Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2018 | Aug. 02, 2018 | |
Document and Entity Information | ||
Entity Registrant Name | Bausch Health Companies Inc. | |
Entity Central Index Key | 885,590 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Entity Common Stock, Shares Outstanding | 349,611,591 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Jun. 30, 2018 | Dec. 31, 2017 |
Current assets: | ||
Cash and cash equivalents | $ 838 | $ 720 |
Restricted cash | 0 | 77 |
Trade receivables, net | 1,973 | 2,130 |
Inventories, net | 993 | 1,048 |
Prepaid expenses and other current assets | 835 | 771 |
Total current assets | 4,639 | 4,746 |
Property, plant and equipment, net | 1,355 | 1,403 |
Intangible assets, net | 13,393 | 15,211 |
Goodwill | 13,283 | 15,593 |
Deferred tax assets, net | 1,654 | 433 |
Other non-current assets | 124 | 111 |
Total assets | 34,448 | 37,497 |
Current liabilities: | ||
Accounts payable | 417 | 365 |
Accrued and other current liabilities | 3,427 | 3,694 |
Current portion of long-term debt and other | 230 | 209 |
Total current liabilities | 4,074 | 4,268 |
Acquisition-related contingent consideration | 310 | 344 |
Non-current portion of long-term debt | 24,858 | 25,235 |
Deferred tax liabilities, net | 1,130 | 1,180 |
Other non-current liabilities | 518 | 526 |
Total liabilities | 30,890 | 31,553 |
Commitments and contingencies | ||
Equity | ||
Common shares, no par value, unlimited shares authorized, 349,600,960 and 348,708,567 issued and outstanding at June 30, 2018 and December 31, 2017, respectively | 10,114 | 10,090 |
Additional paid-in capital | 391 | 380 |
Accumulated deficit | (4,970) | (2,725) |
Accumulated other comprehensive loss | (2,068) | (1,896) |
Total Bausch Health Companies Inc. shareholders’ equity | 3,467 | 5,849 |
Noncontrolling interest | 91 | 95 |
Total equity | 3,558 | 5,944 |
Total liabilities and equity | $ 34,448 | $ 37,497 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2018 | Dec. 31, 2017 |
Statement of Financial Position [Abstract] | ||
Common stock, no par value (in usd per share) | $ 0 | $ 0 |
Common stock, shares issued (in shares) | 349,600,960 | 348,708,567 |
Common stock, shares outstanding (in shares) | 349,600,960 | 348,708,567 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenues | ||||
Revenues | $ 2,128 | $ 2,233 | $ 4,123 | $ 4,342 |
Expenses | ||||
Cost of goods sold (excluding amortization and impairments of intangible assets) | 584 | 635 | 1,144 | 1,219 |
Cost of other revenues | 10 | 11 | 23 | 23 |
Selling, general and administrative | 642 | 659 | 1,233 | 1,320 |
Research and development | 94 | 94 | 186 | 190 |
Amortization of intangible assets | 741 | 623 | 1,484 | 1,258 |
Goodwill impairments | 0 | 0 | 2,213 | 0 |
Asset impairments | 301 | 85 | 345 | 223 |
Restructuring and integration costs | 7 | 18 | 13 | 36 |
Acquired in-process research and development costs | 0 | 1 | 1 | 5 |
Acquisition-related contingent consideration | (6) | (49) | (4) | (59) |
Other expense (income), net | 0 | (19) | 11 | (259) |
Total expenses | 2,373 | 2,058 | 6,649 | 3,956 |
Operating (loss) income | (245) | 175 | (2,526) | 386 |
Interest income | 3 | 3 | 6 | 6 |
Interest expense | (435) | (459) | (851) | (933) |
Loss on extinguishment of debt | (48) | 0 | (75) | (64) |
Foreign exchange and other | (9) | 39 | 18 | 68 |
Loss before (provision for) benefit from income taxes | (734) | (242) | (3,428) | (537) |
(Provision for) benefit from income taxes | (138) | 205 | (23) | 1,129 |
Net (loss) income | (872) | (37) | (3,451) | 592 |
Net income attributable to noncontrolling interest | (1) | (1) | (3) | (2) |
Net (loss) income attributable to Bausch Health Companies Inc. | $ (873) | $ (38) | $ (3,454) | $ 590 |
(Loss) earnings per share attributable to Bausch Health Companies Inc.: | ||||
Basic (in usd per share) | $ (2.49) | $ (0.11) | $ (9.84) | $ 1.69 |
Diluted (in usd per share) | $ (2.49) | $ (0.11) | $ (9.84) | $ 1.68 |
Weighted-average common shares | ||||
Basic (in shares) | 351.3 | 350.1 | 351 | 350 |
Diluted (in shares) | 351.3 | 350.1 | 351 | 350.9 |
Product sales | ||||
Revenues | ||||
Revenues | $ 2,100 | $ 2,200 | $ 4,065 | $ 4,276 |
Other revenues | ||||
Revenues | ||||
Revenues | $ 28 | $ 33 | $ 58 | $ 66 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE (LOSS) INCOME - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Net (loss) income | $ (872) | $ (37) | $ (3,451) | $ 592 |
Other comprehensive (loss) income | ||||
Foreign currency translation adjustment | (218) | 56 | (172) | 146 |
Pension and postretirement benefit plan adjustments, net of income taxes | (1) | 0 | (1) | (1) |
Other comprehensive (loss) income | (219) | 56 | (173) | 145 |
Comprehensive (loss) income | (1,091) | 19 | (3,624) | 737 |
Comprehensive loss (income) attributable to noncontrolling interest | 2 | 1 | (2) | 2 |
Comprehensive (loss) income attributable to Bausch Health Companies Inc. | $ (1,089) | $ 20 | $ (3,626) | $ 739 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||||
Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | |
Cash Flows From Operating Activities | ||||||||||
Net (loss) income | $ (872) | $ (2,579) | $ (37) | $ (3,451) | $ 592 | |||||
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||||||||||
Depreciation and amortization of intangible assets | 1,570 | 1,341 | ||||||||
Amortization and write-off of debt discounts and debt issuance costs | 44 | 66 | ||||||||
Asset impairments | 301 | 85 | 345 | 223 | ||||||
Gain on disposals of assets and businesses, net | 0 | (367) | ||||||||
Acquisition-related contingent consideration | (4) | (59) | ||||||||
Allowances for losses on trade receivable and inventories | 33 | 48 | ||||||||
Deferred income taxes | (42) | (1,207) | ||||||||
Additions to accrued legal settlements | (1) | 33 | 10 | 109 | ||||||
Insurance proceeds for legal settlement | 0 | 20 | ||||||||
Payments of accrued legal settlements | (220) | (213) | ||||||||
Goodwill impairments | 0 | 2,213 | $ 312 | 0 | 2,213 | 0 | $ 312 | |||
Share-based compensation | 43 | 51 | ||||||||
Foreign exchange gain | (15) | (70) | ||||||||
Loss on extinguishment of debt | 48 | 0 | 75 | 64 | ||||||
Payment of contingent consideration adjustments, including accretion | (2) | (2) | ||||||||
Other | (2) | (2) | ||||||||
Changes in operating assets and liabilities: | ||||||||||
Trade receivables | 128 | 452 | ||||||||
Inventories | (12) | 0 | ||||||||
Prepaid expenses and other current assets | (76) | 20 | ||||||||
Accounts payable, accrued and other liabilities | 23 | 156 | ||||||||
Net cash provided by operating activities | 660 | 1,222 | ||||||||
Cash Flows From Investing Activities | ||||||||||
Acquisition of businesses, net of cash acquired | 5 | 0 | ||||||||
Acquisition of intangible assets and other assets | (75) | (141) | ||||||||
Purchases of property, plant and equipment | (63) | (75) | ||||||||
Purchases of marketable securities | (4) | (1) | ||||||||
Proceeds from sale of marketable securities | 4 | 1 | ||||||||
Proceeds from sale of assets and businesses, net of costs to sell | (6) | 2,144 | ||||||||
Net cash (used in) provided by investing activities | (139) | 1,928 | ||||||||
Cash Flows From Financing Activities | ||||||||||
Issuance of long-term debt, net of discount | 7,474 | 6,232 | ||||||||
Repayments of long-term debt | (7,836) | (7,839) | ||||||||
Repayments of short-term debt | (1) | (7) | ||||||||
Payment of employee withholding tax upon vesting of share-based awards | (8) | (3) | ||||||||
Payments of contingent consideration | (18) | (25) | ||||||||
Payments of deferred consideration | (18) | 0 | ||||||||
Payments of financing costs | (59) | (39) | ||||||||
Other | 1 | (10) | ||||||||
Net cash used in financing activities | (465) | (1,691) | ||||||||
Effect of exchange rate changes on cash and cash equivalents | (15) | 24 | ||||||||
Net increase in cash and cash equivalents and restricted cash | 41 | 1,483 | ||||||||
Cash and cash equivalents and restricted cash, beginning of period | 797 | 2,025 | 797 | 542 | 542 | |||||
Cash and cash equivalents and restricted cash, end of period | 838 | 2,025 | 838 | 2,025 | 797 | |||||
Cash and cash equivalents | $ 838 | $ 720 | $ 1,214 | |||||||
Restricted cash | 0 | 77 | 811 | |||||||
Cash and cash equivalents and restricted cash, end of period | $ 838 | $ 797 | $ 2,025 | $ 2,025 | $ 797 | $ 542 | $ 542 | $ 838 | $ 797 | $ 2,025 |
DESCRIPTION OF BUSINESS
DESCRIPTION OF BUSINESS | 6 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
DESCRIPTION OF BUSINESS | DESCRIPTION OF BUSINESS Bausch Health Companies Inc. (the “Company”), formerly known as Valeant Pharmaceuticals International, Inc., is a multinational, specialty pharmaceutical and medical device company that develops, manufactures, and markets a broad range of branded, generic and branded generic pharmaceuticals, over-the-counter (“OTC”) products, and medical devices (contact lenses, intraocular lenses, ophthalmic surgical equipment, and aesthetics devices) which are marketed directly or indirectly in over 90 countries. |
SIGNIFICANT ACCOUNTING POLICIES
SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
SIGNIFICANT ACCOUNTING POLICIES | SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Use of Estimates The accompanying unaudited consolidated financial statements have been prepared by the Company in United States (“U.S.”) dollars and in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial reporting, which do not conform in all respects to the requirements of U.S. GAAP for annual financial statements. Accordingly, these notes to the unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements prepared in accordance with U.S. GAAP that are contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 , filed with the U.S. Securities and Exchange Commission (the “SEC”) and the Canadian Securities Administrators. The unaudited consolidated financial statements have been prepared using accounting policies that are consistent with the policies used in preparing the Company’s audited consolidated financial statements for the year ended December 31, 2017 , except for the new accounting guidance adopted during the period. The unaudited consolidated financial statements reflect all normal and recurring adjustments necessary for a fair presentation of the Company’s financial position and results of operations for the interim periods. The operating results for the interim periods presented are not necessarily indicative of the results expected for the full year. In preparing the unaudited consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the unaudited consolidated financial statements, and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates. On an ongoing basis, management reviews its estimates to ensure that these estimates appropriately reflect changes in the Company’s business and new information as it becomes available. If historical experience and other factors used by management to make these estimates do not reasonably reflect future activity, the Company’s results of operations and financial position could be materially impacted. Principles of Consolidation The unaudited consolidated financial statements include the accounts of the Company and those of its subsidiaries and any variable interest entities for which the Company is the primary beneficiary. All intercompany transactions and balances have been eliminated. Revisions to the Three Months Ended March 31, 2018 The Company identified an understatement of the Benefit from income taxes for the three months ended March 31, 2018 of $112 million , or $0.32 per basic and diluted share, due to an error in the forecasted effective tax rate. The Company also identified an understatement of the foreign currency translation adjustment as presented in the consolidated statement of comprehensive loss for the three months ended March 31, 2018 which did not impact the net loss or loss per share reported for the same period. Based on its evaluation, the Company concluded that these misstatements were not material to its financial position and statements of operations, comprehensive loss and cash flows as of and for the three months ended March 31, 2018 or the related disclosures. The March 31, 2018 financial information will be revised in future filings to correct these misstatements. There was no impact to the June 30, 2018 reported amounts. The following table presents the effect of the revisions on the Company’s consolidated balance sheet as of March 31, 2018: (in millions) As Previously Reported Adjustment As Revised Deferred tax liabilities, net $ 1,139 $ (112 ) $ 1,027 Total liabilities 31,275 (112 ) 31,163 Accumulated deficit (4,209 ) 112 (4,097 ) Total Bausch Health Companies Inc. shareholders' equity 4,424 112 4,536 Total equity 4,523 112 4,635 The following table presents the effect of the revisions on the Company’s consolidated statements of operations and comprehensive loss for the three months ended March 31, 2018: (in millions) As Previously Reported Adjustment As Revised Consolidated statement of operations Benefit from income taxes $ (3 ) $ (112 ) $ (115 ) Net loss (2,691 ) 112 (2,579 ) Net loss attributable to Bausch Health Companies Inc. (2,693 ) 112 (2,581 ) Basic and diluted loss per share attributable to Bausch Health Companies Inc. (7.68 ) 0.32 (7.36 ) Consolidated statement of comprehensive loss Foreign currency translation adjustment (46 ) 92 46 Other comprehensive (loss) income (46 ) 92 46 Comprehensive loss (2,737 ) 204 (2,533 ) Comprehensive loss (income) attributable to noncontrolling interest 2 (6 ) (4 ) Comprehensive loss attributable to Bausch Health Companies Inc. (2,735 ) 198 (2,537 ) The revision effects net loss and deferred income taxes presented on the statement of cash flows by $112 million , with no net impact to total cash flows provided by (used in) operating, investing or financing activities. Reclassifications Certain reclassifications have been made to prior year amounts to conform to the current year presentation. Changes in Reportable Segments Commencing in the second quarter of 2018, the Company operates in the following operating segments: (i) Bausch + Lomb/International, (ii) Salix, (iii) Ortho Dermatologics and (iv) Diversified Products. (Prior to the second quarter of 2018, the Company operated in the following operating segments: (i) Bausch + Lomb/International, (ii) Branded Rx, and (iii) U.S. Diversified Products.) The Bausch + Lomb/International segment consists of the: (i) U.S. Bausch + Lomb and (ii) International reporting units. The Salix segment consists of the Salix reporting unit (originally part of the former Branded Rx segment). The Ortho Dermatologics segment consists of the: (i) Ortho Dermatologics (originally part of the former Branded Rx segment) and (ii) Global Solta (originally part of the former Branded Rx segment) reporting units. The Diversified Products segment consists of the: (i) Neurology and other (originally part of the former U.S. Diversified Product segment), (ii) Generics (originally part of the former U.S. Diversified Product segment) and (iii) Dentistry (originally part of the former Branded Rx segment) reporting units. The Neurology and other reporting unit includes the: (i) oncology business (originally part of the former Branded Rx segment) and (ii) women's health business (originally part of the former Branded Rx segment). Upon divesting its equity interests in Dendreon Pharmaceuticals LLC (“Dendreon”) on June 28, 2017 and Sprout Pharmaceuticals, Inc. (“Sprout”) on December 20, 2017, the Company exited the oncology and women's health businesses, respectively. Prior period presentations of segment revenues and segment profits have been recast to conform to the current segment reporting structure. See Note 19, "SEGMENT INFORMATION" for additional information. Adoption of New Accounting Guidance In May 2014, the FASB issued guidance on recognizing revenue from contracts with customers. The core principle of the revenue model is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In applying the revenue model to contracts within its scope, an entity will: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when (or as) the entity satisfies a performance obligation. In addition to these provisions, the new standard provides implementation guidance on several other topics, including the accounting for certain revenue-related costs, as well as enhanced disclosure requirements. The new guidance requires entities to disclose both quantitative and qualitative information that enables users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. In March 2016, the FASB issued an amendment to clarify the implementation guidance around considerations whether an entity is a principal or an agent, impacting whether an entity reports revenue on a gross or net basis. In April 2016, the FASB issued an amendment to clarify guidance on identifying performance obligations and the implementation guidance on licensing. The guidance is effective for annual reporting periods beginning after December 15, 2017. Entities had the option of using either a full retrospective or a modified retrospective approach to adopt the guidance. The Company completed its detailed assessment and training program for its personnel. Pursuant to the detailed assessment program, the Company reviewed its revenue arrangements and assessed the differences in accounting for such contracts under the new guidance as compared with prior revenue accounting guidance. Based upon review of current customer contracts, the Company concluded the implementation of the new guidance did not have a material quantitative impact on its consolidated financial statements as the timing of revenue recognition for product sales did not significantly change. The Company adopted this guidance effective January 1, 2018 using the modified retrospective approach. Accordingly, the amounts reported in the prior period have not been restated. The new guidance did however result in additional disclosures as to the nature, amounts, and concentrations of revenue. See Note 3, "REVENUE RECOGNITION" and Note 19, "SEGMENT INFORMATION" for additional details and the application of this guidance. In October 2016, the FASB issued guidance requiring an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs, rather than when the asset has been sold to an outside party. This guidance was effective for the Company January 1, 2018 and was applied using a modified retrospective approach through a cumulative-effect adjustment to accumulated deficit and deferred income taxes as of the effective date. The Company recorded a net cumulative-effect adjustment of $1,209 million to increase deferred income tax assets and decrease the opening balance of Accumulated deficit for the income tax consequences deferred from past intra-entity transfers involving assets other than inventory. In January 2017, the FASB issued guidance which clarifies the definition of a business with the objective of assisting with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The Company prospectively applied the new definition to all transactions effective January 1, 2018. In January 2017, the FASB issued guidance which simplifies the subsequent measurement of goodwill by eliminating “Step 2” from the goodwill impairment test. Instead, goodwill impairment is measured as the amount by which a reporting unit's carrying value exceeds its fair value. The FASB also eliminated the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment. The guidance is effective for annual periods beginning after December 15, 2019, and interim periods within those annual periods, with early adoption permitted. The Company elected to adopt this guidance effective January 1, 2018. The Company tested goodwill for impairment upon adopting this guidance and recognized impairment charges of $2,213 million , related to its Salix reporting unit and Ortho Dermatologics reporting unit at January 1, 2018. See Note 8, "INTANGIBLE ASSETS AND GOODWILL" for additional details and the application of this guidance. Recently Issued Accounting Standards, Not Adopted as of June 30, 2018 In February 2016, the FASB issued guidance on lease accounting to increase transparency and comparability among organizations that lease buildings, equipment, and other assets by requiring the recognition of lease assets and lease liabilities on the balance sheet. Consistent with the current lease accounting standard, leases will continue to be classified as finance leases or operating leases. The classification is determined based on whether the risks and rewards, as well as substantive control, have been transferred to the Company and its determination will govern the pattern of lease cost recognition. Finance leases will be accounted for in substantially the same manner as capital leases are accounted for under current U.S. GAAP. Operating leases will be accounted for (both in the statement of operations and statement of cash flows) in a manner consistent with operating leases under existing U.S. GAAP. However, as it relates to the balance sheet, lessees will recognize lease liabilities based upon the present value of remaining lease payments and corresponding right of use lease assets for operating leases with limited exception. The new guidance will also require lessees and lessors to provide additional qualitative and quantitative disclosures to help financial statement users assess the amount, timing, and uncertainty of cash flows arising from leases. The new guidance is effective for annual reporting periods beginning after December 15, 2018. Early application is permitted. The Company will adopt the standard on January 1, 2019, and is electing to apply the modified retrospective approach to recognize a cumulative-effect adjustment to accumulated deficit at the adoption date. The Company also intends to elect the available practical expedients upon adoption. The Company has an implementation project in place and is progressing on the project plan for adopting this guidance. It includes a detailed assessment program and the selection of a third-party software to assist in complying with the new standard. Although the Company anticipates that the inclusion of lease related assets and liabilities will have a material impact on the consolidated balance sheets, the Company believes its adoption will not have a material impact on the consolidated statements of operations upon adoption. While the Company is still in the process of finalizing the assessment of the impacts on the consolidated balance sheets, based on the assessment to date, the Company currently believes the most significant impact relates to assets and liabilities arising from facilities, vehicles and equipment operating leases. The Company expects that accounting for capital leases will remain substantially unchanged under the new standard. The Company does not have material lessor activity that would be impacted by the standard. In June 2016, the FASB issued guidance on the impairment of financial instruments requiring an impairment model based on expected losses rather than incurred losses. Under this guidance, an entity recognizes as an allowance its estimate of expected credit losses. The guidance is effective for annual periods beginning after December 15, 2019, and interim periods within those annual periods. Early adoption is permitted for annual periods beginning after December 15, 2018, and interim periods within those annual periods. The Company is evaluating the impact of adoption of this guidance on its financial position, results of operations and cash flows. |
REVENUE RECOGNITION
REVENUE RECOGNITION | 6 Months Ended |
Jun. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | REVENUE RECOGNITION The Company’s revenues are primarily generated from product sales that consist of: (i) branded pharmaceuticals, (ii) generic and branded generic pharmaceuticals, (iii) OTC products and (iv) medical devices (contact lenses, intraocular lenses, ophthalmic surgical equipment, and aesthetics devices). Other revenues include alliance and service revenue from the licensing and co-promotion of products and contract service revenue primarily in the areas of dermatology and topical medication. Contract service revenue is derived primarily from contract manufacturing for third parties and is not material. See Note 19, "SEGMENT INFORMATION" for the disaggregation of revenue which depicts how the nature, amount, timing and uncertainty of revenue and cash flows are affected by the economic factors of each category of customer contracts. Product Sales The Company recognizes revenue when the customer obtains control of promised goods or services and in an amount that reflects the consideration to which the Company expects to be entitled to receive in exchange for those goods or services. To achieve this core principle, the Company applies the five-step revenue model to contracts within its scope: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when (or as) the entity satisfies a performance obligation. A contract with the Company’s customers exists for each product sale. Where a contract with a customer contains more than one performance obligation, the Company allocates the transaction price to each distinct performance obligation based on its relative standalone selling price. The transaction price is adjusted for variable consideration which is discussed further below. The Company generally recognizes revenue for product sales at a point in time, when the customer obtains control of the products. Product Sales Provisions As is customary in the pharmaceutical industry, gross product sales are subject to a variety of deductions in arriving at reported net product sales. The transaction price for product sales is typically adjusted for variable consideration, which may be in the form of cash discounts, allowances, returns, rebates, chargebacks and distribution fees paid to customers. Provisions for variable consideration are established to reflect the Company’s best estimates of the amount of consideration to which it is entitled based on the terms of the contract. The amount of variable consideration included in the transaction price may be constrained, and is included in the net sales price only to the extent that it is probable that a significant reversal in the amount of the cumulative revenue recognized will not occur in the future period. Provisions for these deductions are recorded concurrently with the recognition of gross product sales revenue and include cash discounts and allowances, chargebacks, and distribution fees, which are paid to direct customers, as well as rebates and returns, which can be paid to direct and indirect customers. Returns provision balances and volume discounts to direct customers are included in Accrued and other current liabilities. All other provisions related to direct customers are included in Trade receivables, net, while provision balances related to indirect customers are included in Accrued and other current liabilities. The following table presents the activity and ending balances of the Company’s variable consideration provisions for the six months ended June 30, 2018 . Six Months Ended June 30, 2018 (in millions) Discounts and Allowances Returns Rebates Chargebacks Distribution Fees Total Reserve balance, January 1, 2018 $ 167 $ 863 $ 1,094 $ 274 $ 148 $ 2,546 Current period provision 406 163 1,330 947 116 2,962 Payments or credits (409 ) (185 ) (1,287 ) (971 ) (120 ) (2,972 ) Reserve balance, June 30, 2018 $ 164 $ 841 $ 1,137 $ 250 $ 144 $ 2,536 The Company continually monitors its variable consideration provisions and evaluates the estimates used as additional information becomes available. Adjustments will be made to these provisions periodically to reflect new facts and circumstances that may indicate that historical experience may not be indicative of current and/or future results. The Company is required to make subjective judgments based primarily on its evaluation of current market conditions and trade inventory levels related to the Company's products. This evaluation may result in an increase or decrease in the experience rate that is applied to current and future sales, or an adjustment related to past sales, or both. If the actual amounts paid vary from the Company’s estimates, the Company adjusts these estimates, which would affect net product revenue and earnings in the period such variance becomes known. The Company applies this method consistently for contracts with similar characteristics. The following describes the major sources of variable consideration in the Company’s customer arrangements and the methodology, estimates and judgments applied to estimate each type of variable consideration. Cash Discounts and Allowances Cash discounts are offered for prompt payment and allowances for volume purchases. Provisions for cash discounts are estimated at the time of sale and recorded as direct reductions to trade receivables and revenue. Management estimates the provisions for cash discounts and allowances based on contractual sales terms with customers, an analysis of unpaid invoices and historical payment experience. Estimated cash discounts and allowances have historically been predictable and less subjective, due to the limited number of assumptions involved, the consistency of historical experience and the fact that these amounts are generally settled within one month of incurring the liability. Returns Consistent with industry practice, customers are generally allowed to return product within a specified period of time before and after its expiration date, excluding European businesses which generally do not carry a right of return. The returns provision is estimated utilizing historical sales and return rates over the period during which customers have a right of return, taking into account available information on competitive products and contract changes. The information utilized to estimate the returns provision includes: (i) historical return and exchange levels, (ii) external data with respect to inventory levels in the wholesale distribution channel, (iii) external data with respect to prescription demand for products, (iv) remaining shelf lives of products at the date of sale and (v) estimated returns liability to be processed by year of sale based on an analysis of lot information related to actual historical returns. In determining the estimate for returns, management is required to make certain assumptions regarding the timing of the introduction of new products and the potential of these products to capture market share. In addition, certain assumptions with respect to the extent and pattern of decline associated with generic competition are necessary. These assumptions are formulated using market data for similar products, past experience and other available information. These assumptions are continually reassessed, and changes to the estimates and assumptions are made as new information becomes available. A change of 1% in the estimated return rates would have impacted the Company’s pre-tax earnings by approximately $45 million for the six months ended June 30, 2018 . The estimate for returns may be impacted by a number of factors, but the principal factor relates to the inventory levels in the distribution channel. When management becomes aware of an increase in such inventory levels, it considers whether the increase may be temporary or other-than-temporary. Temporary increases in wholesaler inventory levels will not differ from original estimates of provision for returns. Other-than-temporary increases in wholesaler inventory levels, however, may be an indication that future product returns could be higher than originally anticipated, and, as a result, estimates for returns may need to be adjusted. Factors that suggest increases in wholesaler inventory levels are temporary include: (i) recently implemented or announced price increases for certain products; (ii) new product launches or expanded indications for existing products; and (iii) timing of purchases by wholesale customers. Conversely, factors that suggest increases in wholesaler inventory levels are other-than-temporary include: (i) declining sales trends based on prescription demand; (ii) introduction of new products or generic competition; (iii) increasing price competition from generic competitors; and (iv) recent changes to the U.S. National Drug Codes (“NDC”) of products. Changes in the NDC of products could result in a period of higher returns related to products with the old NDC, as U.S. customers generally permit only one NDC per product for identification and tracking within their inventory systems. Rebates and Chargebacks Product sales made under governmental and managed-care pricing programs