Amended Quarterly Report (10-q/a)

Recently Issued Accounting Standards Not Yet Adopted (continued)

Description

Effective Date

Effect on the Financial Statements or Other Significant Matters

Measurement of Credit Losses on Financial Instruments

This guidance changes the impairment model for most financial assets and certain other instruments, replacing the current "incurred loss" approach with an "expected loss" credit impairment model, which will apply to most financial assets measured at amortized cost and certain other instruments, including trade and other receivables, loans, held-to-maturity debt securities,and off-balance sheet credit exposures such as letters of credit. Early adoption is permitted.

January 1, 2020

We are currently evaluating the new standard for potential impacts on our receivables, debt, and other financial instruments.

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

_______________________________________________

FORM 10-Q/A

(Amendment No. 1)

_______________________________________________



[X]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: July 2, 2016



[ ]	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 001-36353

_______________________________________________

Perrigo Company plc

(Exact name of registrant as specified in its charter)

_______________________________________________



Ireland		Not Applicable
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

Treasury Building, Lower Grand Canal Street, Dublin 2, Ireland		-
(Address of principal executive offices)		(Zip Code)

+353 1 7094000

(Registrant’s telephone number, including area code)

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

________________________________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such report), and (2) has been subject to such filing requirements for the past 90 days. YES [ ] NO [X]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). YES [ ] NO [X ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and "emerging growth company" in Rule 12b-2 of the Exchange Act.



Large accelerated filer	[X]	Accelerated filer	[ ]	Non-accelerated filer	[ ]	Smaller reporting company	[ ]
Emerging growth company	[ ]			(Do not check if a smaller reporting company)

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.							[ ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). [ ] YES [X] NO

As of August 5, 2016 , there were 143,280,822 ordinary shares outstanding.

PERRIGO COMPANY PLC

FORM 10-Q/A

INDEX



		PAGE NUMBER
Cautionary Note Regarding Forward-Looking Statements		1

Explanatory Note		2

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited)

Condensed Consolidated Statements of Operations for the Three and Six Months Ended July 2, 2016 and June 27, 2015		3

Condensed Consolidated Statements of Comprehensive Income (Loss) for the Three and Six Months Ended July 2, 2016 and June 27, 2015		4

Condensed Consolidated Balance Sheets as of July 2, 2016 and December 31, 2015		5

Condensed Consolidated Statements of Cash Flows for the Six Months Ended July 2, 2016 and June 27, 2015		6

Notes to the Condensed Consolidated Financial Statements

1	Summary of Significant Accounting Policies	7

2	Acquisitions	18

3	Goodwill and Other Intangible Assets	24

4	Accounts Receivable Factoring	27

5	Inventories	27

6	Fair Value Measurements	27

7	Investments	31

8	Derivative Instruments and Hedging Activities	31

9	Assets Held For Sale	34

10	Indebtedness	36

11	Earnings per Share and Shareholders' Equity	39

12	Accumulated Other Comprehensive Income (Loss)	39

13	Income Taxes	40

14	Commitments and Contingencies	41

15	Collaboration Agreements and Other Contractual Arrangements	42

16	Restructuring Charges	42

17	Segment Information	43

18	Subsequent Events	44

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations		45

Item 3. Quantitative and Qualitative Disclosures About Market Risk		64

Item 4. Controls and Procedures		64

PART II. OTHER INFORMATION

Item 1. Legal Proceedings		66

Item 1A. Risk Factors		66

Item 5. Other Information		66

Item 6. Exhibits		66

SIGNATURES		69

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain statements in this report are “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and are subject to the safe harbor created thereby. These statements relate to future events or our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause our, or our industry's actual results, levels of activity, performance or achievements to be materially different from those expressed or implied by any forward-looking statements. In particular, statements about our expectations, beliefs, plans, objectives, assumptions, future events or future performance contained in this report, including certain statements contained in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” are forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as “may,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “intend,” “believe,” “estimate,” “predict,” “potential” or the negative of those terms or other comparable terminology.

Please see Item 1A of our Form 10-K for the year ended December 31, 2016 for a discussion of certain important risk factors that relate to forward-looking statements contained in this report. We have based these forward-looking statements on our current expectations, assumptions, estimates and projections. While we believe these expectations, assumptions, estimates and projections are reasonable, such forward-looking statements are only predictions and involve known and unknown risks and uncertainties, many of which are beyond our control, including: the timing, amount and cost of any share repurchases; future impairment charges; customer acceptance of new products; competition from other industry participants, some of whom have greater marketing resources or larger market shares in certain product categories than we do; pricing pressures from customers and consumers; potential third-party claims and litigation, including litigation relating to our restatement of previously-filed financial information; potential impacts of ongoing or future government investigations and regulatory initiatives; general economic conditions; fluctuations in currency exchange rates and interest rates; the consummation of announced acquisitions or dispositions, and our ability to realize the desired benefits thereof; and the ability to execute and achieve the desired benefits of announced cost-reduction efforts and other initiatives. In addition, we may identify and be unable to remediate one or more material weaknesses in our internal control over financial reporting, may encounter unanticipated material issues or additional adjustments that could delay the filing of required periodic reports with the United States Securities and Exchange Commission, or may be unable to regain compliance with the NYSE continued listing rules. Furthermore, we and/or our subsidiaries may incur additional tax liabilities in respect of 2016 and prior years as a result of any restatement or may be found to have breached certain provisions of Irish company legislation in respect of prior financial statements and if so may incur additional expenses and penalties. These and other important factors, including those discussed in our Form 10-K for the year ended December 31, 2016 and in this report under "Risk Factors" and in any subsequent filings with the Securities and Exchange Commission, may cause actual results, performance or achievements to differ materially from those expressed or implied by these forward-looking statements. The forward-looking statements in this report are made only as of the date hereof, and unless otherwise required by applicable securities laws, we disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise.

TRADEMARKS, TRADE NAMES AND SERVICE MARKS

This report contains trademarks, trade names and service marks that are the property of Perrigo Company plc, as well as, for informational purposes, trademarks, trade names, and service marks that are the property of other organizations. Solely for convenience, certain trademarks, trade names, and service marks referred to in this report appear without the ^® , ™ and ^SM symbols, but those references are not intended to indicate that we or the applicable owner, as the case may be, will not assert, to the fullest extent under applicable law, our or their rights to such trademarks, trade names, and service marks.

EXPLANATORY NOTE

We are filing this Amendment No. 1 to the Quarterly Report on Form 10-Q ("Form 10-Q/A") for the quarterly period ended July 2, 2016, which was filed with the United States Securities and Exchange Commission (“SEC”) on August 10, 2016 (the "Original Filing"), to reflect restatements of the Condensed Consolidated Balance Sheet at July 2, 2016 and December 31, 2015, and the Condensed Consolidated Statements of Operations, Condensed Consolidated Statement of Comprehensive Income (Loss), and Condensed Consolidated Cash Flows for the three and six months ended July 2, 2016 and June 27, 2015, and the related notes thereto. We intend to file our Annual Report on Form 10-K for the year ended December 31, 2016 (“2016 Form 10-K”), which will include consolidated financial statements and selected financial data for the six months ended December 31, 2015, and the years ended June 27, 2015 and June 28, 2014 which are restated (the “Restated Periods”). As described below, the restatement follows a correction in accounting under U.S. generally accepted accounting principles (“U.S. GAAP”) related to the Tysabri ^® royalty stream.

In connection with our year-end financial statement close and preparation of our 2016 Form 10-K, misstatements were identified in certain of our previous financial statements. As a result on April 19, 2017, the Board of Directors, after recommendation from the Audit Committee and consultation with Management, concluded that such financial statements, and certain financial statements for interim periods within the Restated Periods, should no longer be relied upon and would require restatement. This determination follows a correction in accounting under U.S. GAAP related to the contingent payments from Elan's May 2013 sale of Tysabri ^® to Biogen (the "Tysabri ^® royalty stream"). It was determined that the Tysabri ^® royalty stream should be recorded as a financial asset, rather than an intangible asset, on the date of acquisition. We have elected to account for the Tysabri ^® financial asset using the fair value option model. In addition, we identified certain misstatements related to the calculation of deferred tax liabilities that existed at the time of the acquisition of Omega Pharma Invest N.V. ("Omega"). As part of this restatement we also considered other previously identified adjustments. Refer to Item 1. Note 1 for additional information on the restatement. Refer to Item 1. Note 10 for additional information on how this restatement affects our debt covenants.

The following sections in the Original Filing are revised in this Form 10-Q/A, solely as a result of, and to reflect, the restatement:

Part I - Item 1 - Consolidated Financial Statements

Part I - Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations

Part I - Item 4 - Controls and Procedures

Part II - Item 1A - Risk Factors

Part II - Item 6 - Exhibits

Pursuant to the rules of the SEC, Part II, Item 6 of the Original Filing has been amended to include the currently-dated certifications from our principal executive officer and principal financial officer, as required by Sections 302 and 906 of the Sarbanes-Oxley Act of 2002. The certifications of the principal executive officer and principal financial officer are included to this Form 10-Q/A as Exhibits 31.1, 31.2 and 32.

For the convenience of the reader, this Form 10-Q/A sets forth the information in the Original Filing in its entirety, as such information is modified and superseded where necessary to reflect the restatement and related revisions. Except as provided above, this Form 10-Q/A does not reflect events occurring after the date of the Original Filing and should be read in conjunction with our filings with the SEC subsequent to date of the Original Filing, in each case as those filings may have been superseded or amended.

PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS (UNAUDITED)

PERRIGO COMPANY PLC

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in millions, except per share amounts)

(unaudited)



	Three Months Ended						Six Months Ended
	July 2, 2016			June 27, 2015			July 2, 2016			June 27, 2015
	Restated			Restated			Restated			Restated
Net sales	$	1,340.5		$	1,415.2		$	2,687.8		$	2,382.4
Cost of sales	794.0			814.2			1,608.2			1,412.0
Gross profit	546.5			601.0			1,079.6			970.4

Operating expenses
Distribution	22.5			23.7			44.3			38.4
Research and development	47.0			62.6			92.2			98.0
Selling	171.6			174.9			352.4			223.7
Administration	104.3			140.8			211.8			219.8
Impairment charges	10.5			6.8			414.4			6.8
Restructuring	5.8			(0.1		)	11.3			1.0
Total operating expenses	361.7			408.7			1,126.4			587.7

Operating income	184.8			192.3			(46.8		)	382.7

Tysabri ^® royalty stream - change in fair value	910.8			69.2			1,115.3			(31.5		)
Interest expense, net	57.4			45.9			108.6			89.2
Other expense, net	28.8			15.8			31.3			273.9
Loss on extinguishment of debt	—			0.9			0.4			0.9
Income (loss) before income taxes	(812.2		)	60.5			(1,302.4		)	50.2
Income tax expense (benefit)	(277.9		)	82.7			(238.9		)	94.7
Net loss	$	(534.3	)	$	(22.2	)	$	(1,063.5	)	$	(44.5	)

Loss per share
Basic	$	(3.73	)	$	(0.15	)	$	(7.43	)	$	(0.31	)
Diluted	$	(3.73	)	$	(0.15	)	$	(7.43	)	$	(0.31	)

Weighted-average shares outstanding
Basic	143.2			146.3			143.2			143.5
Diluted	143.2			146.3			143.2			143.5

Dividends declared per share	$	0.145		$	0.125		$	0.29		$	0.25

See accompanying Notes to the Condensed Consolidated Financial Statements

Perrigo Company plc - Item 1

PERRIGO COMPANY PLC

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

(in millions)

(unaudited)



	Three Months Ended						Six Months Ended
	July 2, 2016			June 27, 2015			July 2, 2016			June 27, 2015
	Restated			Restated			Restated			Restated
Net loss	$	(534.3	)	$	(22.2	)	$	(1,063.5	)	$	(44.5	)
Other comprehensive income (loss):
Foreign currency translation adjustments	(107.6		)	118.6			43.9			90.8
Change in fair value of derivative financial instruments, net of tax	(1.3		)	4.8			(7.0		)	5.5
Change in fair value of investment securities, net of tax	2.4			(6.1		)	8.5			(4.9		)
Change in post-retirement and pension liability adjustments, net of tax	(0.3		)	5.1			0.6			4.7
Other comprehensive income (loss), net of tax	(106.8		)	122.4			46.0			96.1
Comprehensive income (loss)	$	(641.1	)	$	100.2		$	(1,017.5	)	$	51.6

See accompanying Notes to the Condensed Consolidated Financial Statements

Perrigo Company plc - Item 1

PERRIGO COMPANY PLC

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions)

(unaudited)



	July 2, 2016			December 31, 2015
	Restated			Restated
Assets
Cash and cash equivalents	$	641.8		$	417.8
Accounts receivable, net of allowance for doubtful accounts of $5.4 million, and $4.5 million, respectively	1,194.1			1,189.0
Inventories	894.6			898.7
Prepaid expenses and other current assets	297.3			286.1
Total current assets	3,027.8			2,791.6
Property, plant and equipment, net	888.6			886.2
Tysabri ^® royalty stream - at fair value	4,020.0			5,310.0
Goodwill and other indefinite-lived intangible assets	6,425.8			7,069.0
Other intangible assets, net	3,607.6			2,973.1
Non-current deferred income taxes	109.3			71.4
Other non-current assets	212.1			248.3
Total non-current assets	15,263.4			16,558.0
Total assets	$	18,291.2		$	19,349.6
Liabilities and Shareholders’ Equity
Accounts payable	$	509.1		$	555.8
Payroll and related taxes	98.4			125.3
Accrued customer programs	353.0			396.0
Accrued liabilities	295.7			351.9
Accrued income taxes	45.9			62.7
Current indebtedness	758.1			1,060.5
Total current liabilities	2,060.2			2,552.2
Long-term debt, less current portion	5,652.5			4,971.6
Non-current deferred income taxes	1,107.6			1,372.7
Other non-current liabilities	422.5			346.3
Total non-current liabilities	7,182.6			6,690.6
Total liabilities	9,242.8			9,242.8
Commitments and contingencies - Note 14
Shareholders’ equity
Controlling interest:
Preferred shares, $0.0001 par value, 10 million shares authorized	—			—
Ordinary shares, €0.001 par value, 10 billion shares authorized	8,144.0			8,142.6
Accumulated other comprehensive income (loss)	30.7			(15.3		)
Retained earnings	874.3			1,980.1
Total controlling interest	9,049.0			10,107.4
Noncontrolling interest	(0.6		)	(0.6		)
Total shareholders’ equity	9,048.4			10,106.8
Total liabilities and shareholders' equity	$	18,291.2		$	19,349.6

Supplemental Disclosures of Balance Sheet Information
Preferred shares, issued and outstanding	—			—
Ordinary shares, issued and outstanding	143.2			143.1

See accompanying Notes to the Condensed Consolidated Financial Statements

Perrigo Company plc - Item 1

PERRIGO COMPANY PLC

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions)

(unaudited)



	Six Months Ended
	July 2, 2016			June 27, 2015
	Restated			Restated
Cash Flows From (For) Operating Activities
Net loss	$	(1,063.5	)	$	(44.5	)
Adjustments to derive cash flows
Depreciation and amortization	223.7			149.9
Loss on acquisition-related foreign currency derivatives	—			300.0
Share-based compensation	9.6			15.5
Impairment charges	414.4			6.8
Tysabri ^® royalty stream - change in fair value	1,115.3			(31.5		)
Loss on extinguishment of debt	0.4			0.9
Restructuring charges	11.3			1.0
Deferred income taxes	(322.8		)	20.2
Amortization of financing fees and debt discount (premium)	(16.2		)	(1.8		)
Other non-cash adjustments	28.1			5.4
Subtotal	400.3			421.9
Increase (decrease) in cash due to:
Accounts receivable	41.2			(47.7		)
Inventories	4.7			8.0
Accounts payable	(47.0		)	167.4
Payroll and related taxes	(39.2		)	(3.8		)
Accrued customer programs	(44.2		)	19.5
Accrued liabilities	(53.9		)	(9.3		)
Accrued income taxes	(2.8		)	(11.3		)
Other	(29.4		)	18.7
Subtotal	(170.6		)	141.5
Net cash from (for) operating activities	229.7			563.4
Cash Flows From (For) Investing Activities
Proceeds from royalty rights	169.9			168.9
Acquisitions of businesses, net of cash acquired	(419.7		)	(2,098.8		)
Additions to property, plant and equipment	(57.1		)	(89.0		)
Settlement of acquisition-related foreign currency derivatives	—			(303.5		)
Other investing	(1.0		)	1.0
Net cash from (for) investing activities	(307.9		)	(2,321.4		)
Cash Flows From (For) Financing Activities
Issuances of long-term debt	1,190.3			—
Payments on long-term debt	(28.7		)	(889.0		)
Borrowings (repayments) of revolving credit agreements and other financing, net	(803.9		)	(52.0		)
Deferred financing fees	(2.4		)	(3.3		)
Issuance of ordinary shares	3.5			4.0
Cash dividends	(41.6		)	(35.9		)
Other financing	(11.7		)	(10.6		)
Net cash from (for) financing activities	305.5			(986.8		)
Effect of exchange rate changes on cash and cash equivalents	(3.3		)	(65.7		)
Net increase (decrease) in cash and cash equivalents	224.0			(2,810.5		)
Cash and cash equivalents, beginning of period	417.8			3,596.1
Cash and cash equivalents, end of period	$	641.8		$	785.6

Supplemental Disclosures of Cash Flow Information
Cash paid/received during the year for:
Interest paid	$	89.5		$	86.3
Interest received	$	0.7		$	0.7
Income taxes paid	$	38.0		$	110.2
Income taxes refunded	$	0.3		$	2.1

See accompanying Notes to the Condensed Consolidated Financial Statements

Perrigo Company plc - Item 1

Note 1

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

General Information

The Company

Perrigo Company plc was incorporated under the laws of Ireland on June 28, 2013 and became the successor registrant of Perrigo Company, a Michigan corporation, on December 18, 2013 in connection with the acquisition of Elan Corporation, plc ("Elan"). Unless the context requires otherwise, the terms "Perrigo," the "Company," "we," "our," "us," and similar pronouns used herein refer to Perrigo Company plc, its subsidiaries, and all predecessors of Perrigo Company plc and its subsidiaries. We are a leading global over-the-counter ("OTC") consumer goods and specialty pharmaceutical company, offering patients and customers high quality products at affordable prices. From our beginning in 1887 as a packager of home remedies, we have grown to become the world's largest manufacturer of OTC healthcare products and supplier of infant formulas for the store brand market. We are also a leading provider of generic extended topical prescription products, and we receive royalties from sales of the multiple sclerosis drug Tysabri ^® . We provide “Quality Affordable Healthcare Products ^® ” across a wide variety of product categories and geographies, primarily in North America, Europe, and Australia, as well as in other markets, including Israel, China, and Latin America.

Basis of Presentation

The accompanying unaudited Condensed Consolidated Financial Statements have been prepared in accordance with U.S. generally accepted accounting principles ("U.S. GAAP") for interim financial information and with the instructions to Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. The unaudited Condensed Consolidated Financial Statements should be read in conjunction with the consolidated financial statements and footnotes included in our Annual Report on Form 10-K for the year ended December 31, 2016. In the opinion of management, all adjustments (consisting of normal recurring accruals and other adjustments) considered necessary for a fair presentation have been included. The Condensed Consolidated Financial Statements include our accounts and the accounts of all majority-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.

Our fiscal year previously consisted of a 52- or 53-week year ending on or around June 30 of each year with each quarter ending on the Saturday closest to each calendar quarter-end. Beginning on January 1, 2016, we changed our fiscal year to begin on January 1 and end on December 31 of each year. We will continue to cut off our quarterly accounting periods on the Saturday closest to the end of the calendar quarter, with the fourth quarter ending on December 31 of each year.

Restatement

In connection with our year-end financial statement close and preparation of our Annual Report on Form 10-K for 2016, we identified misstatements in our historical financial statements, including for the nine months ended October 1, 2016, six months ended December 31, 2015 , and the years ended June 27, 2015 and June 28, 2014 (the "Restated Periods"). Accordingly, we have restated the Condensed Consolidated Financial Statements for the three and six months ended July 2, 2016 and June 27, 2015 to reflect the correction of the misstatements, the most significant of which are described below. The segments predominantly affected by this restatement are Specialty Sciences and Consumer Healthcare International. Refer to Note 10 for additional information on how this restatement affects our debt covenants.

During the 2016 year-end financial statement close process, and in anticipation of our potential sale of our royalty rights, we evaluated the potential effects of the Tysabri ^® royalty stream sale accounting and the accounting and disclosures associated with the pending 2018 adoption of ASC 606 “Revenues from Contracts with Customers.” After an extensive evaluation of the facts and circumstances and the judgments required to determine the appropriate classification, it was determined that under existing U.S. GAAP the contingent payments from Elan's May 2013 sale of Tysabri ^® to Biogen (the "Tysabri ^® royalty stream") should have been recorded as a financial asset, rather than an intangible asset, on the date of our acquisition of Elan.

Perrigo Company plc - Item 1

Note 1

Our Tysabri ^® royalty stream is now accounted for in our financial statements for fiscal 2016 and prior restated periods as a financial asset using the fair value option. We made the election to account for the Tysabri ^® financial asset using the fair value option as we believe this method is most appropriate for an asset that does not have a par value, a stated interest stream, or a termination date. Accounting for the Tysabri ^® royalty stream as a financial asset required us to adjust our financial statements for the Restated Periods to (1) remove the Tysabri ^® royalty stream from net sales in our Condensed Consolidated Statements of Operations, (2) remove the amortization expense (reflected in cost of goods sold) associated with recording the Tysabri ^® royalty stream as an intangible asset, and (3) include the quarterly changes in fair value of the Tysabri ^® royalty stream as a component of other non-operating income/expense. The cash payments we received from the royalty stream are included in our Condensed Consolidated Statements of Cash Flows for the Restated Periods and reflect the cash received from the Tysabri ^® royalty stream as cash from investing activities, rather than as cash from operating activities.

In addition, in connection with the financial closing for the year ended December 31, 2016, we identified certain tax basis intangible assets that existed at the time of the acquisition of Omega Pharma Invest N.V. (“Omega”) on March 30, 2015 , which reduced the deferred tax liabilities in acquired intangible assets and increased our valuation allowance resulting in a net change to our deferred taxes of approximately $236.3 million . The resulting balance sheet reclassification required a reduction of goodwill, offset by a corresponding reduction to net deferred taxes at the date of the Omega acquisition. Further, we have evaluated the accounting effect subsequent to the acquisition date related to the remeasured deferred tax liability, including the impairments of Omega goodwill recorded in 2016 and certain adjustments to valuation allowances, which have been reflected in the Restated Periods.

