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Amneal Reports Fourth Quarter and Full Year 2019 Financial Results

Amneal Pharmaceuticals, Inc. (NYSE: AMRX) (the “Company”) announced its results today for the fourth quarter and full year ended December 31, 2019.

Net revenue in the fourth quarter of 2019 was $397 million, a decrease of 20% compared to $498 million in the fourth quarter of 2018, primarily due to lower Generics business revenue. Net loss attributable to Amneal Pharmaceuticals, Inc. was $32 million in the fourth quarter of 2019 compared to a net loss of $9 million in the prior year period, due to lower revenue and lower gross margins partially offset by a decline in restructuring and intangible impairment charges. Diluted EPS in the fourth quarter of 2019 was a loss of $0.23 compared to a loss of $0.07 in the prior year period.

Adjusted net income(1) in the fourth quarter of 2019 was $23 million, a decrease of 77% compared to the prior year period. Adjusted EBITDA(1) in the fourth quarter of 2019 was $81 million, a decrease of 57% compared to the prior year period, due to lower revenue and lower gross margins, partially offset by lower operating expenses as a result of cost savings initiatives. Adjusted diluted EPS in the fourth quarter of 2019 was $0.08, compared to $0.33 for the prior year period.

“Since our return as Co-CEOs last August, we have made significant progress reinvigorating our business and taking the necessary actions to support growth in 2020 and beyond,” said Chirag and Chintu Patel, Co-Chief Executive Officers. “2019 was a transition year, but we entered 2020 with strong momentum driven by our team’s relentless focus on execution and addressing inefficiencies across the business. Our execution was highlighted by 30 new awards across our base Generics portfolio and 15 new product launches since August, including two key complex first-to-market launches. Our Specialty business drove impressive growth for our key marketed products, we continued work to expand our pipeline and launched an aggressive strategy to identify near-term opportunities to grow our franchises. We also delivered on our promise to diversify our business with the AvKARE transaction - enhancing our government distribution business and unit dose capabilities - and broadening our geographic reach with our license and supply agreement with Fosun Pharma to supply products for the growing Chinese market. These achievements are helping to propel our 2020 focus and we are confident Amneal is well-positioned to drive long-term growth and value for all our stakeholders in 2020 and beyond.”

(1) See “Non-GAAP Financial Measures” below.

2020 Financial Outlook

Amneal’s full year 2020 estimates, which include the impact of our January 31, 2020 transaction with AvKARE, Inc. and its related affiliate doing business as R&S Northeast LLC, are based on management's current expectations, including with respect to prescription trends, pricing levels, inventory levels, the costs incurred and benefits realized of restructuring activities and the anticipated timing of future product launches and events. The Company cannot provide a reconciliation between non-GAAP projections and the most directly comparable GAAP measures without unreasonable efforts because it is unable to predict with reasonable certainty the ultimate outcome of certain significant items required for the reconciliation. The items include, but are not limited to, acquisition-related expenses, restructuring expenses and benefits, asset impairments and other gains and losses. These items are uncertain, depend on various factors, and could have a material impact on U.S. GAAP reported results for 2020.

Full Year 2020 Financial Guidance

Net revenue

$1,875 million - $1,975 million

Adjusted gross margin

44% - 46%

Adjusted EBITDA (14)

$400 million - $450 million

Adjusted diluted EPS (15)

$0.45 - $0.60

Operating cash flow

$150 million - $200 million

Capital expenditures

$60 million - $70 million

Weighted average diluted shares outstanding (16)

Approximately 300 million

(14)

Includes 100% of EBITDA from the AvKARE and R&S Northeast transaction.

(15)

Accounts for 35% non-controlling interest in AvKARE and R&S Northeast.

(16)

Assumes the weighted average diluted shares outstanding of Class A and Class B shares under the if-converted method.

Conference Call Information

Amneal will hold a conference call on February 26, 2020 at 8:30 a.m. Eastern Time to discuss its results. The call and presentation can also be accessed via a live Webcast through the Investors section of Amneal’s Web site at https://investors.amneal.com/investor-relations, or directly at https://event.on24.com/wcc/r/2151439/4C4EB837C71C6C5471232024C3FDFD00. The number to call from within the United States is (844) 746-0741 and (412) 317-5273 internationally. A replay of the conference call will be available shortly after the call for a period of seven days. To access the replay, dial (877) 344-7529 (in the U.S.) and (412) 317-0088 (international callers). The access code for the replay is 10138831.

 

Amneal Pharmaceuticals, Inc.

Consolidated Statements of Operations

(Unaudited; In thousands, except per share amounts)

Three Months Ended

Years Ended

December 31,

December 31,

2019

2018

2019

2018

Net revenue

$

397,328

$

497,528

$

1,626,373

$

1,662,991

Cost of goods sold

273,373

304,120

1,147,214

938,773

Cost of goods sold impairment charges

13,721

126,162

7,815

Gross profit

110,234

193,408

352,997

716,403

Selling, general and administrative

74,084

71,236

289,598

227,846

Research and development

48,050

57,297

188,049

194,190

In-process research and development impairment charges

450

38,609

46,619

39,259

Acquisition, transaction-related and integration expenses

3,706

4,945

16,388

221,818

Restructuring and other charges

4,412

14,104

34,345

56,413

(Gains) charges related to legal matters, net

(2,308

)

(19,300

)

12,442

(19,711

)

Intellectual property legal development expenses

4,975

3,237

14,238

16,261

Operating (loss) income

(23,135

)

23,280

(248,682

)

(19,673

)

Other (expense) income:

Interest expense, net

(38,829

)

(42,880

)

(168,205

)

(143,571

)

Foreign exchange gain (loss)

4,722

2,817

(4,962

)

(19,701

)

Loss on extinguishment of debt

(19,667

)

Gain (loss) on sale of international businesses

328

(146

)

7,258

(2,958

)

Gain from reduction of tax receivable agreement liability

1,665

192,884

1,665

Other (expense) income

(197

)

458

1,465

1,183

Total other (expense) income, net

(33,976

)

(38,086

)

28,440

(183,049

)

Loss before income taxes

(57,111

)

(14,806

)

(220,242

)

(202,722

)

Provision for (benefit from) income taxes

7,792

5,524

383,331

(1,419

)

Net loss

(64,903

)

(20,330

)

(603,573

)

(201,303

)

Less: Net loss attributable to Amneal Pharmaceuticals LLC pre-Combination

148,806

Less: Net loss attributable to non-controlling interests

32,775

11,562

241,656

32,753

Net loss attributable to Amneal Pharmaceuticals, Inc. before accretion of
redeemable non-controlling interest

(32,128

)

(8,768

)

(361,917

)

(19,744

)

Accretion of redeemable non-controlling interest

(1,176

)

Net loss attributable to Amneal Pharmaceuticals, Inc.

