Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Amneal Pharmaceuticals, Inc. (the “Company”, “we,” “us,” or “our”) is a pharmaceutical company specializing in developing, manufacturing, marketing and distributing high-value generic and branded specialty pharmaceutical products across a broad array of dosage forms and therapeutic areas. The Company operates principally in the United States, India, and Ireland, and sells to wholesalers, distributors, hospitals, chain pharmacies and individual pharmacies, either directly or indirectly. The Company is a holding company, whose principal assets are common units (“Amneal Common Units”) of Amneal Pharmaceuticals, LLC (“Amneal”). In 2018, Amneal completed the acquisition of Impax Laboratories, Inc. (“Impax”), a generic and specialty pharmaceutical company.

The group, together with their affiliates and certain assignees, who owned Amneal when it was a private company (the “Amneal Group”) held 50.4% of Amneal Common Units and the Company held the remaining 49.6% as of December 31, 2021. Although the Company has a minority economic interest in Amneal, it is Amneal’s sole managing member, having the sole voting power to make all of Amneal’s business decisions and control its management. Therefore, the Company consolidates the financial statements of Amneal and its subsidiaries. The Company records non-controlling interests for the portion of Amneal’s economic interests that it does not hold.

The following discussion and analysis contains forward-looking statements that involve risks and uncertainties. Our actual results could differ materially from those anticipated in these forward-looking statements as a result of certain factors, including those set forth under Item 1A. Risk Factors and under the heading Forward-Looking Statements in this Annual Report on Form 10-K. The following discussion and analysis, as well as other sections in this report, should be read in conjunction with the consolidated financial statements and related notes to consolidated financial statements included elsewhere herein.

For a discussion of our financial condition and results of operations for the year ended December 31, 2020 compared to the year ended December 31, 2019, see “Results of Operations” and “Liquidity and Capital Resources” under Part II,Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2020 Annual Report on Form 10-K, which discussion is incorporated herein by reference.

Overview

Segments

We have three reportable segments: Generics, Specialty, and AvKARE.

Generics

Our Generics segment includes approximately 250 product families covering an extensive range of dosage forms and delivery systems, including both immediate and extended release oral solids, powders, liquids, sterile injectables, nasal sprays, inhalation and respiratory products, ophthalmics (which are sterile pharmaceutical preparations administered for ocular conditions), films, transdermal patches and topicals (which are creams or gels designed to administer pharmaceuticals locally through the skin). We focus on developing products with substantial barriers-to-entry resulting from complex drug formulations or manufacturing, or legal or regulatory challenges. Generic products, particularly in the U.S., generally contribute most significantly to revenues and gross margins at the time of their launch, and even more so in periods of market exclusivity, or in periods of limited generic competition. As such, the timing of new product introductions can have a significant impact on the Company’s financial results. The entrance into the market of additional competition generally has a negative impact on the volume and / or pricing of the affected products. Additionally, pricing is determined by market place dynamics and is often affected by factors outside of the Company’s control.

Specialty

Our Specialty segment is engaged in the development, promotion, sale and distribution of proprietary branded pharmaceutical products, with a focus on products addressing CNS disorders, including migraine and Parkinson’s disease. Our portfolio of products includes Rytary®, an extended release oral capsule formulation of carbidopa-levodopa for the treatment of Parkinson’s disease, post-encephalitic parkinsonism, and parkinsonism that may follow carbon monoxide intoxication or manganese intoxication. In addition to Rytary®, our promoted Specialty portfolio also includes Unithroid® (levothyroxine sodium), for the treatment of hypothyroidism, which is sold under a license and distribution agreement with Jerome Stevens Pharmaceuticals, Inc., and Emverm® (mebendazole) 100 mg chewable tablets, for the treatment of pinworm, whipworm, common roundworm, common hookworm and American hookworm in single or mixed infections. Effective during the three

Table of Contents

months ended September 2019, the operating results for oxymorphone were reclassified from Generics to Specialty, where it is sold as a non-promoted product.

For Specialty products, the majority of the product’s commercial value is usually realized during the period in which the product has market exclusivity. In the U.S. when market exclusivity expires and generic versions of a product are approved and marketed, there can often be very substantial and rapid declines in the branded product’s sales. For example, the pediatric exclusivity of the AstraZeneca patent licensed to Impax for Zomig® Nasal Spray expired in May 2021 and we lost market exclusivity in the fourth quarter of 2021.

AvKARE

Our AvKARE segment provides pharmaceuticals, medical and surgical products and services primarily to governmental agencies. AvKARE is a re-packager of bottle and unit dose pharmaceuticals under the registered names of AvKARE and AvPAK, which service the Department of Defense and Department of Veteran Affairs as well as institutional customers. AvKARE is also a wholesale distributor of pharmaceuticals, over the counter products and medical supplies to institutional customers which are located throughout the United States of America focused primarily on offering 340b-qualified entities products to provide consistency in care and pricing.

The Pharmaceutical Industry

The pharmaceutical industry is highly competitive and highly regulated. As a result, we face a number of industry-specific factors and challenges, which can significantly impact our results. For a more detailed explanation of our business and its risks, refer to Item 1. Business and Item 1A. Risk Factors in this Form 10-K.

COVID-19 Pandemic

In March 2020, the World Health Organization designated the outbreak of a novel strain of coronavirus (“COVID-19”) as a global pandemic. Governments and businesses around the world have taken unprecedented actions to mitigate the spread of COVID-19, including imposing restrictions on movement and travel such as quarantines and shelter-in-place requirements, and restricting or prohibiting outright some or all commercial and business activity, including the manufacture and distribution of certain goods and the provision of non-essential services. These measures, though currently temporary in nature, may become more severe and continue indefinitely depending on the evolution of the outbreak.

As a result of the pandemic, we observed lost sales and some supply interruptions during the year ended December 31, 2020 in our New York, New Jersey and India manufacturing plants. Additionally, decreased influenza activity during the year ended December 31, 2021, drove significantly lower sales volumes and increased returns related to Oseltamivir as compared to the prior year.

While manufacturing has resumed to around pre-pandemic levels, we may again experience supply chain constraints during subsequent waves of COVID-19 infections. Although not currently expected, any supply chain disruptions may significantly impact our 2022 results of operations and cash flows. Increasing infection rates and the introduction of new and more easily transmitted variants of COVID-19, such as the Delta and Omicron variants, could further disrupt our global supply chains and cause labor shortages, as well as reduce the number of physician visits in general.

To the extent that the pandemic continues or worsens, national, state, local and international governments may impose additional restrictions or extend the restrictions already in place. The worsening of the pandemic and the related safety and business operating restrictions could result in a number of adverse impacts to our business, including, but not limited to, additional disruption to the economy and our customers, additional work restrictions, supply chains being interrupted or slowed, and rising supply prices. Also, governments may impose other laws, regulations, or taxes that could adversely impact our business, financial condition, or results of operations. Further, depending on the extent to which our customers are affected, they could delay or reduce purchases of products we provide. The potential effects of the pandemic also could impact us in a number of other ways including, but not limited to, reductions to our profitability, fluctuations in foreign currency markets, the availability of future borrowings, the cost of borrowings, credit risks of our customers and counterparties, and potential impairment of the carrying amount of goodwill or other definite-lived assets.

We continue to actively monitor the situation and may take further precautionary and preemptive actions as may be required by national, state, or local authorities or that we determine are in the best interests of our employees, customers, partners, suppliers, and shareholders. Until the ultimate extent and duration of the pandemic is known, we cannot predict the ultimate effects the

Table of Contents

pandemic may have on our business, in particular with respect to demand for our products, our strategy, and our prospects, the effects on our customers, or the impact on our financial results.

Inflation

While it is difficult to accurately measure the impact of inflation, we estimate our business experienced an increase in costs due to inflation of approximately $10 million for the year ended December 31, 2021. We expect an inflationary impact of approximately $20 million for the year ending December 31, 2022. However, rising inflationary pressures due to higher input costs, including higher material, transportation, labor and other costs, could exceed our expectations and may adversely impact our operating results in future periods.

Results of Operations

Consolidated Results

The following table sets forth our summarized, consolidated results of operations (in thousands):

Years Ended December 31,

Cost of goods sold impairment charges 22,692 34,579

In-process research and development impairment charges 710 2,680

Intellectual property legal development expenses 7,716 10,655

Acquisition, transaction-related and integration expenses 8,055 8,988

Charges related to legal matters, net 25,000 5,860

Restructuring and other charges 1,857 2,398

Change in fair value of contingent consideration 200 —

Property losses and associated expenses, net 5,368 —

Provision for (benefit from) income taxes 11,196 (104,358)

Net Revenue

Net revenue for the year ended December 31, 2021 increased by 5%, or $101 million, to $2.1 billion as compared to $2.0 billion for the year ended December 31, 2020. The increase from the prior year period was attributable to growth in all three segments as follows:

•AvKARE segment revenues for the year ended December 31, 2021 increased $55 million, as compared to the prior year, due to the timing of the acquisition in 2020 and organic growth. We completed the acquisitions of the businesses that comprise our AvKARE segment on January 31, 2020 (the “Rondo Acquisitions”). Refer to Note 3. Acquisitions and Divestitures for additional information.

•Generics segment revenues for the year ended December 31, 2021 increased $23 million, as compared to the prior year, primarily due to new products launched in 2020 and 2021 that contributed net revenue growth of $176 million, as well as volume growth in products launched prior to 2020. This increase was partially offset by a $48 million decline in Oseltamivir (generic Tamiflu®) sales from lower demand and increased returns activity above historical levels that were due to decreased influenza activity during the COVID-19 pandemic, and price erosion.

•Specialty segment revenues for the year ended December 31, 2021 increased $23 million, as compared to the prior year, reflecting growth in our promoted products including Rytary® and Unithroid® of 7% and 24%, respectively, partially offset by declines in Zomig® nasal spray.

Table of Contents

Cost of Goods Sold and Gross Profit

Cost of goods sold, including impairment charges, decreased 3%, or $39 million, to $1.32 billion for the year ended December 31, 2021 as compared to $1.36 billion for the year ended December 31, 2020. The decrease in cost of goods sold, including impairment charges, compared to the prior year was primarily attributable to lower impairment charges and gross margin improvement, partially offset by an additional month of expenses from the timing of the Rondo Acquisitions and an increase in revenues. Gross margin improvement compared to the prior year was driven by procurement savings on material costs, better plant utilization, including manufacturing a higher percentage of the Company’s products, and favorable product mix.

Gross profit for the year ended December 31, 2021 was $769 million (37% of net revenue) as compared to gross profit of $628 million (32% of net revenue) for the year ended December 31, 2020. Our gross profit as a percentage of net revenue increased as compared to the prior year primarily as a result of the factors noted above.

Selling, General and Administrative

Selling, general and administrative (“SG&A”) expenses for the year ended December 31, 2021 were $366 million, as compared to $327 million for the year ended December 31, 2020. The $39 million increase from the prior year was primarily due to an increase in employee compensation, an additional month of expenses from the timing of the Rondo Acquisitions, an increase in indirect taxes, and higher freight costs due to increased volume and rising costs.

