Cover page
Cover page - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Feb. 03, 2021 | Jun. 30, 2020 | |
Entity Information [Line Items] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2020 | ||
Document Transition Report | false | ||
Entity File Number | 001-37702 | ||
Entity Registrant Name | Amgen Inc. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 95-3540776 | ||
Entity Address, Address Line One | One Amgen Center Drive | ||
Entity Address, City or Town | Thousand Oaks | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 91320-1799 | ||
City Area Code | 805 | ||
Local Phone Number | 447-1000 | ||
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 Public Float | $ 138,056,968,288 | ||
Entity Common Stock, Shares Outstanding | 577,566,383 | ||
Documents Incorporated by Reference | DOCUMENTS INCORPORATED BY REFERENCE Specified portions of the registrant’s Proxy Statement with respect to the 2021 Annual Meeting of Stockholders to be held May 18, 2021, are incorporated by reference into Part III of this annual report. | ||
Entity Central Index Key | 0000318154 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Current Fiscal Year End Date | --12-31 | ||
Common Stock | The NASDAQ Global Select Market | |||
Entity Information [Line Items] | |||
Title of 12(b) Security | Common stock, $0.0001 par value | ||
Trading Symbol | AMGN | ||
Security Exchange Name | NASDAQ | ||
1.250% Senior Notes Due 2022 | New York Stock Exchange | |||
Entity Information [Line Items] | |||
Title of 12(b) Security | 1.250% Senior Notes Due 2022 | ||
Trading Symbol | AMGN22 | ||
Security Exchange Name | NASDAQ | ||
2.00% Senior Notes Due 2026 | New York Stock Exchange | |||
Entity Information [Line Items] | |||
Title of 12(b) Security | 2.00% Senior Notes Due 2026 | ||
Trading Symbol | AMGN26 | ||
Security Exchange Name | NASDAQ |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Revenues: | |||
Product sales | $ 25,424 | $ 23,362 | $ 23,747 |
Total revenues | 25,424 | 23,362 | 23,747 |
Operating expenses: | |||
Cost of sales | 6,159 | 4,356 | 4,101 |
Research and development | 4,207 | 4,116 | 3,737 |
Selling, general and administrative | 5,730 | 5,150 | 5,332 |
Other | 189 | 66 | 314 |
Total operating expenses | 16,285 | 13,688 | 13,484 |
Operating income | 9,139 | 9,674 | 10,263 |
Interest expense, net | 1,262 | 1,289 | 1,392 |
Interest and other income, net | 256 | 753 | 674 |
Income before income taxes | 8,133 | 9,138 | 9,545 |
Provision for income taxes | 869 | 1,296 | 1,151 |
Net income | $ 7,264 | $ 7,842 | $ 8,394 |
Earnings per share: | |||
Basic (in usd per share) | $ 12.40 | $ 12.96 | $ 12.70 |
Diluted (in usd per share) | $ 12.31 | $ 12.88 | $ 12.62 |
Shares used in the calculation of earnings per share: | |||
Basic (in shares) | 586 | 605 | 661 |
Diluted (in shares) | 590 | 609 | 665 |
Product sales [Member] | |||
Revenues: | |||
Product sales | $ 24,240 | $ 22,204 | $ 22,533 |
Other [Member] | |||
Revenues: | |||
Product sales | 1,184 | 1,158 | 1,214 |
Other revenues | $ 1,184 | $ 1,158 | $ 1,214 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 7,264 | $ 7,842 | $ 8,394 |
Other comprehensive (loss) income, net of reclassification adjustments and taxes: | |||
Gains (losses) on foreign currency translation | 9 | (48) | (141) |
(Losses) gains on cash flow hedges | (438) | (66) | 247 |
(Losses) gains on available-for-sale securities | (21) | 360 | (185) |
Other losses | (7) | (5) | (2) |
Other comprehensive (loss) income, net of taxes | (457) | 241 | (81) |
Comprehensive income | $ 6,807 | $ 8,083 | $ 8,313 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) shares in Millions, $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 6,266 | $ 6,037 |
Marketable securities | 4,381 | 2,874 |
Trade receivables, net | 4,525 | 4,057 |
Inventories | 3,893 | 3,584 |
Other current assets | 2,079 | 1,888 |
Total current assets | 21,144 | 18,440 |
Property, plant and equipment, net | 4,889 | 4,928 |
Intangible assets, net | 16,587 | 19,413 |
Goodwill | 14,689 | 14,703 |
Other assets | 5,639 | 2,223 |
Total assets | 62,948 | 59,707 |
Current liabilities: | ||
Accounts payable | 1,421 | 1,371 |
Accrued liabilities | 10,141 | 8,511 |
Current portion of long-term debt | 91 | 2,953 |
Total current liabilities | 11,653 | 12,835 |
Long-term debt | 32,895 | 26,950 |
Long-term tax liabilities | 6,968 | 8,037 |
Other noncurrent liabilities | 2,023 | 2,212 |
Contingencies and commitments | ||
Common Stock, Shares Authorized | 2,750 | 2,750 |
Common Stock, Shares, Outstanding | 578.3 | 591.4 |
Common Stock, Par or Stated Value Per Share | $ 0.0001 | $ 0.0001 |
Stockholders’ equity: | ||
Common stock and additional paid-in capital; $0.0001 par value per share; 2,750.0 shares authorized; outstanding— 578.3 shares in 2020 and 591.4 shares in 2019 | $ 31,802 | $ 31,531 |
Accumulated deficit | (21,408) | (21,330) |
Accumulated other comprehensive loss | (985) | (528) |
Total stockholders’ equity | 9,409 | 9,673 |
Total liabilities and stockholders’ equity | $ 62,948 | $ 59,707 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares shares in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Common stock and additional paid-in capital, par value (in usd per share) | $ 0.0001 | $ 0.0001 |
Common stock and additional paid-in capital, shares authorized | 2,750 | 2,750 |
Common stock and additional paid-in capital, shares outstanding | 578.3 | 591.4 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Millions, $ in Millions | Total | Cumulative Effect, Period of Adoption, Adjustment [Member] | Number of shares of common stock | Common stock and additional paid-in capital [Member] | Accumulated deficit [Member] | Accumulated deficit [Member]Cumulative Effect, Period of Adoption, Adjustment [Member] | Accumulated other comprehensive loss [Member] | Accumulated other comprehensive loss [Member]Cumulative Effect, Period of Adoption, Adjustment [Member] |
Beginning Balance, Shares at Dec. 31, 2017 | 722.2 | |||||||
Beginning Balance at Dec. 31, 2017 | $ 25,241 | $ 29 | $ 30,992 | $ (5,072) | $ 38 | $ (679) | $ (9) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 8,394 | 8,394 | ||||||
Other comprehensive income (loss), net of tax | (81) | (81) | ||||||
Dividends declared on common stock | (3,482) | (3,482) | ||||||
Issuance of common stock in connection with the Company’s equity award programs, Shares | 1.9 | |||||||
Issuance of common stock in connection with the Company’s equity award programs | 56 | 56 | ||||||
Stock-based compensation expense | 327 | 327 | ||||||
Tax impact related to employee stock-based compensation expense | (129) | (129) | ||||||
Repurchases of common stock, Shares | (94.5) | |||||||
Repurchases of common stock | (17,855) | (17,855) | ||||||
Ending Balance, Shares at Dec. 31, 2018 | 629.6 | |||||||
Ending Balance at Dec. 31, 2018 | 12,500 | 31,246 | (17,977) | (769) | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 7,842 | 7,842 | ||||||
Other comprehensive income (loss), net of tax | 241 | 241 | ||||||
Dividends declared on common stock | (3,555) | (3,555) | ||||||
Issuance of common stock in connection with the Company’s equity award programs, Shares | 2 | |||||||
Issuance of common stock in connection with the Company’s equity award programs | 97 | 97 | ||||||
Stock-based compensation expense | 323 | 323 | ||||||
Tax impact related to employee stock-based compensation expense | (135) | (135) | ||||||
Repurchases of common stock, Shares | (40.2) | |||||||
Repurchases of common stock | $ (7,640) | (7,640) | ||||||
Ending Balance, Shares at Dec. 31, 2019 | 591.4 | 591.4 | ||||||
Ending Balance at Dec. 31, 2019 | $ 9,673 | $ (2) | 31,531 | (21,330) | $ (2) | (528) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income | 7,264 | 7,264 | ||||||
Other comprehensive income (loss), net of tax | (457) | (457) | ||||||
Dividends declared on common stock | (3,843) | (3,843) | ||||||
Issuance of common stock in connection with the Company’s equity award programs, Shares | 2.1 | |||||||
Issuance of common stock in connection with the Company’s equity award programs | 91 | 91 | ||||||
Stock-based compensation expense | 349 | 349 | ||||||
Tax impact related to employee stock-based compensation expense | (169) | (169) | ||||||
Repurchases of common stock, Shares | (15.2) | |||||||
Repurchases of common stock | $ (3,497) | (3,497) | ||||||
Ending Balance, Shares at Dec. 31, 2020 | 578.3 | 578.3 | ||||||
Ending Balance at Dec. 31, 2020 | $ 9,409 | $ 31,802 | $ (21,408) | $ (985) |
Consolidated Statements of St_2
Consolidated Statements of Stockholders' Equity (Parenthetical) - $ / shares | Dec. 16, 2020 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Statement of Stockholders' Equity [Abstract] | ||||
Common stock, dividends declared per share (in usd per share) | $ 1.76 | $ 6.56 | $ 5.95 | $ 5.41 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Cash flows from operating activities: | |||
Net income | $ 7,264 | $ 7,842 | $ 8,394 |
Depreciation, amortization and other | 3,601 | 2,206 | 1,946 |
Stock-based compensation expense | 330 | 308 | 311 |
Deferred income taxes | (287) | (289) | (363) |
Other items, net | (195) | (186) | 386 |
Changes in operating assets and liabilities, net of acquisitions: | |||
Trade receivables, net | (427) | (504) | (378) |
Inventories | (215) | (66) | (3) |
Other assets | 129 | 10 | 35 |
Accounts payable | 45 | 164 | (143) |
Accrued income taxes, net | (249) | (585) | (361) |
Long-term tax liabilities | (482) | (146) | 258 |
Other liabilities | 983 | 396 | 1,214 |
Net cash provided by operating activities | 10,497 | 9,150 | 11,296 |
Cash flows from investing activities: | |||
Purchases of marketable securities | (8,477) | (9,394) | (18,741) |
Proceeds from sales of marketable securities | 2,597 | 8,842 | 28,356 |
Proceeds from maturities of marketable securities | 4,381 | 20,548 | 5,412 |
Purchases of property, plant and equipment | (608) | (618) | (738) |
Cash paid for acquisitions, net of cash acquired | 0 | (13,617) | 195 |
Payments to Acquire Equity Method Investments | (3,219) | (24) | (40) |
Other | (75) | (28) | (105) |
Net cash (used in) provided by investing activities | (5,401) | 5,709 | 14,339 |
Cash flows from financing activities: | |||
Net proceeds from issuance of debt | 8,914 | 0 | 0 |
Repayment of debt | (6,450) | (4,514) | (1,121) |
Repurchases of common stock | (3,486) | (7,702) | (17,794) |
Dividends paid | (3,755) | (3,509) | (3,507) |
Other | (90) | (42) | (68) |
Net cash used in financing activities | (4,867) | (15,767) | (22,490) |
Increase (decrease) in cash and cash equivalents | 229 | (908) | 3,145 |
Cash and cash equivalents at beginning of year | 6,037 | 6,945 | 3,800 |
Cash and cash equivalents at end of year | $ 6,266 | $ 6,037 | $ 6,945 |
Summary of significant accounti
Summary of significant accounting policies | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of significant accounting policies | Summary of significant accounting policies Business Amgen Inc. (including its subsidiaries, referred to as “Amgen,” “the Company,” “we,” “our” or “us”) is a global biotechnology pioneer that discovers, develops, manufactures and delivers innovative human therapeutics. We operate in one business segment: human therapeutics. Principles of consolidation The consolidated financial statements include the accounts of Amgen as well as its majority-owned subsidiaries. We do not have any significant interests in any variable interest entities. All material intercompany transactions and balances have been eliminated in consolidation. Use of estimates The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results may differ from those estimates. Revenues Product sales and sales deductions Revenue from product sales is recognized upon transfer of control of a product to a customer, generally upon delivery, based on an amount that reflects the consideration to which we expect to be entitled, net of accruals for estimated rebates, wholesaler chargebacks, discounts and other deductions (collectively, sales deductions) and returns established at the time of sale. We analyze the adequacy of our accruals for sales deductions quarterly. Amounts accrued for sales deductions are adjusted when trends or significant events indicate that an adjustment is appropriate. Accruals are also adjusted to reflect actual results. Accruals for sales deductions are based primarily on estimates of the amounts earned or to be claimed on the related sales. These estimates take into consideration current contractual and statutory requirements, specific known market events and trends, internal and external historical data and forecasted customer buying patterns. Sales deductions are substantially product specific and therefore, for any given period, can be affected by the mix of products sold. Included in sales deductions are immaterial net adjustments related to prior-period sales due to changes in estimates. Historically, such amounts have represented less than 1% of the aggregate sales deductions charged against product sales. Returns are estimated through comparison of historical return data to their related sales on a production lot basis. Historical rates of return are determined for each product and are adjusted for known or expected changes in the marketplace specific to each product, when appropriate. Historically, sales return provisions have amounted to less than 1% of gross product sales. Changes in estimates for prior-period sales return provisions have historically been immaterial. Our payment terms vary by types and locations of customers and the products or services offered. Payment terms differ by jurisdiction and customer, but payment is generally required in a term ranging from 30 to 120 days from date of shipment or satisfaction of the performance obligation. For certain products or services and certain customer types, we may require payment before products are delivered or services are rendered to customers. Indirect taxes collected from customers and remitted to government authorities and that are related to sales of the Company’s products, primarily in Europe, are excluded from revenues. As a practical expedient, sales commissions are expensed when incurred because the amortization period would have been one year or less. These costs are recorded in Selling, general and administrative (SG&A) expense in the Consolidated Statements of Income. Other revenues Other revenues consist primarily of royalty income and corporate partner revenues. Royalties from licensees are based on third-party sales of licensed products and are recorded when the related third-party product sale occurs. Royalty income is estimated based on historical and forecasted sales trends. Corporate partner revenues are composed mainly of license fees and milestones earned and our share of commercial profits generated from collaborations. See Arrangements with multiple-performance obligations, discussed below. Arrangements with multiple-performance obligations From time to time, we enter into arrangements for the research and development (R&D), manufacture and/or commercialization of products and product candidates. Such arrangements may require us to deliver various rights, services and/or goods, including intellectual property rights/licenses, R&D services, manufacturing services and/or commercialization services. The underlying terms of these arrangements generally provide for consideration to Amgen in the form of nonrefundable, upfront license fees; development and commercial performance milestone payments; royalty payments; and/or profit sharing. In arrangements involving more than one performance obligation, each required performance obligation is evaluated to determine whether it qualifies as a distinct performance obligation based on whether (i) the customer can benefit from the good or service either on its own or together with other resources that are readily available and (ii) the good or service is separately identifiable from other promises in the contract. The consideration under the arrangement is then allocated to each separate distinct performance obligation based on its respective relative stand-alone selling price. The estimated selling price of each deliverable reflects our best estimate of what the selling price would be if the deliverable was regularly sold by us on a stand-alone basis or by using an adjusted market assessment approach if selling price on a stand-alone basis is not available. The consideration allocated to each distinct performance obligation is recognized as revenue when control of the related goods or services is transferred. Consideration associated with at-risk substantive performance milestones is recognized as revenue when it is probable that a significant reversal of the cumulative revenue recognized will not occur. We utilize the sales- and usage-based royalty exception in arrangements that resulted from the license of intellectual property, recognizing revenues generated from royalties or profit sharing as the underlying sales occur. Research and development costs R&D costs are expensed as incurred and primarily include salaries, benefits and other staff-related costs; facilities and overhead costs; clinical trial and related clinical manufacturing costs; contract services and other outside costs; information systems’ costs; and amortization of acquired technology used in R&D with alternative future uses. R&D expenses also include costs and cost recoveries associated with third-party R&D arrangements, including upfront fees and milestones paid to third parties in connection with technologies that had not reached technological feasibility and did not have an alternative future use. Net payment or reimbursement of R&D costs is recognized when the obligations are incurred or as we become entitled to the cost recovery. See Note 8, Collaborations. Selling, general and administrative costs SG&A costs are primarily composed of salaries, benefits and other staff-related costs associated with sales and marketing, finance, legal and other administrative personnel; facilities and overhead costs; outside marketing, advertising and legal expenses; the U.S. healthcare reform federal excise fee on Branded Prescription Pharmaceutical Manufacturers and Importers; and other general and administrative costs. Advertising costs are expensed as incurred and were $962 million, $789 million and $674 million during the years ended December 31, 2020, 2019 and 2018, respectively. SG&A expenses also include costs and cost recoveries associated with marketing and promotion efforts under certain collaborative arrangements. Net payment or reimbursement of SG&A costs is recognized when the obligations are incurred or we become entitled to the cost recovery. See Note 8, Collaborations. Leases Adoption of new lease standard In February 2016, the Financial Accounting Standards Board (FASB) issued a new accounting standard that amends the guidance for the accounting and disclosure of leases. This new standard requires that lessees recognize the assets and liabilities that arise from leases on the balance sheet, including leases classified as operating leases, and that they disclose qualitative and quantitative information about leasing arrangements. The FASB subsequently issued additional amendments to address issues arising from the implementation of the new lease standard. We adopted this standard as of January 1, 2019, using the modified-retrospective method, which provides a method for recording existing leases at adoption. We used the adoption date as our date of initial application, and thus, comparative-period financial information is not presented for periods prior to the adoption date. In addition, we elected the package of practical expedients permitted under the transition guidance within the new standard, which, among other things, allowed us to carry forward the historical lease classification. Adoption of the new standard resulted in total lease liabilities of $510 million and right-of-use (ROU) assets of $439 million as of January 1, 2019. The difference between the initial lease liabilities and the ROU assets is primarily related to previously existing lease liabilities. The standard did not materially impact our Consolidated Statements of Income and had no impact on our Consolidated Statements of Cash Flows. Our accounting policies under the new standard are described below. See Note 13, Leases. Lease recognition At inception of a contract, we determine whether an arrangement is or contains a lease. For all leases, we determine the classification as either operating or financing. Operating leases are included in Other assets, Accrued liabilities and Other noncurrent liabilities in our Consolidated Balance Sheets. ROU assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments under the lease. Lease recognition occurs at the commencement date, and lease liability amounts are based on the present value of lease payments made during the lease term. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Because most of our leases do not provide information to determine an implicit interest rate, we use our incremental borrowing rate in determining the present value of lease payments. ROU assets also include any lease payments made prior to the commencement date less lease incentives received. Operating lease expense is recognized on a straight-line basis over the lease term. We have lease agreements with both lease and nonlease components, which are generally accounted for together as a single lease component. In addition, for certain vehicle and equipment leases, we apply a portfolio approach to determine the lease term and discount rate. Stock-based compensation We have stock-based compensation plans under which various types of equity-based awards are granted, including restricted stock units (RSUs), performance units and stock options. The fair values of RSUs and stock option awards, which are subject only to service conditions with graded vesting, are recognized as compensation expense, generally on a straight-line basis over the service period, net of estimated forfeitures. The fair values of performance unit awards are recognized as compensation expense, generally on a straight-line basis from the grant date to the end of the performance period. See Note 4, Stock-based compensation. Income taxes We provide for income taxes based on pretax income and applicable tax rates in the various jurisdictions in which we operate. Significant judgment is required in determining our provision for income taxes and income tax assets and liabilities, including evaluating uncertainties in the application of accounting principles and complex tax laws. Deferred income taxes are recorded for the expected tax consequences of temporary differences between the bases of assets and liabilities, as well as for loss and tax credit carryforwards for financial reporting purposes and amounts recognized for income tax purposes. We record a valuation allowance to reduce our deferred tax assets to the amount of future tax benefit that is more likely than not to be realized. We recognize the tax benefit from an uncertain tax position only if it is more likely than not that the tax position will be sustained upon examination by tax authorities based on the technical merits of the position. The tax benefit recognized in the consolidated financial statements for a particular tax position is based on the largest benefit that is more likely than not to be realized. The amount of unrecognized tax benefits (UTBs) is adjusted as appropriate for changes in facts and circumstances, such as significant amendments to existing tax law, new regulations or interpretations by tax authorities, new information obtained during a tax examination or resolution of an examination. We recognize both accrued interest and penalties, where appropriate, related to UTBs in income tax expense. See Note 6, Income taxes. Acquisitions We first determine whether a set of assets acquired constitute a business and should be accounted for as a business combination. If the assets acquired are not a business, we account for the transaction as an asset acquisition. Business combinations are accounted for by using the acquisition method of accounting. Under the acquisition method, assets acquired, including in-process research and development (IPR&D) projects, and liabilities assumed are recorded at their respective fair values as of the acquisition date in our consolidated financial statements. The excess of the fair value of consideration transferred over the fair value of the net assets acquired is recorded as goodwill. Contingent consideration obligations incurred in connection with a business combination (including the assumption of an acquiree’s liability arising from an acquisition it consummated prior to our acquisition) are recorded at their fair values on the acquisition date and remeasured at their fair values each subsequent reporting period until the related contingencies are resolved. The resulting changes in fair values are recorded in earnings. In contrast, asset acquisitions are accounted for using a cost accumulation and allocation model. Under this model, the cost of the acquisition is allocated to the assets acquired and liabilities assumed. Contingent consideration obligations incurred in connection with an asset acquisition are recorded when it is probable that they will occur and they can be reasonably estimated. See Note 2, Acquisitions, and Note 17, Fair value measurement. Cash equivalents We consider cash equivalents to be only those investments that are highly liquid, readily convertible to cash and which mature within three months from the date of purchase. Interest-bearing securities We consider our interest-bearing securities investment portfolio available-for-sale, and accordingly, these investments are recorded at fair value, with unrealized gains and losses recorded in Accumulated other comprehensive income (loss) (AOCI). Investments with maturities beyond one year may be classified as short-term marketable securities in the Consolidated Balance Sheets due to their highly liquid nature and because they represent the Company’s investments that are available for current operations. See Note 9, Investments, and Note 17, Fair value measurement. Inventories Inventories are stated at the lower of cost or net realizable value. Cost, which includes amounts related to materials, labor and overhead, is determined in a manner that approximates the first-in, first-out method. Net realizable value is the estimated selling price in the ordinary course of business less reasonably predictable costs of completion, disposal and transportation. See Note 10, Inventories. Derivatives We recognize all of our derivative instruments as either assets or liabilities at fair value in the Consolidated Balance Sheets. The accounting for changes in the fair value of a derivative instrument depends on whether the derivative has been formally designated and qualifies as part of a hedging relationship under the applicable accounting standards and, further, on the type of hedging relationship. For derivatives formally designated as hedges, we assess both at inception and quarterly thereafter whether the hedging derivatives are highly effective in offsetting changes in either the fair value or cash flows of the hedged item. Our derivatives that are not designated and do not qualify as hedges are adjusted to fair value through current earnings. See Note 17, Fair value measurement, and Note 18, Derivative instruments. Property, plant and equipment, net Property, plant and equipment is recorded at historical cost, net of accumulated depreciation, amortization and, if applicable, impairment charges. We review our property, plant and equipment assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Depreciation is provided over the assets’ useful lives on a straight-line basis. Leasehold improvements are amortized on a straight-line basis over the shorter of their estimated useful lives or lease terms. See Note 11, Property, plant and equipment. Goodwill and other intangible assets Finite-lived intangible assets are recorded at cost, net of accumulated amortization, and, if applicable, impairment charges. Amortization of finite-lived intangible assets is provided over their estimated useful lives on a straight-line basis or based on the pattern in which economic benefits are consumed, if reliably determinable. We review our finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. See Note 12, Goodwill and other intangible assets. The fair values of IPR&D projects acquired in a business combination that are not complete are capitalized and accounted for as indefinite-lived intangible assets until completion or abandonment of the related R&D efforts. Upon successful completion of the project, the capitalized amount is amortized over its estimated useful life. If a project is abandoned, all remaining capitalized amounts are written off immediately. There are often major risks and uncertainties associated with IPR&D projects as we are required to obtain regulatory approvals in order to be able to market the resulting products. Such approvals require completing clinical trials that demonstrate a product candidate is safe and effective. Consequently, the eventual realized value of the acquired IPR&D project may vary from its fair value at the date of acquisition, and IPR&D impairment charges may occur in future periods. Capitalized IPR&D projects are tested for impairment annually and whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. We consider various factors for potential impairment, including the current legal and regulatory environment and the competitive landscape. Adverse clinical trial results, significant delays in obtaining marketing approval, the inability to bring a product to market and the introduction or advancement of competitors’ products could result in partial or full impairment of the related intangible assets. We perform an impairment test of goodwill annually and whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. To date, an impairment of goodwill has not been recorded. See Note 12, Goodwill and other intangible assets. Contingencies In the ordinary course of business, we are involved in various legal proceedings, government investigations and other matters that are complex in nature and have outcomes that are difficult to predict. Certain of these proceedings are discussed in Note 19, Contingencies and commitments. We record accruals for loss contingencies to the extent that we conclude that it is probable that a liability has been incurred and the amount of the related loss can be reasonably estimated. We evaluate, on a quarterly basis, developments in legal proceedings and other matters that could cause an increase or decrease in the amount of the liability that has been accrued previously. Foreign currency translation The net assets of international subsidiaries whose local currencies have been determined to be the functional currencies are translated into U.S. dollars using current exchange rates. The U.S. dollar effects that arise from translating net assets of these subsidiaries at changing rates are recognized in AOCI. The subsidiaries’ earnings are translated into U.S. dollars using average exchange rates. Equity method investments The equity method of accounting is used for equity investments that give us the ability to exert significant influence, but not control, over an investee based on such factors as our ownership percentage, voting and other shareholder rights, board of director representation and the existence of other collaborative or business relationships. The equity method of accounting requires us to allocate the difference between the fair value of securities acquired and our proportionate share of the carrying value of the underlying assets (the basis difference) to various items and amortize such differences over their useful lives. Our share of the investees’ earnings or losses and amortization of basis differences, if any, are recorded one quarter in arrears in Interest and other income, net, in the Consolidated Statements of Income. We record impairment losses on our equity method investments if we deem the impairment to be other-than-temporary. We deem an impairment to be other-than-temporary based on various factors, including but not limited to, the length of time the fair value is below the carrying value, volatility of the security price and our intent and ability to retain the investment to allow for a recovery in fair value. Recent accounting pronouncements In June 2016, the FASB issued a new accounting standard that amends the guidance for measuring and recording credit losses on financial assets measured at amortized cost by replacing the incurred-loss model with an expected-loss model. Accordingly, these financial assets are now presented at the net amount expected to be collected. This new standard also requires that credit losses related to available-for-sale debt securities be recorded as an allowance through net income rather than reducing the carrying amount under the former other-than-temporary-impairment model. We adopted this standard as of January 1, 2020, using a modified-retrospective approach. Adoption of the standard did not have a material impact on our consolidated financial statements. In March 2020, the FASB issued a new accounting standard to ease the financial reporting burdens of the expected market transition from the London Interbank Offered Rate (LIBOR) and other interbank offered rates to alternative reference rates, commonly referred to as reference rate reform. The new standard provides temporary optional expedients and exceptions to current GAAP guidance on contract modifications and hedge accounting. Specifically, a modification to transition to an alternative reference rate is treated as an event that does not require contract remeasurement or reassessment of a previous accounting treatment. Moreover, for all types of hedging relationships, an entity may change the reference rate without having to dedesignate the hedging relationship. The standard is generally effective for all contract modifications made and hedging relationships evaluated through December 31, 2022. In January 2021, the FASB issued a new accounting standard to expand on the scope of the original March 2020 standard to include derivative instruments on discounting transactions. We are currently evaluating the impact that both standards will have on our consolidated financial statements. |
Acquisitions
Acquisitions | 3 Months Ended |
Mar. 31, 2018 | |
Business Combinations [Abstract] | |
Business combinations | Acquisitions Otezla ® (apremilast) On November 21, 2019, we acquired worldwide rights to Otezla ® , the only oral, non-biologic treatment for psoriasis and psoriatic arthritis, along with certain related assets and liabilities, from Celgene Corporation (Celgene). Otezla ® is primarily used for the treatment of patients with moderate-to-severe plaque psoriasis for whom phototherapy or systemic therapy is appropriate and is approved in more than 50 markets outside the United States, including the European Union and Japan. The acquisition was accounted for as an asset acquisition under GAAP because substantially all of the value of the assets acquired was concentrated in the global intellectual property rights of Otezla ® . The operations of Otezla ® have been included in our consolidated financial statements commencing on the acquisition date. The following table summarizes the consideration transferred and the allocation of the estimated accumulated cost, including tax adjustments, to the assets acquired and liabilities assumed (in millions): Amounts Cash purchase price $ 13,400 Transaction costs 40 Accumulated cost (consideration transferred) $ 13,440 Intangible assets: Developed-product-technology rights $ 13,007 Marketing-related rights 195 Inventory 367 Deferred tax liability, net (24) Deferred credit (96) Other liabilities, net (9) Total assets acquired, net $ 13,440 Amgen allocated the accumulated cost of the acquisition to the assets acquired based on their relative fair values. The accumulated cost of the acquisition includes direct acquisition-related costs and applicable taxes. Goodwill is not recognized in the accounting for an asset acquisition. Rather, the excess of the accumulated cost over the fair value of the net assets acquired is reallocated to the nonfinancial assets acquired. The developed-product-technology rights acquired relate to Otezla ® . The estimated fair value was determined by using a multi-period excess earnings income approach, which is based on the present value of the incremental after-tax cash flows attributable only to the intangible asset. The developed-product-technology rights will be amortized over a weighted-average period of 8.5 years by using the straight-line method. The estimated fair value of marketing-related rights, which relate to assembled workforce, was determined using a replacement cost approach, which consists of developing an estimate of the current cost of a similar new asset having the nearest equivalent utility to the asset being valued. The assembled workforce will be amortized over a period of 5 years by using the straight-line method. The estimated fair value of the acquired inventory was determined using the comparative sales method, which uses actual or expected selling prices of inventory as the base amount to which adjustments for selling effort and a profit on the buyer’s effort are applied. Inventory fair value adjustments will be amortized as inventory turns over, which we estimate to approximate 2.5 years. Upon closing, we had a difference between the book basis and tax basis of the assets acquired. The Company used the simultaneous equations method to determine the assigned value of the net assets acquired and the related deferred tax assets or liabilities. Use of this methodology resulted in an increase to the carrying value of the intangible assets of $119 million, a net deferred tax liability of $24 million and a deferred credit of $96 million. The tax effects of the acquisition are based on Amgen’s estimated blended statutory tax rate of 20%. Nuevolution AB On July 15, 2019, we acquired all of the outstanding stock of Nuevolution AB (Nuevolution), a publicly traded, Denmark-based biotechnology company with a leading small molecule drug discovery platform, for total consideration of $183 million in cash. The transaction, which was accounted for as a business combination, expands our ability to discover novel small molecules against difficult-to-drug targets and with greater speed and efficiency. Nuevolution’s operations, which are not material, have been included in our consolidated financial statements commencing on the acquisition date. We allocated the consideration to acquire Nuevolution to finite-lived intangible assets of $150 million, primarily comprised of technology rights for a drug discovery platform with an estimated useful life of 10 years; goodwill of $26 million, which is not tax deductible; deferred tax liabilities of $22 million; and other net assets of $29 million. The estimated fair values of intangible assets were determined primarily by using a probability-weighted-income approach, which discounts expected future cash flows to present value by using a discount rate that represents the estimated rate that market participants would use to value the intangible assets. Kirin-Amgen, Inc. During the first quarter of 2018, we acquired the remaining 50% ownership of Kirin-Amgen, Inc. (K-A), from Kirin Holdings Company, Limited (Kirin), making K-A a wholly owned subsidiary of Amgen. Upon the acquisition, K-A’s operations have been included in our consolidated financial statements commencing on the share acquisition date. The acquisition relieved Amgen of future royalty obligations to K-A. Prior to the share acquisition date, we owned 50% of K-A and accounted for our interest in K-A by using the equity method of accounting. The transaction was accounted for as a step acquisition of a business in which we were required to remeasure our existing 50% ownership interest at fair value. In addition, we were required to effectively settle our preexisting relationship with K-A, which resulted in a loss. Together the gain on the remeasurement of our existing ownership interest and the loss from the settlement of the preexisting relationship resulted in a net gain of $80 million, which was recorded in Interest and other income, net, in the Consolidated Statements of Income. The primary means of consideration for this transaction was a payment of $780 million in cash. The aggregate share acquisition date consideration to acquire the remaining 50% ownership in K-A and the fair value of Amgen’s preacquisition investment consisted of the following (in millions): Amounts Total cash paid to Kirin $ 780 Fair value of contingent consideration obligation 45 Loss on settlement of preexisting relationship (168) Total consideration transferred to acquire K-A 657 Fair value of Amgen’s investment in K-A 825 Total acquisition date fair value $ 1,482 In connection with this acquisition, we are obligated to make single-digit royalty payments to Kirin contingent upon sales of brodalumab. The estimated fair value of this contingent consideration obligation was $45 million as of the share acquisition date. The fair values of assets acquired and liabilities assumed consisted of cash of $977 million, licensing rights of $470 million, deferred tax liabilities of $102 million, other assets and liabilities of $131 million and goodwill of $6 million. The estimated fair value of acquired licensing rights was determined by using a probability-related-income approach, which is based on the present value of the incremental after-tax cash flows attributable only to the intangible asset. The projected cash flows were based on certain assumptions, including estimates of future revenues and expenses and the time and resources needed to maintain the assets through commercialization. The licensing rights will be amortized over a weighted-average period of four years by using the straight-line method. The excess of the share acquisition date consideration over the fair values assigned to the assets acquired and the liabilities assumed of $6 million was recorded as goodwill, which is not deductible for tax purposes. The $131 million in other assets and liabilities primarily represents receivables for royalties earned by K-A but not yet received, partially offset by payables representing R&D expenses incurred but not yet reimbursed by K-A. Pro forma results of operations for this acquisition have not been presented because this acquisition was not material to our consolidated results of operations. |