$

(32,128

)

$

(8,768

)

$

(361,917

)

$

(20,920

)

Net loss per share attributable to Amneal Pharmaceuticals, Inc.'s common stockholders:

Class A and Class B-1 basic and diluted

$

(0.23

)

$

(0.07

)

$

(2.74

)

$

(0.16

)

Weighted-average common shares outstanding:

Class A and Class B-1 basic and diluted

141,853

127,343

132,106

127,252

Amneal Pharmaceuticals, Inc.

Condensed Consolidated Balance Sheets

(Unaudited; In thousands)

December 31, 2019

December 31, 2018

Assets

Current assets:

Cash and cash equivalents

$

151,197

$

213,394

Restricted cash

1,625

5,385

Trade accounts receivable, net

604,390

481,495

Inventories

381,067

457,219

Prepaid expenses and other current assets

70,164

128,321

Related party receivables

1,767

830

Total current assets

1,210,210

1,286,644

Property, plant and equipment, net

477,997

544,146

Goodwill

419,504

426,226

Intangible assets, net

1,382,753

1,654,969

Deferred tax asset, net

373,159

Operating lease right-of-use assets

53,344

Operating lease right-of-use assets - related party

16,528

Financing lease right-of-use assets - related party

61,284

Other assets

44,270

67,592

Total assets

$

3,665,890

$

4,352,736

Liabilities and Stockholders' Equity

Current liabilities:

Accounts payable and accrued expenses

$

507,483

$

514,440

Current portion of long-term debt, net

21,479

21,449

Current portion of operating lease liabilities

11,874

Current portion of operating and financing lease liabilities - related party

3,601

Current portion of financing obligation - related party

266

Related party payables

5,969

17,695

Total current liabilities

550,406

553,850

Long-term debt, net

2,609,046

2,630,598

Financing obligations - related party

39,083

Deferred income taxes

1,178

Liabilities under tax receivable agreement

192,884

Operating lease liabilities

43,135

Operating lease liabilities - related party

15,469

Financing lease liabilities - related party

61,463

Other long-term liabilities

39,583

38,780

Total long-term liabilities

2,768,696

2,902,523

Total stockholders' equity

346,788

896,363

Total liabilities and stockholders' equity

$

3,665,890

$

4,352,736

Amneal Pharmaceuticals, Inc.

Consolidated Statements of Cash Flows

(Unaudited; In thousands)

Twelve Months Ended December 31,

2019

2018

Cash flows from operating activities:

Net loss

$

(603,573

)

$

(201,303

)

Adjustments to reconcile net loss to net cash provided by operating activities:

Gain from reduction of tax receivable agreement liability

(192,884

)

(1,665

)

Depreciation and amortization

207,235

137,403

Amortization of Levothyroxine Transition Agreement asset

36,393

10,423

Unrealized foreign currency loss

7,342

18,582

Amortization of debt issuance costs

6,478

5,859

Loss on extinguishment of debt

19,667

(Gain) loss on sale of international businesses, net

(7,258

)

2,958

Intangible asset impairment charges

172,781

47,074

Non-cash restructuring and asset-related charges

12,459

11,295

Deferred tax provision (benefit)

371,716

(9,439

)

Stock-based compensation and PPU expense

21,679

167,597

Inventory provision

82,245

44,539

Other operating charges and credits, net

7,309

(1,866

)

Changes in assets and liabilities:

Trade accounts receivable, net

(132,726

)

89,084

Inventories

(20,393

)

(42,021

)

Prepaid expenses, other current assets and other assets

38,870

8,775

Related party receivables

(939

)

10,928

Accounts payable, accrued expenses and other liabilities

(10,257

)

(53,547

)

Related party payables

5,228

(14,113

)

Net cash provided by operating activities

1,705

250,230

Cash flows from investing activities:

Purchases of property, plant and equipment

(47,181

)

(83,088

)

Acquisition of product rights and licenses

(50,250

)

(14,000

)

Acquisitions, net of cash acquired

(324,634

)

Proceeds from surrender of corporate owned life insurance

43,017

Proceeds from sales of property, plant and equipment

25,344

Proceeds from sale of international businesses, net of cash sold

34,834

Net cash used in investing activities

(19,580

)

(396,378

)

Cash flows from financing activities:

Payments of deferred financing costs and debt extinguishment costs

(54,955

)

Proceeds from issuance of debt

1,325,383

Payments of principal on debt and capital leases

(27,000

)

(617,051

)

Net payments on revolving credit line

(75,000

)

Payments of principal on financing obligation - related party

(243

)

Proceeds from exercise of stock options

1,400

3,797

Employee payroll tax withholding on restricted stock unit vesting

(926

)

Equity contributions

27,742

Capital contribution from non-controlling interest

360

Acquisition of redeemable non-controlling interest

(11,775

)

Acquisition of non-controlling interest

(3,543

)

Tax distribution to non-controlling interest

(13,494

)

(35,543

)

Distributions to members

(182,998

)

Payments of principal on financing lease - related party

(2,270

)

Repayment of related party notes

(92,042

)

Net cash (used in) provided by financing activities

(45,833

)

287,675

Effect of foreign exchange rate on cash

(2,249

)

(670

)

Net (decrease) increase in cash, cash equivalents, and restricted cash

(65,957

)

140,857

Cash, cash equivalents, and restricted cash - beginning of period

218,779

77,922

Cash, cash equivalents, and restricted cash - end of period

$

152,822

$

218,779

Cash and cash equivalents - end of period

$

151,197

$

213,394

Restricted cash - end of period

1,625

5,385

Cash, cash equivalents, and restricted cash - end of period

$

152,822

$

218,779

Amneal Pharmaceuticals, Inc.

Generics Operating Results

(Unaudited; In thousands)

Generics

Three Months Ended December 31,

2019

2018

Net revenue - Generics

$

300,281

$

410,897

Cost of goods sold

224,708

263,002

Cost of goods sold impairment charges

13,721

Gross profit

61,852

147,895

Selling, general, and administrative

16,100

16,572

Research and development

42,281

53,650

In-process research and development impairment charges

450

38,609

Restructuring and other charges

2,900

12,031

Gains related to legal matters, net

(2,308

)

(19,300

)

Intellectual property legal development expenses

4,975

3,263

Acquisition, integration and transaction related expenses

547

Operating (loss) income

$

(3,093

)

$

43,070

Gross margin

20.6

%

36.0

%

Adjusted gross profit (Non-GAAP) (2)

$

99,770

$

185,268

Adjusted gross margin (Non-GAAP) (3)

33.2

%

45.1

%

Adjusted operating income (Non-GAAP)

$

48,740

$

150,166

(1)

 

See “Non-GAAP Financial Measures” below.

