UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q



~~[X]~~☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: ~~September 30, 2017~~June 27, 2020



~~[ ]~~☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-36353

Perrigo Company plc

(Exact name of registrant as specified in its charter)



Ireland		Not Applicable
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

~~Treasury Building, Lower Grand Canal Street, Dublin 2, Ireland~~		-
~~(Address of principal executive offices)~~		~~(Zip Code)~~

The Sharp Building,Hogan Place,Dublin 2,IrelandD02 TY74

+35317094000

(~~Registrant’s~~Address, including zip code, and telephone number, including

area ~~code)~~code, of registrant’s principal executive offices)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

~~________________________________________~~ Securities registered pursuant to Section 12(b) of the Act:



Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Ordinary shares	PRGO	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such ~~report)~~reports), and (2) has been subject to such filing requirements for the past 90 days. ~~YES [X] NO [ ]~~Yes☒ No ☐

Indicate by check mark whether the registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files). ~~YES [X] NO [ ]~~Yes☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and "emerging growth company" in Rule 12b-2 of the Exchange Act.



Large accelerated filer	~~[X]~~☒	Accelerated filer	~~[ ]~~☐	Non-accelerated filer	~~[ ]~~☐	~~(Do not check if smaller reporting company)~~
Smaller reporting company	~~[ ]~~☐
Emerging growth company	~~[ ]~~☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.							~~[ ]~~☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). ~~[ ] YES [X] NO~~

☐ Yes ☒ No

As of ~~November 3, 2017,~~July 31, 2020, there were ~~140,840,721~~136,479,503 ordinary shares outstanding.

PERRIGO COMPANY PLC

FORM 10-Q

INDEX


		PAGE NUMBER		PAGE NUMBER
Cautionary Note Regarding Forward-Looking Statements	Cautionary Note Regarding Forward-Looking Statements	1	Cautionary Note Regarding Forward-Looking Statements	1

PART I. FINANCIAL INFORMATION	PART I. FINANCIAL INFORMATION		PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)	Item 1. Financial Statements (Unaudited)		Item 1. Financial Statements (Unaudited)

Condensed Consolidated Statements of Operations for the Three and Nine Months Ended September 30, 2017 and October 1, 2016		2
Condensed Consolidated Statements of Operations			Condensed Consolidated Statements of Operations	2

Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Nine Months Ended September 30, 2017 and October 1, 2016		3
Condensed Consolidated Statements of Comprehensive Income			Condensed Consolidated Statements of Comprehensive Income	3

Condensed Consolidated Balance Sheets as of September 30, 2017 and December 31, 2016		4
Condensed Consolidated Balance Sheets			Condensed Consolidated Balance Sheets	4

Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2017 and October 1, 2016		5
Condensed Consolidated Statements of Shareholders' Equity			Condensed Consolidated Statements of Shareholders' Equity	5

Condensed Consolidated Statements of Cash Flows			Condensed Consolidated Statements of Cash Flows	6

Notes to the Condensed Consolidated Financial Statements	Notes to the Condensed Consolidated Financial Statements		Notes to the Condensed Consolidated Financial Statements

1	Summary of Significant Accounting Policies	6	Summary of Significant Accounting Policies	7

2	Divestitures	10	Revenue Recognition	9

3	Goodwill and Other Intangible Assets	10	Acquisitions and Divestitures	11

4	Accounts Receivable Factoring	12	Goodwill and Intangible Assets	15

5	Inventories	12	Inventories	16

6	Fair Value Measurements	12	Fair Value Measurements	16

7	Investments	17	Investments	20

8	Derivative Instruments and Hedging Activities	18	Derivative Instruments and Hedging Activities	20

9	Assets Held For Sale	21	Leases	26

10	Indebtedness	22	Indebtedness	28

11	Earnings per Share and Shareholders' Equity	24	Earnings per Share and Shareholders' Equity	29

12	Accumulated Other Comprehensive Income (Loss)	25	Accumulated Other Comprehensive Income (Loss)	30

13	Income Taxes	25	Income Taxes	30

14	Commitments and Contingencies	26	Contingencies	32

15	Restructuring Charges	30	Restructuring Charges	43

16	Segment Information	30	Segment Information	43

17			Subsequent Events	44

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	31	Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	44

Item 3. Quantitative and Qualitative Disclosures About Market Risk	Item 3. Quantitative and Qualitative Disclosures About Market Risk	52	Item 3. Quantitative and Qualitative Disclosures About Market Risk	64

Item 4. Controls and Procedures	Item 4. Controls and Procedures	52	Item 4. Controls and Procedures	65

PART II. OTHER INFORMATION	PART II. OTHER INFORMATION		PART II. OTHER INFORMATION

Item 1. Legal Proceedings	Item 1. Legal Proceedings	55	Item 1. Legal Proceedings	65

Item 1A. Risk Factors	Item 1A. Risk Factors	55	Item 1A. Risk Factors	65

Item 2. Unregistered Sale of Equity Securities and Use of Proceeds		57

Item 5. Other Information		57

Item 6. Exhibits	Item 6. Exhibits	58	Item 6. Exhibits	67

SIGNATURES		59
Signatures			Signatures	68

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements in this report are “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor created thereby. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our, or our industry’s actual results, levels of activity, performance or achievements to be materially different from those expressed or implied by any forward-looking statements. In particular, statements about our expectations, beliefs, plans, objectives, assumptions, future events or future performance contained in this report, including certain statements contained in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as “may,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” "forecast," “predict,” “potential” or the negative of those terms or other comparable terminology.

Please see Item 1A of our Form 10-K for the year ended December 31, 2016 for a discussion of certain important risk factors that relate to forward-looking statements contained in this report and Part II, Item 1A of this Form 10-Q. We have based these forward-looking statements on our current expectations, assumptions, estimates and projections. While we believe these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control, including: the effect of the novel coronavirus (COVID-19) pandemic and the associated economic downturn and supply chain impacts on the Company's business, the timing, amount and cost of any share repurchases; future impairment charges; ~~the success of management transition;~~ customer acceptance of new products; competition from other industry participants, some of whom have greater marketing resources or larger market shares in certain product categories than we do; pricing pressures from customers and consumers; resolution of uncertain tax positions, including the Company's appeal of the Notice of Assessment ("NoA") issued by the Irish Office of the Revenue Commissioners (“Irish Revenue”) and the Notices of Proposed Adjustment ("NOPAs") issued by the U.S. Internal Revenue Service and the impact that an adverse result in any such proceeding could have on operating results, cash flows and liquidity; potential third-party claims and litigation, including litigation relating to ~~our restatement of previously-filed financial information;~~alleged price-fixing in the generic pharmaceutical industry, alleged class action and individual securities law claims, and alleged product liability claims and litigation relating to uncertain tax positions, including the NoA and NOPAs; potential impacts of ongoing or future government investigations and regulatory initiatives; ~~resolution~~potential costs and reputational impact of ~~uncertain tax positions;~~product recalls and sales halts; the impact of ~~U.S.~~ tax reform ~~legislation;~~legislation and healthcare policy; general economic conditions; fluctuations in currency exchange rates and interest rates; the consummation of announced acquisitions or dispositions and the success of such transactions, and our ability to realize the desired benefits thereof; and ~~the~~our ability to execute and achieve the desired benefits of announced cost-reduction efforts, and strategic and other initiatives. ~~In addition, we may identify~~An adverse result with respect to our appeal of any material outstanding tax assessments or litigation, could ultimately require the use of corporate assets to pay such assessments, damages from third-party claims, and ~~be unable~~related interest and/or penalties, and any such use of corporate assets would limit the assets available for other corporate purposes. Statements regarding the separation of the RX business, including the expected benefits, anticipated timing, form of any such separation and whether the separation ultimately occurs, are all subject to ~~remediate one or more material weaknesses in~~various risks and uncertainties, including future financial and operating results, our ~~internal control over financial reporting. Furthermore, we and/~~ability to separate the business, the effect of existing interdependencies with our manufacturing and shared service operations, and the tax consequences of the planned separation to us or our subsidiaries may incur additional tax liabilities in respect of 2016 and prior years as a result of any restatement or may be found to have breached certain provisions of Irish company legislation in respect of prior financial statements and if so may incur additional expenses and penalties.shareholders. These and other important factors, including those discussed in our ~~Form~~form 10-K for the ~~year ended~~year-ended December 31, ~~2016, in~~2019, this report under “Risk Factors” and in any subsequent filings with the United States Securities and Exchange Commission, may cause actual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. The forward-looking statements in this report are made only as of the date hereof, and unless otherwise required by applicable securities laws, we disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

TRADEMARKS, TRADE NAMES AND SERVICE MARKS

This report contains trademarks, trade names and service marks that are the property of Perrigo Company plc, as well as, for informational purposes, trademarks, trade names, and service marks that are the property of other organizations. Solely for convenience, certain trademarks, trade names, and service marks referred to in this report appear without the ^®,™ and ^SMsymbols, but those references are not intended to indicate that we or the applicable owner, as the case may be, will not assert, to the fullest extent under applicable law, our or their rights to such trademarks, trade names, and service marks.



(1)	~~Nine Months Ended~~
	~~September 30, 2017~~
	~~Lumara~~
~~5-year average growth rate~~	~~(4.1)%~~
~~Discount rate~~	~~13.5%~~
~~Valuation method~~	~~MPEEM~~Unobservable inputs were weighted based on the relative estimated milestone payments.

The discount rate of 26.0% was based on our assessment of the rate of return and development and commercialization risk of the related IPR&D project. We reevaluate the significant unobservable inputs of the sales-based milestones quarterly based on project developments and changes in contingent elements of the liability.

~~Perrigo Company plc~~ ~~- Item 1~~

~~Note 6~~

Year Ended
December 31, 2016
Omega - Lifestyle Omega - XLS
Entocort^®- Branded Products

Entocort^®- AG Products
Herron Trade Names and Trademarks
5-year average growth rate 2.5% 3.2% (31.7)% (30.4)% 4.6%
Long-term growth rates 2.0% NA (10.0)% (4.7)% 2.5%
Discount rate 9.3% 9.5% 13.0% 10.5% 10.8%
Royalty rate NA 4.0% NA NA 11.0%
Valuation method MPEEM Relief from Royalty MPEEM MPEEM Relief from Royalty

We recorded Impairment charges on the Condensed Consolidated Statements of Operations related to definite-lived intangible assets of $18.5 million and $290.9 million for the nine months ended September 30, 2017 and October 1, 2016, respectively (refer to ~~Note 3~~).

~~Assets Held For Sale~~

~~When a group of assets is classified as held-for-sale, the book value is evaluated and adjusted to the lower of its carrying amount or fair value less the cost to sell (refer to~~ ~~Note 9~~).

Fixed Rate Long-term Debt

~~As of September 30, 2017 and December 31, 2016, our~~Our fixed rate long-term debt consisted of ~~public bonds, a private placement note, and retail bonds. As of September 30, 2017,~~ the ~~public bonds had a carrying value of~~following (in millions):

~~$2.6 billion and a fair value of $2.7 billion. As of December 31, 2016, the public bonds had a carrying value and fair value of $4.6 billion.~~



	June 27, 2020				December 31, 2019
	Level 1		Level 2		Level 1		Level 2
Public Bonds
Carrying Value (excluding discount)	$	3,350.0	$	—	$	2,600.0	$	—
Fair value	$	3,497.5	$	—	$	2,618.4	$	—

Private placement note
Carrying value (excluding premium)	$	—	$	151.5	$	—	$	151.4
Fair value	$	—	$	154.4	$	—	$	168.4

The fair values of our public bonds for ~~both~~all periods were based on quoted market ~~prices~~

~~(Level 1).~~

As of September 30, 2017, our retail bonds and private placement note had a carrying value of $655.8 million (excluding a premium of $35.6 million) and a fair value of $699.2 million. As of December 31, 2016, our retail bonds and private placement note had a carrying value of $773.1 million (excluding a premium of $49.8 million) and a fair value of $825.0 million.prices. The fair values of our ~~retail bonds and~~ private placement note for ~~both~~all periods were based on interest rates offered for borrowings of a similar nature and remaining ~~maturities (Level 2).~~maturities.

The carrying amounts of our other financial instruments, consisting of cash and cash equivalents, accounts receivable, accounts payable, short-term debt, revolving credit agreements, promissory notes related to our equity method investment in Kazmira, and variable rate long-term debt, approximate their fair value.

Perrigo Company plc - Item 1

Note 7

NOTE 7 – INVESTMENTS

~~Available for Sale Securities~~

~~Our available for sale~~The following table summarizes the measurement category, balance sheet location, and balances of our equity securities ~~are reported in Prepaid expenses and other current assets. Unrealized investment gains/(losses) on available for sale securities were as follows~~ (in millions):

September 30,
2017 December 31, 2016
Equity securities, at cost less impairments $ 15.5
$ 16.5
Gross unrealized gains —
21.7
Gross unrealized losses (9.4 ) —
Estimated fair value of equity securities $ 6.1
$ 38.2



Measurement Category	Balance Sheet Location	June 27, 2020		December 31, 2019
Fair value method	Prepaid expenses and other current assets	$	4.1	$	6.6
Fair value method⁽¹⁾	Other non-current assets	$	2.3	$	2.3
Equity method	Other non-current assets	$	70.5	$	17.8


(1)	Measured at fair value using the Net Asset Value practical expedient.