In restating our financial statements to correct the misstatements discussed above, we are also making adjustments for previously identified required corrections with respect to the three and six months ended July 2, 2016 and June 27, 2015, which were recorded in our year ended December 31, 2016 and year ended June 27, 2015 financial results. In conjunction with the restatement, we have determined that it would be appropriate within this Form 10-Q/A to reflect these adjustments in the three and six months ended July 2, 2016 and June 27, 2015.

The Condensed Consolidated Balance Sheet, Condensed Consolidated Statements of Operations, Condensed Consolidated Comprehensive Income (Loss), and Condensed Consolidated Statement of Cash Flows, and Notes 2 , 3 , 4 , 5 , 6 , 7 , 8 , 10 , 11 , 12 , 13 , and 17 in these financial statements were updated to reflect the restatement.

The tables below present the impact of the changes to our Condensed Consolidated Financial Statement line items in our Original Filing:

Perrigo Company plc - Item 1

Note 1

Condensed Consolidated Statement of Operations

(in millions, except per share amounts)

(unaudited)



	Three Months Ended
	July 2, 2016
				Adjustments
	Previously Reported			Tysabri ^®			Other				Restated
Net sales	$	1,481.0		$	(88.9	)	$	(51.6	)	(b)	$	1,340.5
Cost of sales	913.8			(72.5		)	(47.3		)	(b)	794.0
Gross profit	567.2			(16.4		)	(4.3		)		546.5

Operating expenses
Distribution	22.5			—			—				22.5
Research and development	47.0			—			—				47.0
Selling	171.6			—			—				171.6
Administration	101.8			—			2.5				104.3
Impairment charges (credits)	(19.8		)	—			30.3			(a)	10.5
Restructuring	5.8			—			—				5.8
Total operating expenses	328.9			—			32.8				361.7

Operating income	238.3			(16.4		)	(37.1		)		184.8

Tysabri ^® royalty stream - change in fair value	—			910.8			—				910.8
Interest expense, net	57.4			—			—				57.4
Other expense, net	29.3			0.2			(0.7		)		28.8
Income (loss) before income taxes	151.6			(927.4		)	(36.4		)		(812.2		)
Income tax (benefit)	(42.7		)	(116.0		)	(119.2		)	(a)(b)(c)	(277.9		)
Net income (loss)	$	194.3		$	(811.4	)	$	82.8			$	(534.3	)


Income (loss) per share
Basic	$	1.36		$	(5.67	)	$	0.58			$	(3.73	)
Diluted	$	1.35		$	(5.67	)	$	0.58			$	(3.73	)

Weighted-average shares outstanding
Basic	143.2										143.2
Diluted	143.6										143.2

(a)

Adjustments primarily related to certain tax basis intangible assets that existed at the time of the acquisition of Omega on March 30, 2015 , which reduced the deferred tax liabilities in acquired intangible assets and increased our valuation allowance resulting in a net change to our deferred taxes. The resulting balance sheet reclassification required a reduction of goodwill, offset by a corresponding reduction to net deferred taxes at the date of the Omega acquisition. The adjustment made at the date of the Omega acquisition also had an impact on previously reported goodwill impairment charges. ("BCH Deferred Tax Matters"). (Income tax expense (benefit): $4.5 million )

(b)

Adjustments primarily related to certain contracts related to a specific Belgium distributor that were consignment in nature due to an option for the distributor to return the product if it was not sold timely. The characterization of the contracts as consignment impacted the timing of revenue recognition in the Condensed Consolidated Statement of Operations and, due to the impact on factoring arrangements, required a reclassification between accounts receivable and current liabilities for the amounts factored for these contracts. (“BCH Belgium Distribution Contracts”) (Income tax expense (benefit): ($3.4) million ))


(c)	Adjustment related to income tax expense (benefit) for interim period tax accounting required under ASC 740, Accounting for Income Taxes. (Income tax expense (benefit): ($121.8) million )

Perrigo Company plc - Item 1

Note 1

Condensed Consolidated Statement of Operations

(in millions, except per share amounts)

(unaudited)



	Six Months Ended
	July 2, 2016
				Adjustments
	Previously Reported			Tysabri ^®			Other				Restated
Net sales	$	2,864.2		$	(174.6	)	$	(1.8	)	(b)	$	2,687.8
Cost of sales	1,774.1			(145.0		)	(20.9		)	(b)	1,608.2
Gross profit	1,090.1			(29.6		)	19.1				1,079.6

Operating expenses
Distribution	44.3			—			—				44.3
Research and development	92.2			—			—				92.2
Selling	352.4			—			—				352.4
Administration	208.2			—			3.6				211.8
Impairment charges	447.2			—			(32.8		)	(a)	414.4
Restructuring	11.3			—			—				11.3
Total operating expenses	1,155.6			—			(29.2		)		1,126.4

Operating loss	(65.5		)	(29.6		)	48.3				(46.8		)

Tysabri ^® royalty stream - change in fair value	—			1,115.3			—				1,115.3
Interest expense, net	108.6			—			—				108.6
Other expense, net	33.1			0.1			(1.9		)		31.3
Loss on extinguishment of debt	0.4			—			—				0.4
Loss before income taxes	(207.6		)	(1,145.0		)	50.2				(1,302.4		)
Income tax benefit	(67.3		)	(143.2		)	(28.4		)	(a)(b)(c)	(238.9		)
Net loss	$	(140.3	)	$	(1,001.8	)	$	78.6			$	(1,063.5	)

Loss per shares
Basic	$	(0.98	)	$	(6.99	)	$	0.54			$	(7.43	)
Diluted	$	(0.98	)	$	(6.99	)	$	0.54			$	(7.43	)

Weighted-average shares outstanding
Basic	143.2										143.2
Diluted	143.6										143.2


(a)	Adjustments primarily related to the BCH Deferred Tax Matters as described above. (Income tax expense (benefit): ($26.4) million )


(b)	Adjustments primarily related to BCH Belgium Distribution Contracts as described above. (Income tax expense (benefit): $3.5 million )


(c)	Adjustment related to income tax expense (benefit) for interim period tax accounting required under ASC 740, Accounting for Income Taxes. (Income tax expense (benefit): ($8.0) million )

Perrigo Company plc - Item 1

Note 1

Condensed Consolidated Statement of Operations

(in millions, except per share amounts)

(unaudited)



	Three Months Ended
	June 27, 2015
				Adjustments
	Previously Reported			Tysabri ^®			Other				Restated
Net sales	$	1,531.6		$	(81.6	)	$	(34.8	)	(b)	$	1,415.2
Cost of sales	903.5			(72.5		)	(16.8		)	(b)	814.2
Gross profit	628.1			(9.1		)	(18.0		)		601.0

Operating expenses
Distribution	23.7			—			—				23.7
Research and development	62.6			—			—				62.6
Selling	174.9			—			—				174.9
Administration	140.1			—			0.7				140.8
Impairment charges	—			—			6.8				6.8
Restructuring	(0.1		)	—			—				(0.1		)
Total operating expenses	401.2			—			7.5				408.7

Operating income	226.9			(9.1		)	(25.5		)		192.3

Tysabri ^® royalty stream - change in fair value	—			69.2			—				69.2
Interest expense, net	45.9			—			—				45.9
Other expense, net	22.7			(0.8		)	(6.1		)		15.8
Loss on extinguishment of debt	0.9			—			—				0.9
Income before income taxes	157.4			(77.5		)	(19.4		)		60.5
Income tax expense	101.0			(9.7		)	(8.6		)	(a)(b)	82.7
Net income (loss)	$	56.4		$	(67.8	)	$	(10.8	)		$	(22.2	)

Income (loss) per share
Basic	$	0.39		$	(0.46	)	$	(0.08	)		$	(0.15	)
Diluted	$	0.38		$	(0.46	)	$	(0.07	)		$	(0.15	)

Weighted-average shares outstanding
Basic	146.3										146.3
Diluted	146.8										146.3


(a)	Adjustments primarily related to the BCH Deferred Tax Matters as described above. (Income tax expense (benefit): $6.5 million )


(b)	Adjustments primarily related to BCH Belgium Distribution Contracts as described above. (Income tax expense (benefit): ( $3.3 million ))

Perrigo Company plc - Item 1

Note 1

Condensed Consolidated Statement of Operations

(in millions, except per share amounts)

(unaudited)



	Six Months Ended
	June 27, 2015
				Adjustments
	Previously Reported			Tysabri ^®			Other				Restated
Net sales	$	2,580.8		$	(161.6	)	$	(36.8	)	(b)	$	2,382.4
Cost of sales	1,573.8			(145.1		)	(16.7		)	(b)	1,412.0
Gross profit	1,007.0			(16.5		)	(20.1		)		970.4

Operating expenses
Distribution	38.4			—			—				38.4
Research and development	98.0			—			—				98.0
Selling	223.7			—			—				223.7
Administration	219.7			—			0.1				219.8
Impairment charges	—			—			6.8				6.8
Restructuring	1.0			—			—				1.0
Total operating expenses	580.8			—			6.9				587.7

Operating income	426.2			(16.5		)	(27.0		)		382.7

Tysabri ^® royalty stream - change in fair value	—			(31.5		)	—				(31.5		)
Interest expense, net	89.2			—			—				89.2
Other expense, net	281.3			—			(7.4		)		273.9
Loss on extinguishment of debt	0.9			—			—				0.9
Income before income taxes	54.8			15.0			(19.6		)		50.2
Income tax expense	93.2			1.9			(0.4		)		94.7
Net loss	$	(38.4	)	$	13.1		$	(19.2	)		$	(44.5	)

Loss per share
Basic	$	(0.27	)	$	0.09		$	(0.13	)		$	(0.31	)
Diluted	$	(0.27	)	$	0.09		$	(0.13	)		$	(0.31	)

Weighted-average shares outstanding
Basic	143.5										143.5
Diluted	143.5										143.5


(b)	Adjustments primarily related to BCH Belgium Distribution Contracts as described above.

Perrigo Company plc - Item 1

Note 1

Condensed Consolidated Balance Sheet

(in millions)

(unaudited)



	July 2, 2016
				Adjustments
	Previously Reported			Tysabri ^®			Other				Restated
Assets
Cash and cash equivalents	$	641.8		$	—		$	—			$	641.8
Accounts receivable, net of allowance for doubtful accounts of $5.4 million	1,199.1			—			(5.0		)		1,194.1
Inventories	894.6			—			—				894.6
Prepaid expenses and other current assets	297.3			—			—				297.3
Total current assets	3,032.8			—			(5.0		)		3,027.8
Property, plant and equipment, net	888.6			—			—				888.6
Tysabri ^® royalty stream - at fair value	—			4,020.0			—				4,020.0
Goodwill and other indefinite-lived intangible assets	6,627.1			—			(201.3		)	(a)(b)	6,425.8
Other intangible assets, net	8,679.3			(5,067.2		)	(4.5		)		3,607.6
Non-current deferred income taxes	100.6			—			8.7			(a)(c)	109.3
Other non-current assets	205.2			—			6.9				212.1
Total non-current assets	16,500.8			(1,047.2		)	(190.2		)		15,263.4
Total assets	$	19,533.6		$	(1,047.2	)	$	(195.2	)		$	18,291.2
Liabilities and Shareholders’ Equity
Accounts payable	$	514.1		$	—		$	(5.0	)		$	509.1
Payroll and related taxes	98.4			—			—				98.4
Accrued customer programs	354.2			—			(1.2		)		353.0
Accrued liabilities	295.7			—			—				295.7
Accrued income taxes	72.5			—			(26.6		)	(a)(b)(c)	45.9
Current indebtedness	758.1			—			—				758.1
Total current liabilities	2,093.0			—			(32.8		)		2,060.2
Long-term debt, less current portion	5,652.5			—			—				5,652.5
Non-current deferred income taxes	1,473.7			(130.9		)	(235.2		)	(a)(b)(c)	1,107.6
Other non-current liabilities	414.7			—			7.8				422.5
Total non-current liabilities	7,540.9			(130.9		)	(227.4		)		7,182.6
Total liabilities	9,633.9			(130.9		)	(260.2		)		9,242.8
Commitments and contingencies - Note 14
Shareholders’ equity
Controlling interest:
Preferred shares, $0.0001 par value, 10 million shares authorized	—			—			—				—
Ordinary shares, €0.001 par value, 10 billion shares authorized	8,144.0			—			—				8,144.0
Accumulated other comprehensive income	31.3			—			(0.6		)	(b)	30.7
Retained earnings	1,725.0			(916.3		)	65.6				874.3
Total controlling interest	9,900.3			(916.3		)	65.0				9,049.0
Noncontrolling interest	(0.6		)	—			—				(0.6		)
Total shareholders’ equity	9,899.7			(916.3		)	65.0				9,048.4
Total liabilities and shareholders' equity	$	19,533.6		$	(1,047.2	)	$	(195.2	)		$	18,291.2


(a)	Adjustments primarily related to the BCH Deferred Tax Matters as described above. (Goodwill and other indefinite-lived intangible assets: $229.0 million , Non-current deferred income tax asset: $278.4 million , and Non-current deferred tax liability of $33.7 million , and Accrued income taxes: $(10.9) million )


(b)	Adjustments primarily related to BCH Belgium Distribution Contracts as described above. (Goodwill and other indefinite-lived intangible assets: $(5.4) million , Non-current deferred income tax liabiliy: $0.7 million , and Accrued income taxes: $(6.1) million )


(c)	Adjustment related to income tax expense (benefit) for interim period tax accounting required under ASC 740, Accounting for Income Taxes. (Accrued income taxes: $(8.1) million ). The balance of the adjustment to deferred taxes relates to jurisdictional netting.

Perrigo Company plc - Item 1

Note 1

Condensed Consolidated Balance Sheet

(in millions)



	December 31, 2015
				Adjustments
	Previously Reported			Tysabri ^®			Other				Restated
Assets
Cash and cash equivalents	$	417.8		$	—		$	—			$	417.8
Accounts receivable, net of allowance for doubtful accounts of $4.5 million	1,193.1			—			(4.1		)	(b)	1,189.0
Inventories	844.4			—			54.3			(b)	898.7
Prepaid expenses and other current assets	289.1			—			(3.0		)		286.1
Total current assets	2,744.4			—			47.2				2,791.6
Property, plant and equipment, net	886.2			—			—				886.2
Tysabri ^® royalty stream - at fair value	—			5,310.0			—				5,310.0
Goodwill and other indefinite-lived intangible assets	7,281.2			—			(212.2		)	(a)(b)	7,069.0
Other intangible assets, net	8,190.5			(5,212.2		)	(5.2		)		2,973.1
Non-current deferred income taxes	54.6			—			16.8			(a)(c)	71.4
Other non-current assets	237.0			—			11.3				248.3
Total non-current assets	16,649.5			97.8			(189.3		)		16,558.0
Total assets	$	19,393.9		$	97.8		$	(142.1	)		$	19,349.6
Liabilities and Shareholders’ Equity
Accounts payable	$	554.9		$	—		$	0.9		(b)	$	555.8
Payroll and related taxes	125.3			—			—				125.3
Accrued customer programs	398.0			—			(2.0		)	(b)	396.0
Accrued liabilities	308.4			—			43.5			(b)	351.9
Accrued income taxes	85.2			—			(22.5		)	(a)	62.7
Current indebtedness	1,018.3			—			42.2			(b)	1,060.5
Total current liabilities	2,490.1			—			62.1				2,552.2
Long-term debt, less current portion	4,971.6			—			—				4,971.6
Non-current deferred income taxes	1,563.7			12.2			(203.2		)	(a)(b)(c)	1,372.7
Other non-current liabilities	332.4			—			13.9			(a)	346.3
Total non-current liabilities	6,867.7			12.2			(189.3		)		6,690.6
Total liabilities	9,357.8			12.2			(127.2		)		9,242.8
Commitments and contingencies - Note 14
Shareholders’ equity
Controlling interest:
Preferred shares, $0.0001 par value, 10 million shares authorized	—			—			—				—
Ordinary shares, €0.001 par value, 10 billion shares authorized	8,144.6			—			(2.0		)		8,142.6
Accumulated other comprehensive (loss)	(15.5		)	—			0.2			(b)	(15.3		)
Retained earnings	1,907.6			85.6			(13.1		)		1,980.1
Total controlling interest	10,036.7			85.6			(14.9		)		10,107.4
Noncontrolling interest	(0.6		)	—			—				(0.6		)
Total shareholders’ equity	10,036.1			85.6			(14.9		)		10,106.8
Total liabilities and shareholders' equity	$	19,393.9		$	97.8		$	(142.1	)		$	19,349.6


(a)	Adjustments primarily related to the BCH Deferred Tax Matters as described above. (Goodwill and other indefinite-lived intangible assets: $(223.3) million , Non-current deferred income tax assets: $272.2 million , and Non-current deferred income tax liability $65.4 million )


(b)	Adjustments primarily related to BCH Belgium Distribution Contracts as described above. (Goodwill and other indefinite-lived intangible assets: $10.2 million and Non-current deferred income taxes: $8.7 million )


(c)	Adjustment related to income tax expense (benefit) for interim period tax accounting required under ASC 740, Accounting for Income Taxes. The balance of the adjustment to deferred taxes relates to jurisdictional netting.

Perrigo Company plc - Item 1

Note 1

Condensed Consolidated Statement of Cash Flows

(in millions)

(unaudited)



	Six Months Ended
	July 2, 2016
				Adjustments
	Previously Reported			Tysabri ^®			Other				Restated
Cash Flows From (For) Operating Activities
Net income (loss)	$	(140.3	)	$	(1,001.8	)	$	78.6			$	(1,063.5	)
Adjustments to derive cash flows
Loss on extinguishment of debt	0.4			—			—				0.4
Restructuring charges	11.3			—			—				11.3
Depreciation and amortization	369.3			(145.0		)	(0.6		)		223.7
Impairment charges	447.2			—			(32.8		)	(a)	414.4
Tysabri ^® royalty stream - change in fair value	—			1,115.3			—				1,115.3
Share-based compensation	7.6			—			2.0				9.6
Amortization of financing fees and debt premium	—			—			(16.2		)		(16.2		)
Deferred income taxes	(157.1		)	(143.2		)	(22.5		)	(a)(b)	(322.8		)
Other non-cash adjustments	28.2			—			(0.1		)		28.1
Subtotal	566.6			(174.7		)	8.4				400.3
Increase (decrease) in cash due to:
Accounts receivable	42.3			5.8			(6.9		)		41.2
Inventories	(50.3		)	—			55.0			(b)	4.7
Accounts payable	(41.1		)	—			(5.9		)		(47.0		)
Payroll and related taxes	(39.2		)	—			—				(39.2		)
Accrued customer programs	(45.3		)	—			1.1			(b)	(44.2		)
Accrued liabilities	(9.8		)	—			(44.1		)	(b)	(53.9		)
Accrued income taxes	21.8			—			(24.6		)	(a)(b)(c)	(2.8		)
Other	(45.4		)	—			16.0				(29.4		)
Subtotal	(167.0		)	5.8			(9.4		)		(170.6		)
Net cash from (for) operating activities	399.6			(168.9		)	(1.0		)		229.7
Cash Flows From (For) Investing Activities
Proceeds from royalty rights	—			168.9			1.0				169.9
Acquisitions of businesses, net of cash acquired	(419.7		)	—			—				(419.7		)
Additions to property, plant and equipment	(57.1		)	—			—				(57.1		)
Other investing	(1.0		)	—			—				(1.0		)
Net cash from (for) investing activities	(477.8		)	168.9			1.0				(307.9		)
Cash Flows From (For) Financing Activities
Issuances of long-term debt	1,190.3			—			—				1,190.3
Payments on long-term debt	(28.7		)	—			—				(28.7		)
Borrowings (repayments) of revolving credit agreements and other financing, net	(803.9		)	—			—				(803.9		)
Deferred financing fees	(2.4		)	—			—				(2.4		)
Issuance of ordinary shares	3.5			—			—				3.5
Cash dividends	(41.6		)	—			—				(41.6		)
Other financing	(11.7		)	—			—				(11.7		)
Net cash from (for) financing activities	305.5			—			—				305.5
Effect of exchange rate changes on cash and cash equivalents	(3.3		)	—			—				(3.3		)
Net increase (decrease) in cash and cash equivalents	224.0			—			—				224.0
Cash and cash equivalents, beginning of period	417.8			—			—				417.8
Cash and cash equivalents, end of period	$	641.8		$	—		$	—			$	641.8


(a)	Adjustments primarily related to the BCH Deferred Tax Matters as described above.


(b)	Adjustments primarily related to BCH Belgium Distribution Contracts as described above.


(c)	Adjustment related to income tax expense (benefit) for interim period tax accounting required under ASC 740, Accounting for Income Taxes.

