Bausch Health Companies Inc. · TSX:BHC
Bausch Health Companies — Valeant Pharmaceuticals International — 36th Annual J.P. Morgan Healthcare Conference (January 2018)
70 slides from Bausch Health Companies's conference presentation, Jan 9, 2018
Slide 1: Investing to Deliver Growth in Durable Franchises
Investing to Deliver Growth in Durable Franchises 36th Annual J.P. Morgan Healthcare Conference Jan. 10, 2018
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking information and statements, within the meaning of applicable securities laws (collectively, “forward - looking statements”), including, but not limited to, statements regarding Valeant's future prospects and performance, the expec
Slide 3: Non-GAAP Information: Recent Assessment of Financial Performance Measures
Non-GAAP Information Recent Assessment of Financial Performance Measures 2 Recently, the Company’s management team undertook an evaluation of how it would measure the financial performance of the Company going forward. In evaluating its financial performance measures, the Company considered its rece
Slide 4: Non-GAAP financial measures
To supplement the financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), the Company uses certain non-GAAP financial measures including (i) Adjusted EBITDA, (ii) Adjusted EBITA, (iii) Adjusted EBITA Margin, (iv) Adjusted Operating Income, (v) Adjusted Gr
Slide 5: Tangible Progress Toward Transformation
Tangible Progress Toward Transformation O U R M I S S I O N : Improve people’s lives with our health care products. “We have built a world-class organization, and we are well positioned to grow as we continue to transform Valeant.” – Joseph C. Papa, Chairman and CEO 4 STABILIZE 2016 TURNAROUND 2017-
Slide 6: Progress Through 2017
Progress Through 2017 Delivered on Commitments Focused on Core Business • In 3Q17, ~77% of Valeant's total revenue is generated from the Bausch + Lomb/International segment and the Salix business • Bausch + Lomb/International segment (~57% of Valeant’s revenue in 3Q17) generated organic revenue grow
Slide 7: Diversified Portfolio with a Significant International Presence
6 Diversified Portfolio with a Significant International Presence 1. YTD revenue as of 9.30.17 International 40% U.S. 60% Global Footprint1 Total Revenue Breakdown1 Global Consumer 18% Global Vision Care 9% Global Surgical 7% Global Ophtho Rx 7% International 15% Salix 17% All Other 20% Ortho Dermat
Slide 8: Bausch + Lomb/International Organic Growth and Key Products
Global Consumer International Global Vision Care Global Surgical Global Ophtho Rx 31% 27% 16% 13% 13% 7 1. Organic growth, a non-GAAP metric, is defined as an increase on a year-over-year basis in revenues on a constant currency basis (if applicable) excluding the impact of divestitures and disconti
Slide 9: Consumer and Vision Care
Consumer and Vision Care1 1. Reported within the B+ L/International segment. 2. Data Source: IRI: Total U.S. MULO 52WE 11-26-17 3. Source: GfK sales through November 2017 4. Source: IRI Market Advantage – Total US MULO – B+L as of 3Q17 5. Based on Universal Product Codes Bausch + Lomb U.S. Market Sh
Slide 10: Glaucoma Market Opportunity and VYZULTA
9 1. Source: The Glaucoma Drugs Market: Opportunities, Challenges, Strategies & Forecasts, SNS Research; Market Intelligence & Consultancy Solutions, 2016. Glaucoma Market Opportunity1 Global glaucoma market represents ~$6 billion Market is expected to grow at a CAGR of 15% over the next four-ye
Slide 11: Salix: RELISTOR and XIFAXAN Highlights
12 13 14 15 Jan-17 Mar-17 May-17 Jul-17 Sep-17 Nov-17 T hous a nd s Labor Day Holiday Week July 4th Holiday Week 10 1. Reported within Branded Rx segment. 2. Source: Symphony Health Other Promoted Brands YTD Growth in RELISTOR® Franchise2 • Growth across a number of brands, including: RELISTOR® (~
Slide 12: DUOBRII and SILIQ
11 1. Provisional name 2. Rachakonda TD et al. J Am Acad Dermatol. 2014 Mar. Psoriasis prevalence among adults in the United States https://www.ncbi.nlm.nih.gov/pubmed/24388724 3. Cowen. Therapeutic Outlook Dermatology. March 2016 4. IMS Claims Data. April 2015- March 2016, Iqvia. Data on file PDUFA
