##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549
 FORM 10-K/A
  þ
    
    Annual Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
 For the Fiscal Year Ended December 31, 2008
 o
    
    Transition Report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
 For the transition period from     to     .
 MYLAN INC.
  Pennsylvania
(State or other jurisdiction of incorporation or organization)
    
    25-1211621
(I.R.S. Employer Identification No.)
 1500 Corporate Drive, Canonsburg, Pennsylvania 15317
 Registrants telephone number, including area code:
(724) 514-1800
 Securities registered pursuant to Section 12(b) of the Act:
 Title of Each Class:
    
    Name of Each Exchange on Which Registered:Common Stock, par value $0.50 per share 
6.50% Mandatory Convertible Preferred Stock
    
    The NASDAQ Stock Market
The NASDAQ Stock Market
 Securities registered pursuant to Section 12(g) of the Act: None
 þ o
 o þ
 þ o
 o
  Large accelerated filer þ
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 o þ
   DOCUMENTS INCORPORATED BY REFERENCE
 Parts of Form 10-Kinto whichDocument isDocument
    
    IncorporatedProxy Statement for the 2009 Annual Meeting of
Shareholders, which will be filed with the Securities
and Exchange Commission within 120 days after the end
of the registrants fiscal year ended December 31,
2008.
    
    III




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Explanatory Note
  2




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##### 



MYLAN INC.
INDEX TO FORM 10-K/A
For the Year Ended December 31, 2008
 PagePART IITEM 8. Financial Statements and Supplementary Data
    
    
    4ITEM 15. Exhibits and Financial Statement Schedules
    
    
    49Signatures
    
    
    54EX-23EX-31.1EX-31.2EX-32
  3




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##### Table of Contents



ITEM 8. Financial Statements and Supplementary Data
 Index to Consolidated Financial Statements and
Supplementary Financial Information
 PageConsolidated Balance Sheets as of December 31, 2008 and December 31, 2007
    
    
    5Consolidated Statements of Operations for the Calendar Year Ended
December 31, 2008, Nine Months Ended December 31, 2007, and Fiscal Year
Ended March 31, 2007
    
    
    6Consolidated Statements of Shareholders Equity for the Calendar Year
Ended December 31, 2008, Nine Months Ended December 31, 2007, and Fiscal
Year Ended March 31, 2007
    
    
    7Consolidated Statements of Cash Flows for the Calendar Year Ended
December 31, 2008, Nine Months Ended December 31, 2007, and Fiscal Year
Ended March 31, 2007
    
    
    9Notes to Consolidated Financial Statements
    
    
    10Managements Report on Internal Control over Financial Reporting
    
    
    45Reports of Independent Registered Public Accounting Firm
    
    
    46Supplementary Financial Information
    
    
    48
 4




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MYLAN INC. AND SUBSIDIARIES
 
 Consolidated Balance Sheets
  December 31, 2008
    
    
    December 31, 2007AssetsCurrent assets:Cash and cash equivalents
    
    $
    557,147
    
    
    $
    484,202Restricted cash
    
    
    40,309
    
    
    
    Available-for-sale securities
    
    
    42,260
    
    
    
    91,361Accounts receivable, net
    
    
    1,164,613
    
    
    
    1,132,121Inventories
    
    
    1,065,990
    
    
    
    1,063,840Deferred income tax benefit
    
    
    199,278
    
    
    
    192,113Prepaid expenses and other current assets
    
    
    105,076
    
    
    
    95,664Total current assets
    
    
    3,174,673
    
    
    
    3,059,301Property, plant and equipment, net
    
    
    1,063,996
    
    
    
    1,102,932Intangible assets, net
    
    
    2,453,161
    
    
    
    2,978,706Goodwill
    
    
    3,161,580
    
    
    
    3,855,971Deferred income tax benefit
    
    
    16,493
    
    
    
    18,703Other assets
    
    
    539,956
    
    
    
    337,563Total assets
    
    $
    10,409,859
    
    
    $
    11,353,176Liabilities and shareholders equityLiabilitiesCurrent liabilities:Trade accounts payable
    
    $
    585,711
    
    
    $
    608,070Short-term borrowings
    
    
    151,109
    
    
    
    144,355Income taxes payable
    
    
    92,158
    
    
    
    169,518Current portion of long-term debt and other long-term obligations
    
    
    5,099
    
    
    
    410,934Deferred income tax liability
    
    
    1,935
    
    
    
    24,344Other current liabilities
    
    
    708,638
    
    
    
    645,130Total current liabilities
    
    
    1,544,650
    
    
    
    2,002,351Deferred revenue
    
    
    18,021
    
    
    
    122,870Long-term debt
    
    
    5,165,419
    
    
    
    4,706,716Other long-term obligations
    
    
    404,031
    
    
    
    206,672Deferred income tax liability
    
    
    545,121
    
    
    
    876,816Total liabilities
    
    
    7,677,242
    
    
    
    7,915,425Minority interest
    
    
    29,108
    
    
    
    34,325Shareholders equityPreferred stock  par value $0.50 per shareShares authorized: 5,000,000 as of December 31, 2008 and 2007Shares issued: 2,139,000 as of December 31, 2008 and 2007
    
    
    1,070
    
    
    
    1,070Common stock  par value $0.50 per shareShares authorized: 600,000,000 as of December 31, 2008 and 2007Shares issued: 395,368,062 and 395,260,355 as of December 31, 2008 and 2007
    
    
    197,684
    
    
    
    197,630Additional paid-in capital
    
    
    3,873,743
    
    
    
    3,785,729Retained earnings
    
    
    594,352
    
    
    
    922,857Accumulated other comprehensive (loss) earnings
    
    
    (380,802
    )
    
    
    83,0444,286,047
    
    
    
    4,990,330Less treasury stock  at costShares: 90,635,441 and 90,885,188 as of December 31, 2008 and 2007
    
    
    1,582,538
    
    
    
    1,586,904Total shareholders equity
    
    
    2,703,509
    
    
    
    3,403,426Total liabilities and shareholders equity
    
    $
    10,409,859
    
    
    $
    11,353,176
 See Notes to Consolidated Financial Statements
 5




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MYLAN INC. AND SUBSIDIARIES
 
 Consolidated Statements of Operations
  Calendar Year Ended
    
    
    Nine Months Ended
    
    
    Fiscal Year EndedDecember 31, 2008
    
    
    December 31, 2007
    
    
    March 31, 2007Revenues:Net revenues
    
    $
    4,631,237
    
    
    $
    2,162,943
    
    
    $
    1,586,947Other revenues
    
    
    506,348
    
    
    
    15,818
    
    
    
    24,872Total revenues
    
    
    5,137,585
    
    
    
    2,178,761
    
    
    
    1,611,819Cost of sales
    
    
    3,067,364
    
    
    
    1,304,313
    
    
    
    768,151Gross profit
    
    
    2,070,221
    
    
    
    874,448
    
    
    
    843,668Operating expenses:Research and development
    
    
    317,217
    
    
    
    146,063
    
    
    
    103,692Acquired in-process research and development
    
    
    
    
    
    
    1,269,036
    
    
    
    147,000Goodwill impairment
    
    
    385,000
    
    
    
    
    
    
    
    Selling, general and administrative
    
    
    1,053,485
    
    
    
    449,598
    
    
    
    215,538Litigation settlements, net
    
    
    16,634
    
    
    
    (1,984
    )
    
    
    (50,116
    )Total operating expenses
    
    
    1,772,336
    
    
    
    1,862,713
    
    
    
    416,114Earnings (loss) from operations
    
    
    297,885
    
    
    
    (988,265
    )
    
    
    427,554Interest expense
    
    
    357,045
    
    
    
    179,410
    
    
    
    52,276Other income, net
    
    
    11,337
    
    
    
    86,611
    
    
    
    50,234(Loss) earnings before income taxes and minority interest
    
    
    (47,823
    )
    
    
    (1,081,064
    )
    
    
    425,512Income tax provision
    
    
    137,423
    
    
    
    60,073
    
    
    
    208,017(Loss) earnings before minority interest
    
    
    (185,246
    )
    
    
    (1,141,137
    )
    
    
    217,495Minority interest (income) expense
    
    
    (4,031
    )
    
    
    (3,112
    )
    
    
    211Net (loss) earnings before preferred dividends
    
    
    (181,215
    )
    
    
    (1,138,025
    )
    
    
    217,284Preferred dividends
    
    
    139,035
    
    
    
    15,999
    
    
    
    Net (loss) earnings available to common shareholders
    
    $
    (320,250
    )
    
    $
    (1,154,024
    )
    
    $
    217,284(Loss) earnings per common share:Basic
    
    $
    (1.05
    )
    
    $
    (4.49
    )
    
    $
    1.01Diluted
    
    $
    (1.05
    )
    
    $
    (4.49
    )
    
    $
    0.99Weighted average common shares outstanding:Basic
    
    
    304,360
    
    
    
    257,150
    
    
    
    215,096Diluted
    
    
    304,360
    
    
    
    257,150
    
    
    
    219,120
 See Notes to Consolidated Financial Statements
 6




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##### Table of Contents



MYLAN INC. AND SUBSIDIARIES
 
 Consolidated Statements of Shareholders Equity
  AccumulatedAdditional
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Other
    
    
    TotalComprehensive
    
    
    Preferred Stock
    
    
    Common Stock
    
    
    Paid-In
    
    
    Retained
    
    
    Treasury Stock
    
    
    Comprehensive
    
    
    ShareholdersEarnings (Loss)
    
    
    Shares
    
    
    Cost
    
    
    Shares
    
    
    Cost
    
    
    Capital
    
    
    Earnings
    
    
    Shares
    
    
    Cost
    
    
    Earnings
    
    
    EquityBalance at March 31, 2006
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    
    
    
    
    309,150,251
    
    
    $
    154,575
    
    
    $
    418,954
    
    
    $
    1,939,045
    
    
    
    (98,971,431
    )
    
    $
    (1,727,373
    )
    
    $
    2,450
    
    
    $
    787,651Net earnings
    
    
    
    
    
    $
    217,284
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    217,284
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    217,284Foreign currency translation adjustment
    
    
    
    
    
    
    1,266
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,266
    
    
    
    1,266Net unrealized loss on marketable securities,
net of tax
    
    
    (1,569
    )Reclassification for losses included in net earnings
    
    
    669
    
    
    
    (900
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (900
    )
    
    
    (900
    )Other comprehensive earnings
    
    
    
    
    
    
    366Comprehensive earnings
    
    
    
    
    
    
    217,650Issuance of common stock, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    26,162,500
    
    
    
    13,081
    
    
    
    476,015
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    489,096Stock options exercised, net of shares tendered for payment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,048,450
    
    
    
    2,025
    
    
    
    47,242
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    49,267Sale of warrants
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    45,360
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    45,360Issuance of restricted stock, net of shares withheld
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,526
    )
    
    
    
    
    
    
    (35,665
    )
    
    
    (1,716
    )
    
    
    
    
    
    
    (4,242
    )Shares issued for the acquisition of Matrix
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    23,045
    
    
    
    
    
    
    
    8,058,139
    
    
    
    140,696
    
    
    
    
    
    
    
    163,741Purchase of bond hedge, net of tax of $44,100
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (81,900
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (81,900
    )Stock-based compensation expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,156
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    22,156Tax benefit of stock option plans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,419
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,419Dividends declared ($0.24 per share)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (53,047
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (53,047
    )Adjustment to intitially adopt SFAS No. 158, net
of tax of $751
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,272
    )
    
    
    (1,272
    )Other
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (19
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (19
    )Balance at March 31, 2007
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    339,361,201
    
    
    
    169,681
    
    
    
    962,746
    
    
    
    2,103,282
    
    
    
    (90,948,957
    )
    
    
    (1,588,393
    )
    
    
    1,544
    
    
    
    1,648,860Net loss
    
    
    
    
    
    $
    (1,138,025
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,138,025
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,138,025
    )Change in unrecognized losses and prior service
cost related to post-retirement plans, net of tax
    
    
    
    
    
    
    (663
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (663
    )
    
    
    (663
    )Foreign currency translation adjustment
    
    
    
    
    
    
    87,602
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    87,602
    
    
    
    87,602Net unrecognized losses on derivatives, net of tax
    
    
    
    
    
    
    (4,723
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,723
    )
    
    
    (4,723
    )Net unrealized loss on marketable securities,
net of tax
    
    
    (525
    )Reclassification for gains included in net earnings
    
    
    (191
    )
    
    
    (716
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (716
    )
    
    
    (716
    )Other comprehensive earnings
    
    
    
    
    
    
    81,500Comprehensive loss
    
    
    
    
    
    
    (1,056,525
    )Issuance of common stock, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    55,440,000
    
    
    
    27,720
    
    
    
    720,331
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    748,051Stock options exercised, net of shares tendered for payment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    459,154
    
    
    
    229
    
    
    
    7,503
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    7,732Issuance of preferred stock, net
    
    
    
    
    
    
    
    
    
    
    2,139,000
    
    
    
    1,070
    
    
    
    
    
    
    
    
    
    
    
    2,072,816
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    2,073,886Issuance of restricted stock, net of shares withheld
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,485
    )
    
    
    
    
    
    
    63,769
    
    
    
    1,489
    
    
    
    
    
    
    