Perrigo Company plc - Item 1

Note 1

Condensed Consolidated Statement of Cash Flows

(in millions)

(unaudited)



	Six Months Ended
	June 27, 2015
				Adjustments
	Previously Reported			Tysabri ^®			Other				Restated
Cash Flows From (For) Operating Activities
Net income (loss)	$	(38.4	)	$	13.1		$	(19.2	)		$	(44.5	)
Adjustments to derive cash flows
Loss on extinguishment of debt	0.9			—			—				0.9
Restructuring charges	1.0			—			—				1.0
Depreciation and amortization	295.0			(145.1		)	—				149.9
Impairment charges	—			—			6.8				6.8
Tysabri ^® royalty stream - change in fair value	—			(31.5		)	—				(31.5		)
Share-based compensation	15.5			—			—				15.5
Loss on acquisition-related foreign currency derivatives	300.0			—			—				300.0
Amortization of financing fees and debt premium	—			—			(1.8		)		(1.8		)
Deferred income taxes	21.9			1.9			(3.6		)	(a)(b)	20.2
Other non-cash adjustments	12.1			0.1			(6.8		)		5.4
Subtotal	608.0			(161.5		)	(24.6		)		421.9
Increase (decrease) in cash due to:
Accounts receivable	(77.2		)	(6.2		)	35.7			(b)	(47.7		)
Inventories	28.4			—			(20.4		)	(b)	8.0
Accounts payable	187.5			—			(20.1		)	(b)	167.4
Payroll and related taxes	(3.8		)	—			—				(3.8		)
Accrued customer programs	18.1			—			1.4			(b)	19.5
Accrued liabilities	(14.8		)	—			5.5			(b)	(9.3		)
Accrued income taxes	(14.9		)	—			3.6				(11.3		)
Other	(0.6		)	—			19.3				18.7
Subtotal	122.7			(6.2		)	25.0				141.5
Net cash from (for) operating activities	730.7			(167.7		)	0.4				563.4
Cash Flows From (For) Investing Activities
Proceeds from royalty rights	—			167.7			1.2				168.9
Acquisitions of businesses, net of cash acquired	(2,098.8		)	—			—				(2,098.8		)
Settlement of acquisition-related foreign currency derivatives	(303.5		)	—			—				(303.5		)
Additions to property, plant and equipment	(89.0		)	—			—				(89.0		)
Other investing	1.0			—							1.0
Net cash from (for) investing activities	(2,490.3		)	167.7			1.2				(2,321.4		)
Cash Flows From (For) Financing Activities
Payments on long-term debt	(889.0		)	—			—				(889.0		)
Borrowings (repayments) of revolving credit agreements and other financing, net	(50.4		)	—			(1.6		)	(b)	(52.0		)
Deferred financing fees	(3.3		)	—			—				(3.3		)
Premium on early debt retirement	—			—			—				—
Issuance of ordinary shares	4.0			—			—				4.0
Cash dividends	(35.9		)	—			—				(35.9		)
Other financing	(10.6		)	—			—				(10.6		)
Net cash from (for) financing activities	(985.2		)	—			(1.6		)		(986.8		)
Effect of exchange rate changes on cash and cash equivalents	(65.7		)	—			—				(65.7		)
Net increase (decrease) in cash and cash equivalents	(2,810.5		)	—			—				(2,810.5		)
Cash and cash equivalents, beginning of period	3,596.1			—			—				3,596.1
Cash and cash equivalents, end of period	$	785.6		$	—		$	—			$	785.6


(a)	Adjustments primarily related to the BCH Deferred Tax Matters as described above.


(b)	Adjustments primarily related to BCH Belgium Distribution Contracts as described above.

Perrigo Company plc - Item 1

Note 1

The Condensed Consolidated Statement of Comprehensive Income (Loss) was adjusted primarily for a $728.6 million decrease in net income and $923.2 million increase in net loss for the three and six months ended July 2, 2016, respectively, and a $78.6 million decrease in net income and $6.1 million increase in net loss for the three and six months ended June 27, 2015, respectively, and misstatement in foreign currency translation adjustment of $1.4 million and $0.9 million for the three and six months ended July 2, 2016, respectively, and $0.1 million for the six months ended June 27, 2015.

The accumulated effect on Shareholders' Equity at December 27, 2014 was a $41.7 million increase.

Recent Accounting Standard Pronouncements

Below are recent accounting standard updates that we are still assessing to determine the effect on our consolidated financial statements. We do not believe that any other recently issued accounting standards could have a material effect on our consolidated financial statements. As new accounting pronouncements are issued, we will adopt those that are applicable under the circumstances.



Recently Issued Accounting Standards Not Yet Adopted
Standard	Description	Effective Date	Effect on the Financial Statements or Other Significant Matters
Improvements to Employee Share-Based Payment Accounting	This guidance is intended to simplify several aspects of the accounting for share-based payment award transactions. It will require all income tax effects of awards to be recorded through the income statement when they vest or settle as opposed to certain amounts being recorded in additional paid-in capital. An entity will also have to elect whether to account for forfeitures as they occur or by estimating the number of awards expected to be forfeited and adjusting the estimate when it is likely to change (as currently required). The guidance will also increase the amount an employer can withhold to cover income taxes on awards. Early adoption is permitted.	January 1, 2017	We are currently evaluating the implications of adoption on our consolidated financial statements and considering whether to early adopt the standard.
Revenue from Contracts with Customers	The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: identify the contract(s) with a customer; identify the performance obligations in the contract; determine the transaction price; allocate the transaction price to the performance obligations in the contract; and recognize revenue when (or as) the entity satisfies a performance obligation. This guidance allows for two adoption methods, full retrospective approach or modified retrospective approach. Early adoption is not permitted.	January 1, 2018	We are currently evaluating the possible adoption methodologies and the implications of adoption on our consolidated financial statements.
Leases	This guidance was issued to increase transparency and comparability among organizations by requiring recognition of lease assets and lease liabilities on the balance sheet and disclosure of key information about leasing arrangements. For leases with a term of 12 months or less, lessees are permitted to make an election to not recognize right-of-use assets and lease liabilities. Upon adoption, lessees will apply the new standard as of the beginning of the earliest comparative period presented in the financial statements, however lessees will be able to exclude leases that expire as of the implementation date. Early adoption is permitted.	January 1, 2019	We are currently evaluating the implications of adoption on our consolidated financial statements and considering whether to early adopt the standard.

Perrigo Company plc - Item 1

Note 1

NOTE 2 – ACQUISITIONS

All of the below acquisitions have been accounted for under the acquisition method of accounting based on our analysis of the acquired inputs and processes, and the related assets acquired and liabilities assumed were recorded at fair value as of the acquisition date.

Fair value estimates are based on a complex series of judgments about future events and rely heavily on estimates and assumptions. The judgments used to determine the estimated fair value assigned to each class of assets acquired and liabilities assumed, as well as asset lives, can materially impact our results of operations.

The effects of all of the acquisitions described below are included in the Condensed Consolidated Financial Statements prospectively from the date of each acquisition. Unless otherwise indicated, acquisition costs incurred were immaterial and were recorded in Administration expense.

Current Year Acquisitions

Tretinoin Product Portfolio

On January 22, 2016 , we acquired a portfolio of generic dosage forms and strengths of Retin-A ^® (tretinoin), a topical prescription acne treatment, from Matawan Pharmaceuticals, LLC, for $416.4 million in cash ("Tretinoin Products"), which further expanded our extended topicals portfolio. We were the authorized generic distributor of these products from 2005 to 2013. Operating results attributable to the acquisition are included within our Prescription Pharmaceuticals ("Rx") segment. The intangible assets acquired included generic product rights valued using the multi-period excess earnings method and assigned a 20 -year useful life, and non-compete agreements valued using the lost income method and assigned a five -year useful life. The goodwill acquired is deductible for tax purposes.

Development-Stage Rx Products

In May 2015, we entered into an agreement with a clinical stage biotechnology company for two specialty pharmaceutical products in development ("Development-Stage Rx Products"). We paid $18.0 million for an option to acquire the two products, which was recorded in Research and Development expense. On March 1, 2016 , to further invest in our specialty Rx portfolio, we exercised the option for both products, which requires us to make contingent payments if we obtain regulatory approval and achieve certain sales milestones. We will also be obligated to make certain royalty payments over periods ranging from seven to ten years from the launch of each product.

We accounted for the option exercise as a business acquisition within our Rx segment, recording in-process research and development assets ("IPR&D") and contingent consideration on the balance sheet. The IPR&D was valued using the multi-period excess earnings method and has an indefinite useful life until such time as the research is completed (at which time it will become a definite-lived intangible asset), or is determined to have no future use (at which time it would be impaired). The contingent consideration is an estimate of the future milestone payments and royalties based on probability-weighted outcomes, sensitivity analysis, and discount rates reflective of the risk involved. The preliminary amount of contingent consideration recognized as of the acquisition date was $24.9 million and is recorded in Other non-current liabilities . The amount is subject to change as the valuation

Perrigo Company plc - Item 1

Note 2

assumptions are refined over the measurement period. Once the purchase accounting has been finalized, the contingent consideration will continue to be updated quarterly to adjust the liability to fair value depending on a number of assumptions, including the competitive landscape and regulatory approvals that may impact future sales of the products.

Purchase Price Allocation of Current Year Acquisitions

The purchase accounting allocations for the Development-Stage Rx Products acquisition and one small product acquisition (included in "All Other" in the table below) are preliminary a nd are based on the valuation information, estimates, and assumptions available at July 2, 2016 . As we finalize the fair value estimate, additional purchase price adjustments may be recorded during the measurement period to contingent consideration and intangible assets.

The below table indicates the purchase price allocation for acquisitions completed in the current year (in millions):



	Tretinoin Products		Development-Stage Rx Products*		All Other ⁽¹⁾ *
Purchase price paid	$	416.4	$	—	$	0.3
Contingent consideration	—		24.9		5.6
Total purchase consideration	$	416.4	$	24.9	$	5.9

Assets acquired:
Inventories	$	1.4	$	—	$	—
Goodwill	1.7		—		—
Definite-lived intangibles :
Developed product technology, formulations, and product rights	411.0		—		—
Non-compete agreements	2.3		—		—
Indefinite-lived intangibles :
In-process research and development	—		24.9		5.9
Total intangible assets	413.3		24.9		5.9
Total assets	$	416.4	$	24.9	$	5.9

* Opening balance sheet is preliminary


(1)	Consists of one product acquisition in the CHC segment

Prior Year Acquisitions

Entocort ^®

On December 15, 2015 , we completed our acquisition of Entocort ^® (budesonide) capsules, as well as the authorized generic capsules, for sale within the U.S., from AstraZeneca plc for $380.2 million in cash. Entocort ^® is a gastroenterology medicine for patients with mild to moderate Crohn's disease and the acquisition complemented our Rx portfolio. Operating results attributable to the acquisition are included within our Rx segment. The intangible assets acquired included the branded and authorized generic product rights with useful lives of 10 and 15 years, respectively, which were valued using the multi-period excess earnings method.

Perrigo Company plc - Item 1

Note 2

Naturwohl Pharma GmbH

On September 15, 2015 , we completed our acquisition of 100% of Naturwohl Pharma GmbH ("Naturwohl"), a Munich, Germany-based nutritional business known for its leading German dietary supplement brand, Yokebe ^® . The acquisition built on our Branded Consumer Healthcare ("BCH") segment's OTC product portfolio and European commercial infrastructure. The assets were purchased through an all-cash transaction valued at €133.5 million ( $150.4 million ). Operating results attributable to Naturwohl are included in the BCH segment. The intangible assets acquired included a trademark with a 20 -year useful life, customer relationships with a 15 -year useful life, non-compete agreements with a three -year useful life, and a licensing agreement with a three -year useful life. We utilized the relief from royalty method for valuing the trademark, the multi-period excess earnings method for valuing the customer relationships, and the lost income method for valuing the non-compete agreements and the licensing agreement. The goodwill acquired is not deductible for tax purposes.

ScarAway ^®

On August 28, 2015 , we completed our acquisition of ScarAway ^® , a leading U.S. OTC scar management brand portfolio comprised of five products, from Enaltus, LLC, for $26.7 million in cash. This acquisition served as our entry into the niche branded OTC business in the U.S. Operating results attributable to ScarAway ^® are included in the Consumer Healthcare ("CHC") segment. The intangible assets acquired included a trademark with a 25 -year useful life, non-compete agreements with a four -year useful life, developed product technology with an eight -year useful life, and customer relationships with a 15 -year useful life. We utilized the relief from royalty method for valuing the trademark and developed product technology, the multi-period excess earnings method for valuing the customer relationships, and the lost income method for valuing the non-compete agreements. The goodwill acquired is deductible for tax purposes.

GlaxoSmithKline Consumer Healthcare Product Portfolio

On August 28, 2015 , we completed our acquisition of a portfolio of well-established OTC brands from GlaxoSmithKline Consumer Healthcare (“GSK Products”). This acquisition further leveraged our European market share and expanded our product offerings. The assets were purchased through an all-cash transaction valued at €200.0 million ( $223.6 million ). Operating results attributable to the acquired GSK Products are included primarily in the BCH segment. The intangible assets acquired included trademarks with a 20 -year useful life and customer relationships with a 15 -year useful life. We utilized the relief from royalty method for valuing the trademarks and the multi-period excess earnings method for valuing the customer relationships. The goodwill acquired is deductible for tax purposes and recorded primarily in the BCH segment.

Gelcaps Exportadora de Mexico, S.A. de C.V.

On May 12, 2015 , we completed our acquisition of 100% of Gelcaps Exportadora de Mexico, S.A. de C.V. ("Gelcaps"), the Mexican operations of Durham, North Carolina-based Patheon Inc., for $37.9 million in cash. The acquisition added softgel manufacturing technology to our supply chain capabilities and broadened our presence, product portfolio, and customer network in Mexico. Operating results attributable to Gelcaps are included in the CHC segment. The intangible assets acquired included a trademark with a 25 -year useful life and customer relationships with a 20 -year useful life. We utilized the relief from royalty method for valuing the trademark and the multi-period excess earnings method for valuing the customer relationships.

Based on valuation estimates utilizing the comparative sales method, a step-up in the value of inventory of $0.6 million was recorded in the opening balance sheet, which was charged to cost of goods sold during the three months ended June 27, 2015. In addition, property, plant and equipment were written up by $0.9 million to their estimated fair market value based on a valuation method that included both the cost and market approaches. This additional step-up in value is being depreciated over the estimated remaining useful lives of the assets. The goodwill recorded is not deductible for tax purposes.

Omega Pharma Invest N.V.

On March 30, 2015 , we completed our acquisition of Omega Pharma Invest N.V. ("Omega"), a limited liability company incorporated under the laws of Belgium. Omega was a leading European OTC company and is

Perrigo Company plc - Item 1

Note 2

providing us several key benefits, including advancing our growth strategy outside the U.S. by providing access across a larger global platform with critical mass in key European countries, establishing commercial infrastructure in the high barrier-to-entry European OTC marketplace, strengthening our product portfolio while enhancing scale and distribution, and expanding our international management capabilities.

We purchased 95.77% of the issued and outstanding share capital of Omega ( 685,348,257 shares) from Alychlo N.V. (“Alychlo”) and Holdco I BE N.V. (together with Alychlo, the “Sellers”), limited liability companies incorporated under the laws of Belgium, under the terms of the Share Purchase Agreement dated November 6, 2014 (the "Share Purchase Agreement"). Omega holds the remaining 30,243,983 shares as treasury shares.

The acquisition was a cash and stock transaction made up of the following consideration (in millions except per share data):



Perrigo ordinary shares issued	5.4
Perrigo per share price at transaction close on March 30, 2015	$	167.64
Total value of Perrigo ordinary shares issued	$	904.9
Cash consideration	2,078.3
Total consideration	$	2,983.2

The cash consideration shown in the above table was financed by a combination of debt and equity. We issued $1.6 billion of debt as described in Note 10 , and issued 6.8 million ordinary shares, which raised $999.3 million , net of issuance costs.

The Sellers agreed to indemnify us for certain potential future losses. The Sellers’ indemnification and other obligations to us under the Share Purchase Agreement are secured up to €248.0 million ( $277.0 million ). Under the terms of the Share Purchase Agreement, Alychlo and its affiliates are subject to a three -year non-compete in Europe, and the Sellers are subject to a two -year non-solicit, in each case subject to certain exceptions. The Share Purchase Agreement contains other customary representations, warranties, and covenants of the parties thereto.

The operating results attributable to Omega are included in the BCH segment. We incurred general transaction costs (legal, banking and other professional fees), financing fees, and debt extinguishment charges in connection with the Omega acquisition. The amounts recorded were not allocated to a reporting segment. The table below details the acquisition costs, as well as losses on hedging activities associated with the acquisition purchase price, and where they were recorded for the three and six months ended June 27, 2015 (in millions):



	Three Months Ended		Six Months Ended
Line item	June 27, 2015
Administration	$	16.1	$	18.1
Interest expense, net	—		18.7
Other expense, net	—		258.2
Total acquisition-related costs	$	16.1	$	295.0

See Note 8 for further details on losses on the Omega-related hedging activities shown above in Other expense, net, and Note 10 for details on the loss on extinguishment of debt.

Perrigo Company plc - Item 1

Note 2

We acquired the following intangible assets: indefinite-lived brands, a definite-lived trade name with an eight -year useful life, definite-lived brands with a 22 -year useful life, a distribution network with a 21 -year useful life, and developed product technology with useful lives ranging from four to 13 years. We also recorded goodwill, which is not deductible for tax purposes and represents the value we assigned to the expected synergies described above, in our BCH segment. We utilized the multi-period excess earnings method to value the indefinite-lived brands, the definite-lived brands, and distribution network. We utilized the relief from royalty method to value the developed product technology and definite-lived trade name. The weighted-average useful life of all intangible assets acquired is 20.6 years.

Based on valuation estimates utilizing the comparative sales method, a step-up in the value of inventory of $15.1 million was recorded in the opening balance sheet and was charged to cost of goods sold during the three months ended June 27, 2015. In addition, property, plant and equipment were written up $41.5 million to their estimated fair market value based on a valuation method that included both the cost and market approaches. This additional step-up in value is being depreciated over the estimated remaining useful lives of the assets. Additionally, the fair value of the debt assumed on the date of acquisition exceeded par value by $101.9 million , which was recorded as part of the carrying value of the underlying debt and will be amortized as a reduction of interest expense over the remaining terms of the respective debt instruments. For more information on the debt we assumed from Omega and our subsequent payments on the debt, see Note 10 .

Purchase Price Allocation of Prior Year Acquisitions

The purchase accounting allocations for the Entocort ^® and GSK Products acquisitions were finalized during the three months ended April 2, 2016. Changes to the allocations were due to adjustments to the intangible asset valuation assumptions. The purchase accounting for all other prior year acquisitions was final as of December 31, 2015 . The Omega opening balance sheet adjustments made in connection with the restatement described in Note 1 are included in the balances below. The restatement adjustments impacting the Omega purchase accounting were due primarily to the BCH Belgium Distribution Contracts and taxes. See Note 1 for further detail on the restatement.

Perrigo Company plc - Item 1

Note 2

The below table indicates the purchase price allocation for acquisitions completed during the year ended December 31, 2015 (in millions):



	Entocort ^®		Naturwohl		ScarAway ^®		GSK Products		Gelcaps		Omega* Restated		All Other ⁽¹⁾
Purchase price paid	$	380.2	$	150.4	$	26.7	$	223.6	$	37.9	$	2,983.2	$	15.3
Contingent consideration	—		—		—		—		—		—		13.9
Total purchase consideration	$	380.2	$	150.4	$	26.7	$	223.6	$	37.9	$	2,983.2	$	29.2

Assets acquired:
Cash and cash equivalents	$	—	$	4.6	$	—	$	—	$	4.6	$	14.7	$	—
Accounts receivable	—		3.3		—		—		7.3		222.9		—
Inventories	0.2		1.5		1.0		—		7.2		277.0		—
Prepaid expenses and other current assets	—		—		—		—		2.1		51.2		—
Property, plant and equipment	—		—		—		—		6.0		130.8		—
Goodwill	—		61.0		3.5		32.6		6.0		1,688.7		—
Definite-lived intangibles :
Distribution and license agreements, supply agreements	—		21.4		—		—		—		—		—
Developed product technology, formulations, and product rights	380.0		—		0.5		—		—		31.4		—
Customer relationships and distribution networks	—		25.9		9.8		61.5		6.6		1,056.3		—
Trademarks, trade names, and brands	—		64.2		11.4		129.5		—		287.5		—
Non-compete agreements	—		0.3		0.5		—		—		—		—
Indefinite-lived intangibles :
Trademarks, trade names, and brands	—		—		—		—		4.4		2,003.8		—
In-process research and development	—		—		—		—		—		—		29.2
Total intangible assets	380.0		111.8		22.2		191.0		11.0		3,379.0		29.2
Other non-current assets	—		—		—		—		0.4		2.4		—
Total assets	380.2		182.2		26.7		223.6		44.6		5,766.7		29.2
Liabilities assumed:
Accounts payable	—		2.8		—		—		3.3		225.0		—
Short-term debt	—		—		—		—		—		112.6		—
Accrued liabilities	—		1.6		—		—		1.6		49.3		—
Payroll and related taxes	—		—		—		—		—		51.3		—
Accrued customer programs	—		—		—		—		—		28.9		—
Long-term debt	—		—		—		—		—		1,471.0		—
Net deferred income tax liabilities	—		27.4		—		—		1.4		785.5		—
Other non-current liabilities	—		—		—		—		0.4		59.9		—
Total liabilities	—		31.8		—		—		6.7		2,783.5		—
Net assets acquired	$	380.2	$	150.4	$	26.7	$	223.6	$	37.9	$	2,983.2	$	29.2


⁽¹⁾	Consists of eight product acquisitions in the CHC, BCH, and Rx segments

* Includes opening balance sheet adjustments made as part of the restatement described in Note 1.

Perrigo Company plc - Item 1

Note 2

Actual and Unaudited Pro Forma Impact of Acquisitions

Our Condensed Consolidated Financial Statements include operating results from the acquisitions of the Tretinoin Products, Entocort ^® , Naturwohl, GSK Products, ScarAway ^® , Omega, and Gelcaps, and two small product acquisitions (included in "All Other" in the above table) from the date of each acquisition through July 2, 2016 . Net sales and operating income attributable to acquisitions completed in the current year and included in our financial statements totaled $13.4 million and $7.5 million , respectively, for the three months ended July 2, 2016 and totaled $29.2 million and $18.9 million , respectively, for the six months ended July 2, 2016 .

The following unaudited pro forma information gives effect to the acquisitions of the Tretinoin Products, Entocort ^® , Naturwohl, GSK Products, ScarAway ^® , Omega, and Gelcaps, and two small product acquisitions, as if the acquisitions had occurred on the first day of the six months ended June 27, 2015 and had been included in our Results of Operations for all periods presented thereafter (in millions):



	Three Months Ended					Six Months Ended
	July 2, 2016			June 27, 2015		July 2, 2016			June 27, 2015
(Unaudited)	Restated			Restated		Restated			Restated
Net sales	$	1,340.5		$	1,511.5	$	2,691.1		$	2,807.0
Net income (loss)	$	(534.3	)	$	8.7	$	(1,062.0	)	$	6.0

The historical consolidated financial information of Perrigo, and the Tretinoin Products, Entocort ^® , Naturwohl, GSK Products, ScarAway ^® , Omega, and Gelcaps acquisitions, and two small product acquisitions, has been adjusted in the pro forma information to give effect to pro forma events that are (1) directly attributable to the transactions, (2) factually supportable and (3) expected to have a continuing impact on combined results. In order to reflect the occurrence of the acquisitions on the first day of the six months ended June 27, 2015 as required, the unaudited pro forma results include adjustments to reflect the incremental amortization expense to be incurred based on the current values of each acquisition's identifiable intangible and tangible assets, along with the reclassification of acquisition-related costs from the six months ended July 2, 2016 to the six months ended June 27, 2015 . The unaudited pro forma results do not reflect future events that have occurred or may occur after the acquisitions.

