Segment Data

3 Months Ended

Mar. 26, 2021

Segment Reporting [Abstract]

Segment Data

13. Segment Data

The Company operates in two reportable segments, which are further described below:

•Specialty Brands includes innovative specialty pharmaceutical brands; and

•Specialty Generics includes niche specialty generic drugs and APIs.

Management measures and evaluates the Company's operating segments based on segment net sales and operating income. Management excludes corporate expenses from segment operating income. In addition, certain amounts that management considers to be non-recurring or non-operational are excluded from segment net sales and operating income because management and the chief operating decision maker evaluate the operating results of the segments excluding such items. These items may include, but are not limited to, depreciation and amortization, share-based compensation, net restructuring charges, non-restructuring impairment charges, separation costs, changes related to the Opioid-Related Litigation Settlement. During the three months ended September 25, 2020, the Company began excluding depreciation and share-based compensation from its evaluation of the operating results of its segments. As a result, prior period segment operating income has been recast to reflect this change on a comparable basis. Although these amounts are excluded from segment net sales and operating income, as applicable, they are included in reported consolidated net sales and operating income (loss) and are reflected in the reconciliations presented below.

Selected information by reportable segment was as follows:

	Three Months Ended
	March 26, 2021		March 27, 2020
Net sales:
Specialty Brands	$	408.4	$	490.6
Specialty Generics	149.6		175.2
Net sales	$	558.0	$	665.8
Operating loss:
Specialty Brands	$	212.1	$	220.5
Specialty Generics	31.7		63.2
Segment operating income	243.8		283.7
Unallocated amounts:
Corporate and unallocated expenses (1)	(22.6)		(57.5)
Depreciation and amortization	(169.6)		(223.1)
Share-based compensation	(3.6)		(6.7)
Restructuring charges, net	(0.4)		1.8
Non-restructuring impairment charges	(64.5)		—
Separation costs (2)	(0.6)		(21.3)
Opioid-related litigation settlement gain (3)	—		16.8
Operating loss	$	(17.5)	$	(6.3)

(1)Includes administration expenses and certain compensation, legal, environmental and other costs not charged to the Company's reportable segments.

(2)Represents costs included in SG&A expenses, primarily related to professional fees and costs incurred in preparation for the Chapter 11 proceedings. As of the Petition Date, professional fees directly related to the Chapter 11 proceedings that were previously reflected as separation costs are being classified on a go-forward basis as reorganization items, net.

(3)Represents the change in the Settlement Warrants' fair value. Refer to Note 11 for further information.

Net sales by product family within the Company's reportable segments were as follows:

	Three Months Ended
	March 26, 2021		March 27, 2020
Acthar Gel (1)	$	129.0	$	167.6
INOmax	134.0		141.7
Ofirmev	12.8		74.9
Therakos	66.8		63.7
Amitiza (2)	61.4		41.1
Other	4.4		1.6
Specialty Brands	408.4		490.6
Hydrocodone (API) and hydrocodone-containing tablets	23.3		26.5
Oxycodone (API) and oxycodone-containing tablets	17.2		16.9
Acetaminophen (API)	45.5		44.1
Other controlled substances	58.1		83.6
Other	5.5		4.1
Specialty Generics	149.6		175.2
Net sales	$	558.0	$	665.8

(1)The three months ended March 26, 2021 includes the prospective change to the Medicaid rebate calculation that began in June 2020, which impacted Acthar Gel net sales by $12.5 million. See Note 11 for further detail on the status of the Medicaid lawsuit.

(2)Amitiza consists of both product net sales and royalties. Refer to Note 2 for further details on Amitiza's revenues.