Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Jan. 31, 2021 | Jun. 30, 2020 | |
Document and Entity Information | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Document Period End Date | Dec. 31, 2020 | ||
Entity File Number | 1-2189 | ||
Entity Registrant Name | Abbott Laboratories | ||
Entity Tax Identification Number | 36-0698440 | ||
Entity Incorporation, State or Country Code | IL | ||
Entity Address, State or Province | IL | ||
Entity Address, Address Line One | 100 Abbott Park Road | ||
Entity Address, City or Town | Abbott Park | ||
Entity Address, Postal Zip Code | 60064-6400 | ||
City Area Code | 224 | ||
Local Phone Number | 667-6100 | ||
Title of 12(b) Security | Common Shares, Without Par Value | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Common Stock, Shares Outstanding | 1,771,529,358 | ||
Entity Public Float | $ 157,956,823,602 | ||
Entity Central Index Key | 0000001800 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
New York Stock Exchange | |||
Document and Entity Information | |||
Security Exchange Name | NYSE | ||
Trading Symbol | ABT | ||
Chicago Stock Exchange | |||
Document and Entity Information | |||
Security Exchange Name | CHX |
Consolidated Statement of Earni
Consolidated Statement of Earnings - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Consolidated Statement of Earnings | |||
Net sales | $ 34,608 | $ 31,904 | $ 30,578 |
Cost of products sold, excluding amortization of intangible assets | 15,003 | 13,231 | 12,706 |
Amortization of intangible assets | 2,132 | 1,936 | 2,178 |
Research and development | 2,420 | 2,440 | 2,300 |
Selling, general and administrative | 9,696 | 9,765 | 9,744 |
Total Operating Cost and Expenses | 29,251 | 27,372 | 26,928 |
Operating Earnings | 5,357 | 4,532 | 3,650 |
Interest expense | 546 | 670 | 826 |
Interest income | (46) | (94) | (105) |
Net foreign exchange (gain) loss | (8) | 7 | 28 |
Debt extinguishment costs | 63 | 167 | |
Other (income) expense, net | (103) | (191) | (139) |
Earnings from Continuing Operations Before Taxes | 4,968 | 4,077 | 2,873 |
Taxes on Earnings from Continuing Operations | 497 | 390 | 539 |
Earnings from Continuing Operations | 4,471 | 3,687 | 2,334 |
Net Earnings from Discontinued Operations, net of taxes | 24 | 34 | |
Net Earnings | $ 4,495 | $ 3,687 | $ 2,368 |
Basic Earnings Per Common Share -- | |||
Continuing Operations | $ 2.51 | $ 2.07 | $ 1.32 |
Discontinued Operations | 0.01 | 0.02 | |
Net Earnings | 2.52 | 2.07 | 1.34 |
Diluted Earnings Per Common Share -- | |||
Continuing Operations | 2.49 | 2.06 | 1.31 |
Discontinued Operations | 0.01 | 0.02 | |
Net Earnings | $ 2.50 | $ 2.06 | $ 1.33 |
Average Number of Common Shares Outstanding Used for Basic Earnings Per Common Share | 1,773 | 1,768 | 1,758 |
Dilutive Common Stock Options | 13 | 13 | 12 |
Average Number of Common Shares Outstanding Plus Dilutive Common Stock Options | 1,786 | 1,781 | 1,770 |
Outstanding Common Stock Options Having No Dilutive Effect | 9 | 61 |
Consolidated Statement of Compr
Consolidated Statement of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Consolidated Statement of Comprehensive Income | |||
Net Earnings | $ 4,495 | $ 3,687 | $ 2,368 |
Foreign currency translation gain (loss) adjustments | 65 | (12) | (1,460) |
Net actuarial gains (losses) and prior service cost and credits and amortization of net actuarial losses and prior service cost and credits, net of taxes of $(79) in 2020, $(238) in 2019 and $47 in 2018 | (331) | (814) | 132 |
Net (losses) gains on derivative instruments designated as cash flow hedges, net of taxes of $(87) in 2020, $(17) in 2019 and $50 in 2018 | (215) | (53) | 136 |
Other Comprehensive Income (Loss) | (481) | (879) | (1,192) |
Comprehensive Income | 4,014 | 2,808 | 1,176 |
Supplemental Accumulated Other Comprehensive Income (Loss) Information, net of tax as of December 31: | |||
Cumulative foreign currency translation (loss) adjustments | (4,859) | (4,924) | (4,912) |
Net actuarial (losses) and prior service (cost) and credits | (3,871) | (3,540) | (2,726) |
Cumulative (losses) gains on derivative instruments designated as cash flow hedges | (216) | (1) | 52 |
Accumulated other comprehensive income (loss) | $ (8,946) | $ (8,465) | $ (7,586) |
Consolidated Statement of Com_2
Consolidated Statement of Comprehensive Income (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Consolidated Statement of Comprehensive Income | |||
Net actuarial gains (losses) and prior service cost and credits and amortization of net actuarial losses and prior service cost and credits taxes | $ (79) | $ (238) | $ 47 |
Net (losses) gains on derivative instruments designated as cash flow hedges taxes | $ (87) | $ (17) | $ 50 |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash Flow From (Used in) Operating Activities: | |||
Net earnings | $ 4,495 | $ 3,687 | $ 2,368 |
Adjustments to reconcile earnings to net cash from operating activities - | |||
Depreciation | 1,195 | 1,078 | 1,100 |
Amortization of intangible assets | 2,132 | 1,936 | 2,178 |
Share-based compensation | 546 | 519 | 477 |
Amortization of inventory step-up | 32 | ||
Investing and financing losses, net | 425 | 184 | 126 |
Loss on extinguishment of debt | 63 | 167 | |
Trade receivables | (924) | (275) | (190) |
Inventories | (493) | (593) | (514) |
Prepaid expenses and other assets | (627) | (138) | 23 |
Trade accounts payable and other liabilities | 1,766 | 220 | 747 |
Income taxes | (614) | (545) | (214) |
Net Cash From Operating Activities | 7,901 | 6,136 | 6,300 |
Cash Flow From (Used in) Investing Activities: | |||
Acquisitions of property and equipment | (2,177) | (1,638) | (1,394) |
Acquisitions of businesses and technologies, net of cash acquired | (42) | (170) | (54) |
Proceeds from business dispositions | 58 | 48 | 48 |
Purchases of investment securities | (83) | (103) | (131) |
Proceeds from sales of investment securities | 10 | 21 | 73 |
Other | 19 | 27 | 102 |
Net Cash From (Used in) Investing Activities | (2,215) | (1,815) | (1,356) |
Cash Flow From (Used in) Financing Activities: | |||
Proceeds from issuance of (repayments of) short-term debt, net and other | 2 | (26) | |
Proceeds from issuance of long-term debt and debt with maturities over 3 months | 1,281 | 1,842 | 4,009 |
Repayments of long-term debt and debt with maturities over 3 months | (1,333) | (3,441) | (12,433) |
Purchases of common shares | (403) | (718) | (238) |
Proceeds from stock options exercised | 245 | 298 | 271 |
Dividends paid | (2,560) | (2,270) | (1,974) |
Other | (11) | ||
Net Cash From (Used in) Financing Activities | (2,779) | (4,289) | (10,391) |
Effect of exchange rate changes on cash and cash equivalents | 71 | (16) | (116) |
Net Increase (Decrease) in Cash and Cash Equivalents | 2,978 | 16 | (5,563) |
Cash and Cash Equivalents, Beginning of Year | 3,860 | 3,844 | 9,407 |
Cash and Cash Equivalents, End of Year | 6,838 | 3,860 | 3,844 |
Supplemental Cash Flow Information: | |||
Income taxes paid | 970 | 930 | 740 |
Interest paid | $ 549 | $ 677 | $ 845 |
Consolidated Balance Sheet
Consolidated Balance Sheet - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 6,838 | $ 3,860 |
Investments, primarily bank time deposits and U.S. treasury bills | 310 | 280 |
Trade receivables, less allowances of - 2020: $460; 2019: $384 | 6,414 | 5,425 |
Inventories: | ||
Finished products | 3,030 | 2,784 |
Work in process | 712 | 560 |
Materials | 1,270 | 972 |
Total inventories | 5,012 | 4,316 |
Other prepaid expenses and receivables | 1,867 | 1,786 |
Total current assets | 20,441 | 15,667 |
Investments | 821 | 883 |
Property and equipment, at cost: | ||
Land | 538 | 519 |
Buildings | 4,014 | 3,702 |
Equipment | 12,884 | 11,468 |
Construction in progress | 1,357 | 1,110 |
Property and equipment, at cost | 18,793 | 16,799 |
Less: accumulated depreciation and amortization | 9,764 | 8,761 |
Net property and equipment | 9,029 | 8,038 |
Intangible assets, net of amortization | 14,784 | 17,025 |
Goodwill | 23,744 | 23,195 |
Deferred income taxes and other assets | 3,729 | 3,079 |
Total Assets | 72,548 | 67,887 |
Current liabilities: | ||
Short-term borrowings | 213 | 201 |
Trade accounts payable | 3,946 | 3,252 |
Salaries, wages and commissions | 1,416 | 1,237 |
Other accrued liabilities | 5,165 | 4,035 |
Dividends payable | 798 | 635 |
Income taxes payable | 362 | 226 |
Current portion of long-term debt | 7 | 1,277 |
Total current liabilities | 11,907 | 10,863 |
Long-term debt | 18,527 | 16,661 |
Post-employment obligations and other long-term liabilities | 9,111 | 9,062 |
Commitments and Contingencies | ||
Shareholders' Investment: | ||
Preferred shares, one dollar par value Authorized - 1,000,000 shares, none issued | ||
Common shares, without par value Authorized - 2,400,000,000 shares Issued at stated capital amount - Shares: 2020: 1,981,156,896; 2019: 1,976,855,085 | 24,145 | 23,853 |
Common shares held in treasury, at cost - Shares: 2020: 209,926,622; 2019: 214,351,838 | (10,042) | (10,147) |
Earnings employed in the business | 27,627 | 25,847 |
Accumulated other comprehensive income (loss) | (8,946) | (8,465) |
Total Abbott Shareholders' Investment | 32,784 | 31,088 |
Noncontrolling interests in subsidiaries | 219 | 213 |
Total Shareholders' Investment | 33,003 | 31,301 |
Total Liabilities and Shareholders' Investment | $ 72,548 | $ 67,887 |
Consolidated Balance Sheet (Par
Consolidated Balance Sheet (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Consolidated Balance Sheet | ||
Trade receivables, allowances (in dollars) | $ 460 | $ 384 |
Preferred shares, par value (in dollars per share) | $ 1 | $ 1 |
Preferred shares, authorized shares | 1,000,000 | 1,000,000 |
Preferred shares, issued shares | 0 | 0 |
Common shares, authorized shares | 2,400,000,000 | 2,400,000,000 |
Common shares, issued shares | 1,981,156,896 | 1,976,855,085 |
Common shares held in treasury, shares | 209,926,622 | 214,351,838 |
Consolidated Statement of Share
Consolidated Statement of Shareholders' Investment - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Increase (Decrease) in Shareholders' Investment | |||
Beginning of Year | $ 31,301 | ||
Net Earnings | 4,495 | $ 3,687 | $ 2,368 |
Other comprehensive income (loss) | (481) | (879) | (1,192) |
End of Year | 33,003 | 31,301 | |
Common Shares: | |||
Increase (Decrease) in Shareholders' Investment | |||
Beginning of Year | 23,853 | 23,512 | 23,206 |
Issued under incentive stock programs | 181 | 209 | 163 |
Share-based compensation | 548 | 521 | 479 |
Issuance of restricted stock awards | (437) | (389) | (336) |
End of Year | 24,145 | 23,853 | 23,512 |
Common Shares Held in Treasury: | |||
Increase (Decrease) in Shareholders' Investment | |||
Beginning of Year | (10,147) | (9,962) | (10,225) |
Issued under incentive stock programs | 298 | 361 | 408 |
Purchased | (193) | (546) | (145) |
End of Year | (10,042) | (10,147) | (9,962) |
Earnings Employed in the Business: | |||
Increase (Decrease) in Shareholders' Investment | |||
Beginning of Year | 25,847 | 24,560 | 23,978 |
Net Earnings | 4,495 | 3,687 | 2,368 |
Cash dividends declared on common shares | (2,722) | (2,343) | (2,047) |
Effect of common and treasury share transactions | 12 | (57) | (90) |
End of Year | 27,627 | 25,847 | 24,560 |
Earnings Employed in the Business: | Impact of adoption of new accounting standards | |||
Increase (Decrease) in Shareholders' Investment | |||
Beginning of Year | 351 | ||
End of Year | (5) | 351 | |
Accumulated Other Comprehensive Income (Loss): | |||
Increase (Decrease) in Shareholders' Investment | |||
Beginning of Year | (8,465) | (7,586) | (6,062) |
Other comprehensive income (loss) | (481) | (879) | (1,192) |
End of Year | (8,946) | (8,465) | (7,586) |
Accumulated Other Comprehensive Income (Loss): | Impact of adoption of new accounting standards | |||
Increase (Decrease) in Shareholders' Investment | |||
Beginning of Year | (332) | ||
End of Year | (332) | ||
Noncontrolling Interests in Subsidiaries: | |||
Increase (Decrease) in Shareholders' Investment | |||
Beginning of Year | 213 | 198 | 201 |
Noncontrolling Interests' share of income, business combinations, net of distributions and share repurchases | 6 | 15 | (3) |
End of Year | $ 219 | $ 213 | $ 198 |
Consolidated Statement of Sha_2
Consolidated Statement of Shareholders' Investment (Parenthetical) - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Common Shares: | |||
Increase (Decrease) in Shareholders' Investment | |||
Balance at beginning of period (in shares) | 1,976,855,085 | 1,971,189,465 | 1,965,908,188 |
Issued under incentive stock programs (in shares) | 4,301,811 | 5,665,620 | 5,281,277 |
Balance at end of period (in shares) | 1,981,156,896 | 1,976,855,085 | 1,971,189,465 |
Common Shares Held in Treasury: | |||
Increase (Decrease) in Shareholders' Investment | |||
Balance at beginning of period (in shares) | 214,351,838 | 215,570,043 | 222,305,719 |
Issued under incentive stock programs (in shares) | 6,290,757 | 7,796,030 | 8,870,735 |
Purchased (in shares) | 1,865,541 | 6,577,825 | 2,135,059 |
Balance at end of period (in shares) | 209,926,622 | 214,351,838 | 215,570,043 |
Earnings Employed in the Business: | |||
Increase (Decrease) in Shareholders' Investment | |||
Cash dividends declared per common share | $ 1.53 | $ 1.32 | $ 1.16 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2020 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | Note 1 — Summary of Significant Accounting Policies NATURE OF BUSINESS — Abbott’s principal business is the discovery, development, manufacture and sale of a broad line of health care products. BASIS OF CONSOLIDATION — The consolidated financial statements include the accounts of the parent company and subsidiaries, after elimination of intercompany transactions. USE OF ESTIMATES — The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States and necessarily include amounts based on estimates and assumptions by management. Actual results could differ from those amounts. Significant estimates include amounts for sales rebates, income taxes, pension and other post-employment benefits, valuation of intangible assets, litigation, derivative financial instruments, and inventory and accounts receivable exposures. FOREIGN CURRENCY TRANSLATION — The statements of earnings of foreign subsidiaries whose functional currencies are other than the U.S. dollar are translated into U.S. dollars using average exchange rates for the period. The net assets of foreign subsidiaries whose functional currencies are other than the U.S. dollar are translated into U.S. dollars using exchange rates as of the balance sheet date. The U.S. dollar effects that arise from translating the net assets of these subsidiaries at changing rates are recorded in the foreign currency translation adjustment account, which is included in equity as a component of Accumulated other comprehensive income (loss). Transaction gains and losses are recorded on the Net foreign exchange (gain) loss line of the Consolidated Statement of Earnings. REVENUE RECOGNITION — Revenue from product sales is recognized upon the transfer of control, which is generally upon shipment or delivery, depending on the delivery terms set forth in the customer contract. Provisions for discounts, rebates and sales incentives to customers, and returns and other adjustments are provided for in the period the related sales are recorded. Sales incentives to customers are not material. Historical data is readily available and reliable, and is used for estimating the amount of the reduction in gross sales. Revenue from the launch of a new product, from an improved version of an existing product, or for shipments in excess of a customer’s normal requirements are recorded when the conditions noted above are met. In those situations, management records a returns reserve for such revenue, if necessary. In certain of Abbott’s businesses, primarily within diagnostics, Abbott participates in selling arrangements that include multiple performance obligations (e.g., instruments, reagents, procedures, and service agreements). The total transaction price of the contract is allocated to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. Sales of product rights for marketable products are recorded as revenue upon disposition of the rights. INCOME TAXES — Deferred income taxes are provided for the tax effect of differences between the tax bases of assets and liabilities and their reported amounts in the financial statements at the enacted statutory rate to be in effect when the taxes are paid. No additional income taxes have been provided for any remaining undistributed foreign earnings not subject to the transition tax related to the U.S. Tax Cuts and Jobs Act (TCJA), or any additional outside basis differences that exist, as these amounts continue to be indefinitely reinvested in foreign operations. Effective for fiscal years beginning after December 31, 2017, the TCJA subjects taxpayers to tax on global intangible low-taxed income (GILTI) earned by certain foreign subsidiaries. Abbott treats the GILTI tax as a period expense and provides for the tax in the year that the tax is incurred. Interest and penalties on income tax obligations are included in taxes on earnings. EARNINGS PER SHARE — Unvested restricted stock units and awards that contain non-forfeitable rights to dividends are treated as participating securities and are included in the computation of earnings per share under the two-class method. Under the two-class method, net earnings are allocated between common shares and participating securities. Earnings from Continuing Operations allocated to common shares in 2020, 2019 and 2018 were $4.449 billion, $3.666 billion and $2.320 billion, respectively. Net earnings allocated to common shares in 2020, 2019 and 2018 were $4.473 billion, $3.666 billion and $2.353 billion, respectively. Note 1 — Summary of Significant Accounting Policies (Continued) PENSION AND POST-EMPLOYMENT BENEFITS — Abbott accrues for the actuarially determined cost of pension and post-employment benefits over the service attribution periods of the employees. Abbott must develop long-term assumptions, the most significant of which are the health care cost trend rates, discount rates and the expected return on plan assets. Differences between the expected long-term return on plan assets and the actual return are amortized over a five-year period. Actuarial losses and gains are amortized over the remaining service attribution periods of the employees under the corridor method. FAIR VALUE MEASUREMENTS — For assets and liabilities that are measured using quoted prices in active markets, total fair value is the published market price per unit multiplied by the number of units held without consideration of transaction costs. Assets and liabilities that are measured using significant other observable inputs are valued by reference to similar assets or liabilities, adjusted for contract restrictions and other terms specific to that asset or liability. For these items, a significant portion of fair value is derived by reference to quoted prices of similar assets or liabilities in active markets. For all remaining assets and liabilities, fair value is derived using a fair value model, such as a discounted cash flow model or Black-Scholes model. Purchased intangible assets are recorded at fair value. The fair value of significant purchased intangible assets is based on independent appraisals. Abbott uses a discounted cash flow model to value intangible assets. The discounted cash flow model requires assumptions about the timing and amount of future net cash flows, risk, the cost of capital, terminal values and market participants. Intangible assets are reviewed for impairment on a quarterly basis. Goodwill and indefinite-lived intangible assets are tested for impairment at least annually. SHARE-BASED COMPENSATION — The fair value of stock options and restricted stock awards and units are amortized over their requisite service period, which could be shorter than the vesting period if an employee is retirement eligible, with a charge to compensation expense. LITIGATION — Abbott accounts for litigation losses in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) No. 450, “Contingencies.” Under ASC No. 450, loss contingency provisions are recorded for probable losses at management’s best estimate of a loss, or when a best estimate cannot be made, a minimum loss contingency amount is recorded. Legal fees are recorded as incurred. CASH, CASH EQUIVALENTS AND INVESTMENTS — Cash equivalents consist of bank time deposits, U.S. government securities money market funds and U.S. treasury bills with original maturities of three months or less. Abbott holds certain investments with a carrying value of $277 million that are accounted for under the equity method of accounting. Investments held in a rabbi trust and investments in publicly traded equity securities are recorded at fair value and changes in fair value are recorded in earnings. Investments in equity securities that are not traded on public stock exchanges are recorded at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. Investments in debt securities are classified as held-to-maturity, as management has both the intent and ability to hold these securities to maturity, and are reported at cost, net of any unamortized premium or discount. Income relating to these securities is reported as interest income. TRADE RECEIVABLE VALUATIONS — Accounts receivable are stated at the net amount expected to be collected. The allowance for doubtful accounts reflects the current estimate of credit losses expected to be incurred over the life of the accounts receivable. Abbott considers various factors in establishing, monitoring, and adjusting its allowance for doubtful accounts, including the aging of the accounts and aging trends, the historical level of charge-offs, and specific exposures related to particular customers. Abbott also monitors other risk factors and forward-looking information, such as country risk, when determining credit limits for customers and establishing adequate allowances. Accounts receivable are charged off after all reasonable means to collect the full amount (including litigation, where appropriate) have been exhausted. INVENTORIES — Inventories are stated at the lower of cost (first-in, first-out basis) or net realizable value. Cost includes material and conversion costs. Note 1 — Summary of Significant Accounting Policies (Continued) PROPERTY AND EQUIPMENT — Depreciation and amortization are provided on a straight-line basis over the estimated useful lives of the assets. The following table shows estimated useful lives of property and equipment: Classification Estimated Useful Lives Buildings 10 to 50 years Equipment 2 to 20 years PRODUCT LIABILITY — Abbott accrues for product liability claims when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated based on existing information. The liabilities are adjusted quarterly as additional information becomes available. Product liability losses are self-insured. RESEARCH AND DEVELOPMENT COSTS — Internal research and development costs are expensed as incurred. Clinical trial costs incurred by third parties are expensed as the contracted work is performed. Where contingent milestone payments are due to third parties under research and development arrangements, the milestone payment obligations are expensed when the milestone results are achieved. ACQUIRED IN-PROCESS AND COLLABORATIONS RESEARCH AND DEVELOPMENT (IPR&D) — The initial costs of rights to IPR&D projects obtained in an asset acquisition are expensed as IPR&D unless the project has an alternative future use. These costs include initial payments incurred prior to regulatory approval in connection with research and development collaboration agreements that provide rights to develop, manufacture, market and/or sell pharmaceutical or medical device products. The fair value of IPR&D projects acquired in a business combination are capitalized and accounted for as indefinite-lived intangible assets until completed and are then amortized over the remaining useful life. Collaborations are not significant. CONCENTRATION OF RISK AND GUARANTEES — Due to the nature of its operations, Abbott is not subject to significant concentration risks relating to customers, products or geographic locations. Product warranties are not significant. Abbott has no material exposures to off-balance sheet arrangements; no special purpose entities; nor activities that include non-exchange-traded contracts accounted for at fair value. Abbott periodically acquires a business or product rights in which Abbott agrees to pay contingent consideration based on attaining certain thresholds or based on the occurrence of certain events. |
New Accounting Standards
New Accounting Standards | 12 Months Ended |
Dec. 31, 2020 | |
New Accounting Standards | |
New Accounting Standards | Note 2 – New Accounting Standards Recently Adopted Accounting Standards In February 2018, the FASB issued Accounting Standards Update (ASU) 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income Note 2 — New Accounting Standards (Continued) In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses Recent Accounting Standards Not Yet Adopted In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2020 | |
Revenue | |