in the U.S. are subject to rebates. The Company participates in state government-managed Medicaid programs, as well as certain other qualifying federal and state government programs whereby rebates are provided to participating government entities. Medicaid rebates are generally billed 45 days after the quarter, but can be billed up to 270 days after the quarter in which the product is dispensed to the Medicaid participant. As a result, the Medicaid rebate reserve includes an estimate of outstanding claims for end-customer sales that occurred, but for which the related claim has not been billed and/or paid, and an estimate for future claims that will be made when inventory in the distribution channel is sold through to plan participants. The calculation of the Medicaid rebate reserve also requires other estimates, such as estimates of sales mix, to determine which sales are subject to rebates and the amount of such rebates. A change of 1% in the volume of product sold through to Medicaid plan participants would have impacted the Company’s pre-tax earnings by approximately $44 million for the six months ended June 30, 2018 . Quarterly, the Medicaid rebate reserve is adjusted based on actual claims paid. Due to the delay in billing, adjustments to actual claims paid may incorporate revisions of that reserve for several periods. Managed Care rebates relate to contractual agreements to sell products to managed care organizations and pharmacy benefit managers at contractual rebate percentages in exchange for volume and/or market share. Chargebacks relate to contractual agreements to sell products to government agencies, group purchasing organizations and other indirect customers at contractual prices that are lower than the list prices the Company charges wholesalers. When these group purchasing organizations or other indirect customers purchase products through wholesalers at these reduced prices, the wholesaler charges the Company for the difference between the prices they paid the Company and the prices at which they sold the products to the indirect customers. In estimating provisions for rebates and chargebacks, management considers relevant statutes with respect to governmental pricing programs and contractual sales terms with managed-care providers and group purchasing organizations. Management estimates the amount of product sales subject to these programs based on historical utilization levels. Changes in the level of utilization of products through private or public benefit plans and group purchasing organizations will affect the amount of rebates and chargebacks that the Company is obligated to pay. Management continually updates these factors based on new contractual or statutory requirements, and any significant changes in sales trends that may impact the percentage of products subject to rebates or chargebacks. The amount of Managed Care, Medicaid and other rebates and chargebacks has become more significant as a result of a combination of deeper discounts due to the price increases implemented in each of the last three years, changes in the Company’s product portfolio due to recent acquisitions and increased Medicaid utilization due to expansion of government funding for these programs. Management’s estimate for rebates and chargebacks may be impacted by a number of factors, but the principal factor relates to the level of inventory in the distribution channel. Rebate provisions are based on factors such as timing and terms of plans under contract, time to process rebates, product pricing, sales volumes, amount of inventory in the distribution channel and prescription trends. Adjustments to actual for the six months ended June 30, 2018 and 2017 were not material to the Company’s revenues or earnings. Patient Co-Pay Assistance programs, Consumer Rebates and Loyalty Programs are rebates offered on many of the Company’s products. Patient Co-Pay Assistance Programs are patient discount programs offered in the form of coupon cards or point of sale discounts, with which patients receive certain discounts off their prescription at participating pharmacies, as defined by the specific product program. An accrual for these programs is established, equal to management’s estimate of the discount, rebate and loyalty incentives attributable to a sale. That estimate is based on historical experience and other relevant factors. The accrual is adjusted throughout each quarter based on actual experience and changes in other factors, if any, to ensure the balance is fairly stated. Distribution Fees The Company sells product primarily to wholesalers, and in some instances to large pharmacy chains such as CVS and Wal-Mart. The Company has Distribution Services Agreements ("DSAs") with several large wholesale customers such as McKesson Corporation, AmerisourceBergen Corporation, Cardinal Health, Inc. and McKesson Specialty. Under the DSAs, the wholesalers agree to provide services, and the Company pays the contracted DSA distribution service fees for these services based on product volumes. Additionally, price appreciation credits are generated when the Company increases a product’s wholesaler acquisition cost (“WAC”) under contracts with certain wholesalers. Under such contracts, the Company is entitled to credits from such wholesalers for the impact of that WAC increase on inventory currently on hand at the wholesalers. Such credits are offset against the total distribution service fees paid to each such wholesaler. The variable consideration associated with price appreciation credits is reflected in the transaction price of products sold when it is determined to be probable that a significant reversal will not occur. Net revenue from price appreciation credits for the six months ended June 30, 2018 was $15 million and is included as a deduction to distribution fees in the table above of the Company's variable consideration provisions. Contract Assets and Contract Liabilities There are no contract assets for any period presented. Contract liabilities consist of deferred revenue, the balance of which is not material to any period presented. Sales Commissions The Company expenses sales commissions when incurred because the amortization period would have been less than one year. Sales commissions are included in selling, general and administrative expenses. Financing Component The Company has elected not to adjust consideration for the effects of a significant financing component when the period between the transfer of a promised good or service to the customer and when the customer pays for that good or service will be one year or less. The Company's global payment terms are generally between thirty to ninety days. |
DIVESTITURES
DIVESTITURES | 6 Months Ended |
Jun. 30, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DIVESTITURES | DIVESTITURES In 2017, the Company divested certain businesses and assets, which, in each case, were not aligned with its core business objectives. CeraVe ® , AcneFree™ and AMBI ® skincare brands On March 3, 2017, the Company completed the sale of its interests in the CeraVe ® , AcneFree™ and AMBI ® skincare brands for $1,300 million in cash (the “Skincare Sale”), subject to the finalization of certain working capital provisions. The CeraVe ® , AcneFree™ and AMBI ® skincare business was part of the Bausch + Lomb/International segment and was reclassified as held for sale as of December 31, 2016. Included in Other expense (income), net for the six months ended June 30, 2017 is the Gain on the Skincare Sale of $319 million . The working capital provisions were finalized during 2017 and the Gain on the Skincare Sale was adjusted to $309 million . Dendreon Pharmaceuticals LLC On June 28, 2017, the Company completed the sale of all outstanding equity interests in Dendreon for $845 million in cash (the “Dendreon Sale”), as adjusted. Dendreon was part of the former Branded Rx segment and was reclassified as held for sale as of December 31, 2016. Included in Other expense (income), net is the Gain on the Dendreon Sale of $73 million , as adjusted, during the three months ended June 30, 2017. The working capital provisions were finalized during 2017 and the Gain on the Dendreon Sale was adjusted to $97 million . Restricted cash as of June 30, 2017 includes $811 million of proceeds from the Dendreon Sale which the Company used to repay its Series F Tranche B Term Loan Facility on July 3, 2017. iNova Pharmaceuticals On September 29, 2017 , the Company completed the sale of its Australian-based iNova Pharmaceuticals (“iNova”) business for $938 million in cash (the “iNova Sale”), as adjusted, and subject to the finalization of certain working capital provisions. iNova markets a diversified portfolio of weight management, pain management, cardiology and cough and cold prescription and OTC products in more than 15 countries, with leading market positions in Australia and South Africa, as well as an established platform in Asia. The Company will continue to operate in these geographies through the Bausch + Lomb franchise. The iNova business was part of the Bausch + Lomb/International segment and was reclassified as held for sale as of December 31, 2016. Included in Other expense (income), net is the Gain on the iNova Sale of $309 million , as adjusted, during the three months ended September 30, 2017. Obagi Medical Products, Inc. On November 9, 2017 , certain of the Company's affiliates completed the sale of its Obagi Medical Products, Inc. (“Obagi”) business for $190 million in cash (the “Obagi Sale”). Obagi is a global specialty skin care pharmaceutical business with products focused on premature skin aging, skin damage, hyperpigmentation, acne and sun damage which are primarily available through dermatologists, plastic surgeons and other skin care professionals. The Obagi business was part of the former U.S. Diversified Products segment and was reclassified as held for sale as of March 31, 2017. The carrying value of the Obagi business, including associated goodwill, was adjusted to its estimated fair value less costs to sell and an impairment of $103 million was recognized in Asset impairments during the six months ended June 30, 2017. Included in Other expense (income), net is a $13 million loss related to this transaction during the three months ended December 31, 2017. Sprout Pharmaceuticals, Inc. On December 20, 2017 , the Company completed the sale of all outstanding equity interests in Sprout to a buyer affiliated with certain former shareholders of Sprout (the “Sprout Sale”), in exchange for a 6% royalty on global sales of Addyi ® (flibanserin 100 mg) beginning June 2019. In connection with the completion of the Sprout Sale, the terms of the October 2015 merger agreement relating to the Company's acquisition of Sprout were amended to terminate the Company's ongoing obligation to make future royalty payments associated with the Addyi ® product, as well as certain related provisions (including the obligation to make certain marketing and other expenditures). In connection with the completion of the Sprout Sale, the litigation against the Company, initiated on behalf of the former shareholders of Sprout, which disputed the Company's compliance with certain contractual terms of that same merger agreement with respect to the use of certain diligent efforts to develop and commercialize the Addyi ® product (including a disputed contractual term with respect to the spend of no less than $200 million in certain expenditures), was dismissed with prejudice. In connection with the completion of the Sprout Sale, the Company issued the buyer a five -year $25 million loan for initial operating expenses. Addyi ® , a once-daily, non-hormonal tablet approved for the treatment of acquired, generalized hypoactive sexual desire disorder in premenopausal women, was Sprout's only approved and commercialized product. Sprout was part of the former Branded Rx segment and was reclassified as held for sale as of September 30, 2017. The carrying value of the Sprout business, including associated goodwill, was adjusted to its estimated fair value less costs to sell and a $352 million impairment was recognized in Asset impairments during the three months ended December 31, 2017. Upon consummation of the transaction, a loss of $98 million was recognized in Other expense (income), net during the three months ended December 31, 2017. The Company will recognize the agreed upon 6% royalty of global sales of Addyi ® beginning in June 2019 as these royalties become due, as the Company does not recognize contingent payments until such amounts are realizable. Assets Held For Sale At June 30, 2018 , included in Prepaid expenses and other current assets and Other non-current assets are assets held for sale of $1 million and $11 million , respectively. At December 31, 2017, included in Other non-current assets are assets held for sale of $12 million . |
RESTRUCTURING AND INTEGRATION C
RESTRUCTURING AND INTEGRATION COSTS | 6 Months Ended |
Jun. 30, 2018 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING AND INTEGRATION COSTS | RESTRUCTURING AND INTEGRATION COSTS In connection with acquisitions prior to 2016, the Company implemented cost-rationalization and integration initiatives to capture operating synergies and generate cost savings. These measures included: (i) workforce reductions company-wide and other organizational changes, (ii) closing of duplicative facilities and other site rationalization actions company-wide, including research and development facilities, sales offices and corporate facilities, (iii) leveraging research and development spend and (iv) procurement savings. The remaining liability associated with these Restructuring and integration costs as of June 30, 2018 was $39 million . During the six months ended June 30, 2018 , the Company incurred $13 million of Restructuring and integration costs . These costs included: (i) $8 million of severance costs and (ii) $5 million of facility closure costs. The Company made payments of $13 million for the six months ended June 30, 2018 . During the six months ended June 30, 2017 , the Company incurred $36 million of Restructuring and integration costs . These costs included: (i) $15 million of integration consulting, duplicate labor, transition service, and other costs, (ii) $14 million of facility closure costs and (iii) $7 million of severance costs. These costs primarily related to restructuring and integration costs for other smaller acquisitions. The Company made payments of $49 million for the six months ended June 30, 2017 . The Company continues to evaluate opportunities to improve its operating results and may initiate additional cost savings programs to streamline its operations and eliminate redundant processes and expenses. The expenses associated with the implementation of these cost savings programs could be material and may include, but are not limited to, expenses associated with: (i) reducing headcount, (ii) eliminating real estate costs associated with unused or under-utilized facilities and (iii) implementing contribution margin improvement and other cost reduction initiatives. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Fair value measurements are estimated based on valuation techniques and inputs categorized as follows: • Level 1 — Quoted prices in active markets for identical assets or liabilities; • Level 2 — Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities; and • Level 3 — Unobservable inputs that are supported by little or no market activity and that are financial instruments whose values are determined using discounted cash flow methodologies, pricing models, or similar techniques, as well as instruments for which the determination of fair value requires significant judgment or estimation. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. Assets and Liabilities Measured at Fair Value on a Recurring Basis The following fair value hierarchy table presents the components and classification of the Company’s financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2018 and December 31, 2017 : June 30, 2018 December 31, 2017 (in millions) Carrying Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Carrying Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents $ 284 $ 244 $ 40 $ — $ 265 $ 230 $ 35 $ — Restricted cash $ — $ — $ — $ — $ 77 $ 77 $ — $ — Liabilities: Acquisition-related contingent consideration $ (364 ) $ — $ — $ (364 ) $ (387 ) $ — $ — $ (387 ) Cash and cash equivalents consist of highly liquid investments with maturities of three months or less when purchased, primarily including money market funds, reflected in the balance sheet at carrying value, which approximates fair value due to their short-term nature. Restricted cash of $77 million as of December 31, 2017 was deposited with a bank as collateral to secure a bank guarantee. On January 9, 2018, the cash collateral of $77 million of Restricted cash was returned to the Company in exchange for a $77 million letter of credit. There were no transfers between Level 1, Level 2, or Level 3 during the six months ended June 30, 2018 . Assets and Liabilities Measured at Fair Value on a Recurring Basis Using Significant Unobservable Inputs (Level 3) The fair value measurement of contingent consideration obligations arising from business combinations is determined via a probability-weighted discounted cash flow analysis or Monte Carlo Simulation, using unobservable (Level 3) inputs. These inputs may include: (i) the estimated amount and timing of projected cash flows; (ii) the probability of the achievement of the factor(s) on which the contingency is based; (iii) the risk-adjusted discount rate used to present value the probability-weighted cash flows; and (iv) volatility of projected performance (Monte Carlo Simulation). Significant increases (decreases) in any of those inputs in isolation could result in a significantly lower (higher) fair value measurement. The following table presents a reconciliation of contingent consideration obligations measured on a recurring basis using significant unobservable inputs (Level 3) for the six months ended June 30, 2018 : (in millions) Balance, January 1, 2018 $ 387 Adjustments to Acquisition-related contingent consideration: Accretion for the time value of money $ 12 Fair value adjustments due to changes in estimates of future payments (16 ) Acquisition-related contingent consideration (4 ) Foreign currency translation adjustment included in other comprehensive loss 1 Payments (20 ) Balance, June 30, 2018 364 Current portion included in Accrued and other current liabilities 54 Non-current portion $ 310 Fair Value of Long-term Debt The fair value of long-term debt as of June 30, 2018 and December 31, 2017 was $24,995 million and $25,385 million , respectively, and was estimated using the quoted market prices for the same or similar debt issuances (Level 2) . |
INVENTORIES
INVENTORIES | 6 Months Ended |
Jun. 30, 2018 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES The components of inventories, net of allowances for obsolescence were as follows: (in millions) June 30, December 31, Raw materials $ 274 $ 276 Work in process 130 146 Finished goods 589 626 $ 993 $ 1,048 |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE ASSETS AND GOODWILL | INTANGIBLE ASSETS AND GOODWILL Intangible Assets The major components of intangible assets were as follows: June 30, 2018 December 31, 2017 (in millions) Gross Carrying Amount Accumulated Amortization and Impairments Net Carrying Amount Gross Carrying Amount Accumulated Amortization and Impairments Net Carrying Amount Finite-lived intangible assets: Product brands $ 20,918 $ (10,859 ) $ 10,059 $ 20,913 $ (9,281 ) $ 11,632 Corporate brands 927 (226 ) 701 933 (179 ) 754 Product rights/patents 3,297 (2,475 ) 822 3,310 (2,346 ) 964 Partner relationships 169 (164 ) 5 179 (169 ) 10 Technology and other 209 (165 ) 44 214 (147 ) 67 Total finite-lived intangible assets 25,520 (13,889 ) 11,631 25,549 (12,122 ) 13,427 Acquired IPR&D not in service 64 — 64 86 — 86 Bausch + Lomb Trademark 1,698 — 1,698 1,698 — 1,698 $ 27,282 $ (13,889 ) $ 13,393 $ 27,333 $ (12,122 ) $ 15,211 Long-lived assets with finite lives are tested for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. The Company continues to monitor the recoverability of its finite-lived intangible assets and tests the intangible assets for impairment if indicators of impairment are present. Asset impairments for the six months ended June 30, 2018 include: (i) impairments of $323 million reflecting decreases in forecasted sales for the Uceris ® Tablet product and other product lines due to generic competition, (ii) impairments of $17 million , in aggregate, related to certain product/patent assets associated with the discontinuance of specific product lines not aligned with the focus of the Company's core businesses and revisions to forecasted sales and (iii) $5 million related to assets being classified as held for sale. Asset impairments for the six months ended June 30, 2017 include: (i) impairments of $113 million to assets classified as held for sale, (ii) impairments of $80 million to certain product/patent assets associated with the discontinuance of specific product lines not aligned with the focus of the Company's core businesses, (iii) an impairment of $17 million reflecting a decrease in forecasted sales for a specific product line and (iv) impairments of $13 million reflecting decreases in forecasted sales for other product lines. The impairments to assets classified as held for sale were measured as the difference of the carrying value of these assets as compared to the estimated fair value of these assets less costs to sell determined using a discounted cash flow analysis which utilized unobservable inputs (Level 3). The other impairments and adjustments to finite-lived intangible assets were measured as the difference of the carrying value of these finite-lived assets as compared to the fair value as determined using a discounted cash flow analysis using unobservable inputs (Level 3). Periodically, the Company’s products face the expiration of their patent or regulatory exclusivity. Shortly following a loss of exclusivity of a product, the Company anticipates that product sales for such product would decrease due to the possible entry of a generic competitor. Where the Company has the rights, it may elect to launch an authorized generic of such product (either as the Company’s own branded generic or through a third party). This may occur prior to, upon or following generic entry, which may mitigate the anticipated decrease in product sales; however, even with launch of an authorized generic, the decline in product sales of such product could still be significant, and the effect on future revenues could be material. As a result of the launch of a generic competitor in July 2018, the Company revised its near and long-term financial projections of the Uceris ® Tablet related intangible assets. As of June 30, 2018, the carrying value of the Uceris ® Tablet related intangible assets exceeded the undiscounted expected cash flows from the Uceris ® Tablet. As a result, the Company recognized an impairment of $263 million to reduce the carrying value of the Uceris ® Tablet related intangible assets to their estimated fair value. As of June 30, 2018 , the remaining carrying value of the Uceris ® Tablet related intangible assets was $187 million . Prior to its launch, the Company initiated infringement proceedings against this generic competitor. The Company continues to believe that its Uceris ® Tablet related patents are enforceable and is proceeding in the ongoing litigation between the Company and the generic competitor, however the ultimate outcome of the matter is not predictable. Estimated amortization expense, for the remainder of 2018 and each of the five succeeding years ending December 31 and thereafter is as follows: (in millions) July through December 2018 $ 1,364 2019 2,531 2020 2,261 2021 2,008 2022 1,835 2023 636 Thereafter 996 Total $ 11,631 Goodwill The changes in the carrying amounts of goodwill during the six months ended June 30, 2018 and the year ended December 31, 2017 were as follows: (in millions) Bausch + Lomb/ International Branded Rx U.S. Diversified Products Salix Ortho Dermatologics Diversified Products Total Balance, December 31, 2016 $ 5,499 $ 7,265 $ 3,030 $ — $ — $ — $ 15,794 Realignment of segment goodwill 264 (264 ) — — — — — Balance, January 1, 2017 5,763 7,001 3,030 — — — 15,794 Goodwill reclassified to assets held for sale and subsequently disposed (30 ) (61 ) (84 ) — — — (175 ) Impairment — (312 ) — — — — (312 ) Foreign exchange and other 283 3 — — — — 286 Balance, December 31, 2017 6,016 6,631 2,946 — — — 15,593 Impairment — (2,213 ) — — — — (2,213 ) Realignment of Global Solta reporting unit goodwill (82 ) 115 (33 ) — — — — Goodwill reclassified to assets held for sale (2 ) — — — — — (2 ) Foreign exchange and other 54 — — — — — 54 Balance, March 31, 2018 5,986 4,533 2,913 — — — 13,432 Realignment of segment goodwill — (4,533 ) (2,913 ) 3,156 1,267 3,023 — Balance after realignment 5,986 — — 3,156 1,267 3,023 13,432 Foreign exchange and other (149 ) — — — — — (149 ) Balance, June 30, 2018 $ 5,837 $ — $ — $ 3,156 $ 1,267 $ 3,023 $ 13,283 Goodwill is not amortized but is tested for impairment at least annually at the reporting unit level. A reporting unit is the same as, or one level below, an operating segment. The fair value of a reporting unit refers to the price that would be received to sell the unit as a whole in an orderly transaction between market participants. The Company estimates the fair values of all reporting units using a discounted cash flow model which utilizes Level 3 unobservable inputs. The discounted cash flow model relies on assumptions regarding revenue growth rates, gross profit, projected working capital needs, selling, general and administrative expenses, research and development expenses, capital expenditures, income tax rates, discount rates and terminal growth rates. To estimate fair value, the Company discounts the forecasted cash flows of each reporting unit. The discount rate the Company uses represents the estimated weighted average cost of capital, which reflects the overall level of inherent risk involved in its reporting unit operations and the rate of return a market participant would expect to earn. To estimate cash flows beyond the final year of its model, the Company estimates a terminal value by applying an in perpetuity growth assumption and discount factor to determine the reporting unit's terminal value. The Company forecasts cash flows for each reporting unit and takes into consideration economic conditions and trends, estimated future operating results, management's and a market participant's view of growth rates and product lives, and anticipates future economic conditions. Revenue growth rates inherent in these forecasts were based on input from internal and external market research that compare factors such as growth in global economies, recent industry trends and product life-cycles. Macroeconomic factors such as changes in economies, changes in the competitive landscape including the unexpected loss of exclusivity to the Company's product portfolio, changes in government legislation, product life-cycles, industry consolidations and other changes beyond the Company’s control could have a positive or negative impact on achieving its targets. Accordingly, if market conditions deteriorate, or if the Company is unable to execute its strategies, it may be necessary to record impairment charges in the future. 2017 2017 Realignment of Segment Structure Effective for the first quarter of 2017, the revenues and profits from the Company's operations in Canada were reclassified. In connection with this change, the prior-period presentation of segment goodwill has been recast to conform to the current reporting structure, of which $264 million of goodwill as of December 31, 2016 was reclassified from the former Branded Rx segment to the Bausch + Lomb/International segment. No facts or circumstances were then identified in connection with this change in alignment that would suggest an impairment exists. 2017 Impairment On December 20, 2017 , the Company completed the sale of Sprout to a buyer affiliated with certain former shareholders of Sprout. Sprout was part of the former Branded Rx segment and was reclassified as held for sale as of September 30, 2017. As the Sprout business represented only a portion of a former Branded Rx reporting unit, the Company assessed the remaining reporting unit for impairment and determined the carrying value of the remaining reporting unit exceeded its fair value. After completing step two of the impairment testing, the Company determined and recorded a goodwill impairment charge of $312 million during the three months ended September 30, 2017. 2018 Adoption of New Accounting Guidance for Goodwill Impairment Testing In January 2017, the FASB issued guidance which simplifies the subsequent measurement of goodwill by eliminating “Step 2” from the goodwill impairment test. Instead, goodwill impairment is measured as the amount by which a reporting unit's carrying value exceeds its fair value. The FASB also eliminated the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment. The guidance is effective for annual periods beginning after December 15, 2019, and interim periods within those annual periods, with early adoption permitted. The Company elected to adopt this guidance effective January 1, 2018. Upon adopting the new guidance, the Company tested goodwill for impairment and determined that the carrying value of the Salix reporting unit exceeded its fair value. As a result of the adoption of new accounting guidance, the Company recognized a goodwill impairment of $1,970 million associated with the Salix reporting unit. As of October 1, 2017, the date of the 2017 annual impairment test, the fair value of the Ortho Dermatologics reporting unit exceeded its carrying value. However, at January 1, 2018, the carrying value of the Ortho Dermatologics reporting unit exceeded its fair value. Unforeseen changes in the business dynamics of the Ortho Dermatologics reporting unit, such as: (i) changes in the dermatology sector, (ii) increased pricing pressures from third-party payors, (iii) additional risks to the exclusivity of certain products and (iv) an expected longer launch cycle for a new product, were factors that negatively impacted the reporting unit's operating results beyond management's expectations as of October 1, 2017, when the Company performed its 2017 annual goodwill impairment test. In response to these adverse business indicators, the Company reduced its near and long term financial projections for the Ortho Dermatologics reporting unit. As a result of the reductions in the near and long term financial projections, the carrying value of the Ortho Dermatologics reporting unit exceeded its fair value at January 1, 2018 and the Company recognized a goodwill impairment of $243 million . As of January 1, 2018, the fair value of all other reporting units exceeded their respective carrying value by more than 15% . 2018 Realignment of Solta Business Effective March 1, 2018, revenues and profits from the U.S. Solta business included in the former U.S. Diversified Products segment in prior periods and revenues and profits from the international Solta business included in the Bausch + Lomb/International segment in prior periods, are reported in the new Global Solta reporting unit, which, at that time, was a part of the former Branded Rx segment. As a result of this change, $115 million of goodwill was reallocated to the new Global Solta reporting unit and the Company assessed the impact on the fair values of each of the reporting units affected. After considering, among other matters: (i) the limited period of time between last impairment test (January 1, 2018) and the realignment (March 1, 2018), (ii) the results of the last impairment test and (iii) the amount of goodwill reallocated to the new Global Solta reporting unit, the Company did not identify any indicators of impairment at the time of the realignment. March 31, 2018 Except for the impact of the adoption of the new accounting guidance for goodwill impairment testing noted above, no additional events occurred or circumstances changed during the period January 1, 2018 (the date goodwill was last tested for impairment) through March 31, 2018 that would indicate that the fair value of any reporting unit might be below its carrying value. As a result, management concluded that the fair value of the Salix and Ortho Dermatologics reporting units marginally exceed their carrying values as of March 31, 2018. Therefore, during the three months ended March 31, 2018, the Company performed qualitative assessments of the Salix reporting unit and Ortho Dermatologics reporting unit to determine if testing was warranted. As part of its qualitative assessments, management compared the reporting units' operating results to its original forecasts. The latest forecasts as of March 31, 2018 for the Salix and Ortho Dermatologics reporting units were not materially different than the forecast used in management's January 1, 2018 testing and the difference in the forecasts would not change the conclusion of the Company’s goodwill impairment testing as of January 1, 2018. As part of these qualitative assessments, the Company also considered the sensitivity of its conclusions as they relate to changes in the estimates and assumptions used in the latest forecast available for each period. Based on its qualitative assessments, management believed that the carrying value of these reporting units did not exceed their respective fair values. 