Research and Development

Research and development expenses for the year ended December 31, 2021 were $202 million, as compared to $180 million for the year ended December 31, 2020. The $22 million increase compared to the prior year was primarily attributable to $11 million related to the acquisition of Kashiv Specialty Pharmaceuticals, LLC (the “KSP Acquisition”) on April 2, 2021, an increase in in-licensing and upfront milestone payments of $3 million to grow our Specialty pipelines, and increased project spend for ongoing project costs associated with complex generic product candidates. Refer to Note 3. Acquisitions and Divestitures for additional information.

In-Process Research and Development Impairment Charges

We recognized in-process research and development (“IPR&D”) impairment charges of $1 million for the year ended December 31, 2021, as compared to $3 million for the year ended December 31, 2020. The charge for the year ended December 31, 2021 was associated with one product in our Generics segment which experienced a delay in its estimated launch date.

For the year ended December 31, 2020, the impairment charges were associated with four products in our Generics segment, three of which experienced significant price erosion, resulting in significantly lower than expected future cash flows, and the other of which was canceled due to the withdrawal of our development partner.

Intellectual Property Legal Development Expense

Intellectual property legal development expenses include, but are not limited to, costs associated with formulation assessments, patent challenge opinions and strategy, and litigation expenses to defend our intellectual property. For the year ended December 31, 2021, these expenses were $8 million as compared to $11 million for the year ended December 31, 2020. The $3 million decrease from the prior year was due to the timing of specific cases. Expenses may vary based upon the number of individual cases and corresponding litigation outstanding in a particular period.

Acquisition, Transaction-Related and Integration Expenses

Acquisition, transaction-related and integration expenses were $8 million for the year ended December 31, 2021, as compared to $9 million for the year ended December 31, 2020. For the year ended December 31, 2021, acquisition, transaction-related and integration expenses of $8 million primarily consisted of professional services fees (e.g. legal, investment banking and consulting) associated with the acquisition and integration of Puniska Healthcare Pvt. Ltd. (acquired on November 2, 2021) and the KSP Acquisition, and integration of the Rondo Acquisitions. Refer to Note 3. Acquisitions and Divestitures for additional information.

Table of Contents

For the year ended December 31, 2020, acquisition, transaction-related and integration expenses of $9 million primarily consisted of professional services fees associated with the then pending KSP Acquisition, the Rondo Acquisitions, and systems integrations associated with the acquisition of Impax.

Charges Related to Legal Matters, Net

For the year ended December 31, 2021, we recorded charges of $25 million for Corporate commercial legal proceedings and claims. For the year ended December 31, 2020, we recorded a net charge of $6 million for legal proceedings and claims, primarily related to our Generics segment. For further details, refer to Note 21. Commitments and Contingencies.

Restructuring and Other Charges

We recorded $2 million of restructuring and other charges for each of the years ended December 31, 2021 and 2020. Refer to Note 6. Restructuring and Other Charges for additional information.

Property Losses and Associated Expenses, Net

We recorded net charges for property losses and associated expenses in our Generics segment of $5 million for the year ended December 31, 2021. On September 1, 2021, Tropical Storm Ida brought extreme rainfall and flash flooding to New Jersey that caused damage to two of our facilities. Operations at these facilities were closed for the majority of September in order to assess the damage, make repairs and restore operations. Although, as a result of the significant recovery effort and sufficient safety stock, we did not incur a material business disruption for the year ended December 31, 2021, we concluded that all inventory on-hand at the time of the flooding was damaged and unsellable and that a majority of the equipment was damaged beyond repair. In addition, we incurred significant costs to repair both facilities. Accordingly, we recorded $10 million of charges for property losses and associated expenses in our Generics segment for the year ended December 31, 2021.

The Company has insurance policies for property damage, inventory losses and business interruption. Insurance recoveries are recorded in the periods when it is probable they will be realized. For the year ended December 31, 2021, insurance recoveries of $5 million associated with property and equipment were received and recorded as a reduction of property losses and associated expenses in our Generics segment. Refer to Note 28. Property Losses and Associated Expenses for additional information.

Other Expense, Net

Other expense, net was $121 million for the year ended December 31, 2021, as compared to $127 million for the year ended December 31, 2020. Overall, the decrease of $6 million from the prior year period was primarily due to a $10 million decline in interest expense due to a reduction in interest rates and a $13 million benefit related to a previously outstanding contingent liability, net of $17 million in year-over-year unfavorable net foreign exchange gains and losses.

Provision For (Benefit From) Income Taxes

The provision for (benefit from) income taxes was $11 million and ($104) million for the years ended December 31, 2021 and 2020, respectively. The effective tax rates for the years ended December 31, 2021 and 2020 were 35.7% and 291.7%, respectively.

The benefit from income taxes and effective tax rate for the year ended December 31, 2020 was primarily impacted by a $110 million carryback of U.S. Federal net operating losses under the Coronavirus Aid, Relief and Economic Security Act (“CARES Act”). The CARES Act was an emergency economic stimulus package in response to the COVID-19 pandemic which, among other things, includes provisions relating to income and non-income-based tax laws. For further details, refer to Note 8. Income Taxes.

Table of Contents

Generics

The following table sets forth the results of operations for our Generics segment (in thousands):

Years Ended December 31,

Cost of goods sold impairment charges 22,692 34,579

In-process research and development impairment charges 710 2,680

Intellectual property legal development expenses 7,562 10,647

Acquisition, transaction-related and integration expenses — 328

Charges related to legal matters, net — 5,610

Restructuring and other charges 80 (614)

Property losses and associated expenses, net 5,368 —

Net Revenue

Generics net revenue for the year ended December 31, 2021 increased by 2%, or $23 million, to $1.37 billion as compared to $1.34 billion for the year ended December 31, 2020. The increase from the prior year was primarily due to new products launched in 2020 and 2021 that contributed net revenue growth of $176 million, as well as volume growth in products launched prior to 2020. This increase was partially offset by a $48 million decline in Oseltamivir (generic Tamiflu®) sales from lower demand and increased returns activity above historical levels that were due to decreased influenza activity during the COVID-19 pandemic, and price erosion.

Cost of Goods Sold and Gross Profit

Generics cost of goods sold, including impairment charges decreased 9%, or $81 million, to $848 million for the year ended December 31, 2021 as compared to $929 million for the year ended December 31, 2020. The decrease in cost of goods sold, including impairment charges, was primarily attributable to lower impairment charges of $12 million and operational gross margin improvement due to procurement savings on material costs, better plant utilization, including manufacturing a higher percentage of the Company’s products, and favorable product mix.

Generics gross profit for the year ended December 31, 2021 was $518 million (38% of net revenue) as compared to gross profit of $414 million (31% of net revenue) for the year ended December 31, 2020 as a result of the factors described above.

Selling, General, and Administrative

Generics selling, general and administrative expense for the year ended December 31, 2021 was $65 million, an increase of 15%, or $8 million, as compared to the year ended December 31, 2020. The increasewas primarily attributable to increased employee compensation, increased shipping costs and an increase in indirect taxes, partially offset by a reduction in costs to exit redundancies in connection with Company’s integration efforts of recent business acquisitions.

Research and Development

Generics research and development expense for the year ended December 31, 2021 was $158 million, an increase of 6%, or $8 million, as compared to the year ended December 31, 2020. The increase was primarily related to higher ongoing project costs associated with complex generic product candidates of $7 million.

In-Process Research and Development Impairment Charges

We recognized Generics IPR&D impairment charges of $1 million for the year ended December 31, 2021, as compared to $3 million for the year ended December 31, 2020. The charge for the year ended December 31, 2021 was associated with one product in our Generics segment which experienced a delay in its estimated launch date.

For the year ended December 31, 2020, we recognized IPR&D impairment charges of $3 million associated with four products in our Generics segment, three of which experienced significant price erosion, resulting in significantly lower than expected future cash flows, and the other of which was canceled due to the withdrawal of our development partner

Table of Contents

Intellectual Property Legal Development Expenses

Generics intellectual property legal development expenses for the year ended December 31, 2021 were $8 million as compared to $11 million for the year ended December 31, 2020. These costs include, but are not limited to, formulation assessments, patent challenge opinions and strategy, and litigation expenses to defend our intellectual property. The $3 million decrease from the prior year was due to the timing of specific cases. Expenses may vary based upon the number of individual cases and corresponding litigation outstanding in a particular period.

Charges Related to Legal Matters, Net

There were no charges related to legal matters in our Generics segment for the year ended December 31, 2021. For the year ended December 31, 2020, we recorded a net charge of $6 million for Generics legal proceedings and claims. For further details, see Note 21. Commitments and Contingencies.

Property Losses and Associated Expenses, Net

We recorded net charges for property losses and associated expenses of $5 million in our Generics segment for the year ended December 31, 2021. On September 1, 2021, Tropical Storm Ida brought extreme rainfall and flash flooding to New Jersey that caused damage to two of our facilities. Operations at these facilities were closed for the majority of September in order to assess the damage, make repairs and restore operations. Although, as a result of the significant recovery effort and sufficient safety stock, we did not incur a material business disruption for the year ended December 31, 2021, we concluded that all inventory on-hand at the time of the flooding was damaged and unsellable and that a majority of the equipment was damaged beyond repair. In addition, we incurred significant costs to repair both facilities. Accordingly, we recorded $10 million of charges for property losses and associated expenses in our Generics segment for the year ended December 31, 2021.

Specialty

The following table sets forth the results of operations for our Specialty segment (in thousands):

Years Ended December 31,

Intellectual property legal development expenses 154 8

Acquisition, transaction-related and integration expenses 16 85

Charges related to legal matters, net — 250

Change in fair value of contingent consideration 200 —

Net Revenue

Specialty net revenue for the year ended December 31, 2021 increased 6%, or $23 million to $378 million as compared to $356 million for the year ended December 31, 2020. The increase reflected growth in our promoted products including Rytary® and Unithroid® of 7% and 24%, respectively, partially offset by declines in Zomig® nasal spray.

Cost of Goods Sold and Gross Profit

Specialty cost of goods sold for the year ended December 31, 2021 increased 0.3%, or $1 million, to $194 million as compared to $193 million for the year ended December 31, 2020. Specialty gross profit for the year ended December 31, 2021 was $185 million (49% of net revenue) as compared to gross profit of $163 million (46% of net revenue) for the year ended December 31, 2020. The increase in gross profit primarily related to the mix of revenues, including the impact of non-promoted products.

Table of Contents

Additionally, the increase in gross margin was due to growth in higher margin products which offset declines in Zomig® nasal spray, which has a higher cost structure than the overall Specialty portfolio.

Selling, General, and Administrative

Specialty selling, general and administrative expense was $84 million for the year ended December 31, 2021, an increase of $9 million or 11% compared to $76 million for the year ended December 31, 2020. The increase was driven by an increase in indirect taxes and payroll-related expenses, primarily attributable to the expansion of our sales force, and an increase in third party spend and promotional efforts as the Company began to resume activities and in-person meetings in the current year.