Revenue | Note 3 — Revenue Abbott’s revenues are derived primarily from the sale of a broad line of health care products under short-term receivable arrangements. Patent protection and licenses, technological and performance features, and inclusion of Abbott’s products under a contract most impact which products are sold; price controls, competition and rebates most impact the net selling prices of products; and foreign currency translation impacts the measurement of net sales and costs. Abbott's products are generally sold directly to retailers, wholesalers, distributors, hospitals, health care facilities, laboratories, physicians' offices and government agencies throughout the world. Abbott has four reportable segments: Established Pharmaceutical Products, Diagnostic Products, Nutritional Products, and Medical Devices. Note 3 — Revenue (Continued) The following tables provide detail by sales category: 2020 2019 2018 (in millions) U.S. Int’l Total U.S. Int’l Total U.S. Int’l Total Established Pharmaceutical Products — Key Emerging Markets $ — $ 3,209 $ 3,209 $ — $ 3,392 $ 3,392 $ — $ 3,363 $ 3,363 Other — 1,094 1,094 — 1,094 1,094 — 1,059 1,059 Total — 4,303 4,303 — 4,486 4,486 — 4,422 4,422 Nutritionals — Pediatric Nutritionals 1,987 2,140 4,127 1,879 2,282 4,161 1,843 2,254 4,097 Adult Nutritionals 1,292 2,228 3,520 1,231 2,017 3,248 1,232 1,900 3,132 Total 3,279 4,368 7,647 3,110 4,299 7,409 3,075 4,154 7,229 Diagnostics — Core Laboratory 1,166 3,309 4,475 1,086 3,570 4,656 985 3,401 4,386 Molecular 621 817 1,438 149 293 442 152 332 484 Point of Care 369 147 516 438 123 561 432 121 553 Rapid Diagnostics 2,618 1,758 4,376 1,214 840 2,054 1,148 924 2,072 Total 4,774 6,031 10,805 2,887 4,826 7,713 2,717 4,778 7,495 Medical Devices — Rhythm Management 903 1,011 1,914 1,057 1,087 2,144 1,105 1,093 2,198 Electrophysiology 660 918 1,578 742 979 1,721 678 883 1,561 Heart Failure 547 193 740 574 195 769 467 179 646 Vascular 853 1,486 2,339 1,047 1,803 2,850 1,126 1,803 2,929 Structural Heart 540 707 1,247 616 784 1,400 488 751 1,239 Neuromodulation 564 138 702 660 171 831 690 174 864 Diabetes Care 864 2,403 3,267 678 1,846 2,524 457 1,476 1,933 Total 4,931 6,856 11,787 5,374 6,865 12,239 5,011 6,359 11,370 Other 38 28 66 27 30 57 36 26 62 Total $ 13,022 $ 21,586 $ 34,608 $ 11,398 $ 20,506 $ 31,904 $ 10,839 $ 19,739 $ 30,578 Abbott recognizes revenue from product sales upon the transfer of control, which is generally upon shipment or delivery, depending on the delivery terms set forth in the customer contract. For maintenance agreements that provide service beyond Abbott’s standard warranty and other service agreements, revenue is recognized ratably over the contract term. A time-based measure of progress appropriately reflects the transfer of services to the customer. Payment terms between Abbott and its customers vary by the type of customer, country of sale, and the products or services offered. The term between invoicing and the payment due date is not significant. Note 3 — Revenue (Continued) Management exercises judgment in estimating variable consideration. Provisions for discounts, rebates and sales incentives to customers, and returns and other adjustments are provided for in the period the related sales are recorded. Sales incentives to customers are not material. Historical data is readily available and reliable, and is used for estimating the amount of the reduction in gross sales. Abbott provides rebates to government agencies, wholesalers, group purchasing organizations and other private entities. Rebate amounts are usually based upon the volume of purchases using contractual or statutory prices for a product. Factors used in the rebate calculations include the identification of which products have been sold subject to a rebate, which customer or government agency price terms apply, and the estimated lag time between sale and payment of a rebate. Using historical trends, adjusted for current changes, Abbott estimates the amount of the rebate that will be paid, and records the liability as a reduction of gross sales when Abbott records its sale of the product. Settlement of the rebate generally occurs from one Other allowances charged against gross sales include cash discounts and returns, which are not significant. Cash discounts are known within 15 to 30 days of sale, and therefore can be reliably estimated. Returns can be reliably estimated because Abbott's historical returns are low, and because sales return terms and other sales terms have remained relatively unchanged for several periods. Product warranties are also not significant. Abbott also applies judgment in determining the timing of revenue recognition related to contracts that include multiple performance obligations. The total transaction price of the contract is allocated to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. For goods or services for which observable standalone selling prices are not available, Abbott uses an expected cost plus a margin approach to estimate the standalone selling price of each performance obligation. Remaining Performance Obligations As of December 31, 2020, the estimated revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) was approximately $3.8 billion in the Diagnostic Products segment and approximately $430 million in the Medical Devices segment. Abbott expects to recognize revenue on approximately 60 percent of these remaining performance obligations over the next 24 months, approximately 17 percent over the subsequent 12 months and the remainder thereafter. These performance obligations primarily reflect the future sale of reagents/consumables in contracts with minimum purchase obligations, extended warranty or service obligations related to previously sold equipment, and remote monitoring services related to previously implanted devices. Abbott has applied the practical expedient described in ASC 606-10-50 -14 one year Assets Recognized for Costs to Obtain a Contract with a Customer Abbott has applied the practical expedient in ASC 340-40-25-4 and records as an expense the incremental costs of obtaining contracts with customers in the period of occurrence when the amortization period of the asset that Abbott otherwise would have recognized is one year or less. Upfront commission fees paid to sales personnel as a result of obtaining or renewing contracts with customers are incremental to obtaining the contract. Abbott capitalizes these amounts as contract costs. Capitalized commission fees are amortized based on the contract duration to which the assets relate which ranges from two Note 3 — Revenue (Continued) Additionally, the cost of transmitters provided to customers that use Abbott’s remote monitoring service with respect to certain medical devices are capitalized as contract costs. Capitalized transmitter costs are amortized based on the timing of the transfer of services to which the assets relate, which typically ranges from eight Other Contract Assets and Liabilities Abbott discloses Trade receivables separately in the Consolidated Balance Sheet at the net amount expected to be collected. Contract assets primarily relate to Abbott’s conditional right to consideration for work completed but not billed at the reporting date. Contract assets at the beginning and end of the period, as well as the changes in the balance, were not significant. Contract liabilities primarily relate to payments received from customers in advance of performance under the contract. Abbott’s contract liabilities arise primarily in the Medical Devices reportable segment when payment is received upfront for various multi-period extended service arrangements. Changes in the contract liabilities during the period are as follows: (in millions) Contract Liabilities Balance at December 31, 2018 $ 259 Unearned revenue from cash received during the period 411 Revenue recognized related to contract liability balance (376) Balance at December 31, 2019 294 Unearned revenue from cash received during the period 505 Revenue recognized related to contract liability balance (394) Balance at December 31, 2020 $ 405 |
Discontinued Operations and Bus
Discontinued Operations and Business Dispositions | 12 Months Ended |
Dec. 31, 2020 | |
Discontinued Operations and Business Dispositions | |
Discontinued Operations and Business Dispositions | Note 4 — Discontinued Operations and Business Dispositions The net earnings of discontinued operations include income tax benefits of $24 million in 2020 and $39 million in 2018. The 2020 tax benefits primarily relate to the resolution of various tax positions related to Abbott’s developed markets branded generic pharmaceuticals business which was sold to Mylan Inc. (Mylan) in 2015. The tax positions relate to years prior to the sale to Mylan. The 2018 tax benefits primarily relate to the resolution of various tax positions related to the operations of AbbVie Inc. (AbbVie) for years prior to the separation. Abbott completed the separation of AbbVie, which was formed to hold Abbott’s research-based proprietary pharmaceuticals business, in January 2013. Abbott retained all liabilities for all U.S. federal and foreign income taxes on income prior to the separation. |
Supplemental Financial Informat
Supplemental Financial Information | 12 Months Ended |
Dec. 31, 2020 | |
Supplemental Financial Information | |
Supplemental Financial Information | Note 5 — Supplemental Financial Information Other (income) expense, net, for 2020, 2019 and 2018 includes approximately $205 million, $225 million and $160 million of income, respectively, related to the non-service cost components of the net periodic benefit costs associated with the pension and post-retirement medical plans. Note 5 — Supplemental Financial Information (Continued) The following summarizes the activity for 2020 related to the allowance for doubtful accounts as of December 31, 2020: (in millions) Allowance for Doubtful Accounts Balance at December 31, 2019 $ 228 Impact of adopting ASU 2016-13 7 Provisions/charges to income 88 Amounts charged off and other deductions (35) Balance at December 31, 2020 $ 288 The allowance for doubtful accounts reflects the current estimate of credit losses expected to be incurred over the life of the accounts receivable. Abbott considers various factors in establishing, monitoring, and adjusting its allowance for doubtful accounts, including the aging of the accounts and aging trends, the historical level of charge-offs, and specific exposures related to particular customers. Abbott also monitors other risk factors and forward-looking information, such as country risk, when determining credit limits for customers and establishing adequate allowances. The detail of various balance sheet components is as follows: December 31, December 31, (in millions) 2020 2019 Long-term Investments: Equity securities $ 776 $ 836 Other 45 47 Total $ 821 $ 883 Abbott’s long-term investments as of December 31, 2020 declined versus the balance as of December 31, 2019 due primarily to investment impairments totaling approximately $115 million, recorded in Other (income) expense, net within the Consolidated Statement of Earnings, which was partially offset by approximately $35 million of additional investments during 2020. Abbott’s equity securities as of December 31, 2020 and December 31, 2019, include $366 million and $346 million, respectively, of investments in mutual funds that are held in a rabbi trust acquired as part of the St. Jude Medical, Inc. (St. Jude Medical) business acquisition. These investments, which are specifically designated as available for the purpose of paying benefits under a deferred compensation plan, are not available for general corporate purposes and are subject to creditor claims in the event of insolvency. Abbott also holds certain investments as of December 31, 2020 with a carrying value of $277 million that are accounted for under the equity method of accounting and other equity investments with a carrying value of $113 million that do not have a readily determinable fair value. The $113 million carrying value is net of an approximately $60 million impairment of an investment in 2020 for which Abbott had previously recorded an unrealized gain of approximately $50 million in 2018. Note 5 — Supplemental Financial Information (Continued) In 2019, in conjunction with the acquisition of Cephea Valve Technologies, Inc., Abbott acquired a research & development (R&D) asset valued at $102 million, which was immediately expensed. The $102 million of expense was recorded in the R&D line of Abbott's Consolidated Statement of Earnings. December 31, December 31, (in millions) 2020 2019 Other Accrued Liabilities: Accrued rebates payable to government agencies $ 316 $ 212 Accrued other rebates (a) 805 655 All other 4,044 3,168 Total $ 5,165 $ 4,035 (a) Accrued wholesaler chargeback rebates of $178 million and $175 million at December 31, 2020 and 2019, respectively, are netted in trade receivables because Abbott’s customers are invoiced at a higher catalog price but only remit to Abbott their contract price for the products. December 31, December 31, (in millions) 2020 2019 Post-employment Obligations and Other Long-term Liabilities: Defined benefit pension plans and post-employment medical and dental plans for significant plans $ 3,119 $ 2,817 Deferred income taxes 1,406 1,546 Operating lease liabilities 902 755 All other (b) 3,684 3,944 Total $ 9,111 $ 9,062 (b) Includes approximately $740 million and $580 million of net unrecognized tax benefits in 2020 and 2019, respectively. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Dec. 31, 2020 | |
Accumulated Other Comprehensive Income (Loss) | |
Accumulated Other Comprehensive Income (Loss) | Note 6 — Accumulated Other Comprehensive Income (Loss) The components of the changes in accumulated other comprehensive income (loss) from continuing operations, net of income taxes, are as follows: Cumulative Gains (Losses) Cumulative Net Actuarial on Derivative Foreign (Losses) and Instruments Currency Prior Service Designated as Translation (Costs) and Cash Flow (in millions) Adjustments Credits Hedges Total Balance at December 31, 2018 $ (4,912) $ (2,726) $ 52 $ (7,586) Other comprehensive income (loss) before reclassifications (12) (719) 2 (729) (Income) loss amounts reclassified from accumulated other comprehensive income (a) — (95) (55) (150) Net current period other comprehensive income (loss) (12) (814) (53) (879) Balance at December 31, 2019 (4,924) (3,540) (1) (8,465) Other comprehensive income (loss) before reclassifications 65 (523) (140) (598) (Income) loss amounts reclassified from accumulated other comprehensive income (a) — 192 (75) 117 Net current period other comprehensive income (loss) 65 (331) (215) (481) Balance at December 31, 2020 $ (4,859) $ (3,871) $ (216) $ (8,946) (a) (Income) loss amounts reclassified from accumulated other comprehensive income related to cash flow hedges are recorded as Cost of products sold. Net actuarial losses and prior service cost is included as a component of net periodic benefit cost – see Note 14 for additional information . |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets | |
Goodwill and Intangible Assets | Note 7 — Goodwill and Intangible Assets The total amount of goodwill reported was $23.7 billion at December 31, 2020 and $23.2 billion at December 31, 2019. Foreign currency translation adjustments increased goodwill by approximately $550 million in 2020 and decreased goodwill $103 million in 2019. The amount of goodwill related to reportable segments at December 31, 2020 was $3.0 billion for the Established Pharmaceutical Products segment, $286 million for the Nutritional Products segment, $3.8 billion for the Diagnostic Products segment, and $16.6 billion for the Medical Devices segment. There was no reduction of goodwill relating to impairments in 2020 and 2019. The gross amount of amortizable intangible assets, primarily product rights and technology, was $27.8 billion and $27.6 billion as of December 31, 2020 and 2019, respectively, and accumulated amortization was $14.2 billion and $11.9 billion as of December 31, 2020 and 2019, respectively. Foreign currency translation adjustments increased intangible assets by approximately $67 million in 2020 and decreased intangible assets by $71 million in 2019. In 2020, asset impairments related to the Medical Devices segment decreased intangible assets by $148 million. The impairment was recorded in the Cost of products sold, excluding amortization of intangible assets line of Abbott’s Consolidated Statement of Earnings. The estimated annual amortization expense for intangible assets recorded at December 31, 2020 is approximately $2.0 billion in 2021, $2.0 billion in 2022, $1.9 billion in 2023, $1.9 billion in 2024 and $1.9 billion in 2025. Amortizable intangible assets are amortized over 2 to 20 years. Note 7 — Goodwill and Intangible Assets (Continued) Indefinite-lived intangible assets, which relate to IPR&D acquired in a business combination, were approximately $1.2 billion and $1.3 billion at December 31, 2020 and 2019, respectively. The decrease is due to an IPR&D intangible asset related to the Medical Devices segment that became amortizable in 2020 and a $55 million impairment of an IPR&D intangible asset related to the Medical Devices segment that was recorded in the Research and development line of Abbott’s Consolidated Statement of Earnings in 2020. |
Restructuring Plans
Restructuring Plans | 12 Months Ended |
Dec. 31, 2020 | |
Restructuring Plans | |
Restructuring Plans | Note 8 — Restructuring Plans From 2017 to 2020, Abbott management approved restructuring plans as part of the integration of the acquisitions of St. Jude Medical into the Medical Devices segment, and Alere Inc. (Alere) into the Diagnostic Products segment, in order to leverage economies of scale and reduce costs. As of December 31, 2017, the accrued balance associated with these actions was $68 million. From 2018 to 2020, Abbott recorded employee related severance and other charges totaling approximately $137 million, comprised of $13 million in 2020, $72 million in 2019 and $52 million in 2018. Approximately $30 million was recorded in Cost of products sold, approximately $15 million was recorded in Research and development, and approximately $92 million was recorded in Selling, general and administrative expense over the last three years. As of December 31, 2020, the accrued liabilities remaining in the Consolidated Balance Sheet related to these actions total $25 million and primarily represent severance obligations. From 2016 to 2020, Abbott management approved plans to streamline operations in order to reduce costs and improve efficiencies in various Abbott businesses including the nutritional, established pharmaceuticals and vascular businesses. Abbott recorded employee related severance and other charges of approximately $36 million in 2020, $66 million in 2019 and $28 million in 2018. Approximately $6 million in 2020, $16 million in 2019 and $10 million in 2018 are recorded in Cost of products sold, approximately $2 million in 2020, $28 million in 2019 and $2 million in 2018 are recorded in Research and development, and approximately $28 million in 2020, $22 million in 2019 and $16 million in 2018 are recorded in Selling, general and administrative expense. The following summarizes the activity for these restructurings: (in millions) Accrued balance at December 31, 2017 $ 119 Restructuring charges 28 Payments and other adjustments (77) Accrued balance at December 31, 2018 70 Restructuring charges 66 Payments and other adjustments (57) Accrued balance at December 31, 2019 79 Restructuring charges 36 Payments and other adjustments (45) Accrued balance at December 31, 2020 $ 70 |
Incentive Stock Programs
Incentive Stock Programs | 12 Months Ended |
Dec. 31, 2020 | |
Incentive Stock Programs | |
Incentive Stock Programs | Note 9 — Incentive Stock Program The 2017 Incentive Stock Program authorizes the granting of nonqualified stock options, restricted stock awards, restricted stock units, performance awards, foreign benefits and other share-based awards. Stock options and restricted stock awards and units comprise the majority of benefits that have been granted and are currently outstanding under this program and a prior program. In 2020, Abbott granted 4,015,420 stock options, 569,961 restricted stock awards and 5,239,575 restricted stock units under this program. Note 9 — Incentive Stock Program (Continued) Under Abbott’s stock incentive programs, the purchase price of shares under option must be at least equal to the fair market value of the common stock on the date of grant, and the maximum term of an option is 10 years. Options generally vest equally over three years. Restricted stock awards generally vest over 3 years, with no more than one-third In April 2017, Abbott’s shareholders authorized the 2017 Incentive Stock Program under which a maximum of 170 million shares were available for issuance. At December 31, 2020, approximately 113 million shares remained available for future issuance. The following table summarizes stock option activity for the year ended December 31, 2020 and the outstanding stock options as of December 31, 2020. Weighted Weighted Average Average Remaining Aggregate (intrinsic values in millions) Options Exercise Price Life (Years) Intrinsic Value Outstanding at December 31, 2019 29,877,915 $ 48.78 6.2 $ 1,138 Granted 4,015,420 87.84 Exercised (4,872,830) 39.62 Lapsed (100,619) 75.22 Outstanding at December 31, 2020 28,919,886 $ 55.65 6.0 $ 1,557 Exercisable at December 31, 2020 20,390,745 $ 46.16 5.0 $ 1,291 The following table summarizes restricted stock awards and units activity for the year ended December 31, 2020. Weighted Average Grant-Date Share Units Fair Value Outstanding at December 31, 2019 14,463,314 $ 65.51 Granted 5,809,536 87.83 Vested (7,167,631) 60.67 Forfeited (612,351) 75.16 Outstanding at December 31, 2020 12,492,868 $ 78.19 The fair market value of restricted stock awards and units vested in 2020, 2019 and 2018 was $631 million, $588 million and $458 million, respectively. The total intrinsic value of options exercised in 2020, 2019 and 2018 was $279 million, $315 million and $249 million, respectively. The total unrecognized compensation cost related to all share-based compensation plans at December 31, 2020 amounted to approximately $407 million, which is expected to be recognized over the next three years. Note 9 — Incentive Stock Program (Continued) Total non-cash stock compensation expense charged against income from continuing operations in 2020, 2019 and 2018 for share-based plans totaled approximately $546 million, $519 million and $477 million, respectively, and the tax benefit recognized was approximately $200 million, $197 million and $185 million, respectively. Stock compensation cost capitalized as part of inventory is not significant. The table below summarizes the fair value of an option granted in 2020, 2019 and 2018 and the assumptions included in the Black-Scholes option-pricing model used to estimate the fair value: 2020 2019 2018 Fair value $ 14.39 $ 14.50 $ 10.93 Risk-free interest rate 1.3 % 2.5 % 2.7 % Average life of options (years) 6.0 6.0 6.0 Volatility 19.4 % 19.8 % 19.0 % Dividend yield 1.6 % 1.7 % 1.9 % The risk-free interest rate is based on the rates available at the time of the grant for zero-coupon U.S. government issues with a remaining term equal to the option’s expected life. The average life of an option is based on both historical and projected exercise and lapsing data. Expected volatility is based on implied volatilities from traded options on Abbott’s stock and historical volatility of Abbott’s stock over the expected life of the option. Dividend yield is based on the option’s exercise price and annual dividend rate at the time of grant. |
Debt and Lines of Credit
Debt and Lines of Credit | 12 Months Ended |
Dec. 31, 2020 | |
Debt and Lines of Credit | |
