Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2020 | Oct. 30, 2020 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-36326 | |
Entity Registrant Name | Endo International plc | |
Entity Incorporation, State or Country Code | L2 | |
Entity Tax Identification Number | 68-0683755 | |
Entity Address, Address Line One | First Floor, Minerva House, Simmonscourt Road | |
Entity Address, City or Town | Ballsbridge, Dublin 4, | |
Entity Address, Country | IE | |
Entity Address, Postal Zip Code | Not Applicable | |
City Area Code | 353 | |
Local Phone Number | 1-268-2000 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Title of 12(b) Security | Ordinary shares, nominal value $0.0001 per share | |
Trading Symbol | ENDP | |
Security Exchange Name | NASDAQ | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0001593034 | |
Current Fiscal Year End Date | --12-31 | |
Entity Ordinary Shares Outstanding (in shares) | 230,292,329 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 1,679,738 | $ 1,454,531 |
Restricted cash and cash equivalents | 162,648 | 247,457 |
Accounts receivable, net | 473,368 | 467,953 |
Inventories, net | 354,903 | 327,865 |
Prepaid expenses and other current assets | 66,206 | 40,845 |
Income taxes receivable | 65,957 | 47,567 |
Total current assets | 2,802,820 | 2,586,218 |
PROPERTY, PLANT AND EQUIPMENT, NET | 487,691 | 504,865 |
OPERATING LEASE ASSETS | 38,927 | 51,700 |
GOODWILL | 3,560,011 | 3,595,184 |
OTHER INTANGIBLES, NET | 2,178,862 | 2,571,267 |
DEFERRED INCOME TAXES | 2,192 | 2,192 |
OTHER ASSETS | 94,740 | 78,101 |
TOTAL ASSETS | 9,165,243 | 9,389,527 |
CURRENT LIABILITIES: | ||
Accounts payable and accrued expenses | 868,404 | 899,949 |
Current portion of legal settlement accrual | 374,754 | 513,005 |
Current portion of operating lease liabilities | 11,449 | 10,763 |
Current portion of long-term debt | 34,150 | 34,150 |
Income taxes payable | 2,241 | 2,422 |
Total current liabilities | 1,290,998 | 1,460,289 |
DEFERRED INCOME TAXES | 26,930 | 31,703 |
LONG-TERM DEBT, LESS CURRENT PORTION, NET | 8,286,351 | 8,359,899 |
OPERATING LEASE LIABILITIES, LESS CURRENT PORTION | 40,222 | 48,299 |
OTHER LIABILITIES | 303,224 | 355,881 |
COMMITMENTS AND CONTINGENCIES (NOTE 13) | ||
SHAREHOLDERS' DEFICIT: | ||
Euro deferred shares, $0.01 par value; 4,000,000 shares authorized and issued at both September 30, 2020 and December 31, 2019 | 47 | 45 |
Ordinary shares, $0.0001 par value; 1,000,000,000 shares authorized; 230,288,796 and 226,802,609 shares issued and outstanding at September 30, 2020 and December 31, 2019, respectively | 23 | 23 |
Additional paid-in capital | 8,930,209 | 8,904,692 |
Accumulated deficit | (9,487,613) | (9,552,214) |
Accumulated other comprehensive loss | (225,148) | (219,090) |
Total equity | (782,482) | (866,544) |
TOTAL LIABILITIES AND SHAREHOLDERS' DEFICIT | $ 9,165,243 | $ 9,389,527 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - $ / shares | Sep. 30, 2020 | Dec. 31, 2019 |
SHAREHOLDERS' DEFICIT: | ||
Euro deferred shares, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Euro deferred shares, shares authorized (in shares) | 4,000,000 | 4,000,000 |
Euro deferred shares, shares issued (in shares) | 4,000,000 | 4,000,000 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 230,288,796 | 230,288,796 |
Common stock, shares outstanding (in shares) | 226,802,609 | 226,802,609 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Statement [Abstract] | ||||
TOTAL REVENUES, NET | $ 634,860 | $ 729,426 | $ 2,142,853 | $ 2,149,564 |
COSTS AND EXPENSES: | ||||
Cost of revenues | 348,077 | 389,165 | 1,072,972 | 1,169,282 |
Selling, general and administrative | 182,259 | 168,329 | 522,285 | 471,749 |
Research and development | 32,055 | 36,519 | 94,165 | 96,353 |
Litigation-related and other contingencies, net | 1,810 | (14,414) | (23,938) | (4,093) |
Asset impairment charges | 8,412 | 4,766 | 106,197 | 258,652 |
Acquisition-related and integration items, net | (1,407) | 16,025 | 17,100 | (26,983) |
Interest expense, net | 135,648 | 136,903 | 397,689 | 404,387 |
Gain on extinguishment of debt | 0 | 0 | 0 | (119,828) |
Other (income) expense, net | (7,194) | 16,203 | (25,318) | 20,408 |
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAX | (64,800) | (24,070) | (18,299) | (120,363) |
INCOME TAX EXPENSE (BENEFIT) | 4,174 | 17,361 | (124,516) | 31,732 |
(LOSS) INCOME FROM CONTINUING OPERATIONS | (68,974) | (41,431) | 106,217 | (152,095) |
DISCONTINUED OPERATIONS, NET OF TAX (NOTE 3) | (6,913) | (37,984) | (41,616) | (51,898) |
NET (LOSS) INCOME | $ (75,887) | $ (79,415) | $ 64,601 | $ (203,993) |
NET (LOSS) INCOME PER SHARE—BASIC: | ||||
Continuing operations (in dollars per share) | $ (0.30) | $ (0.18) | $ 0.46 | $ (0.67) |
Discontinued operations (in dollars per share) | (0.03) | (0.17) | (0.18) | (0.23) |
Basic (in dollars per share) | (0.33) | (0.35) | 0.28 | (0.90) |
NET (LOSS) INCOME PER SHARE—DILUTED: | ||||
Continuing operations (in dollars per share) | (0.30) | (0.18) | 0.46 | (0.67) |
Discontinued operations (in dollars per share) | (0.03) | (0.17) | (0.18) | (0.23) |
Diluted (in dollars per share) | $ (0.33) | $ (0.35) | $ 0.28 | $ (0.90) |
WEIGHTED AVERAGE SHARES: | ||||
Basic (in shares) | 230,040 | 226,598 | 228,985 | 225,804 |
Diluted (in shares) | 230,040 | 226,598 | 233,379 | 225,804 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME (UNAUDITED) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Statement of Comprehensive Income [Abstract] | ||||
NET (LOSS) INCOME | $ (75,887) | $ (79,415) | $ 64,601 | $ (203,993) |
OTHER COMPREHENSIVE INCOME (LOSS): | ||||
Net unrealized gain (loss) on foreign currency | 2,755 | (2,515) | (6,058) | 6,610 |
Total other comprehensive income (loss) | 2,755 | (2,515) | (6,058) | 6,610 |
COMPREHENSIVE (LOSS) INCOME | $ (73,132) | $ (81,930) | $ 58,543 | $ (197,383) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
OPERATING ACTIVITIES: | ||
Net income (loss) | $ 64,601 | $ (203,993) |
Adjustments to reconcile Net income (loss) to Net cash provided by operating activities: | ||
Depreciation and amortization | 391,463 | 468,409 |
Share-based compensation | 33,452 | 48,909 |
Amortization of debt issuance costs and discount | 12,058 | 13,799 |
Deferred income taxes | (4,147) | (2,452) |
Change in fair value of contingent consideration | 17,100 | (26,983) |
Gain on extinguishment of debt | 0 | (119,828) |
Asset impairment charges | 106,197 | 258,652 |
Gain on sale of business and other assets | (16,730) | (3,101) |
Changes in assets and liabilities which (used) provided cash: | ||
Accounts receivable | (8,631) | 58,630 |
Inventories | (33,062) | (32,761) |
Prepaid and other assets | (18,455) | 15,577 |
Accounts payable, accrued expenses and other liabilities | (147,176) | (378,547) |
Income taxes payable/receivable, net | (107,227) | 22,933 |
Net cash provided by operating activities | 289,443 | 119,244 |
INVESTING ACTIVITIES: | ||
Purchases of property, plant and equipment, excluding capitalized interest | (52,692) | (47,812) |
Capitalized interest payments | (1,915) | (3,207) |
Product acquisition costs and license fees | (2,000) | 0 |
Proceeds from sale of business and other assets, net | 6,377 | 4,780 |
Other investing activities | 0 | 912 |
Net cash used in investing activities | (50,230) | (45,327) |
FINANCING ACTIVITIES: | ||
Proceeds from issuance of notes, net | 0 | 1,483,125 |
Repayments of notes | (57,649) | (1,501,788) |
Repayments of term loans | (25,612) | (25,614) |
Proceeds from draw of revolving debt | 0 | 300,000 |
Repayments of other indebtedness | (3,626) | (7,826) |
Payments for debt issuance and extinguishment costs | 0 | (6,414) |
Payments for contingent consideration | (3,535) | (11,846) |
Payments of tax withholding for restricted shares | (7,935) | (10,077) |
Proceeds from exercise of options | 0 | 4 |
Net cash (used in) provided by financing activities | (98,357) | 219,564 |
Effect of foreign exchange rate | (458) | 780 |
NET INCREASE IN CASH, CASH EQUIVALENTS, RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS | 140,398 | 294,261 |
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS, BEGINNING OF PERIOD | 1,720,388 | 1,476,837 |
CASH, CASH EQUIVALENTS, RESTRICTED CASH AND RESTRICTED CASH EQUIVALENTS, END OF PERIOD | 1,860,786 | 1,771,098 |
SUPPLEMENTAL INFORMATION: | ||
Cash paid into Qualified Settlement Funds for mesh legal settlements | 0 | 185,745 |
Cash paid out of Qualified Settlement Funds for mesh legal settlements | 107,225 | 266,958 |
Other cash distributions for mesh legal settlements | $ 26,559 | $ 13,334 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | NOTE 1. BASIS OF PRESENTATION Endo International plc is an Ireland-domiciled specialty pharmaceutical company that conducts business through its operating subsidiaries. Unless otherwise indicated or required by the context, references throughout to “Endo,” the “Company,” “we,” “our” or “us” refer to Endo International plc and its subsidiaries. The accompanying unaudited Condensed Consolidated Financial Statements of Endo International plc and its subsidiaries have been prepared in accordance with United States (U.S.) generally accepted accounting principles (U.S. GAAP) for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X of the SEC for interim financial information. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. In the opinion of management, the accompanying Condensed Consolidated Financial Statements of Endo International plc and its subsidiaries, which are unaudited, include all normal and recurring adjustments necessary for a fair statement of the Company’s financial position as of September 30, 2020 and the results of its operations and its cash flows for the periods presented. Operating results for the three and nine months ended September 30, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. The year-end Condensed Consolidated Balance Sheet data as of December 31, 2019 was derived from audited financial statements but does not include all disclosures required by U.S. GAAP. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with our Consolidated Financial Statements and accompanying notes included in the Annual Report. Certain prior period amounts have been reclassified to conform to the current period presentation. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Changes and Error Corrections [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Use of Estimates The preparation of our Condensed Consolidated Financial Statements in conformity with U.S. GAAP requires us to make estimates that affect the amounts and disclosures in the Condensed Consolidated Financial Statements, including the notes thereto, and elsewhere in this report. Uncertainties related to the continued magnitude and duration of the COVID-19 pandemic, the extent to which it will impact our estimated future financial results, worldwide macroeconomic conditions including interest rates, employment rates, consumer spending, health insurance coverage, the speed of the anticipated recovery and governmental and business reactions to the pandemic, including any possible re-initiation of shutdowns or renewed restrictions, have increased the complexity of developing these estimates, including the allowance for expected credit losses and the carrying amounts of long-lived assets, goodwill and other intangible assets. Actual results may differ significantly from our estimates, including as a result of COVID-19. Significant Accounting Policies Added or Updated since December 31, 2019 Significant changes to our significant accounting policies since December 31, 2019 are detailed below. For additional discussion of the Company’s significant accounting policies, see Note 2. Summary of Significant Accounting Policies in the Consolidated Financial Statements, included in Part IV, Item 15 of the Annual Report. Accounts Receivable. The Company adopted Accounting Standards Codification (ASC) Topic 326, Financial Instruments-Credit Losses (ASC 326) on January 1, 2020. For further discussion of the adoption, refer to the “Recent Accounting Pronouncements Adopted or Otherwise Effective as of September 30, 2020” section below. Subsequent to the adoption of ASC 326, our accounts receivable balance is stated at amortized cost less an allowance for expected credit losses. In addition, our accounts receivable balance is reduced by certain sales deduction reserves where we have the right of offset with the customer. We generally do not require collateral. Concentrations of Credit Risk and Credit Losses. Financial instruments that potentially subject us to significant concentrations of credit risk consist primarily of cash equivalents, restricted cash equivalents and accounts receivable. From time to time, we invest our excess cash in high-quality, liquid money market instruments maintained by major banks and financial institutions. We have not experienced any losses on our cash equivalents. With respect to our accounts receivable, we have no history of significant losses. Approximately 90% and 88% of our gross trade accounts receivable balances represent amounts due from three customers (Cardinal Health, Inc., McKesson Corporation and AmerisourceBergen Corporation) at September 30, 2020 and December 31, 2019, respectively. We perform ongoing credit evaluations of these and our other customers based on information available to us. We consider these and other factors, including changes in the composition and aging of our accounts receivable, in developing our allowance for expected credit losses. The estimated allowance was not material to the Company’s Condensed Consolidated Financial Statements at September 30, 2020 or December 31, 2019, nor were the changes to the allowance during any of the periods presented. We do not currently expect our current or future exposures to credit losses to have a significant impact on us. However, our customers’ ability to pay us on a timely basis, or at all, could be affected by factors specific to their respective businesses and/or by economic conditions, including those related to the COVID-19 pandemic, the extent of which cannot be fully predicted. Recent Accounting Pronouncements Adopted or Otherwise Effective as of September 30, 2020 In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-13, Measurement of Credit Losses on Financial Instruments (ASU 2016-13). ASU 2016-13, together with a series of subsequently-issued related ASUs, has been codified in ASC 326. ASC 326 establishes new requirements for companies to estimate expected credit losses when measuring certain financial assets, including accounts receivable. The Company adopted ASC 326 using a modified retrospective approach with an effective date of January 1, 2020. The adoption of ASC 326 did not have a material impact on the Company’s Condensed Consolidated Financial Statements. |
Discontinued Operations
Discontinued Operations | 9 Months Ended |
Sep. 30, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | NOTE 3. DISCONTINUED OPERATIONS Astora The operating results of the Company’s Astora business, which the Company’s board of directors (the Board) resolved to wind-down in 2016, are reported as Discontinued operations, net of tax in the Condensed Consolidated Statements of Operations for all periods presented. The following table provides the operating results of Astora Discontinued operations, net of tax, for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Litigation-related and other contingencies, net $ — $ 30,000 $ 28,351 $ 30,400 Loss from discontinued operations before income taxes $ (7,134) $ (37,984) $ (47,158) $ (51,898) Income tax benefit $ (221) $ — $ (5,542) $ — Discontinued operations, net of tax $ (6,913) $ (37,984) $ (41,616) $ (51,898) Loss from discontinued operations before income taxes includes Litigation-related and other contingencies, net, mesh-related legal defense costs and certain other items. The cash flows from discontinued operating activities related to Astora included the impact of net losses of $41.6 million and $51.9 million for the nine months ended September 30, 2020 and 2019, respectively, and the impact of cash activity related to vaginal mesh cases. There were no material net cash flows related to Astora discontinued investing activities during the nine months ended September 30, 2020 or 2019. There was no depreciation or amortization during the nine months ended September 30, 2020 or 2019 related to Astora. |
Restructuring
Restructuring | 9 Months Ended |
Sep. 30, 2020 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING | NOTE 4. RESTRUCTURING Restructuring charges related to nonretirement postemployment benefits that fall under Accounting Standards Codification Topic 712, Compensation—Nonretirement Postemployment Benefits (ASC 712) are recognized when the severance liability is determined to be probable of being paid and reasonably estimable. One-time benefits related to restructurings, if any, are recognized in accordance with Accounting Standards Codification Topic 420, Exit or Disposal Cost Obligations (ASC 420) when the programs are approved, the affected employees are identified, the terms of the arrangement are established, it is determined changes to the plan are unlikely to occur and the arrangements are communicated to employees. Other restructuring costs are generally expensed as incurred. Set forth below are disclosures relating to restructuring initiatives that resulted in material expenses or cash expenditures during the three- or nine-month periods ended September 30, 2020 and 2019 or had material restructuring liabilities at either September 30, 2020 or December 31, 2019. 2020 Restructuring Initiative On November 5, 2020, the Company announced the initiation of several strategic actions to further optimize the Company’s operations and increase overall efficiency (the 2020 Restructuring Initiative). These actions are expected to generate significant cost savings that will be reinvested, among other things, to support the Company’s key strategic priority to expand and enhance its product portfolio. These actions include the following: • Optimizing the Company’s generic retail business cost structure by exiting manufacturing sites in Irvine, California and Chestnut Ridge, New York, as well as active pharmaceutical ingredient manufacturing and bioequivalence study sites in India. The sites will be exited in a phased approach that is expected to be completed in the second half of 2022. Certain products currently manufactured at the Irvine and Chestnut Ridge sites are expected to be transferred to other internal and external sites within the Company’s manufacturing network. • Improving operating flexibility and reducing general and administrative costs by transferring certain transaction processing activities to third-party global business process service providers. • Increasing organizational effectiveness by further integrating the Company’s commercial, operations and research and development functions, respectively, to support the Company’s key strategic priorities. As a result of the 2020 Restructuring Initiative, the Company’s global workforce is expected to be reduced by approximately 560 net full-time positions. The Company expects to realize annualized pre-tax cash savings (without giving effect to the costs described below) of approximately $85 million to $95 million by the first half of 2023, primarily related to reductions in Cost of revenues of approximately $65 million to $70 million and other expenses, including Selling, general and administrative and Research and development expenses, of approximately $20 million to $25 million. As a result of the 2020 Restructuring Initiative, the Company expects to incur total pre-tax restructuring-related expenses of approximately $163 million to $183 million, of which approximately $125 million to $140 million relates to the Generic Pharmaceuticals segment, with the remaining amounts relating to our other segments and certain corporate unallocated costs. These estimated restructuring charges consist of accelerated depreciation charges of approximately $56 million to $66 million, asset impairment charges of approximately $7 million, employee separation, continuity and other benefit-related costs of approximately $85 million to $90 million and certain other restructuring costs of approximately $15 million to $20 million. Cash outlays associated with the 2020 Restructuring Initiative are expected to be approximately $100 million to $110 million and consist primarily of employee separation, continuity and other benefit-related costs and certain other restructuring costs. The Company anticipates these actions will be substantially completed by the end of 2022, with substantially all cash payments made by then. As a result of the 2020 Restructuring Initiative, the Company incurred the following pre-tax net charges during the three and nine months ended September 30, 2020 (in thousands): Three Months Ended September 30, 2020 Nine Months Ended September 30, 2020 Accelerated depreciation charges $ 6,291 $ 14,676 Asset impairment charges 7,391 7,391 Employee separation, continuity and other benefit-related costs (1) 53,647 53,647 Total $ 67,329 $ 75,714 __________ (1) As of September 30, 2020, all employee-related costs have been recognized in accordance with ASC 712. During the three and nine months ended September 30, 2020, these pre-tax net charges were primarily attributable to our Generic Pharmaceuticals segment, including $57.8 million and $66.2 million during the three and nine months ended September 30, 2020, respectively. The remaining amounts related to our other segments and certain corporate unallocated costs. As of September 30, 2020, cumulative amounts incurred to date include accelerated depreciation charges of approximately $14.7 million, asset impairment charges related to identifiable intangible assets and certain operating lease assets of approximately $7.4 million and employee separation, continuity and other benefit-related costs of approximately $53.6 million. Of these amounts, approximately $66.2 million were attributable to the Generic Pharmaceuticals segment, with the remaining amounts relating to our other segments and certain corporate unallocated costs. During the three and nine months ended September 30, 2020, the pre-tax net charges related to the 2020 Restructuring Initiative were included in our Condensed Consolidated Statements of Operations as follows (in thousands): Three Months Ended September 30, 2020 Nine Months Ended September 30, 2020 Cost of revenues $ 36,172 $ 42,198 Selling, general and administrative 20,185 22,130 Research and development 3,581 3,995 Asset impairment charges 7,391 7,391 Total $ 67,329 $ 75,714 Changes to the liability for the 2020 Restructuring Initiative during the nine months ended September 30, 2020 were as follows (in thousands): Employee Separation, Continuity and Other Benefit-Related Costs Total Liability balance as of December 31, 2019 $ — $ — Net charges 53,647 53,647 Liability balance as of September 30, 2020 $ 53,647 $ 53,647 Of the liability at September 30, 2020, $29.5 million is classified as current and is included in Accounts payable and accrued expenses in the Condensed Consolidated Balance Sheets, with the remaining amount classified as noncurrent and included in Other liabilities. |
Segment Results
Segment Results | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
SEGMENT RESULTS | NOTE 5. SEGMENT RESULTS The Company’s four reportable business segments are Branded Pharmaceuticals, Sterile Injectables, Generic Pharmaceuticals and International Pharmaceuticals. These segments reflect the level at which the chief operating decision maker (CODM) regularly reviews financial information to assess performance and to make decisions about resources to be allocated. Each segment derives revenue from the sales or licensing of its respective products and is discussed in more detail below. We evaluate segment performance based on Segment adjusted income (loss) from continuing operations before income tax, which we define as Loss from continuing operations before income tax and before certain upfront and milestone payments to partners; acquisition-related and integration items, including transaction costs and changes in the fair value of contingent consideration; cost reduction and integration-related initiatives such as separation benefits, continuity payments, other exit costs and certain costs associated with integrating an acquired company's operations; asset impairment charges; amortization of intangible assets; inventory step-up recorded as part of our acquisitions; litigation-related and other contingent matters; certain legal costs; gains or losses from early termination of debt; debt modification costs; gains or losses from the sales of businesses and other assets; foreign currency gains or losses on intercompany financing arrangements; and certain other items. Effective January 1, 2020, the Company revised its definition of Segment adjusted income (loss) from continuing operations before income tax to exclude certain legal costs in order to reflect changes in how the CODM reviews segment performance. The Company believes that such costs are not indicative of business performance and that excluding them more accurately reflects each segment’s results and better enables management to compare financial results between periods. Prior period results have been adjusted to reflect this change. Specifically, for the three months ended September 30, 2019, certain legal costs of $14.4 million and $0.1 million have been excluded from our Branded Pharmaceuticals and Generic Pharmaceuticals segments, respectively, and for the nine months ended September 30, 2019, certain legal costs of $49.3 million and $1.0 million have been excluded from our Branded Pharmaceuticals and Generic Pharmaceuticals segments, respectively, resulting in increases to the Segment adjusted income (loss) from continuing operations before income tax for these segments. This change had no impact on our Total consolidated loss from continuing operations before income tax. Certain of the corporate expenses incurred by the Company are not directly attributable to any specific segment. Accordingly, these costs are not allocated to any of the Company’s segments and are included in the results below as “Corporate unallocated costs.” Interest income and expense are also considered corporate items and not allocated to any of the Company’s segments. The Company’s Total segment adjusted income (loss) from continuing operations before income tax is equal to the combined results of each of its segments. Branded Pharmaceuticals Our Branded Pharmaceuticals segment includes a variety of branded prescription products to treat and manage conditions in urology, urologic oncology, endocrinology, pain and orthopedics. The products in this segment include XIAFLEX ® , SUPPRELIN ® LA, NASCOBAL ® Nasal Spray, AVEED ® , PERCOCET ® , TESTOPEL ® , EDEX ® and LIDODERM ® , among others. Sterile Injectables Our Sterile Injectables segment consists primarily of branded sterile injectable products such as VASOSTRICT ® , ADRENALIN ® and APLISOL ® , among others, and certain generic sterile injectable products, including ertapenem for injection (the authorized generic of Merck Sharp & Dohme Corp.’s (Merck) Invanz ® ) and ephedrine sulfate injection, among others. Generic Pharmaceuticals Our Generic Pharmaceuticals segment consists of a product portfolio including solid oral extended-release, solid oral immediate-release, liquids, semi-solids, patches, powders, ophthalmics and sprays and includes products in the pain management, urology, central nervous system disorders, immunosuppression, oncology, women’s health and cardiovascular disease markets, among others. International Pharmaceuticals Our International Pharmaceuticals segment includes a variety of specialty pharmaceutical products sold outside the U.S., primarily in Canada through our operating company Paladin Labs Inc. (Paladin). The key products of this segment serve various therapeutic areas, including attention deficit hyperactivity disorder, pain, women’s health and oncology. The following represents selected information for the Company’s reportable segments for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Net revenues from external customers: Branded Pharmaceuticals $ 223,682 $ 217,313 $ 557,276 $ 629,851 Sterile Injectables 251,393 263,635 906,997 777,963 Generic Pharmaceuticals 135,508 218,012 602,670 654,322 International Pharmaceuticals (1) 24,277 30,466 75,910 87,428 Total net revenues from external customers $ 634,860 $ 729,426 $ 2,142,853 $ 2,149,564 Segment adjusted income (loss) from continuing operations before income tax: Branded Pharmaceuticals $ 120,368 $ 105,864 $ 267,964 $ 302,682 Sterile Injectables 190,498 197,974 696,147 566,345 Generic Pharmaceuticals (13,428) 29,569 91,293 129,702 International Pharmaceuticals 10,679 