(2)

 

Adjusted gross profit is calculated as net revenue less adjusted cost of goods sold. See Non-GAAP reconciliations below for calculation of adjusted cost of goods sold.

(3)

 

Adjusted gross margin is calculated as adjusted gross profit divided by net revenue. See “Non-GAAP Financial Measures” below.

Amneal Pharmaceuticals, Inc.

Reconciliation of Generics Operating (Loss) Income to Generics Combined Operating (Loss) Income

(Unaudited; In thousands)

Generics

Year Ended December 31, 2019

Year Ended December 31, 2018

Add:

(Non-GAAP)

Add:

(Non-GAAP)

Actual

Impax/ Gemini

Combined

Actual

Impax/ Gemini

Combined

Net revenue - Generics

$

1,308,843

$

$

1,308,843

$

1,439,031

$

102,237

$

1,541,268

Cost of goods sold

984,782

984,782

835,181

122,761

957,942

Cost of goods sold impairment charges

119,145

119,145

7,815

7,815

Gross profit

204,916

204,916

596,035

(20,524

)

575,511

Selling, general, and administrative

68,883

68,883

68,426

7,334

75,760

Research and development

172,196

172,196

183,412

13,623

197,035

In-process research and development impairment charges

46,619

46,619

39,259

39,259

Restructuring and other charges

20,101

20,101

33,943

33,943

Charges (gains) related to legal matters, net

12,442

12,442

(22,300

)

89,159

66,859

Intellectual property legal development expenses

13,193

13,193

15,772

23

15,795

Acquisition, integration and transaction related expenses

4,633

4,633

114,622

114,622

Operating (loss) income

$

(133,151

)

$

$

(133,151

)

$

162,901

$

(130,663

)

$

32,238

Gross margin

15.7

%

%

15.7

%

41.4

%

(20.1

)%

37.3

%

Adjusted gross profit (Non-GAAP) (2)

$

464,270

$

$

464,270

$

712,839

$

3,246

$

716,085

Adjusted gross margin (Non-GAAP) (3)

35.5

%

%

35.5

%

49.5

%

3.2

%

46.5

%

Adjusted operating income (Non-GAAP)

$

250,000

$

$

250,000

$

489,740

$

(16,752

)

$

472,988

(1) 

See “Non-GAAP Financial Measures” below.

(2)

 

Adjusted gross profit is calculated as net revenue less adjusted cost of goods sold or combined net revenue less adjusted combined cost of goods sold, as applicable. See Non-GAAP reconciliations below for calculation of adjusted cost of goods sold.

(3)

 

Adjusted gross margin is calculated as adjusted gross profit divided by net revenue or adjusted combined gross profit divided by combined net revenue, as applicable. See “Non-GAAP Financial Measures” below.

Generics net revenue was $300 million in the fourth quarter of 2019 compared to $411 million for the prior year period. The decrease is primarily attributable to price erosion due to additional competition on our existing portfolio, the reclassification of Oxymorphone HCI to the Specialty segment in the third quarter of 2019 and the divestiture of international businesses in the U.K. and Germany. The decrease was partially offset by new product launches in 2019, which included EluRyng (Generic NuvaRing) and Sucralfate.

Generics gross margin for the fourth quarter of 2019 was 21% compared to 36% for the prior year period. The decrease is primarily related to impairment and inventory obsolescence charges, and the impact of price erosion. Generics adjusted gross margin(1) for the fourth quarter of 2019 was 33% compared to 45% for the prior year period primarily due to price erosion, product sales mix, an increase in inventory obsolescence charges and the impact of volume declines period over period leading to underutilization of manufacturing facilities.

Generics operating loss for the fourth quarter of 2019 was $3 million compared to operating income of $43 million for the prior year period. The decrease is primarily due to lower revenue and gross profit as noted above, and an increase in impairment charges. Generics adjusted operating income(1) for the fourth quarter of 2019 was $49 million compared to $150 million for the prior year period primarily due to lower revenue and lower gross profit, partially offset by lower operating expenses as a result of cost savings initiatives.

 

Amneal Pharmaceuticals, Inc.

Specialty Operating Results

(Unaudited; In thousands)

Specialty

Three Months Ended December 31,

2019

2018

Net revenue - Specialty:

Rytary®

$

39,235

$

42,680

Unithroid®

12,309

10,758

Zomig®

15,458

18,308

All other specialty products

30,045

14,885

Total net revenue - Specialty

97,047

86,631

Cost of goods sold

48,665

41,118

Gross profit

48,382

45,513

Selling, general, and administrative

21,960

16,200

Research and development

5,769

3,647

Intellectual property legal development expenses

(26

)

Restructuring and other charges

1,682

Acquisition, integration and transaction related expenses

2,641

Operating income

$

18,012

$

24,010

Gross margin

49.9

%

52.5

%

Adjusted gross profit (Non-GAAP) (2)

$

73,077

$

70,058

Adjusted gross margin (Non-GAAP) (3)

75.3

%

80.9

%

Adjusted operating income (Non-GAAP)

$

45,880

$

50,600

(1)

See “Non-GAAP Financial Measures” below.

(2)

Adjusted gross profit is calculated as net revenue less adjusted cost of goods sold. See Non-GAAP reconciliations below for calculation of adjusted cost of goods sold.

(3)

Adjusted gross margin is calculated as adjusted gross profit divided by net revenue. See “Non-GAAP Financial Measures” below.

Amneal Pharmaceuticals, Inc.