Slide 13: Dermatology Catalysts
12 1. Provisional name Increase Dermatology Sales Force and Reallocate Towards Psoriasis (>25% increase in sales force) Submitted ALTRENO™1 (IDP-121) for acne to the FDA Submitted JEMDEL™1 (IDP-122) for psoriasis to the FDA RETIN-A MICRO® 06 launching in Jan. 2018 FDA accepted NDA for DUOBRI
Slide 14: Improved Working Capital Efficiency is Contributing to Debt Reduction
13 Improved Working Capital Efficiency is Contributing to Debt Reduction Generated $1,712 million in cash flow from operations for the nine months ending Sept. 30, 2017. In the third quarter, generated cash flow from operations of $490 million From Sept. 30, 2016 to Sept. 30, 2017, reduced working c
Slide 15: Reduced Debt and Extended Maturities
$- $5 $10 $15 $20 $25 $30 $35 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 & Beyond C u m u lat iv e d eb t re p aym en t sc h ed u le (i n b ill io n s) Mar. 31, 2016 Dec. 31, 2017 Reduced Debt and Extended Maturities 1. Debt values are shown at principal value. 2. Reflects the paydown of $923
Slide 16: Delivering on Commitment to Simplify Operating Model and Reduce Debt
15 Delivering on Commitment to Simplify Operating Model and Reduce Debt Divestiture Date Closed Sprout Dec. 20, 2017 Obagi Nov. 9, 2017 iNova Sept. 29, 2017 Dendreon June 28, 2017 Armoxindo (Indonesia) May 17, 2017 Delta (Brazil) April 20, 2017 Skin Care Brands (CeraVe®, AcneFree™ and AMBI®) March 3
Slide 17: Making Progress in Innovation
Stellaris Elite™ next generation surgical platform – H1 2017 Bausch + Lomb ULTRA® for Astigmatism contact lenses and Biotrue® ONEday for Astigmatism daily disposables – H1 2017 SILIQ™ – 3Q17 Vitesse™ vitreous cutter – 4Q17 Thermage™ FLX System – 4Q17 VYZULTA™ – Dec. 2017 LUMIFY™ – 2Q18 16 Making Pro
Slide 18: Seven New Product Approvals Will Drive Long-Term Growth
17 Significant Seven New Product Approvals Will Drive Long-Term Growth1 +$1B in expected annualized revenues of selected products at peak sales over the next five years <$100M in annualized revenues today Daily 1. Investigational products subject to FDA approval 1 1
Slide 19: Catalysts: 2018 and Beyond
18 1. Provisional name Catalysts: 2018 and Beyond Bausch + Lomb VYZULTA™ Launch (now) Stellaris Elite™ Launch (now) LUMIFY™ (formerly Luminesse) Launch (2Q18) SiHy Daily Launch (4Q18) Crystalsert® 2.6 Injector 510(k) Approval (1H18) ULTRA® Toric / Multi-Focal Launch (1Q19) Consumer E-c
Slide 20: Financials previously disclosed in 3Q17 results
Financials that follow were all previously disclosed in 3Q17 results on Nov. 7, 2017
Slide 21: Global Consumer and International Key Products
Global Consumer 20 Bausch + Lomb/International Segment – Key Products Product Description PreserVision® A brand of eye vitamins for those diagnosed with moderate-to-advanced age-related macular degeneration renu® Multi-Purpose Solutions Multi-Purpose solutions that clean and disinfect soft contact l
Slide 22: Bausch + Lomb/International Key Products: Surgical and Vision Care
21 Bausch + Lomb/International Segment – Key Products Product Description Stellaris Elite™ Next-generation phacoemulsification and vitrectomy platform Stellaris® Cataract and Retina Consumables Stellaris disposable packs and accessories for cataract surgery and retina surgery enVista® IOL Hydrophobi
Slide 23: Bausch + Lomb/International Key Products: Ophtho Rx
22 Bausch + Lomb/International Segment – Key Products Product Description LOTEMAX® Gel Indicated for treatment of inflammation and pain following eye surgery PROLENSA® A nonsteroidal anti-inflammatory agent indicated to treat inflammation and reduce eye pain in patients after cataract surgery ALREX®
Slide 24: Branded Rx Key Products: Salix and Ortho Dermatologics
23 Branded Rx Segment – Key Products Product Description XIFAXAN® Tablets used to treat traveler’s diarrhea, irritable bowel syndrome with diarrhea (IBS-D) and for the reduction in risk of overt hepatic encephalopathy (HE) recurrence RELISTOR® Tablets or injections to treat constipation caused by op
Slide 25: Branded Rx Key Products: Dentistry
