Judy L. Brown - Chief Financial Officer, Chief Accounting Officer and Executive Vice President Arthur J. Shannon - Vice President of Investor Relations & Communication Joseph C. Papa - Chairman, Chief Executive Officer and President

Sumant S. Kulkarni - BofA Merrill Lynch, Research Division Ami Fadia - UBS Investment Bank, Research Division Randall Stanicky - Canaccord Genuity, Research Division Elliot Wilbur - Needham & Company, LLC, Research Division Jon Andersen - William Blair & Company L.L.C., Research Division David G. Buck - Buckingham Research Group, Inc. Frank H. Pinkerton - SunTrust Robinson Humphrey, Inc., Research Division Louise A. Chen - Collins Stewart LLC, Research Division

Good day, my name is Demetre and I will be your conference operator today. At this time, I would like to welcome everyone to the Perrigo's 2012 Earnings Conference Call. [Operator Instructions] Thank you. Mr. Shannon, you may begin your conference. Arthur J. Shannon: Thank you, very much. Welcome to Perrigo's First Quarter 2012 Earnings Conference Call. I hope you all had the chance to review our press release which we issued earlier this morning. A copy of the release is available on our website at perrigo.com. Also on our website is a slide presentation for this call. Before we proceed with the call, I'd like to remind everyone that the safe harbor language contained in today's press release also pertains to this conference call. Certain statements in this call are forward-looking statements within the meaning of Section 21 of the Securities and Exchange Act of 1934 as amended and are subject to the safe harbor created thereby. Please see the cautionary note regarding forward-looking statements on Page 1 of the company's Form 10-K for the year ended June 25, 2011. I would now like to turn the call over to Perrigo's Chairman and CEO, Joe Papa. Joe? Joseph C. Papa: Thank you, Art. And welcome, everyone, to Perrigo's First Quarter Fiscal 2012 Earnings Conference Call. Joining me today is Judy Brown, Perrigo's Executive Vice President and Chief Financial Officer. For our agenda today, I will provide a brief perspective on the quarter and the continued strength in storebrand market share growth. Then, I'll present an update regarding the ongoing integration of Paddock Laboratories. Next, Judy will go through the details of the quarter and our increased fiscal 2012 earnings guidance. Then, I will provide an in-depth update on the supply agreement we've recently signed in China and our plans for new product launches, plus an overview of our expectations for the full year. Finally, this will be followed by an opportunity for Q&A. Now, let's discuss the quarter. It was another great quarter. On Slide 4, you can see we had record first quarter sales of $725 million, plus record adjusted income from continuing operations up 27% from last year on a 13% net sales growth. On top of that, consolidated adjusted operating margin from continuing operation was 21% driven by gross margin expansion and the acquisition of Paddock Labs. We achieved a 21% adjusted operating margin notwithstanding a 31% increase in adjusted R&D investment versus last year. Turning to Slide 5, you can see the business segment breakdown. Judy will walk you through the detail, but I wanted to touch on a few items. First, our Consumer Healthcare unit had all-time record quarter first quarter sales. The performance was driven by $15 million in new product sales. The highly successful launch of fexofenadine, the store brand of Allegra, helped our new product sales. In fact, store brand penetration for fexofenadine is ramping into the mid-40% range with Perrigo having the majority share of the store brand market. The base business continues to gain market share as well. However, a delay in shipping our new analgesic suspension product that was converted to a new and improved bottle design slightly depressed the U.S. CHC growth rate, by -- in Q1 by approximately 2 percentage points. Adjusted operating margin, or income was down 9% versus last year. This was driven primarily by competitive pressures in the gastrointestinal category and promotional pre-seasonal and new product spending. We expected these pressures and the costs were factored into our plan. Therefore, we feel confident raising our earnings guidance for the rest of the fiscal year. Our Nutritional segment was down slightly from last year due to lower sales in the vitamin business. The margins in this segment were impacted by increasing commodity costs, primarily whey protein for infant formulas. We will continue to optimize our pricing and cost -- see cost efficiencies to offset the increased costs through the rest of the year. Judy will outline for you our expected margins for the full year shortly. Our Rx business had a very strong quarter as it continues to execute ahead of our expectations. The RX net sales increased 84%, and adjusted operating income grew more than 200% primarily as a result of the Paddock acquisition. Furthermore though, organic net sales grew 28% in the quarter. Our Rx team continues to execute as our competitors continue to work through their manufacturing issues. Our API segment continues to perform well driven by strong performance from the base business highlighted by robust sales of fluticasone, to new and existing customers and temozolomide in the EU. Looking at Slide 6, the overall OTC consumer market was up just 1.5% versus last year, with national brands down 2.4%, but store brands gained 11% on the strength of new product launches, national brand recall and increased market share. The analgesic category was obviously impacted by a recall at a brand name competitor. However, all of the individual store brand categories were up. Please note that this data represents the last 52 weeks of activity according to IRI. As most of you know, meeting the increasing demand for store brands has been a challenge. However, over the past year, we have added processes and procedures that have raised our level of quality, but have impacted our manufacturing throughput. Our team has worked very hard to ramp up and back to previous levels of production. I'm happy to report to you today that in Michigan, Perrigo has set production records over the past few months as we ramp up for the cough/cold/flu season raising the number of tablets we produce by more than 40% versus this time last year. It was a great job by the team. I'm sure you will have plenty of questions about our updated fiscal 2012 guidance and our market share gains, and we'll get to that detail shortly. But let me first turn it over to Judy at this time. Judy? Judy L. Brown: Thanks, Joe. Good morning, everyone. As you