Research and Development

Specialty research and development expenses for the year ended December 31, 2021 were $43 million, as compared to $30 million for the year ended December 31, 2020. The $13 million increase from the prior year was primarily attributable to $10 million related to the KSP Acquisition on April 2, 2021 (refer to Note 3. Acquisitions and Divestitures for additional information) and an increase in in-licensing and upfront milestone payments of $3 million to grow our Specialty pipeline.

AvKARE

The following table sets forth the results of operations for our AvKARE segment (in thousands):

Years Ended December, 31

Acquisition, transaction-related and integration expenses 1,422 641

Operating income (loss) $ 6,798 $ (7,658)

We completed the Rondo Acquisitions on January 31, 2020. Therefore, the results of operations of our AvKARE segment reflect a full year of activity in 2021 as compared to eleven months of activity in 2020. Refer to Note 3. Acquisitions and Divestitures for additional information.

Net Revenue

AvKARE net revenue for the year ended December 31, 2021 increased 19%, or $55 million, to $349 million for the year ended December 31, 2021 from $294 million for the year ended December 31, 2020. The increase in net revenue as compared to the prior year was due to the timing of the Rondo Acquisitions in 2020 and organic growth.

Cost of Goods Sold and Gross Profit

AvKARE cost of goods sold increased 17%, or $41 million, to $283 million for the year ended December 31, 2021 as compared to $242 million for the year ended December 31, 2020. The increase in cost of goods sold as compared to the prior year was due to the timing of the Rondo Acquisitions in 2020 and organic growth.

AvKARE gross profit for the year ended December 31, 2021 was $66 million (19% of net revenue) as compared to gross profit of $52 million (18% of net revenue) for the year ended December 31, 2020. The increase in gross profit and gross profit percentage over the prior year primarily related to organic growth which more than offset a decrease in less profitable revenues. The increase in gross profit over the prior year was also due to the timing of the Rondo Acquisitions in 2020.

Selling, General, and Administrative

AvKare selling, general and administrative expense for the year ended December 31, 2021 was $58 million as compared to $59 million for the year ended December 31, 2020, as an additional month of expense due to the timing of the Rondo Acquisition and an increase in indirect taxes was offset by a decrease in amortization.

Table of Contents

Liquidity and Capital Resources

Our primary source of liquidity is cash generated from operations, available cash and borrowings under debt financing arrangements, including $489 million of available capacity on our revolving credit facility as of December 31, 2021, as defined in Note 17. Debt. We believe these sources are sufficient to fund our planned operations, meet our interest and contractual obligations and provide sufficient liquidity over the next 12 months. However, our ability to satisfy our working capital requirements and debt obligations will depend upon economic conditions, the impact of the COVID-19 pandemic, and demand for our products, which are factors that may be out of our control.

Our primary uses of capital resources are to fund operating activities, including research and development expenses associated with new product filings, and pharmaceutical product manufacturing expenses, license payments, spending on production facility expansions, capital equipment, and acquisitions. As the impact of the COVID-19 pandemic on the economy and our operations evolves, we will continue to assess our liquidity needs. A continued worldwide disruption could materially affect our future access to sources of liquidity, particularly our cash flows from operations, and financial condition. In the event of a sustained market deterioration, we may need additional liquidity, which would require us to evaluate available alternatives and take appropriate actions.

We estimate that we will invest approximately $75 to $85 million during 2022 for capital expenditures to support and grow our existing operations, primarily related to investments in manufacturing equipment, information technology and facilities.

As discussed in Note 3, Acquisitions and Divestitures, we paid $73 million for approximately 74% of the equity interests of Puniska Healthcare Pvt. Ltd. (“Puniska”) on November 2, 2021 and $4 million for land held by one of the sellers during December 2021. We will pay an additional $16 million, which we plan to fund with cash on hand, for the remaining 26% of the equity interests of Puniska and to satisfy a preexisting payable to the sellers, upon approval by the government of India which we expect during the first half of 2022. Also, as discussed in Note 3. Acquisitions and Divestitures, the KSP Acquisition closed on April 2, 2021. In addition to $74 million of cash we paid at closing, we made a payment of $30 million to satisfy deferred consideration, funded with cash on hand, on January 11, 2022. Additionally, as discussed in Note 29. Subsequent Event, we made a payment of $85 million, funded with cash on hand, on February 9, 2022 to acquire the baclofen franchise of certain entities affiliated with Saol International Limited.

Over the next 12 months, we expect to make substantial payments for monthly interest and quarterly principal amounts due for our debt instruments, including our Term Loan and Rondo Term Loan, as well as contractual payments for leased premises. Annually, we are also required to calculate the amount of excess cash flows, as defined in the Term Loan agreement. Based on the results of the excess cash flows calculation for the year ended December 31, 2020, the Company made a $14 million additional principal payment in March 2021. Based on the results of the excess cash flows calculation for the year ended December 31, 2021, no excess cash flows principal payments are due in 2022. Related to our Rondo Term Loan, we made a prepayment of $25 million towards the outstanding principal during the year ended December 31, 2021, in addition to planned principal payments. Refer to Note 17. Debt for additional information.

We are party to a tax receivable agreement (“TRA”) that requires us to make cash payments to the Members other than the Company, in respect of certain tax benefits that we may realize or may be deemed to realize as a result of sales or exchanges of Amneal common units by the Members. The timing and amount of any payments under the TRA will also vary, depending upon a number of factors including the timing and number of Amneal common units sold or exchanged for our class A Common Stock, the price of our class A Common Stock on the date of sale or exchange, the timing and amount of our taxable income, and the tax rate in effect at the time of realization of our taxable income. The tax receivable agreement also requires that we make an accelerated payment to the Members equal to the present value of all future payments due under the agreement upon certain change of control and similar transactions. Further sales or exchanges occurring subsequent to December 31, 2021 could result in future Amneal tax deductions and obligations to pay 85% of such benefits to the holders of Amneal common units. These obligations could be incremental to and substantially larger than the approximate $206 million contingent liability as of December 31, 2021. As a result of the foregoing, our obligations under the tax receivable agreement could have a substantial negative impact on our liquidity. For further information, refer to Item 1A. Risk Factors and Note 8. Income Taxes.

In addition, pursuant to the limited liability operating agreement of Amneal, as amended, in connection with any tax period, we are required to make distributions to Amneal's members, on a pro rata basis in proportion to the number of Amneal Common Units held by each member, of cash until each member (other than Amneal) has received an amount at least equal to its assumed tax liability and Amneal has received an amount sufficient to enable it to timely satisfy all of its U.S. federal, state and local and non-U.S. tax liabilities, and meet its obligations pursuant to the tax receivable agreement. During the year ended December 31, 2021, we made tax distributions of $53 million to Amneal's members.

Table of Contents

At December 31, 2021, our cash and cash equivalents consist of cash on deposit and highly liquid investments. A portion of our cash flows are derived outside the United States. As a result, we are subject to market risk associated with changes in foreign exchange rates. We maintain cash balances at both U.S. based and foreign country based commercial banks. At various times during the year, our cash balances held in the United States may exceed amounts that are insured by the Federal Deposit Insurance Corporation. We make our investments in accordance with our investment policy. The primary objectives of our investment policy are liquidity and safety of principal.

Cash Flows

For a discussion comparing of our cash flows for the fiscal years 2020 to 2019, see Cash Flows under Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations in our 2020 Annual Report on Form 10-K.

The following table sets forth our summarized, consolidated cash flows for the years ended December 31, 2021 and 2020 (in thousands):

Years Ended December 31,

Cash provided by (used in):

Effect of exchange rate changes on cash 102 1,037

Cash Flows from Operating Activities

Net cash provided by operating activities was $242 million for the year ended December 31, 2021 as compared to $379 million for the year ended December 31, 2020. Excluding the Federal tax refund and related interest of $110 million received in August 2020 (refer to Note 8. Income taxes for additional information), cash provided by operating activities for the year ended December 31, 2021 decreased $27 million as compared to the prior year. The year-over-year decrease was primarily a result of increased rebate payments and other pricing adjustments as well as other working capital movements, which more than offset an increase in net income, excluding the Federal tax refund mentioned above.

Cash Flows from Investing Activities

Net cash used in investing activities was $194 million for the year ended December 31, 2021 compared to $318 million for the year ended December 31, 2020. The $123 million decrease in net cash used in investing activities for the year ended December 31, 2021 as compared to the prior year was primarily due to $254 million of net cash paid for the Rondo Acquisitions in 2020 as compared to $147 million paid for the Puniska Acquisition and the KSP Acquisition in 2021, and a decrease in purchases of property, plant and equipment in 2021.

Cash Flows from Financing Activities

Net cash provided used in financing activities was $138 million for the year ended December 31, 2021 as compared to net cash provided by financing activities of $132 million for the year ended December 31, 2020. The $269 million year-over-year change was primarily attributable to net proceeds from the $180 million term loan associated with the Rondo Acquisitions (“Rondo Term Loan”) in 2020, an increase in year-over-year tax distributions made to non-controlling interests of $54 million, and an increase in year-over-year payments on debt, primarily the $25 million prepayment on the Rondo Term Loan and $14 million paid to satisfy the excess cash flow requirements of Amneal’s term loan. Refer to Note 17. Debt for additional information about our indebtedness.

Table of Contents

Commitments and Contractual Obligations

Our contractual obligations as of December 31, 2021 were as follows (in thousands):

Payments Due by Period

Contractual Obligations Total LessThan 1Year 1-3Years 3-5Years MoreThan 5Years

Kashiv Specialty Pharmaceuticals, LLC acquisition (5) 30,500 30,500 — — —

(1)A description of our Term Loan, and related debt service and interest requirements is contained in Note 17. Debt. Interest on our Term Loan was calculated based on applicable rates at December 31, 2021, including any impact from our interest rate swap.

(2)Amounts represent future minimum rental payments under non-cancelable leases for certain facilities. A discussion of our operating lease obligations is contained in Note 12. Leases.

(3)Amounts primarily represent future minimum rental payments under non-cancelable financing lease obligation for a production facility in New York. A discussion of our financing lease obligations is contained in Note 12. Leases.

(4)Rondo Term Loan relates to the Rondo Acquisitions. Interest on the Rondo Term Loan was calculated based on the applicable rate at December 31, 2021. A discussion of the Rondo Term Loan, and related debt service and interest requirements is contained in Note 17. Debt.

(5)Amount represents deferred consideration for the acquisition of Kashiv Specialty Pharmaceuticals, LLC, which closed on April 2, 2021. The deferred consideration consists of $30 million, which was paid on January 11, 2022 and $0.5 million which is due on March 10, 2022. Refer to Note 3. Acquisitions and Divestitures for additional information.

The foregoing table does not include milestone payments potentially payable by the Company under its collaboration agreements and licenses. Such milestone payments are dependent upon the occurrence of specific and contingent events, and not the passage of time. A discussion of our significant contingent milestones is contained in Note 5. Alliance and Collaboration and Note 24. Related Party Transactions. Additionally, the foregoing table does not include $44 million of aggregate principal and the related interest due on the long-term promissory notes. Refer to the section Acquisition Financing – Notes Payable-Related Party in Note 17. Debt for a discussion of this indebtedness.

Off-Balance Sheet Arrangements

We did not have any off-balance sheet arrangements as of December 31, 2021.

