12/7/2017
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`Form 10-K
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`lO-K l lek.htm FORM lO-K
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`Table of Contents
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`
`
`SECURITIES AND EXCHANGE COMMISSION
`
`UNITED STATES
`
`Washington, D.C. 20549
`
`FORM 10—K
`
`(Mark One)
`IZI
`
`Cl
`
`ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
`EXCHANGE ACT OF 1934
`
`For the Fiscal Year Ended December 31, 2010
`
`or
`
`TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
`EXCHANGE ACT OF 1934
`
`Commission File Number 1—10269
`
`Allergan, Inc.
`(Exact Name of Registrant as Specified in its Charter)
`
`Delaware
`(State or Other Jurisdiction of
`Incorporation or Organization)
`
`2525 Dupont Drive
`Irvine, California
`(Address of Principal Executive Offices)
`
`95—1622442
`(IRS. Employer Identification No.)
`
`92612
`(Zip Code)
`
`(714) 246-4500
`(Registrant’s Telephone Number, Including Area Code)
`Securities Registered Pursuant to Section 12(b) ofthe Act:
`Name of Each Exchange on Which Registered
`New York Stock Exchange
`
`Title of Each Class
`Common Stock, $0.01 Par Value
`Securities Registered Pursuant to Section 12(g) of the Act: None
`Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes IZI No El
`Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes El No IZI
`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 reports), and (2) has been subject
`to such filing requirements for
`the past
`90 days. Yes
`IZI No El
`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 suchfiles). Yes IZl No El
`Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained,
`to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-
`IZI
`K.
`Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of
`“large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
`
`Accelerated filer El
`Large accelerated filer I21
`Smaller reporting company El
`Non-accelerated filer El (Do not check if a smaller reporting company)
`Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes El No 121
`As of June 30, 2010, the aggregate market value of the registrant’s common stock held by non-affiliates of the registrant was approximately $17,638 million based on the
`closing sale price as reported on the New York Stock Exchange.
`Common stock outstanding as ofFebruary 22, 2011 7 307,511,888 shares (including 1,834,765 shares held in treasury).
`DOCUMENTS INCORPORATED BY REFERENCE
`
`Part III of this report incorporates certain information by reference from the registrant’s proxy statement for the annual meeting of stockholders to be held on May 3, 2011,
`which proxy statement will be filed no later than 120 days alter the close of the registrant’s fiscal year ended December 31, 2010.
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`ALCON 21 16
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`Argentum Pharrn. LLC V. Alcon Research, Ltd.
`Case IPR2017-01053
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`12/7/2017
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`Table of Contents
`
`Form 10-K
`
`TABLE OF CONTENTS
`
`
`
`PART I.
`Item 1.
`Item 1A.
`Item 1B.
`Item 2.
`Item 3.
`Item 4.
`PART II.
`Item 5.
`
`Item 6.
`Item 7.
`Item 7A.
`Item 8.
`Item 9.
`Item 9A.
`Item 9B.
`PART III.
`Item 10.
`Item 11.
`Item 12.
`Item 13.
`Item 14.
`PART IV.
`Item 15.