The ~~factors affecting~~following table summarizes the ~~assessment~~expense (income) recognized in earnings of impairments include both general financial market conditions and factors specific to a particular company. During the nine months ended October 1, 2016, we recorded an impairment charge of $1.8 million, which related to other-than-temporary impairments of marketableour equity securities ~~due~~(in millions):



		Three Months Ended						Six Months Ended
Measurement Category	Income Statement Location	June 27, 2020			June 29, 2019			June 27, 2020			June 29, 2019
Fair value method	Other (income) expense, net	$	(0.4	)	$	1.8		$	2.5		$	7.9
Equity method	Other (income) expense, net	$	(0.8	)	$	(1.0	)	$	(1.5	)	$	(1.7	)

On June 17, 2020, we announced our entrance into the cannabidiol (“CBD”) market through a strategic investment in and long-term supply agreement with Kazmira LLC ("Kazmira"), a leading supplier of hemp-based CBD products free of tetrahydrocannabinol (“THC-free”) based in Watkins, Colorado. In addition to ~~prolonged losses incurred on each~~the supply agreement, we acquired an approximate 20% equity stake in Kazmira for $50.0 million with $15.0 million paid at close of the ~~investments.~~

~~Perrigo Company plc~~ ~~- Item 1~~

~~Note 7~~

~~We have evaluated~~transaction and the ~~near-term prospects~~balance due within 18 months thereafter. Our minority equity investment initiates the first phase of the ~~equity securities~~partnership in ~~relation~~which we will collaborate to scale-up Kazmira’s facilities and laboratories, in accordance with current Good Manufacturing Practices, to produce THC-free CBD from industrial hemp that meets our standards for reliability and consistency. In the ~~severity and duration~~second phase of ~~any impairments, and based on that evaluation,~~the partnership, we ~~have the ability and intent~~will work to ~~hold these investments until a recovery of fair value.~~

~~During the nine months ended September 30, 2017, we sold~~launch THC-free hemp-based CBD products in a number of global markets, while leveraging our ~~investment securities and recorded a gain of $1.6 million. The gain was reclassified out of Accumulated Other Comprehensive Income (loss) ("AOCI") and into earnings.~~

~~Cost Method Investments~~

~~Our cost method investments totaled $7.2 million and $6.9 million at September 30, 2017 and~~

~~December 31, 2016, respectively, and are included in Other non-current assets.~~

~~Equity Method Investments~~

~~Our equity method investments totaled$4.8 million and $4.6 million at September 30, 2017 and December 31, 2016, respectively, and are included in Other non-current assets.~~supply agreement with Kazmira, which is exclusive for the U.S. store brand market. We ~~recorded net losses of $0.1 million and net gains of $0.2 million during the three and nine months ended September 30, 2017, respectively, and net gains of $0.1 million and net losses~~ of ~~$3.8 million during the three and nine months ended~~October 1, 2016, respectively, for our proportionate share of the equity method investment earnings or losses. The gains and losses were recorded in Other (income) expense, net on the Condensed Consolidated Statements of Operations.

~~During the nine months ended October 1, 2016, one of~~will report our equity method ~~investments became publicly traded. As a result, we transferred the $15.5 million investment to available for sale and recorded an $8.7 million unrealized gain, net of tax~~earnings from Kazmira in ~~Other Comprehensive Income ("OCI"). In addition, due to significant and prolonged losses incurred on one of~~ our ~~equity method investments, we recorded a $22.3 million impairment charge in Other (income) expense, net on the~~ Condensed Consolidated Financial Statements ~~of Operations.~~on a quarterly lag.

NOTE 8 – DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

We enter into certain derivative financial instruments, when available on a cost-effective basis, to mitigate our risk associated with changes in interest rates and foreign currency exchange rates as follows:Foreign Currency Forward Contract Net Investment Hedge

~~Interest rate risk management -~~ We are exposed to the impact of interest rate changes through our cash investments and borrowings. We utilize a variety of strategies to manage the impact of changes in interest rates, including using a mix of debt maturities along with both fixed-rate and variable-rate debt. In addition, we may enter into treasury-lock agreements and interest rate swap agreements on certain investing and borrowing transactions to manage our exposure to interest rate changes and our overall cost of borrowing.

~~Foreign currency exchange risk management -~~ We conduct business in several major currencies other than the U.S. dollar and are subject to risks associated with changing foreign exchange rates. Our objective is to reduce cash flow volatility associated with foreign exchange rate changes on a consolidated basis to allow management to focus its attention on business operations. Accordingly, we enter into various contracts that change in value as foreign exchange rates change to protect the value of existing foreign currency assets and liabilities, commitments, and anticipated foreign currency sales and expenses.

All derivative instruments are managed on a consolidated basis to efficiently net exposures and thus take advantage of any natural offsets. Gains and losses related to the derivative instruments are expected to be offset largely by gains and losses on the original underlying asset or liability. We do not use derivative financial instruments for speculative purposes.

All of our designated derivatives were classified as cash flow hedges as of September 30, 2017 and December 31, 2016. Designated derivatives meet hedge accounting criteria, which means the fair value of the hedge is recorded in shareholders’ equity as a component of OCI, net of tax. The deferred gains and losses are recognized in income in the period in which the hedged item affects earnings. Any ineffective portion of the change

~~Perrigo Company plc~~ ~~- Item 1~~

~~Note 8~~

~~in fair value of the derivative is immediately recognized in earnings. All of our designated derivatives are assessed for hedge effectiveness quarterly.~~

We also have economic non-designated derivatives that do not meet hedge accounting criteria. These derivative instruments are adjusted to current market value at the end of each period through earnings. Gains or losses on these instruments are offset substantially by the remeasurement adjustment on the hedged item.

~~Interest Rate Swaps and Treasury Locks~~

Interest rate swap agreements are contracts to exchange floating rate for fixed rate payments (or vice versa) over the life of the agreement without the exchange of the underlying notional amounts. The notional amounts of the interest rate swap agreements are used to measure interest to be paid or received and do not represent the amount of exposure to credit loss. The differential paid or received on the interest rate swap agreements is recognized as an adjustment to interest expense.

During the three months ended July 1, 2017, we repaid $584.4 million of senior notes with an interest rate of 4.000% due 2023 and $309.5 million of senior notes with an interest rate of 5.300% due 2043 (refer to ~~Note 10). As a result of the senior note repayments on~~On June 15, 2017, the proportionate amount remaining in OCI related to the pre-issuance hedge was reclassified to earnings. Accordingly, we recorded a loss of $5.9 million in Other expense, net, on the Condensed Consolidated Statements of Operations during the three months ended July 1, 2017 for the amount remaining in OCI.

~~During the six months ended December 31, 2015,~~19, 2020, we entered into a foreign currency forward interest rate swap to hedge against changes in the benchmark interest rate between the date the interest rate swap was entered into and the date of expected future debt issuance. The interest rate swap wascontract designated as a ~~cash flow~~net investment hedge ~~and had~~of the GBP currency exposure of our net investment in certain of our U.K. operations. The hedge has a notional ~~amount totaling $200.0 million.~~basis of £155.0 million ($194.5 million).

Cross Currency Swaps

On August 15, 2019, we entered into a cross-currency swap designated as a net investment hedge to hedge the EUR currency exposure of our net investment in European operations. This agreement is a contract to exchange floating-rate Euro payments for floating-rate U.S. dollar payments. The payments are based on a notional basis of €450.0 million ($498.0 million) and settle quarterly.

Interest Rate Swaps

There were no active designated or non-designated interest rate ~~swap was settled upon the issuance~~swaps as of ~~an aggregate $1.2 billion principal amount of senior notes on March 7, 2016 for a cumulative after-tax loss of $7.0 million in OCI during the three months ended April 2, 2016.~~June 27, 2020 and December 31, 2019.

Perrigo Company plc - Item 1

Note 8

Foreign Currency ~~Derivatives~~Forwards

~~We enter into foreign~~Foreign currency forward contracts ~~both designated and non-designated, in order to manage the impact~~were as follows (in millions):



	Notional Amount
	June 27, 2020		December 31, 2019
Israeli Shekel (ILS)	$	351.2	$	712.7
European Euro (EUR)	165.7		157.6
United States Dollar (USD)	64.0		92.4
British Pound (GBP)	51.2		86.9
Danish Krone (DKK)	47.9		51.7
Swedish Krona (SEK)	35.8		42.0
Canadian Dollar (CAD)	31.1		41.3
Chinese Yuan (CNY)	16.7		20.9
Polish Zloty (PLZ)	15.3		21.5
Mexican Peso (MPX)	12.5		9.7
Switzerland Franc (CHF)	5.7		4.1
Norwegian Krone (NOK)	3.4		6.6
Romanian New Leu (RON)	2.8		2.3
Other	7.6		7.5
Total	$	810.9	$	1,257.2

The maximum term of ~~foreign~~our forward currency exchange fluctuations on expected future purchases and related payables denominated in a foreign currency, as well as to hedge the impact of foreign exchange fluctuations on expected future sales and related receivables denominated in a foreign currency. Both types of forward contracts ~~have a maximum maturity date of~~is 18 months. ~~The total notional amount for these contracts was $578.3 million and $533.5 million as of September 30, 2017 and December 31, 2016, respectively.~~

Effects of Derivatives on the Financial Statements

The below tables indicate the effects of all derivative instruments on the Condensed Consolidated Financial Statements. All amounts exclude income tax ~~effects and are presented in millions.~~effects.

The balance sheet location and gross fair value of our outstanding derivative instruments were as ~~follows:~~follows (in millions):


	Asset Derivatives						Asset Derivatives
	Balance Sheet Location	Fair Value					Fair Value
		September 30, 2017		December 31, 2016		Balance Sheet Location	June 27, 2020		December 31, 2019
Designated derivatives:
Foreign currency forward contracts	Other current assets	$	4.6	$	3.1	Prepaid expenses and other current assets	$	8.0	$	1.0
Cross-currency swap						Other non-current assets	8.0		26.3
Foreign currency forward contract NIH						Prepaid expenses and other current assets	0.4		—
Total designated derivatives							$	16.4	$	27.3
Non-designated derivatives:
Foreign currency forward contracts	Other current assets	$	8.5	$	0.7	Prepaid expenses and other current assets	$	6.1	$	3.3

~~Perrigo Company plc~~ ~~- Item 2~~

~~Financial Condition, Liquidity and Capital Resources~~

Cash Generated by (Used in) Operating Activities

Nine Months Ended
(in millions) October 1,
2016 September 30,
2017 Increase/(Decrease)
Cash Flows From (For) Operating Activities
Net income (loss) $ (2,653.7 ) $ 46.4
$ 2,700.1
Non-cash adjustments 3,229.9
560.8
(2,669.1 )
Subtotal 576.2
607.2
31.0

Increase (decrease) in cash due to:
Accounts receivable 113.0
38.4
(74.6 )
Inventories 25.1
(28.3 ) (53.4 )
Accounts payable (57.7 ) (6.0 ) 51.7
Payroll and related taxes (40.0 ) (36.7 ) 3.3
Accrued customer programs (73.7 ) (15.8 ) 57.9
Accrued liabilities (90.0 ) (18.8 ) 71.2
Accrued income taxes 5.2
(61.5 ) (66.7 )
Other, net (9.4 ) 3.5
12.9
Subtotal $ (127.5 ) $ (125.2 ) $ 2.3

Net cash from operating activities $ 448.7
$ 482.0

$ 33.3
The $304.4 million increase in operating cash inflow was due primarily to:

~~We generated $482.0~~$283.2 million ofincrease in cash from ~~operating activities during~~ the ~~nine months ended September 30, 2017, a $33.3~~change in accounts receivable, due primarily to timing of sales and receipt of payments;

$39.7 million increase ~~over~~in cash from the change in inventory, due primarily to the build-up of inventory at a lower level than in the prior year ~~period,~~to support customer demands, partially offset by higher inventory levels due to a reduction in sales for certain products;

$35.7 million increase in cash from the ~~following:~~

~~Increased~~change in net earnings after adjustments for items ~~such as~~including deferred income taxes, impairment charges, restructuring charges, changes in our financial assets, share-based compensation, amortization of debt premium, loss on ~~extinguishment~~sale of ~~debt,~~business, and depreciation and amortization;

~~Changes~~$23.9 million increase in cash from the change in accrued ~~liabilities~~income taxes, due ~~to deferred revenue associated with BCH-Belgium distribution contracts and the absence of accruals related~~primarily to the ~~sale~~CARES Act, which allowed the deferral of ~~our~~the U.S. ~~VMS business;~~federal and state tax payments from April 15th, 2020 to July 15th, 2020; and

~~Changes~~$20.9 million increase in cash from the change in accrued ~~customer-related~~customer programs, due primarily to timing of payments for contractual programs in our CSCA segment; partially offset by

$62.8 million decrease in cash from the ~~pricing dynamics in the~~ RX ~~segment; and~~

~~Changes~~change in accounts payable, due primarily to ~~changes to~~ the ~~Omega accounts payable structure that occurred~~timing of payments and mix of payment terms; and

$34.8 million decrease in cash from the ~~prior year period; offset primarily by~~

~~Changes~~change in ~~accounts receivable~~prepaid expenses, due primarily to ~~timing of receipt of~~an increase in our directors and officers prepaid insurance, payments made for annual prepaid expenses, and ~~the absence of receivables~~a payment made for a transitional service agreement, partially offset by payments received related to ~~the sale of~~ our ~~U.S. VMS business;~~cross currency swap.

~~Changes in inventory due to the build up of inventory levels to support customer demands in the current period; offset by improved inventory management in the comparable prior year period; and~~


•	~~Changes in accrued income taxes due primarily to a U.S. Federal tax obligation payment made in the current year period, offset by expected tax refunds (refer to~~ ~~Item 1. Note 13~~).