Debt and Lines of Credit | Note 10 — Debt and Lines of Credit The following is a summary of long-term debt at December 31: (in millions) 2020 2019 0.00% Notes, due 2020 $ — $ 1,272 2.55% Notes, due 2022 750 750 0.875% Notes, due 2023 1,398 1,272 3.40% Notes, due 2023 1,050 1,050 5-year term loan due 2024 577 546 0.10% Notes, due 2024 724 658 3.875% Notes, due 2025 500 500 2.95% Notes, due 2025 1,000 1,000 1.50% Notes, due 2026 1,398 1,272 3.75% Notes, due 2026 1,700 1,700 0.375% Notes, due 2027 724 658 1.15% Notes, due 2028 650 — 1.40% Notes, due 2030 650 — 4.75% Notes, due 2036 1,650 1,650 6.15% Notes, due 2037 547 547 6.00% Notes, due 2039 515 515 5.30% Notes, due 2040 694 694 4.75% Notes, due 2043 700 700 4.90% Notes, due 2046 3,250 3,250 Unamortized debt issuance costs (87) (90) Other, including fair value adjustments relating to interest rate hedge contracts designated as fair value hedges 144 (6) Total carrying amount of long-term debt 18,534 17,938 Less: Current portion 7 1,277 Total long-term portion $ 18,527 $ 16,661 On June 24, 2020, Abbott completed the issuance of $1.3 billion aggregate principal amount of senior notes, consisting of $650 million of its 1.15% Notes due 2028 and $650 million of its 1.40% Notes due 2030. On September 28, 2020, Abbott repaid the €1.140 billion outstanding principal amount of its 0.00% Notes due 2020 upon maturity. The repayment equated to approximately $1.3 billion. Abbott has readily available financial resources, including unused lines of credit that support commercial paper borrowing arrangements and provide Abbott with the ability to borrow up to $5 billion on an unsecured basis. The lines of credit are part of a Five Year Credit Agreement (Revolving Credit Agreement) that Abbott entered into on November 12, 2020. At that time, Abbott also terminated its 2018 revolving credit agreement. There were no outstanding borrowings under the 2018 revolving credit agreement at the time of its termination. Any borrowings under the Revolving Credit Agreement will mature and be payable on November 12, 2025. Any borrowings under the Revolving Credit Agreement will bear interest, at Abbott’s option, based on either a base rate or Eurodollar rate, plus an applicable margin based on Abbott’s credit ratings. Note 10 — Debt and Lines of Credit (Continued) In 2019, Abbott’s long-term borrowings and debt issuance included the following: ● On November 19, 2019, Abbott’s wholly owned subsidiary, Abbott Ireland Financing DAC, completed an offering of €1.180 billion of long-term debt consisting of €590 million of 0.10% Notes due 2024 and €590 million of 0.375% Notes due 2027. The proceeds equated to approximately $1.3 billion. The Notes are guaranteed by Abbott. ● On November 21, 2019, Abbott borrowed ¥ 59.8 billion under a 5-year term loan and designated the yen-denominated loan as a hedge of its net investment in certain foreign subsidiaries. The term loan bears interest at TIBOR plus a fixed spread, and the interest rate is reset quarterly. The proceeds equated to approximately $550 million. In 2019, Abbott’s repayment of long-term debt included the following: ● $0.500 billion outstanding principal amount of its 2.80% Notes due 2020 – redeemed on February 24, 2019 ● $2.850 billion principal amount of its 2.9% Notes due 2021 – redeemed on December 19, 2019. Abbott incurred a charge of $63 million related to the early repayment of this debt. The 2.80% Notes were redeemed under the board of directors’ 2018 bond redemption authorization discussed below. The 2.9% Notes were redeemed under a bond redemption authorization approved by the board of directors in September 2019 for the early redemption of up to $5 billion of outstanding long-term notes. The 2019 bond redemption authorization superseded the board’s 2018 authorization. $2.15 billion of the $5 billion authorization remans available as of December 31, 2020. On January 5, 2018, Abbott repaid $2.8 billion under a 5-year term loan agreement and $1.15 billion of borrowings under its lines of credit. On February 16, 2018, the board of directors authorized the early redemption of up to $5 billion of outstanding long-term notes. 2018 redemptions under this authorization include the following: ● $0.947 billion principal amount of its 5.125% Notes due 2019 – redeemed on March 22, 2018 ● $1.055 billion of the $2.850 billion principal amount of its 2.35% Notes due 2019 – redeemed on March 22, 2018 ● $1.300 billion of the $1.795 billion outstanding principal amount of its 2.35% Notes due 2019 – redeemed on June 22, 2018 ● $0.495 billion outstanding principal amount of its 2.35% Notes due 2019 – redeemed on September 28, 2018 Abbott incurred a net charge of $14 million related to the March 22, 2018 early repayment of debt. On September 17, 2018, Abbott repaid upon maturity the $500 million aggregate principal amount outstanding of the 2.00% Senior Notes due 2018. On September 27, 2018, Abbott’s wholly owned subsidiary, Abbott Ireland Financing DAC, completed a euro debt offering of €3.420 billion of long-term debt consisting of €1.140 billion of non-interest bearing Senior Notes due 2020 at 99.727% of par value; €1.140 billion of 0.875% Senior Notes due 2023 at 99.912% of par value; and €1.140 billion of 1.50% Senior Notes due 2026 at 99.723% of par value. The proceeds equated to approximately $4 billion. The notes are guaranteed by Abbott. Note 10 — Debt and Lines of Credit (Continued) On October 28, 2018, Abbott redeemed approximately $4 billion of debt, which included $750 million principal amount of its 2.00% Notes due 2020; $597 million principal amount of its 4.125% Notes due 2020; $900 million principal amount of its 3.25% Notes due 2023; $450 million principal amount of its 3.4% Notes due 2023; and $1.300 billion principal amount of its 3.75% Notes due 2026. These amounts were in addition to the $5 billion authorization in 2018 discussed above. In conjunction with the redemption, Abbott unwound approximately $1.1 billion in interest rate swaps relating to the 3.40% Note due in 2023 and the 3.75% Note due in 2026. Abbott incurred a net charge of $153 million related to the early repayment of this debt and the unwinding of related interest rate swaps. Principal payments required on long-term debt outstanding at December 31, 2020 are $7 million in 2021, $753 million in 2022, $2.4 billion in 2023, $1.3 billion in 2024, $1.5 billion in 2025 and $12.5 billion in 2026 and thereafter. At December 31, 2020, Abbott’s long-term debt rating was A by Standard & Poor’s Corporation and A3 by Moody’s. Abbott’s weighted-average interest rate on short-term borrowings was 0.4%at December 31, 2020, 2019 and 2018. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases | |
Leases | Note 11 — Leases Leases where Abbott is the Lessee Abbott has entered into operating leases as the lessee for office space, manufacturing facilities, R&D laboratories, warehouses, vehicles and equipment. Finance leases are not significant. Abbott’s operating leases generally have remaining lease terms of 1 to 10 years. Some leases include options to extend beyond the original lease term options to terminate early For all of its asset classes, Abbott elected the practical expedient allowed under FASB ASC No. 842, “Leases” to account for each lease component (e.g., the right to use office space) and the associated non-lease components (e.g., maintenance services) as a single lease component. Abbott also elected the short-term lease accounting policy for all asset classes; therefore, Abbott is not recognizing a lease liability or right of use (ROU) asset for any lease that, at the commencement date, has a lease term of 12 months or less and does not include an option to purchase the underlying asset that Abbott is reasonably certain to exercise. As Abbott’s leases typically do not provide an implicit rate, the interest rate used to determine the present value of the payments under each lease typically reflects Abbott’s incremental borrowing rate based on information available at the lease commencement date. Abbott’s incremental borrowing rates at January 1, 2019 were used for operating leases that commenced prior to January 1, 2019 when ASC 842 was adopted. Note 11 — Leases (Continued) The following table provides information related to Abbott’s operating leases: (in millions, except weighted averages) 2020 2019 Operating lease cost (a) $ 329 $ 314 Cash paid for amounts included in the measurement of operating lease liabilities 264 253 ROU assets arising from entering into new operating lease obligations 396 310 Weighted average remaining lease term at December 31 (in years) 8 8 Weighted average discount rate at December 31 3.2 % 3.9 % (a) Includes short-term lease expense and variable lease costs, which were immaterial in the years ended December 31, 2020 and 2019. Future minimum lease payments under non-cancellable operating leases as of December 31, 2020 were as follows: (in millions) 2021 $ 272 2022 228 2023 177 2024 131 2025 100 Thereafter 407 Total future minimum lease payments – undiscounted 1,315 Less: imputed interest (172) Present value of lease liabilities $ 1,143 The following table summarizes the amounts and location of operating lease ROU assets and lease liabilities: (in millions) December 31, 2020 December 31, 2019 Balance Sheet Caption Operating Lease - ROU Asset $ 1,101 $ 934 Deferred income taxes and other assets Operating Lease Liability: Current $ 241 $ 205 Other accrued liabilities Non-current 902 755 Post-employment obligations and other long-term liabilities Total Liability $ 1,143 $ 960 Note 11 — Leases (Continued) Leases where Abbott is the Lessor Certain assets, primarily diagnostics instruments, are leased to customers under contractual arrangements that typically include an operating or sales-type lease as well as performance obligations for reagents and other consumables. Sales-type leases are not significant. Contract terms vary by customer and may include options to terminate the contract or options to extend the contract. Where instruments are provided under operating lease arrangements, some portion or the entire lease revenue may be variable and subject to subsequent non-lease component (e.g., reagent) sales. The allocation of revenue between the lease and non-lease components is based on stand-alone selling prices. Operating lease revenue represented less than 3 percent of Abbott’s total net sales in the years ended December 31, 2020 and 2019. Assets related to operating leases are reported within Net property and equipment on the Consolidated Balance Sheet. The original cost and the net book value of such assets were $3.3 billion and $1.4 billion, respectively, as of December 31, 2020 and $2.8 billion and $1.2 billion, respectively, as of December 31, 2019. |
Financial Instruments, Derivati
Financial Instruments, Derivatives and Fair Value Measures | 12 Months Ended |
Dec. 31, 2020 | |
Financial Instruments, Derivatives and Fair Value Measures | |
Financial Instruments, Derivatives and Fair Value Measures | Note 12 — Financial Instruments, Derivatives and Fair Value Measures Certain Abbott foreign subsidiaries enter into foreign currency forward exchange contracts to manage exposures to changes in foreign exchange rates primarily for anticipated intercompany purchases by those subsidiaries whose functional currencies are not the U.S. dollar. These contracts, with gross notional amounts totaling $8.1 billion at December 31, 2020, and $6.8 billion at December 31, 2019, are designated as cash flow hedges of the variability of the cash flows due to changes in foreign exchange rates and are recorded at fair value. Accumulated gains and losses as of December 31, 2020 will be included in Cost of products sold at the time the products are sold, generally through the next twelve Abbott enters into foreign currency forward exchange contracts to manage currency exposures for foreign currency denominated third-party trade payables and receivables, and for intercompany loans and trade accounts payable where the receivable or payable is denominated in a currency other than the functional currency of the entity. For intercompany loans, the contracts require Abbott to sell or buy foreign currencies, primarily European currencies, in exchange for primarily U.S. dollars and European currencies. For intercompany and trade payables and receivables, the currency exposures are primarily the U.S. dollar and European currencies. At December 31, 2020 and 2019, Abbott held gross notional amounts of $11.0 billion and $9.1 billion, respectively, of such foreign currency forward exchange contracts. In November 2019, Abbott borrowed ¥59.8 billion under a 5 Abbott is a party to interest rate hedge contracts totaling approximately $2.9 billion at December 31, 2020 and 2019, to manage its exposure to changes in the fair value of fixed-rate debt. These contracts are designated as fair value hedges of the variability of the fair value of fixed-rate debt due to changes in the long-term benchmark interest rates. The effect of the hedge is to change a fixed-rate interest obligation to a variable rate for that portion of the debt. Abbott records the contracts at fair value and adjusts the carrying amount of the fixed-rate debt by an offsetting amount. In October 2018, Abbott unwound approximately $1.1 billion in interest rate swaps relating to the 3.40% Note due in 2023 and the 3.75% Note due in 2026. As a part of the unwinding, Abbott paid approximately $90 million in cash, which was included in the Financing Activities section of the Consolidated Statement of Cash Flows in 2018. Note 12 — Financial Instruments, Derivatives and Fair Value Measures (Continued) The following table summarizes the amounts and location of certain derivative financial instruments as of December 31: Fair Value — Assets Fair Value — Liabilities (in millions) 2020 2019 Balance Sheet Caption 2020 2019 Balance Sheet Caption Interest rate swaps designated as fair value hedges $ 210 $ 48 Deferred income taxes and other assets $ — $ — Post-employment obligations and other long-term liabilities Foreign currency forward exchange contracts: Hedging instruments 30 110 Other prepaid expenses and receivables 433 56 Other accrued liabilities Others not designated as hedges 60 38 Other prepaid expenses and receivables 65 33 Other accrued liabilities Debt designated as a hedge of net investment in a foreign subsidiary — — n/a 577 546 Long-term debt $ 300 $ 196 $ 1,075 $ 635 The following table summarizes the activity for foreign currency forward exchange contracts designated as cash flow hedges, debt designated as a hedge of net investment in a foreign subsidiary and certain other derivative financial instruments, as well as the amounts and location of income (expense) and gain (loss) reclassified into income. Gain (loss) Recognized in Income (expense) and Other Comprehensive Gain (loss) Reclassified Income (loss) into Income (in millions) 2020 2019 2018 2020 2019 2018 Income Statement Caption Foreign currency forward exchange contracts designated as cash flow hedges $ (207) $ 9 $ 73 $ 102 $ 79 $ (114) Cost of products sold Debt designated as a hedge of net investment in a foreign subsidiary (31) 4 — n/a n/a n/a n/a Interest rate swaps designated as fair value hedges n/a n/a n/a 162 148 (97) Interest expense A loss of $171 million, a gain of $75 million and a loss of $100 million were recognized in 2020, 2019 and 2018, respectively, related to foreign currency forward exchange contracts not designated as hedges. These amounts are reported in the Consolidated Statement of Earnings on the Net foreign exchange (gain) loss line. The interest rate swaps are designated as fair value hedges of the variability of the fair value of fixed-rate debt due to changes in the long-term benchmark interest rates. The hedged debt is marked to market, offsetting the effect of marking the interest rate swaps to market. Note 12 — Financial Instruments, Derivatives and Fair Value Measures (Continued) The carrying values and fair values of certain financial instruments as of December 31 are shown in the table below. The carrying values of all other financial instruments approximate their estimated fair values. The counterparties to financial instruments consist of select major international financial institutions. Abbott does not expect any losses from nonperformance by these counterparties. 2020 2019 Carrying Fair Carrying Fair (in millions) Value Value Value Value Long-term Investment Securities: Equity securities $ 776 $ 776 $ 836 $ 836 Other 45 45 47 47 Total Long-term debt (18,534) (22,809) (17,938) (20,772) Foreign Currency Forward Exchange Contracts: Receivable position 90 90 148 148 (Payable) position (498) (498) (89) (89) Interest Rate Hedge Contracts: Receivable position 210 210 48 48 (Payable) position — — — — The fair value of the debt was determined based on significant other observable inputs, including current interest rates. Note 12 — Financial Instruments, Derivatives and Fair Value Measures (Continued) The following table summarizes the bases used to measure certain assets and liabilities at fair value on a recurring basis in the balance sheet: Basis of Fair Value Measurement Quoted Significant Prices in Other Significant Outstanding Active Observable Unobservable (in millions) Balances Markets Inputs Inputs December 31, 2020: Equity securities $ 386 $ 386 $ — $ — Interest rate swap derivative financial instruments 210 — 210 — Foreign currency forward exchange contracts 90 — 90 — Total Assets $ 686 $ 386 $ 300 $ — Fair value of hedged long-term debt $ 3,049 $ — $ 3,049 $ — Foreign currency forward exchange contracts 498 — 498 — Contingent consideration related to business combinations 68 — — 68 Total Liabilities $ 3,615 $ — $ 3,547 $ 68 December 31, 2019: Equity securities $ 357 $ 357 $ — $ — Interest rate swap derivative financial instruments 48 — 48 — Foreign currency forward exchange contracts 148 — 148 — Total Assets $ 553 $ 357 $ 196 $ — Fair value of hedged long-term debt $ 2,890 $ — $ 2,890 $ — Foreign currency forward exchange contracts 89 — 89 — Contingent consideration related to business combinations 68 — — 68 Total Liabilities $ 3,047 $ — $ 2,979 $ 68 The fair value of foreign currency forward exchange contracts is determined using a market approach, which utilizes values for comparable derivative instruments. The fair value of the debt was determined based on the face value of the debt adjusted for the fair value of the interest rate swaps, which is based on a discounted cash flow analysis using significant other observable inputs. Contingent consideration relates to businesses acquired by Abbott. The fair value of the contingent consideration was determined based on an independent appraisal adjusted for the time value of money and other changes in fair value. The maximum amount for certain contingent consideration is not determinable as it is based on a percent of certain sales. Excluding such contingent consideration, the maximum amount estimated to be due is approximately $200 million, which is dependent upon attaining certain sales thresholds or based on the occurrence of certain events, such as regulatory approvals. |
Litigation and Environmental Ma
Litigation and Environmental Matters | 12 Months Ended |
Dec. 31, 2020 | |
Litigation and Environmental Matters | |
Litigation and Environmental Matters | Note 13 — Litigation and Environmental Matters Abbott has been identified as a potentially responsible party for investigation and cleanup costs at a number of locations in the United States and Puerto Rico under federal and state remediation laws and is investigating potential contamination at a number of company-owned locations. Abbott has recorded an estimated cleanup cost for each site for which management believes Abbott has a probable loss exposure. No individual site cleanup exposure is expected to exceed $4 million, and the aggregate cleanup exposure is not expected to exceed $10 million. Abbott is involved in various claims and legal proceedings, and Abbott estimates the range of possible loss for its legal proceedings and environmental exposures to be from approximately $90 million to $120 million. The recorded accrual balance at December 31, 2020 for these proceedings and exposures was approximately $105 million. This accrual represents management’s best estimate of probable loss, as defined by FASB ASC No. 450, “Contingencies.” Within the next year, legal proceedings may occur that may result in a change in the estimated loss accrued by Abbott. While it is not feasible to predict the outcome of all such proceedings and exposures with certainty, management believes that their ultimate disposition should not have a material adverse effect on Abbott’s financial position, cash flows, or results of operations. |
Post-Employment Benefits
Post-Employment Benefits | 12 Months Ended |
Dec. 31, 2020 | |
Post-Employment Benefits | |
Post-Employment Benefits | Note 14 — Post-Employment Benefits Retirement plans consist of defined benefit, defined contribution and medical and dental plans. Information for Abbott’s major defined benefit plans and post-employment medical and dental benefit plans is as follows: Medical and Dental Defined Benefit Plans Plans (in millions) 2020 2019 2020 2019 Projected benefit obligations, January 1 $ 11,238 $ 9,093 $ 1,556 $ 1,292 Service cost — benefits earned during the year 336 250 46 23 Interest cost on projected benefit obligations 300 337 42 52 (Gains) losses, primarily changes in discount rates, plan design changes, law changes and differences between actual and estimated health care costs 1,305 1,856 (5) 228 Benefits paid (327) (302) (73) (76) Other, including foreign currency translation 277 4 1 37 Projected benefit obligations, December 31 $ 13,129 $ 11,238 $ 1,567 $ 1,556 Plan assets at fair value, January 1 $ 10,277 $ 8,553 $ 360 $ 351 Actual return (loss) on plan assets 1,463 1,622 46 65 Company contributions 400 382 12 12 Benefits paid (327) (302) (65) (68) Other, including foreign currency translation 205 22 — — Plan assets at fair value, December 31 $ 12,018 $ 10,277 $ 353 $ 360 Projected benefit obligations greater than plan assets, December 31 $ (1,111) $ (961) $ (1,214) $ (1,196) Long-term assets $ 824 $ 687 $ — $ — Short-term liabilities (29) (26) (1) (1) Long-term liabilities (1,906) (1,622) (1,213) (1,195) Net liability $ (1,111) $ (961) $ (1,214) $ (1,196) Amounts Recognized in Accumulated Other Comprehensive Income (loss): Actuarial losses, net $ 4,559 $ 4,131 $ 486 $ 529 Prior service cost (credits) (5) (2) (67) (95) Total $ 4,554 $ 4,129 $ 419 $ 434 Note 14 — Post-Employment Benefits (Continued) The $1.3 billion and $1.9 billion of defined benefit plan losses in 2020 and 2019, respectively, that increased the projected benefit obligations in those years, primarily reflect the year-over-year decline in the discount rates used to measure the obligations. The projected benefit obligations for non-U.S. defined benefit plans were $4.1 billion and $3.3 billion at December 31, 2020 and 2019, respectively. The accumulated benefit obligations for all defined benefit plans were $11.9 billion and $10.2 billion at December 31, 2020 and 2019, respectively. For plans where the projected benefit obligations exceeded plan assets at December 31, 2020 and 2019, the projected benefit obligations and the aggregate plan assets were as follows: (in millions) 2020 2019 Projected benefit obligation $ 8,946 $ 7,585 Fair value of plan assets 7,010 5,936 For plans where the accumulated benefit obligations exceeded plan assets at December 31, 2020 and 2019, the aggregate accumulated benefit obligations, the projected benefit obligations and the aggregate plan assets were as follows: (in millions) 2020 2019 Accumulated benefit obligation $ 2,459 $ 1,985 Projected benefit obligation 2,773 2,266 Fair value of plan assets 965 821 The components of the net periodic benefit cost were as follows: Medical and Defined Benefit Plans Dental Plans (in millions) 2020 2019 2018 2020 2019 2018 Service cost — benefits earned during the year $ 336 $ 250 $ 293 $ 46 $ 23 $ 26 Interest cost on projected benefit obligations 300 337 308 42 52 48 Expected return on plans' assets (770) (710) (680) (28) (27) (33) Amortization of actuarial losses 255 132 205 21 22 33 Amortization of prior service cost (credits) 1 1 1 (28) (32) (45) Total net cost $ 122 $ 10 $ 127 $ 53 $ 38 $ 29 Other comprehensive income (loss) for each respective year includes the amortization of actuarial losses and prior service costs (credits) as noted in the previous table. Other comprehensive income (loss) for each respective year also includes: net actuarial losses of $611 million for defined benefit plans and a gain of $23 million for medical and dental plans in 2020, net actuarial losses of $944 million for defined benefit plans and a loss of $190 million for medical and dental plans in 2019; net actuarial losses of $86 million for defined benefit plans and a gain of $53 million for medical and dental plans in 2018. The net actuarial losses in 2020 and 2019 are primarily due to the year-over-year decline in discount rates partially offset by the impact of actual asset returns in excess of expected returns in each of the period. Note 14 — Post-Employment Benefits (Continued) The weighted average assumptions used to determine benefit obligations for defined benefit plans and medical and dental plans are as follows: 2020 2019 2018 Discount rate 2.3 % 3.0 % 4.0 % Expected aggregate average long-term change in compensation 4.3 % 4.3 % 4.3 % The weighted average assumptions used to determine the net cost for defined benefit plans and medical and dental plans are as follows: 2020 2019 2018 Discount rate 3.0 % 4.0 % 3.4 % Expected return on plan assets 7.5 % 7.5 % 7.7 % Expected aggregate average long-term change in compensation 4.3 % 4.3 % 4.4 % The assumed health care cost trend rates for medical and dental plans at December 31 were as follows: 2020 2019 2018 Health care cost trend rate assumed for the next year 8 % 9 % 9 % Rate that the cost trend rate gradually declines to 5 % 5 % 5 % Year that rate reaches the assumed ultimate rate 2025 2025 2025 The discount rates used to measure liabilities were determined based on high-quality fixed income securities that match the duration of the expected retiree benefits. The health care cost trend rates represent Abbott’s expected annual rates of change in the cost of health care benefits and are forward projections of health care costs as of the measurement date. Note 14 — Post-Employment Benefits (Continued) The following table summarizes the bases used to measure the defined benefit and medical and dental plan assets at fair value: Basis of Fair Value Measurement Quoted Significant Prices in Other Significant Outstanding Active Observable Unobservable Measured at (in millions) Balances Markets Inputs Inputs NAV (j) December 31, 2020: Equities: U.S. large cap (a) $ 3,410 $ 2,202 $ — $ — $ 1,208 U.S. mid and small cap (b) 775 721 — 3 51 International (c) 2,654 542 — — 2,112 Fixed income securities: U.S. government securities (d) 475 23 289 — 163 Corporate debt instruments (e) 1,408 425 908 — 75 Non-U.S. government securities (f) 523 16 — — 507 Other (g) 503 159 72 — 272 Absolute return funds (h) 1,618 462 — — 1,156 Cash and Cash Equivalents 281 77 — — 204 Other (i) 724 9 — — 715 $ 12,371 $ 4,636 $ 1,269 $ 3 $ 6,463 December 31, 2019: Equities: U.S. large cap (a) $ 2,873 $ 1,647 $ — $ — $ 1,226 U.S. mid and small cap (b) 648 548 4 2 94 International (c) 2,202 464 — — 1,738 Fixed income securities: U.S. government securities (d) 562 52 357 — 153 Corporate debt instruments (e) 1,266 362 724 — 180 Non-U.S. government securities (f) 445 3 2 — 440 Other (g) 320 69 27 — 224 Absolute return funds (h) 1,557 424 — — 1,133 Cash and Cash Equivalents 182 84 — — 98 Other (i) 582 8 — 1 573 $ 10,637 $ 3,661 $ 1,114 $ 3 $ 5,859 (a) A mix of index funds and actively managed equity accounts that are benchmarked to various large cap indices. (b) A mix of index funds and actively managed equity accounts that are benchmarked to various mid and small cap indices. (c) A mix of index funds and actively managed pooled investment funds that are benchmarked to various non-U.S. equity indices in both developed and emerging markets. (d) A