2017, we had settlement amounts related to various acquisition-related litigation
For the year ended December 31, 2017, we had settlement amounts related to various acquisition-related litigation
matters totaling $49.2 million, primarily related to PCR-based biomarker disputes and patent litigation, which were
matters totaling $49.2 million, primarily related to PCR-based biomarker disputes and patent litigation, which were
199
settled during 2017 of which $45.3 million was recorded to restructuring, acquisition, integration and other, net and
settled during 2017 of which $45.3 million was recorded to restructuring, acquisition, integration and other, net and
$3.9 million was recorded as a license right. $44.8 million of the settlement amounts were paid during 2017 and as
$3.9 million was recorded as a license right. $44.8 million of the settlement amounts were paid during 2017 and as

For the year ended December 31, 2017, we had settlement amounts related to various acquisition-related litigation
For the year ended December 31, 2017, we had settlement amounts related to various acquisition-related litigation
matters totaling $49.2 million, primarily related to PCR-based biomarker disputes and patent litigation, which were
matters totaling $49.2 million, primarily related to PCR-based biomarker disputes and patent litigation, which were
settled during 2017 of which $45.3 million was recorded to restructuring, acquisition, integration and other, net and
settled during 2017 of which $45.3 million was recorded to restructuring, acquisition, integration and other, net and
$3.9 million was recorded as a license right. $44.8 million of the settlement amounts were paid during 2017 and as
$3.9 million was recorded as a license right. $44.8 million of the settlement amounts were paid during 2017 and as

of December 31, 2017, $4.4 million was accrued in accrued and other current liabilities.

of December 31, 2017, $4.4 million was accrued in accrued and other current liabilities.

of December 31, 2017, $4.4 million was accrued in accrued and other current liabilities.

of December 31, 2017, $4.4 million was accrued in accrued and other current liabilities.

21. Segment Information

21. Segment Information

21. Segment Information

21. Segment Information

We operate as one operating segment in accordance with the Financial Accounting Standards Board (FASB)

We operate as one operating segment in accordance with the Financial Accounting Standards Board (FASB)

We operate as one operating segment in accordance with the Financial Accounting Standards Board (FASB)

We operate as one operating segment in accordance with the Financial Accounting Standards Board (FASB)

Accounting Standards Codification (ASC) Topic 280, Segment Reporting. We have a common basis of organization

Accounting Standards Codification (ASC) Topic 280, Segment Reporting. We have a common basis of organization

Accounting Standards Codification (ASC) Topic 280, Segment Reporting. We have a common basis of organization

Accounting Standards Codification (ASC) Topic 280, Segment Reporting. We have a common basis of organization

and our products and services are offered globally. Considering the acquisitions made during 2019 and our

and our products and services are offered globally. Considering the acquisitions made during 2019 and our

and our products and services are offered globally. Considering the acquisitions made during 2019 and our

and our products and services are offered globally. Considering the acquisitions made during 2019 and our

continued restructuring and streamlining of the growing organization, our chief operating decision maker (CODM)

continued restructuring and streamlining of the growing organization, our chief operating decision maker (CODM)

continued restructuring and streamlining of the growing organization, our chief operating decision maker (CODM)

continued restructuring and streamlining of the growing organization, our chief operating decision maker (CODM)

continues to make decisions with regards to business operations and resource allocation based on evaluations of

continues to make decisions with regards to business operations and resource allocation based on evaluations of

continues to make decisions with regards to business operations and resource allocation based on evaluations of

continues to make decisions with regards to business operations and resource allocation based on evaluations of

QIAGEN as a whole. Accordingly, we operate and make decisions as one business segment. Product category and

QIAGEN as a whole. Accordingly, we operate and make decisions as one business segment. Product category and

QIAGEN as a whole. Accordingly, we operate and make decisions as one business segment. Product category and

QIAGEN as a whole. Accordingly, we operate and make decisions as one business segment. Product category and

geographic information follows below.

geographic information follows below.

geographic information follows below.

geographic information follows below.

Net sales for the product categories are attributed based on those revenues related to sample and assay products

Net sales for the product categories are attributed based on those revenues related to sample and assay products

Net sales for the product categories are attributed based on those revenues related to sample and assay products

Net sales for the product categories are attributed based on those revenues related to sample and assay products

and similarly related revenues including bioinformatics solutions, and revenues derived from instrumentation sales.

and similarly related revenues including bioinformatics solutions, and revenues derived from instrumentation sales.

and similarly related revenues including bioinformatics solutions, and revenues derived from instrumentation sales.

and similarly related revenues including bioinformatics solutions, and revenues derived from instrumentation sales.

Refer to Note 4 "Revenue" for disaggregation of revenue based on product categories and customer class.

Refer to Note 4 "Revenue" for disaggregation of revenue based on product categories and customer class.

Refer to Note 4 "Revenue" for disaggregation of revenue based on product categories and customer class.

Refer to Note 4 "Revenue" for disaggregation of revenue based on product categories and customer class.

Net sales are attributed to countries based on the location of the customer. QIAGEN operates manufacturing

Net sales are attributed to countries based on the location of the customer. QIAGEN operates manufacturing

Net sales are attributed to countries based on the location of the customer. QIAGEN operates manufacturing

Net sales are attributed to countries based on the location of the customer. QIAGEN operates manufacturing

facilities in Germany, China, and the United States that supply products to customers as well as QIAGEN

facilities in Germany, China, and the United States that supply products to customers as well as QIAGEN

facilities in Germany, China, and the United States that supply products to customers as well as QIAGEN

facilities in Germany, China, and the United States that supply products to customers as well as QIAGEN

Contingent Consideration CommitmentsEmployment AgreementsContingencies(in thousands)PurchaseCommitmentsLicense & RoyaltyCommitments(in thousands)Contingent CashPaymentsLitigationProduct Category InformationGeographical Information(in thousands)20192018LitigationProduct Category InformationGeographical Information(in thousands)20192018LitigationProduct Category InformationGeographical Information(in thousands)20192018LitigationProduct Category InformationGeographical Information(in thousands)20192018Balance at beginning of year

Provision charged to cost of sales

Usage

Currency translation

Balance at end of year

Adjustments to previously provided warranties, net

$ 2,848

3,229

(2,921)

(1)

(14)

$ 3,051

2,892

(2,760)

(243)

(92)

$ 3,141

$ 2,848

From time to time, we may be party to legal proceedings incidental to our business. As of December 31, 2019,

certain claims, suits or legal proceedings arising out of the normal course of business have been filed or were

pending against QIAGEN or our subsidiaries. These matters have arisen in the ordinary course and conduct of

business, as well as through acquisition. Although it is not possible to predict the outcome of such litigation, we

assess the degree of probability and evaluate the reasonably possible losses that we could incur as a result of these

matters. We accrue for any estimated loss when it is probable that a liability has been incurred and the amount of

probable loss can be estimated.

Litigation accruals recorded in accrued and other current liabilities totaled $0.8 million and $6.0 million as of
December 31, 2019 and 2018, respectively. The estimated amount of a range of possible losses is between $0.3
million and $2.2 million. During the year ended December 31, 2019, payments of $5.4 million related to previous
matters were made. Based on the facts known to QIAGEN and after consultation with legal counsel, management
believes that such litigation will not have a material adverse effect on our financial position or results of operations
above the amounts accrued. However, the outcome of these matters is ultimately uncertain, thus any settlements or
judgments against us in excess of management's expectations could have a material adverse effect on our financial
position, results of operations or cash flows.

For the year ended December 31, 2017, we had settlement amounts related to various acquisition-related litigation
matters totaling $49.2 million, primarily related to PCR-based biomarker disputes and patent litigation, which were
settled during 2017 of which $45.3 million was recorded to restructuring, acquisition, integration and other, net and
$3.9 million was recorded as a license right. $44.8 million of the settlement amounts were paid during 2017 and as
of December 31, 2017, $4.4 million was accrued in accrued and other current liabilities.

21. Segment Information

We operate as one operating segment in accordance with the Financial Accounting Standards Board (FASB)
Accounting Standards Codification (ASC) Topic 280, Segment Reporting. We have a common basis of organization
and our products and services are offered globally. Considering the acquisitions made during 2019 and our
continued restructuring and streamlining of the growing organization, our chief operating decision maker (CODM)
continues to make decisions with regards to business operations and resource allocation based on evaluations of
QIAGEN as a whole. Accordingly, we operate and make decisions as one business segment. Product category and
geographic information follows below.

Net sales for the product categories are attributed based on those revenues related to sample and assay products
and similarly related revenues including bioinformatics solutions, and revenues derived from instrumentation sales.
Refer to Note 4 "Revenue" for disaggregation of revenue based on product categories and customer class.

Net sales are attributed to countries based on the location of the customer. QIAGEN operates manufacturing
facilities in Germany, China, and the United States that supply products to customers as well as QIAGEN
subsidiaries in other countries. The intersegment portions of such net sales are excluded to derive consolidated net
subsidiaries in other countries. The intersegment portions of such net sales are excluded to derive consolidated net
subsidiaries in other countries. The intersegment portions of such net sales are excluded to derive consolidated net
sales. No single customer represents more than ten percent of consolidated net sales. Our country of domicile is the
sales. No single customer represents more than ten percent of consolidated net sales. Our country of domicile is the
sales. No single customer represents more than ten percent of consolidated net sales. Our country of domicile is the
Netherlands, which reported net sales of $15.8 million, $15.9 million and $15.0 million for the years ended 2019,
Netherlands, which reported net sales of $15.8 million, $15.9 million and $15.0 million for the years ended 2019,
Netherlands, which reported net sales of $15.8 million, $15.9 million and $15.0 million for the years ended 2019,
2018 and 2017, respectively, and these amounts are included in the line item Europe, Middle East and Africa as
2018 and 2017, respectively, and these amounts are included in the line item Europe, Middle East and Africa as
2018 and 2017, respectively, and these amounts are included in the line item Europe, Middle East and Africa as
shown in the table below.
shown in the table below.
shown in the table below.

subsidiaries in other countries. The intersegment portions of such net sales are excluded to derive consolidated net
subsidiaries in other countries. The intersegment portions of such net sales are excluded to derive consolidated net
sales. No single customer represents more than ten percent of consolidated net sales. Our country of domicile is the
sales. No single customer represents more than ten percent of consolidated net sales. Our country of domicile is the
Netherlands, which reported net sales of $15.8 million, $15.9 million and $15.0 million for the years ended 2019,
Netherlands, which reported net sales of $15.8 million, $15.9 million and $15.0 million for the years ended 2019,
2018 and 2017, respectively, and these amounts are included in the line item Europe, Middle East and Africa as
2018 and 2017, respectively, and these amounts are included in the line item Europe, Middle East and Africa as
shown in the table below.
shown in the table below.