Critical Accounting Policies

Our significant accounting policies are described in Note 2. Summary of Significant Accounting Policies.

Included within these policies are certain policies which contain critical accounting estimates and, therefore, have been deemed to be “critical accounting policies.” Critical accounting estimates are those which require management to make assumptions about matters that were uncertain at the time the estimate was made and for which the use of different estimates, which reasonably could have been used, or changes in the accounting estimates that are reasonably likely to occur from period to period could have a material impact on our financial condition or results of operations. We have identified the following to be our critical accounting policies: sales-related deductions, impairment of goodwill and intangible assets, income taxes and contingencies.

Table of Contents

Sales-Related Deductions

Our gross product revenue is subject to a variety of deductions, which are estimated and recorded in the same period that the revenue is recognized, and primarily represent chargebacks, rebates, group purchasing organization fees, prompt payment (cash) discounts, consideration payable to the customer, billbacks, Medicaid and other government pricing programs, price protection and shelf stock adjustments, and sales returns. Those deductions represent estimates of rebates and discounts related to gross sales for the reporting period and, as such, knowledge and judgment of market conditions and practice are required when estimating the impact of these revenue deductions on gross sales for a reporting period.

Historically, our changes of estimates reflecting actual results or updated expectations have not been material to our overall business. If any of our ratios, factors, assessments, experiences or judgments are not indicative or accurate predictors of our future experience, our results could be materially affected. The sensitivity of our estimates can vary by program, type of customer and geographic location. However, estimates associated with governmental allowances, Medicaid and other performance-based contract rebates are most at risk for material adjustment because of the extensive time delay between the recording of the accrual and its ultimate settlement, an interval that can generally range up to one year. Because of this time lag, in any given quarter, our adjustments to actual can incorporate revisions of several prior quarters.

Business Combinations

We account for acquired businesses using the acquisition method of accounting, which requires that assets acquired and liabilities assumed be recorded at the date of acquisition at their respective fair values. The consolidated financial statements and results of operations reflect an acquired business after the completion of the acquisition. The fair value of the consideration paid is assigned to the underlying net assets of the acquired business based on their respective fair values as determined using a market participant concept. Any excess of the purchase price over the fair value of net assets and other identifiable intangible assets acquired is recorded as goodwill.

Intangible assets are amortized over the estimated useful life of the asset. Significant judgments are used in determining the estimated fair values assigned to the assets acquired and liabilities assumed and in determining estimates of useful lives of long-lived assets. Fair value determinations and useful life estimates are based on, among other factors, estimates of expected future net cash flows, estimates of appropriate discount rates used to present value expected future net cash flow streams, the assessment of each asset’s life cycle, competitive trends impacting the asset and each cash flow stream, as well as other factors. These judgments can materially impact the estimates used to allocate acquisition date fair values to assets acquired and liabilities assumed and the future useful lives. For these and other reasons, actual results may vary significantly from estimated results.

Impairment of Goodwill and Intangible Assets

Goodwill

Goodwill, which represents the excess of purchase price over the fair value of net assets acquired, is carried at cost. Goodwill is not amortized; rather, it is subject to a periodic assessment for impairment by applying a fair value based test. We test goodwill for possible impairment annually during the fourth quarter, or whenever events or circumstances indicate that the carrying amount may not be recoverable.

In order to test goodwill for impairment, an entity is permitted to first assess qualitative factors to determine whether a quantitative assessment of goodwill is necessary. The qualitative factors considered by the Company may include, but are not limited to, general economic conditions, the Company’s outlook, market performance of the Company’s industry and recent and forecasted financial performance. Further testing is only required if the entity determines, based on the qualitative assessment, that it is more likely than not that a reporting unit’s fair value is less than its carrying amount. Otherwise, no further impairment testing is required. If a quantitative assessment is required, the Company determines the fair value of its reporting unit using a combination of the income and market approaches. If the net book value of the reporting unit exceeds its fair value, the Company recognizes a goodwill impairment charge for the reporting unit equal to the lesser of (i) the total goodwill allocated to that reporting unit and (ii) the amount by which that reporting unit’s carrying amount exceeds its fair value.

Goodwill is allocated and evaluated for impairment at the reporting unit level, which is defined as an operating segment or one level below an operating segment. As a result of the Rondo Acquisitions, we added a third reportable segment, AvKARE, to our existing reportable segments, Generics and Specialty. Our reportable segments are the same as the respective operating segments and reporting units. As of December 31, 2021, $363 million, $160 million, and $70 million of goodwill was allocated to the Specialty, Generics, and AvKARE segments, respectively. During the fourth quarter of 2021, we tested each of the

Table of Contents

reporting units for impairment using a quantitative assessment. The determination of fair value in the quantitative assessment required us to make significant estimates and assumptions. These estimates and assumptions primarily included, but were not limited to: the selection of appropriate peer group companies, the discount rate, terminal growth rates, and forecasts of revenue, operating income, depreciation and amortization, restructuring charges and capital expenditures. For more information see Note 15. Goodwill and Other Intangible Assets. There was no impairment of goodwill in any reporting unit for the year ended December 31, 2021.

Significant judgment is employed in determining the assumptions utilized in our quantitative assessment. Accordingly, any changes in assumptions described above could have a material impact on our consolidated results of operations. Additionally, for each of our reporting units, there are a number of future events and factors that may impact future results and the outcome of subsequent goodwill impairment testing. For a list of these factors, see Item 1A. Risk Factors.

Intangible Assets

We review our long-lived assets, including intangible assets with finite lives, for recoverability whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. We evaluate assets for potential impairment by comparing estimated future undiscounted net cash flows to the carrying amount of the asset. If the carrying amount of the assets exceeds the estimated future undiscounted cash flows, impairment is measured based on the difference between the carrying amount of the assets and fair value which is generally an expected present value cash flow technique. Our policy in determining whether an impairment indicator exists comprises measurable operating performance criteria as well as other qualitative measures. Events giving rise to impairment are an inherent risk in the pharmaceutical industry and cannot be predicted. Factors that we consider in deciding when to perform an impairment review include significant under-performance of a product in relation to expectations, significant negative industry or economic trends, and significant changes or planned changes in our use of the assets. If our assumptions are not correct, there could be an impairment loss in subsequent periods or, in the case of a change in the estimated useful life of the asset, a change in amortization expense.

Intangible assets with indefinite lives, including in-process research and development (“IPR&D”), are tested for impairment if impairment indicators arise and, at a minimum, annually. However, an entity is permitted to first assess qualitative factors to determine if a quantitative impairment test is necessary. Further testing is only required if the entity determines, based on the qualitative assessment, that it is more likely than not that an indefinite-lived intangible asset’s fair value is less than its carrying amount. Otherwise, no further impairment testing is required. The indefinite-lived intangible asset impairment test consists of a one-step analysis that compares the fair value of the intangible asset with its carrying amount. If the carrying amount of an intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. We consider many factors in evaluating whether the value of its intangible assets with indefinite lives may not be recoverable, including, but not limited to the discount rate, terminal growth rates, general economic conditions, our outlook and market performance of our industry and recent and forecasted financial performance.

The impairment charges for the year ended December 31, 2021 were primarily related to seven currently marketed products and one IPR&D product. For the currently marketed products, five products experienced significant price erosion during 2021, without an offsetting increase in customer demand, resulting in significantly lower than expected future cash flows and negative margins. Of the five currently marketed products that experienced significant price erosion during 2021, Levothyroxine contributed $17.7 million of the $23.4 million in cost of goods sold impairment charges (refer to Note 5. Alliance and Collaboration for additional information about the Company’s Levothyroxine license with JSP).Additionally, the supply agreements for two currently marketed products will be terminated early due to market conditions. The IPR&D charge was associated with one product which experienced a delay in its estimated launch date. Refer to Note 15. Goodwill and Other Intangible Assets for additional information.

Contingent Consideration

Business acquisitions may include future payments that are contingent upon the occurrence of certain pharmaceutical regulatory milestones or net sales of pharmaceutical products. For acquisitions that are accounted for as a business combination, the obligations for such contingent consideration payments are recorded at fair value on the acquisition date. For contingent milestone payments, the Company uses a probability-weighted income approach utilizing an appropriate discount rate. For contingent tiered royalties on net sales, the Company uses a Monte Carlo simulation model. Contingent consideration liabilities are revalued to fair value at the end of each reporting period. Changes in the fair value of contingent consideration, other than changes due to payments, are recognized as a gain or loss and recorded within change in fair value of contingent consideration in the consolidated statements of operations.

Table of Contents

The fair value measurement of the contingent consideration liabilities was determined based on significant unobservable inputs, including the discount rate, estimated probabilities of success, timing of achieving specified regulatory milestones and the estimated amount of future sales of the acquired products. The contingent consideration liability is estimated by applying a probability-weighted expected payment model for contingent milestone payments and a Monte Carlo simulation model for contingent royalty payments, which are then discounted to present value. Changes to fair value of the contingent consideration liabilities can result from changes to one or a number of the aforementioned inputs. If different assumptions were used for various inputs, the estimated fair value could be higher or lower than what the Company determined.

For the year ended December 31, 2021, the change in the fair value of contingent consideration was $0.2 million. As of December 31, 2021, contingent consideration of $6 million was accrued in related party payable-long term.

Income Taxes

We record valuation allowances against our DTAs when it is more likely than not that all or a portion of a DTA will not be realized. We routinely evaluate the realizability of our DTAs by assessing the likelihood that our DTAs will be recovered based on all available positive and negative evidence, including scheduled reversals of deferred tax liabilities, estimates of future taxable income, tax planning strategies and results of operations. Estimating future taxable income is inherently uncertain and requires judgment. In projecting future taxable income, we consider our historical results and incorporate certain assumptions, including projected new product launches, revenue growth, and operating margins, among others.

A valuation allowance, if needed, reduces DTAs to the amount expected to be realized. When determining the amount of net DTAs that are more likely than not to be realized, we assess all available positive and negative evidence. This evidence includes, but is not limited to, prior earnings history, projected future earnings, carryback and carry-forward periods and the feasibility of ongoing tax strategies that could potentially enhance the likelihood of the realization of a DTA. The weight given to the positive and negative evidence is commensurate with the extent the evidence may be objectively verified. As such, it is generally difficult for positive evidence regarding projected future taxable income to outweigh objective negative evidence of recent financial reporting losses.

As of December 31, 2021, based upon all available objective and verifiable evidence both positive and negative, including historical levels of pre-tax income (loss) both on a consolidated basis and tax reporting entity basis, legislative developments, expectations and risks associated with estimates of future pre-tax income, and prudent and feasible tax planning strategies, we determined that it is more likely than not that we will not realize the benefits of our gross DTAs. Accordingly, as of December 31, 2021, this valuation allowance was $417 million and reduced the carrying value of these gross DTAs, net of the impact of the reversal of taxable temporary differences, to zero.

As described in Note 8. Income Taxes, we are a party to a TRA under which we are generally required to pay to the other holders of Amneal Common Units 85% of the applicable tax savings, if any, in U.S. federal and state income tax that we are deemed to realize as a result of certain tax attributes of their Amneal Common Units sold to us (or exchanged in a taxable sale) and that are created as a result of (i) the sales of their Amneal Common Units for shares of Class A common stock and (ii) tax benefits attributable to payments made under the TRA.