Perrigo Company plc - Item 2

Financial Condition, Liquidity and Capital Resources

Cash Generated by (Used in) Investing Activities

Nine Months Ended
($ in millions) October 1,
2016 September 30,
2017 Increase/(Decrease)
Cash Flows From (For) Investing Activities
Proceeds from royalty rights $ 259.5
$ 86.4
$ (173.1 )
Acquisitions of businesses, net of cash acquired (436.8 ) —
436.8
Asset acquisitions (65.1 ) —
65.1
Additions to property, plant and equipment (84.6 ) (55.2 ) 29.4
Net proceeds from sale of business and other assets 58.5
46.7
(11.8 )
Proceeds from sale of the Tysabri^® financial asset
—
2,200.0
2,200.0
Other investing, net (1.0 ) (5.8 ) (4.8 )
Net cash from (for) investing activities $ (269.5 ) $ 2,272.1
$ 2,541.6

~~Cash generated from~~The $183.7 million decrease in investing ~~activities totaled $2.3 billion for the nine months ended September 30, 2017, compared to~~ cash ~~used of $269.5 million in the prior year period. The inflow in the current year~~flow was due primarily ~~to the completed divestment of our Tysabri~~^® ~~financial asset to Royalty Pharma, for which we~~to:


•	$250.0 million decrease in cash due to the absence of the Royalty Pharma contingent milestone proceeds received ~~$2.2 billion in cash at closing (refer toItem 1. Note 6). The outflow~~ in the prior year period(refer to Item 1. Note 6);


•	$106.0 million decrease in cash for the acquisition of the oral care assets of High Ridge Brands (refer to Item 1. Note 3);


•	$15.0 million decrease in cash for the purchase of our equity method investment in Kazmira LLC (refer to Item 1. Note 7); and

$5.4 million decrease in cash due to the change in capital spending, primarily to increase tablet and infant formula capacity and for quality/regulation projects; partially offset by


•	$187.8 million increase in cash for the net proceeds from the divestiture of our Rosemont Pharmaceuticals business (refer to Item 1. Note 3); and

•

$2.2 million increase in cash due to the change in spending on asset acquisitions, primarily related to the purchase of the Steripod^®brand for $24.9 million and theDexsil^®brand for approximately $8.0 million, offset by prior year acquisitions, including that of an ANDA for a generic product used to relieve pain for $15.7 million, and Budesonide Nasal Spray and Triamcinolone Nasal Spray for $14.0 million (refer to Item 1. Note 3).

Cash Generated by (Used in) Financing Activities

The $488.6 million increase in financing cash flow was due primarily ~~to the acquisition of a portfolio of generic dosage forms and strengths of Retin-A~~^® ("Tretinoin"), a topical prescription acne treatment from Mattawan Pharmaceuticals, LLC, which used $416.4 million in cash. The prior year outflow was offset partially by proceeds from royalty rights of $259.5 million. Cash used for capital expenditures totaled $55.2 million during the nine months ended September 30, 2017 compared to $84.6 million in the prior year period. The decrease in cash used for capital expenditures was due primarily to the decrease in the number of projects in the current year compared to the prior year period.to:

~~Financing Activities~~

Nine Months Ended
($ in millions) October 1,
2016 September 30,
2017 Increase/(Decrease)
Cash Flows From (For) Financing Activities
Issuances of long-term debt $ 1,190.3
$ —
$ (1,190.3 )
Borrowings (repayments) of revolving credit agreements and other financing, net (803.6 ) —
803.6
Payments on long-term debt (545.8 ) (2,243.7 ) (1,697.9 )
Deferred financing fees (2.8 ) (4.2 ) (1.4 )
Premium on early debt retirement (0.6 ) (116.1 ) (115.5 )
Issuance of ordinary shares 8.2
0.5
(7.7 )
Repurchase of ordinary shares —
(191.5 ) (191.5 )
Cash dividends (62.4 ) (68.7 ) (6.3 )
Other financing (17.4 ) 2.7
20.1
Net cash (for) financing activities $ (234.1 ) $ (2,621.0 ) $ (2,386.9 )

Cash used for financing activities totaled $2.6 billion for the nine months ended September 30, 2017, compared to $234.1 million for the comparable prior year period. In the current year period, cash used for financing included $2.2 billion of repayments on long-term debt and $116.1 million of discounts on early debt retirement related to the current year debt extinguishment and $191.5 million in share repurchases, as discussed below. In the prior year period, the cash used for financing activities was due primarily to borrowings of $1.2 billion of long-term debt, more than offset by net repayments on our revolving credit agreements and other short-term financing of $803.6 million and net repayments on our long-term debt of $545.8 million (refer to "~~Borrowings and Capital Resources" below and~~ ~~Item 1. Note 10~~).

Perrigo Company plc - Item 2

Financial Condition, Liquidity and Capital Resources


•	$743.8 million for the issuance of long-term debt (refer to Item 1. Note 10); and

$158.9 million decrease in payments on long-term debt; partially offset by

$395.9 million decrease in net borrowings of revolving credit agreements and other financing;

$7.1 million increase in dividend payments; and

$5.0 million increase in deferred financing fees related to the issuance of long-term debt.

Dividends

The declaration and payment of dividends, if any, is subject to the discretion of our Board of Directors and will depend on our earnings, financial condition, availability of distributable reserves, capital and surplus requirements, and other factors our Board of Directors may consider relevant.

OnShare Repurchases

In October ~~22, 2015,~~2018, our Board of Directors authorized up to $1.0 billion of share repurchases with no expiration date, subject to the Board of ~~Directors approved a~~Directors’ approval of the pricing parameters and amount that may be repurchased under each specific share repurchase ~~plan of up to $2.0 billion (the "2015 Authorization"). During the three and nine months ended~~ ~~September 30, 2017, we repurchased 1.9 million and 2.7 million ordinary shares at an average repurchase price of $71.73 and $71.72 per share, for a total of $133.3 million and $191.5 million, respectively. As of~~ ~~September 30, 2017, there was $1.3 billion still available to be repurchased through December 31, 2018 under the 2015 Authorization.~~program. We did not repurchase any shares ~~under the share repurchase plan~~ during the ~~nine~~three and six months ended ~~October 1, 2016.~~June 27, 2020.

Borrowings and Capital Resources

Revolving Credit Agreements

On March 8, 2018, we entered into a $1.0 billion revolving credit agreement maturing on March 8, 2023 (the "2018 Revolver"). There were no borrowings outstanding under the 2018 Revolver as of June 27, 2020 or December 31, 2019.

Term Loans and Notes

On June 19, 2020, Perrigo Finance issued $750.0 million in aggregate principal amount of 3.150% Senior Notes due 2030 and received net proceeds of $737.1 million after fees and market discount. Interest on the 2020 Notes is payable semi-annually in arrears on June 15 and December 15 of each year, beginning on December 15, 2020. The 2020 Notes will mature on June 15, 2030. The 2020 Notes are governed by the 2020 Indenture. The 2020 Notes are fully and unconditionally guaranteed on a senior unsecured basis by Perrigo and, no other subsidiary of Perrigo guarantees the 2020 Notes. There are no restrictions under the 2020 Notes on Perrigo's ability to obtain funds from its subsidiaries. Perrigo Finance may redeem the 2020 Notes in whole or in part at any time for cash at the make-whole redemption prices described in the 2020 Indenture. On July 6, 2020, the net proceeds of the 2020 Notes were used to fund the redemption of Perrigo Finance's $280.4 million of 3.500% Senior Notes due March 15, 2021 and $309.6 million of 3.500% Senior Notes due December 15, 2021, both of which were classified as Current indebtedness on the Condensed Consolidated Balance Sheet as of June 27, 2020. The balance will be

Perrigo Company plc - Item 2

Financial Condition, Liquidity and Capital Resources

used for general corporate purposes which may include the repayment or redemption of additional indebtedness. In connection with the redemption, we incurred early redemption costs of $19.0 million, which will be included in Loss on extinguishment of debt on the Condensed Consolidated Statements of Operations in the third quarter of 2020.

On March 8, 2018, we refinanced the €350.0 million outstanding under the previous term loan with the proceeds of a new €350.0 million ($431.0 million) term loan, maturing on March 8, 2020 (the "2018 Term Loan"). During the three and six months ended June 29, 2019, we made $12.4 million and $24.7 million in scheduled principal repayments on the 2018 Term Loan. On August 15, 2019, we refinanced the €284.4 million ($317.1 million) outstanding under the 2018 Term Loan with the proceeds of a new $600.0 million term loan, maturing on August 15, 2022.

Other Financing

We incurred debt of $35.0 million related to our equity method investment with Kazmira pursuant to two Promissory Notes, with $4.0 million to be settled in November 2020, $6.0 million to be settled in May 2021, and the remaining balance of $25.0 million to be settled in November 2021 (refer to Item 1. Note 7).

Overdraft Facilities

We have overdraft facilities available that we use to support our cash management operations. ~~There were no balances~~The balance outstanding under the facilities ~~at September 30, 2017~~was $1.5 million as of June 27, 2020. There were no borrowings outstanding under the facilities as of December 31, 2019.

Leases

We had $166.3 million and $158.2 million of lease liabilities and $164.4 million and $157.5 million of lease assets as of June 27, 2020 and December 31, ~~2016.~~2019, respectively.

Accounts Receivable Factoring

We have multiple accounts receivable factoring arrangements with non-related third-party financial institutions (the “Factors”). Pursuant to the terms of the arrangements, we sell to the Factors certain of our accounts receivable balances on a non-recourse basis for credit approved accounts. An administrative fee ranging from 0.14% to 0.15% per invoice is charged on the gross amount of accounts receivables assigned to the Factors, and interest is calculated at the applicable EUR LIBOR rate plus 70 basis points. The total amount factored on a non-recourse basis and excluded from accounts receivable was ~~$24.3~~$16.1 million and ~~$50.7~~$10.0 million at ~~September 30, 2017 and~~ ~~December 31, 2016, respectively.~~

~~Revolving Credit Agreements~~

On December 9, 2015, our 100% owned finance subsidiary, Perrigo Finance Unlimited Company (formerly Perrigo Finance plc) ("Perrigo Finance"), entered into a $750.0 million revolving credit agreement (the "2015 Revolver"). On March 15, 2016, we used the proceeds of the long-term debt issuance described below to repay the $750.0 million then outstanding under the 2015 Revolver and terminated the facility.

On December 5, 2014, Perrigo Finance entered into a $600.0 million revolving credit agreement, which increased to $1.0 billion on March 30, 2015 (the "2014 Revolver"). On March 15, 2016, we used the proceeds of the long-term debt issuance described below to repay the $435.0 million then outstanding under the 2014 Revolver. There were no borrowings outstanding under the 2014 Revolver as of September 30, 2017.

~~Perrigo Company plc~~ ~~- Item 2~~

~~Financial Condition, Liquidity and Capital Resources~~

~~Term Loans and Notes~~

On March 7, 2016, Perrigo Finance issued $500.0 million in aggregate principal amount of 3.500% senior notes due 2021 and $700.0 million in aggregate principal amount of 4.375% senior notes due 2026 (together, the "2016 Notes") and received net proceeds of $1.2 billion after fees and market discount, which were used to repay the amounts outstanding under the 2015 Revolver and 2014 Revolver mentioned above.

~~We had $3.3 billion and $5.4 billion outstanding under our notes and bonds, and $428.3 million and $420.7 million outstanding under our term loan, as of September 30, 2017~~June 27, 2020 and December 31, ~~2016,~~2019, respectively. ~~On September 29, 2016, we repaid the 1.300% senior notes due 2016 in full.~~

On December 5, 2014, Perrigo Finance entered into a term loan agreement consisting of a €500.0 million ($614.3 million) tranche, with the ability to draw an additional €300.0 million ($368.6 million) tranche, maturing December 5, 2019, and we entered into a $300.0 million term loan tranche maturing December 18, 2015, which we repaid in full on June 25, 2015.

~~Debt Repayments~~

~~During the nine months ended September 30, 2017, we reduced our outstanding debt through a variety of transactions (in millions):~~

Date Series Transaction Type Principal Retired
April 1, 2017 2014 term loan due December 5, 2019 Scheduled quarterly payment $ 13.3
July 1, 2017 2014 term loan due December 5, 2019 Scheduled quarterly payment 14.3
September 30, 2017 2014 term loan due December 5, 2019 Scheduled quarterly payment 14.8
May 8, 2017 $600.0 2.300% senior notes due 2018 Early redemption 600.0
May 23, 2017 €180.0 4.500% retail bonds due 2017 Scheduled maturity 201.3
June 15, 2017 $500.0 3.500% senior notes due 2021 Tender offer 190.4
June 15, 2017 $500.0 3.500% senior notes due 2021 Tender offer 219.6
June 15, 2017 $800.0 4.000% senior notes due 2023 Tender offer 584.4
June 15, 2017 $400.0 5.300% senior notes due 2043 Tender offer 309.5
June 15, 2017 $400.0 4.900% senior notes due 2044 Tender offer 96.1
$ 2,243.7

As previously disclosed, during the three months ended April 1, 2017 we entered into amendments to the 2014 Revolver and the 2014 term loan to modify provisions of such agreements necessary as a result of the correction in accounting related to the Tysabri^® financial asset, as well as waivers of any default or event of default that may have arisen from any restatement of or deficiencies in our financial statements for the periods specified in such amendments and waivers. We are in compliance with all covenants under our debt agreements as of ~~September 30, 2017.~~

~~See~~ June 27, 2020 (refer to Item 1. Note 9 and Note 10 for more information on all of the above lease activity and debt ~~facilities.~~facilities, respectively).

Credit Ratings

Our credit ratings on ~~September 30, 2017~~June 27, 2020 were Baa3 (stable) and BBB- (stable) by Moody's Investors Service and ~~Standard and Poor's~~S&P Global Ratings, respectively.