Revenues
Revenues | 12 Months Ended |
Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues We operate in one business segment: human therapeutics. Therefore, results of our operations are reported on a consolidated basis for purposes of segment reporting, consistent with internal management reporting. Revenues by product and by geographic area, based on customers’ locations, are presented below. The majority of rest-of-world (ROW) revenues relates to products sold in Europe. Revenues were as follows (in millions): Year ended December 31, 2020 Year ended December 31, 2019 Year ended December 31, 2018 U.S. ROW Total U.S. ROW Total U.S. ROW Total Enbrel ® (etanercept) $ 4,855 $ 141 $ 4,996 $ 5,050 $ 176 $ 5,226 $ 4,807 $ 207 $ 5,014 Prolia ® (denosumab) 1,830 933 2,763 1,772 900 2,672 1,500 791 2,291 Neulasta ® (pegfilgrastim) 2,001 292 2,293 2,814 407 3,221 3,866 609 4,475 Otezla ®(1) 1,790 405 2,195 139 39 178 — — — XGEVA ® (denosumab) 1,405 494 1,899 1,457 478 1,935 1,338 448 1,786 Aranesp ® (darbepoetin alfa) 629 939 1,568 758 971 1,729 942 935 1,877 KYPROLIS ® (carfilzomib) 710 355 1,065 654 390 1,044 583 385 968 Repatha ® (evolocumab) 459 428 887 376 285 661 358 192 550 Other products 4,306 2,268 6,574 3,511 2,027 5,538 4,035 1,537 5,572 Total product sales (2) 17,985 6,255 24,240 16,531 5,673 22,204 17,429 5,104 22,533 Other revenues 511 673 1,184 693 465 1,158 929 285 1,214 Total revenues $ 18,496 $ 6,928 $ 25,424 $ 17,224 $ 6,138 $ 23,362 $ 18,358 $ 5,389 $ 23,747 ____________ (1) Otezla ® was acquired on November 21, 2019. (2) Hedging gains and losses, which are included in product sales, were not material for the years ended December 31, 2020, 2019 and 2018. In the United States, we sell primarily to pharmaceutical wholesale distributors that we utilize as the principal means of distributing our products to healthcare providers. Outside the United States, we sell principally to healthcare providers and/or pharmaceutical wholesale distributors depending on the distribution practice in each country. We monitor the financial condition of our larger customers and limit our credit exposure by setting credit limits and, in certain circumstances, by requiring letters of credit or obtaining credit insurance. We had product sales to three customers, each of them accounting for more than 10% of total revenues for each of the years ended December 31, 2020, 2019 and 2018. For the year ended December 31, 2020, on a combined basis, these customers accounted for 83% of total gross revenues as shown in the following table. Certain information with respect to these customers was as follows (dollar amounts in millions): Years ended December 31, 2020 2019 2018 AmerisourceBergen Corporation: Gross product sales $ 14,743 $ 12,301 $ 12,091 % of total gross revenues 34 % 33 % 33 % McKesson Corporation: Gross product sales $ 13,779 $ 11,795 $ 11,434 % of total gross revenues 32 % 31 % 31 % Cardinal Health, Inc.: Gross product sales $ 7,332 $ 6,538 $ 7,475 % of total gross revenues 17 % 17 % 20 % As of December 31, 2020 and 2019, amounts due from these three customers each exceeded 10% of gross trade receivables and accounted for 74% and 73%, respectively, of net trade receivables on a combined basis. As of December 31, 2020 and 2019, 28% and 27%, respectively, of net trade receivables were due from customers located outside the United States, the majority of which were from Europe. Our total allowance for doubtful accounts as of December 31, 2020 and 2019, was not material. |
Stock-based compensation
Stock-based compensation | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock-based compensation | Stock-based compensation Our Amended and Restated 2009 Equity Incentive Plan (the Amended 2009 Plan) authorizes for issuance to employees of Amgen and nonemployee members of our Board of Directors shares of our common stock pursuant to grants of equity-based awards, including RSUs, stock options and performance units. The pool of shares available under the Amended 2009 Plan is reduced by one share for each stock option granted and by 1.9 shares for other types of awards granted, including RSUs and performance units (full-value awards). In general, if any shares subject to an award granted under the Amended 2009 Plan expire or become forfeited, terminated or canceled without the issuance of shares, the shares subject to such awards are added back into the authorized pool on the same basis that they were removed. In addition, under the Amended 2009 Plan, shares withheld to pay for minimum statutory tax obligations with respect to full-value awards are added back into the authorized pool on the basis of 1.9 shares. As of December 31, 2020, the Amended 2009 Plan provides for future grants and/or issuances of up to approximately 23 million shares of our common stock. Stock-based awards under our employee compensation plans are made with newly issued shares reserved for this purpose. The following table reflects the components of stock-based compensation expense recognized in our Consolidated Statements of Income (in millions): Years ended December 31, 2020 2019 2018 RSUs $ 178 $ 168 $ 165 Performance units 118 105 117 Stock options 34 35 29 Total stock-based compensation expense, pretax 330 308 311 Tax benefit from stock-based compensation expense (72) (67) (67) Total stock-based compensation expense, net of tax $ 258 $ 241 $ 244 Restricted stock units and stock options Eligible employees generally receive an annual grant of RSUs and, for certain executive-level employees, stock options, with the size and type of award generally determined by the employee’s salary grade and performance level. Certain management and professional-level employees typically receive RSU grants upon commencement of employment. Nonemployee members of our Board of Directors also receive an annual grant of RSUs. Our RSU and stock option grants provide for accelerated or continued vesting in certain circumstances as defined in the plans and related grant agreements, including upon death, disability, termination in connection with a change in control and the retirement of employees who meet certain service and/or age requirements. RSUs and stock options generally vest in equal amounts on the second, third and fourth anniversaries of the grant date. RSUs accrue dividend equivalents, which are typically payable in shares only when and to the extent the underlying RSUs vest and are issued to the recipient. Restricted stock units The grant date fair value of an RSU equals the closing price of our common stock on the grant date, as RSUs accrue dividend equivalents during their vesting period. The weighted-average grant date fair values per unit of RSUs granted during the years ended December 31, 2020, 2019 and 2018, were $235.63, $182.12 and $179.18, respectively. The following table summarizes information regarding our RSUs: Year ended December 31, 2020 Units Weighted-average Balance nonvested as of December 31, 2019 3.1 $ 174.97 Granted 1.1 $ 235.63 Vested (1.0) $ 167.23 Forfeited (0.2) $ 190.15 Balance nonvested as of December 31, 2020 3.0 $ 198.11 The total grant date fair values of RSUs that vested during the years ended December 31, 2020, 2019 and 2018, were $161 million, $160 million and $167 million, respectively. Stock options The exercise price of stock options is set as the closing price of our common stock on the grant date, and the related number of shares granted is fixed at that point in time. Awards expire 10 years from the date of grant. We use the Black–Scholes option valuation model to estimate the grant date fair value of stock options. The weighted-average assumptions used in the option valuation model and the resulting weighted-average grant date fair values of stock options granted were as follows: Years ended December 31, 2020 2019 2018 Closing price of our common stock on grant date $ 236.36 $ 177.31 $ 177.46 Expected volatility (average of implied and historical volatility) 28.1 % 23.5 % 24.6 % Expected life (in years) 5.8 5.8 5.8 Risk-free interest rate 0.4 % 2.4 % 2.8 % Expected dividend yield 3.0 % 3.1 % 2.9 % Fair value of stock options granted $ 42.34 $ 30.47 $ 34.60 The following table summarizes information regarding our stock options: Year ended December 31, 2020 Options Weighted- Weighted- Aggregate Balance unexercised as of December 31, 2019 4.8 $ 157.00 Granted 1.0 $ 236.36 Exercised (0.9) $ 117.90 Expired/forfeited (0.2) $ 178.36 Balance unexercised as of December 31, 2020 4.7 $ 179.90 7.3 $ 243 Vested or expected to vest as of December 31, 2020 4.5 $ 178.37 7.3 $ 239 Exercisable as of December 31, 2020 1.5 $ 150.80 5.5 $ 120 The total intrinsic values of options exercised during the years ended December 31, 2020, 2019 and 2018, were $98 million, $68 million and $53 million, respectively. The actual tax benefits realized from tax deductions from option exercises during the years ended December 31, 2020, 2019 and 2018, were $21 million, $15 million and $12 million, respectively. As of December 31, 2020, $345 million of unrecognized compensation cost was related to nonvested RSUs and unvested stock options, which is expected to be recognized over a weighted-average period of 1.8 years. Performance units Certain management-level employees also receive annual grants of performance units, which give the recipient the right to receive common stock that is contingent upon achievement of specified preestablished goals over the performance period, which is generally three years. The performance goals for the units granted during the years ended December 31, 2020, 2019 and 2018, which are accounted for as equity awards, are based on (i) Amgen’s stockholder return compared with a comparator group of companies, which are considered market conditions and are therefore reflected in the grant date fair values of the units, and (ii) Amgen’s stand-alone financial performance measures, which are considered performance conditions. The expense recognized for awards is based on the grant date fair value of a unit multiplied by the number of units expected to be earned with respect to the related performance conditions, net of estimated forfeitures. Depending on the outcome of these performance goals, a recipient may ultimately earn a number of units greater or less than the number of units granted. Shares of our common stock are issued on a one-for-one basis for each performance unit earned. In general, performance unit awards vest at the end of the performance period. The performance award program provides for accelerated or continued vesting in certain circumstances as defined in the plan, including upon death, disability, a change in control and retirement of employees who meet certain service and/or age requirements. Performance units accrue dividend equivalents that are typically payable in shares only when and to the extent the underlying performance units vest and are issued to the recipient, including with respect to market and performance conditions that affect the number of performance units earned. We use a payout simulation model to estimate the grant date fair value of performance units. The weighted-average assumptions used in the payout simulation model and the resulting weighted-average grant date fair values of performance units granted were as follows: Years ended December 31, 2020 2019 2018 Closing price of our common stock on grant date $ 236.36 $ 177.31 $ 177.93 Volatility 27.5 % 22.1 % 23.8 % Risk-free interest rate 0.2 % 2.3 % 2.6 % Fair value of units granted $ 249.07 $ 188.40 $ 189.21 The payout simulation model assumes correlations of returns of the stock prices of our common stock and the common stocks of the comparator groups of companies and stock price volatilities of the comparator groups of companies to simulate stockholder returns over the performance periods and their resulting impact on the payout percentages based on the contractual terms of the performance units. As of December 31, 2020 and 2019, 1.8 million and 2.0 million performance units were outstanding with weighted-average grant date fair values per unit of $207.52 and $185.64 per unit, respectively. During the year ended December 31, 2020, 0.6 million performance units with a weighted-average grant date fair value per unit of $249.07 were granted, and 0.1 million performance units with a weighted-average grant date fair value per unit of $199.86 were forfeited. The total fair values of performance units paid during the years ended December 31, 2020, 2019 and 2018 were $230 million, $176 million and $133 million, respectively, based on the number of performance units earned multiplied by the closing stock price of our common stock on the last day of the performance period. |
Defined contribution plan
Defined contribution plan | 12 Months Ended |
Dec. 31, 2020 | |
Retirement Benefits [Abstract] | |
Defined contribution plan | Defined contribution planThe Company has defined contribution plans to which certain employees of the Company and participating subsidiaries may defer compensation for income tax purposes. Participants are eligible to receive matching contributions based on their contributions, in addition to other Company contributions. Defined contribution plan expenses were $231 million, $220 million and $173 million for the years ended December 31, 2020, 2019 and 2018, respectively. |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income taxes | Income taxes Income before income taxes included the following (in millions): Years ended December 31, 2020 2019 2018 Domestic $ 4,087 $ 4,371 $ 4,856 Foreign 4,046 4,767 4,689 Total income before income taxes $ 8,133 $ 9,138 $ 9,545 The provision for income taxes included the following (in millions): Years ended December 31, 2020 2019 2018 Current provision: Federal $ 921 $ 1,284 $ 1,270 State 34 39 17 Foreign 277 277 227 Total current provision 1,232 1,600 1,514 Deferred (benefit) provision: Federal (321) (276) (317) State 9 (22) (7) Foreign (51) (6) (39) Total deferred benefit (363) (304) (363) Total provision for income taxes $ 869 $ 1,296 $ 1,151 Deferred income taxes reflect the tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, tax credit carryforwards and the tax effects of net operating loss (NOL) carryforwards. Significant components of our deferred tax assets and liabilities were as follows (in millions): December 31, 2020 2019 Deferred income tax assets: NOL and credit carryforwards $ 794 $ 800 Accrued expenses 561 457 Expenses capitalized for tax 144 170 Stock-based compensation 92 91 Other 301 269 Total deferred income tax assets 1,892 1,787 Valuation allowance (571) (517) Net deferred income tax assets 1,321 1,270 Deferred income tax liabilities: Acquired intangible assets (903) (1,288) Debt (282) (210) Fixed assets (148) (53) Other (189) (233) Total deferred income tax liabilities (1,522) (1,784) Total deferred income taxes, net $ (201) $ (514) Valuation allowances are provided to reduce the amounts of our deferred tax assets to an amount that is more likely than not to be realized based on an assessment of positive and negative evidence, including estimates of future taxable income necessary to realize future deductible amounts. The valuation allowance increased in 2020, primarily driven by the Company’s expectation that some state R&D credits will not be utilized and that certain foreign net operating losses will expire unused. As of December 31, 2020, we had $20 million of federal tax credit carryforwards available to reduce future federal income taxes and have provided no valuation allowance for those federal tax credit carryforwards. The federal tax credit carryforwards expire between 2023 and 2035. We had $681 million of state tax credit carryforwards available to reduce future state income taxes and have provided a valuation allowance for $585 million of those state tax credit carryforwards. As of December 31, 2020, we had $143 million of federal NOL carryforwards available to reduce future federal income taxes and have provided a valuation allowance for $6 million of those federal NOL carryforwards. The federal NOL carryforwards, for which no valuation allowance has been provided, expire between 2021 and 2035. We had $167 million of state NOL carryforwards available to reduce future state income taxes and have provided a valuation allowance for all of the state NOL carryforwards. We had $1.9 billion of foreign NOL carryforwards available to reduce future foreign income taxes and have provided a valuation allowance for $754 million of those foreign NOL carryforwards. For the foreign NOLs with no valuation allowance provided, $861 million has no expiry; and the remainder will expire between 2021 and 2030. The reconciliations of the total gross amounts of UTBs were as follows (in millions): Years ended December 31, 2020 2019 2018 Beginning balance $ 3,287 $ 3,061 $ 2,953 Additions based on tax positions related to the current year 165 215 173 Additions based on tax positions related to prior years 3 22 13 Reductions for tax positions of prior years (35) (11) (17) Settlements (68) — (61) Ending balance $ 3,352 $ 3,287 $ 3,061 Substantially all of the UTBs as of December 31, 2020, if recognized, would affect our effective tax rate. During the year ended December 31, 2020, we effectively settled certain issues with the IRS. As a result, we remeasured our UTBs accordingly. Interest and penalties related to UTBs are included in our provision for income taxes. During the years ended December 31, 2020, 2019 and 2018, we recognized $116 million, $198 million and $137 million, respectively, of interest and penalties through the income tax provision in the Consolidated Statements of Income. The decrease in interest expense for the year ended December 31, 2020 was primarily due to lower interest rates during 2020. As of December 31, 2020 and 2019, accrued interest and penalties associated with UTBs were $783 million and $667 million, respectively. The reconciliations between the federal statutory tax rate applied to income before income taxes and our effective tax rate were as follows: Years ended December 31, 2020 2019 2018 Federal statutory tax rate 21.0 % 21.0 % 21.0 % Foreign earnings (4.7) % (4.5) % (4.3) % Foreign-derived intangible income (0.7) % (0.7) % (0.4) % Credits, Puerto Rico Excise Tax (2.9) % (2.6) % (2.5) % 2017 Tax Act, net impact on intercompany sales — % — % (1.8) % Interest on uncertain tax positions 1.1 % 1.6 % 1.2 % Credits, primarily federal R&D (1.4) % (1.0) % (0.8) % Audit settlements (1.0) % — % (0.3) % Other, net (0.7) % 0.4 % — % Effective tax rate 10.7 % 14.2 % 12.1 % The effective tax rates for the years ended December 31, 2020, 2019 and 2018 differ from the federal statutory rate primarily due to impacts of the jurisdictional mix of income and expenses. Substantially all of the benefit to our effective tax rate from foreign earnings results from the Company’s operations in Puerto Rico, a territory of the United States that is treated as a foreign jurisdiction for U.S. tax purposes. Our operations in Puerto Rico are subject to tax incentive grants through 2035. Additionally, the Company’s operations conducted in Singapore are subject to a tax incentive grant through 2034. Our foreign earnings are also subject to U.S. tax at a reduced rate of 10.5%. The U.S. territory of Puerto Rico imposes an excise tax on the gross intercompany purchase price of goods and services from our manufacturing site in Puerto Rico. The rate of 4% is effective through December 31, 2027. We account for the excise tax as a manufacturing cost that is capitalized in inventory and expensed in cost of sales when the related products are sold. For U.S. income tax purposes, the excise tax results in foreign tax credits that are generally recognized in our provision for income taxes when the excise tax is incurred. Income taxes paid during the years ended December 31, 2020, 2019 and 2018, were $1.4 billion, $1.9 billion and $1.9 billion, respectively. One or more of our legal entities file income tax returns in the U.S. federal jurisdiction, various U.S. state jurisdictions and certain foreign jurisdictions. Our income tax returns are routinely examined by tax authorities in those jurisdictions. Significant disputes may arise with tax authorities involving issues regarding the timing and amount of deductions, the use of tax credits and allocations of income and expenses among various tax jurisdictions because of differing interpretations of tax laws, regulations and relevant facts. In 2017, we received a Revenue Agent Report (RAR) and a modified RAR from the Internal Revenue Service (IRS) for the years 2010, 2011 and 2012 proposing significant adjustments that primarily relate to the allocation of profits between certain of our entities in the United States and the U.S. territory of Puerto Rico. We disagree with the proposed adjustments and calculations and have been pursuing resolution with the IRS administrative appeals office. However, we have been unable to reach resolution at the administrative appeals level, and we anticipate that we will receive a Notice of Deficiency, which we would expect to vigorously contest through the judicial process. In addition, in 2020, we received an RAR and a modified RAR from the IRS for the years 2013, 2014 and 2015 also proposing significant adjustments that primarily relate to the allocation of profits between certain of our entities in the United States and the U.S. territory of Puerto Rico similar to those proposed for the years 2010, 2011 and 2012. We disagree with the 2013, 2014 and 2015 proposed adjustments and calculations and are pursuing resolution with the IRS administrative appeals office. The IRS audit for years 2016, 2017 and 2018 is expected to start in the near term. We are also currently under examinat ion by a number of other state and foreign tax jurisdictions. Final resolution of these complex matters is not likely within the next 12 months. We believe our accrual for income tax liabilities is appropriate based on past experience, interpretations of tax law, application of the tax law to our facts and judgments about potential actions by tax authorities; however, due to the complexity of the provision for income taxes and uncertain resolution of these matters, the ultimate outcome of any tax matters may result in payments substantially greater than amounts accrued and could have a material adverse impact on our consolidated financial statements. We are no longer subject to U.S. federal income tax examinations for years ended on or before December 31, 2009. |
Earnings per share
Earnings per share | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings per share | Earnings per share The computation of basic earnings per share (EPS) is based on the weighted-average number of our common shares outstanding. The computation of diluted EPS is based on the weighted-average number of our common shares outstanding and dilutive potential common shares, which primarily include shares that may be issued under our stock option, restricted stock and performance unit award programs (collectively, dilutive securities), as determined by using the treasury stock method. The computations for basic and diluted EPS were as follows (in millions, except per-share data): Years ended December 31, 2020 2019 2018 Income (Numerator): Net income for basic and diluted EPS $ 7,264 $ 7,842 $ 8,394 Shares (Denominator): Weighted-average shares for basic EPS 586 605 661 Effect of dilutive securities 4 4 4 Weighted-average shares for diluted EPS 590 609 665 Basic EPS $ 12.40 $ 12.96 $ 12.70 Diluted EPS $ 12.31 $ 12.88 $ 12.62 For each of the three years ended December 31, 2020, the number of antidilutive employee stock-based awards excluded from the computation of diluted EPS was not significant. |
Collaborations
Collaborations | 12 Months Ended |
Dec. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Collaborations | Collaborations A collaborative arrangement is a contractual arrangement that involves a joint operating activity. Such arrangements involve two or more parties that are both (i) active participants in the activity and (ii) exposed to significant risks and rewards dependent on the commercial success of the activity. From time to time, we enter into collaborative arrangements for the R&D, manufacture and/or commercialization of products and/or product candidates. These collaborations generally provide for nonrefundable upfront license fees, development and commercial-performance milestone payments, cost sharing, royalty payments and/or profit sharing. Our collaboration arrangements are performed with no guarantee of either technological or commercial success, and each arrangement is unique in nature. See Note 1, Summary of significant accounting policies, for additional discussion of revenues recognized for these types of arrangements. Operating expenses for costs incurred pursuant to these arrangements are reported in their respective expense line items in the Consolidated Statements of Income, net of any payments due to or reimbursements due from our collaboration partners, with such reimbursements being recognized at the time the party becomes obligated to pay. Our significant arrangements are discussed below. BeiGene, Ltd. On January 2, 2020, we acquired a 20.5% stake in BeiGene, Ltd. (BeiGene), for approximately $2.8 billion in cash as part of a collaboration to expand our oncology presence in China. Under the collaboration, BeiGene commenced selling XGEVA ® and will commercialize KYPROLIS ® and BLINCYTO ® (blinatumomab) in China, and Amgen will share profits and losses equally during the initial product-specific commercialization periods; thereafter, product rights may revert to Amgen, and Amgen will pay royalties to BeiGene on sales in China of such products for a specified period. In addition, we will jointly develop a portion of our oncology portfolio with BeiGene sharing in global R&D costs by providing cash and development services up to $1.25 billion. Upon regulatory approval, BeiGene will assume commercialization rights in China for a specified period, and Amgen and BeiGene will share profits equally until certain of these product rights revert to Amgen. Upon return of the product rights, Amgen will pay royalties to BeiGene on sales in China for a specified period. For product sales outside of China, Amgen will also pay BeiGene royalties. During the year ended December 31, 2020, net costs recovered from BeiGene for oncology product candidates were $225 million and were recorded as an offset to R&D expense in the Consolidated Statements of Income. Profit share payments and product sales between Amgen and BeiGene were not material for the year ended December 31, 2020. As of December 31, 2020, the amount owed from BeiGene for net costs recovered was $113 million, which is included in Other current assets in the Consolidated Balance Sheets. In connection with this collaboration, we acquired an ownership interest in BeiGene. See Note 9, Investments. Novartis Pharma AG We are in a collaboration with Novartis Pharma AG (Novartis) to jointly develop and commercialize Aimovig ® (erenumab-aooe). In the United States, Amgen and Novartis jointly develop and collaborate on the commercialization of Aimovig ® . Amgen, as the principal, recognizes product sales of Aimovig ® in the United States, shares U.S. commercialization costs with Novartis and pays Novartis a significant royalty on net sales in the United States. Novartis holds global co-development rights and exclusive commercial rights outside the United States and Japan for Aimovig ® . Novartis pays Amgen double-digit royalties on net sales of the product in the Novartis exclusive territories and funds a portion of global R&D expenses. In addition, Novartis will make a payment to Amgen of up to $100 million if certain commercial and expenditure thresholds are achieved with respect to Aimovig ® in the United States. Amgen manufactures and supplies Aimovig ® worldwide. The migraine collaboration will continue for the commercial life of the product unless terminated in accordance with its terms. We are currently involved in litigation with Novartis over our collaboration agreements for the development and commercialization of Aimovig ® . See Note 19, Contingencies and commitments. During the years ended December 31, 2020 and 2019, net costs recovered from Novartis for migraine products were $192 million and $187 million, respectively, and were recorded primarily in SG&A expense in the Consolidated Statements of Income. During the year ended December 31, 2018, net costs paid to Novartis for migraine products were $44 million and were recorded primarily in SG&A expense in the Consolidated Statements of Income. During the years ended December 31, 2020, 2019, and 2018, royalties due to Novartis for Aimovig ® were $139 million, $115 million and $43 million, respectively, and were recorded in Cost of sales in the Consolidated Statements of Income. During the years ended December 31, 2020, 2019 and 2018, royalties due from Novartis for Aimovig ® were not material. As a result of certain regulatory and commercial events, we received milestone payments from Novartis of $295 million during the year ended December 31, 2018, which was recorded in Other revenues in the Consolidated Statements of Income. Bayer HealthCare LLC We are in a licensing arrangement with Bayer HealthCare LLC (Bayer) for Nexavar ® . Nexavar ® is currently marketed and sold in more than 100 countries around the world for the treatment of unresectable liver cancer and advanced kidney cancer. In the United States, Nexavar ® is also approved for the treatment of patients with locally recurrent or metastatic, progressive, differentiated thyroid carcinoma refractory to radioactive iodine treatment. In 2020, we amended the terms of our agreement with Bayer, which transferred all our operational responsibilities outside the United States to Bayer, including commercial and medical affairs activities. Prior to the amendment of the agreement, we shared equally in the profits outside the United States, excluding Japan. In lieu of this profit share, Bayer now pays us a royalty on sales of Nexavar ® at a percentage rate in the low 30s. The rights to develop and market Nexavar ® in Japan are reserved to Bayer. In the United States, Bayer pays us a royalty on sales of Nexavar ® at a percentage rate in the high 30s. The agreement with Bayer will terminate at the later of the date when patents expire that were issued in connection with product candidates discovered under the agreement or on the last day that we or Bayer market or sell products commercialized under the agreement anywhere in the world. Patents related to Nexavar ® began to expire in 2020. As a result of the 2020 amendment to the collaboration agreement, royalties due from Bayer for Nexavar ® were $217 million and net profits were not material for the year ended December 31, 2020. During the years ended December 31, 2019 and 2018, royalties due from Bayer for Nexavar ® were $79 million and $91 million, respectively. During the years ended December 31, 2019 and 2018, Amgen recorded Nexavar ® net profits of $210 million and $164 million, respectively. Royalties and profit share due from Nexavar ® were recorded in Other revenues in the Consolidated Statements of Income. Net R&D expenses related to the agreement were not material for the years ended December 31, 2020, 2019 and 2018. Other In addition to the collaborations discussed above, we have various other collaborations that are not individually significant to our business at this time. Pursuant to the terms of those agreements, we may be required to pay additional amounts or we may receive additional amounts upon the achievement of various development and commercial milestones, which in the aggregate could be significant. We may also incur or have reimbursed to us significant R&D costs if the related product candidate were to advance to late-stage clinical trials. In addition, if any products related to these collaborations are approved for sale, we may be required to pay significant royalties or we may receive significant royalties on future sales. The payment of these amounts, however, is contingent upon the occurrence of various future events, which have a high degree of uncertainty of occurrence. |
Investments
Investments | 12 Months Ended |
Dec. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments | Investments Available-for-sale investments The amortized cost, gross unrealized gains, gross unrealized losses and fair values of interest-bearing securities, all of which are considered available-for-sale, by type of security were as follows (in millions): Types of securities as of December 31, 2020 Amortized Gross Gross Fair U.S. Treasury notes $ 129 $ 1 $ — $ 130 U.S. Treasury bills 4,948 — — 4,948 Corporate debt securities: Financial — — — — Industrial — — — — Other — — — — Residential-mortgage-backed securities — — — — Money market mutual funds 4,765 — — 4,765 Other short-term interest-bearing securities 2 — — 2 Total available-for-sale investments $ 9,844 $ 1 $ — $ 9,845 Types of securities as of December 31, 2019 Amortized Gross Gross Fair U.S. Treasury notes $ 359 $ 1 $ — $ 360 U.S. Treasury bills — — — — Corporate debt securities: Financial 1,108 13 — 1,121 Industrial 824 10 — 834 Other 195 3 — 198 Residential-mortgage-backed securities 181 1 — 182 Money market mutual funds 5,250 — — 5,250 Other short-term interest-bearing securities 289 — — 289 Total available-for-sale investments $ 8,206 $ 28 $ — $ 8,234 The fair values of available-for-sale investments by location in the Consolidated Balance Sheets were as follows (in millions): December 31, Consolidated Balance Sheets locations 2020 2019 Cash and cash equivalents $ 5,464 $ 5,360 Marketable securities 4,381 2,874 Total available-for-sale investments $ 9,845 $ 8,234 Cash and cash equivalents in the above table excludes bank account cash of $802 million and $677 million as of December 31, 2020 and 2019, respectively. The fair values of available-for-sale investments by contractual maturity, except for mortgage- and asset-backed securities that do not have a single maturity date, were as follows (in millions): December 31, Contractual maturities 2020 2019 Maturing in one year or less $ 9,795 $ 5,629 Maturing after one year through three years 50 2,304 Maturing after three years through five years — 119 Residential-mortgage-backed securities — 182 Total available-for-sale investments $ 9,845 $ 8,234 For the years ended December 31, 2020, 2019 and 2018, realized gains on interest-bearing securities were $37 million, $92 million and $29 million, respectively, and realized losses on interest-bearing securities were $4 million, $36 million and $394 million, respectively. Realized gains and losses on interest-bearing securities are recorded in Interest and other income, net, in the Consolidated Statements of Income. The cost of securities sold is based on the specific-identification method. The primary objective of our investment portfolio is to maintain safety of principal, prudent levels of liquidity and acceptable levels of risk. Our investment policy limits interest-bearing security investments to certain types of debt and money market instruments issued by institutions with investment-grade credit ratings, and it places restrictions on maturities and concentration by asset class and issuer. We review our available-for-sale investments for declines in fair value below our cost basis each quarter or whenever circumstances indicate that the cost basis of an asset may not be recoverable and assess whether the decline was due to credit-related factors or other factors. Our evaluation is based on a number of factors, including the extent to which the fair value is below our cost basis as well as adverse conditions related specifically to the security, such as any changes to the credit rating of the security and the intent to sell or whether we will more likely than not be required to sell the security before recovery of its amortized cost basis. Our assessment of whether a security is impaired could change in the future based on new developments or changes in assumptions related to that particular security. Equity securities We held investments in equity securities with readily determinable fair values of $477 million and $303 million as of December 31, 2020 and 2019, respectively, which are included in Other assets in the Consolidated Balance Sheets. For the years ended December 31, 2020, 2019 and 2018, net unrealized gains on publicly traded securities were $174 million, $112 million and $24 million, respectively. Realized gains and losses on publicly traded securities for the years ended December 31, 2020, 2019 and 2018, were not material. We held investments of $203 million and $176 million in equity securities without readily determinable fair values as of December 31, 2020 and 2019, respectively, which are included in Other assets in the Consolidated Balance Sheets. Gains and losses recognized on these securities, including adjustments to the carrying values of these securities, were not material for the years ended December 31, 2020, 2019 and 2018. Equity Method Investments Limited partnership investments We held limited partnership investments of $496 million and $320 million as of December 31, 2020 and 2019, respectively, which are included in Other assets in the Consolidated Balance Sheets. These investments, primarily investment funds of early-stage biotechnology companies, are accounted for by using the equity method of accounting and are measured by using our proportionate share of the net asset values of the underlying investments held by the limited partnerships as a practical expedient. These investments are typically redeemable only through distributions upon liquidation of the underlying assets. As of December 31, 2020, unfunded additional commitments to be made for these investments during the next several years were not material. For the years ended December 31, 2020, 2019 and 2018 net gains recognized from our limited partnership investments were $241 million, $27 million and $91 million, respectively. BeiGene On January 2, 2020, we acquired a 20.5% ownership interest in BeiGene for $2.8 billion, of which $2.6 billion was attributed to the fair value of equity securities upon closing, with the remainder attributed to prepaid R&D. Our equity investment in BeiGene is included in Other assets in the Consolidated Balance Sheets. The fair value of equity securities acquired exceeded our proportionate share of the carrying value of the underlying net assets of BeiGene by approximately $2.4 billion. This investment is accounted for by using the equity method of accounting, which requires us to identify and allocate amounts to the items that give rise to the basis difference and to amortize these items over their useful lives. This amortization, along with our share of the results of operations of BeiGene, is included in Interest and other income, net, in our Consolidated Statements of Income. Recognition occurs one quarter in arrears, which began in the second quarter of 2020. The basis difference was allocated to finite-lived intangible assets, indefinite-lived intangible assets, equity-method goodwill and related deferred taxes. The finite-lived intangible assets are being amortized over a period ranging from 8 to 15 years. During the year ended December 31, 2020, we recognized an increase in the carrying value of our investment by purchasing additional shares to maintain our ownership interest for an aggregate cost of $569 million and recognized $34 million for the impact of other BeiGene ownership transactions. The carrying value of the investment during the year ended December 31, 2020, was reduced for our share of BeiGene’s net losses of $229 million and amortization of the basis difference of $109 million. As of December 31, 2020, the carrying value and fair value of our approximately 20.5% ownership interest in BeiGene totaled $2.9 billion and $4.9 billion, respectively. We believe that as of December 31, 2020, the carrying value of our equity investment in BeiGene is fully recoverable. For information on a collaboration agreement we entered into with BeiGene in connection with this investment, see Note 8, Collaborations. |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories Inventories consisted of the following (in millions): December 31, 2020 2019 Raw materials $ 486 $ 358 Work in process 2,437 2,227 Finished goods 970 999 Total inventories $ 3,893 $ 3,584 |
