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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Ireland
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98-1088325
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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Title of each class
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Name of each exchange on which registered
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Ordinary shares, par value $0.20 per share
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New York Stock Exchange
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Large accelerated filer
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Accelerated filer
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Non-accelerated filer
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(Do not check if smaller reporting company)
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Smaller reporting company
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PART I
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Item 1.
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Business.
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Item 1A.
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Risk Factors.
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Item 1B.
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Unresolved Staff Comments.
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Item 2.
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Properties.
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Item 3.
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Legal Proceedings.
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Item 4.
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Mine Safety Disclosures.
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PART II
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Item 5.
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Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
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Item 6.
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Selected Financial Data.
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Item 7.
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Management's Discussion and Analysis of Financial Condition and Results of Operations.
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Item 7A.
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Quantitative and Qualitative Disclosures About Market Risk.
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Item 8.
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Financial Statements and Supplementary Data.
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Item 9.
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Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.
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Item 9A.
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Controls and Procedures.
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Item 9B.
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Other Information.
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PART III
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Item 10.
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Directors, Executive Officers and Corporate Governance.
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Item 11.
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Executive Compensation.
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Item 12.
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Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
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Item 13.
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Certain Relationships and Related Transactions, and Director Independence.
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Item 14.
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Principal Accounting Fees and Services.
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PART IV
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Item 15.
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Exhibits, Financial Statement Schedules.
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Signatures
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Exhibit Index
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Item 1.
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Business.
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•
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Specialty Pharmaceuticals
produces and markets branded pharmaceuticals and biopharmaceuticals, specialty generic pharmaceuticals and active pharmaceutical ingredients ("API") consisting of biologics, medicinal opioids, synthetic controlled substances, acetaminophen and other active ingredients; and
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•
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Global Medical Imaging
develops, manufactures and markets contrast media and delivery systems ("CMDS") and radiopharmaceuticals (nuclear medicine).
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•
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Ability to successfully execute strategies to drive growth.
We became an independent public company in June 2013. In March 2014, the Company acquired Cadence Pharmaceuticals, Inc. ("Cadence"), a biopharmaceutical company focused on commercializing products principally for use in the hospital setting, for total consideration of approximately
$1.3 billion
("the Cadence Acquisition"). In August 2014, we acquired Questcor Pharmaceuticals, Inc. ("Questcor"), a high-growth biopharmaceutical company, for total consideration of approximately $5.9 billion ("the Questcor Acquisition"). Over the same period, we successfully completed the integration of Cadence, commenced the integration of Questcor and took restructuring actions, all of which are expected to drive efficiencies. These actions further diversified Mallinckrodt, significantly increasing our scale, revenues, profitability and cash flow.
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•
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Expertise in highly regulated raw materials and strong regulatory relationships.
We have expertise in the acquisition and importation of highly regulated raw materials, such as opioids, other controlled substances and radioisotopes. For example, in calendar 2013, we estimated we received approximately 26% of the U.S. Drug Enforcement Administration's ("DEA") total annual quota for controlled substances that we manufacture. Based on IMS Health data for the same period, our Generics business had an approximately 30% market share of DEA Schedules II and III opioid and oral solid dose medications. The acquisition of certain raw materials and the processing of them into finished products requires a close collaboration with a wide variety of regulatory authorities including the DEA, U.S. Food and Drug Administration ("FDA"), U.S. Department of Agriculture ("USDA"), U.S. Nuclear Regulatory Commission ("NRC"), European Medicines Agency and Irish Medicines Board, among many others. We have a long history of working closely with regulatory agencies to ensure ongoing, reliable access to these highly regulated materials.
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•
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Specialized chemistry, development and formulation expertise which supports our operations.
We have specialized chemistry expertise in the formulation of new drug combinations, reformulation of existing drugs, and manufacture of controlled substances into a wide range of products, such as tablets, capsules, oral liquids, injectable and intrathecal products.
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•
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Distinctive high-quality manufacturing and distribution skills with vertical integration where there are competitive advantages.
We have expertise in the manufacturing of complex substances including those that come from naturally derived sources. Our manufacturing and supply chain capabilities enable highly efficient controlled substance tableting, packaging and distribution. We own one of the world's largest DEA Schedule C-II vault storage capacities for raw materials, intermediates and finished dosages. In our Global Medical Imaging segment, we have the capability to process Mo-99 for use in our Ultra-Technekow DTE generators and to manufacture cyclotron-derived isotopes such as thallium-201, indium-111, gallium-67, germanium-68 and iodine-123. In addition, we produce the large-volume terminally sterilized pre-filled plastic syringes that fit into our power injectors. Where appropriate, we have also pursued selective vertical integration initiatives to ensure our manufacturing and supply chain benefit from cost and productivity efficiencies, such as using several of our API products to provide the raw materials for some of our generic products.
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•
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Diversified business model with increasing shift towards high-margin Specialty Pharmaceuticals business with high cash flow conversion.
We have a diverse portfolio across our two different reporting segments, Specialty Pharmaceuticals and Global Medical Imaging. In the fourth quarter of fiscal 2014 net sales from our Specialty Pharmaceuticals segment represented 72.6% of net sales, excluding sales to our former parent, compared with 57.1% in the fourth quarter of fiscal 2013. We expect this percentage to increase in fiscal 2015 due to the inclusion of full year results from our fiscal 2014 acquisitions. These acquisitions have also increased the Specialty Phamaceuticals segment operating income from 25.3% in the fourth quarter of fiscal 2013 to 39.4% in the fourth quarter of fiscal 2014. The increased revenues and segment operating income positions us for strong cash flow generation, enabling us to potentially decrease leverage over time.
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•
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An extensive portfolio of generic products and controlled substance API for pain.
Our Generics and API businesses have a strong position in the controlled substance generics market. Our generics products are focused on pain and ADHD while our APIs are for a broad range of products. We believe this business offers the broadest product line of opioid and other controlled substances available (primarily DEA Schedules II and III), and we focus in a number of therapeutic areas with high technical barriers, limited competition and long product life-cycles.
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•
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Acthar
is an injectable biopharmaceutical drug approved by the FDA for use in 19 indications. The product currently generates substantially all of its net sales from nine of the on-label indications including the treatment of proteinuria in nephrotic syndrome of the idiopathic type ("NS"); the treatment of acute exacerbations of multiple sclerosis ("MS") in adults; the treatment of infantile spasms ("IS"), in infants and children under two years of age; and the treatment of certain rheumatology related conditions, including the treatment of the rare and closely related neuromuscular disorders, dermatomyositis and polymyositis. We may initiate commercial efforts for other on-label indications where there is high unmet medical need. The currently approved indications of Acthar are not subject to patent or other exclusivity, with the exception of IS which was granted orphan drug status from the FDA upon its approval in October 2010.
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•
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Ofirmev
is a proprietary intravenous formulation of acetaminophen indicated for the management of mild to moderate pain, the management of moderate to severe pain with adjunctive opioid analgesics and the reduction of fever. This product is marketed to hospitals and ambulatory surgical centers and provides us with an expanded presence in these channels. Ofirmev is protected by two Orange Book-listed patents that expire in August 2017 and June 2021 and we have the potential to obtain an additional six months of exclusivity for each patent if the FDA grants pediatric exclusivity. Settlement agreements have been reached in association with certain challenges to these patents, which allow for generic competitors to Ofirmev in December 2020, or earlier under certain circumstances.
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•
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Xartemis XR
is the first and only extended-release oral combination of oxycodone and acetaminophen. Xartemis XR is approved for the management of acute pain severe enough to require opioid treatment and in patients for whom alternative treatment options are ineffective, not tolerated or would otherwise be inadequate. In February 2014, we were granted a patent from the USPTO, which contains composition claims directed to unique design, formulation, pharmacokinetic and release characteristics of Xartemis XR. Xartemis XR received FDA approval and was launched in March 2014.
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•
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Exalgo
, which was acquired in June 2009, is the only branded long-acting, once-daily form of hydromorphone in the U.S. market. In August 2012, the FDA approved a 32 mg tablet of Exalgo, which further expanded the patient population that Exalgo can effectively treat with a single daily dose. The 8 mg, 12 mg and 16 mg dosages of Exalgo were approved by the FDA in March 2010 for the treatment of chronic pain in opioid-tolerant patients requiring continuous around-the-clock opioid analgesia for an extended amount of time, and have shown significant prescription growth since launch in April 2010. Our exclusivity period for Exalgo has expired and generic competition entered the market beginning in May 2014. In anticipation of this loss of exclusivity, we launched a generic form of Exalgo in May 2014. We expect sales of Exalgo, across both the branded and authorized generic product, to decrease in fiscal 2015 compared with net sales in fiscal 2014.
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•
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hydrocodone (API) and hydrocodone-containing tablets;
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•
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oxycodone (API) and oxycodone-containing tablets;
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•
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methylphenidate HCl extended-release tablets USP (CII) ("Methylphenidate ER") and;
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•
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other controlled substances, including acetaminophen (API) products.
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•
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Optiray
(ioversol injection) is a low osmolar, lower viscosity and non-ionic organically bound solution of iodine with a broad range of indications in CT imaging procedures, including peripheral and coronary arteriography, angiography and venography. Optiray is available in a Radio Frequency Identification ("RFID")-enabled Ultraject pre-filled syringe that, when combined with a RFID-enabled Optivantage DH CT Contrast Delivery System (a medical device used to synchronize the injection of contrast media with the CT scanner), provides a safer and more efficient method of delivering contrast media. Sales of our Optiray product represent
11%
,
14%
and
17%
of our total net sales in fiscal
2014
,
2013
and
2012
, respectively. Optiray has been on the market for over 25 years. The high capital intensity in manufacturing API for Optiray products and our significant scale have contributed to the longevity of this product.
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•
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Optimark
(gadoversetamide injection) is a non-ionic extracellular Gadolinium-Based Contrast Agent ("GBCA") indicated for use with MRI in patients where abnormal vascularity of the brain or liver is suspected. It is the only GBCA approved by the FDA for administration by power injector and is available in pre-filled syringes to help reduce medication errors and improve patient safety.
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•
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Ultra-Technekow DTE
is a dry-ship, top eluting Tc-99m radioisotope generator that provides an on-site isotope source of Tc-99m solution that is combined by a nuclear pharmacist with various "cold" kit targeting agents to prepare an individualized radiopharmaceutical dose. The prepared Tc-99m radiopharmaceutical is used in procedures using SPECT. SPECT radiopharmaceutical scans account for approximately
80%
of all radiopharmaceutical scans and are used in a number of applications, including myocardial perfusion imaging and bone scans. Tc-99m is a decay product of Mo-99, the parent isotope contained in the Tc-99m generator. We are one of only a limited number of manufacturers of Tc-99m generators in North America and Europe, and the only one on either continent that has its own Mo-99 processing facility, which provides cost and raw material supply advantages.
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•
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Octreoscan™
(kit for the preparation of indium In-111 pentetreotide) is a unique molecular imaging agent used for the localization of primary and metastatic neuroendocrine tumors bearing somatostatin receptors. The product was approved by the FDA in June 1994 and is sold primarily in the U.S. and Europe. There are three Orange Book-listed patents for the drug product and usage in detection of neuroendocrine tumors. The last patent expires in September 2017.
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•
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for contrast imaging agents: GE Healthcare, a division of General Electric Company, Bracco Imaging S.p.A., Bayer AG and Guerbet Group;
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•
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for delivery systems: Nemoto & Co, Ltd.;
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•
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for CMDS: Bayer AG and Bracco Imaging S.p.A.;
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•
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for radiopharmaceutical generators sold in the U.S.: Lantheus Medical Imaging, Inc.;
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•
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for radiopharmaceutical generators sold in Europe: GE Healthcare, IBA Group, and POLATOM; and
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•
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for radiopharmaceutical SPECT "cold" kits: Lantheus Medical Imaging, Inc., GE Healthcare, Bracco Imaging S.p.A. and IBA Group.
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Completion of formulation, laboratory and animal testing in accordance with GLP that fully characterizes the drug product from a pre-clinical perspective and provides preliminary evidence that the drug product is safe to test in human beings;
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•
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Filing with the FDA an Investigational New Drug Application that will permit the conduct of clinical trials (testing in human beings under adequate and well-controlled conditions);
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•
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Designing and conducting clinical trials to show the safety and efficacy of the drug product in accordance with GCP;
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•
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Submitting the NDA for FDA review, which provides a complete characterization of the drug product;
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•
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Satisfactory completion of FDA pre-approval inspections regarding the conduct of the clinical trials and the manufacturing processes at the designated facility in accordance with cGMP;
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•
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If applicable, satisfactory completion of a FDA Advisory Committee meeting in which the Agency requests help from outside experts in evaluating the NDA;
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•
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Final FDA approval of the full prescribing information, labeling and packaging of the drug product; and
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•
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Ongoing monitoring and reporting of adverse events related to the drug product, implementation of a REMS program, if applicable, and conduct of any required Phase IV studies.
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•
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Phase I trials are typically small (less than 100 healthy volunteers) and are designed to determine the toxicity and maximum safe dose of the drug product.
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•
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Phase II trials usually involve 100 to 300 participants and are designed to determine whether the drug product produces any clinically significant effects in patients with the intended disease or condition. If the results of these trials show promise, then a larger Phase III trial may be conducted.
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•
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Phase III trials are often multi-institution studies that involve a large number of participants and are designed to show efficacy. Phase III (and some Phase II) trials are designed to be pivotal, or confirmatory trials. The goal of a pivotal trial is to establish the safety and efficacy of a drug product by eliminating biases and increasing statistical power.
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•
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In some cases, the FDA requires Phase IV trials, which are usually performed after the NDA has been approved. Such post-marketing surveillance is intended to obtain more information about the risks of harm, benefits and optimal use of the drug product by observing the results of the drug product in a large number of patients.
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Fiscal Year
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|||||||
|
2014
|
|
2013
|
|
2012
|
|||
Cardinal Health, Inc.
|
18
|
%
|
|
18
|
%
|
|
19
|
%
|
McKesson Corporation
|
17
|
%
|
|
15
|
%
|
|
14
|
%
|
Amerisource Bergen Corporation
|
11
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%
|
|
9
|
%
|
|
9
|
%
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U.S.
|
78
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%
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Europe
|
13
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%
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Canada
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9
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%
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Name
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Age
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Title
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Mark Trudeau
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53
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President, Chief Executive Officer and Director
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Matthew Harbaugh
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44
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Senior Vice President and Chief Financial Officer
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Peter Edwards
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53
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Senior Vice President and General Counsel
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Meredith Fischer
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61
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Senior Vice President, Communications and Public Affairs
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Raymond Furey
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46
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Senior Vice President and Chief Compliance Officer
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Sandra Hatten
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57
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Senior Vice President, Quality and Regulatory Compliance
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Hugh O'Neill
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51
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Senior Vice President and President of Specialty Pharmaceuticals
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Gary Phillips
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48
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Senior Vice President and President of Autoimmune and Rare Diseases
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Mario Saltarelli
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54
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Senior Vice President and Chief Science Officer
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Frank Scholz
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45
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Senior Vice President, Global Operations
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Ian Watkins
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52
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Senior Vice President and Chief Human Resources Officer
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Item 1A.
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Risk Factors.
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•
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developing, testing and manufacturing products in compliance with regulatory and quality standards in a timely manner;
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•
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receiving requisite regulatory approvals for such products in a timely manner, or at all;
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the availability, on commercially reasonable terms, of raw materials, including API and other key ingredients;
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developing and commercializing a new product is time-consuming, costly and subject to numerous factors, including legal actions brought by our competitors, that may delay or prevent the development and commercialization of new products;
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•
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unanticipated costs;
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•
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payment of prescription drug user fees to the FDA to defray the costs of review and approval of marketing applications for branded and generic drugs;
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•
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experiencing delays as a result of limited resources at the FDA or other regulatory authorities;
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•
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changing review and approval policies and standards at the FDA or other regulatory authorities;
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•
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potential delays in the commercialization of generic products by up to 30 months resulting from the listing of patents with the FDA; and
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•
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effective execution of the product launches in a manner that is consistent with anticipated costs.
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•
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our ability to increase market demand for products through our own marketing and support of our sales force;
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our ability to implement and maintain pricing actions and continue to maintain or increase market demand for these products;
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•
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our ability to maintain confidentiality of the proprietary know-how and trade secrets relating to Acthar;
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•
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our ability to maintain and defend the patent protection and regulatory exclusivity of Ofirmev;
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•
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our ability to continue to procure a supply of Acthar and Ofirmev from internal and third-party manufacturers in sufficient quantities and at acceptable quality and pricing levels in order to meet commercial demand;
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•
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our ability to maintain fees and discounts payable to the wholesalers and distributors and group purchasing organizations, at commercially reasonable levels;
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•
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whether the Federal Trade Commission ("FTC"), Department of Justice ("DOJ") or third parties seek to challenge and are successful in challenging patents or patent-related settlement agreements or our sales and marketing practices;
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•
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warnings or limitations that may be required to be added to FDA-approved labeling;
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•
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the occurrence of adverse side effects related to or emergence of new information related to the therapeutic efficacy of these products, and any resulting product liability claims or product recalls; and
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•
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our ability to achieve hospital formulary acceptance, and maintain reimbursement levels by third-party payors.
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•
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the generation, storage, use and transportation of hazardous materials;
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emissions or discharges of substances into the environment;
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investigation and remediation of hazardous substances or materials at various sites;
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chemical constituents in products and end-of-life disposal, mandatory recycling and take-back programs; and
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•
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the health and safety of our employees.
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potentially longer payment cycles and difficulties in enforcing agreements and collecting receivables through certain non-U.S. legal systems;
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political and economic instability;
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potentially adverse tax consequences, tariffs, customs charges, bureaucratic requirements and trade barriers;
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failure to successfully implement our new non-U.S. operating structure, and difficulties and costs of staffing and managing non-U.S. operations;
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exposure to global economic conditions; and
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•
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exposure to potentially unfavorable movements in foreign currency exchange rates associated with international net sales and operating expense and intercompany debt financings.
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•
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Prior to the Separation, our business was operated by Covidien as part of its broader corporate organization, rather than as an independent company, particularly in relation to our non-U.S. locations. Covidien or one of its affiliates performed various corporate functions for us, such as accounting, information technology and finance. Covidien continued to provide some of these functions to us for a period of time following the Separation pursuant to a transition services agreement. Our historical financial results for periods prior to the Separation include allocations of corporate expenses from Covidien for such functions which expenses are less than the expenses we have incurred operating as an independent, publicly-traded company following the Separation.
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•
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We incur additional expenses as a result of being an independent, publicly-traded company including, among other things, directors and officers liability insurance, director fees, reporting fees with the SEC, New York Stock Exchange listing fees, transfer agent fees, and increased auditing and legal fees. These expenses are significant and may negatively impact our results of operations as compared to periods prior to the Separation.
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•
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Our financial results for periods prior to the Separation include costs incurred to separate Mallinckrodt from Covidien, which primarily related to legal, accounting, tax and other professional fees. We continue to incur separation related costs as a result of our transition services agreement with Covidien, as well as other transitional costs, such as costs to implement our own information and accounting systems. Our future separation related costs may fluctuate based on the nature and timing of our separation activities.
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•
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We have made significant investments to replicate or outsource from other providers certain facilities, systems, infrastructure and personnel that were formerly available to us through Covidien. The initiatives to develop our independent operational and administrative infrastructure have been costly to implement, and we may not be able to operate our business efficiently or at comparable costs, which may cause our profitability to decline.
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•
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Prior to the Separation, our working capital and capital for our general corporate purposes had been provided as part of the corporate-wide cash management policies of Covidien. We have obtained and may need to obtain additional financing from lenders, through public offerings or private placements of debt or equity securities, strategic relationships or other arrangements.
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•
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The cost of debt or equity capital for our business may be significantly different than that of Covidien.
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•
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making it more difficult for us to satisfy our obligations with respect to our debt;
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•
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limiting our ability to obtain additional financing in the future for working capital, capital expenditures, acquisitions or other corporate requirements;
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•
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requiring a substantial portion of our cash flows to be dedicated to debt service payments instead of other purposes, thereby reducing the amount of cash flows available for working capital, capital expenditures, acquisitions and other general corporate purposes;
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•
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making us more vulnerable to economic downturns and limiting our ability to withstand competitive pressures;
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•
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limiting our flexibility in planning for and reacting to changes in the industry in which we compete;
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•
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limiting our ability to refinance our indebtedness on terms acceptable to us or at all;
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•
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imposing restrictive covenants on our operations;
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•
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placing us at a competitive disadvantage to other less leveraged competitors; and
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•
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increasing our costs of borrowing.
|
•
|
incur, assume or guarantee additional indebtedness;
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•
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declare or pay dividends or make other distributions with respect to on or purchase or otherwise acquire or retire for value, equity interests
|
•
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make any principal payment on, or redeem or repurchase, subordinated debt;
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•
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make loans, advances or other investments;
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•
|
sell or otherwise dispose of assets, including capital stock of subsidiaries;
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•
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incur liens;
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•
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enter into transactions with affiliates;
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•
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enter into sale and leaseback transactions; and
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•
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consolidate or merge with or into, or sell all or substantially all of our assets to, another person.
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•
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limited in how we conduct our business;
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•
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unable to raise additional debt or equity financing to operate during general economic or business downturns; or
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•
|
unable to compete effectively, execute our growth strategy or take advantage of new business opportunities.
|
•
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actual or anticipated fluctuations in our results of operations;
|
•
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changes in earnings estimated by securities analysts or our ability to meet those estimates;
|
•
|
perceived impacts to our results from acquisitions of products, licenses rights or businesses;
|
•
|
the operating and share price performance of comparable companies;
|
•
|
actual or anticipated sales of our ordinary shares;
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•
|
changes to the regulatory and legal environment in which we operate; and
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•
|
U.S. and worldwide economic conditions.
|
•
|
provisions of our articles of association which allow our board of directors to adopt a shareholder rights plan (commonly known as a "poison pill") upon such terms and conditions as the board of directors deems expedient and in the best interests of our company;
|
•
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a provision of our articles of association which generally prohibits us from engaging in a business combination with an interested shareholder for a period of three years following the date the person became an interested shareholder, subject to certain exceptions;
|
•
|
rules regarding how shareholders may present proposals or nominate directors for election at shareholder meetings;
|
•
|
the right of our board of directors to issue preferred shares without shareholder approval in certain circumstances, subject to applicable law; and
|
•
|
the ability of our board of directors to fill vacancies on our board of directors in certain circumstances.
|
Item 1B.
|
Unresolved Staff Comments.
|
Item 2.