just heard from Joe, on a consolidated basis, we had an even stronger start to the year than we had anticipated. During the next few minutes, I'll give a brief review of our fiscal 2012 first quarter results by segment and then review our revised expectations for the fiscal year. I'd like to remind you that my comments today are based solely on adjusted results from continuing operations. You can view the reconciliations between GAAP and non-GAAP adjusted results and the table to our press release as well as the appendices to this morning’s presentation. So let's move directly into the business segment. On Slide 7, you'll note that Consumer Healthcare's first quarter net sales increased 4% year-over-year due to a combination of an increase in sales of existing products of $9 million, primarily in the cough/cold and smoking cessation category. New product sales of $15 million also primarily in the cough/cold/allergy/sinus as well analgesic and diabetes categories. And a $3 million change -- favorable change in foreign currency exchange rate. These combined increases were partially offset by a decline of $12 million in sales of existing products within the gastrointestinal product category driven by competitive pressures on a key product, which, as Joe mentioned previously, was built into our annual planning. Excluding G.I., revenue for the remaining product categories within our Consumer Healthcare segment grew year-over-year in the first quarter. The 90 basis-point decrease to adjusted gross profit margin was driven by a combination of the market pressure I just noted in the G.I. category and investment activity in plant capacity in preparation for several key product launches as we expect in the second half of the fiscal year. Despite these increases, the metrics we track closely with respect to factory throughput, production volumes, scrap and oplasecence all improved from this time last year. Adjusted operating margin decreased 230 basis points year-over-year in part due to a planned increase in research and development and higher Paragraph IV litigation expenses. Given the strength of the total Perrigo portfolio this quarter, we were able to invest incrementally year-over-year on SG&A initiatives within the segment, primarily marketing costs through social media and market research activities as well as targeted variable compensation costs. On Slide 8, you can see that net sales within the Nutritional segment declined 2% year-over-year mainly due to the VMS product category. Net sales in the other product categories within this segment grew slightly year-over-year and pricing remained relatively favorable. So birthrates in the U.S. continue to contract given the sustained economic uncertainty, store brand infant formula continue to gain market share. The adjusted gross margin in the Nutritional segment decreased 330 basis points year-over-year due to increased cost of raw material for infant formula, such as whey protein as well as product mix within the infant food and formula category. While consumers have been moving more to the store brand offering as evidenced by the increased market share data, they have been also purchasing more of the higher volumes, larger-sized SKUs, slightly lower-priced formula and food products versus this time last year. We have been able to address the component of the cost increases seen through pricing initiatives and we'll need to maintain this focus if material pricing challenges remain. However, I'd like to add that VMS contributed positively to the segment's adjusted growth margin despite experiencing a year-over-year decline in revenue, as both product mix and manufacturing efficiencies have continued to improve. In addition to the adjusted gross margin decline, an incremental $1 million R&D investment in infant formula clinical trials, which we chose to make this quarter, contributed to the 400 basis-point decrease in the segment's adjusted operating margin. Now, turning to slide 9. You can see that the Rx business has started off fiscal 2012 spectacularly, outperforming our expectations. Net sales growth of 84% was due primarily to a combination of sales of $39 million from the July 26 acquisition of Paddock lab, new product sales of $5 million, and strong gains in our organic Rx business. Adjusted gross profit for the quarter was strong compared to last year due to the same 3 reasons. The adjusted operating margin increase of 1,860 basis points, was largely a factor of the significant increase in adjusted gross margins driven by new products, production leverage and stability in the existing organic portfolio. Although the team had higher R&D and DSG&A expenses with the inclusion of Paddock this quarter, incremental improvement to adjusted operating margin were evident through the leverage of these costs on the higher net sales base. Needless to say, the continued integration of Paddock Labs is a high priority for the team right now. Next, on Slide 10, you'll see that API's first quarter net sales were up 28% compared to last year with the growth driven by a combination of: Solid demand for key existing products in the portfolio of $5 million, new product sales of $3 million, and favorable changes in foreign currency exchange rates of $2 million. Specifically, sales of fluticasone and the European temozolomide were major drivers of the 80 basis-point expansion in adjusted gross margin. These 2 products and continued expense control collectively help to drive a 280 basis-point increase in adjusted operating margin this quarter. Now, some quick highlights on our balance sheets. Excluding cash and current investments, working capital from continuing operations was $560 million at the end of the quarter, up from $387 million at this time last year. $60 million, or approximately 1/3 of this increase is directly related to the acquisition of Paddock Labs within the quarter. The remaining increase is due to the growth in the organic business and production constraints experienced at this time last year. As of September 24, 2011, total current and long-term debt on the face of the balance sheet was $1.2 billion; this is up sequentially from $893 million at the end of fiscal 2011, primarily due to the July 26 addition of a $250 million term loan to fund the Paddock acquisition. Excluding cash and cash equivalents, our net debt to total capital at the end of our first quarter fiscal 2012 was 41.2%. Net cash flow from operation for the first quarter was $54 million, up from first quarter 2011 due to changes in deferred tax balances related to taxes paid in foreign jurisdiction. And now, I'd like to discuss our updated earnings outlook for the full-year 2012. As a