Reconciliation of Specialty Operating Income to Specialty Combined Operating Income

(Unaudited; In thousands)

Specialty

Year Ended December 31, 2019

Year Ended December 31, 2018

Add:

(Non-GAAP)

Add:

(Non-GAAP)

Actual

Impax/ Gemini

Combined

Actual

Impax/ Gemini

Combined

Net revenue - Specialty:

Rytary®

$

134,773

$

$

134,773

$

95,541

$

35,086

$

130,627

Unithroid®

41,089

41,089

23,011

9,716

32,727

Zomig®

54,980

54,980

43,111

14,411

57,522

All other specialty products

86,688

86,688

62,297

37,032

99,329

Total net revenue - Specialty

317,530

317,530

223,960

96,245

320,205

Cost of goods sold

162,432

162,432

103,592

26,731

130,323

Cost of goods sold impairment charges

7,017

7,017

Gross profit

148,081

148,081

120,368

69,514

189,882

Selling, general, and administrative

79,665

79,665

49,465

27,942

77,407

Research and development

15,853

15,853

10,778

3,664

14,442

Intellectual property legal development expenses

1,045

1,045

489

489

Restructuring and other charges

391

391

4,076

4,076

Charges related to legal matters, net

940

940

Acquisition, integration and transaction related expenses

8,346

8,346

Operating income

$

42,781

$

$

42,781

$

55,560

$

36,968

$

92,528

Gross margin

46.6

%

%

46.6

%

53.7

%

72.2

%

59.3

%

Adjusted gross profit (Non-GAAP) (2)

$

247,267

$

$

247,267

$

178,022

$

75,626

$

253,648

Adjusted gross margin (Non-GAAP) (3)

77.9

%

%

77.9

%

79.5

%

78.6

%

79.2

%

Adjusted operating income (Non-GAAP)

$

154,825

$

$

154,825

$

118,127

$

45,144

$

163,271

(1)

 

See “Non-GAAP Financial Measures” below.

(2)

 

Adjusted gross profit is calculated as net revenue less adjusted cost of goods sold or combined net revenue less adjusted combined cost of goods sold, as applicable. See Non-GAAP reconciliations below for calculation of adjusted cost of goods sold.

(3)

 

Adjusted gross margin is calculated as adjusted gross profit divided by net revenue or adjusted combined gross profit divided by combined net revenue, as applicable. See “Non-GAAP Financial Measures” below.

Specialty net revenue was $97 million in the fourth quarter of 2019 compared to $87 million for the prior year period, primarily due to the reclassification of Oxymorphone HCI to the Specialty segment during the third quarter of 2019, and higher revenue from Unithroid®.

Specialty gross margin for the fourth quarter of 2019 was 50% compared to 53% for the prior year period primarily due to product sales mix. Specialty adjusted gross margin(1) for the fourth quarter of 2019 was 75% compared to 81% for the prior year period primarily due to the addition of lower margin Oxymorphone HCI as noted above.

Specialty operating income for the fourth quarter of 2019 was $18 million compared to $24 million for the prior year period, primarily due to higher cost of goods sold and operating expenses. Specialty adjusted operating income(1) for the fourth quarter of 2019 was $46 million compared to $51 million for the prior year period primarily due to the higher cost of goods sold and selling, general and administrative expenses.

 

Corporate and Other Information

(Unaudited; In thousands)

Three Months Ended December 31,

 

2019

 

 

2018

 

General and administrative expense

 $

36,024

 $

38,464

Acquisition, transaction-related and integration expenses

518

4,945

Restructuring and other charges

1,512

391

Total general, administrative and other operating expenses

 $

38,054

 $

43,800

Year Ended December 31, 2019

 

Year Ended December 31, 2018

 

Add:

 

 

(Non-GAAP)

 

 

Add:

 

 

(Non-GAAP)

 

Actual

 

 

Impax/ Gemini

 

 

Combined

 

 

Actual

 

 

Impax/ Gemini

 

 

Combined

 

General and administrative expense

$

141,050

$

$

141,050

$

109,955

 $

28,737

$

138,692

Acquisition, transaction-related and integration expenses

3,409

3,409

107,196

10,925

118,121

Restructuring and other charges

13,853

13,853

18,394

5,123

23,517

Charges related to legal matters, net

2,589

2,589

Total general, administrative and other operating expenses

$

158,312

$

$

158,312

$

238,134

 $

$

44,785

$

282,919

General and administrative and other operating expenses in the fourth quarter of 2019 decreased to $38 million compared to $44 million in the prior year period. The decrease is primarily due to synergies associated with the combination with Impax and the Gemini acquisition including lower acquisition, transaction-related and integration expenses, partially offset by restructuring and other charges relating to recent cost savings initiatives.

About Amneal

Amneal Pharmaceuticals, Inc. (NYSE: AMRX), headquartered in Bridgewater, NJ, is a fully-integrated pharmaceutical company focused on the development, manufacturing and distribution of generic and specialty drug products. The Company has manufacturing operations in North America, Asia, and Europe, working together to bring high-quality medicines to patients primarily within the United States.

Amneal has an extensive portfolio of more than 225 marketed commercial products and is expanding its portfolio to include complex dosage forms, including biosimilars, in a broad range of therapeutic areas. The Company also markets a portfolio of branded pharmaceutical products through its Specialty segment focused principally on central nervous system and endocrine disorders. For more information, visit https://www.amneal.com.

Non-GAAP Financial Measures

This release includes certain non-GAAP financial measures, including adjusted EBITDA, adjusted net income, adjusted net income per diluted share, adjusted gross profit, adjusted gross margin and adjusted operating income, which are intended as supplemental measures of the Company’s performance that are not required by or presented in accordance with GAAP. In addition, this release includes these non-GAAP measures and our reported results on a non-GAAP combined basis to include the historical results of Impax and Gemini, not adjusted for financing and acquisition accounting impacts of the combination with Impax, as if the transaction closing dates had occurred on the first day of all periods presented herein. All combined business results presented in this release are not prepared in accordance with Article 11 of Regulation S-X. The calculation of non-GAAP adjusted diluted earnings per share assumes the conversion of all outstanding shares of Class B Common Stock to shares of Class A Common Stock.

Management uses these non-GAAP historical and combined measures internally to evaluate and manage the Company’s operations and to better understand its business because they facilitate a comparative assessment of the Company's operating performance relative to its performance based on results calculated under GAAP. These non-GAAP measures also isolate the effects of some items that vary from period to period without any correlation to core operating performance and eliminate certain charges that management believes do not reflect the Company's operations and underlying operational performance. The compensation committee of the Company’s board of directors also uses certain of these measures to evaluate management's performance and set its compensation. The Company believes that these non-GAAP measures also provide useful information to investors regarding certain financial and business trends relating to the Company’s financial condition and operating results, and doing so on a combined basis facilitates an evaluation of the financial performance of the Company and its operations on a consistent basis. Providing this information therefore allows investors to make independent assessments of the Company’s financial performance, results of operation and trends while viewing the information through the eyes of management.