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Properties.
|
Item 3.
|
Legal Proceedings.
|
Item 4.
|
Mine Safety Disclosures.
|
Item 5.
|
Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
|
|
|
FY2014
|
|
FY2013
|
||||||||||
|
|
High
|
Low
|
|
High
|
Low
|
||||||||
First Quarter
|
|
$
|
53.47
|
|
$
|
42.01
|
|
|
$
|
—
|
|
$
|
—
|
|
Second Quarter
|
|
$
|
72.81
|
|
$
|
50.70
|
|
|
$
|
—
|
|
$
|
—
|
|
Third Quarter
|
|
$
|
82.70
|
|
$
|
60.28
|
|
|
$
|
—
|
|
$
|
—
|
|
Fourth Quarter
|
|
$
|
90.00
|
|
$
|
68.12
|
|
|
$
|
47.16
|
|
$
|
41.51
|
|
Period
|
|
Total Number of Shares Purchased
|
|
Average Price Paid per Share
|
|
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs
|
|
Minimum Approximate Dollar Value of Shares that May Yet Be Purchased Under Publicly Announced Plans or Programs
|
|||||
6/28/2014 - 7/25/2014
|
|
1,103
|
|
|
$
|
76.32
|
|
|
—
|
|
|
—
|
|
7/26/2014 - 8/29/2014
|
|
77
|
|
|
$
|
77.31
|
|
|
—
|
|
|
—
|
|
8/30/2014 - 9/26/2014
|
|
196,724
|
|
|
$
|
78.56
|
|
|
—
|
|
|
—
|
|
6/26/2014 - 9/26/2014
|
|
197,904
|
|
|
$
|
78.55
|
|
|
|
|
|
|
|
Mallinckrodt
|
|
Russell 1000 Index
|
|
NYSE Pharmaceutical Index
|
||||||
June 17, 2013
|
|
$
|
100.00
|
|
|
$
|
100.00
|
|
|
$
|
100.00
|
|
June 28, 2013
|
|
100.96
|
|
|
98.07
|
|
|
96.14
|
|
|||
September 27, 2013
|
|
96.82
|
|
|
104.02
|
|
|
100.18
|
|
|||
December 27, 2013
|
|
114.20
|
|
|
112.98
|
|
|
108.36
|
|
|||
March 28, 2014
|
|
139.78
|
|
|
114.23
|
|
|
115.05
|
|
|||
June 27, 2014
|
|
173.67
|
|
|
120.48
|
|
|
121.71
|
|
|||
September 26, 2014
|
|
200.00
|
|
|
121.42
|
|
|
124.26
|
|
Item 6.
|
Selected Financial Data.
|
(1)
|
Fiscal 2011 included 53 weeks. All other fiscal years presented include 52 weeks.
|
(2)
|
Fiscal 2014 and 2013 each include a $5.0 million charge related to milestone payments related to the acceptance of pipeline products for filing with the FDA.
|
(3)
|
Fiscal 2013 and 2012 include costs related to the build-out of our corporate infrastructure of
$70.6 million
and
$10.7 million
, respectively. Fiscal 2014, 2013, 2012 and 2011 include separation related costs of
$9.6 million
,
$74.2 million
,
$25.5 million
and $2.9 million, respectively. Fiscal 2014, 2013, 2012, 2011 and 2010 include restructuring charges, net, of
$128.6 million
,
$33.2 million
,
$11.2 million
, $8.4 million and $11.5 million, respectively. Fiscal 2014 includes
$355.6 million
of non-restructuring impairment charges, $49.6 million of environmental and legal charges and $65.1 million of transaction costs associated with the Cadence Acquisition and the Questcor Acquisition. Fiscal 2010 includes product liability charges of $31.3 million.
|
(4)
|
Fiscal 2013, 2012, 2011, and 2010 include expense allocations from Covidien of
$39.6 million
,
$49.2 million
,
$56.3 million
and
$60.8 million
, respectively, which relate to finance, legal, information technology, human resources, communications, employee benefits and incentives, insurance and share-based compensation. Effective with the legal separation from Covidien on June 28, 2013, we have assumed responsibility for all of these functions and related costs and anticipate our costs as an independent, publicly-traded company will be higher than those allocated to us from Covidien.
|
(5)
|
The computation of basic and diluted earnings per share assumes that the number of shares outstanding for periods prior to June 28, 2013 was equal to the number of ordinary shares of Mallinckrodt outstanding on June 28, 2013, immediately following the distribution of one ordinary share of Mallinckrodt for every eight ordinary shares of Covidien.
|
Item 7.
|
Management's Discussion and Analysis of Financial Condition and Results of Operations.
|
•
|
Specialty Pharmaceuticals
produces and markets branded pharmaceuticals and biopharmaceuticals, specialty generic pharmaceuticals and active pharmaceutical ingredients ("API") consisting of biologics, medicinal opioids, synthetic controlled substances, acetaminophen and other active ingredients; and
|
•
|
Global Medical Imaging
develops, manufactures and markets contrast media and delivery systems ("CMDS") and radiopharmaceuticals (nuclear medicine).
|
|
Fiscal Year
|
|
|
|||||||
|
2014
|
|
2013
|
|
Percentage
Change
|
|||||
U.S.
|
$
|
1,899.8
|
|
|
$
|
1,518.7
|
|
|
25.1
|
%
|
Europe, Middle East and Africa
|
394.0
|
|
|
404.3
|
|
|
(2.5
|
)
|
||
Other
|
246.6
|
|
|
281.5
|
|
|
(12.4
|
)
|
||
Net sales
|
$
|
2,540.4
|
|
|
$
|
2,204.5
|
|
|
15.2
|
|
|
Fiscal Year
|
|
|
|||||||
|
2013
|
|
2012
|
|
Percentage
Change
|
|||||
U.S.
|
$
|
1,518.7
|
|
|
$
|
1,350.2
|
|
|
12.5
|
%
|
Europe, Middle East and Africa
|
404.3
|
|
|
411.0
|
|
|
(1.6
|
)
|
||
Other
|
281.5
|
|
|
295.0
|
|
|
(4.6
|
)
|
||
Net sales
|
$
|
2,204.5
|
|
|
$
|
2,056.2
|
|
|
7.2
|
|
•
|
Brands
include branded pharmaceutical drugs, primarily for pain management, and a biopharmaceutical drug for autoimmune and rare diseases.
|
•
|
Generics and API
produces generic pharmaceutical products (including those to treat ADHD and addiction), medicinal opioids, synthetic controlled substances, acetaminophen and other active ingredients.
|
•
|
Contrast Media and Delivery Systems
develops, manufactures and markets contrast media for diagnostic imaging applications, and power injectors to allow delivery of contrast media.
|
•
|
Nuclear Imaging
manufactures and markets radioactive isotopes and associated pharmaceuticals used for the diagnosis and treatment of disease.
|
|
Fiscal Year
|
|
|
|||||||
|
2014
|
|
2013
|
|
Percentage
Change
|
|||||
Specialty Pharmaceuticals
|
$
|
1,612.9
|
|
|
$
|
1,217.6
|
|
|
32.5
|
%
|
Global Medical Imaging
|
881.5
|
|
|
935.7
|
|
|
(5.8
|
)
|
||
Net sales of operating segments
|
2,494.4
|
|
|
2,153.3
|
|
|
15.8
|
|
||
Other
(1)
|
46.0
|
|
|
51.2
|
|
|
(10.2
|
)
|
||
Net sales
|
$
|
2,540.4
|
|
|
$
|
2,204.5
|
|
|
15.2
|
|
(1)
|
Represents products that were sold to Covidien.
|
|
Fiscal Year
|
|
|
|||||||
|
2014
|
|
2013
|
|
Percentage
Change
|
|||||
U.S.
|
$
|
1,485.0
|
|
|
$
|
1,097.9
|
|
|
35.3
|
%
|
Europe, Middle East and Africa
|
103.4
|
|
|
104.1
|
|
|
(0.7
|
)
|
||
Other
|
24.5
|
|
|
15.6
|
|
|
57.1
|
|
||
Net sales
|
$
|
1,612.9
|
|
|
$
|
1,217.6
|
|
|
32.5
|
|
|
Fiscal Year
|
|
|
|||||||
|
2014
|
|
2013
|
|
Percentage Change
|
|||||
Methylphenidate ER
|
$
|
209.6
|
|
|
$
|
148.3
|
|
|
41.3
|
%
|
Oxycodone (API) and oxycodone-containing tablets
|
155.2
|
|
|
139.0
|
|
|
11.7
|
|
||
Hydrocodone (API) and hydrocodone-containing tablets
|
99.4
|
|
|
140.0
|
|
|
(29.0
|
)
|
||
Other controlled substances
|
584.5
|
|
|
443.3
|
|
|
31.9
|
|
||
Other
|
150.7
|
|
|
140.6
|
|
|
7.2
|
|
||
Specialty Generics and API
|
1,199.4
|
|
|
1,011.2
|
|
|
18.6
|
|
||
Exalgo
|
76.1
|
|
|
126.1
|
|
|
(39.7
|
)
|
||
Offirmev
|
124.4
|
|
|
—
|
|
|
—
|
|
||
Acthar
|
122.9
|
|
|
—
|
|
|
—
|
|
||
Other
|
90.1
|
|
|
80.3
|
|
|
12.2
|
|
||
Brands
|
413.5
|
|
|
206.4
|
|
|
100.3
|
|
||
Specialty Pharmaceuticals
|
$
|
1,612.9
|
|
|
$
|
1,217.6
|
|
|
32.5
|
|
|
Fiscal Year
|
|
|
|||||||
|
2014
|
|
2013
|
|
Percentage
Change
|
|||||
U.S.
|
$
|
414.7
|
|
|
$
|
418.2
|
|
|
(0.8
|
)%
|
Europe, Middle East and Africa
|
290.6
|
|
|
300.2
|
|
|
(3.2
|
)
|
||
Other
|
176.2
|
|
|
217.3
|
|
|
(18.9
|
)
|
||
Net sales
|
$
|
881.5
|
|
|
$
|
935.7
|
|
|
(5.8
|
)
|
|
Fiscal Year
|
|
|
|||||||
|
2014
|
|
2013
|
|
Percentage
Change |
|||||
Optiray
|
$
|
284.0
|
|
|
$
|
318.5
|
|
|
(10.8
|
)%
|
Other
|
165.8
|
|
|
179.6
|
|
|
(7.7
|
)
|
||
Contrast Media and Delivery Systems
|
449.8
|
|
|
498.1
|
|
|
(9.7
|
)
|
||
Nuclear Imaging
|
431.7
|
|
|
437.6
|
|
|
(1.3
|
)
|
||
Global Medical Imaging
|
$
|
881.5
|
|
|
$
|
935.7
|
|
|
(5.8
|
)
|
|
Fiscal Year
|
||||||||||
|
2014
|
|
2013
|
||||||||
Specialty Pharmaceuticals
|
$
|
566.8
|
|
35.1
|
%
|
|
$
|
311.7
|
|
25.6
|
%
|
Global Medical Imaging
|
47.1
|
|
5.3
|
|
|
112.3
|
|
12.0
|
|
||
Segment operating income
|
613.9
|
|
24.6
|
|
|
424.0
|
|
19.7
|
|
||
Unallocated amounts:
|
|
|
|
|
|
||||||
Corporate and allocated expenses
|
(241.4
|
)
|
|
|
(133.8
|
)
|
|
||||
Intangible asset amortization
|
(162.3
|
)
|
|
|
(35.4
|
)
|
|
||||
Restructuring and related charges, net
(1)
|
(129.1
|
)
|
|
|
(35.8
|
)
|
|
||||
Non-restructuring impairment charges
|
(355.6
|
)
|
|
|
—
|
|
|
||||
Separation costs
|
(9.6
|
)
|
|
|
(74.2
|
)
|
|
||||
Total operating (loss) income
|
$
|
(284.1
|
)
|
|
|
$
|
144.8
|
|
|
(1)
|
Includes restructuring-related accelerated depreciation of
$0.5 million
and
$2.6 million
for fiscal
2014
and
2013
, respectively.
|
|
Fiscal Year
|
|
|
|||||||
|
2013
|
|
2012
|
|
Percentage
Change
|
|||||
Specialty Pharmaceuticals
|
$
|
1,217.6
|
|
|
$
|
1,005.2
|
|
|
21.1
|
%
|
Global Medical Imaging
|
935.7
|
|
|
996.8
|
|
|
(6.1
|
)
|
||
Net sales of operating segments
|
2,153.3
|
|
|
2,002.0
|
|
|
7.6
|
|
||
Other
(1)
|
51.2
|
|
|
54.2
|
|
|
(5.5
|
)
|
||
Net sales
|
$
|
2,204.5
|
|
|
$
|
2,056.2
|
|
|
7.2
|
|
(1)
|
Represents products that were sold to Covidien.
|
|
Fiscal Year
|
|
|
|||||||
|
2013
|
|
2012
|
|
Percentage
Change
|
|||||
U.S.
|
$
|
1,097.9
|
|
|
$
|
880.6
|
|
|
24.7
|
%
|
Europe, Middle East and Africa
|
104.1
|
|
|
108.7
|
|
|
(4.2
|
)
|
||
Other
|
15.6
|
|
|
15.9
|
|
|
(1.9
|
)
|
||
Net sales
|
$
|
1,217.6
|
|
|
$
|
1,005.2
|
|
|
21.1
|
|
|
Fiscal Year
|
|
|
|||||||
|
2013
|
|
2012
|
|
Percentage
Change |
|||||
Methylphenidate ER
|
$
|
148.3
|
|
|
$
|
—
|
|
|
—
|
%
|
Oxycodone (API) and oxycodone-containing tablets
|
139.0
|
|
|
144.1
|
|
|
(3.5
|
)
|
||
Hydrocodone (API) and hydrocodone-containing tablets
|
140.0
|
|
|
130.5
|
|
|
7.3
|
|
||
Other controlled substances
|
443.3
|
|
|
439.5
|
|
|
0.9
|
|
||
Other
|
140.6
|
|
|
134.7
|
|
|
4.4
|
|
||
Specialty Generics and API
|
1,011.2
|
|
|
848.8
|
|
|
19.1
|
|
||
Exalgo
|
126.1
|
|
|
91.9
|
|
|
37.2
|
|
||
Offirmev
|
—
|
|
|
—
|
|
|
—
|
|
||
Acthar
|
—
|
|
|
—
|
|
|
—
|
|
||
Other
|
80.3
|
|
|
64.5
|
|
|
24.5
|
|
||
Brands
|
206.4
|
|
|
156.4
|
|
|
32.0
|
|
||
Specialty Pharmaceuticals
|
$
|
1,217.6
|
|
|
$
|
1,005.2
|
|
|
21.1
|
|
|
Fiscal Year
|
|
|
|||||||
|
2013
|
|
2012
|
|
Percentage
Change
|
|||||
U.S.
|
$
|
418.2
|
|
|
$
|
466.8
|
|
|
(10.4
|
)%
|
Europe, Middle East and Africa
|
300.2
|
|
|
302.3
|
|
|
(0.7
|
)
|
||
Other
|
217.3
|
|
|
227.7
|
|
|
(4.6
|
)
|
||
Net sales
|
$
|
935.7
|
|
|
$
|
996.8
|
|
|
(6.1
|
)
|
|
Fiscal Year
|
|
|
|||||||
|
2013
|
|
2012
|
|
Percentage
Change |
|||||
Optiray
|
$
|
318.5
|
|
|
$
|
352.2
|
|
|
(9.6
|
)%
|
Other
|
179.6
|
|
|
189.8
|
|
|
(5.4
|
)
|
||
Contrast Media and Delivery Systems
|
498.1
|
|
|
542.0
|
|
|
(8.1
|
)
|
||
Nuclear Imaging
|
437.6
|
|
|
454.8
|
|
|
(3.8
|
)
|
||
Global Medical Imaging
|
$
|
935.7
|
|
|
$
|
996.8
|
|
|
(6.1
|
)
|
|
Fiscal Year
|
||||||||||
|
2013
|
|
2012
|
||||||||
Specialty Pharmaceuticals
|
$
|
311.7
|
|
25.6
|
%
|
|
$
|
162.8
|
|
16.2
|
%
|
Global Medical Imaging
|
112.3
|
|
12.0
|
|
|
214.3
|
|
21.5
|
|
||
Segment operating income
|
424.0
|
|
19.7
|
|
|
377.1
|
|
18.8
|
|
||
Unallocated amounts:
|
|
|
|
|
|
||||||
Corporate and allocated expenses
|
(133.8
|
)
|
|
|
(69.9
|
)
|
|
||||
Intangible asset amortization
|
(35.4
|
)
|
|
|
(27.3
|
)
|
|
||||
Restructuring and related charges, net
(1)
|
(35.8
|
)
|
|
|
(19.2
|
)
|
|
||||
Separation costs
|
(74.2
|
)
|
|
|
(25.5
|
)
|
|
||||
Total operating income
|
$
|
144.8
|
|
|
|
$
|
235.2
|
|
|
(1)
|
Includes restructuring-related accelerated depreciation of
$2.6 million
and
$8.0 million
for fiscal
2013
and
2012
, respectively.
|
|
Fiscal Year
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Net cash provided by (used in):
|
|
|
|
|
|
||||||
Operating activities
|
$
|
373.4
|
|
|
$
|
135.9
|
|
|
$
|
255.8
|
|
Investing activities
|
(2,890.8
|
)
|
|
(234.7
|
)
|
|
(152.2
|
)
|
|||
Financing activities
|
2,953.9
|
|
|
373.0
|
|
|
(103.6
|
)
|
|||
Effect of currency exchange rate changes on cash and cash equivalents
|
(4.2
|
)
|
|
1.3
|
|
|
—
|
|
|||
Net increase in cash and cash equivalents
|
$
|
432.3
|
|
|
$
|
275.5
|
|
|
$
|
—
|
|
|
Payments Due By Period
|
||||||||||||||||||
|
Total
|
|
Less than 1 year
|
|
1 - 3 years
|
|
3 - 5 years
|
|
More than 5 years
|
||||||||||
Long-term debt obligations
|
$
|
3,970.9
|
|
|
$
|
19.8
|
|
|
$
|
195.2
|
|
|
$
|
342.8
|
|
|
$
|
3,413.1
|
|
Interest on long-term debt obligations
(1)
|
1,185.9
|
|
|
161.0
|
|
|
325.6
|
|
|
309.2
|
|
|
390.1
|
|
|||||
Capital lease obligations
(1)
|
1.8
|
|
|
1.4
|
|
|
0.4
|
|
|
—
|
|
|
—
|
|
|||||
Operating lease obligations
|
95.0
|
|
|
21.5
|
|
|
30.5
|
|
|
18.0
|
|
|
25.0
|
|
|||||
Purchase obligations
(2)
|
281.2
|
|
|
93.8
|
|
|
123.3
|
|
|
64.1
|
|
|
—
|
|
|||||
Total contractual obligations
|
$
|
5,534.8
|
|
|
$
|
297.5
|
|
|
$
|
675.0
|
|
|
$
|
734.1
|
|
|
$
|
3,828.2
|
|
(1)
|
Interest on debt and capital lease obligations are projected for future periods using interest rates in effect as of
September 26, 2014
. Certain of these projected interest payments may differ in the future based on changes in market interest rates.
|
(2)
|
Purchase obligations consist of commitments for purchases of goods and services made in the normal course of business to meet operational and capital requirements.
|
|
Rebates and Chargebacks
|
|
Product Returns
|
|
Other Sales Deductions
|
|
Total
|
||||||||
Balance at September 30, 2011
|
$
|
224.0
|
|
|
$
|
33.9
|
|
|
$
|
13.3
|
|
|
$
|
271.2
|
|
Provisions
|
1,085.9
|
|
|
30.0
|
|
|
41.9
|
|
|
1,157.8
|
|
||||
Payments or credits
|
(1,077.7
|
)
|
|
(29.2
|
)
|
|
(42.3
|
)
|
|
(1,149.2
|
)
|
||||
Balance at September 28, 2012
|
232.2
|
|
|
34.7
|
|
|
12.9
|
|
|
279.8
|
|
||||
Provisions
|
1,219.8
|
|
|
37.1
|
|
|
60.0
|
|
|
1,316.9
|
|
||||
Payments or credits
|
(1,194.9
|
)
|
|
(21.7
|
)
|
|
(57.2
|
)
|
|
(1,273.8
|
)
|
||||
Balance at September 27, 2013
|
257.1
|
|
|
50.1
|
|
|
15.7
|
|
|
322.9
|
|
||||
Provisions
|
1,668.6
|
|
|
84.5
|
|
|
93.7
|
|
|
1,846.8
|
|
||||
Payments or credits
|
(1,642.5
|
)
|
|
(31.3
|
)
|
|
(96.0
|
)
|
|
(1,769.8
|
)
|
||||
Acquisitions
|
30.1
|
|
|
0.5
|
|
|
—
|
|
|
30.6
|
|
||||
Balance at September 26, 2014
|
$
|
313.3
|
|
|
$
|
103.8
|
|
|
$
|
13.4
|
|
|
$
|
430.5
|
|
Item 7A.
|
Quantitative and Qualitative Disclosures About Market Risk.
|
Item 8.
|
Financial Statements and Supplementary Data.
|
Consolidated and Combined Financial Statements
|
|
|
|
Report of Independent Registered Public Accounting Firm.
|
|
Consolidated Statement of Income for the fiscal year ended September 26, 2014 and the Consolidated and Combined Statements of Income for the fiscal years ended September 27, 2013 and September 28, 2012.
|
|
Consolidated Statement of Comprehensive Income for the fiscal year ended September 26, 2014 and the Consolidated and Combined Statements of Comprehensive Income for the fiscal years ended September 27, 2013 and September 28, 2012.
|
|
Consolidated Balance Sheets as of September 26, 2014 and September 27, 2013.
|
|
Consolidated Statement of Cash Flows for the fiscal year ended September 26, 2014 and the Consolidated and Combined Statements of Cash Flows for the fiscal years ended September 27, 2013 and September 28, 2012.
|
|
Consolidated Statement of Changes in Shareholders' Equity for the period from September 27, 2013 to September 26, 2014 and the Consolidated and Combined Statement of Changes in Shareholders' Equity for the period from September 30, 2011 to September 27, 2013.
|
|
Notes to Consolidated and Combined Financial Statements.
