10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

_______________________________________________

 FORM 10-Q

_______________________________________________

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: July 3, 2021

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from              to             

Commission file number 001-36353

_______________________________________________

Perrigo Company plc

(Exact name of registrant as specified in its charter)

_______________________________________________

Ireland	Not Applicable
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

The Sharp Building, Hogan Place, Dublin 2, Ireland D02 TY74

+353 1 7094000

(Address, including zip code, and telephone number, including

area code, of registrant’s principal executive offices)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Ordinary shares	PRGO	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒   No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and "emerging growth company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐	Non-accelerated filer	☐	Smaller reporting company	☐
Emerging growth company	☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.							☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

 ☐  Yes  ☒ No

As of August 6, 2021, there were 133,714,781 ordinary shares outstanding.

PERRIGO COMPANY PLC

FORM 10-Q

INDEX

		PAGE NUMBER
Cautionary Note Regarding Forward-Looking Statements		1
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Statements of Operations		2
Condensed Consolidated Statements of Comprehensive Income		3
Condensed Consolidated Balance Sheets		4
Condensed Consolidated Statements of Shareholders' Equity		5
Condensed Consolidated Statements of Cash Flows		6
Notes to the Condensed Consolidated Financial Statements
1	Summary of Significant Accounting Policies	7
2	Revenue Recognition	8
3	Acquisitions and Divestitures	10
4	Goodwill and Intangible Assets	13
5	Inventories	14
6	Fair Value Measurements	14
7	Investments	16
8	Discontinued Operations	16
9	Assets Held for Sale	19
10	Derivative Instruments and Hedging Activities	20
11	Leases	25
12	Indebtedness	27
13	Earnings per Share and Shareholders' Equity	29
14	Accumulated Other Comprehensive Income (Loss)	29
15	Income Taxes	30
16	Contingencies	34
17	Restructuring Charges	48
18	Segment Information	49
19	Subsequent Events	49
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		49
Item 3. Quantitative and Qualitative Disclosures About Market Risk		68
Item 4. Controls and Procedures		68
PART II. OTHER INFORMATION
Item 1. Legal Proceedings		69
Item 1A. Risk Factors		69
Item 5. Other Information		69
Item 6. Exhibits		70
Signatures		71

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements in this report are “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor created thereby. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our, or our industry’s actual results, levels of activity, performance or achievements to be materially different from those expressed or implied by any forward-looking statements. In particular, statements about our expectations, beliefs, plans, objectives, assumptions, future events or future performance contained in this report, including certain statements contained in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as “may,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” "forecast," “predict,” “potential” or the negative of those terms or other comparable terminology.

We have based these forward-looking statements on our current expectations, assumptions, estimates and projections. While we believe these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control, including: the effect of the novel coronavirus (COVID-19) pandemic and the associated economic downturn and supply chain impacts on the Company's business; the timing, amount and cost of any share repurchases; future impairment charges; customer acceptance of new products; competition from other industry participants, some of whom have greater marketing resources or larger market shares in certain product categories than we do; downward pricing pressures from customers and consumers, and upward pricing pressures from suppliers and service providers; resolution of uncertain tax positions, including the Company's appeal of the Notice of Assessment ("NoA") issued by the Irish Office of the Revenue Commissioners (“Irish Revenue”) and the Notices of Proposed Adjustment ("NOPAs") issued by the U.S. Internal Revenue Service and the impact that an adverse result in any such proceeding could have on operating results, cash flows and liquidity; potential third-party claims and litigation, including litigation relating to alleged price-fixing in the generic pharmaceutical industry, alleged class action and individual securities law claims, and alleged product liability claims and litigation relating to uncertain tax positions, including the NoA and NOPAs; developments relating to ongoing or future settlement discussions relating to any such claims or litigation; potential impacts of ongoing or future government investigations and regulatory initiatives; potential costs and reputational impact of product recalls and sales halts; the impact of tax reform legislation and healthcare policy; general economic conditions; fluctuations in currency exchange rates and interest rates; the success of the RX business sale, including the ability to achieve the expected benefits thereof, the risks that potential costs or liabilities incurred or retained in connection with the transaction may exceed the Company's estimates or adversely affect the Company's business or operations; the consummation and success of other announced acquisitions or dispositions, and the Company's ability to realize the desired benefits thereof; the Company’s ability to remain in compliance with its debt covenants, and our ability to execute and achieve the desired benefits of announced cost-reduction efforts, and strategic and other initiatives. An adverse result with respect to our appeal of any material outstanding tax assessments or litigation, could ultimately require the use of corporate assets to pay such assessments, damages from third-party claims, and related interest and/or penalties, and any such use of corporate assets would limit the assets available for other corporate purposes. Moreover, current volatility levels in our business and consumer behavior, in part related to the COVID-19 pandemic, can make planning difficult and projections uncertain, and such difficulty and uncertainty could increase if volatility worsens. These and other important factors, including those discussed in our Form 10-K for the year ended December 31, 2020, this report under “Risk Factors” and in any subsequent filings with the United States Securities and Exchange Commission, may cause actual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. The forward-looking statements in this report are made only as of the date hereof, and unless otherwise required by applicable securities laws, we disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

TRADEMARKS, TRADE NAMES AND SERVICE MARKS

This report contains trademarks, trade names and service marks that are the property of Perrigo Company plc, as well as, for informational purposes, trademarks, trade names, and service marks that are the property of other organizations. Solely for convenience, certain trademarks, trade names, and service marks referred to in this report appear without the ®, ™ and SM symbols, but those references are not intended to indicate that we or the applicable owner, as the case may be, will not assert, to the fullest extent under applicable law, our or their rights to such trademarks, trade names, and service marks.

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Perrigo Company plc - Item 1

PART I.     FINANCIAL INFORMATION

ITEM 1.        FINANCIAL STATEMENTS (UNAUDITED)

PERRIGO COMPANY PLC

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in millions, except per share amounts)

(unaudited)

 

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Net sales	$	981.1	$	948.8	$	1,991.1	$	2,032.0
Cost of sales	632.1		601.6		1,273.7		1,291.1
Gross profit	349.0		347.2		717.4		740.9
Operating expenses
Distribution	24.1		19.8		45.8		40.0
Research and development	33.0		30.4		64.1		58.3
Selling	139.8		119.3		275.2		258.9
Administration	110.4		114.3		237.6		233.9
Impairment charges	158.6		—		158.6		—
Restructuring	9.0		0.7		10.7		0.7
Total operating expenses	474.9		284.5		792.0		591.8
Operating income (loss)	(125.9)		62.7		(74.6)		149.1
Change in financial assets	—		(2.1)		—		(3.7)
Interest expense, net	31.6		32.2		63.6		61.1
Other (income) expense, net	(0.4)		17.1		1.9		18.8
Income (loss) from continuing operations before income taxes	(157.1)		15.5		(140.1)		72.9
Income tax expense (benefit)	(45.2)		3.1		(31.0)		2.8
Income (loss) from continuing operations	(111.9)		12.4		(109.1)		70.1
Income from discontinued operations, net of tax	54.2		48.2		89.5		96.9
Net income (loss)	$	(57.7)	$	60.6	$	(19.6)	$	167.0
Earnings (loss) per share
Basic
Continuing operations	$	(0.84)	$	0.09	$	(0.82)	$	0.52
Discontinued operations	0.41		0.35		0.67		0.71
Basic earnings per share	$	(0.43)	$	0.44	$	(0.15)	$	1.23
Diluted
Continuing operations	$	(0.84)	$	0.09	$	(0.82)	$	0.51
Discontinued operations	0.41		0.35		0.67		0.71
Diluted earnings per share	$	(0.43)	$	0.44	$	(0.15)	$	1.22
Weighted-average shares outstanding
Basic	133.6		136.4		133.4		136.3
Diluted	133.6		137.5		133.4		137.3

See accompanying Notes to the Condensed Consolidated Financial Statements.

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PERRIGO COMPANY PLC

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in millions)

(unaudited)

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Net income (loss)	$	(57.7)	$	60.6	$	(19.6)	$	167.0
Other comprehensive income (loss):
Foreign currency translation adjustments	32.5		86.7		(79.1)		(5.5)
Change in fair value of derivative financial instruments, net of tax	(1.3)		(0.7)		(7.3)		(10.1)
Change in post-retirement and pension liability, net of tax	(0.8)		(1.2)		(1.5)		(3.1)
Other comprehensive income (loss), net of tax	30.4		84.8		(87.9)		(18.7)
Comprehensive income (loss)	$	(27.3)	$	145.4	$	(107.5)	$	148.3

See accompanying Notes to the Condensed Consolidated Financial Statements.

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PERRIGO COMPANY PLC

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions, except per share amounts)

(unaudited)

	July 3, 2021		December 31, 2020
Assets
Cash and cash equivalents	$	317.5	$	631.5
Accounts receivable, net of allowance for credit losses of $7.7 and $6.5, respectively	620.2		593.5
Inventories	1,115.9		1,059.4
Prepaid expenses and other current assets	277.3		182.2
Current assets held for sale	2,089.3		666.9
Total current assets	4,420.2		3,133.5
Property, plant and equipment, net	833.8		864.6
Operating lease assets	171.3		154.7
Goodwill and indefinite-lived intangible assets	3,063.1		3,102.7
Definite-lived intangible assets, net	2,313.8		2,481.5
Deferred income taxes	49.0		40.6
Non-current assets held for sale	—		1,364.0
Other non-current assets	379.1		346.8
Total non-current assets	6,810.1		8,354.9
Total assets	$	11,230.3	$	11,488.4
Liabilities and Shareholders’ Equity
Accounts payable	$	402.4	$	451.6
Payroll and related taxes	106.2		152.9
Accrued customer programs	132.6		128.5
Other accrued liabilities	235.5		183.1
Accrued income taxes	9.4		9.0
Current indebtedness	630.1		37.3
Current liabilities held for sale	468.3		419.6
Total current liabilities	1,984.5		1,382.0
Long-term debt, less current portion	2,925.8		3,527.6
Deferred income taxes	254.9		276.2
Non-current liabilities held for sale	—		108.3
Other non-current liabilities	554.0		539.2
Total non-current liabilities	3,734.7		4,451.3
Total liabilities	5,719.2		5,833.3
Commitments and contingencies - Refer to Note 16
Shareholders’ equity
Controlling interests:
Preferred shares, $0.0001 par value per share, 10 shares authorized	—		—
Ordinary shares, €0.001 par value per share, 10,000 shares authorized	7,081.7		7,118.2
Accumulated other comprehensive income	307.1		395.0
Retained earnings (accumulated deficit)	(1,877.7)		(1,858.1)
Total shareholders’ equity	5,511.1		5,655.1
Total liabilities and shareholders' equity	$	11,230.3	$	11,488.4
Supplemental Disclosures of Balance Sheet Information
Preferred shares, issued and outstanding	—		—
Ordinary shares, issued and outstanding	133.6		133.1

See accompanying Notes to the Condensed Consolidated Financial Statements.

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PERRIGO COMPANY PLC

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(in millions, except per share amounts)

(unaudited)

	Ordinary Shares Issued			Accumulated Other Comprehensive Income		Retained Earnings (Accumulated Deficit)		Total
	Shares	Amount
Balance at December 31, 2019	136.1	$	7,359.9	$	139.4	$	(1,695.5)	$	5,803.8
Net income	—	—		—		106.4		106.4
Other comprehensive loss	—	—		(103.5)		—		(103.5)
Restricted stock plan	0.3	—		—		—		—
Compensation for stock options	—	0.8		—		—		0.8
Compensation for restricted stock	—	15.4		—		—		15.4
Cash dividends, $0.23 per share	—	(30.9)		—		—		(30.9)
Shares withheld for payment of employees' withholding tax liability	(0.1)	(5.6)		—		—		(5.6)
Balance at March 28, 2020	136.3	$	7,339.6	$	35.9	$	(1,589.1)	$	5,786.4
Net income	—	—		—		60.6		60.6
Other comprehensive income	—	—		84.8		—		84.8
Restricted stock plan	0.3	—		—		—		—
Compensation for stock options	—	0.4		—		—		0.4
Compensation for restricted stock	—	13.1		—		—		13.1
Cash dividends, $0.23 per share	—	(31.0)		—		—		(31.0)
Shares withheld for payment of employees' withholding tax liability	(0.1)	(3.9)		—		—		(3.9)
Balance at June 27, 2020	136.5	$	7,318.2	$	120.7	$	(1,528.5)	$	5,910.4

	Ordinary Shares Issued			Accumulated Other Comprehensive Income		Retained Earnings (Accumulated Deficit)		Total
	Shares	Amount
Balance at December 31, 2020	133.1	$	7,118.2	$	395.0	$	(1,858.1)	$	5,655.1
Net income	—	—		—		38.1		38.1
Other comprehensive loss	—	—		(118.3)		—		(118.3)
Restricted stock plan	0.6	—		—		—		—
Compensation for stock options	—	0.4		—		—		0.4
Compensation for restricted stock	—	24.6		—		—		24.6
Cash dividends, $0.24 per share	—	(32.6)		—		—		(32.6)
Shares withheld for payment of employees' withholding tax liability	(0.2)	(9.3)		—		—		(9.3)
Balance at April 3, 2021	133.5	$	7,101.3	$	276.7	$	(1,820.0)	$	5,558.0
Net loss	—	—		—		(57.7)		(57.7)
Other comprehensive income	—	—		30.4		—		30.4
Restricted stock plan	0.1	—		—		—		—
Compensation for stock options	—	0.2		—		—		0.2
Compensation for restricted stock	—	13.9		—		—		13.9
Cash dividends, $0.24 per share	—	(32.5)		—		—		(32.5)
Shares withheld for payment of employees' withholding tax liability	—	(1.2)		—		—		(1.2)
Balance at July 3, 2021	133.6	$	7,081.7	$	307.1	$	(1,877.7)	$	5,511.1

See accompanying Notes to the Condensed Consolidated Financial Statements.

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PERRIGO COMPANY PLC

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

(unaudited)

	Six Months Ended
	July 3, 2021		June 27, 2020
Cash Flows From (For) Operating Activities
Net income (loss)	$	(19.6)	$	167.0
Adjustments to derive cash flows:
Depreciation and amortization	165.3		187.8
Loss (Gain) on sale of business	—		17.4
Share-based compensation	39.1		29.7
Impairment charges	158.6		—
Change in financial assets	—		(3.7)
Restructuring charges	10.7		1.1
Deferred income taxes	(25.4)		11.7
Amortization of debt premium	(1.4)		(1.3)
Other non-cash adjustments, net	18.8		(11.5)
Subtotal	346.1		398.2
Increase (decrease) in cash due to:
Accounts receivable	(108.2)		227.9
Inventories	(106.0)		(38.6)
Prepaid expenses	1.8		(32.4)
Accounts payable	(22.5)		(21.6)
Payroll and related taxes	(61.1)		(20.4)
Accrued customer programs	4.3		(31.9)
Accrued liabilities	(32.1)		(7.9)
Accrued income taxes	(135.6)		(12.8)
Other, net	31.2		2.2
Subtotal	(428.2)		64.5
Net cash from (for) operating activities	(82.1)		462.7
Cash Flows From (For) Investing Activities
Proceeds from royalty rights	1.9		2.4
Purchase of equity method investment	—		(15.0)
Acquisitions of businesses, net of cash acquired	—		(106.0)
Asset acquisitions	(70.6)		(32.8)
Additions to property, plant and equipment	(68.4)		(60.1)
Net proceeds from sale of business	—		187.8
Other investing, net	1.3		2.0
Net cash from (for) investing activities	(135.8)		(21.7)
Cash Flows From (For) Financing Activities
Issuances of long-term debt	—		743.8
Borrowings (repayments) of revolving credit agreements and other financing, net	(5.8)		1.6
Deferred financing fees	—		(5.0)
Cash dividends	(65.1)		(61.9)
Other financing, net	(13.5)		(11.7)
Net cash from (for) financing activities	(84.4)		666.8
Effect of exchange rate changes on cash and cash equivalents	(3.2)		(5.8)
Net increase (decrease) in cash and cash equivalents	(305.5)		1,102.0
Cash and cash equivalents of continuing operations, beginning of period	631.5		344.5
Cash and cash equivalents held for sale, beginning of period	10.0		9.8
Less cash and cash equivalents held for sale, end of period	(18.5)		(18.7)
Cash and cash equivalents of continuing operations, end of period	$	317.5	$	1,437.6

See accompanying Notes to the Condensed Consolidated Financial Statements.

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Note 1

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

General Information

The Company

Perrigo Company plc was incorporated under the laws of Ireland on June 28, 2013 and became the successor registrant of Perrigo Company, a Michigan corporation, on December 18, 2013 in connection with the acquisition of Elan Corporation, plc ("Elan"). Unless the context requires otherwise, the terms "Perrigo," the "Company," "we," "our," "us," and similar pronouns used herein refer to Perrigo Company plc, its subsidiaries, and all predecessors of Perrigo Company plc and its subsidiaries.

Our vision is to make lives better by bringing Quality, Affordable Self-Care Products that consumers trust everywhere they are sold. We are a leading provider of over-the-counter ("OTC") health and wellness solutions that enhance individual well-being by empowering consumers to proactively prevent or treat conditions that can be self-managed.

Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") for interim financial information and with the instructions to Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and footnotes included in our Annual Report on Form 10-K for the year ended December 31, 2020. In the opinion of management, all adjustments (consisting of normal recurring accruals and other adjustments) considered necessary for a fair presentation of the unaudited Condensed Consolidated Financial Statements have been included and include our accounts and the accounts of all majority-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.

On March 1, 2021, we announced a definitive agreement to sell our generic RX Pharmaceuticals business ("RX business") to Altaris Capital Partners, LLC ("Altaris"). On July 6, 2021, we completed the sale of the RX business. The financial results of our RX business, which were previously reported in our Prescription Pharmaceuticals ("RX") segment, have been classified as discontinued operations in the Condensed Consolidated Statements of Operations for all periods presented. The assets and liabilities of our RX business are reflected as assets and liabilities held for sale in the Condensed Consolidated Balance Sheets for all periods presented. Refer to Note 8 for additional information regarding discontinued operations. Unless otherwise noted, amounts and disclosures throughout the Notes to the unaudited Condensed Consolidated Financial Statements relate to our continuing operations.

Segment Reporting

Our reporting and operating segments are as follows:

•Consumer Self-Care Americas ("CSCA") comprises our consumer self-care business (OTC, infant formula, and oral self-care categories, and contract manufacturing) in the U.S., Mexico and Canada.

•Consumer Self-Care International ("CSCI") comprises our consumer self-care business primarily branded in Europe and Australia, our store brand business in the United Kingdom and parts of Europe and Asia, and our liquid licensed products business in the United Kingdom until it was disposed on June 19, 2020.

Allowance for Credit Losses

Expected credit losses on trade receivables and contract assets are measured collectively by geographic location. The estimate of expected credit losses considers historical credit loss information that is adjusted for current conditions and for reasonable and supportable forecasts. Historical credit loss experience provides the primary basis for estimation of expected credit losses. Adjustments to historical loss information may be made for

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Note 1

significant changes in a geographic location’s economic conditions. Receivables that do not share risk characteristics are evaluated on an individual basis. These receivables are not included in the collective evaluation.

The allowance for credit losses is a valuation account that is deducted from the instruments’ cost basis to present the net amount expected to be collected. Trade receivables and contract assets are charged off against the allowance when the balance is no longer deemed collectible.

The following table presents the allowance for credit losses activity (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Beginning balance	$	9.1	$	6.2	$	6.5	$	6.0
Provision for credit losses, net	0.4		0.1		3.7		0.7
Receivables written-off	(0.6)		(0.9)		(0.9)		(1.1)
Recoveries collected	—		—		—		—
Transfer to held for sale	(1.4)		—		(1.4)		—
Currency translation adjustment	0.2		0.1		(0.2)		(0.1)
Ending balance	$	7.7	$	5.5	$	7.7	$	5.5

NOTE 2 – REVENUE RECOGNITION

Revenue is recognized when or as a customer obtains control of promised products. The amount of revenue recognized reflects the consideration we expect to be entitled to receive in exchange for these products.

Disaggregation of Revenue

We generated net sales in the following geographic locations(1) (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
U.S.	$	590.3	$	604.0	$	1,201.6	$	1,274.6
Europe(2)	348.1		311.8		704.1		684.4
All other countries(3)	42.7		33.0		85.4		73.0
Total net sales	$	981.1	$	948.8	$	1,991.1	$	2,032.0

(1) Derived from the location of the entity that sells to a third party.

(2) Includes Ireland net sales of $5.3 million and $9.8 million for the three and six months ended July 3, 2021 respectively, and $7.8 million and $11.5 million for the three and six months ended June 27, 2020, respectively.

(3) Includes net sales generated primarily in Mexico, Australia and Canada.

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Note 2

Product Category

The following is a summary of our net sales by category (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
CSCA(1)
Upper respiratory	$	102.4	$	116.7	$	216.4	$	271.3
Digestive health	110.4		112.1		223.9		219.0
Nutrition	95.6		88.6		187.6		190.8
Pain and sleep-aids	87.1		97.7		179.5		218.1
Oral self-care	74.5		63.2		148.2		118.5
Healthy lifestyle	63.6		81.5		139.1		167.3
Skincare and personal hygiene	52.9		42.9		106.2		89.6
Vitamins, minerals, and supplements	8.4		6.4		16.2		12.8
Other CSCA(2)	27.4		18.6		45.7		40.8
Total CSCA	622.3		627.7		1,262.8		1,328.2
CSCI
Skincare and personal hygiene	112.4		97.6		219.4		192.3
Vitamins, minerals, and supplements	49.1		38.5		108.1		87.0
Healthy lifestyle	48.0		40.5		98.3		84.1
Pain and sleep-aids	47.3		40.2		96.3		87.0
Upper respiratory	42.6		45.5		85.5		129.6
Oral self-care	22.5		20.4		48.0		43.6
Digestive health	9.7		5.1		18.2		11.1
Other CSCI(3)	27.2		33.3		54.5		69.1
Total CSCI	358.8		321.1		728.3		703.8
Total net sales	$	981.1	$	948.8	$	1,991.1	$	2,032.0

(1) Includes net sales from our OTC contract manufacturing business.

(2) Consists primarily of diagnostic and other miscellaneous or otherwise uncategorized product lines and markets, none of which is greater than 10% of the segment net sales.

(3) Consists primarily of our distribution business and other miscellaneous or otherwise uncategorized product lines and markets, none of which is greater than 10% of the segment net sales.

While the majority of revenue is recognized at a point in time, certain of our product revenue is recognized on an over time basis. Predominately, over time customer contracts exist in contract manufacturing arrangements, which occur in both the CSCA and CSCI segments. Contract manufacturing revenue was $69.8 million and $132.9 million for the three and six months ended July 3, 2021, respectively and $64.5 million and $113.7 million for the three and six months ended June 27, 2020, respectively.

We also recognize a portion of the store brand OTC product revenues in the CSCA segment on an over time basis; however, the timing difference between over time and point in time revenue recognition for store brand contracts is not significant due to the short time period between the customization of the product and shipment or delivery.

Contract Balances

The following table provides information about contract assets from contracts with customers (in millions):

	Balance Sheet Location	July 3, 2021		December 31, 2020
Short-term contract assets	Prepaid expenses and other current assets	$	22.4	$	19.7

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Note 3

NOTE 3 – ACQUISITIONS AND DIVESTITURES

Acquisitions Accounted for as a Business Combination During the Year Ended December 31, 2020

Eastern European OTC Dermatological Brands Acquisition

On October 30, 2020, we acquired three Eastern European OTC dermatological brands ("Eastern European Brands"), skincare brands Emolium® and Iwostin® and hair loss treatment brand Loxon®, from Sanofi. The transaction closed for €53.3 million ($62.3 million). We capitalized $52.5 million as brand-named intangible assets and allocated the remainder of the purchase price to goodwill, inventory, customer relationships and deferred tax assets.

The addition of these market-leading OTC brands complements our already robust skincare portfolio and adds scale to our Eastern European business. The acquisition also serves as another step for Perrigo’s CSCI growth plans and provides new opportunities for self-care revenue synergy in the European markets. The operating results of the brands are reported within our CSCI segment. The acquisition of the Eastern European Brands was accounted for as a business combination and has been reported in our Consolidated Statements of Operations as of the acquisition date.

The goodwill arising from the acquisition consists largely of the assembled workforce, and the cost and revenue synergies expected from integrating the business into the CSCI segment. The goodwill was allocated to our CSCI segment, none of which is deductible for income tax purposes. The definite-lived intangible assets acquired consisted of brands and customer relationships which are being amortized over a weighted average useful life of approximately 18.8 years. Both the brands and customer relationships were valued using the multi-period excess earnings method. Significant judgment was applied in estimating the fair value of the intangible assets acquired, which involved the use of significant estimates and assumptions with respect to the timing and amounts of cash flow projections, including revenue growth rates, projected profit margins, and discount rates. The opening balance sheet is final.

Oral Care Assets of High Ridge Brands

On April 1, 2020, we acquired the oral care assets of High Ridge Brands ("Dr. Fresh") for total purchase consideration of $113.0 million, subject to customary adjustments, including a working capital settlement. After such adjustments as of December 31, 2020, total cash consideration paid was $106.2 million net of $2.0 million that we allocated as prepayment of contract consideration for transitional services to be received related to the transaction.

This acquisition includes the children’s oral care value brand, Firefly®, in addition to the REACH® and Dr. Fresh® brands, and a licensing portfolio. The U.S. operations, which represent a significant portion of the business, are reported in our CSCA segment and the non-U.S. operations are reported in our CSCI segment.

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Note 3

The following table summarizes the consideration paid for Dr. Fresh and the amounts of the assets acquired and liabilities assumed (in millions):

	Oral Care Assets of High Ridge Brands (Dr. Fresh)
Purchase price paid	$	106.2
Assets acquired:
Accounts receivable	13.1
Inventories	22.2
Prepaid expenses and other current assets	0.4
Property, plant and equipment, net	0.7
Operating lease assets	2.6
Goodwill	17.2
Distribution and license agreements and supply agreements	$	2.2
Developed product technology, formulations, and product rights	0.1
Customer relationships and distribution networks	20.6
Trademarks, trade names, and brands	43.2
Total intangible assets	$	66.1
Total assets	$	122.3
Liabilities assumed:
Accounts payable	$	6.1
Other accrued liabilities	3.8
Payroll and related taxes	0.7
Accrued customer programs	3.0
Other non-current liabilities	2.5
Total liabilities	$	16.1
Net assets acquired	$	106.2

The goodwill of $17.2 million arising from the acquisition consists largely of the anticipated growth from new product sales, sales to new customers, the assembled workforce, and the synergies expected from combining the operations of Dr. Fresh into Perrigo. The goodwill is attributable to our CSCA segment and is tax deductible for income tax purposes. The definite-lived intangible assets acquired consisted of trademarks and trade names, license agreements, and customer relationships, which are being amortized over a weighted average useful life of approximately 17.8 years. Customer relationships were valued using the multi-period excess earnings method. Trademarks and trade names and developed technology were valued using the relief from royalty method. Significant judgment was applied in estimating the fair value of the intangible assets acquired, which involved the use of significant estimates and assumptions with respect to the timing and amounts of cash flow projections, including revenue growth rates, projected profit margins, and discount rates. The opening balance sheet is final.

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Note 3

Pro Forma Impact of Business Combinations

The following table presents unaudited pro forma information as if the acquisitions of Dr. Fresh and the Eastern European Brands occurred on January 1, 2019, and had been combined with the results reported in our Condensed Consolidated Statements of Operations for all periods presented (in millions):

	Three Months Ended		Six Months Ended
(Unaudited)	June 27, 2020		June 27, 2020
Net sales	$	955.0	$	2,074.1
Income from continuing operations	$	17.6	$	80.2

The unaudited pro forma information is presented for information purposes only and is not indicative of the results that would have been achieved if the acquisition had taken place at such time. The unaudited pro forma information presented above includes adjustments primarily for amortization charges for acquired intangible assets, depreciation of property, plant and equipment that have been revalued, certain acquisition-related charges, and related tax effects.

Acquisitions During the Six Months Ended June 27, 2020

Dexsil®

On February 13, 2020, we acquired Dexsil®, a silicon supplement brand, from RXW Group Nv, for total cash consideration paid of approximately $8.0 million. The transaction was accounted for as an asset acquisition, in which we capitalized the consideration paid as a brand-named intangible asset. We began amortizing the brand intangible over a 25-year useful life. Operating results attributable to the product are included within our CSCI segment.

Steripod®

On January 3, 2020, we acquired Steripod®, a leading toothbrush accessory brand and innovator in the toothbrush protector market, from Bonfit America Inc. Total consideration paid was $26.0 million. The transaction was accounted for as an asset acquisition, in which we capitalized $25.1 million as a brand-named intangible asset. The remainder of the purchase price was allocated to working capital. We began amortizing the brand intangible asset over a 25-year useful life. Operating results attributable to Steripod® are included within our CSCA segment.     

Divestitures During the Six Months Ended June 27, 2020

Rosemont Pharmaceuticals Business

On June 19, 2020, we completed the sale of our U.K.-based Rosemont Pharmaceuticals business, a generic prescription pharmaceuticals manufacturer focused on liquid medicines, to a U.K.-headquartered private equity firm for cash consideration of £155.6 million (approximately $195.0 million). The sale resulted in a pre-tax loss of $17.4 million during the three and six months ended June 27, 2020, $1.3 million during the three months ended September 26, 2020 and $2.4 million during the three months ended December 31, 2020. These losses were recorded in our CSCI segment in Other (income) expense, net on the Consolidated Statements of Operations. These losses included professional fees and a $46.4 million write-off of foreign currency translation adjustment from Accumulated other comprehensive income.

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Note 4

NOTE 4 – GOODWILL AND INTANGIBLE ASSETS

Goodwill

Changes in the carrying amount of goodwill, by reportable segment, were as follows (in millions):

	December 31, 2020		Purchase accounting adjustments		Impairments		Currency translation adjustments		July 3, 2021
CSCA(1)	$	1,905.0	$	2.4	$	(6.1)	$	(0.1)	$	1,901.2
CSCI(2)	1,190.7		(2.4)		—		(32.7)		1,155.6
Total goodwill	$	3,095.7	$	—	$	(6.1)	$	(32.8)	$	3,056.8

(1) We had no accumulated goodwill impairments as of December 31, 2020 and $6.1 million as of July 3, 2021.

(2) We had accumulated goodwill impairments of $868.4 million as of December 31, 2020 and July 3, 2021.

CSCA Reporting Unit Goodwill

On May 18, 2021, we announced a definitive agreement to sell our Mexico and Brazil-based OTC businesses ("Latin American businesses"), both within our CSCA segment, to Advent International. As a result, we prepared a goodwill impairment test. We determined the carrying value of this business exceeded the fair value and recorded an impairment of $6.1 million within our CSCA segment during the three months ended July 3, 2021 (refer to Note 6 and Note 9).

Intangible Assets

Intangible assets and related accumulated amortization consisted of the following (in millions):

	July 3, 2021				December 31, 2020
	Gross		Accumulated Amortization		Gross		Accumulated Amortization
Indefinite-lived intangibles:
Trademarks, trade names, and brands	$	3.6	$	—	$	4.3	$	—
In-process research and development	2.7		—		2.7		—
Total indefinite-lived intangibles	$	6.3	$	—	$	7.0	$	—
Definite-lived intangibles:
Distribution and license agreements and supply agreements	$	69.4	$	51.7	$	74.8	$	55.4
Developed product technology, formulations, and product rights	302.0		184.5		303.3		177.3
Customer relationships and distribution networks	1,877.9		863.7		1,920.5		823.7
Trademarks, trade names, and brands	1,534.0		369.6		1,581.5		342.2
Non-compete agreements	2.1		2.1		2.9		2.9
Total definite-lived intangibles	$	3,785.4	$	1,471.6	$	3,883.0	$	1,401.5
Total intangible assets	$	3,791.7	$	1,471.6	$	3,890.0	$	1,401.5

We recorded amortization expense of $53.4 million and $106.6 million for the three and six months ended July 3, 2021, respectively, and $51.6 million and $104.2 million for the three and six months ended June 27, 2020, respectively.

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Note 5

NOTE 5 – INVENTORIES

Major components of inventory were as follows (in millions):

 

	July 3, 2021		December 31, 2020
Finished goods	$	607.5	$	574.1
Work in process	241.0		220.4
Raw materials	267.4		264.9
Total inventories	$	1,115.9	$	1,059.4

NOTE 6 – FAIR VALUE MEASUREMENTS

The table below summarizes the valuation of our financial instruments carried at fair value by the applicable pricing categories (in millions):

	July 3, 2021						December 31, 2020
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Measured at fair value on a recurring basis:
Assets:
Investment securities	$	1.6	$	—	$	—	$	2.5	$	—	$	—
Foreign currency forward contracts	—		5.7		—		—		9.8		—
Cross-currency swap	—		4.2		—		—		6.3		—
Total assets	$	1.6	$	9.9	$	—	$	2.5	$	16.1	$	—
Liabilities:
Foreign currency forward contracts	$	—	$	2.7	$	—	$	—	$	7.9	$	—
Total liabilities	$	—	$	2.7	$	—	$	—	$	7.9	$	—
Measured at fair value on a non-recurring basis:
Assets:
Assets held for sale, net(1)	$	—	$	—	$	1,621.0	$	—	$	—	$	—
Total assets	$	—	$	—	$	1,621.0	$	—	$	—	$	—

(1)     We measured the assets held for sale for impairment purposes and recorded a total impairment of $158.6 million (refer to Note 9).

There were no transfers within Level 3 fair value measurements during the three and six months ended July 3, 2021 or the year ended December 31, 2020.

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Note 6

Royalty Pharma Contingent Milestone Receipts

During the year ended December 31, 2020, Royalty Pharma payments from Biogen for Tysabri® sales, as defined in the agreement between the parties, did not exceed the 2020 global net sales threshold. Therefore, we were not entitled to receive the remaining contingent milestone payment. As of December 31, 2020, there were no contingent milestone payments outstanding.

The table below summarizes the change in fair value of the Royalty Pharma contingent milestone (in millions):

	Three Months Ended		Six Months Ended
	June 27, 2020		June 27, 2020
Beginning balance	$	96.9	$	95.3
Change in fair value	2.1		3.7
Ending balance	$	99.0	$	99.0

We valued our contingent milestone payment from Royalty Pharma using a modified Black-Scholes Option Pricing Model ("BSOPM"). Key inputs in the BSOPM are the estimated volatility and rate of return of royalties on global net sales of Tysabri® that are received by Royalty Pharma until the contingent milestones are resolved. As of June 27, 2020, volatility and the estimated fair value of the milestones had a positive relationship such that higher volatility translates to a higher estimated fair value of the contingent milestone payments. Rate of return and the estimated fair value of the milestones had an inverse relationship, such that a lower rate of return correlates with a higher estimated fair value of the contingent milestone payments. We assessed volatility and rate of return inputs quarterly by analyzing certain market volatility benchmarks and the risk associated with Royalty Pharma achieving the underlying projected royalties. The table below represents the volatility and rate of return:

	Three Months Ended
	June 27, 2020
Volatility	37.5	%
Rate of return	6.91	%

During the three and six months ended June 27, 2020, the fair value of the Royalty Pharma contingent milestone payment related to 2020 increased by $2.1 million and $3.7 million,respectively, to $99.0 million, driven by higher volatility, higher projected global net sales of Tysabri® compared to the estimates in the prior period, and the estimated probability of achieving the earn-out. As of December 31, 2020, there were no contingent milestone payments outstanding and, accordingly, no asset recorded in the Condensed Consolidated Balance Sheet.

Non-recurring Fair Value Measurements

The non-recurring fair values represent only those assets whose carrying values were adjusted to fair value during the reporting period.

Goodwill

During the three months ended July 3, 2021, as a result of our definitive agreement to sell our Latin American businesses, we prepared a goodwill impairment test. We determined the carrying value of this business exceeded the fair value and recorded an impairment in the CSCA segment (refer to Note 4).

Assets held for sale, net

During the three months ended July 3, 2021, as a result of our definitive agreement to sell our Latin American businesses, we prepared an impairment test on the net assets held for sale related to this business. We determined the carrying value of the net assets held for sale exceed the fair value less cost to sell and recorded an impairment in the CSCA segment (refer to Note 9).

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Note 6

Fixed Rate Long-term Debt    

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

	July 3, 2021				December 31, 2020
	Level 1		Level 2		Level 1		Level 2
Public Bonds
Carrying Value (excluding discount)	$	2,760.0	$	—	$	2,760.0	$	—
Fair value	$	2,946.3	$	—	$	3,031.1	$	—
Private placement note
Carrying value (excluding premium)	$	—	$	160.2	$	—	$	164.9
Fair value	$	—	$	172.0	$	—	$	177.5

The fair values of our public bonds for all periods were based on quoted market prices. The fair values of our private placement note for all periods were based on interest rates offered for borrowings of a similar nature and remaining maturities.

The carrying amounts of our other financial instruments, consisting of cash and cash equivalents, accounts receivable, accounts payable, short-term debt, revolving credit agreements, promissory notes related to our equity method investment in Kazmira, and variable rate long-term debt, approximate their fair value.

NOTE 7 – INVESTMENTS

The following table summarizes the measurement category, balance sheet location, and balances of our equity securities (in millions):

Measurement Category	Balance Sheet Location	July 3, 2021		December 31, 2020
Fair value method	Prepaid expenses and other current assets	$	1.6	$	2.5
Fair value method(1)	Other non-current assets	$	1.7	$	1.9
Equity method	Other non-current assets	$	69.1	$	69.8

(1)     Measured at fair value using the Net Asset Value practical expedient.

The following table summarizes the expense (income) recognized in earnings of our equity securities (in millions):

		Three Months Ended				Six Months Ended
Measurement Category	Income Statement Location	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Fair value method	Other (income) expense, net	$	0.9	$	(0.4)	$	0.9	$	2.5
Equity method	Other (income) expense, net	$	—	$	(0.8)	$	0.7	$	(1.5)

NOTE 8 – DISCONTINUED OPERATIONS

Our discontinued operations primarily consist of our RX segment, which held our prescription pharmaceuticals business in the U.S. and our pharmaceuticals and diagnostic businesses in Israel (collectively, the “RX business”).

On March 1, 2021, we announced a definitive agreement to sell our RX business to Altaris. On July 6, 2021, we completed the sale of the RX business for aggregate consideration of $1.55 billion, subject to customary adjustments for cash, debt, working capital and certain transaction expenses. The consideration includes approximately $53.0 million of reimbursements which Altaris will be required to deliver in cash to Perrigo pursuant to the terms of the Agreement.

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Note 8

As of March 1, 2021, we determined that the RX business met the criteria to be classified as a discontinued operation and, as a result, its historical financial results have been reflected in our consolidated financial statements as a discontinued operation and its assets and liabilities have been classified as held for sale. We ceased recording depreciation and amortization on the RX business assets from March 1, 2021. We have not allocated any general corporate overhead to the discontinued operation.

Under the terms of the agreement, we will provide transition services for up to 24 months after the close of the transaction and also enter into a reciprocal supply agreement pursuant to which Perrigo will supply certain products to the RX business and the RX business will supply certain products to Perrigo. The supply agreements have a term of four years, extendable up to seven years by the party who is the purchaser of the products under such agreement. We will also extend distribution rights to the RX business for certain OTC products owned and manufactured by Perrigo that may be fulfilled through pharmacy channels, in return for a share of the net profits.

The agreement provides that Perrigo will retain certain pre-closing liabilities arising out of antitrust (refer to Note 16 - Contingencies under the header "Price-Fixing Lawsuits") and opioid matters and the Company’s Albuterol recall, subject to, in each case, the buyer's obligation to indemnify the Company for fifty percent of these liabilities up to an aggregate cap on the buyer's obligation of $50.0 million.

Income from discontinued operations, net of tax was as follows (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Net sales	$	204.5	$	270.4	$	404.5	$	528.1
Cost of sales	119.9		180.6		258.2		346.4
Gross profit	84.6		89.8		146.3		181.7
Operating expenses
Distribution	2.8		3.8		6.1		7.8
Research and development	17.3		16.4		30.6		30.1
Selling	8.8		7.4		16.2		14.7
Administration	12.4		8.1		30.6		14.5
Restructuring	—		0.4		—		0.4
Other operating expense (income)	0.5		(0.9)		(0.4)		0.2
Total operating expenses	41.8		35.2		83.1		67.7
Operating income (loss)	$	42.8	$	54.6	63.2		114.0
Interest expense, net	0.2		1.1		0.8		2.5
Other (income) expense, net	(0.2)		(2.9)		(1.7)		(2.1)
Income before income taxes	42.8		56.4		64.1		113.6
Income tax expense (benefit)	(11.4)		8.2		(25.4)		16.7
Income from discontinued operations, net of tax	$	54.2	$	48.2	$	89.5	$	96.9

During the three and six months ended July 3, 2021, we incurred $2.4 million and $11.7 million, respectively, of separation costs related to the sale of the RX business, which are recorded in administration expenses.

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Note 8

Select cash flow information related to discontinued operations was as follows (in millions):

	Six Months Ended
	July 3, 2021		June 27, 2020
Cash flows from discontinued operations operating activities:
Depreciation and amortization	$	15.3	$	48.2
Cash flows from discontinued operations investing activities:
Asset acquisitions	$	(69.7)	$	(0.1)
Additions to property, plant and equipment	$	(6.1)	$	(5.6)

Asset acquisitions related to discontinued operations consisted of two ANDAs purchased under a contractual arrangement entered into on May 15, 2015 with a third party that specializes in research and development and obtaining approval for various drug candidates to develop specific products. On December 31, 2020, we purchased an ANDA for a generic topical gel for $16.4 million, which was subsequently paid during the three months ended April 3, 2021 and on March 8, 2021, we purchased an ANDA for a generic topical lotion for $53.3 million. The generic topical lotion acquisition was assumed by Altaris in connection with the sale of the RX business.

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Note 8

The assets and liabilities classified as held for sale related to discontinued operations were as follows (in millions):

	July 3, 2021		December 31, 2020
Cash and cash equivalents	$	9.3	$	10.0
Accounts receivable, net of allowance for credit losses of $1.0 and $1.1, respectively	496.4		460.7
Inventories	143.4		140.8
Prepaid expenses and other current assets	21.4		55.4
Current assets held for sale*			666.9
Property, plant and equipment, net	133.3		131.4
Operating lease assets	30.0		31.3
Goodwill and indefinite-lived intangible assets	680.0		681.2
Definite-lived intangible assets, net	532.9		492.8
Deferred income taxes	4.2		3.6
Other non-current assets	22.6		23.7
Non-current assets held for sale*			1,364.0
Total assets held for sale	$	2,073.5	$	2,030.9
Accounts payable	$	91.6	$	92.2
Payroll and related taxes	14.1		22.3
Accrued customer programs	235.6		237.4
Other accrued liabilities	27.4		67.2
Accrued income taxes	0.1		—
Current indebtedness	0.5		0.5
Current liabilities held for sale*			419.6
Long-term debt, less current portion	0.4		0.7
Deferred income taxes	3.2		3.1
Other non-current liabilities	64.6		104.5
Non-current liabilities held for sale*			108.3
Total liabilities held for sale	$	437.5	$	527.9

*The non-current assets and liabilities of the RX business have been reclassified to current assets and liabilities held for sale, respectively, and the sale was completed on July 6, 2021.

NOTE 9 – ASSETS HELD FOR SALE

We classify assets as "held for sale" when, among other factors, management approves and commits to a formal plan of sale with the expectation the sale will be completed within one year. The net assets of the business held for sale are then recorded at the lower of their current carrying value and the fair market value, less costs to sell.

During the three months ended July 3, 2021, management committed to a plan to sell our Latin American businesses; as a result, such assets were classified as held for sale. The assets associated with this business were reported within our CSCA segment. The sale is expected to close in the second half of 2021. At July 3, 2021, we determined the carrying value of the net assets held for sale of this business exceeded their fair value less cost to sell, resulting in an impairment charge of $152.5 million. We also recorded a goodwill impairment charge of $6.1 million within our CSCA segment, related to the Latin American businesses (refer to Note 4), resulting in a total impairment charge of $158.6 million.

In addition to the assets and liabilities held for sale related to discontinued operations (refer to Note 8), the assets and liabilities held for sale related to the Latin American businesses were reported within Current assets held for sale and Current liabilities held for sale on the Condensed Consolidated Balance Sheets. Net of impairment

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Note 9

charges, the assets and liabilities of the Latin American businesses reported as held for sale as of July 3, 2021 totaled $15.8 million and $30.8 million, respectively.

NOTE 10 – DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES     

Cross Currency Swaps

On August 15, 2019, we entered into a cross-currency swap designated as a net investment hedge to hedge the EUR currency exposure of our net investment in European operations. This agreement is a contract to exchange floating-rate Euro payments for floating-rate U.S. dollar payments through August 15, 2022. The payments are based on a notional basis of €450.0 million ($498.0 million) and settle quarterly.

Interest Rate Swaps

There were no active designated or non-designated interest rate swaps as of July 3, 2021 or December 31, 2020.

Foreign Currency Forwards

Foreign currency forward contracts were as follows (in millions):

	Notional Amount
	July 3, 2021		December 31, 2020
European Euro (EUR)	$	209.3	$	312.6
British Pound (GBP)	104.4		92.3
Israeli Shekel (ILS)	71.6		94.4
Danish Krone (DKK)	44.7		65.2
Swedish Krona (SEK)	42.2		41.2
Chinese Yuan (CNY)	41.5		49.1
United States Dollar (USD)	26.3		101.5
Canadian Dollar (CAD)	23.3		36.8
Polish Zloty (PLZ)	22.2		21.8
Norwegian Krone (NOK)	10.5		7.8
Romanian New Leu (RON)	5.7		3.6
Switzerland Franc (CHF)	5.1		8.2
Australian Dollar (AUD)	5.0		11.3
Turkish Lira (TRY)	4.3		4.0
Mexican Peso (MPX)	1.0		15.6
Other	2.6		2.3
Total	$	619.7	$	867.7

The maximum term of our forward currency exchange contracts is 60 months.

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Perrigo Company plc - Item 1

Note 10

Effects of Derivatives on the Financial Statements

The below tables indicate the effects of all derivative instruments on the Condensed Consolidated Financial Statements. All amounts exclude income tax effects.

The balance sheet location and gross fair value of our outstanding derivative instruments were as follows (in millions):

		Asset Derivatives
		Fair Value
	Balance Sheet Location	July 3, 2021		December 31, 2020
Designated derivatives:
Foreign currency forward contracts	Prepaid expenses and other current assets	$	5.1	$	5.0
Foreign currency forward contracts	Other non-current assets	0.3		0.5
Cross-currency swap	Other non-current assets	4.2		6.3
Total designated derivatives		$	9.6	$	11.8
Non-designated derivatives:
Foreign currency forward contracts	Prepaid expenses and other current assets	$	0.3	$	4.3

		Liability Derivatives
		Fair Value
	Balance Sheet Location	July 3, 2021		December 31, 2020
Designated derivatives:
Foreign currency forward contracts	Other accrued liabilities	$	0.9	$	5.5
Non-designated derivatives:
Foreign currency forward contracts	Other accrued liabilities	$	1.8	$	2.4

The following tables summarize the effect of derivative instruments designated as hedging instruments in Accumulated Other Comprehensive Income ("AOCI") (in millions):

	Three Months Ended
	July 3, 2021
Instrument	Amount of Gain/(Loss) Recorded in OCI		Classification of Gain/(Loss) Reclassified from AOCI into Earnings	Amount of Gain/(Loss) Reclassified from AOCI into Earnings		Classification of Gain/(Loss) Recognized into Earnings Related to Amounts Excluded from Effectiveness Testing	Amount of Gain/(Loss) Recognized in Earnings on Derivatives Related to Amounts Excluded from Effectiveness Testing
Cash flow hedges:
Interest rate swap agreements	$	—	Interest expense, net	$	(0.4)	Interest expense, net	$	—
Foreign currency forward contracts	1.1		Net sales	(1.0)		Net sales	—
			Cost of sales	0.9		Cost of sales	0.4
						Other (income) expense, net	0.4
	$	1.1		$	(0.5)		$	0.8
Net investment hedges:
Cross-currency swap	$	(1.5)				Interest expense, net	$	(1.1)

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Note 10

	Six Months Ended
	July 3, 2021
Instrument	Amount of Gain/(Loss) Recorded in OCI(1)		Classification of Gain/(Loss) Reclassified from AOCI into Earnings	Amount of Gain/(Loss) Reclassified from AOCI into Earnings		Classification of Gain/(Loss) Recognized into Earnings Related to Amounts Excluded from Effectiveness Testing	Amount of Gain/(Loss) Recognized in Earnings on Derivatives Related to Amounts Excluded from Effectiveness Testing
Cash flow hedges:
Interest rate swap agreements	—		Interest expense, net	(0.9)		Interest expense, net	—
Foreign currency forward contracts	(1.2)		Net sales	(1.9)		Net sales	—
			Cost of sales	2.8		Cost of sales	0.5
						Other (income) expense, net	0.4
	$	(1.2)		$	—		$	0.9
Net investment hedges:
Cross-currency swap	$	(2.0)				Interest expense, net	$	(2.2)

(1) Net loss of $8.9 million is expected to be reclassified out of AOCI into earnings during the next 12 months.

	Three Months Ended
	June 27, 2020
Instrument	Amount of Gain/(Loss) Recorded in OCI		Classification of Gain/(Loss) Reclassified from AOCI into Earnings	Amount of Gain/(Loss) Reclassified from AOCI into Earnings		Classification of Gain/(Loss) Recognized into Earnings Related to Amounts Excluded from Effectiveness Testing	Amount of Gain/(Loss) Recognized in Earnings on Derivatives Related to Amounts Excluded from Effectiveness Testing
Cash flow hedges:
Interest rate swap agreements	$	—	Interest expense, net	$	(0.5)	Interest expense, net	$	—
Foreign currency forward contracts	0.5		Net sales	0.3		Net sales	—
			Cost of sales	0.1		Cost of sales	0.3
	$	0.5		$	(0.1)		$	0.3
Net investment hedges:
Cross-currency swap	$	(3.3)				Interest expense, net	$	1.8

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Note 10

	Six Months Ended
	June 27, 2020
Instrument	Amount of Gain/(Loss) Recorded in OCI		Classification of Gain/(Loss) Reclassified from AOCI into Earnings	Amount of Gain/(Loss) Reclassified from AOCI into Earnings		Classification of Gain/(Loss) Recognized into Earnings Related to Amounts Excluded from Effectiveness Testing	Amount of Gain/(Loss) Recognized in Earnings on Derivatives Related to Amounts Excluded from Effectiveness Testing
Cash flow hedges:
Interest rate swap agreements	$	—	Interest expense, net	$	(0.9)	Interest expense, net	$	—
Foreign currency forward contracts	9.8		Net sales	(0.1)		Net sales	—
			Cost of sales	(1.0)		Cost of sales	0.7
	$	9.8		$	(2.0)		$	0.7
Net investment hedges:
Cross-currency swap	$	(18.3)				Interest expense, net	$	4.6

The amounts of (income)/expense recognized in earnings related to our non-designated derivatives on the Condensed Consolidated Statements of Operations were as follows (in millions):

		Three Months Ended				Six Months Ended
Non-Designated Derivatives	Income Statement Location	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Foreign currency forward contracts	Other (income) expense, net	$	(3.1)	$	(7.0)	$	(5.9)	$	(0.2)
	Interest expense, net	0.4		1.1		0.9		1.4
		$	(2.7)	$	(5.9)	$	(5.0)	$	1.2

The classification and amount of gain/(loss) recognized in earnings on fair value and hedging relationships were as follows (in millions):

	Three Months Ended
	July 3, 2021
	Net Sales		Cost of Sales		Interest Expense, net		Other (Income) Expense, net
Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded	$	981.1	$	632.1	$	31.6	$	(0.4)
The effects of cash flow hedging:
Gain (loss) on cash flow hedging relationships
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	$	(1.0)	$	0.9	$	—	$	—
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	$	—	$	0.4	$	—	$	0.4
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	$	—	$	—	$	(0.4)	$	—

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Note 10

	Six Months Ended
	July 3, 2021
	Net Sales		Cost of Sales		Interest Expense, net		Other (Income) Expense, net
Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded	$	1,991.1	$	1,273.7	$	63.6	$	1.9
The effects of cash flow hedging:
Gain (loss) on cash flow hedging relationships
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	$	(1.9)	$	2.8	$	—	$	—
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	$	—	$	0.5	$	—	$	0.4
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	$	—	$	—	$	(0.9)	$	—

	Three Months Ended
	June 27, 2020
	Net Sales		Cost of Sales		Interest Expense, net		Other (Income) Expense, net
Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded	$	948.8	$	601.6	$	32.2	$	17.1
The effects of cash flow hedging:
Gain (loss) on cash flow hedging relationships
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	$	0.3	$	0.1	$	—	$	—
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	$	—	$	0.3	$	—	$	—
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	$	—	$	—	$	(0.5)	$	—

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Note 10

	Six Months Ended
	June 27, 2020
	Net Sales		Cost of Sales		Interest Expense, net		Other (Income) Expense, net
Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded	$	2,032.0	$	1,291.1	$	61.1	$	18.8
The effects of cash flow hedging:
Gain (loss) on cash flow hedging relationships
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	$	(0.1)	$	(1.0)	$	—	$	—
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	$	—	$	0.7	$	—	$	—
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	$	—	$	—	$	(0.9)	$	—

NOTE 11 – LEASES

The balance sheet locations of our lease assets and liabilities were as follows (in millions):

Assets	Balance Sheet Location	July 3, 2021		December 31, 2020
Operating	Operating lease assets	$	171.3	$	154.7
Finance	Other non-current assets	31.0		29.8
Total		$	202.3	$	184.5

Liabilities	Balance Sheet Location	July 3, 2021		December 31, 2020
Current
Operating	Other accrued liabilities	$	27.9	$	28.3
Finance	Current indebtedness	5.2		6.7
Non-Current
Operating	Other non-current liabilities	149.6		132.5
Finance	Long-term debt, less current portion	23.3		20.2
Total		$	206.0	$	187.7

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Note 11

The below table shows our lease assets and liabilities by reporting segment (in millions):

	Assets
	Operating				Financing
	July 3, 2021		December 31, 2020		July 3, 2021		December 31, 2020
CSCA	$	98.1	$	75.9	$	16.1	$	16.7
CSCI	32.3		34.4		8.6		5.9
Unallocated	40.9		44.4		6.3		7.2
Total	$	171.3	$	154.7	$	31.0	$	29.8

	Liabilities
	Operating				Financing
	July 3, 2021		December 31, 2020		July 3, 2021		December 31, 2020
CSCA	$	98.2	$	75.8	$	16.6	$	17.0
CSCI	33.7		35.2		5.4		2.5
Unallocated	45.6		49.8		6.5		7.4
Total	$	177.5	$	160.8	$	28.5	$	26.9

Lease expense was as follows (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Operating leases(1)	$	9.8	$	8.5	$	19.7	$	18.1
Finance leases
Amortization	$	1.5	$	1.0	$	3.0	$	2.0
Interest	0.2		0.2		0.4		0.4
Total finance leases	$	1.7	$	1.2	$	3.4	$	2.4

            (1) Includes short-term leases and variable lease costs, which are immaterial.