NOTE 3 – GOODWILL AND OTHER INTANGIBLE ASSETS

Goodwill

Changes in the carrying amount of goodwill, by reportable segment, were as follows (in millions):



	December 31, 2015		Business acquisitions		Purchase accounting adjustments		Impairments			Changes in assets held for sale		Currency translation adjustment			July 2, 2016
Reporting Segments:	Restated		Restated		Restated		Restated			Restated		Restated			Restated
CHC	$	1,890.0	$	—	$	—	$	—		$	4.5	$	(5.7	)	$	1,888.8
BCH	1,769.4		—		0.7		(130.5		)	—		52.0			1,691.6
Rx	1,222.2		1.7		—		—			—		(13.0		)	1,210.9
Specialty Sciences	199.6		—		—		—			—		—			199.6
Other	71.5		—		—		—			7.2		0.9			79.6
Total goodwill	$	5,152.7	$	1.7	$	0.7	$	(130.5	)	$	11.7	$	34.2		$	5,070.5

In connection with the preparation of our financial statements for the three-month period ended April 2, 2016, we identified indicators of goodwill impairment in our BCH - rest of world (“BCH - ROW”) reporting unit, which comprises primarily operations attributable to the Omega acquisition in all geographic regions except for Belgium. The primary impairment indicators included the decline in our 2016 performance expectations and a reduction in our long-range revenue growth forecast. Step one of the goodwill impairment test involved determining the fair value of the reporting unit using a discounted cash flow technique and comparing it to the reporting unit’s carrying value. The main assumptions supporting the cash flow projections used to determine the reporting unit’s fair value included

Perrigo Company plc - Item 1

Note 3

revenue growth based on product line extensions, product life cycle strategies, and geographical expansion within the markets in which the reporting unit distributes products, gross margins consistent with historical trends, and advertising and promotion investments largely consistent with the reporting unit's growth plans. The BCH-ROW reporting unit did not pass step one of goodwill impairment testing. The change in fair value from previous estimates was due primarily to the changes in the market and performance of the brands such that the evaluation of brand prioritization and product extensions or launches in new regions are being more focused to maximize the potential of all brands in the segment's portfolio.

The second step of the goodwill impairment test required that we determine the implied fair value of the BCH - ROW reporting unit’s goodwill, which involved determining the value of the reporting unit’s individual assets and liabilities. Based on our estimates of the fair values of the assets and liabilities and the deficit of the fair value when compared to the related book value, we recorded an impairment charge of $130.5 million in Impairment charges (credits) on the Condensed Consolidated Statements of Operations for the three months ended April 2, 2016.

While no impairment charges were recorded as a result of the goodwill impairment testing for the transition period of June 28, 2015 to December 31, 2015 , our Specialty Sciences reporting unit's fair value exceeded the carrying value by less than 10%. Management evaluated the primary source of cash flow in this segment, the Tysabri ^® royalty stream, based on a combination of factors including independent external research, information provided from our royalty partner, and internal estimates. Based on this information, management’s assessment of future cash flow from this royalty stream has been reduced primarily due to anticipated new competitors entering the market and unfavorable currency exchange effects. Future performance different from the assumptions utilized in our quantitative analysis may further reduce the fair value of the reporting unit, which may result in the fair value no longer exceeding the carrying value. In February 2016, a competitor’s pipeline product, Ocrevus ^® , received breakthrough therapy designation from the FDA and in June 2016 the FDA granted priority review with target action date in December 2016. Although the product has not launched, industry analysts believe that based on released clinical study information and the recent announcements, Ocrevus ^® will favorably compete against Tysabri ^® in the relapsing, remitting multiple sclerosis market segment due to its high efficacy and convenient dosage form. The product will compete with Tysabri ^® and could have a significant negative impact on the royalty we receive from Biogen Idec Inc. ("Biogen") and the performance of the Specialty Sciences segment. We continue to monitor the progress of all potential competing products and assess the reporting unit for potential impairment should impairment indicators arise, as applicable, and at least annually during our fourth quarter impairment testing.

During the three months ended June 27, 2015 , we performed our annual goodwill impairment testing, which indicated that our CHC Mexico reporting unit's goodwill fair value was below its net book value as of March 28, 2015. As a result, we initiated the second step of the goodwill impairment test to measure the amount of impairment. We concluded that the goodwill was fully impaired and recorded an impairment of $6.8 million in the CHC segment during the three months ended June 27, 2015 in Impairment charges.

Perrigo Company plc - Item 1

Note 3

Intangible Assets

Other intangible assets and related accumulated amortization consisted of the following (in millions):



	July 2, 2016				December 31, 2015
	Restated				Restated
	Gross		Accumulated Amortization		Gross		Accumulated Amortization
Definite-lived intangibles :
Distribution and license agreements, supply agreements	$	245.7	$	96.5	$	242.4	$	77.7
Developed product technology, formulations, and product rights	1,788.9		492.1		1,387.6		426.0
Customer relationships and distribution networks	1,545.7		256.6		1,520.7		193.0
Trademarks, trade names, and brands	911.4		42.6		539.4		22.8
Non-compete agreements	14.6		10.9		15.2		12.7
Total definite-lived intangibles	$	4,506.3	$	898.7	$	3,705.3	$	732.2
Indefinite-lived intangibles :
Trademarks, trade names, and brands	$	1,288.4	$	—	$	1,868.1	$	—
In-process research and development	66.9		—		48.2		—
Total indefinite-lived intangibles	1,355.3		—		1,916.3		—
Total other intangible assets	$	5,861.6	$	898.7	$	5,621.6	$	732.2

Certain intangible assets are denominated in currencies other than the U.S. dollar; therefore, their gross and accumulated amortization balances are subject to foreign currency movements.

We recorded amortization expense of $88.9 million and $70.1 million for the three months ended July 2, 2016 and June 27, 2015 , respectively, and $174.1 million and $105.3 million for the six months ended July 2, 2016 and June 27, 2015 , respectively. The increase in amortization expense for the 2016 six-month period was due primarily to the incremental amortization expense incurred on the definite-lived intangible assets acquired from Omega.

During our impairment testing for the transition period of June 28, 2015 to December 31, 2015 , we identified an impairment of certain indefinite-lived intangible assets purchased in conjunction with the Omega acquisition based on management’s expectations of the prospects for future revenues, profits, and cash flows associated with these assets. The assessment resulted in an impairment charge of $185.1 million within our BCH segment, which represented the difference between the carrying amount of the intangible assets and their estimated fair value. See our Transition Report on Form 10-KT filed on February 25, 2016 for a further discussion of this impairment charge.

In connection with the preparation of our financial statements for the three-month period ended April 2, 2016, we identified indicators of impairment associated with certain indefinite-lived intangible assets acquired in conjunction with the Omega acquisition. The primary impairment indicators included the decline in our 2016 performance expectations and a reduction in our long-range revenue growth forecast. The assessment utilized the excess earnings method to determine fair value and resulted in an impairment charge of $273.4 million in Impairment charges (credits) on the Condensed Consolidated Statements of Operations within our BCH segment, which represented the difference between the carrying amount of the intangible assets and their estimated fair value. The change in fair value from previous estimates was due primarily to the changes in the market and performance of the brands such that the evaluation of brand prioritization and product extensions or launches in new regions are being more focused to maximize the potential of all brands in the segment's portfolio. The main assumptions supporting the fair value of these assets and cash flow projections included revenue growth based on product line extensions, product life cycle strategies, and geographical expansion within the markets in which the BCH segment distributes products, gross margins consistent with historical trends, and advertising and promotion investments largely consistent with the segment's growth plans.

Perrigo Company plc - Item 1

Note 3

The carrying value for certain intangible assets and goodwill equals estimated and implied fair values, respectively, and as a result, any further deterioration in those assets' fair value would lead to a further impairment charge. Future performance different from the assumptions utilized in our quantitative analyses may result in additional changes in the fair value. We will continue to monitor and assess these assets for potential impairment should further impairment indicators arise, as applicable, and at least annually during our fourth quarter annual impairment testing.

In addition, due to the reprioritization of certain brands in the BCH segment and change in performance expectations for our impaired lifestyle brands previously recorded as indefinite-lived assets, we reclassified the remaining asset balance of $364.5 million to definite-lived assets with a useful life of 20 years and began amortizing the asset during the three months ended July 2, 2016.

NOTE 4 - ACCOUNTS RECEIVABLE FACTORING

We have multiple accounts receivable factoring arrangements with non-related third-party financial institutions (the “Factors”). Pursuant to the terms of the arrangements, we sell to the Factors certain of our accounts receivable balances on a non-recourse basis for credit approved accounts. An administrative fee ranging from 0.14% to 0.15% per invoice is charged on the gross amount of accounts receivables assigned to the Factors, plus interest is calculated at the applicable EUR LIBOR rate plus 70 basis points. The total amount factored on a non-recourse basis and excluded from accounts receivable was $54.7 million and $64.5 million at July 2, 2016 and December 31, 2015 , respectively.

NOTE 5 – INVENTORIES

Major components of inventory were as follows (in millions):



	July 2, 2016		December 31, 2015
	July 2, 2016		Restated
Finished goods	$	523.4	$	537.2
Work in process	148.6		151.6
Raw materials	222.6		209.9
Total inventories	$	894.6	$	898.7

NOTE 6 – FAIR VALUE MEASUREMENTS

Fair value is the price that would be received upon sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The following fair value hierarchy is used in selecting inputs, with the highest priority given to Level 1, as these are the most transparent or reliable.


Level 1:	Quoted prices for identical instruments in active markets.


Level 2:	Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that are not active; and model-derived valuations in which all significant inputs are observable in active markets.


Level 3:	Valuations derived from valuation techniques in which one or more significant inputs are not observable.

Perrigo Company plc - Item 1

Note 6

The following table summarizes the valuation of our financial instruments carried at fair value and measured at fair value on a recurring basis by the above pricing categories (in millions):



		Fair Value
	Fair Value Hierarchy	July 2, 2016		December 31, 2015
Measured at fair value on a recurring basis:
Assets:
Investment securities	Level 1	$	40.0	$	14.9

Foreign currency forward contracts	Level 2	$	4.3	$	4.8
Funds associated with Israeli post-employment benefits	Level 2	16.3		17.2
Total level 2 assets		$	20.6	$	22.0

Tysabri ^® royalty stream - at fair value (restated)	Level 3	$	4,020.0	$	5,310.0

Liabilities:
Interest rate swap agreements	Level 2	$	—	$	0.3
Foreign currency forward contracts	Level 2	2.8		3.9
Total level 2 liabilities		$	2.8	$	4.2

Contingent consideration	Level 3	$	44.9	$	17.9

Measured at fair value on a non-recurring basis:
Assets:
Indefinite-lived intangible assets	Level 3	$	—	$	1,031.8
Assets held for sale, net	Level 3	70.1		37.5
Total level 3 assets		$	70.1	$	1,069.3

There were no transfers between Level 1, 2, and 3 during the three and six months ended July 2, 2016 and June 27, 2015 . Our policy regarding the recording of transfers between levels is to record any such transfers at the end of the reporting period. See Note 7 for information on our investment securities. See Note 8 for a discussion of derivatives.

Funds Associated with Israel Severance Liability

Israeli post-employment benefits represent amounts we have deposited in funds managed by financial institutions designated by management to cover post-employment benefits for our Israeli employees as required by Israeli law. The funds are recorded in Other non-current assets and values are determined using prices for recently traded financial instruments with similar underlying terms, as well as directly or indirectly observable inputs, such as interest rates and yield curves, that are observable at commonly quoted intervals.

Tysabri ^® Royalty Stream - at Fair Value

On December 18, 2013 , we acquired Elan, which had a royalty agreement with Biogen Idec Inc. ("Biogen"), whereby Biogen conveyed the right to receive royalties that are typically payable on sales revenue generated by the sale, distribution or other use of the drug Tysabri ^® . Pursuant to the royalty agreement, we were entitled to royalty payments from Biogen based on its Tysabri ^® sales in all indications and geographies. We received royalties of 12% on worldwide Biogen sales of Tysabri ^® from December 18, 2013 through April 30, 2014. From May 1, 2014, we received royalties of 18% on annual worldwide Biogen sales of Tysabri ^® up to $2.0 billion and 25% on annual sales above $2.0 billion .

We are accounting for the Tysabri ^® royalty stream as a financial asset and have elected to use the fair value option model. We made the election to account for the Tysabri ^® financial asset using the fair value option as we

Perrigo Company plc - Item 1

Note 6

believe this method is most appropriate for an asset that does not have a par value, a stated interest stream, or a termination date. The financial asset acquired represents a single unit of accounting. The fair value of the financial asset acquired was determined by using a discounted cash flow analysis related to the expected probability weighted future cash flows to be generated by the royalty stream. The financial asset is classified as a Level 3 asset within the fair value hierarchy, as our valuation utilized significant unobservable inputs, including industry analyst estimates for global Tysabri ^® sales, probability weighted as to the timing and amount of future cash flows along with certain discount rate assumptions. Cash flow forecasts included the estimated effect and timing of future competition, considering patents in effect for Tysabri ^® through 2024 and contractual rights to receive cash flows into perpetuity. The discounted cash flows are based upon the expected royalty stream forecasted into perpetuity using a 20 -year discrete period with a declining rate terminal value. At July 2, 2016 and December 31, 2015, the pre-tax discount rate utilized was 7.52% and 7.72% , respectively. Significant judgment is required in selecting appropriate discount rates.

In February 2016, a competitor’s pipeline product, Ocrevus ^® , received breakthrough therapy designation from the FDA. Breakthrough therapy designation is when a drug intended alone or in combination with one or more other drugs to treat a serious or life threatening disease or condition and preliminary clinical evidence indicates that the drug may demonstrate substantial improvement over existing therapies on one or more clinically significant endpoints, such as substantial treatment effects observed early in clinical development. In June 2016 the FDA granted priority review with target action date in December 2016. A priority review is a designation when the FDA will direct overall attention and resources to the evaluation of applications for drugs that, if approved, would be significant improvements in the safety or effectiveness of the treatment, diagnosis, or prevention of serious conditions when compared to standard applications. Although the product has not launched, industry analysts believe that based on released clinical study information and the recent announcement, Ocrevus ^® could favorably compete against Tysabri ^® in the relapsing, remitting multiple sclerosis market segment due to its high efficacy and convenient dosage form. Given the new market information for Ocrevus ^® , using industry analyst estimates we reduced our first ten year growth forecast from an average of approximately 3.4% in the fourth calendar quarter of 2015 to approximately growth of 1.8% and a decline of minus 0.4% in the first and second calendar quarters of 2016, respectively, which had the effect of reducing cumulative cash flows over the ten year period by approximately 3.0% and 18.0% compared to the fourth quarter of calendar 2015, respectively. These effects, combined with the change in discount rate, resulted in a reduction in fair value of $1.1 billion in the first six months of 2016.

At July 2, 2016 and December 31, 2015, an evaluation was performed to assess the rate and general market conditions potentially affecting the fair value. As of July 2, 2016 if this discount rate had increased or decreased by 0.5% , the fair value of the asset would have decreased by $190.0 million or increased by $200.0 million , respectively. As of December 31, 2015 had this discount rate increased or decreased by 0.5% , the fair value of the asset would have decreased by $260.0 million or increased by $270.0 million , respectively. The estimated fair value of the asset is subject to variation should those cash flows vary significantly from those estimates. Quarterly, we assess the expected future cash flows and to the extent such payments are greater or less than initial estimates, or the timing of such payments is materially different than the original estimates, we will adjust the estimated fair value of the asset. As of July 2, 2016 if the expected royalty cash flows used in the estimation process had increased or decreased by 5.0% , the fair value of the asset would have increased by $200.0 million or decreased by $210.0 million , respectively. As of December 31, 2015 if the expected royalty cash flows used in the estimation process increased or decreased by 5.0% , the fair value of the asset would have increased by $270.0 million or decreased by $280.0 million , respectively.

In addition, included in our accounts receivable balance was $89.2 million and $83.4 million related to our Tysabri ^® royalty stream at July 2, 2016 and December 31, 2015, respectively.

The following table summarizes the change in our Condensed Consolidated Balance Sheet for the royalty rights and our fair value adjustment that is a Level 3 measurement under ASC 820, which is included in our Condensed Consolidated Statement of Operations for the six months ended July 2, 2016 and the six months ended December 31, 2015 (in millions):

Perrigo Company plc - Item 1

Note 6



	Six Months Ended			Six Months Ended
	July 2, 2016			December 31, 2015
Tysabri ^® royalty stream - at fair value
Beginning balance	$	5,310.0		$	5,420.0
Royalties earned	(174.7		)	(167.3		)
Change in fair value	(1,115.3		)	57.3
Ending balance	$	4,020.0		$	5,310.0

Contingent Consideration

Contingent consideration represents milestone payment obligations obtained through product acquisitions, which are valued using estimates based on probability-weighted outcomes, sensitivity analysis, and discount rates reflective of the risk involved. The estimates are updated quarterly and the liabilities are adjusted to fair value depending on a number of assumptions, including the competitive landscape and regulatory approvals that may impact the future sales of a product.

The table below presents a reconciliation for liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (in millions). Net realized losses in the table were recorded in Administrative expense.



	Three Months Ended						Six Months Ended
	July 2, 2016			June 27, 2015			July 2, 2016			June 27, 2015
Contingent consideration
Beginning balance:	$	48.0		$	12.4		$	17.9		$	12.4
Net realized (gains) losses	(0.1		)	0.9			—			0.9
Purchases or additions	1.0			—			30.5			—
Impairments	(3.8		)	(13.3		)	(3.8		)	(13.3		)
Foreign currency effect	(0.2		)	—			0.3			—
Ending balance:	$	44.9		$	—		$	44.9		$	—

Non-Recurring Fair Value Measurements

The non-recurring fair values represent only those assets whose carrying values were adjusted to fair value during the reporting period. See Note 3 for a more detailed discussion of the impaired goodwill and indefinite-lived intangible assets and the valuation methods used, and Note 9 for information on the impaired assets held for sale, net.

Fixed Rate Long-Term Debt

As of July 2, 2016 and December 31, 2015 , our fixed rate long-term debt consisted of public bonds, a private placement note, and retail bonds. As of July 2, 2016 , the public bonds and private placement note had a carrying value of $5.1 billion and a fair value of $5.2 billion , based on quoted market prices (Level 1). As of December 31, 2015 , the public bonds and private placement note had a carrying value of $3.9 billion and fair value of $3.8 billion , based on quoted market prices (Level 1). As of July 2, 2016 , our retail bonds had a carrying value of $818.6 million (excluding a premium of $67.5 million ) and a fair value of $885.3 million . As of December 31, 2015 , our retail bonds had a carrying value of $798.3 million (excluding a premium of $82.5 million ) and a fair value of $859.8 million . The fair value of our related bonds for both periods was based on interest rates offered for borrowings of a similar nature and remaining maturities (Level 2).

The carrying amounts of our other financial instruments, consisting of cash and cash equivalents, accounts receivable, accounts payable, short-term debt and variable rate long-term debt, approximate their fair value.

Perrigo Company plc - Item 1

Note 7

NOTE 7 – INVESTMENTS

Available for Sale Securities

Our available for sale securities are reported in Prepaid expenses and other current assets . Unrealized investment gains (losses) on available for sale securities were as follows (in millions):



	July 2, 2016		December 31, 2015
Equity securities, at cost less impairments	$	20.2	$	6.4
Gross unrealized gains	19.8		9.3
Gross unrealized losses	—		(0.8		)
Estimated fair value of equity securities	$	40.0	$	14.9

The factors affecting the assessment of impairments include both general financial market conditions and factors specific to a particular company. We recorded impairment charges of $1.7 million related to other-than-temporary impairments of our marketable equity securities during the three months ended July 2, 2016 due to prolonged losses incurred on each of the investments.

Cost Method Investments

Our cost method investments totaled $7.0 million and $6.9 million at July 2, 2016 and December 31, 2015 , respectively, and are included in Other non-current assets .

Equity Method Investments

Our equity method investments totaled $4.8 million and $45.5 million at July 2, 2016 and December 31, 2015 , respectively, and are included in Other non-current assets . We recorded a net loss of $1.6 million and $3.9 million during the three and six months ended July 2, 2016 , respectively, and a net loss of $5.0 million and $5.3 million during the three and six months ended June 27, 2015 , respectively, for our proportionate share of the equity method investment earnings or losses. The losses were recorded in Other expense, net.

In addition, due to significant and prolonged losses incurred on one of our equity method investments, we recorded a $22.3 million impairment in Other expense, net, during the three months ended July 2, 2016 .

During the six months ended July 2, 2016 , one of our equity method investments became publicly traded. As a result, we transferred the $15.5 million investment to available for sale and recorded an $8.7 million unrealized gain, net of tax, in Other Comprehensive Income ("OCI"), as reflected in the table above.

NOTE 8 – DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

We enter into certain derivative financial instruments, when available on a cost-effective basis, to mitigate our risk associated with changes in interest rates and foreign currency exchange rates as follows:

Interest rate risk management - We are exposed to the impact of interest rate changes through our cash investments and borrowings. We utilize a variety of strategies to manage the impact of changes in interest rates including using a mix of debt maturities along with both fixed-rate and variable-rate debt. In addition, we may enter into treasury-lock agreements and interest rate swap agreements on certain investing and borrowing transactions to manage our exposure to interest rate changes and our overall cost of borrowing.

Foreign currency exchange risk management - We conduct business in several major currencies other than the U.S. dollar and are subject to risks associated with changing foreign exchange rates. Our objective is to reduce cash flow volatility associated with foreign exchange rate changes on a consolidated basis to allow management to focus its attention on business operations. Accordingly, we enter into various contracts that change in value as foreign exchange rates change to protect the value of existing foreign currency assets and liabilities, commitments, and anticipated foreign currency sales and expenses.

Perrigo Company plc - Item 1

Note 8

All derivative instruments are managed on a consolidated basis to efficiently net exposures and thus take advantage of any natural offsets. Gains and losses related to the derivative instruments are expected to be offset largely by gains and losses on the original underlying asset or liability. We do not use derivative financial instruments for speculative purposes.