reminder, our earnings outlook is based on adjusted financials from continuing operations, which excludes field [ph] related amortization as well as certain acquisition-related charges. First, on Slide 11, you'll see that we're updating guidance from the Nutritionals and Rx pharmaceuticals segments, while our expectation for full-year deliverables on the other 2 segments remain unchanged from August. For Nutritionals, we now predict the revenue to grow 3% to 5% over fiscal 2011, and anticipate fiscal 2012 adjusted gross margin between 31% and 33%, with adjusted operating margins between 15% and 17%. Please note that this new revenue assumption excludes any incremental revenue from our recently-announced partnership with Founder Pharma. While we do expect to begin shipping product in this fiscal year, it is still too early to provide you a meaningful estimate of either first year volumes or timing. So, as is our custom, we will give you more color, and as needed, update our numbers to reflect the Founder transaction once we have more specific detail to share. So, the changes in this Nutritional guidance I just noted here are due to a lower revenue contribution from VMS, higher cost of raw materials and product mix. For Rx, we now anticipate top line growth between 69% and 71% compared to fiscal 2011, driven by Paddock Labs and an expectation that the strong performance of the organic Rx business will continue beyond the first quarter. We're now anticipating Rx adjusted gross margin to be in a range of 55% to 57%, and adjusted operating margin to be in a range of 41% to 43%. Summing everything up, back at the consolidated level on Slide 12, we now expect year-over-year revenue growth to be in a range of 17% to 20%. This increase will be driven by Paddock and our growth in the base business. We continue to estimate adjusted consolidated gross margin of between 35% and 38%, and an adjusted consolidated operating margin range of between 20% and 22%. Moreover, as we realized an $0.08 adjusted earnings per share tax benefit in the first quarter, due to the resolution of various tax audits and statute expiries, we now expect a worldwide effective tax rate range from continuing operations of between approximately 27% and 29%. This is down from our August estimation due to the first quarter tax benefit and some changes in the income mix by the business units I just mentioned. In total, this brings us to an estimate of adjusted diluted earnings per share from continuing operations of between $4.65 and $4.80. With respect to cash flow from operations, we now expect fiscal 2012 cash flow from operations to be in between $500 million and $530 million, up from our previous range of $470 million to $500 million on the increased income estimate. We also now expect that capital expenditures will range between $90 million and $110 million as we have have multiple projects underway in Vermont, Israel, India and Michigan, as well as integration-related activities in Minnesota and Virginia. This quarter, more than most previous quarters, highlights the power of our diversified growth strategy and the abilities to sustain and grow earnings on a consolidated basis. We tenaciously continue on our journey of growth, execution and continuous improvement, and remain focused on seizing opportunities to expand the promise of quality, affordable healthcare. Now, I'd like to turn the call back to Joe. Joseph C. Papa: Thank you, Judy. As Judy just outlined for you, we had a great quarter 1. But now, I want to focus on the future. This year, we are planning on launching over 45 new products that we expect will translate into more than $190 million in annual Perrigo sales, as you could see on Slide 13. In our Consumer Healthcare business, essentially, we plan to launch approximately 4 new products every month, or essentially 1 per week in fiscal 2012. We plan to launch Lansoprazole, the generic version of Prevacid, with annual branded sales of approximately $223 million. We also expect to launch Guaifenesin ER, the generic version of Mucinex with annual brand sales of approximately $150 million. The generic Rx business is growing as we integrate Paddock Laboratories into the Perrigo family. We are poised for a strong new product year, highlighted on Slide 14 by the generic versions of Duac, Xyzal, Cenestin, and Clobex lotion, which have combined brand sales of more than $480 million. Add to this, the continued growth in our ORX products in our Rx-based business, which continues to grow as competitors work through manufacturing issues, and we expect to have a terrific year ahead for Rx team. In our Nutritional business, we are excited about the launch of a store brand version of Align, a digestive supplement, which had annual branded sales of approximately $85 million. And importantly, we're also on track to launch the store brand version of Gerber Gentle, with branded sales of over $50 million. Finally, our global expansion continues. Slide 15 highlights the supply agreement we announced last week with the Founder Pharma Company. Perrigo will supply Founder Pharma premium-branded infant formula manufactured in our U.S. facilities for sale and distribution under the Founder Pharma brand in China. Under the non-exclusive agreement, we will manufacture and package the product at our U.S. facility, then sell it to Founder Pharma. They'll take delivery in the U.S., and will be responsible for shipping, net marketing sales, and distribution of the premium brand infant formula. Perrigo anticipates, realizing sales margins at or above our corporate average. We expect to be in shipment in the next 3 to 6 months. We're very excited about this deal. Founder Pharma is the type of partner we've been in search of in China. Founder Pharma is a well-known conglomerate that owns medical centers along with pharmaceutical manufacturing and API production. I look forward to giving you updates on the progress of this agreement and other potential partnerships throughout the remainder of the year. As I highlighting in-depth at our Investor Day last month, the Perrigo team has a strong business development pipeline and plans to expand our geographic footprint. We are looking for additional partners in China and Europe. In summary, we had another great quarter. Looking toward the rest of the year, we are increasing our full-year guidance based on strong new product pipeline and efficiency gains in our production. The market continues to recognize the value of store brand, and our Rx business continues to beat our expectation. Perrigo is truly the right company, in the right place, at the right time. Operator, let's now open up the call for questions, please.