Property, plant and equipment
Property, plant and equipment | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property, plant and equipment | Property, plant and equipment Property, plant and equipment consisted of the following (dollar amounts in millions): December 31, Useful life (in years) 2020 2019 Land — $ 259 $ 263 Buildings and improvements 10-40 3,857 3,757 Manufacturing equipment 8-12 2,865 2,655 Laboratory equipment 8-12 1,257 1,236 Fixed equipment 12 2,406 2,338 Capitalized software 3-5 1,216 1,154 Other 5-10 1,091 975 Construction in progress — 915 907 Property, plant and equipment, gross 13,866 13,285 Less accumulated depreciation and amortization (8,977) (8,357) Property, plant and equipment, net $ 4,889 $ 4,928 During the years ended December 31, 2020, 2019 and 2018, we recognized depreciation and amortization expense associated with our property, plant and equipment of $640 million, $635 million and $630 million, respectively. Geographic information Certain geographic information with respect to property, plant and equipment, net (long-lived assets), was as follows (in millions): December 31, 2020 2019 United States $ 2,473 $ 2,433 Puerto Rico 1,331 1,402 ROW 1,085 1,093 Total property, plant and equipment, net $ 4,889 $ 4,928 |
Goodwill and intangible assets
Goodwill and intangible assets | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and other intangible assets | Goodwill and other intangible assets Goodwill The changes in the carrying amounts of goodwill were as follows (in millions): December 31, 2020 2019 Beginning balance $ 14,703 $ 14,699 Addition from acquisitions — 26 Currency translation adjustments (14) (22) Ending balance $ 14,689 $ 14,703 Other intangible assets Other intangible assets consisted of the following (in millions): December 31, 2020 2019 Gross Accumulated Other intangible Gross Accumulated Other intangible Finite-lived intangible assets: Developed-product-technology rights $ 25,591 $ (10,564) $ 15,027 $ 25,575 $ (8,322) $ 17,253 Licensing rights 3,743 (2,791) 952 3,761 (2,398) 1,363 Marketing-related rights 1,367 (1,041) 326 1,382 (965) 417 R&D technology rights 1,317 (1,065) 252 1,273 (947) 326 Total finite-lived intangible assets 32,018 (15,461) 16,557 31,991 (12,632) 19,359 Indefinite-lived intangible assets: IPR&D 30 — 30 54 — 54 Total other intangible assets $ 32,048 $ (15,461) $ 16,587 $ 32,045 $ (12,632) $ 19,413 Developed-product-technology rights consists of rights related to marketed products acquired in acquisitions. Licensing rights consists primarily of contractual rights acquired in acquisitions to receive future milestone, royalty and profit-sharing payments; capitalized payments to third parties for milestones related to regulatory approvals to commercialize products; and up-front payments associated with royalty obligations for marketed products. Marketing-related rights consists primarily of rights related to the sale and distribution of marketed products. R&D technology rights pertains to technologies used in R&D that have alternative future uses. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases On January 1, 2019, we adopted a new accounting standard that amends the guidance for the accounting and reporting of leases. Certain required disclosures have been made on a prospective basis in accordance with the standard’s guidance. See Note 1, Summary of significant accounting policies. We lease certain facilities and equipment related primarily to administrative, R&D and sales and marketing activities. Leases with terms of 12 months or less are expensed on a straight-line basis over the term and are not recorded in the Consolidated Balance Sheets. Most leases include one or more options to renew, with renewal terms that may extend the lease term up to seven years. The exercise of lease renewal options is at our sole discretion. In addition, some of our lease agreements include rental payments adjusted periodically for inflation. Our lease agreements neither contain residual value guarantees nor impose significant restrictions or covenants. We sublease certain real estate to third parties. Our sublease portfolio consists of operating leases from former R&D and administrative space. The following table summarizes information related to our leases, all of which are classified as operating, included in our Consolidated Balance Sheets (in millions): December 31, Consolidated Balance Sheets locations 2020 2019 Assets: Other assets $ 408 $ 469 Liabilities: Accrued liabilities $ 153 $ 140 Other noncurrent liabilities 306 388 Total lease liabilities $ 459 $ 528 The components of net lease costs were as follows (in millions): Years ended December 31, Lease costs 2020 2019 Operating (1) $ 223 $ 204 Sublease income (34) (33) Total net lease costs $ 189 $ 171 ____________ (1) Includes short-term leases and variable lease costs, which were not material for the years ended December 31, 2020 and 2019. Maturities of lease liabilities as of December 31, 2020, were as follows (in millions): Maturity dates Amounts 2021 $ 164 2022 132 2023 105 2024 36 2025 15 Thereafter 36 Total lease payments (1) 488 Less imputed interest (29) Present value of lease liabilities $ 459 ____________ (1) Includes future rental commitments for abandoned leases of $133 million. We expect to receive total future rental income of $107 million related to noncancelable subleases for abandoned facilities. The weighted-average remaining lease terms and weighted-average discount rates were as follows: December 31, 2020 2019 Weighted-average remaining lease term (in years) 3.7 4.1 Weighted-average discount rate 3.1 % 3.3 % Cash and noncash information related to our leases was as follows (in millions): Years ended December 31, 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 177 $ 148 ROU assets obtained in exchange for lease obligations: Operating leases $ 101 $ 163 As of December 31, 2020, we have entered into leases that have not yet commenced, with total undiscounted future lease payments of $339 million. These leases will commence in 2021 with lease terms from 30 months to 15 years. Rental expense on operating leases under the prior lease guidance for the year ended December 31, 2018, was $166 million. |
Other current assets and accrue
Other current assets and accrued liabilities | 12 Months Ended |
Dec. 31, 2020 | |
Payables and Accruals [Abstract] | |
Other current assets and accrued liabilities | Other current assets and accrued liabilities Other current assets consisted of the following (in millions): December 31, 2020 2019 Prepaid expenses $ 1,156 $ 939 Corporate partner receivables 583 485 Tax receivables 216 186 Other 124 278 Total other current assets $ 2,079 $ 1,888 Accrued liabilities consisted of the following (in millions): December 31, 2020 2019 Sales deductions $ 4,801 $ 3,880 Employee compensation and benefits 1,098 981 Dividends payable 1,018 946 Income taxes payable 828 557 Sales returns reserve 474 564 Other 1,922 1,583 Total accrued liabilities $ 10,141 $ 8,511 |
Financing arrangements
Financing arrangements | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Financing arrangements | Financing arrangements Our borrowings consisted of the following (in millions): December 31, 2020 2019 4.50% notes due 2020 (4.50% 2020 Notes) — 300 2.125% notes due 2020 (2.125% 2020 Notes) — 750 Floating Rate Notes due 2020 — 300 2.20% notes due 2020 (2.20% 2020 Notes) — 700 3.45% notes due 2020 (3.45% 2020 Notes) — 900 4.10% notes due 2021 (4.10% 2021 Notes) — 1,000 1.85% notes due 2021 (1.85% 2021 Notes) — 750 3.875% notes due 2021 (3.875% 2021 Notes) — 1,750 1.25% €1,250 million notes due 2022 (1.25% 2022 euro Notes) 1,527 1,402 2.70% notes due 2022 (2.70% 2022 Notes) 500 500 2.65% notes due 2022 (2.65% 2022 Notes) 1,500 1,500 3.625% notes due 2022 (3.625% 2022 Notes) 750 750 0.41% CHF700 million bonds due 2023 (0.41% 2023 Swiss franc Bonds) 791 725 2.25% notes due 2023 (2.25% 2023 Notes) 750 750 3.625% notes due 2024 (3.625% 2024 Notes) 1,400 1,400 1.90% notes due 2025 (1.90% 2025 Notes) 500 — 3.125% notes due 2025 (3.125% 2025 Notes) 1,000 1,000 2.00% €750 million notes due 2026 (2.00% 2026 euro Notes) 916 841 2.60% notes due 2026 (2.60% 2026 Notes) 1,250 1,250 5.50% £475 million notes due 2026 (5.50% 2026 pound sterling Notes) 649 630 2.20% notes due 2027 (2.20% 2027 Notes) 1,750 — 3.20% notes due 2027 (3.20% 2027 Notes) 1,000 1,000 4.00% £700 million notes due 2029 (4.00% 2029 pound sterling Notes) 957 928 2.45% notes due 2030 (2.45% 2030 Notes) 1,250 — 2.30% notes due 2031 (2.30% 2031 Notes) 1,250 — 6.375% notes due 2037 (6.375% 2037 Notes) 478 552 6.90% notes due 2038 (6.90% 2038 Notes) 254 291 6.40% notes due 2039 (6.40% 2039 Notes) 333 466 3.15% notes due 2040 (3.15% 2040 Notes) 2,000 — 5.75% notes due 2040 (5.75% 2040 Notes) 373 412 4.95% notes due 2041 (4.95% 2041 Notes) 600 600 5.15% notes due 2041 (5.15% 2041 Notes) 729 974 5.65% notes due 2042 (5.65% 2042 Notes) 415 487 5.375% notes due 2043 (5.375% 2043 Notes) 185 261 4.40% notes due 2045 (4.40% 2045 Notes) 2,250 2,250 4.563% notes due 2048 (4.563% 2048 Notes) 1,415 1,415 3.375% notes due 2050 (3.375% 2050 Notes) 2,250 — 4.663% notes due 2051 (4.663% 2051 Notes) 3,541 3,541 2.77% notes due 2053 (2.77% 2053 Notes) 940 — Other notes due 2097 100 100 Unamortized bond discounts, premiums and issuance costs, net (1,188) (868) Fair value adjustments 566 296 Other 5 — Total carrying value of debt 32,986 29,903 Less current portion (91) (2,953) Total long-term debt $ 32,895 $ 26,950 There are no material differences between the effective interest rates and the coupon rates of any of our borrowings, except for the 4.563% 2048 Notes, the 4.663% 2051 Notes and the 2.77% 2053 Notes, which have effective interest rates of 6.3%, 5.6% and 5.2%, respectively. Under the terms of all of our outstanding notes, except our Other notes due 2097, in the event of a change-in-control triggering event we may be required to purchase all or a portion of these debt securities at prices equal to 101% of the principal amounts of the notes plus accrued and unpaid interest. In addition, all of our outstanding notes—except our 0.41% 2023 Swiss franc Bonds and Other notes due 2097—may be redeemed at any time at our option—in whole or in part—at the principal amounts of the notes being redeemed plus accrued and unpaid interest and make-whole amounts, which are defined by the terms of the notes. Certain of the redeemable notes do not require the payment of make-whole amounts if redeemed during a specified period of time immediately prior to the maturity of the notes. Such time periods range from one month to six months prior to maturity. Debt issuances During the year ended December 31, 2020, we issued debt securities in the following offerings: • In February 2020, we issued $5.0 billion of debt consisting of $500 million of the 1.90% 2025 Notes, $750 million of the 2.20% 2027 Notes, $1.25 billion of the 2.45% 2030 Notes, $1.25 billion of the 3.15% 2040 Notes and $1.25 billion of the 3.375% 2050 Notes. • In May 2020, we issued $4.0 billion of debt consisting of $1.0 billion of the 2.20% 2027 Notes, $750 million of the 3.15% 2040 Notes and $1.0 billion of the 3.375% 2050 Notes, which represents a further issuance of, and which forms a single series with, each of the corresponding series of notes issued in February 2020, and $1.25 billion of the 2.30% 2031 Notes. We did not issue any debt or debt securities during the years ended December 31, 2019 and 2018. Debt repayments/redemptions We made debt repayments/redemptions during the years ended December 31, 2020, 2019 and 2018 as follows: • In 2020, we repaid/redeemed $6.5 billion of debt, including the repayment at maturity of the $300 million aggregate principal amount of the 4.50% 2020 Notes, the $750 million aggregate principal amount of the 2.125% 2020 Notes, the $300 million Floating Rate Notes due 2020 and the $700 million aggregate principal amount of the 2.20% 2020 Notes. In connection with the redemption of the $900 million aggregate principal amount of the 3.45% 2020 Notes, the $1.0 billion aggregate principal balance of the 4.10% 2021 Notes, the $750 million aggregate principal balance of the 1.85% 2021 Notes and the $1.75 billion aggregate principal balance of the 3.875% 2021 Notes, we paid a total of $96 million in make-whole amounts plus associated accrued and unpaid interest, all of which was recognized in Interest expense, net, in the Consolidated Statements of Income. • In 2019, we repaid $4.5 billion of debt, including the $1.4 billion aggregate principal amount of the 2.20% 2019 Notes, the $1.0 billion aggregate principal amount of the 5.70% 2019 Notes, the €675 million aggregate principal amount ($864 million upon settlement of the related cross-currency swap) of the 2.125% 2019 euro Notes, the $700 million aggregate principal amount of the 1.90% 2019 Notes and the $550 million Floating Rate Notes due 2019. • In 2018, we repaid $1.1 billion of debt, including the $500 million aggregate principal amount of the 6.15% 2018 Notes and the €550 million aggregate principal amount of the 4.375% 2018 Notes revalued at $621 million upon maturity. Interest rate swaps To achieve a desired mix of fixed-rate and floating-rate debt, we entered into interest rate swap contracts that effectively converted fixed-rate interest coupons for certain of our debt issuances to floating LIBOR-based coupons over the lives of the respective notes. These interest rate swap contracts qualified and are designated as fair value hedges. In connection with the redemption of certain of the notes discussed above, associated interest rate swap contracts with an aggregate notional value of $3.65 billion were terminated. In addition, because of historically low interest rates, during the year ended December 31, 2020, we terminated interest rate swaps with an aggregate notional amount of $5.2 billion that hedged the 3.625% 2024 Notes, the 2.60% 2026 Notes, the 4.663% 2051 Notes and portions of the 3.625% 2022 Notes and the 3.125% 2025 Notes, which resulted in the receipt of $576 million of cash and reduced counterparty credit risk. Immediately following the terminations of these contracts, we entered into new interest rate swap agreements at then-current interest rates on the same $5.2 billion principal amount of notes. See Note 18, Derivative instruments. The effective interest rates on notes for which we have entered into interest rate swap contracts and the related notional amounts of these contracts were as follows (dollar amounts in millions): December 31, 2020 December 31, 2019 Notes Notional amounts Effective interest rates Notional amounts Effective interest rates 3.45% 2020 Notes $ — LIBOR + 1.1% $ 900 LIBOR + 1.1% 4.10% 2021 Notes — LIBOR + 1.7% 1,000 LIBOR + 1.7% 3.875% 2021 Notes — LIBOR + 2.0% 1,750 LIBOR + 2.0% 3.625% 2022 Notes 750 LIBOR + 2.7% 750 LIBOR + 1.6% 3.625% 2024 Notes 1,400 LIBOR + 3.2% 1,400 LIBOR + 1.4% 3.125% 2025 Notes 1,000 LIBOR + 1.8% 1,000 LIBOR + 0.9% 2.60% 2026 Notes 1,250 LIBOR + 1.8% 1,250 LIBOR + 0.3% 4.663% 2051 Notes (1) 1,500 LIBOR + 2.6% 1,500 LIBOR + 0.0% Total notional amounts $ 5,900 $ 9,550 ____________ (1) Excludes an additional 1.5% of interest for the difference between the coupon rate paid to noteholders and the fixed rate received under the interest rate swap contracts. Debt exchange In 2020, we completed a private offering to exchange portions of certain outstanding senior notes due 2037 through 2043 (collectively, Old Notes), listed below, for the $940 million principal amount of the newly issued 2.77% 2053 Notes (the Exchange Offer). The following principal amounts of each series of Old Notes were validly tendered and subsequently cancelled in connection with the Exchange Offer (in millions): Principal amount exchanged 6.375% 2037 Notes $ 74 6.90% 2038 Notes 37 6.40% 2039 Notes 133 5.75% 2040 Notes 39 5.15% 2041 Notes 245 5.65% 2042 Notes 72 5.375% 2043 Notes 76 The 2.77% 2053 Notes bear interest at a lower fixed coupon rate while requiring higher principal repayment at a later maturity date as compared to those of the Old Notes that were exchanged. There were no other significant changes to the terms between the Old Notes and the 2.77% 2053 Notes. In connection with the Exchange Offer, $85 million was paid to holders of the Old Notes (the cash consideration). The Exchange Offer was accounted for as a debt modification, and accordingly, deferred financing costs and discounts associated with the Old Notes, the cash consideration and the $264 million discount associated with the 2.77% 2053 Notes are being accreted over the term of these newly issued notes and recorded as Interest expense, net, in the Consolidated Statements of Income. Cross-currency swaps In order to hedge our exposure to foreign currency exchange rate risk associated with certain of our long-term notes denominated in foreign currencies, we entered into cross-currency swap contracts. The terms of these contracts effectively convert the interest payments and principal repayments on our 1.25% 2022 euro Notes, 0.41% 2023 Swiss franc Bonds, 2.00% 2026 euro Notes, 5.50% 2026 pound sterling Notes and 4.00% 2029 pound sterling Notes from euros, pounds sterling and Swiss francs to U.S. dollars. These cross-currency swap contracts have been designated as cash flow hedges. For information regarding the terms of these contracts, see Note 18, Derivative instruments. Shelf registration statement and other facilities As of December 31, 2020, we have a commercial paper program that allows us to issue up to $2.5 billion of unsecured commercial paper to fund our working-capital needs. As of December 31, 2020 and 2019, we had no amounts outstanding under our commercial paper program. In 2019, we amended and restated our $2.5 billion syndicated, unsecured, revolving credit agreement, which is available for general corporate purposes or as a liquidity backstop to our commercial paper program. The commitments under the revolving credit agreement may be increased by up to $750 million with the agreement of the banks. Each bank that is a party to the agreement has an initial commitment term of five years. This term may be extended for up to two additional one-year periods with the agreement of the banks. Annual commitment fees for this agreement are 0.09% of the unused portion of the facility based on our current credit rating. Generally, we would be charged interest for any amounts borrowed under this facility, based on our current credit rating, at (i) LIBOR plus 1% or (ii) the highest of (A) the syndication agent bank base commercial lending rate, (B) the overnight federal funds rate plus 0.50% or (C) one-month LIBOR plus 1%. The agreement contains provisions relating to the determination of successor rates to address the possible phase-out or unavailability of designated reference rates. As of December 31, 2020 and 2019, no amounts were outstanding under this facility. In February 2020, we filed a shelf registration statement with the U.S. Securities and Exchange Commission that allows us to issue unspecified amounts of debt securities; common stock; preferred stock; warrants to purchase debt securities, common stock, preferred stock or depository shares; rights to purchase common stock or preferred stock; securities purchase contracts; securities purchase units; and depository shares. Under this shelf registration statement, all of the securities available for issuance may be offered from time to time with terms to be determined at the time of issuance. This shelf registration statement expires in February 2023. Certain of our financing arrangements contain nonfinancial covenants. In addition, our revolving credit agreement includes a financial covenant, which requires us to maintain a specified minimum interest coverage ratio of (i) the sum of consolidated net income, interest expense, provision for income taxes, depreciation expense, amortization expense, unusual or nonrecurring charges and other noncash items (Consolidated EBITDA) to (ii) Consolidated Interest Expense, each as defined and described in the credit agreement. We were in compliance with all applicable covenants under these arrangements as of December 31, 2020. Contractual maturities of debt obligations The aggregate contractual maturities of all borrowings due subsequent to December 31, 2020, are as follows (in millions): Maturity dates Amounts 2021 $ — 2022 4,277 2023 1,541 2024 1,400 2025 1,500 Thereafter 24,890 Total $ 33,608 Interest costs Interest costs are expensed as incurred except to the extent such interest is related to construction in progress, in which case interest is capitalized. Interest costs capitalized for the years ended December 31, 2020, 2019 and 2018, were not material. Interest paid, including the ongoing impact of interest rate and cross-currency swap contracts, during the years ended December 31, 2020, 2019 and 2018, were $1.2 billion, $1.3 billion and $1.5 billion, respectively. |
Stockholders' equity
Stockholders' equity | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Stockholders' equity | Stockholders’ equity Stock repurchase program Activity under our stock repurchase program, on a trade date basis, was as follows (in millions): Years ended December 31, 2020 2019 2018 Shares Dollars Shares* Dollars Shares* Dollars First quarter 4.3 $ 933 15.9 $ 3,031 56.4 $ 10,787 Second quarter 2.6 591 13.1 2,349 18.2 3,190 Third quarter 3.0 752 6.2 1,170 8.7 1,713 Fourth quarter 5.3 1,221 5.1 1,090 11.1 2,165 Total stock repurchases 15.2 $ 3,497 40.2 $ 7,640 94.5 $ 17,855 * Total shares do not add due to rounding. In December 2019, our Board of Directors increased the amount authorized under our stock repurchase program by an additional $4.0 billion. As of December 31, 2020, $3.0 billion remained available under our stock repurchase program. Dividends Our Board of Directors declared quarterly dividends per share of $1.60, $1.45 and $1.32, which were paid in each of the four quarters of 2020, 2019 and 2018, respectively. Historically, we have declared dividends in December of each year, which were paid in the first quarter of the following fiscal year and in March, July and October, which were paid in the second, third and fourth quarters, respectively, of the same fiscal year. Additionally, on December 16, 2020, the Board of Directors declared a quarterly cash dividend of $1.76 per share of common stock, which will be paid on March 8, 2021, to all stockholders of record as of the close of business on February 15, 2021. Accumulated other comprehensive loss The components of AOCI were as follows (in millions): Foreign Cash flow Available-for-sale Other AOCI Balance as of December 31, 2017 $ (529) $ (6) $ (144) $ — $ (679) Cumulative effect of change in accounting principle, net of tax — — (9) — (9) Foreign currency translation adjustments (141) — — — (141) Unrealized gains (losses) — 61 (556) — (495) Reclassification adjustments to income — 262 365 — 627 Other losses — — — (2) (2) Income taxes — (76) 6 — (70) Balance as of December 31, 2018 (670) 241 (338) (2) (769) Foreign currency translation adjustments (48) — — — (48) Unrealized gains — 127 424 — 551 Reclassification adjustments to income — (211) (56) — (267) Other losses — — — (5) (5) Income taxes — 18 (8) — 10 Balance as of December 31, 2019 (718) 175 22 (7) (528) Foreign currency translation adjustments 9 — — — 9 Unrealized (losses) gains — (61) 6 — (55) Reclassification adjustments to income — (501) (33) — (534) Other losses — — — (7) (7) Income taxes — 124 6 — 130 Balance as of December 31, 2020 $ (709) $ (263) $ 1 $ (14) $ (985) With respect to the table above, income tax expenses or benefits for unrealized gains and losses and the related reclassification adjustments to income for cash flow hedges were a $14 million benefit and a $110 million benefit in 2020, a $28 million expense and a $46 million benefit in 2019 and a $21 million expense and a $55 million expense in 2018, respectively. Income tax expenses or benefits for unrealized gains and losses and the related reclassification adjustments to income for available-for-sale securities were a $1 million expense and a $7 million benefit in 2020, a $22 million expense and a $14 million benefit in 2019 and a $9 million benefit and a $3 million expense in 2018, respectively. Reclassifications out of AOCI and into earnings were as follows (in millions): Years ended December 31, Components of AOCI 2020 2019 2018 Consolidated Statements of Income locations Cash flow hedges: Foreign currency contract gains (losses) $ 178 $ 101 $ (21) Product sales Cross-currency swap contract gains (losses) 323 110 (241) Interest and other income, net 501 211 (262) Income before income taxes (110) (46) 55 Provision for income taxes $ 391 $ 165 $ (207) Net income Available-for-sale securities: Net realized gains (losses) $ 33 $ 56 $ (365) Interest and other income, net (7) (14) 3 Provision for income taxes $ 26 $ 42 $ (362) Net income Other In addition to common stock, our authorized capital includes 5 million shares of preferred stock, $0.0001 par value. As of December 31, 2020 and 2019, no shares of preferred stock were issued or outstanding. |
Fair value measurement
Fair value measurement | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair value measurement | Fair value measurement To estimate the fair value of our financial assets and liabilities, we use valuation approaches within a hierarchy that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing an asset or liability based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the inputs that market participants would use in pricing an asset or liability and are developed based on the best information available in the circumstances. The fair value hierarchy is divided into three levels based on the source of inputs as follows: Level 1 — Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access Level 2 — Valuations for which all significant inputs are observable either directly or indirectly—other than Level 1 inputs Level 3 — Valuations based on inputs that are unobservable and significant to the overall fair value measurement The availability of observable inputs can vary among the various types of financial assets and liabilities. To the extent that the valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. In certain cases, the inputs used for measuring fair value may fall into different levels of the fair value hierarchy. In such cases, for financial statement disclosure purposes, the level in the fair value hierarchy within which the fair value measurement is categorized is based on the lowest level of input used that is significant to the overall fair value measurement. The fair values of each major class of the Company’s financial assets and liabilities measured at fair value on a recurring basis were as follows (in millions): Fair value measurement as of December 31, 2020, using: Quoted prices in Significant other Significant Total Assets: Available-for-sale securities: U.S. Treasury notes $ 130 $ — $ — $ 130 U.S. Treasury bills 4,948 — — 4,948 Corporate debt securities: Financial — — — — Industrial — — — — Other — — — — Residential-mortgage-backed securities — — — — Money market mutual funds 4,765 — — 4,765 Other short-term interest-bearing securities — 2 — 2 Equity securities 477 — — 477 Derivatives: Foreign currency contracts — 28 — 28 Cross-currency swap contracts — 255 — 255 Interest rate swap contracts — 66 — 66 Total assets $ 10,320 $ 351 $ — $ 10,671 Liabilities: Derivatives: Foreign currency contracts $ — $ 237 $ — $ 237 Cross-currency swap contracts — 318 — 318 Interest rate swap contracts — 15 — 15 Contingent consideration obligations — — 33 33 Total liabilities $ — $ 570 $ 33 $ 603 Fair value measurement as of December 31, 2019, using: Quoted prices in Significant other Significant Total Assets: Available-for-sale securities: U.S. Treasury notes $ 360 $ — $ — $ 360 U.S. Treasury bills — — — — Corporate debt securities: Financial — 1,121 — 1,121 Industrial — 834 — 834 Other — 198 — 198 Residential-mortgage-backed securities — 182 — 182 Money market mutual funds 5,250 — — 5,250 Other short-term interest-bearing securities — 289 — 289 Equity securities 303 — — 303 Derivatives: Foreign currency contracts — 224 — 224 Cross-currency swap contracts — 66 — 66 Interest rate swap contracts — 259 — 259 Total assets $ 5,913 $ 3,173 $ — $ 9,086 Liabilities: Derivatives: Foreign currency contracts $ — $ 31 $ — $ 31 Cross-currency swap contracts — 315 — 315 Interest rate swap contracts — — — — Contingent consideration obligations — — 61 61 Total liabilities $ — $ 346 $ 61 $ 407 Interest-bearing and equity securities The fair values of our U.S. Treasury securities, money market mutual funds and equity securities are based on quoted market prices in active markets, with no valuation adjustment. We estimate the fair values of our corporate debt securities by taking into consideration valuations obtained from third-party pricing services. The pricing services use industry-standard valuation models, including both income- and market-based approaches, for which all significant inputs are observable either directly or indirectly to estimate fair value. The inputs include reported trades of and broker-dealer quotes on the same or similar securities; issuer credit spreads; benchmark securities; and other observable inputs. We estimate the fair values of our residential-mortgage-backed securities by taking into consideration valuations obtained from third-party pricing services. The pricing services use industry-standard valuation models, including both income- and market-based approaches, for which all significant inputs are observable either directly or indirectly to estimate fair value. The inputs include reported trades of and broker-dealer quotes on the same or similar securities; issuer credit spreads; benchmark securities; prepayment or default projections based on historical data; and other observable inputs. We value our other short-term interest-bearing securities at amortized cost, which approximates fair value given their near-term maturity dates. Derivatives All of our foreign currency forward and option derivative contracts have maturities of three years or less, and all are with counterparties that have minimum credit ratings of A– or equivalent by Standard & Poor’s Financial Services (S&P), Moody’s Investors Service, Inc. (Moody’s) or Fitch Ratings, Inc. (Fitch). We estimate the fair values of these contracts by taking into consideration valuations obtained from a third-party valuation service that uses an income-based industry-standard valuation model for which all significant inputs are observable either directly or indirectly. These inputs include foreign currency exchange rates, LIBOR, swap rates and obligor credit default swap rates. In addition, inputs for our foreign currency option contracts include implied volatility measures. These inputs, when applicable, are at commonly quoted intervals. See Note 18, Derivative instruments. Our cross-currency swap contracts are with counterparties that have minimum credit ratings of A– or equivalent by S&P, Moody’s or Fitch. We estimate the fair values of these contracts by taking into consideration valuations obtained from a third-party valuation service that uses an income-based industry-standard valuation model for which all significant inputs are observable either directly or indirectly. These inputs include foreign currency exchange rates, LIBOR, swap rates, obligor credit default swap rates and cross-currency basis swap spreads. See Note 18, Derivative instruments. Our interest rate swap contracts are with counterparties that have minimum credit ratings of A– or equivalent by S&P, Moody’s or Fitch. We estimate the fair values of these contracts by using an income-based industry-standard valuation model for which all significant inputs are observable either directly or indirectly. These inputs include LIBOR, swap rates and obligor credit default swap rates. See Note 18, Derivative instruments. During the years ended December 31, 2020 and 2019, there were no transfers of assets or liabilities between fair value measurement levels, and there were no material remeasurements to the fair values of assets and liabilities that are not measured at fair value on a recurring basis. During the year ended December 31, 2018, we discontinued the internal development of a program that resulted in an impairment of an IPR&D asset of $330 million, which was recognized in Other operating expenses in the Consolidated Statements of Income and included in Other items, net, in the Consolidated Statements of Cash Flows. Summary of the fair values of other financial instruments Cash equivalents The fair values of cash equivalents approximate their carrying values due to the short-term nature of such financial instruments. Borrowings We estimated the fair values of our borrowings by using Level 2 inputs. As of December 31, 2020 and 2019, the aggregate fair values of our borrowings were $39.4 billion and $33.7 billion, respectively, and the carrying values were $33.0 billion and $29.9 billion, respectively. Investment in BeiGene We estimated the fair value of our investment in BeiGene by using Level 1 inputs. As of December 31, 2020, the fair value and carrying value were $4.9 billion and $2.9 billion, respectively. |
Derivative instruments
Derivative instruments | 12 Months Ended |