All of our designated derivatives were classified as cash flow hedges as of July 2, 2016 and December 31, 2015 . Designated derivatives meet hedge accounting criteria, which means the fair value of the hedge is recorded in shareholders’ equity as a component of OCI, net of tax. The deferred gains and losses are recognized in income in the period in which the hedged item affects earnings. Any ineffective portion of the change in fair value of the derivative is immediately recognized in earnings. All of our designated derivatives are assessed for hedge effectiveness quarterly.

We also have economic non-designated derivatives that do not meet hedge accounting criteria. These derivative instruments are adjusted to current market value at the end of each period through earnings. Gains or losses on these instruments are offset substantially by the remeasurement adjustment on the hedged item.

Interest Rate Swaps and Treasury Locks

Interest rate swap agreements are contracts to exchange floating rate for fixed rate payments (or vice versa) over the life of the agreement without the exchange of the underlying notional amounts. The notional amounts of the interest rate swap agreements are used to measure interest to be paid or received and do not represent the amount of exposure to credit loss. The differential paid or received on the interest rate swap agreements is recognized as an adjustment to interest expense.

During the six months ended December 31, 2015 , we entered into a forward interest rate swap to hedge against changes in the benchmark interest rate between the date the interest rate swap was entered into and the date of expected future debt issuance. The interest rate swap was designated as a cash flow hedge and had a notional amount totaling $200.0 million . The interest rate swap was settled upon the issuance of an aggregate $1.2 billion principal amount of senior notes on March 7, 2016 for a cumulative after-tax loss of $7.0 million in OCI during the six months ended July 2, 2016 .

In connection with the Omega acquisition, we assumed a $20.0 million private placement note. We also assumed an interest rate swap agreement with a notional amount totaling $20.0 million that was in place to hedge the cross currency exchange differences between the U.S. dollar and the euro on the above-mentioned debt. On May 29, 2015, we repaid the loan and the interest rate swap. We also assumed €500.0 million ( $544.5 million ) of debt under Omega's revolving credit facility, as well as an interest rate swap agreement with a notional amount of €135.0 million ( $147.0 million ) that was in place to hedge the change in the floating rate on that credit facility. On April 8, 2015, we repaid the loan and terminated the interest rate swap. Because both interest rate swaps mentioned above were recorded at fair market value on the date of termination, no gain or loss was recorded. For more information on the acquired debt and termination, see Note 10 .

During the three months ended June 27, 2015 , we repaid a $300.0 million term loan with floating interest rates priced off the LIBOR yield curve, see Note 10 . As a result of the term loan repayment on June 25, 2015, the forward interest rate swap agreements with notional amounts totaling $240.0 million that were in place to hedge the change in the LIBOR rate were terminated as well. We recorded a loss of $3.6 million in Other expense, net, during the three months ended June 27, 2015 for the amount remaining in Accumulated Other Comprehensive Income (Loss) ("AOCI") when the hedges were terminated.

Foreign Currency Derivatives

We enter into foreign currency forward contracts, both designated and non-designated, in order to manage the impact of foreign exchange fluctuations on expected future purchases and related payables denominated in a foreign currency, as well as to hedge the impact of foreign exchange fluctuations on expected future sales and related receivables, and future royalties denominated in a foreign currency. Both types of forward contracts have a maximum maturity date of 15 months. The total notional amount for these contracts was $500.4 million and $755.5 million as of July 2, 2016 and December 31, 2015 , respectively.

Perrigo Company plc - Item 1

Note 8

In order to economically hedge the foreign currency exposure associated with the planned payment of the euro-denominated purchase price of Omega, we entered into non-designated forward contracts that matured during the three months ended March 28, 2015. We recorded losses of $259.8 million during the three months ended March 28, 2015 related to the settlement of the forward contracts in Other expense, net. The losses on the derivatives due to changes in the euro-to-U.S. dollar exchange rates were economically offset at closing in the final settlement of the euro-denominated Omega purchase price. In June 2015, in order to economically hedge the foreign currency exposure associated with the planned payment of the euro-denominated GSK Products acquisition discussed in Note 2 , we entered into a non-designated option contract to protect against a strengthening of the euro relative to the U.S. dollar. We recorded losses of $1.9 million for the change in fair value of the option contract during the three months ended June 27, 2015 in Other expense, net. Because these derivatives were economically hedging future acquisitions, the cash outflows associated with their settlement are shown as investing activity on the Condensed Consolidated Statements of Cash Flows.

Effects of Derivatives on the Financial Statements

The below tables indicate the effects of all derivative instruments on the Condensed Consolidated Financial Statements. All amounts exclude income tax effects and are presented in millions.

The balance sheet location and gross fair value of our outstanding derivative instruments were as follows:



	Asset Derivatives
	Balance Sheet Location	Fair Value
		July 2, 2016		December 31, 2015
Designated derivatives:
Foreign currency forward contracts	Other current assets	$	2.6	$	3.8
Total designated derivatives		$	2.6	$	3.8
Non-designated derivatives:
Foreign currency forward contracts	Other current assets	$	1.7	$	1.0
Total non-designated derivatives		$	1.7	$	1.0



	Liability Derivatives
	Balance Sheet Location	Fair Value
		July 2, 2016		December 31, 2015
Designated derivatives:
Foreign currency forward contracts	Accrued liabilities	$	1.0	$	2.0
Interest rate swap agreements	Other non-current liabilities	—		0.3
Total designated derivatives		$	1.0	$	2.3
Non-designated derivatives:
Foreign currency forward contracts	Accrued liabilities	$	1.8	$	1.9
Total non-designated derivatives		$	1.8	$	1.9

The gains (losses) recognized in OCI for the effective portion of our designated cash flow hedges were as follows:



	Amount of Gain/(Loss) Recorded in OCI (Effective Portion)
	Three Months Ended						Six Months Ended
Designated Cash Flow Hedges	July 2, 2016			June 27, 2015			July 2, 2016			June 27, 2015
Interest rate swap agreements	$	—		$	(14.0	)	$	(9.0	)	$	(12.0	)
Foreign currency forward contracts	(0.3		)	2.7			1.3			(1.1		)
Total	$	(0.3	)	$	(11.3	)	$	(7.7	)	$	(13.1	)

Perrigo Company plc - Item 1

Note 8

The gains (losses) reclassified from AOCI into earnings for the effective portion of our designated cash flow hedges were as follows:



		Amount of Gain/(Loss) Reclassified from AOCI to Income (Effective Portion)
		Three Months Ended						Six Months Ended
Designated Cash Flow Hedges	Income Statement Location	July 2, 2016			June 27, 2015			July 2, 2016			June 27, 2015
Treasury locks	Interest expense, net	$	—		$	(0.1	)	$	—		$	(0.1	)
Interest rate swap agreements	Interest expense, net	(0.6		)	(19.1		)	(1.1		)	(18.2		)
Foreign currency forward contracts	Net sales (restated)	(0.1		)	2.7			0.4			1.8
	Cost of sales	0.6			(1.8		)	0.9			(4.6		)
	Interest expense, net	(0.6		)	—			(0.9		)	—
	Other expense, net (restated)	1.7			(0.9		)	1.9			(0.4		)
Total		$	1.0		$	(19.2	)	$	1.2		$	(21.5	)

The net of tax amount expected to be reclassified out of AOCI into earnings during the next 12 months is a $1.0 million loss .

The gains (losses) recognized against earnings for the ineffective portion of our designated cash flow hedges were as follows:



		Amount of Gain/(Loss) Recognized in Income (Ineffective Portion)
		Three Months Ended					Six Months Ended
Designated Cash Flow Hedges	Income Statement Location	July 2, 2016			June 27, 2015		July 2, 2016			June 27, 2015
Interest rate swap agreements	Other expense, net	$	—		$	—	$	(0.1	)	$	—
Foreign currency forward contracts	Net sales (restated)	(0.1		)	—		0.1			(0.3		)
	Cost of sales	(0.1		)	0.1		—			0.1
	Other expense, net (restated)	0.6			—		0.6			—
Total		$	0.4		$	0.1	$	0.6		$	(0.2	)

The effects of our non-designated derivatives on the Condensed Consolidated Statements of Operations were as follows:



		Amount of Gain/(Loss) Recognized in Income
		Three Months Ended						Six Months Ended
Non-Designated Derivatives	Income Statement Location	July 2, 2016			June 27, 2015			July 2, 2016			June 27, 2015
Foreign currency forward contracts	Other expense, net	$	(1.6	)	$	5.2		$	(8.5	)	$	(250.5	)
	Interest expense, net	(0.6		)	(1.0		)	(0.5		)	(3.5		)
Total		$	(2.2	)	$	4.2		$	(9.0	)	$	(254.0	)

NOTE 9 – ASSETS HELD FOR SALE

During the six months ended December 31, 2015 , management committed to a plan to sell our U.S. Vitamins, Minerals, and Supplements ("VMS") and India Active Pharmaceutical Ingredients ("API") businesses. The VMS business is reported in our CHC segment and the API business is reported in our Other segment. When a group of assets is classified as held for sale, the book value is evaluated and adjusted to the lower of its carrying amount or fair value less cost to sell. At December 31, 2015, we determined that the carrying value of the India API business exceeded its fair value less cost to sell, resulting in an impairment charge of $29.0 million . During the three months ended July 2, 2016 , we recorded an additional impairment charge to the India API business of

Perrigo Company plc - Item 1

Note 9

$4.3 million . In addition, during the three months ended July 2, 2016 , we determined that the carrying value of the U.S. VMS business exceeded its fair value less cost to sell, resulting in an impairment charge of $6.2 million .

Assets and liabilities associated with the U.S. VMS and India API held for sale businesses were classified as held for sale at July 2, 2016 and December 31, 2015 . The assets held for sale were reported within Prepaid expenses and other current assets and liabilities held for sale were reported in Accrued liabilities . The amounts consisted of the following (in millions):



	July 2, 2016						December 31, 2015
	CHC			Other			CHC		Other
Assets held for sale
Current assets	$	59.4		$	6.8		$	55.1	$	13.6
Goodwill	8.5			7.3			13.0		14.5
Property, plant and equipment	18.9			34.0			18.8		37.4
Other assets	0.9			3.2			—		3.2
Less: impairment reserves	(6.2		)	(32.5		)	—		(29.0		)
Total assets held for sale	$	81.5		$	18.8		$	86.9	$	39.7
Liabilities held for sale
Current liabilities	$	27.0		$	1.1		$	30.5	$	0.5
Other liabilities	—			2.1			—		1.7
Total liabilities held for sale	$	27.0		$	3.2		$	30.5	$	2.2

Perrigo Company plc - Item 1

Note 10

NOTE 10 – INDEBTEDNESS

Total borrowings outstanding are summarized as follows (in millions):



				July 2, 2016			December 31, 2015
Revolving credit agreements
	2015 Revolver			$	—		$	380.0
	2014 Revolver			—			300.0
	Total revolving credit agreements			—			680.0
Term loans
*	2014 Term loan due December 5, 2019			473.3			488.8
Notes and Bonds
	Coupon	Due
	1.300%	November 8, 2016	⁽²⁾	500.0			500.0
*	4.500%	May 23, 2017	⁽³⁾	200.5			195.5
*	5.125%	December 12, 2017	⁽³⁾	334.1			325.8
	2.300%	November 8, 2018	⁽²⁾	600.0			600.0
*	5.000%	May 23, 2019	⁽³⁾	133.6			130.3
	3.500%	March 15, 2021	⁽⁴⁾	500.0			—
	3.500%	December 15, 2021	⁽¹⁾	500.0			500.0
*	5.105%	July 19, 2023	⁽³⁾	150.4			146.7
	4.000%	November 15, 2023	⁽²⁾	800.0			800.0
	3.900%	December 15, 2024	⁽¹⁾	700.0			700.0
	4.375%	March 15, 2026	⁽⁴⁾	700.0			—
	5.300%	November 15, 2043	⁽²⁾	400.0			400.0
	4.900%	December 15, 2044	⁽¹⁾	400.0			400.0
	Total notes and bonds			5,918.6			4,698.3
Other financing (restated)				4.6			128.2
Unamortized premium (discount), net				49.5			73.4
Deferred financing fees				(35.4		)	(36.6		)
Total borrowings outstanding				6,410.6			6,032.1
	Current indebtedness (restated)			(758.1		)	(1,060.5		)
Total long-term debt less current portion				$	5,652.5		$	4,971.6


(1)	Discussed below collectively as the "2014 Notes."


(2)	Discussed below collectively as the "2013 Notes."


(3)	Debt assumed from Omega.


(4)	Discussed below collectively as the "2016 Notes."


*	Debt denominated in euros subject to fluctuations in the euro-to-U.S. dollar exchange rate.

On April 25, 2017, the lenders under our 2014 Revolver and 2014 Term Loan waived any default or event of default that may arise from any restatement of or deficiencies in our financial statements for the periods specified in such waivers, including the quarter ended July 2, 2016. No default or event of default existed prior to receipt of these waivers. We are in compliance with all covenants under the 2014 Revolver and the 2014 Term Loan as of the date of this Form 10-Q/A.

Revolving Credit Agreements

On December 9, 2015 , our 100% owned finance subsidiary, Perrigo Finance Unlimited Company (formerly Perrigo Finance plc) ("Perrigo Finance"), entered into a $750.0 million revolving credit agreement (the "2015 Revolver"). On March 15, 2016, we used the proceeds of the long-term debt issuance described below under "2016 Notes" to repay the $750.0 million then outstanding under the 2015 Revolver and terminated the facility.

Perrigo Company plc - Item 1

Note 10

On March 30, 2015 , we assumed a revolving credit facility with €500.0 million ( $544.5 million ) outstanding from Omega. On April 8, 2015 , the €500.0 million ( $539.1 million ) outstanding under the assumed revolving credit facility was repaid and the facility was terminated.

On December 5, 2014 , Perrigo Finance entered into a $600.0 million revolving credit agreement, which we increased to $1.0 billion on March 30, 2015 (the "2014 Revolver"). On March 15, 2016, we used the proceeds of the long-term debt issuance described below under "2016 Notes" to repay the $435.0 million then outstanding under the 2014 Revolver. There were no borrowings outstanding under the 2014 Revolver as of July 2, 2016 .

Term Loans

On December 5, 2014 , Perrigo Finance entered into a term loan agreement consisting of a €500.0 million ( $614.3 million ) tranche, with the ability to draw an additional €300.0 million ( $368.6 million ) tranche, maturing December 5, 2019, and we entered into a $300.0 million term loan tranche maturing December 18, 2015, which we repaid in full on June 25, 2015. During the six months ended July 2, 2016 , we made $27.9 million in scheduled principal payments on the euro-denominated term loan.

Notes and Bonds

2016 Notes

On March 7, 2016 , Perrigo Finance issued $500.0 million in aggregate principal amount of 3.500% senior notes due 2021 and $700.0 million in aggregate principal amount of 4.375% senior notes due 2026 (together, the "2016 Notes") and received net proceeds of $1.2 billion after fees and market discount. Interest on the 2016 Notes is payable semiannually in arrears in March and September of each year, beginning in September 2016. The 2016 Notes are governed by a base indenture and a second supplemental indenture. The 2016 Notes are fully and unconditionally guaranteed on a senior basis by Perrigo, and no other subsidiary of Perrigo guarantees the 2016 Notes. The proceeds were used to repay amounts borrowed under the 2015 Revolver and the 2014 Revolver, as mentioned above. There are no restrictions under the 2016 Notes on our ability to obtain funds from our subsidiaries. Perrigo Finance may redeem the 2016 Notes in whole or in part at any time for cash at the make-whole redemption prices described in the 2016 Notes.

Notes and Bonds Assumed from Omega

In connection with the Omega acquisition, on March 30, 2015 , we assumed:


•	$20.0 million in aggregate principal amount of 6.19% senior notes due 2016 , which was repaid on May 29, 2015 in full;


•	€135.0 million ( $147.0 million ) in aggregate principal amount of 5.1045% senior notes due 2023 (the "2023 Notes");


•	€300.0 million ( $326.7 million ) in aggregate principal amount of 5.125% retail bonds due 2017 ; €180.0 million ( $196.0 million ) in aggregate principal amount of 4.500% retail bonds due 2017 ; and €120.0 million ( $130.7 million ) in aggregate principal amount of 5.000% retail bonds due 2019 (collectively, the "Retail Bonds").

The fair value of the 2023 Notes and Retail Bonds exceeded par value by €93.6 million ( $101.9 million ) on the date of the Omega acquisition. As a result, a fair value adjustment was recorded as part of the carrying value of the underlying debt and will be amortized as a reduction of interest expense over the remaining terms of the respective debt instruments. The adjustment does not affect cash interest payments.

2014 Notes

On December 2, 2014 , Perrigo Finance issued $500.0 million in aggregate principal amount of 3.500% senior notes due 2021 (the "2021 Notes”), $700.0 million in aggregate principal amount of 3.900% senior notes due 2024 (the “2024 Notes”), and $400.0 million in aggregate principal amount of 4.900% senior notes due 2044 (the “2044 Notes” and, together with the 2021 Notes and the 2024 Notes, the “2014 Notes”) and received net proceeds

Perrigo Company plc - Item 1

Note 10

of $1.6 billion after fees and market discount. Interest on the 2014 Notes is payable semiannually in arrears in June and December of each year, beginning in June 2015. The 2014 Notes are governed by a base indenture and a first supplemental indenture. The 2014 Notes are fully and unconditionally guaranteed on a senior unsecured basis by Perrigo, and no other subsidiary of Perrigo guarantees the 2014 Notes. There are no restrictions under the 2014 Notes on our ability to obtain funds from our subsidiaries. Perrigo Finance may redeem the 2014 Notes in whole or in part at any time for cash at the make-whole redemption prices described in the 2014 Notes.

2013 Notes

On November 8, 2013, Perrigo Company issued $500.0 million aggregate principal amount of its 1.300% senior notes due 2016 (the " 1.300% 2016 Notes"), $600.0 million aggregate principal amount of its 2.300% senior notes due 2018 (the "2018 Notes"), $800.0 million aggregate principal amount of its 4.000% senior notes due 2023 (the " 4.000% 2023 Notes") and $400.0 million aggregate principal amount of its 5.300% senior notes due 2043 (the "2043 Notes" and, together with the 1.300% 2016 Notes, the 2018 Notes and the 4.000% 2023 Notes, the "2013 Notes") in a private placement with registration rights. We received net proceeds of $2.3 billion from the issuance of the 2013 Notes after fees and market discount. We plan to prepay the 1.300% 2016 Notes in September 2016. See Part II, Item 5 .

Interest on the 2013 Notes is payable semiannually in arrears in May and November of each year, beginning in May 2014. The 2013 Notes are governed by a base indenture and a first supplemental indenture (collectively, the "2013 Indenture"). The 2013 Notes are our unsecured and unsubordinated obligations, ranking equally in right of payment to all of our existing and future unsecured and unsubordinated indebtedness. The 2013 Notes are not entitled to mandatory redemption or sinking fund payments. We may redeem the 2013 Notes in whole or in part at any time for cash at the make-whole redemption prices described in the 2013 Indenture. The 2013 Notes were guaranteed on an unsubordinated, unsecured basis by the same entities that guaranteed our then-outstanding credit agreement until November 21, 2014, at which time the 2013 Indenture was amended to remove all guarantors.

Other Financing

Overdraft Facilities

On March 30, 2015 , we assumed and repaid certain overdraft facilities totaling €51.4 million ( $56.0 million ) with the Omega acquisition. Our BCH segment uses overdraft facilities to increase the efficiency of its cash utilization and meet its short-term liquidity needs. We repaid the balance outstanding under these overdraft facilities during the three months ended July 2, 2016, but retain the ability to use these facilities in our day-to-day cash operations. The balance outstanding under the facilities was $82.9 million at December 31, 2015 and is shown in the above table under "Other Financing".

Obligations Resulting from Recourse Factoring

In conjunction with the restatement related to BCH Belgium Distribution Contracts we have included the obligations due to the factors related to recourse amounts factored in Other Financing. The recourse contracts were discontinued during 2016 and no balance remains outstanding at July 2, 2016. The balance outstanding and due to the factor was $42.2 million at December 31, 2015 .

Perrigo Company plc - Item 1

Note 11

NOTE 11 – EARNINGS PER SHARE AND SHAREHOLDERS' EQUITY

Earnings per Share

A reconciliation of the numerators and denominators used in the basic and diluted earnings per share ("EPS") calculation is as follows (in millions):



	Three Months Ended						Six Months Ended
	July 2, 2016			June 27, 2015			July 2, 2016			June 27, 2015
	Restated			Restated			Restated			Restated
Numerator:
Net loss	$	(534.3	)	$	(22.2	)	$	(1,063.5	)	$	(44.5	)

Denominator:
Weighted average shares outstanding for basic EPS	143.2			146.3			143.2			143.5
Dilutive effect of share-based awards*	—			—			—			—
Weighted average shares outstanding for diluted EPS	143.2			146.3			143.2			143.5

Anti-dilutive share-based awards excluded from computation of diluted EPS*	—			—			—			—

* In the period of a net loss, diluted shares equal basic shares.

Shareholders' Equity

We issued 19,000 and 57,000 shares related to the exercise and vesting of share-based compensation during the three months ended July 2, 2016 and June 27, 2015 , respectively. We issued 98,000 and 92,000 shares related to the exercise and vesting of share-based compensation during the six months ended July 2, 2016 and June 27, 2015 , respectively.

Share Repurchases

NOTE 12 – ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Changes in our AOCI balances, net of tax were as follows (in millions):



	Foreign currency translation adjustments			Fair value of derivative financial instruments, net of tax			Fair value of investment securities, net of tax		Post-retirement and pension liability adjustments, net of tax			Total AOCI
Balance at December 31, 2015 (restated)	$	(4.6	)	$	(14.2	)	$	6.4	$	(2.9	)	$	(15.3	)
OCI before reclassifications (restated)	43.9			(5.6		)	7.2		0.6			46.1
Amounts reclassified from AOCI	—			(1.4		)	1.3		—			(0.1		)
Other comprehensive income (loss) (restated)	43.9			(7.0		)	8.5		0.6			46.0
Balance at July 2, 2016 (restated)	$	39.3		$	(21.2	)	$	14.9	$	(2.3	)	$	30.7

Perrigo Company plc - Item 1

Note 13

NOTE 13 – INCOME TAXES

The effective tax rate for the three months ended July 2, 2016 was a benefit of 34.2% on a net loss compared to expense of 136.8% for the three months ended June 27, 2015 . The effective tax rate for the six months ended July 2, 2016 was a benefit of 18.3% on a net loss reported in the period compared to 188.5% on income for the six months ended June 27, 2015.