The annual future maturities of our leases as of July 3, 2021 are as follows (in millions):

	Operating Leases		Finance Leases		Total
2021	$	16.5	$	3.0	$	19.5
2022	28.0		5.5		33.5
2023	20.7		3.9		24.6
2024	17.6		2.4		20.0
2025	15.7		2.2		17.9
After 2025	106.9		15.9		122.8
Total lease payments	205.4		32.9		238.3
Less: Interest	27.9		4.4		32.3
Present value of lease liabilities	$	177.5	$	28.5	$	206.0

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Perrigo Company plc - Item 1

Note 11

Our weighted average lease terms and discount rates are as follows:

	July 3, 2021		June 27, 2020
Weighted-average remaining lease term (in years)
Operating leases	11.59		6.31
Finance leases	9.24		9.89
Weighted-average discount rate
Operating leases	2.71	%	3.73	%
Finance leases	2.76	%	3.39	%

Our lease cash flow classifications are as follows (in millions):

	Six Months Ended
	July 3, 2021		June 27, 2020
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows for operating leases	$	18.2	$	17.3
Operating cash flows for finance leases	$	0.4	$	0.4
Financing cash flows for finance leases	$	2.6	$	1.9
Leased assets obtained in exchange for new finance lease liabilities	$	4.4	$	2.2
Leased assets obtained in exchange for new operating lease liabilities	$	34.9	$	22.3

NOTE 12 – INDEBTEDNESS

Total borrowings outstanding are summarized as follows (in millions):

			July 3, 2021		December 31, 2020
Term loan
	2019 Term loan due August 15, 2022		$	600.0	$	600.0
Notes and Bonds
	Coupon	Due
	5.105%	July 28, 2023(1)	160.2		164.9
	4.000%	November 15, 2023	215.6		215.6
	3.900%	December 15, 2024	700.0		700.0
	4.375%	March 15, 2026	700.0		700.0
	3.150%	June 15, 2030	750.0		750.0
	5.300%	November 15, 2043	90.5		90.5
	4.900%	December 15, 2044	303.9		303.9
	Total notes and bonds		2,920.2		2,924.9
Other financing			53.4		57.4
Unamortized premium (discount), net			(2.1)		(0.3)
Deferred financing fees			(15.6)		(17.1)
Total borrowings outstanding			3,555.9		3,564.9
	Current indebtedness		(630.1)		(37.3)
Total long-term debt less current portion			$	2,925.8	$	3,527.6

    (1) Debt denominated in euros subject to fluctuations in the euro-to-U.S. dollar exchange rate.

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Note 12

Revolving Credit Agreements

On March 8, 2018, we entered into a $1.0 billion revolving credit agreement maturing on March 8, 2023 (the "2018 Revolver"). There were no borrowings outstanding under the 2018 Revolver as of July 3, 2021 or December 31, 2020.

Term Loan and Notes

In August 2019, we refinanced a prior term loan with the proceeds of a new $600.0 million term loan, maturing on August 15, 2022 (the "2019 Term Loan"). We had $600.0 million outstanding under our 2019 Term Loan as of both July 3, 2021 and December 31, 2020.

Waiver of Debt Covenants

We are subject to financial covenants in the 2018 Revolver and 2019 Term Loan, including a maximum leverage ratio covenant, which previously required us to maintain a ratio of Consolidated Net Indebtedness to Consolidated EBITDA (as such terms are defined in such credit agreements) of not more than 3.75 to 1.00 at the end of each fiscal quarter. As of July 3, 2021, we were not in compliance with such covenant. However, we have received a waiver of such covenant from the lenders under both such credit facilities and have entered into an amendment to each of the 2018 Revolver and 2019 Term Loan. Under such amendments, the maximum leverage ratio was increased to 5.75 to 1.00 for the third quarter of 2021, returning to 3.75 to 1.00 beginning with the fourth quarter of 2021. If we consummate certain qualifying acquisitions in the fourth quarter of 2021 or any subsequent quarter during the term of the loan, the maximum ratio would increase to 4.00 to 1.00 for such quarter. Neither the failure to meet the leverage covenant for the second quarter of 2021, nor the waiver and amendments described above, affect our ability to draw under the 2018 Revolver.

2020 Notes

On June 19, 2020, Perrigo Finance Unlimited Company, an indirect wholly-owned finance subsidiary of Perrigo ("Perrigo Finance"), issued $750.0 million in aggregate principal amount of 3.150% Senior Notes due 2030 (the “2020 Notes") and received net proceeds of $737.1 million after the underwriting discount and offering expenses. Interest on the 2020 Notes is payable semi-annually in arrears on June 15 and December 15 of each year, beginning on December 15, 2020. The 2020 Notes will mature on June 15, 2030 and are governed by a base indenture and a third supplemental indenture (collectively, the "2020 Indenture"). The 2020 Notes are fully and unconditionally guaranteed on a senior unsecured basis by Perrigo. Perrigo Finance may redeem the 2020 Notes in whole or in part at any time for cash at the make-whole redemption prices described in the 2020 Indenture. On July 6, 2020, a portion of the proceeds of the 2020 Notes were used to fund the redemption of $280.4 million of Perrigo Finance's 3.500% Senior Notes due March 15, 2021 and $309.6 million of 3.500% Senior Notes due December 15, 2021.

Other Financing

We have overdraft facilities available that we use to support our cash management operations. We report any balances outstanding in the above table under "Other financing". There were no borrowings outstanding under the facilities as of July 3, 2021 or December 31, 2020.

On June 17, 2020, we incurred debt of $34.3 million related to our equity method investment in Kazmira pursuant to two Promissory Notes, with $3.7 million, $5.8 million and $24.8 million to be settled in November 2020, May 2021 and November 2021, respectively. On December 8, 2020, we repaid the $3.7 million balance due on the November 2020 portion of the Promissory Notes. On June 7, 2021, we repaid the $5.8 million balance due on the May 2021 portion of the Promissory Notes.

We have financing leases that are reported in the above table under "Other financing" (refer to Note 11).

28

Perrigo Company plc - Item 1

Note 13

NOTE 13 – EARNINGS PER SHARE AND SHAREHOLDERS' EQUITY

Earnings per Share

A reconciliation of the numerators and denominators used in the basic and diluted earnings per share ("EPS") calculation is as follows (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Numerator:
Income (loss) from continuing operations	$	(111.9)	$	12.4	$	(109.1)	$	70.1
Income from discontinued operations, net of tax	54.2		48.2		89.5		96.9
Net income (loss)	$	(57.7)	$	60.6	$	(19.6)	$	167.0
Denominator:
Weighted average shares outstanding for basic EPS	133.6		136.4		133.4		136.3
Dilutive effect of share-based awards*	—		1.1		—		1.0
Weighted average shares outstanding for diluted EPS	133.6		137.5		133.4		137.3
Anti-dilutive share-based awards excluded from computation of diluted EPS	—		1.5		—		1.5
* In the period of a net loss, diluted shares equal basic shares.

Shareholders' Equity

Share Repurchases

In October 2018, our Board of Directors authorized up to $1.0 billion of share repurchases with no expiration date, subject to the Board of Directors’ approval of the pricing parameters and amount that may be repurchased under each specific share repurchase program (the "2018 Authorization"). We did not repurchase any shares during the three and six months ended July 3, 2021 and June 27, 2020.

NOTE 14 – ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Changes in our AOCI balances, net of tax were as follows (in millions):

	Fair Value of Derivative Financial Instruments, net of tax		Foreign Currency Translation Adjustments		Post-Retirement and Pension Liability Adjustments, net of tax		Total AOCI
Balance at December 31, 2020	$	(0.7)	$	407.3	$	(11.6)	$	395.0
OCI before reclassifications	(7.3)		(79.1)		(1.5)		(87.9)
Amounts reclassified from AOCI	—		—		—		—
Other comprehensive income (loss)	$	(7.3)	$	(79.1)	$	(1.5)	$	(87.9)
Balance at July 3, 2021	$	(8.0)	$	328.2	$	(13.1)	$	307.1

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Note 15

NOTE 15 – INCOME TAXES

The effective tax rates were as follows:

Three Months Ended				Six Months Ended
July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
28.8	%	19.7	%	22.1	%	3.9	%

The effective tax rate for the three and six months ended July 3, 2021 increased compared to the effective tax rate for the three and six months ended June 27, 2020, primarily due to tax benefits in the 2020 periods for reductions to the U.S. valuation allowance and the U.S. Coronavirus Aid, Relief and Economic Security ("CARES") Act, enacted in the first quarter of 2020, plus the net tax expense on 2021 intra-entity transfers of intellectual property.

In December 2019, the FASB issued ASU No. 2019-12, "Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes." It removes certain exceptions to the general principles in ASC Topic 740 and improves consistent application of and simplifies GAAP for other areas of ASC Topic 740 by clarifying and amending existing guidance. This guidance was effective for interim and annual reporting periods beginning after December 15, 2020. We adopted this guidance as of January 1, 2021, and the impact on our Consolidated Financial Statements was immaterial.

Internal Revenue Service Audits of Perrigo Company, a U.S. Subsidiary

Perrigo Company, our U.S. subsidiary ("Perrigo U.S."), is engaged in a series of tax disputes in the U.S. relating primarily to transfer pricing adjustments including income in connection with the purchase, distribution, and sale of store-brand OTC pharmaceutical products in the United States, including the heartburn medication omeprazole. On August 27, 2014, we received a statutory notice of deficiency from the IRS relating to our fiscal tax years ended June 27, 2009, and June 26, 2010 (the “2009 tax year” and “2010 tax year”, respectively). On April 20, 2017, we received a second statutory notice of deficiency from the IRS for the fiscal tax years ended June 25, 2011 and June 30, 2012 (the “2011 tax year” and “2012 tax year”, respectively). Specifically, both statutory notices proposed adjustments related to the offshore reporting of profits on sales of omeprazole in the United States resulting from the assignment of an omeprazole distribution contract to an affiliate. In addition to the transfer pricing adjustments, which applied to all four tax years, the statutory notice of deficiency for the 2011 and 2012 tax years included adjustments for the capitalization and amortization of certain expenses that were deducted when paid or incurred in defending against certain patent infringement lawsuits related to ANDAs.

We do not agree with the audit adjustments proposed by the IRS in either of the notices of deficiency. We paid the assessed amounts of tax, interest, and penalties set forth in the statutory notices and timely filed claims for refund on June 11, 2015 for the 2009 and 2010 tax years, and on June 7, 2017, for the 2011 and 2012 tax years. On August 15, 2017, following disallowance of such refund claims, we timely filed a complaint in the United States District Court for the Western District of Michigan seeking refunds of tax, interest, and penalties of $27.5 million for the 2009 tax year, $41.8 million for the 2010 tax year, $40.1 million for the 2011 tax year, and $24.7 million for the 2012 tax year, for a total of $134.1 million, plus statutory interest thereon from the dates of payment. The amounts sought in the complaint for the 2009 and 2010 tax years were recorded as deferred charges in Other non-current assets on our balance sheet during the three months ended March 28, 2015, and the amounts sought in the complaint for the 2011 and 2012 tax years were recorded as deferred charges in Other non-current assets on our balance sheet during the three months ended July 1, 2017.

The previously rescheduled trial was held during the period May 25, 2021 to June 7, 2021 for the refund case in the United States District Court for the Western District of Michigan. Post-trial briefing is scheduled to be completed by late September 2021, when the case will be fully submitted for the court's decision. The total amount of cumulative deferred charge that we are seeking to receive in this litigation is approximately $111.6 million, which reflects the impact of conceding that Perrigo U.S. should have received a 5.24% royalty on all omeprazole sales. That concession was previously paid and is the subject of the above refund claims. The issues outlined in the statutory notices of deficiency described above are continuing, and the IRS will likely carry forward the adjustments set forth therein as long as the drug is sold, in the case of the omeprazole issue, and for all post-2012 Paragraph IV

30

Perrigo Company plc - Item 1

Note 15

filings that trigger patent infringement suits, in the case of the ANDA issue. On April 30, 2021, we filed a Notice of New Authority in our refund case in the Western District of Michigan alerting the court to a Tax Court decision in Mylan v. Comm'r that ruled in favor of the taxpayer on the identical ANDA issues we have before the court.

On January 13, 2021, the IRS issued a 30-day letter with respect to its audit of our fiscal tax years ended June 29, 2013 (the "2013 tax year"), June 28, 2014 (the "2014 tax year"), and June 27, 2015 (the "2015 tax year" and together with the 2013 tax year and the 2014 tax year, the "2013-2015 tax years"). The IRS letter proposed, among other modifications, carryforwards of the transfer pricing adjustments regarding our profits from the distribution of omeprazole in the aggregate amount of $141.6 million and ANDA adjustments in the aggregate amount of $21.9 million. The 30-day letter also set forth adjustments described in the next two paragraphs. We timely filed a protest to the 30-day letter for those additional adjustments, but noting that due to the pending litigation described above, IRS Appeals will not consider the merits of the omeprazole or ANDA matters. We believe that we should prevail on the merits on both carryforward issues and have reserved for taxes and interest payable on the 5.24% deemed royalty on omeprazole through the tax year ended December 31, 2018. Beginning with the tax year ended December 31, 2019, we began reporting income commensurate with the 5.24% deemed royalty. We have not reserved for the ANDA-related issue described above. While we believe we should prevail on the merits of this case, the outcome remains uncertain. If our litigation position on the omeprazole issue is not sustained, the outcome for the 2009–2012 tax years could range from a reduction in the refund amount to denial of any refund. In addition, we expect that the outcome of the refund litigation could effectively bind future tax years. In that event, an adverse ruling on the omeprazole issue could have a material impact on subsequent periods, with additional tax liability in the range of $24.0 million to $112.0 million, not including interest and any applicable penalties.

The 30-day letter for the 2013-2015 tax years also proposed to reduce Perrigo U.S.'s deductible interest expense for the 2014 tax year and the 2015 tax year on $7.5 billion in debts owed by it to Perrigo Company plc. The debts were incurred in connection with the Elan merger transaction in 2013. On May 7, 2020, the IRS issued a NOPA capping the interest rate on the debts for U.S. federal tax purposes at 130.0% of the Applicable Federal Rate ("AFR") (a blended rate reduction of 4.0% per annum), on the stated ground that the loans were not negotiated on an arms’-length basis. The NOPA proposes a reduction in gross interest expense of approximately $414.7 million for tax years 2014 and 2015. On January 13, 2021, we received a Revenue Agent Report ("RAR"), together with the 30-day letter, requiring our filing of a written Protest to request IRS Appeals consideration. The Protest was filed with the IRS on February 26, 2021. On May 3, 2021, the IRS notified us that it will no longer pursue the 130% of AFR position reflected in its NOPA due to a change in IRS policy. The IRS will provide a new proposed adjustment in its rebuttal to our Protest, which we have not yet received. Because the IRS' revised adjustment is currently unknown and cannot be quantified, we are unable to determine the amount of gross interest expense that the IRS proposes to disallow, and we cannot estimate any increase in tax expense attributable to any such disallowance for the period under audit. In addition, we expect the IRS to seek similar revised adjustments for the tax years ended December 31, 2015 through December 31, 2018 with potential section 163(j) carryover impacts beyond December 2018. We cannot determine the amount, if any, of the estimated increase in tax expense attributable to any such adjustments. No further interest adjustments are expected beyond this period. We strongly disagree with the IRS position and we will pursue all available administrative and judicial remedies necessary. At this stage, we are unable to estimate any additional liability associated with this matter.

In addition, the 30-day letter for the 2013-2015 tax years expanded on a NOPA issued on December 11, 2019 and proposed to disallow adjustments to gross sales income on the sale of prescription products to wholesalers for accrued wholesale customer pipeline chargebacks where the prescription products were not re-sold by such wholesalers to covered retailers by the end of the tax year for the 2013-2015 tax years. The IRS' NOPA asserts that the reduction of gross sales income of such chargebacks is an impermissible method of accounting. The IRS proposed a change in accounting method that would defer the reduction in gross sales income until the year the prescription products were re-sold to covered retailers. The NOPA proposes an increase in sales revenue of approximately $99.5 million for the 2013-2015 tax years. We filed a protest on February 26, 2021 to request IRS Appeals consideration. If the IRS were to prevail in its proposed adjustment, we estimate a payment of approximately $18.0 million, excluding interest and penalties for the 2013-2015 tax years. In addition, we expect the IRS to seek similar adjustments for future years. If those future adjustments were to be sustained, based on preliminary calculations and subject to further analysis, our current best estimate is a payment that will not exceed $7.0 million through tax year ended December 31, 2020, excluding interest and penalties. We have fully reserved for this issue. We strongly disagree with the IRS’s proposed adjustment and will pursue all available administrative and judicial remedies necessary.

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Note 15

Internal Revenue Service Audit of Athena Neurosciences, Inc., a U.S. Subsidiary    

On April 26, 2019, we received a revised NOPA from the IRS regarding transfer pricing positions related to the IRS audit of Athena Neurosciences, Inc. ("Athena") for the years ended December 31, 2011, December 31, 2012, and December 31, 2013. The NOPA carries forward the IRS's theory from its 2017 draft NOPA that when Elan took over the future funding of Athena's in-process research and development after acquiring Athena in 1996, Elan should have paid a substantially higher royalty rate for the right to exploit Athena’s intellectual property, rather than rates based on transfer pricing documentation prepared by Elan's external tax advisors. The NOPA proposes a payment of $843.0 million, which represents additional tax and a 40.0% penalty. This amount excludes consideration of offsetting tax attributes and any potential interest that may be imposed. We strongly disagree with the IRS position. On December 22, 2016, we also received a NOPA for these years denying the deductibility of settlement costs related to illegal marketing of Zonegran in the United States raised in a Qui Tam action. We strongly disagree with the IRS' position on this issue as well. Because we believe that any concession on these issues in Appeals would be contrary to our evaluation of the issues, we pursued our remedies under the U.S. - Ireland Income Tax Treaty to alleviate double taxation. On April 14, 2020, we filed a request for Competent Authority Assistance with the IRS on the royalty issue, and it was accepted. On October 20, 2020, we amended our request for Competent Authority Assistance to include the Zonegran issue and this amendment was also accepted. On May 6, 2021, we had our opening conference with the IRS and discussed our submission, which continues to be reviewed by the IRS. Our opening conference with Irish Revenue was held on July 23, 2021 and we discussed our submission, which continues to be reviewed by Irish Revenue.

No payment of the additional amounts is required until these two matters are resolved with finality under the treaty, or any additional administrative or judicial process if treaty negotiations are unsuccessful.

Irish Revenue Audit of Fiscal Years Ended December 31, 2012 and December 31, 2013

On October 30, 2018, we received an audit findings letter from the Irish Office of the Revenue Commissioners (“Irish Revenue”) for the tax years ended December 31, 2012 and December 31, 2013. The audit findings letter relates to the tax treatment of the 2013 sale of the Tysabri® intellectual property and related assets to Biogen Idec by Elan Pharma. The consideration paid by Biogen Idec to Elan Pharma took the form of an upfront payment and future contingent royalty payments. Elan Pharma recognized such receipts as trading income in its tax returns filed with Irish Revenue, consistent with Elan Pharma's historical practice relating to its active management of intellectual property rights.

In its audit findings letter, Irish Revenue proposed to charge Elan Pharma tax on the net chargeable gain realized by Elan Pharma on the Tysabri® transaction in 2013 at a rate of 33%, rather than the 12.5% tax rate applied to trading income. On November 29, 2018, Irish Revenue issued a Notice of Amended Assessment (“NoA”) for the tax year ended December 31, 2013, in the amount of €1,643 million, and claiming tax payable in the amount of €1,636 million, not including any interest or applicable penalties.

We strongly disagree with this assessment and believe that the NoA is without merit and incorrect as a matter of law. We will pursue all available administrative and judicial avenues as may be necessary or appropriate. Accordingly, we filed an appeal of the NoA on December 27, 2018 with the Irish Tax Appeals Commission ("TAC") which is the statutory body charged with considering whether the NoA is properly founded as a matter of Irish tax law. Separately, we were also granted leave by the Irish High Court on February 25, 2019 to seek judicial review of the issuance of the NoA by Irish Revenue.

On November 4, 2020, the High Court ruled that the Irish Revenue's decision to issue the NoA did not violate Elan Pharma's constitutional rights and legitimate expectations as a taxpayer. Importantly, the Irish High Court did not rule on the merits of the NoA under Irish tax law. The TAC will now consider whether the NoA is correct as a matter of Irish tax law. The tax appeal is scheduled to be heard in November 2021.

We strongly believe that Elan Pharma’s tax position is correct and would ultimately be confirmed through judicial process. However, in light of the risks and delays inherent in any litigation, representatives of Perrigo met with representatives of Irish Revenue on March 18, 2021 and April 14, 2021, to explore whether there may be a path forward toward resolving the dispute. On April 26, 2021, Perrigo, through its tax adviser, made a without prejudice written offer of settlement to Irish Revenue detailing a possible framework for such a resolution, which

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Note 15

applied an alternative basis of taxation than the respective positions taken by Irish Revenue in the NoA and by Elan Pharma in its tax returns. On May 31, 2021, Irish Revenue issued a formal response to Perrigo's tax adviser indicating that the written settlement offer would not be accepted as presented. While that offer was not accepted, Irish Revenue indicated that they remain available for further discussion without prejudice. The Company’s representatives continue to meet and correspond with Irish Revenue, and Perrigo anticipates further discussions prior to the TAC hearing in November 2021.

On July 9, 2021, Irish Revenue issued a letter acknowledging that not all relevant facts were known to them when they issued the NoA in 2018 and, accordingly, they would not object if the Appeal Commissioner were to make certain adjustments reducing Irish Revenue’s original assessment. Such adjustments would reflect contingent royalty payments that were never received by Elan Pharma, deductions for acquisition and development costs incurred, and allowable losses and reliefs, and would, if allowed, result in an aggregate reduction of more than €660.0 million from the income taxes claimed in the NoA as issued. The reduced claim is not a settlement proposal or compromise by Irish Revenue, but rather a confirmation that Irish Revenue would not object to certain adjustments to the underlying assessment given facts now known to Irish Revenue that were not known to Irish Revenue when they issued the NoA in 2018. Accordingly, Perrigo believes that the maximum amount of income tax claims in dispute is now reduced to less than €1.0 billion, not including any interest or penalties, if applicable.

There can be no assurances that any settlement is possible on terms acceptable to Perrigo. Unless and until a final settlement is reached, Elan Pharma will vigorously pursue its tax appeal before the TAC, concurrently with any settlement discussions that may occur. No payment of any additional tax will be required unless and until required by a settlement or other final determination.

Israel Tax Authority Audit of Fiscal Year Ended June 27, 2015 and Calendar Years Ended December 31, 2015 through December 31, 2019

The Israel Tax Authority ("ITA") audited our income tax returns for the 2015 tax year, and calendar years ended December 31, 2015, December 31, 2016 and December 31, 2017. On December 29, 2020, we received a Stage A assessment from the ITA for the tax years ended December 31, 2015 through December 31, 2017 in the amount of $63.8 million relating to attribution of intangible income to Israel, income qualifying for a lower preferential rate of tax, exemption from capital gains tax, and deduction of certain settlement payments. Our protest was timely filed on March 11, 2021 to move the matter to Stage B of the assessment process.

Through negotiations with the ITA, we resolved the audit for the tax year ended June 27, 2015 through tax year ended December 31, 2019, by agreeing to add tax year ended December 31, 2018 and tax year ended December 31, 2019 to the audit period to reach an agreeable resolution to provide certainty for these additional periods. The agreement with the ITA required us to pay $19.0 million, after offset for refunds of $17.2 million, for the five taxable years. In addition, we paid $12.5 million to resolve a tax liability indemnity for the tax year ended December 31, 2017 relating to Perrigo API Ltd, which we disposed of in December 2017 (refer to Note 16).

As a result of the settlement with the ITA, we reduced our liability recorded for uncertain tax positions by $38.3 million including interest.

    Although we believe that our tax estimates are reasonable and that we prepare our tax filings in accordance with all applicable tax laws, the final determination with respect to any tax audit and any related litigation could be materially different from our estimates or from our historical income tax provisions and accruals. The results of an audit or litigation could have a material effect on operating results and/or cash flows in the periods for which that determination is made. In addition, future period earnings may be adversely impacted by litigation costs, settlements, penalties, and/or interest assessments.

Based on the final resolution of tax examinations, judicial or administrative proceedings, changes in facts or law, expirations of statute of limitations in specific jurisdictions or other resolutions of, or changes in, tax positions - one or more of which may occur within the next twelve months - it is reasonably possible that unrecognized tax benefits for certain tax positions taken on previously filed tax returns may change materially from those recorded as of July 3, 2021. However, we are not able to estimate a reasonably possible range of how these events may impact our unrecognized tax benefits in the next twelve months.

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Note 16

NOTE 16 – CONTINGENCIES

    In view of the inherent difficulties of predicting the outcome of various types of legal proceedings, we cannot determine the ultimate resolution of the matters described below. We establish reserves for litigation and regulatory matters when losses associated with the claims become probable and the amounts can be reasonably estimated. The actual costs of resolving legal matters may be substantially higher or lower than the amounts reserved for those matters. For matters where the likelihood or extent of a loss is not probable or cannot be reasonably estimated as of July 3, 2021, we have not recorded a loss reserve. If certain of these matters are determined against us, there could be a material adverse effect on our financial condition, results of operations, or cash flows. We currently believe we have valid defenses to the claims in these lawsuits and intend to defend these lawsuits vigorously regardless of whether or not we have a loss reserve. Other than what is disclosed below, we do not expect the outcome of the litigation matters to which we are currently subject to have, individually or in the aggregate, a material adverse effect on our financial condition, results of operations, or cash flows.

Price-Fixing Lawsuits

Perrigo is a defendant in several cases in the generic pricing multidistrict litigation MDL No. 2724 (United States District Court for Eastern District of Pennsylvania). This multidistrict litigation, which has many cases that do not include Perrigo, includes class action and opt-out cases for federal and state antitrust claims, as well as complaints filed by certain states alleging violations of state antitrust laws.

On July 14, 2020, the court issued an order designating the following cases to proceed on a more expedited basis (as a bellwether) than the other cases in MDL No. 2724: (a) the May 2019 state case alleging an overarching conspiracy involving more than 120 products (which does not name Perrigo a defendant) and (b) class actions alleging “single drug” conspiracies involving Clomipramine, Pravastatin, and Clobetasol. Perrigo is a defendant in the Clobetasol cases but not the others. On February 9, 2021, the court entered an order provisionally deciding to remove the May 2019 state case and the pravastatin class cases from the bellwether proceedings. On May 7, 2021, the Court ruled that the clobetasol end payer and direct purchaser class cases will remain part of the bellwether. The Court also ruled that the June 10, 2020 State Complaint against Perrigo and approximately 35 other manufacturers will move forward as a bellwether case. No schedule has been set for the bellwether cases.

Class Action Complaints

(a) Single Drug Conspiracy Class Actions

We have been named as a co-defendant with certain other generic pharmaceutical manufacturers in a number of class actions alleging single-product conspiracies to fix or raise the prices of certain drugs and/or allocate customers for those products starting, in some instances, as early as June 2013. The class actions were filed on behalf of putative classes of (a) direct purchasers, (b) end payors, and (c) indirect resellers. The products in question are Clobetasol gel, Desonide, and Econazole. The court denied motions to dismiss each of the complaints alleging “single drug” conspiracies involving Perrigo, and the cases are proceeding in discovery. As noted above, the Clobetasol cases have been designated to proceed on a more expedited schedule than the other cases. That schedule has not yet been set.

(b) “Overarching Conspiracy” Class Actions

The same three putative classes, including (a) direct purchasers, (b) end payors, and (c) indirect resellers, have filed two sets of class action complaints alleging that Perrigo and other manufacturers (and some individuals) entered into an “overarching conspiracy” that involved allocating customers, rigging bids and raising, maintaining, and fixing prices for various products. Each class brings claims for violations of Sections 1 and 3 of the Sherman Antitrust Act as well as several state antitrust and consumer protection statutes.

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Note 16

Filed in June 2018, and later amended in December 2018 (with respect to direct purchasers) and April 2019 (with respect to end payors and indirect resellers), the first set of “overarching conspiracy” class actions include allegations against Perrigo and approximately 27 other manufacturers involving 135 drugs with allegations dating back to March 2011. The allegations against Perrigo concern only two formulations (cream and ointment) of one of the products at issue, Nystatin. The court denied motions to dismiss the first set of “overarching conspiracy” class actions, and they are proceeding in discovery. None of these cases are included in the group of cases on a more expedited schedule pursuant to the court’s July 14, 2020 order.

In December 2019, both the end payor and indirect reseller class plaintiffs filed a second set of "overarching conspiracy” class actions against Perrigo, dozens of other manufacturers of generic prescription pharmaceuticals, and certain individuals dating back to July 2009 (end payors) or January 2010 (indirect resellers). The direct purchaser plaintiffs filed their second round overarching conspiracy complaint in February 2020 with claims dating back to July 2009. On March 11, 2020, the indirect reseller plaintiffs filed a motion to amend their second round December 2019 complaint, and that motion was granted. On September 4, 2020, and December 15, 2020, the end payor plaintiffs amended their second round complaint. On October 21, 2020, the direct purchaser plaintiffs amended their second round complaint. On December 15, 2020, the indirect reseller plaintiffs filed another complaint adding allegations for additional drugs that mirror the other class plaintiffs’ claims.

This second set of overarching complaints allege conspiracies relating to the sale of various products that are not at issue in the earlier-filed overarching conspiracy class actions, the majority of which Perrigo neither makes nor sells. The amended indirect reseller complaint alleges that Perrigo conspired in connection with its sales of Betamethasone Dipropionate lotion, Imiquimod cream, Desonide cream and ointment, and Hydrocortisone Valerate cream. The December 2020 indirect reseller complaint alleges that Perrigo conspired in connection with its sales of Adapalene, Ammonium Lactate, Bromocriptine Mesylate, Calcipotriene, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Methazolamide, Mometasone Furoate, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide. The amended end payor complaint alleges that Perrigo conspired in connection with its sale of the following drugs: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fenofibrate, Fluocinonide, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Mometasone Furoate, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide. The amended direct purchaser complaint alleges that Perrigo conspired in connection with its sale of the following drugs: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Ciclopirox, Clindamycin Phosphate, Fenofibrate, Fluocinonide, Halobetasol Proprionate, Hydrocortisone Valerate, Methazolamide, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide.

Perrigo has not yet responded to the second set of overarching conspiracy complaints, and responses are currently stayed.

Opt-Out Complaints

On January 22, 2018, Perrigo was named a co-defendant along with 35 other manufacturers in a complaint filed by three supermarket chains alleging that defendants conspired to fix prices of 31 generic prescription pharmaceutical products starting in 2013. On December 21, 2018, an amended complaint was filed that adds additional products and allegations against a total of 39 manufacturers for 33 products. The only allegations specific to Perrigo relate to Clobetasol, Desonide, Econazole, Nystatin cream, and Nystatin ointment. Perrigo moved to dismiss this complaint on February 21, 2019. The motion was denied on August 15, 2019. The case is proceeding in discovery. On February 3, 2020, the plaintiffs requested leave to file a second amended complaint. The proposed amended complaint adds dozens of additional products and allegations to the original complaint. Perrigo is discussed in connection with allegations concerning an additional drug, Fenofibrate. Defendants opposed the motion for leave to file a second amended complaint and the court has yet to rule on the issue.

On August 3, 2018, a large managed care organization filed a complaint alleging price-fixing and customer allocation concerning 17 different products among 27 manufacturers including Perrigo. The only allegations specific to Perrigo concern Clobetasol. Perrigo moved to dismiss this complaint on February 21, 2019. Plaintiff filed a second amended complaint in April 2019 that adds additional products and allegations. The amended allegations

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Note 16

that concern Perrigo include: Clobetasol, Desonide, Econazole, and Nystatin. The motion to dismiss was denied on August 15, 2019. The case is proceeding in discovery.

The same organization amended a different complaint that it had filed in October 2019, which did not name Perrigo, on December 15, 2020, adding Perrigo as a defendant and asserting new allegations of alleged antitrust violations involving Perrigo and dozens of other generic pharmaceutical manufacturers. The allegations relating to Perrigo concern: Adapalene, Betamethasone Dipropionate, Bromocriptine Mesylate, Ciclopirox, Clindamycin Phosphate, Fenofibrate, Fluocinonide, Halobetasol Proprionate, Hydrocortisone Valerate, Imiquimod, Permethrin, Prochlorperazine Maleate, and Triamcinolone Acetonide.

The same organization filed a third complaint on December 15, 2020, naming Perrigo and dozens of other manufacturers alleging antitrust violations concerning generic pharmaceutical drugs. The allegations relating to Perrigo concern: Ammonium Lactate, Calcipotriene Betamethasone Dipropionate, Erythromycin, Fluticasone Propionate, Hydrocortisone Acetate, Methazolamide, Promethazine HCL, and Tacrolimus.

On January 16, 2019, a health insurance carrier filed a complaint in the U.S. District Court for the District of Minnesota alleging a conspiracy to fix prices of 30 products among 30 defendants. The only allegations specific to Perrigo concerned Clobetasol gel, Desonide, Econazole, Nystatin cream, and Nystatin ointment. Perrigo has not yet responded to the complaint, and responses are currently stayed. On December 15, 2020, the complaint was amended to add additional defendants and claims. The new allegations that concern Perrigo relate to Fluocinonide.

The same health insurance carrier filed a new complaint on December 15, 2020, naming Perrigo and dozens of other manufacturers alleging antitrust violations concerning generic pharmaceutical drugs. The allegations relating to Perrigo concern: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide.

On July 18, 2019, 87 health plans filed a Praecipe to Issue Writ of Summons in Pennsylvania state court to commence an action against 53 generic pharmaceutical manufacturers and 17 individuals, alleging antitrust violations concerning generic pharmaceutical drugs. While Perrigo was named as a defendant, no complaint has been filed and the precise allegations and products at issue have not been identified. Proceedings in the case, including the filing of a complaint, have been stayed at the request of the plaintiffs.

On December 11, 2019, a health care service company filed a complaint against Perrigo and 38 other pharmaceutical companies alleging an overarching conspiracy to fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other multi-district litigation ("MDL") complaints naming Perrigo: Clobetasol, Desonide, Econazole, and Nystatin cream/ointment. Perrigo has not yet responded to the complaint, and responses are currently stayed. On December 15, 2020, the complaint was amended to add additional defendants and claims. The new allegations relating to Perrigo concern: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fenofibrate, Fluocinonide, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide.

On December 16, 2019, a Medicare Advantage claims recovery company filed a complaint against Perrigo and 39 other pharmaceutical companies alleging an overarching conspiracy to fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other MDL complaints naming Perrigo: Clobetasol, Desonide, and Econazole. The complaint was originally filed in the District of Connecticut but has been consolidated into the MDL. Perrigo has not yet had the opportunity to respond to the complaint, and responses are currently stayed. On December 15, 2020, the complaint was amended to add additional defendants and claims. The new allegations relating to Perrigo concern: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Desoximetasone, Erythromycin, Fenofibrate, Fluocinonide, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate,

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Note 16

Hydrocortisone Valerate, Imiquimod, Methazolamide, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide.

On December 23, 2019, several counties in New York filed an amended complaint against Perrigo and 28 other pharmaceutical companies alleging an overarching conspiracy to fix, raise or stabilize prices of dozens products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other MDL complaints naming Perrigo: Clobetasol, Desonide, Econazole, and Nystatin. The complaint was originally filed in New York State court but was removed to federal court and has been consolidated into the MDL. Perrigo has not yet responded to the complaint, and responses are currently stayed. On December 15, 2020, the complaint was amended to add additional defendants and claims. The new allegations relating to Perrigo concern: Adapalene, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Mometasone Furoate, Nystatin, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide. On June 30, 2021, the counties filed a proposed revised second amended complaint. Perrigo has not yet responded to the complaint, and responses will be stayed.

On December 27, 2019, a healthcare management organization filed a complaint against Perrigo and 25 other pharmaceutical companies alleging an overarching conspiracy to fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other MDL complaints naming Perrigo: Clobetasol, Desonide, Econazole, and Nystatin. The complaint was filed originally in the Northern District of California but has been consolidated into the MDL. Perrigo has not yet responded to the complaint, and responses are currently stayed. On December 15, 2020, the complaint was amended to add additional defendants and claims. The new allegations relating to Perrigo concern: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fenofibrate, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide.

On March 1, 2020, Harris County of Texas filed a complaint against Perrigo and 29 other pharmaceutical companies alleging an overarching conspiracy to fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The products at issue that plaintiffs claim Perrigo manufacturers or sells include: Adapalene, Betamethasone Dipropionate, Ciclopirox, Clindamycin, Clobetasol, Desonide, Econazole, Ethinyl Estradiol/Levonorgestrel, Fenofibrate, Fluocinolone, Fluocinonide, Gentamicin, Glimepiride, Griseofulvin, Halobetasol Propionate, Hydrocortisone Valerate, Ketoconazole, Mupirocin, Nystatin, Olopatadine, Permethrin, Prednisone, Promethazine, Scopolamine, and Triamcinolone Acetonide. The complaint was originally filed in the Southern District of Texas but has been transferred to the MDL. Harris County amended its complaint in May 2020. Perrigo has not yet responded to the complaint, and responses are currently stayed.

In May 2020, seven health plans filed a writ of summons in the Pennsylvania Court of Common Pleas in Philadelphia concerning an as-yet unfiled complaint against Perrigo, three dozen other manufacturers, and seventeen individuals, concerning alleged antitrust violations in connection with the pricing and sale of generic prescription pharmaceutical products. No complaint has yet been filed, so the precise allegations and products at issue are not yet clear. In addition, Defendants are in the process of being served, and proceedings in the case will likely be stayed.

On June 9, 2020, a health insurance carrier filed a complaint against Perrigo and 25 other manufacturers alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other MDL complaints naming Perrigo: Clobetasol, Desonide, Econazole, and Nystatin. The complaint was filed in the Eastern District of Pennsylvania and has been transferred into the MDL. Perrigo has not yet responded to the complaint, and responses are currently stayed. On December 15, 2020, the complaint was amended to add additional defendants and claims. The new allegations relating to Perrigo concern: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fluocinonide, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide.

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On July 9, 2020, a drugstore chain filed a complaint against Perrigo and 39 other pharmaceutical companies alleging an overarching conspiracy to fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other MDL complaints naming Perrigo: Clobetasol, Desonide, Econazole, and Nystatin. Perrigo is also listed in connection with Fenofibrate. The complaint was filed in the Eastern District of Pennsylvania and will be transferred into the MDL. Perrigo has not yet responded to the complaint, and responses are currently stayed. On December 15, 2020, the complaint was amended to add additional defendants and claims. The new allegations relating to Perrigo concern: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fenofibrate, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide.

On August 27, 2020, Suffolk County of New York filed a complaint against Perrigo and 35 other manufacturers alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other MDL complaints naming Perrigo: Clobetasol, Desonide, Econazole, and Nystatin cream and ointment. The other products at issue that plaintiffs claim Perrigo manufacturers or sells include: Adapalene gel, Albuterol, Benazepril HCTZ, Clotrimazole, Diclofenac Sodium, Fenofibrate, Fluocinonide, Glimepiride, Ketoconazole, Meprobamate, Imiquimod, Triamcinolone Acetonide, Erythromycin/Ethyl Solution, Betamethasone Valerate, Ciclopirox Olamine, Terconazole, Hydrocortisone Valerate, Fluticasone Propionate, Desoximetasone, Clindamycin Phosphate, Halobetasol Propionate, Hydrocortisone Acetate, Promethazine HCL, Mometasone Furoate, and Amiloride HCTZ. The complaint was filed in the Eastern District of New York and has been transferred into the MDL. Perrigo has not yet responded to the complaint, and responses are currently stayed.

On September 4, 2020, a drug wholesaler and distributor filed a complaint against Perrigo and 39 other manufacturers alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin, Clobetasol, Desonide, Econazole, Erythromycin, Fenofibrate, Fluticasone, Halobetasol, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Mometasone furoate, Nystatin, Prochlorperazine, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide. The complaint was filed in the Eastern District of Pennsylvania and has been transferred into the MDL. Perrigo has not yet responded to the complaint, and responses are currently stayed.

On December 11, 2020, a drugstore chain filed a complaint against Perrigo and 45 other manufacturers alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Clobetasol, Desonide, Econazole, Erythromycin, Fenofibrate, Fluticasone Propionate, Halobetasol, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Nystatin, Permethrin, Prochlorperazine, Promethazine HCL, Tacrolimus, and Triamcinolone. The complaint was filed in the Eastern District of Pennsylvania and has been transferred into the MDL.

On December 14, 2020, a supermarket chain filed a complaint against Perrigo and 45 other manufacturers (as well as certain individuals) alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on Betamethasone Dipropionate, Bromocriptine Mesylate, Ciclopirox, Clindamycin Phosphate, Clobetasol, Desonide, Econazole, Fenofibrate, Halobetasol, Hydrocortisone Valerate, Nystatin, Permethrin, and Triamcinolone Acetonide. The complaint was filed in the Eastern District of Pennsylvania and has been transferred into the MDL.

On December 15, 2020, a drugstore chain filed a complaint against Perrigo and 45 other manufacturers alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The complaint lists 63 drugs that the chain purchased from Perrigo, but the product conspiracies allegedly involving Perrigo focus on Adapalene, Betamethasone Dipropionate,

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Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Desonide, Econazole, Erythromycin, Fluocinonide, Fluticasone Propionate, Halobetasol, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Nystatin, Prochlorperazine, Promethazine HCL, Tacrolimus, and Triamcinolone. The complaint was filed in the Eastern District of Pennsylvania and has been transferred into the MDL.

On December 15, 2020, several counties in New York filed a complaint against Perrigo and 45 other pharmaceutical companies alleging an overarching conspiracy to fix, raise or stabilize prices of dozens products, most of which Perrigo neither makes nor sells. The allegations that concern Perrigo include: Adapalene, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Mometasone Furoate, Nystatin, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide. The complaint was originally filed in New York State court but has been removed to federal court and consolidated into the MDL. The counties filed an amended complaint on June 30, 2021.

State Attorney General Complaint

On June 10, 2020, the Connecticut Attorney General’s office filed a lawsuit on behalf of Connecticut and 50 other states and territories against Perrigo, 35 other generic pharmaceutical manufacturers, and certain individuals (including one former and one current Perrigo employee), alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of eighty products. The allegations against Perrigo focus on the following drugs: Adapalene Cream, Ammonium Lactate cream and lotion, Betamethasone dipropionate lotion, Bromocriptine tablets, Calcipotriene Betamethasone Dipropionate Ointment, Ciclopirox cream and solution, Clindamycin solution, Desonide cream and ointment, Econazole cream, Erythromycin base alcohol solution, Fluticasone cream and lotion, Halobetasol cream and ointment, Hydrocortisone Acetate suppositories, Hydrocortisone Valerate cream, Imiquimod cream, Methazolamide tablets, Nystatin ointment, Prochlorperazine suppositories, Promethazine HCL suppositories, Tacrolimus ointment, and Triamcinolone cream and ointment. The Complaint was filed in the District of Connecticut, but has been transferred into the MDL. Perrigo has not yet responded to the complaint, and responses are currently stayed. On May 7, 2021, the Court ruled that this case will move forward as a bellwether case. Perrigo has not yet responded to the complaint, and no schedule has been set for such responses.

Canadian Class Action Complaint

In June 2020, an end payor filed a class action in Ontario, Canada against Perrigo and 29 other manufacturers alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other MDL complaints naming Perrigo: Clobetasol, Desonide, Econazole, and Nystatin. In December 2020, Plaintiffs amended their complaint to add additional claims based on the State AG complaint of June 2020.

At this stage, we cannot reasonably estimate the outcome of the liability if any, associated with the claims listed above.

Securities Litigation

In the United States (cases related to events in 2015-2017)

On May 18, 2016, a shareholder filed a securities case against us and our former CEO, Joseph Papa, in the U.S. District Court for the District of New Jersey (Roofers’ Pension Fund v. Papa, et al.). The plaintiff purported to represent a class of shareholders for the period from April 21, 2015 through May 11, 2016, inclusive. The original complaint alleged violations of Securities Exchange Act sections 10(b) (and Rule 10b5) and 14(e) against both defendants and 20(a) control person liability against Mr. Papa. In general, the allegations concerned the actions taken by us and the former executive to defend against the unsolicited takeover bid by Mylan in the period from April 21, 2015 through November 13, 2015. The plaintiff also alleged that the defendants provided inadequate disclosure concerning alleged integration problems related to the Omega acquisition in the period from April 21, 2015 through May 11, 2016. On July 19, 2016, a different shareholder filed a securities class action against us and our former CEO, Joseph Papa, also in the District of New Jersey (Wilson v. Papa, et al.). The plaintiff purported to represent a

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class of persons who sold put options on our shares between April 21, 2015 and May 11, 2016. In general, the allegations and the claims were the same as those made in the original complaint filed in the Roofers' Pension Fund case described above. On December 8, 2016, the court consolidated the Roofers' Pension Fund case and the Wilson case under the Roofers' Pension Fund case number. In February 2017, the court selected the lead plaintiffs for the consolidated case and the lead counsel to the putative class. In March 2017, the court entered a scheduling order.

On June 21, 2017, the court-appointed lead plaintiffs filed an amended complaint that superseded the original complaints in the Roofers’ Pension Fund case and the Wilson case. In the amended complaint, the lead plaintiffs seek to represent three classes of shareholders: (i) shareholders who purchased shares during the period from April 21, 2015 through May 3, 2017 on the U.S. exchanges; (ii) shareholders who purchased shares during the same period on the Tel Aviv exchange; and (iii) shareholders who owned shares on November 12, 2015 and held such stock through at least 8:00 a.m. on November 13, 2015 (the final day of the Mylan tender offer) regardless of whether the shareholders tendered their shares. The amended complaint names as defendants us and 11 current or former directors and officers of Perrigo (Mses. Judy Brown, Laurie Brlas, Jacqualyn Fouse, Ellen Hoffing, and Messrs. Joe Papa, Marc Coucke, Gary Cohen, Michael Jandernoa, Gerald Kunkle, Herman Morris, and Donal O’Connor). The amended complaint alleges violations of Securities Exchange Act sections 10(b) (and Rule 10b‑5) and 14(e) against all defendants and 20(a) control person liability against the 11 individuals. In general, the allegations concern the actions taken by us and the former executives to defend against the unsolicited takeover bid by Mylan in the period from April 21, 2015 through November 13, 2015 and the allegedly inadequate disclosure throughout the entire class period related to purported integration problems related to the Omega acquisition, alleges incorrect reporting of organic growth at the Company and at Omega, alleges price fixing activities with respect to six generic prescription pharmaceuticals, and alleges improper accounting for the Tysabri® royalty stream. The amended complaint does not include an estimate of damages. During 2017, the defendants filed motions to dismiss, which the plaintiffs opposed. On July 27, 2018, the court issued an opinion and order granting the defendants’ motions to dismiss in part and denying the motions to dismiss in part. The court dismissed without prejudice defendants Laurie Brlas, Jacqualyn Fouse, Ellen Hoffing, Gary Cohen, Michael Jandernoa, Gerald Kunkle, Herman Morris, Donal O’Connor, and Marc Coucke. The court also dismissed without prejudice claims arising from the Tysabri® accounting issue described above and claims alleging incorrect disclosure of organic growth described above. The defendants who were not dismissed are Perrigo Company plc, Joe Papa, and Judy Brown. The claims (described above) that were not dismissed relate to the integration issues regarding the Omega acquisition, the defense against the Mylan tender offer, and the alleged price fixing activities with respect to six generic prescription pharmaceuticals. The defendants who remain in the case (the Company, Mr. Papa, and Ms. Brown) have filed answers denying liability, and the discovery stage of litigation began in late 2018. Discovery in the class action ended on January 31, 2021. In early April 2021, the defendants filed various post-discovery motions, including summary judgment motions; the briefing of which was completed in early July 2021. The motions are now before the court. We intend to defend the lawsuit vigorously.

On November 14, 2019, the court granted the lead plaintiffs’ motion and certified three classes for the case: (i) all those who purchased shares between April 21, 2015 through May 2, 2017 inclusive on a U.S. exchange and were damaged thereby; (ii) all those who purchased shares between April 21, 2015 through May 2, 2017 inclusive on the Tel Aviv exchange and were damaged thereby; and (iii) all those who owned shares as of November 12, 2015 and held such stock through at least 8:00 a.m. on November 13, 2015 (whether or not a person tendered shares in response to the Mylan tender offer) (the "tender offer class"). Defendants filed a petition for leave to appeal in the Third Circuit challenging the certification of the tender offer class. On April 30, 2020, the Third Circuit denied leave to appeal. The District Court has approved the issuance of a notice of the pendency of the class action, and the notice has been sent to shareholders who are eligible to participate in the classes.

Unless otherwise noted, each of the lawsuits discussed in the following sections is pending in the U.S. District Court for the District of New Jersey and has been assigned to the same judges hearing the Roofers’ Pension Fund case. The allegations in the complaints relate to events during certain portions of the 2015 through 2017 calendar years, including the period of the Mylan tender offer. All but one of these lawsuits allege violations of federal securities laws, but none are class actions. One lawsuit (Highfields) alleges only state law claims. Discovery in all these cases, except Starboard Value and Highfields, is underway and currently scheduled to end in early October 2021. We intend to defend all these lawsuits vigorously.

Carmignac, First Manhattan and Similar Cases. The following seven cases were filed by the same law firm and generally make the same factual assertions but, at times, differ as to which securities laws violations they allege:

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Case	Date Filed
Carmignac Gestion, S.A. v. Perrigo Company plc, et al.	11/1/2017
First Manhattan Co. v. Perrigo Company plc, et al.	2/16/2018; amended 4/20/2018
Nationwide Mutual Funds, et al. v. Perrigo Company plc, et al.	10/29/2018
Schwab Capital Trust, et al. v. Perrigo Company plc, et al.	1/31/2019
Aberdeen Canada Funds -- Global Equity Fund, et al. v. Perrigo Company plc, et al.	2/22/2019
Principal Funds, Inc., et al. v. Perrigo Company plc, et al.	3/5/2020
Kuwait Investment Authority, et al. v. Perrigo Company plc, et al.	3/31/2020

The original complaints in the Carmignac case and the First Manhattan case named Perrigo, Mr. Papa, Ms. Brown, and Mr. Coucke as defendants. Mr. Coucke was dismissed as a defendant after the plaintiffs agreed to apply the July 2018 ruling in the Roofers' Pension Fund case to these two cases. The complaints in each of the other cases name only Perrigo, Mr. Papa, and Ms. Brown as defendants.

Each complaint asserts claims under Sections 10(b) (and Rule 10b-5 thereunder) and all cases except Aberdeen assert claims under Section 14(e) of the Securities Exchange Act against all defendants, as well as control person liability under Section 20(a) of the Securities Exchange Act against the individual defendants. The control person claims against the individual defendants are limited to the period from April 2015 through April 2016 in the Carmignac case. The complaints in the Carmignac and First Manhattan cases also assert claims under Section 18 of the Exchange Act.

Each complaint alleges inadequate disclosures concerning the valuation and integration of Omega, the financial guidance we provided, our reporting about the generic prescription pharmaceutical business and its prospects, and the activities surrounding the efforts to defeat the Mylan tender offer during 2015, and, in each of the cases other than Carmignac, alleged price fixing activities with respect to six generic prescription pharmaceuticals. The First Manhattan complaint also alleges improper accounting for the Tysabri® asset. With the exception of Carmignac, each of these cases relates to events during the period from April 2015 through May 2017. Many of the allegations in these cases overlap with the allegations of the June 2017 amended complaint in the Roofers’ Pension Fund case, though the Nationwide Mutual, Schwab Capital, Aberdeen, Principal Funds and Kuwait complaints do not include the factual allegations that the court dismissed in the July 2018 ruling in the Roofers' Pension Fund case.

After the court issued its July 2018 opinion in the Roofers’ Pension Fund case, the parties in Carmignac and First Manhattan conferred and agreed that the ruling in the Roofers’ Pension Fund case would apply equally to the common allegations in their cases. The later filed cases adopted a similar posture. The defendants in the Carmignac and other cases listed above filed motions to dismiss addressing the additional allegations in such cases. On July 31, 2019, the court granted such motions to dismiss in part and denied them in part. That ruling applies to each of the above cases. The defendants have filed answers in each case denying liability. Each case is currently in the discovery phase.

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Mason Capital, Pentwater and Similar Cases. The following eight cases were filed by the same law firm and generally make the same factual allegations:

Case	Date Filed
Mason Capital L.P., et al. v. Perrigo Company plc, et al.	1/26/2018
Pentwater Equity Opportunities Master Fund Ltd., et al.  v. Perrigo Company plc, et al.	1/26/2018
WCM Alternatives: Event-Drive Fund, et al. v. Perrigo Co., plc, et al.	11/15/2018
Hudson Bay Master Fund Ltd., et al. v. Perrigo Co., plc, et al.	11/15/2018
Discovery Global Citizens Master Fund, Ltd., et al. v. Perrigo Co. plc, et al.	12/18/2019
York Capital Management, L.P., et al. v. Perrigo Co. plc, et al.	12/20/2019
Burlington Loan Management DAC v. Perrigo Co. plc, et al.	2/12/2020
Universities Superannuation Scheme Limited v. Perrigo Co. plc, et al.	3/2/2020

The complaints in the Mason Capital case and the Pentwater case originally named Perrigo and 11 current or former directors and officers of Perrigo as defendants. In the July 2018 Roofers’ Pension Fund ruling, the court dismissed without prejudice each of the defendants other than Perrigo, Mr. Papa and Ms. Brown from that case; these plaintiffs later agreed that this ruling would apply to their cases as well. The complaints in each of the other cases in the above table name only Perrigo, Mr. Papa, and Ms. Brown as defendants.

Each complaint asserts claims under Section 14(e) of the Securities Exchange Act against all defendants, as well as control person liability under Section 20(a) of the Securities Exchange Act against the individual defendants. The complaints in the WCM case and the Universities Superannuation Scheme case also assert claims under Section 10(b) of the Exchange Act and Rule 10b-5 thereunder.

Each complaint alleges inadequate disclosure during the tender offer period in 2015 and at various times concerning valuation and integration of Omega, the financial guidance provided by us during that period, alleged price fixing activities with respect to six generic prescription pharmaceuticals, and alleged improper accounting for the Tysabri® asset. The WCM complaint also makes these allegations for the period through May 2017 and the Universities Superannuation Scheme complaint also concerns certain times during 2016. Many of the factual allegations in these cases overlap with the allegations of the June 2017 amended complaint in the Roofers’ Pension Fund case, and the Mason Capital and Pentwater cases include factual allegations similar to those in the Carmignac case described above.

After the court issued its July 2018 opinion in the Roofers’ Pension Fund case, the parties in each of the above cases conferred and agreed that the ruling in the Roofers’ Pension Fund case would apply equally to the common allegations in their cases. The defendants in each of these cases have filed answers denying liability, and each of the cases is currently in the discovery phase.

Harel Insurance and TIAA-CREF Cases. The following two cases were filed by the same law firm and generally make the same factual allegations relating to the period from February 2014 through May 2017 (in the Harel case) and from August 2014 through May 2017 (in the TIAA-CREF case):

Case	Date Filed
Harel Insurance Company, Ltd., et al. v. Perrigo Company plc, et al.	2/13/2018
TIAA-CREF Investment Management, LLC., et al. v. Perrigo Company plc, et al.	4/20/2018

The complaints in the Harel and TIAA-CREF cases originally named Perrigo and 13 current or former directors and officers of Perrigo as defendants (adding two more individual defendants not sued in the other cases described in this section). In the July 2018 Roofers’ Pension Fund ruling, the court dismissed without prejudice 8 of the 11 defendants other than Perrigo, Mr. Papa and Ms. Brown from that case. These plaintiffs later agreed that that ruling would apply to these cases as well and also dismissed their claims against the two additional individuals that only these plaintiffs had named as defendants.

Each complaint asserts claims under Sections 10(b) and 14(e) of the Securities Exchange Act and Rule 10b-5 thereunder against all defendants, as well as control person liability under Section 20(a) of the Securities

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Exchange Act against the individual defendants. The complaint in the Harel case also asserts claims based on Israeli securities laws.