|
|
Fiscal Year
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Net sales
|
$
|
2,540.4
|
|
|
$
|
2,204.5
|
|
|
$
|
2,056.2
|
|
Cost of sales
|
1,337.3
|
|
|
1,179.6
|
|
|
1,091.4
|
|
|||
Gross profit
|
1,203.1
|
|
|
1,024.9
|
|
|
964.8
|
|
|||
|
|
|
|
|
|
||||||
Selling, general and administrative expenses
|
842.1
|
|
|
609.9
|
|
|
551.7
|
|
|||
Research and development expenses
|
166.9
|
|
|
165.7
|
|
|
144.1
|
|
|||
Separation costs
|
9.6
|
|
|
74.2
|
|
|
25.5
|
|
|||
Restructuring charges, net
|
128.6
|
|
|
33.2
|
|
|
11.2
|
|
|||
Non-restructuring impairment charges
|
355.6
|
|
|
—
|
|
|
—
|
|
|||
Gain on divestiture and license
|
(15.6
|
)
|
|
(2.9
|
)
|
|
(2.9
|
)
|
|||
Operating (loss) income
|
(284.1
|
)
|
|
144.8
|
|
|
235.2
|
|
|||
|
|
|
|
|
|
||||||
Interest expense
|
(82.6
|
)
|
|
(19.5
|
)
|
|
(0.5
|
)
|
|||
Interest income
|
1.5
|
|
|
0.3
|
|
|
0.4
|
|
|||
Other income, net
|
1.8
|
|
|
0.8
|
|
|
1.0
|
|
|||
Income (loss) from continuing operations before income taxes
|
(363.4
|
)
|
|
126.4
|
|
|
236.1
|
|
|||
|
|
|
|
|
|
||||||
Provision for (benefit from) income taxes
|
(44.8
|
)
|
|
68.6
|
|
|
94.8
|
|
|||
Income (loss) from continuing operations
|
(318.6
|
)
|
|
57.8
|
|
|
141.3
|
|
|||
|
|
|
|
|
|
||||||
Income (loss) from discontinued operations, net of income taxes
|
(0.7
|
)
|
|
1.0
|
|
|
(6.7
|
)
|
|||
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(319.3
|
)
|
|
$
|
58.8
|
|
|
$
|
134.6
|
|
|
|
|
|
|
|
||||||
Basic earnings (loss) per share (Note 8):
|
|
|
|
|
|
||||||
Income (loss) from continuing operations
|
$
|
(4.91
|
)
|
|
$
|
1.00
|
|
|
$
|
2.45
|
|
Income (loss) from discontinued operations, net of income taxes
|
(0.01
|
)
|
|
0.02
|
|
|
(0.12
|
)
|
|||
Net income (loss)
|
(4.92
|
)
|
|
1.02
|
|
|
2.33
|
|
|||
|
|
|
|
|
|
||||||
Basic weighted-average shares outstanding
|
64.9
|
|
|
57.7
|
|
|
57.7
|
|
|||
|
|
|
|
|
|
||||||
Diluted earnings (loss) per share (Note 8):
|
|
|
|
|
|
||||||
Income (loss) from continuing operations
|
$
|
(4.91
|
)
|
|
$
|
1.00
|
|
|
$
|
2.45
|
|
Income (loss) from discontinued operations, net of income taxes
|
(0.01
|
)
|
|
0.02
|
|
|
(0.12
|
)
|
|||
Net income (loss)
|
(4.92
|
)
|
|
1.02
|
|
|
2.33
|
|
|||
|
|
|
|
|
|
||||||
Diluted weighted-average shares outstanding
|
64.9
|
|
|
57.8
|
|
|
57.7
|
|
|
Fiscal Year
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Net income (loss)
|
$
|
(319.3
|
)
|
|
$
|
58.8
|
|
|
$
|
134.6
|
|
Other comprehensive income (loss), net of tax
|
|
|
|
|
|
||||||
Currency translation adjustments
|
(27.6
|
)
|
|
1.5
|
|
|
(2.9
|
)
|
|||
Unrecognized gain (loss) on derivatives, net of $(0.2), $- and $- tax
|
0.5
|
|
|
(7.3
|
)
|
|
—
|
|
|||
Unrecognized gain (loss) on benefit plans, net of $7.3, $(23.9) and $4.6 tax
|
(15.7
|
)
|
|
34.2
|
|
|
(10.7
|
)
|
|||
Total other comprehensive income (loss), net of tax
|
(42.8
|
)
|
|
28.4
|
|
|
(13.6
|
)
|
|||
Comprehensive income (loss)
|
$
|
(362.1
|
)
|
|
$
|
87.2
|
|
|
$
|
121.0
|
|
|
September 26,
2014 |
|
September 27,
2013 |
|||||
Assets
|
|
|
|
|||||
Current Assets:
|
|
|
|
|||||
Cash and cash equivalents
|
$
|
707.8
|
|
|
$
|
275.5
|
|
|
Accounts receivable, less allowance for doubtful accounts of $6.6 and $4.6
|
545.6
|
|
|
400.8
|
|
|||
Inventories
|
396.6
|
|
|
403.1
|
|
|||
Deferred income taxes
|
165.2
|
|
|
171.1
|
|
|||
Prepaid expenses and other current assets
|
255.8
|
|
|
134.4
|
|
|||
Total current assets
|
2,071.0
|
|
|
1,384.9
|
|
|||
Property, plant and equipment, net
|
949.2
|
|
|
997.4
|
|
|||
Goodwill
|
2,401.9
|
|
|
532.0
|
|
|||
Intangible assets, net
|
7,112.2
|
|
|
422.1
|
|
|||
Other assets
|
330.5
|
|
|
220.2
|
|
|||
Total Assets
|
$
|
12,864.8
|
|
|
$
|
3,556.6
|
|
|
Liabilities and Shareholders' Equity
|
|
|
|
|||||
Current Liabilities:
|
|
|
|
|||||
Current maturities of long-term debt
|
$
|
21.2
|
|
|
$
|
1.5
|
|
|
Accounts payable
|
128.7
|
|
|
120.9
|
|
|||
Accrued payroll and payroll-related costs
|
125.1
|
|
|
66.5
|
|
|||
Accrued royalties
|
68.0
|
|
|
13.2
|
|
|||
Accrued branded rebates
|
15.1
|
|
|
34.6
|
|
|||
Accrued and other current liabilities
|
546.7
|
|
|
363.5
|
|
|||
Total current liabilities
|
904.8
|
|
|
600.2
|
|
|||
Long-term debt
|
3,951.5
|
|
|
918.3
|
|
|||
Pension and postretirement benefits
|
119.1
|
|
|
108.0
|
|
|||
Environmental liabilities
|
59.9
|
|
|
39.5
|
|
|||
Deferred income taxes
|
2,398.6
|
|
|
310.1
|
|
|||
Other income tax liabilities
|
122.6
|
|
|
153.1
|
|
|||
Other liabilities
|
350.3
|
|
|
171.8
|
|
|||
Total Liabilities
|
7,906.8
|
|
|
2,301.0
|
|
|||
Commitments and contingencies (Note 18)
|
|
—
|
|
|
||||
Shareholders' Equity:
|
|
|
|
|||||
Preferred shares, $0.20 par value, 500,000,000 authorized; none issued or outstanding
|
—
|
|
|
—
|
|
|||
Ordinary A shares, €1.00 par value, 40,000 authorized; none issued or outstanding
|
—
|
|
|
—
|
|
|||
Ordinary shares, $0.20 par value, 500,000,000 authorized; 116,160,353 and 57,713,873 issued;
115,929,588 and 57,713,390 outstanding
|
23.2
|
|
|
11.5
|
|
|||
Ordinary shares held in treasury at cost, 230,765 and 483
|
(17.5
|
)
|
|
—
|
|
|||
Additional paid-in capital
|
5,172.4
|
|
|
1,102.1
|
|
|||
Retained earnings
|
(285.8
|
)
|
|
33.5
|
|
|||
Accumulated other comprehensive income
|
65.7
|
|
|
108.5
|
|
|||
Total Shareholders' Equity
|
4,958.0
|
|
|
1,255.6
|
|
|||
Total Liabilities and Shareholders' Equity
|
$
|
12,864.8
|
|
|
$
|
3,556.6
|
|
|
Fiscal Year
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Cash Flows From Operating Activities:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(319.3
|
)
|
|
$
|
58.8
|
|
|
$
|
134.6
|
|
(Income) loss from discontinued operations, net of income taxes
|
0.7
|
|
|
(1.0
|
)
|
|
6.7
|
|
|||
Income (loss) from continuing operations
|
(318.6
|
)
|
|
57.8
|
|
|
141.3
|
|
|||
Adjustments to reconcile net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
275.9
|
|
|
139.6
|
|
|
130.9
|
|
|||
Share-based compensation
|
67.7
|
|
|
16.2
|
|
|
10.7
|
|
|||
Deferred income taxes
|
(107.5
|
)
|
|
(9.0
|
)
|
|
9.0
|
|
|||
Non-cash impairment charges
|
381.2
|
|
|
—
|
|
|
—
|
|
|||
Inventory provisions
|
32.1
|
|
|
15.5
|
|
|
2.7
|
|
|||
Other non-cash items
|
(24.3
|
)
|
|
(5.2
|
)
|
|
(13.4
|
)
|
|||
Changes in assets and liabilities, net of the effects of acquisitions:
|
|
|
|
|
|
||||||
Accounts receivable, net
|
(51.3
|
)
|
|
(181.2
|
)
|
|
(6.8
|
)
|
|||
Inventories
|
56.0
|
|
|
27.7
|
|
|
(62.8
|
)
|
|||
Accounts payable
|
(32.9
|
)
|
|
7.2
|
|
|
(8.3
|
)
|
|||
Income taxes
|
(54.8
|
)
|
|
60.7
|
|
|
79.4
|
|
|||
Accrued and other liabilities
|
110.5
|
|
|
22.6
|
|
|
(38.7
|
)
|
|||
Other
|
39.4
|
|
|
(16.0
|
)
|
|
11.8
|
|
|||
Net cash provided by operating activities
|
373.4
|
|
|
135.9
|
|
|
255.8
|
|
|||
Cash Flows From Investing Activities:
|
|
|
|
|
|
||||||
Capital expenditures
|
(127.8
|
)
|
|
(147.9
|
)
|
|
(144.2
|
)
|
|||
Acquisitions and intangibles, net of cash acquired
|
(2,793.8
|
)
|
|
(88.1
|
)
|
|
(13.2
|
)
|
|||
Restricted cash
|
4.1
|
|
|
—
|
|
|
—
|
|
|||
Other
|
26.7
|
|
|
1.3
|
|
|
5.2
|
|
|||
Net cash (used in) investing activities
|
(2,890.8
|
)
|
|
(234.7
|
)
|
|
(152.2
|
)
|
|||
Cash Flows From Financing Activities:
|
|
|
|
|
|
||||||
Issuance of external debt
|
3,043.2
|
|
|
898.1
|
|
|
—
|
|
|||
Repayment of external debt and capital leases
|
(34.8
|
)
|
|
(1.3
|
)
|
|
(1.3
|
)
|
|||
Excess tax benefit from share-based compensation
|
8.9
|
|
|
3.4
|
|
|
1.7
|
|
|||
Debt financing costs
|
(71.7
|
)
|
|
(12.0
|
)
|
|
—
|
|
|||
Net transfers to parent
|
—
|
|
|
(515.9
|
)
|
|
(104.0
|
)
|
|||
Proceeds from exercise of share options
|
25.8
|
|
|
0.6
|
|
|
—
|
|
|||
Repurchase of shares
|
(17.5
|
)
|
|
—
|
|
|
—
|
|
|||
Other
|
—
|
|
|
0.1
|
|
|
—
|
|
|||
Net cash provided by (used in) financing activities
|
2,953.9
|
|
|
373.0
|
|
|
(103.6
|
)
|
|||
Effect of currency rate changes on cash
|
(4.2
|
)
|
|
1.3
|
|
|
—
|
|
|||
Net increase in cash and cash equivalents
|
432.3
|
|
|
275.5
|
|
|
—
|
|
|||
Cash and cash equivalents at beginning of period
|
275.5
|
|
|
—
|
|
|
—
|
|
|||
Cash and cash equivalents at end of period
|
$
|
707.8
|
|
|
$
|
275.5
|
|
|
$
|
—
|
|
|
|
|
|
|
|
||||||
Supplemental Disclosures of Cash Flow Information:
|
|
|
|
|
|
||||||
Cash paid for interest, net
|
$
|
57.2
|
|
|
$
|
0.8
|
|
|
$
|
0.6
|
|
Cash paid for income taxes, net
|
128.0
|
|
|
15.0
|
|
|
4.9
|
|
|
Ordinary Shares
|
|
Treasury Shares
|
|
Additional Paid-In Capital
|
|
Retained Earnings
|
|
Contributed
Surplus
|
|
Parent
Company
Investment
|
|
Accumulated
Other
Comprehensive
Income
|
|
Total
Shareholders'
Equity
|
||||||||||||||||||||||
|
Number
|
|
Par
Value
|
|
Number
|
|
Amount
|
|
|||||||||||||||||||||||||||||
Balance at September 30, 2011
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,690.2
|
|
|
$
|
98.5
|
|
|
$
|
1,788.7
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
134.6
|
|
|
—
|
|
|
134.6
|
|
||||||||
Currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2.9
|
)
|
|
(2.9
|
)
|
||||||||
Minimum pension liability, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10.7
|
)
|
|
(10.7
|
)
|
||||||||
Net transfers to parent
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17.8
|
)
|
|
—
|
|
|
(17.8
|
)
|
||||||||
Balance at September 28, 2012
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1,807.0
|
|
|
$
|
84.9
|
|
|
$
|
1,891.9
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
33.5
|
|
|
—
|
|
|
25.3
|
|
|
—
|
|
|
58.8
|
|
||||||||
Currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1.5
|
|
|
1.5
|
|
||||||||
Change in derivatives, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7.3
|
)
|
|
(7.3
|
)
|
||||||||
Minimum pension liability, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
34.2
|
|
|
34.2
|
|
||||||||
Net transfers to parent
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(515.9
|
)
|
|
—
|
|
|
(515.9
|
)
|
||||||||
Separation related adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(209.9
|
)
|
|
(4.8
|
)
|
|
(214.7
|
)
|
||||||||
Transfer of parent company investment to contributed surplus
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,106.5
|
|
|
(1,106.5
|
)
|
|
—
|
|
|
—
|
|
||||||||
Transfer of contributed surplus to distributable reserves
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,095.0
|
|
|
—
|
|
|
(1,095.0
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Share options exercised
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.6
|
|
||||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6.5
|
|
||||||||
Issuance of ordinary shares
|
57.7
|
|
|
11.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11.5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Balance at September 27, 2013
|
57.7
|
|
|
$
|
11.5
|
|
|
—
|
|
|
$
|
—
|
|
|
$
|
1,102.1
|
|
|
$
|
33.5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
108.5
|
|
|
$
|
1,255.6
|
|
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(319.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(319.3
|
)
|
||||||||
Currency translation adjustments
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(27.6
|
)
|
|
(27.6
|
)
|
||||||||
Change in derivatives, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.5
|
|
|
0.5
|
|
||||||||
Minimum pension liability, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15.7
|
)
|
|
(15.7
|
)
|
||||||||
Ordinary shares issued in connection with the Questcor acquisition
|
57.3
|
|
|
11.4
|
|
|
—
|
|
|
—
|
|
|
3,968.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,979.6
|
|
||||||||
Share options exercised
|
0.8
|
|
|
0.2
|
|
|
—
|
|
|
—
|
|
|
25.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
25.8
|
|
||||||||
Vesting of restricted shares
|
0.4
|
|
|
0.1
|
|
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Excess tax benefit from share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8.9
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8.9
|
|
||||||||
Share-based compensation
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
67.7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
67.7
|
|
||||||||
Repurchase of ordinary shares
|
—
|
|
|
—
|
|
|
0.2
|
|
|
(17.5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17.5
|
)
|
||||||||
Balance at September 26, 2014
|
116.2
|
|
|
$
|
23.2
|
|
|
0.2
|
|
|
$
|
(17.5
|
)
|
|
$
|
5,172.4
|
|
|
$
|
(285.8
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
65.7
|
|
|
$
|
4,958.0
|
|
1.
|
Background and Basis of Presentation
|
•
|
Specialty Pharmaceuticals
produces and markets branded pharmaceuticals and biopharmaceuticals, specialty generic pharmaceuticals and active pharmaceutical ingredients ("API") consisting of biologics, medicinal opioids, synthetic controlled substances, acetaminophen and other active ingredients; and
|
•
|
Global Medical Imaging
develops, manufactures and markets contrast media and delivery systems ("CMDS") and radiopharmaceuticals (nuclear medicine).
|
2.
|
Summary of Significant Accounting Policies
|
Buildings
|
10
|
to
|
45 years
|
Leasehold improvements
|
1
|
to
|
20 years
|
Capitalized software
|
1
|
to
|
10 years
|
Machinery and equipment
|
1
|
to
|
20 years
|
Completed technology
|
5
|
to
|
25 years
|
License agreements
|
8
|
to
|
30 years
|
Trademarks
|
3
|
to
|
30 years
|
Customer relationships
|
|
|
12 years
|
3.
|
Recently Issued Accounting Standards
|
4.
|
Discontinued Operations and Divestitures
|
5.
|
Acquisitions and License Agreements
|
|
Questcor Pharmaceuticals
|
|
Cadence Pharmaceuticals
|
|
CNS Therapeutics
|
||||||
Cash
|
$
|
445.1
|
|
|
$
|
43.2
|
|
|
$
|
3.6
|
|
Inventory
|
67.9
|
|
|
21.0
|
|
|
—
|
|
|||
Intangible assets
|
5,601.1
|
|
|
1,300.0
|
|
|
91.9
|
|
|||
Goodwill (non-tax deductible)
|
1,771.5
|
|
|
318.1
|
|
|
24.5
|
|
|||
Other assets, current and non-current
|
273.9
|
|
|
18.0
|
|
|
9.7
|
|
|||
Total assets acquired
|
8,159.5
|
|
|
1,700.3
|
|
|
129.7
|
|
|||
Current liabilities
|
159.8
|
|
|
60.1
|
|
|
4.0
|
|
|||
Unpaid purchase consideration (current)
|
128.8
|
|
|
—
|
|
|
—
|
|
|||
Other liabilities (non-current)
|
183.7
|
|
|
18.7
|
|
|
—
|
|
|||
Deferred tax liabilities, net (non-current)
|
1,900.7
|
|
|
292.3
|
|
|
27.1
|
|
|||
Contingent consideration (non-current)
|
—
|
|
|
—
|
|
|
6.9
|
|
|||
Total liabilities assumed
|
2,373.0
|
|
|
371.1
|
|
|
38.0
|
|
|||
Net assets acquired
|
$
|
5,786.5
|
|
|
$
|
1,329.2
|
|
|
$
|
91.7
|
|
|
Questcor Pharmaceuticals
|
|
Cadence Pharmaceuticals
|
|
CNS Therapeutics
|
||||||
Total consideration, net of cash
|
$
|
5,470.2
|
|
|
$
|
1,286.0
|
|
|
$
|
95.0
|
|
Plus: cash assumed in acquisition
|
445.1
|
|
|
43.2
|
|
|
3.6
|
|
|||
Total consideration
|
5,915.3
|
|
|
1,329.2
|
|
|
98.6
|
|
|||
Less: unpaid purchase consideration
|
(128.8
|
)
|
|
—
|
|
|
—
|
|
|||
Less: contingent consideration
|
—
|
|
|
—
|
|
|
(6.9
|
)
|
|||
Net assets acquired
|
$
|
5,786.5
|
|
|
$
|
1,329.2
|
|
|
$
|
91.7
|
|
Questcor Pharmaceuticals
|
Amount
|
|
Weighted-Average Amortization Period
|
||
Completed technology
|
$
|
5,343.3
|
|
|
18 years
|
Trademark
|
5.2
|
|
|
13 years
|
|
Customer relationships
|
34.3
|
|
|
12 years
|
|
In-process research and development
|
218.3
|
|
|
Non-Amortizable
|
|
|
$
|
5,601.1
|
|
|
|
Cadence Pharmaceuticals
|
Amount
|
|
Amortization Period
|
||
Completed technology
|
$
|
1,300.0
|
|
|
8 years
|
CNS Therapeutics
|
Amount
|
|
Weighted-Average Amortization Period
|
||
Completed technology
|
$
|
73.1
|
|
|
13 years
|
Trademark
|
0.2
|
|
|
3 years
|
|
In-process research and development
|
18.6
|
|
|
Non-Amortizable
|
|
|
$
|
91.9
|
|
|
|
Net Sales
|
|
||
Questcor
|
$
|
129.2
|
|
Cadence
|
124.4
|
|
|
|
$
|
253.6
|
|
Operating income (loss)
|
|
|
|
Questcor
|
$
|
17.4
|
|
Cadence
|
(66.9
|
)
|
|
|
$
|
(49.5
|
)
|
Questcor
|
47.5
|
|
|
Cadence
|
17.6
|
|
|
|
$
|
65.1
|
|
•
|
non-recurring costs related to the step-up in fair value of acquired inventory and transaction costs related to the acquisitions;
|
•
|
increased amortization expense related to the intangible assets acquired in the acquisitions;
|
•
|
elimination of direct acquisition transaction costs from the period of acquisition;
|
•
|
increased interest expense to reflect the variable-rate term loan and revolving credit facility entered into in connection with the acquisition of Cadence (utilizing the interest rate in effect at
September 26, 2014
of
3.50%
) and the fixed-rate senior unsecured notes and variable-rate term loan entered into in connection with the acquisition of Questcor (utilizing the interest rate in effect at
September 26, 2014
of
3.50%
), including interest and amortization of deferred financing costs and original issue discount; and
|
•
|
the related income tax effects.
|
|
2014
|
|
2013
|
||||
Net sales
|
$
|
3,487.1
|
|
|
$
|
3,015.5
|
|
Net income (loss)
|
(326.8
|
)
|
|
(61.5
|
)
|
||
|
|
|
|
||||
Basic earnings (loss) per share
|
$
|
(2.84
|
)
|
|
$
|
(0.54
|
)
|
Diluted earnings (loss) per share
|
(2.84
|
)
|
|
(0.54
|
)
|
6.
|
Restructuring and Related Charges
|
|
Fiscal Year
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Specialty Pharmaceuticals
|
$
|
66.8
|
|
|
$
|
16.4
|
|
|
$
|
11.3
|
|
Global Medical Imaging
|
60.9
|
|
|
16.4
|
|
|
7.9
|
|
|||
Corporate
|
1.4
|
|
|
3.0
|
|
|
—
|
|
|||
Restructuring and related charges, net
|
129.1
|
|
|
35.8
|
|
|
19.2
|
|
|||
Less: accelerated depreciation
|
(0.5
|
)
|
|
(2.6
|
)
|
|
(8.0
|
)
|
|||
Restructuring charges, net
|
$
|
128.6
|
|
|
$
|
33.2
|
|
|
$
|
11.2
|
|
|
Fiscal Year
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
2013 Mallinckrodt Program
|
$
|
74.5
|
|
|
$
|
14.9
|
|
|
$
|
—
|
|
Acquisition programs
|
56.4
|
|
|
—
|
|
|
—
|
|
|||
Other programs
|
(1.8
|
)
|
|
20.9
|
|
|
19.2
|
|
|||
Total programs
|
129.1
|
|
|
35.8
|
|
|
19.2
|
|
|||
Less: non-cash charges, including impairments and accelerated share based compensation expense
|
(61.3
|
)
|
|
(2.6
|
)
|
|
(6.2
|
)
|
|||
Total charges expected to be settled in cash
|
$
|
67.8
|
|
|
$
|
33.2
|
|
|
$
|
13.0
|
|
|
2013 Mallinckrodt Program
|
|
Acquisition Programs
|
|
Other Programs
|
|
Total
|
||||||||
Balance at September 30, 2011
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
7.6
|
|
|
$
|
7.6
|
|
Charges
|
—
|
|
|
—
|
|
|
12.8
|
|
|
12.8
|
|
||||
Changes in estimate
|
—
|
|
|
—
|
|
|
0.2
|
|
|
0.2
|
|
||||
Cash payments
|
—
|
|
|
—
|
|
|
(11.5
|
)
|
|
(11.5
|
)
|
||||
Reclassifications
(1)
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|
(0.2
|
)
|
||||
Balance at September 28, 2012
|
—
|
|
|
—
|
|
|
8.9
|
|
|
8.9
|
|
||||
Charges
|
14.9
|
|
|
—
|
|
|
20.9
|
|
|
35.8
|
|
||||
Changes in estimate
|
—
|
|
|
—
|
|
|
(2.6
|
)
|
|
(2.6
|
)
|
||||
Cash payments
|
—
|
|
|
—
|
|
|
(15.1
|
)
|
|
(15.1
|
)
|
||||
Reclassifications
(1)
|
—
|
|
|
—
|
|
|
(1.5
|
)
|
|
(1.5
|
)
|
||||
Balance at September 27, 2013
|
14.9
|
|
|
—
|
|
|
10.6
|
|
|
25.5
|
|
||||
Charges
|
58.2
|
|
|
22.9
|
|
|
2.5
|
|
|
83.6
|
|
||||
Changes in estimate
|
(9.4
|
)
|
|
(1.6
|
)
|
|
(4.8
|
)
|
|
(15.8
|
)
|
||||
Cash payments
|
(34.8
|
)
|
|
(13.4
|
)
|
|
(6.8
|
)
|
|
(55.0
|
)
|
||||
Reclassifications
(1)
|
(1.3
|
)
|
|
—
|
|
|
(1.0
|
)
|
|
(2.3
|
)
|
||||
Currency translation
|
(1.0
|
)
|
|
—
|
|
|
(0.1
|
)
|
|
(1.1
|
)
|
||||
Balance at September 26, 2014
|
$
|
26.6
|
|
|
$
|
7.9
|
|
|
$
|
0.4
|
|
|
$
|
34.9
|
|
(1)
|
Represents the reclassification of pension and other postretirement benefits from restructuring reserves to pension and postretirement obligations.
