Fair Value Measurements (Tables)

9 Months Ended

Sep. 29, 2018

Fair Value, Assets Measured on Recurring and Nonrecurring Basis

The following table summarizes the valuation of our financial instruments carried at fair value and measured at fair value on a recurring and non-recurring basis by the above pricing categories (in millions):



	September 29, 2018						December 31, 2017
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Measured at fair value on a recurring basis:
Assets:
Investment securities	$	7.0	$	—	$	—	$	17.0	$	—	$	—
Foreign currency forward contracts	—		3.3		—		—		6.3		—
Funds associated with Israeli severance liability	—		14.2		—		—		16.3		—
Royalty Pharma contingent milestone payments	—		—		200.4		—		—		134.5
Total assets	$	7.0	$	17.5	$	200.4	$	17.0	$	22.6	$	134.5

Liabilities:
Foreign currency forward contracts	$	—	$	6.6	$	—	$	—	$	3.8	$	—
Contingent consideration	—		—		16.4		—		—		22.0
Total liabilities	$	—	$	6.6	$	16.4	$	—	$	3.8	$	22.0

Measured at fair value on a non-recurring basis:
Assets:
Goodwill⁽¹⁾	$	—	$	—	$	42.2	$	—	$	—	$	—
Indefinite-lived intangible assets⁽²⁾	—		—		10.5		—		—		—
Definite-lived intangible assets⁽³⁾	—		—		22.4		—		—		11.5
Total assets	$	—	$	—	$	75.1	$	—	$	—	$	11.5


(1)	As of September 29, 2018, goodwill with a carrying amount of $178.9 million was written down to a fair value of $42.2 million.


(2)	As of September 29, 2018, indefinite-lived intangible assets with a carrying amount of $46.7 million were written down to a fair value of $10.5 million.


(3)	As of September 29, 2018, definite-lived intangible assets with a carrying amount of $71.3 million were written down to a fair value of $22.4 million. As of December 31, 2017, definite-lived intangible assets with a carrying amount of $31.2 million were written down to a fair value of $11.5 million.

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation

The table below presents a reconciliation for the Royalty Pharma contingent milestone payments measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (in millions). Change in fair value in the table was recorded in Change in financial assets on the Condensed Consolidated Statements of Operations.



	Three Months Ended					Nine Months Ended
	September 29, 2018		September 30, 2017			September 29, 2018		September 30, 2017
Royalty Pharma Contingent Milestone Payments
Beginning balance	$	125.5	$	145.8		$	134.5	$	—
Additions	—		—			—		184.5
Foreign currency effect	—		0.3			—		0.8
Change in fair value	74.9		(2.9		)	65.9		(42.1		)
Ending balance	$	200.4	$	143.2		$	200.4	$	143.2

Reconciliation of Level 3 Liabilities

The table below presents a reconciliation for liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (in millions). Net realized losses in the table were recorded in Other operating expense (income) on the Condensed Consolidated Statements of Operations.



	Three Months Ended						Nine Months Ended
	September 29, 2018			September 30, 2017			September 29, 2018			September 30, 2017
Contingent Consideration
Beginning balance	$	16.2		$	49.7		$	22.0		$	69.9
Net realized (gains) losses	1.1			(2.9		)	(0.3		)	(18.5		)
Currency translation adjustments	(0.3		)	0.2			(0.3		)	1.5
Settlements	(0.6		)	(2.1		)	(5.0		)	(8.0		)
Ending balance	$	16.4		$	44.9		$	16.4		$	44.9

Schedule of Carrying Values and Estimated Fair Values of Debt Instruments

Our fixed rate long-term debt consisted of the following (in millions):



	September 29, 2018				December 31, 2017
	Level 1		Level 2		Level 1		Level 2
Public Bonds
Carrying Value (excluding discount)	$	2,600.0			$	2,600.0
Fair value	$	2,513.9			$	2,650.8

Retail bond and private placement note
Carrying value (excluding premium)			$	296.1			$	306.0
Fair value			$	321.1			$	342.1