Each of the complaints alleges inadequate disclosure around the tender offer events in 2015 and at various times during the relevant periods concerning valuation and integration of Omega, the financial guidance provided by us during that period, alleged price fixing activities with respect to six generic prescription pharmaceuticals, and alleged improper accounting for the Tysabri® asset from February 2014 until the withdrawal of past financial statements in April 2017.

After the court issued its July 2018 opinion in the Roofers’ Pension Fund case, the parties in the Harel and TIAA-CREF cases conferred and agreed that such ruling would apply equally to the common allegations in their cases. The defendants in each of these cases have filed answers denying liability, and each of the cases is currently in the discovery phase.

Other Cases Related to Events in 2015-2017. Certain allegations in the following three cases also overlap with the allegations of the June 2017 amended complaint in the Roofers' Pension Fund case and with allegations in one or more of the other individual cases described in the sections above:

Case	Date Filed
Sculptor Master Fund (f/k/a OZ Master Fund, Ltd.), et al. v. Perrigo Company plc, et al.	2/6/2019
Highfields Capital I LP, et al. v. Perrigo Company plc, et al.	6/4/2020
BlackRock Global Allocation Fund, Inc., et al. v. Perrigo Co. plc, et al.	4/21/2020
Starboard Value and Opportunity C LP, et al. v. Perrigo Company plc, et al.	2/25/2021

Each of the above complaints names Perrigo, Mr. Papa, and Ms. Brown as defendants.

The Sculptor Master Fund (formerly OZ) complaint asserts claims under Sections 10(b) and 14(e) of the Securities Exchange Act and Rule 10b-5 thereunder against all defendants, as well as control person liability under Section 20(a) of the Securities Exchange Act against the individual defendants. The parties have agreed that the court's rulings in July 2018 in the Roofers' Pension Fund case and in July 2019 in the Carmignac and related cases will apply to this case as well. The defendants have filed answers denying liability. The plaintiffs are participating in the discovery proceedings in the Roofers' Pension Fund case and the various individual cases described above.

The BlackRock Global complaint also asserts claims under Securities Exchange Act section 10(b) (and SEC Rule 10b-5) and section 14(e) against all defendants and section 20(a) control person claims against the individual defendants largely based on the same events during the period from April 2015 through May 2017. Plaintiffs contend that the defendants provided inadequate disclosure during the tender offer period in 2015 and point to disclosures at various times during the period concerning valuation and integration of Omega, the financial guidance provided by us during that period, alleged price fixing activities with respect to six generic prescription pharmaceuticals, alleged lower performance in the generic prescription drug business during 2015 and alleged improper accounting for the Tysabri® asset. The defendants have filed answers denying liability. The plaintiffs are participating in the discovery proceedings in the Roofers' Pension Fund case and the various individual cases described above.

The Starboard Value and Opportunity C LP complaint also asserts claims under Securities Exchange Act section 10(b) (and SEC Rule 10b-5) against all defendants and section 20(a) control person claims against the individual defendants based on events related to alleged price fixing activities with respect to generic prescription drugs during periods that overlap to some extent with the period alleged in the various other cases described above. Plaintiffs contend that the defendants provided inadequate disclosure during 2016 about generic prescription drug business and those alleged matters. The lawsuit was filed on February 25, 2021; but by agreement the case was administratively terminated by the court in June 2021 pending a decision on the same defendants’ motions currently pending before the court in the Roofers' Pension Fund case described above.

The Highfields federal case complaint asserted claims under Sections 14(e) and 18 of the Securities Exchange Act against all defendants, as well as control person liability under Section 20(a) of the Securities Exchange Act against the individual defendants. As originally filed in the U.S. District Court for the District of Massachusetts, the Highfields complaint also alleged claims under the Massachusetts Unfair Business Methods

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Law (chapter 93A) and Massachusetts common law claims of tortious interference with prospective economic advantage, common law fraud, negligent misrepresentation, and unjust enrichment. The factual allegations generally were similar to the factual allegations in the Amended Complaint in the Roofers' Pension Fund case described above, except that the Highfields plaintiffs did not include allegations about alleged collusive pricing of generic prescription drugs. In March 2020, the District of Massachusetts court granted defendants’ motion and transferred the case to the U.S. District Court for the District of New Jersey so that the activities in the case could proceed in tandem with the other cases in the District of New Jersey described above. After the transfer, in June 2020, the Highfields plaintiffs voluntarily dismissed their federal lawsuit. The same Highfields plaintiffs the same day then filed a new lawsuit in Massachusetts State Court asserting the same factual allegations as in their federal lawsuit and alleging only Massachusetts state law claims under the Massachusetts Unfair Business Methods Law (chapter 93A) and Massachusetts common law claims of tortious interference with prospective economic advantage, common law fraud, negligent misrepresentation, and unjust enrichment. Defendants’ motion to dismiss was fully briefed as of late November 2020, argument occurred in early May 2021, and the motion is pending before the court.

In Israel (cases related to events in 2015-2017)

Because our shares are traded on the Tel Aviv exchange under a dual trading arrangement, we are potentially subject to securities litigation in Israel. Three cases were filed; one was voluntarily dismissed in each of 2017 and 2018 and one was stayed in 2018. We are consulting with Israeli counsel about our response to these allegations and we intend to defend this case vigorously.

On June 28, 2017, a plaintiff filed a complaint in Tel Aviv District Court styled Israel Elec. Corp. Employees’ Educ. Fund v. Perrigo Company plc, et al. The lead plaintiff seeks to represent a class of shareholders who purchased Perrigo stock on the Tel Aviv exchange during the period from April 24, 2015 through May 3, 2017 and also a claim for those that owned shares on the final day of the Mylan tender offer (November 13, 2015). The amended complaint names as defendants the Company, Ernst & Young LLP (the Company’s auditor), and 11 current or former directors and officers of Perrigo (Mses. Judy Brown, Laurie Brlas, Jacqualyn Fouse, Ellen Hoffing, and Messrs. Joe Papa, Marc Coucke, Gary Cohen, Michael Jandernoa, Gerald Kunkle, Herman Morris, and Donal O’Connor). The complaint alleges violations under U.S. securities laws of Securities Exchange Act sections 10(b) (and Rule 10b‑5) and 14(e) against all defendants and 20(a) control person liability against the 11 individuals or, in the alternative, under Israeli securities laws. In general, the allegations concern the actions taken by us and our former executives to defend against the unsolicited takeover bid by Mylan in the period from April 21, 2015 through November 13, 2015 and the allegedly inadequate disclosure concerning purported integration problems related to the Omega acquisition, alleges incorrect reporting of organic growth at the Company, alleges price fixing activities with respect to six generic prescription pharmaceuticals, and alleges improper accounting for the Tysabri® royalty stream. The plaintiff indicates an initial, preliminary class damages estimate of 2.7 billion NIS (approximately $760.0 million at 1 NIS = 0.28 cents). After the other two cases filed in Israel were voluntarily dismissed, the plaintiff in this case agreed to stay this case pending the outcome of the Roofers’ Pension Fund case in the U.S. (described above). The Israeli court approved the stay, and this case is now stayed. We intend to defend the lawsuit vigorously.

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Note 16

In the United States (cases related to Irish Tax events)

On January 3, 2019, a shareholder filed a complaint against the Company, our CEO Murray Kessler, and our former CFO Ronald Winowiecki in the U.S. District Court for the Southern District of New York (Masih v. Perrigo Company, et al.). Plaintiff purported to represent a class of shareholders for the period November 8, 2018 through December 20, 2018, inclusive. The complaint alleged violations of Securities Exchange Act section 10(b) (and Rule 10b‑5) against all defendants and section 20(a) control person liability against the individual defendants. In general the allegations contended that the Company, in its Form 10-Q filed November 8, 2018, disclosed information about an October 31, 2018 audit finding letter received from Irish tax authorities but failed to disclose enough material information about that letter until December 20, 2018, when we filed a current report on Form 8‑K about Irish tax matters. The plaintiff did not provide an estimate of class damages. The court selected lead plaintiffs and changed the name of the case to In re Perrigo Company plc Sec. Litig. The lead plaintiffs filed an amended complaint on April 12, 2019, which named the same defendants, asserted the same class period, and invoked the same Exchange Act sections. The amended complaint generally repeated the allegations of the original complaint with a few additional details and adds that the defendants also failed to timely disclose the Irish tax authorities’ Notice of Amended Assessment received on November 29, 2018. Defendants filed a motion to dismiss on May 3, 2019. On May 31, 2019, the plaintiffs filed a second amended complaint, which asserted a longer class period (March 1, 2018 through December 20, 2018) and added one additional individual defendant, former CEO Uwe Roehrhoff. In general, the second amended complaint contends that Perrigo’s disclosures about the Irish tax audit were inadequate beginning with Perrigo’s 10-K filed on March 1, 2018 through December 20, 2018 and repeats many of the allegations of the April 2019 amended complaint. The second amended complaint alleges violations of Securities Exchange Act section 10(b) (and SEC Rule 10b-5) against all defendants and section 20(a) control person liability against the three individual defendants. All defendants filed a joint motion to dismiss, and the motion was fully briefed. On January 23, 2020, the court granted the motion to dismiss in part and denied it in part, dismissing Mr. Roehrhoff as a defendant and dismissing allegations of inadequate disclosures related to the audit by Irish Revenue during the period March 2018 through October 30, 2018. The court permitted the plaintiffs to pursue their claims against us, Mr. Kessler, and Mr. Winowiecki related to disclosures after Perrigo received the October 30, 2018 audit findings letter and later events through December 20, 2018. The defendants filed answers on February 13, 2020 denying liability, and the court issued a scheduling order on March 3, 2020 that has been subsequently modified. Discovery on the remaining issues ended in early March 2021. Plaintiffs filed a motion for class certification, which was granted in September 2020. In January 2021, class plaintiffs filed a motion for leave to file a third amended complaint in an effort to revive their claim that the disclosure of the audit during the period from March 1, 2018 to October 30, 2018 was also inadequate. The court denied the motion in February 2021. Defendants filed motions for summary judgement and other post discovery motions on March 31, 2021 and plaintiffs filed cross-motions of the same type on the same day. All motions were fully briefed by late May 2021. During the week of July 11, 2021, the Court issued various opinions and orders denying some of the motions by both parties, and granting in part certain motions by plaintiffs. Defendants filed a motion for reconsideration for some of the rulings in late July, and the court ordered briefing to be completed in mid-August. The court also indicated that the parties should prepare for trial in mid-October 2021 (subject to COVID-19 developments), without setting an exact trial date. We intend to defend the lawsuit vigorously.

In Israel (case related to Irish Tax events)

On December 31, 2018, a shareholder filed an action against the Company, our CEO Murray Kessler, and our former CFO Ronald Winowiecki in Tel Aviv District Court (Baton v. Perrigo Company plc, et. al.). The case is a securities class action brought in Israel making similar factual allegations for the same period as those asserted in the In re Perrigo Company plc Sec. Litig case in New York federal court. This case alleges that persons who invested through the Tel Aviv stock exchange can assert claims under Israeli securities law that will follow the liability principles of Sections 10(b) and 20(a) of the U.S. Securities Exchange Act. The plaintiff does not provide an estimate of class damages. In 2019, the court granted two requests by Perrigo to stay the proceedings pending the resolution of proceedings in the United States. Perrigo filed a further request for a stay in February 2020, and the court granted the stay indefinitely. The plaintiff filed a motion to lift the stay then later agreed that the case should remain stayed through February 2021. In late February 2021, Perrigo filed a motion to extend the stay to mid-May 2021, and plaintiff later agreed to the request. The court extended the stay to mid-May 2021. The court later extended the stay. Defendants provided an update to the court by August 8, and the court requested plaintiff's views by August 29, 2021. We intend to defend the lawsuit vigorously.

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Note 16

Claim Arising from the Omega Acquisition

On December 16, 2016, we and Perrigo Ireland 2 brought an arbitral claim ("Claim") against Alychlo NV ("Alychlo") and Holdco I BE NV (together the "Sellers") in accordance with clause 26.2 of the Share Purchase Agreement dated November 6, 2014 ("SPA") and the rules of the Belgian Centre for Arbitration and Mediation ("CEPANI"). Our Claim relates to the accuracy and completeness of information about Omega provided by the Sellers as part of the sale process, the withholding of information by the Sellers during that process and breaches of Sellers’ warranties. We are seeking monetary damages from the Sellers. The Sellers served their respective responses to the Claim on February 20, 2017. In its response, Alychlo has asserted a counterclaim for monetary damages contending that we breached a warranty in the SPA and breached the duty of good faith in performing the SPA. Alychlo subsequently filed papers seeking permission to introduce an additional counterclaim theory of recovery related to the Irish tax issues disclosed by the Company such that if the position of the Irish tax authorities prevails, Alychlo would have further basis for its counterclaim against Perrigo. In June 2019, the Tribunal denied permission for Alychlo to introduce the additional counterclaim and dismissed certain aspects of the original Alychlo counterclaim. There can be no assurance that our Claim will be successful, and the Sellers deny liability for the Claim. To the extent that aspects of Alychlo’s counterclaim survived the Tribunal’s ruling in June 2019, we deny that Alychlo is entitled to any relief (including monetary relief). The ongoing arbitration proceedings are confidential as required by the SPA and the rules of the CEPANI.

Other Matters

Talcum Powder

The Company has been named, together with other manufacturers, in product liability lawsuits in state courts in California, Florida, Missouri, New Jersey, Louisiana and Illinois alleging that the use of body powder products containing talcum powder causes mesothelioma and lung cancer due to the presence of asbestos. All but one of these cases involve legacy talcum powder products that have not been manufactured by the Company since 1999. One of the pending actions involves a current prescription product that contains talc as an excipient. As of July 13, 2021, the Company is currently named in 44 individual lawsuits seeking compensatory and punitive damages and has accepted a tender for a portion of the defense costs and liability from a retailer for one additional matter. The Company has several defenses and intends to aggressively defend these lawsuits. Trials for these lawsuits are currently scheduled throughout 2021, 2022 and 2023, with the earliest to begin in September 2021.

Ranitidine

After regulatory bodies announced worldwide that ranitidine may potentially contain N-nitrosodimethylamine ("NDMA"), a known environmental contaminant, the Company promptly began testing its externally-sourced ranitidine API and ranitidine-based products. On October 8, 2019, the Company halted shipments of the product based upon preliminary results and on October 23, 2019, the Company made the decision to conduct a voluntary retail market withdrawal.

In February 2020, the resulting actions involving Zantac® and other ranitidine products were transferred for coordinated pretrial proceedings to a Multi-District Litigation (In re Zantac®/Ranitidine Products Liability Litigation MDL No. 2924) in the U.S. District Court for the Southern District of Florida. After the Company successfully moved to dismiss the first set of Master Complaints in the MDL, it now includes three: 1) an Amended Master Personal Injury Complaint; 2) a Consolidated Amended Consumer Economic Loss Class Action Complaint; and 3) a Consolidated Medical Monitoring Class Action Complaint. All three name the Company. Plaintiffs appealed one of the original Master Complaints, the Third-Party Payor Complaint, and two individual plaintiffs appealed their individual personal injury claims on limited grounds. The Company is not named in the appeals.

As of July 13, 2021, the Company has been named in two hundred forty-five (245) of the MDL’s consolidated personal injury lawsuits tied to various federal courts alleging that plaintiffs developed various types of cancers or are placed at higher risk of developing cancer as a result of ingesting products containing ranitidine. The Company is named in these lawsuits with manufacturers of the national brand Zantac® and other manufacturers of ranitidine products, as well as distributors, repackagers, and/or retailers. Plaintiffs seek compensatory and punitive damages, and in some instances seek applicable remedies under state consumer protection laws.

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Note 16

The Company has also been named in a Complaint brought by the New Mexico Attorney General based on the following theories: violation of a New Mexico public nuisance statute, NMSA 30-8-1 to -14; common law nuisance; and negligence and gross negligence. The Company is named in this lawsuit with manufacturers of the national brand Zantac® and other manufacturers of ranitidine products and/or retailers. Brand name manufactures named in the lawsuit also face claims under the state’s Unfair Practices & False Advertising acts. Likewise, the Company has also been named in a Complaint brought by the Mayor and City Council of Baltimore, along with manufacturers of the national brand Zantac® and other manufacturers of ranitidine products and/or retailers. This action brings claims under the Maryland Consumer Protection Act against the brand name defendants only, as well as public nuisance and negligence for the remaining defendants. The Company was originally able to consolidate the New Mexico and Baltimore Actions to the MDL, however both actions were recently remanded to state court. The Company plans to file motions to dismiss in the New Mexico and Baltimore actions in the near future, and will continue to vigorously defend each of these lawsuits.

Some of the Company’s retailer customers are seeking indemnity from the Company for a portion of their defense costs and liability relating to these cases.

On June 30, 2021, the Court dismissed all claims against the retail and distributor defendants with prejudice, thereby reducing the Company’s potential for exposure and liability related to possible indemnification. On July 8, 2021, the Court dismissed all claims against the Company with prejudice. The Company believes an appeal of these dismissal orders to the U.S. Court of Appeals for the 11th Circuit is likely, as are possible state level claims related to the theories advanced in the MDL litigation. The Company will continue to vigorously defend each of these lawsuits.

Acetaminophen

The Company has received requests for indemnification and defense of several consumer fraud claims involving its store brand infants’ and children’s acetaminophen products. In September 2020, the Company was directly named as a defendant in one suit filed in the Central District of California. The Company was recently named in a cross complaint by a retailer for contractual indemnity in California Superior Court, Alameda County. The Company has also received 16 different claims for indemnification or defense from 10 different retailers for lawsuits filed in California, Illinois, Florida and Pennsylvania, with nationwide class action allegations.

The Plaintiffs generally allege that the children’s and infants’ acetaminophen products have identical drug concentration amounts, yet the infants’ product costs more than the children’s product and consumers have been misled into purchasing the more expensive product. The Company will aggressively defend the suits in which it is named and is continuing to assess whether, or to what extent, the Company may contribute in the lawsuits filed against its retail customers.

Guarantee Liability Related to The Israel API Sale

During the year ended December 31, 2017, we completed the sale of our Israel API business to SK Capital, resulting in a guarantee liability of $13.8 million, classified as a Level 3 liability within the fair value hierarchy. Pursuant to the agreement, we will be reimbursed for tax receivables for tax years prior to closing and will need to reimburse SK Capital for the settlement of any uncertain tax liability positions for tax years prior to closing. In addition, after closing and going forward, the Israel API business will be assessed by and liable to the ITA for any audit findings. We are no longer the primary obligor on the liabilities transferred to SK Capital, but we have provided a guarantee on certain obligations. During the three months ended July 3, 2021, we paid $12.5 million to resolve the tax liability indemnity for the tax year ended December 31, 2017 (refer to Note 15). At July 3, 2021 and December 31, 2020, the remaining guarantee liability was $0.6 million and $13.2 million, respectively.

Contingencies Accruals

As a result of the matters discussed in this Note, the Company has established a loss accrual for litigation contingencies where we believe a loss to be probable and for which an amount of loss can be reasonably estimated. However, we cannot determine a reasonable estimate of the maximum possible loss or range of loss for these matters given that they are at various stages of the litigation process and each case is subject to inherent uncertainties of litigation. At July 3, 2021, the loss accrual for litigation contingencies reflected on the balance sheet in Other accrued liabilities was approximately $65.0 million. The Company also recorded an insurance recovery

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Note 16

receivable reflected on the balance sheet in Prepaid expenses and other current assets of approximately $56.2 million related to these litigation contingencies because it believes such amount is recoverable based on communications with its insurers to date; however, the Company may erode this insurance receivable as it incurs defense costs associated with defending this matter. The Company’s management believes these accruals for contingencies are reasonable and sufficient based upon information currently available to management; however, there can be no assurance that final costs related to these contingencies will not exceed current estimates or that all of the final costs related to these contingencies will be covered by insurance. (See "Insurance Coverage Litigation," below.) In addition, we have other litigation matters pending for which we have not recorded any accruals because our potential liability for those matters is not probable or cannot be reasonably estimated based on currently available information. For those matters where we have not recorded an accrual but a loss is reasonably possible, we cannot determine a reasonable estimate of the maximum possible loss or range of loss for these matters given that they are at various stages of the litigation process and each case is subject to the inherent uncertainties of litigation.

Insurance Coverage Litigation

In May 2021 insurers on multiple policies of D&O insurance filed an action in the High Court in Dublin against the Company and multiple current and former directors and officers of the Company seeking declaratory judgments on certain coverage issues. Those coverage issues include claims that policies for periods beginning in December 2015 and December 2016, respectively, do not have to provide coverage for the securities actions described above pending in the District of New Jersey or in Massachusetts state court concerning the events of 2015-2017. The policy for the period beginning December 2014 is currently providing coverage for those matters, and the litigation would not affect that existing coverage. However, if the plaintiffs are successful, the total amount of insurance coverage available to defend such lawsuits and to satisfy any judgment or settlement costs thereunder would be limited to one policy period. The insurers’ lawsuit also challenges coverage for Krueger derivatively on behalf of nominal defendant Perrigo Company plc v. Alford et al., a prior derivative action filed in the District of New Jersey that was dismissed in August 2020, and for the counterclaims brought in the Omega arbitration proceedings. We intend to defend the lawsuit vigorously.

NOTE 17 – RESTRUCTURING CHARGES

We periodically take action to reduce redundant expenses and improve operating efficiencies. Restructuring activity includes severance, lease exit costs, and related consulting fees. The following reflects our restructuring activity (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Beginning balance	$	6.2	$	16.0	$	9.1	$	19.5
Additional charges	9.0		0.7		10.7		0.7
Payments	(5.1)		(7.3)		(9.5)		(10.8)
Non-cash adjustments	0.1		—		(0.1)		—
Ending balance	$	10.2	$	9.4	$	10.2	$	9.4

The charges incurred during the three and six months ended July 3, 2021 and June 27, 2020 were primarily associated with actions taken to streamline the organization.

There were no other material restructuring programs for the three and six months ended July 3, 2021 and June 27, 2020. All charges are recorded in Restructuring expense on the Condensed Consolidated Statements of Operations. The remaining $10.2 million liability for employee severance benefits is expected to be paid within the next year.

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Perrigo Company plc - Item 2

Note 18

NOTE 18 – SEGMENT INFORMATION

Our segments reflect the way in which our management makes operating decisions, allocates resources, and manages the growth and profitability of the Company. As discussed in Note 8, as of March 1, 2021, the financial results and assets and liabilities of the RX business are classified as discontinued operations in the Condensed Consolidated Statements of Operations and Condensed Consolidated Balance Sheets. As discussed in Note 9, as of July 3, 2021, the assets and liabilities of the Latin American businesses were classified as held for sale. The RX business and Latin American businesses assets held-for-sale are included below in the summary of total assets.

The tables below show select financial measures by reporting segment (in millions):

	Total Assets
	July 3, 2021		December 31, 2020
CSCA	$	4,417.1	$	4,585.1
CSCI	4,723.9		4,872.4
Held for sale	2,089.3		2,030.9
Total	$	11,230.3	$	11,488.4

	Three Months Ended
	July 3, 2021						June 27, 2020
	Net Sales		Operating Income (Loss)		Intangible Asset Amortization		Net Sales		Operating Income (Loss)		Intangible Asset Amortization
CSCA	$	622.3	$	(72.0)	$	12.9	$	627.7	$	104.6	$	13.2
CSCI	358.8		1.3		40.5		321.1		10.5		38.4
Unallocated	—		(55.2)		—		—		(52.4)		—
Continuing Operations Total	$	981.1	$	(125.9)	$	53.4	$	948.8	$	62.7	$	51.6

	Six Months Ended
	July 3, 2021						June 27, 2020
	Net Sales		Operating Income (Loss)		Intangible Asset Amortization		Net Sales		Operating Income (Loss)		Intangible Asset Amortization
CSCA	$	1,262.8	$	23.6	$	25.8	$	1,328.2	$	226.7	$	27.5
CSCI	728.3		18.8		80.8		703.8		35.6		76.7
Unallocated	—		(117.0)		—		—		(113.2)		—
Continuing Operations Total	$	1,991.1	$	(74.6)	$	106.6	$	2,032.0	$	149.1	$	104.2

NOTE 19 – SUBSEQUENT EVENTS

RX Business

On July 6, 2021, we completed the sale of the RX Business to Altaris for aggregate consideration of $1.55 billion, which we estimate will result in an immaterial pre-tax gain during the three months ending October 2, 2021, subject to final settlement of the sale proceeds. The final purchase price and gain or loss on the sale are subject to customary adjustments for cash, debt, working capital and transaction expenses, along with computation of income tax on the sale. We expect to finalize these items by the fourth quarter of 2021.

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Perrigo Company plc - Item 2

Executive Overview

ITEM 2.        MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

EXECUTIVE OVERVIEW

This Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the financial statements included in this Form 10-Q and our Form 10-K for the year ended December 31, 2020 (the “2020 Form 10-K”). These historical financial statements may not be indicative of our future performance. This discussion contains a number of forward-looking statements, all of which are based on our current expectations and could be affected by the uncertainties and risks referred to under “Risk Factors” in Item 1A of our 2020 Form 10-K and Part II. Item 1A of this Form 10-Q.

Perrigo Company plc was incorporated under the laws of Ireland on June 28, 2013 and became the successor registrant of Perrigo Company, a Michigan corporation, on December 18, 2013 in connection with the acquisition of Elan Corporation, plc ("Elan"). Unless the context requires otherwise, the terms "Perrigo," the "Company," "we," "our," "us," and similar pronouns used herein refer to Perrigo Company plc, its subsidiaries, and all predecessors of Perrigo Company plc and its subsidiaries.

Our vision is to make lives better by bringing Quality, Affordable Self-Care Products that consumers trust everywhere they are sold. We are a leading provider of over-the-counter ("OTC") health and wellness solutions that enhance individual well-being by empowering consumers to proactively prevent or treat conditions that can be self-managed.

On March 1, 2021, we announced a definitive agreement to sell our RX business to Altaris. On July 6, 2021, we completed the sale of the RX business for aggregate consideration of $1.55 billion, subject to customary adjustments for cash, debt, working capital and certain transaction expenses. The consideration includes approximately $53.0 million of reimbursements which Altaris will be required to deliver in cash to Perrigo pursuant to the terms of the Agreement.

The sale of the RX business establishes Perrigo as a pure-play consumer self-care company, and was an essential milestone in our transformation plan. The financial results of the RX business, which were previously reported as part of our RX segment, have been classified as discontinued operations in the Condensed Consolidated Statements of Operations, and its assets and liabilities have been classified as held for sale for all periods presented. Unless otherwise noted, amounts and disclosures throughout this Management’s Discussion and Analysis relate to our continuing operations. Refer to Item 1. Note 8 for additional information regarding discontinued operations.

Our Segments

Our reporting and operating segments are as follows:

•Consumer Self-Care Americas ("CSCA") comprises our consumer self-care business (OTC, infant formula, and oral self-care categories, and contract manufacturing) in the U.S., Mexico and Canada.

•Consumer Self-Care International ("CSCI") comprises our consumer self-care business primarily branded in Europe and Australia, our store brand business in the United Kingdom and parts of Europe and Asia, and our liquid licensed products business in the United Kingdom until it was disposed on June 19, 2020.

Our segments reflect the way in which our management makes operating decisions, allocates resources, and manages the growth and profitability of the Company. Financial information related to our business segments and geographic locations can be found in Item 1. Note 2 and Note 18. For results by segment, see "Segment Results" below.

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Executive Overview

Highlights

Operating Trends

The self-care markets in which we compete have been negatively impacted over the past nine months by channel dynamics, sales mix, input costs, COVID-19 related consumer behavior and a dramatic reduction in cough, cold and flu illnesses. In the second quarter of 2021, we were encouraged to see a sharp rebound in consumer takeaway in the US and Europe across almost all categories, as these markets began to remove restrictions and reopen and the incidences of cough and cold related illnesses begin to increase. Despite increased consumer purchases, net sales for the second quarter of 2021 significantly lagged this consumer takeaway, which we attribute to year over year reductions in customer inventories and unfavorable channel shifting. Notably, we saw net sales improve each month throughout the second quarter, ultimately improving net sales over last year’s pandemic-related pantry load in the second quarter of 2020. While we believe this trend will continue, further US retailer inventory adjustments or the trajectory of the COVID-19 pandemic, as discussed below, could negatively affect consumer purchases in the jurisdictions in which we operate.

Higher input costs were offset by procurement actions and price increases initiated during the second quarter of 2021. We anticipate a continuation of these trends going forward though some factors may increase or decrease more than others. In CSCI, we deliberately reinstated advertising and promotion spending to pre-COVID levels during the second quarter of 2021. In the prior year quarter, management re-allocated such spending from the second quarter to the fourth quarter in response to consumer behavior surrounding COVID-19. We do not expect the same level of quarterly re-allocation in 2021.

Sale of RX business

On July 6, 2021, we completed the sale of the RX business for aggregate consideration of $1.55 billion, subject to customary adjustments for cash, debt, working capital and certain transaction expenses. The consideration includes approximately $53.0 million of reimbursements which Altaris will be required to deliver in cash to Perrigo pursuant to the terms of the Agreement. The sale of the RX business establishes Perrigo as a pure-play consumer self-care company, and was an essential milestone in our transformation plan.

Impact of COVID-19 Pandemic

We have been impacted by the COVID-19 global pandemic and the responses by government entities to combat the virus. We currently continue to operate in all our jurisdictions and are complying with the rules and guidelines prescribed in each jurisdiction. We continue to closely monitor the impact of COVID-19 on all aspects of our business in all our global locations. Our first priority has been, and will continue to be, the safety of our employees who continue to come to work and are dedicated to keeping our essential products flowing into the market. We have taken extra precautions at our facilities, to help ensure the health and safety of our employees, that are in line with guidance from global and local health authorities. Among other precautions implemented, we have generally restricted access to our production facilities worldwide to essential employees only and permitted a limited number of nonessential employees into other facilities with a strict approval process, implemented a multi-step pre-screening access process before an employee can enter a facility, communicated regularly with employees and provided education and implemented controls related to physical distancing and hygiene measures, implemented remote work arrangements where appropriate, restricted business travel, and prioritized production of essential products for several months following the initial outbreak. To date, these arrangements have not materially affected our ability to maintain our business operations, including the operation of financial reporting systems, internal control over financial reporting, and disclosure controls and procedures.

Both the outbreak of the disease and the actions to slow its spread have had an adverse impact on our operations by, among other things, increasing absenteeism, affecting the cost and supply of raw materials and third party supplied finished goods, and preventing many of our employees from coming to work. We have responded to such impacts by, among other things, implementing protocols to protect the health of factory workers, adjusting production schedules, and seeking alternate suppliers where available, and so far, most of our facilities have continued to produce at high levels despite these challenges. Many jurisdictions are now relaxing COVID-19 related restrictions, however, a number of those jurisdictions have experienced new surges in COVID-19 cases, including the more contagious Delta variant of the virus and in some cases have begun implementing new or renewed restrictions. In addition, as conditions worldwide continue to evolve, uncertainty remains about the timing of widespread availability and acceptance of vaccines and the efficacy of current vaccines against evolving strains or

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Executive Overview

variants of the virus. As such, if the pandemic continues or intensifies, it is possible that these or other challenges may begin having a larger impact on our operations. Additionally, concerns over the economic impact of COVID-19 have caused volatility in financial and other capital markets, which has adversely impacted, and may continue to adversely impact our stock price and our ability to access capital markets. The situation surrounding COVID-19 remains fluid, and we are actively managing our response and assessing potential impacts to our financial condition, supply chains and other operations, employees, results of operations, consumer demand for our products, and our ability to access capital. The magnitude of any such adverse impact cannot currently be determined due to a number of uncertainties surrounding COVID-19.

During the six months ended July 3, 2021, our segments continued to experience a decline in net sales for cough and cold products in our upper respiratory and pain and sleep aid categories, due to the very low incidence of cough and cold related illness this year. We believe the low incidence of cough and cold related illness is due to social distancing measures and mask mandates implemented to combat spreading of the COVID-19 virus. As many of the markets that we operate in began to relax restrictions and reopen, we saw consumer behavior begin to return to normal, and the incidences of cough and cold related illnesses begin to increase. This resulted in rebounding consumer takeaway in the second quarter, including for cough and cold related products, although factory shipments have not yet caught up to consumption. While these current trends suggest that the volatility in consumer behavior during the pandemic is improving, the emergence and spread of new disease variants or additional outbreaks in these or other jurisdictions could result in new restrictions or cause these trends to change, slow or reverse.

Also, during the six months ended July 3, 2021, we incurred additional operating costs related to COVID-19, due primarily to increased material costs and increased costs driven by pandemic-related global supply chain disruptions. These costs are in addition to the costs related to the ongoing precautions implemented in 2020 to keep our employees safe as well as known increased material costs carried over from 2020. We expect these costs will continue into early calendar year 2022. Given our financial strength, we expect to continue to maintain sufficient liquidity as we continue to manage through the pandemic.

Moving forward, it remains uncertain if the consumer and customer behavior surrounding COVID-19 that has impacted net sales will continue to normalize or change and if our incremental operating costs will continue or change. Any change in these trends will likely depend on the duration and severity of the COVID-19 pandemic, including the emergence of new strains of the virus, including the Delta variant, that are more contagious or harmful, each individual country's evolving response to the pandemic, as well as the availability and efficacy of the COVID-19 vaccines.

RESULTS OF OPERATIONS

CONSOLIDATED

Consolidated Financial Results

Three Month Comparison

	Three Months Ended
(in millions, except percentages)	July 3, 2021			June 27, 2020
Net sales	$	981.1		$	948.8
Gross profit	$	349.0		$	347.2
Gross profit %	35.6		%	36.6		%
Operating income	$	(125.9)		$	62.7
Operating income %	(12.8)		%	6.6		%

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Perrigo Company plc - Item 2

Consolidated

* Total net sales by geography is derived from the location of the entity that sells to a third party.

Three Months Ended July 3, 2021 vs. Three Months Ended June 27, 2020

Net sales increased $32.3 million, or 3.4%, due to:

•$4.3 million, or 0.5%, net growth in the base business portfolio despite a $21.0 million decrease in sales of cough and cold products due to the low incidence of related illness this year, as well as an inventory reduction at our retail customers in the US compared to the prior year quarter; and

•$28.0 million net increase due primarily to:

◦$35.4 million increase from favorable foreign currency translation; and

◦$7.0 million increase due to the acquisition of three Eastern European Brands in October 2020; partially offset by

◦$14.4 million decrease due to our now-divested Rosemont pharmaceuticals business previously included in our CSCI segment.

Operating income decreased $188.6 million, or 300.8%, due primarily to:

•$1.8 million increase in gross profit due primarily to the increase in net sales as described above, partially offset by unfavorable plant overhead absorption due to lower production volumes and by higher freight costs. Gross profit as a percentage of net sales decreased 100 basis points due to these same factors as well as unfavorable product mix; partially offset by

•$190.4 million increase in operating expenses due primarily to:

◦$21.0 million increase in selling, distribution, and administration expenses due to:

▪$20.5 million increase in selling, advertising and promotion expenses due primarily to the deliberate reinstatement of brand and marketing investments mainly in our CSCI segment to pre-COVID-19 levels and unfavorable foreign currency translation; and

▪$4.3 million increase in distribution expenses due primarily to increased labor and warehouse costs; partially offset by

▪$3.8 million decrease in administration expenses due primarily to Project Momentum savings and higher indirect costs in the prior year period relating to the RX business, partially offset by a reduction in an insurance recovery receivable related to litigation contingencies; and

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Perrigo Company plc - Item 2

Consolidated

◦$166.9 million increase in other operating expenses due to:

▪$158.6 million of impairment charges on goodwill and held for sale assets related to our Mexico and Brazil-based OTC businesses (the “Latin American businesses”); and

▪$8.3 million increase in restructuring expenses primarily associated with actions taken to streamline the organization.

Six Month Comparison

	Six Months Ended
(in millions, except percentages)	July 3, 2021			June 27, 2020
Net sales	$	1,991.1		$	2,032.0
Gross profit	$	717.4		$	740.9
Gross profit %	36.0		%	36.5		%
Operating income	$	(74.6)		$	149.1
Operating income %	(3.7)		%	7.3		%

* Total net sales by geography is derived from the location of the entity that sells to a third party.

Six Months Ended July 3, 2021 vs. Six Months Ended June 27, 2020

Net sales decreased $40.9 million, or 2.0% due to:

•$111.9 million, or 5.6%, net decrease due primarily to a decline of $89.1 million in sales of cough and cold products due to the low incidence of related illness this year. The remaining decrease of $22.8 million was due primarily to comparison to the pandemic-related pantry load benefit in the prior year and by inventory reductions at our retail customers in the US compared to the prior year. These declines were partially offset by incremental new product sales.

•$71.0 million increase due primarily to:

◦$60.6 million increase from favorable foreign currency translation; and

◦$39.1 million increase from our acquisitions of the three Eastern European Brands in October 2020 and Dr. Fresh in April 2020; partially offset by

◦$28.7 million decrease due to our now-divested Rosemont pharmaceuticals business previously included in our CSCI segment.

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Consolidated

Operating income decreased $223.7 million, or 150.0%, due to:

•$23.5 million decrease in gross profit due primarily to the decrease in net sales as described above, unfavorable plant overhead absorption due to lower production volumes in OTC, and by higher freight costs. Gross profit as a percentage of net sales decreased 50 basis points due to these same factors as well as unfavorable product mix.

•$200.2 million increase in operating expenses due primarily to:

◦$31.6 million increase in selling, distribution, R&D, and administration expenses due primarily to:

▪$16.3 million increase in selling, advertising and promotion expenses due primarily to unfavorable foreign currency translation and higher brand and marketing investments in our CSCA segment, partially offset by a reduction in advertising and promotion expenses in our CSCI segment;

▪$5.8 million increase in distribution expenses due primarily to increased labor and warehouse costs;

▪$5.8 million increase in research and development expenses for continued innovation efforts, partially offset by the absence of expenses from the now-divested Rosemont pharmaceuticals business; and

▪$3.7 million increase in administration expenses due primarily to a reduction in an insurance recovery receivable related to litigation contingencies, an increase in employee related costs, and unfavorable foreign currency translation, partially offset by costs savings reductions from Project Momentum and higher indirect costs in the prior year period relating to the RX business; and

◦$168.6 million increase in other operating expenses due to:

▪$158.6 million of impairment charges on goodwill and held for sale assets related to the Latin American businesses; and

▪$10.0 million increase in restructuring expenses primarily associated with actions taken to streamline the organization.

Recent Developments

Irish Revenue Notice of Amended Assessment

As described in more detail in Item 1. Note 15, on November 29, 2018, Irish Revenue issued a Notice of Amended Assessment (“NoA”) for the tax year ended December 31, 2013, in the amount of €1,643 million, and claiming tax payable in the amount of €1,636 million, not including any interest or applicable penalties. The NoA relates to the tax treatment of the 2013 sale of the Tysabri® intellectual property and related assets to Biogen Idec by Elan Pharma. We strongly believe that Elan Pharma’s tax position is correct and would ultimately be confirmed through judicial process. However, in light of the risks and delays inherent in any litigation, representatives of Perrigo met with representatives of Irish Revenue on March 18, 2021 and April 14, 2021, to explore whether there may be a path forward toward resolving the dispute. On April 26, 2021, Perrigo, through its tax adviser, made a without prejudice written offer of settlement to Irish Revenue detailing a possible framework for such a resolution, which applied an alternative basis of taxation than the respective positions taken by Irish Revenue in the NoA and by Elan Pharma in its tax returns. On May 31, 2021, Irish Revenue issued a formal response to Perrigo's tax adviser indicating that the written settlement offer would not be accepted as presented. While that offer was not accepted, the Company’s representatives continue to meet and correspond with Irish Revenue.

On July 9, 2021, Irish Revenue issued a letter acknowledging that not all relevant facts were known to them when they issued the NoA in 2018 and, accordingly, would not object if the Appeal Commissioner were to make certain adjustments reducing Irish Revenue’s original assessment. Such adjustments would reflect contingent royalty payments that were never received by Elan Pharma, deductions for acquisition and development costs incurred, and allowable losses and reliefs, and would, if allowed, result in an aggregate reduction of more than €660.0 million from the income taxes claimed in the NoA as issued. The reduced claim is not a settlement proposal

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Consolidated

or compromise by Irish Revenue, but rather a confirmation that Irish Revenue would not object to certain adjustments to the underlying assessment given facts now known to Irish Revenue that were not known to Irish Revenue when they issued the NoA in 2018. Accordingly, Perrigo believes that the maximum amount of income tax claims in dispute is now reduced to less than €1.0 billion, not including any interest or penalties, if applicable.

Perrigo anticipates further discussions prior to the TAC hearing in November 2021. There can be no assurances that any settlement is possible on terms acceptable to Perrigo. Unless and until a final settlement is reached, Elan Pharma will vigorously pursue its tax appeal before the TAC, concurrently with any settlement discussions that may occur. No payment of any additional tax will be required unless and until required by a settlement or other final determination.

Internal Revenue Service Audits of Perrigo Company, a U.S. Subsidiary

As described in more detail in Item 1. Note 15, Perrigo Company, our U.S. subsidiary ("Perrigo U.S."), is engaged in a series of tax disputes in the U.S. relating primarily to transfer pricing adjustments including income in connection with the purchase, distribution, and sale of store-brand OTC pharmaceutical products in the United States, including the heartburn medication omeprazole. The previously re-scheduled trial of the refund case relating to the dispute of the amount of taxable income on Omeprazole sales was held during the period May 25, 2021 to June 7, 2021 in the United States District Court for the Western District of Michigan. Post-trial briefing is scheduled to be completed by late September 2021, when the case will be fully submitted for the court’s decision.

On May 7, 2020, we received final Notices of Proposed Adjustment ("NOPA") from the IRS regarding the deductibility of interest related to the IRS audit of Perrigo U.S. for the years ended June 28, 2014 and June 27, 2015. The NOPA capped the interest rate on the debts for U.S. federal tax purposes at 130.0% of the Applicable Federal Rate (a blended rate reduction of 4.0% per annum) on the stated ground that the loans were not negotiated on an arms’-length basis. On May 3, 2021, the IRS notified us that it will no longer pursue the 130% of AFR position as indicated in the NOPA due to a change in IRS policy. The new proposed adjustment, if any, will be provided by the IRS in its rebuttal to our Protest which we filed on February 26, 2021.

Internal Revenue Service Audit of Athena Neurosciences, Inc., a U.S. Subsidiary

On April 26, 2019, we received a revised NOPA from the IRS regarding transfer pricing positions related to the IRS audit of Athena for the years ended December 31, 2011, December 31, 2012 and December 31, 2013. Our request for Competent Authority Assistance with the IRS, which we made on April 14, 2020, was accepted. An opening conference with the IRS was held on May 6, 2021, and an opening conference with Irish Revenue was held on July 23, 2021 (refer to Item 1. Note 15).

Israeli Notice of Assessment

On December 29, 2020, we received a Stage A assessment from the Israeli Tax Authority for the tax years ended December 31, 2015 through December 31, 2017 in the amount of $63.8 million relating to attribution of intangible income to Israel, income qualifying for a lower preferential rate of tax, exemption from capital gains tax, and deduction of certain settlement payments. We timely filed our protest on March 11, 2021 to move the matter to Stage B of the assessment process. Through negotiations with the ITA, we resolved the audit for the tax year ended June 27, 2015 through tax year ended December 31, 2019, by agreeing to add tax year ended December 31, 2018 and tax year ended December 31, 2019 to the audit to reach an agreeable resolution to provide certainty for these additional periods. The agreement with the ITA required us to pay $19.0 million, after offset of refunds of $17.2 million, for the five taxable years. In addition, we paid $12.5 million to resolve a tax liability indemnity for the tax year ended December 31, 2017 relating to Perrigo API Ltd, which we disposed of in December 2017 (refer to Item 1. Note 15).

CONSUMER SELF-CARE AMERICAS

Recent Trends and Developments

•During the first half of 2021, net sales of cough and cold products decreased as a result of the very low incidence of cough and cold related illness. We believe the very low incidence of cough and cold related illness is attributed to social distancing and mask mandates put in place to combat the spread of COVID-19.

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CSCA

However, based on increased consumer takeaway at our retail customers, starting in May, we expect normalizing consumer purchasing routines are expected in the second half of 2021, depending on the trajectory of the COVID-19 pandemic (refer to "Impact of COVID-19 Pandemic" above).

•On May 18, 2021, we announced a definitive agreement to sell our Latin American businesses to Advent International. This transaction is part of our margin improvement program and Project Momentum cost savings initiative and is expected to close in the second half of 2021. We determined that the carrying value of these businesses exceeded their fair value less cost to sell, resulting in an impairment charge of $158.6 million allocated to goodwill and assets held for sale (refer to Item 1. Note 9).

Segment Financial Results

Three Month Comparison

	Three Months Ended
(in millions, except percentages)	July 3, 2021			June 27, 2020
Net sales	$	622.3		$	627.7
Gross profit	$	187.3		$	197.9
Gross profit %	30.1		%	31.5		%
Operating income	$	(72.0)		$	104.6
Operating income %	(11.6)		%	16.7		%

Three Months Ended July 3, 2021 vs. Three Months Ended June 27, 2020

Net sales decreased $5.4 million, or 0.9%, due to:

•$8.9 million, or 1.4%, net decrease due primarily to:

◦$31.9 million decrease in OTC due primarily to a decline of $17.2 million in sales of cough and cold products from the low incidence of related illness this year, which impacted the upper respiratory and pain and sleep aids categories, as well as inventory reductions at our retail customers compared to the prior year period. These decreases were partially offset by incremental new product sales, including the store brand version of diclofenac, and growth in the skincare and personal hygiene category, due primarily to higher demand for the minoxidil franchise.

◦Net sales in our oral self-care category increased $11.3 million due primarily to a rebound in in-store consumer demand for both branded and store brand products compared to the prior year, which were negatively impacted by the pandemic.

◦Nutrition net sales increased $9.2 million due primarily to higher net sales in oral electrolyte solutions, an increase in infant formula contract manufacturing, and the incremental benefit of new product sales.

•$3.5 million increase due to favorable Mexican peso foreign currency translation.

Operating income decreased $176.6 million, or 168.8%, due primarily to:

•$10.6 million decrease in gross profit due primarily to unfavorable plant overhead absorption from lower production volumes in OTC, higher freight costs, higher input costs on certain products, and the decrease in net sales as described above. Gross profit as a percentage of net sales decreased 140 basis points due primarily to unfavorable plant overhead absorption and the higher freight and input costs; and

•$166.0 million increase in operating expenses due primarily to:

◦$4.4 million increase in distribution, R&D, selling, and administration expenses due primarily to:

▪$4.5 million increase in distribution costs due primarily to increased labor and warehouse costs; and

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CSCA

▪$3.1 million increase in research and development expenses, partially for a new drug application filing fee; partially offset by

▪$3.2 million decrease in selling and administration expenses due primarily to a decrease in employee related expenses, partially offset by higher brand and marketing investments; and

◦$161.6 million increase in other operating expenses due to:

▪$158.6 million of impairment charges on goodwill and held for sale assets related to the Latin American businesses; and

▪$3.0 million increase in restructuring costs related primarily to actions taken to streamline the organization and business integrations.

Six Month Comparison

	Six Months Ended
(in millions, except percentages)	July 3, 2021			June 27, 2020
Net sales	$	1,262.8		$	1,328.2
Gross profit	$	381.8		$	411.7
Gross profit %	30.2		%	31.0		%
Operating income	$	23.6		$	226.7
Operating income %	1.9		%	17.1		%

Six Months Ended July 3, 2021 vs. Six Months Ended June 27, 2020

Net sales decreased $65.4 million, or 4.9%, due to:

•$91.6 million, or 6.9%, net decrease due primarily to:

◦$103.8 million decrease in OTC due primarily to a decline of $52.2 million in sales of cough and cold products from the low incidence of related illness this year, which impacted the upper respiratory and pain and sleep aids categories. Additional decreases were due primarily to the comparison to the pandemic-related pantry load benefit in the prior year, inventory reductions at our retail customers compared to the prior year, and discontinued products. These decreases were partially offset by incremental new product sales, including the store brand version of diclofenac, and growth in the skincare and personal hygiene category, due primarily to higher demand for the minoxidil franchise.

◦In the oral self-care category, net sales increased $6.0 million due primarily to incremental new product sales and a rebound in in-store consumer demand compared to the prior year, which was negatively impacted by the pandemic.

◦Nutrition net sales increased slightly due primarily to growth in infant formula contract manufacturing, higher net sales in oral electrolyte solutions, and incremental new product sales. These factors were mostly offset by inventory reductions at our retail customers compared to the prior year.

•$26.2 million increase due to:

◦$23.8 million increase from our acquisition of Dr. Fresh in April 2020; and

◦$2.4 million increase from favorable Mexican peso foreign currency translation.

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CSCA

Operating income decreased $203.1 million, or 89.6%, due to:

•$29.9 million decrease in gross profit due primarily to unfavorable plant overhead absorption as a result of lower OTC production volumes, higher freight costs, higher input costs on certain products, and the decrease in net sales as described above. Gross profit as a percentage of net sales decreased 80 basis points due primarily to unfavorable plant overhead absorption and the higher freight and input costs; and

•$173.2 million increase in operating expenses due primarily to:

◦$11.2 million increase in distribution, R&D, selling, and administration expenses due to:

▪$5.6 million increase in distribution costs due primarily to increased labor and warehouse costs;

▪$4.8 million increase in operating expenses due to the inclusion of Dr. Fresh expenses; and

▪$4.7 million increase in R&D expenses, partially for a new drug application filing fee; partially offset by

▪$3.9 million decrease in selling and administration expenses due primarily to a decrease in employee related expenses, partially offset by higher brand and marketing investments; and

◦$162.0 million increase in other operating expenses due to:

▪$158.6 million of impairment charges on goodwill and held for sale assets related to the Latin American businesses; and

▪$3.4 million increase in restructuring costs related primarily with actions taken to streamline the organization and business integrations.

CONSUMER SELF-CARE INTERNATIONAL

Recent Trends and Developments

During the first half of 2021, net sales of cough and cold products decreased as a result of the very low incidence of cough and cold related illness this year. We believe the very low incidence of cough and cold related illness is attributed to social distancing and mask mandates put in place to combat the spread of COVID-19. However, increased consumer takeaway at our retail customers, starting in May, suggests normalizing consumer purchasing routines are expected in the second half of 2021 depending on the trajectory of the COVID-19 pandemic (refer to "Impact of COVID-19 Pandemic" above).

Segment Financial Results

Three Month Comparison

	Three Months Ended
(in millions, except percentages)	July 3, 2021			June 27, 2020
Net sales	$	358.8		$	321.1
Gross profit	$	161.7		$	149.3
Gross profit %	45.1		%	46.5		%
Operating income	$	1.3		$	10.5
Operating income %	0.4		%	3.3		%

Three Months Ended July 3, 2021 vs. Three Months Ended June 27, 2020

Net sales increased $37.7 million, or 11.7%, due to:

•$13.2 million, or 4.3%, net increase due primarily to incremental new product sales, including XLS Medical

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CSCI

Forte 5 sticks in the healthy lifestyle category, Probify probiotics brand in the VMS category, and the launch of Plackers® into new markets in the oral self-care category. Additional increases were due primarily to higher net sales in the U.K. store brand business. These increases were partially offset by lower demand for anti-parasite products within the skincare and personal hygiene category due primarily to a slow start to the mosquito summer season and a decrease in sales of cough and cold products due to the low incidence of related illness this year; and

•$24.5 million increase due primarily to:

◦$31.9 million increase from favorable foreign currency translation; and

◦$7.0 million increase from our acquisition of three Eastern European Brands in October 2020; partially offset by

◦$14.4 million decrease due to our now-divested Rosemont pharmaceuticals business.

Operating income decreased $9.2 million, or 87.6%, due to:

•$12.4 million increase in gross profit due primarily to the increase in net sales as described above and greater operating efficiencies. Gross profit as a percentage of net sales decreased 140 basis points due primarily to unfavorable product mix, partially offset by greater operating efficiencies;

•$21.6 million increase in operating expenses due primarily to:

◦$17.3 million increase in selling, advertising and promotion expenses due primarily to the deliberate reinstatement of brand and marketing investments to pre-COVID-19 levels, and unfavorable Euro foreign currency translation; and

◦$4.2 million increase in restructuring expenses associated with actions taken to streamline the organization.

Six Month Comparison

	Six Months Ended
(in millions, except percentages)	July 3, 2021			June 27, 2020
Net sales	$	728.3		$	703.8
Gross profit	$	335.6		$	329.2
Gross profit %	46.1		%	46.8		%
Operating income	$	18.8		$	35.6
Operating income %	2.6		%	5.1		%

Six Months Ended July 3, 2021 vs. Six Months Ended June 27, 2020

Net sales increased $24.5 million, or 3.5%, due to:

•$20.2 million, or 3.0%, net decrease due primarily to a decline of $36.9 million in sales of cough and cold products due to the low incidence of related illness this year. Additional decreases were due primarily to lower consumer demand for anti-parasite products in the skincare and personal hygiene category due primarily to COVID-19 restrictions and a slow start to the mosquito summer season. These decreases were partially offset by incremental new product sales including XLS Medical Forte 5 sticks in the healthy lifestyle category, the introduction of the Probify probiotics brand in the VMS category, and the launch of Plackers® into new markets in the oral self-care category. More than offset by

•$44.7 million increase due primarily to:

◦$58.1 million increase from favorable foreign currency translation;

◦$15.3 million increase from our acquisitions of the three Eastern European Brands in October 2020 and Dr. Fresh in April 2020; partially offset by

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CSCI

◦$28.7 million decrease due to our now-divested Rosemont pharmaceuticals business.

Operating income decreased $16.8 million, or 47.2%, due to:

•$6.4 million increase in gross profit due primarily to increased net sales as described above and greater operating efficiencies. Gross profit as a percentage of net sales decreased 70 basis points due primarily to unfavorable product mix, partially offset by greater operating efficiencies;

•$23.2 million increase in operating expenses due primarily to:

◦$19.0 million increase in selling and administration expenses due primarily to:

▪$11.3 million increase in selling, advertising and promotion expenses due primarily to unfavorable foreign currency translation, more than offsetting the reduction in expenses from the divestiture of our Rosemont pharmaceuticals business; and

▪$7.7 million increase in administration expenses due primarily to unfavorable foreign currency translation, partially offset by the absence of expenses from the divestiture of our Rosemont pharmaceuticals business; and

◦$4.2 million increase in restructuring expenses associated with actions taken to streamline the organization.

Unallocated Expenses

Unallocated expenses are comprised of certain corporate services not allocated to our reporting segments and are recorded in Operating income on the Condensed Consolidated Statements of Operations. Unallocated expenses were as follows (in millions):

Three Months Ended				Six Months Ended
July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
$	55.2	$	52.4	$	117.0	$	113.2

The increase of $2.8 million in unallocated expenses during the three months ended July 3, 2021 compared to the prior year period was due primarily to a reduction in an insurance recovery receivable related to litigation contingencies and an increase in restructuring expenses, partially offset by a decrease in expenses due to our current Project Momentum cost savings initiative and higher indirect costs in the prior year period relating to the RX business.

The increase of $3.8 million in unallocated expenses during the six months ended July 3, 2021 compared to the prior year period was due to a reduction in an insurance recovery receivable related to litigation contingencies, an increase in restructuring expenses, and an increase in employee related expenses, partially offset by a decrease in expenses due to our current Project Momentum cost savings initiative and higher indirect costs in the prior year period relating to the RX business.

Change in Financial Assets, Interest expense, net, and Other (income) expense (Consolidated)

	Three Months Ended				Six Months Ended
(in millions)	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Change in financial assets	$	—	$	(2.1)	$	—	$	(3.7)
Interest expense, net	$	31.6	$	32.2	$	63.6	$	61.1
Other (income) expense, net	$	(0.4)	$	17.1	$	1.9	$	18.8

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Perrigo Company plc - Item 2

Unallocated, Interest, Other, and Taxes

Change in Financial Assets

During the year ended December 31, 2020, Royalty Pharma payments from Biogen for Tysabri® sales, as defined in the agreement between the parties, did not exceed the 2020 global net sales threshold. Therefore, we were not entitled to receive the remaining contingent milestone payment. As of December 31, 2020, there are no contingent milestone payments outstanding.

