Segment Information

6 Months Ended

Jun. 30, 2013

Segment Reporting [Abstract]

Segment Information

Segment Information

Mylan has two segments, “Generics” and “Specialty.” The Generics segment primarily develops, manufactures, sells and distributes generic or branded generic pharmaceutical products in tablet, capsule, injectable or transdermal patch form, as well as active pharmaceutical ingredients (“API”). The Specialty segment engages mainly in the development, manufacture and sale of branded specialty nebulized and injectable products. Beginning with the first quarter of 2013, the Company reorganized the components of its Generics and Specialty segments as a result of a change in the way the Chief Executive Officer, who is the chief operating decision maker, evaluates the performance of operations, develops strategy and allocates capital resources. As required by the applicable accounting standards, financial statements issued subsequent to this segment reporting change are required to reflect modifications to the reportable segment information resulting from the revision, including reclassifications of all comparative segment information. Accordingly, the results presented below reflect the change in segment reporting for all periods presented. There is no change to the Company’s previously reported consolidated net operating results, financial position or cash flows.

The Company’s chief operating decision maker evaluates the performance of its segments based on total revenues and segment profitability. Segment profitability represents segment gross profit less direct research and development expenses and direct selling, general and administrative expenses. Certain general and administrative and research and development expenses not allocated to the segments, net charges for litigation settlements, impairment charges and other expenses not directly attributable to the segments, are reported in Corporate/Other. Additionally, amortization of intangible assets and other purchase accounting related items, as well as any other significant special items, are included in Corporate/Other. Items below the earnings from operations line on the Company’s Condensed Consolidated Statements of Operations are not presented by segment, since they are excluded from the measure of segment profitability. The Company does not report depreciation expense, total assets and capital expenditures by segment, as such information is not used by the chief operating decision maker.

The accounting policies of the segments are the same as those described in the “Summary of Significant Accounting Policies” included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012. Intersegment revenues are accounted for at current market values and are eliminated at the consolidated level.

Presented in the table below is segment information for the periods identified and a reconciliation of segment information to total consolidated information.

(In thousands)	Generics Segment		Specialty Segment		Corporate / Other(1)			Consolidated
Three Months Ended June 30, 2013
Total revenues
Third party	$	1,458,214	$	243,487	$	—		$	1,701,701
Intersegment	1,824		5,904		(7,728		)	—
Total	$	1,460,038	$	249,391	$	(7,728	)	$	1,701,701
Segment profitability	$	412,230	$	107,761	$	(211,372	)	$	308,619
Six Months Ended June 30, 2013
Total revenues
Third party	$	2,871,031	$	462,160	$	—		$	3,333,191
Intersegment	2,453		13,832		(16,285		)	—
Total	$	2,873,484	$	475,992	$	(16,285	)	$	3,333,191
Segment profitability	$	804,290	$	197,568	$	(479,392	)	$	522,466

(In thousands)	Generics Segment		Specialty Segment		Corporate / Other(1)			Consolidated
Three Months Ended June 30, 2012
Total revenues
Third party	$	1,481,120	$	206,695	$	—		$	1,687,815
Intersegment	388		9,093		(9,481		)	—
Total	$	1,481,508	$	215,788	$	(9,481	)	$	1,687,815
Segment profitability	$	407,865	$	68,682	$	(215,076	)	$	261,471
Six Months Ended June 30, 2012
Total revenues
Third party	$	2,893,596	$	377,874	$	—		$	3,271,470
Intersegment	743		23,672		(24,415		)	—
Total	$	2,894,339	$	401,546	$	(24,415	)	$	3,271,470
Segment profitability	$	819,529	$	129,140	$	(436,660	)	$	512,009

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⁽¹⁾  Includes certain corporate general and administrative and research and development expenses; net charges for litigation settlements; certain intercompany transactions, including eliminations; amortization of intangible assets and certain purchase accounting items; impairment charges; and other expenses not directly attributable to segments.