Americas:
Americas:
Americas:

Americas:
Americas:

United States
United States
United States

United States
United States

Other Americas
Other Americas
Other Americas

Other Americas
Other Americas

Total Americas
Total Americas
Total Americas

Total Americas
Total Americas

$ 663,869
$ 663,869
$ 663,869

$ 663,869
$ 663,869

$ 632,660
$ 632,660
$ 632,660

$ 632,660
$ 632,660

$ 579,906
$ 579,906
$ 579,906

$ 579,906
$ 579,906

58,121
58,121
58,121

58,121
58,121

60,359
60,359
60,359

60,359
60,359

73,478
73,478
73,478

73,478
73,478

721,990
721,990
721,990

721,990
721,990

693,019
693,019
693,019

693,019
693,019

653,384
653,384
653,384

653,384
653,384

Europe, Middle East and Africa
Europe, Middle East and Africa
Europe, Middle East and Africa

Europe, Middle East and Africa
Europe, Middle East and Africa

487,476
487,476
487,476

487,476
487,476

490,301
490,301
490,301

490,301
490,301

462,980
462,980
462,980

462,980
462,980

Asia Pacific, Japan and Rest of World
Asia Pacific, Japan and Rest of World
Asia Pacific, Japan and Rest of World

Asia Pacific, Japan and Rest of World
Asia Pacific, Japan and Rest of World

316,958
316,958
316,958

316,958
316,958

318,528
318,528
318,528

318,528
318,528

301,172
301,172
301,172

301,172
301,172

Total
Total
Total

Total
Total

$ 1,526,424
$ 1,526,424
$ 1,526,424

$ 1,526,424
$ 1,526,424

$ 1,501,848
$ 1,501,848
$ 1,501,848

$ 1,501,848
$ 1,501,848

$ 1,417,536
$ 1,417,536
$ 1,417,536

$ 1,417,536
$ 1,417,536

Long-lived assets include property, plant and equipment. The Netherlands, which is included in the balances for
Long-lived assets include property, plant and equipment. The Netherlands, which is included in the balances for
Long-lived assets include property, plant and equipment. The Netherlands, which is included in the balances for
Long-lived assets include property, plant and equipment. The Netherlands, which is included in the balances for
Long-lived assets include property, plant and equipment. The Netherlands, which is included in the balances for
Europe, reported long-lived assets of $1.3 million and $1.8 million as of December 31, 2019 and 2018,
Europe, reported long-lived assets of $1.3 million and $1.8 million as of December 31, 2019 and 2018,
Europe, reported long-lived assets of $1.3 million and $1.8 million as of December 31, 2019 and 2018,
Europe, reported long-lived assets of $1.3 million and $1.8 million as of December 31, 2019 and 2018,
Europe, reported long-lived assets of $1.3 million and $1.8 million as of December 31, 2019 and 2018,
respectively.
respectively.
respectively.
respectively.
respectively.

200

Americas:
Americas:
Americas:

Americas:
Americas:

United States

United States

United States

United States

United States

Other Americas

Other Americas

Other Americas

Other Americas

Other Americas

Total Americas

Total Americas

Total Americas

Total Americas

Total Americas

Europe, Middle East and Africa:

Europe, Middle East and Africa:

Europe, Middle East and Africa:

Europe, Middle East and Africa:

Europe, Middle East and Africa:

Germany

Germany

Germany

Germany

Germany

Other Europe, Middle East and Africa

Other Europe, Middle East and Africa

Other Europe, Middle East and Africa

Other Europe, Middle East and Africa

Other Europe, Middle East and Africa

Total Europe, Middle East and Africa

Total Europe, Middle East and Africa

Total Europe, Middle East and Africa

Total Europe, Middle East and Africa

Total Europe, Middle East and Africa

Asia Pacific and Japan

Asia Pacific and Japan

Asia Pacific and Japan

Asia Pacific and Japan

Asia Pacific and Japan

Total

Total

Total

Total

Total

$ 147,027

$ 147,027

$ 147,027

$ 147,027

$ 147,027

$ 152,381

$ 152,381

$ 152,381

$ 152,381

$ 152,381

3,507

3,507

3,507

3,507

3,507

3,748

3,748

3,748

3,748

3,748

150,534

150,534

150,534

150,534

150,534

156,129

156,129

156,129

156,129

156,129

229,225

229,225

229,225

229,225

229,225

284,601

284,601

284,601

284,601

284,601

49,004

49,004

49,004

49,004

49,004

50,051

50,051

50,051

50,051

50,051

278,229

278,229

278,229

278,229

278,229

334,652

334,652

334,652

334,652

334,652

26,480

26,480

26,480

26,480

26,480

20,878

20,878

20,878

20,878

20,878

$ 455,243

$ 455,243

$ 455,243

$ 455,243

$ 455,243

$ 511,659

$ 511,659

$ 511,659

$ 511,659

$ 511,659

22. Share-Based Compensation

22. Share-Based Compensation

22. Share-Based Compensation

22. Share-Based Compensation

22. Share-Based Compensation

We adopted the QIAGEN N.V. Amended and Restated 2005 Stock Plan (the 2005 Plan) in 2005 and the QIAGEN

We adopted the QIAGEN N.V. Amended and Restated 2005 Stock Plan (the 2005 Plan) in 2005 and the QIAGEN

We adopted the QIAGEN N.V. Amended and Restated 2005 Stock Plan (the 2005 Plan) in 2005 and the QIAGEN

We adopted the QIAGEN N.V. Amended and Restated 2005 Stock Plan (the 2005 Plan) in 2005 and the QIAGEN

We adopted the QIAGEN N.V. Amended and Restated 2005 Stock Plan (the 2005 Plan) in 2005 and the QIAGEN

N.V. 2014 Stock Plan (the 2014 Plan) in 2014. The 2005 Plan expired by its terms in April 2015 and no further

N.V. 2014 Stock Plan (the 2014 Plan) in 2014. The 2005 Plan expired by its terms in April 2015 and no further

N.V. 2014 Stock Plan (the 2014 Plan) in 2014. The 2005 Plan expired by its terms in April 2015 and no further

N.V. 2014 Stock Plan (the 2014 Plan) in 2014. The 2005 Plan expired by its terms in April 2015 and no further

N.V. 2014 Stock Plan (the 2014 Plan) in 2014. The 2005 Plan expired by its terms in April 2015 and no further

awards will be granted under the 2005 Plan. The plans allow for the granting of stock rights and incentive stock

awards will be granted under the 2005 Plan. The plans allow for the granting of stock rights and incentive stock

awards will be granted under the 2005 Plan. The plans allow for the granting of stock rights and incentive stock

awards will be granted under the 2005 Plan. The plans allow for the granting of stock rights and incentive stock

awards will be granted under the 2005 Plan. The plans allow for the granting of stock rights and incentive stock

options, as well as non-qualified options, stock grants and stock-based awards, generally with terms of up to 5 or 10

options, as well as non-qualified options, stock grants and stock-based awards, generally with terms of up to 5 or 10

options, as well as non-qualified options, stock grants and stock-based awards, generally with terms of up to 5 or 10

options, as well as non-qualified options, stock grants and stock-based awards, generally with terms of up to 5 or 10

options, as well as non-qualified options, stock grants and stock-based awards, generally with terms of up to 5 or 10

years, subject to earlier termination in certain situations. The vesting and exercisability of certain stock rights will be

years, subject to earlier termination in certain situations. The vesting and exercisability of certain stock rights will be

years, subject to earlier termination in certain situations. The vesting and exercisability of certain stock rights will be

years, subject to earlier termination in certain situations. The vesting and exercisability of certain stock rights will be

years, subject to earlier termination in certain situations. The vesting and exercisability of certain stock rights will be

accelerated in the event of a Change of Control, as defined in the plans. All option grants have been at the market

accelerated in the event of a Change of Control, as defined in the plans. All option grants have been at the market

accelerated in the event of a Change of Control, as defined in the plans. All option grants have been at the market

accelerated in the event of a Change of Control, as defined in the plans. All option grants have been at the market

accelerated in the event of a Change of Control, as defined in the plans. All option grants have been at the market

value on the grant date or at a premium above the closing market price on the grant date. We issue Treasury Shares

value on the grant date or at a premium above the closing market price on the grant date. We issue Treasury Shares

value on the grant date or at a premium above the closing market price on the grant date. We issue Treasury Shares

value on the grant date or at a premium above the closing market price on the grant date. We issue Treasury Shares

value on the grant date or at a premium above the closing market price on the grant date. We issue Treasury Shares

to satisfy option exercises and award releases and had approximately 15.7 million Common Shares reserved and

to satisfy option exercises and award releases and had approximately 15.7 million Common Shares reserved and

to satisfy option exercises and award releases and had approximately 15.7 million Common Shares reserved and

to satisfy option exercises and award releases and had approximately 15.7 million Common Shares reserved and

to satisfy option exercises and award releases and had approximately 15.7 million Common Shares reserved and

available for issuance under the 2005 and 2014 Plans at December 31, 2019.

available for issuance under the 2005 and 2014 Plans at December 31, 2019.

available for issuance under the 2005 and 2014 Plans at December 31, 2019.

available for issuance under the 2005 and 2014 Plans at December 31, 2019.

available for issuance under the 2005 and 2014 Plans at December 31, 2019.

LitigationProduct Category InformationGeographical Information(in thousands)20192018Stock Options(in thousands)201920182017Net Sales(in thousands)20192018Long-lived assetsStock Options(in thousands)201920182017Net Sales(in thousands)20192018Long-lived assetsStock Options(in thousands)201920182017Net Sales(in thousands)20192018Long-lived assetsStock Options(in thousands)201920182017Net Sales(in thousands)20192018Long-lived assetsStock Options(in thousands)201920182017Net Sales(in thousands)20192018Long-lived assetssubsidiaries in other countries. The intersegment portions of such net sales are excluded to derive consolidated net

subsidiaries in other countries. The intersegment portions of such net sales are excluded to derive consolidated net

subsidiaries in other countries. The intersegment portions of such net sales are excluded to derive consolidated net

subsidiaries in other countries. The intersegment portions of such net sales are excluded to derive consolidated net

sales. No single customer represents more than ten percent of consolidated net sales. Our country of domicile is the

sales. No single customer represents more than ten percent of consolidated net sales. Our country of domicile is the

sales. No single customer represents more than ten percent of consolidated net sales. Our country of domicile is the

sales. No single customer represents more than ten percent of consolidated net sales. Our country of domicile is the

Netherlands, which reported net sales of $15.8 million, $15.9 million and $15.0 million for the years ended 2019,

Netherlands, which reported net sales of $15.8 million, $15.9 million and $15.0 million for the years ended 2019,

Netherlands, which reported net sales of $15.8 million, $15.9 million and $15.0 million for the years ended 2019,

Netherlands, which reported net sales of $15.8 million, $15.9 million and $15.0 million for the years ended 2019,

2018 and 2017, respectively, and these amounts are included in the line item Europe, Middle East and Africa as

2018 and 2017, respectively, and these amounts are included in the line item Europe, Middle East and Africa as

2018 and 2017, respectively, and these amounts are included in the line item Europe, Middle East and Africa as

2018 and 2017, respectively, and these amounts are included in the line item Europe, Middle East and Africa as

shown in the table below.

shown in the table below.

shown in the table below.

shown in the table below.

Americas:

Americas:

Americas:

Americas:

United States

United States

United States

United States

Other Americas

Other Americas

Other Americas

Other Americas

Total Americas

Total Americas

Total Americas

Total Americas

$ 663,869

$ 663,869

$ 663,869

$ 663,869

$ 632,660

$ 632,660

$ 632,660

$ 632,660

$ 579,906

$ 579,906

$ 579,906

$ 579,906

58,121

58,121

58,121

58,121

60,359

60,359

60,359

60,359

73,478

73,478

73,478

73,478

721,990

721,990

721,990

721,990

693,019

693,019

693,019

693,019

653,384

653,384

653,384

653,384

Europe, Middle East and Africa

Europe, Middle East and Africa

Europe, Middle East and Africa

Europe, Middle East and Africa

487,476

487,476

487,476

487,476

490,301

490,301

490,301

490,301

462,980

462,980

462,980

462,980

Asia Pacific, Japan and Rest of World
Asia Pacific, Japan and Rest of World

Asia Pacific, Japan and Rest of World
Asia Pacific, Japan and Rest of World

316,958
316,958

316,958
316,958

318,528
318,528

318,528
318,528

301,172
301,172

301,172
301,172

F I N A N C I A L   R E S U LT S Notes to consolidated financial statements

Total
Total

Total
Total

$ 1,526,424
$ 1,526,424

$ 1,526,424
$ 1,526,424

$ 1,501,848
$ 1,501,848

$ 1,501,848
$ 1,501,848

$ 1,417,536
$ 1,417,536

$ 1,417,536
$ 1,417,536

Long-lived assets include property, plant and equipment. The Netherlands, which is included in the balances for
Long-lived assets include property, plant and equipment. The Netherlands, which is included in the balances for
Long-lived assets include property, plant and equipment. The Netherlands, which is included in the balances for
Long-lived assets include property, plant and equipment. The Netherlands, which is included in the balances for
Europe, reported long-lived assets of $1.3 million and $1.8 million as of December 31, 2019 and 2018,
Europe, reported long-lived assets of $1.3 million and $1.8 million as of December 31, 2019 and 2018,
Europe, reported long-lived assets of $1.3 million and $1.8 million as of December 31, 2019 and 2018,
Europe, reported long-lived assets of $1.3 million and $1.8 million as of December 31, 2019 and 2018,
respectively.
respectively.
respectively.
respectively.