These non-GAAP measures are subject to limitations. The non-GAAP measures presented in this release may not be comparable to similarly titled measures used by other companies because other companies may not calculate one or more in the same manner. Additionally, the non-GAAP performance measures exclude significant expenses and income that are required by GAAP to be recorded in the Company’s financial statements; do not reflect changes in, or cash requirements for, working capital needs; and do not reflect interest expense, or the requirements necessary to service interest or principal payments on debt. Further, the combined results may not represent what our combined results of operations and financial position would have been had the transactions occurred on the dates indicated, nor are they intended to project our combined results of operations or financial position for any future period. To compensate for these limitations, management presents and considers these non-GAAP measures in conjunction with the Company’s GAAP results; no non-GAAP measure should be considered in isolation from or as alternatives to net income, diluted earnings per share or any other measure determined in accordance with GAAP. Readers should review the reconciliations included below, and should not rely on any single financial measure to evaluate the Company’s business.

A reconciliation of each non-GAAP measure to the most directly comparable GAAP measure is set forth below.

Safe Harbor Statement

Certain statements contained herein, regarding matters that are not historical facts, may be forward-looking statements (as defined in the Private Securities Litigation Reform Act of 1995). Such forward-looking statements include statements regarding management’s intentions, plans, beliefs, expectations or forecasts for the future, including, among other things, future operating results and financial performance, product development and launches, integration strategies and resulting cost reduction, market position and business strategy. Words such as “may,” “will,” “could,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “assume,” “continue,” and similar words are intended to identify estimates and forward-looking statements.

The reader is cautioned not to rely on these forward-looking statements. These forward-looking statements are based on current expectations of future events. If the underlying assumptions prove inaccurate or known or unknown risks or uncertainties materialize, actual results could vary materially from the expectations and projections of Amneal Pharmaceuticals, Inc. (the “Company”). Such risks and uncertainties include, but are not limited to: the risk that our goodwill may become impaired, which could adversely affect our financial condition and results of operations, our ability to integrate the operations of Amneal Pharmaceuticals LLC and Impax Laboratories, LLC pursuant to the business combination completed on May 4, 2018, and our ability to realize the anticipated synergies and other benefits of the combination with Impax; the impact of global economic conditions; our ability to successfully develop, license, acquire and commercialize new products on a timely basis; our ability to obtain exclusive marketing rights for our products; the competition we face in the pharmaceutical industry from brand and generic drug product companies, and the impact of that competition on our ability to set prices; our ability to manage our growth through acquisitions and otherwise; our dependence on the sales of a limited number of products for a substantial portion of our total revenues; the risk of product liability and other claims against us by consumers and other third parties; risks related to changes in the regulatory environment, including United States federal and state laws related to healthcare fraud abuse and health information privacy and security and changes in such laws; changes to FDA product approval requirements; risks related to federal regulation of arrangements between manufacturers of branded and generic products; the impact of healthcare reform and changes in coverage and reimbursement levels by governmental authorities and other third-party payers; the continuing trend of consolidation of certain customer groups; our reliance on certain licenses to proprietary technologies from time to time; our dependence on third-party suppliers and distributors for raw materials for our products and certain finished goods; our dependence on third-party agreements for a portion of our product offerings; our ability to identify and make acquisitions of or investments in complementary businesses and products on advantageous terms; legal, regulatory and legislative efforts by our brand competitors to deter competition from our generic alternatives; the significant amount of resources we expend on research and development; our substantial amount of indebtedness and our ability to generate sufficient cash to service our indebtedness in the future, and the impact of interest rate fluctuations on such indebtedness; and the high concentration of ownership of our Class A Common Stock and the fact that we are controlled by the Amneal Group. A further list and descriptions of these risks, uncertainties and other factors can be found in the Company’s most recently filed Annual Report on Form 10-K, as supplemented by any subsequently filed Quarterly Reports on Form 10-Q. Copies of these filings are available online at www.sec.gov, www.amneal.com or on request from the Company.

Forward-looking statements included herein speak only as of the date hereof and we undertake no obligation to revise or update such statements to reflect the occurrence of events or circumstances after the date hereof.

 

Amneal Pharmaceuticals, Inc.

Reconciliation of Non-GAAP Combined Results of Operations

(Unaudited; In thousands)

Year Ended December 31, 2019

 

Year Ended December 31, 2018

 

 

 

 

 

Add:

 

 

(Non-GAAP)

 

 

 

 

 

 

Add:

 

 

(Non-GAAP)

 

Actual

 

 

Impax/ Gemini

 

 

Combined

 

 

Actual

 

 

Impax/ Gemini

 

 

Combined

 

Net revenue:

 

Generics

$

1,308,843

$

$

1,308,843

$

1,439,031

$

102,237

$

1,541,268

Specialty

317,530

317,530

223,960

96,245

320,205

Total net revenue

1,626,373

1,626,373

1,662,991

198,482

1,861,473

Cost of goods sold

1,147,214

1,147,214

938,773

149,492

1,088,265

Cost of goods sold impairment charges

126,162

126,162

7,815

7,815

Gross profit

 

352,997

352,997

716,403

48,990

765,393

Selling, general and administrative

289,598

289,598

227,846

64,013

291,859

Research and development

188,049

188,049

194,190

17,287

211,477

In-process research and development impairment charges

46,619

46,619

39,259

39,259

Acquisition, transaction-related and integration expenses

16,388

16,388

221,818

10,925

232,743

Restructuring and other charges

34,345

34,345

56,413

5,123

61,536

Charges (gains) related to legal matters, net

12,442

12,442

(19,711

)

90,099

70,388

Intellectual property legal development expenses

14,238

14,238

16,261

23

16,284

Operating loss

 

(248,682

)

(248,682

)

(19,673

)

(138,480

)

(158,153

)

Other income (expense):

Interest expense, net

(168,205

)

(168,205

)

(143,571

)

(18,231

)

(161,802

)

Foreign exchange (loss) gain, net

(4,962

)

(4,962

)

(19,701

)

921

(18,780

)

Loss on extinguishment of debt

(19,667

)

(19,667

)

Gain (loss) on sale of international businesses

7,258

7,258

(2,958

)

(2,958

)

Gain from reduction of tax receivable agreement liability

192,884

192,884

1,665

1,665

Other income (expense)

1,465

1,465

1,183

(638

)

545

Total other income (expense), net

 

28,440

28,440

(183,049

)

(17,948

)

(200,997

)

Loss before income taxes

(220,242

)

(220,242

)

(202,722

)

(156,428

)

(359,150

)

Provision for (benefit from) income taxes

383,331

383,331

(1,419

)

(6,273

)

(7,692

)

Net loss

 

(603,573

)

(603,573

)

(201,303

)

$

(150,155

)

$

(351,458

)

Less: Net loss attributable to Amneal Pharmaceuticals LLC pre-Combination

148,806

Less: Net loss attributable to non-controlling interests

241,656

241,656

32,753

Accretion of redeemable non-controlling interest

(1,176

)

Net loss attributable to Amneal Pharmaceuticals, Inc.