|
Specialty Pharmaceuticals
|
$
|
12.6
|
|
Global Medical Imaging
|
71.5
|
|
|
Corporate
|
5.3
|
|
|
|
$
|
89.4
|
|
7.
|
Income Taxes
|
|
2014
|
|
2013
|
|
2012
|
||||||
U.S.
|
$
|
(334.7
|
)
|
|
$
|
70.0
|
|
|
$
|
174.6
|
|
Non-U.S.
|
(28.7
|
)
|
|
56.4
|
|
|
61.5
|
|
|||
Total
|
$
|
(363.4
|
)
|
|
$
|
126.4
|
|
|
$
|
236.1
|
|
|
2014
|
|
2013
|
|
2012
|
||||||
Current:
|
|
|
|
|
|
||||||
U.S.:
|
|
|
|
|
|
||||||
Federal
|
$
|
49.8
|
|
|
$
|
45.7
|
|
|
$
|
61.1
|
|
State
|
1.5
|
|
|
9.2
|
|
|
7.2
|
|
|||
Non-U.S.
|
11.4
|
|
|
22.7
|
|
|
17.5
|
|
|||
Current income tax provision
|
62.7
|
|
|
77.6
|
|
|
85.8
|
|
|||
Deferred:
|
|
|
|
|
|
||||||
U.S.:
|
|
|
|
|
|
||||||
Federal
|
(68.3
|
)
|
|
(11.7
|
)
|
|
5.3
|
|
|||
State
|
(17.0
|
)
|
|
(1.2
|
)
|
|
2.4
|
|
|||
Non-U.S.
|
(22.2
|
)
|
|
3.9
|
|
|
1.3
|
|
|||
Deferred income tax (benefit) provision
|
(107.5
|
)
|
|
(9.0
|
)
|
|
9.0
|
|
|||
|
$
|
(44.8
|
)
|
|
$
|
68.6
|
|
|
$
|
94.8
|
|
|
2014
|
|
2013
|
|
2012
|
||||||
Notional U.S. federal income taxes at the statutory rate
|
$
|
(127.2
|
)
|
|
$
|
44.3
|
|
|
$
|
82.6
|
|
Adjustments to reconcile to income tax provision:
|
|
|
|
|
|
||||||
U.S. state income tax provision, net
(1)
|
(7.9
|
)
|
|
4.8
|
|
|
7.1
|
|
|||
Rate difference between non-U.S. and U.S. jurisdictions
(2) (3)
|
(5.8
|
)
|
|
(2.2
|
)
|
|
(3.5
|
)
|
|||
Domestic manufacturing deduction
|
(4.8
|
)
|
|
(2.5
|
)
|
|
(3.0
|
)
|
|||
Valuation allowances, nonrecurring
|
(2.4
|
)
|
|
3.4
|
|
|
—
|
|
|||
Adjustments to accrued income tax liabilities and uncertain tax positions
(3)
|
(0.5
|
)
|
|
8.6
|
|
|
1.2
|
|
|||
Interest and penalties on accrued income tax liabilities and uncertain tax positions
(3)
|
(8.0
|
)
|
|
4.7
|
|
|
1.1
|
|
|||
Investment in partnership
|
20.0
|
|
|
—
|
|
|
—
|
|
|||
Credits, principally research
(4)
|
(0.7
|
)
|
|
(6.2
|
)
|
|
(0.8
|
)
|
|||
Impairments, nondeductible
|
76.9
|
|
|
—
|
|
|
—
|
|
|||
Permanently nondeductible and nontaxable items
(5)
|
15.0
|
|
|
12.0
|
|
|
8.1
|
|
|||
Other
|
0.6
|
|
|
1.7
|
|
|
2.0
|
|
|||
Provision for income taxes
|
$
|
(44.8
|
)
|
|
$
|
68.6
|
|
|
$
|
94.8
|
|
(1)
|
Fiscal 2014 includes approximately
$4.4 million
of tax benefit associated with the favorable impact of the Questcor acquisition on the Company's measurement of its net deferred tax liabilities.
|
(2)
|
Excludes non-deductible charges and other items which are broken out separately in the statutory rate reconciliation presented. Also includes the impact of certain valuation allowances.
|
(3)
|
Fiscal years 2013 and 2012 include impact of items relating to entities retained by Covidien in connection with the Separation.
|
(4)
|
Due to the December 31, 2011 tax law expiration, fiscal 2012 includes U.S. Research Credits for only the three months ended December 31, 2011. During fiscal 2013, the legislation was extended, with a retroactive effective date of January 1, 2012. As such, fiscal 2013 includes approximately
$2.3 million
of credit related to the period January 1, 2012 through September 28, 2012. Due to the December 31, 2013 tax law expiration, fiscal 2014 includes
$0.7 million
for the period September 28, 2013 through December 31, 2013.
|
(5)
|
Includes the impact of nondeductible transaction and separation costs.
|
|
2014
|
|
2013
|
|
2012
|
||||||
Balance at beginning of fiscal year
|
$
|
100.1
|
|
|
$
|
165.5
|
|
|
$
|
168.4
|
|
Unrecognized tax benefits retained by Covidien
|
—
|
|
|
(153.7
|
)
|
|
—
|
|
|||
Unrecognized tax benefits transferred from Covidien
|
—
|
|
|
84.2
|
|
|
—
|
|
|||
Additions related to current year tax positions
|
3.2
|
|
|
3.5
|
|
|
1.3
|
|
|||
Additions related to prior period tax positions
|
30.6
|
|
|
6.6
|
|
|
1.6
|
|
|||
Reductions related to prior period tax positions
|
(33.0
|
)
|
|
(4.3
|
)
|
|
(1.9
|
)
|
|||
Settlements
|
(6.9
|
)
|
|
(1.6
|
)
|
|
(1.7
|
)
|
|||
Lapse of statute of limitations
|
(12.0
|
)
|
|
(0.1
|
)
|
|
(2.2
|
)
|
|||
Balance at end of fiscal year
|
82.0
|
|
|
100.1
|
|
|
165.5
|
|
|||
Cash advance paid in connection with proposed settlements
|
—
|
|
|
—
|
|
|
(23.5
|
)
|
|||
Balance at end of fiscal year, net of cash advance
|
$
|
82.0
|
|
|
$
|
100.1
|
|
|
$
|
142.0
|
|
|
September 26, 2014
|
|
September 27, 2013
|
||||
Accrued and other current liabilities
|
$
|
6.5
|
|
|
$
|
23.4
|
|
Other income tax liabilities
|
70.7
|
|
|
76.7
|
|
||
Deferred income taxes (non-current liability)
|
4.8
|
|
|
—
|
|
||
|
$
|
82.0
|
|
|
$
|
100.1
|
|
|
September 26, 2014
|
|
September 27, 2013
|
||||
Accrued and other current liabilities
|
$
|
17.7
|
|
|
$
|
28.2
|
|
Other income tax liabilities
|
122.6
|
|
|
153.1
|
|
||
|
$
|
140.3
|
|
|
$
|
181.3
|
|
|
September 26, 2014
|
|
September 27, 2013
|
||||
Other assets
|
14.8
|
|
|
—
|
|
||
Prepaid expenses and other current assets
|
76.6
|
|
|
5.4
|
|
||
|
$
|
91.4
|
|
|
$
|
5.4
|
|
Jurisdiction
|
Earliest Open Year
|
U.S. - federal and state
|
1996
|
Ireland
|
2009
|
Netherlands
|
2013
|
Switzerland
|
2012
|
|
September 26, 2014
|
|
September 27, 2013
|
||||
Deferred tax assets:
|
|
|
|
||||
Accrued liabilities and reserves
|
$
|
79.1
|
|
|
$
|
35.5
|
|
Inventories
|
22.1
|
|
|
30.5
|
|
||
Tax loss and credit carryforwards
|
102.0
|
|
|
53.6
|
|
||
Environmental liabilities
|
29.5
|
|
|
27.3
|
|
||
Rebate reserves
|
41.1
|
|
|
43.4
|
|
||
Expired product
|
38.9
|
|
|
18.4
|
|
||
Postretirement benefits
|
36.3
|
|
|
31.2
|
|
||
Federal and state benefit of uncertain tax positions and interest
|
29.6
|
|
|
47.1
|
|
||
Deferred intercompany interest
|
—
|
|
|
19.2
|
|
||
Share-based compensation
|
28.0
|
|
|
12.3
|
|
||
Other
|
31.5
|
|
|
25.6
|
|
||
|
438.1
|
|
|
344.1
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Property, plant and equipment
|
(110.0
|
)
|
|
(160.5
|
)
|
||
Intangible assets
|
(2,176.5
|
)
|
|
(113.1
|
)
|
||
Installment sale
|
(93.5
|
)
|
|
—
|
|
||
Investment in partnership
|
(191.3
|
)
|
|
(173.6
|
)
|
||
|
(2,571.3
|
)
|
|
(447.2
|
)
|
||
Net deferred tax (liability) asset before valuation allowances
|
(2,133.2
|
)
|
|
(103.1
|
)
|
||
Valuation allowances
|
(77.5
|
)
|
|
(30.0
|
)
|
||
Net deferred tax (liability) asset
|
$
|
(2,210.7
|
)
|
|
$
|
(133.1
|
)
|
|
September 26, 2014
|
|
September 27, 2013
|
||||
Deferred income taxes (current asset)
|
$
|
165.2
|
|
|
$
|
171.1
|
|
Other non-current assets
|
24.1
|
|
|
7.5
|
|
||
Accrued and other current liabilities
|
(1.4
|
)
|
|
(1.6
|
)
|
||
Deferred income taxes (non-current liability)
|
(2,398.6
|
)
|
|
(310.1
|
)
|
||
Net deferred tax (liability) asset
|
$
|
(2,210.7
|
)
|
|
$
|
(133.1
|
)
|
8.
|
Earnings (Loss) per Share
|
9.
|
Inventories
|
|
September 26,
2014 |
|
September 27,
2013 |
||||
Raw materials and supplies
|
$
|
73.6
|
|
|
$
|
68.8
|
|
Work in process
|
212.1
|
|
|
191.5
|
|
||
Finished goods
|
110.9
|
|
|
142.8
|
|
||
Inventories
|
$
|
396.6
|
|
|
$
|
403.1
|
|
10.
|
Property, Plant and Equipment
|
|
September 26, 2014
|
|
September 27, 2013
|
||||
Land
|
$
|
59.9
|
|
|
$
|
60.4
|
|
Buildings
|
330.6
|
|
|
316.6
|
|
||
Capitalized software
|
97.6
|
|
|
76.4
|
|
||
Machinery and equipment
|
1,202.1
|
|
|
1,226.6
|
|
||
Construction in process
|
198.2
|
|
|
193.7
|
|
||
|
1,888.4
|
|
|
1,873.7
|
|
||
Less: accumulated depreciation
|
(939.2
|
)
|
|
(876.3
|
)
|
||
Property, plant and equipment, net
|
$
|
949.2
|
|
|
$
|
997.4
|
|
11.
|
Goodwill and Intangible Assets
|
|
Specialty Pharmaceuticals
|
|
Global Medical Imaging
|
|
Total
|
||||||
Goodwill at September 27, 2013
|
$
|
312.3
|
|
|
$
|
219.7
|
|
|
$
|
532.0
|
|
Acquisitions
|
2,089.6
|
|
|
—
|
|
|
2,089.6
|
|
|||
Impairment
|
—
|
|
|
(219.7
|
)
|
|
(219.7
|
)
|
|||
Goodwill at September 26, 2014
|
$
|
2,401.9
|
|
|
$
|
—
|
|
|
$
|
2,401.9
|
|
|
September 26, 2014
|
|
September 27, 2013
|
||||||||||||
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
||||||||
Amortizable:
|
|
|
|
|
|
|
|
||||||||
Completed technology
|
$
|
7,040.1
|
|
|
$
|
339.7
|
|
|
$
|
449.2
|
|
|
$
|
196.6
|
|
Licenses
|
185.1
|
|
|
87.3
|
|
|
191.1
|
|
|
79.3
|
|
||||
Customer relationships
|
33.8
|
|
|
0.6
|
|
|
—
|
|
|
—
|
|
||||
Trademarks
|
13.0
|
|
|
4.1
|
|
|
7.9
|
|
|
3.8
|
|
||||
Other
|
6.7
|
|
|
5.0
|
|
|
—
|
|
|
—
|
|
||||
Total
|
$
|
7,278.7
|
|
|
$
|
436.7
|
|
|
$
|
648.2
|
|
|
$
|
279.7
|
|
Non-Amortizable:
|
|
|
|
|
|
|
|
||||||||
Trademarks
|
$
|
35.0
|
|
|
|
|
$
|
35.0
|
|
|
|
||||
In-process research and development
|
235.2
|
|
|
|
|
18.6
|
|
|
|
||||||
Total
|
$
|
270.2
|
|
|
|
|
$
|
53.6
|
|
|
|
|
|
||
Fiscal 2015
|
$
|
496.5
|
|
Fiscal 2016
|
494.3
|
|
|
Fiscal 2017
|
492.4
|
|
|
Fiscal 2018
|
483.3
|
|
|
Fiscal 2019
|
483.0
|
|
12.
|
Debt
|
|
September 26, 2014
|
|
September 27, 2013
|
||||
Current maturities of long-term debt:
|
|
|
|
||||
2.85% term loan due April 2016
|
$
|
0.4
|
|
|
$
|
—
|
|
Term loan due March 2021
|
18.2
|
|
|
—
|
|
||
4.00% term loan due February 2022
|
1.2
|
|
|
—
|
|
||
Capital lease obligation
|
1.4
|
|
|
1.4
|
|
||
Loan payable
|
—
|
|
|
0.1
|
|
||
Total current debt
|
21.2
|
|
|
1.5
|
|
||
Long-term debt:
|
|
|
|
||||
Variable rate receivable securitization
|
150.0
|
|
|
—
|
|
||
2.85% term loan due April 2016
|
2.7
|
|
|
—
|
|
||
3.50% notes due April 2018
|
300.0
|
|
|
299.9
|
|
||
Term loan due March 2021
|
1,972.1
|
|
|
—
|
|
||
4.00% term loan due February 2022
|
9.6
|
|
|
—
|
|
||
9.50% debentures due May 2022
|
10.4
|
|
|
10.4
|
|
||
5.75% notes due August 2022
|
900.0
|
|
|
—
|
|
||
8.00% debentures due March 2023
|
8.0
|
|
|
8.0
|
|
||
4.75% notes due April 2023
|
598.3
|
|
|
598.2
|
|
||
Capital lease obligation
|
0.4
|
|
|
1.8
|
|
||
Total long-term debt
|
3,951.5
|
|
|
918.3
|
|
||
Total debt
|
$
|
3,972.7
|
|
|
$
|
919.8
|
|
Fiscal 2015
|
$
|
21.2
|
|
Fiscal 2016
|
24.3
|
|
|
Fiscal 2017
|
171.3
|
|
|
Fiscal 2018
|
321.3
|
|
|
Fiscal 2019
|
21.5
|
|
13.
|
Retirement Plans
|
|
Pension Benefits
|
|
Postretirement Benefits
|
||||||||||||||||||||
|
Fiscal Year
|
|
Fiscal Year
|
||||||||||||||||||||
|
2014
|
|
2013
|
|
2012
|
|
2014
|
|
2013
|
|
2012
|
||||||||||||
Service cost
|
$
|
5.1
|
|
|
$
|
5.0
|
|
|
$
|
5.0
|
|
|
$
|
0.1
|
|
|
$
|
0.1
|
|
|
$
|
0.1
|
|
Interest cost
|
19.6
|
|
|
18.2
|
|
|
21.2
|
|
|
2.1
|
|
|
2.4
|
|
|
3.1
|
|
||||||
Expected return on plan assets
|
(24.6
|
)
|
|
(29.6
|
)
|
|
(24.5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Amortization of net actuarial loss
|
8.1
|
|
|
12.3
|
|
|
11.7
|
|
|
—
|
|
|
0.3
|
|
|
0.2
|
|
||||||
Amortization of prior service cost
|
(0.6
|
)
|
|
0.6
|
|
|
0.7
|
|
|
(9.3
|
)
|
|
(9.1
|
)
|
|
(9.2
|
)
|
||||||
Plan settlements loss
|
3.8
|
|
|
6.8
|
|
|
(0.2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net periodic benefit cost (credit)
|
$
|
11.4
|
|
|
$
|
13.3
|
|
|
$
|
13.9
|
|
|
$
|
(7.1
|
)
|
|
$
|
(6.3
|
)
|
|
$
|
(5.8
|
)
|
|
Pension Benefits
|
|
Postretirement Benefits
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Change in benefit obligation:
|
|
|
|
|
|
|
|
||||||||
Projected benefit obligations at beginning of year
|
$
|
501.7
|
|
|
$
|
533.2
|
|
|
$
|
53.2
|
|
|
$
|
80.3
|
|
Service cost
|
5.1
|
|
|
5.0
|
|
|
0.1
|
|
|
0.1
|
|
||||
Interest cost
|
19.6
|
|
|
18.2
|
|
|
2.1
|
|
|
2.4
|
|
||||
Employee contributions
|
0.6
|
|
|
0.3
|
|
|
—
|
|
|
—
|
|
||||
Actuarial (gain) loss
|
60.0
|
|
|
(24.0
|
)
|
|
0.5
|
|
|
(9.3
|
)
|
||||
Benefits and administrative expenses paid
|
(21.9
|
)
|
|
(21.9
|
)
|
|
(3.9
|
)
|
|
(3.8
|
)
|
||||
Plan amendments
|
—
|
|
|
(9.0
|
)
|
|
—
|
|
|
(16.5
|
)
|
||||
Plan settlements
|
(17.6
|
)
|
|
(24.2
|
)
|
|
—
|
|
|
—
|
|
||||
Plan combinations
|
—
|
|
|
18.4
|
|
|
—
|
|
|
—
|
|
||||
Currency translation
|
(9.1
|
)
|
|
5.7
|
|
|
—
|
|
|
—
|
|
||||
Projected benefit obligations at end of year
|
$
|
538.4
|
|
|
$
|
501.7
|
|
|
$
|
52.0
|
|
|
$
|
53.2
|
|
|
|
|
|
|
|
|
|
||||||||
Change in plan assets:
|
|
|
|
|
|
|
|
||||||||
Fair value of plan assets at beginning of year
|
$
|
456.0
|
|
|
$
|
432.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Actual return on plan assets
|
59.7
|
|
|
17.3
|
|
|
—
|
|
|
—
|
|
||||
Employer contributions
|
4.9
|
|
|
44.4
|
|
|
3.9
|
|
|
3.8
|
|
||||
Employee contributions
|
0.6
|
|
|
0.3
|
|
|
—
|
|
|
—
|
|
||||
Benefits and administrative expenses paid
|
(21.9
|
)
|
|
(21.9
|
)
|
|
(3.9
|
)
|
|
(3.8
|
)
|
||||
Plan settlements
|
(17.6
|
)
|
|
(24.2
|
)
|
|
—
|
|
|
—
|
|
||||
Plan combinations
|
—
|
|
|
2.3
|
|
|
—
|
|
|
—
|
|
||||
Currency translation
|
(8.1
|
)
|
|
5.8
|
|
|
—
|
|
|
—
|
|
||||
Fair value of plan assets at end of year
|
$
|
473.6
|
|
|
$
|
456.0
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Funded status at end of year
|
$
|
(64.8
|
)
|
|
$
|
(45.7
|
)
|
|
$
|
(52.0
|
)
|
|
$
|
(53.2
|
)
|
|
Pension Benefits
|
|
Postretirement Benefits
|
||||||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||||||
Amounts recognized on the consolidated balance sheet:
|
|
|
|
|
|
|
|
||||||||
Non-current assets
|
$
|
9.8
|
|
|
$
|
17.1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Current liabilities
|
(2.7
|
)
|
|
(3.1
|
)
|
|
(4.8
|
)
|
|
(4.9
|
)
|
||||
Non-current liabilities
|
(71.9
|
)
|
|
(59.7
|
)
|
|
(47.2
|
)
|
|
(48.3
|
)
|
||||
Net amount recognized on the consolidated balance sheet
|
$
|
(64.8
|
)
|
|
$
|
(45.7
|
)
|
|
$
|
(52.0
|
)
|
|
$
|
(53.2
|
)
|
|
|
|
|
|
|
|
|
||||||||
Amounts recognized in accumulated other comprehensive income consist of:
|
|
|
|
|
|
|
|
||||||||
Net actuarial loss
|
$
|
(115.1
|
)
|
|
$
|
(102.9
|
)
|
|
$
|
(2.9
|
)
|
|
$
|
(2.4
|
)
|
Prior service credit (cost)
|
6.9
|
|
|
7.9
|
|
|
18.8
|
|
|
28.2
|
|
||||
Net amount recognized in accumulated other comprehensive income
|
$
|
(108.2
|
)
|
|
$
|
(95.0
|
)
|
|
$
|
15.9
|
|
|
$
|
25.8
|
|
|
Pension Benefits
|
|
Postretirement Benefits
|
||||
Amortization of net actuarial loss
|
$
|
9.4
|
|
|
$
|
—
|
|
Amortization of prior service cost
|
(0.6
|
)
|
|
(3.9
|
)
|
|
2014
|
|
2013
|
||||
Pension plans with accumulated benefit obligations in excess of plan assets:
|
|
|
|
||||
Accumulated benefit obligation
|
$
|
394.7
|
|
|
$
|
377.6
|
|
Fair value of plan assets
|
321.6
|
|
|
316.2
|
|
|
U.S. Plans
|
|
Non-U.S. Plans
|
||||||||||||||
|
2014
|
|
2013
|
|
2012
|
|
2014
|
|
2013
|
|
2012
|
||||||
Discount rate
|
4.2
|
%
|
|
3.5
|
%
|
|
4.4
|
%
|
|
3.5
|
%
|
|
4.0
|
%
|
|
5.2
|
%
|
Expected return on plan assets
|
6.5
|
%
|
|
7.9
|
%
|
|
7.5
|
%
|
|
3.1
|
%
|
|
3.5
|
%
|
|
4.0
|
%
|
Rate of compensation increase
|
—
|
%
|
|
—
|
%
|
|
2.8
|
%
|
|
3.5
|
%
|
|
3.7
|
%
|
|
3.7
|
%
|
|
U.S. Plans
|
|
Non-U.S. Plans
|
||||||||||||||
|
2014
|
|
2013
|
|
2012
|
|
2014
|
|
2013
|
|
2012
|
||||||
Discount rate
|
3.9
|
%
|
|
4.3
|
%
|
|
3.5
|
%
|
|
2.5
|
%
|
|
3.7
|
%
|
|
4.0
|
%
|
Rate of compensation increase
|
—
|
%
|
|
—
|
%
|
|
—
|
%
|
|
3.4
|
%
|
|
3.5
|
%
|
|
3.7
|
%
|
|
2014
|
|
2013
|
|
2012
|
|||
Net periodic benefit cost
|
4.0
|
%
|
|
3.2
|
%
|
|
4.1
|
%
|
Benefit obligations
|
3.7
|
%
|
|
4.0
|
%
|
|
3.2
|
%
|
|
2014
|
|
2013
|
||
Healthcare cost trend rate assumed for next fiscal year
|
7.1
|
%
|
|
7.3
|
%
|
Rate to which the cost trend rate is assumed to decline
|
4.5
|
%
|
|
4.5
|
%
|
Fiscal year the ultimate trend rate is achieved
|
2029
|
|
|
2029
|
|
|
One-Percentage-Point Increase
|
|
One-Percentage-Point Decrease
|
||||
Effect on total of service and interest cost
|
$
|
—
|
|
|
$
|
—
|
|
Effect on postretirement benefit obligation
|
0.4
|
|
|
(0.3
|
)
|
|
U.S. Plans
|
|
Non-U.S. Plans
|
||||||||
|
2014
|
|
2013
|
|
2014
|
|
2013
|
||||
Equity securities
|
28
|
%
|
|
42
|
%
|
|
8
|
%
|
|
7
|
%
|
Debt securities
|
70
|
|
|
56
|
|
|
2
|
|
|
3
|
|
Cash and cash equivalents
|
1
|
|
|
1
|
|
|
—
|
|
|
—
|
|
Other
|
1
|
|
|
1
|
|
|
90
|
|
|
90
|
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
|
|
Basis of Fair Value Measurement
|
||||||||||||
|
Fiscal 2014
|
|
Quoted Prices in Active Markets for Identical Assets (Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
||||||||
Equity Securities:
|
|
|
|
|
|
|
|
||||||||
U.S. small mid cap
|
$
|
16.6
|
|
|
$
|
16.6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
U.S. large cap
|
50.2
|
|
|
50.2
|
|
|
—
|
|
|
—
|
|
||||
International
|
39.8
|
|
|
28.7
|
|
|
11.1
|
|
|
—
|
|
||||
Debt securities:
|
|
|
|
|
|
|
|
||||||||
Diversified fixed income funds
(1)
|
218.7
|
|
|
216.6
|
|
|
2.1
|
|
|
—
|
|
||||
High yield bonds
|
13.0
|
|
|
13.0
|
|
|
—
|
|
|
—
|
|
||||
Emerging market funds
|
9.5
|
|
|
9.5
|
|
|
—
|
|
|
—
|
|
||||
Diversified/commingled funds
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Insurance contracts
|
119.8
|
|
|
—
|
|
|
—
|
|
|
119.8
|
|
||||
Other
|
6.0
|
|
|
2.6
|
|
|
3.4
|
|
|
—
|
|
||||
Total
|
$
|
473.6
|
|
|
$
|
337.2
|
|
|
$
|
16.6
|
|
|
$
|
119.8
|
|
|
|
|
Basis of Fair Value Measurement
|
||||||||||||
|
Fiscal 2013
|
|
Quoted Prices in Active Markets for Identical Assets (Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
||||||||
Equity Securities:
|
|
|
|
|
|
|
|
||||||||
U.S. small mid cap
|
$
|
19.3
|
|
|
$
|
19.3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
U.S. large cap
|
76.9
|
|
|
76.9
|
|
|
—
|
|
|
—
|
|
||||
International
|
52.2
|
|
|
43.9
|
|
|
8.3
|
|
|
—
|
|
||||
Debt securities:
|
|
|
|
|
|
|
|
||||||||
Diversified fixed income funds
(1)
|
170.0
|
|
|
166.7
|
|
|
3.3
|
|
|
—
|
|
||||
High yield bonds
|
11.7
|
|
|
11.7
|
|
|
—
|
|
|
—
|
|
||||
Emerging market funds
|
7.9
|
|
|
7.9
|
|
|
—
|
|
|
—
|
|
||||
Insurance contracts
|
112.0
|
|
|
—
|
|
|
—
|
|
|
112.0
|
|
||||
Other
|
6.0
|
|
|
3.1
|
|
|
2.9
|
|
|
—
|
|
||||
Total
|
$
|
456.0
|
|
|
$
|
329.5
|
|
|
$
|
14.5
|
|
|
$
|
112.0
|
|
(1)
|
Diversified fixed income funds consist of U.S. Treasury bonds, mortgage-backed securities, corporate bonds, asset-backed securities and U.S. agency bonds.