2018 Realignment of Segment Structure Commencing in the second quarter of 2018, the Company operates in the following reportable segments: (i) Bausch + Lomb/International segment, (ii) Salix segment, (iii) Ortho Dermatologics segment and (iv) Diversified Products segment. The Bausch + Lomb/International segment consists of the: (i) U.S. Bausch + Lomb and (ii) International reporting units. The Salix segment consists of the Salix reporting unit. The Ortho Dermatologics segment consists of the: (i) Ortho Dermatologics and (ii) Global Solta reporting units. The Diversified Products segment consists of the: (i) Neurology and other, (ii) Generics and (iii) Dentistry reporting units. There was no triggering event which would require the Company to test goodwill for impairment as a result of the second quarter realignment of the segment structure as it did not result in a change in the reporting units. June 30, 2018 During the three months ended June 30, 2018, the Company made certain revisions to its forecasts for the Salix reporting unit. The revisions reflected, among other matters: (i) the launch of a generic competitor in July 2018 to the Company’s Uceris ® Tablet product, (ii) the improved performance of the remaining Salix product portfolio, including the Xifaxan ® products and (iii) certain other assumptions used in preparing its discounted cash flow model. Using the revised forecasts, management performed a qualitative assessment of the Salix reporting unit to determine if testing was warranted. As part of this assessment, management compared the reporting unit’s operating results to its original forecasts. Management noted that the forecasts as revised as of June 30, 2018 for the Salix reporting unit did not result in cash flows materially different than those used in management's January 1, 2018 testing and the difference in the forecasts would not change the conclusion of the Company’s goodwill impairment testing as of January 1, 2018. The Company also considered the sensitivity of its conclusions as they relate to changes in the estimates and assumptions. Based on its qualitative assessments, management believes that the carrying value of the Salix reporting unit did not exceed its fair value as of June 30, 2018. During the three months ended June 30, 2018, unforeseen changes in the business dynamics of the Ortho Dermatologics reporting unit, such as changes in the dermatology sector, additional risks to the exclusivity of certain products and a longer than originally expected launch cycle for a certain product, were factors that negatively impacted the reporting unit's operating results beyond management's expectations as of January 1, 2018, when the Company performed its last goodwill impairment test. In response to these adverse business indicators, the Company performed a goodwill impairment test of the Ortho Dermatologics reporting unit. Based on the goodwill impairment test performed, the estimated fair value of the Ortho Dermatologics reporting unit exceeded its carrying value at the date of testing by approximately 5% and, therefore, there was no impairment to goodwill. If market conditions differ from the management's assumptions, the exclusivity of products are challenged successfully, or if the Company is unable to execute its strategies, including bringing its research and development projects to market as forecasted, it may be necessary to record impairment charges in the future. No other events occurred or circumstances changed during the period January 1, 2018 (the date goodwill was last tested for impairment for all reporting units other than the Ortho Dermatologics reporting unit) through June 30, 2018 that would indicate that the fair value of any reporting unit, other than the Salix and Ortho Dermatologics reporting units might be below its carrying value. Accumulated goodwill impairment charges through June 30, 2018 were $3,602 million . If market conditions deteriorate, or if the Company is unable to execute its strategies, it may be necessary to record impairment charges in the future. |
ACCRUED AND OTHER CURRENT LIABI
ACCRUED AND OTHER CURRENT LIABILITIES | 6 Months Ended |
Jun. 30, 2018 | |
Payables and Accruals [Abstract] | |
ACCRUED AND OTHER CURRENT LIABILITIES | ACCRUED AND OTHER CURRENT LIABILITIES Accrued and other current liabilities were as follows: (in millions) June 30, December 31, Product rebates $ 1,137 $ 1,094 Product returns 841 863 Interest 306 324 Employee compensation and benefit costs 237 259 Income taxes payable 186 202 Other 720 952 $ 3,427 $ 3,694 |
FINANCING ARRANGEMENTS
FINANCING ARRANGEMENTS | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
FINANCING ARRANGEMENTS | FINANCING ARRANGEMENTS Principal amounts of debt obligations and principal amounts of debt obligations net of discounts and issuance costs consists of the following: June 30, 2018 December 31, 2017 (in millions) Maturity Principal Amount Net of Discounts and Issuance Costs Principal Amount Net of Discounts and Issuance Costs Senior Secured Credit Facilities: 2018 Revolving Credit Facility April 2018 $ — $ — $ — $ — 2020 Revolving Credit Facility April 2020 — — 250 250 2023 Revolving Credit Facility June 2023 325 325 — — Series F Tranche B Term Loan Facility April 2022 — — 3,521 3,420 2025 Term Loan B Facility June 2025 4,565 4,426 — — Senior Secured Notes: 6.50% Secured Notes March 2022 1,250 1,237 1,250 1,235 7.00% Secured Notes March 2024 2,000 1,977 2,000 1,975 5.50% Secured Notes November 2025 1,750 1,729 1,750 1,729 Senior Unsecured Notes: 5.375% March 2020 — — 1,708 1,699 7.00% October 2020 — — 71 71 6.375% October 2020 — — 661 656 7.50% July 2021 1,625 1,617 1,625 1,615 6.75% August 2021 — — 650 648 5.625% December 2021 900 896 900 896 7.25% July 2022 — — 550 545 5.50% March 2023 1,000 994 1,000 993 5.875% May 2023 3,250 3,227 3,250 3,224 4.50% euro-denominated debt May 2023 1,750 1,737 1,801 1,787 6.125% April 2025 3,250 3,224 3,250 3,222 9.00% December 2025 1,500 1,466 1,500 1,464 9.25% April 2026 1,500 1,481 — — 8.50% January 2027 750 738 — — Other Various 14 14 15 15 Total long-term debt and other $ 25,429 25,088 $ 25,752 25,444 Less: Current portion of long-term debt and other 230 209 Non-current portion of long-term debt $ 24,858 $ 25,235 Covenant Compliance The Senior Secured Credit Facilities (as defined below) and the indentures governing the Company’s Senior Secured Notes and Senior Unsecured Notes contain customary affirmative and negative covenants and specified events of default. These affirmative and negative covenants include, among other things, and subject to certain qualifications and exceptions, covenants that restrict the Company’s ability and the ability of its subsidiaries to: incur or guarantee additional indebtedness; create or permit liens on assets; pay dividends on capital stock or redeem, repurchase or retire capital stock or subordinated indebtedness; make certain investments and other restricted payments; engage in mergers, acquisitions, consolidations and amalgamations; transfer and sell certain assets; and engage in transactions with affiliates. The 2023 Revolving Credit Facility also contains a financial maintenance covenant consisting of a first lien leverage ratio. As of June 30, 2018 , the Company was in compliance with its financial maintenance covenant related to its debt obligations. The Company, based on its current forecast for the next twelve months from the date of issuance of these financial statements, expects to remain in compliance with its financial maintenance covenant and meet its debt service obligations over that same period. The Company continues to take steps to improve its operating results to ensure continual compliance with its financial maintenance covenant and may take other actions to reduce its debt levels to align with the Company’s long term strategy, including divesting other businesses, refinancing debt and issuing equity or equity-linked securities as deemed appropriate. Senior Secured Credit Facilities On February 13, 2012, the Company and certain of its subsidiaries as guarantors entered into the “Senior Secured Credit Facilities” under the Company’s Third Amended and Restated Credit and Guaranty Agreement, as amended (the “Third Amended Credit Agreement”) with a syndicate of financial institutions and investors, as lenders. As of January 1, 2017, the Third Amended Credit Agreement provided for: (i) a $1,500 million Revolving Credit Facility maturing on April 20, 2018 (the "2018 Revolving Credit Facility"), which included a sublimit for the issuance of standby and commercial letters of credit and a sublimit for swing line loans and (ii) a series of term loans maturing during the years 2016 through 2022. On March 21, 2017, the Company entered into Amendment No. 14 to the Third Amended Credit Agreement (“Amendment No. 14”), which: (i) provided additional financing from an incremental term loan under the Company's Series F Tranche B Term Loan Facility of $3,060 million (the “Series F-3 Tranche B Term Loan Facility”), (ii) amended the financial covenants contained in the Third Amended Credit Agreement, (iii) increased the amortization rate for the Series F-3 Tranche B Term Loan Facility from 0.25% per quarter ( 1% per annum) to 1.25% per quarter ( 5% per annum), with quarterly repayments starting March 31, 2017, (iv) amended certain financial definitions, including the definition of Consolidated Adjusted EBITDA and (v) provided additional ability for the Company to, among other things, incur indebtedness and liens, consummate acquisitions and make other investments, including relaxing certain limitations imposed by prior amendments. The proceeds from the additional financing, combined with the proceeds from the issuance of the March 2022 Secured Notes (as they are defined below) and the March 2024 Secured Notes (as they are defined below) and cash on hand, were used to: (i) repay all outstanding balances under the Company’s Series A-3 Tranche A Term Loan Facility, Series A-4 Tranche A Term Loan Facility, Series D-2 Tranche B Term Loan Facility, Series C-2 Tranche B Term Loan Facility, and Series E-1 Tranche B Term Loan Facility (collectively the “March 2017 Refinanced Debt”), (ii) repurchase $1,100 million in principal amount of 6.75% Senior Unsecured Notes due August 2018 (the “ August 2018 Unsecured Notes ”), (iii) repay $350 million of amounts outstanding under the Company's 2018 Revolving Credit Facility and (iv) pay related fees and expenses (collectively, the “March 2017 Refinancing Transactions”). Amendment No. 14 was accounted for as a modification of debt to the extent the March 2017 Refinanced Debt was replaced with the incremental Series F-3 Tranche B Term Loan Facility issued to the same creditor and an extinguishment of debt to the extent the March 2017 Refinanced Debt was replaced with Series F-3 Tranche B Term Loan Facility issued to a different creditor. The March 2017 Refinanced Debt that was replaced with the proceeds of the newly issued Senior Secured Notes was accounted for as an extinguishment of debt. For amounts accounted for as an extinguishment of debt, the Company incurred a Loss on extinguishment of debt of $27 million representing the difference between the amount paid to settle the extinguished debt and the extinguished debt’s carrying value (the stated principal amount net of unamortized discount and debt issuance costs). Payments made to the lenders of $38 million associated with the issuance of the new Series F-3 Tranche B Term Loan Facility were capitalized and were being amortized as interest expense over the remaining term of the Series F-3 Tranche B Term Loan Facility. Third party expenses of $3 million associated with the modification of debt were expensed as incurred and included in Interest expense. On March 28, 2017, the Company entered into Amendment No. 15 to the Third Amended Credit Agreement (“Amendment No. 15”) which provided for the extension of the maturity date of $1,190 million of revolving credit commitments under the 2018 Revolving Credit Facility from April 20, 2018 to the earlier of: (i) April 20, 2020 and (ii) the date that was 91 calendar days prior to the scheduled maturity of any series or tranche of term loans under the Third Amended Credit Agreement, certain Senior Secured Notes or Senior Unsecured Notes and any other indebtedness for borrowed money in excess of $750 million (the "Extended Revolving Maturity Date", and these extended commitments comprising the “2020 Revolving Credit Facility”). Amendment No. 15 was accounted for, in part, as a debt modification, whereby the fees paid to lenders agreeing to extend their commitment through April 20, 2020 and the fees paid to lenders providing additional commitments were recognized as additional debt issuance costs and were being amortized over the remaining term of the 2020 Revolving Credit Facility. Amendment No. 15 was also accounted for, in part, as an extinguishment of debt and the Company incurred a Loss on extinguishment of debt of $1 million representing the unamortized debt issuance costs associated with the commitments canceled by lenders in the amendment. On April 19, 2018, the Company entered into Amendment No. 17 to the Third Amended Credit Agreement which provided for the extension of the maturity date of an additional $60 million of revolving credit commitments under the 2018 Revolving Credit Facility from April 20, 2018 to the Extended Revolving Maturity Date under the 2020 Revolving Credit Facility consistent with the terms of Amendment No. 15 outlined above. The remaining $250 million of revolving credit commitments under the 2018 Revolving Credit Facility matured on April 20, 2018. In April 2017, using the net proceeds from the Skincare Sale and the proceeds from the divestiture of a manufacturing facility in Brazil, the Company repaid $220 million of its Series F Tranche B Term Loan Facility. On July 3, 2017, using the net proceeds from the Dendreon Sale, the Company repaid $811 million of its Series F Tranche B Term Loan Facility. On October 5, 2017, using the net proceeds from the iNova Sale, the Company repaid $923 million of its Series F Tranche B Term Loan Facility. On November 10, 2017, using the net proceeds from the Obagi Sale, the Company repaid $181 million of its Series F Tranche B Term Loan Facility. On November 21, 2017, using the proceeds from the November 2017 Refinancing Transactions (as defined below), the Company repaid $750 million of its Series F Tranche B Term Loan Facility. On November 21, 2017, the Company entered into Amendment No. 16 to the Third Amended Credit Agreement (“Amendment No. 16”) to reprice the Series F Tranche B Term Loan Facility. The applicable margins for borrowings under the Series F Tranche B Term Loan Facility, as modified by the repricing, were 2.50% with respect to base rate borrowings and 3.50% with respect to LIBO rate borrowings. Amendment No. 16 also increased the letter of credit facility sublimit under the Third Amended Credit Agreement to $300 million and made certain other amendments to provide the Company with additional flexibility to enter into certain cash management transactions. On June 1, 2018, the Company entered into a Restatement Agreement in respect of a Fourth Amended and Restated Credit and Guaranty Agreement (the “Restated Credit Agreement”). The Restated Credit Agreement amended and restated in full the Third Amended Credit Agreement. The Restated Credit Agreement replaced the 2020 Revolving Credit Facility with a revolving credit facility of $1,225 million (the "2023 Revolving Credit Facility") and replaced the Series F Tranche B Term Loan Facility principal amount outstanding of $3,315 million with the seven year Tranche B Term Loan Facility of $4,565 million (the “2025 Term Loan B Facility”) borrowed by the Company’s subsidiary, Valeant Pharmaceuticals International (“VPI”). The 2023 Revolving Credit Facility matures on the earlier of June 1, 2023 and the date that is 91 calendar days prior to the scheduled maturity of indebtedness for borrowed money of the Company or VPI in an aggregate principal amount in excess of $1,000 million. Both the Company and VPI are borrowers with respect to the 2023 Revolving Credit Facility. Borrowings under the 2023 Revolving Credit Facility may be made in U.S. dollars, Canadian dollars or euros. On June 1, 2018, the Company issued an irrevocable notice of redemption for the remaining outstanding principal amounts of: (i) $691 million of 5.375% Senior Unsecured Notes due 2020 (the "March 2020 Unsecured Notes"), (ii) $578 million of 6.75% Senior Unsecured Notes due 2021(the "August 2021 Unsecured Notes"), (iii) $550 million of 7.25% Senior Unsecured Notes due 2022 (the “July 2022 Unsecured Notes”) and (iv) $146 million of 6.375% Senior Unsecured Notes due 2020 (the “ 6.375% October 2020 Unsecured Notes” and together with the March 2020 Unsecured Notes, August 2021 Unsecured Notes and July 2022 Unsecured Notes the “June 2018 Unsecured Refinanced Debt”). On June 1, 2018, using the remaining net proceeds from the 2025 Term Loan B Facility, the net proceeds from the issuance of $750 million in aggregate principal amount of 8.50% Senior Unsecured Notes due 2027 (the "January 2027 Unsecured Notes") by VPI and cash on hand, the Company prepaid the remaining Series F Tranche B Term Loan Facility and deposited sufficient funds with The Bank of New York Mellon Trust Company, N.A., as trustee under the indentures governing the June 2018 Unsecured Refinanced Debt, to redeem the June 2018 Unsecured Refinanced Debt at their aggregate redemption price and the indentures governing the June 2018 Unsecured Refinanced Debt were discharged (collectively, the “June 2018 Refinancing Transactions”). The Restated Credit Agreement was accounted for as a modification of debt, to the extent the June 2018 Unsecured Refinanced Debt was replaced with newly issued debt to the same creditor, and as an extinguishment of debt if: (i) the June 2018 Unsecured Refinanced Debt was replaced with newly issued debt to a different creditor, (ii) a portion of the unamortized deferred financing fees are allocated to debt that was paid down or (iii) the borrowing capacity declined when issuing a new revolving credit facility. The following was accounted for as an extinguishment of debt: (i) the difference between the amounts paid to redeem the June 2018 Unsecured Refinanced Debt and the June 2018 Unsecured Refinanced Debt’s carrying value, (ii) the replacement of the Series F Tranche B Term Loan with the 2025 Term Loan B Facility to the extent any unamortized deferred financing fees were associated to the portion of the Series F Tranche B Term Loan that was paid down and (iii) the replacement of the 2020 Revolving Credit Facility with the 2023 Revolving Credit Facility to the extent any unamortized deferred financing fees were associated with the decline in borrowing capacity. For amounts accounted for as an extinguishment of debt, the Company incurred a Loss on extinguishment of debt of $48 million . Payments made to the lenders and a portion of payments made to third parties of $74 million associated with the June 2018 Refinancing Transactions were capitalized and are being amortized as interest expense over the remaining term of the 2025 Term Loan B Facility. Third party expenses of $4 million associated with the modification of debt were expensed as incurred and included in Interest expense. As of June 30, 2018 , the Company had $325 million of outstanding borrowings, $169 million of issued and outstanding letters of credit, and remaining availability of $731 million under its 2023 Revolving Credit Facility. Current Description of Senior Secured Credit Facilities Borrowings under the Senior Secured Credit Facilities in U.S. dollars bear interest at a rate per annum equal to, at the Company's option, either: (i) a base rate determined by reference to the higher of: (a) the prime rate (as defined in the Restated Credit Agreement), (b) the federal funds effective rate plus 1/2 of 1.00% or (c) the eurocurrency rate (as defined in the Restated Credit Agreement) for a period of one month plus 1.00% (or if such eurocurrency rate shall not be ascertainable, 1.00% ) or (ii) a eurocurrency rate determined by reference to the costs of funds for U.S. dollar deposits for the interest period relevant to such borrowing adjusted for certain additional costs (provided however, that the eurocurrency rate shall at no time be less than zero), in each case plus an applicable margin. Borrowings under the 2023 Revolving Credit Facility in Euros bear interest at a eurocurrency rate determined by reference to the costs of funds for Euro deposits for the interest period relevant to such borrowing (provided however, that the eurocurrency rate shall at no time be less than 0.00% per annum), plus an applicable margin. Borrowings under the 2023 Revolving Credit Facility in Canadian dollars bear interest at a rate per annum equal to, at the Company's option, either (a) a prime rate determined by reference to the higher of (1) the rate of interest last quoted by The Wall Street Journal as the “Canadian Prime Rate” or, if The Wall Street Journal ceases to quote such rate, the highest per annum interest rate published by the Bank of Canada as its prime rate and (2) the 1 month BA rate (as defined below) calculated daily plus 1.00% (provided however, that the prime rate shall at no time be less than 0.00% ) or (b) the bankers’ acceptance rate for Canadian dollar deposits in the Toronto interbank market (the “BA rate”) for the interest period relevant to such borrowing (provided however, that the BA rate shall at no time be less than 0.00% per annum), in each case plus an applicable margin. Subject to certain exceptions and customary baskets set forth in the Restated Credit Agreement, the Company is required to make mandatory prepayments of the loans under the Senior Secured Credit Facilities under certain circumstances, including from: (i) 100% of the net cash proceeds of insurance and condemnation proceeds for property or asset losses (subject to reinvestment rights and net proceeds threshold), (ii) 100% of the net cash proceeds from the incurrence of debt (other than permitted debt as described in the Restated Credit Agreement), (iii) 50% of Consolidated Excess Cash Flow (as defined in the Restated Credit Agreement) subject to decrease based on leverage ratios and subject to a threshold amount and (iv) 100% of net cash proceeds from asset sales (subject to reinvestment rights). These mandatory prepayments may be used to satisfy future amortization. The applicable interest rate margins for the 2025 Term Loan B Facility are 2.00% with respect to base rate borrowings and 3.00% with respect to eurocurrency rate borrowings. As of June 30, 2018 , the stated rate of interest on the Company’s borrowings under the 2025 Term Loan B Facility was 4.98% per annum. The amortization rate for the 2025 Term Loan B Facility is 5.00% per annum. The Company may direct that prepayments be applied to such amortization payments in order of maturity. As of June 30, 2018 , the remaining mandatory quarterly amortization payments for the Senior Secured Credit Facilities were $1,541 million through June 1, 2025. The applicable interest rate margins for borrowings under the 2023 Revolving Credit Facility are 1.50% - 2.00% with respect to base rate borrowings and 2.50% - 3.00% with respect to eurocurrency rate borrowings. As of June 30, 2018 , the stated rate of interest on the 2023 Revolving Credit Facility was 4.98% per annum. In addition, the Company is required to pay commitment fees of 0.25% - 0.50% per annum with respect to the unutilized commitments under the 2023 Revolving Credit Facility, payable quarterly in arrears. The Company also is required to pay: (i) letter of credit fees on the maximum amount available to be drawn under all outstanding letters of credit in an amount equal to the applicable margin on eurocurrency rate borrowings under the 2023 Revolving Credit Facility on a per annum basis, payable quarterly in arrears, (ii) customary fronting fees for the issuance of letters of credit and (iii) agency fees. The 2023 Revolving Credit Facility includes a financial maintenance covenant that requires the Company to maintain a first lien net leverage ratio of not greater than 4.00 :1.00. The financial maintenance covenant may be waived or amended without the consent of the term loan facility lenders and contains a customary term loan facility standstill. The Restated Credit Agreement permits the incurrence of $1,000 million of incremental credit facility borrowings, subject to customary terms and conditions, as well as the incurrence of additional incremental credit facility borrowings subject to, in the case of secured debt, a secured leverage ratio of not greater than 3.50 :1.00, and, in the case of unsecured debt, a total leverage ratio of not greater than 6.50 :1.00 or an interest coverage ratio of not less than 2.00 :1.00. Senior Secured Notes The Senior Secured Notes are guaranteed by each of the Company’s subsidiaries that is a guarantor under the Restated Credit Agreement and existing Senior Unsecured Notes (together, the “Note Guarantors”). The Senior Secured Notes and the guarantees related thereto are senior obligations and are secured, subject to permitted liens and certain other exceptions, by the same first priority liens that secure the Company’s obligations under the Restated Credit Agreement under the terms of the indenture governing the Senior Secured Notes. The Senior Secured Notes and the guarantees rank equally in right of repayment with all of the Company’s and Note Guarantors’ respective existing and future unsubordinated indebtedness and senior to the Company’s and Note Guarantors’ respective future subordinated indebtedness. The Senior Secured Notes and the guarantees related thereto are effectively pari passu with the Company’s and the Note Guarantors’ respective existing and future indebtedness secured by a first priority lien on the collateral securing the Senior Secured Notes and effectively senior to the Company’s and the Note Guarantors’ respective existing and future indebtedness that is unsecured, including the existing Senior Unsecured Notes, or that is secured by junior liens, in each case to the extent of the value of the collateral. In addition, the Senior Secured Notes are structurally subordinated to: (i) all liabilities of any of the Company’s subsidiaries that do not guarantee the Senior Secured Notes and (ii) any of the Company’s debt that is secured by assets that are not collateral. Upon the occurrence of a change in control (as defined in the indentures governing the Senior Secured Notes), unless the Company has exercised its right to redeem all of the notes of a series, holders of the Senior Secured Notes may require the Company to repurchase such holder’s notes, in whole or in part, at a purchase price equal to 101% of the principal amount thereof plus accrued and unpaid interest. 6.50% Senior Secured Notes due 2022 and 7.00% Senior Secured Notes due 2024 - March 2017 Refinancing Transactions As part of the March 2017 Refinancing Transactions, the Company issued $1,250 million aggregate principal amount of 6.50% senior secured notes due March 15, 2022 (the “ March 2022 Secured Notes ”) and $2,000 million aggregate principal amount of 7.00% senior secured notes due March 15, 2024 (the “ March 2024 Secured Notes ”), in a private placement, the proceeds of which, when combined with the proceeds from the Series F-3 Tranche B Term Loan Facility and cash on hand, were used to: (i) repay the March 2017 Refinanced Debt, (ii) repurchase $1,100 million in principal amount of August 2018 Senior Unsecured Notes, (iii) repay $350 million of amounts outstanding under the Company's 2018 Revolving Credit Facility and (iv) pay related fees and expenses. Interest on these notes is payable semi-annually in arrears on each March 15 and September 15. 5.50% Senior Secured Notes due 2025 - October 2017 Refinancing Transactions and November 2017 Refinancing Transactions On October 17, 2017, the Company issued $1,000 million aggregate principal amount of 5.50% Senior Secured Notes due November 2025 (the “ November 2025 Secured Notes ”) in a private placement, the proceeds of which were used to: (i) repurchase $569 million in principal amount of the 6.375% October 2020 Unsecured Notes and (ii) repurchase $431 million in principal amount of the 7.00% Senior Unsecured Notes due 2020 (the " 7.00% October 2020 Unsecured Notes") (collectively, the “October 2017 Refinancing Transactions”). The related fees and expenses were paid using cash on hand. Interest on the November 2025 Secured Notes is payable semi-annually in arrears on each May 1 and November 1. On November 21, 2017, the Company issued $750 million aggregate principal amount of the November 2025 Secured Notes in a private placement. These are additional notes and form part of the same series as the Company’s existing November 2025 Secured Notes . The proceeds were used to prepay $750 million of its Series F Tranche B Term Loan Facility. The related fees and expenses were paid using cash on hand (collectively, the “November 2017 Refinancing Transactions”). Senior Unsecured Notes The Senior Unsecured Notes issued by the Company are the Company’s senior unsecured obligations and are jointly and severally guaranteed on a senior unsecured basis by each of its subsidiaries that is a guarantor under the Senior Secured Credit Facilities. The Senior Unsecured Notes issued by VPI are senior unsecured obligations of VPI and are jointly and severally guaranteed on a senior unsecured basis by the Company and each of its subsidiaries (other than VPI) that is a guarantor under the Senior Secured Credit Facilities. Future subsidiaries of the Company and VPI, if any, may be required to guarantee the Senior Unsecured Notes. If the Company experiences a change in control, the Company may be required to make an offer to repurchase each series of Senior Unsecured Notes, in whole or in part, at a purchase price equal to 101% of the aggregate principal amount of the Senior Unsecured Notes repurchased, plus accrued and unpaid interest. 6.75% Senior Unsecured Notes due 2018 In addition to the repurchase of $1,100 million of August 2018 Unsecured Notes as part of the March 2017 Refinancing Transactions, on August 15, 2017, the Company repurchased the remaining $500 million of outstanding August 2018 Unsecured Notes using cash on hand, plus accrued and unpaid interest. 9.00% Senior Unsecured Notes due 2025 - December 2017 Refinancing Transactions On December 18, 2017, the Company issued $1,500 million aggregate principal amount of 9.00% Senior Unsecured Notes due 2025 (the “ December 2025 Unsecured Notes ”) in a private placement, the proceeds of which were used to: (i) repurchase $1,021 million in principal amount of the 6.375% October 2020 Unsecured Notes, (ii) repurchase $291 million in principal amount of the March 2020 Unsecured Notes and (iii) repurchase $188 million in principal amount of the 7.00% October 2020 Unsecured Notes (collectively, the “December 2017 Refinancing Transactions”). The related fees and expenses were paid using cash on hand. The December 2025 Unsecured Notes accrue interest at the rate of 9.00% per year, payable semi-annually in arrears on each of June 15 and December 15. 9.25% Senior Unsecured Notes due 2026 - March 2018 Refinancing Transactions On March 26, 2018, VPI issued $1,500 million in aggregate principal amount of 9.25% Senior Unsecured Notes due 2026 (the “April 2026 Unsecured Notes”) in a private placement, the proceeds of which were used to repurchase $1,500 million in aggregate principal amount of unsecured notes which consisted of: (i) $1,017 million in principal amount of the March 2020 Unsecured Notes, (ii) $411 million in principal amount of the 6.375% October 2020 Unsecured Notes and (iii) $72 million in principal amount of the August 2021 Unsecured Notes. All fees and expenses associated with these transactions were paid with cash on hand (collectively, the “March 2018 Refinancing Transactions”). During the three months ended June 30, 2018 , VPI redeemed an additional $104 million in principal amount of 6.375% October 2020 Unsecured Notes using cash on hand. The April 2026 Unsecured Notes accrue interest at the rate of 9.25% per year, payable semi-annually in arrears on each of April 1 and October 1. VPI may redeem all or a portion of the April 2026 Unsecured Notes at any time prior to April 1, 2022, at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of redemption, plus a “make-whole” premium. In addition, at any time prior to April 1, 2021, VPI may redeem up to 40% of the aggregate principal amount of the outstanding April 2026 Unsecured Notes with the net proceeds of certain equity offerings at the redemption price set forth in the April 2026 Unsecured Notes indenture. On or after April 1, 2022, VPI may redeem all or a portion of the April 2026 Unsecured Notes at the applicable redemption prices set forth in the April 2026 Unsecured Notes indenture, plus accrued and unpaid interest to the date of redemption. 8.50% Senior Unsecured Notes due 2027 - June 2018 Refinancing Transactions As part of the June 2018 Refinancing Transactions, VPI issued $750 million in aggregate principal amount of January 2027 Unsecured Notes in a private placement, the proceeds of which, when combined with the remaining net proceeds from the 2025 Term Loan B Facility and cash on hand, were deposited with The Bank of New York Mellon Trust Company, N.A., as trustee under the indentures governing the June 2018 Unsecured Refinanced Debt, to redeem the June 2018 Unsecured Refinanced Debt at their aggregate redemption price and the indentures governing the June 2018 Unsecured Refinanced Debt were discharged. The January 2027 Unsecured Notes accrue interest at the rate of 8.50% per year, payable semi-annually in arrears on each of January 31 and July 31. VPI may redeem all or a portion of the January 2027 Unsecured Notes at any time prior to July 31, 2022, at a price equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of redemption, plus a “make-whole” premium. In addition, at any time prior to July 31, 2021, VPI may redeem up to 40% of the aggregate principal amount of the outstanding January 2027 Unsecured Notes with the net proceeds of certain equity offerings at the redemption price set forth in the January 2027 Unsecured Notes indenture. On or after July 31, 2022, VPI may redeem all or a portion of the January 2027 Unsecured Notes at the applicable redemption prices set forth in the January 2027 Unsecured Notes indenture, plus accrued and unpaid interest to the date of redemption. Weighted Average Stated Rate of Interest The weighted average stated rate of interest for the Company's outstanding debt obligations as of June 30, 2018 and December 31, 2017 was 6.28% and 6.07% , respectively. Maturities Maturities and mandatory amortization payments of debt obligations for the period July through December 2018 , the five succeeding years ending December 31 and thereafter are as follows: (in millions) July through December 2018 $ 114 2019 230 2020 228 2021 2,753 2022 1,478 2023 6,553 Thereafter 14,073 Total gross maturities 25,429 Unamortized discounts (341 ) Total long-term debt and other $ 25,088 |