    4Stock-based compensation expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17,332
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    17,332Tax benefit of stock option plans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,648
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,648Adoption of FIN 48, net of tax
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (11,478
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (11,478
    )Dividends on preferred shares
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (15,999
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (15,999
    )Dividends declared ($0.06 per share)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (14,923
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (14,923
    )Other
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    838
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    838Balance at December 31, 2007
    
    
    
    
    
    
    
    
    
    
    2,139,000
    
    
    $
    1,070
    
    
    
    395,260,355
    
    
    $
    197,630
    
    
    $
    3,785,729
    
    
    $
    922,857
    
    
    
    (90,885,188
    )
    
    $
    (1,586,904
    )
    
    $
    83,044
    
    
    $
    3,403,426
 See Notes to Consolidated Financial Statements
 7




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##### Table of Contents



MYLAN INC. AND SUBSIDIARIES
Consolidated Statements of Shareholders Equity (Continued)
 AccumulatedAdditional
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Other
    
    
    TotalComprehensive
    
    
    Preferred Stock
    
    
    Common Stock
    
    
    Paid-In
    
    
    Retained
    
    
    Treasury Stock
    
    
    Comprehensive
    
    
    ShareholdersEarnings (Loss)
    
    
    Shares
    
    
    Cost
    
    
    Shares
    
    
    Cost
    
    
    Capital
    
    
    Earnings
    
    
    Shares
    
    
    Cost
    
    
    Earnings
    
    
    EquityNet loss
    
    
    
    
    
    $
    (181,215
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (181,215
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (181,215
    )Change in unrecognized losses and prior service cost
related to post-retirement plans, net of tax
    
    
    
    
    
    
    (2,529
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,529
    )
    
    
    (2,529
    )Foreign currency translation adjustment
    
    
    
    
    
    
    (420,167
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (420,167
    )
    
    
    (420,167
    )Net unrecognized gains on derivatives, net of tax
    
    
    
    
    
    
    (40,633
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (40,633
    )
    
    
    (40,633
    )Net unrealized loss on marketable securities, net of tax
    
    
    (577
    )Reclassification for losses included in net earnings
    
    
    60
    
    
    
    (517
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (517
    )
    
    
    (517
    )Other comprehensive loss
    
    
    
    
    
    
    (463,846
    )Comprehensive loss
    
    
    
    
    
    $
    (645,061
    )Stock options exercised, net of shares tendered for payment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    107,707
    
    
    
    54
    
    
    
    1,137
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,191Issuance of restricted stock, net of shares withheld
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (5,529
    )
    
    
    
    
    
    
    249,747
    
    
    
    4,366
    
    
    
    
    
    
    
    (1,163
    )Stock-based compensation expense
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,639
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    30,639Tax expense of stock option plans
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (223
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (223
    )Sale of warrants, net
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    62,560
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    62,560Adoption of EITF 06-10
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (8,255
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (8,255
    )Dividends on preferred shares
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (139,035
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (139,035
    )Other
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (570
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (570
    )Balance at December 31, 2008
    
    
    
    
    
    
    
    
    
    
    2,139,000
    
    
    $
    1,070
    
    
    
    395,368,062
    
    
    $
    197,684
    
    
    $
    3,873,743
    
    
    $
    594,352
    
    
    
    (90,635,441
    )
    
    $
    (1,582,538
    )
    
    $
    (380,802
    )
    
    $
    2,703,509
 See Notes to Consolidated Financial Statements
 8




---



##### Table of Contents



MYLAN INC. AND SUBSIDIARIES
 
 Consolidated Statements of Cash Flows
  Calendar Year Ended
    
    
    Nine Months Ended
    
    
    Fiscal Year EndedDecember 31, 2008
    
    
    December 31, 2007
    
    
    March 31, 2007Cash flows from operating activities:Net (loss) earnings before preferred dividends
    
    $
    (181,215
    )
    
    $
    (1,138,025
    )
    
    $
    217,284Adjustments to reconcile net (loss) earnings before preferred
dividends to net cash provided by operating activities:Depreciation and amortization
    
    
    425,279
    
    
    
    157,800
    
    
    
    61,512Stock-based compensation expense
    
    
    30,639
    
    
    
    17,332
    
    
    
    22,156In-process research and development
    
    
    
    
    
    
    1,269,036
    
    
    
    147,000Minority interest
    
    
    (4,031
    )
    
    
    (3,112
    )
    
    
    211Net income from equity method investees
    
    
    (4,161
    )
    
    
    (2,573
    )
    
    
    (6,659
    )Change in estimated sales allowances
    
    
    10,576
    
    
    
    31,337
    
    
    
    14,386Deferred income taxes
    
    
    (193,564
    )
    
    
    (77,131
    )
    
    
    (50,479
    )Non-cash impairments
    
    
    457,517
    
    
    
    
    
    
    
    Other non-cash items
    
    
    31,076
    
    
    
    54,408
    
    
    
    7,914Litigation settlements, net
    
    
    16,635
    
    
    
    (4,526
    )
    
    
    6,464Cash received from Somerset
    
    
    
    
    
    
    
    
    
    
    5,870Gain on foreign exchange contract
    
    
    
    
    
    
    (85,063
    )
    
    
    Changes in operating assets and liabilities:Accounts receivable
    
    
    (172,447
    )
    
    
    (124,385
    )
    
    
    (60,773
    )Inventories
    
    
    (83,327
    )
    
    
    16,305
    
    
    
    (28,987
    )Trade accounts payable
    
    
    23,166
    
    
    
    86,467
    
    
    
    (29,312
    )Income taxes
    
    
    73,983
    
    
    
    (34,632
    )
    
    
    73,567Deferred revenue
    
    
    (113,998
    )
    
    
    34,864
    
    
    
    (5,504
    )Other operating assets and liabilities, net
    
    
    68,319
    
    
    
    (30,413
    )
    
    
    15,542Net cash provided by operating activities
    
    
    384,447
    
    
    
    167,689
    
    
    
    390,192Cash flows from investing activities:Capital expenditures
    
    
    (165,113
    )
    
    
    (110,538
    )
    
    
    (161,851
    )Acquisitions, net of cash acquired
    
    
    
    
    
    
    (7,001,930
    )
    
    
    (761,049
    )Increase in restricted cash
    
    
    (38,182
    )
    
    
    
    
    
    
    Purchase of available-for-sale securities
    
    
    (18,032
    )
    
    
    (275,802
    )
    
    
    (655,948
    )Proceeds from sale of available-for-sale securities
    
    
    65,712
    
    
    
    357,922
    
    
    
    848,520Other items, net
    
    
    2,785
    
    
    
    (4,976
    )
    
    
    (407
    )Net cash used in investing activities
    
    
    (152,830
    )
    
    
    (7,035,324
    )
    
    
    (730,735
    )Cash flows from financing activities:Cash dividends paid
    
    
    (137,495
    )
    
    
    (29,825
    )
    
    
    (50,751
    )Payment of financing fees
    
    
    (15,074
    )
    
    
    (89,538
    )
    
    
    (15,329
    )Proceeds from the issuance of preferred stock, net
    
    
    
    
    
    
    2,073,886
    
    
    
    Proceeds from issuance of common stock, net
    
    
    
    
    
    
    748,051
    
    
    
    657,678Purchase of bond hedge
    
    
    (161,173
    )
    
    
    
    
    
    
    (126,000
    )Proceeds from issuance of warrants
    
    
    62,560
    
    
    
    
    
    
    
    45,360Change in short-term borrowing, net
    
    
    26,239
    
    
    
    26,240
    
    
    
    Proceeds from long-term debt
    
    
    581,352
    
    
    
    7,701,240
    
    
    
    1,556,251Payment of long-term debt
    
    
    (524,536
    )
    
    
    (4,389,183
    )
    
    
    (689,938
    )Proceeds from exercise of stock options
    
    
    1,191
    
    
    
    7,732
    
    
    
    49,824Change in outstanding checks in excess of cash disburements
accounts
    
    
    
    
    
    
    18,008
    
    
    
    10,403Other items, net
    
    
    
    
    
    
    2,171
    
    
    
    5,318Net cash (used in) provided by financing activities
    
    
    (166,936
    )
    
    
    6,068,782
    
    
    
    1,442,816Effect on cash and cash equivalents of changes in exchange rates
    
    
    8,264
    
    
    
    30,690
    
    
    
    (32
    )Net increase (decrease) in cash and cash equivalents
    
    
    72,945
    
    
    
    (768,163
    )
    
    
    1,102,241Cash and cash equivalents  beginning of period
    
    
    484,202
    
    
    
    1,252,365
    
    
    
    150,124Cash and cash equivalents  end of period
    
    $
    557,147
    
    
    $
    484,202
    
    
    $
    1,252,365Supplemental disclosures of cash flow information:Cash paid during the year for:Income taxes
    
    $
    218,012
    
    
    $
    179,092
    
    
    $
    176,353Interest
    
    $
    307,895
    
    
    $
    174,034
    
    
    $
    59,996
 See Notes to Consolidated Financial Statements
 9




---



##### Table of Contents



Mylan Inc. and Subsidiaries
 
 Notes to Consolidated Financial Statements
 Note 1. Nature of Operations
 Disclosures about Segments of an Enterprise and Related Information
   Note 2. Summary of Significant Accounting Policies
 Principles of Consolidation.
  Cash and Cash Equivalents.
 Available-for-Sale Securities.
 Concentrations of Credit Risk.
   10




---



##### Table of Contents



Inventories.
 Property, Plant and Equipment.
 Intangible Assets and Goodwill.
   Impairment of Long-Lived Assets.
   Other Assets.
 Short-Term Borrowings.
 Revenue Recognition.
 11




---



##### Table of Contents



Revenue Recognition, corrected copy, Revenue Arrangements with Multiple Deliverables.
  12




---



##### Table of Contents



Research and Development.
 Income Taxes.
 (Loss) Earnings per Common Share.
   Calendar Year Ended
    
    
    Nine Months Ended
    
    
    Fiscal Year EndedDecember 31,
    
    
    December 31,
    
    
    March 31,(in thousands, except per share amounts)
    
    2008
    
    
    2007
    
    
    2007Basic (loss) earnings available to common shareholders
(numerator):Net (loss) earnings before preferred dividends
    
    $
    (181,215
    )
    
    $
    (1,138,025
    )
    
    $
    217,284Less: Preferred stock dividends
    
    
    139,035
    
    
    
    15,999
    
    
    
    Net (loss) earnings available to common shareholders
    
    $
    (320,250
    )
    
    $
    (1,154,024
    )
    
    $
    217,284Shares (denominator):Weighted average shares outstanding
    
    
    304,360
    
    
    
    257,150
    
    
    
    215,096Basic (loss) earnings per common share
    
    $
    (1.05
    )
    
    $
    (4.49
    )
    
    $
    1.01Dilutive (loss) earnings available to common shareholders
(numerator):Net (loss) earnings available to common shareholders
    
    $
    (320,250
    )
    
    $
    (1,154,024
    )
    
    $
    217,284Add: Preferred stock dividend
    
    
    
    
    
    
    
    
    
    
    Income available to common shareholders and assumed conversions
    
    $
    (320,250
    )
    
    $
    (1,154,024
    )
    
    $
    217,284Shares (denominator):Stock-based awards
    
    
    
    
    
    
    
    
    
    
    4,024Preferred stock conversion
    
    
    
    
    
    
    
    
    
    
    Total dilutive shares outstanding assuming conversions
    
    
    304,360
    
    
    
    257,150
    
    
    
    219,120Diluted (loss) earnings per common share
    
    $
    (1.05
    )
    
    $
    (4.49
    )
    
    $
    0.99
  13




---



##### Table of Contents



Stock Options. Share-Based Payment Accounting for Stock Issued to Employees Accounting for Share Based Compensation
  Foreign Currencies.
 Derivatives. Accounting for Derivative
Instruments and Hedging Activities
 Financial Instruments.
  Use of Estimates in the Preparation of Financial Statements.
 14




---



##### Table of Contents



Recent Accounting Pronouncements. Determining Whether Instruments
Granted in Share-Based Payment Transactions Are Participating Securities
 Accounting for Convertible Debt Instruments
That May Be Settled in Cash Upon Conversion (Including Partial Cash Settlement)
 Determination of the Useful Life of
Intangible Assets Goodwill and Other Intangible Assets Business Combinations ,
 Disclosures about Derivative Instruments and
Hedging Activities  an amendment of FASB Statement No. 133
 Determining
Whether an Instrument (or Embedded Feature) is Indexed to an Entitys Own Stock
 Hedging 
General: Issues Involving the Application of the Shortcut Method under Paragraph 58
 15




---



##### Table of Contents



The Fair Value Option for Financial
Assets and Financial Liabilities  including an amendment of FASB Statement No. 115 Accounting for Certain
Investments in Debt and Equity Securities
 Business Combinations
 Noncontrolling Interests in Consolidated
Financial Statements  an amendment of ARB No. 51 Consolidated Financial Statements,
 Accounting for Collateral Assignment
Split-Dollar Life Insurance Arrangements
 Accounting for Deferred Compensation and
Postretirement Benefit Aspects of Endorsed Split-Dollar Life Insurance Arrangements
 Note 3. Acquisitions
 Acquisition of the Former Merck Generics Business
  16




---



##### Table of Contents



(in thousands)Current assets (excluding inventories)
    