The timing and amount of any payments under the TRA may vary, depending upon a number of factors including the timing and number of Amneal common units sold or exchanged for our Class A Common Stock, the price of our Class A Common Stock on the date of sale or exchange, the timing and amount of our taxable income, and the tax rate in effect at the time of realization of the our taxable income (the TRA liability is determined based on a percentage of the corporate tax savings from the use of the TRA's attributes).Further sales or exchanges occurring subsequent to December 31, 2021 could result in future Amneal tax deductions and obligations to pay 85% of such benefits to the holders of Amneal common units.

The projection of future taxable income involves significant judgment. Actual taxable income may differ materially from our estimates, which could significantly impact our liabilities under the TRA. As noted above, we have determined it is more-likely-than-not we will be unable to utilize all of our DTAs subject to the TRA; therefore, as of December 31, 2021, we had not recognized the contingent liability under the TRA related to the tax savings we may realize from common units sold or exchanged. If utilization of these DTAs becomes more-likely-than-not in the future, at such time, these TRA liabilities (which amount to approximately $206 million as of December 31, 2021, as a result of basis adjustments under Internal Revenue Code Section 754) will be recorded through charges to our statements of operations.However, if the tax attributes are not utilized in future years, it is reasonably possible no amounts would be paid under the TRA.Should we determine that a DTA with a valuation allowance is realizable in a subsequent period, the related valuation allowance will be released and if a resulting TRA payment is determined to be probable, a corresponding TRA liability will be recorded.

Table of Contents

Contingencies

We are involved in various litigation, government investigations and other legal proceedings that arise from time to time in the ordinary course of business. Our legal proceedings are complex, constantly evolving and subject to uncertainty. As such, we cannot predict the outcome or impact of our legal proceedings.

While we believe we have valid claims and/or defenses for the matters described in Note 21. Commitments and Contingencies, the nature of litigation is unpredictable and the outcome of the following proceedings could include damages, fines, penalties and injunctive or administrative remedies. For any proceedings where losses are probable and reasonably capable of estimation, we accrue for a potential loss. When we have a probable loss for which a reasonable estimate of the liability is a range of losses and no amount within that range is a better estimate than any other amount, we record the loss at the low end of the range. While these accruals have been deemed reasonable by our management, the assessment process relies heavily on estimates and assumptions that may ultimately prove inaccurate or incomplete. Additionally, unforeseen circumstances or events may lead us to subsequently change our estimates and assumptions. The process of analyzing, assessing and establishing reserve estimates relative to legal proceedings involves a high degree of judgment.

Although the outcome and costs of the asserted and unasserted claims is difficult to predict, based on the information presently known to management, we do not currently expect the ultimate liability, if any, for such matters to have a material adverse effect on our business, financial condition, results of operations, or cash flows.

For further details, see Note 21. Commitments and Contingencies.

Recently Issued Accounting Standards

Recently issued accounting standards are discussed in Note 2. Summary of Significant Accounting Policies.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Our cash is held on deposit in demand accounts at large financial institutions in amounts in excess of the FDIC insurance coverage limit of $250,000 per depositor, per FDIC-insured bank, per ownership category. Our cash equivalents are comprised of highly rated money market funds. We had no short-term investments as of December 31, 2021 or December 31, 2020.

Financial instruments that potentially subject us to concentrations of credit risk consist principally of cash equivalents and accounts receivable. We limit our credit risk associated with cash equivalents by placing investments with high credit quality securities, including U.S. government securities, treasury bills, corporate debt, short-term commercial paper and highly rated money market funds. As discussed in Note 17. Debt, we are party to a term loan with a principal amount of $2.7 billion and an asset backed revolving credit facility under which loans and letters of credit up to a principal amount of $489 million are available as of December 31, 2021 (principal amount of up to $25 million is available for letters of credit). The proceeds for any loans made under our asset backed revolving credit facility are available for capital expenditures, acquisitions, working capital needs and other general corporate purposes.

We limit our credit risk with respect to accounts receivable by performing credit evaluations when deemed necessary. We do not require collateral to secure amounts owed to us by our customers.

By the nature of our global operations, we are exposed to cash flow and earnings fluctuations resulting from foreign exchange rate variation. These exposures are transactional and translational in nature. Since we manufacture and sell our products throughout the world, we believe our foreign currency risk is diversified. Principal drivers of this diversified foreign exchange exposure include the European Euro, Indian Rupee, and the Swiss Franc. Our transactional exposure arises from the purchase and sale of goods and services in currencies other than the functional currency of our operational units. We also have exposure related to the translation of financial statements of our foreign divisions into U.S. dollars, our functional currency. The financial statements of our operations outside the U.S. are measured using the local currency as the functional currency. Adjustments to translate the assets and liabilities of these foreign operations into U.S. dollars are accumulated as a component of other comprehensive income/(loss). Transaction gains and losses are included in the determination of our net income in our statements of operations. Such foreign currency transaction gains and losses include fluctuations related to long term intercompany loans that are payable in the foreseeable future.

Table of Contents

costs, including higher material, transportation, labor and other costs, could exceed our expectations and may adversely impact our operating results in future periods.

In the normal course of operations, we are exposed to market risks relating to our long-term debt arising from adverse changes in interest rates. Market risk is defined for these purposes as the potential change in the fair value of a financial asset or liability resulting from an adverse movement in interest rates. Changes in interest rates impact fixed and variable rate debt differently. For fixed rate debt, a change in interest rates will impact only the fair value of the debt, whereas for variable rate debt, a change in the interest rates will impact interest expense and cash flows.

At December 31, 2021 and 2020, we had $2.7 billion and $2.8 billion, respectively, of variable rate debt. Our debt as of December 31, 2021 comprised of our Term Loan, with principal outstanding of $2.6 billion, and our Rondo Term Loan, with principal outstanding of $139 million. We estimated the fair values of the Term Loan and Rondo Term loan using quoted prices in active markets and yields for the same or similar types of borrowings, taking into account the underlying terms of the debt instruments. At both December 31, 2021 and 2020, we estimated the fair value of the Term Loan to be $2.6 billion. We estimated the fair value of the Rondo Term loan to be $139 million and $172 million at December 31, 2021 and 2020, respectively. A hypothetical 100 basis point increase in market interest rates would potentially reduce the estimated fair value of our Term Loan by approximately $77 million and the Rondo Term Loan by approximately $4 million as of December 31, 2021.

In October 2019, we entered into an interest rate lock agreement for a total notional amount of $1.3 billion whereby we exchanged floating for fixed rate interest payments for our LIBOR based borrowing under our Term Loan. At inception and at year end, we assessed hedge effectiveness and determined it to continue to be highly effective. We also reviewed the credit standing of the counterparty at year end and deemed the counterparties to have the ability to honor their obligations. The fair value of the variable-to-fixed interest rate swap was a liability of $11 million as of December 31, 2021. We estimated that a hypothetical 100 basis point increase in the forward one-month LIBOR curve would potentially change the fair value of the variable-to-fixed interest rate swap from a liability of $11 million to an asset of $29 million as of December 31, 2021. We estimated that a hypothetical 100 basis point decrease in the forward one-month LIBOR curve would potentially change the fair value of the variable-to-fixed interest rate swap from a liability of $11 million to a liability of $40 million as of December 31, 2021.

Increases or decreases in interest rates would affect our annual interest expense. Based on the principal amount of the Term Loan outstanding as of December 31, 2021, a hypothetical 100 basis point increase or decrease in interest rates would have affected our annual interest expense by approximately $26 million (before the impact of the interest rate lock agreement discussed above). Based on the principal amount of the Rondo Term Loan outstanding as of December 31, 2021, a hypothetical 100 basis point increase or decrease in interest rates would have affected our annual interest expense by approximately $1 million.

Item 8. Financial Statements and Supplementary Data

The consolidated financial statements listed in Item 15. Exhibits, Financial Statement Schedules are filed as part of this Annual Report on Form 10-K and incorporated by reference herein.

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Not applicable.

Item 9A. Controls and Procedures

Disclosure Controls and Procedures

We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) that are designed to ensure information required to be disclosed by us in reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Co-Chief Executive Officers and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

Our management, with the participation of our Co-Chief Executive Officers and Chief Financial Officer, evaluated the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this

Table of Contents

Annual Report on Form 10-K. Based upon that evaluation, our Co-Chief Executive Officers and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of December 31, 2021.

Management's Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). Management conducted an assessment of the effectiveness of our internal control over financial reporting based on the criteria set forth in Internal Control - Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework). Based on the assessment, management has concluded that our internal control over financial reporting was effective as of December 31, 2021. Ernst & Young has independently assessed the effectiveness of our internal control over financial reporting and its report is included below.

Changes in Internal Control over Financial Reporting

In October 2021, as part of our ongoing efforts to increase efficiencies we implemented new software and updated various business processes related to sales deductions. Except as noted above, there were no changes in internal control over financial reporting which materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Limitation on Effective Controls

Management, including our Co-Chief Executive Officers and Chief Financial Officer, does not expect that our disclosure controls and procedures or its system of internal control over financial reporting will prevent or detect all errors and all fraud. A control system, no matter how well designed or operated, can provide only reasonable, but not absolute, assurance that the objectives of the system of internal control are met. The design of our control system reflects the fact that there are resource constraints, and that the benefits of such control system must be considered relative to their costs. Further, because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control failures and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the intentional acts of individuals, by collusion of two or more people, or by management override of the controls. The design of any system of controls is also based in part on certain assumptions about the likelihood of future events, and there can be no assurance that the design of any particular control will always succeed in achieving its objective under all potential future conditions.

Table of Contents

Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of Amneal Pharmaceuticals, Inc.

Opinion on Internal Control over Financial Reporting

We have audited Amneal Pharmaceuticals Inc.’s internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control — Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Amneal Pharmaceuticals, Inc. (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2021, based on the COSO criteria.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of the Company as of December 31, 2021 and 2020, the related consolidated statements of operations, comprehensive income (loss), changes in stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2021, and the related notes and our report dated March 1, 2022 expressed an unqualified opinion thereon.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.

Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Ernst & Young LLP

Iselin, New Jersey

March 1, 2022

Table of Contents

Item 9B. Other Information

None.

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

Not applicable.

Table of Contents

PART III.

Item 10. Directors, Executive Officers and Corporate Governance

The information required in this Item 10 will be included in the following sections in the 2022 Proxy Statement, which sections are incorporated in this Item 10 by reference: “Proposal No. 1-Election of Directors”, “Our Management”, “Committees of the Board of Directors”, “Audit Committee” and, if included in the 2022 Proxy Statement, “Delinquent Section 16(a) Reports”.

Code of Business Conduct for Principal Executive Officer, Principal Financial Officer and Principal Accounting Officer. We have adopted a Code of Business Conduct that applies to all of our employees, officers and directors. The full text of our Code of Business Conduct is available at the investors section of our website, http://investors.amneal.com. We intend to disclose any amendment to, or waiver from, a provision of the Code of Business Conduct that applies to our principal executive officer, principal financial officer or principal accounting officer in the investors section of our website.