During the three and six months ended June 27, 2020, the fair value of the Royalty Pharma contingent milestone payment related to 2020 increased by $2.1 million and $3.7 million, respectively to $99.0 million, driven by higher volatility, higher projected global net sales of Tysabri® compared to the estimates in the prior period, and the estimated probability of achieving the earn-out (refer to Item 1. Note 6).

Interest Expense, Net

The $0.6 million decrease during the three months ended July 3, 2021, compared to the prior year period was due primarily to a reduction in interest expense, partially offset by a reduction in interest income.

The $2.5 million increase for the six months ended July 3, 2021, compared to the prior year period was due primarily to a reduction in interest income received, partially offset by a reduction in interest expense.

Other (Income) Expense, Net

The $17.5 million decrease in expense during the three months ended July 3, 2021 compared to the prior year period was due primarily to the absence of a $17.4 million pre-tax loss on the divestiture of our Rosemont Pharmaceuticals business and favorable changes in revaluation of monetary assets and liabilities held in foreign currencies, partially offset by an increase in losses on investment securities.

The $16.9 million decrease in expense during the six months ended July 3, 2021 compared to the prior year period was due primarily to the absence of a $17.4 million pre-tax loss on the divestiture of our Rosemont Pharmaceuticals business and favorable changes in revaluation of monetary assets and liabilities held in foreign currencies.

Income Taxes (Consolidated)

The effective tax rates were as follows:

Three Months Ended				Six Months Ended
July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
28.8	%	19.7	%	22.1	%	3.9	%

The effective tax rate for the three and six months ended July 3, 2021 increased compared to the effective tax rate for the three and six months ended June 27, 2020, primarily due to tax benefits in the 2020 periods for reductions to the U.S. valuation allowance and the U.S. Coronavirus Aid, Relief, and Economic Security ("CARES") Act, enacted in the first quarter of 2020, plus the net tax expense on 2021 intra-entity transfers of intellectual property.

FINANCIAL CONDITION, LIQUIDITY, AND CAPITAL RESOURCES

We finance our operations with internally generated funds, supplemented by credit arrangements with third parties and capital market financing. We routinely monitor current and expected operational requirements and financial market conditions to evaluate other available financing sources including term and revolving bank credit and securities offerings. In determining our future capital requirements, we regularly consider, among other factors, known trends and uncertainties, such as the Notice of Assessment ("NoA") from Irish Revenue, the Notices of Proposed Adjustment ("NOPAs") from the IRS, the current COVID-19 pandemic, and other contingencies. We note that no payment of the additional amounts assessed by Irish Revenue pursuant to the NoA or proposed by the IRS in the NOPAs is currently required, and no such payment is expected to be required, unless and until a settlement

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Financial Condition, Liquidity and Capital Resources

or other final determination of the matter is reached that is adverse to us (refer to Item 1. Note 15 for additional information on the NoA and NOPAs). Based on the foregoing, management believes that our operations and borrowing resources are sufficient to provide for our short-term and long-term capital requirements, as described below. However, an adverse result with respect to our appeal of any material outstanding tax assessments or litigation, including securities or drug pricing matters and product liability cases, damages resulting from third-party claims, and related interest and/or penalties, could ultimately require the use of corporate assets to pay such assessments and any such use of corporate assets would limit the assets available for other corporate purposes. As such, we continue to evaluate the impact of the above factors on liquidity and may determine that modifications to our capital structure are appropriate if market conditions deteriorate, favorable capital market opportunities become available, or any change in conditions relating to the NoA, the NOPAs, the COVID-19 pandemic or other contingencies have a material impact on our capital requirements. We received $1.5 billion in cash upon the completion of the RX business sale, on July 6, 2021. We are currently evaluating alternative uses for the increase in cash.

Cash and Cash Equivalents

* Cash and cash equivalents as of July 3, 2021, does not include the $1.5 billion in cash received upon the completion of the RX business sale, which happened on July 6, 2021, during the third quarter.

** Working capital represents current assets less current liabilities, excluding cash and cash equivalents, assets and liabilities held for sale, and excluding current indebtedness.

Cash, cash equivalents, cash flows from operations, and borrowings available under our credit facilities are expected to be sufficient to finance our liquidity and capital expenditures in both the short and long term. Although our lenders have made commitments to make funds available to us in a timely fashion under our revolving credit agreements and overdraft facilities, if economic conditions worsen, including due to the COVID-19 pandemic, or new information becomes publicly available impacting the institutions’ credit rating or capital ratios, these lenders may be unable or unwilling to lend money pursuant to our existing credit facilities. Should our outlook on liquidity requirements change substantially from current projections, we may seek additional sources of liquidity in the future.

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Financial Condition, Liquidity and Capital Resources

Cash Generated by (Used in) Operating Activities

The $544.8 million decrease in operating cash inflow was due primarily to:

•$336.1 million decrease in cash flow from the change in accounts receivable, due primarily to timing of sales and receipt of payments;

•$122.8 million decrease in cash flow from the change in accrued income taxes, due primarily to withholding tax on intra-entity intellectual property transfers and settlement of the Israel income tax audit, partially offset by US foreign tax credits associated with these income tax payments;

•$67.4 million decrease in cash flow from the change in inventory, due primarily to higher inventory levels from reduced sales compared to the prior year period, and the build up of inventory levels to support higher customer service levels in the CSCA segment;

•$52.1 million decrease in cash flow from the change in net earnings after adjustments for items including impairment charges, deferred income taxes, restructuring charges, changes in our financial assets, share-based compensation, amortization of debt premium, and depreciation and amortization;

•$40.7 million decrease in cash flow from the change in accrued payroll and related taxes, due primarily to the timing of payroll and the increase in annual management and employee bonus payments compared to the prior year period; and

•$24.2 million decrease in cash flow from the change in accrued liabilities, due primarily to paying the guarantee liability related to the Israel API sale and the change in royalty and profit sharing accruals; partially offset by

•$36.2 million increase in cash flow from the change in accrued customer programs, due primarily to pricing dynamics and timing of rebate and chargeback payments related to our discontinued operations, and timing of promotion activity and rebate payments in our CSCA segment;

•$34.2 million increase in cash flow from the change in prepaid expenses, due primarily to a decrease in our directors and officers prepaid insurance and annual prepaid expenses compared to the prior year period; and

•$29.0 million increase in cash flow from the change in other assets and liabilities, due primarily to fair value changes in our hedging instruments.

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Perrigo Company plc - Item 2

Financial Condition, Liquidity and Capital Resources

Cash Generated by (Used in) Investing Activities

The $114.1 million increase in cash used in investing cash flow was due primarily to:

•$187.8 million decrease in cash due to the absence of the proceeds from the divestiture of our Rosemont Pharmaceuticals business (refer to Item 1. Note 3);

•$37.8 million decrease in cash due to the increase in spending on asset acquisitions, primarily related to the payment for an ANDA for a generic topical gel for $16.4 million and the purchase of an ANDA for a generic topical lotion for $53.3 million, offset by prior year acquisitions for the Steripod® brand for $25.1 million and the Dexsil® brand for approximately $8.0 million (refer to Item 1. Note 3); and

•$8.3 million decrease in cash due to the change in capital spending, primarily to increase tablet and infant formula capacity and for software and technology initiatives; partially offset by

•$106.0 million increase in cash due to the absence of the payment for the acquisition of Dr. Fresh (refer to Item 1. Note 3); and

•$15.0 million increase in cash due to the absence of the payment for the purchase of our equity method investment in Kazmira LLC.

Cash Generated by (Used in) Financing Activities

The $751.2 million decrease in financing cash flow was due primarily to:

•$743.8 million decrease due to absence of the debt issuance completed in the prior year; and

•$7.4 million decrease due primarily to the payment made on the Kazmira promissory notes.

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Financial Condition, Liquidity and Capital Resources

Dividends    

The declaration and payment of dividends, if any, is subject to the discretion of our Board of Directors and will depend on our earnings, financial condition, availability of distributable reserves, capital and surplus requirements, and other factors our Board of Directors may consider relevant.

Share Repurchases

In October 2018, our Board of Directors authorized up to $1.0 billion of share repurchases with no expiration date, subject to the Board of Directors’ approval of the pricing parameters and amount that may be repurchased under each specific share repurchase program. We did not repurchase any shares during the three and six months ended July 3, 2021 or June 27, 2020.

Borrowings and Capital Resources

Revolving Credit Agreements

On March 8, 2018, we entered into a $1.0 billion revolving credit agreement maturing on March 8, 2023 (the "2018 Revolver"). There were no borrowings outstanding under the 2018 Revolver as of July 3, 2021 or December 31, 2020.

Term Loans and Notes

We had $2.9 billion outstanding under our notes and bonds as of both July 3, 2021 and December 31, 2020. In August 2019, we refinanced a prior term loan with the proceeds of a new $600.0 million term loan, maturing on August 15, 2022 (the "2019 Term Loan"). We had $600.0 million outstanding under our 2019 Term Loan as of both July 3, 2021 and December 31, 2020.

Waiver of Debt Covenants

We are subject to financial covenants in the 2018 Revolver and 2019 Term Loan, including a maximum leverage ratio covenant, which previously required us to maintain a ratio of Consolidated Net Indebtedness to Consolidated EBITDA (as such terms are defined in the respective credit agreements) of not more than 3.75 to 1.00 at the end of each fiscal quarter. As of July 3, 2021, we were not in compliance with such covenant. However, we have received a waiver of such covenant from the lenders under both credit facilities and have entered into an amendment to each of the 2018 Revolver and 2019 Term Loan. Under such amendments, the maximum leverage ratio was increased to 5.75 to 1.00 for the third quarter of 2021, returning to 3.75 to 1.00 beginning with the fourth quarter of 2021. If we consummate certain qualifying acquisitions in the fourth quarter of 2021 or any subsequent quarter during the term of the loan, the maximum ratio would increase to 4.00 to 1.00 for such quarter. Neither the failure to meet the leverage covenant for the second quarter of 2021, nor the waiver and amendments described above, affect our ability to draw under the 2018 Revolver. No assurance can be given that the Company will meet the leverage covenant under such credit agreements. However, given the Company’s strong cash position, we do not believe that any failure to comply with such leverage covenant would have a material adverse effect on the

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Perrigo Company plc - Item 2

Financial Condition, Liquidity and Capital Resources

Company or its liquidity. The 2019 Term Loan currently matures in the third quarter of 2022, and the amount outstanding thereunder has been classified as current indebtedness on our balance sheet as of July 3, 2021. The Company is currently evaluating various options relating to the 2018 Revolver and the 2019 Term Loan, which may include further amendments, repayment of the 2019 Term Loan, and/or refinancing.

Other Financing

On June 17, 2020, we incurred debt of $34.3 million related to our equity method investment in Kazmira pursuant to two Promissory Notes, with $3.7 million, $5.8 million and $24.8 million to be settled in November 2020, May 2021 and November 2021, respectively. On December 8, 2020, we repaid the $3.7 million balance due on the November 2020 portion of the Promissory Notes. On June 7, 2021, we repaid the $5.8 million balance due on the May 2021 portion of the Promissory Notes.

Overdraft Facilities

We have overdraft facilities available that we use to support our cash management operations. There were no borrowings outstanding under the facilities as of July 3, 2021 or December 31, 2020.

Leases

We had $206.0 million and $187.7 million of lease liabilities and $202.3 million and $184.5 million of lease assets as of July 3, 2021 and December 31, 2020, respectively.

Accounts Receivable Factoring

The total amount factored on a non-recourse basis and excluded from accounts receivable was $0.4 million and $6.9 million at July 3, 2021 and December 31, 2020, respectively.

Refer to Item 1. Note 11 and Note 12 for more information on all of the above lease activity and debt facilities, respectively.

Credit Ratings

Our credit ratings on July 3, 2021 were Baa3 (negative), BBB- (negative), and BBB- (negative) by Moody's Investors Service, S&P Global Ratings, and Fitch Ratings Inc., respectively. Subsequent to quarter end, Moody's Investor Service downgraded our credit rating to a Ba1 (negative).

Credit rating agencies review their ratings periodically and, therefore, the credit rating assigned to us by each agency may be subject to revision at any time. Accordingly, we are not able to predict whether current credit ratings will remain as disclosed above. Factors that can affect our credit ratings include changes in operating performance, the economic environment, our financial position, and changes in business strategy. If changes in our credit ratings were to occur, they could impact, among other things, future borrowing costs, access to capital markets, and vendor financing terms.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements that have a material current effect or that are reasonably likely to have a material future effect on our financial condition, changes in financial condition, net sales or expenses, results of operations, liquidity, capital expenditures, or capital resources. We acquire and collaborate on potential products still in development and enter into R&D arrangements with third parties that often require milestone payments to the third-party contingent upon the occurrence of certain future events linked to the success of the asset in development. Milestone payments may be required contingent upon the successful achievement of an important point in the development life cycle of the product. Because of the contingent nature of these payments, they are not included in our table of contractual obligations.

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Perrigo Company plc - Item 2

Financial Condition, Liquidity and Capital Resources

Contractual Obligations and Commitments

There were no material changes in contractual obligations as of July 3, 2021 from those provided in our 2020 Form 10-K.

Significant Accounting Policies

Other than the adoption of ASU 2019-12: Income taxes (refer to Item 1. Note 15), there have been no material changes to the significant accounting policies as disclosed in our 2020 Form 10-K.

Critical Accounting Estimates

The determination of certain amounts in our financial statements requires the use of estimates. These estimates are based upon our historical experiences combined with management’s understanding of current facts and circumstances. Although the estimates are considered reasonable based on the currently available information, actual results could differ from the estimates we have used. There have been no material changes to the critical accounting estimates as disclosed in our 2020 Form 10-K.

ITEM 3.        QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes to our quantitative or qualitative disclosures found in Item 7A, "Quantitative and Qualitative Disclosures about Market Risk," of our 2020 Form 10-K.

ITEM 4.        CONTROLS AND PROCEDURES

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) or 15d-15(e) of the Exchange Act) as of July 3, 2021. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures are effective in ensuring that all material information relating to us and our consolidated subsidiaries required to be included in our periodic SEC filings would be made known to them by others within those entities in a timely manner and that no changes are required at this time.

Evaluation of the Effectiveness of Internal Control over Financial Reporting

Our management assessed the effectiveness of our internal control over financial reporting as of July 3, 2021. The framework used in carrying out our evaluation was the 2013 Internal Control - Integrated Framework published by the Committee of Sponsoring Organizations ("COSO") of the Treadway Commission. In evaluating our information technology controls, we also used components of the framework contained in the Control Objectives for Information and related Technology, which was developed by the Information Systems Audit and Control Association’s IT Governance Institute, as a complement to the COSO internal control framework. Management has concluded that our internal control over financial reporting was effective as of July 3, 2021. The results of management’s assessment have been reviewed with our Audit Committee.

Changes in Internal Control over Financial Reporting

There have been no changes in our internal control over financial reporting during the three months ended July 3, 2021 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II.     OTHER INFORMATION

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ITEM 1.    LEGAL PROCEEDINGS

Refer to Item 1. Note 15 and Item 1. Note 16 of the Notes to the Condensed Consolidated Financial Statements.

ITEM 1A.    RISK FACTORS

Our Annual Report on Form 10-K for the year ended December 31, 2020 includes a detailed discussion of our risk factors. At the time of this filing, there have been no material changes to the risk factors that were included in the Form 10-K.

ITEM 5. OTHER INFORMATION

On August 10, 2021, we entered into Amendment No. 1 and Waiver to our 2019 Term Loan (the “Term Loan Amendment”) and Amendment No. 2 and Waiver to our 2018 Revolver (the “Revolver Amendment”) with the lenders under each such facility, pursuant to which the lenders waived our non-compliance with the covenant to maintain a ratio of Consolidated Net Indebtedness to Consolidated EBITDA (as such terms are defined in such credit agreements) of not more than 3.75 to 1.00 as of the end of each fiscal quarter, with which we were not in compliance with as of July 3, 2021. Under such amendments, the maximum leverage ratio was increased to 5.75 to 1.00 for the third quarter of 2021, returning to 3.75 to 1.00 beginning with the fourth quarter of 2021. If we consummate certain qualifying acquisitions in the fourth quarter of 2021 or any subsequent quarter during the term of the loan, the maximum ratio would increase to 4.00 to 1.00 for such quarter. Neither the failure to meet the leverage covenant for the second quarter of 2021, nor the waiver and amendments described above, affect our ability to draw under the 2018 Revolver. The amendments also modified certain provisions related to restricted payments to account for the amended leverage ratio covenant.

The foregoing descriptions of the Term Loan Amendment and Revolver Amendment do not propose to be complete and are qualified in their entirety by reference to the full text of the Term Loan Amendment and Revolver Amendment, copies of which are attached hereto as Exhibit 10.2 and Exhibit 10.3, and the terms of which are incorporated herein by reference.

69

Perrigo Company plc - Item 6

Exhibits

ITEM 6.    EXHIBITS

Exhibit Number	Description
3.1	Certificate of Incorporation of Perrigo Company plc (formerly known as Perrigo Company Limited) (incorporated by reference from Exhibit 4.1 to the Company’s Registration Statement on Form S-8 filed on December 19, 2013).
3.2	Memorandum and Articles of Association of Perrigo Company plc, as amended and restated (incorporated by reference from Exhibit 3.2 to the Company’s Quarterly Report on Form 10-Q filed on August 10, 2017).
10.1	Amendment to Stock and Asset Purchase Agreement, by and between Perrigo Company plc and Padagis LLC, dated as of July 6, 2021 (incorporated by reference from Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on July 12, 2021).
10.2	Amendment No. 1 and Waiver to 2019 Term Loan, dated as of August 10, 2021, by and among Perrigo Finance Unlimited Company, Perrigo Company plc, JPMorgan Chase Bank, N.A., and the other lenders party thereto, dated as of August 15, 2019 (filed herewith).
10.3	Amendment No. 2 and Waiver to 2018 Revolver, dated as of August 10, 2021, by and among Perrigo Finance Unlimited Company, Perrigo Company plc, JPMorgan Chase Bank, N.A., and the other lenders party thereto, dated as of August 15, 2019 (filed herewith).
31.1	Rule 13a-14(a) Certification by Murray S. Kessler, Chief Executive Officer (filed herewith).
31.2	Rule 13a-14(a) Certification by Raymond P. Silcock, Chief Financial Officer (filed herewith).
32	Certification Pursuant to 18 United States Code 1350 and Rule 13a-14(b) of the Securities Exchange Act of 1934 (furnished herewith).
101. INS	XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH	XBRL Taxonomy Extension Schema Document.
101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF	XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB	XBRL Taxonomy Extension Label Linkbase Document.
101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document.
104	Cover Page Interactive Date File, formatted in Inline XBRL (contained in Exhibit 101).

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

		PERRIGO COMPANY PLC
		(Registrant)
Date:	August 11, 2021	/s/ Murray S. Kessler
		Murray S. Kessler
		Chief Executive Officer and President
		(Principal Executive Officer)
Date:	August 11, 2021	/s/ Raymond P. Silcock
		Raymond P. Silcock
		Chief Financial Officer
		(Principal Accounting and Financial Officer)

71

EX-10.2

Exhibit 10.2

This AMENDMENT NO. 1 AND WAIVER (this “Amendment No. 1”), dated as of August 10, 2021 and entered into by and among Perrigo Finance Unlimited Company, a public unlimited company organized under the laws of Ireland (the “Term Facility Borrower”), Perrigo Company PLC, a public limited company organized under the laws of Ireland (the “Company”), each lender party hereto (each a “Consenting Lender” and, collectively, the “Consenting Lenders”) and JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the “Administrative Agent”), amends and is made pursuant to that certain Term Loan Credit Agreement, dated as of August 15, 2019 (as amended, restated, supplemented, waived or otherwise modified from time to time prior to the date hereof, the “Credit Agreement”), by and among the Term Facility Borrower, the Company, the lenders from time to time party thereto, the Administrative Agent and the other agents party thereto.

W I T N E S S E T H :

WHEREAS, the Term Facility Borrower has requested that the terms of the Credit Agreement be amended as set forth herein;

WHEREAS, by signing this Amendment No. 1, each Consenting Lender has consented to this Amendment No. 1 and to the amendments to the Credit Agreement described in Section 2 below; and

WHEREAS, the Term Facility Borrower has informed the Administrative Agent that it will not be in compliance with the Leverage Ratio covenant set forth in Section 6.10 of the Credit Agreement for the Fiscal Quarter ended June 30, 2021 (the “Specified Event of Default”) and requests that the Administrative Agent and the Required Lenders waive the Specified Event of Default and the Administrative Agent and the Consenting Lenders have agreed to waive the Specified Event of Default on the terms and conditions specified herein;

NOW, THEREFORE, in consideration of the premises contained herein, the parties hereto agree as follows:

1.Defined Terms; References. Except as otherwise defined in this Amendment No. 1, terms defined in the Credit Agreement are used herein (including the recitals hereto) as defined therein. On and after the Amendment Effective Date (as defined below), each reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof” or words of like import referring to the Credit Agreement shall mean and be a reference to the Credit Agreement, as amended by this Amendment No. 1.

2.Amendments. The Administrative Agent and each Consenting Lender hereby consent to amend the Credit Agreement as follows:

(a)Clause (f) of Section 6.06 of the Credit Agreement shall be replaced in its entirety with the following:

“(f) the Company may make Restricted Payments with respect to its Equity Interests so long as no Default exists or would be caused thereby, provided that, with respect to Restricted Payments pursuant to this clause (f), prior to December 31, 2021, the Company will not declare or make, or agree to pay or make, directly or indirectly, any such Restricted Payments, except (i) if after giving effect on a pro forma basis to such Restricted Payment and any Indebtedness incurred in connection therewith, the Leverage Ratio as of the most recently ended fiscal quarter for which financial statements have been delivered does not exceed 3.75 to 1.0, (ii) that the Company may declare and pay regularly scheduled dividends with respect to its Equity Interests, or (iii) the

Company may make Restricted Payments in an amount not to exceed $50,000,000 so long as no Default exists or would be caused thereby.”

(b)Section 6.10 of the Credit Agreement shall be replaced in its entirety with the following:

“SECTION 6.10. Leverage Ratio. (i) For the Fiscal Quarter ended on or about September 30, 2021, the Company will not permit the Leverage Ratio to exceed 5.75 to 1.0 as of the last day of such Fiscal Quarter of the Company and (ii) beginning with the Fiscal Quarter ended on or about December 31, 2021, the Company will not permit the Leverage Ratio to exceed 3.75 to 1.0 as of the last day of any Fiscal Quarter of the Company; provided that, with respect to clause (ii) only, during a Fiscal Quarter in which a Qualified Acquisition has occurred and for the four following Fiscal Quarters, such limit will be increased so that the Company will not permit the Leverage Ratio to exceed 4.0 to 1.0 as of the last day of any such Fiscal Quarter of the Company; providedfurther that such increase may not occur with respect to more than three (3) Qualified Acquisitions during the term of this Agreement.”

3.Limited Waiver. The Consenting Lenders party hereto (constituting the Required Lenders) and the Administrative Agent hereby waive (the “Waiver”), on a one-time basis, the Specified Event of Default. This Waiver shall be effective only to the extent specifically set forth herein and shall not (a) be construed as a waiver of any breach, Default or Event of Default other than as specifically waived herein nor as a waiver of any breach, Default or Event of Default of which the Lenders have not been informed by the Loan Parties, (b) affect the right of the Lenders to demand compliance by the Loan Parties with all terms and conditions of the Loan Documents, except as specifically modified or waived by this Waiver, (c) be deemed a waiver of any transaction or future action on the part of the Loan Parties requiring the Lenders’ or the Required Lenders’ consent or approval under the Loan Documents, or (d) except as waived hereby, be deemed or construed to be a waiver or release of, or a limitation upon, the Administrative Agent’s or the Lenders’ exercise of any rights or remedies under the Credit Agreement or any other Loan Document, whether arising as a consequence of any Default or Event of Default (other than with respect to the Default or Events of Default waived hereby, including the Specified Event of Default) which may now exist or otherwise, all such rights and remedies hereby being expressly reserved.

4.Representations and Warranties; Loan Document. Each of the Term Facility Borrower and the Company hereby represents and warrants that as of the date hereof (a) the representations and warranties of the Loan Parties set forth in the Loan Documents are true and correct in all material respects (except that any representation or warranty which is already qualified as to materiality or by reference to Material Adverse Effect is true and correct in all respects) on and as of such date, with the same effect as if made on and as of such date (other than those representations and warranties that by their terms expressly relate to an earlier date, in which case such representations and warranties were true and correct in all material respects as of such earlier date) and (b) after giving effect to the Waiver, no Default or Event of Default has occurred and is continuing. This Amendment No. 1 is a “Loan Document,” as defined in the Credit Agreement.

5.Conditions. The amendments contained in Section 2 of this Amendment No. 1 and the Waiver shall become effective on the date (the “Amendment Effective Date”) on which each of the following conditions shall have been satisfied:

(c)The Administrative Agent shall have received counterparts of this Amendment No. 1 duly executed and delivered by the Term Facility Borrower, the Company, each Consenting Lender constituting the Required Lenders and the Administrative Agent.

2

(d)The representations and warranties of each Loan Party set forth in Section 4 above are true and correct on and as of the Amendment Effective Date.

(e)The Term Facility Borrower shall have paid all fees and expenses for which invoices have been presented on or prior to the Amendment Effective Date, including reasonable legal fees and disbursements of counsel to the Administrative Agent.

(f)The Term Facility Borrower shall have paid to the Administrative Agent, for the account of each Consenting Lender, a non-refundable and fully earned fee equal to 0.025% of each such Consenting Lender’s aggregate Commitments as of the Amendment Effective Date.

6.Continuing Effect; No Other Amendments or Modifications; Reaffirmation. Except as expressly provided herein, all of the terms and provisions of the Credit Agreement are and shall remain in full force and effect. The amendments provided for herein are limited to the specific subsection(s) of the Credit Agreement specified herein and shall not constitute an amendment or other modification of, or an indication of the Administrative Agent’s or the Consenting Lenders’ willingness to amend or modify any other provisions of the Credit Agreement. Each of the Term Facility Borrower and the Company hereby acknowledges and agrees that, after giving effect to this Amendment No. 1, except as expressly set forth in this Amendment No. 1, all of its respective obligations and liabilities under the Loan Documents (including, without limitation, the Guaranty executed by the Company) to which it is a party are reaffirmed, and remain in full force and effect. The execution, delivery and performance of this Amendment No. 1 shall not constitute a waiver of any provision of, or operate as a waiver of any right, power or remedy of any Agent or Consenting Lender under, the Credit Agreement or any of the other Loan Documents. This Amendment No. 1 shall not constitute a novation of the Credit Agreement or any of the other Loan Documents.

7.Expenses. The Term Facility Borrower agrees to pay and reimburse the Administrative Agent for all its reasonable costs and out-of-pocket expenses incurred in connection with the preparation and delivery of this Amendment No. 1, including, without limitation, the reasonable fees and disbursements of counsel to the Administrative Agent.

8.Headings. Section headings herein and in the Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Amendment No. 1 or any other Loan Document.

9.Counterparts. This Amendment No. 1 may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Amendment No. 1 by email or facsimile transmission or other electronic means shall be effective as delivery of a manually executed counterpart of this Amendment No. 1. The words “execution,” “signed,” “signature,” “delivery,” and words of like import in or relating to this letter agreement and/or any document to be signed in connection with this letter agreement and the transactions contemplated hereby shall be deemed to include Electronic Signatures (as defined below), deliveries or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be. “Electronic Signatures” means any electronic symbol or process attached to, or associated with, any contract or other record and adopted by a person with the intent to sign, authenticate or accept such contract or record.

3

10.GOVERNING LAW. THIS AMENDMENT NO. 1 SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK. SECTIONS 9.09 AND 9.10 OF THE CREDIT AGREEMENT ARE INCORPORATED BY REFERENCE HEREIN MUTATIS MUTANDIS.

[remainder of page intentionally left blank]

4

IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 1 to be duly executed and delivered by their respective authorized officers as of the day and year first above written.

PERRIGO FINANCE UNLIMITED COMPANY, as the Term Facility Borrower

By:	/s/ Sonia A. Hollies
Name:	Sonia A. Hollies
Title	SVP, Global Tax, Risk Management & Treasurer

PERRIGO COMPANY PLC, as the Company

By:	/s/ Sonia A. Hollies
Name:	Sonia A. Hollies
Title	SVP, Global Tax, Risk Management & Treasurer

[Perrigo - Term Loan Amendment No. 1]

JPMORGAN CHASE BANK, N.A., as Administrative Agent

By:	/s/ Gregory T. Martin
Name:	Gregory T. Martin
Title:	Executive Director

[Perrigo - Term Loan Amendment No. 1]

JPMORGAN CHASE BANK, N.A., as a Lender

By:	/s/ Gregory T. Martin
Name:	Gregory T. Martin
Title:	Executive Director

[Perrigo - Term Loan Amendment No. 1]

HSBC Bank USA, N.A., as a Lender

By:	/s/ Eric Seltenrich
Name:	Eric Seltenrich
Title:	Managing Director

[Perrigo - Term Loan Amendment No. 1]

WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender

By:	/s/ Jordan Harris
Name:	Jordan Harris
Title:	Managing Director

[Perrigo - Term Loan Amendment No. 1]

BANK OF AMERICA, N.A., as a Lender

By:	/s/ Joseph L. Corah
Name:	Joseph L. Corah
Title:	Director

[Perrigo - Term Loan Amendment No. 1]

FIFTH THIRD BANK, as a Lender

By:	/s/ Nathaniel E. Sher
Name:	Nathaniel E. (Ned) Sher
Title:	Managing Director

[Perrigo - Term Loan Amendment No. 1]

ING BANK N.V., DUBLIN BRANCH, as a Lender

By:	/s/ Cormac Langford
Name:	Cormac Langford
Title:	Director

By:	/s/ Sean Hassett
Name:	Sean Hassett
Title:	Director

[Perrigo - Term Loan Amendment No. 1]

MIZUHO BANK, LTD., as a Lender

By:	/s/ John Davies
Name:	John Davies
Title:	Executive Director

[Perrigo - Term Loan Amendment No. 1]

CITIZENS BANK, N.A., as a Lender

By:	/s/ Christopher J. DeLauro
Name:	Christopher J. DeLauro
Title:	SVP

[Perrigo - Term Loan Amendment No. 1]

PNC BANK, N.A., as a Lender

By:	/s/ Brock Dana
Name:	Brock Dana
Title:	Senior Vice President

[Perrigo - Term Loan Amendment No. 1]

U.S. BANK NATIONAL ASSOCIATION, as a Lender

By:	/s/ Michael West
Name:	Michael West
Title:	Senior Vice President

[Perrigo - Term Loan Amendment No. 1]

EX-10.3

Exhibit 10.3

This AMENDMENT NO. 2 AND WAIVER (this “Amendment No. 2”), dated as of August 10, 2021 and entered into by and among Perrigo Finance Unlimited Company, a public unlimited company organized under the laws of Ireland (the “Revolving Borrower”), Perrigo Company PLC, a public limited company organized under the laws of Ireland (the “Company”), each lender party hereto (each a “Consenting Lender” and, collectively, the “Consenting Lenders”) and JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the “Administrative Agent”), amends and is made pursuant to that certain Revolving Credit Agreement, dated as of March 8, 2018 (as amended by Amendment No. 1, dated as of August 15, 2019, and as further amended, restated, supplemented, waived or otherwise modified from time to time prior to the date hereof, the “Credit Agreement”), by and among the Revolving Borrower, the Company, the lenders from time to time party thereto, the Administrative Agent and the other agents party thereto.

W I T N E S S E T H :

WHEREAS, the Revolving Borrower has requested that the terms of the Credit Agreement be amended as set forth herein;

WHEREAS, by signing this Amendment No. 2, each Consenting Lender has consented to this Amendment No. 2 and to the amendments to the Credit Agreement described in Section 2 below; and

WHEREAS, the Revolving Borrower has informed the Administrative Agent that it will not be in compliance with the Leverage Ratio covenant set forth in Section 6.10 of the Credit Agreement for the Fiscal Quarter ended June 30, 2021 (the “Specified Event of Default”) and requests that the Administrative Agent and the Required Lenders waive the Specified Event of Default and the Administrative Agent and the Consenting Lenders have agreed to waive the Specified Event of Default on the terms and conditions specified herein;

NOW, THEREFORE, in consideration of the premises contained herein, the parties hereto agree as follows:

1.Defined Terms; References. Except as otherwise defined in this Amendment No. 2, terms defined in the Credit Agreement are used herein (including the recitals hereto) as defined therein. On and after the Amendment Effective Date (as defined below), each reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof” or words of like import referring to the Credit Agreement shall mean and be a reference to the Credit Agreement, as amended by this Amendment No. 2.

2.Amendments. The Administrative Agent and each Consenting Lender hereby consent to amend the Credit Agreement as follows:

(a)Clause (f) of Section 6.06 of the Credit Agreement shall be replaced in its entirety with the following:

“(f) the Company may make Restricted Payments with respect to its Equity Interests so long as no Default exists or would be caused thereby, provided that, with respect to Restricted Payments pursuant to this clause (f), prior to December 31, 2021, the Company will not declare or make, or agree to pay or make, directly or indirectly, any such Restricted Payments, except (i) if after giving effect on a pro forma basis to such Restricted Payment and any Indebtedness incurred in connection therewith, the Leverage Ratio as of the most recently ended fiscal quarter for which

financial statements have been delivered does not exceed 3.75 to 1.0, (ii) that the Company may declare and pay regularly scheduled dividends with respect to its Equity Interests, or (iii) the Company may make Restricted Payments in an amount not to exceed $50,000,000 so long as no Default exists or would be caused thereby.”

(b)Section 6.10 of the Credit Agreement shall be replaced in its entirety with the following:

“SECTION 6.10. Leverage Ratio. (i) For the Fiscal Quarter ended on or about September 30, 2021, the Company will not permit the Leverage Ratio to exceed 5.75 to 1.0 as of the last day of such Fiscal Quarter of the Company and (ii) beginning with the Fiscal Quarter ended on or about December 31, 2021, the Company will not permit the Leverage Ratio to exceed 3.75 to 1.0 as of the last day of any Fiscal Quarter of the Company; provided that, with respect to clause (ii) only, during a Fiscal Quarter in which a Qualified Acquisition has occurred and for the four following Fiscal Quarters, such limit will be increased so that the Company will not permit the Leverage Ratio to exceed 4.0 to 1.0 as of the last day of any such Fiscal Quarter of the Company; providedfurther that such increase may not occur with respect to more than three (3) Qualified Acquisitions during the term of this Agreement.”

3.Limited Waiver. The Consenting Lenders party hereto (constituting the Required Lenders) and the Administrative Agent hereby waive (the “Waiver”), on a one-time basis, the Specified Event of Default. This Waiver shall be effective only to the extent specifically set forth herein and shall not (a) be construed as a waiver of any breach, Default or Event of Default other than as specifically waived herein nor as a waiver of any breach, Default or Event of Default of which the Lenders have not been informed by the Loan Parties, (b) affect the right of the Lenders to demand compliance by the Loan Parties with all terms and conditions of the Loan Documents, except as specifically modified or waived by this Waiver, (c) be deemed a waiver of any transaction or future action on the part of the Loan Parties requiring the Lenders’ or the Required Lenders’ consent or approval under the Loan Documents, or (d) except as waived hereby, be deemed or construed to be a waiver or release of, or a limitation upon, the Administrative Agent’s or the Lenders’ exercise of any rights or remedies under the Credit Agreement or any other Loan Document, whether arising as a consequence of any Default or Event of Default (other than with respect to the Default or Events of Default waived hereby, including the Specified Event of Default) which may now exist or otherwise, all such rights and remedies hereby being expressly reserved.

4.Representations and Warranties; Loan Document. Each of the Revolving Borrower and the Company hereby represents and warrants that as of the date hereof (a) the representations and warranties of the Loan Parties set forth in the Loan Documents are true and correct in all material respects (except that any representation or warranty which is already qualified as to materiality or by reference to Material Adverse Effect is true and correct in all respects) on and as of such date, with the same effect as if made on and as of such date (other than those representations and warranties that by their terms expressly relate to an earlier date, in which case such representations and warranties were true and correct in all material respects as of such earlier date) and (b) after giving effect to the Waiver, no Default or Event of Default has occurred and is continuing. This Amendment No. 2 is a “Loan Document,” as defined in the Credit Agreement.

5.Conditions. The amendments contained in Section 2 of this Amendment No. 2 and the Waiver shall become effective on the date (the “Amendment Effective Date”) on which each of the following conditions shall have been satisfied:

(c)The Administrative Agent shall have received counterparts of this Amendment No. 2 duly executed and delivered by the Revolving Borrower, the Company, each Consenting Lender constituting the Required Lenders and the Administrative Agent.

(d)The representations and warranties of each Loan Party set forth in Section 4 above are true and correct on and as of the Amendment Effective Date.

(e)The Revolving Borrower shall have paid all fees and expenses for which invoices have been presented on or prior to the Amendment Effective Date, including reasonable legal fees and disbursements of counsel to the Administrative Agent.

(f)The Revolving Borrower shall have paid to the Administrative Agent, for the account of each Consenting Lender, a non-refundable and fully earned fee equal to 0.025% of each such Consenting Lender’s aggregate Commitments as of the Amendment Effective Date.

6.Continuing Effect; No Other Amendments or Modifications; Reaffirmation. Except as expressly provided herein, all of the terms and provisions of the Credit Agreement are and shall remain in full force and effect. The amendments provided for herein are limited to the specific subsection(s) of the Credit Agreement specified herein and shall not constitute an amendment or other modification of, or an indication of the Administrative Agent’s or the Consenting Lenders’ willingness to amend or modify any other provisions of the Credit Agreement. Each of the Revolving Borrower and the Company hereby acknowledges and agrees that, after giving effect to this Amendment No. 2, except as expressly set forth in this Amendment No. 2, all of its respective obligations and liabilities under the Loan Documents (including, without limitation, the Guaranty executed by the Company) to which it is a party are reaffirmed, and remain in full force and effect. The execution, delivery and performance of this Amendment No. 2 shall not constitute a waiver of any provision of, or operate as a waiver of any right, power or remedy of any Agent or Consenting Lender under, the Credit Agreement or any of the other Loan Documents. This Amendment No. 2 shall not constitute a novation of the Credit Agreement or any of the other Loan Documents.

7.Expenses. The Revolving Borrower agrees to pay and reimburse the Administrative Agent for all its reasonable costs and out-of-pocket expenses incurred in connection with the preparation and delivery of this Amendment No. 2, including, without limitation, the reasonable fees and disbursements of counsel to the Administrative Agent.

8.Headings. Section headings herein and in the Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Amendment No. 2 or any other Loan Document.

9.Counterparts. This Amendment No. 2 may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Amendment No. 2 by email or facsimile transmission or other electronic means shall be effective as delivery of a manually executed counterpart of this Amendment No. 2. The words “execution,” “signed,” “signature,” “delivery,” and words of like import in or relating to this letter agreement and/or any document to be signed in connection with this letter agreement and the transactions contemplated hereby shall be deemed to include Electronic Signatures (as defined below), deliveries or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be. “Electronic Signatures” means any electronic symbol or process attached to, or associated with, any contract or other record and adopted by a person with the intent to sign, authenticate or accept such contract or record.

10.GOVERNING LAW. THIS AMENDMENT NO. 2 SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK. SECTIONS 9.09 AND 9.10 OF THE CREDIT AGREEMENT ARE INCORPORATED BY REFERENCE HEREIN MUTATIS MUTANDIS.

[remainder of page intentionally left blank]

IN WITNESS WHEREOF, the parties hereto have caused this Amendment No. 2 to be duly executed and delivered by their respective authorized officers as of the day and year first above written.

PERRIGO FINANCE UNLIMITED COMPANY, as the Revolving Borrower

By:	/s/ Sonia A. Hollies
Name:	Sonia A. Hollies
Title:	SVP, Global Tax, Risk Management & Treasurer

PERRIGO COMPANY PLC, as the Company

By:	/s/ Sonia A. Hollies
Name:	Sonia A. Hollies
Title:	SVP, Global Tax, Risk Management & Treasurer

JPMORGAN CHASE BANK, N.A., as Administrative Agent

By:	/s/ Gregory T. Martin
Name:	Gregory T. Martin
Title:	Executive Director

JPMORGAN CHASE BANK, N.A., as a Lender

By:	/s/ Gregory T. Martin
Name:	Gregory T. Martin
Title:	Executive Director

HSBC Bank USA, N.A., as a Lender

By:	/s/ Eric Seltenrich
Name:	Eric Seltenrich
Title:	Managing Director

WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender

By:	/s/ Jordan Harris
Name:	Jordan Harris
Title:	Managing Director

BANK OF AMERICA, N.A., as a Lender

By:	/s/ Joseph L. Corah
Name:	Joseph L. Corah
Title:	Director

BARCLAYS BANK, PLC, as a Lender

By:	/s/ Edward Pan
Name:	Edward Pan
Title:	Associate

CITIBANK, N.A., as a Lender

By:	/s/ Robert J. Kane
Name:	Robert J. Kane
Title:	Managing Director

CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as a Lender

By:	/s/ Judith Smith
Name:	Judith Smith
Title:	Authorized Signatory

By:	/s/ Jessica Gavarkovs
Name:	Jessica Gavarkovs
Title:	Authorized Signatory

DEUTSCHE BANK AG NEW YORK BRANCH, as a Lender

By:	/s/ Ming K Chu
Name:	Ming K Chu
Title:	Director

If a second signature is necessary:

DEUTSCHE BANK AG NEW YORK BRANCH, as a Lender

By:	/s/ Marko Lukin
Name:	Marko Lukin
Title:	Vice President

BNP PARIBAS, as a Lender

By:	/s/ Reid Hill
Name:	Reid Hill
Title:	Managing Director

BNP PARIBAS, as a Lender

By:	/s/ John Bosco
Name:	John Bosco
Title:	Managing Director

FIFTH THIRD BANK, as a Lender

By:	/s/ Nathaniel E. Sher
Name:	Nathaniel E. (Ned) Sher
Title:	Managing Director

ING BANK N.V., DUBLIN BRANCH, as a Lender

By:	/s/ Cormac Langford
Name:	Cormac Langford
Title:	Director

By:	/s/ Sean Hassett
Name:	Sean Hassett
Title:	Director

MIZUHO BANK, LTD., as a Lender

By:	/s/ John Davies
Name:	John Davies
Title:	Authorized Signatory

CITIZENS BANK, N.A., as a Lender

By:	/s/ Christopher J. DeLauro
Name:	Christopher J. DeLauro
Title:	SVP

PNC BANK, N.A., as a Lender

By:	/s/ Brock Dana
Name:	Brock Dana
Title:	Senior Vice President

U.S. BANK NATIONAL ASSOCIATION, as a Lender

By:	/s/ Michael West
Name:	Michael West
Title:	Senior Vice President

SOCIETE GENERALE, as Lender

By:	/s/ Kimberly Metzger
Name:	Kimberly Metzger
Title:	Director

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Murray S. Kessler, certify that:

1.I have reviewed this report on Form 10-Q of Perrigo Company 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 Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and 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 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:

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: August 11, 2021

/s/ Murray S. Kessler

Murray S. Kessler

Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Raymond P. Silcock, certify that:

1.I have reviewed this report on Form 10-Q of Perrigo Company 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 Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and 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 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:

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: August 11, 2021

/s/ Raymond P. Silcock

Raymond P. Silcock

Chief Financial Officer

EX-32

Exhibit 32

The following statement is being made to the Securities and Exchange Commission solely for the purposes of Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350), which carries with it certain criminal penalties in the event of a knowing or willful misrepresentation.

Securities and Exchange Commission

450 100 F Street NE

Washington, D.C. 20549

Re: Perrigo Company plc

Ladies and Gentlemen:

In accordance with the requirements of Section 906 of the Sarbanes-Oxley Act of 2002 (18 U.S.C. 1350), each of the undersigned hereby certifies that:

(i)this Quarterly Report on Form 10-Q for the period ended July 3, 2021 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and

(ii)the information contained in this Report fairly presents, in all material respects, the financial condition and results of operations of Perrigo Company plc.

Date:	August 11, 2021	/s/ Murray S. Kessler
		Murray S. Kessler
		Chief Executive Officer and President
Date:	August 11, 2021	/s/ Raymond P. Silcock
		Raymond P. Silcock
		Chief Financial Officer

XML

Cover Page - shares	6 Months Ended
	Jul. 03, 2021	Aug. 06, 2021
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document period end date	Jul. 03, 2021
Document Transition Report	false
Entity File Number	001-36353
Entity registrant name	Perrigo Company plc
Entity Incorporation, State or Country Code	L2
Entity Address, Address Line One	The Sharp Building,
Entity Address, Address Line Two	Hogan Place,
Entity Address, City or Town	Dublin 2,
Entity Address, Country	IE
Entity Address, Postal Zip Code	D02 TY74
Country Region	353
City Area Code	1
Local Phone Number	7094000
Title of 12(b) Security	Ordinary shares
Trading Symbol	PRGO
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity small business	false
Entity emerging growth company	false
Entity Shell Company	false
Entity common stock, shares outstanding		133,714,781
Entity central index key	0001585364
Current calendar year end date	--12-31
Document calendar year focus	2021
Document calendar period focus	Q2
Amendment flag	false

XML

Condensed Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Income Statement [Abstract]
Net sales	$ 981.1	$ 948.8	$ 1,991.1	$ 2,032.0
Cost of sales	632.1	601.6	1,273.7	1,291.1
Gross profit	349.0	347.2	717.4	740.9
Operating expenses
Distribution	24.1	19.8	45.8	40.0
Research and development	33.0	30.4	64.1	58.3
Selling	139.8	119.3	275.2	258.9
Administration	110.4	114.3	237.6	233.9
Impairment charges	158.6	0.0	158.6	0.0
Restructuring	9.0	0.7	10.7	0.7
Total operating expenses	474.9	284.5	792.0	591.8
Operating income (loss)	(125.9)	62.7	(74.6)	149.1
Change in financial assets	0.0	(2.1)	0.0	(3.7)
Interest expense, net	31.6	32.2	63.6	61.1
Other (income) expense, net	(0.4)	17.1	1.9	18.8
Income (loss) from continuing operations before income taxes	(157.1)	15.5	(140.1)	72.9
Income tax expense (benefit)	(45.2)	3.1	(31.0)	2.8
Income (loss) from continuing operations	(111.9)	12.4	(109.1)	70.1
Income from discontinued operations, net of tax	54.2	48.2	89.5	96.9
Net income (loss)	$ (57.7)	$ 60.6	$ (19.6)	$ 167.0
Basic
Continuing operations (in dollars per share)	$ (0.84)	$ 0.09	$ (0.82)	$ 0.52
Discontinued operations (in dollars per share)	0.41	0.35	0.67	0.71
Basic earnings per share (in dollars per share)	(0.43)	0.44	(0.15)	1.23
Diluted
Continuing operations (in dollars per share)	(0.84)	0.09	(0.82)	0.51
Discontinued operations (in dollars per share)	0.41	0.35	0.67	0.71
Diluted earnings per share (in dollars per share)	$ (0.43)	$ 0.44	$ (0.15)	$ 1.22
Weighted-average shares outstanding
Basic (in shares)	133.6	136.4	133.4	136.3
Diluted (in shares)	133.6	137.5	133.4	137.3

XML

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ (57.7)	$ 60.6	$ (19.6)	$ 167.0
Other comprehensive income (loss):
Foreign currency translation adjustments	32.5	86.7	(79.1)	(5.5)
Change in fair value of derivative financial instruments, net of tax	(1.3)	(0.7)	(7.3)	(10.1)
Change in post-retirement and pension liability, net of tax	(0.8)	(1.2)	(1.5)	(3.1)
Other comprehensive income (loss), net of tax	30.4	84.8	(87.9)	(18.7)
Comprehensive income (loss)	$ (27.3)	$ 145.4	$ (107.5)	$ 148.3

XML

Condensed Consolidated Balance Sheets - USD ($) shares in Millions, $ in Millions	Jul. 03, 2021	Dec. 31, 2020
Assets
Cash and cash equivalents	$ 317.5	$ 631.5
Accounts receivable, net of allowance for credit losses of $7.7 and $6.5, respectively	620.2	593.5
Inventories	1,115.9	1,059.4
Prepaid expenses and other current assets	277.3	182.2
Current assets held for sale	2,089.3	666.9
Total current assets	4,420.2	3,133.5
Property, plant and equipment, net	833.8	864.6
Operating lease assets	171.3	154.7
Goodwill and indefinite-lived intangible assets	3,063.1	3,102.7
Definite-lived intangible assets, net	2,313.8	2,481.5
Deferred income taxes	49.0	40.6
Non-current assets held for sale	0.0	1,364.0
Other non-current assets	379.1	346.8
Total non-current assets	6,810.1	8,354.9
Total assets	11,230.3	11,488.4
Liabilities and Shareholders’ Equity
Accounts payable	402.4	451.6
Payroll and related taxes	106.2	152.9
Accrued customer programs	132.6	128.5
Other accrued liabilities	235.5	183.1
Accrued income taxes	9.4	9.0
Current indebtedness	630.1	37.3
Current liabilities held for sale	468.3	419.6
Total current liabilities	1,984.5	1,382.0
Long-term debt, less current portion	2,925.8	3,527.6
Deferred income taxes	254.9	276.2
Non-current liabilities held for sale	0.0	108.3
Other non-current liabilities	554.0	539.2
Total non-current liabilities	3,734.7	4,451.3
Total liabilities	5,719.2	5,833.3
Commitments and contingencies - Refer to Note 16
Controlling interests:
Preferred shares, $0.0001 par value per share, 10 shares authorized	0.0	0.0
Ordinary shares, €0.001 par value per share, 10,000 shares authorized	7,081.7	7,118.2
Accumulated other comprehensive income	307.1	395.0
Retained earnings (accumulated deficit)	(1,877.7)	(1,858.1)
Total shareholders’ equity	5,511.1	5,655.1
Total liabilities and shareholders' equity	$ 11,230.3	$ 11,488.4
Supplemental Disclosures of Balance Sheet Information
Preferred shares, issued and outstanding (in shares)	0.0	0.0
Ordinary shares, issued and outstanding (in shares)	133.6	133.1

XML

Condensed Consolidated Balance Sheets (Parenthetical) $ in Millions	Jul. 03, 2021 USD ($) $ / shares shares	Jul. 03, 2021 € / shares	Dec. 31, 2020 USD ($) $ / shares shares	Dec. 31, 2020 € / shares
Statement of Financial Position [Abstract]
Allowance for credit losses | $	$ 7.7		$ 6.5
Stockholders' Equity:
Preferred shares, par value (in dollars per share) | $ / shares	$ 0.0001		$ 0.0001
Preferred shares, authorized (shares)	10,000,000		10,000,000
Ordinary shares, par value (in EUR per share) | € / shares		€ 0.001		€ 0.001
Ordinary shares, authorized (shares)	10,000,000,000		10,000,000,000

XML

Condensed Consolidated Statements of Shareholders' Equity Statement - USD ($) shares in Millions, $ in Millions	Total	Ordinary Shares Issued	Accumulated Other Comprehensive Income	Retained Earnings (Accumulated Deficit)
Beginning balance (shares) at Dec. 31, 2019		136.1
Balance, beginning at Dec. 31, 2019	$ 5,803.8	$ 7,359.9	$ 139.4	$ (1,695.5)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	106.4			106.4
Other comprehensive loss	(103.5)		(103.5)
Restricted stock plan (shares)		0.3
Compensation for stock options	0.8	$ 0.8
Compensation for restricted stock	15.4	15.4
Cash dividends	(30.9)	$ (30.9)
Shares withheld for payment of employees' withholding tax liability (shares)		(0.1)
Shares withheld for payment of employees' withholding tax liability	(5.6)	$ (5.6)
Ending balance (shares) at Mar. 28, 2020		136.3
Balance, ending at Mar. 28, 2020	5,786.4	$ 7,339.6	35.9	(1,589.1)
Beginning balance (shares) at Dec. 31, 2019		136.1
Balance, beginning at Dec. 31, 2019	5,803.8	$ 7,359.9	139.4	(1,695.5)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	167.0
Other comprehensive loss	(18.7)
Ending balance (shares) at Jun. 27, 2020		136.5
Balance, ending at Jun. 27, 2020	5,910.4	$ 7,318.2	120.7	(1,528.5)
Beginning balance (shares) at Mar. 28, 2020		136.3
Balance, beginning at Mar. 28, 2020	5,786.4	$ 7,339.6	35.9	(1,589.1)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	60.6			60.6
Other comprehensive loss	84.8		84.8
Restricted stock plan (shares)		0.3
Compensation for stock options	0.4	$ 0.4
Compensation for restricted stock	13.1	13.1
Cash dividends	(31.0)	$ (31.0)
Shares withheld for payment of employees' withholding tax liability (shares)		(0.1)
Shares withheld for payment of employees' withholding tax liability	(3.9)	$ (3.9)
Ending balance (shares) at Jun. 27, 2020		136.5
Balance, ending at Jun. 27, 2020	5,910.4	$ 7,318.2	120.7	(1,528.5)
Beginning balance (shares) at Dec. 31, 2020		133.1
Balance, beginning at Dec. 31, 2020	5,655.1	$ 7,118.2	395.0	(1,858.1)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	38.1			38.1
Other comprehensive loss	(118.3)		(118.3)
Restricted stock plan (shares)		0.6
Compensation for stock options	0.4	$ 0.4
Compensation for restricted stock	24.6	24.6
Cash dividends	(32.6)	$ (32.6)
Shares withheld for payment of employees' withholding tax liability (shares)		(0.2)
Shares withheld for payment of employees' withholding tax liability	(9.3)	$ (9.3)
Ending balance (shares) at Apr. 03, 2021		133.5
Balance, ending at Apr. 03, 2021	5,558.0	$ 7,101.3	276.7	(1,820.0)
Beginning balance (shares) at Dec. 31, 2020		133.1
Balance, beginning at Dec. 31, 2020	5,655.1	$ 7,118.2	395.0	(1,858.1)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(19.6)
Other comprehensive loss	(87.9)
Ending balance (shares) at Jul. 03, 2021		133.6
Balance, ending at Jul. 03, 2021	5,511.1	$ 7,081.7	307.1	(1,877.7)
Beginning balance (shares) at Apr. 03, 2021		133.5
Balance, beginning at Apr. 03, 2021	5,558.0	$ 7,101.3	276.7	(1,820.0)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(57.7)			(57.7)
Other comprehensive loss	30.4		30.4
Restricted stock plan (shares)		0.1
Compensation for stock options	0.2	$ 0.2
Compensation for restricted stock	13.9	13.9
Cash dividends	(32.5)	$ (32.5)
Shares withheld for payment of employees' withholding tax liability (shares)		0.0
Shares withheld for payment of employees' withholding tax liability	(1.2)	$ (1.2)
Ending balance (shares) at Jul. 03, 2021		133.6
Balance, ending at Jul. 03, 2021	$ 5,511.1	$ 7,081.7	$ 307.1	$ (1,877.7)

XML

Condensed Consolidated Statements of Shareholders' Equity (Parenthetical) - $ / shares	3 Months Ended
	Jul. 03, 2021	Apr. 03, 2021	Jun. 27, 2020	Mar. 28, 2020
Statement of Stockholders' Equity [Abstract]
Dividends paid (in dollars per share)	$ 0.24	$ 0.24	$ 0.23	$ 0.23

XML

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020
Cash Flows From (For) Operating Activities
Net income (loss)	$ (19,600)	$ 167,000
Adjustments to derive cash flows:
Depreciation and amortization	165,300	187,800
Loss (Gain) on sale of business	0	17,400
Share-based compensation	39,100	29,700
Impairment charges	158,600	0
Change in financial assets	0	(3,700)
Restructuring charges	10,700	1,100
Deferred income taxes	(25,400)	11,700
Amortization of debt premium	(1,400)	(1,300)
Other non-cash adjustments, net	18,800	(11,500)
Subtotal	346,100	398,200
Increase (decrease) in cash due to:
Accounts receivable	(108,200)	227,900
Inventories	(106,000)	(38,600)
Prepaid expenses	1,800	(32,400)
Accounts payable	(22,500)	(21,600)
Payroll and related taxes	(61,100)	(20,400)
Accrued customer programs	4,300	(31,900)
Accrued liabilities	(32,100)	(7,900)
Accrued income taxes	(135,600)	(12,800)
Other, net	31,200	2,200
Subtotal	(428,200)	64,500
Net cash from (for) operating activities	(82,100)	462,700
Cash Flows From (For) Investing Activities
Proceeds from royalty rights	1,900	2,400
Purchase of equity method investment	0	(15,000)
Acquisitions of businesses, net of cash acquired	0	(106,000)
Asset acquisitions	(70,600)	(32,800)
Additions to property, plant and equipment	(68,400)	(60,100)
Net proceeds from sale of business	0	187,800
Other investing, net	1,300	2,000
Net cash from (for) investing activities	(135,800)	(21,700)
Cash Flows From (For) Financing Activities
Issuances of long-term debt	0	743,800
Borrowings (repayments) of revolving credit agreements and other financing, net	(5,800)	1,600
Deferred financing fees	0	(5,000)
Cash dividends	(65,100)	(61,900)
Other financing, net	(13,500)	(11,700)
Net cash from (for) financing activities	(84,400)	666,800
Effect of exchange rate changes on cash and cash equivalents	(3,200)	(5,800)
Net increase (decrease) in cash and cash equivalents	(305,500)	1,102,000
Cash and cash equivalents of continuing operations, beginning of period	631,500	344,500
Cash and cash equivalents held for sale, beginning of period	10,000	9,800
Less cash and cash equivalents held for sale, end of period	(18,500)	(18,700)
Cash and cash equivalents of continuing operations, end of period	$ 317,500	$ 1,437,600

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Summary of Significant Accounting Policies

6 Months Ended

Jul. 03, 2021

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

General Information

The Company

Perrigo Company plc was incorporated under the laws of Ireland on June 28, 2013 and became the successor registrant of Perrigo Company, a Michigan corporation, on December 18, 2013 in connection with the acquisition of Elan Corporation, plc ("Elan"). Unless the context requires otherwise, the terms "Perrigo," the "Company," "we," "our," "us," and similar pronouns used herein refer to Perrigo Company plc, its subsidiaries, and all predecessors of Perrigo Company plc and its subsidiaries.

