Zoetis Inc. (ZTS) Risk Factors

Recent key developments

Concrete developments — dated events, named agreements and instruments, legal proceedings — that Zoetis Inc. surfaced in its latest filing.

• Simparica/Simparica Trio, Apoquel/Apoquel Chewable, Cytopoint, Librela, and the ceftiofur line contributed approximately 42% of our revenue in 20252025
• Several companies have launched generic versions of our Rimadyl chewable and Draxxin products
• Sales of our Rimadyl chewable and Draxxin products have declined in the U.S. by 39% and 66%, respectively, since the start of generic and other competition
• Our total revenue attributable to antibacterials for livestock was approximately $713 million for the year ended December 31, 20252025-12-31
• Italy has implemented the use of electronic prescriptions, which has caused more disciplined use of antibiotics and decreased the demand for our antibacterial products
• As of December 31, 2025, we had goodwill of $2.8 billion and identifiable intangible assets, less accumulated amortization, of $1.0 billion2025-12-31
• On December 31, 2025, we had a global manufacturing network consisting of 21 manufacturing sites located in 10 countries2025-12-31
• During the COVID-19 pandemic we experienced challenges in manufacturing certain products including Simparica Trio, and the component parts of certain products including Librela and Solensia
• The company sells limited humanitarian animal health products, including medicines and vaccines, to Russia and Iran
• The EU adopted the European Sustainability Reporting Standards (ESRS) and the Corporate Sustainability Reporting Directive (CSRD) requiring disclosure by EU entities, including certain EU subsidiaries of non-EU entities, regarding environmental, social and governance issues
• The State of California passed the Climate Corporate Data Accountability Act and the Climate-Related Financial Risk Act imposing broad climate-related disclosure obligations on certain companies doing business in California, including the company
• The company is subject to chemical regulation in the US and internationally, and governmental authorities are focusing on preventing environmental contamination from PFAS, which may be contained in certain products or product packaging
• At least one pharmacy in Brazil may be illegally compounding oclacitinib, the active pharmaceutical ingredient in Apoquel
• Some counterfeit versions of Simparica and Apoquel products have been found in Brazil and the company is coordinating with local authorities
• Zoetis has expanded its diagnostics portfolio
• Laws include U.S. state privacy laws, EU GDPR, UK GDPR, Brazilian LGPD, China's PIPL, and India's DPDP Act
• We are in the process of a multi-year implementation process to update our enterprise resource planning (ERP) system to a new fully cloud-based system
• European operations are subject to NIS2 cybersecurity requirements as essential entities
• EU AI Act prohibits certain High-Risk AI systems and requires disclosures about AI tool use
• In 2025, approximately 42% of revenue was generated in currencies other than the U.S. dollar2025
• In September 2024, the IRS issued a Revenue Agent Report related to the one-time mandatory deemed repatriation tax, and the company disagrees with the IRS' position and will defend it2024-09
• As of December 31, 2025, we had approximately $9.2 billion of total unsecured indebtedness outstanding related to our senior notes and convertible senior notes2025-12-31
• We currently have agreements for a $1.25 billion multi-year revolving credit facility and a $1.0 billion commercial paper program
• Under the Patent and Know-How License Agreement, Pfizer licenses certain intellectual property to us
• If we fail to comply with our obligations and Pfizer terminates the license, our ability to develop and commercialize products incorporating that intellectual property will be limited