`SIGNATURES
`
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`
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`
`
` Business
` Risk Factors
` Unresolved Staff Comments
` Properties
` Legal Proceedings
`(Removed and Reserved)
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`Market For Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity
`Securities
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` Selected Financial Data
` Management’s Discussion and Analysis of Financial Condition and Results of Operations
` Quantitative and Qualitative Disclosures About Market Risk
` Financial Statements and Supplementary Data
` Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
` Controls and Procedures
` Other Information
`
` Directors, Executive Officers and Corporate Governance
` Executive Compensation
` Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
` Certain Relationships and Related Transactions, and Director Independence
` Principal Accounting Fees and Services
`
` Exhibits and Financial Statement Schedules
`
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`Form 10-K
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`Statements made by us in this report and in other reports and statements released by us that are not historical facts constitute “forward-
`looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21 of the Securities
`Exchange Act of 1934, as amended. These forward-looking statements are necessarily estimates reflecting the best judgment of our senior
`management based on our current estimates, expectations, forecasts and projections and include comments that express our current
`opinions about trends and factors that may impact future operating results. Disclosures that use words such as we “believe,” “anticipate,”
`“estimate,” “intend,” “could,” “plan,” “expect,” “project” or the negative of these, as well as similar expressions, are intended to
`identify forward-looking statements. These statements are not guarantees of future performance and rely on a number of assumptions
`concerning future events, many of which are outside of our control, and involve known and unknown risks and uncertainties that could
`cause our actual results, performance or achievements, or industry results, to differ materially from any future results, performance or
`achievements expressed or implied by such forward-looking statements. We discuss such risks, uncertainties and other factors throughout
`this report and specifically under the caption “Risk Factors” in Item 1A of Part I of this report below. Any such forward-looking
`statements, whether made in this report or elsewhere, should be considered in the context of the various disclosures made by us about our
`businesses including, without limitation, the risk factors discussed below. Except as required under the federal securities laws and the
`rules and regulations of the U.S. Securities and Exchange Commission, we do not have any intention or obligation to update publicly any
`forward-looking statements, whether as a result of new information, future events, changes in assumptions or otherwise.
`
`
`Item 1.
`
`Business
`
`General Overview of our Business
`
`PART I
`
`We are a multi-specialty health care company focused on developing and commercializing innovative pharmaceuticals, biologics,
`medical devices and over-the-counter products that enable people to live life to its greatest potential — to see more clearly, move more
`freely and express themselves more fully. Our diversified approach enables us to follow our research and development into new specialty
`areas where unmet needs are significant.
`
`We discover, develop and commercialize specialty pharmaceutical, biologics, medical device and over-the-counter products for the
`ophthalmic, neurological, medical aesthetics, medical dermatology, breast aesthetics, obesity intervention, urological and other specialty
`markets in more than 100 countries around the world. Our diversified business model includes products for which patients may be eligible
`for reimbursement and cash pay products that consumers pay for directly. Based on internal information and assumptions, we estimate that
`in fiscal year 2010, approximately 71% of our net product sales were derived from reimbursable products and 29% of our net product sales
`were derived from cash pay products.
`
`We are a pioneer in specialty pharmaceutical, biologic and medical device research and development, with global efforts targeting
`products and technologies related to eye care, skin care, neuromodulators, medical aesthetics, obesity intervention, urology and neurology.
`In 2010, our research and development expenditures were approximately 16.7% of our product net sales or approximately $804.6 million.
`We supplement our own research and development activities with our commitment to identify and obtain new technologies through in-
`licensing, research collaborations, joint ventures and acquisitions.
`
`We were founded in 1950 and incorporated in Delaware in 1977. Our principal executive offices are located at 2525 Dupont Drive,
`Irvine, California, 92612, and our telephone number at that location is (714) 246-4500. Our Internet website address is www.allergan.com.
`Our Internet website address is not intended to function as a hyperlink and the information available at our website address is not
`incorporated by reference into this Annual Report on Form 10-K. We make our periodic and current reports, together with amendments to
`these reports, available on our Internet website, free of charge, as soon as reasonably practicable after such material is
`
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`electronically filed with, or furnished to, the U.S. Securities and Exchange Commission, or SEC. The SEC maintains an Internet website at
`www.sec.gov that contains the reports, proxy and information statements and other information that we file electronically with the SEC.