Our vision is to make lives better by bringing Quality, Affordable Self-Care Products that consumers trust everywhere they are sold. We are a leading provider of over-the-counter ("OTC") health and wellness solutions that enhance individual well-being by empowering consumers to proactively prevent or treat conditions that can be self-managed.

Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") for interim financial information and with the instructions to Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and footnotes included in our Annual Report on Form 10-K for the year ended December 31, 2020. In the opinion of management, all adjustments (consisting of normal recurring accruals and other adjustments) considered necessary for a fair presentation of the unaudited Condensed Consolidated Financial Statements have been included and include our accounts and the accounts of all majority-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.

On March 1, 2021, we announced a definitive agreement to sell our generic RX Pharmaceuticals business ("RX business") to Altaris Capital Partners, LLC ("Altaris"). On July 6, 2021, we completed the sale of the RX business. The financial results of our RX business, which were previously reported in our Prescription Pharmaceuticals ("RX") segment, have been classified as discontinued operations in the Condensed Consolidated Statements of Operations for all periods presented. The assets and liabilities of our RX business are reflected as assets and liabilities held for sale in the Condensed Consolidated Balance Sheets for all periods presented. Refer to Note 8 for additional information regarding discontinued operations. Unless otherwise noted, amounts and disclosures throughout the Notes to the unaudited Condensed Consolidated Financial Statements relate to our continuing operations.

Segment Reporting

Our reporting and operating segments are as follows:

•Consumer Self-Care Americas ("CSCA") comprises our consumer self-care business (OTC, infant formula, and oral self-care categories, and contract manufacturing) in the U.S., Mexico and Canada.

•Consumer Self-Care International ("CSCI") comprises our consumer self-care business primarily branded in Europe and Australia, our store brand business in the United Kingdom and parts of Europe and Asia, and our liquid licensed products business in the United Kingdom until it was disposed on June 19, 2020.

Allowance for Credit Losses

Expected credit losses on trade receivables and contract assets are measured collectively by geographic location. The estimate of expected credit losses considers historical credit loss information that is adjusted for current conditions and for reasonable and supportable forecasts. Historical credit loss experience provides the primary basis for estimation of expected credit losses. Adjustments to historical loss information may be made for

significant changes in a geographic location’s economic conditions. Receivables that do not share risk characteristics are evaluated on an individual basis. These receivables are not included in the collective evaluation.

The allowance for credit losses is a valuation account that is deducted from the instruments’ cost basis to present the net amount expected to be collected. Trade receivables and contract assets are charged off against the allowance when the balance is no longer deemed collectible.

The following table presents the allowance for credit losses activity (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Beginning balance	$	9.1	$	6.2	$	6.5	$	6.0
Provision for credit losses, net	0.4		0.1		3.7		0.7
Receivables written-off	(0.6)		(0.9)		(0.9)		(1.1)
Recoveries collected	—		—		—		—
Transfer to held for sale	(1.4)		—		(1.4)		—
Currency translation adjustment	0.2		0.1		(0.2)		(0.1)
Ending balance	$	7.7	$	5.5	$	7.7	$	5.5

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Revenue Recognition

6 Months Ended

Jul. 03, 2021

Revenue from Contract with Customer [Abstract]

Revenue Recognition

REVENUE RECOGNITION

Revenue is recognized when or as a customer obtains control of promised products. The amount of revenue recognized reflects the consideration we expect to be entitled to receive in exchange for these products.

Disaggregation of Revenue

We generated net sales in the following geographic locations(1) (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
U.S.	$	590.3	$	604.0	$	1,201.6	$	1,274.6
Europe(2)	348.1		311.8		704.1		684.4
All other countries(3)	42.7		33.0		85.4		73.0
Total net sales	$	981.1	$	948.8	$	1,991.1	$	2,032.0

(1) Derived from the location of the entity that sells to a third party.

(2) Includes Ireland net sales of $5.3 million and $9.8 million for the three and six months ended July 3, 2021 respectively, and $7.8 million and $11.5 million for the three and six months ended June 27, 2020, respectively.

(3) Includes net sales generated primarily in Mexico, Australia and Canada.

Product Category

The following is a summary of our net sales by category (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
CSCA(1)
Upper respiratory	$	102.4	$	116.7	$	216.4	$	271.3
Digestive health	110.4		112.1		223.9		219.0
Nutrition	95.6		88.6		187.6		190.8
Pain and sleep-aids	87.1		97.7		179.5		218.1
Oral self-care	74.5		63.2		148.2		118.5
Healthy lifestyle	63.6		81.5		139.1		167.3
Skincare and personal hygiene	52.9		42.9		106.2		89.6
Vitamins, minerals, and supplements	8.4		6.4		16.2		12.8
Other CSCA(2)	27.4		18.6		45.7		40.8
Total CSCA	622.3		627.7		1,262.8		1,328.2
CSCI
Skincare and personal hygiene	112.4		97.6		219.4		192.3
Vitamins, minerals, and supplements	49.1		38.5		108.1		87.0
Healthy lifestyle	48.0		40.5		98.3		84.1
Pain and sleep-aids	47.3		40.2		96.3		87.0
Upper respiratory	42.6		45.5		85.5		129.6
Oral self-care	22.5		20.4		48.0		43.6
Digestive health	9.7		5.1		18.2		11.1
Other CSCI(3)	27.2		33.3		54.5		69.1
Total CSCI	358.8		321.1		728.3		703.8
Total net sales	$	981.1	$	948.8	$	1,991.1	$	2,032.0

(1) Includes net sales from our OTC contract manufacturing business.

(2) Consists primarily of diagnostic and other miscellaneous or otherwise uncategorized product lines and markets, none of which is greater than 10% of the segment net sales.

(3) Consists primarily of our distribution business and other miscellaneous or otherwise uncategorized product lines and markets, none of which is greater than 10% of the segment net sales.

While the majority of revenue is recognized at a point in time, certain of our product revenue is recognized on an over time basis. Predominately, over time customer contracts exist in contract manufacturing arrangements, which occur in both the CSCA and CSCI segments. Contract manufacturing revenue was $69.8 million and $132.9 million for the three and six months ended July 3, 2021, respectively and $64.5 million and $113.7 million for the three and six months ended June 27, 2020, respectively.

We also recognize a portion of the store brand OTC product revenues in the CSCA segment on an over time basis; however, the timing difference between over time and point in time revenue recognition for store brand contracts is not significant due to the short time period between the customization of the product and shipment or delivery.

Contract Balances

The following table provides information about contract assets from contracts with customers (in millions):

	Balance Sheet Location	July 3, 2021		December 31, 2020
Short-term contract assets	Prepaid expenses and other current assets	$	22.4	$	19.7

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Acquisitions and Divestitures

6 Months Ended

Jul. 03, 2021

Business Combination and Asset Acquisition [Abstract]

Acquisitions and Divestitures

ACQUISITIONS AND DIVESTITURES

Acquisitions Accounted for as a Business Combination During the Year Ended December 31, 2020

Eastern European OTC Dermatological Brands Acquisition

On October 30, 2020, we acquired three Eastern European OTC dermatological brands ("Eastern European Brands"), skincare brands Emolium® and Iwostin® and hair loss treatment brand Loxon®, from Sanofi. The transaction closed for €53.3 million ($62.3 million). We capitalized $52.5 million as brand-named intangible assets and allocated the remainder of the purchase price to goodwill, inventory, customer relationships and deferred tax assets.

The addition of these market-leading OTC brands complements our already robust skincare portfolio and adds scale to our Eastern European business. The acquisition also serves as another step for Perrigo’s CSCI growth plans and provides new opportunities for self-care revenue synergy in the European markets. The operating results of the brands are reported within our CSCI segment. The acquisition of the Eastern European Brands was accounted for as a business combination and has been reported in our Consolidated Statements of Operations as of the acquisition date.

The goodwill arising from the acquisition consists largely of the assembled workforce, and the cost and revenue synergies expected from integrating the business into the CSCI segment. The goodwill was allocated to our CSCI segment, none of which is deductible for income tax purposes. The definite-lived intangible assets acquired consisted of brands and customer relationships which are being amortized over a weighted average useful life of approximately 18.8 years. Both the brands and customer relationships were valued using the multi-period excess earnings method. Significant judgment was applied in estimating the fair value of the intangible assets acquired, which involved the use of significant estimates and assumptions with respect to the timing and amounts of cash flow projections, including revenue growth rates, projected profit margins, and discount rates. The opening balance sheet is final.

Oral Care Assets of High Ridge Brands

On April 1, 2020, we acquired the oral care assets of High Ridge Brands ("Dr. Fresh") for total purchase consideration of $113.0 million, subject to customary adjustments, including a working capital settlement. After such adjustments as of December 31, 2020, total cash consideration paid was $106.2 million net of $2.0 million that we allocated as prepayment of contract consideration for transitional services to be received related to the transaction.

This acquisition includes the children’s oral care value brand, Firefly®, in addition to the REACH® and Dr. Fresh® brands, and a licensing portfolio. The U.S. operations, which represent a significant portion of the business, are reported in our CSCA segment and the non-U.S. operations are reported in our CSCI segment.

The following table summarizes the consideration paid for Dr. Fresh and the amounts of the assets acquired and liabilities assumed (in millions):

	Oral Care Assets of High Ridge Brands (Dr. Fresh)
Purchase price paid	$	106.2
Assets acquired:
Accounts receivable	13.1
Inventories	22.2
Prepaid expenses and other current assets	0.4
Property, plant and equipment, net	0.7
Operating lease assets	2.6
Goodwill	17.2
Distribution and license agreements and supply agreements	$	2.2
Developed product technology, formulations, and product rights	0.1
Customer relationships and distribution networks	20.6
Trademarks, trade names, and brands	43.2
Total intangible assets	$	66.1
Total assets	$	122.3
Liabilities assumed:
Accounts payable	$	6.1
Other accrued liabilities	3.8
Payroll and related taxes	0.7
Accrued customer programs	3.0
Other non-current liabilities	2.5
Total liabilities	$	16.1
Net assets acquired	$	106.2

The goodwill of $17.2 million arising from the acquisition consists largely of the anticipated growth from new product sales, sales to new customers, the assembled workforce, and the synergies expected from combining the operations of Dr. Fresh into Perrigo. The goodwill is attributable to our CSCA segment and is tax deductible for income tax purposes. The definite-lived intangible assets acquired consisted of trademarks and trade names, license agreements, and customer relationships, which are being amortized over a weighted average useful life of approximately 17.8 years. Customer relationships were valued using the multi-period excess earnings method. Trademarks and trade names and developed technology were valued using the relief from royalty method. Significant judgment was applied in estimating the fair value of the intangible assets acquired, which involved the use of significant estimates and assumptions with respect to the timing and amounts of cash flow projections, including revenue growth rates, projected profit margins, and discount rates. The opening balance sheet is final.

Pro Forma Impact of Business Combinations

The following table presents unaudited pro forma information as if the acquisitions of Dr. Fresh and the Eastern European Brands occurred on January 1, 2019, and had been combined with the results reported in our Condensed Consolidated Statements of Operations for all periods presented (in millions):

	Three Months Ended		Six Months Ended
(Unaudited)	June 27, 2020		June 27, 2020
Net sales	$	955.0	$	2,074.1
Income from continuing operations	$	17.6	$	80.2

The unaudited pro forma information is presented for information purposes only and is not indicative of the results that would have been achieved if the acquisition had taken place at such time. The unaudited pro forma information presented above includes adjustments primarily for amortization charges for acquired intangible assets, depreciation of property, plant and equipment that have been revalued, certain acquisition-related charges, and related tax effects.

Acquisitions During the Six Months Ended June 27, 2020

Dexsil®

On February 13, 2020, we acquired Dexsil®, a silicon supplement brand, from RXW Group Nv, for total cash consideration paid of approximately $8.0 million. The transaction was accounted for as an asset acquisition, in which we capitalized the consideration paid as a brand-named intangible asset. We began amortizing the brand intangible over a 25-year useful life. Operating results attributable to the product are included within our CSCI segment.

Steripod®

On January 3, 2020, we acquired Steripod®, a leading toothbrush accessory brand and innovator in the toothbrush protector market, from Bonfit America Inc. Total consideration paid was $26.0 million. The transaction was accounted for as an asset acquisition, in which we capitalized $25.1 million as a brand-named intangible asset. The remainder of the purchase price was allocated to working capital. We began amortizing the brand intangible asset over a 25-year useful life. Operating results attributable to Steripod® are included within our CSCA segment.     

Divestitures During the Six Months Ended June 27, 2020

Rosemont Pharmaceuticals Business

On June 19, 2020, we completed the sale of our U.K.-based Rosemont Pharmaceuticals business, a generic prescription pharmaceuticals manufacturer focused on liquid medicines, to a U.K.-headquartered private equity firm for cash consideration of £155.6 million (approximately $195.0 million). The sale resulted in a pre-tax loss of $17.4 million during the three and six months ended June 27, 2020, $1.3 million during the three months ended September 26, 2020 and $2.4 million during the three months ended December 31, 2020. These losses were recorded in our CSCI segment in Other (income) expense, net on the Consolidated Statements of Operations. These losses included professional fees and a $46.4 million write-off of foreign currency translation adjustment from Accumulated other comprehensive income.

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Goodwill and Intangible Assets

6 Months Ended

Jul. 03, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangible Assets

GOODWILL AND INTANGIBLE ASSETS

Goodwill

Changes in the carrying amount of goodwill, by reportable segment, were as follows (in millions):

	December 31, 2020		Purchase accounting adjustments		Impairments		Currency translation adjustments		July 3, 2021
CSCA(1)	$	1,905.0	$	2.4	$	(6.1)	$	(0.1)	$	1,901.2
CSCI(2)	1,190.7		(2.4)		—		(32.7)		1,155.6
Total goodwill	$	3,095.7	$	—	$	(6.1)	$	(32.8)	$	3,056.8

(1) We had no accumulated goodwill impairments as of December 31, 2020 and $6.1 million as of July 3, 2021.

(2) We had accumulated goodwill impairments of $868.4 million as of December 31, 2020 and July 3, 2021.

CSCA Reporting Unit Goodwill

On May 18, 2021, we announced a definitive agreement to sell our Mexico and Brazil-based OTC businesses ("Latin American businesses"), both within our CSCA segment, to Advent International. As a result, we prepared a goodwill impairment test. We determined the carrying value of this business exceeded the fair value and recorded an impairment of $6.1 million within our CSCA segment during the three months ended July 3, 2021 (refer to Note 6 and Note 9).

Intangible Assets

Intangible assets and related accumulated amortization consisted of the following (in millions):

	July 3, 2021				December 31, 2020
	Gross		Accumulated Amortization		Gross		Accumulated Amortization
Indefinite-lived intangibles:
Trademarks, trade names, and brands	$	3.6	$	—	$	4.3	$	—
In-process research and development	2.7		—		2.7		—
Total indefinite-lived intangibles	$	6.3	$	—	$	7.0	$	—
Definite-lived intangibles:
Distribution and license agreements and supply agreements	$	69.4	$	51.7	$	74.8	$	55.4
Developed product technology, formulations, and product rights	302.0		184.5		303.3		177.3
Customer relationships and distribution networks	1,877.9		863.7		1,920.5		823.7
Trademarks, trade names, and brands	1,534.0		369.6		1,581.5		342.2
Non-compete agreements	2.1		2.1		2.9		2.9
Total definite-lived intangibles	$	3,785.4	$	1,471.6	$	3,883.0	$	1,401.5
Total intangible assets	$	3,791.7	$	1,471.6	$	3,890.0	$	1,401.5

We recorded amortization expense of $53.4 million and $106.6 million for the three and six months ended July 3, 2021, respectively, and $51.6 million and $104.2 million for the three and six months ended June 27, 2020, respectively.

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Inventories

6 Months Ended

Jul. 03, 2021

Inventory Disclosure [Abstract]

Inventories

INVENTORIES

Major components of inventory were as follows (in millions):

 

	July 3, 2021		December 31, 2020
Finished goods	$	607.5	$	574.1
Work in process	241.0		220.4
Raw materials	267.4		264.9
Total inventories	$	1,115.9	$	1,059.4

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Fair Value Measurements

6 Months Ended

Jul. 03, 2021

Fair Value Disclosures [Abstract]

Fair Value Measurements

FAIR VALUE MEASUREMENTS

The table below summarizes the valuation of our financial instruments carried at fair value by the applicable pricing categories (in millions):

	July 3, 2021						December 31, 2020
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Measured at fair value on a recurring basis:
Assets:
Investment securities	$	1.6	$	—	$	—	$	2.5	$	—	$	—
Foreign currency forward contracts	—		5.7		—		—		9.8		—
Cross-currency swap	—		4.2		—		—		6.3		—
Total assets	$	1.6	$	9.9	$	—	$	2.5	$	16.1	$	—
Liabilities:
Foreign currency forward contracts	$	—	$	2.7	$	—	$	—	$	7.9	$	—
Total liabilities	$	—	$	2.7	$	—	$	—	$	7.9	$	—
Measured at fair value on a non-recurring basis:
Assets:
Assets held for sale, net(1)	$	—	$	—	$	1,621.0	$	—	$	—	$	—
Total assets	$	—	$	—	$	1,621.0	$	—	$	—	$	—

(1)     We measured the assets held for sale for impairment purposes and recorded a total impairment of $158.6 million (refer to Note 9).

There were no transfers within Level 3 fair value measurements during the three and six months ended July 3, 2021 or the year ended December 31, 2020.

Royalty Pharma Contingent Milestone Receipts

During the year ended December 31, 2020, Royalty Pharma payments from Biogen for Tysabri® sales, as defined in the agreement between the parties, did not exceed the 2020 global net sales threshold. Therefore, we were not entitled to receive the remaining contingent milestone payment. As of December 31, 2020, there were no contingent milestone payments outstanding.

The table below summarizes the change in fair value of the Royalty Pharma contingent milestone (in millions):

	Three Months Ended		Six Months Ended
	June 27, 2020		June 27, 2020
Beginning balance	$	96.9	$	95.3
Change in fair value	2.1		3.7
Ending balance	$	99.0	$	99.0

We valued our contingent milestone payment from Royalty Pharma using a modified Black-Scholes Option Pricing Model ("BSOPM"). Key inputs in the BSOPM are the estimated volatility and rate of return of royalties on global net sales of Tysabri® that are received by Royalty Pharma until the contingent milestones are resolved. As of June 27, 2020, volatility and the estimated fair value of the milestones had a positive relationship such that higher volatility translates to a higher estimated fair value of the contingent milestone payments. Rate of return and the estimated fair value of the milestones had an inverse relationship, such that a lower rate of return correlates with a higher estimated fair value of the contingent milestone payments. We assessed volatility and rate of return inputs quarterly by analyzing certain market volatility benchmarks and the risk associated with Royalty Pharma achieving the underlying projected royalties. The table below represents the volatility and rate of return:

	Three Months Ended
	June 27, 2020
Volatility	37.5	%
Rate of return	6.91	%

During the three and six months ended June 27, 2020, the fair value of the Royalty Pharma contingent milestone payment related to 2020 increased by $2.1 million and $3.7 million,respectively, to $99.0 million, driven by higher volatility, higher projected global net sales of Tysabri® compared to the estimates in the prior period, and the estimated probability of achieving the earn-out. As of December 31, 2020, there were no contingent milestone payments outstanding and, accordingly, no asset recorded in the Condensed Consolidated Balance Sheet.

Non-recurring Fair Value Measurements

The non-recurring fair values represent only those assets whose carrying values were adjusted to fair value during the reporting period.

Goodwill

During the three months ended July 3, 2021, as a result of our definitive agreement to sell our Latin American businesses, we prepared a goodwill impairment test. We determined the carrying value of this business exceeded the fair value and recorded an impairment in the CSCA segment (refer to Note 4).

Assets held for sale, net

During the three months ended July 3, 2021, as a result of our definitive agreement to sell our Latin American businesses, we prepared an impairment test on the net assets held for sale related to this business. We determined the carrying value of the net assets held for sale exceed the fair value less cost to sell and recorded an impairment in the CSCA segment (refer to Note 9).

Fixed Rate Long-term Debt    

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

	July 3, 2021				December 31, 2020
	Level 1		Level 2		Level 1		Level 2
Public Bonds
Carrying Value (excluding discount)	$	2,760.0	$	—	$	2,760.0	$	—
Fair value	$	2,946.3	$	—	$	3,031.1	$	—
Private placement note
Carrying value (excluding premium)	$	—	$	160.2	$	—	$	164.9
Fair value	$	—	$	172.0	$	—	$	177.5

The fair values of our public bonds for all periods were based on quoted market prices. The fair values of our private placement note for all periods were based on interest rates offered for borrowings of a similar nature and remaining maturities.

The carrying amounts of our other financial instruments, consisting of cash and cash equivalents, accounts receivable, accounts payable, short-term debt, revolving credit agreements, promissory notes related to our equity method investment in Kazmira, and variable rate long-term debt, approximate their fair value.

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Investments

6 Months Ended

Jul. 03, 2021

Investments [Abstract]

Investments

INVESTMENTS

The following table summarizes the measurement category, balance sheet location, and balances of our equity securities (in millions):

Measurement Category	Balance Sheet Location	July 3, 2021		December 31, 2020
Fair value method	Prepaid expenses and other current assets	$	1.6	$	2.5
Fair value method(1)	Other non-current assets	$	1.7	$	1.9
Equity method	Other non-current assets	$	69.1	$	69.8

(1)     Measured at fair value using the Net Asset Value practical expedient.

The following table summarizes the expense (income) recognized in earnings of our equity securities (in millions):

		Three Months Ended				Six Months Ended
Measurement Category	Income Statement Location	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Fair value method	Other (income) expense, net	$	0.9	$	(0.4)	$	0.9	$	2.5
Equity method	Other (income) expense, net	$	—	$	(0.8)	$	0.7	$	(1.5)

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Discontinued Operations

6 Months Ended

Jul. 03, 2021

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

DISCONTINUED OPERATIONS

Our discontinued operations primarily consist of our RX segment, which held our prescription pharmaceuticals business in the U.S. and our pharmaceuticals and diagnostic businesses in Israel (collectively, the “RX business”).

On March 1, 2021, we announced a definitive agreement to sell our RX business to Altaris. On July 6, 2021, we completed the sale of the RX business for aggregate consideration of $1.55 billion, subject to customary adjustments for cash, debt, working capital and certain transaction expenses. The consideration includes approximately $53.0 million of reimbursements which Altaris will be required to deliver in cash to Perrigo pursuant to the terms of the Agreement.

As of March 1, 2021, we determined that the RX business met the criteria to be classified as a discontinued operation and, as a result, its historical financial results have been reflected in our consolidated financial statements as a discontinued operation and its assets and liabilities have been classified as held for sale. We ceased recording depreciation and amortization on the RX business assets from March 1, 2021. We have not allocated any general corporate overhead to the discontinued operation.

Under the terms of the agreement, we will provide transition services for up to 24 months after the close of the transaction and also enter into a reciprocal supply agreement pursuant to which Perrigo will supply certain products to the RX business and the RX business will supply certain products to Perrigo. The supply agreements have a term of four years, extendable up to seven years by the party who is the purchaser of the products under such agreement. We will also extend distribution rights to the RX business for certain OTC products owned and manufactured by Perrigo that may be fulfilled through pharmacy channels, in return for a share of the net profits.

The agreement provides that Perrigo will retain certain pre-closing liabilities arising out of antitrust (refer to Note 16 - Contingencies under the header "Price-Fixing Lawsuits") and opioid matters and the Company’s Albuterol recall, subject to, in each case, the buyer's obligation to indemnify the Company for fifty percent of these liabilities up to an aggregate cap on the buyer's obligation of $50.0 million.

Income from discontinued operations, net of tax was as follows (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Net sales	$	204.5	$	270.4	$	404.5	$	528.1
Cost of sales	119.9		180.6		258.2		346.4
Gross profit	84.6		89.8		146.3		181.7
Operating expenses
Distribution	2.8		3.8		6.1		7.8
Research and development	17.3		16.4		30.6		30.1
Selling	8.8		7.4		16.2		14.7
Administration	12.4		8.1		30.6		14.5
Restructuring	—		0.4		—		0.4
Other operating expense (income)	0.5		(0.9)		(0.4)		0.2
Total operating expenses	41.8		35.2		83.1		67.7
Operating income (loss)	$	42.8	$	54.6	63.2		114.0
Interest expense, net	0.2		1.1		0.8		2.5
Other (income) expense, net	(0.2)		(2.9)		(1.7)		(2.1)
Income before income taxes	42.8		56.4		64.1		113.6
Income tax expense (benefit)	(11.4)		8.2		(25.4)		16.7
Income from discontinued operations, net of tax	$	54.2	$	48.2	$	89.5	$	96.9

During the three and six months ended July 3, 2021, we incurred $2.4 million and $11.7 million, respectively, of separation costs related to the sale of the RX business, which are recorded in administration expenses.

Select cash flow information related to discontinued operations was as follows (in millions):

	Six Months Ended
	July 3, 2021		June 27, 2020
Cash flows from discontinued operations operating activities:
Depreciation and amortization	$	15.3	$	48.2
Cash flows from discontinued operations investing activities:
Asset acquisitions	$	(69.7)	$	(0.1)
Additions to property, plant and equipment	$	(6.1)	$	(5.6)

Asset acquisitions related to discontinued operations consisted of two ANDAs purchased under a contractual arrangement entered into on May 15, 2015 with a third party that specializes in research and development and obtaining approval for various drug candidates to develop specific products. On December 31, 2020, we purchased an ANDA for a generic topical gel for $16.4 million, which was subsequently paid during the three months ended April 3, 2021 and on March 8, 2021, we purchased an ANDA for a generic topical lotion for $53.3 million. The generic topical lotion acquisition was assumed by Altaris in connection with the sale of the RX business.

The assets and liabilities classified as held for sale related to discontinued operations were as follows (in millions):

	July 3, 2021		December 31, 2020
Cash and cash equivalents	$	9.3	$	10.0
Accounts receivable, net of allowance for credit losses of $1.0 and $1.1, respectively	496.4		460.7
Inventories	143.4		140.8
Prepaid expenses and other current assets	21.4		55.4
Current assets held for sale*			666.9
Property, plant and equipment, net	133.3		131.4
Operating lease assets	30.0		31.3
Goodwill and indefinite-lived intangible assets	680.0		681.2
Definite-lived intangible assets, net	532.9		492.8
Deferred income taxes	4.2		3.6
Other non-current assets	22.6		23.7
Non-current assets held for sale*			1,364.0
Total assets held for sale	$	2,073.5	$	2,030.9
Accounts payable	$	91.6	$	92.2
Payroll and related taxes	14.1		22.3
Accrued customer programs	235.6		237.4
Other accrued liabilities	27.4		67.2
Accrued income taxes	0.1		—
Current indebtedness	0.5		0.5
Current liabilities held for sale*			419.6
Long-term debt, less current portion	0.4		0.7
Deferred income taxes	3.2		3.1
Other non-current liabilities	64.6		104.5
Non-current liabilities held for sale*			108.3
Total liabilities held for sale	$	437.5	$	527.9

*The non-current assets and liabilities of the RX business have been reclassified to current assets and liabilities held for sale, respectively, and the sale was completed on July 6, 2021.

ASSETS HELD FOR SALE

We classify assets as "held for sale" when, among other factors, management approves and commits to a formal plan of sale with the expectation the sale will be completed within one year. The net assets of the business held for sale are then recorded at the lower of their current carrying value and the fair market value, less costs to sell.

During the three months ended July 3, 2021, management committed to a plan to sell our Latin American businesses; as a result, such assets were classified as held for sale. The assets associated with this business were reported within our CSCA segment. The sale is expected to close in the second half of 2021. At July 3, 2021, we determined the carrying value of the net assets held for sale of this business exceeded their fair value less cost to sell, resulting in an impairment charge of $152.5 million. We also recorded a goodwill impairment charge of $6.1 million within our CSCA segment, related to the Latin American businesses (refer to Note 4), resulting in a total impairment charge of $158.6 million.

In addition to the assets and liabilities held for sale related to discontinued operations (refer to Note 8), the assets and liabilities held for sale related to the Latin American businesses were reported within Current assets held for sale and Current liabilities held for sale on the Condensed Consolidated Balance Sheets. Net of impairment

charges, the assets and liabilities of the Latin American businesses reported as held for sale as of July 3, 2021 totaled $15.8 million and $30.8 million, respectively.

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Discontinued Operations and Disposal Groups

6 Months Ended

Jul. 03, 2021

Discontinued Operations and Disposal Groups [Abstract]

Assets Held for Sale

DISCONTINUED OPERATIONS

Our discontinued operations primarily consist of our RX segment, which held our prescription pharmaceuticals business in the U.S. and our pharmaceuticals and diagnostic businesses in Israel (collectively, the “RX business”).

On March 1, 2021, we announced a definitive agreement to sell our RX business to Altaris. On July 6, 2021, we completed the sale of the RX business for aggregate consideration of $1.55 billion, subject to customary adjustments for cash, debt, working capital and certain transaction expenses. The consideration includes approximately $53.0 million of reimbursements which Altaris will be required to deliver in cash to Perrigo pursuant to the terms of the Agreement.

As of March 1, 2021, we determined that the RX business met the criteria to be classified as a discontinued operation and, as a result, its historical financial results have been reflected in our consolidated financial statements as a discontinued operation and its assets and liabilities have been classified as held for sale. We ceased recording depreciation and amortization on the RX business assets from March 1, 2021. We have not allocated any general corporate overhead to the discontinued operation.

Under the terms of the agreement, we will provide transition services for up to 24 months after the close of the transaction and also enter into a reciprocal supply agreement pursuant to which Perrigo will supply certain products to the RX business and the RX business will supply certain products to Perrigo. The supply agreements have a term of four years, extendable up to seven years by the party who is the purchaser of the products under such agreement. We will also extend distribution rights to the RX business for certain OTC products owned and manufactured by Perrigo that may be fulfilled through pharmacy channels, in return for a share of the net profits.

The agreement provides that Perrigo will retain certain pre-closing liabilities arising out of antitrust (refer to Note 16 - Contingencies under the header "Price-Fixing Lawsuits") and opioid matters and the Company’s Albuterol recall, subject to, in each case, the buyer's obligation to indemnify the Company for fifty percent of these liabilities up to an aggregate cap on the buyer's obligation of $50.0 million.

Income from discontinued operations, net of tax was as follows (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Net sales	$	204.5	$	270.4	$	404.5	$	528.1
Cost of sales	119.9		180.6		258.2		346.4
Gross profit	84.6		89.8		146.3		181.7
Operating expenses
Distribution	2.8		3.8		6.1		7.8
Research and development	17.3		16.4		30.6		30.1
Selling	8.8		7.4		16.2		14.7
Administration	12.4		8.1		30.6		14.5
Restructuring	—		0.4		—		0.4
Other operating expense (income)	0.5		(0.9)		(0.4)		0.2
Total operating expenses	41.8		35.2		83.1		67.7
Operating income (loss)	$	42.8	$	54.6	63.2		114.0
Interest expense, net	0.2		1.1		0.8		2.5
Other (income) expense, net	(0.2)		(2.9)		(1.7)		(2.1)
Income before income taxes	42.8		56.4		64.1		113.6
Income tax expense (benefit)	(11.4)		8.2		(25.4)		16.7
Income from discontinued operations, net of tax	$	54.2	$	48.2	$	89.5	$	96.9

During the three and six months ended July 3, 2021, we incurred $2.4 million and $11.7 million, respectively, of separation costs related to the sale of the RX business, which are recorded in administration expenses.

Select cash flow information related to discontinued operations was as follows (in millions):

	Six Months Ended
	July 3, 2021		June 27, 2020
Cash flows from discontinued operations operating activities:
Depreciation and amortization	$	15.3	$	48.2
Cash flows from discontinued operations investing activities:
Asset acquisitions	$	(69.7)	$	(0.1)
Additions to property, plant and equipment	$	(6.1)	$	(5.6)

Asset acquisitions related to discontinued operations consisted of two ANDAs purchased under a contractual arrangement entered into on May 15, 2015 with a third party that specializes in research and development and obtaining approval for various drug candidates to develop specific products. On December 31, 2020, we purchased an ANDA for a generic topical gel for $16.4 million, which was subsequently paid during the three months ended April 3, 2021 and on March 8, 2021, we purchased an ANDA for a generic topical lotion for $53.3 million. The generic topical lotion acquisition was assumed by Altaris in connection with the sale of the RX business.

The assets and liabilities classified as held for sale related to discontinued operations were as follows (in millions):

	July 3, 2021		December 31, 2020
Cash and cash equivalents	$	9.3	$	10.0
Accounts receivable, net of allowance for credit losses of $1.0 and $1.1, respectively	496.4		460.7
Inventories	143.4		140.8
Prepaid expenses and other current assets	21.4		55.4
Current assets held for sale*			666.9
Property, plant and equipment, net	133.3		131.4
Operating lease assets	30.0		31.3
Goodwill and indefinite-lived intangible assets	680.0		681.2
Definite-lived intangible assets, net	532.9		492.8
Deferred income taxes	4.2		3.6
Other non-current assets	22.6		23.7
Non-current assets held for sale*			1,364.0
Total assets held for sale	$	2,073.5	$	2,030.9
Accounts payable	$	91.6	$	92.2
Payroll and related taxes	14.1		22.3
Accrued customer programs	235.6		237.4
Other accrued liabilities	27.4		67.2
Accrued income taxes	0.1		—
Current indebtedness	0.5		0.5
Current liabilities held for sale*			419.6
Long-term debt, less current portion	0.4		0.7
Deferred income taxes	3.2		3.1
Other non-current liabilities	64.6		104.5
Non-current liabilities held for sale*			108.3
Total liabilities held for sale	$	437.5	$	527.9

*The non-current assets and liabilities of the RX business have been reclassified to current assets and liabilities held for sale, respectively, and the sale was completed on July 6, 2021.

ASSETS HELD FOR SALE

We classify assets as "held for sale" when, among other factors, management approves and commits to a formal plan of sale with the expectation the sale will be completed within one year. The net assets of the business held for sale are then recorded at the lower of their current carrying value and the fair market value, less costs to sell.

During the three months ended July 3, 2021, management committed to a plan to sell our Latin American businesses; as a result, such assets were classified as held for sale. The assets associated with this business were reported within our CSCA segment. The sale is expected to close in the second half of 2021. At July 3, 2021, we determined the carrying value of the net assets held for sale of this business exceeded their fair value less cost to sell, resulting in an impairment charge of $152.5 million. We also recorded a goodwill impairment charge of $6.1 million within our CSCA segment, related to the Latin American businesses (refer to Note 4), resulting in a total impairment charge of $158.6 million.

In addition to the assets and liabilities held for sale related to discontinued operations (refer to Note 8), the assets and liabilities held for sale related to the Latin American businesses were reported within Current assets held for sale and Current liabilities held for sale on the Condensed Consolidated Balance Sheets. Net of impairment

charges, the assets and liabilities of the Latin American businesses reported as held for sale as of July 3, 2021 totaled $15.8 million and $30.8 million, respectively.

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Derivative Instruments and Hedging Activities

6 Months Ended

Jul. 03, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES     

Cross Currency Swaps

On August 15, 2019, we entered into a cross-currency swap designated as a net investment hedge to hedge the EUR currency exposure of our net investment in European operations. This agreement is a contract to exchange floating-rate Euro payments for floating-rate U.S. dollar payments through August 15, 2022. The payments are based on a notional basis of €450.0 million ($498.0 million) and settle quarterly.

Interest Rate Swaps

There were no active designated or non-designated interest rate swaps as of July 3, 2021 or December 31, 2020.

Foreign Currency Forwards

Foreign currency forward contracts were as follows (in millions):

	Notional Amount
	July 3, 2021		December 31, 2020
European Euro (EUR)	$	209.3	$	312.6
British Pound (GBP)	104.4		92.3
Israeli Shekel (ILS)	71.6		94.4
Danish Krone (DKK)	44.7		65.2
Swedish Krona (SEK)	42.2		41.2
Chinese Yuan (CNY)	41.5		49.1
United States Dollar (USD)	26.3		101.5
Canadian Dollar (CAD)	23.3		36.8
Polish Zloty (PLZ)	22.2		21.8
Norwegian Krone (NOK)	10.5		7.8
Romanian New Leu (RON)	5.7		3.6
Switzerland Franc (CHF)	5.1		8.2
Australian Dollar (AUD)	5.0		11.3
Turkish Lira (TRY)	4.3		4.0
Mexican Peso (MPX)	1.0		15.6
Other	2.6		2.3
Total	$	619.7	$	867.7

The maximum term of our forward currency exchange contracts is 60 months.

Effects of Derivatives on the Financial Statements

The below tables indicate the effects of all derivative instruments on the Condensed Consolidated Financial Statements. All amounts exclude income tax effects.

The balance sheet location and gross fair value of our outstanding derivative instruments were as follows (in millions):

		Asset Derivatives
		Fair Value
	Balance Sheet Location	July 3, 2021		December 31, 2020
Designated derivatives:
Foreign currency forward contracts	Prepaid expenses and other current assets	$	5.1	$	5.0
Foreign currency forward contracts	Other non-current assets	0.3		0.5
Cross-currency swap	Other non-current assets	4.2		6.3
Total designated derivatives		$	9.6	$	11.8
Non-designated derivatives:
Foreign currency forward contracts	Prepaid expenses and other current assets	$	0.3	$	4.3

		Liability Derivatives
		Fair Value
	Balance Sheet Location	July 3, 2021		December 31, 2020
Designated derivatives:
Foreign currency forward contracts	Other accrued liabilities	$	0.9	$	5.5
Non-designated derivatives:
Foreign currency forward contracts	Other accrued liabilities	$	1.8	$	2.4

The following tables summarize the effect of derivative instruments designated as hedging instruments in Accumulated Other Comprehensive Income ("AOCI") (in millions):

	Three Months Ended
	July 3, 2021
Instrument	Amount of Gain/(Loss) Recorded in OCI		Classification of Gain/(Loss) Reclassified from AOCI into Earnings	Amount of Gain/(Loss) Reclassified from AOCI into Earnings		Classification of Gain/(Loss) Recognized into Earnings Related to Amounts Excluded from Effectiveness Testing	Amount of Gain/(Loss) Recognized in Earnings on Derivatives Related to Amounts Excluded from Effectiveness Testing
Cash flow hedges:
Interest rate swap agreements	$	—	Interest expense, net	$	(0.4)	Interest expense, net	$	—
Foreign currency forward contracts	1.1		Net sales	(1.0)		Net sales	—
			Cost of sales	0.9		Cost of sales	0.4
						Other (income) expense, net	0.4
	$	1.1		$	(0.5)		$	0.8
Net investment hedges:
Cross-currency swap	$	(1.5)				Interest expense, net	$	(1.1)

	Six Months Ended
	July 3, 2021
Instrument	Amount of Gain/(Loss) Recorded in OCI(1)		Classification of Gain/(Loss) Reclassified from AOCI into Earnings	Amount of Gain/(Loss) Reclassified from AOCI into Earnings		Classification of Gain/(Loss) Recognized into Earnings Related to Amounts Excluded from Effectiveness Testing	Amount of Gain/(Loss) Recognized in Earnings on Derivatives Related to Amounts Excluded from Effectiveness Testing
Cash flow hedges:
Interest rate swap agreements	—		Interest expense, net	(0.9)		Interest expense, net	—
Foreign currency forward contracts	(1.2)		Net sales	(1.9)		Net sales	—
			Cost of sales	2.8		Cost of sales	0.5
						Other (income) expense, net	0.4
	$	(1.2)		$	—		$	0.9
Net investment hedges:
Cross-currency swap	$	(2.0)				Interest expense, net	$	(2.2)

(1) Net loss of $8.9 million is expected to be reclassified out of AOCI into earnings during the next 12 months.

	Three Months Ended
	June 27, 2020
Instrument	Amount of Gain/(Loss) Recorded in OCI		Classification of Gain/(Loss) Reclassified from AOCI into Earnings	Amount of Gain/(Loss) Reclassified from AOCI into Earnings		Classification of Gain/(Loss) Recognized into Earnings Related to Amounts Excluded from Effectiveness Testing	Amount of Gain/(Loss) Recognized in Earnings on Derivatives Related to Amounts Excluded from Effectiveness Testing
Cash flow hedges:
Interest rate swap agreements	$	—	Interest expense, net	$	(0.5)	Interest expense, net	$	—
Foreign currency forward contracts	0.5		Net sales	0.3		Net sales	—
			Cost of sales	0.1		Cost of sales	0.3
	$	0.5		$	(0.1)		$	0.3
Net investment hedges:
Cross-currency swap	$	(3.3)				Interest expense, net	$	1.8

	Six Months Ended
	June 27, 2020
Instrument	Amount of Gain/(Loss) Recorded in OCI		Classification of Gain/(Loss) Reclassified from AOCI into Earnings	Amount of Gain/(Loss) Reclassified from AOCI into Earnings		Classification of Gain/(Loss) Recognized into Earnings Related to Amounts Excluded from Effectiveness Testing	Amount of Gain/(Loss) Recognized in Earnings on Derivatives Related to Amounts Excluded from Effectiveness Testing
Cash flow hedges:
Interest rate swap agreements	$	—	Interest expense, net	$	(0.9)	Interest expense, net	$	—
Foreign currency forward contracts	9.8		Net sales	(0.1)		Net sales	—
			Cost of sales	(1.0)		Cost of sales	0.7
	$	9.8		$	(2.0)		$	0.7
Net investment hedges:
Cross-currency swap	$	(18.3)				Interest expense, net	$	4.6

The amounts of (income)/expense recognized in earnings related to our non-designated derivatives on the Condensed Consolidated Statements of Operations were as follows (in millions):

		Three Months Ended				Six Months Ended
Non-Designated Derivatives	Income Statement Location	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Foreign currency forward contracts	Other (income) expense, net	$	(3.1)	$	(7.0)	$	(5.9)	$	(0.2)
	Interest expense, net	0.4		1.1		0.9		1.4
		$	(2.7)	$	(5.9)	$	(5.0)	$	1.2

The classification and amount of gain/(loss) recognized in earnings on fair value and hedging relationships were as follows (in millions):

	Three Months Ended
	July 3, 2021
	Net Sales		Cost of Sales		Interest Expense, net		Other (Income) Expense, net
Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded	$	981.1	$	632.1	$	31.6	$	(0.4)
The effects of cash flow hedging:
Gain (loss) on cash flow hedging relationships
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	$	(1.0)	$	0.9	$	—	$	—
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	$	—	$	0.4	$	—	$	0.4
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	$	—	$	—	$	(0.4)	$	—

	Six Months Ended
	July 3, 2021
	Net Sales		Cost of Sales		Interest Expense, net		Other (Income) Expense, net
Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded	$	1,991.1	$	1,273.7	$	63.6	$	1.9
The effects of cash flow hedging:
Gain (loss) on cash flow hedging relationships
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	$	(1.9)	$	2.8	$	—	$	—
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	$	—	$	0.5	$	—	$	0.4
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	$	—	$	—	$	(0.9)	$	—

	Three Months Ended
	June 27, 2020
	Net Sales		Cost of Sales		Interest Expense, net		Other (Income) Expense, net
Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded	$	948.8	$	601.6	$	32.2	$	17.1
The effects of cash flow hedging:
Gain (loss) on cash flow hedging relationships
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	$	0.3	$	0.1	$	—	$	—
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	$	—	$	0.3	$	—	$	—
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	$	—	$	—	$	(0.5)	$	—

	Six Months Ended
	June 27, 2020
	Net Sales		Cost of Sales		Interest Expense, net		Other (Income) Expense, net
Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded	$	2,032.0	$	1,291.1	$	61.1	$	18.8
The effects of cash flow hedging:
Gain (loss) on cash flow hedging relationships
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	$	(0.1)	$	(1.0)	$	—	$	—
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	$	—	$	0.7	$	—	$	—
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	$	—	$	—	$	(0.9)	$	—

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Leases

6 Months Ended

Jul. 03, 2021

Leases [Abstract]

Leases

LEASES

The balance sheet locations of our lease assets and liabilities were as follows (in millions):

Assets	Balance Sheet Location	July 3, 2021		December 31, 2020
Operating	Operating lease assets	$	171.3	$	154.7
Finance	Other non-current assets	31.0		29.8
Total		$	202.3	$	184.5

Liabilities	Balance Sheet Location	July 3, 2021		December 31, 2020
Current
Operating	Other accrued liabilities	$	27.9	$	28.3
Finance	Current indebtedness	5.2		6.7
Non-Current
Operating	Other non-current liabilities	149.6		132.5
Finance	Long-term debt, less current portion	23.3		20.2
Total		$	206.0	$	187.7

The below table shows our lease assets and liabilities by reporting segment (in millions):

	Assets
	Operating				Financing
	July 3, 2021		December 31, 2020		July 3, 2021		December 31, 2020
CSCA	$	98.1	$	75.9	$	16.1	$	16.7
CSCI	32.3		34.4		8.6		5.9
Unallocated	40.9		44.4		6.3		7.2
Total	$	171.3	$	154.7	$	31.0	$	29.8

	Liabilities
	Operating				Financing
	July 3, 2021		December 31, 2020		July 3, 2021		December 31, 2020
CSCA	$	98.2	$	75.8	$	16.6	$	17.0
CSCI	33.7		35.2		5.4		2.5
Unallocated	45.6		49.8		6.5		7.4
Total	$	177.5	$	160.8	$	28.5	$	26.9

Lease expense was as follows (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Operating leases(1)	$	9.8	$	8.5	$	19.7	$	18.1
Finance leases
Amortization	$	1.5	$	1.0	$	3.0	$	2.0
Interest	0.2		0.2		0.4		0.4
Total finance leases	$	1.7	$	1.2	$	3.4	$	2.4

            (1) Includes short-term leases and variable lease costs, which are immaterial.

The annual future maturities of our leases as of July 3, 2021 are as follows (in millions):

	Operating Leases		Finance Leases		Total
2021	$	16.5	$	3.0	$	19.5
2022	28.0		5.5		33.5
2023	20.7		3.9		24.6
2024	17.6		2.4		20.0
2025	15.7		2.2		17.9
After 2025	106.9		15.9		122.8
Total lease payments	205.4		32.9		238.3
Less: Interest	27.9		4.4		32.3
Present value of lease liabilities	$	177.5	$	28.5	$	206.0

Our weighted average lease terms and discount rates are as follows:

	July 3, 2021		June 27, 2020
Weighted-average remaining lease term (in years)
Operating leases	11.59		6.31
Finance leases	9.24		9.89
Weighted-average discount rate
Operating leases	2.71	%	3.73	%
Finance leases	2.76	%	3.39	%

Our lease cash flow classifications are as follows (in millions):

	Six Months Ended
	July 3, 2021		June 27, 2020
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows for operating leases	$	18.2	$	17.3
Operating cash flows for finance leases	$	0.4	$	0.4
Financing cash flows for finance leases	$	2.6	$	1.9
Leased assets obtained in exchange for new finance lease liabilities	$	4.4	$	2.2
Leased assets obtained in exchange for new operating lease liabilities	$	34.9	$	22.3

Leases

LEASES

The balance sheet locations of our lease assets and liabilities were as follows (in millions):

Assets	Balance Sheet Location	July 3, 2021		December 31, 2020
Operating	Operating lease assets	$	171.3	$	154.7
Finance	Other non-current assets	31.0		29.8
Total		$	202.3	$	184.5

Liabilities	Balance Sheet Location	July 3, 2021		December 31, 2020
Current
Operating	Other accrued liabilities	$	27.9	$	28.3
Finance	Current indebtedness	5.2		6.7
Non-Current
Operating	Other non-current liabilities	149.6		132.5
Finance	Long-term debt, less current portion	23.3		20.2
Total		$	206.0	$	187.7

The below table shows our lease assets and liabilities by reporting segment (in millions):

	Assets
	Operating				Financing
	July 3, 2021		December 31, 2020		July 3, 2021		December 31, 2020
CSCA	$	98.1	$	75.9	$	16.1	$	16.7
CSCI	32.3		34.4		8.6		5.9
Unallocated	40.9		44.4		6.3		7.2
Total	$	171.3	$	154.7	$	31.0	$	29.8

	Liabilities
	Operating				Financing
	July 3, 2021		December 31, 2020		July 3, 2021		December 31, 2020
CSCA	$	98.2	$	75.8	$	16.6	$	17.0
CSCI	33.7		35.2		5.4		2.5
Unallocated	45.6		49.8		6.5		7.4
Total	$	177.5	$	160.8	$	28.5	$	26.9

Lease expense was as follows (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Operating leases(1)	$	9.8	$	8.5	$	19.7	$	18.1
Finance leases
Amortization	$	1.5	$	1.0	$	3.0	$	2.0
Interest	0.2		0.2		0.4		0.4
Total finance leases	$	1.7	$	1.2	$	3.4	$	2.4

            (1) Includes short-term leases and variable lease costs, which are immaterial.

The annual future maturities of our leases as of July 3, 2021 are as follows (in millions):

	Operating Leases		Finance Leases		Total
2021	$	16.5	$	3.0	$	19.5
2022	28.0		5.5		33.5
2023	20.7		3.9		24.6
2024	17.6		2.4		20.0
2025	15.7		2.2		17.9
After 2025	106.9		15.9		122.8
Total lease payments	205.4		32.9		238.3
Less: Interest	27.9		4.4		32.3
Present value of lease liabilities	$	177.5	$	28.5	$	206.0

Our weighted average lease terms and discount rates are as follows:

	July 3, 2021		June 27, 2020
Weighted-average remaining lease term (in years)
Operating leases	11.59		6.31
Finance leases	9.24		9.89
Weighted-average discount rate
Operating leases	2.71	%	3.73	%
Finance leases	2.76	%	3.39	%

Our lease cash flow classifications are as follows (in millions):

	Six Months Ended
	July 3, 2021		June 27, 2020
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows for operating leases	$	18.2	$	17.3
Operating cash flows for finance leases	$	0.4	$	0.4
Financing cash flows for finance leases	$	2.6	$	1.9
Leased assets obtained in exchange for new finance lease liabilities	$	4.4	$	2.2
Leased assets obtained in exchange for new operating lease liabilities	$	34.9	$	22.3

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Indebtedness

6 Months Ended

Jul. 03, 2021

Debt Disclosure [Abstract]

Indebtedness

INDEBTEDNESS

Total borrowings outstanding are summarized as follows (in millions):

			July 3, 2021		December 31, 2020
Term loan
	2019 Term loan due August 15, 2022		$	600.0	$	600.0
Notes and Bonds
	Coupon	Due
	5.105%	July 28, 2023(1)	160.2		164.9
	4.000%	November 15, 2023	215.6		215.6
	3.900%	December 15, 2024	700.0		700.0
	4.375%	March 15, 2026	700.0		700.0
	3.150%	June 15, 2030	750.0		750.0
	5.300%	November 15, 2043	90.5		90.5
	4.900%	December 15, 2044	303.9		303.9
	Total notes and bonds		2,920.2		2,924.9
Other financing			53.4		57.4
Unamortized premium (discount), net			(2.1)		(0.3)
Deferred financing fees			(15.6)		(17.1)
Total borrowings outstanding			3,555.9		3,564.9
	Current indebtedness		(630.1)		(37.3)
Total long-term debt less current portion			$	2,925.8	$	3,527.6

    (1) Debt denominated in euros subject to fluctuations in the euro-to-U.S. dollar exchange rate.

Revolving Credit Agreements

On March 8, 2018, we entered into a $1.0 billion revolving credit agreement maturing on March 8, 2023 (the "2018 Revolver"). There were no borrowings outstanding under the 2018 Revolver as of July 3, 2021 or December 31, 2020.

Term Loan and Notes

In August 2019, we refinanced a prior term loan with the proceeds of a new $600.0 million term loan, maturing on August 15, 2022 (the "2019 Term Loan"). We had $600.0 million outstanding under our 2019 Term Loan as of both July 3, 2021 and December 31, 2020.

Waiver of Debt Covenants

We are subject to financial covenants in the 2018 Revolver and 2019 Term Loan, including a maximum leverage ratio covenant, which previously required us to maintain a ratio of Consolidated Net Indebtedness to Consolidated EBITDA (as such terms are defined in such credit agreements) of not more than 3.75 to 1.00 at the end of each fiscal quarter. As of July 3, 2021, we were not in compliance with such covenant. However, we have received a waiver of such covenant from the lenders under both such credit facilities and have entered into an amendment to each of the 2018 Revolver and 2019 Term Loan. Under such amendments, the maximum leverage ratio was increased to 5.75 to 1.00 for the third quarter of 2021, returning to 3.75 to 1.00 beginning with the fourth quarter of 2021. If we consummate certain qualifying acquisitions in the fourth quarter of 2021 or any subsequent quarter during the term of the loan, the maximum ratio would increase to 4.00 to 1.00 for such quarter. Neither the failure to meet the leverage covenant for the second quarter of 2021, nor the waiver and amendments described above, affect our ability to draw under the 2018 Revolver.

