v3.25.4
Income Taxes (Tables)
 12 Months Ended
Dec. 31, 2025
Income Tax Disclosure [Abstract]  
Schedule of Components of [Income (Loss)] from Continuing Operations Before Income Tax Expense (Benefit)
The components of income (loss) before income tax benefit and equity in loss of investees were as follows (in thousands):
Year Ended December 31,
202520242023
Ireland$164,697 $497,860 $449,214 
United States(872,206)29,594 (6,056)
United Kingdom (251,890)(411,356)(643,096)
Other331,540 354,253 497,867 
Total$(627,859)$470,351 $297,929 
Schedule of Details of Income Tax Expense (Benefit)
The following table sets forth the details of income tax expense (benefit) (in thousands):
Year Ended December 31,
202520242023
Current
Ireland$71,627 $97,680 $77,343 
United States44,093 22,065 20,803 
United Kingdom9,108 207 7,726 
Other47,700 (3,054)34,433 
Total current tax expense172,528 116,898 140,305 
Deferred, exclusive of other components below
Ireland(9,820)(20,022)(10,919)
United States(296,555)(63,162)(89,246)
United Kingdom(122,939)(114,600)(150,506)
Other(13,582)(11,481)(8,990)
Total deferred, exclusive of other components(442,896)(209,265)(259,661)
Deferred, change in tax rates
United States(2,075)955 (824)
United Kingdom— — 268 
Other— (17)— 
Total deferred, change in tax rates(2,075)938 (556)
Total deferred tax benefit(444,971)(208,327)(260,217)
Total income tax expense (benefit)
Ireland61,807 77,658 66,424 
United States(254,537)(40,142)(69,267)
United Kingdom(113,831)(114,393)(142,512)
Other34,118 (14,552)25,443 
Total income tax expense (benefit)$(272,443)$(91,429)$(119,912)
Schedule of Reconciliation of Income Taxes at the Statutory Income Tax Rate to Effective Income Tax Rate The reconciliation between the income tax benefit at the Irish statutory trading income tax rate of 12.5 percent, the jurisdiction of tax domicile of Jazz Pharmaceuticals, applied to the loss before income tax benefit and equity in loss of investees and our reported income tax benefit pursuant to the disclosure requirements of ASU 2023-09 for the year ended December 31, 2025 was as follows (in thousands, except percentages):
Year Ended December 31,
2025
Income tax at the statutory tax rate$(78,482)12.5 %
Domestic tax effects
Effects of cross-border tax laws(1)
29,812 (4.7)
Non-taxable/non-deductible items
Non-deductible financing costs7,070 (1.1)
Other963 (0.2)
Foreign tax effects
United States
Statutory income tax rate differential(74,137)11.8
Non-deductible acquired in-process research and development expense187,346 (29.8)
Change in valuation allowance(199,907)31.8
Research and orphan drug tax credits(35,329)5.6
Foreign Derived Intangible Income benefit(28,623)4.6
Non-deductible compensation8,856 (1.4)
Non-deductible contingent consideration payments7,641 (1.2)
State and local income tax, net of federal benefit(5,477)0.9
Tax deficiencies/(excess tax benefits) from share-based compensation5,050 (0.8)
Other525 (0.1)
United Kingdom
Statutory income tax rate differential(30,766)4.9
Patent box incentive benefit(60,993)9.7
Non-deductible financing costs7,222 (1.2)
Other2,107 (0.3)
Italy
Statutory income tax rate differential7,603 (1.2)
Other2,006 (0.3)
Malta
Statutory income tax rate differential64,010 (10.2)
Deduction on subsidiary equity(90,788)14.5
Other827 (0.1)
Other foreign jurisdictions7,460 (1.2)
Worldwide changes in unrecognized tax benefits(6,439)0.9
Total income tax benefit$(272,443)43.4 %
________________________
(1) Related to Pillar two top-up taxes imposed by Ireland in respect of income in Malta