Credit rating agencies review their ratings periodically and, therefore, the credit rating assigned to us by each agency may be subject to revision at any time. Accordingly, we are not able to predict whether current credit ratings will remain as disclosed above. Factors that can affect our credit ratings include changes in operating performance, the economic environment, our financial position, and changes in business strategy. If changes in our credit ratings were to occur, they could impact, among other things, future borrowing costs, access to capital markets, and vendor financing terms.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have a material current effect or that are reasonably likely to have a material future effect on our financial condition, changes in financial condition, net sales or expenses, results of operations, liquidity, capital expenditures, or capital resources. We acquire and collaborate on potential products still in development and enter into R&D arrangements with third parties that often require milestone payments to the third-party contingent upon the occurrence of certain future events linked to the success of the asset in development. Milestone payments may be required contingent upon the successful achievement of an important point in the development life cycle of the product. Because of the contingent nature of these payments, they are not included in our table of contractual obligations included in our 2019 Form 10-K and referred to below.

Perrigo Company plc - Item 2

Financial Condition, Liquidity and Capital Resources

Contractual Obligations and Commitments

Other than the obligations related to the changes toin our debt structure ~~in relation~~from the 2020 Notes and Promissory Notes related to ~~the repayments,~~our equity method investment with Kazmira, as discussed in Item 1. Note 10, there were no material changes in contractual obligations as of ~~September 30, 2017~~June 27, 2020 from those provided in our ~~2016~~2019 Form 10-K. ~~See below for~~Below is a revised schedule of our enforceable and legally binding obligations as of ~~September 30, 2017~~June 27, 2020 related to our short and long-term debt arrangements.

Payment Due by Period (in millions)

2017⁽¹⁾
2018 - 2019 2020 - 2021 After 2021 Total
Short and long-term debt⁽²⁾
$ 406.5
$ 811.5
$ 812.5
$ 2,859.6
$ 4,890.1



	Payment Due
	2020 ⁽²⁾		2021-2022		2023-2024		After 2024		Total
Short and long-term debt ⁽¹⁾	$	671.6	$	887.9	$	1,284.5	$	2,399.4	$	5,243.4

⁽¹⁾ Short-term and long-term debt includes interest payments, which were calculated using the effective interest rate at June 27, 2020.

(2) Reflects remaining ~~three~~six months of ~~2017.~~2020.


⁽²⁾	~~Short and long-term debt includes interest payments, which were calculated using the effective interest rate at September 30, 2017.~~

Significant Accounting Policies

Other than the adoption of ASU 2016-13 Financial Instruments - Credit Losses (refer to Item 1. Note 1) and ASU 2018-13 Fair Value Measurement Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement (refer to Item 1. Note 6), there have been no material changes to the accounting policies disclosed in our 2019 Form 10-K.

Critical Accounting Estimates

The determination of certain amounts in our financial statements requires the use of estimates. These estimates are based upon our historical experiences combined with management’s understanding of current facts and circumstances. Although the estimates are considered reasonable based on the currently available information, actual results could differ from the estimates we have used. Below are the updates regarding critical accounting estimates which required judgment in the preparation of our financial statements during the three and six months ended June 27, 2020. The below disclosures should be read in conjunction with our 2019 Form 10-K.

Change in Financial Assets

We valued our contingent milestone payments from Royalty Pharma using a modified Black-Scholes Option Pricing Model ("BSOPM"). Key inputs in the BSOPM are the estimated volatility and rate of return of royalties on global net sales of Tysabri^® that are received by Royalty Pharma until the contingent milestones are resolved. As of June 27, 2020, volatility and the estimated fair value of the milestones had a positive relationship such that higher volatility translates to a higher estimated fair value of the contingent milestone payments. Rate of return and the estimated fair value of the milestones had an inverse relationship, such that a lower rate of return correlates with a higher estimated fair value of the contingent milestone payments. We assess volatility and rate of return inputs quarterly by analyzing certain market volatility benchmarks and the risk associated with Royalty Pharma achieving the underlying projected royalties. The table below represents the volatility and rate of return:



	Three Months Ended
	June 27, 2020		June 29, 2019
Volatility	37.5	%	30.0	%
Rate of return	6.91	%	7.99	%

We also consider Biogen’s quarterly Tysabri earnings along with forecasts from third party analysts in our royalty projections. In our estimation process as of June 27, 2020, we considered risks associated with COVID-19 on Tysabri sales in 2020, including but not limited to, the potential for disruptions and delays in dosing of Tysabri in physician office and hospital settings. We will continue monitoring Tysabri earnings and the development of COVID-19 impacts in our quarterly valuation assessment. In order for us to receive the remaining contingent milestone payment of $400.0 million, Royalty Pharma payments from Biogen for Tysabri^® sales in 2020 must exceed $351.0 million. If Royalty Pharma payments from Biogen for Tysabri^® sales do not meet the prescribed

Perrigo Company plc - Item 2

Unallocated, Interest, Other, and Taxes

threshold in 2020, we will write off the $99.0 million asset and record a loss. If the prescribed threshold is exceeded, we will increase the asset to $400.0 million and recognize income of $301.0 million in Change in financial assets on the Condensed Consolidated Statements of Operations (refer to Item 1. Note 6).

Goodwill

Goodwill represents amounts paid for an acquisition in excess of the fair value of net assets received. After completing the divestiture of our Rosemont Pharmaceuticals business, we have five reporting units subject to impairment testing annually, which we perform on the first day of the fourth quarter of the fiscal year. We perform impairment testing more frequently if events suggest an impairment may exist. The test for impairment requires us to make several estimates about fair value, most of which are based on projected future cash flows and market valuation multiples. The estimates associated with the goodwill impairment tests are considered critical due to the judgments required in determining fair value amounts, including projected future cash flows that include assumptions about future performance. The discount rates used in testing each of our reporting units’ goodwill for impairment during our interim and annual testing are based on the weighted average cost of capital determined for each of our reporting units.

The discounted cash flow forecasts used for our reporting units include assumptions about future activity levels in the near term and longer-term. If growth in our reporting units is lower than expected, we may experience deterioration in our cash flow forecasts that may indicate goodwill in one or more reporting units is impaired in future impairment tests. An increase in the discount rate could negatively impact the estimated fair value of the reporting units and lead to a future impairment. Certain macroeconomic factors which are not controlled by the reporting units, such as rising inflation or interest rates, could cause an increase in the discount rate to occur. Deterioration in performance of our reporting units, such as lower than expected revenue or profitability that has a sustained impact on future periods, could also represent potential indicators of impairment requiring further impairment analysis.

We reviewed our reporting units for impairment indicators during the three months ended June 27, 2020. We evaluated the weighted average cost of capital, market multiples, and forecasted cash flows of each reporting unit, among other factors. Our BCS reporting unit had an indication of potential impairment driven by a decrease in forecasted cash flows in the second half of 2020 related to impacts from the COVID-19 pandemic. Goodwill remaining in this reporting unit was $961.0 million as of June 27, 2020. We prepared a quantitative analysis as of June 27, 2020 and determined that the fair value of the BCS reporting unit continued to exceed net book value by less than 10%. As a result of the relatively narrow margin between fair value and net book value during the three months ended June 27, 2020, this reporting unit is at risk for future impairments if it experiences deterioration in business performance or market multiples or increases in discount rates. We continue to monitor the progress of our reporting units and assess them for potential impairment should impairment indicators arise, as applicable, and at least annually during our fourth quarter impairment testing.

We performed sensitivity analysis on the discounted cash flow valuation that was prepared to estimate the enterprise value of the BCS reporting unit. Discount rates and perpetual revenue growth rates were increased and decreased by increments of 25 or 50 basis points. A 75 basis point increase in the discount rate, or a 50 basis point increase in the discount rate combined with a 25 basis point decrease in the residual growth rate, would indicate potential impairment for this reporting unit. Our sensitivities for the BCS reporting unit assume a corresponding decrease in market valuation multiples. Based on the sensitivity of the discount rate assumption on this analysis, an increase in the discount rate over the next twelve months could negatively impact the estimated fair value of the reporting unit and lead to a future impairment. Certain macroeconomic factors which are not controlled by the BCS reporting unit, such as rising inflation or interest rates, could cause an increase in the discount rate to occur. Deterioration in performance of the BCS reporting unit over the next twelve months, such as lower than expected revenue or profitability that has a sustained impact on future periods, could also represent potential indicators of impairment requiring further impairment analysis.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes to our quantitative or qualitative disclosures found in Item 7A, "Quantitative and Qualitative Disclosures about Market Risk," of our ~~Annual Report on~~2019 Form ~~10-K for the year ended December 31, 2016.~~10-K.

Perrigo Company plc - Item 4

Controls and Procedures

ITEM 4. CONTROLS AND PROCEDURES

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) or 15d-15(e) of the Exchange Act) as of ~~September 30, 2017.~~June 27, 2020. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures ~~were not~~are effective ~~as of September 30, 2017 because of the~~in ensuring that all material ~~weaknesses~~information relating to us and our consolidated subsidiaries required to be included in our ~~internal control over financial reporting described below.~~

~~All systems of internal control, no matter how well designed, have inherent limitations. Therefore, even~~periodic SEC filings would be made known to them by others within those systems deemed to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. A material weakness is a deficiency, or combination of deficiencies,entities in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of a company’s annual or interim consolidated financial statements will not be prevented or detected on a timely ~~basis.~~manner and that no changes are required at this time.

Evaluation of the Effectiveness of Internal Control over Financial Reporting

~~We conducted an evaluation of~~Our management assessed the effectiveness of our internal control over financial reporting ~~based upon the~~as of June 27, 2020. The framework ~~established~~used in carrying out our evaluation was the 2013 Internal Control - Integrated Framework ~~issued~~ published by the Committee of Sponsoring Organizations ("COSO") of the Treadway ~~Commission (“COSO”).~~

~~Perrigo Company plc~~ ~~- Item 4~~

~~Controls and Procedures~~

~~Tysabri~~^® ~~Contingent Payments~~

~~We acquired the Tysabri~~^® ~~royalty stream in~~Commission. In evaluating our ~~acquisition of Elan Pharmaceuticals plc (“Elan”) in December 2013, and at the time~~information technology controls, we also used components of the ~~acquisition,~~framework contained in the Control Objectives for Information and related Technology, which was developed by the Information Systems Audit and Control Association’s IT Governance Institute, as a complement to the COSO internal control framework. Management has concluded that the right to receive quarterly royalty payments from Biogen Idec Inc. should be an intangible asset and such payments recognized as revenue in our financial statements. As discussed in Item 4.02 of our Form 8-K filed on April 25, 2017, during the 2016 year-end close process, and in anticipation of our potential sale of the Tysabri^® ~~royalty rights and the 2018 adoption of ASC 606~~ ~~Revenue from Contracts with Customers, we re-evaluated the historical classification of the Tysabri~~^® royalty stream as an intangible asset and concluded that it should have been reflected in the financial statements as a financial asset as of its 2013 acquisition date. As part of this evaluation, management determined that its control over the review of the application of the accounting guidance in ASC 805 ~~Business Combinations~~ ~~did not operate effectively in the appropriate identification of the assets acquired and liabilities assumed in connection with the Elan acquisition in December 2013.~~All of our originally filed financial statements through the filing of the Form 10-Q for the quarter ended October 1, 2016, as originally filed on November 10, 2016, included the disclosure of the Elan acquisition with the Tysabri^® royalty stream presented as an intangible asset. In addition, due to the fact that the asset was historically classified as an intangible asset, we did not design or implement controls around the fair value accounting for the Tysabri^® royalty stream as a financial asset, so these controls were not in place at any quarter end subsequent to the acquisition, including the date of the quarterly and annual assessment of internal control. Accordingly, management concluded that these control deficiencies represent material weaknesses. As discussed in our Form 10-Q for the quarter ended July 1, 2017, the material weakness related to the fair value accounting for the Tysabri^® ~~royalty stream as a financial asset was remediated during that period. See below for our discussion of the remediation efforts related to our acquisition of the Tysabri~~^® ~~royalty rights.~~

~~Income Taxes~~

Management has determined that we did not design or maintain effective management review controls related to our (1) evaluation of non-routine transactions that impact our effective tax rate on an annual and interim basis and (2) determination of our deferred taxes in connection with business combinations.

During our quarterly and annual fiscal 2016 close processes, management determined that the design and operating effectiveness of our controls around the evaluation of non-routine events did not operate appropriately. As disclosed in our Form 10-Q for the quarterly period ended April 2, 2016, our management review controls did not operate at a sufficient level of precision to ensure interim income taxes were properly recorded and disclosed in our condensed consolidated financial statements in connection with the recording of an indefinite-lived intangible asset impairment and estimated goodwill impairment as part of the Company’s controls to evaluate non-routine events that occur during a quarterly period and the related income tax impacts. These control deficiencies resulted in a material misstatement in income taxes in the preliminary financial statements for the quarter ended April 2, 2016. Additionally, these controls remained unremediated as of September 30, 2017, as they were in February 2017 when we identified that these controls did not appropriately evaluate the need for a valuation allowance. ASC 740, ~~Income Taxes,~~ requires a company to record a valuation allowance to reduce a deferred tax asset to its net realizable value. Our controls related to consideration of non-routine transactions or events were not designed and did not operate appropriately and identify whether a valuation allowance was needed as they did not identify that we entered into a three year cumulative loss and did not consider the positive and negative evidence in evaluating the potential sources of taxable income in determining whether a valuation allowance was required in the consolidated financial statements.