mix of index funds and actively managed accounts that are benchmarked to various U.S. government bond indices. (e) A mix of index funds and actively managed accounts that are benchmarked to various corporate bond indices. (f) Primarily United Kingdom, Japan and Eurozone government bonds. (g) Primarily asset backed securities and an actively managed, diversified fixed income vehicle benchmarked to the one-month Libor / Euribor. (h) Primarily funds invested by managers that have a global mandate with the flexibility to allocate capital broadly across a wide range of asset classes and strategies including, but not limited to equities, fixed income, commodities, interest rate futures, currencies and other securities to outperform an agreed upon benchmark with specific return and volatility targets. Note 14 — Post-Employment Benefits (Continued) (i) Primarily investments in private funds, such as private equity, private credit, private real estate and private energy funds. (j) Investments measured at fair value using the net asset value (NAV) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheet. Equities that are valued using quoted prices are valued at the published market prices. Equities in a common collective trust or a registered investment company are valued at the NAV provided by the fund administrator. The NAV is based on the value of the underlying assets owned by the fund minus its liabilities. For approximately half of these funds, investments may be redeemed once per month, with a required 7 to 30 day notice period. For the remaining funds, daily redemption of an investment is allowed. Fixed income securities that are valued using significant other observable inputs are valued at prices obtained from independent financial service industry recognized vendors. Abbott did not have any unfunded commitments related to fixed income funds at December 31, 2020 and 2019. Fixed income securities in a common collective trust or a registered investment company are valued at the NAV provided by the fund administrator. For the majority of these funds, investments may be redeemed either weekly or monthly, with a required 2 to 14 day notice period. For the remaining funds, investments may be generally redeemed daily. Absolute return funds are valued at the NAV provided by the fund administrator. All private funds are valued at the NAV provided by the fund on a one-quarter lag adjusted for known cash flows and significant events through the reporting date. Abbott did not have any unfunded commitments related to absolute return funds at December 31, 2020 and 2019. Investments in these funds may be generally redeemed monthly or quarterly with required notice periods ranging from 5 to 90 days. For approximately $245 million and $110 million of the absolute return funds, redemptions are subject to a 33 percent gate and a 25 percent gate, respectively, and $60 million is subject to a lock until 2022. Investments in the private funds cannot be redeemed but the funds will make distributions through liquidation. The estimate of the liquidation period for each fund ranges from 2021 to 2030. Abbott’s unfunded commitment in these funds was $523 million and $579 million as of December 31, 2020 and 2019, respectively. The investment mix of equity securities, fixed income and other asset allocation strategies is based upon achieving a desired return, as well as balancing higher return, more volatile equity securities with lower return, less volatile fixed income securities. Investment allocations are made across a range of markets, industry sectors, capitalization sizes, and in the case of fixed income securities, maturities and credit quality. The plans do not directly hold any securities of Abbott. There are no known significant concentrations of risk in the plans’ assets. Abbott’s medical and dental plans’ assets are invested in a similar mix as the pension plan assets. The actual asset allocation percentages at year end are consistent with the company’s targeted asset allocation percentages. The plans’ expected return on assets, as shown above is based on management’s expectations of long-term average rates of return to be achieved by the underlying investment portfolios. In establishing this assumption, management considers historical and expected returns for the asset classes in which the plans are invested, as well as current economic and capital market conditions. Abbott funds its domestic pension plans according to IRS funding limitations. International pension plans are funded according to similar regulations. Abbott funded $400 million in 2020 and $382 million in 2019 to defined pension plans. Abbott expects to contribute approximately $410 million to its pension plans in 2021. Note 14 — Post-Employment Benefits (Continued) Total benefit payments expected to be paid to participants, which includes payments funded from company assets, as well as paid from the plans, are as follows: Defined Medical and (in millions) Benefit Plans Dental Plans 2021 $ 340 $ 72 2022 355 73 2023 373 74 2024 395 75 2025 415 76 2026 to 2030 2,410 394 The Abbott Stock Retirement Plan is the principal defined contribution plan. Abbott’s contributions to this plan were $164 million in 2020, $158 million in 2019 and $146 million in 2018. The 2018 contributions include amounts related to participants of the St. Jude Medical Retirement Plan which was terminated in January 2018. |
Taxes on Earnings from Continui
Taxes on Earnings from Continuing Operations | 12 Months Ended |
Dec. 31, 2020 | |
Taxes on Earnings from Continuing Operations | |
Taxes on Earnings from Continuing Operations | Note 15 — Taxes on Earnings from Continuing Operations Taxes on earnings from continuing operations reflect the annual effective rates, including charges for interest and penalties. Deferred income taxes reflect the tax consequences on future years of differences between the tax bases of assets and liabilities and their financial reporting amounts. In 2020, taxes on earnings from continuing operations include the recognition of approximately $170 million of tax benefits associated with the impairment of certain assets, approximately $140 million of net tax benefits as a result of the resolution of various tax positions related to prior years, and approximately $100 million in excess tax benefits associated with share-based compensation. In 2020, taxes on earnings from continuing operations also include a $26 million increase to the transition tax associated with the 2017 TCJA. The $26 million increase to the transition tax liability was the result of the resolution of various tax positions related to prior years. This adjustment increased the cumulative net tax expense related to the TCJA to $1.53 billion. The one-time transition tax is based on Abbott’s total post-1986 earnings and profits (E&P) that were previously deferred from U.S. income taxes. The tax computation also requires the determination of the amount of post-1986 E&P considered held in cash and other specified assets. As of December 31, 2020, the remaining balance of Abbott’s transition tax obligation is approximately $805 million, which will be paid over the next six years as allowed by the TCJA. In 2019, taxes on earnings from continuing operations included an $86 million reduction of the transition tax and $68 million of tax expense resulting from tax legislation enacted in the fourth quarter of 2019 in India. The $86 million reduction to the transition tax liability was the result of the issuance of final transition tax regulations by the U.S. Department of Treasury in 2019. In 2018, taxes on earnings from continuing operations included $98 million of net tax expense related to the settlement of Abbott’s 2014-2016 federal income tax audit in the U.S., partial settlement of the former St. Jude Medical consolidated group’s 2014 and 2015 federal income tax returns in the U.S. and audit settlements in various countries. In 2018, Abbott also recorded $130 million of additional tax expense related to the TCJA; the $130 million reflected a $120 million increase in the transition tax from $2.89 billion to $3.01 billion and a $10 million reduction in the net benefit related to the remeasurement of deferred tax assets and liabilities. Undistributed foreign earnings remain indefinitely reinvested in foreign operations. Determining the amount of unrecognized deferred tax liability related to any remaining undistributed foreign earnings not subject to the transition tax and additional outside basis difference in its foreign entities is not practicable. In the U.S., Abbott’s federal income tax returns through 2016 are settled. There are numerous other income tax jurisdictions for which tax returns are not yet settled, none of which are individually significant. Reserves for interest and penalties are not significant. Note 15 — Taxes on Earnings from Continuing Operations (Continued) Earnings from continuing operations before taxes, and the related provisions for taxes on earnings from continuing operations, were as follows: (in millions) 2020 2019 2018 Earnings From Continuing Operations Before Taxes: Domestic $ 1,588 $ 889 $ (430) Foreign 3,380 3,188 3,303 Total $ 4,968 $ 4,077 $ 2,873 (in millions) 2020 2019 2018 Taxes on Earnings From Continuing Operations: Current: Domestic $ 39 $ 291 $ (812) Foreign 566 590 606 Total current 605 881 (206) Deferred: Domestic (18) (305) 832 Foreign (90) (186) (87) Total deferred (108) (491) 745 Total $ 497 $ 390 $ 539 Differences between the effective income tax rate and the U.S. statutory tax rate were as follows: 2020 2019 2018 Statutory tax rate on earnings from continuing operations 21.0 % 21.0 % 21.0 % Impact of foreign operations (3.3) (5.0) (5.4) Impact of TCJA and other related items 0.5 (2.1) 6.3 Foreign-derived intangible income benefit (1.0) (2.0) (1.9) Domestic impairment loss (2.7) — (2.1) Excess tax benefits related to stock compensation (1.9) (2.5) (3.1) Research tax credit (1.0) (1.2) (1.8) Resolution of certain tax positions pertaining to prior years (2.8) — 3.4 Intercompany restructurings and integration 0.5 — — State taxes, net of federal benefit 0.5 0.8 0.4 All other, net 0.2 0.6 2.0 Effective tax rate on earnings from continuing operations 10.0 % 9.6 % 18.8 % Impact of foreign operations is primarily derived from operations in Puerto Rico, Switzerland, Ireland, the Netherlands, Costa Rica, Singapore, and Malta. Note 15 — Taxes on Earnings from Continuing Operations (Continued) The tax effect of the differences that give rise to deferred tax assets and liabilities were as follows: (in millions) 2020 2019 Deferred tax assets: Compensation and employee benefits $ 1,003 $ 982 Other, primarily reserves not currently deductible, and NOL’s and credit carryforwards 2,383 2,378 Trade receivable reserves 196 190 Inventory reserves 146 110 Lease liabilities 259 209 Deferred intercompany profit 254 259 Total deferred tax assets before valuation allowance 4,241 4,128 Valuation allowance (1,060) (978) Total deferred tax assets 3,181 3,150 Deferred tax liabilities: Depreciation (297) (219) Right of Use lease assets (251) (209) Other, primarily the excess of book basis over tax basis of intangible assets (2,876) (3,258) Total deferred tax liabilities (3,424) (3,686) Total net deferred tax assets (liabilities) $ (243) $ (536) Abbott has incurred losses in a foreign jurisdiction where realization of the future economic benefit is so remote that the benefit is not reflected as a deferred tax asset. The following table summarizes the gross amounts of unrecognized tax benefits without regard to reduction in tax liabilities or additions to deferred tax assets and liabilities if such unrecognized tax benefits were settled: (in millions) 2020 2019 January 1 $ 1,175 $ 1,120 Increase due to current year tax positions 190 137 Increase due to prior year tax positions 97 75 Decrease due to prior year tax positions (144) (117) Settlements (27) (32) Lapse of statute (81) (8) December 31 $ 1,210 $ 1,175 The total amount of unrecognized tax benefits that, if recognized, would impact the effective tax rate is approximately $1.08 billion. Abbott believes that it is reasonably possible that the recorded amount of gross unrecognized tax benefits may decrease within a range of $70 million to $430 million, including cash adjustments, within the next twelve months as a result of concluding various domestic and international tax matters. |
Segment and Geographic Area Inf
Segment and Geographic Area Information | 12 Months Ended |
Dec. 31, 2020 | |
Segment and Geographic Area Information | |
Segment and Geographic Area Information | Note 16 — Segment and Geographic Area Information Abbott’s principal business is the discovery, development, manufacture and sale of a broad line of health care products. Abbott’s products are generally sold directly to retailers, wholesalers, hospitals, health care facilities, laboratories, physicians’ offices and government agencies throughout the world. Abbott’s reportable segments are as follows: Established Pharmaceutical Products Nutritional Products Diagnostic Products Medical Devices Abbott's underlying accounting records are maintained on a legal entity basis for government and public reporting requirements. Segment disclosures are on a performance basis consistent with internal management reporting. The cost of some corporate functions and the cost of certain employee benefits are charged to segments at predetermined rates that approximate cost. Remaining costs, if any, are not allocated to segments. In addition, intangible asset amortization is not allocated to operating segments, and intangible assets and goodwill are not included in the measure of each segment’s assets. The following segment information has been prepared in accordance with the internal accounting policies of Abbott, as described above, and are not presented in accordance with generally accepted accounting principles applied to the consolidated financial statements. Net Sales to External Customers (a) Operating Earnings (a) (in millions) 2020 2019 2018 2020 2019 2018 Established Pharmaceutical Products $ 4,303 $ 4,486 $ 4,422 $ 794 $ 904 $ 894 Nutritional Products 7,647 7,409 7,229 1,751 1,705 1,652 Diagnostic Products 10,805 7,713 7,495 3,725 1,912 1,868 Medical Devices 11,787 12,239 11,370 3,038 3,769 3,500 Total Reportable Segments 34,542 31,847 30,516 $ 9,308 $ 8,290 $ 7,914 Other 66 57 62 Total $ 34,608 $ 31,904 $ 30,578 (a) Net sales and operating earnings were unfavorably affected by the impact of foreign exchange in 2020, 2019 and 2018. Note 16 — Segment and Geographic Area Information (Continued) (in millions) 2020 2019 2018 Total Reportable Segment Operating Earnings $ 9,308 $ 8,290 $ 7,914 Corporate functions and benefit plan costs (518) (468) (618) Net interest expense (500) (576) (721) Loss on extinguishment of debt — (63) (167) Share-based compensation (546) (519) (477) Amortization of intangible assets (2,132) (1,936) (2,178) Other, net (b) (644) (651) (880) Earnings from Continuing Operations Before Taxes $ 4,968 $ 4,077 $ 2,873 (b) Other, net includes integration costs associated with the acquisition of St. Jude Medical and Alere and restructuring charges in 2020, 2019 and 2018. Other, net in 2020 also includes costs related to asset impairments, partially offset by income from the settlement of litigation. Other, net in 2018 also includes inventory step-up amortization associated with the acquisition of Alere. Charges for restructuring actions and other cost reduction initiatives were approximately $125 million in 2020, $215 million in 2019 and $153 million in 2018. Additions to Depreciation Property and Equipment Total Assets (in millions) 2020 2019 2018 2020 2019 2018 2020 2019 2018 Established Pharmaceuticals $ 88 $ 98 $ 92 $ 109 $ 109 $ 131 $ 2,888 $ 2,858 $ 2,664 Nutritionals 143 139 150 201 141 86 3,478 3,274 3,071 Diagnostics 488 403 397 1,263 726 609 7,696 5,235 4,464 Medical Devices 281 266 294 402 532 408 6,893 6,640 5,886 Total Reportable Segments 1,000 906 933 1,975 1,508 1,234 $ 20,955 $ 18,007 $ 16,085 Other 195 172 167 218 160 160 Total $ 1,195 $ 1,078 $ 1,100 $ 2,193 $ 1,668 $ 1,394 (in millions) 2020 2019 2018 Total Reportable Segment Assets $ 20,955 $ 18,007 $ 16,085 Cash and investments 7,969 5,023 4,983 Goodwill and intangible assets 38,528 40,220 42,196 All other 5,096 4,637 3,909 Total Assets $ 72,548 $ 67,887 $ 67,173 Note 16 — Segment and Geographic Area Information (Continued) Net Sales to External Customers (c) (in millions) 2020 2019 2018 United States $ 13,022 $ 11,398 $ 10,839 Germany 2,108 1,751 1,619 China 1,965 2,346 2,311 Japan 1,386 1,435 1,326 India 1,323 1,397 1,333 Switzerland 1,140 1,068 1,005 The Netherlands 1,084 975 930 All Other Countries 12,580 11,534 11,215 Consolidated $ 34,608 $ 31,904 $ 30,578 (c) Long-lived assets on a geographic basis primarily include property and equipment. It excludes goodwill, intangible assets, deferred tax assets, and financial instruments. At December 31, 2020 and 2019, long-lived assets totaled $11.7 billion and $10.2 billion, respectively, and in the United States such assets totaled $6.1 billion and $5.1 billion, respectively. Long-lived asset balances associated with other countries were not material on an individual country basis in either of the two years. |
SCHEDULE II VALUATION AND QUALI
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2020 | |
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS | |
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS | ABBOTT LABORATORIES AND SUBSIDIARIES SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS FOR THE YEARS ENDED DECEMBER 31, 2020, 2019 AND 2018 (in millions of dollars) Amounts Balance Provisions/ Charged Off Allowances for Doubtful at Beginning Charges and Other Balance at Accounts and Product Returns of Year to Income Deductions End of Year 2020 $ 384 $ 187 $ (111) $ 460 2019 314 137 (68) 384 2018 294 110 (90) 314 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Summary of Significant Accounting Policies | |
NATURE OF BUSINESS | NATURE OF BUSINESS — Abbott’s principal business is the discovery, development, manufacture and sale of a broad line of health care products. |
BASIS OF CONSOLIDATION | BASIS OF CONSOLIDATION — The consolidated financial statements include the accounts of the parent company and subsidiaries, after elimination of intercompany transactions. |
USE OF ESTIMATES | USE OF ESTIMATES — The consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States and necessarily include amounts based on estimates and assumptions by management. Actual results could differ from those amounts. Significant estimates include amounts for sales rebates, income taxes, pension and other post-employment benefits, valuation of intangible assets, litigation, derivative financial instruments, and inventory and accounts receivable exposures. |
FOREIGN CURRENCY TRANSLATION | FOREIGN CURRENCY TRANSLATION — The statements of earnings of foreign subsidiaries whose functional currencies are other than the U.S. dollar are translated into U.S. dollars using average exchange rates for the period. The net assets of foreign subsidiaries whose functional currencies are other than the U.S. dollar are translated into U.S. dollars using exchange rates as of the balance sheet date. The U.S. dollar effects that arise from translating the net assets of these subsidiaries at changing rates are recorded in the foreign currency translation adjustment account, which is included in equity as a component of Accumulated other comprehensive income (loss). Transaction gains and losses are recorded on the Net foreign exchange (gain) loss line of the Consolidated Statement of Earnings. |
REVENUE RECOGNITION | REVENUE RECOGNITION — Revenue from product sales is recognized upon the transfer of control, which is generally upon shipment or delivery, depending on the delivery terms set forth in the customer contract. Provisions for discounts, rebates and sales incentives to customers, and returns and other adjustments are provided for in the period the related sales are recorded. Sales incentives to customers are not material. Historical data is readily available and reliable, and is used for estimating the amount of the reduction in gross sales. Revenue from the launch of a new product, from an improved version of an existing product, or for shipments in excess of a customer’s normal requirements are recorded when the conditions noted above are met. In those situations, management records a returns reserve for such revenue, if necessary. In certain of Abbott’s businesses, primarily within diagnostics, Abbott participates in selling arrangements that include multiple performance obligations (e.g., instruments, reagents, procedures, and service agreements). The total transaction price of the contract is allocated to each performance obligation in an amount based on the estimated relative standalone selling prices of the promised goods or services underlying each performance obligation. Sales of product rights for marketable products are recorded as revenue upon disposition of the rights. |
INCOME TAXES | INCOME TAXES — Deferred income taxes are provided for the tax effect of differences between the tax bases of assets and liabilities and their reported amounts in the financial statements at the enacted statutory rate to be in effect when the taxes are paid. No additional income taxes have been provided for any remaining undistributed foreign earnings not subject to the transition tax related to the U.S. Tax Cuts and Jobs Act (TCJA), or any additional outside basis differences that exist, as these amounts continue to be indefinitely reinvested in foreign operations. Effective for fiscal years beginning after December 31, 2017, the TCJA subjects taxpayers to tax on global intangible low-taxed income (GILTI) earned by certain foreign subsidiaries. Abbott treats the GILTI tax as a period expense and provides for the tax in the year that the tax is incurred. Interest and penalties on income tax obligations are included in taxes on earnings. |
EARNINGS PER SHARE | EARNINGS PER SHARE — Unvested restricted stock units and awards that contain non-forfeitable rights to dividends are treated as participating securities and are included in the computation of earnings per share under the two-class method. Under the two-class method, net earnings are allocated between common shares and participating securities. Earnings from Continuing Operations allocated to common shares in 2020, 2019 and 2018 were $4.449 billion, $3.666 billion and $2.320 billion, respectively. Net earnings allocated to common shares in 2020, 2019 and 2018 were $4.473 billion, $3.666 billion and $2.353 billion, respectively. |
PENSION AND POST-EMPLOYMENT BENEFITS | PENSION AND POST-EMPLOYMENT BENEFITS — Abbott accrues for the actuarially determined cost of pension and post-employment benefits over the service attribution periods of the employees. Abbott must develop long-term assumptions, the most significant of which are the health care cost trend rates, discount rates and the expected return on plan assets. Differences between the expected long-term return on plan assets and the actual return are amortized over a five-year period. Actuarial losses and gains are amortized over the remaining service attribution periods of the employees under the corridor method. |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS — For assets and liabilities that are measured using quoted prices in active markets, total fair value is the published market price per unit multiplied by the number of units held without consideration of transaction costs. Assets and liabilities that are measured using significant other observable inputs are valued by reference to similar assets or liabilities, adjusted for contract restrictions and other terms specific to that asset or liability. For these items, a significant portion of fair value is derived by reference to quoted prices of similar assets or liabilities in active markets. For all remaining assets and liabilities, fair value is derived using a fair value model, such as a discounted cash flow model or Black-Scholes model. Purchased intangible assets are recorded at fair value. The fair value of significant purchased intangible assets is based on independent appraisals. Abbott uses a discounted cash flow model to value intangible assets. The discounted cash flow model requires assumptions about the timing and amount of future net cash flows, risk, the cost of capital, terminal values and market participants. Intangible assets are reviewed for impairment on a quarterly basis. Goodwill and indefinite-lived intangible assets are tested for impairment at least annually. |
SHARE-BASED COMPENSATION | SHARE-BASED COMPENSATION — The fair value of stock options and restricted stock awards and units are amortized over their requisite service period, which could be shorter than the vesting period if an employee is retirement eligible, with a charge to compensation expense. |
LITIGATION | LITIGATION — Abbott accounts for litigation losses in accordance with Financial Accounting Standards Board (FASB) Accounting Standards Codification (ASC) No. 450, “Contingencies.” Under ASC No. 450, loss contingency provisions are recorded for probable losses at management’s best estimate of a loss, or when a best estimate cannot be made, a minimum loss contingency amount is recorded. Legal fees are recorded as incurred. |