24 Branded Rx Segment – Key Products Product Description ARESTIN® Concentrated, locally applied antibiotic that remains active for an extended period of time for the reduction of pocket depth NeutraSal® A prescription rinse that helps perform important functions of saliva when suffering from oral mu
Slide 26: U.S. Diversified Products Key Products
25 U.S. Diversified Products Segment – Key Products Product Description WELLBUTRIN® Extended-release tablet used to treat adults with a certain type of depression called major depressive disorder, and for the prevention of autumn-winter seasonal depression XENAZINE® US Tablet used to treat the invol
Slide 27: U.S. Diversified Products Key Products: Solta
26 U.S. Diversified Products Segment – Key Products Product Description Thermage® Designated for use on different parts of the body to help with skin smoothing Fraxel® Non-invasive laser therapy providing a wide array of treatment options to address many forms of aging Clear + Brilliant® Laser skin
Slide 28: Key Product LOE / Divestiture 2017 Impact – Forecast
Key Product LOE / Divestiture 2017 Impact – Forecast Business Unit Product Line with Actual or Anticipated LOE/Divestiture Date1 LOE/Divested Rev/Profit Prior Estimate (August) LOE/Divested Rev/Profit Current Estimate Current vs Prior Estimate Favorable/(Unfavorable) Revenue Profit Revenue Profit Re
Slide 29: Key Product LOE / Divestiture 2017 Impact – Y/Y
Key Product LOE / Divestiture 2017 Impact – Y/Y Business Unit Product Line with Actual or Anticipated LOE/Divestiture Date1 LOE/Divested Rev/Profit 2016A LOE/Divested Rev/Profit 2017E Change 2017E vs 2016A Revenue Profit Revenue Profit Revenue Profit Optho Rx • Lotemax® LOE 1Q18 (anticipated) • Ista
Slide 30: Divestitures Included in 2017 Financials
Divestitures Included in 2017 Financials1 29 Divestiture Date Closed Revenue EBITDA Obagi Nov. 9, 2017 ~$60M ~$20M iNova Sept. 29, 2017 ~$195M ~$100M Dendreon June 28, 2017 ~$165M ~$65M Skincare Brands (CeraVe, AcneFree and AMBI) March 3, 2017 ~$35M ~$15M Other2 Various ~$5M ~$0M TOTAL1 ~$460M ~$200
Slide 31: 3Q17 Other Financial Information
3Q17 Other Financial Information1 Three Months Ended Favorable (Unfavorable) Sept. 30, 2017 Sept. 30, 2016 Reported Constant Currency3 Cash Interest Expense $424M $437M 3% 3% Net Interest Expense1,2 $456M $435M (5%) (5%) Non-cash adjustments Depreciation1,2 $42M $43M 2% 2% Non-cash share-based Comp1
Slide 32: Other Financial Information for Nine Months ended Sept. 30, 2017
Other Financial Information1 for Nine Months ended Sept. 30, 2017 Nine Months Ended Favorable (Unfavorable) Sept. 30, 2017 Sept. 30, 2016 Reported Constant Currency3 Cash Interest Expense $1,292M $1,280M (1%) (1%) Net Interest Expense1,2 $1,383M $1,274M (9%) (8%) Non-cash adjustments Depreciation1,2
Slide 33: Non-GAAP Adjustments EPS Impact (Quarter-to-Date)
Non-GAAP Adjustments EPS Impact (Quarter-to-Date) (a) This subtotal reflects the Adjusted Net income(loss) (non-GAAP) reported by the Company for the periods ended Sept. 30, 2017 and 2016 using the methodology for calculating Adjusted Net Income(loss) (non-GAAP) as of that date. (b) As of the third
Slide 34: Non-GAAP Adjustments EPS Impact (Year-to-Date)
Non-GAAP Adjustments EPS Impact (Year-to-Date) (a) This subtotal reflects the Adjusted Net income(loss) (non-GAAP) reported by the Company for the period ended Sept. 30, 2017 and 2016 using the methodology for calculating Adjusted Net Income(loss) (non-GAAP) as of that date. (b) As of the third quar
Slide 35: 3Q17 Top Products – B+L / International
3Q17 Top 10 Products – B+L / International Rank Product 3Q17 2Q17 1Q17 4Q16 3Q16 1 SofLens® $83M $76M $69M $79M $79M 2 Ocuvite® + PreserVision® $73M $71M $58M $70M $66M 3 renu® $57M $55M $51M $55M $60M 4 PureVision® $37M $31M $31M $37M $35M 5 Biotrue® MultiPurpose Solution $34M $36M $31M $32M $33M 6
Slide 36: 3Q17 Top 10 Products – Branded Rx
Rank Product 3Q17 2Q17 1Q17 4Q16 3Q16 1 XIFAXAN® $286M $233M $185M $251M $273M 2 GLUMETZA® $46M $37M $23M $24M $24M 3 APRISO® $42M $39M $29M $39M $38M 4 UCERIS®1 $37M $37M $29M $45M $41M 5 RETIN-A® Franchise $27M $24M $31M $32M $32M 6 ARESTIN® $26M $28M $24M $37M $28M 7 ELIDEL® $21M $18M $21M $23M $
