RESTRUCTURING

On an ongoing basis, we review the global economy, the healthcare industry and the markets in which we compete to identify opportunities for efficiencies, enhance commercial capabilities, align our resources and offer our customers better solutions. In order to realize these opportunities, we undertake restructuring-type activities to transform our business.

On May 1, 2013, we announced that our Board of Directors approved a plan to pursue identified Value Creation and Capture ("VCC") opportunities. These include: (i) investment in product line extensions, next generation products and growth platforms; (ii) enhancement of commercial execution capabilities by implementing go-to-market and other strategies to enable global profitable revenue growth; and (iii) transformation of the manufacturing network to best support these commercial strategies while optimizing expense levels. Collectively, these are opportunities to position us for optimal growth and increased competitiveness.

Our manufacturing network transformation plan, part of our larger VCC activities previously discussed, includes (i) discontinuing manufacturing activities at our Braintree, Massachusetts, Ascoli-Piceno, Italy and Bothwell, Scotland facilities, (ii) creating a technology center of excellence for product development in Braintree, Massachusetts, (iii) expanding of our current facility in Tijuana, Mexico, (iv) engaging Sanmina Corporation as a contract manufacturer to produce certain medical equipment, and (v) building a new manufacturing facility in Penang, Malaysia closer to our customers in Asia.

We estimate we will incur approximately $69.0 million in restructuring and restructuring related expense and spend approximately $59.0 million on these initiatives in fiscal 2015. We estimate we will incur an additional $10.0 million to $15.0 million to complete these initiatives through fiscal 2017.

The following summarizes the restructuring costs for the nine months ended December 27, 2014 and December 28, 2013:



	Nine Months Ended December 27, 2014
(In thousands)		Restructuring Accrual Balance at March 29, 2014		Restructuring Costs Incurred		Less Payments			Less Non-Cash Adjustments			Restructuring Accrual Balance at December 27, 2014
Severance and other employee costs		$	22,908	$	15,633	$	(21,785	)	$	—		$	16,756
Other costs		728		12,044		(12,527		)	—			245
Accelerated depreciation		—		1,158		—			(1,158		)	—
Asset write-down		—		295		—			(295		)	—
Total		$	23,636	$	29,130	$	(34,312	)	$	(1,453	)	$	17,001



	Nine Months Ended December 28, 2013
(in thousands)		Restructuring Accrual Balance at March 30, 2013		Restructuring Costs Incurred		Less Payments			Less Non-Cash Adjustments			Restructuring Accrual Balance at December 28, 2013
Severance and other employee costs		$	3,089	$	28,189	$	(9,690	)	$	—		$	21,588
Other costs		173		9,905		(9,566		)	—			512
Accelerated depreciation		—		1,757		—			(1,757		)	—
Asset write-down		—		915		—			(915		)	—
		$	3,262	$	40,766	$	(19,256	)	$	(2,672	)	$	22,100

We deployed significant financial resources for these activities. Many of the costs necessary to complete the VCC initiatives, such as severance and other plant closing costs, qualify as restructuring expenses under ASC 420, Exit or Disposal Cost Obligations. We incurred $29.1 million in severance, asset write-downs and other restructuring charges during the nine months ended December 27, 2014. In addition, we also incurred $22.1 million of costs that do not constitute restructuring under ASC 420, which we refer to as "Transformation Costs". These costs consist primarily of expenditures directly related to our transformation activities including program management, product line transfer teams and related costs, infrastructure related costs, accelerated depreciation and asset disposals.

The table below presents transformation and restructuring costs recorded in cost of goods sold, research and development, selling, general and administrative expenses and interest and other expense in our Consolidated Statements of Income and Comprehensive Income for the periods presented. The majority of expenses recorded as Transformation Costs in the fiscal 2014 relate to the integration of the whole blood acquisition. Transformation Costs in fiscal 2015 are associated with our VCC initiatives.



Transformation costs	Three Months Ended				Nine Months Ended
(in thousands)	December 27, 2014		December 28, 2013		December 27, 2014		December 28, 2013
Transformation and other costs	$	5,892	$	6,306	$	20,877	$	26,389
Accelerated depreciation	351		653		769		1,938
Asset disposal	471		36		471		796
Total	$	6,714	$	6,995	$	22,117	$	29,123



Restructuring costs	Three Months Ended				Nine Months Ended
(in thousands)	December 27, 2014		December 28, 2013		December 27, 2014		December 28, 2013
Severance and other employee costs	$	2,887	$	5,348	$	15,633	$	28,189
Other costs	2,691		4,588		12,044		9,905
Accelerated depreciation	418		569		1,158		1,757
Asset disposal	199		—		295		915
Total	$	6,195	$	10,505	$	29,130	$	40,766

Total restructuring and transformation	$	12,909	$	17,500	$	51,247	$	69,889