Dec. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative instruments | Derivative instruments The Company is exposed to foreign currency exchange rate and interest rate risks related to its business operations. To reduce our risks related to such exposures, we use or have used certain derivative instruments, including foreign currency forward, foreign currency option, cross-currency swap, forward interest rate and interest rate swap contracts. We do not use derivatives for speculative trading purposes. Cash flow hedges We are exposed to possible changes in the values of certain anticipated foreign currency cash flows resulting from changes in foreign currency exchange rates associated primarily with our euro-denominated international product sales. Increases and decreases in the cash flows associated with our international product sales due to movements in foreign currency exchange rates are partially offset by corresponding increases and decreases in the cash flows from our international operating expenses resulting from these foreign currency exchange rate movements. To further reduce our exposure to foreign currency exchange rate fluctuations with regard to our international product sales, we enter into foreign currency forward and option contracts to hedge a portion of our projected international product sales primarily over a three-year time horizon, with, at any given point in time, a higher percentage of nearer-term projected product sales being hedged than in successive periods. As of December 31, 2020, 2019 and 2018, we had outstanding foreign currency forward contracts with aggregate notional amounts of $5.1 billion, $5.0 billion and $4.5 billion, respectively. As of December 31, 2018 we had outstanding foreign currency option contracts with aggregate notional amounts of $21 million, and no such outstanding contracts as of December 31, 2020 and 2019. We have designated these foreign currency forward and foreign currency option contracts, which are primarily euro based, as cash flow hedges. Accordingly, we report the unrealized gains and losses on these contracts in AOCI in the Consolidated Balance Sheets, and we reclassify them to Product sales in the Consolidated Statements of Income in the same periods during which the hedged transactions affect earnings. To hedge our exposure to foreign currency exchange rate risk associated with certain of our long-term debt denominated in foreign currencies, we enter into cross-currency swap contracts. Under the terms of such contracts, we paid euros, pounds sterling and Swiss francs and received U.S. dollars for the notional amounts at the inception of the contracts; and based on these notional amounts, we exchange interest payments at fixed rates over the lives of the contracts by paying U.S. dollars and receiving euros, pounds sterling and Swiss francs. In addition, we will pay U.S. dollars to and receive euros, pounds sterling and Swiss francs from the counterparties at the maturities of the contracts for these same notional amounts. The terms of these contracts correspond to the related hedged debt, thereby effectively converting the interest payments and principal repayment on the debt from euros, pounds sterling and Swiss francs to U.S. dollars. We have designated these cross-currency swap contracts as cash flow hedges. Accordingly, the unrealized gains and losses on these contracts are reported in AOCI in the Consolidated Balance Sheets and reclassified to Interest and other income, net, in the Consolidated Statements of Income in the same periods during which the hedged debt affects earnings. The notional amounts and interest rates of our cross-currency swaps as of December 31, 2020, were as follows (notional amounts in millions): Foreign currency U.S. dollars Hedged notes Notional amounts Interest rates Notional amounts Interest rates 1.25% 2022 euro Notes € 1,250 1.3 % $ 1,388 3.2 % 0.41% 2023 Swiss franc Bonds CHF 700 0.4 % $ 704 3.4 % 2.00% 2026 euro Notes € 750 2.0 % $ 833 3.9 % 5.50% 2026 pound sterling Notes £ 475 5.5 % $ 747 6.0 % 4.00% 2029 pound sterling Notes £ 700 4.0 % $ 1,111 4.5 % During the year ended December 31, 2019, our 2.125% 2019 euro Notes matured, and the related cross-currency swaps were settled. In connection with the anticipated issuance of long-term fixed-rate debt, we occasionally enter into forward interest rate contracts in order to hedge the variability in cash flows due to changes in the applicable U.S. Treasury rate between the time we enter into these contracts and the time the related debt is issued. Gains and losses on forward interest rate contracts, which are designated as cash flow hedges, are recognized in AOCI in the Consolidated Balance Sheets and are amortized into Interest expense, net, in the Consolidated Statements of Income over the lives of the associated debt issuances. Amounts recognized in connection with forward interest rate swaps during the year ended December 31, 2020, and amounts expected to be recognized during the subsequent 12 months are not material. The unrealized losses and gains recognized in AOCI for our derivative instruments designated as cash flow hedges were as follows (in millions): Years ended December 31, Derivatives in cash flow hedging relationships 2020 2019 2018 Foreign currency contracts $ (251) $ 148 $ 348 Cross-currency swap contracts 190 (21) (287) Forward interest rate contracts — — — Total unrealized (losses) gains $ (61) $ 127 $ 61 Fair value hedges To achieve a desired mix of fixed-rate and floating-rate debt, we entered into interest rate swap contracts that qualified for and were designated as fair value hedges. These interest rate swap contracts effectively convert fixed-rate coupons to floating-rate LIBOR-based coupons over the terms of the related hedge contracts. As of December 31, 2020 and 2019, we had interest rate swap contracts with aggregate notional amounts of $5.9 billion and $9.6 billion, respectively, that hedge certain portions of our long-term debt issuances. Interest rate swaps with an aggregate notional value of $3.7 billion were terminated during the year ended December 31, 2020, in connection with the redemption of certain of our notes. The terminations of these interest rate swaps resulted in a gain of $40 million, recognized in Interest expense, net, in the Consolidated Statements of Income. Additionally, we terminated $5.2 billion aggregate notional amount of interest rate swaps, which resulted in the receipt of $576 million from the counterparties that was included in Net cash provided by operating activities in the Consolidated Statements of Cash Flows for the year ended December 31, 2020. This amount will be recognized as a reduction in Interest expense, net, in the Consolidated Statements of Income over the remaining life of the underlying notes. Immediately following the terminations of these interest rate swap contracts, we entered into new interest rate swap agreements at then-current interest rates on the same $5.2 billion principal amount of notes. See Note 15, Financing arrangements, for information on our interest rate swaps. For interest rate swap contracts that qualify for and are designated as fair value hedges, we recognize in Interest expense, net, in the Consolidated Statements of Income the unrealized gain or loss on the derivative resulting from the change in fair value during the period, as well as the offsetting unrealized loss or gain of the hedged item resulting from the change in fair value during the period attributable to the hedged risk. If a hedging relationship involving an interest rate swap contract is terminated, the gain or loss realized on contract termination is recorded as an adjustment to the carrying value of the debt and amortized into Interest expense, net, over the remaining life of the previously hedged debt. The hedged liabilities and related cumulative-basis adjustments for fair value hedges of those liabilities were recorded in the Consolidated Balance Sheets as follows (in millions): Carrying amounts of hedged liabilities (1) Cumulative amounts of fair value hedging adjustments related to the carrying amounts of the hedged liabilities (2) December 31, December 31, Consolidated Balance Sheets locations 2020 2019 2020 2019 Current portion of long-term debt $ 89 $ 903 $ 89 $ 4 Long-term debt $ 6,258 $ 8,814 $ 477 $ 292 ____________ (1) Current portion of long-term debt includes $89 million of carrying value with discontinued hedging relationships as of December 31, 2020. Long-term debt includes $525 million and $136 million of carrying value with discontinued hedging relationships as of December 31, 2020, and December 31, 2019, respectively. (2) Current portion of long-term debt includes $89 million of hedging adjustments on discontinued hedging relationships as of December 31, 2020. Long-term debt includes $425 million and $36 million of hedging adjustments on discontinued hedging relationships as of December 31, 2020, and December 31, 2019, respectively. Impact of hedging transactions The following tables summarize the amounts recorded in income and expense line items and the effects thereon from fair value and cash flow hedging, including discontinued hedging relationships (in millions): Year ended December 31, 2020 Product sales Interest and other income, net Interest (expense), net Total amounts recorded in income and (expense) line items presented in the Consolidated Statements of Income $ 24,240 $ 256 $ (1,262) The effects of cash flow and fair value hedging: Gains on cash flow hedging relationships reclassified out of AOCI: Foreign currency contracts $ 178 $ — $ — Cross-currency swap contracts $ — $ 323 $ — Gains (losses) on fair value hedging relationships—interest rate swap agreements: Hedged items (1) $ — $ — $ 315 Derivatives designated as hedging instruments $ — $ — $ (204) Year ended December 31, 2019 Product sales Interest and other income, net Interest (expense), net Total amounts recorded in income and (expense) line items presented in the Consolidated Statements of Income $ 22,204 $ 753 $ (1,289) The effects of cash flow and fair value hedging: Gains on cash flow hedging relationships reclassified out of AOCI: Foreign currency contracts $ 101 $ — $ — Cross-currency swap contracts $ — $ 110 $ — (Losses) gains on fair value hedging relationships—interest rate swap agreements: Hedged items (1) $ — $ — $ (349) Derivatives designated as hedging instruments $ — $ — $ 352 Year ended December 31, 2018 Product sales Interest and other income (expense), net Interest (expense), net Total amounts recorded in income and (expense) line items presented in the Consolidated Statements of Income $ 22,533 $ 674 $ (1,392) The effects of cash flow and fair value hedging: (Losses) on cash flow hedging relationships reclassified out of AOCI: Foreign currency contracts $ (21) $ — $ — Cross-currency swap contracts $ — $ (241) $ — Gains (losses) on fair value hedging relationships—interest rate swap agreements: Hedged items (1) $ — $ — $ 65 Derivatives designated as hedging instruments $ — $ — $ (42) __________ (1) Gains on hedged items do not completely offset losses on the related designated hedging instruments due to amortization of the cumulative amounts of fair value hedging adjustments included in the carrying amount of the hedged debt for discontinued hedging relationships and the recognition of gains on terminated hedges where the corresponding hedged item was paid down in the period. No portions of our cash flow hedge contracts were excluded from the assessment of hedge effectiveness. As of December 31, 2020, we expected to reclassify $136 million of net losses on our foreign currency and cross-currency swap contracts out of AOCI and into earnings during the next 12 months. Derivatives not designated as hedges To reduce our exposure to foreign currency fluctuations in certain assets and liabilities denominated in foreign currencies, we enter into foreign currency forward contracts that are not designated as hedging transactions. Most of these exposures are hedged on a month-to-month basis. As of December 31, 2020, 2019 and 2018, the total notional amounts of these foreign currency forward contracts were $1.0 billion, $1.2 billion and $737 million, respectively. Gains and losses recognized in earnings for our derivative instruments not designated as hedging instruments were not material for the years ended December 31, 2020, 2019 and 2018. The fair values of derivatives included in the Consolidated Balance Sheets were as follows (in millions): Derivative assets Derivative liabilities December 31, 2020 Consolidated Balance Sheets locations Fair values Consolidated Balance Sheets locations Fair values Derivatives designated as hedging instruments: Foreign currency contracts Other current assets/ Other assets $ 28 Accrued liabilities/ Other noncurrent liabilities $ 237 Cross-currency swap contracts Other current assets/ Other assets 255 Accrued liabilities/ Other noncurrent liabilities 318 Interest rate swap contracts Other current assets/ Other assets 66 Accrued liabilities/ Other noncurrent liabilities 15 Total derivatives designated as hedging instruments 349 570 Derivatives not designated as hedging instruments: Foreign currency contracts Other current assets — Accrued liabilities — Total derivatives not designated as hedging instruments — — Total derivatives $ 349 $ 570 Derivative assets Derivative liabilities December 31, 2019 Consolidated Balance Sheets locations Fair values Consolidated Balance Sheets locations Fair values Derivatives designated as hedging instruments: Foreign currency contracts Other current assets/ Other assets $ 223 Accrued liabilities/ Other noncurrent liabilities $ 31 Cross-currency swap contracts Other current assets/ Other assets 66 Accrued liabilities/ Other noncurrent liabilities 315 Interest rate swap contracts Other current assets/ Other assets 259 Accrued liabilities/ Other noncurrent liabilities — Total derivatives designated as hedging instruments 548 346 Derivatives not designated as hedging instruments: Foreign currency contracts Other current assets 1 Accrued liabilities — Total derivatives not designated as hedging instruments 1 — Total derivatives $ 549 $ 346 |
Contingencies and commitments
Contingencies and commitments | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies and commitments | Contingencies and commitments Contingencies In the ordinary course of business, we are involved in various legal proceedings, government investigations and other matters that are complex in nature and have outcomes that are difficult to predict. See Part I, Item 1A. Risk Factors— Our business may be affected by litigation and government investigations. We describe our legal proceedings and other matters that are significant or that we believe could become significant in this footnote. We record accruals for loss contingencies to the extent that we conclude it is probable that a liability has been incurred and the amount of the related loss can be reasonably estimated. We evaluate, on a quarterly basis, developments in legal proceedings and other matters that could cause an increase or decrease in the amount of the liability that has been accrued previously. Our legal proceedings involve various aspects of our business and a variety of claims, some of which present novel factual allegations and/or unique legal theories. In each of the matters described in this filing, in which we could incur a liability, our opponents seek an award of a not-yet-quantified amount of damages or an amount that is not material. In addition, a number of the matters pending against us are at very early stages of the legal process, which in complex proceedings of the sort we face often extend for several years. As a result, none of the matters described in this filing, in which we could incur a liability, have progressed sufficiently through discovery and/or the development of important factual information and legal issues to enable us to estimate a range of possible loss, if any, or such amounts are not material. While it is not possible to accurately predict or determine the eventual outcomes of these matters, an adverse determination in one or more of these matters currently pending could have a material adverse effect on our consolidated results of operations, financial position or cash flows. Certain recent developments concerning our legal proceedings and other matters are discussed below: Abbreviated New Drug Application (ANDA) Patent Litigation KYPROLIS ® ANDA Patent Litigation Onyx Therapeutics, Inc. v. Cipla Limited, et al . Between October 2016 and April 2018, Onyx Therapeutics, Inc. (Onyx Therapeutics, a wholly-owned subsidiary of Amgen), filed separate lawsuits in the U.S. District Court for the District of Delaware (the Delaware District Court) against: (1) Cipla Limited and Cipla USA, Inc. (collectively, Cipla); (2) Sagent Pharmaceuticals, Inc. (Sagent); (3) Breckenridge Pharmaceutical, Inc. (Breckenridge); and (4) Fresenius Kabi, USA LLC, Fresenius Kabi USA, Inc., Fresenius Kabi Pharmaceuticals Holding, Inc. and Fresenius Kabi Oncology Limited; (5) Teva Pharmaceuticals USA, Inc. and Teva Pharmaceutical Industries Ltd.; (6) MSN Laboratories Private Limited and MSN Pharmaceuticals, Inc. (collectively, MSN); (7) Dr. Reddy’s Laboratories, Ltd. and Dr. Reddy’s Laboratories, Inc. (collectively, DRL); (8) Qilu Pharma, Inc. and Qilu Pharmaceutical Co. Ltd. (collectively, Qilu); (9) Apotex Inc. and Apotex Corp. (Apotex); (10) InnoPharma, Inc. (InnoPharma); and (11) Aurobindo Pharma USA, Inc., each for infringement of one or more of our following patents, which are listed in the Approved Drug Products with Therapeutic Equivalence Evaluations (the Orange Book) for KYPROLIS ® : U.S. Patent Nos. 7,232,818 (the ’818 Patent), 7,417,042 (the ’042 Patent), 7,491,704 (the ’704 Patent), 7,737,112 (the ’112 Patent), 8,129,346 (the ’346 Patent), 8,207,125 (the ’125 Patent), 8,207,126 (the ’126 Patent), 8,207,127 (the ’127 Patent) and 8,207,297 (the ’297 Patent). Each of these lawsuits was based on each defendant’s submission of an ANDA seeking U.S. Food and Drug Administration (FDA) approval to market a generic version of KYPROLIS ® . In each lawsuit, Onyx Therapeutics sought an order of the Delaware District Court making any FDA approval of the respective defendant’s ANDA effective no earlier than the expiration of the applicable patents. The Delaware District Court consolidated these lawsuits for purposes of discovery into a single case, Onyx Therapeutics, Inc. v. Cipla Limited, et al . In January 2017, by stipulation with Onyx Therapeutics, Fresenius Kabi Pharmaceuticals Holding, Inc. and Fresenius Kabi Oncology Limited were dismissed from the lawsuit, leaving Fresenius Kabi, USA LLC and Fresenius Kabi USA, Inc. (collectively, Fresenius) as the remaining Fresenius defendants. In September 2017 and February 2018, respectively, by joint stipulation with Onyx Therapeutics, Teva Pharmaceutical Industries Ltd. and Teva Pharmaceuticals USA, Inc. were each dismissed from the lawsuit, and in February 2018, Qilu was dismissed from the lawsuit by joint stipulation between Onyx Therapeutics and Qilu. Between April and July of 2018, the Delaware District Court entered orders on stipulations between Onyx Therapeutics and each of Apotex, DRL, Sagent, Fresenius, Breckenridge, Aurobindo Pharma USA, Inc., Cipla and InnoPharma, respectively, that each defendant infringes the ’042, ’112, ’125, ’126 and ’127 Patents. Onyx Therapeutics provided those defendants, either through a stipulated order or other agreement, a covenant that it would not assert patent infringement of the ’818,’704,’346 and ’297 Patents against certain of the respective defendants’ ANDA applications and products. In June 2018, the Delaware District Court entered an order on a stipulation between Onyx Therapeutics and MSN that MSN infringes the ’112 Patent. In December 2018, Apotex, DRL, Fresenius, InnoPharma, Sagent, Breckenridge, Aurobindo Pharma USA, Inc. and Cipla amended their responses to the complaints to add the defense of unclean hands and to seek declarations of unenforceability of the asserted patents based on allegations of inequitable conduct. In January 2019, MSN amended its responses to the complaints to add the defense of unclean hands. On January 11, 2019, Onyx Therapeutics filed a separate lawsuit in the Delaware District Court against Breckenridge for infringement of the ’042, ’112 and ’125 Patents in connection with its ANDA that seeks approval to market generic versions of KYPROLIS ® . On March 4, 2019, the Delaware District Court entered an order on a stipulation between Onyx Therapeutics and Breckenridge, providing that Breckenridge infringes the asserted claims of the ’042, ’112 and ’125 Patents, and consolidated this lawsuit against Breckenridge into the existing consolidated case, Onyx Therapeutics, Inc. v. Cipla Limited, et al. , for all purposes. On May 6, 2019, the Delaware District Court commenced trial in the Onyx Therapeutics, Inc. v. Cipla Limited, et al . consolidated case. During trial, the Delaware District Court signed consent judgments filed by Onyx Therapeutics and each of Aurobindo Pharma USA, Inc., InnoPharma, Sagent, Apotex, Fresenius, DRL and Breckenridge, in which the parties stipulated to entry of: (1) judgment dismissing with prejudice all of the parties’ claims, counterclaims, affirmative defenses and demands; and (2) an injunction prohibiting infringement of the ’042, ’112 and ’125 Patents by the manufacture, use, sale, offer to sell or importation into the United States of the applicable defendant’s carfilzomib product unless specifically authorized pursuant to the applicable confidential settlement agreement. During trial, the Delaware District Court also entered a consent judgment between Onyx Therapeutics and MSN, in which the parties stipulated to entry of: (1) judgment dismissing with prejudice all of the parties’ claims, counterclaims, affirmative defenses and demands; and (2) an injunction prohibiting infringement of the ’112 Patent by the manufacture, use, sale, offer to sell or importation into the United States of MSN’s carfilzomib product unless specifically authorized pursuant to the confidential settlement agreement. On May 16, 2019, trial concluded between Onyx Therapeutics and the lone remaining defendant, Cipla. On May 8, 2020, consistent with its May 4, 2020 decision and order, the Delaware District Court entered final judgment in favor of Onyx Therapeutics and against Cipla on infringement, validity and enforceability of claims 23 and 24 of the ’042 Patent, claim 1 of the ’125 Patent and claim 31 of the ’112 Patent. The Delaware District Court entered judgment in favor of Cipla and against Onyx Therapeutics on Cipla’s counterclaim for invalidity of claim 32 of the ’112 Patent and ordered that the effective date of any final approval by the FDA of Cipla’s ANDA must be after expiration of the three asserted patents (the ’042, ’125 and ’112 Patents) and any regulatory exclusivity to which Onyx Therapeutics may become entitled. The final judgment includes an injunction prohibiting Cipla from making, using, offering to sell, selling or importing into the United States Cipla’s carfilzomib product during the term of the three asserted patents. On May 29, 2020, Cipla filed a notice of appeal to the U.S. Court of Appeals for the Federal Circuit (the Federal Circuit Court). The Federal Circuit Court has set the hearing date on Cipla’s appeal for March 5, 2021. Otezla ® ANDA Patent Litigation Amgen Inc. v. Sandoz Inc., et al. Beginning in June 2018, Celgene filed 19 separate lawsuits in the U.S. District Court for the District of New Jersey (the New Jersey District Court) against Alkem Laboratories Ltd. (Alkem); Amneal Pharmaceuticals LLC; Annora Pharma Private Ltd. and Hetero USA Inc. (collectively, Hetero); Aurobindo Pharma Ltd. and Aurobindo Pharma USA Inc. (collectively, Aurobindo); Cipla Limited (Cipla Ltd); DRL; Emcure Pharmaceuticals Ltd. and Heritage Pharmaceuticals Inc. (collectively, Emcure); Glenmark Pharmaceuticals Ltd. (Glenmark); Macleods Pharmaceuticals Ltd. (Macleods); Mankind Pharma Ltd. (Mankind); MSN Laboratories Private Limited; Pharmascience Inc. (Pharmascience); Prinston Pharmaceutical Inc. (Prinston); Sandoz Inc.; Shilpa Medicare Ltd. (Shilpa); Teva Pharmaceuticals USA, Inc. and Actavis LLC (collectively, Actavis); Torrent Pharmaceuticals Ltd. (Torrent); Unichem Laboratories, Ltd. (Unichem); and Zydus Pharmaceuticals (USA) Inc., each for infringement of one or more of the following patents: U.S. Patent Nos. 6,962,940 (the ’940 Patent), 7,208,516 (the ’516 Patent), 7,427,638 (the ’638 Patent), 7,659,302 (the ’302 Patent), 7,893,101 (the ’101 Patent), 8,455,536 (the ’536 Patent), 8,802,717 (the ’717 Patent), 9,018,243 (the ’243 Patent) and 9,872,854 (the ’854 Patent), which are listed in the Orange Book for Otezla ® . Each of the defendants is seeking to market a generic version of Otezla ® before expiration of the asserted patents. The New Jersey District Court consolidated these 19 lawsuits for discovery and case management purposes into a single case, Celgene Corp. v. Sandoz Inc., et al. Each lawsuit seeks an order of the New Jersey District Court making any FDA approval of the respective defendant’s ANDA effective no earlier than the expiration of the applicable patents. In August 2018, Celgene filed amended complaints against Alkem, Amneal Pharmaceuticals LLC, Aurobindo, Cipla Ltd, DRL, Glenmark, Pharmascience, Sandoz Inc., Actavis, Unichem and Zydus Pharmaceuticals (USA) Inc. additionally asserting U.S. Patent No. 9,724,330 (the ’330 Patent), which is listed in the Orange Book for Otezla ® . Between October 15 and November 27, 2018, Celgene filed amended complaints against Alkem, Amneal Pharmaceuticals LLC, Hetero, Aurobindo, Cipla Ltd, DRL, Emcure, Glenmark, Macleods, Mankind, MSN Laboratories Private Limited, Pharmascience, Prinston, Sandoz Inc., Actavis, Torrent, Unichem and Zydus Pharmaceuticals (USA) Inc. additionally asserting U.S. Patent No. 10,092,541 (the ’541 Patent), which is listed in the Orange Book for Otezla ® . Between March 1 and April 4, 2019, Celgene filed amended complaints against Hetero, MSN Laboratories Private Limited and Emcure for infringement of one or more of the above-listed patents. On October 1, 2019, Celgene filed an amended complaint against Mankind for infringement of the ’940, ’302, ’536, ’243 and ’330 Patents. On October 8, 2019, Celgene filed a separate lawsuit against Zydus Pharmaceuticals (USA) Inc. in the New Jersey District Court for infringement of U.S. Patent Nos. 8,093,283 (the ’283 Patent) and 8,629,173 (the ’173 Patent), which are not listed in the Orange Book for Otezla ® . On December 19, 2019, the New Jersey District Court consolidated this lawsuit for discovery and case management purposes into the existing consolidated case, Celgene Corp. v. Sandoz Inc., et al . Each defendant has filed an answer to the above-listed complaints and amended complaints disputing infringement and/or validity of the patents asserted against it. Along with their answers, each of Alkem, Hetero, Cipla Ltd, DRL, Emcure, Glenmark, Macleods, Mankind, Pharmascience, Sandoz Inc., Shilpa, Actavis, Torrent, Unichem and Zydus Pharmaceuticals (USA) Inc. filed declaratory judgment counterclaims asserting that some or all of the patents are not infringed and/or are invalid. In August 2019, based on a joint request by Celgene and Glenmark, the New Jersey District Court entered a consent judgment and injunction prohibiting the making, having made, using, selling, offering to sell, importing, or distributing of Glenmark’s apremilast product during the term of the ’940, ’638, ’302, ’101, ’536, ’243, ’330 and ’541 Patents, unless authorized pursuant to a confidential settlement agreement. Following Amgen’s acquisition of the patents-in-suit and the new drug application for Otezla ® , on February 14, 2020, the New Jersey District Court issued an order substituting Amgen for Celgene as plaintiff in the consolidated action and all related actions, terminating Celgene as plaintiff in the consolidated action and all related actions, and amending the case caption in the consolidated action and all related actions to reflect Amgen as the sole plaintiff. On March 25, 2020, based on a joint request by Amgen and Unichem, the New Jersey District Court entered a consent judgment and injunction prohibiting the making, using, selling, offering to sell, or importing of Unichem’s apremilast product during the term of the ’940, ’638, ’302, ’101, ’536, ’243, ’330 and ’541 Patents, unless authorized pursuant to a confidential settlement agreement. On April 3, 2020, based on a joint request by Amgen and Hetero, the New Jersey District Court entered a consent judgment and injunction prohibiting the making, using, selling, offering to sell, or importing of Hetero’s apremilast product during the term of the ’940, ’516, ’638, ’302, ’101, ’536, ’717, ’243, ’330, ’854 and ’541 Patents, unless authorized pursuant to a confidential settlement agreement. On May 28, 2020, based on a joint request by Amgen and Emcure, the New Jersey District Court entered a consent judgment and injunction prohibiting the making, using, selling, offering to sell, or importing of Emcure’s apremilast product during the term of the ’638, ’101, ’854 and ’541 Patents unless authorized pursuant to a confidential settlement agreement. On July 7, 2020, the New Jersey District Court ordered a stipulated dismissal without prejudice of all claims, counterclaims, and affirmative defenses between Amgen and Sandoz Inc. with respect to the ’717, ’516 and ’854 Patents, leaving the ’940, ’302, ’536, ’243, ’330, ’638, ’101 and ’541 Patents asserted by Amgen against Sandoz Inc. in the litigation. On August 6, 2020, based on a joint request by Amgen and Mankind, the New Jersey District Court entered a consent judgment and injunction prohibiting the making, using, selling, offering to sell, or importing of Mankind’s apremilast product during the term of the ’940, ’302, ’536, ’243, ’330, ’638, ’101 and ’541 Patents, unless authorized pursuant to a confidential settlement agreement. On August 14, 2020, based on a joint request by Amgen and Macleods, the New Jersey District Court entered a consent judgment and injunction prohibiting the making, using, selling, offering to sell, or importing of Macleods’ apremilast product during the term of the ’638 and ’541 Patents, unless authorized pursuant to a confidential settlement agreement. On October 7, 2020, based on a joint request by Amgen and Amneal Pharmaceuticals LLC, the New Jersey District Court entered a consent judgment and injunction prohibiting the making, using, selling, offering to sell, or importing of Amneal Pharmaceuticals LLC’s apremilast product during the term of the ’101, ’940, ’638, ’302, ’536, ’243, ’330 and ’541 Patents, unless authorized pursuant to a confidential settlement agreement. On December 30, 2020, based on a joint request by Amgen and Shilpa, the New Jersey District Court entered a consent judgment and injunction prohibiting the making, using, selling, offering to sell, or importing of Shilpa’s apremilast product during the term of the ’638, ’101 and ’854 Patents, unless authorized pursuant to a confidential settlement agreement. On January 26, 2021, based on a joint request by Amgen and Actavis, the New Jersey District Court entered a consent judgment and injunction prohibiting the making, using, selling, offering to sell, or importing of Actavis’ apremilast product during the term of the ’940, ’516, ’638, ’302, ’536, ’717, ’330, ’854 and ’541 Patents, unless authorized pursuant to a confidential settlement agreement. Trial in the consolidated action against the remaining defendants is scheduled to commence on June 14, 2021. Sensipar ® (cinacalcet) ANDA Patent Litigation Amgen Inc. v. Amneal Pharmaceuticals LLC, et al. (formerly, Amgen Inc. v. Aurobindo Pharma Ltd. et al.) Beginning in September 2016, Amgen filed 14 separate lawsuits in the Delaware District Court for infringement of our U.S. Patent No. 9,375,405 (the ’405 Patent) against a number of manufacturers of purported generic versions of our Sensipar ® product. In February 2017, the Delaware District Court consolidated these 14 lawsuits into a single case, Amgen Inc. v. Aurobindo Pharma Ltd. et al. In June 2017, Amgen filed an additional lawsuit in the Delaware District Court for infringement of the ’405 Patent which was consolidated into Amgen Inc. v. Aurobindo Pharma Ltd. et al . in August 2017. The ’405 Patent is entitled “Rapid Dissolution Formulation of a Calcium Receptor-Active Compound” and expires in 2026. All defendants responding to the complaint denied infringement and sought judgment that the ’405 Patent is invalid and/or not infringed. Between September and November of 2017, Amgen filed, and the Delaware District Court signed, stipulated dismissals of the lawsuit against Micro Labs Ltd. and Micro Labs USA, Inc., and the lawsuit against Apotex, as well as consent judgments filed by Amgen and each of (1) Sun Pharma Global FZE, Sun Pharmaceutical Industries, Ltd. and Sun Pharmaceutical Industries, Inc. (collectively, Sun); (2) Ajanta Pharma Limited and Ajanta Pharma USA, Inc.; (3) Hetero USA Inc., Hetero Labs Ltd. and Hetero Labs Ltd. Unit V; and (4) Breckenridge. Each consent judgment stipulated to an entry of judgment of infringement and validity of the ’405 Patent and an injunction prohibiting the manufacture, use, sale, offer to sell, importation of or distribution into the United States of the respective defendant’s cinacalcet product during the term of the ’405 Patent, unless specifically authorized pursuant to the confidential settlement agreement. In March 2018, the Delaware District Court commenced trial on the infringement claims and defenses in the Amgen Inc. v. Aurobindo Pharma Ltd. et al. consolidated lawsuit against the defendants that remained in the lawsuit, collectively consisting of (1) Watson Laboratories, Inc. and Actavis Pharma, Inc. (collectively, Watson); (2) Amneal Pharmaceuticals LLC and Amneal Pharmaceuticals of New York, LLC (collectively, Amneal); (3) Zydus Pharmaceuticals (USA) Inc. and Cadila Healthcare Ltd. (collectively, Zydus); and (4) Piramal Healthcare UK Limited (Piramal). Just prior to trial, the Delaware District Court signed consent judgments filed by Amgen and each of Cipla, and Strides Pharma Global Pte Limited and Strides Pharma, Inc. (collectively, Strides), and a consent judgment filed by Amgen and Aurobindo. In each consent judgment, the parties stipulated to an entry of judgment of infringement and validity of the ’405 Patent and an injunction prohibiting the manufacture, use, sale, offer to sell, importation of or distribution into the United States of the applicable defendant’s cinacalcet product during the term of the ’405 Patent, unless specifically authorized pursuant to the applicable confidential settlement agreement. Just prior to trial, the Delaware District Court also entered orders dismissing each of DRL and Mylan Pharmaceuticals Inc. and Mylan Inc. (collectively, Mylan), on stipulations between Amgen and such parties, respectively, subject to the terms of confidential settlement agreements. In July 2018, the Delaware District Court issued a trial order finding on the infringement claims and defenses in the Amgen Inc. v. Aurobindo Pharma Ltd. et al. consolidated lawsuit that Zydus infringes the ’405 Patent and that Amneal, Piramal and Watson do not infringe the ’405 Patent. In August 2018, the Delaware District Court issued an order dismissing, without prejudice, the invalidity counterclaims of Amneal, Piramal and Watson and entered judgment of noninfringement of the ’405 Patent in favor of Amneal, Piramal and Watson. In September 2018, Amgen filed a notice of appeal to the Federal Circuit Court. In October 2018, the Delaware District Court dismissed, without prejudice, the invalidity counterclaims of Zydus and entered judgment of infringement of the ’405 Patent by Zydus in favor of Amgen, including an order that the effective date of the FDA approval of Zydus’ generic version of Sensipar ® shall be no earlier than the expiry date of our ’405 Patent. Also in October 2018, Zydus filed a notice of appeal to the Federal Circuit Court, and the Federal Circuit Court consolidated the appeals of Zydus and Amgen. In December 2018, the FDA approved Watson’s generic version of Sensipar ® and Watson’s parent company, Teva Pharmaceutical Industries Ltd. (Teva), began selling its product at-risk notwithstanding that the appeals were pending at the Federal Circuit Court. On January 2, 2019, Amgen, Watson and Teva entered into a settlement agreement in which Teva agreed to stop selling its generic product until the mid-year 2021 (or earlier under certain circumstances) and to pay Amgen an undisclosed amount. On January 9, 2019, Watson and Amgen filed a motion asking the Delaware District Court to vacate its final judgment of noninfringement as to Watson and to enter a proposed consent judgment of infringement and validity of the ’405 Patent and an injunction prohibiting the making, having made, using, selling, offering to sell, or distributing Watson’s cinacalcet product in the United States or importing Watson’s cinacalcet product into the United States, consistent with the confidential settlement agreement. On January 11, 2019, the Federal Circuit Court stayed the pending appeal by Amgen of the judgment of noninfringement as to Watson in order for the Delaware District Court to rule on the motion of Watson and Amgen. On March 26, 2019, the Delaware District Court denied the joint motion for indicative ruling of Watson and Amgen. On April 10, 2019, Amgen filed an appeal to the Federal Circuit Court and the Federal Circuit Court lifted the stay of Amgen’s appeal of the judgment of noninfringement as to Watson and consolidated it with Amgen’s appeal of the Delaware District Court’s denial of the joint motion for indicative ruling. On September 13, 2019, the Federal Circuit Court denied Amgen’s motion and lifted the stay of the briefing schedule which had been stayed pending disposition of Amgen’s motion to vacate. On July 9, 2020, the Federal Circuit Court granted a motion filed by Amgen and Watson to dismiss Amgen’s appeals of the Delaware District Court’s judgment of noninfringement as to Watson and denial of the joint motion for indicative ruling. On March 19, 2019, Amgen filed an emergency motion for an injunction pending appeal, seeking an order from the Delaware District Court enjoining defendant Piramal from making, using, selling, offering for sale or importing its generic cinacalcet product. Amgen’s motion follows an announcement that Slate Run Pharmaceuticals LLC (Slate Run), in partnership with Piramal, had begun selling Piramal’s generic cinacalcet product at-risk notwithstanding the appeals pending at the Federal Circuit Court. On April 15, 2019, the Delaware District Court signed an order enjoining Piramal and Slate Run from selling their generic cinacalcet product until certain events occur related to a decision by the Federal Circuit Court on the parties’ appeal. The order has no effect on the product that Piramal and Slate Run had already sold to third parties. On January 7, 2020, the Federal Circuit Court issued an opinion affirming the judgment of noninfringement with respect to Piramal, affirming the judgment of infringement with respect to Zydus and vacating and remanding to the Delaware District Court for further consideration the judgment of noninfringement with respect to Amneal. On April 22, 2020, the Federal Circuit Court issued a mandate returning the case to the Delaware District Court. On September 8, 2020, the Delaware District Court entered judgment of validity and infringement of the ’405 Patent in the lawsuit filed against Amneal and, except to the extent specifically authorized in a confidential settlement agreement, enjoined Amneal from infringing the ’405 Patent by making, using, selling, offering to sell or importing Amneal’s cinacalcet product during the term of the patent. A hearing before the Delaware District Court on the request of Piramal to recover damages for being enjoined during the pendency of Amgen’s appeal has been rescheduled for March 24, 2021. On October 14, 2020, the Delaware District Court issued an order permitting Slate Run, Piramal’s business partner, to intervene in the pending action. ENBREL Patent Litigation Immunex Corporation, et al. v. Sandoz Inc., et al. In February 2016, two affiliates of Amgen Inc., Immunex Corporation and Amgen Manufacturing, Limited (collectively, Amgen), along with Hoffmann-La Roche Inc. (Roche), filed a lawsuit in the New Jersey District Court against Sandoz Inc., Sandoz International GmbH and Sandoz GmbH (collectively, Sandoz). This lawsuit stems from Sandoz’s submission of an application for FDA licensure of an etanercept product as biosimilar to Amgen’s ENBREL. Amgen and Roche have asserted infringement of five patents: U.S. Patent Nos. 8,063,182 (the ’182 Patent), 8,163,522 (the ’522 Patent), 7,915,225 (the ’225 Patent), 8,119,605 (the ’605 Patent) and 8,722,631 (the ’631 Patent). By their complaint, Amgen and Roche seek an injunction to prohibit Sandoz from commercializing its biosimilar etanercept product in the United States prior to the expiry of such patents. All Sandoz defendants responded by denying infringement and/or asserting that the patents at issue are invalid. In August 2016, and subject to the terms of a confidential stipulation, the New Jersey District Court entered a preliminary injunction prohibiting Sandoz from making, using, importing, selling or offering for sale Sandoz’s etanercept product. Sandoz’s Erelzi TM , a biosimilar to ENBREL, was approved by the FDA in August 2016. In September 2018, the New Jersey District Court entered an order that the making, using, offering to sell or selling in the United States or the importation into the United States by Sandoz of Sandoz’s biosimilar etanercept product infringes the ’182 and ’522 Patents and held a bench trial, focusing on Sandoz’s challenges to the validity of these patents. On August 9, 2019, the New Jersey District Court issued its decision upholding the validity of the ’182 and ’522 Patents. On October 8, 2019, by stipulation of Amgen and Sandoz, the New Jersey District Court entered final judgment and a permanent injunction prohibiting Sandoz from making, using, importing, selling or offering for sale Sandoz’s etanercept product, and, on the same day, Sandoz appealed the final judgment to the Federal Circuit Court. Following a motion by Sandoz, the Federal Circuit Court ordered an expedited briefing schedule for the appeal. On March 4, 2020, the Federal Circuit Court heard oral argument on the appeal. On July 1, 2020, the Federal Circuit Court affirmed the judgment of the New Jersey District Court upholding the validity of the ’182 and ’522 Patents. On September 29, 2020, the Federal Circuit Court denied the petition for rehearing of Sandoz filed on July 31, 2020. On January 29, 2021, Sandoz filed a petition for certiorari with the U.S. Supreme Court seeking review of the Federal Circuit Court’s affirmance of the validity of the ’182 and ’522 Patents. Immunex Corporation, et al. v. Samsung Bioepis Co., Ltd. On April 30, 2019, two affiliates of Amgen Inc., Immunex Corporation and Amgen Manufacturing, Limited (collectively, Amgen), along with Roche, filed a lawsuit in the New Jersey District Court against Samsung Bioepis Co., Ltd. (Bioepis). This lawsuit stems from Bioepis’ submission of an application for FDA licensure of an etanercept product as biosimilar to Amgen’s ENBREL. Amgen and Roche have asserted infringement of five patents: the ’182, ’522, ’225, ’605 and ’631 Patents. By their complaint, Amgen and Roche seek an injunction to prohibit Bioepis from commercializing its biosimilar etanercept product in the United States prior to the expiry of such patents. On August 5, 2019, Bioepis responded to the complaint, denying infringement and seeking judgment that the patents-in-suit are invalid, unenforceable and/or not infringed. On January 9, 2020 and subject to the terms of a confidential stipulation and court order of January 6, 2020, the New Jersey District Court entered a consent injunction that prohibits Bioepis from making, using, offering to sell, selling or importing into the United States Bioepis’ etanercept product. Amgen and Bioepis entered into an agreement with respect to an injunction regarding etanercept as set out in the New Jersey District Court’s order of January 6, 2020. On January 15, 2020, the New Jersey District Court entered an order administratively staying the case pursuant to a joint request of Amgen and Bioepis. Repatha ® Patent Litigation Amgen Inc., et al. v. Sanofi, et al. In October 2014, Amgen initiated a series of lawsuits that were consolidated by the Delaware District Court in December 2014 into a single case against Sanofi, Sanofi-Aventis U.S. LLC and Aventisub LLC, formerly doing business as Aventis Pharmaceuticals Inc. (collectively, Sanofi) and Regeneron Pharmaceuticals, Inc. (Regeneron), addressing seven of our patents: U.S. Patent Nos. 8,563,698; 8,829,165 (the ’165 Patent); 8,859,741 (the ’741 Patent); 8,871,913; 8,871,914; 8,883,983; and 8,889,834. These patents describe and claim monoclonal antibodies to proprotein convertase subtilisin/kexin type 9 (PCSK9). By its complaints, Amgen seeks an injunction to prevent the infringing manufacture, use and sale of Sanofi and Regeneron’s alirocumab, a monoclonal antibody targeting PCSK9. In January 2016, the Delaware District Court granted Amgen’s motion to amend the complaint to add its affiliates, Amgen Manufacturing, Limited and Amgen USA Inc., as plaintiffs and to add the allegation that Sanofi and Regeneron’s infringement of Amgen’s patents is willful. In February 2016, the Delaware District Court entered a stipulated order finding alirocumab and the drug product containing it, PRALUENT ® infringe certain of Amgen’s patents, including claims 2, 7, 9, 15, 19 and 29 of the ’165 Patent and claim 7 of the ’741 Patent. In March 2016, the Delaware District Court entered judgment in favor of Amgen following a five-day jury trial and a unanimous jury verdict that these patent claims are all valid. In January 2017, the Delaware District Court denied Sanofi and Regeneron’s post-trial motions seeking a new trial and for judgment as a matter of law, and granted Amgen’s motion for a permanent injunction prohibiting the infringing manufacture, use, sale, offer for sale or import of alirocumab in the United States. Sanofi and Regeneron filed an appeal of the judgment and the permanent injunction to the Federal Circuit Court. In February 2017, following a motion by Sanofi and Regeneron, the Federal Circuit Court entered a stay of the permanent injunction dur |