`
`Operating Segments
`
`We operate our business on the basis of two reportable segments — specialty pharmaceuticals and medical devices. The specialty
`pharmaceuticals segment produces a broad range of pharmaceutical products, including: ophthalmic products for dry eye, glaucoma,
`retinal diseases and ocular surface disease; Botox for certain therapeutic and aesthetic indications; skin care products for acne, psoriasis,
`®
`eyelash growth and other prescription and over-the-counter skin care products; and urologics products. The medical devices segment
`produces a broad range of medical devices, including: breast implants for augmentation, revision and reconstructive surgery; obesity
`intervention products, including the Lap-Band System and the Orbera Intragastric Balloon System; and facial aesthetics products. The
`®
`™
`following table sets forth, for the periods indicated, product net sales for each of our product lines within our specialty pharmaceuticals
`segment and medical devices segment, domestic and international sales as a percentage of total product net sales within our specialty
`pharmaceuticals segment and medical devices segment, and segment operating income for our specialty pharmaceuticals segment and
`medical devices segment:
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`2010
`
`
`
`Year Ended December 31,
`2009
`
`
`
`(dollars in millions)
`
`2008
`
`
`
`
`
`$2,262.0
` 1,419.4
`
`229.5
`
`62.5
`$3,973.4
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`$2,100.6
` 1,309.6
`
`208.0
`
`65.6
`$3,683.8
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`$2,009.1
` 1,310.9
`
`113.7
`
`68.6
`$3,502.3
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`63.6%
`36.4%
`
`
`
`
`
`
`
`
`
`
`
`
`
`66.5%
`33.5%
`
`
`
`
`
`
`
`
`
`
`65.2%
`34.8%
`
`$ 319.1
`
`243.3
`
`283.8
`$ 846.2
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`$ 287.5
`
`258.2
`
`218.1
`$ 763.8
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`$ 310.0
`
`296.0
`
`231.4
`$ 837.4
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`57.9%
`
`42.1%
`
`$1,501.9
`
`284.7
`
`
`
`
`
`
`
`
`
`
`
`60.5%
`
`39.5%
`
`$1,370.8
`
`189.2
`
`
`
`
`
`
`
`
`62.0%
`
`38.0%
`
`$1,220.1
`
`222.0
`
`$3,222.4
`
`688.1
`
`$3,678.3
`
`572.3
`
`$3,785.4
`
`549.4
`
`
`
`
`Specialty Pharmaceuticals Segment Product Net Sales by Product Line
`Eye Care Pharmaceuticals
`Botox /Neuromodulator
`®
`Skin Care
`Urologics
`Total Specialty Pharmaceuticals Segment Product Net Sales
`Specialty Pharmaceuticals Segment Product Net Sales
`Domestic
`International
`Medical Devices Segment Product Net Sales by Product Line
`Breast Aesthetics
`Obesity Intervention
`Facial Aesthetics
`Total Medical Devices Segment Product Net Sales
`Medical Devices Segment Product Net Sales
`Domestic
`International
`Specialty Pharmaceuticals Segment Operating Income (1)
`Medical Devices Segment Operating Income (1)
`Consolidated Long-Lived Assets
`Domestic
`International
`
`
`
`
`
`2
`
`
`
`
`
`
`
`
`
`
`
`(1) Management evaluates business segment performance on an operating income basis exclusive of general and administrative
`expenses and other indirect costs, legal settlement expenses, intangible asset impairment and related costs, restructuring
`charges, in-process research and development expenses, amortization of certain identifiable intangible assets related to business
`combinations and asset acquisitions and related capitalized licensing costs and certain other adjustments, which are not
`allocated to our business segments for performance assessment by our chief operating decision maker. Other adjustments
`excluded from our business segments for purposes of performance assessment represent income or expenses that do not reflect,
`according to established company-defined criteria, operating income or expenses associated with our core business activities.
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`We do not discretely allocate assets to our operating segments, nor does our chief operating decision maker evaluate operating
`segments using discrete asset information.
`
`See Note 17, “Business Segment Information,” in the notes to the consolidated financial statements listed under Item 15 of Part IV of
`this report, “Exhibits and Financial Statement Schedules,” for further information concerning our foreign and domestic operations.
`
`Specialty Pharmaceuticals Segment
`
`Eye Care Pharmaceuticals Product Line
`
`We develop, manufacture and market a broad range of prescription and non-prescription products designed to treat diseases and
`disorders of the eye, including chronic dry eye, glaucoma, inflammation, infection, allergy and retinal disease.
`
`Chronic Dry Eye
`
`Restasis (cyclosporine ophthalmic emulsion) 0.05% is the first, and currently the only, prescription therapy for the treatment of
`®
`chronic dry eye worldwide. Restasis is our best selling eye care product. Chronic dry eye is a painful and irritating condition involving
`®
`abnormalities and deficiencies in the tear film initiated by a variety of causes. The incidence of chronic dry eye increases markedly with
`age, after menopause in women and in people with systemic diseases such as Sjögren’s syndrome and rheumatoid arthritis. Until the
`approval of Restasis , physicians used lubricating tears to provide palliative relief of the debilitating symptoms of chronic dry eye. We
`®
`launched Restasis in the United States in 2003 under a license from Novartis AG for the ophthalmic use of cyclosporine. During the third
`®
`quarter of 2010, Health Canada approved Restasis for the treatment of moderate to moderately severe aqueous deficient dry eye disease.