PENSION AND POSTRETIREMENT EMPL
PENSION AND POSTRETIREMENT EMPLOYEE BENEFIT PLANS | 6 Months Ended |
Jun. 30, 2018 | |
Retirement Benefits [Abstract] | |
PENSION AND POSTRETIREMENT EMPLOYEE BENEFIT PLANS | PENSION AND POSTRETIREMENT EMPLOYEE BENEFIT PLANS The Company sponsors defined benefit plans and a participatory defined benefit postretirement medical and life insurance plan, which covers certain U.S. employees and employees in certain other countries. The following table provides the components of net periodic (benefit) cost for the Company’s defined benefit pension plans and postretirement benefit plan for the three and six months ended June 30, 2018 and 2017 : Pension Benefit Plans Postretirement Benefit Plan U.S. Plan Non-U.S. Plans Three Months Ended June 30, (in millions) 2018 2017 2018 2017 2018 2017 Service cost $ 1 $ — $ — $ 1 $ — $ — Interest cost 1 2 2 1 — — Expected return on plan assets (3 ) (3 ) (2 ) (1 ) — — Amortization of prior service credit — — — (1 ) (1 ) (1 ) Amortization of net loss — — — 1 — — Net periodic (benefit) cost $ (1 ) $ (1 ) $ — $ 1 $ (1 ) $ (1 ) Pension Benefit Plans Postretirement U.S. Plan Non-U.S. Plans Six Months Ended June 30, (in millions) 2018 2017 2018 2017 2018 2017 Service cost $ 1 $ 1 $ 1 $ 1 $ — $ — Interest cost 3 4 3 2 — 1 Expected return on plan assets (7 ) (6 ) (3 ) (2 ) — — Amortization of prior service credit — — — (1 ) (1 ) (2 ) Amortization of net loss — — — 1 — — Net periodic (benefit) cost $ (3 ) $ (1 ) $ 1 $ 1 $ (1 ) $ (1 ) During the six months ended June 30, 2018 , the Company contributed $2 million , $4 million , and $2 million to the U.S. pension benefit plans, the non-U.S. pension benefit plans, and the postretirement benefit plan, respectively. The Company expects to contribute $5 million , $7 million , and $6 million in 2018 to the U.S. pension benefit plans, the non-U.S. pension benefit plans, and the postretirement benefit plan, respectively, inclusive of amounts contributed during the six months ended June 30, 2018 . |
SHARE-BASED COMPENSATION
SHARE-BASED COMPENSATION | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION In May 2014, the shareholders approved the Company’s 2014 Omnibus Incentive Plan (the “2014 Plan”) which replaced the Company’s 2011 Omnibus Incentive Plan (the "2011 Plan") for future equity awards granted by the Company. The maximum number of common shares that may be issued to participants under the 2014 Plan is equal to 18,000,000 common shares, plus the number of common shares under the 2011 Plan reserved but unissued and not underlying outstanding awards and the number of common shares becoming available for reuse after awards are terminated, forfeited, cancelled, exchanged or surrendered under the 2011 Plan and the Company’s 2007 Equity Compensation Plan. The Company registered, in the aggregate, 20,000,000 common shares of common stock for issuance under the 2014 Plan. Effective April 30, 2018, the Company amended and restated its 2014 Omnibus Incentive Plan (the “Amended and Restated 2014 Plan”). The Amended and Restated 2014 Plan includes the following amendments: (i) the number of common shares authorized for issuance under the Amended and Restated 2014 Plan has been increased by an additional 11,900,000 common shares, as approved by the requisite number of shareholders at the Company’s annual general meeting held on April 30, 2018, (ii) introduction of a $750,000 aggregate fair market value limit on awards (in either equity, cash or other compensation) that can be granted in any calendar year to a participant who is a non-employee director; (iii) housekeeping changes to address recent changes to Section 162(m) of the Internal Revenue Code; (iv) awards are expressly subject to the Company’s clawback policy; and (v) awards not assumed or substituted in connection with a Change of Control (as defined in the Amended and Restated 2014 Plan) will only vest on a pro rata basis. Approximately 14,054,000 common shares were available for future grants as of June 30, 2018 . The Company uses reserved and unissued common shares to satisfy its obligations under its share-based compensation plans. During the three months ended March 31, 2017, the Company introduced a new long-term incentive program with the objective to re-align the share-based awards granted to senior management with the Company’s focus on improving its tangible capital usage and allocation while maintaining focus on improving total shareholder return over the long-term. The share-based awards granted under this long-term incentive program consist of time-based stock options, time-based restricted share units (“RSUs”) and performance-based RSUs. Performance-based RSUs are comprised of awards that vest upon achievement of certain share price appreciation conditions that are based on total shareholder return (“TSR”) and awards that vest upon attainment of certain performance targets that are based on the Company’s return on tangible capital (“ROTC”). The following table summarizes the components and classification of share-based compensation expense related to stock options and RSUs for the three and six months ended June 30, 2018 and 2017 : Three Months Ended Six Months Ended (in millions) 2018 2017 2018 2017 Stock options $ 6 $ 5 $ 11 $ 10 RSUs 16 18 32 41 $ 22 $ 23 $ 43 $ 51 Research and development expenses $ 2 $ 2 $ 4 $ 4 Selling, general and administrative expenses 20 21 39 47 $ 22 $ 23 $ 43 $ 51 During the six months ended June 30, 2018 and 2017 , the Company granted approximately 2,076,000 stock options with a weighted-average exercise price of $15.35 per option and approximately 1,525,000 stock options with a weighted-average exercise price of $14.27 per option, respectively. The weighted-average fair values of all stock options granted to employees during the six months ended June 30, 2018 and 2017 were $7.82 and $5.99 , respectively. During the six months ended June 30, 2018 and 2017 , the Company granted approximately 2,726,000 time-based RSUs with a weighted-average grant date fair value of $17.07 per RSU and approximately 3,425,000 time-based RSUs with a weighted-average grant date fair value of $11.68 per RSU, respectively. During the six months ended June 30, 2018 and 2017 , the Company granted approximately 878,000 and 416,000 performance-based RSUs, consisting of approximately 469,000 and 208,000 units of TSR performance-based RSUs with an average grant date fair value of $29.35 and $16.34 per RSU and approximately 409,000 and 208,000 units of ROTC performance-based RSUs with a weighted-average grant date fair value of $18.80 and $15.76 per RSU, respectively. The granted stock options, time-based RSUs and performance-based RSUs includes long-term incentive awards granted to the Company’s Chief Executive Officer ("CEO") during the three months ended March 31, 2018, which had an aggregate value of $10 million . In connection with his award, approximately 933,000 performance-based RSUs received by the CEO upon his hire in 2016 were cancelled, and the shares underlying those performance-based RSUs were permanently retired and are not available for future grants under the Amended and Restated 2014 Plan. The CEO's long-term incentive award is accounted for as an award modification whereby the Company continues to recognize the unamortized compensation associated with the original award plus the incremental fair value of the new award measured at the date of grant, over the vesting period of the new award. As of June 30, 2018 , the remaining unrecognized compensation expense related to all outstanding non-vested stock options, time-based RSUs and performance-based RSUs amounted to $131 million , which will be amortized over a weighted-average period of 2.11 years. |
ACCUMULATED OTHER COMPREHENSIVE
ACCUMULATED OTHER COMPREHENSIVE LOSS | 6 Months Ended |
Jun. 30, 2018 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | ACCUMULATED OTHER COMPREHENSIVE LOSS The components of accumulated other comprehensive loss were as follows: (in millions) June 30, December 31, Foreign currency translation adjustments $ (2,048 ) $ (1,877 ) Pension and postretirement benefit plan adjustments, net of tax (20 ) (19 ) $ (2,068 ) $ (1,896 ) Income taxes are not provided for foreign currency translation adjustments arising on the translation of the Company’s operations having a functional currency other than the U.S. dollar, except to the extent of translation adjustments related to the Company’s retained earnings for foreign jurisdictions in which the Company is not considered to be permanently reinvested. |
RESEARCH AND DEVELOPMENT
RESEARCH AND DEVELOPMENT | 6 Months Ended |
Jun. 30, 2018 | |
Research and Development [Abstract] | |
RESEARCH AND DEVELOPMENT | RESEARCH AND DEVELOPMENT Included in Research and development are costs related to product development and quality assurance programs. Quality assurance are the costs incurred to meet evolving customer and regulatory standards. Research and development costs are as follows: Three Months Ended Six Months Ended (in millions) 2018 2017 2018 2017 Product related research and development $ 84 $ 86 $ 167 $ 172 Quality assurance 10 8 19 18 $ 94 $ 94 $ 186 $ 190 |
OTHER EXPENSE (INCOME), NET
OTHER EXPENSE (INCOME), NET | 6 Months Ended |
Jun. 30, 2018 | |
Other Income and Expenses [Abstract] | |
OTHER EXPENSE (INCOME), NET | OTHER EXPENSE (INCOME), NET Other expense (income), net were as follows: Three Months Ended Six Months Ended (in millions) 2018 2017 2018 2017 Gain on the Skincare Sale (Note 4) $ — $ — $ — $ (319 ) Gain on the Dendreon Sale (Note 4) — (73 ) — (73 ) Net loss on other sales of assets — 23 — 25 Litigation and other matters (1 ) 33 10 109 Other, net 1 (2 ) 1 (1 ) $ — $ (19 ) $ 11 $ (259 ) Litigation and other matters includes amounts provided for certain matters discussed in Note 18, "LEGAL PROCEEDINGS". |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES For interim financial statement purposes, U.S. GAAP income tax expense/benefit related to ordinary income is determined by applying an estimated annual effective income tax rate against the Company's ordinary income. Income tax expense/benefit related to items not characterized as ordinary income is recognized as a discrete item when incurred. The estimation of the Company's annual effective income tax rate requires the use of management forecasts and other estimates, a projection of jurisdictional taxable income and losses, application of statutory income tax rates, and an evaluation of valuation allowances. The estimate of tax expense in 2018 includes an estimate of the effects of the U.S. Tax Cuts and Jobs Act (the “Tax Act”) including both GILTI and BEAT (further discussed below). The Company's estimated annual effective income tax rate may be revised, if necessary, in each interim period. Provision for income taxes for the six months ended June 30, 2018 was $23 million and included: (i) $170 million of income tax benefit for the Company's ordinary loss during the six months ended June 30, 2018 and (ii) $193 million of net income tax expense for discrete items. The net income tax expense for discrete items includes: (i) $255 million of tax charges related to internal restructurings, (ii) a $57 million tax benefit related to the impairment of intangible assets and (iii) $10 million of tax benefits associated with the filing of tax returns for various tax jurisdictions. Benefit from income taxes for the six months ended June 30, 2017 was $1,129 million and included: (i) $155 million of income tax benefit for the Company's ordinary loss for the six months ended June 30, 2017 and (ii) $974 million of net income tax benefit for discrete items. The net income tax benefit for discrete items includes: (i) a $1,863 million benefit related to for the establishment of a deferred tax asset on the outside basis difference between members of the Company’s U.S. consolidated tax group that is expected to be realized, (ii) a $635 million charge for the impact of internal restructuring transactions, (iii) a $234 million charge for the Company’s divestitures and (iv) a benefit relating to the litigation matters accrual recorded during the six months ended June 30, 2017 . The Company records a valuation allowance against its deferred tax assets to reduce the net carrying value to an amount that it believes is more likely than not to be realized. When the Company establishes or reduces the valuation allowance against its deferred tax assets, the provision for income taxes will increase or decrease, respectively, in the period such determination is made except that, as a result of the 2018 adoption of guidance regarding intra-entity transfers, any change in valuation allowance surrounding the intra-entity transfer is recorded within equity. The valuation allowance against deferred tax assets was $2,376 million and $2,001 million as of June 30, 2018 and December 31, 2017 , respectively. The increase was due to continued losses in Canada and the Company's internal restructuring efforts recorded discretely. The Company will continue to assess the need for a valuation allowance on a go-forward basis. As of June 30, 2018 and December 31, 2017 , the Company had $607 million and $598 million of unrecognized tax benefits, which included $43 million and $41 million of interest and penalties, respectively. Of the total unrecognized tax benefits as of June 30, 2018 , $271 million would reduce the Company’s effective tax rate, if recognized. The Company anticipates that unrecognized tax benefits resolved within the next 12 months will not be material. On December 22, 2017, the Tax Act was signed into law and includes a number of changes in the U.S. tax law, most notably a reduction of the U.S. corporate income tax rate from 35% to 21% for tax years beginning after December 31, 2017. The Tax Act also implements a modified territorial tax system that includes a one-time transition tax on the accumulated previously untaxed earnings of foreign subsidiaries (the “Transition Toll Tax”) equal to 15.5% (reinvested in liquid assets) or 8% (reinvested in non-liquid assets). At the taxpayer's election, the Transition Toll Tax can be paid over an eight-year period without interest, starting in 2018. The Tax Act also includes two new U.S. tax base erosion provisions: (i) the base-erosion and anti-abuse tax (“BEAT”) and (ii) the global intangible low-taxed income (“GILTI”). BEAT provides a minimum tax on U.S. tax deductible payments made to related foreign parties after December 31, 2017. GILTI requires an entity to include in its U.S. taxable income the earnings of its foreign subsidiaries in excess of an allowable return on each foreign subsidiary’s depreciable tangible assets. Accounting guidance provides that the impacts of this provision can be included in the consolidated financial statements either by recording the impacts in the period in which GILTI has been incurred or by adjusting deferred tax assets or liabilities in the period of enactment related to basis differences expected to reverse as a result of the GILTI provisions in future years. The Company has provisionally elected to provide for the GILTI tax in the period in which it is incurred and, therefore, the 2017 benefit for income taxes did not include a provision for GILTI. The estimate of tax expense in 2018 includes an estimate of the effects of the Tax Act including both GILTI and BEAT. As part of the Tax Act, the Company’s U.S. interest expense is subject to limitation rules which limit U.S. interest expense to 30% of adjusted taxable income, defined similar to EBITDA (through 2021) and then EBIT thereafter. Disallowed interest can be carried forward indefinitely and any unused interest deduction assessed for recoverability. The Company considered such provisions in the 2018 annual estimated effective rate assessment and expects to fully utilize any interest carry forwards in future periods. The Company has provided for income taxes, including the impacts of the Tax Act, in accordance with the accounting guidance issued through the date of the issuance of these consolidated financial statements. In accordance with accounting guidance, the Company has provisionally provided for the income tax effects of the Tax Act as of December 31, 2017 and will finalize the provisional amounts associated with the Tax Act within one year of its enactment, December 22, 2018. The Company’s income tax benefit for the year 2017 included provisional net tax benefits of $975 million attributable to the Tax Act which included: (i) the re-measurement of certain deferred tax assets and liabilities based on the rates at which they are expected to reverse in the future of $774 million , (ii) the one-time Transition Toll Tax of $88 million and (iii) the decrease in deferred tax assets attributable to certain legal accruals, the deductibility of which is uncertain for U.S. federal income tax purposes, of $10 million . The Company has provisionally utilized net operating losses (“NOLs”) to offset the provisionally determined $88 million Transition Toll Tax and therefore no amount is recorded as payable. The Company has previously provided for residual U.S. federal income tax on its outside basis differences in certain foreign subsidiaries; however, as the Company's residual U.S. federal tax liability was $299 million prior to the law change, the Company recognized a deferred tax benefit of $299 million in the fourth quarter of 2017. The provisional amounts included in the Company's Benefit from income taxes for the year 2017, including the Transition Toll Tax, will be finalized as regulations and other guidance are published. The Company continually updates the provisional amounts based upon recently issued guidance by accounting regulatory bodies, the U.S. Internal Revenue Service and state and local governments. Although its assessment is still in progress, through the date of issuance of these financial statements, the Company has not identified any material revisions to the provisional amounts provided in the Company's Benefit from income taxes for the year 2017. As part of its full assessment, the Company will assess the impact of the Tax Act on the Company’s tax filings for the year 2017 which are expected to be completed during the fourth quarter of the current year. Differences between the provisional benefit from income taxes as provided in 2017 and the benefit or provision for income taxes when those provisional amounts are finalized in 2018 can be expected, particularly as it relates to the Company’s ultimate election to provide for the GILTI tax as discussed above, and those differences could be material. On August 1, 2018, the Treasury department released proposed regulations regarding the one-time Transition Toll Tax on the pre-2018 earnings of certain non-U.S. subsidiaries. The Company is evaluating the impact of the proposed regulations as part of its overall analysis of the impacts of the Tax Act. The Company continues to be under examination by the Canada Revenue Agency. The Company’s position with regard to proposed audit adjustments has not changed as of June 30, 2018 and the total proposed adjustment continues to result in a loss of tax attributes which are subject to a full valuation allowance. The Internal Revenue Service completed its examinations of the Company’s U.S. consolidated federal income tax returns for the years 2013 and 2014. There were no material adjustments to the Company's taxable income as a result of these examinations. The Company has filed tax returns which used a capital loss generated in 2017 to offset capital gains generated in 2014. As these tax returns were filed subsequent to the commencement of the examination by the Internal Revenue Service, the Company’s 2014 tax year cannot be closed commensurate with the examination’s conclusion. Additionally, the Internal Revenue Service has selected for examination the Company's annual tax filings for 2015 and 2016 and the Company's short period tax return for the period ended September 8, 2017, which was filed as a result of the Company's internal restructuring efforts during 2017. At this time, the Company does not expect that proposed adjustments, if any, for these periods would be material to the Company's consolidated financial statements. The Company's U.S. affiliates remain under examination for various state tax audits in the U.S. for years 2002 to 2016. The Company’s subsidiaries in Australia are under audit by the Australian Tax Office for various years beginning in 2010. On August 8, 2017, the Australian Taxation Office issued a notice of assessment for the tax years 2011 through 2017 in the aggregate amount of $117 million , which includes penalties and interest. The Company disagrees with the assessment and continues to believe that its tax positions are appropriate and supported by the facts, circumstances and applicable laws. The Company intends to defend its tax position in this matter vigorously and has filed a holding objection against the assessment by the Australian Taxation Office and has secured a bank guarantee to cover any potential cash outlays regarding this assessment. Certain affiliates of the Company in regions outside of Canada, the U.S. and Australia are currently under examination by relevant taxing authorities, and all necessary accruals have been recorded, including uncertain tax benefits. At this time, the Company does not expect that proposed adjustments, if any, would be material to the Company's consolidated financial statements. |
(LOSS) EARNINGS PER SHARE
(LOSS) EARNINGS PER SHARE | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
(LOSS) EARNINGS PER SHARE | (LOSS) EARNINGS PER SHARE (Loss) earnings per share attributable to Bausch Health Companies Inc. were calculated as follows: Three Months Ended Six Months Ended (in millions, except per share amounts) 2018 2017 2018 2017 Net (loss) income attributable to Bausch Health Companies Inc. $ (873 ) $ (38 ) $ (3,454 ) $ 590 Basic weighted-average number of common shares outstanding 351.3 350.1 351.0 350.0 Diluted effect of stock options, RSUs and other — — — 0.9 Diluted weighted-average number of common shares outstanding 351.3 350.1 351.0 350.9 (Loss) earnings per share attributable to Bausch Health Companies Inc.: Basic $ (2.49 ) $ (0.11 ) $ (9.84 ) $ 1.69 Diluted $ (2.49 ) $ (0.11 ) $ (9.84 ) $ 1.68 During the three and six months ended June 30, 2018 and three months ended June 30, 2017 , all potential common shares issuable for stock options and RSUs were excluded from the calculation of diluted loss per share, as the effect of including them would have been anti-dilutive. The dilutive effect of potential common shares issuable for stock options and RSUs on the weighted-average number of common shares outstanding would have been as follows: Three Months Ended Six Months Ended June 30, 2018 (in millions) 2018 2017 Basic weighted-average number of common shares outstanding 351.3 350.1 351.0 Diluted effect of stock options, RSUs and other 3.2 1.3 2.9 Diluted weighted-average number of common shares outstanding 354.5 351.4 353.9 During the three and six months ended June 30, 2018 , time-based RSUs, performance-based RSUs and stock options to purchase approximately 5,369,000 and 6,286,000 common shares, respectively, were not included in the computation of diluted earnings per share because the effect would have been anti-dilutive under the treasury stock method, compared with 8,655,000 common shares in both of the corresponding periods of 2017 . |
LEGAL PROCEEDINGS
LEGAL PROCEEDINGS | 6 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
LEGAL PROCEEDINGS | LEGAL PROCEEDINGS From time to time, the Company becomes involved in various legal and administrative proceedings, which include product liability, intellectual property, commercial, antitrust, governmental and regulatory investigations, related private litigation and ordinary course employment-related issues. From time to time, the Company also initiates actions or files counterclaims. The Company could be subject to counterclaims or other suits in response to actions it may initiate. The Company believes that the prosecution of these actions and counterclaims is important to preserve and protect the Company, its reputation and its assets. Certain of these proceedings and actions are described below. On a quarterly basis, the Company evaluates developments in legal proceedings, potential settlements and other matters that could increase or decrease the amount of the liability accrued. As of June 30, 2018 , the Company's consolidated balance sheet includes accrued current loss contingencies of $54 million related to matters which are both probable and reasonably estimable. For all other matters, unless otherwise indicated, the Company cannot reasonably predict the outcome of these legal proceedings, nor can it estimate the amount of loss, or range of loss, if any, that may result from these proceedings. An adverse outcome in certain of these proceedings could have a material adverse effect on the Company’s business, financial condition and results of operations, and could cause the market value of its common shares and/or debt securities to decline. Governmental and Regulatory Inquiries Investigation by the U.S. Attorney's Office for the District of Massachusetts In October 2015, the Company received a subpoena from the U.S. Attorney's Office for the District of Massachusetts, and, in June 2016, the Company received a follow up subpoena. The materials requested, pursuant to the subpoenas and follow-up requests, include documents and witness interviews with respect to the Company’s patient assistance programs and contributions to patient assistance organizations that provide financial assistance to Medicare patients taking products sold by the Company, and the Company’s pricing of its products. The Company is cooperating with this investigation. The Company cannot predict the outcome or the duration of this investigation or any other legal proceedings or any enforcement actions or other remedies that may be imposed on the Company arising out of this investigation. Investigation by the U.S. Attorney's Office for the Southern District of New York In October 2015, the Company received a subpoena from the U.S. Attorney's Office for the Southern District of New York. The materials requested, pursuant to the subpoena and follow-up requests, include documents and witness interviews with respect to the Company’s patient assistance programs; its former relationship with Philidor and other pharmacies; the Company’s accounting treatment for sales by specialty pharmacies; information provided to the Centers for Medicare and Medicaid Services; the Company’s pricing (including discounts and rebates), marketing and distribution of its products; the Company’s compliance program; and employee compensation. The Company is cooperating with this investigation. The Company cannot predict the outcome or the duration of this investigation or any other legal proceedings or any enforcement actions or other remedies that may be imposed on the Company arising out of this investigation. SEC Investigation Beginning in November 2015, the Company has received from the staff of the Los Angeles Regional Office of the SEC subpoenas for documents, as well as various document, testimony and interview requests, related to its investigation of the Company, including requests concerning the Company's former relationship with Philidor, its accounting practices and policies, its public disclosures and other matters. The Company is cooperating with the SEC in this matter. The Company cannot predict the outcome or the duration of the SEC investigation or any other legal proceedings or any enforcement actions or other remedies that may be imposed on the Company arising out of the SEC investigation. Request for Information from the AMF On April 12, 2016, the Company received a request letter from the Autorité des marchés financiers (the “AMF”) requesting documents concerning the work of the Company’s ad hoc committee of independent directors (the “Ad Hoc Committee”) (established to review certain allegations regarding the Company’s former relationship with Philidor and related matters), the Company’s former relationship with Philidor, the Company's accounting practices and policies and other matters. The Company is cooperating with the AMF in this matter. In July 2018, the Company was advised by the AMF that it had issued a formal investigation order in respect of the Company on February 2, 2018. The Company cannot predict whether any enforcement action against the Company will result from such investigation. Investigation by the State of Texas On May 27, 2014, the State of Texas served Bausch & Lomb Incorporated ("B&L Inc.") with a Civil Investigative Demand concerning various price reporting matters relating to the State's Medicaid program and the amounts the State paid in reimbursement for B&L products for the period from 1995 to the date of the Civil Investigative Demand. The Company and B&L Inc. have cooperated fully with the State's investigation and have produced all of the documents requested by the State. In April 2016, the State sent