    $
    765,495Inventories
    
    
    645,449Property, plant and equipment, net(4)
    
    
    344,454Identified intangible assets
    
    
    2,654,163Other non-current assets(2)
    
    
    140,015In-process research and development(1)
    
    
    1,269,036Goodwill
    
    
    3,166,005Total assets acquired
    
    
    8,984,617Current liabilities(3)
    
    
    (820,444
    )Deferred tax liabilities
    
    
    (1,020,040
    )Other non-current liabilities
    
    
    (142,203
    )Net assets acquired
    
    $
    7,001,930
 
 (1)
    
    The amount allocated to acquired in-process research and
development represents an estimate of the fair value of
purchased in-process technology for research projects that,
as of the closing date of the acquisition, had not reached
technological feasibility and had no alternative future
use. The fair value of the acquired in-process technology
and research projects was based on the excess earnings
method on a project-by-project basis. This amount was
written-off upon acquisition as acquired in-process
research and development expense.(2)
    
    Included in non-current assets is $137.1 million of
receivables for the agreement of Merck KGaA under the terms
of the SPA to indemnify Mylan for certain acquired
significant litigation (see Note 19).(3)
    
    Included in current liabilities are $74.3 million of
restructuring reserves that impacted goodwill. These
estimated exit costs are associated with involuntary
termination benefits for the former Merck Generics business
employees and costs to exit certain activities of the
former Merck Generics business and were recorded as a
liability in conjunction with recording the initial
purchase price.(4)
    
    Included in property, plant and equipment are $36.4 million
of asset writedowns that have impacted goodwill. These
writedowns relate to adjusting equipment and buildings down
to their expected residual value upon their sale or
closure.   Recognition of Liabilities in Conjunction with a
Purchased Business Combination
 17




---



##### Table of Contents



Acquisition of Matrix Laboratories Limited
       18




---



##### Table of Contents



(in thousands)Current assets (excluding cash and inventories)
    
    $
    129,621Inventories
    
    
    123,000Property, plant and equipment, net
    
    
    152,580Identified intangible assets
    
    
    270,440Other non-current assets
    
    
    65,878In-process research and development(1)
    
    
    147,000Goodwill
    
    
    505,801Total assets acquired
    
    
    1,394,320Current liabilities
    
    
    (374,458
    )Deferred tax liabilities
    
    
    (106,470
    )Other non-current liabilities
    
    
    (104,045
    )Total liabilities assumed
    
    
    (584,973
    )Total minority interest
    
    
    (44,117
    )Net assets acquired
    
    $
    765,230
 
 (1)
    
    The amount allocated to acquired in-process research and
development represents an estimate of the fair value of
purchased in-process technology for research projects that,
as of the closing date of the acquisition, had not reached
technological feasibility and had no alternative future
use. The fair value of the acquired in-process technology
and research projects was based on the excess earnings
method on a project-by-project basis. This amount was
written-off upon acquisition as acquired in-process
research and development expense.  Pro forma financial results
   19




---



##### Table of Contents



Nine Months Ended
    
    
    Fiscal Year Ended(in thousands, except per share data)
    
    December 31, 2007
    
    
    March 31, 2007Total revenues
    
    $
    3,428,231
    
    
    $
    4,197,786Net loss before preferred dividend
    
    $
    (1,290,242
    )
    
    $
    (1,311,466
    )Preferred dividend
    
    
    (104,276
    )
    
    
    (121,656
    )Net loss available to common shareholders
    
    $
    (1,394,518
    )
    
    $
    (1,433,122
    )Loss per common shareBasic
    
    $
    (4.91
    )
    
    $
    (5.35
    )Diluted
    
    $
    (4.91
    )
    
    $
    (5.35
    )Weighted average sharesBasic
    
    
    283,900
    
    
    
    267,984Diluted
    
    
    283,900
    
    
    
    267,984
  Note 4. Impairment of Long-lived Assets Including Goodwill
 ®
 Accounting for the Impairment or Disposal of Long-Lived Assets
    Income Approach:
 20




---



##### Table of Contents



Market-Based Approach:
     Note 5. Revenue Recognition
 ®
   21




---



##### Table of Contents



Note 6. Restructuring
  Accounting for Costs Associated with Exit or Disposal Activities
 Note 7. Comparative Nine-Month Financial Information
  MYLAN INC. AND SUBSIDIARIES
 Consolidated Statements of Operations
 Nine Months Ended December 31,
    
    2007
    
    
    2006(in thousands, except per share amounts)
    
    
    
    
    
    (Unaudited)RevenuesNet revenues
    
    $
    2,162,943
    
    
    $
    1,103,247Other revenues
    
    
    15,818
    
    
    
    21,310Total revenues
    
    
    2,178,761
    
    
    
    1,124,557Cost of sales
    
    
    1,304,313
    
    
    
    515,736Gross profit
    
    
    874,448
    
    
    
    608,821Operating expenses:Research and development
    
    
    146,063
    
    
    
    66,844Acquired in-process research and development
    
    
    1,269,036
    
    
    
    Selling, general and administrative
    
    
    449,598
    
    
    
    152,784Litigation settlements, net
    
    
    (1,984
    )
    
    
    (46,154
    )Total operating expenses
    
    
    1,862,713
    
    
    
    173,474(Loss) earnings from operations
    
    
    (988,265
    )
    
    
    435,347Interest expense
    
    
    179,410
    
    
    
    31,292Other income, net
    
    
    86,611
    
    
    
    39,785(Loss) earnings before income taxes and minority interest
    
    
    (1,081,064
    )
    
    
    443,840Provision for income taxes
    
    
    60,073
    
    
    
    155,267(Loss) earnings before minority interest
    
    
    (1,141,137
    )
    
    
    288,573Minority interest income
    
    
    3,112
    
    
    
    Net (loss) earnings before preferred dividends
    
    
    (1,138,025
    )
    
    
    288,573Preferred dividend
    
    
    15,999
    
    
    
    Net (loss) earnings available to common shareholders
    
    
    (1,154,024
    )
    
    
    288,573(Loss) earnings per common share:Basic
    
    $
    (4.49
    )
    
    $
    1.37Diluted
    
    $
    (4.49
    )
    
    $
    1.34
 22




---



##### Table of Contents



Nine Months Ended December 31,
    
    2007
    
    
    2006(in thousands, except per share amounts)
    
    
    
    
    
    (Unaudited)Weighted average common shares outstanding:Basic
    
    
    257,150
    
    
    
    211,075Diluted
    
    
    257,150
    
    
    
    215,275
 Note 8. Balance Sheet Components
  December 31,
    
    
    December 31,(in thousands)
    
    2008
    
    
    2007Inventories:Raw materials
    
    $
    273,232
    
    
    $
    255,744Work in process
    
    
    157,473
    
    
    
    160,918Finished goods
    
    
    635,285
    
    
    
    647,178$
    1,065,990
    
    
    $
    1,063,840Property, plant and equipment:Land and improvements
    
    $
    56,945
    
    
    $
    62,824Buildings and improvements
    
    
    577,182
    
    
    
    583,097Machinery and equipment
    
    
    1,012,748
    
    
    
    980,340Construction in progress
    
    
    110,721
    
    
    
    125,6821,757,596
    
    
    
    1,751,943Less accumulated depreciation
    
    
    693,600
    
    
    
    649,011$
    1,063,996
    
    
    $
    1,102,932Other current liabilities:Payroll and employee benefit plan accruals
    
    $
    181,316
    
    
    $
    136,232Accrued rebates
    
    
    236,312
    
    
    
    301,829Fair value of financial instruments
    
    
    91,797
    
    
    
    Legal and professional accruals
    
    
    71,813
    
    
    
    58,883Other
    
    
    127,400
    
    
    
    148,186$
    708,638
    
    
    $
    645,130
 Note 9. Available-for-Sale Fixed Income Securities
  Gross
    
    
    GrossAmortized
    
    
    Unrealized
    
    
    Unrealized
    
    
    Fair(in thousands)
    
    Cost
    
    
    Gains
    
    
    Losses
    
    
    ValueDecember 31, 2008Debt securities
    
    $
    42,146
    
    
    $
    1,772
    
    
    $
    (2,260
    )
    
    $
    41,658Equity securities
    
    
    
    
    
    
    602
    
    
    
    
    
    
    
    602$
    42,146
    
    
    $
    2,374
    
    
    $
    (2,260
    )
    
    $
    42,260December 31, 2007Debt securities
    
    $
    88,806
    
    
    $
    1,748
    
    
    $
    (315
    )
    
    $
    90,239Equity securities
    
    
    
    
    
    
    1,122
    
    
    
    
    
    
    
    1,122$
    88,806
    
    
    $
    2,870
    
    
    $
    (315
    )
    
    $
    91,361
  (in thousands)Mature within one year
    
    $
    2,819Mature in one to five years
    
    
    14,115Mature in five years and later
    
    
    24,724$
    41,658
  23




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Note 10. Goodwill and Other Intangible Assets
  (in thousands)
    
    TotalGoodwill balance at December 31, 2007
    
    $
    3,855,971Impairment loss on goodwill
    
    
    (385,000
    )Foreign currency translation and other
    
    
    (309,391
    )Goodwill balance at December 31, 2008
    
    $
    3,161,580
 (in thousands)
    

    TotalGoodwill balance at March 31, 2007
    
    $
    612,742Acquisition of Merck Generics
    
    
    3,166,005Foreign currency translation and other
    
    
    77,224Goodwill balance at December 31, 2007
    
    $
    3,855,971
    WeightedAverage Life
    
    
    Original
    
    
    Accumulated
    
    
    Net Book(dollars in thousands)
    
    (Years)
    
    
    Cost
    
    
    Amortization
    
    
    ValueDecember 31, 2008Amortized intangible assets:Patents and technologies
    
    
    20
    
    
    $
    118,926
    
    
    $
    71,631
    
    
    $
    47,295Product rights and licenses
    
    
    10
    
    
    
    2,738,191
    
    
    
    433,169
    
    
    
    2,305,022Other
    
    
    8
    
    
    
    129,563
    
    
    
    28,719
    
    
    
    100,844$
    2,986,680
    
    
    $
    533,519
    
    
    $
    2,453,161December 31, 2007Amortized intangible assets:Patents and technologies
    
    
    20
    
    
    $
    118,926
    
    
    $
    65,578
    
    
    $
    53,348Product rights and licenses
    
    
    10
    
    
    
    2,961,712
    
    
    
    152,865
    
    
    
    2,808,847Other
    
    
    8
    
    
    
    129,031
    
    
    
    12,520
    
    
    
    116,511$
    3,209,669
    
    
    $
    230,963
    
    
    $
    2,978,706
  24




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##### Table of Contents



Note 11. Financial Instruments and Risk Management
 Foreign Currency Exchange Risk
     
    
    812.4 million ($1.13 billion) of borrowings under the Senior Credit Agreement that are
designated as a hedge of our net investment in certain Euro-functional currency
subsidiaries. The after-tax impact of revaluing these borrowings due to changes in spot
exchange rates is included in the foreign currency translation adjustment component of other
comprehensive (loss) earnings in the Consolidated Statements of Shareholders Equity.
    
    $489.6 million net notional value of foreign exchange forward contracts maturing within
one month that serve to offset changes in spot exchange rates of intercompany foreign
currency denominated assets or liabilities. The Company recognizes the earnings impact of
these contracts in other income, net in the Consolidated Statements of Operations during the
terms of the contracts, along with the earnings impact of the items they generally offset.
  
    
    875.4 million ($1.23 billion) of borrowings under the Senior Credit Agreement that are
designated as a hedge of our net investment in certain Euro-functional currency
subsidiaries. The after-tax impact of revaluing these borrowings due to changes in spot
exchange rates is included in the foreign currency translation adjustment component of other
comprehensive (loss) earnings in the Consolidated Statements of Shareholders Equity.
    
    $345.6 million net notional value of foreign exchange forward contracts maturing within
one month that serve to offset changes in spot exchange rates of intercompany foreign
currency denominated assets or liabilities. The Company recognizes the earnings impact of
these contracts in other income, net in the Consolidated Statements of Operations during the
terms of the contracts, along with the earnings impact of the items they generally offset.
  25




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##### Table of Contents



Interest Rate Risk
   
    
    $500.0 million of notional interest rate swaps that fix a rate of 5.44% until March 2010
    
    $500.0 million of notional interest rate swaps that fix a rate of 6.03% until December
2010
    
 Equity Risk
  Fair Value Measurement
 Fair Value Measurements
 Determining the Fair
Value of a Financial Asset when the Market for that Asset is not Active
  Level 1:
 26




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##### Table of Contents



Level 2:
 Level 3:
   Financial Assets
    
    Level 1
    
    
    Level 2
    
    
    Level 3
    
    
    Total(in thousands)Available-for-sale fixed income investments
    
    $
    
    
    
    $
    32,583
    
    
    $
    
    
    
    $
    32,583Available-for-sale equity securities
    
    
    602
    
    
    
    
    
    
    
    
    
    
    
    602Foreign exchange derivative assets
    
    
    
    
    
    
    14,632
    
    
    
    
    
    
    
    14,632Purchased cash convertible note hedge
    
    
    
    
    
    
    235,750
    
    
    
    
    
    
    
    235,750Auction rate securities(2)
    
    
    
    
    
    
    
    
    
    
    9,075
    
    
    
    9,075Total assets at fair value(1)
    
    $
    602
    
    
    $
    282,965
    
    
    $
    9,075
    
    
    $
    292,642
 Financial Liabilities
    
    Level 1
    
    
    Level 2
    
    
    Level 3
    
    
    Total(in thousands)Foreign exchange derivative liabilities
    
    $
    
    
    
    $
    19,402
    
    
    $
    
    
    
    $
    19,402Interest rate swap derivative liabilities
    
    
    
    
    
    
    72,395
    
    
    
    
    
    
    
    72,395Cash conversion feature of cash convertible notes
    
    
    
    
    
    
    235,750
    
    
    
    
    
    
    
    235,750Total liabilities at fair value(1)
    
    $
    
    
    
    $
    327,547
    
    
    $
    
    
    
    $
    327,547
 
 (1)
    
    The Company chose not to elect the fair value option as prescribed by SFAS No. 159 for its financial assets
and liabilities that had not been previously carried at fair value. Therefore, material financial assets
and liabilities such as short-term and long-term debt obligations and trade accounts receivable and
payable, are still reported at their carrying values.(2)
    
    There have been no changes to the fair value of these securities during the quarter ended December 31, 2008.   
    