|
|
Insurance Contracts
|
||
Balance at September 28, 2012
|
$
|
105.1
|
|
Net unrealized gains
|
3.3
|
|
|
Net purchases, sales and issuances
|
(1.8
|
)
|
|
Currency translation
|
5.4
|
|
|
Balance at September 27, 2013
|
112.0
|
|
|
Net unrealized gains
|
15.5
|
|
|
Net purchases, sales and issuances
|
(0.6
|
)
|
|
Currency translation
|
(7.1
|
)
|
|
Balance at September 26, 2014
|
$
|
119.8
|
|
|
Pension Benefits
|
|
Postretirement Benefits
|
||||
Fiscal 2015
|
$
|
45.8
|
|
|
$
|
4.8
|
|
Fiscal 2016
|
34.9
|
|
|
4.5
|
|
||
Fiscal 2017
|
33.9
|
|
|
4.2
|
|
||
Fiscal 2018
|
33.4
|
|
|
4.0
|
|
||
Fiscal 2019
|
32.7
|
|
|
3.7
|
|
||
Fiscal 2020 - 2024
|
149.8
|
|
|
16.1
|
|
14.
|
Share Plans
|
|
Awards
|
|
Weighted-Average
Grant-Date
Fair Value
|
|||
Share options
|
2,399,822
|
|
|
$
|
7.96
|
|
Restricted share units
|
575,213
|
|
|
38.97
|
|
|
Shares Options
|
|
Weighted-
Average Exercise Price |
|
Weighted-
Average Remaining Contractual Term (in years) |
|
Aggregate
Intrinsic Value |
|||||
Outstanding at June 28, 2013
|
2,399,822
|
|
|
$
|
35.94
|
|
|
8.0
|
|
$
|
22.9
|
|
Exercisable at June 28, 2013
|
550,097
|
|
|
30.94
|
|
|
5.9
|
|
8.0
|
|
|
Pre- Separation
|
|
Post- Separation
|
||||
Expected share price volatility
|
26
|
%
|
|
32
|
%
|
||
Risk-free interest rate
|
0.99
|
%
|
|
0.99
|
%
|
||
Expected annual dividend per share
|
1.65
|
%
|
|
—
|
|
||
Expected life of options (in years)
|
3.8
|
|
|
3.8
|
|
||
Fair value per option
|
$
|
18.04
|
|
|
$
|
16.51
|
|
Share option awards
|
1,745,258
|
|
|
2,399,822
|
|
|
Share Options
|
|
Weighted-Average Exercise Price
|
|
Weighted-Average Remaining Contractual Term
(in years)
|
|
Aggregate Intrinsic Value
|
|||||
Outstanding at September 27, 2013
|
2,760,231
|
|
|
$
|
37.30
|
|
|
|
|
|
||
Granted
|
675,921
|
|
|
52.63
|
|
|
|
|
|
|||
Converted from Questcor Acquisition
|
1,292,736
|
|
|
25.08
|
|
|
|
|
|
|||
Exercised
|
(878,330
|
)
|
|
30.96
|
|
|
|
|
|
|||
Expired/Forfeited
|
(323,769
|
)
|
|
41.83
|
|
|
|
|
|
|||
Outstanding at September 26, 2014
|
3,526,789
|
|
|
36.84
|
|
|
6.4
|
|
$
|
187.5
|
|
|
|
|
|
|
|
|
|
|
|||||
Vested and unvested expected to vest as of September 26, 2014
|
3,362,751
|
|
|
36.27
|
|
|
6.5
|
|
180.7
|
|
||
Exercisable at September 26, 2014
|
832,680
|
|
|
31.32
|
|
|
4.7
|
|
48.8
|
|
|
2014
|
||
Expected share price volatility
|
32
|
%
|
|
Risk-free interest rate
|
1.96
|
%
|
|
Expected annual dividend per share
|
—
|
%
|
|
Expected life of options (in years)
|
5.5
|
|
|
Fair value per option
|
$
|
17.38
|
|
|
Shares
|
|
Weighted-Average
Grant-Date Fair Value
|
|||
Non-vested at June 28, 2013
|
724,269
|
|
|
$
|
40.62
|
|
Granted
|
229,281
|
|
|
55.40
|
|
|
Converted from Questcor Acquisition
|
30,747
|
|
|
70.88
|
|
|
Vested
|
(300,237
|
)
|
|
34.77
|
|
|
Forfeited
|
(94,838
|
)
|
|
42.48
|
|
|
Non-vested at September 26, 2014
|
589,222
|
|
|
47.88
|
|
|
2014
|
|
Expected stock price volatility
|
28
|
%
|
Peer group stock price volatility
|
33
|
%
|
Correlation of returns
|
17
|
%
|
|
Shares
|
|
Weighted-Average
Grant-Date Fair Value
|
|||
Non-vested at September 27, 2013
|
—
|
|
|
$
|
—
|
|
Granted
|
—
|
|
|
—
|
|
|
Converted from Questcor Acquisition
|
1,829,164
|
|
|
70.88
|
|
|
Vested
|
(390,731
|
)
|
|
70.88
|
|
|
Forfeited
|
(6,402
|
)
|
|
70.88
|
|
|
Non-vested at September 26, 2014
|
1,432,031
|
|
|
70.88
|
|
15.
|
Accumulated Other Comprehensive Income
|
|
Currency Translation
|
|
Unrecognized Loss on Derivatives
|
|
Unrecognized Gain (Loss) on Benefit Plans
|
|
Accumulated Other Comprehensive Income
|
||||||||
Balance at September 30, 2011
|
$
|
160.0
|
|
|
$
|
—
|
|
|
$
|
(61.5
|
)
|
|
$
|
98.5
|
|
Other comprehensive income (loss), net
|
(2.9
|
)
|
|
—
|
|
|
(10.7
|
)
|
|
(13.6
|
)
|
||||
Balance at September 28, 2012
|
157.1
|
|
|
—
|
|
|
(72.2
|
)
|
|
84.9
|
|
||||
Other comprehensive income (loss), net
|
1.5
|
|
|
(7.3
|
)
|
|
29.4
|
|
|
23.6
|
|
||||
Balance at September 27, 2013
|
158.6
|
|
|
(7.3
|
)
|
|
(42.8
|
)
|
|
108.5
|
|
||||
Other comprehensive loss before reclassification
|
(27.6
|
)
|
|
—
|
|
|
(17.1
|
)
|
|
(44.7
|
)
|
||||
Reclassification to other comprehensive income (loss)
|
—
|
|
|
0.5
|
|
|
1.4
|
|
|
1.9
|
|
||||
Balance at September 26, 2014
|
$
|
131.0
|
|
|
$
|
(6.8
|
)
|
|
$
|
(58.5
|
)
|
|
$
|
65.7
|
|
|
Amount Reclassified from
Accumulated Other Comprehensive Income
|
|
|
||
|
September 26, 2014
|
|
Line Item in the Condensed Consolidated
Statement of Income
|
||
Amortization of unrealized gain on derivatives
|
$
|
0.6
|
|
|
Interest expense
|
Income tax provision
|
(0.1
|
)
|
|
Provision for income taxes
|
|
Net of income taxes
|
0.5
|
|
|
|
|
|
|
|
|
||
Amortization of pension and post-retirement benefit plans:
|
|
|
|
||
Net actuarial loss
|
8.1
|
|
|
(1)
|
|
Prior service credit
|
(9.9
|
)
|
|
(1)
|
|
Plan settlements
|
3.8
|
|
|
(1)
|
|
Total before tax
|
2.0
|
|
|
|
|
Income tax provision
|
(0.6
|
)
|
|
Provision for income taxes
|
|
Net of income taxes
|
1.4
|
|
|
|
|
|
|
|
|
||
Total reclassifications for the period
|
$
|
1.9
|
|
|
|
(1)
|
These accumulated other comprehensive income components are included in the computation of net periodic benefit cost. See Note
13
for additional details.
|
16.
|
Transactions with Former Parent Company
|
17.
|
Guarantees
|
18.
|
Commitments and Contingencies
|
|
2014
|
|
2013
|
||||
Balance at beginning of period
|
$
|
50.6
|
|
|
$
|
46.4
|
|
Additions and adjustments
|
(11.6
|
)
|
|
0.4
|
|
||
Accretion expense
|
3.2
|
|
|
2.9
|
|
||
Payments
|
—
|
|
|
(0.2
|
)
|
||
Currency translation
|
(1.4
|
)
|
|
1.1
|
|
||
Balance at end of period
|
$
|
40.8
|
|
|
$
|
50.6
|
|
|
Operating Leases
|
|
Capital
Leases
|
||||
Fiscal 2015
|
$
|
21.5
|
|
|
$
|
1.4
|
|
Fiscal 2016
|
16.6
|
|
|
0.4
|
|
||
Fiscal 2017
|
13.9
|
|
|
—
|
|
||
Fiscal 2018
|
9.8
|
|
|
—
|
|
||
Fiscal 2019
|
8.2
|
|
|
—
|
|
||
Thereafter
|
25.0
|
|
|
—
|
|
||
Total minimum lease payments
|
$
|
95.0
|
|
|
1.8
|
|
|
Less: interest portion of payments
|
|
|
—
|
|
|||
Present value of minimum lease payments
|
|
|
$
|
1.8
|
|
19.
|
Financial Instruments and Fair Value Measurements
|
|
September 26,
2014 |
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Debt and equity securities held in rabbi trusts
|
$
|
35.7
|
|
|
$
|
22.9
|
|
|
$
|
12.8
|
|
|
$
|
—
|
|
|
$
|
35.7
|
|
|
$
|
22.9
|
|
|
$
|
12.8
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Deferred compensation liabilities
|
$
|
15.0
|
|
|
$
|
—
|
|
|
$
|
15.0
|
|
|
$
|
—
|
|
Contingent consideration and acquired contingent liabilities
|
202.8
|
|
|
—
|
|
|
—
|
|
|
202.8
|
|
||||
Foreign exchange forward and option contracts
|
0.2
|
|
|
0.2
|
|
|
—
|
|
|
—
|
|
||||
|
$
|
218.0
|
|
|
$
|
0.2
|
|
|
$
|
15.0
|
|
|
$
|
202.8
|
|
|
September 27,
2013 |
|
Quoted Prices in Active Markets for Identical Assets
(Level 1)
|
|
Significant Other Observable Inputs
(Level 2)
|
|
Significant Unobservable Inputs
(Level 3)
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Debt and equity securities held in rabbi trusts
|
$
|
35.3
|
|
|
$
|
22.6
|
|
|
$
|
12.7
|
|
|
$
|
—
|
|
Foreign exchange forward and option contracts
|
0.9
|
|
|
0.9
|
|
|
—
|
|
|
—
|
|
||||
|
$
|
36.2
|
|
|
$
|
23.5
|
|
|
$
|
12.7
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Deferred compensation liabilities
|
$
|
13.5
|
|
|
$
|
—
|
|
|
$
|
13.5
|
|
|
$
|
—
|
|
Contingent consideration
|
6.9
|
|
|
—
|
|
|
—
|
|
|
6.9
|
|
||||
Foreign exchange forward and option contracts
|
1.4
|
|
|
1.4
|
|
|
—
|
|
|
—
|
|
||||
|
$
|
21.8
|
|
|
$
|
1.4
|
|
|
$
|
13.5
|
|
|
$
|
6.9
|
|
Balance at September 27, 2013
|
$
|
6.9
|
|
Acquisition date fair value of acquired contingent liabilities
|
195.4
|
|
|
Accretion expense
|
1.1
|
|
|
Effect of currency rate change
|
(0.6
|
)
|
|
Balance at September 26, 2014
|
$
|
202.8
|
|
|
September 26, 2014
|
|
September 27, 2013
|
||||||||||||
|
Carrying
Value
|
|
Fair
Value
|
|
Carrying
Value
|
|
Fair
Value
|
||||||||
Loan payable
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
0.1
|
|
|
$
|
0.1
|
|
Variable rate receivable securitization
|
150.0
|
|
|
150.0
|
|
|
—
|
|
|
—
|
|
||||
2.85% term loan due April 2016
|
3.1
|
|
|
3.1
|
|
|
—
|
|
|
—
|
|
||||
3.50% notes due April 2018
|
300.0
|
|
|
290.2
|
|
|
299.9
|
|
|
293.7
|
|
||||
Term loans due March 2021
|
1,990.3
|
|
|
1,970.4
|
|
|
—
|
|
|
—
|
|
||||
4.00% term loan due February 2022
|
10.8
|
|
|
10.8
|
|
|
—
|
|
|
—
|
|
||||
9.50% debentures due May 2022
|
10.4
|
|
|
14.2
|
|
|
10.4
|
|
|
14.3
|
|
||||
5.75% notes due August 2022
|
900.0
|
|
|
907.3
|
|
|
—
|
|
|
—
|
|
||||
8.00% debentures due March 2023
|
8.0
|
|
|
10.2
|
|
|
8.0
|
|
|
10.2
|
|
||||
4.75% notes due April 2023
|
598.3
|
|
|
563.8
|
|
|
598.2
|
|
|
568.5
|
|
|
Fiscal Year
|
|||||||
|
2014
|
|
2013
|
|
2012
|
|||
Cardinal Health, Inc.
|
18
|
%
|
|
18
|
%
|
|
19
|
%
|
McKesson Corporation
|
17
|
%
|
|
15
|
%
|
|
14
|
%
|
Amerisource Bergen Corporation
|
11
|
%
|
|
9
|
%
|
|
9
|
%
|
|
September 26,
2014 |
|
September 27,
2013 |
||
Cardinal Health, Inc.
|
17
|
%
|
|
18
|
%
|
McKesson Corporation
|
24
|
%
|
|
22
|
%
|
Amerisource Bergen Corporation
|
13
|
%
|
|
14
|
%
|
CuraScript, Inc.
|
13
|
%
|
|
—
|
|
|
Fiscal Year
|
|||||||
|
2014
|
|
2013
|
|
2012
|
|||
Optiray (CMDS)
|
11
|
%
|
|
14
|
%
|
|
17
|
%
|
Acetaminophen products (API)
|
8
|
%
|
|
10
|
%
|
|
11
|
%
|
20.
|
Segment and Geographical Data
|
•
|
Specialty Pharmaceuticals
produces and markets branded pharmaceuticals and biopharmaceuticals, specialty generic pharmaceuticals and active pharmaceutical ingredients consisting of biologics, medicinal opioids, synthetic controlled substances, acetaminophen and other active ingredients; and
|
•
|
Global Medical Imaging
develops, manufactures and markets contrast media and delivery systems ("CMDS") and radiopharmaceuticals (nuclear medicine).
|
|
Fiscal Year
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Net sales:
|
|
|
|
|
|
||||||
Specialty Pharmaceuticals
|
$
|
1,612.9
|
|
|
$
|
1,217.6
|
|
|
$
|
1,005.2
|
|
Global Medical Imaging
|
881.5
|
|
|
935.7
|
|
|
996.8
|
|
|||
Net sales of operating segments
(1)
|
2,494.4
|
|
|
2,153.3
|
|
|
2,002.0
|
|
|||
Other
(2)
|
46.0
|
|
|
51.2
|
|
|
54.2
|
|
|||
Net sales
|
$
|
2,540.4
|
|
|
$
|
2,204.5
|
|
|
$
|
2,056.2
|
|
Operating income:
|
|
|
|
|
|
||||||
Specialty Pharmaceuticals
|
$
|
566.8
|
|
|
$
|
311.7
|
|
|
$
|
162.8
|
|
Global Medical Imaging
|
47.1
|
|
|
112.3
|
|
|
214.3
|
|
|||
Segment operating income
|
613.9
|
|
|
424.0
|
|
|
377.1
|
|
|||
Unallocated amounts:
|
|
|
|
|
|
||||||
Corporate and allocated expenses
(3)
|
(241.4
|
)
|
|
(133.8
|
)
|
|
(69.9
|
)
|
|||
Intangible asset amortization
|
(162.3
|
)
|
|
(35.4
|
)
|
|
(27.3
|
)
|
|||
Restructuring and related charges, net
(4)
|
(129.1
|
)
|
|
(35.8
|
)
|
|
(19.2
|
)
|
|||
Non-restructuring impairments
|
(355.6
|
)
|
|
—
|
|
|
—
|
|
|||
Separation costs
|
(9.6
|
)
|
|
(74.2
|
)
|
|
(25.5
|
)
|
|||
Operating (loss) income
|
$
|
(284.1
|
)
|
|
$
|
144.8
|
|
|
$
|
235.2
|
|
|
|
|
|
|
|
||||||
Total assets:
|
|
|
|
|
|
||||||
Specialty Pharmaceuticals
|
$
|
10,913.7
|
|
|
$
|
1,666.6
|
|
|
|
||
Global Medical Imaging
|
663.3
|
|
|
1,158.6
|
|
|
|
||||
Corporate
(5)
|
1,287.8
|
|
|
731.4
|
|
|
|
||||
Total assets
|
$
|
12,864.8
|
|
|
$
|
3,556.6
|
|
|
|
||
|
|
|
|
|
|
||||||
Depreciation and amortization
(6)
:
|
|
|
|
|
|
||||||
Specialty Pharmaceuticals
|
$
|
230.7
|
|
|
$
|
97.6
|
|
|
$
|
88.7
|
|
Global Medical Imaging
|
45.2
|
|
|
42.0
|
|
|
42.2
|
|
|||
Depreciation and amortization
|
$
|
275.9
|
|
|
$
|
139.6
|
|
|
$
|
130.9
|
|
(1)
|
Amounts represent sales to external customers. There were
no
intersegment sales.
|
(2)
|
Represents products that were sold to Covidien, which is discussed in Note 16.
|
(3)
|
Includes administration expenses and certain compensation, environmental and other costs not charged to the Company's operating segments.
|
(4)
|
Includes restructuring-related accelerated depreciation of
$0.5 million
,
$2.6 million
and
$8.0 million
for fiscal
2014
,
2013
and
2012
, respectively.
|
(5)
|
Consists of assets used in managing the Company's total business and not allocated to any one segment.
|
(6)
|
Depreciation for certain shared facilities is allocated based on occupancy percentage.