2020 Notes

On June 19, 2020, Perrigo Finance Unlimited Company, an indirect wholly-owned finance subsidiary of Perrigo ("Perrigo Finance"), issued $750.0 million in aggregate principal amount of 3.150% Senior Notes due 2030 (the “2020 Notes") and received net proceeds of $737.1 million after the underwriting discount and offering expenses. Interest on the 2020 Notes is payable semi-annually in arrears on June 15 and December 15 of each year, beginning on December 15, 2020. The 2020 Notes will mature on June 15, 2030 and are governed by a base indenture and a third supplemental indenture (collectively, the "2020 Indenture"). The 2020 Notes are fully and unconditionally guaranteed on a senior unsecured basis by Perrigo. Perrigo Finance may redeem the 2020 Notes in whole or in part at any time for cash at the make-whole redemption prices described in the 2020 Indenture. On July 6, 2020, a portion of the proceeds of the 2020 Notes were used to fund the redemption of $280.4 million of Perrigo Finance's 3.500% Senior Notes due March 15, 2021 and $309.6 million of 3.500% Senior Notes due December 15, 2021.

Other Financing

We have overdraft facilities available that we use to support our cash management operations. We report any balances outstanding in the above table under "Other financing". There were no borrowings outstanding under the facilities as of July 3, 2021 or December 31, 2020.

On June 17, 2020, we incurred debt of $34.3 million related to our equity method investment in Kazmira pursuant to two Promissory Notes, with $3.7 million, $5.8 million and $24.8 million to be settled in November 2020, May 2021 and November 2021, respectively. On December 8, 2020, we repaid the $3.7 million balance due on the November 2020 portion of the Promissory Notes. On June 7, 2021, we repaid the $5.8 million balance due on the May 2021 portion of the Promissory Notes.

We have financing leases that are reported in the above table under "Other financing" (refer to Note 11).

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Earnings Per Share and Shareholders' Equity

6 Months Ended

Jul. 03, 2021

Earnings Per Share [Abstract]

Earnings Per Share and Shareholders' Equity

EARNINGS PER SHARE AND SHAREHOLDERS' EQUITY

Earnings per Share

A reconciliation of the numerators and denominators used in the basic and diluted earnings per share ("EPS") calculation is as follows (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Numerator:
Income (loss) from continuing operations	$	(111.9)	$	12.4	$	(109.1)	$	70.1
Income from discontinued operations, net of tax	54.2		48.2		89.5		96.9
Net income (loss)	$	(57.7)	$	60.6	$	(19.6)	$	167.0
Denominator:
Weighted average shares outstanding for basic EPS	133.6		136.4		133.4		136.3
Dilutive effect of share-based awards*	—		1.1		—		1.0
Weighted average shares outstanding for diluted EPS	133.6		137.5		133.4		137.3
Anti-dilutive share-based awards excluded from computation of diluted EPS	—		1.5		—		1.5
* In the period of a net loss, diluted shares equal basic shares.

Shareholders' Equity

Share Repurchases

In October 2018, our Board of Directors authorized up to $1.0 billion of share repurchases with no expiration date, subject to the Board of Directors’ approval of the pricing parameters and amount that may be repurchased under each specific share repurchase program (the "2018 Authorization"). We did not repurchase any shares during the three and six months ended July 3, 2021 and June 27, 2020.

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Accumulated Other Comprehensive Income (Loss)

6 Months Ended

Jul. 03, 2021

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Accumulated Other Comprehensive Income (Loss)

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Changes in our AOCI balances, net of tax were as follows (in millions):

	Fair Value of Derivative Financial Instruments, net of tax		Foreign Currency Translation Adjustments		Post-Retirement and Pension Liability Adjustments, net of tax		Total AOCI
Balance at December 31, 2020	$	(0.7)	$	407.3	$	(11.6)	$	395.0
OCI before reclassifications	(7.3)		(79.1)		(1.5)		(87.9)
Amounts reclassified from AOCI	—		—		—		—
Other comprehensive income (loss)	$	(7.3)	$	(79.1)	$	(1.5)	$	(87.9)
Balance at July 3, 2021	$	(8.0)	$	328.2	$	(13.1)	$	307.1

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Income Taxes

6 Months Ended

Jul. 03, 2021

Income Tax Disclosure [Abstract]

Income Taxes

INCOME TAXES

The effective tax rates were as follows:

Three Months Ended				Six Months Ended
July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
28.8	%	19.7	%	22.1	%	3.9	%

The effective tax rate for the three and six months ended July 3, 2021 increased compared to the effective tax rate for the three and six months ended June 27, 2020, primarily due to tax benefits in the 2020 periods for reductions to the U.S. valuation allowance and the U.S. Coronavirus Aid, Relief and Economic Security ("CARES") Act, enacted in the first quarter of 2020, plus the net tax expense on 2021 intra-entity transfers of intellectual property.

In December 2019, the FASB issued ASU No. 2019-12, "Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes." It removes certain exceptions to the general principles in ASC Topic 740 and improves consistent application of and simplifies GAAP for other areas of ASC Topic 740 by clarifying and amending existing guidance. This guidance was effective for interim and annual reporting periods beginning after December 15, 2020. We adopted this guidance as of January 1, 2021, and the impact on our Consolidated Financial Statements was immaterial.

Internal Revenue Service Audits of Perrigo Company, a U.S. Subsidiary

Perrigo Company, our U.S. subsidiary ("Perrigo U.S."), is engaged in a series of tax disputes in the U.S. relating primarily to transfer pricing adjustments including income in connection with the purchase, distribution, and sale of store-brand OTC pharmaceutical products in the United States, including the heartburn medication omeprazole. On August 27, 2014, we received a statutory notice of deficiency from the IRS relating to our fiscal tax years ended June 27, 2009, and June 26, 2010 (the “2009 tax year” and “2010 tax year”, respectively). On April 20, 2017, we received a second statutory notice of deficiency from the IRS for the fiscal tax years ended June 25, 2011 and June 30, 2012 (the “2011 tax year” and “2012 tax year”, respectively). Specifically, both statutory notices proposed adjustments related to the offshore reporting of profits on sales of omeprazole in the United States resulting from the assignment of an omeprazole distribution contract to an affiliate. In addition to the transfer pricing adjustments, which applied to all four tax years, the statutory notice of deficiency for the 2011 and 2012 tax years included adjustments for the capitalization and amortization of certain expenses that were deducted when paid or incurred in defending against certain patent infringement lawsuits related to ANDAs.

We do not agree with the audit adjustments proposed by the IRS in either of the notices of deficiency. We paid the assessed amounts of tax, interest, and penalties set forth in the statutory notices and timely filed claims for refund on June 11, 2015 for the 2009 and 2010 tax years, and on June 7, 2017, for the 2011 and 2012 tax years. On August 15, 2017, following disallowance of such refund claims, we timely filed a complaint in the United States District Court for the Western District of Michigan seeking refunds of tax, interest, and penalties of $27.5 million for the 2009 tax year, $41.8 million for the 2010 tax year, $40.1 million for the 2011 tax year, and $24.7 million for the 2012 tax year, for a total of $134.1 million, plus statutory interest thereon from the dates of payment. The amounts sought in the complaint for the 2009 and 2010 tax years were recorded as deferred charges in Other non-current assets on our balance sheet during the three months ended March 28, 2015, and the amounts sought in the complaint for the 2011 and 2012 tax years were recorded as deferred charges in Other non-current assets on our balance sheet during the three months ended July 1, 2017.

The previously rescheduled trial was held during the period May 25, 2021 to June 7, 2021 for the refund case in the United States District Court for the Western District of Michigan. Post-trial briefing is scheduled to be completed by late September 2021, when the case will be fully submitted for the court's decision. The total amount of cumulative deferred charge that we are seeking to receive in this litigation is approximately $111.6 million, which reflects the impact of conceding that Perrigo U.S. should have received a 5.24% royalty on all omeprazole sales. That concession was previously paid and is the subject of the above refund claims. The issues outlined in the statutory notices of deficiency described above are continuing, and the IRS will likely carry forward the adjustments set forth therein as long as the drug is sold, in the case of the omeprazole issue, and for all post-2012 Paragraph IV

filings that trigger patent infringement suits, in the case of the ANDA issue. On April 30, 2021, we filed a Notice of New Authority in our refund case in the Western District of Michigan alerting the court to a Tax Court decision in Mylan v. Comm'r that ruled in favor of the taxpayer on the identical ANDA issues we have before the court.

On January 13, 2021, the IRS issued a 30-day letter with respect to its audit of our fiscal tax years ended June 29, 2013 (the "2013 tax year"), June 28, 2014 (the "2014 tax year"), and June 27, 2015 (the "2015 tax year" and together with the 2013 tax year and the 2014 tax year, the "2013-2015 tax years"). The IRS letter proposed, among other modifications, carryforwards of the transfer pricing adjustments regarding our profits from the distribution of omeprazole in the aggregate amount of $141.6 million and ANDA adjustments in the aggregate amount of $21.9 million. The 30-day letter also set forth adjustments described in the next two paragraphs. We timely filed a protest to the 30-day letter for those additional adjustments, but noting that due to the pending litigation described above, IRS Appeals will not consider the merits of the omeprazole or ANDA matters. We believe that we should prevail on the merits on both carryforward issues and have reserved for taxes and interest payable on the 5.24% deemed royalty on omeprazole through the tax year ended December 31, 2018. Beginning with the tax year ended December 31, 2019, we began reporting income commensurate with the 5.24% deemed royalty. We have not reserved for the ANDA-related issue described above. While we believe we should prevail on the merits of this case, the outcome remains uncertain. If our litigation position on the omeprazole issue is not sustained, the outcome for the 2009–2012 tax years could range from a reduction in the refund amount to denial of any refund. In addition, we expect that the outcome of the refund litigation could effectively bind future tax years. In that event, an adverse ruling on the omeprazole issue could have a material impact on subsequent periods, with additional tax liability in the range of $24.0 million to $112.0 million, not including interest and any applicable penalties.

The 30-day letter for the 2013-2015 tax years also proposed to reduce Perrigo U.S.'s deductible interest expense for the 2014 tax year and the 2015 tax year on $7.5 billion in debts owed by it to Perrigo Company plc. The debts were incurred in connection with the Elan merger transaction in 2013. On May 7, 2020, the IRS issued a NOPA capping the interest rate on the debts for U.S. federal tax purposes at 130.0% of the Applicable Federal Rate ("AFR") (a blended rate reduction of 4.0% per annum), on the stated ground that the loans were not negotiated on an arms’-length basis. The NOPA proposes a reduction in gross interest expense of approximately $414.7 million for tax years 2014 and 2015. On January 13, 2021, we received a Revenue Agent Report ("RAR"), together with the 30-day letter, requiring our filing of a written Protest to request IRS Appeals consideration. The Protest was filed with the IRS on February 26, 2021. On May 3, 2021, the IRS notified us that it will no longer pursue the 130% of AFR position reflected in its NOPA due to a change in IRS policy. The IRS will provide a new proposed adjustment in its rebuttal to our Protest, which we have not yet received. Because the IRS' revised adjustment is currently unknown and cannot be quantified, we are unable to determine the amount of gross interest expense that the IRS proposes to disallow, and we cannot estimate any increase in tax expense attributable to any such disallowance for the period under audit. In addition, we expect the IRS to seek similar revised adjustments for the tax years ended December 31, 2015 through December 31, 2018 with potential section 163(j) carryover impacts beyond December 2018. We cannot determine the amount, if any, of the estimated increase in tax expense attributable to any such adjustments. No further interest adjustments are expected beyond this period. We strongly disagree with the IRS position and we will pursue all available administrative and judicial remedies necessary. At this stage, we are unable to estimate any additional liability associated with this matter.

In addition, the 30-day letter for the 2013-2015 tax years expanded on a NOPA issued on December 11, 2019 and proposed to disallow adjustments to gross sales income on the sale of prescription products to wholesalers for accrued wholesale customer pipeline chargebacks where the prescription products were not re-sold by such wholesalers to covered retailers by the end of the tax year for the 2013-2015 tax years. The IRS' NOPA asserts that the reduction of gross sales income of such chargebacks is an impermissible method of accounting. The IRS proposed a change in accounting method that would defer the reduction in gross sales income until the year the prescription products were re-sold to covered retailers. The NOPA proposes an increase in sales revenue of approximately $99.5 million for the 2013-2015 tax years. We filed a protest on February 26, 2021 to request IRS Appeals consideration. If the IRS were to prevail in its proposed adjustment, we estimate a payment of approximately $18.0 million, excluding interest and penalties for the 2013-2015 tax years. In addition, we expect the IRS to seek similar adjustments for future years. If those future adjustments were to be sustained, based on preliminary calculations and subject to further analysis, our current best estimate is a payment that will not exceed $7.0 million through tax year ended December 31, 2020, excluding interest and penalties. We have fully reserved for this issue. We strongly disagree with the IRS’s proposed adjustment and will pursue all available administrative and judicial remedies necessary.

Internal Revenue Service Audit of Athena Neurosciences, Inc., a U.S. Subsidiary    

On April 26, 2019, we received a revised NOPA from the IRS regarding transfer pricing positions related to the IRS audit of Athena Neurosciences, Inc. ("Athena") for the years ended December 31, 2011, December 31, 2012, and December 31, 2013. The NOPA carries forward the IRS's theory from its 2017 draft NOPA that when Elan took over the future funding of Athena's in-process research and development after acquiring Athena in 1996, Elan should have paid a substantially higher royalty rate for the right to exploit Athena’s intellectual property, rather than rates based on transfer pricing documentation prepared by Elan's external tax advisors. The NOPA proposes a payment of $843.0 million, which represents additional tax and a 40.0% penalty. This amount excludes consideration of offsetting tax attributes and any potential interest that may be imposed. We strongly disagree with the IRS position. On December 22, 2016, we also received a NOPA for these years denying the deductibility of settlement costs related to illegal marketing of Zonegran in the United States raised in a Qui Tam action. We strongly disagree with the IRS' position on this issue as well. Because we believe that any concession on these issues in Appeals would be contrary to our evaluation of the issues, we pursued our remedies under the U.S. - Ireland Income Tax Treaty to alleviate double taxation. On April 14, 2020, we filed a request for Competent Authority Assistance with the IRS on the royalty issue, and it was accepted. On October 20, 2020, we amended our request for Competent Authority Assistance to include the Zonegran issue and this amendment was also accepted. On May 6, 2021, we had our opening conference with the IRS and discussed our submission, which continues to be reviewed by the IRS. Our opening conference with Irish Revenue was held on July 23, 2021 and we discussed our submission, which continues to be reviewed by Irish Revenue.

No payment of the additional amounts is required until these two matters are resolved with finality under the treaty, or any additional administrative or judicial process if treaty negotiations are unsuccessful.

Irish Revenue Audit of Fiscal Years Ended December 31, 2012 and December 31, 2013

On October 30, 2018, we received an audit findings letter from the Irish Office of the Revenue Commissioners (“Irish Revenue”) for the tax years ended December 31, 2012 and December 31, 2013. The audit findings letter relates to the tax treatment of the 2013 sale of the Tysabri® intellectual property and related assets to Biogen Idec by Elan Pharma. The consideration paid by Biogen Idec to Elan Pharma took the form of an upfront payment and future contingent royalty payments. Elan Pharma recognized such receipts as trading income in its tax returns filed with Irish Revenue, consistent with Elan Pharma's historical practice relating to its active management of intellectual property rights.

In its audit findings letter, Irish Revenue proposed to charge Elan Pharma tax on the net chargeable gain realized by Elan Pharma on the Tysabri® transaction in 2013 at a rate of 33%, rather than the 12.5% tax rate applied to trading income. On November 29, 2018, Irish Revenue issued a Notice of Amended Assessment (“NoA”) for the tax year ended December 31, 2013, in the amount of €1,643 million, and claiming tax payable in the amount of €1,636 million, not including any interest or applicable penalties.

We strongly disagree with this assessment and believe that the NoA is without merit and incorrect as a matter of law. We will pursue all available administrative and judicial avenues as may be necessary or appropriate. Accordingly, we filed an appeal of the NoA on December 27, 2018 with the Irish Tax Appeals Commission ("TAC") which is the statutory body charged with considering whether the NoA is properly founded as a matter of Irish tax law. Separately, we were also granted leave by the Irish High Court on February 25, 2019 to seek judicial review of the issuance of the NoA by Irish Revenue.

On November 4, 2020, the High Court ruled that the Irish Revenue's decision to issue the NoA did not violate Elan Pharma's constitutional rights and legitimate expectations as a taxpayer. Importantly, the Irish High Court did not rule on the merits of the NoA under Irish tax law. The TAC will now consider whether the NoA is correct as a matter of Irish tax law. The tax appeal is scheduled to be heard in November 2021.

We strongly believe that Elan Pharma’s tax position is correct and would ultimately be confirmed through judicial process. However, in light of the risks and delays inherent in any litigation, representatives of Perrigo met with representatives of Irish Revenue on March 18, 2021 and April 14, 2021, to explore whether there may be a path forward toward resolving the dispute. On April 26, 2021, Perrigo, through its tax adviser, made a without prejudice written offer of settlement to Irish Revenue detailing a possible framework for such a resolution, which

applied an alternative basis of taxation than the respective positions taken by Irish Revenue in the NoA and by Elan Pharma in its tax returns. On May 31, 2021, Irish Revenue issued a formal response to Perrigo's tax adviser indicating that the written settlement offer would not be accepted as presented. While that offer was not accepted, Irish Revenue indicated that they remain available for further discussion without prejudice. The Company’s representatives continue to meet and correspond with Irish Revenue, and Perrigo anticipates further discussions prior to the TAC hearing in November 2021.

On July 9, 2021, Irish Revenue issued a letter acknowledging that not all relevant facts were known to them when they issued the NoA in 2018 and, accordingly, they would not object if the Appeal Commissioner were to make certain adjustments reducing Irish Revenue’s original assessment. Such adjustments would reflect contingent royalty payments that were never received by Elan Pharma, deductions for acquisition and development costs incurred, and allowable losses and reliefs, and would, if allowed, result in an aggregate reduction of more than €660.0 million from the income taxes claimed in the NoA as issued. The reduced claim is not a settlement proposal or compromise by Irish Revenue, but rather a confirmation that Irish Revenue would not object to certain adjustments to the underlying assessment given facts now known to Irish Revenue that were not known to Irish Revenue when they issued the NoA in 2018. Accordingly, Perrigo believes that the maximum amount of income tax claims in dispute is now reduced to less than €1.0 billion, not including any interest or penalties, if applicable.

There can be no assurances that any settlement is possible on terms acceptable to Perrigo. Unless and until a final settlement is reached, Elan Pharma will vigorously pursue its tax appeal before the TAC, concurrently with any settlement discussions that may occur. No payment of any additional tax will be required unless and until required by a settlement or other final determination.

Israel Tax Authority Audit of Fiscal Year Ended June 27, 2015 and Calendar Years Ended December 31, 2015 through December 31, 2019

The Israel Tax Authority ("ITA") audited our income tax returns for the 2015 tax year, and calendar years ended December 31, 2015, December 31, 2016 and December 31, 2017. On December 29, 2020, we received a Stage A assessment from the ITA for the tax years ended December 31, 2015 through December 31, 2017 in the amount of $63.8 million relating to attribution of intangible income to Israel, income qualifying for a lower preferential rate of tax, exemption from capital gains tax, and deduction of certain settlement payments. Our protest was timely filed on March 11, 2021 to move the matter to Stage B of the assessment process.

Through negotiations with the ITA, we resolved the audit for the tax year ended June 27, 2015 through tax year ended December 31, 2019, by agreeing to add tax year ended December 31, 2018 and tax year ended December 31, 2019 to the audit period to reach an agreeable resolution to provide certainty for these additional periods. The agreement with the ITA required us to pay $19.0 million, after offset for refunds of $17.2 million, for the five taxable years. In addition, we paid $12.5 million to resolve a tax liability indemnity for the tax year ended December 31, 2017 relating to Perrigo API Ltd, which we disposed of in December 2017 (refer to Note 16).

As a result of the settlement with the ITA, we reduced our liability recorded for uncertain tax positions by $38.3 million including interest.

    Although we believe that our tax estimates are reasonable and that we prepare our tax filings in accordance with all applicable tax laws, the final determination with respect to any tax audit and any related litigation could be materially different from our estimates or from our historical income tax provisions and accruals. The results of an audit or litigation could have a material effect on operating results and/or cash flows in the periods for which that determination is made. In addition, future period earnings may be adversely impacted by litigation costs, settlements, penalties, and/or interest assessments.

Based on the final resolution of tax examinations, judicial or administrative proceedings, changes in facts or law, expirations of statute of limitations in specific jurisdictions or other resolutions of, or changes in, tax positions - one or more of which may occur within the next twelve months - it is reasonably possible that unrecognized tax benefits for certain tax positions taken on previously filed tax returns may change materially from those recorded as of July 3, 2021. However, we are not able to estimate a reasonably possible range of how these events may impact our unrecognized tax benefits in the next twelve months.

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Contingencies

6 Months Ended

Jul. 03, 2021

Commitments and Contingencies Disclosure [Abstract]

Contingencies

CONTINGENCIES

    In view of the inherent difficulties of predicting the outcome of various types of legal proceedings, we cannot determine the ultimate resolution of the matters described below. We establish reserves for litigation and regulatory matters when losses associated with the claims become probable and the amounts can be reasonably estimated. The actual costs of resolving legal matters may be substantially higher or lower than the amounts reserved for those matters. For matters where the likelihood or extent of a loss is not probable or cannot be reasonably estimated as of July 3, 2021, we have not recorded a loss reserve. If certain of these matters are determined against us, there could be a material adverse effect on our financial condition, results of operations, or cash flows. We currently believe we have valid defenses to the claims in these lawsuits and intend to defend these lawsuits vigorously regardless of whether or not we have a loss reserve. Other than what is disclosed below, we do not expect the outcome of the litigation matters to which we are currently subject to have, individually or in the aggregate, a material adverse effect on our financial condition, results of operations, or cash flows.

Price-Fixing Lawsuits

Perrigo is a defendant in several cases in the generic pricing multidistrict litigation MDL No. 2724 (United States District Court for Eastern District of Pennsylvania). This multidistrict litigation, which has many cases that do not include Perrigo, includes class action and opt-out cases for federal and state antitrust claims, as well as complaints filed by certain states alleging violations of state antitrust laws.

On July 14, 2020, the court issued an order designating the following cases to proceed on a more expedited basis (as a bellwether) than the other cases in MDL No. 2724: (a) the May 2019 state case alleging an overarching conspiracy involving more than 120 products (which does not name Perrigo a defendant) and (b) class actions alleging “single drug” conspiracies involving Clomipramine, Pravastatin, and Clobetasol. Perrigo is a defendant in the Clobetasol cases but not the others. On February 9, 2021, the court entered an order provisionally deciding to remove the May 2019 state case and the pravastatin class cases from the bellwether proceedings. On May 7, 2021, the Court ruled that the clobetasol end payer and direct purchaser class cases will remain part of the bellwether. The Court also ruled that the June 10, 2020 State Complaint against Perrigo and approximately 35 other manufacturers will move forward as a bellwether case. No schedule has been set for the bellwether cases.

Class Action Complaints

(a) Single Drug Conspiracy Class Actions

We have been named as a co-defendant with certain other generic pharmaceutical manufacturers in a number of class actions alleging single-product conspiracies to fix or raise the prices of certain drugs and/or allocate customers for those products starting, in some instances, as early as June 2013. The class actions were filed on behalf of putative classes of (a) direct purchasers, (b) end payors, and (c) indirect resellers. The products in question are Clobetasol gel, Desonide, and Econazole. The court denied motions to dismiss each of the complaints alleging “single drug” conspiracies involving Perrigo, and the cases are proceeding in discovery. As noted above, the Clobetasol cases have been designated to proceed on a more expedited schedule than the other cases. That schedule has not yet been set.

(b) “Overarching Conspiracy” Class Actions

The same three putative classes, including (a) direct purchasers, (b) end payors, and (c) indirect resellers, have filed two sets of class action complaints alleging that Perrigo and other manufacturers (and some individuals) entered into an “overarching conspiracy” that involved allocating customers, rigging bids and raising, maintaining, and fixing prices for various products. Each class brings claims for violations of Sections 1 and 3 of the Sherman Antitrust Act as well as several state antitrust and consumer protection statutes.

Filed in June 2018, and later amended in December 2018 (with respect to direct purchasers) and April 2019 (with respect to end payors and indirect resellers), the first set of “overarching conspiracy” class actions include allegations against Perrigo and approximately 27 other manufacturers involving 135 drugs with allegations dating back to March 2011. The allegations against Perrigo concern only two formulations (cream and ointment) of one of the products at issue, Nystatin. The court denied motions to dismiss the first set of “overarching conspiracy” class actions, and they are proceeding in discovery. None of these cases are included in the group of cases on a more expedited schedule pursuant to the court’s July 14, 2020 order.

In December 2019, both the end payor and indirect reseller class plaintiffs filed a second set of "overarching conspiracy” class actions against Perrigo, dozens of other manufacturers of generic prescription pharmaceuticals, and certain individuals dating back to July 2009 (end payors) or January 2010 (indirect resellers). The direct purchaser plaintiffs filed their second round overarching conspiracy complaint in February 2020 with claims dating back to July 2009. On March 11, 2020, the indirect reseller plaintiffs filed a motion to amend their second round December 2019 complaint, and that motion was granted. On September 4, 2020, and December 15, 2020, the end payor plaintiffs amended their second round complaint. On October 21, 2020, the direct purchaser plaintiffs amended their second round complaint. On December 15, 2020, the indirect reseller plaintiffs filed another complaint adding allegations for additional drugs that mirror the other class plaintiffs’ claims.

This second set of overarching complaints allege conspiracies relating to the sale of various products that are not at issue in the earlier-filed overarching conspiracy class actions, the majority of which Perrigo neither makes nor sells. The amended indirect reseller complaint alleges that Perrigo conspired in connection with its sales of Betamethasone Dipropionate lotion, Imiquimod cream, Desonide cream and ointment, and Hydrocortisone Valerate cream. The December 2020 indirect reseller complaint alleges that Perrigo conspired in connection with its sales of Adapalene, Ammonium Lactate, Bromocriptine Mesylate, Calcipotriene, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Methazolamide, Mometasone Furoate, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide. The amended end payor complaint alleges that Perrigo conspired in connection with its sale of the following drugs: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fenofibrate, Fluocinonide, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Mometasone Furoate, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide. The amended direct purchaser complaint alleges that Perrigo conspired in connection with its sale of the following drugs: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Ciclopirox, Clindamycin Phosphate, Fenofibrate, Fluocinonide, Halobetasol Proprionate, Hydrocortisone Valerate, Methazolamide, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide.

Perrigo has not yet responded to the second set of overarching conspiracy complaints, and responses are currently stayed.

Opt-Out Complaints

On January 22, 2018, Perrigo was named a co-defendant along with 35 other manufacturers in a complaint filed by three supermarket chains alleging that defendants conspired to fix prices of 31 generic prescription pharmaceutical products starting in 2013. On December 21, 2018, an amended complaint was filed that adds additional products and allegations against a total of 39 manufacturers for 33 products. The only allegations specific to Perrigo relate to Clobetasol, Desonide, Econazole, Nystatin cream, and Nystatin ointment. Perrigo moved to dismiss this complaint on February 21, 2019. The motion was denied on August 15, 2019. The case is proceeding in discovery. On February 3, 2020, the plaintiffs requested leave to file a second amended complaint. The proposed amended complaint adds dozens of additional products and allegations to the original complaint. Perrigo is discussed in connection with allegations concerning an additional drug, Fenofibrate. Defendants opposed the motion for leave to file a second amended complaint and the court has yet to rule on the issue.

On August 3, 2018, a large managed care organization filed a complaint alleging price-fixing and customer allocation concerning 17 different products among 27 manufacturers including Perrigo. The only allegations specific to Perrigo concern Clobetasol. Perrigo moved to dismiss this complaint on February 21, 2019. Plaintiff filed a second amended complaint in April 2019 that adds additional products and allegations. The amended allegations

that concern Perrigo include: Clobetasol, Desonide, Econazole, and Nystatin. The motion to dismiss was denied on August 15, 2019. The case is proceeding in discovery.

The same organization amended a different complaint that it had filed in October 2019, which did not name Perrigo, on December 15, 2020, adding Perrigo as a defendant and asserting new allegations of alleged antitrust violations involving Perrigo and dozens of other generic pharmaceutical manufacturers. The allegations relating to Perrigo concern: Adapalene, Betamethasone Dipropionate, Bromocriptine Mesylate, Ciclopirox, Clindamycin Phosphate, Fenofibrate, Fluocinonide, Halobetasol Proprionate, Hydrocortisone Valerate, Imiquimod, Permethrin, Prochlorperazine Maleate, and Triamcinolone Acetonide.

The same organization filed a third complaint on December 15, 2020, naming Perrigo and dozens of other manufacturers alleging antitrust violations concerning generic pharmaceutical drugs. The allegations relating to Perrigo concern: Ammonium Lactate, Calcipotriene Betamethasone Dipropionate, Erythromycin, Fluticasone Propionate, Hydrocortisone Acetate, Methazolamide, Promethazine HCL, and Tacrolimus.

On January 16, 2019, a health insurance carrier filed a complaint in the U.S. District Court for the District of Minnesota alleging a conspiracy to fix prices of 30 products among 30 defendants. The only allegations specific to Perrigo concerned Clobetasol gel, Desonide, Econazole, Nystatin cream, and Nystatin ointment. Perrigo has not yet responded to the complaint, and responses are currently stayed. On December 15, 2020, the complaint was amended to add additional defendants and claims. The new allegations that concern Perrigo relate to Fluocinonide.

The same health insurance carrier filed a new complaint on December 15, 2020, naming Perrigo and dozens of other manufacturers alleging antitrust violations concerning generic pharmaceutical drugs. The allegations relating to Perrigo concern: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide.

On July 18, 2019, 87 health plans filed a Praecipe to Issue Writ of Summons in Pennsylvania state court to commence an action against 53 generic pharmaceutical manufacturers and 17 individuals, alleging antitrust violations concerning generic pharmaceutical drugs. While Perrigo was named as a defendant, no complaint has been filed and the precise allegations and products at issue have not been identified. Proceedings in the case, including the filing of a complaint, have been stayed at the request of the plaintiffs.

On December 11, 2019, a health care service company filed a complaint against Perrigo and 38 other pharmaceutical companies alleging an overarching conspiracy to fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other multi-district litigation ("MDL") complaints naming Perrigo: Clobetasol, Desonide, Econazole, and Nystatin cream/ointment. Perrigo has not yet responded to the complaint, and responses are currently stayed. On December 15, 2020, the complaint was amended to add additional defendants and claims. The new allegations relating to Perrigo concern: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fenofibrate, Fluocinonide, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide.

On December 16, 2019, a Medicare Advantage claims recovery company filed a complaint against Perrigo and 39 other pharmaceutical companies alleging an overarching conspiracy to fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other MDL complaints naming Perrigo: Clobetasol, Desonide, and Econazole. The complaint was originally filed in the District of Connecticut but has been consolidated into the MDL. Perrigo has not yet had the opportunity to respond to the complaint, and responses are currently stayed. On December 15, 2020, the complaint was amended to add additional defendants and claims. The new allegations relating to Perrigo concern: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Desoximetasone, Erythromycin, Fenofibrate, Fluocinonide, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate,

Hydrocortisone Valerate, Imiquimod, Methazolamide, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide.

On December 23, 2019, several counties in New York filed an amended complaint against Perrigo and 28 other pharmaceutical companies alleging an overarching conspiracy to fix, raise or stabilize prices of dozens products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other MDL complaints naming Perrigo: Clobetasol, Desonide, Econazole, and Nystatin. The complaint was originally filed in New York State court but was removed to federal court and has been consolidated into the MDL. Perrigo has not yet responded to the complaint, and responses are currently stayed. On December 15, 2020, the complaint was amended to add additional defendants and claims. The new allegations relating to Perrigo concern: Adapalene, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Mometasone Furoate, Nystatin, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide. On June 30, 2021, the counties filed a proposed revised second amended complaint. Perrigo has not yet responded to the complaint, and responses will be stayed.

On December 27, 2019, a healthcare management organization filed a complaint against Perrigo and 25 other pharmaceutical companies alleging an overarching conspiracy to fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other MDL complaints naming Perrigo: Clobetasol, Desonide, Econazole, and Nystatin. The complaint was filed originally in the Northern District of California but has been consolidated into the MDL. Perrigo has not yet responded to the complaint, and responses are currently stayed. On December 15, 2020, the complaint was amended to add additional defendants and claims. The new allegations relating to Perrigo concern: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fenofibrate, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide.

On March 1, 2020, Harris County of Texas filed a complaint against Perrigo and 29 other pharmaceutical companies alleging an overarching conspiracy to fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The products at issue that plaintiffs claim Perrigo manufacturers or sells include: Adapalene, Betamethasone Dipropionate, Ciclopirox, Clindamycin, Clobetasol, Desonide, Econazole, Ethinyl Estradiol/Levonorgestrel, Fenofibrate, Fluocinolone, Fluocinonide, Gentamicin, Glimepiride, Griseofulvin, Halobetasol Propionate, Hydrocortisone Valerate, Ketoconazole, Mupirocin, Nystatin, Olopatadine, Permethrin, Prednisone, Promethazine, Scopolamine, and Triamcinolone Acetonide. The complaint was originally filed in the Southern District of Texas but has been transferred to the MDL. Harris County amended its complaint in May 2020. Perrigo has not yet responded to the complaint, and responses are currently stayed.

In May 2020, seven health plans filed a writ of summons in the Pennsylvania Court of Common Pleas in Philadelphia concerning an as-yet unfiled complaint against Perrigo, three dozen other manufacturers, and seventeen individuals, concerning alleged antitrust violations in connection with the pricing and sale of generic prescription pharmaceutical products. No complaint has yet been filed, so the precise allegations and products at issue are not yet clear. In addition, Defendants are in the process of being served, and proceedings in the case will likely be stayed.

On June 9, 2020, a health insurance carrier filed a complaint against Perrigo and 25 other manufacturers alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other MDL complaints naming Perrigo: Clobetasol, Desonide, Econazole, and Nystatin. The complaint was filed in the Eastern District of Pennsylvania and has been transferred into the MDL. Perrigo has not yet responded to the complaint, and responses are currently stayed. On December 15, 2020, the complaint was amended to add additional defendants and claims. The new allegations relating to Perrigo concern: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fluocinonide, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide.

On July 9, 2020, a drugstore chain filed a complaint against Perrigo and 39 other pharmaceutical companies alleging an overarching conspiracy to fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other MDL complaints naming Perrigo: Clobetasol, Desonide, Econazole, and Nystatin. Perrigo is also listed in connection with Fenofibrate. The complaint was filed in the Eastern District of Pennsylvania and will be transferred into the MDL. Perrigo has not yet responded to the complaint, and responses are currently stayed. On December 15, 2020, the complaint was amended to add additional defendants and claims. The new allegations relating to Perrigo concern: Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fenofibrate, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide.

On August 27, 2020, Suffolk County of New York filed a complaint against Perrigo and 35 other manufacturers alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other MDL complaints naming Perrigo: Clobetasol, Desonide, Econazole, and Nystatin cream and ointment. The other products at issue that plaintiffs claim Perrigo manufacturers or sells include: Adapalene gel, Albuterol, Benazepril HCTZ, Clotrimazole, Diclofenac Sodium, Fenofibrate, Fluocinonide, Glimepiride, Ketoconazole, Meprobamate, Imiquimod, Triamcinolone Acetonide, Erythromycin/Ethyl Solution, Betamethasone Valerate, Ciclopirox Olamine, Terconazole, Hydrocortisone Valerate, Fluticasone Propionate, Desoximetasone, Clindamycin Phosphate, Halobetasol Propionate, Hydrocortisone Acetate, Promethazine HCL, Mometasone Furoate, and Amiloride HCTZ. The complaint was filed in the Eastern District of New York and has been transferred into the MDL. Perrigo has not yet responded to the complaint, and responses are currently stayed.

On September 4, 2020, a drug wholesaler and distributor filed a complaint against Perrigo and 39 other manufacturers alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin, Clobetasol, Desonide, Econazole, Erythromycin, Fenofibrate, Fluticasone, Halobetasol, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Mometasone furoate, Nystatin, Prochlorperazine, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide. The complaint was filed in the Eastern District of Pennsylvania and has been transferred into the MDL. Perrigo has not yet responded to the complaint, and responses are currently stayed.

On December 11, 2020, a drugstore chain filed a complaint against Perrigo and 45 other manufacturers alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on Adapalene, Ammonium Lactate, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Clobetasol, Desonide, Econazole, Erythromycin, Fenofibrate, Fluticasone Propionate, Halobetasol, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Nystatin, Permethrin, Prochlorperazine, Promethazine HCL, Tacrolimus, and Triamcinolone. The complaint was filed in the Eastern District of Pennsylvania and has been transferred into the MDL.

On December 14, 2020, a supermarket chain filed a complaint against Perrigo and 45 other manufacturers (as well as certain individuals) alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on Betamethasone Dipropionate, Bromocriptine Mesylate, Ciclopirox, Clindamycin Phosphate, Clobetasol, Desonide, Econazole, Fenofibrate, Halobetasol, Hydrocortisone Valerate, Nystatin, Permethrin, and Triamcinolone Acetonide. The complaint was filed in the Eastern District of Pennsylvania and has been transferred into the MDL.

On December 15, 2020, a drugstore chain filed a complaint against Perrigo and 45 other manufacturers alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The complaint lists 63 drugs that the chain purchased from Perrigo, but the product conspiracies allegedly involving Perrigo focus on Adapalene, Betamethasone Dipropionate,

Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Desonide, Econazole, Erythromycin, Fluocinonide, Fluticasone Propionate, Halobetasol, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Nystatin, Prochlorperazine, Promethazine HCL, Tacrolimus, and Triamcinolone. The complaint was filed in the Eastern District of Pennsylvania and has been transferred into the MDL.

On December 15, 2020, several counties in New York filed a complaint against Perrigo and 45 other pharmaceutical companies alleging an overarching conspiracy to fix, raise or stabilize prices of dozens products, most of which Perrigo neither makes nor sells. The allegations that concern Perrigo include: Adapalene, Betamethasone Dipropionate, Bromocriptine Mesylate, Calcipotriene Betamethasone Dipropionate, Ciclopirox, Clindamycin Phosphate, Erythromycin, Fluticasone Propionate, Halobetasol Proprionate, Hydrocortisone Acetate, Hydrocortisone Valerate, Imiquimod, Methazolamide, Mometasone Furoate, Nystatin, Permethrin, Prochlorperazine Maleate, Promethazine HCL, Tacrolimus, and Triamcinolone Acetonide. The complaint was originally filed in New York State court but has been removed to federal court and consolidated into the MDL. The counties filed an amended complaint on June 30, 2021.

State Attorney General Complaint

On June 10, 2020, the Connecticut Attorney General’s office filed a lawsuit on behalf of Connecticut and 50 other states and territories against Perrigo, 35 other generic pharmaceutical manufacturers, and certain individuals (including one former and one current Perrigo employee), alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of eighty products. The allegations against Perrigo focus on the following drugs: Adapalene Cream, Ammonium Lactate cream and lotion, Betamethasone dipropionate lotion, Bromocriptine tablets, Calcipotriene Betamethasone Dipropionate Ointment, Ciclopirox cream and solution, Clindamycin solution, Desonide cream and ointment, Econazole cream, Erythromycin base alcohol solution, Fluticasone cream and lotion, Halobetasol cream and ointment, Hydrocortisone Acetate suppositories, Hydrocortisone Valerate cream, Imiquimod cream, Methazolamide tablets, Nystatin ointment, Prochlorperazine suppositories, Promethazine HCL suppositories, Tacrolimus ointment, and Triamcinolone cream and ointment. The Complaint was filed in the District of Connecticut, but has been transferred into the MDL. Perrigo has not yet responded to the complaint, and responses are currently stayed. On May 7, 2021, the Court ruled that this case will move forward as a bellwether case. Perrigo has not yet responded to the complaint, and no schedule has been set for such responses.

Canadian Class Action Complaint

In June 2020, an end payor filed a class action in Ontario, Canada against Perrigo and 29 other manufacturers alleging an overarching conspiracy to allocate customers and/or fix, raise or stabilize prices of dozens of products, most of which Perrigo neither makes nor sells. The product conspiracies allegedly involving Perrigo focus on the same products as those involved in other MDL complaints naming Perrigo: Clobetasol, Desonide, Econazole, and Nystatin. In December 2020, Plaintiffs amended their complaint to add additional claims based on the State AG complaint of June 2020.

At this stage, we cannot reasonably estimate the outcome of the liability if any, associated with the claims listed above.

Securities Litigation

In the United States (cases related to events in 2015-2017)

On May 18, 2016, a shareholder filed a securities case against us and our former CEO, Joseph Papa, in the U.S. District Court for the District of New Jersey (Roofers’ Pension Fund v. Papa, et al.). The plaintiff purported to represent a class of shareholders for the period from April 21, 2015 through May 11, 2016, inclusive. The original complaint alleged violations of Securities Exchange Act sections 10(b) (and Rule 10b5) and 14(e) against both defendants and 20(a) control person liability against Mr. Papa. In general, the allegations concerned the actions taken by us and the former executive to defend against the unsolicited takeover bid by Mylan in the period from April 21, 2015 through November 13, 2015. The plaintiff also alleged that the defendants provided inadequate disclosure concerning alleged integration problems related to the Omega acquisition in the period from April 21, 2015 through May 11, 2016. On July 19, 2016, a different shareholder filed a securities class action against us and our former CEO, Joseph Papa, also in the District of New Jersey (Wilson v. Papa, et al.). The plaintiff purported to represent a

class of persons who sold put options on our shares between April 21, 2015 and May 11, 2016. In general, the allegations and the claims were the same as those made in the original complaint filed in the Roofers' Pension Fund case described above. On December 8, 2016, the court consolidated the Roofers' Pension Fund case and the Wilson case under the Roofers' Pension Fund case number. In February 2017, the court selected the lead plaintiffs for the consolidated case and the lead counsel to the putative class. In March 2017, the court entered a scheduling order.

On June 21, 2017, the court-appointed lead plaintiffs filed an amended complaint that superseded the original complaints in the Roofers’ Pension Fund case and the Wilson case. In the amended complaint, the lead plaintiffs seek to represent three classes of shareholders: (i) shareholders who purchased shares during the period from April 21, 2015 through May 3, 2017 on the U.S. exchanges; (ii) shareholders who purchased shares during the same period on the Tel Aviv exchange; and (iii) shareholders who owned shares on November 12, 2015 and held such stock through at least 8:00 a.m. on November 13, 2015 (the final day of the Mylan tender offer) regardless of whether the shareholders tendered their shares. The amended complaint names as defendants us and 11 current or former directors and officers of Perrigo (Mses. Judy Brown, Laurie Brlas, Jacqualyn Fouse, Ellen Hoffing, and Messrs. Joe Papa, Marc Coucke, Gary Cohen, Michael Jandernoa, Gerald Kunkle, Herman Morris, and Donal O’Connor). The amended complaint alleges violations of Securities Exchange Act sections 10(b) (and Rule 10b‑5) and 14(e) against all defendants and 20(a) control person liability against the 11 individuals. In general, the allegations concern the actions taken by us and the former executives to defend against the unsolicited takeover bid by Mylan in the period from April 21, 2015 through November 13, 2015 and the allegedly inadequate disclosure throughout the entire class period related to purported integration problems related to the Omega acquisition, alleges incorrect reporting of organic growth at the Company and at Omega, alleges price fixing activities with respect to six generic prescription pharmaceuticals, and alleges improper accounting for the Tysabri® royalty stream. The amended complaint does not include an estimate of damages. During 2017, the defendants filed motions to dismiss, which the plaintiffs opposed. On July 27, 2018, the court issued an opinion and order granting the defendants’ motions to dismiss in part and denying the motions to dismiss in part. The court dismissed without prejudice defendants Laurie Brlas, Jacqualyn Fouse, Ellen Hoffing, Gary Cohen, Michael Jandernoa, Gerald Kunkle, Herman Morris, Donal O’Connor, and Marc Coucke. The court also dismissed without prejudice claims arising from the Tysabri® accounting issue described above and claims alleging incorrect disclosure of organic growth described above. The defendants who were not dismissed are Perrigo Company plc, Joe Papa, and Judy Brown. The claims (described above) that were not dismissed relate to the integration issues regarding the Omega acquisition, the defense against the Mylan tender offer, and the alleged price fixing activities with respect to six generic prescription pharmaceuticals. The defendants who remain in the case (the Company, Mr. Papa, and Ms. Brown) have filed answers denying liability, and the discovery stage of litigation began in late 2018. Discovery in the class action ended on January 31, 2021. In early April 2021, the defendants filed various post-discovery motions, including summary judgment motions; the briefing of which was completed in early July 2021. The motions are now before the court. We intend to defend the lawsuit vigorously.

On November 14, 2019, the court granted the lead plaintiffs’ motion and certified three classes for the case: (i) all those who purchased shares between April 21, 2015 through May 2, 2017 inclusive on a U.S. exchange and were damaged thereby; (ii) all those who purchased shares between April 21, 2015 through May 2, 2017 inclusive on the Tel Aviv exchange and were damaged thereby; and (iii) all those who owned shares as of November 12, 2015 and held such stock through at least 8:00 a.m. on November 13, 2015 (whether or not a person tendered shares in response to the Mylan tender offer) (the "tender offer class"). Defendants filed a petition for leave to appeal in the Third Circuit challenging the certification of the tender offer class. On April 30, 2020, the Third Circuit denied leave to appeal. The District Court has approved the issuance of a notice of the pendency of the class action, and the notice has been sent to shareholders who are eligible to participate in the classes.

Unless otherwise noted, each of the lawsuits discussed in the following sections is pending in the U.S. District Court for the District of New Jersey and has been assigned to the same judges hearing the Roofers’ Pension Fund case. The allegations in the complaints relate to events during certain portions of the 2015 through 2017 calendar years, including the period of the Mylan tender offer. All but one of these lawsuits allege violations of federal securities laws, but none are class actions. One lawsuit (Highfields) alleges only state law claims. Discovery in all these cases, except Starboard Value and Highfields, is underway and currently scheduled to end in early October 2021. We intend to defend all these lawsuits vigorously.

Carmignac, First Manhattan and Similar Cases. The following seven cases were filed by the same law firm and generally make the same factual assertions but, at times, differ as to which securities laws violations they allege:

Case	Date Filed
Carmignac Gestion, S.A. v. Perrigo Company plc, et al.	11/1/2017
First Manhattan Co. v. Perrigo Company plc, et al.	2/16/2018; amended 4/20/2018
Nationwide Mutual Funds, et al. v. Perrigo Company plc, et al.	10/29/2018
Schwab Capital Trust, et al. v. Perrigo Company plc, et al.	1/31/2019
Aberdeen Canada Funds -- Global Equity Fund, et al. v. Perrigo Company plc, et al.	2/22/2019
Principal Funds, Inc., et al. v. Perrigo Company plc, et al.	3/5/2020
Kuwait Investment Authority, et al. v. Perrigo Company plc, et al.	3/31/2020

The original complaints in the Carmignac case and the First Manhattan case named Perrigo, Mr. Papa, Ms. Brown, and Mr. Coucke as defendants. Mr. Coucke was dismissed as a defendant after the plaintiffs agreed to apply the July 2018 ruling in the Roofers' Pension Fund case to these two cases. The complaints in each of the other cases name only Perrigo, Mr. Papa, and Ms. Brown as defendants.

Each complaint asserts claims under Sections 10(b) (and Rule 10b-5 thereunder) and all cases except Aberdeen assert claims under Section 14(e) of the Securities Exchange Act against all defendants, as well as control person liability under Section 20(a) of the Securities Exchange Act against the individual defendants. The control person claims against the individual defendants are limited to the period from April 2015 through April 2016 in the Carmignac case. The complaints in the Carmignac and First Manhattan cases also assert claims under Section 18 of the Exchange Act.

Each complaint alleges inadequate disclosures concerning the valuation and integration of Omega, the financial guidance we provided, our reporting about the generic prescription pharmaceutical business and its prospects, and the activities surrounding the efforts to defeat the Mylan tender offer during 2015, and, in each of the cases other than Carmignac, alleged price fixing activities with respect to six generic prescription pharmaceuticals. The First Manhattan complaint also alleges improper accounting for the Tysabri® asset. With the exception of Carmignac, each of these cases relates to events during the period from April 2015 through May 2017. Many of the allegations in these cases overlap with the allegations of the June 2017 amended complaint in the Roofers’ Pension Fund case, though the Nationwide Mutual, Schwab Capital, Aberdeen, Principal Funds and Kuwait complaints do not include the factual allegations that the court dismissed in the July 2018 ruling in the Roofers' Pension Fund case.

After the court issued its July 2018 opinion in the Roofers’ Pension Fund case, the parties in Carmignac and First Manhattan conferred and agreed that the ruling in the Roofers’ Pension Fund case would apply equally to the common allegations in their cases. The later filed cases adopted a similar posture. The defendants in the Carmignac and other cases listed above filed motions to dismiss addressing the additional allegations in such cases. On July 31, 2019, the court granted such motions to dismiss in part and denied them in part. That ruling applies to each of the above cases. The defendants have filed answers in each case denying liability. Each case is currently in the discovery phase.

Mason Capital, Pentwater and Similar Cases. The following eight cases were filed by the same law firm and generally make the same factual allegations:

Case	Date Filed
Mason Capital L.P., et al. v. Perrigo Company plc, et al.	1/26/2018
Pentwater Equity Opportunities Master Fund Ltd., et al.  v. Perrigo Company plc, et al.	1/26/2018
WCM Alternatives: Event-Drive Fund, et al. v. Perrigo Co., plc, et al.	11/15/2018
Hudson Bay Master Fund Ltd., et al. v. Perrigo Co., plc, et al.	11/15/2018
Discovery Global Citizens Master Fund, Ltd., et al. v. Perrigo Co. plc, et al.	12/18/2019
York Capital Management, L.P., et al. v. Perrigo Co. plc, et al.	12/20/2019
Burlington Loan Management DAC v. Perrigo Co. plc, et al.	2/12/2020
Universities Superannuation Scheme Limited v. Perrigo Co. plc, et al.	3/2/2020

The complaints in the Mason Capital case and the Pentwater case originally named Perrigo and 11 current or former directors and officers of Perrigo as defendants. In the July 2018 Roofers’ Pension Fund ruling, the court dismissed without prejudice each of the defendants other than Perrigo, Mr. Papa and Ms. Brown from that case; these plaintiffs later agreed that this ruling would apply to their cases as well. The complaints in each of the other cases in the above table name only Perrigo, Mr. Papa, and Ms. Brown as defendants.

Each complaint asserts claims under Section 14(e) of the Securities Exchange Act against all defendants, as well as control person liability under Section 20(a) of the Securities Exchange Act against the individual defendants. The complaints in the WCM case and the Universities Superannuation Scheme case also assert claims under Section 10(b) of the Exchange Act and Rule 10b-5 thereunder.

Each complaint alleges inadequate disclosure during the tender offer period in 2015 and at various times concerning valuation and integration of Omega, the financial guidance provided by us during that period, alleged price fixing activities with respect to six generic prescription pharmaceuticals, and alleged improper accounting for the Tysabri® asset. The WCM complaint also makes these allegations for the period through May 2017 and the Universities Superannuation Scheme complaint also concerns certain times during 2016. Many of the factual allegations in these cases overlap with the allegations of the June 2017 amended complaint in the Roofers’ Pension Fund case, and the Mason Capital and Pentwater cases include factual allegations similar to those in the Carmignac case described above.

After the court issued its July 2018 opinion in the Roofers’ Pension Fund case, the parties in each of the above cases conferred and agreed that the ruling in the Roofers’ Pension Fund case would apply equally to the common allegations in their cases. The defendants in each of these cases have filed answers denying liability, and each of the cases is currently in the discovery phase.

Harel Insurance and TIAA-CREF Cases. The following two cases were filed by the same law firm and generally make the same factual allegations relating to the period from February 2014 through May 2017 (in the Harel case) and from August 2014 through May 2017 (in the TIAA-CREF case):

Case	Date Filed
Harel Insurance Company, Ltd., et al. v. Perrigo Company plc, et al.	2/13/2018
TIAA-CREF Investment Management, LLC., et al. v. Perrigo Company plc, et al.	4/20/2018

The complaints in the Harel and TIAA-CREF cases originally named Perrigo and 13 current or former directors and officers of Perrigo as defendants (adding two more individual defendants not sued in the other cases described in this section). In the July 2018 Roofers’ Pension Fund ruling, the court dismissed without prejudice 8 of the 11 defendants other than Perrigo, Mr. Papa and Ms. Brown from that case. These plaintiffs later agreed that that ruling would apply to these cases as well and also dismissed their claims against the two additional individuals that only these plaintiffs had named as defendants.

Each complaint asserts claims under Sections 10(b) and 14(e) of the Securities Exchange Act and Rule 10b-5 thereunder against all defendants, as well as control person liability under Section 20(a) of the Securities

Exchange Act against the individual defendants. The complaint in the Harel case also asserts claims based on Israeli securities laws.

Each of the complaints alleges inadequate disclosure around the tender offer events in 2015 and at various times during the relevant periods concerning valuation and integration of Omega, the financial guidance provided by us during that period, alleged price fixing activities with respect to six generic prescription pharmaceuticals, and alleged improper accounting for the Tysabri® asset from February 2014 until the withdrawal of past financial statements in April 2017.

After the court issued its July 2018 opinion in the Roofers’ Pension Fund case, the parties in the Harel and TIAA-CREF cases conferred and agreed that such ruling would apply equally to the common allegations in their cases. The defendants in each of these cases have filed answers denying liability, and each of the cases is currently in the discovery phase.

Other Cases Related to Events in 2015-2017. Certain allegations in the following three cases also overlap with the allegations of the June 2017 amended complaint in the Roofers' Pension Fund case and with allegations in one or more of the other individual cases described in the sections above:

Case	Date Filed
Sculptor Master Fund (f/k/a OZ Master Fund, Ltd.), et al. v. Perrigo Company plc, et al.	2/6/2019
Highfields Capital I LP, et al. v. Perrigo Company plc, et al.	6/4/2020
BlackRock Global Allocation Fund, Inc., et al. v. Perrigo Co. plc, et al.	4/21/2020
Starboard Value and Opportunity C LP, et al. v. Perrigo Company plc, et al.	2/25/2021

Each of the above complaints names Perrigo, Mr. Papa, and Ms. Brown as defendants.

The Sculptor Master Fund (formerly OZ) complaint asserts claims under Sections 10(b) and 14(e) of the Securities Exchange Act and Rule 10b-5 thereunder against all defendants, as well as control person liability under Section 20(a) of the Securities Exchange Act against the individual defendants. The parties have agreed that the court's rulings in July 2018 in the Roofers' Pension Fund case and in July 2019 in the Carmignac and related cases will apply to this case as well. The defendants have filed answers denying liability. The plaintiffs are participating in the discovery proceedings in the Roofers' Pension Fund case and the various individual cases described above.

The BlackRock Global complaint also asserts claims under Securities Exchange Act section 10(b) (and SEC Rule 10b-5) and section 14(e) against all defendants and section 20(a) control person claims against the individual defendants largely based on the same events during the period from April 2015 through May 2017. Plaintiffs contend that the defendants provided inadequate disclosure during the tender offer period in 2015 and point to disclosures at various times during the period concerning valuation and integration of Omega, the financial guidance provided by us during that period, alleged price fixing activities with respect to six generic prescription pharmaceuticals, alleged lower performance in the generic prescription drug business during 2015 and alleged improper accounting for the Tysabri® asset. The defendants have filed answers denying liability. The plaintiffs are participating in the discovery proceedings in the Roofers' Pension Fund case and the various individual cases described above.