    Municipal bonds valued at the quoted market price from broker or dealer quotations or
transparent pricing sources at the reporting date.
    
    Other available-for-sale fixed income investments valued at the quoted market price
from broker or dealer quotations or transparent pricing sources at the reporting date.
    
    Equity Securities valued using quoted stock prices from the London Exchange at the
reporting date and translated to U.S. dollars at prevailing spot exchange rates.
 27




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##### Table of Contents




    
    Interest rate swap derivative assets and liabilities valued using the LIBOR yield curve
at the reporting date. Counterparties to these contracts are highly rated financial
institutions, none of which experienced any significant downgrades during the calendar year
ended December 31, 2008, that would reduce the receivable amount owed, if any, to the
Company.
    
    Foreign exchange derivative assets and liabilities valued using quoted forward foreign
exchange prices at the reporting date. Counterparties to these contracts are highly rated
financial institutions, none of which experienced any significant downgrades during the
calendar year ended December 31, 2008, that would reduce the receivable amount owed, if any,
to the Company.
    
    Cash Conversion Feature of Cash Convertible Notes and Purchased Convertible Note Hedge
 valued using quoted prices for the Companys cash convertible notes, its implied
volatility and the quoted yield on the Companys other long-term debt at the reporting date.
Counterparties to the Purchased Convertible Note Hedge are highly rated financial
institutions, none of which experienced any significant downgrades during the calendar year
ended December 31, 2008, that would reduce the receivable amount owed, if any, to the
Company.
  Note 12. Long-Term Debt
  (in thousands)
    
    December 31, 2008
    
    
    December 31, 2007U.S. Tranche A Term Loans(A)
    
    $
    265,625
    
    
    $
    312,500Euro Tranche A Term Loans(A)
    
    
    413,684
    
    
    
    516,127U.S. Tranche B Term Loans(A)
    
    
    2,504,880
    
    
    
    2,556,000Euro Tranche B Term Loans(A)
    
    
    714,583
    
    
    
    773,273Revolving Facility(A)
    
    
    
    
    
    
    300,000Senior Convertible Notes(B)
    
    
    600,000
    
    
    
    600,000Cash Convertible Notes(C)
    
    
    655,442
    
    
    
    Other
    
    
    14,586
    
    
    
    54,194$
    5,168,800
    
    
    $
    5,112,094Less: Current portion
    
    
    3,381
    
    
    
    405,378Total long-term debt
    
    $
    5,165,419
    
    
    $
    4,706,716
 
 (A)
    
    On October 2, 2007, the Company entered into a credit
agreement (the Senior Credit Agreement) among the
Company, a wholly-owned European subsidiary (the Euro
Borrower), certain lenders and JPMorgan Chase Bank,
National Association, as Administrative Agent, pursuant to
which the Company borrowed $500.0 million in Tranche A Term
Loans (the U.S. Tranche A Term Loans) and $2.0 billion in
Tranche B Term Loans (the U.S. Tranche B Term Loans), and
the Euro Borrower borrowed approximately 1.13 billion
($1.6 billion) in Euro Term Loans (the Euro Term Loans
and, together with the U.S. Tranche A Term Loans and the
U.S. Tranche B Term Loans, the Term Loans). The proceeds
of the Term Loans were used (1) to pay a portion of the
consideration for the acquisition of the former Merck
Generics business, (2) to refinance the 2007 credit
facility and the 2006 credit facility, (together the
Existing Credit Agreements), by and among the Company,
the lenders party thereto and JPMorgan Chase Bank, National
Association, as administrative agent, (3) to purchase the
Senior Notes tendered pursuant to the cash tender offers
therefore and (4) to pay a portion of the fees and expenses
in respect of the foregoing transactions (collectively, the
Transactions). The termination of the Existing Credit
Agreements was concurrent with, and contingent upon, the
effectiveness of the Senior Credit Agreement. The Senior
Credit Agreement also contains a $750.0 million revolving
facility (the Revolving Facility and, together with the
Term Loans, the Senior Credit Facilities) under which
either the Company or the Euro Borrower may obtain
extensions of credit, subject to the satisfaction of
specified conditions. In conjunction with the closing of
the former Merck Generics business acquisition the Company
borrowed $300.0 million under the Revolving Facility. The
Revolving Facility includes a $100.0 million subfacility
for the issuance of letters of credit and a $50.0 million
subfacility for swingline borrowings. Borrowings under the
Revolving Facility are available in U.S. dollars, Euro,
Pounds Sterling, Yen or other currencies that may be
agreed. The Euro Term Loans are guaranteed by the Company
and the Senior Credit Facilities are guaranteed by
substantially all of the Companys domestic subsidiaries
(the Guarantors). The Senior Credit Facilities are also
secured by a pledge of the capital stock of substantially
all direct subsidiaries of the Company and the Guarantors
(limited to 65% of outstanding voting stock of foreign
holding companies and any foreign subsidiaries) and
substantially all of the other tangible and intangible
property and assets of the Company and the Guarantors. The
Revolving Facility expires in October 2013. 28




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The U.S. Tranche A Term Loans currently bear interest at
LIBOR (determined in accordance with the Senior Credit
Agreement) plus 3% per annum, if the Company chooses to
make LIBOR borrowings, or at a base rate (determined in
accordance with the Senior Credit Agreement) plus 2% per
annum. The U.S. Tranche B Term Loans currently bear
interest at LIBOR (determined in accordance with the Senior
Credit Agreement) plus 3.25% per annum, if the Company
chooses to make LIBOR borrowings, or at a base rate
(determined in accordance with the Senior Credit Agreement)
plus 2.25% per annum. The Euro Tranche A Term Loans
currently bear interest at the Euro Interbank Offered Rate
(EURIBO) determined in accordance with the Senior Credit
Agreement) plus 3% per annum. The Euro Tranche B Term Loans
currently bear interest at the EURIBO determined in
accordance with the Senior Credit Agreement) plus 3.25% per
annum. Borrowings under the Revolving Facility currently
bear interest at LIBOR (or EURIBO, in the case of
borrowings denominated in Euro) plus 2.50% per annum, if
the Company chooses to make LIBOR (or EURIBO, in the case
of borrowings denominated in Euro) borrowings, or at a base
rate plus 1.50% per annum. The applicable margins over
LIBOR, EURIBO or the base rate for the Revolving Facility
and the U.S. Tranche A Term Loans can fluctuate based on a
calculation of the Companys Consolidated Leverage Ratio as
defined in the Senior Credit Agreement. The Company also
pays a facility fee on the entire amount of the Revolving
Facility. The facility fee is currently 0.50% per annum,
but can decrease to 0.375% per annum based on the Companys
Consolidated Leverage Ratio.The Senior Credit Agreement contains customary affirmative
covenants for facilities of this type, including covenants
pertaining to the delivery of financial statements, notices
of default and certain other information, maintenance of
business and insurance, collateral matters and compliance
with laws, as well as customary negative covenants for
facilities of this type, including limitations on the
incurrence of indebtedness and liens, mergers and certain
other fundamental changes, investments and loans,
acquisitions, transactions with affiliates, dispositions of
assets, payments of dividends and other restricted
payments, prepayments or amendments to the terms of
specified indebtedness (including the Interim Credit
Agreement described below) and changes in lines of
business. The Senior Credit Agreement contains financial
covenants requiring maintenance of a minimum interest
coverage ratio and a senior leverage ratio, both of which
are defined within the agreement.The Senior Credit Agreement contains default provisions
customary for facilities of this type, which are subject to
customary grace periods and materiality thresholds,
including, among other things, defaults related to payment
failures, failure to comply with covenants,
misrepresentations, defaults or the occurrence of a change
of control under other material indebtedness, bankruptcy
and related events, material judgments, certain events
related to pension plans, specified changes in control of
the Company and invalidity of guarantee and security
agreements. If an event of default occurs under the Senior
Credit Agreement, the lenders may, among other things,
terminate their commitments, declare immediately payable
all borrowings and foreclose on the collateral.The U.S. Tranche A Term Loans and the Euro Tranche A Term
Loans mature on October 2, 2013. The U.S. Tranche B Term
Loans and the Euro Tranche B Term Loans mature on
October 2, 2014. The U.S. Tranche B Term Loans and the Euro
Term Loans amortize quarterly at the rate of 1.0% per annum
beginning in 2008. The Senior Credit Agreement requires
prepayments of the Term Loans with (1) up to 50% of Excess
Cash Flow, as defined within the Senior Credit Agreement,
beginning in 2009, with reductions based on the Companys
Consolidated Leverage Ratio, (2) the proceeds from certain
asset sales and casualty events, unless the Companys
Consolidated Leverage Ratio is equal to or less than 3.5 to
1.0, and (3) the proceeds from certain issuances of
indebtedness not permitted by the Senior Credit Agreement.
Amounts drawn on the Revolving Facility become due and
payable on October 2, 2013. The Term Loans and amounts
drawn on the Revolving Facility may be voluntarily prepaid
without penalty or premium.In addition, on October 2, 2007, the Company entered into a
credit agreement (the Interim Credit Agreement) among the
Company, certain lenders and Merrill Lynch Capital
Corporation, as Administrative Agent, pursuant to which the
Company borrowed $2.85 billion in term loans (the Interim
Term Loans). The proceeds of the Interim Term Loans were
used to finance in part the acquisition of the former Merck
Generics business. On November 19, 2007, the Interim Term
Loans were paid using primarily the proceeds received from
the preferred stock and common stock issuances of
$2.82 billion and the remaining $28.1 million was paid
using existing cash of the Company.On December 20, 2007, the Euro Borrower, certain lenders
and the Administrative Agent entered into an Amended and
Restated Credit Agreement (the Amended Senior Credit
Agreement), which became effective December 28, 2007,
that, among other things, amends certain provisions of the
Original Senior Credit Agreement as set out below.The Amended Senior Credit Agreement (i) reduced the
principal amount of the U.S. Tranche A Term Loans of the
Company to an aggregate principal amount of $312.5 million,
(ii) increased the principal amount of the U.S. Tranche B
Term Loans of the Company to an aggregate principal amount
of $2.56 billion, (iii) created a tranche of Euro Tranche A
Term Loans of the Euro Borrower in an aggregate principal
amount of 350.4 ($516.1) million and (iv) reduced the Euro
Tranche B Term Loans of the Euro Borrower to an aggregate
principal amount of 525.0 ($773.3) million.The Euro Tranche A Term Loans currently bear interest at
EURIBO (determined in accordance with the Amended Senior Credit 29




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##### Table of Contents



Agreement) plus 3.25% per annum. Under the terms of
the Amended Senior Credit Agreement, the applicable margin
over EURIBO for the Euro Tranche A Term Loans can fluctuate
based on the Companys Consolidated Leverage Ratio.The Amended Senior Credit Agreement added a prepayment
premium of 1.0% of the principal amount of the U.S.
Tranche B Term Loans or Euro Tranche B Term Loans prepaid
in connection with voluntary and certain mandatory
prepayments during the 12 months following the date of
effectiveness of the Amended Senior Credit Agreement.During the calendar year ended December 31, 2008, the
company paid $46.9 million on the U.S. Tranche A Term
Loans, which included $31.3 million of prepayments related
to 2009, 52.6 ($74.4) million on the Euro Tranche A Term
Loans, which included 35.0 ($49.6) million of prepayments
related to 2009, $51.1 million on the U.S. Tranche B Term
Loans, which included $25.6 million of prepayments related
to 2009, and 10.5 ($15.2) million on the Euro Tranche B
Term Loans, which included 5.3 ($7.4) million of
prepayments related to 2009. On September 15, 2008, the
outstanding borrowings under the Revolving Facility were
repaid in the amount of $300.0 million using proceeds from
the Cash Convertible Notes.At December 31, 2008 and December 31, 2007, the Company had
outstanding letters of credit of $83.6 million and
$51.3 million.(B)
    
