v3.26.1
Financial Instruments and Fair Value Measurements
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
Financial Instruments and Fair Value Measurements
14.
Financial Instruments and Fair Value Measurements
Fair value is defined as the exit price that would be received from the sale of an asset or paid to transfer a liability, using assumptions that market participants would use in pricing an asset or liability. The fair value guidance establishes a three-level fair value hierarchy as follows:
•Level 1 — observable inputs such as quoted prices in active markets for identical assets or liabilities;
•Level 2 — significant other observable inputs that are observable either directly or indirectly; and
•Level 3 — significant unobservable inputs in which there is little or no market data, which requires the Company to develop its own assumptions.
The following tables provide a summary of the significant assets and liabilities that are measured at fair value on a recurring basis at the end of each period:
Fair Value Measurement
Using Fair Value Hierarchy:
June 30,
2026		Level 1Level 2Level 3
Assets:
Equity securities$0.3 $0.3 $— $— 
$0.3 $0.3 $— $— 
Liabilities:
Deferred compensation liabilities$18.7 $— $18.7 $— 
Contingent consideration liabilities54.7 — — 54.7 
$73.4 $— $18.7 $54.7 
Fair Value Measurement
Using Fair Value Hierarchy:
December 31,
2025		Level 1Level 2Level 3
Assets:
Equity securities$10.5 $10.5 $— $— 
$10.5 $10.5 $— $— 
Liabilities:
Deferred compensation liabilities$21.7 $— $21.7 $— 
Contingent consideration liabilities54.8 — — 54.8 
$76.5 $— $21.7 $54.8 
Equity securities. Equity securities consisted primarily of shares of Silence Therapeutics plc (“Silence”), for which quoted prices are available in an active market; therefore, these investments are classified as Level 1 and are valued based on quoted market prices reported on internationally recognized securities exchanges.
During the three and six months ended June 30, 2026, the Company divested all of its ownership interest in Silence for proceeds of $4.5 million and $10.2 million, respectively, resulting in realized gains of $0.5 million and $0.6 million for the three and six months ended June 30, 2026, respectively, included within other income (expense), net in the Unaudited Condensed Consolidated Statements of Operations.
Deferred compensation liabilities. The Company maintains a non-qualified deferred compensation plan in the U.S. (the “Supplemental Savings Plan”) for eligible employees. A recordkeeping account is maintained for each participant, inclusive of any employee deferrals and any company credits earned by the participant. The plan is currently frozen for employee deferrals. Participants may choose from a variety of investments for the deemed investment of their accounts, which generally correspond to the funds offered in the Company’s U.S. tax-qualified defined contribution retirement plan. Recordkeeping account balances fluctuate with the investment returns on the selected investments.
Contingent consideration liability. The fair value of contingent consideration liabilities is determined using unobservable inputs; hence, these instruments represent Level 3 measurements within the above-defined fair value hierarchy. These inputs include the estimated amount and timing of projected cash flows, the probability of success (achievement of the contingent event) and the risk-adjusted discount rate used to present value the probability-weighted cash flows. Subsequent to the acquisition date, at each reporting period, the contingent consideration liability is remeasured at current fair value with changes recorded in earnings. The estimates of fair value are uncertain and changes in any of the estimated inputs used as of the date of this report could have resulted in significant adjustments to fair value.
The following table summarizes activity for contingent consideration:
Terlivaz CVR (1)
Edex (2)
Total
December 31, 2025$20.0 $34.8 $54.8 
Fair value adjustment— 1.2 1.2 
Payments— (1.3)(1.3)
June 30, 2026$20.0 $34.7 $54.7 
(1) Fair value classified within accrued and other current liabilities as of June 30, 2026 and December 31, 2025.
(2) Includes fair value of $2.9 million and $3.0 million as of June 30, 2026 and December 31, 2025, classified within accrued and other current liabilities, respectively.
Financial Instruments Not Measured at Fair Value
The following methods and assumptions were used by the Company in estimating fair values for financial instruments not measured at fair value as of June 30, 2026 and December 31, 2025:
•The carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and the majority of other current assets and liabilities approximate fair value because of their short-term nature. The Company classifies cash on hand and deposits in banks, including commercial paper, money market accounts and other highly liquid investments it may hold from time to time, with an original maturity of three months or less, as cash and cash equivalents (Level 1). The fair value of restricted cash was equivalent to its carrying value of $142.3 million and $141.1 million as of June 30, 2026 and December 31, 2025 (Level 1), respectively. Restricted cash as of June 30, 2026 primarily relates to certain self-insurance related matters of $85.9 million, $22.6 million related to the Mallinckrodt Baker escrow and approximately $33.8 million related to certain bank guarantees, letters of credit, surety bonds, and other collateral arrangements.
•The Company's 8.50% Senior Secured Notes due April 2031 are classified as Level 1, as quoted prices are available in an active market for these notes. Since quoted market prices for the Company's Term Loan due April 2031 are not available in an active market, they are classified as Level 2 for purposes of developing an estimate of fair value. Refer to Note 15. Debt of the Notes to the Consolidated Financial Statements included in Item 8. Financial Statements and Supplementary Data of the 2025 Form 10-K for further discussion regarding the Company’s debt instruments.
June 30, 2026December 31, 2025
Carrying
Value		Fair
Value		Carrying
Value		Fair
Value
Level 1:
8.50% Senior Secured Notes due April 2031
$1,054.3 $1,054.0 $1,060.0 $1,058.1 
Level 2:
Term Loan due April 20311,479.3 1,477.4 1,487.3 1,472.0 
Total Debt$2,533.6 $2,531.4 $2,547.3 $2,530.1 
Concentration of Credit and Other Risks
Financial instruments that potentially subject the Company to concentrations of credit risk primarily consist of accounts receivable. The Company generally does not require collateral from customers.
The following table shows net sales attributable to customers that accounted for 10.0% or more of the Company's total net sales:
Three Months EndedSix Months Ended
June 30,
2026		June 27,
2025		June 30,
2026		June 27,
2025
FFF Enterprises, Inc.39.8 %62.8 %37.3 %59.3 %
Cencora, Inc.19.0 *19.4 *
CVS Health Corporation12.9 *12.6 *
* Net sales to this customer were less than 10.0% of total net sales during the respective periods presented above.
The following table shows accounts receivable attributable to distributors that accounted for 10.0% or more of the Company's gross accounts receivable at the end of each period:
June 30,
2026		December 31,
2025
Cencora, Inc.38.7 %47.5 %
FFF Enterprises, Inc.29.1 19.2