Item 11. Executive Compensation

The information required in this Item 11 will be included in the following sections in the 2022 Proxy Statement, which sections are incorporated in this Item 11 by reference: “Compensation Discussion and Analysis,” “Executive Compensation,” “Director Compensation,” “The Board’s Role in Risk Oversight,” “Compensation Committee Interlocks and Insider Participation” and “Report of the Compensation Committee.” Notwithstanding the foregoing, the information in the section entitled “Report of the Compensation Committee” is only “furnished” herein and shall not be deemed “filed” for purposes of Section 18 of the Exchange Act.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Except as set forth below, the information required in this Item 12 will be included in the section entitled “Beneficial Ownership” in the 2022 Proxy Statement, which section is incorporated in this Item 12 by reference.

Securities Authorized for Issuance Under Equity Compensation Plans. The following table summarizes information, as of December 31, 2021, relating to the Amneal Pharmaceuticals, Inc. 2018 Incentive Award Plan, which was approved by the Company’s stockholders and which authorizes the grant of stock options, stock appreciation rights, restricted stock awards, restricted stock unit awards, other stock or cash-based awards and dividend equivalent awards to employees, non-employee directors and consultants.

Equity Compensation Plan Information

Equity compensation plans not approved by security holders — — —

(1)Equity compensation plans approved by security holders which are included in column (a) of the table are the 2018 Incentive Award Plan (including 3,023,124 shares of Class A Common Stock to be issued upon exercise of outstanding options and 13,183,600 shares of Class A Common Stock to be issued upon vesting and settlement of outstanding RSUs subject to continued employment) and 28,376 of options remaining from the Impax option conversion associated with the acquisition of Impax on May 4, 2018. RSUs included in column (a) of the table represent the full number of RSUs awarded and outstanding whereas the number of shares of Class A Common Stock

Table of Contents

to be issued upon vesting will be lower than what is reflected on the table because the value of shares required to meet employee tax withholding requirements are not issued.

(2)Column (b) relates to stock options and does not include any exercise price for RSUs because an RSU’s value is dependent upon attainment of continued employment or service and they are settled for shares of Class A Common Stock on a one-for-one basis.

Item 13. Certain Relationships and Related Transactions, and Director Independence

The information required in this Item 13 will be included in the following sections in the 2022 Proxy Statement, which sections are incorporated in this Item 13 by reference: “Certain Related Parties and Related Party Transactions,” “Controlled Company Status” and “Committees of the Board of Directors.”

Item 14. Principal Accounting Fees and Services

The independent registered public accounting firm is Ernst & Young LLP, Iselin, NJ, PCAOB ID 42 .

The information required in this Item 14 will be included in the section entitled “Independent Registered Public Accounting Firm Fees” in the 2022 Proxy Statement, which section is incorporated in this Item 14 by reference.

Table of Contents

PART IV.

Item 15. Exhibits, Financial Statement Schedules

(a)(1) Consolidated Financial Statements

Index to financial statements and supplementary data filed as part of this Report.

Report of Independent Registered Public Accounting Firm (PCAOB ID 42) F-1

Consolidated Statements of Operations F-5

Consolidated Statements of Comprehensive Income (Loss) F-6

Consolidated Balance Sheets F-7

Consolidated Statements of Changes in Stockholders' Equity F-8

Consolidated Statements of Cash Flows F-11

Notes to Consolidated Financial Statements F-12

(a)(2) Financial Statement Schedules

All schedules are omitted because they are not required or because the required information is included in the Consolidated Financial Statements or notes thereto.

(a)(3) Exhibits

See the "Exhibit Index" prior to the signature page of this Annual Report on Form 10-K.

Item 16. Form 10-K Summary

None.

Table of Contents

Report of Independent Registered Public Accounting Firm

To the Stockholders and the Board of Directors of Amneal Pharmaceuticals, Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Amneal Pharmaceuticals, Inc. (the Company) as of December 31, 2021 and 2020, the related consolidated statements of operations, comprehensive income (loss), changes in stockholders' equity and cash flows for each of the three years in the period ended December 31, 2021, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2021, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated March 1, 2022 expressed an unqualified opinion thereon.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

F-1

Table of Contents

Medicaid Rebates

Sales Returns

F-2

Table of Contents

Impairment of Intangible Assets with Finite Lives

F-3

Table of Contents

Impairment of Goodwill and Other Indefinite-lived Intangible Assets

/s/ Ernst & Young LLP

We have served as the Company’s auditor since 2008.

Iselin, New Jersey

March 1, 2022

F-4

Table of Contents

Amneal Pharmaceuticals, Inc.

Consolidated Statements of Operations

(in thousands, except per share amounts)

Years Ended December 31,

In-process research and development impairment charges 710 2,680 46,619

Acquisition, transaction-related and integration expenses 8,055 8,988 16,388

Change in fair value of contingent consideration 200 — —

Property losses and associated expenses, net 5,368 — —

Other (expense) income:

Gain on sale of international businesses — 123 7,258

Gain from reduction of tax receivable agreement liability — — 192,884

Class A and Class B-1 diluted $ 0.07 $ 0.61 $ (2.74)

Weighted-average common shares outstanding:

The accompanying notes are an integral part of these consolidated financial statements.

F-5

Table of Contents

Amneal Pharmaceuticals, Inc.

Consolidated Statements of Comprehensive Income (Loss)

(in thousands)

Years Ended December 31,

Other comprehensive income (loss):

Foreign currency translation adjustments

Foreign currency translation adjustments, net (8,618) (13,500) 2,180

Unrealized gain (loss) on cash flow hedge, net of tax 42,430 (70,276) 16,373

The accompanying notes are an integral part of these consolidated financial statements.

F-6

Table of Contents

Amneal Pharmaceuticals, Inc.

Consolidated Balance Sheets

(in thousands)

Assets

Current assets:

Prepaid expenses and other current assets 110,218 73,467

Operating lease right-of-use assets - related party 20,471 24,792

Financing lease right-of-use assets 64,475 9,541

Financing lease right-of-use assets - related party — 58,676

Liabilities and Stockholders’ Equity

Current liabilities:

Current portion of long-term debt, net 30,614 44,228

Current portion of operating lease liabilities 9,686 6,474

Current portion of financing lease liabilities 3,101 1,794

Current portion of note payable - related party — 1,000

Related party payables - short term 47,861 7,561

Operating lease liabilities - related party 18,783 23,049

Financing lease liabilities - related party — 60,193

Related party payable - long term 9,619 1,584

Commitments and contingencies (Notes 5 & 21)

Stockholders’ equity:

Accumulated other comprehensive loss (24,827) (41,318)

Total Amneal Pharmaceuticals, Inc. stockholders’ equity 360,340 303,271

The accompanying notes are an integral part of these consolidated financial statements.

F-7

Table of Contents

Amneal Pharmaceuticals, Inc.

Consolidated Statement of Changes in Stockholders’ Equity

(in thousands)

Shares Amount Shares Amount

Foreign currency translation adjustments — — — — — — (4,255) (4,363) (8,618)

Stock-based compensation — — — — 28,412 — — — 28,412 —

Non-controlling interests from KSP Acquisition — — — — — — — 2,000 2,000 —

Non-controlling interests from Puniska Acquisition — — — — — — — — — 1,742

The accompanying notes are an integral part of these consolidated financial statements.

F-8

Table of Contents

Amneal Pharmaceuticals, Inc.

Consolidated Statement of Changes in Stockholders’ Equity

(in thousands)

Shares Amount Shares Amount

Foreign currency translation adjustments — — — — — — (6,643) (6,857) (13,500) —

Stock-based compensation — — — — 20,750 — — — 20,750 —

Non-controlling interests from Rondo Acquisition — — — — — — — — — 11,475

The accompanying notes are an integral part of these consolidated financial statements.

F-9

Table of Contents

Amneal Pharmaceuticals, Inc.

Consolidated Statement of Changes in Stockholders’ Equity

(in thousands)

Shares Amount Shares Amount Shares Amount

Foreign currency translation adjustments — — — — — — — — (729) (504) (1,233)

Stock-based compensation — — — — — — 21,679 — — — 21,679

Tax distribution — — — — — — — — — (82) (82)

The accompanying notes are an integral part of these consolidated financial statements.

F-10

Table of Contents

Amneal Pharmaceuticals, Inc.

Consolidated Statements of Cash Flows

(in thousands)

Years Ended December 31,

Cash flows from operating activities:

Gain from reduction of tax receivable agreement liability — — (192,884)

Amortization of Levothyroxine Transition Agreement asset — — 36,393

Gain on sale of international businesses, net — (123) (7,258)

Non-cash restructuring and asset-related (benefit) charges — (536) 12,459

Deferred tax provision — — 371,716

Change in fair value of contingent consideration 200 — —

Insurance recoveries for property and equipment losses (5,000) — —

Non-cash property and equipment losses 5,152 — —

Changes in assets and liabilities:

Prepaid expenses, other current assets and other assets (21,981) 33,312 38,870

Accounts payable, accrued expenses and other liabilities (43,932) 307 (10,257)

Cash flows from investing activities:

Acquisition of product rights and licenses (1,700) (4,350) (50,250)

Proceeds from sale of international businesses, net of cash sold — — 34,834

Cash flows from financing activities:

Payments of deferred financing costs and debt extinguishment costs — (4,102) —

Proceeds from issuance of debt — 180,000 —

Proceeds from exercise of stock options 853 321 1,400

Payments of principal on financing lease - related party (93) (1,079) (2,270)

Repayment of related party notes (1,000) — —

Effect of foreign exchange rate on cash 102 1,037 (2,249)

Supplemental disclosure of cash flow information:

Supplemental disclosure of non-cash investing and financing activity:

Notes payable for acquisitions - related party $ 14,162 $ 36,033 $ —

Deferred consideration for acquisition - related party $ 30,099 $ — $ —

Contingent consideration for acquisition - related party $ 5,700 $ — $ —

Payable for acquisition of product rights and licenses $ 300 $ — $ —

The accompanying notes are an integral part of these consolidated financial statements.

F-11

Table of Contents

Amneal Pharmaceuticals, Inc.

Notes to Consolidated Financial Statements

1. Nature of Operations

Amneal Pharmaceuticals, Inc. (the “Company”) is a pharmaceutical company specializing in developing, manufacturing, marketing and distributing high-value generic and branded specialty pharmaceutical products across a broad array of dosage forms and therapeutic areas. The Company operates principally in the United States, India, and Ireland, and sells to wholesalers, distributors, hospitals, chain pharmacies and individual pharmacies, either directly or indirectly. The Company is a holding company, whose principal assets are common units (“Amneal Common Units”) of Amneal Pharmaceuticals, LLC (“Amneal”).

The group, together with their affiliates and certain assignees, who owned Amneal when it was a private company (the “Members” or the “Amneal Group”) held 50.4% of Amneal Common Units and the Company held the remaining 49.6% as of December 31, 2021.

In 2018, Amneal completed the acquisition of Impax Laboratories, Inc. (“Impax”), a generic and specialty pharmaceutical company.