    On March 1, 2007, Mylan entered into a purchase agreement
relating to the sale by the Company of $600.0 million
aggregate principal amount of the Companys 1.25% Senior
Convertible Notes due 2012 (the Senior Convertible
Notes). The Senior Convertible Notes bear interest at a
rate of 1.25% per year, accruing from March 7, 2007.
Interest is payable semiannually in arrears on March 15 and
September 15 of each year, beginning September 15, 2007.
The Senior Convertible Notes will mature on March 15, 2012,
subject to earlier repurchase or conversion. Holders may
convert their notes subject to certain conversion
provisions determined by, among others, the market price of
the Companys common stock and the trading price of the
Senior Convertible Notes. The Senior Convertible Notes have
an initial conversion rate of 44.5931 shares of common
stock per $1,000 principal amount (equivalent to an initial
conversion price of approximately $22.43 per share),
subject to adjustment, with the principal amount payable in
cash and the remainder in cash or stock at the option of
the Company. The accounting related to the Senior
Convertible Notes will change in accordance with the
adoption of FSP No. APB 14-1 (see Note 2).On March 1, 2007, concurrently with the sale of the Senior
Convertible Notes, Mylan entered into a convertible note
hedge transaction, comprised of a purchased call option,
and two warrant transactions with each of Merrill Lynch
International, an affiliate of Merrill Lynch, and JPMorgan
Chase Bank, National Association, London Branch, an
affiliate of JPMorgan, each of which the Company refers to
as a counterparty. The net cost of the transactions was
$80.6 million. The purchased call options will cover
approximately 26.8 million shares of Mylan common stock,
subject to anti-dilution adjustments substantially similar
to the anti-dilution adjustments for the Senior Convertible
Notes, which under most circumstances represents the
maximum number of shares that underlie the Senior
Convertible Notes. Concurrently with entering into the
purchased call options, the Company entered into warrant
transactions with the counterparties. Pursuant to the
warrant transactions, the Company will sell to the
counterparties warrants to purchase in the aggregate
approximately 26.8 million shares of Mylan common stock,
subject to customary anti-dilution adjustments. The
warrants may not be exercised prior to the maturity of the
Senior Convertible Notes, subject to certain limited
exceptions.The purchased call options are expected to reduce the
potential dilution upon conversion of the Senior
Convertible Notes in the event that the market value per
share of Mylan common stock at the time of exercise is
greater than approximately $22.43, which corresponds to the
initial conversion price of the Senior Convertible Notes.
The sold warrants have an exercise price that is 60.0%
higher than the price per share of $19.50 at which the
Company offered common stock in a concurrent equity
offering. If the market price per share of Mylan common
stock at the time of conversion of any Senior Convertible
Notes is above the strike price of the purchased call
options, the purchased call options will, in most cases,
entitle the Company to receive from the counterparties in
the aggregate the same number of shares of our common stock
as the Company would be required to issue to the holder of
the converted Senior Convertible Notes. Additionally, if
the market price of Mylan common stock at the time of
exercise of the sold warrants exceeds the strike price of
the sold warrants, the Company will owe the counterparties
an aggregate of approximately 26.8 million shares of Mylan
common stock. The purchased call options and sold warrants
may be settled for cash at the Companys election.The purchased call options and sold warrants are separate
transactions entered into by the Company with the
counterparties, are not part of the terms of the Senior
Convertible Notes, and will not affect the holders rights
under the Senior Convertible Notes. Holders of the Senior
Convertible Notes will not have any rights with respect to
the purchased call options or the sold warrants. The
purchased call options and sold warrants meet the
definition of derivatives under SFAS No. 133 (as amended by
SFAS No. 138, Accounting for Certain Derivative Instruments
and Certain Hedging Activitiesand SFAS No. 149, Amendment
of Statement 133 on Derivative Instruments and Hedging
Activities). However, because these instruments have been
determined to be indexed to the Companys own stock (in
accordance with the guidance of EITF Issue No. 01-6, The
Meaning of Indexed to a Companys Own Stock(EITF Issue
No. 01-6)) and have been recorded in stockholders equity
in the Companys Consolidated Balance Sheet (as determined
under EITF Issue No. 00-19, Accounting for Derivative
Financial Instruments Indexed to, and 30




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##### Table of Contents



Potentially Settled
in, a Companys Own Stock(EITF Issue No. 00-19)), the
instruments are exempted from the scope of SFAS No. 133 and
are not subject to the fair value provisions of that
standard.(C)
    
    On September 15, 2008, Mylan entered into a purchase
agreement relating to the sale by the Company of
$575.0 million aggregate principal amount of Cash
Convertible Notes due 2015 (Cash Convertible Notes). The
Cash Convertible Notes bear stated interest at a rate of
3.75% per year, accruing from September 15, 2008. The
effective interest rate at December 31, 2008 is 9.5%.
Interest is payable semi-annually in arrears on March 15
and September 15 of each year, beginning on March 15, 2009.
The Cash Convertible Notes will mature on September 15,
2015, subject to earlier repurchase or conversion. Holders
may convert their notes subject to certain conversion
provisions determined by the market price of the Companys
common stock, specified distributions to common
shareholders, a fundamental change, and certain time
periods specified in the purchase agreement. The Cash
Convertible Notes have an initial conversion reference rate
of 75.0751 shares of common stock per $1,000 principal
amount (equivalent to an initial conversion reference price
of $13.32 per share), subject to adjustment, with the
principal amount and remainder payable in cash. The Cash
Convertible Notes are not convertible into our common stock
or any other securities under any circumstance.On September 15, 2008, concurrent with the sale of the Cash
Convertible Notes, Mylan entered into a convertible note
hedge and warrant transaction with certain counterparties.
The net cost of the transactions was $98.6 million. The
cash convertible note hedge is comprised of purchased
cash-settled call options that are expected to reduce the
Companys exposure to potential cash payments required to
be made by Mylan upon the cash conversion of the Cash
Convertible Notes. Concurrent with entering into the
purchased cash-settled call options, the Company entered
into respective warrant transactions with the
counterparties pursuant to which the Company has sold to
each counterparty warrants for the purchase of shares of
our common stock. Pursuant to the warrant transactions, the
Company sold to the counterparties warrants to purchase in
the aggregate up to approximately 43.2 million shares of
Mylan common stock, subject to anti-dilution adjustments
substantially similar to the anti-dilution adjustments for
the Cash Convertible Notes, which under most circumstances
represents the maximum number of shares that underlie the
conversion reference rate for the Cash Convertible Notes.
The warrants may not be exercised prior to the maturity of
the Cash Convertible Notes.Pursuant to the call option transactions, if the market
price per share of the Companys common stock at the time
of cash conversion of any Cash Convertible Notes is above
the strike price of the purchased cash-settled call
options, such call options will, in most cases, entitle us
to receive from the counterparties in the aggregate the
same amount of cash as we would be required to issue to the
holder of the cash converted notes in excess of the
principal amount thereof. The sold warrants have an
exercise price of $20.00 (which represents an exercise
price of approximately 80% higher than the market price per
share of $11.10) and are net share settled, meaning that
Mylan will issue a number of shares per warrant
corresponding to the difference between our share price at
each warrant expiration date and the exercise price.The purchased call options and sold warrants are separate
contracts entered into by us with the counterparties, are
not part of the notes and do not affect the rights of
holders under the Cash Convertible Notes. Holders of the
Cash Convertible Notes will not have any rights with
respect to the purchased call options or the sold warrants.
The purchased cash-settled call options meet the definition
of derivatives under SFAS No. 133. As such, the instrument
is marked to market each period. In addition, the liability
associated with the cash conversion feature of the Cash
Convertible Notes is marked to market each period. At
December 31, 2008, the $655.4 million consists of
$419.7 million of debt ($575.0 million face amount, net of
$155.3 million discount) and a liability with a fair value
of $235.8 million related to the bifurcated conversion
feature. The purchased call options are assets recorded at
their fair value of $235.8 million within other assets in
the Consolidated Balance Sheets at December 31, 2008. The
warrants meet the definition of derivatives under
SFAS No. 133; however, because these instruments have been
determined to be indexed to the Companys own stock (in
accordance with the guidance of EITF Issue No. 01-6 and
have been recorded in shareholders equity in the Companys
Consolidated Balance Sheets (as determined under EITF Issue
No. 00-19), the instruments are exempt from the scope of
SFAS No. 133 and are not subject to the fair value
provisions of that standard. 31




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##### Table of Contents



December 31, 2008(in thousands, except interest rates)
    
    Outstanding
    
    
    Basis
    
    RateU.S. Tranche A Term Loans
    
    $
    265,625
    
    
    LIBOR + 3%
    
    
    6.50
    %Euro Tranche A Term Loans
    
    $
    413,684
    
    
    EURIBO + 3%
    
    
    7.86
    %U.S. Tranche B Term LoansSwapped to Fixed Rate  December 2010(1)
    
    $
    500,000
    
    
    Fixed
    
    
    6.03
    %Swapped to Fixed Rate  March 2010(1)(2)
    
    
    500,000
    
    
    Fixed
    
    
    5.44
    %Swapped to Fixed Rate  December 2010(1)
    
    
    1,000,000
    
    
    Fixed
    
    
    7.37
    %Floating Rate
    
    
    504,880
    
    
    LIBOR + 3.25%
    
    
    5.79
    %Total U.S. Tranche B Term Loans
    
    $
    2,504,880Euro Tranche B Term Loans
    
    $
    714,583
    
    
    EURIBO + 3.25%
    
    
    8.11
    %
 
 (1)
    
    Designated as a cash flow hedge of expected future
borrowings under the Senior Credit Agreement(2)
    
    This interest rate swap has been extended to March 2012 at
a rate of 5.38%, effective March 2010 December 31, 2007(in thousands, except interest rates)
    
    Outstanding
    
    
    Basis
    
    RateU.S. Tranche A Term Loans
    
    $
    312,500
    
    
    LIBOR + 3.25%
    
    
    8.31
    %Euro Tranche A Term Loans
    
    $
    516,127
    
    
    EURIBO + 3.25%
    
    
    7.75
    %U.S. Tranche B Term LoansSwapped to Fixed Rate  December 2010
    
    $
    1,000,000
    
    
    Fixed
    
    
    7.37
    %Floating Rate
    
    
    1,556,000
    
    
    LIBOR + 3.25%
    
    
    8.24
    %Total U.S. Tranche B Term Loans
    
    $
    2,556,000Euro Tranche B Term Loans
    
    $
    773,273
    
    
    EURIBO + 3.25%
    
    
    7.75
    %
      U.S.
    
    
    Euro
    
    
    U.S.
    
    
    Euro
    
    
    Senior
    
    
    CashTranche A
    
    
    Tranche A
    
    
    Tranche B
    
    
    Tranche B
    
    
    Convertible
    
    
    Convertible(in thousands)
    
    Term Loans
    
    
    Term Loans
    
    
    Term Loans
    
    
    Term Loans
    
    
    Notes
    
    
    Notes
    
    
    Total2009
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    2010
    
    
    46,875
    
    
    
    73,003
    
    
    
    25,560
    
    
    
    7,292
    
    
    
    
    
    
    
    
    
    
    
    152,7302011
    
    
    62,500
    
    
    
    97,338
    
    
    
    25,560
    
    
    
    7,292
    
    
    
    
    
    
    
    
    
    
    
    192,6902012
    
    
    78,125
    
    
    
    121,672
    
    
    
    25,560
    
    
    
    7,292
    
    
    
    600,000
    
    
    
    
    
    
    
    832,6492013
    
    
    78,125
    
    
    
    121,671
    
    
    
    25,560
    
    
    
    7,292
    
    
    
    
    
    
    
    
    
    
    
    232,6482014
    
    
    
    
    
    
    
    
    
    
    2,402,640
    
    
    
    685,415
    
    
    
    
    
    
    
    
    
    
    
    3,088,055Thereafter
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    655,442
    
    
    
    655,442Total
    
    $
    265,625
    
    
    $
    413,684
    
    
    $
    2,504,880
    
    
    $
    714,583
    
    
    $
    600,000
    
    
    $
    655,442
    
    
    $
    5,154,214
 32




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##### Table of Contents



Note 13. Income Taxes
  Calendar Year Ended
    
    
    Nine Months Ended
    
    
    Fiscal Year Ended(dollars in thousands)
    
    December 31, 2008
    
    
    December 31, 2007
    
    
    March 31, 2007Federal:Current
    
    $
    219,370
    
    
    $
    101,659
    
    
    $
    242,434Deferred
    
    
    (90,470
    )
    
    
    (29,343
    )
    
    
    (46,593
    )128,900
    
    
    
    72,316
    
    
    
    195,841State and Puerto Rico:Current
    
    
    28,226
    
    
    
    9,598
    
    
    
    16,746Deferred
    
    
    15,978
    
    
    
    1,903
    
    
    
    (3,740
    )44,204
    
    
    
    11,501
    
    
    
    13,006Foreign:Current
    
    
    79,187
    
    
    
    23,413
    
    
    
    174Deferred
    
    
    (114,868
    )
    
    
    (47,157
    )
    
    
    (1,004
    )(35,681
    )
    
    
    (23,744
    )
    
    
    (830
    )Income taxes
    
    $
    137,423
    
    
    $
    60,073
    
    
    $
    208,017Pre-tax (loss) earningsDomestic
    
    $
    (303,167
    )
    
    $
    (413,886
    )
    
    $
    586,298Foreign
    
    
    255,344
    
    
    
    (667,178
    )
    
    
    (160,786
    )Total
    
    $
    (47,823
    )
    
    $
    (1,081,064
    )
    