11,511 34,180 35,053 Total segment adjusted income (loss) from continuing operations before income tax $ 308,117 $ 344,918 $ 1,089,584 $ 1,033,782 __________ (1) Revenues generated by our International Pharmaceuticals segment are primarily attributable to external customers located in Canada. There were no material revenues from external customers attributed to an individual country outside of the U.S. during any of the periods presented. The table below provides reconciliations of our Total consolidated loss from continuing operations before income tax, which is determined in accordance with U.S. GAAP, to our Total segment adjusted income (loss) from continuing operations before income tax for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Total consolidated loss from continuing operations before income tax $ (64,800) $ (24,070) $ (18,299) $ (120,363) Interest expense, net 135,648 136,903 397,689 404,387 Corporate unallocated costs (1) 39,976 37,891 116,888 124,351 Amortization of intangible assets 104,066 131,932 325,801 417,949 Upfront and milestone payments to partners 275 1,672 2,469 4,055 Continuity and separation benefits and other cost reduction initiatives (2) 67,692 11,023 100,356 15,172 Certain litigation-related and other contingencies, net (3) 1,810 (14,414) (23,938) (4,093) Certain legal costs (4) 18,343 14,556 51,884 50,229 Asset impairment charges (5) 8,412 4,766 106,197 258,652 Acquisition-related and integration items, net (6) (1,407) 16,025 17,100 (26,983) Gain on extinguishment of debt — — — (119,828) Foreign currency impact related to the remeasurement of intercompany debt instruments 1,663 (922) (2,426) 2,874 Other, net (7) (3,561) 29,556 15,863 27,380 Total segment adjusted income (loss) from continuing operations before income tax $ 308,117 $ 344,918 $ 1,089,584 $ 1,033,782 __________ (1) Amounts include certain corporate overhead costs, such as headcount, facility and corporate litigation expenses and certain other income and expenses. (2) Included within this line are costs associated with certain continuity and transitional compensation arrangements for certain senior management of the Company, including $4.3 million and $22.2 million during the three and nine months ended September 30, 2020, respectively, and $6.7 million during both the three and nine months ended September 30, 2019. Other amounts primarily relate to the 2020 Restructuring Initiative and certain other cost reduction initiatives, including employee separation, continuity and other benefit-related costs of $53.6 million, accelerated depreciation of $6.3 million and miscellaneous charges of $3.4 million during the three months ended September 30, 2020; employee separation, continuity and other benefit-related costs of $53.6 million, accelerated depreciation of $14.7 million and miscellaneous charges of $9.8 million during the nine months ended September 30, 2020; miscellaneous charges of $4.3 million during the three months ended September 30, 2019; and employee separation, continuity and other benefit-related costs of $2.2 million and miscellaneous charges of $6.3 million during the nine months ended September 30, 2019. Refer to Note 4. Restructuring for further discussion of the 2020 Restructuring Initiative. (3) Amounts include adjustments to our accruals for litigation-related settlement charges and certain settlement proceeds related to suits filed by our subsidiaries. Our material legal proceedings and other contingent matters are described in more detail in Note 13. Commitments and Contingencies. (4) Amounts relate to opioid-related legal expenses. (5) Amounts primarily relate to charges to impair goodwill and intangible assets and operating lease right-of-use assets as further described in Note 9. Goodwill and Other Intangibles and Note 8. Leases, respectively. (6) Amounts primarily relate to changes in the fair value of contingent consideration. (7) The amount during the nine months ended September 30, 2020 includes $31.1 million of third-party fees incurred in connection with the June 2020 Refinancing Transactions, which were accounted for as debt modifications. Refer to Note 12. Debt for additional information. Amounts during the three and nine months ended September 30, 2019 include $17.5 million for contract termination costs incurred as a result of certain product discontinuation activities in our International Pharmaceuticals segment and $14.1 million for a premium associated with an extended reporting period endorsement on an expiring insurance program. Remaining amounts in this line primarily relate to gains on sales of businesses and other assets, as further described in Note 16. Other (Income) Expense, Net. Asset information is not reviewed or included within our internal management reporting. Therefore, the Company has not disclosed asset information for each reportable segment. During the three and nine months ended September 30, 2020 and 2019, the Company disaggregated its revenue from contracts with customers into the categories included in the table below (in thousands). The Company believes these categories depict how the nature, timing and uncertainty of revenue and cash flows are affected by economic factors. Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Branded Pharmaceuticals: Specialty Products: XIAFLEX® $ 88,167 $ 82,756 $ 211,022 $ 226,118 SUPPRELIN® LA 28,229 20,772 63,344 66,542 Other Specialty (1) 23,724 28,470 68,795 78,397 Total Specialty Products $ 140,120 $ 131,998 $ 343,161 $ 371,057 Established Products: PERCOCET® $ 27,508 $ 28,561 $ 82,789 $ 88,199 TESTOPEL® 18,068 13,236 26,877 40,830 Other Established (2) 37,986 43,518 104,449 129,765 Total Established Products $ 83,562 $ 85,315 $ 214,115 $ 258,794 Total Branded Pharmaceuticals (3) $ 223,682 $ 217,313 $ 557,276 $ 629,851 Sterile Injectables: VASOSTRICT® $ 155,412 $ 129,691 $ 572,530 $ 384,854 ADRENALIN® 30,662 40,311 120,335 133,468 Ertapenem for injection 16,784 21,853 46,648 79,619 APLISOL® 9,443 28,085 25,821 55,996 Other Sterile Injectables (4) 39,092 43,695 141,663 124,026 Total Sterile Injectables (3) $ 251,393 $ 263,635 $ 906,997 $ 777,963 Total Generic Pharmaceuticals (5) $ 135,508 $ 218,012 $ 602,670 $ 654,322 Total International Pharmaceuticals (6) $ 24,277 $ 30,466 $ 75,910 $ 87,428 Total revenues, net $ 634,860 $ 729,426 $ 2,142,853 $ 2,149,564 __________ (1) Products included within Other Specialty are NASCOBAL ® Nasal Spray and AVEED ® . (2) Products included within Other Established include, but are not limited to, EDEX ® and LIDODERM ® . (3) Individual products presented above represent the top two performing products in each product category for either the three or nine months ended September 30, 2020 and/or any product having revenues in excess of $25 million during any quarterly period in 2020 or 2019. (4) Products included within Other Sterile Injectables include ephedrine sulfate injection and others. (5) The Generic Pharmaceuticals segment is comprised of a portfolio of products that are generic versions of branded products, are distributed primarily through the same wholesalers, generally have no intellectual property protection and are sold within the U.S. During the three and nine months ended September 30, 2019, colchicine tablets (the authorized generic of Takeda Pharmaceuticals U.S.A., Inc.’s (Takeda) Colcrys ® ), which launched in July 2018, made up 7% and 6% of consolidated total revenues, respectively. No other individual product within this segment has exceeded 5% of consolidated total revenues for the periods presented. (6) The International Pharmaceuticals segment, which accounted for less than 5% of consolidated total revenues for each of the periods presented, includes a variety of specialty pharmaceutical products sold outside the U.S., primarily in Canada through our operating company Paladin. |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 6. FAIR VALUE MEASUREMENTS Fair value guidance establishes a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value. These tiers include: • Level 1—Quoted prices in active markets for identical assets or liabilities. • Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. • Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Financial Instruments The financial instruments recorded in our Condensed Consolidated Balance Sheets include cash and cash equivalents, restricted cash and cash equivalents, accounts receivable, equity method investments, accounts payable and accrued expenses, acquisition-related contingent consideration and debt obligations. Included in cash and cash equivalents and restricted cash and cash equivalents are money market funds representing a type of mutual fund required by law to invest in low-risk securities (for example, U.S. government bonds, U.S. Treasury Bills and commercial paper). Money market funds pay dividends that generally reflect short-term interest rates. Due to their short-term maturity, the carrying amounts of non-restricted and restricted cash and cash equivalents (including money market funds), accounts receivable, accounts payable and accrued expenses approximate their fair values. Restricted Cash and Cash Equivalents The following table presents current and noncurrent restricted cash and cash equivalent balances at September 30, 2020 and December 31, 2019 (in thousands): Condensed Consolidated Balance Sheets Line Items September 30, 2020 December 31, 2019 Restricted cash and cash equivalents—current Restricted cash and cash equivalents $ 162,648 $ 247,457 Restricted cash and cash equivalents—noncurrent Other assets 18,400 18,400 Total restricted cash and cash equivalents $ 181,048 $ 265,857 The restricted cash and cash equivalents amounts primarily relate to litigation-related matters, including approximately $136.3 million and $242.8 million held in Qualified Settlement Funds (QSFs) for mesh-related matters at September 30, 2020 and December 31, 2019, respectively. See Note 13. Commitments and Contingencies for further information about mesh-related and other litigation-related matters. Additionally, at September 30, 2020, approximately $25.0 million of restricted cash and cash equivalents related to certain insurance-related matters. Acquisition-Related Contingent Consideration The fair value of contingent consideration liabilities is determined using unobservable inputs; hence, these instruments represent Level 3 measurements within the above-defined fair value hierarchy. These inputs include the estimated amount and timing of projected cash flows, the probability of success (achievement of the contingent event) and the risk-adjusted discount rate used to present value the probability-weighted cash flows. Subsequent to the acquisition date, at each reporting period, the contingent consideration liability is remeasured at current fair value with changes recorded in earnings. The estimates of fair value are uncertain and changes in any of the estimated inputs used as of the date of this report could have resulted in significant adjustments to fair value. See the “Recurring Fair Value Measurements” section below for additional information on acquisition-related contingent consideration. Recurring Fair Value Measurements The Company’s financial assets and liabilities measured at fair value on a recurring basis at September 30, 2020 and December 31, 2019 were as follows (in thousands): Fair Value Measurements at September 30, 2020 using: Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Money market funds $ 628,875 $ — $ — $ 628,875 Liabilities: Acquisition-related contingent consideration—current $ — $ — $ 9,665 $ 9,665 Acquisition-related contingent consideration—noncurrent $ — $ — $ 28,044 $ 28,044 Fair Value Measurements at December 31, 2019 using: Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Money market funds $ 427,033 $ — $ — $ 427,033 Liabilities: Acquisition-related contingent consideration—current $ — $ — $ 6,534 $ 6,534 Acquisition-related contingent consideration—noncurrent $ — $ — $ 23,123 $ 23,123 At September 30, 2020 and December 31, 2019, money market funds include $30.2 million and $70.2 million, respectively, in QSFs to be disbursed to mesh-related or other product liability claimants. Amounts in QSFs are considered restricted cash equivalents. See Note 13. Commitments and Contingencies for further discussion of our product liability cases. At September 30, 2020 and December 31, 2019, the differences between the amortized cost and the fair value of our money market funds were not material, individually or in the aggregate. Fair Value Measurements Using Significant Unobservable Inputs The following table presents changes to the Company’s liability for acquisition-related contingent consideration, which is measured at fair value on a recurring basis using significant unobservable inputs (Level 3), for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Beginning of period $ 42,057 $ 52,930 $ 29,657 $ 116,703 Amounts settled (3,103) (9,376) (8,785) (30,541) Changes in fair value recorded in earnings (1,407) 16,025 17,100 (26,983) Effect of currency translation 162 (85) (263) 315 End of period $ 37,709 $ 59,494 $ 37,709 $ 59,494 At September 30, 2020, the fair value measurements of the contingent consideration obligations were determined using risk-adjusted discount rates ranging from approximately 10.0% to 15.0% (weighted average rate of approximately 11.8%, weighted based on relative fair value). Changes in fair value recorded in earnings related to acquisition-related contingent consideration are included in our Condensed Consolidated Statements of Operations as Acquisition-related and integration items, net. Amounts recorded for the current and noncurrent portions of acquisition-related contingent consideration are included in Accounts payable and accrued expenses and Other liabilities, respectively, in our Condensed Consolidated Balance Sheets. The following table presents changes to the Company’s liability for acquisition-related contingent consideration during the nine months ended September 30, 2020 by acquisition (in thousands): Balance as of December 31, 2019 Changes in Fair Value Recorded in Earnings Amounts Settled and Other Balance as of September 30, 2020 Auxilium acquisition $ 13,207 $ 4,223 $ (1,644) $ 15,786 Lehigh Valley Technologies, Inc. acquisitions 6,800 11,950 (5,250) 13,500 Other 9,650 927 (2,154) 8,423 Total $ 29,657 $ 17,100 $ (9,048) $ 37,709 Nonrecurring Fair Value Measurements The Company’s financial assets and liabilities measured at fair value on a nonrecurring basis during the nine months ended September 30, 2020 were as follows (in thousands): Fair Value Measurements during the Nine Months Ended September 30, 2020 (1) using: Total Expense for the Nine Months Ended September 30, 2020 Level 1 Inputs Level 2 Inputs Level 3 Inputs Intangible assets, excluding goodwill (2) $ — $ — $ 24,377 $ (65,771) Certain property, plant and equipment — — — (1,248) Operating lease right-of-use assets — — — (6,392) Total $ — $ — $ 24,377 $ (73,411) __________ (1) The fair value amounts are presented as of the date of the fair value measurement as these assets are not measured at fair value on a recurring basis. Such measurements generally occur in connection with our quarter-end financial reporting close procedures. (2) These fair value measurements were determined using risk-adjusted discount rates ranging from approximately 10.0% to 15.0% (weighted average rate of approximately 12.2%, weighted based on relative fair value). The Company also performed fair value measurements in connection with its goodwill impairment tests. Refer to Note 9. Goodwill and Other Intangibles for additional information on goodwill and other intangible asset impairment tests, including information about the valuation methodologies utilized. |
Inventories
Inventories | 9 Months Ended |
Sep. 30, 2020 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | NOTE 7. INVENTORIES Inventories consist of the following at September 30, 2020 and December 31, 2019 (in thousands): September 30, 2020 December 31, 2019 Raw materials (1) $ 108,961 $ 124,171 Work-in-process (1) 75,913 65,392 Finished goods (1) 170,029 138,302 Total $ 354,903 $ 327,865 __________ (1) The components of inventory shown in the table above are net of allowance for obsolescence. Inventory that is in excess of the amount expected to be sold within one year is classified as noncurrent inventory and is not included in the table above. At September 30, 2020 and December 31, 2019, $34.6 million and $29.0 million, respectively, of noncurrent inventory was included in Other assets in the Condensed Consolidated Balance Sheets. As of September 30, 2020 and December 31, 2019, the Company’s Condensed Consolidated Balance Sheets included approximately $39.0 million and $17.6 million, respectively, of capitalized pre-launch inventories related to products that were not yet available to be sold. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
LEASES | NOTE 8. LEASES The following table presents information about the Company's right-of-use (ROU) assets and lease liabilities at September 30, 2020 and December 31, 2019 (in thousands): Condensed Consolidated Balance Sheets Line Items September 30, 2020 December 31, 2019 ROU assets: Operating lease ROU assets Operating lease assets $ 38,927 $ 51,700 Finance lease ROU assets Property, plant and equipment, net 49,860 56,793 Total ROU assets $ 88,787 $ 108,493 Operating lease liabilities: Current operating lease liabilities Current portion of operating lease liabilities $ 11,449 $ 10,763 Noncurrent operating lease liabilities Operating lease liabilities, less current portion 40,222 48,299 Total operating lease liabilities $ 51,671 $ 59,062 Finance lease liabilities: Current finance lease liabilities Accounts payable and accrued expenses $ 6,081 $ 5,672 Noncurrent finance lease liabilities Other liabilities 26,617 31,312 Total finance lease liabilities $ 32,698 $ 36,984 The following table presents information about lease costs and expenses and sublease income for the three and nine months ended September 30, 2020 and 2019 (in thousands): Condensed Consolidated Statements of Operations Line Items Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Operating lease cost Various (1) $ 3,339 $ 3,510 $ 10,443 $ 10,269 Finance lease cost: Amortization of ROU assets Various (1) $ 2,311 $ 2,311 $ 6,933 $ 7,096 Interest on lease liabilities Interest expense, net $ 416 $ 271 $ 1,323 $ 1,256 Other lease costs and income: Variable lease costs (2) Various (1) $ 2,601 $ 2,318 $ 7,443 $ 7,185 Operating lease ROU asset impairment charges Asset impairment charges $ 6,392 $ — $ 6,392 $ — Sublease income Various (1) $ (1,077) $ (932) $ (2,870) $ (2,828) __________ (1) Amounts are included in the Condensed Consolidated Statements of Operations based on the function that the underlying leased asset supports. The following table presents the components of such aggregate amounts for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Cost of revenues $ 2,815 $ 2,793 $ 8,589 $ 8,425 Selling, general and administrative $ 4,309 $ 4,347 $ 13,209 $ 13,145 Research and development $ 50 $ 67 $ 151 $ 152 (2) Amounts represent variable lease costs incurred that were not included in the initial measurement of the lease liability such as common area maintenance and utilities costs associated with leased real estate and certain costs associated with our automobile leases. The following table provides certain cash flow and supplemental noncash information related to our lease liabilities for the nine months ended September 30, 2020 and 2019 (in thousands): Nine Months Ended September 30, 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash payments for operating leases $ 10,819 $ 11,200 Operating cash payments for finance leases $ 1,982 $ 1,535 Financing cash payments for finance leases $ 3,626 $ 7,826 Lease liabilities arising from obtaining right-of-use assets: Operating leases $ — $ 623 Finance leases $ — $ 5,901 |
LEASES | NOTE 8. LEASES The following table presents information about the Company's right-of-use (ROU) assets and lease liabilities at September 30, 2020 and December 31, 2019 (in thousands): Condensed Consolidated Balance Sheets Line Items September 30, 2020 December 31, 2019 ROU assets: Operating lease ROU assets Operating lease assets $ 38,927 $ 51,700 Finance lease ROU assets Property, plant and equipment, net 49,860 56,793 Total ROU assets $ 88,787 $ 108,493 Operating lease liabilities: Current operating lease liabilities Current portion of operating lease liabilities $ 11,449 $ 10,763 Noncurrent operating lease liabilities Operating lease liabilities, less current portion 40,222 48,299 Total operating lease liabilities $ 51,671 $ 59,062 Finance lease liabilities: Current finance lease liabilities Accounts payable and accrued expenses $ 6,081 $ 5,672 Noncurrent finance lease liabilities Other liabilities 26,617 31,312 Total finance lease liabilities $ 32,698 $ 36,984 The following table presents information about lease costs and expenses and sublease income for the three and nine months ended September 30, 2020 and 2019 (in thousands): Condensed Consolidated Statements of Operations Line Items Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Operating lease cost Various (1) $ 3,339 $ 3,510 $ 10,443 $ 10,269 Finance lease cost: Amortization of ROU assets Various (1) $ 2,311 $ 2,311 $ 6,933 $ 7,096 Interest on lease liabilities Interest expense, net $ 416 $ 271 $ 1,323 $ 1,256 Other lease costs and income: Variable lease costs (2) Various (1) $ 2,601 $ 2,318 $ 7,443 $ 7,185 Operating lease ROU asset impairment charges Asset impairment charges $ 6,392 $ — $ 6,392 $ — Sublease income Various (1) $ (1,077) $ (932) $ (2,870) $ (2,828) __________ (1) Amounts are included in the Condensed Consolidated Statements of Operations based on the function that the underlying leased asset supports. The following table presents the components of such aggregate amounts for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Cost of revenues $ 2,815 $ 2,793 $ 8,589 $ 8,425 Selling, general and administrative $ 4,309 $ 4,347 $ 13,209 $ 13,145 Research and development $ 50 $ 67 $ 151 $ 152 (2) Amounts represent variable lease costs incurred that were not included in the initial measurement of the lease liability such as common area maintenance and utilities costs associated with leased real estate and certain costs associated with our automobile leases. The following table provides certain cash flow and supplemental noncash information related to our lease liabilities for the nine months ended September 30, 2020 and 2019 (in thousands): Nine Months Ended September 30, 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash payments for operating leases $ 10,819 $ 11,200 Operating cash payments for finance leases $ 1,982 $ 1,535 Financing cash payments for finance leases $ 3,626 $ 7,826 Lease liabilities arising from obtaining right-of-use assets: Operating leases $ — $ 623 Finance leases $ — $ 5,901 |
Goodwill and Other Intangibles
Goodwill and Other Intangibles | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND OTHER INTANGIBLES | NOTE 9. GOODWILL AND OTHER INTANGIBLES Goodwill Changes in the carrying amount of our goodwill for the nine months ended September 30, 2020 were as follows (in thousands): Branded Pharmaceuticals Sterile Injectables Generic Pharmaceuticals International Pharmaceuticals Total Goodwill as of December 31, 2019 $ 828,818 $ 2,731,193 $ — $ 35,173 $ 3,595,184 Effect of currency translation — — — (2,387) (2,387) Goodwill impairment charges — — — (32,786) (32,786) Goodwill as of September 30, 2020 $ 828,818 $ 2,731,193 $ — $ — $ 3,560,011 The carrying amounts of goodwill at September 30, 2020 and December 31, 2019 are net of the following accumulated impairments (in thousands): Branded Pharmaceuticals Sterile Injectables Generic Pharmaceuticals International Pharmaceuticals Total Accumulated impairment losses as of December 31, 2019 $ 855,810 $ — $ 3,142,657 $ 500,417 $ 4,498,884 Accumulated impairment losses as of September 30, 2020 $ 855,810 $ — $ 3,142,657 $ 522,184 $ 4,520,651 Other Intangible Assets Changes in the amount of other intangible assets for the nine months ended September 30, 2020 were as follows (in thousands): Cost basis: Balance as of December 31, 2019 Acquisitions Impairments Other (1) Effect of Currency Translation Balance as of September 30, 2020 Indefinite-lived intangibles: In-process research and development $ 93,900 $ — $ — $ (90,900) $ — $ 3,000 Total indefinite-lived intangibles $ 93,900 $ — $ — $ (90,900) $ — $ 3,000 Finite-lived intangibles: Licenses (weighted average life of 14 years) $ 457,402 $ — $ (8,700) $ — $ — $ 448,702 Tradenames 6,409 — — — — 6,409 Developed technology (weighted average life of 11 years) 5,844,439 — (57,071) (15,428) (6,633) 5,765,307 Total finite-lived intangibles (weighted average life of 11 years) $ 6,308,250 $ — $ (65,771) $ (15,428) $ (6,633) $ 6,220,418 Total other intangibles $ 6,402,150 $ — $ (65,771) $ (106,328) $ (6,633) $ 6,223,418 Accumulated amortization: Balance as of December 31, 2019 Amortization Impairments Other (1) Effect of Currency Translation Balance as of September 30, 2020 Finite-lived intangibles: Licenses $ (410,336) $ (6,162) $ — $ — $ — $ (416,498) Tradenames (6,409) — — — — (6,409) Developed technology (3,414,138) (319,639) — 108,328 3,800 (3,621,649) Total other intangibles $ (3,830,883) $ (325,801) $ — $ 108,328 $ 3,800 $ (4,044,556) Net other intangibles $ 2,571,267 $ 2,178,862 __________ (1) Amounts include reclassification adjustments of $90.9 million from In-process research and development to Developed technology for certain assets that were placed in service during the nine months ended September 30, 2020. The remaining amounts primarily relate to the removal of certain fully amortized Developed technology intangible assets. Amortization expense for the three and nine months ended September 30, 2020 totaled $104.1 million and $325.8 million, respectively. Amortization expense for the three and nine months ended September 30, 2019 totaled $131.9 million and $417.9 million, respectively. Amortization expense is included in Cost of revenues in the Condensed Consolidated Statements of Operations. For intangible assets subject to amortization, estimated amortization expense for the five fiscal years subsequent to December 31, 2019 is as follows (in thousands): 2020 $ 428,828 2021 $ 394,331 2022 $ 379,640 2023 $ 336,465 2024 $ 298,198 Impairments Goodwill and indefinite-lived intangible assets are tested for impairment annually and when events or changes in circumstances indicate that the asset might be impaired. Our annual assessment is performed as of October 1. As part of our goodwill and intangible asset impairment assessments, we estimate the fair values of our reporting units and our intangible assets using an income approach that utilizes a discounted cash flow model or, where appropriate, a market approach. The discounted cash flow models are dependent upon our estimates of future cash flows and other factors including estimates of (i) future operating performance, including future sales, long-term growth rates, operating margins, discount rates, variations in the amount and timing of cash flows and the probability of achieving the estimated cash flows and (ii) future economic conditions. These assumptions are based on significant inputs not observable in the market and thus represent Level 3 measurements within the fair value hierarchy. The discount rates applied to the estimated cash flows are based on the overall risk associated with the particular assets and other market factors. We believe the discount rates and other inputs and assumptions are consistent with those that a market participant would use. Any impairment charges resulting from annual or interim goodwill and intangible asset impairment assessments are recorded to Asset impairment charges in our Condensed Consolidated Statements of Operations. During the three and nine months ended September 30, 2020 and 2019, the Company incurred the following goodwill and other intangible asset impairment charges (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Goodwill impairment charges $ — $ — $ 32,786 $ 151,108 Other intangible asset impairment charges $ 2,020 $ 4,261 $ 65,771 $ 104,660 Except as described below, pre-tax non-cash asset impairment charges related primarily to certain in-process research and development and/or developed technology intangible assets that were tested for impairment following changes in market conditions and certain other factors impacting recoverability. As a result of certain business decisions that occurred during the first quarter of 2020, we tested the goodwill of our Paladin reporting unit for impairment as of March 31, 2020. The fair value of the reporting unit was estimated using an income approach that utilized a discounted cash flow model. The discount rate utilized in this test was 9.5%. This goodwill impairment test resulted in a pre-tax non-cash goodwill impairment charge of $32.8 million during the three months ended March 31, 2020, representing the remaining carrying amount. This impairment was primarily attributable to portfolio decisions and updated market expectations during the quarter. As a result of certain competitive events that occurred during the first quarter of 2019, we tested the goodwill of our Generic Pharmaceuticals reporting unit for impairment as of March 31, 2019. The fair value of the reporting unit was estimated using an income approach that utilized a discounted cash flow model. The discount rate utilized in this test was 10.5%. This goodwill impairment test resulted in a pre-tax non-cash goodwill impairment charge of $86.0 million during the three months ended March 31, 2019, representing the excess of this reporting unit’s carrying amount over its estimated fair value. This Generic Pharmaceuticals impairment can be primarily attributed to the impact of the competitive events referenced above and an increase in the discount rate used in the determination of fair value. During the second quarter of 2019, unfavorable competitive and pricing events occurred that caused us to update certain assumptions from those used in our first-quarter 2019 Generic Pharmaceuticals goodwill impairment test. We considered these events, together with the fact that this reporting unit’s carrying amount equaled its fair value immediately subsequent to the first-quarter 2019 goodwill impairment charge, as part of our qualitative assessment of goodwill triggering events for the second quarter of 2019. As a result, we concluded that it was more likely than not that the fair value of this reporting unit was below its carrying amount as of June 30, 2019 and a goodwill impairment test was required. After performing this quantitative test, we determined that this reporting unit’s carrying amount exceeded its estimated fair value. The fair value of the reporting unit was estimated using an income approach that utilized a discounted cash flow model. The discount rate utilized in this test was 10.5%. Based on the excess of this reporting unit’s carrying amount over its estimated fair value, we recorded a pre-tax non-cash goodwill impairment charge of $65.1 million during the three months ended June 30, 2019, representing the entire remaining amount of this reporting unit’s goodwill. We are closely monitoring the impact of COVID-19 on our business. It is possible that COVID-19 could result in reductions to the estimated fair values of our goodwill and other intangible assets, which could ultimately result in asset impairment charges that may be material. |