2. Summary of Significant Accounting Policies

Accounting Principles

The financial statements and accompanying notes are prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). All intercompany accounts and transactions have been eliminated.

Principles of Consolidation

Although the Company has a minority economic interest in Amneal, it is Amneal’s sole managing member, having the sole voting power to make all of Amneal’s business decisions and controls its management. Therefore, the Company consolidates the financial statements of Amneal and its subsidiaries. The Company records non-controlling interests for the portion of Amneal’s economic interests that it does not hold.

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires the Company's management to make estimates and assumptions that affect the reported financial position at the date of the financial statements and the reported results of operations during the reporting period. Such estimates and assumptions affect the reported amounts of assets, liabilities, revenues and expenses, and disclosure of contingent assets and liabilities in the consolidated financial statements and accompanying notes. The following are some, but not all, of such estimates: the determination of chargebacks, sales returns, rebates, billbacks, valuation of intangible and other assets acquired in business combinations, allowances for accounts receivable, accrued liabilities, contingent liabilities, initial and subsequent valuation of contingent consideration recognized in business combinations, stock-based compensation, valuation of inventory balances, the determination of useful lives for product rights and the assessment of expected cash flows used in evaluating goodwill and other long-lived assets for impairment. Actual results could differ from those estimates.

Revenue Recognition

When assessing its revenue recognition, the Company performs the following five steps: (i) identify the contract with a customer; (ii) identify the performance obligations in the contract; (iii) determine the transaction price; (iv) allocate the transaction price to the performance obligations in the contract; and (v) recognize revenue when (or as) the entity satisfies the performance obligation. The Company recognizes revenue when it transfers control of its products to customers, in an amount that reflects the consideration to which the Company expects to be entitled to receive in exchange for those products. For further details on the Company’s revenue recognition policies, refer to Note 4. Revenue Recognition.

Stock-Based Compensation

The Company’s stock-based compensation consists of stock options, restricted stock units ("RSUs") and market performance-based restricted stock units (“MPRSUs”) awarded to employees and non-employee directors. Stock options are measured at their fair value on the grant date or date of modification, as applicable. RSUs, including MPRSUs, are measured at the stock

F-12

Table of Contents

price on the grant date or date of modification, as applicable. The Company recognizes compensation expense on a straight-line basis over the requisite service and/or performance period, as applicable. Forfeitures of awards are accounted for as a reduction in stock-based compensation expense in the period such awards are forfeited. The Company's policy is to issue new shares upon option exercises and the vesting of RSUs and MPRSUs.

Contingent consideration

Foreign Currencies

The Company has operations in the U.S., India, Ireland, and other foreign jurisdictions. Generally, the Company’s foreign operating subsidiaries’ functional currency is the local currency. The results of its non-U.S. dollar based operations are translated to U.S. dollars at the average exchange rates during the period. Assets and liabilities are translated at the rate of exchange prevailing on the balance sheet date. Translation adjustments are included in accumulated other comprehensive loss and non-controlling interests in the consolidated balance sheets and are included in comprehensive income (loss). Transaction gains and losses are included in net income (loss) in the Company’s consolidated statements of operations as a component of foreign exchange (loss) gain, net. Such foreign currency transaction gains and losses include fluctuations related to long term intercompany loans that are payable in the foreseeable future. Translation gains and losses on intercompany balances of a long-term investment nature are included in foreign currency translation adjustments in accumulated other comprehensive income (loss) and non-controlling interests, and comprehensive income (loss).

Business Combinations

Business combinations are accounted for using the acquisition method of accounting. Under the acquisition method, the acquiring entity in a business combination records the assets acquired and liabilities assumed at the date of acquisition at their fair values. Any excess of the purchase price over the fair value of net assets and other identifiable intangible assets acquired is recorded as goodwill. Acquisition-related costs, primarily professional fees, are expensed as incurred.

Cash and Cash Equivalents

Cash and cash equivalents consist of cash on deposit and highly liquid investments with original maturities of three months or less. A portion of the Company’s cash flows are derived outside the U.S. As a result, the Company is subject to market risk associated with changes in foreign exchange rates. The Company maintains cash balances at both U.S.-based and international-based commercial banks. At various times during the year, cash balances in the U.S. may exceed amounts that are insured by the Federal Deposit Insurance Corporation.

Restricted Cash

At December 31, 2021 and 2020, respectively, the Company had restricted cash balances of $9 million and $6 million in its bank accounts primarily related to the purchase of certain land and equipment in India.

Accounts Receivable and Allowance for Credit Losses

Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The Company limits its credit risk with respect to accounts receivable by performing credit evaluations when deemed necessary. The Company does not require collateral to secure amounts owed to it by its customers.

Trade accounts receivable are stated at their net realizable value. The allowance for credit losses reflects the best estimate of expected credit losses of the accounts receivable portfolio determined on the basis of historical experience, current information, and forecasts of future economic conditions. The Company determines its allowance methodology by pooling receivable

F-13

Table of Contents

balances at the customer level. The Company consider various factors, including its previous loss history, individual credit risk associated to each customer, and the current and future condition of the general economy. These credit risk factors are monitored on a quarterly basis and updated as necessary. To the extent that any individual debtor is identified whose credit quality has deteriorated, the Company establishes allowances based on the individual risk characteristics of such customer. The Company makes concerted efforts to collect all outstanding balances due from customers; however, account balances are charged off against the allowance when management believes it is probable the receivable will not be recovered. The Company does not have any off-balance-sheet credit exposure related to customers.

Chargebacks Received from Manufacturers

When a sale occurs on a contracted item, the difference between the cost the Company pays to the manufacturer of that item and the contract price that the end customer has with the manufacturer is rebated to the Company by the manufacturer as a chargeback. Chargebacks are recorded as a reduction to cost of sales and either a reduction in the amount due to the manufacturer (if there is a right of offset) or as a receivable from the manufacturer.

Inventories

Inventories consist of finished goods held for sale, raw materials, and work in process. Inventories are stated at net realizable value, with cost determined using the first-in, first-out method. Adjustments for excess and obsolete inventories are established based upon historical experience and management’s assessment of current product demand. These assessments include inventory obsolescence based on its expiration date, damaged or rejected product, and slow-moving products.

Property, Plant, and Equipment

Property, plant, and equipment are stated at historical cost less accumulated depreciation. Depreciation expense is computed primarily using the straight-line method over the estimated useful lives of the assets, which are as follows:

Asset Classification Estimated Useful Life

Buildings 30 years

Computer equipment 5 years

Furniture and fixtures 7 years

Leasehold improvements Shorter of asset's useful life or remaining life of lease

Machinery and equipment 5 - 10 years

Vehicles 5 years

Upon retirement or disposal, the cost of the asset disposed and the accumulated depreciation are removed from the accounts, and any gain or loss is reflected as part of operating income (loss) in the period of disposal. Expenditures that significantly increase value or extend useful lives of property, plant, and equipment are capitalized, whereas those for normal maintenance and repairs are expensed. The Company capitalizes interest on borrowings during the construction period of major capital projects as part of the related asset and amortizes the capitalized interest into earnings over the related asset’s remaining useful life.

Leases

All significant lease arrangements are recognized as right-of-use (“ROU”) assets and lease liabilities at lease commencement. ROU assets represent the Company's right to use an underlying asset for the lease term, and lease liabilities represent its obligation to make lease payments arising from the lease. ROU assets and liabilities are recognized at the commencement date based on the present value of the future lease payments using the Company's incremental borrowing rate, which is assessed quarterly.

Operating lease expense is recognized on a straight-line basis over the lease term. At each balance sheet date, operating and financing lease liabilities continue to represent the present value of the future payments. Financing lease ROU assets are expensed using the straight-line method, unless another basis is more representative of the pattern of economic benefit, to lease expense. Interest on financing lease liabilities is recognized in interest expense.

Leases with an initial term of 12 months or less (short-term leases) are not recognized in the balance sheet and the related lease payments are recognized as incurred over the lease term. The Company separates lease and non-lease components. A portion of

F-14

Table of Contents

the Company's real estate leases are subject to periodic changes in the Consumer Price Index ("CPI"). The changes to the CPI are treated as variable lease payments and recognized in the period in which the obligation for those payments was incurred.

For further details regarding the Company's leases, refer to Note 12. Leases.

In-Process Research and Development

The fair value of in-process research and development (“IPR&D”) acquired in a business combination is determined based on the present value of each research project’s projected cash flows using an income approach. Revenues are estimated based on relevant market size and growth factors, expected industry trends, individual project life cycles and the life of each research project’s underlying marketability. In determining the fair value of each research project, expected cash flows are adjusted for certain risks of completion, including technical and regulatory risk.

The value attributable to IPR&D projects at the time of acquisition is capitalized as an indefinite-lived intangible asset and tested for impairment until the project is completed or abandoned. Upon completion of the project, the indefinite-lived intangible asset is then accounted for as a finite-lived intangible asset and amortized over the estimated useful life of the asset based on the pattern in which the economic benefits are expected to be consumed or otherwise used up or, if that pattern is not readily determinable, on a straight-line basis. If the project is abandoned, the indefinite-lived intangible asset is charged to expense.

Intangible assets with indefinite lives, including IPR&D, are tested for impairment if impairment indicators arise and, at a minimum, annually. However, an entity is permitted to first assess qualitative factors to determine if a quantitative impairment test is necessary. Further testing is only required if the entity determines, based on the qualitative assessment, that it is more likely than not that an indefinite-lived intangible asset’s fair value is less than its carrying amount. Otherwise, no further impairment testing is required. The indefinite-lived intangible asset impairment test consists of a one-step analysis that compares the fair value of the intangible asset with its carrying amount. If the carrying amount of an intangible asset exceeds its fair value, an impairment loss is recognized in an amount equal to that excess. The Company considers many factors in evaluating whether the value of its intangible assets with indefinite lives may not be recoverable, including, but not limited to, expected growth rates, the cost of equity and debt capital, general economic conditions, the Company's outlook and market performance of the Company's industry and recent and forecasted financial performance.

Goodwill

Goodwill, which represents the excess of purchase price over the fair value of net assets acquired, is carried at cost. Goodwill is not amortized; rather, it is subject to a periodic assessment for impairment by applying a fair value based test. The Company reviews goodwill for possible impairment annually during the fourth quarter, or whenever events or circumstances indicate that the carrying amount may not be recoverable.

Assumptions and estimates used in the evaluation of impairment may affect the carrying value of long-lived assets, which could result in impairment charges in future periods. Such assumptions include projections of future cash flows and the current fair value of the asset.

Amortization of Intangible Assets with Finite Lives

Intangible assets, other than indefinite-lived intangible assets, are amortized over the estimated useful life of the asset based on the pattern in which the economic benefits are expected to be consumed or otherwise used up or, if that pattern is not readily determinable, on a straight-line basis. The useful life is the period over which the assets are expected to contribute directly or

F-15

Table of Contents

indirectly to future cash flows. Intangible assets are not written-off in the period of acquisition unless they become impaired during that period.