Americas:
Americas:

Americas:
Americas:

United States
United States

United States
United States

Other Americas
Other Americas

Other Americas
Other Americas

Total Americas
Total Americas

Total Americas
Total Americas

Europe, Middle East and Africa:
Europe, Middle East and Africa:

Europe, Middle East and Africa:
Europe, Middle East and Africa:

Germany
Germany

Germany
Germany

Other Europe, Middle East and Africa
Other Europe, Middle East and Africa

Other Europe, Middle East and Africa
Other Europe, Middle East and Africa

Total Europe, Middle East and Africa
Total Europe, Middle East and Africa

Total Europe, Middle East and Africa
Total Europe, Middle East and Africa

Asia Pacific and Japan
Asia Pacific and Japan

Asia Pacific and Japan
Asia Pacific and Japan

Total
Total

Total
Total

$ 147,027
$ 147,027

$ 147,027
$ 147,027

$ 152,381
$ 152,381

$ 152,381
$ 152,381

3,507
3,507

3,507
3,507

3,748
3,748

3,748
3,748

150,534
150,534

150,534
150,534

156,129
156,129

156,129
156,129

229,225
229,225

229,225
229,225

284,601
284,601

284,601
284,601

49,004
49,004

49,004
49,004

50,051
50,051

50,051
50,051

278,229
278,229

278,229
278,229

334,652
334,652

334,652
334,652

26,480
26,480

26,480
26,480

20,878
20,878

20,878
20,878

$ 455,243
$ 455,243

$ 455,243
$ 455,243

$ 511,659
$ 511,659

$ 511,659
$ 511,659

22. Share-Based Compensation
22. Share-Based Compensation

22. Share-Based Compensation
22. Share-Based Compensation

We adopted the QIAGEN N.V. Amended and Restated 2005 Stock Plan (the 2005 Plan) in 2005 and the QIAGEN
We adopted the QIAGEN N.V. Amended and Restated 2005 Stock Plan (the 2005 Plan) in 2005 and the QIAGEN
We adopted the QIAGEN N.V. Amended and Restated 2005 Stock Plan (the 2005 Plan) in 2005 and the QIAGEN
We adopted the QIAGEN N.V. Amended and Restated 2005 Stock Plan (the 2005 Plan) in 2005 and the QIAGEN
N.V. 2014 Stock Plan (the 2014 Plan) in 2014. The 2005 Plan expired by its terms in April 2015 and no further
N.V. 2014 Stock Plan (the 2014 Plan) in 2014. The 2005 Plan expired by its terms in April 2015 and no further
N.V. 2014 Stock Plan (the 2014 Plan) in 2014. The 2005 Plan expired by its terms in April 2015 and no further
N.V. 2014 Stock Plan (the 2014 Plan) in 2014. The 2005 Plan expired by its terms in April 2015 and no further
awards will be granted under the 2005 Plan. The plans allow for the granting of stock rights and incentive stock
awards will be granted under the 2005 Plan. The plans allow for the granting of stock rights and incentive stock
awards will be granted under the 2005 Plan. The plans allow for the granting of stock rights and incentive stock
awards will be granted under the 2005 Plan. The plans allow for the granting of stock rights and incentive stock
options, as well as non-qualified options, stock grants and stock-based awards, generally with terms of up to 5 or 10
options, as well as non-qualified options, stock grants and stock-based awards, generally with terms of up to 5 or 10
options, as well as non-qualified options, stock grants and stock-based awards, generally with terms of up to 5 or 10
options, as well as non-qualified options, stock grants and stock-based awards, generally with terms of up to 5 or 10
years, subject to earlier termination in certain situations. The vesting and exercisability of certain stock rights will be
years, subject to earlier termination in certain situations. The vesting and exercisability of certain stock rights will be
years, subject to earlier termination in certain situations. The vesting and exercisability of certain stock rights will be
years, subject to earlier termination in certain situations. The vesting and exercisability of certain stock rights will be
accelerated in the event of a Change of Control, as defined in the plans. All option grants have been at the market
accelerated in the event of a Change of Control, as defined in the plans. All option grants have been at the market
accelerated in the event of a Change of Control, as defined in the plans. All option grants have been at the market
accelerated in the event of a Change of Control, as defined in the plans. All option grants have been at the market
value on the grant date or at a premium above the closing market price on the grant date. We issue Treasury Shares
value on the grant date or at a premium above the closing market price on the grant date. We issue Treasury Shares
value on the grant date or at a premium above the closing market price on the grant date. We issue Treasury Shares
value on the grant date or at a premium above the closing market price on the grant date. We issue Treasury Shares
to satisfy option exercises and award releases and had approximately 15.7 million Common Shares reserved and
to satisfy option exercises and award releases and had approximately 15.7 million Common Shares reserved and
to satisfy option exercises and award releases and had approximately 15.7 million Common Shares reserved and
to satisfy option exercises and award releases and had approximately 15.7 million Common Shares reserved and
available for issuance under the 2005 and 2014 Plans at December 31, 2019.
available for issuance under the 2005 and 2014 Plans at December 31, 2019.
available for issuance under the 2005 and 2014 Plans at December 31, 2019.
available for issuance under the 2005 and 2014 Plans at December 31, 2019.

We have not granted stock options since 2013. A summary of the status of employee stock options as of December
31, 2019 and changes during the year then ended is presented below:

Outstanding at January 1, 2019

Exercised

Expired

Outstanding at December 31, 2019

Vested at December 31, 2019

Vested and expected to vest at December 31, 2019

898

(104)

(2)

792

792

792

$ 20.04

$ 19.95

$ 17.51

$ 20.06

$ 20.06

$ 20.06

1.78

1.78

1.78

$ 10,891

$ 10,891

$ 10,891

The total intrinsic value of options exercised during the years ended December 31, 2019, 2018 and 2017 was
$2.0 million, $5.0 million and $3.3 million, respectively. The actual tax benefit for the tax deductions from option
exercises totaled $0.5 million, $0.8 million, and $0.7 million during the years ended December 31, 2019, 2018
and 2017, respectively. At December 31, 2019, there was no unrecognized share-based compensation expense
related to employee stock option awards.

At December 31, 2019, 2018 and 2017, 0.8 million, 0.9 million and 1.1 million options were exercisable at a
weighted average price of $20.06, $20.04 and $19.54 per share, respectively. The options outstanding at
December 31, 2019 expire in various years through 2023.

201

Stock units represent rights to receive Common Shares at a future date and include restricted stock units which are

subject to time-vesting only and performance stock units which include performance conditions in addition to time-

vesting. The final number of performance stock units earned is based on the performance achievement which for

some grants can reach up to 120% of the granted shares. There is no exercise price and the fair market value at the

time of the grant is recognized over the requisite vesting period, generally up to 5 or 10 years. The fair market value

is determined based on the number of stock units granted and the market value of our shares on the grant date. Pre-

vesting forfeitures were estimated to be approximately 6.2%. At December 31, 2019, there was $60.1 million

remaining in unrecognized compensation cost including estimated forfeitures related to these awards, which is

expected to be recognized over a weighted average period of 2.57 years. The weighted average grant date fair

value of stock units granted during the years ended December 31, 2019, 2018 and 2017 was $37.28, $35.37

and $31.12, respectively. The total fair value of stock units that vested during the years ended December 31, 2019,

2018 and 2017 was $123.9 million, $54.3 million and $69.2 million, respectively.

A summary of stock units as of December 31, 2019 and changes during the year are presented below:

Outstanding at January 1, 2019

Granted

Vested

Forfeited

Outstanding at December 31, 2019

Vested and expected to vest at December 31, 2019

8,343

1,618

(3,517)

(1,261)

5,183

3,972

2.57

2.26

$ 175,199

$ 134,254

Share-based compensation expense before taxes for the years ended December 31, 2019, 2018 and 2017 totaled

approximately $65.9 million, $40.1 million and $34.4 million, respectively, as shown in the table below.

Stock Options(in thousands)201920182017Net Sales(in thousands)20192018Long-lived assetsStock UnitsCompensation ExpenseAll Employee OptionsNumber of Shares(in thousands)Weighted AverageExercise PriceWeighted AverageContractual Term (in years)Aggregate IntrinsicValue (in thousands)Stock UnitsStock Units (in thousands)Weighted AverageContractual Term (inyears)Aggregate IntrinsicValue (in thousands)Stock Options(in thousands)201920182017Net Sales(in thousands)20192018Long-lived assetsStock Options(in thousands)201920182017Net Sales(in thousands)20192018Long-lived assetsStock Options(in thousands)201920182017Net Sales(in thousands)20192018Long-lived assetsWe have not granted stock options since 2013. A summary of the status of employee stock options as of December

31, 2019 and changes during the year then ended is presented below:

Outstanding at January 1, 2019

Exercised

Expired

Outstanding at December 31, 2019

Vested at December 31, 2019

Vested and expected to vest at December 31, 2019

898

(104)

(2)

792

792

792

$ 20.04

$ 19.95

$ 17.51

$ 20.06

$ 20.06

$ 20.06

1.78

1.78

1.78

$ 10,891

$ 10,891

$ 10,891

The total intrinsic value of options exercised during the years ended December 31, 2019, 2018 and 2017 was
$2.0 million, $5.0 million and $3.3 million, respectively. The actual tax benefit for the tax deductions from option
exercises totaled $0.5 million, $0.8 million, and $0.7 million during the years ended December 31, 2019, 2018
and 2017, respectively. At December 31, 2019, there was no unrecognized share-based compensation expense
related to employee stock option awards.

At December 31, 2019, 2018 and 2017, 0.8 million, 0.9 million and 1.1 million options were exercisable at a
weighted average price of $20.06, $20.04 and $19.54 per share, respectively. The options outstanding at
December 31, 2019 expire in various years through 2023.

Stock units represent rights to receive Common Shares at a future date and include restricted stock units which are
subject to time-vesting only and performance stock units which include performance conditions in addition to time-
vesting. The final number of performance stock units earned is based on the performance achievement which for
some grants can reach up to 120% of the granted shares. There is no exercise price and the fair market value at the
time of the grant is recognized over the requisite vesting period, generally up to 5 or 10 years. The fair market value
is determined based on the number of stock units granted and the market value of our shares on the grant date. Pre-
vesting forfeitures were estimated to be approximately 6.2%. At December 31, 2019, there was $60.1 million
remaining in unrecognized compensation cost including estimated forfeitures related to these awards, which is
expected to be recognized over a weighted average period of 2.57 years. The weighted average grant date fair
value of stock units granted during the years ended December 31, 2019, 2018 and 2017 was $37.28, $35.37
and $31.12, respectively. The total fair value of stock units that vested during the years ended December 31, 2019,
2018 and 2017 was $123.9 million, $54.3 million and $69.2 million, respectively.