Contract Assets and Liabilities
Contract Assets and Liabilities | 9 Months Ended |
Sep. 30, 2020 | |
Contract with Customer, Contract Asset, Contract Liability, and Receivable [Abstract] | |
CONTRACT ASSETS AND LIABILITIES | NOTE 10. CONTRACT ASSETS AND LIABILITIES Our revenue consists almost entirely of sales of our pharmaceutical products to customers, whereby we ship products to a customer pursuant to a purchase order. Revenue contracts such as these do not generally give rise to contract assets or contract liabilities because: (i) the underlying contracts generally have only a single performance obligation and (ii) we do not generally receive consideration until the performance obligation is fully satisfied. At September 30, 2020, the unfulfilled performance obligations for these types of contracts relate to ordered but undelivered products. We generally expect to fulfill the performance obligations and recognize revenue within one week of entering into the underlying contract. Based on the short-term initial contract duration, additional disclosure about the remaining performance obligations is not required. Certain of our other revenue-generating contracts, including license and collaboration agreements, may result in contract assets and/or contract liabilities. For example, we may recognize contract liabilities upon receipt of certain upfront and milestone payments from customers when there are remaining performance obligations. The following table shows the opening and closing balances of contract assets and contract liabilities from contracts with customers (dollars in thousands): September 30, 2020 December 31, 2019 $ Change % Change Contract assets, net (1) $ 13,625 $ — $ 13,625 NM Contract liabilities, net (2) $ 7,725 $ 6,592 $ 1,133 17 % __________ NM indicates that the percentage change is not meaningful or is greater than 100%. (1) At September 30, 2020, approximately $2.6 million of this contract asset amount is classified as current and is included in Prepaid expenses and other current assets in the Company’s Condensed Consolidated Balance Sheets. The remaining amount is classified as noncurrent and is included in Other assets. The net increase in contract assets during the nine months ended September 30, 2020 was primarily due to the Company’s estimated consideration for the sale of certain intellectual property rights. (2) At September 30, 2020 and December 31, 2019, approximately $2.9 million and $1.4 million, respectively, of these contract liability amounts are classified as current and are included in Accounts payable and accrued expenses in the Company’s Condensed Consolidated Balance Sheets. The remaining amounts are classified as noncurrent and are included in Other liabilities. The increase in contract liabilities during the nine months ended September 30, 2020 was primarily due to a new agreement entered into during the nine months ended September 30, 2020, partially offset by approximately $0.4 million in revenue recognized during the period. During the nine months ended September 30, 2020, we recognized revenue of $14.0 million relating to performance obligations satisfied, or partially satisfied, in prior periods. Such revenue generally relates to changes in estimates with respect to our variable consideration. |
Accounts Payable and Accrued Ex
Accounts Payable and Accrued Expenses | 9 Months Ended |
Sep. 30, 2020 | |
Accounts Payable and Accrued Liabilities, Current [Abstract] | |
ACCOUNTS PAYABLE AND ACCRUED EXPENSES | NOTE 11. ACCOUNTS PAYABLE AND ACCRUED EXPENSES Accounts payable and accrued expenses include the following at September 30, 2020 and December 31, 2019 (in thousands): September 30, 2020 December 31, 2019 Trade accounts payable $ 104,621 $ 101,532 Returns and allowances 205,962 206,248 Rebates 119,265 129,056 Chargebacks 2,589 1,594 Accrued interest 135,199 112,860 Accrued payroll and related benefits 112,256 79,869 Accrued royalties and other distribution partner payables 61,355 115,816 Acquisition-related contingent consideration—current 9,665 6,534 Other 117,492 146,440 Total $ 868,404 $ 899,949 |
Debt
Debt | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
DEBT | NOTE 12. DEBT The following table presents information about the Company’s total indebtedness at September 30, 2020 and December 31, 2019 (dollars in thousands): September 30, 2020 December 31, 2019 Effective Interest Rate Principal Amount Carrying Amount Effective Interest Rate Principal Amount Carrying Amount 7.25% Senior Notes due 2022 7.25 % $ 8,294 $ 8,294 7.25 % $ 8,294 $ 8,294 5.75% Senior Notes due 2022 5.75 % 172,048 172,048 5.75 % 182,479 182,479 5.375% Senior Notes due 2023 5.62 % 6,127 6,095 5.62 % 210,440 209,018 6.00% Senior Notes due 2023 6.28 % 56,436 56,029 6.28 % 1,439,840 1,426,998 5.875% Senior Secured Notes due 2024 6.14 % 300,000 297,109 6.14 % 300,000 296,647 6.00% Senior Notes due 2025 6.27 % 21,578 21,354 6.27 % 1,200,000 1,185,726 7.50% Senior Secured Notes due 2027 7.70 % 2,015,479 1,994,514 7.71 % 1,500,000 1,482,212 9.50% Senior Secured Second Lien Notes due 2027 9.68 % 940,590 932,175 — — 6.00% Senior Notes due 2028 6.11 % 1,260,416 1,251,498 — — Term Loan Facility 5.21 % 3,304,013 3,281,385 6.21 % 3,329,625 3,302,675 Revolving Credit Facility 2.69 % 300,000 300,000 4.25 % 300,000 300,000 Total long-term debt, net $ 8,384,981 $ 8,320,501 $ 8,470,678 $ 8,394,049 Less current portion, net 34,150 34,150 34,150 34,150 Total long-term debt, less current portion, net $ 8,350,831 $ 8,286,351 $ 8,436,528 $ 8,359,899 The Company and its subsidiaries, with certain customary exceptions, guarantee or serve as issuers or borrowers of the debt instruments representing substantially all of the Company’s indebtedness at September 30, 2020. The obligations under (i) the 5.875% Senior Secured Notes due 2024, (ii) the 7.50% Senior Secured Notes due 2027 and (iii) the Credit Agreement (as defined below) and related loan documents are secured on a pari passu basis by a perfected first priority lien (subject to certain permitted liens) on the collateral securing such instruments, which collateral represents substantially all of the assets of the issuers or borrowers and the guarantors party thereto (subject to customary exceptions). The obligations under the 9.50% Senior Secured Second Lien Notes due 2027 are secured by a second priority lien (subject to certain permitted liens) on, and on a junior basis with respect to, the collateral securing the obligations under the Credit Agreement, the 5.875% Senior Secured Notes due 2024 and the 7.50% Senior Secured Notes due 2027 and the related guarantees. Our senior unsecured notes are unsecured and effectively subordinated in right of priority to the Credit Agreement, the 5.875% Senior Secured Notes due 2024, the 7.50% Senior Secured Notes due 2027 and the 9.50% Senior Secured Second Lien Notes due 2027, in each case to the extent of the value of the collateral securing such instruments. The aggregate estimated fair value of the Company’s long-term debt, which was estimated using inputs based on quoted market prices for the same or similar debt issuances, was $8.1 billion and $7.4 billion at September 30, 2020 and December 31, 2019, respectively. Based on this valuation methodology, we determined these debt instruments represent Level 2 measurements within the fair value hierarchy. Credit Facilities The Company and certain of its subsidiaries are party to a credit agreement (as amended from time to time, the Credit Agreement), which provides for (i) a $1,000.0 million senior secured revolving credit facility (the Revolving Credit Facility) and (ii) a senior secured term loan facility in an initial principal amount of $3,415.0 million (the Term Loan Facility and, together with the Revolving Credit Facility, the Credit Facilities). Current amounts outstanding under the Credit Facilities are set forth in the table above. After giving effect to borrowings under the Revolving Credit Facility and issued and outstanding letters of credit, approximately $696.2 million of remaining credit is available under the Revolving Credit Facility as of September 30, 2020. The Company’s outstanding debt agreements contain a number of restrictive covenants, including certain limitations on the Company’s ability to incur additional indebtedness. At September 30, 2020 and December 31, 2019, we were in compliance with all covenants contained in the Credit Agreement. Senior Notes and Senior Secured Notes The June 2020 Refinancing Transactions (as defined below) resulted in certain changes to our senior notes and senior secured notes that are further described under the heading “Debt Financing Transactions” below. Following the June 2020 Refinancing Transactions, our various senior notes and senior secured notes mature between 2022 and 2028. The indentures governing these notes generally allow for redemption prior to maturity, in whole or in part, subject to certain restrictions and limitations described therein, in the following ways: • Until a date specified in each indenture (the Non-Call Period), the notes may be redeemed, in whole or in part, by paying the sum of: (i) 100% of the principal amount being redeemed, (ii) an applicable make-whole premium as described in each indenture and (iii) accrued and unpaid interest to, but excluding, the redemption date. As of September 30, 2020, the Non-Call Period has expired for each of our notes except for the 7.50% Senior Secured Notes due 2027, the 9.50% Senior Secured Second Lien Notes due 2027 and the 6.00% Senior Notes due 2028. • After the Non-Call Period specified in each indenture, the notes may be redeemed, in whole or in part, at redemption prices set forth in each indenture, plus accrued and unpaid interest to, but excluding, the redemption date. The redemption prices for each of our notes vary over time. The redemption prices pursuant to this clause range from 100.000% to 107.125% of principal at September 30, 2020; however, these redemption prices generally decrease to 100% of the principal amount of the applicable notes over time as the notes approach maturity pursuant to a step-down schedule set forth in each of the indentures. • Until a date specified in each indenture, the notes may be redeemed, in part (up to 35% or 40% of the principal amount outstanding as specified in each indenture), with the net cash proceeds from specified equity offerings at redemption prices set forth in each indenture, plus accrued and unpaid interest to, but excluding, the redemption date. As of September 30, 2020, this clause has expired for each of our notes except for the 7.50% Senior Secured Notes due 2027, the 9.50% Senior Secured Second Lien Notes due 2027 and the 6.00% Senior Notes due 2028, for which the specified redemption premiums are 107.500%, 109.500% and 106.000%, respectively. Following the June 2020 Refinancing Transactions, the indentures governing our various senior secured notes and the 6.00% Senior Notes due 2028 contain affirmative and negative covenants that the Company believes to be customary for similar indentures. Under the senior secured notes indentures, the negative covenants, among other things, restrict the Company’s ability and the ability of its restricted subsidiaries (as defined in the indentures) to incur certain additional indebtedness and issue preferred stock; make certain dividends, distributions, investments and other restricted payments; sell certain assets; enter into sale and leaseback transactions; agree to certain restrictions on the ability of restricted subsidiaries to make certain payments to the Company or any of its restricted subsidiaries; create certain liens; merge, consolidate or sell all or substantially all of the Company’s assets; enter into certain transactions with affiliates or designate subsidiaries as unrestricted subsidiaries. These covenants are subject to a number of exceptions and qualifications, including the fall away or revision of certain of these covenants and release of collateral in the case of the senior secured notes, upon the notes receiving investment grade credit ratings. At September 30, 2020 and December 31, 2019, we were in compliance with all covenants contained in the indentures governing our various senior notes and senior secured notes. As further described under the heading “Debt Financing Transactions” below, we have eliminated substantially all of the restrictive covenants and certain events of default in the indentures governing our senior unsecured notes, except for those in the 6.00% Senior Notes due 2028 indenture. There have been no other significant changes to our senior notes and senior secured notes since December 31, 2019. Debt Financing Transactions Set forth below are certain disclosures relating to debt financing transactions that occurred during the nine months ended September 30, 2020 or the year ended December 31, 2019. March 2019 Refinancing In March 2019, the Company executed certain transactions (the March 2019 Refinancing Transactions) that included: • entry into an amendment (the Revolving Credit Facility Amendment) to the Credit Agreement; • issuance of $1,500.0 million of 7.50% Senior Secured Notes due 2027; • repurchase of $1,642.2 million aggregate principal amount ($1,624.0 million aggregate carrying amount) of certain of the Company’s senior unsecured notes for $1,500.0 million in cash, excluding accrued interest (the Notes Repurchases); and • solicitation of consents from the holders of the existing 7.25% Senior Notes due 2022 and 5.75% Senior Notes due 2022 to certain amendments to the indentures governing such notes, which eliminated substantially all of the restrictive covenants, certain events of default and other provisions contained in each such indenture. The difference between the cash paid and the carrying amount of notes repurchased in the Notes Repurchases resulted in a $124.0 million gain. In connection with the March 2019 Refinancing Transactions, we also incurred costs and fees totaling $26.2 million, of which $4.2 million related to the Notes Repurchases, $19.1 million related to the 7.50% Senior Secured Notes due 2027 issuance and $2.9 million related to the Revolving Credit Facility Amendment. The costs incurred in connection with the Notes Repurchases were charged to expense in the first quarter of 2019 and recorded as a partial offset to the gain. The costs incurred in connection with the 7.50% Senior Secured Notes due 2027 issuance and the Revolving Credit Facility Amendment, together with previously deferred debt issuance costs associated with the Revolving Credit Facility, have been deferred to be amortized as interest expense over the terms of the respective instruments. The net gain resulting from the March 2019 Refinancing Transactions was included in the Gain on extinguishment of debt line item in the Condensed Consolidated Statements of Operations. June 2019 Revolving Credit Facility Borrowing In June 2019, the Company borrowed $300.0 million under the Revolving Credit Facility to be used for purposes consistent with the Company’s capital allocation priorities, including for general corporate purposes. June 2020 Refinancing In June 2020, the Company executed certain transactions (the June 2020 Refinancing Transactions) that included: (i) the solicitation of consents from the holders of the Old Notes (defined below) to certain amendments to the indentures governing such notes, which, pursuant to a supplemental indenture to each such indenture executed by the respective issuers and guarantors, eliminated substantially all of the restrictive covenants, certain events of default and other provisions contained in each such indenture and (ii) the exchanges (collectively, the Exchange Offers), by certain of the Company’s wholly-owned subsidiaries, of the following: • $204.3 million aggregate principal amount of outstanding 5.375% Senior Notes due 2023, issued by Endo Finance LLC (Endo Finance) and Endo Finco Inc. (Endo Finco) (the Old 5.375% 2023 Notes); • $1,383.4 million aggregate principal amount of outstanding 6.00% Senior Notes due 2023, co-issued by Endo Designated Activity Company (Endo DAC), Endo Finance and Endo Finco (the Old 6.00% 2023 Notes); and • $1,178.4 million aggregate principal amount of outstanding 6.00% Senior Notes due 2025, co-issued by Endo DAC, Endo Finance and Endo Finco (the Old 6.00% 2025 Notes, and collectively with the Old 5.375% 2023 Notes and Old 6.00% 2023 Notes, the Old Notes) for: • $515.5 million aggregate principal amount of additional 7.50% Senior Secured Notes due 2027 issued by Par Pharmaceutical, Inc. (PPI) (the Additional 7.50% Senior Secured Notes due 2027); • $940.6 million aggregate principal amount of new 9.50% Senior Secured Second Lien Notes due 2027 co-issued by Endo DAC, Endo Finance and Endo Finco (together with the Additional 7.50% Senior Secured Notes due 2027, the New Secured Notes); • $1,260.4 million aggregate principal amount of new 6.00% Senior Notes due 2028 co-issued by Endo DAC, Endo Finance and Endo Finco (collectively with the Additional 7.50% Senior Secured Notes due 2027 and the 9.50% Senior Secured Second Lien Notes due 2027, the New Senior Notes); and • $47.2 million in cash. The New Senior Notes were issued in a private offering to “qualified institutional buyers” (as defined in Rule 144A under the Securities Act) and outside the U.S. to non-U.S. persons in compliance with Regulation S under the Securities Act. The Additional 7.50% Senior Secured Notes due 2027 are an additional issuance of our existing $1,500.0 million aggregate principal amount of 7.50% Senior Secured Notes due 2027 issued on March 28, 2019, which we refer to collectively as the 7.50% Senior Secured Notes due 2027. The 7.50% Senior Secured Notes due 2027 are guaranteed on a senior secured basis by the Company and its subsidiaries that also guarantee the Credit Agreement (collectively, the Guarantors). The 7.50% Senior Secured Notes due 2027 are senior secured obligations of PPI and the Guarantors and are secured by the same collateral that secures the Credit Agreement and the Company’s existing senior secured notes. Interest on the Additional 7.50% Senior Secured Notes due 2027 is payable semiannually in arrears on April 1 and October 1 of each year, beginning on October 1, 2020. The 7.50% Senior Secured Notes due 2027 will mature on April 1, 2027; however, the indenture governing these notes generally allows for redemption prior to maturity, in whole or in part, subject to certain restrictions and limitations described therein, in the following ways: • Before April 1, 2022, the 7.50% Senior Secured Notes due 2027 may be redeemed, in whole or in part, by paying the sum of: (i) 100% of the principal amount being redeemed, (ii) an applicable make-whole premium as described in the indenture and (iii) accrued and unpaid interest to, but excluding, the redemption date. • On or after April 1, 2022, the 7.50% Senior Secured Notes due 2027 may be redeemed, in whole or in part, at redemption prices set forth in the indenture, plus accrued and unpaid interest to, but excluding, the redemption date. The redemption prices for the 7.50% Senior Secured Notes due 2027 vary over time pursuant to a step-down schedule set forth in the indenture, beginning at 105.625% of the principal amount redeemed and decreasing to 100% by April 1, 2025. • Before April 1, 2022, the 7.50% Senior Secured Notes due 2027 may be redeemed, in part (up to 35% of the principal amount outstanding) with the net cash proceeds from specified equity offerings at 107.500% of the principal amount redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. The 9.50% Senior Secured Second Lien Notes due 2027 are guaranteed on a senior secured second lien basis by the Company and the Guarantors. The 9.50% Senior Secured Second Lien Notes due 2027 are senior secured second lien obligations of Endo DAC, Endo Finance, Endo Finco and the Guarantors and are secured by a second priority lien on, and on a junior basis with respect to, the same collateral that secures the Credit Agreement and the Company’s existing senior secured notes. Interest on the 9.50% Senior Secured Second Lien Notes due 2027 is payable semiannually in arrears on January 31 and July 31 of each year, beginning on January 31, 2021. The 9.50% Senior Secured Second Lien Notes due 2027 will mature on July 31, 2027; however, the indenture governing these notes generally allows for redemption prior to maturity, in whole or in part, subject to certain restrictions and limitations described therein, in the following ways: • Before July 31, 2023, the 9.50% Senior Secured Second Lien Notes due 2027 may be redeemed, in whole or in part, by paying the sum of: (i) 100% of the principal amount being redeemed, (ii) an applicable make-whole premium as described in the indenture and (iii) accrued and unpaid interest to, but excluding, the redemption date. • On or after July 31, 2023, the 9.50% Senior Secured Second Lien Notes due 2027 may be redeemed, in whole or in part, at redemption prices set forth in the indenture, plus accrued and unpaid interest to, but excluding, the redemption date. The redemption prices for the 9.50% Senior Secured Second Lien Notes due 2027 vary over time pursuant to a step-down schedule set forth in the indenture, beginning at 107.125% of the principal amount redeemed and decreasing to 100% by July 31, 2026. • Before July 31, 2023, the 9.50% Senior Secured Second Lien Notes due 2027 may be redeemed, in part (up to 40% of the principal amount outstanding) with the net cash proceeds from specified equity offerings at 109.500% of the principal amount redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. The 6.00% Senior Notes due 2028 are unsecured and effectively subordinated to all of our existing and future secured indebtedness (including the obligations under the Credit Agreement, the existing secured notes and the New Secured Notes) to the extent of the value of the collateral securing such instruments. Interest on the 6.00% Senior Notes due 2028 is payable semiannually in arrears on June 30 and December 30 of each year, beginning on December 30, 2020. The 6.00% Senior Notes due 2028 will mature on June 30, 2028; however, the indenture governing these notes generally allows for redemption prior to maturity, in whole or in part, subject to certain restrictions and limitations described therein, in the following ways: • Before June 30, 2023, the 6.00% Senior Notes due 2028 may be redeemed, in whole or in part, by paying the sum of: (i) 100% of the principal amount being redeemed, (ii) an applicable make-whole premium as described in the indenture and (iii) accrued and unpaid interest to, but excluding, the redemption date. • On or after June 30, 2023, the 6.00% Senior Notes due 2028 may be redeemed, in whole or in part, at redemption prices set forth in the indenture, plus accrued and unpaid interest to, but excluding, the redemption date. The redemption prices for the 6.00% Senior Notes due 2028 vary over time pursuant to a step-down schedule set forth in the indenture, beginning at 104.500% of the principal amount redeemed and decreasing to 100% by June 30, 2026. • Before June 30, 2023, the 6.00% Senior Notes due 2028 may be redeemed, in part (up to 40% of the principal amount outstanding) with the net cash proceeds from specified equity offerings at 106.000% of the principal amount redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. The June 2020 Refinancing Transactions were accounted for as debt modifications. Previously deferred and unamortized amounts associated with the Old Notes exchanged will be amortized over the respective terms of the New Senior Notes. In connection with the June 2020 Refinancing Transactions, we incurred fees to third parties of approximately $31.1 million, which were charged to expense and included in Selling, general and administrative expenses in the Condensed Consolidated Statements of Operations. August 2020 Tender Offer In August 2020, Endo Finance repurchased and retired approximately $10 million aggregate principal of 5.75% Senior Notes due 2022 pursuant to a tender offer (the August 2020 Tender Offer). Maturities The following table presents, as of September 30, 2020, the maturities on our long-term debt for each of the five fiscal years subsequent to December 31, 2019 (in thousands): Maturities (1)(2) 2020 (3) $ 34,150 2021 $ 34,150 2022 (4) $ 237,292 2023 $ 96,713 2024 (4) $ 3,770,225 __________ (1) Certain amounts borrowed pursuant to the Credit Facilities will immediately mature if certain of our senior notes are not refinanced or repaid in full prior to the date that is 91 days prior to the respective stated maturity dates thereof. Accordingly, we may seek to repay or refinance certain senior notes prior to their stated maturity dates. The amounts in this maturities table do not reflect any such early repayment or refinancing; rather, they reflect stated maturity dates. (2) With respect to the notes impacted by the Exchange Offers and the August 2020 Tender Offer, amounts included in the table above represent maturities as of September 30, 2020 after giving effect to such transactions. (3) With respect to the Term Loan Facility, amounts in 2020 include both payments made through September 30, 2020 and expected payments for the remainder of 2020. (4) Based on the Company’s borrowings under the Revolving Credit Facility that were outstanding at September 30, 2020, $22.8 million will mature in 2022, with the remainder maturing in 2024. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 13. COMMITMENTS AND CONTINGENCIES Legal Proceedings and Investigations We and certain of our subsidiaries are involved in various claims, legal proceedings and internal and governmental investigations (collectively, proceedings) arising from time to time, including, among others, those relating to product liability, intellectual property, regulatory compliance, consumer protection, tax and commercial matters. While we cannot predict the outcome of these proceedings and we intend to vigorously prosecute or defend our position as appropriate, there can be no assurance that we will be successful or obtain any requested relief. An adverse outcome in any of these proceedings could have a material adverse effect on our business, financial condition, results of operations and cash flows. We are subject to a number of matters that are not being disclosed herein because, in the opinion of our management, these matters are immaterial both individually and in the aggregate with respect to our financial position, results of operations and cash flows. We believe that certain settlements and judgments, as well as legal defense costs, relating to certain product liability or other matters are or may be covered in whole or in part under our insurance policies with a number of insurance carriers. In certain circumstances, insurance carriers reserve their rights to contest or deny coverage. We intend to contest vigorously any disputes with our insurance carriers and to enforce our rights under the terms of our insurance policies. Accordingly, we will record receivables with respect to amounts due under these policies only when the realization of the potential claim for recovery is considered probable. Amounts recovered under our insurance policies could be materially less than stated coverage limits and may not be adequate to cover damages, other relief and/or costs relating to claims. In addition, there is no guarantee that insurers will pay claims in the amounts that we expect or that coverage will otherwise be available. See the risk factor “We may not have and may be unable to obtain or maintain insurance adequate to cover potential liabilities” in the Annual Report for more information. As of September 30, 2020, our accrual for loss contingencies totaled $374.8 million, the most significant components of which relate to product liability and related matters associated with transvaginal surgical mesh products, which we have not sold since March 2016. Although we believe there is a possibility that a loss in excess of the amount recognized exists, we are unable to estimate the possible loss or range of loss in excess of the amount recognized at this time. While the timing of the resolution of certain of the matters accrued for as loss contingencies remains uncertain and could extend beyond 12 months, as of September 30, 2020, the entire liability accrual amount is classified in the Current portion of legal settlement accrual in the Condensed Consolidated Balance Sheets. Vaginal Mesh Matters Since 2008, we and certain of our subsidiaries, including American Medical Systems Holdings, Inc. (AMS) (subsequently converted to Astora Women’s Health Holding LLC and merged into Astora Women’s Health LLC and referred to herein as AMS and/or Astora), have been named as defendants in multiple lawsuits in various state and federal courts in the U.S., Canada, Australia and other countries, alleging personal injury resulting from the use of transvaginal surgical mesh products designed to treat pelvic organ prolapse (POP) and stress urinary incontinence (SUI). We have not sold such products since March 2016. Plaintiffs claim a variety of personal injuries, including chronic pain, incontinence, inability to control bowel function and permanent deformities, and seek compensatory and punitive damages, where available. Various Master Settlement Agreements (MSAs) and other agreements have resolved approximately 71,000 filed and unfiled U.S. mesh claims as of September 30, 2020. These MSAs and other agreements were entered into at various times between June 2013 and the present, were solely by way of compromise and settlement and were not an admission of liability or fault by us or any of our subsidiaries. All MSAs are subject to a process that includes guidelines and procedures for administering the settlements and the release of funds. In certain cases, the MSAs provide for the creation of QSFs into which the settlement funds will be deposited, establish participation requirements and allow for a reduction of the total settlement payment in the event participation thresholds are not met. Funds deposited in QSFs are considered restricted cash and/or restricted cash equivalents. Distribution of funds to any individual claimant is conditioned upon the receipt of documentation substantiating product use, the dismissal of any lawsuit and the release of the claim as to us and all affiliates. Prior to receiving funds, an individual claimant must represent and warrant that liens, assignment rights or other claims identified in the claims administration process have been or will be satisfied by the individual claimant. Confidentiality provisions apply to the settlement funds, amounts allocated to individual claimants and other terms of the agreements. In October 2019, the Ontario Superior Court of Justice approved a class action settlement covering unresolved claims by Canadian women implanted with an AMS vaginal mesh device. Astora funded the settlement in February 2020. The following table presents the changes in the QSFs and mesh liability accrual balances during the nine months ended September 30, 2020 (in thousands): Qualified Settlement Funds Mesh Liability Accrual Balance as of December 31, 2019 $ 242,842 $ 454,031 Additional charges — 30,454 Cash distributions to settle disputes from Qualified Settlement Funds (107,225) (107,225) Cash distributions to settle disputes — (26,559) Other (1) 726 616 Balance as of September 30, 2020 $ 136,343 $ 351,317 __________ (1) Amounts deposited in the QSFs may earn interest, which is generally used to pay administrative costs of the fund and is reflected in the table above as an increase to the QSF and Mesh Liability Accrual balances. Any interest remaining after all claims have been paid will generally be distributed to the claimants who participated in that settlement. Also included within this line are foreign currency adjustments for settlements not denominated in U.S. dollars. Charges related to vaginal mesh liability and associated legal fees and other expenses for all periods presented are reported in Discontinued operations, net of tax in our Condensed Consolidated Statements of Operations. As of September 30, 2020, the Company has made total cumulative mesh liability payments of approximately $3.6 billion, $136.3 million of which remains in the QSFs as of September 30, 2020. We currently expect to fund substantially all of the remaining payments under all previously executed settlement agreements into the QSFs during 2020 and 2021. As funds are disbursed out of the QSFs from time to time, the liability accrual will be reduced accordingly with a corresponding reduction to restricted cash and cash equivalents. In addition, we may pay cash distributions to settle disputes separate from the QSFs, which will also decrease the liability accrual and decrease cash and cash equivalents. We were contacted in October 2012 regarding a civil investigation initiated by various U.S. state attorneys general into mesh products, including transvaginal surgical mesh products designed to treat POP and SUI. In November 2013, we received a subpoena relating to this investigation from the state of California, and we subsequently received additional subpoenas from California and other states. We are cooperating with the investigations. We will continue to vigorously defend any unresolved claims and to explore other options as appropriate in our best interests. The earliest trial is currently scheduled for February 2021; however, the timing of trials is uncertain due to the impact of COVID-19 and other factors. Similar matters may be brought by others or the foregoing matters may be expanded. We are unable to predict the outcome of these matters or to estimate the possible range of any additional losses that could be incurred. Although the Company believes it has appropriately estimated the probable total amount of loss associated with all mesh-related matters as of the date of this report, litigation is ongoing in certain cases that have not settled, and it is reasonably possible that further claims may be filed or asserted and that adjustments to our overall liability accrual may be required. This could have a material adverse effect on our business, financial condition, results of operations and cash flows. Opioid-Related Matters Since 2014, multiple U.S. states as well as other governmental persons or entities and private plaintiffs in the U.S. and Canada have filed suit against us and/or certain of our subsidiaries, including Endo Health Solutions Inc. (EHSI), Endo Pharmaceuticals Inc. (EPI), PPI, Par Pharmaceutical Companies, Inc. (PPCI), Endo Generics Holdings, Inc. (EGHI), Vintage Pharmaceuticals, LLC, Generics Bidco I, LLC, DAVA Pharmaceuticals, LLC, Par Sterile Products, LLC (PSP LLC) and in Canada, Paladin, as well as various other manufacturers, distributors, pharmacies and/or others, asserting claims relating to defendants’ alleged sales, marketing and/or distribution practices with respect to prescription opioid medications, including certain of our products. As of October 30, 2020, filed cases in the U.S. of which we were aware include, but are not limited to, approximately 20 cases filed by or on behalf of states; approximately 2,870 cases filed by counties, cities, Native American tribes and/or other government-related persons or entities; approximately 295 cases filed by hospitals, health systems, unions, health and welfare funds or other third-party payers and approximately 175 cases filed by individuals. Certain of the cases have been filed as putative class actions. The Canadian cases include an action filed by British Columbia on behalf of a proposed class of all federal, provincial and territorial governments and agencies in Canada that paid healthcare, pharmaceutical and treatment costs related to opioids, an action filed by the City of Grand Prairie, Alberta on behalf of a proposed class of all local or municipal governments in Canada, as well as three additional putative class actions, filed in Ontario, Quebec and British Columbia, seeking relief on behalf of Canadian residents who were prescribed and/or consumed opioid medications. Many of the U.S. cases have been coordinated in a federal multidistrict litigation (MDL) pending in the U.S. District Court for the Northern District of Ohio. Other cases are pending in various federal or state courts. The cases are at various stages in the litigation process. The first MDL trial, relating to the claims of two Ohio counties (Track One plaintiffs), was set for October 2019 but did not go forward after most defendants settled. EPI, EHSI, PPI and PPCI executed a settlement agreement with the Track One plaintiffs in September 2019 which provided for payments totaling $10 million and up to $1 million of VASOSTRICT ® and/or ADRENALIN ® . Under the settlement agreement, the Track One plaintiffs may be entitled to additional payments in the event of a comprehensive resolution of government-related opioid claims. The settlement agreement was solely by way of compromise and settlement and was not in any way an admission of liability or fault by us or any of our subsidiaries. The earliest trial is currently scheduled for 2021; however, trials may occur earlier or later as timing remains uncertain due to the impact of COVID-19 and other factors. Most cases remain at the pleading and/or discovery stage. The complaints in the cases assert a variety of claims, including but not limited to statutory claims asserting violations of public nuisance, consumer protection, unfair trade practices, racketeering, Medicaid fraud and/or drug dealer liability laws and/or common law claims for public nuisance, fraud/misrepresentation, strict liability, negligence and/or unjust enrichment. The claims are generally based on alleged misrepresentations and/or omissions in connection with the sale and marketing of prescription opioid medications and/or alleged failures to take adequate steps to identify and report suspicious orders and to prevent abuse and diversion. Plaintiffs have generally sought various remedies including, without limitation, declaratory and/or injunctive relief; compensatory, punitive and/or treble damages; restitution, disgorgement, civil penalties, abatement, attorneys’ fees, costs and/or other relief. We will continue to vigorously defend the foregoing matters and to explore other options as appropriate in our best interests. Similar matters may be brought by others or the foregoing matters may be expanded. We are unable to predict the outcome of these matters or to estimate the possible range of any losses that could be incurred. Adjustments to our overall liability accrual may be required in the future, which could have a material adverse effect on our business, financial condition, results of operations and cash flows. In September 2019, EPI, EHSI, PPI and PPCI received subpoenas from the New York State Department of Financial Services (DFS) seeking documents and information regarding the marketing, sale and distribution of opioid medications in New York. In June 2020, DFS commenced an administrative action against the Company, EPI, EHSI, PPI and PPCI alleging violations of the New York Insurance Law and New York Financial Services Law. The statement of charges alleges that fraudulent or otherwise wrongful conduct in the marketing, sale and/or distribution of opioid medications caused false claims to be submitted to insurers and seeks civil penalties for each allegedly fraudulent prescription as well as injunctive relief. The action is currently set for hearing in January 2021. In addition to the lawsuits and administrative matters described above, the Company and/or its subsidiaries have received certain subpoenas, civil investigative demands (CIDs) and informal requests for information concerning the sale, marketing and/or distribution of prescription opioid medications, including the following: Various state attorneys general have served subpoenas and/or CIDs on EHSI and/or EPI. We are cooperating with the investigations. In January 2018, EPI received a federal grand jury subpoena from the U.S. District Court for the Southern District of Florida seeking documents and information related to OPANA ® ER, other oxymorphone products and marketing of opioid medications. We are cooperating with the investigation. Similar investigations may be brought by others or the foregoing matters may be expanded or result in litigation. We are unable to predict the outcome of these matters or to estimate the possible range of any losses that could be incurred. Adjustments to our overall liability accrual may be required in the future, which could have a material adverse effect on our business, financial condition, results of operations and cash flows. In January 2020, EPI and PPI executed a settlement agreement with the state of Oklahoma providing for a payment of approximately $8.75 million in resolution of potential opioid-related claims. The settlement agreement was solely by way of compromise and settlement and was not in any way an admission of liability or fault by us or any of our subsidiaries. Ranitidine Matters In June 2020, an MDL pending in the U.S. District Court for the Southern District of Florida, In re Zantac (Ranitidine) Products Liability Litigation , was expanded to add PPI and numerous other manufacturers and distributors of generic ranitidine as defendants. The claims are generally based on allegations that under certain conditions the active ingredient in Zantac ® and generic ranitidine medications can break down to form an alleged carcinogen known as N-Nitrosodimethylamine (NDMA). PPI and its subsidiaries have not manufactured or sold ranitidine since 2016. The MDL includes individual plaintiffs as well as putative classes of consumers and third-party payers. The complaints assert a variety of claims, including but not limited to various product liability, breach of warranty, fraud, negligence, statutory and unjust enrichment claims. Plaintiffs generally seek various remedies including, without limitation, compensatory, punitive and/or treble damages; restitution, disgorgement, civil penalties, abatement, attorneys’ fees and costs as well as injunctive and/or other relief. The MDL court has issued various case management orders, including a scheduling order for briefing of defendants’ motions to dismiss and orders allowing certain discovery to commence. We will continue to vigorously defend the foregoing matters and to explore other options as appropriate in our best interests. Similar matters may be brought by others or the foregoing matters may be expanded. We are unable to predict the outcome of these matters or to estimate the possible range of any losses that could be incurred. Adjustments to our overall liability accrual may be required in the future, which could have a material adverse effect on our business, financial condition, results of operations and cash flows. Generic Drug Pricing Matters Since March 2016, various private plaintiffs, state attorneys general and other governmental entities have filed cases against our subsidiary PPI and/or, in some instances, the Company, Generics Bidco I, LLC, DAVA Pharmaceuticals, LLC, EPI, EHSI and/or PPCI, as well as other pharmaceutical manufacturers and, in some instances, other corporate and/or individual defendants, alleging price-fixing and other anticompetitive conduct with respect to generic pharmaceutical products. These cases, which include proposed class actions filed on behalf of direct purchasers, end-payers and indirect purchaser resellers, as well as non-class action suits, have generally been consolidated and/or coordinated for pretrial proceedings in a federal MDL pending in the U.S. District Court for the Eastern District of Pennsylvania. There is also a proposed class action filed in the Federal Court of Canada on behalf of a proposed class of Canadian purchasers. The various complaints and amended complaints generally assert claims under federal and/or state antitrust law, state consumer protection statutes and/or state common law, and seek damages, treble damages, civil penalties, disgorgement, declaratory and injunctive relief, costs and attorneys’ fees. Some claims are based on alleged product-specific conspiracies and other claims allege broader, multiple-product conspiracies. Under these overarching conspiracy theories, plaintiffs generally seek to hold all alleged participants in a particular conspiracy jointly and severally liable for all harms caused by the alleged conspiracy, not just harms related to the products manufactured and/or sold by a particular defendant. The MDL court has issued various case management and substantive orders, including orders denying certain motions to dismiss, and discovery is ongoing. We will continue to vigorously defend the foregoing matters and to explore other options as appropriate in our best interests. Similar matters may be brought by others or the foregoing matters may be expanded. We are unable to predict the outcome of these matters or to estimate the possible range of any losses that could be incurred. Adjustments to our overall liability accrual may be required in the future, which could have a material adverse effect on our business, financial condition, results of operations and cash flows. In December 2014, our subsidiary PPI received from the Antitrust Division of the U.S. Department of Justice (DOJ) a federal grand jury subpoena issued by the U.S. District Court for the Eastern District of Pennsylvania addressed to “Par Pharmaceuticals.” The subpoena requested documents and information focused primarily on product and pricing information relating to the authorized generic version of Lanoxin ® (digoxin) oral tablets and generic doxycycline products, and on communications with competitors and others regarding those products. We are cooperating with the investigation. In May 2018, we and our subsidiary PPCI each received a CID from the DOJ in relation to a False Claims Act investigation concerning whether generic pharmaceutical manufacturers engaged in price-fixing and market allocation agreements, paid illegal remuneration and caused the submission of false claims. We are cooperating with the investigation. Similar investigations may be brought by others or the foregoing matters may be expanded or result in litigation. We are unable to predict the outcome of these matters or to estimate the possible range of any losses that could be incurred. Adjustments to our overall liability accrual may be required in the future, which could have a material adverse effect on our business, financial condition, results of operations and cash flows. Other Antitrust Matters Beginning in November 2013, multiple alleged purchasers of LIDODERM ® sued our subsidiary EPI and other pharmaceutical companies alleging violations of antitrust law arising out of the defendants’ settlement of certain patent infringement litigation. The various complaints asserted claims under Sections 1 and 2 of the Sherman Act, state antitrust and consumer protection statutes and/or state common law and sought damages, treble damages, disgorgement of profits, restitution, injunctive relief and attorneys’ fees. These cases were consolidated and/or coordinated in a federal MDL in the U.S. District Court for the Northern District of California. The last cases remaining in the MDL were dismissed with prejudice in September 2018, when the court approved EPI’s settlements with direct and indirect purchaser classes. Those settlement agreements provided for aggregate payments of approximately $100 million. Of this total, EPI paid approximately $60 million in 2018, $30 million in the first quarter of 2019 and $10 million in the first quarter of 2020. In September 2019, Blue Cross Blue Shield of Michigan and Blue Care Network of Michigan filed a complaint against EPI and other pharmaceutical companies in the Third Judicial Circuit Court, Wayne County, Michigan, asserting claims substantially similar to those asserted in the MDL. In October 2019, certain defendants removed the case to federal court; in April 2020, the case was remanded back to state court. In June 2020, defendants filed a motion for summary disposition, which was granted in part and denied in part in October 2020. Beginning in June 2014, multiple alleged purchasers of OPANA ® ER sued our subsidiaries EHSI and EPI and other pharmaceutical companies including Impax Laboratories, LLC (formerly Impax Laboratories, Inc. and referred to herein as Impax) and Penwest Pharmaceuticals Co., which our subsidiary EPI had acquired, alleging violations of antitrust law arising out of an agreement reached by EPI and Impax to settle certain patent infringement litigation and EPI’s introduction of reformulated OPANA ® ER. Some cases were filed on behalf of putative classes of direct and indirect purchasers, while others were filed on behalf of individual retailers or health care benefit plans. The cases have been consolidated and/or coordinated for pretrial proceedings in a federal MDL pending in the U.S. District Court for the Northern District of Illinois. The various complaints assert claims under Sections 1 and 2 of the Sherman Act, state antitrust and consumer protection statutes and/or state common law. Plaintiffs generally seek damages, treble damages, disgorgement of profits, restitution, injunctive relief and attorneys’ fees. In March 2019, direct and indirect purchaser plaintiffs filed motions for class certification, which remain pending. In April 2020, defendants filed motions for summary judgment, which remain pending. Beginning in February 2009, the Federal Trade Commission (FTC) and certain private plaintiffs sued our subsidiaries PPCI (since June 2016, EGHI) and/or PPI as well as other pharmaceutical companies alleging violations of antitrust law arising out of the settlement of certain patent litigation concerning the generic version of AndroGel ® and seeking damages, treble damages, equitable relief and attorneys’ fees and costs. The cases were consolidated and/or coordinated for pretrial proceedings in a federal MDL pending in the U.S. District Court for the Northern District of Georgia. In May 2016, plaintiffs representing a putative class of indirect purchasers voluntarily dismissed their claims with prejudice. In February 2017, the FTC voluntarily dismissed its claims against EGHI with prejudice. In June 2018, the MDL court granted in part and denied in part various summary judgment and evidentiary motions filed by defendants. In particular, among other things, the court rejected two of the remaining plaintiffs’ causation theories and rejected damages claims related to AndroGel ® 1.62%. In July 2018, the court denied certain plaintiffs’ motion for certification of a direct purchaser class. In November 2019, PPI and PPCI entered into settlement agreements with all but one of the remaining plaintiffs in the MDL. The settlement agreements were solely by way of compromise and settlement and were not in any way an admission of liability or fault. Separately, in August 2019, several alleged direct purchasers filed suit in the U.S. District Court for the Eastern District of Pennsylvania asserting claims substantially similar to those asserted in the MDL, as well as additional claims against other defendants relating to other alleged conduct. In January 2020, the U.S. District Court for the Eastern District of Pennsylvania denied defendants’ motion to transfer venue to the Northern District of Georgia. Beginning in February 2018, several alleged indirect purchasers filed proposed class actions against our subsidiary PPI and other pharmaceutical companies alleging violations of antitrust law arising out of the settlement of certain patent litigation concerning the generic version of Zetia ® (ezetimibe). The various complaints asserted claims under Sections 1 and 2 of the Sherman Act, state antitrust and consumer protection statutes and/or state common law and sought injunctive relief, damages, treble damages, attorneys’ fees and costs. In June 2018, these and other related cases, including proposed direct purchaser class actions in which PPI was not named as a defendant, were consolidated and/or coordinated for pretrial proceedings in a federal MDL in the U.S. District Court for the Eastern District of Virginia. In September 2018, the indirect purchaser plaintiffs dismissed their claims against PPI without prejudice. In June and July 2019, the MDL court granted the direct purchaser plaintiffs and certain retailer plaintiffs leave to file amended complaints adding PPI as a defendant. In July 2019, PPI entered into settlement agreements with both the direct purchaser plaintiffs and the retailer plaintiffs. In September 2020, United Health Care Services, Inc. (UHC) filed a separate complaint against various defendants, including PPI; this complaint was also transferred to the MDL for pretrial proceedings. In October 2020, PPI entered into a settlement agreement with UHC. The direct purchaser settlement was subject to court approval, which was granted in March 2020. The various settlement agreements were solely by way of compromise and settlement, were not in any way an admission of liability or fault and involved no monetary payment. Beginning in May 2018, multiple complaints were filed in the U.S. District Court for the Southern District of New York against PPI, EPI and/or us, as well as other pharmaceutical companies, alleging violations of antitrust law arising out of the settlement of certain patent litigation concerning the generic version of Exforge ® (amlodipine/valsartan). Some cases were filed on behalf of putative classes of direct and indirect purchasers; others are non-class action suits. The various complaints assert claims under Sections 1 and 2 of the Sherman Act, state antitrust and consumer protection statutes and/or state common law. Plaintiffs generally seek damages, treble damages, equitable relief and attorneys’ fees and costs. In September 2018, the putative class plaintiffs stipulated to the dismissal without prejudice of their claims against EPI and us, and the retailer plaintiffs later did the same. PPI filed a partial motion to dismiss certain claims in September 2018, which was granted in August 2019. The cases are currently in discovery. Beginning in August 2019, multiple complaints were filed in the U.S. District Court for the Southern District of New York against PPI and other pharmaceutical companies alleging violations of antitrust law arising out the settlement of certain patent litigation concerning generic versions of Seroquel XR ® (extended release quetiapine fumarate). The claims against PPI are based on allegations that PPI entered into an exclusive acquisition and license agreement with Handa Pharmaceuticals, LLC (Handa) in 2012 pursuant to which Handa assigned to PPI certain rights under a prior settlement agreement between Handa and AstraZeneca resolving certain patent litigation. Some cases were filed on behalf of putative classes of direct and indirect purchasers; others are non-class action suits. The various complaints assert claims under Sections 1 and 2 of the Sherman Act, state antitrust and consumer protection statutes and/or state common law. Plaintiffs generally seek damages, treble damages, equitable relief and attorneys’ fees and costs. In October 2019, the defendants filed various motions to dismiss and, in the alternative, moved to transfer the litigation to the U.S. District Court for the District of Delaware. In August 2020, the Southern District of New York granted the motion to transfer without ruling on the motions to dismiss. The cases are now pending in the District of Delaware. Beginning in June 2020, several alleged indirect purchasers filed proposed class actions against Jazz Pharmaceuticals and other pharmaceutical companies, including PPI, alleging violations of state and federal antitrust laws in connection with the settlement of certain patent litigations concerning generic versions of Xyrem ® (sodium oxybate). Certain complaints were filed in the U.S. District Court for the Northern District of Illinois; others were filed in the U.S. District Court for the Northern District of California or the U.S. District Court for the Southern District of New York. The various complaints allege that Jazz entered into a series of “reverse-payment” settlements, including with PPI, to delay generic competition for Xyrem ® and assert claims under Sections 1 and 2 of the Sherman Act, Section 16 of the Clayton Act, state antitrust and consumer protection statutes and/or state common law. Plaintiffs generally seek damages, treble damages, equitable relief and attorneys’ fees and costs. In July 2020, certain plaintiffs who had filed in the Northern District of Illinois voluntarily dismissed their cases and re-filed them in the Northern District of California. In August 2020, a plaintiff petitioned the Judicial Panel on Multidistrict Litigation (the JPML) to consolidate all related actions in the Southern District of New York. In October 2020, the actions filed in the Northern District of California were stayed pending a decision by the JPML. To the extent unresolved, we will continue to vigorously defend the foregoing matters and to explore other options as appropriate in our best interests. Similar matters may be brought by others or the foregoing matters may be expanded. We are unable to predict the outcome of these matters or to estimate the possible range of any losses that could be incurred. Adjustments to our overall liability accrual may be required in the future, which could have a material adverse effect on our business, financial condition, results of operations and cash flows. In February 2015, EGHI and affiliates received a CID from the Office of the Attorney General for the state of Alaska seeking documents and information regarding EGHI’s settlement of AndroGel ® patent litigation as well as documents produced in the aforementioned litigation filed by the FTC. Also in February 2015 |