In February 2017, management identified the existence of tax basis in certain acquired intangible assets (“tax amortization benefits”) that existed at the time of the acquisition of Omega Pharma Invest N.V. (“Omega”) on March 30, 2015. Upon evaluating the tax amortization benefits, management concluded that the purchase accounting for Omega should have included the tax basis in the intangible assets in calculating the deferred tax liability in the opening balance sheet. This omission of existing tax basis in calculating the deferred tax liability on the acquisition date indicated that management’s review over the opening balance sheet deferred income tax accounts was not designed or operating appropriately.

~~Accordingly, management concluded that these control deficiencies represent material weaknesses.~~

~~Perrigo Company plc~~ ~~- Item 4~~

~~Controls and Procedures~~

~~Impairment~~

~~In connection with our long-lived asset impairment testing, management determined that the controls around the identification of the relevant asset group under ASC 360,~~ ~~Impairment and Disposal of Long-lived Assets~~, did not operate effectively. In determining the level to evaluate the long-lived assets in our animal health reporting unit for impairment testing, we inappropriately grouped the assets that constituted the asset group in applying the guidance in ASC 360.

~~Accordingly, management concluded that this control deficiency represented a material weakness.~~

~~Remediation Plan for the Material Weaknesses~~

We are committed to remediating the control deficiencies that gave rise to the material weaknesses described above. Management is responsible for implementing changes and improvements to internal control over financial reporting and for remediating the control deficiencies that gave rise to the material weaknesses.

~~Tysabri~~^® ~~Contingent Payments~~

~~To remediate the material weakness related to the acquisition of the Tysabri~~^® royalty rights, we, with oversight from the Audit committee, designed certain controls around the identification of assets acquired and liabilities assumed in our business combination process. As part of the re-design of the controls, we: (1) considered our controls around the review of the related contracts and agreements and our application of ASC 805 to identify the type of assets acquired and liabilities assumed and (2) evaluated and enhanced management review controls related to business acquisitions. Based on the evaluation of the design and changes to our business acquisition process performed during the second and third quarters of 2017 on these newly implemented controls, we have concluded that these controls have been designed and implemented appropriately. As a result, we consider this material weakness to be remediated as of September 30, 2017.

~~Income Taxes~~

To remediate the material weaknesses in internal control over financial reporting related to income taxes, we have, with oversight from the Audit Committee, completed the review of the organizational structure, resources, processes and controls in place to measure and record income taxes to enhance the effectiveness of the design and operation of those controls. In addition, we continue to:

~~Evaluate the design and operating effectiveness of our controls related to income taxes for business acquisitions and non-routine transactions on an interim and annual basis;~~

~~Enhance monitoring activities related to income taxes; and~~

~~Evaluate and enhance the level of precision in the management review controls related to income taxes.~~

We have begun to implement the remediation actions and expect to complete the implementation as part of our 2017 fiscal year closing process. Until the remediation actions are fully implemented and the operational effectiveness of related internal controls is validated through testing, the material weaknesses related to income taxes described above will continue to exist.

~~Impairment~~

We, with oversight from the Audit Committee, designed and initiated certain controls around the financial reporting related to the identification of asset groups as part of our impairment testing. Controls we implemented include: (1) reviewing the design and operation of our controls related to asset group determination in our impairment process on an interim and annual basis and (2) evaluating and enhancing the management review controls related to impairment. Based on the testing performed during the second and third quarters of 2017 on these newly implemented controls around the identification of asset groups as part of our impairment testing, we have concluded that these controls have been designed appropriately and are operating effectively. As a result, we consider this material weakness to be remediated as of September 30, 2017.

~~Perrigo Company plc~~ ~~- Item 4~~

~~Controls and Procedures~~

~~We are committed to achieving and maintaining a strong internal control environment and believe the remediation measures will strengthen~~ our internal control over financial reporting ~~and remediate the material weaknesses identified. We continue to review the remaining un-remediated material weaknesses and intend to add resources and improve~~was effective as of June 27, 2020. The results of management’s assessment have been reviewed with our processes to achieve and maintain a strong control environment. We will continue to monitor the effectiveness of our remediation measures and will make any changes and take such other actions that we deem appropriate given the circumstances.Audit Committee.

Changes in Internal Control over Financial Reporting

~~Other than as described above under "Remediation Plan~~We acquired Ranir during the third quarter of 2019 and the oral care assets of High Ridge Brands during the second quarter of 2020 (refer to Item 1. Note 3). As permitted by Securities and Exchange Commission Staff interpretive guidance for ~~Material Weaknesses," there have been no changes in our~~newly acquired businesses, management excluded Ranir and the oral care asset of High Ridge Brands from its evaluation of internal control over financial reporting ~~during~~as of June 27, 2020. We are in the ~~three months ended September 30, 2017 that have materially affected, or are reasonably likely to materially affect,~~process of documenting and testing both Companies' internal controls over financial reporting. We will incorporate Ranir and the oral care assets of High Ridge Brands into our annual reports on internal control over financial ~~reporting.~~reporting for our years ending December 31, 2020 and December 31, 2021, respectively. As of June 27, 2020, assets excluded from management’s assessment totaled $999.0 million and contributed $158.0 million of Net sales and $5.5 million of Operating incomein our Condensed Consolidated Statements of Operations for the six months ended June 27, 2020.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Refer to ~~Part I,~~ Item 1. Note 13 and Item 1. Note 14 of the Notes to the Condensed Consolidated Financial Statements.

ITEM 1A. RISK FACTORS

Our Annual Report on Form 10-K for the year ended December 31, ~~2016~~2019 includes a detailed discussion of our risk factors. At the time of this filing, there have been no material changes to the risk factors that were included in the Form 10-K, other than as described below.

~~We identified material weaknesses in our internal controls over financial reporting; failure~~Adverse Economic Impacts of Coronavirus Pandemic

On March 11, 2020, the World Health Organization declared COVID-19 a global pandemic, as the new coronavirus, unknown to ~~remediate~~health officials just three months earlier, spread rapidly from Asia to the ~~material weaknesses could negatively impact our business~~Middle East, Europe, and the ~~price of our ordinary shares.~~

~~In connection with our review of certain material misstatements related~~United States. As the pandemic continues, many actions taken to reduce the ~~characterization~~spread of the ~~Tysabri~~^® ~~royalty stream acquired~~coronavirus remain in effect, including quarantines, government restrictions on movement, business closures and suspensions, canceled events and activities, self-isolation, and other voluntary and/or mandated changes in behavior. Both the ~~Elan transaction, as well as material misstatements related to the calculation of deferred tax liabilities that existed at the time~~outbreak of the ~~acquisition of Omega,~~disease and the evaluation of long-lived assets in our animal health reporting unit for impairment testing, in each case contained in certain of our historical financial statements, we concluded that there were material weaknesses in our internal control over financial reporting that contributed to those misstatements. As a result of the material weaknesses, which existed at December 31, 2016 and some of which remained at September 30, 2017, we have concluded that we did not maintain, in all material respects, effective internal control over financial reporting as of December 31, 2016, April 1, 2017, July 1, 2017 or September 30, 2017, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). The failure to maintain effective control over financial reporting in turn resulted in material deficiencies in our disclosure controls and procedures.

~~We have identified and begun the implementation of actions, and continue to identify and implement,~~ actions to ~~improve the effectiveness of our internal control over financial reporting and disclosure controls and procedures, but there can be no assurance that such remediation efforts will be successful. We~~slow its spread have also incurred and will continue to incur substantial accounting, legal, consulting, and other costs in connection with identifying and remediating the material weaknesses. Failure to remediate the material weaknesses could have a negativehad an adverse impact on our ~~business~~operations by, among other things, increasing absenteeism, affecting the supply of raw materials and ~~the market for our ordinary shares. For more information on our material weaknesses and the status of our remediation efforts, See~~ ~~Part I, Item 4 - Controls and Procedures~~.

We are currently involved in a search for a new Chief Executive Officer and a subsequent search for a permanent Chief Financial Officer. If these searches are delayed, our business could be negatively impacted.

On June 5, 2017, we announced the forthcoming retirement of John T. Hendrickson as our Chief Executive Officer. Mr. Hendrickson will continue to serve as our Chief Executive Officer and a member of our Board until such time as a successor has been appointed. Our Board of Directors has initiated a Chief Executive Officer search process and has retained an executive search and leadership advisory firm to assist with the process of identifying and evaluating candidates.third party

Perrigo Company plc - Item 1A

Risk Factors

~~In addition, on February 21, 2017, we announced the resignation of Judy L. Brown as our Executive Vice President, Business Operations~~supplied finished goods, and Chief Financial Officer, effective February 27, 2017. Since that time, Ronald L. Winowiecki has served as our acting Chief Financial Officer. Although Mr. Winowiecki remains a key candidate for our permanent Chief Financial Officer, our Board of Directors has suspended its Chief Financial Officer search during its search for Mr. Hendrickson’s successor as Chief Executive Officer. There are no assurances concerning the timing or outcomepreventing many of our ~~search for~~employees from coming to work. The Company has responded to such impacts by, among other things, implementing protocols to protect the health of factory workers, adjusting production schedules, and seeking alternate suppliers where available, and so far, most of our facilities have continued to produce at high levels despite these challenges. However, a number of jurisdictions that relaxed such restrictions, or have experienced limited public adherence with suggested safety measures, have experienced new ~~Chief Executive Officer~~surges in COVID-19 cases. Many of these jurisdictions are now contemplating or ~~subsequent search for a permanent Chief Financial Officer. If there are any delays in this process,~~implementing new or ~~if any transition is not successful, our business could be negatively impacted.~~

~~The resolution~~renewed restrictions. Going forward, the continued spread of ~~uncertain tax positions could be unfavorable, which~~the disease and the actions to slow it could have an adverse ~~effect~~impact on our ~~business.~~

~~Although we believe that~~financial condition, our ~~tax estimates are reasonable~~supply chains and ~~that~~other operations, our ~~tax filings are prepared in accordance with all applicable tax laws, the final determination with respect~~results of our operations, consumer demand for our products and our ability to access capital. The magnitude of any ~~tax audit and any related litigation~~such adverse impacts cannot currently be determined, but such adverse impacts could be ~~materially different~~material, depending on: the duration, intensity, and continued spread of the disease; the duration of business closure and similar government orders; the process by which government authorities permit businesses to reopen and employees to return to work and the publics willingness to adhere to suggested safety measures; the scale and timing of any additional waves of the outbreak as restrictions on community movement are relaxed; the severity of any economic downturn resulting from the pandemic; the effectiveness of the Company's efforts at mitigation; and other factors, both known and unknown, many of which are likely to be outside our ~~estimates or from~~control. In addition, to the extent that any increased sales of our ~~historical income tax provisions~~products during the initial stages of the outbreak may reflect "pantry stocking", consumer demand for such products in future periods may be correspondingly reduced. Further, lower consumer demand for certain other self-care products and ~~accruals. The results~~lower volume of ~~an audit or litigation could have~~U.S. dermatology prescriptions may continue in future periods. It is also possible that a ~~material effect on operating results or cash flows~~change in the course of the pandemic may affect consumer demand for products in future periods ~~for which that determination is made.~~ in ways we do not currently anticipate.

In ~~addition, future period earnings may be adversely impacted by litigation costs, settlements, penalties or interest assessments.~~

~~On August 15, 2017, we filed a complaint~~connection with delays in the ~~United States District Court for~~implementation of the ~~Western District~~EU's Medical Device Regulation due to the COVID-19 pandemic, the designation of ~~Michigan to recover $163.6 million~~a Notified Body certifying certain of ~~Federal income tax, penalties, and interest assessed and collected by the Internal Revenue Service (“IRS”), plus statutory interest thereon from the dates~~our products expired, which could adversely affect our sales of payment, for the fiscal years ended June 27, 2009, June 26, 2010, June 25, 2011, and June 30, 2012 (the “2009 tax year,” “2010 tax year,” “2011 tax year,” and “2012 tax year,” respectively). The IRS audits of those years culminated in the issuances of two statutory notices of deficiency: (1) on August 27, 2014 for the 2009 and 2010 tax years and (2) on April 20, 2017 for the 2011 and 2012 tax years. The statutory notices of deficiency both included un-agreed income adjustments related principally to transfer pricing adjustments regarding the purchase, distribution, and sale of store-brand OTC pharmaceuticalthese products in the ~~United States. In addition,~~EU.