The reconciliation between income tax benefit at the Irish statutory trading income tax rate of 12.5 percent, the jurisdiction of tax domicile of Jazz Pharmaceuticals, applied to the income before income tax benefit and equity in loss of investees and our reported income tax benefit for the years ended December 31, 2024 and 2023 was as follows (in thousands):
Year Ended December 31,
20242023
Income tax expense at the statutory income tax rate$58,794 $37,241 
Change in valuation allowance201,996 75,081 
Deduction on subsidiary equity(180,460)(153,655)
Change in estimates(1)
(106,007)(5,472)
Patent box incentive benefit(2)
(65,413)(13,862)
Research and other tax credits(65,255)(49,900)
Foreign derived intangible income benefit (39,470)(42,400)
Foreign income tax rate differential38,346 (7,763)
Non-deductible financing costs22,437 15,705 
Tax deficiencies/(excess tax benefits) from share-based compensation18,074 3,959 
Non-deductible compensation10,889 14,092 
Change in unrecognized tax benefits9,767 (12,612)
Change in tax rate938 (605)
Non-deductible facility expense22 16,618 
Other3,913 3,661 
Reported income tax benefit$(91,429)$(119,912)
________________________
(1) The 2024 change in estimates includes a benefit of $103.3 million that is fully offset by a related change in valuation allowance, resulting in a net nil impact to our income tax benefit.
(2) The 2024 patent box incentive benefit includes a non-recurring benefit of $40.9 million related to a claim for benefits in Italy in respect of tax years 2020 to 2023.
Schedule of Income Taxes Paid, Net of Refunds Received
The following table sets forth the details of income taxes paid, net of refunds received, by jurisdiction pursuant to the disclosure requirements of ASU 2023-09 for the year ended December 31, 2025 (in thousands):
Year Ended December 31,
2025
Ireland$82,363 
Foreign
United States - federal11,763 
Other27,682 
Total foreign39,445 
Total cash paid for income taxes, net of refunds$121,808 
Schedule of Net Deferred Tax Assets (Liabilities)
Significant components of our net deferred tax assets (liabilities) were as follows (in thousands):
December 31,
20252024
Deferred tax assets:
Capitalized research and development$398,547 $295,779 
Deduction on subsidiary equity carryforwards395,115 393,960 
Operating loss carryforwards394,614 307,413 
Intangible assets264,002 243,391 
Tax credit carryforwards190,819 127,483 
Accrued liabilities130,948 115,290 
Share-based compensation47,878 47,486 
Indirect effects of unrecognized tax benefits31,625 35,000 
Other16,175 15,714 
Total deferred tax assets1,869,723 1,581,516 
Valuation allowance(529,674)(509,190)
Deferred tax assets, net of valuation allowance1,340,049 1,072,326 
Deferred tax liabilities:
Intangible assets(1,041,150)(1,130,485)
Inventories(13,532)(47,802)
Other(10,707)(10,530)
Total deferred tax liabilities(1,065,389)(1,188,817)
Net deferred tax assets (liabilities)$274,660 $(116,491)
The following table summarizes the presentation of deferred tax assets and liabilities (in thousands):
December 31,
20252024
Deferred tax assets$869,130 $560,245 
Deferred tax liabilities(594,470)(676,736)
Net deferred tax assets (liabilities)$274,660 $(116,491)
Schedule of Reconciliation of Unrecognized Tax Benefits
A reconciliation of our unrecognized tax benefits follows (in thousands):
 December 31,
 202520242023
Balance at the beginning of the year$125,978 $122,694 $143,976 
Increases related to current year tax positions24,536 32,559 15,004 
Increases related to prior year tax positions1,199 — 224 
Decreases related to prior year tax positions(648)(150)(12,702)
Acquisition-related increases18,663 — — 
Decreases related to settlements with taxing authorities— (2,605)— 
Lapse of the applicable statute of limitations(26,706)(26,520)(23,808)
Balance at the end of the year$143,022 $125,978 $122,694