BUSINESS COMBINATIONS

The Company’s business strategy involves selective acquisitions with a focus on core geographies and therapeutic classes.

(a) Business combinations in 2014 included the following:

In the nine-month period ended September 30, 2014, the Company completed business combinations, which included the acquisition of the following businesses, for an aggregate purchase price of $1,046.6 million. The aggregate purchase price included contingent consideration payment obligations with an aggregate acquisition date fair value of $65.1 million.

•

On July 7, 2014, the Company acquired all of the outstanding common stock of PreCision Dermatology, Inc. (“PreCision”) for an aggregate purchase price of $454.5 million. The Company may also pay contingent consideration of $25.0 million upon the achievement of a sales-based milestone for 2014. The fair value of this contingent consideration was determined to be nominal as of the acquisition date, based on the current sales forecast. The Company recognized a post-combination expense of $20.4 million within Other (income) expense in the third quarter of 2014 related to the acceleration of unvested stock options for PreCision employees. In connection with the acquisition of PreCision, the Company was required by the Federal Trade Commission (“FTC”) to divest the rights to PreCision’s Tretin-X® (tretinoin) cream product and PreCision’s generic tretinoin gel and cream products. For further details, see note 4 titled “DIVESTITURES”. PreCision develops and markets a range of medical dermatology products, treating a number of topical disease states such as acne and atopic dermatitis with products such as Locoid® and Clindagel®.

•

On January 23, 2014, the Company acquired all of the outstanding common stock of Solta Medical, Inc. (“Solta Medical”) for $292.5 million, which includes $2.92 per share in cash and $44.2 million for the repayment of Solta Medical’s long-term debt, including accrued interest. In connection with the acquisition, the Company recognized a charge of $5.6 million in the first quarter of 2014 relating to a settlement of a pre-existing relationship with Solta Medical, which is included in Other (income) expense in the consolidated statements of income (loss). Solta Medical designs, develops, manufactures, and markets energy-based medical device systems for aesthetic applications. Solta Medical’s products include the Thermage CPT® system that provides non-invasive treatment options using radiofrequency energy for skin tightening, the Fraxel® repair system for use in dermatological procedures requiring ablation, coagulation, and resurfacing of soft tissue, the Clear + Brilliant® system to improve skin texture and help prevent the signs of aging skin, and the Liposonix® system that destroys unwanted fat cells resulting in waist circumference reduction.


•	During the nine-month period ended September 30, 2014, the Company completed other smaller acquisitions which are not material individually or in the aggregate. These acquisitions are included in the aggregated amounts presented below.

Assets Acquired and Liabilities Assumed

These transactions have been accounted for as business combinations under the acquisition method of accounting. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed related to the business combinations, in the aggregate, as of the applicable acquisition dates. Due to the timing of the PreCision acquisition, all such amounts are provisional and subject to change. The following recognized amounts related to the Solta Medical acquisition, as well as certain smaller acquisitions, are provisional and subject to change:


•	amounts for intangible assets, property and equipment, inventories, receivables and other working capital adjustments pending finalization of the valuation;


•	amounts for income tax assets and liabilities, pending finalization of estimates and assumptions in respect of certain tax aspects of the transaction; and


•	amount of goodwill pending the completion of the valuation of the assets acquired and liabilities assumed.

The Company will finalize these amounts as it obtains the information necessary to complete the measurement processes. Any changes resulting from facts and circumstances that existed as of the acquisition dates may result in retrospective adjustments to the provisional amounts recognized at the acquisition dates. These changes could be significant. The Company will finalize these amounts no later than one year from the respective acquisition dates.