Other Comprehensive Income (Los
Other Comprehensive Income (Loss) | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
OTHER COMPREHENSIVE INCOME (LOSS) | NOTE 14. OTHER COMPREHENSIVE INCOME (LOSS) During the three and nine months ended September 30, 2020 and 2019, there were no tax effects allocated to any component of Other comprehensive income (loss) and there were no reclassifications out of Accumulated other comprehensive loss. Substantially all of the Company’s Accumulated other comprehensive loss balances at September 30, 2020 and December 31, 2019 consist of Foreign currency translation loss. |
Shareholders' Deficit
Shareholders' Deficit | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
SHAREHOLDERS' DEFICIT | NOTE 15. SHAREHOLDERS' DEFICIT The following table presents a reconciliation of the beginning and ending balances in Total shareholders' deficit for the three and nine months ended September 30, 2020 (in thousands): Euro Deferred Shares Ordinary Shares Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Loss Total Shareholders' Deficit BALANCE, DECEMBER 31, 2019 $ 45 $ 23 $ 8,904,692 $ (9,552,214) $ (219,090) $ (866,544) Net income — — — 129,930 — 129,930 Other comprehensive loss — — — — (14,437) (14,437) Compensation related to share-based awards — — 17,645 — — 17,645 Tax withholding for restricted shares — — (4,398) — — (4,398) Other (1) — (12) — — (13) BALANCE, MARCH 31, 2020 $ 44 $ 23 $ 8,917,927 $ (9,422,284) $ (233,527) $ (737,817) Net income — — — 10,558 — 10,558 Other comprehensive income — — — — 5,624 5,624 Compensation related to share-based awards — — 9,222 — — 9,222 Tax withholding for restricted shares — — (2,467) — — (2,467) Other 1 — 12 — — 13 BALANCE, JUNE 30, 2020 $ 45 $ 23 $ 8,924,694 $ (9,411,726) $ (227,903) $ (714,867) Net loss — — — (75,887) — (75,887) Other comprehensive income — — — — 2,755 2,755 Compensation related to share-based awards — — 6,585 — — 6,585 Tax withholding for restricted shares — — (1,070) — — (1,070) Other 2 — — — — 2 BALANCE, SEPTEMBER 30, 2020 $ 47 $ 23 $ 8,930,209 $ (9,487,613) $ (225,148) $ (782,482) The following table presents a reconciliation of the beginning and ending balances in Total shareholders' deficit for the three and nine months ended September 30, 2019 (in thousands): Euro Deferred Shares Ordinary Shares Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Loss Total Shareholders' Deficit BALANCE, DECEMBER 31, 2018, PRIOR TO THE ADOPTION OF ASC 842 $ 46 $ 22 $ 8,855,810 $ (9,124,932) $ (229,229) $ (498,283) Effect of adopting ASC 842 — — — (4,646) — (4,646) BALANCE, JANUARY 1, 2019 $ 46 $ 22 $ 8,855,810 $ (9,129,578) $ (229,229) $ (502,929) Net loss — — — (18,573) — (18,573) Other comprehensive income — — — — 4,730 4,730 Compensation related to share-based awards — — 24,733 — — 24,733 Exercise of options — — 4 — — 4 Tax withholding for restricted shares — — (2,414) — — (2,414) Other (1) — — — — (1) BALANCE, MARCH 31, 2019 $ 45 $ 22 $ 8,878,133 $ (9,148,151) $ (224,499) $ (494,450) Net loss — — — (106,005) — (106,005) Other comprehensive income — — — — 4,395 4,395 Compensation related to share-based awards — — 12,600 — — 12,600 Tax withholding for restricted shares — — (7,013) — — (7,013) Other — 1 — — — 1 BALANCE, JUNE 30, 2019 $ 45 $ 23 $ 8,883,720 $ (9,254,156) $ (220,104) $ (590,472) Net loss — — — (79,415) — (79,415) Other comprehensive loss — — — — (2,515) (2,515) Compensation related to share-based awards — — 11,576 — — 11,576 Tax withholding for restricted shares — — (650) — — (650) Other (1) — — — — (1) BALANCE, SEPTEMBER 30, 2019 $ 44 $ 23 $ 8,894,646 $ (9,333,571) $ (222,619) $ (661,477) Share-Based Compensation The Company recognized share-based compensation expense of $6.6 million and $11.6 million during the three months ended September 30, 2020 and 2019, respectively, and $33.5 million and $48.9 million during the nine months ended September 30, 2020 and 2019, respectively. As of September 30, 2020, the total remaining unrecognized compensation cost related to non-vested share-based compensation awards amounted to $30.7 million. As of September 30, 2020, the weighted average remaining requisite service period for non-vested stock options was 0.4 years and for non-vested restricted stock units was 1.5 years. |
Other (Income) Expense, Net
Other (Income) Expense, Net | 9 Months Ended |
Sep. 30, 2020 | |
Component of Operating Income [Abstract] | |
OTHER (INCOME) EXPENSE, NET | NOTE 16. OTHER (INCOME) EXPENSE, NET The components of Other (income) expense, net for the three and nine months ended September 30, 2020 and 2019 are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Net gain on sale of business and other assets (1) $ (1,888) $ (1,933) $ (16,730) $ (3,101) Foreign currency loss (gain), net (2) 1,332 579 (1,491) 4,336 Net (gain) loss from our investments in the equity of other companies (3) (2,609) 191 (2,373) 2,546 Other miscellaneous, net (4) (4,029) 17,366 (4,724) 16,627 Other (income) expense, net $ (7,194) $ 16,203 $ (25,318) $ 20,408 __________ (1) Amounts primarily relate to the sales of certain intellectual property rights. (2) Amounts relate to the remeasurement of the Company’s foreign currency denominated assets and liabilities. (3) Amounts relate to the income statement impacts of our investments in the equity of other companies, including investments accounted for under the equity method. (4) Amounts during the three and nine months ended September 30, 2019 primarily relate to $17.5 million of contract termination costs incurred as a result of certain product discontinuation activities in our International Pharmaceuticals segment. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | NOTE 17. INCOME TAXES The following table displays our Loss from continuing operations before income tax, Income tax expense (benefit) and Effective tax rate for the three and nine months ended September 30, 2020 and 2019 (dollars in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Loss from continuing operations before income tax $ (64,800) $ (24,070) $ (18,299) $ (120,363) Income tax expense (benefit) $ 4,174 $ 17,361 $ (124,516) $ 31,732 Effective tax rate (6.4) % (72.1) % 680.5 % (26.4) % The change in Income tax expense (benefit) for the three months ended September 30, 2020 primarily relates to changes in the geographic mix of pre-tax earnings. The change in Income tax expense (benefit) for the nine months ended September 30, 2020 primarily relates to the 2020 discrete tax benefit arising from the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), as discussed below, and changes in the geographic mix of pre-tax earnings. We have valuation allowances established against our deferred tax assets in most jurisdictions in which we operate, with the exception of Canada and India. On March 27, 2020, the CARES Act was enacted by the U.S. government in response to the COVID-19 pandemic. The CARES Act, among other things, permits net operating loss (NOL) carryovers and carrybacks to offset 100% of taxable income for taxable years beginning before 2021. In addition, the CARES Act allows NOLs incurred in 2018, 2019 and 2020 to be carried back to each of the five preceding taxable years to generate a refund of previously paid income taxes. During the nine months ended September 30, 2020, the Company recorded a discrete tax benefit in continuing operations of $129.0 million as a result of the change in the NOL carryback period. On June 3, 2020, in connection with the Internal Revenue Service's (IRS) examination of our U.S. income tax return for the fiscal year ended December 31, 2015 (2015 Return), we received an acknowledgement of facts (AoF) from the IRS related to transfer pricing positions taken by Endo U.S., Inc. and its subsidiaries (Endo U.S.). The AoF asserted that Endo U.S. overpaid for certain pharmaceutical products that it purchased from certain non-U.S. related parties and proposed a specific adjustment to our 2015 U.S. income tax return position. On September 4, 2020, we received a Form 5701 Notice of Proposed Adjustment (NOPA) that is consistent with the previously disclosed AoF. We believe that the terms of the subject transactions are consistent with comparable transactions for similarly situated unrelated parties, and we intend to contest the proposed adjustment. While the NOPA is not material to our business, financial condition, results of operations or cash flows, the IRS could seek to apply its position to subsequent tax periods and propose similar adjustments. The aggregate impact of these adjustments, if sustained, could have a material adverse effect on our business, financial condition, results of operations and cash flows. Although the timing of the outcome of this matter is uncertain, it is possible any final resolution of the matter could take a number of years. |
Net (Loss) Income Per Share
Net (Loss) Income Per Share | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
NET (LOSS) INCOME PER SHARE | NOTE 18. NET (LOSS) INCOME PER SHARE The following is a reconciliation of the numerator and denominator of basic and diluted net (loss) income per share for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Numerator: (Loss) income from continuing operations $ (68,974) $ (41,431) $ 106,217 $ (152,095) Loss from discontinued operations, net of tax (6,913) (37,984) (41,616) (51,898) Net (loss) income $ (75,887) $ (79,415) $ 64,601 $ (203,993) Denominator: For basic per share data—weighted average shares 230,040 226,598 228,985 225,804 Dilutive effect of ordinary share equivalents — — 4,394 — For diluted per share data—weighted average shares 230,040 226,598 233,379 225,804 Basic per share amounts are computed based on the weighted average number of ordinary shares outstanding during the period. Diluted per share amounts are computed based on the weighted average number of ordinary shares outstanding and, if there is net income from continuing operations during the period, the dilutive effect of ordinary share equivalents outstanding during the period. The dilutive effect of ordinary share equivalents is measured using the treasury stock method. Stock options and awards that have been issued but for which a grant date has not yet been established are not considered in the calculation of basic or diluted weighted average shares. All potentially dilutive items were excluded from the diluted share calculation for the three months ended September 30, 2020 because their effect would have been anti-dilutive as the Company was in a loss position. For the nine months ended September 30, 2020, aggregate stock options and stock awards of 7.1 million and 6.4 million, respectively, were excluded from the diluted share calculation because their effect would have been anti-dilutive. All potentially dilutive items were excluded from the diluted share calculation for the three and nine months ended September 30, 2019 because their effect would have been anti-dilutive as the Company was in a loss position. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | NOTE 19. SUBSEQUENT EVENTS Plan to Acquire BioSpecifics Technologies Corp. On October 19, 2020, the Company entered into an Agreement and Plan of Merger (the Merger Agreement) with Beta Acquisition Corp., a Delaware corporation and wholly-owned indirect subsidiary of the Company (Purchaser) and BioSpecifics Technologies Corp., a Delaware corporation and a commercial-stage biopharmaceutical company (BioSpecifics). Pursuant to the Merger Agreement, and on the terms and subject to the conditions thereof, Purchaser commenced a tender offer (the Offer) on November 2, 2020 to acquire all of BioSpecifics’ issued and outstanding shares of common stock (BioSpecifics Shares) at a purchase price of $88.50 per BioSpecifics Share (Offer Price), net to the holder thereof in cash, subject to reduction for any applicable withholding taxes and without interest. Following the consummation of the Offer and subject to the satisfaction or waiver of certain conditions set forth in the Merger Agreement, Purchaser will merge with and into BioSpecifics, with BioSpecifics surviving as a wholly owned subsidiary of the Company, pursuant to Section 251(h) of the General Corporation Law of the State of Delaware without a vote of BioSpecifics’ stockholders (Merger). At the effective time of the Merger (Effective Time), and without any action on the part of the holders of BioSpecifics Shares, each BioSpecifics Share, other than any BioSpecifics Shares (i) owned at the commencement of the Offer and immediately prior to the Effective Time by the Company, Purchaser or BioSpecifics or any direct or indirect wholly-owned subsidiary thereof, (ii) irrevocably accepted for purchase pursuant to the Offer or (iii) owned by BioSpecifics stockholders who are entitled to demand and have properly and validly demanded their appraisal rights under Delaware law, will be automatically converted into the right to receive an amount in cash equal to the Offer Price, subject to reduction for any applicable withholding taxes and without interest. The Company has had a strategic relationship with BioSpecifics since 2004. Under the terms of the relationship, BioSpecifics receives a royalty stream from the Company related to the Company’s collagenase-based therapies, which currently include XIAFLEX ® , currently marketed by the Company for the treatment of Dupuytren’s contracture and Peyronie’s disease, and Qwo™ (collagenase clostridium histolyticum-aaes), the first FDA-approved injectable treatment for cellulite, which is expected to be launched in spring 2021. In connection with the Merger Agreement, the Marital Trust U/W/O Edwin H. Wegman Dated 8-10-06 (Stockholder) entered into a support agreement with the Company and Purchaser (Support Agreement). The Support Agreement generally requires that the Stockholder validly tender all of its shares after commencement of the Offer and to vote against any action, agreement or transaction involving BioSpecifics that can impede, interfere with or prevent the consummation of the transaction. The Stockholder beneficially owned, in the aggregate, 935,073 BioSpecifics Shares, which represented approximately 12.7% of BioSpecifics’ total outstanding shares based on 7,344,955 outstanding shares as of October 28, 2020. The transaction is expected to close in late 2020, subject to customary closing conditions, and the Company expects to fund the transaction with cash on hand. The estimated value of the transaction is approximately $540 million (net of approximately $120 million in estimated cash, cash equivalents and investments acquired) at the anticipated time of deal closure. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (10-Q) (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Changes and Error Corrections [Abstract] | |
Use of Estimates | Use of Estimates The preparation of our Condensed Consolidated Financial Statements in conformity with U.S. GAAP requires us to make estimates that affect the amounts and disclosures in the Condensed Consolidated Financial Statements, including the notes thereto, and elsewhere in this report. Uncertainties related to the continued magnitude and duration of the COVID-19 pandemic, the extent to which it will impact our estimated future financial results, worldwide macroeconomic conditions including interest rates, employment rates, consumer spending, health insurance coverage, the speed of the anticipated recovery and governmental and business reactions to the pandemic, including any possible re-initiation of shutdowns or renewed restrictions, have increased the complexity of developing these estimates, including the allowance for expected credit losses and the carrying amounts of long-lived assets, goodwill and other intangible assets. Actual results may differ significantly from our estimates, including as a result of COVID-19. |
Accounts Receivable | Accounts Receivable. The Company adopted Accounting Standards Codification (ASC) Topic 326, Financial Instruments-Credit Losses (ASC 326) on January 1, 2020. For further discussion of the adoption, refer to the “Recent Accounting Pronouncements Adopted or Otherwise Effective as of September 30, 2020” section below. Subsequent to the adoption of ASC 326, our accounts receivable balance is stated at amortized cost less an allowance for expected credit losses. In addition, our accounts receivable balance is reduced by certain sales deduction reserves where we have the right of offset with the customer. We generally do not require collateral. |
Concentration of Credit Risk and Credit Losses | Concentrations of Credit Risk and Credit Losses. Financial instruments that potentially subject us to significant concentrations of credit risk consist primarily of cash equivalents, restricted cash equivalents and accounts receivable. From time to time, we invest our excess cash in high-quality, liquid money market instruments maintained by major banks and financial institutions. We have not experienced any losses on our cash equivalents. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Adopted or Otherwise Effective as of September 30, 2020 In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-13, Measurement of Credit Losses on Financial Instruments (ASU 2016-13). ASU 2016-13, together with a series of subsequently-issued related ASUs, has been codified in ASC 326. ASC 326 establishes new requirements for companies to estimate expected credit losses when measuring certain financial assets, including accounts receivable. The Company adopted ASC 326 using a modified retrospective approach with an effective date of January 1, 2020. The adoption of ASC 326 did not have a material impact on the Company’s Condensed Consolidated Financial Statements. |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of disposal groups, including discontinued operations, income statement, balance sheet and additional disclosures | The following table provides the operating results of Astora Discontinued operations, net of tax, for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Litigation-related and other contingencies, net $ — $ 30,000 $ 28,351 $ 30,400 Loss from discontinued operations before income taxes $ (7,134) $ (37,984) $ (47,158) $ (51,898) Income tax benefit $ (221) $ — $ (5,542) $ — Discontinued operations, net of tax $ (6,913) $ (37,984) $ (41,616) $ (51,898) |
Restructuring (Tables)
Restructuring (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Restructuring and Related Activities [Abstract] | |
Restructuring and Related Costs | As a result of the 2020 Restructuring Initiative, the Company incurred the following pre-tax net charges during the three and nine months ended September 30, 2020 (in thousands): Three Months Ended September 30, 2020 Nine Months Ended September 30, 2020 Accelerated depreciation charges $ 6,291 $ 14,676 Asset impairment charges 7,391 7,391 Employee separation, continuity and other benefit-related costs (1) 53,647 53,647 Total $ 67,329 $ 75,714 __________ (1) As of September 30, 2020, all employee-related costs have been recognized in accordance with ASC 712. During the three and nine months ended September 30, 2020, the pre-tax net charges related to the 2020 Restructuring Initiative were included in our Condensed Consolidated Statements of Operations as follows (in thousands): Three Months Ended September 30, 2020 Nine Months Ended September 30, 2020 Cost of revenues $ 36,172 $ 42,198 Selling, general and administrative 20,185 22,130 Research and development 3,581 3,995 Asset impairment charges 7,391 7,391 Total $ 67,329 $ 75,714 |
Schedule of Restructuring Reserve by Type of Cost | Changes to the liability for the 2020 Restructuring Initiative during the nine months ended September 30, 2020 were as follows (in thousands): Employee Separation, Continuity and Other Benefit-Related Costs Total Liability balance as of December 31, 2019 $ — $ — Net charges 53,647 53,647 Liability balance as of September 30, 2020 $ 53,647 $ 53,647 |
Segment Results (Tables)
Segment Results (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
Schedule of reportable segments information | The following represents selected information for the Company’s reportable segments for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Net revenues from external customers: Branded Pharmaceuticals $ 223,682 $ 217,313 $ 557,276 $ 629,851 Sterile Injectables 251,393 263,635 906,997 777,963 Generic Pharmaceuticals 135,508 218,012 602,670 654,322 International Pharmaceuticals (1) 24,277 30,466 75,910 87,428 Total net revenues from external customers $ 634,860 $ 729,426 $ 2,142,853 $ 2,149,564 Segment adjusted income (loss) from continuing operations before income tax: Branded Pharmaceuticals $ 120,368 $ 105,864 $ 267,964 $ 302,682 Sterile Injectables 190,498 197,974 696,147 566,345 Generic Pharmaceuticals (13,428) 29,569 91,293 129,702 International Pharmaceuticals 10,679 11,511 34,180 35,053 Total segment adjusted income (loss) from continuing operations before income tax $ 308,117 $ 344,918 $ 1,089,584 $ 1,033,782 __________ (1) Revenues generated by our International Pharmaceuticals segment are primarily attributable to external customers located in Canada. The table below provides reconciliations of our Total consolidated loss from continuing operations before income tax, which is determined in accordance with U.S. GAAP, to our Total segment adjusted income (loss) from continuing operations before income tax for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Total consolidated loss from continuing operations before income tax $ (64,800) $ (24,070) $ (18,299) $ (120,363) Interest expense, net 135,648 136,903 397,689 404,387 Corporate unallocated costs (1) 39,976 37,891 116,888 124,351 Amortization of intangible assets 104,066 131,932 325,801 417,949 Upfront and milestone payments to partners 275 1,672 2,469 4,055 Continuity and separation benefits and other cost reduction initiatives (2) 67,692 11,023 100,356 15,172 Certain litigation-related and other contingencies, net (3) 1,810 (14,414) (23,938) (4,093) Certain legal costs (4) 18,343 14,556 51,884 50,229 Asset impairment charges (5) 8,412 4,766 106,197 258,652 Acquisition-related and integration items, net (6) (1,407) 16,025 17,100 (26,983) Gain on extinguishment of debt — — — (119,828) Foreign currency impact related to the remeasurement of intercompany debt instruments 1,663 (922) (2,426) 2,874 Other, net (7) (3,561) 29,556 15,863 27,380 Total segment adjusted income (loss) from continuing operations before income tax $ 308,117 $ 344,918 $ 1,089,584 $ 1,033,782 __________ (1) Amounts include certain corporate overhead costs, such as headcount, facility and corporate litigation expenses and certain other income and expenses. (2) Included within this line are costs associated with certain continuity and transitional compensation arrangements for certain senior management of the Company, including $4.3 million and $22.2 million during the three and nine months ended September 30, 2020, respectively, and $6.7 million during both the three and nine months ended September 30, 2019. Other amounts primarily relate to the 2020 Restructuring Initiative and certain other cost reduction initiatives, including employee separation, continuity and other benefit-related costs of $53.6 million, accelerated depreciation of $6.3 million and miscellaneous charges of $3.4 million during the three months ended September 30, 2020; employee separation, continuity and other benefit-related costs of $53.6 million, accelerated depreciation of $14.7 million and miscellaneous charges of $9.8 million during the nine months ended September 30, 2020; miscellaneous charges of $4.3 million during the three months ended September 30, 2019; and employee separation, continuity and other benefit-related costs of $2.2 million and miscellaneous charges of $6.3 million during the nine months ended September 30, 2019. Refer to Note 4. Restructuring for further discussion of the 2020 Restructuring Initiative. (3) Amounts include adjustments to our accruals for litigation-related settlement charges and certain settlement proceeds related to suits filed by our subsidiaries. Our material legal proceedings and other contingent matters are described in more detail in Note 13. Commitments and Contingencies. (4) Amounts relate to opioid-related legal expenses. (5) Amounts primarily relate to charges to impair goodwill and intangible assets and operating lease right-of-use assets as further described in Note 9. Goodwill and Other Intangibles and Note 8. Leases, respectively. (6) Amounts primarily relate to changes in the fair value of contingent consideration. |