Slide 37: 3Q17 Top Products – U.S. Diversified Products
3Q17 Top 10 Products – U.S. Diversified Products Rank Product 3Q17 2Q17 1Q17 4Q16 3Q16 1 WELLBUTRIN® $61M $58M $49M $67M $65M 2 XENAZINE® US $28M $32M $29M $33M $35M 3 ISUPREL® $23M $33M $38M $42M $30M 4 CUPRIMINE® $20M $20M $20M $22M $29M 5 SYPRINE® $18M $27M $20M $20M $26M 6 MEPHYTON® $14M $9M $17
Slide 38: Bausch + Lomb / Int'l Segment Trailing Five Quarters
Bausch + Lomb / Int’l Segment Trailing Five Quarters1 Bausch + Lomb / International 3Q17 2Q17 1Q17 4Q16 3Q16 Global Vision Care Revenue $208M $187M $170M $178M $198M Global Surgical Revenue4 $161M $175M $154M $177M $155M Global Consumer Revenue $392M $379M $375M $397M $401M Global Ophtho Rx Revenue
Slide 39: Branded Rx Segment Trailing Five Quarters
Branded Rx Segment Trailing Five Quarters1 Brand Rx 3Q17 2Q17 1Q17 4Q16 3Q16 Salix Revenue $452M $387M $302M $414M $437M Dermatology Revenue $148M $130M $192M $214M $223M Dendreon Revenue $0M $83M $81M $77M $77M Dentistry Revenue $32M $35M $28M $39M $29M All Other Revenue $1M $1M $1M $1M $0M Segment
Slide 40: U.S. Diversified Products Segment Trailing Five Quarters
U.S. Diversified Products Segment Trailing Five Quarters1 Diversified Products 3Q17 2Q17 1Q17 4Q16 3Q16 Neuro & Other Revenue $227M $248M $243M $276M $321M Generics Revenue $82M $82M $85M $93M $120M Solta Revenue $7M $9M $8M $9M $8M Obagi Revenue $16M $16M $17M $17M $17M Other Revenue $0M $1M $2M $3
Slide 41: Selected U.S. Businesses Pipeline Inventory Trending (Quarter-to-Date)
Selected U.S. Businesses Pipeline Inventory Trending (Quarter-to-Date) Months on Hand Business Units As of June 30, 2016 As of Sept 30, 2016 Change 3Q16 As of June 30, 2017 As of Sept 30, 2017 Change 3Q17 Relative Change 3Q17 vs 3Q16 Change Sept. 30, 2017 vs Sept. 30, 2016 Derm 1.52 1.70 0.18 1.33 1
Slide 42: Selected U.S. Businesses Pipeline Inventory Trending (Year-to-Date)
Selected U.S. Businesses Pipeline Inventory Trending (Year-to-Date) Months on Hand Business Units As of Dec. 31, 2015 As of Sept 30, 2016 Change YTD16 As of Dec. 31, 2016 As of Sept 30, 2017 Change YTD17 Relative Change 17 vs 16 Change Sept. 30, 2017 vs Sept. 30, 2016 Derm 0.99 1.70 0.71 1.34 1.38 0
Slide 43: Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation
Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation (a) These subtotals reflect Adjusted financial measures (non-GAAP) reported by the Company for the 2017 and 2016 periods presented using the methodology for calculating the Adjusted financial measures (non-GAAP) as of those dates. (
Slide 44: Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation
Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation (a) These subtotals reflect Adjusted financial measures (non-GAAP) reported by the Company for the 2017 and 2016 periods presented using the methodology for calculating the Adjusted financial measures (non-GAAP) as of those dates. (
Slide 45: Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation
Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation (a) These subtotals reflect Adjusted financial measures (non-GAAP) reported by the Company for the 2016 periods presented using the methodology for calculating the Adjusted financial measures (non-GAAP) as of those dates. (b) As of
Slide 46: Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation
Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation 45 (a) These subtotals reflect Adjusted financial measures (non-GAAP) reported by the Company for the 2017 and 2016 periods presented using the methodology for calculating the Adjusted financial measures (non-GAAP) as of those dates
Slide 47: Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation
Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation (a) These subtotals reflect Adjusted financial measures (non-GAAP) reported by the Company for the 2017 and 2016 periods presented using the methodology for calculating the Adjusted financial measures (non-GAAP) as of those dates. 4
Slide 48: Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation
Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation (a) These subtotals reflect Adjusted financial measures (non-GAAP) reported by the Company for the 2017 and 2016 periods presented using the methodology for calculating the Adjusted financial measures (non-GAAP) as of those dates. 4
Slide 49: Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation
Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation (a) These subtotals reflect Adjusted financial measures (non-GAAP) reported by the Company for the 2017 and 2016 periods presented using the methodology for calculating the Adjusted financial measures (non-GAAP) as of those dates. 4
Slide 50: Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation
Financial Summary – Adjusted (non-GAAP) Presentation Reconciliation (a) These subtotals reflect Adjusted financial measures (non-GAAP) reported by the Company for the 2017 and 2016 periods presented using the methodology for calculating the Adjusted financial measures (non-GAAP) as of those dates. 4
Slide 51: Reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA (Quarter-to-Date)
Reconciliation of reported Net Income (Loss) to EBITDA and Adjusted EBITDA ($M) (Quarter-to-Date) (b) This subtotal reflects the Adjusted EBITDA (non-GAAP) reported by the Company for the three months ended Sept. 30, 2016 using the methodology for calculating Adjusted EBITDA (non-GAAP) as of that da
Slide 52: Reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA (Year-to-Date)
Reconciliation of reported Net Income (Loss) to EBITDA and Adjusted EBITDA ($M) (Year-to-Date) (b) This subtotal reflects the Adjusted EBITDA (non-GAAP) reported by the Company for the nine months ended Sept. 30, 2016 using the methodology for calculating Adjusted EBITDA (non-GAAP) as of that date.
Slide 53: Reconciliation of reported Growth to Organic Growth (Quarter-to-Date)
Reconciliation of reported Growth to Organic Growth ($M) (Quarter-to-Date) 1. See Slide 2 and Appendix for further non-GAAP information. (e) As of the third quarter of 2017, one product has been removed from the Global Surgical business unit and added to the International business unit. This change
Slide 54: Reconciliation of reported Growth to Organic Growth (Year-to-Date)
Reconciliation of reported Growth to Organic Growth ($M) (Year-to-Date) 53 1. See Slide 2 and Appendix for further non-GAAP information. (d) As of the third quarter of 2017, one product has been removed from the Global Surgical business unit and added to the International business unit. This change
Slide 55: Reconciliation of TTM adjusted EBITDA
Reconciliation of TTM adjusted EBITDA ($M) TTM TTM TTM TTM TTM Sep-17 Jun-17 Mar-17 Dec-16 Sep-16 Net (loss) income attributable to Valeant Pharmaceuticals International, Inc. 1,376$ (1,143)$ (1,407)$ (2,409)$ (2,279)$ Interest expense, net 1,848 1,859 1,873 1,828 1,794 Recovery of income taxes (2,6
Slide 56: Year-to-Date Financial Results
Year-to-Date Financial Results 1. See Slides 2 and 3 and this Appendix for further non-GAAP information. 2. The non-GAAP measures for historic periods are calculated using the former methodologies used as of that date. See this Appendix for a presentation of the non- GAAP measures on the same basis
Slide 57: Year-to-Date Segment Results – Bausch + Lomb / International
Year-to-Date Segment Results – Bausch + Lomb / International Nine Months Ended Favorable (Unfavorable) Sept. 30, 2017 Sept. 30, 2016 Reported Constant Currency3 Global Vision Care $565M $565M 0% 1% Global Surgical4 $490M $495M (1%) 0% Global Consumer $1,147M $1,180M (3%) (4%) Global Ophtho Rx $459M
Slide 58: Year-to-Date Segment Results – Branded Rx
Year-to-Date Segment Results – Branded Rx Nine Months Ended Favorable (Unfavorable) Sept. 30, 2017 Sept. 30, 2016 Reported Constant Currency3 Salix Revenue $1,141M $1,117M 2% 2% Dermatology Revenue $470M $626M (25%) (25%) Dendreon Revenue $164M $226M (27%) (27%) Dentistry Revenue $95M $113M (16%) (1
Slide 59: Year-to-Date Segment Results – U.S. Diversified