	Amounts Recognized as of Acquisition Dates			Measurement Period Adjustments^(a)			Amounts Recognized as of September 30, 2014 (as adjusted)
Cash and cash equivalents	$	18.3		$	—		$	18.3
Accounts receivable^(b)	57.1			0.2			57.3
Assets held for sale^(c)	125.7			—			125.7
Inventories	87.0			(10.0		)	77.0
Other current assets	17.0			(0.8		)	16.2
Property, plant and equipment, net	37.3			(0.7		)	36.6
Identifiable intangible assets, excluding acquired IPR&D^(d)	590.3			15.0			605.3
Acquired IPR&D^(e)	65.8			0.8			66.6
Other non-current assets	3.4			—			3.4
Current liabilities	(129.3		)	(10.5		)	(139.8		)
Long-term debt, including current portion	(8.5		)	—			(8.5		)
Deferred income taxes, net	(112.0		)	(4.7		)	(116.7		)
Other non-current liabilities	(12.8		)	(3.1		)	(15.9		)
Total identifiable net assets	739.3			(13.8		)	725.5
Goodwill^(f)	315.0			6.1			321.1
Total fair value of consideration transferred	$	1,054.3		$	(7.7	)	$	1,046.6

________________________

(a)

The measurement period adjustments primarily relate to the Solta Medical acquisition and reflect: (i) increases in the estimated fair value of intangible assets, (ii) reductions in the estimated fair value of inventory, and (iii) the tax impact of pre-tax measurement period adjustments. The measurement period adjustments were made to reflect facts and circumstances existing as of the acquisition date, and did not result from intervening events subsequent to the acquisition date. These adjustments did not have a significant impact on the Company’s previously reported consolidated financial statements and, therefore, the Company has not retrospectively adjusted those financial statements.


(b)	The fair value of trade accounts receivable acquired was $57.3 million, with the gross contractual amount being $61.7 million, of which the Company expects that $4.4 million will be uncollectible.


(c)	Assets held for sale relate to the divestitures of the Tretin-X® product rights and the product rights for the generic tretinoin gel and cream products acquired in the PreCision acquisition. See note 4 titled “DIVESTITURES” for further information.


(d)	The following table summarizes the provisional amounts and useful lives assigned to identifiable intangible assets:



	Weighted- Average Useful Lives (Years)	Amounts Recognized as of Acquisition Dates		Measurement Period Adjustments			Amounts Recognized as of September 30, 2014 (as adjusted)
Product brands	10	$	468.4	$	14.2		$	482.6
Product rights	8	95.2		(0.9		)	94.3
Corporate brand	15	25.2		1.6			26.8
In-licensed products	8	1.5		0.1			1.6
Total identifiable intangible assets acquired	10	$	590.3	$	15.0		$	605.3


(e)	The acquired in-process research and development (“IPR&D”) assets primarily relate to programs from smaller acquisitions. In addition, the Solta Medical acquisition includes a program for the development of a next generation Thermage® product.

(f)

The goodwill relates primarily to the PreCision and Solta Medical acquisitions. Goodwill is calculated as the difference between the acquisition date fair value of the consideration transferred and the values assigned to the assets acquired and liabilities assumed. Substantially all of the goodwill is not expected to be deductible for tax purposes. The goodwill recorded from the PreCision and Solta Medical acquisitions represents the following:


•	cost savings, operating synergies and other benefits expected to result from combining the operations of PreCision and Solta Medical with those of the Company;


•	the Company’s expectation to develop and market new products and technology; and


•	intangible assets that do not qualify for separate recognition (for instance, Precision’s and Solta Medical’s assembled workforce).

The provisional amount of goodwill from the PreCision acquisition has been allocated to the Company’s Developed Markets segment ($181.3 million). The provisional amount of goodwill from the Solta Medical acquisition has been allocated to both the Company’s Developed Markets segment ($64.4 million) and Emerging Markets segment ($42.9 million).

Acquisition-Related Costs

The Company has incurred to date $4.2 million, in the aggregate, of transaction costs directly related to business combinations which closed in 2014, which includes expenditures for advisory, legal, valuation, accounting and other similar services. These costs have been expensed as acquisition-related costs.

Revenue and Net Loss

The revenues of these business combinations for the period from the respective acquisition dates to September 30, 2014 were $133.0 million, in the aggregate, and net loss was $44.4 million, in the aggregate. The net loss includes the effects of the acquisition accounting adjustments and acquisition-related costs.