The Starboard Value and Opportunity C LP complaint also asserts claims under Securities Exchange Act section 10(b) (and SEC Rule 10b-5) against all defendants and section 20(a) control person claims against the individual defendants based on events related to alleged price fixing activities with respect to generic prescription drugs during periods that overlap to some extent with the period alleged in the various other cases described above. Plaintiffs contend that the defendants provided inadequate disclosure during 2016 about generic prescription drug business and those alleged matters. The lawsuit was filed on February 25, 2021; but by agreement the case was administratively terminated by the court in June 2021 pending a decision on the same defendants’ motions currently pending before the court in the Roofers' Pension Fund case described above.

The Highfields federal case complaint asserted claims under Sections 14(e) and 18 of the Securities Exchange Act against all defendants, as well as control person liability under Section 20(a) of the Securities Exchange Act against the individual defendants. As originally filed in the U.S. District Court for the District of Massachusetts, the Highfields complaint also alleged claims under the Massachusetts Unfair Business Methods

Law (chapter 93A) and Massachusetts common law claims of tortious interference with prospective economic advantage, common law fraud, negligent misrepresentation, and unjust enrichment. The factual allegations generally were similar to the factual allegations in the Amended Complaint in the Roofers' Pension Fund case described above, except that the Highfields plaintiffs did not include allegations about alleged collusive pricing of generic prescription drugs. In March 2020, the District of Massachusetts court granted defendants’ motion and transferred the case to the U.S. District Court for the District of New Jersey so that the activities in the case could proceed in tandem with the other cases in the District of New Jersey described above. After the transfer, in June 2020, the Highfields plaintiffs voluntarily dismissed their federal lawsuit. The same Highfields plaintiffs the same day then filed a new lawsuit in Massachusetts State Court asserting the same factual allegations as in their federal lawsuit and alleging only Massachusetts state law claims under the Massachusetts Unfair Business Methods Law (chapter 93A) and Massachusetts common law claims of tortious interference with prospective economic advantage, common law fraud, negligent misrepresentation, and unjust enrichment. Defendants’ motion to dismiss was fully briefed as of late November 2020, argument occurred in early May 2021, and the motion is pending before the court.

In Israel (cases related to events in 2015-2017)

Because our shares are traded on the Tel Aviv exchange under a dual trading arrangement, we are potentially subject to securities litigation in Israel. Three cases were filed; one was voluntarily dismissed in each of 2017 and 2018 and one was stayed in 2018. We are consulting with Israeli counsel about our response to these allegations and we intend to defend this case vigorously.

On June 28, 2017, a plaintiff filed a complaint in Tel Aviv District Court styled Israel Elec. Corp. Employees’ Educ. Fund v. Perrigo Company plc, et al. The lead plaintiff seeks to represent a class of shareholders who purchased Perrigo stock on the Tel Aviv exchange during the period from April 24, 2015 through May 3, 2017 and also a claim for those that owned shares on the final day of the Mylan tender offer (November 13, 2015). The amended complaint names as defendants the Company, Ernst & Young LLP (the Company’s auditor), and 11 current or former directors and officers of Perrigo (Mses. Judy Brown, Laurie Brlas, Jacqualyn Fouse, Ellen Hoffing, and Messrs. Joe Papa, Marc Coucke, Gary Cohen, Michael Jandernoa, Gerald Kunkle, Herman Morris, and Donal O’Connor). The complaint alleges violations under U.S. securities laws of Securities Exchange Act sections 10(b) (and Rule 10b‑5) and 14(e) against all defendants and 20(a) control person liability against the 11 individuals or, in the alternative, under Israeli securities laws. In general, the allegations concern the actions taken by us and our former executives to defend against the unsolicited takeover bid by Mylan in the period from April 21, 2015 through November 13, 2015 and the allegedly inadequate disclosure concerning purported integration problems related to the Omega acquisition, alleges incorrect reporting of organic growth at the Company, alleges price fixing activities with respect to six generic prescription pharmaceuticals, and alleges improper accounting for the Tysabri® royalty stream. The plaintiff indicates an initial, preliminary class damages estimate of 2.7 billion NIS (approximately $760.0 million at 1 NIS = 0.28 cents). After the other two cases filed in Israel were voluntarily dismissed, the plaintiff in this case agreed to stay this case pending the outcome of the Roofers’ Pension Fund case in the U.S. (described above). The Israeli court approved the stay, and this case is now stayed. We intend to defend the lawsuit vigorously.

In the United States (cases related to Irish Tax events)

On January 3, 2019, a shareholder filed a complaint against the Company, our CEO Murray Kessler, and our former CFO Ronald Winowiecki in the U.S. District Court for the Southern District of New York (Masih v. Perrigo Company, et al.). Plaintiff purported to represent a class of shareholders for the period November 8, 2018 through December 20, 2018, inclusive. The complaint alleged violations of Securities Exchange Act section 10(b) (and Rule 10b‑5) against all defendants and section 20(a) control person liability against the individual defendants. In general the allegations contended that the Company, in its Form 10-Q filed November 8, 2018, disclosed information about an October 31, 2018 audit finding letter received from Irish tax authorities but failed to disclose enough material information about that letter until December 20, 2018, when we filed a current report on Form 8‑K about Irish tax matters. The plaintiff did not provide an estimate of class damages. The court selected lead plaintiffs and changed the name of the case to In re Perrigo Company plc Sec. Litig. The lead plaintiffs filed an amended complaint on April 12, 2019, which named the same defendants, asserted the same class period, and invoked the same Exchange Act sections. The amended complaint generally repeated the allegations of the original complaint with a few additional details and adds that the defendants also failed to timely disclose the Irish tax authorities’ Notice of Amended Assessment received on November 29, 2018. Defendants filed a motion to dismiss on May 3, 2019. On May 31, 2019, the plaintiffs filed a second amended complaint, which asserted a longer class period (March 1, 2018 through December 20, 2018) and added one additional individual defendant, former CEO Uwe Roehrhoff. In general, the second amended complaint contends that Perrigo’s disclosures about the Irish tax audit were inadequate beginning with Perrigo’s 10-K filed on March 1, 2018 through December 20, 2018 and repeats many of the allegations of the April 2019 amended complaint. The second amended complaint alleges violations of Securities Exchange Act section 10(b) (and SEC Rule 10b-5) against all defendants and section 20(a) control person liability against the three individual defendants. All defendants filed a joint motion to dismiss, and the motion was fully briefed. On January 23, 2020, the court granted the motion to dismiss in part and denied it in part, dismissing Mr. Roehrhoff as a defendant and dismissing allegations of inadequate disclosures related to the audit by Irish Revenue during the period March 2018 through October 30, 2018. The court permitted the plaintiffs to pursue their claims against us, Mr. Kessler, and Mr. Winowiecki related to disclosures after Perrigo received the October 30, 2018 audit findings letter and later events through December 20, 2018. The defendants filed answers on February 13, 2020 denying liability, and the court issued a scheduling order on March 3, 2020 that has been subsequently modified. Discovery on the remaining issues ended in early March 2021. Plaintiffs filed a motion for class certification, which was granted in September 2020. In January 2021, class plaintiffs filed a motion for leave to file a third amended complaint in an effort to revive their claim that the disclosure of the audit during the period from March 1, 2018 to October 30, 2018 was also inadequate. The court denied the motion in February 2021. Defendants filed motions for summary judgement and other post discovery motions on March 31, 2021 and plaintiffs filed cross-motions of the same type on the same day. All motions were fully briefed by late May 2021. During the week of July 11, 2021, the Court issued various opinions and orders denying some of the motions by both parties, and granting in part certain motions by plaintiffs. Defendants filed a motion for reconsideration for some of the rulings in late July, and the court ordered briefing to be completed in mid-August. The court also indicated that the parties should prepare for trial in mid-October 2021 (subject to COVID-19 developments), without setting an exact trial date. We intend to defend the lawsuit vigorously.

In Israel (case related to Irish Tax events)

On December 31, 2018, a shareholder filed an action against the Company, our CEO Murray Kessler, and our former CFO Ronald Winowiecki in Tel Aviv District Court (Baton v. Perrigo Company plc, et. al.). The case is a securities class action brought in Israel making similar factual allegations for the same period as those asserted in the In re Perrigo Company plc Sec. Litig case in New York federal court. This case alleges that persons who invested through the Tel Aviv stock exchange can assert claims under Israeli securities law that will follow the liability principles of Sections 10(b) and 20(a) of the U.S. Securities Exchange Act. The plaintiff does not provide an estimate of class damages. In 2019, the court granted two requests by Perrigo to stay the proceedings pending the resolution of proceedings in the United States. Perrigo filed a further request for a stay in February 2020, and the court granted the stay indefinitely. The plaintiff filed a motion to lift the stay then later agreed that the case should remain stayed through February 2021. In late February 2021, Perrigo filed a motion to extend the stay to mid-May 2021, and plaintiff later agreed to the request. The court extended the stay to mid-May 2021. The court later extended the stay. Defendants provided an update to the court by August 8, and the court requested plaintiff's views by August 29, 2021. We intend to defend the lawsuit vigorously.

Claim Arising from the Omega Acquisition

On December 16, 2016, we and Perrigo Ireland 2 brought an arbitral claim ("Claim") against Alychlo NV ("Alychlo") and Holdco I BE NV (together the "Sellers") in accordance with clause 26.2 of the Share Purchase Agreement dated November 6, 2014 ("SPA") and the rules of the Belgian Centre for Arbitration and Mediation ("CEPANI"). Our Claim relates to the accuracy and completeness of information about Omega provided by the Sellers as part of the sale process, the withholding of information by the Sellers during that process and breaches of Sellers’ warranties. We are seeking monetary damages from the Sellers. The Sellers served their respective responses to the Claim on February 20, 2017. In its response, Alychlo has asserted a counterclaim for monetary damages contending that we breached a warranty in the SPA and breached the duty of good faith in performing the SPA. Alychlo subsequently filed papers seeking permission to introduce an additional counterclaim theory of recovery related to the Irish tax issues disclosed by the Company such that if the position of the Irish tax authorities prevails, Alychlo would have further basis for its counterclaim against Perrigo. In June 2019, the Tribunal denied permission for Alychlo to introduce the additional counterclaim and dismissed certain aspects of the original Alychlo counterclaim. There can be no assurance that our Claim will be successful, and the Sellers deny liability for the Claim. To the extent that aspects of Alychlo’s counterclaim survived the Tribunal’s ruling in June 2019, we deny that Alychlo is entitled to any relief (including monetary relief). The ongoing arbitration proceedings are confidential as required by the SPA and the rules of the CEPANI.

Other Matters

Talcum Powder

The Company has been named, together with other manufacturers, in product liability lawsuits in state courts in California, Florida, Missouri, New Jersey, Louisiana and Illinois alleging that the use of body powder products containing talcum powder causes mesothelioma and lung cancer due to the presence of asbestos. All but one of these cases involve legacy talcum powder products that have not been manufactured by the Company since 1999. One of the pending actions involves a current prescription product that contains talc as an excipient. As of July 13, 2021, the Company is currently named in 44 individual lawsuits seeking compensatory and punitive damages and has accepted a tender for a portion of the defense costs and liability from a retailer for one additional matter. The Company has several defenses and intends to aggressively defend these lawsuits. Trials for these lawsuits are currently scheduled throughout 2021, 2022 and 2023, with the earliest to begin in September 2021.

Ranitidine

After regulatory bodies announced worldwide that ranitidine may potentially contain N-nitrosodimethylamine ("NDMA"), a known environmental contaminant, the Company promptly began testing its externally-sourced ranitidine API and ranitidine-based products. On October 8, 2019, the Company halted shipments of the product based upon preliminary results and on October 23, 2019, the Company made the decision to conduct a voluntary retail market withdrawal.

In February 2020, the resulting actions involving Zantac® and other ranitidine products were transferred for coordinated pretrial proceedings to a Multi-District Litigation (In re Zantac®/Ranitidine Products Liability Litigation MDL No. 2924) in the U.S. District Court for the Southern District of Florida. After the Company successfully moved to dismiss the first set of Master Complaints in the MDL, it now includes three: 1) an Amended Master Personal Injury Complaint; 2) a Consolidated Amended Consumer Economic Loss Class Action Complaint; and 3) a Consolidated Medical Monitoring Class Action Complaint. All three name the Company. Plaintiffs appealed one of the original Master Complaints, the Third-Party Payor Complaint, and two individual plaintiffs appealed their individual personal injury claims on limited grounds. The Company is not named in the appeals.

As of July 13, 2021, the Company has been named in two hundred forty-five (245) of the MDL’s consolidated personal injury lawsuits tied to various federal courts alleging that plaintiffs developed various types of cancers or are placed at higher risk of developing cancer as a result of ingesting products containing ranitidine. The Company is named in these lawsuits with manufacturers of the national brand Zantac® and other manufacturers of ranitidine products, as well as distributors, repackagers, and/or retailers. Plaintiffs seek compensatory and punitive damages, and in some instances seek applicable remedies under state consumer protection laws.

The Company has also been named in a Complaint brought by the New Mexico Attorney General based on the following theories: violation of a New Mexico public nuisance statute, NMSA 30-8-1 to -14; common law nuisance; and negligence and gross negligence. The Company is named in this lawsuit with manufacturers of the national brand Zantac® and other manufacturers of ranitidine products and/or retailers. Brand name manufactures named in the lawsuit also face claims under the state’s Unfair Practices & False Advertising acts. Likewise, the Company has also been named in a Complaint brought by the Mayor and City Council of Baltimore, along with manufacturers of the national brand Zantac® and other manufacturers of ranitidine products and/or retailers. This action brings claims under the Maryland Consumer Protection Act against the brand name defendants only, as well as public nuisance and negligence for the remaining defendants. The Company was originally able to consolidate the New Mexico and Baltimore Actions to the MDL, however both actions were recently remanded to state court. The Company plans to file motions to dismiss in the New Mexico and Baltimore actions in the near future, and will continue to vigorously defend each of these lawsuits.

Some of the Company’s retailer customers are seeking indemnity from the Company for a portion of their defense costs and liability relating to these cases.

On June 30, 2021, the Court dismissed all claims against the retail and distributor defendants with prejudice, thereby reducing the Company’s potential for exposure and liability related to possible indemnification. On July 8, 2021, the Court dismissed all claims against the Company with prejudice. The Company believes an appeal of these dismissal orders to the U.S. Court of Appeals for the 11th Circuit is likely, as are possible state level claims related to the theories advanced in the MDL litigation. The Company will continue to vigorously defend each of these lawsuits.

Acetaminophen

The Company has received requests for indemnification and defense of several consumer fraud claims involving its store brand infants’ and children’s acetaminophen products. In September 2020, the Company was directly named as a defendant in one suit filed in the Central District of California. The Company was recently named in a cross complaint by a retailer for contractual indemnity in California Superior Court, Alameda County. The Company has also received 16 different claims for indemnification or defense from 10 different retailers for lawsuits filed in California, Illinois, Florida and Pennsylvania, with nationwide class action allegations.

The Plaintiffs generally allege that the children’s and infants’ acetaminophen products have identical drug concentration amounts, yet the infants’ product costs more than the children’s product and consumers have been misled into purchasing the more expensive product. The Company will aggressively defend the suits in which it is named and is continuing to assess whether, or to what extent, the Company may contribute in the lawsuits filed against its retail customers.

Guarantee Liability Related to The Israel API Sale

During the year ended December 31, 2017, we completed the sale of our Israel API business to SK Capital, resulting in a guarantee liability of $13.8 million, classified as a Level 3 liability within the fair value hierarchy. Pursuant to the agreement, we will be reimbursed for tax receivables for tax years prior to closing and will need to reimburse SK Capital for the settlement of any uncertain tax liability positions for tax years prior to closing. In addition, after closing and going forward, the Israel API business will be assessed by and liable to the ITA for any audit findings. We are no longer the primary obligor on the liabilities transferred to SK Capital, but we have provided a guarantee on certain obligations. During the three months ended July 3, 2021, we paid $12.5 million to resolve the tax liability indemnity for the tax year ended December 31, 2017 (refer to Note 15). At July 3, 2021 and December 31, 2020, the remaining guarantee liability was $0.6 million and $13.2 million, respectively.

Contingencies Accruals

As a result of the matters discussed in this Note, the Company has established a loss accrual for litigation contingencies where we believe a loss to be probable and for which an amount of loss can be reasonably estimated. However, we cannot determine a reasonable estimate of the maximum possible loss or range of loss for these matters given that they are at various stages of the litigation process and each case is subject to inherent uncertainties of litigation. At July 3, 2021, the loss accrual for litigation contingencies reflected on the balance sheet in Other accrued liabilities was approximately $65.0 million. The Company also recorded an insurance recovery

receivable reflected on the balance sheet in Prepaid expenses and other current assets of approximately $56.2 million related to these litigation contingencies because it believes such amount is recoverable based on communications with its insurers to date; however, the Company may erode this insurance receivable as it incurs defense costs associated with defending this matter. The Company’s management believes these accruals for contingencies are reasonable and sufficient based upon information currently available to management; however, there can be no assurance that final costs related to these contingencies will not exceed current estimates or that all of the final costs related to these contingencies will be covered by insurance. (See "Insurance Coverage Litigation," below.) In addition, we have other litigation matters pending for which we have not recorded any accruals because our potential liability for those matters is not probable or cannot be reasonably estimated based on currently available information. For those matters where we have not recorded an accrual but a loss is reasonably possible, we cannot determine a reasonable estimate of the maximum possible loss or range of loss for these matters given that they are at various stages of the litigation process and each case is subject to the inherent uncertainties of litigation.

Insurance Coverage Litigation

In May 2021 insurers on multiple policies of D&O insurance filed an action in the High Court in Dublin against the Company and multiple current and former directors and officers of the Company seeking declaratory judgments on certain coverage issues. Those coverage issues include claims that policies for periods beginning in December 2015 and December 2016, respectively, do not have to provide coverage for the securities actions described above pending in the District of New Jersey or in Massachusetts state court concerning the events of 2015-2017. The policy for the period beginning December 2014 is currently providing coverage for those matters, and the litigation would not affect that existing coverage. However, if the plaintiffs are successful, the total amount of insurance coverage available to defend such lawsuits and to satisfy any judgment or settlement costs thereunder would be limited to one policy period. The insurers’ lawsuit also challenges coverage for Krueger derivatively on behalf of nominal defendant Perrigo Company plc v. Alford et al., a prior derivative action filed in the District of New Jersey that was dismissed in August 2020, and for the counterclaims brought in the Omega arbitration proceedings. We intend to defend the lawsuit vigorously.

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Restructuring Charges

6 Months Ended

Jul. 03, 2021

Restructuring Charges [Abstract]

Restructuring Charges

RESTRUCTURING CHARGES

We periodically take action to reduce redundant expenses and improve operating efficiencies. Restructuring activity includes severance, lease exit costs, and related consulting fees. The following reflects our restructuring activity (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Beginning balance	$	6.2	$	16.0	$	9.1	$	19.5
Additional charges	9.0		0.7		10.7		0.7
Payments	(5.1)		(7.3)		(9.5)		(10.8)
Non-cash adjustments	0.1		—		(0.1)		—
Ending balance	$	10.2	$	9.4	$	10.2	$	9.4

The charges incurred during the three and six months ended July 3, 2021 and June 27, 2020 were primarily associated with actions taken to streamline the organization.

There were no other material restructuring programs for the three and six months ended July 3, 2021 and June 27, 2020. All charges are recorded in Restructuring expense on the Condensed Consolidated Statements of Operations. The remaining $10.2 million liability for employee severance benefits is expected to be paid within the next year.

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Segment Information

6 Months Ended

Jul. 03, 2021

Segment Reporting [Abstract]

Segment Information

SEGMENT INFORMATION

Our segments reflect the way in which our management makes operating decisions, allocates resources, and manages the growth and profitability of the Company. As discussed in Note 8, as of March 1, 2021, the financial results and assets and liabilities of the RX business are classified as discontinued operations in the Condensed Consolidated Statements of Operations and Condensed Consolidated Balance Sheets. As discussed in Note 9, as of July 3, 2021, the assets and liabilities of the Latin American businesses were classified as held for sale. The RX business and Latin American businesses assets held-for-sale are included below in the summary of total assets.

The tables below show select financial measures by reporting segment (in millions):

	Total Assets
	July 3, 2021		December 31, 2020
CSCA	$	4,417.1	$	4,585.1
CSCI	4,723.9		4,872.4
Held for sale	2,089.3		2,030.9
Total	$	11,230.3	$	11,488.4

	Three Months Ended
	July 3, 2021						June 27, 2020
	Net Sales		Operating Income (Loss)		Intangible Asset Amortization		Net Sales		Operating Income (Loss)		Intangible Asset Amortization
CSCA	$	622.3	$	(72.0)	$	12.9	$	627.7	$	104.6	$	13.2
CSCI	358.8		1.3		40.5		321.1		10.5		38.4
Unallocated	—		(55.2)		—		—		(52.4)		—
Continuing Operations Total	$	981.1	$	(125.9)	$	53.4	$	948.8	$	62.7	$	51.6

	Six Months Ended
	July 3, 2021						June 27, 2020
	Net Sales		Operating Income (Loss)		Intangible Asset Amortization		Net Sales		Operating Income (Loss)		Intangible Asset Amortization
CSCA	$	1,262.8	$	23.6	$	25.8	$	1,328.2	$	226.7	$	27.5
CSCI	728.3		18.8		80.8		703.8		35.6		76.7
Unallocated	—		(117.0)		—		—		(113.2)		—
Continuing Operations Total	$	1,991.1	$	(74.6)	$	106.6	$	2,032.0	$	149.1	$	104.2

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Subsequent Events

6 Months Ended

Jul. 03, 2021

Subsequent Events [Abstract]

Subsequent Events

SUBSEQUENT EVENTS

RX Business

On July 6, 2021, we completed the sale of the RX Business to Altaris for aggregate consideration of $1.55 billion, which we estimate will result in an immaterial pre-tax gain during the three months ending October 2, 2021, subject to final settlement of the sale proceeds. The final purchase price and gain or loss on the sale are subject to customary adjustments for cash, debt, working capital and transaction expenses, along with computation of income tax on the sale. We expect to finalize these items by the fourth quarter of 2021.

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Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jul. 03, 2021

Accounting Policies [Abstract]

Basis of Presentation

Basis of PresentationThe accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") for interim financial information and with the instructions to Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and footnotes included in our Annual Report on Form 10-K for the year ended December 31, 2020.

Principles of consolidation

In the opinion of management, all adjustments (consisting of normal recurring accruals and other adjustments) considered necessary for a fair presentation of the unaudited Condensed Consolidated Financial Statements have been included and include our accounts and the accounts of all majority-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.On March 1, 2021, we announced a definitive agreement to sell our generic RX Pharmaceuticals business ("RX business") to Altaris Capital Partners, LLC ("Altaris"). On July 6, 2021, we completed the sale of the RX business. The financial results of our RX business, which were previously reported in our Prescription Pharmaceuticals ("RX") segment, have been classified as discontinued operations in the Condensed Consolidated Statements of Operations for all periods presented. The assets and liabilities of our RX business are reflected as assets and liabilities held for sale in the Condensed Consolidated Balance Sheets for all periods presented. Refer to Note 8 for additional information regarding discontinued operations. Unless otherwise noted, amounts and disclosures throughout the Notes to the unaudited Condensed Consolidated Financial Statements relate to our continuing operations.

Segment Reporting

Segment Reporting

Our reporting and operating segments are as follows:

•Consumer Self-Care Americas ("CSCA") comprises our consumer self-care business (OTC, infant formula, and oral self-care categories, and contract manufacturing) in the U.S., Mexico and Canada.

•Consumer Self-Care International ("CSCI") comprises our consumer self-care business primarily branded in Europe and Australia, our store brand business in the United Kingdom and parts of Europe and Asia, and our liquid licensed products business in the United Kingdom until it was disposed on June 19, 2020.

Allowance for Credit Losses

Allowance for Credit Losses

Expected credit losses on trade receivables and contract assets are measured collectively by geographic location. The estimate of expected credit losses considers historical credit loss information that is adjusted for current conditions and for reasonable and supportable forecasts. Historical credit loss experience provides the primary basis for estimation of expected credit losses. Adjustments to historical loss information may be made for

significant changes in a geographic location’s economic conditions. Receivables that do not share risk characteristics are evaluated on an individual basis. These receivables are not included in the collective evaluation.The allowance for credit losses is a valuation account that is deducted from the instruments’ cost basis to present the net amount expected to be collected. Trade receivables and contract assets are charged off against the allowance when the balance is no longer deemed collectible.

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Summary of Significant Accounting Policies (Tables)

6 Months Ended

Jul. 03, 2021

Accounting Policies [Abstract]

Allowance for Credit Losses

The following table presents the allowance for credit losses activity (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Beginning balance	$	9.1	$	6.2	$	6.5	$	6.0
Provision for credit losses, net	0.4		0.1		3.7		0.7
Receivables written-off	(0.6)		(0.9)		(0.9)		(1.1)
Recoveries collected	—		—		—		—
Transfer to held for sale	(1.4)		—		(1.4)		—
Currency translation adjustment	0.2		0.1		(0.2)		(0.1)
Ending balance	$	7.7	$	5.5	$	7.7	$	5.5

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Revenue Recognition (Tables)

6 Months Ended

Jul. 03, 2021

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

We generated net sales in the following geographic locations(1) (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
U.S.	$	590.3	$	604.0	$	1,201.6	$	1,274.6
Europe(2)	348.1		311.8		704.1		684.4
All other countries(3)	42.7		33.0		85.4		73.0
Total net sales	$	981.1	$	948.8	$	1,991.1	$	2,032.0

(1) Derived from the location of the entity that sells to a third party.

(2) Includes Ireland net sales of $5.3 million and $9.8 million for the three and six months ended July 3, 2021 respectively, and $7.8 million and $11.5 million for the three and six months ended June 27, 2020, respectively.

(3) Includes net sales generated primarily in Mexico, Australia and Canada.

Product Category

The following is a summary of our net sales by category (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
CSCA(1)
Upper respiratory	$	102.4	$	116.7	$	216.4	$	271.3
Digestive health	110.4		112.1		223.9		219.0
Nutrition	95.6		88.6		187.6		190.8
Pain and sleep-aids	87.1		97.7		179.5		218.1
Oral self-care	74.5		63.2		148.2		118.5
Healthy lifestyle	63.6		81.5		139.1		167.3
Skincare and personal hygiene	52.9		42.9		106.2		89.6
Vitamins, minerals, and supplements	8.4		6.4		16.2		12.8
Other CSCA(2)	27.4		18.6		45.7		40.8
Total CSCA	622.3		627.7		1,262.8		1,328.2
CSCI
Skincare and personal hygiene	112.4		97.6		219.4		192.3
Vitamins, minerals, and supplements	49.1		38.5		108.1		87.0
Healthy lifestyle	48.0		40.5		98.3		84.1
Pain and sleep-aids	47.3		40.2		96.3		87.0
Upper respiratory	42.6		45.5		85.5		129.6
Oral self-care	22.5		20.4		48.0		43.6
Digestive health	9.7		5.1		18.2		11.1
Other CSCI(3)	27.2		33.3		54.5		69.1
Total CSCI	358.8		321.1		728.3		703.8
Total net sales	$	981.1	$	948.8	$	1,991.1	$	2,032.0

(1) Includes net sales from our OTC contract manufacturing business.

(2) Consists primarily of diagnostic and other miscellaneous or otherwise uncategorized product lines and markets, none of which is greater than 10% of the segment net sales.

(3) Consists primarily of our distribution business and other miscellaneous or otherwise uncategorized product lines and markets, none of which is greater than 10% of the segment net sales.

Contract with Customer Balances

The following table provides information about contract assets from contracts with customers (in millions):

	Balance Sheet Location	July 3, 2021		December 31, 2020
Short-term contract assets	Prepaid expenses and other current assets	$	22.4	$	19.7

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Acquisitions and Divestitures (Tables)

6 Months Ended

Jul. 03, 2021

Business Combination and Asset Acquisition [Abstract]

Schedule of Assets Acquired and Liabilities Assumed

The following table summarizes the consideration paid for Dr. Fresh and the amounts of the assets acquired and liabilities assumed (in millions):

	Oral Care Assets of High Ridge Brands (Dr. Fresh)
Purchase price paid	$	106.2
Assets acquired:
Accounts receivable	13.1
Inventories	22.2
Prepaid expenses and other current assets	0.4
Property, plant and equipment, net	0.7
Operating lease assets	2.6
Goodwill	17.2
Distribution and license agreements and supply agreements	$	2.2
Developed product technology, formulations, and product rights	0.1
Customer relationships and distribution networks	20.6
Trademarks, trade names, and brands	43.2
Total intangible assets	$	66.1
Total assets	$	122.3
Liabilities assumed:
Accounts payable	$	6.1
Other accrued liabilities	3.8
Payroll and related taxes	0.7
Accrued customer programs	3.0
Other non-current liabilities	2.5
Total liabilities	$	16.1
Net assets acquired	$	106.2

Business Acquisition, Pro Forma Information

The following table presents unaudited pro forma information as if the acquisitions of Dr. Fresh and the Eastern European Brands occurred on January 1, 2019, and had been combined with the results reported in our Condensed Consolidated Statements of Operations for all periods presented (in millions):

	Three Months Ended		Six Months Ended
(Unaudited)	June 27, 2020		June 27, 2020
Net sales	$	955.0	$	2,074.1
Income from continuing operations	$	17.6	$	80.2

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Goodwill and Intangible Assets (Tables)

6 Months Ended

Jul. 03, 2021

Goodwill and Intangible Assets Disclosure [Abstract]

Schedule of Goodwill

Changes in the carrying amount of goodwill, by reportable segment, were as follows (in millions):

	December 31, 2020		Purchase accounting adjustments		Impairments		Currency translation adjustments		July 3, 2021
CSCA(1)	$	1,905.0	$	2.4	$	(6.1)	$	(0.1)	$	1,901.2
CSCI(2)	1,190.7		(2.4)		—		(32.7)		1,155.6
Total goodwill	$	3,095.7	$	—	$	(6.1)	$	(32.8)	$	3,056.8

(1) We had no accumulated goodwill impairments as of December 31, 2020 and $6.1 million as of July 3, 2021.

(2) We had accumulated goodwill impairments of $868.4 million as of December 31, 2020 and July 3, 2021.

Schedule of Finite and Indefinite-lived Intangible Assets

Intangible assets and related accumulated amortization consisted of the following (in millions):

	July 3, 2021				December 31, 2020
	Gross		Accumulated Amortization		Gross		Accumulated Amortization
Indefinite-lived intangibles:
Trademarks, trade names, and brands	$	3.6	$	—	$	4.3	$	—
In-process research and development	2.7		—		2.7		—
Total indefinite-lived intangibles	$	6.3	$	—	$	7.0	$	—
Definite-lived intangibles:
Distribution and license agreements and supply agreements	$	69.4	$	51.7	$	74.8	$	55.4
Developed product technology, formulations, and product rights	302.0		184.5		303.3		177.3
Customer relationships and distribution networks	1,877.9		863.7		1,920.5		823.7
Trademarks, trade names, and brands	1,534.0		369.6		1,581.5		342.2
Non-compete agreements	2.1		2.1		2.9		2.9
Total definite-lived intangibles	$	3,785.4	$	1,471.6	$	3,883.0	$	1,401.5
Total intangible assets	$	3,791.7	$	1,471.6	$	3,890.0	$	1,401.5

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Inventories (Tables)

6 Months Ended

Jul. 03, 2021

Inventory Disclosure [Abstract]

Major Components of Inventory

Major components of inventory were as follows (in millions):

 

	July 3, 2021		December 31, 2020
Finished goods	$	607.5	$	574.1
Work in process	241.0		220.4
Raw materials	267.4		264.9
Total inventories	$	1,115.9	$	1,059.4

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Fair Value Measurements (Tables)

6 Months Ended

Jul. 03, 2021

Fair Value Disclosures [Abstract]

Fair Value, Assets Measured on Recurring and Nonrecurring Basis

The table below summarizes the valuation of our financial instruments carried at fair value by the applicable pricing categories (in millions):

	July 3, 2021						December 31, 2020
	Level 1		Level 2		Level 3		Level 1		Level 2		Level 3
Measured at fair value on a recurring basis:
Assets:
Investment securities	$	1.6	$	—	$	—	$	2.5	$	—	$	—
Foreign currency forward contracts	—		5.7		—		—		9.8		—
Cross-currency swap	—		4.2		—		—		6.3		—
Total assets	$	1.6	$	9.9	$	—	$	2.5	$	16.1	$	—
Liabilities:
Foreign currency forward contracts	$	—	$	2.7	$	—	$	—	$	7.9	$	—
Total liabilities	$	—	$	2.7	$	—	$	—	$	7.9	$	—
Measured at fair value on a non-recurring basis:
Assets:
Assets held for sale, net(1)	$	—	$	—	$	1,621.0	$	—	$	—	$	—
Total assets	$	—	$	—	$	1,621.0	$	—	$	—	$	—

(1)     We measured the assets held for sale for impairment purposes and recorded a total impairment of $158.6 million (refer to Note 9).

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

The table below summarizes the change in fair value of the Royalty Pharma contingent milestone (in millions):

	Three Months Ended		Six Months Ended
	June 27, 2020		June 27, 2020
Beginning balance	$	96.9	$	95.3
Change in fair value	2.1		3.7
Ending balance	$	99.0	$	99.0

Schedule of Fair Value Assumptions

The table below represents the volatility and rate of return:

	Three Months Ended
	June 27, 2020
Volatility	37.5	%
Rate of return	6.91	%

Schedule of Carrying Values and Estimated Fair Values of Debt Instruments

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

	July 3, 2021				December 31, 2020
	Level 1		Level 2		Level 1		Level 2
Public Bonds
Carrying Value (excluding discount)	$	2,760.0	$	—	$	2,760.0	$	—
Fair value	$	2,946.3	$	—	$	3,031.1	$	—
Private placement note
Carrying value (excluding premium)	$	—	$	160.2	$	—	$	164.9
Fair value	$	—	$	172.0	$	—	$	177.5

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Investments (Tables)

6 Months Ended

Jul. 03, 2021

Investments [Abstract]

Equity Securities

The following table summarizes the measurement category, balance sheet location, and balances of our equity securities (in millions):

Measurement Category	Balance Sheet Location	July 3, 2021		December 31, 2020
Fair value method	Prepaid expenses and other current assets	$	1.6	$	2.5
Fair value method(1)	Other non-current assets	$	1.7	$	1.9
Equity method	Other non-current assets	$	69.1	$	69.8

(1)     Measured at fair value using the Net Asset Value practical expedient.

Equity Security Expense (Income)

The following table summarizes the expense (income) recognized in earnings of our equity securities (in millions):

		Three Months Ended				Six Months Ended
Measurement Category	Income Statement Location	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Fair value method	Other (income) expense, net	$	0.9	$	(0.4)	$	0.9	$	2.5
Equity method	Other (income) expense, net	$	—	$	(0.8)	$	0.7	$	(1.5)

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Discontinued Operations (Tables)

6 Months Ended

Jul. 03, 2021

Discontinued Operations, Disposed of by Sale | RX

Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]

Discontined Operations - Financial Statement Information

Income from discontinued operations, net of tax was as follows (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Net sales	$	204.5	$	270.4	$	404.5	$	528.1
Cost of sales	119.9		180.6		258.2		346.4
Gross profit	84.6		89.8		146.3		181.7
Operating expenses
Distribution	2.8		3.8		6.1		7.8
Research and development	17.3		16.4		30.6		30.1
Selling	8.8		7.4		16.2		14.7
Administration	12.4		8.1		30.6		14.5
Restructuring	—		0.4		—		0.4
Other operating expense (income)	0.5		(0.9)		(0.4)		0.2
Total operating expenses	41.8		35.2		83.1		67.7
Operating income (loss)	$	42.8	$	54.6	63.2		114.0
Interest expense, net	0.2		1.1		0.8		2.5
Other (income) expense, net	(0.2)		(2.9)		(1.7)		(2.1)
Income before income taxes	42.8		56.4		64.1		113.6
Income tax expense (benefit)	(11.4)		8.2		(25.4)		16.7
Income from discontinued operations, net of tax	$	54.2	$	48.2	$	89.5	$	96.9

During the three and six months ended July 3, 2021, we incurred $2.4 million and $11.7 million, respectively, of separation costs related to the sale of the RX business, which are recorded in administration expenses.

Select cash flow information related to discontinued operations was as follows (in millions):

	Six Months Ended
	July 3, 2021		June 27, 2020
Cash flows from discontinued operations operating activities:
Depreciation and amortization	$	15.3	$	48.2
Cash flows from discontinued operations investing activities:
Asset acquisitions	$	(69.7)	$	(0.1)
Additions to property, plant and equipment	$	(6.1)	$	(5.6)

The assets and liabilities classified as held for sale related to discontinued operations were as follows (in millions):

	July 3, 2021		December 31, 2020
Cash and cash equivalents	$	9.3	$	10.0
Accounts receivable, net of allowance for credit losses of $1.0 and $1.1, respectively	496.4		460.7
Inventories	143.4		140.8
Prepaid expenses and other current assets	21.4		55.4
Current assets held for sale*			666.9
Property, plant and equipment, net	133.3		131.4
Operating lease assets	30.0		31.3
Goodwill and indefinite-lived intangible assets	680.0		681.2
Definite-lived intangible assets, net	532.9		492.8
Deferred income taxes	4.2		3.6
Other non-current assets	22.6		23.7
Non-current assets held for sale*			1,364.0
Total assets held for sale	$	2,073.5	$	2,030.9
Accounts payable	$	91.6	$	92.2
Payroll and related taxes	14.1		22.3
Accrued customer programs	235.6		237.4
Other accrued liabilities	27.4		67.2
Accrued income taxes	0.1		—
Current indebtedness	0.5		0.5
Current liabilities held for sale*			419.6
Long-term debt, less current portion	0.4		0.7
Deferred income taxes	3.2		3.1
Other non-current liabilities	64.6		104.5
Non-current liabilities held for sale*			108.3
Total liabilities held for sale	$	437.5	$	527.9

*The non-current assets and liabilities of the RX business have been reclassified to current assets and liabilities held for sale, respectively, and the sale was completed on July 6, 2021

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Derivative Instruments and Hedging Activities (Tables)

6 Months Ended

Jul. 03, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Foreign Currency Forward Contracts

Foreign currency forward contracts were as follows (in millions):

	Notional Amount
	July 3, 2021		December 31, 2020
European Euro (EUR)	$	209.3	$	312.6
British Pound (GBP)	104.4		92.3
Israeli Shekel (ILS)	71.6		94.4
Danish Krone (DKK)	44.7		65.2
Swedish Krona (SEK)	42.2		41.2
Chinese Yuan (CNY)	41.5		49.1
United States Dollar (USD)	26.3		101.5
Canadian Dollar (CAD)	23.3		36.8
Polish Zloty (PLZ)	22.2		21.8
Norwegian Krone (NOK)	10.5		7.8
Romanian New Leu (RON)	5.7		3.6
Switzerland Franc (CHF)	5.1		8.2
Australian Dollar (AUD)	5.0		11.3
Turkish Lira (TRY)	4.3		4.0
Mexican Peso (MPX)	1.0		15.6
Other	2.6		2.3
Total	$	619.7	$	867.7

Schedule of Derivative Instruments in Statement of Financial Position, Fair Value

The balance sheet location and gross fair value of our outstanding derivative instruments were as follows (in millions):

		Asset Derivatives
		Fair Value
	Balance Sheet Location	July 3, 2021		December 31, 2020
Designated derivatives:
Foreign currency forward contracts	Prepaid expenses and other current assets	$	5.1	$	5.0
Foreign currency forward contracts	Other non-current assets	0.3		0.5
Cross-currency swap	Other non-current assets	4.2		6.3
Total designated derivatives		$	9.6	$	11.8
Non-designated derivatives:
Foreign currency forward contracts	Prepaid expenses and other current assets	$	0.3	$	4.3

		Liability Derivatives
		Fair Value
	Balance Sheet Location	July 3, 2021		December 31, 2020
Designated derivatives:
Foreign currency forward contracts	Other accrued liabilities	$	0.9	$	5.5
Non-designated derivatives:
Foreign currency forward contracts	Other accrued liabilities	$	1.8	$	2.4

Schedule of Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss)

The following tables summarize the effect of derivative instruments designated as hedging instruments in Accumulated Other Comprehensive Income ("AOCI") (in millions):

	Three Months Ended
	July 3, 2021
Instrument	Amount of Gain/(Loss) Recorded in OCI		Classification of Gain/(Loss) Reclassified from AOCI into Earnings	Amount of Gain/(Loss) Reclassified from AOCI into Earnings		Classification of Gain/(Loss) Recognized into Earnings Related to Amounts Excluded from Effectiveness Testing	Amount of Gain/(Loss) Recognized in Earnings on Derivatives Related to Amounts Excluded from Effectiveness Testing
Cash flow hedges:
Interest rate swap agreements	$	—	Interest expense, net	$	(0.4)	Interest expense, net	$	—
Foreign currency forward contracts	1.1		Net sales	(1.0)		Net sales	—
			Cost of sales	0.9		Cost of sales	0.4
						Other (income) expense, net	0.4
	$	1.1		$	(0.5)		$	0.8
Net investment hedges:
Cross-currency swap	$	(1.5)				Interest expense, net	$	(1.1)

	Six Months Ended
	July 3, 2021
Instrument	Amount of Gain/(Loss) Recorded in OCI(1)		Classification of Gain/(Loss) Reclassified from AOCI into Earnings	Amount of Gain/(Loss) Reclassified from AOCI into Earnings		Classification of Gain/(Loss) Recognized into Earnings Related to Amounts Excluded from Effectiveness Testing	Amount of Gain/(Loss) Recognized in Earnings on Derivatives Related to Amounts Excluded from Effectiveness Testing
Cash flow hedges:
Interest rate swap agreements	—		Interest expense, net	(0.9)		Interest expense, net	—
Foreign currency forward contracts	(1.2)		Net sales	(1.9)		Net sales	—
			Cost of sales	2.8		Cost of sales	0.5
						Other (income) expense, net	0.4
	$	(1.2)		$	—		$	0.9
Net investment hedges:
Cross-currency swap	$	(2.0)				Interest expense, net	$	(2.2)

(1) Net loss of $8.9 million is expected to be reclassified out of AOCI into earnings during the next 12 months.

	Three Months Ended
	June 27, 2020
Instrument	Amount of Gain/(Loss) Recorded in OCI		Classification of Gain/(Loss) Reclassified from AOCI into Earnings	Amount of Gain/(Loss) Reclassified from AOCI into Earnings		Classification of Gain/(Loss) Recognized into Earnings Related to Amounts Excluded from Effectiveness Testing	Amount of Gain/(Loss) Recognized in Earnings on Derivatives Related to Amounts Excluded from Effectiveness Testing
Cash flow hedges:
Interest rate swap agreements	$	—	Interest expense, net	$	(0.5)	Interest expense, net	$	—
Foreign currency forward contracts	0.5		Net sales	0.3		Net sales	—
			Cost of sales	0.1		Cost of sales	0.3
	$	0.5		$	(0.1)		$	0.3
Net investment hedges:
Cross-currency swap	$	(3.3)				Interest expense, net	$	1.8

	Six Months Ended
	June 27, 2020
Instrument	Amount of Gain/(Loss) Recorded in OCI		Classification of Gain/(Loss) Reclassified from AOCI into Earnings	Amount of Gain/(Loss) Reclassified from AOCI into Earnings		Classification of Gain/(Loss) Recognized into Earnings Related to Amounts Excluded from Effectiveness Testing	Amount of Gain/(Loss) Recognized in Earnings on Derivatives Related to Amounts Excluded from Effectiveness Testing
Cash flow hedges:
Interest rate swap agreements	$	—	Interest expense, net	$	(0.9)	Interest expense, net	$	—
Foreign currency forward contracts	9.8		Net sales	(0.1)		Net sales	—
			Cost of sales	(1.0)		Cost of sales	0.7
	$	9.8		$	(2.0)		$	0.7
Net investment hedges:
Cross-currency swap	$	(18.3)				Interest expense, net	$	4.6

Amount of Gain/(Loss) Recognized against Earnings

The amounts of (income)/expense recognized in earnings related to our non-designated derivatives on the Condensed Consolidated Statements of Operations were as follows (in millions):

		Three Months Ended				Six Months Ended
Non-Designated Derivatives	Income Statement Location	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Foreign currency forward contracts	Other (income) expense, net	$	(3.1)	$	(7.0)	$	(5.9)	$	(0.2)
	Interest expense, net	0.4		1.1		0.9		1.4
		$	(2.7)	$	(5.9)	$	(5.0)	$	1.2

Classification of Gain (Loss) Recognized in Earnings on Fair Value and Cash Flow Hedging Relationships

The classification and amount of gain/(loss) recognized in earnings on fair value and hedging relationships were as follows (in millions):

	Three Months Ended
	July 3, 2021
	Net Sales		Cost of Sales		Interest Expense, net		Other (Income) Expense, net
Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded	$	981.1	$	632.1	$	31.6	$	(0.4)
The effects of cash flow hedging:
Gain (loss) on cash flow hedging relationships
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	$	(1.0)	$	0.9	$	—	$	—
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	$	—	$	0.4	$	—	$	0.4
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	$	—	$	—	$	(0.4)	$	—

	Six Months Ended
	July 3, 2021
	Net Sales		Cost of Sales		Interest Expense, net		Other (Income) Expense, net
Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded	$	1,991.1	$	1,273.7	$	63.6	$	1.9
The effects of cash flow hedging:
Gain (loss) on cash flow hedging relationships
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	$	(1.9)	$	2.8	$	—	$	—
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	$	—	$	0.5	$	—	$	0.4
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	$	—	$	—	$	(0.9)	$	—

	Three Months Ended
	June 27, 2020
	Net Sales		Cost of Sales		Interest Expense, net		Other (Income) Expense, net
Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded	$	948.8	$	601.6	$	32.2	$	17.1
The effects of cash flow hedging:
Gain (loss) on cash flow hedging relationships
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	$	0.3	$	0.1	$	—	$	—
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	$	—	$	0.3	$	—	$	—
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	$	—	$	—	$	(0.5)	$	—

	Six Months Ended
	June 27, 2020
	Net Sales		Cost of Sales		Interest Expense, net		Other (Income) Expense, net
Total amounts of income and expense line items presented on the Condensed Consolidated Statements of Operations in which the effects of fair value or cash flow hedges are recorded	$	2,032.0	$	1,291.1	$	61.1	$	18.8
The effects of cash flow hedging:
Gain (loss) on cash flow hedging relationships
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	$	(0.1)	$	(1.0)	$	—	$	—
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	$	—	$	0.7	$	—	$	—
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	$	—	$	—	$	(0.9)	$	—

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Leases (Tables)

6 Months Ended

Jul. 03, 2021

Leases [Abstract]

Balance Sheet Location of Lease Assets and Liabilities

The balance sheet locations of our lease assets and liabilities were as follows (in millions):

Assets	Balance Sheet Location	July 3, 2021		December 31, 2020
Operating	Operating lease assets	$	171.3	$	154.7
Finance	Other non-current assets	31.0		29.8
Total		$	202.3	$	184.5

Liabilities	Balance Sheet Location	July 3, 2021		December 31, 2020
Current
Operating	Other accrued liabilities	$	27.9	$	28.3
Finance	Current indebtedness	5.2		6.7
Non-Current
Operating	Other non-current liabilities	149.6		132.5
Finance	Long-term debt, less current portion	23.3		20.2
Total		$	206.0	$	187.7

The below table shows our lease assets and liabilities by reporting segment (in millions):

	Assets
	Operating				Financing
	July 3, 2021		December 31, 2020		July 3, 2021		December 31, 2020
CSCA	$	98.1	$	75.9	$	16.1	$	16.7
CSCI	32.3		34.4		8.6		5.9
Unallocated	40.9		44.4		6.3		7.2
Total	$	171.3	$	154.7	$	31.0	$	29.8

	Liabilities
	Operating				Financing
	July 3, 2021		December 31, 2020		July 3, 2021		December 31, 2020
CSCA	$	98.2	$	75.8	$	16.6	$	17.0
CSCI	33.7		35.2		5.4		2.5
Unallocated	45.6		49.8		6.5		7.4
Total	$	177.5	$	160.8	$	28.5	$	26.9

Lease Expense

Lease expense was as follows (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Operating leases(1)	$	9.8	$	8.5	$	19.7	$	18.1
Finance leases
Amortization	$	1.5	$	1.0	$	3.0	$	2.0
Interest	0.2		0.2		0.4		0.4
Total finance leases	$	1.7	$	1.2	$	3.4	$	2.4

            (1) Includes short-term leases and variable lease costs, which are immaterial.

Finance Lease Maturity

The annual future maturities of our leases as of July 3, 2021 are as follows (in millions):

	Operating Leases		Finance Leases		Total
2021	$	16.5	$	3.0	$	19.5
2022	28.0		5.5		33.5
2023	20.7		3.9		24.6
2024	17.6		2.4		20.0
2025	15.7		2.2		17.9
After 2025	106.9		15.9		122.8
Total lease payments	205.4		32.9		238.3
Less: Interest	27.9		4.4		32.3
Present value of lease liabilities	$	177.5	$	28.5	$	206.0

Operating Lease Liability Maturity

The annual future maturities of our leases as of July 3, 2021 are as follows (in millions):

	Operating Leases		Finance Leases		Total
2021	$	16.5	$	3.0	$	19.5
2022	28.0		5.5		33.5
2023	20.7		3.9		24.6
2024	17.6		2.4		20.0
2025	15.7		2.2		17.9
After 2025	106.9		15.9		122.8
Total lease payments	205.4		32.9		238.3
Less: Interest	27.9		4.4		32.3
Present value of lease liabilities	$	177.5	$	28.5	$	206.0

Weighted Average Lease Terms and Discount Rates

Our weighted average lease terms and discount rates are as follows:

	July 3, 2021		June 27, 2020
Weighted-average remaining lease term (in years)
Operating leases	11.59		6.31
Finance leases	9.24		9.89
Weighted-average discount rate
Operating leases	2.71	%	3.73	%
Finance leases	2.76	%	3.39	%

Lease Cash Flow Classifications

Our lease cash flow classifications are as follows (in millions):

	Six Months Ended
	July 3, 2021		June 27, 2020
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows for operating leases	$	18.2	$	17.3
Operating cash flows for finance leases	$	0.4	$	0.4
Financing cash flows for finance leases	$	2.6	$	1.9
Leased assets obtained in exchange for new finance lease liabilities	$	4.4	$	2.2
Leased assets obtained in exchange for new operating lease liabilities	$	34.9	$	22.3

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Indebtedness (Tables)

6 Months Ended

Jul. 03, 2021

Debt Disclosure [Abstract]

Schedule of Debt

Total borrowings outstanding are summarized as follows (in millions):

			July 3, 2021		December 31, 2020
Term loan
	2019 Term loan due August 15, 2022		$	600.0	$	600.0
Notes and Bonds
	Coupon	Due
	5.105%	July 28, 2023(1)	160.2		164.9
	4.000%	November 15, 2023	215.6		215.6
	3.900%	December 15, 2024	700.0		700.0
	4.375%	March 15, 2026	700.0		700.0
	3.150%	June 15, 2030	750.0		750.0
	5.300%	November 15, 2043	90.5		90.5
	4.900%	December 15, 2044	303.9		303.9
	Total notes and bonds		2,920.2		2,924.9
Other financing			53.4		57.4
Unamortized premium (discount), net			(2.1)		(0.3)
Deferred financing fees			(15.6)		(17.1)
Total borrowings outstanding			3,555.9		3,564.9
	Current indebtedness		(630.1)		(37.3)
Total long-term debt less current portion			$	2,925.8	$	3,527.6

    (1) Debt denominated in euros subject to fluctuations in the euro-to-U.S. dollar exchange rate.

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Earnings Per Share and Shareholders' Equity (Tables)

6 Months Ended

Jul. 03, 2021

Earnings Per Share [Abstract]

Schedule of Earnings per Share, Basic and Diluted

A reconciliation of the numerators and denominators used in the basic and diluted earnings per share ("EPS") calculation is as follows (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Numerator:
Income (loss) from continuing operations	$	(111.9)	$	12.4	$	(109.1)	$	70.1
Income from discontinued operations, net of tax	54.2		48.2		89.5		96.9
Net income (loss)	$	(57.7)	$	60.6	$	(19.6)	$	167.0
Denominator:
Weighted average shares outstanding for basic EPS	133.6		136.4		133.4		136.3
Dilutive effect of share-based awards*	—		1.1		—		1.0
Weighted average shares outstanding for diluted EPS	133.6		137.5		133.4		137.3
Anti-dilutive share-based awards excluded from computation of diluted EPS	—		1.5		—		1.5
* In the period of a net loss, diluted shares equal basic shares.