We market certain products that are subject to the ~~statutory notice~~EU’s Medical Device Directive (“MDD”) and will be subject to the EU’s Medical Device Regulation (“MDR”), both of ~~deficiency for the 2011 and 2012 tax years included the capitalization~~which require that products be certified by designated assessment entities (“Notified Bodies”) prior to sale. The date of certain expenses that were deducted when paid or incurred in defending against certain patent infringement lawsuits. We fully paid the assessed amounts of tax, interest, and penalties set forth in the statutory notices and filed timely claims for refund on June 11, 2015 and June 7, 2017 for the 2009-2010 tax years and 2011-2012 tax years, respectively. Our claims for refund were disallowed by certified letters dated August 18, 2015 and July 11, 2017, for the 2009-2010 tax years and 2011-2012 tax years, respectively. The complaint was timely, based upon the refund claim denials, and seeks refunds of tax, interest, and penalties of $37.2 million for the 2009 tax year, $61.5 million for the 2010 tax year, $40.2 million for the 2011 tax year and $24.7 million for the 2012 tax year. The amounts sought in the complaint for the 2009 and 2010 tax years were recorded as deferred charges on our balance sheet during the three months ended March 28, 2015, and the amounts sought in the complaint for the 2011 and 2012 tax years were recorded as deferred charges on our balance sheet in the second quarterapplication of the ~~year ending December 31, 2017.~~

~~On December 22, 2016, we received~~MDR, and as a ~~notice~~result the date of ~~proposed adjustment for~~repeal of the IRS audit of Athena Neurosciences, Inc. (“Athena”), a subsidiary of Elan Corporation plc (“Elan”) acquired in 1996, for the years ended December 31, 2011, December 31, 2012 and December 31, 2013. We acquired Elan in December 2013. This proposed amendment relatesMDD, has been deferred by 12 months to May 26, 2021 due to the ~~deductibility~~pandemic. In connection with this extension, Notified Bodies designated under the prior MDD regime were allowed to continue their related governance of ~~litigation costs. We disagree~~medical devices for one additional year, until May 25, 2021, subject to them having a designation under MDD in place throughout this time. During this time, the MDD designation of a Notified Body that certifies certain products in our portfolio has expired. The current regulations are not clear on the treatment of the existing certificates granted by such a Notified Body during this period, and we have engaged in detailed discussions with the ~~IRS’s position asserted in the notice~~relevant authorities to enable continuity of ~~proposed adjustment and intend to contest it.~~

~~On July 11, 2017,~~supply. While we received a draft notice of proposed adjustment associated with transfer pricing positions for the IRS audit of Athena for the years ended December 31, 2011, December 31, 2012 and December 31, 2013. Athena was the originator of the patents associated with Tysabri^® prior to the acquisition of Athena by Elan in 1996. The amount of adjustments that may be asserted by the IRS in the final notice of proposed adjustment cannot be quantified at this time; however, based on the draft notice received, the amount to be assessed may be material. We disagree with the IRS’s position as asserted in the draft notice of proposed adjustment and intend to contest it.

~~Perrigo Company plc~~ ~~- Item 1A~~

~~Risk Factors~~

~~There are numerous other income tax jurisdictions for which tax returns are~~do not yet settled, none of which are individually significant. At this time, we cannot predict the outcome of any audit or related litigation. Unfavorable resolutions of the audit matters discussed above could haveexpect a material impact on our ~~consolidated financial statements~~business, there can be no assurances that our ability to sell these products in ~~future periods.~~the EU will not be interrupted, slowed or otherwise adversely affected.

~~ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS~~

~~Share repurchase activity during the three months ended September 30, 2017 was as follows:~~

Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans
Value of Shares Available for Purchase⁽¹⁾
July 2 - July 31, 2017 484,860
$ 72.27
484,860

August 1 - August 31, 2017 1,354,721
$ 71.46
1,354,721

September 1 - September 30, 2017 19,124
$ 77.50
19,124

Total 1,858,705
$ 1.30 billion

⁽¹⁾ ~~The remaining $1.30 billion in the table represents the amount available to be repurchased under our 2015 Authorization as of September 30, 2017.~~

~~ITEM 5. OTHER INFORMATION~~

Our Board of Directors has established May 4, 2018 as the date of our 2018 Annual General Meeting of Shareholders (the “2018 Annual Meeting”). Because the date of the 2018 Annual Meeting will be more than 30 days before the anniversary of our 2017 Annual General Meeting of Shareholders, we are informing shareholders of the change in accordance with Rule 14a-5(f) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

For shareholders who wish to present a proposal to be considered for inclusion in our proxy materials for the 2018 Annual Meeting, we have set a new deadline for the receipt of those proposals in accordance with Rule 14a-8 under the Exchange Act. To be considered timely, shareholders must submit their proposals, in writing, to our Company Secretary at our principal executive offices located at Treasury Building, Lower Grand Canal Street, Dublin 2, Ireland by December 19, 2017, which we have determined to be a reasonable time before we expect to begin to print and mail our proxy materials. Shareholder proposals must also comply with all applicable requirements of Rule 14a-8.

Because the 2018 Annual Meeting will be more than 30 days before the anniversary of the 2017 Annual General Meeting of Shareholders, our Articles of Association (the “Articles”) provide that shareholders who wish to bring a proposal or nominate a director at the 2018 Annual Meeting, but who are not requesting that the proposal or nomination be included in our proxy materials, must notify our Company Secretary, in writing, not earlier than the close of business on February 3, 2018 and not later than the close of business on February 23, 2018. Shareholders are advised to review the Articles, which contain additional requirements about advance notice of shareholder proposals and director nominations.

Perrigo Company plc ~~- Part II~~ - Item 6

Exhibits

ITEM 6. EXHIBITS



Exhibit Number		Description

3.1		Certificate of Incorporation of Perrigo Company plc (formerly known as Perrigo Company Limited) (incorporated by reference from Exhibit 4.1 to the Company’s Registration Statement on Form S-8 filed on December 19, 2013).

3.2		Memorandum and Articles of Association of Perrigo Company plc, as amended and restated (incorporated by reference from Exhibit 3.2 to the Company’s Quarterly Report on Form 10-Q filed on August 10, 2017).

4.1		Base Indenture dated as of December 2, 2014, between Perrigo Finance Unlimited Company, formerly known as Perrigo Finance plc, Perrigo Company plc and Wells Fargo Bank, National Association as Trustee (incorporated by reference from Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on December 2, 2014).

4.2		Third Supplemental Indenture, dated as of June 19, 2020, among the Issuer, the Company and Wells Fargo Bank, National Association, as trustee (incorporated by reference from Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on June 19, 2020).

4.3		Form of 3.150% Note due 2030 (incorporated by reference from Exhibit A to the Third Supplemental Indenture, filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed on June 19, 2020).

10.1		~~Letter Agreement between~~ Perrigo Company ~~plc and Ronald L. Winowiecki, dated July 18, 2017~~Employee Severance Programme - Ireland, effective April 9, 2020 (incorporated by reference from Exhibit 10.1 to the Company’s ~~Current~~Quarterly Report on Form ~~8-K~~10-Q filed on ~~July 21, 2017)~~May 5, 2020).

~~10.2~~		~~Amendment No. 3 to the 2013 Long-Term Incentive Plan, effective as of November 3,2017 (filed herewith).~~

~~10.3~~		~~Forms of Service-Based Restricted Stock Unit Award Agreements under the Company's 2013 Long-Term Incentive Plan (filed herewith).~~

~~10.4~~		~~Forms of Performance-Based Restricted Stock Unit Award Agreements under the Company's 2013 Long-Term Incentive Plan (filed herewith).~~

~~10.5~~		~~Forms of Nonqualified Stock Option Agreements under the Company's 2013 Long-Term Incentive Plan filed (herewith).~~

31.1		Rule 13a-14(a) Certification by ~~John T. Hendrickson,~~Murray S. Kessler, Chief Executive Officer (filed herewith).

31.2		Rule 13a-14(a) Certification by ~~Ronald L. Winowiecki, Acting~~Raymond P. Silcock, Chief Financial Officer (filed herewith).

32		Certification Pursuant to 18 United States Code 1350 and Rule 13a-14(b) of the Securities Exchange Act of 1934 (furnished herewith).

~~101.INS~~101. INS		XBRL Instance ~~Document.~~Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.

101.SCH		XBRL Taxonomy Extension Schema Document.

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB		XBRL Taxonomy Extension Label Linkbase Document.

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document.

104		Cover Page Interactive Date File, formatted in Inline XBRL (contained in Exhibit 101).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



		PERRIGO COMPANY PLC
		(Registrant)

Date:	~~November 9, 2017~~August 5, 2020	~~By: /s/ John T. Hendrickson~~/s/ Murray S. Kessler
		~~John T. Hendrickson~~Murray S. Kessler
		Chief Executive Officer and President
		(Principal Executive Officer)

Date:	~~November 9, 2017~~August 5, 2020	~~By: /s/ Ronald L. Winowiecki~~/s/ Raymond P. Silcock
		~~Ronald L. Winowiecki~~Raymond P. Silcock
		~~Acting~~ Chief Financial Officer
		(Principal Accounting and Financial Officer)

5968



	Three Months Ended						Six Months Ended
	June 27, 2020			June 29, 2019			June 27, 2020			June 29, 2019
Net sales	$	1,219.1		$	1,149.0		$	2,560.1		$	2,323.5
Cost of sales	784.4			718.2			1,642.2			1,443.9
Gross profit	434.7			430.8			917.9			879.6

Operating expenses
Distribution	23.6			23.7			47.8			47.1
Research and development	47.1			43.9			89.0			84.0
Selling	127.6			140.1			275.3			288.7
Administration	118.8			127.2			241.4			252.3
Impairment charges	—			27.8			—			31.9
Restructuring	1.1			12.2			1.1			21.5
Other operating expense (income)	(0.9		)	0.9			0.2			(3.2		)
Total operating expenses	317.3			375.8			654.8			722.3

Operating income	117.4			55.0			263.1			157.3

Change in financial assets	(2.1		)	(5.5		)	(3.7		)	(15.9		)
Interest expense, net	33.4			31.2			63.6			59.8
Other (income) expense, net	14.3			2.3			16.7			5.5
Income before income taxes	71.8			27.0			186.5			107.9
Income tax expense	11.2			18.0			19.5			35.0
Net income	$	60.6		$	9.0		$	167.0		$	72.9

Earnings per share
Basic	$	0.44		$	0.07		$	1.23		$	0.54
Diluted	$	0.44		$	0.07		$	1.22		$	0.54

Weighted-average shares outstanding
Basic	136.4			136.0			136.3			136.0
Diluted	137.5			136.5			137.3			136.3



	Three Months Ended						Nine Months Ended
	September 30, 2017			October 1, 2016			September 30, 2017			October 1, 2016
Net sales	$	1,231.3		$	1,261.6		$	3,663.1		$	3,949.3
Cost of sales	733.5			777.1			2,196.4			2,385.2
Gross profit	497.8			484.5			1,466.7			1,564.1

Operating expenses
Distribution	21.5			21.6			64.2			65.9
Research and development	38.4			50.2			120.8			142.5
Selling	143.5			154.6			454.1			506.9
Administration	123.3			105.4			326.9			317.2
Impairment charges	7.8			1,614.4			47.4			2,028.8
Restructuring	3.8			6.6			54.7			17.9
Other operating income	(2.9		)	—			(41.0		)	—
Total operating expenses	335.4			1,952.8			1,027.1			3,079.2

Operating income (loss)	162.4			(1,468.3		)	439.6			(1,515.1		)

Change in financial assets	2.6			377.4			24.2			1,492.6
Interest expense, net	34.7			54.6			133.1			163.2
Other (income) expense, net	(3.6		)	1.0			(1.1		)	32.4
Loss on extinguishment of debt	—			0.7			135.2			1.1
Income (loss) before income taxes	128.7			(1,902.0		)	148.2			(3,204.4		)
Income tax expense (benefit)	84.2			(311.8		)	101.8			(550.7		)
Net income (loss)	$	44.5		$	(1,590.2	)	$	46.4		$	(2,653.7	)

Earnings (loss) per share
Basic	0.31			(11.10		)	$	0.33		$	(18.53	)
Diluted	$	0.31		$	(11.10	)	$	0.32		$	(18.53	)

Weighted-average shares outstanding
Basic	141.3			143.3			142.5			143.2
Diluted	141.7			143.3			142.8			143.2

Dividends declared per share	$	0.160		$	0.145		$	0.480		$	0.435



	Three Months Ended						Nine Months Ended
	September 30, 2017			October 1, 2016			September 30, 2017			October 1, 2016
Net income (loss)	$	44.5		$	(1,590.2	)	$	46.4		$	(2,653.7	)
Other comprehensive income:
Foreign currency translation adjustments	69.9			27.5			289.9			71.5
Change in fair value of derivative financial instruments, net of tax	0.1			3.6			8.7			(3.5		)
Change in fair value of investment securities, net of tax	(8.1		)	9.8			(24.4		)	18.4
Change in post-retirement and pension liability, net of tax	(1.2		)	(0.2		)	(1.2		)	0.4
Other comprehensive income, net of tax	60.7			40.7			273.0			86.8
Comprehensive income (loss)	$	105.2		$	(1,549.5	)	$	319.4		$	(2,566.9	)



	Three Months Ended					Six Months Ended
	June 27, 2020			June 29, 2019		June 27, 2020			June 29, 2019
Net income	$	60.6		$	9.0	$	167.0		$	72.9
Other comprehensive income (loss):
Foreign currency translation adjustments	86.7			27.8		(5.5		)	11.0
Change in fair value of derivative financial instruments, net of tax	(0.7		)	2.7		(10.1		)	4.4
Change in post-retirement and pension liability, net of tax	(1.2		)	—		(3.1		)	(0.5		)
Other comprehensive income (loss), net of tax	84.8			30.5		(18.7		)	14.9
Comprehensive income	$	145.4		$	39.5	$	148.3		$	87.8