(b) Business combinations in 2013 included the following:

B&L

Description of the Transaction

On August 5, 2013, the Company acquired B&L, pursuant to the Merger Agreement dated May 24, 2013 (as amended), among the Company, Valeant, Stratos Merger Corp., a Delaware corporation and wholly-owned subsidiary of Valeant (“Merger Sub”), and B&L. Pursuant to the terms and conditions set forth in the Merger Agreement, B&L became a wholly-owned subsidiary of Valeant. At the effective time of this merger, each share of B&L common stock, par value $0.01 per share, issued and outstanding immediately prior to such effective time, other than any dissenting shares and any shares held by B&L, Valeant, Merger Sub or any of their subsidiaries, was converted into the right to receive its pro rata share (the “Per Share Merger Consideration”), without interest, of an aggregate purchase price equal to $8.7 billion minus B&L’s existing indebtedness for borrowed money (which was paid off by Valeant in accordance with the terms of the Merger Agreement) and related fees and costs, minus certain of B&L’s transaction expenses, minus certain payments with respect to certain cancelled B&L performance-based options (which were not outstanding immediately prior to such effective time), plus the aggregate exercise price applicable to B&L’s outstanding options immediately prior to such effective time, and plus certain cash amounts, all as further described in the Merger Agreement. The B&L Acquisition was financed with debt and equity issuances. Each B&L restricted share and stock option, whether vested or unvested, that was outstanding immediately prior to such effective time, was cancelled and converted into the right to receive the Per Share Merger Consideration in the case of restricted shares or, in the case of stock options, the excess, if any, of the Per Share Merger Consideration over the exercise price of such stock option.

B&L is a global eye health company that focuses primarily on the development, manufacture and marketing of eye health products, including contact lenses, contact lens care solutions, ophthalmic pharmaceuticals and ophthalmic surgical products.

Fair Value of Consideration Transferred

The following table indicates the consideration transferred to effect the B&L Acquisition:



	Fair Value
Enterprise value	$	8,700.0
Adjusted for the following:
B&L’s outstanding debt, including accrued interest	(4,248.3		)
B&L’s company expenses	(6.4		)
Payment in B&L’s performance-based option^(a)	(48.5		)
Payment for B&L’s cash balance^(b)	149.0
Additional cash payment^(b)	75.0
Other	(3.2		)
Equity purchase price	4,617.6
Less: Cash consideration paid for B&L’s unvested stock options^(c)	(4.3		)
Total fair value of consideration transferred	$	4,613.3

___________________________________


(a)	The cash consideration paid for previously cancelled B&L’s performance-based options was recognized as a post-combination expense within Other (income) expense in the third quarter of 2013.


(b)	As defined in the Merger Agreement.


(c)	The cash consideration paid for B&L stock options and restricted stock attributable to pre-combination services has been included as a component of purchase price. The remaining $4.3 million balance related to the acceleration of unvested stock options for B&L employees was recognized as a post-combination expense within Other (income) expense in the third quarter of 2013.

Assets Acquired and Liabilities Assumed

The transaction has been accounted for as a business combination under the acquisition method of accounting. The following table summarizes the estimated fair values of the assets acquired and liabilities assumed as of acquisition date.



	Amounts Recognized as of Acquisition Date (as previously reported)^(a)			Measurement Period Adjustments^(b)			Amounts Recognized as of September 30, 2014 (as adjusted)
Cash and cash equivalents	$	209.5		$	(31.4	)	$	178.1
Accounts receivable^(c)	547.9			(7.2		)	540.7
Inventories^(d)	675.8			(34.0		)	641.8
Other current assets^(e)	146.6			0.3			146.9
Property, plant and equipment, net^(f)	761.4			33.2			794.6
Identifiable intangible assets, excluding acquired IPR&D^(g)	4,316.1			17.3			4,333.4
Acquired IPR&D^(h)	398.1			17.0			415.1
Other non-current assets	58.8			(1.9		)	56.9
Current liabilities⁽ⁱ⁾	(885.6		)	2.1			(883.5		)
Long-term debt, including current portion^(j)	(4,209.9		)	—			(4,209.9		)
Deferred income taxes, net^(k)	(1,410.9		)	36.0			(1,374.9		)
Other non-current liabilities^(l)	(280.2		)	(1.0		)	(281.2		)
Total identifiable net assets	327.6			30.4			358.0
Noncontrolling interest^(m)	(102.3		)	(0.4		)	(102.7		)
Goodwill⁽ⁿ⁾	4,388.0			(30.0		)	4,358.0
Total fair value of consideration transferred	$	4,613.3		$	—		$	4,613.3

________________________


(a)	As previously reported in the 2013 Form 10-K.