Disaggregation of revenue | The Company believes these categories depict how the nature, timing and uncertainty of revenue and cash flows are affected by economic factors. Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Branded Pharmaceuticals: Specialty Products: XIAFLEX® $ 88,167 $ 82,756 $ 211,022 $ 226,118 SUPPRELIN® LA 28,229 20,772 63,344 66,542 Other Specialty (1) 23,724 28,470 68,795 78,397 Total Specialty Products $ 140,120 $ 131,998 $ 343,161 $ 371,057 Established Products: PERCOCET® $ 27,508 $ 28,561 $ 82,789 $ 88,199 TESTOPEL® 18,068 13,236 26,877 40,830 Other Established (2) 37,986 43,518 104,449 129,765 Total Established Products $ 83,562 $ 85,315 $ 214,115 $ 258,794 Total Branded Pharmaceuticals (3) $ 223,682 $ 217,313 $ 557,276 $ 629,851 Sterile Injectables: VASOSTRICT® $ 155,412 $ 129,691 $ 572,530 $ 384,854 ADRENALIN® 30,662 40,311 120,335 133,468 Ertapenem for injection 16,784 21,853 46,648 79,619 APLISOL® 9,443 28,085 25,821 55,996 Other Sterile Injectables (4) 39,092 43,695 141,663 124,026 Total Sterile Injectables (3) $ 251,393 $ 263,635 $ 906,997 $ 777,963 Total Generic Pharmaceuticals (5) $ 135,508 $ 218,012 $ 602,670 $ 654,322 Total International Pharmaceuticals (6) $ 24,277 $ 30,466 $ 75,910 $ 87,428 Total revenues, net $ 634,860 $ 729,426 $ 2,142,853 $ 2,149,564 __________ (1) Products included within Other Specialty are NASCOBAL ® Nasal Spray and AVEED ® . (2) Products included within Other Established include, but are not limited to, EDEX ® and LIDODERM ® . (3) Individual products presented above represent the top two performing products in each product category for either the three or nine months ended September 30, 2020 and/or any product having revenues in excess of $25 million during any quarterly period in 2020 or 2019. (4) Products included within Other Sterile Injectables include ephedrine sulfate injection and others. (5) The Generic Pharmaceuticals segment is comprised of a portfolio of products that are generic versions of branded products, are distributed primarily through the same wholesalers, generally have no intellectual property protection and are sold within the U.S. During the three and nine months ended September 30, 2019, colchicine tablets (the authorized generic of Takeda Pharmaceuticals U.S.A., Inc.’s (Takeda) Colcrys ® ), which launched in July 2018, made up 7% and 6% of consolidated total revenues, respectively. No other individual product within this segment has exceeded 5% of consolidated total revenues for the periods presented. (6) The International Pharmaceuticals segment, which accounted for less than 5% of consolidated total revenues for each of the periods presented, includes a variety of specialty pharmaceutical products sold outside the U.S., primarily in Canada through our operating company Paladin. |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Schedule of cash and cash equivalents | The following table presents current and noncurrent restricted cash and cash equivalent balances at September 30, 2020 and December 31, 2019 (in thousands): Condensed Consolidated Balance Sheets Line Items September 30, 2020 December 31, 2019 Restricted cash and cash equivalents—current Restricted cash and cash equivalents $ 162,648 $ 247,457 Restricted cash and cash equivalents—noncurrent Other assets 18,400 18,400 Total restricted cash and cash equivalents $ 181,048 $ 265,857 The restricted cash and cash equivalents amounts primarily relate to litigation-related matters, including approximately $136.3 million and $242.8 million held in Qualified Settlement Funds (QSFs) for mesh-related matters at September 30, 2020 and December 31, 2019, respectively. See Note 13. Commitments and Contingencies for further information about mesh-related and other litigation-related matters. Additionally, at September 30, 2020, approximately $25.0 million of restricted cash and cash equivalents related to certain insurance-related matters. |
Restrictions on cash and cash equivalents | The following table presents current and noncurrent restricted cash and cash equivalent balances at September 30, 2020 and December 31, 2019 (in thousands): Condensed Consolidated Balance Sheets Line Items September 30, 2020 December 31, 2019 Restricted cash and cash equivalents—current Restricted cash and cash equivalents $ 162,648 $ 247,457 Restricted cash and cash equivalents—noncurrent Other assets 18,400 18,400 Total restricted cash and cash equivalents $ 181,048 $ 265,857 The restricted cash and cash equivalents amounts primarily relate to litigation-related matters, including approximately $136.3 million and $242.8 million held in Qualified Settlement Funds (QSFs) for mesh-related matters at September 30, 2020 and December 31, 2019, respectively. See Note 13. Commitments and Contingencies for further information about mesh-related and other litigation-related matters. Additionally, at September 30, 2020, approximately $25.0 million of restricted cash and cash equivalents related to certain insurance-related matters. |
Financial assets and liabilities measured at fair value on recurring basis | The Company’s financial assets and liabilities measured at fair value on a recurring basis at September 30, 2020 and December 31, 2019 were as follows (in thousands): Fair Value Measurements at September 30, 2020 using: Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Money market funds $ 628,875 $ — $ — $ 628,875 Liabilities: Acquisition-related contingent consideration—current $ — $ — $ 9,665 $ 9,665 Acquisition-related contingent consideration—noncurrent $ — $ — $ 28,044 $ 28,044 Fair Value Measurements at December 31, 2019 using: Level 1 Inputs Level 2 Inputs Level 3 Inputs Total Assets: Money market funds $ 427,033 $ — $ — $ 427,033 Liabilities: Acquisition-related contingent consideration—current $ — $ — $ 6,534 $ 6,534 Acquisition-related contingent consideration—noncurrent $ — $ — $ 23,123 $ 23,123 |
Changes to liability for acquisition-related contingent consideration | The following table presents changes to the Company’s liability for acquisition-related contingent consideration, which is measured at fair value on a recurring basis using significant unobservable inputs (Level 3), for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Beginning of period $ 42,057 $ 52,930 $ 29,657 $ 116,703 Amounts settled (3,103) (9,376) (8,785) (30,541) Changes in fair value recorded in earnings (1,407) 16,025 17,100 (26,983) Effect of currency translation 162 (85) (263) 315 End of period $ 37,709 $ 59,494 $ 37,709 $ 59,494 The following table presents changes to the Company’s liability for acquisition-related contingent consideration during the nine months ended September 30, 2020 by acquisition (in thousands): Balance as of December 31, 2019 Changes in Fair Value Recorded in Earnings Amounts Settled and Other Balance as of September 30, 2020 Auxilium acquisition $ 13,207 $ 4,223 $ (1,644) $ 15,786 Lehigh Valley Technologies, Inc. acquisitions 6,800 11,950 (5,250) 13,500 Other 9,650 927 (2,154) 8,423 Total $ 29,657 $ 17,100 $ (9,048) $ 37,709 |
Summary of nonrecurring fair value measurements | The Company’s financial assets and liabilities measured at fair value on a nonrecurring basis during the nine months ended September 30, 2020 were as follows (in thousands): Fair Value Measurements during the Nine Months Ended September 30, 2020 (1) using: Total Expense for the Nine Months Ended September 30, 2020 Level 1 Inputs Level 2 Inputs Level 3 Inputs Intangible assets, excluding goodwill (2) $ — $ — $ 24,377 $ (65,771) Certain property, plant and equipment — — — (1,248) Operating lease right-of-use assets — — — (6,392) Total $ — $ — $ 24,377 $ (73,411) __________ (1) The fair value amounts are presented as of the date of the fair value measurement as these assets are not measured at fair value on a recurring basis. Such measurements generally occur in connection with our quarter-end financial reporting close procedures. (2) These fair value measurements were determined using risk-adjusted discount rates ranging from approximately 10.0% to 15.0% (weighted average rate of approximately 12.2%, weighted based on relative fair value). The Company also performed fair value measurements in connection with its goodwill impairment tests. Refer to Note 9. Goodwill and Other Intangibles for additional information on goodwill and other intangible asset impairment tests, including information about the valuation methodologies utilized. |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Inventory Disclosure [Abstract] | |
Schedule of inventory | Inventories consist of the following at September 30, 2020 and December 31, 2019 (in thousands): September 30, 2020 December 31, 2019 Raw materials (1) $ 108,961 $ 124,171 Work-in-process (1) 75,913 65,392 Finished goods (1) 170,029 138,302 Total $ 354,903 $ 327,865 __________ (1) The components of inventory shown in the table above are net of allowance for obsolescence. |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Assets and liabilities, lessee | The following table presents information about the Company's right-of-use (ROU) assets and lease liabilities at September 30, 2020 and December 31, 2019 (in thousands): Condensed Consolidated Balance Sheets Line Items September 30, 2020 December 31, 2019 ROU assets: Operating lease ROU assets Operating lease assets $ 38,927 $ 51,700 Finance lease ROU assets Property, plant and equipment, net 49,860 56,793 Total ROU assets $ 88,787 $ 108,493 Operating lease liabilities: Current operating lease liabilities Current portion of operating lease liabilities $ 11,449 $ 10,763 Noncurrent operating lease liabilities Operating lease liabilities, less current portion 40,222 48,299 Total operating lease liabilities $ 51,671 $ 59,062 Finance lease liabilities: Current finance lease liabilities Accounts payable and accrued expenses $ 6,081 $ 5,672 Noncurrent finance lease liabilities Other liabilities 26,617 31,312 Total finance lease liabilities $ 32,698 $ 36,984 |
Lease, cost | The following table presents information about lease costs and expenses and sublease income for the three and nine months ended September 30, 2020 and 2019 (in thousands): Condensed Consolidated Statements of Operations Line Items Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Operating lease cost Various (1) $ 3,339 $ 3,510 $ 10,443 $ 10,269 Finance lease cost: Amortization of ROU assets Various (1) $ 2,311 $ 2,311 $ 6,933 $ 7,096 Interest on lease liabilities Interest expense, net $ 416 $ 271 $ 1,323 $ 1,256 Other lease costs and income: Variable lease costs (2) Various (1) $ 2,601 $ 2,318 $ 7,443 $ 7,185 Operating lease ROU asset impairment charges Asset impairment charges $ 6,392 $ — $ 6,392 $ — Sublease income Various (1) $ (1,077) $ (932) $ (2,870) $ (2,828) __________ (1) Amounts are included in the Condensed Consolidated Statements of Operations based on the function that the underlying leased asset supports. The following table presents the components of such aggregate amounts for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Cost of revenues $ 2,815 $ 2,793 $ 8,589 $ 8,425 Selling, general and administrative $ 4,309 $ 4,347 $ 13,209 $ 13,145 Research and development $ 50 $ 67 $ 151 $ 152 (2) Amounts represent variable lease costs incurred that were not included in the initial measurement of the lease liability such as common area maintenance and utilities costs associated with leased real estate and certain costs associated with our automobile leases. The following table provides certain cash flow and supplemental noncash information related to our lease liabilities for the nine months ended September 30, 2020 and 2019 (in thousands): Nine Months Ended September 30, 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash payments for operating leases $ 10,819 $ 11,200 Operating cash payments for finance leases $ 1,982 $ 1,535 Financing cash payments for finance leases $ 3,626 $ 7,826 Lease liabilities arising from obtaining right-of-use assets: Operating leases $ — $ 623 Finance leases $ — $ 5,901 |
Goodwill and Other Intangibles
Goodwill and Other Intangibles (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of changes in the carrying amount of goodwill | Changes in the carrying amount of our goodwill for the nine months ended September 30, 2020 were as follows (in thousands): Branded Pharmaceuticals Sterile Injectables Generic Pharmaceuticals International Pharmaceuticals Total Goodwill as of December 31, 2019 $ 828,818 $ 2,731,193 $ — $ 35,173 $ 3,595,184 Effect of currency translation — — — (2,387) (2,387) Goodwill impairment charges — — — (32,786) (32,786) Goodwill as of September 30, 2020 $ 828,818 $ 2,731,193 $ — $ — $ 3,560,011 The carrying amounts of goodwill at September 30, 2020 and December 31, 2019 are net of the following accumulated impairments (in thousands): Branded Pharmaceuticals Sterile Injectables Generic Pharmaceuticals International Pharmaceuticals Total Accumulated impairment losses as of December 31, 2019 $ 855,810 $ — $ 3,142,657 $ 500,417 $ 4,498,884 Accumulated impairment losses as of September 30, 2020 $ 855,810 $ — $ 3,142,657 $ 522,184 $ 4,520,651 |
Schedule of other intangible assets | Changes in the amount of other intangible assets for the nine months ended September 30, 2020 were as follows (in thousands): Cost basis: Balance as of December 31, 2019 Acquisitions Impairments Other (1) Effect of Currency Translation Balance as of September 30, 2020 Indefinite-lived intangibles: In-process research and development $ 93,900 $ — $ — $ (90,900) $ — $ 3,000 Total indefinite-lived intangibles $ 93,900 $ — $ — $ (90,900) $ — $ 3,000 Finite-lived intangibles: Licenses (weighted average life of 14 years) $ 457,402 $ — $ (8,700) $ — $ — $ 448,702 Tradenames 6,409 — — — — 6,409 Developed technology (weighted average life of 11 years) 5,844,439 — (57,071) (15,428) (6,633) 5,765,307 Total finite-lived intangibles (weighted average life of 11 years) $ 6,308,250 $ — $ (65,771) $ (15,428) $ (6,633) $ 6,220,418 Total other intangibles $ 6,402,150 $ — $ (65,771) $ (106,328) $ (6,633) $ 6,223,418 Accumulated amortization: Balance as of December 31, 2019 Amortization Impairments Other (1) Effect of Currency Translation Balance as of September 30, 2020 Finite-lived intangibles: Licenses $ (410,336) $ (6,162) $ — $ — $ — $ (416,498) Tradenames (6,409) — — — — (6,409) Developed technology (3,414,138) (319,639) — 108,328 3,800 (3,621,649) Total other intangibles $ (3,830,883) $ (325,801) $ — $ 108,328 $ 3,800 $ (4,044,556) Net other intangibles $ 2,571,267 $ 2,178,862 __________ (1) Amounts include reclassification adjustments of $90.9 million from In-process research and development to Developed technology for certain assets that were placed in service during the nine months ended September 30, 2020. The remaining amounts primarily relate to the removal of certain fully amortized Developed technology intangible assets. |
Schedule of future amortization expense | For intangible assets subject to amortization, estimated amortization expense for the five fiscal years subsequent to December 31, 2019 is as follows (in thousands): 2020 $ 428,828 2021 $ 394,331 2022 $ 379,640 2023 $ 336,465 2024 $ 298,198 |
Schedule of intangible asset impairment charges including goodwill | During the three and nine months ended September 30, 2020 and 2019, the Company incurred the following goodwill and other intangible asset impairment charges (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Goodwill impairment charges $ — $ — $ 32,786 $ 151,108 Other intangible asset impairment charges $ 2,020 $ 4,261 $ 65,771 $ 104,660 |
Contract Assets and Liabiliti_2
Contract Assets and Liabilities (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Contract with Customer, Contract Asset, Contract Liability, and Receivable [Abstract] | |
Contract assets and liabilities | The following table shows the opening and closing balances of contract assets and contract liabilities from contracts with customers (dollars in thousands): September 30, 2020 December 31, 2019 $ Change % Change Contract assets, net (1) $ 13,625 $ — $ 13,625 NM Contract liabilities, net (2) $ 7,725 $ 6,592 $ 1,133 17 % __________ NM indicates that the percentage change is not meaningful or is greater than 100%. (1) At September 30, 2020, approximately $2.6 million of this contract asset amount is classified as current and is included in Prepaid expenses and other current assets in the Company’s Condensed Consolidated Balance Sheets. The remaining amount is classified as noncurrent and is included in Other assets. The net increase in contract assets during the nine months ended September 30, 2020 was primarily due to the Company’s estimated consideration for the sale of certain intellectual property rights. (2) At September 30, 2020 and December 31, 2019, approximately $2.9 million and $1.4 million, respectively, of these contract liability amounts are classified as current and are included in Accounts payable and accrued expenses in the Company’s Condensed Consolidated Balance Sheets. The remaining amounts are classified as noncurrent and are included in Other liabilities. The increase in contract liabilities during the nine months ended September 30, 2020 was primarily due to a new agreement entered into during the nine months ended September 30, 2020, partially offset by approximately $0.4 million in revenue recognized during the period. |
Accounts Payable and Accrued _2
Accounts Payable and Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Accounts Payable and Accrued Liabilities, Current [Abstract] | |
Schedule of accounts payable and accrued liabilities | Accounts payable and accrued expenses include the following at September 30, 2020 and December 31, 2019 (in thousands): September 30, 2020 December 31, 2019 Trade accounts payable $ 104,621 $ 101,532 Returns and allowances 205,962 206,248 Rebates 119,265 129,056 Chargebacks 2,589 1,594 Accrued interest 135,199 112,860 Accrued payroll and related benefits 112,256 79,869 Accrued royalties and other distribution partner payables 61,355 115,816 Acquisition-related contingent consideration—current 9,665 6,534 Other 117,492 146,440 Total $ 868,404 $ 899,949 |
Debt (Tables)
Debt (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt instruments | The following table presents information about the Company’s total indebtedness at September 30, 2020 and December 31, 2019 (dollars in thousands): September 30, 2020 December 31, 2019 Effective Interest Rate Principal Amount Carrying Amount Effective Interest Rate Principal Amount Carrying Amount 7.25% Senior Notes due 2022 7.25 % $ 8,294 $ 8,294 7.25 % $ 8,294 $ 8,294 5.75% Senior Notes due 2022 5.75 % 172,048 172,048 5.75 % 182,479 182,479 5.375% Senior Notes due 2023 5.62 % 6,127 6,095 5.62 % 210,440 209,018 6.00% Senior Notes due 2023 6.28 % 56,436 56,029 6.28 % 1,439,840 1,426,998 5.875% Senior Secured Notes due 2024 6.14 % 300,000 297,109 6.14 % 300,000 296,647 6.00% Senior Notes due 2025 6.27 % 21,578 21,354 6.27 % 1,200,000 1,185,726 7.50% Senior Secured Notes due 2027 7.70 % 2,015,479 1,994,514 7.71 % 1,500,000 1,482,212 9.50% Senior Secured Second Lien Notes due 2027 9.68 % 940,590 932,175 — — 6.00% Senior Notes due 2028 6.11 % 1,260,416 1,251,498 — — Term Loan Facility 5.21 % 3,304,013 3,281,385 6.21 % 3,329,625 3,302,675 Revolving Credit Facility 2.69 % 300,000 300,000 4.25 % 300,000 300,000 Total long-term debt, net $ 8,384,981 $ 8,320,501 $ 8,470,678 $ 8,394,049 Less current portion, net 34,150 34,150 34,150 34,150 Total long-term debt, less current portion, net $ 8,350,831 $ 8,286,351 $ 8,436,528 $ 8,359,899 |
Schedule of maturities of long-term debt | The following table presents, as of September 30, 2020, the maturities on our long-term debt for each of the five fiscal years subsequent to December 31, 2019 (in thousands): Maturities (1)(2) 2020 (3) $ 34,150 2021 $ 34,150 2022 (4) $ 237,292 2023 $ 96,713 2024 (4) $ 3,770,225 __________ (1) Certain amounts borrowed pursuant to the Credit Facilities will immediately mature if certain of our senior notes are not refinanced or repaid in full prior to the date that is 91 days prior to the respective stated maturity dates thereof. Accordingly, we may seek to repay or refinance certain senior notes prior to their stated maturity dates. The amounts in this maturities table do not reflect any such early repayment or refinancing; rather, they reflect stated maturity dates. (2) With respect to the notes impacted by the Exchange Offers and the August 2020 Tender Offer, amounts included in the table above represent maturities as of September 30, 2020 after giving effect to such transactions. (3) With respect to the Term Loan Facility, amounts in 2020 include both payments made through September 30, 2020 and expected payments for the remainder of 2020. (4) Based on the Company’s borrowings under the Revolving Credit Facility that were outstanding at September 30, 2020, $22.8 million will mature in 2022, with the remainder maturing in 2024. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Changes in qualified settlement funds accounts and product liability balance | The following table presents the changes in the QSFs and mesh liability accrual balances during the nine months ended September 30, 2020 (in thousands): Qualified Settlement Funds Mesh Liability Accrual Balance as of December 31, 2019 $ 242,842 $ 454,031 Additional charges — 30,454 Cash distributions to settle disputes from Qualified Settlement Funds (107,225) (107,225) Cash distributions to settle disputes — (26,559) Other (1) 726 616 Balance as of September 30, 2020 $ 136,343 $ 351,317 __________ (1) Amounts deposited in the QSFs may earn interest, which is generally used to pay administrative costs of the fund and is reflected in the table above as an increase to the QSF and Mesh Liability Accrual balances. Any interest remaining after all claims have been paid will generally be distributed to the claimants who participated in that settlement. Also included within this line are foreign currency adjustments for settlements not denominated in U.S. dollars. |
Shareholders' Deficit (Tables)
Shareholders' Deficit (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Schedule of Stockholders Equity | The following table presents a reconciliation of the beginning and ending balances in Total shareholders' deficit for the three and nine months ended September 30, 2020 (in thousands): Euro Deferred Shares Ordinary Shares Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Loss Total Shareholders' Deficit BALANCE, DECEMBER 31, 2019 $ 45 $ 23 $ 8,904,692 $ (9,552,214) $ (219,090) $ (866,544) Net income — — — 129,930 — 129,930 Other comprehensive loss — — — — (14,437) (14,437) Compensation related to share-based awards — — 17,645 — — 17,645 Tax withholding for restricted shares — — (4,398) — — (4,398) Other (1) — (12) — — (13) BALANCE, MARCH 31, 2020 $ 44 $ 23 $ 8,917,927 $ (9,422,284) $ (233,527) $ (737,817) Net income — — — 10,558 — 10,558 Other comprehensive income — — — — 5,624 5,624 Compensation related to share-based awards — — 9,222 — — 9,222 Tax withholding for restricted shares — — (2,467) — — (2,467) Other 1 — 12 — — 13 BALANCE, JUNE 30, 2020 $ 45 $ 23 $ 8,924,694 $ (9,411,726) $ (227,903) $ (714,867) Net loss — — — (75,887) — (75,887) Other comprehensive income — — — — 2,755 2,755 Compensation related to share-based awards — — 6,585 — — 6,585 Tax withholding for restricted shares — — (1,070) — — (1,070) Other 2 — — — — 2 BALANCE, SEPTEMBER 30, 2020 $ 47 $ 23 $ 8,930,209 $ (9,487,613) $ (225,148) $ (782,482) The following table presents a reconciliation of the beginning and ending balances in Total shareholders' deficit for the three and nine months ended September 30, 2019 (in thousands): Euro Deferred Shares Ordinary Shares Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Loss Total Shareholders' Deficit BALANCE, DECEMBER 31, 2018, PRIOR TO THE ADOPTION OF ASC 842 $ 46 $ 22 $ 8,855,810 $ (9,124,932) $ (229,229) $ (498,283) Effect of adopting ASC 842 — — — (4,646) — (4,646) BALANCE, JANUARY 1, 2019 $ 46 $ 22 $ 8,855,810 $ (9,129,578) $ (229,229) $ (502,929) Net loss — — — (18,573) — (18,573) Other comprehensive income — — — — 4,730 4,730 Compensation related to share-based awards — — 24,733 — — 24,733 Exercise of options — — 4 — — 4 Tax withholding for restricted shares — — (2,414) — — (2,414) Other (1) — — — — (1) BALANCE, MARCH 31, 2019 $ 45 $ 22 $ 8,878,133 $ (9,148,151) $ (224,499) $ (494,450) Net loss — — — (106,005) — (106,005) Other comprehensive income — — — — 4,395 4,395 Compensation related to share-based awards — — 12,600 — — 12,600 Tax withholding for restricted shares — — (7,013) — — (7,013) Other — 1 — — — 1 BALANCE, JUNE 30, 2019 $ 45 $ 23 $ 8,883,720 $ (9,254,156) $ (220,104) $ (590,472) Net loss — — — (79,415) — (79,415) Other comprehensive loss — — — — (2,515) (2,515) Compensation related to share-based awards — — 11,576 — — 11,576 Tax withholding for restricted shares — — (650) — — (650) Other (1) — — — — (1) BALANCE, SEPTEMBER 30, 2019 $ 44 $ 23 $ 8,894,646 $ (9,333,571) $ (222,619) $ (661,477) |
Other (Income) Expense, Net (Ta
Other (Income) Expense, Net (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Component of Operating Income [Abstract] | |
Schedule of components of other income, net | The components of Other (income) expense, net for the three and nine months ended September 30, 2020 and 2019 are as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Net gain on sale of business and other assets (1) $ (1,888) $ (1,933) $ (16,730) $ (3,101) Foreign currency loss (gain), net (2) 1,332 579 (1,491) 4,336 Net (gain) loss from our investments in the equity of other companies (3) (2,609) 191 (2,373) 2,546 Other miscellaneous, net (4) (4,029) 17,366 (4,724) 16,627 Other (income) expense, net $ (7,194) $ 16,203 $ (25,318) $ 20,408 __________ (1) Amounts primarily relate to the sales of certain intellectual property rights. (2) Amounts relate to the remeasurement of the Company’s foreign currency denominated assets and liabilities. (3) Amounts relate to the income statement impacts of our investments in the equity of other companies, including investments accounted for under the equity method. (4) Amounts during the three and nine months ended September 30, 2019 primarily relate to $17.5 million of contract termination costs incurred as a result of certain product discontinuation activities in our International Pharmaceuticals segment. |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The following table displays our Loss from continuing operations before income tax, Income tax expense (benefit) and Effective tax rate for the three and nine months ended September 30, 2020 and 2019 (dollars in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Loss from continuing operations before income tax $ (64,800) $ (24,070) $ (18,299) $ (120,363) Income tax expense (benefit) $ 4,174 $ 17,361 $ (124,516) $ 31,732 Effective tax rate (6.4) % (72.1) % 680.5 % (26.4) % |
Net (Loss) Income Per Share (Ta
Net (Loss) Income Per Share (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Reconciliation of the numerator and denominator of basic and diluted net loss per share | The following is a reconciliation of the numerator and denominator of basic and diluted net (loss) income per share for the three and nine months ended September 30, 2020 and 2019 (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2020 2019 2020 2019 Numerator: (Loss) income from continuing operations $ (68,974) $ (41,431) $ 106,217 $ (152,095) Loss from discontinued operations, net of tax (6,913) (37,984) (41,616) (51,898) Net (loss) income $ (75,887) $ (79,415) $ 64,601 $ (203,993) Denominator: For basic per share data—weighted average shares 230,040 226,598 228,985 225,804 Dilutive effect of ordinary share equivalents — — 4,394 — For diluted per share data—weighted average shares 230,040 226,598 233,379 225,804 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (10-Q) (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Restricted cash and cash equivalents | $ 162,648 | $ 247,457 |
Credit Concentration Risk | Trade Accounts Receivable | Three Major Customers, Cardinal Health, Inc., McKesson Corporation And AmerisourceBergen Corporation | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Concentration risk, percentage | 90.00% | 88.00% |
Discontinued Operations - Astor
Discontinued Operations - Astora - Discontinued Operations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Loss from discontinued operations, net of tax | $ (6,913) | $ (37,984) | $ (41,616) | $ (51,898) |
Discontinued operations, disposed of by means other than sale, abandonment | Astora | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Litigation-related and other contingencies, net | 0 | 30,000 | 28,351 | 30,400 |
Loss from discontinued operations before income taxes | (7,134) | (37,984) | (47,158) | (51,898) |
Income tax benefit | (221) | 0 | (5,542) | 0 |
Loss from discontinued operations, net of tax | $ (6,913) | $ (37,984) | $ (41,616) | $ (51,898) |
Discontinued Operations - Ast_2
Discontinued Operations - Astora (Narrative) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Restructuring Cost and Reserve [Line Items] | ||||
Loss from discontinued operations, net of tax | $ (6,913,000) | $ (37,984,000) | $ (41,616,000) | $ (51,898,000) |
Discontinued operations, disposed of by means other than sale, abandonment | Astora | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Loss from discontinued operations, net of tax | $ (6,913,000) | $ (37,984,000) | (41,616,000) | (51,898,000) |
Cash used in investing activities | 0 | 0 | ||
Depreciation and amortization | $ 0 | $ 0 |
Restructuring - Narrative (Deta
Restructuring - Narrative (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($)position | Sep. 30, 2019USD ($) | |
Restructuring Cost and Reserve [Line Items] | ||||
Accelerated depreciation charges | $ 6,300 | $ 14,700 | ||
Asset impairment charges | 8,412 | $ 4,766 | $ 106,197 | $ 258,652 |
2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and related cost, expected number of positions eliminated | position | 560 | |||
Restructuring charges | 67,329 | $ 75,714 | ||
Accelerated depreciation charges | 6,291 | 14,676 | ||
Asset impairment charges | 7,391 | 7,391 | ||
Employee separation, continuity and other benefit-related costs | 53,647 | 53,647 | ||