CASH, CASH EQUIVALENTS AND INVESTMENTS | CASH, CASH EQUIVALENTS AND INVESTMENTS — Cash equivalents consist of bank time deposits, U.S. government securities money market funds and U.S. treasury bills with original maturities of three months or less. Abbott holds certain investments with a carrying value of $277 million that are accounted for under the equity method of accounting. Investments held in a rabbi trust and investments in publicly traded equity securities are recorded at fair value and changes in fair value are recorded in earnings. Investments in equity securities that are not traded on public stock exchanges are recorded at cost minus impairment, if any, plus or minus changes resulting from observable price changes in orderly transactions for identical or similar investments of the same issuer. Investments in debt securities are classified as held-to-maturity, as management has both the intent and ability to hold these securities to maturity, and are reported at cost, net of any unamortized premium or discount. Income relating to these securities is reported as interest income. |
TRADE RECEIVABLE VALUATIONS | TRADE RECEIVABLE VALUATIONS — Accounts receivable are stated at the net amount expected to be collected. The allowance for doubtful accounts reflects the current estimate of credit losses expected to be incurred over the life of the accounts receivable. Abbott considers various factors in establishing, monitoring, and adjusting its allowance for doubtful accounts, including the aging of the accounts and aging trends, the historical level of charge-offs, and specific exposures related to particular customers. Abbott also monitors other risk factors and forward-looking information, such as country risk, when determining credit limits for customers and establishing adequate allowances. Accounts receivable are charged off after all reasonable means to collect the full amount (including litigation, where appropriate) have been exhausted. |
INVENTORIES | INVENTORIES — Inventories are stated at the lower of cost (first-in, first-out basis) or net realizable value. Cost includes material and conversion costs. |
PROPERTY AND EQUIPMENT | PROPERTY AND EQUIPMENT — Depreciation and amortization are provided on a straight-line basis over the estimated useful lives of the assets. The following table shows estimated useful lives of property and equipment: Classification Estimated Useful Lives Buildings 10 to 50 years Equipment 2 to 20 years |
PRODUCT LIABILITY | PRODUCT LIABILITY — Abbott accrues for product liability claims when it is probable that a liability has been incurred and the amount of the liability can be reasonably estimated based on existing information. The liabilities are adjusted quarterly as additional information becomes available. Product liability losses are self-insured. |
RESEARCH AND DEVELOPMENT COSTS | RESEARCH AND DEVELOPMENT COSTS — Internal research and development costs are expensed as incurred. Clinical trial costs incurred by third parties are expensed as the contracted work is performed. Where contingent milestone payments are due to third parties under research and development arrangements, the milestone payment obligations are expensed when the milestone results are achieved. |
ACQUIRED IN-PROCESS AND COLLABORATIONS RESEARCH AND DEVELOPMENT (IPR&D) | ACQUIRED IN-PROCESS AND COLLABORATIONS RESEARCH AND DEVELOPMENT (IPR&D) — The initial costs of rights to IPR&D projects obtained in an asset acquisition are expensed as IPR&D unless the project has an alternative future use. These costs include initial payments incurred prior to regulatory approval in connection with research and development collaboration agreements that provide rights to develop, manufacture, market and/or sell pharmaceutical or medical device products. The fair value of IPR&D projects acquired in a business combination are capitalized and accounted for as indefinite-lived intangible assets until completed and are then amortized over the remaining useful life. Collaborations are not significant. |
CONCENTRATION OF RISK AND GUARANTEES | CONCENTRATION OF RISK AND GUARANTEES — Due to the nature of its operations, Abbott is not subject to significant concentration risks relating to customers, products or geographic locations. Product warranties are not significant. Abbott has no material exposures to off-balance sheet arrangements; no special purpose entities; nor activities that include non-exchange-traded contracts accounted for at fair value. Abbott periodically acquires a business or product rights in which Abbott agrees to pay contingent consideration based on attaining certain thresholds or based on the occurrence of certain events. |
Recently Adopted Accounting Standards | Recently Adopted Accounting Standards In February 2018, the FASB issued Accounting Standards Update (ASU) 2018-02, Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income In October 2016, the FASB issued ASU 2016-16, Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory In June 2016, the FASB issued ASU 2016-13, Financial Instruments – Credit Losses |
Recently Accounting Standards Not Yet Adopted | Recent Accounting Standards Not Yet Adopted In December 2019, the FASB issued ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Summary of Significant Accounting Policies | |
Schedule of estimated useful lives of property and equipment | Classification Estimated Useful Lives Buildings 10 to 50 years Equipment 2 to 20 years |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Revenue | |
Schedule of reportable segment included under sales category | 2020 2019 2018 (in millions) U.S. Int’l Total U.S. Int’l Total U.S. Int’l Total Established Pharmaceutical Products — Key Emerging Markets $ — $ 3,209 $ 3,209 $ — $ 3,392 $ 3,392 $ — $ 3,363 $ 3,363 Other — 1,094 1,094 — 1,094 1,094 — 1,059 1,059 Total — 4,303 4,303 — 4,486 4,486 — 4,422 4,422 Nutritionals — Pediatric Nutritionals 1,987 2,140 4,127 1,879 2,282 4,161 1,843 2,254 4,097 Adult Nutritionals 1,292 2,228 3,520 1,231 2,017 3,248 1,232 1,900 3,132 Total 3,279 4,368 7,647 3,110 4,299 7,409 3,075 4,154 7,229 Diagnostics — Core Laboratory 1,166 3,309 4,475 1,086 3,570 4,656 985 3,401 4,386 Molecular 621 817 1,438 149 293 442 152 332 484 Point of Care 369 147 516 438 123 561 432 121 553 Rapid Diagnostics 2,618 1,758 4,376 1,214 840 2,054 1,148 924 2,072 Total 4,774 6,031 10,805 2,887 4,826 7,713 2,717 4,778 7,495 Medical Devices — Rhythm Management 903 1,011 1,914 1,057 1,087 2,144 1,105 1,093 2,198 Electrophysiology 660 918 1,578 742 979 1,721 678 883 1,561 Heart Failure 547 193 740 574 195 769 467 179 646 Vascular 853 1,486 2,339 1,047 1,803 2,850 1,126 1,803 2,929 Structural Heart 540 707 1,247 616 784 1,400 488 751 1,239 Neuromodulation 564 138 702 660 171 831 690 174 864 Diabetes Care 864 2,403 3,267 678 1,846 2,524 457 1,476 1,933 Total 4,931 6,856 11,787 5,374 6,865 12,239 5,011 6,359 11,370 Other 38 28 66 27 30 57 36 26 62 Total $ 13,022 $ 21,586 $ 34,608 $ 11,398 $ 20,506 $ 31,904 $ 10,839 $ 19,739 $ 30,578 |
Schedule of changes in contract liabilities | (in millions) Contract Liabilities Balance at December 31, 2018 $ 259 Unearned revenue from cash received during the period 411 Revenue recognized related to contract liability balance (376) Balance at December 31, 2019 294 Unearned revenue from cash received during the period 505 Revenue recognized related to contract liability balance (394) Balance at December 31, 2020 $ 405 |
Supplemental Financial Inform_2
Supplemental Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Supplemental Financial Information | |
Summary of activity of allowance for doubtful accounts | (in millions) Allowance for Doubtful Accounts Balance at December 31, 2019 $ 228 Impact of adopting ASU 2016-13 7 Provisions/charges to income 88 Amounts charged off and other deductions (35) Balance at December 31, 2020 $ 288 |
Schedule of long-term investments | December 31, December 31, (in millions) 2020 2019 Long-term Investments: Equity securities $ 776 $ 836 Other 45 47 Total $ 821 $ 883 |
Schedule of other accrued liabilities | December 31, December 31, (in millions) 2020 2019 Other Accrued Liabilities: Accrued rebates payable to government agencies $ 316 $ 212 Accrued other rebates (a) 805 655 All other 4,044 3,168 Total $ 5,165 $ 4,035 (a) Accrued wholesaler chargeback rebates of $178 million and $175 million at December 31, 2020 and 2019, respectively, are netted in trade receivables because Abbott’s customers are invoiced at a higher catalog price but only remit to Abbott their contract price for the products. |
Schedule of post-employment obligations and other long-term liabilities | December 31, December 31, (in millions) 2020 2019 Post-employment Obligations and Other Long-term Liabilities: Defined benefit pension plans and post-employment medical and dental plans for significant plans $ 3,119 $ 2,817 Deferred income taxes 1,406 1,546 Operating lease liabilities 902 755 All other (b) 3,684 3,944 Total $ 9,111 $ 9,062 (b) Includes approximately $740 million and $580 million of net unrecognized tax benefits in 2020 and 2019, respectively. |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Accumulated Other Comprehensive Income (Loss) | |
Schedule of accumulated other comprehensive income (loss), net of taxes | Cumulative Gains (Losses) Cumulative Net Actuarial on Derivative Foreign (Losses) and Instruments Currency Prior Service Designated as Translation (Costs) and Cash Flow (in millions) Adjustments Credits Hedges Total Balance at December 31, 2018 $ (4,912) $ (2,726) $ 52 $ (7,586) Other comprehensive income (loss) before reclassifications (12) (719) 2 (729) (Income) loss amounts reclassified from accumulated other comprehensive income (a) — (95) (55) (150) Net current period other comprehensive income (loss) (12) (814) (53) (879) Balance at December 31, 2019 (4,924) (3,540) (1) (8,465) Other comprehensive income (loss) before reclassifications 65 (523) (140) (598) (Income) loss amounts reclassified from accumulated other comprehensive income (a) — 192 (75) 117 Net current period other comprehensive income (loss) 65 (331) (215) (481) Balance at December 31, 2020 $ (4,859) $ (3,871) $ (216) $ (8,946) (a) (Income) loss amounts reclassified from accumulated other comprehensive income related to cash flow hedges are recorded as Cost of products sold. Net actuarial losses and prior service cost is included as a component of net periodic benefit cost – see Note 14 for additional information . |
Restructuring Plans (Tables)
Restructuring Plans (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Restructuring Plans | |
Summary of restructuring activity | (in millions) Accrued balance at December 31, 2017 $ 119 Restructuring charges 28 Payments and other adjustments (77) Accrued balance at December 31, 2018 70 Restructuring charges 66 Payments and other adjustments (57) Accrued balance at December 31, 2019 79 Restructuring charges 36 Payments and other adjustments (45) Accrued balance at December 31, 2020 $ 70 |
Incentive Stock Programs (Table
Incentive Stock Programs (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Incentive Stock Programs | |
Schedule of stock options outstanding and exercisable | Weighted Weighted Average Average Remaining Aggregate (intrinsic values in millions) Options Exercise Price Life (Years) Intrinsic Value Outstanding at December 31, 2019 29,877,915 $ 48.78 6.2 $ 1,138 Granted 4,015,420 87.84 Exercised (4,872,830) 39.62 Lapsed (100,619) 75.22 Outstanding at December 31, 2020 28,919,886 $ 55.65 6.0 $ 1,557 Exercisable at December 31, 2020 20,390,745 $ 46.16 5.0 $ 1,291 |
Schedule of restricted stock awards and units activity | Weighted Average Grant-Date Share Units Fair Value Outstanding at December 31, 2019 14,463,314 $ 65.51 Granted 5,809,536 87.83 Vested (7,167,631) 60.67 Forfeited (612,351) 75.16 Outstanding at December 31, 2020 12,492,868 $ 78.19 |
Schedule of fair value assumptions used to estimate fair value of option | 2020 2019 2018 Fair value $ 14.39 $ 14.50 $ 10.93 Risk-free interest rate 1.3 % 2.5 % 2.7 % Average life of options (years) 6.0 6.0 6.0 Volatility 19.4 % 19.8 % 19.0 % Dividend yield 1.6 % 1.7 % 1.9 % |
Debt and Lines of Credit (Table
Debt and Lines of Credit (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt and Lines of Credit | |
Schedule of long-term debt | The following is a summary of long-term debt at December 31: (in millions) 2020 2019 0.00% Notes, due 2020 $ — $ 1,272 2.55% Notes, due 2022 750 750 0.875% Notes, due 2023 1,398 1,272 3.40% Notes, due 2023 1,050 1,050 5-year term loan due 2024 577 546 0.10% Notes, due 2024 724 658 3.875% Notes, due 2025 500 500 2.95% Notes, due 2025 1,000 1,000 1.50% Notes, due 2026 1,398 1,272 3.75% Notes, due 2026 1,700 1,700 0.375% Notes, due 2027 724 658 1.15% Notes, due 2028 650 — 1.40% Notes, due 2030 650 — 4.75% Notes, due 2036 1,650 1,650 6.15% Notes, due 2037 547 547 6.00% Notes, due 2039 515 515 5.30% Notes, due 2040 694 694 4.75% Notes, due 2043 700 700 4.90% Notes, due 2046 3,250 3,250 Unamortized debt issuance costs (87) (90) Other, including fair value adjustments relating to interest rate hedge contracts designated as fair value hedges 144 (6) Total carrying amount of long-term debt 18,534 17,938 Less: Current portion 7 1,277 Total long-term portion $ 18,527 $ 16,661 |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases | |
Schedule of information related to operating leases | (in millions, except weighted averages) 2020 2019 Operating lease cost (a) $ 329 $ 314 Cash paid for amounts included in the measurement of operating lease liabilities 264 253 ROU assets arising from entering into new operating lease obligations 396 310 Weighted average remaining lease term at December 31 (in years) 8 8 Weighted average discount rate at December 31 3.2 % 3.9 % (a) Includes short-term lease expense and variable lease costs, which were immaterial in the years ended December 31, 2020 and 2019. |
Schedule of future minimum lease payments | Future minimum lease payments under non-cancellable operating leases as of December 31, 2020 were as follows: (in millions) 2021 $ 272 2022 228 2023 177 2024 131 2025 100 Thereafter 407 Total future minimum lease payments – undiscounted 1,315 Less: imputed interest (172) Present value of lease liabilities $ 1,143 |
Schedule of operating lease balance sheet disclosure | (in millions) December 31, 2020 December 31, 2019 Balance Sheet Caption Operating Lease - ROU Asset $ 1,101 $ 934 Deferred income taxes and other assets Operating Lease Liability: Current $ 241 $ 205 Other accrued liabilities Non-current 902 755 Post-employment obligations and other long-term liabilities Total Liability $ 1,143 $ 960 |
Financial Instruments, Deriva_2
Financial Instruments, Derivatives and Fair Value Measures (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Financial Instruments, Derivatives and Fair Value Measures | |
Summary of the amounts and location of certain derivative financial instruments | Fair Value — Assets Fair Value — Liabilities (in millions) 2020 2019 Balance Sheet Caption 2020 2019 Balance Sheet Caption Interest rate swaps designated as fair value hedges $ 210 $ 48 Deferred income taxes and other assets $ — $ — Post-employment obligations and other long-term liabilities Foreign currency forward exchange contracts: Hedging instruments 30 110 Other prepaid expenses and receivables 433 56 Other accrued liabilities Others not designated as hedges 60 38 Other prepaid expenses and receivables 65 33 Other accrued liabilities Debt designated as a hedge of net investment in a foreign subsidiary — — n/a 577 546 Long-term debt $ 300 $ 196 $ 1,075 $ 635 |
Schedule of derivatives gain (loss) in OCI and earnings | Gain (loss) Recognized in Income (expense) and Other Comprehensive Gain (loss) Reclassified Income (loss) into Income (in millions) 2020 2019 2018 2020 2019 2018 Income Statement Caption Foreign currency forward exchange contracts designated as cash flow hedges $ (207) $ 9 $ 73 $ 102 $ 79 $ (114) Cost of products sold Debt designated as a hedge of net investment in a foreign subsidiary (31) 4 — n/a n/a n/a n/a Interest rate swaps designated as fair value hedges n/a n/a n/a 162 148 (97) Interest expense |
Schedule of carrying values and fair values of certain financial instruments | 2020 2019 Carrying Fair Carrying Fair (in millions) Value Value Value Value Long-term Investment Securities: Equity securities $ 776 $ 776 $ 836 $ 836 Other 45 45 47 47 Total Long-term debt (18,534) (22,809) (17,938) (20,772) Foreign Currency Forward Exchange Contracts: Receivable position 90 90 148 148 (Payable) position (498) (498) (89) (89) Interest Rate Hedge Contracts: Receivable position 210 210 48 48 (Payable) position — — — — |
Schedule of assets and liabilities measured at fair value on a recurring basis | Basis of Fair Value Measurement Quoted Significant Prices in Other Significant Outstanding Active Observable Unobservable (in millions) Balances Markets Inputs Inputs December 31, 2020: Equity securities $ 386 $ 386 $ — $ — Interest rate swap derivative financial instruments 210 — 210 — Foreign currency forward exchange contracts 90 — 90 — Total Assets $ 686 $ 386 $ 300 $ — Fair value of hedged long-term debt $ 3,049 $ — $ 3,049 $ — Foreign currency forward exchange contracts 498 — 498 — Contingent consideration related to business combinations 68 — — 68 Total Liabilities $ 3,615 $ — $ 3,547 $ 68 December 31, 2019: Equity securities $ 357 $ 357 $ — $ — Interest rate swap derivative financial instruments 48 — 48 — Foreign currency forward exchange contracts 148 — 148 — Total Assets $ 553 $ 357 $ 196 $ — Fair value of hedged long-term debt $ 2,890 $ — $ 2,890 $ — Foreign currency forward exchange contracts 89 — 89 — Contingent consideration related to business combinations 68 — — 68 Total Liabilities $ 3,047 $ — $ 2,979 $ 68 |
Post-Employment Benefits (Table
Post-Employment Benefits (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Post-Employment Benefits | |
Schedule of aggregate accumulated benefit obligations, projected benefit obligations and aggregate plan assets for plans whose accumulated benefit obligation exceeded plan assets | Medical and Dental Defined Benefit Plans Plans (in millions) 2020 2019 2020 2019 Projected benefit obligations, January 1 $ 11,238 $ 9,093 $ 1,556 $ 1,292 Service cost — benefits earned during the year 336 250 46 23 Interest cost on projected benefit obligations 300 337 42 52 (Gains) losses, primarily changes in discount rates, plan design changes, law changes and differences between actual and estimated health care costs 1,305 1,856 (5) 228 Benefits paid (327) (302) (73) (76) Other, including foreign currency translation 277 4 1 37 Projected benefit obligations, December 31 $ 13,129 $ 11,238 $ 1,567 $ 1,556 Plan assets at fair value, January 1 $ 10,277 $ 8,553 $ 360 $ 351 Actual return (loss) on plan assets 1,463 1,622 46 65 Company contributions 400 382 12 12 Benefits paid (327) (302) (65) (68) Other, including foreign currency translation 205 22 — — Plan assets at fair value, December 31 $ 12,018 $ 10,277 $ 353 $ 360 Projected benefit obligations greater than plan assets, December 31 $ (1,111) $ (961) $ (1,214) $ (1,196) Long-term assets $ 824 $ 687 $ — $ — Short-term liabilities (29) (26) (1) (1) Long-term liabilities (1,906) (1,622) (1,213) (1,195) Net liability $ (1,111) $ (961) $ (1,214) $ (1,196) Amounts Recognized in Accumulated Other Comprehensive Income (loss): Actuarial losses, net $ 4,559 $ 4,131 $ 486 $ 529 Prior service cost (credits) (5) (2) (67) (95) Total $ 4,554 $ 4,129 $ 419 $ 434 |
Schedule of projected benefit obligations and the aggregate plan assets, for plans where the projected benefit obligations exceeded plan assets | (in millions) 2020 2019 Projected benefit obligation $ 8,946 $ 7,585 Fair value of plan assets 7,010 5,936 |
Schedule of plans where the accumulated benefit obligations exceeded plan assets the aggregate accumulated benefit obligations, the projected benefit obligations and the aggregate plan assets | (in millions) 2020 2019 Accumulated benefit obligation $ 2,459 $ 1,985 Projected benefit obligation 2,773 2,266 Fair value of plan assets 965 821 |
Schedule of components of the net periodic benefit cost for the entity's major defined benefit plans and post-employment medical and dental benefit plans | Medical and Defined Benefit Plans Dental Plans (in millions) 2020 2019 2018 2020 2019 2018 Service cost — benefits earned during the year $ 336 $ 250 $ 293 $ 46 $ 23 $ 26 Interest cost on projected benefit obligations 300 337 308 42 52 48 Expected return on plans' assets (770) (710) (680) (28) (27) (33) Amortization of actuarial losses 255 132 205 21 22 33 Amortization of prior service cost (credits) 1 1 1 (28) (32) (45) Total net cost $ 122 $ 10 $ 127 $ 53 $ 38 $ 29 |
Schedule of weighted average assumptions used to determine benefit obligations and net cost for defined benefit plans and medical and dental plans | The weighted average assumptions used to determine benefit obligations for defined benefit plans and medical and dental plans are as follows: 2020 2019 2018 Discount rate 2.3 % 3.0 % 4.0 % Expected aggregate average long-term change in compensation 4.3 % 4.3 % 4.3 % The weighted average assumptions used to determine the net cost for defined benefit plans and medical and dental plans are as follows: 2020 2019 2018 Discount rate 3.0 % 4.0 % 3.4 % Expected return on plan assets 7.5 % 7.5 % 7.7 % Expected aggregate average long-term change in compensation 4.3 % 4.3 % 4.4 % |
Schedule of assumed health care cost trend rates | The assumed health care cost trend rates for medical and dental plans at December 31 were as follows: 2020 2019 2018 Health care cost trend rate assumed for the next year 8 % 9 % 9 % Rate that the cost trend rate gradually declines to 5 % 5 % 5 % Year that rate reaches the assumed ultimate rate 2025 2025 2025 |
Schedule of basis used to measure the defined benefit and medical and dental plan assets at fair value | Basis of Fair Value Measurement Quoted Significant Prices in Other Significant Outstanding Active Observable Unobservable Measured at (in millions) Balances Markets Inputs Inputs NAV (j) December 31, 2020: Equities: U.S. large cap (a) $ 3,410 $ 2,202 $ — $ — $ 1,208 U.S. mid and small cap (b) 775 721 — 3 51 International (c) 2,654 542 — — 2,112 Fixed income securities: U.S. government securities (d) 475 23 289 — 163 Corporate debt instruments (e) 1,408 425 908 — 75 Non-U.S. government securities (f) 523 16 — — 507 Other (g) 503 159 72 — 272 Absolute return funds (h) 1,618 462 — — 1,156 Cash and Cash Equivalents 281 77 — — 204 Other (i) 724 9 — — 715 $ 12,371 $ 4,636 $ 1,269 $ 3 $ 6,463 December 31, 2019: Equities: U.S. large cap (a) $ 2,873 $ 1,647 $ — $ — $ 1,226 U.S. mid and small cap (b) 648 548 4 2 94 International (c) 2,202 464 — — 1,738 Fixed income securities: U.S. government securities (d) 562 52 357 — 153 Corporate debt instruments (e) 1,266 362 724 — 180 Non-U.S. government securities (f) 445 3 2 — 440 Other (g) 320 69 27 — 224 Absolute return funds (h) 1,557 424 — — 1,133 Cash and Cash Equivalents 182 84 — — 98 Other (i) 582 8 — 1 573 $ 10,637 $ 3,661 $ 1,114 $ 3 $ 5,859 (a) A mix of index funds and actively managed equity accounts that are benchmarked to various large cap indices. (b) A mix of index funds and actively managed equity accounts that are benchmarked to various mid and small cap indices. (c) A mix of index funds and actively managed pooled investment funds that are benchmarked to various non-U.S. equity indices in both developed and emerging markets. (d) A mix of index funds and actively managed accounts that are benchmarked to various U.S. government bond indices. (e) A mix of index funds and actively managed accounts that are benchmarked to various corporate bond indices. (f) Primarily United Kingdom, Japan and Eurozone government bonds. (g) Primarily asset backed securities and an actively managed, diversified fixed income vehicle benchmarked to the one-month Libor / Euribor. (h) Primarily funds invested by managers that have a global mandate with the flexibility to allocate capital broadly across a wide range of asset classes and strategies including, but not limited to equities, fixed income, commodities, interest rate futures, currencies and other securities to outperform an agreed upon benchmark with specific return and volatility targets. (i) Primarily investments in private funds, such as private equity, private credit, private real estate and private energy funds. (j) Investments measured at fair value using the net asset value (NAV) practical expedient have not been classified in the fair value hierarchy. The fair value amounts presented in this table are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the consolidated balance sheet. |
Schedule of total benefit payments expected to be paid to participants | Defined Medical and (in millions) Benefit Plans Dental Plans 2021 $ 340 $ 72 2022 355 73 2023 373 74 2024 395 75 2025 415 76 2026 to 2030 2,410 394 |
Taxes on Earnings from Contin_2
Taxes on Earnings from Continuing Operations (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Taxes on Earnings from Continuing Operations | |
Schedule of earnings from continuing operations before taxes | (in millions) 2020 2019 2018 Earnings From Continuing Operations Before Taxes: Domestic $ 1,588 $ 889 $ (430) Foreign 3,380 3,188 3,303 Total $ 4,968 $ 4,077 $ 2,873 |
Schedule of provisions for taxes on earnings from continuing operations | (in millions) 2020 2019 2018 Taxes on Earnings From Continuing Operations: Current: Domestic $ 39 $ 291 $ (812) Foreign 566 590 606 Total current 605 881 (206) Deferred: Domestic (18) (305) 832 Foreign (90) (186) (87) Total deferred (108) (491) 745 Total $ 497 $ 390 $ 539 |
Schedule of reconciliation of income tax rate and U.S. statutory tax rate to income tax expense (benefit) | 2020 2019 2018 Statutory tax rate on earnings from continuing operations 21.0 % 21.0 % 21.0 % Impact of foreign operations (3.3) (5.0) (5.4) Impact of TCJA and other related items 0.5 (2.1) 6.3 Foreign-derived intangible income benefit (1.0) (2.0) (1.9) Domestic impairment loss (2.7) — (2.1) Excess tax benefits related to stock compensation (1.9) (2.5) (3.1) Research tax credit (1.0) (1.2) (1.8) Resolution of certain tax positions pertaining to prior years (2.8) — 3.4 Intercompany restructurings and integration 0.5 — — State taxes, net of federal benefit 0.5 0.8 0.4 All other, net 0.2 0.6 2.0 Effective tax rate on earnings from continuing operations 10.0 % 9.6 % 18.8 % |
