Segment Information

6 Months Ended

Jun. 30, 2015

Segment Reporting [Abstract]

Segment Information

14. Segment Information

The Company is managed through two reportable segments, Clinical and Commercial. Each reportable business segment is comprised of multiple divisions and business units that, through their combination, create a fully integrated biopharmaceutical outsourced services provider. Clinical, which primarily serves pharmaceutical, biotechnology, diagnostic and medical device clients engaged in research and development, provides a continuum of services spanning phases I-IV of clinical development. Commercial, provides commercialization, patient outcomes and consulting services to the pharmaceutical, biotechnology and healthcare industries. In the fourth quarter of 2014, the Company realigned its segment reporting structure to reflect changes in its management structure. As a result of these changes, the Commercial segment includes the results of the consulting business, previously reported separately as the Consulting segment. Additionally, during 2014 certain business units previously reported under the Commercial segment were operationally moved into and are now reported under the Clinical segment, certain segment leadership costs previously included in Corporate and other were allocated to the Commercial segment and certain information technology costs previously allocated to the segments will remain in Corporate and other. As a result, previously reported segment information has been restated to conform to management’s current operating structure.

Management measures and evaluates the Company’s operating segments based on segment net revenue and adjusted operating income. The results of these reportable business segments are regularly reviewed by the Company’s chief operating decision maker, the Chief Executive Officer. Certain amounts that management considers to be non-operational are excluded from segment operating income because management evaluates the operating results of the segments excluding such charges. These items include depreciation and amortization; certain foreign currency impacts; net charges associated with acquisitions; certain legal charges, net of insurance recoveries; certain asset impairment charges; stock-based compensation; as well as corporate and other unallocated expenses. The corporate and other unallocated expenses primarily consist of expenses for corporate overhead functions such as finance, human resources, information technology, facilities and legal; restructuring and related charges; and certain expenses incurred in connection with the management agreements with affiliates of certain shareholders of the Parent. Although these amounts are excluded from segment operating income, as applicable, they are included in reported consolidated operating loss and in the reconciliations presented below. The Company has not presented segment assets since management does not evaluate the Company’s operating segments using this information.

Selected information for each reportable segment is as follows (in thousands):

	Three Months Ended June 30,						Six Months Ended June 30,
	2015			2014			2015			2014
Net Revenues
Clinical	$	233,582		$	218,146		$	453,246		$	432,974
Commercial		258,664			232,831			492,737			441,538
Intersegment revenues		(2,829	)		(1,408	)		(5,589	)		(3,138	)
Consolidated net revenues	$	489,417		$	449,569		$	940,394		$	871,374
Adjusted Segment Operating Income (Loss)
Clinical	$	28,469		$	21,527		$	54,118		$	44,862
Commercial		42,112			28,351			73,594			51,958
Reportable segments adjusted operating income (loss)		70,581			49,878			127,712			96,820
Depreciation and amortization		(23,908	)		(27,072	)		(48,911	)		(53,582	)
Stock-based compensation		(45	)		(118	)		(515	)		(444	)
Corporate and other unallocated charges		(16,996	)		(11,046	)		(31,096	)		(22,726	)
Operating income (loss)	$	29,632		$	11,642		$	47,190		$	20,068
Interest income (expense), net		(57,120	)		(53,232	)		(113,583	)		(105,684	)
Income (loss) before income tax (provision) benefit and income (loss) from equity investments.	$	(27,488	)	$	(41,590	)	$	(66,393	)	$	(85,616	)