`®
`Restasis is currently approved in 41 countries.
`®
`
`Our over-the-counter artificial tears products, including the Refresh and Refresh Optive brands, treat dry eye symptoms including
`®
`®
`™
`irritation and dryness due to pollution, computer use, aging and other causes. Refresh , launched in 1986, includes a wide range of
`®
`preserved and non-preserved drops as well as ointments to treat dry eye symptoms. According to IMS Health Incorporated, an independent
`marketing research firm, our artificial tears products, including the Refresh and Refresh Optive brands, were again the number one
`®
`®
`™
`selling artificial tears products worldwide for the first nine months of 2010.
`
`Glaucoma
`
`The largest segment of the market for ophthalmic prescription drugs is for the treatment of glaucoma, a sight-threatening disease
`typically characterized by elevated intraocular pressure leading to optic nerve damage. Glaucoma is currently the world’s second leading
`cause of blindness, and we estimate that over 70 million people worldwide have glaucoma. According to IMS Health Incorporated, our
`products for the treatment of glaucoma, including Lumigan (bimatoprost ophthalmic solution) 0.03%, Lumigan 0.01%, Ganfort
`®
`®
`™
`(bimatoprost/timolol maleate ophthalmic solution), Alphagan (brimonidine tartrate ophthalmic solution) 0.2%, or Alphagan , Alphagan
`®
`®
`®
`P 0.15%, Alphagan P 0.1% and Combigan (brimonidine tartrate/timolol maleate ophthalmic solution) 0.2%/0.5%, captured
`®
`®
`approximately 26.2% of worldwide market sales in their product categories for first nine months of 2010.
`
`Lumigan 0.03% and Lumigan 0.01% are topical treatments indicated for the reduction of elevated intraocular pressure in patients
`®
`®
`with glaucoma or ocular hypertension. Lumigan 0.01% is an improved reformulation of Lumigan 0.03%. We currently sell Lumigan
`®
`®
`®
`0.01% and Lumigan 0.03% in the United States and over 75 countries worldwide and, together, they are our second best selling eye care
`®
`products. According to IMS Health Incorporated, Lumigan 0.01% and Lumigan 0.03% were amongst the best selling glaucoma products
`®
`®
`in the world for the first nine months of 2010. In 2002, the European Commission approved Lumigan
`®
`
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`0.03%. In 2004, the European Union’s Committee for Proprietary Medicinal Products approved Lumigan 0.03% as a first-line therapy for
`®
`the reduction of elevated intraocular pressure in chronic open-angle glaucoma and ocular hypertension. In 2006, the U.S. Food and Drug
`Administration, or the FDA, approved Lumigan 0.03% as a first-line therapy. We are party to an exclusive licensing agreement with
`®
`Senju Pharmaceutical Co., Ltd., or Senju, under which Senju became responsible for the development and commercialization of Lumigan
`®
`0.03% in Japan. In 2009, Senju received approval of Lumigan 0.03% in Japan. Also in 2009, Lumigan 0.01% was approved by Health
`®
`®
`Canada. In the first quarter of 2010, the European Commission granted a Marketing Authorization for Lumigan 0.01% in the European
`®
`Union member states. During the third quarter of 2010, the FDA approved Lumigan 0.01% as a first-line therapy indicated for the
`®
`reduction of elevated intraocular pressure in patients with open-angle glaucoma or ocular hypertension. In 2006, we received a license
`from the European Commission to market Ganfort
` in the European Union. Ganfort
` is now sold in over 37 countries outside the United
`™
`™
`States. Combined sales of Lumigan 0.03%, Lumigan 0.01% and Ganfort
` represented approximately 11%, 10% and 10% of our total
`®
`®
`™
`consolidated product net sales in 2010, 2009 and 2008, respectively.