(b)

The measurement period adjustments primarily reflect: (i) a decrease in the net deferred tax liability, (ii) a reduction in the estimated fair value of inventory, (iii) an increase in the estimated fair value of property, plant and equipment mainly related to certain machinery and equipment in Western Europe and the U.S., partially offset by a reduction in the estimated fair value related to certain manufacturing facilities and an office building, (iv) an adjustment between cash and accounts payable, and (v) increases in the estimated fair value of intangible assets, which included a net increase to IPR&D assets driven by a higher fair value for the next generation silicone hydrogel lens (Bausch + Lomb Ultra®). The measurement period adjustments were made to reflect facts and circumstances existing as of the acquisition date, and did not result from intervening events subsequent to the acquisition date. These adjustments did not have a significant impact on the Company’s previously reported consolidated financial statements and, therefore, the Company has not retrospectively adjusted those financial statements.


(c)	The fair value of trade accounts receivable acquired was $540.7 million, with the gross contractual amount being $555.6 million, of which the Company expects that $14.9 million will be uncollectible.


(d)	Includes an estimated fair value adjustment to inventory of $269.1 million.


(e)	Includes primarily prepaid expenses.


(f)	The following table summarizes the amounts and useful lives assigned to property, plant and equipment:



	Weighted- Average Useful Lives (Years)	Amounts Recognized as of Acquisition Date (as previously reported)		Measurement Period Adjustments			Amounts Recognized as of September 30, 2014 (as adjusted)
Land	NA	$	47.4	$	(12.6	)	$	34.8
Buildings	24	273.1		(23.8		)	249.3
Machinery and equipment	5	273.5		76.3			349.8
Leasehold improvements	5	22.5		(0.3		)	22.2
Equipment on operating lease	3	13.8		(0.2		)	13.6
Construction in progress	NA	131.1		(6.2		)	124.9
Total property, plant and equipment acquired		$	761.4	$	33.2		$	794.6

The Company sold an office building in Rochester, New York, with an adjusted carrying amount of $14.2 million, in the third quarter of 2014. There was no gain or loss associated with the sale.


(g)	The following table summarizes the amounts and useful lives assigned to identifiable intangible assets:



	Weighted- Average Useful Lives (Years)	Amounts Recognized as of Acquisition Date (as previously reported)		Measurement Period Adjustments		Amounts Recognized as of September 30, 2014 (as adjusted)
Product brands	10	$	1,770.2	$	4.6	$	1,774.8
Product rights	8	855.4		5.7		861.1
Corporate brand	Indefinite	1,690.5		7.0		1,697.5
Total identifiable intangible assets acquired	9	$	4,316.1	$	17.3	$	4,333.4

The corporate brand represents the B&L corporate trademark and has an indefinite useful life as there are no legal, regulatory, contractual, competitive, economic, or other factors that limit the useful life of this intangible asset. The estimated fair value was determined using the relief from royalty method.

(h)

The significant components of the acquired IPR&D assets primarily relate to the development of (i) various vision care products ($223.4 million in the aggregate), such as the next generation silicone hydrogel lens (Bausch + Lomb Ultra®), (ii) various pharmaceutical products ($170.9 million, in the aggregate), such as latanoprostene bunod, a nitric oxide-donating prostaglandin for reduction of elevated intraocular pressure in patients with glaucoma or ocular hypertension, and (iii) various surgical products ($20.8 million, in the aggregate). A multi-period excess earnings methodology (income approach) was used to determine the estimated fair values of the acquired IPR&D assets from market participant perspective. The projected cash flows from these assets were adjusted for the probabilities of successful development and commercialization of each project. A risk-adjusted discount rate of 10% was used to present value the projected cash flows. The next generation silicone hydrogel lens (Bausch + Lomb Ultra®) was launched in February 2014.