	September 30, 2017			December 31, 2016			June 27, 2020			December 31, 2019
Assets
Cash and cash equivalents	$	775.9		$	622.3		$	1,456.3		$	354.3
Accounts receivable, net of allowance for doubtful accounts of $6.2 million and $6.3 million, respectively	1,076.6			1,176.0
Accounts receivable, net of allowance for credit losses of $6.2 and $6.7, respectively							1,001.2			1,243.2
Inventories	821.9			795.0			1,034.7			967.3
Prepaid expenses and other current assets	297.4			212.0			311.3			165.8
Total current assets	2,971.8			2,805.3			3,803.5			2,730.6
Property, plant and equipment, net	822.3			870.1			892.3			902.8
Financial assets	—			2,350.0
Goodwill and other indefinite-lived intangible assets	4,255.4			4,163.9
Other intangible assets, net	3,347.4			3,396.8
Non-current deferred income taxes	22.4			72.1
Operating lease assets							136.7			129.9
Goodwill and indefinite-lived intangible assets							4,046.5			4,185.5
Definite-lived intangible assets, net							2,879.8			2,921.2
Deferred income taxes							7.2			5.4
Other non-current assets	423.3			211.9			362.3			426.0
Total non-current assets	8,870.8			11,064.8			8,324.8			8,570.8
Total assets	$	11,842.6		$	13,870.1		$	12,128.3		$	11,301.4
Liabilities and Shareholders’ Equity
Accounts payable	$	477.1		$	471.7		$	489.1		$	520.2
Payroll and related taxes	133.4			115.8			135.0			156.4
Accrued customer programs	368.8			380.3			364.5			394.4
Accrued liabilities	274.6			263.3
Other accrued liabilities							240.6			229.2
Accrued income taxes	61.5			32.4			24.0			32.2
Current indebtedness	417.1			572.8			606.5			3.4
Total current liabilities	1,732.5			1,836.3			1,859.7			1,335.8
Long-term debt, less current portion	3,275.7			5,224.5			3,536.0			3,365.8
Non-current deferred income taxes	357.7			389.9
Deferred income taxes							291.6			280.6
Other non-current liabilities	434.9			461.8			530.1			515.1
Total non-current liabilities	4,068.3			6,076.2			4,357.7			4,161.5
Total liabilities	5,800.8			7,912.5			6,217.4			5,497.3
Commitments and contingencies - Note 14
Commitments and contingencies - Refer to Note 14
Shareholders’ equity
Controlling interest:
Preferred shares, $0.0001 par value, 10 million shares authorized	—			—
Ordinary shares, €0.001 par value, 10 billion shares authorized	7,900.1			8,135.0
Accumulated other comprehensive income (loss)	191.2			(81.8		)
Controlling interests:
Preferred shares, $0.0001 par value per share, 10 shares authorized							—			—
Ordinary shares, €0.001 par value per share, 10,000 shares authorized							7,318.2			7,359.9
Accumulated other comprehensive income							120.7			139.4
Retained earnings (accumulated deficit)	(2,049.6		)	(2,095.1		)	(1,528.5		)	(1,695.5		)
Total controlling interest	6,041.7			5,958.1
Total controlling interests							5,910.4			5,803.8
Noncontrolling interest	0.1			(0.5		)	0.5			0.3
Total shareholders’ equity	6,041.8			5,957.6			5,910.9			5,804.1
Total liabilities and shareholders' equity	$	11,842.6		$	13,870.1		$	12,128.3		$	11,301.4

Supplemental Disclosures of Balance Sheet Information
Ordinary shares, issued and outstanding (in millions)	140.8			143.4
Preferred shares, issued and outstanding							—			—
Ordinary shares, issued and outstanding							136.5			136.1



	Ordinary Shares Issued					Accumulated Other Comprehensive Income			Retained Earnings (Accumulated Deficit)			Total
	Shares		Amount			Accumulated Other Comprehensive Income			Retained Earnings (Accumulated Deficit)			Total
Balance at December 31, 2018	135.9		$	7,421.7		$	84.6		$	(1,838.3	)	$	5,668.0
Adoption of new accounting standards	—		—			—			(3.4		)	(3.4		)
Net income	—		—			—			63.9			63.9
Other comprehensive loss	—		—			(15.6		)	—			(15.6		)
Restricted stock plan	0.2		—			—			—			—
Compensation for stock options	—		1.8			—			—			1.8
Compensation for restricted stock	—		14.2			—			—			14.2
Cash dividends, $0.19 per share	—		(25.9		)	—			—			(25.9		)
Shares withheld for payment of employees' withholding tax liability	(0.1	)	(2.4		)	—			—			(2.4		)
Balance at March 30, 2019	136.0		$	7,409.4		$	69.0		$	(1,777.8	)	$	5,700.6

Net income	—		—			—			9.0			9.0
Other comprehensive income	—		—			30.5			—			30.5
Stock options exercised	—		0.3			—			—			0.3
Compensation for stock options	—		1.3			—			—			1.3
Compensation for restricted stock	—		14.2			—			—			14.2
Cash dividends, $0.21 per share	—		(28.9		)	—			—			(28.9		)
Shares withheld for payment of employees' withholding tax liability	—		(0.8		)	—			—			(0.8		)
Balance at June 29, 2019	136.0		$	7,395.5		$	99.5		$	(1,768.8	)	$	5,726.2


•	Consumer Self-Care Americas ("CSCA") comprises our consumer self-care business (OTC, contract manufacturing, infant formula, and oral self-care categories and our divested animal health category) in the U.S., Mexico and Canada.


•	Consumer Self-Care International ("CSCI") comprises our branded consumer self-care business primarily in Europe, our consumer self-care businesses in the United Kingdom and Australia, and our divested liquid licensed products business in the United Kingdom.


•	Prescription Pharmaceuticals ("RX") comprises our prescription pharmaceuticals business in the U.S., predominantly generics, and our pharmaceuticals and diagnostic businesses in Israel.



~~Recently Issued Accounting Standards Adopted~~
~~Standard~~	~~Description~~	~~Date of adoption~~	~~Effect on the Financial Statements or Other Significant Matters~~
~~Clarifying the Definition of a Business~~	This update clarifies the definition of a business and addresses whether transactions should be accounted for as asset acquisitions or business combinations (or divestitures). The guidance includes an initial threshold that an acquired set of assets will not be considered a business if substantially all of the fair value of the assets acquired is concentrated in a single tangible or identifiable intangible asset (or group of similar assets). If the acquired set does not pass the initial threshold, then the guidance requires that, to be a business, the set must include an input and a substantive process that together significantly contribute to the ability to create outputs. Different factors are considered to determine whether the set includes a substantive process, such as the inclusion of an organized workforce. Further, the guidance removes language stating that a business need not include all of the inputs and processes that the seller used in operating the business.	~~January 1, 2017~~	We early adopted this new standard and will apply it prospectively when determining whether transactions should be accounted for as asset acquisitions (divestitures) or business combinations (divestitures). During the nine months ended September 30, 2017, we applied the new guidance when determining whether certain product divestitures represented sales of assets or businesses.
~~Improvements to Employee Share-Based Payment Accounting~~	This guidance is intended to simplify several aspects of the accounting for share-based payment award transactions. It will require all income tax effects of awards to be recorded through the income statement when the awards vest or settle as opposed to certain amounts being recorded in additional paid-in capital. An entity will also have to elect whether to account for forfeitures as they occur or by estimating the number of awards expected to be forfeited and adjusting the estimate when it is likely to change (as currently required). The guidance will also increase the amount an employer can withhold to cover income taxes on awards.	~~January 1, 2017~~	We adopted this standard as of January 1, 2017. We elected to estimate the number of awards expected to be forfeited and adjust the estimate when it is likely to change, consistent with past practice. We did not change the amounts that we withhold to cover income taxes on awards. As the requirement to record all income tax effects of vested or settled awards through the income statement is prospective in nature, there was no cumulative effect of adopting the standard on our balance sheet.



Recently Issued Accounting Standards Not Yet Adopted
Standard	Description	Effective Date	Effect on the Financial Statements or Other Significant Matters
~~Revenue from Contracts with Customers~~ASU 2018-14: Compensation-Retirement Benefits-Defined Benefit Plans-General (Subtopic 715-20): Disclosure Framework-Changes to the Disclosure Requirements for Defined Benefit Plans	~~The core principle~~This guidance amends ASC 715 to add, remove, and clarify disclosure requirements related to defined benefit pension and other post-retirement plans.	December 31, 2020	We are currently evaluating the implications of adoption to related disclosures in our Consolidated Financial Statements.
ASU 2019-12: Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes	This guidance enhances and simplifies various aspects of the income tax accounting guidance ~~is that an entity should recognize revenue to depict the transfer of promised goods or services to customers~~ in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: identify the contract(s) with a customer; identify the performance obligations in the contract; determine the transaction price; allocate the transaction price to the performance obligations in the contract; and recognize revenue when (or as) the entity satisfies a performance obligation. This guidance allows for two adoption methods, full retrospective approach or modified retrospective approach.ASC 740.	January 1, ~~2018~~	We continue to evaluate the implications of adoption of the new revenue standard on our Consolidated Financial Statements. We have completed an initial assessment and are in the process of quantifying the adoption impact, if any, related to certain topics identified through our evaluation process. Our assessment of the new revenue standard has been focused on, but has not been limited to, the concepts of over-time versus point-in-time revenue recognition patterns, variable consideration, and identification of performance obligations. We will not complete our final assessment and quantification of the impact of the new revenue standard on our Consolidated Financial Statements until the adoption date. Our analysis indicates that certain contract manufacturing and private label arrangements may require revenue recognition over-time in situations in which we produce products that have no alternative use and we have an enforceable right to payment for performance completed to date, inclusive of a reasonable profit margin. This may result in an acceleration of revenue recognition for certain contractual arrangements as compared to recognition under current accounting literature. We plan to adopt the new revenue standard effective January 1, 2018 using the modified retrospective method.
~~Intra-Entity Asset Transfers of Assets Other Than Inventory~~	Under the new guidance, the tax impact to the seller on the profit from the transfers and the buyer’s deferred tax benefit on the increased tax basis would be recognized when the transfers occur, resulting in the recognition of expense sooner than under historical guidance. The guidance excludes intra-entity transfers of inventory. For intra-entity transfers of inventory, the Financial Accounting Standards Board ("FASB") decided to retain current GAAP, which requires an entity to recognize the income tax consequences when the inventory has been sold to an outside party.	~~January 1, 2018~~2021	We are currently evaluating the implications of adoption on our Consolidated Financial Statements.
~~Financial Instruments - Recognition and Measurement of Financial Assets and Liabilities~~	The objective of this simplification update is to improve the decision usefulness of financial instrument reporting, and it principally affects accounting for equity investments currently classified as available for sale and financial liabilities where the fair value option has been elected. Entities will have to measure many equity investments at fair value and recognize changes in fair value in net income rather than other comprehensive income as required under current U.S. GAAP.	~~January 1, 2018~~	We have identified certain investments that will require an adjustment, however, at this time, we are unable to estimate the impact of adopting this standard as the significance of the impact will depend upon our equity investments as of the date of adoption.



~~Recently Issued Accounting Standards Not Yet Adopted (continued)~~(2)	Consists primarily of diagnostic products and other miscellaneous or otherwise uncategorized product lines and markets, none of which is greater than 10% of the segment net sales.


~~Standard~~(3)	~~Description~~	~~Effective Date~~	~~Effect on the Financial Statements~~Consists primarily of liquid licensed products, our distribution business and other miscellaneous or ~~Other Significant Matters~~
~~Leases~~	~~This guidance was issued to increase transparency~~otherwise uncategorized product lines and ~~comparability among organizations by requiring recognition~~markets, none of lease assets and lease liabilities on the balance sheet and disclosure of key information about leasing arrangements. For leases with a term of 12 months or less, lessees are permitted to make an election to not recognize right-of-use assets and lease liabilities. Upon adoption, lessees will apply the new standard aswhich is greater than 10% of the beginning of the earliest comparative period presented in the financial statements, however lessees will be able to exclude leases that expire as of the implementation date. Early adoption is permitted.	~~January 1, 2019~~	We are currently evaluating the implications of adoption on our Consolidated Financial Statements and have commenced the first step of identifying a task force to take the lead in implementing the new Lease standard.
~~Derivatives and Hedging~~	This update was issued to enable entities to better portray the economics of their risk management activities in the financial statements and enhance the transparency and understandability of hedge results. In addition, the amendments simplify the application of hedge accounting in certain situations. Under the new rule, the entity’s ability to hedge non-financial and financial risk components is expanded. The guidance eliminates the requirement to separately measure and report hedge ineffectiveness and also eases certain documentation and assessment requirements. Early adoption is permitted.	~~January 1, 2019~~	~~We are currently evaluating the implications of adoption on our Consolidated Financial Statements.~~
~~Measurement of Credit Losses on Financial Instruments~~	This guidance changes the impairment model for most financial assets and certain other instruments, replacing the current "incurred loss" approach with an "expected loss" credit impairment model, which will apply to most financial assets measured at amortized cost and certain other instruments, including trade and other receivables, loans, held-to-maturity debt securities, and off-balance sheet credit exposures such as letters of credit. Early adoption is permitted.	~~January 1, 2020~~	~~We are currently evaluating the new standard for potential impacts on our receivables, debt, and other financial instruments.~~
~~Intangibles - Goodwill and Other Simplifying the Test for Goodwill~~	The objective of this update is to reduce the cost and complexity of subsequent goodwill accounting by simplifying the impairment test by removing the Step 2 requirement to perform a hypothetical purchase price allocation when the carrying value of a reporting unit exceeds its fair value. If a reporting unit’s carrying value exceeds its fair value, an entity would record an impairment charge based on that difference, limited to the amount of goodwill attributed to that reporting unit. The proposal would not change the guidance on completing Step 1 of the goodwill impairment test. The proposed guidance would be applied prospectively. Early adoption is permitted.	~~January 1, 2020~~	~~We are currently evaluating the implications of adoption on our Consolidated Financial Statements.~~ segment net sales.