|
|
Fiscal Year
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Methylphenidate ER
|
$
|
209.6
|
|
|
$
|
148.3
|
|
|
$
|
—
|
|
Oxycodone (API) and oxycodone-containing tablets
|
155.2
|
|
|
139.0
|
|
|
144.1
|
|
|||
Hydrocodone (API) and hydrocodone-containing tablets
|
99.4
|
|
|
140.0
|
|
|
130.5
|
|
|||
Other controlled substances
|
584.5
|
|
|
443.3
|
|
|
439.5
|
|
|||
Other
|
150.7
|
|
|
140.6
|
|
|
134.7
|
|
|||
Specialty Generics and API
|
1,199.4
|
|
|
1,011.2
|
|
|
848.8
|
|
|||
Exalgo
|
76.1
|
|
|
126.1
|
|
|
91.9
|
|
|||
Offirmev
|
124.4
|
|
|
—
|
|
|
—
|
|
|||
Acthar
|
122.9
|
|
|
—
|
|
|
—
|
|
|||
Other
|
90.1
|
|
|
80.3
|
|
|
64.5
|
|
|||
Brands
|
413.5
|
|
|
206.4
|
|
|
156.4
|
|
|||
Specialty Pharmaceuticals
|
1,612.9
|
|
|
1,217.6
|
|
|
1,005.2
|
|
|||
|
|
|
|
|
|
||||||
Optiray
|
284.0
|
|
|
318.5
|
|
|
352.2
|
|
|||
Other
|
165.8
|
|
|
179.6
|
|
|
189.8
|
|
|||
Contrast Media and Delivery Systems
|
449.8
|
|
|
498.1
|
|
|
542.0
|
|
|||
Nuclear Imaging
|
431.7
|
|
|
437.6
|
|
|
454.8
|
|
|||
Global Medical Imaging
|
881.5
|
|
|
935.7
|
|
|
996.8
|
|
|||
|
|
|
|
|
|
||||||
Other
(1)
|
46.0
|
|
|
51.2
|
|
|
54.2
|
|
|||
Net sales
|
$
|
2,540.4
|
|
|
$
|
2,204.5
|
|
|
$
|
2,056.2
|
|
(1)
|
Represents products that were sold to Covidien, which is discussed in Note 16.
|
|
Fiscal Year
|
||||||||||
|
2014
|
|
2013
|
|
2012
|
||||||
Net sales
(1)
:
|
|
|
|
|
|
||||||
U.S.
|
$
|
1,899.8
|
|
|
$
|
1,518.7
|
|
|
$
|
1,350.2
|
|
Europe, Middle East and Africa
|
394.0
|
|
|
404.3
|
|
|
411.0
|
|
|||
Other
|
246.6
|
|
|
281.5
|
|
|
295.0
|
|
|||
|
$
|
2,540.4
|
|
|
$
|
2,204.5
|
|
|
$
|
2,056.2
|
|
Long-lived assets
(2)
:
|
|
|
|
|
|
||||||
U.S.
|
$
|
854.2
|
|
|
$
|
893.3
|
|
|
$
|
847.7
|
|
Europe, Middle East and Africa
(3)
|
61.9
|
|
|
81.0
|
|
|
72.2
|
|
|||
Other
|
57.4
|
|
|
51.8
|
|
|
52.1
|
|
|||
|
$
|
973.5
|
|
|
$
|
1,026.1
|
|
|
$
|
972.0
|
|
(1)
|
Net sales are attributed to regions based on the location of the entity that records the transaction, none of which relate to the country of Ireland.
|
(2)
|
Long-lived assets are primarily composed of property, plant and equipment.
|
(3)
|
Includes long-lived assets located in Ireland of
$26.9 million
,
$48.7 million
and
$45.5 million
at the end of fiscal
2014
,
2013
and
2012
, respectively.
|
21.
|
Selected Quarterly Financial Data (Unaudited)
|
|
Fiscal 2014 (by quarter)
|
||||||||||||||
|
Q1
|
|
Q2
|
|
Q3
|
|
Q4
|
||||||||
Net sales
|
$
|
540.2
|
|
|
$
|
557.8
|
|
|
$
|
653.1
|
|
|
$
|
789.3
|
|
Gross profit
|
255.6
|
|
|
262.6
|
|
|
284.3
|
|
|
400.6
|
|
||||
Income (loss) from continuing operations
|
46.4
|
|
|
11.7
|
|
|
(24.3
|
)
|
|
(352.4
|
)
|
||||
(Loss) income from discontinued operations
|
(0.8
|
)
|
|
(0.1
|
)
|
|
0.2
|
|
|
—
|
|
||||
Net income (loss)
|
45.6
|
|
|
11.6
|
|
|
(24.1
|
)
|
|
(352.4
|
)
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic earnings (loss) per share from continuing operations
(2)
|
$
|
0.80
|
|
|
$
|
0.20
|
|
|
$
|
(0.42
|
)
|
|
$
|
(4.14
|
)
|
Diluted earnings (loss) per share from continuing operations
(2)
|
0.79
|
|
|
0.20
|
|
|
(0.42
|
)
|
|
(4.14
|
)
|
||||
|
|||||||||||||||
|
Fiscal 2013 (by quarter)
|
||||||||||||||
|
Q1
|
|
Q2
|
|
Q3
(1)
|
|
Q4
|
||||||||
Net sales
|
$
|
504.0
|
|
|
$
|
585.3
|
|
|
$
|
570.0
|
|
|
$
|
545.2
|
|
Gross profit
|
233.5
|
|
|
273.5
|
|
|
265.8
|
|
|
252.1
|
|
||||
Income (loss) from continuing operations
|
19.8
|
|
|
34.5
|
|
|
(27.7
|
)
|
|
31.2
|
|
||||
(Loss) income from discontinued operations
|
(0.6
|
)
|
|
(0.5
|
)
|
|
(0.2
|
)
|
|
2.3
|
|
||||
Net income (loss)
|
19.2
|
|
|
34.0
|
|
|
(27.9
|
)
|
|
33.5
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Basic earnings (loss) per share from continuing operations
(2)(3)
|
$
|
0.34
|
|
|
$
|
0.60
|
|
|
$
|
(0.48
|
)
|
|
$
|
0.54
|
|
Diluted earnings (loss) per share from continuing operations
(2)(3)
|
0.34
|
|
|
0.60
|
|
|
(0.48
|
)
|
|
0.54
|
|
(1)
|
Operations in the third quarter of fiscal 2013 were impacted by the Separation.
|
(2)
|
Quarterly and annual computations are prepared independently. Therefore, the sum of each quarter may not necessarily total the fiscal period amounts noted elsewhere within this Annual Report on Form 10-K.
|
(3)
|
The computation of basic and diluted earnings per share assumes that the number of shares outstanding for the first three quarters of fiscal 2013 was equal to the number of ordinary shares of Mallinckrodt outstanding on June 28, 2013, immediately following the distribution of one ordinary share of Mallinckrodt for every eight ordinary shares of Covidien.
|
22.
|
Condensed Consolidating and Combining Financial Statements
|
|
Mallinckrodt plc
|
|
Mallinckrodt International Finance S.A.
|
|
Other Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
0.3
|
|
|
$
|
18.5
|
|
|
$
|
689.0
|
|
|
$
|
—
|
|
|
$
|
707.8
|
|
Accounts receivable, net
|
—
|
|
|
—
|
|
|
545.6
|
|
|
—
|
|
|
545.6
|
|
|||||
Inventories
|
—
|
|
|
—
|
|
|
396.6
|
|
|
—
|
|
|
396.6
|
|
|||||
Deferred income taxes
|
—
|
|
|
—
|
|
|
165.2
|
|
|
—
|
|
|
165.2
|
|
|||||
Prepaid expenses and other current assets
|
0.5
|
|
|
10.8
|
|
|
244.5
|
|
|
—
|
|
|
255.8
|
|
|||||
Intercompany receivable
|
13.5
|
|
|
—
|
|
|
25.7
|
|
|
(39.2
|
)
|
|
—
|
|
|||||
Total current assets
|
14.3
|
|
|
29.3
|
|
|
2,066.6
|
|
|
(39.2
|
)
|
|
2,071.0
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
—
|
|
|
949.2
|
|
|
—
|
|
|
949.2
|
|
|||||
Goodwill
|
—
|
|
|
—
|
|
|
2,401.9
|
|
|
—
|
|
|
2,401.9
|
|
|||||
Intangible assets, net
|
—
|
|
|
—
|
|
|
7,112.2
|
|
|
—
|
|
|
7,112.2
|
|
|||||
Investment in subsidiaries
|
586.8
|
|
|
10,645.7
|
|
|
4,945.1
|
|
|
(16,177.6
|
)
|
|
—
|
|
|||||
Intercompany loan receivable
|
4,385.0
|
|
|
—
|
|
|
1,941.6
|
|
|
(6,326.6
|
)
|
|
—
|
|
|||||
Other assets
|
—
|
|
|
76.5
|
|
|
254.0
|
|
|
—
|
|
|
330.5
|
|
|||||
Total Assets
|
$
|
4,986.1
|
|
|
$
|
10,751.5
|
|
|
$
|
19,670.6
|
|
|
$
|
(22,543.4
|
)
|
|
$
|
12,864.8
|
|
|
|
|
|
|
|
|
|
|
—
|
|
|||||||||
Liabilities and Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current maturities of long-term debt
|
$
|
—
|
|
|
$
|
18.2
|
|
|
$
|
3.0
|
|
|
$
|
—
|
|
|
$
|
21.2
|
|
Accounts payable
|
1.2
|
|
|
0.2
|
|
|
127.3
|
|
|
—
|
|
|
128.7
|
|
|||||
Accrued payroll and payroll-related costs
|
0.1
|
|
|
—
|
|
|
125.0
|
|
|
—
|
|
|
125.1
|
|
|||||
Accrued royalties
|
—
|
|
|
—
|
|
|
68.0
|
|
|
—
|
|
|
68.0
|
|
|||||
Accrued branded rebates
|
—
|
|
|
—
|
|
|
15.1
|
|
|
—
|
|
|
15.1
|
|
|||||
Accrued and other current liabilities
|
1.1
|
|
|
50.9
|
|
|
494.7
|
|
|
—
|
|
|
546.7
|
|
|||||
Intercompany payable
|
25.7
|
|
|
—
|
|
|
13.5
|
|
|
(39.2
|
)
|
|
—
|
|
|||||
Total current liabilities
|
28.1
|
|
|
69.3
|
|
|
846.6
|
|
|
(39.2
|
)
|
|
904.8
|
|
|||||
Long-term debt
|
—
|
|
|
3,770.4
|
|
|
181.1
|
|
|
—
|
|
|
3,951.5
|
|
|||||
Pension and postretirement benefits
|
—
|
|
|
—
|
|
|
119.1
|
|
|
—
|
|
|
119.1
|
|
|||||
Environmental liabilities
|
—
|
|
|
—
|
|
|
59.9
|
|
|
—
|
|
|
59.9
|
|
|||||
Deferred income taxes
|
—
|
|
|
—
|
|
|
2,398.6
|
|
|
—
|
|
|
2,398.6
|
|
|||||
Other income tax liabilities
|
—
|
|
|
—
|
|
|
122.6
|
|
|
—
|
|
|
122.6
|
|
|||||
Intercompany loans payable
|
—
|
|
|
1,966.6
|
|
|
4,360.0
|
|
|
(6,326.6
|
)
|
|
—
|
|
|||||
Other liabilities
|
—
|
|
|
—
|
|
|
350.3
|
|
|
—
|
|
|
350.3
|
|
|||||
Total liabilities
|
28.1
|
|
|
5,806.3
|
|
|
8,438.2
|
|
|
(6,365.8
|
)
|
|
7,906.8
|
|
|||||
Shareholders' equity
|
4,958.0
|
|
|
4,945.2
|
|
|
11,232.4
|
|
|
(16,177.6
|
)
|
|
4,958.0
|
|
|||||
Total Liabilities and Shareholders' Equity
|
$
|
4,986.1
|
|
|
$
|
10,751.5
|
|
|
$
|
19,670.6
|
|
|
$
|
(22,543.4
|
)
|
|
$
|
12,864.8
|
|
|
Mallinckrodt plc
|
|
Mallinckrodt International Finance S.A.
|
|
Other Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
1.2
|
|
|
$
|
56.5
|
|
|
$
|
217.8
|
|
|
$
|
—
|
|
|
$
|
275.5
|
|
Accounts receivable, net
|
—
|
|
|
—
|
|
|
400.8
|
|
|
—
|
|
|
400.8
|
|
|||||
Inventories
|
—
|
|
|
—
|
|
|
403.1
|
|
|
—
|
|
|
403.1
|
|
|||||
Deferred income taxes
|
—
|
|
|
—
|
|
|
171.1
|
|
|
—
|
|
|
171.1
|
|
|||||
Prepaid expenses and other current assets
|
1.0
|
|
|
—
|
|
|
133.4
|
|
|
—
|
|
|
134.4
|
|
|||||
Intercompany receivable
|
2.7
|
|
|
—
|
|
|
12.2
|
|
|
(14.9
|
)
|
|
—
|
|
|||||
Total current assets
|
4.9
|
|
|
56.5
|
|
|
1,338.4
|
|
|
(14.9
|
)
|
|
1,384.9
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
—
|
|
|
997.4
|
|
|
—
|
|
|
997.4
|
|
|||||
Goodwill
|
—
|
|
|
—
|
|
|
532.0
|
|
|
—
|
|
|
532.0
|
|
|||||
Intangible assets, net
|
—
|
|
|
—
|
|
|
422.1
|
|
|
—
|
|
|
422.1
|
|
|||||
Investment in subsidiaries
|
1,266.1
|
|
|
2,520.4
|
|
|
—
|
|
|
(3,786.5
|
)
|
|
—
|
|
|||||
Intercompany loan receivable
|
—
|
|
|
2.4
|
|
|
409.6
|
|
|
(412.0
|
)
|
|
—
|
|
|||||
Other assets
|
—
|
|
|
11.2
|
|
|
209.0
|
|
|
—
|
|
|
220.2
|
|
|||||
Total Assets
|
$
|
1,271.0
|
|
|
$
|
2,590.5
|
|
|
$
|
3,908.5
|
|
|
$
|
(4,213.4
|
)
|
|
$
|
3,556.6
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Liabilities and Shareholders' Equity
|
|
|
|
|
|
|
|
|
|
||||||||||
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current maturities of long-term debt
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1.5
|
|
|
$
|
—
|
|
|
$
|
1.5
|
|
Accounts payable
|
0.1
|
|
|
—
|
|
|
120.8
|
|
|
—
|
|
|
120.9
|
|
|||||
Accrued payroll and payroll-related costs
|
0.1
|
|
|
—
|
|
|
66.4
|
|
|
—
|
|
|
66.5
|
|
|||||
Accrued royalties
|
—
|
|
|
—
|
|
|
13.2
|
|
|
—
|
|
|
13.2
|
|
|||||
Accrued branded rebates
|
—
|
|
|
—
|
|
|
34.6
|
|
|
—
|
|
|
34.6
|
|
|||||
Accrued and other current liabilities
|
0.6
|
|
|
18.3
|
|
|
344.6
|
|
|
—
|
|
|
363.5
|
|
|||||
Intercompany payable
|
12.2
|
|
|
—
|
|
|
2.7
|
|
|
(14.9
|
)
|
|
—
|
|
|||||
Total current liabilities
|
13.0
|
|
|
18.3
|
|
|
583.8
|
|
|
(14.9
|
)
|
|
600.2
|
|
|||||
Long-term debt
|
—
|
|
|
898.1
|
|
|
20.2
|
|
|
—
|
|
|
918.3
|
|
|||||
Pension and postretirement benefits
|
—
|
|
|
—
|
|
|
108.0
|
|
|
—
|
|
|
108.0
|
|
|||||
Environmental liabilities
|
—
|
|
|
—
|
|
|
39.5
|
|
|
—
|
|
|
39.5
|
|
|||||
Deferred income taxes
|
—
|
|
|
—
|
|
|
310.1
|
|
|
—
|
|
|
310.1
|
|
|||||
Other income tax liabilities
|
—
|
|
|
—
|
|
|
153.1
|
|
|
—
|
|
|
153.1
|
|
|||||
Intercompany loans payable
|
2.4
|
|
|
409.6
|
|
|
—
|
|
|
(412.0
|
)
|
|
—
|
|
|||||
Other liabilities
|
—
|
|
|
—
|
|
|
171.8
|
|
|
—
|
|
|
171.8
|
|
|||||
Total liabilities
|
15.4
|
|
|
1,326.0
|
|
|
1,386.5
|
|
|
(426.9
|
)
|
|
2,301.0
|
|
|||||
Shareholders' equity
|
1,255.6
|
|
|
1,264.5
|
|
|
2,522.0
|
|
|
(3,786.5
|
)
|
|
1,255.6
|
|
|||||
Total Liabilities and Shareholders' Equity
|
$
|
1,271.0
|
|
|
$
|
2,590.5
|
|
|
$
|
3,908.5
|
|
|
$
|
(4,213.4
|
)
|
|
$
|
3,556.6
|
|
|
Mallinckrodt plc
|
|
Mallinckrodt International Finance S.A.
|
|
Other Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,540.4
|
|
|
$
|
—
|
|
|
$
|
2,540.4
|
|
Cost of sales
|
—
|
|
|
—
|
|
|
1,337.3
|
|
|
—
|
|
|
1,337.3
|
|
|||||
Gross profit
|
—
|
|
|
—
|
|
|
1,203.1
|
|
|
—
|
|
|
1,203.1
|
|
|||||
Selling, general and administrative expenses
|
38.6
|
|
|
7.3
|
|
|
796.2
|
|
|
—
|
|
|
842.1
|
|
|||||
Research and development expenses
|
—
|
|
|
—
|
|
|
166.9
|
|
|
—
|
|
|
166.9
|
|
|||||
Separation costs
|
2.5
|
|
|
—
|
|
|
7.1
|
|
|
—
|
|
|
9.6
|
|
|||||
Restructuring charges, net
|
35.3
|
|
|
—
|
|
|
93.3
|
|
|
—
|
|
|
128.6
|
|
|||||
Non-restructuring impairments
|
—
|
|
|
—
|
|
|
355.6
|
|
|
—
|
|
|
355.6
|
|
|||||
Gains on divestiture and license
|
—
|
|
|
—
|
|
|
(15.6
|
)
|
|
—
|
|
|
(15.6
|
)
|
|||||
Operating (loss) income
|
(76.4
|
)
|
|
(7.3
|
)
|
|
(200.4
|
)
|
|
—
|
|
|
(284.1
|
)
|
|||||
|
|
|
|
|
|
|
|
|
—
|
|
|||||||||
Interest expense
|
—
|
|
|
(86.3
|
)
|
|
—
|
|
|
3.7
|
|
|
(82.6
|
)
|
|||||
Interest income
|
—
|
|
|
—
|
|
|
5.2
|
|
|
(3.7
|
)
|
|
1.5
|
|
|||||
Other income (expense), net
|
30.9
|
|
|
—
|
|
|
(29.1
|
)
|
|
—
|
|
|
1.8
|
|
|||||
Intercompany interest and fees
|
(9.0
|
)
|
|
—
|
|
|
9.0
|
|
|
—
|
|
|
—
|
|
|||||
Equity in net income of subsidiaries
|
(264.8
|
)
|
|
(171.2
|
)
|
|
(300.2
|
)
|
|
736.2
|
|
|
—
|
|
|||||
Income (loss) from continuing operations before income taxes
|
(319.3
|
)
|
|
(264.8
|
)
|
|
(515.5
|
)
|
|
736.2
|
|
|
(363.4
|
)
|
|||||
Income tax expense (benefit)
|
—
|
|
|
—
|
|
|
(44.8
|
)
|
|
—
|
|
|
(44.8
|
)
|
|||||
Income (loss) from continuing operations
|
(319.3
|
)
|
|
(264.8
|
)
|
|
(470.7
|
)
|
|
736.2
|
|
|
(318.6
|
)
|
|||||
Loss from discontinued operations, net of income taxes
|
—
|
|
|
—
|
|
|
(0.7
|
)
|
|
—
|
|
|
(0.7
|
)
|
|||||
Net income (loss)
|
(319.3
|
)
|
|
(264.8
|
)
|
|
(471.4
|
)
|
|
736.2
|
|
|
(319.3
|
)
|
|||||
Other comprehensive loss, net of tax
|
(42.8
|
)
|
|
(42.8
|
)
|
|
(84.1
|
)
|
|
126.9
|
|
|
(42.8
|
)
|
|||||
Comprehensive income (loss)
|
$
|
(362.1
|
)
|
|
$
|
(307.6
|
)
|
|
$
|
(555.5
|
)
|
|
$
|
863.1
|
|
|
$
|
(362.1
|
)
|
|
Mallinckrodt plc
|
|
Mallinckrodt International Finance S.A.
|
|
Other Subsidiaries
|
|
Eliminations
|
|
Combined
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,204.5
|
|
|
$
|
—
|
|
|
$
|
2,204.5
|
|
Cost of sales
|
—
|
|
|
—
|
|
|
1,179.6
|
|
|
—
|
|
|
1,179.6
|
|
|||||
Gross profit
|
—
|
|
|
—
|
|
|
1,024.9
|
|
|
—
|
|
|
1,024.9
|
|
|||||
Selling, general and administrative expenses
|
5.4
|
|
|
0.1
|
|
|
604.4
|
|
|
—
|
|
|
609.9
|
|
|||||
Research and development expenses
|
—
|
|
|
—
|
|
|
165.7
|
|
|
—
|
|
|
165.7
|
|
|||||
Separation costs
|
3.2
|
|
|
0.6
|
|
|
70.4
|
|
|
—
|
|
|
74.2
|
|
|||||
Restructuring charges, net
|
—
|
|
|
—
|
|
|
33.2
|
|
|
—
|
|
|
33.2
|
|
|||||
Gains on divestiture and license
|
—
|
|
|
—
|
|
|
(2.9
|
)
|
|
—
|
|
|
(2.9
|
)
|
|||||
Operating (loss) income
|
(8.6
|
)
|
|
(0.7
|
)
|
|
154.1
|
|
|
—
|
|
|
144.8
|
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Interest expense
|
—
|
|
|
(19.6
|
)
|
|
0.1
|
|
|
—
|
|
|
(19.5
|
)
|
|||||
Interest income
|
—
|
|
|
—
|
|
|
0.3
|
|
|
—
|
|
|
0.3
|
|
|||||
Other income (expense), net
|
0.2
|
|
|
—
|
|
|
0.6
|
|
|
—
|
|
|
0.8
|
|
|||||
Intercompany interest and fees
|
(9.5
|
)
|
|
—
|
|
|
9.5
|
|
|
—
|
|
|
—
|
|
|||||
Equity in net income of subsidiaries
|
76.4
|
|
|
96.7
|
|
|
—
|
|
|
(173.1
|
)
|
|
—
|
|
|||||
Income from continuing operations before income taxes
|
58.5
|
|
|
76.4
|
|
|
164.6
|
|
|
(173.1
|
)
|
|
126.4
|
|
|||||
Income tax expense
|
(0.3
|
)
|
|
—
|
|
|
68.9
|
|
|
—
|
|
|
68.6
|
|
|||||
Income from continuing operations
|
58.8
|
|
|
76.4
|
|
|
95.7
|
|
|
(173.1
|
)
|
|
57.8
|
|
|||||
Loss from discontinued operations, net of income taxes
|
—
|
|
|
—
|
|
|
1.0
|
|
|
—
|
|
|
1.0
|
|
|||||
Net income
|
58.8
|
|
|
76.4
|
|
|
96.7
|
|
|
(173.1
|
)
|
|
58.8
|
|
|||||
Other comprehensive loss, net of tax
|
28.4
|
|
|
28.4
|
|
|
35.7
|
|
|
(64.1
|
)
|
|
28.4
|
|
|||||
Comprehensive income
|
$
|
87.2
|
|
|
$
|
104.8
|
|
|
$
|
132.4
|
|
|
$
|
(237.2
|
)
|
|
$
|
87.2
|
|
|
Mallinckrodt plc
|
|
Mallinckrodt International Finance S.A.
