Restructuring and Other Items

Restructuring and other items consisted of:



($ in millions)	2013			2012			2011
Restructuring and related charges (reversals):
Severance and post-employment benefits	$	—		$	(1.2	)	$	2.3
Impairments and asset write-offs	—			2.4			—
Other restructuring charges	—			0.9			3.0
Total restructuring and related charges	—			2.1			5.3
Impairment charge	—			3.4			—
Development income	(2.0		)	(6.5		)	—
Acquisition-related contingencies	1.0			1.2			(0.2		)
Special separation benefits	—			—			2.9
Foreign exchange and other	0.5			1.1			1.5
Total restructuring and other items	$	(0.5	)	$	1.3		$	9.5

Restructuring and Related Charges

All restructuring charges incurred in 2012 and 2011 were associated with the restructuring plan that was announced in 2010. In addition, during 2012, reductions were made to certain previously-recorded obligations under the 2010 plan, including a $1.7 million reduction following the cancellation of a restructuring initiative at one of our European plants as a result of increased customer demand and related efficiency improvements.

Also during 2012, we finalized an agreement concerning future manufacturing and supply requirements at our manufacturing facility in England, which triggered an impairment review of the related assets. Our review concluded that the estimated fair value of these assets no longer exceeded their carrying value and therefore, an impairment charge of $1.5 million was recorded. We estimated the fair value of the assets using an income approach based on discounted cash flows.

We incurred a total of $21.9 million in restructuring and related charges as part of the 2010 plan. The plan and related activities were completed during 2013.

The following table presents activity related to our restructuring obligations:



($ in millions)	Severance and benefits			Other Costs			Total
Balance, December 31, 2011	$	6.2		$	0.6		$	6.8
Charges (reversals), net	(1.2		)	3.3			2.1
Cash payments	(2.6		)	(1.4		)	(4.0		)
Non-cash adjustments	0.4			(2.5		)	(2.1		)
Balance, December 31, 2012	$	2.8		$	—		$	2.8
Cash payments	(2.8		)	—			(2.8		)
Balance, December 31, 2013	$	—		$	—		$	—

During 2011, as a result of the closure of a plant in Montgomery, Pennsylvania, we recorded a $0.2 million net curtailment gain related to our U.S. qualified and postretirement medical plans.

Other Items

During 2013, we recorded development income of $2.0 million within Delivery Systems. Included in this amount was $1.0 million of income related to a nonrefundable payment of $20.0 million received from a customer in June 2013 in return for the exclusive use of SmartDose within a specific therapeutic area. Unearned income related to this payment of $1.5 million and $17.5 million was included within other current liabilities and other long-term liabilities, respectively, at December 31, 2013. The unearned income is being recognized as development income on a straight-line basis over the remaining thirteen-year term of the agreement. The agreement does not include a future minimum purchase commitment from the customer. Development income recorded within Delivery Systems during 2012 was primarily attributable to services and the reimbursement of certain costs.

The liability for contingent consideration related to our 2010 acquisition of SmartDose technology increased by $1.0 million, $1.2 million and $0.5 million during 2013, 2012 and 2011, respectively, due to the time value of money and adjustments related to changes in sales projections. During 2011, we also reduced our éris contingent consideration by $0.8 million, bringing the liability balance to zero. This reduction reflects our assessment that none of the contractual operating targets will be achieved over the earnout period, which ends in 2014.

In addition, during 2012, as a result of continuing delays and lower-than-expected demand, we updated the sales projections related to one of our product lines in Delivery Systems. The revised projections triggered an impairment review of the associated assets. Our review concluded that the estimated fair value of the product no longer exceeded the carrying value of the related assembly equipment and intangible asset and, therefore, an impairment charge of $3.4 million was recorded. We estimated the fair value of the asset group using an income approach based on discounted cash flows.

During 2011, we incurred $2.9 million in special separation benefits related to the retirement of our former President and Chief Operating Officer. These costs consisted primarily of stock-based compensation expense and a settlement loss related to one of our non-qualified defined benefit pension plans. The respective equity compensation arrangements were amended to allow certain of his awards to continue to vest over the original vesting period instead of being forfeited upon separation, resulting in a revaluation of the awards and acceleration of expense.