A summary of stock units as of December 31, 2019 and changes during the year are presented below:

Outstanding at January 1, 2019

Granted

Vested

Forfeited

Outstanding at December 31, 2019

Vested and expected to vest at December 31, 2019

8,343

1,618

(3,517)

(1,261)

5,183

3,972

2.57

2.26

$ 175,199

$ 134,254

Share-based compensation expense before taxes for the years ended December 31, 2019, 2018 and 2017 totaled
approximately $65.9 million, $40.1 million and $34.4 million, respectively, as shown in the table below.

Cost of sales
Cost of sales

Cost of sales

Cost of sales

Research and development
Research and development

Research and development

Research and development

Sales and marketing
Sales and marketing

Sales and marketing

Sales and marketing

General and administrative
General and administrative

General and administrative

General and administrative

Restructuring, acquisition, integration and other, net
Restructuring, acquisition, integration and other, net

Restructuring, acquisition, integration and other, net

Restructuring, acquisition, integration and other, net

Share-based compensation expense
Share-based compensation expense

Share-based compensation expense

Share-based compensation expense

$ 2,493
$ 2,493

$ 2,493

$ 2,493

$ 2,879
$ 2,879

$ 2,879

$ 2,879

$ 2,641
$ 2,641

$ 2,641

$ 2,641

5,810
5,810

5,810

5,810

6,457
6,457

6,457

6,457

6,102
6,102

6,102

6,102

7,947
7,947

7,947

7,947

9,372
9,372

9,372

9,372

6,820
6,820

6,820

6,820

23,706
23,706

23,706

23,706

21,405
21,405

21,405

21,405

19,614
19,614

19,614

19,614

25,938
25,938

25,938

25,938

—
—

—

—

(735)
(735)

(735)

(735)

65,894
65,894

65,894

65,894

40,113
40,113

40,113

40,113

34,442
34,442

34,442

34,442

Less: income tax benefit  (1)
Less: income tax benefit  (1)

Less: income tax benefit  (1)
Less: income tax benefit  (1)

12,153
12,153

12,153

12,153

8,277
8,277

8,277

8,277

7,407
7,407

7,407

7,407

Net share-based compensation expense
Net share-based compensation expense

Net share-based compensation expense

Net share-based compensation expense

$ 53,741
$ 53,741

$ 53,741

$ 53,741

$ 31,836
$ 31,836

$ 31,836

$ 31,836

$ 27,035
$ 27,035

$ 27,035

$ 27,035

(1) Does not include the excess tax benefit realized for the tax deductions of the share-based payment arrangements which
(1) Does not include the excess tax benefit realized for the tax deductions of the share-based payment arrangements which
totaled $4.0 million, $4.7 million and $5.2 million, respectively, for the years ended December 31, 2019, 2018 and 2017.
totaled $4.0 million, $4.7 million and $5.2 million, respectively, for the years ended December 31, 2019, 2018 and
2017.

(1) Does not include the excess tax benefit realized for the tax deductions of the share-based payment arrangements which
(1) Does not include the excess tax benefit realized for the tax deductions of the share-based payment arrangements which
totaled $4.0 million, $4.7 million and $5.2 million, respectively, for the years ended December 31, 2019, 2018 and
totaled $4.0 million, $4.7 million and $5.2 million, respectively, for the years ended December 31, 2019, 2018 and
2017.
2017.

Share-based compensation expense includes amounts related to the restructuring programs discussed in Note 6
Share-based compensation expense includes amounts related to the restructuring programs discussed in Note 6
"Restructuring and Impairment", including accelerated expense in 2019 and net forfeitures in 2017. No share-based
"Restructuring and Impairment", including accelerated expense in 2019 and net forfeitures in 2017. No share-based
compensation costs were capitalized for the years ended December 31, 2019, 2018 or 2017 as the amounts were
202
compensation costs were capitalized for the years ended December 31, 2019, 2018 or 2017 as the amounts were
not material.
not material.

Share-based compensation expense includes amounts related to the restructuring programs discussed in Note 6
Share-based compensation expense includes amounts related to the restructuring programs discussed in Note 6
"Restructuring and Impairment", including accelerated expense in 2019 and net forfeitures in 2017. No share-based
"Restructuring and Impairment", including accelerated expense in 2019 and net forfeitures in 2017. No share-based
compensation costs were capitalized for the years ended December 31, 2019, 2018 or 2017 as the amounts were
compensation costs were capitalized for the years ended December 31, 2019, 2018 or 2017 as the amounts were
not material.
not material.

23. Employee Benefits

23. Employee Benefits

23. Employee Benefits

23. Employee Benefits

We maintain various benefit plans, including defined contribution and defined benefit plans. Our U.S. defined

We maintain various benefit plans, including defined contribution and defined benefit plans. Our U.S. defined

We maintain various benefit plans, including defined contribution and defined benefit plans. Our U.S. defined

We maintain various benefit plans, including defined contribution and defined benefit plans. Our U.S. defined

contribution plan is qualified under Section 401(k) of the Internal Revenue Code, and covers substantially all U.S.

contribution plan is qualified under Section 401(k) of the Internal Revenue Code, and covers substantially all U.S.

contribution plan is qualified under Section 401(k) of the Internal Revenue Code, and covers substantially all U.S.

contribution plan is qualified under Section 401(k) of the Internal Revenue Code, and covers substantially all U.S.

employees. Participants may contribute a portion of their compensation not exceeding a limit set annually by the

employees. Participants may contribute a portion of their compensation not exceeding a limit set annually by the

employees. Participants may contribute a portion of their compensation not exceeding a limit set annually by the

employees. Participants may contribute a portion of their compensation not exceeding a limit set annually by the

Internal Revenue Service. This plan includes a provision for us to match a portion of employee contributions. Total

Internal Revenue Service. This plan includes a provision for us to match a portion of employee contributions. Total

Internal Revenue Service. This plan includes a provision for us to match a portion of employee contributions. Total

Internal Revenue Service. This plan includes a provision for us to match a portion of employee contributions. Total

expense under the 401(k) plans, including the plans acquired via business acquisitions, was $4.0 million, $4.0

expense under the 401(k) plans, including the plans acquired via business acquisitions, was $4.0 million, $4.0

expense under the 401(k) plans, including the plans acquired via business acquisitions, was $4.0 million, $4.0

expense under the 401(k) plans, including the plans acquired via business acquisitions, was $4.0 million, $4.0

million and $3.6 million for the years ended December 31, 2019, 2018 and 2017, respectively. We also have a

million and $3.6 million for the years ended December 31, 2019, 2018 and 2017, respectively. We also have a

million and $3.6 million for the years ended December 31, 2019, 2018 and 2017, respectively. We also have a

million and $3.6 million for the years ended December 31, 2019, 2018 and 2017, respectively. We also have a

defined contribution plan which covers certain executives. We make matching contributions up to an established

defined contribution plan which covers certain executives. We make matching contributions up to an established

defined contribution plan which covers certain executives. We make matching contributions up to an established

defined contribution plan which covers certain executives. We make matching contributions up to an established

maximum. Matching contributions made to the plan, and expensed, totaled approximately $0.2 million, $0.2 million

maximum. Matching contributions made to the plan, and expensed, totaled approximately $0.2 million, $0.2 million

maximum. Matching contributions made to the plan, and expensed, totaled approximately $0.2 million, $0.2 million

maximum. Matching contributions made to the plan, and expensed, totaled approximately $0.2 million, $0.2 million

and $0.3 million in each year ended December 31, 2019, 2018 and 2017, respectively.

and $0.3 million in each year ended December 31, 2019, 2018 and 2017, respectively.

and $0.3 million in each year ended December 31, 2019, 2018 and 2017, respectively.

and $0.3 million in each year ended December 31, 2019, 2018 and 2017, respectively.

We have five defined benefit, non-contributory retirement or termination plans that cover certain employees in

We have five defined benefit, non-contributory retirement or termination plans that cover certain employees in

We have five defined benefit, non-contributory retirement or termination plans that cover certain employees in

We have five defined benefit, non-contributory retirement or termination plans that cover certain employees in

Germany, France, Japan, Italy and the United Arab Emirates. These defined benefit plans provide benefits to

Germany, France, Japan, Italy and the United Arab Emirates. These defined benefit plans provide benefits to

Germany, France, Japan, Italy and the United Arab Emirates. These defined benefit plans provide benefits to

Germany, France, Japan, Italy and the United Arab Emirates. These defined benefit plans provide benefits to

covered individuals satisfying certain age and/or service requirements. For certain plans, we calculate the vested

covered individuals satisfying certain age and/or service requirements. For certain plans, we calculate the vested

covered individuals satisfying certain age and/or service requirements. For certain plans, we calculate the vested

covered individuals satisfying certain age and/or service requirements. For certain plans, we calculate the vested

benefits to which employees are entitled if they separate immediately. The benefits accrued on a pro-rata basis

benefits to which employees are entitled if they separate immediately. The benefits accrued on a pro-rata basis

benefits to which employees are entitled if they separate immediately. The benefits accrued on a pro-rata basis

benefits to which employees are entitled if they separate immediately. The benefits accrued on a pro-rata basis

during the employees’ employment period are based on the individuals’ salaries, adjusted for inflation. The liability

during the employees’ employment period are based on the individuals’ salaries, adjusted for inflation. The liability

during the employees’ employment period are based on the individuals’ salaries, adjusted for inflation. The liability

during the employees’ employment period are based on the individuals’ salaries, adjusted for inflation. The liability

under the defined benefit plans was $8.2 million at December 31, 2019 and $7.4 million at December 31, 2018,

under the defined benefit plans was $8.2 million at December 31, 2019 and $7.4 million at December 31, 2018,

under the defined benefit plans was $8.2 million at December 31, 2019 and $7.4 million at December 31, 2018,

under the defined benefit plans was $8.2 million at December 31, 2019 and $7.4 million at December 31, 2018,

and is included as a component of other long-term liabilities on the accompanying consolidated balance sheets.

and is included as a component of other long-term liabilities on the accompanying consolidated balance sheets.

and is included as a component of other long-term liabilities on the accompanying consolidated balance sheets.

and is included as a component of other long-term liabilities on the accompanying consolidated balance sheets.

24. Related Party Transactions

24. Related Party Transactions

24. Related Party Transactions

24. Related Party Transactions

From time to time, we have transactions with other companies in which we hold an interest, all of which are

From time to time, we have transactions with other companies in which we hold an interest, all of which are

From time to time, we have transactions with other companies in which we hold an interest, all of which are

From time to time, we have transactions with other companies in which we hold an interest, all of which are

individually and in the aggregate immaterial, as summarized in the table below.

individually and in the aggregate immaterial, as summarized in the table below.

individually and in the aggregate immaterial, as summarized in the table below.

individually and in the aggregate immaterial, as summarized in the table below.