    $
    425,512Effective tax rate
    
    
    (287.4
    )%
    
    
    (5.6
    )%
    
    
    48.9
    %
  Calendar Year Ended
    
    
    Nine Months Ended
    
    
    Fiscal Year EndedDecember 31,
    
    
    December 31,
    
    
    March 31,(in thousands)
    
    2008
    
    
    2007
    
    
    2007Deferred tax assets:Employee benefits
    
    $
    48,868
    
    
    $
    40,038
    
    
    $
    16,501Legal matters
    
    
    65,988
    
    
    
    59,388
    
    
    
    5,048Accounts receivable allowances
    
    
    145,579
    
    
    
    152,123
    
    
    
    126,191Inventories
    
    
    23,916
    
    
    
    
    
    
    
    8,859Deferred revenue
    
    
    
    
    
    
    
    
    
    
    43,250Investments
    
    
    16,852
    
    
    
    4,321
    
    
    
    7,256Other reserves
    
    
    26,158
    
    
    
    6,767
    
    
    
    Tax credits
    
    
    4,200
    
    
    
    3,575
    
    
    
    3,112Net operating losses
    
    
    134,779
    
    
    
    99,289
    
    
    
    17,111Convertible debt
    
    
    42,733
    
    
    
    40,514
    
    
    
    44,100Other
    
    
    82,428
    
    
    
    20,885
    
    
    
    3,801591,501
    
    
    
    426,900
    
    
    
    275,229Less: Valuation allowance
    
    
    (110,194
    )
    
    
    (76,100
    )
    
    
    (18,355
    )Total deferred tax assets
    
    
    481,307
    
    
    
    350,800
    
    
    
    256,874Deferred tax liabilities:Inventory
    
    
    2,818
    
    
    
    16,897
    
    
    
    Plant and equipment
    
    
    77,056
    
    
    
    67,425
    
    
    
    40,698Intangible assets
    
    
    663,987
    
    
    
    947,009
    
    
    
    98,285Investments
    
    
    2,541
    
    
    
    9,813
    
    
    
    10,779Other
    
    
    66,190
    
    
    
    
    
    
    
    1,890Total deferred tax liabilities
    
    
    812,592
    
    
    
    1,041,144
    
    
    
    151,652Deferred tax (liabilities) assets, net
    
    $
    (331,285
    )
    
    $
    (690,344
    )
    
    $
    105,222Classification in the Consolidated Balance Sheets:Deferred income tax benefit  current
    
    $
    199,278
    
    
    $
    192,113
    
    
    $
    145,343Deferred income tax liability  current
    
    
    (1,935
    )
    
    
    (24,344
    )
    
    
    Deferred income tax benefit  noncurrent
    
    
    16,493
    
    
    
    18,703
    
    
    
    45,779Deferred income tax liability  noncurrent
    
    
    (545,121
    )
    
    
    (876,816
    )
    
    
    (85,900
    )Deferred tax (liability) asset, net
    
    $
    (331,285
    )
    
    $
    (690,344
    )
    
    $
    105,222
 33




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##### Table of Contents



Calendar Year Ended
    
    Nine Months Ended
    
    Fiscal Year EndedDecember 31, 2008
    
    December 31, 2007
    
    March 31, 2007Statutory tax rate
    
    
    35.0
    %
    
    
    35.0
    %
    
    
    35.0
    %State and Puerto Rico income taxes and credits
    
    
    (41.0
    )%
    
    
    (0.6
    )%
    
    
    2.8
    %Research and Development tax credits
    
    
    4.9
    %
    
    
    0.3
    %
    
    
    (0.3
    )%Acquired In-Process R & D
    
    
    0.0
    %
    
    
    (41.1
    )%
    
    
    12.1
    %Effect of foreign operations
    
    
    9.5
    %
    
    
    1.8
    %
    
    
    0.0
    %Impairment of goodwill
    
    
    (281.8
    )%
    
    
    0.0
    %
    
    
    0.0
    %Other items
    
    
    (14.0
    )%
    
    
    (1.0
    )%
    
    
    (0.7
    )%Effective tax rate
    
    
    (287.4
    )%
    
    
    (5.6
    )%
    
    
    48.9
    %
 Valuation Allowance
  Net Operating Losses
  Acquired In-Process Research and Development
 Accounting for Deferred Taxes on
In-Process Research and Development Activities Acquired in a Purchase Business Combination
  Undistributed Earnings
  Federal Tax Credits and Ongoing IRS Examinations
   34




---



##### Table of Contents



FIN 48
      Unrecognized Tax(in thousands)
    
    BenefitsBalance at December 31, 2007
    
    $
    77,600Additions for current year tax positions
    
    
    49,169Additions for prior year tax positions
    
    
    538Reductions for prior year tax positions
    
    
    (3,313
    )Settlements
    
    
    Reductions related to expirations of statute of limitations
    
    
    (4,819
    )Addition due to cumulative adjustment
    
    
    47,338Balance at December 31, 2008
    
    $
    166,513
 Unrecognized Tax(in thousands)
    
    BenefitsBalance at March 31, 2007
    
    $
    42,900Additions for current year tax positions
    
    
    5,700Additions for prior year tax positions
    
    
    4,400Reductions for prior year tax positions
    
    
    (3,300
    )Settlements
    
    
    (10,500
    )Reductions related to expirations of statute of limitations
    
    
    (1,200
    )Addition due to cumulative adjustment
    
    
    39,600Balance at December 31, 2007
    
    $
    77,600
  35




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##### Table of Contents



Note 14. Preferred and Common Stock
     Note 15. Stock-Based Incentive Plan
 2003 Long-Term Incentive Plan
 1997 Incentive Stock Option Plan
 36




---



##### Table of Contents



Weighted AverageNumber of Shares
    
    Exercise PriceUnder Option
    
    per ShareOutstanding at March 31, 2006
    
    
    21,358,670
    
    
    $
    15.16Options granted
    
    
    1,139,400
    
    
    
    21.65Options exercised
    
    
    (4,053,061
    )
    
    
    12.18Options forfeited
    
    
    (797,281
    )
    
    
    17.28Outstanding at March 31, 2007
    
    
    17,647,728
    
    
    
    16.17Options granted
    
    
    4,303,792
    
    
    
    15.91Options exercised
    
    
    (459,836
    )
    
    
    13.18Options forfeited
    
    
    (661,148
    )
    
    
    17.51Outstanding at December 31, 2007
    
    
    20,830,536
    
    
    
    16.15Options granted
    
    
    4,180,133
    
    
    
    11.46Options exercised
    
    
    (107,707
    )
    
    
    10.20Options forfeited
    
    
    (1,479,921
    )
    
    
    16.64Outstanding at December 31, 2008
    
    
    23,423,041
    
    
    $
    15.32Vested and expected to vest at December 31, 2008
    
    
    22,852,133
    
    
    $
    15.35Options exercisable at December 31, 2008
    
    
    15,048,569
    
    
    $
    15.86
   Weighted AverageRestricted
    
    Number of Restricted
    
    Grant-DateStock Awards
    
    Stock Awards
    
    Fair ValueNonvested at December 31, 2007
    
    
    1,295,347
    
    
    $
    16.95Granted
    
    
    1,699,856
    
    
    
    11.30Released
    
    
    (367,939
    )
    
    
    15.57Forfeited
    
    
    (83,916
    )
    
    
    14.22Nonvested at December 31, 2008
    
    
    2,543,348
    
    
    $
    13.46
    37




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##### Table of Contents



Calendar Year Ended
    
    Nine Months Ended
    
    Fiscal Year EndedDecember 31, 2008
    
    December 31, 2007
    
    March 31, 2007Volatility
    
    
    31.0
    %
    
    
    30.8
    %
    
    
    34.0
    %Risk-free interest rate
    
    
    2.2
    %
    
    
    4.6
    %
    
    
    4.8
    %Dividend yield
    
    
    0.0
    %
    
    
    0.0
    %
    
    
    1.1
    %Expected term of options (in years)
    
    
    4.5
    
    
    
    5.0
    
    
    
    4.5Forfeiture rate
    
    
    5.5
    %
    
    
    3.0
    %
    
    
    3.0
    %Weighted average grant date fair value per option
    
    $
    3.37
    
    
    $
    5.60
    
    
    $
    6.90
  Note 16. Employee Benefits
 Defined Benefit Plans
   Employers Accounting for Defined
Benefit Pension and Other Postretirement Plans, an amendment of FASB Statements No. 87, 88, 106,
and 132(R)
 Defined Contribution Plans
   38




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##### Table of Contents



Other Benefit Arrangements
   Note 17. Segment Information
     Calendar Year EndedDecember 31, 2008
    

    Generics Segment
    
    
    Specialty Segment
    
    
    Matrix Segment
    
    
    Corporate/Other(1)
    
    
    Consolidated(in thousands)Total revenuesThird party
    
    $
    3,907,518
    
    
    $
    385,963
    
    
    $
    376,007
    
    
    $
    468,097
    
    
    $
    5,137,585Intersegment
    
    
    1,798
    
    
    
    31,278
    
    
    
    68,813
    
    
    
    (101,889
    )
    
    
    Total
    
    
    3,909,316
    
    
    
    417,241
    
    
    
    444,820
    
    
    
    366,208
    
    
    $
    5,137,585Segment profitability
    
    $
    969,929
    
    
    $
    36,649
    
    
    $
    25,033
    
    
    $
    (733,726
    )
    
    $
    297,885
 Nine Months EndedDecember 31, 2007
    
    Generics Segment
    
    
    Specialty Segment
    
    
    Matrix Segment
    
    
    Corporate/Other(1)
    
    
    ConsolidatedTotal revenuesThird party
    
    $
    1,812,404
    
    
    $
    102,126
    
    
    $
    264,231
    
    
    $
    
    
    
    $
    2,178,761Intersegment
    
    
    563
    
    
    
    3,401
    
    
    
    29,547
    
    
    
    (33,511
    )
    
    
    Total
    
    
    1,812,967
    
    
    
    105,527
    
    
    
    293,778
    
    
    
    (33,511
    )
    
    $
    2,178,761Segment profitability
    
    $
    590,363
    
    
    $
    18,880
    
    
    $
    18,120
    
    
    $
    (1,615,628
    )
    
    $
    (988,265
    )
 Fiscal Year EndedMarch 31, 2007
    
    Generics Segment
    
    
    Specialty Segment
    
    
    Matrix Segment
    
    
    Corporate/Other(1)
    
    
    ConsolidatedTotal revenuesThird party
    
    $
    1,532,407
    
    
    $
    
    
    
    $
    79,412
    
    
    $
    
    
    
    $
    1,611,819Intersegment
    
    
    
    
    
    
    
    
    
    
    16,389
    
    
    
    (16,389
    )
    
    
    Total
    
    
    1,532,407
    
    
    
    
    
    
    
    95,801
    
    
    
    (16,389
    )
    
    $
    1,611,819Segment profitability
    
    $
    712,685
    
    
    $
    
    
    
    $
    8,578
    
    
    $
    (293,709
    )
    
    $
    427,554
 39




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##### Table of Contents



(1)
    
    Includes corporate general and administrative expenses,
litigation settlements, intercompany eliminations, revenue
related to the sale of Bystolic product rights,
amortization of intangible assets and certain purchase
accounting items (such as the write-off of in-process
research and development and the amortization of the
inventory step-up), non-cash impairment charges, and other
expenses not directly attributable to segments.  Calendar Year Ended
    
    
    Nine Months Ended
    
    
    Fiscal Year Ended(in thousands)
    
    December 31, 2008
    
    
    December 31, 2007
    
    
    March 31, 2007Allergy
    
    $
    219,308
    
    
    $
    28,301
    
    
    $
    Anti-infective Agents
    
    
    455,513
    
    
    
    166,383
    
    
    
    60,768Cardiovascular
    
    
    889,523
    
    
    
    587,020
    
    
    
    463,610Central Nervous System
    
    
    1,235,340
    
    
    
    584,466
    
    
    
    579,814Dermatology
    
    
    72,944
    
    
    
    44,718
    
    
    
    58,066Endocrine and Metabolic
    
    
    408,384
    
    
    
    198,875
    
    
    
    133,967Gastrointestinal
    
    
    357,489
    
    
    
    149,804
    
    
    
    59,655Renal and Genitourinary
    
    
    209,374
    
    
    
    122,484
    
    
    
    148,494Respiratory Agents
    
    
    310,993
    
    
    
    71,167
    
    
    
    7,810Other(1)
    
    
    472,369
    
    
    
    209,725
    
    
    
    74,763$
    4,631,237
    
    
    $
    2,162,943
    
    
    $
    1,586,947
 
 (1)
    
    Other consists of numerous therapeutic classes, none of
which individually exceeds 5% of consolidated net revenues. Geographic Information
  Calendar Year Ended
    
    
    Nine Months Ended
    
    
    Fiscal Year Ended(in thousands)
    
    December 31, 2008
    
    
    December 31, 2007
    
    
    March 31, 2007Net third-party revenuesThe AmericasUnited States
    
    $
    2,075,308
    
    
    $
    1,342,564
    
    
    $
    1,506,419Other Americas
    
    
    163,512
    
    
    
    68,117
    
    
    
    2,622Europe(1)
    
    
    1,755,807
    
    
    
    508,549
    
    
    
    50,958Asia
    
    
    636,610
    
    
    
    243,713
    
    
    
    26,948$
    4,631,237
    
    
    $
    2,162,943
    
    
    $
    1,586,947
 
 (1)
    
    Sales in France consisted of 16% of consolidated net
revenues for the calendar year ended December 31, 2008. Note 18. Commitments
  40




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##### Table of Contents



OperatingDecember 31,
    
    Leases(in thousands)2009
    
    $
    30,0812010
    
    
    24,1782011
    
    
    19,2302012
    
    
    12,8142013
    
    
    10,128Thereafter
    
    
    57,905$
    154,336
    Note 19. Contingencies
 Legal Proceedings
  Omeprazole
  41




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##### Table of Contents



Lorazepam and Clorazepate
  Pricing and Medicaid Litigation
    42




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##### Table of Contents



Modafinil Antitrust Litigation and FTC Inquiry
  Levetiracetam
  43




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##### Table of Contents



Digitek ®
 ®
 Pioglitazone
  Litigation related to the former Merck Generics Business
  Other Litigation
  44




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##### Table of Contents



Managements Report on Internal Control over Financial Reporting
  Internal Control  Integrated
Framework
  45




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##### Table of Contents



Report of Independent Registered Public Accounting Firm
     Accounting for Uncertainty in Income Taxes  an
Interpretation of FASB Statement No. 109
  Internal Control  Integrated Framework
 
 46




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##### Table of Contents



Report of Independent Registered Public Accounting Firm
 
 Internal Control 
Integrated Framework
    Internal
Control  Integrated Framework
  
 47




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##### Table of Contents



Mylan Inc.
 