$

(361,917

)

$

$

(361,917

)

$

(20,920

)

 

Amneal Pharmaceuticals, Inc.

Non-GAAP Reconciliations

(Unaudited; In thousands)

Reconciliations of Cost of Goods Sold to Adjusted Cost of Goods Sold

Generics

 

Three Months Ended December 31,

 

2019

 

2018

 

Cost of goods sold

 

 $

224,708

$

263,002

Cost of goods sold impairment charges

 

13,721

Adjusted to deduct:

Amortization

15,483

10,030

Inventory related charges (5)

3,089

3,620

Acquisition and site closure expenses (6)

4,715

12,384

Asset impairment charges (7)

13,721

510

Stock-based compensation expense

910

406

Amortization of upfront payment (9)

10,423

Adjusted cost of goods sold (Non-GAAP)

 

 $

200,511

$

225,629

Generics

 

Year Ended December 31, 2019

 

Year Ended December 31, 2018

 

 

 

 

 

Add:

 

 

(Non-GAAP)

 

 

 

 

 

 

Add:

 

(Non-GAAP)

 

Actual

 

 

Impax/ Gemini

 

 

Combined

 

 

Actual

 

 

Impax/ Gemini

 

Combined

 

Cost of goods sold

 

$

984,782

$

$

984,782

$

835,181

$

122,761

$

957,942

Cost of goods sold impairment charges

 

119,145

119,145

7,815

7,815

Adjusted to deduct:

Amortization

51,783

51,783

23,940

13,823

37,763

Inventory related charges (5)

22,828

22,828

45,615

9,894

55,509

Acquisition and site closure expenses (6)

25,151

25,151

27,619

27,619

Asset impairment charges (7)

119,145

119,145

8,401

53

8,454

Stock-based compensation expense

3,030

3,030

806

806

Amortization of upfront payment (9)

36,393

36,393

10,423

10,423

Other

1,024

1,024

Adjusted cost of goods sold (Non-GAAP)

 

$

844,573

$

$

844,573

$

726,192

$

98,991

$

825,183

Specialty

 

Three Months Ended December 31,

 

2019

 

2018

 

Cost of goods sold

 

 $

48,665

 $

41,118

Adjusted to deduct:

Amortization

24,695

18,848

Inventory related charges (5)

5,697

Adjusted cost of goods sold (Non-GAAP)

 

 $

23,970

 $

16,573

Specialty

 

Year Ended December 31, 2019

 

Year Ended December 31, 2018

 

 

 

 

 

 

 

Add:

 

 

(Non-GAAP)

 

 

 

 

 

 

Add:

 

(Non-GAAP)

 

 

 

Actual

 

 

Impax/ Gemini

 

 

Combined

 

 

Actual

 

 

Impax/ Gemini

 

Combined

 

Cost of goods sold

$

162,432

$

$

162,432

$

103,592

$

26,731

$

130,323

Cost of goods sold impairment charges

7,017

7,017

Adjusted to deduct:

Amortization

92,169

92,169

49,047

6,112

55,159

Asset impairment charges (7)

7,017

7,017

Inventory related charges (5)

8,607

8,607

Adjusted cost of goods sold (Non-GAAP)

$

70,263

$

$

70,263

$

45,938

$

20,619

$

66,557

 

Amneal Pharmaceuticals, Inc.

Non-GAAP Reconciliations

(Unaudited; In thousands)

Reconciliations of Generics Operating (Loss) Income to Adjusted Operating Income

Generics

 

Three Months Ended December 31,

 

 

 

2019

 

2018

 

Operating (loss) income

 $

(3,093

)

 $

43,070

Adjusted to add (deduct):

Acquisition and site closure expenses (6)

6,028

20,905

Amortization

15,483

10,030

Inventory related charges (5)

5,938

3,620

Stock-based compensation expense

2,588

1,926

Asset impairment charges (7)

14,655

39,119

Restructuring and other charges (8)

2,900

12,031

Gains related to legal matters, net (10)

(2,409

)

(97

)

Amortization of upfront payment (9)

10,423

R&D milestone payment

6,650

5,300

Other

3,839

Adjusted operating income (Non-GAAP)

 $

48,740

 $

150,166

 

Generics

 

Year Ended December 31, 2019

 

Year Ended December 31, 2018

 

 

 

 

 

 

 

Add:

 

 

(Non-GAAP)

 

 

 

 

 

 

Add:

 

 

(Non-GAAP)

 

 

 

Actual

 

 

Impax/ Gemini

 

 

Combined

 

 

Actual

 

 

Impax/ Gemini

 

 

Combined

 

Operating (loss) income

$

(133,151

)

$

$

(133,151

)

$

162,901

$

(130,663

)

$

32,238

Adjusted to add (deduct):

Acquisition and site closure expenses (6)

41,639

41,639

150,762

150,762

Amortization

51,783

51,783

23,940

13,823

37,763

Inventory related charges (5)

25,677

25,677

45,615

9,894

55,509

Stock-based compensation expense

11,943

11,943

3,348

982

4,330

Asset impairment charges (7)

166,396

166,396

47,660

53

47,713

Restructuring and other charges (8)

20,101

20,101

33,943

33,943

Charges (gains) related to legal matters, net (10)

12,591

12,591

(97

)

89,159

89,062

Amortization of upfront payment (9)

36,393

36,393

10,423

10,423

R&D milestone payment

16,579

16,579

8,000

8,000

Other

49

49

3,245

3,245

Adjusted operating income (Non-GAAP)

$

250,000

$

$

250,000

$

489,740

$

(16,752

)

$

472,988

 

Amneal Pharmaceuticals, Inc.

