(10) Cost of sales
Accounting and measurement policies
Cost of sales
The cost of sales primarily includes the cost of sales of manufactured products sold and the amortized cost of merchandise sold.
Cost comprises the following items: directly attributable costs, such as cost of materials, personnel and energy costs, depreciation and amortization, overheads attributable to the production process, and inventory impairment losses and their reversals.
The cost of sales included amortization of intangible assets (excluding amortization of internally generated intangible assets or separately acquired software) in the amount of € 224 million (2024: € 131 million). The increase was mainly attributable to the addition of intangible assets in connection with the acquisition of SpringWorks Therapeutics, Inc., United States (see Note (6) Acquisitions and divestments). Material costs amounted to € 3,545 million in fiscal 2025 (2024: € 3,753 million) and were reported under cost of sales. The cost of sales also included royalties for Bavencio® of € 91 million (2024: € 111 million).
Impairment losses on inventories amounted to € 271 million in the reporting period (2024: € 329 million). Reversals of impairment losses amounted to € 216 million (2024: € 278 million).