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USD ($)

USD ($) / shares

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   &lt;div style="margin-top: 12pt; font-size: 1pt"&gt;&amp;#160;
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       &lt;b&gt;&lt;font style="font-family: 'Times New Roman', Times"&gt;NOTE&amp;#160;1&amp;#160;&amp;#8212;
       Description of Business&lt;/font&gt;&lt;/b&gt;
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       Watson Pharmaceuticals, Inc. (&amp;#8220;Watson&amp;#8221; or the
       &amp;#8220;Company&amp;#8221;) is primarily engaged in the development,
       manufacturing, marketing, sale and distribution of brand and
       generic pharmaceutical products. Watson was incorporated in 1985
       and began operations as a manufacturer and marketer of
       off-patent pharmaceuticals. Through internal product development
       and synergistic acquisitions of products and businesses, the
       Company has grown into a diversified specialty pharmaceutical
       company. Watson operates manufacturing, distribution, research
       and development (&amp;#8220;R&amp;#038;D&amp;#8221;) and administrative
       facilities in the United States of America (&amp;#8220;U.S.&amp;#8221;)
       and, beginning in 2009, in key international markets including
       Western Europe, Canada, Australasia, South America and South
       Africa.
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   &lt;div align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent"&gt;
       &lt;b&gt;&lt;i&gt;&lt;font style="font-family: 'Times New Roman', Times"&gt;Acquisition
       of Arrow Group&lt;/font&gt;&lt;/i&gt;&lt;/b&gt;
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       On December&amp;#160;2, 2009 (the &amp;#8220;Acquisition Date&amp;#8221;),
       Watson completed its acquisition of all the outstanding equity
       of Robin Hood Holdings Limited, a Malta private limited
       liability company, and Cobalt Laboratories, Inc., a Delaware
       corporation (together the &amp;#8220;Arrow Group&amp;#8221;). The Arrow
       Group is principally engaged in the manufacture and distribution
       of generic pharmaceuticals and operates in the U.S.&amp;#160;and
       international markets including Western Europe, Canada,
       Australasia, South America and South Africa.
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       As a result of the acquisition of the Arrow Group, Watson also
       acquired a 36% ownership interest in Eden Biopharm Group Limited
       (&amp;#8220;Eden&amp;#8221;), a company which provides development and
       manufacturing services for early-stage biotech companies. In
       January 2010, we repurchased the remaining interest in Eden for
       $15.0&amp;#160;million. Eden&amp;#8217;s results are included in the
       Global Brands segment. For additional information on the
       acquisition of the Arrow Group, refer to
       &amp;#8220;NOTE&amp;#160;4&amp;#160;&amp;#8212; Acquisitions and
       Divestitures.&amp;#8221;
   &lt;/div&gt;
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