Schedule of components of net deferred tax assets and liabilities | (in millions) 2020 2019 Deferred tax assets: Compensation and employee benefits $ 1,003 $ 982 Other, primarily reserves not currently deductible, and NOL’s and credit carryforwards 2,383 2,378 Trade receivable reserves 196 190 Inventory reserves 146 110 Lease liabilities 259 209 Deferred intercompany profit 254 259 Total deferred tax assets before valuation allowance 4,241 4,128 Valuation allowance (1,060) (978) Total deferred tax assets 3,181 3,150 Deferred tax liabilities: Depreciation (297) (219) Right of Use lease assets (251) (209) Other, primarily the excess of book basis over tax basis of intangible assets (2,876) (3,258) Total deferred tax liabilities (3,424) (3,686) Total net deferred tax assets (liabilities) $ (243) $ (536) |
Schedule of reconciliation of unrecognized tax benefits for the period | (in millions) 2020 2019 January 1 $ 1,175 $ 1,120 Increase due to current year tax positions 190 137 Increase due to prior year tax positions 97 75 Decrease due to prior year tax positions (144) (117) Settlements (27) (32) Lapse of statute (81) (8) December 31 $ 1,210 $ 1,175 |
Segment and Geographic Area I_2
Segment and Geographic Area Information (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Segment and Geographic Area Information | |
Schedule of segment information - net sales and operating earnings | Net Sales to External Customers (a) Operating Earnings (a) (in millions) 2020 2019 2018 2020 2019 2018 Established Pharmaceutical Products $ 4,303 $ 4,486 $ 4,422 $ 794 $ 904 $ 894 Nutritional Products 7,647 7,409 7,229 1,751 1,705 1,652 Diagnostic Products 10,805 7,713 7,495 3,725 1,912 1,868 Medical Devices 11,787 12,239 11,370 3,038 3,769 3,500 Total Reportable Segments 34,542 31,847 30,516 $ 9,308 $ 8,290 $ 7,914 Other 66 57 62 Total $ 34,608 $ 31,904 $ 30,578 (a) Net sales and operating earnings were unfavorably affected by the impact of foreign exchange in 2020, 2019 and 2018. |
Schedule of reconciliation of operating earnings to earnings from continuing operations | (in millions) 2020 2019 2018 Total Reportable Segment Operating Earnings $ 9,308 $ 8,290 $ 7,914 Corporate functions and benefit plan costs (518) (468) (618) Net interest expense (500) (576) (721) Loss on extinguishment of debt — (63) (167) Share-based compensation (546) (519) (477) Amortization of intangible assets (2,132) (1,936) (2,178) Other, net (b) (644) (651) (880) Earnings from Continuing Operations Before Taxes $ 4,968 $ 4,077 $ 2,873 (b) Other, net includes integration costs associated with the acquisition of St. Jude Medical and Alere and restructuring charges in 2020, 2019 and 2018. Other, net in 2020 also includes costs related to asset impairments, partially offset by income from the settlement of litigation. Other, net in 2018 also includes inventory step-up amortization associated with the acquisition of Alere. Charges for restructuring actions and other cost reduction initiatives were approximately $125 million in 2020, $215 million in 2019 and $153 million in 2018. |
Schedule of depreciation, additions to property and equipment and total assets by segment | Additions to Depreciation Property and Equipment Total Assets (in millions) 2020 2019 2018 2020 2019 2018 2020 2019 2018 Established Pharmaceuticals $ 88 $ 98 $ 92 $ 109 $ 109 $ 131 $ 2,888 $ 2,858 $ 2,664 Nutritionals 143 139 150 201 141 86 3,478 3,274 3,071 Diagnostics 488 403 397 1,263 726 609 7,696 5,235 4,464 Medical Devices 281 266 294 402 532 408 6,893 6,640 5,886 Total Reportable Segments 1,000 906 933 1,975 1,508 1,234 $ 20,955 $ 18,007 $ 16,085 Other 195 172 167 218 160 160 Total $ 1,195 $ 1,078 $ 1,100 $ 2,193 $ 1,668 $ 1,394 |
Schedule of reconciliation of segment assets to total assets | (in millions) 2020 2019 2018 Total Reportable Segment Assets $ 20,955 $ 18,007 $ 16,085 Cash and investments 7,969 5,023 4,983 Goodwill and intangible assets 38,528 40,220 42,196 All other 5,096 4,637 3,909 Total Assets $ 72,548 $ 67,887 $ 67,173 |
Schedule of net sales to external customers by geographic areas | Net Sales to External Customers (c) (in millions) 2020 2019 2018 United States $ 13,022 $ 11,398 $ 10,839 Germany 2,108 1,751 1,619 China 1,965 2,346 2,311 Japan 1,386 1,435 1,326 India 1,323 1,397 1,333 Switzerland 1,140 1,068 1,005 The Netherlands 1,084 975 930 All Other Countries 12,580 11,534 11,215 Consolidated $ 34,608 $ 31,904 $ 30,578 (c) |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Earnings Per Share (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
EARNINGS PER SHARE | |||
Earnings from continuing operations allocated to common shares | $ 4,449 | $ 3,666 | $ 2,320 |
Net earnings allocated to common shares | $ 4,473 | $ 3,666 | $ 2,353 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Pensions (Details) | 12 Months Ended |
Dec. 31, 2020 | |
PENSION AND POST EMPLOYMENT BENEFITS | |
Amortization period of differences between the expected long-term return on plan assets and the actual return | 5 years |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Cash, Cash Equivalents And Investments (Details) $ in Millions | Dec. 31, 2020USD ($) |
CASH, CASH EQUIVALENTS AND INVESTMENTS | |
Equity method investments carrying value | $ 277 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Property and Equipment (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Buildings | Minimum | |
PROPERTY AND EQUIPMENT | |
Estimated Useful Lives | 10 years |
Buildings | Maximum | |
PROPERTY AND EQUIPMENT | |
Estimated Useful Lives | 50 years |
Equipment | Minimum | |
PROPERTY AND EQUIPMENT | |
Estimated Useful Lives | 2 years |
Equipment | Maximum | |
PROPERTY AND EQUIPMENT | |
Estimated Useful Lives | 20 years |
New Accounting Standards (Detai
New Accounting Standards (Details) $ in Millions | 3 Months Ended |
Dec. 31, 2018USD ($) | |
ASU 2018-02 | |
Recently Adopted Accounting Standards | |
Accumulated other comprehensive income (loss) to retained earnings stranded tax effects | $ 337 |
Revenue (Details)
Revenue (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020USD ($)segment | Dec. 31, 2019USD ($)segment | Dec. 31, 2018USD ($)segment | |
Revenue | |||
Number of reportable segments | segment | 4 | 4 | 4 |
Net sales | $ 34,608 | $ 31,904 | $ 30,578 |
Minimum | |||
Revenue | |||
Settlement of rebate after sale | 1 month | ||
Period cash discounts are known after sale | 15 days | ||
Maximum | |||
Revenue | |||
Settlement of rebate after sale | 6 months | ||
Period cash discounts are known after sale | 30 days | ||
U.S. | |||
Revenue | |||
Net sales | $ 13,022 | 11,398 | 10,839 |
Int'l | |||
Revenue | |||
Net sales | 21,586 | 20,506 | 19,739 |
Established Pharmaceutical Products | |||
Revenue | |||
Net sales | 4,303 | 4,486 | 4,422 |
Established Pharmaceutical Products | Int'l | |||
Revenue | |||
Net sales | 4,303 | 4,486 | 4,422 |
Nutritional Products | |||
Revenue | |||
Net sales | 7,647 | 7,409 | 7,229 |
Nutritional Products | U.S. | |||
Revenue | |||
Net sales | 3,279 | 3,110 | 3,075 |
Nutritional Products | Int'l | |||
Revenue | |||
Net sales | 4,368 | 4,299 | 4,154 |
Diagnostic Products | |||
Revenue | |||
Net sales | 10,805 | 7,713 | 7,495 |
Diagnostic Products | U.S. | |||
Revenue | |||
Net sales | 4,774 | 2,887 | 2,717 |
Diagnostic Products | Int'l | |||
Revenue | |||
Net sales | 6,031 | 4,826 | 4,778 |
Medical Devices | |||
Revenue | |||
Net sales | 11,787 | 12,239 | 11,370 |
Medical Devices | U.S. | |||
Revenue | |||
Net sales | 4,931 | 5,374 | 5,011 |
Medical Devices | Int'l | |||
Revenue | |||
Net sales | 6,856 | 6,865 | 6,359 |
Other | |||
Revenue | |||
Net sales | 66 | 57 | 62 |
Key Emerging Markets | Established Pharmaceutical Products | |||
Revenue | |||
Net sales | 3,209 | 3,392 | 3,363 |
Key Emerging Markets | Established Pharmaceutical Products | Int'l | |||
Revenue | |||
Net sales | 3,209 | 3,392 | 3,363 |
Other | Established Pharmaceutical Products | |||
Revenue | |||
Net sales | 1,094 | 1,094 | 1,059 |
Other | Established Pharmaceutical Products | Int'l | |||
Revenue | |||
Net sales | 1,094 | 1,094 | 1,059 |
Other | Other | |||
Revenue | |||
Net sales | 66 | 57 | 62 |
Other | Other | U.S. | |||
Revenue | |||
Net sales | 38 | 27 | 36 |
Other | Other | Int'l | |||
Revenue | |||
Net sales | 28 | 30 | 26 |
Pediatric Nutritionals | Nutritional Products | |||
Revenue | |||
Net sales | 4,127 | 4,161 | 4,097 |
Pediatric Nutritionals | Nutritional Products | U.S. | |||
Revenue | |||
Net sales | 1,987 | 1,879 | 1,843 |
Pediatric Nutritionals | Nutritional Products | Int'l | |||
Revenue | |||
Net sales | 2,140 | 2,282 | 2,254 |
Adult Nutritionals | Nutritional Products | |||
Revenue | |||
Net sales | 3,520 | 3,248 | 3,132 |
Adult Nutritionals | Nutritional Products | U.S. | |||
Revenue | |||
Net sales | 1,292 | 1,231 | 1,232 |
Adult Nutritionals | Nutritional Products | Int'l | |||
Revenue | |||
Net sales | 2,228 | 2,017 | 1,900 |
Core Laboratory | Diagnostic Products | |||
Revenue | |||
Net sales | 4,475 | 4,656 | 4,386 |
Core Laboratory | Diagnostic Products | U.S. | |||
Revenue | |||
Net sales | 1,166 | 1,086 | 985 |
Core Laboratory | Diagnostic Products | Int'l | |||
Revenue | |||
Net sales | 3,309 | 3,570 | 3,401 |
Molecular | Diagnostic Products | |||
Revenue | |||
Net sales | 1,438 | 442 | 484 |
Molecular | Diagnostic Products | U.S. | |||
Revenue | |||
Net sales | 621 | 149 | 152 |
Molecular | Diagnostic Products | Int'l | |||
Revenue | |||
Net sales | 817 | 293 | 332 |
Point of Care | Diagnostic Products | |||
Revenue | |||
Net sales | 516 | 561 | 553 |
Point of Care | Diagnostic Products | U.S. | |||
Revenue | |||
Net sales | 369 | 438 | 432 |
Point of Care | Diagnostic Products | Int'l | |||
Revenue | |||
Net sales | 147 | 123 | 121 |
Rapid Diagnostics | Diagnostic Products | |||
Revenue | |||
Net sales | 4,376 | 2,054 | 2,072 |
Rapid Diagnostics | Diagnostic Products | U.S. | |||
Revenue | |||
Net sales | 2,618 | 1,214 | 1,148 |
Rapid Diagnostics | Diagnostic Products | Int'l | |||
Revenue | |||
Net sales | 1,758 | 840 | 924 |
Rhythm Management | Medical Devices | |||
Revenue | |||
Net sales | 1,914 | 2,144 | 2,198 |
Rhythm Management | Medical Devices | U.S. | |||
Revenue | |||
Net sales | 903 | 1,057 | 1,105 |
Rhythm Management | Medical Devices | Int'l | |||
Revenue | |||
Net sales | 1,011 | 1,087 | 1,093 |
Electrophysiology | Medical Devices | |||
Revenue | |||
Net sales | 1,578 | 1,721 | 1,561 |
Electrophysiology | Medical Devices | U.S. | |||
Revenue | |||
Net sales | 660 | 742 | 678 |
Electrophysiology | Medical Devices | Int'l | |||
Revenue | |||
Net sales | 918 | 979 | 883 |
Heart Failure | Medical Devices | |||
Revenue | |||
Net sales | 740 | 769 | 646 |
Heart Failure | Medical Devices | U.S. | |||
Revenue | |||
Net sales | 547 | 574 | 467 |
Heart Failure | Medical Devices | Int'l | |||
Revenue | |||
Net sales | 193 | 195 | 179 |
Vascular | Medical Devices | |||
Revenue | |||
Net sales | 2,339 | 2,850 | 2,929 |
Vascular | Medical Devices | U.S. | |||
Revenue | |||
Net sales | 853 | 1,047 | 1,126 |
Vascular | Medical Devices | Int'l | |||
Revenue | |||
Net sales | 1,486 | 1,803 | 1,803 |
Structural Heart | Medical Devices | |||
Revenue | |||
Net sales | 1,247 | 1,400 | 1,239 |
Structural Heart | Medical Devices | U.S. | |||
Revenue | |||
Net sales | 540 | 616 | 488 |
Structural Heart | Medical Devices | Int'l | |||
Revenue | |||
Net sales | 707 | 784 | 751 |
Neuromodulation | Medical Devices | |||
Revenue | |||
Net sales | 702 | 831 | 864 |
Neuromodulation | Medical Devices | U.S. | |||
Revenue | |||
Net sales | 564 | 660 | 690 |
Neuromodulation | Medical Devices | Int'l | |||
Revenue | |||
Net sales | 138 | 171 | 174 |
Diabetes Care | Medical Devices | |||
Revenue | |||
Net sales | 3,267 | 2,524 | 1,933 |
Diabetes Care | Medical Devices | U.S. | |||
Revenue | |||
Net sales | 864 | 678 | 457 |
Diabetes Care | Medical Devices | Int'l | |||
Revenue | |||
Net sales | $ 2,403 | $ 1,846 | $ 1,476 |
Revenue - Remaining Performance
Revenue - Remaining Performance Obligations (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Diagnostic Products | |
Remaining Performance Obligations | |
Remaining performance obligations | $ 3,800 |
Medical Devices | |
Remaining Performance Obligations | |
Remaining performance obligations | $ 430 |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-01-01 | |
Remaining Performance Obligations | |
Expected timing of satisfication period (in months) | 24 months |
Percentage of remaining performance obligation expected to be recognized in period | 60.00% |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2023-01-01 | |
Remaining Performance Obligations | |
Expected timing of satisfication period (in months) | 12 months |
Percentage of remaining performance obligation expected to be recognized in period | 17.00% |
Revenue - Practical Expedient (
Revenue - Practical Expedient (Details) | 12 Months Ended |
Dec. 31, 2020 | |
Revenue | |
Practical expedient in remaining performance obligations related to contracts | true |
Practical expedient in incremental costs of obtaining contracts with customers | true |
Revenue, practical expedient, initial application and transition, completed contract, same reporting period | true |
Revenue - Assets Recognized for
Revenue - Assets Recognized for Costs to Obtain a Contract with a Customer (Details) | Dec. 31, 2020 |
Capitalized commission fees | Minimum | |
Assets Recognized for Costs to Obtain a Contract with a Customer | |
Amortization period | 2 years |
Capitalized commission fees | Maximum | |
Assets Recognized for Costs to Obtain a Contract with a Customer | |
Amortization period | 10 years |
Capitalized transmitter costs | Minimum | |
Assets Recognized for Costs to Obtain a Contract with a Customer | |
Amortization period | 8 years |
Capitalized transmitter costs | Maximum | |
Assets Recognized for Costs to Obtain a Contract with a Customer | |
Amortization period | 10 years |
Revenue - Other Contract Assets
Revenue - Other Contract Assets and Liabilities (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Contract Liabilities | ||
Balance at beginning of period | $ 294 | $ 259 |
Unearned revenue from cash received during the period | 505 | 411 |
Revenue recognized related to contract liability balance | (394) | (376) |
Balance at end of period | $ 405 | $ 294 |
Discontinued Operations and B_2
Discontinued Operations and Business Dispositions - Summary (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2018 | |
Financial information for discontinued operations | ||
Income tax benefits | $ 24 | $ 39 |
Supplemental Financial Inform_3
Supplemental Financial Information - Other income and expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Other (income) expense, net | |||
Disclosures | |||
Income related to non-service cost component of net periodic benefit cost | $ 205 | $ 225 | $ 160 |
Supplemental Financial Inform_4
Supplemental Financial Information - Allowance for Doubtful Accounts (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2020USD ($) | |
Allowances for Doubtful Accounts and Product Returns | |
Balance at December 31, 2019 | $ 228 |
Provisions/charges to income | 88 |
Amounts charged off and other deductions | (35) |
Balance at December 31, 2020 | 288 |
Impact of adoption of new accounting standards | ASU 2016-13 | |
Allowances for Doubtful Accounts and Product Returns | |
Balance at December 31, 2020 | $ 7 |
Supplemental Financial Inform_5
Supplemental Financial Information - Investments (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2018 | Dec. 31, 2019 | |
Investments | |||
Long-term Investments | $ 821 | $ 883 | |
Impairment of investments | 115 | ||
Additional investments | 35 | ||
Equity method investments carrying value | 277 | ||
Equity securities | |||
Investments | |||
Long-term Investments | 776 | 836 | |
Other | |||
Investments | |||
Long-term Investments | 45 | 47 | |
Impairment of investments | 60 | ||
Equity investment without readily determinable fair value | 113 | ||
Unrealized gain | $ 50 | ||
St Jude Medical | Equity securities | |||
Investments | |||
Securities in mutual funds held in a rabbi trust | $ 366 | $ 346 |
Supplemental Financial Inform_6
Supplemental Financial Information - Acquired R&D (Details) - Cephea Valve Technologies, Inc $ in Millions | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Business acquisition | |
Research & development (R&D) asset | $ 102 |
Research & development expense | $ 102 |
Supplemental Financial Inform_7
Supplemental Financial Information - Other accrued liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Other Accrued Liabilities: | ||
Accrued rebates payable to government agencies | $ 316 | $ 212 |
Accrued other rebates | 805 | 655 |
All other | 4,044 | 3,168 |
Total | 5,165 | 4,035 |
Accrued wholesaler chargeback rebates | $ 178 | $ 175 |
Supplemental Financial Inform_8
Supplemental Financial Information - Post-employment obligations and other long-term liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Post-employment Obligations and Other Long-term Liabilities: | |||
Defined benefit pension plans and post-employment medical and dental plans for significant plans | $ 3,119 | $ 2,817 | |
Deferred income taxes | 1,406 | 1,546 | |
Operating lease liabilities | 902 | 755 | |
All other | 3,684 | 3,944 | |
Total | 9,111 | 9,062 | |
All other disclosures | |||
Net unrecognized tax benefits from acquisition | 1,210 | 1,175 | $ 1,120 |
All other | |||
All other disclosures | |||
Net unrecognized tax benefits from acquisition | $ 740 | $ 580 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Changes in accumulated other comprehensive income (loss), net of income taxes | |||
Beginning of the period | $ 31,088 | ||
Other Comprehensive Income (Loss) | (481) | $ (879) | $ (1,192) |
End of the period | 32,784 | 31,088 | |
Accumulated Other Comprehensive Income (Loss): | |||
Changes in accumulated other comprehensive income (loss), net of income taxes | |||
Beginning of the period | (8,465) | (7,586) | |
Other comprehensive income (loss) before reclassifications | (598) | (729) | |
(Income) loss amounts reclassified from accumulated other comprehensive income | 117 | (150) | |
Other Comprehensive Income (Loss) | (481) | (879) | (1,192) |
End of the period | (8,946) | (8,465) | (7,586) |
Cumulative Foreign Currency Translation Adjustments | |||
Changes in accumulated other comprehensive income (loss), net of income taxes | |||
Beginning of the period | (4,924) | (4,912) | |
Other comprehensive income (loss) before reclassifications | 65 | (12) | |
Other Comprehensive Income (Loss) | 65 | (12) | |
End of the period | (4,859) | (4,924) | (4,912) |
Net Actuarial (Losses) and Prior Service (Costs) and Credits | |||
Changes in accumulated other comprehensive income (loss), net of income taxes | |||
Beginning of the period | (3,540) | (2,726) | |
Other comprehensive income (loss) before reclassifications | (523) | (719) | |
(Income) loss amounts reclassified from accumulated other comprehensive income | 192 | (95) | |
Other Comprehensive Income (Loss) | (331) | (814) | |
End of the period | (3,871) | (3,540) | (2,726) |
Cumulative Gains (Losses) on Derivative Instruments Designated as Cash Flow Hedges | |||
Changes in accumulated other comprehensive income (loss), net of income taxes | |||
Beginning of the period | (1) | 52 | |
Other comprehensive income (loss) before reclassifications | (140) | 2 | |
(Income) loss amounts reclassified from accumulated other comprehensive income | (75) | (55) | |
Other Comprehensive Income (Loss) | (215) | (53) | |
End of the period | $ (216) | $ (1) | $ 52 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets - Goodwill (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill and Intangible Assets | ||
Goodwill | $ 23,744 | $ 23,195 |
Increase (decrease) in goodwill due to foreign currency translation adjustments | 550 | (103) |
Amount of reductions of goodwill relating to impairments | 0 | $ 0 |
Established Pharmaceutical Products | ||
Goodwill and Intangible Assets | ||
Goodwill | 3,000 | |
Nutritional Products | ||
Goodwill and Intangible Assets | ||
Goodwill | 286 | |
Diagnostic Products | ||
Goodwill and Intangible Assets | ||
Goodwill | 3,800 | |
Medical Devices | ||
Goodwill and Intangible Assets | ||
Goodwill | $ 16,600 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Intangible Assets (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill and Intangible Assets | ||
Gross amount of amortizable intangible assets | $ 27,800 | $ 27,600 |
Accumulated amortization of intangible assets | 14,200 | 11,900 |
Increase (Decrease) in intangible assets due to foreign currency translation adjustments | 67 | (71) |
Estimated annual amortization expense, intangible assets, 2021 | 2,000 | |
Estimated annual amortization expense, intangible assets, 2022 | 2,000 | |
Estimated annual amortization expense, intangible assets, 2023 | 1,900 | |
Estimated annual amortization expense, intangible assets, 2024 | 1,900 | |
Estimated annual amortization expense, intangible assets, 2025 | 1,900 | |
Indefinite-lived intangible assets related to in-process R&D acquired in a business combination | 1,200 | $ 1,300 |
Medical Devices | ||
Goodwill and Intangible Assets | ||
Impairment of indefinite-lived intangible assets in-process research and development project | 55 | |
Impairment of amortizable intangible assets | $ 148 | |
Minimum | ||
Goodwill and Intangible Assets | ||
Amortization period of intangible assets | 2 years | |
Maximum | ||
Goodwill and Intangible Assets | ||
Amortization period of intangible assets | 20 years |
Restructuring Plans (Details)
Restructuring Plans (Details) - USD ($) $ in Millions | 12 Months Ended | 36 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2020 | Dec. 31, 2017 | |
Restructuring costs | |||||
Accrued balance at end of period | $ 70 | $ 79 | $ 70 | $ 70 | $ 119 |
Restructuring Plan from 2017 to 2020, St Jude and Alere Integrations | |||||
Restructuring costs | |||||
Accrued balance at end of period | 25 | 25 | $ 68 | ||
Employee related severance and other charges | 13 | 72 | 52 | 137 | |
Restructuring Plan from 2017 to 2020, St Jude and Alere Integrations | Cost of products sold | |||||
Restructuring costs | |||||
Employee related severance and other charges | 30 | ||||
Restructuring Plan from 2017 to 2020, St Jude and Alere Integrations | Research and development | |||||
Restructuring costs | |||||
Employee related severance and other charges | 15 | ||||
Restructuring Plan from 2017 to 2020, St Jude and Alere Integrations | Selling, general and administrative expense | |||||
Restructuring costs | |||||
Employee related severance and other charges | $ 92 | ||||
Restructuring Plan from 2016 to 2020 | |||||
Restructuring costs | |||||
Employee related severance and other charges | 36 | 66 | 28 | ||
Restructuring Plan from 2016 to 2020 | Cost of products sold | |||||
Restructuring costs | |||||
Employee related severance and other charges | 6 | 16 | 10 | ||
Restructuring Plan from 2016 to 2020 | Research and development | |||||
Restructuring costs | |||||
Employee related severance and other charges | 2 | 28 | 2 | ||
Restructuring Plan from 2016 to 2020 | Selling, general and administrative expense | |||||
Restructuring costs | |||||
Employee related severance and other charges | $ 28 | $ 22 | $ 16 |
Restructuring Plans - Table (De
Restructuring Plans - Table (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Restructuring Plans | |||
Accrued balance at beginning of the period | $ 79 | $ 70 | $ 119 |
Restructuring charges | 36 | 66 | 28 |
Payments and other adjustments | (45) | (57) | (77) |
Accrued balance at end of the period | $ 70 | $ 79 | $ 70 |
Incentive Stock Programs - Gene
Incentive Stock Programs - General (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Apr. 30, 2017 | |
Incentive Stock Program | |||
Total unrecognized compensation cost | $ 407 | ||
Total unrecognized compensation cost, recognition period | 3 years | ||
Stock options | |||
Incentive Stock Program | |||
Stock options granted during the period (in shares) | 4,015,420 | ||
Award vesting period | 3 years | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price | $ 55.65 | $ 48.78 | |
Stock options | Maximum | |||
Incentive Stock Program | |||
Maximum term of option | 10 years | ||
Restricted stock awards | |||
Incentive Stock Program | |||
Award vesting period | 3 years | ||
Portion of awards vesting in any one year for awards that vest over 5 years (as a percent) | 33.00% | ||
For awards with a term of five years, number of years in which no more than one-third of the award vests | 1 year | ||
Restricted stock units | |||
Incentive Stock Program | |||
Award vesting period | 3 years | ||
Number of shares of common stock received for each vested restricted stock unit (in shares) | 1 | ||
2017 Incentive Stock Program | |||
Incentive Stock Program | |||
Incentive stock programs, shares authorized for issuance | 170,000,000 | ||
Incentive stock programs, shares reserved for future issuance | 113,000,000 | ||
2017 Incentive Stock Program | Stock options | |||
Incentive Stock Program | |||
Stock options granted during the period (in shares) | 4,015,420 | ||
2017 Incentive Stock Program | Restricted stock awards | |||
Incentive Stock Program | |||
Grants in period, restricted stock (in shares) | 569,961 | ||
2017 Incentive Stock Program | Restricted stock units | |||
Incentive Stock Program | |||
Awards and units granted during period (in shares) | 5,239,575 |
Incentive Stock Programs - Opti
Incentive Stock Programs - Option Activity (Details) - Stock options - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Stock Options Outstanding During The Period | |||