B&L Inc. a demand letter claiming damages in the amount of $20 million . The Company and B&L Inc. have evaluated the letter and disagree with the allegations and methodologies set forth in the letter. In June 2016, the Company and B&L Inc. responded to the State. In July 2018, the State responded to the Company's June 2016 letter and indicated that it disagreed with certain of the Company’s positions and would send a response to the Company's June 2016 letter in August 2018. Securities and RICO Class Actions and Related Matters U.S. Securities Litigation From October 22, 2015 to October 30, 2015, four putative securities class actions were filed in the U.S. District Court for the District of New Jersey against the Company and certain current or former officers and directors. Those four actions, captioned Potter v. Valeant Pharmaceuticals International, Inc. et al. (Case No. 15-cv-7658), Chen v. Valeant Pharmaceuticals International, Inc. et al. (Case No. 15-cv-7679), Yang v. Valeant Pharmaceuticals International, Inc. et al. (Case No. 15-cv-7746), and Fein v. Valeant Pharmaceuticals International, Inc. et al. (Case No. 15-cv-7809), all asserted securities fraud claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) on behalf of putative classes of persons who purchased or otherwise acquired the Company’s stock during various time periods between February 28, 2014 and October 21, 2015. The allegations relate to, among other things, allegedly false and misleading statements and/or failures to disclose information about the Company’s business and prospects, including relating to drug pricing, the Company’s use of specialty pharmacies, and the Company’s relationship with Philidor. On May 31, 2016, the Court entered an order consolidating the four actions under the caption In re Valeant Pharmaceuticals International, Inc. Securities Litigation, Case No. 3:15-cv-07658, and appointing a lead plaintiff and lead plaintiff’s counsel. On June 24, 2016, the lead plaintiff filed a consolidated complaint naming additional defendants and asserting additional claims based on allegations of false and misleading statements and/or omissions similar to those in the initial complaints. Specifically, the consolidated complaint asserts claims under Sections 10(b) and 20(a) of the Exchange Act against the Company, and certain current or former officers and directors, as well as claims under Sections 11, 12(a)(2) and 15 of the Securities Act of 1933 (the “Securities Act”) against the Company, certain current or former officers and directors, and certain other parties. The lead plaintiff seeks to bring these claims on behalf of a putative class of persons who purchased the Company’s equity securities and senior notes in the United States between January 4, 2013 and March 15, 2016, including all those who purchased the Company’s securities in the United States in the Company’s debt and stock offerings between July 2013 to March 2015. On September 13, 2016, the Company and the other defendants moved to dismiss the consolidated complaint. Briefing on the Company's motion was completed on January 13, 2017. On April 28, 2017, the Court dismissed certain claims arising out of the Company's private placement offerings and otherwise denied the motions to dismiss. Defendants' answers to the consolidated complaint were filed on August 18, 2017. On June 6, 2018, a putative class action was filed in the U.S. District Court for the District of New Jersey against the Company and certain current or former officers and directors. This action, captioned Timber Hill LLC, v. Valeant Pharmaceuticals International, Inc., et al., (Case No. 2:18-cv-10246), asserts securities fraud claims under Sections 10(b) and 20(a) of the Exchange Act on behalf of a putative class of persons who purchased call options or sold put options on the Company’s common stock during the period January 4, 2013 through August 11, 2016. On June 11, 2018, this action was consolidated with In re Valeant Pharmaceuticals International, Inc. Securities Litigation, (Case No. 3:15-cv-07658). In addition to the consolidated putative class action, twenty-seven groups of individual investors in the Company’s stock and debt securities at this point have chosen to opt out of the consolidated putative class action and filed securities actions in the U.S. District Court for the District of New Jersey against the Company and certain current or former officers and directors and other such proceedings may be initiated or asserted. These actions are captioned: T. Rowe Price Growth Stock Fund, Inc. v. Valeant Pharmaceuticals International, Inc. (Case No. 16-cv-5034); Equity Trustees Limited as Responsible Entity for T. Rowe Price Global Equity Fund v. Valeant Pharmaceuticals International Inc. (Case No. 16-cv-6127); Principal Funds, Inc. v. Valeant Pharmaceuticals International, Inc. (Case No. 16-cv-6128); BloombergSen Partners Fund LP v. Valeant Pharmaceuticals International, Inc. (Case No. 16-cv-7212); Discovery Global Citizens Master Fund, Ltd. v. Valeant Pharmaceuticals International, Inc. (Case No. 16-cv-7321); MSD Torchlight Partners, L.P. v. Valeant Pharmaceuticals International, Inc. (Case No. 16-cv-7324); BlueMountain Foinaven Master Fund, L.P. v. Valeant Pharmaceuticals International, Inc. (Case No. 16-cv-7328); Incline Global Master LP v. Valeant Pharmaceuticals International, Inc. (Case No. 16-cv-7494); VALIC Company I v. Valeant Pharmaceuticals International, Inc. (Case No. 16-cv-7496); Janus Aspen Series v. Valeant Pharmaceuticals International, Inc. (Case No. 16-cv-7497) (“Janus Aspen”); Okumus Opportunistic Value Fund, LTD v. Valeant Pharmaceuticals International, Inc. (Case No. 17-cv-6513) (“Okumus”); Lord Abbett Investment Trust- Lord Abbett Short Duration Income Fund, v. Valeant Pharmaceuticals International, Inc. (Case No. 17-cv-6365) (“Lord Abbett”); Pentwater Equity Opportunities Master Fund LTD v. Valeant Pharmaceuticals International, Inc., et al. (Case No. 17-cv-7552), Public Employees’ Retirement System of Mississippi v. Valeant Pharmaceuticals International Inc. (Case No. 17-cv-7625) (“Mississippi”); The Boeing Company Employee Retirement Plans Master Trust v. Valeant Pharmaceuticals International Inc., et al., (Case No. 17-cv-7636) (“Boeing”); State Board of Administration of Florida v. Valeant Pharmaceuticals International Inc. (Case No. 17-cv-12808); The Regents of the University of California v. Valeant Pharmaceuticals International, Inc. (Case No. 17-cv-13488); GMO Trust v. Valeant Pharmaceuticals International, Inc. (Case No. 18-cv-0089); Första AP Fonden v. Valeant Pharmaceuticals International, Inc. (Case No. 17-cv-12088); New York City Employees’ Retirement System v. Valeant Pharmaceuticals International, Inc. (Case No. 18-cv-0032) (“NYCERS”); Blackrock Global Allocation Fund, Inc. v. Valeant Pharmaceuticals International, Inc. (Case No. 18-cv-0343) (“Blackrock”); Colonial First State Investments Limited As Responsible Entity for Commonwealth Global Shares Fund 1 v. Valeant Pharmaceuticals International, Inc. (Case No. 18-cv-0383); Bharat Ahuja v. Valeant Pharmaceuticals International, Inc. (Case No. 18-cv-0846); Brahman Capital Corp. v. Valeant Pharmaceuticals International, Inc. (Case No. 18-cv-0893); The Prudential Insurance Company of America v. Valeant Pharmaceuticals International, Inc. (Case No. 3:18-cv-01223) (“Prudential”); Senzar Healthcare Master Fund LP v. Valeant Pharmaceuticals International, Inc. (Case No. 18-cv-02286) ("Senzar"); and 2012 Dynasty UC LLC v. Valeant Pharmaceuticals International, Inc. (Case No. 18-cv-08595) ("2012 Dynasty"). In addition, one group of individual investors in the Company’s stock securities chose to opt out of the consolidated putative class action and filed a securities action in the U.S. District Court for the Southern District of New York against the Company and certain current or former officers and directors. This action was captioned: Hound Partners Offshore Fund, LP v. Valeant Pharmaceuticals International, Inc. (Case No. 18-cv-0076) (“Hound Partners”). Defendants filed a motion to transfer the Hound Partners case to the District of New Jersey on February 2, 2018. On April 24, 2018, the Court granted Defendants' motion and the case was transferred to the District of New Jersey on May 1, 2018 (Case No. 3:18-cv-08705). These individual shareholder actions assert claims under Sections 10(b), 18, and 20(a) of the Exchange Act, Sections 11, 12(a)(2), and 15 of the Securities Act, common law fraud, and negligent misrepresentation under state law, based on alleged purchases of Company stock, options, and/or debt at various times between January 3, 2013 and August 10, 2016. Plaintiffs in the Lord Abbett, Boeing, Mississippi, NYCERS, Hound Partners and 2012 Dynasty cases additionally assert claims under the New Jersey Racketeer Influenced and Corrupt Organizations Act. The allegations in the complaints are similar to those made by plaintiffs in the putative class action. Plaintiffs in the Janus Aspen action amended the complaint on April 28, 2017. Defendants filed motions for partial dismissal in ten individual actions in the U.S. District Court for the District of New Jersey on June 16, 2017. Briefing of those motions was completed on August 25, 2017. On January 12, 2018, the Court dismissed the negligent misrepresentation claims and otherwise denied the motions for partial dismissal. On October 19, 2017, the U.S. District Court for the District of New Jersey entered an order requesting briefs from the parties regarding whether the Court should stay the putative securities class action and the individual securities law actions filed in the District of New Jersey until after the resolution of criminal proceedings against Andrew Davenport and Gary Tanner. The Court's order immediately stayed all deadlines, briefing schedules, and discovery in securities actions pending completion of the briefing and the Court’s decision. The Court directed the parties to file briefs either supporting or opposing the stay, with such briefs to be concluded by November 8, 2017. On November 29, 2017, the Court entered an order staying all proceedings and discovery, except for a document production in the putative securities class action and the briefing and resolution of any motions to dismiss, in the putative securities class action and all current and subsequent related individual securities law actions filed in the District of New Jersey. On June 5, 2018, the Court lifted the stay. Defendants filed motions for partial dismissal in the Lord Abbett, Mississippi, and Boeing cases on December 6, 2017. Briefing on those motions was completed on March 15, 2018. On July 31, 2018, the Court dismissed the common law fraud and negligent misrepresentation claims and otherwise denied the motions for partial dismissal. Defendants filed actions for partial dismissal in the Okumus case in December 18, 2017. On February 1, 2018, the parties filed a stipulation and proposed order in the Okumus case that would withdraw Defendants’ motions for partial dismissal, and dismiss Okumus’ state-law claims. The Court entered that stipulation on February 2, 2018. Defendants filed a motion for partial dismissal in the Pentwater case on February 13, 2018. Briefing on that motion was completed on March 27, 2018. Defendants filed motions for partial dismissal in the NYCERS and Blackrock cases on February 23, 2018. Briefing on those motions was completed on April 30, 2018. Defendants filed a motion for partial dismissal in the Senzar case on May 4, 2018. Briefing on this motion was completed on June 18, 2018. Defendants filed a motion for partial dismissal in the Hound Partners case on May 22, 2018. Briefing on that motion was completed on July 30, 2018. Defendants filed a motion for partial dismissal in the 2012 Dynasty case on June 15, 2018. Briefing on that motion was completed on July 27, 2018. The Company believes the individual complaints and the consolidated putative class action are without merit and intends to defend itself vigorously. Canadian Securities Litigation In 2015, six putative class actions were filed and served against the Company in Canada in the provinces of British Columbia, Ontario and Quebec. These actions are captioned: (a) Alladina v. Valeant, et al. (Case No. S-1594B6) (Supreme Court of British Columbia) (filed November 17, 2015); (b) Kowalyshyn v. Valeant, et al. (CV-15-540593-00CP) (Ontario Superior Court) (filed November 16, 2015); (c) Kowalyshyn et al. v. Valeant, et al. (CV-15-541082-00CP (Ontario Superior Court) (filed November 23, 2015); (d) O’Brien v. Valeant et al. (CV-15-543678-00CP) (Ontario Superior Court) (filed December 30, 2015); (e) Catucci v. Valeant, et al. (Court File No. 540-17-011743159) (Quebec Superior Court) (filed October 26, 2015); and (f) Rousseau-Godbout v. Valeant, et al. (Court File No. 500-06-000770-152) (Quebec Superior Court) (filed October 27, 2015). The Alladina, Kowalyshyn, O’Brien, Catucci and Rousseau-Godbout actions also name, among others, certain current or former directors and officers of the Company. The Rosseau-Godbout action was subsequently stayed by the Quebec Superior Court by consent order. Each of the five remaining actions alleges violations of Canadian provincial securities legislation on behalf of putative classes of persons who purchased or otherwise acquired securities of the Company for periods commencing as early as January 1, 2013 and ending as late as November 16, 2015. The alleged violations relate to, among other things, alleged misrepresentations and/or failures to disclose material information about the Company’s business and prospects, relating to drug pricing, the Company’s policies and accounting practices, the Company’s use of specialty pharmacies and, in particular, the Company’s relationship with Philidor. The Alladina, Kowalyshyn and O’Brien actions also assert common law claims for negligent misrepresentation, and the Alladina claim additionally asserts common law negligence, conspiracy, and claims under the British Columbia Business Corporations Act, including the statutory oppression remedies in that legislation. The Catucci action asserts claims under the Quebec Civil Code, alleging the Company breached its duty of care under the civil standard of liability contemplated by the Code. The Company is aware of two additional putative class actions that have been filed with the applicable court but which have not yet been served on the Company. These actions are captioned: (i) Okeley v. Valeant, et al. (Case No. S-159991) (Supreme Court of British Columbia) (filed December 2, 2015); and (ii) Sukenaga v Valeant et al. (CV-15-540567-00CP) (Ontario Superior Court) (filed November 16, 2015), and the factual allegations made in these actions are substantially similar to those outlined above. The Company has been advised that the plaintiffs in these actions do not intend to pursue the actions. On June 10, 2016, the Ontario Superior Court of Justice rendered its decision on carriage motions (motions held to determine who will have carriage of the class action) heard on April 8, 2016, provisionally staying the O'Brien action, in favor of the Kowalyshyn action. On September 15, 2016, in response to an arrangement between the plaintiffs in the Kowalyshyn action and the O’Brien action, the court ordered both that the Kowalyshyn action be consolidated with the O’Brien action and that the consolidated action be stayed in favor of the Catucci action pending either the further order of the Ontario court or the determination of the motion for leave in the Catucci action. In the Catucci action, motions for leave under the Quebec Securities Act and for authorization as a class proceeding were heard the week of April 24, 2017, with the motion judge reserving her decision. Prior to that hearing, the parties resolved applications by the defendants concerning jurisdiction and class composition, with the plaintiffs agreeing to revise the definition of the proposed class to exclude claims in respect of Company securities purchased in the United States. On August 29, 2017, the judge released her reasons for judgment granting the plaintiffs leave to proceed with their claims under the Quebec Securities Act and authorizing the class proceeding. On October 12, 2017, the Company and the other defendants filed applications for leave to appeal from certain aspects of the decision authorizing the class proceeding. The applications for leave to appeal were heard on November 22, 2017 and were dismissed on November 30, 2017. On October 26, 2017, the plaintiffs issued their Judicial Application Originating Class Proceedings. A timetable for certain pre-trial procedural matters in the action has been set and the notice of certification has been disseminated to class members. Among other things, the timetable established a deadline of June 19, 2018 for class members to exercise their right to opt-out of the class. In addition to the class proceedings described above, on April 12, 2018, the Company was served with an application for leave filed in the Quebec Superior Court of Justice to pursue an action under the Quebec Securities Act was commenced in the Quebec Superior Court of Justice against the Company and certain current or former officers and directors. This action is captioned BlackRock Asset Management Canada Limited et al. v. Valeant, et al. (Court File No. 500-11-054155-185). The allegations in the proceeding are similar to those made by plaintiffs in the Catucci class action. On June 18, 2018, the same BlackRock entities filed an originating application against the same defendants asserting claims under the Quebec Civil Code in respect of the same alleged misrepresentations. The Company is aware that certain other members of the Catucci class exercised their opt-out rights prior to the June 19, 2018 deadline. The Company believes that it has viable defenses in each of these actions. In each case, the Company intends to defend itself vigorously. Insurance Coverage Lawsuit On December 7, 2017, the Company filed a lawsuit against its insurance companies that issued insurance policies covering claims made against the Company, its subsidiaries, and its directors and officers during two distinct policy periods, (i) 2013-14 and (ii) 2015-16. The lawsuit is currently pending in the United States District Court for the District of New Jersey (Valeant Pharmaceuticals International, Inc., et al. v. AIG Insurance Company of Canada, et al.; 3:18-CV-00493). In the lawsuit, the Company seeks coverage for (1) the costs of defending and resolving claims brought by former shareholders and debtholders of Allergan, Inc. in In re Allergan, Inc. Proxy Violation Securities Litigation and Timber Hill LLC, individually and on behalf of all others similarly situated v. Pershing Square Capital Management, L.P., et al. (under the 2013-2014 coverage period), and (2) costs incurred and to be incurred in connection with the securities class actions and opt-out cases described in this section and certain of the investigations described above (under the 2015-2016 coverage period). RICO Class Actions Between May 27, 2016 and September 16, 2016, three virtually identical actions were filed in the U.S. District Court for the District of New Jersey against the Company and various third parties, alleging claims under the federal Racketeer Influenced Corrupt Organizations Act (“RICO”) on behalf of a putative class of certain third party payors that paid claims submitted by Philidor for certain Company branded drugs between January 2, 2013 and November 9, 2015 (Airconditioning and Refrigeration Industry Health and Welfare Trust Fund et al. v. Valeant Pharmaceuticals International. Inc. et al., No. 3:16-cv-03087, Plumbers Local Union No. 1 Welfare Fund v. Valeant Pharmaceuticals International Inc. et al., No. 3:16-cv-3885 and N.Y. Hotel Trades Council et al v. Valeant Pharmaceuticals International. Inc. et al., No. 3:16-cv-05663). On November 30, 2016, the Court entered an order consolidating the three actions under the caption In re Valeant Pharmaceuticals International, Inc. Third-Party Payor Litigation , No. 3:16-cv-03087. A consolidated class action complaint was filed on December 14, 2016. The consolidated complaint alleges, among other things, that the Defendants committed predicate acts of mail and wire fraud by submitting or causing to be submitted prescription reimbursement requests that misstated or omitted facts regarding (1) the identity and licensing status of the dispensing pharmacy; (2) the resubmission of previously denied claims; (3) patient co-pay waivers; (4) the availability of generic alternatives; and (5) the insured’s consent to renew the prescription. The complaint further alleges that these acts constitute a pattern of racketeering or a racketeering conspiracy in violation of the RICO statute and caused plaintiffs and the putative class unspecified damages, which may be trebled under the RICO statute. The Company moved to dismiss the consolidated complaint on February 13, 2017. Briefing of the motion was completed on May 17, 2017. On March 14, 2017, other defendants filed a motion to stay the RICO class action pending the resolution of criminal proceedings against Andrew Davenport and Gary Tanner. The Company did not oppose the motion to stay. On August 9, 2017, the Court granted the motion to stay and entered an order staying all proceedings in the case and accordingly terminating other pending motions. The Company believes these claims are without merit and intends to defend itself vigorously. Horizon Blue Cross Blue Shield of New Jersey Lawsuit On July 26, 2018, Horizon Blue Cross Blue Shield of New Jersey filed a lawsuit against the Company in the Superior Court of New Jersey Law Division/Essex County. This action is captioned Horizon Blue Cross Blue Shield of New Jersey v. Valeant Pharmaceuticals International Inc., et. al., (No. ESX-L-005234-18). This suit asserts a claim under the New Jersey Insurance Fraud Prevention Act, N.J.S.A. 17:33A-1 to -30, as well as claims for common law fraud and negligent misrepresentation. In its complaint, Horizon alleges that the Company and other defendants submitted and caused Horizon to pay fraudulent insurance claims. The Company disputes the claims and intends to vigorously defend this matter. Antitrust Contact Lens Antitrust Class Actions Beginning in March 2015, a number of civil antitrust class action suits were filed by purchasers of contact lenses against B&L Inc., three other contact lens manufacturers, and a contact lens distributor, alleging that the defendants engaged in an anticompetitive scheme to eliminate price competition on certain contact lens lines through the use of unilateral pricing policies. The plaintiffs in such suits alleged violations of Section 1 of the Sherman Act, 15 U.S.C. § 1, and of various state antitrust and consumer protection laws, and further alleged that the defendants have been unjustly enriched through their alleged conduct. The plaintiffs sought declaratory and injunctive relief and, where applicable, treble, punitive and/or other damages, including attorneys’ fees. By order dated June 8, 2015, the JPML centralized the suits in the Middle District of Florida, under the caption In re Disposable Contact Lens Antitrust Litigation, Case No. 3:15-md-02626-HES-JRK, before U.S. District Judge Harvey E. Schlesinger. After the Class Plaintiffs filed a corrected consolidated class action complaint on December 16, 2015, the defendants jointly moved to dismiss those complaints. On June 16, 2016, the Court granted the Defendants' motion to dismiss with respect to claims brought under the Maryland Consumer Protection Act, but denied the motion to dismiss with respect to claims brought under Sherman Act, Section 1 and other state laws. Discovery has been concluded. On March 3, 2017, the Class Plaintiffs filed their motion for class certification. On June 15, 2017, defendants filed a motion to oppose the plaintiffs' class certification motion, as well as motions to exclude plaintiffs' expert reports. An evidentiary hearing was held before Judge Schlesinger on August 1 and 2, 2018. The Company intends to vigorously defend all of these actions. Intellectual Property Patent Litigation/Paragraph IV Matters The Company (and/or certain of its affiliates) is also party to certain patent infringement proceedings in the United States and Canada, including as arising from claims filed by the Company (or that the Company anticipates filing within the required time periods) in connection with Notices of Paragraph IV Certification (in the United States) and Notices of Allegation (in Canada) received from third party generic manufacturers respecting their pending applications for generic versions of certain products sold by or on behalf of the Company, including Onexton ® , Relistor ® , Apriso ® , Uceris ® , Cardizem ® , Prolensa ® and Jublia ® in the United States and Wellbutrin ® XL and Glumetza ® in Canada, or other similar suits. These matters are proceeding in the ordinary course. In addition, patents covering the Company's branded pharmaceutical products may be challenged in proceedings other than court proceedings, including inter partes review (IPR) at the US Patent & Trademark Office. The proceedings operate under different standards from district court proceedings, and are often completed within 18 months of institution. IPR challenges have been brought against patents covering the Company's branded pharmaceutical products. For example, following Acrux DDS’s IPR petition, the US Patent and Trial Appeal Board, in May 2017, instituted inter partes review for an Orange Book-listed patent covering Jublia ® and, on June 6, 2018, issued a written determination invalidating such patent. An appeal of this decision was filed on August 7, 2018. Jublia ® continues to be covered by seven other Orange Book-listed patents owned by the Company, which expire in the years 2028 through 2034. In addition, on or about February 16, 2016, the Company received a Notice of Paragraph IV Certification dated February 11, 2016, from Actavis Laboratories FL, Inc. (“Actavis”), in which Actavis asserted that the following U.S. patents, each of which is listed in the FDA’s Orange Book for Salix Pharmaceuticals, Inc.’s (“Salix Inc.”) Xifaxan ® tablets, 550 mg, are either invalid, unenforceable and/or will not be infringed by the commercial manufacture, use or sale of Actavis’ generic rifaximin tablets, 550 mg, for which an Abbreviated New Drug Application (“ANDA”) has been filed by Actavis: U.S. Patent No. 8,309,569 (the “‘569 patent”), U.S. Patent No. 8,642,573 (the “‘573 patent”), U.S. Patent No. 8,829,017 (the “‘017 patent”), U.S. Patent No. 8,946,252 (the “‘252 patent”), U.S. Patent No. 8,969,398 (the “‘398 patent”), U.S. Patent No. 7,045,620 (the “‘620 patent”), U.S. Patent No. 7,612,199 (the “‘199 patent”), U.S. Patent No. 7,902,206 (the “‘206 patent”), U.S. Patent No. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 6 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION Reportable Segments During 2017, the Company divested certain businesses. In 2018, the Company began reallocating capital and resources to other businesses. As a result, during the second quarter of 2018, the Company’s CEO, who is the Company’s Chief Operating Decision Maker, commenced managing the business differently through changes in its operating and reportable segments, which necessitated a realignment of the Company's historical segment structure. This realignment is consistent with how the Company’s CEO currently: (i) assesses operating performance on a regular basis, (ii) makes resource allocation decisions and (iii) designates responsibilities of his direct reports. Pursuant to these changes, effective in the second quarter of 2018, the Company operates in the following reportable segments: (i) Bausch + Lomb/International segment, (ii) Salix segment, (iii) Ortho Dermatologics segment and (iv) Diversified Products segment. Prior period presentations of segment revenues and segment profits have been recast to conform to the current segment reporting structure. See Note 2, "SIGNIFICANT ACCOUNTING POLICIES" for additional information regarding changes to the Company's reportable segments. The following is a brief description of the Company’s segments: • The Bausch + Lomb/International segment consists of: (i) sales in the U.S. of pharmaceutical products, OTC products and medical device products, primarily comprised of Bausch + Lomb products, with a focus on the Vision Care, Surgical, Consumer and Ophthalmology Rx products and (ii) with the exception of sales of Solta products, sales in Canada, Europe, Asia, Latin America, Africa and the Middle East of branded pharmaceutical products, branded generic pharmaceutical products, OTC products, medical device products, and Bausch + Lomb products. • The Salix segment consists of sales in the U.S. of gastrointestinal ("GI") products. • The Ortho Dermatologics segment consists of: (i) sales in the U.S. of Ortho Dermatologics (dermatological) products and (ii) global sales of Solta medical dermatological devices. • The Diversified Products segment consists of sales in the U.S. of: (i) pharmaceutical products in the areas of neurology and certain other therapeutic classes, (ii) generic products, (iii) dentistry products, (iv) oncology (or Dendreon) products, (v) sales in the U.S. of women’s health (or Sprout) products and (vi) certain other businesses divested during 2017 that were not core to the Company's operations. As a result of the divestitures of the Company's equity interest in Dendreon (June 28, 2017) and Sprout (December 20, 2017), the Company exited the oncology and women's health businesses, respectively. Segment profit is based on operating income after the elimination of intercompany transactions. Certain costs, such as Amortization of intangible assets, Asset impairments, In-process research and development costs, Restructuring and integration costs, Acquisition-related contingent consideration costs and Other expense (income), net, are not included in the measure of segment profit, as management excludes these items in assessing segment financial performance. Corporate includes the finance, treasury, certain research and development programs, tax and legal operations of the Company’s businesses and incurs certain expenses, gains and losses related to the overall management of the Company, which are not allocated to the other business segments. In assessing segment performance and managing operations, management does not review segment assets. Furthermore, a portion of share-based compensation is considered a corporate cost, since the amount of such expense depends on Company-wide performance rather than the operating performance of any single segment. Segment Revenues and Profits Segment revenues and profits were as follows: Three Months Ended June 30, Six Months Ended June 30, (in millions) 2018 2017 2018 2017 Revenues: Bausch + Lomb/International $ 1,209 $ 1,223 $ 2,312 $ 2,357 Salix 441 387 863 689 Ortho Dermatologics 142 162 283 379 Diversified Products 336 461 665 917 $ 2,128 $ 2,233 $ 4,123 $ 4,342 Segment profits: Bausch + Lomb/International $ 350 $ 371 $ 647 $ 697 Salix 292 232 564 400 Ortho Dermatologics 59 68 104 191 Diversified Products 258 302 497 608 959 973 1,812 1,896 Corporate (161 ) (139 ) (275 ) (306 ) Amortization of intangible assets (741 ) (623 ) (1,484 ) (1,258 ) Goodwill impairments — — (2,213 ) — Asset impairments (301 ) (85 ) (345 ) (223 ) Restructuring and integration costs (7 ) (18 ) (13 ) (36 ) Acquired in-process research and development costs — (1 ) (1 ) (5 ) Acquisition-related contingent consideration 6 49 4 59 Other (expense) income, net — 19 (11 ) 259 Operating (loss) income (245 ) 175 (2,526 ) 386 Interest income 3 3 6 6 Interest expense (435 ) (459 ) (851 ) (933 ) Loss on extinguishment of debt (48 ) — (75 ) (64 ) Foreign exchange and other (9 ) 39 18 68 Loss before (provision for) benefit from income taxes $ (734 ) $ (242 ) $ (3,428 ) $ (537 ) Revenues by Segment and Product Category Revenues by segment and product category were as follows: Three Months Ended June 30, 2018 Three Months Ended June 30, 2017 (in millions) Bausch + Lomb/ International Salix Ortho Dermatologics Diversified Products Total Bausch + Lomb/ International Salix Ortho Dermatologics Diversified Products Total Pharmaceuticals $ 242 $ 441 $ 103 $ 243 $ 1,029 $ 252 $ 386 $ 126 $ 376 $ 1,140 Devices 389 — 32 — 421 360 — 27 — 387 OTC 368 — — — 368 380 — — — 380 Branded and Other Generics 193 — — 89 282 211 — — 82 293 Other revenues 17 — 7 4 28 20 1 9 3 33 $ 1,209 $ 441 $ 142 $ 336 $ 2,128 $ 1,223 $ 387 $ 162 $ 461 $ 2,233 Six Months Ended June 30, 2018 Six Months Ended June 30, 2017 (in millions) Bausch + Lomb/ International Salix Ortho Dermatologics Diversified Products Total Bausch + Lomb/ International Salix Ortho Dermatologics Diversified Products Total Pharmaceuticals $ 445 $ 863 $ 208 $ 479 $ 1,995 $ 481 $ 688 $ 308 $ 744 $ 2,221 Devices 752 — 61 — 813 682 — 50 — 732 OTC 694 — — — 694 756 — — — 756 Branded and Other Generics 384 — — 179 563 400 — — 167 567 Other revenues 37 — 14 7 58 38 1 21 6 66 $ 2,312 $ 863 $ 283 $ 665 $ 4,123 $ 2,357 $ 689 $ 379 $ 917 $ 4,342 Geographic Information Revenues are attributed to a geographic region based on the location of the customer were as follows: Three Months Ended June 30, Six Months Ended June 30, (in millions) 2018 2017 2018 2017 U.S. and Puerto Rico $ 1,261 $ 1,344 $ 2,437 $ 2,639 China 98 82 182 150 Canada 76 76 153 155 Poland 52 45 115 96 France 58 53 113 101 Japan 55 57 106 108 Mexico 54 52 97 90 Germany 42 38 92 80 Egypt 44 43 89 75 Russia 40 47 68 91 United Kingdom 31 25 58 50 Italy 23 21 45 39 Spain 23 21 44 38 Other 271 329 524 630 $ 2,128 $ 2,233 $ 4,123 $ 4,342 Major Customers Customers that accounted for 10% or more of total revenues were as follows: Six Months Ended June 30, 2018 2017 McKesson Corporation (including McKesson Specialty) 17% 19% AmerisourceBergen Corporation 18% 14% Cardinal Health, Inc. 13% 14% |