 Supplementary Financial Information
 Quarterly Financial Data
 Calendar Year Ended December 31, 2008
 Three-Month Period EndedMarch 31,
    
    June 30,
    
    September 30,
    
    December 31,2008(3)
    
    2008
    
    2008(4)
    
    2008Total revenues
    
    $
    1,074,461
    
    
    $
    1,203,122
    
    
    $
    1,656,848
    
    
    $
    1,203,154Gross profit
    
    
    350,221
    
    
    
    414,210
    
    
    
    911,137
    
    
    
    394,653Net (loss) earnings available to common shareholders
    
    
    (443,893
    )
    
    
    (8,366
    )
    
    
    171,999
    
    
    
    (39,990
    )(Loss) earnings per share(1):Basic
    
    $
    (1.46
    )
    
    $
    (0.03
    )
    
    $
    0.56
    
    
    $
    (0.13
    )Diluted
    
    $
    (1.46
    )
    
    $
    (0.03
    )
    
    $
    0.45
    
    
    $
    (0.13
    )Share prices(2):High
    
    $
    15.40
    
    
    $
    13.35
    
    
    $
    14.02
    
    
    $
    11.28Low
    
    $
    10.33
    
    
    $
    11.40
    
    
    $
    10.85
    
    
    $
    5.77
 Nine Months Ended December 31, 2007
 Three-Month Period EndedJune 30,
    
    September 30,
    
    December 31,2007
    
    2007
    
    2007(5)Total revenues
    
    $
    546,321
    
    
    $
    477,091
    
    
    $
    1,155,349Gross profit
    
    
    296,708
    
    
    
    221,641
    
    
    
    356,099Net (loss) earnings available to common shareholders
    
    
    79,727
    
    
    
    149,827
    
    
    
    (1,383,577
    )(Loss) earnings per share(1):Basic
    
    $
    0.32
    
    
    $
    0.60
    
    
    $
    (5.04
    )Diluted
    
    $
    0.32
    
    
    $
    0.60
    
    
    $
    (5.04
    )Share prices(2):High
    
    $
    22.64
    
    
    $
    18.19
    
    
    $
    16.87Low
    
    $
    18.19
    
    
    $
    14.00
    
    
    $
    13.25
 
 (1)
    
    The sum of earnings per share for the quarters may not equal earnings per share for the total year due to changes
in the average number of common shares outstanding and the effect of the if-converted method related to our
outstanding mandatorily redeemable preferred stock.(2)
    
    Closing prices for all dates prior to December 29, 2008 are as reported on the New York Stock Exchange. Closing
prices for December 31, 2008 are as reported on The NASDAQ Stock Market.(3)
    
    The results for the three months ended March 31, 2008, include a $385.0 million non-cash goodwill impairment charge.(4)
    
    The results for the three months ended September 30, 2008, include $455.0 million of revenue and gross profit
related to the sale of the Bystolic product rights.(5)
    
    The results for the three months ended December 31, 2007, include the results of the former Merck Generics business
since its acquisition on October 2, 2007, and certain purchase accounting adjustments, including $1.27 billion
related to acquired in-process research and development. 48




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##### Table of Contents



ITEM 15. Exhibits, Financial Statement Schedules
 Consolidated Financial Statements
  Financial Statement Schedules
 MYLAN INC. AND SUBSIDIARIES
SCHEDULE II  VALUATION AND QUALIFYING ACCOUNTS
(in thousands)
 Additions
    
    Additions(Deductions)
    
    (Deductions)Charged to
    
    Charged toBeginning
    
    Costs and
    
    Other
    
    
    
    
    
    EndingDescription
    
    Balance
    
    Expenses
    
    Accounts
    
    Deductions
    
    BalanceAllowance for doubtful accounts:Calendar year ended December 31, 2008
    
    $
    38,088
    
    
    $
    (2,355
    )
    
    $
    (2,502
    )
    
    $
    (6,338
    )
    
    $
    26,893Nine months ended December 31, 2007
    
    $
    15,149
    
    
    $
    9,959
    
    
    $
    13,255
    *
    
    $
    (275
    )
    
    $
    38,088Fiscal year ended March 31, 2007
    
    $
    10,954
    
    
    $
    (500
    )
    
    $
    4,778
    **
    
    $
    (83
    )
    
    $
    15,149Valuation allowance for deferred tax assets:Calendar year ended December 31, 2008
    
    $
    76,100
    
    
    $
    53,421
    
    
    $
    (16,285
    )
    
    $
    (3,042
    )
    
    $
    110,194Nine months ended December 31, 2007
    
    $
    18,355
    
    
    $
    33,545
    
    
    $
    24,200
    *
    
    $
    
    
    
    $
    76,100Fiscal year ended March 31, 2007
    
    $
    1,644
    
    
    $
    5,531
    
    
    $
    11,180
    **
    
    $
    
    
    
    $
    18,355
 
 *
    
    Allowance recorded as part of the former Merck Generics business
acquisition.**
    
    Allowance recorded as part of the Matrix acquisition. Exhibits
 3.1(a)
    
    Amended and Restated Articles of Incorporation of the registrant, filed as Exhibit 3.1 to the
Form 10-Q for the quarterly period ended June 30, 2003, and incorporated herein by reference.3.1(b)
    
    Amendment to Amended and Restated Articles of Incorporation of the registrant, filed as Exhibit
3.2 to the Report on Form 8-K filed with the SEC on October 5, 2007, and incorporated herein by
reference.3.1(c)
    
    Amendment to Amended and Restated Articles of Incorporation of the registrant, filed as Exhibit
3.1 to the Report on Form 8-K filed with the SEC on November 20, 2007, and incorporated herein by
reference.3.2
    
    Bylaws of the registrant, as amended to date, filed as Exhibit 3.1 to the Report of Form 8-K
filed on December 21, 2007, and incorporated herein by reference.4.1(a)
    
    Rights Agreement dated as of August 22, 1996, between the registrant and American Stock Transfer
& Trust Company, filed as Exhibit 4.1 to the Report on Form 8-K filed with the SEC on September
3, 1996, and incorporated herein by reference.4.1(b)
    
    Amendment to Rights Agreement dated as of November 8, 1999, between the registrant and American
Stock Transfer & Trust Company, filed as Exhibit 1 to Form 8-A/A filed with the SEC on March 31,
2000, and incorporated herein by reference.4.1(c)
    
    Amendment No. 2 to Rights Agreement dated as of August 13, 2004, between the registrant and
American Stock Transfer & Trust Company, filed as Exhibit 4.1 to the Report on Form 8-K filed
with the SEC on August 16, 2004, and incorporated herein by reference.4.1(d)
    
    Amendment No. 3 to Rights Agreement dated as of September 8, 2004, between the registrant and
American Stock Transfer & Trust Company, filed as Exhibit 4.1 to the Report on Form 8-K filed
with the SEC on September 9, 2004, and incorporated herein by reference.
 49




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##### Table of Contents



4.1(e)
    
    Amendment No. 4 to Rights Agreement dated as of December 2, 2004, between the registrant and
American Stock Transfer & Trust Company, filed as Exhibit 4.1 to the Report on Form 8-K filed
with the SEC on December 3, 2004, and incorporated herein by reference.4.1(f)
    
    Amendment No. 5 to Rights Agreement dated as of December 19, 2005, between the registrant and
American Stock Transfer & Trust Company, filed as Exhibit 4.1 to the Report on Form 8-K filed
with the SEC on December 19, 2005, and incorporated herein by reference.4.2(a)
    
    Indenture, dated as of July 21, 2005, between the registrant and The Bank of New York, as
trustee, filed as Exhibit 4.1 to the Report on Form 8-K filed with the SEC on July 27, 2005, and
incorporated herein by reference.4.2(b)
    
    Second Supplemental Indenture, dated as of October 1, 2007, among the registrant, the
Subsidiaries of the registrant listed on the signature page thereto and The Bank of New York, as
trustee, filed as Exhibit 4.1 to the Report on Form 8-K filed with the SEC on October 5, 2007,
and incorporated herein by reference.4.3
    
    Registration Rights Agreement, dated as of July 21, 2005, among the registrant, the Guarantors
party thereto and Merrill Lynch, Pierce, Fenner & Smith Incorporated, BNY Capital Markets, Inc.,
KeyBanc Capital Markets (a Division of McDonald Investments Inc.), PNC Capital Markets, Inc. and
SunTrust Capital Markets, Inc., filed as Exhibit 4.2 to the Report on Form 8-K filed with the SEC
on July 27, 2005, and incorporated herein by reference.4.4
    
    Indenture, dated as of September 15, 2008, among the registrant, the guarantors named therein and
Bank of New York Mellon as trustee, filed as Exhibit 4.1 to the Report on Form 8-K filed with the
SEC on September 15, 2008, and incorporated herein by reference.10.1
    
    1986 Incentive Stock Option Plan, as amended to date, filed as Exhibit 10(b) to Form 10-K for the
fiscal year ended March 31, 1993, and incorporated herein by reference.*10.2
    
    1997 Incentive Stock Option Plan, as amended to date, filed as Exhibit 10.3 to Form 10-Q for the
quarter ended September 30, 2002, and incorporated herein by reference.*10.3
    
    1992 Nonemployee Director Stock Option Plan, as amended to date, filed as Exhibit 10(l) to Form
10-K for the fiscal year ended March 31, 1998, and incorporated herein by reference.*10.4(a)
    
    Amended and Restated 2003 Long-Term Incentive Plan, filed as Appendix A to Definitive Proxy
Statement on Schedule 14A, filed with the SEC on March 28, 2008, and incorporated herein by
reference.*10.4(b)
    
    Form of Stock Option Agreement under the 2003 Long-Term Incentive Plan, filed as Exhibit 10.4(b)
to Form 10-K for the fiscal year ended March 31, 2005, and incorporated herein by reference.*10.4(c)
    
    Form of Restricted Share Award under the 2003 Long-Term Incentive Plan, filed as Exhibit 10.4(c)
to Form 10-K for the fiscal year ended March 31, 2005, and incorporated herein by reference.*10.4(d)
    
    Amendment No. 1 to the Amended and Restated 2003 Long-Term Incentive Plan, dated as of December
17, 2008, filed as Exhibit 10.4(d)
to Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.*10.5
    
    Mylan Inc. Severance Plan, amended as of December 17, 2008, filed as Exhibit 10.5
to Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.*10.6
    
    3.75% Cash Convertible Notes due 2015 Purchase Agreement dated September 9, 2008, among the
registrant and the initial purchaser named therein, filed as Exhibit 1.1 to the Report on Form
8-K filed with the SEC on September 15, 2008, and incorporated herein by reference.10.7(a)
    
    Confirmation of OTC Convertible Note Hedge Transaction dated September 9, 2008, among the
registrant, Merrill Lynch International and Merrill Lynch, Pierce, Fenner & Smith Incorporated,
filed as Exhibit 10.1 to the Report on Form 8-K filed with the SEC on September 15, 2008, and
incorporated herein by reference.10.7(b)
    
    Confirmation of OTC Convertible Note Hedge Transaction, amended as of November 25, 2008, among
the registrant, Merrill Lynch International and Merrill Lynch, Pierce, Fenner & Smith
Incorporated, filed as Exhibit 10.7(b)
to Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.10.8
    
    Confirmation of OTC Convertible Note Hedge Transaction dated September 9, 2008, between the
registrant and Wells Fargo Bank, National Association, filed as Exhibit 10.2 to the Report on
Form 8-K filed with the SEC on September 15, 2008, and incorporated herein by reference.10.9
    
    Confirmation of OTC Warrant Transaction dated September 9, 2008, among the registrant, Merrill
Lynch International and Merrill Lynch, Pierce, Fenner & Smith Incorporated, filed as Exhibit 10.3
to the Report on Form 8-K filed with the SEC on September 15, 2008, and incorporated herein by
reference.10.10
    