Non-GAAP Reconciliations

(Unaudited; In thousands)

Reconciliations of Specialty Operating Income to Adjusted Operating Income

Specialty

 

Three Months Ended December 31,

 

 

 

2019

 

2018

 

Operating income

 $

18,012

 $

24,010

Adjusted to add:

Amortization

24,695

18,848

Inventory related charges (5)

5,697

Acquisition and site closure expenses (6)

2,641

189

Stock-based compensation expense

532

11

Restructuring and other charges (8)

1,682

Other

163

Adjusted operating income (Non-GAAP)

 $

45,880

 $

50,600

 

Specialty

 

Year Ended December 31, 2019

 

Year Ended December 31, 2018

 

 

 

 

 

 

 

Add:

 

 

(Non-GAAP)

 

 

 

 

 

 

Add:

 

 

(Non-GAAP)

 

 

 

Actual

 

 

Impax/ Gemini

 

 

Combined

 

 

Actual

 

 

Impax/ Gemini

 

 

Combined

 

Operating income

$

42,781

$

$

42,781

$

55,560

$

36,968

$

92,528

Adjusted to add:

Amortization

92,169

92,169

49,047

6,112

55,159

Inventory related charges (5)

8,607

8,607

Acquisition and site closure expenses (6)

10,969

10,969

189

189

Stock-based compensation expense

1,498

1,498

11

1,124

1,135

Restructuring and other charges (8)

391

391

4,076

4,076

Charges related to legal matters, net

940

940

Asset impairment charges (7)

7,017

7,017

Other

637

637

Adjusted operating income (Non-GAAP)

$

154,825

$

$

154,825

$

118,127

$

45,144

$

163,271

 

Amneal Pharmaceuticals, Inc.

Non-GAAP Reconciliations

(Unaudited; In thousands, except per share amounts)

Reconciliation of Net Loss to Adjusted Net Income and Calculation of Adjusted Diluted EPS

 

Three Months Ended December 31,

 

 

 

2019

 

 

2018

 

Net loss

$

(64,903

)

$

(20,330

)

Adjusted to add (deduct):

Non-cash interest

1,629

$

1,640

GAAP Income tax expense

7,792

$

5,524

Gain from reduction of tax receivable agreement liability (4)

$

(1,665

)

Amortization

40,178

$

28,878

Stock-based compensation expense

5,013

$

3,606

Acquisition and site closure expenses (6)

14,983

$

28,966

Restructuring and other charges (8)

4,412

$

14,104

Inventory related charges (5)

5,963

$

9,317

Gains related to legal matters, net (10)

(2,409

)

$

(497

)

Asset impairment charges (7)

14,655

$

39,119

Amortization of upfront payment (9)

$

10,423

Foreign exchange gain

(4,722

)

$

(2,817

)

(Gain) loss on sale of international business (11)

(328

)

$

146

R&D milestone payments

6,650

$

5,300

Other

342

$

5,077

Income tax at 21%

(6,138

)

$

(26,626

)

Net income attributable to NCI not associated with our Class B shares

(113

)

(189

)

Adjusted net income (Non-GAAP)

$

23,004

$

99,976

Adjusted diluted EPS (Non-GAAP) (12)

$

0.08

$

0.33

(12)

 

For the three months ended December 31, 2019, utilizes weighted average diluted shares outstanding of 299,298, which consists of Class A shares and Class B shares under the if-converted method. For the three months ended December 31, 2018, utilizes weighted average diluted shares outstanding of 299,345, which consists of Class A shares, Class B and Class B-1 shares under the if-converted method.

 

Amneal Pharmaceuticals, Inc.

Non-GAAP Reconciliations

(Unaudited; In thousands, except per share amounts)

Reconciliation of Net Loss to Combined Adjusted Net Income and Calculation of Adjusted Diluted EPS

 

Year Ended December 31, 2019

 

Year Ended December 31, 2018

 

 

 

 

 

 

 

Add:

 

 

(Non-GAAP)

 

 

 

 

 

 

Add:

 

 

(Non-GAAP)

 

 

 

Actual

 

 

Impax/ Gemini

 

 

Combined

 

 

Actual

 

 

Impax/ Gemini

 

 

Combined

 

Net loss

$

(603,573

)

$

$

(603,573

)

$

(201,303

)

$

(150,155

)

$

(351,458

)

Adjusted to add (deduct):

Non-cash interest

6,478

6,478

8,669

9,413

18,082

Gain from reduction of tax receivable agreement liability (4)

(192,884

)

(192,884

)

(1,665

)

(1,665

)

GAAP Income tax expense (benefit)

383,331

383,331

(1,419

)

(6,273

)

(7,692

)

Amortization

143,952

143,952

72,987

19,935

92,922

Stock-based compensation expense

21,679

21,679

8,840

4,816

13,656

Acquisition and site closure expenses (6)

73,471

73,471

264,424

10,925

275,349

Restructuring and other charges (8)

34,345

34,345

56,413

5,123

61,536

Loss on extinguishment of debt

19,667

19,667

Inventory related charges (5)

25,702

25,702

54,222

9,894

64,116

Charges related to legal matters, net (10)

12,591

12,591

2,092

90,099

92,191

Asset impairment charges (7)

175,210

175,210

47,660

53

47,713

Amortization of upfront payment (9)

36,393

36,393

10,423

10,423

Foreign exchange loss (gain)

4,962

4,962

19,701

(921

)

18,780

(Gain) loss on sale of international businesses, net (11)

(7,258

)

(7,258

)

2,958

2,958

R&D milestone payments

16,579

16,579

8,000

8,000

Other

578

578

5,732

1,953

7,685

Income tax at 21%

(27,621

)

(27,621

)

(79,485

)

1,309

(78,176

)

Net income attributable to NCI not associated with our Class B shares

(344

)

(344

)

(386

)

(386

)

Adjusted net income (Non-GAAP)

$

103,591

$

$

103,591

$

297,530

$

(3,829

)

$

293,701

Adjusted diluted EPS (Non-GAAP) (13)

$

0.35

$

0.98

(13)

 

For the twelve months ended December 31, 2019, utilizes weighted average diluted shares outstanding of 299,194, which consists of Class A shares and Class B shares under the if-converted method. For the twelve months ended December 31, 2018, utilizes weighted average diluted shares outstanding of 299,328, which consists of Class A, Class B and Class B-1 shares under the if-converted method.

 

Amneal Pharmaceuticals, Inc.