(i)	Includes accrued liabilities, including reserves for sales returns, rebates and managed care, accounts payable and accrued compensation-related liabilities.


(j)	The following table summarizes the fair value of long-term debt assumed as of the acquisition date:



	Amounts Recognized as of Acquisition Date
Holdco unsecured term loan⁽¹⁾	$	707.0
U.S. dollar-denominated senior secured term loan⁽¹⁾	1,915.8
Euro-denominated senior secured term loan⁽¹⁾	604.0
U.S. dollar-denominated delayed draw term loan⁽¹⁾	398.0
U.S. dollar-denominated revolver loan⁽¹⁾	170.0
9.875% senior notes⁽¹⁾	350.0
Multi-currency denominated revolver loan⁽¹⁾	15.0
Japanese revolving credit facility⁽²⁾	33.8
Debentures	11.8
Other⁽¹⁾	4.5
Total long-term debt assumed	$	4,209.9

___________________________________


(1)	The Company subsequently repaid these amounts in full in the third quarter of 2013. In connection with the redemption of the 9.875% senior notes, the Company recognized a loss on extinguishment of debt of $8.2 million in the third quarter of 2013.


(2)	In the fourth quarter of 2013, the Company repaid in full the amounts outstanding. In January 2014, the Company terminated this facility.


(k)	Comprises current net deferred tax assets ($61.6 million) and non-current net deferred tax liabilities ($1,436.5 million).


(l)	Includes $224.2 million related to the estimated fair value of pension and other benefits liabilities.


(m)	Represents the estimated fair value of B&L’s noncontrolling interest related primarily to Chinese joint ventures. A discounted cash flow methodology was used to determine the estimated fair values as of the acquisition date.


(n)	Goodwill is calculated as the difference between the acquisition date fair value of the consideration transferred and the values assigned to the assets acquired and liabilities assumed. None of the goodwill is expected to be deductible for tax purposes. The goodwill recorded represents the following:


•	the Company’s expectation to develop and market new product brands, product lines and technology;


•	cost savings and operating synergies expected to result from combining the operations of B&L with those of the Company;


•	the value of the continuing operations of B&L’s existing business (that is, the higher rate of return on the assembled net assets versus if the Company had acquired all of the net assets separately); and


•	intangible assets that do not qualify for separate recognition (for instance, B&L’s assembled workforce).

The amount of goodwill has been allocated to the Company’s Developed Markets segment ($3.3 billion) and Emerging Markets segment ($1.1 billion).

Other Business Combinations

Description of the Transactions

In the year ended December 31, 2013, the Company completed other business combinations, which included the acquisition of the following businesses, for an aggregate purchase price of $898.1 million. The aggregate purchase price included contingent consideration payment obligations with an aggregate acquisition date fair value of $59.1 million.

•

On April 25, 2013, the Company acquired all of the outstanding shares of Obagi Medical Products, Inc. (“Obagi”) at a price of $24.00 per share in cash. The aggregate purchase price paid by the Company was approximately $437.1 million. Obagi is a specialty pharmaceutical company that develops, markets, and sells topical aesthetic and therapeutic skin-health systems with a product portfolio of dermatology brands including Obagi Nu-Derm®, Condition & Enhance®, Obagi-C® Rx, ELASTIDerm® and CLENZIDerm®.

•

On February 20, 2013, the Company acquired certain assets from Eisai Inc. (“Eisai”) relating to the U.S. rights to Targretin®, which is indicated for the treatment of Cutaneous T-Cell Lymphoma. The consideration includes up-front payments of $66.5 million and the Company may pay up to an additional $60.0 million of contingent consideration based on the occurrence of potential future events. The fair value of the contingent consideration was determined to be $50.8 million as of the acquisition date. As of September 30, 2014, the assumptions used for determining fair value of the contingent consideration have not changed significantly from those used at the acquisition date. In April 2014, the Company made a contingent consideration payment of $30.0 million.