Quarterly financial data (unaud
Quarterly financial data (unaudited) | 12 Months Ended |
Dec. 31, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly financial data (unaudited) | Quarterly financial data (unaudited) The following tables summarize the Company’s unaudited financial data on a quarterly basis. The sum of the quarterly earnings per-share amounts may not equal the amount reported for the full year because per-share amounts are computed independently for each quarter and for the full year based on respective weighted-average shares outstanding and dilutive securities. Quarterly financial data is summarized as follows (in millions, except per-share data): 2020 Quarters ended December 31 September 30 June 30 March 31 Product sales $ 6,334 $ 6,104 $ 5,908 $ 5,894 Gross profit from product sales $ 4,737 $ 4,543 $ 4,420 $ 4,381 Net income $ 1,615 $ 2,021 $ 1,803 $ 1,825 Earnings per share: Basic $ 2.78 $ 3.45 $ 3.07 $ 3.09 Diluted $ 2.76 $ 3.43 $ 3.05 $ 3.07 2019 Quarters ended December 31 September 30 June 30 March 31 Product sales $ 5,881 $ 5,463 $ 5,574 $ 5,286 Gross profit from product sales $ 4,628 $ 4,427 $ 4,562 $ 4,231 Net income $ 1,703 $ 1,968 $ 2,179 $ 1,992 Earnings per share: Basic $ 2.87 $ 3.29 $ 3.59 $ 3.20 Diluted $ 2.85 $ 3.27 $ 3.57 $ 3.18 |
SCHEDULE II - VALUATION AND QUA
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS | 12 Months Ended |
Dec. 31, 2019 | |
SEC Schedule, 12-09, Valuation and Qualifying Accounts [Abstract] | |
Schedule II - Valuation and Qualifying Accounts | SCHEDULE II AMGEN INC. VALUATION AND QUALIFYING ACCOUNTS Years ended December 31, 2020, 2019 and 2018 (In millions) Allowance for doubtful accounts Balance Additions Other Deductions Balance Year ended December 31, 2020 $ 26 $ 8 $ — $ 2 $ 32 Year ended December 31, 2019 $ 48 $ — $ — $ 22 $ 26 Year ended December 31, 2018 $ 51 $ 1 $ — $ 4 $ 48 |
Summary of significant accoun_2
Summary of significant accounting policies - (Policies) | 12 Months Ended |
Dec. 31, 2020 | |
Accounting Policies [Abstract] | |
Business | Business Amgen Inc. (including its subsidiaries, referred to as “Amgen,” “the Company,” “we,” “our” or “us”) is a global biotechnology pioneer that discovers, develops, manufactures and delivers innovative human therapeutics. We operate in one business segment: human therapeutics. |
Principles of consolidation | Principles of consolidation The consolidated financial statements include the accounts of Amgen as well as its majority-owned subsidiaries. We do not have any significant interests in any variable interest entities. All material intercompany transactions and balances have been eliminated in consolidation. |
Use of estimates | Use of estimates The preparation of consolidated financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results may differ from those estimates. |
Revenues and Arrangements with multiple performance obligations | Revenues Product sales and sales deductions Revenue from product sales is recognized upon transfer of control of a product to a customer, generally upon delivery, based on an amount that reflects the consideration to which we expect to be entitled, net of accruals for estimated rebates, wholesaler chargebacks, discounts and other deductions (collectively, sales deductions) and returns established at the time of sale. We analyze the adequacy of our accruals for sales deductions quarterly. Amounts accrued for sales deductions are adjusted when trends or significant events indicate that an adjustment is appropriate. Accruals are also adjusted to reflect actual results. Accruals for sales deductions are based primarily on estimates of the amounts earned or to be claimed on the related sales. These estimates take into consideration current contractual and statutory requirements, specific known market events and trends, internal and external historical data and forecasted customer buying patterns. Sales deductions are substantially product specific and therefore, for any given period, can be affected by the mix of products sold. Included in sales deductions are immaterial net adjustments related to prior-period sales due to changes in estimates. Historically, such amounts have represented less than 1% of the aggregate sales deductions charged against product sales. Returns are estimated through comparison of historical return data to their related sales on a production lot basis. Historical rates of return are determined for each product and are adjusted for known or expected changes in the marketplace specific to each product, when appropriate. Historically, sales return provisions have amounted to less than 1% of gross product sales. Changes in estimates for prior-period sales return provisions have historically been immaterial. Our payment terms vary by types and locations of customers and the products or services offered. Payment terms differ by jurisdiction and customer, but payment is generally required in a term ranging from 30 to 120 days from date of shipment or satisfaction of the performance obligation. For certain products or services and certain customer types, we may require payment before products are delivered or services are rendered to customers. Indirect taxes collected from customers and remitted to government authorities and that are related to sales of the Company’s products, primarily in Europe, are excluded from revenues. As a practical expedient, sales commissions are expensed when incurred because the amortization period would have been one year or less. These costs are recorded in Selling, general and administrative (SG&A) expense in the Consolidated Statements of Income. Other revenues Other revenues consist primarily of royalty income and corporate partner revenues. Royalties from licensees are based on third-party sales of licensed products and are recorded when the related third-party product sale occurs. Royalty income is estimated based on historical and forecasted sales trends. Corporate partner revenues are composed mainly of license fees and milestones earned and our share of commercial profits generated from collaborations. See Arrangements with multiple-performance obligations, discussed below. Arrangements with multiple-performance obligations From time to time, we enter into arrangements for the research and development (R&D), manufacture and/or commercialization of products and product candidates. Such arrangements may require us to deliver various rights, services and/or goods, including intellectual property rights/licenses, R&D services, manufacturing services and/or commercialization services. The underlying terms of these arrangements generally provide for consideration to Amgen in the form of nonrefundable, upfront license fees; development and commercial performance milestone payments; royalty payments; and/or profit sharing. In arrangements involving more than one performance obligation, each required performance obligation is evaluated to determine whether it qualifies as a distinct performance obligation based on whether (i) the customer can benefit from the good or service either on its own or together with other resources that are readily available and (ii) the good or service is separately identifiable from other promises in the contract. The consideration under the arrangement is then allocated to each separate distinct performance obligation based on its respective relative stand-alone selling price. The estimated selling price of each deliverable reflects our best estimate of what the selling price would be if the deliverable was regularly sold by us on a stand-alone basis or by using an adjusted market assessment approach if selling price on a stand-alone basis is not available. The consideration allocated to each distinct performance obligation is recognized as revenue when control of the related goods or services is transferred. Consideration associated with at-risk substantive performance milestones is recognized as revenue when it is probable that a significant reversal of the cumulative revenue recognized will not occur. We utilize the sales- and usage-based royalty exception in arrangements that resulted from the license of intellectual property, recognizing revenues generated from royalties or profit sharing as the underlying sales occur. |
Research and development costs | Research and development costs R&D costs are expensed as incurred and primarily include salaries, benefits and other staff-related costs; facilities and overhead costs; clinical trial and related clinical manufacturing costs; contract services and other outside costs; information systems’ costs; and amortization of acquired technology used in R&D with alternative future uses. R&D expenses also include costs and cost recoveries associated with third-party R&D arrangements, including upfront fees and milestones paid to third parties in connection with technologies that had not reached technological feasibility and did not have an alternative future use. Net payment or reimbursement of R&D costs is recognized when the obligations are incurred or as we become entitled to the cost recovery. See Note 8, Collaborations. |
Selling, general and administrative costs | Selling, general and administrative costs SG&A costs are primarily composed of salaries, benefits and other staff-related costs associated with sales and marketing, finance, legal and other administrative personnel; facilities and overhead costs; outside marketing, advertising and legal expenses; the U.S. healthcare reform federal excise fee on Branded Prescription Pharmaceutical Manufacturers and Importers; and other general and administrative costs. Advertising costs are expensed as incurred and were $962 million, $789 million and $674 million during the years ended December 31, 2020, 2019 and 2018, respectively. SG&A expenses also include costs and cost recoveries associated with marketing and promotion efforts under certain collaborative arrangements. Net payment or reimbursement of SG&A costs is recognized when the obligations are incurred or we become entitled to the cost recovery. See Note 8, Collaborations. |
Leases | Leases Adoption of new lease standard In February 2016, the Financial Accounting Standards Board (FASB) issued a new accounting standard that amends the guidance for the accounting and disclosure of leases. This new standard requires that lessees recognize the assets and liabilities that arise from leases on the balance sheet, including leases classified as operating leases, and that they disclose qualitative and quantitative information about leasing arrangements. The FASB subsequently issued additional amendments to address issues arising from the implementation of the new lease standard. We adopted this standard as of January 1, 2019, using the modified-retrospective method, which provides a method for recording existing leases at adoption. We used the adoption date as our date of initial application, and thus, comparative-period financial information is not presented for periods prior to the adoption date. In addition, we elected the package of practical expedients permitted under the transition guidance within the new standard, which, among other things, allowed us to carry forward the historical lease classification. Adoption of the new standard resulted in total lease liabilities of $510 million and right-of-use (ROU) assets of $439 million as of January 1, 2019. The difference between the initial lease liabilities and the ROU assets is primarily related to previously existing lease liabilities. The standard did not materially impact our Consolidated Statements of Income and had no impact on our Consolidated Statements of Cash Flows. Our accounting policies under the new standard are described below. See Note 13, Leases. Lease recognition At inception of a contract, we determine whether an arrangement is or contains a lease. For all leases, we determine the classification as either operating or financing. Operating leases are included in Other assets, Accrued liabilities and Other noncurrent liabilities in our Consolidated Balance Sheets. ROU assets represent our right to use an underlying asset for the lease term, and lease liabilities represent our obligation to make lease payments under the lease. Lease recognition occurs at the commencement date, and lease liability amounts are based on the present value of lease payments made during the lease term. Our lease terms may include options to extend or terminate the lease when it is reasonably certain that we will exercise that option. Because most of our leases do not provide information to determine an implicit interest rate, we use our incremental borrowing rate in determining the present value of lease payments. ROU assets also include any lease payments made prior to the commencement date less lease incentives received. Operating lease expense is recognized on a straight-line basis over the lease term. We have lease agreements with both lease and nonlease components, which are generally accounted for together as a single lease component. In addition, for certain vehicle and equipment leases, we apply a portfolio approach to determine the lease term and discount rate. |
Stock-based compensation | Stock-based compensation We have stock-based compensation plans under which various types of equity-based awards are granted, including restricted stock units (RSUs), performance units and stock options. The fair values of RSUs and stock option awards, which are subject only to service conditions with graded vesting, are recognized as compensation expense, generally on a straight-line basis over the service period, net of estimated forfeitures. The fair values of performance unit awards are recognized as compensation expense, generally on a straight-line basis from the grant date to the end of the performance period. See Note 4, Stock-based compensation. |
Income taxes | Income taxes We provide for income taxes based on pretax income and applicable tax rates in the various jurisdictions in which we operate. Significant judgment is required in determining our provision for income taxes and income tax assets and liabilities, including evaluating uncertainties in the application of accounting principles and complex tax laws. Deferred income taxes are recorded for the expected tax consequences of temporary differences between the bases of assets and liabilities, as well as for loss and tax credit carryforwards for financial reporting purposes and amounts recognized for income tax purposes. We record a valuation allowance to reduce our deferred tax assets to the amount of future tax benefit that is more likely than not to be realized. |
Acquisitions | Acquisitions We first determine whether a set of assets acquired constitute a business and should be accounted for as a business combination. If the assets acquired are not a business, we account for the transaction as an asset acquisition. Business combinations are accounted for by using the acquisition method of accounting. Under the acquisition method, assets acquired, including in-process research and development (IPR&D) projects, and liabilities assumed are recorded at their respective fair values as of the acquisition date in our consolidated financial statements. The excess of the fair value of consideration transferred over the fair value of the net assets acquired is recorded as goodwill. Contingent consideration obligations incurred in connection with a business combination (including the assumption of an acquiree’s liability arising from an acquisition it consummated prior to our acquisition) are recorded at their fair values on the acquisition date and remeasured at their fair values each subsequent reporting period until the related contingencies are resolved. The resulting changes in fair values are recorded in earnings. In contrast, asset acquisitions are accounted for using a cost accumulation and allocation model. Under this model, the cost of the acquisition is allocated to the assets acquired and liabilities assumed. Contingent consideration obligations incurred in connection with an asset acquisition are recorded when it is probable that they will occur and they can be reasonably estimated. See Note 2, Acquisitions, and Note 17, Fair value measurement. |
Cash equivalents | Cash equivalents We consider cash equivalents to be only those investments that are highly liquid, readily convertible to cash and which mature within three months from the date of purchase. |
Interest-bearing securities | Interest-bearing securities We consider our interest-bearing securities investment portfolio available-for-sale, and accordingly, these investments are recorded at fair value, with unrealized gains and losses recorded in Accumulated other comprehensive income (loss) (AOCI). Investments with maturities beyond one year may be classified as short-term marketable securities in the Consolidated Balance Sheets due to their highly liquid nature and because they represent the Company’s investments that are available for current operations. See Note 9, Investments, and Note 17, Fair value measurement. |
Inventories | Inventories Inventories are stated at the lower of cost or net realizable value. Cost, which includes amounts related to materials, labor and overhead, is determined in a manner that approximates the first-in, first-out method. Net realizable value is the estimated selling price in the ordinary course of business less reasonably predictable costs of completion, disposal and transportation. See Note 10, Inventories. |
Derivatives | Derivatives We recognize all of our derivative instruments as either assets or liabilities at fair value in the Consolidated Balance Sheets. The accounting for changes in the fair value of a derivative instrument depends on whether the derivative has been formally designated and qualifies as part of a hedging relationship under the applicable accounting standards and, further, on the type of hedging relationship. For derivatives formally designated as hedges, we assess both at inception and quarterly thereafter whether the hedging derivatives are highly effective in offsetting changes in either the fair value or cash flows of the hedged item. Our derivatives that are not designated and do not qualify as hedges are adjusted to fair value through current earnings. See Note 17, Fair value measurement, and Note 18, Derivative instruments. |
Property, plant and equipment, net | Property, plant and equipment, net Property, plant and equipment is recorded at historical cost, net of accumulated depreciation, amortization and, if applicable, impairment charges. We review our property, plant and equipment assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Depreciation is provided over the assets’ useful lives on a straight-line basis. Leasehold improvements are amortized on a straight-line basis over the shorter of their estimated useful lives or lease terms. See Note 11, Property, plant and equipment. |
Goodwill and other intangible assets | Goodwill and other intangible assets Finite-lived intangible assets are recorded at cost, net of accumulated amortization, and, if applicable, impairment charges. Amortization of finite-lived intangible assets is provided over their estimated useful lives on a straight-line basis or based on the pattern in which economic benefits are consumed, if reliably determinable. We review our finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. See Note 12, Goodwill and other intangible assets. The fair values of IPR&D projects acquired in a business combination that are not complete are capitalized and accounted for as indefinite-lived intangible assets until completion or abandonment of the related R&D efforts. Upon successful completion of the project, the capitalized amount is amortized over its estimated useful life. If a project is abandoned, all remaining capitalized amounts are written off immediately. There are often major risks and uncertainties associated with IPR&D projects as we are required to obtain regulatory approvals in order to be able to market the resulting products. Such approvals require completing clinical trials that demonstrate a product candidate is safe and effective. Consequently, the eventual realized value of the acquired IPR&D project may vary from its fair value at the date of acquisition, and IPR&D impairment charges may occur in future periods. Capitalized IPR&D projects are tested for impairment annually and whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. We consider various factors for potential impairment, including the current legal and regulatory environment and the competitive landscape. Adverse clinical trial results, significant delays in obtaining marketing approval, the inability to bring a product to market and the introduction or advancement of competitors’ products could result in partial or full impairment of the related intangible assets. We perform an impairment test of goodwill annually and whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. To date, an impairment of goodwill has not been recorded. See Note 12, Goodwill and other intangible assets. |
Contingencies | Contingencies In the ordinary course of business, we are involved in various legal proceedings, government investigations and other matters that are complex in nature and have outcomes that are difficult to predict. Certain of these proceedings are discussed in Note 19, Contingencies and commitments. We record accruals for loss contingencies to the extent that we conclude that it is probable that a liability has been incurred and the amount of the related loss can be reasonably estimated. We evaluate, on a quarterly basis, developments in legal proceedings and other matters that could cause an increase or decrease in the amount of the liability that has been accrued previously. |
Foreign currency translation | Foreign currency translation The net assets of international subsidiaries whose local currencies have been determined to be the functional currencies are translated into U.S. dollars using current exchange rates. The U.S. dollar effects that arise from translating net assets of these subsidiaries at changing rates are recognized in AOCI. The subsidiaries’ earnings are translated into U.S. dollars using average exchange rates. |
Equity method investments | Equity method investments The equity method of accounting is used for equity investments that give us the ability to exert significant influence, but not control, over an investee based on such factors as our ownership percentage, voting and other shareholder rights, board of director representation and the existence of other collaborative or business relationships. The equity method of accounting requires us to allocate the difference between the fair value of securities acquired and our proportionate share of the carrying value of the underlying assets (the basis difference) to various items and amortize such differences over their useful lives. Our share of the investees’ earnings or losses and amortization of basis differences, if any, are recorded one quarter in arrears in Interest and other income, net, in the Consolidated Statements of Income. We record impairment losses on our equity method investments if we deem the impairment to be other-than-temporary. We deem an impairment to be other-than-temporary based on various factors, including but not limited to, the length of time the fair value is below the carrying value, volatility of the security price and our intent and ability to retain the investment to allow for a recovery in fair value. |
Other recently adopted pronouncement and Other recent accounting pronouncements | Recent accounting pronouncements In June 2016, the FASB issued a new accounting standard that amends the guidance for measuring and recording credit losses on financial assets measured at amortized cost by replacing the incurred-loss model with an expected-loss model. Accordingly, these financial assets are now presented at the net amount expected to be collected. This new standard also requires that credit losses related to available-for-sale debt securities be recorded as an allowance through net income rather than reducing the carrying amount under the former other-than-temporary-impairment model. We adopted this standard as of January 1, 2020, using a modified-retrospective approach. Adoption of the standard did not have a material impact on our consolidated financial statements. In March 2020, the FASB issued a new accounting standard to ease the financial reporting burdens of the expected market transition from the London Interbank Offered Rate (LIBOR) and other interbank offered rates to alternative reference rates, commonly referred to as reference rate reform. The new standard provides temporary optional expedients and exceptions to current GAAP guidance on contract modifications and hedge accounting. Specifically, a modification to transition to an alternative reference rate is treated as an event that does not require contract remeasurement or reassessment of a previous accounting treatment. Moreover, for all types of hedging relationships, an entity may change the reference rate without having to dedesignate the hedging relationship. The standard is generally effective for all contract modifications made and hedging relationships evaluated through December 31, 2022. In January 2021, the FASB issued a new accounting standard to expand on the scope of the original March 2020 standard to include derivative instruments on discounting transactions. We are currently evaluating the impact that both standards will have on our consolidated financial statements. |
Acquisitions - (Tables)
Acquisitions - (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions, by Acquisition | The following table summarizes the consideration transferred and the allocation of the estimated accumulated cost, including tax adjustments, to the assets acquired and liabilities assumed (in millions): Amounts Cash purchase price $ 13,400 Transaction costs 40 Accumulated cost (consideration transferred) $ 13,440 Intangible assets: Developed-product-technology rights $ 13,007 Marketing-related rights 195 Inventory 367 Deferred tax liability, net (24) Deferred credit (96) Other liabilities, net (9) Total assets acquired, net $ 13,440 |
Aggregate acquisition date consideration to acquire an entity | The aggregate share acquisition date consideration to acquire the remaining 50% ownership in K-A and the fair value of Amgen’s preacquisition investment consisted of the following (in millions): Amounts Total cash paid to Kirin $ 780 Fair value of contingent consideration obligation 45 Loss on settlement of preexisting relationship (168) Total consideration transferred to acquire K-A 657 Fair value of Amgen’s investment in K-A 825 Total acquisition date fair value $ 1,482 |
Revenues (Tables)
Revenues (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of revenue by product and by geographic area | Revenues were as follows (in millions): Year ended December 31, 2020 Year ended December 31, 2019 Year ended December 31, 2018 U.S. ROW Total U.S. ROW Total U.S. ROW Total Enbrel ® (etanercept) $ 4,855 $ 141 $ 4,996 $ 5,050 $ 176 $ 5,226 $ 4,807 $ 207 $ 5,014 Prolia ® (denosumab) 1,830 933 2,763 1,772 900 2,672 1,500 791 2,291 Neulasta ® (pegfilgrastim) 2,001 292 2,293 2,814 407 3,221 3,866 609 4,475 Otezla ®(1) 1,790 405 2,195 139 39 178 — — — XGEVA ® (denosumab) 1,405 494 1,899 1,457 478 1,935 1,338 448 1,786 Aranesp ® (darbepoetin alfa) 629 939 1,568 758 971 1,729 942 935 1,877 KYPROLIS ® (carfilzomib) 710 355 1,065 654 390 1,044 583 385 968 Repatha ® (evolocumab) 459 428 887 376 285 661 358 192 550 Other products 4,306 2,268 6,574 3,511 2,027 5,538 4,035 1,537 5,572 Total product sales (2) 17,985 6,255 24,240 16,531 5,673 22,204 17,429 5,104 22,533 Other revenues 511 673 1,184 693 465 1,158 929 285 1,214 Total revenues $ 18,496 $ 6,928 $ 25,424 $ 17,224 $ 6,138 $ 23,362 $ 18,358 $ 5,389 $ 23,747 ____________ (1) Otezla ® was acquired on November 21, 2019. |
Revenues earned from major customers | Certain information with respect to these customers was as follows (dollar amounts in millions): Years ended December 31, 2020 2019 2018 AmerisourceBergen Corporation: Gross product sales $ 14,743 $ 12,301 $ 12,091 % of total gross revenues 34 % 33 % 33 % McKesson Corporation: Gross product sales $ 13,779 $ 11,795 $ 11,434 % of total gross revenues 32 % 31 % 31 % Cardinal Health, Inc.: Gross product sales $ 7,332 $ 6,538 $ 7,475 % of total gross revenues 17 % 17 % 20 % |
Stock-based compensation (Table
Stock-based compensation (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Components of stock-based compensation expense recognized in the Consolidated Statements of Income | The following table reflects the components of stock-based compensation expense recognized in our Consolidated Statements of Income (in millions): Years ended December 31, 2020 2019 2018 RSUs $ 178 $ 168 $ 165 Performance units 118 105 117 Stock options 34 35 29 Total stock-based compensation expense, pretax 330 308 311 Tax benefit from stock-based compensation expense (72) (67) (67) Total stock-based compensation expense, net of tax $ 258 $ 241 $ 244 |
Summary of RSUs | The following table summarizes information regarding our RSUs: Year ended December 31, 2020 Units Weighted-average Balance nonvested as of December 31, 2019 3.1 $ 174.97 Granted 1.1 $ 235.63 Vested (1.0) $ 167.23 Forfeited (0.2) $ 190.15 Balance nonvested as of December 31, 2020 3.0 $ 198.11 |
Weighted-average assumptions used and the resulting weighted-average grant date fair value of stock options | The weighted-average assumptions used in the option valuation model and the resulting weighted-average grant date fair values of stock options granted were as follows: Years ended December 31, 2020 2019 2018 Closing price of our common stock on grant date $ 236.36 $ 177.31 $ 177.46 Expected volatility (average of implied and historical volatility) 28.1 % 23.5 % 24.6 % Expected life (in years) 5.8 5.8 5.8 Risk-free interest rate 0.4 % 2.4 % 2.8 % Expected dividend yield 3.0 % 3.1 % 2.9 % Fair value of stock options granted $ 42.34 $ 30.47 $ 34.60 |
Summary of stock options | The following table summarizes information regarding our stock options: Year ended December 31, 2020 Options Weighted- Weighted- Aggregate Balance unexercised as of December 31, 2019 4.8 $ 157.00 Granted 1.0 $ 236.36 Exercised (0.9) $ 117.90 Expired/forfeited (0.2) $ 178.36 Balance unexercised as of December 31, 2020 4.7 $ 179.90 7.3 $ 243 Vested or expected to vest as of December 31, 2020 4.5 $ 178.37 7.3 $ 239 Exercisable as of December 31, 2020 1.5 $ 150.80 5.5 $ 120 |
Weighted average assumptions used and the resulting weighted average grant date fair value of performance units | The weighted-average assumptions used in the payout simulation model and the resulting weighted-average grant date fair values of performance units granted were as follows: Years ended December 31, 2020 2019 2018 Closing price of our common stock on grant date $ 236.36 $ 177.31 $ 177.93 Volatility 27.5 % 22.1 % 23.8 % Risk-free interest rate 0.2 % 2.3 % 2.6 % Fair value of units granted $ 249.07 $ 188.40 $ 189.21 |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Schedule of income before income tax, domestic and foreign | Income before income taxes included the following (in millions): Years ended December 31, 2020 2019 2018 Domestic $ 4,087 $ 4,371 $ 4,856 Foreign 4,046 4,767 4,689 Total income before income taxes $ 8,133 $ 9,138 $ 9,545 |
Provision for income taxes | The provision for income taxes included the following (in millions): Years ended December 31, 2020 2019 2018 Current provision: Federal $ 921 $ 1,284 $ 1,270 State 34 39 17 Foreign 277 277 227 Total current provision 1,232 1,600 1,514 Deferred (benefit) provision: Federal (321) (276) (317) State 9 (22) (7) Foreign (51) (6) (39) Total deferred benefit (363) (304) (363) Total provision for income taxes $ 869 $ 1,296 $ 1,151 |
Significant components of deferred tax assets and liabilities | Significant components of our deferred tax assets and liabilities were as follows (in millions): December 31, 2020 2019 Deferred income tax assets: NOL and credit carryforwards $ 794 $ 800 Accrued expenses 561 457 Expenses capitalized for tax 144 170 Stock-based compensation 92 91 Other 301 269 Total deferred income tax assets 1,892 1,787 Valuation allowance (571) (517) Net deferred income tax assets 1,321 1,270 Deferred income tax liabilities: Acquired intangible assets (903) (1,288) Debt (282) (210) Fixed assets (148) (53) Other (189) (233) Total deferred income tax liabilities (1,522) (1,784) Total deferred income taxes, net $ (201) $ (514) |
Reconciliation of total gross amounts of unrecognized tax benefits (excluding interest, penalties, foreign tax credits and the federal tax benefit of state taxes related to unrecognized tax benefits) | The reconciliations of the total gross amounts of UTBs were as follows (in millions): Years ended December 31, 2020 2019 2018 Beginning balance $ 3,287 $ 3,061 $ 2,953 Additions based on tax positions related to the current year 165 215 173 Additions based on tax positions related to prior years 3 22 13 Reductions for tax positions of prior years (35) (11) (17) Settlements (68) — (61) Ending balance $ 3,352 $ 3,287 $ 3,061 |
Reconciliation between the federal statutory tax rate and effective tax rate | The reconciliations between the federal statutory tax rate applied to income before income taxes and our effective tax rate were as follows: Years ended December 31, 2020 2019 2018 Federal statutory tax rate 21.0 % 21.0 % 21.0 % Foreign earnings (4.7) % (4.5) % (4.3) % Foreign-derived intangible income (0.7) % (0.7) % (0.4) % Credits, Puerto Rico Excise Tax (2.9) % (2.6) % (2.5) % 2017 Tax Act, net impact on intercompany sales — % — % (1.8) % Interest on uncertain tax positions 1.1 % 1.6 % 1.2 % Credits, primarily federal R&D (1.4) % (1.0) % (0.8) % Audit settlements (1.0) % — % (0.3) % Other, net (0.7) % 0.4 % — % Effective tax rate 10.7 % 14.2 % 12.1 % |
Earnings per share (Tables)
Earnings per share (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |
Computation for basic and diluted earnings per share | The computations for basic and diluted EPS were as follows (in millions, except per-share data): Years ended December 31, 2020 2019 2018 Income (Numerator): Net income for basic and diluted EPS $ 7,264 $ 7,842 $ 8,394 Shares (Denominator): Weighted-average shares for basic EPS 586 605 661 Effect of dilutive securities 4 4 4 Weighted-average shares for diluted EPS 590 609 665 Basic EPS $ 12.40 $ 12.96 $ 12.70 Diluted EPS $ 12.31 $ 12.88 $ 12.62 |
Investments - (Tables)
Investments - (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Investments, Debt and Equity Securities [Abstract] | |
Amortized cost, gross unrealized gains, gross unrealized losses and estimated fair values of available-for-sale investments by type of security | The amortized cost, gross unrealized gains, gross unrealized losses and fair values of interest-bearing securities, all of which are considered available-for-sale, by type of security were as follows (in millions): Types of securities as of December 31, 2020 Amortized Gross Gross Fair U.S. Treasury notes $ 129 $ 1 $ — $ 130 U.S. Treasury bills 4,948 — — 4,948 Corporate debt securities: Financial — — — — Industrial — — — — Other — — — — Residential-mortgage-backed securities — — — — Money market mutual funds 4,765 — — 4,765 Other short-term interest-bearing securities 2 — — 2 Total available-for-sale investments $ 9,844 $ 1 $ — $ 9,845 Types of securities as of December 31, 2019 Amortized Gross Gross Fair U.S. Treasury notes $ 359 $ 1 $ — $ 360 U.S. Treasury bills — — — — Corporate debt securities: Financial 1,108 13 — 1,121 Industrial 824 10 — 834 Other 195 3 — 198 Residential-mortgage-backed securities 181 1 — 182 Money market mutual funds 5,250 — — 5,250 Other short-term interest-bearing securities 289 — — 289 Total available-for-sale investments $ 8,206 $ 28 $ — $ 8,234 |
Fair values of available-for-sale investments by classification in the Consolidated Balance Sheets | The fair values of available-for-sale investments by location in the Consolidated Balance Sheets were as follows (in millions): December 31, Consolidated Balance Sheets locations 2020 2019 Cash and cash equivalents $ 5,464 $ 5,360 Marketable securities 4,381 2,874 Total available-for-sale investments $ 9,845 $ 8,234 |
Fair values of available-for-sale interest-bearing security investments by contractual maturity | The fair values of available-for-sale investments by contractual maturity, except for mortgage- and asset-backed securities that do not have a single maturity date, were as follows (in millions): December 31, Contractual maturities 2020 2019 Maturing in one year or less $ 9,795 $ 5,629 Maturing after one year through three years 50 2,304 Maturing after three years through five years — 119 Residential-mortgage-backed securities — 182 Total available-for-sale investments $ 9,845 $ 8,234 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Inventory Disclosure [Abstract] | |
Inventories | Inventories consisted of the following (in millions): December 31, 2020 2019 Raw materials $ 486 $ 358 Work in process 2,437 2,227 Finished goods 970 999 Total inventories $ 3,893 $ 3,584 |
Property, plant and equipment (