Restructuring reserve, current | 29,500 | 29,500 | ||
Cost of revenues | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 36,172 | 42,198 | ||
Selling, general and administrative | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 20,185 | 22,130 | ||
Minimum | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and related costs, expected cost savings | 85,000 | 85,000 | ||
Restructuring charges | 163,000 | |||
Accelerated depreciation charges | 56,000 | |||
Employee separation, continuity and other benefit-related costs | 85,000 | |||
Payments for restructuring | 100,000 | |||
Minimum | Cost of revenues | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and related costs, expected cost savings | 65,000 | 65,000 | ||
Minimum | Selling, general and administrative | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and related costs, expected cost savings | 20,000 | 20,000 | ||
Maximum | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and related costs, expected cost savings | 95,000 | 95,000 | ||
Restructuring charges | 183,000 | |||
Accelerated depreciation charges | 66,000 | |||
Employee separation, continuity and other benefit-related costs | 90,000 | |||
Payments for restructuring | 110,000 | |||
Maximum | Cost of revenues | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and related costs, expected cost savings | 70,000 | 70,000 | ||
Maximum | Selling, general and administrative | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and related costs, expected cost savings | 25,000 | 25,000 | ||
Employee separation, continuity and other benefit-related costs | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 53,647 | |||
Restructuring and related cost, cost incurred to date | 53,600 | 53,600 | ||
Other restructuring charges | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 3,400 | $ 4,300 | 9,800 | $ 6,300 |
Other restructuring charges | Minimum | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 15,000 | |||
Other restructuring charges | Maximum | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 20,000 | |||
Accelerated depreciation charges | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and related cost, cost incurred to date | 14,700 | 14,700 | ||
Asset impairment charges | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and related cost, cost incurred to date | 7,400 | 7,400 | ||
Generic Pharmaceuticals | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 57,800 | 66,200 | ||
Restructuring and related cost, cost incurred to date | $ 66,200 | 66,200 | ||
Operating segments | Generic Pharmaceuticals | Minimum | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | 125,000 | |||
Operating segments | Generic Pharmaceuticals | Maximum | 2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 140,000 |
Restructuring - Pre-tax Net Cha
Restructuring - Pre-tax Net Charges Related to November 2020 Restructuring Initiative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Restructuring Cost and Reserve [Line Items] | ||||
Accelerated depreciation charges | $ 6,300 | $ 14,700 | ||
Asset impairment charges | 8,412 | $ 4,766 | 106,197 | $ 258,652 |
2020 Restructuring Initiative | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Accelerated depreciation charges | 6,291 | 14,676 | ||
Asset impairment charges | 7,391 | 7,391 | ||
Employee separation, continuity and other benefit-related costs | 53,647 | 53,647 | ||
Restructuring costs and asset impairment charges | $ 67,329 | $ 75,714 |
Restructuring - Pre-tax Net C_2
Restructuring - Pre-tax Net Charges Included in the Condensed Consolidated Statement of Operations (Details) - 2020 Restructuring Initiative - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2020 | Sep. 30, 2020 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | $ 67,329 | $ 75,714 |
Cost of revenues | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | 36,172 | 42,198 |
Selling, general and administrative | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | 20,185 | 22,130 |
Research and development | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | 3,581 | 3,995 |
Asset impairment charges | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring charges | $ 7,391 | $ 7,391 |
Restructuring - Changes to the
Restructuring - Changes to the Liability for November 2020 Restructuring Initiative (Details) - 2020 Restructuring Initiative - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2020 | Sep. 30, 2020 | |
Restructuring Reserve [Roll Forward] | ||
Restructuring charges | $ 67,329 | $ 75,714 |
Employee separation, continuity and other benefit-related costs | ||
Restructuring Reserve [Roll Forward] | ||
Beginning liability balance | 0 | |
Restructuring charges | 53,647 | |
Ending liability balance | $ 53,647 | $ 53,647 |
Segment Results - Schedule of R
Segment Results - Schedule of Reportable Segments Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($)segment | Sep. 30, 2019USD ($) | |
Segment Reporting Information [Line Items] | ||||
Number of reportable segments | segment | 4 | |||
Total net revenues from external customers | $ 634,860 | $ 729,426 | $ 2,142,853 | $ 2,149,564 |
Total segment adjusted income (loss) from continuing operations before income tax | 308,117 | 344,918 | 1,089,584 | 1,033,782 |
Branded Pharmaceuticals | ||||
Segment Reporting Information [Line Items] | ||||
Certain legal costs | 14,400 | 49,300 | ||
Total net revenues from external customers | 223,682 | 217,313 | 557,276 | 629,851 |
Total segment adjusted income (loss) from continuing operations before income tax | 120,368 | 105,864 | 267,964 | 302,682 |
Sterile Injectables | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenues from external customers | 251,393 | 263,635 | 906,997 | 777,963 |
Total segment adjusted income (loss) from continuing operations before income tax | 190,498 | 197,974 | 696,147 | 566,345 |
Generic Pharmaceuticals | ||||
Segment Reporting Information [Line Items] | ||||
Certain legal costs | 100 | 1,000 | ||
Total net revenues from external customers | 135,508 | 218,012 | 602,670 | 654,322 |
Total segment adjusted income (loss) from continuing operations before income tax | (13,428) | 29,569 | 91,293 | 129,702 |
International Pharmaceuticals | ||||
Segment Reporting Information [Line Items] | ||||
Total net revenues from external customers | 24,277 | 30,466 | 75,910 | 87,428 |
Total segment adjusted income (loss) from continuing operations before income tax | $ 10,679 | $ 11,511 | $ 34,180 | $ 35,053 |
Segment Results - Schedule of_2
Segment Results - Schedule of Reconciliations of Consolidated Adjusted Income (Loss) Before Income Tax (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Segment Reporting Information [Line Items] | ||||
Total consolidated loss from continuing operations before income tax | $ (64,800) | $ (24,070) | $ (18,299) | $ (120,363) |
Amortization of intangible assets | 104,100 | 131,900 | 325,801 | 417,900 |
Asset impairment charges | 8,412 | 4,766 | 106,197 | 258,652 |
Acquisition-related costs | (1,407) | 16,025 | 17,100 | (26,983) |
Gain on extinguishment of debt | 0 | 0 | 0 | (119,828) |
Total segment adjusted income (loss) from continuing operations before income tax | 308,117 | 344,918 | 1,089,584 | 1,033,782 |
Accelerated depreciation charges | 6,300 | 14,700 | ||
Payments of debt restructuring costs | 31,100 | |||
Other nonrecurring (income) expense, expired insurance premium | 14,100 | |||
International Pharmaceuticals | ||||
Segment Reporting Information [Line Items] | ||||
Total segment adjusted income (loss) from continuing operations before income tax | 10,679 | 11,511 | 34,180 | 35,053 |
Retention bonus | ||||
Segment Reporting Information [Line Items] | ||||
Restructuring charges | 4,300 | 6,700 | 22,200 | 6,700 |
Other restructuring charges | ||||
Segment Reporting Information [Line Items] | ||||
Restructuring charges | 3,400 | 4,300 | 9,800 | 6,300 |
Employee severance | ||||
Segment Reporting Information [Line Items] | ||||
Restructuring charges | 53,600 | 53,600 | 2,200 | |
Contract termination | ||||
Segment Reporting Information [Line Items] | ||||
Restructuring charges | 17,500 | 17,500 | ||
Contract termination | International Pharmaceuticals | ||||
Segment Reporting Information [Line Items] | ||||
Restructuring charges | 17,500 | 17,500 | ||
Premium on an expiring insurance program | ||||
Segment Reporting Information [Line Items] | ||||
Restructuring charges | 14,100 | |||
Segment reconciling items | ||||
Segment Reporting Information [Line Items] | ||||
Interest expense, net | 135,648 | 136,903 | 397,689 | 404,387 |
Corporate unallocated costs | 39,976 | 37,891 | 116,888 | 124,351 |
Amortization of intangible assets | 104,066 | 131,932 | 325,801 | 417,949 |
Upfront and milestone payments to partners | 275 | 1,672 | 2,469 | 4,055 |
Continuity and separation benefits and other cost reduction initiatives | 67,692 | 11,023 | 100,356 | 15,172 |
Certain litigation-related and other contingencies, net | 1,810 | (14,414) | (23,938) | (4,093) |
Certain legal costs | 18,343 | 14,556 | 51,884 | 50,229 |
Asset impairment charges | 8,412 | 4,766 | 106,197 | 258,652 |
Acquisition-related costs | (1,407) | 16,025 | 17,100 | (26,983) |
Gain on extinguishment of debt | 0 | 0 | 0 | (119,828) |
Foreign currency impact related to the remeasurement of intercompany debt instruments | 1,663 | (922) | (2,426) | 2,874 |
Other, net | (3,561) | 29,556 | 15,863 | 27,380 |
Operating segments | ||||
Segment Reporting Information [Line Items] | ||||
Total segment adjusted income (loss) from continuing operations before income tax | $ 308,117 | $ 344,918 | $ 1,089,584 | $ 1,033,782 |
Segment Results - Schedule of D
Segment Results - Schedule of Disaggregation of Revenues (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | $ 634,860,000 | $ 729,426,000 | $ 2,142,853,000 | $ 2,149,564,000 | |||||
Product line revenue reporting threshold | 25,000,000 | $ 25,000,000 | $ 25,000,000 | $ 25,000,000 | 25,000,000 | $ 25,000,000 | $ 25,000,000 | ||
Branded Pharmaceuticals | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 223,682,000 | 217,313,000 | 557,276,000 | 629,851,000 | |||||
Branded Pharmaceuticals | Specialty Products | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 140,120,000 | 131,998,000 | 343,161,000 | 371,057,000 | |||||
Branded Pharmaceuticals | XIAFLEX® | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 88,167,000 | 82,756,000 | 211,022,000 | 226,118,000 | |||||
Branded Pharmaceuticals | SUPPRELIN® LA | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 28,229,000 | 20,772,000 | 63,344,000 | 66,542,000 | |||||
Branded Pharmaceuticals | Other Specialty | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 23,724,000 | 28,470,000 | 68,795,000 | 78,397,000 | |||||
Branded Pharmaceuticals | Established Products | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 83,562,000 | 85,315,000 | 214,115,000 | 258,794,000 | |||||
Branded Pharmaceuticals | PERCOCET® | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 27,508,000 | 28,561,000 | 82,789,000 | 88,199,000 | |||||
Branded Pharmaceuticals | TESTOPEL® | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 18,068,000 | 13,236,000 | 26,877,000 | 40,830,000 | |||||
Branded Pharmaceuticals | Other Established | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 37,986,000 | 43,518,000 | 104,449,000 | 129,765,000 | |||||
Sterile Injectables | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 251,393,000 | 263,635,000 | 906,997,000 | 777,963,000 | |||||
Sterile Injectables | Vasostrict® | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 155,412,000 | 129,691,000 | 572,530,000 | 384,854,000 | |||||
Sterile Injectables | ADRENALIN® | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 30,662,000 | 40,311,000 | 120,335,000 | 133,468,000 | |||||
Sterile Injectables | Ertapenem for injection | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 16,784,000 | 21,853,000 | 46,648,000 | 79,619,000 | |||||
Sterile Injectables | APLISOL® | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 9,443,000 | 28,085,000 | 25,821,000 | 55,996,000 | |||||
Sterile Injectables | Other Sterile Injectables | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 39,092,000 | 43,695,000 | 141,663,000 | 124,026,000 | |||||
Generic Pharmaceuticals | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | 135,508,000 | $ 218,012,000 | 602,670,000 | $ 654,322,000 | |||||
Generic Pharmaceuticals | Colchicine Tablets | Revenue Benchmark | Product Concentration Risk | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
Concentration risk, percentage | 7.00% | 6.00% | |||||||
International Pharmaceuticals | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
TOTAL REVENUES, NET | $ 24,277,000 | $ 30,466,000 | $ 75,910,000 | $ 87,428,000 | |||||
International Pharmaceuticals | Revenue Benchmark | Product Concentration Risk | Maximum | |||||||||
Disaggregation of Revenue [Line Items] | |||||||||
Concentration risk, percentage | 5.00% |
Fair Value Measurements - Restr
Fair Value Measurements - Restricted Cash and Cash Equivalents (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash and cash equivalents, current | $ 162,648 | $ 247,457 |
Restricted cash and cash equivalents, noncurrent | 18,400 | 18,400 |
Restricted cash and cash equivalents | 181,048 | 265,857 |
Restricted Cash and Cash Equivalents, Insurance Coverage | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash and cash equivalents | 25,000 | |
Vaginal mesh cases | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Settlement funds | $ 136,343 | $ 242,842 |
Fair Value Measurements - (Narr
Fair Value Measurements - (Narrative) (Details) $ in Millions | Sep. 30, 2020USD ($) | Dec. 31, 2019USD ($) |
Discount rate | Minimum | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Discount rate applied | 0.100 | |
Discount rate | Maximum | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Discount rate applied | 0.150 | |
Discount rate | Weighted average | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Discount rate applied | 0.118 | |
Money market funds | Restricted cash and cash equivalents | ||
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items] | ||
Settlement funds | $ 30.2 | $ 70.2 |
Fair Value Measurements - Finan
Fair Value Measurements - Financial Assets And Liabilities Measured At Fair Value On Recurring Basis (Details) - Fair value, measurements, recurring - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Acquisition-related contingent consideration—current | ||
Liabilities: | ||
Fair value of financial liabilities measured on recurring basis | $ 9,665 | $ 6,534 |
Acquisition-related contingent consideration—noncurrent | ||
Liabilities: | ||
Fair value of financial liabilities measured on recurring basis | 28,044 | 23,123 |
Money market funds | ||
Assets: | ||
Fair value of financial assets measured on recurring basis | 628,875 | 427,033 |
Level 1 Inputs | Acquisition-related contingent consideration—current | ||
Liabilities: | ||
Fair value of financial liabilities measured on recurring basis | 0 | 0 |
Level 1 Inputs | Acquisition-related contingent consideration—noncurrent | ||
Liabilities: | ||
Fair value of financial liabilities measured on recurring basis | 0 | 0 |
Level 1 Inputs | Money market funds | ||
Assets: | ||
Fair value of financial assets measured on recurring basis | 628,875 | 427,033 |
Level 2 Inputs | Acquisition-related contingent consideration—current | ||
Liabilities: | ||
Fair value of financial liabilities measured on recurring basis | 0 | 0 |
Level 2 Inputs | Acquisition-related contingent consideration—noncurrent | ||
Liabilities: | ||
Fair value of financial liabilities measured on recurring basis | 0 | 0 |
Level 2 Inputs | Money market funds | ||
Assets: | ||
Fair value of financial assets measured on recurring basis | 0 | 0 |
Level 3 Inputs | Acquisition-related contingent consideration—current | ||
Liabilities: | ||
Fair value of financial liabilities measured on recurring basis | 9,665 | 6,534 |
Level 3 Inputs | Acquisition-related contingent consideration—noncurrent | ||
Liabilities: | ||
Fair value of financial liabilities measured on recurring basis | 28,044 | 23,123 |
Level 3 Inputs | Money market funds | ||
Assets: | ||
Fair value of financial assets measured on recurring basis | $ 0 | $ 0 |
Fair Value Measurements - Fin_2
Fair Value Measurements - Financial Liabilities Measured At Fair Value On Recurring Basis Using Significant Unobservable Inputs (Details) - Acquisition-related contingent consideration - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning of period | $ 42,057 | $ 52,930 | $ 29,657 | $ 116,703 |
Amounts settled | (3,103) | (9,376) | (8,785) | (30,541) |
Changes in fair value recorded in earnings | (1,407) | 16,025 | 17,100 | (26,983) |
Effect of currency translation | 162 | (85) | (263) | 315 |
Changes in Fair Value Recorded in Earnings | 17,100 | |||
Amounts Settled and Other | (9,048) | |||
End of period | 37,709 | $ 59,494 | 37,709 | $ 59,494 |
Auxilium acquisition | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning of period | 13,207 | |||
Changes in Fair Value Recorded in Earnings | 4,223 | |||
Amounts Settled and Other | (1,644) | |||
End of period | 15,786 | 15,786 | ||
Lehigh Valley Technologies, Inc. acquisitions | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning of period | 6,800 | |||
Changes in Fair Value Recorded in Earnings | 11,950 | |||
Amounts Settled and Other | (5,250) | |||
End of period | 13,500 | 13,500 | ||
Other | ||||
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | ||||
Beginning of period | 9,650 | |||
Changes in Fair Value Recorded in Earnings | 927 | |||
Amounts Settled and Other | (2,154) | |||
End of period | $ 8,423 | $ 8,423 |
Fair Value Measurements - Sched
Fair Value Measurements - Schedule of Financial Assets Measured At Fair Value On A Nonrecurring Basis (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | |
Assets: | ||||
Intangible assets, excluding goodwill | $ 2,020 | $ 4,261 | $ 65,771 | $ 104,660 |
Operating lease right-of-use assets | 6,392 | 0 | 6,392 | 0 |
Total | $ 8,412 | $ 4,766 | 106,197 | $ 258,652 |
Fair value, measurements, nonrecurring | ||||
Assets: | ||||
Intangible assets, excluding goodwill | 65,771 | |||
Certain property, plant and equipment | 1,248 | |||
Operating lease right-of-use assets | 6,392 | |||
Total | 73,411 | |||
Level 1 Inputs | Fair value, measurements, nonrecurring | ||||
Assets: | ||||
Intangible assets, excluding goodwill | 0 | |||
Certain property, plant and equipment | 0 | |||
Operating lease right-of-use assets | 0 | |||
Total | 0 | |||
Level 2 Inputs | Fair value, measurements, nonrecurring | ||||
Assets: | ||||
Intangible assets, excluding goodwill | 0 | |||
Certain property, plant and equipment | 0 | |||
Operating lease right-of-use assets | 0 | |||
Total | 0 | |||
Level 3 Inputs | Fair value, measurements, nonrecurring | ||||
Assets: | ||||
Intangible assets, excluding goodwill | 24,377 | |||
Certain property, plant and equipment | 0 | |||
Operating lease right-of-use assets | 0 | |||
Total | $ 24,377 | |||
Discount rate | Minimum | Fair value, measurements, nonrecurring | ||||
Assets: | ||||
Discount rate applied | 0.100 | 0.100 | ||
Discount rate | Maximum | Fair value, measurements, nonrecurring | ||||
Assets: | ||||
Discount rate applied | 0.150 | 0.150 | ||
Discount rate | Weighted average | Fair value, measurements, nonrecurring | ||||
Assets: | ||||
Discount rate applied | 0.122 | 0.122 |
Inventories (Details)
Inventories (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 108,961 | $ 124,171 |
Work-in-process | 75,913 | 65,392 |
Finished goods | 170,029 | 138,302 |
Total | 354,903 | 327,865 |
Long-term inventory | 34,600 | 29,000 |
Inventories not yet available for sale | $ 39,000 | $ 17,600 |
Leases - Assets and Liabilities
Leases - Assets and Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
ROU assets: | ||
Operating lease ROU assets | $ 38,927 | $ 51,700 |
Finance lease ROU assets | 49,860 | 56,793 |
Total ROU assets | 88,787 | 108,493 |
Operating lease liabilities: | ||
Current operating lease liabilities | 11,449 | 10,763 |
Noncurrent operating lease liabilities | 40,222 | 48,299 |
Total operating lease liabilities | 51,671 | 59,062 |
Finance lease liabilities: | ||
Current finance lease liabilities | 6,081 | 5,672 |
Noncurrent finance lease liabilities | 26,617 | 31,312 |
Total finance lease liabilities | $ 32,698 | $ 36,984 |
Leases - Components of Lease Ex
Leases - Components of Lease Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Leases [Abstract] | ||||
Operating lease cost | $ 3,339 | $ 3,510 | $ 10,443 | $ 10,269 |
Finance lease cost: | ||||
Amortization of ROU assets | 2,311 | 2,311 | 6,933 | 7,096 |
Interest on lease liabilities | 416 | 271 | 1,323 | 1,256 |
Other lease costs and income: | ||||
Variable lease costs | 2,601 | 2,318 | 7,443 | 7,185 |
Operating lease ROU asset impairment charges | 6,392 | 0 | 6,392 | 0 |
Sublease income | (1,077) | (932) | (2,870) | (2,828) |
Cost of revenues | ||||
Lessee, Lease, Description [Line Items] | ||||
Lease, cost | 2,815 | 2,793 | 8,589 | 8,425 |
Selling, general and administrative | ||||
Lessee, Lease, Description [Line Items] | ||||
Lease, cost | 4,309 | 4,347 | 13,209 | 13,145 |
Research and development | ||||
Lessee, Lease, Description [Line Items] | ||||
Lease, cost | $ 50 | $ 67 | $ 151 | $ 152 |
Leases - Cash Flow and Suppleme
Leases - Cash Flow and Supplemental Noncash Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash paid for amounts included in the measurement of lease liabilities: | ||
Operating cash payments for operating leases | $ 10,819 | $ 11,200 |
Operating cash payments for finance leases | 1,982 | 1,535 |
Financing cash payments for finance leases | 3,626 | 7,826 |
Lease liabilities arising from obtaining right-of-use assets: | ||
Operating leases | 0 | 623 |
Finance leases | $ 0 | $ 5,901 |
Goodwill and Other Intangible_2
Goodwill and Other Intangibles - Schedule of Changes in the Carrying Amount of Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Goodwill [Roll Forward] | ||||
Goodwill, beginning balance | $ 3,595,184 | |||
Effect of currency translation | (2,387) | |||
Goodwill impairment charges | $ 0 | $ 0 | (32,786) | $ (151,108) |
Goodwill, ending balance | 3,560,011 | 3,560,011 | ||
Branded Pharmaceuticals | ||||
Goodwill [Roll Forward] | ||||
Goodwill, beginning balance | 828,818 | |||
Effect of currency translation | 0 | |||
Goodwill impairment charges | 0 | |||
Goodwill, ending balance | 828,818 | 828,818 | ||
Sterile Injectables | ||||
Goodwill [Roll Forward] | ||||
Goodwill, beginning balance | 2,731,193 | |||
Effect of currency translation | 0 | |||
Goodwill impairment charges | 0 | |||
Goodwill, ending balance | 2,731,193 | 2,731,193 | ||
Generic Pharmaceuticals | ||||
Goodwill [Roll Forward] | ||||
Goodwill, beginning balance | 0 | |||
Effect of currency translation | 0 | |||
Goodwill impairment charges | 0 | |||
Goodwill, ending balance | 0 | 0 | ||
International Pharmaceuticals | ||||
Goodwill [Roll Forward] | ||||
Goodwill, beginning balance | 35,173 | |||
Effect of currency translation | (2,387) | |||
Goodwill impairment charges | (32,786) | |||
Goodwill, ending balance | $ 0 | $ 0 |
Goodwill and Other Intangible_3
Goodwill and Other Intangibles - Accumulated Impairment (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Goodwill [Line Items] | ||
Accumulated impairment losses | $ 4,520,651 | $ 4,498,884 |
Branded Pharmaceuticals | ||
Goodwill [Line Items] | ||
Accumulated impairment losses | 855,810 | 855,810 |
Sterile Injectables | ||
Goodwill [Line Items] | ||
Accumulated impairment losses | 0 | 0 |
Generic Pharmaceuticals | ||
Goodwill [Line Items] | ||
Accumulated impairment losses | 3,142,657 | 3,142,657 |
International Pharmaceuticals | ||
Goodwill [Line Items] | ||
Accumulated impairment losses | $ 522,184 | $ 500,417 |
Goodwill and Other Intangible_4
Goodwill and Other Intangibles - Schedule of Other Intangible Assets (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Indefinite-lived intangibles: | |||||
Beginning Balance | $ 93,900 | ||||
Acquisitions | 0 | ||||
Impairments | 0 | ||||
Other | (90,900) | ||||
Effect of Currency Translation | 0 | ||||
Ending Balance | $ 3,000 | 3,000 | |||
Finite-lived intangibles: | |||||
Beginning Balance | 6,308,250 | ||||
Acquisitions | 0 | ||||
Impairments | (65,771) | ||||
Other | (15,428) | ||||
Effect of Currency Translation | (6,633) | ||||
Ending Balance | 6,220,418 | 6,220,418 | |||
Total other intangibles | |||||
Beginning balance | 6,402,150 | ||||
Acquisitions | 0 | ||||
Impairments | (2,020) | $ (4,261) | (65,771) | $ (104,660) | |
Other | (106,328) | ||||
Effect of Currency Translation | (6,633) | ||||
Ending balance | 6,223,418 | 6,223,418 | |||
Accumulated amortization: | |||||
Beginning Balance | (3,830,883) | ||||
Amortization | (104,100) | $ (131,900) | (325,801) | $ (417,900) | |
Impairments | 0 | ||||
Other | 108,328 | ||||
Effect of Currency Translation | 3,800 | ||||
Ending Balance | (4,044,556) | (4,044,556) | |||
Net other intangibles | 2,178,862 | 2,178,862 | $ 2,571,267 | ||
Licensing | |||||
Finite-lived intangibles: | |||||
Beginning Balance | 457,402 | ||||
Acquisitions | 0 | ||||
Impairments | (8,700) | ||||
Other | 0 | ||||
Effect of Currency Translation | 0 | ||||
Ending Balance | 448,702 | 448,702 | |||
Accumulated amortization: | |||||
Beginning Balance | (410,336) | ||||
Amortization | (6,162) | ||||
Impairments | 0 | ||||
Other | 0 | ||||
Effect of Currency Translation | 0 | ||||
Ending Balance | (416,498) | (416,498) | |||
Tradenames | |||||
Finite-lived intangibles: | |||||
Beginning Balance | 6,409 | ||||
Acquisitions | 0 | ||||
Impairments | 0 | ||||
Other | 0 | ||||
Effect of Currency Translation | 0 | ||||
Ending Balance | 6,409 | 6,409 | |||
Accumulated amortization: | |||||
Beginning Balance | (6,409) | ||||
Amortization | 0 | ||||
Impairments | 0 | ||||
Other | 0 | ||||
Effect of Currency Translation | 0 | ||||
Ending Balance | (6,409) | (6,409) | |||
Developed technology | |||||
Finite-lived intangibles: | |||||
Beginning Balance | 5,844,439 | ||||
Acquisitions | 0 | ||||
Impairments | (57,071) | ||||
Other | (15,428) | ||||
Effect of Currency Translation | (6,633) | ||||
Ending Balance | 5,765,307 | 5,765,307 | |||
Accumulated amortization: | |||||
Beginning Balance | (3,414,138) | ||||
Amortization | (319,639) | ||||
Impairments | 0 | ||||
Other | 108,328 | ||||
Effect of Currency Translation | 3,800 | ||||
Ending Balance | (3,621,649) | (3,621,649) | |||
Finite-lived intangible assets, reclassification adjustment | 90,900 | ||||
In-process research and development | |||||
Indefinite-lived intangibles: | |||||
Beginning Balance | 93,900 | ||||
Acquisitions | 0 | ||||
Impairments | 0 | ||||
Other | (90,900) | ||||
Effect of Currency Translation | 0 | ||||
Ending Balance | $ 3,000 | 3,000 | |||
Accumulated amortization: | |||||
Finite-lived intangible assets, reclassification adjustment | $ (90,900) | ||||
Weighted average | |||||
Accumulated amortization: | |||||
Intangible life (years) | 11 years | ||||
Weighted average | Licensing | |||||
Accumulated amortization: | |||||
Intangible life (years) | 14 years | ||||
Weighted average | Developed technology | |||||
Accumulated amortization: | |||||
Intangible life (years) | 11 years |
Goodwill and Other Intangible_5
Goodwill and Other Intangibles - Other Intangibles (Narrative) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Amortization of intangible assets | $ 104,100 | $ 131,900 | $ 325,801 | $ 417,900 |
Goodwill and Other Intangible_6
Goodwill and Other Intangibles - Schedule of Estimated Amortization of Intangibles (Details) $ in Thousands | Sep. 30, 2020USD ($) |
Goodwill and Intangible Assets Disclosure [Abstract] | |
2020 | $ 428,828 |
2021 | 394,331 |
2022 | 379,640 |
2023 | 336,465 |
2024 | $ 298,198 |
Goodwill and Other Intangible_7
Goodwill and Other Intangibles - Schedule of Intangible Asset Impairment Charges Including Goodwill (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||||
Goodwill impairment charges | $ 0 | $ 0 | $ 32,786 | $ 151,108 |
Other intangible asset impairment charges | $ 2,020 | $ 4,261 | $ 65,771 | $ 104,660 |
Goodwill and Other Intangible_8
Goodwill and Other Intangibles - Impairments Narrative (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 9 Months Ended | ||||
Sep. 30, 2020USD ($) | Mar. 31, 2020USD ($) | Sep. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Jun. 30, 2019USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | |
Goodwill [Line Items] | |||||||
Goodwill impairment charges | $ 0 | $ 0 | $ 32,786 | $ 151,108 | |||
Generic Pharmaceuticals | |||||||
Goodwill [Line Items] | |||||||
Goodwill impairment charges | $ 32,800 | $ 86,000 | $ 65,100 | ||||
Generic Pharmaceuticals | Discount rate | |||||||
Goodwill [Line Items] | |||||||
Intangible assets and goodwill, measurement input | 0.095 | 0.105 | 0.105 |
Contract Assets and Liabiliti_3