Net sales

Net sales

Net sales

Net sales

$ 20,002

$ 23,358

$ 3,852

$ 20,002

$ 20,002

$ 20,002

$ 23,358

$ 23,358

$ 23,358

$ 3,852

$ 3,852

$ 3,852

Net sales with related parties primarily reflects our ventures in China including our partnership to externalize the HPV

Net sales with related parties primarily reflects our ventures in China including our partnership to externalize the HPV

Net sales with related parties primarily reflects our ventures in China including our partnership to externalize the HPV

Net sales with related parties primarily reflects our ventures in China including our partnership to externalize the HPV

test franchise for cervical cancer screening in China as well as our joint venture with Sichuan Maccura Biotechnology

test franchise for cervical cancer screening in China as well as our joint venture with Sichuan Maccura Biotechnology

test franchise for cervical cancer screening in China as well as our joint venture with Sichuan Maccura Biotechnology

test franchise for cervical cancer screening in China as well as our joint venture with Sichuan Maccura Biotechnology

Stock UnitsCompensation ExpenseAll Employee OptionsNumber of Shares(in thousands)Weighted AverageExercise PriceWeighted AverageContractual Term (in years)Aggregate IntrinsicValue (in thousands)Stock UnitsStock Units (in thousands)Weighted AverageContractual Term (inyears)Aggregate IntrinsicValue (in thousands)Compensation Expense (in thousands)201920182017(in thousands)For the years ended December 31,201920182017Compensation Expense (in thousands)201920182017(in thousands)For the years ended December 31,201920182017Compensation Expense (in thousands)201920182017(in thousands)For the years ended December 31,201920182017Compensation Expense (in thousands)201920182017(in thousands)For the years ended December 31,201920182017Cost of sales

Cost of sales

Cost of sales

Cost of sales

Research and development

Research and development

Research and development

Research and development

Sales and marketing

Sales and marketing

Sales and marketing

Sales and marketing

General and administrative

General and administrative

General and administrative

General and administrative

Restructuring, acquisition, integration and other, net

Restructuring, acquisition, integration and other, net

Restructuring, acquisition, integration and other, net

$ 2,493

$ 2,493

$ 2,493

$ 2,879

$ 2,879

$ 2,879

$ 2,641

$ 2,641

$ 2,641

$ 2,493

5,810

5,810

7,947

7,947

23,706

23,706

25,938

5,810

5,810

7,947

7,947

23,706

23,706

25,938

25,938

$ 2,879

6,457

6,457

9,372

9,372

21,405

21,405

—

6,457

6,457

9,372

9,372

21,405

21,405

—

—

$ 2,641

6,102

6,102

6,820

6,820

19,614

19,614

(735)

6,102

6,102

6,820

6,820

19,614

19,614

(735)

(735)

Less: income tax benefit  (1)
Less: income tax benefit  (1)

Share-based compensation expense
Share-based compensation expense

F I N A N C I A L   R E S U LT S Notes to consolidated financial statements

Restructuring, acquisition, integration and other, net
(735)
Share-based compensation expense
34,442
Share-based compensation expense
34,442
Less: income tax benefit  (1)
7,407
Less: income tax benefit  (1)
7,407
Net share-based compensation expense
$ 27,035
Net share-based compensation expense
$ 27,035
(1) Does not include the excess tax benefit realized for the tax deductions of the share-based payment arrangements which
totaled $4.0 million, $4.7 million and $5.2 million, respectively, for the years ended December 31, 2019, 2018 and
(1) Does not include the excess tax benefit realized for the tax deductions of the share-based payment arrangements which
2017.
totaled $4.0 million, $4.7 million and $5.2 million, respectively, for the years ended December 31, 2019, 2018 and 2017.

25,938
65,894
65,894
12,153
12,153
$ 53,741
$ 53,741
(1) Does not include the excess tax benefit realized for the tax deductions of the share-based payment arrangements which
(1) Does not include the excess tax benefit realized for the tax deductions of the share-based payment arrangements which
totaled $4.0 million, $4.7 million and $5.2 million, respectively, for the years ended December 31, 2019, 2018 and
totaled $4.0 million, $4.7 million and $5.2 million, respectively, for the years ended December 31, 2019, 2018 and
2017.
2017.

—
40,113
40,113
8,277
8,277
$ 31,836
$ 31,836

Net share-based compensation expense
Net share-based compensation expense

$ 31,836
$ 31,836

$ 53,741
$ 53,741

12,153
12,153

65,894
65,894

40,113
40,113

8,277
8,277

$ 27,035
$ 27,035

34,442
34,442

7,407
7,407

Share-based compensation expense includes amounts related to the restructuring programs discussed in Note 6
Share-based compensation expense includes amounts related to the restructuring programs discussed in Note 6
"Restructuring and Impairment", including accelerated expense in 2019 and net forfeitures in 2017. No share-based
"Restructuring and Impairment", including accelerated expense in 2019 and net forfeitures in 2017. No share-based
compensation costs were capitalized for the years ended December 31, 2019, 2018 or 2017 as the amounts were
compensation costs were capitalized for the years ended December 31, 2019, 2018 or 2017 as the amounts were
not material.
not material.

Share-based compensation expense includes amounts related to the restructuring programs discussed in Note 6
Share-based compensation expense includes amounts related to the restructuring programs discussed in Note 6
"Restructuring and Impairment", including accelerated expense in 2019 and net forfeitures in 2017. No share-based
"Restructuring and Impairment", including accelerated expense in 2019 and net forfeitures in 2017. No share-based
compensation costs were capitalized for the years ended December 31, 2019, 2018 or 2017 as the amounts were
compensation costs were capitalized for the years ended December 31, 2019, 2018 or 2017 as the amounts were
not material.
not material.

23. Employee Benefits
23. Employee Benefits

23. Employee Benefits
23. Employee Benefits

We maintain various benefit plans, including defined contribution and defined benefit plans. Our U.S. defined
We maintain various benefit plans, including defined contribution and defined benefit plans. Our U.S. defined
contribution plan is qualified under Section 401(k) of the Internal Revenue Code, and covers substantially all U.S.
contribution plan is qualified under Section 401(k) of the Internal Revenue Code, and covers substantially all U.S.
employees. Participants may contribute a portion of their compensation not exceeding a limit set annually by the
employees. Participants may contribute a portion of their compensation not exceeding a limit set annually by the
Internal Revenue Service. This plan includes a provision for us to match a portion of employee contributions. Total
Internal Revenue Service. This plan includes a provision for us to match a portion of employee contributions. Total
expense under the 401(k) plans, including the plans acquired via business acquisitions, was $4.0 million, $4.0
expense under the 401(k) plans, including the plans acquired via business acquisitions, was $4.0 million, $4.0
million and $3.6 million for the years ended December 31, 2019, 2018 and 2017, respectively. We also have a
million and $3.6 million for the years ended December 31, 2019, 2018 and 2017, respectively. We also have a
defined contribution plan which covers certain executives. We make matching contributions up to an established
defined contribution plan which covers certain executives. We make matching contributions up to an established
maximum. Matching contributions made to the plan, and expensed, totaled approximately $0.2 million, $0.2 million
maximum. Matching contributions made to the plan, and expensed, totaled approximately $0.2 million, $0.2 million
and $0.3 million in each year ended December 31, 2019, 2018 and 2017, respectively.
and $0.3 million in each year ended December 31, 2019, 2018 and 2017, respectively.

We maintain various benefit plans, including defined contribution and defined benefit plans. Our U.S. defined
We maintain various benefit plans, including defined contribution and defined benefit plans. Our U.S. defined
contribution plan is qualified under Section 401(k) of the Internal Revenue Code, and covers substantially all U.S.
contribution plan is qualified under Section 401(k) of the Internal Revenue Code, and covers substantially all U.S.
employees. Participants may contribute a portion of their compensation not exceeding a limit set annually by the
employees. Participants may contribute a portion of their compensation not exceeding a limit set annually by the
Internal Revenue Service. This plan includes a provision for us to match a portion of employee contributions. Total
Internal Revenue Service. This plan includes a provision for us to match a portion of employee contributions. Total
expense under the 401(k) plans, including the plans acquired via business acquisitions, was $4.0 million, $4.0
expense under the 401(k) plans, including the plans acquired via business acquisitions, was $4.0 million, $4.0
million and $3.6 million for the years ended December 31, 2019, 2018 and 2017, respectively. We also have a
million and $3.6 million for the years ended December 31, 2019, 2018 and 2017, respectively. We also have a
defined contribution plan which covers certain executives. We make matching contributions up to an established
defined contribution plan which covers certain executives. We make matching contributions up to an established
maximum. Matching contributions made to the plan, and expensed, totaled approximately $0.2 million, $0.2 million
maximum. Matching contributions made to the plan, and expensed, totaled approximately $0.2 million, $0.2 million
and $0.3 million in each year ended December 31, 2019, 2018 and 2017, respectively.
and $0.3 million in each year ended December 31, 2019, 2018 and 2017, respectively.

We have five defined benefit, non-contributory retirement or termination plans that cover certain employees in
We have five defined benefit, non-contributory retirement or termination plans that cover certain employees in
Germany, France, Japan, Italy and the United Arab Emirates. These defined benefit plans provide benefits to
Germany, France, Japan, Italy and the United Arab Emirates. These defined benefit plans provide benefits to
covered individuals satisfying certain age and/or service requirements. For certain plans, we calculate the vested
covered individuals satisfying certain age and/or service requirements. For certain plans, we calculate the vested
benefits to which employees are entitled if they separate immediately. The benefits accrued on a pro-rata basis
benefits to which employees are entitled if they separate immediately. The benefits accrued on a pro-rata basis
during the employees’ employment period are based on the individuals’ salaries, adjusted for inflation. The liability
during the employees’ employment period are based on the individuals’ salaries, adjusted for inflation. The liability
under the defined benefit plans was $8.2 million at December 31, 2019 and $7.4 million at December 31, 2018,
under the defined benefit plans was $8.2 million at December 31, 2019 and $7.4 million at December 31, 2018,
and is included as a component of other long-term liabilities on the accompanying consolidated balance sheets.
and is included as a component of other long-term liabilities on the accompanying consolidated balance sheets.

We have five defined benefit, non-contributory retirement or termination plans that cover certain employees in
We have five defined benefit, non-contributory retirement or termination plans that cover certain employees in
Germany, France, Japan, Italy and the United Arab Emirates. These defined benefit plans provide benefits to
Germany, France, Japan, Italy and the United Arab Emirates. These defined benefit plans provide benefits to
covered individuals satisfying certain age and/or service requirements. For certain plans, we calculate the vested
covered individuals satisfying certain age and/or service requirements. For certain plans, we calculate the vested
benefits to which employees are entitled if they separate immediately. The benefits accrued on a pro-rata basis
benefits to which employees are entitled if they separate immediately. The benefits accrued on a pro-rata basis
during the employees’ employment period are based on the individuals’ salaries, adjusted for inflation. The liability
during the employees’ employment period are based on the individuals’ salaries, adjusted for inflation. The liability
under the defined benefit plans was $8.2 million at December 31, 2019 and $7.4 million at December 31, 2018,
under the defined benefit plans was $8.2 million at December 31, 2019 and $7.4 million at December 31, 2018,
and is included as a component of other long-term liabilities on the accompanying consolidated balance sheets.
and is included as a component of other long-term liabilities on the accompanying consolidated balance sheets.

24. Related Party Transactions
24. Related Party Transactions

24. Related Party Transactions
24. Related Party Transactions

From time to time, we have transactions with other companies in which we hold an interest, all of which are
From time to time, we have transactions with other companies in which we hold an interest, all of which are
individually and in the aggregate immaterial, as summarized in the table below.
individually and in the aggregate immaterial, as summarized in the table below.

From time to time, we have transactions with other companies in which we hold an interest, all of which are
From time to time, we have transactions with other companies in which we hold an interest, all of which are
individually and in the aggregate immaterial, as summarized in the table below.
individually and in the aggregate immaterial, as summarized in the table below.