SIGNIFICANT ACCOUNTING POLICI26
SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The accompanying unaudited consolidated financial statements have been prepared by the Company in United States (“U.S.”) dollars and in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial reporting, which do not conform in all respects to the requirements of U.S. GAAP for annual financial statements. Accordingly, these notes to the unaudited consolidated financial statements should be read in conjunction with the audited consolidated financial statements prepared in accordance with U.S. GAAP that are contained in the Company’s Annual Report on Form 10-K for the year ended December 31, 2017 , filed with the U.S. Securities and Exchange Commission (the “SEC”) and the Canadian Securities Administrators. The unaudited consolidated financial statements have been prepared using accounting policies that are consistent with the policies used in preparing the Company’s audited consolidated financial statements for the year ended December 31, 2017 , except for the new accounting guidance adopted during the period. The unaudited consolidated financial statements reflect all normal and recurring adjustments necessary for a fair presentation of the Company’s financial position and results of operations for the interim periods. The operating results for the interim periods presented are not necessarily indicative of the results expected for the full year. |
Use of Estimates | In preparing the unaudited consolidated financial statements, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the unaudited consolidated financial statements, and the reported amounts of revenue and expenses during the reporting periods. Actual results could differ from these estimates. On an ongoing basis, management reviews its estimates to ensure that these estimates appropriately reflect changes in the Company’s business and new information as it becomes available. If historical experience and other factors used by management to make these estimates do not reasonably reflect future activity, the Company’s results of operations and financial position could be materially impacted. |
Principles of Consolidation | The unaudited consolidated financial statements include the accounts of the Company and those of its subsidiaries and any variable interest entities for which the Company is the primary beneficiary. All intercompany transactions and balances have been eliminated. |
Reclassifications | Certain reclassifications have been made to prior year amounts to conform to the current year presentation. |
Adoption of New Accounting Standards and Recently Issued Accounting Standards, Not Adopted as of June 30, 2017 | In May 2014, the FASB issued guidance on recognizing revenue from contracts with customers. The core principle of the revenue model is that an entity recognizes revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In applying the revenue model to contracts within its scope, an entity will: (i) identify the contract(s) with a customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, (iv) allocate the transaction price to the performance obligations in the contract and (v) recognize revenue when (or as) the entity satisfies a performance obligation. In addition to these provisions, the new standard provides implementation guidance on several other topics, including the accounting for certain revenue-related costs, as well as enhanced disclosure requirements. The new guidance requires entities to disclose both quantitative and qualitative information that enables users of financial statements to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. In March 2016, the FASB issued an amendment to clarify the implementation guidance around considerations whether an entity is a principal or an agent, impacting whether an entity reports revenue on a gross or net basis. In April 2016, the FASB issued an amendment to clarify guidance on identifying performance obligations and the implementation guidance on licensing. The guidance is effective for annual reporting periods beginning after December 15, 2017. Entities had the option of using either a full retrospective or a modified retrospective approach to adopt the guidance. The Company completed its detailed assessment and training program for its personnel. Pursuant to the detailed assessment program, the Company reviewed its revenue arrangements and assessed the differences in accounting for such contracts under the new guidance as compared with prior revenue accounting guidance. Based upon review of current customer contracts, the Company concluded the implementation of the new guidance did not have a material quantitative impact on its consolidated financial statements as the timing of revenue recognition for product sales did not significantly change. The Company adopted this guidance effective January 1, 2018 using the modified retrospective approach. Accordingly, the amounts reported in the prior period have not been restated. The new guidance did however result in additional disclosures as to the nature, amounts, and concentrations of revenue. See Note 3, "REVENUE RECOGNITION" and Note 19, "SEGMENT INFORMATION" for additional details and the application of this guidance. In October 2016, the FASB issued guidance requiring an entity to recognize the income tax consequences of an intra-entity transfer of an asset other than inventory when the transfer occurs, rather than when the asset has been sold to an outside party. This guidance was effective for the Company January 1, 2018 and was applied using a modified retrospective approach through a cumulative-effect adjustment to accumulated deficit and deferred income taxes as of the effective date. The Company recorded a net cumulative-effect adjustment of $1,209 million to increase deferred income tax assets and decrease the opening balance of Accumulated deficit for the income tax consequences deferred from past intra-entity transfers involving assets other than inventory. In January 2017, the FASB issued guidance which clarifies the definition of a business with the objective of assisting with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The Company prospectively applied the new definition to all transactions effective January 1, 2018. In January 2017, the FASB issued guidance which simplifies the subsequent measurement of goodwill by eliminating “Step 2” from the goodwill impairment test. Instead, goodwill impairment is measured as the amount by which a reporting unit's carrying value exceeds its fair value. The FASB also eliminated the requirements for any reporting unit with a zero or negative carrying amount to perform a qualitative assessment. The guidance is effective for annual periods beginning after December 15, 2019, and interim periods within those annual periods, with early adoption permitted. The Company elected to adopt this guidance effective January 1, 2018. The Company tested goodwill for impairment upon adopting this guidance and recognized impairment charges of $2,213 million , related to its Salix reporting unit and Ortho Dermatologics reporting unit at January 1, 2018. See Note 8, "INTANGIBLE ASSETS AND GOODWILL" for additional details and the application of this guidance. Recently Issued Accounting Standards, Not Adopted as of June 30, 2018 In February 2016, the FASB issued guidance on lease accounting to increase transparency and comparability among organizations that lease buildings, equipment, and other assets by requiring the recognition of lease assets and lease liabilities on the balance sheet. Consistent with the current lease accounting standard, leases will continue to be classified as finance leases or operating leases. The classification is determined based on whether the risks and rewards, as well as substantive control, have been transferred to the Company and its determination will govern the pattern of lease cost recognition. Finance leases will be accounted for in substantially the same manner as capital leases are accounted for under current U.S. GAAP. Operating leases will be accounted for (both in the statement of operations and statement of cash flows) in a manner consistent with operating leases under existing U.S. GAAP. However, as it relates to the balance sheet, lessees will recognize lease liabilities based upon the present value of remaining lease payments and corresponding right of use lease assets for operating leases with limited exception. The new guidance will also require lessees and lessors to provide additional qualitative and quantitative disclosures to help financial statement users assess the amount, timing, and uncertainty of cash flows arising from leases. The new guidance is effective for annual reporting periods beginning after December 15, 2018. Early application is permitted. The Company will adopt the standard on January 1, 2019, and is electing to apply the modified retrospective approach to recognize a cumulative-effect adjustment to accumulated deficit at the adoption date. The Company also intends to elect the available practical expedients upon adoption. The Company has an implementation project in place and is progressing on the project plan for adopting this guidance. It includes a detailed assessment program and the selection of a third-party software to assist in complying with the new standard. Although the Company anticipates that the inclusion of lease related assets and liabilities will have a material impact on the consolidated balance sheets, the Company believes its adoption will not have a material impact on the consolidated statements of operations upon adoption. While the Company is still in the process of finalizing the assessment of the impacts on the consolidated balance sheets, based on the assessment to date, the Company currently believes the most significant impact relates to assets and liabilities arising from facilities, vehicles and equipment operating leases. The Company expects that accounting for capital leases will remain substantially unchanged under the new standard. The Company does not have material lessor activity that would be impacted by the standard. In June 2016, the FASB issued guidance on the impairment of financial instruments requiring an impairment model based on expected losses rather than incurred losses. Under this guidance, an entity recognizes as an allowance its estimate of expected credit losses. The guidance is effective for annual periods beginning after December 15, 2019, and interim periods within those annual periods. Early adoption is permitted for annual periods beginning after December 15, 2018, and interim periods within those annual periods. The Company is evaluating the impact of adoption of this guidance on its financial position, results of operations and cash flows. |
SIGNIFICANT ACCOUNTING POLICI27
SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Error Corrections and Prior Period Adjustments [Table Text Block] | The following table presents the effect of the revisions on the Company’s consolidated balance sheet as of March 31, 2018: (in millions) As Previously Reported Adjustment As Revised Deferred tax liabilities, net $ 1,139 $ (112 ) $ 1,027 Total liabilities 31,275 (112 ) 31,163 Accumulated deficit (4,209 ) 112 (4,097 ) Total Bausch Health Companies Inc. shareholders' equity 4,424 112 4,536 Total equity 4,523 112 4,635 The following table presents the effect of the revisions on the Company’s consolidated statements of operations and comprehensive loss for the three months ended March 31, 2018: (in millions) As Previously Reported Adjustment As Revised Consolidated statement of operations Benefit from income taxes $ (3 ) $ (112 ) $ (115 ) Net loss (2,691 ) 112 (2,579 ) Net loss attributable to Bausch Health Companies Inc. (2,693 ) 112 (2,581 ) Basic and diluted loss per share attributable to Bausch Health Companies Inc. (7.68 ) 0.32 (7.36 ) Consolidated statement of comprehensive loss Foreign currency translation adjustment (46 ) 92 46 Other comprehensive (loss) income (46 ) 92 46 Comprehensive loss (2,737 ) 204 (2,533 ) Comprehensive loss (income) attributable to noncontrolling interest 2 (6 ) (4 ) Comprehensive loss attributable to Bausch Health Companies Inc. (2,735 ) 198 (2,537 ) |
REVENUE RECOGNITION (Tables)
REVENUE RECOGNITION (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Summary of variable consideration provisions | The following table presents the activity and ending balances of the Company’s variable consideration provisions for the six months ended June 30, 2018 . Six Months Ended June 30, 2018 (in millions) Discounts and Allowances Returns Rebates Chargebacks Distribution Fees Total Reserve balance, January 1, 2018 $ 167 $ 863 $ 1,094 $ 274 $ 148 $ 2,546 Current period provision 406 163 1,330 947 116 2,962 Payments or credits (409 ) (185 ) (1,287 ) (971 ) (120 ) (2,972 ) Reserve balance, June 30, 2018 $ 164 $ 841 $ 1,137 $ 250 $ 144 $ 2,536 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of components and classification of financial assets and liabilities measured at fair value | The following fair value hierarchy table presents the components and classification of the Company’s financial assets and liabilities measured at fair value on a recurring basis as of June 30, 2018 and December 31, 2017 : June 30, 2018 December 31, 2017 (in millions) Carrying Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Carrying Value Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Cash equivalents $ 284 $ 244 $ 40 $ — $ 265 $ 230 $ 35 $ — Restricted cash $ — $ — $ — $ — $ 77 $ 77 $ — $ — Liabilities: Acquisition-related contingent consideration $ (364 ) $ — $ — $ (364 ) $ (387 ) $ — $ — $ (387 ) |
Schedule of reconciliation of contingent consideration obligations measured on a recurring basis using significant unobservable inputs (Level 3) | The following table presents a reconciliation of contingent consideration obligations measured on a recurring basis using significant unobservable inputs (Level 3) for the six months ended June 30, 2018 : (in millions) Balance, January 1, 2018 $ 387 Adjustments to Acquisition-related contingent consideration: Accretion for the time value of money $ 12 Fair value adjustments due to changes in estimates of future payments (16 ) Acquisition-related contingent consideration (4 ) Foreign currency translation adjustment included in other comprehensive loss 1 Payments (20 ) Balance, June 30, 2018 364 Current portion included in Accrued and other current liabilities 54 Non-current portion $ 310 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Inventory Disclosure [Abstract] | |
Schedule of the components of inventories | The components of inventories, net of allowances for obsolescence were as follows: (in millions) June 30, December 31, Raw materials $ 274 $ 276 Work in process 130 146 Finished goods 589 626 $ 993 $ 1,048 |
INTANGIBLE ASSETS AND GOODWILL
INTANGIBLE ASSETS AND GOODWILL (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of components of intangible assets | The major components of intangible assets were as follows: June 30, 2018 December 31, 2017 (in millions) Gross Carrying Amount Accumulated Amortization and Impairments Net Carrying Amount Gross Carrying Amount Accumulated Amortization and Impairments Net Carrying Amount Finite-lived intangible assets: Product brands $ 20,918 $ (10,859 ) $ 10,059 $ 20,913 $ (9,281 ) $ 11,632 Corporate brands 927 (226 ) 701 933 (179 ) 754 Product rights/patents 3,297 (2,475 ) 822 3,310 (2,346 ) 964 Partner relationships 169 (164 ) 5 179 (169 ) 10 Technology and other 209 (165 ) 44 214 (147 ) 67 Total finite-lived intangible assets 25,520 (13,889 ) 11,631 25,549 (12,122 ) 13,427 Acquired IPR&D not in service 64 — 64 86 — 86 Bausch + Lomb Trademark 1,698 — 1,698 1,698 — 1,698 $ 27,282 $ (13,889 ) $ 13,393 $ 27,333 $ (12,122 ) $ 15,211 |
Schedule of estimated aggregate amortization expense for each of the five succeeding years | Estimated amortization expense, for the remainder of 2018 and each of the five succeeding years ending December 31 and thereafter is as follows: (in millions) July through December 2018 $ 1,364 2019 2,531 2020 2,261 2021 2,008 2022 1,835 2023 636 Thereafter 996 Total $ 11,631 |
Schedule of changes in the carrying amount of goodwill | The changes in the carrying amounts of goodwill during the six months ended June 30, 2018 and the year ended December 31, 2017 were as follows: (in millions) Bausch + Lomb/ International Branded Rx U.S. Diversified Products Salix Ortho Dermatologics Diversified Products Total Balance, December 31, 2016 $ 5,499 $ 7,265 $ 3,030 $ — $ — $ — $ 15,794 Realignment of segment goodwill 264 (264 ) — — — — — Balance, January 1, 2017 5,763 7,001 3,030 — — — 15,794 Goodwill reclassified to assets held for sale and subsequently disposed (30 ) (61 ) (84 ) — — — (175 ) Impairment — (312 ) — — — — (312 ) Foreign exchange and other 283 3 — — — — 286 Balance, December 31, 2017 6,016 6,631 2,946 — — — 15,593 Impairment — (2,213 ) — — — — (2,213 ) Realignment of Global Solta reporting unit goodwill (82 ) 115 (33 ) — — — — Goodwill reclassified to assets held for sale (2 ) — — — — — (2 ) Foreign exchange and other 54 — — — — — 54 Balance, March 31, 2018 5,986 4,533 2,913 — — — 13,432 Realignment of segment goodwill — (4,533 ) (2,913 ) 3,156 1,267 3,023 — Balance after realignment 5,986 — — 3,156 1,267 3,023 13,432 Foreign exchange and other (149 ) — — — — — (149 ) Balance, June 30, 2018 $ 5,837 $ — $ — $ 3,156 $ 1,267 $ 3,023 $ 13,283 |
ACCRUED AND OTHER CURRENT LIA32
ACCRUED AND OTHER CURRENT LIABILITIES (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Payables and Accruals [Abstract] | |
Schedule of accrued and other current liabilities | Accrued and other current liabilities were as follows: (in millions) June 30, December 31, Product rebates $ 1,137 $ 1,094 Product returns 841 863 Interest 306 324 Employee compensation and benefit costs 237 259 Income taxes payable 186 202 Other 720 952 $ 3,427 $ 3,694 |
FINANCING ARRANGEMENTS (Tables)
FINANCING ARRANGEMENTS (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of long-term debt | Principal amounts of debt obligations and principal amounts of debt obligations net of discounts and issuance costs consists of the following: June 30, 2018 December 31, 2017 (in millions) Maturity Principal Amount Net of Discounts and Issuance Costs Principal Amount Net of Discounts and Issuance Costs Senior Secured Credit Facilities: 2018 Revolving Credit Facility April 2018 $ — $ — $ — $ — 2020 Revolving Credit Facility April 2020 — — 250 250 2023 Revolving Credit Facility June 2023 325 325 — — Series F Tranche B Term Loan Facility April 2022 — — 3,521 3,420 2025 Term Loan B Facility June 2025 4,565 4,426 — — Senior Secured Notes: 6.50% Secured Notes March 2022 1,250 1,237 1,250 1,235 7.00% Secured Notes March 2024 2,000 1,977 2,000 1,975 5.50% Secured Notes November 2025 1,750 1,729 1,750 1,729 Senior Unsecured Notes: 5.375% March 2020 — — 1,708 1,699 7.00% October 2020 — — 71 71 6.375% October 2020 — — 661 656 7.50% July 2021 1,625 1,617 1,625 1,615 6.75% August 2021 — — 650 648 5.625% December 2021 900 896 900 896 7.25% July 2022 — — 550 545 5.50% March 2023 1,000 994 1,000 993 5.875% May 2023 3,250 3,227 3,250 3,224 4.50% euro-denominated debt May 2023 1,750 1,737 1,801 1,787 6.125% April 2025 3,250 3,224 3,250 3,222 9.00% December 2025 1,500 1,466 1,500 1,464 9.25% April 2026 1,500 1,481 — — 8.50% January 2027 750 738 — — Other Various 14 14 15 15 Total long-term debt and other $ 25,429 25,088 $ 25,752 25,444 Less: Current portion of long-term debt and other 230 209 Non-current portion of long-term debt $ 24,858 $ 25,235 |
Schedule of effective interest rates for long-term debt | ter July 31, 2022, VPI may redeem all or a portion of the January 2027 Unsecured Notes at the applicable redemption prices set forth in the January 2027 Unsecured Notes indenture, plus ac |
PENSION AND POSTRETIREMENT EM34
PENSION AND POSTRETIREMENT EMPLOYEE BENEFIT PLANS (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Retirement Benefits [Abstract] | |
Components of net periodic benefit cost | The following table provides the components of net periodic (benefit) cost for the Company’s defined benefit pension plans and postretirement benefit plan for the three and six months ended June 30, 2018 and 2017 : Pension Benefit Plans Postretirement Benefit Plan U.S. Plan Non-U.S. Plans Three Months Ended June 30, (in millions) 2018 2017 2018 2017 2018 2017 Service cost $ 1 $ — $ — $ 1 $ — $ — Interest cost 1 2 2 1 — — Expected return on plan assets (3 ) (3 ) (2 ) (1 ) — — Amortization of prior service credit — — — (1 ) (1 ) (1 ) Amortization of net loss — — — 1 — — Net periodic (benefit) cost $ (1 ) $ (1 ) $ — $ 1 $ (1 ) $ (1 ) Pension Benefit Plans Postretirement U.S. Plan Non-U.S. Plans Six Months Ended June 30, (in millions) 2018 2017 2018 2017 2018 2017 Service cost $ 1 $ 1 $ 1 $ 1 $ — $ — Interest cost 3 4 3 2 — 1 Expected return on plan assets (7 ) (6 ) (3 ) (2 ) — — Amortization of prior service credit — — — (1 ) (1 ) (2 ) Amortization of net loss — — — 1 — — Net periodic (benefit) cost $ (3 ) $ (1 ) $ 1 $ 1 $ (1 ) $ (1 ) |
SHARE-BASED COMPENSATION (Table
SHARE-BASED COMPENSATION (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Summary of the components and classification of share-based compensation expense | The following table summarizes the components and classification of share-based compensation expense related to stock options and RSUs for the three and six months ended June 30, 2018 and 2017 : Three Months Ended Six Months Ended (in millions) 2018 2017 2018 2017 Stock options $ 6 $ 5 $ 11 $ 10 RSUs 16 18 32 41 $ 22 $ 23 $ 43 $ 51 Research and development expenses $ 2 $ 2 $ 4 $ 4 Selling, general and administrative expenses 20 21 39 47 $ 22 $ 23 $ 43 $ 51 |
ACCUMULATED OTHER COMPREHENSI36
ACCUMULATED OTHER COMPREHENSIVE LOSS (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract] | |
Schedule of the components of accumulated other comprehensive loss | The components of accumulated other comprehensive loss were as follows: (in millions) June 30, December 31, Foreign currency translation adjustments $ (2,048 ) $ (1,877 ) Pension and postretirement benefit plan adjustments, net of tax (20 ) (19 ) $ (2,068 ) $ (1,896 ) |
RESEARCH AND DEVELOPMENT (Table
RESEARCH AND DEVELOPMENT (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Research and Development [Abstract] | |
Summary of research and development | Research and development costs are as follows: Three Months Ended Six Months Ended (in millions) 2018 2017 2018 2017 Product related research and development $ 84 $ 86 $ 167 $ 172 Quality assurance 10 8 19 18 $ 94 $ 94 $ 186 $ 190 |
OTHER EXPENSE (INCOME), NET (Ta
OTHER EXPENSE (INCOME), NET (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Other Income and Expenses [Abstract] | |
Schedule of other expense (income), net | Other expense (income), net were as follows: Three Months Ended Six Months Ended (in millions) 2018 2017 2018 2017 Gain on the Skincare Sale (Note 4) $ — $ — $ — $ (319 ) Gain on the Dendreon Sale (Note 4) — (73 ) — (73 ) Net loss on other sales of assets — 23 — 25 Litigation and other matters (1 ) 33 10 109 Other, net 1 (2 ) 1 (1 ) $ — $ (19 ) $ 11 $ (259 ) |
(LOSS) EARNINGS PER SHARE (Tabl
(LOSS) EARNINGS PER SHARE (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of calculation of earnings per share | (Loss) earnings per share attributable to Bausch Health Companies Inc. were calculated as follows: Three Months Ended Six Months Ended (in millions, except per share amounts) 2018 2017 2018 2017 Net (loss) income attributable to Bausch Health Companies Inc. $ (873 ) $ (38 ) $ (3,454 ) $ 590 Basic weighted-average number of common shares outstanding 351.3 350.1 351.0 350.0 Diluted effect of stock options, RSUs and other — — — 0.9 Diluted weighted-average number of common shares outstanding 351.3 350.1 351.0 350.9 (Loss) earnings per share attributable to Bausch Health Companies Inc.: Basic $ (2.49 ) $ (0.11 ) $ (9.84 ) $ 1.69 Diluted $ (2.49 ) $ (0.11 ) $ (9.84 ) $ 1.68 |
Schedule of antidilutive securities excluded from earnings per share | The dilutive effect of potential common shares issuable for stock options and RSUs on the weighted-average number of common shares outstanding would have been as follows: Three Months Ended Six Months Ended June 30, 2018 (in millions) 2018 2017 Basic weighted-average number of common shares outstanding 351.3 350.1 351.0 Diluted effect of stock options, RSUs and other 3.2 1.3 2.9 Diluted weighted-average number of common shares outstanding 354.5 351.4 353.9 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2018 | |
Segment Reporting [Abstract] | |
Schedule of segment revenues and profit | Segment revenues and profits were as follows: Three Months Ended June 30, Six Months Ended June 30, (in millions) 2018 2017 2018 2017 Revenues: Bausch + Lomb/International $ 1,209 $ 1,223 $ 2,312 $ 2,357 Salix 441 387 863 689 Ortho Dermatologics 142 162 283 379 Diversified Products 336 461 665 917 $ 2,128 $ 2,233 $ 4,123 $ 4,342 Segment profits: Bausch + Lomb/International $ 350 $ 371 $ 647 $ 697 Salix 292 232 564 400 Ortho Dermatologics 59 68 104 191 Diversified Products 258 302 497 608 959 973 1,812 1,896 Corporate (161 ) (139 ) (275 ) (306 ) Amortization of intangible assets (741 ) (623 ) (1,484 ) (1,258 ) Goodwill impairments — — (2,213 ) — Asset impairments (301 ) (85 ) (345 ) (223 ) Restructuring and integration costs (7 ) (18 ) (13 ) (36 ) Acquired in-process research and development costs — (1 ) (1 ) (5 ) Acquisition-related contingent consideration 6 49 4 59 Other (expense) income, net — 19 (11 ) 259 Operating (loss) income (245 ) 175 (2,526 ) 386 Interest income 3 3 6 6 Interest expense (435 ) (459 ) (851 ) (933 ) Loss on extinguishment of debt (48 ) — (75 ) (64 ) Foreign exchange and other (9 ) 39 18 68 Loss before (provision for) benefit from income taxes $ (734 ) $ (242 ) $ (3,428 ) $ (537 ) |
Schedule of revenues by segment and product category | Revenues by segment and product category were as follows: Three Months Ended June 30, 2018 Three Months Ended June 30, 2017 (in millions) Bausch + Lomb/ International Salix Ortho Dermatologics Diversified Products Total Bausch + Lomb/ International Salix Ortho Dermatologics Diversified Products Total Pharmaceuticals $ 242 $ 441 $ 103 $ 243 $ 1,029 $ 252 $ 386 $ 126 $ 376 $ 1,140 Devices 389 — 32 — 421 360 — 27 — 387 OTC 368 — — — 368 380 — — — 380 Branded and Other Generics 193 — — 89 282 211 — — 82 293 Other revenues 17 — 7 4 28 20 1 9 3 33 $ 1,209 $ 441 $ 142 $ 336 $ 2,128 $ 1,223 $ 387 $ 162 $ 461 $ 2,233 Six Months Ended June 30, 2018 Six Months Ended June 30, 2017 (in millions) Bausch + Lomb/ International Salix Ortho Dermatologics Diversified Products Total Bausch + Lomb/ International Salix Ortho Dermatologics Diversified Products Total Pharmaceuticals $ 445 $ 863 $ 208 $ 479 $ 1,995 $ 481 $ 688 $ 308 $ 744 $ 2,221 Devices 752 — 61 — 813 682 — 50 — 732 OTC 694 — — — 694 756 — — — 756 Branded and Other Generics 384 — — 179 563 400 — — 167 567 Other revenues 37 — 14 7 58 38 1 21 6 66 $ 2,312 $ 863 $ 283 $ 665 $ 4,123 $ 2,357 $ 689 $ 379 $ 917 $ 4,342 |
Schedule of revenue attributed to a geographic region | Revenues are attributed to a geographic region based on the location of the customer were as follows: Three Months Ended June 30, Six Months Ended June 30, (in millions) 2018 2017 2018 2017 U.S. and Puerto Rico $ 1,261 $ 1,344 $ 2,437 $ 2,639 China 98 82 182 150 Canada 76 76 153 155 Poland 52 45 115 96 France 58 53 113 101 Japan 55 57 106 108 Mexico 54 52 97 90 Germany 42 38 92 80 Egypt 44 43 89 75 Russia 40 47 68 91 United Kingdom 31 25 58 50 Italy 23 21 45 39 Spain 23 21 44 38 Other 271 329 524 630 $ 2,128 $ 2,233 $ 4,123 $ 4,342 |
Schedule of customers that accounted for 10% or more of total revenue | Customers that accounted for 10% or more of total revenues were as follows: Six Months Ended June 30, 2018 2017 McKesson Corporation (including McKesson Specialty) 17% 19% AmerisourceBergen Corporation 18% 14% Cardinal Health, Inc. 13% 14% |
DESCRIPTION OF BUSINESS - Narra
DESCRIPTION OF BUSINESS - Narrative (Details) | Jun. 30, 2018country |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of countries in which entity operates (over 90 countries) | 90 |
SIGNIFICANT ACCOUNTING POLICI42
SIGNIFICANT ACCOUNTING POLICIES - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Income taxes provision (benefit) | $ 138 | $ (115) | $ (205) | $ 23 | $ (1,129) | ||
Earnings per share, basic and diluted (in usd per share) | $ (7.36) | ||||||
Foreign currency translation adjustment | (218) | $ 46 | 56 | (172) | 146 | ||
Deferred income taxes | (42) | (1,207) | |||||
Net (loss) income | (872) | (2,579) | (37) | (3,451) | 592 | ||
Increase to deferred income taxes | 1,654 | 1,654 | $ 433 | ||||
Decrease to accumulated deficit | (4,970) | (4,097) | (4,970) | (2,725) | |||
Goodwill impairments | $ 0 | 2,213 | $ 312 | $ 0 | $ 2,213 | $ 0 | 312 |
Accounting Standards Update 2016-16 | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Increase to deferred income taxes | 1,209 | ||||||
Decrease to accumulated deficit | $ 1,209 | ||||||
Error in forecasted effective tax rate | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Income taxes provision (benefit) | $ (112) | ||||||
Earnings per share, basic and diluted (in usd per share) | $ 0.32 | ||||||
Deferred income taxes | $ 112 | ||||||
Net (loss) income | 112 | ||||||
Clerical error in preparation | |||||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||||
Foreign currency translation adjustment | $ 92 |
SIGNIFICANT ACCOUNTING POLICI43
SIGNIFICANT ACCOUNTING POLICIES - Effect of Revisions on the Consolidated Balance Sheet (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||
Deferred tax liabilities, net | $ 1,130 | $ 1,027 | $ 1,180 |
Total liabilities | 30,890 | 31,163 | 31,553 |
Accumulated deficit | (4,970) | (4,097) | (2,725) |
Total Bausch Health Companies Inc. shareholders' equity | 3,467 | 4,536 | 5,849 |
Total equity | $ 3,558 | 4,635 | $ 5,944 |
As Initially Reported | |||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||
Deferred tax liabilities, net | 1,139 | ||
Total liabilities | 31,275 | ||
Accumulated deficit | (4,209) | ||
Total Bausch Health Companies Inc. shareholders' equity | 4,424 | ||
Total equity | 4,523 | ||
Error in forecasted effective tax rate | Adjustments | |||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||
Deferred tax liabilities, net | (112) | ||
Total liabilities | (112) | ||
Accumulated deficit | 112 | ||
Total Bausch Health Companies Inc. shareholders' equity | 112 | ||
Total equity | $ 112 |
SIGNIFICANT ACCOUNTING POLICI44
SIGNIFICANT ACCOUNTING POLICIES - Effect of Revisions on Consolidated Statements of Operations and Comprehensive Loss (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||
Benefit from income taxes | $ 138 | $ (115) | $ (205) | $ 23 | $ (1,129) |
Net (loss) income | (872) | (2,579) | (37) | (3,451) | 592 |
Net (loss) income attributable to Bausch Health Companies Inc. | (873) | $ (2,581) | (38) | (3,454) | 590 |
Basic and diluted loss per share attributable to Bausch Health Companies Inc. (in usd per share) | $ (7.36) | ||||
Foreign currency translation adjustment | (218) | $ 46 | 56 | (172) | 146 |
Other comprehensive loss | (219) | 46 | 56 | (173) | 145 |
Comprehensive loss | (1,091) | (2,533) | 19 | (3,624) | 737 |
Comprehensive loss (income) attributable to noncontrolling interest | 2 | (4) | 1 | (2) | 2 |