Property, plant and equipment (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Components of property, plant and equipment | Property, plant and equipment consisted of the following (dollar amounts in millions): December 31, Useful life (in years) 2020 2019 Land — $ 259 $ 263 Buildings and improvements 10-40 3,857 3,757 Manufacturing equipment 8-12 2,865 2,655 Laboratory equipment 8-12 1,257 1,236 Fixed equipment 12 2,406 2,338 Capitalized software 3-5 1,216 1,154 Other 5-10 1,091 975 Construction in progress — 915 907 Property, plant and equipment, gross 13,866 13,285 Less accumulated depreciation and amortization (8,977) (8,357) Property, plant and equipment, net $ 4,889 $ 4,928 |
Property, plant and equipment by geographic information | Certain geographic information with respect to property, plant and equipment, net (long-lived assets), was as follows (in millions): December 31, 2020 2019 United States $ 2,473 $ 2,433 Puerto Rico 1,331 1,402 ROW 1,085 1,093 Total property, plant and equipment, net $ 4,889 $ 4,928 |
Goodwill and other intangible a
Goodwill and other intangible assets - (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of goodwill | The changes in the carrying amounts of goodwill were as follows (in millions): December 31, 2020 2019 Beginning balance $ 14,703 $ 14,699 Addition from acquisitions — 26 Currency translation adjustments (14) (22) Ending balance $ 14,689 $ 14,703 |
Schedule of identifiable intangible assets | Other intangible assets consisted of the following (in millions): December 31, 2020 2019 Gross Accumulated Other intangible Gross Accumulated Other intangible Finite-lived intangible assets: Developed-product-technology rights $ 25,591 $ (10,564) $ 15,027 $ 25,575 $ (8,322) $ 17,253 Licensing rights 3,743 (2,791) 952 3,761 (2,398) 1,363 Marketing-related rights 1,367 (1,041) 326 1,382 (965) 417 R&D technology rights 1,317 (1,065) 252 1,273 (947) 326 Total finite-lived intangible assets 32,018 (15,461) 16,557 31,991 (12,632) 19,359 Indefinite-lived intangible assets: IPR&D 30 — 30 54 — 54 Total other intangible assets $ 32,048 $ (15,461) $ 16,587 $ 32,045 $ (12,632) $ 19,413 |
Leases - (Tables)
Leases - (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Leases [Abstract] | |
Summary information, components of lease costs, cash and noncash information on leases and other lease information | The following table summarizes information related to our leases, all of which are classified as operating, included in our Consolidated Balance Sheets (in millions): December 31, Consolidated Balance Sheets locations 2020 2019 Assets: Other assets $ 408 $ 469 Liabilities: Accrued liabilities $ 153 $ 140 Other noncurrent liabilities 306 388 Total lease liabilities $ 459 $ 528 The components of net lease costs were as follows (in millions): Years ended December 31, Lease costs 2020 2019 Operating (1) $ 223 $ 204 Sublease income (34) (33) Total net lease costs $ 189 $ 171 ____________ (1) Includes short-term leases and variable lease costs, which were not material for the years ended December 31, 2020 and 2019. The weighted-average remaining lease terms and weighted-average discount rates were as follows: December 31, 2020 2019 Weighted-average remaining lease term (in years) 3.7 4.1 Weighted-average discount rate 3.1 % 3.3 % Cash and noncash information related to our leases was as follows (in millions): Years ended December 31, 2020 2019 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows for operating leases $ 177 $ 148 ROU assets obtained in exchange for lease obligations: Operating leases $ 101 $ 163 |
Maturities of lease liabilities | Maturities of lease liabilities as of December 31, 2020, were as follows (in millions): Maturity dates Amounts 2021 $ 164 2022 132 2023 105 2024 36 2025 15 Thereafter 36 Total lease payments (1) 488 Less imputed interest (29) Present value of lease liabilities $ 459 ____________ |
Other current assets and accr_2
Other current assets and accrued liabilities (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Payables and Accruals [Abstract] | |
Schedule of Other Current Assets | Other current assets consisted of the following (in millions): December 31, 2020 2019 Prepaid expenses $ 1,156 $ 939 Corporate partner receivables 583 485 Tax receivables 216 186 Other 124 278 Total other current assets $ 2,079 $ 1,888 |
Schedule of Accrued Liabilities | Accrued liabilities consisted of the following (in millions): December 31, 2020 2019 Sales deductions $ 4,801 $ 3,880 Employee compensation and benefits 1,098 981 Dividends payable 1,018 946 Income taxes payable 828 557 Sales returns reserve 474 564 Other 1,922 1,583 Total accrued liabilities $ 10,141 $ 8,511 |
Financing arrangements (Tables)
Financing arrangements (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Debt Disclosure [Abstract] | |
Carrying values and the fixed contractual coupon rates of long-term borrowings | Our borrowings consisted of the following (in millions): December 31, 2020 2019 4.50% notes due 2020 (4.50% 2020 Notes) — 300 2.125% notes due 2020 (2.125% 2020 Notes) — 750 Floating Rate Notes due 2020 — 300 2.20% notes due 2020 (2.20% 2020 Notes) — 700 3.45% notes due 2020 (3.45% 2020 Notes) — 900 4.10% notes due 2021 (4.10% 2021 Notes) — 1,000 1.85% notes due 2021 (1.85% 2021 Notes) — 750 3.875% notes due 2021 (3.875% 2021 Notes) — 1,750 1.25% €1,250 million notes due 2022 (1.25% 2022 euro Notes) 1,527 1,402 2.70% notes due 2022 (2.70% 2022 Notes) 500 500 2.65% notes due 2022 (2.65% 2022 Notes) 1,500 1,500 3.625% notes due 2022 (3.625% 2022 Notes) 750 750 0.41% CHF700 million bonds due 2023 (0.41% 2023 Swiss franc Bonds) 791 725 2.25% notes due 2023 (2.25% 2023 Notes) 750 750 3.625% notes due 2024 (3.625% 2024 Notes) 1,400 1,400 1.90% notes due 2025 (1.90% 2025 Notes) 500 — 3.125% notes due 2025 (3.125% 2025 Notes) 1,000 1,000 2.00% €750 million notes due 2026 (2.00% 2026 euro Notes) 916 841 2.60% notes due 2026 (2.60% 2026 Notes) 1,250 1,250 5.50% £475 million notes due 2026 (5.50% 2026 pound sterling Notes) 649 630 2.20% notes due 2027 (2.20% 2027 Notes) 1,750 — 3.20% notes due 2027 (3.20% 2027 Notes) 1,000 1,000 4.00% £700 million notes due 2029 (4.00% 2029 pound sterling Notes) 957 928 2.45% notes due 2030 (2.45% 2030 Notes) 1,250 — 2.30% notes due 2031 (2.30% 2031 Notes) 1,250 — 6.375% notes due 2037 (6.375% 2037 Notes) 478 552 6.90% notes due 2038 (6.90% 2038 Notes) 254 291 6.40% notes due 2039 (6.40% 2039 Notes) 333 466 3.15% notes due 2040 (3.15% 2040 Notes) 2,000 — 5.75% notes due 2040 (5.75% 2040 Notes) 373 412 4.95% notes due 2041 (4.95% 2041 Notes) 600 600 5.15% notes due 2041 (5.15% 2041 Notes) 729 974 5.65% notes due 2042 (5.65% 2042 Notes) 415 487 5.375% notes due 2043 (5.375% 2043 Notes) 185 261 4.40% notes due 2045 (4.40% 2045 Notes) 2,250 2,250 4.563% notes due 2048 (4.563% 2048 Notes) 1,415 1,415 3.375% notes due 2050 (3.375% 2050 Notes) 2,250 — 4.663% notes due 2051 (4.663% 2051 Notes) 3,541 3,541 2.77% notes due 2053 (2.77% 2053 Notes) 940 — Other notes due 2097 100 100 Unamortized bond discounts, premiums and issuance costs, net (1,188) (868) Fair value adjustments 566 296 Other 5 — Total carrying value of debt 32,986 29,903 Less current portion (91) (2,953) Total long-term debt $ 32,895 $ 26,950 |
Schedule of interest rate derivatives | The effective interest rates on notes for which we have entered into interest rate swap contracts and the related notional amounts of these contracts were as follows (dollar amounts in millions): December 31, 2020 December 31, 2019 Notes Notional amounts Effective interest rates Notional amounts Effective interest rates 3.45% 2020 Notes $ — LIBOR + 1.1% $ 900 LIBOR + 1.1% 4.10% 2021 Notes — LIBOR + 1.7% 1,000 LIBOR + 1.7% 3.875% 2021 Notes — LIBOR + 2.0% 1,750 LIBOR + 2.0% 3.625% 2022 Notes 750 LIBOR + 2.7% 750 LIBOR + 1.6% 3.625% 2024 Notes 1,400 LIBOR + 3.2% 1,400 LIBOR + 1.4% 3.125% 2025 Notes 1,000 LIBOR + 1.8% 1,000 LIBOR + 0.9% 2.60% 2026 Notes 1,250 LIBOR + 1.8% 1,250 LIBOR + 0.3% 4.663% 2051 Notes (1) 1,500 LIBOR + 2.6% 1,500 LIBOR + 0.0% Total notional amounts $ 5,900 $ 9,550 ____________ (1) Excludes an additional 1.5% of interest for the difference between the coupon rate paid to noteholders and the fixed rate received under the interest rate swap contracts. |
Schedule of Long-term Debt Instruments Exchanged | The following principal amounts of each series of Old Notes were validly tendered and subsequently cancelled in connection with the Exchange Offer (in millions): Principal amount exchanged 6.375% 2037 Notes $ 74 6.90% 2038 Notes 37 6.40% 2039 Notes 133 5.75% 2040 Notes 39 5.15% 2041 Notes 245 5.65% 2042 Notes 72 5.375% 2043 Notes 76 |
Aggregate contractual maturities of long-term debt obligations | The aggregate contractual maturities of all borrowings due subsequent to December 31, 2020, are as follows (in millions): Maturity dates Amounts 2021 $ — 2022 4,277 2023 1,541 2024 1,400 2025 1,500 Thereafter 24,890 Total $ 33,608 |
Stockholders' equity (Tables)
Stockholders' equity (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Equity [Abstract] | |
Summary of activity under our stock repurchase program | Activity under our stock repurchase program, on a trade date basis, was as follows (in millions): Years ended December 31, 2020 2019 2018 Shares Dollars Shares* Dollars Shares* Dollars First quarter 4.3 $ 933 15.9 $ 3,031 56.4 $ 10,787 Second quarter 2.6 591 13.1 2,349 18.2 3,190 Third quarter 3.0 752 6.2 1,170 8.7 1,713 Fourth quarter 5.3 1,221 5.1 1,090 11.1 2,165 Total stock repurchases 15.2 $ 3,497 40.2 $ 7,640 94.5 $ 17,855 * Total shares do not add due to rounding. |
Components of accumulated other comprehensive income | The components of AOCI were as follows (in millions): Foreign Cash flow Available-for-sale Other AOCI Balance as of December 31, 2017 $ (529) $ (6) $ (144) $ — $ (679) Cumulative effect of change in accounting principle, net of tax — — (9) — (9) Foreign currency translation adjustments (141) — — — (141) Unrealized gains (losses) — 61 (556) — (495) Reclassification adjustments to income — 262 365 — 627 Other losses — — — (2) (2) Income taxes — (76) 6 — (70) Balance as of December 31, 2018 (670) 241 (338) (2) (769) Foreign currency translation adjustments (48) — — — (48) Unrealized gains — 127 424 — 551 Reclassification adjustments to income — (211) (56) — (267) Other losses — — — (5) (5) Income taxes — 18 (8) — 10 Balance as of December 31, 2019 (718) 175 22 (7) (528) Foreign currency translation adjustments 9 — — — 9 Unrealized (losses) gains — (61) 6 — (55) Reclassification adjustments to income — (501) (33) — (534) Other losses — — — (7) (7) Income taxes — 124 6 — 130 Balance as of December 31, 2020 $ (709) $ (263) $ 1 $ (14) $ (985) |
Reclassifications out of accumulated other comprehensive income | Reclassifications out of AOCI and into earnings were as follows (in millions): Years ended December 31, Components of AOCI 2020 2019 2018 Consolidated Statements of Income locations Cash flow hedges: Foreign currency contract gains (losses) $ 178 $ 101 $ (21) Product sales Cross-currency swap contract gains (losses) 323 110 (241) Interest and other income, net 501 211 (262) Income before income taxes (110) (46) 55 Provision for income taxes $ 391 $ 165 $ (207) Net income Available-for-sale securities: Net realized gains (losses) $ 33 $ 56 $ (365) Interest and other income, net (7) (14) 3 Provision for income taxes $ 26 $ 42 $ (362) Net income |
Fair value measurement - (Table
Fair value measurement - (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair value of each major class of financial assets and liabilities measured at fair value on a recurring basis | The fair values of each major class of the Company’s financial assets and liabilities measured at fair value on a recurring basis were as follows (in millions): Fair value measurement as of December 31, 2020, using: Quoted prices in Significant other Significant Total Assets: Available-for-sale securities: U.S. Treasury notes $ 130 $ — $ — $ 130 U.S. Treasury bills 4,948 — — 4,948 Corporate debt securities: Financial — — — — Industrial — — — — Other — — — — Residential-mortgage-backed securities — — — — Money market mutual funds 4,765 — — 4,765 Other short-term interest-bearing securities — 2 — 2 Equity securities 477 — — 477 Derivatives: Foreign currency contracts — 28 — 28 Cross-currency swap contracts — 255 — 255 Interest rate swap contracts — 66 — 66 Total assets $ 10,320 $ 351 $ — $ 10,671 Liabilities: Derivatives: Foreign currency contracts $ — $ 237 $ — $ 237 Cross-currency swap contracts — 318 — 318 Interest rate swap contracts — 15 — 15 Contingent consideration obligations — — 33 33 Total liabilities $ — $ 570 $ 33 $ 603 Fair value measurement as of December 31, 2019, using: Quoted prices in Significant other Significant Total Assets: Available-for-sale securities: U.S. Treasury notes $ 360 $ — $ — $ 360 U.S. Treasury bills — — — — Corporate debt securities: Financial — 1,121 — 1,121 Industrial — 834 — 834 Other — 198 — 198 Residential-mortgage-backed securities — 182 — 182 Money market mutual funds 5,250 — — 5,250 Other short-term interest-bearing securities — 289 — 289 Equity securities 303 — — 303 Derivatives: Foreign currency contracts — 224 — 224 Cross-currency swap contracts — 66 — 66 Interest rate swap contracts — 259 — 259 Total assets $ 5,913 $ 3,173 $ — $ 9,086 Liabilities: Derivatives: Foreign currency contracts $ — $ 31 $ — $ 31 Cross-currency swap contracts — 315 — 315 Interest rate swap contracts — — — — Contingent consideration obligations — — 61 61 Total liabilities $ — $ 346 $ 61 $ 407 |
Derivative instruments - (Table
Derivative instruments - (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of notional amounts and interest rates for cross-currency swaps | The notional amounts and interest rates of our cross-currency swaps as of December 31, 2020, were as follows (notional amounts in millions): Foreign currency U.S. dollars Hedged notes Notional amounts Interest rates Notional amounts Interest rates 1.25% 2022 euro Notes € 1,250 1.3 % $ 1,388 3.2 % 0.41% 2023 Swiss franc Bonds CHF 700 0.4 % $ 704 3.4 % 2.00% 2026 euro Notes € 750 2.0 % $ 833 3.9 % 5.50% 2026 pound sterling Notes £ 475 5.5 % $ 747 6.0 % 4.00% 2029 pound sterling Notes £ 700 4.0 % $ 1,111 4.5 % |
Effective portion of the unrealized gain (loss) recognized in Other Comprehensive Income for our derivative instruments designated as cash flow hedges | The unrealized losses and gains recognized in AOCI for our derivative instruments designated as cash flow hedges were as follows (in millions): Years ended December 31, Derivatives in cash flow hedging relationships 2020 2019 2018 Foreign currency contracts $ (251) $ 148 $ 348 Cross-currency swap contracts 190 (21) (287) Forward interest rate contracts — — — Total unrealized (losses) gains $ (61) $ 127 $ 61 |
Derivatives in fair value hedging relationships | The hedged liabilities and related cumulative-basis adjustments for fair value hedges of those liabilities were recorded in the Consolidated Balance Sheets as follows (in millions): Carrying amounts of hedged liabilities (1) Cumulative amounts of fair value hedging adjustments related to the carrying amounts of the hedged liabilities (2) December 31, December 31, Consolidated Balance Sheets locations 2020 2019 2020 2019 Current portion of long-term debt $ 89 $ 903 $ 89 $ 4 Long-term debt $ 6,258 $ 8,814 $ 477 $ 292 ____________ (1) Current portion of long-term debt includes $89 million of carrying value with discontinued hedging relationships as of December 31, 2020. Long-term debt includes $525 million and $136 million of carrying value with discontinued hedging relationships as of December 31, 2020, and December 31, 2019, respectively. (2) Current portion of long-term debt includes $89 million of hedging adjustments on discontinued hedging relationships as of December 31, 2020. Long-term debt includes $425 million and $36 million of hedging adjustments on discontinued hedging relationships as of December 31, 2020, and December 31, 2019, respectively. |
Summary of amounts of income and expense line items | The following tables summarize the amounts recorded in income and expense line items and the effects thereon from fair value and cash flow hedging, including discontinued hedging relationships (in millions): Year ended December 31, 2020 Product sales Interest and other income, net Interest (expense), net Total amounts recorded in income and (expense) line items presented in the Consolidated Statements of Income $ 24,240 $ 256 $ (1,262) The effects of cash flow and fair value hedging: Gains on cash flow hedging relationships reclassified out of AOCI: Foreign currency contracts $ 178 $ — $ — Cross-currency swap contracts $ — $ 323 $ — Gains (losses) on fair value hedging relationships—interest rate swap agreements: Hedged items (1) $ — $ — $ 315 Derivatives designated as hedging instruments $ — $ — $ (204) Year ended December 31, 2019 Product sales Interest and other income, net Interest (expense), net Total amounts recorded in income and (expense) line items presented in the Consolidated Statements of Income $ 22,204 $ 753 $ (1,289) The effects of cash flow and fair value hedging: Gains on cash flow hedging relationships reclassified out of AOCI: Foreign currency contracts $ 101 $ — $ — Cross-currency swap contracts $ — $ 110 $ — (Losses) gains on fair value hedging relationships—interest rate swap agreements: Hedged items (1) $ — $ — $ (349) Derivatives designated as hedging instruments $ — $ — $ 352 Year ended December 31, 2018 Product sales Interest and other income (expense), net Interest (expense), net Total amounts recorded in income and (expense) line items presented in the Consolidated Statements of Income $ 22,533 $ 674 $ (1,392) The effects of cash flow and fair value hedging: (Losses) on cash flow hedging relationships reclassified out of AOCI: Foreign currency contracts $ (21) $ — $ — Cross-currency swap contracts $ — $ (241) $ — Gains (losses) on fair value hedging relationships—interest rate swap agreements: Hedged items (1) $ — $ — $ 65 Derivatives designated as hedging instruments $ — $ — $ (42) __________ |
Fair values of derivatives included in the Consolidated Balance Sheets | The fair values of derivatives included in the Consolidated Balance Sheets were as follows (in millions): Derivative assets Derivative liabilities December 31, 2020 Consolidated Balance Sheets locations Fair values Consolidated Balance Sheets locations Fair values Derivatives designated as hedging instruments: Foreign currency contracts Other current assets/ Other assets $ 28 Accrued liabilities/ Other noncurrent liabilities $ 237 Cross-currency swap contracts Other current assets/ Other assets 255 Accrued liabilities/ Other noncurrent liabilities 318 Interest rate swap contracts Other current assets/ Other assets 66 Accrued liabilities/ Other noncurrent liabilities 15 Total derivatives designated as hedging instruments 349 570 Derivatives not designated as hedging instruments: Foreign currency contracts Other current assets — Accrued liabilities — Total derivatives not designated as hedging instruments — — Total derivatives $ 349 $ 570 Derivative assets Derivative liabilities December 31, 2019 Consolidated Balance Sheets locations Fair values Consolidated Balance Sheets locations Fair values Derivatives designated as hedging instruments: Foreign currency contracts Other current assets/ Other assets $ 223 Accrued liabilities/ Other noncurrent liabilities $ 31 Cross-currency swap contracts Other current assets/ Other assets 66 Accrued liabilities/ Other noncurrent liabilities 315 Interest rate swap contracts Other current assets/ Other assets 259 Accrued liabilities/ Other noncurrent liabilities — Total derivatives designated as hedging instruments 548 346 Derivatives not designated as hedging instruments: Foreign currency contracts Other current assets 1 Accrued liabilities — Total derivatives not designated as hedging instruments 1 — Total derivatives $ 549 $ 346 |
Contingencies and commitments -
Contingencies and commitments - (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
U.S. repatriation tax commitments | The following table summarizes the remaining scheduled repatriation tax payments as of December 31, 2020 (in millions): Amounts 2021 $ 587 2022 587 2023 1,100 2024 1,467 2025 1,834 Total remaining U.S. repatriation tax commitments $ 5,575 |
Quarterly financial data (una_2
Quarterly financial data (unaudited) (Tables) | 12 Months Ended |
Dec. 31, 2020 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly financial data (unaudited) | Quarterly financial data is summarized as follows (in millions, except per-share data): 2020 Quarters ended December 31 September 30 June 30 March 31 Product sales $ 6,334 $ 6,104 $ 5,908 $ 5,894 Gross profit from product sales $ 4,737 $ 4,543 $ 4,420 $ 4,381 Net income $ 1,615 $ 2,021 $ 1,803 $ 1,825 Earnings per share: Basic $ 2.78 $ 3.45 $ 3.07 $ 3.09 Diluted $ 2.76 $ 3.43 $ 3.05 $ 3.07 2019 Quarters ended December 31 September 30 June 30 March 31 Product sales $ 5,881 $ 5,463 $ 5,574 $ 5,286 Gross profit from product sales $ 4,628 $ 4,427 $ 4,562 $ 4,231 Net income $ 1,703 $ 1,968 $ 2,179 $ 1,992 Earnings per share: Basic $ 2.87 $ 3.29 $ 3.59 $ 3.20 Diluted $ 2.85 $ 3.27 $ 3.57 $ 3.18 |
Summary of significant accoun_3
Summary of significant accounting policies - Narrative (Details) $ in Millions | 12 Months Ended | |||
Dec. 31, 2020USD ($)segment | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Jan. 01, 2019USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Number of business segment | segment | 1 | |||
Change in estimate of sales deductions for prior period sales as a pct of total sales deductions (less than) | 1.00% | |||
Sales return provisions as a percentage of gross product sales (less than) | 1.00% | |||
Advertising cost | $ 962 | $ 789 | $ 674 | |
Present value of lease liabilities | 459 | 528 | ||
Operating lease, Right-of-use asset | $ 408 | $ 469 | ||
Accounting Standards Update 2016-02 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Present value of lease liabilities | $ 510 | |||
Operating lease, Right-of-use asset | $ 439 | |||
Minimum [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Revenue payment term | 30 days | |||
Maximum [Member] | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Revenue payment term | 120 days |
Acquisitions - Narrative (Detai
Acquisitions - Narrative (Details) $ in Millions | Nov. 21, 2019USD ($) | Jul. 15, 2019USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2020USD ($)market | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) |
Business Acquisition [Line Items] | ||||||
Goodwill | $ 14,689 | $ 14,703 | $ 14,699 | |||
Estimated blended statutory rate | 20.00% | |||||
Kirin-Amgen, Inc. (K-A) | ||||||
Business Acquisition [Line Items] | ||||||
Percentage of voting interests acquired | 50.00% | |||||
Ownership percentage | 50.00% | |||||
Otezla | ||||||
Business Acquisition [Line Items] | ||||||
Approved markets | market | 50 | |||||
Cash paid | $ 13,400 | |||||
Adjustments to carrying value of intangible assets | 119 | |||||
Adjustments to deferred tax liability | 24 | |||||
Adjustments to deferred credit | $ 96 | |||||
Otezla | Developed Technology Rights | ||||||
Business Acquisition [Line Items] | ||||||
Weighted average period of amortization | 8 years 6 months | |||||
Nuevolution | ||||||
Business Acquisition [Line Items] | ||||||
Consideration transferred | $ 183 | |||||
Fair value of liabilities assumed, deferred tax liabilities | 22 | |||||
Fair value of assets acquired and liabilities assumed, net other assets and liabilities | 29 | |||||
Goodwill | $ 26 | |||||
Nuevolution | R & D Technology rights | ||||||
Business Acquisition [Line Items] | ||||||
Weighted average period of amortization | 10 years | |||||
Finite-lived Intangible Assets Acquired | $ 150 | |||||
Kirin-Amgen, Inc. (K-A) | ||||||
Business Acquisition [Line Items] | ||||||
Consideration transferred | $ 657 | |||||
Percentage of voting interests acquired | 50.00% | |||||
Ownership interest in acquiree prior to acquisition (as a percent) | 50.00% | |||||
Net gain on remeasurement | $ 80 | |||||
Cash paid | 780 | |||||
Estimated fair values of contingent consideration obligations | 45 | |||||
Fair value of assets acquired, cash | 977 | |||||
Fair value of liabilities assumed, deferred tax liabilities | 102 | |||||
Fair value of assets acquired and liabilities assumed, net other assets and liabilities | 131 | |||||
Goodwill | $ 6 | |||||
Kirin-Amgen, Inc. (K-A) | Licensing rights | ||||||
Business Acquisition [Line Items] | ||||||
Weighted average period of amortization | 4 years | |||||
Fair value of assets acquired, licensing rights | $ 470 | |||||
Assembled Workforce [Member] | Otezla | Marketing-Related Rights | ||||||
Business Acquisition [Line Items] | ||||||
Weighted average period of amortization | 5 years | |||||
Inventories [Member] | Otezla | ||||||
Business Acquisition [Line Items] | ||||||
Acquired assets, weighted useful life | 2 years 6 months |
Acquisitions - Otezla (Details)
Acquisitions - Otezla (Details) - Otezla $ in Millions | Nov. 21, 2019USD ($) |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Assets [Abstract] | |
Cash purchase price | $ 13,400 |
Transaction costs | 40 |
Accumulated cost (consideration transferred) | 13,440 |
Intangible assets: | |
Inventory | 367 |
Deferred tax liability, net | (24) |
Deferred credit | (96) |
Other liabilities, net | (9) |
Total assets acquired, net | 13,440 |
Developed Technology Rights | |
Intangible assets: | |
Business acquired asset acquisition, Finite-lived intangible assets acquired | $ 13,007 |
Weighted average period of amortization | 8 years 6 months |
Marketing-Related Rights | |
Intangible assets: | |
Business acquired asset acquisition, Finite-lived intangible assets acquired | $ 195 |
Marketing-Related Rights | Assembled Workforce [Member] | |
Intangible assets: | |
Weighted average period of amortization | 5 years |
Acquisitions - Aggregate Consid
Acquisitions - Aggregate Consideration Paid (Details) - USD ($) $ in Millions | Jul. 15, 2019 | Mar. 31, 2018 |
Nuevolution | ||
Business Acquisition [Line Items] | ||
Total consideration transferred to acquire K-A | $ 183 | |
Kirin-Amgen, Inc. (K-A) | ||
Business Acquisition [Line Items] | ||
Total cash paid to Kirin | $ 780 | |
Fair value of contingent consideration obligation | 45 | |
Loss on settlement of preexisting relationship | (168) | |
Total consideration transferred to acquire K-A | 657 | |
Fair value of Amgen’s investment in K-A | 825 | |
Total acquisition date fair value | $ 1,482 | |
R & D Technology rights | Nuevolution | ||
Business Acquisition [Line Items] | ||
Weighted average period of amortization | 10 years |
Revenues - Narrative (Details)
Revenues - Narrative (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020USD ($) | Sep. 30, 2020USD ($) | Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2020USD ($)segmentcustomer | Dec. 31, 2019USD ($)customer | Dec. 31, 2018USD ($)customer | |
Revenue from Contract with Customer [Abstract] | |||||||||||
Number of operating segments | segment | 1 | ||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Number of major customers (as defined) accounting for more than 10% of total revenue | customer | 3 | 3 | 3 | ||||||||
Major customers (as defined) accounting for more than 10% of gross trade receivables | customer | 3 | 3 | |||||||||
Combined trade receivables for all major customers (as defined) as a percentage of net trade receivables | 74.00% | 73.00% | 74.00% | 73.00% | |||||||
Percentage of worldwide gross revenues derived from major customers (as defined) on a combined basis | 83.00% | ||||||||||
Total product sales | $ 25,424 | $ 23,362 | $ 23,747 | ||||||||
Percentage of net trade receivables due from customers located outside the United States, primarily in Europe | 28.00% | 27.00% | 28.00% | 27.00% | |||||||
US [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | $ 18,496 | $ 17,224 | 18,358 | ||||||||
ROW [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 6,928 | 6,138 | 5,389 | ||||||||
Product sales [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | $ 6,334 | $ 6,104 | $ 5,908 | $ 5,894 | $ 5,881 | $ 5,463 | $ 5,574 | $ 5,286 | 24,240 | 22,204 | 22,533 |
Product sales [Member] | US [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 17,985 | 16,531 | 17,429 | ||||||||
Product sales [Member] | ROW [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 6,255 | 5,673 | 5,104 | ||||||||
Enbrel® (etanercept) [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 4,996 | 5,226 | 5,014 | ||||||||
Enbrel® (etanercept) [Member] | US [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 4,855 | 5,050 | 4,807 | ||||||||
Enbrel® (etanercept) [Member] | ROW [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 141 | 176 | 207 | ||||||||
Prolia® (denosumab) [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 2,763 | 2,672 | 2,291 | ||||||||
Prolia® (denosumab) [Member] | US [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 1,830 | 1,772 | 1,500 | ||||||||
Prolia® (denosumab) [Member] | ROW [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 933 | 900 | 791 | ||||||||
Neulasta® (pegfilgrastim) [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 2,293 | 3,221 | 4,475 | ||||||||
Neulasta® (pegfilgrastim) [Member] | US [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 2,001 | 2,814 | 3,866 | ||||||||
Neulasta® (pegfilgrastim) [Member] | ROW [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 292 | 407 | 609 | ||||||||
Otezla [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 2,195 | 178 | 0 | ||||||||
Otezla [Member] | US [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 1,790 | 139 | 0 | ||||||||
Otezla [Member] | ROW [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 405 | 39 | 0 | ||||||||
XGEVA® (denosumab) [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 1,899 | 1,935 | 1,786 | ||||||||
XGEVA® (denosumab) [Member] | US [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 1,405 | 1,457 | 1,338 | ||||||||
XGEVA® (denosumab) [Member] | ROW [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 494 | 478 | 448 | ||||||||
Aranesp® (darbepoetin alfa) [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 1,568 | 1,729 | 1,877 | ||||||||
Aranesp® (darbepoetin alfa) [Member] | US [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 629 | 758 | 942 | ||||||||
Aranesp® (darbepoetin alfa) [Member] | ROW [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 939 | 971 | 935 | ||||||||
Kyprolis [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 1,065 | 1,044 | 968 | ||||||||
Kyprolis [Member] | US [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 710 | 654 | 583 | ||||||||
Kyprolis [Member] | ROW [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 355 | 390 | 385 | ||||||||
Repatha (evolocumab) [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 887 | 661 | 550 | ||||||||
Repatha (evolocumab) [Member] | US [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 459 | 376 | 358 | ||||||||
Repatha (evolocumab) [Member] | ROW [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 428 | 285 | 192 | ||||||||
Other products [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 6,574 | 5,538 | 5,572 | ||||||||
Other products [Member] | US [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 4,306 | 3,511 | 4,035 | ||||||||
Other products [Member] | ROW [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 2,268 | 2,027 | 1,537 | ||||||||
Other revenues [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 1,184 | 1,158 | 1,214 | ||||||||
Other revenues [Member] | US [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 511 | 693 | 929 | ||||||||
Other revenues [Member] | ROW [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 673 | 465 | 285 | ||||||||
AmerisourceBergen Corporation [Member] | Product sales [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 14,743 | 12,301 | 12,091 | ||||||||
McKesson Corporation [Member] | Product sales [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | 13,779 | 11,795 | 11,434 | ||||||||
Cardinal Health, Inc. [Member] | Product sales [Member] | |||||||||||
Revenue from External Customer [Line Items] | |||||||||||
Total product sales | $ 7,332 | $ 6,538 | $ 7,475 |
Revenues - Customer Concentrati
Revenues - Customer Concentration, Product Sales (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020USD ($) | Sep. 30, 2020USD ($) | Jun. 30, 2020USD ($) | Mar. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Dec. 31, 2020USD ($)customer | Dec. 31, 2019USD ($)customer | Dec. 31, 2018USD ($)customer | |
Revenue, Major Customer [Line Items] | |||||||||||
Product sales | $ 25,424 | $ 23,362 | $ 23,747 | ||||||||
Number of major customers (as defined) accounting for more than 10% of total revenue | customer | 3 | 3 | 3 | ||||||||
Major customers (as defined) accounting for more than 10% of gross trade receivables | customer | 3 | 3 | |||||||||
Product [Member] | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Product sales | $ 6,334 | $ 6,104 | $ 5,908 | $ 5,894 | $ 5,881 | $ 5,463 | $ 5,574 | $ 5,286 | $ 24,240 | $ 22,204 | $ 22,533 |
Product [Member] | AmerisourceBergen Corporation [Member] | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Product sales | $ 14,743 | $ 12,301 | $ 12,091 | ||||||||
Gross product sales to major customer (as defined) as a percentage of total gross revenues | 34.00% | 33.00% | 33.00% | ||||||||
Product [Member] | McKesson Corporation [Member] | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Product sales | $ 13,779 | $ 11,795 | $ 11,434 | ||||||||
Gross product sales to major customer (as defined) as a percentage of total gross revenues | 32.00% | 31.00% | 31.00% | ||||||||
Product [Member] | Cardinal Health, Inc. [Member] | |||||||||||
Revenue, Major Customer [Line Items] | |||||||||||
Product sales | $ 7,332 | $ 6,538 | $ 7,475 | ||||||||
Gross product sales to major customer (as defined) as a percentage of total gross revenues | 17.00% | 17.00% | 20.00% |
Stock-based compensation (Textu
Stock-based compensation (Textual) (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Amount by which the pool of available shares will be reduced for each stock option granted | 1 | ||
The amount of common stock available under the plan for future grants and/or issuances (in shares) | 23,000,000 | ||
Description of vesting of restricted stock units and stock options | RSUs and stock options generally vest in equal amounts on the second, third and fourth anniversaries of the grant date. | ||
Total unrecognized compensation cost related to nonvested awards | $ 345 | ||
Weighted average number of years over which compensation cost related to nonvested awards is expected to be recognized | 1 year 9 months 18 days | ||
Period over which the grants of equity instruments vest | 3 years | ||
Number of common shares issued for each performance unit earned | 1 | 1 | 1 |
RSUs [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
The number of shares by which the pool of available shares will be reduced for other types of awards granted | 1.9 | ||
Number of shares added back for tax withholding on full value awards | 1.9 | ||
Weighted average grant date fair value, granted (in usd per share) | $ 235.63 | $ 182.12 | $ 179.18 |
Total fair value of units that vested during the year | $ 161 | $ 160 | $ 167 |
Units outstanding (in shares) | 3,000,000 | 3,100,000 | |
Weighted-average grant date fair value | $ 198.11 | $ 174.97 | |
Units granted (in shares) | 1,100,000 | ||
Units, forfeited (in shares) | 200,000 | ||
Weighted average grant date fair value, forfeited (in usd per share) | $ 190.15 | ||
Stock options [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expiration period of stock options from date of grant | 10 years | ||
Total intrinsic value of stock options exercised during the year | $ 98 | $ 68 | 53 |
Actual tax benefits realized from tax deductions from option exercises | $ 21 | $ 15 | $ 12 |
Performance units [Member] | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
The number of shares by which the pool of available shares will be reduced for other types of awards granted | 1.9 | ||
Number of shares added back for tax withholding on full value awards | 1.9 | ||
Weighted average grant date fair value, granted (in usd per share) | $ 249.07 | $ 188.40 | $ 189.21 |
Total fair value of units that vested during the year | $ 230 | $ 176 | $ 133 |
Total unrecognized compensation cost related to nonvested awards | $ 127 | ||
Weighted average number of years over which compensation cost related to nonvested awards is expected to be recognized | 1 year | ||
Units outstanding (in shares) | 1,800,000 | 2,000,000 | |
Weighted-average grant date fair value | $ 207.52 | $ 185.64 | |
Units granted (in shares) | 600,000 | ||
Units, forfeited (in shares) | 100,000 | ||
Weighted average grant date fair value, forfeited (in usd per share) | $ 199.86 |
Stock-based compensation (Compo
Stock-based compensation (Components of Stock-based Compensation Expense) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Components of stock-based compensation expense [Abstract] | |||
Total stock-based compensation expense, pretax | $ 330 | $ 308 | $ 311 |
Tax benefit from stock-based compensation expense | (72) | (67) | (67) |
Total stock-based compensation expense, net of tax | 258 | 241 | 244 |
RSUs [Member] | |||
Components of stock-based compensation expense [Abstract] | |||
Total stock-based compensation expense, pretax | 178 | 168 | 165 |
Performance units [Member] | |||
Components of stock-based compensation expense [Abstract] | |||
Total stock-based compensation expense, pretax | 118 | 105 | 117 |
Stock options [Member] | |||
Components of stock-based compensation expense [Abstract] | |||
Total stock-based compensation expense, pretax | $ 34 | $ 35 | $ 29 |
Stock-based compensation (Summa
Stock-based compensation (Summary of RSUs) (Details) - RSUs [Member] - $ / shares shares in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Units | |||
Balance nonvested at beginning of period (in shares) | 3.1 | ||
Granted (in shares) | 1.1 | ||
Vested (in shares) | (1) | ||
Forfeited (in shares) | (0.2) | ||
Balance nonvested at end of period (in shares) | 3 | 3.1 | |
Weighted-average grant date fair value | |||
Balance nonvested at beginning of period (in usd per share) | $ 174.97 | ||
Granted (in usd per share) | 235.63 | $ 182.12 | $ 179.18 |
Vested (in usd per share) | 167.23 | ||
Forfeited (in usd per share) | 190.15 | ||
Balance nonvested at end of period (in usd per share) | $ 198.11 | $ 174.97 |
Stock-based compensation Stock-
Stock-based compensation Stock-based compensation (Summary of Stock Options) (Details) - Share-based Payment Arrangement, Option [Member] - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Closing price of our common stock on grant date (in usd per share) | $ 236.36 | $ 177.31 | $ 177.46 |
Volatility | 28.10% | 23.50% | 24.60% |
Expected life (in years) | 5 years 9 months 18 days | 5 years 9 months 18 days | 5 years 9 months 18 days |
Risk-free interest rate | 0.40% | 2.40% | 2.80% |
Expected dividend yield | 3.00% | 3.10% | 2.90% |
Granted (in usd per share) | $ 42.34 | $ 30.47 | $ 34.60 |
Stock-based compensation (Sum_2
Stock-based compensation (Summary of Stock Options) (Details) - Stock options [Member] $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended |
Dec. 31, 2020USD ($)$ / sharesshares | |
Options | |
Balance unexercised at beginning of period (in shares) | shares | 4.8 |
Granted (in shares) | shares | 1 |
Exercised (in shares) | shares | (0.9) |
Expired/forfeited (in shares) | shares | (0.2) |
Balance unexercised at end of period (in shares) | shares | 4.7 |
Vested or expected to vest (in shares) | shares | 4.5 |
Exercisable (in shares) | shares | 1.5 |
Weighted- average exercise price | |
Balance unexercised at beginning of period (in usd per share) | $ / shares | $ 157 |
Granted (in usd per share) | $ / shares | 236.36 |
Exercised (in usd per share) | $ / shares | 117.90 |
Expired/forfeited (in usd per share) | $ / shares | 178.36 |
Balance unexercised at end of period (in shares) | $ / shares | 179.90 |