Net sales
Net sales

Net sales
Net sales

$ 20,002
$ 20,002

$ 20,002
$ 20,002

$ 23,358
$ 23,358

$ 23,358
$ 23,358

$ 3,852
$ 3,852

$ 3,852
$ 3,852

Net sales with related parties primarily reflects our ventures in China including our partnership to externalize the HPV
Net sales with related parties primarily reflects our ventures in China including our partnership to externalize the HPV
test franchise for cervical cancer screening in China as well as our joint venture with Sichuan Maccura Biotechnology
test franchise for cervical cancer screening in China as well as our joint venture with Sichuan Maccura Biotechnology

Net sales with related parties primarily reflects our ventures in China including our partnership to externalize the HPV
Net sales with related parties primarily reflects our ventures in China including our partnership to externalize the HPV
test franchise for cervical cancer screening in China as well as our joint venture with Sichuan Maccura Biotechnology
test franchise for cervical cancer screening in China as well as our joint venture with Sichuan Maccura Biotechnology
Co., Ltd which was terminated in conjunction with the 2019 restructuring activities discussed further in Note 6
"Restructuring and Impairments" which also details related party restructuring charges.

Accounts receivable

Prepaid expenses and other current assets

Other long-term assets

Accounts payable

Accrued and other current liabilities

$ 7,589

$ 13,697

$ 16,830

$ 1,775

$ 15,404

$ 10,109

$ 3,873

$ 24,300

$ 4,888

$ 5,488

Prepaid expenses and other current assets include short-term loan receivables and supplier advances from companies
203
with which we have an investment or partnership interest.

In connection with the 2019 Restructuring further discussed in Note 6 "Restructuring and Impairments", we entered

into a agreement with a non-publicly traded company considered a related party to reduce future purchase

commitments to $25.2 million through 2022. The commitment was reduced by $12.8 million which will be paid in

2020 and is included in accrued and other current liabilities as of December 31, 2019 in the accompanying

consolidated balance sheet.

During 2018, we purchased a convertible note for $15.0 million from a privately held company. The note is due in

December 2021 and bears interest at 8%. In the event the company goes public, the note will convert into common

shares in the company ranking pari-passu with existing common shares. As of December 31, 2019, the principal

and accrued interest of this note totals $16.3 million and is included in other long-term assets.

Compensation Expense (in thousands)201920182017(in thousands)For the years ended December 31,201920182017(in thousands)As of December 31,20192018Compensation Expense (in thousands)201920182017(in thousands)For the years ended December 31,201920182017Compensation Expense (in thousands)201920182017(in thousands)For the years ended December 31,201920182017Compensation Expense (in thousands)201920182017(in thousands)For the years ended December 31,201920182017Co., Ltd which was terminated in conjunction with the 2019 restructuring activities discussed further in Note 6
Co., Ltd which was terminated in conjunction with the 2019 restructuring activities discussed further in Note 6
"Restructuring and Impairments" which also details related party restructuring charges.
"Restructuring and Impairments" which also details related party restructuring charges.

Co., Ltd which was terminated in conjunction with the 2019 restructuring activities discussed further in Note 6
Co., Ltd which was terminated in conjunction with the 2019 restructuring activities discussed further in Note 6
"Restructuring and Impairments" which also details related party restructuring charges.
"Restructuring and Impairments" which also details related party restructuring charges.

Accounts receivable
Accounts receivable

Accounts receivable
Accounts receivable

$ 7,589
$ 7,589

$ 7,589
$ 7,589

$ 10,109
$ 10,109

$ 10,109
$ 10,109

Prepaid expenses and other current assets
Prepaid expenses and other current assets

Prepaid expenses and other current assets
Prepaid expenses and other current assets

$ 13,697
$ 13,697

$ 13,697
$ 13,697

$ 3,873
$ 3,873

$ 3,873
$ 3,873

Other long-term assets
Other long-term assets

Other long-term assets
Other long-term assets

Accounts payable
Accounts payable

Accounts payable
Accounts payable

$ 16,830
$ 16,830

$ 16,830
$ 16,830

$ 24,300
$ 24,300

$ 24,300
$ 24,300

$ 1,775
$ 1,775

$ 1,775
$ 1,775

$ 4,888
$ 4,888

$ 4,888
$ 4,888

Accrued and other current liabilities
Accrued and other current liabilities

Accrued and other current liabilities
Accrued and other current liabilities

$ 15,404
$ 15,404

$ 15,404
$ 15,404

$ 5,488
$ 5,488

$ 5,488
$ 5,488

Prepaid expenses and other current assets include short-term loan receivables and supplier advances from companies
Prepaid expenses and other current assets include short-term loan receivables and supplier advances from companies
with which we have an investment or partnership interest.
with which we have an investment or partnership interest.

Prepaid expenses and other current assets include short-term loan receivables and supplier advances from companies
Prepaid expenses and other current assets include short-term loan receivables and supplier advances from companies
with which we have an investment or partnership interest.
with which we have an investment or partnership interest.

In connection with the 2019 Restructuring further discussed in Note 6 "Restructuring and Impairments", we entered
In connection with the 2019 Restructuring further discussed in Note 6 "Restructuring and Impairments", we entered
In connection with the 2019 Restructuring further discussed in Note 6 "Restructuring and Impairments", we entered
In connection with the 2019 Restructuring further discussed in Note 6 "Restructuring and Impairments", we entered
into a agreement with a non-publicly traded company considered a related party to reduce future purchase
into a agreement with a non-publicly traded company considered a related party to reduce future purchase
into a agreement with a non-publicly traded company considered a related party to reduce future purchase
into a agreement with a non-publicly traded company considered a related party to reduce future purchase
commitments to $25.2 million through 2022. The commitment was reduced by $12.8 million which will be paid in
commitments to $25.2 million through 2022. The commitment was reduced by $12.8 million which will be paid in
commitments to $25.2 million through 2022. The commitment was reduced by $12.8 million which will be paid in
commitments to $25.2 million through 2022. The commitment was reduced by $12.8 million which will be paid in
2020 and is included in accrued and other current liabilities as of December 31, 2019 in the accompanying
2020 and is included in accrued and other current liabilities as of December 31, 2019 in the accompanying
2020 and is included in accrued and other current liabilities as of December 31, 2019 in the accompanying
2020 and is included in accrued and other current liabilities as of December 31, 2019 in the accompanying
consolidated balance sheet.
consolidated balance sheet.
consolidated balance sheet.
consolidated balance sheet.

During 2018, we purchased a convertible note for $15.0 million from a privately held company. The note is due in
During 2018, we purchased a convertible note for $15.0 million from a privately held company. The note is due in
During 2018, we purchased a convertible note for $15.0 million from a privately held company. The note is due in
During 2018, we purchased a convertible note for $15.0 million from a privately held company. The note is due in
December 2021 and bears interest at 8%. In the event the company goes public, the note will convert into common
December 2021 and bears interest at 8%. In the event the company goes public, the note will convert into common
December 2021 and bears interest at 8%. In the event the company goes public, the note will convert into common
December 2021 and bears interest at 8%. In the event the company goes public, the note will convert into common
shares in the company ranking pari-passu with existing common shares. As of December 31, 2019, the principal
shares in the company ranking pari-passu with existing common shares. As of December 31, 2019, the principal
shares in the company ranking pari-passu with existing common shares. As of December 31, 2019, the principal
shares in the company ranking pari-passu with existing common shares. As of December 31, 2019, the principal
and accrued interest of this note totals $16.3 million and is included in other long-term assets.
and accrued interest of this note totals $16.3 million and is included in other long-term assets.
and accrued interest of this note totals $16.3 million and is included in other long-term assets.
and accrued interest of this note totals $16.3 million and is included in other long-term assets.

204

(in thousands)As of December 31,20192018(in thousands)As of December 31,20192018(in thousands)As of December 31,20192018(in thousands)As of December 31,20192018F I N A N C I A L   R E S U LT S Notes to consolidated financial statements

205

Financial Results
Financial Results

Auditor’s Report
Auditor’s Report

Report of independent registered public accounting firm
Report of Independent Registered Public Accounting Firm

To the Shareholders and Supervisory Board
To the Shareholders and Supervisory Board

QIAGEN N.V.:
QIAGEN N.V.:

We have audited the accompanying consolidated balance sheets of QIAGEN N.V. and subsidiaries (the
We have audited the accompanying consolidated balance sheets of QIAGEN N.V. and subsidiaries (the
“Company”) as of December 31, 2019 and 2018, the related consolidated statements of (loss) income,
“Company”) as of December 31, 2019 and 2018, the related consolidated statements of (loss) income,
comprehensive (loss) income, changes in equity, and cash flows for each of the years in the three-year period ended
comprehensive (loss) income, changes in equity, and cash flows for each of the years in the three-year period ended
December 31, 2019, and the related notes and financial statement schedule as listed in Item 18 (A) (collectively, the
December 31, 2019, and the related notes and financial statement schedule as listed in Item 18 (A) (collectively, the
consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material
consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material
respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its
respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its
operations and its cash flows for each of the years in the three-year period ended December 31, 2019, in conformity
operations and its cash flows for each of the years in the three-year period ended December 31, 2019, in conformity
with U.S. generally accepted accounting principles.
with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2019, based on
States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2019, based on
criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring
criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring
Organizations of the Treadway Commission, and our report dated February 28, 2020 expressed an unqualified
Organizations of the Treadway Commission, and our report dated February 28, 2020 expressed an unqualified
opinion on the effectiveness of the Company’s internal control over financial reporting.
opinion on the effectiveness of the Company’s internal control over financial reporting.

As discussed in Note 2 to the consolidated financial statements, the Company has changed its method of accounting
As discussed in Note 2 to the consolidated financial statements, the Company has changed its method of accounting
for leases in 2019 due to the adoption of Accounting Standards Codification Topic 842 - Leases. In 2018, the
for leases in 2019 due to the adoption of Accounting Standards Codification Topic 842 - Leases. In 2018, the
Company has changed its method of accounting for revenue from contracts with customers due to the adoption of
Company has changed its method of accounting for revenue from contracts with customers due to the adoption of
Accounting Standards Codification Topic 606 - Revenue from Contracts with Customers.
Accounting Standards Codification Topic 606 - Revenue from Contracts with Customers.

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to
express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm
express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm
registered with the PCAOB and are required to be independent with respect to the Company in accordance with the
registered with the PCAOB and are required to be independent with respect to the Company in accordance with the
U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and
U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and
the PCAOB.
the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of
perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of
material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks
material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks
of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing
of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing
procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the
procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the
amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting
amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting

206

Opinion on the Consolidated Financial StatementsChange in Accounting PrincipleBasis for OpinionOpinion on the Consolidated Financial StatementsChange in Accounting PrincipleBasis for OpinionFinancial Results

Auditor’s Report

Report of Independent Registered Public Accounting Firm

To the Shareholders and Supervisory Board

QIAGEN N.V.:

We have audited the accompanying consolidated balance sheets of QIAGEN N.V. and subsidiaries (the

“Company”) as of December 31, 2019 and 2018, the related consolidated statements of (loss) income,

comprehensive (loss) income, changes in equity, and cash flows for each of the years in the three-year period ended

December 31, 2019, and the related notes and financial statement schedule as listed in Item 18 (A) (collectively, the

consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material

respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its

operations and its cash flows for each of the years in the three-year period ended December 31, 2019, in conformity

with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United

States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2019, based on

criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring

Organizations of the Treadway Commission, and our report dated February 28, 2020 expressed an unqualified

opinion on the effectiveness of the Company’s internal control over financial reporting.

As discussed in Note 2 to the consolidated financial statements, the Company has changed its method of accounting

for leases in 2019 due to the adoption of Accounting Standards Codification Topic 842 - Leases. In 2018, the

Company has changed its method of accounting for revenue from contracts with customers due to the adoption of

Accounting Standards Codification Topic 606 - Revenue from Contracts with Customers.