|
|
Other Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||
Cash Flows From Operating Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net cash (used in) provided by operating activities
|
$
|
18.2
|
|
|
$
|
(65.0
|
)
|
|
$
|
420.2
|
|
|
$
|
—
|
|
|
$
|
373.4
|
|
Cash Flows From Investing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Capital expenditures
|
—
|
|
|
—
|
|
|
(127.8
|
)
|
|
—
|
|
|
(127.8
|
)
|
|||||
Acquisitions and intangibles, net of cash acquired
|
—
|
|
|
—
|
|
|
(2,793.8
|
)
|
|
—
|
|
|
(2,793.8
|
)
|
|||||
Intercompany loan investment
|
(25.0
|
)
|
|
(298.1
|
)
|
|
(915.8
|
)
|
|
1,238.9
|
|
|
—
|
|
|||||
Subsidiary dividend proceeds
|
—
|
|
|
300.5
|
|
|
—
|
|
|
(300.5
|
)
|
|
—
|
|
|||||
Investment in subsidiary
|
—
|
|
|
(3,735.5
|
)
|
|
—
|
|
|
3,735.5
|
|
|
—
|
|
|||||
Restricted cash
|
—
|
|
|
—
|
|
|
4.1
|
|
|
—
|
|
|
4.1
|
|
|||||
Other
|
—
|
|
|
—
|
|
|
26.7
|
|
|
—
|
|
|
26.7
|
|
|||||
Net cash (used in) provided by investing activities
|
(25.0
|
)
|
|
(3,733.1
|
)
|
|
(3,806.6
|
)
|
|
4,673.9
|
|
|
(2,890.8
|
)
|
|||||
Cash Flows From Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Issuance of external debt
|
—
|
|
|
2,893.3
|
|
|
149.9
|
|
|
—
|
|
|
3,043.2
|
|
|||||
Repayment of external debt and capital leases
|
—
|
|
|
(3.3
|
)
|
|
(31.5
|
)
|
|
—
|
|
|
(34.8
|
)
|
|||||
Excess tax benefit from share-based compensation
|
—
|
|
|
—
|
|
|
8.9
|
|
|
—
|
|
|
8.9
|
|
|||||
Debt financing costs
|
—
|
|
|
(70.7
|
)
|
|
(1.0
|
)
|
|
—
|
|
|
(71.7
|
)
|
|||||
Net transfers to parent
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Proceeds from exercise of share options
|
25.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
25.8
|
|
|||||
Subsidiary dividend payment
|
—
|
|
|
—
|
|
|
(300.5
|
)
|
|
300.5
|
|
|
—
|
|
|||||
Intercompany loan borrowings
|
(2.4
|
)
|
|
940.8
|
|
|
300.5
|
|
|
(1,238.9
|
)
|
|
—
|
|
|||||
Capital contribution
|
—
|
|
|
—
|
|
|
3,735.5
|
|
|
(3,735.5
|
)
|
|
—
|
|
|||||
Repurchase of shares
|
(17.5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17.5
|
)
|
|||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Net cash provided by (used in) financing activities
|
5.9
|
|
|
3,760.1
|
|
|
3,861.8
|
|
|
(4,673.9
|
)
|
|
2,953.9
|
|
|||||
Effect of currency rate changes on cash
|
—
|
|
|
—
|
|
|
(4.2
|
)
|
|
—
|
|
|
(4.2
|
)
|
|||||
Net increase in cash and cash equivalents
|
(0.9
|
)
|
|
(38.0
|
)
|
|
471.2
|
|
|
—
|
|
|
432.3
|
|
|||||
Cash and cash equivalents at beginning of period
|
1.2
|
|
|
56.5
|
|
|
217.8
|
|
|
—
|
|
|
275.5
|
|
|||||
Cash and cash equivalents at end of period
|
0.3
|
|
|
18.5
|
|
|
689.0
|
|
|
—
|
|
|
707.8
|
|
|
Mallinckrodt plc
|
|
Mallinckrodt International Finance S.A.
|
|
Other Subsidiaries
|
|
Eliminations
|
|
Consolidated
|
||||||||||||
Cash Flows From Operating Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||||
Net cash (used in) provided by operating activities
|
$
|
(1.8
|
)
|
|
$
|
(8.4
|
)
|
|
$
|
146.1
|
|
|
$
|
—
|
|
|
$
|
135.9
|
|
||
Cash Flows From Investing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||||
Capital expenditures
|
—
|
|
|
—
|
|
|
(147.9
|
)
|
|
—
|
|
|
(147.9
|
)
|
|||||||
Acquisitions and intangibles, net of cash acquired
|
—
|
|
|
—
|
|
|
(88.1
|
)
|
|
—
|
|
|
(88.1
|
)
|
|||||||
Intercompany loan investment
|
—
|
|
|
(2.4
|
)
|
|
(409.6
|
)
|
|
412.0
|
|
|
—
|
|
|||||||
Investment in subsidiary
|
—
|
|
|
(68.0
|
)
|
|
—
|
|
|
68.0
|
|
|
—
|
|
|||||||
Other
|
—
|
|
|
—
|
|
|
1.3
|
|
|
—
|
|
|
1.3
|
|
|||||||
Net cash (used in) provided by investing activities
|
—
|
|
|
(70.4
|
)
|
|
(644.3
|
)
|
—
|
|
480.0
|
|
|
(234.7
|
)
|
||||||
Cash Flows From Financing Activities:
|
|
|
|
|
|
|
|
|
|
||||||||||||
Issuance of external debt
|
—
|
|
|
898.1
|
|
|
—
|
|
|
—
|
|
|
898.1
|
|
|||||||
Repayment of external debt and capital leases
|
—
|
|
|
—
|
|
|
(1.3
|
)
|
|
—
|
|
|
(1.3
|
)
|
|||||||
Excess tax benefit from share-based compensation
|
—
|
|
|
—
|
|
|
3.4
|
|
|
—
|
|
|
3.4
|
|
|||||||
Debt financing costs
|
—
|
|
|
(12.0
|
)
|
|
—
|
|
|
—
|
|
|
(12.0
|
)
|
|||||||
Net transfers to parent
|
—
|
|
|
(1,160.4
|
)
|
|
644.5
|
|
|
—
|
|
|
(515.9
|
)
|
|||||||
Proceeds from exercise of share options
|
0.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.6
|
|
|||||||
Intercompany loan borrowings
|
2.4
|
|
|
409.6
|
|
|
—
|
|
|
(412.0
|
)
|
|
—
|
|
|||||||
Capital contribution
|
—
|
|
|
—
|
|
|
68.0
|
|
|
(68.0
|
)
|
|
—
|
|
|||||||
Other
|
—
|
|
|
—
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
|||||||
Net cash provided by (used in) financing activities
|
3.0
|
|
|
135.3
|
|
—
|
|
714.7
|
|
|
(480.0
|
)
|
|
373.0
|
|
||||||
Effect of currency rate changes on cash
|
—
|
|
|
—
|
|
|
1.3
|
|
|
—
|
|
|
1.3
|
|
|||||||
Net increase in cash and cash equivalents
|
1.2
|
|
|
56.5
|
|
|
217.8
|
|
|
—
|
|
|
275.5
|
|
|||||||
Cash and cash equivalents at beginning of period
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Cash and cash equivalents at end of period
|
$
|
1.2
|
|
|
$
|
56.5
|
|
|
$
|
217.8
|
|
|
$
|
—
|
|
|
$
|
275.5
|
|
23.
|
Subsequent Events
|
Item 9.
|
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure.
|
Item 9A.
|
Controls and Procedures.
|
•
|
pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the Company’s assets;
|
•
|
provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that the Company’s receipts and expenditures are being made only in accordance with authorizations of the Company’s management and directors; and
|
•
|
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the Company’s assets that could have a material effect on the financial statements.
|
Item 9B.
|
Other Information.
|
•
|
40% of the target grant date fair value will be allocated to performance shares ("PSUs") with performance-based vesting over a three-year vesting period (September 27, 2014 up to and including September 29, 2017) based on total return of shareholders against a defined peer group (weighted 50%) and adjusted EBITDA margin as measured as of September 29, 2017 (weighted 50%). The actual number of PSUs will be determined on the Grant Date by taking the dollar value allocated to PSUs and dividing such amount by the grant date fair value of a PSU using, for 50% of the value, a Monte Carlo simulation model and for the remaining 50% of the value, the closing price of our ordinary shares on the Grant Date. Depending on Mallinckrodt's performance during the performance period, the named executive officer is entitled to receive a number of ordinary shares equal to a percentage, ranging from 0% to 200%, of the award granted.
|
•
|
40% of the target grant date fair value will be allocated to stock options vesting ratably over a four-year period on the anniversary of the Grant Date. The actual number of stock options will be determined on the Grant Date by taking the dollar value allocated to stock options and dividing such amount by the grant date fair value of an option using a Black-Scholes valuation model; and
|
•
|
20% of the target grant date fair value will be allocated to restricted stock units ("RSUs") vesting ratably over a four-year period on the anniversary of the Grant Date. The actual number of RSUs will be determined on the Grant Date by taking the dollar value allocated to RSUs and dividing such amount by Fair Market Value (as defined in the Mallinckrodt Pharmaceuticals Stock and Incentive Plan) of the Company's ordinary shares on the Grant Date.
|
Item 10.
|
Directors, Executive Officers and Corporate Governance.
|
Item 11.
|
Executive Compensation.
|
Item 12.
|
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
|
Item 13.
|
Certain Relationships and Related Transactions, and Director Independence.
|
Item 14.
|
Principal Accounting Fees and Services.
|
Item 15.
|
Exhibits, Financial Statement Schedules.
|
1)
|
Financial Statements
. The following are included within Item 8. Financial Statements and Supplementary Data of this Annual Report on Form 10-K.
|
•
|
Report of Independent Registered Public Accounting Firm
|
•
|
Consolidated Statement of Income for the fiscal year ended
September 26, 2014
and the Consolidated and Combined Statements of Income for the fiscal years ended
September 27, 2013
and
September 28, 2012
|
•
|
Consolidated Statement of Comprehensive Income for the fiscal year ended
September 26, 2014
and the Consolidated and Combined Statements of Comprehensive Income for the fiscal years ended
September 27, 2013
and
September 28, 2012
|
•
|
Consolidated Balance Sheets as of
September 26, 2014
and
September 27, 2013
|
•
|
Consolidated Statement of Cash Flows for the fiscal year ended
September 26, 2014
and the Consolidated and Combined Statements of Cash Flows for the fiscal years ended
September 27, 2013
and
September 28, 2012
|
•
|
Consolidated Statement of Changes in Shareholders' Equity for the period from
September 27, 2013
to
September 26, 2014
and the Consolidated and Combined Statement of Changes in Shareholders' Equity for the period from
September 30, 2011
to
September 27, 2013
|
•
|
Notes to Consolidated and Combined Financial Statements
|
2)
|
Financial Statement Schedules.
The financial statement schedule is included below. All other schedules have been omitted because they are not applicable, not required or the information in included in the financial statements or notes thereto.
|
Schedule II - Valuation and Qualifying Accounts
|
|
|
|
|
|
|
|
|
|
|
||||||||||
(in millions)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Description
|
|
Balance at Beginning of Period
|
|
Charged to Income
|
|
Additions and Other
|
|
Deductions
|
|
Balance at End of Period
|
||||||||||
Allowance for doubtful accounts:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fiscal year ended September 26, 2014
|
|
$
|
4.6
|
|
|
$
|
2.3
|
|
|
$
|
—
|
|
|
$
|
(0.3
|
)
|
|
$
|
6.6
|
|
Fiscal year ended September 27, 2013
|
|
9.4
|
|
|
1.4
|
|
|
—
|
|
|
(6.2
|
)
|
|
4.6
|
|
|||||
Fiscal year ended September 28, 2012
|
|
5.7
|
|
|
4.5
|
|
|
—
|
|
|
(0.8
|
)
|
|
9.4
|
|
|||||
Sales reserve accounts:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fiscal year ended September 26, 2014
|
|
$
|
322.9
|
|
|
$
|
1,846.8
|
|
|
$
|
30.6
|
|
|
$
|
(1,769.8
|
)
|
|
$
|
430.5
|
|
Fiscal year ended September 27, 2013
|
|
279.8
|
|
|
1,316.9
|
|
|
—
|
|
|
(1,273.8
|
)
|
|
322.9
|
|
|||||
Fiscal year ended September 28, 2012
|
|
271.2
|
|
|
1,157.8
|
|
|
—
|
|
|
(1,149.2
|
)
|
|
279.8
|
|
|||||
Tax valuation allowance:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fiscal year ended September 26, 2014
|
|
$
|
30.0
|
|
|
$
|
33.4
|
|
|
$
|
14.1
|
|
|
$
|
—
|
|
|
$
|
77.5
|
|
Fiscal year ended September 27, 2013
|
|
15.3
|
|
|
11.7
|
|
|
3.0
|
|
|
—
|
|
|
30.0
|
|
|||||
Fiscal year ended September 28, 2012
|
|
15.6
|
|
|
(0.3
|
)
|
|
—
|
|
|
—
|
|
|
15.3
|
|
3)
|
Exhibits.
The exhibits are included in the Exhibit Index that appears at the end of this Annual Report on Form 10-K.
|
|
MALLINCKRODT PUBLIC LIMITED COMPANY
|
|
|
|
|
Date: November 24, 2014
|
By:
|
/s/ Matthew K. Harbaugh
|
|
|
Matthew K. Harbaugh
Senior Vice President and Chief Financial Officer
(principal financial officer)
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
/s/ Mark C. Trudeau
|
|
President, Chief Executive Officer and Director
|
|
November 24, 2014
|
Mark C. Trudeau
|
|
(principal executive officer)
|
|
|
|
|
|
|
|
/s/ Matthew K. Harbaugh
|
|
Senior Vice President and Chief Financial Officer
|
|
November 24, 2014
|
Matthew K. Harbaugh
|
|
(principal financial officer)
|
|
|
|
|
|
|
|
/s/ Kathleen A. Schaefer
|
|
Vice President and Corporate Controller
|
|
November 24, 2014
|
Kathleen A. Schaefer
|
|
(principal accounting officer)
|
|
|
|
|
|
|
|
*
|
|
Chairman of the Board of Directors
|
|
November 24, 2014
|
Melvin D. Booth
|
|
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
November 24, 2014
|
Don M. Bailey
|
|
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
November 24, 2014
|
David R. Carlucci
|
|
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
November 24, 2014
|
J. Martin Carroll
|
|
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
November 24, 2014
|
Diane H. Gulyas
|
|
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
November 24, 2014
|
Nancy S. Lurker
|
|
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
November 24, 2014
|
JoAnn A. Reed
|
|
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
November 24, 2014
|
Angus C. Russell
|
|
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
November 24, 2014
|
Virgil D. Thompson
|
|
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
November 24, 2014
|
Kneeland C. Youngblood, M.D.
|
|
|
|
|
|
|
|
|
|
*
|
|
Director
|
|
November 24, 2014
|
Joseph A. Zaccagnino
|
|
|
|
|
/s/ Peter G. Edwards
|
|
Peter G. Edwards, Attorney-in-fact
|
|
Exhibit
Number
|
|
Exhibit
|
|
|
|
2.1
|
|
Separation and Distribution Agreement between Covidien plc and Mallinckrodt plc, dated June 28, 2013 (incorporated by reference to Exhibit 2.1 to the Company's Current Report on Form 8-K filed July 1, 2013).
|
2.2
|
|
Agreement and Plan of Merger, dated as of February 10, 2014, by and among Mallinckrodt plc, Madison Merger Sub, Inc. and Cadence Pharmaceuticals, Inc. (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed February 11, 2014).
|
2.3
|
|
Agreement and Plan of Merger, dated as of April 5, 2014, by and among Mallinckrodt plc, Quincy merger Sub, Inc. and Questcor Pharmaceuticals, Inc. (incorporated by reference to Exhibit 2.1 to the Company’s Current Report on Form 8-K filed April 7, 2014).
|
3.1
|
|
Certificate of Incorporation of Mallinckrodt plc (incorporated by reference to Exhibit 3.1 to the Company's Current Report on Form 8-K filed July 1, 2013).
|
3.2
|
|
Amended and Restated Memorandum and Articles of Association of Mallinckrodt plc (incorporated by reference to Exhibit 3.2 to the Company's Current Report on Form 8-K filed July 1, 2013).
|
4.1
|
|
Indenture, dated as of April 11, 2013, by and among Mallinckrodt International Finance S.A., Covidien International Finance S.A. and Deutsche Bank Trust Company Americas, as trustee (incorporated by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K filed July 1, 2013).
|
4.2
|
|
Supplemental Indenture, dated as of June 28, 2013, by and among Mallinckrodt plc, Mallinckrodt International Finance S.A. and Deutsche Bank Trust Company Americas, as trustee (incorporated by reference to Exhibit 4.3 to the Company's Current Report on Form 8-K filed July 1, 2013).
|
4.3
|
|
Indenture, dated as of August 13, 2014, among Mallinckrodt International Finance, S.A., Mallinckrodt CB LLC, the Guarantors party thereto from time to time and Deutsche Bank Trust Company Americas, as trustee (incorporated by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K filed August 14, 2014).
|
10.1
|
|
Tax Matters Agreement between Covidien plc and Mallinckrodt plc, dated June 28, 2013 (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed July 1, 2013).
|
10.2
|
|
Employee Matters Agreement between Covidien plc and Mallinckrodt plc, dated June 28, 2013 (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed July 1, 2013).
|
10.3
|
|
Transition Services Agreement between Covidien plc and Mallinckrodt plc, dated June 28, 2013 (incorporated by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed July 1, 2013).
|
10.4
|
|
Credit Agreement, dated as of March 19, 2014, among Mallinckrodt plc, Mallinckrodt International Finance S.A., Mallinckrodt CB LLC, the lenders party thereto from time to time and Deutsche Bank AG New York Branch, as Administrative Agent (incorporated herein by reference to Exhibit (b)(3) of the Schedule TO/A filed by Mallinckrodt plc and Madison Merger Sub, Inc. on March 19, 2014).
|
10.5
|
|
Note Purchase Agreement, dated as of July 28, 2014, among Mallinckrodt Securitization S.À R.L., the persons from time to time party thereto as purchasers, PNC Bank, National Association, as administrative agent, and Mallinckrodt LLC, as initial servicer (incorporated by reference to Exhibit 10.1 to the Company’s Current Report filed July 30. 2014).
|
10.6
|
|
Purchase and Sale Agreement, dated as of July 28, 2014, among the various entities party thereto from time to time as originators, Mallinckrodt LLC, as initial servicer, and Mallinckrodt Securitization S.À R.L., as buyer (incorporated by reference to Exhibit 10.2 to the Company’s Current Report filed July 30. 2014).
|
10.7
|
|
Sale Agreement, dated as of July 28, 2014, between Liebel-Flarsheim Company LLC and Mallinckrodt LLC (incorporated by reference to Exhibit 10.3 to the Company’s Current Report filed July 30. 2014).
|
10.8
|
|
Performance Guaranty, dated as of July 28, 2014, by Mallinckrodt International Finance S.A. in favor of PNC Bank, National Association, as administrative agent (incorporated by reference to Exhibit 10.4 to the Company’s Current Report filed July 30. 2014).
|
10.9
|
|
Incremental Assumption Agreement No. 1, dated as of August 14, 2014, among Mallinckrodt International Finance, S.A., Mallinckrodt CB LLC, the subsidiaries of MIFSA party thereto and Deutsche Bank AG New York Branch, as administrative agent, as acknowledged by and consented to by Mallinckrodt plc and Mallinckrodt Quincy S.à r.l. incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed August 14, 2014).
|
10.10
|
|
Form of Deed of Indemnification by and between Mallinckrodt plc and Directors and Secretary (incorporated by reference to Exhibit 10.4 to the Company's Current Report on Form 8-K filed July 1, 2013).
|
10.11
|
|
Form of Indemnification Agreement by and between Mallinckrodt Brand Pharmaceuticals, Inc. and Directors and Secretary (incorporated by reference to Exhibit 10.5 to the Company's Current Report on Form 8-K filed July 1, 2013).
|
10.12
|
|
IV APAP Agreement (U.S. and Canada), dated as of February 21, 2006, by and between Cadence Pharmaceuticals, Inc. and Bristol-Myers Squibb Company (incorporated by reference to Exhibit 10.11 to Amendment No. 2 of Cadence Pharmaceuticals, Inc.'s Registration Statement on Form S-1 filed September 25, 2006).
|
12.13
|
|
License Agreement, dated as of December 23, 2002, by and among SCR Pharmatop and Bristol-Myers Squibb Company (incorporated by reference to Exhibit 10.12 to Amendment No. 2 of Cadence Pharmaceuticals, Inc.'s Registration Statement on Form S-1 filed September 25, 2006).
|
10.14*
|
|
Mallinckrodt Pharmaceuticals Severance Plan for U.S. Officers and Executives dated May 1, 2014.
|
10.15*
|
|
Mallinckrodt Pharmaceuticals Change in Control Severance Plan for Certain U.S. Officers and Executives dated as of May 1, 2014.
|
10.16 *
|
|
Mallinckrodt plc Stock and Incentive Plan Terms and Conditions of Restricted Unit Award for Chief Executive Officer (incorporated by reference to Exhibit 10.8 to the Company's Current Report on Form 8-K filed July 1, 2013).
|
10.17*
|
|
Mallinckrodt plc Stock and Incentive Plan Terms and Conditions of Restricted Unit Award (incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q filed May 8, 2014).
|
10.18*
|
|
Mallinckrodt plc Stock and Incentive Plan Terms and Conditions of Option Award (incorporated by reference to Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q filed May 8, 2014).
|
10.19*
|
|
Mallinckrodt plc Stock and Incentive Plan Terms and Conditions of Performance Unit Award FY14-FY16 Performance Cycle (incorporated by reference to Exhibit 10.3 to the Company's Quarterly Report on Form 10-Q filed May 8, 2014).
|
10.20*
|
|
Letter Agreement dated as of August 27, 2013 by and between Mallinckrodt LLC and Frank Scholz.
|
21.1
|
|
Subsidiaries of Mallinckrodt plc.
|
23.1
|
|
Consent of Deloitte & Touche LLP.
|
24.1
|
|
Powers of Attorney
|
31.1
|
|
Certification of Chief Executive Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended.
|
31.2
|
|
Certification of Chief Financial Officer pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934, as amended.
|
32.1
|
|
Certifications of the Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101
|
|
The following materials from the Mallinckrodt plc Annual Report on Form 10-K for the fiscal year ended September 26, 2014 formatted in Extensible Business Reporting Language (XBRL): (i) the Consolidated and Combined Statements of Income, (ii) the Consolidated and Combined Statements of Comprehensive Income, (iii) the Consolidated Balance Sheets, (iv) the Consolidated and Combined Statements of Cash Flows, (v) the Consolidated and Combined Statements of Shareholders' Equity and (vi) related notes.