[Operator Instructions] And your first question comes from the line of Ami Fadia with UBS. Ami Fadia - UBS Investment Bank, Research Division: I've got a couple of questions. First of all, on the Consumer Healthcare business. You indicated that 2% of the growth was missed because of a delay in shipment. But even if I factor that in, I think expectations were a little bit higher than what -- was reported in the quarter. Could you give us a sense of how you see the progression of the Consumer Healthcare business over the course of the year? And how much of it is organic growth of the base business versus new launches that I expected for the year? Joseph C. Papa: Sure. Well first of all, let me just, maybe just repeat a little bit about what I was saying on the 2% growth rate. We had a conversion to a new and improved analgesics suspension. That new improved bottle design is better for patients, we believe, and better for our customers. We launched that during the quarter, and there was just some delays as we get our product out the door. But certainly, we wanted to make sure that, that product will get out there in time for the cough/cold/flu season, and that indeed what we have accomplished. So, just quickly on that portion, I just wanted to make sure I'm clear on that question. Relative to the original -- the rest of the question on the CHC progression. First time I would say is, I remind you, we never guide on a quarterly basis, we guide for the full year. And relative to that full-year guidance for Consumer Healthcare, we are continuing to expect a 12% to 14% revenue growth for Consumer Healthcare, consistent with what we had said in August, consistent with what we had talked about at our September Investor's Day, but -- so there's no change in our guidance and our expectation. As you rightly pointed out, a large part of what we expect with Consumer Healthcare is the 45 new products representing $190 million, many of those though, are slated for the second half of the year, including the Mucinex products, the Lansoprazole products, the Clarinex products, there's the number of products that we expect all geared towards that second half of the year. I think that's -- was the specific part of your question. Anything else? That was -- it I'm sure. Ami Fadia - UBS Investment Bank, Research Division: No, that pretty much covered it. Maybe I'll have 2 other questions. One on the Nutritions business. Could you -- has your outlook for the PBM business growth in the U.S. changed in the last couple of months as you've seen the business perform? Or do you still think that it can grow at sort of high single digits? And my understanding was that you think that it can grow at 7% to 8% on an ongoing basis? And then also maybe some comment on the gross margin side? And then my third question -- was just on whether the tax rate is sustainable into next year? Joseph C. Papa: Okay. I'll take the Nutrition and then Judy might want to comment on the tax rate question. First, on the PBM business, we are still very optimistic about the PBM business. As we stated in the business review that Judy had, we are lowering this year's growth prospects, slightly down to 3% to 5% for this quarter, I mean our comment this quarter. Let me talk about that -- a couple of reasons. And give you a couple more points around that. Number one, we are still seeing very significant store brand growth in the category. So the move to store brand continues as I outlined -- I didn't specifically talk about the data point, but infant formula is up 9.8%, store brand is up 9.8% so we are clearly gaining share as a total business for infant formula, for the category is down 2.1%. So the move from national brand to store brand, and infant formula continues at this time. And that's obviously very important reason why we feel very optimistic about the growth. However, to be clear, there is a decline in the U.S. business in terms of birthrate. We believe part of the decline in the U.S. birthrate is associated with the recent economic troubles in the economy and the recession, at least based on previous recessions that has been seen before. So we believe that's currently what's happened with the growth rate of the birth. However, at some point, we do expect that to recover. I obviously can't make specific projections on U.S. birthrate, but we do expect it will go back to previous levels. So the real other comment though on Nutrition has to be the international side. We believe the activities and the steps we are taking on international will supplement the move to store brand that we see in the U.S. and that will really bring around the full opportunity of set that we see in the infant formula. Judy, why don't you comment about the tax rate question? Judy L. Brown: Sure. As I commented on a few minutes ago, the effective tax rate in the quarter, and then our expectations for the full year were sizably impacted by the settlement of several tax audits and some statute expiries that all happened in this quarter, and that then changes the rate for the full year. If you take out that $0.08 impact in Q1, actually, our rate is still -- would still, substantively be in the original range I just quoted, that 29% to 31%. But I believe your question was more forward-looking and how to think about modeling in the future. I'd start with a point of approximately 30% like the original range I gave in August. But given the expansion opportunities we have going forward in our international business, as Joe is commenting, with the Founder Pharma business coming online, we look at the mix of new products and the sustainability of our Rx business going forward and the international components of that R&D and manufacturing that we have in Israel. I do believe that there are opportunities to sustain a rate below 30%. But again the core rate -- the core mix today is still up in that high 20s range.