F I N A N C I A L   R E S U LT S

Auditor’s Report

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to
express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm
registered with the PCAOB and are required to be independent with respect to the Company in accordance with the
U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and
the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of
material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks
of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing
procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the
amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting
principles used and significant estimates made by management, as well as evaluating the overall presentation of the
consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

The critical audit matters communicated below are matters arising from the current period audit of the consolidated
financial statements that were communicated or required to be communicated to the audit committee and that: (1)
relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our
especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter
in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by
communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the
accounts or disclosures to which they relate.

As discussed in Notes 3 and 6 to the consolidated financial statements, the Company performs impairment testing for
its long-lived assets whenever events or changes in circumstances indicate that the carrying value of an asset or a
group of assets may not be recoverable and exceeds its fair value. In the second half of 2019, the Company began
a restructuring initiative as a result of the suspended development of the NGS-related instrument systems. Due to the
restructuring initiative, the Company fully impaired certain long-lived assets, based on the Company’s assumption
that these assets had no alternative use. The Company estimated that no value was recoverable in a market disposal
and recorded impairment expenses related to the certain long-lived assets during the year ended December 31,
2019 of $138.8 million.

We identified the evaluation of the impairment analysis for certain long-lived assets associated with the restructuring
initiative as a critical audit matter due to a high degree of complex auditor judgment in evaluating the Company’s
assumption of related alternative uses.

The primary procedures we performed to address this critical audit matter included the following. We tested certain
internal controls over the Company’s impairment assessment process for long-lived assets, including the control
related to the assessment of alternative highest and best uses for these assets. For a selection of assets within the
long-lived asset group, we evaluated the Company’s conclusion over their alternative uses through a combination of
(1) inspecting application descriptions and uses in underlying license agreements, software documentation and other
contracts, (2) inquiring with operational management and performing independent research into patents’ and other
intangible assets’ potential uses outside of the Company’s other product areas, and, (3) considering the collective
results of the procedures performed to assess the sufficiency of the audit evidence obtained related to the Company
recording a full impairment charge.

As discussed in Notes 5 and 11 to the consolidated financial statements, on January 31, 2019, the Company
acquired the digital PCR asset of Formulatrix Inc. (Formulatrix) in an asset acquisition. Consistent with other business
combination type transactions, the Company determines whether an acquired entity is considered to be a business,
or an asset or group of assets, including whether substantially all of the fair value of the acquired gross assets is
concentrated in a single asset or group of similarly identifiable assets. The purchase price of the digital PCR asset,
determined as the acquired asset in the Formulatrix acquisition, was $260.9 million, of which $125.0 million was
paid upon closing.

We identified the evaluation of the Formulatrix asset purchase transaction as an asset acquisition as a critical audit
matter. Complex auditor judgment and specialized skills were required to assess the Company’s determination that

207

substantially all of the fair value of the Formulatrix assets acquired was concentrated in a single identifiable asset or

group of similar identifiable assets.

The primary procedures we performed to address this critical audit matter included the following. We tested certain

internal controls over the Company’s acquisition-date evaluation process including controls to (1) identify assets

acquired and (2) assess the application of the substantially all threshold in determining the asset acquisition criterion

is met. We inspected the Formulatrix asset purchase agreement, including the transaction terms and specific assets

Opinion on the Consolidated Financial StatementsChange in Accounting PrincipleBasis for OpinionCritical Audit MattersEvaluation of certain long-lived asset impairmentsEvaluation of the Formulatrix asset purchase agreement as an asset acquisitionprinciples used and significant estimates made by management, as well as evaluating the overall presentation of the

consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

The critical audit matters communicated below are matters arising from the current period audit of the consolidated

financial statements that were communicated or required to be communicated to the audit committee and that: (1)

relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our

especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter

in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by

communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the

accounts or disclosures to which they relate.

As discussed in Notes 3 and 6 to the consolidated financial statements, the Company performs impairment testing for

its long-lived assets whenever events or changes in circumstances indicate that the carrying value of an asset or a

group of assets may not be recoverable and exceeds its fair value. In the second half of 2019, the Company began

a restructuring initiative as a result of the suspended development of the NGS-related instrument systems. Due to the

restructuring initiative, the Company fully impaired certain long-lived assets, based on the Company’s assumption

that these assets had no alternative use. The Company estimated that no value was recoverable in a market disposal

and recorded impairment expenses related to the certain long-lived assets during the year ended December 31,

2019 of $138.8 million.

We identified the evaluation of the impairment analysis for certain long-lived assets associated with the restructuring

initiative as a critical audit matter due to a high degree of complex auditor judgment in evaluating the Company’s

assumption of related alternative uses.

The primary procedures we performed to address this critical audit matter included the following. We tested certain

internal controls over the Company’s impairment assessment process for long-lived assets, including the control

related to the assessment of alternative highest and best uses for these assets. For a selection of assets within the
long-lived asset group, we evaluated the Company’s conclusion over their alternative uses through a combination of
(1) inspecting application descriptions and uses in underlying license agreements, software documentation and other
contracts, (2) inquiring with operational management and performing independent research into patents’ and other
intangible assets’ potential uses outside of the Company’s other product areas, and, (3) considering the collective
results of the procedures performed to assess the sufficiency of the audit evidence obtained related to the Company
recording a full impairment charge.

As discussed in Notes 5 and 11 to the consolidated financial statements, on January 31, 2019, the Company
acquired the digital PCR asset of Formulatrix Inc. (Formulatrix) in an asset acquisition. Consistent with other business
combination type transactions, the Company determines whether an acquired entity is considered to be a business,
or an asset or group of assets, including whether substantially all of the fair value of the acquired gross assets is
concentrated in a single asset or group of similarly identifiable assets. The purchase price of the digital PCR asset,
determined as the acquired asset in the Formulatrix acquisition, was $260.9 million, of which $125.0 million was
paid upon closing.

We identified the evaluation of the Formulatrix asset purchase transaction as an asset acquisition as a critical audit
matter. Complex auditor judgment and specialized skills were required to assess the Company’s determination that
substantially all of the fair value of the Formulatrix assets acquired was concentrated in a single identifiable asset or
group of similar identifiable assets.

The primary procedures we performed to address this critical audit matter included the following. We tested certain
internal controls over the Company’s acquisition-date evaluation process including controls to (1) identify assets
acquired and (2) assess the application of the substantially all threshold in determining the asset acquisition criterion
is met. We inspected the Formulatrix asset purchase agreement, including the transaction terms and specific assets
listed in the agreement, to evaluate the Company’s identification of assets acquired. We evaluated the Company’s
assessment that substantially all the fair value of the assets acquired was concentrated in a single identifiable asset or
group of similar identifiable assets by inspecting the nature of these assets and comparisons to external cost and
external market research studies to assess for indications of dissimilar characteristics. In addition, we involved
valuation professionals with specialized skills and knowledge, who assisted in:

›

›

evaluating the identification of the intangible assets acquired from the Formulatrix asset purchase transaction by
inspecting and evaluating legal terms that would give rise to identifiable intangible assets; and

assessing the Company’s determination of combining the Formulatrix intangible assets into a single developed
technology intangible asset.

As discussed in Note 17 to the consolidated financial statements, the Company conducts its business globally and
operates more than 50 consolidated subsidiaries in multiple tax jurisdictions. This multi-jurisdictional business
operation involves complex intercompany operating and financing activities. The nature of these activities can result
in uncertainties in the estimation of the related tax exposures. The Company initially recognizes and subsequently
measures the largest amount of tax benefit in its consolidated financial statements when it is more likely than not that
the position will be sustained upon examination by the tax authorities. As at 31 December 2019, the Company
recorded unrecognized tax benefits of $58.0 million.

We identified the assessment of unrecognized tax benefits as a critical audit matter because complex auditor
judgment and specialized skills were required in evaluating the Company’s interpretation and application of tax laws
in the jurisdictions where it operates and its estimate of the ultimate resolution of the tax position.

The primary procedures we performed to address this critical audit matter included the following. We tested certain
internal controls over the Company’s unrecognized tax benefit process, including controls over (1) its identification
and application of tax statutes and legislation, and changes thereto, in the various jurisdictions in which it operates
and (2) its application in the process to estimate the associated unrecognized tax benefit. We inspected the
Company’s legal composition to identify and assess changes in operating structures and financing arrangements.
We inquired of the Group’s tax department in combination with inspecting correspondence with the responsible tax
authorities. We involved professionals with specialized skills and knowledge, who assisted in:

›

evaluating the Company’s interpretation and application of multi-jurisdictional tax laws, and changes thereto, and
its impact on the unrecognized tax benefit,

208

›

inspecting the lapse of statute of limitations and settlements with tax authorities over a selection of unrecognized
tax benefits to compare the amount in the settlement documents to the unrecognized tax benefit, and

›

inspecting a selection of intercompany operating and financing activities between group entities to assess the

sustainability of tax positions based on their technical merits and the probabilities of possible settlement

alternatives.

/s/ KPMG AG Wirtschaftsprüfungsgesellschaft

We have served as the Company’s auditor since 2015.

Düsseldorf, Germany

February 28, 2020

Report of independent registered public accounting firm

Critical Audit MattersEvaluation of certain long-lived asset impairmentsEvaluation of the Formulatrix asset purchase agreement as an asset acquisitionAssessment of unrecognized tax benefits 
listed in the agreement, to evaluate the Company’s identification of assets acquired. We evaluated the Company’s

assessment that substantially all the fair value of the assets acquired was concentrated in a single identifiable asset or

group of similar identifiable assets by inspecting the nature of these assets and comparisons to external cost and

external market research studies to assess for indications of dissimilar characteristics. In addition, we involved

valuation professionals with specialized skills and knowledge, who assisted in:

›

evaluating the identification of the intangible assets acquired from the Formulatrix asset purchase transaction by

inspecting and evaluating legal terms that would give rise to identifiable intangible assets; and

›

assessing the Company’s determination of combining the Formulatrix intangible assets into a single developed

technology intangible asset.

As discussed in Note 17 to the consolidated financial statements, the Company conducts its business globally and

operates more than 50 consolidated subsidiaries in multiple tax jurisdictions. This multi-jurisdictional business

operation involves complex intercompany operating and financing activities. The nature of these activities can result

in uncertainties in the estimation of the related tax exposures. The Company initially recognizes and subsequently

measures the largest amount of tax benefit in its consolidated financial statements when it is more likely than not that

the position will be sustained upon examination by the tax authorities. As at 31 December 2019, the Company

recorded unrecognized tax benefits of $58.0 million.

We identified the assessment of unrecognized tax benefits as a critical audit matter because complex auditor

judgment and specialized skills were required in evaluating the Company’s interpretation and application of tax laws

in the jurisdictions where it operates and its estimate of the ultimate resolution of the tax position.

The primary procedures we performed to address this critical audit matter included the following. We tested certain
internal controls over the Company’s unrecognized tax benefit process, including controls over (1) its identification
and application of tax statutes and legislation, and changes thereto, in the various jurisdictions in which it operates
F I N A N C I A L   R E S U LT S
and (2) its application in the process to estimate the associated unrecognized tax benefit. We inspected the
Company’s legal composition to identify and assess changes in operating structures and financing arrangements.
We inquired of the Group’s tax department in combination with inspecting correspondence with the responsible tax
authorities. We involved professionals with specialized skills and knowledge, who assisted in:

Auditor’s Report

›

›

›

evaluating the Company’s interpretation and application of multi-jurisdictional tax laws, and changes thereto, and
its impact on the unrecognized tax benefit,

inspecting the lapse of statute of limitations and settlements with tax authorities over a selection of unrecognized
tax benefits to compare the amount in the settlement documents to the unrecognized tax benefit, and

inspecting a selection of intercompany operating and financing activities between group entities to assess the
sustainability of tax positions based on their technical merits and the probabilities of possible settlement
alternatives.