|
ARTICLE I
|
PURPOSE, INTENT AND TERM OF PLAN 1
|
Section 1.01
|
Purpose and Intent of the Plan 1
|
Section 1.02
|
Term of the Plan 1
|
Section 1.03
|
Adoption of the Plan 1
|
ARTICLE II
|
DEFINITIONS 2
|
Section 2.01
|
Alternative Position 2
|
Section 2.02
|
Annual Bonus 2
|
Section 2.03
|
Base Salary 2
|
Section 2.04
|
Board 2
|
Section 2.05
|
Cause 2
|
Section 2.06
|
Claim 3
|
Section 2.07
|
Claimant 3
|
Section 2.08
|
COBRA 3
|
Section 2.09
|
Code 3
|
Section 2.10
|
Committee 3
|
Section 2.11
|
Company 3
|
Section 2.12
|
Effective Date 3
|
Section 2.13
|
Eligible Employee 3
|
Section 2.14
|
Employee 3
|
Section 2.15
|
Employer 4
|
Section 2.16
|
ERISA 4
|
Section 2.17
|
Exchange Act 4
|
Section 2.18
|
Involuntary Termination 4
|
Section 2.20
|
Key Employee 4
|
Section 2.19
|
Named Appeals Fiduciary 4
|
Section 2.21
|
Officer 4
|
Section 2.22
|
Participant 4
|
Section 2.23
|
Permanent Disability 4
|
Section 2.24
|
Plan 5
|
Section 2.25
|
Plan Administrator 5
|
Section 2.26
|
Postponement Period 5
|
Section 2.27
|
Release 5
|
Section 2.28
|
Salary Continuation Benefits 5
|
Section 2.29
|
Separation 5
|
Section 2.30
|
Separation from Service 5
|
Section 2.31
|
Separation from Service Date 6
|
Section 2.32
|
Severance Benefits 6
|
Section 2.33
|
Severance Period 6
|
Section 2.34
|
Subsidiary 6
|
Section 2.35
|
Termination Date 6
|
Section 2.36
|
Voluntary Termination 6
|
|
i
|
|
ARTICLE III
|
PARTICIPATION AND ELIGIBILITY FOR BENEFITS 7
|
Section 3.01
|
Participation 7
|
Section 3.02
|
Conditions 7
|
ARTICLE IV
|
DETERMINATION OF SEVERANCE BENEFITS 9
|
Section 4.01
|
Amount of Severance Benefits Upon Involuntary Termination 9
|
Section 4.02
|
Voluntary Termination; Termination for Death or Permanent
|
Section 4.03
|
Termination for Cause 12
|
Section 4.04
|
Reduction of Severance Benefits 12
|
ARTICLE V
|
METHOD AND DURATION OF SEVERANCE BENEFIT PAYMENTS 13
|
Section 5.01
|
Method of Payment 13
|
Section 5.02
|
Other Arrangements 13
|
Section 5.03
|
Code Section 409A 13
|
Section 5.04
|
Termination of Eligibility for Benefits 14
|
ARTICLE VI
|
THE PLAN ADMINISTRATOR 15
|
Section 6.01
|
Authority and Duties 15
|
Section 6.02
|
Compensation of the Plan Administrator 15
|
Section 6.03
|
Records, Reporting and Disclosure 15
|
ARTICLE VII
|
AMENDMENT, TERMINATION AND DURATION 16
|
Section 7.01
|
Amendment, Suspension and Termination 16
|
Section 7.02
|
Duration 16
|
ARTICLE VIII
|
DUTIES OF THE COMPANY AND THE COMMITTEE 17
|
Section 8.01
|
Records 17
|
Section 8.02
|
Payment 17
|
Section 8.03
|
Discretion 17
|
ARTICLE IX
|
CLAIMS PROCEDURES 18
|
Section 9.01
|
Claim 18
|
Section 9.02
|
Initial Claim 18
|
Section 9.03
|
Appeals of Denied Administrative Claims 18
|
Section 9.04
|
Appointment of the Named Appeals Fiduciary 19
|
Section 9.05
|
Arbitration; Expenses 19
|
|
ii
#
|
|
ARTICLE X
|
MISCELLANEOUS 21
|
Section 10.01
|
Non-Alienation of Benefits 21
|
Section 10.02
|
Notices 21
|
Section 10.03
|
Successors 21
|
Section 10.04
|
Other Payments 21
|
Section 10.05
|
No Mitigation 21
|
Section 10.06
|
No Contract of Employment 21
|
Section 10.07
|
Severability of Provisions 21
|
Section 10.08
|
Heirs, Assigns, and Personal Representatives 22
|
Section 10.09
|
Headings, Captions and Titles 22
|
Section 10.10
|
Gender and Number 22
|
Section 10.11
|
Unfunded Plan 22
|
Section 10.12
|
Payments to Incompetent Persons 22
|
Section 10.13
|
Lost Payees 22
|
Section 10.14
|
Controlling Law 22
|
|
iii
#
|
|
|
1
|
|
|
2
|
|
|
3
|
|
|
4
|
|
|
5
|
|
|
6
|
|
|
7
|
|
|
8
|
|
|
9
|
|
|
10
|
|
|
11
|
|
|
12
|
|
|
13
|
|
|
14
|
|
|
15
|
|
|
16
|
|
|
17
|
|
|
18
|
|
|
19
|
|
|
20
|
|
|
21
|
|
|
22
|
|
Chief Executive Officer
|
24 month Severance Period
|
Executive Vice President and Chief Financial Officer, Senior Vice Presidents and Presidents of business whose annual revenue is $1.5 billion or more
|
18 month Severance Period
|
Any other Global Business Unit Presidents, any other Officer and any other Eligible Employee
|
12 month Severance Period
|
Chief Executive Officer
|
2x Annual Bonus
|
Executive Vice President and Chief Financial Officer, Senior Vice Presidents and Presidents of business whose annual revenue is $1.5 billion or more
|
1.5x Annual Bonus
|
Any other Global Business Unit Presidents, any other Officer and any other Eligible Employee
|
1x Annual Bonus
|
ARTICLE I
|
BACKGROUND, PURPOSE AND TERM OF PLAN 1
|
Section 1.01
|
Purpose and Intent of the Plan 1
|
Section 1.02
|
Term of the Plan 1
|
Section 1.03
|
Adoption of the Plan 1
|
ARTICLE II
|
DEFINITIONS 2
|
Section 2.01
|
“Annual Bonus” 2
|
Section 2.02
|
“Base Salary” 2
|
Section 2.03
|
“Board” 2
|
Section 2.04
|
“Cause” 2
|
Section 2.05
|
“Change in Control” 2
|
Section 2.06
|
“Change in Control Benefits” 3
|
Section 2.07
|
“Change in Control Termination” 3
|
Section 2.08
|
“COBRA” 3
|
Section 2.09
|
“Code” 3
|
Section 2.10
|
“Committee” 3
|
Section 2.11
|
“Company” 3
|
Section 2.12
|
“Effective Date” 3
|
Section 2.13
|
“Eligible Employee” 3
|
Section 2.14
|
“Employee” 4
|
Section 2.15
|
“Employer” 4
|
Section 2.16
|
“ERISA” 4
|
Section 2.17
|
“Exchange Act” 4
|
Section 2.18
|
“Executive Severance Plan” 4
|
Section 2.19
|
“Good Reason Resignation” 4
|
Section 2.20
|
“Involuntary Termination” 5
|
Section 2.21
|
“Key Employee” 5
|
Section 2.22
|
“Notice Pay” 5
|
Section 2.23
|
“Officer” 5
|
Section 2.24
|
“Participant” 5
|
Section 2.25
|
“Permanent Disability” 5
|
Section 2.26
|
“Plan” 5
|
Section 2.27
|
“Plan Administrator” 5
|
Section 2.28
|
“Postponement Period” 6
|
Section 2.29
|
“Release” 6
|
Section 2.30
|
“Separation from Service” 6
|
Section 2.31
|
“Separation from Service Date” 6
|
Section 2.32
|
“Severance Benefits” 6
|
Section 2.33
|
“Severance Period” 6
|
Section 2.34
|
“Subsidiary” 6
|
Section 2.35
|
“Successor” 6
|
Section 2.36
|
“Voluntary Resignation” 7
|
ARTICLE III
|
PARTICIPATION AND ELIGIBILITY FOR BENEFITS 7
|
Section 3.01
|
Participation 7
|
Section 3.02
|
Conditions 7
|
ARTICLE IV
|
DETERMINATION OF SEVERANCE BENEFITS 9
|
Section 4.01
|
Amount of Severance Benefits Upon Involuntary Termination
|
Section 4.02
|
Voluntary Resignation; Termination for Death or Permanent
|
Section 4.03
|
Termination for Cause 11
|
Section 4.04
|
Reduction of Severance Benefits 11
|
ARTICLE V
|
METHOD, DURATION AND LIMITATION OF SEVERANCE BENEFIT PAYMENTS 12
|
Section 5.01
|
Method of Payment 12
|
Section 5.02
|
Other Arrangements 12
|
Section 5.03
|
Code Section 409A 12
|
Section 5.04
|
Termination of Eligibility for Benefits 13
|
Section 5.05
|
Limitation on Benefits 14
|
ARTICLE VI
|
THE PLAN ADMINISTRATOR 15
|
Section 6.01
|
Authority and Duties 15
|
Section 6.02
|
Compensation of the Plan Administrator 15
|
Section 6.03
|
Records, Reporting and Disclosure 15
|
ARTICLE VII
|
AMENDMENT, TERMINATION AND DURATION 16
|
Section 7.01
|
Amendment, Suspension and Termination 16
|
Section 7.02
|
Duration 16
|
ARTICLE VIII
|
DUTIES OF THE COMPANY AND THE COMMITTEE 16
|
Section 8.01
|
Records 16
|
Section 8.02
|
Payment 16
|
Section 8.03
|
Discretion 16
|
ARTICLE IX
|
CLAIMS PROCEDURES 17
|
Section 9.01
|
Claim 17
|
Section 9.02
|
Initial Claim 17
|
Section 9.03
|
Appeals of Denied Administrative Claims 17
|
Section 9.04
|
Appointment of the Named Appeals Fiduciary 18
|
Section 9.05
|
Arbitration; Expenses 18
|
ARTICLE X
|
MISCELLANEOUS 19
|
Section 10.01
|
Non-Alienation of Benefits 19
|
Section 10.02
|
Notices 19
|
Section 10.03
|
Successors 19
|
Section 10.04
|
Other Payments 19
|
Section 10.05
|
No Mitigation 19
|
Section 10.06
|
No Contract of Employment 20
|
Section 10.07
|
Severability of Provisions 20
|
Section 10.08
|
Heirs, Assigns, and Personal Representatives 20
|
Section 10.09
|
Headings and Captions 20
|
Section 10.10
|
Gender and Number 20
|
Section 10.11
|
Unfunded Plan 20
|
Section 10.12
|
Payments to Incompetent Persons 20
|
Section 10.13
|
Lost Payees 20
|
Section 10.14
|
Controlling Law 20
|
APPENDIX Salary Continuation Schedule
|
A-1
|
|
1
|
|
|
2
|
|
|
3
|
|
|
4
|
|
|
5
|
|
|
6
|
|
|
7
|
|
|
8
|
|
|
9
|
|
|
10
|
|
|
11
|
|
|
12
|
|
|
13
|
|
|
14
|
|
|
15
|
|
|
16
|
|
|
17
|
|
|
18
|
|
|
19
|
|
|
20
|
|
President and Chief Executive Officer
|
24 month Severance Period
|
Executive Vice Presidents and Senior Vice Presidents
|
18 month Severance Period
|
Any other Eligible Employee
|
12 month Severance Period
|
President and Chief Executive Officer
|
2x Annual Bonus
|
Executive Vice Presidents and Senior Vice Presidents
|
1.5x Annual Bonus
|
Any other Eligible Employee
|
1x Annual Bonus
|
Name of Subsidiary
|
|
Jurisdiction of Formation
|
Mallinckrodt Medical Argentina Ltd., Argentinean Branch
|
|
Argentina
|
Mallinckrodt Australia Pty Ltd
|
|
Australia
|
Mallinckrodt Belgium BVBA
|
|
Belgium
|
Carnforth Limited
|
|
Bermuda
|
Mallinckrodt do Brasil, Ltda.
|
|
Brazil
|
101610 PEI, Inc.
|
|
Canada
|
BioVectra, Inc.
|
|
Canada
|
Liebel-Flarsheim Canada Inc.
|
|
Canada
|
Mallinckrodt Canada Holdings ULC
|
|
Canada
|
Mallinckrodt Canada ULC
|
|
Canada
|
Comercializadora Mallinckrodt Chile Limitada
|
|
Chile
|
Mallinckrodt Medical Consulting (Shanghai) Co., Ltd.
|
|
China
|
Mallinckrodt Medical Consulting (Shanghai) Co., Ltd. (Beijing Branch)
|
|
China
|
Mallinckrodt Colombia SAS
|
|
Colombia
|
Mallinckrodt Netherlands Holdings B.V., organizacní slozka
|
|
Czech Republic
|
Mallinckrodt Netherlands Holdings B.V. Holland (Denmark Branch)
|
|
Denmark
|
Mallinckrodt Netherlands Holdings B V Finland Branch
|
|
Finland
|
Mallinckrodt France S.a.r.l. (FKA-Covidien)
|
|
France
|
Dritte CORSA Verwaltungsgesellschaft GmbH
|
|
Germany
|
Mallinckrodt Deutschland GmbH
|
|
Germany
|
Mallinckrodt Deutschland Holdings GmbH
|
|
Germany
|
Mallinckrodt Hong Kong Limited
|
|
Hong Kong
|
Mallinckrodt Pharmaceuticals India Private Limited
|
|
India
|
Acthar IP
|
|
Ireland
|
Mallinckrodt IP
|
|
Ireland
|
Mallinckrodt Ireland Limited
|
|
Ireland
|
Mallinckrodt Medical Imaging - Ireland
|
|
Ireland
|
Mallinckrodt Pharmaceuticals Ireland Limited
|
|
Ireland
|
Mallinckrodt Quincy Limited
|
|
Ireland
|
Phoenixglade Limited
|
|
Ireland
|
Questcor International Limited
|
|
Ireland
|
Questcor Operations Limited
|
|
Ireland
|
Mallinckrodt Italia Spa
|
|
Italy
|
Mallinckrodt Japan Co. Ltd.
|
|
Japan
|
Mallinckrodt Korea Inc.
|
|
Korea
|
Mallinckrodt Group Sarl
|
|
Luxembourg
|
Mallinckrodt International Finance SA
|
|
Luxembourg
|
Mallinckrodt Lux IP Sarl
|
|
Luxembourg
|
Mallinckrodt Quincy Sarl
|
|
Luxembourg
|
Mallinckrodt Securitization Sarl
|
|
Luxembourg
|
Mallinckrodt Medical S.A. de C.V.
|
|
Mexico
|
Mallinckrodt Canada Cooperatie U.A.
|
|
Netherlands
|
Mallinckrodt Medical B.V.
|
|
Netherlands
|
Mallinckrodt Nederland B.V.
|
|
Netherlands
|
Mallinckrodt Netherlands Holdings BV
|
|
Netherlands
|
Mallinckrodt Petten Holdings B.V.
|
|
Netherlands
|
Mallinckrodt Radioisotopes B.V.
|
|
Netherlands
|
Mallinckrodt Netherlands Holdings B.V. (Norway Branch)
|
|
Norway
|
Mallinckrodt Panama Distribution, S.A.
|
|
Panama
|
Mallinckrodt Panama, S.A.
|
|
Panama
|
Mallinckrodt sp. z o.o.
|
|
Poland
|
Mallinckrodt Caribbean, Inc. (Puerto Rico Branch)
|
|
Puerto Rico
|
Mallinckrodt Netherlands Holdings B.V. Russian Representative Office
|
|
Russia
|
Mallinckrodt Netherlands Holdings B.V. Slovakia, organizacná zlozka
|
|
Slovakia
|
Mallinckrodt (Pty) Ltd
|
|
South Africa
|
Mallinckrodt Spain, S.L.
|
|
Spain
|
Mallinckrodt Sverige AB
|
|
Sweden
|
Mallinckrodt Finance GmbH
|
|
Switzerland
|
Mallinckrodt AG
|
|
Switzerland
|
Mallinckrodt Group Sarl, Luxembourg (LU) Neuhausen AM Rheinfall Branch
|
|
Switzerland
|
Mallinckrodt Holdings GmbH
|
|
Switzerland
|
Name of Subsidiary
|
|
Jurisdiction of Formation
|
Mallinckrodt Switzerland Limited
|
|
Switzerland
|
Mallinckrodt Hong Kong Limited, Taiwan Representative Office
|
|
Taiwan
|
Mallinckrodt Hong Kong Limited, Thailand Branch
|
|
Thailand
|
Mallinckrodt Saglik Anonim Sirketi
|
|
Turkey
|
Mallinckrodt ARD Holdings Limited (FKA MIFSA UK Limited)
|
|
UK
|
Mallinckrodt Chemical Holdings (UK) Ltd.
|
|
UK
|
Mallinckrodt Chemical Limited
|
|
UK
|
Mallinckrodt Enterprises UK Limited
|
|
UK
|
Mallinckrodt Medical Argentina Ltd.
|
|
UK
|
Mallinckrodt Medical Holdings (UK) Limited
|
|
UK
|
Mallinckrodt UK Commercial Ltd
|
|
UK
|
Mallinckrodt UK Ltd
|
|
UK
|
MKG Medical UK Ltd
|
|
UK
|
MUSHI UK Holdings Limited
|
|
UK
|
BioVectra, Inc. USA
|
|
North Carolina
|
Cadence Pharmaceuticals, Inc.
|
|
Delaware
|
CNS Therapeutics, Inc.
|
|
Delaware
|
Enterpises Holdings, Inc.
|
|
Delaware
|
IMC Exploration Company
|
|
Maryland
|
Lafayette Pharmaceuticals LLC
|
|
Delaware
|
Liebel-Flarsheim Company LLC
|
|
Delaware
|
Ludlow Corporation
|
|
Massachusetts
|
Mallinckrodt APAP LLC
|
|
Delaware
|
Mallinckrodt ARD Holdings Inc.
|
|
Delaware
|
Mallinckrodt Brand Pharmaceuticals, Inc. (DE)
|
|
Delaware
|
Mallinckrodt Caribbean, Inc.
|
|
Delaware
|
Mallinckrodt CB LLC
|
|
Delaware
|
Mallinckrodt Enterprises Holdings, Inc.
|
|
California
|
Mallinckrodt Enterprises LLC
|
|
Delaware
|
Mallinckrodt Inc. (DE)
|
|
Delaware
|
Mallinckrodt LLC
|
|
Delaware
|
Mallinckrodt MFC LLC
|
|
Delaware
|
Mallinckrodt Nuclear LLC
|
|
Delaware
|
Mallinckrodt Nuclear Medicine LLC
|
|
Delaware
|
Mallinckrodt US Holdings, Inc. (FKA Kendall Holding Corp.)
|
|
Nevada
|
Mallinckrodt US Holdings LLC
|
|
Delaware
|
Mallinckrodt US Pool LLC
|
|
Nevada
|
Mallinckrodt Veterinary, Inc.
|
|
Delaware
|
MEH, Inc.
|
|
Nevada
|
Questcor Pharmaceuticals Inc.
|
|
California
|
Ribogene, Inc.
|
|
Delaware
|
Viking Project Company, LLC
|
|
Delaware
|
Signature
|
|
Title
|
|
Date
|
|
|
|
|
|
|
|
President, Chief Executive Officer and Director
|
|
|
Mark C. Trudeau
|
|
(principal executive officer)
|
|
|
|
|
|
|
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
Matthew K. Harbaugh
|
|
(principal financial officer)
|
|
|
|
|
|
|
|
|
|
Vice President Controller
|
|
|
Kathleen A. Schaefer
|
|
(principal accounting officer)
|
|
|
|
|
|
|
|
/s/ Melvin D. Booth
|
|
Chairman of the Board of Directors
|
|
November 24, 2014
|
Melvin D. Booth
|
|
|
|
|
|
|
|
|
|
/s/ Don M. Bailey
|
|
Director
|
|
November 24, 2014
|
Don M. Bailey
|
|
|
|
|
|
|
|
|
|
/s/ David R. Carlucci
|
|
Director
|
|
November 24, 2014
|
David R. Carlucci
|
|
|
|
|
|
|
|
|
|
/s/ J. Martin Carroll
|
|
Director
|
|
November 24, 2014
|
J. Martin Carroll
|
|
|
|
|
|
|
|
|
|
/s/ Diane H. Gulyas
|
|
Director
|
|
November 24, 2014
|
Diane H. Gulyas
|
|
|
|
|
|
|
|
|
|
/s/ Nancy S. Lurker
|
|
Director
|
|
November 24, 2014
|
Nancy S. Lurker
|
|
|
|
|
|
|
|
|
|
/s/ JoAnn A. Reed
|
|
Director
|
|
November 24, 2014
|
JoAnn A. Reed
|
|
|
|
|
|
|
|
|
|
/s/ Angus C. Russell
|
|
Director
|
|
November 24, 2014
|
Angus C. Russell
|
|
|
|
|
|
|
|
|
|
/s/ Virgil D. Thompson
|
|
Director
|
|
November 24, 2014
|
Virgil D. Thompson
|
|
|
|
|
|
|
|
|
|
/s/ Kneeland C. Youngblood
|
|
Director
|
|
November 24, 2014
|
Kneeland C. Youngblood
|
|
|
|
|
|
|
|
|
|
/s/ Joseph A. Zaccagnino
|
|
Director
|
|
November 24, 2014
|
Joseph A. Zaccagnino
|
|
|
|
|
|
|
||||
1.
|
I have reviewed this annual report on Form 10-K of Mallinckrodt plc;
|
||||
|
|
||||
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
||||
|
|
||||
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
||||
|
|
||||
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in the Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:
|
||||
|
|
||||
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
||||
|
|
|
|||
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
|||
|
|
||||
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
||||
|
|
||||
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
||||
|
|
||||
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
||||
|
|
||||
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
||||
|
|
||||
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date: November 24, 2014
|
|
By:
|
/s/ Mark C. Trudeau
|
|
|
Mark C. Trudeau
|
|
|
|
President and Chief Executive Officer
(principal executive officer)
|
|
|
||||
1.
|
I have reviewed this annual report on Form 10-K of Mallinckrodt plc;
|
||||
|
|
||||
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
||||
|
|
||||
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in the Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and we have:
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a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
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b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
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|
|
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c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
||||
|
|
||||
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
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|
|
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5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
||||
|
|
||||
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
||||
|
|
||||
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
Date: November 24, 2014
|
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By:
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/s/ Matthew K. Harbaugh
|
|
|
Matthew K. Harbaugh
|
|
|
|
Senior Vice President and Chief Financial Officer
(principal financial officer)
|
By:
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/s/ Mark C. Trudeau
|
Mark C. Trudeau
|
|
President and Chief Executive Officer
|
By:
|
/s/ Matthew K. Harbaugh
|
Matthew K. Harbaugh
|
|
Senior Vice President and Chief Financial Officer
|