Our tax rate is subject to adjustment over the balance of the prior fiscal year ended due to, among other things: income tax rate changes by governments; the jurisdictions in which our profits are determined to be earned and taxed; changes in the valuation of our deferred tax assets and liabilities; adjustments to estimated taxes upon finalization of various tax returns; adjustments to our interpretation of transfer pricing standards; changes in available tax credits, grants and other incentives; changes in stock-based compensation expense; changes in tax laws or the interpretation of such tax laws (for example, proposals for fundamental U.S. international tax reform); changes in U.S. GAAP; expiration of or the inability to renew tax rulings or tax holiday incentives; and the repatriation of earnings with respect to which we have not previously provided for taxes.

Israel passed legislation in January 2016, effective immediately, reducing the tax rate from 26.5% to 25% . The impact on our effective tax rate was minimal.

The total liability for uncertain tax positions was $371.7 million and $340.3 million as of July 2, 2016 and December 31, 2015 , respectively, before considering the federal tax benefit of certain state and local items.

We recognize interest and penalties related to uncertain tax positions as a component of income tax expense. The total amount accrued for interest and penalties in the liability for uncertain tax positions was $60.7 million and $52.1 million as of July 2, 2016 and December 31, 2015 , respectively.

We file income tax returns in numerous jurisdictions and are therefore subject to audits by tax authorities. Our primary income tax jurisdictions are Ireland, the U.S., Israel, Belgium, France, and the U.K.

Although we believe that the tax estimates are reasonable and that we prepare our tax filings in accordance with all applicable tax laws, the final determination with respect to any tax audit and any related litigation could be materially different from estimates or from historical income tax provisions and accruals. The results of an audit or litigation could have a material effect on our operating results and/or cash flows in the periods for which that determination is made. In addition, future period earnings may be adversely impacted by litigation costs, settlements, penalties, and/or interest assessments.

The IRS audit of our fiscal years ended June 27, 2009 and June 26, 2010 had previously concluded with the issuance of a statutory notice of deficiency on August 27, 2014. While we had previously agreed on certain adjustments and made associated payments of $8.0 million , inclusive of interest in November 2014, the statutory notice of deficiency asserted various additional positions, including transfer pricing, relative to the same audit of fiscal years ended June 27, 2009 and June 26, 2010. The statutory notice asserted an incremental tax obligation of approximately $68.9 million , inclusive of interest and penalties. We disagree with the IRS’s positions asserted in the notice of deficiency. In January 2015, we paid this amount, a prerequisite to being able to contest the IRS’s positions in U.S. Federal court, and in June 2015, we filed a request for a refund. The IRS denied our request for a refund. We anticipate filing a complaint in federal district court claiming a refund for these amounts in the first quarter of 2017. The payment was recorded during the three months ended March 28, 2015 as a deferred charge on the balance sheet given our anticipated action to recover this amount. An unfavorable resolution of this matter could have a material impact on our consolidated financial statements in future periods.

We have ongoing audits in multiple jurisdictions for which tax returns are not yet settled. These jurisdictions include, but are not limited to, the United States and Belgium. The IRS is auditing our fiscal years ended June 25, 2011 and June 30, 2012, and may make adjustments consistent with their claims for the 2009 - 2010 audit period. In February 2016, the Belgium Tax Authority notified us that all Belgium locations will be audited for the years ended December 31, 2013 and December 31, 2014. At this time, we cannot predict the outcome of any audit or related litigation.

Perrigo Company plc - Item 1

Note 14

NOTE 14 – COMMITMENTS AND CONTINGENCIES

In view of the inherent difficulties of predicting the outcome of various types of legal proceedings, we cannot determine the ultimate resolution of the matters described below. We establish reserves for litigation and regulatory matters when losses associated with the claims become probable and the amounts can be reasonably estimated. The actual costs of resolving legal matters may be substantially higher or lower than the amounts reserved for those matters. For matters where the likelihood or extent of a loss is not probable or cannot be reasonably be estimated as of July 2, 2016 , we have not recorded a loss reserve. If certain of these matters are determined against us, it could have a material adverse effect on our financial condition, results of operations, or cash flows. We currently believe we have valid defenses to the claims in these lawsuits and intend to defend these lawsuits vigorously regardless of whether or not we have a loss reserve. Other than what is disclosed below, we do not expect the outcome of the litigation matters to which we are currently subject to, individually or in the aggregate, have a material adverse effect on our financial condition, results of operations, or cash flows.

Securities Litigation

On May 18, 2016, a shareholder filed a securities case against the Company and our former CEO, Joseph Papa, in the District of New Jersey ( Roofers’ Pension Fund v. Papa, et al.) . The plaintiff purports to represent a class of shareholders for the period from April 21, 2015 through May 11, 2016, inclusive. The complaint alleges violations of Securities Exchange Act sections 10(b) (and Rule 10b‑5) and 14(e) against both defendants and 20(a) control person liability against Mr. Papa. In general, the allegations concern the actions taken by us and the former executive to defend against the hostile takeover bid by Mylan in the period from April 21, 2015 through November 13, 2015. The plaintiff also alleges that we provided inadequate disclosure concerning alleged integration problems related to the Omega acquisition in the period from April 21, 2015 through May 11, 2016. The case is in an early stage. Four different plaintiff groups have sought appointment as lead plaintiff/lead counsel. The court will decide in the near term who will represent the purported class. Once the court has chosen a lead plaintiff, the plaintiff will likely file an amended complaint and the defendants will then have an opportunity to make a motion to dismiss the case.

A substantially similar case making virtually the same allegations for the same class period against the same defendants was filed in the Southern District of New York on June 21, 2016 ( AMI - Gov’t Employees Provident Fund Mgmt Co. v. Papa, et al.) . The plaintiff in the AMI case voluntarily dismissed its action on July 12, 2016.

On May 22, 2016, shareholders filed a securities class action against us and five individual defendants Mr. Papa, our former Executive Vice President and General Manager of the BCH segment Marc Coucke, our Chief Executive Officer John Hendrickson and our Board members Gary Kunkle, Jr. and Laurie Brlas alleging violations of Israeli law in the District Court of Tel Aviv-Jaffa ( Schwieger et al. v. Perrigo Company plc, et al.). On June 15, 2016, Perrigo filed a motion to stay the case pending the outcome of the securities class action pending in the New Jersey federal court. The plaintiffs did not oppose the motion. The Israeli court granted the motion on the same day, and the action is stayed.

Eltroxin

During October and November 2011, nine applications to certify a class action lawsuit were filed in various courts in Israel related to Eltroxin, a prescription thyroid medication manufactured by a third party and distributed in Israel by our subsidiary, Perrigo Israel Agencies Ltd. The respondents included our subsidiaries, Perrigo Israel Pharmaceuticals Ltd. and/or Perrigo Israel Agencies Ltd., the manufacturers of the product, and various healthcare providers who provide healthcare services as part of the compulsory healthcare system in Israel.

One of the applications was dismissed and the remaining eight applications were consolidated into one application. The applications arose from the 2011 launch of a reformulated version of Eltroxin in Israel. The consolidated application generally alleges that the respondents: (a) failed to timely inform patients, pharmacists and physicians about the change in the formulation; and (b) failed to inform physicians about the need to monitor patients taking the new formulation in order to confirm patients were receiving the appropriate dose of the drug. As a result, claimants allege they incurred the following damages: (a) purchases of product that otherwise would not have been made by patients had they been aware of the reformulation; (b) adverse events to some patients

Perrigo Company plc - Item 1

Note 14

resulting from an imbalance of thyroid functions that could have been avoided; and (c) harm resulting from the patients' lack of informed consent prior to the use of the reformulation.

Several hearings on whether or not to certify the consolidated application took place in December 2013 and January 2014. On May 17, 2015, the District Court certified the motion against Perrigo Israel Agencies Ltd. and dismissed it against the remaining respondents, including Perrigo Israel Pharmaceuticals Ltd.

On June 16, 2015, Perrigo submitted a motion for permission to appeal the decision to certify to the Israeli Supreme Court together with a motion to stay the proceedings of the class action until the motion for permission to appeal is adjudicated. Perrigo has filed its statement of defense to the underlying proceedings and the underlying proceedings have been stayed pending a decision on the motion to appeal. The hearing on Perrigo’s motion to appeal the decision to certify the class action was held on July 11, 2016. At this stage, we cannot reasonably predict the outcome or the liability, if any, associated with this claim.

Tysabri ^® Product Liability Lawsuits

Perrigo and collaborator Biogen are co-defendants in product liability lawsuits arising out of the occurrence of Progressive Multifocal Leukoencephalopathy, a serious brain infection, and serious adverse events, including deaths, which occurred in patients taking Tysabri ^® . Perrigo and Biogen will each be responsible for 50% of losses and expenses arising out of any Tysabri ^® product liability claims. While these lawsuits will be vigorously defended, management cannot predict how these cases will be resolved. Adverse results in one or more of these lawsuits could result in substantial judgments against us.

NOTE 15 – COLLABORATION AGREEMENTS AND OTHER CONTRACTUAL ARRANGEMENTS

In May 2015, we entered into a development agreement wherein we transferred the ownership rights to two pharmaceutical products to a clinical stage development company to fund and conduct development activities for the products. We do not expect to incur any expense related to the development of either product. If the products are approved by the FDA, we will execute a buy-back agreement to purchase each product for a multiple of the development costs incurred. Based on the initial development budget for each product, the estimated purchase price for both products is approximately $78.0 million . If development costs exceed the initial budgeted amounts, the purchase price will increase but will not exceed approximately $105.0 million . If the products are approved by the FDA and we purchase the products, we estimate the acquisitions will occur in 2019 and 2020.

In June 2016, we added an additional product to the May 2015 development agreement that is subject to similar buy-back terms if the product is approved by the FDA. The estimated purchase price for this additional product, based on the initial development budget, is approximately $42.0 million . If development costs exceed the initial budgeted amounts, the purchase price will increase, but will not exceed approximately $57.0 million . If the product is approved by the FDA and we purchase the product, we estimate the acquisition will occur in 2020. There can be no assurance that any such products will be approved by the FDA on the anticipated schedule or at all.

NOTE 16 – RESTRUCTURING CHARGES

We periodically take action to reduce redundant expenses and improve operating efficiencies, typically in connection with business acquisitions. The following reflects our restructuring activity (in millions):



	Three Months Ended						Six Months Ended
	July 2, 2016			June 27, 2015			July 2, 2016			June 27, 2015
Beginning balance	$	13.0		$	3.6		$	20.7		$	3.2
Additional charges	5.8			(0.1		)	11.3			1.0
Payments	(6.6		)	(1.9		)	(24.8		)	(2.6		)
Non-cash adjustments	—			—			5.0			—
Ending balance	$	12.2		$	1.6		$	12.2		$	1.6

Perrigo Company plc - Item 1

Note 16

Restructuring activity includes severance, lease exit costs, and asset impairments. The charges incurred during the three and six months ended July 2, 2016 were primarily associated with actions we took to streamline our organization as announced on October 22, 2015 and did not materially impact any one reportable segment. There were no other material restructuring programs in any of the periods presented. All charges are recorded in Restructuring expense. The remaining $7.0 million liability for employee severance benefits will be paid within the next year, while cash expenditures related to the remaining $5.2 million liability for lease exit costs will be incurred over the remaining terms of the applicable leases.

NOTE 17 – SEGMENT INFORMATION

Our reporting segments are as follows:


•	CHC is focused primarily on the global sale of OTC store brand products including cough, cold, allergy and sinus, analgesic, gastrointestinal, smoking cessation, infant formula and food, VMS, animal health, and diagnostic products.


•	BCH develops, manufactures, markets and distributes many well-known European OTC brands in the natural health and vitamins, cough, cold and allergy, smoking cessation, personal care and derma-therapeutics, lifestyle, and anti-parasite categories.


•	Rx develops, manufactures and markets a portfolio of generic and specialty pharmaceutical prescription drugs primarily for the U.S. and U.K. markets.


•	Specialty Sciences is comprised primarily of royalties received from assets focused on the management of multiple sclerosis (Tysabri ^® ).

We also have an " Other " segment that is comprised of our API business, which does not meet the quantitative threshold required to be a separately reportable segment. Our segments reflect the way in which our chief operating decision maker reviews our operating results and allocates resources.

The below tables show select financial measures by reporting segment (in millions):



	July 2, 2016		December 31, 2015
Total Assets	Restated		Restated
CHC	$	3,748.3	$	3,384.8
BCH	6,290.7		7,083.5
Rx	3,340.1		2,738.0
Specialty Sciences	4,710.1		5,930.2
Other	202.0		213.1
Total	$	18,291.2	$	19,349.6



	Three Months Ended
	July 2, 2016							June 27, 2015
	Restated							Restated
	Total Revenue		Operating Income (Loss)			Intangible Asset Amortization		Total Revenue		Operating Income (Loss)			Intangible Asset Amortization
CHC	$	686.3	$	115.0		$	19.0	$	746.4	$	130.1		$	16.6
BCH	343.1		(1.8		)	39.5		368.3		16.7			34.2
Rx	293.3		96.8			29.9		278.3		99.5			18.6
Specialty Sciences	—		(3.8		)	—		—		(5.2		)	0.2
Other	17.8		(1.3		)	0.5		22.2		1.9			0.5
Unallocated	—		(20.1		)	—		—		(50.7		)	—
Total	$	1,340.5	$	184.8		$	88.9	$	1,415.2	$	192.3		$	70.1

Perrigo Company plc - Item 1

Note 17



	Six Months Ended
	July 2, 2016							June 27, 2015
	Restated							Restated
	Total Revenue		Operating Income (Loss)			Intangible Asset Amortization		Total Revenue		Operating Income (Loss)			Intangible Asset Amortization
CHC	$	1,386.6	$	214.5		$	38.8	$	1,431.3	$	234.4		$	32.8
BCH*	705.9		(400.0		)	74.9		368.3		16.8			34.2
Rx	556.9		191.1			59.4		529.9		199.5			36.9
Specialty Sciences	—		(5.1		)	—		—		(8.5		)	0.5
Other	38.4		4.1			1.0		52.9		12.4			0.9
Unallocated	—		(51.4		)	—		—		(71.9		)	—
Total*	$	2,687.8	$	(46.8	)	$	174.1	$	2,382.4	$	382.7		$	105.3


*	The BCH segment was created on March 30, 2015 as a result of the Omega acquisition, thus data for the six months ended June 27, 2015 includes only three months of results from operations attributable to Omega.

The Specialty Sciences segment recognized expense (income) of $910.8 million and $69.2 million for the three months ended July 2, 2016 and June 27, 2015 , respectively, and $1.1 billion and $(31.5) million for the six months ended July 2, 2016 and June 27, 2015 , respectively, for the change in the fair value of the Tysabri ^® royalty stream during each period.

NOTE 18 – SUBSEQUENT EVENTS

On August 5, 2016 we closed the sale of our U.S. VMS business to International Vitamins Corporation for $61.8 million in cash inclusive of an estimated working capital adjustment. During the three months ended July 2, 2016 we recorded an impairment of $6.2 million to bring the carrying value of the assets held for sale in line with the expected sales price. See Note 9 for more information.

Perrigo Company plc - Item 2

Executive Overview

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

EXECUTIVE OVERVIEW

This Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the financial statements included in this Form 10-Q/A and our Annual Report on Form 10-K for the year ended December 31, 2016 (the “2016 Form 10-K”). These historical financial statements may not be indicative of our future performance. This discussion contains a number of forward-looking statements, all of which are based on our current expectations and could be affected by the uncertainties and risks referred to under “Risk Factors” in Item 1A of our 2016 Form 10-K.

We are a leading global over-the-counter ("OTC") consumer goods and specialty pharmaceutical company, offering patients and customers high quality products at affordable prices. From our beginning in 1887 as a packager of home remedies, we have grown to become the world's largest manufacturer of OTC healthcare products and supplier of infant formulas for the store brand market. We are also a leading provider of generic extended topical prescription products, and we receive royalties from sales of the multiple sclerosis drug Tysabri. ^® We provide “Quality Affordable Healthcare Products ^® ” across a wide variety of product categories and geographies, primarily in North America, Europe, and Australia, as well as in other markets, including Israel, China, and Latin America.

Our reporting segments are as follows:


•	Consumer Healthcare ( "CHC" ) is focused primarily on the global sale of OTC store brand products including cough, cold, allergy and sinus, analgesic, gastrointestinal, smoking cessation, infant formula and food, Vitamins, Minerals and Supplements ("VMS"), animal health, and diagnostic products.


•	Branded Consumer Healthcare ( "BCH" ) develops, manufactures, markets and distributes many well-known European OTC brands in the natural health and vitamins, cough, cold and allergy, smoking cessation, personal care and derma-therapeutics, lifestyle, and anti-parasite categories.


•	Prescription Pharmaceuticals ( "Rx" ) develops, manufactures and markets a portfolio of generic and specialty pharmaceutical prescription drugs primarily for the U.S. and U.K. markets.


•	Specialty Sciences is comprised primarily of royalties received from assets focused on the management of multiple sclerosis (Tysabri ^® ).

We also have an " Other " segment comprised of our our Active Pharmaceutical Ingredients ("API") business, which develops, manufactures, and markets active API used worldwide by both generic and branded pharmaceutical companies. For results by segment, see "Segment Results" below and Item 1. Note 17 .

Restatement

In connection with our year-end financial statement close and preparation of our Annual Report on Form 10-K for 2016, we identified misstatements in our historical financial statements, including for the nine months ended October 1, 2016, six months ended December 31, 2015 , and the years ended June 27, 2015 and June 28, 2014 (the "Restated Periods"). Accordingly, we have restated the Condensed Consolidated Financial Statements for the three and six months ended July 2, 2016 and June 27, 2015 to reflect the correction of the misstatements, the most significant of which are described below. The segments predominantly affected by this restatement are Specialty Sciences and Consumer Healthcare International. Refer to Item 1. Note 10 for additional information on how this restatement affects our debt covenants.

Perrigo Company plc - Item 2

Executive Overview

All of the financial information presented in this Item 2 has been revised to reflect the restatement more fully described in Item 1. Note 1 to the Condensed Consolidated Financial Statements.

Leadership Changes

On July 20, 2016, we appointed John Wesolowski Acting General Manager, Rx Pharmaceuticals, and accepted the resignation of Doug Boothe, Executive Vice President and General Manager, Rx Pharmaceuticals.

On April 27, 2016, Sharon Kochan's role as Executive Vice President and General Manager, International, was expanded to lead the BCH segment following the resignation of Marc Coucke as Executive Vice President and General Manager of the BCH segment.

On April 24, 2016, we named Laurie Brlas as Chairman of the Board of Directors, promoted John T. Hendrickson from President to Chief Executive Officer, and accepted the resignation of Joseph C. Papa as Chairman and Chief Executive Officer.

Perrigo Company plc - Item 2

Executive Overview

2016 Year-to-Date Highlights


•	We closed the sale of our U.S. VMS business to International Vitamins Corporation ("IVC") on August 5, 2016;


•	Consistent with previously announced actions, we added a number of positions and processes to our Dublin headquarters across a range of corporate functions, including supply chain/global operations, procurement, enterprise risk management, and corporate finance, leveraging the strength of our global platform;


•	We continued restructuring associated primarily with actions we took to streamline our organization as announced on October 22, 2015;


•	We issued $1.2 billion of senior notes and repaid borrowings under revolving credit facilities;


•	We issued a notice of redemption to prepay $500.0 million of senior notes in September 2016;


•	We completed the acquisition of a generic Retin-A ^® portfolio, further enhancing our Rx extended topicals strategy; and


•	We completed the acquisition of two development-stage specialty Rx products to further invest in our specialty Rx portfolio.

RESULTS OF OPERATIONS

CONSOLIDATED

Recent Trends and Developments

•

We have experienced a reduction in pricing expectations during 2016 in comparison to historical patterns in our U.S. businesses, in particular in our Rx segment, due to industry and competitive pressures in the sector. The reduced pricing is attributable to a variety of factors including increased focus from customers to capture supply chain productivity savings, low raw material commodity pricing, competition in specific product categories, and the loss of exclusivity on certain products and consolidation of certain customers in the Rx segment. We expect this pricing environment to continue to impact us at least through the remainder of 2016.

•

Our expectations for the BCH segment continue to be impacted by market dynamics in the lifestyle and natural health/vitamins categories. Factors impacting these categories include softness in key markets due to current macro-economic factors, change in timing of certain advertising and promotional campaigns compared to the prior year, and lower sell-in during the current year due to the re-staging of certain products.The BCH segment has established a brand prioritization strategy to address these market dynamics, with an objective to balance the cost of advertising and promotion investments with expected contributions from category sales.

•

Our expectations for 2016 new product sales are consistent with those communicated in our first quarter Form 10-Q, but continue to remain lower than anticipated as of December 31, 2015. Several new product launches have been delayed due to the regulatory approval process for certain new products in the U.S. and modifications to market share penetration and timing assumptions for new products in our Rx and BCH segments.

Interim Impairment Testing

Perrigo Company plc - Item 2

Consolidated

The assessment for indefinite-lived intangible asset impairment utilized the excess earnings method to determine fair value and resulted in an impairment charge of $273.4 million for the three months ended April 2, 2016, which represented the difference between the carrying amount of the intangible assets and their estimated fair value.

The assessment for goodwill impairment indicated that a portion of the goodwill acquired in the Omega acquisition was impaired as the reporting unit's fair value did not exceed its carrying value. Based on our evaluation and estimates of the fair value of the reporting unit, we recorded an impairment charge of $130.5 million for the three months ended April 2, 2016.

For both the intangible assets and goodwill, the change in estimated and implied fair value, respectively, from previous estimates was due primarily to the changes in the market and performance of the brands such that the evaluation of brand prioritization and product extensions or launches in new regions are being more focused to maximize the potential of all brands in the segment's portfolio. Both the indefinite-lived intangible asset impairment and goodwill impairment were recorded within Impairment charges (credits) on the Condensed Consolidated Statements of Operations within our BCH segment. The carrying value for certain intangible assets and goodwill equals fair value, and as a result, any further deterioration in those assets' fair value would lead to a further impairment charge. Future performance different from the assumptions utilized in our quantitative analyses may result in additional changes in the fair value. We will continue to monitor and assess these assets for potential impairment should further impairment indicators arise, as applicable, and at least annually during our fourth quarter annual impairment testing.

See Item 1. Note 3 for more information.