Contract Assets and Liabilities - Contract Assets and Contract Liabilities from Contracts with Customers (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Dec. 31, 2019 | |
Contract with Customer, Contract Asset, Contract Liability, and Receivable [Abstract] | ||
Contract assets, net | $ 13,625 | $ 0 |
Contract assets, net - $ change | 13,625 | |
Contract liabilities, net | 7,725 | 6,592 |
Contract liabilities, net - $ change | $ 1,133 | |
Contract liabilities, net - % change | 17.00% | |
Contract with customer, asset, after allowance for credit loss, current | $ 2,600 | |
Contract liability amounts classified as current | 2,900 | $ 1,400 |
Increase in contract liability | $ 400 |
Contract Assets and Liabiliti_4
Contract Assets and Liabilities - Narrative (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Contract with Customer, Contract Asset, Contract Liability, and Receivable [Abstract] | |
Performance obligation satisfaction period | 7 days |
Performance obligation satisfied in previous period | $ 14 |
Accounts Payable and Accrued _3
Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Accounts Payable and Accrued Liabilities, Current [Abstract] | ||
Trade accounts payable | $ 104,621 | $ 101,532 |
Returns and allowances | 205,962 | 206,248 |
Rebates | 119,265 | 129,056 |
Chargebacks | 2,589 | 1,594 |
Accrued interest | 135,199 | 112,860 |
Accrued payroll and related benefits | 112,256 | 79,869 |
Accrued royalties and other distribution partner payables | 61,355 | 115,816 |
Acquisition-related contingent consideration—current | 9,665 | 6,534 |
Other | 117,492 | 146,440 |
Total | $ 868,404 | $ 899,949 |
Debt (Components of Total Indeb
Debt (Components of Total Indebtedness) (Details) - USD ($) | Sep. 30, 2020 | Aug. 31, 2020 | Jun. 30, 2020 | Dec. 31, 2019 | Mar. 31, 2019 |
Debt Instrument [Line Items] | |||||
Principal Amount | $ 8,384,981,000 | $ 8,470,678,000 | |||
Carrying Amount | 8,320,501,000 | 8,394,049,000 | $ 1,624,000,000 | ||
Less current portion, net | 34,150,000 | 34,150,000 | |||
Principal amount of total long-term debt, less current portion, net | 8,350,831,000 | 8,436,528,000 | |||
Carrying amount of total long-term debt, less current portion, net | 8,286,351,000 | 8,359,899,000 | |||
Fair value of long term debt | $ 8,100,000,000 | $ 7,400,000,000 | |||
Revolving Credit Facility | |||||
Debt Instrument [Line Items] | |||||
Effective Interest Rate | 2.69% | 4.25% | |||
Principal Amount | $ 300,000,000 | $ 300,000,000 | |||
Carrying Amount | $ 300,000,000 | $ 300,000,000 | |||
7.25% Senior Notes due 2022 | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 7.25% | 7.25% | |||
Effective Interest Rate | 7.25% | 7.25% | |||
Principal Amount | $ 8,294,000 | $ 8,294,000 | |||
Carrying Amount | $ 8,294,000 | $ 8,294,000 | |||
5.75% Senior Notes due 2022 | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 5.75% | 5.75% | 5.75% | ||
Effective Interest Rate | 5.75% | 5.75% | |||
Principal Amount | $ 172,048,000 | $ 10,000,000 | $ 182,479,000 | ||
Carrying Amount | $ 172,048,000 | $ 182,479,000 | |||
5.375% Senior Notes due 2023 | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 5.375% | 5.375% | |||
Effective Interest Rate | 5.62% | 5.62% | |||
Principal Amount | $ 6,127,000 | $ 210,440,000 | |||
Carrying Amount | $ 6,095,000 | $ 209,018,000 | |||
6.00% Senior Notes due 2023 | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 6.00% | 6.00% | |||
Effective Interest Rate | 6.28% | 6.28% | |||
Principal Amount | $ 56,436,000 | $ 1,439,840,000 | |||
Carrying Amount | $ 56,029,000 | $ 1,426,998,000 | |||
5.875% Senior Secured Notes due 2024 | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 5.875% | ||||
Effective Interest Rate | 6.14% | 6.14% | |||
Principal Amount | $ 300,000,000 | $ 300,000,000 | |||
Carrying Amount | $ 297,109,000 | $ 296,647,000 | |||
6.00% Senior Notes due 2025 | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 6.00% | 6.00% | |||
Effective Interest Rate | 6.27% | 6.27% | |||
Principal Amount | $ 21,578,000 | $ 1,200,000,000 | |||
Carrying Amount | $ 21,354,000 | $ 1,185,726,000 | |||
7.50% Senior Secured Notes due 2027 | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 7.50% | 7.50% | |||
Effective Interest Rate | 7.70% | 7.71% | |||
Principal Amount | $ 2,015,479,000 | $ 1,500,000,000 | $ 1,500,000,000 | ||
Carrying Amount | $ 1,994,514,000 | $ 1,482,212,000 | |||
9.50% Senior Secured Second Lien Notes due 2027 | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 9.50% | 9.50% | |||
Effective Interest Rate | 9.68% | ||||
Principal Amount | $ 940,590,000 | $ 940,600,000 | $ 0 | ||
Carrying Amount | $ 932,175,000 | $ 0 | |||
6.00% Senior Notes due 2028 | |||||
Debt Instrument [Line Items] | |||||
Interest rate | 6.00% | 6.00% | |||
Effective Interest Rate | 6.11% | ||||
Principal Amount | $ 1,260,416,000 | $ 1,260,400,000 | $ 0 | ||
Carrying Amount | $ 1,251,498,000 | $ 0 | |||
Term Loan Facility | |||||
Debt Instrument [Line Items] | |||||
Effective Interest Rate | 5.21% | 6.21% | |||
Principal Amount | $ 3,304,013,000 | $ 3,329,625,000 | |||
Carrying Amount | $ 3,281,385,000 | $ 3,302,675,000 |
Debt (Credit Facility) (Narrati
Debt (Credit Facility) (Narrative) (Details) - USD ($) | Sep. 30, 2020 | Dec. 31, 2019 |
Line of Credit Facility [Line Items] | ||
Principal amount | $ 8,384,981,000 | $ 8,470,678,000 |
Revolving Credit Facility | ||
Line of Credit Facility [Line Items] | ||
Principal amount | 300,000,000 | $ 300,000,000 |
Credit facility, remaining borrowing capacity | 696,200,000 | |
2017 credit agreement | Revolving Credit Facility | ||
Line of Credit Facility [Line Items] | ||
Principal amount | 1,000,000,000 | |
Term Loan Facility | 2017 credit agreement | ||
Line of Credit Facility [Line Items] | ||
Principal amount | $ 3,415,000,000 |
Debt (Senior Notes and Senior S
Debt (Senior Notes and Senior Secured Notes) (Details) | 1 Months Ended | 9 Months Ended | |
Jun. 30, 2020 | Sep. 30, 2020 | Mar. 31, 2019 | |
Non-Call Period | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 100.00% | ||
After Non-call Period | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 100.00% | ||
After Non-call Period | Minimum | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 100.00% | ||
After Non-call Period | Maximum | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 107.125% | ||
As of June 30, 2020 | Minimum | |||
Debt Instrument, Redemption [Line Items] | |||
Percentage of principal that may be redeemed | 35.00% | ||
As of June 30, 2020 | Maximum | |||
Debt Instrument, Redemption [Line Items] | |||
Percentage of principal that may be redeemed | 40.00% | ||
7.50% Senior Secured Notes due 2027 | |||
Debt Instrument, Redemption [Line Items] | |||
Interest rate | 7.50% | 7.50% | |
7.50% Senior Secured Notes due 2027 | Non-Call Period | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 100.00% | ||
Interest rate | 7.50% | ||
7.50% Senior Secured Notes due 2027 | Non-Call Period | Maximum | |||
Debt Instrument, Redemption [Line Items] | |||
Percentage of principal that may be redeemed | 35.00% | ||
7.50% Senior Secured Notes due 2027 | After Non-call Period | |||
Debt Instrument, Redemption [Line Items] | |||
Interest rate | 7.50% | ||
7.50% Senior Secured Notes due 2027 | After Non-call Period | Minimum | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 100.00% | ||
7.50% Senior Secured Notes due 2027 | After Non-call Period | Maximum | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 105.625% | ||
7.50% Senior Secured Notes due 2027 | As of June 30, 2020 | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 107.50% | ||
9.50% Senior Secured Second Lien Notes due 2027 | |||
Debt Instrument, Redemption [Line Items] | |||
Interest rate | 9.50% | 9.50% | |
9.50% Senior Secured Second Lien Notes due 2027 | Non-Call Period | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 100.00% | ||
Interest rate | 9.50% | ||
9.50% Senior Secured Second Lien Notes due 2027 | Non-Call Period | Maximum | |||
Debt Instrument, Redemption [Line Items] | |||
Percentage of principal that may be redeemed | 40.00% | ||
9.50% Senior Secured Second Lien Notes due 2027 | After Non-call Period | |||
Debt Instrument, Redemption [Line Items] | |||
Interest rate | 9.50% | ||
9.50% Senior Secured Second Lien Notes due 2027 | After Non-call Period | Minimum | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 100.00% | ||
9.50% Senior Secured Second Lien Notes due 2027 | After Non-call Period | Maximum | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 107.125% | ||
9.50% Senior Secured Second Lien Notes due 2027 | As of June 30, 2020 | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 109.50% | ||
6.00% Senior Notes due 2028 | |||
Debt Instrument, Redemption [Line Items] | |||
Interest rate | 6.00% | 6.00% | |
6.00% Senior Notes due 2028 | Non-Call Period | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 100.00% | ||
Interest rate | 6.00% | ||
Percentage of principal that may be redeemed | 106.00% | ||
6.00% Senior Notes due 2028 | Non-Call Period | Maximum | |||
Debt Instrument, Redemption [Line Items] | |||
Percentage of principal that may be redeemed | 40.00% | ||
6.00% Senior Notes due 2028 | After Non-call Period | |||
Debt Instrument, Redemption [Line Items] | |||
Interest rate | 6.00% | ||
6.00% Senior Notes due 2028 | After Non-call Period | Minimum | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 100.00% | ||
6.00% Senior Notes due 2028 | After Non-call Period | Maximum | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 104.50% | ||
6.00% Senior Notes due 2028 | As of June 30, 2020 | |||
Debt Instrument, Redemption [Line Items] | |||
Redemption price (as percent) | 106.00% |
Debt (Debt Refinancing Transact
Debt (Debt Refinancing Transactions) (Narrative) (Details) - USD ($) | 1 Months Ended | 9 Months Ended | ||||
Jun. 30, 2020 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Aug. 31, 2020 | Dec. 31, 2019 | |
Debt Instrument [Line Items] | ||||||
Principal amount | $ 8,384,981,000 | $ 8,470,678,000 | ||||
Repurchased face amount | $ 1,642,200,000 | |||||
Aggregate carrying amount | 1,624,000,000 | $ 8,320,501,000 | 8,394,049,000 | |||
Repayments of debt | 1,500,000,000 | |||||
Gain on extinguishment of debt | 124,000,000 | |||||
Repayments of senior debt | $ 47,200,000 | |||||
Unamortized discount (premium) and debt issuance costs, net | $ 31,100,000 | 26,200,000 | ||||
Redemption period one | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price (as percent) | 100.00% | |||||
Redemption period two | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price (as percent) | 100.00% | |||||
Redemption period two | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price (as percent) | 107.125% | |||||
Redemption period two | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price (as percent) | 100.00% | |||||
7.50% Senior Secured Notes due 2027 | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | $ 1,500,000,000 | $ 2,015,479,000 | 1,500,000,000 | |||
Interest rate | 7.50% | 7.50% | ||||
Aggregate carrying amount | $ 1,994,514,000 | 1,482,212,000 | ||||
Unamortized discount (premium) and debt issuance costs, net | $ 19,100,000 | |||||
7.50% Senior Secured Notes due 2027 | Redemption period one | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 7.50% | |||||
Redemption price (as percent) | 100.00% | |||||
Redemption of cash proceeds as a percent of principal | 107.50% | |||||
7.50% Senior Secured Notes due 2027 | Redemption period one | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Percentage of principal that may be redeemed | 35.00% | |||||
7.50% Senior Secured Notes due 2027 | Redemption period two | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 7.50% | |||||
7.50% Senior Secured Notes due 2027 | Redemption period two | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price (as percent) | 105.625% | |||||
7.50% Senior Secured Notes due 2027 | Redemption period two | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price (as percent) | 100.00% | |||||
7.25% Senior Notes due 2022 | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | $ 8,294,000 | 8,294,000 | ||||
Interest rate | 7.25% | 7.25% | ||||
Aggregate carrying amount | $ 8,294,000 | 8,294,000 | ||||
5.75% Senior Notes due 2022 | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | $ 172,048,000 | $ 10,000,000 | 182,479,000 | |||
Interest rate | 5.75% | 5.75% | 5.75% | |||
Aggregate carrying amount | $ 172,048,000 | 182,479,000 | ||||
5.375% Senior Notes due 2023 | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | $ 6,127,000 | 210,440,000 | ||||
Interest rate | 5.375% | 5.375% | ||||
Aggregate carrying amount | $ 6,095,000 | 209,018,000 | ||||
Extinguishment of debt, amount | $ 204,300,000 | |||||
6.00% Senior Notes due 2023 | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | $ 56,436,000 | 1,439,840,000 | ||||
Interest rate | 6.00% | 6.00% | ||||
Aggregate carrying amount | $ 56,029,000 | 1,426,998,000 | ||||
Extinguishment of debt, amount | $ 1,383,400,000 | |||||
6.00% Senior Notes due 2025 | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | $ 21,578,000 | 1,200,000,000 | ||||
Interest rate | 6.00% | 6.00% | ||||
Aggregate carrying amount | $ 21,354,000 | 1,185,726,000 | ||||
Extinguishment of debt, amount | $ 1,178,400,000 | |||||
Additional 7.5% Senior Secured Notes Due 2027 | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | $ 515,500,000 | |||||
Interest rate | 7.50% | |||||
9.50% Senior Secured Second Lien Notes due 2027 | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | $ 940,600,000 | $ 940,590,000 | 0 | |||
Interest rate | 9.50% | 9.50% | ||||
Aggregate carrying amount | $ 932,175,000 | 0 | ||||
9.50% Senior Secured Second Lien Notes due 2027 | Redemption period one | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 9.50% | |||||
Redemption price (as percent) | 100.00% | |||||
Redemption of cash proceeds as a percent of principal | 109.50% | |||||
9.50% Senior Secured Second Lien Notes due 2027 | Redemption period one | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Percentage of principal that may be redeemed | 40.00% | |||||
9.50% Senior Secured Second Lien Notes due 2027 | Redemption period two | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 9.50% | |||||
9.50% Senior Secured Second Lien Notes due 2027 | Redemption period two | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price (as percent) | 107.125% | |||||
9.50% Senior Secured Second Lien Notes due 2027 | Redemption period two | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price (as percent) | 100.00% | |||||
6.00% Senior Notes due 2028 | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | $ 1,260,400,000 | $ 1,260,416,000 | 0 | |||
Interest rate | 6.00% | 6.00% | ||||
Aggregate carrying amount | $ 1,251,498,000 | 0 | ||||
6.00% Senior Notes due 2028 | Redemption period one | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 6.00% | |||||
Redemption price (as percent) | 100.00% | |||||
Percentage of principal that may be redeemed | 106.00% | |||||
6.00% Senior Notes due 2028 | Redemption period one | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Percentage of principal that may be redeemed | 40.00% | |||||
6.00% Senior Notes due 2028 | Redemption period two | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate | 6.00% | |||||
6.00% Senior Notes due 2028 | Redemption period two | Maximum | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price (as percent) | 104.50% | |||||
6.00% Senior Notes due 2028 | Redemption period two | Minimum | ||||||
Debt Instrument [Line Items] | ||||||
Redemption price (as percent) | 100.00% | |||||
Senior notes | Note repurchases | ||||||
Debt Instrument [Line Items] | ||||||
Unamortized discount (premium) and debt issuance costs, net | $ 4,200,000 | |||||
Revolving Credit Facility | ||||||
Debt Instrument [Line Items] | ||||||
Principal amount | $ 300,000,000 | 300,000,000 | ||||
Aggregate carrying amount | $ 300,000,000 | $ 300,000,000 | ||||
Proceeds from long-term lines of credit | $ 300,000,000 | |||||
Unamortized discount (premium) and debt issuance costs, net | $ 2,900,000 |
Debt (Maturities of Long-Term D
Debt (Maturities of Long-Term Debt) (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Maturities | |
2020 | $ 34,150 |
2021 | 34,150 |
2022 | 237,292 |
2023 | 96,713 |
2024 | $ 3,770,225 |
Senior notes | Senior notes maturing due 2022 | |
Maturities | |
Long-term debt, maturity repayment deadline | 91 days |
Revolving Credit Facility | |
Maturities | |
2022 | $ 22,800 |
Commitments and Contingencies_2
Commitments and Contingencies (Narrative) (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
Jan. 31, 2020USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Sep. 30, 2018USD ($) | May 31, 2018 | Mar. 31, 2019USD ($) | Sep. 30, 2020USD ($)caseclass_action | Dec. 31, 2018USD ($) | Oct. 30, 2020case | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($) | |
Loss Contingencies [Line Items] | |||||||||||
Reserve for loss contingencies | $ 374,800 | ||||||||||
Vaginal mesh cases | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Payments to plaintiffs and qualified settlement funds | 3,600,000 | ||||||||||
Settlement funds | $ 136,343 | $ 242,842 | |||||||||
Opioid-related matters | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Number of putative class actions | class_action | 3 | ||||||||||
Number of cases set for trial | case | 2 | ||||||||||
Settlement, amount awarded to other party | $ 8,750 | $ 10,000 | |||||||||
Opioid-related matters | Subsequent event | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Number of cases filed by states | case | 20 | ||||||||||
Pending claims, number | case | 2,870 | ||||||||||
Number of cases filed by hospitals, health systems, unions, welfare funds or other third-party | case | 295 | ||||||||||
Number of cases alleging personal injury and/or wrongful death | case | 175 | ||||||||||
TESTOPEL® | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Reserve for loss contingencies | $ 10,000 | ||||||||||
Payments to plaintiffs and qualified settlement funds | $ 30,000 | $ 60,000 | |||||||||
Settlement, amount awarded to other party | $ 100,000 | ||||||||||
Public Employees' Retirement System of Mississippi vs. Endo International PLC | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Settlement, amount awarded to other party | $ 50,000 | ||||||||||
Loss contingency accrual, period increase (decrease) | 50,000 | ||||||||||
Loss contingency, receivable | $ 50,000 | ||||||||||
American Medical Systems | Vaginal mesh cases | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Loss contingency, claims settled, number | case | 71,000 | ||||||||||
Par Pharmaceutical, Inc. | VASOSTRICT Related Matters | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Lawsuit filing period | 45 days | ||||||||||
Stay of approval period, Hatch-Waxman Act | 30 months | ||||||||||
VASOSTRICT and/or ADRENALIN | Opioid-related matters | |||||||||||
Loss Contingencies [Line Items] | |||||||||||
Settlement, amount awarded to other party | $ 1,000 |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Loss Contingencies (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Mesh Liability Accrual | |
Ending balance | $ 374,800 |
Vaginal mesh cases | |
Qualified Settlement Funds | |
Beginning balance | 242,842 |
Cash distributions to settle disputes from Qualified Settlement Funds | (107,225) |
Other | 726 |
Ending balance | 136,343 |
Mesh Liability Accrual | |
Other | 726 |
Vaginal mesh cases | Mesh product liability accrual | |
Qualified Settlement Funds | |
Additional charges | 30,454 |
Other | 616 |
Mesh Liability Accrual | |
Beginning balance | 454,031 |
Cash distributions to settle disputes from Qualified Settlement Funds | (107,225) |
Cash distributions to settle disputes | (26,559) |
Other | 616 |
Ending balance | $ 351,317 |
Other Comprehensive Income (L_2
Other Comprehensive Income (Loss) - Narrative (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Equity [Abstract] | ||||
Other comprehensive income (loss), tax, portion attributable to parent | $ 0 | $ 0 | $ 0 | $ 0 |
Reclassification from AOCI | $ 0 | $ 0 | $ 0 | $ 0 |
Shareholders' Deficit (Details)
Shareholders' Deficit (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shareholders' equity, beginning balance | $ (714,867) | $ (737,817) | $ (866,544) | $ (590,472) | $ (494,450) | $ (498,283) | $ (866,544) | $ (498,283) |
Net income (loss) | (75,887) | 10,558 | 129,930 | (79,415) | (106,005) | (18,573) | 64,601 | (203,993) |
Other comprehensive income (loss) | 2,755 | 5,624 | (14,437) | (2,515) | 4,395 | 4,730 | (6,058) | 6,610 |
Compensation related to share-based awards | 6,585 | 9,222 | 17,645 | 11,576 | 12,600 | 24,733 | ||
Exercise of options | (650) | (7,013) | 4 | |||||
Tax withholding for restricted shares | (1,070) | (2,467) | (4,398) | (2,414) | ||||
Other | 2 | 13 | (13) | (1) | 1 | (1) | ||
Shareholders' equity, ending balance | (782,482) | (714,867) | (737,817) | (661,477) | (590,472) | $ (494,450) | (782,482) | $ (661,477) |
Accounting Standards Update [Extensible List] | us-gaap:AccountingStandardsUpdate201602Member | us-gaap:AccountingStandardsUpdate201602Member | ||||||
Cumulative Effect, Period of Adoption, Adjustment | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shareholders' equity, beginning balance | $ (4,646) | $ (4,646) | ||||||
Cumulative Effect, Period of Adoption, Adjusted Balance | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shareholders' equity, beginning balance | (502,929) | (502,929) | ||||||
Euro Deferred Shares | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shareholders' equity, beginning balance | 45 | 44 | 45 | 45 | 45 | 46 | 45 | 46 |
Other | 2 | 1 | (1) | (1) | (1) | |||
Shareholders' equity, ending balance | 47 | 45 | 44 | 44 | 45 | 45 | 47 | 44 |
Euro Deferred Shares | Cumulative Effect, Period of Adoption, Adjusted Balance | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shareholders' equity, beginning balance | 46 | 46 | ||||||
Ordinary Shares | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shareholders' equity, beginning balance | 23 | 23 | 23 | 23 | 22 | 22 | 23 | 22 |
Other | 0 | 1 | ||||||
Shareholders' equity, ending balance | 23 | 23 | 23 | 23 | 23 | 22 | 23 | 23 |
Ordinary Shares | Cumulative Effect, Period of Adoption, Adjusted Balance | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shareholders' equity, beginning balance | 22 | 22 | ||||||
Additional Paid-in Capital | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shareholders' equity, beginning balance | 8,924,694 | 8,917,927 | 8,904,692 | 8,883,720 | 8,878,133 | 8,855,810 | 8,904,692 | 8,855,810 |
Compensation related to share-based awards | 6,585 | 9,222 | 17,645 | 11,576 | 12,600 | 24,733 | 33,500 | 48,900 |
Exercise of options | (650) | (7,013) | 4 | |||||
Tax withholding for restricted shares | (1,070) | (2,467) | (4,398) | (2,414) | ||||
Other | 12 | (12) | ||||||
Shareholders' equity, ending balance | 8,930,209 | 8,924,694 | 8,917,927 | 8,894,646 | 8,883,720 | 8,878,133 | 8,930,209 | 8,894,646 |
Additional Paid-in Capital | Cumulative Effect, Period of Adoption, Adjusted Balance | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shareholders' equity, beginning balance | 8,855,810 | 8,855,810 | ||||||
Accumulated Deficit | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shareholders' equity, beginning balance | (9,411,726) | (9,422,284) | (9,552,214) | (9,254,156) | (9,148,151) | (9,124,932) | (9,552,214) | (9,124,932) |
Net income (loss) | (75,887) | 10,558 | 129,930 | (79,415) | (106,005) | (18,573) | ||
Shareholders' equity, ending balance | (9,487,613) | (9,411,726) | (9,422,284) | (9,333,571) | (9,254,156) | (9,148,151) | (9,487,613) | (9,333,571) |
Accumulated Deficit | Cumulative Effect, Period of Adoption, Adjustment | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shareholders' equity, beginning balance | (4,646) | (4,646) | ||||||
Accumulated Deficit | Cumulative Effect, Period of Adoption, Adjusted Balance | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shareholders' equity, beginning balance | (9,129,578) | (9,129,578) | ||||||
Accumulated Other Comprehensive Loss | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shareholders' equity, beginning balance | (227,903) | (233,527) | (219,090) | (220,104) | (224,499) | (229,229) | (219,090) | (229,229) |
Other comprehensive income (loss) | 2,755 | 5,624 | (14,437) | (2,515) | 4,395 | 4,730 | ||
Shareholders' equity, ending balance | $ (225,148) | $ (227,903) | $ (233,527) | $ (222,619) | $ (220,104) | (224,499) | $ (225,148) | (222,619) |
Accumulated Other Comprehensive Loss | Cumulative Effect, Period of Adoption, Adjusted Balance | ||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Shareholders' equity, beginning balance | $ (229,229) | $ (229,229) |
Shareholders' Deficit - Narrati
Shareholders' Deficit - Narrative (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Compensation related to share-based awards | $ 6,585 | $ 9,222 | $ 17,645 | $ 11,576 | $ 12,600 | $ 24,733 | ||
Unrecognized compensation cost | 30,700 | $ 30,700 | ||||||
Additional Paid-in Capital | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Compensation related to share-based awards | $ 6,585 | $ 9,222 | $ 17,645 | $ 11,576 | $ 12,600 | $ 24,733 | $ 33,500 | $ 48,900 |
Nonvested Stock Options | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Service period | 4 months 24 days | |||||||
Nonvested Restricted Stock | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Service period | 1 year 6 months |
Other (Income) Expense, Net (De
Other (Income) Expense, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Component of Operating Income [Abstract] | ||||
Net gain on sale of business and other assets | $ (1,888) | $ (1,933) | $ (16,730) | $ (3,101) |
Foreign currency loss (gain), net | 1,332 | 579 | (1,491) | 4,336 |
Net (gain) loss from our investments in the equity of other companies | (2,609) | 191 | (2,373) | 2,546 |
Other miscellaneous, net | (4,029) | 17,366 | (4,724) | 16,627 |
Other (income) expense, net | $ (7,194) | 16,203 | $ (25,318) | 20,408 |
Contract termination | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges | $ 17,500 | $ 17,500 |
Income Taxes (Loss from Continu
Income Taxes (Loss from Continuing Operations and Effective Tax Rate) (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2016 | |
Income Tax Disclosure [Abstract] | |||||
Loss from continuing operations before income tax | $ (64,800) | $ (24,070) | $ (18,299) | $ (120,363) | |
Income tax expense (benefit) | $ 4,174 | $ 17,361 | $ (124,516) | $ 31,732 | |
Effective tax rate | (6.40%) | (72.10%) | 680.50% | (26.40%) | |
Federal income tax expense (benefit), continuing operations | $ 129,000 | ||||
Proceeds from income tax refunds | $ 760,000 |
Net (Loss) Income Per Share - (
Net (Loss) Income Per Share - (Reconciliation Of The Numerator And Denominator Of Basic And Diluted Net Loss Per Share) (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Numerator: | ||||||||
Loss from continuing operations | $ (68,974) | $ (41,431) | $ 106,217 | $ (152,095) | ||||
Loss from discontinued operations, net of tax | (6,913) | (37,984) | (41,616) | (51,898) | ||||
NET (LOSS) INCOME | $ (75,887) | $ 10,558 | $ 129,930 | $ (79,415) | $ (106,005) | $ (18,573) | $ 64,601 | $ (203,993) |
Denominator: | ||||||||
For basic per share data—weighted average shares (in shares) | 230,040 | 226,598 | 228,985 | 225,804 | ||||
Dilutive effect of ordinary share equivalents (in shares) | 0 | 0 | 4,394 | 0 | ||||
For diluted per share data—weighted average shares (in shares) | 230,040 | 226,598 | 233,379 | 225,804 | ||||
Stock Options | ||||||||
Denominator: | ||||||||
Antidilutive securities excluded from computation of earnings per share (in shares) | 7,100 | |||||||
Stock Award | ||||||||
Denominator: | ||||||||
Antidilutive securities excluded from computation of earnings per share (in shares) | 6,400 |
Subsequent Events (Details)
Subsequent Events (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | |
Dec. 31, 2020 | Oct. 28, 2020 | |
Subsequent event | Marital Trust U/W/O Edwin H. Wegman | BioSpecifics Technologies Corp. | ||
Subsequent Event [Line Items] | ||
Noncontrolling interest, shares owned by noncontrolling owners (in shares) | 935,073 | |
Subsequent event | Marital Trust U/W/O Edwin H. Wegman | BioSpecifics Technologies Corp. | BioSpecifics Technologies Corp. | ||
Subsequent Event [Line Items] | ||
Noncontrolling interest, ownership percentage by noncontrolling owners | 12.70% | |
Subsequent event | BioSpecifics Technologies Corp. | ||
Subsequent Event [Line Items] | ||
Shares, outstanding (in shares) | 7,344,955 | |
BioSpecifics Technologies Corp. | Forecast | ||
Subsequent Event [Line Items] | ||
Price per share of BioSpecifics Technologies Corp acquired (in dollars per share) | $ 88.50 | |
Payments to acquire businesses, net of cash acquired | $ 540 | |
Cash acquired from acquisition | $ 120 |