`
`Our third best selling eye care products are the ophthalmic solutions Alphagan , Alphagan P 0.15% and Alphagan P 0.1%. These
`®
`®
`®
`products lower intraocular pressure by reducing aqueous humor production and increasing uveoscleral outflow. Alphagan P 0.15% and
`®
`Alphagan P 0.1% are improved reformulations of Alphagan containing brimonidine, the active ingredient in Alphagan , preserved with
`®
`®
`®
`Purite . We currently market Alphagan , Alphagan P 0.15% and Alphagan P 0.1% in over 70 countries worldwide. In 2002, based on
`®
`®
`®
`®
`the acceptance of Alphagan P 0.15%, we discontinued the U.S. distribution of Alphagan . We are party to an exclusive licensing
`®
`®
`agreement with Senju, under which Senju is responsible for the development and commercialization of Alphagan and Alphagan P
`®
`®
`0.15% in Japan. The marketing exclusivity period for Alphagan P 0.1% expired in 2008 and Alphagan P 0.15 % now faces generic
`®
`®
`competition in the United States, although we have a number of patents covering the Alphagan P 0.1% and Alphagan P 0.15%
`®
`®
`technology that extend to 2022 in the United States. In 2003, the FDA approved the first generic of Alphagan . Additionally, a generic
`®
`form of Alphagan is sold in a limited number of other countries, including Canada, Mexico, India, Brazil, Colombia, Argentina and in the
`®
`European Union.
`
`We also developed the ophthalmic solution Combigan , a brimonidine and timolol combination designed to treat glaucoma and
`®
`ocular hypertension in patients who are not responsive to treatment with only one medication and are considered appropriate candidates
`for combination therapy. In 2005, we received positive opinions for Combigan from 20 concerned member states included in the
`®
`Combigan Mutual Recognition Procedure for the European Union, and we launched Combigan in the European Union during 2006. In
`®
`®
`2007, the FDA approved Combigan and we launched Combigan in the United States. Combigan is now sold in 67 countries
`®
`®
`®
`worldwide. Combined sales of Alphagan , Alphagan P 0.15% and Alphagan P 0.1% and Combigan represented approximately 8%,
`®
`®
`®
`®
`9% and 9% of our total consolidated product net sales in 2010, 2009 and 2008, respectively.
`
`Inflammation
`
`Our ophthalmic anti-inflammatory product Acuvail (ketorolac tromethamine ophthalmic solution) 0.45%, an advanced unit-dose
`®
`preservative-free formulation of ketorolac for the treatment of pain and inflammation following cataract surgery, was approved by the
`FDA in 2009. Our ophthalmic anti-inflammatory product Acular LS (ketorolac ophthalmic solution) 0.4% is a version of Acular that has
`®
`®
`been reformulated for the reduction of ocular pain, burning and stinging following corneal refractive surgery. Acular PF was the first
`®
`preservative-free topical non-steroidal anti-inflammatory drug in the United States. Acular PF is indicated for the reduction of ocular
`®
`pain and photophobia following incisional refractive surgery. In 2009, the FDA approved seven Abbreviated New Drug Applications, or
`ANDAs, for ketorolac tromethamine ophthalmic solution 0.5%, a generic version of Acular and Acular LS . Acular and Acular LS
`®
`®
`®
`®
`now face generic competition. Our ophthalmic anti-inflammatory product Pred Forte remains a leading topical steroid worldwide based
`®
`on 2010 sales. Pred Forte has no patent protection or marketing exclusivity and faces generic competition.
`®
`
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`Infection
`
`Our leading anti-infective is Zymar (gatifloxacin ophthalmic solution) 0.3%, which we license from Kyorin Pharmaceutical Co.,
`®
`Ltd. and have worldwide ophthalmic commercial rights excluding Japan, Korea, Taiwan and certain other countries in Asia and Europe.
