Segment Data

6 Months Ended

Jul. 01, 2022

Segment Reporting [Abstract]

Segment Data

15. 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 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 and separation costs. Although these amounts are excluded from segment operating income, as applicable, they are included in reported consolidated operating loss and are reflected in the reconciliations presented below.

Selected information by reportable segment was as follows:

	Successor		Predecessor
	Period from June 17, 2022 through July 1, 2022		Period from April 2, 2022  through June 16, 2022		Three Months Ended June 25, 2021
Net sales:
Specialty Brands	$	58.2	$	247.7	$	381.5
Specialty Generics	26.8		136.0		164.9
Net sales	$	85.0	$	383.7	$	546.4
Operating income (loss):
Specialty Brands	$	4.5	$	102.4	$	186.6
Specialty Generics (1)	0.3		30.9		26.9
Segment operating income	4.8		133.3		213.5
Unallocated amounts:
Corporate and unallocated expenses (2)	(0.9)		(15.4)		(25.7)
Depreciation and amortization	(48.4)		(144.6)		(168.1)
Share-based compensation	—		(0.5)		(2.4)
Restructuring charges, net	(1.1)		(2.8)		(6.1)
Separation costs (3)	(9.2)		(7.0)		(0.3)
Operating (loss) income	$	(54.8)	$	(37.0)	$	10.9

(1)Includes $2.4 million of fresh-start inventory-related expense during the period from June 17, 2022 through July 1, 2022 resulting from the Company's change in accounting estimate as disclosed in Note 1.

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

(3)Represents costs included in selling, general and administrative expenses, primarily related to expenses incurred related to the Predecessor directors and officers' policy and severance for the former CEO of the Predecessor, in addition to professional fees and costs incurred as the Company explores potential sales of non-core assets to enable further deleveraging post-emergence.

	Successor		Predecessor
	Period from June 17, 2022 through July 1, 2022		Period from January 1, 2022  through June 16, 2022		Six Months Ended June 25, 2021
Net sales:
Specialty Brands	$	58.2	$	587.1	$	789.9
Specialty Generics	26.8		287.5		314.5
Net sales	$	85.0	$	874.6	$	1,104.4
Operating income (loss):
Specialty Brands	$	4.5	$	267.2	$	398.7
Specialty Generics (1)	0.3		65.3		58.6
Segment operating income	4.8		332.5		457.3
Unallocated amounts:
Corporate and unallocated expenses (2)	(0.9)		(48.2)		(48.3)
Depreciation and amortization	(48.4)		(321.8)		(337.7)
Share-based compensation	—		(1.7)		(6.0)
Restructuring charges, net	(1.1)		(9.6)		(6.5)
Non-restructuring impairment charges	—		—		(64.5)
Separation costs (3)	(9.2)		(9.0)		(0.9)
Operating loss	$	(54.8)	$	(57.8)	$	(6.6)

(1)Includes $2.4 million of fresh-start inventory-related expense during the period from June 17, 2022 through July 1, 2022 resulting from the Company's change in accounting estimate as disclosed in Note 1.

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

(3)Represents costs included in selling, general and administrative expenses, primarily related to expenses incurred related to the Predecessor directors and officers' policy and severance for the former CEO of the Predecessor, in addition to professional fees and costs incurred as the Company explores potential sales of non-core assets to enable further deleveraging post-emergence.

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

	Successor		Predecessor
	Period from June 17, 2022 through July 1, 2022		Period from April 2, 2022  through June 16, 2022		Three Months Ended June 25, 2021
Acthar Gel	$	27.5	$	94.2	$	151.5
INOmax	13.5		66.8		105.9
Ofirmev	(0.2)		(0.1)		6.5
Therakos	10.2		49.7		68.5
Amitiza (1)	5.8		33.8		44.8
Other	1.4		3.3		4.3
Specialty Brands	58.2		247.7		381.5
Opioids	8.7		38.8		53.8
ADHD	1.8		6.8		7.8
Addiction treatment	2.5		14.1		16.0
Other	0.1		2.0		3.6
Generics	13.1		61.7		81.2
Controlled substances	1.7		17.2		25.6
APAP	11.3		50.2		51.7
Other	0.7		6.9		6.4
API	13.7		74.3		83.7
Specialty Generics	26.8		136.0		164.9
Net sales	$	85.0	$	383.7	$	546.4

(1)Amitiza consists of both product net sales and royalties. Refer to Note 4 for further details on Amitiza's revenues.

	Successor		Predecessor
	Period from June 17, 2022 through July 1, 2022		Period from January 1, 2022  through June 16, 2022		Six Months Ended June 25, 2021
Acthar Gel	$	27.5	$	221.9	$	280.5
INOmax	13.5		165.8		239.9
Ofirmev	(0.2)		2.5		19.3
Therakos	10.2		109.6		135.3
Amitiza (1)	5.8		81.5		106.2
Other	1.4		5.8		8.7
Specialty Brands	58.2		587.1		789.9
Opioids	8.7		88.8		108.5
ADHD	1.8		17.5		16.1
Addiction treatment	2.5		30.0		32.4
Other	0.1		4.9		5.5
Generics	13.1		141.2		162.5
Controlled substances	1.7		37.6		43.0
APAP	11.3		96.5		97.2
Other	0.7		12.2		11.8
API	13.7		146.3		152.0
Specialty Generics	26.8		287.5		314.5
Net sales	$	85.0	$	874.6	$	1,104.4

(1)Amitiza consists of both product net sales and royalties. Refer to Note 4 for further details on Amitiza's revenues.