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Accumulated Other Comprehensive Income (Loss) (Tables)

6 Months Ended

Jul. 03, 2021

Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract]

Schedule of Accumulated Other Comprehensive Income (Loss)

Changes in our AOCI balances, net of tax were as follows (in millions):

	Fair Value of Derivative Financial Instruments, net of tax		Foreign Currency Translation Adjustments		Post-Retirement and Pension Liability Adjustments, net of tax		Total AOCI
Balance at December 31, 2020	$	(0.7)	$	407.3	$	(11.6)	$	395.0
OCI before reclassifications	(7.3)		(79.1)		(1.5)		(87.9)
Amounts reclassified from AOCI	—		—		—		—
Other comprehensive income (loss)	$	(7.3)	$	(79.1)	$	(1.5)	$	(87.9)
Balance at July 3, 2021	$	(8.0)	$	328.2	$	(13.1)	$	307.1

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Income Taxes (Tables)

6 Months Ended

Jul. 03, 2021

Income Tax Disclosure [Abstract]

Schedule of effective income tax rate reconciliation

The effective tax rates were as follows:

Three Months Ended				Six Months Ended
July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
28.8	%	19.7	%	22.1	%	3.9	%

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Restructuring Charges (Tables)

6 Months Ended

Jul. 03, 2021

Restructuring Charges [Abstract]

Restructuring and Related Costs

The following reflects our restructuring activity (in millions):

	Three Months Ended				Six Months Ended
	July 3, 2021		June 27, 2020		July 3, 2021		June 27, 2020
Beginning balance	$	6.2	$	16.0	$	9.1	$	19.5
Additional charges	9.0		0.7		10.7		0.7
Payments	(5.1)		(7.3)		(9.5)		(10.8)
Non-cash adjustments	0.1		—		(0.1)		—
Ending balance	$	10.2	$	9.4	$	10.2	$	9.4

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Segment Information (Tables)

6 Months Ended

Jul. 03, 2021

Segment Reporting [Abstract]

Schedule of Segment Reporting Information, by Segment

The tables below show select financial measures by reporting segment (in millions):

	Total Assets
	July 3, 2021		December 31, 2020
CSCA	$	4,417.1	$	4,585.1
CSCI	4,723.9		4,872.4
Held for sale	2,089.3		2,030.9
Total	$	11,230.3	$	11,488.4

	Three Months Ended
	July 3, 2021						June 27, 2020
	Net Sales		Operating Income (Loss)		Intangible Asset Amortization		Net Sales		Operating Income (Loss)		Intangible Asset Amortization
CSCA	$	622.3	$	(72.0)	$	12.9	$	627.7	$	104.6	$	13.2
CSCI	358.8		1.3		40.5		321.1		10.5		38.4
Unallocated	—		(55.2)		—		—		(52.4)		—
Continuing Operations Total	$	981.1	$	(125.9)	$	53.4	$	948.8	$	62.7	$	51.6

	Six Months Ended
	July 3, 2021						June 27, 2020
	Net Sales		Operating Income (Loss)		Intangible Asset Amortization		Net Sales		Operating Income (Loss)		Intangible Asset Amortization
CSCA	$	1,262.8	$	23.6	$	25.8	$	1,328.2	$	226.7	$	27.5
CSCI	728.3		18.8		80.8		703.8		35.6		76.7
Unallocated	—		(117.0)		—		—		(113.2)		—
Continuing Operations Total	$	1,991.1	$	(74.6)	$	106.6	$	2,032.0	$	149.1	$	104.2

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Summary of Significant Accounting Policies - Allowance for Credit Losses (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Accounts Receivable, Allowance for Credit Loss [Roll Forward]
Beginning balance	$ 9.1	$ 6.2	$ 6.5	$ 6.0
Provision for credit losses, net	0.4	0.1	3.7	0.7
Receivables written-off	(0.6)	(0.9)	(0.9)	(1.1)
Recoveries collected	0.0	0.0	0.0	0.0
Transfer to held for sale	(1.4)	0.0	(1.4)	0.0
Currency translation adjustment	0.2	0.1	(0.2)	(0.1)
Ending balance	$ 7.7	$ 5.5	$ 7.7	$ 5.5

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Revenue Recognition - Schedule of Revenue by Geographic Location (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Disaggregation of Revenue [Line Items]
Net sales	$ 981.1	$ 948.8	$ 1,991.1	$ 2,032.0
U.S.
Disaggregation of Revenue [Line Items]
Net sales	590.3	604.0	1,201.6	1,274.6
Europe
Disaggregation of Revenue [Line Items]
Net sales	348.1	311.8	704.1	684.4
All other countries
Disaggregation of Revenue [Line Items]
Net sales	42.7	33.0	85.4	73.0
Ireland
Disaggregation of Revenue [Line Items]
Net sales	$ 5.3	$ 7.8	$ 9.8	$ 11.5

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Revenue Recognition - Schedule of Revenue by Product (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Disaggregation of Revenue [Line Items]
Net sales	$ 981.1	$ 948.8	$ 1,991.1	$ 2,032.0
CSCA
Disaggregation of Revenue [Line Items]
Net sales	622.3	627.7	1,262.8	1,328.2
CSCA | Upper respiratory
Disaggregation of Revenue [Line Items]
Net sales	102.4	116.7	216.4	271.3
CSCA | Digestive health
Disaggregation of Revenue [Line Items]
Net sales	110.4	112.1	223.9	219.0
CSCA | Nutrition
Disaggregation of Revenue [Line Items]
Net sales	95.6	88.6	187.6	190.8
CSCA | Pain and sleep-aids
Disaggregation of Revenue [Line Items]
Net sales	87.1	97.7	179.5	218.1
CSCA | Oral self-care
Disaggregation of Revenue [Line Items]
Net sales	74.5	63.2	148.2	118.5
CSCA | Healthy lifestyle
Disaggregation of Revenue [Line Items]
Net sales	63.6	81.5	139.1	167.3
CSCA | Skincare and personal hygiene
Disaggregation of Revenue [Line Items]
Net sales	52.9	42.9	106.2	89.6
CSCA | Vitamins, minerals, and supplements
Disaggregation of Revenue [Line Items]
Net sales	8.4	6.4	16.2	12.8
CSCA | Other CSCA
Disaggregation of Revenue [Line Items]
Net sales	27.4	18.6	45.7	40.8
CSCI
Disaggregation of Revenue [Line Items]
Net sales	358.8	321.1	728.3	703.8
CSCI | Upper respiratory
Disaggregation of Revenue [Line Items]
Net sales	42.6	45.5	85.5	129.6
CSCI | Digestive health
Disaggregation of Revenue [Line Items]
Net sales	9.7	5.1	18.2	11.1
CSCI | Pain and sleep-aids
Disaggregation of Revenue [Line Items]
Net sales	47.3	40.2	96.3	87.0
CSCI | Oral self-care
Disaggregation of Revenue [Line Items]
Net sales	22.5	20.4	48.0	43.6
CSCI | Healthy lifestyle
Disaggregation of Revenue [Line Items]
Net sales	48.0	40.5	98.3	84.1
CSCI | Skincare and personal hygiene
Disaggregation of Revenue [Line Items]
Net sales	112.4	97.6	219.4	192.3
CSCI | Vitamins, minerals, and supplements
Disaggregation of Revenue [Line Items]
Net sales	49.1	38.5	108.1	87.0
CSCI | Other CSCI
Disaggregation of Revenue [Line Items]
Net sales	$ 27.2	$ 33.3	$ 54.5	$ 69.1

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Revenue Recognition - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Disaggregation of Revenue [Line Items]
Net sales	$ 981.1	$ 948.8	$ 1,991.1	$ 2,032.0
Contract manufacturing
Disaggregation of Revenue [Line Items]
Net sales	$ 69.8	$ 64.5	$ 132.9	$ 113.7

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Revenue Recognition - Schedule of Contract Balances (Details) - USD ($) $ in Millions	Jul. 03, 2021	Dec. 31, 2020
Revenue from Contract with Customer [Abstract]
Short-term contract assets	$ 22.4	$ 19.7

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Acquisitions and Divestitures - Acquisitions (Details) € in Millions, $ in Millions	Oct. 30, 2020 EUR (€) brand	Oct. 30, 2020 USD ($) brand	Feb. 13, 2020 USD ($)	Jan. 03, 2020 USD ($)
Sanofi Brands
Business Acquisition [Line Items]
Number of brands acquired | brand	3	3
Purchase price paid	€ 53.3	$ 62.3
Useful life of intangible assets	18 years 9 months 18 days	18 years 9 months 18 days
Steripod
Business Acquisition [Line Items]
Purchase price paid				$ 26.0
Brand | Sanofi Brands
Business Acquisition [Line Items]
Intangible assets acquired		$ 52.5
Brand | Dexsil
Business Acquisition [Line Items]
Intangible assets acquired			$ 8.0
Useful life of intangible assets			25 years
Brand | Steripod
Business Acquisition [Line Items]
Intangible assets acquired				$ 25.1
Useful life of intangible assets				25 years

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Acquisitions and Divestitures - Oral Care Assets of High Ridge Brands and Ranir Global Holdings,LLC Acquisitions (Details) - USD ($) $ in Millions	Dec. 31, 2020	Apr. 01, 2020	Jul. 03, 2021
Estimated fair value of assets acquired and liabilities assumed:
Goodwill	$ 3,095.7		$ 3,056.8
Oral Care Assets of High Ridge Brands (Dr. Fresh)
Business Acquisition [Line Items]
Purchase price paid	106.2	$ 113.0
Prepayment of contract consideration for transitional services	2.0
Estimated fair value of assets acquired and liabilities assumed:
Accounts receivable	13.1
Inventories	22.2
Prepaid expenses and other current assets	0.4
Property, plant and equipment, net	0.7
Operating lease assets	2.6
Goodwill	17.2
Total intangible assets	66.1
Total assets	122.3
Accounts payable	6.1
Other accrued liabilities	3.8
Payroll and related taxes	0.7
Accrued customer programs	3.0
Other non-current liabilities	2.5
Total liabilities	16.1
Net assets acquired	106.2
Useful life of intangible assets		17 years 9 months 18 days
Oral Care Assets of High Ridge Brands (Dr. Fresh) | Distribution and license agreements and supply agreements
Estimated fair value of assets acquired and liabilities assumed:
Total intangible assets	2.2
Oral Care Assets of High Ridge Brands (Dr. Fresh) | Developed product technology, formulations, and product rights
Estimated fair value of assets acquired and liabilities assumed:
Total intangible assets	0.1
Oral Care Assets of High Ridge Brands (Dr. Fresh) | Customer relationships and distribution networks
Estimated fair value of assets acquired and liabilities assumed:
Total intangible assets	20.6
Oral Care Assets of High Ridge Brands (Dr. Fresh) | Trademarks, trade names, and brands
Estimated fair value of assets acquired and liabilities assumed:
Total intangible assets	$ 43.2

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Acquisitions and Divestitures - Pro Forma Information (Details) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 27, 2020	Jun. 27, 2020
Business Combination and Asset Acquisition [Abstract]
Net sales	$ 955.0	$ 2,074.1
Income from continuing operations	$ 17.6	$ 80.2

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Acquisitions and Divestitures - Divestiture (Details) £ in Millions, $ in Millions			3 Months Ended			6 Months Ended
	Jun. 19, 2020 USD ($)	Jun. 19, 2020 GBP (£)	Dec. 31, 2020 USD ($)	Sep. 26, 2020 USD ($)	Jun. 27, 2020 USD ($)	Jul. 03, 2021 USD ($)	Jun. 27, 2020 USD ($)
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Net proceeds from sale of business						$ 0.0	$ 187.8
Loss on sale of business						$ 0.0	17.4
Rosemont Pharmaceuticals
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Net proceeds from sale of business	$ 195.0	£ 155.6
Loss on sale of business			$ 2.4	$ 1.3	$ 17.4		$ 17.4
Foreign currency translation adjustment	$ (46.4)

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Goodwill and Intangible Assets - Goodwill (Details) - USD ($) $ in Millions	6 Months Ended
	Jul. 03, 2021	Dec. 31, 2020
Goodwill [Roll Forward]
Goodwill, Beginning Balance	$ 3,095.7
Purchase accounting adjustments	0.0
Impairments	(6.1)
Currency translation adjustments	(32.8)
Goodwill, Ending Balance	3,056.8
CSCA
Goodwill [Roll Forward]
Goodwill, Beginning Balance	1,905.0
Purchase accounting adjustments	2.4
Impairments	(6.1)
Currency translation adjustments	(0.1)
Goodwill, Ending Balance	1,901.2
Accumulated impairments	6.1	$ 0.0
CSCI
Goodwill [Roll Forward]
Goodwill, Beginning Balance	1,190.7
Purchase accounting adjustments	(2.4)
Impairments	0.0
Currency translation adjustments	(32.7)
Goodwill, Ending Balance	1,155.6
Accumulated impairments	$ 868.4	$ 868.4

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Goodwill and Intangible Assets - Intangible categories (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020	Dec. 31, 2020
Finite And Indefinite Lived Assets By Major Class [Line Items]
Indefinite-lived intangibles:	$ 6.3		$ 6.3		$ 7.0
Gross	3,785.4		3,785.4		3,883.0
Accumulated Amortization	1,471.6		1,471.6		1,401.5
Total other intangible assets	3,791.7		3,791.7		3,890.0
Intangible assets amortization expense	53.4	$ 51.6	106.6	$ 104.2
Distribution and license agreements and supply agreements
Finite And Indefinite Lived Assets By Major Class [Line Items]
Gross	69.4		69.4		74.8
Accumulated Amortization	51.7		51.7		55.4
Developed product technology, formulations, and product rights
Finite And Indefinite Lived Assets By Major Class [Line Items]
Gross	302.0		302.0		303.3
Accumulated Amortization	184.5		184.5		177.3
Customer relationships and distribution networks
Finite And Indefinite Lived Assets By Major Class [Line Items]
Gross	1,877.9		1,877.9		1,920.5
Accumulated Amortization	863.7		863.7		823.7
Trademarks, trade names, and brands
Finite And Indefinite Lived Assets By Major Class [Line Items]
Gross	1,534.0		1,534.0		1,581.5
Accumulated Amortization	369.6		369.6		342.2
Non-compete agreements
Finite And Indefinite Lived Assets By Major Class [Line Items]
Gross	2.1		2.1		2.9
Accumulated Amortization	2.1		2.1		2.9
Trademarks, trade names, and brands
Finite And Indefinite Lived Assets By Major Class [Line Items]
Indefinite-lived intangibles:	3.6		3.6		4.3
In-process research and development
Finite And Indefinite Lived Assets By Major Class [Line Items]
Indefinite-lived intangibles:	$ 2.7		$ 2.7		$ 2.7

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Inventories (Details) - USD ($) $ in Millions	Jul. 03, 2021	Dec. 31, 2020
Inventory Disclosure [Abstract]
Finished goods	$ 607.5	$ 574.1
Work in process	241.0	220.4
Raw materials	267.4	264.9
Total inventories	$ 1,115.9	$ 1,059.4

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Fair Value Measurements - Financial Instruments at Fair Value (Details) - USD ($) $ in Millions	3 Months Ended
	Jul. 03, 2021	Dec. 31, 2020
Assets Held for Sale | Latin America Business
Liabilities:
Total impairment charge	$ 158.6
Measured at fair value on a recurring basis | Level 1
Assets:
Investment securities	1.6	$ 2.5
Foreign currency forward contracts	0.0	0.0
Cross-currency swap	0.0	0.0
Total assets	1.6	2.5
Liabilities:
Foreign currency forward contracts	0.0	0.0
Total liabilities	0.0	0.0
Measured at fair value on a recurring basis | Level 2
Assets:
Investment securities	0.0	0.0
Foreign currency forward contracts	5.7	9.8
Cross-currency swap	4.2	6.3
Total assets	9.9	16.1
Liabilities:
Foreign currency forward contracts	2.7	7.9
Total liabilities	2.7	7.9
Measured at fair value on a recurring basis | Level 3
Assets:
Investment securities	0.0	0.0
Foreign currency forward contracts	0.0	0.0
Cross-currency swap	0.0	0.0
Total assets	0.0	0.0
Liabilities:
Foreign currency forward contracts	0.0	0.0
Total liabilities	0.0	0.0
Measured at fair value on a non-recurring basis | Level 1
Assets:
Assets held-for-sale, net	0.0	0.0
Total assets	0.0	0.0
Measured at fair value on a non-recurring basis | Level 2
Assets:
Assets held-for-sale, net	0.0	0.0
Total assets	0.0	0.0
Measured at fair value on a non-recurring basis | Level 3
Assets:
Assets held-for-sale, net	1,621.0	0.0
Total assets	$ 1,621.0	$ 0.0

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Fair Value Measurements - Reconciliation of Level 3 Assets and Liabilities (Details) - Royalty Pharma Contingent Milestone Payments - Measured on a recurring basis - Level 3 - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 27, 2020	Jun. 27, 2020
Royalty Pharma Contingent Milestone Payments
Beginning balance	$ 96.9	$ 95.3
Change in fair value	2.1	3.7
Ending balance	$ 99.0	$ 99.0

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Fair Value Measurements - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended	6 Months Ended
	Jun. 27, 2020	Jun. 27, 2020	Dec. 31, 2020	Mar. 28, 2020	Dec. 31, 2019
Royalty Pharma Contingent Milestone Payments | Measured on a recurring basis | Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Increase (decrease) in fair value of milestone payment	$ 2.1	$ 3.7
Estimated fair valued contingent milestone payment	$ 99.0	$ 99.0	$ 0.0	$ 96.9	$ 95.3
Royalty Pharma
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Volatility	37.50%
Rate of return	6.91%

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Fair Value Measurements - Schedule of Fixed Rate Long-term Debt (Details) - USD ($) $ in Millions	Jul. 03, 2021	Dec. 31, 2020
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Public bonds	$ 2,920.2	$ 2,924.9
Public Bonds | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Public bonds	2,946.3	3,031.1
Private placement note | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Private placement note	172.0	177.5
Reported Value Measurement | Public Bonds | Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Public bonds	2,760.0	2,760.0
Reported Value Measurement | Private placement note | Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Private placement note	$ 160.2	$ 164.9

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Investments (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020	Dec. 31, 2020
Other (income) expense, net
Schedule of Equity Method Investments [Line Items]
Equity securities, fair value method, other expense (income)	$ 0.9	$ (0.4)	$ 0.9	$ 2.5
Equity securities, equity method, other expense (income)	0.0	$ (0.8)	0.7	$ (1.5)
Prepaid expenses and other current assets
Schedule of Equity Method Investments [Line Items]
Equity securities, fair value method	1.6		1.6		$ 2.5
Other non-current assets
Schedule of Equity Method Investments [Line Items]
Equity securities, fair value method	1.7		1.7		1.9
Equity securities, equity method, other non-current assets	$ 69.1		$ 69.1		$ 69.8

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Discontinued Operations (Details) - RX - Discontinued Operations, Disposed of by Sale - USD ($)		3 Months Ended	6 Months Ended
	Jul. 06, 2021	Jul. 03, 2021	Jul. 03, 2021
Discontinued Operations
Separation costs		$ 2,400,000	$ 11,700,000
Subsequent Event
Discontinued Operations
Total consideration	$ 1,550,000,000
Potential R&D milestone payments and contingent purchase obligations assumed by purchaser	$ 53,000,000.0
Transition service period	24 months
Supply agreement term	4 years
Supply agreement, extension period	7 years
Aggregate cap on buyer's obligation for certain pre-closing liabilities (percent)	50.00%
Aggregate cap on buyer's obligation for certain pre-closing liabilities	$ 50,000,000.0

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Discontinued Operations - Results of Discontinued Operations (Details) - Discontinued Operations, Disposed of by Sale - RX - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Net sales	$ 204.5	$ 270.4	$ 404.5	$ 528.1
Cost of sales	119.9	180.6	258.2	346.4
Gross profit	84.6	89.8	146.3	181.7
Distribution	2.8	3.8	6.1	7.8
Research and development	17.3	16.4	30.6	30.1
Selling	8.8	7.4	16.2	14.7
Administration	12.4	8.1	30.6	14.5
Restructuring	0.0	0.4	0.0	0.4
Other operating expense (income)	0.5	(0.9)	(0.4)	0.2
Total operating expenses	41.8	35.2	83.1	67.7
Operating income (loss)	42.8	54.6	63.2	114.0
Interest expense, net	0.2	1.1	0.8	2.5
Other (income) expense, net	(0.2)	(2.9)	(1.7)	(2.1)
Income before income taxes	42.8	56.4	64.1	113.6
Income tax expense (benefit)	(11.4)	8.2	(25.4)	16.7
Income from discontinued operations, net of tax	$ 54.2	$ 48.2	$ 89.5	$ 96.9

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Discontinued Operations - Cash Flow Information (Details) - Discontinued Operations, Disposed of by Sale - RX - USD ($) $ in Millions			6 Months Ended
	Mar. 08, 2021	Dec. 31, 2020	Jul. 03, 2021	Jun. 27, 2020
Cash flows from discontinued operations operating activities:
Depreciation and amortization			$ 15.3	$ 48.2
Cash flows from discontinued operations investing activities:
Asset acquisitions	$ (53.3)	$ (16.4)	(69.7)	(0.1)
Additions to property, plant and equipment			$ (6.1)	$ (5.6)

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Discontinued Operations - Additional Cash Flow Information (Details) $ in Millions				6 Months Ended
	Mar. 08, 2021 USD ($)	Dec. 31, 2020 USD ($)	May 15, 2015 brand	Jul. 03, 2021 USD ($)	Jun. 27, 2020 USD ($)
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Number of ANDAs acquired | brand			2
Discontinued Operations, Disposed of by Sale | RX
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Asset acquisitions | $	$ 53.3	$ 16.4		$ 69.7	$ 0.1

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Discontinued Operations - Assets and Liabilities (Details) - USD ($) $ in Millions	Jul. 03, 2021	Dec. 31, 2020	Jun. 27, 2020	Dec. 31, 2019
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Cash and cash equivalents	$ 18.5	$ 10.0	$ 18.7	$ 9.8
Current assets held for sale	2,089.3	666.9
Non-current assets held for sale	0.0	1,364.0
Current liabilities held for sale	468.3	419.6
Non-current liabilities held for sale	0.0	108.3
Discontinued Operations, Disposed of by Sale | RX
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Cash and cash equivalents	9.3	10.0
Accounts receivable, net of allowance for credit losses of $1.0 and $1.1, respectively	496.4	460.7
Inventories	143.4	140.8
Prepaid expenses and other current assets	21.4	55.4
Current assets held for sale		666.9
Property, plant and equipment, net	133.3	131.4
Operating lease assets	30.0	31.3
Goodwill and indefinite-lived intangible assets	680.0	681.2
Definite-lived intangible assets, net	532.9	492.8
Deferred income taxes	4.2	3.6
Other non-current assets	22.6	23.7
Non-current assets held for sale		1,364.0
Total assets held for sale	2,073.5	2,030.9
Accounts payable	91.6	92.2
Payroll and related taxes	14.1	22.3
Accrued customer programs	235.6	237.4
Other accrued liabilities	27.4	67.2
Current indebtedness	0.5	0.5
Current liabilities held for sale		419.6
Long-term debt, less current portion	0.4	0.7
Deferred income taxes	3.2	3.1
Other non-current liabilities	64.6	104.5
Non-current liabilities held for sale		108.3
Total liabilities held for sale	437.5	527.9
Allowance for credit losses	1.0	1.1
Accrued income taxes	$ 0.1	$ 0.0

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Discontinued Operations and Disposal Groups (Details) - USD ($) $ in Millions	3 Months Ended
	Jul. 03, 2021	Dec. 31, 2020
CSCA
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Accumulated impairments	$ 6.1	$ 0.0
Assets Held for Sale | Mexico and Brazil-based Over-the-counter Businesses
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Fair value impairment charge	152.5
Total impairment charge	158.6
Assets Held for Sale | Mexico and Brazil-based Over-the-counter Businesses | Current Assets Held for Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Assets held for sale	15.8
Assets Held for Sale | Mexico and Brazil-based Over-the-counter Businesses | Current Liabilities Held for Sale
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Liabilities held for sale	$ 30.8

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Derivative Instruments and Hedging Activities - Foreign Currency Forward Contracts (Details) € in Millions, $ in Millions	6 Months Ended
	Jul. 03, 2021 EUR (€)	Jul. 03, 2021 USD ($)	Dec. 31, 2020 USD ($)
Cross-currency swap
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives	€ 450.0	$ 498.0
Foreign currency forward contracts
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		619.7	$ 867.7
Maximum remaining maturity of foreign currency derivatives	60 months
Foreign currency forward contracts | European Euro (EUR)
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		209.3	312.6
Foreign currency forward contracts | British Pound (GBP)
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		104.4	92.3
Foreign currency forward contracts | Israeli Shekel (ILS)
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		71.6	94.4
Foreign currency forward contracts | Danish Krone (DKK)
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		44.7	65.2
Foreign currency forward contracts | Swedish Krona (SEK)
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		42.2	41.2
Foreign currency forward contracts | Chinese Yuan (CNY)
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		41.5	49.1
Foreign currency forward contracts | United States Dollar (USD)
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		26.3	101.5
Foreign currency forward contracts | Canadian Dollar (CAD)
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		23.3	36.8
Foreign currency forward contracts | Polish Zloty (PLZ)
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		22.2	21.8
Foreign currency forward contracts | Norwegian Krone (NOK)
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		10.5	7.8
Foreign currency forward contracts | Romanian New Leu (RON)
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		5.7	3.6
Foreign currency forward contracts | Switzerland Franc (CHF)
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		5.1	8.2
Foreign currency forward contracts | Australian Dollar (AUD)
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		5.0	11.3
Foreign currency forward contracts | Turkish Lira (TRY)
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		4.3	4.0
Foreign currency forward contracts | Mexican Peso (MPX)
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		1.0	15.6
Foreign currency forward contracts | Other
Foreign Currency Fair Value Hedge Derivative [Line Items]
Notional amount of derivatives		$ 2.6	$ 2.3

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Derivative Instruments and Hedging Activities - Balance Sheet Location (Details) - USD ($) $ in Millions	Jul. 03, 2021	Dec. 31, 2020
Designated derivatives:
Derivatives, Fair Value [Line Items]
Asset Derivatives	$ 9.6	$ 11.8
Designated derivatives: | Prepaid expenses and other current assets | Foreign currency forward contracts
Derivatives, Fair Value [Line Items]
Asset Derivatives	5.1	5.0
Designated derivatives: | Other non-current assets | Foreign currency forward contracts
Derivatives, Fair Value [Line Items]
Asset Derivatives	0.3	0.5
Designated derivatives: | Other non-current assets | Cross-currency swap
Derivatives, Fair Value [Line Items]
Asset Derivatives	4.2	6.3
Designated derivatives: | Other accrued liabilities | Foreign currency forward contracts
Derivatives, Fair Value [Line Items]
Liability Derivatives	0.9	5.5
Non-designated derivatives: | Prepaid expenses and other current assets | Foreign currency forward contracts
Derivatives, Fair Value [Line Items]
Asset Derivatives	0.3	4.3
Non-designated derivatives: | Other accrued liabilities | Foreign currency forward contracts
Derivatives, Fair Value [Line Items]
Liability Derivatives	$ 1.8	$ 2.4

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Derivative Instruments and Hedging Activities - Effect of Cash Flow Hedges Included in AOCI (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of Gain/(Loss) Recorded in OCI, Cash flow hedges	$ 1.1	$ 0.5	$ (1.2)	$ 9.8
Amount of Gain/(Loss) Reclassified from AOCI into Earnings	(0.5)	(0.1)	0.0	(2.0)
Gain (Loss) from Components Excluded from Assessment of Cash Flow Hedge Effectiveness, Net	0.8	0.3	0.9	0.7
Foreign Currency Cash Flow Hedge Loss to be Reclassified During Next 12 Months	8.9		8.9
Interest expense, net
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of gain or (loss) reclassified from AOCI into earnings - Foreign currency forward contracts	0.0	0.0	0.0	0.0
Gain (Loss) on Components Excluded from Assessment of Interest Rate Cash Flow Hedge Effectiveness	0.0	0.0	0.0	0.0
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	0.0	0.0	0.0	0.0
Net Sales
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of gain or (loss) reclassified from AOCI into earnings - Foreign currency forward contracts	(1.0)	0.3	(1.9)	(0.1)
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	0.0	0.0	0.0	0.0
Cost of sales
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of gain or (loss) reclassified from AOCI into earnings - Foreign currency forward contracts	0.9	0.1	2.8	(1.0)
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	0.4	0.3	0.5	0.7
Interest Rate Swap | Interest expense, net
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of Gain/(Loss) Recorded in OCI, Cash flow hedges	0.0	0.0	0.0	0.0
Amount of gain or (loss) reclassified from AOCI into earnings - Interest rate swap agreements	(0.4)	(0.5)	(0.9)	(0.9)
Interest Rate Swap | Net Sales
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of gain or (loss) reclassified from AOCI into earnings - Interest rate swap agreements	0.0	0.0	0.0	0.0
Interest Rate Swap | Cost of sales
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of gain or (loss) reclassified from AOCI into earnings - Interest rate swap agreements	0.0	0.0	0.0	0.0
Foreign currency forward contracts
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of Gain/(Loss) Recorded in OCI, Cash flow hedges	1.1	0.5	(1.2)	9.8
Cross-currency swap
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount of Gain/(Loss) Recorded in OCI, Net investment hedges	(1.5)	(3.3)	(2.0)	(18.3)
Cross-currency swap | Interest expense, net
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	$ (1.1)	$ 1.8	$ (2.2)	$ 4.6

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Derivative Instruments and Hedging Activities - Non-designated Derivatives (Details) - Non-designated derivatives: - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Derivative Instruments, Gain (Loss) [Line Items]
Amount of Gain/(Loss) Recognized against Earnings	$ (2.7)	$ (5.9)	$ (5.0)	$ 1.2
Foreign currency forward contracts | Other (income) expense, net
Derivative Instruments, Gain (Loss) [Line Items]
Amount of Gain/(Loss) Recognized against Earnings	(3.1)	(7.0)	(5.9)	(0.2)
Foreign currency forward contracts | Interest expense, net
Derivative Instruments, Gain (Loss) [Line Items]
Amount of Gain/(Loss) Recognized against Earnings	$ 0.4	$ 1.1	$ 0.9	$ 1.4

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Derivative Instruments and Hedging Activities - Classification of Gain (Loss) of Cash Flow And Fair Value Hedging Relationships (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Derivative Instruments, Gain (Loss) [Line Items]
Net sales	$ 981.1	$ 948.8	$ 1,991.1	$ 2,032.0
Cost of sales	632.1	601.6	1,273.7	1,291.1
Interest expense, net	31.6	32.2	63.6	61.1
Other (income) expense, net	(0.4)	17.1	1.9	18.8
Net Sales
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	(1.0)	0.3	(1.9)	(0.1)
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	0.0	0.0	0.0	0.0
Cost of sales
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	0.9	0.1	2.8	(1.0)
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	0.4	0.3	0.5	0.7
Interest expense, net
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	0.0	0.0	0.0	0.0
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	0.0	0.0	0.0	0.0
Other (income) expense, net
Foreign currency forward contracts
Amount of gain or (loss) reclassified from AOCI into earnings	0.0	0.0	0.0	0.0
Amount excluded from effectiveness testing recognized using a systematic and rational amortization approach	0.4	0.0	0.4	0.0
Interest Rate Swap | Net Sales
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	0.0	0.0	0.0	0.0
Interest Rate Swap | Cost of sales
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	0.0	0.0	0.0	0.0
Interest Rate Swap | Interest expense, net
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	(0.4)	(0.5)	(0.9)	(0.9)
Interest Rate Swap | Other (income) expense, net
Interest rate swap agreements
Amount of gain or (loss) reclassified from AOCI into earnings	$ 0.0	$ 0.0	$ 0.0	$ 0.0

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Leases - Balance Sheet Location of Assets and Liabilities (Details) - USD ($) $ in Millions	Jul. 03, 2021	Dec. 31, 2020
Lessee, Lease, Description [Line Items]
Operating lease assets	$ 171.3	$ 154.7
Finance leases	31.0	29.8
Right-of-Use Asset	202.3	184.5
Operating lease liability, current	27.9	28.3
Finance lease liability, current	5.2	6.7
Operating lease liability, noncurrent	149.6	132.5
Finance lease liability, noncurrent	23.3	20.2
Present value of lease liabilities	206.0	187.7
Total operating lease liabilities	177.5	160.8
Total finance lease liabilities	$ 28.5	$ 26.9
Finance Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List]	us-gaap:OtherAssets	us-gaap:OtherAssets
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List]	us-gaap:OtherLiabilitiesCurrent	us-gaap:OtherLiabilitiesCurrent
Finance Lease, Liability, Current, Statement of Financial Position [Extensible List]	us-gaap:DebtCurrent	us-gaap:DebtCurrent
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	Other non-current liabilities	Other non-current liabilities
Finance Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List]	Long-term debt, less current portion	Long-term debt, less current portion
Unallocated
Lessee, Lease, Description [Line Items]
Operating lease assets	$ 40.9	$ 44.4
Finance leases	6.3	7.2
Total operating lease liabilities	45.6	49.8
Total finance lease liabilities	6.5	7.4
CSCA | Operating Segments
Lessee, Lease, Description [Line Items]
Operating lease assets	98.1	75.9
Finance leases	16.1	16.7
Total operating lease liabilities	98.2	75.8
Total finance lease liabilities	16.6	17.0
CSCI | Operating Segments
Lessee, Lease, Description [Line Items]
Operating lease assets	32.3	34.4
Finance leases	8.6	5.9
Total operating lease liabilities	33.7	35.2
Total finance lease liabilities	$ 5.4	$ 2.5

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Leases - Lease Expense (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Leases [Abstract]
Operating leases	$ 9.8	$ 8.5	$ 19.7	$ 18.1
Finance leases
Amortization	1.5	1.0	3.0	2.0
Interest	0.2	0.2	0.4	0.4
Total finance leases	$ 1.7	$ 1.2	$ 3.4	$ 2.4

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Leases - Annual Future Maturities of Leases (Details) - USD ($) $ in Millions	Jul. 03, 2021	Dec. 31, 2020
Operating Leases
2021	$ 16.5
2022	28.0
2023	20.7
2024	17.6
2025	15.7
After 2025	106.9
Total lease payments	205.4
Less: Interest	27.9
Present value of lease liabilities	177.5	$ 160.8
Finance Leases
2021	3.0
2022	5.5
2023	3.9
2024	2.4
2025	2.2
After 2025	15.9
Total lease payments	32.9
Less: Interest	4.4
Present value of lease liabilities	28.5	26.9
Total
2021	19.5
2022	33.5
2023	24.6
2024	20.0
2025	17.9
After 2025	122.8
Total lease payments	238.3
Less: Interest	32.3
Present value of lease liabilities	$ 206.0	$ 187.7

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Leases - Weighted Average Lease Terms and Discount Rates (Details)	Jul. 03, 2021	Jun. 27, 2020
Leases [Abstract]
Weighted-average remaining lease term - Operating leases	11 years 7 months 2 days	6 years 3 months 21 days
Weighted-average lease term - Finance leases	9 years 2 months 26 days	9 years 10 months 20 days
Weighted-average discount rate - Operating lease (percent)	2.71%	3.73%
Weighted-average discount rate - Finance lease (percent)	2.76%	3.39%

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Leases - Lease Cash Flow Classifications (Details) - USD ($) $ in Millions	6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020
Leases [Abstract]
Operating cash flows for operating leases	$ 18.2	$ 17.3
Operating cash flows for finance leases	0.4	0.4
Financing cash flows for finance leases	2.6	1.9
Leased assets obtained in exchange for new finance lease liabilities	4.4	2.2
Leased assets obtained in exchange for new operating lease liabilities	$ 34.9	$ 22.3

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Indebtedness - Schedule of Borrowings Outstanding (Details) - USD ($) $ in Millions		6 Months Ended
		Jul. 03, 2021	Dec. 31, 2020	Jun. 19, 2020
Debt Instrument [Line Items]
Notes and Bonds		$ 2,920.2	$ 2,924.9
Other financing		53.4	57.4
Unamortized premium (discount), net		(2.1)	(0.3)
Deferred financing fees		(15.6)	(17.1)
Total borrowings outstanding		3,555.9	3,564.9
Current indebtedness		(630.1)	(37.3)
Long-term debt, less current portion		2,925.8	3,527.6
2019 Term loan due August 15, 2022
Debt Instrument [Line Items]
Term loans		$ 600.0	600.0
5.105% Senior note due July 28, 2023
Debt Instrument [Line Items]
Interest rate, stated percentage		5.105%
Series	[1]	July 28, 2023(1)
Notes and Bonds		$ 160.2	164.9
4.00% unsecured senior notes due November 15, 2023
Debt Instrument [Line Items]
Interest rate, stated percentage		4.00%
Series		November 15, 2023
Notes and Bonds		$ 215.6	215.6
3.9% senior note due December 15, 2024
Debt Instrument [Line Items]
Interest rate, stated percentage		3.90%
Series		December 15, 2024
Notes and Bonds		$ 700.0	700.0
4.375% senior note due March 15, 2026
Debt Instrument [Line Items]
Interest rate, stated percentage		4.375%
Series		March 15, 2026
Notes and Bonds		$ 700.0	700.0
3.150% Senior Notes due June 15, 2030
Debt Instrument [Line Items]
Interest rate, stated percentage		3.15%		3.15%
Series		June 15, 2030
Notes and Bonds		$ 750.0	750.0
5.30% unsecured senior notes due November 15, 2043
Debt Instrument [Line Items]
Interest rate, stated percentage		5.30%
Series		November 15, 2043
Notes and Bonds		$ 90.5	90.5
4.9% senior notes due December 15, 2044
Debt Instrument [Line Items]
Interest rate, stated percentage		4.90%
Series		December 15, 2044
Notes and Bonds		$ 303.9	$ 303.9

[1] Debt denominated in euros subject to fluctuations in the euro-to-U.S. dollar exchange rate.

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Indebtedness - Additional Information (Details)					3 Months Ended		6 Months Ended
	Jun. 19, 2021 USD ($)	Jun. 07, 2021 USD ($)	Dec. 08, 2020 USD ($)	Jul. 06, 2020 USD ($)	Dec. 31, 2021	Sep. 30, 2021	Jul. 03, 2021 USD ($)	Dec. 31, 2020 USD ($)	Jun. 19, 2020 USD ($)	Jun. 17, 2020 USD ($) promissoryNote	Aug. 15, 2019 USD ($)	Mar. 08, 2018 USD ($)
Debt Instrument [Line Items]
Outstanding balance							$ 0	$ 0
Kazmira, LLC
Debt Instrument [Line Items]
Promissory notes										$ 34,300,000
Number of promissory notes | promissoryNote										2
2018 Revolver due March 8, 2023
Debt Instrument [Line Items]
Face amount of debt												$ 1,000,000,000.0
Borrowings on line of credit							$ 0	$ 0
2019 Term loan due August 15, 2022
Debt Instrument [Line Items]
Face amount of debt											$ 600,000,000.0
Maximum leverage ratio							375.00%
2019 Term loan due August 15, 2022 | Forecast
Debt Instrument [Line Items]
Maximum leverage ratio					375.00%	575.00%
Maximum leverage ratio, subject to consummation of qualifying acquisitions					4.00
3.150% Senior Notes due June 15, 2030
Debt Instrument [Line Items]
Face amount of debt									$ 750,000,000.0
Interest rate, stated percentage							3.15%		3.15%
Net proceeds from issuance of senior notes	$ 737,100,000
3.500% Unsecured Senior notes due March 15, 2021
Debt Instrument [Line Items]
Interest rate, stated percentage				3.50%
Debt repaid				$ 280,400,000
3.500% Senior note due December 15, 2021
Debt Instrument [Line Items]
Interest rate, stated percentage				3.50%
Debt repaid				$ 309,600,000
Note due November 2020 | Kazmira, LLC
Debt Instrument [Line Items]
Debt repaid			$ 3,700,000
Promissory notes										$ 3,700,000
Note due May 2021 | Kazmira, LLC
Debt Instrument [Line Items]
Debt repaid		$ 5,800,000
Promissory notes										5,800,000
Note due November 2021 | Kazmira, LLC
Debt Instrument [Line Items]
Promissory notes										$ 24,800,000

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Earnings Per Share and Shareholders' Equity (Details) - USD ($)	3 Months Ended				6 Months Ended
	Jul. 03, 2021	Apr. 03, 2021	Jun. 27, 2020	Mar. 28, 2020	Jul. 03, 2021	Jun. 27, 2020	Oct. 31, 2018
Numerator:
Income (loss) from continuing operations	$ (111,900,000)		$ 12,400,000		$ (109,100,000)	$ 70,100,000
Income from discontinued operations, net of tax	54,200,000		48,200,000		89,500,000	96,900,000
Net income (loss)	$ (57,700,000)	$ 38,100,000	$ 60,600,000	$ 106,400,000	$ (19,600,000)	$ 167,000,000.0
Denominator:
Weighted average shares outstanding for basic EPS (in shares)	133,600,000		136,400,000		133,400,000	136,300,000
Dilutive effect of share-based awards (in shares)	0		1,100,000		0	1,000,000.0
Weighted average shares outstanding for diluted EPS (in shares)	133,600,000		137,500,000		133,400,000	137,300,000
Anti-dilutive share-based awards excluded from computation of diluted EPS (shares)	0		1,500,000		0	1,500,000
Stock repurchase program, authorized amount							$ 1,000,000,000.0
Repurchases of ordinary shares (shares)	0		0		0	0

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Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions	3 Months Ended				6 Months Ended
	Jul. 03, 2021	Apr. 03, 2021	Jun. 27, 2020	Mar. 28, 2020	Jul. 03, 2021	Jun. 27, 2020
Accumulated Other Comprehensive Income [Roll Forward]
Balance, beginning	$ 5,558.0	$ 5,655.1	$ 5,786.4	$ 5,803.8	$ 5,655.1	$ 5,803.8
OCI before reclassifications					(87.9)
Amounts reclassified from AOCI					0.0
Other comprehensive income (loss), net of tax	30.4	(118.3)	84.8	(103.5)	(87.9)	(18.7)
Balance, ending	5,511.1	5,558.0	5,910.4	5,786.4	5,511.1	5,910.4
Fair Value of Derivative Financial Instruments, net of tax
Accumulated Other Comprehensive Income [Roll Forward]
Balance, beginning		(0.7)			(0.7)
OCI before reclassifications					(7.3)
Amounts reclassified from AOCI					0.0
Other comprehensive income (loss), net of tax					(7.3)
Balance, ending	(8.0)				(8.0)
Foreign Currency Translation Adjustments
Accumulated Other Comprehensive Income [Roll Forward]
Balance, beginning		407.3			407.3
OCI before reclassifications					(79.1)
Amounts reclassified from AOCI					0.0
Other comprehensive income (loss), net of tax					(79.1)
Balance, ending	328.2				328.2
Post-Retirement and Pension Liability Adjustments, net of tax
Accumulated Other Comprehensive Income [Roll Forward]
Balance, beginning		(11.6)			(11.6)
OCI before reclassifications					(1.5)
Amounts reclassified from AOCI					0.0
Other comprehensive income (loss), net of tax					(1.5)
Balance, ending	(13.1)				(13.1)
Total AOCI
Accumulated Other Comprehensive Income [Roll Forward]
Balance, beginning	276.7	395.0	35.9	139.4	395.0	139.4
Other comprehensive income (loss), net of tax	30.4	(118.3)	84.8	(103.5)
Balance, ending	$ 307.1	$ 276.7	$ 120.7	$ 35.9	$ 307.1	$ 120.7

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Income Taxes (Details) € in Millions, $ in Millions								3 Months Ended		6 Months Ended		12 Months Ended
	Jul. 09, 2021 USD ($)	May 03, 2021	Feb. 26, 2021 USD ($)	Jan. 13, 2021 USD ($)	Dec. 19, 2020 USD ($)	May 07, 2020 USD ($)	Aug. 15, 2017 USD ($)	Jul. 03, 2021 USD ($)	Jun. 27, 2020	Jul. 03, 2021 USD ($) year	Jun. 27, 2020	Dec. 31, 2020 USD ($)	Dec. 31, 2013	Dec. 31, 2012 USD ($)	Dec. 31, 2011 USD ($)	Dec. 31, 2010 USD ($)	Dec. 31, 2009 USD ($)	Jul. 09, 2021 EUR (€)	Dec. 29, 2020 USD ($)	Apr. 26, 2019 USD ($)	Nov. 29, 2018 EUR (€)
Income Tax Contingency [Line Items]
Effective income tax rate reconciliation, percent								28.80%	19.70%	22.10%	3.90%
Income tax examination, penalties and interest expense							$ 134.1							$ 24.7	$ 40.1	$ 41.8	$ 27.5
Cumulative deferred charge related to tax litigation								$ 111.6		$ 111.6
Royalty conceded on all omeprazole sales as a percent of refund claims (percent)										5.24%
IRS Notice of Proposed Audit Adjustment from 2013, 2014 and 2015				$ 141.6
IRS Notice of Proposed Audit Adjustment for ANDA from 2013, 2014 and 2015				21.9
Income tax examination, debts subject to limit of deductibility of interest expense				7,500.0
Interest rate cap on debts for U.S. Federal tax purposes, as percent of Applicable Federal Rate						130.00%
Income tax examination, reduction in blended interest rate due to cap for U.S. Federal tax purposes						4.00%
IRS notice of proposed audit adjustment to reduce deductible interest expense for fiscal years 2014 and 2015						$ 414.7
Interest rate cap on debts for U.S. Federal tax purposes, as percent of Applicable Federal Rate, no longer pursued		130.00%
IRS notice of proposed audit adjustment, increase to gross sales revenue for the 2013, 2014 and 2015 tax years					$ 99.5
IRS notice of proposed adjustment amount from 2011,2012 and 2013 audit of Athena, including penalty																				$ 843.0
IRS notice of proposed adjustment, penalty (percent)																				40.00%
Tax Years 2013 - 2015
Income Tax Contingency [Line Items]
Income tax examination, estimate of additional tax expense, excluding interest and penalties			$ 18.0
Tax Year 2020
Income Tax Contingency [Line Items]
Income tax examination, estimate of additional tax expense, excluding interest and penalties												$ 7.0
Internal Revenue Service (IRS)
Income Tax Contingency [Line Items]
Income tax examination, number of taxable years | year										4
Revenue Commissioners, Ireland
Income Tax Contingency [Line Items]
Irish Revenue notice of amended assessment unsettled assessed audit liability | €																					€ 1,643.0
Irish Revenue proposed tax rate on net chargeable gain realized (percent)													33.00%
Irish Revenue tax rate applied to trading income (percent)													12.50%
Unsettled audit assessment from income tax examination | €																					€ 1,636.0
Revenue Commissioners, Ireland | Subsequent Event
Income Tax Contingency [Line Items]
Income tax examination, estimate of additional tax expense, excluding interest and penalties	$ 1,000.0
Irish Revenue, potential reduction in tax assessment | €																		€ 660.0
Israel Tax Authority
Income Tax Contingency [Line Items]
Income tax examination, number of taxable years | year										5
Unsettled audit assessment from income tax examination																			$ 63.8
Income tax examination, taxes paid										$ 19.0
Income tax examination, offset for tax refunds										17.2
Payment to resolve tax liability indemnity										12.5
Reduction in liability recorded for uncertain tax positions								$ 38.3		$ 38.3
Minimum
Income Tax Contingency [Line Items]
Income tax examination, estimate of additional tax expense, excluding interest and penalties				24.0
Maximum
Income Tax Contingency [Line Items]
Income tax examination, estimate of additional tax expense, excluding interest and penalties				$ 112.0

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Contingencies (Details) $ in Millions, ₪ in Billions						1 Months Ended	3 Months Ended	6 Months Ended	12 Months Ended
	Jul. 13, 2021 complaint tender lawsuit	May 31, 2019 individual	Jan. 16, 2019 defendant genericPrescriptionPharmaceutical	Jun. 28, 2017 USD ($) genericPrescriptionPharmaceutical individual case $ / ₪	Jun. 28, 2017 ILS (₪) genericPrescriptionPharmaceutical individual case $ / ₪	Sep. 30, 2020 lawsuit	Mar. 28, 2020 case	Jul. 03, 2021 USD ($) case individual complaint defendant appeal genericPrescriptionPharmaceutical claim retailer class lawsuit	Dec. 31, 2018 case brand	Dec. 31, 2017 USD ($) case	May 31, 2021 policyPeriod	Dec. 31, 2020 USD ($)	Dec. 15, 2020 manufacturer brand pharmaceuticalCompany	Dec. 14, 2020 manufacturer	Dec. 11, 2020 manufacturer	Sep. 26, 2020 manufacturer	Sep. 04, 2020 manufacturer	Aug. 27, 2020 manufacturer	Jul. 14, 2020 brand manufacturer case	Jul. 09, 2020 pharmaceuticalCompany	Jun. 10, 2020 employee plaintiffGroup pharmaceuticalProduct manufacturer	Jun. 09, 2020 manufacturer	May 31, 2020 healthPlan individual manufacturer	Mar. 01, 2020 defendant	Dec. 27, 2019 defendant	Dec. 23, 2019 defendant	Dec. 16, 2019 defendant	Dec. 11, 2019 defendant	Nov. 14, 2019 class	Jul. 18, 2019 manufacturer individual healthPlan	Apr. 30, 2019 genericPrescriptionPharmaceutical pharmaceuticalProduct manufacturer	Dec. 21, 2018 genericPrescriptionPharmaceutical manufacturer	Aug. 03, 2018 manufacturer genericPrescriptionPharmaceutical	Jul. 31, 2018 individual	Jan. 22, 2018 manufacturer genericPrescriptionPharmaceutical supermarket	Jun. 30, 2017 case	Jun. 21, 2017 genericPrescriptionPharmaceutical individual class
Loss Contingencies [Line Items]
Number of putative classes | class								3																					3								3
Number of sets of class action complaints | complaint								2
Number of generic prescription pharmaceuticals | genericPrescriptionPharmaceutical																																					6
Number of individuals | individual																																					11
Number of current or former directors and officers | individual																																					11
Loss accrual for litigation contingencies | $								$ 65.0
Insurance recovery receivable | $								56.2
Insurance coverage available to defend and satisfy judgments, number of policy periods | policyPeriod											1
Level 3
Loss Contingencies [Line Items]
Guaranty liability | $								$ 0.6		$ 13.8		$ 13.2
States' May 2019 Case Alleging Conspiracy (which does not Name Perrigo a Defendant)
Loss Contingencies [Line Items]
Number of products included in expedited cases | brand																			120
Number of manufacturers																			35
Overarching Conspiracy Class Actions
Loss Contingencies [Line Items]
Number of manufacturers																															27
Number of generic prescription pharmaceuticals | genericPrescriptionPharmaceutical																															135
Number of formulations of products manufactured by the Company | genericPrescriptionPharmaceutical																															2
Number of products manufactured by the Company | pharmaceuticalProduct																															1
Number of cases included in expedited schedule | case																			0
Price-Fixing Lawsuit, Supermarket Chains
Loss Contingencies [Line Items]
Number of manufacturers														45																					35
Number of generic prescription pharmaceuticals | genericPrescriptionPharmaceutical																																			31
Number of supermarket chains | supermarket																																			3
Price-Fixing Lawsuit, Supermarket Chains, Amended Complaint
Loss Contingencies [Line Items]
Number of manufacturers																																39
Number of generic prescription pharmaceuticals | genericPrescriptionPharmaceutical																																33
Price-fixing Lawsuit, Managed Care Organization
Loss Contingencies [Line Items]
Number of manufacturers																																	27
Number of generic prescription pharmaceuticals | genericPrescriptionPharmaceutical																																	17
Price-fixing Lawsuit, Health Insurance Carrier
Loss Contingencies [Line Items]
Number of manufacturers																						25
Number of generic prescription pharmaceuticals | genericPrescriptionPharmaceutical			30
Number of defendants | defendant			30
Price-fixing Lawsuit, Healthcare Service Company
Loss Contingencies [Line Items]
Number of co-defendants | defendant																												38
Price-Fixing Lawsuit, Suffolk County of New York
Loss Contingencies [Line Items]
Number of manufacturers																		35
Price-Fixing Lawsuit, Drug Wholesaler and Distributor
Loss Contingencies [Line Items]
Number of manufacturers																	39
Price-fixing Lawsuit, Medicare Advantage Claims Recovery Company
Loss Contingencies [Line Items]
Number of co-defendants | defendant																											39
Price-Fixing Lawsuit, Drugstore Chain
Loss Contingencies [Line Items]
Number of manufacturers													45		45
Number of products manufactured by the Company | brand													63
Number of other pharmaceutical companies | pharmaceuticalCompany																				39
Price-fixing Lawsuit, Healthcare Management Organization
Loss Contingencies [Line Items]
Number of co-defendants | defendant																									25
Price-fixing Lawsuit, Several Counties in New York
Loss Contingencies [Line Items]
Number of other pharmaceutical companies | pharmaceuticalCompany													45
Number of co-defendants | defendant																										28
Price-fixing Lawsuit, Harris County of Texas
Loss Contingencies [Line Items]
Number of co-defendants | defendant																								29
Price-fixing Lawsuit, Health Plans
Loss Contingencies [Line Items]
Number of manufacturers																														53
Number of health plans | healthPlan																							7							87
Number of individuals | individual																							17							17
Number of dozens of manufacturers																							3
State Attorney General Complaint
Loss Contingencies [Line Items]
Number of manufacturers																					35
Number of generic prescription pharmaceuticals | pharmaceuticalProduct																					80
Number of additional states and territories | plaintiffGroup																					50
Number of former employees | employee																					1
Number of current employees | employee																					1
Canadian Class Action Complaint
Loss Contingencies [Line Items]
Number of manufacturers																29
Highfields Capital I LP, et al. v. Perrigo Company plc, et al.
Loss Contingencies [Line Items]
Number of cases alleging only state law claims | lawsuit								1
Carmignac, First Manhattan and Similar Cases
Loss Contingencies [Line Items]
Number of cases with similar factual allegations | case								7
First Manhattan and Similar Cases
Loss Contingencies [Line Items]
Number of generic prescription pharmaceuticals | case								6
Mason Capital, Pentwater and Similar Cases
Loss Contingencies [Line Items]
Number of generic prescription pharmaceuticals | genericPrescriptionPharmaceutical								6
Number of cases with similar factual allegations | case								8
Number of current or former directors and officers | case								11
Harel Insurance and TIAA-CREF Cases
Loss Contingencies [Line Items]
Number of generic prescription pharmaceuticals | genericPrescriptionPharmaceutical								6
Number of individuals | individual																																		11
Number of cases with similar factual allegations | case								2
Number of current or former directors and officers | individual								13
Number of defendants added | defendant								2
Number of defendants dismissed without prejudice | individual																																		8
Blackrock Global Complaint
Loss Contingencies [Line Items]
Number of generic prescription pharmaceuticals | genericPrescriptionPharmaceutical								6
Other Cases Related to Events in 2015-2017
Loss Contingencies [Line Items]
Number of cases with similar factual allegations | case																																				1
Number of overlapped cases | case																																				3
Israel Elec. Corp. Employees' Educ. Fund v. Perrigo Company plc, et al.
Loss Contingencies [Line Items]
Number of generic prescription pharmaceuticals | genericPrescriptionPharmaceutical				6	6
Number of cases voluntarily dismissed | case				2	2
Number of current or former directors and officers | individual				11	11
Damages sought by plaintiff				$ 760.0	₪ 2.7
Foreign currency exchange rate, remeasurement | $ / ₪				0.28	0.28
Talcum Powder Litigation | Subsequent Event
Loss Contingencies [Line Items]
Number of lawsuits | lawsuit	44
Number of tenders accepted for a portion of the defense costs and liability from a retailer | tender	1
Ranitidine Litigation
Loss Contingencies [Line Items]
Number of master complaints | complaint								3
Number of master complaints naming the company | complaint								3
Number of appeals of master complaints | appeal								1
Number of appeals of personal injury claims | appeal								2
Ranitidine Litigation | Subsequent Event
Loss Contingencies [Line Items]
Number of personal injury lawsuits | complaint	245
In Israel (Cases Related to Events in 2015-2017)
Loss Contingencies [Line Items]
Number of cases | case									3
Number of cases voluntarily dismissed | case									1	1
Number of cases stayed | brand									1
In the United States (Cases Related to Irish Tax Events)
Loss Contingencies [Line Items]
Number of defendants | individual		3
Number of defendants added | individual		1
In Israel (Cases Related to Irish Tax Events)
Loss Contingencies [Line Items]
Number of cases stayed | case							2
Acetaminophen Litigation
Loss Contingencies [Line Items]
Number of lawsuits | lawsuit						1
Number of claims for indemnification or defense | claim								16
Number of retailers | retailer								10

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Restructuring Charges (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020
Restructuring Reserve [Roll Forward]
Beginning balance	$ 6.2	$ 16.0	$ 9.1	$ 19.5
Additional charges	9.0	0.7	10.7	0.7
Payments	(5.1)	(7.3)	(9.5)	(10.8)
Non-cash adjustments	0.1	0.0	(0.1)	0.0
Ending balance	$ 10.2	$ 9.4	$ 10.2	$ 9.4

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Segment Information (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jul. 03, 2021	Jun. 27, 2020	Jul. 03, 2021	Jun. 27, 2020	Dec. 31, 2020
Segment Reporting Information [Line Items]
Assets	$ 11,230.3		$ 11,230.3		$ 11,488.4
Net sales	981.1	$ 948.8	1,991.1	$ 2,032.0
Operating Income (Loss)	(125.9)	62.7	(74.6)	149.1
Intangible Asset Amortization	53.4	51.6	106.6	104.2
Unallocated
Segment Reporting Information [Line Items]
Net sales	0.0	0.0	0.0	0.0
Operating Income (Loss)	(55.2)	(52.4)	(117.0)	(113.2)
Intangible Asset Amortization	0.0	0.0	0.0	0.0
Held-for-sale
Segment Reporting Information [Line Items]
Assets	2,089.3		2,089.3		2,030.9
CSCA
Segment Reporting Information [Line Items]
Assets	4,417.1		4,417.1		4,585.1
Net sales	622.3	627.7	1,262.8	1,328.2
CSCA | Operating Segments
Segment Reporting Information [Line Items]
Net sales	622.3	627.7	1,262.8	1,328.2
Operating Income (Loss)	(72.0)	104.6	23.6	226.7
Intangible Asset Amortization	12.9	13.2	25.8	27.5
CSCI
Segment Reporting Information [Line Items]
Assets	4,723.9		4,723.9		$ 4,872.4
Net sales	358.8	321.1	728.3	703.8
CSCI | Operating Segments
Segment Reporting Information [Line Items]
Net sales	358.8	321.1	728.3	703.8
Operating Income (Loss)	1.3	10.5	18.8	35.6
Intangible Asset Amortization	$ 40.5	$ 38.4	$ 80.8	$ 76.7

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Subsequent Events (Details) $ in Millions	Jul. 06, 2021 USD ($)
Discontinued Operations, Disposed of by Sale | RX | Subsequent Event
Subsequent Event [Line Items]
Total consideration	$ 1,550