`We launched Zymar in the United States in 2003. Zymar is a fourth-generation fluoroquinolone for the treatment of bacterial
`®
`®
`conjunctivitis and is currently approved in 33 countries. Laboratory studies have shown that Zymar kills the most common bacteria that
`®
`cause eye infections as well as specific resistant bacteria. During the second quarter of 2010, we received FDA approval of Zymaxid
`®
`(gatifloxacin ophthalmic solution) 0.5%, our next-generation anti-infective product indicated for the treatment of bacterial conjunctivitis.
`In February 2011, we announced the discontinuation of Zymar due to strong physician acceptance of Zymaxid with its increased
`®
`®
`concentration.
`
`Allergy
`
`The allergy market is, by its nature, a seasonal market, peaking during the spring months. We license Elestat from Boehringer
`®
`Ingelheim AG, and hold worldwide ophthalmic commercial rights excluding Japan. Elestat is used for the prevention of itching
`®
`associated with allergic conjunctivitis. We launched Elestat in Europe under the brand names Relestat and Purivist during 2004, and
`®
`®
`®
`Inspire Pharmaceuticals, Inc., or Inspire, our marketing partner in the United States, launched Elestat during 2004. Elestat (together with
`®
`®
`sales under its brand names Relestat and Purivist ) is currently approved in 49 countries. In the third quarter of 2010, we acquired from
`®
`®
`Vistakon Pharmaceuticals, LLC, Janssen Pharmaceutica N.V., Beerse and Johnson & Johnson Vision Care Inc., or, collectively, Vistakon,
`the global license to manufacture and commercialize alcaftadine 0.25%, a topical allergy medication for the prevention and treatment of
`itching associated with allergic conjunctivitis. Alcaftadine is FDA-approved in the United States under the brand name Lastacaft
`™
`(alcaftadine ophthalmic solution) and was commercialized in January 2011.
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`Retinal Disease
`
`Ozurdex is a novel bioerodable formulation of dexamethasone in our proprietary Novadur sustained-release drug delivery system
`®
`™
`that can be used to locally and directly administer medications to the retina. In 2009, the FDA approved Ozurdex (dexamethasone
`®
`intravitreal implant) 0.7 mg, as the first drug therapy indicated for the treatment of macular edema associated with branch retinal vein
`occlusion or central retinal vein occlusion. We launched Ozurdex in the United States in 2009. In the third quarter of 2010, the European
`Medicines Agency granted marketing authorization for Ozurdex in the 27 member states of the European Union, making Ozurdex the
`®
`first licensed treatment in Europe for macular edema in patients with retinal vein occlusion. Also in the third quarter of 2010, the FDA
`approved Ozurdex for the treatment of non-infectious ocular inflammation, or uveitis, affecting the posterior segment of the eye.
`®
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`Neuromodulator
`
`Botox
`®
`
`Our neuromodulator product, Botox (onabotulinumtoxinA), has a long-established safety profile and has been approved by the FDA
`®
`for more than 20 years to treat a variety of therapeutic conditions, as well as for aesthetic use since 2002. In 2010, therapeutic uses
`accounted for approximately 51% and aesthetic uses for approximately 49% of total sales. With more than 2,000 publications on Botox
`®
`and Botox Cosmetic in scientific and medical journals, results of approximately 50 randomized, placebo-controlled clinical trials
`®
`involving more than 11,000 patients, Botox is a widely researched medicine with more than 100 potential therapeutic and aesthetic uses
`®
`reported in the medical literature. Over 18 million treatment sessions have been recorded with Botox and Botox Cosmetic in the United
`®
`®
`States alone over the past 16 years (1994-2009). Marketed as Botox , Botox Cosmetic, Vistabel , Vistabex or Botox Vista depending on
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`®
`®
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`the indication and country of approval, the product is currently approved in approximately 80 countries for up to 21 unique
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`indications. In 2009, following the approval of a competitor product, Dysport
` in the United States, we adopted a Risk Evaluation and
`™
`Mitigation Strategies program, or REMS, including a boxed warning about the potential spread of botulinum toxins from the site of
`injection and the lack of interchangeability among botulinum toxin products. Sales of Botox represented approximately 29%, 29% and
`®
`30% of our total consolidated product net sales in 2010, 2009 and 2008, respectively. Botox has been primarily used therapeutically for
`®
`the treatment of certain neuromuscular disorders which are characterized by involuntary muscle contractions or spasms as well as upper
`limb spasticity. In the fourth quarter of 2010, the FDA approved Botox for the prophylactic treatment of headaches in adults with chronic
`®
`migraine. The approved therapeutic indications for Botox in the United States are as follows:
`®
`•
` blepharospasm, the uncontrollable contraction of the eyelid muscles which can force the eye closed and result in functional
`blindness;
` strabismus, or misalignment of the eyes, in people 12 years of age and over;
` cervical dystonia, or sustained contractions or spasms of muscles in the shoulders or neck in adults, along with associated neck
`pain;
` severe primary axillary hyperhidrosis (underarm sweating) that is inadequately managed with topical agents;
` the treatment of increased muscle stiffness in the elbow, wrist and fingers in adults with upper limb spasticity; and
` the prophylactic (preventative) treatment of headaches in adults with chronic migraine.