The Company regularly evaluates the remaining useful life of each intangible asset that is being amortized to determine whether events and circumstances warrant a revision to the remaining period of amortization. If the estimate of the intangible asset’s remaining useful life is changed, the remaining carrying amount of the intangible asset is amortized prospectively over that revised remaining useful life. See Note 15. Goodwill and Other Intangible Assets, for further discussion of the Company's intangible assets.

Impairment of Long-Lived Assets (Including Intangible Assets with Finite Lives)

The Company reviews its long-lived assets, including intangible assets with finite lives, for recoverability whenever events or changes in circumstances indicate that the carrying amount of the assets may not be fully recoverable. The Company evaluates assets for potential impairment by comparing estimated future undiscounted net cash flows to the carrying amount of the asset. If the carrying amount of the assets exceeds the estimated future undiscounted cash flows, impairment is measured based on the difference between the carrying amount of the assets and fair value which is generally an expected present value cash flow technique. Management’s policy in determining whether an impairment indicator exists comprises measurable operating performance criteria as well as other qualitative measures. See Note 15. Goodwill and Other Intangible Assets, for further discussion of the Company's assessment of intangible asset impairment.

Financial Instruments

The Company minimizes its risks from interest fluctuations through its normal operating and financing activities and, when deemed appropriate through the use of derivative financial instruments. Derivative financial instruments are used to manage risk and are not used for trading or other speculative purposes. The Company does not use leveraged derivative financial instruments. Derivative financial instruments that qualify for hedge accounting must be designated and effective as a hedge of the identified risk exposure at the inception of the contract. Accordingly, changes in fair value of the derivative contract must be highly correlated with changes in fair value of the underlying hedged item at inception of the hedge and over the life of the hedge contract.

All derivatives are recorded on the balance sheet as assets or liabilities and measured at fair value. For derivatives designated as cash flow hedges, the effective portion of the changes in fair value of the derivatives are recorded in accumulated other comprehensive loss, net of income taxes and subsequently amortized as an adjustment to interest expense over the period during which the hedged forecasted transaction affects earnings, which is when the Company recognizes interest expense on the hedged cash flows. Cash flows of such derivative financial instruments are classified consistent with the underlying hedged item.

Highly effective hedging relationships that use interest rate swaps as the hedging instrument and that meet criteria under ASC 815, Derivatives and Hedging, may qualify for the “short-cut method” of assessing effectiveness. The short-cut method allows the Company to make the assumption of no ineffectiveness, which means that the change in fair value of the hedged item can be assumed to be equal to the change in fair value of the derivative. Unless critical terms change, no further evaluation of effectiveness is performed for these hedging relationships unless a critical term is changed.

For a hedging relationship that does not qualify for the short-cut method, the Company measures its effectiveness using the “hypothetical derivative method”, in which the change in fair value of the hedged item must be measured separately from the change in fair value of the derivative. At inception and quarterly thereafter, the Company formally assesses whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in the fair value or cash flows of the hedged item. The Company compares the change in the fair value of the actual interest rate derivative to the change in the fair value of a hypothetical interest rate derivative with critical terms that match the hedged interest rate payments. After the initial quantitative assessment, this analysis is performed on a qualitative basis and, if it is determined that the hedging relationship was and continues to be highly effective, no further analysis is required.

All components of each derivative financial instrument's gain or loss are included in the assessment of hedge effectiveness. If it is determined that a derivative ceases to be a highly effective hedge, the Company discontinues hedge accounting and any deferred gains or losses related to a discontinued cash flow hedge shall continue to be reported in accumulated other comprehensive income (loss) net of income taxes, unless it is probable that the forecasted transaction will not occur. If it is probable that the forecasted transaction will not occur by the originally specified time period, the Company discontinues hedge accounting, and any deferred gains or losses reported in accumulated other comprehensive income (loss) are classified into earnings immediately.

F-16

Table of Contents

The Company is subject to credit risk as a result of nonperformance by counterparties to the derivative agreements. Upon inception and quarterly thereafter, the Company makes judgments on each counterparty’s creditworthiness for nonperformance by counterparties.

Income Taxes

The Company accounts for income taxes in accordance with ASC 740, Accounting for Income Taxes, which requires the recognition of tax benefits or expenses on temporary differences between the financial reporting and tax bases of its assets and liabilities by applying the enacted tax rates in effect for the year in which the differences are expected to reverse. Such net tax effects on temporary differences are reflected on the Company’s consolidated balance sheets as deferred tax assets and liabilities. Deferred tax assets are reduced by a valuation allowance when the Company believes that it is more-likely-than-not that some portion or all of the deferred tax assets will not be realized.

ASC 740-10 prescribes a two-step approach for the recognition and measurement of tax benefits associated with the positions taken or expected to be taken in a tax return that affect amounts reported in the financial statements. The Company has reviewed and will continue to review the conclusions reached regarding uncertain tax positions, which may be subject to review and adjustment at a later date based on ongoing analyses of tax laws, regulations and interpretations thereof. To the extent that the Company’s assessment of the conclusions reached regarding uncertain tax positions changes as a result of the evaluation of new information, such change in estimate will be recorded in the period in which such determination is made. The Company reports income tax-related interest and penalties relating to uncertain tax positions, if applicable, as a component of income tax expense.

Comprehensive Income (Loss)

Comprehensive income (loss) includes net income (loss) and all changes in stockholders’ equity (except those arising from transactions with stockholders) including foreign currency translation adjustments resulting from the consolidation of foreign subsidiaries’ financial statements and unrealized gains on cash flows hedges, net of income taxes.

Research and Development

Research and development ("R&D") activities are expensed as incurred. R&D expenses primarily consist of direct and allocated expenses incurred with the process of formulation, clinical research, and validation associated with new product development. Upfront and milestone payments made to third parties in connection with R&D collaborations are expensed as incurred up to the point of regulatory approval or when there is no alternative future use.

Intellectual Property Legal Development Expenses

The Company expenses external intellectual property legal development expenses as incurred. These costs relate to legal challenges of innovator’s patents for invalidity or non-infringement, which are customary in the generic pharmaceutical industry, and are incurred predominately during development of a product and prior to regulatory approval. Associated costs include, but are not limited to, formulation assessments, patent challenge opinions and strategy, and litigation expenses to defend the intellectual property supporting the Company's regulatory filings.

Shipping Costs

The Company records the costs of shipping product to its customers as a component of selling, general, and administrative expenses as incurred. Shipping costs were $18 million, $17 million and $15 million for the years ended December 31, 2021, 2020 and 2019, respectively.

Recently Issued Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting, which provides elective amendments for entities that have contracts, hedging relationships and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform. These amendments are effective immediately and may be applied prospectively to contract modifications made and hedging relationships entered into or evaluated on or before December 31, 2022. In January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848), to expand and clarify the scope of Topic 848 to include derivative instruments on discounting transactions. The

F-17

Table of Contents

amendments in this ASU are effective in the same timeframe as ASU 2020-04. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements.

Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers

In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers, which requires entities to recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606, Revenue from Contracts with Customers. The update will generally result in an entity recognizing contract assets and contract liabilities at amounts consistent with those recorded by the acquiree immediately before the acquisition date rather than at fair value. The new standard is effective on a prospective basis for fiscal years beginning after December 15, 2022, with early adoption permitted. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements.

Government Assistance (Topic 832): Disclosures by Business Entities About Government Assistance

In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832), Disclosures by Business Entities About Government Assistance, which requires entities to provide disclosures on material government assistance transactions for annual reporting periods. The disclosures include information around the nature of the assistance, the related accounting policies used to account for government assistance, the effect of government assistance on the entity’s financial statements, and any significant terms and conditions of the agreements, including commitments and contingencies. The new standard is effective for the Company on January 1, 2022 and only impacts annual financial statement footnote disclosures. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements.

Reclassification

Prior period balances related to (i) financing lease right-of-use assets of $10 million formerly included in other assets, (ii) current portion of financing lease liabilities of $2 million formerly included in accounts payable and accrued expenses, and (iii) long-term lease liabilities of $2 million formerly included in other long-term liabilities as of December 31, 2020 have been reclassified to their respective balance sheet captions to conform to the current period presentation in the consolidated balance sheets.

3. Acquisitions and Divestitures

Acquisitions

Puniska Healthcare Pvt. Ltd.

On November 2, 2021, the Company entered into a definitive agreement to acquire Puniska Healthcare Pvt. Ltd. (“Puniska”), a privately held manufacturer of parenteral and injectable drugs in India, and land in a transaction valued at $93 million (the "Puniska Acquisition"). Upon execution of the agreement, the Company paid $73 million with cash on hand for approximately 74% of the equity interests of Puniska. Upon approval of the transaction by the government of India, the Company will pay with cash on hand an additional $2 million for the remaining 26% of the equity interests of Puniska (included in redeemable non-controlling interests in the Company’s consolidated balance sheet as of December 31, 2021) and $14 million for the satisfaction of a preexisting payable to the sellers (included in related party payables-short term in the Company’s consolidated balance sheet as of December 31, 2021). The Company expects approval from the government of India in the first half of 2022. During December 2021, the Company paid $4 million with cash on hand for land associated with the Puniska Acquisition.

For the year ended December 31, 2021, the Company incurred $1 million in transaction costs associated with the Puniska Acquisition, which were recorded in acquisition, transaction-related and integration expenses.

The Puniska Acquisition, excluding the land acquired in December 2021, was accounted for under the acquisition method of accounting, with Amneal as the accounting acquirer. The preliminary purchase price was calculated as follows (in thousands):

Fair value of consideration transferred $ 87,042

(1)Cash includes the payment made upon execution of the agreement.

(2)Due to the short-term nature of the payable to the sellers, the principal amount approximates fair value.

F-18

Table of Contents

The following is a summary of the preliminary purchase price allocation for the Puniska Acquisition (in thousands):

Fair Values as of November 1, 2021

Trade accounts receivable, net 232

Prepaid expenses and other current assets 4,473

Property, plant and equipment 56,498

Operating lease-right-of-use assets 234

Total assets acquired 91,013

Accounts payable and accrued expenses 1,732

Operating lease liabilities 234

Other long-term liabilities 263

Total liabilities assumed 2,229

Redeemable non-controlling interests 1,742

AMRX US Equity

AMRX · 10-K · period ended 2021-12-31

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Item 8. Financial Statements and Supplementary Data

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Item 9A. Controls and Procedures

Item 9B. Other Information

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

Item 10. Directors, Executive Officers and Corporate Governance

Item 11. Executive Compensation

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Item 13. Certain Relationships and Related Transactions, and Director Independence

Item 14. Principal Accounting Fees and Services

Item 15. Exhibits, Financial Statement Schedules

Item 16. Form 10-K Summary

AMRX US Equity☆

AMRX · 10-K · period ended 2021-12-31

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Item 8. Financial Statements and Supplementary Data

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Item 9A. Controls and Procedures

Item 9B. Other Information

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

Item 10. Directors, Executive Officers and Corporate Governance

Item 11. Executive Compensation

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Item 13. Certain Relationships and Related Transactions, and Director Independence

Item 14. Principal Accounting Fees and Services

Item 15. Exhibits, Financial Statement Schedules

Item 16. Form 10-K Summary

AMRX US Equity