Revenue from Contracts with Customers Revenue from Contracts with Customers (Notes)

6 Months Ended

Jun. 25, 2021

Revenue from Contract with Customer [Abstract]

Revenue from Contract with Customer [Text Block]

3. Revenue from Contracts with Customers

Product Sales Revenue

See Note 13 for presentation of the Company's net sales by product family.

Reserves for variable consideration

The following table reflects activity in the Company's sales reserve accounts:

	Rebates and Chargebacks		Product Returns		Other Sales Deductions		Total
Balance as of December 27, 2019	$	295.8	$	28.4	$	13.2	$	337.4
Provisions	947.5		13.3		29.2		990.0
Provision for Medicaid lawsuit (Note 12) (1)	534.4		—		—		534.4
Payments or credits	(982.0)		(15.4)		(31.7)		(1,029.1)
Balance as of June 26, 2020	$	795.7	$	26.3	$	10.7	$	832.7
Balance as of December 25, 2020	$	196.5	$	26.6	$	12.3	$	235.4
Provisions	1,059.3		14.4		28.3		1,102.0
Payments or credits	(987.1)		(19.5)		(28.6)		(1,035.2)
Balance as of June 25, 2021	$	268.7	$	21.5	$	12.0	$	302.2

(1)Excludes the $105.3 million that is reflected as a component of operating expenses as it represents a pre-acquisition contingency related to the portion of the liability that arose from sales of Acthar Gel prior to the Company's acquisition of Questcor Pharmaceuticals Inc. ("Questcor") in August 2014. See Note 12 for further detail on the status of the Medicaid lawsuit.

Product sales transferred to customers at a point in time and over time were as follows:

	Three Months Ended				Six Months Ended
	June 25, 2021		June 26, 2020		June 25, 2021		June 26, 2020
Product sales transferred at a point in time	80.3	%	77.7	%	78.0	%	78.1	%
Product sales transferred over time	19.7		22.3		22.0		21.9

Transaction price allocated to the remaining performance obligations

The following table includes estimated revenue from contracts extending greater than one year for certain of the Company's hospital products that are expected to be recognized in the future related to performance obligations that were unsatisfied or partially unsatisfied as of June 25, 2021:

Remainder of Fiscal 2021	$	66.2
Fiscal 2022	90.3
Fiscal 2023	48.6
Thereafter	6.5

Costs to fulfill a contract

As of June 25, 2021 and December 25, 2020, the total net book value of the devices used in the Company's portfolio of drug-device combination products, which are used in satisfying future performance obligations, were $26.8 million and $25.8 million, respectively, and were classified in property, plant and equipment, net, on the unaudited condensed consolidated balance sheets. The associated depreciation expense recognized during the six months ended June 25, 2021 and June 26, 2020 was $2.9 million and $2.7 million, respectively.

Product Royalty Revenues

The Company licenses certain rights to Amitiza® (lubiprostone) ("Amitiza") to a third party in exchange for royalties on net sales of the product. The royalty rates consist of several tiers ranging from 18.0% to 26.0% with the royalty rate resetting every year. Additionally, beginning in fiscal 2021, Par Pharmaceutical, Inc., et al. (collectively Par) will pay the Company a double-digit royalty based on a percentage of the gross profits of the licensed products sold during the term of the agreement. Under both agreements, the Company recognizes such royalty revenue as the related sales occur. The associated royalty revenue recognized was as follows:

	Three Months Ended				Six Months Ended
	June 25, 2021		June 26, 2020		June 25, 2021		June 26, 2020
Royalty revenue	$	19.5	$	16.3	$	54.9	$	31.9