Your next question comes from the line of Elliot Wilbur with Needham & Company. Elliot Wilbur - Needham & Company, LLC, Research Division: First, just with respect to the some of the changes in financial metrics in terms of the outlook for the Rx business, Joe. Maybe you could just rank order for us, some of the drivers there? I mean, obviously, pretty significant increase in terms of the top line outlook. Joseph C. Papa: Sure. Well first and foremost, the Generic Rx team has just done a fabulous job in picking up additional business, launching some new products, and then also, clearly, integrating Paddock into the business, and importantly, gaining from the ORX, certainly of the fexofenadine opportunity. So I think it's been 3 or 4 activities. Importantly, I will say, one of the comment about pricing, we have found some opportunities for pricing across the business. The best way to model Perrigo, though, is that pricing is flat up slightly for the total book of business, but there are some areas where pricing is up more, and obviously, some areas will have to be competitive and reduce pricing. But for the total book of business, we've been able to keep pricing flat to up slightly, which I think is an important part of why we've been able to increase our adjusted operating margin by essentially 200 basis points. Elliot Wilbur - Needham & Company, LLC, Research Division: Okay. And I guess just one follow-up question, kind of, with respect to some of the commentary on the OTC G.I. space. I guess when we think of the Rx generic market, obviously, when there's pricing pressure, one sort of hopes to gain share, and certainly, that doesn't necessarily appear to be the case in the OTC market. So I'm just kind of wondering sort of what's changed relatively recently here? In terms of pricing, and other than, bringing down your dollars, it doesn't really seem like that's a strategy that it's working for the other player in the market. Joseph C. Papa: Well, let me just back up a little bit on the gastrointestinal category. I'll remind you that, that category is a category where we have done very well in that category. We have had significant store brand share growth in the category over time. As you know, we've had some competitors come into that space, and it was always anticipated very much as we looked at our plan for this year that we would lose some share. And there'll be some pricing there, but it was all part of our anticipated plan, and our expectation is that we would be able to offset some of that pricing there with other opportunities in our total book of business. And indeed, that's exactly what had happened this quarter. And our expectations for the full year is very similar that we'd be able to continue to have a flat -- the pricing environment, that would be flat to up slightly across the total book of business, prepare to recognizing that in some areas, we would take some pricing concessions to be competitive.

Your next question comes the line of Collins Stewart -- I'm sorry, your next question comes from the line of Louise Chen. Louise A. Chen - Collins Stewart LLC, Research Division: Sort of a few questions. First question is just on the infant nutrition commodities cost. Basically, what's the cause of that? How long do you expect that to last? And is it in your guidance for this year, incorporated into sort of like risk adjustment for guidance? And then secondly, how sustainable is your gross margin that we saw this quarter for the remainder of the year? And then last question is just, any thoughts on your uses of cash for fiscal 2012? Joseph C. Papa: Sure. Good questions. First of all, on the infant formula, yes, it is the increase in the whey protein. We do expect to see some continued commodity pressure there. As to whether or not it will escalate, it's hard for us to exactly predict it, but we have put into our forecast the full year effect of this. As Judy noted, we have not completely captured all the potential upside in the Nutritional sales for different businesses development activity such as the Founder Pharma Group. So that would be a potential upside to our sales if we are able to bring about the incremental opportunities outside of -- just what we've done at this time period. The second part, I think, of the question was the gross margin question for the consolidated business. And as we talked about, we still believe that, that 35% to 38% gross margin for our fiscal 2012 guidance is correct, and that's really where we would continue to keep our guidance. Importantly, though, from an operating margin, we've made some very significant advances in operating margin, and that's consistent with also -- with what we have expected, despite the fact that we increased dramatically the R&D investment during the quarter. So Judy, anything that you could add to this question? Judy L. Brown: And then the last question was uses of cash? Joseph C. Papa: Okay. Thank you for clearing that. On the use of the cash -- really it's very similar to what we've done in the past. We obviously increased the dividend, that was just yesterday that we announced that, but that -- a minor use of cash. The other parts of what we would do is, obviously the business development side, we'll continue to look at opportunities for business development, and as we noted in Judy's comments, CapEx, it's a slight increase from where we talked about, certainly the range is a slight increase in the CapEx that we would continue to make the investment because the demand for the store brand consumer healthcare product continues to be very significant. As I've mentioned, we've gotten a -- approximately a 40% increase over the last year -- on the output of our Michigan facility. Really trying to keep up with the continued demand for store brand consumer healthcare products.

Your next question comes the line of Randall Stanicky with Canaccord. Randall Stanicky - Canaccord Genuity, Research Division: For the questions -- just a couple. First, we're getting a lot of questions still around J&J. I guess, Joe, can you just help clarify, is that still run rating, the gains that you've had there in the same range around $12 million and then how sticky or volatile do you think that'll be going forward? Then I have one follow-up. Joseph C. Papa: Sure. So on the J&J situation, Randall, we have projected that, that was a $100 million opportunity. That $100 million opportunity is an annual opportunity for store brand. Of that, we previously stated that we could accomplish approximately, or achieve approximately $50 million of that in the past based on our capacity. However, with the incremental capacity we are bringing online, that, we believe we can go up to approximately $75 million of annual store brand sales for that product, or that brings it up from I guess, $12.5 million, to somewhere around $18 million, $19 million a quarter for our capacity based on the new equipment that we brought in into the Perrigo facility. I will quickly point out that, that product is one of the products that was subject to a conversion to a new and improved bottle design, and that new and improved bottle design conversion depressed our sales during the quarter, as we were bringing online, the new bottle design that we expect though we will be able to ship incremental significant amounts in quarters 2, 3 for the analgesics product. Randall Stanicky - Canaccord Genuity, Research Division: Got you. Okay, that's helpful. And then another question, can you help us just, whether you quantify it or from giving us color around how well Allegra has gone for you from a store brand OTC perspective, and then guess, Joe, a bigger picture question. Do you think or do you have a sense that there are other products that Pharma, but may be being looked at, that could also kind of go the same route former GX products that could go OTC, and create, I guess, additional opportunities for you down the road? Joseph C. Papa: Sure. Couple of comments, Randall, first of all, fexofenadine, our Allegra's launch has gone very well. The product is on pace to surpass Zyrtec, which would mean it would be over a $500 million product for Sanofi, so Sanofi and Tatem has done an outstanding job of launching the Allegra product within the store brand space. We find store brand share somewhere around the mid-40s in terms of share of the total market -- fexofenadine store brand has approximately 40%, our store brand has approximately 40% of the total molecule of that sales are out there. We -- Perrigo have the majority share of that product, so we're very pleased with that, and obviously, we continue to look forward to the launch of the fexofenadine D12, which is a product that we expect to launch in the next 3 to 6 months. So, a lot of good activity there, and ones that we're very excited about in terms of launching it. On the second part of your question, in terms of other products going from prescription to OTC, we continue to believe that over the next 5 years, it will be over $10 billion of product that can move from prescription to OTC. They clearly represent the rest of the proton pump inhibitors, so the Nexium, the Protonix, the Aciphex products, all represent, we think great opportunities as they move from prescription to OTC, and we know a number of them are under development as an OTC product, so we're going to continue to try to be a fast follower in the category, obviously, the Clarinex products or the next nauseating antihistamine is a certainly also an opportunity that we expect the product to go generic in June of 2012. So at the end of our current fiscal year, we obviously believe that would be also a good Rx to OTC switch. Beyond that, there's a number of other categories that could potentially switch, the largest of which is the statin drugs, it's a little bit less clear there, but certainly there's a possibility there that those products not immediately, but say 3 to 4 to 5 years out, and then also some of the products that are for the treatment of overactive bladder, we think are also important candidate, and some of the non-oral products for pain relief, we think could also be important product that could move from prescription to OTC.