	Oral Care Assets of High Ridge Brands
Cash consideration	$	106.0

Estimated fair value of assets acquired and liabilities assumed:
Net working capital	$	22.2
Property, plant and equipment, net	0.7
Definite-lived intangible assets	66.8
Goodwill	16.3
Net assets acquired	$	106.0



	Ranir
Purchase price paid	$	759.2

Assets acquired:
Cash and cash equivalents	$	11.5
Accounts receivable	40.6
Inventories	59.0
Prepaid expenses and other current assets	4.0
Property, plant and equipment, net	40.8
Operating lease assets	3.7
Goodwill	292.7
Definite-lived intangibles:
Developed product technology, formulations, and product rights	$	48.6
Customer relationships and distribution networks	260.0
Trademarks, trade names, and brands	41.0
Indefinite-lived intangibles:
In-process research and development	39.7
Total intangible assets	$	389.3
Other non-current assets	2.8
Total assets	$	844.4
Liabilities assumed:
Accounts payable	$	17.6
Other accrued liabilities	7.7
Payroll and related taxes	5.5
Accrued customer programs	5.7
Deferred income taxes	45.9
Other non-current liabilities	2.8
Total liabilities	$	85.2
Net assets acquired	$	759.2



	Three Months Ended				Six Months Ended
	June 27, 2020		June 29, 2019		June 27, 2020		June 29, 2019
CSCA⁽¹⁾
Upper respiratory	$	116.7	$	121.2	$	271.3	$	254.0
Digestive health	112.1		106.3		219.0		208.6
Pain and sleep-aids	97.7		91.3		218.1		182.6
Nutrition	88.6		85.9		190.8		185.5
Healthy lifestyle	81.5		86.1		167.3		162.1
Oral self-care	63.2		—		118.5		—
Skincare and personal hygiene	42.9		45.8		89.6		91.3
Vitamins, minerals, and supplements	6.4		6.2		12.8		12.5
Animal health	—		22.3		—		41.9
Other CSCA⁽²⁾	18.5		17.0		40.8		25.4
Total CSCA	627.6		582.1		1,328.2		1,163.9
CSCI
Skincare and personal hygiene	97.6		105.7		192.3		207.6
Upper respiratory	45.5		49.9		129.6		121.8
Healthy lifestyle	40.5		48.7		84.1		96.0
Pain and sleep-aids	40.2		39.4		87.0		79.8
Vitamins, minerals, and supplements	38.5		41.1		87.0		86.9
Oral self-care	20.4		1.8		43.6		3.4
Digestive health	5.1		6.8		11.1		14.0
Other CSCI⁽³⁾	33.3		34.1		69.1		68.8
Total CSCI	321.1		327.5		703.8		678.3
RX	270.4		239.4		528.1		481.3
Total net sales	$	1,219.1	$	1,149.0	$	2,560.1	$	2,323.5



Reporting Segments:	December 31, 2016		Business divestitures			Re-class to assets held-for-sale			Currency translation adjustment		September 30, 2017
CHCA	$	1,810.6	$	—		$	—		$	2.9	$	1,813.5
CHCI	1,070.8		(4.1		)	—			122.3		1,189.0
RX	1,086.6		—			—			6.5		1,093.1
Other	81.4		—			(32.6		)	7.6		56.4
Total goodwill	$	4,049.4	$	(4.1	)	$	(32.6	)	$	139.3	$	4,152.0


~~Level 1:~~	~~Quoted prices for identical instruments in active markets.~~



	Three Months Ended				Six Months Ended
(Unaudited)	June 27, 2020		June 29, 2019		June 27, 2020		June 29, 2019
Net sales	$	1,219.1	$	1,239.6	$	2,589.7	$	2,515.5
Net income	$	63.8	$	4.3	$	173.1	$	72.7



	December 31, 2019		Purchase accounting adjustments			Business acquisitions		Business divestitures			Currency translation adjustments			June 27, 2020
CSCA	$	1,899.1	$	(10.4	)	$	14.6	$	—		$	(4.1	)	$	1,899.2
CSCI⁽¹⁾	1,203.7		12.0			1.7		(115.6		)	(11.3		)	1,090.5
RX⁽²⁾	1,013.9		—			—		—			0.6			1,014.5
Total goodwill	$	4,116.7	$	1.6		16.3		$	(115.6	)	$	(14.8	)	$	4,004.2



	June 27, 2020				December 31, 2019
	Gross		Accumulated Amortization		Gross		Accumulated Amortization
Indefinite-lived intangibles:
Trademarks, trade names, and brands	$	3.8	$	—	$	18.8	$	—
In-process research and development	38.5		—		50.0		—
Total indefinite-lived intangibles	$	42.3	$	—	$	68.8	$	—
Definite-lived intangibles:
Distribution and license agreements and supply agreements	$	133.4	$	81.1	$	126.7	$	81.1
Developed product technology, formulations, and product rights	1,306.9		709.1		1,392.8		755.3
Customer relationships and distribution networks	1,821.0		727.7		1,805.6		671.4
Trademarks, trade names, and brands	1,421.9		285.7		1,353.5		250.1
Non-compete agreements	5.1		4.9		6.5		6.0
Total definite-lived intangibles	$	4,688.3	$	1,808.5	$	4,685.1	$	1,763.9
Total intangible assets	$	4,730.6	$	1,808.5	$	4,753.9	$	1,763.9



	September 30, 2017				December 31, 2016
	Gross		Accumulated Amortization		Gross		Accumulated Amortization
Definite-lived intangibles:
Distribution and license agreements, supply agreements	$	310.2	$	157.5	$	305.6	$	120.4
Developed product technology, formulations, and product rights	1,355.4		568.8		1,418.1		526.0
Customer relationships and distribution networks	1,623.7		424.5		1,489.9		307.5
Trademarks, trade names, and brands	1,317.5		111.0		1,189.3		55.3
Non-compete agreements	14.7		12.3		14.3		11.2
Total definite-lived intangibles	$	4,621.5	$	1,274.1	$	4,417.2	$	1,020.4
Indefinite-lived intangibles:
Trademarks, trade names, and brands	$	52.0	$	—	$	50.5	$	—
In-process research and development	51.4		—		64.0		—
Total indefinite-lived intangibles	103.4		—		114.5		—
Total other intangible assets	$	4,724.9	$	1,274.1	$	4,531.7	$	1,020.4



	June 27, 2020		December 31, 2019
Finished goods	$	569.8	$	530.3
Work in process	196.7		186.9
Raw materials	268.2		250.1
Total inventories	$	1,034.7	$	967.3


~~Level 2:~~	Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets.


~~Level 3:~~	~~Valuations derived from valuation techniques in which one or more significant inputs are not observable.~~



		Fair Value
	Fair Value Hierarchy	September 30, 2017		December 31, 2016
Measured at fair value on a recurring basis:
Assets:
Investment securities	Level 1	$	6.1	$	38.2

Foreign currency forward contracts	Level 2	$	13.1	$	3.8
Funds associated with Israeli severance liability	Level 2	16.1		15.9
Total level 2 assets		$	29.2	$	19.7

Royalty Pharma contingent milestone payments	Level 3	$	143.2	$	—
Financial assets	Level 3	—		2,350.0
Total level 3 assets		$	143.2	$	2,350.0

Liabilities:
Foreign currency forward contracts	Level 2	$	3.3	$	5.0

Contingent consideration	Level 3	$	44.9	$	69.9

Measured at fair value on a non-recurring basis:
Assets:
Goodwill⁽¹⁾	Level 3	$	—	$	1,148.4
Indefinite-lived intangible assets⁽²⁾	Level 3	13.3		0.3
Definite-lived intangible assets⁽³⁾	Level 3	11.5		758.0
Assets held for sale, net	Level 3	95.1		18.2
Total level 3 assets		$	119.9	$	1,924.9


⁽¹⁾	~~As of~~During the year ended December 31, ~~2016,~~2019, goodwill with a carrying amount of ~~$2.2 billion~~$1,122.3 million was written down to ~~its implied~~a fair value of ~~$1.1 billion.~~$1,013.1 million.


⁽²⁾	~~As of September 30, 2017, indefinite-lived~~During the year ended December 31, 2019, definite-lived intangible assets with a carrying amount of ~~$26.0~~$55.3 million were written down to a fair value of ~~$13.3 million. As of December 31, 2016, indefinite-lived intangible assets with a carrying amount of $0.7 million were written down to a fair value of $0.3~~$23.3 million.



			Six Months Ended
			June 27, 2020
	Valuation Technique	Unobservable Input	Range (Weighted Average)⁽¹⁾
Contingent consideration payments: sales-based milestones	Discounted cash flow	Projected royalties	$	37.0
		Projected year of payment of sales-based milestones	2021 - 2036 (2027)
		Discount rate	26.0		%



	Year Ended
	December 31, 2016
	Omega - Lifestyle	Omega - XLS	Entocort^®- Branded Products	Entocort^®- AG Products	Herron Trade Names and Trademarks
5-year average growth rate	2.5%	3.2%	(31.7)%	(30.4)%	4.6%
Long-term growth rates	2.0%	NA	(10.0)%	(4.7)%	2.5%
Discount rate	9.3%	9.5%	13.0%	10.5%	10.8%
Royalty rate	NA	4.0%	NA	NA	11.0%
Valuation method	MPEEM	Relief from Royalty	MPEEM	MPEEM	Relief from Royalty



	September 30, 2017			December 31, 2016
Equity securities, at cost less impairments	$	15.5		$	16.5
Gross unrealized gains	—			21.7
Gross unrealized losses	(9.4		)	—
Estimated fair value of equity securities	$	6.1		$	38.2



		Liability Derivatives
		Fair Value
	Balance Sheet Location	June 27, 2020		December 31, 2019
Designated derivatives:
Foreign currency forward contracts	Other accrued liabilities	$	1.9	$	4.7
Non-designated derivatives:
Foreign currency forward contracts	Other accrued liabilities	$	1.1	$	3.7


	Amount of Gain/(Loss) Recorded in OCI (Effective Portion)									Six Months Ended
	Three Months Ended				Nine Months Ended					June 27, 2020
Designated Cash Flow Hedges	September 30, 2017		October 1, 2016		September 30, 2017		October 1, 2016
Instrument										Amount of Gain/(Loss) Recorded in OCI⁽¹⁾			Classification of Gain/(Loss) Reclassified from AOCI into Earnings	Amount of Gain/(Loss) Reclassified from AOCI into Earnings			Classification of Gain/(Loss) Recognized into Earnings Related to Amounts Excluded from Effectiveness Testing	Amount of Gain/(Loss) Recognized in Earnings on Derivatives Related to Amounts Excluded from Effectiveness Testing
Cash flow hedges:
Treasury locks										$	—		Interest expense, net	$	(0.1	)	Interest expense, net	$	—
Interest rate swap agreements	$	—	$	—	$	—	$	(9.0	)	—			Interest expense, net	(0.9		)	Interest expense, net	—
Foreign currency forward contracts	1.1		3.4		6.3		4.7			9.9			Net sales	—			Net sales	—
Total	$	1.1	$	3.4	$	6.3	$	(4.3	)
													Cost of sales	(0.8		)	Cost of sales	0.7
										$	9.9			$	(1.8	)		$	0.7
Net investment hedges:
Cross-currency swap										$	(18.3	)					Interest expense, net	$	4.6
Foreign currency forward contract NIH										0.4								—
										$	(17.9	)						$	4.6



	Three Months Ended
	June 29, 2019
Instrument	Amount of Gain/(Loss) Recorded in OCI		Classification of Gain/(Loss) Reclassified from AOCI into Earnings	Amount of Gain/(Loss) Reclassified from AOCI into Earnings			Classification of Gain/(Loss) Recognized into Earnings Related to Amounts Excluded from Effectiveness Testing	Amount of Gain/(Loss) Recognized in Earnings on Derivatives Related to Amounts Excluded from Effectiveness Testing
Cash flow hedges:
Interest rate swap agreements	$	—	Interest expense, net	$	(0.4	)	Interest expense, net	$	—
Foreign currency forward contracts	1.1		Net sales	0.1			Net sales	0.1
			Cost of sales	(0.2		)	Cost of sales	(1.1		)
	$	1.1		$	(0.5	)		$	(1.0	)



		Amount of Gain/(Loss) Recognized against Earnings (Ineffective Portion)
		Three Months Ended				Nine Months Ended
Designated Cash Flow Hedges	Income Statement Location	September 30, 2017		October 1, 2016		September 30, 2017		October 1, 2016
Interest rate swap agreements	Other (income) expense, net	$	—	$	—	$	—	$	(0.1	)
Foreign currency forward contracts	Net sales	0.2		—		0.1		0.1
	Cost of sales	0.1		—		0.1		—
	Other (income) expense, net	—		—		1.0		0.6
Total		$	0.3	$	—	$	1.2	$	0.6



		Three Months Ended						Six Months Ended
Non-Designated Derivatives	Income Statement Location	June 27, 2020			June 29, 2019			June 27, 2020			June 29, 2019
Foreign currency forward contracts	Other (income) expense, net	$	(17.1	)	$	(4.3	)	$	(6.0	)	$	(13.1	)
	Interest expense, net	2.2			1.4			3.8			1.8
		$	(14.9	)	$	(2.9	)	$	(2.2	)	$	(11.3	)



Liabilities	Balance Sheet Location	June 27, 2020		December 31, 2019
Current
Operating	Other accrued liabilities	$	32.0	$	32.0
Finance	Current indebtedness	5.8		3.4
Non-Current
Operating	Other non-current liabilities	109.5		101.7
Finance	Long-term debt, less current portion	19.0		21.1
Total		$	166.3	$	158.2



	Operating Leases		Finance Leases		Total
2020	$	19.3	$	2.4	$	21.7
2021	31.0		6.1		37.1
2022	23.9		3.4		27.3
2023	18.2		1.9		20.1
2024	15.8		1.4		17.2
After 2024	52.2		14.3		66.5
Total lease payments	160.4		29.5		189.9
Less: Interest	18.9		4.7		23.6
Present value of lease liabilities	$	141.5	$	24.8	$	166.3