Consolidated Results



	Three Months Ended						Six Months Ended
	June 27, 2015			July 2, 2016			June 27, 2015			July 2, 2016
($ in millions)	Restated			Restated			Restated			Restated
Net sales	$	1,415.2		$	1,340.5		$	2,382.4		$	2,687.8
Gross profit	$	601.0		$	546.5		$	970.4		$	1,079.6
Gross profit %	42.5		%	40.8		%	40.7		%	40.2		%
Operating expenses	$	408.7		$	361.7		$	587.7		$	1,126.4
Operating expenses %	28.9		%	27.0		%	24.7		%	41.9		%
Operating income (loss)	$	192.3		$	184.8		$	382.7		$	(46.8	)
Operating income (loss) %	13.6		%	13.8		%	16.1		%	(1.7		)%
Tysabri ^® royalty stream - change in fair value	$	69.2		$	910.8		$	(31.5	)	$	1,115.3
Interest and other, net	$	62.6		$	86.2		$	364.0		$	140.3
Income tax expense (benefit)	$	82.7		$	(277.9	)	$	94.7		$	(238.9	)
Net loss	$	(22.2	)	$	(534.3	)	$	(44.5	)	$	(1,063.5	)

Perrigo Company plc - Item 2

Consolidated

The decline in consolidated sales for the three months ended July 2, 2016 as compared to the prior year period was due primarily to lower sales in the CHC segment's cough/cold, analgesics, and OTC contract manufacturing categories. This decrease was offset partially by higher sales in the Rx segment due to contributions from acquisitions and new products. Consolidated operating income for the three months ended July 2, 2016 decreased from the prior year period due to lower gross profit resulting primarily from reduced pricing in the Rx segment and product mix in the BCH segment, offset partially by lower operating expenses due in part to cost containment measures.

A significant change in our consolidated six-month year-over-year results is the addition of Omega Pharma Invest N.V. ("Omega"). Omega was acquired on March 30, 2015; thus, results for the six months ended June 27, 2015 included only three months of operations attributable to Omega. The net loss for the six months ended July 2, 2016 was due primarily to goodwill and intangible asset impairment charges totaling $403.9 million , as described above under "Interim Impairment Testing" and in Item 1. Note 3 , and $1.1 billion in charges associated with the change in the fair value of the Tysabri ^® royalty stream (compared to income of $31.5 million in the prior year period) due to changes in the discount rate and cash flow assumptions. See the below section "Tysabri ^® Royalty Stream - Change In Fair Value" and Item 1. Notes 1 and 6 for more information on the change in fair value of the Tysabri ^® royalty stream. The net loss for the prior year period included a $259.8 million loss on derivatives we used to economically hedge fluctuations in the euro-denominated purchase price of the Omega acquisition as described in Item 1. Note 8 .

Further details and analysis of our financial results for the three and six months ended July 2, 2016 and June 27, 2015 are provided below by reporting segment and line item.

CONSUMER HEALTHCARE

Recent Trends and Developments

•

On June 20, 2016, we announced the sale of our U.S. VMS business to IVC, which closed on August 5, 2016. As of July 2, 2016 , the net assets of our U.S. VMS business were classified as "held for sale" as discussed in Item 1. Note 9 . Sales attributable to the U.S. VMS business totaled $42.1 million and $39.6 million for the three months ended July 2, 2016 and June 27, 2015 , respectively, and $89.2 million and $77.1 million for the six months ended July 2, 2016 and June 27, 2015 , respectively.

•

We have experienced a reduction in pricing expectations in certain categories within our CHC segment in 2016 due to various factors, including increased focus from customers to capture supply chain productivity savings, low raw material commodity pricing, and competition in specific product categories. We expect this pricing environment to continue to impact our CHC segment at least through the remainder of 2016.

Perrigo Company plc - Item 2

CHC

Segment Results

Three Month Comparison



	Three Months Ended
	June 27, 2015			July 2, 2016
($ in millions)	Restated			Restated
Net sales	$	746.4		$	686.3
Gross profit	$	251.9		$	234.1
Gross profit %	33.7		%	34.1		%
Operating income	$	130.1		$	115.0
Operating income %	17.4		%	16.8		%

Three Months Ended July 2, 2016 vs. Three Months Ended June 27, 2015

Net sales decreased $60.1 million , or 8% , over the prior year period due to:


•	New product sales of $32.4 million related primarily to several new infant formula and food products and the launches of fluticasone nasal spray (generic equivalent to Flonase ^® ), guaifenesin extended release (generic equivalent to Mucinex ^® ER); and


•	Incremental net sales of $11.4 million from acquisitions (primarily the Gelcaps Exportadora de Mexico, S.A. de C.V. ("Gelcaps") and ScarAway ^® acquisitions); more than offset by


•	A net decrease in sales of existing products of $83.5 million due to:


•	Strong sales in our infant health and smoking cessation categories; more than offset by


•	Weaker sales in the cough/cold category due to timing of promotions and a weaker allergy season;


•	Pricing pressure primarily in the analgesics category due to increased competition; and


•	Lower sales in the OTC contract manufacturing and animal health categories;


•	Discontinued products of $12.0 million due primarily to a label refresh within the infant formula category; and


•	Unfavorable foreign currency movement of $6.0 million .

Perrigo Company plc - Item 2

CHC

Operating income decreased $15.1 million , or 12% , as a result of:


•	A decrease of $17.8 million in gross profit due to:


•	Margin contributions from new products and strong performance in the infant health and smoking cessation categories; and


•	Continued manufacturing and supply chain efficiencies; more than offset by


•	Decreased sales of existing and discontinued products as described above; and


•	Increased intangible asset amortization expense associated primarily with the Gelcaps and ScarAway ^® acquisitions.


•	An increase of $2.7 million in operating expenses due to:


•	A $6.2 million impairment charge recorded on the VMS held-for-sale business; and


•	Increased research and development investments due to timing of clinical trials; offset partially by


•	Decreased selling and administrative expenses due to cost containment actions taken during the prior year; and


•	Absence of a $6.8 million goodwill impairment charge related to our CHC Mexico reporting unit.

Six Month Comparison



	Six Months Ended
	June 27, 2015			July 2, 2016
($ in millions)	Restated			Restated
Net sales	$	1,431.3		$	1,386.6
Gross profit	$	463.8		$	445.0
Gross profit %	32.4		%	32.1		%
Operating income	$	234.4		$	214.5
Operating income %	16.4		%	15.5		%

Six Months Ended July 2, 2016 vs. Six Months Ended June 27, 2015

Net sales decreased $44.7 million , or 3% , over the prior year period due to:


•	New product sales of $63.2 million related primarily to several new infant formula and food products, fluticasone nasal spray (generic equivalent to Flonase ^® ), guaifenesin extended release (generic equivalent to Mucinex ^® ER), and several new animal health products; and


•	Incremental net sales of $24.2 million due primarily to the Gelcaps and ScarAway ^® acquisitions; more than offset by


•	A net $66.1 million decrease in existing product sales due to:


•	Strong sales in our infant health and smoking cessation categories; more than offset by


•	Weaker sales in the cough/cold category due to a mild cold and flu season, weaker allergy season, and timing of promotions;


•	Decreased sales of analgesics due to a mild cold and flu season and pricing pressure due to increased competition; and


•	Lower sales in the OTC contract manufacturing and animal health categories;


•	Discontinued products of $49.9 million related primarily to a label refresh within the infant formula category; and


•	Unfavorable foreign currency movement of $12.6 million .

Perrigo Company plc - Item 2

CHC

Operating income decreased $19.9 million , or 8% , as a result of:


•	A decrease of $18.8 million in gross profit due to:


•	Decreased sales of existing and discontinued products in the first half of 2016 as described above; and


•	Increased intangible asset amortization expense associated primarily with the Gelcaps and ScarAway ^® acquisitions; offset partially by


•	Margin contributions from new products and strong performance in the infant health and smoking cessation categories; and


•	Continued manufacturing and supply chain efficiencies.


•	A decrease of $1.1 million in operating expenses due to:


•	A $6.2 million impairment charge recorded on the VMS held-for-sale business; and


•	Increased research and development investments due to timing of clinical trials; offset partially by


•	Decreased selling and administrative expenses due to cost containment actions taken during the prior year; and


•	Absence of a $6.8 million goodwill impairment charge related to our CHC Mexico reporting unit.

BRANDED CONSUMER HEALTHCARE

Recent Trends and Developments

•


•	Our expectations for 2016 new product sales are consistent with those communicated in our first quarter Form 10-Q, but continue to remain lower than anticipated as of December 31, 2015. Several new product launches have been delayed due to modifications to market share penetration and timing assumptions for new products in Europe.


•	We continue to make progress on our previously announced restructuring plans to right-size the BCH business due to the impact of market dynamics on sales volumes. In addition, we made several strategic leadership changes during 2016, with additional hiring continuing.

Segment Results

Three Month Comparison



	Three Months Ended
	June 27, 2015			July 2, 2016
($ in millions)	Restated			Restated
Net sales	$	368.3		$	343.1
Gross profit	$	180.4		$	165.6
Gross profit %	49.0		%	48.3		%
Operating income (loss)	$	16.7		$	(1.8	)
Operating income (loss) %	4.6		%	(0.5		)%

Perrigo Company plc - Item 2

BCH

Three Months Ended July 2, 2016 vs. Three Months Ended June 27, 2015

Net sales decreased $25.2 million , or 7% , over the prior year period due to:


•	New product sales of $28.3 million ; and


•	Incremental net sales of $29.1 million from the Naturwohl Pharma GmbH ("Naturwohl") and GlaxoSmithKline Consumer Healthcare Product Portfolio ("GSK Products") acquisitions; more than offset by


•	Decreased sales volumes of existing products totaling $82.6 million due primarily to:


•	Weaker current year sales in the lifestyle category due in large part to a product launch in the prior year period and the natural health/vitamins category due primarily to timing of promotional activities and the planned divestment of the Etixx ^® brand; and


•	Lower sales in France due to market dynamics.

Operating income decreased $18.5 million , or 111% , as a result of:


•	A decrease of $14.8 million in gross profit due to decreased sales of existing products in the lifestyle and natural health/vitamins categories as noted above; and


•	An increase of $3.7 million in operating expenses due to:


•	Decreased advertising and promotional investment due to previously announced strategic initiatives to better align promotional investments with sales; offset partially by


•	Restructuring expense totaling $4.8 million in the current quarter related to strategic organizational enhancements.

Six Month Comparison*

* The BCH segment was created on March 30, 2015 as a result of the Omega acquisition, thus comparative prior year data for the six months ended June 27, 2015 includes only three months of results from operations.



	Six Months Ended
	June 27, 2015*			July 2, 2016
($ in millions)	Restated			Restated
Net sales	$	368.3		$	705.9
Gross profit	$	180.4		$	343.7
Gross profit %	49.0		%	48.7		%
Operating income (loss)	$	16.8		$	(400.0	)
Operating income (loss) %	4.6		%	(56.7		)%

Six Months Ended July 2, 2016 vs. Six Months Ended June 27, 2015

Net sales increased $337.6 million , or 92% , over the prior year period due to:


•	An additional three months of results from operations attributable to Omega;


•	New products totaling $59.5 million ; and


•	Sales from the Naturwohl and GSK Products acquisitions totaling $66.7 million ; offset partially by


•	Decreased sales volumes of existing products due primarily to:


•	Weaker current year sales in the lifestyle category due in large part to a product launch in the prior year period and the natural health/vitamins category due primarily to timing of promotional activities and the planned divestment of the Etixx ^® brand; and


•	Lower sales in France due to market dynamics.

Perrigo Company plc - Item 2

BCH

Operating income decreased $416.8 million due to:


•	A $163.3 million increase in gross profit due to an additional three months of operations attributable to Omega; offset by


•	An increase of $580.1 million in operating expenses due to:


•	Intangible asset and goodwill impairment charges totaling $403.9 million recorded during the six months ended July 2, 2016 described above under "Interim Impairment Testing";


•	An additional three months of operations; and


•	Restructuring charges totaling $7.1 million related to strategic organizational enhancements; offset partially by


•	Cost control measures employed to mitigate lower forecasted sales and operating income.

PRESCRIPTION PHARMACEUTICALS

Recent Trends and Developments

•

We continue to experience a significant reduction in pricing expectations in our Rx segment due to industry and competitive pressures in the sector. This softness in pricing is attributed to various factors, including increased focus from customers to capture supply chain productivity savings, low raw material commodity pricing, competition in specific products, and consolidation of certain customers. We expect this softness to continue to impact us at least through the remainder of 2016.


•	On January 22, 2016, we acquired a portfolio of generic dosage forms and strengths of Retin-A ^® (tretinoin), a topical prescription acne treatment, from Matawan Pharmaceuticals, LLC, for $416.4 million in cash ("Tretinoin Products").


•	On March 1, 2016, we completed the acquisition of two development-stage specialty Rx products to further invest in our specialty Rx portfolio.

Segment Results

Three Month Comparison



	Three Months Ended
($ in millions)	June 27, 2015			July 2, 2016
Net sales	$	278.3		$	293.3
Gross profit	$	161.4		$	139.3
Gross profit %	58.0		%	47.5		%
Operating income	$	99.5		$	96.8
Operating income %	35.7		%	33.0		%

Perrigo Company plc - Item 2

Three Months Ended July 2, 2016 vs. Three Months Ended June 27, 2015

Net sales increased $15.0 million , or 5% , due to:


•	Sales attributable to the Entocort ^® and Tretinoin Products acquisitions totaling $43.7 million ; and


•	New product sales of $25.6 million due primarily to sales of benzoyl peroxide 5%-clindamycin 1% gel (a generic version of Benzaclin™); offset partially by


•	Decreased sales of existing products of $50.3 million due to lower sales volume of certain products, pricing pressure across the portfolio, and the lack of exclusive market position for two key products versus the prior year;


•	Discontinued products of $2.8 million ; and


•	Unfavorable foreign exchange movement of $1.1 million .

Segment operating income decreased $2.7 million , or 3% , as a result of:


•	A decrease of $22.1 million in gross profit due primarily to the pricing pressure noted above as well as higher amortization expense from the Entocort ^® and Tretinoin Products acquisitions; offset largely by


•	A decrease of $19.4 million in operating expenses due primarily to the absence of an $18.0 million R&D payment made in connection with a research and development contractual arrangement in the prior year.

Six Month Comparison



	Six Months Ended
	June 27, 2015			July 2, 2016
($ in millions)	June 27, 2015			Restated
Net sales	$	529.9		$	556.9
Gross profit	$	303.1		$	273.5
Gross profit %	57.2		%	49.1		%
Operating income	$	199.5		$	191.1
Operating income %	37.6		%	34.3		%

Six Months Ended July 2, 2016 vs. Six Months Ended June 27, 2015

Net sales increased $27.0 million , or 5% , due to:


•	Net sales attributable to the Entocort ^® and Tretinoin Products acquisitions totaling $89.3 million ; and


•	New product sales of $36.8 million due primarily to to sales of benzoyl peroxide 5%-clindamycin 1% gel (a generic version of Benzaclin™); offset partially by


•	Decreased sales of existing products of $93.5 million due to declined sales volume of certain products, pricing pressure across the portfolio, and the lack of exclusive market position for two key products versus the prior year;


•	Discontinued products of $3.5 million ; and


•	Unfavorable foreign exchange movement of $2.0 million .

Segment operating income decreased $8.4 million , or 4% , as a result of:


•	A decrease of $29.6 million in gross profit due primarily to the pricing pressure noted above, as well as higher amortization expense from the Entocort ^® and Tretinoin Products acquisitions; offset partially by


•	A decrease of $21.2 million in operating expenses due primarily to the absence of an $18.0 million research and development payment made in connection with a research and development contractual arrangement in the prior year.

Perrigo Company plc - Item 2

Specialty Sciences

SPECIALTY SCIENCES

Segment Results

Operating expenses were $3.8 million for the three months ended July 2, 2016, compared to $5.2 million for the prior year period. Operating expenses were $5.1 million for the six months ended July 2, 2016 compared to $8.5 million for the prior year period. The decreases of $1.4 million and $3.4 million were due to a reduction in legal expenses. See the Interest, Other and Royalty Stream (Consolidated) section below for discussions on the Tysabri ^® Royalty Stream change In fair value.

OTHER

Recent Trends and Developments

We are pursuing the sale of our API business based in India and expect the sale to take place during 2016. On July 2, 2016 , the net assets of our India API business were classified as "held for sale" as discussed in Item 1. Note 9.

Segment Results

Three Month Comparison



	Three Months Ended
($ in millions)	June 27, 2015			July 2, 2016
Net sales	$	22.2		$	17.8
Gross profit	$	7.3		$	7.5
Gross profit %	32.8		%	42.4		%
Operating income (loss)	$	1.9		$	(1.3	)
Operating income (loss) %	8.4		%	(7.1		)%

Three Months Ended July 2, 2016 vs. Three Months Ended June 27, 2015

Net sales decreased $4.4 million due primarily to increased competition on certain products, in particular, U.S. sales of Temozolomide. The operating loss in the current year period was due primarily to a $4.3 million impairment charge recorded on the India API held-for-sale business, offset partially by reduced operating expenses.

Six Month Comparison

Perrigo Company plc - Item 2

Other



	Six Months Ended
($ in millions)	June 27, 2015			July 2, 2016
Net sales	$	52.9		$	38.4
Gross profit	$	23.1		$	17.4
Gross profit %	43.6		%	45.3		%
Operating income	$	12.4		$	4.1
Operating income %	23.3		%	10.8		%

Six Months Ended July 2, 2016 vs. Six Months Ended June 27, 2015

Net sales decreased $14.5 million due primarily to competition on certain products, in particular, U.S. sales of Temozolomide. Operating income decreased $8.3 million due primarily to a $5.7 million decrease in gross profit due to increased competition, and a $4.3 million impairment charge recorded on the India API held-for-sale business, offset partially by a reduction in operating expenses.

Unallocated Expenses

Unallocated expenses are comprised of certain corporate expenses not allocated to the segments and are recorded in operating income. Unallocated expenses were $20.1 million for the three months ended July 2, 2016 , compared to $50.7 million for the three months ended June 27, 2015 , a decrease of $30.6 million . The reduction in unallocated expense was due primarily to fees incurred in the prior year period: $16.1 million of Omega acquisition-related fees and $13.4 million of fees related to our defense against the hostile takeover bid by Mylan N.V. ("Mylan"). In addition, we experienced a $15.0 million year-over-year reduction in share-based compensation due primarily to the resignation of Joseph C. Papa, which was offset by a $12.8 million increase in legal and professional fees in the current period.

Unallocated expenses were $51.4 million for the six months ended July 2, 2016 compared to $71.9 million for the prior year period, a decrease of $20.5 million . The reduction in unallocated expense was due primarily to fees incurred in the prior year period: $18.1 million of Omega acquisition-related fees and $13.4 million of legal and professional fees related to our defense against the hostile takeover bid by Mylan. In addition, we experienced an $8.9 million reduction in share-based compensation due primarily to the resignation of Joseph C. Papa, which was offset by a $12.8 million increase in legal and professional fees and $11.2 million of integration and restructuring related expense incurred in the current period.

Tysabri ^® Royalty Stream - Change In Fair Value

We are accounting for the Tysabri ^® royalty stream as a financial asset and have elected to use the fair value option model with changes in fair value presented in Net income (loss) under the caption Tysabri ^® royalty stream - change in fair value . Changes in the fair value of the Tysabri ^® royalty stream wer e $910.8 million of expense and $69.2 million of expense for the three months ended July 2, 2016 and June 27, 2015, respectively. Changes in the fair value of the Tysabri ^® royalty stream wer e $1.1 billion of expense and $31.5 million of income for the six months ended July 2, 2016 and June 27, 2015, respectively, resulting in a change of $841.6 million and $1.1 billion for the three and six months ended July 2, 2016 compared to the prior year period, due to changes in the discount rate and cash flow assumptions, respectively.

Perrigo Company plc - Item 2

Unallocated, Interest, Other, and Taxes

granted priority review with target action date in December 2016. A priority review is a designation when the FDA will direct overall attention and resources to the evaluation of applications for drugs that, if approved, would be significant improvements in the safety or effectiveness of the treatment, diagnosis, or prevention of serious conditions when compared to standard applications. Although the product has not launched, industry analysts believe that based on released clinical study information and the recent announcement, Ocrevus ^® could favorably compete against Tysabri ^® in the relapsing, remitting multiple sclerosis market segment due to its high efficacy and convenient dosage form. Given the new market information for Ocrevus ^® , using industry analyst estimates we reduced our first ten year growth forecast from an average of approximately 3.4% in the fourth calendar quarter of 2015 to approximately growth of 1.8% and a decline of minus 0.4% in the first and second calendar quarters of 2016, respectively, which had the effect of reducing cumulative cash flows over the ten year period by approximately 3.0% and 18.0% compared to the fourth quarter of calendar 2015, respectively. These effects, combined with the change in discount rate, resulted in a reduction in fair value of $1.1 billion in the first six months of 2016. See Item 1. Note 6 for more information on the assumptions.

Interest and Other (Consolidated)

Interest Expense, Net

Interest expense, net was $57.4 million for the three months ended July 2, 2016 , compared to $45.9 million for the prior year period. The $11.5 million increase was due to interest incurred in the current year on the $1.2 billion senior notes issued on March 7, 2016.

Interest expense, net was $108.6 million for the six months ended July 2, 2016 , compared to $89.2 million for the prior year period. The $19.4 million increase was due to interest incurred on the debt assumed in the Omega acquisition, borrowings on our revolving credit agreements during the six months ended July 2, 2016 , and the issuance of $1.2 billion of senior notes on March 7, 2016. See the " Borrowings and Capital Resources " section below and Item 1. Note 10 for more information.

Other Expense, Net

Other expense, net , was $28.8 million for the three months ended July 2, 2016 , compared to $15.8 million in the prior year period. The $13.0 million increase was due to a $22.3 million impairment charge on an equity method investment recorded in the current year period, offset partially by the absence of $5.5 million of losses associated with an acquisition-related derivative and the termination of an interest rate swap recorded in the prior year. See Item 1. Notes 3 , 7 , and 8 , for more information on the goodwill impairment charge, equity method investment loss, and derivative loss, respectively.