Your next question comes of the line of David Brock for Buckingham research. David G. Buck - Buckingham Research Group, Inc.: Just a couple of quick ones. First on the overall revenue line, it looks like you're about $27 million, light of our estimate, and $22 million below consensus. If I take the 2% delay, that's about $13 million. Can you talk about in Nutritionals or Consumer Health, were there any sort of one-time type hits or not? And then for the Nutritionals business, can you give the number for BFN Nutrition this quarter, and then just so I understand what's in the guidance going forward for the rest of the year, can you talk about what the assumption is for J&J going back in, and what the assumption is on the Founder Pharma, it sounds like it's being left out, but is that potentially a meaningful upside, and you just don't the number, or you just don't think that the sales will be meaningful? Joseph C. Papa: David, you asked about 5 or 6. I'll try to get all of them, but if I miss any I'll let you know -- yes. First of all, we -- I think the comment I have to make is -- we obviously, don't guide on a quarterly basis, we guide on annual basis. And relative to our full-year guidance in terms of the company, as Judy talked about, the revenue growth -- we actually increased revenue growth for consolidated Perrigo from 15% to 18%, up to 17% to 20%, so that's clearly an increase on that guidance. Having said that, though, as we talk about the individual business segment, really the Consumer Healthcare revenue growth is the -- consistent with where we were last August or in August, a couple of months ago now. The only one we decreased was the Nutritional slightly, and we've raised the RX. So, on the page that Judy outlined, just a reminder that we don't guide quarterly, however we've -- have increased Rx, slightly decreased the Nutritionals and Consumer Healthcare, really no change there in terms of our guidance. On the next comment -- I want to make -- clear one comment on, you made relative to the Consumer Healthcare, the store brand, analgesic product, I think you're $13 million number is a little high, because that was a specific to the U.S. OTC business. So that's a little bit high in terms of your comments there to be clear. On the question of Founder Pharma, we, at this point believe it is a very good opportunity -- significant opportunity, however in terms of how it's going to get up and running, and the pacing which it gets up and running, it's not entirely clear to us at this time, so we do expect will be shipping products in the next 3 to 6 months. The question of exactly the magnitude is really the reason why, as Judy stated, we kind of said "Let's put that to the side right now, that could be a potential upside, but we really want to see those orders and understand the slope of which the uptake will occur before we get too much into that number at this time." Judy L. Brown: I guess I'd just add a little color on that. Don't read anything insidious into it, it's just our -- as you know, our mantra is, we provide information when we feel like we have a clear line of sight, and as soon as we have that, we will give you color into it. Joseph C. Papa: Absolutely. Thank you. David G. Buck - Buckingham Research Group, Inc.: Okay. And just a follow up, and I guess on the MacNeil shortage. What was your -- remind us what the assumption was when they come back, and it looks they have come back on some products, and what do you expect the impact to be on your own, sort of, share that you had taken, how much to get back yourself? Joseph C. Papa: Sure. J&J we expect to reenter with the liquid in this current quarter, our quarter 2, and we expect that the J&J oral products will begin reentering in quarter 3, which is the January through March quarter for us. With anticipation of that, they'll be fully back in by the end of that quarter 3 -- 4, I'm sorry. The March timeframe is our current expectation. Relative to the retention of the business for us -- once again I remind you that we have stated upfront when people move from national brand to store brand, we retain approximately 90% -- 91% of those patients, however, in the case of when they move or they're forced to move, we retain approximately half, in the case of question of analgesic recall such as this, so we expect we'll retain approximately half of the business that had come to us from the J&J recall. David G. Buck - Buckingham Research Group, Inc.: And just one final. What was the number for infant nutrition in the quarter? Joseph C. Papa: We don't give out individual numbers David as you know in any category like that, but it was -- we clearly think there's an upside for it for the next quarter. [indiscernible] get through this conversion that it was just a natural part of plan.

