Separately, Company received in cash the entire €355 million from the recent Belgian arbitration decision
DUBLIN, Sept. 29, 2021 /PRNewswire/ -- Perrigo Company plc (NYSE; TASE: PRGO) ("Perrigo" or the "Company"), a leading provider of Quality, Affordable Self-Care Products, today announced that it has reached a settlement with the Irish Office of the Revenue Commissioners for the Notice of Amended Assessment ("NoA") dated November 29, 2018. The NoA had claimed income tax payable in the amount of approximately €1.6 billion, not including interest or penalties. On July 9, 2021, Irish Revenue acknowledged that not all relevant facts were known to them when they issued the NoA in 2018 and that, accordingly, Irish Revenue would not object to certain adjustments that would result in an aggregate reduction of more than €660 million from the income taxes claimed in the NoA as issued. At that point, Perrigo believed that the maximum amount of income tax claims in dispute was effectively reduced to less than €1.0 billion, not including any interest or penalties.
While the Company believes that its tax position was correct and would ultimately have been confirmed by the Tax Appeals Commission, given the risks inherent in any litigation, as well as the ongoing costs of what could have been years of litigation and the uncertainty that would create, the Company and Irish Revenue have agreed to settle this matter on the following terms:
- Perrigo agrees to pay €297 million as a full and final settlement of all liabilities arising from the sale of the Tysabri® patents and to be taxed in periods FY13 to FY21 inclusive;
- Irish Revenue will give Perrigo credit for certain taxes already paid and for certain unused R&D credits, all of which will be applied against the €297 million figure, such that the total cash payment that Perrigo will be making to Irish Revenue as part of this settlement will be €266.1 million;
- The settlement provides that no interest is due and no penalties apply;
- For settlement purposes only and on a "without prejudice" basis, the parties agree to apply an alternative basis of taxation than the respective positions taken by Irish Revenue in the NoA and by Elan Pharma in its tax returns;
- Irish Revenue will take no further action in relation to the NoA or any Tysabri®-related income or transactions.
Irish Revenue has confirmed in writing their acceptance of the above terms, and Perrigo expects to execute a formal settlement agreement with Irish Revenue in the coming days. Perrigo will make a payment of €266.1 million to Revenue within seven days after the parties execute the settlement agreement. The Company expects to fund this settlement through cash on hand.
Perrigo President and CEO Murray S. Kessler commented, "We believe settling this tax dispute with Irish Revenue is in the best interest of all of Perrigo's stakeholders as it removes a major uncertainty that has been a significant distraction to the Company over the last three years. While we continue to believe that our tax positions were correct and would ultimately have been confirmed through the tax appeal process, we recognize that this process was uncertain and could take many more years to complete. With what was once a multi-billion dollar uncertainty behind us, Perrigo can focus all of our efforts on delivering on our Consumer Self-Care vision and long-term value."
Separately, Perrigo announced that it has received €355 million in cash on behalf of Alychlo NV and Holdco I BE NV ("Sellers") in payment of the previously announced arbitration award issued in favor of Perrigo Ireland 2 ("Perrigo Ireland"). The award was issued August 27, 2021, by a tribunal sitting under the rules of the Belgian Centre for Arbitration and Mediation and related to claims arising under the Stock Purchase Agreement between Sellers and Perrigo Ireland dated November 6, 2014. Under Belgian law, Sellers have the right to challenge the tribunal's award for up to three months following the date of the award. However, Perrigo does not believe that Sellers have any legal grounds for any such challenge.
Perrigo Company plc (NYSE; TASE: PRGO) is a leading provider of Quality, Affordable Self-Care Products and over-the-counter (OTC) health and wellness solutions that enhance individual well-being by empowering consumers to proactively prevent or treat conditions that can be self-managed. Led by its consumer self-care strategy, Perrigo is the largest store brand OTC player in the U.S. in the categories in which it competes through more than 9,000 SKUs under customer 'own brand' labels. Additionally, Perrigo is a Top 10 OTC company by revenue in Europe, where it markets more than 200 branded OTC products throughout 28 countries. Visit Perrigo online at www.perrigo.com.
Perrigo Forward-Looking Statements
Certain statements in this press release are "forward-looking statements." These statements relate to future events or the Company's future financial performance and involve known and unknown risks, uncertainties and other factors that may cause the actual results, levels of activity, performance or achievements of the Company or its industry to be materially different from those expressed or implied by any forward-looking statements. In some cases, forward-looking statements can be identified by terminology such as "may," "will," "could," "would," "should," "expect," "forecast," "plan," "anticipate," "intend," "believe," "estimate," "poised," "predict," "potential" or the negative of those terms or other comparable terminology. The Company has based these forward-looking statements on its current expectations, assumptions, estimates and projections. While the Company believes 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 the Company's control, including: the timing of the formal settlement documentation relating to the tax settlement with Irish Revenue; the sources of funding for the settlement amount; the benefits of settling the disputed assessment, and any such risks or uncertainties that may arise in connection with any challenge to the arbitration award. These and other important factors, including those discussed under "Risk Factors" in the Company's Form 10-K for the year ended December 31, 2020, as well as the Company's subsequent filings with the United States Securities and Exchange Commission ("SEC"), 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 press release are made only as of the date hereof, and unless otherwise required by applicable securities laws, the Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
SOURCE Perrigo Company plc
For further information: Perrigo Contact: Bradley Joseph, Vice President, Global Investor Relations & Corporate Communications, (269) 686-3373, E-mail: firstname.lastname@example.org; Nicholas Gallagher, Manager, Global Investor Relations & Corporate Communications, (269) 686-3238, E-mail: email@example.com