PENSION AND POSTRETIREMENT EMPLOYEE BENEFIT PLANS

12 Months Ended

Dec. 31, 2012

PENSION AND POSTRETIREMENT EMPLOYEE BENEFIT PLANS

PENSION AND POSTRETIREMENT EMPLOYEE BENEFIT PLANS

15. PENSION AND POSTRETIREMENT EMPLOYEE BENEFIT PLANS

The Company operates defined contribution retirement plans in several countries, including Canada and the U.S. Under these plans, employees are allowed to contribute a portion of their salaries to the plans, and the Company matches a portion of the employee contributions. The Company contributed $2.8 million, $2.1 million and $2.9 million to these plans in the years ended December 31, 2012, 2011 and 2010, respectively.

Outside of the U.S., a limited group of Valeant employees are covered by defined benefit retirement and post-employment plans. The Company assumed all of Valeant’s defined benefit obligations and related plan assets in connection with the Merger. The Company contributed $1.8 million and $1.0 million to these plans in the years ended December 31, 2012 and 2011, respectively. As of December 31, 2012, the projected benefit obligation of these plans totaled $7.0 million, which exceeded the fair value of plan assets of $1.3 million by $5.7 million. The Company has recognized the under-funded financial position of these plans in accrued liabilities ($0.4 million) and other long-term liabilities ($5.3 million) as of December 31, 2012. The net periodic benefit cost of these plans amounted to $1.5 million and $2.1 million for the year ended December 31, 2012 and 2011, respectively. For the year ended December 31, 2010, the net periodic cost of was not material to the Company’s results of operations.