    Confirmation of OTC Warrant Transaction dated September 9, 2008, between the registrant and Wells
Fargo Bank, National Association, filed as Exhibit 10.4 to the Report on Form 8-K filed with the
SEC on September 15, 2008, and incorporated herein by reference.
 50




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##### Table of Contents



10.11
    
    Amendment to Confirmation of OTC Warrant Transaction dated September 15, 2008 among the
registrant, Merrill Lynch International and Merrill Lynch, Pierce, Fenner & Smith Incorporated,
filed as Exhibit 10.5 to the Report on Form 8-K filed with the SEC on September 15, 2008, and
incorporated herein by reference.10.12
    
    Amendment to Confirmation of OTC Warrant Transaction dated September 15, 2008, between the
registrant and Wells Fargo Bank, National Association, filed as Exhibit 10.6 to the Report on
Form 8-K filed with the SEC on September 15, 2008, and incorporated herein by reference.10.13
    
    Amendment to Confirmation of OTC Warrant Transaction dated as of September 9, 2008 among Mylan
Inc., Merrill Lynch International and Merrill Lynch, Pierce, Fenner & Smith Incorporated, filed
as Exhibit 10.7 to the Report on Form 8-K filed with the SEC on September 15, 2008, and
incorporated herein by reference.10.14
    
    Amendment to Confirmation of OTC Warrant Transaction dated as of September 9, 2008 among Mylan
Inc., Merrill Lynch International and Merrill Lynch, Pierce, Fenner & Smith Incorporated, filed
as Exhibit 10.8 to the Report on Form 8-K filed with the SEC on September 15, 2008, and
incorporated herein by reference.10.15
    
    Calculation Agent Agreement dated September 9, 2008, among the registrant, Wells Fargo Bank,
National Association and Goldman Sachs International, filed as Exhibit 10.9 to the Report on Form
8-K filed with the SEC on September 15, 2008, and incorporated herein by reference.10.16(a)
    
    Amended and Restated Executive Employment Agreement dated as of April 3, 2006, between the
registrant and Robert J. Coury filed as Exhibit 10.5 to Form 10-K for the fiscal year ended March
31, 2006, and incorporated herein by reference.*10.16(b)
    
    Amendment No. 1 to Amended and Restated Executive Employment Agreement, dated as of December 22,
2008, between the registrant and Robert J. Coury, filed as Exhibit 10.16(b)
to Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.*10.17(a)
    
    Executive Employment Agreement dated as of July 1, 2004, between the registrant and Edward J.
Borkowski, filed as Exhibit 10.27 to Form 10-Q/A for the quarter ended September 30, 2004, and
incorporated herein by reference.*10.17(b)
    
    Amendment No. 1 to Executive Employment Agreement dated as of April 3, 2006, between the
registrant and Edward J. Borkowski filed as Exhibit 10.6(b) to Form 10-K for the fiscal year
ended March 31, 2006, and incorporated herein by reference.*10.17(c)
    
    Amendment No. 2 to Executive Employment Agreement dated as of March 12, 2008, by and between
registrant and Edward J. Borkowski filed as Exhibit 99.1 to the Report on Form 8-K filed with the
SEC on March 12, 2008, and incorporated herein by reference.*10.17(d)
    
    Amendment No. 3 to Executive Employment Agreement dated as of December 22, 2008, by and between
registrant and Edward J. Borkowski, filed as Exhibit 10.17(d)
to Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.*10.18(a)
    
    Executive Employment Agreement, dated as of January 31, 2007, between the registrant and Heather
Bresch filed as Exhibit 10.3 to Form 10-Q for the quarter ended March 31, 2008, and incorporated
herein by reference.*10.18(b)
    
    Amendment No. 1 to Executive Employment Agreement dated as of October 2, 2007, by and between the
registrant and Heather Bresch filed as Exhibit 10.4 to Form 10-Q for the quarter ended March 31,
2008, and incorporated herein by reference.*10.18(c)
    
    Amendment No. 2 to Executive Employment Agreement dated as of December 22, 2008, by and between
the registrant and Heather Bresch, filed as Exhibit 10.18(c)
to Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.*10.19(a)
    
    Executive Employment Agreement, dated as of January 31, 2007, between the registrant and Rajiv
Malik filed as Exhibit 10.6 to Form 10-Q for the quarter ended March 31, 2008, and incorporated
herein by reference.*10.19(b)
    
    Amendment No. 1 to Executive Employment Agreement dated as of October 2, 2007, by and between the
registrant and Rajiv Malik filed as Exhibit 10.7 to Form 10-Q for the quarter ended March 31,
2008, and incorporated herein by reference.*10.19(c)
    
    Amendment No. 2 to Executive Employment Agreement dated as of December 22, 2008, by and between
the registrant and Rajiv Malik, filed as Exhibit 10.19(c)
to Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.*10.20(a)
    
    Retirement Benefit Agreement dated as of December 31, 2004, between the registrant and Robert J.
Coury filed as Exhibit 10.7 to Form 10-Q for the quarter ended December 31, 2004, and
incorporated herein by reference.*10.20(b)
    
    Amendment No. 1 to Retirement Benefit Agreement dated as of April 3, 2006, between the registrant
and Robert J. Coury filed as Exhibit 10.11(b) to Form 10-K for the fiscal year ended March 31,
2006, and incorporated herein by reference.*10.20(c)
    
    Amendment No. 2 to Retirement Benefit Agreement dated as of December 22, 2008, between the
registrant and Robert J. Coury, filed as Exhibit 10.20(c)
to Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.*
 51




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##### Table of Contents



10.21(a)
    
    Retirement Benefit Agreement dated as of December 31, 2004, between the registrant and Edward J.
Borkowski, filed as Exhibit 10.8 to Form 10-Q for the quarter ended December 31, 2004, and
incorporated herein by reference.*10.21(b)
    
    Amendment No. 1 to Retirement Benefit Agreement dated as of April 3, 2006, between the registrant
and Edward J. Borkowski filed as Exhibit 10.12(b) to Form 10-K for the fiscal year ended March
31, 2006, and incorporated herein by reference.*10.21(c)
    
    Amendment No. 2 to Retirement Benefit Agreement dated as of December 22, 2008, between the
registrant and Edward J. Borkowski, filed as Exhibit 10.21(c)
to Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.*10.22
    
    Retirement Benefit Agreement dated January 27, 1995, between the registrant and C.B. Todd, filed
as Exhibit 10(b) to Form 10-K for the fiscal year ended March 31, 1995, and incorporated herein
by reference.*10.23(a)
    
    Retirement Benefit Agreement dated January 27, 1995, between the registrant and Milan Puskar,
filed as Exhibit 10(b) to Form 10-K for the fiscal year ended March 31, 1995, and incorporated
herein by reference.*10.23(b)
    
    First Amendment to Retirement Benefit Agreement dated September 27, 2001, between the registrant
and Milan Puskar, filed as Exhibit 10.1 to Form 10-Q for the quarter ended September 30, 2001,
and incorporated herein by reference.*10.23(c)
    
    Amendment No. 2 to Retirement Benefit Agreement dated as of April 25, 2008, by and between
registrant and Milan Puskar, filed as Exhibit 10.1 to Form 10-Q for the quarter ended June 30,
2008, and incorporated herein by reference.*10.24
    
    Split Dollar Life Insurance Arrangement between the registrant and the Milan Puskar Irrevocable
Trust filed as Exhibit 10(h) to Form 10-K for the fiscal year ended March 31, 1996, and
incorporated herein by reference.*10.25(a)
    
    Transition and Succession Agreement dated as of December 15, 2003, between the registrant and
Robert J. Coury, filed as Exhibit 10.19 to Form 10-Q for the quarter ended December 31, 2003, and
incorporated herein by reference.*10.25(b)
    
    Amendment No. 1 to Transition and Succession Agreement dated as of December 2, 2004, between the
registrant and Robert J. Coury, filed as Exhibit 10.1 to Form 10-Q for the quarter ended December
31, 2004, and incorporated herein by reference.*10.25(c)
    
    Amendment No. 2 to Transition and Succession Agreement dated as of April 3, 2006, between the
registrant and Robert J. Coury filed as Exhibit 10.19(c) to Form 10-K for the fiscal year ended
March 31, 2006, and incorporated herein by reference.*10.25(d)
    
    Amendment No. 3 to Transition and Succession Agreement dated as of December 22, 2008, between the
registrant and Robert J. Coury, filed as Exhibit 10.25(d)
to Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.*10.26(a)
    
    Transition and Succession Agreement dated as of December 15, 2003, between the registrant and
Edward J. Borkowski, filed as Exhibit 10.20 to Form 10-Q for the quarter ended December 31, 2003,
and incorporated herein by reference.*10.26(b)
    
    Amendment No. 1 to Transition and Succession Agreement dated as of December 2, 2004, between the
registrant and Edward J. Borkowski, filed as Exhibit 10.2 to Form 10-Q for the quarter ended
December 31, 2004, and incorporated herein by reference.*10.26(c)
    
    Amendment No. 2 to Transition and Succession Agreement dated as of April 3, 2006, between the
registrant and Edward J. Borkowski filed as Exhibit 10.20(c) to Form 10-K for the fiscal year
ended March 31, 2006, and incorporated herein by reference.*10.26(d)
    
    Amendment No. 3 to Transition and Succession Agreement dated as of December 22, 2008, between the
registrant and Edward J. Borkowski, filed as Exhibit 10.26(d)
to Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.*10.27(a)
    
    Amended and Restated Transition and Succession Agreement dated as of October 2, 2007, between the
registrant and Heather Bresch, filed as Exhibit 10.2 to Form 10-Q for the quarter ended March 31,
2008, and incorporated herein by reference.*10.27(b)
    
    Amendment No. 1 to Transition and Succession Agreement dated as of December 22, 2008, between the
registrant and Heather Bresch, filed as Exhibit 10.27(b)
to Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.*10.28(a)
    
    Transition and Succession Agreement dated as of January 31, 2007, between the registrant and
Rajiv Malik, filed as Exhibit 10.5 to Form 10-Q for the quarter ended March 31, 2008, and
incorporated herein by reference.*10.28(b)
    
    Amendment No. 1 to Transition and Succession Agreement dated as of December 22, 2008, between the
registrant and Rajiv Malik, filed as Exhibit 10.28(b)
to Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.*10.29
    
    Executives Retirement Savings Plan, filed as Exhibit 10.14 to Form 10-K for the fiscal year
ended March 31, 2001, and incorporated herein by reference.*
 52




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##### Table of Contents



10.30
    
    Supplemental Health Insurance Program For Certain Officers of the registrant, effective December
15, 2001, filed as Exhibit 10.1 to Form 10-Q for the quarter ended December 31, 2001, and
incorporated herein by reference.*10.31
    
    Form of Indemnification Agreement between the registrant and each Director, filed as Exhibit
10.31 to Form 10-Q/A for the quarter ended September 30, 2004, and incorporated herein by
reference.*10.32
    
    Description of the registrants Director Compensation Arrangements in effect as of the date
hereof, filed as Exhibit 10.32
to Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.*10.33
    
    Agreement Regarding Consulting Services and Shareholders Agreement dated as of December 31, 2007
by and among the registrant, MP Laboratories (Mauritius) Ltd, Prasad Nimmagadda, Globex and G2
Corporate Services Limited, filed as Exhibit 10.26 to Form 10-KT/A for the period ended December
31, 2007, and incorporated herein by reference.10.34(a)
    
    Share Purchase Agreement dated May 12, 2007 by and among Merck Generics Holding GmbH, Merck
Internationale Beteiligung GmbH, Merck KGaA and the registrant, filed with the Report on Form 8-K
filed with the SEC on May 17, 2007, and incorporated herein by reference.10.34(b)
    
    Amendment No. 1 to Share Purchase Agreement by and among the registrant and Merck Generics
Holding GmbH, Merck S.A. Merck Internationale Beteiligung GmbH and Merck KGaA, filed as Exhibit
10.1 to the Report on Form 8-K filed with the SEC on October 5, 2007, and incorporated herein by
reference.10.35
    
    Amended and Restated Credit Agreement dated as of December 20, 2007 by and among the registrant,
Mylan Luxembourg 5 S.à.r.l., certain lenders and JPMorgan Chase Bank, National Association, as
Administrative Agent, filed as Exhibit 10.1 to the Report on Form 8-K filed with the SEC on
December 27, 2007, and incorporated herein by reference.10.36
    
    Separation Agreement and Release dated February 20, 2009, by and between the registrant and
Edward J. Borkowski, filed as Exhibit 10.36
to Form 10-K for the fiscal year ended December 31, 2008, and incorporated herein by reference.*21
    
    Subsidiaries of the registrant.23
    
    Consent of Independent Registered Public Accounting Firm.31.1
    
    Certification of CEO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    Certification of CFO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32
    
    Certification of CEO and CFO pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
 *
    
    Denotes management contract or compensatory plan or arrangement. 53




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##### Table of Contents



SIGNATURES
  Mylan Inc.by
    /s/  EDWARD J. BORKOSKIEdward J. BorkowskiExecutive Vice President and
Chief Financial Officer 
 54




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##### Table of Contents



EXHIBIT INDEX
 23
    
    Consent of Independent Registered Public Accounting Firm.31.1
    
    Certification of CEO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    Certification of CFO pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32
    
    Certification of CEO and CFO pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.
 55