Comprehensive loss attributable to Bausch Health Companies Inc. | $ (1,089) | (2,537) | $ 20 | $ (3,626) | $ 739 |
As Initially Reported | |||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||
Benefit from income taxes | (3) | ||||
Net (loss) income | (2,691) | ||||
Net (loss) income attributable to Bausch Health Companies Inc. | $ (2,693) | ||||
Basic and diluted loss per share attributable to Bausch Health Companies Inc. (in usd per share) | $ (7.68) | ||||
Foreign currency translation adjustment | $ (46) | ||||
Other comprehensive loss | (46) | ||||
Comprehensive loss | (2,737) | ||||
Comprehensive loss (income) attributable to noncontrolling interest | 2 | ||||
Comprehensive loss attributable to Bausch Health Companies Inc. | (2,735) | ||||
Error in forecasted effective tax rate | |||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||
Benefit from income taxes | (112) | ||||
Net (loss) income | $ 112 | ||||
Basic and diluted loss per share attributable to Bausch Health Companies Inc. (in usd per share) | $ 0.32 | ||||
Error in forecasted effective tax rate | Adjustments | |||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||
Benefit from income taxes | $ (112) | ||||
Net (loss) income | 112 | ||||
Net (loss) income attributable to Bausch Health Companies Inc. | $ 112 | ||||
Basic and diluted loss per share attributable to Bausch Health Companies Inc. (in usd per share) | $ 0.32 | ||||
Clerical error in preparation | |||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||
Foreign currency translation adjustment | $ 92 | ||||
Clerical error in preparation | Adjustments | |||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||
Foreign currency translation adjustment | 92 | ||||
Other comprehensive loss | 92 | ||||
Comprehensive loss | 204 | ||||
Comprehensive loss (income) attributable to noncontrolling interest | (6) | ||||
Comprehensive loss attributable to Bausch Health Companies Inc. | $ 198 |
REVENUE RECOGNITION - Variable
REVENUE RECOGNITION - Variable Consideration Provisions (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Movement in Valuation Allowances and Reserves [Roll Forward] | |
Reserve beginning balance | $ 2,546 |
Current period provision | 2,962 |
Payments or credits | (2,972) |
Reserve ending balance | 2,536 |
Discounts and Allowances | |
Movement in Valuation Allowances and Reserves [Roll Forward] | |
Reserve beginning balance | 167 |
Current period provision | 406 |
Payments or credits | (409) |
Reserve ending balance | 164 |
Returns | |
Movement in Valuation Allowances and Reserves [Roll Forward] | |
Reserve beginning balance | 863 |
Current period provision | 163 |
Payments or credits | (185) |
Reserve ending balance | 841 |
Rebates | |
Movement in Valuation Allowances and Reserves [Roll Forward] | |
Reserve beginning balance | 1,094 |
Current period provision | 1,330 |
Payments or credits | (1,287) |
Reserve ending balance | 1,137 |
Chargebacks | |
Movement in Valuation Allowances and Reserves [Roll Forward] | |
Reserve beginning balance | 274 |
Current period provision | 947 |
Payments or credits | (971) |
Reserve ending balance | 250 |
Distribution Fees | |
Movement in Valuation Allowances and Reserves [Roll Forward] | |
Reserve beginning balance | 148 |
Current period provision | 116 |
Payments or credits | (120) |
Reserve ending balance | $ 144 |
REVENUE RECOGNITION - Narrative
REVENUE RECOGNITION - Narrative (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Settlement period for cash discounts and allowances | 1 month | |||
1% change in estimated return rates, Impact on pre-tax earnings | $ 45 | |||
1% change in volume of product sold through to Medicaid plan participants, Impact on pre-tax earnings | 44 | |||
Revenues | $ 2,128 | $ 2,233 | $ 4,123 | $ 4,342 |
Minimum | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Payment terms | 30 days | |||
Maximum | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Payment terms | 90 days | |||
Price Appreciation Credit | ||||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | ||||
Revenues | $ 15 |
DIVESTITURES - Narrative (Detai
DIVESTITURES - Narrative (Details) $ in Millions | Nov. 09, 2017USD ($) | Sep. 29, 2017USD ($) | Jun. 28, 2017USD ($) | Mar. 03, 2017USD ($) | Dec. 31, 2017USD ($) | Jun. 30, 2018USD ($)country | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2018USD ($)country | Jun. 30, 2017USD ($) | Dec. 31, 2017USD ($) | Dec. 20, 2017USD ($) | Nov. 07, 2017USD ($) |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||||
Number of countries in which entity markets (more than 15 countries) | country | 90 | 90 | ||||||||||||
Impairment of finite-lived intangible assets | $ 80 | |||||||||||||
Sprout Pharmaceuticals, Inc. | ||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||||
Loan term | 5 years | |||||||||||||
Related party loan | $ 25 | |||||||||||||
Sprout Pharmaceuticals, Inc. | Minimum | ||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||||
Purchase obligation | $ 200 | |||||||||||||
Held-for-sale | ||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||||
Impairment of long-lived assets | $ 5 | |||||||||||||
Prepaid expenses and other current assets held for sale | $ 1 | 1 | ||||||||||||
Non-current assets held for sale | $ 12 | 11 | $ 12 | 11 | $ 12 | |||||||||
CeraVe, AcneFree, and AMBI Skincare Brands | ||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||||
Gain (loss) on sale of business | 0 | $ 0 | 0 | 319 | ||||||||||
CeraVe, AcneFree, and AMBI Skincare Brands | Held-for-sale | ||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||||
Cash consideration | $ 1,300 | |||||||||||||
Gain (loss) on sale of business | 319 | 309 | ||||||||||||
Dendreon Sale | ||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||||
Gain (loss) on sale of business | $ 0 | 73 | $ 0 | 73 | ||||||||||
Dendreon Sale | Held-for-sale | ||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||||
Cash consideration | $ 845 | |||||||||||||
Gain (loss) on sale of business | $ 73 | 97 | ||||||||||||
Dendreon Sale | Held-for-sale | Restricted Cash [Member] | ||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||||
Cash consideration | $ 811 | |||||||||||||
iNova | Held-for-sale | ||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||||
Cash consideration | $ 938 | |||||||||||||
Gain (loss) on sale of business | $ 309 | |||||||||||||
Number of countries in which entity markets (more than 15 countries) | country | 15 | 15 | ||||||||||||
Obagi | Held-for-sale | ||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||||
Cash consideration | $ 190 | |||||||||||||
Gain (loss) on sale of business | $ (13) | |||||||||||||
Impairment of finite-lived intangible assets | $ 103 | |||||||||||||
Sprout Pharmaceuticals, Inc. | Held-for-sale | ||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||||
Gain (loss) on sale of business | (98) | |||||||||||||
Impairment of long-lived assets | $ 352 | |||||||||||||
Sprout Pharmaceuticals, Inc. | Disposed of by Sale | ||||||||||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||||||||||||
Royalty percentage | 6.00% |
RESTRUCTURING AND INTEGRATION48
RESTRUCTURING AND INTEGRATION COSTS - Narrative (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
Acquisition-Related Restructuring Costs | ||
Cost-rationalization and integration initiatives | ||
Remaining restructuring liabilities | $ 39 | |
Other Restructuring, Integration-related and Other Costs | ||
Cost-rationalization and integration initiatives | ||
Incurred restructuring costs | 13 | $ 36 |
Severance costs | 8 | 7 |
Business exit costs | 5 | 14 |
Restructuring payments | $ 13 | 49 |
Restructuring costs integration consulting duplicate labor transition service and other | $ 15 |
FAIR VALUE MEASUREMENTS - Asset
FAIR VALUE MEASUREMENTS - Assets and Liabilities Measured at Fair Value on a Recurring Basis (Details) - USD ($) $ in Millions | 6 Months Ended | |||
Jun. 30, 2018 | Jan. 09, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | |
Liabilities: | ||||
Highly liquid investments, maturity period (in months) | 3 months | |||
Restricted cash | $ 0 | $ 77 | $ 77 | $ 811 |
Letters of credit | $ 77 | |||
Recurring basis | ||||
Assets: | ||||
Cash equivalents | 284 | 265 | ||
Restricted cash | 0 | 77 | ||
Liabilities: | ||||
Acquisition-related contingent consideration | (364) | (387) | ||
Recurring basis | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||||
Assets: | ||||
Cash equivalents | 244 | 230 | ||
Restricted cash | 0 | 77 | ||
Liabilities: | ||||
Acquisition-related contingent consideration | 0 | 0 | ||
Recurring basis | Significant Other Observable Inputs (Level 2) | ||||
Assets: | ||||
Cash equivalents | 40 | 35 | ||
Restricted cash | 0 | 0 | ||
Liabilities: | ||||
Acquisition-related contingent consideration | 0 | 0 | ||
Recurring basis | Significant Unobservable Inputs (Level 3) | ||||
Assets: | ||||
Cash equivalents | 0 | 0 | ||
Restricted cash | 0 | 0 | ||
Liabilities: | ||||
Acquisition-related contingent consideration | $ (364) | $ (387) |
FAIR VALUE MEASUREMENTS - Recon
FAIR VALUE MEASUREMENTS - Reconciliation of Contingent Consideration Obligations (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | |
Balance at the beginning of the period | $ 387 |
Accretion for the time value of money and fair value adjustments | (4) |
Foreign currency translation adjustment included in other comprehensive loss | 1 |
Payments | (20) |
Balance at the end of the period | 364 |
Current portion included in Accrued and other current liabilities | 54 |
Non-current portion | 310 |
Accretion for the time value of money | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | |
Accretion for the time value of money and fair value adjustments | 12 |
Fair value adjustments due to changes in estimates of future payments | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation | |
Accretion for the time value of money and fair value adjustments | $ (16) |
FAIR VALUE MEASUREMENTS - Ass51
FAIR VALUE MEASUREMENTS - Assets and Liabilities Measured on a Non-Recurring Basis (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Dec. 31, 2017 |
Nonrecurring adjustment | Significant Other Observable Inputs (Level 2) | ||
Assets Measured at Fair Value on a Recurring Basis | ||
Fair value of long-term debt | $ 24,995 | $ 25,385 |
INVENTORIES - Components of Inv
INVENTORIES - Components of Inventories (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Dec. 31, 2017 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 274 | $ 276 |
Work in process | 130 | 146 |
Finished goods | 589 | 626 |
Total Inventories | $ 993 | $ 1,048 |
INTANGIBLE ASSETS AND GOODWIL53
INTANGIBLE ASSETS AND GOODWILL - Major Components of Intangible Assets (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Dec. 31, 2017 |
Finite-lived intangible assets: | ||
Gross Carrying Amount | $ 25,520 | $ 25,549 |
Accumulated Amortization and Impairments | (13,889) | (12,122) |
Net Carrying Amount | 11,631 | 13,427 |
Total intangible assets | ||
Gross Carrying Amount | 27,282 | 27,333 |
Accumulated Amortization and Impairments | (13,889) | (12,122) |
Net Carrying Amount | 13,393 | 15,211 |
Acquired IPR&D not in service | ||
Indefinite-lived intangible assets: | ||
Gross Carrying Amount | 64 | 86 |
Accumulated Amortization and Impairments | 0 | 0 |
Net Carrying Amount | 64 | 86 |
Corporate brand | ||
Indefinite-lived intangible assets: | ||
Gross Carrying Amount | 1,698 | 1,698 |
Accumulated Amortization and Impairments | 0 | 0 |
Net Carrying Amount | 1,698 | 1,698 |
Product brands | ||
Finite-lived intangible assets: | ||
Gross Carrying Amount | 20,918 | 20,913 |
Accumulated Amortization and Impairments | (10,859) | (9,281) |
Net Carrying Amount | 10,059 | 11,632 |
Corporate brand | ||
Finite-lived intangible assets: | ||
Gross Carrying Amount | 927 | 933 |
Accumulated Amortization and Impairments | (226) | (179) |
Net Carrying Amount | 701 | 754 |
Product rights | ||
Finite-lived intangible assets: | ||
Gross Carrying Amount | 3,297 | 3,310 |
Accumulated Amortization and Impairments | (2,475) | (2,346) |
Net Carrying Amount | 822 | 964 |
Partner relationships | ||
Finite-lived intangible assets: | ||
Gross Carrying Amount | 169 | 179 |
Accumulated Amortization and Impairments | (164) | (169) |
Net Carrying Amount | 5 | 10 |
Technology and other | ||
Finite-lived intangible assets: | ||
Gross Carrying Amount | 209 | 214 |
Accumulated Amortization and Impairments | (165) | (147) |
Net Carrying Amount | $ 44 | $ 67 |
INTANGIBLE ASSETS AND GOODWIL54
INTANGIBLE ASSETS AND GOODWILL - Narrative (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||||
Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | |
Impairments | ||||||||
Impairment of intangible assets | $ 323,000,000 | |||||||
Impairment of finite-lived intangible assets | $ 80,000,000 | |||||||
Net carrying amount | $ 13,393,000,000 | 13,393,000,000 | $ 15,211,000,000 | |||||
Goodwill | 13,283,000,000 | $ 13,432,000,000 | 13,283,000,000 | 15,593,000,000 | $ 15,794,000,000 | |||
Impairment | 0 | 2,213,000,000 | $ 312,000,000 | $ 0 | 2,213,000,000 | 0 | $ 312,000,000 | |
Percentage of fair value in excess of carrying value | 15.00% | |||||||
Accumulated goodwill impairment charges | $ 3,602,000,000 | $ 3,602,000,000 | ||||||
Ortho Dermatologics | ||||||||
Impairments | ||||||||
Percentage of fair value in excess of carrying value | 5.00% | 5.00% | ||||||
Bausch Lomb / International | ||||||||
Impairments | ||||||||
Goodwill | $ 5,837,000,000 | 5,986,000,000 | $ 5,837,000,000 | $ 6,016,000,000 | 5,763,000,000 | |||
Impairment | 0 | 0 | ||||||
Branded Rx | ||||||||
Impairments | ||||||||
Goodwill | 0 | 6,631,000,000 | 7,001,000,000 | |||||
Impairment | 2,213,000,000 | $ 312,000,000 | ||||||
Branded Rx | Salix | ||||||||
Impairments | ||||||||
Impairment | 1,970,000,000 | |||||||
Branded Rx | Ortho Dermatologics | ||||||||
Impairments | ||||||||
Impairment | 243,000,000 | |||||||
Adjustments | ||||||||
Impairments | ||||||||
Goodwill | 0 | 0 | ||||||
Adjustments | Bausch Lomb / International | ||||||||
Impairments | ||||||||
Goodwill | 0 | 264,000,000 | ||||||
Adjustments | Branded Rx | ||||||||
Impairments | ||||||||
Goodwill | 115,000,000 | $ (4,533,000,000) | 115,000,000 | $ (264,000,000) | ||||
Adjustments | Bausch Lomb/International And U.S. Diversified Products Segments | ||||||||
Impairments | ||||||||
Goodwill | (115,000,000) | (115,000,000) | ||||||
Specific Product Line | ||||||||
Impairments | ||||||||
Impairment of finite-lived intangible assets | 17,000,000 | |||||||
Other Product Lines | ||||||||
Impairments | ||||||||
Impairment of finite-lived intangible assets | 13,000,000 | |||||||
Uceris | ||||||||
Impairments | ||||||||
Impairment of intangible assets | 263,000,000 | |||||||
Net carrying amount | $ 187,000,000 | 187,000,000 | ||||||
Held-for-sale | ||||||||
Impairments | ||||||||
Impairment of long-lived assets | 5,000,000 | |||||||
Held-for-sale | Certain Businesses from Diversified Products and Bausch Lomb/International Segments | ||||||||
Impairments | ||||||||
Impairment of long-lived assets | $ 113,000,000 | |||||||
Product/patent assets | ||||||||
Impairments | ||||||||
Impairment of finite-lived intangible assets | $ 17,000,000 |
INTANGIBLE ASSETS AND GOODWIL55
INTANGIBLE ASSETS AND GOODWILL - Amortization Expense (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Dec. 31, 2017 |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
July through December 2018 | $ 1,364 | |
2,019 | 2,531 | |
2,020 | 2,261 | |
2,021 | 2,008 | |
2,022 | 1,835 | |
2,023 | 636 | |
Thereafter | 996 | |
Net Carrying Amount | $ 11,631 | $ 13,427 |
INTANGIBLE ASSETS AND GOODWIL56
INTANGIBLE ASSETS AND GOODWILL - Changes in Carrying Amount of Goodwill (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | $ 13,432 | $ 15,593 | $ 15,593 | $ 15,794 | $ 15,794 | ||
Goodwill reclassified to assets held for sale and subsequently disposed | (2) | (175) | |||||
Impairment | 0 | (2,213) | $ (312) | $ 0 | (2,213) | 0 | (312) |
Realignment of Global Solta reporting unit goodwill | 0 | ||||||
Foreign exchange and other | (149) | 54 | 286 | ||||
Balance at the end of the period | 13,283 | 13,432 | 13,283 | 15,593 | |||
As Initially Reported | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | 13,432 | 15,794 | 15,794 | ||||
Balance at the end of the period | 13,432 | ||||||
Adjustments | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | 0 | 0 | 0 | ||||
Balance at the end of the period | 0 | ||||||
Bausch Lomb / International | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | 5,986 | 6,016 | 6,016 | 5,763 | 5,763 | ||
Goodwill reclassified to assets held for sale and subsequently disposed | (2) | (30) | |||||
Impairment | 0 | 0 | |||||
Realignment of Global Solta reporting unit goodwill | (82) | ||||||
Foreign exchange and other | (149) | 54 | 283 | ||||
Balance at the end of the period | 5,837 | 5,986 | 5,837 | 6,016 | |||
Bausch Lomb / International | As Initially Reported | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | 5,986 | 5,499 | 5,499 | ||||
Balance at the end of the period | 5,986 | ||||||
Bausch Lomb / International | Adjustments | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | 0 | 264 | 264 | ||||
Balance at the end of the period | 0 | ||||||
Branded Rx | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | 0 | 6,631 | 6,631 | 7,001 | 7,001 | ||
Goodwill reclassified to assets held for sale and subsequently disposed | 0 | (61) | |||||
Impairment | (2,213) | (312) | |||||
Realignment of Global Solta reporting unit goodwill | 115 | ||||||
Foreign exchange and other | 0 | 3 | |||||
Balance at the end of the period | 0 | 6,631 | |||||
Branded Rx | As Initially Reported | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | 4,533 | 7,265 | 7,265 | ||||
Balance at the end of the period | 4,533 | ||||||
Branded Rx | Adjustments | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | (4,533) | (264) | (264) | ||||
Balance at the end of the period | 115 | (4,533) | 115 | ||||
U.S. Diversified Products | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | 0 | 2,946 | 2,946 | 3,030 | 3,030 | ||
Goodwill reclassified to assets held for sale and subsequently disposed | 0 | (84) | |||||
Impairment | 0 | 0 | |||||
Realignment of Global Solta reporting unit goodwill | (33) | ||||||
Foreign exchange and other | 0 | 0 | |||||
Balance at the end of the period | 0 | 2,946 | |||||
U.S. Diversified Products | As Initially Reported | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | 2,913 | 3,030 | 3,030 | ||||
Balance at the end of the period | 2,913 | ||||||
U.S. Diversified Products | Adjustments | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | (2,913) | $ 0 | $ 0 | ||||
Balance at the end of the period | (2,913) | ||||||
Salix | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | 3,156 | ||||||
Foreign exchange and other | 0 | ||||||
Balance at the end of the period | 3,156 | 3,156 | 3,156 | ||||
Salix | Adjustments | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | 3,156 | ||||||
Balance at the end of the period | 3,156 | ||||||
Ortho Dermatologics | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | 1,267 | ||||||
Foreign exchange and other | 0 | ||||||
Balance at the end of the period | 1,267 | 1,267 | 1,267 | ||||
Ortho Dermatologics | Adjustments | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | 1,267 | ||||||
Balance at the end of the period | 1,267 | ||||||
Diversified Products | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | 3,023 | ||||||
Foreign exchange and other | 0 | ||||||
Balance at the end of the period | 3,023 | 3,023 | $ 3,023 | ||||
Diversified Products | Adjustments | |||||||
Change in the carrying amount of goodwill | |||||||
Balance at the beginning of the period | $ 3,023 | ||||||
Balance at the end of the period | $ 3,023 |
ACCRUED AND OTHER CURRENT LIA57
ACCRUED AND OTHER CURRENT LIABILITIES - Summary of Accrued and Other Current Liabilities (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Dec. 31, 2017 |
Payables and Accruals [Abstract] | ||
Product rebates | $ 1,137 | $ 1,094 |
Product returns | 841 | 863 |
Interest | 306 | 324 |
Employee compensation and benefit costs | 237 | 259 |
Income taxes payable | 186 | 202 |
Other | 720 | 952 |
Accrued and other current liabilities | $ 3,427 | $ 3,694 |
FINANCING ARRANGEMENTS - Summar
FINANCING ARRANGEMENTS - Summary of Consolidated Long-term Debt (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Jun. 01, 2018 | Dec. 31, 2017 | Mar. 21, 2017 | Mar. 27, 2015 | Oct. 04, 2012 | Sep. 28, 2010 |
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 25,429 | $ 25,752 | |||||
Total long-term debt and other | 25,088 | 25,444 | |||||
Less current portion | 230 | 209 | |||||
Non-current portion of long-term debt | 24,858 | 25,235 | |||||
Series F Tranche B Term Loan Facility | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 0 | 3,521 | |||||
Stated interest rate on debt (as a percent) | 4.98% | ||||||
Total long-term debt and other | $ 0 | 3,420 | |||||
2025 Term Loan B Facility | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | 4,565 | 0 | |||||
Total long-term debt and other | 4,426 | 0 | |||||
6.50% Senior Secured Notes due March in 2022 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Stated interest rate on debt (as a percent) | 6.50% | ||||||
7.00% Senior Secured Notes due in March 2024 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Stated interest rate on debt (as a percent) | 7.00% | ||||||
7.00% Senior Notes due in October 2020 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Stated interest rate on debt (as a percent) | 7.00% | ||||||
Senior Secured Notes | 6.50% Senior Secured Notes due March in 2022 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 1,250 | 1,250 | |||||
Stated interest rate on debt (as a percent) | 6.50% | ||||||
Total long-term debt and other | $ 1,237 | 1,235 | |||||
Senior Secured Notes | 7.00% Senior Secured Notes due in March 2024 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 2,000 | 2,000 | |||||
Stated interest rate on debt (as a percent) | 7.00% | ||||||
Total long-term debt and other | $ 1,977 | 1,975 | |||||
Senior Secured Notes | 5.50% Senior Secured Notes due in November 2025 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 1,750 | 1,750 | |||||
Stated interest rate on debt (as a percent) | 5.50% | ||||||
Total long-term debt and other | $ 1,729 | 1,729 | |||||
Senior Unsecured Notes | 5.375% Senior Notes due March 2020 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 0 | 1,708 | |||||
Stated interest rate on debt (as a percent) | 5.375% | 5.375% | |||||
Total long-term debt and other | $ 0 | 1,699 | |||||
Senior Unsecured Notes | 7.00% Senior Notes due in October 2020 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 0 | 71 | |||||
Stated interest rate on debt (as a percent) | 7.00% | ||||||
Total long-term debt and other | $ 0 | 71 | |||||
Senior Unsecured Notes | 6.375% Senior Notes due in October 2020 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 0 | 661 | |||||
Stated interest rate on debt (as a percent) | 6.375% | 6.375% | |||||
Total long-term debt and other | $ 0 | 656 | |||||
Senior Unsecured Notes | 7.50% Senior Notes due in July 2021 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 1,625 | 1,625 | |||||
Stated interest rate on debt (as a percent) | 7.50% | ||||||
Total long-term debt and other | $ 1,617 | 1,615 | |||||
Senior Unsecured Notes | 6.75% Senior Notes due in August 2021 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 0 | 650 | |||||
Stated interest rate on debt (as a percent) | 6.75% | ||||||
Total long-term debt and other | $ 0 | 648 | |||||
Senior Unsecured Notes | 5.625% Senior Notes due in December 2021 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 900 | 900 | |||||
Stated interest rate on debt (as a percent) | 5.625% | ||||||
Total long-term debt and other | $ 896 | 896 | |||||
Senior Unsecured Notes | 7.25% Senior Notes due in July 2022 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 0 | 550 | |||||
Stated interest rate on debt (as a percent) | 7.25% | ||||||
Total long-term debt and other | $ 0 | 545 | |||||
Senior Unsecured Notes | 5.50% Senior Notes due March 2023 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 1,000 | 1,000 | |||||
Stated interest rate on debt (as a percent) | 5.50% | ||||||
Total long-term debt and other | $ 994 | 993 | |||||
Senior Unsecured Notes | 5.875% Senior Notes due May 2023 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 3,250 | 3,250 | |||||
Stated interest rate on debt (as a percent) | 5.875% | ||||||
Total long-term debt and other | $ 3,227 | 3,224 | |||||
Senior Unsecured Notes | 4.50% Senior Notes due May 2023 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 1,750 | 1,801 | |||||
Stated interest rate on debt (as a percent) | 4.50% | ||||||
Total long-term debt and other | $ 1,737 | 1,787 | |||||
Senior Unsecured Notes | 6.125% Senior Notes due April 2025 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 3,250 | 3,250 | |||||
Stated interest rate on debt (as a percent) | 6.125% | ||||||
Total long-term debt and other | $ 3,224 | 3,222 | |||||
Senior Unsecured Notes | 9.00% Senior Notes due December 2025 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 1,500 | 1,500 | |||||
Stated interest rate on debt (as a percent) | 9.00% | ||||||
Total long-term debt and other | $ 1,466 | 1,464 | |||||
Senior Unsecured Notes | 9.25% Senior Notes due April 2026 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 1,500 | 0 | |||||
Stated interest rate on debt (as a percent) | 9.25% | ||||||
Total long-term debt and other | $ 1,481 | 0 | |||||
Senior Unsecured Notes | 8.50% Senior Notes Due January 2027 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 750 | 0 | |||||
Stated interest rate on debt (as a percent) | 8.50% | 8.50% | |||||
Total long-term debt and other | $ 738 | 0 | |||||
Senior Unsecured Notes | Other | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | 14 | 15 | |||||
Total long-term debt and other | 14 | 15 | |||||
Revolving Credit Facility | Revolving Credit Facility Due April 2018 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | 0 | 0 | |||||
Total long-term debt and other | 0 | 0 | |||||
Revolving Credit Facility | Revolving Credit Facility Due April 2020 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | 0 | 250 | |||||
Total long-term debt and other | 0 | 250 | |||||
Revolving Credit Facility | Revolving Credit Facility Due June 2023 | |||||||
Long-term debt, net of unamortized debt discount | |||||||
Principal Amount | $ 325 | 0 | |||||
Stated interest rate on debt (as a percent) | 4.98% | ||||||
Total long-term debt and other | $ 325 | $ 0 |
FINANCING ARRANGEMENTS - Senior
FINANCING ARRANGEMENTS - Senior Secured Credit Facilities (Details) - USD ($) | Jun. 01, 2018 | Apr. 20, 2018 | Nov. 21, 2017 | Nov. 10, 2017 | Oct. 05, 2017 | Jul. 03, 2017 | Mar. 28, 2017 | Mar. 21, 2017 | Apr. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Apr. 19, 2018 | Dec. 31, 2017 | Mar. 20, 2017 | Jan. 01, 2017 | Mar. 27, 2015 | Oct. 04, 2012 |
Debt Instrument [Line Items] | |||||||||||||||||||
Loss on extinguishment of debt | $ 48,000,000 | $ 0 | $ 75,000,000 | $ 64,000,000 | |||||||||||||||
Debt issuance costs | 74,000,000 | 74,000,000 | |||||||||||||||||
Debt modification costs | $ 4,000,000 | ||||||||||||||||||
Repayments of long-term debt | 7,836,000,000 | 7,839,000,000 | |||||||||||||||||
Net proceeds from the issuance of debt | 7,474,000,000 | $ 6,232,000,000 | |||||||||||||||||
Long-term debt | $ 25,088,000,000 | $ 25,088,000,000 | $ 25,444,000,000 | ||||||||||||||||
Senior Secured Credit Facilities | Federal Funds | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Variable rate (as a percentage) | 0.50% | ||||||||||||||||||
Senior Secured Credit Facilities | Eurocurrency rate | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Variable rate (as a percentage) | 1.00% | ||||||||||||||||||
Senior Secured Credit Facilities | Eurocurrency rate | Minimum | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Variable rate (as a percentage) | 1.00% | ||||||||||||||||||
Series F Tranche B Term Loan Facility | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Maximum borrowing capacity | $ 3,060,000,000 | ||||||||||||||||||
Quarterly amortization rate (as a percent) | 1.25% | 0.25% | |||||||||||||||||
Annual amortization rate (as a percent) | 5.00% | 1.00% | |||||||||||||||||
Stated interest rate on debt (as a percent) | 4.98% | 4.98% | |||||||||||||||||
Repayments of Revolving Credit Facility | $ 750,000,000 | ||||||||||||||||||
Loss on extinguishment of debt | $ 27,000,000 | ||||||||||||||||||
Debt issuance costs | 38,000,000 | ||||||||||||||||||
Debt modification costs | 3,000,000 | ||||||||||||||||||
Repayments of long-term debt | $ 3,315,000,000 | $ 750,000,000 | $ 181,000,000 | $ 923,000,000 | $ 811,000,000 | $ 220,000,000 | |||||||||||||
Long-term debt | $ 0 | $ 0 | 3,420,000,000 | ||||||||||||||||
Revolving Credit Facility Due June 2023 | Eurocurrency rate | Minimum | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Variable rate (as a percentage) | 0.00% | ||||||||||||||||||
Revolving Credit Facility Due June 2023 | Canada Bankers Acceptance Rate [Member] | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Variable rate (as a percentage) | 1.00% | ||||||||||||||||||
Revolving Credit Facility Due June 2023 | Canada Bankers Acceptance Rate [Member] | Minimum | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Variable rate (as a percentage) | 0.00% | ||||||||||||||||||
2025 Term Loan B Facility | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Annual amortization rate (as a percent) | 5.00% | ||||||||||||||||||
Principal amount | $ 4,565,000,000 | ||||||||||||||||||
Debt term | 7 years | ||||||||||||||||||
Long-term debt | $ 4,426,000,000 | $ 4,426,000,000 | 0 | ||||||||||||||||
2025 Term Loan B Facility | Base Rate | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Variable rate (as a percentage) | 2.00% | ||||||||||||||||||
2025 Term Loan B Facility | Eurocurrency rate | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Variable rate (as a percentage) | 3.00% | ||||||||||||||||||
Senior Unsecured Notes | 6.75% Senior Unsecured Notes due August 2018 | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Principal amount | $ 1,100,000,000 | ||||||||||||||||||
Stated interest rate on debt (as a percent) | 6.75% | ||||||||||||||||||
Senior Unsecured Notes | 5.375% Senior Notes due March 2020 | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Stated interest rate on debt (as a percent) | 5.375% | 5.375% | 5.375% | ||||||||||||||||
Repayments of long-term debt | $ 691,000,000 | ||||||||||||||||||
Long-term debt | $ 0 | $ 0 | 1,699,000,000 | ||||||||||||||||
Senior Unsecured Notes | 6.75% Senior Notes due in August 2021 | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Stated interest rate on debt (as a percent) | 6.75% | 6.75% | |||||||||||||||||
Repayments of long-term debt | 578,000,000 | ||||||||||||||||||
Long-term debt | $ 0 | $ 0 | 648,000,000 | ||||||||||||||||
Senior Unsecured Notes | 7.25% Senior Notes due in July 2022 | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Stated interest rate on debt (as a percent) | 7.25% | 7.25% | |||||||||||||||||
Repayments of long-term debt | 550,000,000 | ||||||||||||||||||
Long-term debt | $ 0 | $ 0 | 545,000,000 | ||||||||||||||||
Senior Unsecured Notes | 6.375% Senior Notes due in October 2020 | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Stated interest rate on debt (as a percent) | 6.375% | 6.375% | 6.375% | ||||||||||||||||
Repayments of long-term debt | $ 146,000,000 | ||||||||||||||||||
Long-term debt | $ 0 | $ 0 | 656,000,000 | ||||||||||||||||
Senior Unsecured Notes | 8.50% Senior Notes Due January 2027 | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Stated interest rate on debt (as a percent) | 8.50% | 8.50% | 8.50% | ||||||||||||||||
Net proceeds from the issuance of debt | $ 750,000,000 | ||||||||||||||||||
Long-term debt | $ 738,000,000 | $ 738,000,000 | 0 | ||||||||||||||||
Revolving Credit Facility | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Maximum borrowing capacity | $ 1,190,000,000 | $ 1,500,000,000 | |||||||||||||||||
Repayments of Revolving Credit Facility | $ 250,000,000 | $ 350,000,000 | |||||||||||||||||
Loss on extinguishment of debt | $ 1,000,000 | ||||||||||||||||||
Maturity date extension period | 91 days | ||||||||||||||||||
Other indebtedness for borrowed money threshold | $ 750,000,000 | ||||||||||||||||||
Additional borrowing capacity | $ 60,000,000 | ||||||||||||||||||
Quarterly amortization payments | $ 1,541,000,000 | ||||||||||||||||||
Secured leverage ratio | 4 | 4 | |||||||||||||||||