•

On February 1, 2013, the Company acquired Natur Produkt International, JSC (“Natur Produkt”), a specialty pharmaceutical company in Russia, for a purchase price of $149.9 million, including a $20.0 million contingent refund of purchase price relating to the outcome of certain litigation involving AntiGrippin® that commenced prior to the acquisition. Subsequent to the acquisition, during the three-month period ended March 31, 2013, the litigation was resolved, and the $20.0 million was refunded back to the Company. Natur Produkt’s key brand products include AntiGrippin®, Anti-Angin®, Sage™ and Eucalyptus MA™.


•	During the year ended December 31, 2013, the Company completed other smaller acquisitions which are not material individually or in the aggregate. These acquisitions are included in the aggregated amounts presented below.

Assets Acquired and Liabilities Assumed



	Amounts Recognized as of Acquisition Dates			Measurement Period Adjustments^(a)			Amounts Recognized as of September 30, 2014 (as adjusted)
Cash	$	43.1		$	—		$	43.1
Accounts receivable^(b)	64.0			0.5			64.5
Inventories	33.6			1.9			35.5
Other current assets	14.0			—			14.0
Property, plant and equipment	13.9			(3.3		)	10.6
Identifiable intangible assets, excluding acquired IPR&D^(c)	722.9			3.9			726.8
Acquired IPR&D^(d)	18.7			0.2			18.9
Indemnification assets	3.2			(0.7		)	2.5
Other non-current assets	0.2			3.7			3.9
Current liabilities	(36.2		)	(0.4		)	(36.6		)
Short-term borrowings^(e)	(33.3		)	0.5			(32.8		)
Long-term debt^(e)	(24.0		)	—			(24.0		)
Deferred tax liability, net	(147.8		)	(1.1		)	(148.9		)
Other non-current liabilities	(1.5		)	—			(1.5		)
Total identifiable net assets	670.8			5.2			676.0
Noncontrolling interest^(f)	(11.2		)	—			(11.2		)
Goodwill^(g)	224.3			9.0			233.3
Total fair value of consideration transferred	$	883.9		$	14.2		$	898.1

________________________

(a)

The measurement period adjustments primarily reflect an increase in the total fair value of consideration transferred with respect to the Natur Produkt acquisition pursuant to a purchase price adjustment. The measurement period adjustments were made to reflect facts and circumstances existing as of the acquisition date, and did not result from intervening events subsequent to the acquisition date. These adjustments did not have a significant impact on the Company’s previously reported consolidated financial statements and, therefore, the Company has not retrospectively adjusted those financial statements.


(b)	The fair value of trade accounts receivable acquired was $64.5 million, with the gross contractual amount being $68.2 million, of which the Company expects that $3.7 million will be uncollectible.


(c)	The following table summarizes the amounts and useful lives assigned to identifiable intangible assets:



	Weighted- Average Useful Lives (Years)	Amounts Recognized as of Acquisition Dates		Measurement Period Adjustments		Amounts Recognized as of September 30, 2014 (as adjusted)
Product brands	7	$	517.2	$	3.1	$	520.3
Corporate brand	13	86.1		0.8		86.9
Patents	3	71.7		—		71.7
Royalty Agreement	5	26.5		—		26.5
Partner relationships	5	16.0		—		16.0
Technology	10	5.4		—		5.4
Total identifiable intangible assets acquired	8	$	722.9	$	3.9	$	726.8

(d)

The acquired IPR&D assets relate to the Obagi and Natur Produkt acquisitions. Obagi’s acquired IPR&D assets primarily relate to the development of dermatology products for anti-aging and suncare. Natur Produkt’s acquired IPR&D assets include a product indicated for the prevention of viral diseases, specifically cold and flu, and a product indicated for the treatment of inflammation and muscular disorders.


(e)	Short-term borrowings and long-term debt primarily relate to the Natur Produkt acquisition. In March 2013, the Company settled all of Natur Produkt’s outstanding third party short-term borrowings and long-term debt.