Your next question comes from the line of Sumant Kulkarni with Bank of America Merrill Lynch. Sumant S. Kulkarni - BofA Merrill Lynch, Research Division: It's Sumant for Gregg. First question is on the Consumer Health business. So now that you've seen the same competitor in the G.I. space and in the fexo space, and you said that the competition has been, as expected, but do you think they could be taking a more strategic view point on the overall over-the-counter space becoming bigger? Joseph C. Papa: Sure. My -- our view is, right now the -- all the things that have played out in the Consumer Healthcare space has as expected, I think that I remind you on omeprazole, we still have over an 80% market share of the omeprazole picture -- overall omeprazole store sales, so everything -- we think is played out as we expected. Do I think that they have a strategic goal in OTC? It's hard for me to really comment of their goal. I expect that they will come after products that are moving from prescription to OTC, but I don't see them coming after any other categories, other than if they've had a -- ANDA for a product that was a prescription and coming into OTC. I don't see them in the other categories at this time. Sumant S. Kulkarni - BofA Merrill Lynch, Research Division: And again on the Michigan facility, you mentioned that it's been at record-production level recently. So do you think your CapEx spend outlook and composite -- and the expansion of that facility, or do you think you would need a step change at some point, or just to capitalize on all of the opportunities that are out there? Joseph C. Papa: I think, as Judy said, we are going to slightly increase the opportunity for our CapEx, so we will be spending some incremental capital relative to the store brand opportunity, but also some of the opportunities we see in infant formula, and also in the API business, and also in the Rx business, and so it's a -- looking at the total book of business, but I don't see it being a step function different, I see it more as just some incremental spend, and then -- Judy, do you want make any more comment? Judy L. Brown: And as we talked about a little at Analyst Day, what we have been always strategically striving for with respect to expansion of our footprint has been, how do we utilize the real estate, the physical plant that we have, and as you know we have the ability to expand on our campuses, globally to be able enhance the production volume expend, our packaging ability etc. So between our campuses in the U.S., in Israel, specifically, both into that $90 million to $110 million range for this year. Our intention is to be able to continue to expand. So we don't necessarily need to have a completely separate facility in order to be able to continue our expansion of capacity for the company. Sumant S. Kulkarni - BofA Merrill Lynch, Research Division: And on the Infant Formula business, you mentioned earlier that the U.S. growth rate have been declining, so should we think about the U.S. growth for that -- as lower than the double digits that were previously cited? Joseph C. Papa: Well, I think we previously talked about, in terms of the growth rate was, as Judy outlined, we expected the growth rate for the total Nutritional business to be 3% to 5%. It's going to be composed of a couple of things: Gaining incremental store brand share as per our previous comments, but also recognizing that the total category is going to be down approximately 2%. So it recognizes both gains and store brand share, but also the overall decline in the birthrate in the United States. Sumant S. Kulkarni - BofA Merrill Lynch, Research Division: And my last question around the API business. You quote of fluticasone as one of the products that you shipped out. Was that for a state formulation or other types of formulation? Joseph C. Papa: Yes, I don't think I'm going to go specifically go into that comment. It was certainly a good opportunity for us, fluticasone, both with new and existing customers. But I don't really probably want to make much more comment beyond that. The other part of the course, that was very important to us, was the temozolomide in the European Union. So both of those products I think had a very important foundation for us.

[Operator Instructions] Your next question comes the line of Frank Pinkerton with SunTrust. Frank H. Pinkerton - SunTrust Robinson Humphrey, Inc., Research Division: Can you speak to -- your infant formula division, you made a comment with whey prices up, that you were going about taking price increases. Since you did the acquisition, there's kind of been a theory out there that overall store branded infant formula is priced at too large of a spread discount versus the branded products? Is this an opportunity to narrow that spread and actually get closer to what some others think should be the appropriate price in infant formula for store brands? Joseph C. Papa: Sure. We do believe that the spread at approximately 50% difference between the national brand and the store brand infant formula product is a very significant spread. It is more than the usual spread we have of about 30% in most of the OTC products. We still believe there is some opportunity for pricing, we have taken some pricing to be clear, but we will always continue to reassess that pricing environment. And as I've said before, I think what's important for us at Perrigo, as we look at the total portfolio we have, if we can keep the pricing environment flat to up slightly across the total book of business, that allows a very strong foundation so that when we launch these new products, we're well-positioned. So I guess the summation of the comment is, yes, we will continue to look at pricing, we obviously believe there's some -- and that we are 1 of only 4 manufacturers of infant formula in the United States. That there is some opportunity that's really going to be looking at -- would do we do with the -- our cost component? And where we go with the pricing in total across the total Perrigo book of business as we try to evaluate where to go with the business. Frank H. Pinkerton - SunTrust Robinson Humphrey, Inc., Research Division: Can you also make a comment on the OTC to Rx switch? That was a business you talked a lot about maybe 1 year, 1.5 year ago. I know some of products are seasonal, but just how does that switch go, into something like an Allegra coming over-the-counter, give you another line -- potential to feedback in there? Or since Allegra was generic to begin with, is that not an opportunity for the behind-the-counter generic side? Joseph C. Papa: Yes. So yes, there is a -- with the Allegra product, and there is seasonality with the Allegra product, that is absolutely true. There is an ORX opportunity with Allegra, I will say one other comment that our supply of fexofenadine is improving from our manufactured tablet, that is improving. It's not quite as much as we would like, but that continues to improve. And as that improves it gives us more additional upside opportunity, not just in ORX, but across the CHC book of business as well.