Stock options outstanding at the beginning of the period (in shares) | 29,877,915 | ||
Stock options granted during the period (in shares) | 4,015,420 | ||
Stock options exercised during the period (in shares) | (4,872,830) | ||
Stock options lapsed during the period (in shares) | (100,619) | ||
Stock options outstanding at the end of the period (in shares) | 28,919,886 | 29,877,915 | |
Exercisable options outstanding at the end of the period (in shares) | 20,390,745 | ||
Stock Options Weighted Average Exercise Price | |||
Stock options outstanding at the beginning of the period, weighted-average exercise price (in dollars per share) | $ 48.78 | ||
Stock options granted during the period, weighted-average exercise price (in dollars per share) | 87.84 | ||
Stock options exercised during the period, weighted-average exercise price (in dollars per share) | 39.62 | ||
Stock options lapsed during the period, weighted-average exercise price (in dollars per share) | 75.22 | ||
Stock options outstanding at the end of the period, weighted-average exercise price (in dollars per share) | 55.65 | $ 48.78 | |
Exercisable options outstanding weighted-average exercise price at the end of the period (in dollars per share) | $ 46.16 | ||
Stock Options Weighted Average Remaining Life (Years) | |||
Stock options outstanding, weighted-average remaining life | 6 years | 6 years 2 months 12 days | |
Exercisable options, weighted-average remaining life | 5 years | ||
Aggregate Intrinsic Value | |||
Aggregate intrinsic value of options outstanding | $ 1,557 | $ 1,138 | |
Aggregate intrinsic value of options exercisable | 1,291 | ||
Total intrinsic value of options exercised | $ 279 | $ 315 | $ 249 |
Incentive Stock Program - Restr
Incentive Stock Program - Restricted Awards and Units (Details) - Restricted stock awards and restricted stock units - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share Units | |||
Awards and units outstanding (in shares) | 14,463,314 | ||
Awards and units granted during period (in shares) | 5,809,536 | ||
Awards and units vested during period (in shares) | (7,167,631) | ||
Awards and units forfeited during period (in shares) | (612,351) | ||
Awards and units outstanding (in shares) | 12,492,868 | 14,463,314 | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |||
Awards and units outstanding, weighted-average grant-date fair value (in dollars per share) | $ 65.51 | ||
Awards and units granted during period, weighted-average grant-date fair value (in dollars per share) | 87.83 | ||
Awards and units vested during period, weighted-average grant-date fair value (in dollars per share) | 60.67 | ||
Awards and units forfeited during period, weighted-average grant-date fair value (in dollars per share) | 75.16 | ||
Awards and units outstanding, weighted-average grant-date fair value (in dollars per share) | $ 78.19 | $ 65.51 | |
Fair value of awards and units vested | $ 631 | $ 588 | $ 458 |
Incentive Stock Program - Expen
Incentive Stock Program - Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Incentive Stock Programs | |||
Total non-cash compensation expense charged against income | $ 546 | $ 519 | $ 477 |
Tax benefit recognized in total non-cash compensation expense | $ 200 | $ 197 | $ 185 |
Incentive Stock Program - Optio
Incentive Stock Program - Options Fair Value (Details) - Stock options - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Incentive Stock Program | |||
Fair value of an option granted (in dollars per share) | $ 14.39 | $ 14.50 | $ 10.93 |
Fair value assumptions: | |||
Risk-free interest rate (as a percent) | 1.30% | 2.50% | 2.70% |
Average life of options (years) | 6 years | 6 years | 6 years |
Volatility (as a percent) | 19.40% | 19.80% | 19.00% |
Dividend yield (as a percent) | 1.60% | 1.70% | 1.90% |
Debt and Lines of Credit - Sche
Debt and Lines of Credit - Schedule (Details) - USD ($) $ in Millions | Nov. 12, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Sep. 28, 2020 | Jun. 24, 2020 | Oct. 31, 2018 | Oct. 28, 2018 |
Debt and Lines of Credit | |||||||
Unamortized debt issuance costs | $ (87) | $ (90) | |||||
Other, including fair value adjustments relating to interest rate hedge contracts designated as fair value hedges | 144 | (6) | |||||
Total carrying amount of long-term debt | 18,534 | 17,938 | |||||
Less: Current portion | 7 | 1,277 | |||||
Total long-term portion | 18,527 | 16,661 | |||||
2020 Five Year Credit Agreement | |||||||
Debt and Lines of Credit | |||||||
Credit agreement term | 5 years | ||||||
0.00% Notes, due 2020 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 1,272 | ||||||
Interest rate percentage | 0.00% | 0.00% | |||||
2.55% Notes, due 2022 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 750 | $ 750 | |||||
Interest rate percentage | 2.55% | 2.55% | |||||
0.875% Notes, due 2023 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 1,398 | $ 1,272 | |||||
Interest rate percentage | 0.875% | 0.875% | |||||
3.40% Notes, due 2023 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 1,050 | $ 1,050 | |||||
Interest rate percentage | 3.40% | 3.40% | 3.40% | 3.40% | |||
5-year term loan due 2024 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 577 | $ 546 | |||||
Credit agreement term | 5 years | 5 years | |||||
0.10% Notes, due 2024 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 724 | $ 658 | |||||
Interest rate percentage | 0.10% | 0.10% | |||||
3.875% Notes, due 2025 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 500 | $ 500 | |||||
Interest rate percentage | 3.875% | 3.875% | |||||
2.95% Notes, due 2025 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 1,000 | $ 1,000 | |||||
Interest rate percentage | 2.95% | 2.95% | |||||
1.50% Notes, due 2026 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 1,398 | $ 1,272 | |||||
Interest rate percentage | 1.50% | 1.50% | |||||
3.75% Notes, due 2026 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 1,700 | $ 1,700 | |||||
Interest rate percentage | 3.75% | 3.75% | 3.75% | 3.75% | |||
0.375% Notes, due 2027 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 724 | $ 658 | |||||
Interest rate percentage | 0.375% | 0.375% | |||||
1.150% Notes due 2028 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 650 | ||||||
Interest rate percentage | 1.15% | 1.15% | |||||
1.400% Notes due 2030 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 650 | ||||||
Interest rate percentage | 1.40% | 1.40% | |||||
4.75% Notes, due 2036 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 1,650 | $ 1,650 | |||||
Interest rate percentage | 4.75% | 4.75% | |||||
6.15% Notes, due 2037 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 547 | $ 547 | |||||
Interest rate percentage | 6.15% | 6.15% | |||||
6.00% Notes, due 2039 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 515 | $ 515 | |||||
Interest rate percentage | 6.00% | 6.00% | |||||
5.30% Notes, due 2040 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 694 | $ 694 | |||||
Interest rate percentage | 5.30% | 5.30% | |||||
4.75% Notes, due 2043 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 700 | $ 700 | |||||
Interest rate percentage | 4.75% | 4.75% | |||||
4.90% Notes, due 2046 | |||||||
Debt and Lines of Credit | |||||||
Total long-term portion | $ 3,250 | $ 3,250 | |||||
Interest rate percentage | 4.90% | 4.90% |
Debt and Lines of Credit - Debt
Debt and Lines of Credit - Debt issuances and redemptions (Details) € in Millions, ¥ in Billions | Nov. 12, 2020USD ($) | Sep. 28, 2020USD ($) | Sep. 28, 2020EUR (€) | Dec. 19, 2019USD ($) | Nov. 21, 2019USD ($) | Nov. 21, 2019JPY (¥) | Nov. 19, 2019USD ($) | Feb. 24, 2019USD ($) | Oct. 28, 2018USD ($) | Sep. 28, 2018USD ($) | Sep. 27, 2018USD ($) | Sep. 17, 2018USD ($) | Jun. 22, 2018USD ($) | Mar. 22, 2018USD ($) | Feb. 16, 2018USD ($) | Jan. 05, 2018USD ($) | Nov. 30, 2019USD ($) | Nov. 30, 2019JPY (¥) | Sep. 30, 2019USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Jun. 24, 2020USD ($) | Nov. 19, 2019EUR (€) | Oct. 31, 2018 | Sep. 27, 2018EUR (€) |
Debt and Lines of Credit | ||||||||||||||||||||||||||
Proceeds from issuance of long-term debt | $ 1,281,000,000 | $ 1,842,000,000 | $ 4,009,000,000 | |||||||||||||||||||||||
Loss on extinguishment of debt | $ 63,000,000 | $ 167,000,000 | ||||||||||||||||||||||||
Long-term notes authorized for redemption | $ 5,000,000,000 | $ 5,000,000,000 | ||||||||||||||||||||||||
Amount remaining available for redemption under the redemption authorization | $ 2,150,000,000 | |||||||||||||||||||||||||
Revolving credit agreement | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Repayments of debt | $ 1,150,000,000 | |||||||||||||||||||||||||
2018 Five Year Credit Agreement | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Amount outstanding | $ 0 | |||||||||||||||||||||||||
2020 Five Year Credit Agreement | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Maximum borrowing capacity | $ 5,000,000,000 | |||||||||||||||||||||||||
Maturity period | 5 years | |||||||||||||||||||||||||
Senior Notes | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Debt issued - principal amount | $ 1,300,000,000 | |||||||||||||||||||||||||
1.150% Notes due 2028 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Debt issued - principal amount | $ 650,000,000 | |||||||||||||||||||||||||
Interest rate percentage | 1.15% | 1.15% | ||||||||||||||||||||||||
1.400% Notes due 2030 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Debt issued - principal amount | $ 650,000,000 | |||||||||||||||||||||||||
Interest rate percentage | 1.40% | 1.40% | ||||||||||||||||||||||||
0.00% Notes, due 2020 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Interest rate percentage | 0.00% | 0.00% | 0.00% | |||||||||||||||||||||||
Repayments of debt | $ 1,300,000,000 | € 1,140 | ||||||||||||||||||||||||
5-year term loan agreement | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Repayments of debt | $ 2,800,000,000 | |||||||||||||||||||||||||
Maturity period | 5 years | |||||||||||||||||||||||||
Yen-denominated long-term debt | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Maturity period | 5 years | 5 years | ||||||||||||||||||||||||
Proceeds from issuance of long-term debt | $ 550,000,000 | ¥ 59.8 | $ 550,000,000 | ¥ 59.8 | ||||||||||||||||||||||
5.125% Notes, due 2019 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Interest rate percentage | 5.125% | |||||||||||||||||||||||||
Repayments of debt | $ 947,000,000 | |||||||||||||||||||||||||
2.35% Notes, due 2019 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Interest rate percentage | 2.35% | 2.35% | 2.35% | |||||||||||||||||||||||
Repayments of debt | $ 495,000,000 | $ 1,300,000,000 | $ 1,055,000,000 | |||||||||||||||||||||||
Loss on extinguishment of debt | 14,000,000 | |||||||||||||||||||||||||
Outstanding principal amount | $ 1,795,000,000 | $ 2,850,000,000 | ||||||||||||||||||||||||
2.80% Notes, due 2020 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Interest rate percentage | 2.80% | |||||||||||||||||||||||||
Repayments of debt | $ 500,000,000 | |||||||||||||||||||||||||
2.0% Notes, due 2018 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Interest rate percentage | 2.00% | |||||||||||||||||||||||||
Repayments of debt | $ 500,000,000 | |||||||||||||||||||||||||
Long-term Debt | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Repayments of debt | $ 4,000,000,000 | |||||||||||||||||||||||||
2.00% Notes, due 2020 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Interest rate percentage | 2.00% | |||||||||||||||||||||||||
Repayments of debt | $ 750,000,000 | |||||||||||||||||||||||||
4.125% Notes, due 2020 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Interest rate percentage | 4.125% | |||||||||||||||||||||||||
Repayments of debt | $ 597,000,000 | |||||||||||||||||||||||||
3.25% Notes due 2023 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Interest rate percentage | 3.25% | |||||||||||||||||||||||||
Repayments of debt | $ 900,000,000 | |||||||||||||||||||||||||
3.40% Note due in 2023 and the 3.75% Note due in 2026 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Unwound interest rate swaps | $ 1,100,000,000 | |||||||||||||||||||||||||
3.40% Notes, due 2023 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Interest rate percentage | 3.40% | 3.40% | 3.40% | 3.40% | ||||||||||||||||||||||
Repayments of debt | $ 450,000,000 | |||||||||||||||||||||||||
3.75% Notes, due 2026 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Interest rate percentage | 3.75% | 3.75% | 3.75% | 3.75% | ||||||||||||||||||||||
Repayments of debt | $ 1,300,000,000 | |||||||||||||||||||||||||
2.9% Notes, due 2021 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Interest rate percentage | 2.90% | 2.90% | ||||||||||||||||||||||||
Repayments of debt | $ 2,850,000,000 | |||||||||||||||||||||||||
Loss on extinguishment of debt | $ 63,000,000 | |||||||||||||||||||||||||
Long Term debt and Interest Rate swap redemption | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Loss on extinguishment of debt | $ (153,000,000) | |||||||||||||||||||||||||
Abbott Ireland Financing DAC | Long-term Debt | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Debt issued - principal amount | € | € 1,180 | € 3,420 | ||||||||||||||||||||||||
Proceeds from issuance of long-term debt | $ 1,300,000,000 | $ 4,000,000,000 | ||||||||||||||||||||||||
Abbott Ireland Financing DAC | Non-interest bearing Senior Notes due 2020 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Debt issued - principal amount | € | € 1,140 | |||||||||||||||||||||||||
Debt issuance price (as a percent) | 99.727 | |||||||||||||||||||||||||
Abbott Ireland Financing DAC | Non-interest bearing Senior Notes due 2024 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Debt issued - principal amount | € | € 590 | |||||||||||||||||||||||||
Debt issuance price (as a percent) | 0.10 | |||||||||||||||||||||||||
Abbott Ireland Financing DAC | Non-interest bearing Senior Notes due 2027 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Debt issued - principal amount | € | € 590 | |||||||||||||||||||||||||
Debt issuance price (as a percent) | 0.375 | |||||||||||||||||||||||||
Abbott Ireland Financing DAC | 0.875% Senior Notes due 2023 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Debt issued - principal amount | € | € 1,140 | |||||||||||||||||||||||||
Interest rate percentage | 0.875% | |||||||||||||||||||||||||
Debt issuance price (as a percent) | 99.912 | |||||||||||||||||||||||||
Abbott Ireland Financing DAC | 1.50% Senior Notes due 2026 | ||||||||||||||||||||||||||
Debt and Lines of Credit | ||||||||||||||||||||||||||
Debt issued - principal amount | € | € 1,140 | |||||||||||||||||||||||||
Interest rate percentage | 1.50% | |||||||||||||||||||||||||
Debt issuance price (as a percent) | 99.723 |
Debt and Lines of Credit - Prin
Debt and Lines of Credit - Principal Payments (Details) $ in Billions | Dec. 31, 2020USD ($) |
Principal payments of long-term debt | |
Principal payments required in 2021 | $ 7 |
Principal payments required in 2022 | 753 |
Principal payments required in 2023 | 2.4 |
Principal payments required in 2024 | 1.3 |
Principal payments required in 2025 | 1.5 |
Principal payments required in 2026 and thereafter | $ 12.5 |
Debt and Lines of Credit - Weig
Debt and Lines of Credit - Weighted-average interest rate (Details) | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Debt and Lines of Credit | |||
Weighted-average interest rate on short-term borrowings | 0.40% | 0.40% | 0.40% |
Leases - Operating Leases as Le
Leases - Operating Leases as Lessee (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Lessee, Lease, Description | ||
Options to extend the lease term | true | |
Options to terminate the lease early | true | |
Lease, Cost | ||
Operating lease cost | $ 329 | $ 314 |
Cash paid for amounts included in the measurement of operating lease liabilities | 264 | 253 |
ROU assets arising from entering into new operating lease obligations | $ 396 | $ 310 |
Weighted average remaining lease term at December 31 (in years) | 8 years | 8 years |
Weighted average discount rate at December 31 | 3.20% | 3.90% |
Minimum | ||
Lessee, Lease, Description | ||
Operating lease contract term | 1 year | |
Maximum | ||
Lessee, Lease, Description | ||
Operating lease contract term | 10 years | |
Operating lease renewal term | 10 years |
Leases - Future Minimum Lease P
Leases - Future Minimum Lease Payments (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Operating Lease Liabilities, Payments Due | ||
2021 | $ 272 | |
2022 | 228 | |
2023 | 177 | |
2024 | 131 | |
2025 | 100 | |
Thereafter | 407 | |
Total future minimum lease payments - undiscounted | 1,315 | |
Less: imputed interest | (172) | |
Present value of lease liabilities | $ 1,143 | $ 960 |
Leases - Amounts and Location o
Leases - Amounts and Location of Operating Lease ROU Assets And Lease Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Assets and Liabilities, Lessee | ||
Operating Lease - ROU Asset | $ 1,101 | $ 934 |
Operating Lease, Assets (Balance Sheet Location) | abt:DeferredIncomeTaxesandOtherAssets | abt:DeferredIncomeTaxesandOtherAssets |
Operating Lease Liability - Current | $ 241 | $ 205 |
Operating Lease, Current Liabilities (Balance Sheet Location) | us-gaap:OtherAccruedLiabilitiesCurrent | us-gaap:OtherAccruedLiabilitiesCurrent |
Operating Lease Liability - Non-Current | $ 902 | $ 755 |
Operating Lease, Non-current Liabilities (Balance Sheet Location) | abt:Post-EmploymentObligationsOtherLong-TermLiabilities | abt:Post-EmploymentObligationsOtherLong-TermLiabilities |
Present value of lease liabilities | $ 1,143 | $ 960 |
Lease - Lessor Lease Descriptio
Lease - Lessor Lease Description (Details) - USD ($) $ in Billions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Leases where Abbott is the Lessor | ||
Operating Lease Asset, Original Cost | $ 3.3 | $ 2.8 |
Operating Lease Asset, Net Book Value | $ 1.4 | $ 1.2 |
Maximum | ||
Leases where Abbott is the Lessor | ||
Percentage of operating lease revenue to net sales | 3.00% | 3.00% |
Financial Instruments, Deriva_3
Financial Instruments, Derivatives and Fair Value Measures - Contracts (Details) $ in Millions, ¥ in Billions | Nov. 21, 2019USD ($) | Nov. 21, 2019JPY (¥) | Nov. 30, 2019USD ($) | Nov. 30, 2019JPY (¥) | Oct. 31, 2018USD ($) | Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Oct. 28, 2018 |
Derivative instruments, notional amount and fair value | |||||||||
Fair Value - Liabilities | $ 1,075 | $ 635 | |||||||
Proceeds from issuance of long-term debt | $ 1,281 | $ 1,842 | $ 4,009 | ||||||
Yen-denominated long-term debt | |||||||||
Derivative instruments, notional amount and fair value | |||||||||
Term of long term loan designated as hedge of the net investment in certain foreign subsidiaries | 5 years | 5 years | |||||||
Proceeds from issuance of long-term debt | $ 550 | ¥ 59.8 | $ 550 | ¥ 59.8 | |||||
3.40% Notes, due 2023 | |||||||||
Derivative instruments, notional amount and fair value | |||||||||
Interest rate percentage | 3.40% | 3.40% | 3.40% | 3.40% | |||||
3.75% Notes, due 2026 | |||||||||
Derivative instruments, notional amount and fair value | |||||||||
Interest rate percentage | 3.75% | 3.75% | 3.75% | 3.75% | |||||
Interest rate swap to 3.40% and 3.75% notes | |||||||||
Derivative instruments, notional amount and fair value | |||||||||
Unwound interest rate swaps | $ 1,100 | ||||||||
Payments to unwinding of derivative instruments | $ 90 | ||||||||
Designated as hedging instrument | Foreign currency forward exchange contracts | Cash flow hedges | |||||||||
Derivative instruments, notional amount and fair value | |||||||||
Gross notional amount | $ 8,100 | $ 6,800 | |||||||
Minimum length of time over which accumulated gains and losses will be recognized in Cost of products sold | 12 months | ||||||||
Maximum length of time over which accumulated gains and losses will be recognized in Cost of products sold | 18 months | ||||||||
Designated as hedging instrument | Interest rate swaps | Fair value hedges | |||||||||
Derivative instruments, notional amount and fair value | |||||||||
Gross notional amount | $ 2,900 | 2,900 | |||||||
Designated as hedging instrument | Debt | Net investment hedges | |||||||||
Derivative instruments, notional amount and fair value | |||||||||
Gain (loss) Recognized in Other Comprehensive Income (loss) | (31) | 4 | |||||||
Designated as hedging instrument | Debt | Long-term Debt | Net investment hedges | |||||||||
Derivative instruments, notional amount and fair value | |||||||||
Fair Value - Liabilities | 577 | 546 | |||||||
Not designated as hedging instrument | Foreign currency forward exchange contracts | |||||||||
Derivative instruments, notional amount and fair value | |||||||||
Gross notional amount | $ 11,000 | $ 9,100 |
Financial Instruments, Deriva_4
Financial Instruments, Derivatives and Fair Value Measures - Location of Derivative Instruments (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Derivative instruments, notional amount and fair value | ||
Fair Value - Assets | $ 300 | $ 196 |
Fair Value - Liabilities | 1,075 | 635 |
Designated as hedging instrument | Interest rate swaps | Deferred income taxes and other assets | Fair value hedges | ||
Derivative instruments, notional amount and fair value | ||
Fair Value - Assets | 210 | 48 |
Designated as hedging instrument | Foreign currency forward exchange contracts | Other prepaid expenses and receivables | ||
Derivative instruments, notional amount and fair value | ||
Fair Value - Assets | 30 | 110 |
Designated as hedging instrument | Foreign currency forward exchange contracts | Other accrued liabilities | ||
Derivative instruments, notional amount and fair value | ||
Fair Value - Liabilities | 433 | 56 |
Designated as hedging instrument | Debt | Long-term Debt | Net investment hedges | ||
Derivative instruments, notional amount and fair value | ||
Fair Value - Liabilities | 577 | 546 |
Not designated as hedging instrument | Foreign currency forward exchange contracts | Other prepaid expenses and receivables | ||
Derivative instruments, notional amount and fair value | ||
Fair Value - Assets | 60 | 38 |
Not designated as hedging instrument | Foreign currency forward exchange contracts | Other accrued liabilities | ||
Derivative instruments, notional amount and fair value | ||
Fair Value - Liabilities | $ 65 | $ 33 |
Financial Instruments, Deriva_5
Financial Instruments, Derivatives and Fair Value Measures - Gain or Loss (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Foreign currency forward exchange contracts | Not designated as hedging instrument | Net foreign exchange loss (gain) | |||
Gain (loss) on derivatives | |||
Income (expense) and Gains (loss) Reclassified into Income | $ (171) | $ 75 | $ (100) |
Foreign currency forward exchange contracts | Cash flow hedges | Designated as hedging instrument | Cost of products sold | |||
Gain (loss) on derivatives | |||
Gain (loss) Recognized in Other Comprehensive Income (loss) | (207) | 9 | 73 |
Income (expense) and Gains (loss) Reclassified into Income | 102 | 79 | (114) |
Debt | Net investment hedges | Designated as hedging instrument | |||
Gain (loss) on derivatives | |||
Gain (loss) Recognized in Other Comprehensive Income (loss) | (31) | 4 | |
Interest rate swaps | Fair value hedges | Designated as hedging instrument | Interest expense | |||
Gain (loss) on derivatives | |||
Income (expense) and Gains (loss) Reclassified into Income | $ 162 | $ 148 | $ (97) |
Financial Instruments, Deriva_6
Financial Instruments, Derivatives and Fair Value Measures - Bases of Measurement (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Maximum | ||
Fair value, asset and liability measures | ||
Contingent consideration related to business combinations | $ 200 | |
Quoted Prices in Active Markets | ||
Fair value, asset and liability measures | ||
Equity securities | 386 | $ 357 |
Total Assets | 386 | 357 |
Significant Other Observable Inputs | ||
Fair value, asset and liability measures | ||
Interest rate swap derivative financial instruments, assets | 210 | 48 |
Foreign currency forward exchange contracts | 90 | 148 |
Total Assets | 300 | 196 |
Fair value of hedged long-term debt | 3,049 | 2,890 |
Foreign currency forward exchange contracts | 498 | 89 |
Total Liabilities | 3,547 | 2,979 |
Significant Unobservable Inputs | ||
Fair value, asset and liability measures | ||
Contingent consideration related to business combinations | 68 | 68 |
Total Liabilities | 68 | 68 |
Recurring | ||
Fair value, asset and liability measures | ||
Equity securities | 386 | 357 |
Interest rate swap derivative financial instruments, assets | 210 | 48 |
Foreign currency forward exchange contracts | 90 | 148 |
Total Assets | 686 | 553 |
Fair value of hedged long-term debt | 3,049 | 2,890 |
Foreign currency forward exchange contracts | 498 | 89 |
Contingent consideration related to business combinations | 68 | 68 |
Total Liabilities | $ 3,615 | $ 3,047 |
Financial Instruments, Deriva_7
Financial Instruments, Derivatives and Fair Value Measures - Carrying Value and Fair Value (Details)K - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Fair value, asset and liability measures | ||
Long-term Investments | $ 821 | $ 883 |
Foreign currency forward exchange contracts, receivable position | 300 | 196 |
Foreign currency forward exchange contracts, (payable) position | (1,075) | (635) |
Equity securities | ||
Fair value, asset and liability measures | ||
Long-term Investments | 776 | 836 |
Carrying Value | ||
Fair value, asset and liability measures | ||
Total Long-Term debt | (18,534) | (17,938) |
Foreign currency forward exchange contracts, receivable position | 90 | 148 |
Foreign currency forward exchange contracts, (payable) position | (498) | (89) |
Interest rate hedge contracts, receivable position | 210 | 48 |