Threshold for incremental borrowings | $ 1,000,000,000 | $ 1,000,000,000 | |||||||||||||||||
Interest coverage ratio | 2 | 2 | |||||||||||||||||
Revolving Credit Facility | Revolving Credit Facility Due April 2020 | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Long-term debt | $ 0 | $ 0 | 250,000,000 | ||||||||||||||||
Revolving Credit Facility | Revolving Credit Facility Due April 2020 | Base Rate | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Variable rate (as a percentage) | 2.50% | ||||||||||||||||||
Revolving Credit Facility | Revolving Credit Facility Due April 2020 | LIBOR | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Variable rate (as a percentage) | 3.50% | ||||||||||||||||||
Revolving Credit Facility | Revolving Credit Facility Due June 2023 | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Maximum borrowing capacity | $ 1,225,000,000 | ||||||||||||||||||
Stated interest rate on debt (as a percent) | 4.98% | 4.98% | |||||||||||||||||
Alternate debt term, number of days prior to scheduled maturity of principal amount in excess of threshold | 91 days | ||||||||||||||||||
Alternate debt term, principal amount in excess of threshold | $ 1,000,000,000 | $ 1,000,000,000 | |||||||||||||||||
Long-term debt | 325,000,000 | 325,000,000 | $ 0 | ||||||||||||||||
Remaining borrowings | $ 731,000,000 | $ 731,000,000 | |||||||||||||||||
Revolving Credit Facility | Revolving Credit Facility Due June 2023 | Minimum | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Commitment fee (as a percent) | 0.25% | ||||||||||||||||||
Revolving Credit Facility | Revolving Credit Facility Due June 2023 | Maximum | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Commitment fee (as a percent) | 0.50% | ||||||||||||||||||
Revolving Credit Facility | Revolving Credit Facility Due June 2023 | Base Rate | Minimum | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Variable rate (as a percentage) | 1.50% | ||||||||||||||||||
Revolving Credit Facility | Revolving Credit Facility Due June 2023 | Base Rate | Maximum | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Variable rate (as a percentage) | 2.00% | ||||||||||||||||||
Revolving Credit Facility | Revolving Credit Facility Due June 2023 | Eurocurrency rate | Minimum | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Variable rate (as a percentage) | 2.50% | ||||||||||||||||||
Revolving Credit Facility | Revolving Credit Facility Due June 2023 | Eurocurrency rate | Maximum | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Variable rate (as a percentage) | 3.00% | ||||||||||||||||||
Revolving Credit Facility | Senior Secured Notes | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Secured leverage ratio | 3.50 | 3.50 | |||||||||||||||||
Revolving Credit Facility | Senior Unsecured Notes | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Secured leverage ratio | 6.50 | 6.50 | |||||||||||||||||
Letter of Credit | Revolving Credit Facility Due April 2020 | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Maximum borrowing capacity | $ 300,000,000 | ||||||||||||||||||
Letter of Credit | Revolving Credit Facility Due June 2023 | |||||||||||||||||||
Debt Instrument [Line Items] | |||||||||||||||||||
Long-term debt | $ 169,000,000 | $ 169,000,000 |
FINANCING ARRANGEMENTS - Seni60
FINANCING ARRANGEMENTS - Senior Secured Notes (Details) - USD ($) | Apr. 20, 2018 | Nov. 21, 2017 | Mar. 21, 2017 | Dec. 31, 2017 | Jun. 30, 2018 | Mar. 26, 2018 | Dec. 18, 2017 | Oct. 17, 2017 | Sep. 28, 2010 |
Debt Instrument [Line Items] | |||||||||
Redemption price percentage to change in control (as a percent) | 101.00% | ||||||||
Revolving Credit Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Repayments of Revolving Credit Facility | $ 250,000,000 | $ 350,000,000 | |||||||
Senior Unsecured Notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Redemption price percentage to change in control (as a percent) | 101.00% | ||||||||
Repurchased principal amount | 1,100,000,000 | $ 1,500,000,000 | |||||||
March 2022 Senior Secured Notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Principal amount | $ 1,250,000,000 | ||||||||
Stated interest rate on debt (as a percent) | 6.50% | ||||||||
March 2024 Senior Secured Notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Principal amount | $ 2,000,000,000 | ||||||||
Stated interest rate on debt (as a percent) | 7.00% | ||||||||
5.50% Senior Secured Notes due in November 2025 | Senior Secured Notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Principal amount | $ 750,000,000 | $ 1,000,000,000 | |||||||
Stated interest rate on debt (as a percent) | 5.50% | ||||||||
6.375% Senior Notes due in October 2020 | |||||||||
Debt Instrument [Line Items] | |||||||||
Repurchased principal amount | $ 569,000,000 | ||||||||
6.375% Senior Notes due in October 2020 | Senior Unsecured Notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Repurchased principal amount | $ 104,000,000 | $ 411,000,000 | $ 1,021,000,000 | ||||||
7.00% Senior Notes due in October 2020 | |||||||||
Debt Instrument [Line Items] | |||||||||
Stated interest rate on debt (as a percent) | 7.00% | ||||||||
Repurchased principal amount | $ 431,000,000 | ||||||||
7.00% Senior Notes due in October 2020 | Senior Unsecured Notes | |||||||||
Debt Instrument [Line Items] | |||||||||
Stated interest rate on debt (as a percent) | 7.00% | ||||||||
Repurchased principal amount | $ 188,000,000 | ||||||||
Series F Tranche B Term Loan Facility | |||||||||
Debt Instrument [Line Items] | |||||||||
Stated interest rate on debt (as a percent) | 4.98% | ||||||||
Repayments of Revolving Credit Facility | $ 750,000,000 |
FINANCING ARRANGEMENTS - Seni61
FINANCING ARRANGEMENTS - Senior Unsecured Notes (Details) - USD ($) $ in Millions | Mar. 26, 2018 | Dec. 18, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | Oct. 17, 2017 | Aug. 15, 2017 | Mar. 21, 2017 | Jul. 12, 2013 | Sep. 28, 2010 |
Debt Instrument [Line Items] | ||||||||||||
Redemption price percentage to change in control (as a percent) | 101.00% | |||||||||||
Repayments of long-term debt | $ 7,836 | $ 7,839 | ||||||||||
Loss on extinguishment of debt | $ 48 | $ 0 | 75 | $ 64 | ||||||||
7.00% Senior Notes due in October 2020 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Stated interest rate on debt (as a percent) | 7.00% | |||||||||||
Repurchased principal amount | $ 431 | |||||||||||
6.375% Senior Notes due in October 2020 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Repurchased principal amount | $ 569 | |||||||||||
Senior Unsecured Notes | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Redemption price percentage to change in control (as a percent) | 101.00% | |||||||||||
Repurchased principal amount | $ 1,500 | $ 1,100 | ||||||||||
Senior Unsecured Notes | 6.75% Senior Unsecured Notes due August 2018 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Stated interest rate on debt (as a percent) | 6.75% | |||||||||||
Repurchased principal amount | $ 500 | |||||||||||
Senior Unsecured Notes | 7.00% Senior Notes due in October 2020 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Stated interest rate on debt (as a percent) | 7.00% | |||||||||||
Repurchased principal amount | $ 188 | |||||||||||
Senior Unsecured Notes | 6.375% Senior Notes due in October 2020 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Repurchased principal amount | 411 | 1,021 | $ 104 | $ 104 | ||||||||
Senior Unsecured Notes | 5.375% Senior Notes due March 2020 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Repurchased principal amount | $ 1,017 | $ 291 | ||||||||||
Senior Unsecured Notes | 9.00% Senior Notes due December 2025 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Stated interest rate on debt (as a percent) | 9.00% | |||||||||||
Proceeds from debt issuance | $ 1,500 | |||||||||||
Senior Unsecured Notes | 9.25% Senior Notes due April 2026 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Stated interest rate on debt (as a percent) | 9.25% | |||||||||||
Proceeds from debt issuance | $ 1,500 | |||||||||||
Redemption price percentage (as a percent) | 100.00% | |||||||||||
Maximum percentage of the aggregate principal amount that may be redeemed with the net proceeds of certain equity offerings | 40.00% | |||||||||||
Senior Unsecured Notes | 6.75% Senior Notes due in August 2021 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Repurchased principal amount | $ 72 |
FINANCING ARRANGEMENTS - Aggreg
FINANCING ARRANGEMENTS - Aggregate Maturities of Long-Term Debt (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Dec. 31, 2017 |
Debt Disclosure [Abstract] | ||
July through December 2018 | $ 114 | |
2,019 | 230 | |
2,020 | 228 | |
2,021 | 2,753 | |
2,022 | 1,478 | |
2,023 | 6,553 | |
Thereafter | 14,073 | |
Total gross maturities | 25,429 | $ 25,752 |
Unamortized discounts | (341) | |
Total long-term debt and other | $ 25,088 | $ 25,444 |
FINANCING ARRANGEMENTS - Maturi
FINANCING ARRANGEMENTS - Maturities and Weighted Average Stated Rate of Interest (Details) - USD ($) $ in Millions | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Debt Instrument [Line Items] | |||
Weighted average effective interest rate (as a percent) | 6.28% | 6.07% | |
Repayments of long-term debt | $ 7,836 | $ 7,839 |
PENSION AND POSTRETIREMENT EM64
PENSION AND POSTRETIREMENT EMPLOYEE BENEFIT PLANS - Components of Net Periodic Benefit Cost (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Pension Plan | U.S. Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 1 | $ 0 | $ 1 | $ 1 |
Interest cost | 1 | 2 | 3 | 4 |
Expected return on plan assets | (3) | (3) | (7) | (6) |
Amortization of prior service credit | 0 | 0 | 0 | 0 |
Amortization of net loss | 0 | 0 | 0 | 0 |
Net periodic (benefit) cost | (1) | (1) | (3) | (1) |
Pension Plan | Non-U.S. Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 0 | 1 | 1 | 1 |
Interest cost | 2 | 1 | 3 | 2 |
Expected return on plan assets | (2) | (1) | (3) | (2) |
Amortization of prior service credit | 0 | (1) | 0 | (1) |
Amortization of net loss | 0 | 1 | 0 | 1 |
Net periodic (benefit) cost | 0 | 1 | 1 | 1 |
Postretirement Benefit Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 0 | 0 | 0 | 0 |
Interest cost | 0 | 0 | 0 | 1 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Amortization of prior service credit | (1) | (1) | (1) | (2) |
Amortization of net loss | 0 | 0 | 0 | 0 |
Net periodic (benefit) cost | $ (1) | $ (1) | $ (1) | $ (1) |
PENSION AND POSTRETIREMENT EM65
PENSION AND POSTRETIREMENT EMPLOYEE BENEFIT PLANS - Narrative (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2018USD ($) | |
Postretirement Benefit Plan | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Defined benefit plan contributions made | $ 2 |
Estimated Company contributions in current fiscal year | 6 |
U.S. Plan | Pension Plan | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Defined benefit plan contributions made | 2 |
Estimated Company contributions in current fiscal year | 5 |
Non-U.S. Plan | Pension Plan | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Defined benefit plan contributions made | 4 |
Estimated Company contributions in current fiscal year | $ 7 |
SHARE-BASED COMPENSATION - Narr
SHARE-BASED COMPENSATION - Narrative (Details) - USD ($) | Apr. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | May 31, 2014 |
Stock option activity | |||||
Remaining unrecognized compensation expense related to non-vested awards | $ 131,000,000 | ||||
Weighted average service period over which compensation cost is expected to be recognized (in years) | 2 years 1 month 8 days | ||||
Stock options | |||||
Stock option activity | |||||
Granted (in shares) | 2,076,000 | 1,525,000 | |||
Weighted average exercise price (in usd per share) | $ 15.35 | $ 14.27 | |||
Weighted average grant date fair value of stock options (in usd per share) | $ 7.82 | $ 5.99 | |||
Time-based RSUs | |||||
Stock option activity | |||||
Granted (in shares) | 2,726,000 | 3,425,000 | |||
Weighted average grant date fair value of stock options (in usd per share) | $ 17.07 | $ 11.68 | |||
Performance-based RSUs | |||||
Stock option activity | |||||
Granted (in shares) | 878,000 | 416,000 | |||
Performance-based RSUs | Chief Executive Officer | |||||
Stock option activity | |||||
Value of long term incentives | $ 10,000,000 | ||||
Number of shares canceled (in shares) | 933,000 | ||||
TSR Performance-based RSUs | |||||
Stock option activity | |||||
Granted (in shares) | 469,000 | 208,000 | |||
Weighted average grant date fair value of stock options (in usd per share) | $ 29.35 | $ 16.34 | |||
ROTC Performance-based RSUs | |||||
Stock option activity | |||||
Granted (in shares) | 409,000 | 208,000 | |||
Weighted average grant date fair value of stock options (in usd per share) | $ 18.80 | $ 15.76 | |||
2014 Plan | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Maximum shares authorized (in shares) | 18,000,000 | ||||
Common shares available for issuance (in shares) | 20,000,000 | ||||
Number of additional shares available for issuance (in shares) | 11,900,000 | ||||
Number of shares available for future grant (in shares) | 14,054,000 | ||||
2014 Plan | Non-employee Director | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Aggregate fair market value on awards granted during any calendar year | $ 750,000 |
SHARE-BASED COMPENSATION - Summ
SHARE-BASED COMPENSATION - Summary of Share-based Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Components and classification of share-based compensation expense | ||||
Share-based compensation expense | $ 22 | $ 23 | $ 43 | $ 51 |
Research and development expenses | ||||
Components and classification of share-based compensation expense | ||||
Share-based compensation expense | 2 | 2 | 4 | 4 |
Selling, general and administrative expenses | ||||
Components and classification of share-based compensation expense | ||||
Share-based compensation expense | 20 | 21 | 39 | 47 |
Stock options | ||||
Components and classification of share-based compensation expense | ||||
Share-based compensation expense | 6 | 5 | 11 | 10 |
RSUs | ||||
Components and classification of share-based compensation expense | ||||
Share-based compensation expense | $ 16 | $ 18 | $ 32 | $ 41 |
ACCUMULATED OTHER COMPREHENSI68
ACCUMULATED OTHER COMPREHENSIVE LOSS - Summary of Components of AOCI (Details) - USD ($) $ in Millions | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 |
Accumulated Other Comprehensive Income | |||
Total equity | $ 3,558 | $ 4,635 | $ 5,944 |
Foreign currency translation adjustments | |||
Accumulated Other Comprehensive Income | |||
Total equity | (2,048) | (1,877) | |
Pension and postretirement benefit plan adjustments, net of tax | |||
Accumulated Other Comprehensive Income | |||
Total equity | (20) | (19) | |
Accumulated Other Comprehensive Loss | |||
Accumulated Other Comprehensive Income | |||
Total equity | $ (2,068) | $ (1,896) |
RESEARCH AND DEVELOPMENT - Summ
RESEARCH AND DEVELOPMENT - Summary of Research and Development (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Research and Development [Abstract] | ||||
Product related research and development | $ 84 | $ 86 | $ 167 | $ 172 |
Quality assurance | 10 | 8 | 19 | 18 |
Research and development | $ 94 | $ 94 | $ 186 | $ 190 |
OTHER EXPENSE (INCOME), NET - S
OTHER EXPENSE (INCOME), NET - Summary of Other Expense (Income), Net (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Schedule Of Other Income And Expenses [Line Items] | ||||
Net loss on other sales of assets | $ 0 | $ 23 | $ 0 | $ 25 |
Litigation and other matters | (1) | 33 | 10 | 109 |
Other, net | 1 | (2) | 1 | (1) |
Other income, net | 0 | (19) | 11 | (259) |
Skincare Sale | ||||
Schedule Of Other Income And Expenses [Line Items] | ||||
Gain on sale of business | 0 | 0 | 0 | (319) |
Dendreon Sale | ||||
Schedule Of Other Income And Expenses [Line Items] | ||||
Gain on sale of business | $ 0 | $ (73) | $ 0 | $ (73) |
INCOME TAXES - Narrative (Detai
INCOME TAXES - Narrative (Details) - USD ($) $ in Millions | Aug. 08, 2017 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 |
Schedule Of Income Taxes [Line Items] | ||||||||
Income taxes provision (benefit) | $ 138 | $ (115) | $ (205) | $ 23 | $ (1,129) | |||
Income tax benefit on ordinary income | 170 | 155 | ||||||
Tax expense (benefit) for discrete items | (193) | 974 | ||||||
Income tax charge for internal restructuring transactions | 255 | 635 | ||||||
Income tax benefit related to impairment of intangible assets | 57 | |||||||
Income tax benefits associated with the filing of non-Canadian tax jurisdiction tax returns | 10 | |||||||
Tax benefit related to deferred tax asset on outside basis difference | 1,863 | |||||||
Income tax charge for divestitures | $ 234 | |||||||
Valuation allowance against deferred tax assets | 2,376 | $ 2,001 | 2,376 | $ 2,001 | ||||
Unrecognized tax benefits including interest and penalties | 607 | 598 | 607 | 598 | ||||
Unrecognized tax benefits related to interest and penalties | 43 | 41 | 43 | 41 | ||||
Portion of unrecognized tax benefits, if recognized, would reduce the Company's effective tax rate | $ 271 | $ 271 | ||||||
Tax Act - provisional net tax expense (benefit) | (975) | |||||||
Tax Act - re-measurement of certain deferred tax assets and liabilities, income tax expense (benefit) | (774) | |||||||
Tax Act - one-time transition tax on certain foreign earnings, income tax expense (benefit) | (88) | |||||||
Tax Act - decrease in deferred tax asset attributable to to certain legal accruals, income tax expense (benefit) | $ 10 | |||||||
Tax Act - outside basis differences in certain foreign subsidiaries, income tax expense (benefit) | $ 299 | |||||||
Foreign | Australian Tax Office | ||||||||
Schedule Of Income Taxes [Line Items] | ||||||||
Assessment including penalties and interest | $ 117 |
(LOSS) EARNINGS PER SHARE - Sch
(LOSS) EARNINGS PER SHARE - Schedule of (Loss) Earnings Per Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |||||
Net (loss) income attributable to Bausch Health Companies Inc. | $ (873) | $ (2,581) | $ (38) | $ (3,454) | $ 590 |
Basic weighted-average number of common shares outstanding (in shares) | 351.3 | 350.1 | 351 | 350 | |
Diluted effect of stock options, RSUs and other (in shares) | 0 | 0 | 0 | 0.9 | |
Diluted weighted-average number of common shares outstanding (in shares) | 351.3 | 350.1 | 351 | 350.9 | |
(Loss) earnings per share attributable to Bausch Health Companies Inc.: | |||||
Basic (in usd per share) | $ (2.49) | $ (0.11) | $ (9.84) | $ 1.69 | |
Diluted (in usd per share) | $ (2.49) | $ (0.11) | $ (9.84) | $ 1.68 |
(LOSS) EARNINGS PER SHARE - Dil
(LOSS) EARNINGS PER SHARE - Dilutive Effect of Potential Common Shares (Details) - shares shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Anti-dilutive shares not included in the computation of diluted earnings per share | ||||
Basic weighted-average number of common shares outstanding (in shares) | 351,300 | 350,100 | 351,000 | 350,000 |
Dilutive effect of stock options, RSUs and other (in shares) | 3,200 | 1,300 | 2,900 | |
Diluted weighted average number of shares outstanding (in shares) | 354,500 | 351,400 | 353,900 | |
Stock options | ||||
Anti-dilutive shares not included in the computation of diluted earnings per share | ||||
Dilutive effect of stock options, RSUs and other (in shares) | 5,369 | 8,655 | 6,286 | 8,655 |
LEGAL PROCEEDINGS - Governmenta
LEGAL PROCEEDINGS - Governmental and Regulatory Inquiries (Details) - USD ($) $ in Millions | 1 Months Ended | |
Apr. 30, 2016 | Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | ||
Current accrued loss contingencies | $ 54 | |
Investigation by the State of Texas, State's Medicaid Program | ||
Loss Contingencies [Line Items] | ||
Damages sought | $ 20 |
LEGAL PROCEEDINGS - Securities
LEGAL PROCEEDINGS - Securities and RICO Class Actions and Related Matters (Details) | Dec. 07, 2017insurance_policy_period | Jun. 16, 2017group | Oct. 30, 2015case | Sep. 16, 2016action | Jun. 30, 2018groupaction | Dec. 31, 2015caseaction |
New Jersey | Unfavorable Regulatory Action | ||||||
Loss Contingencies [Line Items] | ||||||
Number of suits filed | 3 | |||||
Canada | ||||||
Loss Contingencies [Line Items] | ||||||
Number of suits filed | case | 6 | |||||
Canada | Violation of Canadian Provincial Securities Legislation | ||||||
Loss Contingencies [Line Items] | ||||||
Number of suits filed | 5 | |||||
Number of suits filed but not yet served | 2 | |||||
US Securities Litigation | New Jersey | ||||||
Loss Contingencies [Line Items] | ||||||
Number of groups of investors filing action | group | 10 | 27 | ||||
US Securities Litigation | New Jersey | Unfavorable Regulatory Action | ||||||
Loss Contingencies [Line Items] | ||||||
Number of suits filed | case | 4 | |||||
Insurance Coverage Lawsuit | ||||||
Loss Contingencies [Line Items] | ||||||
Number of distinct insurance policy periods | insurance_policy_period | 2 |
LEGAL PROCEEDINGS - Antitrust (
LEGAL PROCEEDINGS - Antitrust (Details) | Mar. 31, 2015manufacturer |
Contact Lens Antitrust Class Actions | |
Loss Contingencies [Line Items] | |
Number of manufacturers | 3 |
LEGAL PROCEEDINGS - Product Lia
LEGAL PROCEEDINGS - Product Liability (Details) - case | Mar. 24, 2017 | Jun. 30, 2018 | Dec. 31, 2015 | Dec. 30, 2016 |
Canada | ||||
Loss Contingencies [Line Items] | ||||
Number of suits filed | 6 | |||
Shower to Shower Product Liability Litigation | ||||
Loss Contingencies [Line Items] | ||||
Number of lawsuits (over 160 lawsuits involving Shower to Shower body powder product) | 160 | |||
Shower to Shower Product Liability Litigation | Canada | ||||
Loss Contingencies [Line Items] | ||||
Number of lawsuits (over 160 lawsuits involving Shower to Shower body powder product) | 2 | |||
Shower to Shower Product Liability Litigation | British Columbia | ||||
Loss Contingencies [Line Items] | ||||
Number of lawsuits (over 160 lawsuits involving Shower to Shower body powder product) | 1 | |||
Shower to Shower Product Liability Litigation | Quebec | ||||
Loss Contingencies [Line Items] | ||||
Number of lawsuits (over 160 lawsuits involving Shower to Shower body powder product) | 1 | |||
Johnson & Johnson Talcum Powder Litigation | ||||
Loss Contingencies [Line Items] | ||||
Number of lawsuits (over 160 lawsuits involving Shower to Shower body powder product) | 1 | 5 | 1 | |
Number of suits filed | 1 | |||
Number of cases voluntarily dismissed | 4 |
LEGAL PROCEEDINGS - General Civ
LEGAL PROCEEDINGS - General Civil Actions (Details) - USD ($) $ in Millions | Jun. 29, 2018 | Jul. 21, 2016 | Apr. 30, 2018 |
Afexa Class Action | |||
Loss Contingencies [Line Items] | |||
Leave to appeal response period | 30 days | ||
Arbitration with Alfa Wasserman | |||
Loss Contingencies [Line Items] | |||
Development costs | $ 80 | ||
Damages sought | $ 285 | ||
Doctors Allergy Formula, LLC Litigation | |||
Loss Contingencies [Line Items] | |||
Damages sought | $ 23 |
LEGAL PROCEEDINGS - Completed o
LEGAL PROCEEDINGS - Completed of Inactive Matters (Details) $ in Thousands | May 01, 2018USD ($) | Apr. 12, 2018USD ($) | Mar. 01, 2018USD ($) | Dec. 28, 2017USD ($) | Jun. 30, 2017USD ($) | Apr. 14, 2017claim | Apr. 06, 2015action | Feb. 28, 2018USD ($) | Nov. 30, 2014USD ($) | Jul. 31, 2013manufacturer |
Salix | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Number of suits filed | action | 2 | |||||||||
Allergan Shareholder Class Actions | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Settlement amount | $ 290,000 | |||||||||
Allergan Shareholder Class Actions | Valeant Co Parties [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Settlement amount | $ 96,000 | |||||||||
Payment liability, percent | 33.00% | |||||||||
Allergan Shareholder Class Actions | Pershing Square Parties [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Settlement amount | $ 195,000 | |||||||||
Payment liability, percent | 67.00% | |||||||||
Solodyn Antitrust Class Actions | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Number of settled claims | claim | 2 | |||||||||
Number of manufacturers | manufacturer | 3 | |||||||||
Damages awarded to plaintiff | $ 58,000 | |||||||||
Uceris Arbitration | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Damages awarded from other party | $ 3,000 | |||||||||
Investigation by the California Department of Insurance | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Settlement amount | $ 1,875 | |||||||||
Mimetogen Pharmaceuticals Litigation [Member] | ||||||||||
Loss Contingencies [Line Items] | ||||||||||
Settlement amount | $ 26,000 | $ 20,000 | ||||||||
Damages sought | $ 20,000 |
SEGMENT INFORMATION - Segment R
SEGMENT INFORMATION - Segment Revenues and Profit (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||||
Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2017 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Dec. 31, 2017 | |
Segment reporting information | |||||||
Revenues | $ 2,128 | $ 2,233 | $ 4,123 | $ 4,342 | |||
Amortization of intangible assets | (741) | (623) | (1,484) | (1,258) | |||
Goodwill impairments | 0 | $ (2,213) | $ (312) | 0 | (2,213) | 0 | $ (312) |
Asset impairments | (301) | (85) | (345) | (223) | |||
Restructuring and integration costs | (7) | (18) | (13) | (36) | |||
Acquired in-process research and development costs | 0 | (1) | (1) | (5) | |||
Acquisition-related contingent consideration | 6 | 49 | 4 | 59 | |||
Other (expense) income, net | 0 | 19 | (11) | 259 | |||
Operating (loss) income | (245) | 175 | (2,526) | 386 | |||
Interest income | 3 | 3 | 6 | 6 | |||
Interest expense | (435) | (459) | (851) | (933) | |||
Loss on extinguishment of debt | (48) | 0 | (75) | (64) | |||
Foreign exchange and other | (9) | 39 | 18 | 68 | |||
Loss before (provision for) benefit from income taxes | (734) | (242) | (3,428) | (537) | |||
Bausch Lomb / International | |||||||
Segment reporting information | |||||||
Revenues | 1,209 | 1,223 | 2,312 | 2,357 | |||
Goodwill impairments | $ 0 | $ 0 | |||||
Salix | |||||||
Segment reporting information | |||||||
Revenues | 441 | 387 | 863 | 689 | |||
Ortho Dermatologics | |||||||
Segment reporting information | |||||||
Revenues | 142 | 162 | 283 | 379 | |||
Diversified Products | |||||||
Segment reporting information | |||||||
Revenues | 336 | 461 | 665 | 917 | |||
Operating Segment | |||||||
Segment reporting information | |||||||
Revenues | 2,128 | 2,233 | 4,123 | 4,342 | |||
Operating (loss) income | 959 | 973 | 1,812 | 1,896 | |||
Operating Segment | Bausch Lomb / International | |||||||
Segment reporting information | |||||||
Revenues | 1,209 | 1,223 | 2,312 | 2,357 | |||
Operating (loss) income | 350 | 371 | 647 | 697 | |||
Operating Segment | Salix | |||||||
Segment reporting information | |||||||
Revenues | 441 | 387 | 863 | 689 | |||
Operating (loss) income | 292 | 232 | 564 | 400 | |||
Operating Segment | Ortho Dermatologics | |||||||
Segment reporting information | |||||||
Revenues | 142 | 162 | 283 | 379 | |||
Operating (loss) income | 59 | 68 | 104 | 191 | |||
Operating Segment | Diversified Products | |||||||
Segment reporting information | |||||||
Revenues | 336 | 461 | 665 | 917 | |||
Operating (loss) income | 258 | 302 | 497 | 608 | |||
Corporate | |||||||
Segment reporting information | |||||||
Operating (loss) income | (161) | (139) | (275) | (306) | |||
Segment Reconciling Items | |||||||
Segment reporting information | |||||||
Amortization of intangible assets | (741) | (623) | (1,484) | (1,258) | |||
Goodwill impairments | 0 | 0 | (2,213) | 0 | |||
Asset impairments | (301) | (85) | (345) | (223) | |||
Restructuring and integration costs | (7) | (18) | (13) | (36) | |||
Acquired in-process research and development costs | 0 | (1) | (1) | (5) | |||
Acquisition-related contingent consideration | 6 | 49 | 4 | 59 | |||
Other (expense) income, net | $ 0 | $ 19 | $ (11) | $ 259 |
SEGMENT INFORMATION - Disaggreg
SEGMENT INFORMATION - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 2,128 | $ 2,233 | $ 4,123 | $ 4,342 |
Pharmaceuticals | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 1,029 | 1,140 | 1,995 | 2,221 |
Devices | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 421 | 387 | 813 | 732 |
OTC | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 368 | 380 | 694 | 756 |
Branded and Other Generics | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 282 | 293 | 563 | 567 |
Other revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 28 | 33 | 58 | 66 |
Bausch Lomb/International | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 1,209 | 1,223 | 2,312 | 2,357 |
Bausch Lomb/International | Pharmaceuticals | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 242 | 252 | 445 | 481 |
Bausch Lomb/International | Devices | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 389 | 360 | 752 | 682 |
Bausch Lomb/International | OTC | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 368 | 380 | 694 | 756 |
Bausch Lomb/International | Branded and Other Generics | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 193 | 211 | 384 | 400 |
Bausch Lomb/International | Other revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 17 | 20 | 37 | 38 |
Salix | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 441 | 387 | 863 | 689 |
Salix | Pharmaceuticals | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 441 | 386 | 863 | 688 |
Salix | Devices | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
Salix | OTC | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
Salix | Branded and Other Generics | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
Salix | Other revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 1 | 0 | 1 |
Ortho Dermatologics | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 142 | 162 | 283 | 379 |
Ortho Dermatologics | Pharmaceuticals | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 103 | 126 | 208 | 308 |
Ortho Dermatologics | Devices | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 32 | 27 | 61 | 50 |
Ortho Dermatologics | OTC | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
Ortho Dermatologics | Branded and Other Generics | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
Ortho Dermatologics | Other revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 7 | 9 | 14 | 21 |
Diversified Products | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 336 | 461 | 665 | 917 |
Diversified Products | Pharmaceuticals | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 243 | 376 | 479 | 744 |
Diversified Products | Devices | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
Diversified Products | OTC | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 0 | 0 | 0 | 0 |
Diversified Products | Branded and Other Generics | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | 89 | 82 | 179 | 167 |
Diversified Products | Other revenues | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues | $ 4 | $ 3 | $ 7 | $ 6 |
SEGMENT INFORMATION - Revenue b
SEGMENT INFORMATION - Revenue by Geographic Area (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | $ 2,128 | $ 2,233 | $ 4,123 | $ 4,342 |
U.S. and Puerto Rico | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 1,261 | 1,344 | 2,437 | 2,639 |
China | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 98 | 82 | 182 | 150 |
Canada | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 76 | 76 | 153 | 155 |
Poland | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 52 | 45 | 115 | 96 |
France | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 58 | 53 | 113 | 101 |
Japan | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 55 | 57 | 106 | 108 |
Mexico | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 54 | 52 | 97 | 90 |
Germany | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 42 | 38 | 92 | 80 |
Egypt | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 44 | 43 | 89 | 75 |
Russia | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 40 | 47 | 68 | 91 |
United Kingdom | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 31 | 25 | 58 | 50 |
Italy | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 23 | 21 | 45 | 39 |
Spain | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | 23 | 21 | 44 | 38 |
Other | ||||
Revenues from External Customers and Long-Lived Assets [Line Items] | ||||
Revenues | $ 271 | $ 329 | $ 524 | $ 630 |
SEGMENT INFORMATION - Major Cus
SEGMENT INFORMATION - Major Customers (Details) - Revenues - Customer Concentration | 6 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
McKesson Corporation (including McKesson Specialty) | ||
Revenue, Major Customer [Line Items] | ||
Concentration risk percentage | 17.00% | 19.00% |
AmerisourceBergen Corporation | ||
Revenue, Major Customer [Line Items] | ||
Concentration risk percentage | 18.00% | 14.00% |
Cardinal Health, Inc. | ||
Revenue, Major Customer [Line Items] | ||
Concentration risk percentage | 13.00% | 14.00% |