COMPREHENSIVE LOSS

9 Months Ended

Sep. 30, 2011

COMPREHENSIVE LOSS

COMPREHENSIVE LOSS

14.   COMPREHENSIVE LOSS

• Comprehensive loss for the three-month and nine-month periods ended September 30, 2011 and 2010 comprised the following:

		Three Months Ended September 30						Nine Months Ended September 30
		2011			2010			2011			2010
Net income (loss)		$	40,862		$	(207,882	)	$	103,704		$	(177,063	)
Comprehensive income (loss)
Foreign currency translation adjustment(a)			(471,075	)		4,590			(287,635	)		2,666
Net unrealized holding gain (loss) on available-for-sale equity securities(b):
	Arising in period		(21	)		—			21,146			—
	Reclassification to net income (loss)		170			—			(21,146	)		—
Net unrealized holding gain (loss) on available-for-sale debt securities:
	Arising in period		—			(69	)		(96	)		318
	Reclassification to net income (loss)		—			389			—			389
Pension adjustment(c)			(121	)		—			777			—
Acquisition of noncontrolling interest			1,849			—			1,849			—
Other comprehensive (loss) income			(469,198	)		4,910			(285,105	)		3,373
Comprehensive loss		$	(428,336	)	$	(202,972	)	$	(181,401	)	$	(173,690	)

(a)

Income taxes are not provided for foreign currency translation adjustments arising on the translation of the Company's operations having a functional currency other than the U.S. dollar, except to the extent of translation adjustments related to the Company's retained earnings for foreign jurisdictions in which the Company is not considered to be permanently reinvested.

(b)

Primarily reflects the gain recognized on the Company's investment in shares of common stock of Cephalon (as described in note 15).

(c)

Reflects changes in defined benefit obligations and related plan assets of legacy Valeant defined benefit pension plans.

• The components of accumulated other comprehensive loss as of September 30, 2011 were as follows:

	Foreign Currency Translation Adjustment			Net Unrealized Holding Gain on Available- For-Sale Equity Securities			Net Unrealized Holding Gain (Loss) on Available- For-Sale Debt Securities			Pension Adjustment		Acquisition of Noncontrolling Interest		Total
Balance, January 1, 2011	$	98,926		$	—		$	(90	)	$	—	$	—	$	98,836
Foreign currency translation adjustment		(287,635	)		—			—			—		—		(287,635	)
Net unrealized holding gain on available-for-sale equity securities		—			21,146			—			—		—		21,146
Reclassification to net income		—			(21,146	)		—			—		—		(21,146	)
Unrealized holding loss on available-for-sale debt securities		—			—			(96	)		—		—		(96	)
Pension adjustment		—			—			—			777		—		777
Acquisition of noncontrolling interest		—			—			—			—		1,849		1,849
Balance, September 30, 2011	$	(188,709	)	$	—		$	(186	)	$	777	$	1,849	$	(186,269	)