`
`•
`•
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`•
`•
`•
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`In many countries outside of the United States, Botox is approved for treating hemifacial spasm, spasticity associated with pediatric
`®
`cerebral palsy and upper limb spasticity in post-stroke patients. We are currently in development for Botox in the United States and
`®
`Europe for new indications, including lower limb spasticity, neurogenic overactive bladder, idiopathic overactive bladder and benign
`prostatic hyperplasia. In the third quarter of 2010, we received approval for Botox for the prophylactic treatment of headaches in adults
`®
`with chronic migraine in the United Kingdom. In 2009, we submitted regulatory files for the use of Botox to treat chronic migraine in
`®
`France, Switzerland and Canada and are currently seeking approval in the European Union. In the fourth quarter of 2010, we filed a
`supplemental Biologics License Application, or sBLA, with the FDA for the use of Botox in the treatment of urinary incontinence due to
`®
`neurogenic detrusor overactivity resulting from neurogenic bladder and we are currently seeking approval in the European Union and
`Canada. In 2010, we completed enrollment in our Phase III clinical trials for the use of Botox to treat idiopathic overactive bladder. In
`®
`2005, we initiated Phase II clinical trials outside the United States for the use of Botox to treat benign prostatic hyperplasia. In 2009, we
`®
`filed an Investigational New Drug Application with the FDA relating to the use of Botox to treat benign prostatic hyperplasia.
`®
`
`Botox Cosmetic
`®
`
`The FDA approved Botox Cosmetic in 2002 for the temporary improvement in the appearance of moderate to severe glabellar lines
`®
`in adult men and women age 65 or younger. Referred to as Botox , Botox Cosmetic, Vistabel , Vistabex or Botox Vista , depending on
`®
`®
`®
`®
`®
`the country of approval, this product is administered in small injections to temporarily reduce the muscle activity that causes the formation
`of glabellar lines between the eyebrows that often develop during the aging process. Currently, more than 60 countries have approved
`facial aesthetic indications for Botox , Botox Cosmetic, Vistabel , Vistabex or Botox Vista . In Australia, New Zealand, Canada and
`®
`®
`®
`®
`®
`certain countries in East Asia and Latin America, we have regulatory approvals for upper facial lines, including crow’s feet. Since we have
`launched Botox Cosmetic, we have conducted comprehensive direct-to-consumer marketing campaigns in the United States. We continue
`®
`to sponsor aesthetic specialty physician training in approved countries to further expand the base of qualified physicians using Botox ,
`®
`Botox Cosmetic, Vistabel , Vistabex or Botox Vista .
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` In 2005, we entered into a long-term arrangement with GlaxoSmithKline, or GSK, under which GSK agreed to develop and promote
`Botox in Japan and China and we agreed to co-promote GSK’s products Imitrex STATdose System (sumatriptan succinate) and Amerge
`®
`®
`®
`(naratriptan hydrochloride) in the United States until the third quarter of 2010. In the first quarter of 2010, we reacquired the rights from
`GSK to develop and sell Botox in Japan and China for all current and future cosmetic indications. GSK retains the rights granted under
`®
`the long-term arrangement to develop and sell Botox in Japan and China for all current and future therapeutic indications. In 2009,
`®
`Botox was approved in Japan for the additional indications of