Your next question comes from the line of Jon Andersen with William Blair. Jon Andersen - William Blair & Company L.L.C., Research Division: Absent the delay that you talked about in the analgesics suspension product, were CHC sales kind of in line with your expectation in the first quarter? And as you think about kind of the ramp to 12% to 14% sales growth for the year in that business, should we expect that ramp or that acceleration in Q2? Or is it more heavily back half-weighted given the sequence of new product? Joseph C. Papa: Sure. The question of the in-line, yes, we had expected it. Is there a little bit of incremental market share and pricing questions that Judy had talked about? Yes, there was a little bit of that, that we saw in the quarter, specifically to one category or product. Yes, but beyond that, really the discussion we had about our total book of business was that we were going to be -- we don't guide on a quarterly basis, but we did expect incremental sales across our company in the second half of the year. And we continue to feel that the second half of the year will be stronger than the first of the year for us as a company. Reminder that the Mucinex products -- the Guaifenesin product, the additional products that we launched with Minoxidil foam and also the Lansoprazole product, all are second half, and the Clarinex are all second half opportunities. So a number of our -- larger of new product opportunities are second half. Jon Andersen - William Blair & Company L.L.C., Research Division: Okay, that's helpful. And then on the Nutritionals business, and in kind of the adjustment to the sales outlook for the year. Just so I understand that, it sounds like that's being driven more by the VMS side of the business, not infant formula? Is that accurate? And then, can you give a little more color on VMS today, where that stands in terms of -- I know you've been going through some SKU rationalizations, but how much of where you are in terms of SKU rationalization, and maybe even kind of the competitive environment there? Joseph C. Papa: Sure. So the growth in that business -- part of what happened there is a vitamins and mineral supplement activity as we stated. The major part of it was purposeful, in the sense that we had -- we did regard it, or certainly looked at some SKUs, we're removing them out of our portfolio because they were underperforming. And that's been the important part of what we have continued to try to do as we look at it. I would say that, that total business of vitamin, mineral supplements still is at a crossroads. We believe that the potentially, that could be a better business for us, but a large part of it is going to depend on how much of that is manufactured here in the United States versus how much of it is coming in from outside the United States in terms of where that business goes. So I think that we're going to continue to monitor and look at it based on return of investment capital as we've done in the past. Jon Andersen - William Blair & Company L.L.C., Research Division: Okay. But last question just on China and infant formula. It sounds like this relationship with Founder's is a good one and one you were looking for. But it also is nonexclusive, I think you mentioned, and you're still looking for additional partners. I guess what is the Founder's relationship kind of cover and maybe what gaps still exist? And what would you be looking to fill over time? Joseph C. Papa: Yes. Good question. You picked up, and absolutely correct, it is nonexclusive, in that we think Founders is a very important customer, a very important opportunity. However, we still believe that there are some additional things we can do in terms of either a, contract manufacturing for additional company, in terms of companies that are in the market in China with a low or mid-tier brand, and is looking for a premium brand, that's one of the things we could -- think we can supply to some of the customers outside of the Founders Group. The second thing I would comment on is, that we still have our Bright Beginnings product in China, and if we can find additional ways to improve our distribution of that Bright Beginnings product, we think that would be the other significant China opportunity that we are looking to explore. In fact, I have more comments on that in the future.

Your final question is a follow-up from the line of Ami Fadia with UBS. Ami Fadia - UBS Investment Bank, Research Division: Just along the lines of the China question. Could you give us some color around what's going on with respect to the partnership right now in the sense that what is Founder Pharma's next step right now? Are they negotiating with the retailers there, or is that done? And you're at a point where you're waiting for new orders to come in? And then, just separately, having done this deal, what is your next set of priorities in terms of this development? Joseph C. Papa: Sure. Good question. We're doing a lot of the work right now with Founders to work on labels and other activities that we have to ensure that we get product to the market, as I said, in the next 3 to 6 months. So there's a lot of work that's going on there. Founders, as you know, or as I think I mentioned, has some great relationships in China, and they're looking to talk to some of those retailers, hospitals to leverage those relationships. But I probably don't want to make more comments on exactly their activities at this time. We at Perrigo are certainly getting ready for their anticipated needs in terms of building some supplies as well as working on the labeling requirements. On the comment of where else we go? As I mentioned, there's 2 opportunities: Looking for additional contract manufacturing in China for other customers for our currently approved products, but also trying to get additional distribution of our Bright Beginnings product, which we have talked about in the past where we know we need incremental distribution for Bright Beginnings in order to significantly ramp up the sales of that product, you move it from single millions of dollars to tens of millions of dollars. So those are the 2 areas that we are continuing to focus on for the China infant formula opportunity. Ami Fadia - UBS Investment Bank, Research Division: And then anything beyond China that you would identify as a prioritized opportunity for business development? Joseph C. Papa: Sure. There are other opportunities we are seeking in South America, there are other opportunities we are seeking in Europe, there are other opportunities we are seeking in Australia, we hope to have more comments on that probably in the next 3 to 6 months, but yes, we're clearly looking beyond the U.S. and China at this time.

There are no further questions. Joseph C. Papa: Thank you, very much. Operator, and everybody, thank you, very much. We appreciate your interest in Perrigo. We look forward to talking about -- in the future and the activities that we see there, the exciting opportunities for Perrigo being in the right place, right time, right company. Thank you very much, everyone.

Thank you. This concludes today's conference call. You may now disconnect.