Other expense, net , was $31.3 million for the six months ended July 2, 2016 , compared to $273.9 million in the prior year period. The $242.6 million decrease was due primarily to the absence of the $259.8 million loss we incurred in the prior year period on the derivatives we used to economically hedge fluctuations in the euro-denominated purchase price of the Omega and GSK Products acquisitions, offset partially by a gain of $12.5 million from the transfer of a rights agreement in the prior year. The losses on the derivatives due to the changes in the EUR/USD exchange rate prior to their settlement economically offset the final settlement of the euro-denominated Omega purchase price paid on March 30, 2015.

Perrigo Company plc - Item 2

Unallocated, Interest, Other, and Taxes

Income Taxes (Consolidated)

Perrigo Company plc - Item 2

Financial Condition, Liquidity and Capital Resources

FINANCIAL CONDITION, LIQUIDITY, AND CAPITAL RESOURCES

Cash and Cash Equivalents

* Working capital represents current assets less current liabilities, excluding cash and cash equivalents, and current indebtedness.

Cash, cash equivalents, and cash flows from operations are expected to be sufficient to finance our known and/or foreseeable liquidity and capital expenditures. In addition, we have the ability to borrow under our credit facilities. Although our lenders have made commitments to make funds available to us in a timely fashion under our revolving credit agreements and overdraft facilities, if economic conditions worsen or new information becomes publicly available impacting the institutions’ credit rating or capital ratios, these lenders may be unable or unwilling to lend money pursuant to our existing credit facilities.

Our Tysabri ^® royalty stream is now accounted for as a financial asset using the fair value option. As a result, cash receipts from the royalty stream are presented as cash from investing activities, rather than as cash from operating activities in the Condensed Consolidated Statement of Cash Flows for the Restated Periods presented below.

Operating Activities

We generated $229.7 million of cash from operating activities during the six months ended July 2, 2016 , a $333.7 million decrease over the comparable prior year period due primarily to the following:


•	Changes in accounts payable, which contributed to a $47.0 million outflow in the first six months of 2016 compared to a $167.4 million inflow in the first six months of 2015. The primary reasons for the outflow in 2016 were the addition of Omega operations in the current year period and changes to the Omega accounts payable structure as discussed below.

Perrigo Company plc - Item 2

Financial Condition, Liquidity and Capital Resources


•	Changes in accrued customer-related programs, which led to a $44.2 million outflow in the first six months of 2016 compared to a $19.5 million inflow for the first six months of 2015. The primary reason for the outflow in 2016 is the pricing dynamics in the Rx segment.


•	Changes in accrued liabilities, which led to a $53.9 million outflow in the first six months of 2016 compared to a $9.3 million outflow in the prior year period due primarily to payment of legal expenses associated with the Mylan defense which were accrued at December 31, 2015.


•	Changes in accrued payroll and related taxes, which contributed to a $39.2 million outflow in the first six months of 2016 compared to a $3.8 million outflow in the first six months of 2015. The primary reasons for the increased outflow in 2016 were severance payments related to the restructuring activities and the addition of Omega operations in the current year period.


•	Offset partially by changes in accounts receivable, which contributed to a $41.2 million inflow in the first six months of 2016 compared to $47.7 million outflow in 2015. The inflow in the first six months of 2016 was due to reduced accounts receivable due to lower sales volumes, offset partially by a reduction of factoring in the current period.

Operating cash flow was also impacted by decreased net earnings after adjusting for non-cash items such as impairment charges, changes in the fair value of the Tysabri ^® royalty stream, and depreciation and amortization.

Our operating cash flow for the current year period was unfavorably impacted by actions we took to establish a more normalized cash flow pattern within our BCH segment. Generally our BCH segment has seasonally stronger sales and cash flow inflows in the second and fourth quarters and stronger cash outflows in the first and third quarters. In the past, accounts payable terms with suppliers were structured to take account of this seasonality. This payment structure had a favorable impact on operating cash flow during the prior year period as only the second quarter inflow from these payment structures was included. In order to establish a more sustainable cash flow pattern during the year, we changed these payment structures during the six months ended July 2, 2016 , which had a one-time unfavorable impact on operating cash flow.

Investing Activities

Cash used for investing activities totaled $307.9 million for the six months ended July 2, 2016 , compared to $2.3 billion in the prior year period. The cash used in the current year was due primarily to the Tretinoin Products acquisition, which used $416.4 million in cash. In the comparable prior year period, cash used for investing activities consisted primarily of a $2.1 billion outflow for business acquisitions, mainly attributable to Omega, as well as a $303.5 million outflow related to the cash settlement of non-designated foreign currency derivatives we used to hedge the euro-denominated Omega and GSK Products purchase prices. Cash used for capital expenditures totaled $57.1 million during six months ended July 2, 2016 compared to $89.0 million in the prior period year. The decrease in cash used for capital expenditures over the prior year period was due primarily to several large infrastructure projects nearing completion. Investing cash outflows were offset partially by $169.9 million and $168.9 million of Tysabri ^® royalty proceeds for the six months ended July 2, 2016 and June 27, 2015, respectively.

Perrigo Company plc - Item 2

Financial Condition, Liquidity and Capital Resources

Financing Activities

Cash generated from financing activities totaled $305.5 million for the six months ended July 2, 2016 , compared to cash used for financing activities of $986.8 million for the comparable prior year period. The primary contributor to the cash generation in the current year period was the borrowing of $1.2 billion of long-term debt. This was offset in part by net repayments on our revolving credit agreements and other short-term financing totaling $803.9 million . In the prior year period, the cash used for financing activities was due primarily to payments of $889.0 million on long-term debt, which included the repayment of debt assumed from Omega and a $300.0 million legacy Perrigo term loan. For more information see "Borrowings and Capital Resources" below and Item 1. Note 10 .

The declaration and payment of dividends, if any, is subject to the discretion of our Board of Directors and will depend on our earnings, financial condition, availability of distributable reserves, capital and surplus requirements, and other factors our Board of Directors may consider relevant.

In October 2015, the Board of Directors approved a share repurchase plan of up to $2.0 billion, of which $1.5 billion is still available to be repurchased through December 31, 2018. We did not repurchase any shares under the share repurchase plan during the six months ended July 2, 2016 . The timing and amount of future repurchases, if any, will depend upon several factors, including market and business conditions, the trading price of our ordinary shares, available cash flow, and other investment opportunities.

Borrowings and Capital Resources

Perrigo Company plc - Item 2

Financial Condition, Liquidity and Capital Resources

Overdraft Facilities

Our BCH segment uses overdraft facilities to increase the efficiency of its cash utilization and meet its short-term liquidity needs. We repaid the balance outstanding under these overdraft facilities during the three months ended July 2, 2016, but retain the ability to use these facilities in our day-to-day cash operations. The balance outstanding under the facilities was $82.9 million at December 31, 2015 .

Accounts Receivable Factoring

Revolving Credit Agreements

On December 9, 2015, our 100% owned finance subsidiary, Perrigo Finance Unlimited Company (formerly Perrigo Finance plc) ("Perrigo Finance"), entered into a $750.0 million revolving credit agreement (the "2015 Revolver"). At December 31, 2015, $380.0 million was outstanding under the 2015 Revolver. On March 15, 2016, we used the proceeds of the debt issuance described below under "Long-Term Debt" to repay the $750.0 million then outstanding under the 2015 Revolver and terminated the facility.

On December 5, 2014 , Perrigo Finance entered into a $600.0 million revolving credit agreement, which we increased to $1.0 billion on March 30, 2015 (the "2014 Revolver"). At December 31, 2015, $300.0 million was outstanding under the 2014 Revolver. On March 15, 2016, we used the proceeds of the debt issuance described below under "Long-Term Debt" to repay the $435.0 million then outstanding under the 2014 Revolver. There were no borrowings outstanding under the 2014 Revolver as of July 2, 2016 .

Long-Term Debt

We had $5.9 billion and $4.7 billion outstanding under our notes and bonds, and $473.3 million and $488.8 million outstanding under our term loan, as of July 2, 2016 and December 31, 2015 , respectively. We expect to prepay our 1.300% $500.0 million senior notes due November 2016 in September 2016.

As described in our Current Report on Form 8-K filed on April 25, 2017, the lenders under our 2014 Revolver and 2014 Term Loan waived any default or event of default that may arise from any restatement of or deficiencies in our financial statements for the periods specified in such waivers, including the quarter ended July 2, 2016. No default or event of default existed prior to receipt of these waivers. We are in compliance with all covenants under the 2014 Revolver and the 2014 Term Loan as of the date of this Form 10-Q/A. See Item 1. Note 10 for more information on all of the above debt facilities.

Credit Ratings

Our credit ratings on July 2, 2016 were Baa3 (stable) and BBB- (stable) by Moody's Investors Service and Standard and Poor's Global Ratings, respectively. On August 10, 2016, Moody’s affirmed our Baa3 credit rating and changed our outlook to negative from stable.

Credit rating agencies review their ratings periodically and, therefore, the credit rating assigned to us by each agency may be subject to revision at any time. Accordingly, we are not able to predict whether current credit ratings will remain as disclosed above. Factors that can affect our credit ratings include changes in operating

Perrigo Company plc - Item 2

Financial Condition, Liquidity and Capital Resources

performance, the economic environment, our financial position, and changes in business strategy. If changes in our credit ratings were to occur, they could impact, among other things, future borrowing costs, access to capital markets, and vendor financing terms.

Contractual Obligations and Commitments

Other than the obligations related to the changes to our debt structure in relation to the 2016 Notes, as discussed in Note 10 of the Notes to the Condensed Consolidated Financial Statements, there were no material changes in contractual obligations as of July 2, 2016 from those provided in our Transition Report on Form 10-KT for the transition period from June 28, 2015 to December 31, 2015. See below for a revised schedule of our enforceable and legally binding obligations as of July 2, 2016 related to our short and long-term debt arrangements.



	Payment Due by Period (in millions)
	2016 ⁽¹⁾		2017 - 2018		2019 - 2020		After 2020		Total
Short and long-term debt ⁽²⁾	$	660.5	$	1,682.1	$	811.6	$	5,508.4	$	8,662.6

⁽¹⁾ Reflects remaining six months of 2016.


⁽²⁾	Short and long-term debt includes interest payments, which were calculated using the effective interest rate at July 2, 2016 .

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

There have been no material changes to our quantitative or qualitative disclosures found in Item 7A, "Quantitative and Qualitative Disclosures about Market Risk," of our Transition Report on Form 10-KT for the transition period from June 28, 2015 to December 31, 2015 .

ITEM 4. CONTROLS AND PROCEDURES

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) or 15d-15(e) of the Exchange Act) as of July 2, 2016. Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were not effective as of July 2, 2016 because of the material weaknesses in our internal control over financial reporting described below.

All systems of internal control, no matter how well designed, have inherent limitations. Therefore, even those systems deemed to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. A material weakness is a deficiency, or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of a company’s annual or interim consolidated financial statements will not be prevented or detected on a timely basis.

Evaluation of the Effectiveness of Internal Control over Financial Reporting

Tysabri ^® Contingent Payments

We acquired the Tysabri ^® royalty stream through our acquisition of Elan in December 2013. At the time of the acquisition, we concluded that the right to receive quarterly royalty payments from Biogen should be an intangible asset and such payments recognized as revenue in our financial statements. As discussed in Item 4.02 of our Form 8-K filed on April 25, 2017, during the 2016 year-end close process, and in anticipation of our potential sale of the Tysabri ^® royalty rights and the 2018 adoption of ASC 606 Revenue from Contracts with Customers , we re-evaluated the historical classification of the Tysabri ^® royalty stream as an intangible asset and concluded that it should have been reflected in the financial statements as a financial asset as of its 2013 acquisition date. As part of this evaluation, management determined that its control over the review of the application of the accounting guidance in ASC 805 Business Combinations did not operate effectively in the appropriate identification of the assets acquired and liabilities assumed in connection with the Elan acquisition in December 2013. All of our originally filed financial statements through the filing of the Form 10-Q for the quarter ended October 1, 2016, as originally filed on November 10, 2016, included the disclosure of the Elan acquisition with the Tysabri ^® royalty stream presented as an intangible asset. In addition, due to the fact that the asset was historically classified as an

Perrigo Company plc - Item 4

Controls and Procedures

intangible asset, we did not design or implement controls around the fair value accounting for the Tysabri ^® royalty stream as a financial asset, so these controls were not in place at any quarter end subsequent to the acquisition including the date of the annual assessment of controls.

These control deficiencies created a reasonable possibility that a material misstatement to the annual consolidated financial statements would not be prevented or detected on a timely basis. Accordingly, management concluded that these control deficiencies represent material weaknesses.

Income Taxes

Management has determined that we did not design or maintain effective management review controls related to our income tax procedures in our interim income tax reporting, determination of our deferred taxes in connection with business combinations or the determination of valuation allowances for our deferred tax assets

As disclosed in our Form 10-Q for the quarterly period ended April 2, 2016 (the “First Quarter 2016 10-Q”), management determined that we did not design or maintain effective management review controls that operated at a sufficient level of precision to ensure interim income taxes were properly recorded and disclosed in our condensed consolidated financial statements in connection with the recording of an indefinite-lived intangible asset impairment and estimated goodwill impairment. These control deficiencies resulted in a material misstatement in income taxes in the preliminary financial statements for the quarter ended April 2, 2016. The material misstatement in interim income taxes was corrected prior to the filing of the First Quarter 2016 10-Q.

In February 2017, management identified the existence of tax basis in certain acquired intangible assets (“tax amortization benefits”) that existed at the time of the acquisition of Omega on March 30, 2015. Upon evaluating the tax amortization benefits, management concluded that the purchase accounting for Omega should have included the tax basis in the intangible assets in calculating the deferred tax liability in the opening balance sheet. This omission of existing tax basis in calculating the deferred tax liability on the acquisition date indicated that management’s review over the opening balance sheet deferred income tax positions was not operating appropriately.

These control deficiencies created a reasonable possibility that a material misstatement to the interim and annual consolidated financial statements would not be prevented or detected on a timely basis. Accordingly, management concluded that these control deficiencies represent material weaknesses.

Plan for Remediation of Material Weaknesses

We are committed to remediating the control deficiencies that gave rise to the material weaknesses described above. Management is responsible for implementing changes and improvements to internal control over financial reporting and for remediating the control deficiencies that gave rise to the material weaknesses.

To remediate the material weakness in internal control over financial reporting related to the acquisition of the Tysabri ^® royalty rights, we plan, with oversight from the Audit Committee, to:


•	Review the processes and controls in place related to our application of ASC 805 to enhance the effectiveness of the design and operation of those controls to identify assets acquired and liabilities assumed; and


•	Evaluate and enhance management review controls related to business acquisitions.

In addition, as part of our restatement process described in Note 1 to the Condensed Consolidated Financial Statements, we designed and initiated certain controls around the accounting for the Tysabri ^® royalty stream as a financial asset. These controls that we are implementing include: 1) procedures related to the fair value estimation process, such as the use of relevant data and key assumptions utilized in the projections of future cash flows and calculation of discount rates and 2) management review controls over key assumptions and methodologies used in the calculations. We expect to fully implement the remediation actions during the second quarter of 2017 to remediate the control deficiencies around the financial asset.

Until the remediation actions are fully implemented and the design and operating effectiveness of related internal controls is validated through testing, the material weaknesses described above will continue to exist.

Perrigo Company plc - Item 4

Controls and Procedures

To remediate the material weakness in internal control over financial reporting related to income taxes, we plan, with oversight from the Audit Committee, to:


•	Review the processes and controls in place to measure and record income taxes to enhance the efficiency and effectiveness of the design and operation of those controls;


•	Enhance monitoring activities related to income taxes;


•	Evaluate and enhance the level of precision in the management review controls related to income taxes;


•	Test and evaluate the design and operating effectiveness of the control procedures; and


•	Assess the effectiveness of the remediation plan.

We are committed to achieving and maintaining a strong internal control environment and believe the remediation measures will strengthen our internal control over financial reporting and remediate the material weaknesses identified. We intend to review each of the identified material weaknesses and add resources and improve our processes to achieve and maintain a strong control environment. We will continue to monitor the effectiveness of these remediation measures and will make any changes and take such other actions that we deem appropriate given the circumstances.

Changes in Internal Control over Financial Reporting

As disclosed above under “Income Taxes,” "Tysabri ^® Contingent Payments," and in the Original Filing, we identified the material weakness related to interim income taxes during the quarterly period ended April 2, 2016. During the quarterly period ended July 2, 2016, we began taking the actions described above under “Plan for Remediation of Material Weaknesses” to remediate that material weakness. There were no other changes in our internal control over financial reporting during the three months ended July 2, 2016 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II. OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

Refer to Part I, Item 1. Note 14 to the Condensed Consolidated Financial Statements.

ITEM 1A. RISK FACTORS

Our Annual Report on Form 10-K for the year ended December 31, 2016 (the “2016 Form 10-K”) includes a detailed discussion of our risk factors. Please refer to Item 1A of our 2016 Form 10-K, which we anticipate filing on or about the date hereof, and review such risk factors in connection with your review of this Form 10-Q/A.

I TEM 5. OTHER INFORMATION

On August 9, 2016, we issued a notice of redemption to redeem all of the $500.0 million in aggregate principal amount of then outstanding 1.300% senior notes due 2016 (the “1.300% 2016 Notes”). We redeemed all of the 1.300% 2016 Notes on September 29, 2016.

ITEM 6. EXHIBITS



Exhibit Number		Description

3.1		Certificate of Incorporation of Perrigo Company plc (formerly known as Perrigo Company Limited) (incorporated by reference from Exhibit 4.1 to the Company's Registration Statement on Form S-8 filed on December 19, 2013).

3.2		Memorandum and Articles of Association of Perrigo Company plc, as amended (incorporated by reference from Exhibit 3.2 to the Company's Transition Report on Form 10-KT filed on February 25, 2016).

Perrigo Company plc - Part II - Item 6

Exhibits



10.1		Amendment No. 3, effective as of April 24, 2016, to the Employment Agreement, effective as of October 9, 2006, by and between Perrigo Company and Joseph C. Papa (incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on April 25, 2016).

10.2		Mutual Agreement dated April 27, 2016 among the Company, Omega Pharma NV, Perrigo Ireland 2 Ltd, Mylecke Management, Art & Invest NV, Alychlo NV and Marc Coucke (incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on April 28, 2016).

10.3		Amendment dated April 27, 2016 to the Agreement for the Sale and Purchase of 685,348,257 Shares Of Omega Pharma Invest NV, dated as of November 6, 2014, by and among the Company, Alychlo NV and Holdco I BE NV (incorporated by reference from Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on April 28, 2016).

10.4		Amendment dated April 27, 2016 to the Non-Compete Agreement between the Company and Marc Coucke dated March 30, 2015 (incorporated by reference from Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on April 28, 2016).

10.5		Amendment dated April 27, 2016 to the Lock-up Agreement between the Company and Alychlo NV dated March 30, 2015 (incorporated by reference from Exhibit 10.4 to the Company’s Current Report on Form 8-K filed on April 28, 2016).

10.6		Amendment No. 4, effective as of May 6, 2016, to the Employment Agreement, effective as of October 9, 2006, by and between Perrigo Company and Joseph C. Papa (incorporated by reference from Exhibit 10.5 to the Company’s Quarterly Report on Form 10-Q filed on May 16, 2016).

10.7		Waiver to Note Purchase Agreement, between Omega Pharma NV and the Prudential Insurance Company of America, dated May 16, 2016, in connection with the Note Purchase Agreement, dated May 19, 2011 (as amended by the First Amendment and Consent to the Note Purchase Agreement, dated as of October 7, 2011), with respect to the issuance and sale of EUR 135,043,889 aggregate principal amount of Omega’s 5.1045% senior notes due 2023 (incorporated by reference from Exhibit 10.7 to the Company’s Quarterly Report on Form 10-Q filed on May 16, 2016).

10.8		Amendment dated May 23, 2016 to the Waiver to Note Purchase Agreement, between Omega Pharma NV and the Prudential Insurance Company of America, dated May 16, 2016, in connection with the Note Purchase Agreement, dated May 19, 2011 (as amended by the First Amendment and Consent to the Note Purchase Agreement, dated as of October 7, 2011), with respect to the issuance and sale of EUR 135,043,889 aggregate principal amount of Omega’s 5.1045% senior notes due 2023 (filed with Original Filing).

10.9		Perrigo Company plc U.S. Severance Policy, as amended and restated effective June 14, 2016 (incorporated by reference from Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on June 17, 2016).

10.10		Perrigo Company plc Change in Control Severance Policy for U.S. Employees, as amended and restated effective June 14, 2016 (incorporated by reference from Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on June 17, 2016).

10.11		Amendment No. 2 to the Perrigo Company Annual Incentive Plan, effective June 14, 2016 (incorporated by reference from Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on June 17, 2016).

10.12		Second Waiver to Note Purchase Agreement, between Omega Pharma NV and the Prudential Insurance Company of America, dated June 7, 2016, in connection with the Note Purchase Agreement, dated May 19, 2011 (as amended by the First Amendment and Consent to the Note Purchase Agreement, dated as of October 7, 2011 and the Waiver to Note Purchase Agreement, dated as of May 16, 2016, as amended by a letter agreement dated May 23, 2016), with respect to the issuance and sale of EUR 135,043,889 aggregate principal amount of Omega’s 5.1045% senior notes due 2023 (filed with Original Filing).

31.1		Rule 13a-14(a) Certification by John T. Hendrickson, Chief Executive Officer (filed herewith).

31.2		Rule 13a-14(a) Certification by Ronald L. Winowiecki, Acting Chief Financial Officer (filed herewith).

32		Certification Pursuant to 18 United States Code 1350 and Rule 13a-14(b) of the Securities Exchange Act of 1934 (furnished herewith).

Perrigo Company plc - Part II - Item 6

Exhibits



101.INS		XBRL Instance Document.

101.SCH		XBRL Taxonomy Extension Schema Document.

101.CAL		XBRL Taxonomy Extension Calculation Linkbase Document.

101.DEF		XBRL Taxonomy Extension Definition Linkbase Document.

101.LAB		XBRL Taxonomy Extension Label Linkbase Document.

101.PRE		XBRL Taxonomy Extension Presentation Linkbase Document.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.



		PERRIGO COMPANY PLC
		(Registrant)

Date:	May 22, 2017	By: /s/ John T. Hendrickson
		John T. Hendrickson
		Chief Executive Officer
		(Principal Executive Officer)

Date:	May 22, 2017	By: /s/ Ronald L. Winowiecki
		Ronald L. Winowiecki
		Acting Chief Financial Officer
		(Principal Accounting and Financial Officer)