Carrying Value | Equity securities | ||
Fair value, asset and liability measures | ||
Long-term Investments | 776 | 836 |
Carrying Value | Other | ||
Fair value, asset and liability measures | ||
Long-term Investments | 45 | 47 |
Fair Value | ||
Fair value, asset and liability measures | ||
Total Long-Term debt | (22,809) | (20,772) |
Foreign currency forward exchange contracts, receivable position | 90 | 148 |
Foreign currency forward exchange contracts, (payable) position | (498) | (89) |
Interest rate hedge contracts, receivable position | 210 | 48 |
Fair Value | Equity securities | ||
Fair value, asset and liability measures | ||
Long-term Investments | 776 | 836 |
Fair Value | Other | ||
Fair value, asset and liability measures | ||
Long-term Investments | $ 45 | $ 47 |
Litigation and Environmental _2
Litigation and Environmental Matters (Details) $ in Millions | Dec. 31, 2020USD ($) |
Loss Contingencies | |
Maximum expected cleanup exposure for individual site | $ 4 |
Maximum expected cleanup exposure in aggregate | 10 |
Legal proceedings and environmental exposures | |
Loss Contingencies | |
Recorded accrual balance for legal proceedings and exposures | 105 |
Legal proceedings and environmental exposures | Minimum | |
Loss Contingencies | |
Estimation of possible loss | 90 |
Legal proceedings and environmental exposures | Maximum | |
Loss Contingencies | |
Estimation of possible loss | $ 120 |
Post-Employment Benefits - Bene
Post-Employment Benefits - Benefit Obligation (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Plan assets at fair value: | |||
Plan assets at fair value, balance at the beginning of the year | $ 10,637 | ||
Plan assets at fair value, balance at the end of the year | 12,371 | $ 10,637 | |
Projected benefit obligations greater than plan assets | |||
Projected benefit obligations greater than plan assets, December 31 | (2,773) | (2,266) | |
Long-term liabilities | (3,119) | (2,817) | |
Benefit obligations | |||
Accumulated benefit obligations | 11,900 | 10,200 | |
Accumulated benefit obligations, the projected benefit obligations and the aggregate plan assets | |||
Projected benefit obligation | 8,946 | 7,585 | |
Fair value of plan assets | 7,010 | 5,936 | |
Accumulated benefit obligation | 2,459 | 1,985 | |
Projected benefit obligation | 2,773 | 2,266 | |
Fair value of plan assets | 965 | 821 | |
Defined Benefit Plans | |||
Projected benefit obligations: | |||
Projected benefit obligations, balance at the beginning of the year | 11,238 | 9,093 | |
Service cost - benefits earned during the year | 336 | 250 | $ 293 |
Interest cost on projected benefit obligations | 300 | 337 | 308 |
(Gains) losses, primarily changes in discount rates, plan design changes, law changes and differences between actual and estimated health care costs | 1,305 | 1,856 | |
Benefits paid | (327) | (302) | |
Other, including foreign currency translation | 277 | 4 | |
Projected benefit obligations, balance at the end of the year | 13,129 | 11,238 | 9,093 |
Plan assets at fair value: | |||
Plan assets at fair value, balance at the beginning of the year | 10,277 | 8,553 | |
Actual return (loss) on plan assets | 1,463 | 1,622 | |
Company contributions | 400 | 382 | |
Benefits paid | (327) | (302) | |
Other, including foreign currency translation | 205 | 22 | |
Plan assets at fair value, balance at the end of the year | 12,018 | 10,277 | 8,553 |
Projected benefit obligations greater than plan assets | |||
Projected benefit obligations greater than plan assets, December 31 | (1,111) | (961) | |
Long-term assets | 824 | 687 | |
Short-term liabilities | (29) | (26) | |
Long-term liabilities | (1,906) | (1,622) | |
Defined Benefit Plan, Amounts Recognized in Balance Sheet | (1,111) | (961) | |
Amounts Recognized in Accumulated Other Comprehensive Income (loss): | |||
Actuarial losses, net | 4,559 | 4,131 | |
Prior service cost (credits) | (5) | (2) | |
Total | 4,554 | 4,129 | |
Accumulated benefit obligations, the projected benefit obligations and the aggregate plan assets | |||
Projected benefit obligation | 1,111 | 961 | |
Defined Benefit Plans | Non-US | |||
Benefit obligations | |||
Projected benefit obligations | 4,100 | 3,300 | |
Medical and Dental Plans | |||
Projected benefit obligations: | |||
Projected benefit obligations, balance at the beginning of the year | 1,556 | 1,292 | |
Service cost - benefits earned during the year | 46 | 23 | 26 |
Interest cost on projected benefit obligations | 42 | 52 | 48 |
(Gains) losses, primarily changes in discount rates, plan design changes, law changes and differences between actual and estimated health care costs | (5) | 228 | |
Benefits paid | (73) | (76) | |
Other, including foreign currency translation | 1 | 37 | |
Projected benefit obligations, balance at the end of the year | 1,567 | 1,556 | 1,292 |
Plan assets at fair value: | |||
Plan assets at fair value, balance at the beginning of the year | 360 | 351 | |
Actual return (loss) on plan assets | 46 | 65 | |
Company contributions | 12 | 12 | |
Benefits paid | (65) | (68) | |
Plan assets at fair value, balance at the end of the year | 353 | 360 | $ 351 |
Projected benefit obligations greater than plan assets | |||
Projected benefit obligations greater than plan assets, December 31 | (1,214) | (1,196) | |
Short-term liabilities | (1) | (1) | |
Long-term liabilities | (1,213) | (1,195) | |
Defined Benefit Plan, Amounts Recognized in Balance Sheet | (1,214) | (1,196) | |
Amounts Recognized in Accumulated Other Comprehensive Income (loss): | |||
Actuarial losses, net | 486 | 529 | |
Prior service cost (credits) | (67) | (95) | |
Total | 419 | 434 | |
Accumulated benefit obligations, the projected benefit obligations and the aggregate plan assets | |||
Projected benefit obligation | $ 1,214 | $ 1,196 |
Post-Employment Benefits - Expe
Post-Employment Benefits - Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Defined Benefit Plans | |||
Defined benefit plan net periodic benefit cost | |||
Service cost - benefits earned during the year | $ 336 | $ 250 | $ 293 |
Interest cost on projected benefit obligations | 300 | 337 | 308 |
Expected return on plans assets | (770) | (710) | (680) |
Amortization of actuarial losses | 255 | 132 | 205 |
Amortization of prior service cost (credits) | 1 | 1 | 1 |
Total net cost | 122 | 10 | 127 |
Net actuarial losses (gains), net of any prior service credits | 611 | 944 | 86 |
Medical and Dental Plans | |||
Defined benefit plan net periodic benefit cost | |||
Service cost - benefits earned during the year | 46 | 23 | 26 |
Interest cost on projected benefit obligations | 42 | 52 | 48 |
Expected return on plans assets | (28) | (27) | (33) |
Amortization of actuarial losses | 21 | 22 | 33 |
Amortization of prior service cost (credits) | (28) | (32) | (45) |
Total net cost | 53 | 38 | 29 |
Net actuarial losses (gains), net of any prior service credits | $ (23) | $ 190 | $ (53) |
Post-Employment Benefits - Assu
Post-Employment Benefits - Assumptions (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Defined benefit plans and medical and dental plans | |||
Weighted average assumptions used to determine benefit obligations | |||
Discount rate (as a percent) | 2.30% | 3.00% | 4.00% |
Expected aggregate average long-term change in compensation (as a percent) | 4.30% | 4.30% | 4.30% |
Weighted average assumptions used to determine the net cost | |||
Discount rate (as a percent) | 3.00% | 4.00% | 3.40% |
Expected return on plan assets (as a percent) | 7.50% | 7.50% | 7.70% |
Expected aggregate average long-term change in compensation (as a percent) | 4.30% | 4.30% | 4.40% |
Medical and Dental Plans | |||
Assumed health care cost trend rates | |||
Health care cost trend rate assumed for the next year (as a percent) | 8.00% | 9.00% | 9.00% |
Rate that the cost trend rate gradually declines to (as a percent) | 5.00% | 5.00% | 5.00% |
Year that rate reaches the assumed ultimate rate | 2025 | 2025 | 2025 |
Post-Employment Benefits - Asse
Post-Employment Benefits - Assets (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | $ 12,371 | $ 10,637 |
Unfunded commitments to investments in the private funds | 523 | 579 |
U.S. large cap | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 3,410 | 2,873 |
U.S. mid and small cap | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 775 | 648 |
International | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 2,654 | 2,202 |
U.S. government securities | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 475 | 562 |
Corporate debt instruments | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 1,408 | 1,266 |
Non U.S. government securities | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 523 | 445 |
Other | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 503 | 320 |
Absolute return funds | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 1,618 | 1,557 |
Cash and Cash Equivalents | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 281 | 182 |
Other | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 724 | 582 |
Quoted Prices in Active Markets | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 4,636 | 3,661 |
Quoted Prices in Active Markets | U.S. large cap | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 2,202 | 1,647 |
Quoted Prices in Active Markets | U.S. mid and small cap | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 721 | 548 |
Quoted Prices in Active Markets | International | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 542 | 464 |
Quoted Prices in Active Markets | U.S. government securities | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 23 | 52 |
Quoted Prices in Active Markets | Corporate debt instruments | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 425 | 362 |
Quoted Prices in Active Markets | Non U.S. government securities | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 16 | 3 |
Quoted Prices in Active Markets | Other | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 159 | 69 |
Quoted Prices in Active Markets | Absolute return funds | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 462 | 424 |
Quoted Prices in Active Markets | Cash and Cash Equivalents | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 77 | 84 |
Quoted Prices in Active Markets | Other | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 9 | 8 |
Significant Other Observable Inputs | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 1,269 | 1,114 |
Significant Other Observable Inputs | U.S. mid and small cap | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 4 | |
Significant Other Observable Inputs | U.S. government securities | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 289 | 357 |
Significant Other Observable Inputs | Corporate debt instruments | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 908 | 724 |
Significant Other Observable Inputs | Non U.S. government securities | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 2 | |
Significant Other Observable Inputs | Other | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 72 | 27 |
Significant Unobservable Inputs | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 3 | 3 |
Significant Unobservable Inputs | U.S. mid and small cap | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 3 | 2 |
Significant Unobservable Inputs | Other | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 1 | |
Measured at NAV | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 6,463 | 5,859 |
Measured at NAV | U.S. large cap | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 1,208 | 1,226 |
Measured at NAV | U.S. mid and small cap | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 51 | 94 |
Measured at NAV | International | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 2,112 | 1,738 |
Measured at NAV | U.S. government securities | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 163 | 153 |
Measured at NAV | Corporate debt instruments | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 75 | 180 |
Measured at NAV | Non U.S. government securities | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 507 | 440 |
Measured at NAV | Other | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 272 | 224 |
Measured at NAV | Absolute return funds | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 1,156 | 1,133 |
Measured at NAV | Cash and Cash Equivalents | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | 204 | 98 |
Measured at NAV | Other | ||
Defined benefit plans disclosures | ||
Defined benefit plans' assets at fair value | $ 715 | $ 573 |
Equities | Minimum | ||
Defined benefit plans disclosures | ||
Redemption notice period | 7 days | |
Equities | Maximum | ||
Defined benefit plans disclosures | ||
Redemption notice period | 30 days | |
Fixed Income Securities | ||
Defined benefit plans disclosures | ||
Maximum amount of fund with redemption limit to 33% | $ 245 | |
Maximum amount of fund with redemption limit to 25% | $ 110 | |
Maximum redemption fund percentage - 33% | 33.00% | |
Maximum redemption fund percentage - 25% | 25.00% | |
Investments that are subject to lock until 2022 | $ 60 | |
Fixed Income Securities | Minimum | ||
Defined benefit plans disclosures | ||
Redemption notice period | 2 days | |
Fixed Income Securities | Maximum | ||
Defined benefit plans disclosures | ||
Redemption notice period | 14 days | |
Absolute return funds | Minimum | ||
Defined benefit plans disclosures | ||
Redemption notice period | 5 days | |
Absolute return funds | Maximum | ||
Defined benefit plans disclosures | ||
Redemption notice period | 90 days |
Post-Employment Benefits - Fund
Post-Employment Benefits - Funding and Payments (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Defined Benefit Plans | ||
Defined benefit plans disclosures | ||
Company contributions | $ 400 | $ 382 |
Defined benefit plan, expected contributions in 2021 | 410 | |
Total benefit payments expected to be paid to participants | ||
2021 | 340 | |
2022 | 355 | |
2023 | 373 | |
2024 | 395 | |
2025 | 415 | |
2026 to 2030 | 2,410 | |
Medical and Dental Plans | ||
Defined benefit plans disclosures | ||
Company contributions | 12 | $ 12 |
Total benefit payments expected to be paid to participants | ||
2021 | 72 | |
2022 | 73 | |
2023 | 74 | |
2024 | 75 | |
2025 | 76 | |
2026 to 2030 | $ 394 |
Post-Employment Benefits - Stoc
Post-Employment Benefits - Stock Retirement Plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Abbott Stock Retirement Plan | |||
Defined contribution plan | |||
Contribution to Abbott Stock Retirement Plan, defined contribution plan | $ 164 | $ 158 | $ 146 |
Taxes on Earnings from Contin_3
Taxes on Earnings from Continuing Operations (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | 15 Months Ended | ||
Dec. 31, 2017 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2018 | |
Taxes on Earnings from Continuing Operations | |||||
Tax benefits associated with impairment of certain assets | $ (170) | ||||
Net tax (benefits) expense primarily as a result of the resolution of various tax positions related to prior years | (140) | $ 68 | $ 98 | ||
Excess tax benefits associated with share-based compensation | (100) | ||||
Increase (reduction) of provisional transition tax | $ 2,890 | 26 | (86) | 120 | $ 3,010 |
Net tax expense for the impact of Tax cuts and jobs act | 26 | 130 | |||
Cumulative net tax expense for the impact of Tax cuts and jobs act | 1,530 | ||||
Transition tax obligation | $ 805 | ||||
Transition tax obligation payment period | 6 years | ||||
Net benefit on remeasurement of deferred tax assets and liabilities | $ 86 | ||||
Net expense (benefit) on remeasurement of deferred tax assets and liabilities | $ 10 |
Taxes on Earnings from Contin_4
Taxes on Earnings from Continuing Operations - Earnings and Taxes (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Earnings From Continuing Operations Before Taxes: | |||
Domestic | $ 1,588 | $ 889 | $ (430) |
Foreign | 3,380 | 3,188 | 3,303 |
Earnings from Continuing Operations Before Taxes | 4,968 | 4,077 | 2,873 |
Current: | |||
Domestic, current tax | 39 | 291 | (812) |
Foreign, current tax | 566 | 590 | 606 |
Total current taxes | 605 | 881 | (206) |
Deferred: | |||
Domestic, deferred tax | (18) | (305) | 832 |
Foreign, deferred tax | (90) | (186) | (87) |
Total deferred taxes | (108) | (491) | 745 |
Total | $ 497 | $ 390 | $ 539 |
Taxes on Earnings from Contin_5
Taxes on Earnings from Continuing Operations - Tax Rate Reconciliation (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Differences between the effective income tax rate and the U.S. statutory tax rate: | |||
Statutory tax rate on earnings from continuing operations (as a percent) | 21.00% | 21.00% | 21.00% |
Impact of foreign operations (as a percent) | (3.30%) | (5.00%) | (5.40%) |
Impact of TCJA and other related items (as a percent) | 0.50% | (2.10%) | 6.30% |
Foreign-derived intangible income benefit (as a percent) | (1.00%) | (2.00%) | (1.90%) |
Domestic impairment loss (as a percent) | (2.70%) | (2.10%) | |
Excess tax benefits related to stock compensation (as a percent) | (1.90%) | (2.50%) | (3.10%) |
Research tax credit (as a percent) | (1.00%) | (1.20%) | (1.80%) |
Resolution of certain tax positions pertaining to prior years (as a percent) | (2.80%) | 3.40% | |
Intercompany restructurings and integration | 0.50% | ||
State taxes, net of federal benefit (as a percent) | 0.50% | 0.80% | 0.40% |
All other, net (as a percent) | 0.20% | 0.60% | 2.00% |
Effective tax rate on earnings from continuing operations (as a percent) | 10.00% | 9.60% | 18.80% |
Taxes on Earnings from Contin_6
Taxes on Earnings from Continuing Operations - Deferred Tax Assets and Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||
Compensation and employee benefits | $ 1,003 | $ 982 |
Other, primarily reserves not currently deductible, and NOL's and credit carryforwards | 2,383 | 2,378 |
Trade receivable reserves | 196 | 190 |
Inventory reserves | 146 | 110 |
Lease liabilities | 259 | 209 |
Deferred intercompany profit | 254 | 259 |
Total deferred tax assets before valuation allowance | 4,241 | 4,128 |
Valuation allowance | (1,060) | (978) |
Total deferred tax assets | 3,181 | 3,150 |
Deferred tax liabilities: | ||
Depreciation | (297) | (219) |
Right of Use lease assets | (251) | (209) |
Other, primarily the excess of book basis over tax basis of intangible assets | (2,876) | (3,258) |
Total deferred tax liabilities | 3,424 | 3,686 |
Total net deferred tax assets (liabilities) | $ (243) | $ (536) |
Taxes on Earnings from Contin_7
Taxes on Earnings from Continuing Operations - Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Reconciliation of Unrecognized Tax Benefits | ||
Balance at the beginning of the period | $ 1,175 | $ 1,120 |
Increase due to current year tax positions | 190 | 137 |
Increase due to prior year tax positions | 97 | 75 |
Decrease due to prior year tax positions | (144) | (117) |
Settlements | (27) | (32) |
Lapse of statute | (81) | (8) |
Balance at the end of the period | 1,210 | $ 1,175 |
Unrecognized tax benefits that would impact effective tax rate | 1,080 | |
Minimum | ||
Reconciliation of Unrecognized Tax Benefits | ||
Decrease reasonably possible in gross unrecognized tax benefits | 70 | |
Maximum | ||
Reconciliation of Unrecognized Tax Benefits | ||
Decrease reasonably possible in gross unrecognized tax benefits | $ 430 |
Segment and Geographic Area I_3
Segment and Geographic Area Information - Sales and Earnings (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Information | |||
Net Sales to External Customers | $ 34,608 | $ 31,904 | $ 30,578 |
Operating Earnings | 5,357 | 4,532 | 3,650 |
Established Pharmaceutical Products | |||
Segment Information | |||
Net Sales to External Customers | 4,303 | 4,486 | 4,422 |
Nutritional Products | |||
Segment Information | |||
Net Sales to External Customers | 7,647 | 7,409 | 7,229 |
Diagnostic Products | |||
Segment Information | |||
Net Sales to External Customers | 10,805 | 7,713 | 7,495 |
Medical Devices | |||
Segment Information | |||
Net Sales to External Customers | 11,787 | 12,239 | 11,370 |
Other | |||
Segment Information | |||
Net Sales to External Customers | 66 | 57 | 62 |
Total Reportable Segment Operating Earnings | |||
Segment Information | |||
Net Sales to External Customers | 34,542 | 31,847 | 30,516 |
Operating Earnings | 9,308 | 8,290 | 7,914 |
Total Reportable Segment Operating Earnings | Established Pharmaceutical Products | |||
Segment Information | |||
Net Sales to External Customers | 4,303 | 4,486 | 4,422 |
Operating Earnings | 794 | 904 | 894 |
Total Reportable Segment Operating Earnings | Nutritional Products | |||
Segment Information | |||
Net Sales to External Customers | 7,647 | 7,409 | 7,229 |
Operating Earnings | 1,751 | 1,705 | 1,652 |
Total Reportable Segment Operating Earnings | Diagnostic Products | |||
Segment Information | |||
Net Sales to External Customers | 10,805 | 7,713 | 7,495 |
Operating Earnings | 3,725 | 1,912 | 1,868 |
Total Reportable Segment Operating Earnings | Medical Devices | |||
Segment Information | |||
Net Sales to External Customers | 11,787 | 12,239 | 11,370 |
Operating Earnings | $ 3,038 | $ 3,769 | $ 3,500 |
Segment and Geographic Area I_4
Segment and Geographic Area Information - Reconciliation (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Information | |||
Operating Earnings | $ 5,357 | $ 4,532 | $ 3,650 |
Loss on extinguishment of debt | (63) | (167) | |
Share-based compensation | (546) | (519) | (477) |
Amortization of intangible assets | (2,132) | (1,936) | (2,178) |
Earnings from Continuing Operations Before Taxes | 4,968 | 4,077 | 2,873 |
Total Reportable Segment Operating Earnings | |||
Segment Information | |||
Operating Earnings | 9,308 | 8,290 | 7,914 |
Corporate functions and benefit plan costs | |||
Segment Information | |||
Corporate functions and benefit plan costs | (518) | (468) | (618) |
Reconciling items | |||
Segment Information | |||
Net interest expense | (500) | (576) | (721) |
Share-based compensation | (546) | (519) | (477) |
Amortization of intangible assets | (2,132) | (1,936) | (2,178) |
Other, net | (644) | (651) | (880) |
Charges for restructuring actions and other cost reduction initiatives | $ 125 | $ 215 | $ 153 |
Segment and Geographic Area I_5
Segment and Geographic Area Information - Depreciation and Assets (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Information | |||
Depreciation | $ 1,195 | $ 1,078 | $ 1,100 |
Additions to Property and Equipment | 2,193 | 1,668 | 1,394 |
Total Assets | 72,548 | 67,887 | 67,173 |
Segment assets: | |||
Total Assets | 72,548 | 67,887 | 67,173 |
Other | |||
Segment Information | |||
Depreciation | 195 | 172 | 167 |
Additions to Property and Equipment | 218 | 160 | 160 |
Total Reportable Segment Operating Earnings | |||
Segment Information | |||
Depreciation | 1,000 | 906 | 933 |
Additions to Property and Equipment | 1,975 | 1,508 | 1,234 |
Total Assets | 20,955 | 18,007 | 16,085 |
Segment assets: | |||
Total Assets | 20,955 | 18,007 | 16,085 |
Total Reportable Segment Operating Earnings | Established Pharmaceutical Products | |||
Segment Information | |||
Depreciation | 88 | 98 | 92 |
Additions to Property and Equipment | 109 | 109 | 131 |
Total Assets | 2,888 | 2,858 | 2,664 |
Segment assets: | |||
Total Assets | 2,888 | 2,858 | 2,664 |
Total Reportable Segment Operating Earnings | Nutritional Products | |||
Segment Information | |||
Depreciation | 143 | 139 | 150 |
Additions to Property and Equipment | 201 | 141 | 86 |
Total Assets | 3,478 | 3,274 | 3,071 |
Segment assets: | |||
Total Assets | 3,478 | 3,274 | 3,071 |
Total Reportable Segment Operating Earnings | Diagnostic Products | |||
Segment Information | |||
Depreciation | 488 | 403 | 397 |
Additions to Property and Equipment | 1,263 | 726 | 609 |
Total Assets | 7,696 | 5,235 | 4,464 |
Segment assets: | |||
Total Assets | 7,696 | 5,235 | 4,464 |
Total Reportable Segment Operating Earnings | Medical Devices | |||
Segment Information | |||
Depreciation | 281 | 266 | 294 |
Additions to Property and Equipment | 402 | 532 | 408 |
Total Assets | 6,893 | 6,640 | 5,886 |
Segment assets: | |||
Total Assets | 6,893 | 6,640 | 5,886 |
Reconciling items | |||
Segment assets: | |||
Cash and investments | 7,969 | 5,023 | 4,983 |
Goodwill and intangible assets | 38,528 | 40,220 | 42,196 |
All other | $ 5,096 | $ 4,637 | $ 3,909 |
Segment and Geographic Area I_6
Segment and Geographic Area Information - Geographic Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Segment Information | |||
Net Sales to External Customers | $ 34,608 | $ 31,904 | $ 30,578 |
Long-lived assets | 11,700 | 10,200 | |
U.S. | |||
Segment Information | |||
Net Sales to External Customers | 13,022 | 11,398 | 10,839 |
Long-lived assets | 6,100 | 5,100 | |
Germany | |||
Segment Information | |||
Net Sales to External Customers | 2,108 | 1,751 | 1,619 |
China | |||
Segment Information | |||
Net Sales to External Customers | 1,965 | 2,346 | 2,311 |
Japan | |||
Segment Information | |||
Net Sales to External Customers | 1,386 | 1,435 | 1,326 |
India | |||
Segment Information | |||
Net Sales to External Customers | 1,323 | 1,397 | 1,333 |
Switzerland | |||
Segment Information | |||
Net Sales to External Customers | 1,140 | 1,068 | 1,005 |
The Netherlands | |||
Segment Information | |||
Net Sales to External Customers | 1,084 | 975 | 930 |
All Other Countries | |||
Segment Information | |||
Net Sales to External Customers | $ 12,580 | $ 11,534 | $ 11,215 |
SCHEDULE II VALUATION AND QUA_2
SCHEDULE II VALUATION AND QUALIFYING ACCOUNTS (Details) - Allowances for Doubtful Accounts and Product Returns - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Allowances for Doubtful Accounts and Product Returns | |||
Balance at beginning of period | $ 384 | $ 314 | $ 294 |
Provisions/charges to income | 187 | 137 | 110 |
Amounts charged off and other deductions | (111) | (68) | (90) |
Total | $ 460 | $ 384 | $ 314 |