Non-GAAP Reconciliations

(Unaudited, In thousands)

Reconciliations of Net Loss to EBITDA and Adjusted EBITDA

 

Three Months Ended December 31,

 

 

 

2019

 

2018

 

Net loss

 $

(64,903

)

 $

(20,330

)

Adjusted to add (deduct):

Interest expense, net

38,829

42,880

Income tax expense

7,792

5,524

Depreciation and amortization

54,303

47,494

EBITDA (Non-GAAP)

 $

36,021

 $

75,568

Adjusted to add (deduct):

Gain from reduction of tax receivable agreement liability (4)

 $

 $

(1,665

)

Stock-based compensation expense

5,013

3,606

Acquisition and site closure expenses (6)

14,983

28,966

Restructuring and other charges (8)

4,412

14,104

Inventory related charges (5)

5,938

9,317

Gains related to legal matters, net (10)

(2,409

)

(497

)

Asset impairment charges (7)

14,655

39,119

Amortization of upfront payment (9)

10,423

Foreign exchange gain

(4,722

)

(2,817

)

(Gain) loss on sale of international businesses (11)

(328

)

146

R&D milestone payments

6,650

5,300

Other

342

5,077

Adjusted EBITDA (Non-GAAP)

 $

80,555

 $

186,647

 

 

Year Ended December 31, 2019

 

Year Ended December 31, 2018

 

 

 

 

 

 

 

Add:

 

 

(Non-GAAP)

 

 

 

 

 

 

Add:

 

 

(Non-GAAP)

 

 

 

Actual

 

 

Impax/ Gemini

 

 

Combined

 

 

Actual

 

 

Impax/ Gemini

 

 

Combined

 

Net loss

$

(603,573

)

$

$

(603,573

)

$

(201,303

)

$

(150,155

)

$

(351,458

)

Adjusted to add (deduct):

Interest expense, net

168,205

168,205

143,571

18,231

161,802

Income tax expense (benefit)

383,331

383,331

(1,419

)

(6,273

)

(7,692

)

Depreciation and amortization

207,235

207,235

137,405

24,900

162,305

EBITDA (Non-GAAP)

$

155,198

$

$

155,198

$

78,254

$

(113,297

)

$

(35,043

)

Adjusted to add (deduct):

Gain from reduction of tax receivable agreement liability (4)

$

(192,884

)

$

$

(192,884

)

$

(1,665

)

$

$

(1,665

)

Stock-based compensation expense

21,679

21,679

8,840

4,816

13,656

Acquisition and site closure expenses (6)

73,471

73,471

264,424

10,925

275,349

Restructuring and other charges (8)

34,345

34,345

56,413

5,123

61,536

Loss on extinguishment of debt

19,667

19,667

Inventory related charges (5)

25,677

25,677

54,222

9,894

64,116

Charges related to legal matters, net (10)

12,591

12,591

2,092

90,099

92,191

Asset impairment charges (7)

175,210

175,210

47,660

53

47,713

Amortization of upfront payment (9)

36,393

36,393

10,423

10,423

Foreign exchange loss (gain)

4,962

4,962

19,701

(921

)

18,780

(Gain) loss on sale of international businesses, net (11)

(7,258

)

(7,258

)

2,958

2,958

R&D milestone payments

16,579

16,579

8,000

8,000

Other

(446

)

(446

)

5,732

653

6,385

Adjusted EBITDA (Non-GAAP)

$

355,517

$

$

355,517

$

576,721

$

7,345

$

584,066

Amneal Pharmaceuticals, Inc.

Non-GAAP Reconciliations

(Unaudited; In thousands)

(4)

 

Gain from reduction of tax receivable agreement liability represents the reversal of the accrued liability associated with the Company’s deferred tax assets created at the Impax combination.

(5)

 

For the three and twelve months ended December 31, 2019, inventory related charges primarily represent inventory obsolescence resulting from new initiatives and policies adopted with our restructuring efforts. Inventory charges for the three months ended December 31, 2019 also includes a charge to write-down the net realizable value of our ranitidine-based product inventory to zero.  For the three and twelve months ended December 31, 2018, inventory related charges also include a reserve for an unfavorable supply arrangement and the amortization of the Impax inventory step-up to fair value in purchase accounting.

(6)

 

Acquisition and site closure expenses for all periods presented include costs related to (i) plant closure and redundant employee costs and (ii) third party costs associated with the combination of Impax and related integration including legal, investment banking, accounting and information technology. For the three and twelve months ended December 31, 2018, acquisition and site closure expenses also includes costs associated with the Impax sale of its Middlesex, NJ and Taiwan facilities.

(7)

 

Asset impairment charges for the three and twelve months ended December 31, 2019 are primarily associated with the write-off of in process research and development and intangible asset impairment charges primarily related to products acquired in the Impax combination.  Asset impairment charges for the year ended December 31, 2018 are primarily associated with the write-off of leasehold improvements in connection with the closing of our Hayward, CA facility.

(8) 

 

For the twelve months ended December 31, 2019, restructuring and other charges are primarily associated with cash severance provided pursuant to our severance programs for employees at our Hauppauge, NY, Hayward, CA and other facilities as well as asset-related charges associated with the impairment of property, plant and equipment and the right of use asset associated with our Hauppauge, NY facility.  For the three months ended December 31, 2019, restructuring and other charges are primarily associated with cash severance provided pursuant to our severance programs for employees at our Hauppauge, NY facility.  For the three and twelve months ended December 31, 2018, restructuring and other charges includes employee separation costs associated with the consolidation of sites due to the Impax combination of Amneal and Impax, as well as the write-off of property, plant, and equipment at those sites.

(9)

 

Amortization of upfront payment represents the amortization of the upfront payment made to Lannett in connection with our Transition Agreement for Levothyroxine.

(10) 

 

For the year ended December 31, 2019, charges (gains) related to legal matters, net are primarily associated with a settlement agreement with Teva Pharmaceuticals, Inc. regarding a matter associated with Impax prior to the Combination.  Charges (gains) related to legal matters, net for the year ended December 31, 2018 relate to an Impax litigation settlement charge and a settlement for claims with the plaintiffs in the class action antitrust suits related to Solodyn®.   

(11)

 

For the year ended December 31, 2019 gain/loss on the sale of international business, net represents the gain from the sale of our Creo Pharma Holding Limited subsidiary, which comprised substantially all of the Company's operations in the United Kingdom partially offset by the loss from the sale of our Amneal Deutschland GmbH subsidiary, which comprised substantially all of the Company's operations in Germany.  For the year ended December 31, 2018, gain/loss on the sale of international business, net represents adjustments from the 2017 sale of Amneal Pharma Pty Ltd subsidiary, which comprised substantially all of the Company's operations in Australia and from the sale of our Amneal Nordic ApS and Amneal Pharma Spain S.L. subsidiaries, which comprised substantially all of the Company's operations in Spain and Scandinavia.  

Contacts:

Todd Branning
(908) 280-6019

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