Weighted-average exercise price, vested or expected to vest (in usd per share) | $ / shares | 178.37 |
Weighted-average exercise price, exercisable (in usd per share) | $ / shares | $ 150.80 |
Stock options information [Abstract] | |
Weighted-average remaining contractual life (years), unexercised | 7 years 3 months 18 days |
Weighted-average remaining contractual life (years), vested or expected to vest | 7 years 3 months 18 days |
Weighted-average remaining contractual life (years), exercisable | 5 years 6 months |
Aggregate intrinsic value, unexercised | $ | $ 243 |
Aggregate intrinsic value, vested or expected to vest | $ | 239 |
Aggregate intrinsic value, exercisable | $ | $ 120 |
Stock-based compensation (Weigh
Stock-based compensation (Weighted-average Assumptions) (Details) - Performance units [Member] - $ / shares | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Weighted-average assumptions and resulting weighted-average grant date fair values [Abstract] | |||
Closing price of our common stock on grant date (in usd per share) | $ 236.36 | $ 177.31 | $ 177.93 |
Volatility | 27.50% | 22.10% | 23.80% |
Risk-free interest rate | 0.20% | 2.30% | 2.60% |
Fair value of unit (in usd per share) | $ 249.07 | $ 188.40 | $ 189.21 |
Defined contribution plan (Deta
Defined contribution plan (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Retirement Benefits [Abstract] | |||
Expense attributed to Retirement and Savings Plan | $ 231 | $ 220 | $ 173 |
Income taxes (Income Before Inc
Income taxes (Income Before Income Taxes) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Examination [Line Items] | |||
Income before income taxes | $ 8,133 | $ 9,138 | $ 9,545 |
Domestic [Member] | |||
Income Tax Examination [Line Items] | |||
Income before income taxes | 4,087 | 4,371 | 4,856 |
Foreign [Member] | |||
Income Tax Examination [Line Items] | |||
Income before income taxes | $ 4,046 | $ 4,767 | $ 4,689 |
Income taxes (Provision for Inc
Income taxes (Provision for Income Taxes) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Current provision: | |||
Federal | $ 921 | $ 1,284 | $ 1,270 |
State | 34 | 39 | 17 |
Foreign | 277 | 277 | 227 |
Total current provision | 1,232 | 1,600 | 1,514 |
Deferred (benefit) provision: | |||
Federal | (321) | (276) | (317) |
State | 9 | (22) | (7) |
Foreign | (51) | (6) | (39) |
Total deferred benefit | (363) | (304) | (363) |
Total provision for income taxes | $ 869 | $ 1,296 | $ 1,151 |
Income taxes (Components of Def
Income taxes (Components of Deferred Tax Assets and Liabilities) (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred income tax assets: | ||
NOL and credit carryforwards | $ 794 | $ 800 |
Accrued expenses | 561 | 457 |
Expenses capitalized for tax | 144 | 170 |
Stock-based compensation | 92 | 91 |
Other | 301 | 269 |
Total deferred income tax assets | 1,892 | 1,787 |
Valuation allowance | (571) | (517) |
Net deferred income tax assets | 1,321 | 1,270 |
Deferred income tax liabilities: | ||
Acquired intangible assets | (903) | (1,288) |
Debt | (282) | (210) |
Deferred Tax Liabilities, Property, Plant and Equipment | (148) | (53) |
Other | (189) | (233) |
Total deferred income tax liabilities | (1,522) | (1,784) |
Total deferred income taxes, net | $ (201) | $ (514) |
Income taxes (Textual) (Details
Income taxes (Textual) (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Tax Credit Carryforward [Line Items] | |||
Interest and penalties related to unrecognized tax benefits recognized in income tax provision | $ 116,000,000 | $ 198,000,000 | $ 137,000,000 |
Accrued interest and penalties associated with unrecognized tax benefits | 783,000,000 | 667,000,000 | |
Income taxes paid | 1,400,000,000 | $ 1,900,000,000 | $ 1,900,000,000 |
Federal [Member] | |||
Tax Credit Carryforward [Line Items] | |||
Tax credit carryforwards available to reduce income taxes | 20,000,000 | ||
NOL carryforwards available to reduce income taxes | 143,000,000 | ||
NOL carryforwards, valuation allowance | 6,000,000 | ||
Federal [Member] | Operating Losses That Expire Between 2021 and 2035 [Member] | |||
Tax Credit Carryforward [Line Items] | |||
NOL carryforwards, valuation allowance | 0 | ||
Federal [Member] | Expiration in tax years between 2023 and 2035 [Member] | |||
Tax Credit Carryforward [Line Items] | |||
Tax credit carryforwards, valuation allowance | 0 | ||
State [Member] | |||
Tax Credit Carryforward [Line Items] | |||
Tax credit carryforwards available to reduce income taxes | 681,000,000 | ||
Tax credit carryforwards, valuation allowance | 585,000,000 | ||
NOL carryforwards available to reduce income taxes | 167,000,000 | ||
Foreign [Member] | |||
Tax Credit Carryforward [Line Items] | |||
NOL carryforwards available to reduce income taxes | 1,900,000,000 | ||
NOL carryforwards, valuation allowance | 754,000,000 | ||
NOLs with no valuation allowance and no expiration | 861,000,000 | ||
Foreign [Member] | Operating Losses That Expire Between 2021 and 2030 [Member] | |||
Tax Credit Carryforward [Line Items] | |||
NOL carryforwards, valuation allowance | $ 0 |
Income taxes (Reconciliation of
Income taxes (Reconciliation of Total Gross Amounts of UTBs) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Reconciliation of total gross amounts of unrecognized tax benefits (excluding interest, penalties, foreign tax credits and the federal tax benefit of state taxes related to unrecognized tax benefits) | |||
Beginning balance | $ 3,287 | $ 3,061 | $ 2,953 |
Additions based on tax positions related to the current year | 165 | 215 | 173 |
Additions based on tax positions related to prior years | 3 | 22 | 13 |
Reductions for tax positions of prior years | (35) | (11) | (17) |
Settlements | (68) | 0 | (61) |
Ending balance | $ 3,352 | $ 3,287 | $ 3,061 |
Income taxes (Reconciliation _2
Income taxes (Reconciliation of Federal Statutory Tax Rate) (Details) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Federal statutory tax rate | 21.00% | 21.00% | 21.00% |
Foreign earnings | (4.70%) | (4.50%) | (4.30%) |
Foreign-derived intangible income | (0.70%) | (0.70%) | (0.40%) |
Credits, Puerto Rico Excise Tax | (2.90%) | (2.60%) | (2.50%) |
2017 Tax Act, net impact on intercompany sales | 0.00% | 0.00% | (1.80%) |
Interest on uncertain tax positions | 1.10% | 1.60% | 1.20% |
Credits, primarily federal R&D | (1.40%) | (1.00%) | (0.80%) |
Audit settlements | (1.00%) | 0.00% | (0.30%) |
Other, net | (0.70%) | 0.40% | 0.00% |
Effective tax rate | 10.70% | 14.20% | 12.10% |
Earnings per share (Details)
Earnings per share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Income (Numerator): | |||||||||||
Net income for basic and diluted EPS | $ 1,615 | $ 2,021 | $ 1,803 | $ 1,825 | $ 1,703 | $ 1,968 | $ 2,179 | $ 1,992 | $ 7,264 | $ 7,842 | $ 8,394 |
Shares (Denominator): | |||||||||||
Weighted-average shares for basic EPS | 586 | 605 | 661 | ||||||||
Effect of dilutive securities (in shares) | 4 | 4 | 4 | ||||||||
Weighted-average shares for diluted EPS | 590 | 609 | 665 | ||||||||
Basic EPS (in usd per share) | $ 2.78 | $ 3.45 | $ 3.07 | $ 3.09 | $ 2.87 | $ 3.29 | $ 3.59 | $ 3.20 | $ 12.40 | $ 12.96 | $ 12.70 |
Diluted EPS (in usd per share) | $ 2.76 | $ 3.43 | $ 3.05 | $ 3.07 | $ 2.85 | $ 3.27 | $ 3.57 | $ 3.18 | $ 12.31 | $ 12.88 | $ 12.62 |
Collaborations - Novartis AG (D
Collaborations - Novartis AG (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Revenues | $ 25,424 | $ 23,362 | $ 23,747 |
Collaborative Arrangement with Novartis AG [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Potential future milestone payment | 100 | ||
Collaborative Arrangement with Novartis AG [Member] | Other revenues [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Revenues | 295 | ||
Collaborative Arrangement with Novartis AG [Member] | Selling, general and administrative [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Cost paid | 44 | ||
Cost recoveries | 192 | 187 | |
Collaborative Arrangement with Novartis AG [Member] | Cost of sales [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Royalties due | $ 139 | $ 115 | $ 43 |
Collaborations - Bayer HealthCa
Collaborations - Bayer HealthCare Pharmaceuticals Inc. (Details) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020USD ($)country | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Revenues | $ 25,424 | $ 23,362 | $ 23,747 |
US [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Revenues | $ 18,496 | 17,224 | 18,358 |
Collaborative Arrangement with Bayer [Member] | Nexavar [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Number of countries product is marketed and sold | country | 100 | ||
Collaborative Arrangement with Bayer [Member] | Nexavar [Member] | US [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Collaboration, royalty percentage | 30.00% | ||
Collaborative Arrangement with Bayer [Member] | Nexavar [Member] | NonUs,ExcludingJapan [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Collaboration, royalty percentage | 30.00% | ||
Collaborative Arrangement with Bayer [Member] | Nexavar [Member] | Other revenues [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Collaboration profit | 210 | 164 | |
Collaborative Arrangement with Bayer [Member] | Royalty [Member] | Other revenues [Member] | |||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | |||
Revenues | $ 217 | $ 79 | $ 91 |
Collaborations - BeiGene (Detai
Collaborations - BeiGene (Details) - USD ($) | Jan. 02, 2020 | Dec. 31, 2020 |
BeiGene | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Ownership percentage | 20.50% | 20.50% |
Equity Method Investment, Aggregate Cost | $ 2,800,000,000 | |
BeiGene | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Research and Development Arrangement, Contract to Perform for Others, Costs Incurred, Gross | $ 1,250,000,000 | |
BeiGene | Other current assets [Member] | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Recovery Of Direct Costs, Receivable | $ 113,000,000 | |
BeiGene | Research and Development Expense [Member] | ||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||
Cost recoveries | $ 225,000,000 |
Investments - Schedule (Details
Investments - Schedule (Details) - USD ($) | Dec. 31, 2020 | Dec. 31, 2019 |
Debt securities | ||
Amortized cost | $ 9,844,000,000 | $ 8,206,000,000 |
Gross unrealized gains | 1,000,000 | 28,000,000 |
Gross unrealized losses | 0 | 0 |
Fair values | 9,845,000,000 | 8,234,000,000 |
U.S. Treasury notes [Member] | ||
Debt securities | ||
Amortized cost | 129,000,000 | 359,000,000 |
Gross unrealized gains | 1,000,000 | 1,000,000 |
Gross unrealized losses | 0 | 0 |
Fair values | 130,000,000 | 360,000,000 |
U.S. Treasury bills [Member] | ||
Debt securities | ||
Amortized cost | 4,948,000,000 | 0 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | 0 | 0 |
Fair values | 4,948,000,000 | 0 |
Corporate debt securities - Financial [Member] | ||
Debt securities | ||
Amortized cost | 0 | 1,108,000,000 |
Gross unrealized gains | 0 | 13,000,000 |
Gross unrealized losses | 0 | 0 |
Fair values | 0 | 1,121,000,000 |
Corporate debt securities - Industrial [Member] | ||
Debt securities | ||
Amortized cost | 0 | 824,000,000 |
Gross unrealized gains | 0 | 10,000,000 |
Gross unrealized losses | 0 | 0 |
Fair values | 0 | 834,000,000 |
Corporate debt securities - Other [Member] | ||
Debt securities | ||
Amortized cost | 0 | 195,000,000 |
Gross unrealized gains | 0 | 3,000,000 |
Gross unrealized losses | 0 | 0 |
Fair values | 0 | 198,000,000 |
Residential mortgage-backed securities [Member] | ||
Debt securities | ||
Amortized cost | 0 | 181,000,000 |
Gross unrealized gains | 0 | 1,000,000 |
Gross unrealized losses | 0 | 0 |
Fair values | 0 | 182,000,000 |
Money market mutual funds [Member] | ||
Debt securities | ||
Amortized cost | 4,765,000,000 | 5,250,000,000 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | 0 | 0 |
Fair values | 4,765,000,000 | 5,250,000,000 |
Other short-term interest-bearing securities [Member] | ||
Debt securities | ||
Amortized cost | 2,000,000 | 289,000,000 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | 0 | 0 |
Fair values | $ 2,000,000 | $ 289,000,000 |
Investments - Fair Values by Cl
Investments - Fair Values by Classification (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Consolidated Balance Sheets locations | ||
Marketable securities | $ 4,381 | $ 2,874 |
Total available-for-sale investments | 9,845 | 8,234 |
Available-for-sale investments [Member] | ||
Consolidated Balance Sheets locations | ||
Cash and cash equivalents | 5,464 | 5,360 |
Marketable securities | 4,381 | 2,874 |
Total available-for-sale investments | $ 9,845 | $ 8,234 |
Investments - Available-for-sal
Investments - Available-for-sale (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |||
Cash | $ 802 | $ 677 | |
Total realized gains | 37 | 92 | $ 29 |
Total realized losses | $ 4 | $ 36 | $ 394 |
Investments - Fair Values by Co
Investments - Fair Values by Contractual Maturity (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Investments, Debt and Equity Securities [Abstract] | ||
Maturing in one year or less | $ 9,795 | $ 5,629 |
Maturing after one year through three years | 50 | 2,304 |
Maturing after three years through five years | 0 | 119 |
Residential-mortgage-backed securities | 0 | 182 |
Total available-for-sale investments | $ 9,845 | $ 8,234 |
Investments - Equity Securities
Investments - Equity Securities (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Investments, Debt and Equity Securities [Abstract] | |||
Equity securities | $ 477 | $ 303 | |
Equity Securities, FV-NI, Unrealized Gain (Loss) | 174 | 112 | $ (24) |
Equity securities without readily determinable fair value | $ 203 | $ 176 |
Investments - Limited Partnersh
Investments - Limited Partnership Investments (Details) - Limited Partnership [Member] - Fair Value Measured at Net Asset Value Per Share [Member] - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Net Investment Income [Line Items] | |||
Investments | $ 496 | $ 320 | |
Alternative Investment, Net Gain (Loss) | $ 241 | $ 27 | $ 91 |
Investments - BeiGene (Details)
Investments - BeiGene (Details) - BeiGene - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Jan. 02, 2020 | |
Net Investment Income [Line Items] | ||
Ownership percentage | 20.50% | 20.50% |
Equity Method Investment, Aggregate Cost | $ 2,800 | |
Equity Method Investment, Quoted Market Value | $ 4,900 | 2,600 |
Equity Method Investment, Difference Between Carrying Amount and Underlying Equity | $ 2,400 | |
Equity method investment, change in carrying value | 569 | |
Equity Method Investment, Change In Carrying Value, Other | 34 | |
Company's share of profits (losses) of related party | (229) | |
Equity Method Investment, Amortization of Difference Between Carrying Amount and Underlying Equity | 109 | |
Approximate carrying value of the company's equity method investment | $ 2,900 | |
Minimum [Member] | ||
Net Investment Income [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 8 years | |
Maximum [Member] | ||
Net Investment Income [Line Items] | ||
Finite-Lived Intangible Asset, Useful Life | 15 years |
Inventories (Details)
Inventories (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 486 | $ 358 |
Work in process | 2,437 | 2,227 |
Finished goods | 970 | 999 |
Total inventories | $ 3,893 | $ 3,584 |
Property, plant and equipment_2
Property, plant and equipment (Schedule) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Property, Plant and Equipment [Line Items] | |||
Land | $ 259 | $ 263 | |
Buildings and improvements | 3,857 | 3,757 | |
Manufacturing equipment | 2,865 | 2,655 | |
Laboratory equipment | 1,257 | 1,236 | |
Fixed equipment | 2,406 | 2,338 | |
Capitalized software | 1,216 | 1,154 | |
Other | 1,091 | 975 | |
Construction in progress | 915 | 907 | |
Property, plant and equipment, gross | 13,866 | 13,285 | |
Less accumulated depreciation and amortization | (8,977) | (8,357) | |
Property, plant and equipment, net | 4,889 | 4,928 | |
Depreciation and amortization charges associated with property, plant and equipment | $ 640 | $ 635 | $ 630 |
Buildings and improvements [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 10 years | ||
Buildings and improvements [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 40 years | ||
Manufacturing equipment [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 8 years | ||
Manufacturing equipment [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 12 years | ||
Laboratory equipment [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 8 years | ||
Laboratory equipment [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 12 years | ||
Fixed equipment [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 12 years | ||
Capitalized software [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 3 years | ||
Capitalized software [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 5 years | ||
Other [Member] | Minimum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 5 years | ||
Other [Member] | Maximum [Member] | |||
Property, Plant and Equipment [Line Items] | |||
Useful life (in years) | 10 years |
Property, plant and equipment_3
Property, plant and equipment (Geographic Information) (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, net | $ 4,889 | $ 4,928 |
US [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, net | 2,473 | 2,433 |
Puerto Rico [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, net | 1,331 | 1,402 |
ROW [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Property, plant and equipment, net | $ 1,085 | $ 1,093 |
Goodwill and other intangible_2
Goodwill and other intangible assets - Goodwill Roll Forward (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Goodwill [Roll Forward] | ||
Beginning balance | $ 14,703 | $ 14,699 |
Addition from acquisitions | 0 | 26 |
Currency translation adjustments | (14) | (22) |
Ending balance | $ 14,689 | $ 14,703 |
Goodwill and other intangible_3
Goodwill and other intangible assets - Identifiable Intangible Assets (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Finite-lived intangible assets: | ||
Gross carrying amounts | $ 32,018 | $ 31,991 |
Accumulated amortization | (15,461) | (12,632) |
Other intangible assets, net | 16,557 | 19,359 |
Indefinite-lived intangible assets: | ||
Identifiable intangible assets | 32,048 | 32,045 |
Accumulated amortization | (15,461) | (12,632) |
Identifiable intangible assets, net | 16,587 | 19,413 |
IPR&D [Member] | ||
Indefinite-lived intangible assets: | ||
Indefinite-lived intangible assets | 30 | 54 |
Developed Technology Rights | ||
Finite-lived intangible assets: | ||
Gross carrying amounts | 25,591 | 25,575 |
Accumulated amortization | (10,564) | (8,322) |
Other intangible assets, net | 15,027 | 17,253 |
Licensing rights | ||
Finite-lived intangible assets: | ||
Gross carrying amounts | 3,743 | 3,761 |
Accumulated amortization | (2,791) | (2,398) |
Other intangible assets, net | 952 | 1,363 |
Marketing-related rights [Member] | ||
Finite-lived intangible assets: | ||
Gross carrying amounts | 1,367 | 1,382 |
Accumulated amortization | (1,041) | (965) |
Other intangible assets, net | 326 | 417 |
R&D technology rights [Member] | ||
Finite-lived intangible assets: | ||
Gross carrying amounts | 1,317 | 1,273 |
Accumulated amortization | (1,065) | (947) |
Other intangible assets, net | $ 252 | $ 326 |
Goodwill and other intangible_4
Goodwill and other intangible assets - Narrative (Details) - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Amortization charges associated with finite-lived intangible assets | $ 2.8 | $ 1.4 | $ 1.3 |
Total estimated amortization of finite-lived intangible assets for 2021 | 2.6 | ||
Total estimated amortization of finite-lived intangible assets for 2022 | 2.5 | ||
Total estimated amortization of finite-lived intangible assets for 2023 | 2.4 | ||
Total estimated amortization of finite-lived intangible assets for 2024 | 2.4 | ||
Total estimated amortization of finite-lived intangible assets for 2025 | $ 2.2 |
Leases - Narrative (Details)
Leases - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | |
Lessee, Lease, Description [Line Items] | |||
Renewal term | 7 years | ||
Weighted-average remaining lease term (in years) | 3 years 8 months 12 days | 4 years 1 month 6 days | |
Weighted-average discount rate | 3.10% | 3.30% | |
Total undiscounted future lease payment | $ 339 | ||
Total lease payments | $ 488 | ||
Operating lease rent expense | $ 166 | ||
Minimum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Leases not yet commenced lease term | 30 months | ||
Maximum [Member] | |||
Lessee, Lease, Description [Line Items] | |||
Leases not yet commenced lease term | 15 years |
Leases - Summary of Leases (Det
Leases - Summary of Leases (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Assets: | ||
Other assets | $ 408 | $ 469 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | us-gaap:AccountsPayableAndAccruedLiabilitiesCurrent | us-gaap:AccountsPayableAndAccruedLiabilitiesCurrent |
Liabilities: | ||
Accrued liabilities | $ 153 | $ 140 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | us-gaap:OtherLiabilitiesNoncurrent | us-gaap:OtherLiabilitiesNoncurrent |
Other noncurrent liabilities | $ 306 | $ 388 |
Total lease liabilities | $ 459 | $ 528 |
Leases - Components of Lease Co
Leases - Components of Lease Costs (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||
Operating | $ 223 | $ 204 |
Sublease income | (34) | (33) |
Total net lease costs | $ 189 | $ 171 |
Leases - Maturities of Lease Li
Leases - Maturities of Lease Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Lessee, Lease, Description [Line Items] | ||
2021 | $ 164 | |
2022 | 132 | |
2023 | 105 | |
2024 | 36 | |
2025 | 15 | |
Thereafter | 36 | |
Total lease payments | 488 | |
Less imputed interest | (29) | |
Present value of lease liabilities | 459 | $ 528 |
Abandoned Leases [Member] | ||
Lessee, Lease, Description [Line Items] | ||
Future rental commitments for abandoned leases | 133 | |
Expected total future rental income to be received | $ 107 |
Leases - Cash and Noncash Infor
Leases - Cash and Noncash Information of Leases (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2020 | Dec. 31, 2019 | |
Leases [Abstract] | ||
Cash paid for amounts included in the measurement of lease liabilities | $ 177 | $ 148 |
ROU assets obtained in exchange for lease obligations | $ 101 | $ 163 |
Other current assets and accr_3
Other current assets and accrued liabilities - Schedule of Other Assets (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Payables and Accruals [Abstract] | ||
Prepaid expenses | $ 1,156 | $ 939 |
Corporate partner receivables | 583 | 485 |
Tax receivables | 216 | 186 |
Other | 124 | 278 |
Total other current assets | $ 2,079 | $ 1,888 |
Other current assets and accr_4
Other current assets and accrued liabilities - Schedule of Accrued Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Payables and Accruals [Abstract] | ||
Sales deductions | $ 4,801 | $ 3,880 |
Employee compensation and benefits | 1,098 | 981 |
Dividends payable | 1,018 | 946 |
Income taxes payable | 828 | 557 |
Sales returns reserve | 474 | 564 |
Other | 1,922 | 1,583 |
Total accrued liabilities | $ 10,141 | $ 8,511 |
Financing arrangements (Princip
Financing arrangements (Principal Amounts and Carrying Value of Long-term Borrowings) (Details) $ in Millions | 12 Months Ended | ||||||
Dec. 31, 2020USD ($) | Dec. 31, 2020EUR (€) | Dec. 31, 2020CHF (SFr) | Dec. 31, 2020GBP (£) | May 31, 2020USD ($) | Feb. 29, 2020USD ($) | Dec. 31, 2019USD ($) | |
Carrying values of long-term borrowings | |||||||
Unamortized bond discounts, premiums and issuance costs, net | $ (1,188) | $ (868) | |||||
Fair value adjustments | 566 | 296 | |||||
Other Long-term Debt | 5 | 0 | |||||
Total carrying value of debt | 32,986 | 29,903 | |||||
Less current portion | (91) | (2,953) | |||||
Total long-term debt | $ 32,895 | 26,950 | |||||
0.41% 2023 Swiss franc Bonds [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 0.41% | 0.41% | 0.41% | 0.41% | |||
Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Face amount | $ 4,000 | $ 5,000 | |||||
Notes [Member] | 4.50% notes due 2020 (4.50% 2020 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 4.50% | 4.50% | 4.50% | 4.50% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | 300 | ||||||
Notes [Member] | 2.125% notes due 2020 (2.125% 2020 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 2.125% | 2.125% | 2.125% | 2.125% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 0 | 750 | |||||
Notes [Member] | Floating Rate Notes Due 2020 [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 0 | 300 | |||||
Notes [Member] | 2.20% notes due 2020 (2.20% 2020 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 2.20% | 2.20% | 2.20% | 2.20% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 0 | 700 | |||||
Notes [Member] | 3.45% notes due 2020 (3.45% 2020 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 3.45% | 3.45% | 3.45% | 3.45% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | 900 | ||||||
Notes [Member] | 4.10% notes due 2021 (4.10% 2021 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 4.10% | 4.10% | 4.10% | 4.10% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | 1,000 | ||||||
Notes [Member] | 1.85% notes due 2021 (1.85% 2021 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 1.85% | 1.85% | 1.85% | 1.85% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 0 | 750 | |||||
Notes [Member] | 3.875% notes due 2021 (3.875% 2021 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 3.875% | 3.875% | 3.875% | 3.875% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | 1,750 | ||||||
Notes [Member] | 1.25% notes due 2022 (1.25% 2022 euro Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 1.25% | 1.25% | 1.25% | 1.25% | |||
Face amount | € | € 1,250,000,000 | ||||||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 1,527 | 1,402 | |||||
Notes [Member] | 2.70% notes due 2022 (2.70% 2022 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 2.70% | 2.70% | 2.70% | 2.70% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 500 | 500 | |||||
Notes [Member] | 2.65% notes due 2022 (2.65% 2022 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 2.65% | 2.65% | 2.65% | 2.65% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 1,500 | 1,500 | |||||
Notes [Member] | 3.625% notes due 2022 (3.625% 2022 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 3.625% | 3.625% | 3.625% | 3.625% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 750 | 750 | |||||
Notes [Member] | 0.41% 2023 Swiss franc Bonds [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 0.41% | 0.41% | 0.41% | 0.41% | |||
Face amount | SFr | SFr 700,000,000 | ||||||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 791 | 725 | |||||
Notes [Member] | 2.25% notes due 2023 (2.25% 2023 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 2.25% | 2.25% | 2.25% | 2.25% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 750 | 750 | |||||
Notes [Member] | 3.625% notes due 2024 (3.625% 2024 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 3.625% | 3.625% | 3.625% | 3.625% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 1,400 | 1,400 | |||||
Notes [Member] | 1.90% notes due 2025 (1.90% 2025 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 1.90% | 1.90% | 1.90% | 1.90% | 1.90% | ||
Face amount | $ 500 | ||||||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 500 | ||||||
Notes [Member] | 3.125% notes due 2025 (3.125% 2025 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 3.125% | 3.125% | 3.125% | 3.125% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 1,000 | 1,000 | |||||
Notes [Member] | 2.00% 2026 euro Notes [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 2.00% | 2.00% | 2.00% | 2.00% | |||
Face amount | € | € 750,000,000 | ||||||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 916 | 841 | |||||
Notes [Member] | 2.60% notes due 2026 (2.60% 2026 notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 2.60% | 2.60% | 2.60% | 2.60% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 1,250 | 1,250 | |||||
Notes [Member] | 5.50% pound-sterling-denominated notes due 2026 (5.50% 2026 pound sterling Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 5.50% | 5.50% | 5.50% | 5.50% | |||
Face amount | £ | £ 475,000,000 | ||||||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 649 | 630 | |||||
Notes [Member] | 2.20% notes due 2027 (2.20% 2027 notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 2.20% | 2.20% | 2.20% | 2.20% | 2.20% | 2.20% | |
Face amount | $ 1,000 | $ 750 | |||||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 1,750 | ||||||
Notes [Member] | 3.20% notes due 2027 (3.20% 2027 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 3.20% | 3.20% | 3.20% | 3.20% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 1,000 | 1,000 | |||||
Notes [Member] | 4.00% pound-sterling-denominated notes due 2029 (4.00% 2029 pound sterling Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 4.00% | 4.00% | 4.00% | 4.00% | |||
Face amount | £ | £ 700,000,000 | ||||||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 957 | 928 | |||||
Notes [Member] | 2.45% notes due 2031 (2.45% 2031 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 2.45% | 2.45% | 2.45% | 2.45% | 2.45% | ||
Face amount | $ 1,250 | ||||||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 1,250 | ||||||
Notes [Member] | 2.30% notes due 2031 (2.30% 2031 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 2.30% | 2.30% | 2.30% | 2.30% | 2.30% | ||
Face amount | $ 1,250 | ||||||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 1,250 | ||||||
Notes [Member] | 6.375% notes due 2037 (6.375% 2037 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 6.375% | 6.375% | 6.375% | 6.375% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 478 | 552 | |||||
Notes [Member] | 6.90% notes due 2038 (6.90% 2038 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 6.90% | 6.90% | 6.90% | 6.90% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 254 | 291 | |||||
Notes [Member] | 6.40% notes due 2039 (6.40% 2039 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 6.40% | 6.40% | 6.40% | 6.40% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 333 | 466 | |||||
Notes [Member] | 3.15% notes due 2040 (3.15% 2040 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 3.15% | 3.15% | 3.15% | 3.15% | 3.15% | 3.15% | |
Face amount | $ 750 | $ 1,250 | |||||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 2,000 | ||||||
Notes [Member] | 5.75% notes due 2040 (5.75% 2040 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 5.75% | 5.75% | 5.75% | 5.75% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 373 | 412 | |||||
Notes [Member] | 4.95% notes due 2041 (4.95% 2041 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 4.95% | 4.95% | 4.95% | 4.95% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 600 | 600 | |||||
Notes [Member] | 5.15% notes due 2041 (5.15% 2041 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 5.15% | 5.15% | 5.15% | 5.15% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 729 | 974 | |||||
Notes [Member] | 5.65% notes due 2042 (5.65% 2042 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 5.65% | 5.65% | 5.65% | 5.65% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 415 | 487 | |||||
Notes [Member] | 5.375% notes due 2043 (5.375% 2043 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 5.375% | 5.375% | 5.375% | 5.375% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 185 | 261 | |||||
Notes [Member] | 4.40% notes due 2045 (4.40% 2045 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 4.40% | 4.40% | 4.40% | 4.40% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 2,250 | 2,250 | |||||
Notes [Member] | 4.563% notes due 2048 (4.563% 2048 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 4.563% | 4.563% | 4.563% | 4.563% | |||
Effective interest rate on note | 6.30% | 6.30% | 6.30% | 6.30% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 1,415 | 1,415 | |||||
Notes [Member] | Three Point Three Seven Five Percent Notes Due 2050 [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 3.375% | 3.375% | 3.375% | 3.375% | 3.375% | 3.375% | |
Face amount | $ 1,000 | $ 1,250 | |||||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 2,250 | ||||||
Notes [Member] | 4.663% notes due 2051 (4.663% 2051 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 4.663% | 4.663% | 4.663% | 4.663% | |||
Effective interest rate on note | 5.60% | 5.60% | 5.60% | 5.60% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 3,541 | 3,541 | |||||
Notes [Member] | 2.77% notes due 2053 (2.77% 2053 Notes) [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Interest rate, stated percentage | 2.77% | 2.77% | 2.77% | 2.77% | |||
Face amount | $ 940 | ||||||
Effective interest rate on note | 5.20% | 5.20% | 5.20% | 5.20% | |||
Percentage of principal amount of notes that may be paid upon occurrence of change in control triggering event | 101.00% | ||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 940 | 0 | |||||
Notes [Member] | Other notes due 2097 [Member] | |||||||
Carrying values of long-term borrowings | |||||||
Long-term debt, gross | $ 100 | $ 100 | |||||
Debt securities payable [Member] | Minimum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Redemption period without payment of make whole amount | 1 month | ||||||
Debt securities payable [Member] | Maximum [Member] | |||||||
Debt Instrument [Line Items] | |||||||
Redemption period without payment of make whole amount | 6 months |
Financing arrangements (Debt Is
Financing arrangements (Debt Issuances) (Details) - USD ($) | Dec. 31, 2020 | May 31, 2020 | Feb. 29, 2020 |
Debt Instrument [Line Items] | |||
Commercial paper, maximum borrowing capacity | $ 2,500,000,000 | ||
Notes [Member] | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount of notes issued | $ 4,000,000,000 | $ 5,000,000,000 | |
Notes [Member] | 1.90% notes due 2025 (1.90% 2025 Notes) [Member] | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount of notes issued | $ 500,000,000 | ||
Interest rate, stated percentage | 1.90% | 1.90% | |
Notes [Member] | 2.20% notes due 2027 (2.20% 2027 notes) [Member] | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount of notes issued | $ 1,000,000,000 | $ 750,000,000 | |
Interest rate, stated percentage | 2.20% | 2.20% | 2.20% |
Notes [Member] | 2.45% notes due 2031 (2.45% 2031 Notes) [Member] | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount of notes issued | $ 1,250,000,000 | ||
Interest rate, stated percentage | 2.45% | 2.45% | |
Notes [Member] | 3.15% notes due 2040 (3.15% 2040 Notes) [Member] | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount of notes issued | $ 750,000,000 | $ 1,250,000,000 | |
Interest rate, stated percentage | 3.15% | 3.15% | 3.15% |
Notes [Member] | Three Point Three Seven Five Percent Notes Due 2050 [Member] | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount of notes issued | $ 1,000,000,000 | $ 1,250,000,000 | |
Interest rate, stated percentage | 3.375% | 3.375% | 3.375% |
Notes [Member] | 2.30% notes due 2031 (2.30% 2031 Notes) [Member] | |||
Debt Instrument [Line Items] | |||
Aggregate principal amount of notes issued | $ 1,250,000,000 | ||
Interest rate, stated percentage | 2.30% | 2.30% |
Financing arrangements (Debt Re
Financing arrangements (Debt Repayments) (Details) € in Millions, $ in Millions | 12 Months Ended | ||||
Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2019EUR (€) | Dec. 31, 2018USD ($) | Dec. 31, 2018EUR (€) | |
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 6,450 | $ 4,514 | $ 1,121 | ||
Make-whole payments recognized in interest expense | 1,262 | 1,289 | 1,392 | ||
Notes [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | 6,500 | 4,500 | 1,100 | ||
Make-whole payments recognized in interest expense | 96 | ||||
Notes [Member] | 2.20% notes due 2019 (2.20% 2019 Notes) [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 1,400 | ||||
Interest rate, stated percentage | 2.20% | 2.20% | |||
Notes [Member] | 5.70% notes due 2019 (5.70% 2019 Notes) [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 1,000 | ||||
Interest rate, stated percentage | 5.70% | 5.70% | |||
Notes [Member] | 2.125% euro-denominated notes due 2019 (2.125% 2019 euro Notes) [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 864 | € 675 | |||
Interest rate, stated percentage | 2.125% | 2.125% | |||
Notes [Member] | 1.90% notes due 2019 (1.90% 2019 Notes) [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 700 | ||||
Interest rate, stated percentage | 1.90% | 1.90% | |||
Notes [Member] | Floating Rate Notes Due 2019 [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 550 | ||||
Notes [Member] | 6.15% notes due 2018 (6.15% 2018 Notes) [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 500 | ||||
Interest rate, stated percentage | 6.15% | 6.15% | |||
Notes [Member] | 4.375% euro-denominated notes due 2018 (4.375% 2018 euro Notes) [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 621 | € 550 | |||
Interest rate, stated percentage | 4.375% | 4.375% | |||
Notes [Member] | 4.50% notes due 2020 (4.50% 2020 Notes) [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 300 | ||||
Interest rate, stated percentage | 4.50% | ||||
Notes [Member] | 2.125% notes due 2020 (2.125% 2020 Notes) [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 750 | ||||
Interest rate, stated percentage | 2.125% | ||||
Notes [Member] | 2.20% notes due 2020 (2.20% 2020 Notes) [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 700 | ||||
Interest rate, stated percentage | 2.20% | ||||
Notes [Member] | 3.45% notes due 2020 (3.45% 2020 Notes) [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 900 | ||||
Interest rate, stated percentage | 3.45% | ||||
Notes [Member] | 4.10% notes due 2021 (4.10% 2021 Notes) [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 1,000 | ||||
Interest rate, stated percentage | 4.10% | ||||
Notes [Member] | 1.85% notes due 2021 (1.85% 2021 Notes) [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 750 | ||||
Interest rate, stated percentage | 1.85% | ||||
Notes [Member] | 3.875% notes due 2021 (3.875% 2021 Notes) [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 1,750 | ||||
Interest rate, stated percentage | 3.875% | ||||
Notes [Member] | Floating Rate Notes Due 2020 [Member] | |||||
Debt Instrument [Line Items] | |||||
Repayments of debt | $ 300 |
Financing arrangements (Interes
Financing arrangements (Interest Rate and Cross-currency Swaps) (Details) $ in Millions | 12 Months Ended | |||||||
Dec. 31, 2020USD ($) | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | Dec. 31, 2020EUR (€) | Dec. 31, 2020CHF (SFr) | Dec. 31, 2020GBP (£) | May 31, 2020USD ($) | Feb. 29, 2020USD ($) | |
Debt Instrument [Line Items] | ||||||||
Net Cash Provided by (Used in) Operating Activities | $ 10,497 | $ 9,150 | $ 11,296 | |||||
Interest rate swap contracts [Member] | Designated as Hedging Instrument [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Notional amount | 5,900 | 9,600 | ||||||
Derivative, Notional Amount, Amount Terminated | 3,650 | |||||||
Net Cash Provided by (Used in) Operating Activities | 576 | |||||||
Interest Rate Swap, Two [Member] | Interest rate swap contracts [Member] | Designated as Hedging Instrument [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Derivative, Notional Amount, Amount Terminated | 5,200 | |||||||
Interest Rate Swap, Three [Member] | Interest rate swap contracts [Member] | Designated as Hedging Instrument [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Notional amount | $ 5,200 | |||||||
0.41% 2023 Swiss franc Bonds [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 0.41% | 0.41% | 0.41% | 0.41% | ||||
4.663% notes due 2051 (4.663% 2051 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Rate difference in an interest rate swap relationship | 1.50% | |||||||
Notes payable [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Notional amount | $ 5,900 | 9,550 | ||||||
Notes payable [Member] | 3.45% notes due 2020 (3.45% 2020 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 3.45% | 3.45% | 3.45% | 3.45% | ||||
Notional amount | $ 0 | $ 900 | ||||||