/s/ KPMG AG Wirtschaftsprüfungsgesellschaft

We have served as the Company’s auditor since 2015.

Düsseldorf, Germany

February 28, 2020

Report of independent registered public accounting firm

To the Shareholders and Supervisory Board

QIAGEN N.V.:

We have audited QIAGEN N.V.’s and subsidiaries’ (the “Company”) internal control over financial reporting as of
December 31, 2019, based on criteria established in Internal Control - Integrated Framework (2013) issued by the
Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in
all material respects, effective internal control over financial reporting as of December 31, 2019, based on criteria
established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations
of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2019 and 2018, the related
consolidated statements of (loss) income, comprehensive (loss) income, changes in equity, and cash flows for each of
the years in the three-year period ended December 31, 2019, and the related notes and financial statement
schedule as listed in Item 18 (A) (collectively, the consolidated financial statements), and our report dated February
28, 2020 expressed an unqualified opinion on those consolidated financial statements.

The Company’s management is responsible for maintaining effective internal control over financial reporting and for
its assessment of the effectiveness of internal control over financial reporting, included in the accompanying ‘Report
of Management on Internal Control over Financial Reporting’. Our responsibility is to express an opinion on the
Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered
with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.
federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the
PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting
was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an
understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and

209

testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our

audit also included performing such other procedures as we considered necessary in the circumstances. We believe

that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance

regarding the reliability of financial reporting and the preparation of financial statements for external purposes in

accordance with generally accepted accounting principles. A company’s internal control over financial reporting

includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail,

accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable

assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance

with generally accepted accounting principles, and that receipts and expenditures of the company are being made

only in accordance with authorizations of management and directors of the company; and (3) provide reasonable

assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s

assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

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.

Assessment of unrecognized tax benefitsOpinion on Internal Control Over Financial ReportingBasis for OpinionDefinition and Limitations of Internal Control Over Financial Reporting 
To the Shareholders and Supervisory Board

QIAGEN N.V.:

We have audited QIAGEN N.V.’s and subsidiaries’ (the “Company”) internal control over financial reporting as of

December 31, 2019, based on criteria established in Internal Control - Integrated Framework (2013) issued by the

Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in

all material respects, effective internal control over financial reporting as of December 31, 2019, based on criteria

established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations

of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United

States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2019 and 2018, the related

consolidated statements of (loss) income, comprehensive (loss) income, changes in equity, and cash flows for each of

the years in the three-year period ended December 31, 2019, and the related notes and financial statement

schedule as listed in Item 18 (A) (collectively, the consolidated financial statements), and our report dated February

28, 2020 expressed an unqualified opinion on those consolidated financial statements.

The Company’s management is responsible for maintaining effective internal control over financial reporting and for
its assessment of the effectiveness of internal control over financial reporting, included in the accompanying ‘Report
of Management on Internal Control over Financial Reporting’. Our responsibility is to express an opinion on the
Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered
with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S.
federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the
PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting
was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an
understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and
testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our
audit also included performing such other procedures as we considered necessary in the circumstances. We believe
that our audit provides a reasonable basis for our opinion.

A company’s internal control over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes in
accordance with generally accepted accounting principles. A company’s internal control over financial reporting
includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail,
accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable
assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance
with generally accepted accounting principles, and that receipts and expenditures of the company are being made
only in accordance with authorizations of management and directors of the company; and (3) provide reasonable
assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s
assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.
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.

/s/ KPMG AG Wirtschaftsprüfungsgesellschaft

Düsseldorf, Germany

February 28, 2020

210

Opinion on Internal Control Over Financial ReportingBasis for OpinionDefinition and Limitations of Internal Control Over Financial Reporting 
F I N A N C I A L   R E S U LT S

Auditor’s Report

211

Financial Results
Financial Results

List of Subsidiaries
Auditor’s Report
The following is a list of the Registrant’s subsidiaries as of December 31, 2019, 
The following is a list of the Registrant’s subsidiaries as of December 31, 2019, other than certain subsidiaries that
other than certain subsidiaries that did not in the aggregate constitute a  
did not in the aggregate constitute a significant subsidiary.
Report of independent registered public accounting firm
significant subsidiary.

To the Shareholders and Supervisory Board

Amnisure International, LLC
QIAGEN N.V.:

Cellestis Pty. Ltd.

STAT-Dx Life S.L.

USA

Australia

Spain

QIAGEN Aarhus A/S
We have audited the accompanying consolidated balance sheets of QIAGEN N.V. and subsidiaries (the
QIAGEN AB
“Company”) as of December 31, 2019 and 2018, the related consolidated statements of (loss) income,
comprehensive (loss) income, changes in equity, and cash flows for each of the years in the three-year period ended
QIAGEN AG
December 31, 2019, and the related notes and financial statement schedule as listed in Item 18 (A) (collectively, the
QIAGEN Australia Holding Pty. Ltd.
consolidated financial statements). In our opinion, the consolidated financial statements present fairly, in all material
QIAGEN Benelux B.V.
respects, the financial position of the Company as of December 31, 2019 and 2018, and the results of its
QIAGEN Beverly, LLC
operations and its cash flows for each of the years in the three-year period ended December 31, 2019, in conformity
QIAGEN China (Shanghai) Co. Ltd.
with U.S. generally accepted accounting principles.

Netherlands

Switzerland

Denmark

Australia

Sweden

China

USA

QIAGEN Deutschland Holding (Luxembourg) SARL

Luxembourg

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United
QIAGEN Deutschland Holding GmbH
States) (PCAOB), the Company’s internal control over financial reporting as of December 31, 2019, based on
QIAGEN Finance (Malta) Ltd.
criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring
QIAGEN France S.A.S.
Organizations of the Treadway Commission, and our report dated February 28, 2020 expressed an unqualified
QIAGEN Gaithersburg LLC
opinion on the effectiveness of the Company’s internal control over financial reporting.
QIAGEN GmbH

Germany

Germany

France

Malta

USA

QIAGEN Hamburg GmbH

Germany

QIAGEN Inc. (Canada)
As discussed in Note 2 to the consolidated financial statements, the Company has changed its method of accounting
QIAGEN Instruments AG
for leases in 2019 due to the adoption of Accounting Standards Codification Topic 842 - Leases. In 2018, the
QIAGEN K.K.
Japan
Company has changed its method of accounting for revenue from contracts with customers due to the adoption of
Accounting Standards Codification Topic 606 - Revenue from Contracts with Customers.
QIAGEN Lake Constance GmbH
Germany

Switzerland

Canada

QIAGEN LLC

QIAGEN Ltd.

USA

UK

QIAGEN Manchester Ltd.
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to
QIAGEN Marseille S.A.S.
express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm
registered with the PCAOB and are required to be independent with respect to the Company in accordance with the
QIAGEN North American Holdings Inc.
U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and
QIAGEN Pty. Ltd.
the PCAOB.
QIAGEN Redwood City, Inc.

Australia

France

USA

USA

UK

QIAGEN Sciences LLC
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and
QIAGEN S.r.l.
perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of
material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks
QIAGEN TRM Services Ltd.
UAE
of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing
QIAGEN U.S. Finance Holdings (Luxembourg) SARL
procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the
QIAGEN U.S. Finance LLC
amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting
QIAGEN U.S. Finance Ltd

Luxembourg

Ireland

USA

USA

Italy

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Company NameJurisdiction of IncorporationOpinion on the Consolidated Financial StatementsChange in Accounting PrincipleBasis for OpinionF I N A N C I A L   R E S U LT S

List of Subsidiaries

Appendix
Appendix
Appendix

Service
Service
Service
CORPORATE COMMUNICATIONS
CORPORATE COMMUNICATIONS
CORPORATE COMMUNICATIONS

Phone worldwide: +49 2103 29 11711 
Phone U.S.: +1 240 686 2222 
Phone worldwide: +49 2103 29 11711 
Phone worldwide: +49 2103 29 11711 
Email: IR@QIAGEN.COM 
Phone U.S.: +1 240 686 2222 
Phone U.S.: +1 240 686 2222 
IR.QIAGEN.COM
Email: IR@QIAGEN.COM 
Email: IR@QIAGEN.COM 
IR.QIAGEN.COM
IR.QIAGEN.COM

Phone worldwide: +49 2103 29 11826 
Phone U.S.: +1 240 686 7425 
Phone worldwide: +49 2103 29 11826 
Phone worldwide: +49 2103 29 11826 
Email: PR@QIAGEN.COM 
Phone U.S.: +1 240 686 7425 
Phone U.S.: +1 240 686 7425 
PR.QIAGEN.COM
Email: PR@QIAGEN.COM 
Email: PR@QIAGEN.COM 
PR.QIAGEN.COM
PR.QIAGEN.COM

www.QIAGEN.com 
www.corporate.QIAGEN.com 
www.QIAGEN.com 
www.QIAGEN.com 
www.facebook.com/QIAGEN 
www.corporate.QIAGEN.com 
www.corporate.QIAGEN.com 
www.twitter.com/QIAGEN 
www.facebook.com/QIAGEN 
www.facebook.com/QIAGEN 
www.linkedin.com/company/QIAGEN 
www.twitter.com/QIAGEN 
www.twitter.com/QIAGEN 
www.youtube.com/QIAGEN
www.linkedin.com/company/QIAGEN 
www.linkedin.com/company/QIAGEN 
www.youtube.com/QIAGEN
www.youtube.com/QIAGEN
FINANCIAL CALENDAR
FINANCIAL CALENDAR
FINANCIAL CALENDAR

June, 2020
June, 2020
June, 2020

July 2020
July 2020
July 2020

November 2020
November 2020
November 2020

February 2021
February 2021
February 2021

March 2021
March 2021
March 2021

213

For InvestorsFor MediaQIAGEN on the webAnnual General Meeting of Shareholders of QIAGEN N.V.Second Quarter 2020 ResultsThird Quarter 2020 ResultsFourth Quarter 2020 ResultsPublication DateFor InvestorsFor MediaQIAGEN on the webAnnual General Meeting of Shareholders of QIAGEN N.V.Second Quarter 2020 ResultsThird Quarter 2020 ResultsFourth Quarter 2020 ResultsPublication DateFor InvestorsFor MediaQIAGEN on the webAnnual General Meeting of Shareholders of QIAGEN N.V.Second Quarter 2020 ResultsThird Quarter 2020 ResultsFourth Quarter 2020 ResultsPublication DateTRADEMARKS

Our name together with our logo is registered as a trademark in the United States and a number of other countries:
QIAGEN® .

For a complete list of QIAGEN’s trademarks and disclaimers, please refer to QIAGEN’s webpage under
www.QIAGEN.com/trademarks_disclaimers.aspx.

In this annual report QIAGEN uses the term molecular diagnostics. The use of this term is in reference to certain
countries, such as the United States, limited to products subject to regulatory requirements. As of February 2019,
QIAGEN molecular diagnostics products included 23 FDA (PMA approved or 510k cleared) products, 17 clinical
sample concentrator products (14 kits and 3 instruments), 66 EU CE IVD assays, 17 EU CE IVD sample preparation
products, 17 EU CE IVD instruments for sample purification or detection, 34 China CFDA IVD assays/sample
preparations and 9 China CFDA IVD instruments.

This Annual Report may also contain trade names or trademarks of companies other than QIAGEN.

©  2020 QIAGEN, all rights reserved.

This document contains detailed financial information about QIAGEN prepared under generally accepted
accounting standards in the U.S. (U.S. GAAP) and included in our Form 20-F annual report filed with the U.S.
Securities and Exchange Commission. QIAGEN also publishes an Annual Report under IFRS accounting standards,
which is available on our website at www.QIAGEN.com.

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List of Subsidiaries

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