Year-to-Date Segment Results – U.S. Diversified Nine Months Ended Favorable (Unfavorable) Sept. 30, 2017 Sept. 30, 2016 Reported Constant Currency3 Neuro & Other Revenue $718M $1,087M (34%) (34%) Generics Revenue $249M $362M (31%) (31%) Solta Revenue $24M $20M 20% 20% Obagi Revenue $49M $41M 20% 20%
Slide 60: Non-GAAP Appendix: Description of Non-GAAP Financial Measures
Non-GAAP Appendix 59 Description of Non-GAAP Financial Measures To supplement the financial measures prepared in accordance with U.S. generally accepted accounting principles (GAAP), the Company uses certain non-GAAP financial measures, as follows. These measures do not have any standardized meaning
Slide 61: Non-GAAP Appendix: Adjusted EBITDA Adjustments
Non-GAAP Appendix 60 Adjusted EBITDA reflect adjustments based on the following items: Restructuring and integration costs: Prior to 2016, the Company completed a number of acquisitions, which resulted in operating expenses which varied significantly from period to period and which would not otherwi
Slide 62: Non-GAAP Appendix: Share-based Compensation
Non-GAAP Appendix 61 Share-based Compensation: The Company excludes the impact of costs relating to share-based compensation. The Company believes that the exclusion of share-based compensation expense assists investors in the comparisons of operating results to peer companies. Share-based compensat
Slide 63: Non-GAAP Appendix: Adjusted EBITDA
Non-GAAP Appendix 62 Finally, to the extent not already adjusted for above, Adjusted EBITDA (non-GAAP) reflects adjustments for interest, taxes, depreciation and amortization (EBITDA represents earnings before interest, taxes, depreciation and amortization). As indicated above, in addition to identi
Slide 64: Non-GAAP Appendix: Adjusted EBITA / Operating Income
Non-GAAP Appendix 63 Adjusted EBITA/Adjusted EBITA Margin/Adjusted Operating Income Management uses these non-GAAP measures (the most directly comparable GAAP financial measure for which is Total GAAP Revenue less total operating expenses (GAAP)) to assess performance of its business units and opera
Slide 65: Non-GAAP Appendix: Adjusted Gross Profit / Margin
Non-GAAP Appendix 64 Adjusted Gross Profit/Adjusted Gross Margin Management uses these non-GAAP measures (the most directly comparable GAAP financial measure for which is Product sales less Cost of goods sold) to assess performance of its business units and operating and reportable segments, and the
Slide 66: Non-GAAP Appendix: Adjusted R&D
Non-GAAP Appendix 65 Adjusted R&D Management uses this non-GAAP measure (the most directly comparable GAAP financial measure for which is research and development expenses) as a supplemental measure for period-to- period comparison. This non-GAAP measure reflects adjustments for a charge in connecti
Slide 67: Non-GAAP Appendix: Adjusted Net Income
Non-GAAP Appendix 66 Adjusted net income (non-GAAP) reflects adjustments based on the following items: Acquisition- related adjustments excluding amortization of intangible assets: The Company has excluded the impact of acquisition-related contingent consideration non-cash adjustments due to the inh
Slide 68: Non-GAAP Appendix: Acquired IPR&D and Asset Impairments
Non-GAAP Appendix 67 Acquired in-process research and development costs: The Company has excluded expenses associated with acquired in- process research and development, as these amounts are inconsistent in amount and frequency and are significantly impacted by the timing, size and nature of acquisi
Slide 69: Non-GAAP Appendix: Adjusted Net Income Methodology
Non-GAAP Appendix 68 As indicated above, in addition to identifying new primary financial performance measures, the Company also assessed the methodology with which it was calculating these non-GAAP measures and made updates where it deemed appropriate to better reflect the underlying business. As a
Slide 70: Constant Currency Appendix
Constant Currency Appendix 69 Constant Currency Changes in the relative values of non-US currencies to the US dollar may affect the Company’s financial results and financial position. To assist investors in evaluating the Company’s performance, we have adjusted for foreign currency effects. Constant