Notes payable [Member] | 3.45% notes due 2020 (3.45% 2020 Notes) [Member] | LIBOR [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Derivative, effective interest rate | 1.10% | 1.10% | 1.10% | 1.10% | 1.10% | |||
Notes payable [Member] | 4.10% notes due 2021 (4.10% 2021 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 4.10% | 4.10% | 4.10% | 4.10% | ||||
Notional amount | $ 0 | $ 1,000 | ||||||
Notes payable [Member] | 4.10% notes due 2021 (4.10% 2021 Notes) [Member] | LIBOR [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Derivative, effective interest rate | 1.70% | 1.70% | 1.70% | 1.70% | 1.70% | |||
Notes payable [Member] | 3.875% notes due 2021 (3.875% 2021 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 3.875% | 3.875% | 3.875% | 3.875% | ||||
Notional amount | $ 0 | $ 1,750 | ||||||
Notes payable [Member] | 3.875% notes due 2021 (3.875% 2021 Notes) [Member] | LIBOR [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Derivative, effective interest rate | 2.00% | 2.00% | 2.00% | 2.00% | 2.00% | |||
Notes payable [Member] | 3.625% notes due 2022 (3.625% 2022 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 3.625% | 3.625% | 3.625% | 3.625% | ||||
Notional amount | $ 750 | $ 750 | ||||||
Notes payable [Member] | 3.625% notes due 2022 (3.625% 2022 Notes) [Member] | LIBOR [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Derivative, effective interest rate | 2.70% | 1.60% | 2.70% | 2.70% | 2.70% | |||
Notes payable [Member] | 3.625% notes due 2024 (3.625% 2024 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 3.625% | 3.625% | 3.625% | 3.625% | ||||
Notional amount | $ 1,400 | $ 1,400 | ||||||
Notes payable [Member] | 3.625% notes due 2024 (3.625% 2024 Notes) [Member] | LIBOR [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Derivative, effective interest rate | 3.20% | 1.40% | 3.20% | 3.20% | 3.20% | |||
Notes payable [Member] | 3.125% notes due 2025 (3.125% 2025 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 3.125% | 3.125% | 3.125% | 3.125% | ||||
Notional amount | $ 1,000 | $ 1,000 | ||||||
Notes payable [Member] | 3.125% notes due 2025 (3.125% 2025 Notes) [Member] | LIBOR [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Derivative, effective interest rate | 1.80% | 0.90% | 1.80% | 1.80% | 1.80% | |||
Notes payable [Member] | 2.600% notes due 2026 (2.60% 2026 notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 2.60% | 2.60% | 2.60% | 2.60% | ||||
Notional amount | $ 1,250 | $ 1,250 | ||||||
Notes payable [Member] | 2.600% notes due 2026 (2.60% 2026 notes) [Member] | LIBOR [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Derivative, effective interest rate | 1.80% | 0.30% | 1.80% | 1.80% | 1.80% | |||
Notes payable [Member] | 1.25% notes due 2022 (1.25% 2022 euro Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 1.25% | 1.25% | 1.25% | 1.25% | ||||
Notes payable [Member] | 0.41% 2023 Swiss franc Bonds [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 0.41% | 0.41% | 0.41% | 0.41% | ||||
Notes payable [Member] | 2.00% 2026 euro Notes [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 2.00% | 2.00% | 2.00% | 2.00% | ||||
Notes payable [Member] | 4.663% notes due 2051 (4.663% 2051 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 4.663% | 4.663% | 4.663% | 4.663% | ||||
Notional amount | $ 1,500 | $ 1,500 | ||||||
Notes payable [Member] | 4.663% notes due 2051 (4.663% 2051 Notes) [Member] | LIBOR [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Derivative, effective interest rate | 2.60% | 0.00% | 2.60% | 2.60% | 2.60% | |||
Notes [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Face amount | $ 4,000 | $ 5,000 | ||||||
Notes [Member] | 2.20% notes due 2019 (2.20% 2019 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 2.20% | |||||||
Notes [Member] | 3.45% notes due 2020 (3.45% 2020 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 3.45% | 3.45% | 3.45% | 3.45% | ||||
Notes [Member] | 4.10% notes due 2021 (4.10% 2021 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 4.10% | 4.10% | 4.10% | 4.10% | ||||
Notes [Member] | 3.875% notes due 2021 (3.875% 2021 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 3.875% | 3.875% | 3.875% | 3.875% | ||||
Notes [Member] | 3.625% notes due 2022 (3.625% 2022 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 3.625% | 3.625% | 3.625% | 3.625% | ||||
Notes [Member] | 3.625% notes due 2024 (3.625% 2024 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 3.625% | 3.625% | 3.625% | 3.625% | ||||
Notes [Member] | 3.125% notes due 2025 (3.125% 2025 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 3.125% | 3.125% | 3.125% | 3.125% | ||||
Notes [Member] | 2.600% notes due 2026 (2.60% 2026 notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 2.60% | 2.60% | 2.60% | 2.60% | ||||
Notes [Member] | 1.25% notes due 2022 (1.25% 2022 euro Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 1.25% | 1.25% | 1.25% | 1.25% | ||||
Face amount | € | € 1,250,000,000 | |||||||
Notes [Member] | 0.41% 2023 Swiss franc Bonds [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 0.41% | 0.41% | 0.41% | 0.41% | ||||
Face amount | SFr | SFr 700,000,000 | |||||||
Notes [Member] | 2.00% 2026 euro Notes [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 2.00% | 2.00% | 2.00% | 2.00% | ||||
Face amount | € | € 750,000,000 | |||||||
Notes [Member] | 5.50% 2026 pound sterling Notes [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 5.50% | 5.50% | 5.50% | 5.50% | ||||
Face amount | £ | £ 475,000,000 | |||||||
Notes [Member] | 4.00% 2029 pound sterling Notes [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 4.00% | 4.00% | 4.00% | 4.00% | ||||
Face amount | £ | £ 700,000,000 | |||||||
Notes [Member] | 4.663% notes due 2051 (4.663% 2051 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 4.663% | 4.663% | 4.663% | 4.663% | ||||
Notes [Member] | 6.375% notes due 2037 (6.375% 2037 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 6.375% | 6.375% | 6.375% | 6.375% | ||||
Debt Conversion, Converted Instrument, Amount | $ 74 | |||||||
Notes [Member] | 2.77% notes due 2053 (2.77% 2053 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 2.77% | 2.77% | 2.77% | 2.77% | ||||
Face amount | $ 940 | |||||||
Debt exchange additional cash consideration | 85 | |||||||
Debt Instrument, Unamortized Discount | $ 264 | |||||||
Notes [Member] | 6.90% notes due 2038 (6.90% 2038 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 6.90% | 6.90% | 6.90% | 6.90% | ||||
Debt Conversion, Converted Instrument, Amount | $ 37 | |||||||
Notes [Member] | 6.40% notes due 2039 (6.40% 2039 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 6.40% | 6.40% | 6.40% | 6.40% | ||||
Debt Conversion, Converted Instrument, Amount | $ 133 | |||||||
Notes [Member] | 5.75% notes due 2040 (5.75% 2040 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 5.75% | 5.75% | 5.75% | 5.75% | ||||
Debt Conversion, Converted Instrument, Amount | $ 39 | |||||||
Notes [Member] | 5.15% notes due 2041 (5.15% 2041 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 5.15% | 5.15% | 5.15% | 5.15% | ||||
Debt Conversion, Converted Instrument, Amount | $ 245 | |||||||
Notes [Member] | 5.65% notes due 2042 (5.65% 2042 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 5.65% | 5.65% | 5.65% | 5.65% | ||||
Debt Conversion, Converted Instrument, Amount | $ 72 | |||||||
Notes [Member] | 5.375% notes due 2043 (5.375% 2043 Notes) [Member] | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate, stated percentage | 5.375% | 5.375% | 5.375% | 5.375% | ||||
Debt Conversion, Converted Instrument, Amount | $ 76 |
Financing arrangements (Shelf R
Financing arrangements (Shelf Registration Statements and Other Facilities) (Details) - Line of credit [Member] | 12 Months Ended | |
Dec. 31, 2020USD ($)renewal_option | Dec. 31, 2019USD ($) | |
Debt Instrument [Line Items] | ||
Maximum current borrowing capacity under a syndicated, unsecured, revolving credit agreement | $ 2,500,000,000 | |
Amount by which borrowing capacity under a syndicated unsecured revolving credit agreement may be increased upon our request at discretion of banks | $ 750,000,000 | |
Initial commitment term of each bank which is a party to the agreement | 5 years | |
Number of additional term extension options | renewal_option | 2 | |
Additional period for extension of commitment term | 1 year | |
Annual commitment fees for syndicated, unsecured, revolving credit agreement | 0.09% | |
Amount outstanding under syndicated, unsecured, revolving credit facility | $ 0 | $ 0 |
Fed Funds Effective Rate Overnight Index Swap Rate [Member] | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 0.50% | |
LIBOR [Member] | ||
Debt Instrument [Line Items] | ||
Basis spread on variable rate | 1.00% | |
Description of variable rate basis | one-month LIBOR |
Financing arrangements (Contrac
Financing arrangements (Contractual Maturities of Long-term Debt) (Details) $ in Millions | Dec. 31, 2020USD ($) |
Maturities of Long-term Debt [Abstract] | |
2021 | $ 0 |
2022 | 4,277 |
2023 | 1,541 |
2024 | 1,400 |
2025 | 1,500 |
Thereafter | 24,890 |
Total | $ 33,608 |
Financing arrangements (Inter_2
Financing arrangements (Interest Costs) (Details) - USD ($) $ in Billions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Debt Disclosure [Abstract] | |||
Interest paid, net of interest rate and cross currency swaps | $ 1.2 | $ 1.3 | $ 1.5 |
Stockholders' equity (Stock Rep
Stockholders' equity (Stock Repurchase Program) (Details) - USD ($) shares in Millions | 3 Months Ended | 12 Months Ended | |||||||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Equity [Abstract] | |||||||||||||||
Stock repurchases, Shares | 5.3 | 3 | 2.6 | 4.3 | 5.1 | 6.2 | 13.1 | 15.9 | 11.1 | 8.7 | 18.2 | 56.4 | 15.2 | 40.2 | 94.5 |
Stock repurchases | $ 1,221,000,000 | $ 752,000,000 | $ 591,000,000 | $ 933,000,000 | $ 1,090,000,000 | $ 1,170,000,000 | $ 2,349,000,000 | $ 3,031,000,000 | $ 2,165,000,000 | $ 1,713,000,000 | $ 3,190,000,000 | $ 10,787,000,000 | $ 3,497,000,000 | $ 7,640,000,000 | $ 17,855,000,000 |
Stock repurchase program, additional authorized amount | $ 4,000,000,000 | $ 4,000,000,000 | |||||||||||||
Amount available for stock repurchases under a board approved stock repurchase plan | $ 3,000,000,000 | $ 3,000,000,000 |
Stockholders' equity (Dividends
Stockholders' equity (Dividends) (Details) - $ / shares | Mar. 08, 2021 | Dec. 16, 2020 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2018 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 |
Class of Stock [Line Items] | |||||||||||||||||
Common stock, dividends declared per share (in usd per share) | $ 1.76 | $ 6.56 | $ 5.95 | $ 5.41 | |||||||||||||
Common stock, dividends paid per share (in usd per share) | $ 1.60 | $ 1.60 | $ 1.60 | $ 1.60 | $ 1.45 | $ 1.45 | $ 1.45 | $ 1.45 | $ 1.32 | $ 1.32 | $ 1.32 | $ 1.32 | |||||
Forecast | |||||||||||||||||
Class of Stock [Line Items] | |||||||||||||||||
Common stock, dividends paid per share (in usd per share) | $ 1.76 |
Stockholders' equity (Component
Stockholders' equity (Components of AOCI) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||
Beginning Balance | $ 9,673 | $ 12,500 | $ 25,241 |
Foreign currency translation adjustments | 9 | (48) | (141) |
Ending Balance | 9,409 | 9,673 | 12,500 |
Cumulative Effect, Period of Adoption, Adjustment [Member] | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||
Beginning Balance | (2) | 29 | |
Ending Balance | (2) | ||
Foreign currency translation [Member] | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||
Beginning Balance | (718) | (670) | (529) |
Foreign currency translation adjustments | 9 | (48) | (141) |
Income taxes | 0 | 0 | 0 |
Ending Balance | (709) | (718) | (670) |
Cash flow hedges [Member] | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||
Beginning Balance | 175 | 241 | (6) |
Unrealized (losses) gains | (61) | 127 | 61 |
Reclassification adjustments to income | 501 | 211 | 262 |
Income taxes | 124 | 18 | (76) |
Ending Balance | (263) | 175 | 241 |
Available-for-sale securities [Member] | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||
Beginning Balance | 22 | (338) | (144) |
Unrealized (losses) gains | 6 | 424 | (556) |
Reclassification adjustments to income | 33 | 56 | 365 |
Income taxes | 6 | (8) | 6 |
Ending Balance | 1 | 22 | (338) |
Available-for-sale securities [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||
Beginning Balance | (9) | ||
Other [Member] | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||
Beginning Balance | (7) | (2) | 0 |
Other losses | (7) | (5) | (2) |
Ending Balance | (14) | (7) | (2) |
AOCI [Member] | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||
Beginning Balance | (528) | (769) | (679) |
Foreign currency translation adjustments | 9 | (48) | (141) |
Unrealized (losses) gains | (55) | 551 | (495) |
Reclassification adjustments to income | (534) | (267) | 627 |
Other losses | (7) | (5) | (2) |
Income taxes | 130 | 10 | (70) |
Ending Balance | $ (985) | $ (528) | (769) |
AOCI [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||
Beginning Balance | $ (9) |
Stockholders' equity (Accumulat
Stockholders' equity (Accumulated Other Comprehensive Income (Loss), Textual) (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Equity [Abstract] | |||
Income tax expense or (benefit) for reclassification adjustments to income for available-for-sale securities | $ 7 | $ 14 | $ (3) |
Income taxes expense or (benefit) for unrealized gains and losses for available-for-sale securities | (1) | (22) | 9 |
Income taxes expense or (benefit) for unrealized gains and losses for cash flow hedges | 14 | (28) | (21) |
Income tax expense or (benefit) reclassification adjustments to income for cash flow hedges | $ 110 | $ 46 | $ (55) |
Stockholders' equity (Reclassif
Stockholders' equity (Reclassifications out of AOCI) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||||||||
Revenues | $ 25,424 | $ 23,362 | $ 23,747 | ||||||||
Interest and other income, net | 256 | 753 | 674 | ||||||||
Interest expense, net | (1,262) | (1,289) | (1,392) | ||||||||
Income before income taxes | 8,133 | 9,138 | 9,545 | ||||||||
Provision for income taxes | (869) | (1,296) | (1,151) | ||||||||
Net income | $ 1,615 | $ 2,021 | $ 1,803 | $ 1,825 | $ 1,703 | $ 1,968 | $ 2,179 | $ 1,992 | 7,264 | 7,842 | 8,394 |
Product sales [Member] | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||||||||
Revenues | $ 6,334 | $ 6,104 | $ 5,908 | $ 5,894 | $ 5,881 | $ 5,463 | $ 5,574 | $ 5,286 | 24,240 | 22,204 | 22,533 |
Reclassification out of AOCI [Member] | Cash flow hedges [Member] | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||||||||
Income before income taxes | 501 | 211 | (262) | ||||||||
Provision for income taxes | (110) | (46) | 55 | ||||||||
Net income | 391 | 165 | (207) | ||||||||
Reclassification out of AOCI [Member] | Available-for-sale securities [Member] | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||||||||
Interest and other income, net | 33 | 56 | (365) | ||||||||
Provision for income taxes | (7) | (14) | 3 | ||||||||
Net income | 26 | 42 | (362) | ||||||||
Reclassification out of AOCI [Member] | Foreign currency contract [Member] | Product sales [Member] | Cash flow hedges [Member] | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||||||||
Revenues | 178 | 101 | (21) | ||||||||
Reclassification out of AOCI [Member] | Foreign currency contract [Member] | Cash flow hedge [Member] | Product sales [Member] | Cash flow hedges [Member] | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||||||||
Revenues | 178 | 101 | (21) | ||||||||
Reclassification out of AOCI [Member] | Cross-currency swap contract [Member] | Cash flow hedges [Member] | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||||||||
Interest and other income, net | 323 | 110 | (241) | ||||||||
Reclassification out of AOCI [Member] | Cross-currency swap contract [Member] | Cash flow hedge [Member] | Cash flow hedges [Member] | |||||||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||||||||||
Interest and other income, net | $ 323 | $ 110 | $ (241) |
Stockholders' equity (Other) (D
Stockholders' equity (Other) (Details) - $ / shares | Dec. 31, 2020 | Dec. 31, 2019 |
Equity [Abstract] | ||
Preferred stock shares authorized (in shares) | 5,000,000 | |
Preferred stock, par value (in usd per share) | $ 0.0001 | |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Fair value measurement - (Fair
Fair value measurement - (Fair Value of Financial Assets and Liabilities on Recurring Basis) (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Assets: | ||
Interest-bearing securities | $ 9,845 | $ 8,234 |
Equity securities | 477 | 303 |
Derivatives: | ||
Total assets | 10,671 | 9,086 |
Derivatives: | ||
Contingent consideration obligations | 33 | 61 |
Total liabilities | 603 | 407 |
Foreign currency contracts [Member] | ||
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 28 | 224 |
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 237 | 31 |
Cross-currency swap contracts [Member] | ||
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 255 | 66 |
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 318 | 315 |
Interest rate swap contracts [Member] | ||
Derivatives: | ||
Interest rate swap contracts | 66 | 259 |
Derivatives: | ||
Interest rate swap contracts | 15 | 0 |
U.S. Treasury notes [Member] | ||
Assets: | ||
Interest-bearing securities | 130 | 360 |
U.S. Treasury bills [Member] | ||
Assets: | ||
Interest-bearing securities | 4,948 | 0 |
Corporate debt securities - Financial [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 1,121 |
Corporate debt securities - Industrial [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 834 |
Corporate debt securities - Other [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 198 |
Residential mortgage-backed securities [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 182 |
Money market mutual funds [Member] | ||
Assets: | ||
Interest-bearing securities | 4,765 | 5,250 |
Other short-term interest-bearing securities [Member] | ||
Assets: | ||
Interest-bearing securities | 2 | 289 |
Quoted prices in active markets for identical assets (Level 1) [Member] | ||
Assets: | ||
Equity securities | 477 | 303 |
Derivatives: | ||
Total assets | 10,320 | 5,913 |
Derivatives: | ||
Contingent consideration obligations | 0 | 0 |
Total liabilities | 0 | 0 |
Quoted prices in active markets for identical assets (Level 1) [Member] | Foreign currency contracts [Member] | ||
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 0 | 0 |
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 0 | 0 |
Quoted prices in active markets for identical assets (Level 1) [Member] | Cross-currency swap contracts [Member] | ||
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 0 | 0 |
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 0 | 0 |
Quoted prices in active markets for identical assets (Level 1) [Member] | Interest rate swap contracts [Member] | ||
Derivatives: | ||
Interest rate swap contracts | 0 | 0 |
Derivatives: | ||
Interest rate swap contracts | 0 | 0 |
Quoted prices in active markets for identical assets (Level 1) [Member] | U.S. Treasury notes [Member] | ||
Assets: | ||
Interest-bearing securities | 130 | 360 |
Quoted prices in active markets for identical assets (Level 1) [Member] | U.S. Treasury bills [Member] | ||
Assets: | ||
Interest-bearing securities | 4,948 | 0 |
Quoted prices in active markets for identical assets (Level 1) [Member] | Corporate debt securities - Financial [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 0 |
Quoted prices in active markets for identical assets (Level 1) [Member] | Corporate debt securities - Industrial [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 0 |
Quoted prices in active markets for identical assets (Level 1) [Member] | Corporate debt securities - Other [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 0 |
Quoted prices in active markets for identical assets (Level 1) [Member] | Residential mortgage-backed securities [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 0 |
Quoted prices in active markets for identical assets (Level 1) [Member] | Money market mutual funds [Member] | ||
Assets: | ||
Interest-bearing securities | 4,765 | 5,250 |
Quoted prices in active markets for identical assets (Level 1) [Member] | Other short-term interest-bearing securities [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 0 |
Significant other observable inputs (Level 2) [Member] | ||
Assets: | ||
Equity securities | 0 | 0 |
Derivatives: | ||
Total assets | 351 | 3,173 |
Derivatives: | ||
Contingent consideration obligations | 0 | 0 |
Total liabilities | 570 | 346 |
Significant other observable inputs (Level 2) [Member] | Foreign currency contracts [Member] | ||
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 28 | 224 |
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 237 | 31 |
Significant other observable inputs (Level 2) [Member] | Cross-currency swap contracts [Member] | ||
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 255 | 66 |
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 318 | 315 |
Significant other observable inputs (Level 2) [Member] | Interest rate swap contracts [Member] | ||
Derivatives: | ||
Interest rate swap contracts | 66 | 259 |
Derivatives: | ||
Interest rate swap contracts | 15 | 0 |
Significant other observable inputs (Level 2) [Member] | U.S. Treasury notes [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 0 |
Significant other observable inputs (Level 2) [Member] | U.S. Treasury bills [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 0 |
Significant other observable inputs (Level 2) [Member] | Corporate debt securities - Financial [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 1,121 |
Significant other observable inputs (Level 2) [Member] | Corporate debt securities - Industrial [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 834 |
Significant other observable inputs (Level 2) [Member] | Corporate debt securities - Other [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 198 |
Significant other observable inputs (Level 2) [Member] | Residential mortgage-backed securities [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 182 |
Significant other observable inputs (Level 2) [Member] | Money market mutual funds [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 0 |
Significant other observable inputs (Level 2) [Member] | Other short-term interest-bearing securities [Member] | ||
Assets: | ||
Interest-bearing securities | 2 | 289 |
Significant unobservable inputs (Level 3) [Member] | ||
Assets: | ||
Equity securities | 0 | 0 |
Derivatives: | ||
Total assets | 0 | |
Derivatives: | ||
Contingent consideration obligations | 33 | 61 |
Total liabilities | 33 | 61 |
Significant unobservable inputs (Level 3) [Member] | Foreign currency contracts [Member] | ||
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 0 | 0 |
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 0 | 0 |
Significant unobservable inputs (Level 3) [Member] | Cross-currency swap contracts [Member] | ||
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 0 | 0 |
Derivatives: | ||
Foreign currency and cross-currency swap contracts | 0 | 0 |
Significant unobservable inputs (Level 3) [Member] | Interest rate swap contracts [Member] | ||
Derivatives: | ||
Interest rate swap contracts | 0 | 0 |
Derivatives: | ||
Interest rate swap contracts | 0 | 0 |
Significant unobservable inputs (Level 3) [Member] | U.S. Treasury notes [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 0 |
Significant unobservable inputs (Level 3) [Member] | U.S. Treasury bills [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 0 |
Significant unobservable inputs (Level 3) [Member] | Corporate debt securities - Financial [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 0 |
Significant unobservable inputs (Level 3) [Member] | Corporate debt securities - Industrial [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 0 |
Significant unobservable inputs (Level 3) [Member] | Corporate debt securities - Other [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 0 |
Significant unobservable inputs (Level 3) [Member] | Residential mortgage-backed securities [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 0 |
Significant unobservable inputs (Level 3) [Member] | Money market mutual funds [Member] | ||
Assets: | ||
Interest-bearing securities | 0 | 0 |
Significant unobservable inputs (Level 3) [Member] | Other short-term interest-bearing securities [Member] | ||
Assets: | ||
Interest-bearing securities | $ 0 | $ 0 |
Fair value measurement - Narrat
Fair value measurement - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | |||
Dec. 31, 2020 | Dec. 31, 2018 | Jan. 02, 2020 | Dec. 31, 2019 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Length of time hedged in foreign currency contracts | 3 years | |||
Aggregate fair value of long-term debt, including current portion | $ 39,400 | $ 33,700 | ||
Carrying value of long-term debt, including current portion | 32,986 | $ 29,903 | ||
Other operating income (expense) [Member] | IPR&D [Member] | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
IPR&D impairment charge | $ 330 | |||
BeiGene | ||||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||||
Equity Method Investment, Quoted Market Value | 4,900 | $ 2,600 | ||
Approximate carrying value of the company's equity method investment | $ 2,900 |
Derivative instruments - Narrat
Derivative instruments - Narrative (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Derivative Instruments Gain Loss [Line Items] | |||
Net Cash Provided by (Used in) Operating Activities | $ 10,497 | $ 9,150 | $ 11,296 |
Long-term debt | |||
Derivative Instruments Gain Loss [Line Items] | |||
Carrying amounts of hedged liabilities | 6,258 | 8,814 | |
Foreign currency and cross currency swap contracts [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Amounts expected to be reclassified from AOCI into earnings over the next 12 months, foreign currency and cross-currency swaps | (136) | ||
Interest rate swap [Member] | Interest Expense [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Derivative, Gain on Derivative | 40 | ||
Interest Rate Swap, At-Then Current Interest Rates [Member] | Long-term debt | |||
Derivative Instruments Gain Loss [Line Items] | |||
Carrying amounts of hedged liabilities | 5,200 | ||
Derivatives designated as hedging instruments [Member] | Foreign currency forward contracts [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Notional amount | 5,100 | 5,000 | 4,500 |
Derivatives designated as hedging instruments [Member] | Foreign currency option contracts [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Notional amount | 21 | ||
Derivatives designated as hedging instruments [Member] | Interest rate swap [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Notional amount | 5,900 | 9,600 | |
Derivative, Notional Amount, Amount Terminated | 3,650 | ||
Net Cash Provided by (Used in) Operating Activities | 576 | ||
Derivative, Notional Amount, Amount Terminated Resulting In Net Cash Provided By Operating Activities | 5,200 | ||
Derivatives designated as hedging instruments [Member] | Interest rate swap [Member] | Interest Rate Swap, Two [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Derivative, Notional Amount, Amount Terminated | 5,200 | ||
Derivatives not designated as hedging instruments [Member] | Foreign currency forward contracts [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Notional amount | $ 1,000 | $ 1,200 | $ 737 |
Notes [Member] | Two Point One Two Five Percent Euro Notes Due 2019 [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Interest rate, stated percentage | 2.125% |
Derivative instruments - (Cross
Derivative instruments - (Cross-currency Swaps) (Details) - Cash flow hedge [Member] - Cross-currency swap contracts [Member] € in Millions, £ in Millions, SFr in Millions, $ in Millions | Dec. 31, 2020USD ($) | Dec. 31, 2020EUR (€) | Dec. 31, 2020CHF (SFr) | Dec. 31, 2020GBP (£) |
1.25% 2022 euro Notes [Member] | ||||
Derivative [Line Items] | ||||
Notional amount | $ 1,388 | € 1,250 | ||
0.41% 2023 Swiss franc Bonds [Member] | ||||
Derivative [Line Items] | ||||
Notional amount | 704 | SFr 700 | ||
2.00% 2026 euro Notes [Member] | ||||
Derivative [Line Items] | ||||
Notional amount | 833 | € 750 | ||
5.50% 2026 pound sterling Notes [Member] | ||||
Derivative [Line Items] | ||||
Notional amount | 747 | £ 475 | ||
4.00% 2029 pound sterling Notes [Member] | ||||
Derivative [Line Items] | ||||
Notional amount | $ 1,111 | £ 700 | ||
Euro Member Countries, Euro [Member] | 1.25% 2022 euro Notes [Member] | ||||
Derivative [Line Items] | ||||
Interest rates | 1.30% | 1.30% | 1.30% | 1.30% |
Euro Member Countries, Euro [Member] | 2.00% 2026 euro Notes [Member] | ||||
Derivative [Line Items] | ||||
Interest rates | 2.00% | 2.00% | 2.00% | 2.00% |
Switzerland, Francs [Member] | 0.41% 2023 Swiss franc Bonds [Member] | ||||
Derivative [Line Items] | ||||
Interest rates | 0.40% | 0.40% | 0.40% | 0.40% |
United Kingdom, Pounds [Member] | 5.50% 2026 pound sterling Notes [Member] | ||||
Derivative [Line Items] | ||||
Interest rates | 5.50% | 5.50% | 5.50% | 5.50% |
United Kingdom, Pounds [Member] | 4.00% 2029 pound sterling Notes [Member] | ||||
Derivative [Line Items] | ||||
Interest rates | 4.00% | 4.00% | 4.00% | 4.00% |
United States of America, Dollars [Member] | 1.25% 2022 euro Notes [Member] | ||||
Derivative [Line Items] | ||||
Interest rates | 3.20% | 3.20% | 3.20% | 3.20% |
United States of America, Dollars [Member] | 0.41% 2023 Swiss franc Bonds [Member] | ||||
Derivative [Line Items] | ||||
Interest rates | 3.40% | 3.40% | 3.40% | 3.40% |
United States of America, Dollars [Member] | 2.00% 2026 euro Notes [Member] | ||||
Derivative [Line Items] | ||||
Interest rates | 3.90% | 3.90% | 3.90% | 3.90% |
United States of America, Dollars [Member] | 5.50% 2026 pound sterling Notes [Member] | ||||
Derivative [Line Items] | ||||
Interest rates | 6.00% | 6.00% | 6.00% | 6.00% |
United States of America, Dollars [Member] | 4.00% 2029 pound sterling Notes [Member] | ||||
Derivative [Line Items] | ||||
Interest rates | 4.50% | 4.50% | 4.50% | 4.50% |
Derivative instruments - (Effec
Derivative instruments - (Effective Portion of Unrealized Gain (Loss)) (Details) - Cash flow hedge [Member] - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Derivative Instruments Gain Loss [Line Items] | |||
Total unrealized (losses) gains | $ (61) | $ 127 | $ 61 |
Foreign currency contracts [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Total unrealized (losses) gains | (251) | 148 | 348 |
Cross-currency swap contracts [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Total unrealized (losses) gains | 190 | (21) | (287) |
Forward interest rate contracts [Member] | |||
Derivative Instruments Gain Loss [Line Items] | |||
Total unrealized (losses) gains | $ 0 | $ 0 | $ 0 |
Derivative instruments - (Hedge
Derivative instruments - (Hedged Liabilities and Cumulative Amount) (Details) (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Derivative [Line Items] | ||
Cumulative amounts of fair value hedging adjustments related to the carrying amounts of the hedged liabilities | $ 566 | $ 296 |
Current portion of long-term debt | ||
Derivative [Line Items] | ||
Carrying amounts of hedged liabilities | 89 | 903 |
Cumulative amounts of fair value hedging adjustments related to the carrying amounts of the hedged liabilities | 89 | 4 |
Carrying value with discontinued hedging relationships | 89 | |
Hedging adjustments on discontinued hedging relationships | 89 | |
Long-term debt | ||
Derivative [Line Items] | ||
Carrying amounts of hedged liabilities | 6,258 | 8,814 |
Cumulative amounts of fair value hedging adjustments related to the carrying amounts of the hedged liabilities | 477 | 292 |
Carrying value with discontinued hedging relationships | 525 | 136 |
Hedging adjustments on discontinued hedging relationships | $ 425 | $ 36 |
Derivative instruments - (Summa
Derivative instruments - (Summary of Income and Expense Line Items) (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Derivative [Line Items] | |||||||||||
Product sales | $ 25,424 | $ 23,362 | $ 23,747 | ||||||||
Interest and other income, net | 256 | 753 | 674 | ||||||||
Interest expense, net | (1,262) | (1,289) | (1,392) | ||||||||
Interest rate swap agreements [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Gains (losses) on fair value hedging relationships, Hedged Items | 315 | (349) | 65 | ||||||||
Gains (losses) on fair value hedging relationships, Derivatives designated as hedging instruments | (204) | 352 | (42) | ||||||||
Reclassification out of Accumulated Other Comprehensive Income [Member] | Cash flow hedges [Member] | Cross-currency swap contracts [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Interest and other income, net | 323 | 110 | (241) | ||||||||
Product sales [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Product sales | $ 6,334 | $ 6,104 | $ 5,908 | $ 5,894 | $ 5,881 | $ 5,463 | $ 5,574 | $ 5,286 | 24,240 | 22,204 | 22,533 |
Product sales [Member] | Reclassification out of Accumulated Other Comprehensive Income [Member] | Cash flow hedges [Member] | Foreign currency contracts [Member] | |||||||||||
Derivative [Line Items] | |||||||||||
Product sales | $ 178 | $ 101 | $ (21) |
Derivative instruments - (Fair
Derivative instruments - (Fair Value of Derivatives) (Details) - USD ($) $ in Millions | Dec. 31, 2020 | Dec. 31, 2019 |
Assets | ||
Total derivative assets, fair value | $ 349 | $ 549 |
Liabilities | ||
Total derivative liabilities, fair value | 570 | 346 |
Derivatives designated as hedging instruments [Member] | ||
Assets | ||
Total derivative assets, fair value | 349 | 548 |
Liabilities | ||
Total derivative liabilities, fair value | 570 | 346 |
Derivatives designated as hedging instruments [Member] | Foreign currency contracts [Member] | Other current assets/Other assets [Member] | ||
Assets | ||
Total derivative assets, fair value | 28 | 223 |
Derivatives designated as hedging instruments [Member] | Foreign currency contracts [Member] | Accrued liabilities/Other noncurrent liabilities [Member] | ||
Liabilities | ||
Total derivative liabilities, fair value | 237 | 31 |
Derivatives designated as hedging instruments [Member] | Cross-currency swap contracts [Member] | Other current assets/Other assets [Member] | ||
Assets | ||
Total derivative assets, fair value | 255 | 66 |
Derivatives designated as hedging instruments [Member] | Cross-currency swap contracts [Member] | Accrued liabilities/Other noncurrent liabilities [Member] | ||
Liabilities | ||
Total derivative liabilities, fair value | 318 | 315 |
Derivatives designated as hedging instruments [Member] | Interest rate swap contracts [Member] | Other current assets/Other assets [Member] | ||
Assets | ||
Total derivative assets, fair value | 66 | 259 |
Derivatives designated as hedging instruments [Member] | Interest rate swap contracts [Member] | Accrued liabilities/Other noncurrent liabilities [Member] | ||
Liabilities | ||
Total derivative liabilities, fair value | 15 | 0 |
Derivatives not designated as hedging instruments [Member] | ||
Assets | ||
Total derivative assets, fair value | 0 | 1 |
Liabilities | ||
Total derivative liabilities, fair value | 0 | 0 |
Derivatives not designated as hedging instruments [Member] | Foreign currency contracts [Member] | Other current assets [Member] | ||
Assets | ||
Total derivative assets, fair value | 0 | 1 |
Derivatives not designated as hedging instruments [Member] | Foreign currency contracts [Member] | Accrued liabilities [Member] | ||
Liabilities | ||
Total derivative liabilities, fair value | $ 0 | $ 0 |
Contingencies and commitments (
Contingencies and commitments (KYPROLIS ANDA Patent Litigation) (Details) - patent | May 08, 2020 | Apr. 30, 2018 |
Gain Contingencies [Line Items] | ||
Number of asserted patents | 3 | |
Onyx Therapeutics, Inc [Member] | KYPROLIS (carfilzomib) Patent Litigation [Member] | ||
Gain Contingencies [Line Items] | ||
Number of patents allegedly infringed | 1 |
Contingencies and commitments_2
Contingencies and commitments (Sandoz Patent Litigation) (Details) | 1 Months Ended |
Jun. 30, 2018lawsuit | |
Sandoz Inc. | |
Gain Contingencies [Line Items] | |
Number of lawsuits filed | 19 |
Contingencies and commitments_3
Contingencies and commitments (Amneal Pharmaceuticals LLC Litigation) (Details) - Amneal Pharmaceuticals LLC | 1 Months Ended |
Sep. 30, 2016lawsuit | |
Gain Contingencies [Line Items] | |
Number of lawsuits filed | 14 |
Number of lawsuits consolidated | 14 |
Contingencies and commitments_4
Contingencies and commitments (Immunex and Sandoz Litigation) (Details) | 1 Months Ended | |
Apr. 30, 2019affiliate | Feb. 28, 2016patentaffiliate | |
Immunex/Sandoz | ||
Other Commitments [Line Items] | ||
Gain contingency, number of affiliates | 2 | |
Number of patents allegedly infringed | patent | 5 | |
Immunex/Samsung Bioepis Co. | ||
Other Commitments [Line Items] | ||
Gain contingency, number of affiliates | 2 |
Contingencies and commitments_5
Contingencies and commitments (Repatha Patent Litigation) (Details) - Sanofi/Regeneron Patent Litigation - patent | 1 Months Ended | ||
Mar. 31, 2018 | Feb. 28, 2016 | Oct. 31, 2014 | |
Other Commitments [Line Items] | |||
Number of patents allegedly infringed | 7 | ||
Length of trial | 5 days | ||
Number of challenges | 2 |
Contingencies and commitments_6
Contingencies and commitments (Additional Information) (Details) | 1 Months Ended | 3 Months Ended | ||||
Apr. 30, 2019agreement | May 31, 2019complaints | Apr. 30, 2019claimlawsuitplaintiffs | May 31, 2020claim | Jun. 04, 2019claim | May 20, 2019claim | |
Loss Contingencies [Line Items] | ||||||
Number of claims | 1 | |||||
Novartis Breach Of Contract Action | ||||||
Loss Contingencies [Line Items] | ||||||
Agreements breached | agreement | 2 | |||||
Sensipar Antitrust Class Actions | ||||||
Loss Contingencies [Line Items] | ||||||
Loss contingency, number of plaintiffs | plaintiffs | 4 | |||||
Loss contingency, number of lawsuits | 2 | |||||
Loss contingency, number of lawsuits filed | lawsuit | 4 | |||||
Humira Biosimilar Antitrust Class Actions | ||||||
Loss Contingencies [Line Items] | ||||||
Number of claims | 12 | 12 | ||||
Number of complaints stayed | complaints | 6 |
Contingencies and commitments_7
Contingencies and commitments (U.S. Repatriation Tax Commitments) (Details) $ in Millions | Dec. 31, 2020USD ($)installment |
Commitments and Contingencies Disclosure [Abstract] | |
U.S. repatriation tax commitments, number of annual installments | installment | 8 |
U.S. repatriation tax commitments, 2021 | $ 587 |
U.S. repatriation tax commitments, 2022 | 587 |
U.S. repatriation tax commitments, 2023 | 1,100 |
U.S. repatriation tax commitments, 2024 | 1,467 |
U.S. repatriation tax commitments, 2025 | 1,834 |
Total remaining U.S. repatriation tax commitments | $ 5,575 |
Quarterly financial data (una_3
Quarterly financial data (unaudited) (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Effect of Fourth Quarter Events [Line Items] | |||||||||||
Product sales | $ 25,424 | $ 23,362 | $ 23,747 | ||||||||
Gross profit from product sales | $ 4,737 | $ 4,543 | $ 4,420 | $ 4,381 | $ 4,628 | $ 4,427 | $ 4,562 | $ 4,231 | |||
Net income | $ 1,615 | $ 2,021 | $ 1,803 | $ 1,825 | $ 1,703 | $ 1,968 | $ 2,179 | $ 1,992 | $ 7,264 | $ 7,842 | $ 8,394 |
Earnings per share: | |||||||||||
Basic (in usd per share) | $ 2.78 | $ 3.45 | $ 3.07 | $ 3.09 | $ 2.87 | $ 3.29 | $ 3.59 | $ 3.20 | $ 12.40 | $ 12.96 | $ 12.70 |
Diluted (in usd per share) | $ 2.76 | $ 3.43 | $ 3.05 | $ 3.07 | $ 2.85 | $ 3.27 | $ 3.57 | $ 3.18 | $ 12.31 | $ 12.88 | $ 12.62 |
Product [Member] | |||||||||||
Effect of Fourth Quarter Events [Line Items] | |||||||||||
Product sales | $ 6,334 | $ 6,104 | $ 5,908 | $ 5,894 | $ 5,881 | $ 5,463 | $ 5,574 | $ 5,286 | $ 24,240 | $ 22,204 | $ 22,533 |
SCHEDULE II - VALUATION AND Q_2
SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | |
Allowance for doubtful accounts [Roll Forward] | |||
Balance at beginning of period | $ 26 | $ 48 | $ 51 |
Additions charged to costs and expenses | 8 | 0 | 1 |
Other additions | 0 | 0 | 0 |
Deductions | 2 | 22 | 4 |
Balance at end of period | $ 32 | $ 26 | $ 48 |