(f)	Represents the estimated fair value of noncontrolling interest related to a smaller acquisition completed in the third quarter of 2013.

(g)

The goodwill relates primarily to the Obagi and Natur Produkt acquisitions. Goodwill is calculated as the difference between the acquisition date fair value of the consideration transferred and the values assigned to the assets acquired and liabilities assumed. None of Obagi’s and Natur Produkt’s goodwill is expected to be deductible for tax purposes. The goodwill recorded from the Obagi and the Natur Produkt acquisitions represents primarily the cost savings, operating synergies and other benefits expected to result from combining the operations with those of the Company.

The amount of goodwill from the Eisai acquisition has been allocated to the Company’s Developed Markets segment. The amount of goodwill from the Natur Produkt acquisition has been allocated to the Company’s Emerging Markets segment. The amount of goodwill from the Obagi acquisition has been allocated primarily to the Company’s Developed Markets segment.

Pro Forma Impact of Business Combinations

The following table presents unaudited pro forma consolidated results of operations for the three-month and nine-month periods ended September 30, 2014 and 2013, as if the 2014 acquisitions had occurred as of January 1, 2013 and the 2013 acquisitions had occurred as of January 1, 2012.



	Three Months Ended September 30,					Nine Months Ended September 30,
	2014		2013			2014		2013
Revenues	$	2,060.2	$	1,867.3		$	6,039.6	$	5,794.9
Net income (loss) attributable to Valeant Pharmaceuticals International, Inc.	279.8		(907.8		)	376.1		(1,023.9		)

Earnings (loss) per share attributable to Valeant Pharmaceuticals International, Inc.:
Basic	$	0.83	$	(2.72	)	$	1.12	$	(3.07	)
Diluted	$	0.82	$	(2.72	)	$	1.10	$	(3.07	)

The increase in pro forma revenues in the nine-month period ended September 30, 2014 as compared to the nine-month period ended September 30, 2013 was primarily due to higher B&L revenues and growth from the remaining business, including the launches of Jublia®, Luzu™, and Retin-A Micro® Microsphere 0.08% ("RAM 0.08%"). These increases were partially offset by lower sales of the Vanos®, Retin-A Micro® (excluding RAM 0.08%), and Zovirax® franchises and Wellbutrin® XL (Canada) due to generic competition and lower sales of facial injectables (filler and toxin assets).

The unaudited pro forma consolidated results of operations were prepared using the acquisition method of accounting and are based on the historical financial information of the Company and the acquired businesses described above. Except to the extent realized in the three-month and nine-month periods ended September 30, 2014, the unaudited pro forma information does not reflect any cost savings, operating synergies and other benefits that the Company may achieve as a result of these acquisitions, or the costs necessary to achieve these cost savings, operating synergies and other benefits. In addition, except to the extent recognized in the three-month and nine-month periods ended September 30, 2014, the unaudited pro forma information does not reflect the costs to integrate the operations of the Company with those of the acquired businesses.

The unaudited pro forma information is not necessarily indicative of what the Company’s consolidated results of operations actually would have been had the 2014 acquisitions and the 2013 acquisitions been completed on January 1, 2013 and January 1, 2012, respectively. In addition, the unaudited pro forma information does not purport to project the future results of operations of the Company. The unaudited pro forma information reflects primarily the following adjustments:


•	elimination of the historical intangible asset amortization expense of these acquisitions;


•	additional amortization expense related to the fair value of identifiable intangible assets acquired;


•	additional depreciation expense related to fair value adjustment to property, plant and equipment acquired;


•	additional interest expense associated with the financing obtained by the Company in connection with the various acquisitions; and

•

the exclusion from pro forma earnings in the three-month and nine-month periods ended September 30, 2014 of (i) the acquisition accounting adjustments on these acquisitions’ inventories that were sold subsequent to the acquisition date and (ii) the acquisition-related costs incurred for these acquisitions, and the inclusion of those amounts in pro forma earnings for the corresponding comparative periods.

In addition, all of the above adjustments were adjusted for the applicable tax impact.